BPC.L Regulatory News (BPC)

RNS Number : 5544T

Bahamas Petroleum Company PLC

30 September 2010

 

30 September 2010

 

Bahamas Petroleum Company plc

("BPC" or the "Company")

 

Interim Results for the period ended 30 June 2010

 

BPC, the AIM quoted oil and gas exploration company with licences in The Commonwealth of The Bahamas, is pleased to announce its interim results for the six months ended 30 June 2010. 

 

Highlights:

 

·; a period of significant progress for the business;

 

·; successfully shot the first seismic in the area since 1987, producing some encouraging results for the Company that indicate large structures containing hydrocarbon indicators;

 

·; further additional 2D and 3D seismic programs to be carried out by Q1 2011;

 

·; completed re-domicile of the Company to the Isle of Man;

 

·; change of the Company's name to Bahamas Petroleum Company plc, to properly reflect the Company's focus; and

 

·; active collaboration with the Government of The Bahamas following the Macondo well situation, to ensure there are appropriate regulations, environmental protection and safety procedures in place prior to commencing any drilling programmes.

 

Alan Burns, Chairman and CEO of BPC, commented:

 

"The first half of 2010 was an active period for the Company, as we continue to make advances in our portfolio and seek to identify targets which could be potentially ready for drilling by 2011.

 

"We have simplified the business structure, re-domiciled the Company to the Isle of Man and changed its name to Bahamas Petroleum Company. It is the focus of the board of directors of the Company (the "Board") and myself to deliver increased value to all of the Company's shareholders, as we progress the exploration of our acreage towards possible drilling."

 

- Ends -

 

Enquiries:

 

Bahamas Petroleum Company plc Alan Burns, Chairman and CEO Dr Paul Crevello, Chief Operating Officer	Tel: +44 (0) 1624 641199 Tel: +1 720 771 7583
Strand Hanson Limited Rory Murphy / Liam Buswell	Tel: +44 (0) 20 7409 3494
Novus Capital Markets Ltd Charles Goodfellow / Paul Dudley	Tel: +44 (0) 20 7107 1872
FirstEnergy Capital LLP Hugh Sanderson / Derek Smith	Tel: +44 (0) 20 7448 0200
Financial Dynamics Billy Clegg / Ed Westropp	Tel: +44 (0) 20 7831 3113

 

Chairman's Statement

 

 

Dear Shareholder,

 

There has been some excellent progress made on our Bahamas project in the last few months.

 

From the corporate perspective, and with shareholder approval, we have begun the rationalisation of the Company and its subsidiaries' (the "Group") previously complicated asset ownership structure, through the recently completed re-domicile of the Company to the Isle of Man by way of a scheme of arrangement and the ongoing process of eliminating unnecessary companies within the Group. We have also changed our name to Bahamas Petroleum Company, to properly reflect the Company's focus.

 

In the field, we have shot the first seismic in the area since 1987. This has produced some encouraging results indicating large structures containing hydrocarbon indicators, which will lead us into additional 2D and 3D seismic programs in the next few months. This will allow us to mature a prospect for drilling next year, subject to Bahamian Government approval, which would be much earlier than previously anticipated. The water depths of 400 to 500 metres are modest by industry standards, with suitable rigs being widely available for deployment.

 

Given the problems with the Macondo well blowout in the Gulf of Mexico, we are working with the Government of The Bahamas to ensure there are appropriate regulations, environmental protection and safety procedures in place prior to commencing any drilling programmes. It is nonetheless worth highlighting that our geological formations are quite different to that of the Macondo prospect, being more stable and with the shallower water depths, allowing the application of more commonplace drilling techniques and equipment. Unlike the Macondo well, we are not at the frontier of drilling technology and are therefore not faced with the risks associated with such advanced techniques and equipment. In addition, it is worth noting that rig owners are increasing the routine maintenance and servicing of their equipment and revising their safety procedures in the light of the loss of eleven lives and the cost and damage suffered in the wake of the accident.

 

The environmental damage suffered in the Gulf of Mexico was nowhere near as severe as many originally feared and I am pleased to say that the Company was able to assist the Bahamas Government by performing a baseline environmental study of the coastline to determine if oil from the BP spill would hit Bahamian shores, which it has not. We did, however, find tar balls and evidence of oil washed ashore in the southern Bahamas, that were not from the spill in the Gulf Of Mexico and most probably originated from natural oil seeps in our region, which is positive news in terms of our exploration focus.

Our licence applications with Statoil were gazetted this summer and we understand these to be progressing in the normal fashion. We are currently working with The Bahamian Government to ensure that the Group's exploration activities follow best practice regarding both safety and preservation of the environment.

 

The next few months will be an active time for all of us at the Bahamas Petroleum Company and we look forward to keeping you informed of all developments through our website and future announcements.

 

Finally, I would like to emphasize our commitment to the generation of shareholder value. It is the focus of the Board and myself to deliver increased value to all of the Company's shareholders as we progress the exploration of our acreage towards possible drilling in 2011.

 

 

 Alan Burns

 Chairman and CEO

Consolidated statement of comprehensive income

 

		Six months ended 30 June 2010 (Unaudited)		Six months ended 30 June 2009 (Unaudited)		Year ended 31 December 2009 (Audited)
		$		$		$
Employee benefits expense		(696,793)		(351,957)		(924,056)
Depreciation and amortisation expense		(18,705)		(39,213)		(92,056)
Loss on disposal of fixed assets		-		(13,147)		(13,147)
Other expenses		(1,301,145)		(145,053)		(1,400,188)
Operating loss		(2,016,643)		(549,370)		(2,429,447)
Finance income		-		4,251		4,026
Loss before income tax		(2,016,643)		(545,119)		(2,425,421)
Income tax credit		61,787		-		-
Loss for the year		(1,954,856)		(545,119)		(2,425,421)

 

Other comprehensive income

Currency translation differences		106,615		(125,370)		(231,913)
Total comprehensive income for the period		(1,848,241)		(670,489)		(2,657,334)

 

 

 

Basic and diluted loss per share (cents per share)

(0.22)

(0.08)

(0.31)

 Consolidated statement of changes in equity for the six months ended 30 June 2010 (unaudited) 

 

 

	Share capital	Share premium reserve	Merger reserve	Reverse acquisition reserve	Share based payment reserve	Other reserves	Retained earnings	Total equity
	$	$	$	$	$	$	$	$
At 1 January 2010 - as previously reported	28,764	73,634,186	-	(53,846,526)	347,361	(106,615)	(14,319,340)	5,737,830
Reorganisation - Scheme of arrangement	(5,522)	(73,634,186)	73,639,708	-	-	-	-	-
At 1 January 2010 - after reorganisation	23,242	-	73,639,708	(53,846,526)	347,361	(106,615)	(14,319,340)	5,737,830
Changes in equity 1 Jan 2010 to 30 June 2010
Total comprehensive income for the year	-	-	-	-	-	106,615	(1,954,856)	(1,848,241)
Share options - value of services	-	-	-	-	22,683	-	-	22,683
Issue of ordinary shares	2,056	-	3,490,976	-	-	-	-	3,493,032
Balance at 30 June 2010	25,298	-	77,130,684	(53,846,526)	370,044	-	(16,274,196)	7,405,304

  Consolidated statement of changes in equity for the six months ended 30 June 2009 (unaudited)

	Share capital	Share premium reserve	Merger reserve	Reverse acquisition reserve	Share based payment reserve	Other reserves	Retained earnings	Total equity
	$	$	$	$	$	$	$	$
At 1 January 2009 - as previously reported	28,764	73,634,186	-	(53,846,526)	300,139	125,298	(11,893,919)	8,347,942
Reorganisation - Scheme of arrangement	(5,522)	(73,634,186)	73,639,708	-	-	-	-	-
At 1 January 2009 - after reorganisation	23,242	-	73,639,708	(53,846,526)	300,139	125,298	(11,893,919)	8,347,942
Changes in equity 1 Jan 2009 to 30 June 2009
Total comprehensive income for the year	-	-	-	-	-	(125,373)	(545,119)	(670,492)
Balance at 30 June 2009	23,242	-	73,639,708	(53,846,526)	300,139	(75)	(12,439,038)	7,677,450

 

Consolidated statement of changes in equity for the year ended 31 December 2009 (Audited)

 

	Share capital	Share premium reserve		Merger reserve	Reverse acquisition reserve	Share based payment reserve	Other reserves	Retained earnings	Total equity
	$	$		$	$	$	$	$	$
At 1 January 2009 - as previously reported	28,764	73,634,186		-	(53,846,526)	300,139	125,298	(11,893,919)	8,347,942
Reorganisation - Scheme of arrangement	(5,522)	(73,634,186)		73,639,708	-	-	-	-	-
At 1 January 2009 - after reorganisation	23,242	-		73,639,708	(53,846,526)	300,139	125,298	(11,893,919)	8,347,942
Total comprehensive income for the year	-	-		-	-	-	(231,913)	(2,425,421)	(2,657,334)
Share options - value of services	-	-		-	-	47,222	-	-	47,222
Balance at 31 December 2009	23,242	-		73,639,708	(53,846,526)	347,361	(106,615)	(14,319,340)	5,737,830

 

Consolidatedbalance sheet at 30 June 2010

 

				30 June 2010 (Unaudited)			30 June 2009 (Unaudited)					31 December 2009 (Audited)
				$			$					$
Non-current assets
Cash not available for use				113,039			165,111					119,555
Property, plant and equipment				128,295			70,200					18,706
Exploration and evaluation assets				4,838,792			4,170,426					4,063,824
				5,080,126			4,405,737					4,202,085
Current assets
Cash and cash equivalents				2,126,571			2,883,656					1,337,885
Trade and other receivables				556,223			553,554					469,677
				2,682,794			3,437,210					1,807,562
Total assets				7,762,920			7,842,947					6,009,647
Current liabilities
Trade and other payables				357,616			165,497					271,817
Total liabilities				357,616			165,497					271,817
Equity
Ordinary shares			25,298					23,242			23,242
Merger Reserve			77,130,684					73,639,708			73,639,708
Reverse acquisition reserve			(53,846,526)					(53,846,526)			(53,846,526)
Share based payments reserve			370,044					300,139			347,361
Other reserves			-					(75)			(106,615)
Retained earnings			(16,274,196)					(12,439,038)			(14,319,340)
Total equity			7,405,304					7,677,450			5,737,830
Total equity and liabilities			7,762,920					7,842,947			6,009,647

 

These financial statements were approved by the Directors and authorised for issue on 24 September 2010

 

 

 

 

 

Alan Burns, Chairman

Michael Proffitt, Director

 

 

Consolidated cash flow statement

 

	30 June 2010 (Unaudited)		30 June 2009 (Unaudited)		31 December 2009 (Audited)
	$		$		$
Cash flows from operating activities
Payments to suppliers and employees	(1,807,597)		(944,515)		(2,823,096)
Net cash used in operating activities	(1,807,597)		(944,515)		(2,823,096)
Cash flows from investing activities
Payments for property, plant and equipment	(128,295)		-		-
Proceeds from sale of property, plant and equipment	-		20,209		4,619
Payments for exploration and evaluation assets	(774,968)		(114,839)		(8,237)
Deposits for bank guarantees	-		1,052,328		1,085,061
Interest received	-		4,251		4,026
Net cash (used in)/generated from investing activities	(903,263)		961,949		1,085,469
Cash flows from financing activities
Proceeds from issuance of ordinary shares	3,493,032		-		-
Net cash generated from financing activities	3,493,032		-		-
Net increase/(decrease) in cash and cash equivalents	782,172		17,434		(1,737,627)
Cash and cash equivalents at the beginning of the period	1,337,855		3,004,451		3,004,451
Effects of exchange rate changes on cash and cash equivalents	6,544		(138,229)		71,031
Cash and cash equivalents at the end of the period	2,126,571		2,883,656		1,337,855

 

 

1. Basis of preparation

 

This unaudited consolidated interim financial information has been prepared using the recognition and measurement principles of International Accounting Standards, International Financial Reporting Standards and Interpretations adopted for use in the European Union (collectively "EU IFRSs"). The principal accounting policies used in preparing the interim results are unchanged from those disclosed in the Group's financial statements for the year ended 31 December 2009. It is not expected that there will be any changes or additions to these in the annual financial statements for the year ended 31 December 2010.

 

While the financial information included in this interim consolidated financial information has been prepared in accordance with the recognition and measurement criteria of International Financial Reporting Standards as adopted by the EU ("IFRSs"), this interim consolidated financial information does not itself contain sufficient information to comply fully with IFRSs.

 

The financial information for the six months ended 30 June 2010 and 30 June 2009 is unaudited and does not constitute the Group's statutory financial statements for those periods. The comparative financial information for the full year ended 31 December 2009 has, however, been derived from the statutory financial statements for that period. The auditors' report on those accounts was unqualified and did not include references to any matters to which the auditors drew attention by way of emphasis without qualifying their report.

 

 

2. Scheme of Arrangement

 

On 15 June 2010, Bahamas Petroleum Company plc (formerly BPC plc) ("BPC plc"), a company incorporated in the Isle of Man, became the ultimate holding company of BPC Limited pursuant to a scheme of arrangement approved by the Chief Justice of the Falkland Islands and the shareholders of BPC Limited, the then AIM listed holding company of the Group (the "Scheme of Arrangement"). Pursuant to the Scheme of Arrangement, ordinary shares, each having a nominal value of £0.00002, of BPC Limited ("BPC Limited Ordinary Shares") were exchanged, on a one-for-one basis, for ordinary shares, each having a nominal value of £0.00002, of BPC plc ("BPC plc Ordinary Shares").

 

As a result of the Scheme of Arrangement, BPC Limited is now a wholly owned subsidiary of BPC plc. The BPC plc Ordinary Shares carry substantially the same rights as did the BPC Limited Ordinary Shares. The Scheme of Arrangement did not involve any cash payment for the BPC plc Ordinary Shares. Immediately after the Scheme of Arrangement became effective, BPC plc had the same Board, management and corporate governance arrangements as BPC Limited had immediately prior thereto. The consolidated assets and liabilities of BPC plc immediately after the effective time of the Scheme of Arrangement are the same as the consolidated assets and liabilities of BPC Limited immediately prior thereto.

 

BPC plc was incorporated on 25 August 2009. Prior to 15 June 2010, BPC plc was held in trust for the Group. The Group at the time maintained full control over the economic decisions of the company.

 

All BPC Limited share options that were in existence immediately prior to the Scheme of Arrangement were exchanged on a one-for-one basis for share options in BPC plc, with no change in terms or conditions.

 

The Scheme of Arrangement falls outside the scope of IFRS 3 "Business Combinations". Accordingly, following the guidance regarding the selection of appropriate accounting policy provided by IAS 8 "Accounting policies, changes in accounting estimates and errors", the Scheme of Arrangement has been accounted for in these interim financial statements using the principles of merger accounting. This policy reflects the economic substance of the Scheme of Arrangement. Although the Scheme of Arrangement did not become effective until 15 June 2010, the consolidated interim financial statements of BPC plc for the six months ended 30 June 2010 are presented as if the Scheme of Arrangement had been effective on 1 January 2009. In accordance with the requirements of merger accounting, the comparative information in these consolidated interim financial statements has been extracted from the BPC Limited consolidated financial statements for the year ended 31 December 2009 and period ended 30 June 2009. Those financial statements incorporated the results of BPC Limited and its subsidiary undertakings for the financial year and interim period then ended. Earnings per share are unaffected by the Scheme of Arrangement.

 

 

 

3. Events after the balance sheet date

 

 

On 2 September 2010, a special resolution was passed at an extraordinary meeting of the members of the Company to change the name of the Company to Bahamas Petroleum Company plc.

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