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Eco (Atlantic) O&G (ECO)


Tuesday 31 August, 2021

Eco (Atlantic) O&G

Results for the three months ended 30 June 2021

RNS Number : 1104K
Eco (Atlantic) Oil and Gas Ltd.
31 August 2021

31 August 2021



("Eco," "Eco Atlantic," "Company," or together with its subsidiaries, the "Group")


Unaudited Results for the three months ended 30 June 2021


Corporate and Operational Update


Eco (Atlantic) Oil & Gas Ltd. (AIM: ECO, TSX     V: EOG) the oil and gas exploration company with licences in the proven oil province of Guyana and the highly prospective basins of Namibia, is pleased to announce its results for the three months ended 30 June 2021, alongside a corporate and operational update.  


Results Highlights:




· Cash and cash equivalents of US$4.85 million (including restricted deposits) and no debt as of 30 June 2021. 

· Raised US$4.9m in the form of a private placement in July 2021.

· Total assets of US$17.9 million, total liabilities of $2.7 million and total equity of US$15.2 million as of 30 June 2021.




Eco Atlantic Oil & Gas

· Orinduik Block offshore Guyana - all seismic data reprocessing completed and multiple light sweet oil drilling prospects are being reviewed by Eco and its licence partners (the "JV Partners"), with high-graded candidates being considered for the 2022 drilling programme. The intention is to provide further definition to the upper and lower Cretaceous interpretation and target selection for drilling. Target selection is expected in Q3 2021.


· Continuing to evaluate additional asset opportunities in both West Africa and South America with its strategic partner and substantial shareholder Africa Oil Corp - focus on near-term high-impact exploration opportunities.


· Closed transaction (28 June 2021) with JHI Associates Inc. ("JHI"), a private company and holder of 17.5% working interest ("WI") in the Canje Block offshore Guyana, to acquire up to a 10% interest in JHI on a fully diluted basis (the "JHI Transaction") and appointment of Keith Hill, a non-executive Director of the Company, to the board of directors of JHI.


The JHI Transaction increases Eco Atlantic's presence in the Guyana-Suriname basin, increasing its Guyana acreage exposure from 1,800 km2 to 6,600 km2 and providing exposure to near-term drilling, with one well drilled subsequent to the JHI Transaction on the Canje Block, Jabillo-1, and further well, Sapote-1, now drilling, and at least one planned on the Orinduik Block in 2022, subject to partner approval.


Received a detailed update from JHI regarding the Jabillo-1 well in the Canje Block, offshore Guyana on 5 July 2021, which reached its planned target depth and was evaluated, but did not show evidence of commercial hydrocarbons.


ExxonMobil spud the Sapote-1 well on the Canje block, offshore Guyana, on 29 August 2021, which is expected to reach target depth within 60 days. The Sapote-1 well is the second well in the drilling programme, following the Jabillo-1 well.







· Guyana continues to be one of the most prolific exploration regions in the world, with over nine billion barrels of oil discovered in the last five years. Eco and the JV Partners* have already delivered two substantial oil discoveries on the Orinduik Block and the Block continues to offer significant upside potential. With the recent increase in oil prices, the JV Partners will revisit the Jethro discovery commercialisation potential.


· As previously reported, Eco is fully funded for further planned / near term drilling on the Orinduik Block and, with its JV Partners, is assessing all opportunities available to drill at least one exploration well into the light oil cretaceous stacked targets as soon as practical. The Company is fully aligned with its JV Partners on careful target selection for the next drilling campaign, based on the reprocessed 3D seismic data on the block and nearby oil discoveries. Eco expects to be able to update the market on further drilling plans later in Q3 2021.


· Posted by the Environmental Protection Agency ("EPA") Guyana on 8 August 2021, ExxonMobil applied for environmental authorisation for a 12-well Exploration and Appraisal Drilling Programme in the Canje Block, offshore Guyana in 2022.  


· The JHI Transaction provides the Company with immediate exposure to an active drilling programme in the Canje Block offshore Guyana. JHI updated Eco on 29 August 2021 that the Block Operator ExxonMobil confirmed the spud of a second exploration well, Sapote-1. The well operations is planned to take up to 60 days.



*The Orinduik Block JV partners are Eco Atlantic (15% working interest ("WI")), Tullow Guyana B.V. ("Tullow") (Operator, 60% WI) and TOQAP Guyana B.V. ("TOQAP") (25% WI) a company jointly owned by TotalEnergies E&P Guyana B.V. (60%) and Qatar Petroleum (40%) .





· The Company's licences in Namibia cover approximately 28,593 km2, with over 2.362 BBOE of prospective P50 resources.


· Eco has a strategically significant acreage position in-country and is progressing its various work programmes across its four blocks offshore Namibia. The Company has witnessed considerable interest from multiple international oil companies in Namibia.


· The Company continues to monitor upcoming drilling activity in the region, two high impact deepwater wells in southern Namibia, operated by TotalEnergies and Shell respectively have been confirmed to commence in Q4 2021. 


· TotalEnergies Venus-1 well using the Maersk Venturer was pushed back in 2020 and now expected to spud in Q4 2021.  It was reported on 17 August 2021, Shell Namibia have awarded the Valaris DS-10 the contract to drill Graff-1 well, expected to start in Q4 2021 with an estimated duration of 60 days.   


Solear Ltd. 

· Solear, a majority owned subsidiary of Eco, is an independent renewable energy company focused on grid-scale solar development projects in southern Europe.


· Solear's near-term objective is to develop its pipeline of solar assets with competitive rates of return through acquisition, development, and construction of solar assets, led by an experienced renewable energy team.





· Throughout the ongoing COVID-19 pandemic, Eco has prioritised the welfare of its employees and partners.


· The Company continues to keep a strict control over costs throughout the business, which continues to generate material savings, ensuring that Eco remains well capitalised with a strong balance sheet.



Gil Holzman, President and Chief Executive Officer of Eco Atlantic, commented:  


"It has been a busy period for Eco as we endeavour to realise significant value for shareholders from our world-class asset base. The JHI transaction ensured we have a near-term catalyst for potential drilling success and demonstrated our commitment to expanding our presence in Guyana, a proven and prolific hydrocarbon basin. We look forward to updating the market in due course on results from the Sapote-1 well and on timing of further drilling on the Orinduik Block, as we increase our presence and collaboration in the Guyana-Suriname Basin.


"With regard to the rest of our portfolio, we are excited about the outlook for the Company's significant acreage in Namibia, as we continue to make progress across our four licences and await the two high-impact wells to be drilled by TotalEnergies and Shell in Q4 this year. We remain committed to delivering exploration success in Namibia and will update stakeholders in due course.


"We are upbeat about the Company's prospects for the rest of 2021 and are well placed to deliver long-term success into next year. We look forward to updating all stakeholders as we move forward."   





The Company's unaudited financial results for three months ended 30 June 2021, together with Management's Discussion and Analysis for the three months to 30 June 2021, are available to download on the Company's website at and on Sedar at .


The following are the Company's Balance Sheet, Income Statements, Cash Flow Statement, and selected notes from the annual Financial Statements. All amounts are in US Dollars, unless otherwise stated.


Balance Sheet



 June 30,

March 31,






Current assets

Cash and cash equivalents



Short-term investments



Government receivable



Amounts owing by license partners, net



Accounts receivable and prepaid expenses





  Renewable energy licenses



  Investment in associate



  Right of use assets



  Security deposit



  Petroleum and natural gas licenses



Total Assets




Current liabilities

  Accounts payable and accrued liabilities



  Advances from and amounts owing to license partners, net



  Receipt on account of shares



  Short-term portion of lease liability



Total current liabilities



Lease liability



Total liabilities




Share capital



Restricted Share Units reserve



Stock options



Foreign currency translation reserve



Non-controlling interest



Accumulated deficit



Total Equity



Total Liabilities and Equity





Income Statement


Three months ended

June 30,





Interest income





Operating expenses :


Compensation costs



Professional fees



Operating costs (Note 18)



General and administrative costs (Note 19)



Share-based compensation (Note 14(i))



Interest expense (Note 11)



Foreign exchange gain (loss)



Total expenses



Net loss for the period



Foreign currency translation adjustment



Comprehensive loss for the period



Net loss for the period attributed to:

Equity holders of the parent



Non-controlling interests





Basic and diluted net loss per share attributable to equity holders of the parent



Weighted average number of ordinary shares used in computing basic and diluted net loss per share




Cash Flow Statement


Three months ended

June 30,




Cash flow from operating activities

Net loss from operations



Items not affecting cash:

  Share-based compensation



  Depreciation and amortization



  Accrued interest



Changes in non‑cash working capital:

  Government receivable



  Accounts payable and accrued liabilities



  Accounts receivable and prepaid expenses



  Receipt on account of shares



  Advance from and amounts owing to license partners





Cash flow from investing activities

 Investment in associate



 Short-term investments





Decrease in cash and cash equivalents



Foreign exchange differences



Cash and cash equivalents, beginning of period



Cash and cash equivalents, end of period




Notes to the Financial Statements


Basis of Preparation


The consolidated financial statements of the Company have been prepared on a historical cost basis with the exception of certain financial instruments that are measured at fair value. Historical cost is generally based on the fair value of the consideration given in exchange for assets.


Summary of Significant Accounting Policies


Critical accounting estimates


Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized prospectively from the period in which the estimates are revised. The following are the key estimate and assumption uncertainties considered by management.



Events After the Reporting Period


a)  Private Placement


On July 19, 2021, the Company closed a private placement financing with Africa Oil Corp. and Charlestown Energy Partners LLC issuing a total of 14,945,913 common shares and 14,945,913 share purchase warrants exercisable for 2 years at CAD$0.47.


As a result of the financing, Africa Oil Corp.'s interest in the Company is 19.99%.






For more information, please visit or contact the following :



Eco Atlantic Oil and Gas


c/o Celicourt +44 (0) 20 8434 2754

Gil Holzman, CEO

Colin Kinley, COO

Alice Carroll, Head of Marketing and IR



+44(0)781 729 5070 | +1 (416) 318 8272

Strand Hanson Limited (Financial & Nominated Adviser)


+44 (0) 20 7409 3494

James Harris

Rory Murphy

James Bellman


Berenberg (Broker)


+44 (0) 20 3207 7800

Matthew Armitt

Emily Morris

Detlir Elezi


Celicourt (PR)


+44 (0) 20 8434 2754

Mark Antelme

Jimmy Lea

Ollie Mills

Hannam & Partners (Research Advisor)

Neil Passmore


+44 (0) 20 7905 8500



The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulation (EU) No. 596/2014 as it forms part of United Kingdom domestic law by virtue of the European Union (Withdrawal) Act 2018.


Notes to editors:


About Eco Atlantic:


Eco Atlantic is a TSX-V and AIM quoted Oil & Gas exploration and production Company with interests in Guyana and Namibia, where significant oil discoveries have been made.


The Group aims to deliver material value for its stakeholders through oil exploration, appraisal and development activities in stable emerging markets, in partnership with major oil companies.


In Guyana, Eco Guyana holds a 15% Working Interest alongside TOQAP Guyana B.V. ("TOQAP") a company jointly owned by TotalEnergies E&P Guyana B.V. (60%) and Qatar Petroleum (40%) and Operator Tullow Oil (60%) in the 1,800 km2 Orinduik Block in the shallow water of the prospective Suriname-Guyana basin.  The Orinduik Block is adjacent and updip to ExxonMobil Operated Stabroek Block, on which twenty discoveries have been announced and over 9 billion BOE recoverable resources are estimated.  On 28 June 2021, Eco acquired a 6.4% interest, with the option to increase its stake to 10%, in JHI Associates Inc. a private company which holds a 17.5% WI in the 4,800km2 Canje Block. The Canje Block is operated by ExxonMobil and is held by Working Interests partners Esso Exploration & Production Guyana Limited (35%), with TotalEnergies E&P Guyana B.V. (35%), JHI Associates (BVI) Inc. (17.5%) and Mid-Atlantic Oil & Gas Inc. (12.5%).


Jethro-1 was the first major oil discovery on Orinduik Block. The Jethro-1 encountered 180.5 feet (55 meters) of net heavy oil pay in excellent Lower Tertiary sandstone reservoirs. Joe-1 was the second discovery on the Orinduik Block and comprised of high quality oil-bearing sandstone reservoir, with a high porosity of Upper Tertiary age. The Joe-1 well encountered 52 feet (16 meters) of continuous thick sandstone. 


In Namibia, the Company holds interests in four offshore petroleum licences totalling approximately 28,593km2 with over 2.362bboe of prospective P50 resources in the Walvis Basin.  These four licences, Cooper, Guy, Sharon, and Tamar are being explored with industry partners with Eco Operating and maintaining an average 60% Working Interest.  Eco has been granted a drilling permit on its Cooper Block (Operator).


Eco Atlantic is a 70% shareholder in Solear Ltd., Solear is an independent private clean energy investment company focused on low cost, high yield solar development projects in southern Europe.  Solear offers investors exposure to a portfolio of pre-construction opportunities across the renewable energy value chain, from Ready-to-Build to early-stage development. 

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