Kenya Block 1

Block 1 is located on the western margin of the Mandera-Lugh basin in northeastern Kenya bordering both Somalia and Ethiopia. The block covers an area of 31,850km² (7.9 million acres). The operator is Black Marlin (50%), with Lion Petroleum owning the remaining 50%. Black Marlin's net area under licence is 15,891km² (3.9 million acres).

Early exploration occurred during the 1970's when Burmah Oil conducted gravity and seismic surveys over Block 1. This was followed during the 1980's when Amoco and Total acquired a combined 850 kilometers of 2-D seismic data. After this exploration effectively ceased until Lion Petroleum was awarded the block in October 2007. EAX farmed into the block in January 2009 taking a 50% interest and becoming operator of the block. The main exploration potential in Block 1 is believed to lie in the Jurassic and Upper Triassic section by analogy with the Ogaden basin. Gas is the most likely hydrocarbon type if present in the Mansa Guda reservoirs as the Elgal shales (the source rock) are likely to be within the gas window or over mature. The Jurassic reservoirs are more likely to be oil bearing as there is a separate potential source rock which may not have been buried so deep. An oil seep close to the well Tarbaj-1 in the southwest corner of the block confirms the presence of hydrocarbons.

The Mandera-Lugh sedimentary basin is located in north-eastern Kenya and continues partly into Somalia and Ethiopia where it is connected to the much larger and extensive Ogaden basin (see description of the Black Marlin Ethiopian assets). Analogies with the Ogaden basin also suggest there may be other potential source rocks and reservoirs. The Bur Mayo and the Kalicha-Seir formations in the Mandera-Lugh basin appear comparable to the Lower and Upper Hamanlei (Jurassic) formations in the Ogaden basin. If analogous these formations should have high total organic content ("TOC") source rocks and in addition permeable reservoirs.