Value the markets article17 Sep 2018 13:43
Comments from Gil :
"Every time ExxonMobil discovers something nearby, it de-risks us, but this was particularly material, positively mitigating both reservoir and migration principal risks. Although the discovery is on their licence, the underlying geology extends into our field. For all intents and purposes, this means that without even drilling yet we have a nearby discovery. This makes the corresponding area on our acreage a major candidate for our first well. One important aspect to note is that the CPR still didn’t include the data and substantial implications from Hammerhead-1 discovery. Once the partners continue their seismic evaluations, we can only expect a big jump in resource potential and probability of success."
On Namibia
Holzman says this external activity will give Eco a better understanding of the oil systems in its own blocks: ‘If Tullow’s well is a success or has oil shows, then it has very positive implications for our assets. Indeed they could become subject to enhanced drilling programmes and farm-in activity from majors such as Exxon and Total, who are currently taking positions in the Basin and sitting on the sidelines. If the well is not successful, then there will be a subsequent well drilled at Prospect S, which could also have a similar effect on our assets. I believe Tullow will yield a moderate discovery that will generate additional exploration activity."
Moving forward
"We think our existing model of going into a prospective oil basin in a somewhat under-explored area, negotiating directly with the government and taking a large stake before partnering with firms somewhere down the road can be applied more broadly. At the moment, we are busy looking at least two additional opportunities."
"Africa Oil Corp is a very large company that wants to work with us to identify new opportunities. This is great for us because it gives us the guidance and support of a huge, experienced player in the market while also meaning we do not necessarily have to go out and raise money in the market to fund any potential acquisitions we may identify."
"‘In many ways, Guyana is our value generation asset, and it will be huge, we calculate that it is at least $600m net to us on risked basis (unrisked – $2bn). Namibia will be a bonus and Tullow has just spudded a well a week ago. We are currently trading with a market cap of £80; this will easily go much, much higher than that next year once we have made a drilling decision.’
http://www.valuethemarkets.com/index.php/2018/09/17/eco-atlantic-shares-soar-major-guyana-discovery-total-tie-can-momentum-continue-eco/
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