Cadogan Energy Solutions Plc Half-year Report

 
TIDMCAD 
 
CADOGAN ENERGY SOLUTIONS PLC 
 
Half Yearly Report for the Six Months ended 30 June 2023 
 
(Unaudited and unreviewed) 
 
Highlights 
 
Cadogan Energy Solutions plc ("Cadogan" or the "Company"), an independent oil & 
gas company, listed on the main market of the London Stock Exchange, aiming to 
be a diversified energy company, is pleased to announce its unaudited results 
for the six months ended 30 June 2023. 
 
  · H1 2023 was another semester with severe challenges caused by the invasion 
of Ukraine by Russia since 24 February 2022. Cadogan could not avoid the 
temporary shutdowns of its production during this period due to the severe 
constraints arisen in the Country. 
  · H1 2023 has been another semester without LTI and TRI. All employees and 
assets have been secured. 
  · In H1 2023, the average production was 298 bpd in (336 bpd in H1 2022), a 
11% decrease versus H1 2022. 
  · Cadogan has signed with PJSC Ukrnafta the extension of the wells Blazhiv-3 
and Blazhiv-Monastyrets-3 lease contracts for a 5-year period (previous 
contracts were for a 3-year period) ahead the expiry period which allowed to 
avoid production stoppage and secure cash flows. 
  · Cadogan completed the acquisition of the 5% of the share interest in Usenco 
Nadra LLC that was not yet owned by the Company and holds now 100% of Usenco 
Nadra LLC. 
  · In H1 2023, the services segment was dedicated totally to supporting the 
production activities in Ukraine. Production entities activities together with 
services entity activities are presented as Exploration and Production segment 
results. 
  · The production revenues decreased by 48% versus the same period in 2022, 
mainly due to a 36% decrease in the average realized oil price and a 11% 
decrease of the production volumes. 
  · In August 2022, Cadogan was informed of the arbitral proceeding award which: 
 
-          rejected Proger's principal claim and declared that the Loan 
Agreement is valid and effective; 
 
-          deemed to qualify the Call Option as a preliminary contract under 
condition, but 
 
-          rejected Proger's claim ex art.2932 Italian Civil Code, stating that 
it is impossible to give an award producing the same effects of a final contract 
ex art.2932 Italian Civil Code, 
 
-          this because of the duties established by the rules of the London 
Regulatory Authority and because of the need, possibly by both parties, to 
comply with the due proceedings before the formalization of the entry of Cadogan 
into the capital of Proger Ingegneria, 
 
-          subordinated the stipulation of the final contract to the precedent 
completion of the proceeding and bureaucratic process as per the British rules, 
stating that, otherwise, 
 
-          there is the obligation on Proger Ingegneria to return the payment 
received under the Loan Agreement, 
 
-          compensated all the expenses of the proceeding. 
 
Proger refused to apply the requirements of the award and thus, Proger must 
reimburse the amount covered by the Loan Agreement plus interest accrued in the 
meantime. 
 
  · The cash position at the period end was $14.2 million (30 June 2022: $14.5 
million). This level of cash is sufficient to sustain on-going operations. 
 
Overall, Cadogan continued operating in an environment with tremendous 
challenges caused by the ongoing war in Ukraine. The Company is currently 
developing new initiatives to continue to improve its performance. 
 
Key performance indicators 
 
During H1 2023, the Group has monitored its performance in conducting its 
business with reference to a number of key performance indicators (`KPIs'): 
 
  · to increase oil production measured on the barrels of oil produced per day 
(`bpd'); 
  · to decrease administrative expenses; 
  · to increase the Group's basic earnings per share; 
  · to maintain no lost time incident; 
  · to grow and geographically diversify the portfolio; and 
  · to secure its staff and operations. 
 
The Group's performance during the first six months of 2023, measured against 
these targets, is set out in the table below, together with the prior year 
performance data. No changes have been made to the sources of data or 
calculations used in the period/year. The positive trend in the HSE performances 
continues with zero incidents. 
 
+-----------------------+----------+------------+------------+----------------+ 
|                       |Unit      |30 June 2023|30 June 2022|31 December 2022| 
+-----------------------+----------+------------+------------+----------------+ 
|                       |          |            |            |                | 
+-----------------------+----------+------------+------------+----------------+ 
|Average production     |Boepd     |298         |336         |323             | 
|(working interest      |          |            |            |                | 
|basis) (a)             |          |            |            |                | 
+-----------------------+----------+------------+------------+----------------+ 
|Administrative expenses|$million  |1.6         |1.6         |3.4             | 
+-----------------------+----------+------------+------------+----------------+ 
|Basic loss per share   |Cent      |(0.1)       |(0.7)       |(0.6)           | 
|(b)                    |          |            |            |                | 
+-----------------------+----------+------------+------------+----------------+ 
|Lost time incident (c) |Incidents |-           |-           |-               | 
+-----------------------+----------+------------+------------+----------------+ 
|Geographical           |New assets|-           |-           |-               | 
|diversification        |          |            |            |                | 
+-----------------------+----------+------------+------------+----------------+ 
 
 a. Average production is calculated as the average daily production during the 
period/year 
 b. Basic loss per ordinary share is calculated by dividing the net loss for the 
year attributable to equity holders of the parent company by the weighted 
average number of ordinary shares during the period 
 c. Lost time incident relate to injuries where an employee/contractor is 
injured and has time off work (IOGP classification) 
 
Enquiries: 
 
+----------------------------+-----------------------+-------------------------+ 
|Cadogan Energy Solutions Plc|                                                 | 
+----------------------------+-----------------------+-------------------------+ 
|Fady Khallouf               |Chief Executive Officer|[e-mail]| 
+----------------------------+-----------------------+-------------------------+ 
|Ben Harber                  |Company Secretary      |[phone]     | 
+----------------------------+-----------------------+-------------------------+ 
 
Introduction 
 
Operations Review 
 
First semester 2023 was another dramatic period for Ukraine. Urban and 
industrial infrastructure were destroyed, in particular, oil refineries as well 
as energy infrastructure have been severely damaged. 
 
This situation has affected Cadogan's activities in Ukraine and impacted the 
Blazhiv wells production with temporary shutdowns, and consequent changes of 
crude oil buyers portfolio due to the volatility in their ability to refine 
available volumes. 
 
All legislative measures related to martial law introduced after the beginning 
of the war in 2022 remain in force. However, the government pursued the efforts 
for the modernization of its oil and gas regulatory framework, in particular by 
enforcing law #4187 which deregulates the subsoil sector, introduces a free 
market of licenses and simplifies access to the land. 
 
In H1 2023, Cadogan employees in Ukraine continued operating in the combined 
(remote/ office) work mode. To date, all our employees are safe. In this 
context, the Group has continued to focus on safely and efficiently operating 
the existing wells, on controlling its costs and on cash preservation while 
continuing to look at opportunities to grow and diversify its portfolio. 
 
Operations 
 
E&P activity remained focused on maintaining and securing its activities for the 
new term and safely and efficiently producing from the existing wells within the 
Blazhiv oil field. During H1 2023, the average gross production rated at 298 
bpd, which is 11% lower than in H1 2022 (336 bpd). There have been several 
production stoppages of the wells during the winter period due to lower volumes 
of crude oil purchases by oil refineries. 
 
Cadogan has signed with PJSC Ukrnafta the extension of Blazhiv-3 and Blazhiv 
-Monastyrets-3 wells lease contracts for a 5-year period. This was possible 
thanks to the solid professional cooperation between the parties during the past 
term and the mutual proactive and constructive approach. 
 
All activities were executed without LTI or TRI[1], with a total of 1,650,000 
manhours since the last incident, which occurred to a sub-contractor in February 
2016. CO2 emissions level in H1 2023 remained at nearly the same level with 
125,08 tons of CO2,e/boe produced compared to 124,99 tons of CO2,e/boe for the 
same reporting period of the last year. The Company is actively working on a 
different technological scenario that will allow to substantially reduce 
emissions to the atmosphere. 
 
In Italy, Exploenergy was notified that its projects (Reno Centese and Corsano) 
were located in compatible areas identified by the PITESAI, the Plan for the 
Sustainable Energy Transition of Suitable Areas. This plan delivers a new 
framework for the possible resumption of exploration and production activities 
on land and at sea. Exploenergy is currently in the qualification process as gas 
operator. 
 
Trading 
 
The Company had no operations for the first half of 2023.Cadogan continues to 
monitor the gas markets in Europe and Ukraine. 
 
Proger 
 
In February 2021, Cadogan notified Proger Managers & Partners Srl ("PMP") that 

according to the Loan Agreement, the Maturity Date occurred on 25 February 2021. 
As the Call Option was not exercised, PMP must fulfill the payment of EUR 
16,430,992, being the reimbursement of the Loan in terms of principal and the 
accumulated interest. PMP is in default since 25 February 2021. End of March 
2021, PMP requested an arbitration to have the Loan Agreement recognised as an 
equity investment contract, which is rejected by Cadogan as the terms of the 
Agreement are clear and include the right to repayment at maturity if the Call 
Option is not exercised. 
 
As at 30 June 2022, Proger Ingegneria holds 96.49 % of Proger Spa after the exit 
of SIMEST and the purchase by Proger Ingegneria of its stake in Proger Spa. In 
August 2022, Cadogan was informed of the award in the arbitration proceeding 
which: 
 
-                rejected Proger's principal claim and declared that the Loan 
Agreement is valid and effective, 
 
-                deemed to qualify the Call Option as a preliminary contract 
under condition, but 
 
-                rejected Proger's claim ex art.2932 Italian Civil Code, stating 
that it is impossible to give an award producing the same effects of a final 
contract ex art.2932 Italian Civil Code, 
 
-                this because of the duties established by the rules of the 
London Regulatory Authority and because of the need, possibly by both parties, 
to comply with the due proceedings before the formalization of the entry of 
Cadogan into the capital of Proger Ingegneria, 
 
-                subordinated the stipulation of the final contract to the 
precedent completion of the proceeding and bureaucratic process as per the 
British rules, stating that, otherwise, 
 
-                there is the obligation on Proger Ingegneria to return the 
payment received under the Loan Agreement, 
 
-                compensated all the expenses of the proceeding. 
 
Proger refused to apply the requirements of the award and thus, Proger must 
reimburse the amount covered by the Loan Agreement plus interest accrued in the 
meantime. Cadogan is taking the necessary legal actions to recover these 
amounts. 
 
Financial position 
 
Cash at 30 June 2023 was $14.2 million ($14.5 million at 30 June 2022). The 
Group continually monitors its exposure to currency risk. It maintains a 
portfolio of cash mainly in US Dollars ("USD") and EURO held primarily in the 
UK. 
 
The Directors believe that the capital available at the date of this report is 
sufficient for the Group to continue its operations for the foreseeable future. 
 
In H1 2023, the Group held working interests in an oil production licence in the 
West of Ukraine. It is operated by the Group and is located in the prolific 
Carpathian basin, close to the Ukrainian oil & gas distribution infrastructure. 
 
The Group's primary focus during the period continued to be on cost optimisation 
and enhancement of current production, through the existing well stock and new 
drilling. 
 
Summary of the Group's licences (as of 30 June 2023) 
Working       Licence  Expiry         Licence type 
 
interest (%) 
100           Blazhiv  November 2039  Production 
 
Below we provide an update to the full Operations Review contained in 2022 
Annual Report published on 28 April 2023. 
 
Blazhiv licence 
 
Through the reporting period the Company has been working to safely and 
efficiently producing from the existing wells located in the Blazhiv licence 
area. At the end of the reporting period, the average gross production rated at 
298 bpd vs 336 bpd in H1 2022. There have been several production stoppages of 
the wells during the winter period due to the reduction of crude oil consumption 
by oil refineries caused by Russian air strikes or by power outage due to 
similar strikes on electricity infrastructure. 
 
Cadogan has signed the extension of Blazhiv-3 and Blazhiv-Monastyrets-3 wells 
lease contracts for a 5-year period with PJSC Ukrnafta ahead the expiry period 
which allowed to avoid production shutdown. This was possible thanks to the 
solid professional cooperation between the parties during the past term and the 
proactive and constructive approach of both. 
 
Service Company activities 
 
In H1 2023, Astro Service LLC, focused its activities on serving intra-group 
operational needs in wells' work-over/ re-entry operations, wells' survey as 
well as field on-site activities. Production and service activities will be 
presented solely as Exploration and Production segment result. 
 
Financial Review 
 
Overview 
 
Income statement 
 
In H1 2023, revenues decreased to $2.4 million (H1 2022: $4.6 million) due to 
the decrease of the realised price by 36% and the decrease in the produced 
volumes of oil by 12%. 
 
Trading business had no activities during the first half of 2023. 
 
The cost of sales of the production segment consists of $1 million of production 
royalties ($1.9 million), $0.7 million of operating costs ($0.7 million), $0.3 
million of depreciation and depletion of producing wells ($0.4 million), and 
$0.07 million of direct staff costs for production ($0.15 million). 
 
Half year gross profit from production activities decreased to $0.32 million (30 
June 2022: increased to $1.5 million), driven by decrease in production and 
lower oil prices. 
 
The Group recorded a $0.7 million interest on Proger Loan. Due to expected delay 
in the loan reimbursement, the Company recognized additional provision of $350 
thousand. Please refer to note 11 for details. 
 
Other administrative expenses were kept under control at $1.6 million (30 June 
2022: $1.6 million). They comprise other staff costs, professional fees and 
expenses, Directors' remuneration and depreciation charges on non-producing 
property. 
 
Balance sheet 
 
At 30 June 2023, the cash position of $14.2 million (30 June 2022: $14.5 
million) increased compared to the $13.9 million as at 31 December 2022. 
 
The Property, Plant and Equipment ("PP&E") balance of $6.4 million at 30 June 
2023 (30 June 2022: $8.6 million, 31 December 2022: $6.6 million) includes the 
development and production assets on the Blazhyvska licence and other PP&E of 
the Group. 
 
Trade and other receivables of $0.2 million (30 June 2022: $0.4 million, 31 
December 2022: $0.3 million) includes recoverable VAT of $0.1 million (30 June 
2022: $0.1 million, 31 December 2022: $0.07 million), $0.1 million of other 
receivables and prepayments (30 June 2022: $0.3 million, 31 December 2022: $0.2 
million). 
 
The $1.9 million of trade and other payables as of 30 June 2023 (30 June 2022: 
$1.3 million, 31 December 2022: $1.4 million) represent $1.5 million (30 June 
2022: $0.9 million, 31 December 2022: $0.8 million) of other creditors and $0.4 
million of accruals (30 June 2022: $0.4 million, 31 December 2022: $0.6 
million). 
 
Cash flow statement 
 
The Consolidated Cash Flow Statement shows positive cash-flow from operating 
activities of $0.1 thousand (30 June 2022: neutral, 31 December 2022: negative 
$0.9 thousand). Cashflow, before movements in working capital, shows an outflow 
of $0.9 thousand (30 June 2022: inflow $0.3 thousand, 31 December 2022: inflow 
$0.2 million). 
 
Group capital expenditure was $0.1 million: investment into subsidiaries 
(purchase of the non-controlled stake in Usenco-Nadra) and investment in 
Property, Plant and Equipment which related to the Blazhyvska licence. 
 
Commitments 
 
There has been no material change in the commitments and contingencies reported 
as at 31 December 2022 (refer to page 80 of the Annual Report). 
 
Treasury 
 
The Group continually monitors its exposure to currency risk. It maintains a 
portfolio of cash mainly in US dollars ("USD") and Euro held primarily in the 
UK. Production revenues from the sale of hydrocarbons are received in the local 
currency in Ukraine, however, the hydrocarbon prices are linked to the USD 
denominated gas and oil prices. The martial law in Ukraine forbids the transfer 
of cash outside of Ukraine. 
 
The cash held in the Country must be held in the local currency (Hryvnia). 
 
Going concern 
 
The Directors have a reasonable expectation that the Company and the Group have 
adequate resources to continue in operational existence for the foreseeable 
future. Accordingly, they continue to adopt the going concern basis in preparing 
the Interim Financial Statements. For further details, refer to the detailed 
presentation of the assumptions outlined in note 2(a) of the Interim Financial 
Statements. 
 
Cautionary Statement 
 
The business review and certain other sections of this Half Yearly Report 
contain forward looking statements that have been made by the Directors in good 
faith based on the information available to them up to the time of their 
approval of this report. However they should be treated with caution due to 
inherent uncertainties, including both economic and business risk factors, 
underlying any such forward-looking information and no statement should be 
construed as a profit forecast. 
 
Risk and Uncertainties 
 
There are a number of potential risks and uncertainties inherent in the oil and 
gas sector which could have a material impact on the long-term performance of 
the Group and which could cause the actual results to differ materially from 
expected and historical results. The Company has taken reasonable steps to 
mitigate these where possible. Full details are disclosed on pages 10 to 13 of 
the 2022 Annual Financial Report. There have been no changes to the risk profile 
during the first half of the year. The risks and uncertainties are summarised 
below. 
 
War risk 
 
Operational risks 
 
  · Health, safety, and environment 
  · COVID-19 
  · Climate change 
  · Drilling and work-over operations 
  · Production and maintenance 
 
Subsurface risks 
 
Financial risks 
 
  · Changes in economic environment 
  · Counterparty 
  · Default on the Proger loan repayment 
  · Commodity price 
 
Country risk 
 
  · Regulatory and licence issues 
  · Emerging market 
 
Other risks 
 
  · Risk of losing key staff members 

  · Risk of entry into new countries 
  · Risk of delays in projects related to dialogue with local communities 
 
Director's Responsibility Statement 
 
We confirm that to the best of our knowledge: 
 
(a)the Interim Financial Statements have been prepared in accordance with the UK 
-adopted IAS 34 `Interim Financial Reporting'; 
 
(b)the interim management report includes a fair review of the information 
required by DTR 4.2.7R (indication of important events during the first six 
months and description of principal risks and uncertainties for the remaining 
six months of the year); 
 
(c)the interim management report includes a fair review of the information 
required by DTR 4.2.8R  (disclosure of related parties' transactions and changes 
therein); and 
 
(d)the condensed set of financial statements, which has been prepared in 
accordance with the applicable set of accounting standards, gives a true and 
fair view of the assets, liabilities, financial position and profit or loss of 
the issuer, or the undertakings included in the consolidation as a whole as 
required by DTR 4.2.4R. 
 
This Half Yearly Report consisting of pages 1 to 21 has been approved by the 
Board and signed on its behalf by: 
 
Fady Khallouf 
 
Chief Executive Officer 
 
8 September 2023 
 
Consolidated Income Statement 
Six months ended 30 June 2023 
 
                            Six months ended 30 June  Year ended 
 
                                                      31 December 
                            2023         2022         2022 
 
                            $'000        $'000        $'000 
                     Notes  (Unaudited)  (Unaudited)  (Audited) 
CONTINUING 
OPERATIONS 
Revenue              3      2,414        4,635        8.472 
Cost of sales        3      (2,099)      (3,142)      (5.553) 
Gross profit                315          1,493        2.919 
 
Administrative              (1,550)      (1,587)      (3.441) 
expenses 
Reversal of                 -            -            20 
impairment of other 
assets 
Impairment of gas           (70)         -            (269) 
and oil assets 
Change in provision         -            (600)        - 
for loan provided 
Impairment of other         -            -            (27) 
assets 
Net foreign                 290          (1,633)      (1.131) 
exchange 
gains/(losses) 
Other operating             63           (26)         (3) 
income/(losses),net 
Operating                   (952)        (2,353)      (1.932) 
(loss)/profit 
 
Finance income       4      779          607          372 
(Loss)/profit               (173)        (1,746)      (1.560) 
before tax 
 
Tax                         -            -            - 
(expense)/benefit 
(Loss)/profit for           (173)        (1,746)      (1.560) 
the period/year 
 
Attributable to: 
Owners of the        5      172          (1,747)      (1.562) 
Company 
Non-controlling             (1)          1            (2) 
interest 
                            (173)        (1,746)      (1.560) 
 
(Loss)/profit per           Cents        Cents        Cents 
Ordinary share 
Basic and diluted    5      (0.1)        (0.7)        (0.6) 
 
Consolidated Statement of Comprehensive Income 
Six months ended 30 June 2023 
 
                                  Six months ended 30 June  Year ended 
 
                                                            31 December 
                                  2023         2022         2022 
 
                                  $'000        $'000        $'000 
                                  (Unaudited)  (Unaudited)  (Audited) 
(Loss)/profit for the             (173)        (1,746)      (1,560) 
period/year 
Other comprehensive 
profit/(loss) 
Items that may be reclassified 
subsequently to profit or loss 
Unrealised currency               41           (986)        (3,287) 
translation differences 
Other comprehensive               41           (986)        (3,287) 
profit/(loss) 
Total comprehensive               (132)        (2,732)      (4,847) 
(loss)/profit for the 
period/year 
 
Attributable to: 
Owners of the Company             (131)        (2,733)      (4,849) 
Non-controlling interest          (1)          1            (2) 
                                  (132)        (2,732)      (4,847) 
 
Consolidated Statement of Financial Position 
Six months ended 30June 2023 
 
                     Six months                Year 
                     ended 30                  ended 
                     June 
                                               31 
                                               December 
                     2023         2022         2022 
 
                     $'000        $'000        $'000 
    Notes            (Unaudited)  (Unaudited)  (Audited) 
  ASSETS 
  Non-current 
  assets 
  Intangible           -          -            - 
  exploration 
  and 
  evaluation 
  assets 
  Property,     6      6,407      8,616        6,633 
  plant and 
  equipment 
  Right-of-use         61         139          108 
  assets 
  Deferred tax         318        409          319 
  asset 
                       6,786      9,164        7,060 
  Current 
  assets 
  Inventories   7      141        165          295 
  Trade and     8      233        373          318 
  other 
  receivables 
  Loan          11     16,441     15,327       15,825 
  provided 
  Cash and             14,195     14,518       13,934 
  cash 
  equivalents 
                       31,010     30,383       30,372 
  Total assets         37,796     39,547       37,432 
 
  LIABILITIES 
  Non-current 
  liabilities 
  Long-term            -          (59)         (28) 
  lease 
  liability 
  Provisions           (286)      (380)        (261) 
                       (286)      (439)        (289) 
  Current 
  liabilities 
  Trade and     9      (1,938)    (1,352)      (1,401) 
  other 
  payables 
  Short-term           (65)       (114)        (79) 
  lease 
  liability 
  Current              (135)                   (136) 
  provisions 
                       (2,138)    (1,466)      (1,616) 
  Total                (2,424)    (1,905)      (1,905) 
  liabilities 
 
  Net assets           35,372     37,642       35,527 
 
  EQUITY 
  Share         12     13,832     13,832       13,832 
  capital 
  Share                514        514          514 
  premium 
  Retained             184,372    184,146      184,331 
  earnings 
  Cumulative           (164,935)  (162,675)    (164,976) 
  translation 
  reserves 
  Other                1,589      1,589        1,589 
  reserves 
  Equity               35,372     37,406       35,290 
  attributable 
  to equity 
  holders of 
  the parent 
  Non                  -          236          237 
  -controlling 
  interest 
  Total equity         35,372     37,642       35,527 
 
 
 
Consolidated Statement of Cash Flows 
Six months ended 30 June 2023 
 
                  Six months                Year 
                  ended 30                  ended 
                  June 
                                            31 
                                            December 
                  2023         2022         2022 
 
                  $'000        $'000        $'000 
                  (Unaudited)  (Unaudited)  (Audited) 
  Operating         (952)        (2,353)      (1,932) 
  loss 
  Adjustments 
  for: 
  Depreciation      286          434          764 
  of property, 
  plant and 
  equipment 
  Impairment        -            -            (20) 
  of 
  inventories 
  Change in         -            600          - 
  provision 
  for loan 
  provided 
  Impairment/(R     -            -            11 
  eversal of 
  impairment) 
  of VAT 
  recoverable 
  Impairment        70           -            269 
  of oil and 
  gas assets 
  Impairment        -            -            16 
  of 
  receivables 
  Effect of         (290)        1,633        1,131 
  foreign 
  exchange 
  rate changes 
  Operating         (886)        314          239 
  cash flows 
  before 
  movements in 
  working 
  capital 
  Decrease/(Inc     153          (1)          (155) 
  rease) in 
  inventories 
  Decrease          145          (166)        (946) 
  /(Increase) 
  in 
  receivables 
  Increase/(Dec     496          (176)        (197) 
  rease) in 
  payables and 
  provisions 
  Cash from         (92)         (29)         (1,059) 
  operations 
  Interest          199          28           185 
  received 
  Net cash          107          (1)          (874) 
  inflow/(outfl 
  ow) from 
  operating 
  activities 
 
  Investing 
  activities 
  Purchases of    (33)           (75)         (93) 
  property, 
  plant and 
  equipment 
  Purchase of     (24)           -            - 
  shares in 
  subsidiaries 
  from 
  minority 
  shareholders 
  Interest        176            -            97 
  received 
  Net cash        119            (75)         4 
  used in 
  investing 
  activities 
 
  Financing 
  activities 
  Net cash        -              -            - 
  from 
  financing 
  activities 
 
  Net increase    226            (76)         (870) 
  (decrease) 
  in cash and 
  cash 
  equivalents 
  Effect of       35             (417)        (207) 
  foreign 
  exchange 
  rate changes 
  Cash and        13,934         15,011       15,011 
  cash 
  equivalents 
  at beginning 
  of 
  period/year 
  Cash and        14,195         14,518       13,934 
  cash 
  equivalents 
  at end of 
  period/year 
 
Consolidated Statement of Changes in Equity 
Six months ended 30 June 2023 
 
               Share    Share    Retained  Cumulative   Other     Equity 
Non           Total 
               capital  premium  earnings  translation  reserves  attributable 
-controlling 
                        account            reserves               to 
                                                                  owners of 
                                                                  the Company 
interest 
               $'000    $'000    $'000     $'000        $'000     $'000 
$'000         $'000 

As at 1        13,832   514      185,893   (161,689)    1,589     40,139 
235           40,374 
January 2022 
Net loss for   -        -        (1,747)   -            -         (1,747) 
1             (1,746) 
the 
period 
Other          -        -        -         (986)        -         (986) 
-             (986) 
comprehensive 
loss 
Total          -        -        (1,747)   (986)        -         (2,733) 
1             (2,732) 
comprehensive 
loss for the 
year 
As at 30 June  13,832   514      184,146   (162,675)    1,589     37,406 
236           37,642 
2022 
Net profit     -        -        185       -            -         185 
1             186 
for the 
period 
Other          -        -        -         (2,301)      -         (2,301) 
-             (2,301) 
comprehensive 
loss 
Total          -        -        185       (2,301)      -         (2,116) 
1             (2,115) 
comprehensive 
loss for the 
year 
As at 31       13,832   514      184,331   (164,976)    1,589     35,290 
237           35,527 
December 
2022 
Net loss for   -        -        (172)     -            -         (172) 
(1)           (173) 
the 
period 
Other          -        -        -         41           -         41 
-             41 
comprehensive 
profit 
Total          -        -        (172)     41           -         (131) 
(1)           (132) 
comprehensive 
loss for the 
year 
Acquisition                      213                              213 
(236)         (23) 
of non 
-controlling 
interests 
As at 30 June  13,832   514      184,372   (164,935)    1,589     35,372 
-             35,372 
2023 
 
Notes to the Condensed Financial Statements 
Six months ended 30 June 2023 
 
 1. General information 
 
Cadogan Energy Solutions plc (the `Company', together with its subsidiaries the 
`Group'), is incorporated in England and Wales under the Companies Act. The 
address of the registered office is 6th Floor, 60 Gracechurch Street, London 
EC3V 0HR. The nature of the Group's operations and its principal activities are 
set out in the Operations Review on pages 7 to 8 and the Financial Review on 
pages 8 to 9. 
 
This Half Yearly Report has not been audited or reviewed in accordance with the 
Auditing Practices Board guidance on `Review of Interim Financial 
Information'. 
 
A copy of this Half Yearly Report has been published and may be found on the 
Company's website at https://www.cadoganenergysolutions.com. 
 
 2. Basis of preparation 
 
The annual financial statements of the Group are prepared in accordance with 
international accounting standards in conformity with the requirements of the 
Companies Act 2006 and in accordance with international financial reporting 
standards adopted pursuant to Regulation (EC) No 1606/2002 as it applies in the 
European Union. On 31 December 2020, IFRS as adopted by the European Union at 
that date was brought into UK law and became UK-adopted international accounting 
standards, with future changes being subject to endorsement by the UK 
Endorsement Board. The Group transitioned to UK-adopted international accounting 
standards in its consolidated financial statements on 1 January 2021. There was 
no impact or changes in accounting policies from the transition. These Condensed 
Financial Statements have been prepared in accordance with the UK-adopted IAS 34 
Interim Financial Reporting. 
 
The same accounting policies and methods of computation are followed in the 
condensed financial statements as were followed in the most recent annual 
financial statements of the Group except as noted, which were included in the 
Annual Report issued on 27 April 2023. 
 
The Group has not early adopted any amendment, standard or interpretation that 
has been issued but is not yet effective. It is expected that where applicable, 
these standards and amendments will be adopted on each respective effective 
date. 
 
This consolidated interim financial information does not constitute accounts 
within the meaning of section 434 and of the Companies Act 2006. Statutory 
accounts for the year ended 31 December 2022 were approved by the Board of 
Directors on 27 April 2023 and delivered to the Registrar of Companies. The 
report of the auditors on those accounts was qualified as the auditors were 
unable to obtain sufficient and appropriate evidence to conclude as to whether 
the fair value of the Proger loan of $15.8 million was materially accurate. 
 
(a)           Going concern 
 
The Directors have continued to use the going concern basis in preparing these 
condensed financial statements. The Group's business activities, together with 
the factors likely to affect future development, performance and position are 
set out in the Operations Review. The financial position of the Group, its cash 
flow and liquidity position are described in the Financial Review. 
 
The Group's cash balance at 30 June 2023 was $14.2 million (31 December 2022: 
$13.9 million). 
 
The Directors' have carried out a robust assessment of the principal risks 
facing the Group. 
 
The Group's forecasts and projections, taking into account reasonably possible 
changes in trading activities, operational performance, flow rates for 
commercial production and the price of hydrocarbons sold to Ukrainian customers, 
show that there are reasonable expectations that the Group will be able to 
operate on funds currently held and those generated internally, for the 
foreseeable future. 
 
Notwithstanding the Group's current financial performance and position, the 
Board are cognisant of the actual impacts of the war situation in Ukraine. The 
Board has considered possible reverse stress case scenarios for the impact on 
the Group's operations, financial position and forecasts.  Whilst the potential 
future impacts of the invasion of Ukraine by Russia are unknown, the Board has 
considered operational disruption that may be caused by the factors such as a) 
restrictions applied by governments, illness amongst our workforce and 
disruption to supply chain and sales channels; b) market volatility in respect 
of commodity prices associated with military and geopolitical factors. 
 
In addition to sensitivities that reflect future expectations regarding country, 
commodity price and currency risks that the Group may encounter reverse stress 
tests have been run to reflect possible negative effects of war in Ukraine. The 
Group's forecasts demonstrate that owing to its cash resources the Group is able 
to meet its operating cash flow requirements and commitments whilst maintaining 
significant liquidity for a period of at least the next 12 months allowing for 
sustained reductions in commodity prices and extended and severe disruption to 
operations should such a scenario occur. 
 
After making enquiries and considering the uncertainties described above, the 
Directors have a reasonable expectation that the Company and the Group have 
adequate resources to continue in operational existence for the foreseeable 
future and consider the going concern basis of accounting to be appropriate and, 
thus, they continue to adopt the going concern basis of accounting in preparing 
the annual financial statements. 
 
(b)          Foreign currencies 
 
The individual financial statements of each Group company are presented in the 
currency of the primary economic environment in which it operates (its 
functional currency). The functional currency of the Company is US dollar. For 
the purpose of the consolidated financial statements, the results and financial 
position of each Group company are expressed in US dollars, which is the 
presentation currency for the consolidated financial statements. 
 
The relevant exchange rates used were as follows: 
 
1 £ = xUS$       Six months ended 30 June  Year ended 
 
                                           31 Dec 2022 
                 2023     2022 
  Closing rate   1.2663   1.2160           1.0817 
  Average rate   1.2336   1.2877           1.2372 
 
1 US$ = xUAH     Six months ended 30 June  Year ended 
 
                                           31 Dec 2022 
                 2023     2022 
  Closing rate   37.2401  29.87219         37.0663 
  Average rate   37.1364  29.45866         32.45697 
 
  1 Euro = xUS$  Six months ended 30 June  Year ended 
                 2023     2022             31 Dec 2022 
  Closing rate   1.0886   1.0451           1.0709 
  Average rate   1.0809   1.0857           1.0539 
 
(c)           Dividend 
 
The Directors do not recommend the payment of a dividend for the period (30 June 
2023: $nil; 31 December 2022: $nil). 
 
(d) Critical accounting judgments and estimates 
 
Impairment indicator assessment for E&E assets 
 
Where there are indications of impairment, the E&E assets concerned are tested 
for impairment. Where the E&E assets concerned fall within the scope of an 
established full cost pool, which are not larger than an operating segment, they 
are tested for impairment together with all development and production assets 
associated with that cost pool, as a single cash generating unit. 
 
The aggregate carrying value of the relevant assets is compared against the 
expected recoverable amount of the pool, generally by reference to the present 
value of the future net cash flows expected to be derived from production of 
commercial reserves from that pool. Where the assets fall into an area that does 
not have an established pool or if there are no producing assets to cover the 
unsuccessful exploration and evaluation costs, those assets would fail the 
impairment test and be written off to the income statement in full. 
 
Impairment losses are recognized in the income statement and are separately 
disclosed. 
 
Impairment of PP&E 
 
Management assesses the development and production assets for impairment 
indicators and performs an impairment test if indicators of impairment are 
identified. Management performed an impairment assessment using a value in use 
discounted cash flow model which required estimates including forecast oil 
prices, reserves and production, costs and discount rates. 
 
Recoverability and measurement of VAT 
 

Judgment is required in assessing the recoverability of VAT assets and the 
extent to which historical impairment provisions remain appropriate, 
particularly noting the recent recoveries against historically impaired VAT. In 
forming this assessment, the Group consider the nature and age of the VAT, the 
likelihood of eligible future supplies to VAT, the pattern of recoveries and 
risks and uncertainties associated with the operating environment. 
 
Loan provided 
 
In February 2019, the Group advanced a Euro 13,385,000 loan to Proger Managers & 
Partners Srl ("PMP"), a privately owned Italian company whose only interest is a 
72.92% participation in Proger Ingegneria Srl ("Proger Ingegneria"), a privately 
owned company which held a 75.95% participating interest in Proger Spa 
("Proger") at 31 December 2020. The loan carries an entitlement to interest at a 
rate of 5.5% per year, payable at maturity (which is 24 months after the 
execution date (February 2019) and assuming that the call option described below 
is not exercised). The principal of the loan is secured by a pledge over PMP's 
current participating interest in Proger Ingegneria Srl, up to a maximum 
guaranteed amount of Euro 13,385,000. 
 
Through the Call Option Agreement, the Group was granted a call option to 
acquire, at its sole discretion, 33% of participating interest in Proger 
Ingegneria; the exercise of the option would have given Cadogan, through CPHBV, 
an indirect 25% interest in Proger at 31 December 2020. The call option was 
granted at no additional cost and could be exercised at any time between the 6th 
(sixth) and 24th (twenty-fourth) months following the execution date of the loan 
agreement and subject to Cadogan shareholders having approved the exercise of 
the call option as explained further below. Should CPHBV exercise the call 
option, the price for the purchase of the 33% participating interest in Proger 
Ingegneria shall be paid by setting off the corresponding amount due by PMP to 
CPHBV, by way of reimbursement of the principal, pursuant to the Loan Agreement. 
If the Call Option is exercised, then the obligation on PMP to pay interest is 
extinguished. 
 
Management considered the extent to which the Option and rights to 
representation on the Board of Proger Ingegneria and Proger meant significant 
influence existed.  The requirement to obtain shareholders' approval for any 
exercise of the option was considered to represent a substantive condition such 
that the option was not `currently exercisable' under IFRS at 31 December 2020. 
In consequence, the potential voting rights associated with any subsequent 
exercise of the Option were not considered to contribute to significant 
influence over the investee. 
 
In 2019 and 2020, under the Group's accounting policies, the instrument was held 
at fair value through profit and loss and determination of fair value required 
assessment of both key investee specific information regarding financial 
performance and prospects and market information. The determination of fair 
value was made at 31 December 2020 based on facts and circumstances at that 
date, notwithstanding that the borrower failed to repay the loan at maturity in 
2021. 
 
The Group's original investment decision involved assessment of Proger Spa 
business plans and analysis with professional advisers including valuations 
performed using the income method (discounted cash flows) and market approach 
using both the precedent transactions and trading multiples methods. 
 
Unfortunately, Proger refused to provide Cadogan information regarding its 2020 
financial performance or updated forecasts to undertake a detailed fair value 
assessment using the income method or market approach at 31 December 2020. As a 
consequence, management assessed the fair value of the instrument based on the 
terms of the agreement, including the pledge over shares, together with 
financial information in respect of prior periods and determined that $16.8 
million represented the best estimate of fair value, being equal to anticipated 
receipts and timing thereof discounted at an estimated market rate of interest 
of 7.8%.  In forming its assessment at 31 December 2020, management particularly 
considered the impact of any claim under the pledge and further litigation 
options on the underlying investee business and shareholders and resulting 
incentive that created for the borrower to ultimately meet the contractual 
payment obligation. Management further considered information relevant to Proger 
business and PMP's ability to pay, noting the absence of 2020 financial 
information. However, the absence of information regarding Proger's 2020 
financial performance and prospects represented a significant limitation on the 
fair value exercise and, as a result, if received, the fair value could be 
materially higher or lower than this value. 
 
Since the Call Option was not exercised before the Maturity Date and the asset 
is held within a business model whose objective is to hold assets in order to 
collect contractual cash flows, the Loan provided was reclassified from 
`Financial assets at fair value through profit and loss' to `Financial assets at 
amortized cost' at the value carried at the Company balance at the date of the 
Call Option expiry (Note 11). 
 
End of March 2021, PMP requested an arbitration to have the Loan Agreement 
recognised as an equity investment contract. 
 
In August 2022, Cadogan was informed of the award in the arbitration proceeding 
which: 
 
-                rejected Proger's principal claim and declared that the Loan 
Agreement is valid and effective, 
 
-                deemed to qualify the Call Option as a preliminary contract 
under condition, but 
 
-                rejected Proger's claim ex art.2932 Italian Civil Code, stating 
that it is impossible to give an award producing the same effects of a final 
contract ex art.2932 Italian Civil Code, 
 
-                this because of the duties established by the rules of the 
London Regulatory Authority and because of the need, possibly by both parties, 
to comply with the due proceedings before the formalization of the entry of 
Cadogan into the capital of Proger Ingegneria, 
 
-                subordinated the stipulation of the final contract to the 
precedent completion of the proceeding and bureaucratic process as per the 
British rules, stating that, otherwise, 
 
-                there is the obligation on Proger Ingegneria to return the 
payment received under the Loan Agreement, 
 
-                compensated all the expenses of the proceeding. 
 
Proger refused to apply the requirements of the award and thus, Proger must 
reimburse the amount covered by the Loan Agreement plus interest accrued in the 
meantime. Cadogan is taking the necessary legal actions to recover these 
amounts. 
 
In forming its assessment at 30 June 2023, management considered the arbitration 
award and the impact of an additional delay in the reimbursement of the Proger 
Loan. 
 
 3. Segment information 
 
Segment information is presented on the basis of management's perspective and 
relates to the parts of the Group that are defined as operating segments. 
Operating segments are identified on the basis of internal assessment provided 
to the Group's chief operating decision maker ("CODM"). The Group has identified 
its executive management team as its CODM and the internal assessment used by 
the top management team to oversee operations and make decisions on allocating 
resources serve as the basis of information presented. 
 
Segment information is analysed on the basis of the type of activity, products 
sold, or services provided. The majority of the Group's operations are located 
within Ukraine. Segment information is analysed on the basis of the types of 
goods supplied by the Group's operating divisions. 
 
The Group's reportable segments under IFRS 8 are therefore as follows: 
 
Exploration and Production 
 
  · E&P activities on the production licences for natural gas, oil and 
condensate 
 
Service 
 
  · Drilling services to exploration and production companies 
  · Construction services to exploration and production companies 
 
Trading 
 
  · Import of natural gas from European countries 
  · Local purchase and sales of natural gas operations with physical delivery of 
natural gas 
 
The accounting policies of the reportable segments are the same as the Group's 
accounting policies. Sales between segments are carried out at market prices. 
The segment result represents profit under IFRS before unallocated corporate 
expenses. Unallocated corporate expenses include management and Board 
remuneration and expenses incurred in respect of the maintenance of Kiev office 
premises. This is the measure reported to the CODM for the purposes of resource 
allocation and assessment of segment performance. 
 
The Group does not present information on segment assets and liabilities as the 
CODM does not review such information for decision-making purposes. 
 
As at 30 June 2023 and for the six months then ended the Group's segmental 
information was as follows: 
 
                      Exploration and Production  Trading  Consolidated 
                      $'000                       $'000    $'000 
Sales of              2,410                       -        2,410 
hydrocarbons 
Other revenue         4                           -        4 
Sales between         -                           -        - 
segments 
Total revenue         2,414                       -        2,414 
Other cost of sales   (2,097)                     (2)      (2,099) 
Other administrative  (204)                       (22)     (226) 
expenses 
Impairment of oil &   (70)                                 (70) 
gas 
Other operating       63                          -        63 
costs 
Finance               199                                  199 
income/costs, net 
Segment results       305                         (24)     281 
Unallocated other                                          (1,324) 
administrative 
expenses 

Other finance                                              580 
income, net 
Net foreign exchange                                       290 
gains 
Loss before tax                                            (173) 
 
As at 30 June 2022 and for the six months then ended the Group's segmental 
information was as follows: 
 
                      Exploration and Production  Trading  Consolidated 
                      $'000                       $'000    $'000 
Sales of              4,632                       -        4,632 
hydrocarbons 
Other revenue         3                           -        3 
Total revenue         4,635                                4,635 
Other cost of sales   (3,142)                     -        (3,142) 
Other administrative  (226)                       (28)     (254) 
expenses 
Other operating       (26)                        -        (26) 
costs 
Finance               -                           28       28 
income/costs, net 
Segment results       1,241                       -        1,241 
Unallocated other                                          (1,333) 
administrative 
expenses 
Net foreign exchange                                       (1,633) 
gains 
Other income/loss,                                         (21) 
net 
Loss before tax                                            (1,746) 
 
 4. Finance income/(costs), net 
 
 
 
                           Six months ended 30 June  Year ended 
 
                                                     31 December 
                           2023   2022               2022 
                           $'000  $'000              $'000 
Interest expense on lease  (5)    (9)                (18) 
 
Total interest expenses    (5)    (9)                (18) 
on financial liabilities 
 
Interest income on cash    375    28                 282 
deposit 
Change in provision        -      -                  93 
 
Total interest income on   375    28                 375 
financial assets 
 
Interest on loan           354    614                38 
Unwinding of discount on   55     (26)               (23) 
decommissioning provision 
                           779    607                372 
 
 5. (Loss)/profit per ordinary share 
 
(Loss)/profit per ordinary share is calculated by dividing the net (loss)/profit 
for the period/year attributable to Ordinary equity holders of the parent by the 
weighted average number of Ordinary shares outstanding during the period/year. 
The calculation of the basic (loss)/profit per share is based on the following 
data: 
 
                                         Six months ended 30 June  Year ended 
 
                                                                   31 December 
(Loss)/profit attributable to owners of  2023     2022             2022 
the Company 
                                         $'000    $'000            $'000 
(Loss)/profit for the purposes of basic  (172)    (1,746)          (1,562) 
(loss)/profit per share being net 
(loss)/profit attributable to owners of 
the Company 
 
                                         Number   Number           Number 
Number of shares                         `000     `000             `000 
Weighted average number of Ordinary      244,128  244,128          244,128 
shares for the purposes of basic 
(loss)/profit per share 
 
                                         Cent     Cent             Cent 
(Loss)/profit per Ordinary share 
Basic                                    (0.1)    (0.7)            (0.6) 
 
 6. Proved properties 
 
As of 31 June 2023, the development and production assets balance which forms 
part of PP&E has decreased in comparison to 31 December 2022 by 3%, mainly due 
to depletion charge for the period. 
 
 7. Inventories 
 
As of 30 June 2023 inventories decreased of $154 thousand (30 June 2023: $141 
thousand, 31 December 2022: $295 thousand) mainly due to volume of crude oil at 
the end of the month.. 
 
The impairment provision as at 30 June 2023 of $1 million is held to reduce the 
carrying value of the inventories to net realizable value. No additional 
provision on inventories has been recognised for the first half 2023. 
 
 8. Trade and other receivables 
 
                       Six months ended 30 June  Year ended 
 
                                                 31 December 
                       2023   2022               2022 
 
                       $'000  $'000              $'000 
VAT recoverable        112    135                77 
Prepayments            62     66                 60 
Other receivables      59     172                181 
                       233    373                318 
 
VAT recoverable asset was realized through natural gas and crude oil sales 
during the first half of 2023. The Directors consider that the carrying amount 
of the other receivables approximates their fair value. Management expects to 
realise VAT recoverable through the activities of the business segments. 
 
 9. Trade and other payables 
 
The $1.9 million of trade and other payables as at 30 June 2023 (30 June 2022: 
$1.3 million, 31 December 2022: $1.4 million) represent $1.5 million (30 June 
2022: $0.9 million, 31 December 2022: $0.8 million) of other creditors and $0.4 
million of accruals (30 June 2022: $0.4 million, 31 December 2022: $0.6 
million). 
 
10. Commitments and contingencies 
 
There have been no significant changes to the commitments and contingencies 
reported on page 80 of the Annual Report. 
 
11. Loan provided 
 
In February 2019, Cadogan used part of its cash (Euro 13.385 million) to enter 
into a 2-year Loan Agreement with Proger Managers & Partners, with an option to 
convert it into a direct 33% equity interest in Proger Ingegneria, equivalent to 
an indirect 25 % equity interest in Proger. According to IFRS, the instrument 
has to be represented in our balance sheet at fair value. 
 
In February 2021, Cadogan notified PMP that according to the Loan Agreement, the 
Maturity Date occurred on 25 February 2021. As the Call Option was not 
exercised, PMP must fulfil the payment of EUR 14,857,350, being the 
reimbursement of the Loan in terms of principal and the accumulated interest. 
PMP is in default since 25 February 2021. In case of default payment, the terms 
of the agreement provide for the application of an increased interest rate on 
the amount of the debt. 
 
Since the Call Option was not exercised before the Maturity Date and the asset 
is held within a business model whose objective is to hold assets in order to 
collect contractual cash flows, the Loan provided was reclassified from 
`Financial assets at fair value through profit and loss' to `Financial assets at 
amortized cost'. 
 
                      Financial assets at amortised cost 
                      $'000 
As at 1 January 2022  16,724 
Interest              614 
Change in provision   (600) 
Exchange differences  (1,411) 
As at 30 June 2022    15,327 
Interest              724 
Change in provision   (700) 
Exchange differences  474 
As at 1 January 2023  15,825 
Interest              704 
Change in provision   (350) 
Exchange differences  262 
As at 30 June 2023    16,441 
 
To represent the option at fair value, the Group has applied a level 3 valuation 
under IFRS as inputs to the valuation have included assessment of the cash 
repayments anticipated under the loan terms at maturity, delayed by the 
arbitration process requested by PMP (the Borrower), historical financial 
information for the periods prior to 2020 and assessment of the security 
provided by the pledge over shares together with the impact of the Covid-19 on 
the activity of Proger. As a result, $ 16.8 million was determined as the best 
estimate of fair value as at 31 December 2020, being equal to anticipated 
receipts and timing thereof discounted at an estimated market rate of interest 
of 7.8%. 
 
Proger Managers & Partners srl has failed to reimburse the Loan with the 
accumulated interests in full at the Maturity Date, 25 February 2021. In case of 
non-reimbursement, the Loan carries an entitlement to an interest at a rate of 
7.5% per year to be accrued on principle amount and accumulated interests at the 
Maturity Date until the total amount is paid. Starting from March 2021, Cadogan 
treats the Loan provided to PMP at historical cost plus accrued interests and 
less provision.In August 2022, the Company was informed of the award of the 
arbitral proceeding which: 
 
-             rejected Proger's principal claim and declared that the Loan 
Agreement is valid and effective, 
 
-             deemed to qualify the Call Option as a preliminary contract under 
condition, but 
 
-             rejected Proger's claim ex art.2932 Italian Civil Code, stating 
that it is impossible to give an award producing the same effects of a final 
contract ex art.2932 Italian Civil Code, 
 
-             this because of the duties established by the rules of the London 
Regulatory Authority and because of the need, possibly by both parties, to 
comply with the due proceedings before the formalization of the entry of Cadogan 
into the capital of Proger Ingegneria, 
 
-             subordinated the stipulation of the final contract to the 
precedent completion of the proceeding and bureaucratic process as per the 
British rules, stating that, otherwise, 
 
-             there is the obligation on Proger Ingegneria to return the payment 
received under the Loan Agreement, 
 
-             compensated all the expenses of the proceeding. 
 
Proger refused to apply the requirements of the award and thus, Proger must 
reimburse the amount covered by the Loan Agreement plus interest accrued in the 
meantime. Cadogan is taking the necessary legal actions to recover these 
amounts. 
 
The recoverability of the Loan had been assessed in April 2023 for the purpose 
of Cadogan Annual Report 2022. 
 
Due to expected delay in the loan reimbursement, the Company recognized 
additional provision of $350 thousand. 
 
12. Share capital 
 
Authorized and issued equity share capital 
 
                               30/06/2023         31/12/2022 

                               Number     $'000   Number     $'000 
Authorized                     1,000,000  57,713  1,000,000  57,713 
 
Ordinary shares of £0.03 each 
Issued                         244,128    13,832  244,128    13,832 
 
Ordinary shares of £0.03 each 
 
Authorized but unissued share capital of £30 million has been translated into US 
dollars at the historic exchange rate of the issued share capital. The Company 
has one class of Ordinary shares, which carry no right to fixed income. 
 
Issued equity share capital 
 
                                   Ordinary shares 
 
                                   of £0.03 
At 31 December 2020                244,128,487 
Issued during year                 - 
At 31 December 2021                244,128,487 
Issued during year                 - 
At 31 December 2022                244,128,487 
Issued during first-half year      - 
At 30 June 2023                    244,128,487 
 
13.             Events subsequent to the reporting date 
 
In July, a trading activity was conducted by the Ukrainian subsidiary 
(Astroinvest-Energy LLC). 
 
In August 2023, the Group has started the process of reorganisation of 
subsidiaries in Ukraine. 
 
Furthermore, the Group is studying a gas-to-power solution for the optimization 
of the use of the produced gas in its oil production operations. 
 
[1] Lost Time Incident, Total Recordable Incident 
 
 
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September 11, 2023 02:00 ET (06:00 GMT)