TIDMWBN
RNS Number : 9197S
Woburn Energy PLC
17 September 2010
+---------------------------------+---------------------------------+
| FOR IMMEDIATE RELEASE | 17 September 2010 |
+---------------------------------+---------------------------------+
Woburn Energy Plc
INTERIM RESULTS FOR THE SIX MONTHS ENDED 30 JUNE 2010
Woburn Energy Plc ("Woburn" or "the Company"; stock code: (WBN), the UK-based
exploration company, announces its interim results for the six months ended 30
June 2010.
CHAIRMAN'S STATEMENT
FOR THE SIX MONTHS ENDED 30 JUNE 2010
The financial period from January to June 2010 has been one of consolidation for
Woburn Energy Plc ("Woburn") following the refinancing of the Company in 2009.
Evaluating a number of important production and exploration opportunities in
Europe and Central Asia continues to be the focus of our activities and much
effort and funds have been expended on progressing these opportunities.
As announced in our 2009 Annual Report released in April 2010, there has been
limited progress with Woburn's assets in Colombia and the UK.
Colombia
On Las Quinchas, Woburn has completed all its obligations under the farm-in
contract signed with the operator, Kappa Resources Colombia ("Kappa"), a wholly
owned subsidiary of Pacific Rubiales Energy Corp, in April 2005 in which it
agreed to fund certain exploration drilling activities in order to earn a right
to obtain, subject to approval, a 50% interest in the Contract. In early 2008,
Woburn transferred its interests in the Las Quinchas Association Contract to Las
Quinchas Resource Corp. ("LQRC"), in which Woburn holds a 51% interest. Woburn
has, therefore, a 25.5% working interest in the Las Quinchas Association
Contract.
As reported in Woburn's 2009 Annual Report, the Joint Venture believes that the
utilisation of the Cold Heavy Oil Production with Sand (CHOPS) production
technique, pioneered in Canada, may significantly enhance productivity from the
Acacia Este field and therefore a trial of the technology has been undertaken in
2010. Initially a workover of Acacia Este 2 was completed and a hydraulic pump
installed with the intention of conducting a 4 month test to assess the
potential impact this innovative approach may have on the problems of producing
sand from the unconsolidated Mugrosa sand reservoir and increasing heavy oil
production. However the initial attempt to run the CHOPS test resulted in
Acacia Este 2 immediately sanding up and this may require a pump change before
the test can be restarted. In the meantime, the Operator has applied, against
our advice, CHOPS to Acacia Este 1. LQRC, therefore, did not participate in the
workover.
The Acacia Este 1 well has remained in long-term production testing since
November 2008. Initially production rose to 122 BOPD and then settled back to
around 24 BOPD with no increase in water (for comparison, Acacia Este 2 was on
intermittent and low production during this period). A workover was performed
on Acacia Este 1 in June, and the well showed encouraging performance with
production rising up to 60 BOPD over a 3 week period with little water.
Unfortunately the well then sanded up. The Operator has now removed the sand
and the pump has been sent for testing before the CHOPS programme can be re-run.
The next operation for the rig is an injection test on Acacia Este 4 and 5 in
order to measure the formation permeability under injection to better understand
the potential for inflow.
As reported previously, the Arce Field project has proved to be currently
uneconomic. Extended cold production testing on Arce 4 was initiated on 6
December 2008 with initial production peaking at 23 BOPD. Production settled
back to around 5-6 BOPD with 4 barrels of water per day ("BWPD"). Cold flow
testing was completed on 5 March 2010 and some of the production equipment was
moved to the Acacia Este Field to enhance their production capabilities. This
cold flow test confirmed that the oil in the reservoir is mobile and supports
the need for additional work to establish the optimal development strategy to
convert this structure into a producing reservoir. Arce has been inactive since
it was shut in after the cold production test. However, the Operator is
currently revisiting the option to thermally stimulate the field in view of
technical advances that have been made since this approach was first considered
in 2006.
In July 2010, the Operator undertook a sole risk re-entry into the Baul 3 well.
The Baul area was initially explored with the drilling of Baul 1 by Shell in
1939. Later a further 3 wells were drilled by Texas Petroleum between 1959 and
1960 under the Baul Concession. Of these the most successful was Baul 3 which
produced 16,610 barrels of oil from a shallow 14 foot Mugrosa Formation sand
before being closed in due to poor oil prices in 1960. This Mugrosa unit was
part of a 200 foot sequence of sands resting on basement that also produces at
the nearby Palagua oil field. Encouraged that oil was recognized in the
perforations to the tubing together with some wellhead pressure, the Operator
then completed a workover on Baul, ran a pump into the well and Baul is after
the first few days producing approximately 60 BOPD, with a low water cut and
high fluid level. The Operator has submitted an application to Ecopetrol for
commerciality after putting Baul on test production with retention of an area
that is in the southern section of the Las Quinchas Association Contract area
(the retained area to about 8 km north of the well). Once the identified
commercial areas have been approved by Ecopetrol and a 5 km protection area
drawn around each commercial field, this will define the retained area that
would be covered under the long term production contract with Ecopetrol. Should
Ecopetrol ask for further work on Baul (or Acacia Este for that matter), the
current licence phase could be extended by one year.
Fifty percent of the remaining acreage in the Las Quinchas Association Contract
was relinquished in 2009. Subject to approval by Ecopetrol, the Joint Venture
retained 25,000 Hectares around Acacia Este, Arce, Baul and Bukhara whilst
relinquishing the less prospective and more risky sections in the NE of the
Contract area. A further and final relinquishmentis due in the summer of 2010
at which point all areas outside of producing fields or protected areas are due
to be returned to ANH. The Joint Venture is looking to retain the area around
Acacia Este, Arce and Baul at a minimum. This retained area is a 5km protection
zone around the defined commercial areas (Arce, Acacia Este and Baul, with the
latter areas subject to approval by Ecopetrol) that are under long term
production. If Ecopetrol asks for more work on Baul, the current phase could be
extended by an additional year.
North Sea
The Company has a 15% interest in Block 49/8c, in the Southern North Sea,
operated by Wintershall Noordzee, which contains the undeveloped and currently
uneconomic Monterey gas field. Woburn has worked with its partners over the
last year to seek a buyer for its interest or to farm down its interest to
companies who will carry us through any future work obligations required to take
Monterey into development. However, there have been no firm expressions of
interest in this opportunity and, as a result, the partners have sought and have
received approval from the UK Department of Energy and Climate Change to
relinquish the licence on 1 October 2010. The relinquishment also included
abandonment of the 49/8c-4 well which was completed on 18 April 2010. Until 1
October 2010, the JV will continue to operate on a care and maintenance basis.
Portfolio Development
As reported in our annual report for 2009, Woburn continues regularly to review
the structure of and risks associated with its portfolio of assets, and it
recognises that significant modifications to the Company's portfolio will be
required in the future to increase its breadth of opportunities, create cash
flow and reduce its exposure to financial risk. Consequently, Woburn reviewed
its asset portfolio in 2009 and implemented a new strategy for growth, with the
support of its largest shareholder, including acquiring or farming-in to one or
more new assets.
Woburn is looking at new onshore, oil or gas opportunities within its current
geographic areas of activity together with those proven oil basins where it has
existing experience or influence. In particular, Europe, North Africa, the
Middle East and Central Asia are our primary target areas. Any assets acquired
would be generally non-operated but Woburn is looking in the long-run to build a
technical team in London and establish operational capabilities.
Initially we are seeking to acquire production to create immediate cash flow and
profits but we are also actively examining development and appraisal
opportunities for longer-term growth and upside for the Company. In addition if
suitable high-class distressed exploration opportunities that fit with our
planned portfolio of producing and development assets can be identified, Woburn
will consider them.
Woburn has over the last year evaluated a number of potential acquisition and
farm-in opportunities on which further detailed work is ongoing. Woburn is
actively targeting production opportunities with exploration up-side. In the
meantime, Woburn continues to actively seek new opportunities.
Arif Kemal
Qualified Person:
Dr John Cubitt (a Director of the Company) has been involved in the oil and gas
production industry for more than 30 years. Dr John Cubitt is a registered
Chartered Geologist (CGeol) and has a BSc and PhD in geology. He has compiled,
read and approved the technical disclosure as it relates to Woburn Energy Plc in
the interim financial report.
For further information, please contact:
+----------------------------------------+------------------------+
| Woburn Energy Plc | Tel: +44 (0)20 7380 |
| | 4609 |
+----------------------------------------+------------------------+
| Dr John Cubitt, Managing Director | www.woburnenergy.com |
+----------------------------------------+------------------------+
| | |
+----------------------------------------+------------------------+
| Beaumont Cornish Limited (Nominated | Tel: +44 (0)20 7628 |
| Adviser) | 3396 |
+----------------------------------------+------------------------+
| Michael Cornish | |
+----------------------------------------+------------------------+
A copy of this announcement is available from the Company's website,
www.woburnenergy.com
UNAUDITED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE SIX MONTHS ENDED 30 JUNE 2010
+-----------------------+----------+--------+-----------------+-----------------+
| | | Half-year ended | Half-year ended |
| | | 30 June 2010 | 30 June 2009 |
+----------------------------------+--------+-----------------+-----------------+
| | | (Unaudited) | (Unaudited) |
+----------------------------------+--------+-----------------+-----------------+
| | Notes | $ | $ |
+----------------------------------+--------+-----------------+-----------------+
| | | | |
+----------------------------------+--------+-----------------+-----------------+
| Revenue | | - | 47,010 |
+----------------------------------+--------+-----------------+-----------------+
| | | | |
+----------------------------------+--------+-----------------+-----------------+
| Operating expenses | | (539,198) | (314,608) |
+----------------------------------+--------+-----------------+-----------------+
| | | ____________ | ____________ |
+----------------------------------+--------+-----------------+-----------------+
| Gross loss | | (539,198) | (267,598) |
+----------------------------------+--------+-----------------+-----------------+
| | | | |
+----------------------------------+--------+-----------------+-----------------+
| Administrative expenses | | (880,647) | (946,971) |
+----------------------------------+--------+-----------------+-----------------+
| | | ____________ | ____________ |
+----------------------------------+--------+-----------------+-----------------+
| Group operating loss | | (1,419,845) | (946,971) |
+----------------------------------+--------+-----------------+-----------------+
| | | | |
+----------------------------------+--------+-----------------+-----------------+
| Reduction of provision for | 9 | 493,604 | - |
| decommissioning | | | |
+----------------------------------+--------+-----------------+-----------------+
| | | | |
+----------------------------------+--------+-----------------+-----------------+
| Bank interest receivable | | 231 | 7,716 |
+----------------------------------+--------+-----------------+-----------------+
| | | ____________ | ____________ |
+----------------------------------+--------+-----------------+-----------------+
| Loss before taxation | | (926,010) | (939,255) |
+----------------------------------+--------+-----------------+-----------------+
| | | | |
+----------------------------------+--------+-----------------+-----------------+
| Taxation | | - | - |
+----------------------------------+--------+-----------------+-----------------+
| | | ____________ | ____________ |
+----------------------------------+--------+-----------------+-----------------+
| Loss for the period from | | (926,010) | (939,255) |
| continuing operations | | | |
+----------------------------------+--------+-----------------+-----------------+
| | | | |
+----------------------------------+--------+-----------------+-----------------+
| Discontinued operations | | | |
+----------------------------------+--------+-----------------+-----------------+
| Loss for the period from | 4 | - | (1,057,838) |
| discontinued operations | | | |
+----------------------------------+--------+-----------------+-----------------+
| | | ____________ | ____________ |
+----------------------------------+--------+-----------------+-----------------+
| Loss for the period | | (926,010) | (1,997,093) |
+----------------------------------+--------+-----------------+-----------------+
| | | | |
+----------------------------------+--------+-----------------+-----------------+
| Other comprehensive income | | - | - |
+----------------------------------+--------+-----------------+-----------------+
| | | ____________ | ____________ |
+----------------------------------+--------+-----------------+-----------------+
| TOTAL COMPREHENSIVE | | (926,010) | (1,997,093) |
| INCOME FOR THE PERIOD | | | |
+-----------------------+-------------------+-----------------+-----------------+
| | | ____________ | ____________ |
+----------------------------------+--------+-----------------+-----------------+
| Total comprehensive | | | |
| income attributable | | | |
| to: | | | |
+-----------------------+-------------------+-----------------+-----------------+
| Equity owners of the Parent | | (633,050) | (1,315,325) |
| Company | | | |
+----------------------------------+--------+-----------------+-----------------+
| Minority interest | | (292,960) | (681,768) |
+----------------------------------+--------+-----------------+-----------------+
| | | ____________ | ____________ |
+----------------------------------+--------+-----------------+-----------------+
| | | (926,010) | (1,997,093) |
+----------------------------------+--------+-----------------+-----------------+
| | | ____________ | ____________ |
+----------------------------------+--------+-----------------+-----------------+
| Loss per share (cents): | 5 | | |
| Continuing operations | | | |
+----------------------------------+--------+-----------------+-----------------+
| Basic | | (0.27) | (0.45) |
+----------------------------------+--------+-----------------+-----------------+
| Diluted | | (0.27) | (0.45) |
+----------------------------------+--------+-----------------+-----------------+
| | | ___________ | ___________ |
+----------------------------------+--------+-----------------+-----------------+
| Loss per share (cents): | 5 | | |
| Discontinued and continuing | | | |
| operations | | | |
+----------------------------------+--------+-----------------+-----------------+
| Basic | | (0.27) | (0.78) |
+----------------------------------+--------+-----------------+-----------------+
| Diluted | | (0.27) | (0.78) |
+----------------------------------+--------+-----------------+-----------------+
| | | ___________ | ___________ |
+----------------------------------+--------+-----------------+-----------------+
| | | | | |
+-----------------------+----------+--------+-----------------+-----------------+
UNAUDITED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2010
+-----------------------+--------+-----------------+-----------------+
| | Notes | 30 June 2010 | 31 December |
| | | | 2009 |
+-----------------------+--------+-----------------+-----------------+
| | | (Unaudited) | (Audited) |
+-----------------------+--------+-----------------+-----------------+
| | | $ | $ |
+-----------------------+--------+-----------------+-----------------+
| ASSETS | | | |
+-----------------------+--------+-----------------+-----------------+
| | | | |
+-----------------------+--------+-----------------+-----------------+
| Non-current assets | | | |
+-----------------------+--------+-----------------+-----------------+
| Exploration and | 7 | 7,514,883 | 11,692,754 |
| evaluation assets | | | |
+-----------------------+--------+-----------------+-----------------+
| | | ____________ | ____________ |
+-----------------------+--------+-----------------+-----------------+
| Current assets | | | |
+-----------------------+--------+-----------------+-----------------+
| Receivables | | 957,891 | 913,645 |
+-----------------------+--------+-----------------+-----------------+
| Cash and cash | | 1,350,607 | 2,216,678 |
| equivalents | | | |
+-----------------------+--------+-----------------+-----------------+
| | | ____________ | ____________ |
+-----------------------+--------+-----------------+-----------------+
| | | | |
+-----------------------+--------+-----------------+-----------------+
| | | 2,308,498 | 3,130,323 |
+-----------------------+--------+-----------------+-----------------+
| | | ____________ | ____________ |
+-----------------------+--------+-----------------+-----------------+
| | | | |
+-----------------------+--------+-----------------+-----------------+
| Total Assets | | 9,823,381 | 14,823,077 |
+-----------------------+--------+-----------------+-----------------+
| | | ____________ | ____________ |
+-----------------------+--------+-----------------+-----------------+
| LIABILITIES | | | |
+-----------------------+--------+-----------------+-----------------+
| | | | |
+-----------------------+--------+-----------------+-----------------+
| Current liabilities | | | |
+-----------------------+--------+-----------------+-----------------+
| Trade and other | | (3,445,108) | (2,751,190) |
| payables | | | |
+-----------------------+--------+-----------------+-----------------+
| | | ____________ | ____________ |
+-----------------------+--------+-----------------+-----------------+
| Non-current | | | |
| liabilities | | | |
+-----------------------+--------+-----------------+-----------------+
| Borrowings | 8 | - | (4,274,000) |
+-----------------------+--------+-----------------+-----------------+
| Provision for | 9 | (185,955) | (679,559) |
| decommissioning | | | |
+-----------------------+--------+-----------------+-----------------+
| | | ____________ | ____________ |
+-----------------------+--------+-----------------+-----------------+
| | | | |
+-----------------------+--------+-----------------+-----------------+
| | | (185,955) | (4,953,559) |
+-----------------------+--------+-----------------+-----------------+
| | | ____________ | ____________ |
+-----------------------+--------+-----------------+-----------------+
| | | | |
+-----------------------+--------+-----------------+-----------------+
| Total Liabilities | | (3,631,063) | (7,704,749) |
+-----------------------+--------+-----------------+-----------------+
| | | ____________ | ____________ |
+-----------------------+--------+-----------------+-----------------+
| | | | |
+-----------------------+--------+-----------------+-----------------+
| Net Assets | | 6,192,318 | 7,118,328 |
+-----------------------+--------+-----------------+-----------------+
| | | ____________ | ____________ |
+-----------------------+--------+-----------------+-----------------+
| EQUITY | | | |
+-----------------------+--------+-----------------+-----------------+
| | | | |
+-----------------------+--------+-----------------+-----------------+
| | | | |
+-----------------------+--------+-----------------+-----------------+
| Capital and reserves | | | |
+-----------------------+--------+-----------------+-----------------+
| Share capital | 10 | 13,596,651 | 13,596,651 |
+-----------------------+--------+-----------------+-----------------+
| Share premium | | 17,815,055 | 17,815,055 |
+-----------------------+--------+-----------------+-----------------+
| Share-based payments | | 190,800 | 190,800 |
| reserve | | | |
+-----------------------+--------+-----------------+-----------------+
| Retained losses | | (28,007,539) | (27,374,489) |
+-----------------------+--------+-----------------+-----------------+
| | | ____________ | ____________ |
+-----------------------+--------+-----------------+-----------------+
| | | | |
+-----------------------+--------+-----------------+-----------------+
| Shareholders' Funds | | 3,594,967 | 4,228,017 |
+-----------------------+--------+-----------------+-----------------+
| Minority interests | | 2,597,351 | 2,890,311 |
+-----------------------+--------+-----------------+-----------------+
| | | ____________ | ____________ |
+-----------------------+--------+-----------------+-----------------+
| | | | |
+-----------------------+--------+-----------------+-----------------+
| | | 6,192,318 | 7,118,328 |
+-----------------------+--------+-----------------+-----------------+
| | | ____________ | ____________ |
+-----------------------+--------+-----------------+-----------------+
| | | | |
+-----------------------+--------+-----------------+-----------------+
UNAUDITED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE SIX MONTHS ENDED 30 JUNE 2010
+-------------------------+------------+------------+-------------+--------------+---------------+-----------+-------------+
| | Share | Share | Share-based | Retained | Total | Minority | Total |
| | Capital | Premium | Payments | Losses | Shareholders' | Interest | Equity |
| | | | Reserve | | Equity | | |
+-------------------------+------------+------------+-------------+--------------+---------------+-----------+-------------+
| | $ | $ | $ | $ | $ | $ | $ |
+-------------------------+------------+------------+-------------+--------------+---------------+-----------+-------------+
| | | | | | | | |
+-------------------------+------------+------------+-------------+--------------+---------------+-----------+-------------+
| As at 1 January 2010 | 13,596,651 | 17,815,055 | 190,800 | (27,374,489) | 4,228,017 | 2,890,311 | 7,118,328 |
+-------------------------+------------+------------+-------------+--------------+---------------+-----------+-------------+
| Total comprehensive | - | - | - | (633,050) | (633,050) | (292,960) | (926,010) |
| income/(loss) | | | | | | | |
| for the period | | | | | | | |
+-------------------------+------------+------------+-------------+--------------+---------------+-----------+-------------+
| Balance at 30 June 2010 | 13,596,651 | 17,815,055 | 190,800 | (28,007,539) | 3,594,967 | 2,597,351 | 6,192,318 |
+-------------------------+------------+------------+-------------+--------------+---------------+-----------+-------------+
| | | | | | | | |
+-------------------------+------------+------------+-------------+--------------+---------------+-----------+-------------+
| As at 1 January 2009 | 10,738,490 | 17,815,055 | 268,440 | (25,481,455) | ,3,340,530 | 2,871,650 | 6,212,180 |
+-------------------------+------------+------------+-------------+--------------+---------------+-----------+-------------+
| Share issues less costs | 2,858,161 | - | - | - | 2,858,161 | 2,871,650 | 2,858,161 |
+-------------------------+------------+------------+-------------+--------------+---------------+-----------+-------------+
| Total comprehensive | - | - | - | (1,315,325) | (1,315,325) | (681,768) | (1,997,093) |
| income/(loss) | | | | | | | |
| for the period | | | | | | | |
+-------------------------+------------+------------+-------------+--------------+---------------+-----------+-------------+
| Minority's interest in | - | - | - | - | - | 1,646,402 | 1,646,402 |
| share | | | | | | | |
| capital of subsidiary | | | | | | | |
+-------------------------+------------+------------+-------------+--------------+---------------+-----------+-------------+
| Balance at 30 June 2009 | 13,596,651 | 17,815,055 | 268,440 | (26,796,780) | 4,883,366 | 3,836,284 | 8,719,650 |
+-------------------------+------------+------------+-------------+--------------+---------------+-----------+-------------+
UNAUDITED CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE SIX MONTHS ENDED 30 JUNE 2010
+----------+-------------------------------+-------------+-------------+
| | Half-year | Half-year |
| | ended | ended |
+------------------------------------------+-------------+-------------+
| | 30 June | 30 June |
| | 2010 | 2009 |
+------------------------------------------+-------------+-------------+
| | (Unaudited) | (Unaudited) |
+------------------------------------------+-------------+-------------+
| | $ | $ |
+------------------------------------------+-------------+-------------+
| Cash flows from operating activities | | |
+------------------------------------------+-------------+-------------+
| Group operating loss from continuing | (1,419,845) | (946,971) |
| operations | | |
+------------------------------------------+-------------+-------------+
| Group operating loss from discontinued | - | (1,057,838) |
| operations | | |
+------------------------------------------+-------------+-------------+
| Adjustment for items not requiring an | | |
| outlay of funds: | | |
+------------------------------------------+-------------+-------------+
| Impairment of exploration assets (note | 4,274,000 | 1,057,838 |
| 7) | | |
+------------------------------------------+-------------+-------------+
| Write back of loan (note 8) | (4,274,000) | - |
+------------------------------------------+-------------+-------------+
| | ___________ | ___________ |
+------------------------------------------+-------------+-------------+
| | | |
+------------------------------------------+-------------+-------------+
| Operating loss before changes in working | (1,419,845) | (946,971) |
| capital | | |
+------------------------------------------+-------------+-------------+
| | Increase in receivables | (44,246) | (844,868) |
+----------+-------------------------------+-------------+-------------+
| | Increase in trade and other | 693,918 | 890,411 |
| | payables | | |
+----------+-------------------------------+-------------+-------------+
| | | ___________ | ___________ |
+----------+-------------------------------+-------------+-------------+
| | | | |
+----------+-------------------------------+-------------+-------------+
| | Net cash used in operating | (770,173) | (901,428) |
| | activities | | |
+----------+-------------------------------+-------------+-------------+
| | | ___________ | ___________ |
+----------+-------------------------------+-------------+-------------+
| | Investing activities | | |
+----------+-------------------------------+-------------+-------------+
| | Funds used for exploration | (96,129) | (204,329) |
| | and evaluation | | |
+----------+-------------------------------+-------------+-------------+
| | Interest received | 231 | 7,716 |
+----------+-------------------------------+-------------+-------------+
| | | ___________ | ___________ |
+----------+-------------------------------+-------------+-------------+
| | | | |
+----------+-------------------------------+-------------+-------------+
| | Net cash used in investing | (95,898) | (196,613) |
| | activities | | |
+----------+-------------------------------+-------------+-------------+
| | | ___________ | ___________ |
+----------+-------------------------------+-------------+-------------+
| | Financing activities | | |
+----------+-------------------------------+-------------+-------------+
| | Proceeds from issue of | - | 2,858,161 |
| | ordinary shares | | |
+----------+-------------------------------+-------------+-------------+
| | Proceeds from minorities for | - | 1,646,402 |
| | issue of ordinary shares | | |
+----------+-------------------------------+-------------+-------------+
| | | ___________ | ___________ |
+----------+-------------------------------+-------------+-------------+
| | | | |
+----------+-------------------------------+-------------+-------------+
| | Net cash from financing | - | 4,504,563 |
| | activities | | |
+----------+-------------------------------+-------------+-------------+
| | | ___________ | ___________ |
+----------+-------------------------------+-------------+-------------+
| | | | |
+----------+-------------------------------+-------------+-------------+
| | (Decrease)/increase in cash | (866,071) | 3,406,522 |
| | and cash equivalents | | |
+----------+-------------------------------+-------------+-------------+
| | Cash and cash equivalents at | 2,216,678 | (8,018) |
| | beginning of period | | |
+----------+-------------------------------+-------------+-------------+
| | | ___________ | ___________ |
+----------+-------------------------------+-------------+-------------+
| | | | |
+----------+-------------------------------+-------------+-------------+
| | Cash and cash equivalents at | 1,350,607 | 3,398,504 |
| | end of period | | |
+----------+-------------------------------+-------------+-------------+
| | | ___________ | ___________ |
+----------+-------------------------------+-------------+-------------+
NOTES TO THE UNAUDITED HALF-YEARLY FINANCIAL REPORT
FOR THE SIX MONTHS ENDED 30 JUNE 2010
1. General information
Woburn Energy Plc ('the Company') is domiciled in England. The condensed
consolidated half-year accounts of the Company for the six months ended 30 June
2010 comprise the accounts of the Company and its subsidiaries (together
referred to as 'the Group').
The condensed half-year accounts for the six months ended 30 June 2010 are
unaudited. In the opinion of the Directors, the condensed half-year accounts
for the period present fairly the financial position, and results from
operations and cash flows for the period. The condensed half-year accounts
include unaudited comparative figures for the half year ended 30 June 2009.
The financial information contained in this half-year report does not constitute
statutory accounts as defined by section 434 of the Companies Act 2006.
The comparatives for the period ended 31 December 2009 are not the Company's
full statutory accounts for that period but have been extracted from the
statutory accounts for that period which have been delivered to the Registrar of
Companies. The auditors' report on those accounts was unqualified, included
references to the going concern note in the accounts to which the auditors drew
attention by way of emphasis without qualifying their report and did not contain
a statement under section 498 (2) - (3) of the Companies Act 2006.
The half-yearly financial report was approved by the Directors on 17 September
2010 and is available on the Company's website www.woburnenergy.com.
2. Accounting policies
The condensed half-year accounts have been prepared using accounting policies
based on International Financial Reporting Standards (IFRS and IFRIC
interpretations) issued by the International Accounting Standards Board ("IASB")
as adopted for use in the European Union, including IAS 34 'Interim Financial
Reporting' and on the historical cost basis. The condensed half-year accounts
have been prepared using the accounting policies which are expected to be
applied in the Group's next statutory financial statements for the year ending
31 December 2010. The same accounting policies, presentation and methods of
computation were applied in the Group's latest audited financial statements for
the period ended 31 December 2009, except for the adoption of IAS 1
'Presentation of Financial Statements (Revised)' and IFRS 8 'Operating Segments'
in these condensed half-year accounts.
IAS 1 'Presentation of Financial Statements (Revised)' makes certain changes to
the format and titles of primary financial statements, including the requirement
to present a Statement of Changes in Equity as a primary statement and
introduces the possibility of either a single Statement of Comprehensive Income
(combining the Income Statement and a Statement of Comprehensive Income) or to
retain the Income Statement with a supplementary Statement of Comprehensive
Income. The first option has been adopted by Woburn Energy Plc. As IAS 1 is
concerned with presentation only it does not have any impact on the results or
net assets of the Group.
IFRS 8 'Operating Segments' requires operating segments to be identified on the
basis of internal reports about components of the Group that are regularly
reviewed by the Chief Operating Decision Maker ("CODM"). By contrast the
standard which it replaced, IAS 14 'Segmental Reporting', required business and
geographical segments to be identified on a risks and rewards approach. The
business segmental reporting bases used by the Company in previous years are the
same as those which are reported to the CODM, so the changes to the segmental
reporting are in respect of the additional disclosure only. The Group currently
only has one reportable segment being the exploration for oil and gas and
therefore no further disclosures have been made in these condensed half-year
accounts on the adoption of IFRS 8.
3. Going concern
The accounts have been prepared on a going concern basis. During the six month
period ended 30 June 2010 the Group made a loss of $926,010. At 30 June 2010,
the Group had net assets of $6,192,318 (31 December 2009 - $7,118,328) and net
current liabilities of $1,136,610 (31 December 2009 net current assets -
$379,133). The working capital position of the Group has, therefore,
deteriorated by $1,515,743 in the six months ended 30 June 2010.
At 30 June 2010, the Group had $1,350,607 of cash and had trade and other
payables due within one year outstanding of $3,445,108. Operating costs of
$3,634,074 are expected to be incurred for the year to 30 June 2011. As at 31
August 2010 the Group had $1,066,636 of cash with future expected net cash
outflows, including operating costs, to 31 August 2011 of $3,508,844. In view
of the current market conditions and the need to continue the exploration
activities, the Board continues to review its options, in particular the need
for future finance.
The Group is not currently earning significant revenues and therefore is not
profitable because it is still in the exploration phase of its business. The
Group is therefore reliant on the future support from its existing shareholders
or its ability to raise funds in the open market in order to be able to meet its
obligations and planned expenditures in the foreseeable future.
The Directors believe that the Group will be able to raise finance from existing
or future shareholders in the foreseeable future and that the majority
shareholder will continue to provide financial support for the foreseeable
future. The Directors therefore believe that the Group will therefore have
appropriate levels of financing and will have sufficient cash to fund its
activities and to continue its operations for the foreseeable future and for the
Group to continue to meet its liabilities as they fall due, and for at least the
next twelve months from the date of approval of these financial statements. The
financial statements have, therefore, been prepared on the going concern basis.
4. Discontinued operations
Discontinued operations shown in the statement of comprehensive income for the
six months comparative period ended 30 June 2009 consist of the disposal of
Alhucema Resource Corporation. On 1 August 2009, the Company sold its
shareholding in the entire issued share capital of Alhucema Resource Corporation
("ARC") for a consideration of $Nil. The post-tax loss of the discontinued
operations is classified as a single line on the face of the consolidated
statement of comprehensive income.
The loss from discontinued operations is as follows:
+------------------------------------------------+-------------+
| | Half-year |
| | ended |
| | 30 June |
| | 2009 |
+------------------------------------------------+-------------+
| | $ |
+------------------------------------------------+-------------+
| | |
+------------------------------------------------+-------------+
| Revenue | - |
+------------------------------------------------+-------------+
| Operating expenses - impairment of exploration | 1,057,838 |
| assets | |
+------------------------------------------------+-------------+
| Other income | - |
+------------------------------------------------+-------------+
| Finance costs | - |
+------------------------------------------------+-------------+
| | ___________ |
+------------------------------------------------+-------------+
| | |
+------------------------------------------------+-------------+
| | 1,057,838 |
+------------------------------------------------+-------------+
| | ___________ |
+------------------------------------------------+-------------+
| | |
+------------------------------------------------+-------------+
5. Loss per share
+----------------------------------------+-------------+-------------+
| | Half-year | Half-year |
| | ended 30 | ended |
| | June 2010 | 30 |
| | | June.2008 |
+----------------------------------------+-------------+-------------+
| | $ | $ |
+----------------------------------------+-------------+-------------+
| Loss attributable to equity | (633,050) | (756,132) |
| shareholders - Continuing | | |
+----------------------------------------+-------------+-------------+
| Loss attributable to equity | (633,050) | (1,315,325) |
| shareholders - Continuing and | | |
| Discontinued | | |
+----------------------------------------+-------------+-------------+
| Weighted average number of shares in | 232,160,407 | 168,472,121 |
| issue | | |
+----------------------------------------+-------------+-------------+
| | | |
+----------------------------------------+-------------+-------------+
| | Cents | Cents |
+----------------------------------------+-------------+-------------+
| Basic loss per share - Continuing | (0.27) | (0.45) |
+----------------------------------------+-------------+-------------+
| Basic loss per share - Continuing and | (0.27) | (0.78) |
| Discontinuing | | |
+----------------------------------------+-------------+-------------+
| | ___________ | ___________ |
+----------------------------------------+-------------+-------------+
The diluted loss per share has also been calculated using the same weighted
average number of shares of 232,160,407 (2009: 168,472,121) as all outstanding
share warrants are 'out of the money'.
6. Subsidiary undertakings
+-------------------------------+------------+------------------+
| Name | Ownership | Principal |
| | | activity |
+-------------------------------+------------+------------------+
| | | |
+-------------------------------+------------+------------------+
| Las Quinchas Resource | 51% | Oil and gas |
| Corporation | | exploration |
+-------------------------------+------------+------------------+
| Black Rock Oil & Gas Sucursal | 100% | Oil and gas |
| Colombia | | exploration |
+-------------------------------+------------+------------------+
The Directors have assessed the carrying values of the investments in
subsidiaries, both of which are incorporated in Colombia, and in their opinion
no impairment provision is considered necessary.
7. Exploration and evaluation assets
+--------------------------+---------+--------------+----------------+
| | | Half-year | Eighteen |
| | | ended | months ended |
+--------------------------+---------+--------------+----------------+
| | | 30 June | 31 December |
| | | 2010 | 2009 |
| | | (Unaudited) | (Audited) |
| | | $ | $ |
+--------------------------+---------+--------------+----------------+
| Cost | | | |
+--------------------------+---------+--------------+----------------+
| At beginning of period | | 16,711,430 | 16,023,143 |
+--------------------------+---------+--------------+----------------+
| Additions | | 96,129 | 4,058,314 |
+--------------------------+---------+--------------+----------------+
| Foreign exchange | | - | (996,317) |
| adjustments | | | |
+--------------------------+---------+--------------+----------------+
| Disposals | | - | (2,373,710) |
+--------------------------+---------+--------------+----------------+
| | | ____________ | ____________ |
+--------------------------+---------+--------------+----------------+
| | | | |
+--------------------------+---------+--------------+----------------+
| At end of period | | 16,807,559 | 16,711,430 |
+--------------------------+---------+--------------+----------------+
| | | ____________ | ____________ |
+--------------------------+---------+--------------+----------------+
| Impairment | | | |
+--------------------------+---------+--------------+----------------+
| At beginning of period | | (5,018,676) | (5,533,144) |
+--------------------------+---------+--------------+----------------+
| Impairment charge | | (4,274,000) | (1,859,242) |
+--------------------------+---------+--------------+----------------+
| Disposed of with | | - | 2,373,710 |
| subsidiary | | | |
+--------------------------+---------+--------------+----------------+
| | | ____________ | ____________ |
+--------------------------+---------+--------------+----------------+
| | | | |
+--------------------------+---------+--------------+----------------+
| At end of period | | (9,292,676) | (5,018,676) |
+--------------------------+---------+--------------+----------------+
| | | ____________ | ____________ |
+--------------------------+---------+--------------+----------------+
| | | | |
+--------------------------+---------+--------------+----------------+
| Net book value | | 7,514,883 | 11,692,754 |
+--------------------------+---------+--------------+----------------+
| | | ____________ | ____________ |
+--------------------------+---------+--------------+----------------+
7. Exploration and evaluation assets (continued)
The net book value of the exploration and evaluation assets can be analysed in
the following geographical areas:
+------------------------------+----------------+--------------+
| | 30 June 2010 | 31 December |
| | | 2009 |
+------------------------------+----------------+--------------+
| | $ | $ |
+------------------------------+----------------+--------------+
| | | |
+------------------------------+----------------+--------------+
| Europe | - | 4,274,000 |
+------------------------------+----------------+--------------+
| South America | 7,514,883 | 7,418,754 |
+------------------------------+----------------+--------------+
| | ___________ | ___________ |
+------------------------------+----------------+--------------+
| | | |
+------------------------------+----------------+--------------+
| | 7,514,883 | 11,692,754 |
+------------------------------+----------------+--------------+
| | ___________ | ___________ |
+------------------------------+----------------+--------------+
The amounts for intangible exploration and evaluation ("E&E") assets represent
costs incurred in relation to the Group's licences. These amounts will be
written off to the income statement as exploration expenses unless commercial
reserves are established or the determination process is not completed and there
are no indicators of impairment. The outcome of ongoing exploration and
evaluation, and therefore whether the carrying value of E&E assets will
ultimately be recovered, is inherently uncertain. During the period the
Directors decided to relinquish the North Sea Licence P1147 Block 49/8c and
therefore have now fully impaired the E&E asset by $4,274,000. There is a
corresponding write back of the non-recourse loan (note 8) which results in no
overall effect on the results for the period.
8. Borrowings - Non-recourse loan
In September 2006 the Company entered into an arrangement with Gemini Oil & Gas
Fund II, LP ("Gemini"), whereby Gemini is to fund up to US$4.274 million in
respect of the drilling of the Company's 49/8C-4 well in the Monterey Gas Field
of the Southern Gas Basin of the North Sea. The loan has been fully drawn down.
The loan is currently interest free and it is without recourse in return for an
entitlement for Gemini to receive interest and principal payments based on the
Company's share of future revenues from the Monterey Gas Field. As a result of
the relinquishment of the Licence as set out in note 7 above, the Directors
obtained agreement from Gemini on 16 August 2010 that the non-recourse loan
agreement is no longer repayable and is therefore terminated. As Gemini has no
recourse to this liability the loan has been written back to the statement of
comprehensive income.
9. Provision for decommissioning
The Directors have considered environmental issues and the need for any
necessary provision for the cost of rectifying any environmental damage, as
might be required under local legislation and the Group's licence obligations.
In their view, apart from the provision for decommissioning of $185,955 in the
consolidated statement of financial position, no further provision is necessary
at 30 June 2010 for any future costs of decommissioning or any environmental
damage. The reduction of $493,604 in the provision for decommissioning, from
$679,559 at 31 December 2009 to $185,955 at 30 June 2010, is due to a change in
estimate of the costs to carry out the decommissioning.
10. Share capital and share options
+-----------------------------+-------+---------------+---------------+
| | | 30 June | 31 December |
| | | 2010 | 2009 |
| | | (Unaudited) | (Audited) |
| | | $ | $ |
+-----------------------------+-------+---------------+---------------+
| Authorised share capital | | | |
+-----------------------------+-------+---------------+---------------+
| 1,445,235,888 ordinary | | 1,445,235,888 | 1,445,235,888 |
| shares of 1p each | | | |
+-----------------------------+-------+---------------+---------------+
| 21,031,838 deferred shares | | 21,031,838 | 21,031,838 |
| of 24p each | | | |
+-----------------------------+-------+---------------+---------------+
| | | _____________ | _____________ |
+-----------------------------+-------+---------------+---------------+
| | | | |
+-----------------------------+-------+---------------+---------------+
| | | 1,466,267,726 | 1,466,267,726 |
+-----------------------------+-------+---------------+---------------+
| | | _____________ | _____________ |
+-----------------------------+-------+---------------+---------------+
| | | | |
+-----------------------------+-------+---------------+---------------+
| | | $ | $ |
+-----------------------------+-------+---------------+---------------+
| Allotted, called up and | | | |
| fully paid share capital | | | |
+-----------------------------+-------+---------------+---------------+
| 232,160,407 ordinary shares | | 3,501,369 | 3,501,369 |
| of 1p each | | | |
+-----------------------------+-------+---------------+---------------+
| 21,031,838 deferred shares | | 10,095,282 | 10,095,282 |
| of 24p each | | | |
+-----------------------------+-------+---------------+---------------+
| | | _____________ | _____________ |
+-----------------------------+-------+---------------+---------------+
| | | | |
+-----------------------------+-------+---------------+---------------+
| | | 13,596,651 | 13,596,651 |
+-----------------------------+-------+---------------+---------------+
| | | _____________ | _____________ |
+-----------------------------+-------+---------------+---------------+
Share options and warrants
The following equity instruments have been issued by the Company and have not
been exercised at 30 June 2010:
+----------------------+---------------+----------+-------------+
| Date of grant | Number of | Exercise | Exercisable |
| | warrants | price | between |
+----------------------+---------------+----------+-------------+
| | | | |
+----------------------+---------------+----------+-------------+
| 8 August 2007 | 377,018 | 25p | 8 August |
| | | | 2007 and 8 |
| | | | August 2010 |
+----------------------+---------------+----------+-------------+
These warrants were valued at $190,800 in a prior period and were debited to the
Company's share premium account as a cost of issuing shares.
The Company's share price ranged between 2.62p and 1p during the period. The
closing share price as at 30 June 2010 was 1p per share.
11. Future exploration expenditure
The Group has no contractual future exploration expenditure commitments and
awaits the technical review of its operations in Colombia before making future
commitments.
12. Control
The Group is controlled by Cetus Investment Resources Inc which owns 86.15% of
the Company. Cetus Investment Resources Inc is a wholly-owned subsidiary of
Zaver Petroleum International Inc which is itself a wholly-owned subsidiary of
United Paramount Holding Corp. Mr Hashwani is beneficially interested in the
entire issued share capital of United Paramount Holding Corp and is therefore
the ultimate controlling party.
13. Material events subsequent to the end of the period
There have been no significant events after the balance sheet date that require
disclosure.
ENDS
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR KKODNPBKDFCD
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