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Petro Matad Ltd (MATD)

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Tuesday 03 September, 2019

Petro Matad Ltd

Half-year Report

RNS Number : 0182L
Petro Matad Limited
03 September 2019
 

Petro Matad Limited

('Petro Matad' or the 'Company')

Interim results for the six months ended 30 June 2019

LONDON, 3 September 2019: Petro Matad Limited, the AIM quoted Mongolian oil explorer, announces its unaudited interim results for the six months ended 30 June 2019.

Financial Summary

The Group posted a loss of USD 4.41 million for the six-month period ended 30 June 2019, which compares to a loss of USD 6.65 million for the comparable period in 2018. The Company's cash balance at 30 June 2019 was USD 16.12 million (USD 3.79 million in cash and USD 12.33 million in Financial Assets), which compares to a cash balance of USD 15.55 million (USD 12.54 million in cash and USD 3.01 million in Financial Assets) on 30 June 2018.

Following the two successful placings in 2018, no new fund raises have been undertaken in 2019 as the Company's cash resources are sufficient to fully meet the costs of the planned 2019 drilling programme.

 

Operational Update

 

The Heron 1 exploration well in the Tamsag Basin of Block XX spudded with the DQE International 40105 rig on 19 July 2019. Land permits for Heron (and Gazelle) have been received and drilling operations continue towards a planned total depth (TD) of 3,050 metres. The well is an appraisal of the T19-46 oil field immediately to the north in Block XIX and is targeting a prospect with 25 MMbo of Mean Prospective Recoverable Resource. The Company expects to be in a position to announce the results of the drilling and logging of the well during the week commencing 9 September 2019.

 

The Gazelle 1 exploration well will follow Heron 1 after a six-kilometre rig move and will take approximately 35 days to drill and log. The planned TD is 2,500 metres and the Gazelle Prospect has an estimated Mean Prospective Recoverable Resource of 13 MMbo. Gazelle 1 is located updip of Petro China's T19-46-1 oil well on the western flank of the Tamsag Basin which is the primary source kitchen for the fields in Block XIX.

 

The Red Deer 1 exploration well in the Asgat Sag Basin of Block XX spudded with the Daton Petroleum Engineering and Oilfield Service LLC rig, DXZ1, on 4 August 2019. The well is targeting a prospect with 48 MMbo of Mean Prospective Recoverable Resource. Drilling operations continue towards the planned TD of 2,100 metres. Results from the drilling and logging of the well are expected to be completed by mid-September 2019.

 

In the event of a discovery in one or more of the 2019 exploration wells, the Company will bring in a separate rig for testing. A call-off testing contract has been signed, which ensures testing operations, if warranted, can commence soon after discovery. 

 

The Company successfully obtained two-year PSC extensions for Blocks IV and V, as was announced on 26 June 2019.

Further operational updates will be provided in due course.

-Ends -

 

Further information please contact:

 

Petro Matad Limited

 

Mike Buck, CEO

+976 7014 1099 / +976 7575 1099

 

 

Shore Capital (Nominated Adviser and Broker)

Richard Johnson

Andy Crossley

Toby Gibbs

+44 (0) 20 7408 4090

 

Stifel Nicolaus Europe Limited (Broker)

 

Callum Stewart

Nicholas Rhodes

Ashton Clanfield

+44 (0) 20 7710 7600

 

FTI Consulting (Communications Advisory Firm)

Sara Powell

Ben Brewerton

+44 (0) 20 3727 1000

 

 All Reserves and Resources definitions and estimates shown in this report are based on the SPE/AAPG/WPC/SPEE Petroleum Resource Management System ("PRMS").

Technical information in this news release has been reviewed by the Company's Exploration Manager, Mr. Jerry Smart. He has 37 years of industry experience in oil and gas exploration and production with LASMO, Eni, Salamander Energy and Ophir Energy. He holds a B.Sc. in Geology from King's College, London.

Glossary

 

 

MMbo                                             Million barrels of oil

Mean                                      The arithmetic average of the low, mid and high case estimates of recoverable prospective resources

Prospective Resources                 Estimated volumes associated with undiscovered accumulations. These represent quantities of petroleum which are estimated, as of a given date, to be potentially recoverable from oil and gas deposits identified on the basis of indirect evidence but which have not yet been drilled

TD                                                    Total Depth

 

About Petro Matad

Petro Matad is the parent company of a group focussed on oil exploration, as well as future development and production in Mongolia. At the current time, Petro Matad holds 100% working interest and the operatorship of three Production Sharing Contracts with the Government of Mongolia. Block XX has an area of 10,367 square kilometres in the far eastern part of the country, and Blocks IV and V have an area of 29,062 square kilometres and 21,143 square kilometres, respectively, in the central western part of the country.

Petro Matad Limited is incorporated in the Isle of Man under company number 1483V. Its registered office is at Victory House, Prospect Hill, Douglas, Isle of Man, IM1 1EQ. 

 

 

STATEMENT OF COMPREHENSIVE INCOME

FOR THE HALF-YEAR ENDED 30 JUNE 2019

 

 

 

 

              Consolidated

 

 

30 Jun 2019

30 Jun 2018

 

 

$'000

$'000

 

 

 

 

Continuing Operations

 

 

 

Revenue

 

 

 

Interest Income

 

508

180

Other Income

 

2

5

 

 

510

185

 

 

 

 

Expenditure

 

 

 

Consultancy fees

 

(62)

(63)

Depreciation and amortisation

 

(101)

(144)

Employee benefits expenses

 

(1,510)

(2,072)

Exploration expenditure

 

(2,152)

(2,870)

Other expenses

 

(1,091)

(1,690)

Profit/(Loss) from continuing operations before income tax

 

(4,406)

(6,654)

Income tax expense

 

-

-

Profit/(Loss) from continuing operations after income tax

 

(4,406)

(6,654)

Net Loss

 

(4,406)

(6,654)

 

 

 

 

Other comprehensive income/(loss)

 

 

 

Exchange rate differences on translating foreign operations

 

(1)

(30)

Other comprehensive income/(loss), net of income tax

 

(1)

(30)

Total comprehensive loss

 

(4,407)

(6,684)

 

 

 

 

Profit/(Loss) attributable to owners of the parent

 

(4,406)

(6,654)

 

 

 

 

Total comprehensive income/(loss) attributable to owners of the parent

 

(4,407)

(6,684)

 

 

 

 

Earnings/(loss) per share (cents per share)

 

 

 

-       Basic and diluted earnings/(loss) per share

 

(0.67)

(1.38)

 

 

 

STATEMENT OF FINANCIAL POSITION

AS AT 30 JUNE 2019

 

                                Consolidated

 

30 Jun 2019

31 Dec 2018

30 Jun 2018

 

$'000

$'000

$'000

ASSETS

 

 

 

Current Assets

 

 

 

Cash and cash equivalents

3,790

2,111

12,542

Trade and other receivables

42

9

12

Prepayments

220

202

226

Financial assets

12,334

19,161

3,010

Inventory

205

213

216

Total Current Assets

16,591

21,696

16,006

 

 

 

 

Non-Current Assets

 

 

 

Exploration and evaluation

15,275

15,275

15,275

Property, plant and equipment

319

340

476

Total Non-Current assets

15,594

15,615

15,751

TOTAL ASSETS

32,185

37,311

31,757

 

 

 

 

LIABILITIES

 

 

 

Current liabilities

 

 

 

Trade and other payables

477

1,286

939

Total Current Liabilities

477

1,286

939

TOTAL LIABILITIES

477

1,286

939

NET ASSETS

31,708

36,025

30,818

 

 

 

 

EQUITY

 

 

 

Issued capital

143,174

143,174

126,098

Reserves

2,579

2,660

2,942

Accumulated losses

(114,045)

(109,809)

(98,222)

TOTAL EQUITY

31,708

36,025

30,818

 

 

CONDENSED CASH FLOW STATEMENT

FOR THE HALF-YEAR ENDED 30 JUNE 2019

 

 

Consolidated

 

30 Jun 2019

30 Jun 2018

 

$'000

$'000

 

 

 

Cash flows from operating activities

 

 

Payments to suppliers and employees

(5,568)

(8,510)

Interest received

508

180

Net cash flows from/(used in) operating activities

(5,060)

(8,330)

 

 

 

Cash flows from operating activities

 

 

Purchase of property, plant and equipment

(87)

(42)

Proceeds of financial assets

6,827

-

Proceeds from the disposal of plant and equipment

-

4

Net cash flows from/(used in) investing activities

6,740

(38)

 

 

 

Cash flows from financing activities

 

 

Proceeds from issue of shares

-

15,985

Capital raising costs

-

(218)

Net cash flows from/(used in) financing activities

-

15,767

 

 

 

Net increase/(decrease) in cash and cash equivalents

1,680

7,399

Net foreign exchange differences

(1)

53

Cash and cash equivalents at beginning of period

2,111

5,090

Cash and cash equivalents at end of period

3,790

12,542

 

 

STATEMENT OF CHANGES IN EQUITY

FOR THE HALF-YEAR ENDED 30 JUNE 2019

 

Consolidated

 

Attributable to equity holders of the parent

 

 

Issued Capital

$'000

 

Accumulated Losses

$'000

 

Other

Reserves $'000

 

 

Total

$'000

 

 

 

 

 

As at 1 January 2018

109,769

(91,679)

2,980

21,070

Income/(Loss) for the period

-

(6,654)

-

(6,654)

Other comprehensive income

-

-

(30)

(30)

Total comprehensive income/(loss) for the period

109,769

(98,333)

2,950

14,386

Transactions with owners in their capacity as owners

 

 

 

 

Issue of share capital

16,895

-

-

16,895

Cost of capital raising

(1,081)

-

-

(1,081)

Share based payments

515

111

(8)

618

As at 30 June 2018

126,098

(98,222)

2,942

30,818

 

 

 

 

 

 

 

 

 

 

As at 1 January 2019

143,174

(109,809)

2,660

36,025

Income/(Loss) for the period

-

(4,406)

-

(4,406)

Other comprehensive income

-

-

(1)

(1)

Total comprehensive income/(loss) for the period

143,174

(114,215)

2,659

31,618

Transactions with owners in their capacity as owners

 

 

 

 

Issue of share capital

-

-

-

-

Cost of capital raising

-

-

-

-

Share based payments

-

170

(80)

90

As at 30 June 2019

143,174

(114,045)

2,579

31,708

1.   CORPORATE INFORMATION

 

The financial report covers the consolidated entity of Petro Matad Limited and its controlled entities.

 

Petro Matad Limited, a company incorporated in the Isle of Man on 30 August 2007 has four wholly owned subsidiaries, including Capcorp Mongolia LLC and Petro Matad LLC (both incorporated in Mongolia), Central Asian Petroleum Corporation Limited ("Capcorp") and Petromatad Invest Limited (both incorporated in the Cayman Islands).  Its major shareholder is Petrovis Matad Inc.

2.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

The half-year financial report does not include all of the notes of the type normally included within the annual financial report and therefore cannot be expected to provide as full an understanding of the financial performance, financial position and financing and investing activities of the consolidated entity as the full financial report.

 

The half-year financial report should be read in conjunction with the annual Financial Report of Petro Matad Limited as at 31 December 2018. The half-year consolidated financial statements have been prepared using the same accounting policies as used in the annual financial statements for the year ended 31 December 2018.

 

It is also recommended that the half-year financial report is considered together with any public announcements made by Petro Matad Limited and its controlled entities during the half-year ended 30 June 2019.

 

 

The half-year consolidated financial report is a general purpose financial report, which has been prepared in accordance with the requirements of International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board ('IASB'). The half-year financial report has been prepared on a historical cost basis, except where stated.

 

The financial report is presented in US dollars and all values are rounded to the nearest thousand dollars ($'000).

 

For the purpose of preparing the half-year financial report, the half-year has been treated as a discrete reporting period.

 

 

The consolidated financial statements comprise the financial statements of the Group as at 31 December each year.

 

Subsidiaries are entities controlled by the Group.  Control exists when the Group has the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities.  In assessing control, potential voting rights that presently are exercisable or convertible are taken into account.  The financial statements of the subsidiaries are included in the consolidated financial statements from the date that control commences until the date that control ceases.

 

The financial statements of subsidiaries are prepared for the same reporting period as the parent company, using consistent accounting policies. Adjustments are made to bring into line any dissimilar accounting policies that may exist.

 

A change in the ownership interest of a subsidiary that does not result in a loss of control is accounted for as an equity transaction.

 

All intercompany balances and transactions, including unrealised profits arising from intra-group transactions, have been eliminated in full.  Unrealised losses are eliminated unless costs cannot be recovered.

 

3.   CONTRIBUTED EQUITY

 

 

                        CONSOLIDATED

 

 

 

30 Jun 2019

  31 Dec 2018

 

 

 

$'000

     $'000

Ordinary shares (i)

662,196,306 shares issued and fully paid

(31 Dec 2018: 662,196,306)

 

143,174

143,174

 

 

 

143,174

143,174

 

                 

 

(i) Ordinary shares

Full paid ordinary shares carry one vote per share and carry the right to dividends.

4.   RESERVES

 

A detailed breakdown of the reserves of the Group is as follows:

 

 

 

Merger reserve

Equity benefits reserve

Foreign currency translation

Total

Consolidated

$'000

$'000

$'000

$'000

 

 

 

 

 

As at 1 July 2018

831

3,268

(1,157)

2,942

Currency translation differences

-

-

(32)

(32)

Share based payments

-

(250)

-

(250)

As at 31 December 2018

831

3,018

(1,189)

2,660

 

 

 

 

 

Currency translation differences

-

-

(1)

(1)

Share based payments

-

(80)

-

(80)

As at 30 June 2019

831

2,938

(1,190)

2,579

 

5.   EARNINGS/(LOSS) PER SHARE

 

The following reflects the income and share data used in the total operations basic and diluted earnings/(loss) per share computations:

 

 

CONSOLIDATED

 

30 Jun

2019

30 Jun

2018

Basic earnings/(loss) per share

 

 

Total basic earnings/(loss) per share (US$ cents per share) (note a)

(0.67)

(1.38)

 

 

 

Diluted earnings/(loss) per share

 

 

Total diluted earnings/(loss) per share (US$ cents per share) (note b)

(0.67)

(1.38)

 

 

 

(a)  Basic earnings/(loss) per share

 

 

The profit/(loss) and weighted average number of ordinary shares used in the calculation of basic loss per share are as follows:

 

 

 

 

 

 

 

 

Net profit/(loss) attributable to ordinary shareholders (US$'000)

(4,406)

(6,654)

 

 

 

Weighted average number of ordinary shares for the purposes of basic earnings per share ('000)

662,196

482,124

 

 

 

(b)  Diluted earnings/(loss) per share

 

 

The profit/(loss) and weighted average number of ordinary shares used in the calculation of diluted earnings per share are as follows:

 

 

 

 

 

 

 

 

Net profit/(loss) attributable to ordinary shareholders (US$'000)

(4,406)

(6,654)

 

 

 

Weighted average number of ordinary shares for the purposes of basic earnings per share ('000)

662,246

482,124

 

Share Options and Conditional Share Awards could potentially dilute basic loss per share in the future, however they have been excluded from the calculation of diluted loss per share because they are anti-dilutive for both years presented.

 

6.   EVENTS AFTER THE REPORTING DATE

 

None

 

 


This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact [email protected] or visit www.rns.com.
 
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