pro active5 Jun 2014 09:33
Frontier Resources released an update for its operations in Oman. In its initial study of the available 2D seismic data for the wholly-owned Block 38 in the Rub Al Khali Basin, Oman, the company has identified new geologic horizons. This has helped the company in identified several new potential exploration targets, including formations in the Precambrian – Cambrian units. Besides, Frontier is planning reprocessing of about another 400 km of this 2D seismic data to assess the potential for an Ara formation intra- salt play at the block. Frontier aims to advance the identified leads to prospect level through acquisition of further seismic data under its planned 3D seismic survey.
Our view: Positive results from seismic studies at the Block 38 in Oman, with an expansive surface area of 17,425 sq km, highlight the attractive prospectivity of the block. The similarity between hydrocarbons at the Precambrian – Cambrian units to those at the Khazzan – Makarem Field in central Oman, currently under development stage, lend further weight to the resource potential of these formations. The upcoming reprocessing of existing 2D seismic data would give the company further clarity regarding the degree of presence of an Ara formation within the prospect. As for the licenses in Namibia and Zambia, a potential partnership with suitable industry peers is likely to accelerate the progress of the ongoing projects through enhanced funding, and knowledge & expertise of the potential partners. In light of these milestones and an aggressive exploration strategy, we remain optimistic about Frontier’s future growth prospects and retain a Speculative Buy.