REG - Eco (Atlantic) O&G - Audited Results for the Year Ended 31 March 2023
01/08/2023 07:00
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RNS Number : 8758H Eco (Atlantic) Oil and Gas Ltd. 01 August 2023
1 August 2023
ECO (ATLANTIC) OIL & GAS LTD.
("Eco," "Eco Atlantic," "Company," or together with its subsidiaries, the
"Group")
Audited Results for the Year Ended 31 March 2023
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 audited results for the year ended 31 March 2023.
Highlights:
Financials (as at 31 March 2023)
· The Company had cash and cash equivalents of US$3,770,614 and no
debt.
· Eco has cash and cash equivalents of US$6.4 million on the balance
sheet as at 31 July 2023.
· The Company had total assets of US$53,777,531, total liabilities of
US$5.9 million and total equity of US$48 million.
Operations:
South Africa
Block 3B/4B
· Post period end, the Company signed a legally binding Letter of
Intent with Africa Oil to farm out a 6.25% Participating Interest in Block
3B/4B, offshore South Africa for up to US$10.5 million in cash.
· In March 2023, Africa Oil released a New Competent Person's Resource
Report confirming that the Block contains an estimated P50 Prospective
Resources of approximately four billion barrels of oil equivalent ("BOE"), one
Billion BOE net to Eco Atlantic prior to the sale of the aforementioned
Participating Interest which is expected to complete shortly.
· Eco, alongside its JV Partners, applied for Environmental
Authorisation to undertake exploration activities in Block 3B/4B in the Orange
Basin. An application was made to drill one well and one contingent well with
an area of interest in the north of the Block. A comprehensive Environmental
and Social Impact Assessment ("ESIA") process commenced in March 2023, in
preparation for drilling activity on the Block.
· The JV partners continue to progress plans to conduct a two-well
campaign on the Block in conjunction with progressing the collaborative farm
out process, up to 55% gross working interest, with various potential parties.
Block 2B
· On November 15, 2022, a Production Right Application to the Petroleum
Agency of South Africa, for Block 2B, based on the existing oil discovery of
AJ-1 and potential future operations was submitted by the JV Partners.
· Eco continues to believe that Block 2B contains considerable
hydrocarbon resources and looks forward to providing further updates as the
Company looks to deliver value from the licence for all stakeholders.
Namibia
· Following the significant drilling success in the area, Eco continues
to receive third party interest in its strategic acreage position offshore
Namibia.
· The Company continues to assess farm out opportunities with its four
licences in the region as it considers options for progressing exploration and
commercial activity on its acreage.
Guyana
· Eco Atlantic and its JV partners remain committed to further drilling
on the Orinduik Block and continue assessing opportunities to drill at least
two exploration wells into the light oil cretaceous targets as soon as
practical. Further updates will be made on the matter in due course.
Gil Holzman, President and Chief Executive Officer of Eco Atlantic,
commented:
"As a business we continue to make significant strides across our strategic
portfolio of hydrocarbon assets, in some of the world's most prolific
exploration areas. Following the stabilizing of commodity prices during the
first half of this year, alongside a number of discoveries being made in and
around the regions we operate in, we continue to see strong industry interest
in our unique acreage positions in Orange Basin SA, Walvis Basin Namibia, and
the Guyana Suriname Basin.
"The agreed transfer of a portion of our WI on Block 3B/4B to our strategic
alliance partner Africa Oil will strengthen the JV position amid our continued
negotiations with third parties to farm into the Block and execute a drilling
campaign targeted for 2024. The proceeds from this agreement give us the
opportunity to fund other growth opportunities elsewhere in the portfolio with
no shareholder dilution. Also, at 3B/4B, we applied for Environmental
Authorisation to undertake further drilling exploration activities as we
believe that the licence holds significant potential to be explored by the
Joint Venture partnership in South Africa.
"Namibia continues to produce globally significant hydrocarbon discoveries,
and as a sizeable licence holder in the region, Eco continues to benefit from
heightened levels of industry interest in the area.
"As a Board and Management team, we continue to assess and progress value
accretive opportunities across our portfolio, with the goal of delivering
substantial shareholder returns over the medium to long term.
"We remain excited about our prospects, and I look forward to providing
further updates to the markets during the remainder of the year."
Issue of Azinam Shares, Admission and Total Voting Rights
In addition, further to the Company's announcement of 29 November 2022
regarding the closing of the acquisition of Azinam Group Limited ("Azinam")
and in accordance with the previously announced Share Purchase Agreement, the
Company has received TSX Venture Exchange approval to issue the balance of
1,625,000 Common Shares ("Azinam Shares") to the previous shareholders of
Azinam representing the full and final number of Common Shares to be issued in
respect of this transaction.
Application has been made for admission of the 1,625,000 Azinam Shares, which
will rank pari passu with existing Common Shares, to trading on AIM
("Admission"). It is expected that Admission will become effective, and
trading in the Azinam Shares will commence, on or around 8:00 a.m. on 2 August
2023.
On Admission, the enlarged issued share capital of the Company will be
370,173,680 Common Shares. The above figure may be used by shareholders as the
denominator for the calculations by which they will determine if they are
required to notify their interest in, or a change to their interest in, the
share capital of the Company.
The Company's audited financial statement for the year ended 31 March 2023 is
available for download on the Company's website at www.ecooilandgas.com
(http://www.ecooilandgas.com) and on Sedar at www.sedar.com
(http://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
March 31, March 31,
2023 2022
Assets
Current Assets
Cash and cash equivalents 4,110,734 3,438,834
Short-term investments 13,107 52,618
Government receivable 22,494 27,487
Amounts owing by license partners, net 477,578 -
Accounts receivable and prepaid expenses 1,529,451 257,911
Assets held for sale - 2,061,734
Total Current Assets 6,153,364 5,838,584
Non- Current Assets
Investment in associate 8,612,267 9,277,162
Petroleum and natural gas licenses 40,852,020 30,753,034
Total Non-Current Assets 49,464,287 40,030,196
Total Assets 55,617,651 45,868,780
Liabilities
Current Liabilities
Accounts payable and accrued liabilities 4,416,789 1,931,823
Advances from and amounts owing to license partners, net 286,553 -
Current liabilities related to assets held for sale - 473,254
Warrant liability 261,720 3,241,762
Total Current Liabilities 4,965,062 5,646,839
Total Liabilities 4,965,062 5,646,839
Equity
Share capital 121,570,983 63,141,609
Shares to be issued - 20,766,996
Restricted Share Units reserve 920,653 267,669
Warrants 14,778,272 7,806,000
Stock options 2,804,806 958,056
Foreign currency translation reserve (1,458,709) (1,309,727)
Accumulated deficit (87,963,416) (51,408,662)
Total Equity 50,652,589 40,221,941
Total Liabilities and Equity 55,617,651 45,868,780
Income Statement
Year ended
Mar
ch
31,
2023 2022
Revenue
Interest income 66,571 3,556
66,571 3,556
Operating expenses:
Compensation costs 905,974 852,383
Professional fees 694,304 551,751
Operating costs, net 33,039,264 1,932,826
General and administrative costs 848,893 603,145
Share-based compensation 2,968,294 14,495
Foreign exchange loss (gain) 559,947 (116,631)
Total operating expenses 39,016,676 3,837,969
Operating loss (38,950,105) (3,834,413)
Fair value change in warrant liability 2,980,042 (263,136)
Share of losses of company accounted for at equity (664,895) (1,154,838)
Net loss for the year from continuing operations (36,634,958) (5,252,387)
Gain (loss) from discontinued operations, after-tax 80,204 (1,304,937)
Net loss for the year (36,554,754) (6,557,324)
Foreign currency translation adjustment (148,982) (111,630)
Comprehensive loss for the year (36,703,736) (6,668,954)
Basic and diluted net loss per share:
from continuing operations (0.105) (0.027)
from discontinued operations 0.000 (0.007)
Weighted average number of ordinary shares used in computing basic and diluted 349,622,239 195,869,114
net loss per share
Cash Flow Statement
Year ended
March 31,
2023 2022
Cash flow from operating activities - continued operations
Net loss from continuing operations (36,634,958) (5,252,387)
Items not affecting cash:
Share-based compensation 2,968,295 14,495
Revaluation of warrant liability (2,980,042) 263,136
Share of losses of companies accounted for at equity 664,895 1,154,838
Changes in non‑cash working capital:
Government receivable 4,993 (4,790)
Accounts payable and accrued liabilities 2,484,966 (7,279)
Accounts receivable and prepaid expenses (1,271,540) 530,121
Reallocation to discontinued operations cashflows - (317,340)
Advance from and amounts owing to license partners (191,025) -
(34,954,416) (3,619,206)
Cash flow from operating activities - discontinued operations (839,029) (1,008,182)
Cash flow from investing activities
Investment in associate - (10,000,000)
Short-term investments 39,511 1,500,022
Acquisition of interest in property (1,598,986) -
(1,559,475) (8,499,978)
Cash flow from investing activities - discontinued operations 2,507,713 -
Cash flow from financing activities
Proceeds from private placements, net 35,666,089 4,793,814
Acquisition of Azinam - 2,590
Exercise of stock options - 74,212
35,666,089 4,870,616
Increase (decrease) in cash and cash equivalents 820,882 (8,256,750)
Foreign exchange differences (148,982) (111,725)
Cash and cash equivalents, beginning of year 3,438,834 11,807,309
Cash and cash equivalents, end of year 4,110,734 3,438,834
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 Limited (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 +1 (403) 606 4852
Simon Akit +1 (416) 8497776
Celicourt (PR) +44 (0) 20 7770 6424
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 26.25% Working Interest in Block 3B/4B operated by Africa Oil
Corp., totalling some 20,643km2.
Cautionary Notes:
This news release contains certain "forward-looking statements", including,
without limitation, statements containing the words "will", "may", "expects",
"intends", "anticipates" and other similar expressions which constitute
"forward-looking information" within the meaning of applicable securities
laws. Forward-looking statements reflect the Company's current expectations,
assumptions, and beliefs, and are subject to a number of risks and
uncertainties that could cause actual results to differ materially from those
anticipated. These forward-looking statements are qualified in their entirety
by the inherent risks and uncertainties surrounding future expectations.
Important factors that could cause actual results to differ materially from
expectations include, but are not limited to, general economic and market
factors, competition, the effect of the global pandemic and consequent
economic disruption, and the factors detailed in the Company's ongoing filings
with the securities regulatory authorities, available at www.sedar.com
(http://www.sedar.com) . Although forward-looking statements contained herein
are based on what management considers to be reasonable assumptions based on
currently available information, there can be no assurance that actual events,
performance or results will be consistent with these forward-looking
statements, and our assumptions may prove to be incorrect. Readers are
cautioned not to place undue reliance on these forward-looking statements. The
Company undertakes no obligation to publicly update or revise any
forward-looking statements either as a result of new information, future
events or otherwise, except as required by applicable laws.
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