Eco (Atlantic) Oil & Gas Ltd., incorporated in the British Virgin Islands, has signed a definitive Farm-out Agreement with Bermuda-based Azimuth Ltd.
Azimuth is an exploration and production company backed by majority-owner Seacrest Capital Ltd. and Petroleum Geo-Services ASA. Pursuant to the agreement, Azimuth will earn 20% working interest in each of Eco Atlantic's offshore Namibia licenses, namely the “Cooper License”, the “Sharon License” and the “Guy License”, in return for funding 40% of the cost of 3D seismic surveys across all three licenses, the acquisition of which is expected to cost more than US$25 million.
The BVI company, through its wholly owned subsidiary Eco Oil and Gas Namibia (PTY) Ltd., currently holds 90% working interest in the licenses, and the Namibian National Oil and Gas Company (NAMCOR) holds a 10% working interest. As a result of this transaction, Eco Namibia's interest will be 70%, Azimuth will earn 20 % interest, and NAMCOR will retain its 10% carried interest.
Gil Holzman, President and CEO of Eco Atlantic, commented on the transaction, saying: “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.”
