Share Name Share Symbol Market Type Share ISIN Share Description
Solo Oil Plc LSE:SOLO London Ordinary Share GB00BF1BK408 ORD 0.20P
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  +0.00p +0.00% 1.325p 1.25p 1.40p 1.325p 1.30p 1.30p 0 08:00:05
Industry Sector Turnover (m) Profit (m) EPS - Basic PE Ratio Market Cap (m)
Oil & Gas Producers 0.0 -1.7 -0.3 - 8

Solo Oil Plc Full-Year Results 2018 and Notice of AGM

28/06/2019 4:55pm

UK Regulatory (RNS & others)


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RNS Number : 9085D

Solo Oil Plc

28 June 2019

28 June 2019

Solo Oil plc

("Solo Oil" or "The Company")

Full-Year Results 2018 and Notice of AGM

"Continued strategic evolution"

Solo Oil (AIM: SOLO), a natural resources investment company focused on acquiring a balanced portfolio of production, development and exploration assets, is pleased to announce its audited financial statements for the year ended 31 December 2018.

Period and Post-Period Highlights:

   --      Assembled a strong Board with deep industry, technical, commercial and financial expertise 

-- New strategy focused on assembling balanced, full-cycle portfolio comprised of production, development and exploration assets

   --      Set net production target of 5,000 boepd within three years 

-- Solo is currently trading at approximately a 50% discount to NAV; a gap the Board hopes will close over the coming year

-- Significant independent resource upgrade at Ntorya assigning net resources of approximately 467 bcf Pmean GIIP

-- Aminex's proposed farmout of 50% interest in Ruvuma validates commerciality of Solo's 25% WI

   --      Current expectation is that drilling of Chikumbi-1 well scheduled for H1 2020 
   --      Successful divestment of non-core assets including interest in: 

o Horse Hill Development Limited

o PEDL331 Licence on the Isle of Wight

   --      Actively engaged in positive discussions with regards to new business development 

-- Sound financial footing with zero debt and ample working capital to fund near-term work commitments

   --      Continued focus on cost discipline and reducing of G&A 

The Company's Annual General Meeting ("AGM") will be held at 11a.m. BST on 27 August at the offices of Buchanan, 3rd Floor, 107 Cheapside, London, EC2V 6DN.

The Annual Report and notice convening the AGM will be posted to shareholders today and will be available shortly on the website www.solooil.co.uk

For further information:

 
 Solo Oil plc 
  Executive Chairman 
  Alastair Ferguson                        +44 (0) 20 7440 0642 
 
 Strand Hanson 
  Nominated & Financial Adviser 
  Rory Murphy / James Spinney / Ritchie 
  Balmer                                   +44 (0) 20 7409 3494 
 Shore Capital 
  Broker 
  Jerry Keen 
                                            +44 (0) 20 7408 4090 
  Buchanan 
  Financial PR 
  Ben Romney / Chris Judd / James 
  Husband                                    +44 (0) 20 7466 5000 
 

Chairman's Statement

I am pleased to provide the following overview of Solo's operational, corporate and strategic milestones achieved during the year-ended 31 December 2018.

When I joined the Board as Non-Executive Chairman on 6 August 2018 at the AGM, I stated that I had four priorities; to put the company on a sustainable path in terms of funding the work programme and paying off debt; an absolute focus on commercialisation and value realisation and improving our JV management; improving communication with shareholders and; undertaking a major strategic review where all options would be considered. I am pleased to say that we have made significant progress on all four of these objectives during the period and this work has gained further momentum through 2019.

It was undoubtedly an eventful year in which the Company fulfilled a number of strategic objectives and benefitted from some notable operational and corporate events. Despite significant progress in certain areas, the Board became conscious that strategic evolution was required in order to deliver long-term, sustainable value for its shareholders. As such, through the second half of the year, a major focus of the Board was developing the new strategy around which it intends to grow the business and deliver value.

Strategic evolution

The new strategy was formally announced post-period in March 2019 and followed a prolonged period of consultation, option review and viability assessment. The core rationale for a shift in strategy was diversification of Solo's portfolio in terms of geographies and asset type. The existing portfolio witnessed a number of positive developments throughout the year, as summarised later in my statement, which I believe the market is yet to fully appreciate. This disconnect between the share price performance and our net asset value represents the very context of why a strategic evolution is underway. The fact that Solo's core investments are non-operated positions in early-stage exploration or development assets within Tanzania, a challenging jurisdiction in which timelines and outcomes are frustratingly uncertain, underpins the rationale for the need to adapt the strategy and transition from an investing company to an operating company with greater control over the outcome of investment decisions and a focus on cash flow.

Solo now has a very clear strategic vision; to assemble a balanced, full lifecycle portfolio comprised of production, development and exploration assets that provide a sustainable path for growth alongside funded G&A. Leveraging the requisite technical, corporate and operating expertise of the Board, the Company intends to achieve scale through organic and acquisition led growth and has set a net production target of at least 5,000 boepd within the next three years.

This growth strategy will be delivered in parallel with a continued focus on value realisation of existing assets; a focus that gained traction through 2018 and resulted in a number of non-core divestments in line with Solo's strategic objectives.

Portfolio Review

Solo's existing portfolio continues to be progressed through technical work, and the year commenced positively with a significant resource upgrade at Ntorya emphasising the quality and upside potential of this asset in which Solo retains a 25% interest.

With the independent report verifying 2C contingent resource estimate of 763 billion cubic feet ("bcf") and Pmean gross gas initially in place ("GIIP") upgraded to 1.87 trillion cubic feet ("tcf"), Solo now holds net resources of approximately 467 bcf Pmean GIIP, resulting in excess of 190 bcf (over 30 million barrels oil equivalent ("mmboe")) of most likely contingent resources net to its 25% interest.

In July 2018, Aminex announced a significant proposed farmout transaction in which it will be selling 50% of its interest in Ruvuma to ARA, a wholly owned subsidiary of the Zubair Corporation, who will also become Operator upon formal ratification of the transaction. The transaction represents a very significant milestone for Solo as it validates the commercial attractiveness of the project, and also brings in a well-capitalised and credible Operator into the JV to help drive the project forward towards successful development.

Aminex's transaction emphasised the significant discount of value currently ascribed to Solo's material interest in this project. The transaction has galvanised Solo's confidence in its ability to divest its interest at a significant premium to the value currently assigned by the market, and the Company's efforts to realise value from this core investment have intensified.

Solo is fortunate to have optionality with regards to its monetisation strategy and the Board believes that its proposed growth strategy will further strengthen this optionality. By this, we mean that we are in a position that we would only consider offers which we think fairly value our interest in Ruvuma, and all other investments. Our balance sheet remains robust and we retain the option to fund our working interest share of forward costs, including the proposed Chikumbi well, as the JV progresses the project towards development and material cash flow.

Whilst the intention remains to divest of part or all of our interest in Ruvuma, we will only do so if it is in the best interest of shareholders. Our interest in Ruvuma remains the jewel in our current crown, however the strategy to diversify the business in line with our strategic vision will ensure the company is not reliant on a binary divestment outcome, the timelines and value of which remain uncertain.

During the year Solo successfully divested of its interest in Horse Hill Developments Limited ("HHDL"), in return for shares in UK Oil and Gas ("UKOG"). Having acquired an additional 5% of the project in February 2018, the consideration of the transaction with UKOG resulted in a total return of 45% on its overall investment in HHDL since 2014. The divestment was consistent with Solo's strategy to rationalise the portfolio and focus on value realisation from the core portfolio. Solo has subsequently sold the large majority of its shares in UKOG at a significant premium to the current prevailing market price and is progressing towards its objective of selling down the entirety of its stock in UKOG. Presently, Solo continues to retain small exposure to Horse Hill and is pleased by the technical and commercial validation of that project.

Part of the proceeds (approximately GBP624,000) were used to pay off the Riverfort convertible loan facility in September 2018, which ensured that the Company is debt free. This was an important step in putting the Company on a sustainable path for 2019.

Prior to year-end, Solo also announced that it had disposed of its 30% interest in PEDL331 Licence on the Isle of Wight to UKOG for a total consideration of GBP350,000 in cash and shares. The divestment resulted in an investment return of 2.25 times on the asset and relinquished the Company from future operating costs associated with the asset. Whilst the asset remains interesting from a geological perspective, it was not being assigned any material value in Solo's portfolio and was not consistent with the asset profile around which the forward portfolio will be constructed.

Solo's investment in Helium One continues to represent one of the core investments in the portfolio and one that the Board believes will deliver a significant return on investment at the appropriate time, given the strong underlying fundamentals in the global supply / demand balance of helium. Helium One completed a $2m pre-IPO fundraise in June 2018 to ensure that the company is capitalised through to the drilling of the exploration well, which is currently anticipated to commence later this year, subject to rig availability and certain licencing conditions. We expect to see further progress during 2019 in delivering a route to liquidity.

Following a challenging operational performance of Kiliwani North through the year, due to a drop in pressure and subsequent shutting in of production, Solo worked with the Operator and JV partners to establish remedial actions to return the asset to production. Pleasingly, post-period, intervention and work-over operations have resolved the Kiliwani North-1 subsurface safety valve issue, with gas flowing to the plant during test period. The Operator has expressed plans to accelerate development by reprocessing 2D seismic and acquiring new 3D seismic.

Whilst Solo's interest in Kiliwani-North is small at 8.3%, it remains a core asset within the portfolio given the upside potential within the lower horizons and the Kiliwani South prospect, and provides a clear path to monetise new volumes quickly into existing infrastructure and under the existing gas sales agreement.

Concurrently, the Board has intensified its ambition to divest or relinquish the balance of the non-core investments within the portfolio, as well as some historical early-stage seed investments that fall below disclosable thresholds, and announced post period that it had signed Heads of Terms with Levant Exploration and Production Corp. ("Levant") on 21 March 2019 for the divestment of Solo's 28.56% in Reef Resources Limited ("Reef") to Levant.

Resourcing to deliver the strategic vision

To coincide with the new strategic objectives of the Company, the Board underwent a significant reconstitution through 2018. With an increasing focus on commercialisation of the opportunities and value realisation of the portfolio, it was a logical time to change the composition and experience of the Board.

To this end, Jon Fitzpatrick was appointed to the Board as a Non-Executive Director in May and Neil Ritson stepped down from his position as Executive Chairman in August. I took on the Chairman role at the AGM on 6 August, initially in a non-executive capacity. I have subsequently become Executive Chairman post period following the resignation of Dan Maling from his role as Managing Director. The Board's reconstitution was completed in December with the appointment of Tom Reynolds as Non-Executive Director prior to year-end.

I am proud to oversee a Board with such a depth of experience and operational, technical and commercial expertise. The strength of our Board is one of the key aspects to Solo's investment proposition and reflects our intent. We have set ambitious growth targets and I have no doubt that we have the right team to be able to surpass these targets. It is worth highlighting that the Board of Directors hold 7% of the shares in issue, ensuring firm alignment with our shareholders and strong incentivisation to deliver value.

Beyond the strength of the Board, we also possess a highly credible Senior Management team seconded to us by Gneiss Energy, an advisory firm that have been instrumental in providing insight and strategic counsel to Solo as it continues through its evolution. Through our consultancy arrangement with Gneiss Energy, we are able to benefit from the considerable commercial and technical expertise of the team, namely Doug Rycroft as General Manager and John Daniel as Technical Advisor, whilst maintaining a strict cost discipline.

Cost discipline is a key focus for the Board, and whilst exceptional costs will be incurred as we seek to execute transactions, we continue to review cost cutting initiatives on G&A. Following the full repayment of Solo's convertible loan facility, Solo has a solid financial footing with zero debt and cash of GBP2,999,000 at period-end.

Since taking the role of Chairman in August, I have made Governance a priority objective, as the Board ensures the Company is run in an appropriate manner for the benefit of its shareholders. Through the second half of the year we implemented a thorough review of all aspects of the Company's processes and systems to ensure a robust and effective Governance platform is in place, upon which we can deliver long-term growth.

Joint Venture management has also been a key aspect of our focus as we sought to improve two-way communication and ensure that Solo's objectives with regards to JV investments are appropriately considered.

Outlook

I hope that this is the last report that I will write for the Company in its current form. We are on the cusp of true transformation that is not reliant on outcomes outside of our control, such as success with the drill-bit or government approvals. Whilst we are pragmatic about the challenges that remain with regards to achieving our strategic vision, we are confident that we have the capabilities to significantly grow the business, and we are encouraged by the discussions that we are having with regards to business development. As set out in the post-period strategy update, we are looking to move on acquisition opportunities that diversify the portfolio and provide the Company with cash flow. We are very mindful that we wish to achieve this growth without raising substantial equity and thereby diluting existing shareholders in the process and are confident that we can employ funding mechanisms that deliver this objective. We continue to be engaged in a number of ongoing processes and hope to update shareholders on successful outcomes through 2019.

Conclusion

In summary, your Board is pleased with the progress delivered in 2018, particularly with regards to the establishment and implementation of strategies that will enable it to deliver long-term, sustainable growth. A significant amount of work has gone on behind the scenes to set the Company on a path to value creation, and this may not be obvious when looking in from the outside and is certainly not reflected in our current market value. We recognise that our success will ultimately be judged on delivery of this stated strategy and we are confident that 2019 will be a transformational year for the Company and its shareholders.

Alastair Ferguson

Chairman

28 June 2018

SOLO OIL PLC

STATEMENT OF COMPREHENSIVE INCOME

FOR THE YEARED 31 DECEMBER 2018

 
                                                2018       2017 
                                     Notes    GBP000     GBP000 
 
Revenue from contracts with 
 customers                             4           -        614 
Gain on sale of investment             4       1,758          - 
Proceeds from shares held for 
 trading                               4       2,461          - 
Cost of sales                                (2,442)          - 
 
 
 
Gross profit                                   1,777        614 
 
Administrative expenses                      (1,974)      (1,261) 
Operating expenses                             (181)         (87) 
 
 
 
Operating loss                         5       (378)        (734) 
 
Impairment charge                              (692)        (300) 
Amortisation charge                   12           -        (484) 
Investment revenues                               57         66 
Finance costs                          7        (41)        (126) 
Fair value through profit and 
 loss                                  8       (529)          - 
Foreign Exchange Losses                         (84)         (81) 
 
 
 
Loss before taxation                         (1,667)      (1,659) 
 
Income tax expense                     9           -          - 
 
 
 
Loss and total comprehensive 
 income for the year                         (1,667)      (1,659) 
 
 
 
Other comprehensive income 
Decrease in value of available for sale 
 assets                                            -        (577) 
 
 
 
Total comprehensive income for the year 
 attributable to equity shareholders of 
 the parent                                  (1,667)      (2,236) 
 
 
 
Earnings per share (pence) 
Basic and diluted                     10      (0.33)       (0.43) 
 
 
 
 

SOLO OIL PLC

STATEMENT OF FINANCIAL POSITION

AS AT 31 DECEMBER 2018

 
                                          2018       2017 
                              Notes     GBP000     GBP000 
 
Non-current assets 
Intangible assets              11       15,119     13,816 
Oil & gas properties           12          194        194 
Available for sale assets      14            -      3,226 
Investments                    13        2,903          - 
 
 
 
                                        18,216     17,236 
 
 
 
Current assets 
Shares held for trading        13        1,523          - 
Trade and other receivables    16          716      1,395 
Cash and cash equivalents                2,999        396 
 
 
 
                                         5,238      1,791 
 
 
 
Total assets                            23,454     19,027 
 
 
 
Current liabilities 
 
Trade and other payables       18          548        324 
Borrowings                     17            -      1,080 
Provisions                     19          184          - 
 
 
 
                                           732      1,404 
 
 
 
Net current assets                       4,506        387 
 
 
 
Total liabilities                          732      1,404 
 
 
 
Net assets                              22,722     17,623 
 
 
 
Equity 
 
Called up share capital        20        1,264        785 
Share premium account          20       37,316     31,749 
Deferred share capital         20        1,831      1,831 
Share based payments           21        1,135      1,129 
AFS reserve                                  -        (693) 
Retained earnings                     (18,824)     (17,178) 
 
 
 
Total equity                            22,722     17,623 
 
 
 
 

SOLO OIL PLC

STATEMENT OF CASH FLOWS

FOR THE YEARED 31 DECEMBER 2018

 
                                                  2018                       2017 
                                Notes    GBP000           GBP000    GBP000           GBP000 
 
 Cash flows from operating 
  activities 
 Cash absorbed by operations     27                        (266)                      (794) 
                                                        --------                   -------- 
 
 Net cash outflow from 
  operating activities                                     (266)                      (794) 
 
 Investing activities 
 Purchase of intangible 
  assets                                (1,341)                    (2,080) 
 Proceeds on disposal of 
  investments                                 -                    (1,276) 
 Interest received                           57                         66 
                                       --------                   -------- 
 
 Net cash used in investing 
  activities                                             (1,284)                    (3,290) 
 
 Financing activities 
 Proceeds from issue of 
  shares                                  5,431                      3,200 
 Share issue costs                        (311)                      (274) 
 Finance costs                                -                      (126) 
 Repayment of borrowings                  (967)                      1,080 
                                       --------                   -------- 
 
 Net cash generated from 
  financing activities                                     4,153                      3,880 
                                                        --------                   -------- 
 
 Net increase/(decrease) in cash 
  and cash equivalents                                     2,603                      (204) 
 
 Cash and cash equivalents at 
  beginning of year                                          396                        600 
                                                        --------                   -------- 
 
 Cash and cash equivalents at 
  end of year                                              2,999                        396 
                                                        ========                   ======== 
 
 The above Cash Flow should be read in conjunction with the accompanying 
  notes. 
 

SOLO OIL PLC

STATEMENT OF CHANGES IN EQUITY

FOR THE YEARED 31 DECEMBER 2018

 
                          Share      Share   Deferred      Share        AFS   Retained     Total 
                        capital    premium      share      based    reserve   earnings 
                                   account    capital   payments 
                Notes    GBP000     GBP000     GBP000     GBP000     GBP000     GBP000    GBP000 
 
Balance at 1 January 
 2017                       699     27,559      1,831        933      (116)   (15,519)    15,387 
 
Year ended 31 
December 2017: 
Loss and total 
 comprehensive income 
 for 
 the year                     -          -          -          -          -    (1,659)     (1,659) 
Issue of share capital       86      4,464          -          -          -          -     4,550 
Share-based payment 
 charge                       -          -          -        196          -          -       196 
Cost of share issue           -      (274)          -          -          -          -       (274) 
Decrease in value of 
 available for sale 
 assets                       -          -          -          -      (577)          -       (577) 
 
 
 
Balance at 31 December 
 2017                       785     31,749      1,831      1,129      (693)   (17,178)    17,623 
 
 
 
Year ended 31 
December 2018: 
Loss and total 
 comprehensive income 
 for 
 the year                     -          -          -          -          -    (1,667)     (1,667) 
Issue of share capital      479      5,567          -          -          -          -     6,046 
Share-based payment 
 charge                       -          -          -         27          -          -        27 
Transfers                     -          -          -          -        693          -       693 
Release of expired 
 share options                -          -          -       (21)          -         21         - 
 
 
 
Balance at 31 December 
 2018                     1,264     37,316      1,831      1,135          -   (18,824)    22,722 
 
 
 
 

SOLO OIL PLC

NOTES TO THE FINANCIAL STATEMENTS

FOR THE YEARED 31 DECEMBER 2018

 
1  Accounting policies 
   Company information 
   Solo Oil plc ("Solo", the "Company", or together with its subsidiary, 
    the "Group") is a public listed company incorporated in England 
    & Wales. The address of its registered office 1 Park Row, Leeds, 
    United Kingdom, LS1 5AB. The Company's ordinary shares are traded 
    on the AIM Market operated by the London Stock Exchange. The 
    financial statements of Solo Oil plc for the year ended 31 December 
    2018 were authorised for issue by the Board on 28 June 2019 and 
    the balance sheet signed on the Board's behalf by Mr Fergusson 
    and Mr Reynolds. 
    Investing policy 
    Solo's investing policy is to acquire a diverse portfolio of 
    direct and indirect interests in exploration, development and 
    production oil and gas assets, and any other subsurface gas assets 
    of potential commercial significance, located worldwide but predominantly 
    in the Americas, Europe or Africa. 
    The Company may invest by way of outright acquisition or by the 
    acquisition of assets, including the intellectual property, of 
    relevant business, partnerships or joint venture arrangements. 
    Such investments may result in the Company acquiring the whole 
    part of a company or project (which in the case of an investment 
    in a company may be private or listed on a stock exchange, and 
    which may be pre-revenue), may constitute a minority stake in 
    the company or project in question and may take the form of equity, 
    joint venture debt, convertible instruments, license rights, 
    or other financial instruments as the Directors deem appropriate. 
    Solo intends to be a long-term investor and the Directors will 
    place no minimum or maximum limit on the length of time that 
    any investment may be held. 
    There is no limit on the number of projects into which the Company 
    may invest, nor the proportion of the Company's gross assets 
    that any investment may represent at any time and the Company 
    will consider possible opportunities anywhere in the world. 
    All of Solo's assets will be held in its own name, or through 
    wholly owned subsidiaries. 
    Statement of compliance with IFRS 
    The financial statements have been prepared in accordance with 
    International Financial Reporting Standards (IFRS) as adopted 
    by the European Union and as applied in accordance with the provisions 
    of the Companies Act 2006. The principal accounting policies 
    adopted by the Company are set out below. 
 
   Accounting convention 
   The financial statements have been prepared on the historical 
    cost basis, except for the measurement to fair value of assets 
    and financial instruments as described in the accounting policies 
    below, and on a going concern basis. 
    The financial report is presented in Pound Sterling (GBP) and 
    all values are rounded to the nearest thousand pounds (GBP'000) 
    unless otherwise stated. 
 
 
1  Accounting policies 
 
   Going concern 
   The Directors noted the losses that the Company has made for 
    the Year Ended 31 December 2018. The Directors have prepared 
    cash flow forecasts for the period ending 30 June 2020 which 
    take account of the current cost and operational structure of 
    the Company. 
    The cost structure of the Company comprises a high proportion 
    of discretionary spend and therefore in the event that cash flows 
    become constrained, costs can be quickly reduced to enable the 
    Company to operate within its available funding. 
    These forecasts, demonstrate that the Company has sufficient 
    cash resources available to allow it to continue in business 
    for a period of at least twelve months from the date of approval 
    of these financial statements. Accordingly, the financial statements 
    have been prepared on a going concern basis. 
    It is the prime responsibility of the Board to ensure the Company 
    remains a going concern. At 31 December 2018 the Company had 
    cash and cash equivalents of GBP2,999,056 and borrowings of GBPnil. 
    The Company has minimal contractual expenditure commitments and 
    the Board considers the present funds sufficient to maintain 
    the working capital of the Company for a period of at least 12 
    months from the date of signing in the Annual Report and Financial 
    Statements. For these reasons the Directors adopt the going concern 
    basis in the preparation of the Financial Statements. 
 
   Revenue recognition 
   Revenue is recognised to the extent that the right to consideration 
    is obtained in exchange for performance. Payment received in 
    advance of performance is deferred on the balance sheet as a 
    liability and released as services are performed or products 
    are exchanged as per the agreement with the customer. 
    Revenue is generated from one main source of income currently. 
    In the current year, revenue is being generated from the Company's 
    Farm-in interests, on an accrued monthly basis, along with associated 
    costs. 
    Revenue from the production of gas, in which the Company has 
    an interest with other producers, is recognised based on the 
    Company's working interest and the terms of the relevant production 
    sharing contracts. Differences between gas lifted and sold and 
    the Company's share of production are not significant. 
 
   Intangible assets 
   Externally acquired intangible assets comprising deferred exploration 
    and evaluation expenditure are initially recognised at cost in 
    compliance with IFRS 6 "Exploration for an evaluation of mineral 
    resources." 
    The Company follows the successful efforts method of accounting 
    for exploration and evaluation expenditure. All license, acquisition, 
    exploration and evaluation costs are capitalised in cost centres 
    by area of interest pending determination of the commercial viability 
    of the relevant product. 
 
   Borrowings 
   Borrowings are recognised initially at fair value, net of any 
    applicable transaction costs incurred. Borrowings are subsequently 
    carried at amortised cost; any difference between the proceeds 
    (net of transaction costs) and the redemption value is recognised 
    in the income statement over the period of the borrowings using 
    the effective interest method (if applicable). 
    Interest on borrowings is accrued as applicable to that class 
    of borrowing. 
 
 
1  Accounting policies 
 
   Impairment of tangible and intangible assets 
   At each balance sheet date the Group reviews the carrying amounts 
    of its tangible and intangible assets to determine whether there 
    is any indication that those assets have suffered an impairment 
    loss. If there is such indication then an estimate of the asset's 
    recoverable amount is performed and compared to the carrying 
    amount. 
    Recoverable amount is the higher of fair value less costs to 
    sell and value in use. In assessing value in use, the estimated 
    future cash flows are discounted at their present value. Where 
    the asset does not generate cash flows that are independent from 
    other assets, the Group estimated the recoverable amount of the 
    cash-generating unit to which the asset belongs. 
    If the recoverable amount of an asset is estimated to be less 
    than its carrying amount, the carrying amount of the assets is 
    reduced to its recoverable amount. An impairment loss is recognised 
    as an expense immediately, unless the relevant asset is carried 
    at a re-valued amount, in which case the impairment loss is treated 
    as a revaluation decrease, 
    Where an impairment loss subsequently reverses, the carrying 
    amount of the asset is increased to the revised estimate of its 
    recoverable amount, but so that the increased carrying amount 
    does not exceed the carrying amount that would have been determined 
    had no impairment loss been recognised for the asset in prior 
    periods. A reversal of an impairment loss is recognised as income 
    immediately, unless the relevant asset is carried at a re-valued 
    amount, in which case the reversal of the impairment loss is 
    treated as a revaluation increase. 
 
   Available for sale financial assets 
   Available-for-sale financial assets are non-derivative financial 
    assets that are either designated to this category or do not 
    qualify for inclusion in any of the other categories of financial 
    assets. The Group's available-for-sale assets include unlisted 
    securities. These available-for-sale financial assets are measured 
    at fair value. Gains and losses are recognised in other comprehensive 
    income and reported within the available-for-sale reserve within 
    equity, except for impairment losses and foreign exchange differences, 
    which are recognised in profit or loss. When the asset is disposed 
    of or is determined to be impaired, the cumulative gain or loss 
    recognised in other comprehensive income is reclassified from 
    the equity reserve to profit or loss and presented as a reclassification 
    adjustment within other comprehensive income. Interest calculated 
    using the effective interest method and dividends are recognised 
    in profit or loss within finance income. 
 
   Fair value measurement 
   IFRS 13 establishes a single source of guidance for all fair 
    value measurements. IFRS 13 does not change when an entity is 
    required to use fair value, but rather provides guidance on how 
    to measure fair value under IFRS when fair value is required 
    or permitted. The resulting calculations under IFRS 13 affected 
    the principles that the Company uses to assess the fair value, 
    but the assessment of fair value under IFRS 13 has not materially 
    changed the fair values recognised or disclosed. IFRS 13 mainly 
    impacts the disclosures of the Company. It requires specific 
    disclosures about fair value measurements and disclosures of 
    fair values, some of which replace existing disclosure requirements 
    in other standards. 
 
 
1  Accounting policies 
 
   Financial instruments 
   Financial assets and financial liabilities are recognised on 
    the balance sheet when the Company has become a party to the 
    contractual provisions of the instrument. 
    Cash and cash equivalents 
    Cash and cash equivalents comprise cash in hand, cash at bank 
    and short term deposits with banks and similar financial institutions. 
    Trade and other receivables 
    Trade and other receivables do not carry any interest and are 
    stated at their nominal value as reduced by appropriate allowances 
    for estimated irrecoverable amounts. 
    Financial liability and equity 
    Financial liabilities and equity instruments are classified according 
    to the substance of the contractual arrangements entered into. 
    An equity instrument is any contract that evidences a residual 
    interest in the assets of the Company after deducting all of 
    its liabilities. 
    Trade and other payables 
    Trade and other payables are non interest bearing and are stated 
    at their nominal value. 
    Equity instruments 
    Equity instruments issued by the Company are recorded at the 
    proceeds received, net of direct issue costs. 
 
   Financial assets at fair value through profit or loss 
         Financial assets are classified as at FVTPL when the financial 
          asset is held for trading. This is the case if: 
 
           *    the asset has been acquired principally for the 
                purpose of selling in the near term, or 
 
 
           *    on initial recognition it is part of a portfolio of 
                identified financial instruments that the company 
                manages together and has a recent actual pattern of 
                short-term profit taking, or 
 
 
           *    it is a derivative that is not designated and 
                effective as a hedging instrument. 
 
 
          Financial assets at FVTPL are stated at fair value with any gains 
          or losses arising on remeasurement recognised in profit or loss. 
          The net gain or loss recognised in profit or loss incorporates 
          any dividend or interest earned on the financial asset. Interest 
          and dividends are included in 'Investment income' and gains and 
          losses on remeasurement included in 'other gains and losses' 
          in the statement of comprehensive income. 
 
   Equity reserves 
   Share capital is determined using the nominal value of shares 
    that have been issued. 
    The share premium account represents premiums received on the 
    initial issuing of the share capital. Any transaction costs associated 
    with the issuing of shares are deducted from share premium, net 
    of any related income tax benefits. 
    The share based payment reserve represents the cumulative amount 
    which has been expensed in the income statement in connection 
    with share based payments, less any amounts transferred to retained 
    earnings on the exercise of share options. 
    Available for Sale Financial Asset reserve represents the market 
    value movement of AFS investments. 
    Retained earnings includes all current and prior period results 
    as disclosed in the income statement. 
 
 
1  Accounting policies 
 
   Taxation 
   The tax expense represents the sum of the current tax and deferred 
    tax. 
 
   Current tax 
   The current tax is based on taxable profit for the period. Taxable 
    profit differs from net profit as reported in the income statement 
    because it excludes items of income or expense that are taxable 
    or deductible in other periods and it further excludes items 
    that are never taxable or deductible. The liability for current 
    tax is calculated by using tax rates that have been enacted or 
    substantively enacted by the balance sheet date. 
 
   Deferred tax 
   Deferred tax is the tax expected to be payable or recoverable 
    on differences between the carrying amount of assets and liabilities 
    in the financial statements and the corresponding tax bases used 
    in the computation of taxable profit, and is accounted for using 
    the balance sheet liability method. Deferred tax liabilities 
    are recognised for all taxable temporary differences and deferred 
    tax assets are recognised to the extent that it is probable that 
    taxable profits will be available against which deductible temporary 
    differences can be utilised. Such assets and liabilities are 
    not recognised if the temporary difference arises from goodwill 
    or from the initial recognition (other than in a business combination) 
    of other assets and liabilities in a transaction which affects 
    neither the tax profit not the accounting profit. 
 
   Provisions 
   Provisions are recognised for liabilities of uncertain timings 
    or amounts that have arisen as a result of past transactions 
    and are discounted at a pre-tax rate reflecting current market 
    assessments of the time value of money and the risks specific 
    to the liability. 
 
   Share-based payments 
   Where share options are awarded to employees, the fair value 
    of the options at the date of grant is charged to the income 
    statement over the vesting period. Non-market vesting conditions 
    are taken into account by adjusting the number of equity instruments 
    expected to vest at each balance sheet date so that, ultimately, 
    the cumulative amount recognised over the vesting period is based 
    on the number of options that eventually vest. Market vesting 
    conditions are factored into the fair value of the options granted. 
    As long as all other vesting conditions are satisfied, a charge 
    is made irrespective of whether the market vesting conditions 
    are satisfied. The cumulative expense is not adjusted for failure 
    to achieve a market vesting condition. 
    Where the terms and conditions of options are modified before 
    they vest, the increase in the fair value of the options, measured 
    immediately before and after the modification, is also charged 
    to the income statement over the remaining vesting period. 
    Where equity instruments are granted to persons other than employees, 
    the income statement is charged with the fair value of goods 
    and services received. Equity-settled share-based payments are 
    measured at a fair value at the date of grant except if the value 
    of the service can be reliably established. The fair value determined 
    at the grant date of equity-settled share-based payments is expensed 
    on a straight-line basis over the vesting period, based on the 
    Company's estimate of shares that will eventually vest. 
 
   Foreign exchange 
   Transactions in currencies other than Sterling are recorded at 
    the rates of exchange prevailing on the dates of the transactions. 
    At each balance sheet date, monetary assets and liabilities that 
    are denominated in foreign currencies are retranslated at the 
    rates prevailing on the balance sheet date. Gains and losses 
    arising on retranslation are included in the income statement 
    for the period. 
 
 
1  Accounting policies 
 
   Oil and gas properties and other property, plant and equipment 
   (i) Initial recognition 
    Oil and gas properties and other property, plant and equipment 
    are stated at cost, less accumulated depreciation and accumulated 
    impairment losses. 
    The initial cost of an asset comprises its purchase price or 
    construction cost, any costs directly attributable to bringing 
    the asset into operation, the initial estimate of the decommissioning 
    obligation and, for qualifying assets (where relevant), borrowing 
    costs. The purchase price or construction cost is the aggregate 
    amount paid and the fair value of any other consideration given 
    to acquire the asset. The capitalised value of a finance lease 
    is also included within property, plant and equipment. 
    When a development project moves into the production stage, the 
    capitalisation of certain construction/development costs ceases, 
    and costs are either regarded as part of the cost of inventory 
    or expensed, except for costs which qualify for capitalisation 
    relating to oil and gas property asset additions, improvements 
    or new developments. 
    (ii) Depreciation/amortisation 
    Oil and gas properties are depreciated/amortised on a unit-of 
    production basis over the total proved developed and undeveloped 
    reserves of the field concerned, except in the case of assets 
    whose useful life is shorter than the lifetime of the field, 
    in which case the straight-line method is applied. Rights and 
    concessions are depleted on the unit-of-production basis over 
    the total proved developed and undeveloped reserves of the relevant 
    area. 
    The unit-of production rate calculation for the depreciation/amortisation 
    of field development costs takes into account expenditures incurred 
    to date, together with sanctioned future development expenditure. 
    An item of property, plant and equipment and any significant 
    part initially recognised is derecognised upon disposal or when 
    no future economic benefits are expected from its use or disposal. 
    Any gain or loss arising on derecognition of the asset (calculated 
    as the difference between the net disposal proceeds and the carrying 
    amount of the asset) is included in the statement of profit or 
    loss and other comprehensive income when the asset is derecognised. 
    The asset's residual values, useful lives and methods of depreciation/amortisation 
    are reviewed at each reporting period and adjusted prospectively. 
    (iii) Major maintenance, inspection and repairs 
    Expenditure on major maintenance refits, inspections or repairs 
    comprises the cost of replacement assets or parts of asset, inspection 
    costs and overhaul costs. Where an asset, or part of an asset 
    that was separately depreciated and is now written off is replaced 
    and it is probably that future economic benefits associated with 
    the item will flow to the Company, the expenditure will be capitalised. 
    Where part of the asset replaced was not separately considered 
    as a component and therefore not depreciated separately, the 
    replacement value is used to estimate the carrying amount of 
    the replaced asset(s) and is immediately written off. Inspection 
    costs associated with major maintenance programmes are capitalised 
    and amortised over the period of the next inspection. All other 
    day-to-day repairs and maintenance costs are expensed as incurred. 
 
 
1  Accounting policies 
 
   Provision for rehabilitation / Decommissioning Liability 
   The Company recognises a decommissioning liability where it has 
    a present legal or constructive obligation as a result of past 
    events, and it is probably that an outflow of resources will 
    be required to settle the obligation, and a reliable estimate 
    of the amount of obligation can be made. 
    The obligation generally arises when the asset is installed or 
    the ground/environment is disturbed at the field location. When 
    the liability is initially recognised, the present value of the 
    estimated costs is capitalised by increasing the carrying amount 
    of the related oil and gas assets to the extent that it is incurred 
    by the development/construction of the field. Any decommissioning 
    obligations that arise through the production of inventory are 
    expensed when the inventory item is recognised in cost of goods 
    sold. 
    Changes in the estimated timing or cost of decommissioning are 
    dealt with prospectively by recording an adjustment to the provision 
    and a corresponding adjustment to oil and gas assets. Any reduction 
    in the decommissioning liability and, therefore, any deduction 
    from the asset to which it relates, may not exceed the carrying 
    amount of that asset. If it does, any excess over the carrying 
    value is taken immediately to the statement of profit or loss 
    and other comprehensive income. 
 
 
2  Adoption of new and revised standards and changes in accounting 
    policies 
 
   In the current year, the following new and revised Standards 
    and Interpretations have been adopted by the company and have 
    an effect on the current period or a prior period or may have 
    an effect on future periods: 
    IFRS 15, Revenue from Contracts with Customers has been adopted 
    in the current year. IFRS 15 requires entities to exercise judgement, 
    taking into consideration all of the relevant facts and circumstances 
    when applying each step of the model to contracts with their 
    customers. The standard also specifies the accounting for the 
    incremental costs of obtaining a contract and the costs directly 
    related to fulfilling a contract. In addition, the standard requires 
    extensive disclosures. 
    The entity adopted IFRS 15 using the full retrospective method 
    of adoption. The effect of the transition on the current period 
    has not been disclosed as the entity has adopted practical expedient 
    1 and 4 permitted by IFRS 15. The entity did not apply any of 
    the other available optional practical expedients. 
    IFRS 9 Financial Instruments replaces IAS 39 Financial Instruments: 
    Recognition and Measurement for annual periods beginning on or 
    after 1 January 2018, bringing together all three aspects of 
    the accounting for financial instruments: classification and 
    measurement and impairment. 
    The entity has applied IFRS 9 retrospectively, with the initial 
    application date of 1 January 2018 and adjusting the comparative 
    information for the period beginning 1 January 2017. 
 
   Standards which are in issue but not yet effective 
 
   At the date of authorisation of these financial statements, the 
    following Standards and Interpretations, which have not yet been 
    applied in these financial statements, were in issue but not 
    yet effective (and in some cases had not yet been adopted by 
    the EU): 
 
                                                                                 Effective from: 
   IFRS 16                   Leases                                              1 January 2019 
 
   IFRS 9 (amendments)       Prepayment features with negative                   1 January 2019 
                              compensation 
 
   IAS 28 (amendments)       Long-term interests in associates                   1 January 2019 
                              and joint ventures 
 
   Annual improvements       Amendments to IFRS 3 Business                       1 January 2019 
    to IFRS Standards         Combinations, IFRS 11 Joint Arrangements, 
    2015-2017 Cycle           IAS 12 Income Taxes, IAS 23 Borrowing 
                              Costs 
 
 
 
3  Critical accounting estimates and judgements 
 
         The company makes estimates and assumptions regarding the future. 
          Estimates and judgements are continually evaluated based on historical 
          experience and other factors, including expectations of future 
          events that are believed to be reasonable under the circumstances. 
          In the future, actual experience may differ from these estimates 
          and assumptions. The estimates and assumptions that have a significant 
          risk of causing a material adjustment to the carrying amounts 
          of assets and liabilities within the next financial year are 
          discussed below. 
          Useful lives of intangible assets and property, plant and equipment 
          Intangible assets and property, plant and equipment are amortised 
          or depreciated over their useful lives. Useful lives are based 
          on the management's estimates of the period that the assets will 
          generate revenue, which are based on judgement and experience 
          and periodically reviewed for continued appropriateness. Changes 
          to estimates can result in significant variations in the carrying 
          value and amounts charged to the income statement in specific 
          periods. 
          Share-based payments 
          The Company utilised an equity-settled share-based remuneration 
          scheme for employees. Employee services received, and the corresponding 
          increase in equity, are measured by reference to the fair value 
          of the equity instruments at the date of grant, excluding the 
          impact of any non-market vesting conditions. The fair value of 
          share options are estimated by using Black-Scholes valuation 
          method as at the date of grant. The assumptions used in the valuation 
          are described in Note 22 and include, among others, the expected 
          volatility, expected life of the options and number of options 
          expected to vest. 
          Deferred taxation 
          Deferred tax assets are recognised when it is judged more likely 
          than not that they will be recovered. 
          Hydrocarbon reserve and resource estimates 
          Hydrocarbon reserves are estimates of the amount of hydrocarbons 
          that can be economically and legally extracted from the Company's 
          oil and gas properties. The Company estimates its commercial 
          reserves and resources based on information compiled by appropriately 
          qualified persons relating to the geological and technical data 
          on the size, depth, shape and grade of the hydrocarbon body and 
          suitable production techniques and recovery rates. Commercial 
          reserves are determined using estimates of oil and gas in place, 
          recovery factors and future commodity prices, the latter having 
          an impact on the total amount of recoverable reserves and the 
          proportion of the gross reserves which are attributable to the 
          host government under the terms of the Production-Sharing Agreements. 
          Future development costs are estimated using assumptions as to 
          the number of wells required to produce the commercial reserves, 
          the cost of such wells and associated production facilities, 
          and other capital costs. The current long-term gas price assumption 
          used in the estimation of commercial reserves currently held 
          by the Company is US$3/MMTBU. The carrying amount of oil and 
          gas development and production assets at 31 December 2018 is 
          shown in note 11. 
          The Company estimates and reports hydrocarbon reserves in line 
          with the principles contained in the SPE Petroleum Resources 
          Management Reporting System (PRMS) framework. As the economic 
          assumptions used may change and as additional geological information 
          is obtained during the operation of a field, estimates of recoverable 
          reserves may change. Such changes may impact the Company's financial 
          position and results which include: 
           *    The carrying value of exploration and evaluation 
                assets; oil and gas properties; property and plant 
                and equipment may be affected due to changes in 
                estimated future cash flows 
 
 
           *    Depreciation and amortisation charges in the income 
                statement may change where such charges are 
                determined using the Units of Production (UOP) method, 
                or where the useful life of the related assets change 
 
 
           *    Provisions for decommissioning may require revision - 
                where changes to the reserve estimates affect 
                expectations about when such activities will occur 
                and the associated cost of these activities. 
 
 
3  Critical accounting estimates and judgements 
 
         Exploration and evaluation expenditures 
          The application of the Company's accounting policy for exploration 
          and evaluation expenditure requires judgement to determine whether 
          future economic benefits are likely, from either future exploitation 
          or sale, or whether activities have not reached a stage which 
          permits a reasonable assessment of the existence of reserves. 
          The determination of reserves and resources is itself an estimation 
          process that involves varying degrees of uncertainty depending 
          on how the resources are classified. These estimates directly 
          impact when the Company defers exploration and evaluation expenditure. 
          The deferral policy requires management to make certain estimates 
          and assumptions about future events and circumstances, in particular, 
          whether an economically viable extraction operation can be established. 
          Any such estimates and assumptions may change as new information 
          becomes available. If, after expenditure is capitalised, information 
          becomes available suggesting that the recovery of the expenditure 
          is unlikely, the relevant capitalised amount is written off in 
          the income statement and in the period when the new information 
          becomes available. 
          Units of production (UOP) depreciation of oil and gas assets 
          Oil and gas properties are depreciated using the UOP method over 
          total proved development and undeveloped hydrocarbon reserves. 
          This results in a depreciation/amortisation charge proportional 
          to the depletion of the anticipated remaining production from 
          the field. 
          The life of each item, which is assessed at least annually, has 
          regard to both its physical life limitations and present assessments 
          of economically recoverable reserves of the field at which the 
          asset is located. These calculations require the use of estimates 
          and assumptions, including the amount of recoverable reserves 
          and estimates of future capital expenditure. The calculation 
          of the UOP rate of depreciation/amortisation will be impacted 
          to the extent that actual production in the future is different 
          from current forecast production based on total proved reserves, 
          or future capital expenditure estimates change. Changes to the 
          proved reserves could arise due to changes in the factors or 
          assumptions used in estimating reserves, including: 
           *    The effect on proved reserves of differences between 
                actual commodity prices and commodity price 
                assumptions 
 
 
           *    Unforeseen operational issues 
 
 
          Recoverability of oil and gas assets 
          The Company assesses each asset or cash generating unit (CGU) 
          each reporting period to determine whether any indication of 
          impairment exists. Where an indicator of impairment exists, a 
          formal estimate of the recoverable amount is made, which is considered 
          to be the higher of the fair value less costs of disposal (VLCD) 
          and value in use (VIU). The assessments require the use of estimates 
          and assumptions such as long-term oil prices (considering current 
          and historical prices, price trends and related factors), discount 
          rates, operating costs, future capital requirements, decommissioning 
          costs, exploration potential reserves (see(a) Hydrocarbon reserves 
          and resource estimates above) and operating performance (which 
          includes production and sales volumes). These estimates and assumptions 
          are subject to risk and uncertainty. Therefore, there is possibility 
          that changes in circumstances will impact these projections, 
          which may impact the recoverable amount of assets and/or CGUs. 
 
 
4   Revenue 
 
    An operating segment is a distinguishable component of the Company 
     that engages in business activities from which it may earn revenues 
     and incur expenses, whose operating results are regularly reviewed 
     by the Company's chief operating decision maker to make decisions 
     about the allocation of resources and assessment of performance 
     and about which discrete financial information is available. 
     The Company's current revenue from customers is all generated 
     in Tanzania from oil & gas production in accordance with its 
     farm-in/profit sharing agreements, within Tanzania. However with 
     this segment only in its second period of production, and with 
     the only major related transactions being the carrying value 
     of the oil & gas properties assets as described in Note 13, no 
     further segmental analysis is deemed useful to disclose currently. 
     This year's revenue from this segment was GBPnil (2017:GBP614,000). 
     During the current year, the company disposed of its entire 15% 
     interest in Horse Hill Developments Limited ("HHDL") to UK Oil 
     and Gas plc ("UKOG") for a total cash consideration of GBP4.5 
     million together with a simultaneous purchase of 234,042,221 
     new ordinary share in UKOG equivalent to a 4.2% interest in UKOG 
     at the time of the transaction. 
     For a total consideration of GBP4.5 million UKOG agreed to acquire 
     Solo's 15% shareholding and loan in HHDL. With an effective date 
     of 28 August 2018, the total consideration was satisfied through 
     the issue of 234,042,221 new ordinary shares in UKOG. This resulted 
     in a gain recognised of GBP1.758m in the current year. 
     Subject to further acquisitions, the Company expects to further 
     reviews its segmental information during the forthcoming financial 
     year and update accordingly. 
     In respect of the total assets, GBP5,069,000 (2017:GBP1,566,000) 
     arise in the UK and GBPnil (2017:GBPnil) arise in Canada, GBP18,385,000 
     in Tanzania (2017:GBP17,156,000), and GBPnil arise in Nigeria 
     (2017:GBPnil). 
 
5   Operating loss 
                                                                                 2018     2017 
                                                                               GBP000   GBP000 
    Operating loss for the year is stated after charging/(crediting): 
 Exchange losses                                                                   84       81 
 Fees payable to the company's auditor for the 
  audit of the company's financial statements                                      14       15 
 Depreciation of oil and gas property                                               -      484 
 Impairment of intangible assets                                                  692      300 
 Share-based payments                                                              27      196 
 Directors remuneration                                                           580      537 
 Directors pension contribution                                                     -       12 
 Salaries and national insurance                                                  114      101 
 
 
 
6   Employees 
 
    The average number of employees (excluding executive directors) 
     was: 
 
                                                                                 2018     2017 
 
                                                                                    1        1 
 
 
 
 
 
6   Employees 
 
                                                                                  2018    2017 
                                                                                GBP000  GBP000 
    Their aggregate remuneration comprised : 
 Wages and salaries                                                                 40      40 
 
 
 
 Directors remuneration                                                            607     641 
 
 
 
                                               Salary and  Share-based         Pension   Total 
                                                     fees     payments   contributions 
                                                   GBP000       GBP000          GBP000  GBP000 
    Year ended 31 December 2018 
 Neil Ritson (resigned 6 August 
  2018)                                                99            -               -      99 
 Don Strang (resigned 26 November 
  2018)                                                45            -               -      45 
 Dan Maling (resigned 7 February 
  2019)                                               220            -               -     220 
 Fergus Jenkins (including 
  termination provision)                               90            -               -      90 
 Jon FitzPatrick (appointed 
  2 May 2018)                                         107           27               -     134 
 Alastair Ferguson (appointed 
  6 August 2018)                                       19            -               -      19 
    Tom Reynolds (appointed 4 
     December 2018)                                     -            -               -       - 
 
 
 
                                                      580           27               -     607 
 
 
 
                                               Salary and  Share-based         Pension   Total 
                                                     fees     payments   contributions 
                                                   GBP000       GBP000          GBP000  GBP000 
    Year ended 31 December 2017 
 Neil Ritson                                          125           46               -     171 
 Don Strang                                            19           38               -      57 
 Dan Maling                                           180           60               -     240 
 Fergus Jenkins (including 
  termination provision)                              213           46              12     271 
 
 
 
                                                      537          190              12     739 
 
 
 
 
 
7   Finance costs 
                                                                               2018      2017 
                                                                             GBP000    GBP000 
 
 Interest on convertible loan notes                                              50        12 
 Finance fees                                                                     -       114 
 
 
 
 Total interest expense                                                          50       126 
 Exchange differences on financing transactions                                 (9)         - 
 
 
 
                                                                                 41       126 
 
 
 
8   Other gains and losses 
                                                                               2018      2017 
                                                                             GBP000    GBP000 
 
 Amounts written off fair value through profit/loss 
  of investments held for trading                                             (529)         - 
 
 
 
9   Income tax expense 
                                                                               2018      2017 
                                                                             GBP000    GBP000 
 
    UK corporation tax on profits for the current 
     period                                                                       -         - 
 
 
 
    Total UK current tax                                                          -         - 
 
 
 
    The charge for the year can be reconciled to the loss per the 
     income statement as follows: 
 
                                                                               2018      2017 
                                                                             GBP000    GBP000 
 
 Loss before taxation                                                       (1,667)     (1,659) 
 
 
 
    The reason for the difference between the actual tax charge for 
     the year and the standard rate of corporation tax in the UK applied 
     to profits for the year are as follows: 
 
 Expected tax credit based on a corporation 
  tax rate of 19.00%                                                          (317)       (315) 
 Effect of expenses not deductible in determining 
  taxable profit                                                                243        94 
 Income not taxable                                                           (347)         - 
 Change in unrecognised deferred tax assets                                     243         - 
 Deferred tax adjustments in respect of prior 
  years                                                                       (199)         - 
 Future income tax benefit not brought into 
  account                                                                       377       221 
 
 
 
 Taxation charge for the year                                                     -         - 
 
 
 
 
 
9     Income tax expense 
 
      No deferred tax asset has been recognised because there is uncertainty 
       of the timing of suitable future profits against which they can 
       be recovered. 
 
10   Loss per share 
 
     The calculation of loss per share is based on the loss after 
      taxation divided by the weighted average number of shares in 
      issue during the year. 
 
                                                                                      2018      2017 
                                                                                    GBP000    GBP000 
     Number of shares 
 Weighted average number of ordinary shares 
  for basic loss per share (000)                                                   509,360   384,700 
 
     Earnings 
     Continuing operations 
 Loss for the period from continued operations                                     (1,667)     (1,659) 
 
     Earnings per share for continuing operations 
 Basic and diluted loss per share (pence)                                           (0.33)      (0.43) 
 
 
 
 As inclusion of the potential ordinary shares would result in 
  a decrease in the loss per share they are considered to be anti-dilutive, 
  as such, a diluted loss per share is not included. 
 
 
 
11   Intangible assets 
                                                                                    Deferred exploration 
                                                                              and evaluation expenditure 
                                                                                                  GBP000 
     Cost 
 At 1 January 2017                                                                                14,394 
 Additions                                                                                         2,080 
 
 
 
 At 1 January 2018                                                                                16,474 
 Additions                                                                                         1,341 
 Foreign currency adjustments                                                                         (38) 
 
 
 
 At 31 December 2018                                                                              17,777 
 
 
 
     Impairment 
 At 1 January 2017                                                                                 2,358 
 Charge for the year                                                                                 300 
 
 
 
 At 1 January 2018                                                                                 2,658 
 
 
 
 At 31 December 2018                                                                               2,658 
 
 
 
     Carrying amount 
 At 31 December 2018                                                                              15,119 
 
 
 
 At 31 December 2017                                                                              13,816 
 
 
 
 The additions to deferred exploration and evaluation expenditure 
  during the period relate mainly to the completion of drilling 
  operations for the Ntorya-2 appraisal and subsequent testing 
  of the well. 
  Following a review of the carrying value and future prospects 
  for Solo's assets no impairment has been recongnised as the carrying 
  value is deemed appropriate based on the future outlook. As at 
  31 December 2017 the Ausable Reef intangible was fully impaired 
  with a resulting impairment charge of GBP0.30 million charged 
  to the profit and loss in 2017. 
 
 
 
12   Oil & Gas properties 
                                                                               2018                 2017 
                                                                             GBP000               GBP000 
     Cost 
 At 1 January 2018 and 31 December 2018                                         953                  953 
 
 
 
     Accumulated depreciation 
 At 1 January 2018                                                              759                  275 
 Charge for the year                                                              -                  484 
 
 
 
 At 31 December 2018                                                            759                  759 
 
 
 
     Carrying value 
 At 31 December 2018                                                            194                  194 
 
 
 
 At 31 December 2017                                                            194                  678 
 
 
 
     The Oil & Gas properties comprise the 7.55% participating interest 
      in the Kiliwani North Development Licence, in Tanzania. 
      Accumulated amortisation has been calculated on a units of production 
      basis. As there was no production during 2018, the amortisation 
      charge for the year is nil. 
      Impairment Review 
      The Directors have carried out an impairment review as at 31 
      December 2018, and determined that an impairment charge is not 
      currently required. The Directors based this assessment on continuing 
      operational work schedules that are ongoing to improve operational 
      efficiencies and production. 
 
13   Investments 
                                                                      Current           Non-current 
                                                                     2018    2017           2018    2017 
                                                                   GBP000  GBP000         GBP000  GBP000 
 
 Investments held at fair value 
  through other comprehensive 
  income                                                                -       -              -   3,226 
 Investments held at fair value 
  through profit or loss                                                -       -          2,903       - 
 Investments held for trading 
  through profit and loss                                           1,523       -              -       - 
 
 
 
                                                                    1,523       -          2,903   3,226 
 
 
 
 The company has not designated any financial assets that are 
  not classified as held for trading as financial assets at fair 
  value through profit or loss. 
 
 
 
13    Investments 
 
      Investments comprise of the acquisition of UKOG 234,042,221 new 
       ordinary shares equivalent to a 4.2% interest at the time of 
       acquisitions which was purchased on the completion of the sale 
       and purchase agreement ("SPA") to dispose of its entire 15% interest 
       in Horse Hill Developments Limited ("HHDL") to UKOG. 
       These shares are held for trading and traded at the discretion 
       of the board of directors. 
       Solo acquired a further 5% interest in Helium One on 22 January 
       2018 through a final subscription amount of GBP276,569. Helium 
       one owns exploration licences in a number of highly prospective, 
       and extremely rare, helium properties in Tanzania. The conditions 
       precedent to the Sale and Purchase Agreement ("SPA") have now 
       been fulfilled, including the consent of other shareholders and 
       the payment by Solo of the cash consideration of GBP650,000. 
       Testing at the Horse Hill-1 oil discovery is expected to commence 
       in early second quarter and is anticipated to lead to a declaration 
       of commerciality at the Portland Sandstone reservoir level where 
       initial testing in 2016 showed a potentially commercial rate 
       of 320 barrels oil per day ("bopd") on pump. Additional testing 
       of the Kimmeridge Limestone reservoirs will be undertaken in 
       a test program expected to last approximately 150 days in total. 
       Solo will now hold a 15% interest in HHDL equivalent to a 9.75% 
       interest in the Horse Hill licences, PEDL137 and PEDL246, and 
       the Horse Hill oil discovery 
 
14   Available for sale assets 
                                                                                   2018     2017 
                                                                                 GBP000   GBP000 
     Investment in listed and unlisted securities 
 Valuation at beginning of the year                                               3,226    1,181 
 Additions at cost                                                                  277    2,626 
 Disposal                                                                         (600)        (4) 
 Transfers to investments                                                       (2,903)        - 
 Decrease in value of investments - 
 Burj Africa                                                                          -      (577) 
 
 
 
 Valuation at the end of the year                                                     -    3,226 
 
 
 
     The available for sale investments 
     splits are as below: 
     Non-current assets - listed                                                      -        - 
 Non-current assets - unlisted                                                        -    3,226 
 
 
 
                                                                                      -    3,226 
 
 
 
 Available for sale-investments comprise investments in unlisted 
  securities and are held by the Company as a mix of strategic 
  and short term investment. 
  On 28 August 2018 Solo disposed of its interest in Horse Hill 
  Development Limited. 
  The remaining assets held for sale are no longer being held 
  for sale and have therefore been reclassified at their carrying 
  value to investments. 
 
15   Subsidiary company 
 
 The only subsidiary of Solo Oil Plc is Solo Oil International 
  Limited a wholly-owned, UK incorporated micro-entity, which is 
  dormant, and has been since incorporation with an issued share 
  capital of GBP1. 
 
 
 
16   Trade and other receivables 
 
                                                                           2018    2017 
                                                                         GBP000  GBP000 
 
 Trade receivables                                                          294     336 
 Other receivables                                                          300     282 
 Loan to Horse Hill Developments Ltd                                          -     749 
 Loan to Helium One Ltd                                                     100       - 
 Prepayments                                                                 22      28 
 
 
 
                                                                            716   1,395 
 
 
 
     The directors consider that the carrying amount of trade and 
      other receivables approximates to their fair value. 
 
17   Borrowings 
                                                                           2018    2017 
                                                                         GBP000  GBP000 
     Convertible Loan Note 
 First tranche drawn down of US $1.5m                                         -   1,080 
 
 
 
 The repayment terms of the convertible loan from Riverfort Global 
  Ltd are: 
  Each tranche carries an 18 month term with each tranche having 
  a 3 month repayment holiday followed by repayment of 10% of the 
  gross amount of principal per month such that 30% of the gross 
  principal remains outstanding at the end of 12 months. 
  The convertible loan has an interest rate charge of 8% per annum 
  of gross amount provided and is unsecured. 
  The first tranche of gross US $1.5m was drawn down in November 
  2017. On 18 June 2018 an exercise for conversion of US $116,168 
  into equity as received with a resulting allotment of 3,394,747 
  new ordinary shares at a conversion price of 2.56p per share. 
  On 3rd July, there was an allotment of 6,046,887 new ordinary 
  shares at a conversion price of 2.18p per share. On 13th July, 
  there was a further allotment of 3,058,641 new ordinary shares 
  at a conversion price of 2.06p per share. 
  The convertible loan was repaid in full during 2018, resulting 
  in a nil balance at 31 December 2018. 
 
 
 
18   Trade and other payables 
                                                                             Current 
                                                                                    2018     2017 
                                                                                  GBP000   GBP000 
 
 Trade payables                                                                      171      163 
 Accruals                                                                             93      128 
 Other payables                                                                      284       33 
 
 
 
                                                                                     548      324 
 
 
 
     The directors consider that the carrying amount of trade payables 
      approximates to their fair value. 
 
19   Provisions for liabilities 
                                                                                    2018     2017 
                                                                                  GBP000   GBP000 
 
 PAYE Settlement                                                                     184        - 
 
 
 
     Analysis of provisions 
     Provisions are classified based on the amounts that are expected 
      to be settled within the next 12 months and after more than 12 
      months from the reporting date, as follows: 
 
 Current liabilities                                                                 184        - 
 
 
 
     Movements on provisions:                                                     PAYE Settlement 
                                                                                           GBP000 
 
     At 1 January 2018                                                                          - 
 Additional provisions in the year                                                            184 
     Utilisation of provision                                                                   - 
 
 
 
 At 31 December 2018                                                                          184 
 
 
 
 The provision relates to the amounts owed by Daniel Maling, 
  former Managing Director for the PAYE on the share settled 
  transactions. If this remains unpaid by Daniel Maling this 
  will be due to HMRC on 6th July 2019. 
 
 
 
20   Share capital 
                                                                             Number of shares     Nominal value 
 
                                                                                                         GBP000 
a)   Called up, allotted, issued and fully paid: Ordinary shares of 
      0.2p each 
     As at 31 December 2017                                                       392,337,800               785 
 
 
 
     27 February 2018 - placing for cash at 
      0.35p                                                                        57,142,857               114 
     9 March 2018 - placing for share of HHDL 
      at 0.351p                                                                     9,973,011                20 
     18 June 2018 - allotment for Convertible 
      Loan Note at 0.256p                                                           3,394,747                 7 
     3rd July 2018 - allotment for convertible 
      loan note at 0.218p                                                           6,046,887                13 
     11th July 2018 - allotment for convertible 
      loan note at 0.206p                                                           3,058,641                 6 
     6 August 2018 - placing for cash at 0.225p                                   107,310,847               215 
     12 September 2018 - placing for cash at 
      0.2p                                                                         52,439,328               105 
 
 
 
     As at 31 December 2018                                                       631,704,118             1,265 
 
 
 
                                                                                         2018              2017 
                                                                                       GBP000            GBP000 
b)   Deferred shares 
     Deferred shares of 265,324,634 at 0.69 
      pence each                                                                        1,831             1,831 
 
 
 
c)   Total Share options in issue 
     During the year no options were granted (2017:nil). 
 
     As at 31 December 2018, the unexercised options in issue were 
      restated as: 
 
     Exercise Price               Amended        Expiry Date                          Amended  Original Options 
      (original)                                                                                       in Issue 
                                                                                                    31 December 
                                                                                                           2018 
     0.5p                         10p            31 December 2020                  10,200,000       204,000,000 
     0.5p                         10p            31 December 2020                   3,425,000        68,500,000 
     0.3p                         6p             31 December 2020                   5,000,000       100,000,000 
     0.35p                        7p             31 October 2021                   10,625,000       212,500,000 
 
 
 
                                                                                   29,250,000       585,000,000 
 
 
 
d)   Total warrants in issue 
     1,597,658 warrants lapsed in the year and no warrants were issued, 
      cancelled or exercised during the year (2017: nil). 
 
     As at 31 December 2018 there were 3,547,129 at 2.25p outstanding 
      (31 December 2017 3,500,000 at 7.25p and 1,597,658 at 24p and 
      13.8p.) 
 
 
 
21   Share based payment 
 
     The Company used the Black-Scholes model to determine the value 
      of the options and the inputs were as follows: 
 
                                                                                   Issue 12/02/2018 
 Share price at grant (pence)                                                                 0.032 
 Fair Value at grant (pence)                                                                 0.0109 
 Expected volatility (%)                                                                      82.2% 
     Expected life (years)                                                                  3 years 
 Risk free rate (%)                                                                           0.61% 
 Expected dividends (pence)                                                                     nil 
 
 Expected volatility was determined by using the Company's share 
  price for the preceding 12 months. 
 
 The total share-based payment expense in the year for the Company 
  was GBP27,000 in relation to issue of options (2017: GBP196,000) 
  and GBPnil finance charges in relation to warrants (2017: nil). 
 
 Employee Benefit Trust 
 
 The Company established on 7 December 2012, an employee benefit 
  trust called the Solo Oil Employee Benefit Trust ("EBT") to 
  implement the use of the Company's existing share incentive 
  plan over 5% of the Company's issued share capital from time 
  to time in as efficient a manner as possible for the beneficiaries 
  of that plan. The EBT is a discretionary trust for the benefit 
  of directors and employees of the Company and its subsidiaries. 
 
 No further subscriptions for shares in the Company has been 
  made by the EBT during the years ended 31 December 2018 and 
  2017. 
 
22   Financial instruments 
 
       The Company is exposed through its operations to one or more of 
        the following financial risk: 
         *    Fair value or cash flow interest rate risk 
 
 
         *    Foreign currency risk 
 
 
         *    Liquidity risk 
 
 
         *    Credit risk 
 
 
         *    Market risk 
 
 
         *    Expected credit losses 
 
 
        Policy for managing these risks is set by the Board. The policy 
        for each of the above risks is described in more detail below. 
        Fair value and cashflow interest rate risk 
        Generally the Company has a policy of holding debt at a floating 
        rate. The directors will revisit the appropriateness of this policy 
        should the Company's operations change in size or nature. Operations 
        are not permitted to borrow long-term from external sources locally. 
 
 Foreign currency risk 
 Foreign exchange risk arises because the Company has operations 
  located in various parts of the world whose functional currency 
  is not the same as the functional currency in which the company's 
  investments are operating. The Company's net assets are exposed 
  to currency risk giving rise to gains or losses on retranslation 
  into sterling. Only in exceptional circumstances will the Company 
  consider hedging its net investments in overseas operations as 
  generally it does not consider that the reduction in volatility 
  in consolidated net assets warrants the cash flow risk created 
  from such hedging techniques. 
 
 
 
22  Financial instruments 
 
    Liquidity risk 
    The liquidity risk of each entity is managed centrally by the 
     treasury function. Each operation has a facility with treasury, 
     the amount of the facility being based on budgets. The budgets 
     are set locally and agreed by the board annually in advance, enabling 
     the cash requirements to be anticipated. Where facilities of entities 
     need to be increased, approval must be sought from the finance 
     director. Where the amount of the facility is above a certain 
     level agreement of the board is needed. 
 
    All surplus cash is held centrally to maximise the returns on 
     deposits through economies of scale. The type of cash instrument 
     used and its maturity date will depend on the forecast cash requirements. 
 
    Credit risk 
    The Company is mainly exposed to credit risk from credit sales. 
     It is Company policy, implemented locally, to access the credit 
     risk of new customers before entering contracts. Such credit ratings 
     are taken into account by local business practices. 
 
    The Company does not enter into complex derivatives to manage 
     credit risk, although in certain isolated cases may take steps 
     to mitigate such risks if it is sufficiently concentrated. 
 
    Market risk 
    As the company is now investing in listed companies, the market 
     risk will be that of finding suitable investments for the company 
     to invest in and the returns that those investments will return 
     given the markets that in which investments are made. 
 
    Expected credit losses 
    Allowances are recognised as required under the IFRS 9 impairment 
     model and continue to be carried until there are indicators that 
     there is no reasonable expectation of recovery. 
 
    For trade and other receivables which do not contain a significant 
     financing component, the company applies the simplified approach. 
     This approach requires the allowance for expected credit losses 
     to be recognised at an amount equal to lifetime expected credit 
     losses. For other debt financial assets the company applies the 
     general approach to providing for expected credit losses as prescribed 
     by IFRS 9, which permits for the recognition of an allowance for 
     the estimated expected loss resulting from default in the subsequent 
     12-month period. Exposure to credit loss is monitored on a continual 
     basis and, where material, the allowance for expected credit losses 
     is adjusted to reflect the risk of default during the lifetime 
     of the financial asset should a significant change in credit risk 
     be identified. 
 
    The majority of the company's financial assets are expected to 
     have a low risk of default. A review of the historical occurrence 
     of credit losses indicates that credit losses are insignificant 
     due to the size of the company's clients and the nature of the 
     services provided. The outlook for the oil and gas industry is 
     not expected to result in a significant change in the company's 
     exposure to credit losses. As lifetime expected credit losses 
     are not expected to be significant the company has opted not to 
     adopt the practical expedient available under IFRS 9 to utilise 
     a provision matrix for the recognition of lifetime expected credit 
     losses on trade receivables. Allowances are calculated on a case-by-case 
     basis based on the credit risk applicable to individual counterparties. 
 
 
22   Financial instruments 
 
     Exposure to credit risk is continually monitored in order to identify 
      financial assets which experience a significant change in credit 
      risk. In assessing for significant changes in credit risk the 
      company makes use of operational simplifications permitted by 
      IFRS 9. The company considers a financial asset to have low credit 
      risk if the asset has a low risk of default; the counterparty 
      has a strong capacity to meet its contractual cash flow obligations 
      in the near term; and no adverse changes in economic or business 
      conditions have been identified which in the longer term may, 
      but will not necessarily, reduce the ability of the counterparty 
      to fulfil its contractual cash flow obligations. Where a financial 
      asset becomes more than 30 days past its due date additional procedures 
      are performed to determine the reasons for non-payment in order 
      to identify if a change in the exposure to credit risk has occurred. 
 
     Should a significant change in the exposure to credit risk be 
      identified the allowance for expected credit losses is increased 
      to reflect the risk of expected default in the lifetime of the 
      financial asset. The company continually monitors for indications 
      that a financial asset has become credit impaired with an allowance 
      for credit impairment recognised when the loss is incurred. Where 
      a financial asset becomes more than 90 days past its due date 
      additional procedures are performed to determine the reasons for 
      non-payment in order to identify if the asset has become credit 
      impaired. 
 
     The company considers an asset to be credit impaired once there 
      is evidence that a loss has been incurred. In addition to recognising 
      an allowance for expected credit loss, the company monitors for 
      the occurrence of events that have a detrimental impact on the 
      recoverability of financial assets. Evidence of credit impairment 
      includes, but is not limited to, indications of significant financial 
      difficulty of the counterparty, a breach of contract or failure 
      to adhere to payment terms, bankruptcy or financial reorganisation 
      of a counterparty or the disappearance of an active market for 
      the financial asset. 
 
     A financial asset is only written off when there is no reasonable 
      expectation of recovery. 
 
23   Related party transactions 
 
     The Company had the following amounts outstanding from its investee 
      companies (Note 14) at 31 December: 
 
                                                                                   2018    2017 
                                                                                 GBP000  GBP000 
 Horse Hill Development Ltd ("Horse 
  Hill")                                                                              -     749 
 Helium One                                                                         100       - 
 
 
 
     The investment in Horse Hill was disposed of in full on 28 August 
      2018 therefore there is no loan outstanding at 31 December 2018. 
 
     There were no transactions between the parent and its dormant 
      subsidiary, which are related parties, during the year. Details 
      of director's remuneration, being key personnel, are given in 
      Note 7. 
 
     The company entered into transactions with the following related 
      parties during the current year: 
 
                                                                                   2018    2017 
                                                                                 GBP000  GBP000 
 NR Global Consulting Ltd - provision of management 
  services                                                                           44       7 
 Gneiss Energy Limited - provision 
  of corporate finance advisory                                                     763       - 
 
 
 
23   Related party transactions 
 
     Remuneration of Key Management Personnel 
 
     The remuneration of the directors, and other key management 
      personnel of the Company, is set out below in aggregate for 
      each of the categories specified in IAS 24 Related party Disclosures. 
 
                                                                                    2018      2017 
                                                                                  GBP000    GBP000 
 Short-term employee benefits                                                        369       479 
 Share-based payments                                                                 27       190 
 Termination provision                                                                62        98 
 
 
 
                                                                                     458       767 
 
 
 
24    Ultimate controlling party 
 
      In the opinion of the directors there is no controlling party. 
 
25   Commitments 
 
     As at 31 December 2018, the Company had no material commitments 
      (2017:nil). 
 
26   Retirement benefit scheme 
 
     The Company operates only the basic pension plan required under 
      UK legislation, contributions thereto during the year amounted 
      to GBP1,000 (2017: GBP1,000). 
 
27    Cash generated from operations 
                                                                                    2018      2017 
                                                                                  GBP000    GBP000 
 
      Loss for the year after tax                                                (1,667)     (1,659) 
 
      Adjustments for: 
      Finance costs                                                                   41       126 
      Investment income                                                             (57)        (66) 
      Amortisation and impairment of intangible assets                               692       300 
      Impairment of investment properties                                              -       484 
      Other gains and losses                                                         529         - 
      Equity settled share based payment expense                                      27       196 
      Increase in provisions                                                         184         - 
 
      Movements in working capital: 
      Increase in trade and other receivables                                      (239)        (55) 
      Increase/(decrease) in trade and other 
       payables                                                                      224       (120) 
 
 
 
      Cash absorbed by operations                                                  (266)       (794) 
 
 
 
 
 
28  Post balance sheet event 
 
    The Company has entered into a sale and purchase agreement ("SPA") 
     to dispose of its entire 30 per cent. interest in PEDL331 on the 
     Isle of Wight ("IOW") to UK Oil and Gas plc ("UKOG") for a total 
     consideration of GBP350,000. 
     UKOG has acquired Solo's 30 per cent. interest in IOW for a total 
     consideration of GBP350,000. Effective of January 2019, the total 
     consideration has been satisfied through the issue of 17,989,326 
     new ordinary shares in UKOG ("Consideration Shares") and cash 
     of GBP90,450. The Consideration Shares are calculated based on 
     the 5-day volume weighted average price to 10 December 2018 of 
     1.4428 pence. 
 

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 rns@lseg.com or visit www.rns.com.

END

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June 28, 2019 11:55 ET (15:55 GMT)

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