ECO (Atlantic) Oil and Gas Ltd. is forging ahead with its plans to drill at least two additional exploration wells offshore Guyana in 2021, even as multiple other prospects are being reviewed for the upcoming drilling programme, and all finances necessary are in place.

The oil-and-gas exploration company presented this information on Monday in its audited results for the Year Ended March 31, 2020 and Business Update.

“Multiple prospects are currently being reviewed with high-graded candidates under consideration for the next drilling programme. Eco is fully funded for a further drilling programme on the Orinduik Block, and plans, subject to JV Partner approval, to drill at least two exploration wells into light oil cretaceous targets in 2021,” the Company says in its report.

The company has a 15 per cent working interest in the Orinduik Block offshore Guyana, and gave all assurance back in April 2020 that despite its implemented cost-cutting measures due to the COVID-19 pandemic, it’s still in “a robust position” to continue its exploration work in Guyana.

Eco Atlantic had initially planned its drilling programme for 2020, but Company President and Chief Executive Officer Gil Holzman disclosed in February 2020 that the need to better understand the geology of the Orinduik Block offshore Guyana would likely push the drilling programme into 2021.

Thus far, 22 prospects have been identified in the Orinduik Block, including 11 leads in the Upper Cretaceous horizon.

“Following the 2019 drilling campaign,“we are now working closely with our JV Partners to incorporate learnings from these and other nearby discoveries to determine our next drilling targets planned for 2021. We are keen to resume drilling activity on the Orinduik licence as soon as is practically possible, and we look forward to updating the market as we finalise our plans for next year,” Holzman said on Monday in the Business Update, adding:

“We have some of the most attractive acreage positions in two of the most exciting global regions for oil and gas exploration activity, a very strong block partners in Guyana and on the corporate level, and we are well funded to ramp up activity in both jurisdictions as well as other regional opportunities.”

FURTHER ANALYSIS

According to the update, in Q1 2020, the Orinduik Block’s operator, Tullow, proposed a further fine-tuning analysis of the Upper Cretaceous reservoirs and announced a plan to incorporate the Kanuku Block’s Carapa-1 well data into Orinduik’s existing geological models and technical analysis.

In 2019, Tullow made the Jethro-1 discovery, which comprised of high- quality oil-bearing sandstone, and a 55m reservoir of Lower Tertiary age drilled with a net cost to Eco of US$7.6M.

That same year, the Joe-1 discovery took place, comprising high-quality oil-bearing sandstone of 16m reservoir with a high porosity of Upper Tertiary age. It was drilled with a net cost to Eco of US$3M.

The two finds were mobile heavy crudes with high sulphur content, which appeared similar to the commercial heavy crudes in the nearby Hammerhead discovery.

In January 2020, a discovery was made at Carapa-1, but the find was below the company’s pre-drill estimate.

In its Q1 report, Eco Atlantic noted that its Joint Venture (JV) partners have approved their 2020 budget, and are integrating the discoveries of Jethro-1, Joe-1 and Carapa-1 with the rest of the regional data now available.

This data will be incorporated into a reprocessing of the 3D seismic already shot on Orinduik. The intent is to provide further definition to the Cretaceous interpretation and target selection for drilling.

Eco Atlantic added: “Geological modeling and prospects maturation on the Orinduik Block are ongoing, which is anticipated to provide further definition to the Cretaceous interpretation and targets’ selection for drilling by the end of the calendar year.”

Despite the COVID-19 challenges, the country has been performing well, as at March 31, 2020, the Company had cash and cash equivalents of CAD $26,482,896 million (US$18,782,196) with zero debt and remains fully funded for its share of further appraisal and exploration drilling at Orinduik Block offshore Guyana (the “Orinduik Block”) of up to US$120M (gross).

As at March 31, 2020, Eco had total assets of CAD $28,205,351 million (US$ 20,003,795), total liabilities of CAD $496,889 (US$ 333,255) million and total equity of CAD $27,708,462 million (US$ 19,651,392).

Holzman stated: “We continue to monitor our costs closely and given we have met all of our existing work commitments in Guyana… for 2020, we only expect to incur minimal costs for the remainder of the year, thus we expect to end the 2020 calendar year with approximately US$17M in cash.”