Canadian company joins hunt for oil close to ExxonMobil’s ‘Liza’ discovery

Nov 14, 2017 News

More international firms are finding a pathway into Guyana’s newfound oil and gas market through partnerships and investment opportunities via existing licence holders.
Africa Oil Corp. (AOC), a Canadian oil and gas company with assets in Kenya and Ethiopia, and an equity interest in Africa Energy Corp., has joined the hunt for oil in Guyana.
The company has entered into a ‘strategic partnership’ with Eco (Atlantic) Oil and Gas Ltd., which holds an interest in the 1,800 square kilometer Orinduik offshore block in close proximity to the ExxonMobil’s recently announced “Liza” discovery holding multi-million barrels of oil.
Under the terms of the investment agreement, AOC has agreed to acquire a 19.77% shareholding in ECO through a purchase via a private placement of 29.2 million common shares for a total consideration of CAD$14 million.
The Investment Agreement also provides the Company with the right to participate in any future ECO equity issuances, on a pro rata basis, and to appoint one nominee to ECO’s board of directors. According to a joint statement, Keith Hill, president and CEO of AOC, is expected to join the ECO board of directors as soon as practicable.
ECO holds a block directly updip from the Stabroek block on which Exxon estimates resources of about 2.5 billion to 2.8 billion barrels of oil, including the super-giant Liza field.
According to EOC, the Orinduik offshore block exhibits good evidence of slope fan prospects and is expected to be fully delineated after processing and interpretation of the 3D seismic survey recently completed in September.
ECO also recently announced it has entered into an option agreement for a farm-in by Total on the Guyana acreage.
In January 2016, Eco Atlantic signed a Petroleum Agreement and is party to an Offshore Petroleum Licence with the Government of Guyana and Tullow Oil for the Orinduik Block offshore Guyana.
Eco has a 40% working interest and Tullow Oil has a 60% working interest. Tullow Oil, as the operator, will pay Eco Atlantic US$400,000 and fully carry Eco Atlantic for approximately CAN $3M of the 2D and 3D survey for an initial four years work commitment.
In September 2017, Eco Atlantic announced that its subsidiary, Eco Atlantic (Guyana) Inc. entered into an option agreement on its Orinduik Block with Total E&P Activités Pétrolières, a wholly owned subsidiary of Total SA.
Pursuant to the option, Total paid an option fee of US$1M, at its sole discretion, to Farm-in to the Orinduik Block for an additional payment in cash of US$12,5M to earn the 25% Working Interest.
The exercise of the Option must be made within 120 days of completion of processing of the 3D seismic. The survey acquisition was completed on September 5 and processing is expected to take two to three months.

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Canadian company joins hunt for oil close to ExxonMobil’s ‘Liza’ discovery

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