TIDMECO
RNS Number : 8494H
Eco (Atlantic) Oil and Gas Ltd.
29 November 2022
29 November 2022
ECO (ATLANTIC) OIL & GAS LTD.
("Eco," "Eco Atlantic," "Company," or together with its
subsidiaries, the "Group")
Unaudited Results for the six months ended 30 September 2022
Corporate and Operational Update
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 results for the six
months ended 30 September 2022 and to provide a corporate and
operational update.
Highlights:
Financials (as at 30 September 2022)
-- The Company had cash and cash equivalents of US$24.6 million
and no debt (after paying US$11.3 million, being Eco's cash share
of the Block 2B well) as of September 30, 2022.
-- The Company had total assets of US$67.3 million, total
liabilities of US$5.7 million and total equity of US$61.6
million.
-- As of November 27, 2022, the Company is expected to have
approximately US$ 1 7.5 million cash and cash equivalents at the
end of November 2022, following receipt of the initial proceeds
from the sale of the Kozani project in the coming days referred to
below.
Corporate:
-- On November 28, 2022, the Company closed the sale of its 100%
interest in the Kozani Photovoltaic Development Project for total
cash proceeds of EUR2.3 million (US$2.4 million). US$2 million is
to be received by the Company by close of business on November 30,
2022, and the outstanding balance is expected to be received by
year end 2022.
-- After 12 years with the Company, Eco's Non-executive
Chairman, Moshe 'Peter' Peterburg has informed the Board of his
plans to retire, as such, he will not stand for re-election at the
upcoming Annual General Meeting on December 29, 2022, and will step
down from the Company with immediate effect. The Company has
commenced the process to find a replacement and, in the interim,
Peter Nicol, currently a Non-executive Director, will assume the
role of interim Non-executive Chairman. Further announcements will
be made as appropriate.
-- With regard to the closing of the acquisition of Azinam Group
Limited ("Azinam"), and in accordance with the previously announced
Share Purchase Agreement, the Company will shortly 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. These Common Shares are subject to a restrictive hold
period of four months and one day (beginning on the date of
issuance). The issuance of Common Shares is subject to approval
from the TSX Venture Exchange and a further announcement will be
made once such approval has been received and the Common Shares
issued.
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.
-- 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
-- Following recent significant hydrocarbon discoveries offshore
Namibia, Eco continues to assess options for progressing
exploration and commercial activity on its acreage.
-- Eco is witnessing considerable interest in its licences in
Namibia and is currently assessing options, including a potential
farm-out.
Guyana
-- 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 March 31,
30,
------------------------------------------------
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, 13,764 -
net
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 67,406 -
license partners, net
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 - 21,007 - -
interests
------------------------ ------------------- ------------------------ -----------------------
(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 184,605 -
for at equity
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 (171,294) -
cashflows
Net change in non-cash working capital 419,113 -
items relating to discontinued operations
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 +1 (403) 606 4852
Simon Akit +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 km(2) 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
km(2) 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 km (2) .
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END
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(END) Dow Jones Newswires
November 29, 2022 02:00 ET (07:00 GMT)
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