LONDON, Apr. 26 -- The Kenyan Ministry of Energy has approved three offshore production-sharing contracts for Dana Petroleum PLC, the UK independent said Thursday.
Blocks L5, L7, and L10 cover 35,000 sq km and represent more than half of the country's licensed offshore territory.
Dana, as operator, will hold an 80% stake in the production-sharing contracts, while Star Petroleum International Kenya Ltd. will have 20%.
Each PSC calls for completion of technical studies that will determine potential future seismic programs and exploration drilling.
"Existing seismic data indicates the presence of a number of significant geological structures in the unexplored deeper-water areas," noted Dana, adding that an "active petroleum system" in the region was confirmed by several old onshore and shallow-water wells that had encountered hydrocarbon shows.
Reprocessing of the seismic data in hand with "modern" techniques and satellite oil seep studies is underway, the company said.
Dana will pay $300,000 toward past costs associated with these licenses and finance the early stages of exploration.
"Kenya fits well with Dana's strategy of early entry into large and attractive new exploration regions, ahead of the majors," said Chairman Charles Smith.
Meanwhile, Dana reported its best-ever gross profits, excluding exceptionals, of £13.6 million in 2000, more than triple the figure recorded in 1999, and turnover for the year which climbed 44% to £29.9 million.
By the end of 2000, Dana's reserves had risen 10% to 102 million bbl, while average production had increased to 6,473 boe/d, up slightly from 6,119 boe/d in 1999.