Eco Atlantic Oil & Gas Ltd (LON:ECO, CVE:EOG) told investors it is fully funded and it is pushing for its joint venture partners to commit to at least one new cretaceous exploration well as soon as practically possible.
The cretaceous play is the most prominent in the region, in terms of successes, with Exxon’s nearby multi-billion barrel Stabroek discoveries along with Repsol’s separate Carapa discovery which was recently made on a neighbouring licence block.
But, whilst two discoveries were made in Eco’s Orinduik exploration area last year neither were in this play – and, both ultimately disappointed after initial excitement as they turned out to contain ‘heavy’ oil.
Multiple cretaceous exploration targets are presently being reviewed and ‘high graded’ for consideration to the next phase of drilling at Orinduik.
The timing for this envisaged programme will depend largely on the pace that ongoing analysis work is completed and the appetite among Eco’s partners to spend on new exploration.
Project operator Tullow Oil PLC (LON:TLW) last year put its entire business and portfolio under review amid management changes and changing priorities – to put focus on debt reduction and reduce capex outgoings.
Tullow holds 60% of the Orinduik asset, alongside Total with 25% and Eco with 15%.
Earlier this month, Total chief executive Patrick Pouyanne was quoted in the media saying that he expected two or three new wells to be drilled offshore Guyana this year
Similarly, Eco previously aimed for a 2020 drill programme but today chief executive Gil Holzman flagged that the campaign may now slip back into next year’s docket.
"While it is Eco's intention, and there remains the potential, to conduct a drilling program later this year, the need to integrate the new data learned from recent discoveries in the region into our understanding of the Block's geology may result in further drilling and appraisal activity taking place in H1 2021,” Holzman said.
“However, a final decision on further drilling activity and the overall budget will be made in the coming months.”
Holzman added: “After completing a successful drilling campaign in 2019, we continue to benefit from a very strong balance sheet and remain fully funded to conduct further exploration and appraisal drilling activity on the Orinduik Block.
“Our recently updated CPR reaffirms the high prospectivity of the license and the considerable upside potential contained within the Tertiary and Cretaceous horizons.
“As such, the JV partners are working on incorporating the learnings gained from other regional discoveries, such as the Carapa well result, into our existing geological models, as this will enable us to identify the most high value targets on the block.”
The Eco boss emphasised that the company remained convinced that Orinduik has “significant upside”.
The company is “well funded, has strong shareholders and partners, and is confident that further drilling activity will be conducted as soon as practically possible and will prove the Block's potential," he added.
The pre-revenue exploration firm, in today’s financial results statement for 2019, reported a US$3.25mln net loss.
It ended December with US$25.36mln of cash and cash equivalents.