Operations:
South Africa
Block 2B (post period end)
-
In early October 2022, the Island Innovator Semi-Submersible Drilling Rig arrived on Block 2B, offshore South Africa, and operations on the Gazania-1 Exploration Well commenced.
-
The well was spudded on October 10, 2022, and reached target depth of 2,360m. However, evidence of commercial hydrocarbons was not found, and the well has been plugged and abandoned.
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The JV Partners submitted a Production Right Application to the Petroleum Agency of South Africa ("PASA") on November 15, 2022, for Block 2B, based on the existing oil discovery of AJ-1 and potential future operations. Well logging has been completed and the JV Partners now have time to conduct further analysis and integrate the well data to allow them to determine the next steps on the Block.
Block 3B/4B
-
The Company and its JV partners are progressing plans to conduct a two-well campaign on Block 3B/4B offshore South Africa.
-
As previously announced by the Operator of Block 3B/4B, a collaborative farm-out process (up to 55% gross WI), has been ongoing, and is now in a farm-out agreement negotiation stage. The JV partners will update the market as appropriate and should a farm-out agreement be concluded.
Namibia
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Following recent significant hydrocarbon discoveries offshore Namibia, Eco continues to assess options for progressing exploration and commercial activity on its acreage.
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Eco is witnessing considerable interest in its licences in Namibia and is currently assessing options, including a potential farm-out.
Guyana
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As previously announced, Eco and its JV partners on the Orinduik Block, offshore Guyana, are currently drawing up plans to drill at least one well into light oil Cretaceous targets in the next Petroleum Agreement exploration phase which begins in 2023. Further updates will be made on this matter in due course.
Gil Holzman, President and Chief Executive Officer of Eco Atlantic, commented:
"Our main focus during the period, and through to recent weeks, was to execute a safe and environmentally friendly drilling campaign on the Gazania-1 exploration well, offshore South Africa. Although it was disappointing to not announce a commercial discovery, we can be proud of how we conducted our operations, which led to the well being drilled safely and on-time. We are now working with our JV partners on the licence to analyse the well data found and plan our next steps on the Block, which we believe contains significant untapped potential.
On Block 3B/4B, offshore South Africa, we are making steady progress towards conducting a two well drilling campaign on the licence. The drilling preparations and program are expected to commence in 2023 and, as previously announced, a potential farm-out process is also underway on the licence. We look forward to updating the market on both of these workstreams as appropriate.
In Guyana, we remain highly optimistic about the potential contained within the Orinduik Block, and we are working with our JV partners to drill another well as quickly as possible. Guyana remains one of the most exciting exploration hotspots, alongside Orange Basin SA and Namibia, where we also hold a highly strategic acreage position, and we are working hard to deliver value for all our stakeholders across our asset portfolio in the near to medium term.
Finally, on behalf of the Board I would like to thank Moshe Peterburg for his tireless efforts during his tenure as Eco's Chairman for the past 12 years and since inception of the Company. He played a pivotal role in the development and success of the Company to date and we wish him all the best for a happy retirement and are pleased he will remain an important shareholder of Eco."
The Company's unaudited financial results for the three months ended 30 September 2022, together with Management's Discussion and Analysis as at 30 September 2022, are available to download on the Company's website at www.ecooilandgas.com and on Sedar at www.sedar.com.
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
| | September 30, | | March 31, |
| 2022 | 2022 |
| | (Unaudited) | | (Audited) |
| Assets | | | |
| Current Assets | | | |
| Cash and cash equivalents | 24,590,082 | | 3,438,834 |
| Short-term investments | 52,618 | | 52,618 |
| Government receivable | 32,656 | | 27,487 |
| Amounts owing by license partners, net | 13,764 | | - |
| Accounts receivable and prepaid expenses | 2,206,208 | | 257,911 |
| Assets held for sale | 2,052,326 | | 2,061,734 |
| Total Current Assets | 28,947,654 | | 5,838,584 |
| | | | |
| Non- Current Assets | | | |
| Investment in associate | 9,092,557 | | 9,277,162 |
| Petroleum and natural gas licenses | 29,253,034 | | 30,753,034 |
| Total Non-Current Assets | 38,345,591 | | 40,030,196 |
| Total Assets | 67,293,245 | | 45,868,780 |
| | | | |
| Liabilities | | | |
| Current Liabilities |
| Accounts payable and accrued liabilities | 3,361,588 | | 1,931,823 |
| Advances from and amounts owing to license partners, net | 67,406 | | - |
| Current liabilities related to assets held for sale | 882,959 | | 473,254 |
| Warrant liability | 1,395,066 | | 3,241,762 |
| Total Current Liabilities | 5,707,019 | | 5,646,839 |
| | | | |
| Total Liabilities | 5,707,019 | | 5,646,839 |
| | | | |
| Equity | | | |
| Share capital | 113,930,574 | | 63,141,609 |
| Shares to be issued | - | | 20,766,996 |
| Restricted Share Units reserve | 569,919 | | 267,669 |
| Warrants | 14,778,272 | | 7,806,000 |
| Stock options | 2,075,897 | | 958,056 |
| Foreign currency translation reserve | (1,862,829) | | (1,309,727) |
| Accumulated deficit | (67,905,607) | | (51,408,662) |
| | | | |
| Total Equity | 61,586,226 | | 40,221,941 |
| | | | |
| Total Liabilities and Equity | 67,293,245 | | 45,868,780 |
Income Statement
| | Three months ended | | Six months ended |
| September 30, | September 30, |
| | 2022 | | 2021 | | 2022 | | 2021 |
| | Unaudited | | Unaudited |
| Revenue | | | | | | | |
| Interest income | 36,325 | | 3,911 | | 56,452 | | 8,435 |
| | 36,325 | | 3,911 | | 56,452 | | 8,435 |
| Operating expenses: | | | | | | | |
| Compensation costs | 210,605 | | 206,327 | | 479,914 | | 410,087 |
| Professional fees | 240,894 | | 142,540 | | 460,579 | | 181,499 |
| Operating costs | 11,097,960 | | 34,953 | | 13,041,411 | | 417,818 |
| General and administrative costs | 350,864 | | 200,960 | | 608,154 | | 309,357 |
| Share-based compensation | 750,667 | | 5,888 | | 1,751,886 | | 11,710 |
| Foreign exchange loss | 690,794 | | 99,153 | | 975,221 | | 53,222 |
| Total operating expenses | 13,341,784 | | 689,821 | | 17,317,165 | | 1,383,693 |
| | | | | | | | |
| Operating loss | (13,305,459) | | (685,910) | | (17,260,713) | | (1,375,258) |
| | | | | | | | |
| Fair value change in warrant liability | 415,712 | | 637,189 | | 1,846,696 | | 637,189 |
| Share of losses of company accounted for at equity | (92,302) | | - | | (184,605) | | - |
| Net loss for the period from continuing operations | (12,982,049) | | (48,721) | | (15,598,622) | | (738,069) |
| Loss from discontinued operations, after-tax | (800,210) | | (351,915) | | (898,323) | | (488,191) |
| Net loss for the period | (13,782,259) | | (400,636) | | (16,496,945) | | (1,226,260) |
| | | | | | | | |
| Foreign currency translation adjustment | (441,472) | | (21,484) | | (553,102) | | (8,235) |
| Comprehensive loss for the period | (14,223,731) | | (422,120) | | (17,050,047) | | (1,234,495) |
| | | | | | | | |
| Net loss for the period attributed to: | | | | | | | |
| Equity holders of the parent | (12,982,049) | | (421,643) | | (16,496,945) | | (1,226,260) |
| Non-controlling interests | - | | 21,007 | | - | | - |
| | (12,982,049) | | (400,636) | | (16,496,945) | | (1,226,260) |
| | | | | | | | |
| Basic and diluted net loss per share attributable to equity holders of the parent | (0.038) | | (0.002) | | (0.052) | | (0.006) |
| Weighted average number of ordinary shares used in computing basic and diluted net loss per share | 343,966,022 | | 198,403,885 | | 319,575,745 | | 191,550,804 |
Cash Flow Statement
| | Six months ended |
| | September 30, |
| 2022 | | 2021 |
| | (Unaudited) | | (Unaudited) |
| Cash flow from operating activities | | | |
| Net loss from continuing operations | (15,598,622) | | (738,069) |
| Net loss from discontinued operations | (898,323) | | (488,191) |
| Items not affecting cash: | | | |
| Share-based compensation | 1,751,886 | | 11,710 |
| Depreciation and amortization | - | | 38,124 |
| Accrued interest | - | | 6,770 |
| Revaluation of warrant liability | (1,846,696) | | (637,189) |
| Share of losses of companies accounted for at equity | 184,605 | | - |
| Changes in non‑cash working capital: | | | |
| Government receivable | (5,169) | | 8,752 |
| Accounts payable and accrued liabilities | 1,601,059 | | 102,372 |
| Accounts receivable and prepaid expenses | (948,297) | | (7,730) |
| Reallocation to discontinued operations cashflows | (171,294) | | - |
| Net change in non-cash working capital items relating to discontinued operations | 419,113 | | - |
| Advance from and amounts owing to license partners | 1,486,236 | | (247,066) |
| | (14,025,502) | | (1,950,517) |
| | | | |
| Cash flow from investing activities | | | |
| Investment in associate | - | | (10,000,000) |
| Short-term investments | - | | 1,500,022 |
| | - | | (8,499,978) |
| | | | |
| Cash flow from financing activities | | | |
| Proceeds from private placements, net | 35,662,446 | | - |
| Issuance of shares | - | | 4,793,789 |
| Exercise of stock options | 67,406 | | 71,388 |
| | 35,729,852 | | 4,865,177 |
| | | | |
| Increase (decrease) in cash and cash equivalents | 21,704,350 | | (5,585,318) |
| Foreign exchange differences | (553,102) | | (671) |
| Cash and cash equivalents, beginning of period | 3,438,834 | | 11,807,309 |
| | | | |
| Cash and cash equivalents, end of period | 24,590,082 | | 6,221,320 |
Notes to the Financial Statements
Basis of Preparation
The Condensed Interim 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.
**ENDS**
For more information, please visit www.ecooilandgas.com 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 Corporate Sustainability | +44(0)781 729 5070 |
| Strand Hanson (Financial & Nominated Adviser)
| +44 (0) 20 7409 3494 |
| James Harris
James Bellman | |
| Berenberg (Broker) | +44 (0) 20 3207 7800 |
| Matthew Armitt
Detlir Elezi | |
| Echelon Capital (Financial Adviser N. America Markets) | |
| Ryan Mooney
Simon Akit | +1 (403) 606 4852
+1 (416) 8497776 |
| Celicourt (PR) | +44 (0) 20 8434 2754 |
| Mark Antelme
Jimmy Lea | |
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 (as amended).
Notes to editors:
About Eco Atlantic:
Eco Atlantic is a TSX-V and AIM-quoted Atlantic Margin-focused oil & gas exploration company with offshore license interests in Guyana, Namibia, and South Africa. Eco aims to deliver material value for its stakeholders through its role in the energy transition to explore for low carbon intensity oil and gas in stable emerging markets close to infrastructure.
Offshore Guyana in the proven Guyana-Suriname Basin, the Company holds a 15% Working Interest in the 1,800 km2 Orinduik Block Operated by Tullow Oil. In Namibia, the Company holds Operatorship and an 85% Working Interest in four offshore Petroleum Licences: PELs: 97, 98, 99, and 100, representing a combined area of 28,593 km2 in the Walvis Basin.
Offshore South Africa, Eco is Operator and holds a 50% working interest in Block 2B and a 20% Working Interest (to be increased to a 26.25% Working Interest, subject to Completion of the Acquisition announced 27 June 2022) in Block 3B/4B operated by Africa Oil Corp., totalling some 20,643 km2.
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 rns@lseg.com or visit www.rns.com.
SOURCE: Eco (Atlantic) Oil and Gas Ltd.
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https://www.accesswire.com/729171/Eco-Atlantic-Oil-and-Gas-Ltd-Announces-Results-for-the-Six-Months-Ended-30-September-2022
