WTI (May)$96.57 -$1.30, Brent (June) $95.20 -72c, Diff +$1.37 -58c
USNG (May) $2.65 -2c, UKNG (May) 126.9p +14.52p, TTF (May) €46.93 +€1.755

Oil price

Last week oil fell sharply, WTI was down $15.84 and Brent fell by $14.07 but with the news over the weekend a rally has happened, both are up around $8 this morning.

The news I refer to is that of the failed peace talks where both sides showed total intransigence and with the US demanding the Strait of Hormuz being opened and Iran refusing to give up its nuclear options ‘irreconcilable differences’ were cited as the reasons. 

After that President Trump declared that the USA would close the Strait which caused the price of oil to rise. Now, as I see it I think that he means that it is closed to Iranian or pro-Iranian ships whilst intending allies to use it. Easier said than done you might say and rightly so but here the position of China comes into the equation. They buy most of Iran’s oil and allegedly supply arms in return, could this be a rather smart way for the Donald to have a lever to use ahead of his visit to the far east next month? 

And one other thing, the FT ran a story that Kpler, the industry consultant has noted that empty tankers headed to the USA loading ports are up threefold in the last six weeks, as suggested by himself buyers are turning to WTI which also partly explains why it has gone to a premium against Brent recently. 

Eco (Atlantic) Oil & Gas

Eco has announced that it has signed an agreement to farm down 60% Participating interest in all three of its Petroleum Exploration Licenses offshore Namibia to BP Namibia Energy Ltd, a wholly owned subsidiary of BP Exploration Operating Company Limited.  

The Farmout Agreement, signed on 10 April 2026, pursuant to which wholly owned subsidiaries of Eco: Azinam Group Limited, Eco Oil & Gas Namibia (Proprietary) Limited (“Eco Namibia”) and Eco Oil & Gas Services (Proprietary) Limited (“Eco Services”) will farm out an aggregate of 60% Participating Interest and transfer Operatorship to BP in respect of the Block 2012A PEL97 (“Cooper License”), Blocks 2111B and 2211A PEL99 (“Guy License”) and Blocks 2211B and 2311A PEL100 (“Tamar License”) (the “Transaction”).  

Upon successful completion of the Transaction, Eco through its wholly owned subsidiaries Eco Namibia and Eco Services will retain a 25% interest in PEL97, PEL99 and PEL100 (“Eco’s 25% Retained PI”). Completion of the Transaction is subject to customary conditions and approvals from the Namibian authorities, Ministry of Industries Mines and Energy and Upstream Petroleum Unit at the State House.

Transactions Highlights:

• A one time cash consideration of US$2.7 million payable at Transaction completion.
• BP will carry 100% of Eco’s 25% Retained PI as well as Eco’s proportionate share of the NAMCOR (10%) and the Local Partners (5%) PI Carry on PEL97, PEL99 and PEL100 against the current exploration phase. 
• The proposed exploration work program (which is subject to requisite government approval), includes; completing seismic reprocessing on PEL97 and carrying out a 3D Seismic Survey of at least 3,000km2 on PEL99 and PEL100.
• If BP and partners elect to enter the Second Renewal Period of the license term in 2028 and commit to drilling an exploration well, Eco will have the option to either (i) exercise a Put Option to transfer an additional 10% PI to BP in exchange for a full carry on Eco’s remaining 15% PI subject to a cap of $21 million net to Eco for each well on each of the licenses (PEL97, PEL99, and PEL100); or (ii) elect to retain its 25% PI of the costs associated with such drilling of a well during the Second Renewal Period.
• The maximum aggregate Carry consideration payable by BP in respect of each Put Option (should all Put Options namely on PEL97, PEL99, and PEL100 be exercised) is US$63 million with a cap of US$21 million per Put Option.
• Eco can elect to retain its 25% paying interest and/or to farm out to other potential partners (subject to such partners meeting technical and financial qualifications).
• The Transaction is subject to all customary approvals being obtained from the Government of Namibia in relation to the transfer of PI and transfer of Operatorship to BP and acceptance by the TSXV. 
• The Transaction constitutes an arm’s length transaction for purposes of TSXV policies. No finder’s fees are payable in connection with the Transaction.  No insiders of the Company have any interest in the Transaction.

Gil Holzman, President and Chief Executive Officer of Eco Atlantic, commented:
“This successful farm down of our Namibian Walvis Basin Licenses marks an incredible moment for Namibia, for Eco Atlantic and its shareholders.  This transaction is a clear demonstration of our strategy partnering with Supermajors and IOC’s, to derisk our portfolio while retaining material exposure to significant upside potential with very limited financial requirements from Eco.  Eco entered Namibia in 2011, with a firm belief of the Walvis basin subsurface potential, and we are proud to attract an IOC of BP’s calibre to further explore this prospective basin.  We look forward to continuing our excellent working relationship with BP’s dynamic and experienced team and welcome them to the Land of the Brave.”

“I am extremely grateful to our Namibia country manager, Tironenn Kauluma, as well as my dedicated team and our legal advisors at Cliffe Dekker Hofmeyr, for their tireless efforts over the past few months in delivering this monumental transaction for Eco shareholders and our Namibian Stakeholders. We are also deeply appreciative of the ongoing support, guidance and cooperation we always have from the Petroleum Commissioner at the Ministry of Mines and Energy, her team, and the Upstream Petroleum Unit at the state house.”

“In parallel Eco has been progressing closing of the JHI Acquisition, and Eco and Navitas continue advanced discussions with the Government of Guyana regarding appraisal and exploration activities on the Orinduik block, while progressing lead and prospect evaluation on Block 1 CBK in South Africa’s Orange basin. We will provide market updates as further developments arise within our broader Atlantic margin portfolio.”

Having watched the Eco story over the years, the farm-out of the Walvis Basin interests in Namibia to me represents an important part of this exciting part of the portfolio and yet again proves that Eco has the right, patient long term approach to its asset base.

The three licences, PEL’s 97,99 and 100 have been framed-out to BP who will take 60% of each and operatorship leaving Eco with 25%. Importantly Eco receive a $2.7m cash consideration plus BP undertaking a work programme that will include seismic work on all three blocks.

In addition, when the time for extension comes up in 2028, should BP decide to continue with an exploration well Eco gets the option to either transfer another 10% to them in return for a full carry or to keep the existing 25% and therefore itself fund its share of costs associated with a well in the 2nd renewal period. In this scenario Eco would be able to decide if it wanted to farm-out any of this remaining stake to other potential partners.

This is indeed very good news for Eco and it makes the entire portfolio properly sorted with ‘solid’ partners who are all committed to taking, and by inference financing, work going forward. In the Falklands and in Guyana their partners are Navitas, in South Africa TotalEnergies and Qatar Petroleum and now in Namibia they have tempted BP to join them. 

CEO Gil Holzman says that ‘this transaction is a clear demonstration of our strategy partnering with Supermajors and IOC’s, to derisk our portfolio while retaining material exposure to significant upside potential with very limited financial requirements from Eco’.  A highly credible achievement that even I may not have predicted all those years ago but one that shows quite how well the company is now placed for the future. 

This is another truly exceptional deal by Eco and one which its shareholders will be incredibly happy with. My faith in the company obviously remains 100% intact and of course it will remain in the Bucket List despite already having performed well, up another 10% today after a rise of 692% on six months and +677% over a year.

At the moment my target price of 150p will stay, once that looked somewhat high wide and handsome, only now I am thinking that it may need tweaking should anything start to come in.

It should also be noted that this has knock-on effects for others, I am very interested that this has been done as the first deal by BP under new management, it shows that they have for once and for all returned to its grass roots of being an E&P business, also that Chevron is gearing up to drill in the centre of the Walvis Basin in PEL82 just east of where Eco is located.

Original article   l   KeyFacts Energy Industry Directory: Malcy's Blog