Eco (Atlantic) Oil & Gas Ltd. through its subsidiary, Eco (Atlantic) Guyana Inc. has been issued an interest in a Petroleum Prospecting License over the new Orinduik Block, offshore the Co-Operative Republic of Guyana. The Company further announces that it has entered into a Petroleum Agreement with the Government of Guyana and Tullow Guyana BV, a subsidiary of Tullow Oil plc., through which Eco Atlantic will hold a 40% working interest in the Block and Tullow, as Operator, will hold the remaining 60% working interest. Tullow will reimburse Eco Atlantic for part of its costs in relation to the application of the Block license and will partially carry Eco Guyana for the future 3D program.
In total, the license term of the Exploration Period is for 10 years. The decision to drill and to complete the first exploration well must occur within the first renewal period in years five and six.
The Block is located in the Suriname Guyana basin in shallow waters and is located close to Exxon Mobil Corporation’s recently announced “Liza” discovery (the “Exxon Discovery”). Exxon Mobil announced in May 2015 that the Exxon Discovery well encountered more than 90 meters of high-quality oil-bearing sandstone reservoirs. The well was safely drilled to 5,433 meters in 1,743 meters of water. In July 2015, Bloomberg published an article quoting a Guyana minister as saying the discovery probably holds the equivalent of more than 700 million barrels of oil. Wood MacKenzie has called this discovery one of Latin America’s most exciting exploration developments.
Colin Kinley, COO and Director of Eco Atlantic commented: “We very much appreciate the award of the Orinduik Block license by the Government of Guyana and the signing of the Petroleum Agreement. We have worked diligently for the last 18 months on this initiative and are very encouraged by the Liza discovery at Exxon’s Stabroek block, located only a few kilometers away. Tullow has been very active regionally for a number of years and has had good success in developing a proven model of the basin. Tullow, a leader in this type of frontier basin development, is our good partner in Namibia as well as our neighbor in Ghana. We are both advanced in our understanding of the Block, share a common objective and we are pleased to have them as the operating partners in Guyana.”
Gil Holzman, President and CEO of Eco Atlantic commented: “We are delighted and thankful to the Guyana government for awarding Eco Guyana this new block situated in the proven hydrocarbon system, offshore Guyana. This block and JV with Tullow is consistent with our strategy of accessing high potential petroleum systems in politically stable jurisdictions on cost effective terms. The Orinduik Block in Guyana has a long license life and we are in partnership with a technically and financially robust partner - well experienced alongside Eco Atlantic, in the international exploration and production space.”
Holzman continues: “I am especially proud that we are repeatedly demonstrating our ability to negotiate our way into highly prospective assets on favorable commercial terms in this challenging market. With our recent acquisition in Ghana, our advanced work in Namibia and now this new block in Guyana awarded for 10 years, we are well positioned as an international explorer with a particular focus offshore the Atlantic margin.”