Africa Oil Corp. is a Canadian oil and gas exploration company with interests in exploration licenses in Kenya, Ethiopia and Somalia.

Africa Oil jumps on Ekales discovery

The discovery alleviates some of the risk involved with exploration at the well, Africa Oil said, where it holds a 50% interest along with partner Tullow Oil Kenya.

Shares of Africa Oil (CVE:AOI) have spiked more than 5% to their highest level so far this year after the exploration firm said it discovered oil at its Ekales well.

The Vancouver-based company said the discovery at Ekales, where drilling began in July, was at Block 13T. An analysis of wireline logs and samples show a "potential pay zone of 60 to 100 metres," which the company said it will confirm by flow testing.

The discovery alleviates some of the risk involved with exploration at the well, Africa Oil said, where it holds a 50% interest along with partner Tullow Oil Kenya.

Additionally, Africa Oil said another well in Block 13T, the Agete-1, is drilling after it was spud on Sept. 16. The well has a pre-drill prospective resource estimate of 276 million barrels of recoverable oil with a chance of success of 54%, the company said.

The Bahasi-1 well in the Kenya Block 9 Bahasi prospect is expected to spud in the next few days, to be operated jointly with venture partner Marathon Kenya Limited B.V., a wholly-owned subsidiary of Marathon Oil Corp. (NYSE: MRO), which will pay for drilling activity. The pre-drill prospective resource estimate of this prospect is 320 million barrels of recoverable oil.

The Tutule-1 well, spud on September 21 in the South Omo Block in Ethiopia, will test the Tertiary rift play in a well-defined horst block feature near to the recently drilled Sabisa-1 well. Africa Oil is partnered in South Omo with Tullow Oil and Marathon Ethiopia Ltd. on the project.

Meanwhile, the El Kuran well in Ethiopia, operated by New African Global Energy, is expected to spud in October. Africa Oil is also mobilizing two lightweight rigs for testing and shallow drilling in northern Kenya and expects them to be operational in the fourth quarter.

The company's stock has moved 27% higher so far this year.