Kinetiko Energy Ltd provides an update on its major offshore gas exploration and production activities

Kinetiko Energy Ltd. has provided the following update on its major onshore gas exploration and production development activities. Exploration of the Korhaan project focused on gas-filled sandstones, coal and other carbonaceous structures over an interval of 130 m to 450 m. In all three wells, gas was produced from the upper zones immediately below the casing dolorite, and in all cases it remained producing gas almost to the final depth. On average, more than 100 m of gas-rich sandy pay zone was found per well. Korhaan-3 and Korhaan-4 have tested at commercial production rates, while Korhaan-5 appears to have landed in a smaller compartment, supported by an adjacent large compartment, separated by a thin dike wall, and is currently providing sub-commercial flow rates. The gas from Korhaan-5 can be used to complement the GTP project, but plans are under consideration to redrill the well with an inclined hole to break through the dam into the adjacent space and optimize the gas flow potential. Together with the existing Korhaan-1 and Korhaan-2 wells, also known as “The Beast” and “Son of the Beast” (which have not shown gas depletion for over ten years), the gas from these 5 wells is expected to exceed GTP.- the project and provide the advantage of being able to control production to better support the life of the reservoir. Kinetiko works with highly experienced Gas-To-Power partners, Vutomi Energy (Pty) Ltd. The program involves using existing wells in Amersfoort to produce gas for a containerized generator located in the field, which is connected to the existing grid that runs through the farmland. In the first phase, the generator will be commissioned and tested to reach a capacity of 1 MW. Additional phases are planned for the modernization of conductors and transformers to enable a scalable modular increase in power up to 5MW. The GTP project is planned to be carried out in three phases: Phase 1: Test run of the drive, where gas is supplied from a single well to the generator and the equipment is commissioned for several days to perform load and compliance tests and to prove reliability of the equipment and the machines. Phase 2: Connection and supply to the community’s existing electricity grid with an initial capacity of 1MW, which is already conceptually sold at the domestic spot price to a customer in nearby Mpumalanga. Phase 3: Expansion of infrastructure and addition of machine modules to increase production by 500% (already approved by Eskom). Status: Eskom has issued permits for the electricity production and their design approvals for both power levels. Final permits are expected to proceed shortly. The Vutomi generator is undergoing a full service and functional test program and will be ready to move to site early in the fourth quarter. The company is in the process of finalizing negotiations for the purchase of a gas collector separator, a dehydrator system and an infield water treatment solution to enable controlled gas flow to the Vutomi infrastructure in accordance with engine intake specifications. The company has engaged the independent gas certification group Sproule to perform an independent assessment of the gas reserves and/or sources of exploration rights 271. The area of ​​ER 271 is 1,287 km2, while the company’s total exploration rights (and applications) amount to 6,998 Km2. The Sproule report is estimated to be ready by the end of October 2022. The company’s exploration program is being relaunched with a core drill scheduled for September 2022. KV-14C will be the closest drill to the Eskom-operated Majuba power station (which can be gas-fired) and is expected to continue . demonstrating the gas-filled sandstone geology that historical exploration in the area has shown to be predominant. Aeromagnetic surveys have revealed strong targets for potential gaseous spaces in the area and the company has entered into an agreement with the local landowner for access to the site to begin drilling in the third quarter of 2022. Additional test wells are planned at Exploration Right 272 near the Sasol-owned Secunda Synthetic Fuel Plant and at Exploration Right 270, where aeromagnetic soundings have identified the most promising targets for gas-filled spaces. At least three exploration wells will be drilled in the fourth quarter of 2022 and the first quarter of 2023 in each of the exploration rights.

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