26 Jan 2017 12:55
26 January 2017
Red Emperor Resources NL ("Red Emperor")
Quarterly Reports
For The Period Ending 31 December 2016 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 2016.
Philippines (SC 55)
After providing the Philippines Department of Energy with all relevant documentation for the transfer of Otto Energy Limited's (ASX: OEL "Otto") equity interest in Block SC 55, Red Emperor have been awaiting formal approval and ratification for its equity interest to increase from 15% to 37.5%. Subsequent to the quarter end, the DoE has requested further information from Otto, which the Joint Venture believes it has already provided. Red Emperor continues to await the outcome of this process and acknowledges it has taken far longer than anticipated.
In June last year, the DoE formally granted a two-year moratorium, until 23 December 2017, on required work activity under Service Contract 55. During the moratorium period, the JV will conduct specialised geophysical studies in the area surrounding the Hawkeye Prospect, which encountered gas shows when it was drilled in August 2015. Although the Hawkeye well did not encounter gas in commercial quantities, it proved the presence of an active petroleum system in the contract area that hosts the "Cinco Prospect" as well as several other leads.
Georgia
Red Emperor continues to be advised that sale negotiations continue with at least one interested party for the purchase of Block VIa. Red Emperor is not involved in the negotiations, although remains a 20% shareholder of Strait Oil and Gas Ltd which currently holds the Production Sharing Contract across Block VIa.
Corporate
The Board of Red Emperor have been particularly active over the past quarter and during the period made an offer to acquire a US based exploration company with assets in the United States. Discussions were very well advanced and while they did not result in a transaction, both parties continue to engage with each other. Red Emperor are currently in separate negotiations with a potential strategic partner regarding both financing and asset participation. The focus of these discussions has been on opportunities in the USA and the Company will be represented at the NAPE Conference in Houston next month, where it hopes to further these discussions with the aim of completing a transaction in the near term. The Board is mindful of the patience shown by its shareholders, both in the UK and Australia, and thanks them for their support.
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, Jamie Barklem 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 2016 | |
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 | - | - | |
(a) exploration & evaluation | ||||
(b) development | - | - | ||
(c) production | - | - | ||
(d) staff costs | - | - | ||
(e) administration and corporate costs | (159) | (437) | ||
1.3 | Dividends received (see note 3) | - | - | |
1.4 | Interest received | 41 | 85 | |
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) | - | - | |
1.9 | Net cash from / (used in) operating activities | (118) | (352) | |
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 | 11,385 | 11,715 | |
4.1 | Cash and cash equivalents at beginning of period | |||
4.2 | Net cash from / (used in) operating activities (item 1.9 above) |
(118) |
(352) | |
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 |
136 |
(40) | |
4.6 | Cash and cash equivalents at end of period | 11,403 | 11,403 | |
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 | 11,403 | 11,385 |
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) | 11,403 | 11,385 |
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 | 68 |
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 - $68k
| ||
7. | Payments to related entities of the entity and their associates | Current quarter$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 | - |
9.2 | Development | - |
9.3 | Production | - |
9.4 | Staff costs | - |
9.5 | Administration and corporate costs | 150,000 |
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: 26 January 2017
Print name: Aaron Bertolatti (Company secretary)
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.