- San Leon [LON:SLE] was the sector's biggest riser - up by over 17.9% in late trading - after noting the takeover speculation regarding the company and confirming that it has received an approach from a possible offeror, which may or may not lead to an offer being made.

This announcement does not constitute an announcement of a firm intention to make an offer under Rule 2.5 of the Takeover Rules.

There can be no certainty that an offer will be made or as to the terms on which any offer might be made.

A further announcement will be made, as appropriate, in due course.

* * *

Aminex [LON:AEX] has now received formal approval from Tanzania's minister of energy and minerals to extend the current work period of the Nyuni Area PSA for a period of four years until at least 27 October 2019. The company has now formally accepted the Carol-2 rig following inspection by an independent surveyor and says Ntorya-2 drilling operations in the Ruvuma Basin began at the weekend. Spudding of Ntorya-2 is expected in the next few days.

* * *

BP [LON:BP.] has agreed a deal with Kosmos Energy to partner on world-class discoveries in Mauritania and Senegal and been awarded a 10% interest in Abu Dhabi's ADCO onshore concession.

BP has signed agreements with Kosmos Energy to acquire a 62% working interest, including operatorship, of Kosmos's exploration blocks in Mauritania and a 32.49% effective working interest in Kosmos's Senegal exploration blocks --acreage which holds world-class deepwater gas discoveries and exploration prospectivity across both countries.

The approximately 33,000 square kilometres of acreage covered by today's agreements includes the Tortue field, estimated by Kosmos to contain more than 15 tcf of discovered gas resources. The total acreage, by Kosmos' estimates, could contain roughly 50tcf of gas resource potential and in excess of 1 billion barrels of liquids resource potential.

BP will invest nearly $1bn mostly in the form of a multi-year exploration and development carry to acquire a 62% interest and operatorship of offshore Blocks C-6, C-8, C-12 and C-13 in Mauritania and an effective 32.49% interest in the Saint-Louis Profond and Cayar Profond blocks in Senegal.

BP chief executive Bob Dudley said: "BP's entry into Mauritania and Senegal represents an exciting strategic opportunity to work with Kosmos Energy in an emerging world-class hydrocarbon basin. We believe our expertise in integrating the gas value chain, together with a talented exploration partner in Kosmos, along with the support of the Mauritanian and Senegalese governments brings together all the elements needed to create a new LNG hub in Africa."

BP has aslo signed an agreement with the Supreme Petroleum Council of the Emirate of Abu Dhabi and the Abu Dhabi National Oil Company (ADNOC) that grants BP a 10% interest in Abu Dhabi's ADCO onshore oil concession, which has a life of 40 years.

In addition to the interest in the ADCO concession, BP becomes a 10% shareholder in ADCO, the Abu Dhabi Company for Onshore Petroleum Operations Limited, which operates the concession. The agreement includes BP becoming asset leader for the Bab asset group within the concession.

In connection with the transaction, BP has agreed to issue new ordinary shares representing approximately 2% of BP's issued share capital (excluding treasury shares), to be held on behalf of the Abu Dhabi Government. The issuance of the new ordinary shares is subject to certain listing requirements and is expected to be completed shortly.

* * *

Solo Oil [LON:SOLO] said spudding of the Ntorya-2 appraisal well is expected in the next few days.

It said that Aminex, operator of the Ruvuma PSA in Tanzania, has advised that the Caroil-2 rig has been formally accepted on contract following inspection by an independent surveyor and that Ntorya-2 drilling operations commenced over the weekend.

The Ntorya-2 well is planned to be drilled to an estimated total depth of 2,860 metres and is targeting the same sandstone channel complex as found at Ntorya-1, but located further up-dip.

The well location is approximately 1,500-metre southwest from the Ntorya-1 discovery which (as reported in June 2012) flowed gas at 20 million standard cubic feet per day, with 139 barrels of associated condensate, from a 3.5-metre sandstone interval on test.

Solo has a 25% non-operating interest in the Ruvuma PSA and in the Ntorya-2 well.

* * *

Volga Gas [LON:VGAS] has issued an update on its drilling activities on a sidetrack to the Uzen #4 oil well.

Volga Gas has been drilling a sidetrack to its Uzen #4 oil well with the intention of accessing a potentially unproduced zone of the Aptian reservoir of the Uzen oil field, which is the reservoir that has been developed and produced to date.

The quantity of additional reserves in the Aptian is likely to be modest, but would provide profitable additional production.

Should the anticipated Aptian oil not be present in economic volumes, the plan would be to use the same borehole to drill a horizontal well in the shallower Albian reservoir.

Drilling to date confirms that there is a sufficiently thick oil leg in the Albian, consistent with management's estimate of 1.5 million barrels of oil reserves recoverable from a horizontal well.

In the case of success with the sidetrack in the Aptian, a new horizontal well is to be drilled from a surface location close to Uzen#4.

However, during the drilling of a deviated section from the existing vertical well mechanical difficulties were encountered.

The drill bit and certain directional drilling tools supplied by Schlumberger became stuck in the well, as a result of a faulty pump interrupting drilling mud circulation.

Various attempts have been made to release the stuck drill bit and to retrieve the directional drilling tools but unfortunately they have proved unsuccessful.

Consequently management have taken the decision to abandon any further attempts. Given the attractiveness of accessing incremental reserves in a side track well, Volga Gas will recommence drilling a sidetrack after appointing a new drilling contractor.

Volga Gas may, however, incur costs of up to $2.0 million including compensation for replacement of the directional drilling tools belonging to Schlumberger.

Volga Gas will seek to recover such costs from the drilling contractor which the Company considers to have been responsible for the problems. However, it may be prudent to make a provision for some or all of these costs in the 2016 Income Statement.

At 4:21pm:

[LON:AEX] Aminex PLC share price was +0.03p at 2.12p

[LON:AUR] Aurum Mining PLC share price was -0.1p at 5.65p

[LON:BOR] Borders Southern Petroleum PLC share price was +0.03p at 2.78p

[LON:BP.] BP PLC share price was +0.83p at 490.53p

[LON:CHAR] Chariot Oil Gas Ltd share price was -0.44p at 8.41p

[LON:ENQ] EnQuest Plc share price was +1.63p at 42.63p

[LON:GKP] Gulf Keystone Petroleum share price was -6p at 129p

[LON:GPX] Gulfsands Petroleum PLC share price was -1.75p at 8.13p

[LON:INDI] Indus Gas Ltd share price was -0.87p at 284.13p

[LON:PET] Petrel Resources PLC share price was 0p at 5.5p

[LON:RKH] Rockhopper Exploration PLC share price was +0.63p at 19.88p

[LON:RPT] Regal Petroleum PLC share price was 0p at 3.61p

[LON:SLE] San Leon Energy PLC share price was +7.76p at 50.88p

[LON:SOLO] Solo Oil PLC share price was -0.02p at 0.27p

[LON:VGAS] Volga Gas PLC share price was -3.5p at 48.5p

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