Africa Oil will no longer be a shareholder in Eco. Credit: Who is Danny via Shutterstock.
Canada-based oil and gas exploration company Eco Atlantic Oil and Gas (Eco) has signed a share cancellation deal with Africa Oil SA Corporation (AOSAC).
Operating through its wholly owned subsidiary, Azinam, Eco has agreed to sell and assign a 1% participating interest in South Africa’s offshore Block 3B/4B to AOSAC in exchange for the cancellation of all common shares in Eco and warrants over common shares held by Africa Oil.
The deal, announced via a public statement on Monday (29 July), includes the associated exploration right and joint operating agreement rights.
No additional rights in the rest of Eco’s portfolio assets in Guyana, Namibia or South Africa are part of the agreement.
Africa Oil currently holds 54,941,744 common shares and 4,864,865 warrants, a financial instrument that gives the holder the right to purchase or sell shares at a set price.
If the warrants were converted the two amounts would equal 16.16% on a diluted basis of the total outstanding common shares of Eco, currently worth approximately C$11m ($8m).
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Once completed, the statement revealed, Azinam will allot the assigned interest to AOSAC – and in return Africa Oil will transfer the common shares and warrants for immediate cancellation.
Finally, Eco will hold a fully carried 5.25% interest in Block 3B/4B Offshore South Africa, reduced from the current 6.25%, while Africa Oil will no longer be a shareholder in Eco or be able to appoint a director to its board.
As part of the transaction, Africa Oil has also entered into a lock-up agreement, under which it is restricted from trading, transferring, mortgaging or dealing in any of Eco’s shares or warrants until the conclusion of the agreement.
“We are pleased to continue working with Eco Atlantic to close this transaction and to drill the first exploration well on Block 3B/4B, targeting substantial prospectivity in the Orange Basin, offshore South Africa,” said Roger Tucker, president and CEO, Africa Oil.
The transaction is subject to conditions and regulatory approvals from the South African Government, TSX Venture Exchange, applicable Canadian Securities Commissions and the Block 3B/4B joint venture partners.
Eco CEO and co-founder Gil Holzman stated: “We continue our focus on conducting exploration campaigns in global hydrocarbon hotspots such as the Orange basin in South Africa, the Walvis basin in Namibia and in Guyana.”
Eco’s operations are focused on the offshore Atlantic Margins in South Africa, Namibia and Guyana.
In Guyana, the company is managing an active farmout process for the offshore Orinduik Block. In Namibia, a multi-block farmout process is under way for all or part of Eco’s four offshore petroleum exploration licences.
According to Offshore Technology’s parent company, GlobalData, mineral fuels and oils and products of their distillation are the second-biggest commodity exports and imports in South Africa’s economy.
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Source link : https://www.offshore-technology.com/news/eco-atlantic-oil-and-gas-signs-share-cancellation-deal-with-africa-oil/
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Publish date : 2024-07-30 14:52:58
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