Aminex PLC 2024 Half-Yearly Financial Report

RNS Number : 1237G

Aminex PLC

30 September 2024

 

30 September 2024

 

2024 HALF-YEARLY FINANCIAL REPORT

 

Aminex PLC ("Aminex" or "the Group" or "the Company") announces its unaudited half-yearly report for the six months ended 30 June 2024.

 

 

REPORTING PERIOD HIGHLIGHTS

 

·       Signing of a gas sales agreement for the sale of Ntorya gas to the Tanzania Petroleum Development Corporation.

·       Award of a 25-year development licence over the Ntorya gas discovery area.

·       Commitment from the Government of Tanzania to complete the construction of the Ntorya to Madimba pipeline within six months.

·       A significant resource upgrade over the Ntorya discovery and wider area.

·       Loss for the period of US$1.35 million (30 June 2023: loss of US$0.96 million).

 

Charles Santos, Executive Chairman of Aminex commented:

 

"We are pleased with this year's progress on critical commercial aspects of the Ntorya project - the signing of the Gas Sales Agreement and the issuance of the Development Licence. We are excited about ARA Petroleum Tanzania Limited's 3D seismic survey results, which highlighted significant additional resources for the Ntorya discovery and wider area. We look forward to progress on operations through ARA Petroleum Tanzania Limited in the coming months. We are impressed with the Tanzanian Government's resolve to expedite the gas pipeline construction from Ntorya to the Madimba gas plant and its clear commitment to use its gas resources to improve the economic conditions of the Tanzanian people."

 

 

For further information:   Aminex PLC [phone] Charles Santos, Executive Chairman Knights Media & Public Relations [phone] Jason Knights, Sabina Zawadzki     Davy [phone] Brian Garrahy     Shard Capital [phone] Damon Heath

 

 

INTERIM MANAGEMENT REPORT

 

Executive Chairman's Review

 

Aminex PLC's results for the six months ended 30 June 2024 are set out below.

 

The Company reports a loss for the period of US$1.35 million (30 June 2023: US$0.96 million). Further information is provided in the Financial Review.

 

During 2024, the following crucial events have occurred:

 

·      The signing of a gas sales agreement for the sale of Ntorya gas to the Tanzania Petroleum Development Corporation (TPDC), securing a route to market for production from Ntorya.

·      The issuance of the Ntorya 25-year Development Licence. The Development Licence is a significant milestone for our Company and for the United Republic of Tanzania, as it is the first such licence issued in more than 13 years, ushering in a new and more dynamic approach to gas production and energy investment in Tanzania.

·      The Development Licence Handover Ceremony in Mtwara. This significant event marked the full and public commitment of the Tanzanian government to develop the Ntorya project as a key priority in its urgent effort to address its power shortages and bring the benefits of natural gas to the people of Tanzania.  

·      The clear and public commitment from the Office of the President and the Office of the Prime Minister to construct a gas pipeline spur from Ntorya to the Madimba gas processing plant in the coming six months.

 

Furthermore, Eclipse Investments LLC and Aminex signed a funding facility for US$3.00 million in April, ensuring Aminex has sufficient working capital available after 2024 and until the commencement of revenues from Ntorya gas sales.

 

Ruvuma PSA

 

In addition to the events mentioned above, I also wish to note the importance of the acquired, processed, and interpreted 338 km² 3D seismic in 2022 and 2023, which resulted in the identification of significant additional potential gas volumes within the licence area. The most likely gas initially in place (GIIP) potentially connected to the reservoir sandstones encountered in the Ntorya-1 (NT-1) and Ntorya-2 (NT-2) discovery wells is now estimated to be 3.45 trillion cubic feet (TCF). Furthermore, the 3D seismic dataset supports a substantial in-place unrisked resource potential of 16.38 TCF.

 

The Government of Tanzania's prioritisation of the Ntorya project means it has the potential to be developed within a timescale so that Ntorya gas can immediately service a fast-developing domestic market. Moreover, with the government's full support, the TPDC is empowered to move quickly to select a contractor to construct the gas pipeline spur to Madimba to meet the six-month timeline articulated by Tanzania's leadership. 

 

Kiliwani North and Kiliwani South - Kiliwani North Development Licence (KNDL)

 

We have recently had positive discussions with the TPDC and other Tanzanian government authorities on how best to proceed to ensure investment and gas production from this block. These discussions have, among other things, focused on the importance of revenue generation from Ntorya/the Ruvuma PSA.

 

Nyuni Area PSA

 

We continue to have useful discussions with TPDC regarding the Nyuni Area PSA.  

 

Financial Prudence and Funding

 

The Farm-Out of the Ruvuma PSA in 2020 carries the Company to potentially material levels of production and gas revenues without the need to return to shareholders for additional funding for the development of the Ntorya field. The Company holds a 25% interest in the Ruvuma PSA with a US$35 million carry of its share of costs. The carry, equivalent to US$140 million of gross field expenditure, is expected to see the Company through to potentially significant gas production volumes with commensurate revenues.

 

Moreover, we appreciate the continued strong support from our cornerstone investor, Eclipse Investments LLC, which has agreed to provide a funding facility for US$3.00 million against the carry, ensuring Aminex has sufficient working capital available after 2024 and until the commencement of revenues from Ntorya gas sales.

 

We continue to operate with significantly reduced costs and corporate overheads established in recent years. Base running costs (which exclude non-cash and one-off items), before recharges, increased by 6.5% to US$0.85 million for the six month period to 30 June 2024, compared with US$0.80 million for the same period in 2023. Despite this rise, base running costs are 67% lower, on an annualised basis, than 2018 levels when cost cutting measures were introduced. The Company has maintained an appropriate structure of capabilities and competencies that match current requirements with a more flexible approach that de-risks our business and creates strategic opportunities.

 

Outlook

 

This year has been decisive for our Company. We have made significant progress in the Ntorya project, providing shareholders with several catalytic events. More of these value inflection points will come. This year's events have improved the Company's underlying value and demonstrated the Operator's capacity to run numerous critical negotiations and operational workstreams. Of further importance, the Government of Tanzania has indicated its full support for and significance of Ntorya gas production in the shortest time feasible. The net result for Aminex is an essential shift in the narrative of Ntorya, which can now be considered a potentially world-class discovery with a path to positive cash flow by next year - a remarkable turnaround for the Company since 2020.

 

I want to thank our shareholders for their continued support and patience.

 

Yours sincerely,

 

 

 

 

Charles Santos           

Executive Chairman

30 September 2024

Financial Review

 

 

Revenue Producing Operations

 

Revenues from continuing operations amounted to US$0.02 million (30 June 2023: US$0.08 million). Group revenues during the first six months of 2024 are derived from the provision of technical and administrative services to joint operations.

 

Cost of sales was US$0.03 million (30 June 2023: US$0.11 million). The cost of sales for Kiliwani North operations amounted to US$0.02 million (30 June 2023: US$0.08 million) and included general licence related maintenance costs. There was no depletion charge for Kiliwani North as the period saw no production (30 June 2023: US$ nil).  The balance of the cost of sales amounting to US$0.01 million (30 June 2023: US$0.03 million) related to the oilfield services operations and minor non-operated costs related to the Group's interest in the Ruvuma PSA. Accordingly, there was a gross loss of US$0.01 million for the period compared with a gross loss of US$0.03 million for the comparative period.

 

Group administrative expenses, excluding depreciation and net of costs capitalised against projects, were US$0.99 million (30 June 2023: US$0.78 million), an increase of US$0.21 million. The increase in expenses during the period was due mainly to increases in the non-cash share options charge (US$0.16 million) and in consulting fees (US$0.09 million), partially offset by reductions in tax provisions (US$0.03 million) and payroll costs (US$0.03 million). Management continues to maintain strict expenditure controls in order to help maintain the cost-saving gains achieved since 2018, although inflationary pressures have recently had an adverse effect.

 

The Group recognised an impairment during the six-month period against exploration and evaluation assets of US$196,000 (30 June 2023: US$196,000). This is comprised solely of expenditure incurred on the Nyuni Area PSA (30 June 2023: US$181,000), which relates mainly to own costs for geological, geophysical and administrative work and licence maintenance costs, along with training and licence fees. There was no expenditure incurred during the six-month period on Kiliwani South Area (30 June 2023: US$15,000). All expenditure on the Nyuni Licence Area and the Kiliwani South Area continues to be impaired immediately to the income statement upon recognition following the full impairment in 2018 and 2021 respectively. The Group's resulting net loss from operating activities was US$1.29 million (30 June 2023: loss of US$0.98 million).  

 

Finance income of US$18,000 is a result of foreign exchange gains (30 June 2023: US$108,000).

 

Finance costs amounted to US$76,000 (30 June 2023: US$80,000) and relates solely to the decommissioning interest charge (30 June 2023: US$80,000).

 

The Group's net loss for the period amounted to US$1.35 million (30 June 2023: US$0.96 million).

 

Balance Sheet

 

The Group's investment in exploration and evaluation assets increased slightly from US$37.98 million at 31 December 2023 to US$38.00 million at 30 June 2024.  This was due to an increase of US$0.02 million of own costs for the Ruvuma PSA CGU. As noted above, all expenditure on the Nyuni Licence Area and the Kiliwani South Area continues to be impaired immediately to the income statement upon recognition as both are fully impaired. In accordance with the Group's accounting policy, the Group does not record expenditure for its share of costs that are carried by ARA Petroleum Tanzania Limited ("APT") in relation to the Ruvuma PSA asset. The Group is carried for a total of US$35.0 million of development expenditure on the Ruvuma PSA, with carried expenditure in the period relating to development activities.

 

The carrying value of property, plant and equipment ("PP&E") has decreased from US$4,000 at 31 December 2023 to US$3,000 at 30 June 2024. This is a result of depreciation for the period and no purchases of new equipment. The costs for the Kiliwani North CGU are included in PP&E but are fully impaired (see Note 9).

 

Current assets amounted to US$3.28 million (31 December 2023: US$4.63 million) with trade and other receivables of US$1.50 million (31 December 2023: US$1.59 million), which as operator includes joint operations partner's interests in gas revenues, and cash and cash equivalents of US$1.78 million (31 December 2023: US$3.04 million). The decrease in current assets of US$1.35 million predominantly related to the reduction in cash due to expenditures on G&A and tax payments.

 

Current liabilities amounted to US$7.82 million compared with US$8.19 million at 31 December 2023. This balance included amounts payable to joint operations partners for their profit shares from invoiced gas sales, related VAT and excise tax payable on the gas receivables invoices and provisions and accruals for taxes. The decrease related mainly to US$0.33 million in payments to the TRA for accrued VAT and WHT included in the 2019-2020 tax assessment and reduction of amounts due to joint operations partners of US$0.15 million, offset by an increase of US$0.18 million in accrued training and licence fee invoices from the Petroleum Upstream Regulatory Authority in Tanzania. Non-current liabilities are US$1.92 million (31 December 2023: US$1.82 million) being the decommissioning provision which increased during the period as a result of the unwind of the discount during the period of US$0.08 million and US$0.02 million for an increase in estimated costs due to changes in inflation and discount rates.

 

Total equity has decreased by US$1.07 million between 31 December 2023 and 30 June 2024 to US$31.54 million (31 December 2023: US$32.61 million). This is due to the increase in the retained deficit arising from the loss for the period, offset by increases in issued capital and share premium (US$0.08 million as a result of share options exercised) and the movement in the share option reserve.

 

Cash Flows

 

Net cash outflows from operating activities were US$1.29 million during the period (30 June 2023: cash outflow of US$0.71 million), being mainly G&A expenditures and payment of accrued indirect taxes. Net cash outflows from investing activities amounted to US$0.07 million (30 June 2023: US$0.17 million), mainly for care and maintenance expenditure on the KND Licence. Cash inflows from financing activities during the period were US$ 0.08 million from share issue proceeds (30 June 2023: US$nil).  Net cash and cash equivalents for the six months ended 30 June 2024 therefore decreased by US$1.28 million compared with a decrease of US$0.88 million for the comparative half-year period.  The balance of net cash and cash equivalents at 30 June 2024 was US$1.78 million (30 June 2023: US$5.04 million).

 

Related party transactions

 

There have been no material changes in the related party transactions affecting the financial position or the performance of the Group in the period since publication of the 2023 Annual Report other than those disclosed in Note 14 to the condensed consolidated financial statements.

 

Going Concern

 

The financial statements of the Group are prepared on a going concern basis.

 

The Directors have given careful consideration to the Group's ability to continue as a going concern through review of cash flow forecasts prepared by management for the going concern period to 30 September 2025, review of the key assumptions on which these forecasts are based and the sensitivity analysis. The forecasts reflect the Directors' best estimate of expenditures and receipts during the going concern period. The forecasts are regularly updated to enable continuous monitoring and management of the Group's cash flow and liquidity risk. The forecasts indicate that, subject to the principal assumptions noted below, the Group would have adequate resources to continue as a going concern for the foreseeable future, that is a period of not less than 12 months from the date of approval of the consolidated financial statements. 

 

As part of its analysis in making the going concern assumption, the Directors have considered the range of risks facing the business on an ongoing basis, as set out in the risk section of the 2023 Annual Report, that remain applicable to the Group. The principal assumptions made in relation to the Group's going concern assessment relate to the capital commitments on its operated assets in Tanzania, the reservation of rights made by the TPDC in respect of certain claims that the Directors consider are without merit and the ongoing objections to the tax assessments in Tanzania (see Note 13).

 

Current liabilities of the Group exceeded its current assets as at 30 June 2024, mainly as a result of provisions made for some contested tax assessments. As disclosed in Note 13, the Group received a tax assessment in February 2020 from the Tanzania Revenue Authority ("TRA") of US$2.2 million in relation to an audit of the Group's Tanzanian wholly owned subsidiary covering the period from 2013 to 2015 and tax assessments in June 2022 for US$4.8 million in relation to audits covering the period from 2016 to 2018. These tax assessments are excluded from the cash forecast as any cash outflow during the going concern period is not considered probable based on either legal advice or the timeframes for tax cases in Tanzania. Tax assessments received in June 2023 from the TRA of US$3.3 million in relation to an audit covering the period from 2019 to 2020 are included insofar as they are covered by a payment plan agreed with the TRA in June 2024. Additionally, development and decommissioning of the Group's assets in Tanzania is excluded from the cash forecast. The Group commenced discussions with the Tanzanian authorities during 2022 to return the Nyuni Area licence to the Ministry of Energy and such discussions have resulted in the Group being requested to market the licence in 2023 and 2024, in an attempt to find a third-party partner willing to pursue and fund a mutually agreed re-negotiated work programme. Regardless of whether the farm-out process is successful or not, it is not considered probable that any capital expenditure would arise in the period. However, a risk exists that the Group lose the objections to the tax assessments or may be unable to renegotiate or defer commitments relating to the development or decommissioning of the operated Licence interests during the period, or that the TPDC may take action to enforce their claims to certain rights during the period and, therefore, the Group may need to raise additional funding to meet these potential liabilities, in addition to the US$3 million funding facility agreement between Aminex and Eclipse Investments LLC, a major shareholder in the Company, signed in April 2024. There is material uncertainty as to its ability to raise such additional funding. This may result in the Group having to raise funds at whatever terms are available at the time, which is not guaranteed.

 

These circumstances indicate that a material uncertainty exists that may cast significant doubt on the Group's ability to continue as a going concern and, therefore, the Group may be unable to realise its assets and discharge its liabilities in the normal course of business. As the Group has been successful in raising equity funds at various times and in similar circumstances in the recent past on acceptable terms to the Group, the Directors have a reasonable expectation that additional funding can be raised. Despite the aforementioned material uncertainty, the Directors have confidence in the Group's forecasts and have a reasonable expectation that the Group will continue in operational existence for the foreseeable future and have therefore used the going concern basis in preparing these financial statements. The financial statements do not include the adjustments that would result if the Group were unable to continue as a going concern.

 

Principal Risks and Uncertainties

 

The Group's strategic objectives for its principal activities, being the production and development of and the exploration for oil and gas reserves, are only achievable if certain risks are managed effectively. The Board has overall accountability for determining the type and level of risk it is prepared to take. The Board is assisted by the Audit and Risk Committee, which oversees the process for review and monitoring of risks, and the implementation of mitigation actions, by management. The Audit and Risk Committee reviews management's findings regularly and reports to the Board accordingly. Assessment of risks is made under four categories: Strategic Risks, Operational Risks, Compliance Risks and Financial Risks.

 

Aminex has reviewed and assessed the principal risks and uncertainties at 30 June 2024 and concluded that the principal risks identified at 31 December 2023 and disclosed on pages 24 to 26 of the 2023 Annual Report are still appropriate. The following are considered to be the key principal risks facing the Group over the next six months although there are other risks which may impact the Group's performance:

 

·      Ability to meet licence work commitments

·      Lack of exploration, appraisal and development drilling success

·      Adverse and unexpected tax assessments in Tanzania

·      Ability to secure other financing for Group operations

·      Political and fiscal uncertainties  

 

Forward Looking Statements

 

Certain statements made in this half-yearly financial report are forward-looking statements. Such statements are based on current expectations and are subject to a number of risks and uncertainties that could cause actual events or results to differ materially from the expected future events or results referred to in these forward-looking statements.

 

Statement of Directors' Responsibilities

In respect of the Half-Yearly Financial Report

 

Each of the Directors who held office at the date of this report, confirm their responsibility for preparing the half-yearly financial report in accordance with the Transparency (Directive 2004/109/EC) Regulations 2007 (as amended) and IAS 34 Interim Financial Reporting, as adopted by the EU and to the best of each person's knowledge and belief:

 

·      The condensed consolidated financial statements comprising the condensed consolidated income statement, the condensed consolidated statement of comprehensive income, the condensed consolidated balance sheet, the condensed consolidated statement of changes in equity, the condensed consolidated statement of cashflows and the related explanatory notes have been prepared in accordance with IAS 34 Financial Reporting as adopted by the EU.

 

·      The Interim Management Report includes a fair review of the information required by:

 

(a)   Regulation 8(2) of the Transparency (Directive 2004/109/EC) Regulations 2007, being an indication of important events that have occurred during the first six months of the financial year and their impact on the condensed set of financial statements; and a description of the principal risks and uncertainties for the remaining six months of the year; and

 

(b)   Regulation 8(3) of the Transparency (Directive 2004/109/EC) Regulations 2007, being related party transactions that have taken place in the first six months of the current financial year and that have materially affected the financial position or performance of the entity during that period; and any changes in the related party transactions described in the last annual report that could do so.

 

 

 

 

On behalf of the Board

 

 

 

Charles Santos

Executive Chairman/Director

30 September 2024

 

 

Aminex PLC

CONDENSED CONSOLIDATED INCOME STATEMENT

for the six months ended 30 June 2024                                                    

                                                                                                                                                                     

	Notes	Unaudited 6 months ended 30 June 2024 US$'000		Unaudited 6 months ended 30 June 2023 US$'000		Audited Year ended 31 December 2023 US$'000
Continuing operations
Revenue	2	21		81		112
Cost of sales		(29)		(114)		(82)
Gross loss		(8)		(33)		(30)
Administrative expenses		(986)		(776)		(695)
Impairment against exploration and evaluation assets	8	(196)		(196)		(346)
Impairment against property, plant and equipment assets	9	(107)		21		(103)
Loss from operating activities		(1,297)		(984)		(1,114)
Finance income	4	18		108		154
Finance costs	5	(76)		(80)		(159)
Loss before tax		(1,355)		(956)		(1,119)
Income tax expense	6	-		-		-
Loss for the period	2	(1,355)		(956)		(1,119)
Loss per share
Basic and diluted (US cents)	7	(0.03)		(0.02)		(0.03)

 

 

CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

for the six months ended 30 June 2024

	Unaudited 6 months ended 30 June 2024 US$'000		Unaudited 6 months ended 30 June 2023 US$'000		Audited Year ended 31 December 2023 US$'000
Loss for the period	(1,355)		(956)		(1,119)
Other comprehensive income
Items that are or may be reclassified subsequently to profit or loss:
Currency translation differences	(8)		29		37
Total comprehensive expense for the period attributable to the equity holders of the Company	(1,363)		(927)		(1,082)

Aminex PLC

CONDENSED CONSOLIDATED BALANCE SHEET

At 30 June 2024                                                                                                                                                                    

                                                                                               

	Notes	Unaudited 30 June 2024 US$'000		Unaudited              30 June  2023 US$'000		Audited 31 December 2023 US$'000
Assets
Non-current assets
Exploration and evaluation assets	8	38,001		38,032		37,978
Property, plant and equipment	9	3		5		4
Total non-current assets		38,004		38,037		37,982
Current assets
Trade and other receivables	10	1,500		1,562		1,592
Cash and cash equivalents	11	1,778		5,036		3,041
Total current assets		3,278		6,598		4,633
TOTAL ASSETS		41,282		44,635		42,615
Equity
Issued capital		69,703		69,695		69,695
Share premium		128,409		128,340		128,340
Other undenominated capital		234		234		234
Share option reserve		1,603		1,290		1,541
Foreign currency translation reserve		(2,275)		(2,275)		(2,267)
Retained deficit		(166,134)		(164,771)		(164,934)
Total equity		31,540		32,513		32,609
Liabilities
Non-current liabilities
Decommissioning provision		1,920		1,916		1,821
Total non-current liabilities		1,920		1,916		1,821
Current liabilities
Trade and other payables	12	7,822		10,206		8,185
Total current liabilities		7,822		10,206		8,185
Total liabilities		9,742		12,122		10,006
TOTAL EQUITY AND LIABILITIES		41,282		44,635		42,615

 

 

 

Aminex PLC

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

for the six months ended 30 June 2024

 

                                   Attributable to equity shareholders of the Company

 

	Share capital	Share premium	Other undenominated capital	Share option reserve	Foreign currency translation reserve	Retained deficit	Total equity
	US$'000	US$'000	US$'000	US$'000	US$'000	US$'000	US$'000
At 1 January 2023	69,695	128,340	234	1,231	(2,304)	(163,815)	33,381
Comprehensive income
Loss for the period	-	-	-	-	-	(956)	(956)
Currency translation   differences	-	-	-	-	29	-	29
Transactions with shareholders of the Company recognised directly in equity
Share based payment charge	-	-	-	59	-	-	59
At 30 June 2023	69,695	128,340	234	1,290	(2,275)	(164,771)	32,513
Comprehensive income
Loss for the period	-	-	-	-	-	(163)	(163)
Currency translation differences	-	-	-	-	8	-	8
Transactions with shareholders of the Company recognised directly in equity
Share-based payment charge	-	-	-	251	-	-	251
At 31 December 2023 as previously reported	69,695	128,340	234	1,541	(2,267)	(164,934)	32,609
Comprehensive income
Loss for the period	-	-	-	-	-	(1,355)	(1,355)
Currency translation differences	-	-	-	-	(8)	-	(8)
Transactions with shareholders of the Company recognised directly in equity
Shares issued	8	69	-	-	-	-	77
Shares options reserve transfer	-	-	-	(155)	-	155	-
Share based payment charge	-	-	-	217	-	-	217
At 30 June 2024 (unaudited)	69,703	128,409	234	1,603	(2,275)	(166,134)	31,540

 

 

 

 

 

Aminex PLC

CONDENSED CONSOLIDATED STATEMENT OF CASHFLOWS

for the six months ended 30 June 2024

                                                                                           

	Unaudited 6 months ended 30 June 2024 US$'000		Unaudited 6 months ended 30 June 2023 US$'000		Audited Year ended 31 December 2023 US$'000
Operating activities
Loss for the financial period	(1,355)		(956)		(1,119)
Depreciation and depletion	1		1		3
Equity-settled share-based payments	217		59		310
Finance income	(18)		(108)		(154)
Finance costs	76		80		159
Impairment of exploration and evaluation assets	196		196		346
Impairment of property, plant and equipment	107		(21)		103
Trade receivables write-off	-		-		-
(Increase) / decrease in trade and other receivables	(4)		(240)		(254)
(Decrease) / increase in trade and other payables	(506)		280		(2,048)
Net cash (used in) / generated by operating activities	(1,286)		(709)		(2,654)
Tax paid	-		-		-
Net cash (outflows) / inflows from operating activities	(1,286)		(709)		(2,654)
Investing activities
Acquisition of property, plant and equipment	(43)		-		(202)
Expenditure on exploration and evaluation assets	(29)		(168)		(62)
Net cash (outflows) / inflows from investing activities	(72)		(168)		(264)
Financing activities
Proceeds from the issue of share capital	77	-	-		-
Payment of transaction costs on issue of share capital	-		-		-
Payment of borrowings	-		-		-
Payment of interest on borrowings	-		-		-
Net cash inflows / (outflows) from financing activities	77		-		-
Net (decrease) / increase in cash and cash equivalents	(1,281)		(877)		(2,918)
Cash and cash equivalents at 1 January	3,041		5,805		5,805
Foreign exchange gain	18		108		154
Cash and cash equivalents at end of the financial period	1,778		5,036		3,041

 

 

 

 

Aminex PLC

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

for the six months ended 30 June 2024

 

1.    Basis of preparation

 

The condensed consolidated financial statements included in this Half-Yearly Financial Report have been prepared in accordance with IAS 34 "Interim Financial Reporting" as adopted by the European Union. They do not include all of the information required for full annual statutory financial statements and should be read in conjunction with the audited consolidated financial statements of Aminex PLC as at and for the year ended 31 December 2023. The financial information contained in the condensed financial statements has been prepared in accordance with the accounting policies set out in the 2023 Annual Report and Accounts.

 

The financial information presented herein does not amount to statutory financial statements that are required by Part 6 of Chapter 4 of the Companies Act 2014 to be annexed to the annual return of the Company. The statutory financial statements for the financial year ended 31 December 2023 were annexed to the annual return and filed with the Companies Registration Office in Ireland. The audit report on those statutory financial statements was unqualified and included an emphasis of matter paragraph relating to going concern.

 

The financial statements have been prepared on the historical cost basis, as modified for the measurement of certain financial instruments at fair value through profit or loss. These financial statements are presented in US Dollars ("USD") which is the currency of the primary economic environment in which the Group operates and are rounded to the nearest thousand, unless otherwise stated. The preparation of the Half-Yearly Financial Report requires the Directors to make judgements, estimates and assumptions that affect the application of policies and reported amounts of certain assets, liabilities, revenues and expenses together with disclosure of assets and liabilities. Estimates and underlying assumptions relevant to these financial statements are the same as those described in the last annual financial statements. Terms used in this condensed set of consolidated financial statements are defined in the Glossary on page 69 in the 2023 Annual Report and Accounts.

 

These condensed consolidated financial statements were authorised for issue by the Board of Directors on 30 September 2024.

 

The Interim Report has not been audited or formally reviewed by the Company's Auditor in accordance with the

International Standards on Auditing (ISAs) (Ireland) or International Standards on Review Engagements (ISREs).

 

(i)            Going concern

 

The financial statements of the Group are prepared on a going concern basis.

 

The Directors have given careful consideration to the Group's ability to continue as a going concern through review of cash flow forecasts prepared by management for the going concern period to 30 September 2025, review of the key assumptions on which these forecasts are based and the sensitivity analysis. The forecasts reflect the Directors' best estimate of expenditures and receipts during the going concern period. The forecasts are regularly updated to enable continuous monitoring and management of the Group's cash flow and liquidity risk. The forecasts indicate that, subject to the principal assumptions noted below, the Group would have adequate resources to continue as a going concern for the foreseeable future, that is a period of not less than 12 months from the date of approval of the consolidated financial statements.  

 

As part of its analysis in making the going concern assumption, the Directors have considered the range of risks facing the business on an ongoing basis, as set out in the risk section of the 2023 Annual Report, that remain applicable to the Group. The principal assumptions made in relation to the Group's going concern assessment relate to the capital commitments on its operated assets in Tanzania, the reservation of rights made by the TPDC in respect of certain claims that the Directors consider are without merit and the ongoing objections to the tax assessments in Tanzania (see Note 13).

 

Current liabilities of the Group exceeded its current assets as at 30 June 2024, mainly as a result of provisions made for some contested tax assessments. As disclosed in Note 13, the Group received a tax assessment in February 2020 from the Tanzania Revenue Authority ("TRA") of US$2.2 million in relation to an audit of the Group's Tanzanian wholly owned subsidiary covering the period from 2013 to 2015 and tax assessments in June 2022 for US$4.8 million in relation to audits covering the period from 2016 to 2018. These tax assessments are excluded from the cash forecast as any cash outflow during the going concern period is not considered probable based on either legal advice or the timeframes for tax cases in Tanzania. Tax assessments received in June 2023 from the TRA of US$3.3 million in relation to an audit covering the period from 2019 to 2020 are included insofar as they are covered by a payment plan agreed with the TRA in March 2024. Additionally, development and

Aminex PLC

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

for the six months ended 30 June 2024

 

1.    Basis of preparation (continued)

 

(i)      Going concern (continued)

 

decommissioning of the Group's assets in Tanzania is excluded from the cash forecast. The Group commenced discussions with the Tanzanian authorities during 2022 to return the Nyuni Area licence to the Ministry of Energy and such discussions have resulted in the Group being requested to market the licence in 2023 and 2024, in an attempt to find a third-party partner willing to pursue and fund a mutually agreed re-negotiated work programme. Regardless of whether the farm-out process is successful or not, it is not considered probable that any capital expenditure would arise in the period. However, a risk exists that the Group lose the objections to the tax assessments or may be unable to renegotiate or defer commitments relating to the development or decommissioning of the operated Licence interests during the period, or that the TPDC may take action to enforce their claims to certain rights during the period and, therefore, the Group may need to raise additional funding to meet these potential liabilities, in addition to the US$3 million funding facility agreement between Aminex and Eclipse Investments LLC, a major shareholder in the Company, signed in April 2024. There is material uncertainty as to its ability to raise such additional funding. This may result in the Group having to raise funds at whatever terms are available at the time, which is not guaranteed.

 

These circumstances indicate that a material uncertainty exists that may cast significant doubt on the Group's ability to continue as a going concern and, therefore, the Group may be unable to realise its assets and discharge its liabilities in the normal course of business. As the Group has been successful in raising equity funds at various times and in similar circumstances in the recent past on acceptable terms to the Group, the Directors have a reasonable expectation that additional funding can be raised. Despite the aforementioned material uncertainty, the Directors have confidence in the Group's forecasts and have a reasonable expectation that the Group will continue in operational existence for the foreseeable future and have therefore used the going concern basis in preparing these financial statements. The financial statements do not include the adjustments that would result if the Group were unable to continue as a going concern.

 

(ii)     Use of judgements and estimates

 

The preparation of the condensed consolidated financial statements requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates.

 

Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimates are revised and in any future periods affected.

 

The significant judgements made by management in applying the Group's accounting policies and the key sources of estimation uncertainty were the same as those described in the 2023 Annual Report and Accounts.

 

(iii)    New and amended standards adopted by the Group

 

A number of amended standards became effective for the financial year beginning on 1 January 2024; however, the Group did not have to change its accounting policies or make retrospective adjustments as a result of adopting these amended standards.

 

(iv)    Impact of standards issued but not yet adopted by the Group

 

There are no standards issued but not yet adopted by the Group.

 

 

 

 

Aminex PLC

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

for the six months ended 30 June 2024

 

2.      Segmental disclosure - continuing operations

 

An operating segment is a component of the Group that engages in business activities from which it may earn revenues and incur expenses, including revenues and expenses that relate to transactions with any of the Group's other components.

 

The Group considers that its operating segments consist of (i) Producing Oil and Gas Properties, (ii) Exploration Activities and (iii) Oilfield Services. These segments are those that are reviewed regularly by the Chief Operating Decision Maker (Executive Chairman) to make decisions about resources to be allocated to the segment and assess its performance and for which discrete financial information is available. However, the Group further analyses these by region for information purposes. Segment results include items directly attributable to the segment as well as those that can be allocated on a reasonable basis. Unallocated Aminex Group items comprise mainly head office expenses, cash balances and certain other items.

 

The Group's revenue is derived from contracts with customers. The timing of revenue streams depends on the following for products and services:

 

Producing oil and gas assets

The Group satisfies its performance obligation by transferring a nominated volume of gas to its customer. The title to gas transfers to a customer when the customer takes physical possession of the gas at the contracted delivery point. The gas needs to meet certain agreed specifications. The Group generated no revenue for the period under this segment (30 June 2023: US$nil).

 

Oilfield services

Revenue for services is recognised as services are rendered to the customer. All services rendered by the Group relate to jointly controlled operations to which the Group is a party and the terms of the services provided are subject to service contracts.

 

The IFRS 8 operating segments as follows (i) Producing Oil and Gas Properties, (ii) Exploration Activities and (iii) Oilfield Services are the disaggregation of revenue from customers as required by IFRS 15.

 

 

 

 

 

Aminex PLC

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

for the six months ended 30 June 2024

 

2.      Segmental disclosure - continuing operations (continued)

 

Operating segment results - 30 June 2024 (unaudited)

 

US$'000		Tanzania				Tanzania				UK				Unallocated
		Producing oil and gas properties				Exploration activities				Oilfield services				Corporate Aminex  Group				Total
		30 June 2024				30 June 2024				30 June 2024				30 June 2024				30 June 2024
Revenue		-				-				21				-				21
Cost of sales		(9)				(2)				(18)				-				(29)
Gross loss		(9)				(2)				3				-				(8)
Depreciation		-				-				-				(1)				(1)
Administrative expenses		(75)				-				(97)				(813)				(985)
Impairment against PP&E assets		-				(107)				-				-				(107)
Impairment against exploration and evaluation assets		-				(196)				-				-				(196)
Loss from operating activities		(84)				(305)				(94)				(814)				(1,297)
Finance costs		(16)				(61)				-				1				(76)
Finance income		-				-				-				-				-
Foreign exchange gains		-				-				-				18				18
Loss before tax		(100)				(366)				(94)				(795)				(1,355)
Taxation		-				-				-				-				-
Loss for the period		(100)				(366)				(94)				(795)				(1,355)
Segment assets		1,483				38,123				-				1,676				41,282
Segment liabilities		(2,415)				(3,528)				-				(3,799)				(9,742)
Capital expenditure additions		107				220				-				-				327
Other material non-cash items
Share based payments (Note 3)		-				-				-				(217)				(217)
Unwinding of discount on decommissioning provision (Note 5)		(15)				(61)				-				-				(76)

Operating segment results - 30 June 2023 (unaudited)

 

US$'000	Tanzania		Tanzania		UK		Unallocated
	Producing oil and gas properties		Exploration activities		Oilfield services		Corporate Aminex Group		Total
	30 June 2023		30 June 2023		30 June 2023		30 June 2023		30 June 2023
Revenue	-		-		81		-		81
Cost of sales	(27)		(6)		(81)		-		(114)
Gross loss	(27)		(6)		-		-		(33)
Depreciation	-		-		-		(1)		(1)
Administrative expenses	(113)		-		(97)		(565)		(775)
Impairment against PP&E assets	21		-		-		-		21
Impairment against exploration and evaluation assets	-		(196)		-		-		(196)
Loss from operating activities	(119)		(202)		(97)		(566)		(984)
Finance costs	(19)		(60)		-		(1)		(80)
Finance income	-		-		-		-		-
Foreign exchange gains	-		-		-		108		108
Loss before tax	(138)		(262)		(97)		(459)		(956)
Taxation	-		-		-		-		-
Loss for the period	(138)		(262)		(97)		(459)		(956)
Segment assets	2,388		38,143		-		4,104		44,635
Segment liabilities	(3,846)		(3,492)		-		(4,784)		(12,122)
Capital expenditure additions	(21)		180		-		-		159
Other material non-cash items
Share based payments (Note 3)	-		-		-		(59)		(59)
Unwinding of discount on decommissioning provision (Note 5)	(20)		(60)		-		-		(80)

Aminex PLC

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

for the six months ended 30 June 2024

 

3.      Share based payments

 

Aminex PLC operates or operated the following share option schemes:

·      Executive Share Option Scheme ("ESOS"). Under the terms of the ESOS, certain Directors and employees of Aminex PLC, and its subsidiary companies, were entitled to subscribe for Ordinary Shares in Aminex PLC at the market value on the date of the granting of the options. Options are granted at market price, in accordance with the ESOS rules, with reference to the average closing price for the fourteen days prior to the grant of options.  Options granted in February 2019 and February 2020 vest immediately, and the options granted in November 2019 and January 2020 vest in tranches subject to the achievement of certain market and non-market performance conditions. The options granted in 2019 and 2020 will expire at a date either 5, 7 or 10 years after their date of grant. The ESOS expired on 10 May 2020 and therefore no further share options will be granted pursuant to the ESOS.

·      New Restricted Share Plan ("New RSP"). The New RSP was adopted by the Board on 1 July 2020 and approved by shareholders of the Company at its AGM on 29 July 2020.

 

There were no share options granted during the period.

 

The fair value at the grant date is measured using a recognised valuation methodology for the pricing of financial instruments i.e. the Black-Scholes method.  The following expenses have been recognised in the income statement arising on share-based payments and included within administrative expenses:

 

	Unaudited 6 months ended 30 June  2024 US$'000		Unaudited 6 months ended 30 June  2023 US$'000		Audited  year ended 31 December 2023 US$'000
Share-based payment charge	217		59			310

 

On 30 June 2024, there were options granted under the ESOS and the New RSP outstanding over 126,611,000 (31 December 2023: 145,361,000) Ordinary Shares which are exercisable at prices ranging from Stg 0.60 pence to Stg 1.56 pence per share and which expire at various dates up to 2029. The weighted average remaining contractual life of the options outstanding is 3.89 years (31 December 2023: 3.66 years). The average share price for the six months ended 30 June 2024 was Stg1.13pence / €0.0131 (year ended 31 December 2023: Stg1.15pence / €0.01220).

 

4.      Finance income

	Unaudited 6 months ended 30 June 2024 US$'000		Unaudited 6 months ended 30 June 2023 US$'000		Audited  year ended 31 December 2023 US$'000
Foreign exchange gain	18		108		154
	18		108		154

 

5.      Finance costs

	Unaudited 6 months ended 30 June  2024 US$'000		Unaudited 6 months ended 30 June  2023 US$'000		Audited  year ended 31 December 2023 US$'000
Interest expense	-		-		-
Other finance costs - decommissioning provision interest charge Foreign exchange loss	76 -		80 -		159 -
	76		80		159

 

 

Aminex PLC

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

for the six months ended 30 June 2024

 

6.      Tax

 

The Group has not provided any tax charge for the six-month periods ended 30 June 2024 and 30 June 2023. The Group's operating divisions have accumulated losses which are expected to exceed profits earned by operating entities for the foreseeable future.

 

7.      Loss per share from continuing activities

 

The profit or loss per Ordinary Share is calculated using a numerator of the profit or loss for the financial period and a denominator of the weighted average number of Ordinary Shares in issue for the financial period.  The diluted profit per Ordinary Share is calculated using a numerator of the profit for the financial period and a denominator of the weighted average number of Ordinary Shares outstanding and adjusted for the effect of all potentially dilutive shares, including share options and share warrants, assuming that they have been converted.

 

The calculations for the basic and diluted earnings per share of the financial periods ended 30 June 2024, 30 June 2023 and the year ended 31 December 2023 are as follows:

	Unaudited 6 months ended 30 June 2024		Unaudited 6 months ended 30 June 2023		Audited Year ended 31 December 2023
Numerator for basic and diluted earnings per share:
Loss for the financial period (US$'000)	(1,355)		(956)		(1,119)
Weighted average number of shares:
Weighted average number of ordinary shares ('000)	4,211,738		4,211,167		4,211,167
Basic and diluted loss per share (US cents)	(0.03)		(0.02)		(0.03)

 

There is no difference between the basic loss per Ordinary Share and the diluted loss per Ordinary Share for the financial periods ended 30 June 2024, 30 June 2023 and the year ended 31 December 2023 as all potentially dilutive Ordinary Shares outstanding were anti-dilutive. There were 195,611,000 share options in issue at 30 June 2024, 209,611,000 share options in issue at 30 June 2023 and 215,611,000 share options in issue at 31 December 2023. 

 

8.      Exploration and evaluation assets

 

Cost	US$'000
At 1 January 2024	104,876
Additions	219
At 30 June 2024	105,095
Provisions for impairment At 1 January 2024	66,898
Increase in impairment provision	196
At 30 June 2024	67,094
Net book value At 30 June 2024	38,001
At 31 December 2023	37,978

The Group does not hold any property, plant and equipment within exploration and evaluation assets.

 

The additions to exploration and evaluation assets during the period relate mainly to own costs capitalised for geological, geophysical and administrative ("GG&A") work and licence maintenance costs, along with training and licence fees under the respective PSAs, plus an increase in estimates for decommissioning costs.

 

 

Aminex PLC

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

for the six months ended 30 June 2024

 

8.      Exploration and evaluation assets (continued)

 

The amount for exploration and evaluation assets represents active exploration projects. These will ultimately be written off to the Income Statement as exploration costs if commercial reserves are not established but are carried forward in the Balance Sheet whilst the determination process is not yet completed and there are no indications of impairment having regard to the indicators in IFRS 6.

 

In accordance with its accounting policies each CGU is evaluated annually for impairment, with an impairment test required when a change in facts and circumstances, in particular with regard to the remaining licence terms, likelihood of renewal, likelihood of further expenditures and ongoing acquired data for each area, result in an indication of impairment.

 

Ruvuma PSA

 

The Ruvuma PSA comprised two exploration licences; Mtwara and Lindi. On 22 October 2020, the Group completed the Ruvuma Farm-Out. On completion, the Group, through its wholly owned subsidiary, Ndovu Resources Limited, transferred a 50% interest in, and operatorship of, the Ruvuma PSA to ARA Petroleum Tanzania Limited ("APT"), a related party of the Group. The Group now holds a 25% interest in the Ruvuma PSA with a US$35.0 million carry through to potentially significant volumes of production.

 

A two-year licence extension, effective from 15 August 2021, was received over the Mtwara Licence in respect to the Ntorya Location. Although the extension was over the smaller Ntorya Location area, this was not considered an indicator of impairment as the area corresponded to the identified Ntorya asset development programme. During the two-year extension period the operator was committed to undertake acquiring 200 km² of 3D seismic (minimum expenditure of US$7.0 million), drill the Chikumbi-1 exploration well (minimum expenditure of US$15.0 million), complete the negotiation of the Gas Terms for the Ruvuma PSA with the TPDC and, using the data gathered from the Chikumbi-1 exploration and appraisal well and seismic acquisition, prepare and submit an application for a Development Licence for the Ntorya Location area. Although a second licence extension was requested in October 2022, this was superceded by a Development Licence application over the Ntorya gas discovery area submitted in January 2023. This was granted in May 2024 and therefore no impairment has been recognised against the Ruvuma PSA.

 

The Farm-Out secured funding for the next phase of development for the Ruvuma PSA CGU, for which the Group will be carried for its share up to US$35.0 million, equivalent to US$140.0 million gross field expenditure. The Carry balance as at 30 June 2024 was US$29.4 million (30 June 2023: US$30.1 million). There is a clear development plan for the asset outlined by the operator APT, with the support of the JV partners. During 2022, a 338 km² 3D seismic survey was completed and data processing and interpretation was completed in 2023. In June 2023 a Field Development Plan ("FDP") was approved.  

 

Nyuni Area PSA

 

Aminex fully provided for the Nyuni Area PSA exploration asset in 2018 following confirmation from the Tanzanian authorities that the Nyuni Licence period ended in October 2019, coupled with the communication from the Tanzania Ministry of Energy to withhold all work on the licence, pending a review of the Nyuni Area PSA. The Company was unable to progress the work programme and, therefore, the Directors concluded that the carrying cost of the Nyuni asset should be fully impaired. In April 2022 the Group commenced the process to hand back the licence to the Ministry. Subsequently, it was agreed with the Tanzanian authorities that the Group will continue its attempts to attract industry partners to participate in the licence. The likely outcome of these attempts however remains uncertain and consequently the Directors maintained their position of a full impairment over the Nyuni Area PSA CGU. Expenditure during the year is capitalised and then immediately impaired to the income statement as impairment against exploration and evaluation assets.

 

 

 

 

Aminex PLC

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

for the six months ended 30 June 2024

 

8.      Exploration and evaluation assets (continued)

 

Kiliwani South

 

The Kiliwani South CGU, located within the Kiliwani North Development Licence acreage, was previously identified as a potential lead. The Kiliwani South prospect was estimated by management to contain a mean 57 BCF un-risked GIIP and the prospect was reviewed by RPS in their February 2018 CPR.

 

During 2021, the Group proposed no work programme and allocated no budget towards the future development of the Kiliwani South CGU. This was due to no agreement reached with the Ministry of Energy on the work commitments over the Nyuni Area PSA and the delay to agreeing commercial terms on the Kiliwani North Development Licence. The Group previously considered any future drilling on the Licence would be dependent upon improved seismic resolution of the target structures that would result from the acquisition and interpretation of a 3D seismic survey, which would only be economic if conducted over both the KNDL and immediately adjacent areas within the Nyuni Area PSA. In line with the requirements of IFRS 6 this is an indicator of impairment. The Directors concluded in 2021 that the carrying value of the Kiliwani South asset should be fully impaired. Although a budget has been approved for 2024, this is for licence maintenance and support only, and the Directors concluded that full impairment should continue in 2023 and 2024. There was however no expenditure during the period. Any reversal of the impairment would be dependent on an established development programme for the area, including a seismic and drilling programme where an assessment of the carrying value of the CGU would be reviewed.

 

9.      Property, plant and equipment

		Development property - Tanzania	Other assets	Total
		US$'000	US$'000	US$'000
Cost
At 1 January 2024		8,453	88	8,541
Additions in the period		107	-	107
Disposals		-	-	-
Exchange rate adjustment		-	(1)	(1)
At 30 June 2024		8,560	87	8,647
Depreciation and depletion
At 1 January 2024		8,453	84	8,537
Charge for the period		-	1	1
Increase in impairment provision		107	-	107
Disposals		-	-	-
Exchange rate adjustment		-	(1)	(1)
At 30 June 2024		8,560	84	8,644
Net book value
At 30 June 2024		-	3	3
At 31 December 2023		-	4	4

 

 

 

 

Aminex PLC

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

for the six months ended 30 June 2024

 

9.      Property, plant and equipment (continued)

 

Development property - Tanzania

Following the award of the Kiliwani North Development Licence ("KNDL") by the Tanzanian Government in April 2011, the carrying cost relating to the development licence was reclassified as a development asset under property, plant and equipment, in line with accounting standards and the Group's accounting policies. Production from the Kiliwani North-1 well ("KN-1") commenced on 4 April 2016 and depletion was calculated with reference to the remaining reserves of 1.94 BCF, which were ascribed to the field as at 1 January 2018 in an independent reserves and resources report prepared by RPS in February 2018. The report also identified a contingent resource of 30.8 BCF in addition to the reserves. The well has produced approximately 6.4 BCF of gas to date. However, production from KN-1 in 2018 was intermittent and there has been no commercial production from the well since March 2018.

 

During 2021, although the Group and TPDC reached agreement on the settlement of past outstanding gas sales and related amounts due to the TPDC, certain rights were reserved by both parties over areas that remain unresolved related to commercial terms over production from the area (see Note 13). Any development of the KNDL requires prior agreement on commercial terms. During 2021, the KN-1 well remained idle, no progress was made with the TPDC on remediation of the well as discussions continued to focus on commercial terms over the Licence, and the Group proposed no work programme and allocated no budget over the KNDL for 2022. The Directors concluded in 2021 that these all indicated the asset was impaired.  

 

In accordance with IAS 36, the Group conducted an impairment test as at 31 December 2021 on a value-in-use basis. The cash-generating unit for the purpose of impairment testing is the KN-1 well. The Company uses a financial model of the forecast discounted cash flow to calculate the assets value-in-use. However, as key judgements for the 2021 impairment test concluded no production, the value in use calculation was US$nil.

 

Consequently, the Directors concluded that the Kiliwani North CGU was fully impaired as at 31 December 2021. These conditions and assessments have continued and therefore expenditures incurred during the financial period were capitalised and immediately impaired.

 

10.    Trade and other receivables

 

Trade and other receivables amounted to US$1.50 million at the period end (31 December 2023: US$1.59 million). The decrease is comprised mainly of a reduction in amounts due from joint operations partners of US$0.09 million.

 

11.    Cash and cash equivalents

 

	Unaudited 6 months ended 30 June  2024 US$'000		Unaudited 6 months ended 30 June  2023 US$'000		Audited  year ended 31 December 2023 US$'000
Cash at bank and in hand	1,778		5,036		3,041

 

Included in cash and cash equivalents is an amount of US$869,000 (31 December 2023: US$1,023,000) held on behalf of partners in jointly controlled operations. 

 

12.    Trade and other payables

 

Trade and other payables amounted to US$7.82 million at the period end (31 December 2023: US$8.19 million).  The decrease related predominantly to US$0.33 million in payments to the TRA for accrued VAT and WHT included in the 2019-2020 tax assessments and a reduction in amounts due to joint operations partners of US$0.15 million, offset by an increase of US$0.18 million in accrued training and licence fee invoices from the Petroleum Upstream Regulatory Authority in Tanzania. Included in trade and other payables for the Group are amounts due to partners in joint operations, VAT payable and amounts arising on gas sales.

 

The Directors consider that the carrying amounts of trade payables approximate their fair value.

 

Aminex PLC

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

for the six months ended 30 June 2024

 

13.    Commitments, guarantees and contingent liabilities

 

Commitments

 

In accordance with the relevant PSAs, Aminex has a commitment to contribute its share of the following outstanding work programmes:

 

(a)    Following the grant of the first extension to the Nyuni Area PSA, Tanzania, the terms of the licence require the acquisition of 700 kilometres of 3D seismic over the deep-water sector of the licence, and the drilling of four wells, on the continental shelf or in the deep-water, by October 2019. The Group commenced discussions in 2022 with the Tanzanian authorities to hand back the Nyuni Area licence which resulted in Aminex being requested to market the licence in 2023 in an attempt to find a third-party partner willing to pursue and fund a mutually agreed renegotiated work programme. It is acknowledged that only part of the seismic acquisition commitment and none of the drilling commitment under the licence has been undertaken.

 

(b)    The Ruvuma PSA, Tanzania, originally comprised two licences. Two wells are required to be drilled on the Mtwara Licence, one of which is expected to be the Chikumbi-1 well. The Mtwara Licence in respect of the Ntorya Location was extended in August 2021 for two years.  Pursuant to that extension, the joint operations parties are required to acquire 200 km² of 3D seismic over the location area, drill the Chikumbi-1 well and conclude negotiations of the Gas Terms for the Ruvuma PSA. The 3D seismic acquisition programme was completed on 9 October 2022 and the Addendum to the Ruvuma PSA, setting out the fiscal terms for the production of gas, was signed by all parties on 25 November 2022. The Development Licence over the Ntorya gas discovery area was granted in May 2024.

 

Guarantees and contingent liabilities

 

(a)    Under the terms of the Addendum to the Ruvuma PSA, Ndovu Resources Limited, a subsidiary company of Aminex PLC, has provided security to the TPDC for up to 15% of the profit share of the Kiliwani North Development Licence to guarantee the amended four-well drilling commitment under the Ruvuma PSA. For each well drilled the security interest will be reduced by 3% for the first well and 4% thereafter.

 

(b)    The Company guarantees certain liabilities and commitments of subsidiary companies from time to time, including the commitments of Ndovu Resources Limited under the Nyuni Area PSA. Management has assessed the possible outcomes of these liabilities and commitments in accordance with IFRS 9 and no material losses are expected to arise.

 

(c)     On 11 April 2018, Ndovu Resources Limited received formal notification from the TPDC of certain claims amounting to US$5.97 million against the Kiliwani North Development Licence with regard to unpaid royalties and amounts due under profit share arrangements. The agreed amounts claimed were offset as part of the settlement agreement signed in October 2021 between the Group and the TPDC. As part of the settlement agreement, both parties reserved certain rights including the TPDC reserving its rights in relation to unpaid royalties and profit share arrangements. Aminex has advised the TPDC that it does not accept the balance of the claims, which TPDC estimates to be US$4.18 million (Aminex's net share is equal to US$2.74 million). The Group has received legal advice in country that supports its position, and this has been provided to the TPDC. The Directors believe these claims are without merit and do not consider it appropriate at this stage to provide for these claims.

 

(d)    In 2022, as part of the share placement agreement with its broker, Shard Capital Partners LLP ("Shard"), the Company agreed to grant 5,320,666 warrants over new Ordinary Shares to Shard at an exercise price of Stg1.125pence per Ordinary Share ("Warrants"). It was agreed between the Company and Shard that the Warrants would not be issued until requested by Shard. No such request has been received by the Company to date and so the Warrants have not yet been granted to Shard.

 

 

 

 

 

 

 

 

Aminex PLC

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

for the six months ended 30 June 2024

 

13.    Commitments, guarantees and contingent liabilities (continued)

 

Tanzanian Tax Assessments

 

On 28 February 2020, following the conclusion of the TRA audit of Ndovu Resources Limited ("NRL"), the Group's Tanzanian wholly owned subsidiary, for taxation years 2013 to 2015, the TRA issued tax assessments in respect of these taxation years. The following matters were raised in the assessments:

 

		Principal		Interest		Total
		US$'000		US$'000		US$'000
Area
Withholding tax	Withholding tax on payments made to non-residents for services performed outside of Tanzania	242		182		424
VAT	Output VAT on imported services	191		156		347
Withholding tax	Withholding tax on deemed interest	797		664		1,461
		1,230		1,002		2,232

 

On 3 June 2022, following the conclusion of the TRA audit of NRL for taxation years 2016 to 2018, the TRA issued tax assessments in respect of these taxation years. The following material matters were raised in the assessments:

		Principal		Interest		Total
		US$'000		US$'000		US$'000
Area
VAT	VAT on Ruvuma Farm-Out	1,221		233		1,454
Pay As You Earn (PAYE)	PAYE on Director's fees	92		45		137
		1,313		278		1,591

 

On 28 June 2022, following the conclusion of the TRA corporate income tax audit of NRL for taxation years 2016 to 2018, the TRA issued tax assessments in respect of these taxation years. The following matters were raised in the assessments:

		Principal		Interest		Total
		US$'000		US$'000		US$'000
Area
Corporate tax	Under declaration of revenue for 2016	365		145		510
Corporate tax	Under declaration of revenue for 2017	1,438		394		1,832
Corporate tax	Under declaration of revenue for 2018	772		143		915
		2,575		682		3,257

 

NRL considers all the above claims to be without technical merit in tax law and with the assistance of an in-country tax advisor, has submitted objections to the assessments. At this stage it is unclear if these objections will be successful and therefore the amount or timing of potential cash outflow remains uncertain. Provision has been made for amounts NRL has ceded or where management determine the likelihood of success through the objection or appeals process is unlikely. There have been no developments on the above claims in 2024.

 

On 20 June 2023, following the conclusion of the TRA corporate income and other taxes audits of NRL for taxation years 2019 and 2020, the TRA issued tax assessments in respect of these taxation years. The corporate income tax assessments covered disallowance of costs, totalling US$760,000 for the two years, with no amounts due. The following material matters were raised in the assessments of other taxes:

 

		Principal		Interest		Total
		US$'000		US$'000		US$'000
Area
Withholding tax	WHT accrued not paid	1,062		181		1,243
Withholding tax	WHT on foreign services	357		57		414
VAT	VAT accrued not paid	358		-		358
VAT	VAT accrued not paid (Gas Sales Agreement)	920		-		920
Excise Duty	ED accrued not paid (Gas Sales Agreement)	297		-		297
		2,994		238		3,232

 

Aminex PLC

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

for the six months ended 30 June 2024

 

13.    Commitments, guarantees and contingent liabilities (continued)

 

The majority of these amounts were already accrued in the accounts of NRL. Objections were filed in July 2023 to some of the amounts but delays in receiving replies from the TRA led to the TRA rejecting these and eventually imposing an Instalment Plan ("IP") for monthly payments from October 2023 to October 2024 for 100% of the assessment amounts. Four payments were made up to January 2024 (US$ 1.10 million had been paid by 31 December 2023). In June 2024, a revised IP was agreed with monthly payments up to December 2025. In addition, NRL is currently formulating its response to the rejection of its filed objections. At this stage it is unclear whether NRL will be successful in its objections and therefore the amount or timing of potential cash outflow remains uncertain. Provision had been made at 31 December 2023 for interest on non-objected amounts, but all unpaid interest was subsequently waived by the TRA in June 2024 and the provisions released.

 

The claims detailed above total US$10.31 million, of which US$1.44 million has been paid and US$2.38 million has been accrued or provided for. Amounts accrued or provided for are included in Trade and other payables within WHT payable, VAT payable and Other payables.

 

14.    Related party transactions

 

There have been no material changes in the related party transactions affecting the financial position or the performance of the Group in the period since publication of the 2023 Annual Report.

 

15.    Post balance sheet events

        

There are no post balance sheet events to report.

 

16.    Statutory information

 

The financial information to 30 June 2024 and 30 June 2023 is unaudited and does not constitute statutory financial information.  The information given for the year ended 31 December 2023 does not constitute the statutory accounts within the meaning of Part 6, Chapter 4 of the Companies Act 2014.  The statutory accounts for the year ended 31 December 2023 have been filed with the Companies Registration Office in Ireland. This announcement will be made available at the Company's registered office at Paramount Court, Corrig Road, Sandyford Business Park, Dublin 18 and at the office of Aminex's UK subsidiary company, Aminex Petroleum Services Ltd., at 20-22 Wenlock Road, London, N1 7GU.

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact [e-mail] or visit www.rns.com.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our Privacy Policy.

 

END

 

 

IR SEDFDUELSEDU