TIDMBOR
RNS Number : 5771U
Borders & Southern Petroleum plc
01 April 2019
1 April 2019
Borders & Southern Petroleum plc
("Borders & Southern" or "the Company")
Audited Results for the 12 month period ended 31 December
2018
Borders & Southern (AIM: BOR), the London based independent
oil and gas exploration company with assets offshore the Falkland
Islands, announces its audited results for the year ending 31
December 2018. Full copies of the Company's Annual Report and
Accounts, including the Company Overview, Chairman's Statement,
Remuneration Committee Report, Directors' Report, Auditor's Report
and full Financial Statements, will be available on the Company's
website later today and posted to Shareholders in April.
2018 Highlights
-- Farm-out process is actively on-going.
-- Administrative expenses for 2018: $1.8 million (2017 - $1.7 million).
-- Cash balance at 31 December 2018: $5.6 million (2017 - $8.2 million); no debt.
For further information please visit www.bordersandsouthern.com
or contact:
Borders & Southern Petroleum plc
Howard Obee, Chief Executive
Tel: 020 7661 9348
Strand Hanson Limited (Nominated & Financial Adviser)
James Spinney / Ritchie Balmer / Georgia Langoulant
Tel: 020 7409 3494
Mirabaud Securities Limited (Broker)
Peter Krens
Tel: 020 7878 3362
Tavistock (Financial PR)
Simon Hudson / Barney Hayward
Tel: 020 7920 3150
The information contained within this announcement is deemed to
constitute inside information as stipulated under the Market Abuse
Regulations (EU) No. 596/2014. Upon the publication of this
announcement, this inside information is now considered to be in
the public domain.
Notes to Editors:
Borders & Southern Petroleum plc is an oil & gas
exploration company listed on the London Stock Exchange AIM (BOR).
The Company operates and has a 100% interest in three Production
Licences in the South Falkland Basin covering an area of nearly
10,000 square kilometres. The Company has acquired 2,517 square
kilometres of 3D seismic and drilled two exploration wells, making
a significant gas condensate discovery with its first well.
Competent Person Disclosure:
The technical aspects of this announcement have been reviewed,
verified and approved by Dr Howard Obee in accordance with the
Guidance Note for Mining, Oil and Gas Companies, issued by the
London Stock Exchange in respect of AIM companies. Dr Obee is a
petroleum geologist with more than 30 year's relevant experience.
He is a Fellow of the Geological Society and member of the American
Association of Petroleum Geologists and the Petroleum Exploration
Society of Great Britain.
Chief Executive's Statement
The year ending 31 December 2018 was a relatively frustrating
period for the Company. We started the year on an upbeat note,
reporting on an independent evaluation of our 100 per cent owned
Darwin gas condensate discovery that highlighted a substantial
increase in the estimation of recoverable liquids (a best estimate
gross contingent and prospective resource of over 450 million
barrels of liquids condensate and LPG). However, our main objective
of the year was to secure partners to help fund the next phase of
operations in the Falkland Islands.
We worked hard to achieve this, but unfortunately the farm-out
process is taking longer than we had hoped, for reasons largely
outside our control, such as the wider oil & gas industry's
reduced capital expenditure on offshore projects and on alternative
geographical focus areas.
To advise and assist us in the farm-out process, we have
retained a leading independent investment bank which specialises in
oil and gas asset transactions. The bank has reached out across the
industry more widely than we have previously attempted and the
response to date has been good. Data-rooms and technical sessions
have been initiated, and these continue. Feedback about the
sub-surface geology is always positive, so we are optimistic that
we can secure the partners that we need. The farm-out will continue
to be our main focus over the coming months.
The Company is in a stable financial position. The year-end cash
balance was $5.6 million, and we remain debt-free. The loss from
operations was $1.96 million. This was a slight increase from last
year and reflects adverse movements in the sterling/dollar exchange
rate. Administrative expense was $1.8 million, a small increase on
last year, due to marginally higher consultant fees during the
period.
In parallel with our commercial activities, we continue to fine
tune the technical case, both in sub-surface evaluation and our
planning for the next appraisal drilling campaign. Our current
plans include the drilling of a vertical well on Darwin West
followed by a deviated sidetrack. Key objectives for the drilling
programme will be to confirm resource estimates and reservoir
deliverability, confirm the gas-water contact and test for a
potential oil rim. Positive results from this programme would allow
us to start focusing on development using a conventional FPSO based
scheme. The intention would be to strip out the liquids from the
wet gas and re-inject the dry gas back in to the reservoir.
Reservoir modelling indicates that six production wells could
deliver peak production of over 90,000 barrels of condensate and
LPG per day.
The discovery of Darwin has provided a solid foundation for the
Company. An attractive portfolio of additional prospects will
provide growth options. However, the Board of Directors recognises
that our current prime objective must be to appraise, develop and
monetise the discovery as quickly as possible, and to achieve that,
we need to continue to focus on securing a partner and therefore
development funding. We will continue to investigate all options to
accelerate the achievement of that objective.
Howard Obee
29 March 2019
Consolidated Statement of Comprehensive Income
For the Year Ended 31 December 2018
2018 2017
Note $000 $000
------------------------------------------ ---- ------------ ------------
Administrative expenses (1,802) (1,734)
------------------------------------------ ---- ------------ ------------
Loss from operations 2 (1,802) (1,734)
------------
Finance income 29 542
------------------------------------------ ---- ------------ ------------
Finance expense (193) -
------------------------------------------ ---- ------------ ------------
Loss before tax (1,966) (1,192)
------------------------------------------ ---- ------------ ------------
Tax expense - -
------------------------------------------ ---- ------------ ------------
Loss for the year and total comprehensive
loss for the year attributable to owners
of the parent (1,966) (1,192)
------------------------------------------ ---- ------------ ------------
Basic and diluted loss per share (see
note 3) (0.41) cents (0.25) cents
------------------------------------------ ---- ------------ ------------
Consolidated Statement of Financial Position
At 31 December 2018
2018 2017
------------------------------ --------------- ---------------
$000 $000 $000 $000
------------------------------ ----- -------- ----- --------
Assets
------------------------------ ----- -------- ----- --------
Non-current assets
------------------------------ ----- -------- ----- --------
Property, plant and equipment 15 11
------------------------------ ----- -------- ----- --------
Intangible assets 291,367 290,826
------------------------------ ----- -------- ----- --------
Total non-current assets 291,382 290,837
------------------------------ ----- -------- ----- --------
Current assets
------------------------------
Other receivables 260 440
------------------------------ ----- -------- ----- --------
Cash and cash equivalents 5,626 8,251
------------------------------ ----- -------- ----- --------
Total current assets 5,886 8,691
------------------------------ ----- -------- ----- --------
Total assets 297,268 299,528
------------------------------ ----- -------- ----- --------
Liabilities
Current liabilities
------------------------------ ----- -------- ----- --------
Trade and other payables (337) (633)
------------------------------ ----- -------- ----- --------
Total net assets 296,931 298,895
------------------------------ ----- -------- ----- --------
Equity
------------------------------ -----
Share capital 8,530 8,530
------------------------------ ----- -------- ----- --------
Share premium 308,602 308,602
------------------------------ ----- -------- ----- --------
Other reserves 1,775 1,773
------------------------------ ----- -------- ----- --------
Retained deficit (21,960) (19,994)
------------------------------ ----- -------- ----- --------
Foreign currency reserve (16) (16)
------------------------------ ----- -------- ----- --------
Total equity 296,931 298,895
------------------------------ ----- -------- ----- --------
Consolidated Statement of Changes in Equity
For the Year Ended 31 December 2018
Foreign
Share Share Other Retained Currency
capital premium reserves deficit reserve Total
$000 $000 $000 $000 $000 $000
----------------------------- -------- -------- --------- -------- --------- -------
Balance at 1 January 2017 8,530 308,602 2,418 (19,465) (16) 300,069
----------------------------- -------- -------- --------- -------- --------- -------
Loss and total comprehensive
loss for the year - - - (1,192) - (1,192)
----------------------------- -------- -------- --------- -------- --------- -------
Expiry of share options - - (663) 663 - -
----------------------------- -------- -------- --------- -------- --------- -------
Recognition of share-based
payments - - 18 - - 18
----------------------------- -------- -------- --------- -------- --------- -------
Balance at 31 December 2017 8,530 308,602 1,773 (19,994) (16) 298,895
----------------------------- -------- -------- --------- -------- --------- -------
Loss and total comprehensive
loss for the year - - - (1,966) - (1,966)
Recognition of share-based
payments - - 2 - - 2
----------------------------- -------- -------- --------- -------- --------- -------
Balance at 31 December 2018 8,530 308,602 1,775 (21,960) (16) 296,931
----------------------------- -------- -------- --------- -------- --------- -------
The following describes the nature and purpose of each reserve
within owners' equity:
Reserve Description and purpose
------------------------- ---------------------------------------------
Share capital This represents the nominal value of shares
issued.
------------------------- ---------------------------------------------
Share premium Amount subscribed for share capital in excess
of nominal value.
------------------------- ---------------------------------------------
Other reserves Fair value of options issued.
------------------------- ---------------------------------------------
Retained deficit Cumulative net gains and losses recognised in
the Consolidated Statement of Comprehensive
Income.
------------------------- ---------------------------------------------
Foreign currency reserves Differences arising on change of presentation
and functional currency to US dollars.
------------------------- ---------------------------------------------
Consolidated Statement of Cash Flows
for the Year Ended 31 December 2018
2018 2017
-------------------------------------------------- -------------- --------------
$000 $000 $000 $000
-------------------------------------------------- ----- ------- ----- -------
Cash flow from operating activities
-------------------------------------------------- ----- ------- ----- -------
Loss before tax (1,966) (1,192)
-------------------------------------------------- ----- ------- ----- -------
Adjustments for:
-------------------------------------------------- ----- ------- ----- -------
Depreciation 1 1
-------------------------------------------------- ----- ------- ----- -------
Share-based payment 2 18
-------------------------------------------------- ----- ------- ----- -------
Net finance costs 164 -
-------------------------------------------------- ----- ------- ----- -------
Net finance income - (542)
-------------------------------------------------- ----- ------- ----- -------
Realised foreign exchange gains/(losses) 21 (17)
-------------------------------------------------- ----- ------- ----- -------
Cash flows used in operating activities
before changes in working capital (1,778) (1,732)
-------------------------------------------------- ----- ------- ----- -------
Decrease in other receivables 180 728
-------------------------------------------------- ----- ------- ----- -------
Increase in trade and other payables (296) (503)
-------------------------------------------------- ----- ------- ----- -------
Net cash outflow from operating activities (1,894) (1,507)
-------------------------------------------------- ----- ------- ----- -------
Cash flows used in investing activities
-------------------------------------------------- ----- ------- ----- -------
Interest received 29 11
-------------------------------------------------- ----- ------- ----- -------
Purchase of intangible assets (541) (445)
-------------------------------------------------- ----- ------- ----- -------
Purchase of tangible fixed assets (5) -
-------------------------------------------------- ----- ------- ----- -------
Net cash used in investing activities (517) (434)
-------------------------------------------------- ----- ------- ----- -------
Cash flows from financing
-------------------------------------------------- ----- ------- ----- -------
Cash flows from financing activities - -
-------------------------------------------------- ----- ------- ----- -------
Net decrease in cash and cash equivalents (2,411) (1,941)
-------------------------------------------------- ----- ------- ----- -------
Cash and cash equivalents at the beginning
of the year 8,251 9,645
-------------------------------------------------- ----- ------- ----- -------
Exchange (loss)/gain on cash and cash equivalents (214) 547
-------------------------------------------------- ----- ------- ----- -------
Cash and cash equivalents at the end of
the year 5,626 8,251
-------------------------------------------------- ----- ------- ----- -------
Notes
1. Accounting policies
Basis of preparation
The financial information for the year ended 31 December 2018
set out in this announcement does not constitute the Company's
statutory accounts. These financial statements included in the
announcement have been extracted from the Group annual financial
statements for the year ended 31 December 2018. The financial
statements have been prepared in accordance with the recognition
and measurement criteria of International Financial Reporting
Standards adopted for use in the European Union. However, this
announcement does not itself contain sufficient information to
comply with IFRS.
The auditor has issued its opinion on the Group's financial
statements for the year ended 31 December 2018 which is unmodified
and is available for inspection at the Company's registered address
and will be posted to the Group's website.
2. Going concern
The Directors are of the opinion that the Group has adequate
financial resources to enable it to undertake its planned programme
of exploration and appraisal activities for 2019.
3. Basic and dilutive loss per share
The calculation of the basic and dilutive loss per share is
based on the loss attributable to ordinary shareholders divided by
the weighted average number of shares in issue during the year. The
loss for the financial year for the group was $1.966 million (2017
- loss $1.192 million) and the weighted average number of shares in
issue for the year was 484.1 million (2017 - 484.1 million). During
the year the potential ordinary shares are anti-dilutive and
therefore diluted loss per share has not been calculated. At the
statement of financial position date, there were 7.05 million (2016
- 7.05 million) potentially dilutive ordinary shares being the
share options.
4. Subsequent Date Events
There were no subsequent date events requiring disclosure
-ends-
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END
FR UAOBRKKAOOAR
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