Agriterra Ld Regulatory News (AGTA)

20 Dec 2006 07:01

White Nile Limited20 December 2006 White Nile Ltd / Ticker: WNL / Index: AIM / Sector: Oil & Gas 20th December 2006 White Nile Ltd ('White Nile' or 'the Company') Final Results White Nile Ltd, the AIM listed oil and gas exploration company, announces itsresults for the year ended 30 June 2006. Overview • Progress made on many fronts at flagship oil project, the 67,000 sq km Block Ba in Southern Sudan • Assembled an experienced team and network of international partners, and established local offices and representation • High resolution 2D seismic evaluation programme being undertaken to identify drill targets and oil potential of Block Ba • Over 550 km of high-density 2D seismic data interpreted from the prospective Muglad Basin in the western part of Block Ba • Several drill targets identified including one 50 sq km structure • Drilling programme targeted for the first quarter of 2007, minimum of two exploration wells in 2007 - drill rig identified • Contracted Environmentalistes Sans Frontieres to complete full Environmental and Social Impact Assessment on Block Ba • Extensive community infrastructure projects undertaken • Significant de-mining over a 500 sq km area around exploration base at Padak in Jonglei Province • Continued support from the Government of Southern Sudan who are equity stakeholders in White Nile • Improving political climate and recognition for the Government of Southern Sudan - US government lifting certain trade sanctions on Southern Sudan • Completed first half of the initial geophysical programme of magneto-telluric and gravity surveys in the Southern Rift Basins, Ethiopia • In December 2006 £12 million (gross of expenses) raised to fast track operations and move into the drill stage of development programme on Block Ba Chairman's Statement It gives me great pleasure to report on White Nile's progress towards fulfillingits objective of becoming a new independent oil producer focused in SouthernSudan and the immediate region. During the period under review we have madeprogress on many fronts having advanced our exploration programme on Block Ba inSouthern Sudan, strengthened local and governmental relationships, assembled anexperienced team and network of international partners, and established localoffices and representation. With these in place the Board believes that WhiteNile is well positioned to achieve its objectives and generate further value forits shareholders. Exploration Southern Sudan As shareholders will know, our flagship project is the 67,000 sq km Block Ba inSouthern Sudan, an area equivalent to approximately 28 UK North Sea blocks or 11UK North Sea quadrants. Our exploration programme is currently focusing on theextensions of the productive Muglad and Melut Basins and is being coordinatedfrom our exploration hub at Padak, in the western section of Block Ba north ofBor, as well as our administrative office in Juba. A high resolution 2D seismic evaluation programme is being undertaken, which isalready enabling us to identify drill targets and help us understand the trueextent of the oil potential of the area. Over 550 km of high-density 2D seismicdata has already been interpreted from the prospective Jonglei sub-basin of theMuglad Basin in the western part of Block Ba. Several prospects havesubsequently been identified in the 1,800 sq km project area. The seismic data has been processed and interpreted to provide a newunderstanding of the prospectivity of the Jonglei sub-basin of the Muglad Basin. A sedimentary section of up to 7 km in thickness and rift structures suitablefor forming hydrocarbon traps are clearly shown, which are analogous to theproducing South Sudanese Thar Jath, Mala, Heglig and Unity oilfields of theMuglad Basin to the northwest of Block Ba. In this way the geologicalconditions pertaining to the formation of oilfields in the Muglad Basin (Blocks1, 2, 4 and 5A) have been extrapolated into the Jonglei sub-basin in Block Ba.Blocks 1, 2 and 5A host the known Unity, Heglig and Thar Jath oilfields thathave estimated oil in place of circa 600 million, 550 million and 1 billionbarrels respectively. We have planned an ongoing exploration and development programme for Block Ba,which includes drilling a minimum of two exploration wells in 2007 during thedry season, with the first exploration well targeted for the first quarter of2007. We have already identified for use a Romanian F200 DH modular drill rig,which will target the identified structures on Block Ba, where we believe theproductive Muglad Basin extends into the concession area, including one largestructure of over 50 sq km. Further 2D seismic surveying will be undertaken and 3D seismic will beconsidered over any discoveries. White Nile will continue its high-density 2Dseismic programme in the Pibor Post Basin, part of the productive Melut Basin,which extends from Block Ba northwards and includes the Great Palogue discoveryand the Adar-Yale oilfield. These oilfields have estimated oil in place of circa2.9 billion barrels and circa 276 million barrels respectively. The explorationprogramme at Pibor remains on target to commence in early 2007. Ethiopia White Nile agreed a two year Joint Study Agreement in July 2005 with thePetroleum Operations Department of the Ministry of Mines of the FederalDemocratic Republic of Ethiopia, covering the area of southern Ethiopia known asthe 'Southern Rift Basins'. The approximate 70,000 sq km area is adjacent toPetronas' Gambela Block in the north and borders Southern Sudan and Kenya to thesouth. Exploration in the area is based on the geological concept that thepetroliferous Cretaceous and early Tertiary basins of Southern Sudan extendsouth-eastwards beneath the younger and less prospective East African rifts. TheCompany has completed the first half of its initial geophysical programme ofmagneto-telluric and gravity surveys in the Southern Rift Basins. Preliminaryinterpretation of data already gathered is now underway, which once completedshould enable us to understand the future prospectivity of the region. Political The Comprehensive Peace Agreement was signed between Northern and Southern Sudanin January 2005, which has lead to increased stability in the south of thecountry. The Government of Southern Sudan ('GOSS') is actively encouragingforeign investment with a broader aim to build its economic and physicalinfrastructure. This situation seems set to improve as the US differentiatesbetween Southern Sudan and the Northern Sudanese Government in Khartoum bystarting to allow economic activities between US companies and Southern Sudan bylifting certain trade sanctions. White Nile has always recognised the importance of developing contacts with bothlocal communities and the GOSS. This was highlighted by the originaltransaction which transferred a 50% equity stake in the Company to NilePetroleum Corporation ('NPC'), the national oil company of Southern Sudan, inreturn for a 60% interest in Block Ba. While the remaining 40% was retained byNPC, it was incumbent upon White Nile to raise the exploration and developmentfinance to ensure the advancement of Block Ba. The model was developed to enable the Southern Sudanese people to maximise thevalue of their oil assets as well as benefit directly from the generation offuture revenues. The corporate structure White Nile has employed providesfinancial and economic independence for the GOSS and reduces its reliance onmajor corporates. The South Sudanese people have the ability to control thedestiny of their oil assets to provide them with significant economicempowerment through an equity stake in White Nile. The Company has previously reported there is a rival claim on Block Ba from theFrench oil company, Total. White Nile's agreement is with the GOSS, which nowcontrols the territory where the concession is located, while Total allegedlyhad previously signed an agreement in regard to the Block with the SudaneseGovernment in Khartoum. The GOSS continues to reaffirm their absolute right to have issued concessionsin Southern Sudan, including Block Ba. We continue to have their support whichtranslates into our confidence in our position and, which we believe, isemphasised by our continued investment and development programme. However we dounderstand that the investment community is looking for complete clarity oftitle and we are actively petitioning our partners (specifically the GOSS) toobtain a solution to what we recognise as a political situation. Environmental The Board has contracted the service of a leading regional environmentalengineering firm Environmentalistes Sans Frontieres ('ESF') to conduct a fullEnvironmental and Social Impact Assessment of the Company's activities in BlockBa. Based in Kenya, ESF has extensive African project experience in oil and gas,mining and related sectors. With local knowledge, international reach andexperience in South Sudan, we feel that they are the right choice for thisimportant undertaking. The study will take four months to complete with theobjective being to ensure that the community needs and concerns will beaddressed and that White Nile conform to internationally accepted standards inprotecting the environment. Social White Nile is also actively assisting the local community and helping the arearegenerate as part of its commitment to social development. We have taken anactive role in training local people to help in the development of the projects,as the Board sees the training of key workers being imperative in thedevelopment of the country. Responding to the community's key needs, we haveemployed over 1,000 local Sudanese in the repair of over 20 km of man made dykebetween Jalle and Maar, as well as procuring food locally thus stimulating thelocal economy. Over $1.5 million has also been spent on de-mining key artery roads andvillages. So far, a 500 sq km area around Padak has been cleared, which has beenoverseen by de-mining experts, The Development Initiative ('TDI'). A number oflocals have also been recruited and trained in mine clearance to develop localcapacity in the region. We have also provided an emergency response team, whichis positioned to give assistance to communities in the area when required inmedical emergencies and when new ordinance is discovered. On a general level, we have provided fish nets, maize grinding machines, sewingmachines, generators, brick making machines and logistical support to the GOSSofficials in the immediate area, as identified by the community and governmentofficials. Together with TDI, we have supplied sports equipment and coordinatedthe formation of local teams to foster and develop team and community spirit. A meeting was recently convened in Bor to debate and finalise a cohesivecommunity development strategy in the Jonglei state, building upon the knowledgeof the local community, the administrative structures of the GOSS and the sectorspecific strengths of the relevant NGOs. Organised by the United NationsDevelopment Programme, this was jointly chaired by representatives of the GOSSand White Nile, and attended by Government officials in Jonglei state and therespective community leaders from the Payams as well as representatives of NGOsand companies working in the area. Our commitment is to Southern Sudan and we feel we have a responsibility to helpin its reconstruction and achieve its latent potential. Fundraising To continue with our exploration and development of Block Ba we recently raised£12 million (before expenses) through the issue of 12,000,000 new ordinaryshares at £1.00 per share. The funds raised will enable us to fast trackoperations and move into the drill stage of our development programme, scheduledfor the dry season in 2007. Results White Nile remains focussed on the development of its oil concessions inSouthern Sudan. The Company is still in the exploration stage and therefore isnot producing revenue. In line with expectations, the Company is reporting apre-tax loss of £1,417,577 (2005: £394,039) Conclusion The past year has seen many positive developments for White Nile. With itscommitted management team and strong local support, I am confident that oursuccess will continue and that our future growth and stability is secure. Bycontinuing to build relationships with industry specialists and localgovernments, we aim to strengthen further our portfolio of projects to become aleading independent oil producer in East Africa. Early results from Block Baare very exciting and with further development I believe that we cansignificantly de-risk the project and therefore increase shareholder value. Ourbeliefs are further enhanced by the changing attitude of the US Government tothe GOSS and the lifting of sanctions allowing US companies to carry out tradingin Southern Sudan. We are also party to the growing belief that the Southern Sudanese must havecontrol over their own resources and therefore the actions they have previouslytaken will be recognised by the entire country and Government of National Unity.There is a growing feeling that a resolution will be reached, which we firmlybelieve will be in our favour. Block Ba has huge potential and we intend todevelop it in tandem with our equity partners, the GOSS. Finally, I would like to take this opportunity of thanking all our employees,partners and supporters in Southern Sudan for their hard work and I look forwardto a continued strong relationship with them going forward. Phil Edmonds Chairman PROFIT AND LOSS ACCOUNT for the year ended 30 June 2006 Notes Year Period ended ended 30 June 30 June 2006 2005 £ £TURNOVER - - AIM admission costs - (215,186)Operating expenses (1,852,380) (322,025) OPERATING LOSS (1,852,380) (537,211) Interest receivable 439,372 143,172Interest payable (4,569) - LOSS ON ORDINARY ACTIVITIES BEFORE TAXATION (1,417,577) (394,039) Taxation - - LOSS ON ORDINARY ACTIVITIES AFTER TAXATION (1,417,577) (394,039) LOSS PER ORDINARY SHARE Basic and diluted 3 (0.447p) (0.273p) The operating loss for the period arises from the Company's continuingoperations. No separate statement of Total Recognised Gains and Losses has been presented asall such gains and losses have been dealt with in the profit and loss account. BALANCE SHEET 30 June 2006 Notes 2006 2005 £ £FIXED ASSETSIntangible assets 16,855,039 10,029,688Tangible assets 227,907 42,182 17,082,946 10,071,870 CURRENT ASSETSDebtors 340,137 -Cash at bank and in hand 6,049,114 14,790,959 6,389,251 14,790,959 CREDITORS: Amounts falling due within one year (974,728) (857,933) NET CURRENT ASSETS 5,414,523 13,933,026 NET ASSETS 22,497,469 24,004,896 CAPITAL AND RESERVESCalled up share capital 317,000 310,000Share premium account 23,992,085 17,088,935Shares to be issued - 7,000,000Profit and loss account (deficit) (1,811,616) (394,039) SHAREHOLDERS' FUNDS 4 22,497,469 24,004,896 CASH FLOW STATEMENT for the year ended 30 June 2006 Notes Year Period ended ended 30 June 30 June 2006 2005 £ £ Cash (outflow)/inflow from operating activities 5a (2,052,571) 326,748 Returns on investments and servicing of finance 5b 434,803 143,172 Capital expenditure and financial investment 5b (7,034,227) (1,012,896) CASH OUTFLOW BEFORE USE OF LIQUID RESOURCES AND FINANCING (8,651,995) (542,976) Management of liquid resources 5b 10,525,153 (14,525,153) Financing 5b (89,850) 15,333,935 INCREASE IN CASH IN THE PERIOD 1,783,308 265,806 RECONCILIATION OF NET CASH FLOW TO MOVEMENT IN NET FUNDS Year Period ended ended 30 June 30 June 2006 2005 £ £Increase in cash in the period 1,783,308 265,806 Cash (inflow)/outflow from (decrease)/increase in liquid (10,525,153) 14,525,153resources MOVEMENT IN NET FUNDS 5c (8,741,845) 14,790,959 Net funds at beginning of period 14,790,959 - NET FUNDS AT END OF PERIOD 6,049,114 14,790,959 NOTES for the period ended 30 June 2006 1 FINANCIAL INFORMATION The financial information for the period ended 30 June 2005 has been extractedfrom the Company's audited accounts. The Financial Information does notconstitute the Company's statutory financial statements. The figures for theperiod ended 30 June 2006 have been extracted from the annual accounts on whichthe auditors have not yet signed their audit report. 2 BASIS OF PREPARATION The financial statements have been prepared under the historical cost conventionand in accordance with applicable United Kingdom accounting standards. 3 LOSS PER ORDINARY SHARE The calculation of basic and diluted loss per ordinary share is based on thefollowing losses and number of shares. Year Period ended ended 30 June 30 June 2006 2005 £ £ Loss for the financial period 1,417,577 394,039 2006 2005 No. of No. of shares shares Weighted average number of shares 316,942,466 144,342,105 Due to the loss incurred in the period, there is no dilutive effect from theissue of share options. 4 RECONCILIATION OF MOVEMENT IN SHAREHOLDERS' FUNDS 2006 2005 £ £ Loss for the financial period (1,417,577) (394,039) Issue of shares during the period - 18,130,000 Issue costs (89,850) (731,065) Shares to be issued - 7,000,000 Net (reduction in)/addition to shareholders' funds (1,507,427) 24,004,896 Opening shareholders' funds 24,004,896 - Closing shareholders' funds 22,497,469 24,004,896 5 CASH FLOWS 2006 2005 £ £a Reconciliation of operating loss to net cash (outflow)/inflow from operating activities Operating loss (1,852,380) (537,211) Depreciation 23,151 6,026 Increase in debtors (340,137) - Increase in creditors 116,795 857,933 Net cash (outflow)/inflow from operating activities (2,052,571) 326,748 b Analysis of cash flows for headings netted in the cash flow 2006 2005 £ £ Returns on investments and servicing of finance Interest received 439,372 143,172 Interest paid (4,569) - Net cash inflow from returns on investments and servicing of finance 434,803 143,172 Capital expenditure and financial investment Purchase of intangible fixed assets (6,825,351) (964,688) Purchase of tangible fixed assets (208,876) (48,208) Net cash outflow from capital expenditure and financial (7,034,227) (1,012,896) investment Management of liquid resources Decrease/(increase) in cash deposited on short term deposit 10,525,153 (14,525,153) Net cash inflow/(outflow) from management of liquid resources 10,525,153 (14,525,153) Financing Proceeds from issue of share capital - 9,065,000 Share issue costs (89,850) (731,065) Proceeds from shares to be issued - 7,000,000 Net cash (outflow)/inflow from financing (89,850) 15,333,935 At 1 July Cash- At 30 Junec Analysis of net funds 2005 flow 2006 £ £ £ Cash at bank and in hand 265,806 1,783,308 2,049,114 Cash on deposit 14,525,153 (10,525,153) 4,000,000 14,790,959 (8,741,845) 6,049,114 6 POST BALANCE SHEET EVENTS On 4 December 2006 the company placed 12,000,000 ordinary share of 0.1p each at£1 raising gross cash proceeds of £12,000,000. These funds will be used to fundthe drilling and development of the company's Block Ba oil concession area inSouthern Sudan. Copies of the Report and Accounts for the period ended 30 June 2006 are beingsent to shareholders. Further copies will be available from the CompanySecretary's office, which is Salans, Millennium Bridge House, 2 Lambeth Hill,London, EC4V 4AJ. * * E N D S * * For further information please contact: Phil Edmonds White Nile Ltd Tel: 0845 108 6060Jonathan Wright Seymour Pierce Ltd Tel: 0207 107 8000Hugo de Salis St Brides Media & Finance Ltd Tel: 020 7242 4477 This information is provided by RNS The company news service from the London Stock Exchange