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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Petroneft Resources Plc | LSE:PTR | London | Ordinary Share | IE00B0Q82B24 | ORD EUR0.01 (CDI) |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 0.085 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
From Apr 2019 to Apr 2024
TIDMPTR
RNS Number : 4699A
Petroneft Resources PLC
29 September 2015
29 September 2015
PetroNeft Resources plc
("PetroNeft" or the "Group" or the "Company")
2015 Interim Results
PetroNeft (AIM: PTR) an oil & gas exploration and production company operating in the Tomsk Oblast, Russian Federation, and 50% owner and operator of Licences 61 and 67 is pleased to report its results for the 6 months ended 30 June 2015.
Highlights
-- Current gross production from Licence 61 is about 2,700 bopd. o Represents a 46% increase in production in 2015.
-- New wells drilled at Tungolskoye, Sibkrayevskoye, West Lineynoye and Arbuzovskoye during period.
-- 1,000 km of high resolution 2D seismic data acquired at Licence 61
David Golder, Chairman of PetroNeft Resources plc, commented:
"We have had an exceptionally busy year so far, with good success in growing production by over 40% and in enhancing our understanding of Licence 61 through the acquisition of new seismic data.
Given that market conditions remain challenging with little sign of improvement in oil prices in the near term, our focus is on growing production, managing costs and positioning the company for any improvement in the market conditions. We look forward to updating shareholders of our results over the coming year."
For further information, contact:
Dennis Francis, CEO, PetroNeft Resources +1 713 988 plc 2500 Paul Dowling, CFO, PetroNeft Resources +353 1 647 plc 0280 John Frain/Brian Garrahy, Davy (NOMAD +353 1 679 and Joint Broker) 6363 Henry Fitzgerald-O'Connor, Canaccord +44 207 Genuity Limited (Joint Broker) 523 8000 Martin Jackson/Shabnam Bashir, Citigate +44 207 Dewe Rogerson 638 9571 Joe Heron / Douglas Keatinge, Murray +353 1 498 Consultants 0300
The information contained in this announcement has been reviewed and verified by Mr. Dennis Francis, Director and Chief Executive Officer of PetroNeft, for the purposes of the Guidance Note for Mining and Oil & Gas Companies issued by the London Stock Exchange in June 2009. Mr. Francis holds a B.S. Degree in Geophysical Engineering and a M.S. Degree in Geology from the Colorado School of Mines. He has also graduated from the Harvard University Program for Management Development. He is a member of the American Association of Petroleum Geologists and the Society of Exploration Geophysicists. He has over 40 years' experience in oil and gas exploration and development.
Chairman's Statement
Dear Shareholder,
I am pleased to report on the activities of the Group for the six months to 30 June 2015 and provide an update on recent progress. 2015 has been a busy year to date with significant work undertaken at Licence 61, together with our 50% co-venturer Oil India Limited, including the drilling of new production wells at Tungolskoye, construction of tie-in infrastructure, acquisition of new seismic data and the drilling of a key delineation well at Sibkrayevskoye. Current gross production at Licence 61 is approximately 2,700 bopd, an increase of 46% in the year to date.
Production and Sales
Gross production at Licence 61 in the six months to 30 June 2015 averaged 1,744 bopd, a 19% decrease compared to the same period in 2014 (2,163 bopd). The decrease was as a result of natural decline and the fact that the new production wells at Tungolskoye and West Lineynoye did not come online until Q3 2015. We sold 329,733 (gross) barrels of oil in the six months to 30 June 2015 (H1 2013: 391,379 bbls) and achieved an average oil price of $29.87 (H1 2014: $44.79). The fall in price is reflective of the challenges being faced across the oil and gas industry.
Gross production at Licence 61 has grown by 46% in the year to date and is currently approximately 2,700 bopd. Most of the production growth in 2015 came from the T-503 and T-502 wells at Tungolskoye which came online in July and September 2015 respectively.
Tungolskoye
Early in 2015 we successfully completed the Tungolskoye No. 5 (T-5) well which demonstrated the higher levels of productivity that can be achieved in horizontal wells and gave us the data required to sanction the development of the Tungolskoye oil field.
While the T-5 well achieved high initial oil flow rates it subsequently demonstrated a high water cut. Further examination indicated that the water was likely coming from a transition zone below the main producing horizon where the horizontal segment of the well had been targeted. We determined that this risk could be substantially mitigated by focussing future horizontal wells primarily on the J1-1 horizon.
The development of Tungolskoye entailed the construction of a 25 km pipeline and utility line to connect back to the Central Processing Facility ("CPF") at Lineynoye. Drilling of new wells commenced in May 2015 using SGK Drilling, a subsidiary of Eurasia Drilling, Russia's largest drilling company. The rig used was a production drilling rig fitted with a top drive unit that enables faster and more efficient drilling of long-reach horizontal segments.
We have drilled two horizontal and three vertical wells at Tungolskoye up to 28 September 2015 and anticipate two more horizontal wells and one vertical well to be completed by the end of the year. The T-503 and T-502 wells both had horizontal segments of approximately 1,000 metres and both achieved net pay of about 65% in the horizontal segment. The horizontal segment of both wells was drilled in the J1-1 horizon only, building on the lessons learned from the T-5 well. The average flow rates for the first 14 days post clean-up were 499 bopd and 481 bopd respectively with a water cut of less than 10% on both wells. The three vertical wells drilled to date (T-51B, T-508 and T-507) were to provide stratigraphic confirmation prior to drilling the next horizontal well and, in the case of T-51B, will be used as a water source well, and water injection wells in the case of the remaining vertical wells. The T-501 horizontal well is currently being drilled and we hope to bring it on production in late October.
Arbuzovskoye
In the early part of 2015 we completed a five well production drilling programme at Arbuzovskoye. The most important result was the A-103 vertical well which was drilled as far south as possible from Pad 1. The aim of this well was to enhance our understanding of the southern portion of Arbuzovskoye before committing to the construction of a second pad there.
The well came in 15 metres high to prognosis and produced an initial rate of 125 bopd. This result, combined with some new 2D seismic data acquired in 2015, has given us the confidence to plan for a second pad at Arbuzovskoye which will likely see the drilling of two to three horizontal wells in 2016. The pad is currently under construction. Given the thicker pays and better quality reservoir rock that we have seen at Arbuzovskoye as compared to Tungolskoye and the lessons learned from the horizontal drilling at Tungolskoye, we are targeting superior results at the south Arbuzovskoye pad in 2016.
Sibkrayevskoye
In the first half of 2015, we drilled the S-373 delineation well at Sibkrayevskoye. The well confirmed over ten metres of net oil pay and achieved a stabilised natural flow of 100 bopd from a cased hole test. We expect to bring this well into production for the winter of 2015/16.
We also acquired 1,000 km of high resolution 2D seismic data in the northern portion of Licence 61. The primary focus of the seismic was at Sibkrayevskoye and Emtorskaya as well as some other smaller leads and prospects in the area. The acquisition of data was completed in April 2015 and the data is currently being processed and interpreted. All previous seismic data and exploration well logs will also be re-processed and interpreted in order to have a single consistent database of the seismic and well data. While the interpretation process is not yet complete, initial results indicate that the Sibkrayevskoye oil field is considerably larger than previously mapped and the Emtorskaya prospect is also larger and better defined than previously mapped.
The S-373 result combined with the new seismic should lead to a significant reserve upgrade at year-end.
West Lineynoye
In July 2015 we announced the result of the L-10 horizontal well at West Lineynoye. The well was drilled close to the L-8 well which has been producing for several years. As the well was drilled with an exploration drilling rig with no top drive it was only possible to drill a horizontal segment of about 265 metres. Of this 55 metres was classified as productive net pay and the average flow rate for the first 14 days post clean-up was 189 bopd. We had hoped to achieve a rate closer to 300 bopd but have learned lessons from the drilling of this and the T-5 well with exploration rigs that should enable us to drill longer horizontal segments in future, thereby achieving higher flow rates.
Review of PetroNeft loss for the period
(MORE TO FOLLOW) Dow Jones Newswires
September 29, 2015 02:01 ET (06:01 GMT)
The loss for the period was US$1.4m (2014: US$2.7m). The loss includes PetroNeft's share of the losses on the joint ventures relating to Licences 61 and 67 of US$1.8m and US$0.2m respectively. The loss relating to the Licence 61 joint venture is discussed in more detail below. Finance revenue of US$1.5m relates primarily to interest receivable on loans to the joint ventures.
Hot Features
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PetroNeft Key Financial Metrics Unaudited Audited
====================
6 months 6 months
ended ended Year ended
30 June 30 June 31 December
2015 2014 2014
US$ '000 US$ '000 US$ '000
Continuing operations
Revenue 1,220 17,528 19,165
Cost of sales (1,206) (13,384) (15,233)
Gross profit 14 4,144 3,932
Administrative expenses (572) (3,122) (3,678)
Exchange gain/(loss) on intra-Group
loans 17 (2,061) (2,402)
Operating loss (541) (1,039) (2,148)
Loss on disposal of subsidiary
undertaking - - (5,569)
Share of joint venture's net
loss - WorldAce Investments
Limited (1,829) - (304)
Share of joint venture's net
loss - Russian BD Holdings
B.V. (157) (121) (294)
Finance revenue 1,504 27 1,551
Finance costs - (1,576) (1,612)
Loss for the period for continuing
operations before taxation (1,023) (2,709) (8,376)
Income tax expense (393) (20) (408)
========= =========
Loss for the period (1,416) (2,729) (8,784)
========= ========= =============
Licence 61 joint venture - WorldAce Group
The metrics below are an extraction from the financial statements of the WorldAce Group which demonstrate the performance of Licence 61:
PetroNeft's 100% of WorldAce
50% share 6 months 12 months
6 months ended ended
ended 30 30 June 31 December
June 2015 2015 2014
US$'000 US$'000 US$'000
Continuing operations
Revenue 4,925 9,849 29,289
Cost of sales (4,767) (9,533) (26,379)
============
Gross profit 158 316 2,910
Gross margin % 3.21% 3.21% 9.93%
Administrative
expenses (831) (1,661) (5,129)
============
Operating loss (673) (1,345) (2,219)
Finance revenue 6 12 16
Finance costs (1,162) (2,324) (1,818)
=========
Loss for the period
for continuing
operations before
taxation (1,829) (3,657) (4,021)
Income tax credit - - 2,400
Loss for the period (1,829) (3,657) (1,621)
============ ========= =============
WorldAce Analysis 100% of WorldAce
6 months 12 months
ended ended
30 June 31 December
2015 2014
US$'000 US$'000
Revenue
Oil Sales 9,817 29,179
Other sales 32 110
========= -------------
Total revenue 9,849 29,289
========= =============
Cost of Sales
Mineral Extraction
Tax 4,990 14,975
Pipeline tariff 1,270 2,399
Staff costs 915 2,114
Depreciation and
amortisation 1,034 2,897
Other cost of sales 1,324 3,994
Total cost of sales 9,533 26,379
========= =============
The detailed Income Statement and Balance Sheet of WorldAce Investments Limited is disclosed at note 7 to these condensed financial statements. Lower production and much lower oil prices have reduced the margin from 9.9% in 2014 to 3.2% in H1 2015. With the higher production being achieved in the second half of 2015 we should be able to improve the margin as many
of our production costs are fixed. Against the back drop of continued lower oil prices we are concentrating on trying to reduce costs and focus efforts and capital on areas that can provide additional near term production and operating cash flows for the Licence 61 joint venture.
As at 30 June 2015 WorldAce had cash at bank of US$2.5 million and had drawn-down US$41.5 million of the US$45 million Oil India investment. It is expected that the entire US$45 million will be drawn by the end of 2015. Based on current forecasts it should be possible to fund the development of south Arbuzovskoye from 2016 operating cash flows but additional funding would be required to advance other projects, such as Sibkrayevskoye, in 2016. The final work programme and budget for 2016 will be agreed with Oil India before the end of 2015.
Licence 67
During the first quarter of 2015, we agreed an exploration programme for Licence 67 for the next five years with the Russian authorities, the first significant expenditure required will be in 2017. We view Licence 67 as having considerable longer term potential and we are also discussing forward plans with our joint venture partner Belgrave Naftogas (Arawak Energy).
Director retirement
On 18 September 2015 Non-Executive Director, Vakha Sobraliev, retired from the Board of PetroNeft in order to concentrate on his other business interests. Mr. Sobraliev had been a director since November 2005 and introduced Licence 61 to the Company at its formation in 2005. He was also key to the establishment of the Company's operations and experienced team in Tomsk. On behalf of the Company and its shareholders I would like to place on record our appreciation for Vakha's service and advice over the years and in particular for his contribution to the original setup of operations in Tomsk. We wish him every success in the future.
Outlook
Whilst we have had an exceptionally busy year so far, with good success in growing production and our understanding of the Licence, market conditions are very challenging and there is little sign of improvement in oil prices in the near term. We still expect further growth in production this year from the remaining wells to be drilled at Tungolskoye and next year from the addition of new wells at south Arbuzovskoye. Our focus is on growing production, managing costs and positioning the Company for any improvement in the market conditions. We look forward to updating shareholders of our results over the coming year.
David Golder
Non-Executive Chairman
28 September 2015
Interim Condensed Consolidated Income Statement
For the 6 months ended 30 June 2015
Unaudited Audited
===========================
6 months 6 months
ended ended Year ended
30 June 30 June 31 December
Note 2015 2014 2014
US$ US$ US$
Continuing operations
Revenue 1,220,323 17,527,910 19,165,456
Cost of sales (1,205,656) (13,383,948) (15,233,532)
============ ============= -------------
Gross profit 14,667 4,143,962 3,931,924
Administrative expenses (572,017) (3,122,218) (3,677,947)
Exchange gain/ (loss) on
intra-Group loans 16,401 (2,060,685) (2,401,138)
============ ============= -------------
Operating loss (540,949) (1,038,941) (2,147,161)
Loss on disposal of subsidiary
undertaking - - (5,569,164)
Share of joint venture's
net loss - WorldAce Investments
Limited 7 (1,828,719) - (304,439)
Share of joint venture's
net loss - Russian BD Holdings
B.V. 8 (157,470) (121,442) (294,103)
Finance revenue 4 1,504,174 27,071 1,550,754
Finance costs - (1,575,918) (1,612,312)
============ ============= -------------
Loss for the period for
continuing operations before
taxation (1,022,964) (2,709,230) (8,376,425)
(MORE TO FOLLOW) Dow Jones Newswires
September 29, 2015 02:01 ET (06:01 GMT)
Income tax expense 5 (392,701) (19,564) (407,960)
Loss for the period attributable
to equity holders of the
Parent (1,415,665) (2,728,794) (8,784,385)
============ ============= =============
Loss per share attributable
to ordinary equity holders
of the Parent
Basic and diluted - US
dollar cent (0.20) (0.39) (1.27)
Interim Condensed Consolidated Statement of Comprehensive Income
For the 6 months ended 30 June 2015
Unaudited Audited
==========================
6 months 6 months
ended ended Year ended
30 June 30 June 31 December
2015 2014 2014
US$ US$ US$
Loss for the period attributable
to equity holders of the
Parent (1,415,665) (2,728,794) (8,784,385)
Other comprehensive income
to be reclassified to profit
or loss in subsequent periods:
Currency translation adjustments
- subsidiaries 19,683 (1,151,236) (764,277)
Share of joint ventures'
other comprehensive income
- foreign exchange translation
differences 909,754 (94,778) (26,480,234)
Recycling of currency translation
reserve on disposal of
subsidiary - - 9,337,907
============ ============
Total comprehensive loss
for the period attributable
to equity holders of the
Parent (486,228) (3,974,808) (26,690,989)
============ ============ =============
Interim Condensed Consolidated Balance Sheet
As at 30 June 2015
Unaudited Audited
=============
30 June 31 December
2015 2014
Note US$ US$
Assets
Non-current Assets
Property, plant and equipment 6 284,217 321,802
Equity-accounted investment
in joint ventures - WorldAce
Investments Limited 7 9,849,169 10,865,156
Equity-accounted investment
in joint ventures - Russian
BD Holdings B.V. 8 279,713 365,178
Financial assets - loans
and receivables 9 47,795,776 46,398,502
58,208,875 57,950,638
============= -------------
Current Assets
Inventories 10 51,644 15,179
Trade and other receivables 11 5,039,796 5,069,944
Cash and cash equivalents 12 2,557,595 3,392,769
-------------
7,649,035 8,477,892
============= -------------
Total Assets 65,857,910 66,428,530
============= =============
Equity and Liabilities
Capital and Reserves
Called up share capital 9,429,182 9,429,182
Share premium account 140,912,898 140,912,898
Share-based payments reserve 6,779,991 6,763,745
Retained loss (67,716,072) (66,300,407)
Currency translation reserve (25,746,849) (26,676,286)
Other reserves 336,000 336,000
Equity attributable to
equity holders of the Parent 63,995,150 64,465,132
============= -------------
Non-current Liabilities
Deferred tax liability 894,615 511,775
894,615 511,775
============= -------------
Current Liabilities
Trade and other payables 13 968,145 1,451,623
968,145 1,451,623
============= -------------
Total Liabilities 1,862,760 1,963,398
Total Equity and Liabilities 65,857,910 66,428,530
============= =============
Interim Condensed Consolidated Statement of Changes in Equity
For the 6 months ended 30 June 2015
Currency
translation
reserve
Share-based relating
Called Share payment Currency to assets
up share premium and other translation held Retained
capital account reserves reserve for sale loss Total
US$ US$ US$ US$ US$ US$ US$
At 1 January
2014 8,561,499 136,762,387 7,020,820 (177,021) (8,592,661) (57,516,022) 86,059,002
---------- ------------ ------------ ------------- ------------ ------------- -------------
Loss for the
year - - - - - (8,784,385) (8,784,385)
Currency
translation
adjustments -
subsidiaries - - - (19,031) (745,246) - (764,277)
Share of joint
ventures'
other
comprehensive
income -
foreign
exchange
translation
differences - - - (26,480,234) - - (26,480,234)
Recycling of
currency
translation
reserve
on disposal
of subsidiary - - - - 9,337,907 - 9,337,907
---------- ------------ ------------ ------------- ------------ ------------- -------------
Total
comprehensive
loss for the
year - - - (26,499,265) 8,592,661 (8,784,385) (26,690,989)
New share
capital
subscribed 867,683 4,308,865 - - - - 5,176,548
Transaction
costs
on issue of
share
capital - (158,354) - - - - (158,354)
Share-based
payment
expense - - 78,925 - - - 78,925
-------------
At 31 December
2014 9,429,182 140,912,898 7,099,745 (26,676,286) - (66,300,407) 64,465,132
========== ============ ============ ============= ============ ============= =============
At 1 January
2015 9,429,182 140,912,898 7,099,745 (26,676,286) - (66,300,407) 64,465,132
========== ============ ============ ============= ============ ============= =============
Loss for the
period - - - - - (1,415,665) (1,415,665)
Currency
translation
adjustments -
subsidiaries - - - 19,683 - - 19,683
Share of joint
ventures'
other
comprehensive
income -
foreign
exchange
translation
differences - - - 909,754 - - 909,754
========== ============ ============ ============= ============ ============= =============
Total
comprehensive
loss for the
period - - - 929,437 - (1,415,665) (486,228)
Share-based
payment
expense - - 16,246 - - - 16,246
At 30 June
2015 9,429,182 140,912,898 7,115,991 (25,746,849) - (67,716,072) 63,995,150
========== ============ ============ ============= ============ ============= =============
Interim Condensed Consolidated Cash Flow Statement
(MORE TO FOLLOW) Dow Jones Newswires
September 29, 2015 02:01 ET (06:01 GMT)
For the 6 months ended 30 June 2015
Unaudited Audited
==========================
6 months 6 months
ended ended Year ended
30 June 30 June 31 December
2015 2014 2014
US$ US$ US$
Operating activities
Loss before taxation (1,022,964) (2,709,230) (8,376,425)
Adjustment to reconcile
loss before tax to net
cash flows
Non-cash
Depreciation 54,575 77,076 126,250
Share of loss in joint
ventures 1,986,189 121,442 598,542
Share-based payment expense/(credit) 16,246 (11,861) 78,925
Loss on disposal of subsidiary - - 5,569,164
Finance revenue 4 (1,504,174) (27,071) (1,550,754)
Finance costs - 1,575,918 1,612,312
Working capital adjustments
Decrease/(increase) in
trade and other receivables 156,081 (64,690) (506,502)
(Increase)/decrease in
inventories (36,465) 70,347 44,199
(Decrease)/increase in
trade and other payables (458,992) 1,093,363 (1,028,136)
Income tax paid (9,861) - (5,354)
Net cash flows (used in)/received
from operating activities (819,365) 125,294 (3,437,779)
-------------
Investing activities
Purchase of oil and gas
properties - 5,406 (200,669)
Advance payments to contractors - (36,434) -
Purchase of property, plant
and equipment (13,312) 31,452 (144,137)
Exploration and evaluation
payments - (1,189,207) (1,187,432)
Loan facilities advanced - - (3,500,000)
Return of loan facilities - - 36,105,575
Decrease in restricted
cash - (1,945,053) 2,054,947
Decrease in cash and cash
equivalents held for sale - - 176,857
Interest received 5,984 7,770 15,310
Net cash (used in)/received
from investing activities (7,328) (3,126,066) 33,320,451
-------------
Financing activities
Proceeds from issue of
share capital - 5,176,548 5,176,548
Transaction costs of issue
of shares - (158,354) (158,354)
Proceeds from loan facilities - 1,500,000 1,500,000
Repayment of loan facilities - (2,600,000) (31,500,000)
Interest paid - (1,116,384) (1,601,285)
Net cash received from/(used
in) financing activities - 2,801,810 (26,583,091)
============ ============ -------------
Net (decrease)/increase
in cash and cash equivalents (826,693) (198,961) 3,299,581
Translation adjustment (8,481) (11,804) (23,643)
Cash and cash equivalents
held for sale - (14,434) -
Cash and cash equivalents
at the beginning of the
year 3,392,769 308,122 116,831
Cash and cash equivalents
at the end of the year 12 2,557,595 82,923 3,392,769
============ ============ =============
Notes to the Interim Condensed Consolidated Financial Statements
For the 6 months ended 30 June 2015
1. Corporate Information
The interim condensed consolidated financial statements of the Group for the six months ended 30 June 2015 were authorised for issue in accordance with a resolution of the Directors on 28 September 2014.
PetroNeft Resources plc ('the Company', or together with its subsidiaries, 'the Group') is a Company incorporated in Ireland. The Company is listed on the Alternative Investment Market ('AIM') of the London Stock Exchange and the Enterprise Securities Market ('ESM') of the Irish Stock Exchange. The address of the registered office and the business address in Ireland is 20 Holles Street, Dublin 2. The Company is domiciled in the Republic of Ireland.
The principal activities of the Group are oil and gas exploration, development and production.
2. Accounting Policies
2.1 Basis of Preparation
The interim condensed consolidated financial statements for the six months ended 30 June 2015 have been prepared in accordance with IAS 34 Interim Financial Reporting.
The interim condensed consolidated financial statements do not include all the information and disclosures required in the annual financial statements, and should be read in conjunction with the Group's annual financial statements as at 31 December 2014 which are available on the Group's website - www.petroneft.com.
The interim condensed consolidated financial statements are presented in US dollars ("US$").
2.2 Significant Accounting Policies
The accounting policies adopted in the preparation of the interim condensed consolidated financial statements are consistent with those followed in the preparation of the Group's annual financial statements for the year ended 31 December 2014.
3. Segment information
At present the Group has one reportable operating segment, which is oil exploration and production through its joint venture undertakings. As a result, there are no further disclosures required in respect of the Group's reporting segment.
The risk and returns of the Group's operations are primarily determined by the nature of the activities that the Group engages in, rather than the geographical location of these operations. This is reflected by the Group's organisational structure and the Group's internal financial reporting systems.
Management monitors and evaluates the operating results for the purpose of making decisions consistently with how it determines operating profit or loss in the consolidated financial statements.
Geographical segments
Although the joint venture undertakings WorldAce Investments Limited and Russian BD Holdings B.V. are domiciled in Cyprus and the Netherlands, the underlying businesses and assets are in Russia. Substantially all of the Group's sales and capital expenditures are in Russia.
Assets are allocated based on where the assets are located:
Unaudited Audited
=========================
30 June 31 December
2015 2014
Non-current assets US$ US$
Russia 58,204,501 57,945,126
Ireland 4,374 5,512
58,208,875 57,950,638
========================= ==================
4. Finance revenue Unaudited Audited
======================
6 months
6 months ended Year ended
ended 30 30 June 31 December
June 2015 2014 2014
US$ US$ US$
Bank interest receivable 5,984 7,772 15,310
Interest receivable
on loans to joint ventures 1,498,190 16,177 1,532,322
Unwinding of discount
on deposit paid for
pipeline usage - 3,122 3,122
1,504,174 27,071 1,550,754
=========== ========= =============
5. Income tax
Unaudited Audited
========================
6 months 6 months Year ended
ended 30 ended 30 31 December
June 2015 June 2014 2014
US$ US$ US$
Current income tax
Current income tax
charge 9,047 1,008 2,859
Total current income
tax 9,047 1,008 2,859
-------------
Deferred tax
(MORE TO FOLLOW) Dow Jones Newswires
September 29, 2015 02:01 ET (06:01 GMT)
Relating to origination
and reversal of temporary
differences 383,654 18,556 405,101
Total deferred tax 383,654 18,556 405,101
=========== =========== -------------
Income tax expense reported
in the Interim Consolidated
Income Statement 392,701 19,564 407,960
=========== =========== =============
Property, Plant and
6. Equipment
Plant
and
machinery
US$
Cost
At 1 January 2014 1,472,972
Additions 148,917
Disposals (43,974)
Translation adjustment (581,327)
----------
At 1 January 2015 996,588
Additions 13,312
Translation adjustment 16,657
At 30 June 2015 1,026,557
Depreciation
At 1 January 2014 1,005,912
Charge for the year 126,250
Disposals (43,974)
Translation adjustment (413,402)
----------
At 1 January 2015 674,786
Charge for the period 54,575
Translation adjustment 12,979
At 30 June 2015 742,340
Net book values
At 30 June 2015 284,217
==========
At 31 December 2014 321,802
==========
7. Equity-accounted Investment in Joint Venture - WorldAce Investments Limited
PetroNeft Resources plc has a 50% interest in WorldAce Investments Limited, a jointly controlled entity which holds 100% of LLC Stimul-T, an entity involved in oil and gas exploration and the registered holder of Licence 61. The interest in this joint venture is accounted for using the equity accounting method. WorldAce Investments Limited became a joint venture with effect from 3 July 2014. WorldAce Investments Limited is incorporated in Cyprus and carries out its activities, through LLC Stimul-T, in Russia.
Share
of net
assets
US$
At 1 January 2014 -
Subsidiary becoming
a joint venture 35,000,000
Elimination of unrealised profit
on intra-Group transactions (22,734)
Retained loss (304,439)
Translation adjustment (23,807,671)
-------------
At 1 January 2015 10,865,156
Elimination of unrealised profit
on intra-Group transactions (25,017)
Retained loss (1,828,719)
Translation adjustment 837,749
At 30 June 2015 9,849,169
=============
Additional financial information in respect of PetroNeft's 50% interest in the equity-accounted joint venture entity is disclosed below:
Unaudited Audited
============
6 months Year ended
ended 30 31 December
June 2015 2014
Continuing operations US$ US$
Revenue 4,924,336 5,845,646
Cost of sales (4,766,524) (5,450,642)
============ -------------
Gross profit 157,812 395,004
Administrative expenses (830,570) (1,027,260)
============ -------------
Operating loss (672,758) (632,256)
Finance revenue 5,834 4,713
Finance costs (1,161,795) (876,896)
============ -------------
Loss for the period
for continuing operations
before taxation (1,828,719) (1,504,439)
Income tax credit - 1,200,000
============
Loss for the period (1,828,719) (304,439)
============ =============
Loss for the period (1,828,719) (304,439)
Other comprehensive
income to be reclassified
to profit or loss
in subsequent periods:
Currency translation
adjustments 837,749 (23,807,671)
============
Total comprehensive
loss for the period (990,970) (24,112,110)
============ =============
7. Equity-accounted Investment in Joint Venture - WorldAce Investments Limited (continued)
The currency translation adjustment results from the change in the Russian Rouble during the period. All Russian Rouble carrying values in Stimul-T, the 100% subsidiary of WorldAce are converted to US Dollars at each period end. The resulting gain or loss is recognised through other comprehensive income and transferred to the currency translation reserve. The Russian Rouble depreciated significantly against the US Dollar during the second half of 2014 moving from RUB34.2:US$1 at 3 July 2014 to RUB56.5:US$1 at 31 December 2014 leading to a currency translation adjustment of US$23.8m in 2014.
Unaudited Audited
============= -------------
PTR Share PTR Share
50% 50%
30 June 31 December
2015 2014
US$ US$
Non-current Assets
Oil and gas properties 35,794,218 27,860,901
Property, plant and
equipment 284,707 285,775
Exploration and evaluation
assets 8,298,601 9,600,431
Assets under construction 5,906,066 -
50,283,592 37,747,107
============= -------------
Current Assets
Inventories 664,170 691,950
Trade and other receivables 1,406,978 1,633,624
Cash and cash equivalents 1,250,696 514,206
3,321,844 2,839,780
=============
Total Assets 53,605,436 40,586,887
============= =============
Non-current Liabilities
Provisions (444,251) (393,153)
Interest-bearing loans
and borrowings (45,230,269) (32,593,955)
(45,674,520) (32,987,108)
============= -------------
Current Liabilities
Trade and other payables (2,960,922) (1,638,815)
(2,960,922) (1,638,815)
============= -------------
Total Liabilities (48,635,442) (34,625,923)
============= =============
Net Assets 4,969,994 5,960,964
============= =============
8. Equity-accounted Investment in Joint Venture - Russian BD Holdings B.V.
PetroNeft Resources plc has a 50% interest in Russian BD Holdings B.V., a jointly controlled entity which holds 100% of LLC Lineynoye, an entity involved in oil and gas exploration and the registered holder of Licence 67. The interest in this joint venture is accounted for using the equity accounting method. Russian BD Holdings B.V. is incorporated in the Netherlands and carries out its activities in Russia.
Share
of net
assets
US$
At 1 January 2014 3,331,844
Retained loss (294,103)
Translation adjustment (2,672,563)
------------------
At 1 January 2015 365,178
Retained loss (157,470)
Translation adjustment 72,005
At 30 June 2015 279,713
==================
8. Equity-accounted Investment in Joint Venture - Russian BD Holdings B.V. (continued)
(MORE TO FOLLOW) Dow Jones Newswires
September 29, 2015 02:01 ET (06:01 GMT)
Additional financial information in respect of PetroNeft's 50% interest in the equity-accounted joint venture entity is disclosed below:
Unaudited Audited
======================
6 months 6 months
ended ended Year ended
30 June 30 June 31 December
2015 2014 2014
US$ US$ US$
Revenue - - -
Cost of sales - - -
Gross profit - - -
Administrative expenses (58,858) (78,188) (143,643)
Exchange gain on intra-Group
loans - 961 -
Operating loss (58,858) (77,227) (143,643)
Finance revenue 274 522 1,743
Finance costs (98,886) (44,737) (152,203)
Loss for the period for
continuing operations before
taxation (157,470) (121,442) (294,103)
Taxation - - -
Loss for the period (157,470) (121,442) (294,103)
========== ========== =============
Loss for the period (157,470) (121,442) (294,103)
Other comprehensive
income to be reclassified
to profit or loss in
subsequent periods:
Currency translation
adjustments 72,005 (94,778) (2,672,563)
Total comprehensive
loss for the period (85,465) (216,220) (2,966,666)
========== ========== =============
Unaudited Audited
============
30 June 31 December
2015 2014
US$ US$
Non-current assets 4,256,359 4,155,338
Current assets 105,821 165,716
Total assets 4,362,180 4,321,054
============ ------------
Non-current liabilities (23,282) (22,810)
Current liabilities (4,059,185) (3,933,066)
Total liabilities (4,082,467) (3,955,876)
============ ------------
Net Assets 279,713 365,178
============ ============
Financial assets -
9. loans and receivables
Unaudited Audited
====================
30 June 31 December
2015 2014
US$ US$
Loans to WorldAce Investments
Limited 47,795,776 46,398,502
47,795,776 46,398,502
==================== ==================
The Company has granted a loan facility to its joint venture undertaking WorldAce Investments Limited of up to US$45 million. This loan facility is US$ denominated and unsecured. Interest currently accrues on the loan at USD LIBOR plus 6.0% but the Company has agreed not to seek payment of interest until 2016 at the earliest. The loan is set to mature on 31 December 2017. As at 31 December 2014 the loan was fully drawn down.
10. Inventories Unaudited Audited
========================
30 June 31 December
2015 2014
US$ US$
Materials 51,644 15,179
51,644 15,179
======================== ======================
11. Trade and other receivables Unaudited Audited
==============================
30 June 31 December
2015 2014
US$ US$
Other receivables 128,581 112,492
Receivable from jointly
controlled entity (Note
14) 4,875,840 4,879,292
Receivable from related
parties - 11,858
Advances to contractors 8,827 1,922
Prepayments 26,548 64,380
5,039,796 5,069,944
============================== =======================
Other receivables are non-interest-bearing and are normally settled on 60-day terms.
Cash and Cash Equivalents
12. and Restricted Cash
Group
Unaudited Audited
=====================
30 June 31 December
2015 2014
US$ US$
Cash at bank and in
hand 2,557,595 3,392,769
2,557,595 3,392,769
===================== ============
Bank deposits earn interest at floating rates based on daily deposit rates. Short-term deposits are made for varying periods of between one day and one month depending on the immediate cash requirements of the Group, and earn interest at the respective short-term deposit rates.
13. Trade and other payables
Unaudited Audited
=========================
30 June 31 December
2015 2014
US$ US$
Trade payables 138,863 306,857
Trade payables to jointly
controlled entity (Note
14) 217,306 53,450
Corporation tax 62,269 60,797
Oil taxes, VAT and employee
taxes 69,061 74,497
Other payables 226,767 137,475
Accruals 253,879 818,547
968,145 1,451,623
========================= =======================
The Directors consider that the carrying amount of trade and other payables approximates their fair value.
Trade and other payables are non-interest-bearing and are normally settled on 60-day terms.
Trade payables and accruals principally comprise amounts outstanding for trade purchases and ongoing costs.
14. Related party disclosures
Transactions with subsidiaries
Transactions between the Group and its subsidiaries, Granite and Dolomite, have been eliminated on consolidation.
Transactions with joint ventures
PetroNeft Resources plc had the following transactions with its joint ventures during the six months ended 30 June 2015 and year ended 31 December 2014:
WorldAce
Russian Investments
BD Holdings Limited
Group BV Group Group
US$ US$
Receivable by PetroNeft
Group at 1 January 2014 644,531 -
Transferred on subsidiary
becoming a joint venture - 81,021,362
Advanced during the year 3,500,000 -
Transactions during the
year 330,967 1,574,116
Interest accrued in the
year 117,120 1,415,202
Loans repaid during the
year (475,000) (35,630,575)
Payments for services
made during the year (206,290) (968,140)
Translation adjustment (28,750) (70,199)
(MORE TO FOLLOW) Dow Jones Newswires
September 29, 2015 02:01 ET (06:01 GMT)
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