The 2015 work program has been primarily focused on appraisal of the discovered South Lokichar Basin with the following objectives; confirming reservoir quality and deliverability, resource size and definition, and advancement of the development plans, including the export pipeline. The Company entered the year with three drilling rigs active in Kenya. Two rigs were demobilized during the year. One drilling rig was active at the end of 2015 and is expected to be released in the first quarter of 2016. A limited number of potential basin opening wells were drilled in Kenya during 2015 outside of the discovered South Lokichar Basin. In Ethiopia, efforts during the year were focused on a 2D seismic program in the Rift Basin Area Block.

Tertiary Rift - Kenya

In January 2015, the Company announced the completion of drilling the Ngamia-5 and Ngamia-6 appraisal wells. Ngamia-5 is located 500 metres northeast of the Ngamia-1 discovery well in a different fault compartment and encountered 160 to 200 metres net oil pay. Ngamia-6 is located approximately 800 metres north of Ngamia-1 and in the same fault compartment as Ngamia-5 and encountered up to 135 metres net oil pay.

During the first quarter of 2015, the Epir-1 exploration well was drilled to a total depth of 3,057 meters in the North Kerio Basin in Block 10BB, Kenya. The well encountered a 100 meter interval of wet hydrocarbon gas shows with florescence indicating the presence of an active petroleum system. The hydrocarbon shows were encountered primarily in rocks which were not of reservoir quality. The partnership was encouraged that the Epir-1 well had demonstrated a working hydrocarbon system in the Kerio Basin and technical work will now focus on identifying a prospect in the basin where there is a high chance of trapping hydrocarbons in reservoir quality rock.

The Engomo-1 well was drilled in the first quarter of 2015, which was the first test of the North Turkana Basin in Block 10BA, Kenya. This prospect is to the west of Lake Turkana where numerous naturally occurring oil slicks and seeps have been observed. The Engomo-1 exploration well in Block 10BA was drilled to a total depth of 2,353 meters. The well encountered interbedded siltstones, sandstones and claystones, becoming more tuffaceous and tight until reaching a total depth in basement. No significant oil or gas shows were encountered and the well was plugged and abandoned. The prevalence of tight facies in the wellbore may be due to the well's close proximity to the basin bounding fault. Future analysis will be focused on understanding how this result impacts the remaining prospectivity in the basin.

During the first quarter of 2015, in the Ngamia field, the Ngamia-7 and Ngamia-8 appraisal wells were drilled. The Ngamia-7 well was drilled 1.2 kilometers east of Ngamia-3 and encountered up to 130 meters of net oil pay identifying a large eastern extension of the field that had been identified from the new 3D seismic survey. The Ngamia-8 appraisal was drilled and encountered up to 200 meters of net oil pay in line with pre-drill expectations. The well was positioned in the center of the Ngamia structure and static pressure data indicated the well is in pressure communication with the oil discovered in the neighbouring Ngamia-1A, Ngamia-3, Ngamia-5, Ngamia-6 and Ngamia-7 wells. During the second quarter of 2015, the drilling of the Ngamia-9 well was completed and encountered between 90 and 110m of pay in the Lokone and Auwerwer horizons.

During the first quarter of 2015 in the Amosing field, the Amosing-3 appraisal well, located one kilometer northwest of the Amosing-1 discovery, was drilled. The well encountered up to 140 meters of net oil pay and proved an extension of the field. Pressure data from the Amosing-3 well indicated connectivity in some reservoir horizons encountered in the Amosing-1, 2 & 2A wells. The Amosing-4 well, located approximately one kilometer southeast of the Amosing-1 well, was drilled to test the southern extent of the field and successfully encountered 27 meters of net oil pay in thick upper reservoir zones proving the significant down-dip extent of the field. Mapping of the Amosing field does not close the structure to the south and there is potential for the field to spill up-dip into the Ekosowan prospect area, where the Ekosowan-1 well was drilled last year encountering a 900 meter column of near continuous oil shows in tight alluvial fan facies. The Amosing-4 well has further de-risked drilling of the Ekosowan prospect.

Elsewhere in the Lokichar basin, during the first quarter of 2015, the Ekales-2 appraisal well reached a total depth of 4,059 meters and encountered an estimated 60-100 meters of net oil pay in the primary shallower objectives. This highly deviated well was also deepened to test the basin center stratigraphic play where it intersected sandstones with elevated pressures and 50 meters of oil bearing sands; however, operating conditions precluded logging and confirmation of any oil pay in this section. This was the first test of this exploration target and is very positive for the future upside potential of the South Lokichar Basin, above the significant oil resources already discovered.

In the Twiga field the Twiga-3 exploratory appraisal well in Block 13T encountered sands within the Lokone Shale sequence that are interpreted as good quality oil bearing reservoir over a gross interval of 120 metres. This result will be assessed in future exploration and appraisal activities, stepping out into the South Lokichar basin to further define this encouraging additional oil potential.

During the first half of 2015, in preparation for the EWTs, the Amosing-1 and Amosing-2A wells were successfully completed in five separate zones. Initial rig-less flow testing during clean-up flowed at a cumulative maximum rate of 5,600 and 6,000 bopd respectively. These results exceeded expectations, and demonstrated high quality reservoir sands which flowed 31 to 38 degree API dry oil under natural conditions. During the test the wells produced at a cumulative average constrained rate of 4,300 bopd under natural flow conditions. Pressure data from the two wells supports significant connected oil volumes and confirms lateral reservoir continuity, which is positive for the future development. A cumulative volume of 30,000 barrels of oil has been produced into storage. Water injection tests are being planned to further validate the viability of water flood reservoir management and the oil recovery assumptions.

The partnership has completed the Ngamia Extended Well Test production phase with approximately 38,000 barrels of oil produced. Five completed zones of the Ngamia-8 production well were tested individually at a cumulative rate of 2,400 bopd and all except the lowest zone produced without artificial lift. Communication between the producer well and an observation well, at a distance of approximately 500 metres, was also demonstrated. Water injection tests were being planned to further validate the viability of water flood reservoir management and the oil recovery assumptions.

In the third quarter of 2015, the Amosing-5A exploratory appraisal well was drilled as a test of an undrilled fault block. The well encountered an estimated 15 to 28 metres of net oil pay in a downflank position and successfully proved a northern extension to the Amosing field.

During the fourth quarter of 2015, the Emesek-1 exploration well was drilled, testing the undrilled North Lokichar basin in Block 13T. The well reached a total depth of 3,000 metres without encountering commercial hydrocarbons and was plugged and abandoned. The rig subsequently moved to the South Lokichar basin to drill the Etom-2 well in an undrilled fault block adjacent to the Etom oil discovery in Block 13T. The well encountered 102 metres of net oil pay in two columns. The objective of the well was to explore the north flank of the Etom structure in an untested fault block identified by recent 3D seismic. Oil samples, sidewall cores and wire line logging all indicated the presence of high API oil in the best quality reservoir encountered in the South Lokichar Basin to date.

Discovering this thick interval of high quality oil reservoirs at Etom-2 further underpins the development options and resource base in the South Lokichar Basin. The result follows careful evaluation of 3D seismic data which was shot after the Etom-1 well completed drilling and demonstrates how the partnership has improved its understanding of the basin. This result also suggests significant potential in this underexplored part of the block as it is the most northerly well drilled in South Lokichar and is located close to the axis of the basin away from the basin-bounding fault. Accordingly, Tullow and Africa Oil will review the resource potential of the greater Etom area and neighbouring prospects as part of a future exploration drilling program.

Following Etom-2, the PR Marriott Rig-46 moved to Block 12A where it is currently drilling the Cheptuket-1 exploration well, the first well to be drilled in the Kerio Valley Basin. Following the drilling of Cheptuket the drilling rig will be released while a future program is considered.

The full fast track processed data set for the 951 square kilometer 3D seismic survey over the series of significant discoveries along the western basin bounding fault in the South Lokichar Basin, is now available and is being interpreted. The 3D seismic indicates significantly improved structural and stratigraphic definition and additional prospectivity not evident on the 2D seismic.

In addition, the partnership acquired over 1,100 meters of whole core from the wells drilled in the South Lokichar Basin, and an extensive program of detailed core analysis is ongoing. A key focus of the core program is to better assess oil saturation and to refine the recovery factors of the main reservoir sands. Core analysis results support the reservoir assumptions used in the contingent resource estimate and are reducing the uncertainty around oil saturations in the reservoir.

The extensive appraisal activities in Kenya, including the EWTs, along with the development concept studies completed in 2014, are addressing key reservoir uncertainties around the South Lokichar contingent resource estimate. The results to date from the ongoing appraisal drilling program and Amosing EWT results provides significant comfort that the reservoir sands are connected over an area larger than the assumed development well spacing which will narrow the range of uncertainty around recovery factors.

The draft field development plan for the discoveries in the South Lokichar Basin was submitted in December 2015. Preparation for FEED is under way, and is expected to commence in 2016.

In August 2015, a bilateral agreement was reached between the Presidents of Uganda and Kenya adopting the Northern Kenya route for the regional crude oil pipeline, subject to certain conditions. Africa Oil continues to support both countries in moving this project forward as quickly and efficiently as possible taking into account the needs of all stakeholders.

Cretaceous Anza Rift - Kenya

In Block 9, the Company continues to assess the results of its 2014 drilling program. The Government of Kenya has granted an eighteen month extension to the second additional exploration period, which will now expire in June 2017.

Tertiary Rift - Ethiopia

During the third quarter of 2015 in the Rift Basin Area Block, a 2D seismic program was completed, which consisted of approximately 600 kilometers of land and lake seismic. Source rock outcrops and oil slicks on the lakes have been identified in the block where there was previously no existing seismic or wells. The Government of Ethiopia granted a twelve month extension to the initial exploration period, which will now expire in February 2017.