Provides Onshore License Update
TORONTO, April 12, 2012 /PRNewswire/ - ECO (ATLANTIC)
OIL AND GAS LTD. (TSX-V:EOG) Eco (Atlantic) Oil & Gas Ltd.
("Eco Atlantic" or the "Company") is pleased to
announce that it has signed a definitive Farm-out Agreement with
Azimuth Ltd. ("Azimuth") of Hamilton, Bermuda, an exploration and
production company backed by majority-owner Seacrest Capital Ltd.
and Petroleum Geo-Services ASA ("PGS") (Letter of Intent
announced on December 22, 2011).
Pursuant to the agreement, Azimuth will earn a
20% working interest in each of Eco Atlantic's offshore
Namibia licenses, namely the
"Cooper License" (Block 2012A), the "Sharon License" (Blocks 2213A
& 2213B) and the "Guy License" (Blocks 2111B & 2211A)
(jointly, the "Licenses") in return for funding 40% of the
cost of 3D seismic surveys covering 2,500 square kilometers across
all three Licenses, the acquisition of which is expected to cost in
excess of US$25 million.
The assignment of a 20% working interest in the
Licenses to Azimuth is subject to the approval of Namibia's Ministry of Mines and Energy.
Eco Atlantic currently holds a 90% working
interest in the Licenses through its wholly-owned subsidiary Eco
Oil and Gas Namibia (PTY) Ltd. ("Eco Namibia") and NAMCOR,
the Namibian national oil and Gas Company, holds a 10% working
interest. As a result of this transaction, Eco Namibia's interest
will be 70%, Azimuth will earn a 20% interest, and NAMCOR will
retain its 10% carried interest. Eco Atlantic, through the project
management group of Kinley Exploration and Azimuth will be
responsible for designing, sourcing and operating all aspects of
the 3D seismic program.
Gil Holzman,
President and Chief Executive Officer of Eco Atlantic
commented, "Eco Atlantic is excited to have executed the
Farm-out Agreement thereby securing the relationship with Azimuth
as a license and technical partner. This partnership will enhance
the technical ability brought to analyze the Licenses, thereby
reducing the execution risk and strengthening the Company's
technical ability to perform its offshore Namibia 3D Geophysical program. The cost of
the 3D program is approximately US $25million on all three offshore blocks, and the
Company's current balance sheet combined with Azimuth's
contribution covers the majority of the cost associated with our
program."
Aaron D'Este, Managing Director of Azimuth
Management Ltd., commented, "We are delighted to have
executed the Farm-out Agreement with Eco Atlantic. Namibia is a very promising petroleum province
and we have evaluated numerous farm-in opportunities across the
country. Eco Atlantic's portfolio of offshore acreage is among the
most exciting, spanning three distinct environments, each with
excellent prospectivity. Azimuth has access to the world's
largest library of 3D seismic and to a team of 85 subsurface
experts with extensive experience in West
Africa. Our team assessed Eco's assets independently
and we support the volumetrics and conclusions in Gustavson's
reports. The quality and diversity of the prospects on Eco
Atlantic's offshore acreage is excellent. We look forward to
working closely with Eco Atlantic to define and execute the
technical program required to produce robust drilling targets as
quickly and safely as possible."
Update on Onshore Licenses.
On December 8,
2011, the Company announced that it had entered into a
Farm-out Agreement (the "FOA") with West Bay Investments,
Ltd. ("West Bay") in which
West Bay farmed into both of the
Company's CBM onshore license blocks (Blocks 2013B, 2014B, 2114 and
2418 collectively the "Onshore Licenses"). Eco Atlantic
announces that it has terminated the FOA with West Bay due to West
Bay's material breach of the terms and conditions set out
therein. The failure of West
Bay to satisfy the terms and conditions of the FOA renders
the 50% working interest it was to have to in the onshore licenses
null and void. Subsequent to the termination of the FOA, the
Company's interest in the Onshore Licenses reverts to 90% with
NAMCOR maintaining a 10% interest.
The Company is pleased to announce that it has
successfully completed and submitted its desk top studies and the
Environmental Assessment Surveys on both its Onshore Licenses.
Based on the desk top studies, the Company intends to identify
drilling targets on its blocks. For that purpose, the Company has
been granted an extension to complete the drilling of at least 1
well on its onshore Licenses, to a time no later than the expiry of
the first term, being March 2015.
About Eco Atlantic
Eco Atlantic is an oil and gas exploration
company focused on the new and bourgeoning energy play in
Namibia. Through its wholly owned
Namibian subsidiary, Eco Namibia, it holds five petroleum licenses
issued by the Government of the Republic of Namibia. Eco Namibia holds three offshore
license blocks covering more than 25,000 square kilometers
(6,177,000 acres). Eco Namibia also holds two onshore license
blocks covering 30,000 square kilometers (7,413,000
acres). Eco Namibia, founded in 2008, enjoys a strong local
presence, and has a longstanding relationship with the energy and
oil and gas sector in Namibia and
in the region. The terms and conditions of these licenses are
regulated by agreements signed by Eco with the Government of the
Republic of Namibia in
March 2011.
About Azimuth
Azimuth Limited is a specialist E&P company
based in Hamilton, Bermuda.
The business is backed by majority-owner Seacrest Capital
Ltd, a Bermuda based energy
investment group, and Petroleum Geo-Services ASA (PGS).
Azimuth leverages the strength of its
shareholders to acquire interests in prospective acreage worldwide,
developing 'drill-ready' targets through robust geophysical and
commercial analysis. Funding from Seacrest fuels Azimuth's
global activities and ensures that the company is ready to advance
its properties without delay. A collaboration agreement with
PGS gives Azimuth unparalleled insight into petroleum basins
worldwide, including access to the world's largest multiclient
seismic library, to leading edge geophysical expertise and to 85
subsurface specialists distributed in key locations around the
world.
With four attractive assets already in hand,
Azimuth Ltd is a well-funded, rapidly-growing exploration company
equipped with the technical capabilities of a mid-cap E&P firm.
Azimuth's management team is led by Aaron D'Este.
Forward Looking Statements
CAUTIONARY NOTE REGARDING FORWARD LOOKING
STATEMENTS: Certain information in this press release constitutes
forward-looking statements under applicable securities law. Any
statements that are contained in this press release that are not
statements of historical fact may be deemed to be forward-looking
statements. Forward-looking statements are often identified by
terms such as "may", "should", "anticipate", "expects" and similar
expressions. Forward-looking statements necessarily involve
known and unknown risks, uncertainties and other factors which may
cause the actual results, performance or achievements of Eco
Atlantic to be materially different from any future results,
performance or achievements expressed or implied by the
forward-looking statements.
Such factors include, without limitation,
risks associated with oil and gas production and exploration,
marketing and transportation; loss of markets; volatility of
commodity prices; currency and interest rate fluctuations;
environmental risks; competition; inability to access sufficient
capital from internal and external sources; government regulation
of petroleum and natural gas matters; environmental risks;
unanticipated reclamation expenses; title disputes or claims,
termination or amendment of existing contracts; actual results of
drilling activities; conclusions of economic evaluations; failure
of plant, equipment or processes to operate as anticipated;
accidents, labour disputes and other risks of the petroleum and
natural gas industries and delays in obtaining or failure to obtain
any governmental approvals or licenses. . Readers are cautioned
that the foregoing list of factors is not exhaustive.
Although Eco Atlantic believes in light of
the experience of its officers and directors, current conditions
and expected future developments and other factors that have been
considered appropriate that the expectations reflected in this
forward-looking information are reasonable, undue reliance should
not be placed on them because Eco Atlantic can give no assurance
that they will prove to be correct. The forward-looking statements
contained in this press release are made as of the date hereof and
Eco Atlantic undertakes no obligation to update publicly or revise
any forward- looking statements or information, whether as a result
of new information, future events or otherwise, unless so required
by applicable securities laws.
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 press release.
SOURCE Eco Oil & Gas (Atlantic) Ltd.
