Red Emperor Resources has declared that its joint venture partner and Puntland PSA operator, Africa Oil Corp has signed a landmark contract with Sakson Drilling and Oil Services who will provide a 1,500 horse-power, top drive drilling rig to drill two highly anticipated exploration wells in the frontier state of Puntland, Somalia.

The majority of the drilling-related third party service contracts have been entered into with the mobilization of required personnel and equipment to commence which will allow for the spudding of the first well during the fourth quarter of this year.

Drilling locations have been selected over two robust prospects each targeting gross best estimate oil in place of circa 900 million barrels. The first prospect, Shabeel-1, is targeting in excess of 300 million recoverable barrels of oil. Red Emperor has an option to participate in the second well.

The Puntland Government and Dharoor Valley communities have assured they will assist and support the joint venture to allow the project to move forward safely and expeditiously.

Africa Oil will hold its interest in the Puntland Projects through its shareholding in Horn Petroleum, who recently completed a $41m capital raising.

Red Emperor's executive director Greg Bandy commented: "We are delighted that our JV partner has signed a drilling rig contract and associated contracts and we look forward to drilling the first exploration wells in Puntland in over 20 years."

Tags: Africa Oil Corp.