President and Chief Executive Officer of Eco Atlantic Oil and Gas Limited Gil Holzman has revealed that his company has struck a deal with the Namibian Government to delay planned 3D Survey programs on its Guy and Sharon Blocks by at least one year to March 2016.
The Toronto based company also listed on the Namibian Stock Exchange also revealed that it has taken strategic actions to decrease its near to mid-term financial obligations by farming out part of its offshore Namibian licenses on a carry and cash basis.
In a statement released by the company yesterday Eco Atlantic revealed that the move will result in a revised and reduced year work program in Namibia.
Through its wholly-owned subsidiary, Eco Oil and Gas (Namibia) (Pty) Limited ("Eco Namibia"), Eco Atlantic also entered into an Amended and Restated Farmout Agreement (the "Agreement") with Azinam Limited ("Azinam"), amending and restating the terms of the farmout agreement dated April 12, 2012, among the parties.
“Pursuant to the Agreement, the Company will receive a total of approximately CAD$4.2 million (US$3.65 million) in cash and will further reduce its financial commitments on its offshore petroleum blocks, the statement released by the president read,”Holzman said.
As part of the Agreement Eco Atlantic agreed to transfer an additional 10% participating interest in Blocks 2111B and 2211A offshore Namibia (the "Guy Block") to Azinam, in exchange for Azinam funding USD$1 million(Approximately N$11m) for 100% of the recently completed 1,000 KM 2D seismic survey and associated processing.
Azinam will also pay for 66.44% of a 800km2 3D seismic program on the Guy Block to be completed within the next 15 months. In addition, Azinam will pay US$150,000 in cash.
“The Company currently holds a 60% participating interest in the Guy Block subject to regulatory approval of previously announced farm-out. Post the transaction, the Company will transfer Operatorship of the Guy Block to Azinam, and following the closing of the transaction set out in the Agreement, the Company will hold a 50% participating interest. NAMCOR has a 10% carried interest,” .
The Company has also agreed to transfer an additional 10% participating interest in Blocks 2213A and 2213B offshore Namibia (the "Sharon Block") to Azinam in exchange for the full carry of 3,000 km of recent 2D data acquired on this block. Further, Azinam will fund 54% of a 1,000km2 3D seismic survey to be completed in the next 15 months.
Through Eco Namibia, the Company currently holds a 70% participating interest in the Sharon Block. Following the closing of the transaction set out in the Agreement, the Company will hold a 60% participating interest in the Sharon Block and maintain Operatorship. NAMCOR has a 10% carried interest.
The Company has agreed to transfer an additional 12.5% participating interest in Block 2012A offshore Namibia (the "Cooper Block") to Azinam in exchange for US$3.5 million in cash. Azinam's working commitments on the Cooper Block was not amended by the Agreement.
Through Eco Namibia, the Company currently holds a 45% participating interest in the Cooper Block. Following the closing of the transaction set out in the Agreement, the Company will hold a 32.5% carried interest in the Cooper Block; Azinam will hold 32.5%; Tullow Oil holds a 25% working interest and NAMCOR has a 10% carried interest in the block.
The closing of the transaction set out in the Agreement is subject to regulatory approvals by the Ministry of Mines and Energy of Namibia.
Gil Holzman also added that, "We are delighted to have the opportunity to enter into this transaction with our long time strategic block partner, Azinam. With the significant reduction of our financial commitments on the blocks over the short to medium term on the one hand, and with earning meaningful cash contribution on the other, we are perfectly positioned to further progress our offshore licenses in Namibia together with our partners Azinam and Tullow Oil, and explore additional opportunities. “
Eco Atlantic is an oil and gas exploration company focused on the acquisition and development of unique upstream petroleum opportunities around the world. The Company's objective is to identify technically merited prospective new and developing projects in frontier areas requiring low cost entry.
Through a wholly owned Namibian subsidiary ("Eco Namibia"), the Company currently holds three offshore petroleum license blocks covering more than 25,000 square kilometers in the Walvis Basin and one license block covering 23,000 square kilometers, which includes both onshore and offshore areas. Founded in 2008, Eco Namibia enjoys a strong local presence and has a longstanding relationship with the