Last checked at 30 Apr 2018 18:16
30 April 2018
Curzon Energy Plc
("Curzon Energy" or the "Company")
Results for the Year Ended 31 December 2017
Curzon Energy, the 100% owner of the 45,000 acre Coos Bay Coalbed Methane (CBM) Project, announces its full year audited results for the year ended 31 December 2017. These results relate in part to the period prior to the Company's acquisition of Coos Bay Energy LLC which was concluded in October 2017.
Financial and Operational Highlights
· Successful IPO of Curzon Energy in October 2017 and admission to the Official List and to trading on the Main Market of the London Stock Exchange raising gross proceeds of £2.3m
· Completed first acquisition of 100% of Coos Bay Energy LLC, c. 45,370 acres of coalbed methane leases, ("Coos Bay CBM project") with 2C contingent gas resources of 273.5 BCF.
· Pre-tax loss of $1.83m, (2016: $3.54m) in line with expectations and including acquisition and transaction costs
· Net cash of $1.6m at 30 December 2017
Post Period Highlights
· Workover and clean-out operations completed on five wells (9-21, 1-21, 15-21,16-16 and 13-15) at Coos Bay CBM project
· Well testing commenced on all five wells on 29 January, recording gas volumes in line with expectations
· Gas volumes produced sufficient to power wellhead pumping equipment with excess gas being flared
· Individual wells are now exceeding gas production of 10 Mscf/day and are on increasing trend as expected
· Operations have commenced to remove bridge plugs and to significantly extend the perforation intervals in both gas bearing coal seam zones and conventional sandstone reservoirs
· The Company continues to advance the implementation of the permitted water disposal system, together with gas sales contract negotiations and a pipeline interconnection agreement for future gas sales
Stephen Schoepfer, Chief Executive Officer comments:
"Following our successful IPO on the Main Market and fundraise in October 2017, we have commenced operations at pace, deploying the money raised to bring our highly attractive CBM project to first gas and demonstrating "proof of concept". The Company has achieved significant progress in a short time and we are pleased to see Coos Bay delivering increasing gas rates and pressures in line with our expectations.
"With the proposed extended perforation intervals, in both gas bearing coal seam zones and conventional sandstone reservoirs, we expect to see gas production and pressure increases which will aid our understanding of the project and enable us to make a decision on a phase two commercial development programme."
A copy of Curzon Energy's 2017 Annual Report can be found on the Company Website:
http://www.curzonenergy.com/investor-relations/reports-and-presentation/2018
Enquiries:
For further information please contact:
Curzon Energy PLC | c/o Camarco |
Stephen Schoepfer / Thomas Wagenhofer | +44 20 3757 4980 |
www.curzonenergy.com |
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SP Angel Corporate Finance LLP | +44 20 3470 0470 |
Richard Hail / Richard Redmayne |
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Camarco (Financial PR) | +44 20 3757 4980 |
Georgia Edmonds / Owen Roberts / Monique Perks |
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Notes to Editors:
Curzon Energy Plc, is the 100% owner of the 45,000 acre Coos Bay Coalbed Methane (CBM) Project, located in Oregon USA. Coos Bay has 2C contingent gas resources of 273.5 BCF.
The Company is implementing a cost effective staged development plan, targeting first gas and cash generation from Phase I in Q2 2018. The Phase I work programme consists of the low-cost workover of five existing, and drilling of two new wells.
The Company is led by an experienced Board and senior management team who have extensive industry and financial experience. Curzon Energy is listed on the LSE Main Market under the ticker CZN.
About Coalbed Methane (CBM):
Coalbed methane gas (CBM) (or coal seam gas (CSG) or coal-mine methane (CMM)), is a form of natural gas extracted from coal seams or coal deposits. CBM is generated during the process of coalification which is the transformation of plant material into coal and is contained in the coal microstructure. Typical CBM recovery entails initially pumping water out of the coal to allow the natural gas to escape. Methane is the principal component of the natural gas from CBM production, which is typically made up of ~95 per cent methane and normally does not contain hydrogen sulphide or other sulphur compounds. Natural gas produced from CBM can normally be added to natural gas pipelines without any special treatment.
The United States has the longest history and greatest volumes of CBM production, however, other countries such as Canada, China and Australia have increased production over recent decades.
Competent Person's Statement
The information contained in this announcement has been reviewed and approved by Thomas Wagenhofer, Technical Director of Curzon, who is a petroleum engineer and oil and gas executive with over 20 years' international industry experience. Mr. Wagenhofer holds a MS degree in Petroleum Engineering from the University of Texas at Austin (1995) and a BS degree in Petroleum Engineering from the University of Alaska Fairbanks (1994). He is a registered Professional Engineer with the Texas Board of Professional Engineers (current status inactive) in the State of Texas, USA.
Market Abuse Regulation (MAR) Disclosure
Certain information contained in this announcement would have been deemed inside information for the purposes of Article 7 of Regulation (EU) No 596/2014 until the release of this announcement.
Chairman's Statement
I am pleased to present the annual report for the Company covering its results for the period from 01 January 2017 to 31 December 2017.
The Company was incorporated for the purpose of pursuing a targeted acquisition strategy of oil and gas assets. The Company's first acquisition occurred on 03 October 2017 when the Company acquired 100% of the membership interests of Coos Bay Energy LLC ("Coos Bay"), which is the owner and operator of approximately 45,370 acres of coalbed methane leases in Coos Bay, Oregon, USA, pursuant to a membership interest purchase agreement dated 20 May 2017 (the "Acquisition"). The consideration for the Acquisition involved the issuance by the Company of an aggregate of 40 million Ordinary Shares to the members of Coos Bay.
On 4 October, the Company admitted its shares to the Standard Listing segment of the Official List, to trade on the London Stock Exchange's main market for listed securities, raising gross proceeds of £2.3 million (approximately £1.6 million net of expenses), which are being used to fund the Company's operations and, in particular, its activities in connection with the Coos Bay project.
Following the Acquisition, the Group's main focus has been on developing the business of Coos Bay. The main objectives for the Coos Bay project are to complete Phase I (proof of concept) which involves re-entering the five existing wells and bringing them to production, followed by the drilling and completion of up to two additional wells, and then connecting the wells to the nearby pipeline. First gas from the wells is expected in Q2 of 2018. Should Phase I be successful, the Company intends to seek further capital to progress to Phase II (initial development), which would involve the development of approximately 58 additional wells. Should Phase II prove successful, a further funding round will be required to commence and complete Phase III (large scale development), which would bring the total wells for the project to 400+.
The Board has been significantly strengthened during the 2017 fiscal year in order to pursue this strategy. Corporate governance will remain a topic close to the top of the Board's agenda going forward.
The Group incurred a loss of US$1,833,381 in the period ended 31 December 2017. A majority of this loss comprised expenditures in relation to the acquisition of Coos Bay, the Group's admission to the London Stock Exchange and commencement of activities for Phase I of the Coos Bay project.
On behalf of the Board, I would like to take this opportunity to thank our staff and advisers for their hard work as well as the shareholders for their support given to the Company. With the Coos Bay acquisition now complete, the Board believes this will provide the potential to deliver significant value to shareholders.
We look forward to updating shareholders on our further progress in due course.
John McGoldrick
Non-Executive Chairman
30 April 2018
Strategic Report
Financial Results
The Company was formed in January 2016 to undertake acquisitions in the oil and gas sector. As noted in the Chairman's Statement, during the period ended 31 December 2017, the Company commenced trading and acquired Coos Bay.
The acquisition of Coos Bay was successfully concluded in October 2017 for an agreed consideration of £3.2 million, payable by way of the issue of shares to the former owners of Coos Bay. We also completed a placing of shares for a cash consideration of £2.3 million, pursuant to the Company's admission to the Official List. The costs of admission (including fees and commissions) were £0.7 million. The net proceeds, after deducting fees and expenses in connection with admission were approximately £1.6 million.
The Group loss for the period to 31 December 2017 was US$1,833,381. There were no revenues and the majority of the loss related to preliminary expenditures in connection with the Company's acquisition of Coos Bay, admission to the Official List and commencement of Phase I of the Coos Bay project.
As a result of these initial losses, there is no tax charge for the period.
The loss per share was US$0.03 (2016: loss US$0.08).
The Group's cash balances at the end of 2017 totalled US$1,595,035. With the net proceeds from the Company's placing of shares in September 2017, as well as amounts available pursuant to the terms of a loan facility provided by YA Global Investments, L.P., the Company's cash resources are considered sufficient to meet its obligations.
The Directors are now looking to implement the development of the Coos Bay business whilst keeping day-to-day overhead costs under control. The acquisition of Coos Bay is the first step in the Company's acquisition strategy.
The Board believes that the Company will be able to raise, as required, sufficient cash or reduce its commitments to enable it to continue these objectives, and to continue to meet, as and when they fall due, its liabilities for at least the next twelve months from the date of approval of these financial statements. The financial statements have, therefore, been prepared on the going concern basis.
Following the acquisition of Coos Bay, the Group has 7 staff (including Directors).
Principal activities
The Company was incorporated on 29 January 2016 in England and Wales as an investment company to acquire oil and gas assets. Its first acquisition was of Coos Bay. The Directors expect to identify and assess other oil and gas opportunities in the future and expect to return to the market if they wish to acquire and/or raise funds for other projects.
Following the acquisition of Coos Bay by the Company, the Group's main focus will be to develop the business of Coos Bay and to focus on the Coal Bed Methane ("CBM'') gas sector in Oregon. The Company raised £650,362 in a private funding round principally from UK, US and European investors prior to admission. These funds were primarily used to meet start-up costs and costs associated with acquiring Coos Bay. The consideration for the acquisition was by the issue of 40 million Ordinary Shares to the members in Coos Bay and assumption by the Company of certain loan notes as described in note 15 to the financial statements.
Coos Bay owns certain CBM and related assets, which it acquired on 4 November 2016 by acquiring Westport Energy Acquisition, Inc. and its wholly owned subsidiary Westport Energy LLC (the 'US Group '') from Westport Energy Holdings Inc., a publicly held company trading on the OTC Pink Market. The US Group had been operating a CBM business in Coos Bay, Oregon for 6 years. At the time of the Acquisition, the US Group's CBM business consisted of leases to approximately 45,370 acres in Coos Bay, Oregon.
The management team of the US Group, has continued in their management roles allowing the Group to maintain management continuity and continuity in-field operations.
The Group's business will be operated through the US Group, with a focus on oil and gas exploration, appraisal and development, with the goal of commencing production from certain assets in the near term. Its first project is to appraise, develop and produce CBM gas from prospective and contingent resources in the Coos Bay Basin, primarily targeting natural gas from coal seams of the Coaledo Formation in the Coos Bay Basin. Secondary objectives of the Group may include the exploration, production and acquisition of natural gas, and possibly oil, trapped in conventional reservoirs
Following the acquisition of Coos Bay, the Company is a holding company with the following subsidiaries:
Name | Country of Incorporation | Proportion of equity ownership | Principal activity |
Coos Bay Energy LLC | Nevada, USA | 100% | Gas Exploration & Development |
Westport Energy Acquisition, Inc. | Delaware, USA | 100% | Holding Company |
Westport Energy, LLC | Delaware, USA | 100% | Gas Exploration & Development |
Coos Bay, which employs the Group's employees and conducts operations in the Coos Bay Basin Area, is held directly by the Company. Its two indirectly owned subsidiaries are Westport Energy Acquisition Inc. and its wholly-owned subsidiary, Westport Energy LLC.
Review of the business
2017 saw the Company's formation and development of management's long-term plans for an acquisition strategy in the oil and gas sector. These have been progressed further during 2017 culminating with the acquisition of Coos Bay and the Company's listing on the London Stock Exchange and the commencement of Phase I of the Coos Bay project.
Key performance indicators (KPIs)
The Directors have identified the following key performance indicators ('KPIs') that the Company will track over 2017 and into future years. These will be refined and augmented as the Group's business matures: The Directors consider that the KPIs are:
i) A well-funded business in terms of cash resources; and
ii) Appraisal and drilling results of its CBM assets.
Principal Risks and Risk Management
Exploration is an inherently risky business:
· Even the most promising prospects can have failures for many reasons, such as:
o The coal bed methane assets may not be found in commercial quantities if there are errors in the underlying geological assumptions or analysis.
o CBM may have been present, but escaped due to unexpected geological events
o The reservoir may not flow at commercially viable rates of flow.
o The drilling may encounter technical problems which make it impossible or too expensive to reach the target.
o The ability of the Group to exploit and develop gas reserves depends on its current leases. The Group currently has under lease approximately 45,370 acres of prospective coalbed methane lands in the Coos Bay Basin under two major leases and three ancillary leases. There is no guarantee that existing leases will be continued beyond their primary term.
· The Company may take on commitments for which it then cannot find adequate funding. Although the Company can then potentially sell all or part of its assets:
o There is no guarantee it can find a buyer.
o Even if it does find a buyer, the transaction may take too long and the Company's cash resources may become exhausted.
The Company's risk mitigation strategies include the following:
· Partnering with key experts that have demonstrated an ability to predict the presence or absence of hydrocarbons.
· Utilizing the Directors' experience who have excellent local knowledge as to where to seek assets.
· Securing the support of a number of key private shareholders, and actively pursuing other sources of funding.
· Utilizing third parties to assist with the management of currency risk.
Corporate Responsibility
The Company takes its responsibilities as a corporate citizen seriously. The Board's primary goal is to create shareholder value but in a responsible way which serves all stakeholders.
Governance
The Board considers sound governance as a critical component of the Company's success and the highest priority. The Company has an effective and engaged Board, with a strong non-executive presence from diverse backgrounds and well-functioning governance committees. Through the Company's compensation policies and variable components of employee remuneration, the Remuneration Committee of the Board seeks to ensure that the Company's values are reinforced in employee behaviour and that effective risk management is promoted.
Employees and their development
The Company is dependent upon the qualities and skills of its employees and the commitment of its people plays a major role in the Company's business success. Employees' performance is aligned to the Company's goals through an annual performance review process and via incentive programmes. The Company provides employees with information about its activities through regular briefings and other media. The Company operates a share option and warrant scheme operated at the discretion of the Remuneration Committee.
Diversity and inclusion
The Company does not discriminate on the grounds of age, gender, nationality, ethnic or racial origin, non-job-related-disability, sexual orientation or marital status. The Company gives due consideration to all applications and provides training and the opportunity for career development wherever possible. The Board does not support discrimination of any form, positive or negative, and all appointments are based solely on merit.
Health and safety
The Company endeavours to ensure that the working environment is safe and healthy and conducive to the wellbeing of employees who are able to balance work and family commitments. The Company has a Health and Safety at Work policy which is reviewed regularly by the Board and is committed to the health and safety of its employees and others who may be affected by the Company's activities. The Company provides the information, instruction, training and supervision necessary to ensure that employees are able to discharge their duties effectively. The Health and Safety procedures used by the Company ensure compliance with all applicable legal, environmental and regulatory requirements, as well as its own internal standards.
Outlook
The Company's near-term goals are to develop the business of Coos Bay and to focus on the Coal Bed Methane gas sector in Oregon.
The Company has successfully completed two fundraisings and is building a talented team to implement its plans.
We have achieved significant progress and are confident that we can meet the challenges that lie ahead.
Signed by order of the board
Stephen Schoepfer
Chief Executive Officer
Date 30 April 2018
Independent auditor's report to the members of Curzon Energy Plc
Opinion
We have audited the financial statements of Curzon Energy Plc for the year ended 31 December 2017 which comprise the group statements of comprehensive income, the group and parent statements of financial position, the group and parent company statements of cashflows, the group a parent company statements of changes in equity and notes to the financial statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and International Financial Reporting Standards (IFRSs) as adopted by the European Union.
In our opinion, the financial statements:
· give a true and fair view of the state of the group's and company's affairs as at 31 December 2017 and of its loss for the year then ended;
· have been properly prepared in accordance with International Financial Reporting Standards as adopted by the European Union;
· of the parent have been properly prepared in accordance with IFRSs as adopted by the European Union as applied in accordance with the provisions of the Companies Act 2006; and
· have been prepared in accordance with the requirements of the Companies Act 2006.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the Company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC's Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Conclusions relating to going concern
We have nothing to report in respect of the following matters in relation to which ISAs (UK) require us to report to you when:
· The directors' use of the going concern basis of accounting in the preparation of the financial statements is not appropriate; or
· The directors have not disclosed in the financial statements any identified material uncertainties that may cast significant doubt about the Company's ability to continue to adopt the going concern basis of accounting for a period of at least twelve months from the date when the financial statements are authorised for issue.
Overview of our audit approach
Materiality
In planning and performing our audit we applied the concept of materiality. An item is considered material if it could reasonably be expected to change the economic decisions of a user of the financial statements. We used the concept of materiality to both focus our testing and to evaluate the impact of misstatements identified.
Based on our professional judgement, we determined overall materiality for the financial statements as a whole to be £90,000, based on a percentage of total assets.
We use a different level of materiality ('performance materiality') to determine the extent of our testing for the audit of the financial statements. Performance materiality is set based on the audit materiality as adjusted for the judgements made as to the entity risk and our evaluation of the specific risk of each audit area having regard to the internal control environment.
Where considered appropriate performance materiality may be reduced to a lower level, such as, for related party transactions and directors' remuneration.
We agreed with the Audit Committee to report to it all identified errors in excess of £4,000. Errors below that threshold would also be reported to it if, in our opinion as auditor, disclosure was required on qualitative grounds.
Overview of the scope of our audit
There are two components of the Group, Curzon Energy Plc as an entity and the US Group headed by Coos Bay Energy LLC. The audit of Curzon Energy Plc was conducted from the UK. The accounting records were provided to us by management. The company engaged a US firm to undertake the audit work on the US group. The audit was conducted under our direction. We issued instructions to the US firm that detailed the significant risks to be addressed through the audit procedures and indicated the information we required to be reported. We reviewed their working papers and discussed key findings.
Key Audit Matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial statements of the current period and include the most significant assessed risks of material misstatement (whether or not due to fraud) that we identified. These matters included those which had the greatest effect on: the overall audit strategy, the allocation of resources in the audit; and directing the efforts of the engagement team. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.
This is not a complete list of all risks identified by our audit.
Key audit matter | How the scope of our audit addressed the key audit matter |
Valuation of Exploration and evaluation assets The group's primary focus is on exploration activities in the Coos Bay Basin. The exploration assets at 31 December 2017 totalled £2.6m.
We considered the risk that exploration assets are impaired. | We reviewed management's assessment which concluded that there are no facts or circumstances that suggest the recoverable amount of the asset exceeds the carrying amount.
In considering this assessment we reviewed the following sources of evidence: •The primary lease agreement in place supporting the company's right of extraction. •The third party valuation report commissioned by management as well as the competent persons report that formed the basis of the valuation. •Comparing the valuation methodology to the prior year, including the underlying assumptions. •Board minutes, budgets and other operational plans setting out the current plans for the continued commercial appraisal of the asset; • Discussing plans and intentions with management
Key observations
We reviewed the assumptions used in the valuation model and consider them to be reasonable including, natural gas prices, royalty rates, Capex, water disposal and well life. |
Our audit procedures in relation to these matters were designed in the context of our audit opinion as a whole. They were not designed to enable us to express an opinion on these matters individually and we express no such opinion.
Other information
The directors are responsible for the other information. The other information comprises the information included in the annual report, other than the financial statements and our auditor's report thereon. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion the part of the directors' remuneration report to be audited has been properly prepared in accordance with the Companies Act 2006.
In our opinion based on the work undertaken in the course of our audit
· the information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and
· the directors' report and strategic report have been prepared in accordance with applicable legal requirements.
Matters on which we are required to report by exception
In light of the knowledge and understanding of the group and the parent company and their environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:
· adequate accounting records have not been kept by the company, or returns adequate for our audit have not been received from branches not visited by us; or
· the financial statements and the part of the directors' remuneration report to be audited are not in agreement with the accounting records and returns; or
· certain disclosures of directors' remuneration specified by law are not made; or
· we have not received all the information and explanations we require for our audit
Responsibilities of the directors for the financial statements
As explained more fully in the directors' responsibilities statement on page 20, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the directors are responsible for assessing the Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Company or to cease operations, or have no realistic alternative but to do so.
Auditor's responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
We designed our audit approach to be capable of detecting irregularities, including fraud. In particular:
We gained an understanding of the legal and regulatory framework applicable to the Group and considered the risk of acts by the Group which were contrary to applicable laws and regulations, including fraud.
We designed audit procedures to respond to the risk, recognising that the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment
Our tests included, but were not limited to: review of the financial statement disclosures to underlying supporting documentation and enquiries of management. There are inherent limitations in the audit procedures described above and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we would become aware of it.
We did not identify any key audit matters relating to irregularities, including fraud. As in all of our audits we also addressed the risk of management override of internal controls, including testing journals and evaluating whether there was evidence of bias by the directors that represented a risk of material misstatement due to fraud.
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.
Other matters which we are required to address
We were appointed by the Board on 21 November 2017 to audit the financial statements for the year ended 31 December 2017. Our total uninterrupted period of engagement is 2 years, covering the period ended 31 December 2016 to 31 December 2017.
The non-audit services prohibited by the FRC's Ethical Standard were not provided to the company and we remain independent of the group and the parent company in conducting our audit.
Our audit opinion is consistent with the additional report to the audit committee.
Use of our report
This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed.
Matthew Stallabrass
Senior Statutory Auditor
For and on behalf of
Crowe Clark Whitehill LLP
Statutory Auditor
London
30 April 2018
Consolidated statement of comprehensive income
for the year ended 31 December 2017
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| 2017 | 2016 |
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| US$ | US$ |
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Well field expenses |
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| (293,867) | (60,187) |
Administrative expenses |
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| (1,662,619) | (1,035,803) |
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|
|
|
|
Loss from operations |
|
| (1,956,486) | (1,095,990) |
Finance expense, net |
|
| (102,288) | (281,476) |
Impairment of exploration and evaluation assets |
|
|
- |
(2,158,000) |
Other income |
|
| 225,393 | - |
|
|
|
|
|
Loss before taxation |
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| (1,833,381) | (3,535,466) |
Income tax expense |
|
| - | - |
Loss for the year attributable to |
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|
|
|
equity holders of the parent company |
|
| (1,833,381) | (3,535,466) |
|
|
|
|
|
Other comprehensive income/(expense) |
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|
|
|
Gain/(loss) on translation of parent net assets and results from functional currency into presentation currency |
|
| 44,624 | (38,153) |
Total comprehensive loss for the year |
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| (1,788,757) | (3,573,619) |
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|
|
|
|
|
|
|
|
|
Loss per share |
|
|
|
|
Basic and diluted, US$ |
|
| (0.03) | (0.08) |
The notes to these statements are in the Company's Annual Report
Consolidated statements of financial position
as at 31 December 2017
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| 2017 | 2016 |
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| US$ | US$ |
Assets |
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|
|
Non-current assets |
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|
|
Intangible assets |
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| 2,559,000 | 2,559,000 |
Restricted cash |
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| 125,440 | 125,315 |
Total non-current assets |
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| 2,684,440 | 2,684,315 |
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|
|
|
|
Current assets |
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|
|
|
Prepayments and other receivables |
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| 148,616 | - |
Cash and cash equivalents |
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| 1,595,035 | 370,722 |
Total current assets |
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| 1,743,651 | 370,722 |
Total assets |
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| 4,428,091 | 3,055,037 |
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|
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|
|
Liabilities |
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|
|
|
Current liabilities |
|
|
|
|
Trade and other payables |
|
| 463,413 | 581,842 |
Borrowings |
|
| 578,599 | 363,829 |
Total current liabilities |
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| 1,042,012 | 945,671 |
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|
|
|
|
Total liabilities |
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| 1,042,012 | 945,671 |
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|
|
|
|
Capital and reserves attributable to shareholders |
|
|
|
|
Share capital |
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| 964,575 | 639,925 |
Share premium |
|
| 3,199,004 | 763,854 |
Share-based payments reserve |
|
| 114,659 | - |
Warrants reserve |
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| 191,011 | - |
Merger reserve |
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| 31,212,041 | 31,212,041 |
Foreign currency translation reserve |
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| 6,471 | (38,153) |
Accumulated losses |
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| (32,301,682) | (30,468,301) |
Total capital and reserves |
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| 3,386,079 | 2,109,366 |
Total equity and liabilities |
|
| 4,428,091 | 3,055,037 |
The financial statements were approved and authorised for issue by the Board of Directors on 30 April 2018 and were signed on its behalf by:
Thomas Mazzarisi
Director
The notes to these statements are in the Company's Annual Report
Consolidated statements of changes in equity
| Share capital | Share premium | Other reserves | Accumulated losses | Total |
| US$ | US$ | US$ | US$ | US$ |
|
|
|
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|
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Equity as at 1 January 2016 | 530,803 | - | 25,545,285 | (26,948,973) | (872,885) |
Loss for the year | - | - | - | (3,519,328) | (3,519,328) |
Other comprehensive income for the year | - | - | (38,153) | - | (38,153) |
Total comprehensive loss for the year | - | - | (38,153) | (3,519,328) | (3,557,481) |
Issue of shares | 109,122 | 763,854 | - | - | 872,976 |
Increase in additional capital of Coos Bay |
- |
- |
5,666,756 |
- |
5,666,756 |
At 31 December 2016 | 639,925 | 763,854 | 31,173,888 | (30,468,301) | 2,109,366 |
Loss for the year | - | - | - | (1,833,381) | (1,833,381) |
Other comprehensive income for the year | - | - | 44,624 | - | 44,624 |
Total comprehensive loss for the year | - | - | 44,624 | (1,833,381) | (1,788,757) |
Issue of shares | 324,650 | 2,921,855 | - | - | 3,245,505 |
Share issue costs | - | (486,705) | - | - | (486,705) |
Issue of share warrants | - | - | 191,011 | - | 191,011 |
Issue of share options | - | - | 114,659 | - | 114,659 |
At 31 December 2017 | 964,575 | 3,199,004 | 31,524,182 | (32,301,682) | 3,386,079 |
Other Reserves
| Merger reserve | Share-based payments reserve | Warrants reserve | Foreign currency translation reserve | Total Other reserves |
| US$ | US$ | US$ | US$ | US$ |
|
|
|
|
|
|
Equity as at 1 January 2016 | 25,545,285 | - | - | - |
25,545,285 |
Loss for the year | - | - | - | - | - |
Other comprehensive income for the year | - | - | - | (38,153) | (38,153) |
Total comprehensive loss for the year | - | - | - | (38,153) | (38,153) |
Issue of shares | - | - | - | - | - |
Increase in additional capital of Coos Bay |
5,666,756 |
- |
- |
- |
5,666,756 |
At 31 December 2016 | 31,212,041 | - | - | (38,153) | 31,173,888 |
Loss for the year | - | - | - | - | - |
Other comprehensive income for the year | - | - | - | 44,624 | 44,624 |
Total comprehensive loss for the year | - | - | - | 44,624 | 44,624 |
Issue of shares | - | - | - | - | - |
Share issue costs | - | - | - | - | - |
Issue of share warrants | - | - | 191,011 | - | 191,011 |
Issue of share options | - | 114,659 | - | - | 114,659 |
At 31 December 2017 | 31,212,041 | 114,659 | 191,011 | 6,471 | 31,524,182 |
Consolidated statement of cash flows
|
| 2017 | 2016 |
|
| US$ | US$ |
Cash flow from operating activities |
|
|
|
Loss before taxation |
| (1,833,381) | (3,535,466) |
Adjustments for: |
|
|
|
Finance cost, net |
| 86,473 | 344,354 |
Income from payable write off |
| (225,393) | - |
Licences impairment |
| - | 2,158,000 |
Share-based payments charge |
| 111,367 | - |
Unrealised foreign exchange movements |
| 50,184 | (29,004) |
Operating cashflows before working capital changes |
| (1,810,750) | (1,062,116) |
Changes in working capital: |
|
|
|
Increase in payables |
| 66,576 | 209,637 |
(Increase) in receivables |
| (118,542) | - |
Net cash used in operating activities |
| (1,862,716) | (852,479) |
|
|
|
|
Financing activities |
|
|
|
Issue of ordinary shares |
| 3,087,266 | 872,979 |
Costs of share issue |
| (295,694) | - |
Proceeds from new borrowings |
| 250,000 | 350,815 |
Net cash flow from financing activities |
| 3,041,572 | 1,223,794 |
Net Increase in cash and cash equivalents in the period |
| 1,178,856 | 371,315 |
|
|
|
|
Cash and cash equivalents at the beginning of the period |
| 370,722 | 515 |
Restricted cash held on deposits |
| 125,315 | 124,424 |
Total cash and cash equivalents at the beginning of the period, including restricted cash |
| 496,037 | 125,019 |
|
|
|
|
Effect of the translation of cash balances into presentation currency |
| 45,457 | (1,187) |
Interest on restricted cash |
| 125 | 891 |
Cash and cash equivalents at the end of the period |
| 1,595,035 | 370,722 |
Restricted cash held on deposits |
| 125,440 | 125,315 |
Total cash and cash equivalents at the end of the period, including restricted cash |
| 1,720,475 | 496,037 |
|
|
|
|