Set to exploration catalysts as it brings Total into Guyana venture
Eco Atlantic Oil & Gas Ltd has significantly boosted its position offshore Guyana with a new deal potentially adding another blue-chip oiler to the Orinduik exploration project.
It has landed a potential new tie-up with French major Total, putting itself in the kind of sweet spot that most investors could hope for.
Total joins Tullow, operator with a 60% stake, and Eco should have cash to cover its share of a potentially transformational exploration programmes.
Importantly, holding 15% it will retain a material but manageable equity stake in the project which is in what is becoming a high profile exploration frontier.
The project is located in an area that has already been substantially de-risked by world-class successes. In the neighbourhood, Exxon has discovered some 2.25bn to 2.75bn barrels of crude, and plans to start production from the Liza field in 2020.
Total is paying US$1mln to Eco in order to secure an option for a 25% stake in the asset, which it can exercise for an additional payment of US$12.5mln.
The option is exercisable up to 30 days following the completion of the new 3D seismic data being processed and interpreted – it is expected to take 2-3 months from the end of the programme (September 5).
Eco will retain 15% of Orinduik alongside Tullow with 60% and Total with 25%.