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T5 Oil & Gas

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SENEGALLOUGA BLOCK

Opportunity To Explore A High Potential Palaeozoic Play

Guinea

The Gambia

Guinea-Bissau

Mali

Mauritania

SenegalDakar

0 300150 Kilometers

0 200100 Miles

Senegal: Oil and Gas Exploration Blocks

LOUGAEPSA

RatifiedJuly2013

St-LOUISDEEP

SANGOMARDEEP SANGOMAR

St-LOUIS

CAYAR

THIES

MBOURDIOURBEL

SALOUMRUFISQUE

RUFISQUEDEEP

CAYARDEEP

SENEGAL EAST

SENEGAL SUDONSHORE

SENEGAL SUDOFFSHORESHALLOW

SENEGAL SUDOFFSHORE

DEEP

AGC AreaDomeFlore

A rare opportunity to participate in a high potential Palaeozoic play which is highly prolific in analogous Saharan basins. The licence is held under attractive contract terms in an accessible, onshore, energy-hungry setting in Senegal - a stable rapidly developing Africa country.

Executive summaryT5 oil & gas hold a 90% working interest with Petrosen in the onshore Louga Block, northern Senegal. The blocks extends to almost 27,000 sq. km. and is virtually unexplored. An analysis of existing technical data -several key wells and regional geophysical data (2D seismic and gravity and magnetics) has identified a high reward potential Palaeozoic play. Most importantly, the play is developed at accessible drilling depths in a logistically benign, unpopulated area with ready access to infrastructure and energy markets in Dakar, as well as the hinterland. A significant but low cost work programme comprising 2D seismic (1100 km) and a well to test the Palaeozoic is defined in the PSA. Although the area lacks a comprehensive well or seismic database, there is sufficient data to establish the presence of the classic elements of a Palaeozoic play. In addition, the proven Cenozoic-Mesozoic play is viable and offers a second important objective in Louga. More recently the non-conventional resource potential of Palaeozoic shale has attracted considerable industry attention, with proof of concept underway in North Africa. Given the dire energy shortages prevailing in west sub-Saharan Africa, an assessment of the non-conventional potential is an important fact in the overall exploration programme.

The Louga block is governed by a well-defined Production Sharing Agreement. The contract has attractive commercial and work obligation terms.

Geological and geophysical work is now underway in order to better define the form of the Palaeozoic basin in northern Senegal. This will include a block specific study using gravity, magnetic and remote sensed data (by Getech) and a reprocessing of up to 850 km of 1970’s regional seismic data acquired by Shell. Preliminary analysis has indicated two immediate zones of interest for a new seismic programme – one on the north-west of Louga where both Mesozoic and Palaeozoic structural leads are identified and in southern Louga where very large scale fold and thrust anticlines are developed. These will be high priority areas for the new seismic programme.

senegal Geopolitical aspectsThe country with a population of c.12 million people is situated in western sub-Saharan Africa. The country secured its independence from France in 1960 and has a strong democratic tradition. This has led to an enduring social and political stability and the maintenance of strong ties with Europe. The country is ideally placed as the most important access point to a hinterland comprising Mauritania, Mali, Gambia, Guinea Bissau and Republic of Guinea. Recent initiatives by the country’s executive has encouraged interest in the oil and gas sector. Although Senegal is experiencing solid economic growth (c.4% pa) this is constrained by the lack of reasonably priced energy feedstock. There is therefore a ready market for both oil and gas resources and a key aspect of government policy is to improve the country energy situation.

Commercialisation of Gas Resources in senegalThere is a preponderance of gas over oil resource discoveries in Palaeozoic plays. Whereas this often presents a commercial challenge in Africa, this is not the case in Senegal. The Senegalese economy is suffering from an ongoing, severe energy shortage. More than 85 % of current electricity generation is from expensive imported Heavy Fuel Oil (HFO) and diesel - an unsustainable drain on the country’s limited financial resources. The search for and exploitation of indigenous hydrocarbons is a key policy objective of the Government. Furthermore, government is committed to an expansion of the generating base available for industrial development and for a comprehensive rural electrification scheme. Installed Capacity in 2012 was only 605MW: in order to underpin economic development the Ministry of Energy cites a need for 1490MW by 2016 - a 250 % increase. A gas resource feedstock would therefore find an immediate central role and provide a long term stable solution the country’s energy needs. Historically there have been highly successful small scale Gas to Power projects undertaken by Tullow Oil in the period 1987-2000 and more recently by Fortesa. State electricity utility Senelec has existing dual fuel capacity and is capable of conversion as more substantial, dependable gas feedstock becomes available. Senelec receives ongoing support and oversight from the World Bank. Independent Power Projects are also encouraged by government. T5 is engaged on an ongoing basis with the Ministry, Senelec and private generators on the various avenues available to ensure early gas resource commercial use. Gas resources may be developed incrementally via schemes such as deployed in Benin by CAI where 80MW was commissioned in record time. Should a major new gas resource be defined, a large scale gas burning power station is the obvious route. Given Senegal’s location as the access point to a huge, energy-hungry hinterland, there is also scope for export of surplus electricity.

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Regional settingThe Senegal basin is part of the North -west African Coastal Basin- a typical passive margin basin opening west to the Atlantic. The eastern limit is the Mauritanides chain. The complexities of the rift tectonics of the Atlantic opening gave rise to a series of sub-basins aligned north-south.

The pre-rift (Upper Proterozoic to Palaeozoic), syn-rift (Permian to Lower Jurassic) and post-Rift are divided into a number of sub-basins, controlled by east west transform related lineaments.

Geological and geophysical work is now underway in order to better define the form of the Palaeozoic basin in northern Senegal. This will include a block specific study using gravity, magnetic and remote sensed data (by Getech) and a reprocessing of up to 850 km of 1970’s regional seismic data acquired by Shell. Preliminary analysis has indicated two immediate zones of interest for a new seismic programme – one on the north-west of Louga where both Mesozoic and Palaeozoic structural leads are identified and in southern Louga where very large scale fold and thrust anticlines are developed. These will be high priority areas for the new seismic programme.

The pre-rift is known from outcrop in the Bove Basin in Guinea Bissau / Guinea. Two key wells Diana-Malari-1 and Kolda -1 encountered Ordovician, Silurian and Devonian sediments. The Syn-rift was not drilled in Senegal but regional seismic evidence, and by comparison with analogue basins, suggest it may be developed in the deeper central parts of the basin. The post Rift in Senegal comprises a Jurassic to Lower Cretaceous carbonate platform, overlain by a Cretaceous clastic wedge and topped by Tertiary carbonates and shale.

The senegal Mesozoic – Palaeozoic Basin

The senegal Basin Framework

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The Palaeozoic sectionThe Palaeozoic section is exposed in the Bove Basin of Guinea Bissau and Guinea.

Over 3500 m of section is present with extensive shale sequences in the Devonian, Silurian and Cambrian.

High TOC values of up to 5.5 % are noted in samples.

Oil and gas seeps are reported from boreholes in Republic of Guinea

Two major tectonic styles are recognised in the Palaeozoic: in southern Senegal (Casamance) an extensional system of horst and grabens, tilted fault blocks interpreted to be a pre-Hercynian structural regime. Central and northern Senegal exhibit a compressional regime – the combined effect of Caledonian and Hercnyian orogenies.

The overall form of the Palaeozoic Basin is reasonably well defined from gravity and magnetic data, regional 2D seismic and a small number of well penetrations.

A prospective fairway runs north south through the Louga Block at which the potential reservoir section is in the range 1200m to 4500m.

The structural form of the basin will be further defined by reprocessing of gravity & magnetic data and a reprocessing of the available regional 2D seismic.

DEPTH TO TOP PALAEOZOIC (from gravity, magnetic, seismic and well data)

Petroleum GeologyThe key components of a viable Palaeozoic hydrocarbon system are interpreted to be in place.

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Reservoirs in the PalaeozoicDevonian: Southern Senegal well DM-1 drilled 47 m of Devonian; it comprised fine to medium grained quartz rich sandstones, shales and limey shale. Porosities ranged from 10-20% and they are of a shallow marine environment. This well may have been close to the depositional edge of the sequence. In the Bove Basin over 450 m of Devonian section are exposed of which some 300m are represented as the Bafata shales.

Ordovician: Well DM-1 drilled 581m of Ordovician sediments. This thick sequence to t.d. of the well comprised quartz-rich sandstones described as having no primary porosity or permeability; however, they are highly fractured and therefore have good reservoir quality secondary porosity characteristics. These sandstones are in a continental to epi-continental palaeogeographic setting.

Carbonferous: The southern, depositional edge, wells DM-1 and KO-1 did not encounter Carboniferous. However in well Diourbel -1 in central Senegal, which represents the deepest Palaeozoic penetration, detrital argillaceous sandstones with Lower Carboniferous fauna / plant fragments were described. The Carboniferous is present in the Taoudeni Basin to the east in Mauritania and Mali. It may be developed in the deeper central part of the Palaeozoic basin. In North Africa Saharan basins the Carboniferous constitutes a good quality reservoir.

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Reservoir- source Rock Combinations (Well Dm-1)source Rocks and Maturation

The Silurian shale is recognised as the main regional Palaeozoic source rock. In southern Senegal (Casamance) the Silurian was encountered in wells DM-1 and KO-1, and at outcrop in the Bove Basin (up to 400 m thick). The section of marine shales are described as graptolitic, with black amorphous organic matter with Total Organic Content in the range 1% -3% from DM-1 and KO-1, and even higher values from outcrop samples in Bove Basin. Organic matter is primarily Type II.

Palaeogeographic reconstructions indicate that the Senegal Basin is at the southern extremity of an areally extensive Silurian depositional environment, extending through North Africa and eastwards to the Gulf region. Petrosen has published various geochemical studies undertaken with Beicip and Petrocanada on the key DM-1 and KO-1 wells. The tables below are from the Petrosen website (www.petrosn.sn)

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Devonian shale, although not encountered in wells DM-1 or KO-1 may be present in the basin and is found at outcrop in the Bove Basin (Bafata Shale). Infra-Cambrian shale intervals are known from the Taoudeni Basin and may have sourced the gas tested at Texaco’s Abalog-1 well in 1974. Thick sections of Cambrian age shale are at outcrop in the Bove Basin. In Senegal any Cambro-Ordovican source rocks would likely be gas prone.

Petrosen studies confirm the Silurian as relatively organic rich. Other geochemical indicators as measured at DM-1 and Ko-1 wells –Tmax, Vitrinite Reflectance (0.95 – 1.3), HI, the presence of pyrophylliote indicate high thermal evolution of the organic matter. Given the shallowness of the wells these values may be due to locally high geothermal gradients. The presence of dolerites may be the cause of these local heating effects. An alternative explanation is that the Silurian shales were buried very deeply and subsequently uplifted by the Hercynian orogeny - as may have occurred in the Taoudeni Basin. However, analysis by PCIAC / BEICIP indicates no break in the maturity profile between the Cenozoic / Mesozoic intervals and the underlying Palaeozoic. They favour a local heating effect at play in the Casamance wells, given their proximity to a prominent east-west lineament (Bissau-Valingara-Kidira)

Petrosen also completed several burial history models using normal geothermal gradients (28C / km). This

model suggests an onset of generation at 125 MYO, peaking at 118MYO and continuing to present day, with the oil window in the interval 1850m-3450m.

Geochemical analyses form DM-1 and KO-1 (Petrosen / BEiCiP)

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Palaeozoic Petroleum system Element (from Brownfield & Charpentier)

seals, Timing and TrapsAny Devonian sandstones reservoirs may be sealed by Upper Devonian shale. Ordovician reservoirs are interspersed with shale layers and fractured Ordovician reservoirs may be covered by Silurian shale. Any reservoirs found in the syn-rift sequences are likely, by analogy, to have intra-formational seals (Eassouria basin, Gabon, Cabinda).

The regional seismic grid provides compelling evidence for multiple trapping styles. In southern Senegal (Casamance) 1980’s and 1990’s vintage 2D seismic indicates simple tilted fault blocks. Note the DM-1 and KO-1 wells pre-dated this seismic and these wells may not have been drilled on viable structures. In northern Senegal and in the Louga block the style is markedly compressive. Here east-west dip lines of 1970’s seismic indicate high amplitude thrusted fault structures and broad fold anticlines. Although there is inadequate seismic to define individual defined closures the areal dimensions of these features may be very large.

The Louga Block is well positioned in terms of widespread Ordovician age clastic reservoir deposition. The combined effects of Hercynian and Caledonian age orogenies have caused significant fracturing and the creation of excellent secondary porosity in the reservoirs.

The Silurian “Tannezuft” is the major source rock in Saharan basins of North Africa and significant volumes of oil and gas have been generated and trapped. The Senegal Palaeozoic Basin is at the southern limit of Silurian marine shale deposition.

SOUTHAMERICA

ORDOVICIAN PALAEOGRAPHY

AFRICA

Marine Deposits

Direction of Continental Sediment Supply

Direction of Marine Transgressions

Epi-Continental Deposits

Continental Deposits

Lava

Glacial Deposits

Faults

MaranhaoBasin

Florida AF

RI

CA

G U Y A N A

B R A Z I L

Dakar

LougaBlock

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The Silurian “Tannezuft” is the major source rock in Saharan basins of North Africa and significant volumes of oil and gas have been generated and trapped. The Senegal Palaeozoic Basin is at the southern limit of Silurian marine shale deposition.

LOWER SILURIAN PALAEOGEOGRAPHY

SOUTHAMERICA

AFRICAMarine Deposits

Epi-Continental Deposits

Glacial Deposits

GHANA

GUINEA

MAURITANIA

GUYANAFLORIDA

AF

RI

CA

LougaBlock

N

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T5 Oil & Gas Technical studies Completed in 2014Gravity & Magnetics: T5 undertook a reprocessing of available gravity / magnetic data from Northern Senegal. The work was completed by Getch (UK). The results provided very useful insights to: depth of basement, distribution of volcanic bodies, location and form of sub-basins (possible source kitchens) and the pattern of major structural elements. These data were integrated with available regional seismic and support the possibility of a syn-rift play along the central axis of Louga.

Reprocessing of shell 2D seismic: A selection of 1970’s vintage 2D (Shell) was reprocessed by Prospectiuni. The primary objective was to validate the structural leads interpreted on original data. Although having poor resolution and quite noisy, the reprocessing confirms the presence of significant scale Palaeozopic structures- thrusts, on-laps, sub-crops and anticlines. There is also evidence for lower amplitude structures in the Cretaceous section; the area of north-west Senegal appears interesting. The reprocessing supports a programme of new 2D acquisition in the area east of St. Louis in the north, and in southern area near Sagata.

Multiple Plays in the louga Block• The primary play in the Mesozoic comprises Devonian and Orodovician reservoirs trapped in large scale structural traps (folds,

thrust fault blocks) sourced by silurian shale and sealed by silurian and intra-formational seals. Stratigraphic or combination traps – sub-crop of Palaeozoic reservoirs to the base Mesozoic unconformity- may be viable and there is clear seismic evidence for this on the regional 2D data. The DM-1 and KO-1 in the southern limit of the Senegalese Palaeozoic Basin verify the presence of these potential source, reservoir, seal combinations and regional seismic data indicate the development of high amplitude structures with the possibility of very large areal closures. These features require definition by new seismic prior to drilling. They lie within accessible drilling depths in the range 1200m- 4000m.

• Conceptual plays also exist for infra-Cambrian reservoirs again in structural traps sourced by offset Silurian, Devonian, infra-Cambrian shale. The play is more likely to be a gas bearing.

• Syn-rift plays may be developed in the deeper parts of the Senegal Palaeozoic Basin. New seismic should shed considerable light on the potential for this play.

• Palaeozoic non-conventional play. Ongoing studies of Palaeozoic age shale reservoirs in North Africa indicate the potential for very large resources e.g. Algerian basins are estimated to have potential for 20TCM of technically recoverable shale gas. The primary shale formation here are Silurian (Tannezuft) shale and Devonian (Frasnian shale). There are many similarities with the Palaeozoic section of the Senegal basin. It is certainly worthwhile to assess the potential for non-potential resources in the course of normal evaluation and logging / coring activities deployed for conventional reservoirs evaluation.

• Mesozoic Proven Play. In Senegal this comprises clastic Cretaceous age reservoirs sourced by Turonian age shale in shallow to intermediate depth structural / combination traps. Existing production is from the Gadiaga Field complex ( by Fortesa) and historic production by Tullow Oil / Petrosen at Diam Niadio. The north-western sector of the Louga block appears to have significant structural development with potentials for traps development- further seismic is required to define specific targets.

• Lower Cenomanian and Aptian /Neocomian reefal structures, sourced from offset Turonian-Cenomanian shale and Lower Albian shale with intra-formational seals. Such combinations are seen south-west of the Louga block in the Dakar peninsula area.

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leads and Resource PotentialA combination of gravity and magnetic data, regional seismic and well data allow the definition of a central play fairway running north south through the Louga Block and extends to c.10,000 sq.km. Depths to potential targets within the Palaeozoic range from 1200 m to 4500 m with this zone, further west the Palaeozoic depends rapidly beyond economic drilling depth.

Two primary lead areas are identified on existing seismic. In north-western Louga large scale thrusted anticlines are developed0 these are extensive (in an east west sense) and high amplitude (several hundred metres of relief). They require definition by new seismic, but closed structures are large enough to host very significant oil / gas resources (<1 TCF, 150 MMBO+).

The main play fairway in Louga runs in a 100 km. wide north-south strip through the Louga block.

Zone of interest is c. 10,000 sq.km.

Target depths for Palaeozoic reservoirs lie in the range 1200-4500m.

Access is easy and terrain is flat lying allowing ease of seismic operations

0 50KM

LOUGA: PALAEOZOIC PLAY FAIRWAY

DAKAR

DEE

PER

PAL

AEO

ZOIC MAIN

PALAEOZOICFAIRWAY

SH

ALL

OW

PA

LAE

OZO

ICO

R B

AS

ME

NT

OU

TCR

OP

PALA

EO

ZOIC

NO

N-P

RO

SP

EC

TIV

E

Eastern Edge ofPalaeozoic Fairway

AREA OF BLOCK27,000 sq.km.

Saint-Louis

Linguere-2863-945M (Basement)Schists, with verticalschistosity. Pan-AfricanBasment?

Linguere-1T.D.973mCretaceousSandstones & Shales

Gassane-1 T.D.737mGranitic BasementGranodoritesSalt water in shaleySenonian sands.

N’Diordri-1 T.D.911mSandy argillitesE.Limit of sedimentaryPaleozoicMeta-basement at T.D.

Dion Manan T.D.177m

Korkol-1T.D.583m

Kolobane T.D.2561mBasement at 2481M

Sagata-1 T.D.1717mIn Cretaceous

Leona-2 T.D.1150mUpper cretaceous

Toundou Bisset-1 T.D.4002mIn NeocomianTuronian at 1611mGood Mesozoic reservoirsbut no seals

Leona-1Lwr. Cretaceousat T.D.708m

Louga-1On flank of Leona BatholithT.D.4040m in JurassicNo source.

Diourbel-1 T.D.4153mWesternmost Palaeozoic well49m of highly fracturedbrown-pink DioritesNo metamorphismin overlying sectionplant fragments.Carboniferous?

Tienaba-1 T.D.3403mLwr. Cretaceousgas shows.

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Depth to Basement & Structural Elements. Getech 2014 Northern Senegal Project

Possible Syn-Rift Basin. Getech 2014 Gravity & Magnetics Northern Senegal Project

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louga Block Play Fairway

louga, Northern area Regional 2D seismic line

(Note: thick pre-Mesozoic interval and high relief thrusted anticlines)

The north-western area also has indication of shallower structural trap potential in Cretaceous section, again this area will be covered with new seismic.

The other currently identified lead area lies along the southern perimeter of Louga, adjacent to the Diourbel Block. Here there are very large scale fold and thrust fault features 20-30 km east-west dimensions with several hundred meters of relief.) Again, if these are delineated as closed traps by new seismic, the potential size of the features is such that they could host very large hydrocarbon accumulations.

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southern louga, lead “a” (from shell Regional line D-07/08)

(Note very large fold structure at intra-Palaeozoic level (c. 30.km east-west dimension)

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licence Periods: 3 years / 2 years / 2 years (to July 2020)

Technical Programme:

Exploration Period 1 (to July 2016)

acquire 1100 km of 2D seismic, drill one exploration to 3000m*

Exploration Period 2: (to July 2018)

Drill one exploration well

Exploration Period 3 (to July 2020)

Drill two exploration wells

*wells may be terminated at shallower depth given certain geological outcomes.

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louga - licence

Reprocessing Project 2014 (1970’s Shell 2D). High Amplitude Thrust Feature in Palaeozoic

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louga Production sharing agreement: Commercial aspectsCost Recovery: 65%

Petrosen Buy-back: Petrosen are carried for 10% through Exploration Phase. They may increase their participation to 20% in a development - and pay their share of costs going forward.

Contract stability Clause: Defined in Louga PSA

Production sharing splits

scoping Economic analysisScoping field commercial analyses* were prepared using the final PSA Production Sharing splits and Cost Recovery for type accumulations of 1TCF of gas and 150 mmbo of oil. Smaller sized accumulations are also attractive development options, given the contract terms and the presence of a ready market in the region.

*economic review by Kane Consultants

senegal Energy Market and infrastructureThe Senegalese economy is growing at c.4% per annum. A major limiting factor is access to an indigenous fuel stock supply. There is limited access to electricity outside of the major population centres, and rural electrification is an energy policy priority.

Petroleum Products consumption: 40,600 bopd. Small refinery in Dakar (1.2 Mt p.a.)

Power Generating sector*: Year 2012 installed capacity is 605 MW. Generating capacity Requirement by 2017 is 1490MW Generating stock is in poor condition. SENELEC the power utility has ongoing financial problems and private power schemes are now being encouraged. Currently 85% of generation is from imported, expensive liquid fuel. Generation costs are $34 / Kw, with a subsided sales price if $23.6 / Kw. There is therefore a ready market for indigenous oil and gas. There is currently small scale onshore gas production c.4mmscfd sold to SENELEC, private generators and an industrial user at $9 /mcf gas price.

*Ministry of Energy data

Oil Case Gas Case

Barrels / day State% Joint-venture %0-10000 38 6210000-20000 50 5020000-40000 58 42>40000 65 35

MMscf/d State % Joint-Venture %0-90 35 6590-180 45 55180-270 58 42>270 65 35

150 mmbo Oil FiElDJ-V for an 80% WI, assume $80 / barrel oil.

Assume 38 producing well, 20 water injection wells,

Producers are hydraulically fracked, well productivity 1000 bopd / well

Production facilities to 40,000bopd

Initial trucking to 8000 bopd, then 300 km. pipeline to Dakar Mbao refinery

Post Tax NPV: $3049M NPV 10% $781M

1 TCF Gas FiElDJ-V for an 80% working interest. Assume $6 gas price

38 development wells, at $10.8M / well. 20 water injection wells

Producers are hydraulically fracked, productivity is 5mmscf/d/ well

Processing facility to handle 200mmscfd. Sales to Gas Power Plant

Post TAX NPV: $1832M NPV 10% $434M

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Enquiries should be made to:

Raglan Capital

Gerry Sheehan – Exploration Director

[email protected] dial: +353 (0)1 678 5350Mobile: +353 (0)86 608 5345

John Bowe – Director

[email protected] dial: +353 (0)1 644 0002Mobile: +353 (0)86 865 9208

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