17:00 Thu 24 Sep 2015
Jersey Oil & Gas PLC - Interim Results for six months ended 30 June 2015
("
Interim Results for the six months ended
Highlights
· Settlement agreement reached with the Athena partnership group (the "
· Agreement also reached with CGG Services (
· Niobe (Licence P.1889, Blocks 12/26b & 27) exploration well drilled satisfying licence obligations, however no significant hydrocarbons were encountered
· Orchid (Licence P.1556, Block 29/1c) relinquished due to the cost of maintaining the licence
· Profit (before and after tax) for the period of
Post period end:
· Acquisition of
· Placing to raise approximately
· Capital reorganisation involving, inter alia, a 1 for 100 share consolidation
· Change in Company's name to '
Outlook:
· Refined business strategy adopted seeking to build a diversified production focused
· Encouraging opportunistic outlook and currently engaged in commercial negotiations with potential vendors of suitably attractive
· Continuing to work on realising value from the Group's existing portfolio assets
"I and the rest of the JOG team joined the Company on
"As the industry adjusts to sustained lower oil prices, there is an active acquisition and divestiture market developing in the
Enquiries:
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Camarco: Tel: 020 3757 4983
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James Spinney
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Tel: 020 7409 3494 |
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Tel: 020 7448 0200
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Camarco |
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Tel: 020 3757 4983
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Ends
Notes to editors:
The Group's strategy is focused on developing, exploiting and maintaining a portfolio of
The Group's target acquisition profile includes mature oil and/or gas production assets with long tail-end production profiles and upside potential, from principally satellite fields with production-based tariff agreements, limited exposure to host platform costs, low operating costs and manageable decommissioning liabilities.
Chairman's Statement
Introduction
The first six months of 2015 were a turbulent time for both the oil and gas industry and the Company, with the fall in the Brent oil price significantly impacting operations and, in particular, cash flows from our 15 per cent. interest in the Athena oil field. As a result of this challenging environment the Company focused during the period on reducing its operating costs to a minimum in order to maintain the Group's existing assets and maximise potential future returns. In line with this objective, and following detailed negotiations, we successfully restructured our financial obligations with our two main creditors being CGG Services (
In
Review of Operations
Athena
In
Following discussions with the
Niobe
Our drilling prospect in the period was the Niobe Exploration well (Licence P.1889, Blocks 12/26b & 27b), which was drilled by Suncor Energy
Orchid
In line with our cost minimisation and value maximisation strategy announced in
Licence P.2032
As announced previously, Total E&P
Acquisition of
Having entered into the settlement agreement referred to above, thereby ring fencing and/or expunging our contractual liabilities, it was then possible for us to seek ways of potentially extracting value from the Company's significant existing tax losses, its quotation on AIM and its remaining licence interests. Post period end, in
Financial review
The Company made a profit before and after tax of
Further to entering into the above mentioned settlement agreement, there was a significant write-back to the onerous contract provision made in 2014 and going forward our liabilities to the
Share Capital Reorganisation
In order to facilitate the placing mentioned above, it was necessary to undertake a capital reorganisation pursuant to which the number of ordinary shares in issue was effectively reduced by a factor of 100. In addition, shareholder approval was obtained to amend the Articles of Association so as to increase the Company's borrowing powers, increase the Directors' authority to allot shares and disapply certain pre-emption rights. Full details of these changes were set out in the circular to shareholders published on
Outlook
Looking ahead, the Company has a strong executive management team in place, a refined business strategy to deliver growth and is fully funded through to early 2016. We continue to operate with a strict focus on capital efficiency and our priority in the second half of the year is to deliver shareholder value through pursuit of our production led strategy in the
M J Stanton
Non-Executive Chairman
Chief Executive Officer's Report
I joined the Company and Board as Chief Executive Officer on
Formerly, I was CEO and Director of Longreach Oil and Gas Ltd and previously worked at Deutsche Bank within both the Oil and Gas Corporate Finance team and the
The new team members have spent over a year evaluating non-operated
We aim to deliver strong shareholder returns through well timed production acquisitions, with their associated upside potential, and exposure to any oil price recovery. Potential acquisitions completed in the current low oil price environment should also benefit from a lower cost base with falling operating costs in the
Our acquisition targets include mature oil and/or gas production assets with long tail-end production profiles and upside potential, from principally satellite fields with production-based tariff agreements, limited exposure to host platform costs, low operating costs and manageable decommissioning liabilities. As the industry adjusts to sustained lower oil prices, there is an active acquisition and divestiture market developing in the
I would like to take this opportunity to thank shareholders for their support to date. We have great ambitions for the Company, with a production target of 10,000bopd and reserves target of 15-20 million barrels through the potential acquisition of 6 to 10 producing assets and strongly believe that we have the right team, time window and pipeline of acquisition opportunities to seek to generate significant value for all stakeholders.
Chief Executive Officer
Consolidated statement of comprehensive income
For the six months ended
|
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6 months to |
|
6 months to |
|
Year to |
|
|
|
|
|
|
|
|
|
|
|
(unaudited) |
|
(unaudited) |
|
(audited) |
|
Notes |
|
£ |
|
£ |
|
£ |
|
|
|
|
|
|
|
|
CONTINUING OPERATIONS |
|
|
|
|
|
|
|
Revenue |
|
|
4,065,794 |
|
8,589,962 |
|
13,416,062 |
|
|
|
|
|
|
|
|
Cost of sales |
|
|
(6,949,421) |
|
(9,290,041) |
|
(31,560,021) |
|
|
|
|
|
|
|
|
GROSS LOSS |
|
|
(2,883,627) |
|
(700,079) |
|
(18,143,959) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other operating expenses |
|
|
- |
|
(582,517) |
|
(1,173,133) |
Exceptional item |
6 |
|
4,184,444 |
|
(4,823,382) |
|
(21,784,400) |
Administrative expenses |
|
|
(582,373) |
|
(1,942,026) |
|
(3,082,943) |
|
|
|
|
|
|
|
|
OPERATING PROFIT/(LOSS) |
|
|
718,444 |
|
(8,048,004) |
|
(44,184,435) |
|
|
|
|
|
|
|
|
Finance costs |
|
|
(164,448) |
|
(394,474) |
|
(240,567) |
Finance income |
|
|
2,499 |
|
10,278 |
|
19,029 |
|
|
|
|
|
|
|
|
PROFIT/(LOSS) BEFORE TAX |
|
|
556,495 |
|
(8,432,200) |
|
(44,405,973) |
|
|
|
|
|
|
|
|
Tax |
7 |
|
- |
|
- |
|
- |
|
|
|
|
|
|
|
|
PROFIT/(LOSS) FOR THE PERIOD |
|
|
556,495 |
|
(8,432,200) |
|
(44,405,973) |
|
|
|
|
|
|
|
|
OTHER COMPREHENSIVE INCOME |
|
|
|
|
|
|
|
Items that will be reclassified subsequently to profit or loss |
|
|
|
|
|
|
|
Change in value of available for sale financial asset |
|
|
- |
|
787,828 |
|
- |
|
|
|
|
|
|
|
|
TOTAL COMPREHENSIVE PROFIT/(LOSS) FOR THE PERIOD |
|
|
556,495 |
|
(7,644,372) |
|
(44,405,973) |
|
|
|
|
|
|
|
|
Total comprehensive profit/(loss) attributable to: |
|
|
|
|
|
|
|
Owners of the parent |
|
|
556,495 |
|
(7,644,372) |
|
(44,405,973) |
|
|
|
|
|
|
|
|
Earnings/(Loss) per share expressed |
|
|
|
|
|
|
|
in pence per share: |
8 |
|
|
|
|
|
|
Basic |
|
|
0.24 |
|
(3.37) |
|
(19.55) |
Diluted |
|
|
0.24 |
|
(3.37) |
|
(19.55) |
The above consolidated statement of comprehensive income should be read in conjunction with the accompanying notes.
Consolidated statement of financial position
As at
|
|
|
|
|
|
|
|
|
|
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(unaudited) |
|
(unaudited) |
|
(audited) |
|
Notes |
|
£ |
|
£ |
|
£ |
NON-CURRENT ASSETS |
|
|
|
|
|
|
|
Intangible assets - Exploration costs |
9 |
|
320,958 |
|
13,047,369 |
|
1,370,799 |
Intangible assets - Data licence costs |
9 |
|
- |
|
1,083,333 |
|
833,332 |
Property, plant & equipment |
10 |
|
10,207 |
|
6,897,141 |
|
125,223 |
|
|
|
|
|
|
|
|
|
|
|
331,165 |
|
21,027,843 |
|
2,329,354 |
CURRENT ASSETS |
|
|
|
|
|
|
|
Available for sale investment |
|
|
- |
|
2,864,613 |
|
- |
Inventories |
11 |
|
- |
|
1,584,057 |
|
858,060 |
Trade and other receivables |
12 |
|
2,838,779 |
|
4,574,086 |
|
10,026,706 |
Cash and cash equivalents (including restricted cash) |
13 |
|
822,227 |
|
16,508,193 |
|
7,424,282 |
|
|
|
|
|
|
|
|
|
|
|
3,661,006 |
|
25,530,949 |
|
18,309,048 |
|
|
|
|
|
|
|
|
TOTAL ASSETS |
|
|
3,992,171 |
|
46,558,792 |
|
20,638,402 |
|
|
|
|
|
|
|
|
EQUITY |
|
|
|
|
|
|
|
SHAREHOLDERS' EQUITY |
|
|
|
|
|
|
|
Called up share capital |
|
|
2,271,693 |
|
2,271,693 |
|
2,271,693 |
Share premium account |
|
|
68,321,083 |
|
68,321,083 |
|
68,321,083 |
Share options reserve |
|
|
1,786,425 |
|
2,714,867 |
|
1,786,425 |
Accumulated losses |
|
|
(70,389,239) |
|
(35,226,986) |
|
(70,945,734) |
Reorganisation reserve |
|
|
(382,543) |
|
(382,543) |
|
(382,543) |
Available for sale investment reserve |
|
|
- |
|
195,373 |
|
- |
|
|
|
|
|
|
|
|
TOTAL EQUITY |
|
|
1,607,419 |
|
37,893,487 |
|
1,050,924 |
|
|
|
|
|
|
|
|
LIABILITIES |
|
|
|
|
|
|
|
NON-CURRENT LIABILITIES |
|
|
|
|
|
|
|
Trade and other payables > 1 year |
|
|
- |
|
1,448,297 |
|
1,218,845 |
Provisions for liabilities and charges |
15 |
|
- |
|
4,760,057 |
|
14,206,831 |
|
|
|
|
|
|
|
|
|
|
|
- |
|
6,208,354 |
|
15,425,676 |
|
|
|
|
|
|
|
|
CURRENT LIABILITIES |
|
|
|
|
|
|
|
Trade and other payables < 1 year |
12 |
|
2,384,752 |
|
2,456,951 |
|
4,161,802 |
|
|
|
|
|
|
|
|
TOTAL LIABILITIES |
|
|
2,384,752 |
|
8,665,305 |
|
19,587,478 |
|
|
|
|
|
|
|
|
TOTAL EQUITY AND LIABILITIES |
|
|
3,992,171 |
|
46,558,792 |
|
20,638,402 |
The above consolidated statement of financial position should be read in conjunction with the accompanying notes.
Consolidated statement of changes in equity
For the six months ended
|
Called up share |
|
Share premium |
|
Share options |
|
Accumulated |
|
Re- organisation |
|
Available for sale investment |
|
Total |
|
capital |
|
account |
|
reserve |
|
Losses |
|
reserve |
|
reserve |
|
equity |
|
£ |
|
£ |
|
£ |
|
£ |
|
£ |
|
£ |
|
£ |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At |
2,271,693 |
|
68,321,083 |
|
2,575,472 |
|
(27,107,644) |
|
(382,543) |
|
(279,597) |
|
45,398,464 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit for the period and total comprehensive income |
- |
|
- |
|
- |
|
(7,998,855) |
|
- |
|
354,483 |
|
(7,644,372) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lapsed options |
- |
|
- |
|
- |
|
(120,487) |
|
- |
|
120,487 |
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Transactions with owners |
- |
|
- |
|
139,395 |
|
- |
|
- |
|
- |
|
139,395 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At |
2,271,693 |
|
68,321,083 |
|
2,714,867 |
|
(35,226,986) |
|
(382,543) |
|
195,373 |
|
37,893,487 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At 1 January 2015 |
2,271,693 |
|
68,321,083 |
|
1,786,425 |
|
(70,945,734) |
|
(382,543) |
|
- |
|
1,050,924 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit for the period and total comprehensive income |
- |
|
- |
|
- |
|
556,495 |
|
- |
|
- |
|
556,495 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At 30 June 2015 |
2,271,693 |
|
68,321,083 |
|
1,786,425 |
|
(70,389,239) |
|
(382,543) |
|
- |
|
1,607,419 |
The following describes the nature and purpose of each reserve within owners' equity:
Reserve |
Description and purpose |
|
|
Called up share capital |
Represents the nominal value of shares issued |
Share premium account |
Amount subscribed for share capital in excess of nominal value |
Share options reserve |
Represents the accumulated balance of share based payment charges recognised in respect of share options granted by the Company less transfers to retained deficit in respect of options exercised or cancelled/lapsed |
Accumulated losses |
Cumulative losses recognised in the Consolidated Statement of Comprehensive Income |
Reorganisation reserve |
Amounts resulting from the restructuring of the Group |
Available for sale investment reserve |
Cumulative net gains and losses recognised as Other Comprehensive Income on available for sale investment |
The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes.
Consolidated statement of cash flows
For the six months ended 30 June 2015
|
|
|
6 months to |
|
6 months to |
|
Year to |
|
|
|
30/06/15 |
|
30/06/14 |
|
31/12/14 |
|
|
|
(unaudited) |
|
(unaudited) |
|
(audited) |
|
Notes |
|
£ |
|
£ |
|
£ |
CASH FLOWS FROM OPERATING ACTIVITIES |
|
|
|
|
|
|
|
Cash used in operations |
13 |
|
(3,687,318) |
|
(316,130) |
|
(972,043) |
Prefunding for Athena's abandonment costs |
|
|
- |
|
- |
|
(3,710,000) |
Deposit for Niobe exploration well |
|
|
- |
|
- |
|
(2,846,494) |
Net interest received |
|
|
2,499 |
|
10,278 |
|
29,896 |
Interest paid |
|
|
(3,728) |
|
- |
|
- |
|
|
|
|
|
|
|
|
Net cash used in operating activities |
|
|
(3,688,547) |
|
(305,852) |
|
(7,498,641) |
|
|
|
|
|
|
|
|
CASH FLOWS FROM INVESTING ACTIVITIES |
|
|
|
|
|
|
|
Purchase of intangible assets |
|
|
(2,799,780) |
|
(792,701) |
|
(1,648,607) |
Purchase of property, plant & equipment |
|
|
(113,728) |
|
(522,170) |
|
(3,590,239) |
Sale proceeds of assets available for sale |
|
|
- |
|
2,334,149 |
|
4,195,588 |
|
|
|
|
|
|
|
|
Net cash (used in)/generated from investing activities |
|
|
(2,913,508) |
|
1,019,278 |
|
(1,043,258) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM FINANCING ACTIVITIES |
|
|
|
|
|
|
|
CGG Services ( |
|
|
- |
|
(236,363) |
|
(472,727) |
|
|
|
- |
|
(407,778) |
|
- |
|
|
|
|
|
|
|
|
Net cash used in financing activities |
|
|
- |
|
(644,141) |
|
(472,727) |
|
|
|
|
|
|
|
|
(DECREASE)/INCREASE IN CASH AND CASH EQUIVALENTS |
|
|
(6,602,055) |
|
69,285 |
|
(9,014,626) |
|
|
|
|
|
|
|
|
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD |
13 |
|
7,074,282 |
|
16,088,908 |
|
16,088,908 |
|
|
|
|
|
|
|
|
CASH AND CASH EQUIVALENTS AT END OF PERIOD |
13 |
|
472,227 |
|
16,158,193 |
|
7,074,282 |
The above consolidated statement of cash flows should be read in conjunction with the accompanying notes.
Notes to the consolidated financial statements
For the six months ended 30 June 2015
1. GENERAL INFORMATION
The Company is a public limited company, which is quoted on AIM, a market operated by the London Stock Exchange plc and incorporated and domiciled in the
2. BASIS OF PREPARATION
These consolidated interim financial statements have been prepared under the historic cost convention, using the accounting policies that will be applied in the Group's statutory financial information for the year ended 31 December 2015 and in accordance with the Disclosure and Transparency Rules of the
The Group meets its day-to-day working capital requirements through its cash reserves. The current economic conditions and sector activities continue to create uncertainty. The Group's forecasts and projections, taking account of reasonably possible changes in trading performance, show that the Group should be able to operate with the level of its current facilities until early 2016. After making enquiries and given the recent successful fund raising, the Directors have a reasonable expectation that further funding will be achievable as required to enable the Group to continue in operational existence for the foreseeable future. The Group therefore continues to adopt the going concern basis in preparing its condensed interim financial statements.
The reports for the six months ended 30 June 2015 and 30 June 2014 are unaudited and do not constitute statutory accounts as defined by the Companies Act 2006. The financial statements for 31 December 2014 have been prepared and delivered to the Registrar of Companies. The auditors' report on those financial statements was unqualified, but did include reference to uncertainties which may cast significant doubt about the Group's ability to continue as a going concern, to which the auditors drew attention by way of an emphasis of matter without qualifying their option. Their report did not contain a statement under section 498 of the Companies Act 2006.
Under IFRS 11, the Group will continue to proportionately account for its share of assets, liabilities, revenue and expenses in its joint operations.
There are no IFRSs or IFRIC interpretations that are effective for the first time for the financial period beginning on or after 1 January 2015 that would be expected to have a material impact on the Group.
The results are not impacted by seasonality.
3. SIGNIFICANT ACCOUNTING POLICIES
The accounting policies adopted are consistent with those applied in the previous financial year.
Revenue recognition
Revenue is recognised to the extent that it is probable that economic benefits will flow to the Group and the revenue can be reliably measured. It is measured at the fair value of consideration received or receivable for sale of goods. Revenue derived from the production of hydrocarbons in which the Group has an interest with joint venture partners is recognised on the basis of the Group's working interest in those properties. It is recognised when the significant risks and rewards of ownership have been passed to the buyer.
Revenue from strategic partners on the identification of opportunities for application for a licence to explore further is recognised in the period in which the services are provided or the date a trigger event occurs if this is later.
The Group also received revenue from the production of hydrocarbons from licences held by the Group that is recognised at the end of each month based upon the quantity and price of oil and gas delivered to the customer.
Exploration and evaluation costs
The Group accounts for oil and gas and exploration and evaluation costs assets using IFRS 6 'Exploration for and Evaluation of Mineral Resources'. Such costs are initially capitalised as Intangible Assets and include payments to acquire the legal right to explore, together with the directly related costs of technical services and studies, seismic acquisition, exploratory drilling and testing.
Exploration costs are not amortised prior to the conclusion of appraisal activities.
Exploration costs included in Intangible Assets relating to exploration licences and prospects are carried forward until the existence (or otherwise) of commercial reserves has been determined subject to certain limitations including review for indications of impairment. If commercial reserves are discovered, the carrying value, after any impairment loss of the relevant assets, is then reclassified as a Tangible Asset under Production interests & fields under development. If, however, commercial reserves are not found, the capitalised costs are charged to the consolidated statement of comprehensive income. If there are indications of impairment prior to the conclusion of exploration activities, an impairment test is carried out.
Production interests & fields under development
Such assets are accumulated generally on a field by field basis and represent the cost of developing the commercial reserves discovered and bringing them into production, together with the exploration costs incurred in finding commercial reserves transferred from Intangible Assets.
The costs also include the acquisition and purchase of such assets, directly attributable overheads and the cost of recognising provisions for future restoration and decommissioning.
Amortisation, depletion and impairment of oil and gas assets
All expenditure carried within each field is amortised from the commencement of production on a unit of production basis, which is the ratio of oil and gas production in the period to the estimated quantities of commercial reserves at the end of the period plus the production in the period, on a field by field basis. Costs used in the unit of production calculation comprise the net book value of capitalised costs plus the estimated future field development costs to access the related commercial reserves. Changes in the estimates of commercial reserves or future field development costs are dealt with prospectively.
Where there has been a change in economic conditions that indicate a possible impairment in an oil and gas asset, the recoverability of the net book value relating to that field is assessed by comparison with the estimated discounted future cash flows based on management's expectations of future oil and gas prices and future costs. Any impairment identified is charged to the consolidated statement of comprehensive income as additional depletion and amortisation. Where conditions giving rise to impairment subsequently reverse, the effect of the impairment charge is also reversed as a credit to the consolidated statement of comprehensive income, net of any depreciation that would have been charged since the impairment.
Decommissioning and site restoration
Provision for decommissioning and site restoration is recognised during the initial development stage of the field when the obligation to restore the site is triggered. A corresponding amount equivalent to the provision is also recognised as part of the cost of the related production interest. The amount recognised is the estimated cost of decommissioning and site restoration, discounted to its net present value and is reassessed each year in accordance with existing conditions and requirements. Changes in the estimated timing of cost estimates are dealt with as an adjustment to the provision and a corresponding adjustment to the production interest. The unwinding of the discount on the decommissioning provision is included as a finance cost.
Inventories
Inventory of materials and product inventory supplies are stated at the lower of cost and net realisable value. Cost is determined on the first in, first out method. Inventories of hydrocarbons are stated at the lower of cost and net realisable value.
Joint operations
The Group participates in several joint operations with strategic partners, where revenue is derived from annual retainers and success fees in a combination of cash and carried interests. The Group accounts for its share of assets, liabilities, revenue and expenses of these joint operations and discloses the details in the appropriate Statement of Financial Position and Statement of Comprehensive Income headings in the proportion that relates to the Group.
Financial instruments
Financial assets and financial liabilities are recognised in the Group's Statement of Financial Position when the Group becomes party to the contractual provisions of the instrument. The Group does not have any derivative financial instruments.
Cash and cash equivalents include cash in hand and deposits held on call with banks with a maturity of three months or less.
Trade receivables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method, less provision for impairment. A provision for impairment of trade receivables is established when there is objective evidence that the Group will not be able to collect all amounts due according to the original terms of the receivables. Significant financial difficulties of the debtor, probability that the debtor will enter bankruptcy or financial reorganisation, and default or delinquency in payments (more than 30 days overdue) are considered indicators that the trade receivable is impaired. The amount of the provision is the difference between the asset's carrying amount and the present value of estimated future cash flows, discounted at the original effective interest rate. The carrying amount of the asset is reduced through the use of an allowance account, and the amount of the loss will be recognised in the Consolidated Statement of Comprehensive Income within selling and marketing costs. When a trade receivable is uncollectable, it will be written off against the allowance account for trade receivables. Subsequent recoveries of amounts previously written off are credited against selling and marketing costs in the Consolidated Statement of Comprehensive Income.
Trade payables are stated initially at fair value and subsequently measured at amortised cost.
Loan notes are stated initially at fair value and subsequently measured at amortised cost of the investment as agreed in the loan instrument.
Contingent liabilities
Contingent liabilities are possible obligations whose existence will only be confirmed by future events not wholly within the control of the Group, or present obligations where it is not probable that an outflow of resources will be required or the amount of the obligation cannot be measured with sufficient reliability.
Contingent liabilities are not recognised in the financial statements but are disclosed unless the possibility of an outflow of economic resources is considered remote.
4. SEGMENTAL REPORTING
The Directors consider that the Group operates in a single segment, that of oil and gas exploration, appraisal, development and production, in a single geographical location, the
5. FAIR VALUE OF NON-DERIVATIVE FINANCIAL ASSETS AND FINANCIAL LIABILITIES
Maturity analysis of financial assets and liabilities
Financial Assets
|
|
30/06/15 |
|
30/06/14 |
|
31/12/14 |
|
|
£ |
|
£ |
|
£ |
Up to 3 months |
|
2,838,779 |
|
3,973,256 |
|
1,816,894 |
3 to 6 months |
|
- |
|
523,749 |
|
4,134,739 |
Over 6 months |
|
- |
|
3,291,694 |
|
4,075,073 |
|
|
|
|
|
|
|
|
|
2,838,779 |
|
7,788,699 |
|
10,026,706 |
Financial Liabilities
|
|
30/06/15 |
|
30/06/14 |
|
31/12/14 |
|
|
£ |
|
£ |
|
£ |
Up to 3 months |
|
2,384,752 |
|
423,960 |
|
1,306,606 |
3 to 6 months |
|
- |
|
2,032,991 |
|
2,855,196 |
Over 6 months |
|
- |
|
1,448,297 |
|
1,218,845 |
|
|
|
|
|
|
|
|
|
2,384,752 |
|
3,905,248 |
|
5,380,647 |
Fair value estimation
Below analyses financial instruments carried at fair value, by valuation method. The different levels have been defined as follows:
· Quoted prices (unadjusted) in active markets for identical assets or liabilities (Level 1)
· Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (that is, as prices) or indirectly (that is, derived from prices) (Level 2)
· Inputs for the asset or liability that are not based on observable market data (that is, unobservable inputs) (Level 3)
6. EXCEPTIONAL ITEM
|
|
|
|
|
|
30/06/15 |
|
|
|
|
|
|
£ |
Write-back of assets, liabilities & provisions largely in relation to the Athena production asset, including intangible assets and onerous contract provisions, following the renegotiation with (a) the Athena Consortium, (b) BW Offshore and (c) CGG debt write-off |
|
|
|
|
|
4,184,444 |
|
|
|
|
|
|
|
|
|
|
|
|
|
4,184,444 |
7. TAX
Jersey Oil and Gas plc is a trading company but no liability to UK corporation tax arose on the ordinary activities for the period ended 30 June 2015 due to the availability of losses incurred. As at 31 December 2014, Trap Oil Ltd had Ring Fenced Corporation Tax losses of approximately £25.1m and Non-Ring Fenced losses of approximately £1.3m. The Company also had approximately £23.9m of losses available to offset future Supplementary Charge profit.
8. PROFIT PER SHARE
Basic profit per share is calculated by dividing the losses attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding during the period.
Diluted profit per share is calculated using the weighted average number of shares adjusted to assume the conversion of all dilutive potential ordinary shares.
|
|
Earnings attributable to ordinary shareholders |
|
Weighted average number of shares |
|
Per share amount |
|
|
£ |
|
|
|
Pence |
Period ended 30 June 2015 |
|
|
|
|
|
|
Basic EPS |
|
|
|
|
|
|
Profit attributable to ordinary shareholders |
|
556,495 |
|
227,169,331 |
|
0.24 |
Diluted EPS |
|
|
|
|
|
|
Profit attributable to ordinary shareholders |
|
556,495 |
|
235,735,490 |
|
0.24 |
9. INTANGIBLE ASSETS
|
|
Exploration |
|
Data licence |
|
|
|
|
costs |
|
costs |
|
Total |
|
|
£ |
|
£ |
|
£ |
COST |
|
|
|
|
|
|
At 1 January 2015 |
|
13,907,024 |
|
4,000,000 |
|
17,907,024 |
Additions |
|
2,799,780 |
|
- |
|
2,799,780 |
|
|
|
|
|
|
|
At 30 June 2015 |
|
16,706,804 |
|
4,000,000 |
|
20,706,804 |
|
|
|
|
|
|
|
ACCUMULATED AMORTISATION |
|
|
|
|
|
|
At 1 January 2015 |
|
12,536,225 |
|
3,166,668 |
|
15,702,893 |
Amortisation for the period |
|
- |
|
250,000 |
|
250,000 |
Impairments * |
|
3,849,621 |
|
583,332 |
|
4,432,953 |
|
|
|
|
|
|
|
At 30 June 2015 |
|
16,385,846 |
|
4,000,000 |
|
20,385,846 |
|
|
|
|
|
|
|
NET BOOK VALUE at 30 June 2015 |
|
320,958 |
|
- |
|
320,958 |
A total impairment charge of £3,849,621 (made up from the impairments below) is included in Cost of Sales in the Consolidated Statement of Comprehensive Income as an impairment trigger was identified requiring a full impairment review to be carried out in accordance with IAS 36 'Impairment of assets'. The impairments largely related to either unsuccessful exploration or a reduction in value due to potential monies due to the Athena Consortium as part of our settlement arrangements. An economic assessment of all assets was carried out as at 30 June 2015 using the Expected Monetary Value models.
* Impairments relate to the following licences included in Cost of Sales in the consolidated statement of comprehensive income:
|
|
£ |
Magnolia - Licence P.1610 |
|
17,287 |
Romeo - Licence P.1666 |
|
211,262 |
Niobe - Licence P.1889 |
|
3,368,184 |
Homer - Licence P.1989 |
|
129,596 |
Cortina - Licence P.2170 |
|
123,292 |
|
|
3,849,621 |
10. PROPERTY, PLANT & EQUIPMENT
|
|
Production interests |
|
Computer |
|
|
|
|
& fields under |
|
& office |
|
|
|
|
development |
|
equipment |
|
Total |
|
|
£ |
|
£ |
|
£ |
COST |
|
|
|
|
|
|
At 1 January 2015 |
|
29,305,027 |
|
286,022 |
|
29,591,049 |
Additions |
|
113,728 |
|
- |
|
113,728 |
|
|
|
|
|
|
|
At 30 June 2015 |
|
29,418,755 |
|
286,022 |
|
29,704,777 |
|
|
|
|
|
|
|
ACCUMULATED AMORTISATION, DEPLETION & DEPRECIATION |
|
|
|
|
||
At 1 January 2015 |
|
29,305,027 |
|
160,799 |
|
29,465,826 |
Charge for period |
|
- |
|
115,016 |
|
115,016 |
Impairment charge |
|
113,728 |
|
- |
|
113,728 |
|
|
|
|
|
|
|
At 30 June 2015 |
|
29,418,755 |
|
275,815 |
|
29,694,570 |
|
|
|
|
|
|
|
NET BOOK VALUE at 30 June 2015 |
|
- |
|
10,207 |
|
10,207 |
11. INVENTORIES
|
|
30/06/15 |
|
30/06/14 |
|
31/12/14 |
|
|
£ |
|
£ |
|
£ |
Oil inventories held for resale |
|
- |
|
1,584,057 |
|
858,060 |
12. TRADE RECEIVABLES AND TRADE PAYABLES
Within Trade and other receivables is £2.5m of joint venture assets, mainly made up of payments on account to joint venture partners. These Joint Venture assets are to be used to pay the liabilities of the Joint Ventures which as at 30 June 2015 amounted to £2.1m which is included within Trade and Other Payables within 1 year. As stated above, at the period end approximately £2.2m of the drilling costs in respect of the Niobe well were outstanding and had been accrued and accounted for under current liabilities. The expected drilling costs for Niobe had been pre-paid and, as such, a corresponding amount is accounted for under trade and other receivables representing the prepayment.
13. |
NOTES TO THE CONSOLIDATED STATEMENT OF CASH FLOWS
RECONCILIATION OF (LOSS)/PROFIT BEFORE TAX TO CASH (USED IN)/GENERATED FROM OPERATIONS |
|
|
30/06/15 |
|
30/06/14 |
|
31/12/14 |
|
|
|
(unaudited) |
|
(unaudited) |
|
(audited) |
|
|
|
£ |
|
£ |
|
£ |
|
Profit/(Loss) for the period before tax |
|
556,495 |
|
(8,432,200) |
|
(44,405,973) |
|
Adjusted for: |
|
|
|
|
|
|
|
Amortisation, impairments, depletion and depreciation |
|
4,911,697 |
|
8,172,562 |
|
33,595,239 |
|
Onerous contract provision reversed |
|
(6,492,271) |
|
- |
|
6,492,271 |
|
Site restoration provision written off |
|
(7,875,280) |
|
- |
|
- |
|
Loss on disposal of available for sale assets |
|
- |
|
- |
|
215,346 |
|
Share based payments (net) |
|
- |
|
139,395 |
|
58,433 |
|
Finance costs |
|
164,448 |
|
513,504 |
|
240,567 |
|
Finance income |
|
(2,499) |
|
(10,278) |
|
(19,029) |
|
|
|
|
|
|
|
|
|
|
|
(8,737,410) |
|
382,983 |
|
(3,823,146) |
|
|
|
|
|
|
|
|
|
Decrease/(Increase) in inventories |
|
858,060 |
|
(334,457) |
|
391,539 |
|
Decrease in trade and other receivables |
|
7,187,927 |
|
882,637 |
|
1,986,512 |
|
(Decrease)/Increase in trade and other payables |
|
(2,995,895) |
|
(1,247,293) |
|
473,052 |
|
|
|
|
|
|
|
|
|
Cash used in operations |
|
(3,687,318) |
|
(316,130) |
|
(972,043) |
CASH AND CASH EQUIVALENTS
The amounts disclosed in the consolidated statement of cash flows in respect of cash and cash equivalents are in respect of these consolidated statement of financial position amounts:
Period ended 30 June 2015 |
|
|
|
|
|
|
|
|
|
|
30/06/15 |
|
31/12/14 |
|
|
|
|
£ |
|
£ |
Unrestricted Cash and cash equivalents |
|
|
|
472,227 |
|
7,074,282 |
|
|
|
|
|
|
|
|
|
|
|
472,227 |
|
7,074,282 |
14. COMMITMENTS
Operating lease commitments - Group company as lessee
The Group leases an office at 85 Gresham Street under a non-cancellable operating lease agreement. The lease expires in February 2016. During the prior period the Group assigned its lease of 35 King Street to a third party. However, the Group is still acting as Authorised Guarantor for all liabilities of the assignee in relation to the lease agreement.
|
|
30/06/15 |
|
30/06/14 |
|
31/12/14 |
|
|
£ |
|
£ |
|
£ |
No later than 1 year |
|
54,250 |
|
- |
|
- |
Later than 1 year and no later than 5 years |
|
- |
|
631,632 |
|
82,500 |
Later than 5 years |
|
- |
|
- |
|
- |
|
|
|
|
|
|
|
|
|
54,250 |
|
631,632 |
|
82,500 |
15. PROVISIONS FOR LIABILITIES AND CHARGES
|
Onerous contracts (Athena) |
Decommissioning and site restoration |
Total |
||
|
£ |
|
£ |
|
£ |
At 1 January 2015 |
6,492,271 |
|
7,714,560 |
|
14,206,831 |
Unwinding of discount |
- |
|
160,720 |
|
160,720 |
Transfer to contingent liability |
(6,492,271) |
|
(7,875,280) |
|
(14,367,551) |
|
|
|
|
|
|
|
|
|
|
|
|
|
- |
|
- |
|
- |
|
|
|
|
|
|
16. CONTINGENT LIABILITIES
During the period, the settlement agreement reached with our partners in the Athena Consortium (referred to above), means that, although Trap Oil Ltd remains a partner in the joint venture, any past or future liabilities in respect of its interest can only be paid from the revenue that the Athena Oil Field generates and 60 per cent. of any petroleum sales or net disposal proceeds from certain other Group assets, with its consortium partners holding security over such assets. As at 30 June 2015, Trap Oil Ltd's net accumulated liability on the Athena Oil Field was approximately £4m, which represented historic unpaid payments as well as future expect abandonment provisions. Any future repayments towards this amount cannot be calculated with any certainty, and any remaining liability still in existence once the Athena Oil Field has been decommissioned will be written off.
17. RELATED PARTIES
During the period, Jersey Oil and Gas plc made loans available to wholly owned subsidiaries. The balances outstanding at the end of the period are Predator Oil Ltd £7,631 (2014: £7,559), Trap Oil Ltd £37,313,481 (2014: £35,262,806), Trap Oil & Gas Ltd £85,779 (2014: £85,707), Trap Petroleum Ltd £149,291 (2014: £149,219) and Trap Exploration (UK) Ltd £16,309 (2014: £16,238) which are included in Trade and Other Receivables, as Amounts owed by Group undertakings. During the period, the Company also made sales to Trap Oil Ltd amounting to £467,657 (2014: £1,940,481).
18. POST BALANCE SHEET EVENTS
Following the balance sheet date the Company formerly known as Trap Oil Group Plc, changed its name to Jersey Oil and Gas plc.
The share capital of the Company has also been reorganised, such that the 227,169,331 existing ordinary shares in issue were converted to 2,271,694 new ordinary shares.
On 17 August 2015, the Company placed 3,711,228 new ordinary shares at a price of 22p per share to raise £816,470 (before expenses).
On 17 August 2015, the Company also purchased Jersey Oil and Gas E&P Limited (a company incorporated in Jersey) for consideration of £495,000. The consideration was satisfied by the issue of 2,250,000 new ordinary shares.
Further to the above mentioned transactions, and the settlement of certain related fees in shares, the total number of new ordinary shares in issue as at the date of this report is 8,364,739.
19. AVAILABILITY OF THE INTERIM REPORT 2015
A copy of these results will be made available for inspection at the Company's registered office during normal business hours on any weekday. The Company's registered office is at 10 The Triangle, ng2 Business Park, Nottingham, NG2 1AE. A copy can also be downloaded from the Company's website at www.jerseyoilandgas.com. Jersey Oil and Gas plc is registered in England and Wales with registration number 7503957.
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