Eco (Atlantic) Oil and Gas Ltd Announces Unaudited Results and Corporate Update
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Eco (Atlantic) Oil and Gas Ltd Announces Unaudited Results and Corporate Update

Wednesday, February 26, 2020 2:00 AM
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TORONTO, ON / ACCESSWIRE / February 26, 2020 / Eco (Atlantic) Oil & Gas Ltd. (AIM:ECO)(TSXV:EOG), the oil and gas exploration company with licenses in Guyana and Namibia, is pleased to announce its results for the three and nine months ended 31 December 2019, alongside a corporate and operational update.

Results Highlights:


  • As at 31 December 2019, the Company had cash and cash equivalents of CAD $25.4 million with no debt and remains fully funded for its share of further appraisal and exploration drilling at Orinduik Block offshore Guyana of up to US$120m (gross).
  • As at 31 December 2019, Eco had total assets of CAD $27 million, total liabilities of CAD $0.3 million and total equity of CAD $26.7 million.

Operations - Guyana

  • On 12 August 2019, the Company announced a major oil discovery on its Orinduik offshore petroleum license in Guyana (the "Guyana License"). Evaluation of logging data confirms that Jethro-1 is the first discovery on the Guyana License and comprises high quality oil-bearing sandstone 55m reservoir of Lower Tertiary age. The well was cased and is awaiting further evaluation to determine the appropriate appraisal activity.
  • On 16 September 2019, the Company announced a second oil discovery on the Guyana License. Evaluation of MWD, wireline logging and sampling of the oil confirms that Joe-1 is the second discovery on the Orinduik License and comprises a high-quality oil-bearing sandstone 16m reservoir with a high porosity of Upper Tertiary age.
  • Both wells were drilled within budget, with MWD logging tool and conventional wireline, and the reservoirs were considered to be high-quality sands with good permeability.
  • Fluid samples were taken in both of the wells and were sent for analysis by the Operator. Results of that testing confirm that the samples recovered to date from Jethro-1 and Joe-are mobile heavy crudes with high sulphur content.
  • Oil tested to date appears not dissimilar to the commercial heavy crudes currently in production in the North Sea, Gulf of Mexico, the Campos Basin in Brazil, Venezuela and Angola.
  • The Company has engaged a third-party consultant with heavy oil development and economics expertise to help conduct preliminary evaluations related to production schemes and commercialisation. Technical and commercial evaluation work is ongoing and the Company is considering alternatives for further drilling and testing and a number of development scenarios and production alternatives. The Company remains optimistic in considering the development scenarios and, as the project progresses, will provide further information on plans and timing.
  • On 3 February 2020, the Company announced the filing of a National Instrument 51-101 compliant resource report on the Orinduik Block, offshore Guyana, which included:
    • Significant increase in Gross Prospective Resources to 5,141 MMBOE (771 MMBOE net to Eco) from previous estimate of Gross Prospective Resources of 3,981 MMBOE in March 2019.
    • 22 prospects identified on Orinduik Block including 11 leads in the Upper Cretaceous horizon.
    • Majority of the project leads have over a 30% or better chance of success (COS), enhanced by the recent discovery of light oil in the Carapa 1 well on the Kanuku block to the south of Orinduik.
    • Leads in the Tertiary aged section estimated to contain 1,204 MMBOE.
    • Leads in the Cretaceous section are estimated to contain approximately 3,936 MMBOE.



  • The Block operator has proposed a further fine tuning analysis of the upper cretaceous reservoirs, and the Operator has announced a plan to incorporate the Carapa well data into Orinduik's existing geological models and technical analysis over the coming period. Further, the partners plan to integrate the discoveries at Jethro and Joe with the Carapa discovery with the rest of the regional data now available and to incorporate this data into a reprocessing of the 3D seismic already shot on Orinduik. The intent is to provide further definition to the Cretaceous interpretation and target selection for drilling.
  • Geological modeling, prospects maturation and target selection on the Block are ongoing, and the JV Partners are working closely to agree the best work program to further explore the prospectivity of the license.
  • Multiple prospects are currently being reviewed with high-graded candidates under consideration for the next drilling programme.
  • Eco is fully funded and is pushing to drill a minimum of at least one upper Cretaceous target as soon as practically possible for its partners. Consideration is being given to prioritise a stacked multi-target well.

The Orinduik JV partners are Eco Atlantic (15% working interest ("WI")), Tullow Guyana B.V. ("Tullow") (Operator, 60% WI) and Total E&P Guyana B.V. ("Total") (25% WI).


  • Eco continues to progress its various work programmes offshore Namibia.
  • Eco sees an increasing interest in Namibia by major companies and large IOCs. The Company plans to monitor near-term drilling activity in the region and will update the market on developments as appropriate.

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

"After completing a successful drilling campaign in 2019, we continue to benefit from a very strong balance sheet and remain fully funded to conduct further exploration and appraisal drilling activity on the Orinduik Block. Our recently updated CPR reaffirms the high prospectivity of the license and the considerable upside potential contained within the Tertiary and Cretaceous horizons. As such, the JV Partners are working on incorporating the learnings gained from other regional discoveries, such as the Carapa well result, into our existing geological models, as this will enable us to identify the most high value targets on the Block.

"While it is Eco's intention, and there remains the potential, to conduct a drilling program later this year, the need to integrate the new data learned from recent discoveries in the region into our understanding of the Block's geology may result in further drilling and appraisal activity taking place in H1 2021. However, a final decision on further drilling activity and the overall budget will be made in the coming months. It is important to note that we remain convinced of the significant upside of Orinduik, are well funded, have strong shareholders and partners, and are confident that further drilling activity will be conducted as soon as practically possible and will prove the Block's potential."

The Company's unaudited financial results for three and six months ended 30 September 2019, together with Management's Discussion and Analysis as at 31 December 2019, 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 Canadian Dollars, unless otherwise stated.

Balance Sheet

  December 31,     March 31,  
  2019     2019  
  Unaudited     Audited  
Current assets
Cash and cash equivalents
    25,365,280       25,007,479  
Short-term investments
    74,818       74,818  
Government receivable
    50,102       33,104  
Accounts receivable and prepaid expenses
    65,632       80,926  
    25,555,832       25,196,327  
Petroleum and natural gas licenses
    1,489,971       1,489,971  
Total Assets
    27,045,803       26,686,298  
Current liabilities
Accounts payable and accrued liabilities
    194,782       423,513  
Advances from and amounts owing to license partners, net
    134,187       1,127,675  
Total Liabilities
    328,969       1,551,188  
Share capital
    78,853,808       50,025,998  
Restricted Share Units reserve
    356,493       111,493  
    70,280       52,775  
Stock options
    3,319,117       3,184,658  
Accumulated deficit
    (55,882,864)       (28,239,814 )
Total Equity
    26,716,834       25,135,110  
Total Liabilities and Equity
    27,045,803       26,686,298  

Income Statement

  Three months ended     Nine months ended  
  December 31,     December 31,  
  2019     2018     2019     2018  
  Unaudited     Unaudited  
Income from farm-out agreement
  -     16,759,307     -     16,759,307  
Interest income
  105,802       47,877     410,012       144,852  
    105,802       16,807,184       410,012       16,904,159  
Operating expenses:
Compensation costs
    265,096       247,330       832,747       771,953  
Professional fees
    138,017       72,295       469,390       172,591  
Operating costs (Notes 14)
    1,456,929       1,891,595       16,531,606       3,656,989  
General and administrative costs (Note 15)
    500,998       337,005       1,510,568       968,458  
Share-based compensation (Notes 9(i))
    59,504       1,487       7,527,865       4,460  
Foreign exchange loss (gain)
    939,036       (96,049 )     1,180,886       (4,897 )
Total expenses
    3,359,580       2,453,663       28,053,062       5,569,554  
Net profit (loss) and comprehensive loss
    (3,253,778)       14,353,521       (27,643,050)       11,334,605  
Basic and diluted net profit (loss) per share attributable to equity holders of the parent
    (0.02)       0.09       (0.15)       0.07  
Weighted average number of ordinary shares used in computing basic and diluted net loss per share
    184,441,830       159,785,217       182,225,982       158,998,512  

Cash Flow Statement

Nine months ended  
December 31,  
2019   2018  
Cash flow from operating activities
Net profit (loss) from operations
   (27,643,050)      11,333,119  
Items not affecting cash:
Share-based compensation
  7,527,865     5,946  
Warrants issued for services
  70,280     -  
Changes in non???cash working capital:
Government receivable
  (16,998)     3,904  
Accounts payable and accrued liabilities
  (228,731)     46,053  
Accounts receivable and prepaid expenses
  15,294     48,330  
Advance from and amounts owing to license partners
  (993,488)     (8,043 )
  (21,268,828)     11,429,309  
Cash flow from financing activities
Net proceeds from private placement
  21,338,853     -  
Proceeds from the exercise of stock options
  126,000     -  
Proceeds from the exercise of warrants
  161,776     -  
  21,626,629     -  
Increase (decrease) in cash and cash equivalents
  357,801     11,429,309  
Cash and cash equivalents, beginning of year
  25,007,479     14,316,042  
Cash and cash equivalents, end of period
  25,365,280     25,745,351  

Basis of Preparation

The condensed consolidated interim 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.

Subsequent Events

On 9 January 2020, a director of the Company elected to exercise 350,000 options at an exercise price of $0.30. In order to effect a cashless exercise, as permitted under the Company's Stock Option Plan, and minimize dilution to shareholders, the Board agreed to issue 250,000 common shares in lieu of the 350,000 options intended to be exercised.

The Company also granted to the Company's IR and Marketing manager, options to subscribe for up to 200,000 Common Shares at a price of $1.20 per Share (the "Options"). The Options vest equally over three years with the first vesting period occurring on the date of issue and expire 5 years from the date of issue.


For more information, please visit or contact the following:

Eco Atlantic Oil and Gas

+1 (416) 250 1955

Gil Holzman, CEO

Colin Kinley, COO

Alice Carroll, Head of Marketing and IR

+44(0)781 729 5070

Strand Hanson Limited (Financial & Nominated Adviser)

+44 (0) 20 7409 3494

James Harris

Rory Murphy

James Bellman


Stifel Nicolaus Europe Limited (Joint Broker)

Callum Stewart

Ashton Clanfield

+44 (0)20 7710 7600

Berenberg (Joint Broker)

+44 (0) 20 3207 7800

Matthew Armitt

Detlir Elezi


Celicourt (PR)

+44 (0) 20 8434 2754

Mark Antelme

Jimmy Lea

Hannam & Partners (Research Advisor)

Neil Passmore

Hamish Clegg

Canaccord Genuity (North American Advisor)

Simon Akit

+44 (0) 20 7905 8500

+1 416 869 3820

The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014.

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, including Tullow, Total and Azinam.

In Guyana, Eco Guyana holds a 15% working interest alongside Total (25%) and 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 and Hess Corporation's Stabroek Block, on which sixteen discoveries have been announced and over 8 Billion BOE of oil equivalent recoverable resources are estimated. First oil production commenced in December 2019 from the deep-water Liza Field, less than 3 years from FID.

Jethro-1 was the first major oil discovery on Orinduik Block. The Jethro-1 encountered 180.5 feet (55 meters) of net high-quality oil pay in excellent Lower Tertiary sandstone reservoirs which further proves recoverable oil resources. Joe-1 is the second discovery on the Orinduik Block and comprises 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 which further proves the presence of recoverable oil resources.

In Namibia, the Company holds interests in four offshore petroleum licenses totalling approximately 25,000km2 with over 2.3bboe of prospective P50 resources in the Walvis and Lüderitz Basins. These four licenses, Cooper, Guy, Sharon and Tamar are being developed alongside partners Azinam and NAMCOR. Eco has been granted a drilling permit on its Cooper Block (Operator).

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact [email protected] or visit

SOURCE: Eco (Atlantic) Oil and Gas Ltd.

Eco (Atlantic) Oil and Gas Ltd.
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