Riverstone Cred Regulatory News (RCOI)

Riverstone Credit Opportunities Income Plc

Annual Report and Financial Statements

For the period ended 31 December 2019

AN INVESTMENT STRATEGY established to generate strong risk-adjusted returns within energy credit

Riverstone Credit Opportunities Income Plc is an externally managed closed-ended investment company trading on the Main Market of the London Stock Exchange as part of its IPO, which completed on 28 May 2019.

The Company's Ordinary Shares were admitted to the Specialist Fund Segment of the London Stock Exchange plc's Main Market and incorporated and registered on 11 March 2019 in England and Wales with an unlimited life.

The Company's Investment Manager is Riverstone Investment Group LLC, which is controlled by affiliates of Riverstone.

Riverstone is an energy and power-focused private investment firm founded in 2000 by David M. Leuschen and Pierre F. Lapeyre with approximately $39 billion of capital raised. Riverstone conducts buyout, growth and credit investments in the E&P, midstream, energy services, power and coal sectors of the global energy industry. With offices in New York, London, Houston, Mexico City and Amsterdam, the firm has committed approximately $39 billion to 175 investments in North America, South America, Europe, Africa, Asia and Australia.

The registered office of the Company is 27-28 Eastcastle Street, London, W1W 8DH.

All capitalised terms are defined in the list of defined terms below unless separately defined.

Key Financials

Highlights

·; The Company successfully raised gross proceeds of $100 million at IPO on 28 May 2019.

·; The NAV at 31 December 2019 was $1.014 per share.

·; Dividend of 2.57 cents per share approved with respect to the period ended 31 December 2019.

·; 8 investments and 1 full realisation executed in the period ended 31 December 2019.

Chairman's Statement

Challenging macro dynamics within energy create an attractive opportunity

On behalf of the Board, I am pleased to present the first Annual Report for Riverstone Credit Opportunities Income plc ("RCOI" or the "Company") after a successful eight months of operation. In May 2019, the Company raised $100 million in its initial public offering and established itself as the first investment fund listed on the London Stock Exchange focussed on investing in energy credit.

RCOI was formed to deliver consistent income distributions and attractive long-term returns to investors, primarily by executing senior secured debt investments in small and middle-market energy-related companies. The Company seeks to take advantage of a favourable market opportunity to create value for shareholders while maintaining a conservative investment strategy that focusses on mitigating risk. RCOI is able to achieve these objectives through its differentiated approach. RCOI provides customised financing solutions that meet Borrowers needs, whilst being of short duration and offering provisions and protections against the downside.

RCOI has been actively deploying its capital into income-generating investments and declared its first dividend of 2.57 cents per Ordinary Share for the period from 28 May 2019 to 31 December 2019.

The Market Environment

Over the past five years, the energy industry has faced one of most severe and prolonged downturns in recent history due to sharp declines and volatility in commodity prices. This macro environment has considerably impacted the traditional bank lending market as well as the capital markets, which have become virtually inaccessible to energy-related companies. Public debt issuance in 2019 was at the lowest level seen in several years despite an over $20 billion offering completed by Occidental to fund its acquisition of Anadarko, while public equity issuance was at the lowest volumes experienced in two decades. Even though companies of all sizes have been affected by these difficult conditions, small to middle-market energy issuers have faced an especially pronounced tightening of capital availability. This dynamic has proven to be particularly challenging for these companies due to the high capital requirements to fund growth and support cash flow generation.

The limited financing available for energy-related companies has created an attractive opportunity for RCOI to capitalise on due to a growing investment universe of potential borrowers. With long-standing industry experience and the support of one of the largest private investment firms within energy, the Company is well-positioned to leverage its relationships and deep technical expertise to originate and execute upon its investment pipeline. At the same time, RCOI is focussed on exercising discipline in its approach to ensure that it invests in transactions that are not only able to produce strong economic returns, but have an identifiable path to realisation.

Performance

The Company reported a profit of $3,351k for the period ending 31 December 2019 as a result of income received from the investment portfolio and an increase in the portfolio's valuations. The Net Asset Value ("NAV") of the Company ended the period at $1.014 per share, representing an increase of 2.9 per cent. from the ending NAV on 30 June 2019 of $0.985 per share.

RCOI has executed eight investments since inception and ended the year with seven investments after its first full realisation of Project Shiner in December. The Company has actively focussed on portfolio construction and diversified its exposure across the exploration & production, midstream, and energy services sectors to reduce risk. As of 31 December 2019, RCOI had committed 82 per cent. of the fund to investments and had $43.7 million net invested, equating to 44 per cent. of net capital available, and a cash balance of $61 million, including cash held at the SPVs. Capital that has been committed but not yet invested continues to generate income through undrawn fees.

Events after the Reporting Period

On 14 January 2020, the Company purchased an allocation in Project Beach II, a first lien term loan that was previously originated by and currently in the portfolio of Riverstone's private credit funds. At closing, $8.7 million was committed by the Company. The first lien term loan was then subsequently realised on 28 January 2020.

In closing, I would like to thank our shareholders for your continued support. The Board has been pleased with the progress that RCOI has made through its prudent deployment of capital and looks forward to providing additional updates.

Reuben Jeffery, III

Chairman

19 February 2020

Strategic Report

The Directors present their Strategic Report for the period ended 31 December 2019. Details of the Directors who held office during the period and as at the date of this report are given below.

Investment Objective

The Company seeks to generate consistent shareholder returns predominantly in the form of income distributions, principally by making senior secured loans to energy-related companies.

Investment Policy

The Company seeks to achieve its investment objective through investing in a diversified portfolio of direct and indirect investments in loans, notes, bonds and other debt instruments, including convertible debt, issued by Borrowers operating in the energy sector. The Company may also invest in warrants or other equity interests or instruments received in connection with, or as a consequence of, an investment in the loans.

Investment Strategy

The Investment Manager seeks to leverage the wider Riverstone platform to enhance its investment strategy through the synergies gained from being part of one of the largest dedicated energy focused private equity firms.

The key elements of the Investment Manager's investment strategy in relation to the Company and its SPVs are summarised below.

Core Strategy - Direct Lending

The Investment Manager will be primarily focused on originating opportunities from small to middle-sized energy-related companies in what the Riverstone team call the ''Wedge''; companies too small for the capital markets and without the conforming credit metrics that allow access to the commercial bank market.

All investments directly originated by the Company's SPVs are expected to involve providing primary capital to the Borrower, after having completed a thorough and comprehensive due diligence process. In each case the Riverstone team will be able to influence terms and conditions. In many cases, direct investments are expected to be held solely by the Company's SPVs, in some cases alongside Other Riverstone Funds. In others, the Company's SPVs (and Other Riverstone Funds) may be a member of a syndicate arranged by a third party.

The Investment Manager expects that lending investments made directly by the Company's SPVs will have a contractual duration of three to five years from inception and an expected duration of one to two years. The maximum term of any investment made by the Investment Manager will be 7 years.

Complimentary Strategies - Capital Relief and Market-Based Opportunities

The Investment Manager may be presented with opportunities to acquire from banks' so-called ''non-conforming'' loans which can no longer be held on bank balance sheets. The Investment Manager expects that such ''capital relief'' transactions will be secondary in nature, will typically be based on public due diligence information and will typically not allow the Company to influence the underlying terms of the relevant Investment. The Investment Manager expects that, in capital relief transactions, the Company may participate as part of a broader syndicate of third-party lenders. The Investment Manager expects capital relief transactions made by the Company's SPVs to have a duration of one to three years from inception and an expected duration of less than 12 months.

Riverstone believes that the same trends which make it difficult for smaller Borrowers to access capital markets may create attractive opportunities for investors such as the Company to acquire syndicated loans and bonds in the open market at risk-adjusted returns that match or exceed the returns available from direct lending opportunities. In such circumstances, the Company's SPVs may make selected investments in the secondary market for syndicated loans and bonds where the Investment Manager believes that such instruments offer suitable risk adjusted returns.

The Investment Manager expects market-based opportunities generally to be secondary in nature, typically to be based on public due diligence information and may, typically, not allow the Company any influence on the underlying terms of the investment. The Investment Manager expects market-based opportunities will typically involve the Company's SPVs being part of a broader syndicate of lenders.

Investment Restrictions

The Company observes the following investment restrictions:

·; no more than 15 percent of the Company's gross assets will be exposed to any single Borrower, its parents, subsidiaries and/or sister subsidiary entities;

·; at least 85 percent of the Company's gross assets will be invested directly or indirectly in aggregate, in cash and loans which are secured as to repayment of principal and payment of interest by a first or second priority charge over some or all of such entity's assets and cash;

·; the Company will only invest in an underlying Borrower group, when that Borrower group has a total indebtedness (including the Company's investment) of less than 60 percent of the Borrower group's asset base;

·; the Company will not invest in any undertaking in which Riverstone Holdings LLC (or any of its subsidiary undertakings) has an equity interest, other than an undertaking in which the Company and one or more Other Riverstone Funds hold, or will as a result of the relevant investment hold, related equity interests acquired at substantially the same time as part of the same transaction or a series of linked transactions; and

·; the maximum term of any investment made by the Company will be 7 years.

Each of these investment restrictions will be calculated and applied as at the time of investment.

Dividend policy

Subject to market conditions, applicable law and the Company's performance, financial position and financial outlook, it is the Directors' intention to declare dividends to Shareholders on a quarterly basis following publication of the NAV per Ordinary Share calculated as of the final day of the relevant quarter.

Starting with the first quarter of the 2020 calendar year, the Company intends to declare dividends with respect to 100 percent of its net income (as calculated for UK tax purposes). However, in any calendar year the Company may retain an amount equal to up to 15 percent of its net income (as calculated for UK tax purposes) if the Board determines that it would be in the longer-term interests of the Company to do so (for instance, in the event of any permanent loss of capital by the Company).

The declaration of any dividend will be subject to payment of the Company's expenses and any legal or regulatory restrictions at the relevant time. The Company may elect to designate as an ''interest distribution'' all or part of any amount it distributes to Shareholders as dividends.

As disclosed in note 14 to the financial statements, on 19 February 2020 the Board approved a dividend of 2.57 cents per share with respect to the period ended 31 December 2019. The record date for the dividend is 28 February 2020 and the payment date is 27 March 2020.

Structure

The Company makes its investments through its SPVs. Riverstone International Credit Corp. is a corporation established in the State of Delaware and is a wholly-owned subsidiary of the Company (''USCo''). USCo, in turn, invests through Riverstone International Credit - Direct L.P., a limited partnership established in the State of Delaware in which USCo is the sole limited partner. Investments may also be made through Riverstone International Credit L.P., a limited partnership established in the State of Delaware in which the Company is the sole limited partner. The general partner of each of the limited partnerships is a member of Riverstone's group.

The Company has contributed or lent substantially all of its Net Issue Proceeds (net of short-term working capital requirements) to its SPVs which, in turn, make investments in accordance with the Company's investment policy. The Investment Manager draws on the resources and expertise of the wider Riverstone group.

Discount Control

It is the intention of the Board for the Company to buy back its own shares if the share price is trading at a material discount to NAV, providing that it is in the interests of Shareholders to do so. Shares which are bought back may be cancelled or held in treasury.

Review of Business and Future Outlook

Details of the underlying portfolio and a review of the business in the period, together with future outlook are covered in the Investment Manager's Report below.

Key Performance Indicators

The Board believes that the key metrics detailed above, will provide Shareholders with sufficient information to assess how effectively the Company is meeting its objectives.

Ongoing Charges

Ongoing charges are an alternative performance measure and the ongoing charges ratio of the Company is 1.01 percent of the weighted average NAV for the period to 31 December 2019. This is made up as follows and has been calculated using the AIC recommended methodology.

The Investment Manager is entitled to a Profit Share when it meets relevant performance targets as disclosed in note 12 to the financial statements.

Corporate and Social Responsibility

Environmental, Social and Governance Matters

The Company relies on the Investment Manager to apply appropriate environmental, social and governance ("ESG") policies to the investments the Company makes. The Company's approach to responsible investing is set out in policies in place at the Investment Manager.

As part of one of the most experienced private investment firms within energy, power and infrastructure, the Company recognises the ever-increasing importance of ESG and has made the proactive implementation of ESG initiatives one of its highest priorities. RCOI takes its responsibility to investors very seriously and believes that a strong commitment to managing ESG factors is critical to the success of its portfolio companies. By devoting substantial internal and external resources to managing ESG, the Investment Manager has developed clear processes to ensure that it meets leading industry standards and makes socially responsible decisions over the long-run.

ESG Policy

The Investment Manager has created an ESG Policy that codifies its approach to overseeing all key ESG factors, such as environmental regulations, health and safety, community and stakeholder impact, governance, natural resource management, climate change, greenhouse gas emissions, among many others. This policy helps inform how it actively integrates ESG considerations both into the management of the Company's portfolio companies from initial due diligence to an exit as well as the Investment Manager's own firm operations. Since inception, the Investment Manager has continuously evolved its policy in conjunction with third-party ESG subject matter experts to make sure that it reflects best practices. The Investment Manager's ESG Policy may be found at www.riverstonellc.com/documents/Riverstone_ESG_Policy_Statement.pdf.

Policy Implementation

To implement its ESG Policy, the Investment Manager has established a formal ESG Committee, which oversees institutional processes that support the ability to meet high ESG standards. These procedures were developed to achieve several key objectives:

1) Provide investment professionals and portfolio companies with adequate training and access to ESG resources

2) Identify potential risks and mitigants before an investment is made

3) Active portfolio monitoring to immediately remediate any issues that may arise and track ongoing performance

4) Evaluate and execute opportunities to improve current practices at portfolio companies as well as at the Investment Manager's own institution

ESG Throughout the Investment Lifecycle

The Investment Manager has a consistent process for managing ESG in all of its portfolio companies across strategies and applies the same standard to the investments in RCOI. Accordingly, ESG considerations are reviewed before an investment is made and monitored until an investment is fully realised. Core aspects of the Investment Manager's ESG programme that are applied to RCOI's portfolio companies include:

RISK IDENTIFICATION

·; Use the Investment Manager's deep industry expertise to identify relevant ESG risks and mitigating factors for each new potential investment

DUE DILIGENCE

·; Thorough evaluation of key ESG risks for each potential investment and determination of whether appropriate remedies can be implemented for risks identified

·; Engage third party experts to evaluate specific risks and areas of concern

INVESTMENT COMMITTEE

·; Complete ESG risk assessment as part of the Investment Committee memo for potential investments, within the context of the investment's broader risk analysis

·; Include third party assessments and reference checks

ONGOING MONITORING AND PORTFOLIO MANAGEMENT

·; Active engagement and dialogue with each portfolio company to ensure that any incidents or issues that arise are immediately addressed

·; Ongoing monitoring occurs through monthly calls with the borrowers and receipt of quarterly financials that are often delivered with a fulsome company update

·; These processes above help identify any material ESG concerns and identify when remediation would be needed across environmental, health & safety, insurance, governance and other areas

Key ESG considerations that are reviewed during due diligence and an on ongoing basis include:

ESG INITIATIVES GOING FORWARD

The Company and Investment Manager believe that managing ESG effectively requires near continuous improvement and will continue to adapt to best practices that reflect a constantly evolving world. Key ESG goals for the near-future include:

• Work to become a signatory of the UNPRI

• Publish the Investment Manager's first standalone ESG report

• Enhance and expand ESG diligence and monitoring checklists for portfolio companies

• Increase the Investment Manager's internal ESG initiatives including working towards a lower carbon footprint, reducing natural resource usage, and diversity recruiting

The Board and Investment Manager strongly believe that having diversity in skills, experience and gender has significant benefits. The Board currently comprises three Independent Directors based on merit-based qualifications, while also having gender balance. The Investment Manager has a diverse employee base and continues to dedicate recruiting resources to increasing its diversity across all positions and levels.

The Company's policy on diversity is further detailed in the Corporate Governance Report below.

The Company does not have any employees and therefore employee policies are not required. The Directors of the Company are detailed below.

Principal Risks and Uncertainties

Under the FCA's Disclosure and Transparency Rules, the Directors are required to identify those material risks to which the Company is exposed and take appropriate steps to mitigate those risks. Risks relating to the Company are disclosed in the Company's prospectus which is available on the Company's website www.riverstonecoi.com.

The Company's assets consist of investments, through SPVs, within the global energy industry, with a particular focus on opportunities in the global E&P and midstream energy sub-sectors. Its principal risks are therefore related to market conditions in the energy sector in general, but also the particular circumstances of the businesses in which it is invested. The Investment Manager seeks to mitigate these risks through active asset management initiatives and by carrying out due diligence work on potential targets before entering into any investments.

The Board thoroughly considers the process for identifying, evaluating and managing any significant risks faced by the Company on an ongoing basis and these risks are reported and discussed at Board meetings. The Board ensures that effective controls are in place to mitigate these risks and that a satisfactory compliance regime exists to ensure all applicable local and international laws and regulations are upheld.

For each material risk, the likelihood and consequence are identified, management controls and frequency of monitoring are confirmed and results reported and discussed at the quarterly Board meetings.

The key areas of risk faced by the Company and mitigating factors are summarised below:

1. The Company has a limited operating history and relies on the past history and relationships of the Investment Manager to make suitable investments. The Investment Manager is well resourced and has access to the wider skills and expertise at Riverstone, including significant experience in originating, structuring, underwriting and syndicating loans and bonds.

2. The ability of the Company to meet the target dividend will depend on the Investment Manager's ability to identify and manage suitable investments in accordance with the Investment Policy. The Investment Manager's primary focus is direct lending to top class middle-market energy-related companies, a growing investment universe with limited competition capable of generating attractive risk-adjusted returns.

3. The Company will only lend to Borrowers in the global energy sector, and such single industry concentration could affect the Company's ability to generate returns, and adverse market conditions in that sector may delay or prevent the Company from making appropriate investments that generate attractive returns. The Investment Manager is constructing a portfolio of investments that is diverse within the energy industry, investing across the entire energy value chain, reviewing opportunities in the upstream, midstream, and downstream sub-sectors.

4. The absence of a substantial secondary market and liquidity for the Company's investments means that the Company may be unable to realise value from its investments and investors could lose all or part of their investment. The Investment Manager executes proper due diligence on each potential investment before recommending the commitment of funds.

5. The Ordinary Shares may trade at a discount to NAV per Share for reasons including but not limited to market conditions, liquidity concerns and actual or expected Company performance. As such, there can be no guarantee that attempts to mitigate such discount will be successful or that the use of discount control mechanisms will be possible, advisable or adopted by the Company. It is the intention of the Board for the Company to buy back its own shares if the share price is trading at a material discount to NAV, providing that it is in the interests of Shareholders to do so.

6. The Investment Manager will be subject to investment advisory regulatory oversight in the United States. Failure of the Investment Manager or other Riverstone entities to comply with US regulatory requirements could prevent the Investment Manager from providing services to the Company under the Investment Management Agreement to the detriment of investors in the Company. The Investment Manager closely monitors and reacts to any developments in regulatory requirements, under consultation with appropriate parties.

7. Any change in the tax status of the Company, its SPVs, or the tax status of Borrowers, or in taxation legislation or practice generally (whether in the UK, US or elsewhere) could affect the value of the investments held by the Company, alter the post-tax returns to Shareholders, or affect the tax treatment for Shareholders of their investments in the Company and returns therefrom. The Investment Manager closely monitors and reacts to any developments in taxation legislation, under consultation with appropriate parties.

8. There is a risk of non-compliance with laws and regulations. The Company has established policies and procedures designed to assist personnel, entities and businesses in which it invests with complying with applicable laws and regulations.

9. The Investment Manager is dependent upon the expertise of key personnel in providing investment management services to the Company. The Investment Manager is well resourced and has access to the wider skills and expertise at Riverstone.

10. The Company has appointed third party service providers and failure by any service provider to carry out its obligations could have a materially detrimental impact on the operation of the Company. Service providers have been selected and engaged based on due diligence and references including consideration of their internal controls and expertise. The Company has established a Management Engagement Committee to review the performance of the service providers on an ongoing basis.

11. Any loss of data or security breach of the Company's IT systems could have adverse impacts on the operations and reputation of the Company. The Investment Manager has risk management strategies, systems, policies and procedures to seek to prevent cyber incidents, as well as established business continuity plans.

Going Concern

The Company retained $10.0 million of cash from the IPO. After settlement of share issue and expenses for the period, the cash balance at 31 December 2019 was $8.5 million, which is sufficient to cover the Company's existing liabilities of $0.3 million and dividend of $2.6 million with respect to the period ending 31 December 2019.

The Directors have also reviewed the Company's forecasts and projections which cover a period of at least 12 months from the date of this report, taking into account foreseeable changes in investment and trading performance, which show that the Company has sufficient financial resources.

The Company's cash balance comprises cash and money market fixed deposits and the Company has no material going concern risk. Uninvested cash earned approximately 191 basis points during the period ended 31 December 2019.

In light of the above facts, the Directors are satisfied that it is appropriate to adopt the going concern basis in preparing the financial statements. In reaching this conclusion, the Board has considered budgeted and projected results of the business, projected cash flow and risks that could impact the Company's liquidity over the next 12 months.

Longer Term Viability

As required by the AIC Code, the Directors have assessed the prospects of the Company over a longer period than required by the going concern provision. The Company's investments have a maximum term of 7 years and are expected to have a contractual duration of 3 to 5 years from inception, therefore the Board chose to conduct a review for a period of three years to 31 December 2022. On a rolling basis, the Directors will evaluate the outcome of the investments and the Company's financial position as a whole.

Each quarter, the Board reviews threats to the Company's viability utilising the risk matrix and update as required due to recent developments and/or changes in the global market. The Board relies on periodic reports provided by the Investment Manager and Administrator regarding risks faced by the Company. When required, experts are utilised to gather relevant and necessary information, regarding tax, legal, and other factors.

The Investment Manager considers the future cash requirements of the Company before funding portfolio companies. Furthermore, the Board receives regular updates from the Investment Manager on the Company's cash position, which allows the Board to maintain its fiduciary responsibility to the Shareholders and, if required, limit funding for existing commitments.

Based on the aforementioned procedures and the existing internal controls of the Company and Investment Manager, the Board has concluded there is a reasonable expectation that the Company will be able to continue in operation and meet its liabilities as they fall due over the three-year period of the assessment.

In support of this statement, the Directors have taken into account all of the principal risks and their mitigation as identified in the Principal Risk and Uncertainties section above, the nature of the Company's business; including the cash reserves and money market deposits of the Company and its SPVs, the potential of its portfolio of investments to generate future income and capital proceeds, and the ability of the Directors to minimise the level of cash outflows, if necessary.

Directors' Responsibilities Pursuant to Section 172 of the Companies Act 2006

The Directors are responsible for acting in a way that they consider, in good faith, is the most likely to promote the success of the Company for the benefit of its members. In doing so, they should have regard for the needs of stakeholders and the wider society. Key decisions are those that are either material to the Company or are significant to any of the Company's key stakeholders, as described below. The below key decisions were made or approved by the Directors during the year, with the overall aim of promoting the success of the Company while considering the impact on its members, stakeholders and the wider society as outlined in the ESG section above.

Listing

On 28 May 2019, the Company successfully raised gross proceeds of $100 million at IPO. The Company issued a prospectus in advance of listing and the Directors, Investment Manager and the Company's broker engaged with analysts and potential investors throughout the process.

Investment policy

The Company invests in a diversified portfolio of direct and indirect investments in loans, notes, bonds and other debt instruments. The Investment Manager adopts a responsible investing approach and the Board has reviewed and approved the investment policy. The Board and the Investment Manager monitor the concentration of the investment in the SPVs on a quarterly basis to ensure compliance with the investment policy. The Company has completed 8 investments and 1 realisation as at 31 December 2019.

Dividend policy

The Board has reviewed and approved the Company's dividend policy during the period. On 19 February 2020, the Board approved a dividend of 2.57 cents per share and will target dividends equal to a yield of between 8 percent and 10 percent per annum on the issue price at IPO.

Board Committees

The Board has formed an Audit and Risk Committee, Nomination Committee and Management Engagement Committee in order to establish a good corporate governance framework for the Company. The Chairman of each committee will attend the AGM to answer any questions on their committee's activities.

Engagement with Shareholders

The Company reports to Shareholders in a number of formal ways, including its Annual Report, Interim Report and regulatory news releases, all of which are approved by the Board. In addition, the Company's website contains comprehensive information for Shareholders and the Company's AGM provides a forum for Shareholders to meet and discuss issues with the Directors.

Annual General Meeting

The AGM of the Company will be held at 10.00am BST on 21 May 2020 at the offices of Hogan Lovells International LLP, Atlantic House, Holborn Viaduct, London EC1A 2FG. Details of the resolutions to be proposed at the AGM, together with explanations, will appear in the notices of meetings to be distributed to Shareholders in April 2020. As a matter of good practice, all resolutions will be conducted on a poll and the results will be announced to the market as soon as possible after the AGM.

Members of the Board, including the Chairman and the Chairperson of each Committee, will be in attendance at the AGM and will be available to answer Shareholder questions.

On behalf of the Board

Reuben Jeffery, III

Chairman

19 February 2020

Investment Manager's Report

Focused on capitalising on the growing investment universe in the middle-market for energy lending

About the Investment Manager

Appointed in May 2019, the Investment Manager, an affiliate of Riverstone, will seek to generate consistent shareholder returns predominantly in the form of income distributions principally by making senior secured loans to energy-related companies. The Company will seek to achieve its investment objective predominantly through investing in a diversified portfolio of direct and indirect investments in loans, notes, bonds and other debt instruments, including convertible debt, issued by Borrower's operating in the energy sector. Riverstone's investment professionals have a combination of industry knowledge, financial expertise and operating capabilities. The Company will also benefit from the guidance and input provided by non-Riverstone Credit Team members of Riverstone's credit investment committee who will be involved in the Company's investment process. The Company believes that Riverstone's global network of deep relationships with management teams, investment banks and other intermediaries in the energy sector will lead to enhanced sourcing and deal origination opportunities for the Company.

Investment Portfolio Summary

The Investment Manager has reviewed numerous opportunities within the Investment Guidelines since RCOI's Admission. As of 31 December 2019, eight investments have been completed; four for exploration and production companies, three for midstream companies and one for a services company, as further discussed below. One realisation has also occurred in an exploration and production company. The Investment Manager continues to maintain a strong pipeline of investment opportunities and expects to make a number of further commitments. RCOI will make investments in accordance with the limitations illustrated in the Company's Investment Restrictions.

In the descriptions that follow, yield to maturity is inclusive of all upfront fees, original issue discounts, drawn spreads and prepayment penalties through the stated maturity of the loan. Most loans have incentives to be called early. A portion of the loans have a "payment-in-kind" feature for drawn coupons for a limited time period. Similarly, some of the loans have a "delayed-draw" feature that allows the Borrower to call capital over time, but always with a hard deadline. Loans that are committed are loans with signed definitive documentation where a structuring fee and/or original issue discount have been earned and the Company earns an undrawn spread. Loans that are invested are loans with signed definitive documentation where a structuring fee and/or original issue discount have been earned, the Company has funded the loan to the Borrower and the Company is earning a drawn coupon.

Project Yellowstone - RCOI participated in a $25.0 million upsize of RCP's commitment to a $105.0 million first lien term loan for a privately-owned, midstream company that provides fluids management, primarily produced water hauling, flow-back management, and salt-water disposal infrastructure in the SCOOP, STACK, and MERGE plays in Central Oklahoma. RCP closed the initial $105.0 million financing in November 2018. The term loan upsize closed in May 2019.

At closing, $5.8 million was committed by RCOI and is fully invested. The first lien term loan has a maturity of November 2021 and an all-in expected yield to maturity of 13.6% on a fully drawn basis.

Use of proceeds was to fund an acquisition.

As of 31 December 2019, the full commitment has been invested.

Project Alp - RCOI participated in a $55.0 million first lien delayed-draw term loan to a sponsor-backed exploration & production company with operations focused in the Northern Delaware Basin of New Mexico. The term loan closed in June 2019.

At closing, $13.3 million was committed by RCOI. As of 30 June 2019, the term loan was fully undrawn. The first lien term loan has a maturity of June 2020 and an all-in expected yield to maturity of 13.7% on a fully drawn basis.

Use of proceeds from the credit facility is to fund capital expenditures in Lea County, NM subject to compliance with an Approved Plan of Development and to pay fees, costs and expenses related to the term loan.

As of 31 December 2019, $5.7 million of the original commitment has been invested.

Project Mariners - RCOI participated in a $140.0 million first lien delayed-draw term loan for a privately-owned company that provides vessel and logistic services including tugboat, ship assist, and escort services, and cargo handling and towing predominantly focused on the energy sector.

The Company is headquartered in Houston, TX with navigation centres in Ingleside, TX, Brownsville, TX, Pascagoula, MS, and Jacksonville, FL as well as a shipyard and repair facility in Pascagoula, MS. The term loan closed in July 2019.

At closing, $14.9 million was committed by RCOI which was reduced to $12.2 million via a secondary sale. The first lien term loan has a maturity of July 2022 and an all-in expected yield to maturity of 12.6% on a fully drawn basis.

Use of proceeds was to fund the recapitalisation of the Company to settle all indebtedness, fund the refurbishment of two motor vessels, and to pay fees, costs and expenses related to the term loan.

As of 31 December 2019, the full commitment has been invested.

Project Remington - RCOI participated in a $10.0 million upsize of RCP's commitment to a $65.0 million first lien Holdco term loan for a sponsor-backed Bakken focused midstream company that provides crude oil and natural gas gathering and processing, produced water transportation and disposal, and freshwater sourcing and transportation. RCP closed the initial $65.0 million financing in June 2018. The term loan upsize closed in August 2019.

At closing, $3.4 million was committed by RCOI. The first lien holdco term loan has a maturity of June 2022 and an all-in expected yield to maturity of 11.8% on a fully drawn basis.

Use of proceeds, combined with an Opco revolving credit facility draw, was to fund an acquisition.

As of 31 December 2019, the full commitment has been invested.

Project Chase - RCOI participated in a $50.0 million first lien delayed-draw term loan to a sponsor-backed exploration & production company with operations focused in the dry gas window of the Eagle Ford Basin. The term loan closed in July 2019.

At closing, $12.3 million was committed by RCOI. The first lien term loan has a maturity of July 2021 and an all-in expected yield to maturity of 13.3% on a fully drawn basis.

Use of proceeds from the credit facility is to fund capital expenditures in Webb and La Salle Counties, other capital expenditures relating to existing and future upstream assets, and operating expenses.

As of 31 December 2019, $1.6 million of the original commitment has been invested.

Project Ducks - RCOI participated in a $65.0 million first lien delayed-draw term loan to a sponsor-backed exploration & production company focused on the acquisition and unconventional development of oil and gas properties in the DJ Basin of Colorado. The term loan closed in November 2019.

At closing, $13.8 million was committed by RCOI. The first lien term loan has a maturity of November 2022 and an all-in expected yield to maturity of 14.1% on a fully drawn basis.

Use of proceeds is to repay the existing RBL, fund D&C activity in northeast Weld County subject to a plan of development, fund midstream and certain leasehold extension payments and pay related transaction fees and expenses.

As of 31 December 2019, $6.8 million of the original commitment has been invested.

Project Knox - RCOI participated in a $75.0 million first lien delayed-draw term loan to a sponsor-backed midstream company that will provide propane purity offtake transportation to the Houston, TX export market. The term loan closed in December 2019.

At closing, $14.8 million was committed by RCOI. The first lien term loan has a maturity of December 2022 and an all-in expected yield to maturity of 11.6% on a fully drawn basis.

Use of proceeds from the credit facility is for the construction of a new propane pipeline from Robstown and Corpus Christi, TX to Sweeney, TX.

As of 31 December 2019, $4.0 million of the original commitment has been invested.

In terms of realisations, Project Shiner, a $6 million first lien commitment made in June 2019 with a July 2021 maturity, has been repaid early by the sponsor-backed operator. The Company received $4.9 million on the $4.3 million invested (as at December 31, 2019) which represented a 49.1% IRR and a 1.15x Multiple on Invested Capital.

The Investment Manager continues to believe that this is a market where patience and a disciplined approach to investing are likely to be well rewarded.

Subsequent Events and Outlook

The investment opportunity for RCOI remains robust with several actionable E&P, midstream and services focused investments in various stages of review and negotiation. Since the end of the fourth quarter 2019, RCOI has participated in the investment below. Through this investment, RCOI is currently 76% committed we expect the remaining balance of RCOI to be committed from the strong investment pipeline. In each deal, RCOI will invest pro rata to other RCP managed vehicles based on their available capital.

Project Beach II - On 14 January 2020, the Company purchased an allocation in a first lien term loan that was previously originated by and currently in the portfolio of Riverstone's private credit funds. At closing, $8.7 million was committed by the Company. The first lien term loan was realised on 28 January 2020.

Board of Directors

Reuben Jeffery, III

CHAIRMAN

Mr. Jeffery has a broad range of financial services experience, particularly investment banking, and in addition brings extensive insight into the US political and regulatory environment. He was previously the President and CEO of Rockefeller Financial Services, Inc. and recently stepped down as a non-executive Director of Barclays Plc. In addition, Mr. Jeffery has served in the US government as Under Secretary of State for Economic, Energy and Agricultural Affairs between 2007 and 2009. Mr. Jeffery also served as Chairman of the Commodity Futures Trading Commission, and as a special assistant to the President on the staff of the National Security Council.

Before his government service, Mr. Jeffery spent 18 years at Goldman Sachs & Co where he was Managing Partner of Goldman Sachs in Paris and led the firm's European Financial Institutions Group in London. Prior to joining Goldman Sachs, Mr. Jeffery was a corporate attorney with Davis Polk & Wardwell.

Mr. Jeffery is a graduate of Yale University and holds an M.B.A. and J.D. from Stanford University.

Emma Davies

DIRECTOR, CHAIR OF AUDIT AND RISK COMMITTEE

Ms. Davies is Head of Direct Investments at Marylebone Partners, an independent wealth management firm.

Ms. Davies was previously Head of Property and Infrastructure at The Welcome Trust, where she also helped to manage the public markets portfolio. She was formerly CIO of Big Society Capital and ran the European investments team for Perry Capital.

Ms. Davies is a graduate of Oxford University and holds an MSc from the London School of Economics.

Edward Cumming-Bruce

DIRECTOR, CHAIR OF NOMINATION COMMITTEE

Mr. Cumming-Bruce is the Vice Chairman of Gleacher Shacklock LLP, who he joined in August 2003. Prior to this, he worked for 12 years at Dresdner Kleinwort Wasserstein where he held a number of senior positions including a Co-Head of Global Telecoms Investment Banking, Co-Head of UK Investment Banking and Global Head of Equity Capital Markets.

Mr. Cumming-Bruce has extensive experience advising a range of major European companies on capital markets and restructuring transactions as well as mergers and acquisitions. Prior to Dresdner Kleinwort Wasserstein, he worked at Schroders.

Mr. Cumming-Bruce is a graduate of Oxford University.

Report of the Directors

The Directors present their Annual Report and audited financial statements for the Company for the period ended 31 December 2019. The Corporate Governance Report below forms part of this report.

Details of the Directors who held office during the period and as at the date of this report are given above.

Capital Structure

To enable the Company to obtain a certificate to commence business and to exercise its borrowing powers under section 761 CA 2006, on 11 March 2019, 1 E Share of £1 and 50,000 shares of £1 each were allotted to Riverstone Investment Group LLC and paid up in full, as Management Shares. The E Share and Management Shares grant the registered holders the right to receive notice of and to attend but, except where there are no other shares of the Company in issue, not to speak or vote at any general meeting of the Company. The Management Shares were redeemed in full on 28 May 2019 out of the proceeds of the IPO. The E Shares are not redeemable.

As at 31 December 2019, the Company's issued share capital comprised 100,000,000 Ordinary Shares and 1 E Share. Ordinary Shareholders are entitled to all dividends paid by the Company and, on a winding up, provided the Company has satisfied all of its liabilities, the Shareholders are entitled to all of the surplus assets of the Company.

Ordinary Shareholders are entitled to attend and vote at all general meetings of the Company and, on a poll, to one vote for each Ordinary Share held.

Authority to Purchase Own Shares

The current authority of the Company to make market purchases of up to 14.99 percent of its issued share capital expires at the conclusion of the Company's first AGM on 21 May 2020. A special resolution will be proposed at the forthcoming AGM seeking renewal of such authority until the next AGM (or 31 October 2021, whichever is earlier). The price paid for the shares will not be less than the nominal value or more than the maximum amount permitted to be paid in accordance with the rules of the UK Listing Authority in force at the date of purchase. This power will be exercised only if, in the opinion of the Directors, a repurchase would be in the best interests of Shareholders as a whole. Any shares repurchased under this authority will either be cancelled or held in treasury at the discretion of the Board for future resale in appropriate market conditions.

The Directors believe that the renewal of the Company's authority to purchase shares, as detailed above, is in the best interests of Shareholders as a whole and therefore recommend Shareholders to vote in favour of this special resolution.

Major Interests in Shares

Significant shareholdings as at 31 December 2019 are detailed below.

In addition, the Company also provides the same information as at 5 February 2020, being the most current information available.

Companies Act 2016 Disclosures

In accordance with Schedule 7 of the Large and Medium Sized Companies and Groups (Accounts and Reports) Regulations 2008, the Directors disclose the following information:

·; the Company's capital structure is detailed in note 8 to the financial statements and all Shareholders have the same voting rights in respect of the share capital of the Company, except that the holders of E Shares have no right to speak or vote at any general meeting of the Company, unless there are no other shares of the Company in issue. There are no restrictions on voting rights that the Company is aware of, nor any agreement between holders of securities that result in restrictions on the transfer of securities or on voting rights;

·; there exist no securities carrying special rights with regard to the control of the Company;

·; the Company does not have an employees' share scheme;

·; the rules concerning the appointment and replacement of Directors are contained in the Company's Articles of Association and the Companies Act 2006;

·; there exist no agreements to which the Company is party that may affect its control following a takeover bid; and

·; there exist no agreements between the Company and its Directors providing for compensation for loss of office that may occur because of a takeover bid.

Investment Trust Status

The Directors intend at all times to conduct the affairs of the Company so as to enable it to qualify as an investment trust for the purposes of section 1158 of the Corporation Tax Act 2010, as amended and the Investment Trust (Approved Company) (Tax) Regulations 2011. In particular, the Company must not retain in respect of any accounting period an amount which is greater than 15 percent of its eligible investment income.

Diversity and Business Review

A business review is detailed in the Investment Manager's Report above and the Company's policy on diversity is detailed in the Corporate Governance Report below.

Directors' Indemnity

Directors' and Officers' liability insurance cover is in place in respect of the Directors. The Company's Articles of Association provide, subject to the provisions of UK legislation, an indemnity for Directors in respect of costs which they may incur relating to the defence of any proceedings brought against them arising out of their positions as Directors, in which they are acquitted or judgement is given in their favour by the Court.

Except for such indemnity provisions in the Company's Articles of Association and in the Directors' letters of appointment, there are no qualifying third party indemnity provisions in force.

Global Greenhouse Gas Emissions

As an investment trust, the Company's own direct environmental impact is minimal. The Company has no greenhouse gas emissions to report from its operations, nor does it have responsibility for any other emissions producing sources under the Companies Act 2006 (Strategic Report and Directors' Reports) Regulations 2013.

Risks and Risk Management

The Company is exposed to financial risks such as price risk, interest rate risk, credit risk and liquidity risk and the management and monitoring of these risks are detailed in note 15 to the financial statements.

Independent Auditor

The Directors will propose the reappointment of Ernst & Young LLP as the Company's Auditor and resolutions concerning this and the remuneration of the Company's Auditor will be proposed at the AGM.

At the time that this report was approved, so far as each of the Directors are aware:

·; there is no relevant audit information of which the Auditor is unaware; and

·; they have taken all the steps they ought to have taken to make themselves aware of any audit information and to establish that the Auditor is aware of that information

Annual Report

As disclosed in the Audit and Risk Committee Report below, the Audit and Risk Committee have given due consideration that the Annual Report, taken as a whole, is fair, balanced and understandable. Therefore the Board is of the opinion that the Annual Report provides the information necessary for Shareholders to assess the performance, strategy and business model of the Company.

The Board recommends that the Annual Report, the Report of the Directors and the Independent Auditor's Report for the period ended 31 December 2019 are received and adopted by the Shareholders and a resolution concerning this will be proposed at the AGM.

Dividend

The Board recommended an interim dividend of $2.6 million, equivalent to 2.57 cents per share with respect to the period ended 31 December 2019, as disclosed in note 14 to the financial statements.

Subsequent Events

Significant subsequent events have been disclosed in note 18 to the financial statements.

Strategic Report

A review of the business and future outlook, going concern statement and the principal risks and uncertainties of the Company have not been included in this report as they are disclosed in the Strategic Report above.

On behalf of the Board

Reuben Jeffery, III

Chairman

19 February 2020

Directors' Remuneration Report

This report has been prepared by the Directors in accordance with the requirements of the Companies Act 2006 and the Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008. A resolution to approve the Directors' Remuneration Report will be proposed at the Company's first AGM on 21 May 2020.

The Company's Auditor is required to give their opinion on the information provided on Directors' remuneration below and this is explained further in its report to Shareholders below. The remainder of this report is outside the scope of the external audit.

Annual Statement from the Chairman of the Board

The Board, which is profiled above, consists solely of non-executive Directors and is considered to be entirely independent. The Board considers at least annually the level of the Board's fees, in accordance with the AIC Code.

Remuneration Policy

As at the date of this report, the Board comprised 3 Directors, all of whom are non-executive. Due to the size of the Company and the Board, there is not a separate Remuneration Committee. Being wholly comprised of non-executive Directors, the whole Board considers these matters.

Each Director receives a fixed fee per annum based on their roles and responsibility within the Company and the time commitment required. It is not considered appropriate that Directors' remuneration should be performance related and none of the Directors are eligible for pension benefits, share options, long term incentive schemes or other benefits in respect of their services as non-executive Directors of the Company.

The maximum annual limit of aggregate fees payable to the Directors was set at the time of its incorporation on 11 March 2019 at £500,000 per annum. The Chairman will be entitled to an additional fee of £10,000 per annum and the Audit and Risk Committee Chair will be entitled to an additional fee of £5,000 per annum. The Board may grant special remuneration to any Director who performs any special or extra services to or at the request of the Company.

The Articles of Association provide that all of the Directors who are Directors at the date of the notice covering each AGM shall retire from office and each Director may offer themselves for re-election, in accordance with corporate governance best practice.

All of the Directors have been provided with letters of appointment, subject to re-election by Shareholders.

A Director's appointment may at any time be terminated by and at the discretion of either party upon written notice. A Director's appointment will automatically end without any right to compensation whatsoever if they are not re-elected by the Shareholders. A Director's appointment may also be terminated with immediate effect and without compensation in certain other circumstances. Being non-executive Directors, none of the Directors have a service contract with the Company.

A resolution to approve the Company's Remuneration Policy will be proposed at its first AGM on 21 May 2020. The terms and conditions of appointment of non-executive Directors are available for inspection from the Company's registered office.

Annual Report on Remuneration (Audited Information)

The table below shows all remuneration earned by each individual Director during the period:

Amounts paid to Directors as reimbursement of travel and other incidental expenses during the period were:

None of the Directors received any other remuneration or additional discretionary payments during the period from the Company.

Directors' Interests (audited information)

Directors who held office during the period and had interests in the Ordinary Shares of the Company as at 31 December 2019 are given in the table below. There were no changes to the interests of each Director as at the date of this report.

Relative Importance of Spend on Pay

The remuneration of the Directors with respect to the period totalled $115,093 in comparison to dividends paid or declared to Shareholders with respect to the period of $2.6 million.

Company Performance

The graph in the Annual Report compares the total return to Shareholders compared to the AIC Investment Trust Direct Lending sector index. The performance of the AIC Investment Trust Direct Lending sector index is shown as a market reference for investors.

On behalf of the Board

Reuben Jeffery, III

Chairman

19 February 2020

Directors' Responsibilities Statement

The Directors are responsible for preparing the Annual Report and the financial statements in accordance with applicable law and regulations.

Company law requires the Directors to prepare financial statements for each financial period. Under that law the Directors are required to prepare the Company financial statements, in accordance with IFRS as adopted by the EU. Under company law the Directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company and of the profit or loss for the Company for that period.

In preparing these financial statements, the Directors are required to:

·; select suitable accounting policies and then apply them consistently;

·; make judgements and accounting estimates that are reasonable and prudent;

·; state whether they have been prepared in accordance with IFRS as adopted by the EU, subject to any material departures disclosed and explained in the financial statements;

·; prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will continue in business; and

·; prepare a Report of the Directors, a Strategic Report and Directors' Remuneration Report which comply with the requirements of the Companies Act 2006.

The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company's transactions and disclose with reasonable accuracy at any time the financial position of the Company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. The Directors are responsible for ensuring that the Annual Report, taken as a whole, is fair, balanced and understandable and provides the information necessary for Shareholders to assess the Company's performance, business model and strategy.

Website Publication

The Directors are responsible for ensuring the Annual Report and the financial statements are made available on a website. Financial statements are published on the Company's website in accordance with legislation in the UK governing the preparation and dissemination of financial statements, which may vary from legislation in other jurisdictions. The maintenance and integrity of the Company's website is the responsibility of the Directors. The Directors' responsibilities also extend to the ongoing integrity of the financial statements contained therein.

Directors' Responsibilities Pursuant to DTR4

The Directors confirm that to the best of their knowledge:

·; the Company's financial statements have been prepared in accordance with IFRS as adopted by the EU and give a true and fair view of the assets, liabilities, financial position and profit and loss of the Company; and

·; the Annual Report includes a fair review of the development and performance of the business and the financial position of the Company, together with a description of the principal risks and uncertainties that they face.

On behalf of the Board

Reuben Jeffery, III

Chairman

19 February 2020

Corporate Governance Report

This Corporate Governance Report forms part of the Report of the Directors as further disclosed above. The Board operates under a framework for corporate governance which is appropriate for an investment company. The Company is not required to comply with the UK Listing Rules, however as a matter of good corporate governance, the Company shall voluntarily comply with the provisions of the Listing Rules applicable to closed-ended investment companies.

The Company became a member of the AIC with effect from 28 May 2019 and has therefore put in place arrangements to comply with the AIC Code and, in accordance with the AIC Code, complies with the UK Code. The AIC Code and the AIC Guide are available on the AIC's website, www.theaic.co.uk. The UK Code is available on the Financial Reporting Council's website, www.frc.org.uk.

The AIC Code, as explained by the AIC Guide, addresses all the principles set out in the UK Code, as well as setting out additional principles and recommendations on issues that are of specific relevance to investment companies such as the Company. The Board considers that reporting against the principles and recommendations of the AIC Code, by reference to the AIC Guide, provides better information to Shareholders.

The Company has complied with the recommendations of the AIC Code and the relevant provisions of the UK Code, except as set out below.

The UK Code includes provisions relating to:

·; the role of the chief executive;

·; executive directors' remuneration; and

·; the need for an internal audit function.

For the reasons set out in the AIC Guide, and as explained in the UK Code, the Board considers that the above provisions are not currently relevant to the position of the Company, being an externally managed investment company, which delegates most day-to-day functions to third parties.

The Company does not have a chief executive or any executive directors. The Company has not established a separate remuneration committee as the Company has no executive officers, nor has it established a Senior Independent Director due to the size of the Board and the Company. The Board is satisfied that any relevant issues that arise can be properly considered by the Board.

The Company has no employees or internal operations and has therefore not reported further in respect of these provisions. The need for an internal audit function is discussed in the Audit and Risk Committee Report.

The Board

The Company is led and controlled by a Board of Directors, which is collectively responsible for the long-term success of the Company. It does so by creating and preserving value, and has as its foremost principle acting in the interests of Shareholders.

The Company believes that the composition of the Board is a fundamental driver of its success as the Board must provide strong and effective leadership of the Company. The current Board was selected, as their biographies illustrate, to bring a breadth of knowledge, skills and business experience to the Company. The non-executive Directors provide independent challenge and review, bringing wide experience, specific expertise and a fresh objective perspective.

As at the date of this report, the Board consists of three non-executive Directors, all of whom are independent of the Company's Investment Manager. All Directors were appointed on 2 April 2019 and served throughout the period, and all will submit themselves for election at the first AGM of the Company. Having considered their effectiveness, demonstration of commitment to the role, attendance at meetings and contribution to the Board's deliberations, the Board approves the nomination for re-election of all of the Directors. At each subsequent AGM of the Company, each of the Directors at the date of the notice convening the AGM shall retire from office and may offer themselves for election or re-election by the Shareholders, in accordance with corporate governance best practice.

The Chairman of the Board is independent and is appointed in accordance with the Company's Articles of Incorporation. Mr. Jeffery is considered to be independent because he:

·; has no current or historical employment with the Investment Manager;

·; has no current directorships or partnerships in any other investment funds managed by the Investment Manager; and

·; is not an executive of a self-managed company or an ex-employee who has left the executive team of a self-managed company within the last five years

The Board meets at least four times a year for regular, scheduled meetings and should the nature of the activity of the Company require it, additional meetings may be held, some at short notice. At each meeting the Board follows a formal agenda that covers the business to be discussed. The primary focus at Board meetings is a review of investment performance and associated matters such as asset allocation, share price discount/premium management, investor relations, peer group information, gearing, industry issues and principal risks and uncertainties in particular those identified in the Strategic Report above.

The Board may request to be supplied in a timely manner with information by the Investment Manager, Administrator, Company Secretary and other advisers in a form and of a quality to enable it to discharge its duties.

The Company has adopted a share dealing code for the Board and will seek to ensure compliance by the Board and relevant personnel of the Investment Manager and other third party service providers with the terms of the share dealing code.

Diversity Policy

The Board monitors developments in corporate governance to ensure the Board remains aligned with best practice especially with respect to the increased focus on diversity. The Board acknowledges the importance of diversity, including gender, for the effective functioning of the Board and commits to supporting diversity in the boardroom. It is the Board's ongoing aspiration to have a well diversified representation. The Board also values diversity of business skills and experience because Directors with diverse skills sets, capabilities and experience gained from different geographical backgrounds enhance the Board by bringing a wide range of perspectives to the Company.

As at the date of this report, the Board comprised 2 men and 1 woman, all non-executive Directors who are considered to be independent of the Investment Manager and free from any business or other relationship that could materially interfere with the exercise of their independent judgement.

The Investment Manager has a diverse employee base and continues to dedicate recruiting resources to increasing diversity across all positions and levels.

Board Tenure and Re-election

As the Company was incorporated on 11 March 2019, no issues have arisen to be considered by the Board with respect to long tenure. In accordance with the AIC Code, in the event that any Director, including the Chairman, shall have been in office (or on re-election would at the end of that term of office) for more than nine years the Company will consider further whether there is a risk that such a Director might reasonably be deemed to have lost independence through such long service. The Board will consider its composition and succession planning on an ongoing basis. All Directors will stand for election at the first AGM of the Company and will stand for annual re-election at each subsequent AGM. In accordance with the AIC Code, the Board recognises that Directors serving nine years or more may appear to have their independence impaired. However, the Board may nonetheless consider Directors to remain independent and will provide a clear explanation within future Annual Report and Financial Statements as to its reasoning.

A Director who retires at an AGM may, if willing to continue to act, be elected or re-elected at that meeting. If, at a general meeting at which a Director retires, the Company neither re-elects that Director nor appoints another person to the Board in the place of that Director, the retiring Director shall, if willing to act, be deemed to have been re-elected unless at the general meeting it is resolved not to fill the vacancy or unless a resolution for the re-election of the Director is put to the meeting and not passed. Directors are appointed under letters of appointment.

Duties and Responsibilities

The Board has overall responsibility for the Company's activities, including reviewing its investment

activity, performance, business conduct and policy. The Directors also review and supervise the Company's delegates and service providers, including the Investment Manager.

The Directors may delegate certain functions to other parties. In particular, the Directors have delegated responsibility for management of the Company's portfolio of investments to the Investment Manager.

The Board retains direct responsibility for certain matters, including (but not limited to):

·; approving the Company's long term objective and any decisions of a strategic nature including any change in investment objective, policy and restrictions, including those which may need to be submitted to Shareholders for approval;

·; reviewing the performance of the Company in light of the Company's strategy objectives and budgets ensuring that any necessary corrective action is taken;

·; the appointment, overall supervision and removal of key service providers and any material amendments to the agreements or contractual arrangements with any key delegates or service providers;

·; approving quarterly dividends and the Company's dividend policy;

·; approving any transactions with ''related parties'' for the purposes of the Company's voluntary compliance with the applicable sections of the UK Listing Rules;

·; the review of the Company's valuation policy;

·; the review of the Company's corporate governance arrangements; and

·; approving any actual or potential conflicts of interest.

The Directors have access to the advice and services of the Administrator, who is responsible to the Board for ensuring that Board procedures are followed and that it complies with applicable law and regulations of the LSE. Where necessary, in carrying out their duties, the Directors may seek independent professional advice and services at the expense of the Company. The Company maintains Directors' and officers' liability insurance in respect of legal action against its Directors on an ongoing basis.

The Board's responsibilities for the Annual Report are set out in the Directors' Responsibility Statement. The Board has responsibility for ensuring that the Company keeps proper accounting records which disclose with reasonable accuracy at any time the financial position of the Company and which enable it to ensure that the financial statements comply with applicable regulation. It is the Board's responsibility to present a fair, balanced and understandable Annual Report, which provides the information necessary for Shareholders to assess the performance, strategy and business model of the Company. This responsibility extends to the half-yearly financial reports, quarterly portfolio valuations and other price-sensitive public reports.

Directors' attendance at Board and Committee Meetings

One of the key criteria the Company uses when selecting non-executive Directors is their confirmation prior to their appointment that they will be able to allocate sufficient time to the Company to discharge their responsibilities in a timely and effective manner.

The Board formally met 5 times during the period.

Directors are encouraged when they are unable to attend a meeting to give the Chairman their views and comments on matters to be discussed, in advance. In addition to their meeting commitments, the non-executive Directors also liaise with the Investment Manager whenever required and there is regular contact outside the Board meeting schedule.

Attendance is further set out below:

Column A: indicated the number of meetings held during the period.

Column B: indicates the number of meetings attended by the Director during the period.

A quorum is comprised of any two or more members of the Board from time to time, to perform administrative and other routine functions on behalf of the Board, subject to such limitations as the Board may expressly impose on this committee from time to time.

Committees of the Board

The Board believes that it and its committees have an appropriate composition and blend of skills, experience, independence and diversity of backgrounds to discharge their duties and responsibilities effectively. The Board is of the view that no one individual or small group dominates decision-making. The Board keeps its membership, and that of its committees, under review to ensure that an acceptable balance is maintained, and that the collective skills and experience of its members continue to be refreshed. It is satisfied that all Directors have sufficient time to devote to their roles and that undue reliance is not placed on any individual.

Each committee of the Board has written terms of reference, approved by the Board, summarising its objectives, remit and powers, which are available on the Company's website and reviewed on an annual basis. All committee members are provided with appropriate induction on joining their respective committees, as well as on-going access to training. Minutes of all meetings of the committees (save for the private sessions of committee members at the end of meetings) are made available to all Directors and feedback from each of the committees is provided to the Board by the respective committee Chairmen at the next Board meeting. The Chairman of each committee attends the AGM to answer any questions on their committee's activities.

The Board and its committees are supplied with regular, comprehensive and timely information in a form and of a quality that enables them to discharge their duties effectively. All Directors are able to make further enquiries of management whenever necessary, and have access to the services of the Company Secretary.

On 9 May 2019, the Board established an Audit and Risk Committee which held its first meeting on 14 August 2019. The Audit and Risk Committee is chaired by Ms. Davies and comprises all of the non-executive Directors. The Audit and Risk Committee, the Investment Manager, the Administrator and the external auditor, Ernst & Young LLP, have held discussions regarding the audit approach and identified risks. The external auditor attends Audit and Risk Committee meetings and a private meeting will be held routinely with the external auditor to afford them the opportunity of discussions without the presence of management. The Audit and Risk Committee activities are contained in the Report of the Audit and Risk Committee below.

On 9 May 2019, the Board established a Nomination Committee which meets at least once a year pursuant to its terms of reference. As the Company listed its shares on 28 May 2019, it held its first meeting on 19 February 2020. The Nomination Committee is chaired by Mr. Cumming-Bruce and comprises all of the non-executive Directors.

The Nomination Committee is convened for the purpose of considering the appointment of additional Directors as and when considered appropriate. The Nomination Committee recognises the continuing importance of planning for the future and ensuring that succession plans are in place. In considering appointments to the Board, the Nomination Committee will take into account the ongoing requirements of the Company and evaluate the balance of skills, experience, independence, and knowledge of each candidate. Therefore, appointments will be made on personal merit and against objective criteria with the aim of bringing new skills and different perspectives to the Board whilst taking into account the existing balance of knowledge, experience and diversity.

In the case of candidates for non-executive directorships, care will be taken to ascertain that they have sufficient time to fulfil their Board and, where relevant, committee responsibilities. The Board believes that the terms of reference of the Nomination Committee ensure that it operates in a rigorous and transparent manner. The Board believes that, as a whole, it comprises an appropriate balance of skills, experience and knowledge. The Board also believes that diversity of experience and approach, including gender diversity, amongst Board members is of great importance and it is the Company's policy to give careful consideration to issues of Board balance and diversity when making new appointments.

The Nominations Committee has reviewed the composition, structure and diversity of the Board, succession planning, the independence of the Directors and whether each of the Directors has sufficient time available to discharge their duties effectively. The Committee and the Board confirm that they believe that the Board has an appropriate mix of skills and backgrounds and was selected with that in mind, that a majority of Directors should be considered as Independent in accordance with the provisions of the AIC Code and that all Directors have the time available to discharge their duties effectively.

Accordingly, the Board recommends that Shareholders vote in favour of the election of all Directors at the first AGM of the Company. 

On 9 May 2019, the Board established a Management Engagement Committee which held its first meeting on 24 October 2019. The Management Engagement Committee is chaired by Mr. Jeffery and comprises all of the non-executive Directors. The Management Engagement Committee meets at least once a year pursuant to its terms of reference.

The Management Engagement Committee provides a formal mechanism for the review of the performance of the Investment Manager and the Company's other advisors and service providers. It carries out this review through consideration of a number of objective and subjective criteria and through a review of the terms and conditions of the advisors' appointments with the aim of evaluating performance, identifying any weaknesses and ensuring value for money for the Shareholders. On 24 October 2019, the Management Engagement Committee verbally reviewed the performance of the Investment Manager and other service providers and confirmed that performance had been satisfactory to date. A formal review of all key service providers will be conducted in 2020, as this will be the Company's first full year of operation.

The AIC Code recommends that companies appoint a Remuneration Committee, however the Board has not deemed this necessary, as being wholly comprised of non-executive Directors, the whole Board considers these matters.

Board Performance and Evaluation

In accordance with Provision 26 of the AIC Code, the Board is required to undertake a formal and rigorous evaluation of its performance on an annual basis. Such an evaluation of the performance of the Board as whole, the Audit and Risk Committee, the Nomination Committee, the Management Engagement Committee, individual Directors and the Chairman will be carried out under the mandate of the Nomination Committee. The Board believes that the current mix of skills, experience, knowledge and age of the Directors is appropriate to the requirements of the Company.

Due to the recent commencement of operations of the Company, no formal Board evaluation has been carried out as at the date of this report. A formal Board evaluation will be completed during 2020 and the results of this review will be reported in the next Annual Report. This will enable the necessary rigour of evaluation, and consideration thereafter, as anticipated by the UK Code.

New Directors receive an induction on joining the Board and regularly meet with the senior management employed by the Investment Manager both formally and informally to ensure that the Board remains regularly updated on all issues. All members of the Board are members of professional bodies and serve on other Boards, which ensures they are kept abreast of the latest technical developments in their areas of expertise.

The Board arranges for presentations from the Investment Manager, the Company's brokers and other advisors on matters relevant to the Company's business. The Board will assess the training needs of Directors on an annual basis.

Internal Control and Financial Reporting

The Directors acknowledge that they are responsible for establishing and maintaining the Company's system of internal control and reviewing its effectiveness. Internal control systems are designed to manage rather than eliminate the failure to achieve business objectives and can only provide reasonable but not absolute assurance against material misstatements or loss. However, the Board's objective is to ensure that the Company has appropriate systems in place for the identification and management of risks. The Directors carry out a robust assessment of the principal risks facing the Company, including those that would threaten its business model, future performance, solvency or liquidity. As further explained in the Audit and Risk Committee Report, the risks of the Company are outlined in a risk matrix which was reviewed and updated during the period. The Board continually reviews its policy setting and updates the risk matrix at least quarterly to ensure that procedures are in place with the intention of identifying, mitigating and minimising the impact of risks should they crystallise.

The key procedures which have been established to provide internal control are that:

·; the Board has delegated the day-to-day operations of the Company to the Administrator and Investment Manager; however, it retains accountability for all functions it delegates;

·; the Board clearly defines the duties and responsibilities of the Company's agents and advisors and appointments are made by the Board after due and careful consideration. The Board monitors the ongoing performance of such agents and advisors and will continue to do so through the Management Engagement Committee;

·; the Board monitors the actions of the Investment Manager at regular Board meetings and is given frequent updates on developments arising from the operations and strategic direction of the underlying investee companies;

·; the Administrator provides administration and company secretarial services to the Company.The Administrator maintains a system of internal control on which they report to the Board; and

·; the Board has reviewed the need for an internal audit function and has decided that the systems and procedures employed by the Administrator and Investment Manager, including their own internal controls and procedures, provide sufficient assurance that an appropriate level of risk management and internal control, which safeguards Shareholders' investments and the Company's assets, is maintained. An internal audit function specific to the Company is therefore considered unnecessary.

Internal controls over financial reporting are designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external reporting purposes. The Administrator and Investment Manager both operate risk controlled frameworks on a continual ongoing basis within a regulated environment. The Administrator formally reports to the Board quarterly through a compliance report and holds the International Standard on Assurance Engagements (ISAE) 3402 Type 2 certification. This entails an independent rigorous examination and testing of their controls and processes. The Investment Manager formally reports to the Board quarterly including updates within Riverstone and also engages with the Board on an ad-hoc basis as required. No weaknesses or failings within the Administrator or Investment Manager have been identified.

The systems of control referred to above are designed to ensure effectiveness and efficient operation, internal control and compliance with laws and regulations. In establishing the systems of internal control, regard is paid to the materiality of relevant risks, the likelihood of costs being incurred and costs of control. It follows therefore that the systems of internal control can only provide reasonable but not absolute assurance against the risk of material misstatement or loss. This process has been in place for the period under review and up to the date of approval of this Annual Report and financial statements. It is reviewed by the Board and is in accordance with the FRC's internal control publication: Guidance on Risk Management, Internal Control and Related Financial and Business Reporting.

Investment Management Agreement

The Investment Manager has been appointed as the sole investment manager of the Company and the SPVs. Pursuant to the Investment Management Agreement, the Investment Manager has responsibility for and discretion over investing and managing the Company's and the SPVs' direct and indirect assets, subject to and in accordance with the Company's investment policy. The Investment Manager is entitled to delegate all or part of its functions under the Investment Management Agreement to one or more of its affiliates. A summary of the fees paid to the Investment Manager are given in note 12 to the financial statements.

The Investment Manager's appointment is terminable by the Investment Manager or the Company on not less than 12 months' notice, such notice not to expire prior to the third anniversary of Admission. The Investment Management Agreement may be terminated with immediate effect and without compensation, by either the Investment Manager or the Company if the other party has gone into liquidation, administration or receivership or has committed a material breach of the Investment Management Agreement.

The Company has delegated the provision of all services to external service providers whose work is overseen by the Management Engagement Committee at its regular scheduled meetings. Each year, a detailed review of performance pursuant to their terms of engagement will be undertaken by the Management Engagement Committee.

The Board as a whole reviewed the Company's compliance with the UK Code, the Listing Rules, the Disclosure Guidance and Transparency Rules and the AIC Code. In accordance with Listing Rule 15.6.2(2)R and having formally appraised the performance and resources of the Investment Manager, in the opinion of the Directors the continuing appointment of the Investment Manager on the terms agreed is in the interests of the Shareholders as a whole. The Board is pleased with the performance of the investment manager, based on the selection of high quality E&P and midstream investments.

Our Culture

The Board discussed the Company's culture over the course of the period. It was agreed that the Company's culture is built around that of the Investment Manager, with a focus on long lasting relationships with a diverse investor base; sustainable investment excellence; and a world class team demonstrating extensive industry knowledge. The Board will continue to monitor the Company's culture on an annual basis through continued engagement with shareholders and management.

Relations with Shareholders

The Board welcomes Shareholders' views and places great importance on communication with its Shareholders. The Company's AGM provides a forum for Shareholders to meet and discuss issues with the Directors of the Company. The Chairman and other Directors are also available to meet with Shareholders at the AGM to hear their views and discuss any issues or concerns, including in relation to Board composition, governance and strategy, or at other times, if required.

The Company reports formally to Shareholders in a number of ways; regulatory news releases through the London Stock Exchange's Regulatory News Service, announcements are issued in response to events or routine reporting obligations. Also, an Interim Report will be published each year outlining performance to 30 June and the Annual Report will be published each year for the year ended 31 December, both of which will be made available on the Company's website. In addition, the Company's website contains comprehensive information, including company notifications, share information, financial reports, investment objectives and policy, investor contacts and information on the Board and corporate governance. Shareholders and other interested parties can subscribe to email news updates by registering online on the website.

The Directors and Investment Manager receive informal feedback from analysts and investors, which is presented to the Board by the Company's Broker. The Company Secretary also receives informal feedback via queries submitted through the Company's website and these are addressed by the Board, the Investment Manager or the Company Secretary, where applicable.

Other Stakeholders

The wider stakeholders of the Company comprise its service providers, investee companies and suppliers and the Board recognises and values these stakeholders.

As an investment trust with no employees the Company's relationship with its service providers, including the Investment Manager, is of particular importance. Service providers have been selected and engaged based on due diligence and references including consideration of their internal controls and expertise. The Company has established a Management Engagement Committee, who will review the performance of each service provider annually and provide feedback as appropriate, to maintain good working relationships.

The Company's investment helps to ensure that the investee companies have the resources to perform well, which helps to drive the local economies in which these companies are located. Responsible investing principles have been applied to each of the investments made, which ensures that appropriate due diligence has been conducted and that the terms of the investments are clearly set out and agreed with investee companies in advance.

The Board recognises that relationships with suppliers are enhanced by prompt payment and the Company's Administrator, in conjunction with the Investment Manager, ensures all payments are processed within the contractual terms agreed with the individual suppliers.

Whistleblowing

The Board has considered arrangements by which staff of the Investment Manager or Administrator may, in confidence, raise concerns within their respective organisations about possible improprieties in matters of financial reporting or other matters. It has concluded that adequate arrangements are in place for the proportionate and independent investigation of such matters and, where necessary, for appropriate follow-up action to be taken within their organisation.

By order of the Board

Reuben Jeffery, III

Chairman

19 February 2020

Audit and Risk Committee Report

The Audit and Risk Committee, chaired by Ms. Emma Davies, operates within clearly defined terms of reference, which are available from the Company's website, and include all matters indicated by Disclosure Guidance and Transparency Rule 7.1, the AIC Code and the UK Code. Its other members are Mr. Reuben Jeffery, III and Mr. Edward Cumming-Bruce. Members of the Audit and Risk Committee must be independent of the Company's external auditor and Investment Manager. Although Mr. Reuben Jeffery, III is Chairman of the Company, the Board believes that it is appropriate for him to be a member of the Audit and Risk Committee, given the size of the Company's Board. The Audit and Risk Committee will meet no less than three times in a year, and at such other times as the Audit and Risk Committee Chair shall require, and will meet the external auditor at least once a year.

The Committee members have considerable financial and business experience and the Board has determined that the membership as a whole has sufficient recent and relevant sector and financial experience to discharge its responsibilities and that at least one member has competence in accounting or auditing.

Responsibilities

The main duties of the Audit and Risk Committee are:

·; to monitor the integrity of the Company's financial statements and regulatory announcements relating to its financial performance and review significant financial reporting judgements;

·; to report to the Board on the appropriateness of the Company's accounting policies and practices;

·; to consider the ongoing assessment of the Company as a going concern and assessment of longer term viability;

·; to review the valuations of the Company's investments prepared by the Investment Manager, and provide a recommendation to the Board on the valuation of the Company's investments;

·; to oversee the relationship with the external auditor, including agreeing their remuneration and terms of engagement, review their reporting, monitoring their independence, objectivity and effectiveness, ensuring that any non-audit services are appropriately considered, and making recommendations to the Board on their appointment, reappointment or removal, for it to put to the Shareholders in general meeting;

·; to monitor and consider annually whether there is a need for the Company to have its own internal audit function;

·; to keep under review the effectiveness of the Company's internal controls, including financial controls and risk management systems;

·; to review and consider the UK Code, the AIC Code, and the AIC Guidance on Audit Committees; and

·; to report to the Board on how it has discharged its responsibilities.

The Audit and Risk Committee is aware that certain sections of the Annual Report are not subject to formal statutory audit, including the Chairman's Statement, the Investment Manager's Report and certain sections of the Directors' Remuneration Report. Financial information in these sections is reviewed by the Audit and Risk Committee.

The Audit and Risk Committee is required to report its findings to the Board, identifying any matters on which it considers that action or improvement is needed, and make recommendations on the steps to be taken.

The external auditor was invited to attend the Audit and Risk Committee meetings at which the Annual Report and Interim Financial Report were considered. They will have the opportunity to meet with the Committee without representatives of the Investment Manager or Administrator being present at least once per year.

Financial Reporting

The primary role of the Audit and Risk Committee in relation to financial reporting is to review with the Administrator, the Investment Manager and the external auditor and report to the Board on the appropriateness of the Annual Report and financial statements and Interim Financial Report, concentrating on, amongst other matters:

·; the quality and acceptability of accounting policies and practices;

·; the clarity of the disclosures and compliance with financial reporting standards and relevant financial and governance reporting requirements;

·; material areas in which significant judgements have been applied or where there has been discussion with the external auditor including going concern and viability statement;

·; whether the Annual Report and financial statements, taken as a whole, is fair, balanced and understandable and provides the information necessary for Shareholders to assess the Company's performance, business model and strategy; and

·; any correspondence from regulators in relation to financial reporting.

To aid its review, the Audit and Risk Committee considers reports from the Administrator and the Investment Manager and also reports from the external auditor on the outcomes of their half-year review and annual audit.

Meetings

During the period ended 31 December 2019, the Audit and Risk Committee met twice formally and there was ongoing liaison and discussion between the external auditor and the Audit and Risk Committee Chair with regards to the audit approach and the identified risks.

The matters discussed at those meetings include:

• review of the terms of reference of the Audit and Risk Committee for approval by the Board;

• review of the accounting policies and format of the financial statements;

• review and approval of the audit plan of the external auditor;

• discussion and approval of the fee for the external audit;

• detailed review of the valuations of the Company's investment portfolio and recommendation for approval by the Board;

• detailed review of the Interim Report and quarterly portfolio valuations, and recommendation for approval by the Board;

• assessment of the independence of the external auditor;

• assessment of the effectiveness of the external audit process as described below; and

• review of the Company's key risks and internal controls.

After the period ended 31 December 2019, the Audit and Risk Committee met on 19 February 2020 to review the results of the audit and to consider and approve the Annual Report.

Significant Areas of Judgement Considered by the Audit and Risk Committee

The Audit and Risk Committee has determined that a key risk of misstatement of the Company's financial statements relates to the valuation of its investments at fair value through profit or loss, in the context of the judgements necessary to evaluate market values of the underlying investments. There is also an inherent risk of management override as the Investment Manager's Profit Share is calculated based on revenue recognition and the NAV as disclosed in note 12 to the financial statements. The Investment Manager is responsible for calculating the NAV with the assistance of the Administrator, prior to approval by the Board.

In view of the Company's investments and the nature of the assets, no adjustment to the NAV of the investments has been made, as this is deemed equivalent to fair value.

The Audit and Risk Committee reviews, considers and, if thought appropriate, recommends for the purposes of the Company's financial statements, valuations prepared by the Investment Manager in respect of the investments.

As outlined in note 4 to the financial statements, the total carrying value of the investments at fair value through profit or loss at 31 December 2019 was $91.5 million.

On a quarterly basis, the Investment Manager provides a detailed analysis of the NAV highlighting any movements and assumption changes from the previous quarter's NAV. This analysis and the rationale for any changes made is considered and challenged by the Audit and Risk Committee and subsequently approved by the Board. The Audit and Risk Committee has satisfied itself that the key estimates and assumptions used in the valuation model are appropriate and that the investments have been fairly valued.

The valuation for each individual investment held by the SPVs is determined by reference to common industry valuation techniques, including comparable public market valuation, comparable merger and acquisition transaction valuation, and discounted cash flow valuation, as detailed in notes 2 and 4 to the financial statements.

The valuation process and methodology was discussed with the Investment Manager and with the external auditor at the Audit and Risk Committee meetings held on 24 October 2019 and 19 February 2020. Due to the illiquid and subjective nature of the Company's investments, the Investment Manager uses an independent third party valuation provider to prepare quarterly valuations and has provided a detailed valuation report to the Company at each quarter.

The external auditor has explained the results of their audit work on valuations in the Independent Auditor's Report below. There were no adjustments proposed that were material in the context of the Annual Report and financial statements as a whole.

Risk Management

The Board is accountable for carrying out a robust assessment of the principal risks facing the Company, including those threatening its business model, future performance, solvency and liquidity. On behalf of the Board, the Audit and Risk Committee reviews the effectiveness of the Company's risk management processes. The Company's risk assessment process and the way in which significant business risks are managed is a key area of focus for the Audit and Risk Committee. The work of the Audit and Risk Committee was driven primarily by the Company's assessment of its principal risks and uncertainties as set out in the Strategic Report. The Audit and Risk Committee receives reports from the Investment Manager and Administrator on the Company's risk evaluation process and reviews changes to significant risks identified.

Internal Audit

The Audit and Risk Committee shall consider at least once a year whether or not there is a need for an internal audit function. Currently, the Audit and Risk Committee does not consider there to be a need for an internal audit function, given that there are no employees in the Company and all outsourced functions are with parties who have their own internal controls and procedures.

External Audit

Ernst & Young LLP has been the Company's external auditor since the Company's incorporation. This is the first period of audit.

The external auditor is required to rotate the audit partner every five years. There are no contractual obligations restricting the choice of external auditor and the Company will put the audit services contract out to tender at least every ten years. Under Companies Law, the reappointment of the external auditor is subject to Shareholder approval at the AGM. The Audit and Risk Committee will continue to monitor the performance of the external auditor on an annual basis and will consider their independence and objectivity, taking account of appropriate guidelines. In addition, the Committee Chair will continue to maintain regular contact with the lead audit partner outside the formal Committee meeting schedule, not only to discuss formal agenda items for upcoming meetings, but also to review any other significant matters.

The Audit and Risk Committee reviews the scope and results of the audit, its cost effectiveness and the independence and objectivity of the external auditor, with particular regard to the level of any non-audit fees. Notwithstanding such services, the Audit and Risk Committee considers Ernst & Young LLP to be independent of the Company and that the provision of such non-audit services is not a threat to the objectivity and independence of the conduct of the audit.

To further safeguard the objectivity and independence of the external auditor from becoming compromised, the Audit and Risk Committee are aware of the EU Directive that imposes a cap on fees to be charged by a company's external auditor for non-audit services at 70 percent of the average statutory audit fees for the previous 3 years. This precludes Ernst & Young LLP from providing certain services such as valuation work or the provision of accounting services and also sets a presumption that Ernst & Young LLP should only be engaged for non-audit services where they are best placed to provide those services, for example the interim review and reporting accountant services. Note 10 details services provided by Ernst & Young LLP during the period.

To fulfil its responsibility regarding the independence of the external auditor, the Audit and Risk Committee considers:

·; discussions with or reports from the external auditor describing its arrangements to identify, report and manage any conflicts of interest; and

·; the extent of non-audit services provided by the external auditor.

To assess the effectiveness of the external auditor, the committee reviews:

·; the external auditor's fulfilment of the agreed audit plan and variations from it;

·; discussions or reports highlighting the major issues that arose during the course of the audit; and

·; feedback from other service providers evaluating the performance of the audit team.

The Audit and Risk Committee is satisfied with Ernst & Young LLP's effectiveness and independence as external auditor having considered the degree of diligence and professional scepticism demonstrated by them. Having carried out the review described above, and having satisfied itself that the external auditor remains independent and effective, the Audit and Risk Committee has recommended to the Board that Ernst & Young LLP be reappointed as external auditor for the year ending 31 December 2020.

The Audit and Risk Committee has provided the Board with its recommendation to the Shareholders on the re-appointment of Ernst & Young LLP as external auditor for the year ending 31 December 2020. Accordingly, a resolution proposing the reappointment of Ernst & Young LLP as our external auditor will be put to Shareholders at the AGM.

On behalf of the Audit and Risk Committee

Emma Davies

Audit and Risk Committee Chair

19 February 2020

Independent Auditor's Report

Independent Auditor's Report to the Members of Riverstone Credit Opportunities Income PLC

Opinion

We have audited the financial statements of Riverstone Credit Opportunities Income PLC (the "Company") for the period ended 31 December 2019 which comprise the Statement of Financial Position, the Statement of Comprehensive Income, the Statement of Changes in Equity, Statement of Cash Flows and the related notes 1 to 18, 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 Company's affairs as at 31 December 2019 and of its profit for the period then ended;

·; have been properly prepared in accordance with IFRSs as adopted by the European Union; 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 this 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 as applied to public interest entities, 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 principal risks, going concern and viability statement

The Directors have voluntarily complied with the UK Corporate Governance Code (the "Code") and Listing Rule 9.8.6(R)(3)(a) of the FCA and provided a statement in relation to going concern, required for companies with a premium listing on the London Stock Exchange.

As a result, we have nothing to report in respect of the following information in the Annual Report, in relation to which the ISAs (UK) require us to report to you whether we have anything material to add or draw attention to:

·; the disclosures in the Annual Report set out above that describe the principal risks and explain how they are being managed or mitigated;

·; the Directors' confirmation set out above in the Annual Report that they have carried out a robust assessment of the principal risks facing the Company, including those that would threaten its business model, future performance, solvency or liquidity;

·; the Directors' statement set out above in the financial statements about whether they considered it appropriate to adopt the going concern basis of accounting in preparing them, and their identification of any material uncertainties to the Company's ability to continue to do so over a period of at least twelve months from the date of approval of the financial statements;

·; whether the Directors' statement in relation to going concern required under the Listing Rules in accordance with Listing Rule 9.8.6R(3) is materially inconsistent with our knowledge obtained in the audit; or

·; the Directors' explanation set out above in the Annual Report as to how they have assessed the prospects of the Company, over what period they have done so and why they consider that period to be appropriate, and their statement as to whether they have a reasonable expectation that the Company will be able to continue in operation and meet its liabilities as they fall due over the period of their assessment, including any related disclosures drawing attention to any necessary qualifications or assumptions.

Overview of our audit approach

Key audit matters

Key audit matters are those matters that, in our professional judgment, 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 our opinion thereon, and we do not provide a separate opinion on these matters.

An overview of the scope of our audit

Our assessment of audit risk, our evaluation of materiality and our allocation of performance materiality determine our audit scope for the Company. This enables us to form an opinion on the financial statements. We take into account: size, risk profile, the organisation of the Company and effectiveness of controls, including controls and changes in the business environment when assessing the level of work to be performed.

Our application of materiality

We apply the concept of materiality in planning and performing the audit, in evaluating the effect of identified misstatements on the audit and in forming our audit opinion.

The magnitude of an omission or misstatement that, individually or in the aggregate, could reasonably be expected to influence the economic decisions of the users of the financial statements. Materiality provides a basis for determining the nature and extent of our audit procedures.

We determined materiality for the Company to be $1,014k, which is 1% of net assets. We have derived our materiality calculation based on net assets as we consider it is the most relevant measure to the stakeholders of the Company.

The application of materiality at the individual account or balance level. It is set at an amount to reduce to an appropriately low level the probability that the aggregate of uncorrected and undetected misstatements exceeds materiality.

On the basis of our risk assessments, together with our assessment of the Company's overall control environment, our judgment was that performance materiality was 50% of our planning materiality, namely $507k. We have set performance materiality at this percentage due to this being a first-year audit.

An amount below which identified misstatements are considered as being clearly trivial.

We agreed with the Audit and Risk Committee that we would report to them all uncorrected audit differences in excess of $50.7k, which is set at 5% of planning materiality, as well as differences below that threshold that, in our view, warranted reporting on qualitative grounds.

We evaluate any uncorrected misstatements against both the quantitative measures of materiality discussed above and in light of other relevant qualitative considerations in forming our opinion.

Other information

The other information comprises the information included in the annual report, other than the financial statements and our auditor's report thereon. The Directors are responsible for the other information.

Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in this 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 the other information, we are required to report that fact.

We have nothing to report in this regard.

The Directors have voluntarily complied with the UK Corporate Governance Code (the "Code") and prepares a Corporate Governance Statement in accordance with the Disclosure Guidance and Transparency Rules of the Financial Conduct Authority ("FCA").

The Directors have requested that we review the parts of the Corporate Governance Statement relating to the Company's compliance with the UK Corporate Governance Code containing provisions specified for review by the auditor in accordance with Listing Rule 9.8.10R(2) as if the Company were a premium listed company.

In this context, we also have nothing to report in regard to our responsibility to specifically address the following items in the other information and to report as uncorrected material misstatements of the other information where we conclude that those items meet the following conditions:

·; Fair, balanced and understandable set out above - the statement given by the Directors that they consider the Annual Report and financial statements taken as a whole is fair, balanced and understandable and provides the information necessary for shareholders to assess the Company's performance, business model and strategy, is materially inconsistent with our knowledge obtained in the audit; or

·; Audit and Risk Committee reporting set out above - the section describing the work of the Audit and Risk Committee does not appropriately address matters communicated by us to the Audit and Risk Committee; or

·; Directors' statement of compliance with the UK Corporate Governance Code set out above - the parts of the Directors' statement required under the Listing Rules relating to the Company's compliance with the UK Corporate Governance Code containing provisions specified for review by the auditor in accordance with Listing Rule 9.8.10R(2) do not properly disclose a departure from a relevant provision of the UK Corporate Governance Code.

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 the audit:

·; the information given in the Strategic Report and the Report of the Directors for the financial period for which the financial statements are prepared is consistent with the financial statements; and

·; the Strategic Report and the Report of the Directors have been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the Company and its environment obtained in the course of the audit, we have not identified material misstatements in the Strategic Report or Report of the Directors.

We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:

·; adequate accounting records have not been kept, 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 Directors

As explained more fully in the Directors' Responsibilities Statement set out above, 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.

Explanation as to what extent the audit was considered capable of detecting irregularities, including fraud

The objectives of our audit, in respect to fraud, are; to identify and assess the risks of material misstatement of the financial statements due to fraud; to obtain sufficient appropriate audit evidence regarding the assessed risks of material misstatement due to fraud, through designing and implementing appropriate responses; and to respond appropriately to fraud or suspected fraud identified during the audit. However, the primary responsibility for the prevention and detection of fraud rests with both those charged with governance of the Company and management.

Our approach was as follows:

·; We obtained an understanding of the legal and regulatory frameworks that are applicable to the Company and determined that the most significant frameworks which are directly relevant to specific assertions in the financial statements are those that relate to the reporting framework (IFRS as adopted by the EU, the Companies Act 2006 and UK Corporate Governance Code) and relevant tax compliance regulation, Section 1158 of the Corporation Tax Act 2010.

·; We understood how the Company is complying with those frameworks by making enquiries of the Investment Manager, Company Secretary, and also the Directors including the Chair of the Audit and Risk Committee. We corroborated our understanding through our review of board minutes, papers provided to the Audit and Risk Committee and correspondence received from regulatory bodies.

·; We assessed the susceptibility of the Company's financial statements to material misstatement, including how fraud might occur by considering the key risks impacting the financial statements. We identified a fraud and management override risk in relation to the incorrect calculation and allocation of the Profit Share payable to the Investment Manager. Our audit procedures stated above in the 'Key audit matters section' of this Auditor's report were performed to address this identified fraud risk.

·; Based on this understanding we designed our audit procedures to identify non-compliance with such laws and regulations. Our procedures involved journal entry testing, with a focus on manual journals and journals indicating large or unusual transactions based on our understanding of the business and focused testing, as referred to in the key audit matters section above.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

Other matters we are required to address

·; We were appointed by the Board on 2 April 2019 to audit the financial statements for the period ending 31 December 2019 and subsequent financial periods. We signed an engagement letter on 24 October 2019.

The period of total uninterrupted engagement including previous renewals and reappointments is one year, covering the period ending 31 December 2019.

·; The non-audit services prohibited by the FRC's Ethical Standard were not provided to the Company and we remain independent of the Company in conducting the audit.

·; The audit opinion is consistent with the additional report to the Audit and Risk 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.

Mike Gaylor (Senior Statutory Auditor)

for and on behalf of Ernst & Young LLP, Statutory Auditor

London

19 February 2020

Statement of Financial Position

As at 31 December 2019

The financial statements of the Company were approved and authorised for issue by the Board of Directors on 19 February 2020 and signed on its behalf by:

Reuben Jeffery, III Emma Davies

Chairman Director

The accompanying notes below form an integral part of these financial statements.

Statement of Comprehensive Income

For the period ended 31 December 2019

The accompanying notes below form an integral part of these financial statements.

Statement of Changes in Equity

For the period ended 31 December 2019

The share premium account was cancelled by a court order dated 16 July 2019. The amount standing to the credit of the share premium account of the Company, less any issue expenses set off against the share premium account, was cancelled and credited to distributable reserves. This amount shall be capable of being applied in any manner in which the Company's profits available for distribution, as determined in accordance with the Companies Act 2006, are able to be applied.

After taking account of cumulative unrealised gains of $777k and other distributable reserves, the total reserves distributable by way of a dividend as at 31 December 2019 were $99,574k.

The accompanying notes below form an integral part of these financial statements.

Statement of Cash Flows

For the period ended 31 December 2019

The accompanying notes below form an integral part of these financial statements.

Notes to the Financial Statements

For the period ended 31 December 2019

1. General Information

The Company was incorporated and registered in England and Wales on 11 March 2019 with registered number 11874946 as a public company limited by shares under the Companies Act 2006

(the ''Act''). The principal legislation under which the Company operates is the Act. The Directors intend, at all times, to conduct the affairs of the Company so as to enable it to qualify as an investment trust for the purposes of section 1158 of the Corporation Tax Act 2010, as amended.

2. Significant accounting policies

Basis of preparation

The financial statements have been prepared in accordance with IFRS and with the Companies Act 2006. Where presentational guidance set out in the AIC SORP is consistent with the requirements of IFRS, the Directors have sought to prepare the financial statements on a basis compliant with the recommendations of the AIC SORP. In particular, supplementary information which analyses the Statement of Comprehensive Income between items of a revenue and capital nature has been presented alongside the total Statement of Comprehensive Income.

The annual financial statements have been prepared on the historical cost basis, as modified for the measurement of certain financial instruments at fair value through profit or loss. The principal accounting policies are set out below.

Foreign currencies

The functional currency of the Company is US Dollar reflecting the primary economic environment in which the Company operates, that being the E&P and midstream energy sectors, where most transactions are expected to take place in US Dollar. Additionally, the Ordinary Shares of the Company are listed in US Dollars.

The Company has chosen US Dollar as its presentation currency for financial reporting purposes.

Transactions during the period, including income and expenses, are translated into US Dollar at the rate of exchange prevailing on the date of the transaction. Monetary assets and liabilities denominated in currencies other than US Dollar are retranslated at the functional currency rate of exchange ruling at the reporting date. Non-monetary items that are measured in terms of historical cost in a currency other than US Dollar are translated using the exchange rates as at the dates of the initial transactions.

Non-monetary items measured at fair value in a currency other than US Dollar are translated using the exchange rates at the date when the fair value was determined. Foreign currency transaction gains and losses on financial instruments classified as at fair value through profit or loss are included in profit or loss in the Statement of Comprehensive Income as part of the "Change in fair value of investments at fair value through profit or loss". Exchange differences on other financial instruments are included in profit or loss in the Statement of Comprehensive Income as "Foreign exchange gain / (loss)". Gains and losses on foreign exchange during the period were immaterial and have been included as other operating expenses in the Statement of Comprehensive Income.

Financial instruments

In accordance with IFRS 9, financial assets and financial liabilities are recognised in the Company's Statement of Financial Position when the Company becomes a party to the contractual provisions of the instrument. Financial assets and financial liabilities are only offset and the net amount reported in the Statement of Financial Position and Statement of Comprehensive Income when there is a currently enforceable legal right to offset the recognised amounts and the Company intends to settle on a net basis or realise the asset and liability simultaneously.

Financial assets

When financial assets are recognised initially, they are measured at fair value. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

a) Investments at fair value through profit or loss

i. Classification and measurement

The Company's investments are classified as held at fair value through profit or loss as they are managed in a portfolio of assets on a fair value basis. Financial assets held at fair value through profit or loss are initially recognised at fair value, which is taken to be their cost, and are subsequently valued at fair value.

ii. Fair value estimation

The SPVs hold and manage the Company's underlying investments, which are valued at fair value, based on IPEV Valuation Guidelines and on IFRS. The fair value of the SPVs is considered to be their net asset value incorporating a valuation of the underlying investments. The Directors believe that this is appropriate, as:

·; the underlying investments within the SPVs are held on a fair value basis as described below and have taken into account risks to fair value, inclusive of liquidity discounts, through appropriate discount rates;

·; the Company wholly owns the SPVs and thus is entitled to all of their economic rights; and

·; the Directors take all these items into consideration and would make adjustments to net asset value, if deemed necessary.

Valuation process

The Investment Manager is responsible for proposing the valuation of the assets held by the Company through the SPVs and the Directors are responsible for reviewing the Company's valuation policy.

Valuation adviser

Due to the illiquid and subjective nature of the Company's underlying investments, the Investment Manager uses a third party valuation provider to perform a full independent valuation of the underlying investments. This includes the third party valuation provider selecting the valuation methodology and/or comparable companies; identifying the cash flows and appropriate discount rate utilised in a yield analysis; and providing a final value range to the Investment Manager. The valuation adviser independently values the assets and provides analyses to support the methodology in addition to presenting calculations used to generate output.

b) Cash and cash equivalents

Cash and cash equivalents comprise cash on hand and demand deposits and other short-term highly liquid investments with an original maturity of three months or less that are readily convertible to a known amount of cash and are subject to an insignificant risk of changes in value.

c) Trade receivables

Trade receivables are classified as financial assets at amortised cost. They are measured at amortised cost less impairment assessed using the simplified approach of the expected credit loss model based on current circumstances and expectations of future losses.

A financial asset is derecognised (in whole or in part) either:

·; when the Company has transferred substantially all the risks and rewards of ownership; or

·; when it has neither transferred nor retained substantially all the risks and rewards and when it no longer has control over the assets or a portion of the asset; or

·; when the contractual right to receive cash flow has expired.

Financial liabilities

d) Trade payables

Trade payables are classified as financial liabilities at amortised cost.

Equity

The Company's Ordinary Shares are classified as equity and upon issuance, the fair value of the consideration received is included in equity. Share issue costs were capped at 2 percent of the gross issue proceeds of the IPO and are shown in equity as a deduction from share premium. All other share issue costs of the Company, which were otherwise chargeable to equity, were borne by the Investment Manager.

Dividends

Dividends payable are recognised as distributions in the financial statements when the Company's obligation to make payment has been established.

Income recognition

Dividend income is recognised when the Company's entitlement to receive payment is established. Interest income is recognised on an accruals basis. Interest income due, but not received, is capitalised with the principal amount of the loan and may subsequently be reclassed as loan interest receivable. Dividend and interest income is allocated to Revenue within the Statement of Comprehensive Income.

Expenses

Expenses include legal, accounting, auditing and other operating expenses. They are recognised on an accruals basis in the Statement of Comprehensive Income in the period in which they are incurred.

Expenses are charged through the Revenue account except those which are capital in nature, including those which are incidental to the acquisition, disposal or enhancement of an investment, which are accounted for through the Capital account.

Taxation

It is the intention of the Directors to conduct the affairs of the Company so that it satisfies the conditions in section 1158 Corporation Tax Act 2010 and the Investment Trust (Approved Company) (Tax) Regulations 2011 for it to be approved by HMRC as an investment trust.

In respect of each accounting period for which the Company is and continues to be approved by HMRC as an investment trust, the Company will be exempt from UK corporation tax on its chargeable gains and its capital profits from creditor loan relationships. The Company will, however, be subject to UK corporation tax on its income (currently at a rate of 19 percent).

In principle, the Company will be liable to UK corporation tax on its dividend income. However, there are broad-ranging exemptions from this charge which would be expected to be applicable in respect of most of the dividends the Company may receive.

A company that is an approved investment trust in respect of an accounting period is able to take advantage of modified UK tax treatment in respect of its ''qualifying interest income'' for an accounting period. It is expected that the Company will have material amounts of qualifying interest income and that it may, therefore, decide to designate some or all of the dividends paid in respect of a given accounting period as interest distributions.

To the extent that the Company receives income from, or realises amounts on the disposal of, investments in foreign countries it may be subject to foreign withholding or other taxation in those jurisdictions. To the extent it relates to income, this foreign tax may, to the extent not relievable under a double tax treaty, be able to be treated as an expense for UK corporation tax purposes, or it may be treated as a credit against UK corporation tax up to certain limits and subject to certain conditions.

Deferred tax is the tax expected to be payable or recoverable on temporary differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit. Deferred tax liabilities are generally recognised for all taxable temporary differences and deferred tax assets are recognised to the extent that it is probable that taxable profits will be available against which deductible temporary differences can be utilised.

Deferred tax liabilities are recognised for taxable temporary differences arising on investments, except where the Company is able to control the timing of the reversal of the difference and it is probable that the temporary difference will not reverse in the foreseeable future. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited to the Statement of Comprehensive Income except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off tax assets against tax liabilities and when they relate to income taxes levied by the same taxation authority and the Company intends to settle its current tax assets and liabilities on a net basis. Deferred tax assets and liabilities are not discounted.

New and amended standards and interpretations not applied

Accounting standards and interpretations have been published and will be mandatory for the Company's accounting periods beginning on or after 1 January 2020 or later periods. The impact of these standards is not expected to be material to the reported results and financial position of the Company.

Going Concern

The Company retained $10.0 million of cash from the IPO. After settlement of share issue and expenses for the period, the cash balance at 31 December 2019 was $8.5 million, which is sufficient to cover the Company's existing liabilities of $0.3 million and dividend of $2.6 million with respect to the period ending 31 December 2019.

The Company's cash balance comprises cash and money market fixed deposits and the Company has no material going concern risk. Uninvested cash earned approximately 191 basis points during the period ended 31 December 2019.

In light of the above facts, the Directors are satisfied that it is appropriate to adopt the going concern basis in preparing the financial statements. In reaching this conclusion, the Board has considered budgeted and projected results of the business, projected cash flow and risks that could impact the Company's liquidity over the next twelve months.

Segmental reporting

The chief operating decision-maker, who is responsible for allocating resources and assessing performance of the operating segments, has been identified as the Board of Directors, as a whole. The key measure of performance used by the Board to assess the Company's performance and to allocate resources is the Company's Net Asset Value, as calculated under IFRS, and therefore no reconciliation is required between the measure of profit or loss used by the Board and that contained in the Annual Report.

For management purposes, the Company is organised into one main operating segment, which invests through its SPVs in a diversified portfolio of debt instruments, issued by Borrowers operating in the energy sector.

All of the Company's current income is derived from within the United States.

All of the Company's non-current assets are located in the United States.

Due to the Company's nature, it has no customers.

3. Significant accounting judgements, estimates and assumptions

The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses.

Estimates and judgements are continually evaluated and are based on management experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

Judgements

In the process of applying the Company's accounting policies, management has made the following judgements, which have the most significant effect on the amounts recognised in the financial statements:

Assessment as an Investment Entity

IFRS 10 "Consolidated Financial Statements" sets out the following 3 essential criteria that must be met, if a company is to be considered as an Investment Entity:

1. it must obtain funds from multiple investors for the purpose of providing those investors with investment management services;

2. it must commit to its investors that its business purpose is to invest funds solely for returns from capital appreciation, investment income, or both; and

3. it must measure and evaluate the performance of substantially all of its investments on a fair value basis.

In satisfying the second essential criteria, the notion of an investment time frame is critical and an Investment Entity should have an exit strategy for the realisation of its investments. Also as set out in IFRS 10, further consideration should be given to the typical characteristics of an Investment Entity, which are that:

·; it should have more than one investment, to diversify the risk portfolio and maximise returns;

·; it should have multiple investors, who pool their funds to maximise investment opportunities;

·; it should have investors that are not related parties of the entity; and

·; it should have ownership interests in the form of equity or similar interests.

The Directors are of the opinion that the Company meets the essential criteria and typical characteristics of an Investment Entity. Therefore the SPVs are measured at fair value through profit or loss, in accordance with IFRS 9 "Financial Instruments". Fair value is measured in accordance with IFRS 13 "Fair Value Measurement".

Assessment of the SPVs as structured entities

The Company considers the SPVs to be structured entities as defined by IFRS 12 "Disclosure of Interests in Other Entities". Transfer of funds by the SPVs to the Company is determined by the Investment Manager. The risks associated with the Company's investment in the SPVs are disclosed in note 15. The summarised financial information for the Company's investment in the SPVs is disclosed in note 4.

Estimates and assumptions

The area involving a high degree of judgement or complexity and where assumptions and estimates are significant to the financial statements has been identified as the risk of misstatement of the valuation of the investments (see note 4). Revisions to accounting estimates are recognised in the period in which the estimate is revised and in any future periods affected. The Board's determination that no discount or premium should be applied to the net asset value of the SPV involves a degree of judgement due to the nature of the underlying investments and other assets and liabilities and the valuation techniques and procedures adopted by the SPV.

The resulting accounting estimates will, by definition, seldom equal the related actual results.

4. Investments at fair value through profit or loss

The Company's investment in its SPVs comprises a loan investment and an equity investment, as set out above. The SPVs invest in a diversified portfolio of direct and indirect investments in loans, notes, bonds and other debt instruments.

Interest receivable on the loan investment at 31 December 2019 was $1,485k.

Reconciliation of loan interest recognised in the period

Fair value measurements

IFRS 13 requires disclosure of fair value measurement by level. The level of fair value hierarchy within the financial assets or financial liabilities is determined on the basis of the lowest level input that is significant to the fair value measurement. Financial assets and financial liabilities are classified in their entirety into only one of the following 3 levels:

• Level 1 - quoted prices (unadjusted) in active markets for identical assets or liabilities;

·; Level 2 - inputs other than quoted prices included within Level 1 that are observable for the assets or liabilities, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and

·; Level 3 - inputs for assets or liabilities that are not based on observable market data (unobservable inputs).

The determination of what constitutes 'observable' requires significant judgement by the Company. The Directors consider observable data to be market data that is readily available, regularly distributed or updated, reliable and verifiable, not proprietary, and provided by independent sources that are actively involved in the relevant market.

The only financial instruments held at fair value are the instruments held by the Company in the SPV, which are fair valued at each reporting date. The Company's investments have been classified within level 3 as the investments are not traded and contain unobservable inputs. The Company's investments are all considered to be level 3 assets.

Due to the nature of the investments, they are always expected to be classified as level 3. There have been no transfers between levels during the period. Any transfers between the levels would be accounted for on the last day of each financial period.

Valuation methodology and process

The Directors base the fair value of investment in the SPVs on the fair value of their assets and liabilities, adjusted if necessary, to reflect liquidity, future commitments, and other specific factors of the SPVs and Investment Manager. This is based on the components within the SPVs, principally the value of the SPVs' investments, in addition to cash and short-term money market fixed deposits. Any fluctuation in the value of the SPVs' investments held will directly impact on the value of the Company's investment in the SPVs.

The SPVs' investments are valued using the techniques described in the Company's valuation policy, as outlined in note 2. The Investment Manager's assessment of fair value of investments held by the SPVs is determined in accordance with IPEV Valuation Guidelines. When valuing the SPVs' investments, the Investment Manager reviews information provided by the underlying investee companies and other business partners and applies IPEV methodologies, to estimate a fair value as at the date of the Statement of Financial Position.

Initially, acquisitions are valued at the price of recent investment. Subsequently, and as appropriate, the Investment Manager values the investments on a quarterly basis using common industry valuation techniques, including comparable public market valuation, comparable merger and acquisition transaction valuation and discounted cash flow valuation. The techniques used in determining the fair value of the Company's investments through its SPVs are selected on an investment by investment basis so as to maximise the use of market based observable inputs. As disclosed in note 2, due to the illiquid and subjective nature of the Company's underlying investments, the Investment Manager uses a third party valuation provider to perform a full independent valuation of the underlying investments.

Quantitative information of significant unobservable inputs - Level 3 - SPV

The Directors believe that it is appropriate to measure the SPVs at their net asset value, incorporating a valuation of the underlying investments which has taken into account risks to fair value, inclusive of liquidity discounts, through appropriate discount rates.

Sensitivity analysis to significant changes in unobservable inputs within Level 3 hierarchy

The significant unobservable inputs used in the fair value measurement categorised within Level 3 of the fair value hierarchy together with a quantitative sensitivity analysis as at 31 December 2019 are as shown below:

The Company's valuation policy is compliant with both IFRS and IPEV Valuation Guidelines and is applied consistently. As the Company's investments are generally not publicly quoted, valuations require meaningful judgment to establish a range of values, and the ultimate value at which an investment is realised may differ from its most recent valuation and the difference may be significant.

For the period ended 31 December 2019, the valuations of the Company's investments, through its SPVs, are detailed in the Investment Manager's Report.

(a) The difference between the fair value of the SPVs and the fair value of the underlying investments is due to cash balances and residual assets of the SPVs.

5. Unconsolidated subsidiaries

The following table shows subsidiaries of the Company. As the Company is regarded as an Investment Entity as referred to in note 3, these subsidiaries have not been consolidated in the preparation of the financial statements:

The registered office of the above subsidiaries is c/o The Corporation Trust Company, Corporation Trust Center, 1209 Orange Street, Wilmington, Delaware 19801.

The amounts invested in the Company's unconsolidated subsidiaries during the year and their carrying value at 31 December 2019 are as outlined in note 4. This comprised $90,000,000 invested in Riverstone International Credit Corp., which was subsequently transferred to Riverstone International Credit - Direct L.P. to fund underlying investments. The Company intends to fund further underlying investments through its unconsolidated subsidiaries.

There are no restrictions on the ability of the Company's unconsolidated subsidiaries to transfer funds in the form of cash dividends or repayment of loans.

6. Trade and other receivables

7. Trade and other payables

8. Share capital

To enable the Company to obtain a certificate to commence business and to exercise its borrowing powers under section 761 CA 2006, on 11 March 2019, 1 E Share of £1 and 50,000 shares of £1 each were allotted to Riverstone Investment Group LLC and paid up in full, as Management Shares. The E Share and Management Shares grant the registered holders the right to receive notice of and to attend but, except where there are no other shares of the Company in issue, not to speak or vote at any general meeting of the Company. The Management Shares were redeemed in full on 28 May 2019 out of the proceeds of the IPO. The E Shares are not redeemable.

As at 31 December 2019 the Company's issued share capital comprises 100,000,000 Ordinary Shares and 1 E Share. Ordinary Shareholders are entitled to all dividends paid by the Company and, on a winding up, provided the Company has satisfied all of its liabilities, the Shareholders are entitled to all of the surplus assets of the Company.

9. Retained earnings

10. Audit fees

Other operating expenses include fees payable to the Company's Auditor, which can be analysed as follows:

The Company's Auditor was paid $234k in relation to work on the listing of the Company which is included in share issue costs.

The fees paid to the Company's Auditor for other audit related services were in relation to a review of the Interim Report. Other than this review, the services are non-recurring and permissible as non-audit services.

11. Tax

As an investment trust, the Company is exempt from UK corporation tax on capital gains arising on the disposal of shares. Capital profits from its loan relationships or derivative contracts are exempt from UK tax where the profits are accounted for through the Capital column of the Statement of Comprehensive Income, in accordance with the AIC SORP.

It is expected that the Company will make a streaming election to HMRC in respect of distributions and is entitled to deduct interest distributions paid out of income profits arising from its loan relationships in computing its UK corporation tax liability.

Therefore, no tax liability has been recognised in the financial statements.

As at 31 December 2019 the Company had no unprovided deferred tax assets or liabilities. At that date, based on current estimates and including the accumulation of net allowable losses, the Company had no unrelieved losses.

Deferred tax is not provided on capital gains and losses arising on the revaluation or disposal of investments because the Company meets (and intends to continue to meet for the foreseeable future) the conditions for approval as an Investment Trust company.

12. Profit Share

Under the Investment Management Agreement, the Investment Manager will not charge any base or other ongoing management fees, but will be entitled to reimbursement of reasonable expenses incurred by it in the performance of its duties. The Investment Manager will receive from the Company, a Profit Share based on the Company's income, as calculated for UK tax purposes and the Company's Capital Account. The Profit Share will be payable quarterly at the same time as the Company pays its dividends, subject to an annual reconciliation in the last quarter of each year.

The amount payable in respect of the annual Profit Share will be:

a) an amount equal to 20 percent of the amount by which the Distributable Income exceeds an amount equal to 4 percent of the Company's Capital Amount; plus

b) an additional amount equal to 10 percent of the amount by which the Distributable Income exceeds an amount equal to 8 percent of the Capital Amount.

The Capital Amount is equal to the gross proceeds of the issue of Ordinary Shares at IPO, plus the net proceeds of any future issues of Ordinary Shares, less any amounts expended by the Company on share repurchases and redemptions or, following the option to be given to Shareholder around the time of the Company's AGM in 2024 to elect to convert all or some of their shares into Realisation Shares.

Annual reconciliation and cap

At the end of the Company's first full financial year ending 31 December 2020, and at the end of each subsequent financial year, the Profit Share will undergo an annual reconciliation. In the event that the annual reconciliation results in a reduction of the aggregate Profit Share payable to the Investment Manager, the Profit Share payable in the fourth quarter will be reduced to no more than zero by the relevant amount, with any remaining reduction carried forward to Profit Shares otherwise payable in respect of future quarters. In addition, the amount payable to the Investment Manager as a Profit Share in any year will be limited to a maximum of 5 percent of the prevailing NAV.

Capital loss adjustment

If, in respect of the Company's first full financial year ending 31 December 2020, or if in any subsequent year, the Company suffers a capital loss which (disregarding the impact of any dividends paid or payable by the Company) causes the closing Net Asset Value per Ordinary Share for the year to fall below the lower of: (a) US$1.00; or (b) the closing Net Asset Value per Ordinary Share for the prior year, then the amount of the Distributable Income for the year equal to the amount by which the capital loss causes the Net Asset Value to fall below that threshold amount will be ignored for the purposes of calculating the Profit Share for that year. If the amount by which the capital loss causes the Net Asset Value to fall below the threshold amount is greater than the Distributable Income for the year, then the amount of any excess will be carried forward to following years until it is set off against Distributable Income in full. The capital loss test will be applied as a part of the annual reconciliation of the Profit Share.

Amounts paid or accrued as Profit Share during the period were $67k.

13. Earnings per share and Net assets per share

Earnings per share

There was no income earned on ordinary shares issued between 11 March 2019 and 28 May 2019, therefore this period has not been included for the purpose of calculating the weighted average number of shares above.

There are no dilutive shares in issue.

Net assets per share

14. Dividends declared with respect to the period

On 19 February 2020, the Board approved a dividend of 2.57 cents per share with respect to the period ended 31 December 2019. The record date for the dividend is 28 February 2020 and the payment date is 27 March 2020.

15. Financial risk management

Financial risk management objectives

The Company's investing activities, through its investment in the SPVs, intentionally expose it to various types of risks that are associated with the underlying investee companies of the SPVs. The Company makes the investment in order to generate returns in accordance with its investment policy and objectives.

The most important types of financial risks to which the Company is exposed are market risk (including price, interest rate and foreign currency risk), liquidity risk and credit risk. The Board of Directors has overall responsibility for the determination of the Company's risk management and sets policy to manage that risk at an acceptable level to achieve those objectives. The policy and process for measuring and mitigating each of the main risks are described below.

The Investment Manager and the Administrator provide advice to the Company which allows it to monitor and manage financial risks relating to its operations through internal risk reports which analyse exposures by degree and magnitude of risks. The Investment Manager and the Administrator report to the Board on a quarterly basis.

Categories of financial instruments

Capital risk management

The Company manages its capital to ensure that it will be able to continue as a going concern while maximising the capital return to Shareholders. The capital structure of the Company consists of issued share capital, retained earnings and other distributable reserves, as stated in the Statement of Financial Position.

In order to maintain or adjust the capital structure, the Company may buy back shares or issue new shares. There are no external capital requirements imposed on the Company.

During the period ended 31 December 2019, the Company had no borrowings.

The Company's investment policy is set out in the Strategic Report above.

Market risk

Market risk includes price risk, foreign currency risk and interest rate risk.

a) Price risk

The underlying investments held by the SPVs present a potential risk of loss of capital to the SPVs and hence to the Company. The Company invests through the SPVs. Price risk arises from uncertainty about future prices of underlying financial investments held by the SPVs. As at 31 December 2019, the fair value of investments was $91,541k and a 3 percent increase / (decrease) in the price of investments with all other variables held constant would result in a change to the fair value of investments of + / - $2,746. A change in interest rates could have an impact on the price risk associated with the underlying investee companies, which is factored into the fair value of investments. Please refer to note 4 for quantitative information about the fair value measurements of the Company's Level 3 investments.

The SPVs are exposed to a variety of risks which may have an impact on the carrying value of the Company's investments. The SPV's risk factors are set out in (a)(i) to (a)(iii) below.

i. Not actively traded

The SPVs' investments are not generally traded in an active market but are indirectly exposed to market price risk arising from uncertainties about future values of the investments held. The underlying investments of the SPVs vary as to industry sub-sector, geographic distribution of operations and size, all of which may impact the susceptibility of their valuation to uncertainty.

Although the investments are in the same industry, this risk is managed through careful selection of investments within the specified limits of the investment policy. The investments are monitored on a regular basis by the Investment Manager.

ii. Concentration

The Company, through the SPVs, invests in the energy sector, with a particular focus on businesses that engage in oil and gas E&P and midstream investments in that sector. This means that the Company is exposed to the concentration risk of only making investments in the energy sector, which concentration risk may further relate to sub-sector, geography, and the relative size of an investment or other factors. Whilst the Company is subject to the investment and diversification restrictions in its investment policy, within those limits, material concentrations of investments may arise.

The Board and the Investment Manager monitor the concentration of the investment in the SPVs on a quarterly basis to ensure compliance with the investment policy.

iii. Liquidity

The Company's liquidity risk lies with its SPVs as the amount of cash invested through the SPVs in the underlying investments is dynamic in nature. The SPVs will maintain flexibility in funding by keeping sufficient liquidity in cash and cash equivalents, which may be invested on a temporary basis in line with the cash management policy as agreed by the Board from time to time.

As at 31 December 2019, $52.4 million or 57.4 percent of the SPVs' financial assets, were money market fixed deposits and cash balances held on deposit with several A- or higher rated banks.

b) Foreign currency risk

The Company has exposure to foreign currency risk due to the payment of some expenses in Pounds Sterling. Consequently, the Company is exposed to risks that the exchange rate of its currency relative to other foreign currencies may change in a manner that has an adverse effect on the value of that portion of the Company's assets or liabilities denominated in currencies other than the US Dollar. Any exposure to foreign currency risk at the underlying investment level is captured within price risk.

The following table sets out, in US Dollars, the Company's total exposure to foreign currency risk and the net exposure to foreign currencies of the monetary assets and liabilities:

The Directors do not consider that the foreign currency exchange risk at the balance sheet date is material and therefore sensitivity analysis for the foreign currency risk has not been provided.

c) Interest rate risk

The Company's exposure to interest rate risk relates to the Company's cash and cash equivalents held through the Company's SPVs. The Company is subject to risk due to fluctuations in the prevailing levels of market interest rates. Any excess cash and cash equivalents are invested at short-term market interest rates. As at the date of the Statement of Financial Position, the majority of the Company's cash and cash equivalents were held on interest bearing fixed deposit accounts at the SPVs. Any exposure to interest rate risk at the underlying investment level is captured within price risk.

The Company has no other interest-bearing assets or liabilities as at the reporting date. As a consequence, the Company is only exposed to variable market interest rate risk. As at 31 December 2019, cash balance held by the Company (including cash held at the SPVs) was $61.0 million. A 0.5 percent increase / (decrease) in interest rates with all other variables held constant would result in a change to interest received of + / - $304,855 per annum.

Liquidity risk

Ultimate responsibility for liquidity risk management rests with the Board of Directors.

Liquidity risk is defined as the risk that the Company may not be able to settle or meet its obligations on time or at a reasonable price.

The Company adopts a prudent approach to liquidity management and through the preparation of budgets and cash flow forecasts maintains sufficient cash reserves to meet its obligations.

Credit risk

Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Company. Any exposure to credit risk at the underlying investment level is captured within price risk.

The carrying value of the investment in the SPVs as at 31 December 2019 was $91.5 million.

Financial assets mainly consist of cash and cash equivalents and investments at fair value through profit or loss. The Company's risk on liquid funds is reduced because it can only deposit monies with institutions with a minimum credit rating of "A-". The Company mitigates its credit risk exposure on its investments at fair value through profit or loss by the exercise of due diligence on the counterparties of the SPVs and the Investment Manager.

The table below shows the material cash balances and the credit rating for the counterparties used at the period end date:

The Company's maximum exposure to loss of capital at the period end is shown below:

Gearing

As at the date of these financial statements the Company has no gearing.

16. Related party transactions

Directors

The Company has three non-executive Directors. Directors' fees for the period ended 31 December 2019 amounted to $115k, of which $nil was outstanding at period end. Amounts paid to Directors as reimbursement of travel and other incidental expenses during the period amounted to $50k, of which $nil was outstanding at period end.

SPVs

During the period, the Company provided a loan to the US Corp. of $62,100,000, which accrues interest at 9.27 percent. Any unpaid interest at each quarter end is capitalised and added to the loan balance. Total interest in relation to the period was $3,451,691 of which $1,202,785 was received in cash, $764,200 was capitalised and $1,484,706 remained outstanding at 31 December 2019. During the period, $nil loan principal was repaid and the balance on the loan investment at 31 December 2019 was $62,864,200.

The Company's other investments in its SPVs are made via equity shareholdings as disclosed in note 4.

Investment Manager

The Investment Manager is an affiliate of Riverstone and provides advice to the Company on the origination and completion of new investments, the management of the portfolio and on realisations, as well as on funding requirements, subject to Board approval. For the provision of services under the Investment Management Agreement, the Investment Manager earns a Profit Share, as detailed in note 12.

17. Ultimate controlling party

In the opinion of the Board, on the basis of the shareholdings advised to them, the Company has no ultimate controlling party.

18. Subsequent events

On 14 January 2020, the Company purchased an allocation in Project Beach II, a first lien term loan that was previously originated by and currently in the portfolio of Riverstone's private credit funds. At closing, $8.7 million was committed by the Company. The first lien term loan was then subsequently realised on 28 January 2020.

There are no other significant subsequent events.

Glossary of Capitalised Defined Terms

Administrator means Estera Administration UK Limited

Admission means admission of the Ordinary Shares on 28 May 2019, to the Official List and/or admission to trading on the Specialist Fund Segment of the London Stock Exchange, as the context may require;

AGM means Annual General Meeting

AIC means the Association of Investment Companies

AIC Code means the AIC Code of Corporate Governance

AIC SORP means the Statement of Recommended Practice issued by the AIC in November 2014 and updated in January 2017 for the Financial Statements of Investment Trust Companies and Venture Capital Trusts