We could not find any results for:
Make sure your spelling is correct or try broadening your search.
Customisable watchlists with full streaming quotes from leading exchanges, such as LSE, NASDAQ, NYSE, AMEX, Bovespa, BIT and more.
| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Elixir Pet. | LSE:ELP | London | Ordinary Share | AU000000EXR1 | ORD NPV |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 1.625 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
TIDMELP RNS Number : 8083O Elixir Petroleum Ltd 13 March 2009 ? Elixir Petroleum Limited (AIM : ELP) 13 March 2009 31 DECEMBER 2008 HALF - YEARLY FINANCIAL REPORT Elixir Petroleum Limited ("Elixir" or the "Company", AIM: ELP, ASX: EXR), the international oil and gas exploration and production company, provides the market with its 31 December 2008 Half-Yearly Financial Report. Results For the six month period to 31 December 2008, Elixir recorded Earnings Before Interest, Taxation, Depreciation and Amortisation (including impairment) and Exploration expenses ("EBITDAX") of $3,132,000 on sales of $4,197,000 (2007: EBITDAX of $1,334,000) and a consolidated after tax loss of $21,489,000 (2007: loss of $6,057,000). At the end of the period, Elixir held cash on hand of $12,531,000. As at the date of this announcement, Elixir holds cash on hand of approximately $9.8 million, following the repayment in January 2009 of $3.0 million of convertible loan notes. With the repayment of these notes, the Company is now debt free. Comment on Significant Non-Recurring Items The consolidated after tax loss for the period includes a number of non-cash, non-recurring or otherwise significant items totalling $24,689,000 million, as set out below. +---------------------------------+-------------------------------+ | $'000 | +-----------------------------------------------------------------+ | Exploration & Evaluation | (4,191) | | Expenses | | +---------------------------------+-------------------------------+ | Impairment of Oil & Gas | (12,918) | | Properties* | | +---------------------------------+-------------------------------+ | Depreciation, Depletion and | (7,580) | | Amortisation Expense* | | +---------------------------------+-------------------------------+ | Total | 24,689 | +---------------------------------+-------------------------------+ * - Non-cash expense items Exploration & Evaluation Expense A significant component of the Exploration and Evaluation Expense recognised during the period relates to the drilling of Well #3 at the Pompano project. The well has been temporarily suspended whilst a detailed evaluation of data is undertaken before a decision is made as to whether to complete the well or utilise it as a sidetrack candidate for future drilling targets. Notwithstanding this, it was considered prudent by the Board to expense these costs in the period under review. Impairment of Oil & Gas Properties Upon completion of the merger between Elixir and Gawler Resources Limited in late 2007, applicable Accounting Standards required the share based purchase consideration paid by Elixir to Gawler shareholders and option holders to be valued at $0.365 per share and $0.364 per option. The majority of the value of the share based consideration was required to be apportioned to Gawler's producing oil and gas properties in the Gulf of Mexico, being the Pompano Project and the High Island Project. As at 30 June 2008, the carrying value for accounting purposes of these properties was $31,569,000. In the period to 31 December 2008, following significant declines in commodity prices, Elixir's market capitalisation and other factors, applicable Accounting Standards have now required that an impairment provision be recognised to reduce the carrying values of Elixir's Gulf of Mexico projects. The revised carrying values do not in the opinion of the Board necessarily reflect the potential value that these assets would hold in an improved commodity price environment. Depreciation, Amortisation & Depletion The Depreciation, Amortisation and Depletion charge which has been recognised in the 6 month period to 31 December 2008 is based on the estimated depletion of reserves through production during that period. Due to the historically high share based carrying value of the Gulf of Mexico producing properties, the charge that has been recognised is significant at $7,580,000. The cost base of these properties for accounting purposes has as a result of the impairment described above been reduced to $11,106,000. Consequently, the charge in respect of Depreciation, Amortisation and Depletion is expected to be substantially less in the second half of the current period and in future periods. Yours faithfully, ELIXIR PETROLEUM LIMITED Andrew Ross Managing Director This report contains some references to forward looking assumptions, estimates and outcomes. These are uncertain by nature and no assurance can be given by Elixir that its expectations, estimates and forecast outcomes will be achieved. Information contained in this report with respect to the High Island and Pompano Projects, was compiled by Elixir, or from material provided by the project operators, and reviewed by I L Lusted, BSc (Hons),SPE , who has had more than 15 years experience in the practice of petroleum engineering. Mr Lusted consents to the inclusion in this report of the information in the form and context in which it appears. +----------------------------------------+----------------------------------------+ | For further information, please visit the Company's website at | | www.elixirpetroleum.com, or contact: | +---------------------------------------------------------------------------------+ | Elixir Petroleum Limited | Blue Oar Securities Plc | | Alex Neuling | Jerry Keen / Olly Cairns | | Tel: (+61) 8 9440 2650 | Tel: (+44) 207 448 4400 / (+61) 8 6430 | | | 1631 | | | | +----------------------------------------+ + | Conduit PR | | | Jonathan Charles / Sarah Alexander | | | Tel: (+44) 207 429 6666 | | +----------------------------------------+----------------------------------------+ +----------------------+-------------------------------------------------------------+ | | | +----------------------+-------------------------------------------------------------+ | ABN 51 108 230 995 | +------------------------------------------------------------------------------------+ | Elixir Petroleum | Interim Financial Report for the half-year ended | | | 31 December 2008 | | | | +----------------------+-------------------------------------------------------------+ | | | +----------------------+-------------------------------------------------------------+ +----------------------------------------------+---------------------------+ | | Page | +----------------------------------------------+---------------------------+ | Corporate Directory | 1 | +----------------------------------------------+---------------------------+ | Directors' report | 2 | +----------------------------------------------+---------------------------+ | Auditors' independence declaration | 8 | +----------------------------------------------+---------------------------+ | Independent review report | 9 | +----------------------------------------------+---------------------------+ | Directors' declaration | 10 | +----------------------------------------------+---------------------------+ | Consolidated income statement | 11 | +----------------------------------------------+---------------------------+ | Consolidated balance sheet | 12 | +----------------------------------------------+---------------------------+ | Consolidated statement of changes in equity | 13 | +----------------------------------------------+---------------------------+ | Consolidated cash flow statement | 14 | +----------------------------------------------+---------------------------+ | Notes to the financial statements | 15 | +----------------------------------------------+---------------------------+ +---------------------------------------+--+------------------------------------+ | Directors | | Share Registry | | Mr Jonathan Stewart - Executive | | Computershare Investor Services | | Chairman | | Pty Ltd | | Mr Andrew Ross - Managing Director | | Level 2 | | Mr Iain Knott - Executive Director, | | 45 St Georges Terrace | | Exploration | | Perth WA 6000 | | Mr Trevor Benson - Non-Executive | | Computershare Investor Services | | Director | | plc | | Mr John Robertson - Non-Executive | | The Pavilions | | Director | | Bridgwater Road | | Company Secretary | | Bristol BS99 7NH | | Mr Alex Neuling | | Bankers | | Registered and Principal | | National Australia Bank Limited | | Administration Office | | Ground Floor, 50 St Georges | | Level 20, 77 St Georges Terrace | | Terrace | | Perth, Western Australia 6000 | | PerthWA 6000 | | Telephone:(+61) 8 9440 2626 | | Barclays Bank plc | | Facsimile: (+61) 8 9440 2699 | | 5 The North Colonnade | | UK Office | | Canary Wharf | | 8 The Courtyard | | London E14 4BB | | Eastern Road, Bracknell | | Stock Exchange Listing | | Berkshire RG12 8XB | | Australian Stock Exchange | | United Kingdom | | Home Exchange: Perth, Western | | Telephone: (+44) 207 484 5019 | | Australia | | Facsimile: (+44) 207 484 4992 | | Code: EXR | | Auditors | | AIM Market, London Stock Exchange | | Mack & Co | | Code: ELP | | Level 2, 35 Havelock Street | | Website | | West Perth WA 6005 | | www.elixirpetroleum.com | | | | Email | | | | info@elixirpetroleum.com | +---------------------------------------+--+------------------------------------+ Directors' Report The Directors of Elixir Petroleum Limited present their report on the Consolidated Entity consisting of Elixir Petroleum Limited ("the Company" or "Elixir") and the entities it controlled during the half-year ended 31 December 2008 ("Consolidated Entity" or "Group"). Directors The names of the Directors of Elixir Petroleum Limited in office during the half-year and until the date of this report are: Mr Jonathan Stewart (Executive Chairman) Mr Andrew Ross (Managing Director) Mr Iain Knott (Executive Director - Exploration) Mr Trevor Benson (Non-Executive Director) Mr John Robertson (Non-Executive Director) All Directors were in office from the beginning of the half-year until the date of this report. Review and Results of Operations Operating Results The Company recorded EBITDAX of $3,132,000 and a net after tax loss of $21,489,000 for the half-year ended 31 December 2008 (half-year to 31 December 2007: EBITDAX of $1,334,000 and a net loss of $6,057,000). Summary Review of Operations During the half-year ended 31 December 2008, the Company conducted oil and gas operations offshore the Texas Coast in the Gulf of Mexico, in the UK North Sea and offshore the Republic of Sierra Leone. DEVELOPMENT & PRODUCTION INTERESTS Gulf of Mexico Project Name:High Island Project (Block 268A) Location:High Island Area, Offshore Texas, USA Ownership:30% Working Interest (22.5% Net Revenue Interest) Operator: Peregrine Oil and Gas, LP The High Island field is located approximately 65 kilometres southeast of Houston, Texas in the Gulf of Mexico and was brought into production in September 2007. Wells A-1 and A-2 at High Island discovered gas and condensate pay in two separate accumulations, with each well currently producing from only the lower of the two reservoir zones. The High Island field was shut-in during the passage of Hurricanes Gustaf and Ike in early and mid-September 2008 respectively. The High Island facilities suffered only superficial damage as a result of the passage of the hurricanes, but the High Island Offshore System ("HIOS"), a regional pipeline system into which production from High Island is ultimately transported to shore, was severed preventing production from being re-instated at High Island. Repairs to the HIOS were completed in late December 2008 and the pipeline was re-commissioned and in operation in early January 2009. Wells A-1 and A-2 at High Island were brought back into production from 5 January 2009, with stabilised flow rates having been achieved by the end of January. At the date of this report, Well A-1 is producing approximately 0.3 million standard cubic feet of gas per day ("MMscf/d") and 4 barrels of condensate per day ("bocd") and Well A-2 is producing approximately 4.5 MMscf/d and 10 bocd. In the six month period to 31 December 2008, the following production results were achieved at High Island: +---------+---------+-----------+-----------+-----------+--------+--------+-----------+----------+----------+--------+ | High | Gas | Oil | | Island | Production | Production | | Field - | | | | 268-A | | | + +------------------------------------------------------+---------------------------------------------------+ | | Total | Total | Avg | Avg |Change | Total | Total | Avg | Avg |Change | | | Dec |June Half | Daily | Daily | (%) | Dec |June Half | Daily | Daily | (%) | | | Half | (MMscf) | Dec | June | | Half | (Bbls) | Dec | June | | | |(MMscf) | | Half | Half | |(Bbls) | | Half | Half | | | | | |(MMscf/d) |(MMscf/d) | | | |(Bbls/d) |(Bbls/d) | | +---------+---------+-----------+-----------+-----------+--------+--------+-----------+----------+----------+--------+ | Project | 280.8 | 1,167 | 1.53 | 6.4 | -76 |10,711 | 50,312 | 59 | 276 | -79 | | (100%) | | | | | | | | | | | +---------+---------+-----------+-----------+-----------+--------+--------+-----------+----------+----------+--------+ | Elixir | 84.2 | 350.3 | 0.46 | 1.9 | -76 | 3,213 | 15,094 | 18 | 83 | -79 | | (30% | | | | | | | | | | | | WI) | | | | | | | | | | | +---------+---------+-----------+-----------+-----------+--------+--------+-----------+----------+----------+--------+ If the extended shut-in period for Wells A-1 and A-2 are excluded from the results above, a decline in gas production of approximately 21.5% for the period would have been observed relative to the production results obtained for the June 2008 half-year. Production receipts from High Island for the half year to 31 December 2008 totalled approximately US$1.80 million. The average price realised for the sale of gas produced in these months was US$11.12/Mcf, and for oil was US$127.63/Bbl. There were approximately 128 days downtime during the reporting period, of which 124 were as a result of the passage of Hurricanes Gustaf and Ike, and the subsequent shut-in of the HIOS pipeline system for repairs. Excluding these events, the platform achieved an average uptime of 93% for the period. There were no reported safety incidents in the period. One positive from the prolonged shut-in of wells A-1 and A-2 was the sourcing of data to assist with ongoing reservoir management. Project Name:Pompano Gas Project (Block 446-L SE/4) Location:Brazos Area, Offshore Texas, USA Ownership: 25% Working Interest (18.125% Net Revenue Interest) Operator: AnaTexas Offshore Inc. The Pompano gas field lies in the Gulf of Mexico approximately 150 kilometres southwest of Houston, Texas. Well #1 at Pompano was directionally drilled from a new caisson installed adjacent to the field's existing "B" satellite platform and was placed on production in March 2008. Well #2 at Pompano was drilled from a caisson adjacent to the existing main processing facility, the "A" platform, and was placed on production in May 2008. Well #3 at Pompano spudded in late September 2008 and encountered potentially commercial sands in one horizon, with the deeper sand targets being wet. Well #3 was temporarily suspended pending a detailed review of data before a decision is made as to whether to complete the well over the 6700 ft Sands or to use the well bore as a sidetrack candidate for future drilling targets. At the date of this report, Well #1 is producing approximately 0.2 MMscf/d and Well #2 is producing approximately 4.7 MMscf/d and negligible condensate production per day. In the six month period to 31 December 2008, the following production results were achieved at Pompano: +---------+---------+---------+-----------+-----------+--------+--------+--------+----------+----------+--------+ | Pompano | Gas | Oil | | Field | Production | Production | | Brazos | | | | Block | | | | 446-L | | | + +----------------------------------------------------+------------------------------------------------+ | | Total | Total | Avg | Avg |Change | Total | Total | Avg | Avg |Change | | | Dec | June | Daily | Daily | (%)* | Dec | June | Daily | Daily | (%)* | | | Half | Half | Dec | June | | Half | Half | Dec | June | | | |(MMscf) |(MMscf) | Half | Half | |(Bbls) |(Bbls) | Half | Half | | | | | |(MMscf/d) |(MMscf/d) | | | |(Bbls/d) |(Bbls/d) | | +---------+---------+---------+-----------+-----------+--------+--------+--------+----------+----------+--------+ | Project | 1,501 | 1,178 | 8.2 | 10.5 | -22 | 971 | 3,650 | 5 | 33 | -84 | | (100%) | | | | | | | | | | | +---------+---------+---------+-----------+-----------+--------+--------+--------+----------+----------+--------+ | Elixir | 375.3 | 294.5 | 2.0 | 2.6 | -22 | 243 | 912 | 1 | 8 | -84 | | (25% | | | | | | | | | | | | WI) | | | | | | | | | | | +---------+---------+---------+-----------+-----------+--------+--------+--------+----------+----------+--------+ * Based on Average daily production rates across total days in the respective periods Production from Well #1 was restricted in the period due to sand forming bridges in the short production string which produces from the 6700 ft Sand. Water and sand production has also affected gas rates in the long production string which produces from the B Sand. The water is believed to be originating from the deeper B2 Sand and is channelling up to the B Sand through a leak path in the annulus cement. It is expected that a well intervention operation will be conducted in the coming quarter which will seek to remedy these issues with a view to increasing production from Well #1. Well #2 continues to produce in accordance with expectations. Production receipts from Pompano for the half year to 31 December 2008 totalled approximately US$3.17 million. The average price realised for the sale of gas produced in these months was US$10.98/Mcf, and for oil was US$120.13/Bbl. There were approximately 11.6 days downtime during the reporting period, of which 6.7 were as a result of the passage of Hurricane's Gustaf and Ike. Excluding these events, the platform achieved an average uptime of 97% for the period. Despite the passage of two major hurricanes and well operations with the drilling of Well#3, there were no reported safety incidents in the period. APPRAISAL UK North Sea Project Name:Mulle Prospect (Block 211/22b and 211/27d) Location: Northern UK North Sea Ownership: 40% Working Interest Operator: DNO (UK) Limited The Mulle accumulation lies in Block 211/22b on the south-western extension of the Osprey Ridge and is adjacent to the proposed Causeway oil field development. Elixir's wholly-owned UK subsidiary, Elixir Petroleum (Europe) Limited ("E(EU)") holds a 40% working interest in the Block. The operator of Block 211/22b, DNO (UK) Limited, has published a most likely contingent resource estimate for Mulle of 18 million barrels of oil. This equates to a most likely net contingent recoverable oil resource to E(EU) of almost 7 million barrels. In November 2008, the Mulle joint venture was notified that it had been successful in bidding for Block 211/27d in the UKCS 25th Seaward Licensing Round. Block 211/27d contains a mapped southern extension to the Mulle field, and it is likely that this will result in a modest increase to the resource estimate for the field. The joint venture has developed an appraisal and testing programme for the Mulle accumulation and is seeking a further partner, or partners, to enter the Block to assist with the funding of the programme. To that end, an online data room in respect of the Mulle accumulation was open during the December quarter and attracted an encouraging level of interest from industry participants. The data room closed at year end and the joint venture partners are in discussions with several parties concerning the project. EXPLORATION UK North Sea Project Name:Tiger Prospect (Block 211/12b) Location: Northern UK North Sea Ownership: 100% Working Interest Operator: Elixir Petroleum (Europe) Limited ("E(EU)") In November 2008, E(EU) was notified that it had been awarded Block 211/12b in the UKCS 25th Seaward Licensing Round. The Block is located in the northern sector of the UK North Sea, approximately 140 kilometres north east of the Shetland Islands, in a water depth of approximately 125 metres. Block 211/12b contains a newly mapped prospect named 'Tiger'. The Block lies 5 kilometres to the east of the Magnus Field which was brought into production in 1983 by BP with an in-place volume of approximately 1.5 billion barrels of oil. The target reservoir in the Tiger prospect is the Magnus Sandstone Member, over 500 feet of which was encountered in Well 211/12b-15, which was drilled down dip of the Tiger prospect in 1992. The equivalent sands in the nearby Magnus Field have excellent porosity and permeability characteristics. Evidence from the 211/12b-15 well also indicates the presence of a nearby hydrocarbon column. Reservoir presence and hydrocarbon charge for the Tiger prospect are considered to be low risk. Elixir has finalised the forward work programme for 2009, which has now commenced. The Block has been awarded for a licence term of 4 years with a drill or drop decision required at the end of year 3. Project Name:Leopard Prospect (Block 211/18b) Location: Northern UK North Sea Ownership: 56% Working Interest Operator: Elixir Petroleum (Europe) Limited ("E(EU)") Block 211/18b (Licence P1381) is a traditional licence awarded in the 23rd UKCS Seaward Licensing Round in December 2005. As announced in December 2008, a four month extension to the original licence term of the Block has been obtained from the UK regulator. Efforts to secure another farminee for the proposed Leopard well are ongoing with several companies currently assessing the opportunity. The recent Cladhan discovery well drilled in the northern UK North Sea, which also targeted Upper Jurassic sandstones in a stratigraphically controlled play type (similar to the Leopard Prospect), further supports the viability of Upper Jurassic plays in the region and substantially de-risks the Leopard Prospect. We believe the Cladhan discovery, together with the updated geobody studies undertaken by E(EU) in the second half of 2008, has upgraded the Leopard Prospect and we remain hopeful that despite a more difficult farmout market, E(EU) will secure an additional farmin partner prior to the expiry of the licence. Gulf of Mexico Project Name:Red Fish Prospect (Block 479-L, N/2 and NE/4) Location:Brazos Area, Offshore Texas, USA Ownership:25% Working Interest (18.125% Net Revenue Interest) Operator: AnaTexas Offshore Inc. During the period under review, the Red Fish lease was awarded to the Pompano joint venture participants. Work continues to evaluate the opportunities within the lease area and Elixir is currently considering participation in two further extensions of the Red Fish area. West Africa - Sierra Leone Project Name:Block SL-4 Location: Offshore Sierra Leone Ownership: 100% Working Interest Operator: Elixir Petroleum (UK) Limited ("E(UK)") Block SL-4 comprises an area of 4,429 km2 lying in water depths from 100m to over 3,500m offshore Sierra Leone, West Africa. An interest in Block SL-4 was assigned to E(UK) in February 2008. At that time, E(UK) was also approved as operator of the licence. The acquisition of a 1,222 km2 3D seismic survey over the Block was completed by TGS-Nopec in early June 2008 with processing of the dataset completed in November 2008. As previously announced, E(UK)'s joint venture partner in Block SL-4, Prontinal Limited, has failed to meet its payment obligations under the various contractual arrangements between the parties, including payment of amounts found to be owing to TGS-Nopec in respect of the seismic acquisition. As a result, E(UK) placed Prontinal in default in late September 2008. Prontinal failed to remedy its default in payment of the outstanding joint venture expenses within the required timeframe. E(UK) therefore notified Prontinal in early December of the forfeiture of its interest in Block SL-4 to E(UK). E(UK) has subsequently commenced legal proceedings in the British Virgin Islands seeking recovery from Prontinal of monies owed to E(UK). A hearing date in relation to this matter has been set for mid-March 2009. E(UK) received in mid-December a statutory demand for payment in the amount of approximately US$2.6 million from TGS-Nopec in respect of the seismic acquisition over Block SL-4. E(UK) addressed this issue with TGS-Nopec's solicitors and reached an agreement that recovery proceedings be suspended against the Company. In early March 2009, a Notice of Arbitration was received from TGS-Nopec concerning the seismic acquisition programme on Block SL-4. The arbitration is seeking payment in an amount of US$9.3 million and names E(UK) as a co-Respondent with Prontinal Limited. E(UK) is currently seeking advice from its legal counsel in relation to the arbitration, but intends to vigorously defend its position. It remains the view of the E(UK) that E(UK)'s joint venture partner in Block SL-4, Prontinal Limited, remains responsible for payment of any amounts found to be due to TGS-Nopec in respect of the 3D acquisition and processing. Information contained in this report with respect to the High Island and Pompano Projects and the Red Fish Prospect, was compiled by Elixir, or from material provided by the project operators, and reviewed by I L Lusted, BSc (Hons),SPE , who has had more than 15 years experience in the practice of petroleum engineering. Mr Lusted consents to the inclusion in this report of the information in the form and context in which it appears. Information contained in this report with respect to the UK North Sea Projects and Block SL-4 offshore Sierra Leone, was compiled by Elixir or from material provided by the project operators and reviewed by the Elixir's Exploration Director, Iain Knott, BSc, MSc, FGS, AAPG, who has had more than 25 years experience in the practice of geology, including more than 5 years experience in petroleum geology. Mr Knott consents to the inclusion in this report of the information in the form and context in which it appears. MINERAL ASSETS In December 2008, Elixir elected not to renew the mineral licences in relation to the Roxby Project and the Pine Row Project, both located in South Australia. Elixir continued to market its in the period its remaining two mineral asset licences which are located in the Northern Territory. Discussions have been held with a number of parties with respect to a possible sale or farm-out of the licence interests which are prospective for uranium, but to date no offers have been forthcoming. Corporate In late May 2008, Elixir announced a fundraising at $0.27 per share which involved the placement of new shares and an underwritten rights issue to raise up to $14.5 million before costs. Due to adverse market conditions resulting in significant declines in relevant ASX indices just prior to the close of the offer in late June 2008, in accordance with its terms of engagement, the underwriter elected to terminate the underwriting arrangements. As a result of this termination and the limited take-up of the rights issue by shareholders, the total funds raised amounted to $7.52 million before costs. As a consequence of the fundraising, 27,870,550 new fully paid ordinary shares in the Company were issued and admitted to trading on the ASX and AIM in July 2008. In June 2008, shareholders approved the establishment of the Elixir Employee Share Option Plan for the incentivisation of the Company's management. Pursuant to the terms of that approval and the rules of the Plan, 8,000,000 unlisted options in the Company were issued and allotted to directors of the Company in July 2008. The Company held its fourth annual general meeting since its listing on the ASX in 2004 on Monday, 24 November 2008 at Level 31, 77 St. Georges Terrace, Perth Western Australia. Both resolutions put to the meeting were passed without amendment. At 31 December 2008, Elixir held cash on hand of approximately $12.5 million (half-year to 30 June 2008: $10.6 million). During January 2009, the Company repaid on their expiry $3.0 million in convertible loan notes. With the repayment of these notes, the Elixir Group is debt free. Auditor's Independence Declaration The Auditor's independence declaration is included on page 8 of the half-year financial report. Rounding of Amounts to the Nearest Thousand Dollars The company satisfies the requirements of Class Order 98/0100 issued by the Australian Investments and Securities Commission relating to "rounding off" of amounts in the Directors' Report and the Financial Report to the nearest thousand dollars. Amounts have been rounded off in the Directors' Report and Financial Report in accordance with that Class Order. Signed in accordance with a resolution of the Directors made pursuant to s.306 (3) of the Corporations Act 2001. On behalf of the Directors JONATHAN STEWART Chairman Houston, Texas 12 March 2009 Auditors' Independence Declaration Under Section 307C of the Corporations Act 2001 To the Directors of Elixir petroleum Limited I declare that to the best of my knowledge and belief, during the half year ended 31 December 2008 there have been: a. no contraventions of the auditor independence requirements as set out in the Corporations Act 2001 inrelation to the review; and
b. no contraventions of any applicable code of professional conduct in relation to the review. _____________________________ ______________________________ Mack & CoN.A Calder, Partner Chartered Accountants 2nd Floor, 35 Havelock Street West Perth WA 6005 ______________________________ Date Auditors' Independent Review Report TO THE MEMBERS OF ELIXIR PETROLEUM LIMITED Report on the Half year Financial Report We have reviewed the half year financial report of Elixir Petroleum Limited (company) and Controlled Entities (the consolidated entity) which comprises the balance sheet as at 31 December 2008, and the income statement, statement of changes in equity and cash flow statement for the half year ended on that date, a statement of accounting policies, other selected explanatory notes and the directors' declaration of the consolidated entity comprising the company and the entities it controlled at the half year end or from the time during the half year. Director's Responsibility for the Half year Financial Report The directors of the company are responsible for the preparation and fair presentation of the half year financial report in accordance with the Australian Accounting Standards (including the Australian Accounting Interpretations) and the Corporations Act 2001. This responsibility includes designing, implementing and maintaining internal control relevant to the preparation and fair presentation of the half year financial report that is free from material misstatement, whether due to fraud or error; selecting and applying appropriate accounting policies; and making accounting estimates that are reasonable in the circumstances. Auditor's Responsibility Our responsibility is to express a conclusion on the half year financial report based on our review. Our review has been conducted in accordance with Auditing Standards on Review Engagements ASRE 2410 Review on an Interim Financial Report Performed by the Independent Auditor of the Entity, in order to state whether, on the basis of the procedures described, we have become aware of any matter that makes us believe that the financial report is not in accordance with the Corporations Act 2001 including: giving a true and fair view of the consolidated entity's financial position as at 31 December 2008 and its performance for the half year ended on that date; and complying with Accounting Standard AASB 134 Interim Financial Reporting, the Corporation Regulations 2001, and other mandatory financial reporting requirements in Australia. As the auditor of Elixir Petroleum Limited and Controlled Entities, ASRE 2410 requires that we comply with the ethical requirements relevant to the audit of the annual financial report. A review of a half year financial report consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with Australian Auditing Standards and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion. Independence In conducting our review, we have complied with the independence requirements of the Corporations Act 2001. Conclusion Based on our review, which is not an audit, we have not become aware of any matter that makes us believe that the half year financial report of Elixir Petroleum Limited and Controlled Entities is not in accordance with the Corporations Act 2001 including: A. giving a true and fair view of the consolidated entity's financial position as at 31 December 2008 and of its performancefor the half
year ended on that date; and B. complying with Accounting Standard AASB 134 Interim Financial Reporting and Corporations Regulations 2001. _____________________________ ______________________________ Mack & Co N.A Calder, Partner Chartered Accountants 2nd Floor, 35 Havelock Street West Perth WA 6005 ___________________________ date Directors' Declaration The Directors declare that: (a) The financial statements of the consolidated entity and notes thereto are in accordance with the Corporations Act 2001, and i. give a true and fair view of the consolidated entity's financial position as at 31 December 2008 and of itsperformance for the half-year ended on
that date; and ii. comply with Accounting Standard AASB 134 "Interim Financial Reporting" and the CorporationsRegulations 2001; and
(b) in the Directors' opinion there are reasonable grounds to believe that the Company will be able to pay its debts as when they become due and payable. This declaration is signed in accordance with a resolution of the Directors made pursuant to s.303(5) of the Corporations Act 2001. On behalf of the Directors Jonathan Stewart Chairman Houston, Texas 12 March 2009 Consolidated Income Statement for the half-year ended 31 December 2008 +----------------+--------+--------------+--------+-----------+ | | | Consolidated | | | | | +----------------+--------+-----------------------------------+ | | Note | 2008 | | 2007 | +----------------+--------+--------------+--------+-----------+ | | | $'000 | | $'000 | +----------------+--------+--------------+--------+-----------+ | | | | | | +----------------+--------+--------------+--------+-----------+ | Revenue | | 4,197 | | 2,999 | | from | | | | | | oil & | | | | | | gas | | | | | | sales | | | | | +----------------+--------+--------------+--------+-----------+ | Other | (2) | 1,568 | | - | | income | | | | | +----------------+--------+--------------+--------+-----------+ | | | | | | +----------------+--------+--------------+--------+-----------+ | Operating | | (726) | | (38) | | and | | | | | | production | | | | | | costs | | | | | +----------------+--------+--------------+--------+-----------+ | General | | (1,907) | | (1,627) | | & | | | | | | administrative | | | | | | costs | | | | | +----------------+--------+--------------+--------+-----------+ | | | | | | +----------------+--------+--------------+--------+-----------+ | EBITDAX1 | | 3,132 | | 1,334 | +----------------+--------+--------------+--------+-----------+ | | | | | | +----------------+--------+--------------+--------+-----------+ | Depreciation, | (2) | (7,580) | | (5,817) | | depletion and | | | | | | amortisation | | | | | | expense | | | | | +----------------+--------+--------------+--------+-----------+ | Exploration | (2) | (4,191) | | (1,292) | | & | | | | | | evaluation | | | | | | expense | | | | | +----------------+--------+--------------+--------+-----------+ | Impairment | (2) | (12,918) | | - | | expense | | | | | +----------------+--------+--------------+--------+-----------+ | | | | | | +----------------+--------+--------------+--------+-----------+ | EBIT2 | | (21,557) | | (5,775) | +----------------+--------+--------------+--------+-----------+ | | | | | | +----------------+--------+--------------+--------+-----------+ | Finance | | 219 | | - | | income | | | | | +----------------+--------+--------------+--------+-----------+ | Finance | | (151) | | (282) | | costs | | | | | +----------------+--------+--------------+--------+-----------+ | | | | | | +----------------+--------+--------------+--------+-----------+ | Loss | (2) | (21,489) | | (6,057) | | before | | | | | | income | | | | | | tax | | | | | +----------------+--------+--------------+--------+-----------+ | | | | | | +----------------+--------+--------------+--------+-----------+ | Income | | - | | - | | tax | | | | | | expense | | | | | | / | | | | | | benefit | | | | | +----------------+--------+--------------+--------+-----------+ | | | | | | +----------------+--------+--------------+--------+-----------+ | Net | | (21,489) | | (6,057) | | loss | | | | | | attributable | | | | | | to members | | | | | | of Company | | | | | +----------------+--------+--------------+--------+-----------+ | | | | | | +----------------+--------+--------------+--------+-----------+ | Earnings | | | | | | / (loss) | | | | | | per | | | | | | share | | | | | +----------------+--------+--------------+--------+-----------+ | | | | | | +----------------+--------+--------------+--------+-----------+ | Basic | | (11.4) | | (6.5) | | loss | | | | | | per | | | | | | share | | | | | | (cents | | | | | | per | | | | | | share) | | | | | +----------------+--------+--------------+--------+-----------+ | | | | | | +----------------+--------+--------------+--------+-----------+ | Diluted | | (11.4) | | (6.5) | | loss | | | | | | per | | | | | | share | | | | | | (cents | | | | | | per | | | | | | share) | | | | | +----------------+--------+--------------+--------+-----------+ The above income statement should be read in conjunction with the accompanying notes. 1 EBITDAX: Earnings before Interest, Tax, Depreciation, depletion and amortisation (including impairment expense), Exploration & evaluation expense. 2 EBIT: Earnings before Interest and Tax. Consolidated Balance Sheet as at 31 December 2008 +-------------+--------+------------+--------+------------+ | | | Consolidated | +-------------+--------+----------------------------------+ | | Note | 31-Dec-08 | | 30-Jun-08 | +-------------+--------+------------+--------+------------+ | | | $'000 | | $'000 | +-------------+--------+------------+--------+------------+ | Assets | | | | | +-------------+--------+------------+--------+------------+ | | | | | | +-------------+--------+------------+--------+------------+ | Current | | | | | | assets | | | | | +-------------+--------+------------+--------+------------+ | Cash | | 12,531 | | 10,604 | | and | | | | | | cash | | | | | | equivalents | | | | | +-------------+--------+------------+--------+------------+ | Trade | | 1,525 | | 3,670 | | and | | | | | | other | | | | | | receivables | | | | | +-------------+--------+------------+--------+------------+ | Total | | 14,056 | | 14,274 | | current | | | | | | assets | | | | | +-------------+--------+------------+--------+------------+ | | | | | | +-------------+--------+------------+--------+------------+ | Non-current | | | | | | assets | | | | | +-------------+--------+------------+--------+------------+ | Receivables | | 361 | | - | +-------------+--------+------------+--------+------------+ | Oil & | (4) | 11,105 | | 31,569 | | Gas | | | | | | Properties | | | | | +-------------+--------+------------+--------+------------+ | Other | | 82 | | 10 | | plant | | | | | | and | | | | | | equipment | | | | | +-------------+--------+------------+--------+------------+ | Deferred | 1,254 | | 1,286 | | exploration, | | | | | evaluation and | | | | | development | | | | | expenditure | | | | +----------------------+------------+--------+------------+ | Total | | 12,803 | | 32,865 | | non-current | | | | | | assets | | | | | +-------------+--------+------------+--------+------------+ | | | | | | +-------------+--------+------------+--------+------------+ | Total | | 26,858 | | 47,139 | | assets | | | | | +-------------+--------+------------+--------+------------+ | | | | | | +-------------+--------+------------+--------+------------+ | Liabilities | | | | | +-------------+--------+------------+--------+------------+ | | | | | | +-------------+--------+------------+--------+------------+ | Current | | | | | | liabilities | | | | | +-------------+--------+------------+--------+------------+ | Trade | | (1,716) | | (2,983) | | and | | | | | | other | | | | | | payables | | | | | +-------------+--------+------------+--------+------------+ | Borrowings | | (3,000) | | (3,000) | +-------------+--------+------------+--------+------------+ | Total | | (4,716) | | (5,983) | | current | | | | | | liabilities | | | | | +-------------+--------+------------+--------+------------+ | | | | | | +-------------+--------+------------+--------+------------+ | Non-current | | | | | | liabilities | | | | | +-------------+--------+------------+--------+------------+ | Provisions | | (1,484) | | (1,484) | +-------------+--------+------------+--------+------------+ | Total | | (1,484) | | (1,484) | | non-current | | | | | | liabilities | | | | | +-------------+--------+------------+--------+------------+ | | | | | | +-------------+--------+------------+--------+------------+ | Total | | (6,200) | | (7,467) | | liabilities | | | | | +-------------+--------+------------+--------+------------+ | | | | | | +-------------+--------+------------+--------+------------+ | Net | | 20,659 | | 39,672 | | assets | | | | | +-------------+--------+------------+--------+------------+ | | | | | | +-------------+--------+------------+--------+------------+ | Equity | | | | | +-------------+--------+------------+--------+------------+ | | | | | | +-------------+--------+------------+--------+------------+ | Contributed | (7) | 60,644 | | 58,609 | | equity | | | | | +-------------+--------+------------+--------+------------+ | Reserves | | 1,904 | | 1,464 | +-------------+--------+------------+--------+------------+ | Accumulated | | (41,889) | | (20,400) | | losses | | | | | +-------------+--------+------------+--------+------------+ | | | | | | +-------------+--------+------------+--------+------------+ | Total | | 20,659 | | 39,672 | | parent | | | | | | entity | | | | | | interest | | | | | | in | | | | | | equity | | | | | +-------------+--------+------------+--------+------------+ The above balance sheet should be read in conjunction with the accompanying notes. Consolidated Statement of changes in equity for the half-year ended 31 December 2008 +-------------+--------+--------+------------+--------+------------+ | | | | Consolidated | +-------------+--------+--------+----------------------------------+ | | Note | 2008 | | 2007 | +-------------+-----------------+------------+--------+------------+ | | | | $'000 | | $'000 | +-------------+--------+--------+------------+--------+------------+ | | | | | | | +-------------+--------+--------+------------+--------+------------+ | Share | | | | | | | Capital | | | | | | +-------------+--------+--------+------------+--------+------------+ | At the | | | 58,609 | | 22,500 | | beginning | | | | | | | of period | | | | | | +-------------+--------+--------+------------+--------+------------+ | Share | | | 2,125 | | 30,264 | | issues | | | | | | +-------------+--------+--------+------------+--------+------------+ | Costs | | | (90) | | (35) | | of | | | | | | | issue | | | | | | +-------------+--------+--------+------------+--------+------------+ | At the | (7) | | 60,644 | | 52,729 | | end of | | | | | | | the | | | | | | | period | | | | | | +-------------+--------+--------+------------+--------+------------+ | | | | | | | +-------------+--------+--------+------------+--------+------------+ | Option | | | | | | | Premium | | | | | | | Reserve | | | | | | +-------------+--------+--------+------------+--------+------------+ | At the | | | 1,973 | | 1,690 | | beginning | | | | | | | of period | | | | | | +-------------+--------+--------+------------+--------+------------+ | Options | | | 326 | | 2,951 | | vesting | | | | | | | during | | | | | | | the | | | | | | | period | | | | | | +-------------+--------+--------+------------+--------+------------+ | Options | | | - | | (2,084) | | exercised | | | | | | +-------------+--------+--------+------------+--------+------------+ | At the | | | 2,299 | | 2,557 | | end of | | | | | | | the | | | | | | | period | | | | | | +-------------+--------+--------+------------+--------+------------+ | | | | | | | +-------------+--------+--------+------------+--------+------------+ | Accumulated | | | | | | | losses | | | | | | +-------------+--------+--------+------------+--------+------------+ | At the | | | (20,400) | | (13,986) | | beginning | | | | | | | of period | | | | | | +-------------+--------+--------+------------+--------+------------+ | Loss | | | (21,489) | | (6,057) | | for | | | | | | | the | | | | | | | half-year | | | | | | +-------------+--------+--------+------------+--------+------------+ | At the | | | (41,889) | | (20,043) | | end of | | | | | | | the | | | | | | | period | | | | | | +-------------+--------+--------+------------+--------+------------+ | | | | | | | +-------------+--------+--------+------------+--------+------------+ | Financial | | | | | | | Asset | | | | | | | reserve | | | | | | +-------------+--------+--------+------------+--------+------------+ | At the | | | - | | 1,786 | | beginning | | | | | | | of period | | | | | | +-------------+--------+--------+------------+--------+------------+ | Transfer | | | - | | (1,786) | | to cost | | | | | | | of | | | | | | | investment | | | | | | | upon | | | | | | | acquisition | | | | | | | of Gawler | | | | | | | Resources | | | | | | | Ltd | | | | | | +-------------+--------+--------+------------+--------+------------+ | At the | | | - | | - | | end of | | | | | | | the | | | | | | | period | | | | | | +-------------+--------+--------+------------+--------+------------+ | | | | | | | +-------------+--------+--------+------------+--------+------------+ | Foreign | | | | | | | Currency | | | | | | | Translation | | | | | | | Reserve | | | | | | +-------------+--------+--------+------------+--------+------------+ | At the | | | (510) | | (55) | | beginning | | | | | | | of period | | | | | | +-------------+--------+--------+------------+--------+------------+ | Recognised | | | 115 | | (181) | | during the | | | | | | | period | | | | | | +-------------+--------+--------+------------+--------+------------+ | At the | | | (395) | | (236) | | end of | | | | | | | the | | | | | | | period | | | | | | +-------------+--------+--------+------------+--------+------------+ | | | | | | | +-------------+--------+--------+------------+--------+------------+ | | | | | | | +-------------+--------+--------+------------+--------+------------+ | Total | | | | | | | Equity | | | | | | +-------------+--------+--------+------------+--------+------------+ | At the | | | 39,672 | | 11,935 | | beginning | | | | | | | of the | | | | | | | period | | | | | | +-------------+--------+--------+------------+--------+------------+ | At the | | | 20,659 | | 35,007 | | end of | | | | | | | the | | | | | | | period | | | | | | +-------------+--------+--------+------------+--------+------------+ The above balance sheet should be read in conjunction with the accompanying notes. Consolidated Cash Flow Statement for the half-year ended 31 December 2008 +--------------------+--------+--------+-----------+--------+-----------+ | | | | Consolidated | +--------------------+--------+--------+--------------------------------+ | | | | 2008 | | 2007 | +--------------------+--------+--------+-----------+--------+-----------+ | | | | $'000 | | $'000 | +--------------------+--------+--------+-----------+--------+-----------+ | Cash | | | | | | | flows | | | | | | | from | | | | | | | operating | | | | | | | activities | | | | | | +--------------------+--------+--------+-----------+--------+-----------+ | Receipts | | | 6,201 | | 235 | | from | | | | | | | sales | | | | | | +--------------------+--------+--------+-----------+--------+-----------+ | Payments | | | (2,795) | | (2,295) | | to | | | | | | | suppliers | | | | | | | and | | | | | | | employees | | | | | | +--------------------+--------+--------+-----------+--------+-----------+ | | | | | | | +--------------------+--------+--------+-----------+--------+-----------+ | Net | | | 3,406 | | (2,060) | | cash | | | | | | | outflow | | | | | | | from | | | | | | | operating | | | | | | | activities | | | | | | +--------------------+--------+--------+-----------+--------+-----------+ | | | | | | | +--------------------+--------+--------+-----------+--------+-----------+ | Cash | | | | | | | flows | | | | | | | from | | | | | | | investing | | | | | | | activities | | | | | | +--------------------+--------+--------+-----------+--------+-----------+ | Cash | | | - | | 3,304 | | acquired | | | | | | | with | | | | | | | subsidiary | | | | | | +--------------------+--------+--------+-----------+--------+-----------+ | Payments for | | (4,529) | | (2,514) | | exploration, | | | | | | evaluation and | | | | | | development | | | | | +-----------------------------+--------+-----------+--------+-----------+ | Loans | | | - | | (3,220) | | to | | | | | | | other | | | | | | | entities | | | | | | +--------------------+--------+--------+-----------+--------+-----------+ | Proceeds | | | - | | 210 | | from | | | | | | | sale of | | | | | | | equity | | | | | | | investments | | | | | | +--------------------+--------+--------+-----------+--------+-----------+ | Interest | | | 216 | | 106 | | received | | | | | | +--------------------+--------+--------+-----------+--------+-----------+ | | | | | | | +--------------------+--------+--------+-----------+--------+-----------+ | Net | | | (4,313) | | (2,114) | | cash | | | | | | | inflow | | | | | | | (outflow) | | | | | | | from | | | | | | | investing | | | | | | | activities | | | | | | +--------------------+--------+--------+-----------+--------+-----------+ | | | | | | | +--------------------+--------+--------+-----------+--------+-----------+ | Cash | | | | | | | flows | | | | | | | from | | | | | | | financing | | | | | | | activities | | | | | | +--------------------+--------+--------+-----------+--------+-----------+ | Proceeds | | | 1,607 | | 7 | | from | | | | | | | issues | | | | | | | of | | | | | | | shares | | | | | | +--------------------+--------+--------+-----------+--------+-----------+ | Proceeds | | | - | | 2,590 | | from | | | | | | | issue of | | | | | | | convertible | | | | | | | notes | | | | | | +--------------------+--------+--------+-----------+--------+-----------+ | Interest | | | (150) | | (283) | | paid | | | | | | +--------------------+--------+--------+-----------+--------+-----------+ | Share | | | (104) | | (35) | | issue | | | | | | | costs | | | | | | +--------------------+--------+--------+-----------+--------+-----------+ | | | | | | | +--------------------+--------+--------+-----------+--------+-----------+ | Net | | | 1,353 | | 2,279 | | cash | | | | | | | inflow | | | | | | | from | | | | | | | financing | | | | | | | activities | | | | | | +--------------------+--------+--------+-----------+--------+-----------+ | | | | | | | +--------------------+--------+--------+-----------+--------+-----------+ | Net increase | | 446 | | (1,895) | | (decrease) in | | | | | | cash and cash | | | | | | equivalents | | | | | +-----------------------------+--------+-----------+--------+-----------+ | Cash and cash | | 10,604 | | 4,406 | | equivalents at | | | | | | the beginning | | | | | | of the period | | | | | +-----------------------------+--------+-----------+--------+-----------+ | Effect | | | 1,481 | | (22) | | of | | | | | | | exchange | | | | | | | rate | | | | | | | changes | | | | | | | on | | | | | | | foreign | | | | | | | currency | | | | | | | denominated | | | | | | | cash | | | | | | | balances | | | | | | +--------------------+--------+--------+-----------+--------+-----------+ | | | | | | | +--------------------+--------+--------+-----------+--------+-----------+ | Cash | | | 12,531 | | 2,489 | | and | | | | | | | cash | | | | | | | equivalents | | | | | | | at the end | | | | | | | of the | | | | | | | period | | | | | | +--------------------+--------+--------+-----------+--------+-----------+ The above cash flow statement should be read in conjunction with the accompanying notes. Notes to the financial statements for the half-year ended 31 December 2008 1. Basis of preparation of half-year report This general purpose financial report for the interim half-year reporting period ended 31 December 2008 has been prepared in accordance with Australian Accounting Standard 134 Interim Financial Reporting and the Corporations Act 2001. This interim report does not include all the notes of the type normally included in an annual financial report. Accordingly, this interim financial report is to be read in conjunction with the annual report for the year ended 30 June 2008 and any public announcements made by the Company during the interim reporting period in accordance with the continuous disclosure requirements of the Corporations Act 2001. The accounting policies adopted are consistent with those of the previous financial year and corresponding interim reporting period. (a) Going Concern The Financial Report has been prepared on the going concern basis, which contemplates the continuity of normal business activity and the realisation of assets and the settlement of liabilities in the normal course of business. As disclosed in Note 6 to the Financial Report, subsequent to 31 December 2008 the Company's wholly-owned subsidiary, Elixir Petroleum (UK) Limited ("EP(UK)"), received a notice of arbitration issued by TGS-NOPEC Invest AS ("TGS"), the seismic contractor which acquired 3D seismic over Block SL-4, located offshore Sierra Leone during the course of 2008. The notice of arbitration relates to an alleged dispute concerning payment of approximately US$9.3 million for the seismic data acquired by TGS. EP(UK) has been named as a co-Respondent in the arbitration together with Prontinal Limited ("Prontinal"), EP(UK)'s former joint venture partner in the Block SL-4 joint venture. EP(UK) understands that an existing arbitration in relation to the dispute is currently in progress between Prontinal and TGS. It remains the view of EP(UK) that Prontinal is responsible for the payment of any sums that are found to be due to TGS in respect of the 3D seismic acquisition and processing, notwithstanding the forfeiture of their interest in Block SL-4 to EP(UK). EP(UK) has commenced legal proceedings in the British Virgin Islands seeking recovery of monies owed to it by Prontinal and the winding up of Prontinal. Prontinal has lodged documentation to set aside the proceedings, with a hearing on this matter currently set down for mid-March 2009. EP(UK) is in the process of obtaining advice from its legal counsel in relation to the Notice of Arbitration. As at the date of the Financial Report, EP(UK) intends to vigorously defend its position with respect to the arbitration and it is the current intention of the Company to provide EP(UK) with the necessary funding to do so. The Board will continue to review the appropriateness of this ongoing support in light of future developments as the matter progresses and in so doing will at all times seek to ensure that the best interests of the Company's stakeholders are served. The Directors consider that the claim against EP(UK) is without merit. Notwithstanding this, there is a risk that EP(UK) could be found to be liable for some or all of the amounts claimed, which may prejudice EP (UK)'s ability to continue as a going concern. Should EP(UK) be unable to continue as a going concern, it may be required to realise its assets and extinguish its liabilities other than in the normal course of business and at amounts different from those stated in the Financial Report. The Financial Report does not include any adjustments relating to the recoverability and classification of recorded asset amounts or to the amounts and classification of liabilities that may be necessary should EP(UK) be unable to continue as a going concern. Having regard to these factors, the Financial Report has been prepared on a going concern basis which the Directors consider to be appropriate. (b) Critical accounting estimates and judgements In preparing this Financial Report the Group has been required to make certain estimates and assumptions concerning future occurrences. There is an inherent risk that the resulting accounting estimates will not equate exactly with actual events and results. Significant accounting judgments In the process of applying the Group's accounting policies, management has made the following judgements, apart from those involving estimations, which have the most significant effect on the amounts recognised in the financial statements: Functional currency of US-based subsidiary operations The Group's US based subsidiaries are at this stage financed primarily by means of A$ denominated loans and/or equity contributions. As such, the functional currency of these subsidiaries has been determined to be A$, not withstanding that they also conduct significant US$ denominated transactions. Exploration, evaluation and development expenditure (including Oil & Gas properties) Application of the Group's accounting policy for exploration, evaluation and development requires management to make certain estimates and assumptions as to future events and circumstances, in particular, the assessment of whether economic quantities of reserves have been found. Any such estimates and assumptions may change as new information becomes available. If, after having capitalised expenditure under our policy, we conclude that we are unlikely to recover the expenditure by future exploitation or sale, then the relevant capitalised amount will be written off to the Income Statement. As at 31 December 2008 the carrying amount of Oil & Gas Properties is $11,106,000 (30 June 2008: $31,569,000). Deferred tax assets The Group has carried forward tax losses which have not been recognised as deferred tax assets as it is not considered sufficiently probable that these losses will be recouped by means of future profits taxable in the appropriate jurisdictions. In addition, the Group's interests in jointly controlled oil & gas operations are held through the Company's wholly-owned US subsidiary entities. Taxation of oil & gas activities in the US allows a number of alternative treatments which are not available under Australian Taxation Legislation. In particular, companies may elect to: (i) claim an immediate deduction for Intangible Drilling Costs ("IDC"); and / or, (ii) elect to apply the "Percentage Depletion" method of depreciation to Oil & Gas Properties. The Percentage Depletion method permits certain taxpayers with economic interests in oil and gas operation to deduct a specified percentage (15%) of the gross income from these operations instead of cost depletion. An election as to whether to apply Percentage Depletion or Cost Depletion is made each year on a well-by-well basis and accordingly, application of the method can result in an effective tax base for the oil & gas operations which is significantly in excess of their actual cost. The directors have not recognised or disclosed a deferred tax asset in respect of this potential increase in the tax base of these assets as they do not believe it is capable of being reliably estimated at this stage. Claiming an immediate deduction for IDC for the period ended 31 December 2008 would result in an accelerated deduction of the tax base of the Group's jointly controlled oil and gas operations. This accelerated deduction would result in recognition of a deferred tax liability and an offsetting deferred tax asset in relation to the losses claimed. There would be no effect on either gross or net assets, or on the income statement for the year. As at the date of this report, the directors have not yet finalised which alternatives will be adopted by the Group's US subsidiary entities for the period and accordingly have not recognised or disclosed a deferred tax asset or liability in respect of immediate IDC deductions which may be claimed in the future. Significant accounting estimates The carrying amounts of certain assets and liabilities are often determined based on estimates and assumptions of future events. The key estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of certain assets and liabilities within the next annual reporting period are: Amortisation Upon commencement of production, Elixir amortises the accumulated costs for the relevant area of interest over the life of the area according to the estimated rated of depletion of the economically recoverable quantities of reserves. Estimates of recoverable reserve quantities include judgemental assumptions regarding commodity prices, exchange rates, discount rates, and production and transportation costs for future cash flows. It also requires interpretation of quality of reservoirs, and their anticipated recoveries. The economic, geological and technical factors used to estimate reserves may change from period to period. Amortisation charge for the period ended 31 December 2008 was $7,580,000 (December 2007: 5,808,000). Share-based payment transactions The Group measures the cost of equity-settled transactions with employees and consultants by reference to the fair value of the equity instruments at the date at which they are granted. The fair value is determined using a Binomial model. Rehabilitation obligations The Group estimates its share of the future removal and remediation costs of oil and gas platforms, production facilities, wells and pipelines at the time of acquisition or installation of the assets. In most instances, removal of assets occurs many years into the future. This requires judgemental assumptions regarding removal date, future environmental legislation, the extent of remediation activities required, the engineering methodology for estimating cost, future removal technologies in determining the removal cost, and asset specific discount rates to determine the present value of these cash flows. For more detail regarding the policy in respect of provision for rehabilitation refer to Note 1(m). As at 31 December 2008 rehabilitation obligations have a carrying value of $1,484,000 (30 June 2008: 1,484,000). Impairment of assets In the absence of readily available market prices, the recoverable amounts of assets are determined using estimations of the present value of future cashflows using asset-specific discount rates. For Oil & Gas Properties, these estimates are based on assumptions concerning reserves, future production profiles and costs. As at 31 December 2008, the carrying value of Oil & Gas Properties is $11,106,000 (2007: Nil). 2. Loss for the half-year Loss for the half-year includes the following items which are significant because of their nature, size or incidence: +--------------+--------+-----------+--------+----------+ | | | 2008 | | 2007 | +--------------+--------+-----------+--------+----------+ | | | $'000 | | $'000 | | | | | | | +--------------+--------+-----------+--------+----------+ | Foreign | | 1,568 | | - | | exchange | | | | | | gain | | | | | +--------------+--------+-----------+--------+----------+ | | | | | | +--------------+--------+-----------+--------+----------+ | Amortisation | | 7,565 | | 5,808 | | of oil & gas | | | | | | properties | | | | | +--------------+--------+-----------+--------+----------+ | Depreciation | | 15 | | - | | of plant and | | | | | | equipment | | | | | +--------------+--------+-----------+--------+----------+ | Employee | | 229 | | - | | benefits | | | | | | expense | | | | | +--------------+--------+-----------+--------+----------+ | Borrowing | | 151 | | 282 | | costs | | | | | +--------------+--------+-----------+--------+----------+ | Exploration | | 4,191 | | 1,292 | | and | | | | | | evaluation | | | | | | expense | | | | | +--------------+--------+-----------+--------+----------+ | Impairment | | 12,918 | | - | | of oil & | | | | | | gas | | | | | | properties | | | | | +--------------+ +-----------+--------+----------+ | | | | | | +--------------+ +-----------+--------+----------+ | | | | | | +--------------+--------+-----------+--------+----------+ 3. Segment Note Primary reporting - Geographical Segments Elixir operates in three main geographical segments, Australia, Europe and the USA. Australia Australia is the location of the central management and control of the Company and its principal administrative base. Europe The Group's North Sea exploration activities and license interests are located in the United Kingdom. The Group's European operations are conducted through its locally registered subsidiaries, Elixir Petroleum (UK) Limited, Elixir Petroleum (Europe) Ltd and Elixir Petroleum (Technical Services) Ltd. USA The Group's interest in the High Island and Pompano projects are held by a wholly-owned US subsidiary, Cottesloe Oil & Gas, LLC. +--------------+------------+-----------+-----------+-------------+------------+ | 2008 | USA | Europe |Australia |Unallocated | Total | | | | & | | | | | | | Africa | | | | +--------------+------------+-----------+-----------+-------------+------------+ | | $'000 | $'000 | $'000 | $'000 | $'000 | +--------------+------------+-----------+-----------+-------------+------------+ | Sales | 4,197 | - | - | - | 4,197 | +--------------+------------+-----------+-----------+-------------+------------+ | Other | - | 118 | - | 1,594 | 1,712 | | revenue | | | | | | +--------------+------------+-----------+-----------+-------------+------------+ | Expenses | (24,597) | (978) | - | (1,824) | (27,399) | +--------------+------------+-----------+-----------+-------------+------------+ | Loss | (20,400) | (859) | - | (230) | (21,490) | | before | | | | | | | tax | | | | | | +--------------+------------+-----------+-----------+-------------+------------+ | Tax | - | - | - | - | - | +--------------+------------+-----------+-----------+-------------+------------+ | Loss | (20,400) | (859) | - | (230) | (21,490) | | after | | | | | | | tax | | | | | | +--------------+------------+-----------+-----------+-------------+------------+ | | | | | | | +--------------+------------+-----------+-----------+-------------+------------+ | Total | 13,008 | 2,109 | - | 10,741 | 26,858 | | assets | | | | | | +--------------+------------+-----------+-----------+-------------+------------+ | Total | (1,606) | (628) | - | (3,966) | (6,200) | | liabilities | | | | | | +--------------+------------+-----------+-----------+-------------+------------+ | Depreciation | 7,565 | 15 | - | - | 7,580 | | and | | | | | | | Amortisation | | | | | | +--------------+------------+-----------+-----------+-------------+------------+ | | | | | | | +--------------+------------+-----------+-----------+-------------+------------+ | | | | | | | +--------------+------------+-----------+-----------+-------------+------------+ | | | | | | | +--------------+------------+-----------+-----------+-------------+------------+ | 2007 | USA | Europe |Australia |Unallocated | Total | | | | & | | | | | | | Africa | | | | +--------------+------------+-----------+-----------+-------------+------------+ | | $'000 | $'000 | $'000 | $'000 | $'000 | +--------------+------------+-----------+-----------+-------------+------------+ | Sales | 2,883 | - | - | - | 2,883 | +--------------+------------+-----------+-----------+-------------+------------+ | Other | 7 | 82 | 26 | - | 115 | | revenue | | | | | | +--------------+------------+-----------+-----------+-------------+------------+ | Expenses | (6,026) | (2,085) | (945) | - | (9,056) | +--------------+------------+-----------+-----------+-------------+------------+ | Loss | (3,136) | (2,003) | (919) | - | (6,058) | | before | | | | | | | tax | | | | | | +--------------+------------+-----------+-----------+-------------+------------+ | Tax | - | - | - | - | - | +--------------+------------+-----------+-----------+-------------+------------+ | Loss | (3,136) | (2,003) | (919) | - | (6,058) | | after | | | | | | | tax | | | | | | +--------------+------------+-----------+-----------+-------------+------------+ | | | | | | | +--------------+------------+-----------+-----------+-------------+------------+ | Total | 33,151 | 2,722 | - | 547 | 36,421 | | assets | | | | | | +--------------+------------+-----------+-----------+-------------+------------+ | Total | (1,130) | (193) | - | (90) | (1,413) | | liabilities | | | | | | +--------------+------------+-----------+-----------+-------------+------------+ | Depreciation | 5,808 | 9 | - | - | 5,817 | | and | | | | | | | amortisation | | | | | | +--------------+------------+-----------+-----------+-------------+------------+ 4. Oil & Gas Properties +--------------+------------+--------+-----------+ | | Consolidated | +--------------+---------------------------------+ | | 31-Dec-08 | |30-Jun-08 | +--------------+------------+--------+-----------+ | | $'000 | | $'000 | +--------------+------------+--------+-----------+ | Producing | | | | | projects | | | | +--------------+------------+--------+-----------+ | At | 41,113 | | 41,113 | | cost | | | | +--------------+------------+--------+-----------+ | Accumulated | (17,109) | | (9,544) | | amortisation | | | | +--------------+------------+--------+-----------+ | Write | (12,898) | | - | | off | | | | | during | | | | | the | | | | | half-year | | | | +--------------+------------+--------+-----------+ | Net | 11,106 | | 31,569 | | carrying | | | | | amount | | | | +--------------+------------+--------+-----------+ A reconciliation of movements in Oil & Gas Properties during the half-year is as follows: +--------------+-----------+--------+------------+--------+------------+ | | Tangible | |Intangible | | Total | | | Costs | | Costs | | | +--------------+-----------+--------+------------+--------+------------+ | | $ | | $ | | $ | +--------------+-----------+--------+------------+--------+------------+ | Producing | | | | | | | Projects | | | | | | +--------------+-----------+--------+------------+--------+------------+ | | | | | | | +--------------+-----------+--------+------------+--------+------------+ | At | | | | | | | Cost | | | | | | +--------------+-----------+--------+------------+--------+------------+ | At 1 | 3,013 | | 36,616 | | 39,629 | | July | | | | | | | 2008 | | | | | | +--------------+-----------+--------+------------+--------+------------+ | Provision | - | | (12,898) | | (12,898) | | for | | | | | | | impairment | | | | | | +--------------+-----------+--------+------------+--------+------------+ | | | | | | | +--------------+-----------+--------+------------+--------+------------+ | Associated | | | | | | future | | | | | | restoration | | | | | | costs | | | | | | (capitalised) | | | | | +--------------------------+--------+------------+--------+------------+ | At 1 | - | | 1,484 | | 1,484 | | July | | | | | | | 2008 | | | | | | +--------------+-----------+--------+------------+--------+------------+ | | | | | | | +--------------+-----------+--------+------------+--------+------------+ | At 31 | 3,013 | | 25,202 | | 28,215 | | December | | | | | | | 2008 | | | | | | +--------------+-----------+--------+------------+--------+------------+ | | | | | | | +--------------+-----------+--------+------------+--------+------------+ | Accumulated | | | | | | | amortisation | | | | | | +--------------+-----------+--------+------------+--------+------------+ | At 1 | (700) | | (8,844) | | (9,544) | | July | | | | | | | 2008 | | | | | | +--------------+-----------+--------+------------+--------+------------+ | Charge | - | | (7,565) | | (7,565) | | for | | | | | | | the | | | | | | | half-year | | | | | | +--------------+-----------+--------+------------+--------+------------+ | At 31 | (700) | | (16,409) | | (17,109) | | December | | | | | | | 2008 | | | | | | +--------------+-----------+--------+------------+--------+------------+ | | | | | | | +--------------+-----------+--------+------------+--------+------------+ | At 1 | 2,313 | | 29,256 | | 31,569 | | July | | | | | | | 2008 | | | | | | +--------------+-----------+--------+------------+--------+------------+ | At 31 | 2,313 | | 8,793 | | 11,106 | | December | | | | | | | 2008 | | | | | | +--------------+-----------+--------+------------+--------+------------+ 5. Dividends No dividend has been paid or is proposed in respect of the half-year ended 31 December 2008 (2007: None). 6. Contingencies Block SL-4 As disclosed also in Note 1(a), subsequent to 31 December 2008 the Company's wholly-owned subsidiary, Elixir Petroleum (UK) Limited ("EP(UK)"), received a notice of arbitration issued by TGS-NOPEC Invest AS ("TGS"), the seismic contractor which acquired 3D seismic over Block SL-4, located offshore Sierra Leone during the course of 2008. The notice of arbitration relates to an alleged dispute concerning payment of approximately US$9.3 million for the seismic data acquired by TGS. EP(UK) has been named as a co-Respondent in the arbitration together with Prontinal, EP(UK)'s former joint venture partner in the Block SL-4 joint venture. EP(UK) understands that an existing arbitration in relation to the dispute is currently in progress between Prontinal and TGS. It remains the view of EP(UK) that Prontinal is responsible for the payment of any sums that are found to be due to TGS in respect of the 3D seismic acquisition and processing, notwithstanding the forfeiture of their interest in Block SL-4 to EP(UK). EP(UK) has commenced legal proceedings in the British Virgin Islands seeking recovery of monies owed to it by Prontinal and the winding up of Prontinal. Prontinal has lodged documentation to set aside the proceedings, with a hearing on this matter currently set down for mid-March 2009. EP(UK) is in the process of obtaining advice from its legal counsel in relation to the Notice of Arbitration. As at the date of the Financial Report, EP(UK) intends to vigorously defend its position with respect to the arbitration and it is the current intention of the Company to provide EP(UK) with the necessary funding to do so. The Board will continue to review the appropriateness of this ongoing support in light of future developments as the matter progresses and in so doing will at all times seek to ensure that the best interests of the Company's stakeholders are served. The Directors consider that the claim against EP(UK) is without merit. Notwithstanding this, there is a risk that EP(UK) could be found to be liable for some or all of the amounts claimed. Other than as disclosed above, at balance date the Consolidated Entity had no material contingent assets or liabilities or firm contractual commitments for expenditure not reflected in the Financial Report. 7. Reconciliation of movements in consolidated equity Movements in consolidated equity during the six months were as follows: +-------------+--------+--------+--------+----------------+--------+--------+--------+-----------+ |Description | | Date | | Number | | Issue | | $'000 | | | | | | of | | Price | | | | | | | | shares | | | | | +-------------+--------+--------+--------+----------------+--------+--------+--------+-----------+ | | | | | | | | | | +-------------+--------+--------+--------+----------------+--------+--------+--------+-----------+ | Opening | | 01 Jul | | 181,117,922 | | | | 58,609 | | balance | | 08 | | | | | | | +-------------+--------+--------+--------+----------------+--------+--------+--------+-----------+ | Share | | 01 Jul | | 1,950,550 | | $ | | 527 | | issue | | 08 | | | | 0.270 | | | +-------------+--------+--------+--------+----------------+--------+--------+--------+-----------+ | Share | | 08 Jul | | 5,920,000 | | $ | | 1,598 | | issue | | 08 | | | | 0.270 | | | +-------------+--------+--------+--------+----------------+--------+--------+--------+-----------+ | Less: | | | | | | | | (90) | | transaction | | | | | | | | | | costs | | | | | | | | | +-------------+--------+--------+--------+----------------+--------+--------+--------+-----------+ | Closing | | 31 Dec | | 188,988,472 | | | | 60,644 | | balance | | 08 | | | | | | | +-------------+--------+--------+--------+----------------+--------+--------+--------+-----------+ 8. Events occurring after the balance sheet date Repayment of convertible notes During January 2009, the Company repaid, upon their expiry $3 million in convertible loan notes, leaving the Elixir Group debt-free. De-listing from AIM On 3 March 2009, the Company announced its intention to cancel the admission of its ordinary shares to trading on AIM with effect from 31 March 2009. Other than as disclosed above or elsewhere in this half-year financial report, no event has arisen since 31 December 2008 that would be likely to materially affect the operations of the Consolidated Entity, the results of the Consolidated Entity or the state of affairs of the Consolidated Entity. 9. Risk Management Elixir's board of directors (Board) performs the duties of a risk management committee in identifying and evaluating sources of financial and other risks. The Board seeks to balance the potential adverse effects of financial risks on Elixir's financial performance and position with the "upside" potential made possible by exposure to these risks and by taking into account the costs and expected benefits of the various methods available to manage them. AASB 132 Financial Instruments Presentation and Disclosure requires the disclosure of information to assist users of the financial report in assessing the extent of risks related to financial instruments faced by the Group. These risks include financial risks such as market risks (including currency risk, fair value interest rate risk and commodity price risk), credit risk & liquidity risk. These disclosures are not nor are they intended to be an exhaustive list of risks to which Elixir is exposed. (a) Market risk (i) Commodity price risk As a result of its operations the Group is exposed to commodity price risk arising due to fluctuations in the prices of natural gas and crude oil. The demand for, and prices of, natural gas and crude oil are dependent on a variety of factors, including: * Supply and demand; * The level of consumer product demand; * Weather conditions; * The price and availability of alternative fuels; * Actions taken by governments and international cartels; and, * Global economic and political developments. As at balance date, the Board has formed the view that it would not be beneficial for the Group to purchase forward contracts or other derivative financial instruments to hedge this commodity price risk. Factors which the board considered in arriving at this position included the expense of purchasing such instruments and the inherent difficulties associated with forecasting future production levels while the Group realises the value of its oil & gas assets. As development and diversification of the Group's productions assets progresses and it becomes possible to forecast future production levels with a greater degree of certainty, the Board may reconsider its position with regard to hedging against commodity price risk in the future. (ii) Foreign exchange risk Elixir's principal office is based in Australia, its shares are listed on the Australian Stock Exchange and London AIM market and the Consolidated Entity reports its financial performance and position in Australian dollars (A$). The Group maintains a UK office and, as its activities are focussed in the oil & gas exploration, development and production sector, it also has significant United States dollar (US$) denominated cashflows. As a result of these factors, the Group is exposed to foreign exchange risk arising from fluctuations in the AU$ / US$ and AU$ / GBP exchange rates. As at balance date, the Board has formed the view that it would not be beneficial for the Group to purchase forward contracts or other derivative financial instruments to hedge this foreign exchange risk. Factors which the board considered in arriving at this position included: The expense of purchasing such instruments; the inherent difficulties associated with forecasting the timing and quantum of US$ cash inflows and outflows while the Group realises the value of its oil & gas assets. The Board may reconsider its position with regard to hedging against foreign exchange risk in the future as the Group's activities evolve and / or in response to industry or macro-economic factors. (iii) Interest rate risk As at and during the period ended on balance date the Group had no significant interest-bearing assets or liabilities other than liquid funds on deposit and convertible notes (fixed rate, repaid in January 2009). As such, the Group's income and operating cash flows (other than interest income from funds on deposit) are substantially independent of changes in market interest rates. (b) Credit risk The Group seeks to trade only with recognised, trustworthy third parties and it is the Group's policy to perform credit verification procedures in relation to any customers wishing to trade on credit terms with the Group. Notwithstanding the above, the Group is exposed to level of credit risk arising from the fact that a large proportion of its receivables and non-current oil & gas assets relate to its interests in projects operated by private companies. The Board are of the opinion that the credit risk arising as a result of this concentration of the Group's assets is more than offset by the potential benefits to be gained through continuing to build on the Group's relationship with the operators of its existing projects. Other than as disclosed in Note 1(a) and Note 6 in relation to SL-4 Joint Venture, the maximum exposure to credit risk at the reporting date is the carrying amount of trade receivables, being $1,525,000 ($3,670,000 as at 30 June 2008). The Group has a number of recourse options available in the event of counterparty default, including but not limited to de facto security over jointly held assets. (c) Liquidity risk Prudent liquidity management involves the maintenance of sufficient cash, marketable securities, committed credit facilities and access to capital markets. It is the policy of the board to ensure that the Group is able to meet its financial obligations and maintain the flexibility to pursue attractive investment opportunities through keeping committed credit lines available where possible, ensuring the Group has sufficient working capital and preserving the 15% share issue limit available to the Company under the ASX Listing Rules. Maturities of financial liabilities Group - As at reporting date the Group had total financial liabilities of $1,716,000 (30 June 2008: $5,983,000), comprised of convertible notes which were repaid in January 2009, non interest-bearing trade creditors and accruals with a maturity of less than 6 months. (d) Net fair value The carrying amount of financial assets and liabilities recorded in the financial statements approximate their fair value as at 31 December 2008. This information is provided by RNS The company news service from the London Stock Exchange END IR GUUCAWUPBUQW
1 Year Elixir Petroleum Chart |
1 Month Elixir Petroleum Chart |
It looks like you are not logged in. Click the button below to log in and keep track of your recent history.
Support: +44 (0) 203 8794 460 | support@advfn.com
By accessing the services available at ADVFN you are agreeing to be bound by ADVFN's Terms & Conditions
Hot Features
Premium
