Half Yearly Report
PetroNeft Resources plc
("PetroNeft" or the "Company")
2014 Interim Results
PetroNeft Resources plc (AIM: PTR) owner and operator of Licences 61 and 67, Tomsk Oblast, Russian Federation, is pleased to report its results for the 6 months ended 30 June 2014.
Highlights:
· H1 production average of 2,163 bopd.
· Farmout of Licence 61 to Oil India completed, Company is now debt-free.
· Drilling underway at Tungolskoye and Arbuzovskoye.
David Golder, Chairman of PetroNeft Resources plc, commented:
"The first half of 2014 was a turning point for the Company. The farmout of Licence 61 was agreed with Oil India which lead to the repayment of all debt and the re-commencement of drilling at Licence 61.
Drilling is now underway at both Tungolskoye and Arbuzovskoye and I look forward to providing further updates on these activities in the near future."
For further information, contact:
|
Dennis Francis, CEO, PetroNeft Resources plc |
+1 713 988 2500 |
|
Paul Dowling, CFO, PetroNeft Resources plc |
+353 1 647 0280 |
|
John Frain/Brian Garrahy, Davy (NOMAD and Joint Broker) |
+353 1 679 6363 |
|
Henry Fitzgerald-O'Connor, Canaccord Genuity Limited (Joint Broker) |
+44 207 523 8000 |
|
Martin Jackson/Shabnam Bashir, Citigate Dewe Rogerson |
+44 207 638 9571 |
|
Joe Murray/Joe Heron, Murray Consultants |
+353 1 498 0300 |
PetroNeft Resources Plc
Unaudited interim condensed
consolidated financial statements
For the 6 months ended 30 June 2014
Unaudited interim condensed consolidated financial statements
Table of Contents Page
Group information 3
Chairman's Statement 5
Interim Consolidated Income Statement 8
Interim Consolidated Statement of Comprehensive Income 8
Interim Consolidated Statement of Financial Position 9
Interim Consolidated Statement of Changes in Equity 10
Interim Consolidated Cash Flow Statement 11
Notes to the Financial Statements 12
Forward Looking Statements
This report contains forward-looking statements. These statements relate to the Group's future prospects, developments and business strategies. Forward-looking statements are identified by their use of terms and phrases such as 'believe', 'could', 'envisage', 'potential', 'estimate', 'expect', 'may', 'will' or the negative of those, variations or comparable expressions, including references to assumptions.
The forward-looking statements in this report are based on current expectations and are subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied by those statements. These forward-looking statements speak only as at the date of these financial statements.
Directors David Golder (U.S. citizen)
(Non-Executive Chairman)
Dennis Francis (U.S. citizen)
(Chief Executive Officer)
Paul Dowling
(Chief Financial Officer)
David Sanders (U.S. citizen)
(General Legal Counsel)
Gerard Fagan
(Non-Executive Director)
Thomas Hickey
(Non-Executive Director)
Vakha Sobraliev (Russian citizen)
(Non-Executive Director)
Registered Office and Business Address 20 Holles Street
Dublin 2
Ireland
Secretary David Sanders
Auditor Ernst & Young
Chartered Accountants
Harcourt Centre
Harcourt Street
Dublin 2
Ireland
Nominated and ESM Adviser Davy
49 Dawson Street
Dublin 2
Ireland
Joint Brokers Davy Canaccord Genuity
49 Dawson Street 88 Wood Street
Dublin 2 London
Ireland EC2V 7QR
United Kingdom
Principal Bankers KBC Bank Ireland AIB Bank
Sandwith Street 1 Lower Baggot Street
Dublin 2 Dublin 2
Ireland Ireland
Solicitors Eversheds
One Earlsfort Centre
Earlsfort Terrace
Dublin 2
Ireland
White & Case
5 Old Broad Street 4 Romanov Pereulok
London 125009
EC2N 1DW Moscow
United Kingdom Russia
Registered Number 408101
Registrar Computershare
Heron House
Corrig Road
Sandyford Industrial Estate
Dublin 18
Ireland
Dear Shareholder,
I am pleased to report on the activities of the Group for the six months to 30 June 2014 and provide an update on recent progress.
Production and Sales
Production in the six months to 30 June 2014 averaged 2,163 bopd, a 12% decrease compared to the same period in 2013 (2,464 bopd) The decrease was as a result of natural decline and the fact that no new production wells have been drilled since February 2013. We sold 391,379 barrels of oil in the six months to 30 June 2014 (H1 2013: 438,350 bbls) and achieved an average oil price of $44.79 (H1 2013: $42.48).
Licence 61 Farmout
On 17 April 2014 the Company signed a binding contract with Oil India Limited (OIL) to farmout a 50% non-operated interest in Licence 61. Following shareholder approval in May 2014 and the granting of Russian Regulatory Approval on 30 June 2014 the transaction was completed on 3 July 2014. All debt due to Macquarie and Arawak was subsequently repaid from the initial proceeds of US$35 million and the Company is now debt-free.
Under the terms of the Licence 61 Farmout, OIL acquired a 50% non-operated interest in Licence 61 in return for a total Investment of up to US$ 85 million consisting of:
· US$35 million upfront cash payment, enabling PetroNeft to repay in full its debt due to Macquarie and Arawak,
· US$45 million of committed exploration and development expenditure on Licence 61 and
· US$5 million performance bonus, contingent upon average production from the Sibkrayevskoye Field reaching 7,500 bopd within the next 5 years.
Since completion in July 2014, the Joint Venture Working Group made up of OIL and PetroNeft has been formally established and the major work programme and budget items for 2014 and 2015 agreed. Under the terms of the Licence 61 Farmout Agreement, OIL will fund the following work programme from the US$45 million of committed exploration and development expenditures on Licence 61.
Tungolskoye No. 5 delineation well
This well, the first horizontal well to be drilled on Licence 61, was spudded at the end of August 2014. The well will include a vertical pilot hole followed by a horizontal segment in the reservoir. It is planned to core, test and log the J-1 reservoir in the vertical hole before drilling and testing the horizontal section. The data obtained will be used to finalise the pilot development plan to develop the field and tie-back to the Lineynoye processing facilities. The pilot hole is currently drilling ahead at a depth of 2,500 m. The entire well will take an estimated 60 days to drill and complete. Assuming a successful result, additional horizontal and vertical wells will be drilled at Tungolskoye during 2015 and a pipeline will be constructed to the Lineynoye Central Processing Facility.
Arbuzovskoye development wells
A minimum of three additional development wells will be drilled at Arbuzovskoye Pad 1. A second drilling crew has been mobilised to the field to drill these wells and drilling of the Arbuzovskoye 106 well in the north eastern area of the field has commenced.
Sibkrayevskoye
The Sibkrayevskoye No. 373 delineation well will be drilled following completion of the Tungolskoye No. 5 well. Data from this well along with new seismic data will allow for the development of Sibkrayevskoye starting in 2016. The drilling rig for this well is on location and assembly will commence in October in preparation for drilling which is expected to commence early in 2015.
Licence 61 Seismic
Acquisition of 1,000 line kms of high resolution 2D seismic data has been approved. This programme is designed to detail the Sibkrayevskoye oil field and large Emtorskaya High where potential by-passed oil has been identified in two wells drilled in the 1970's. It will also further detail three significant leads in the Northern portion of the Licence area. The seismic crew has already mobilised to the field for surveying and line clearing operations. The data acquisition will occur primarily in Q1 2015 with results due in late summer 2015.
Equity raise
In March 2014 the Company undertook a share issue raising approximately US$5 million net of costs through the issue of 62,325,631 new shares. This enabled PetroNeft to purchase the materials and supplies necessary for the 2014 work programme which were mobilised to the field while winter roads were still in place.
Licence 67
In the first half of 2014 we undertook a 3D seismic programme at Licence 67 to acquire 163 km2 of high quality 3D seismic data at the Ledovoye and Cheremshanskoye oil fields on Licence 67. The data is currently being processed and interpreted and we expect to have the final data package by the end of 2014. This will guide our future plans for Licence 67.
Financial results for the period
The net loss after tax for the period was US$2,728,794 (H1 2013: US$10,593,368). The loss includes a foreign exchange loss of US$2,060,685 (H1 2013: US$6,376,921) on loans denominated in US Dollars and Russian Roubles from PetroNeft to its Russian subsidiaries Stimul-T and Granite Construction whose functional currency is the Russian Rouble. In accordance with IFRS 5, there was no depreciation charge in the period relating to assets held for sale leading to a reduction of US$2,652,966 in the total depreciation charge as compared to the same period in 2013.
|
Financial Highlights |
|
|
Unaudited |
|
Audited |
||
|
|
|
|
6 months ended 30 June 2014 |
|
6 months ended 30 June 2013 |
|
Year ended 31 December 2013 |
|
|
|
|
US$ |
|
US$ |
|
US$ |
|
Revenue |
|
|
17,527,910 |
|
18,624,293 |
|
38,687,123 |
|
Cost of sales |
|
|
(13,383,948) |
|
(16,683,461) |
|
(33,551,965) |
|
Gross profit |
|
|
4,143,962 |
|
1,940,832 |
|
5,135,158 |
|
Gross margin |
|
|
24% |
|
10% |
|
13% |
|
|
|
|
|
|
|
|
|
|
Administrative expenses |
|
|
|
|
|
|
|
|
Overheads |
|
|
(3,188,146) |
|
(3,386,091) |
|
(6,587,732) |
|
Share-based payment credit/(expense) |
|
|
11,861 |
|
(247,549) |
|
(418,775) |
|
Other foreign exchange loss |
|
|
54,067 |
|
217,634 |
|
166,537 |
|
|
|
|
(3,122,218) |
|
(3,416,006) |
|
(6,839,970) |
|
Foreign exchange loss on intra-Group loans |
|
|
(2,060,685) |
|
(6,376,921) |
|
(6,189,735) |
|
Finance costs |
|
|
(1,575,918) |
|
(1,751,751) |
|
(3,437,088) |
|
Loss for the period before taxation |
|
|
(2,709,230) |
|
(9,721,822) |
|
(11,495,885) |
|
Income tax (expense) / credit |
|
|
(19,564) |
|
(871,546) |
|
2,337,159 |
|
Loss for the period attributable to equity holders of the Parent |
|
|
(2,728,794) |
|
(10,593,368) |
|
(9,158,726) |
|
Capital expenditure in the period |
|
|
3,002,029 |
|
3,137,110 |
|
5,263,823 |
|
Net proceeds of equity share issues |
|
|
5,018,194 |
|
- |
|
- |
|
Bank and cash balance at period end (including restricted cash) |
|
|
4,082,923 |
|
4,130,720 |
|
2,171,778 |
|
Total debt at period end (undiscounted) |
|
|
28,900,000 |
|
33,900,000 |
|
30,000,000 |
Conclusion
The first half of 2014 was a turning point for the Company as we agreed the farmout with Oil India Limited allowing us to clear all our debts and to re-start the development of Licence 61. Since then we have agreed a work programme on Licence 61 with our new partner and recommenced drilling. I look forward to updating shareholders on our progress in the near future.
David Golder
Non-Executive Chairman
25 September 2014
|
Interim Consolidated Income Statement |
|
|
|
|
|
|
|
|
For the 6 months ended 30 June 2014 |
|
|
Unaudited |
|
Audited |
||
|
|
|
|
6 months ended 30 June 2014 |
|
6 months ended 30 June 2013 |
|
Year ended 31 December 2013 |
|
|
Note |
|
US$ |
|
US$ |
|
US$ |
|
|
|
|
|
|
|
|
|
|
Continuing operations |
|
|
|
|
|
|
|
|
Revenue |
|
|
17,527,910 |
|
18,624,293 |
|
38,687,123 |
|
Cost of sales |
|
|
(13,383,948) |
|
(16,683,461) |
|
(33,551,965) |
|
Gross profit |
|
|
4,143,962 |
|
1,940,832 |
|
5,135,158 |
|
|
|
|
|
|
|
|
|
|
Administrative expenses |
|
|
(3,122,218) |
|
(3,416,006) |
|
(6,839,970) |
|
Exchange loss on intra-Group loans |
|
|
(2,060,685) |
|
(6,376,921) |
|
(6,189,735) |
|
Operating loss |
|
|
(1,038,941) |
|
(7,852,095) |
|
(7,894,547) |
|
|
|
|
|
|
|
|
|
|
Share of joint venture's net loss |
11 |
|
(121,442) |
|
(127,267) |
|
(235,060) |
|
Finance revenue |
|
|
27,071 |
|
9,291 |
|
70,810 |
|
Finance costs |
5 |
|
(1,575,918) |
|
(1,751,751) |
|
(3,437,088) |
|
Loss for the period for continuing operations before taxation |
|
|
(2,709,230) |
|
(9,721,822) |
|
(11,495,885) |
|
|
|
|
|
|
|
|
|
|
Income tax (expense)/credit |
6 |
|
(19,564) |
|
(871,546) |
|
2,337,159 |
|
|
|
|
|
|
|
|
|
|
Loss for the period attributable to equity holders of the Parent |
|
|
(2,728,794) |
|
(10,593,368) |
|
(9,158,726) |
|
|
|
|
|
|
|
|
|
|
Loss per share attributable to ordinary equity holders of the Parent |
|
|
|
|
|
|
|
|
Basic and diluted - US dollar cent |
|
|
(0.39) |
|
(1.64) |
|
(1.42) |
|
|
|
|
|
|
|
|
|
|
Interim Consolidated Statement of Comprehensive Income |
|
|
|
||||
|
For the 6 months ended 30 June 2014 |
|
|
Unaudited |
|
Audited |
||
|
|
|
|
6 months ended 30 June 2014 |
|
6 months ended 30 June 2013 |
|
Year ended 31 December 2013 |
|
|
|
|
US$ |
|
US$ |
|
US$ |
|
Loss for the period attributable to equity holders of the Parent |
|
|
(2,728,794) |
|
(10,593,368) |
|
(9,158,726) |
|
Other comprehensive income to be reclassified to profit or loss in subsequent periods: |
|
|
|
|
|
|
|
|
Currency translation adjustments - subsidiaries |
|
|
(1,151,236) |
|
(3,141,622) |
|
(3,293,001) |
|
Currency translation adjustments - joint venture |
|
|
(94,778) |
|
(253,592) |
|
(252,238) |
|
|
|
|
|
|
|
|
|
|
Total comprehensive loss for the period attributable to equity holders of the Parent |
|
|
(3,974,808) |
|
(13,988,852) |
|
(12,703,965) |
|
Interim Consolidated Balance Sheet |
|
|
|
|
|
|
|
|
As at 30 June 2014 |
|
|
Unaudited |
|
Audited |
||
|
|
|
|
30 June 2014 |
|
30 June 2013 |
|
31 December 2013 |
|
|
Note |
|
US$ |
|
US$ |
|
US$ |
|
Assets |
|
|
|
|
|
|
|
|
Non-current Assets |
|
|
|
|
|
|
|
|
Oil and gas properties |
8 |
|
- |
|
97,483,831 |
|
- |
|
Property, plant and equipment |
9 |
|
374,149 |
|
1,464,430 |
|
467,060 |
|
Exploration and evaluation assets |
10 |
|
- |
|
26,282,372 |
|
- |
|
Equity-accounted investment in joint venture |
11 |
|
3,115,624 |
|
3,438,283 |
|
3,331,844 |
|
|
|
|
3,489,773 |
|
128,668,916 |
|
3,798,904 |
|
Current Assets |
|
|
|
|
|
|
|
|
Inventories |
12 |
|
27,480 |
|
1,811,156 |
|
30,523 |
|
Trade and other receivables |
13 |
|
799,048 |
|
978,403 |
|
790,864 |
|
Cash and cash equivalents |
14 |
|
82,923 |
|
130,720 |
|
116,831 |
|
Restricted cash |
14 |
|
4,000,000 |
|
4,000,000 |
|
2,054,947 |
|
|
|
|
4,909,451 |
|
6,920,279 |
|
2,993,165 |
|
Assets held for sale |
7 |
|
125,037,050 |
|
- |
|
125,766,570 |
|
|
|
|
129,946,501 |
|
6,920,279 |
|
128,759,735 |
|
Total Assets |
|
|
133,436,274 |
|
135,589,195 |
|
132,558,639 |
|
|
|
|
|
|
|
|
|
|
Equity and Liabilities |
|
|
|
|
|
|
|
|
Capital and Reserves |
|
|
|
|
|
|
|
|
Called up share capital |
17 |
|
9,429,182 |
|
8,561,499 |
|
8,561,499 |
|
Share premium account |
|
|
140,912,898 |
|
136,762,387 |
|
136,762,387 |
|
Share-based payments reserve |
|
|
6,672,959 |
|
6,513,594 |
|
6,684,820 |
|
Retained loss |
|
|
(60,244,816) |
|
(58,950,664) |
|
(57,516,022) |
|
Currency translation reserve |
|
|
(260,103) |
|
(8,619,657) |
|
(177,021) |
|
Other reserves |
|
|
336,000 |
|
336,000 |
|
336,000 |
|
Amounts recognised in other comprehensive income and accumulated in equity relating to assets held for sale |
7 |
|
(9,755,593) |
|
- |
|
(8,592,661) |
|
Equity attributable to equity holders of the Parent |
|
87,090,527 |
|
84,603,159 |
|
86,059,002 |
|
|
|
|
|
|
|
|
|
|
|
Non-current Liabilities |
|
|
|
|
|
|
|
|
Provisions |
|
|
- |
|
1,644,170 |
|
- |
|
Interest-bearing loans and borrowings |
16 |
|
- |
|
14,682,383 |
|
- |
|
Deferred tax liability |
|
|
125,230 |
|
5,740,566 |
|
106,674 |
|
|
|
|
125,230 |
|
22,067,119 |
|
106,674 |
|
Current Liabilities |
|
|
|
|
|
|
|
|
Trade and other payables |
15 |
|
2,588,413 |
|
10,102,313 |
|
1,806,732 |
|
Interest-bearing loans and borrowings |
16 |
|
28,900,000 |
|
18,816,604 |
|
30,000,000 |
|
|
|
|
31,488,413 |
|
28,918,917 |
|
31,806,732 |
|
Liabilities directly associated with assets held for sale |
7 |
|
14,732,104 |
|
- |
|
14,586,231 |
|
|
|
|
46,220,517 |
|
28,918,917 |
|
46,392,963 |
|
Total Liabilities |
|
|
46,345,747 |
|
50,986,036 |
|
46,499,637 |
|
Total Equity and Liabilities |
|
|
133,436,274 |
|
135,589,195 |
|
132,558,639 |
|
Interim Consolidated Statement of Changes in Equity |
|
|
|
|
|
|
|
|
|
|
|
||
|
For the 6 months ended 30 June 2014 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Called up share capital |
|
Share premium account |
|
Share-based payment and other reserves |
|
Currency translation reserve |
|
Currency translation reserve relating to assets held for sale |
|
Retained loss |
|
Total |
|
|
US$ |
|
US$ |
|
US$ |
|
US$ |
|
US$ |
|
US$ |
|
US$ |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At 1 January 2013 |
8,561,499 |
|
136,762,387 |
|
6,602,045 |
|
(5,224,443) |
|
- |
|
(48,357,296) |
|
98,344,192 |
|
Loss for the year |
- |
|
- |
|
- |
|
- |
|
- |
|
(9,158,726) |
|
(9,158,726) |
|
Currency translation adjustments - subsidiaries |
- |
|
- |
|
- |
|
(3,293,001) |
|
- |
|
- |
|
(3,293,001) |
|
Currency translation adjustments - joint venture |
- |
|
- |
|
- |
|
(252,238) |
|
- |
|
- |
|
(252,238) |
|
Total comprehensive loss for the year |
- |
|
- |
|
- |
|
(3,545,239) |
|
- |
|
(9,158,726) |
|
(12,703,965) |
|
Transfer in relation to assets held for sale |
- |
|
- |
|
- |
|
8,592,661 |
|
(8,592,661) |
|
- |
|
- |
|
Share based payment expense |
- |
|
- |
|
418,775 |
|
- |
|
- |
|
- |
|
418,775 |
|
At 31 December 2013 |
8,561,499 |
|
136,762,387 |
|
7,020,820 |
|
(177,021) |
|
(8,592,661) |
|
(57,516,022) |
|
86,059,002 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At 1 January 2014 |
8,561,499 |
|
136,762,387 |
|
7,020,820 |
|
(177,021) |
|
(8,592,661) |
|
(57,516,022) |
|
86,059,002 |
|
Loss for the period |
- |
|
- |
|
- |
|
- |
|
- |
|
(2,728,794) |
|
(2,728,794) |
|
Share-based payment credit |
- |
|
- |
|
(11,861) |
|
- |
|
- |
|
- |
|
(11,861) |
|
Currency translation adjustments - subsidiaries |
- |
|
- |
|
- |
|
11,696 |
|
(1,162,932) |
|
- |
|
(1,151,236) |
|
Currency translation adjustments - joint venture |
- |
|
- |
|
- |
|
(94,778) |
|
- |
|
- |
|
(94,778) |
|
Total comprehensive loss for the period |
- |
|
- |
|
(11,861) |
|
(83,082) |
|
(1,162,932) |
|
(2,728,794) |
|
(3,986,669) |
|
New share capital subscribed |
867,683 |
|
4,308,865 |
|
- |
|
- |
|
- |
|
- |
|
5,176,548 |
|
Transaction costs on issue of share capital |
- |
|
(158,354) |
|
- |
|
- |
|
- |
|
- |
|
(158,354) |
|
At 30 June 2014 |
9,429,182 |
|
140,912,898 |
|
7,008,959 |
|
(260,103) |
|
(9,755,593) |
|
(60,244,816) |
|
87,090,527 |
|
Consolidated Cash Flow Statement |
|
|
|
|
|
|
|
|
For the 6 months ended 30 June 2014
|
|
|
|
|
|
|
|
|
|
|
|
Unaudited |
|
Audited |
||
|
|
|
|
6 months ended 30 June 2014 |
|
6 months ended 30 June 2013 |
|
Year ended 31 December 2013 |
|
|
|
|
US$ |
|
US$ |
|
US$ |
|
Operating activities |
|
|
|
|
|
|
|
|
Loss before taxation |
|
|
(2,709,230) |
|
(9,721,822) |
|
(11,495,885) |
|
Adjustment to reconcile loss before tax to net cash flows |
|
|
|
|
|
|
|
|
Non-cash |
|
|
|
|
|
|
|
|
Depreciation |
|
|
77,076 |
|
2,730,042 |
|
5,632,077 |
|
Share of loss in joint venture |
|
|
121,442 |
|
127,267 |
|
235,060 |
|
Share-based payment (credit)/expense |
|
|
(11,861) |
|
247,549 |
|
418,775 |
|
Finance revenue |
|
|
(27,071) |
|
(9,291) |
|
(70,810) |
|
Finance costs |
5 |
|
1,575,918 |
|
1,751,751 |
|
3,437,088 |
|
Working capital adjustments |
|
|
|
|
|
|
|
|
(Increase)/decrease in trade and other receivables |
|
(64,690) |
|
241,470 |
|
189,890 |
|
|
Decrease in inventories |
|
|
70,347 |
|
186,463 |
|
661,568 |
|
Increase in trade and other payables |
|
1,093,363 |
|
7,589,764 |
|
9,703,801 |
|
|
Income tax received |
|
|
- |
|
- |
|
167,592 |
|
Net cash flows received from operating activities |
|
|
125,294 |
|
3,143,193 |
|
8,879,156 |
|
|
|
|
|
|
|
|
|
|
Investing activities |
|
|
|
|
|
|
|
|
Purchase of oil and gas properties |
|
|
5,406 |
|
(2,670,631) |
|
(4,789,662) |
|
Advance payments to contractors |
|
|
(36,434) |
|
(19,000) |
|
(76,594) |
|
Purchase of property, plant and equipment |
|
|
31,452 |
|
(90,317) |
|
(83,286) |
|
Proceeds from disposal of property, plant and equipment |
- |
|
32,275 |
|
12,268 |
||
|
Exploration and evaluation payments |
|
|
(1,189,207) |
|
(171,908) |
|
(326,918) |
|
Decrease in restricted cash |
|
|
(1,945,053) |
|
- |
|
1,945,053 |
|
Interest received |
|
|
7,770 |
|
9,291 |
|
32,819 |
|
Net cash used in investing activities |
|
|
(3,126,066) |
|
(2,910,290) |
|
(3,286,320) |
|
Financing activities |
|
|
|
|
|
|
|
|
Proceeds from issue of share capital |
|
|
5,176,548 |
|
- |
|
- |
|
Transaction costs of issue of shares |
|
|
(158,354) |
|
- |
|
- |
|
Proceeds from loan facilities |
|
|
1,500,000 |
|
- |
|
- |
|
Transaction costs on loans and borrowings |
|
|
(100,000) |
|
- |
|
- |
|
Repayment of loan facilities |
|
|
(2,600,000) |
|
(2,600,000) |
|
(6,500,000) |
|
Interest paid |
|
|
(1,016,384) |
|
(1,436,185) |
|
(2,709,529) |
|
Net cash received/(paid) from/(to) financing activities |
2,801,810 |
|
(4,036,185) |
|
(9,209,529) |
||
|
Net decrease in cash and cash equivalents |
|
|
(198,961) |
|
(3,803,282) |
|
(3,616,693) |
|
Translation adjustment |
|
|
(11,804) |
|
(5,420) |
|
(14,607) |
|
Cash and Cash Equivalents held for sale |
|
|
(14,434) |
|
- |
|
(191,291) |
|
Cash and cash equivalents at the beginning of the period |
|
|
308,122 |
|
3,939,422 |
|
3,939,422 |
|
Cash and cash equivalents at the end of the period |
14 |
|
82,923 |
|
130,720 |
|
116,831 |
1. Corporate information
The interim condensed consolidated financial statements of the Group for the six months ended 30 June 2014 were authorised for issue in accordance with a resolution of the Directors on 25 September 2014.
PetroNeft Resources plc ('the Company', or together with its subsidiaries, 'the Group') is a Company incorporated in Ireland. The Company is listed on the Alternative Investment Market ('AIM') of the London Stock Exchange and the Enterprise Securities Market ('ESM') of the Irish Stock Exchange. The address of the registered office and the business address in Ireland is 20 Holles Street, Dublin 2. The Company is domiciled in the Republic of Ireland.
The principal activities of the Group are oil and gas exploration, development and production.
2. Important Events after the Balance Sheet Date
On 17 April 2014, the Company entered into a binding agreement with Oil India Limited ("OIL") to farmout a 50% non-operating interest in Licence 61. Under the terms of the Licence 61 Farmout, OIL will make a total Investment of up to US$85 million consisting of:
· US$35 million upfront cash payment, enabling PetroNeft to repay in full its existing debts (the Macquarie Debt Facility and the Arawak Loan) and provide cash for working capital purposes.
· US$45 million of exploration and development expenditure on Licence 61.
· US$5 million performance bonus, contingent upon average production from the Sibkrayevskoye Field reaching 7,500 bopd within the next five years.
The completion of the Licence 61 Farmout was conditional on shareholder approval, which was granted on 9 May 2014 and on Russian Regulatory approval which was received on 30 June 2014.
On 3 July 2014 the Licence 61 Farmout was completed and the Company repaid all of its outstanding debt to Macquarie (US$8.4 million) and Arawak (US$16.5 million). At the date of approval of these financial statements, the Company has no outstanding debt.
Under the terms of the agreement, OIL subscribed for shares in WorldAce Investments Limited ("WorldAce"), the holding company for Stimul-T, the entity which holds Licence 61 and all related assets and liabilities. Following this, PetroNeft and Oil India Limited both hold 50% of the voting shares, and through the joint venture agreement, both parties have joint control of WorldAce with PetroNeft continuing as operator.
As a result of the Licence 61 Farmout the Company is now debt-free as at the date of the approval of these financial statements. The Directors have a reasonable expectation that the Company, and the Group, have adequate resources to further develop its assets and to continue in operational existence for the foreseeable future. For this reason, the Directors consider it appropriate to continue to adopt the going concern basis in preparing the financial statements.
3. Accounting policies
3.1 Basis of Preparation
The interim condensed consolidated financial statements for the six months ended 30 June 2014 have been prepared in accordance with IAS 34 Interim Financial Reporting.
The interim condensed consolidated financial statements do not include all the information and disclosures required in the annual financial statements, and should be read in conjunction with the Group's annual financial statements as at 31 December 2013 which are available on the Group's website - www.petroneft.com.
The interim condensed consolidated financial statements are presented in US dollars ("US$").
3.2 Significant Accounting Policies
The accounting policies adopted in the preparation of the interim condensed consolidated financial statements are consistent with those followed in the preparation of the Group's annual financial statements for the year ended 31 December 2013.
4. Segment information
At present the Group has one reportable operating segment, which is oil exploration and production. As a result, there are no further disclosures required in respect of the Group's reporting segment.
The risk and returns of the Group's operations are primarily determined by the nature of the activities that the Group engages in, rather than the geographical location of these operations. This is reflected by the Group's organisational structure and the Group's internal financial reporting systems.
Management monitors and evaluates the operating results for the purpose of making decisions consistently with how it determines operating profit or loss in the consolidated financial statements.
Geographical segments
All of the Group's sales are in Russia. Substantially all of the Group's capital expenditures are in Russia.
|
|
Assets are allocated based on where the assets are located: |
|
|
|||||
|
|
|
|
|
Unaudited |
|
Audited |
||
|
|
|
|
|
6 months ended 30 June 2014 |
|
6 months ended 30 June 2013 |
|
Year ended 31 December 2013 |
|
|
Non-current assets |
|
|
US$ |
|
US$ |
|
US$ |
|
|
Russia |
|
|
3,429,701 |
|
128,662,026 |
|
3,794,764 |
|
|
Ireland |
|
|
4,158 |
|
6,890 |
|
4,140 |
|
|
|
|
|
3,433,859 |
|
128,668,916 |
|
3,798,904 |
|
|
|
|
|
|
|
|
|
|
|
5. |
Finance costs |
|
|
|
|
|
|
|
|
|
|
|
|
Unaudited |
|
Audited |
||
|
|
|
|
|
6 months ended 30 June 2014 |
|
6 months ended 30 June 2013 |
|
Year ended 31 December 2013 |
|
|
|
|
|
US$ |
|
US$ |
|
US$ |
|
|
|
|
|
|
|
|
|
|
|
|
Interest on loans |
|
|
1,118,505 |
|
1,625,139 |
|
3,299,496 |
|
|
Extension fee on Macquarie loan |
|
|
400,000 |
|
- |
|
- |
|
|
Unwinding of discount on decommissioning provision |
|
|
57,413 |
|
126,612 |
|
137,592 |
|
|
|
|
|
1,575,918 |
|
1,751,751 |
|
3,437,088 |
|
6. |
Income tax |
|
|
|
|
|
|
|
|
|
|
|
|
Unaudited |
|
Audited |
||
|
|
|
|
|
6 months ended 30 June 2014 |
|
6 months ended 30 June 2013 |
|
Year ended 31 December 2013 |
|
|
|
|
|
US$ |
|
US$ |
|
US$ |
|
|
Current income tax |
|
|
|
|
|
|
|
|
|
Current income tax charge |
|
|
1,008 |
|
2,206 |
|
480 |
|
|
Total current income tax |
|
|
1,008 |
|
2,206 |
|
480 |
|
|
|
|
|
|
|
|
|
|
|
|
Deferred tax |
|
|
|
|
|
|
|
|
|
Relating to origination and reversal of temporary differences |
|
18,556 |
|
869,340 |
|
(2,337,639) |
|
|
|
Total deferred tax |
|
|
18,556 |
|
869,340 |
|
(2,337,639) |
|
|
Income tax expense reported in the Consolidated Income Statement |
|
19,564 |
|
871,546 |
|
(2,337,159) |
|
|
7. |
Assets held for sale |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unaudited |
|
Audited |
||
|
|
|
|
|
6 months ended 30 June 2014 |
|
6 months ended 30 June 2013 |
|
Year ended 31 December 2013 |
|
|
|
|
|
US$ |
|
US$ |
|
US$ |
|
|
Assets held for sale |
|
|
|
|
|
|
|
|
|
Oil and gas properties |
|
|
95,249,570 |
|
- |
|
96,023,796 |
|
|
Property, plant and equipment |
|
|
903,547 |
|
- |
|
935,000 |
|
|
Exploration and evaluation assets |
|
|
27,520,127 |
|
- |
|
27,235,454 |
|
|
Inventories |
|
|
1,147,907 |
|
- |
|
1,215,210 |
|
|
Trade and other receivables |
|
|
201,465 |
|
- |
|
165,819 |
|
|
Cash and cash equivalents |
|
|
14,434 |
|
- |
|
191,291 |
|
|
|
|
|
125,037,050 |
|
- |
|
125,766,570 |
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities directly associated with assets held for sale |
|
|
|
|
|
|
|
|
|
Trade and other payables |
|
|
10,763,824 |
|
- |
|
10,633,142 |
|
|
Deferred tax liability |
|
|
2,400,000 |
|
- |
|
2,400,000 |
|
|
Provisions |
|
|
1,568,280 |
|
- |
|
1,553,089 |
|
|
|
|
|
14,732,104 |
|
- |
|
14,586,231 |
|
|
|
|
|
|
|
|
|
|
|
|
Amounts recognised in other comprehensive income and accumulated in equity relating to assets held for sale |
|
|
|
|
|
|
|
|
|
Currency translation reserve |
|
|
9,755,593 |
|
- |
|
8,592,661 |
|
|
|
|
|
9,755,593 |
|
- |
|
8,592,661 |
|
8. |
Oil and gas properties |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Wells |
|
Equipment and facilities |
|
Pipeline |
|
Total |
|
|
|
US$ |
|
US$ |
|
US$ |
|
US$ |
|
|
Cost |
|
|
|
|
|
|
|
|
|
At 1 January 2013 |
75,359,259 |
|
28,168,900 |
|
16,403,020 |
|
119,931,179 |
|
|
Additions |
4,038,164 |
|
1,017,713 |
|
55,611 |
|
5,111,488 |
|
|
Transferred to property plant and equipment |
- |
|
(155,183) |
|
- |
|
(155,183) |
|
|
Transferred to exploration and evaluation assets |
(864,783) |
|
- |
|
- |
|
(864,783) |
|
|
Translation adjustment |
(5,332,793) |
|
(2,010,516) |
|
(1,159,067) |
|
(8,502,376) |
|
|
|
73,199,847 |
|
27,020,914 |
|
15,299,564 |
|
115,520,325 |
|
|
Transferred to assets held for sale |
(73,199,847) |
|
(27,020,914) |
|
(15,299,564) |
|
(115,520,325) |
|
|
At 31 December 2013 |
- |
|
- |
|
- |
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation |
|
|
|
|
|
|
|
|
|
At 1 January 2013 |
12,679,952 |
|
1,913,201 |
|
240,270 |
|
14,833,423 |
|
|
Charge for the year |
4,352,641 |
|
1,088,078 |
|
115,257 |
|
5,555,976 |
|
|
Transferred to property plant and equipment |
- |
|
(78,673) |
|
- |
|
(78,673) |
|
|
Translation adjustment |
(654,101) |
|
(139,846) |
|
(20,250) |
|
(814,197) |
|
|
|
16,378,492 |
|
2,782,760 |
|
335,277 |
|
19,496,529 |
|
|
Transferred to assets held for sale |
(16,378,492) |
|
(2,782,760) |
|
(335,277) |
|
(19,496,529) |
|
|
At 31 December 2013 |
- |
|
- |
|
- |
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
Net book values |
|
|
|
|
|
|
|
|
|
At 30 June 2014 |
- |
|
- |
|
- |
|
- |
|
|
At 31 December 2013 |
- |
|
- |
|
- |
|
- |
|
9. |
Property, Plant and Equipment |
|
|
|
|
|
|
|
|
|
|
Buildings & |
|
|
|
|
|
|
|
|
|
leasehold |
|
Plant and |
|
Motor |
|
|
|
|
|
improvements |
|
machinery |
|
vehicles |
|
Total |
|
|
|
US$ |
|
US$ |
|
US$ |
|
US$ |
|
|
Cost |
|
|
|
|
|
|
|
|
|
At 1 January 2013 |
1,102,684 |
|
1,854,724 |
|
123,995 |
|
3,081,403 |
|
|
Additions |
- |
|
14,551 |
|
68,335 |
|
82,886 |
|
|
Transferred from oil and gas properties |
- |
|
108,427 |
|
46,756 |
|
155,183 |
|
|
Disposals |
- |
|
(39,380) |
|
- |
|
(39,380) |
|
|
Translation adjustment |
(77,679) |
|
(129,353) |
|
(12,148) |
|
(219,180) |
|
|
|
1,025,005 |
|
1,808,969 |
|
226,938 |
|
3,060,912 |
|
|
Transferred to assets held for sale |
(1,025,005) |
|
(335,997) |
|
(226,938) |
|
(1,587,940) |
|
|
At 1 January 2014 |
- |
|
1,472,972 |
|
- |
|
1,472,972 |
|
|
Additions |
- |
|
- |
|
- |
|
- |
|
|
Translation adjustment |
- |
|
(37,738) |
|
- |
|
(37,738) |
|
|
At 30 June 2014 |
- |
|
1,435,234 |
|
- |
|
1,435,234 |
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation |
|
|
|
|
|
|
|
|
|
At 1 January 2013 |
218,464 |
|
1,082,298 |
|
84,015 |
|
1,384,777 |
|
|
Charge for the year |
61,563 |
|
227,083 |
|
40,357 |
|
329,003 |
|
|
Transferred from oil and gas properties |
- |
|
52,512 |
|
26,161 |
|
78,673 |
|
|
Disposals |
- |
|
(27,112) |
|
- |
|
(27,112) |
|
|
Translation adjustment |
(17,311) |
|
(81,280) |
|
(7,898) |
|
(106,489) |
|
|
|
262,716 |
|
1,253,501 |
|
142,635 |
|
1,658,852 |
|
|
Transferred to assets held for sale |
(262,716) |
|
(247,589) |
|
(142,635) |
|
(652,940) |
|
|
At 1 January 2014 |
- |
|
1,005,912 |
|
- |
|
1,005,912 |
|
|
Charge for the period |
- |
|
77,076 |
|
- |
|
77,076 |
|
|
Translation adjustment |
- |
|
(21,903) |
|
- |
|
(21,903) |
|
|
At 30 June 2014 |
- |
|
1,061,085 |
|
- |
|
1,061,085 |
|
|
|
|
|
|
|
|
|
|
|
|
Net book values |
|
|
|
|
|
|
|
|
|
At 30 June 2014 |
- |
|
374,149 |
|
- |
|
374,149 |
|
|
At 31 December 2013 |
- |
|
467,060 |
|
- |
|
467,060 |
|
10. |
Exploration and evaluation assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Group |
|
|
|
|
|
|
Exploration & Evaluation Expenditure |
|
|
|
|
|
|
|
|
|
US$ |
|
|
Cost |
|
|
|
|
|
|
|
|
|
At 1 January 2013 |
|
|
|
|
|
|
28,294,677 |
|
|
Additions |
|
|
|
|
|
|
69,449 |
|
|
Transferred from oil and gas properties |
|
|
|
|
|
|
864,783 |
|
|
Translation adjustment |
|
|
|
|
|
|
(1,993,455) |
|
|
|
|
|
|
|
|
|
27,235,454 |
|
|
Transferred to assets held for sale |
|
|
|
|
|
|
(27,235,454) |
|
|
At 31 December 2013 |
|
|
|
|
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
Net book values |
|
|
|
|
|
|
|
|
|
At 30 June 2014 |
|
|
|
|
|
|
- |
|
|
At 31 December 2013 |
|
|
|
|
|
|
28,294,677 |
|
11. |
Equity-accounted investment in Joint Venture |
|
|
|
|
|
PetroNeft Resources plc has a 50% interest in Russian BD Holdings B.V., a jointly controlled entity which holds 100% of LLC Lineynoye, an entity involved in oil and gas exploration and the registered holder of Licence 67. The interest in this joint venture is accounted for using the equity accounting method. Russian BD Holdings B.V. is incorporated in the Netherlands and carries out its activities in Russia.
|
|
|
|
|
|
|
|
|
Share of net assets |
|
|
|
|
|
|
|
|
|
US$ |
|
|
At 1 January 2013 |
|
|
|
|
|
|
3,819,142 |
|
|
Retained loss for the year |
|
|
|
|
|
|
(235,060) |
|
|
Translation adjustment |
|
|
|
|
|
|
(252,238) |
|
|
At 1 January 2014 |
|
|
|
|
|
|
3,331,844 |
|
|
Retained loss for the period |
|
|
|
|
|
|
(121,442) |
|
|
Translation adjustment |
|
|
|
|
|
|
(94,778) |
|
|
At 30 June 2014 |
|
|
|
|
|
|
3,115,624 |
Summarised financial statement information prepared in accordance with IFRS of the equity-accounted joint venture entity is disclosed below:
Summarised Interim Financial statements of equity-accounted joint venture (50% share)
|
|
|
|
|
Unaudited |
|
Audited |
||
|
|
|
|
|
6 months ended 30 June 2014 |
|
6 months ended 30 June 2013 |
|
Year ended 31 December 2013 |
|
|
|
|
|
US$ |
|
US$ |
|
US$ |
|
|
Sales and other operating revenues |
|
|
- |
|
- |
|
- |
|
|
Operating expenses |
|
|
(78,188) |
|
(35,545) |
|
(114,563) |
|
|
Exchange loss |
|
|
961 |
|
(65,450) |
|
(65,784) |
|
|
Finance revenue |
|
|
522 |
|
86 |
|
184 |
|
|
Finance costs |
|
|
(44,737) |
|
(21,377) |
|
(45,134) |
|
|
Loss before taxation |
|
|
(121,442) |
|
(122,286) |
|
(225,297) |
|
|
Taxation |
|
|
- |
|
(4,982) |
|
(9,763) |
|
|
Loss for the period |
|
|
(121,442) |
|
(127,268) |
|
(235,060) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unaudited |
|
Audited |
||
|
|
|
|
|
6 months ended 30 June 2014 |
|
6 months ended 30 June 2013 |
|
Year ended 31 December 2013 |
|
|
|
|
|
US$ |
|
US$ |
|
US$ |
|
|
Current assets |
|
|
419,899 |
|
108,627 |
|
164,066 |
|
|
Non-current assets |
|
|
6,669,409 |
|
4,273,484 |
|
4,774,180 |
|
|
Total assets |
|
|
7,089,308 |
|
4,382,111 |
|
4,938,246 |
|
|
|
|
|
|
|
|
|
|
|
|
Current liabilities |
|
|
(2,023,500) |
|
(51,643) |
|
(376,128) |
|
|
Non-current liabilities |
|
|
(1,950,184) |
|
(892,185) |
|
(1,230,274) |
|
|
Total liabilities |
|
|
(3,973,684) |
|
(943,828) |
|
(1,606,402) |
|
12. |
Inventories |
|
|
|
|
|
|
|
|
|
|
|
|
Unaudited |
|
Audited |
||
|
|
|
|
|
6 months ended 30 June 2014 |
|
6 months ended 30 June 2013 |
|
Year ended 31 December 2013 |
|
|
|
|
|
US$ |
|
US$ |
|
US$ |
|
|
|
|
|
|
|
|
|
|
|
|
Oil stock |
|
|
- |
|
1,662,932 |
|
- |
|
|
Materials |
|
|
27,480 |
|
148,224 |
|
30,523 |
|
|
|
|
|
27,480 |
|
1,811,156 |
|
30,523 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
13. |
Trade and other receivables |
|
|
|
|
|
|
|
|
|
|
|
|
Unaudited |
|
Audited |
||
|
|
|
|
|
6 months ended 30 June 2014 |
|
6 months ended 30 June 2013 |
|
Year ended 31 December 2013 |
|
|
|
|
|
US$ |
|
US$ |
|
US$ |
|
|
|
|
|
|
|
|
|
|
|
|
Russian VAT |
|
|
- |
|
16,729 |
|
- |
|
|
Russian profit tax receivable |
|
|
- |
|
6,610 |
|
- |
|
|
Other receivables |
|
|
57,545 |
|
156,180 |
|
14,544 |
|
|
Receivable from jointly controlled entity |
|
|
689,830 |
|
721,092 |
|
717,190 |
|
|
Advances to and receivables from related parties |
- |
|
7,035 |
|
- |
||
|
|
Advances to contractors |
|
|
- |
|
11,965 |
|
- |
|
|
Prepayments |
|
|
51,673 |
|
58,792 |
|
59,130 |
|
|
|
|
|
799,048 |
|
978,403 |
|
790,864 |
The Directors consider that the carrying amount of trade and other receivables approximates their fair value.
Other receivables are non-interest-bearing and are normally settled on 60-day terms.
Amounts owed by subsidiary undertakings are interest-bearing. Interest is charged at rates ranging from 0% to 10%.
|
14. |
Cash and Cash Equivalents and Restricted Cash |
|
|
|
|
|||
|
|
Group |
|
|
|
|
|
|
|
|
|
|
|
|
Unaudited |
|
Audited |
||
|
|
|
|
|
6 months ended 30 June 2014 |
|
6 months ended 30 June 2013 |
|
Year ended 31 December 2013 |
|
|
|
|
|
US$ |
|
US$ |
|
US$ |
|
|
|
|
|
|
|
|
|
|
|
|
Cash at bank and in hand |
|
|
82,923 |
|
130,720 |
|
116,831 |
|
|
Restricted cash |
|
|
4,000,000 |
|
4,000,000 |
|
2,054,947 |
|
|
|
|
|
4,082,923 |
|
4,130,720 |
|
2,171,778 |
At 30 June 2014 restricted cash amounting to US$4 million is being held in a Macquarie Debt Service Reserve Account ("DSRA"). This account is part of the security package held by Macquarie and may be offset against the loan in the event of a default on the loan or by agreement between the parties. These funds were used to part repay the Macquarie debt facility when the loan was repaid in full on 3 July 2014.
Bank deposits earn interest at floating rates based on daily deposit rates. Short-term deposits are made for varying periods of between one day and one month depending on the immediate cash requirements of the Group, and earn interest at the respective short-term deposit rates.
|
15. |
Trade and other payables |
|
|
|
|
|
|
|
|
|
|
|
|
Unaudited |
|
Audited |
||
|
|
|
|
|
6 months ended 30 June 2014 |
|
6 months ended 30 June 2013 |
|
Year ended 31 December 2013 |
|
|
|
|
|
US$ |
|
US$ |
|
US$ |
|
|
|
|
|
|
|
|
|
|
|
|
Trade payables |
|
|
1,112,674 |
|
1,545,374 |
|
813,476 |
|
|
Trade payables to jointly controlled entity |
|
|
- |
|
182,945 |
|
- |
|
|
Trade payables to related parties |
|
|
- |
|
2,011,715 |
|
- |
|
|
Corporation tax |
|
|
64,300 |
|
66,878 |
|
63,292 |
|
|
Oil taxes, VAT and employee taxes |
|
|
84,502 |
|
4,936,089 |
|
87,004 |
|
|
Other payables |
|
|
62,829 |
|
186,958 |
|
22,745 |
|
|
Payments received in advance |
|
|
- |
|
387,595 |
|
- |
|
|
Accruals |
|
|
1,264,108 |
|
784,759 |
|
820,215 |
|
|
|
|
|
2,588,413 |
|
10,102,313 |
|
1,806,732 |
The Directors consider that the carrying amount of trade and other payables approximates their fair value.
Trade and other payables are non-interest-bearing and are normally settled on 60-day terms.
Trade payables and accruals principally comprise amounts outstanding for trade purchases and ongoing costs.
|
16. |
Loans and borrowings |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
|
|
Group and Company |
Effective interest rate |
Contractual maturity date |
Unaudited |
|
Audited |
||
|
|
|
% |
|
6 months ended 30 June 2014 |
|
6 months ended 30 June 2013 |
|
Year ended 31 December 2013 |
|
|
Interest bearing |
|
|
US$ |
|
US$ |
|
US$ |
|
|
Current liabilities |
|
|
|
|
|
|
|
|
|
Macquarie Bank - US$75,000,000 loan facility |
9.79% |
7-July-14 |
12,400,000 |
|
18,816,604 |
|
15,000,000 |
|
|
Belgrave Naftogaz - US$16,500,000 loan |
7.38% |
30-May-15 |
16,500,000 |
|
- |
|
15,000,000 |
|
|
Total current liabilities |
|
|
28,900,000 |
|
18,816,604 |
|
30,000,000 |
|
|
Non-current liabilities |
|
|
|
|
|
|
|
|
|
Arawak - US$15,000,000 loan |
7.16% |
30-May-15 |
|
|
14,682,383 |
|
- |
|
|
Total non-current liabilities |
|
|
- |
|
14,682,383 |
|
- |
|
|
Total loans and borrowings |
|
|
28,900,000 |
|
33,498,987 |
|
30,000,000 |
|
|
Contractual undiscounted liability |
|
28,900,000 |
|
33,900,000 |
|
30,000,000 |
|
Macquarie loan facility
During the period, Macquarie agreed to extend the maturity date of their loan to 7 July 2014 in order to allow the completion of the transaction with Oil India Limited for a fee of US$400,000. On 3 July 2014 the loan was repaid in full from the proceeds of the Oil India transaction.
Certain oil and gas properties (wells, central processing facility, pipeline) together with shares in WorldAce Investments Ltd, shares in Stimul-T, certain bank accounts and inventories were pledged as a security for the Macquarie loan facility agreement. All of this security was released once the loan was repaid.
Arawak Energy loan facility
The loan was secured on PetroNeft's 50% interest in Russian BD Holdings B.V. In July 2013, pursuant to an internal re-organisation, Arawak Energy Russia B.V. assigned the loan to its sister company Belgrave Naftogas B.V. On 3 July 2014 the loan was repaid in full from the proceeds of the Oil India transaction and the security was released.
|
17. |
Share Capital |
|
|
|
|
|
|
|
Allotted, called up and fully paid equity |
|
|
Number of Ordinary Shares |
|
Called up share capital US$ |
|
|
At 1 January 2013 |
|
|
644,920,275 |
|
8,561,499 |
|
|
Issued in the year |
|
|
- |
|
- |
|
|
At 1 January 2014 |
|
|
644,920,275 |
|
8,561,499 |
|
|
Issued in the period |
|
|
62,325,631 |
|
867,683 |
|
|
At 30 June 2014 |
|
|
707,245,906 |
|
9,429,182 |
The Company issued 62,325,631 new shares for consideration of US$5.18 million during the period. The net proceeds of this share issue of US$5.02 million were used to repay debt, finance expenditure on oil and gas properties, exploration and evaluation costs and corporate overhead.
18. Related party disclosures
Transactions between PetroNeft Resources plc and its subsidiaries have been eliminated on consolidation. Details of transactions between the Group and other related parties are disclosed below.
Vakha Sobraliev, a Director of PetroNeft, is the principal of LLC Tomskburneftegaz ("TBNG") which has drilled production and exploration wells for the Group. Various contracts for drilling have been awarded to TBNG in recent years following competitive tendering processes. All drilling contracts with TBNG are "turnkey" contracts whereby TBNG assumes substantially all liabilities in relation to the health and safety, environmental and other risks associated with drilling operation. As part of this relationship PetroNeft Group companies also occasionally sell sundry goods and services to TBNG. Other companies related to TBNG also provide some services to the Group such as transportation, power management and repairs.
The following is a summary of the transactions:
|
|
30 June 2014 |
31 December 2013 |
||
|
|
TBNG |
Other companies |
TBNG |
Other companies |
|
|
US$ |
US$ |
US$ |
US$ |
|
Period ended |
|
|
|
|
|
Maximum value of new contracts awarded during the period |
1,849,042 |
- |
- |
- |
|
Paid during the period for drilling and related services |
142,980 |
- |
1,527,850 |
- |
|
Paid during the period for other services |
- |
- |
- |
128,416 |
|
Amount due to TBNG and related companies at period-end |
1,758,546 |
134 |
1,962,797 |
138 |
|
Received during the period for sundry goods and services |
- |
- |
49,445 |
- |
|
Amount due from TBNG and related companies at period end |
6,611 |
3,189 |
6,839 |
3,283 |
GLOSSARY
Arawak Arawak Energy Russia B.V.
bbl Barrel.
Belgrave Naftogas Belgrave Naftogas B.V., a member of the Arawak group of companies
bopd Barrels of oil per day.
Company PetroNeft Resources plc.
CPF Central Processing Facility.
Group The Company and its subsidiary undertakings.
IAS International Accounting Standard.
IFRS International Financial Reporting Standard.
km Kilometres.
km2/ sq km Square kilometres.
Licence 61 The Group's Exploration and Production Licence in the Tomsk Oblast, Russia. It contains seven known oil fields, Lineynoye, Tungolskoye, West Lineynoye, Arbuzovskoye, Kondrashevskoye, Sibkrayevskoye and North Varyakhskoye and 27 Prospects and Leads that are currently being explored.
Licence 61 Farmout An agreement whereby Oil India Limited subscribed for shares in WorldAce, the holding company for Stimul-T, the entity which holds Licence 61 and all related assets and liabilities, and following which, PetroNeft and Oil India Limited both hold 50% of the voting shares, and through the shareholders agreement, both parties have joint control of WorldAce with PetroNeft acting as operator
Licence 67 The Group's Exploration and Production Licence in the Tomsk Oblast, Russia. It contains two oil fields, Ledovoye and Cheremshanskoye and several potential prospects.
Lineynoye Limited Liability Company Lineynoye, a wholly owned subsidiary of Russian BD Holdings B.V., registered in the Russian Federation.
Macquarie Macquarie Bank Limited.
OIL/ Oil India Oil India Limited
PetroNeft PetroNeft Resources plc.
Russian BD Holdings B.V. Russian BD Holdings B.V., a company owned 50% by PetroNeft and registered in the Netherlands.
Spud To commence drilling a well.
Stimul-T Limited Liability Company Stimul-T, a wholly owned subsidiary of WorldAce, based in the Russian Federation.
WorldAce WorldAce Investments Limited, a company owned 50% by PetroNeft and registered in Cyprus.
This information is provided by RNS
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