REG - Eco (Atlantic) O&G - Acquisition of JHI & Navitas Partnership

Eco (Atlantic) Oil & GasAnnouncement

11/03/2026 07:00

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RNS Number : 2034W  Eco (Atlantic) Oil and Gas Ltd.  11 March 2026

11 March 2026

 

ECO (ATLANTIC) OIL & GAS LTD.

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

 

Acquisition of 100% of JHI

Partnership with Navitas in North Falklands Licence

 

Eco (Atlantic) Oil & Gas Ltd. (AIM: ECO, TSX ‐ V: EOG) (Toronto,
Canada), the oil and gas exploration company focused on the offshore Atlantic
Margins, is pleased to announce that it signed a binding agreement on 10
March 2026 with JHI Associates, Inc. ("JHI") in which Eco has agreed to
acquire the issued and to be issued shares of JHI not already held by Eco (the
"Transaction" or the "Acquisition"). The Acquisition is subject to a number of
conditions, further details of which are set out below.

 

This landmark acquisition complements Eco's existing Atlantic Margin portfolio
in Namibia and South Africa, whilst adding to its exposure offshore Guyana.
The Acquisition positions Eco at the forefront of one of the most compelling
offshore growth stories globally, the North Falkland Basin, alongside intended
operator and strategic partner Navitas Petroleum LP ("Navitas").

 

Eco has agreed to acquire all remaining JHI common shares ("JHI Shares") based
on an exchange ratio of 0.7054 common shares in the capital of the Company
("Common Shares") for each JHI share (the "Exchange Ratio") (the "Arrangement
Agreement").

 

Transaction Highlights:

 

·    Strategic alignment with Navitas, with the first asset confirmed in
joint venture partnership.

·    New country entry into Falkland Islands, with near term exploration
work program planned on the PL001 licence with operator Navitas, once
confirmed by the Falkland Island Government ("FIG").

·    Anticipated five-year licence extension of the PL001 licence,
providing significant runway for exploration and development.

·    Imminent adjacent development coming onstream, with first oil from
the Sea Lion Field expected in 2028.

·    Agreed cash balance in JHI of a minimum of US$1.0 million on closing.

·    Provides Eco Shareholders with exposure to high impact near term
exploration and development acreage in an additional emerging Atlantic Margin
hydrocarbon province, and subject to a potential extension of the Canje
licence, furthers its exposure in Guyana.

 

Transaction Summary:

 

On completion of the Acquisition ("Closing"), Eco will issue up to 96,307,811
new Common Shares such that up to approximately 21.8% of Eco's then issued
share capital will be held by the shareholders of JHI.  Upon Closing, JHI
will have a cash balance of US$1.0 million. Approximately 45% of the Common
Shares to be issued to JHI shareholders will be subject to lock-up
arrangements spanning 18 months following completion. The Acquisition is
valued at approximately US$52.3 million (approximately £39.0 million) based
on the 30-day volume weighted average price ("VWAP") of the Company's Common
Shares on the TSX Venture Exchange ("TSX-V") ending on 9 March 2026 of
CAD$0.7362. The Acquisition is valued at approximately £46.7 million
(approximately US$62.6 million) based on the mid market closing price of the
Company's Common Shares on the AIM market of the London Stock Exchange of
£0.485 on 10 March 2026.

 

JHI's principal assets comprise a 35% working interest in the PL001 licence
area in the Falkland Islands, a block directly adjacent to the
transformational Sea Lion Field under development, and a 17.5% working
interest in the Canje Block offshore Guyana (operated by ExxonMobil and JV
partner TotalEnergies and Mid Atlantic O&G).  The Canje licence lapsed on
4 March 2026 and is subject to on-going extension discussions with the
Government of Guyana ("Canje Extension").  The remaining 65% interest in the
PL001 licence area will be held by Navitas, assuming approval of their farm in
to PL001, as announced on 2 March 2026, by FIG.

 

On completion, the Transaction provides Eco shareholders with exposure to
high-impact near term exploration and development acreage in an additional
Atlantic Margin emerging hydrocarbon province, and assuming the Canje
Extension, further its exposure in Guyana.

 

The Sea Lion development, to be operated by Navitas, represents the first
major offshore oil development in the North Falkland basin and achieved Final
Investment Decision ("FID") in December 2025, with first oil targeted for
2028. The planned development infrastructure in relation to the Sea Lion
development is expected to unlock the broader basin potential, and Eco's
strategic alignment with Navitas places the Company at the heart of the next
wave of growth in the region.

 

The PL001 licence Joint Venture partners (Navitas, assuming FIG approval, and
JHI) are working together with the FIG to extend the licence, which currently
expires on 31 December 2026, for 5-years, in preparation to drill an
exploration well. The Acquisition is conditional, inter alia, on the granting
of the licence extension by FIG.

 

On 2 March 2026, Navitas announced that it had agreed with JHI to farm-in for
a 65% interest in PL001, pursuant to which JHI received a fully funded carry
loan for an exploration well and potential appraisal well up to US$14 million
net to JHI, the benefit of which Eco will assume through the Transaction. The
loan will be repaid from 85% of JHI's free cash flow from production from the
PL001 licence, if production is established. This carry meaningfully reduces
capital exposure while retaining material upside to drilling/exploration
catalysts planned across the licence. Eco does not currently expect that it
will be required to contribute further towards the expected exploration work
program, including tests of the well.

 

PL001 sits in the North Falklands Basin, adjacent to the Navitas-operated Sea
Lion Development and covers 1,126 km(2) in water depths ranging from
400-500m. The block holds significant oil exploration potential, which Eco
believes will now be unlocked with the emergence of the basin as a producing
petroleum province. PL001 contains two legacy wells with oil shows, and part
of the Rockhopper Exploration plc led Johnson gas discovery, and is fully
covered by a 3D seismic survey, on which over 50 leads and prospects have been
identified at multiple play levels, underpinned by a proven Lower Cretaceous
petroleum system with world-class source rocks. The latest CPR, commissioned
prior to JHI's acquisition of the PL001 licence, estimated an aggregate 3.1bn
bbls of prospective (best estimate) recoverable resources (unrisked). PL001
licence contains a proven Cretaceous petroleum system adjacent to Sea Lion
discovery and several material, analogous prospects have been high-graded with
the potential to target multiple objectives with a single exploration well,
and significant follow-up prospectivity across the wider block.

 

The immediate proximity to the Sea Lion planned producing platform materially
enhances the commercial attractiveness of PL001, offering potential future
tie-back and infrastructure synergies, accelerating potential monetisation
pathways and reducing development risk.

 

The Canje Block offshore Guyana, operated by ExxonMobil with JV partners
TotalEnergies and Mid Atlantic O&G, is directly north of the Stabroek
trend, within the same petroleum system as other ExxonMobil discoveries. The
block hosts multiple prospects identified through modern 3D seismic data,
supported by high-quality AVO (Amplitude Versus Offset) and/or DHI (Direct
Hydrocarbon Indicator) indicators, highlighting a large inventory of prospects
with significant potential.

 

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

 

"This Transaction represents a further transformational milestone in Eco's
strategic evolution and reinforces our disciplined approach to assembling
high-quality Atlantic Margin acreage alongside best-in-class operating
partners. By securing a significant working interest adjacent to the Sea Lion
Field, and further aligning ourselves with Navitas, a proven,
development-focused operator with a clear pathway to first oil, Eco is
advancing beyond pure exploration exposure and positioning itself within a
basin entering a new phase of development-led growth.

 

With Sea Lion progressing toward development and infrastructure build-out, and
with planned drilling activity supported by a meaningful carry, we believe Eco
is now exceptionally well positioned to participate in the next chapter of
growth in the region while maintaining capital discipline and maximising
shareholder value.

 

In parallel to this transaction, Eco and Navitas are continuing their advanced
discussions with the Government of Guyana regarding the appraisal and
exploration program on the Orinduik block, while progressing lead and prospect
evaluation on Block 1 CBK in South Africa's Orange basin, and maintaining an
active farm-out process on our three Walvis basin blocks in Namibia. We will
update the market in due course on any further development across our wider
Atlantic margin portfolio.

 

I want to thank my team and our advisors for their hard work; we are delighted
to update the market on the continued progress of the Company through our
proposed acquisition of JHI. Today's announcement builds on the strong
momentum we have generated since signing our framework agreement with Navitas
in December 2025 and further strengthens our strategic Atlantic margin
footprint in the North Falkland Basin."

 

Transaction Overview including conditions to Completion

 

Under the terms of the Arrangement Agreement, upon Closing, Eco Atlantic will
issue 96,307,811 Common Shares (the "Consideration Shares") to JHI's
shareholders, JHI warrant holders, and JHI option holders (together "JHI
Securityholders"). Following Closing, it is expected that JHI Securityholders
will hold approximately 21.8% of then Eco's issued share capital.

 

The consideration payable by Eco comprises the Consideration Shares only, and
no cash. The Consideration Shares have an aggregate value of approximately
US$52.3 million (approximately £39.0 million) based on the Exchange Ratio
which was fixed by reference to the 30-day VWAP of the Company's Common Shares
on the TSX-V ended on 9 March 2026 of CAD$0.7362. The Consideration Shares
have an aggregate value of approximately £46.7 million (approximately US$62.6
million) based on the mid market closing price of the Company's Common Shares
on the AIM market of the London Stock Exchange of £0.485 on 10 March 2026.
The Acquisition, once concluded, will result in Eco becoming the sole owner of
JHI's cash balance, which pursuant to the Transaction will amount to US$1.0
million, and its 35% working interest in the PL001 licence area in the
Falkland Islands and 17.5% participating interest in the Canje Block, pending
potential extension discussions with the Government of Guyana. Completion is
subject, among other conditions, to the approval of a five-year licence
extension on PL001, from FIG ("Falkland Licence Extension").

 

The gross asset value of JHI as at 31 December 2025, per the unaudited JHI
financial statements, was US$15.3 million, and the unaudited loss for the
financial year ended 31 December 2025 was US$2.8 million.

 

In addition to the Falkland Licence Extension, completion of the Acquisition,
which is expected during Q3 2026, is subject to several closing conditions,
including receipt of the requisite approvals from the TSX Venture Exchange,
and the approval of two thirds of the votes cast by JHI Shareholders at a
special meeting to be held to approve the Acquisition within the next four
weeks. The Transaction is not conditional on the Canje Extension. JHI shall be
entitled to designate one nominee to the board of directors of Eco (the "Eco
Board"), being Mr Daniel Guy, currently a director in JHI, such appointment
being subject to completion of customary due diligence by the Company's
Nominated Adviser and as required pursuant to the AIM Rules for Companies and
the TSX-V regulations. Mr Guy's appointment to the Eco Board is expected to be
made on Closing. On Closing it is expected that Mr. Frederick Cedoz will join
the Eco Atlantic team as Vice President, Americas with a specific focus on the
Falkland Islands and Guyana licences' management.

 

Fred brings nearly 30 years of global energy experience spanning project
financing, geopolitics, and upstream deal-making. He was co-founder and
president of JHI Associates, where he led major international transactions
including the Canje Block partnership offshore Guyana with ExxonMobil and
TotalEnergies, and the farm-out of the PL001 licence in the Falkland Islands
to Navitas. He holds a B.A. from University of Dayton and a law degree from
The Catholic University of America, and is admitted to practice law in the
District of Columbia.

 

In connection with entering into the Arrangement Agreement, all the directors
and officers of JHI and certain JHI Securityholders have entered into voting
support agreements (the "Support Agreements") in respect of the Acquisition
and lock-up agreements (the "Lock-Up Agreements"). Pursuant to the terms of
the Support Agreements, each signatory, who together hold approximately 38% of
JHI's voting rights (on a fully diluted basis), has agreed to not transfer any
JHI securities prior to Closing, and to vote in favour of the Acquisition at
the meeting of JHI Securityholders. Each signatory to the Lock-Up Agreements
has agreed to not transfer or sell the Consideration Shares received on
Closing (subject to limited exceptions), with such locked up shares to be
released in tranches, with 10% being released on Closing, a further 10% three
months following Closing, a further 10% six months following Closing, a
further 20% twelve months following closing and the remaining 50% on the the
earlier of September 30, 2027, and the date on which the first offshore well
in the Falkland Islands is spud by or on behalf of Eco.

 

PillarFour Capital Inc. acted as Eco's financial advisor on the Transaction.
PillarFour Capital Inc. will be entitled to US$150,000 in cash and 725,000
Common Shares upon Closing.

 

**ENDS**

 

For more information, please visit www.ecooilandgas.com or contact the
following.

 

 Eco Atlantic Oil and Gas                                         c/o Celicourt +44 (0) 20 7770 6424
 Gil Holzman, President & Chief Executive Officer

 Alice Carroll, VP Business Development & Corporate Affairs
 Strand Hanson (Financial & Nominated Adviser)                     +44 (0) 20 7409 3494
 James Harris, James Bellman
 Canaccord Genuity (Joint Broker)                                 +44 (0) 20 7523 8000
 Henry Fitzgerald-O'Connor, Charlie Hammond
 Berenberg (Joint Broker)                                         +44 (0) 20 3207 7800
 Matthew Armitt
 Celicourt (PR)                                                   +44 (0) 20 7770 6424
 Mark Antelme, Charles Denley-Myerson

 

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that
term is defined in the policies of the TSX Venture Exchange) accepts
responsibility for the adequacy or accuracy of this release.

 

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 by virtue of the Market
Abuse (Amendment) (EU Exit) Regulations 2019.

 

 

About Eco Atlantic:

 

Eco Atlantic is a TSX-V and AIM-quoted Atlantic Margin-focused oil and gas
exploration company with offshore licence 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.

 

In 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 three offshore
Petroleum Licences: PELs: 97, 99, and 100, representing a combined area of
22,893 km(2) in the Walvis Basin. In Offshore South Africa, Eco holds a 5.25%
Working Interest in Block 3B/4B and a 75% Operated Interest in Block 1 CBK, in
the Orange Basin, totalling approximately 37,510km(2).

 

 

Figure 1: Map of PL001 and Sea Lion Development

 

Forward-Looking Statements

 

Statements contained in this document that are not historical facts are
forward-looking statements that involve various risks and uncertainty
affecting the business of Eco. Such statements can be generally, but not
always, identified by words such as "expects", "plans", "anticipates",
"intends", "estimates", "forecasts", "schedules", "prepares", "potential" and
similar expressions, or that events or conditions "will", "would", "may",
"could" or "should" occur. All estimates and statements that describe Eco's
operations are forward-looking statements under applicable securities laws and
necessarily involve risks and uncertainties including, without limitation:
risks associated with oil and gas exploration, development, exploitation and
production, geological risks, marketing and transportation, the risk
associated with estimating prospective resources described below, availability
of adequate funding, volatility of commodity prices, imprecision of reserve
estimates, environmental risks, competition from other producers, and changes
in the regulatory and taxation environment. Actual results may vary materially
from the information provided in this document, and there is no representation
by the Company that the actual results realized in the future will be the same
in whole or in part as those presented herein. Eco undertakes no obligation,
except as otherwise required by law, to update these forward-looking
statements in the event that management's beliefs, estimates or opinions, or
other factors change.

 

Resource Estimates

 

The resource estimates in this announcement, where applicable, are prepared by
independent and non-independent qualified reserves evaluators in accordance
with NI 51-101 and the COGE Handbook.

 

Best Estimate is considered to be the best estimate of the in-place volumes
that will actually be present. It is equally likely that the actual in-place
volumes will be greater or less than the best estimate. If probabilistic
methods are used, there should be at least a 50 percent probability (P50) that
the in-place volumes will equal or exceed the best estimate.

Prospective resources are those quantities of petroleum estimated, as of a
given date, to be potentially recoverable from undiscovered accumulations by
application of future development projects. Prospective resources have both an
associated chance of discovery and a chance of development. There is no
certainty that any portion of the resources will be discovered. If discovered,
there is no certainty that it will be commercially viable to produce any
portion of the resources.

 

Exploration for hydrocarbons is a speculative venture necessarily involving
substantial risk. The Company's future success in exploiting and increasing
its current reserve base will depend on its ability to develop its current
properties and on its ability to discover and acquire properties or prospects
that are capable of commercial production. However, there is no assurance that
the Company's future exploration and development efforts will result in the
discovery or development of additional commercial accumulations of oil and
natural gas. In addition, even if further hydrocarbons are discovered, the
costs of extracting and delivering the hydrocarbons to market and variations
in the market price may render uneconomic any discovered deposit. Geological
conditions are variable and unpredictable. Even if production is commenced
from a well, the quantity of hydrocarbons produced inevitably will decline
over time, and production may be adversely affected or may have to be
terminated altogether if the Company encounters unforeseen geological
conditions. The Company is subject to uncertainties related to the proximity
of any reserves that it may discover to pipelines and processing facilities.
It expects that its operational costs will increase proportionally to the
remoteness of, and any restrictions on access to, the properties on which any
such reserves may be found. Adverse climatic conditions at such properties may
also hinder the Company's ability to carry on exploration or production
activities continuously throughout any given year.

 

The significant positive factors that are relevant to the resource estimate
are:

 

·    Proven commercial quality reservoirs in close proximity; and

·    Oil and gas shows while drilling wells nearby.

 

The significant negative factors that are relevant to the resource estimate
are:

 

·    Tectonically complex geology could compromise seal potential; and

·    Seismic attribute mapping can be indicative but not certain in
identifying proven resource.

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