REG - Eco (Atlantic) O&G - Results for Three-Month Period Ended 30 June 2024
30/08/2024 07:00
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RNS Number : 3015C Eco (Atlantic) Oil and Gas Ltd. 30 August 2024
30 August 2024
ECO (ATLANTIC) OIL & GAS LTD.
("Eco," "Eco Atlantic," "Company," or together with its subsidiaries, the
"Group")
Results for the Three-Month Period Ended 30 June 2024
Eco (Atlantic) Oil & Gas Ltd. (AIM: ECO, TSX ‐ V: EOG), the oil and
gas exploration company focused on the offshore Atlantic Margins, is pleased
to announce its unaudited results for the three-month period ended 30 June
2024.
Highlights:
Financials
· The Company had cash and cash equivalents of US$1.185 million and no
debt as at 30 June 2024.
· The Company had total assets of US$29.65 million, total liabilities
of US$0.791 million and total equity of US$28.859 million as at 30 June 2024.
Post-period end
· Following the completion of a farm down of a 13.75% Participating
Interest in Block 3B/4B offshore the Republic of South Africa, as announced
on 28 August 2024, Eco is due to receive US$8.3million in total as part of the
3B/4B Transaction. This is expected to give Eco a cash and cash equivalents
position of over US$9 million on receipt, expected during early September
2024.
Operations:
South Africa
Block 1 (post-period end)
· On June 5, 2024, Eco announced the Farm-In into Block 1 Offshore
South Africa Orange Basin. Through Azinam South Africa, the Company will
farm-in and acquire a 75% working interest ("WI") from Tosaco Energy
(Proprietary) Limited ("Tosaco") and will become operator of a new exploration
right.
Block 3B/4B
· In July 2024, Eco signed an agreement to sell a 1% interest in Block
3B/4B in exchange for cancellation of all of Africa Oil's ("AOI") shares and
warrants in Eco (worth approximately C$ 11.5m at the time of agreement). Upon
Completion of the transaction, Eco will hold a fully carried 5.25% interest in
Block 3B/4B Offshore South Africa, reducing from the current 6.25%. Closing is
expected to occur in Q4 2024.
Post-period end
· On August 28, 2024, the Company announced the completion of a farm
down of a 13.75% Participating Interest in Block 3B/4B offshore the Republic
of South Africa and Transfer of Operatorship of the Block after receipt of the
requisite regulatory approvals (Section 11) from the government of South
Africa. Eco now holds a 6.25% interest in Block 3B/4B.
· Further to the Company's announcement on 6 March 2024 detailing the
Farmout Agreement ("FOA"), Azinam Limited, Eco's wholly owned subsidiary, has
farmed down a 13.75% Participating Interest in Block 3B/4B, offshore the
Republic of South Africa as part of an aggregate 57% farm down transaction
along with its Joint Venture Partners Africa Oil SA Corp. and Ricocure
(Proprietary) Limited to TotalEnergies EP South Africa S.A.S., who will become
Operator and QatarEnergy International E&P LLC.
· Following Completion, Eco is now due to receive US$8.3million in
total as part of the 3B/4B Transaction, including Completion linked milestone
payments of US$4m from Africa Oil and US$1.56m from Ricocure, as referred to
in the Company's announcement of 6 March 2024. Further payments, amounting to
$11.5m will be payable to Eco from TotalEnergies, QatarEnergy and Africa Oil
on spudding of the first exploration well.
Block 2B
· In June 2024, the Company relinquished its 50% WI Operated offshore
Block 2B where it drilled its 2022 Gazania-1 well offsetting the AJ-1 oil
discovery. The Company has completed all necessary documentation, and
environmental audits, and has informed the Petroleum Agency of South Africa
("PASA"), the regulator for the Government of South Africa.
Namibia
· A multi-block farm out process remains underway for all or part of
Eco's four offshore Petroleum Exploration Licences ("PEL"): 97, 98, 99, and
100. Eco holds Operatorship and an 85% Working Interest in each PEL
representing a combined area of 28,593 km(2) in the Walvis Basin.
· Eco added ~1,383km 2D data licensed on PEL100 (Tamar block) to its
database, which is being technically evaluated and interpreted by the team to
define additional seismic acquisition areas within the Block, along with new
leads and prospects.
Guyana
· An active farmout process continues for the offshore Orinduik Block.
Eco is encouraged to see the growing activity surrounding its acreage, notably
ExxonMobil's plans for a seventh development at Hammerhead in the Stabroek
Block.
Gil Holzman, President and Chief Executive Officer of Eco Atlantic,
commented:
"We continued to make significant progress across our asset base during the
period. On Block 3B/4B, we announced the completion of Eco's farm-out
agreement with TotalEnergies and QatarEnergy, which will see Eco receive
US$8.3 million while still maintaining a material interest in the Block.
"We also announced Eco's transaction with AOI, where the Company sold a 1%
interest in Block 3B/4B in exchange for cancellation of all of Africa Oil's
shares and warrants in Eco worth C$ 11.5m. Eco continues to possess
significant upside potential and exposure to assets offshore South Africa and
in the Orange Basin, two highly exciting regions for hydrocarbon
prospectivity.
"Our active farm-out processes in both Namibia and Guyana have seen Eco
actively engaged with a number of potential high-calibre partners as we work
to monetise these licences as fast as is practically possible for the benefit
of all involved. We look forward to providing updates on material developments
to all our stakeholders over the coming months."
The Company's unaudited financial results and Management's Discussion and
Analysis for the three months ended 30 June 2024 are available for 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
June 30, March 31,
2024 2024
Assets
Current Assets
Cash and cash equivalents 1,185,116 2,967,005
Short-term investments 13,107 13,107
Government receivable 16,772 26,970
Amounts owing by license partners 115,319 49,578
Accounts receivable and prepaid expenses 2,006 38,539
Total Current Assets 1,332,320 3,095,199
Non- Current Assets
Petroleum and natural gas licenses 28,318,439 28,168,439
Total Non-Current Assets 28,318,439 28,168,439
Total Assets 29,650,759 31,263,638
Liabilities
Current Liabilities
Accounts payable and accrued liabilities 791,417 1,163,546
Advances from and amounts owing to license partners - 81,952
Total Current Liabilities 791,417 1,245,498
Total Liabilities 791,417 1,245,498
Equity
Share capital 122,088,498 122,088,498
Restricted Share Units reserve 920,653 920,653
Warrants 14,778,272 14,778,272
Stock options 2,900,501 2,900,501
Foreign currency translation reserve (1,600,208) (1,568,469)
Accumulated deficit (110,228,374) (109,101,315)
Total Equity 28,859,342 30,018,140
Total Liabilities and Equity 29,650,759 31,263,638
Income Statement
Three months ended
June 30,
2024 2023
Revenue
Interest income 3,211 1,665
3,211 1,665
Operating expenses:
Compensation costs 199,467 184,442
Professional fees 141,969 96,003
Operating costs, net 541,686 350,180
General and administrative costs 158,025 112,473
Share-based compensation - 111,512
Foreign exchange loss (gain) 89,123 (40,050)
Total operating expenses 1,130,270 814,560
Operating loss (1,127,059) (812,895)
Other Non-Operating Charges and Write-downs
Fair value change in warrant liability - 261,720
Share of losses of associate - (166,224)
Net loss for the period (1,127,059) (717,399)
Foreign currency translation adjustment (31,739) (295,676)
Comprehensive loss for the period (1,158,798) (1,013,075)
Basic and diluted net loss per share: (0.003) (0.002)
Weighted average number of ordinary shares used in computing basic and diluted 370,173,680 367,348,680
net loss per share
Cash Flow Statement
Three months ended
June 30,
2024 2023
Cash flow from operating activities
Net loss from continuing operations (1,127,059) (717,399)
Items not affecting cash:
Share-based compensation - 111,512
Fair value change in warrant liability - (261,720)
Share of losses of companies accounted for at equity - 166,224
Changes in non‑cash working capital:
Government receivable 10,198 (3,477)
Accounts payable and accrued liabilities (372,129) (1,045,330)
Accounts receivable and prepaid expenses 36,533 (1,283)
Advance from and amounts owing to license partners (147,693) 382,277
Cash flow from operating activities (1,600,150) (1,369,196)
Cash flow from investing activities
Acquisition of interest in property (150,000) -
Cash flow from investing activities (150,000) -
Cash flow from financing activities - -
Decrease in cash and cash equivalents (1,750,150) (1,369,196)
Foreign exchange differences (31,739) (295,676)
Cash and cash equivalents, beginning of period 2,967,005 4,110,734
Cash and cash equivalents, end of period 1,185,116 2,445,862
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.
**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, Executive Director
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
Celicourt (PR) +44 (0) 20 7770 6424
Mark Antelme
Jimmy Lea
About Eco Atlantic:
Eco Atlantic is a TSX-V and AIM-quoted Atlantic Margin-focused oil and 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 operates a
100% Working Interest in the 1,354 km(2) Orinduik Block. 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 km(2) in the Walvis Basin. Offshore South Africa, Eco holds a 6.25%
Working Interest in Block 3B/4B and pending government approval a 75% Operated
Interest in Block 1, in the Orange Basin, totalling some 37,510km(2).
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