"The Lake Tanganyika South Block provides Beach an opportunity for ground floor exploration in an area with similar geology to, and on trend with, a proven petroleum basin," managing director Reg Nelson said.

"Lake Tanganyika has, until now, been poorly explored. However, seismic data acquired by Duke University in the early 1980s shows similar structures to those which have produced oil fields in Uganda to the north.

"Reported oil seeps in the lake indicate a working hydrocarbon system is present and

suggest the potential for large petroleum accumulations in the permit area."

Beach will have to negotiate the terms of a production-sharing agreement for the 5400 square kilometre South Block onshore and in the waters of the southern half of Lake Tanganyika.

South Block forms part of the western arm of the 6400km-long East African Rift system as does Lake Albert.

Previous exploration in the Ugandan portion of the Albert Basin by Hardman Resources and Heritage Oil has resulted in oil discoveries with potential reserves of between 100 million to 1 billion barrels.