Eco (Atlantic) Oil & Gas' $10.5mln deal "has a broad effect without diluting shareholders"
London, UK
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July 19, 2023 10:09 AM Eastern Daylight Time
Eco (Atlantic) Oil & Gas Ltd CEO Gil Holtzman speaks to Thomas Warner from Proactive London following the news that the exploration company has agreed a deal to sell a partial stake (6.25%) in the Block 3B/4B asset offshore South Africa for US$10.5mln.
Buyer Africa Oil will pay in cash, split across multiple tranches tied to project milestones. It initially gets US$2.5mln following the signing of the sales agreement, then US$2.5mln is due once the government approves the deal. After that, US$4mln will be due if/when Africa Oil farms out a stake and US$1.5mln comes due when the project’s first well is spudded.
A joint farm-out process continues with the aim of bringing in a new partner that could take up to 55% of the project. Holtzman explains the rationale for the transaction, which he suggests is part of a broader plan that will become clearer as the summer goes on.
"There's not too much I can say... but pay close attention and have a look at our announcement(s) in the coming few months and that will basically paint the bigger picture that we're working on." Holtzman says that the strategic move has so far received positive feedback from "sophisticated investors... who understand the rationale and what it entails for company going forward."
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