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30 Jan 2018 07:00
30 January 2018
Red Emperor Resources NL ("Red Emperor")
Quarterly Reports
For the Period Ending 31 December 2017 and Appendix 5B
The Board of Red Emperor Resources NL ("Red Emperor" or the "Company") provides the following commentary and Appendix 5B for the period ending 31 December 2017.
California
During the quarter, the Joint Venture formed to identify a number of strategic leases in California, prospective for oil & gas, made considerable progress in the complicated process of conducting the title searches required to identify and confirm the legal owners of the relevant mineral leases. The work required to complete a full chain of title takes time, however the majority of this work is now complete. Owners have now been presented with formal lease agreements and the JV hopes execution of these agreements will start occurring over the coming week(s).
While the specific location of the leases will remain confidential until a material amount of the prospect area(s) can be acquired, the Company again advises that in return for funding 100% of the lease acquisition costs, as well as the acquisition and reprocessing of relevant seismic data, Red Emperor will earn a 60% interest in the newly established Joint Venture and any subsequent leases acquired. The total budget, inclusive of Landman fees, for the proposed acquisition is USD640,000, after which Red Emperor will be responsible for its 60% equity interest. Despite a delay in timing, the JV remains within budget to complete these acquisitions and looks forward to updating the market in the coming weeks.
Philippines (SC 55)
Red Emperor continues to be frustrated by the process and progress of the Philippines Department of Energy and the lengthy delays associated with the ratification of the Company's equity interest increase in Block SC55. To this end, Red Emperor is now considering the merits of maintaining its equity interest in the Block and has sought advice regarding the potential disposal of its interest. Despite participating in a USD25m exploration well (Hawkeye) within the block in 2015 and contributing in excess of AUD5m towards drilling costs, the board must weigh the costs of maintaining the Block against its materiality in the current environment and the other assets currently being acquired by the Company.
Over USD50m has been spent exploring the block to date and a number of drill-ready targets remain, including the "Cinco" gas prospect which has a best estimate prospective resource of 1.6tcf recoverable gas.
Georgia
Red Emperor had negotiated and in principally agreed to sell its 20% interest in Strait Oil & Gas to Range Resources Limited for a nominal sum and a royalty, however the completion of this sale was delayed by Range's re-admission process to the AIM in the UK. Red Emperor remains in discussion with Range, although it acknowledges that the consideration being discussed is not material to the Company.
For further information please visit http://www.redemperorresources.com/ or contact:
Red Emperor Resources:
Greg Bandy +61 8 9212 0102
Grant Thornton UK LLP (Nominated Adviser):Philip Secrett, Jen Clarke 020 7383 5100
Appendix 5B
Mining exploration entity and oil and gas exploration entity quarterly report
Introduced 01/07/96 Origin Appendix 8 Amended 01/07/97, 01/07/98, 30/09/01, 01/06/10, 17/12/10, 01/05/13, 01/09/16
Name of entity | ||
RED EMPEROR RESOURCES NL | ||
ABN | Quarter ended ("current quarter") | |
99 124 734 961 | 31 December 2017 | |
Consolidated statement of cash flows | Current quarter $A'000 | Year to date (6 months)$A'000 | ||
1. | Cash flows from operating activities | - | - | |
1.1 | Receipts from customers | |||
1.2 | Payments for | (13) | (13) | |
(a) exploration & evaluation | ||||
(b) development | - | - | ||
(c) production | - | - | ||
(d) staff costs | - | - | ||
(e) administration and corporate costs | (294) | (487) | ||
1.3 | Dividends received (see note 3) | - | - | |
1.4 | Interest received | 34 | 69 | |
1.5 | Interest and other costs of finance paid | - | - | |
1.6 | Income taxes paid | - | - | |
1.7 | Research and development refunds | - | - | |
1.8 | Other (provide details if material) | 10 | 10 | |
1.9 | Net cash from / (used in) operating activities | (263) | (421) | |
2. | Cash flows from investing activities | - | - | |
2.1 | Payments to acquire: | |||
(a) property, plant and equipment | ||||
(b) tenements (see item 10) | - | - | ||
(c) investments | - | - | ||
(d) other non-current assets | - | - | ||
2.2 | Proceeds from the disposal of: | - | - | |
(a) property, plant and equipment | ||||
(b) tenements (see item 10) | - | - | ||
(c) investments | - | - | ||
(d) other non-current assets | - | - | ||
2.3 | Cash flows from loans to other entities | - | - | |
2.4 | Dividends received (see note 3) | - | - | |
2.5 | Other (provide details if material) | - | - | |
2.6 | Net cash from / (used in) investing activities | - | - | |
3. | Cash flows from financing activities | - | - | |
3.1 | Proceeds from issues of shares | |||
3.2 | Proceeds from issue of convertible notes | - | - | |
3.3 | Proceeds from exercise of share options | - | - | |
3.4 | Transaction costs related to issues of shares, convertible notes or options | - | - | |
3.5 | Proceeds from borrowings | - | - | |
3.6 | Repayment of borrowings | - | - | |
3.7 | Transaction costs related to loans and borrowings | - | - | |
3.8 | Dividends paid | - | - | |
3.9 | Other (provide details if material) | - | - | |
3.10 | Net cash from / (used in) financing activities | - | - | |
4. | Net increase / (decrease) in cash and cash equivalents for the period | 10,729 | 10,921 | |
4.1 | Cash and cash equivalents at beginning of period | |||
4.2 | Net cash from / (used in) operating activities (item 1.9 above) | (263) | (421) | |
4.3 | Net cash from / (used in) investing activities (item 2.6 above) |
- |
- | |
4.4 | Net cash from / (used in) financing activities (item 3.10 above) |
- |
- | |
4.5 | Effect of movement in exchange rates on cash held |
12 |
(22) | |
4.6 | Cash and cash equivalents at end of period | 10,478 | 10,478 | |
5. | Reconciliation of cash and cash equivalentsat the end of the quarter (as shown in the consolidated statement of cash flows) to the related items in the accounts | Current quarter$A'000 | Previous quarter$A'000 |
5.1 | Bank balances | 10,478 | 10,729 |
5.2 | Call deposits | - | - |
5.3 | Bank overdrafts | - | - |
5.4 | Other (provide details) | - | - |
5.5 | Cash and cash equivalents at end of quarter (should equal item 4.6 above) | 10,478 | 10,729 |
6. | Payments to directors of the entity and their associates | Current quarter$A'000 |
6.1 | Aggregate amount of payments to these parties included in item 1.2 | 56 |
6.2 | Aggregate amount of cash flow from loans to these parties included in item 2.3 | - |
6.3 | Include below any explanation necessary to understand the transactions included in items 6.1 and 6.2 | |
Payment of Directors Fees and Remuneration - $56k
| ||
7. | Payments to related entities of the entity and their associates | Current quarter$A'000 |
7.1 | Aggregate amount of payments to these parties included in item 1.2 | - |
7.2 | Aggregate amount of cash flow from loans to these parties included in item 2.3 | - |
7.3 | Include below any explanation necessary to understand the transactions included in items 7.1 and 7.2 | |
N/A
| ||
8. | Financing facilities availableAdd notes as necessary for an understanding of the position | Total facility amount at quarter end$A'000 | Amount drawn at quarter end$A'000 |
8.1 | Loan facilities | - | - |
8.2 | Credit standby arrangements | - | - |
8.3 | Other (please specify) | - | - |
8.4 | Include below a description of each facility above, including the lender, interest rate and whether it is secured or unsecured. If any additional facilities have been entered into or are proposed to be entered into after quarter end, include details of those facilities as well. | ||
N/A
| |||
9. | Estimated cash outflows for next quarter | $A'000 |
9.1 | Exploration and evaluation | 50,000 |
9.2 | Development | - |
9.3 | Production | - |
9.4 | Staff costs | - |
9.5 | Administration and corporate costs | 100,000 |
9.6 | Other (provide details if material) | - |
9.7 | Total estimated cash outflows | 150,000 |
10. | Changes in tenements(items 2.1(b) and 2.2(b) above) | Tenement reference and location | Nature of interest | Interest at beginning of quarter | Interest at end of quarter |
10.1 | Interests in mining tenements and petroleum tenements lapsed, relinquished or reduced | N/A | |||
10.2 | Interests in mining tenements and petroleum tenements acquired or increased | N/A |
Compliance statement
1 This statement has been prepared in accordance with accounting standards and policies which comply with Listing Rule 19.11A.
2 This statement gives a true and fair view of the matters disclosed.
Date: 30 January 2018
Print name: Aaron Bertolatti
Notes
1. The quarterly report provides a basis for informing the market how the entity's activities have been financed for the past quarter and the effect on its cash position. An entity that wishes to disclose additional information is encouraged to do so, in a note or notes included in or attached to this report.
2. If this quarterly report has been prepared in accordance with Australian Accounting Standards, the definitions in, and provisions of, AASB 6: Exploration for and Evaluation of Mineral Resources and AASB 107: Statement of Cash Flows apply to this report. If this quarterly report has been prepared in accordance with other accounting standards agreed by ASX pursuant to Listing Rule 19.11A, the corresponding equivalent standards apply to this report.
3. Dividends received may be classified either as cash flows from operating activities or cash flows from investing activities, depending on the accounting policy of the entity.
The information contained within this announcement is considered to be inside information, for the purposes of Article 7 of EU Regulation 596/2014, prior to its release.
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