Eco (Atlantic) Oil & Gas has completed the farm-down of 60% participating interests in three Namibia’s offshore exploration licenses to BP, transferring operatorship of the blocks and clearing the way for a new seismic exploration program.
The transaction covers Block 2012A under PEL97 (Cooper), Blocks 2111B and 2211A under PEL99 (Guy), and Blocks 2211B and 2311A under PEL100 (Tamar), Eco announced following the final ministerial approvals received on November 9.
Completion follows the receipt of Section 11 consent from the Namibian government on October 1 and the subsequent ministerial signing of transfer, assignment and license renewal deeds.
Under the agreement, BP Namibia Energy holds a 60% operating interest in each license, while Eco retains 25%, NAMCOR holds 10% and local partners retain the remaining 5%.
Eco will receive a one-time cash payment of $2.7 million on November 16, while BP will fully carry Eco's retained 25% interest and its proportionate share of the NAMCOR and local partners' interests during the first renewal exploration period.
The government-approved work program includes seismic reprocessing on PEL97 and the acquisition of at least 3,000 square kilometers of new 3D seismic data across PEL99 and PEL100.
Preparations are underway for the acquisition campaign, which is expected to begin in the coming weeks.
If BP and its partners elect to enter the second renewal period in 2028 and commit to drilling an exploration well, Eco can transfer a further 10% interest to BP in exchange for a full carry on its remaining 15% stake.
That arrangement would be capped at $21 million net to Eco for each well on each license, with a maximum aggregate carry of $63 million if the options are exercised across all three licenses.
Alternatively, Eco can retain its 25% interest and fund its share of drilling costs, with the option to seek other farm-out partners.
Eco intends to use the transaction's cash proceeds to support exploration and appraisal activities across its Atlantic Margin portfolio and for general working capital.
The transaction has received conditional acceptance from the TSX Venture Exchange, with final acceptance pending the filing of customary closing documentation.