Audited Results for the year ended 30 June 2023
information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulation (EU) No. 596/2014 as amended by The Market Abuse (Amendment) (EU Exit) Regulations 2019.
15 November 2023
Helium One Global Ltd
("Helium One" or "the Company")
Audited Results for the year ended 30 June 2023
Helium One Global (AIM: HE1), the primary helium explorer in Tanzania, is pleased to announce the Company's audited results for the year ended 30 June 2023.
Summary:
· Sourced appropriate oil & gas drilling rig for phase 2 drilling programme through the acquisition of its Epiroc Predator 220 drilling rig
· Completed analysis of high resolution Falcon Airborne Gravity Gradiometry and aero-magnetic data over the Balangida Rift Basin, demonstrating a greater understanding of prospectivity and rift geometry
· Successful fundraise of £9.9 million in December 2022, for the drilling of the Tai-3 Well at Rukwa. An additional £6.8 million was raised in September 2023.
· Lorna Blaisse appointed as CEO in February 2023, with James Smith appointed as Chairman post period end
· The Company reports a total comprehensive loss attributable to shareholders of $2,672,915
· Group's cash position, at at 30 June 2023, was US$9,600,786 (30 June 2022: US$4,906,153)
· Commencement of drilling programme at Tai-3 in the Rukwa Basin in Q3 2023, successfully reaching a TD of 1,448m measured depth as announced on 7 November 2023
· Elevated helium shows, up to six times above background, have been identified in the Lower Karoo Group and Basement targets whilst drilling and the shows increased in frequency and quality with depth, as anticipated.
· The Company is currently running wireline logging for formation evaluation and downhole gas sampling.
James Smith, Chairman of Helium One, commented:
"The year under review has been dominated by obtaining a rig for the Company's Phase 2 drilling programme. Post year-end we were delighted to acquire our own drill rig, giving the Company a greater degree of optionality and an additional revenue stream, as well as spudding the Tai-3 well in Q3 2023 as stated.
"The year ahead promises to be an exciting one. We are fully funded for our ongoing drilling campaign at Tai, the results of which will soon be published, and are funded for the follow up well at Itumbula."
Lorna Blaisse, CEO, commented:
"This past year has been an incredibly busy time for the Company delivering the rig and commencing drilling at Tai-3. Despite the hurdles that we have had to overcome, Helium One remains resilient and we continue to deliver on our promises and strategy.
"I would like to thank our team for their constant commitment to the Company, as well as our local communities for their continued support. I would also like to extend my thanks to our shareholders who have supported us during this turbulent year. We are excited to see what is in store for Helium One and look forward to providing updates from our drilling programme."
For further information please visit the Company's website: www.helium-one.com
Contact
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Helium One Global Ltd Lorna Blaisse, CEO |
+44 20 7920 3150 |
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Liberum Capital Limited (Nominated Adviser and Joint Broker) Scott Mathieson Ed Thomas Nikhil Varghese |
+44 20 3100 2000 |
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Peterhouse Capital Limited (Joint Broker) Lucy Williams |
+44 20 7220 9792 |
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Tavistock (Financial PR) Nick Elwes Tara Vivian - Neal |
+44 20 7920 3150
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Notes to Editors
Helium One Global, the AIM-listed Tanzanian explorer, holds prospecting licences totalling more than 2,965km2 across three distinct project areas, with the potential to become a strategic player in resolving a supply-constrained helium market.
The Rukwa, Balangida, and Eyasi projects are located within rift basins on the margin of the Tanzanian Craton in the north and southwest of the country. The assets lie near surface seeps with helium concentrations ranging up to 10.6% He by volume. All Helium One's licences are held on a 100% equity basis and are in close proximity to the required infrastructure.
The Company's flagship Rukwa Project is located within the Rukwa Rift Basin covering 1,900km2 in south-west Tanzania. The project is considered to be an advanced exploration project with leads and prospects defined by a subsurface database including multispectral satellite spectroscopy, airborne gravity gradiometry, 2D seismic data, and QEMSCAN analysis. The Rukwa Project has been de-risked by the 2021 drilling campaign, which identified reservoir and seal with multiple prospective intervals from basin to near surface within a working helium system.
Helium One is listed on the AIM market of the London Stock Exchange with the ticker of HE1 and on the OTCQB in the United States with the ticker HLOGF.
Chairman's Statement
I am pleased to present the Annual Report and Financial Statements for the year ended 30 June 2023 and my first since I became Chairman of Helium One Global Limited. I would like to thank Ian Stalker, who stood down as Chairman of the Board in July 2023, for his commitment to the Company during his five-year tenure. Ian oversaw a period of significant achievement, from the Company's successful listing on AIM to the maiden drilling programme at Rukwa.
The period under review was dominated by the challenge of obtaining a suitable rig for our phase II drilling programme at Tai 3 in the Rukwa basin which was compounded by increased demand from other operators in the oil and gas industry resulting in a scarcity of rigs and ancillary well evaluation equipment available for the East African market.
The team worked incredibly hard in sourcing rigs and equipment and whilst their efforts were thwarted on a number of occasions, I am very pleased that we were able to successfully acquire our own rig after the accounting year-end. This allows us greater control and flexibility over our drilling timetable and also provides a potential source of revenue for the Company in the future as the rig will be available to be leased by third parties in the region.
We were also delighted to deliver our drilling programme at Rukwa, which we commenced in Q3 as we outlined back in February 2023, and we are very encouraged by the initial results we have seen at Tai 3 with elevated helium shows. I would like to take this opportunity to thank the Board and our team for all their efforts and continued dedication in what was an incredibly testing year for the Company.
The Board and management team underwent some changes throughout the year with the appointment of Lorna Blaisse as Chief Executive Officer, replacing David Minchin who stepped down in February of this year. I am very pleased that Lorna agreed to take on the role and exceptionally pleased with her performance since she took over. I have no doubt she will continue to work tirelessly on behalf of the Company and its shareholders to deliver the best possible outcome from the current and future work programmes. I would also like to welcome Graham Jacobs to the Board as Financial and Commercial Director. Graham's experience will undoubtedly be of huge value to the Company in this next stage of our development.
I would also like to thank the Government of Tanzania and the local communities in which we operate for their continued support which has enabled the Company to advance its operations at such a dramatic pace. We look forward to continuing our work with them in the year ahead, and to delivering our Phase II programme. Finally, I would like to thank all of our shareholders for their continued commitment and support and look forward to providing further updates from our Tai-3 drilling as well as the follow up programme at Itumbula.
James Smith
Non-Executive Chairman
14 November 2023
Chief Executive's Statement
I am pleased to be reporting on the Group's annual results for the 12 months to 30 June 2023. The period was another incredibly busy and testing period for the team as we worked to obtain an appropriate rig and associated equipment for our Phase II drilling programme in a very tight rig market in East Africa.
Operational Review
Following the extensive evaluation of rig options and, in order to remain on the critical path to a Q3 spud, the Company successfully completed the acquisition of its Epiroc Predator 220 drilling rig in July 2023- an oil and gas type rig capable of drilling to depths in excess of 2,000m - and its subsequent mobilisation to the Rukwa site. This is a highly significant achievement for the Company as ownership of the rig provides the opportunity to move quickly into further exploration drilling and, in a success case, allows the appraisal of Tai without the additional cost of keeping a rig on standby or become challenged by mobilising another rig into the country again.
Whilst we acquired the Epiroc Predator 220 drilling rig in July of this year, the Company had previously, in October 2022, received a report from a third party, Aberdeen Drilling Consultants, an internationally recognised expert in rig audit and evaluation, on the operational capability of the rig. This confirmed that the rig was in good condition.
In December 2022, the Company completed an analysis of its proprietary high resolution Falcon Airborne Gravity Gradiometry and aero-magnetic data over the Balangida Rift Basin ("Balangida") in collaboration with Getech. This work will lead to further helium gas exploration target generation in Balangida, widening the Company's opportunity in Tanzania. This same workflow was subsequently applied to a regional dataset over the Eyasi Rift Basin and has enabled the team to evaluate the prospectivity potential in both basins, after gaining an improved understanding of rift geometry and subsurface structuration.
Balangida has shown high-grade helium macro seeps enriched with other high-value noble gasses. Recent field work sampling showed 6.2%-6.4% helium and 2.0% argon. The study enabled us to increase our knowledge of depth to basement and sediment thickness whilst providing a greater understanding of rift geometry, basin evolution and subsurface structure to aid in future exploration programmes.
In May 2023 the Company completed an independent verification of the prospective resources of the Tai Prospect (Tai). The evaluation of the total gas and helium prospective resources, and completion of a Competent Person's Report ("CPR") for Tai has been carried out and issued by reserves auditors ERC Equipoise Ltd (ERCE).
The unrisked best estimate of helium estimated to be potentially recoverable from undiscovered accumulations ("2U") in the report is 2.8 billion cubic feet (Bcf) and the 2U is 212.2 Bcf across the combined intervals of the Lake Bed Fm, Nsungwe Fm, Karoo Sandstone and Weathered Basement. This demonstrates a 61% increase in the original resource estimate from the previous 2020 CPR completed by SRK Consulting (Australasia) Pty Ltd ("SRK").
The unrisked high case estimate of helium estimated to be potentially recoverable from undiscovered accumulations ("3U") is 7.1 Bcf in the ERCE report, which is a 30% increase from the previous 2020 CPR completed by SRK. The deterministic sum of the 3U prospective resource is 437.8 Bcf in the ERCE report, which is a 294% increase from the previous CPR referenced above.
These substantial increases are the result of more detailed interpretation of the additional 2D seismic data acquired across Tai in 2021 (from Phase II and Phase II seismic surveys), and the Company's improved understanding of the structural closure.
These results support the work completed by the Company's technical team and demonstrates our technical competency in prospect maturation and identification. Tai remains the best-defined prospect within the Company's portfolio and highlights the opportunity to maximise the economic potential of helium in the Rukwa Basin.
On 7 November 2023, post period end, the Company announced that the Tai 3 well had successfully reached a total depth of 1,448m measured depth having encountered weathered crystalline Basement.
We are delighted with the initial results from Tai 3 and it was extremely encouraging to see elevated helium shows, up to six times above background, in the Lower Karoo Group and Basement targets and that helium shows increased in frequency and quality with depth, as we had anticipated.
As at the date of this report, the wireline programme had commenced and the Company was preparing to take downhole gas samples.
The current annual global demand for helium is 6.6 Bcf in a US$7 billion market. Helium prices continue to rise due to the current shortage and with a global average import price of US$457 per thousand cubic feet in January 2023. The last twelve months have seen a 39% price increase, a trend set to continue given the current global deficit.
Licence Area Evaluation
During the period, Helium One renewed 12 of its licences which were due for second renewal in September and October 2022. As part of the renewal process, Helium One conducted a review of all of its licences with the objective of fully or partially relinquishing licences that were not considered to be prospective. The combined relinquished area totals 1,549.27 km2, which will save approximately US$309,000 per year in licence fees and an impairment charge of US$8,520,929 was included in the year ended 30 June 2022 accounts. The Helium One technical team selected the chosen areas for relinquishment based on the following criteria:
· inaccessible offshore areas with no, or poorly, defined exploration leads;
· onshore areas with no, or poorly, defined exploration leads; and
· onshore areas on outcropping basement i.e. no sediment fill therefore deemed to be non-prospective
By relinquishing portions of our licenced acreage, Helium One can eliminate those areas deemed to be non-prospective and ensure future work programmes are focussed more effectively on the remaining, higher ranked acreage. Such relinquishment occurred in September and October 2022.
The Company now holds prospecting licences totalling 2,965 km2 across its three project areas, Rukwa, Eyasi and Balangida.
Fundraising
In December 2022, the Company raised gross proceeds of approximately £9.9 million (approximately US$12.01 million) through the issue of an aggregate of 197,922,716 new ordinary shares at a price of 5 pence per Ordinary Share. The proceeds of this raise were used for the drilling of the Tai 3 exploration well.
In September 2023, post period end, the Company raised an additional £6.8 million before expenses (approximately US$8.7 million) through the issue of an aggregate of 113,333,333 new ordinary shares at a price of 6 pence per new ordinary share.
Financial Results for the Year Ended 30 June 2023
For the year to 30 June 2023, the Group recorded a total comprehensive loss for the year attributable to the equity holders of the Company of US$2,672,915 a decrease compared with US$14,231,206 for the year to 30 June 2022 mainly as a result of an impairment in 2022 amounting to US$8.5million and share based payments of US$3.3million.
The Group's net assets as at 30 June 2023 were US$27,204,804 in comparison with US$18,033,568 at 30 June 2022. The increase is due to the additional funds from the new shares issued. At 30 June 2023, the Group's cash position was US$9,600,786 (30 June 2022: US$4,906,153).
Outlook
Helium remains an irreplaceable technology commodity in a current supply crisis and the Board believes that Helium One has a portfolio that can potentially help resolve this crisis. The year ahead promises to be another busy and very significant period for the Company as we deliver our Phase II drilling programme and what will hopefully be a commercial discovery at our Rukwa Project. We have a strong and highly experienced management team clearly focussed on delivering success at Rukwa.
I would like to take this opportunity to thank all our staff who have again worked so hard this year as well as the local communities and the Government ministries that have continued to work with us and support us enabling us to continue to drive our programme forward. Lastly, I would also like to thank all of our shareholders for their continued support and look forward to providing further updates as we progress our Phase II exploration programme.
Lorna Blaisse
Chief Executive Officer
14 November 2023
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
For the year ended 30 June 2023
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Note |
Year ended 30 June 2023 $ |
Year ended 30 June 2022 $ |
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Continuing Operations
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Revenue |
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- |
- |
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Administrative expenses |
6 |
(2,768,503) |
(4,664,694) |
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Impairments |
5 |
(597,698) |
(8,701,875) |
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Other income |
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- |
10,418 |
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Operating loss
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|
(3,366,201) |
(13,356,151) |
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Finance income |
8 |
38,447 |
- |
|
Loss for the year before taxation
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|
(3,327,754) |
(13,356,151) |
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Taxation |
9 |
(6,376) |
- |
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Loss for the year from continuing operations (attributable to the equity holders of the parent) |
|
(3,334,130) |
(13,356,151) |
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|
|
|
|
|
Items that may be reclassified subsequently to profit and loss:
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|
|
|
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Exchange difference on translation of foreign operations |
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661,215 |
(875,055) |
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|
|
|
|
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Total comprehensive loss for the year (attributable to the equity holders of the parent) |
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(2,672, 915) |
(14,231,206) |
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|
|
|
|
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Earnings per share: |
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|
|
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Basic and diluted earnings per share (cents) |
10 |
(0.46) |
(2.17) |
The accompanying notes form part of these consolidated Financial Statements.
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As at 30 June 2023
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|
Note |
30 June 2023 $ |
30 June 2022 $ |
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ASSETS Non-current assets |
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|
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Intangible assets |
11 |
15,509,515 |
11,758,362 |
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Property, Plant & Equipment |
12 |
5,611 |
7,760 |
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Other receivables |
14 |
1,231,593 |
1,210,352 |
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Total non-current assets |
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16,746,719 |
12,976,474 |
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Current assets |
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Inventory |
13 |
1,476,362 |
117,878 |
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Trade and other receivables |
14 |
2,238,094 |
644,336 |
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Cash and cash equivalents |
15 |
9,600,786 |
4,906,153 |
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Total current assets |
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13,315,242 |
5,668,367 |
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Total assets |
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30,061,961 |
18,644,841 |
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LIABILITIES Current liabilities |
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Trade and other payables |
16 |
(2,857,157) |
(611,273) |
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Total liabilities |
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(2,857,157) |
(611,273) |
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|
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|
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Net assets |
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27,204,804 |
18,033,568 |
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EQUITY |
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|
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Share premium |
17 |
54,468,236 |
43,061,318 |
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Other reserves |
19 |
4,242,482 |
2,587,348 |
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Retained earnings |
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(31,505,914) |
(27,615,098) |
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Total equity |
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27,204,804 |
18,033,568 |
The Financial Statements were approved and authorised for issue by the Board of Directors on 14 November 2023 and were signed on its behalf by:
Lorna Blaisse
Director and Chief Executive Officer
The accompanying notes form part of these consolidated Financial Statements.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the year ended 30 June 2023
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|
Share premium |
Other reserves |
Retained earnings |
Total |
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|
Note |
$ |
$ |
$ |
$ |
|
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Balance as at 1 July 2021 |
42,660,713 |
601,884 |
(14,726,339) |
28,536,258 |
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Comprehensive income |
|
|
|
|
|
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Loss for the year |
- |
- |
(13,356,151) |
(13,356,151) |
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Currency translation differences |
|
(875,055) |
- |
(875,055) |
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|
Total comprehensive loss for the year |
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(875,055) |
(13,356,151) |
(14,231,206) |
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|
Transactions with owners recognised directly in equity |
|
|
|
|
|
|
Issue of ordinary shares - for fees/services |
260,965 |
- |
- |
260,965 |
|
|
Share based payments |
- |
3,327,911 |
- |
3,327,911 |
|
|
Warrants and options expired during the year |
- |
(18,980) |
18,980 |
- |
|
|
Warrants and options exercised during the year |
139,640 |
(448,412) |
448,412 |
139,640 |
|
|
Total transactions with owners |
400,605 |
2,860,519 |
467,392 |
3,728,516 |
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|
|
|
|
|
|
|
|
Balance as at 30 June 2022 |
43,061,618 |
2,587,348 |
(27,615,098) |
18,033,568 |
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|
Balance as at 1 July 2022 |
|
43,061,318 |
2,587,348 |
(27,615,098) |
18,033,568 |
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Comprehensive income
|
|
|
|
|
|
|
Loss for the year |
|
- |
- |
(3,334,130) |
(3,334,130) |
|
Currency translation differences |
|
- |
661,215 |
- |
661,215 |
|
Total comprehensive loss for the year |
- |
661,215 |
(3,334,130) |
(2,672,915) |
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|
Transactions with owners recognised directly in equity |
|
|
|
|
|
|
Foreign currency reserve adjustment |
28 |
- |
- |
(721,237) |
(721,237) |
|
Issue of ordinary shares |
17 |
12,018,934 |
- |
- |
12,018,934 |
|
Reversal of Merger Acquisition Reserve |
|
- |
349,710 |
- |
349,710 |
|
Cost of share issue |
|
(643,685) |
- |
- |
(643,685) |
|
Share based payments |
|
- |
808,760 |
- |
808,760 |
|
Warrants and options expired during the year |
|
- |
(146,480) |
146,480 |
- |
|
Warrants and options exercised during the year |
|
31,669 |
(18,071) |
18,071 |
31,669 |
|
Total transactions with owners |
|
11,406,918 |
993,919 |
(556,686) |
11,844,151 |
|
Balance as at 30 June 2023 |
|
54,468,236 |
4,242,482 |
(31,505,914) |
27,204,804 |
The accompanying accounting policies and notes form part of these consolidated Financial Statements.
CONSOLIDATED CASH FLOW STATEMENT
For the year ended 30 June 2023
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|
Note |
30 June 2023 $ |
30 June 2022 $ |
|
Cash flows from operating activities |
|
|
|
|
Loss after taxation |
|
(3,334,130) |
(13,356,151) |
|
Adjustments for: |
|
|
|
|
Depreciation and amortisation |
12 |
6,817 |
4,896 |
|
Share-based payments |
|
808,760 |
3,327,911 |
|
Shares issued for services |
|
- |
260,965 |
|
Net finance costs |
8 |
(38,447) |
- |
|
Impairment of intangibles |
11 |
100,803 |
8,520,929 |
|
Taxation Paid |
9 |
6,376 |
- |
|
Increase in trade and other receivables |
|
(1,614,999) |
(1,205,704) |
|
Increase/(Decrease) in trade and other payables |
|
2,245,884 |
(594,980) |
|
(Increase)/decrease in inventories |
13 |
(1,358,484) |
107,001 |
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Foreign exchange |
|
425,567 |
(560,434) |
|
Net cash (outflows) from operating activities |
|
(2,751,853) |
(3,495,567) |
|
Investing activities |
|
|
|
|
Purchase of property, plant, and equipment |
12 |
(4,668) |
(7,404) |
|
Exploration and evaluation activities |
11 |
(3,851,956) |
(7,218,006) |
|
Net cash used in investing activities |
|
(3,856,624) |
(7,225,410) |
|
Financing activities |
|
|
|
|
Taxation Paid |
9 |
(6,376) |
- |
|
Proceeds from issue of share capital |
17 |
12,018,934 |
- |
|
Proceeds from exercise of warrant options |
17 |
31,669 |
139,640 |
|
Cost of share issue |
17 |
(643,685) |
- |
|
Interest received on funds invested |
|
38,447 |
- |
|
Net cash generated from financing activities |
|
11,438,989 |
139,640 |
|
|
|
|
|
|
Net increase in cash and cash equivalents |
|
4,830,512 |
(10,581,337) |
|
Cash and cash equivalents at the beginning of the year |
|
4,906,153 |
15,802,111 |
|
Exchange gains/(losses) on cash |
|
(135,879) |
(314,621) |
|
Cash and cash equivalents at the end of the year |
15,26 |
9,600,786 |
4,906,153 |
|
|
|
|
|
The accompanying accounting policies and notes form part of these consolidated Financial Statements.
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2023
1. General Information
The principal activity of Helium One Global Limited (the 'Company') (formerly Helium One Limited) and its subsidiaries (together the 'Group') is the exploration and development of helium gas resources. The Company is incorporated and domiciled in the British Virgin Islands. The address of its registered office is Vistra Corporate Services Centre, Wickhams Cay II, Road Town, Tortola, VG1110, British Virgin Islands. The Company is exempt from preparing separate parent company Financial Statements for the year ended 30 June 2023 in line with BVI Business Companies Act 2004.
The Company's ordinary shares are admitted to trading on the Alternative Investment Market (AIM) of the London Stock Exchange under the ticker 'HE1'. The Company is also listed on the OTCQB market with the ticker HLOGF and is quoted on Börse Frankfurt with symbol 9K3.
2. Functional and Presentational Currency
The determination of an entity's functional currency is assessed on an entity-by-entity basis. A company's functional currency is defined as the currency of the primary economic environment in which the entity operates. The functional currency of the Parent Company is the US Dollar, because it operates in the BVI, where the majority of its transactions are in US dollars. The functional currency of the Tanzanian subsidiaries is Tanzanian Shillings in which currency the subsidiaries incur payroll costs and are required to report and file accounts locally.
The functional and presentational currency of the Group for year ended 30 June 2023 is US dollars. The presentational currency is an accounting policy choice.
3. Summary of Significant Accounting Policies
The principal accounting policies that have been used in the preparation of these consolidated Financial Statements are set out below. These policies have been consistently applied unless otherwise stated.
Basis of preparation
The consolidated Financial Statements have been prepared in accordance with International Financial Reporting Standards (IFRS) and IFRS Interpretations Committee (IFRS IC) interpretations as adopted by the European Union applicable to companies under IFRS and in accordance with AIM Rules. The Financial Statements are prepared on the historical cost basis or the fair value basis where the fair valuing of relevant assets or liabilities has been applied.
The preparation of Financial Statements in conformity with IFRS requires management to make judgements, estimates and assumptions that affect the application of policies and reported amounts of assets and liabilities, income and expenses. The estimates and associated assumptions are based on historical experience and factors that are believed to be reasonable under the circumstances, the results of which form the basis of making judgements about carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Changes in accounting estimates may be necessary if there are changes in the circumstances on which the estimate was based, or as a result of new information or more experience. Such changes are recognised in the period in which the estimate is revised.
New and amended standards adopted by the Group
There were no new or amended accounting standards that required the Group to change its accounting policies for the year ended 30 June 2023.
New Accounting Standards issued but not yet effective
The standards and interpretations that are relevant to the Group, issued, but not yet effective, up to the date of the Financial Statements are listed below. The Group intends to adopt these standards, if applicable, when they become effective.
|
Standard |
Impact on initial application |
Effective date |
|
Amendments to IAS 1 |
Classification of Liabilities as Current or Non-Current |
1 January 2024* |
|
Amendments to IAS 1 |
Non-Current Liabilities with Covenants |
1 January 2024* |
|
Amendments to IAS 1 |
Disclosure of accounting policies |
1 January 2023 |
|
Amendments to IAS 8 |
Definition of accounting estimates |
1 January 2023 |
|
Amendments to IAS 12 |
Deferred tax related to assets and liabilities arising from a single transaction |
1 January 2023 |
*EU effective date not yet confirmed
The Directors have evaluated the impact of transition to the above standards and do not consider that there will be a material impact on the Group's results or shareholders' funds.
Basis of consolidation
Subsidiaries
Subsidiaries are entities controlled by the Group. The Group controls an entity when it is exposed to, or has rights to, variable returns from its involvement with the entity and could affect those returns through its power over the entity. The Financial Statements of subsidiaries are included in the consolidated Financial Statements from the date on which control commences until the date on which control ceases.
The investments in subsidiaries held by the Company are valued at cost less any provision for impairment that is considered to have occurred, the resultant loss being recognised in the income statement.
The consolidated Financial Statements incorporate the financial statements of the Company and its subsidiaries up to 30 June 2023.
Transactions eliminated on consolidation
Intra-group balances and transactions, and any unrealised income and expenses (except for foreign currency transaction gains or losses) arising from intra-group transactions, are eliminated. Unrealised losses are eliminated in the same way as unrealised gains, but only to the extent that there is no evidence of impairment.
Foreign currency transactions
Transactions in foreign currencies are translated into the respective functional currencies of Group companies at the exchange rates at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies are translated into the functional currency at the exchange rate at the reporting date. Non-monetary assets and liabilities that are measured at fair value in a foreign currency are translated into the functional currency at the exchange rate when the fair value was determined. Non-monetary items that are measured based on historical cost in a foreign currency are translated at the exchange rate at the date of the transaction. Foreign currency differences are recognised in profit or loss and presented on the statement of comprehensive income.
However, foreign currency differences arising from the translation of the following items are recognised in OCI:
· An investment in equity securities designated as at FVOCI (except on impairment, in which case foreign currency differences that have been recognised in OCI are reclassified to profit or loss).
· A financial liability designated as a hedge of the net investment in a foreign operation to the extent that the hedge is effective.
Foreign operations
The assets and liabilities of foreign operations and fair value adjustments arising on acquisition, are translated into United States Dollars at the exchange rates at the dates of the transactions. Foreign currency differences are recognised in OCI and accumulated in the translation reserve, except to the extent that the translation difference is allocated to OCI. When a foreign operation is disposed of in its entirety or partially such that control, significant influence or joint control is lost, the cumulative amount in the translation reserve related to that foreign operation is reclassified to profit or loss as part of the gain or loss on disposal.
If the Group disposes of part of its interest in a subsidiary but retains control, then the relevant proportion of the cumulative amount is reattributed to OCI. When the Group disposes of only part of an associate or joint venture while retaining significant influence or joint control, the relevant proportion of the cumulative amount is reclassified to profit or loss.
Going concern
The consolidated Financial Statements have been prepared on a going concern basis. The Group incurred a net loss of $3,334,130 and incurred operating cash outflows of $2,751,853 and is not expected to generate any revenue or positive cash flows from operations in the next 12 months from the date at which these consolidated Financial Statements were approved. In assessing whether the going concern assumption is appropriate, the Directors have taken into account all relevant available information about the current and future position of the Group, including current level of resources and the required level of spending on exploration and evaluation activities. As part of their assessment, the Directors have also taken into account the ability to raise additional funding whilst maintaining sufficient cash resources to meet all commitments.
The Group meets its working capital requirements from its cash and cash equivalents. The Group is pre-revenue and to date the Group has raised finance for its activities through the issue of equity. The Group has $9,600,786 of cash and cash equivalents at 30 June 2023. The Group's ability to meet operational objectives and general overheads is reliant on raising further capital in the near future.
As with all similar sized exploration companies, the Group is required to raise money for further exploration and capital projects as and when required. There can be no assurance that the Group's projects will be fully developed in accordance with current plans or completed on time or budget with the current level of cash held by the group, and therefore it is expected that further fundraising will need to take place over the 12 month period from the date of approval of these Financial Statements, in order to fully fund work programmes currently contemplated.
Cash and cash equivalents
Cash includes petty cash and cash held in current bank accounts. Cash equivalents include short-term investments that are readily convertible to known amounts of cash and which are subject to insignificant risk of changes in value.
Property, plant, and equipment
Property, plant, and equipment are stated at cost, less accumulated depreciation, and any provision for impairment losses.
Depreciation is charged on each part of an item of property, plant, and equipment to write off the cost of assets less the residual value over their estimated useful lives, using the straight-line method. Depreciation is charged to the income statement. The estimated useful lives are as follows:
Office equipment - 2 years
There was no depreciation charge for the field equipment in the year as this was fully depreciated in the financial year ended 30 June 2019.
Expenses incurred in respect of the maintenance and repair of property, plant and equipment are charged against income when incurred. Refurbishments and improvements expenditure, where the benefit is expected to be long lasting, is capitalised as part of the appropriate asset.
An item of property, plant and equipment ceases to be recognised upon disposal or when no future economic benefits are expected from its use or disposal. Any gain or loss arising on cessation of recognition of the asset (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is included in the income statement in the year the asset ceases to be recognised.
Intangible assets - Exploration and Evaluation assets
The Group applies the full cost method of accounting for Exploration & Evaluation ('E&E') costs, having regard to the requirements of IFRS 6 Exploration for and Evaluation of Mineral Resources. Under the full cost method of accounting, costs of exploring for and evaluating mineral resources are accumulated by reference to appropriate cost centres being the appropriate licence area and /or licence areas held under licence agreements. A licence agreement grants the right to explore and evaluate mineral resources, and to acquire the licences later at the discretion of the licence holder. Exploration and evaluation assets are tested for impairment as described further below. Where appropriate, licences may be grouped into a cost pool.
All costs associated with E&E are initially capitalised as E&E assets, including payments to acquire the legal right to explore, costs of technical services and studies, seismic acquisition, exploratory drilling, and testing.
Exploration and evaluation costs include directly attributable overheads together with the cost of materials consumed during the exploration and evaluation phases. Costs incurred prior to having obtained the legal right to explore an area are expensed directly to profit and loss as they are incurred.
E&E Costs are not amortised prior to the conclusion of appraisal activities.
E&E costs assets related to each exploration licence or pool of licences are carried forward until the existence (or otherwise) of commercial reserves has been determined. Once the technical feasibility and commercial viability of extracting a mineral resource is demonstrable, the related E&E assets are assessed for impairment on an individual licence or cost pool basis, as appropriate, as set out below and any impairment loss is recognised in profit and loss. The carrying value, after, any impairment loss, of the relevant E&E assets is then reclassified as Property, Plant and Equipment.
E&E assets are assessed for impairment when facts and circumstances suggest that the carrying amount may exceed its recoverable amount. Such indicators include, but are not limited to, those situations outlined in paragraph 20 of IFRS 6 Exploration for and Evaluation of Mineral resources and include the criteria for which a determination is made as to whether commercial reserves exist.
The aggregate carrying value is compared against the expected recoverable amount, by reference to the present value of future cash flows expected to be derived from production of commercial reserves.
When a licence or pool of licences is abandoned or there is no planned future work, the costs associated with the respective licences are written off in full.
Any impairment loss is recognised in profit and loss and separately disclosed.
The Group considers each licence, or where appropriate pool of licences, separately for purposes of determining whether impairment of E&E assets has occurred.
Impairment
All capitalised exploration and evaluation assets and property, plant and equipment are monitored for indications of impairment. Where a potential impairment is indicated, assessment is made for the group of assets representing a cash generating unit.
In accordance with IFRS 6 the Group firstly considers the following facts and circumstances in their assessment of whether the Group's exploration and evaluation assets may be impaired:
(a) the period for which the Group has the right to explore in the specific area has expired during the period or will expire in the near future, and is not expected to be renewed.
(b) substantive expenditure on further exploration for and evaluation of resources in the specific area is neither budgeted nor planned.
(c) exploration for and evaluation of resources in the specific area have not led to the discovery of commercially viable quantities of mineral resources and the Group has decided to discontinue such activities in the specific area.
(d) sufficient data exist to indicate that, although a development in the specific area is likely to proceed, the carrying amount of the exploration and evaluation asset is unlikely to be recovered in full from successful development or by sale.
In addition to the above, the Group gives due consideration to the following criteria:
· unexpected geological occurrences render the resource uneconomic;
· a significant fall in realised or estimated prices render the project uneconomic; or
· an increase in operating costs occurs.
If any such facts or circumstances are noted, the Group perform an impairment test in accordance with the provisions of IAS 36.
The aggregate carrying value is compared against the expected recoverable amount of the cash generating unit. The recoverable amount is the higher of value in use and the fair value less costs to sell. An impairment loss is reversed if the assets or cash-generating unit's recoverable amount exceeds its carrying amount. A reversal of impairment loss is recognised in the profit or loss immediately.
Provisions
A provision is recognised in the Statement of Financial Position when the Group or Company has a present legal or constructive obligation because of a past event, and it is probable that an outflow of economic benefits will be required to settle the obligation. If the effect is material, provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and, where appropriate, the risks specific to the liability.
Taxation
There is no current tax payable in view of the losses incurred to date.
Deferred income taxes are calculated using the Statement of Financial Position liability method on temporary differences. Deferred tax is provided on the difference between the carrying amounts of assets and liabilities and their tax bases. However, deferred tax is not provided on the initial recognition of goodwill or on the initial recognition of an asset or liability unless the related transaction is a business combination or affects tax or accounting profit. Deferred tax on temporary differences associated with shares in subsidiaries and joint ventures is not provided if reversal of these temporary differences can be controlled by the Company and it is probable that reversal will not occur in the foreseeable future. In addition, tax losses available to be carried forward as well as other income tax credits to the Company are assessed for recognition as deferred tax assets.
Deferred tax liabilities are provided in full, with no discounting. Deferred tax assets are recognised to the extent that it is probable that the underlying deductible temporary differences will be able to be offset against future taxable income. Current and deferred tax assets and liabilities are calculated at tax rates that are expected to apply to their respective period of realisation, provided they are enacted or substantively enacted at the Statement of Financial Position date.
Changes in deferred tax assets or liabilities are recognised as a component of tax expense in the income statement, except where they relate to items that are charged or credited directly to equity, in which case the related current or deferred tax is also charged or credited directly to equity.
Inventory
Inventory is valued at the lower of cost and net realisable value. The cost of inventories is based on the cost of the consumable and cost of transport to the site where stored. Net realisable value is estimated selling price in the ordinary course of business, less costs related to selling the inventory.
For other inventories, cost is determined on a weighted average basis (for fuel and chemicals) or a specific identification basis (for spares and supplies), including the cost of direct material and (where applicable) direct labour and a proportion of overhead expenses. Items are classified as spares and supplies inventory where they are either standard parts, easily resalable or available for use on non-specific campaigns, and as intangible exploration and evaluation assets where they are specific parts intended for specific projects. Net realisable value is determined by an estimate of the price that could be realised through resale or scrappage based on its condition at the balance sheet date.
Equity
Equity comprises the following:
1. "Share premium" represents the total value of equity shares issued (there is no par value) net of expenses of the share issues.
2. "Other reserves" includes the following:
a. the "Merger reserve" arose on the acquisition of CJT Ventures Limited. There have been no movements in the reserve since acquisition.
b. the "Share option reserve" represent the fair values of share options and warrants issued and
c. the "Foreign exchange reserve" represents the cumulative translation difference on the net assets of the subsidiaries
3. "Retained reserves" include all current and prior year results, including fair value adjustments on financial assets, as disclosed in the consolidated statement of comprehensive income.
Share issue costs
Incremental costs directly attributable to the issue of ordinary shares are recognised as a deduction from share premium in accordance with IAS 32.
Share-based payments
The Company awards share options to certain Directors and employees to acquire shares of the Company. Additionally, the Company has issued warrants to providers of equity finance. Warrants issued as part of Share Issues have been determined as equity instruments under IAS 32. Since the fair value of the shares issued at the same time is equal to the price paid, these warrants, by deduction, are considered to have been issued at nil value.
All goods and services received in exchange for the grant of any share-based payment are measured at their fair values in accordance with IFRS 2. Where employees are rewarded using share-based payments, the fair values of employees' services are determined indirectly by reference to the fair value of the instrument granted to the employee.
The fair value is appraised at the grant date and excludes the impact of non-market vesting conditions. Fair value is measured by use of the Black Scholes model. The expected life used in the model has been adjusted, based on management's best estimate, for the effects of non-transferability, exercise restrictions, and behavioural considerations. All equity-settled share-based payments are recognised as an expense in the income statement with a corresponding credit to "other reserves."
If vesting periods or other non-market vesting conditions apply, the expense is allocated over the vesting period, based on the best available estimate of the number of share options expected to vest. Estimates are subsequently revised if there is any indication that the number of share options expected to vest differs from previous estimates. Any cumulative adjustment prior to vesting is recognised in the current period. No adjustment is made to any expense recognised in prior years if share options exercised are different to that estimated on vesting. Upon exercise of share options, the proceeds received net of attributable transaction costs are credited to share premium.
A gain or loss is recognised in profit or loss when a financial liability is settled through the issuance of the Company's own equity instruments. The amount of the gain or loss is calculated as the difference between the carrying value of the financial liability extinguished and the fair value of the equity instrument issued. A gain or loss is recognised in profit or loss on the expiry of a financial liability. The amount of the gain or loss is calculated as the difference between the carrying value of the expired financial liability and the fair value of the equity instrument issued.
Financial instruments
Financial assets
Classification
The Group's financial assets consist of financial assets held at amortised cost. The classification depends on the purpose for which the financial assets were acquired. Management determines the classification of its financial assets at initial recognition.
Financial assets held at amortised cost
Assets that are held for collection of contractual cash flows, where those cash flows represent solely payments of principal and interest, are measured at amortised cost. Any gain or loss arising on derecognition is recognised directly in the profit or loss and presented in other gain/ (losses) together with foreign exchange gains and losses. Impairment losses are presented as a separate line item in the statement of profit or loss.
They are included in current assets, except for maturities greater than 12 months after the reporting date, which are classified as non-current assets. The Group's financial assets at amortised cost comprise trade and other current assets and cash and cash equivalents at the year-end.
Recognition and measurement
Regular purchases and sales of financial assets are recognised on the trade date - the date on which the Group commits to purchasing or selling the asset. Financial assets are initially measured at fair value plus transaction costs. Financial assets are de-recognised when the rights to receive cash flows from the assets have expired or have been transferred, and the Group has transferred substantially all of the risks and rewards of ownership.
Financial assets are subsequently carried at amortised cost using the effective interest method.
Impairment of financial assets
The Group assesses, on a forward-looking basis, the expected credit losses associated with its financial assets carried at amortised cost. For trade and other receivable due within 12 months the Group applies the simplified approach permitted by IFRS 9. Therefore, the Group does not track changes in credit risk, but rather recognises a loss allowance based on the financial asset's lifetime expected credit losses at each reporting date.
A financial asset is impaired if there is objective evidence of impairment as a result of one or more events that occurred after the initial recognition of the asset, and that loss event(s) had an impact on the estimated future cash flows of that asset that can be estimated reliably. The Group assesses at the end of each reporting period whether there is objective evidence that a financial asset, or a group of financial assets, is impaired.
The criteria that the Group uses to determine that there is objective evidence of an impairment loss include:
· Significant financial difficulty of the issuer or obligor;
· A breach of contract, such as a default or delinquency in interest or principal repayments;
· The Group, for economic or legal reasons relating the borrower's financial difficulty, granting the borrower a concession that the lender would not otherwise consider; and
· It becomes probable that the borrower will enter bankruptcy or other financial reorganisation.
The Group first assesses whether objective evidence of impairment exists.
The amount of the loss is measured as the difference between the asset's carrying amount and the present value of estimated future cash flow (excluding future credit losses that have not been incurred), discounted at the financial asset's original effective interest rate. The asset's carrying amount is reduced and the loss is recognised in profit or loss.
If, in a subsequent period, the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after the impairment was recognised (such as an improvement in the debtor's credit rating), the reversal of the previously recognised impairment loss is recognised in profit or loss.
Financial liabilities at amortised cost
Trade payables are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-currently liabilities.
Trade payables are recognised initially at fair value, and subsequently measured at amortised cost using the effective interest method.
Other financial liabilities are initially measured at fair value. They are subsequently measured at amortised cost using the effective interest method.
Financial liabilities are de-recognised when the Group's contractual obligations expire or are discharged or cancelled.
Segment reporting
Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision makers. The chief operating decision makers, who are responsible for allocating resources and assessing performance of the operating segments, have been identified as the board of directors.
4. Critical accounting judgments, estimates and assumptions
The preparation of the Financial Statements in conformity with IFRSs requires management to make estimates and assumptions that affect the reported amounts of the assets and liabilities and disclosure of contingent assets and liabilities at the date of the Financial Statements and the reported amount of expenses during the year. Actual results may vary from the estimates used to produce these Financial Statements.
Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.
Significant items subject to such estimates and assumptions include:
Valuation of exploration and evaluation expenditure (see Note 11)
Exploration and evaluation assets include mineral rights and exploration and evaluation costs, including payments to acquire the legal right to explore, costs of technical services and studies, seismic acquisition, exploratory drilling, and testing. Exploration and evaluation costs are capitalised if management concludes that future economic benefits are likely to be realisable and determines that economically viable extraction operation can be established as a result of exploration activities and internal assessment of mineral resources. According to 'IFRS 6 Exploration for and evaluation of mineral resources', the potential indicators of impairment include: management's plans to discontinue the exploration activities, lack of further substantial exploration expenditure planned, expiry of exploration licences in the period or in the nearest future, or existence of other data indicating the expenditure capitalised is not recoverable. At the end of each reporting period, management assesses whether such indicators exist for the exploration and evaluation assets capitalised, which requires significant judgement. This review takes into consideration long term commodity prices, anticipated resource volumes and supply and demand outlook. As of 30 June 2023, total exploration and evaluation costs capitalised amounted to $15,509,515 after taking into account an impairment of $100,803 following the unsuccessful attempt to purchase a rig for the drilling of the Tai-C Well in relation to which all costs associated with this purchase were impaired. (2022: $8,520,929 reflecting impairment arising as a result of the relinquishment of certain licences).
Tax receivable (see Note 14)
At 30 June 2023, the Group recognised an amount of $1,231,593 (2022: $1,210,352) within other receivables which relates to VAT receivable in Tanzania. The amount is subject to review and agreement by the Tanzanian Revenue Authority in accordance with VAT legislation. The Company has engaged the services of a local advisory company to assist with this process, have already received approximately $47,000 in refunds and the Directors believe that the amount will be recovered in full and therefore have not recognised any impairment to the carrying value of this amount.
Share based payments (see Note 18)
The Group issues share options and warrants to its employees, directors, investors and suppliers. These are valued in accordance with IFRS 2 "Share-based payments". In calculating the related fair value on the issue of either share options or warrants, the Group will use a variety of estimates and judgements in respect of inputs used including share price volatility, risk free rate, and expected life. The Group uses the Black Scholes method of valuation in determining fair value.
5. Segment information
Management has determined the operating segments based on reports reviewed by the Board of Directors that are used to make strategic decisions. During the period the Group had interests in two key geographical segments, being the British Virgin Islands and Tanzania. Activities in British Virgin Islands is limited to corporate management as well as desktop exploration costs whilst activities in Tanzania relates to operations and exploration. The Group structure and management reports received by the Directors are used to make strategic decisions reflecting the split of operations.
|
2023 Note |
Tanzania $ |
BVI $ |
Total $ |
|
Other Income |
- |
38,447 |
38,447 |
|
Administrative expenses |
(300,290) |
(1,233,886) |
(1,534,176) |
|
Total impairments |
(116,486) |
(481,212) |
(597,698) |
|
Impairment of loans |
- |
(380,409) |
(380,409) |
|
Impairment of inventory 13 |
(116,486) |
- |
(116,486) |
|
Impairment of intangibles 11 |
- |
(100,803) |
(100,803) |
|
Share based payments |
- |
(808,760) |
(808,760) |
|
Corporate Taxes |
(6,376) |
- |
(6,376) |
|
Foreign exchange |
(554,951) |
129,384 |
(425,567) |
|
Loss from operations per reportable segment |
(978,103) |
(2,356,027) |
(3,334,130) |
|
Additions to non-current assets |
(2,031,262) |
5,801,507 |
3,770,245 |
|
Intangible assets |
9,635,535 |
5,773,177 |
15,509,515 |
|
Inventory |
1,476,362 |
- |
1,476,362 |
|
Reportable segment assets |
12,543,376 |
17,518,585 |
30,061,961 |
|
Reportable segment liabilities |
(2,351,578) |
(505,579) |
(2,857,157) |
|
2022 |
Tanzania |
BVI |
Total |
|
|
$ |
$ |
$ |
|
Other Income |
- |
10,418 |
10,418 |
|
Administrative expenses |
(333,475) |
(1,563,742) |
(1,897,217) |
|
Total impairments |
(6,996,726) |
(1,705,149) |
(8,701,875) |
|
Impairment of loans |
(47,537) |
(26,139) |
(73,676) |
|
Impairment of inventory 13 Impairment of intangibles 11 |
(107,270) (6,841,919) |
- (1,679,010) |
(107,270) (8,520,929) |
|
Share based payments |
- |
(3,327,911) |
(3,327,911) |
|
Foreign exchange |
65,753 |
494,681 |
560,434 |
|
Loss from operations per reportable segment |
(7,264,448) |
(6,091,703) |
(13,356,151) |
|
Additions to non-current assets |
(1,098,418) |
423,653 |
(674,765) |
|
Intangible assets |
8,232,922 |
3,525,440 |
11,758,362 |
|
Inventory |
117,878 |
- |
117,878 |
|
Reportable segment assets |
8,483,451 |
10,161,390 |
18,644,841 |
|
Reportable segment liabilities |
(325,126) |
(286,147) |
(611,273) |
Segment assets and liabilities are allocated based on geographical location.
6. Expenses by nature breakdown
|
|
30 June 2023 $ |
30 June 2022 $ |
|
Depreciation |
6,817 |
4,896 |
|
Wages and salaries (including Directors' fees) |
1,313,202 |
3,251,224 |
|
Professional & consulting fees |
634,227 |
950,852 |
|
Foreign exchange movements |
425,567 |
(560,434) |
|
Insurance |
64,772 |
66,518 |
|
Office expenses |
75,537 |
30,572 |
|
Travel and subsistence expenses |
28,007 |
79,876 |
|
Other expenses |
220,374 |
841,190 |
|
|
2,768,503 |
4,664,694 |
During the year the Group obtained the following services from their auditors:
|
|
30 June 2023 $ |
30 June 2022 $ |
|
|
|
|
|
Fees payable to the Group's auditors for the audit of the Company |
91,180 |
56,848 |
|
Fees payable to the Subsidiaries auditors for the audit of the Subsidiaries |
22,983 |
21,633 |
|
Fees payable in respect of audit overruns |
- |
46,168 |
|
|
114,163 |
124,649 |
7. Directors and employees
|
|
30 June 2023 $ |
30 June 2022 $ |
|
|
|
|
|
Wages and salaries |
296,622 |
336,831 |
|
Social security costs |
75,615 |
91,085 |
|
Pension costs |
7,269 |
7,067 |
|
Share based payments |
808,760 |
2,746,664 |
|
Directors' remuneration (note 7.1) |
632,202 |
595,928 |
|
|
1,820,468 |
3,777,575 |
|
Less capitalised amounts |
(507,266) |
(526,351) |
|
|
1,313,202 |
3,251,224 |
Wages and salaries include amounts that are recharged between subsidiaries. Some of these costs are then capitalised as exploration and evaluation assets and others are administration expenses.
The share-based payments comprised the fair value of warrants and options granted to directors and employees in respect of services provided.
Apart from the directors, the Group only had an average number of six employees during the year (2022: Five).
|
|
30 June 2023 $ |
30 June 2022 $ |
|
|
|
|
|
Amounts attributable to the highest paid director: |
|
|
|
Director's remuneration |
229,622 |
227,308 |
|
|
229,622 |
227,308 |
David Minchin was a full time CEO from 1 December 2020 until 8 February 2023. He was replaced by Lorna Blaisse. Russel Swarts was employed on a full-time basis from 1 June 2021, but became a non-executive director from 1 August 2023. The other directors provided professional services as required on a part-time basis. Details of Directors' remuneration are disclosed below.
7.1 Directors remuneration
|
|
Salaries and Fees |
Bonuses |
Total 30 June 2023 |
|
$ |
$ |
$ |
|
|
Ian Stalker |
72,226 |
- |
72,226 |
|
Robin Birchall |
33,997 |
- |
33,997 |
|
Russel Swarts |
113,400 |
- |
113,400 |
|
James Smith |
29,030 |
- |
29,030 |
|
Sarah Cope |
58,060 |
- |
58,060 |
|
David Minchin |
229,622 |
- |
229,622 |
|
Nigel Friend 1 |
29,030 |
- |
29,030 |
|
Lorna Blaisse 2 |
66,837 |
- |
66,837 |
|
|
632,202 |
|
632,202 |
|
|
Salaries and Fees |
Bonuses |
Total 30 June 2022 |
|
$ |
$ |
$ |
|
|
Ian Stalker |
80,296 |
- |
80,296 |
|
Robin Birchall |
34,047 |
- |
34,047 |
|
Russel Swarts |
130,699 |
- |
130,699 |
|
James Smith |
48,520 |
- |
48,520 |
|
Sarah Cope |
66,443 |
- |
66,443 |
|
David Minchin |
187,108 |
40,200 |
227,308 |
|
Nigel Friend 1 |
8,615 |
- |
8,615 |
|
|
555,728 |
40,200 |
595,928 |
1 Nigel Friend was appointed on 17 March 2022
2 Lorna Blaisse was appointed on 9 February 2023
The Directors of the Group are considered to be Key Management Personnel. No director was paid pension benefits in either year and there are no post-employment benefits, other long-term benefits or termination benefits outstanding.
Termination benefits
David Minchin received a termination fee of $42,063 and notice pay of $84,126 pursuant to a settlement agreement dated 8 February 2023
8. Finance income
|
|
30 June 2023 $ |
30 June 2022 $ |
|
|
|
|
|
Finance income |
38,447 |
- |
|
|
38,447 |
- |
Interest was earned on surplus funds that were placed in interest bearing accounts.
9. Taxation
|
|
30 June 2023 $ |
30 June 2022 $ |
|
Taxation expense |
|
|
|
Current tax |
6,376 |
- |
|
Deferred tax |
- |
- |
|
|
|
|
|
Total tax charge |
6,376 |
- |
|
|
|
|
|
Loss before tax |
(3,327,754) |
(13,356,151) |
|
Tax credit at the applicable rate of 21% (2022: 21%) |
698,828 |
2,804,792 |
|
Effects of: Expenditure not deductible for tax |
(125,517) |
(138) |
|
Losses carried forward not recognised as a deferred tax asset |
(566,935) |
(2,804,654) |
|
Tax charge |
6,376 |
- |
Tanzanian taxes were incurred during the period amounting to $6,376 (2022: $Nil).
The tax rate used is a weighted average of the standard rate of corporation tax in the UK being 19% and Tanzania being 30%. No deferred tax asset has been recognised in view of the uncertainty over the timing of future taxable profits against which the losses may be offset.
The Company has unused tax losses of approximately $5,698,850 (2022: $5,122,914) to carry forward and set against future profits. The related deferred tax asset has not been recognised in respect of these losses as there is no certainty regarding the level and timing of future profits.
10. Loss per share
The calculation for earnings per share (basic and diluted) is based on the consolidated loss attributable to the equity shareholders of the Company is as follows:
|
|
30 June 2023 $ |
30 June 2022 $ |
|
|
|
|
|
Loss attributable to equity shareholders |
3,334,130 |
13,356,151 |
|
|
|
|
|
Weighted average number of Ordinary Shares |
728,815,042 |
616,086,860 |
|
|
|
|
|
Loss per Ordinary Share ($/cents) |
(0.46) |
(2.17) |
Basic and diluted loss per share have been calculated by dividing the loss attributable to equity holders of the Company after taxation by the weighted average number of shares in issue during the year. Diluted loss per share has not been calculated as the options, warrants and loan notes have no dilutive effect given the loss arising in the year.
11. Intangible assets
Intangible assets comprise exploration and evaluation costs capitalised as at 30 June 2023 and 2022, less impairment.
|
|
Note |
30 June 2023 $ |
30 June 2022 $ |
|
Exploration & Evaluation Assets - Cost |
|
|
|
|
Opening balance |
|
11,758,362 |
13,061,285 |
|
Additions to exploration assets |
|
2,967,041 |
6,269,562 |
|
Capitalised directors' fees and employee wages |
7 |
507,265 |
526,351 |
|
Capitalised other expenses |
|
416,433 |
274,276 |
|
Equity Settled |
|
- |
260,965 |
|
Foreign exchange rate movements on intangible assets |
|
(38,783) |
(113,147) |
|
Total additions |
|
3,851,956 |
7,218,006 |
|
Impairment of intangibles |
|
(100,803) |
(8,520,929) |
|
Closing balance |
|
15,509,515 |
11,758,362 |
Exploration projects in Tanzania are at an early stage of development and no resource estimates are available to enable value in use calculations to be prepared.
In accordance with IFRS 6, the Directors undertook an assessment of the following areas and circumstances that could indicate the existence of impairment which included the following:
· The Group's right to explore in an area has expired or will expire soon without renewal.
· No further exploration or evaluation is planned or budgeted for.
· A decision has been taken by the Board to discontinue exploration and evaluation in an area due to the absence of a commercial level of reserves; and
· Sufficient data exists to indicate that the book value will not be fully recovered from future development and production.
Following an unsuccessful attempt to secure a rig for the drilling of the Tai C well, certain costs were incurred and these costs amounting to $100,803 have subsequently been impaired. The 2022 charge of $8,520,929 reflected impairment charges on relinquished licences.
12. Property, plant and equipment
|
|
|
Field Equipment |
Office equipment |
Total |
|
|
|
$ |
$ |
$ |
|
Cost |
|
|
|
|
|
As at 1 July 2021 |
|
71,087 |
22,962 |
94,049 |
|
|
|
|
|
|
|
Additions |
|
- |
7,404 |
7,404 |
|
Foreign exchange movements |
|
(460) |
- |
(460) |
|
As at 30 June 2022 |
|
70,627 |
30,366 |
100,993 |
|
|
|
|
|
|
|
Additions |
|
- |
4,668 |
(7,057) |
|
Scrapped |
|
- |
(11,725) |
- |
|
As at 30 June 2023 |
|
70,627 |
23,309 |
93,936 |
|
|
|
|
|
|
|
Accumulated depreciation |
|
|
|
|
|
As at 1 July 2021 |
|
(70,627) |
(17,710) |
(88,337) |
|
|
|
|
|
|
|
Charge for the year |
|
- |
(4,896) |
(4,896) |
|
As at 30 June 2022 |
|
(70,627) |
(22,606) |
(93,233) |
|
|
|
|
|
|
|
Charge for the year |
|
- |
(6,817) |
(6,817) |
|
Scrapped |
|
- |
11,725 |
11,725 |
|
As at 30 June 2023 |
|
(70,627) |
(17,698) |
(88,325) |
|
|
|
|
|
|
|
Carrying Amount |
|
|
|
|
|
At 30 June 2022 |
|
- |
7,760 |
7,760 |
|
At 30 June 2023 |
|
- |
5,611 |
5,611 |
The Group's property, plant and equipment are free from any mortgage or charge.
13. Inventory
|
|
|
30 June 2023 |
30 June 2022 |
|
|
|
$ |
$ |
|
Inventory at cost |
|
628,025 |
224,879 |
|
Inventory in transit |
|
966,215 |
- |
|
Less impairment |
|
(116,486) |
(107,270) |
|
Exchange Gain |
|
(1,392) |
269 |
|
Net realisable value |
|
1,476,362 |
117,878 |
Inventory comprises drill rods and drilling chemicals used in the previous drilling campaign.
14. Trade and other receivables
Non-current other receivables are as follows:
|
|
|
30 June 2023 |
30 June 2022 |
|
|
|
$ |
$ |
|
VAT receivable |
|
1,231,593 |
1,210,352 |
In 2020, VAT receivable was reclassified as a non-current asset as the amounts will only become receivable when reviewed and agreed by the Tanzanian Revenue Authority in accordance with VAT legislation but this is not estimated to occur in the next 12-month period. Non-current receivables were not discounted as the impact of any discounting, is considered to be immaterial to the Financial Statements.
Other receivables are as follows:
|
|
|
30 June 2023 |
30 June 2022 |
|
Prepayments |
|
$ 2,166,075 |
$ 481,236 |
|
Other receivables |
|
72,019 |
163,100 |
|
|
|
2,238,094 |
644,336 |
Prepayments include an amount of $1,369,081 for drill casings (2022: $371,381) and $Nil for drilling equipment (2022: $65,080) to be used in the upcoming drilling campaign. Other receivables comprise VAT refunds to be submitted.
15. Cash and cash equivalents
|
|
|
30 June 2023 |
30 June 2022 |
|
|
|
$ |
$ |
|
Cash and cash equivalents |
|
9,600,786 |
4,906,153 |
Included within cash and cash equivalents of $9.6 million, was a sum of approximately $2.1 million held in escrow at 30 June 2023 in contemplation of the completion of a sale and purchase transaction which was non-binding at the Balance Sheet date. Subsequent to 30 June 2023, the transaction was completed and the funds utilised.
16. Trade and other payables
|
|
30 June 2023 |
30 June 2022 |
|
|
$ |
$ |
|
Trade payables |
2,428,250 |
219,624 |
|
Accruals |
293,373 |
331,703 |
|
Other creditors |
135,534 |
59,946 |
|
|
2,857,157 |
611,273 |
Trade payables have shown a significant increase in the current year which reflects the commencement of a drilling campaign.
17. Share premium
|
|
Number of shares |
Ordinary shares $ |
Total $ |
|
As at 30 June 2021 |
615,498,925 |
44,118,986 |
44,118,986 |
|
Share issue costs |
|
(1,458,273) |
(1,458,273) |
|
Issued and fully paid as at 30 June 2021 |
615,498,925 |
42,660,713 |
42,660,713 |
|
|
|
|
|
|
Issue of new shares - 18 January 2022 (1) |
100,000 |
3,857 |
3,857 |
|
Issue of new shares - 21 January 2022 (2) |
211,864 |
10,191 |
10,191 |
|
Issue of new shares - 1 March 2022 (3) |
182,394 |
6,953 |
6,953 |
|
Issue of new shares -27 May 2022 (4) |
1,560,229 |
55,946 |
55,946 |
|
Issue of new shares - 30 May 2022 (5) |
1,990,000 |
250,000 |
250,000 |
|
Issue of new shares - 30 May 2022 (6) |
87,284 |
10,965 |
10,965 |
|
Issue of new shares - 10 June 2022 (7) |
1,760,563 |
62,693 |
62,693 |
|
Movement for 2022 |
5,892,334 |
400,605 |
400,605 |
|
|
|
|
|
|
|
|
|
|
|
As at 30 June 2022 |
621,391,259 |
43,061,318 |
43,061,318 |
|
Issue of new shares for warrants exercised |
965,027 |
31,669 |
31,669 |
|
Issue of new shares - 20 October 2022 (8) |
880,282 |
28,031 |
28,031 |
|
Issue of new shares - 30 November 2022 (9) |
84,745 |
3,638 |
3,638 |
|
Issue of new shares - 15 December 2022 (10) |
197,922,716 |
12,018,934 |
12,018,934 |
|
Movement for 2023 |
198,887,743 |
12,050,603 |
12,050,603 |
|
|
|
|
|
|
Issued and fully paid at 30 June 2023 |
820,279,002 |
56,570,194 |
56,570,194 |
|
Share issue costs |
|
(2,101,958) |
(2,101,958) |
|
|
|
|
|
|
|
820,279,002 |
54,468,236 |
54,468,236 |
|
|
|
|
|
|
|
|
30 June |
30 June |
|
|
|
2023 |
2022 |
|
|
|
$ |
$ |
|
|
|
|
|
|
Movement in share issue costs |
|
|
|
|
Opening balance |
|
1,458,273 |
1,458,273 |
|
Current year costs |
|
643,685 |
- |
|
As at 30 June |
|
2,101,958 |
1,458,273 |
All shares issued are issued at no par value. All new shares issued will rank pari passu with the existing ordinary shares in issue.
(1) On 18 January 2022, the Company issued 100,000 new ordinary shares in the Company for warrants exercised at a price of 2.84p for a value of (£2,840) $3,857.
(2) On 21 January 2022, the Company issued 211,864 new ordinary shares in the Company for warrants exercised at a price of 3.554p for a value of (£7,521) $10,191.
(3) On 1 March 2022, the Company issued 182,394 new ordinary shares in the Company for warrants exercised at a price of 2.84p for a value of (£5,180) $6,953.
(4) On 27 May 2022, the Company issued 1,560,229 new ordinary shares in the Company for warrants exercised at a price of 2.84p for a value of (£44,310) $55,946.
(5) On 30 May 2022, the Company issued 1,999,000 new ordinary shares in the Company to a service provider at a price of 10.00p for a value of (£199,000) $250,000.
(6) On 30 May 2022, the Company issued 87,284, new ordinary shares in the Company to a service provider at a price of 10.00p (£8,728) $10,965.
(7) On 10 June 2022, the Company issued 1,760,563 new ordinary shares in the Company for warrants exercised at a price of 2.84p for a value of (£50,000) $62,693.
(8) On 20 October 2022, the Company issued 880,282 new ordinary shares in the Company for warrants exercised at a price of 2.84p for a value of (£25,000) $28,031
(9) On 30 November 2022, the Company issued 84,745 new ordinary shares in the Company for warrants exercised at a price of 3.55p for a value of (£3,008) $3,638
(10) On 15 December 2022, the Company raised gross proceeds of £9,896,135 ($12,018,934) through the placing of 197,922,716 new ordinary shares in the Company at a price of 5.00p per share.
18. Share-based payments
Under IFRS 2, an expense is recognised in the statement of comprehensive income for equity settled share-based payments, at the fair value at the date of grant. If this payment relates directly to the cost of raising funds through the issue of shares, then it is debited against the share premium reserve. The share-based payments were all valued using the Black-Scholes Pricing Model.
The Group has a share option scheme that entitles key management personnel to purchase shares at the market price of the shares at grant date. Currently, these schemes are limited to key management personnel and certain key contractors. The vesting conditions are as set out in the Report of the Directors. The share-based payments debited to the Share Premium account all related to share options issued to Directors and key management personnel.
No warrants were granted during the year that were determined as equity instruments under IAS 32.
The application of IFRS 2 gave rise to the following share-base payments:
|
|
2023 |
2022 |
|
|
$ |
$ |
|
Share-based payments |
808,760 |
3,327,911 |
|
Warrants exercised |
(18,071) |
(448,412) |
|
Options expired |
(146,480) |
(18,980) |
|
|
644,209 |
2,860,519 |
The following table sets out the movements of warrants and options during the year:
|
|
2023 |
2023 |
2022 |
2022 |
|
|
Warrants and Options |
Weighted average exercise price $ |
Warrants and Options |
Weighted average exercise price $ |
|
Outstanding at the beginning of the year |
67,882,138 |
0.13 |
70,154,090 |
0.24 |
|
Granted during the year |
8,000,000 |
0.08 |
6,000,000 |
0.18 |
|
Exercised during the year |
(965,027) |
0.35 |
(3,815,050) |
0.04 |
|
Expired during the year |
(12,395,005) |
0.254 |
(1,156,902) |
0.305 |
|
Lapsed during the year |
(2,000,000) |
0.16 |
(3,300,000) |
0.18 |
|
Outstanding at the end of the year |
60,522,106 |
0.11 |
67,882,138 |
0.13 |
The warrants and options outstanding at 30 June 2023 had an exercise price in the range of $0.04 to $0.305 (2022: range of $0.04 to $0.305) and a weighted-average contractual life of 6.55 years (2022: 5.81 years). The warrants exercised during the year were at an exercise price of $0.03 - $0.04 (2.84 pence - 3.55 pence) - see note 18 for further breakdown.
The share price at the time of exercise of the warrants and options was an average of $0.076 (£0.061) (2022: $0.25, £0.196), ranging from $0.0794-$0.106 (£0.0635-£0.085).
Measurement of fair values on Equity-settled share-based payment arrangements
The fair value of the employee share options has been calculated using the Black-Scholes formula. Service and non-market performance conditions attached to the arrangements were not considered in measuring fair value.
The inputs used in the measurement of the fair values at grant date of the equity-settled share-based payments were as
follows:
|
|
Award 09 09 2020 |
Award 29 09 2020 |
Award 04 12 2020 (1) |
Award 04 12 2020 (2) |
Award 04 12 2020 (3) |
Award 04 12 2020 (4) |
|
Fair value at grant date |
0.025 |
0.028 |
0.013 |
0.03 |
0.025 |
0.024 |
|
Share price at grant date |
0.038 |
0.038 |
0.037 -0.038 |
0.038 |
0.038 |
0.038 |
|
Exercise price |
0.035 |
0.035 |
0.045-0.3 |
0.038 |
0.04,0.05 |
0.04 & 0.11 |
|
Expected volatility |
76% |
76% |
76% |
76% |
76% |
76% |
|
Expected life years |
3 |
4 |
4 |
5 |
1.5 |
1 |
|
Expected dividend yield |
- |
- |
- |
- |
- |
- |
|
Risk-free interest rate |
0.32% |
0.32% |
0.32% |
0.32% |
0.32% |
0.32% |
|
|
|
|
|
|
|
|
|
|
Award 08 12 2020 |
Award 24 01 2020 |
Award 15 04 2021 |
Award 21 06 2021 |
Award 16 02 2022 |
Award 23 02 2023 |
|
Fair value at grant date |
0.03 |
0 |
0.245 |
0.253 |
0.56 |
.54 |
|
Share price at grant date |
0.038 |
0 |
0.161 |
0.257 |
0.1085 |
.54 |
|
Exercise price |
0.11 & 0.038 |
0.038 |
0.188 & 0.112 |
0.296 & 0.134 |
0.1747 |
.0756 |
|
Expected volatility |
76% |
87.70% |
76% |
76% |
55% |
77% |
|
Expected life years |
5 |
3 |
2 |
10 |
9 |
9 |
|
Expected dividend yield |
- |
- |
- |
- |
- |
- |
|
Risk-free interest rate |
0.32% |
0.32% |
0.32% |
0.32% |
1.53% |
3.57% |
The risk-free rate of return is based on zero yield government bonds for a term consistent with the option life. Expected volatility was determined by reviewing benchmark value from comparator companies.
The Company has issued the following warrants and options, which are still in force at the balance sheet date:
|
Grant date |
Number of warrants and options |
Expiry date |
Exercise price $ per share |
|
9 September 2020 |
1,000,000 |
9 September 2023 |
0.035 |
|
29 September 2020 |
9,000,000 |
30 September 2024 |
0.035 |
|
4 December 2020 |
22,046,950 |
3 December 2025 |
0.0344 |
|
4 December 2020 |
1,275,156 |
15 September 2023 to 20 October 2024 |
0.043-0.286 |
|
21 June 2021 |
3,000,000 |
20 June 2031 |
0.1271 |
|
21 June 2021 |
15,200,000 |
20 June 2031 |
0.279 |
|
16 February 2022 |
1,000,000 |
15 February 2032 |
0.165 |
|
23 February 2023 |
8,000,000 |
23 February 2033 |
.0794 |
|
|
60,522,106 |
|
|
There are 60,522,106 (2022: 67,882,138) options/warrants exercisable at year end. An amount of $808,760 (2022: $3,327,911) was charged against the share option reserve.
19. Other reserves
|
Merger reserve |
30 June 2023 |
30 June 2022 |
|
|
$ |
$ |
|
Opening balance |
(349,710) |
(349,710) |
|
Reversal on deregistration |
349,710 |
- |
|
As at 30 June |
- |
(349,710) |
The merger reserve arose on the acquisition of CJT Ventures Limited. This entity was deregistered during the course of the year and as such, this reserve has been eliminated.
|
Foreign currency reserve |
30 June 2023 $ |
30 June 2022 $ |
|
Opening balance |
(911,337) |
(36,282) |
|
Movement |
661,215 |
(875,055) |
|
As at 30 June |
(250,122) |
(911,337) |
|
Share option reserve |
2023 $ |
2022 $ |
|
Opening balance |
3,848,395 |
987,876 |
|
Share based payments |
808,760 |
3,327,911 |
|
Warrants expired |
(146,480) |
(467,392) |
|
Warrants exercised |
(18,071) |
- |
|
As at 30 June |
4,492,604 |
3,848,395 |
|
|
|
|
|
Total Other Reserves |
4,242,482 |
2,587,348 |
20. Financial Instruments
Capital risk management
The Group's objective when managing capital is to safeguard the entity's ability to continue as a going concern and develop its mineral exploration and development and other activities to provide returns for shareholders and benefits for other stakeholders.
The Group's capital structure comprises all the components of equity (all share capital, share premium, retained earnings when earned and other reserves). When considering the future capital requirements of the Group and the potential to fund specific project development via debt, the Directors consider the risk characteristics of the underlying assets in assessing the optimal capital structure.
The Group's activities expose it to a variety of financial risks: market risk (including foreign currency risk and price risk), credit risk and liquidity risk. The Group's overall risk management programme focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the Group's financial performance.
Fair value of financial instruments
The fair values of the Company's financial instruments on 30 June 2023 and 30 June 2022 did not differ materially from their carrying values.
The Group measures fair values using the following fair value hierarchy that reflects the significance of the inputs used in making the measurements:
· Level 1 fair value measurements are those derived from inputs other than quoted prices that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).
· Level 2 fair value measurements are those derived from valuation techniques that include inputs for the asset or liability that are not based on observable market data (unobservable inputs).
· Level 3 assets are assets whose fair value cannot be determined by using observable inputs or measures, such as market prices or models. Level 3 assets are typically very illiquid, and fair values can only be calculated using estimates or risk-adjusted value ranges.
Market risk
Market risk arises from the Group's use of interest bearing and foreign currency financial instruments. It is the risk that future cash flows of a financial instrument will fluctuate because of changes in interest rates (interest rate risk), and foreign exchange rates (currency risk). No such instruments are held by the Group and therefore no risk has been identified.
Price risk
Price risk arises from the exposure to equity securities arising from investments held by the Group. No such investments are held by the Group and therefore no risk has been identified.
Foreign exchange risk
The Group operates internationally and is exposed to foreign exchange risk arising from various currency exposures, primarily with respect to the Pound sterling, US Dollar and Tanzanian Shilling. Foreign exchange risk arises from recognised monetary assets and liabilities, where they may be denominated in a currency that is not the Group's functional currency. While the Tanzanian Shilling has depreciated since 1 July 2022 (from 1 TZS = 0.000430 USD to 1 TZS = 0.000397 USD) the Tanzanian Shilling risk is mitigated by the fact that Helium One would only have one month's cash requirement on hand at any one time and this is usually held in US Dollars. Another significant risk in Tanzania is a US Dollar risk as the loans to Tanzanian subsidiaries are denominated in US Dollars. The Directors consider that, for the time being, no hedging or other arrangements are necessary to mitigate this risk.
On the assumption that all other variables were held constant, and in respect of the Group and the Company's expenses the potential impact of a 20% increase/decrease in the USD: Tanzanian Shilling foreign exchange rate on the Group's loss for the year and on equity is as follows:
|
|
30 June 2023 |
30 June 2022 |
|
Increase/(decrease) in USD/ TzSh |
|
|
|
20% |
195,621 |
87,085 |
|
-20% |
(195,621) |
(87,085) |
Credit risk
Credit risk is the risk that the Group will suffer a financial loss as a result of another party failing to discharge an obligation and arises from cash and other liquid investments deposited with banks and financial institutions. The Group considers the credit ratings of banks in which it holds funds to reduce exposure to credit risk. The Group will only keep its holdings of cash and cash equivalents with institutions which have a minimum credit rating of 'BBB'.
Whilst the cash holdings are deposited with institutions in terms of the policy, the Group considers that it is not exposed to any significant increases in credit risk and no Expected Credit Loss has been recognised.
The Group considers that it is not exposed to major concentrations of credit risk.
The Group holds cash as a liquid resource to fund its obligations. The Group's cash balances are held primarily in US Dollars. The Group's strategy for managing cash is to assess opportunity for interest income whilst ensuring cash is available to match the profile of the Group's expenditure. This is achieved by regular monitoring of interest rates and monthly review of expenditure forecasts. Short term interest rates on deposits have for the fiscal year been very unattractive.
The Group has a policy of not hedging and therefore takes market rates in respect of foreign exchange risk; however, it does review its currency exposures on an ad hoc basis. Currency exposures relating to monetary assets held by foreign operations are included within the foreign exchange reserve in the Group Balance Sheet.
The currency profile of the Group's cash and cash equivalent is as follows:
|
|
30 June 2023 |
30 June 2022 |
|
Cash and cash equivalents |
$ |
$ |
|
US Dollar |
8,743,568 |
3,709,922 |
|
GBP |
852,248 |
1,184,601 |
|
Tanzanian Shillings |
4,970 |
11,630 |
On the assumption that all other variables were held constant, and in respect of the Group's cash position, the potential impact of a 20% increase in the GBP: USD foreign exchange rate would not have a material impact on the Group's cash position and as such is not disclosed.
Liquidity risk
Liquidity risk arises from the possibility that the Group and its subsidiaries might encounter difficulty in settling its debts or otherwise meeting its obligations related to financial liabilities. In addition to equity funding, additional borrowings have been secured in the past to finance operations. The Company manages this risk by monitoring its financial resources and carefully plans its expenditure programmes. Financial liabilities of the Group comprise trade payables which mature in less than six months.
Interest rate risk
The Group has no material exposure to interest rate risk.
21. Categories of financial instruments
In terms of financial instruments, these solely comprise of those measured at amortised costs and are as follows:
|
|
30 June 2023 $ |
30 June 2022 $ |
|
Liabilities at amortised cost |
2,857,156 |
611,273 |
|
|
|
|
|
Cash and cash equivalents at amortised cost |
9,600,786 |
4,906,153 |
|
Financial assets at amortised cost |
1,303,612 |
1,373,452 |
|
|
10,904,398 |
6,279,605 |
22. List of subsidiaries
At 30 June 2023, the Group consists of the following subsidiaries:
|
Name of subsidiary |
Country of incorporation |
Principal place of business |
Share capital held by Ultimate Parent |
Share capital held by Group |
Principal activities |
|
Black Swan Resources Ltd |
BVI |
BVI |
100% |
100% |
Holding |
|
Helium One (Stahamili) Ltd |
Tanzania |
Tanzania |
Nil |
99% |
Helium Exploration |
|
Helium One (Njozi) Ltd |
Tanzania |
Tanzania |
Nil |
99% |
Helium Exploration |
|
Helium One (Gogota) Ltd |
Tanzania |
Tanzania |
Nil |
99% |
Helium Exploration |
|
Helium One Holdings Ltd |
Mauritius |
Mauritius |
100% |
100% |
Holding |
|
Helium One Treasury Ltd |
BVI |
BVI |
100% |
100% |
Holding |
|
Helium One (UK) Limited* |
UK |
UK |
Nil |
100% |
Administration Services |
|
Northcote Energy Ltd* |
Cayman |
Cayman |
Nil |
100% |
Holding |
|
Northcote Energy USA Inc* |
USA |
USA |
Nil |
100% |
Dormant |
|
Attis Oil and Gas Management LLC* |
USA |
USA |
Nil |
100% |
Dormant |
|
|
|
|
|
|
|
Black Swan Resources Limited holds 99% of Helium One (Stahamili) Ltd, Helium One (Gogota) Ltd and Helium One (Njozi) Ltd. The remaining 1% is held on trust for the Company. This is due to Tanzanian law stating that a company must have a minimum of two shareholders.
* These companies were acquired on 4 December 2020
Helium One Holdings was incorporated in Mauritius on 23 May 2022 and has acquired 100% of the shares in Black Swan Resources Limited.
CJT Ventures Limited has been wound up and was issued with a Strike Off Notice on 1 May 2023.
23. Commitments
The Group currently has an interest in 16 licences in Tanzania after relinquishment of two licences. These are initially granted for a period of four years with the option to extend on first renewal for further three years and second renewal of a further two years. Licence areas PL10711/2015 and PL10728/2015 measuring 585 square kilometres were fully relinquished during the year. There were 6 other licences areas which were partially relinquished and measuring 964 square kilometres. All of these relinquishments were fully impaired to the extent of $8,520,929 in the prior financial year.
These licences include commitments to pay licence fees and minimum spending requirements. There is no legal obligation to pay these licence fees, but it is a condition of retaining the licences. As at 30 June 2023 these are as follows:
|
|
30 June 2023 |
30 June 2023 |
30 June 2023 |
|
|
Licence fees $ |
Minimum spend $ |
Total $ |
|
Not later than one year |
592,438 |
296,219 |
888,657 |
|
Later than one year but less than 5 years |
212,052 |
106,026 |
318,078 |
|
More than 5 years |
- |
- |
- |
|
Total |
804,490 |
402,245 |
1,206,735 |
|
|
|
|
|
|
|
30 June 2022 |
30 June 2022 |
30 June 2022 |
|
|
Licence fees $ |
Minimum spend $ |
Total $ |
|
Not later than one year |
866,947 |
451,123 |
1,318,070 |
|
Later than one year but less than 5 years |
804,490 |
402,245 |
1,206,735 |
|
More than 5 years |
- |
- |
- |
|
|
1,671,437 |
853,368 |
2,524,805 |
24. Operating leases
The Group had no operating leases in either year.
25. Related parties
A. Parent and ultimate controlling party
There is no ultimate controlling party.
B. Transactions with key management personnel and transactions
Key management personnel compensation and transactions are disclosed in note 7.
C. Other related party transactions
Other related party transactions were in respect of transactions with other group companies and have been eliminated on consolidation.
Other transactions
Promaco Limited, a limited company of which Ian Stalker is a director, was paid a fee of $72,226 (2022: $80,296) for director services to the Company. The balance outstanding at year end was $24,900 (2022: $Nil).
All related party transactions took place at arm's length.
26. Reconciliation of movement in debt position
|
|
|
|
Non cash changes |
|
||
|
|
At 30 June 2022 |
Cash flows |
Foreign exchange movements |
Interest charged |
Bonds converted to equity |
At 30 June 2023 |
|
|
$ |
$ |
$ |
$ |
$ |
$ |
|
Cash and Cash equivalents |
|
|
|
|
|
|
|
Cash |
4,906,153 |
4,830,512 |
(135,879) |
- |
- |
9,600,786 |
|
TOTAL |
4,906,153 |
4,830,512 |
(135,879) |
|
|
9,600,786 |
|
|
|
|
Non cash changes |
|
||
|
|
At 30 June 2021 |
Cash flows |
Foreign exchange movements |
Interest charged |
Bonds converted to equity |
At 30 June 2022 |
|
|
$ |
$ |
$ |
$ |
$ |
$ |
|
Cash and Cash equivalents |
|
|
|
|
|
|
|
Cash |
15,802,111 |
(10,581,374) |
(314,584) |
- |
- |
4,906,153 |
|
TOTAL |
15,802,111 |
(10,581,374) |
(314,584) |
- |
- |
4,906,153 |
27. Post balance sheet events
On 10 July 2023, the Company announced the acquisition of the Epiroc Predator 220 drilling rig.
On 11 July 2023, the company issued 587,457 Ordinary Shares in the Company to a service provider in lieu of cash payment.
On 18 July 2023, the company issued 450,000 Ordinary Shares pursuant to the exercise of warrants.
On 7 August 2023, the company issued 6,000,000 Ordinary Shares pursuant to the exercise of options and issued 56,638 Ordinary Shares to a service provider in lieu of cash.
On 7 September 2023, the Company announced that it had raised gross proceeds of £6.3 million before expenses (approximately $7.875 million) in a placing and subscription through the issue of an aggregate of 105,000,000 new ordinary shares at a price of 6 pence per new ordinary share. Additionally, the Company raised £500,000 (approximately $625,000) through a Retail Offer via PrimaryBid through the issue of 8,333,333 new ordinary shares at 6p per new ordinary share. The Company also issued 750,000 Ordinary Shares at 6p per new ordinary share in in lieu of certain advisory fees.
On 12 September 2023, the Company announced the issue of 1 million new ordinary shares pursuant to the exercise of options.
On 25 September 2023, the Company announced that drilling had commenced at the Tai 3 well at the Rukwa project in Tanzania.
Since 12 September 2023, the Company has issued a further 11,275,000 new ordinary shares pursuant to the exercise of options.
28. Foreign Currency Reserve Adjustment
During the year ended 30 June 2022, the Group changed the functional currency of Helium One UK Limited from Pound Sterling to US Dollars in order to align this entity with the Group. As a consequence, the inter-company loan accounts were revalued and aligned. This decision was made after the Group audit had been completed. In order to reflect this in the consolidated Financial Statements, an amount of $721,237 has been recorded in the current year within retained earnings and the foreign currency reserve in order to correct the brought forward position. The prior year Financial Statements have not been retrospectively restated on the basis that this is not considered material.
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