3 February 2020
ECO (ATLANTIC) OIL & GAS LTD.
("Eco," "Eco Atlantic," "Company," or together with its subsidiaries, the "Group")
New Competent Persons Resource Report on Orinduik Block, offshore Guyana
29% Increase in Gross Prospective Resources P50 (Best) to 5,141 MMBOE
Eco (Atlantic) Oil & Gas Ltd. (AIM: ECO, TSX‐V: EOG), is pleased to announce the publication of an updated NI 51-101 compliant Competent Persons Report ("CPR") on the Orinduik Block offshore Guyana ("Orinduik Block"). The CPR was compiled by Gustavson Associates LLC, of Boulder Colorado, USA, an independent third-party auditor.
Highlights:
· Significant increase in Gross Prospective Resources to 5,141 MMBOE (771 MMBOE net to Eco) from previous estimate of Gross Prospective Resources of 3,981 MMBOE in March 2019.
· 22 prospects identified on Orinduik Block including 11 leads in the Upper Cretaceous horizon.
· Majority of the project leads have over a 30% or better chance of success (COS), enhanced by the recent discovery of light oil on the Kanuku block to the south of Orinduik.
· Leads in the Tertiary aged section estimated to contain 1,204 MMBOE, and within the Cretaceous section are estimated to contain approximately 3,936 MMBOE.
· Two targets in the Cretaceous horizon (Amaila/Kumaka and Iatuk-D) are identified as having in excess of 725 MMBOE each.
The JV Partners in the Orinduik Block, Tullow and Total, along with Eco Atlantic, have an Operations Committee meeting scheduled in early February 2020 to evaluate recent drilling results, define drilling targets, and consider the budgets and dates for future drilling. In late 2019, the JV Partners approved a provisional budget for 2020 subject to JV drilling approvals. Eco Atlantic has a robust cash position, with over US $20 million cash and cash equivalents (as at 30 September 2019), and is fully funded for its share of further appraisal and exploration drilling at Orinduik of up to US$120m (gross).
The JV Partners are Eco Atlantic (15% working interest ("WI")), Tullow Guyana B.V. ("Tullow") (Operator, 60% WI) and Total E&P Guyana B.V. ("Total") (25% WI).
Colin Kinley, co-founder and Chief Operating Officer of Eco Atlantic, commented:
"We are pleased to announce a new and updated CPR for our Orinduik Block offshore Guyana. The understanding of our resources has gained strength and momentum with the discoveries we made in the Tertiary last summer and the recent discovery of light oil in Carapa-1, made on the Kanuku block to the south of us. This has also been driven by the discoveries of over 8 billion barrels of oil immediately East of us by ExxonMobil.
"Our choice was to first test the Tertiary section and to take the risk of opening a new play and a new opportunity for Guyana. As previously announced, this younger section delivered a significant resource of heavy oil pay. Heavy oil is more challenging to produce than conventional lighter oils, but remains a marketable hydrocarbon with increasing demand world-wide, as other heavy oil resources have dropped offline. Interpretation of this play has continued and has seen material growth in the interpreted resources. The Company is conducting in depth evaluation of the economics of this play, with independent third party economic advisory support.
"The Cretaceous pathway of lighter weight oils from the source kitchen to the north, through the Liza sands and through the recent discovery of light oil in Carapa-1 to the south confirms our theory and interpretation of transmission of high-quality oil across the Cretaceous sand channels and traps within the Orinduik Block.
"We have seen a growth of the overall oil numbers with the thickness of section and a greater understanding of the areal extent and thicknesses of our sands. Most importantly, however, is our exploration risking, with confirmation that over half of our 22 leads now have an independently assessed 30% or greater COS. Our confidence in the play continues and was greatly enhanced with the now proven light oil in the Cretaceous section immediately to the south.
"Significant exploration potential is what brought us into Guyana before the first barrel was discovered by ExxonMobil. The elements are all here. We know that the geology and the geography support us and we have a great team to fine tune the next drilling targets. We have strong partners in Eco and on the block, so as we define our targets, we are well funded and are considering our options to drill as soon as practically possible."
Gross and Net (to Eco) Barrels of Oil Equivalent Unrisked Prospective Resources
|
Gross Prospective Oil Equivalent Resources, MMBOE |
Net Prospective Oil Equivalent Resources, MMBOE |
Orinduik Block |
Low Estimate |
Best Estimate |
High Estimate |
Low Estimate |
Best Estimate |
High Estimate |
TOTAL |
2,614.6 |
5,141.3 |
9,313.8 |
392.2 |
771.2 |
1,397.1 |
(MMBOE = million barrels of oil equivalent)
Orinduik Block Leads Gross Unrisked Prospective Resources with Probability of Success
Lead |
Gross Unrisked Prospective Oil Resources (P50) MMBOE |
Risk POS% |
Tertiary Leads |
|
|
Jethro |
208.3 |
100.00 |
Hammerhead |
15 |
81.00 |
Joe |
104.4 |
100.00 |
Jethro Ext |
53.8 |
43.20 |
Jimmy |
68.4 |
64.60 |
Jethro Chan |
137.3 |
41.70 |
Alice |
196.7 |
31.20 |
Kurty U |
42.8 |
29.70 |
Kurty L |
35.8 |
29.70 |
Jethro KW |
158.5 |
33.60 |
Jethro West |
183.8 |
33.60 |
TOTAL TERTIARY |
1204.8 |
|
Cretaceous Leads |
|
|
KB |
339.6 |
31.50 |
Rappu |
500.1 |
35.10 |
DJ |
173.9 |
33.70 |
KG |
724.7 |
31.20 |
Amaila/Kumaka |
775.8 |
31.50 |
Iatuk-D |
725.3 |
31.20 |
KC |
47.5 |
26.40 |
Amatuk |
267.3 |
28.80 |
MJ-3 |
263.5 |
28.80 |
KC-A |
73.8 |
26.40 |
EriKat |
45.1 |
30.60 |
TOTAL CRETACEOUS |
3936.6 |
|
(MMBOE = million barrels of oil equivalent, POS = Probability of Success)
A link to the full CPR Report can be viewed online at www.sedar.com and both the CPR is available on the Company's website: www.ecooilandgas.com.
Qualified Person's Statement:
Kevin S. Weller, Executive Vice President of Gustavson Associates LLC, has reviewed the technical information contained within this announcement for the purposes of the current Guidance Note for Mining, Oil and Gas Companies issued by the London Stock Exchange. Kevin S. Weller is Registered Professional Engineer in the States of Colorado, Texas, New Mexico, Utah and Wyoming and has over 35 years' experience in the conduct of evaluation and engineering studies relating to oil and gas fields.
All Reserves and Resources definitions and estimates detailed in this announcement are based on the 2007 SPE/AAPG/WPC/SPEE Petroleum Resource Management System ("PRMS").
For more information, please visit www.ecooilandgas.com or contact the following:
Eco Atlantic Oil and Gas |
+1 (416) 250 1955 |
Gil Holzman, CEO Colin Kinley, COO Alice Carroll, Head of Marketing and IR |
+44(0)781 729 5070 |
Strand Hanson Limited (Financial & Nominated Adviser) |
+44 (0) 20 7409 3494 |
James Harris James Bellman |
|
Stifel Nicolaus Europe Limited (Joint Broker) Callum Stewart Ashton Clanfield |
+44 (0)20 7710 7600 |
Berenberg (Joint Broker) |
+44 (0) 20 3207 7800 |
Matthew Armitt Detlir Elezi |
|
Celicourt (PR) |
+44 (0) 20 8434 2754 |
Mark Antelme Jimmy Lea Hannam & Partners (Research Advisor) Neil Passmore Hamish Clegg Canaccord Genuity (North American Advisor) Simon Akit |
+44 (0) 20 7905 8500 +1 416 869 3820 |
The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014.
Notes to editors:
About Eco Atlantic:
Eco Atlantic is a TSX-V and AIM quoted Oil & Gas exploration and production Company with interests in Guyana and Namibia, where significant oil discoveries have been made.
The Group aims to deliver material value for its stakeholders through oil exploration, appraisal and development activities in stable emerging markets, in partnership with major oil companies, including Tullow, Total and Azinam.
In Guyana, Eco Guyana holds a 15% working interest alongside Total (25%) and Tullow Oil (60%) in the 1,800 km2 Orinduik Block in the shallow water of the prospective Suriname-Guyana basin. The Orinduik Block is adjacent and updip to ExxonMobil and Hess Corporation's Stabroek Block, on which sixteen discoveries have been announced and over 8 Billion BOE of oil equivalent recoverable resources are estimated. First oil production commenced in December 2019 from the deep-water Liza Field, less than 3 years from FID.
Jethro-1 was the first major oil discovery on Orinduik Block. The Jethro-1 encountered 180.5 feet (55 meters) of net high-quality oil pay in excellent Lower Tertiary sandstone reservoirs which further proves recoverable oil resources. Joe-1 is the second discovery on the Orinduik Block and comprises high quality oil-bearing sandstone reservoir with a high porosity of Upper Tertiary age. The Joe-1 well encountered 52 feet (16 meters) of continuous thick sandstone which further proves the presence of recoverable oil resources.
In Namibia, the Company holds interests in four offshore petroleum licences totalling approximately 25,000km2 with over 2.3bboe of prospective P50 resources in the Walvis and Lüderitz Basins. These four licences, Cooper, Guy, Sharon and Tamar are being developed alongside partners Azinam and NAMCOR. Eco has been granted a drilling permit on its Cooper Block (Operator).
