TIDMPET
RNS Number : 7752A
Petrel Resources PLC
04 June 2021
4(th) June 2021
Petrel Resources plc
("Petrel" or "the Company")
Preliminary Results for the Year Ended 31(st) December 2020
Petrel announces its results for the year ended 31(st) December
2020.
A copy of the Company's Annual Report and Accounts for 2020 will
be mailed shortly only to those shareholders who have elected to
receive it. Otherwise shareholders will be notified that the Annual
Report will be available on the website at www.petrelresources.com
. Copies of the Annual Report will also be available for collection
from the Company's registered office, 162 Clontarf Road, Dublin 3,
Ireland.
The Company's Annual General Meeting will be held on 27(th) July
2021 in the Hotel Riu Plaza The Gresham, 23 O'Connell Street Upper,
Dublin 1, D01 C3W7 at 10.00 am.
We are closely monitoring the Coronavirus (COVID-19) situation.
The Board takes its responsibility to safeguard the health of its
shareholders, stakeholders and employees very seriously and so
certain measures will be put in place for the AGM in response to
the COVID-19 pandemic. Details of these measures will be provided
in a letter that will be attached to the Notice of AGM.
E NDS
For further information please visit http://www.petrelresources.com/ or contact:
Enquiries:
Petrel Resources
John Teeling, Chairman +353 (0) 1 833 2833
David Horgan, Director
Nominated Adviser and Broker
Beaumont Cornish - Nominated Adviser
Roland Cornish
Felicity Geidt +44 (0) 020 7628 3396
Novum Securities Limited - Broker
Colin Rowbury +44 (0) 20 399 9400
Blytheweigh - PR +44 (0) 207 138 3206
Megan Ray +44 (0) 207 138 3553
Madeleine Gordon-Foxwell +44 (0) 207 138 3208
Teneo
Luke Hogg +353 (0) 1 661 4055
Alan Tyrrell +353 (0) 1 661 4055
Ciara Wylie +353 (0) 1 661 4055
The information contained within this announcement is deemed by
the Company to constitute inside information as stipulated under
the Market Abuse Regulations (EU) No. 596/2014 ("MAR"). The person
who arranged for the release of this announcement on behalf of the
Company was Jim Finn, Director.
Statement Accompanying the Preliminary Results
It's very difficult to write a chairman's report fifteen months
into an effective world lockdown of exploration activities.
International travel has ceased, obtaining visas is difficult as
embassies are not staffed, attempts to gain meetings with
authorities are stymied as officials work remotely. Nevertheless
work goes on and deals are worked out over zoom calls.
The stalemate continues over the ownership of 32 million Petrel
shares. These shares are subject to a high court injunction on
their sale. Despite numerous and ongoing discussions with the
original buyers of the shares no progress has been made. The
original buyers, a French based group very experienced in
resources, are either unwilling or unable to clarify ownership and
to give the undertaking necessary to lift the injunction. The
company is committed to and actively involved in attempting to find
a solution. Proposals to date lack clarity on title and funding and
do not address the ownership of 32 million shares.
Petrel has ongoing interest in Iraq and Ghana. The Irish
offshore exploration ground was dropped in the face of an offshore
oil exploration ban on all new licences and in the event of a
discovery on existing licences, the likelihood of years of
opposition to any development. Ireland is now a no-go area for
native fossil fuel development, instead relying on imported oil,
gas and electricity. Within a few years our only indigenous gas
supplier, the Corrib feed will be depleted, so we will be 100%
dependent on supplies of gas from Russia, though UK
interconnectors, and electricity from France, most likely generated
by nuclear power.
Renewables are the future but they are years if not decades away
from being able to supply consistent, stable, cost effective power
to boil a kettle, drive a car or run a manufacturing operation.
Those of us active in the natural resources sector in Ireland have
failed to persuade politicians and the media of the inherent
dangers to supply. I hope I am wrong.
Meanwhile Petrel continues to push its interest in Iraq and
Ghana. For the foreseeable future oil will play a major part in
world economic development. Iraq has some of the best oil deposits
in the world. In a stable era Iraqi oil production would be 2 or 3
times the current under 4 million barrels a day. For more than 20
years Petrel has been in Iraq. Activities have languished in year
past but the addition of an Iraqi director, Riadh Mahomud Hameed
and the contact of French investors led to a re-opening of
contacts. It has been, and remains a difficult and dangerous place
to explore. Led by Riadh we are putting exploration proposals to
the authorities. We are particularly keen to revisit the Merjan
field where we earlier produced development proposals.
Ghana, where Petrel holds a 30% interest (Clontarf 60%, local
interest 10%) in offshore block Tano 2A continues to frustrate.
Covid has played a significant role in recent delays. Meetings
expected to take place in Europe in spring 2020 were cancelled and
have not yet been reinstated. This 12 year saga shows no sign of
being finalised.
Future
While we continue to engage with the French group and respect
and admire their experience and contacts, we have to move on. Our
focus in the immediate future will be Iraq.
At the same time we will open discussions with groups in other
jurisdictions who might see Petrel as a way to monetise their oil
and gas assets.
John Teeling
Chairman
3rd June 2021
PETREL RESOURCES PLC
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE FINANCIAL YEARED 31 DECEMBER 2020
2020 2019
EUR EUR
Administrative expenses (399,133) (345,508)
Impairment of exploration and evaluation assets (51,552) (1,613,591)
OPERATING LOSS (450,685) (1,959,099)
LOSS BEFORE TAXATION (450,685) (1,959,099)
Income tax expense - -
LOSS FOR THE FINANCIAL YEAR: all attributable
to equity holders of the parent (450,685) (1,959,099)
Other comprehensive income - -
Items that are or may be reclassified
subsequently to profit or loss - -
Exchange differences - (119,048)
TOTAL COMPREHENSIVE INCOME FOR THE FINANCIAL YEAR (450,685) (2,078,147)
Loss per share - basic and diluted (0.29c) (1.50c)
PETREL RESOURCES PLC
CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER
2020
2020 2019
EUR EUR
Assets
Non-Current Assets
Intangible assets 931,967 983,969
931,967 983,969
Current Assets
Trade and other receivables 34,994 38,036
Cash and cash equivalents 333,900 367,777
368,894 405,813
Current Liabilities
Trade and other payables (710,541) (629,885)
Net Current Liabilities (341,647) (224,072)
NET ASSETS 590,320 759,897
Equity
Called-up share capital 1,962,981 1,866,827
Capital conversion reserve fund 7,694 7,694
Capital redemption reserve 209,342 209,342
Share premium 21,786,011 21,601,057
Share based payment reserve 26,871 26,871
Translation reserve - 376,154
Retained deficit (23,402,579) (23,328,048)
TOTAL EQUITY 590,320 759,897
PETREL RESOURCES PLC
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE FINANCIAL YEARED 31 DECEMBER 2020
Capital Capital Share
Redemption Conversion Based
Share Share Reserve Reserve Payment Translation Retained
Capital Premium fund Reserve Reserve Deficit Total
EUR EUR EUR EUR EUR EUR EUR EUR
At 31 December
2018 1,306,966 21,601,057 209,342 7,694 26,871 495,202 (21,368,949) 2,278,183
Shares
issued 559,861 - - - - - - 559,861
Total comprehensive
income
for the
financial
year - - - - - (119,048) (1,959,099) (2,078,147)
--------- ---------- ----------- ----------- -------- ----------- ------------ -----------
At 31 December
2019 1,866,827 21,601,057 209,342 7,694 26,871 376,154 (23,328,048) 759,897
--------- ---------- ----------- ----------- -------- ----------- ------------ -----------
Shares
issued 96,154 184,954 - - - - - 281,108
Total comprehensive
income
for the
financial
year - - - - - - (450,685) (450,685)
Transfer
of reserves (376,154) 376.154 -
--------- ---------- ----------- ----------- -------- ----------- ------------ -----------
At 31 December
2020 1,962,981 21,786,011 209,342 7,694 26,871 - (23,402,579) 590,320
========= ========== =========== =========== ======== =========== ============ ===========
Share premium
Share premium reserve comprises of a premium arising on the
issue of shares. Share issue expenses are expensed through the
statement of comprehensive income when incurred.
Capital redemption reserve
On 25 July 2018 the shareholders approved the buy back and
cancellation of 16,747,368 shares for nominal consideration from
Amira Petroleum N.V., Amira International Holdings Limited and
their advisors. These shares were immediately cancelled upon their
repurchase and the nominal value of these shares were transferred
into the capital redemption reserve.
Capital conversion reserve fund
The ordinary shares of the company were renominalised from
EUR0.0126774 each to EUR0.0125 each in 2001 and the amount by which
the issued share capital of the company was reduced was transferred
to the capital conversion reserve fund.
Share based payment reserve
The share based payment reserve arises on the grant of share
options under the share option plan.
Translation Reserve
The translation reserve arises from the translation of foreign
operations. A transfer from the translation reserve to retained
deficit occurred during the year as a result of the impairment of
the related intangible assets.
Retained deficit
Retained deficit comprises of losses incurred in the current and
prior years.
PETREL RESOURCES PLC
CONSOLIDATED CASH FLOW STATEMENT
FOR THE FINANCIAL YEARED 31 DECEMBER 2020
2020 2019
EUR EUR
CASH FLOW FROM OPERATING ACTIVITIES
Loss for the financial year (450,685) (1,959,099)
Impairment charge 51,552 1,613,591
Foreign exchange 4,623 -
OPERATING CASHFLOW BEFORE
MOVEMENTS IN WORKING CAPITAL (394,510) (345,508)
Movements in working capital:
Increase/(Decrease) in trade and other payables 80,656 (47,730)
Decrease in trade and other receivables 3,042 19,980
CASH USED IN OPERATIONS (310,812) (373,258)
NET CASH USED IN OPERATING ACTIVITIES (310,812) (373,258)
INVESTING ACTIVITIES
Receipts/(Payments) for exploration and evaluation assets 450 (150,870)
NET CASH USED IN INVESTING ACTIVITIES 450 (150,870)
FINANCING ACTIVITIES
Shares issued 281,108 559,861
NET CASH GENERATED FROM FINANCING ACTIVITIES 281,108 559,861
NET (DECREASE)/INCREASE IN CASH AND CASH EQUIVALENTS (29,254) 35,733
Cash and cash equivalents at beginning of financial year 367,777 329,503
Effect of exchange rate changes on cash held in
foreign currencies (4,623) 2,541
Cash and cash equivalents at end of financial year 333,900 367,777
NOTES:
1. ACCOUNTING POLICIES
There were no changes in accounting policies from those used to
prepare the Group's Annual Report for financial year ended 31
December 2019. The financial statements have been prepared in
accordance with International Financial Reporting Standards (IFRSs)
as adopted by the European Union.
2. LOSS PER SHARE
2020 2019
EUR EUR
Loss per share - basic and diluted (0.29c) (1.50c)
Basic loss per share
The earnings and weighted average number of ordinary shares used
in the calculation of basic loss per share are as follows:
2020 2019
EUR EUR
Loss for the financial year attributable to
equity holders (450,685) (1,959,099)
2020 2019
Number Number
Weighted average number of ordinary shares
for the
purpose of basic earnings per share 153,961,544 130,647,568
Basic and diluted loss per share are the same as the effect of
the outstanding share options is anti-dilutive.
3. GOING CONCERN
The Group incurred a loss for the financial year of EUR450,685
(2019: loss of EUR1,959,099) and had net current liabilities of
EUR341,647 (2019: EUR224,072) and a retained earnings deficit of
EUR23,402,579 (2019 deficit of EUR23,328,048) at the balance sheet
date. These conditions as well as those noted below, represent a
material uncertainty that may cast significant doubt on the Group
and Company's ability to continue as a going concern.
Included in current liabilities is an amount of EUR677,531
(2019: EUR587,531) owed to key management personnel in respect of
remuneration due at the balance sheet date. Key management have
confirmed that they will not seek settlement of these amounts in
cash for a period of at least one year after the date of approval
of the financial statements or until the Group has generated
sufficient funds from its operations after paying its third party
creditors.
The Group and Company had a cash balance of EUR333,900 (2019:
EUR367,777) at the balance sheet date. The directors have prepared
cashflow projections for a period of at least twelve months from
the date of approval of these financial statements which indicate
that additional finance may be required to fund working capital
requirements and develop existing projects. The cashflow
projections include any anticipated impacts of the Covid-19
pandemic on the Group and Company. As the Group is not revenue or
cash generating it relies on raising capital from the public
market. The Group completed capital raisings during the year.
As in previous years the Directors have given careful
consideration to the appropriateness of the going concern basis in
the preparation of the financial statements and believe the going
concern basis is appropriate for these financial statements. The
financial statements do not include the adjustments that would
result if the Group and Company were unable to continue as a going
concern.
4. INTANGIBLE ASSETS
Exploration and evaluation assets: 2020 2019
EUR EUR
Cost:
Opening balance 983,969 2,523,279
Additions - 195,870
Disposals (450) -
Exchange translation adjustment - (121,589)
Impairment (51,552) (1,613,591)
Closing balance 931,967 983,969
Segmental Analysis 2020 2019
EUR EUR
Ghana 931,967 931,967
Ireland - 52,002
Iraq - -
931,967 983,969
Exploration and evaluation assets relate to expenditure incurred
in exploration in Ireland and Ghana. The directors are aware that
by its nature there is an inherent uncertainty in Exploration and
evaluation assets and therefore inherent uncertainty in relation to
the carrying value of capitalized exploration and evaluation
assets.
Due to legislative uncertainty since 2017, exacerbated by the
Taoiseach's public statements in September 2019 against the issue
of new Atlantic oil exploration licenses, Petrel has discontinued
farm-out discussions with a gas super-major. Also, the board
reluctantly dropped our 100% owned and operated Frontier
Exploration License (FEL) 3/14, despite multiple identified
targets. Similarly, the board decided not to apply to convert our
prospective Licensing Option (LO) 16/24 into a Frontier Exploration
License. Accordingly, the directors have impaired in full all
expenditure relating to the above mentioned licenses, resulting in
an impairment charge of EUR51,552 in the current year and
EUR1,613,591 in the prior year.
During 2018 the Group resolved the outstanding issues with the
Ghana National Petroleum Company (GNPC) regarding a contract for
the development of the Tano 2A Block. The Group has signed a
Petroleum Agreement in relation to the block and this agreement
awaits ratification by the Ghanian government.
Relating to the remaining exploration and evaluation assets at
the financial year end, the directors believe there were no facts
or circumstances indicating that the carrying value of the
intangible assets may exceed their recoverable amount and thus no
impairment review was deemed necessary by the directors. The
realisation of these intangible assets is dependent on the
successful discovery and development of economic reserves and is
subject to a number of significant potential risks, as set out
below:
-- Licence obligations;
-- Funding requirements;
-- Political and legal risks, including title to licence, profit sharing and taxation;
-- Exchange note risk;
-- Political risk;
-- Financial risk management; and
-- Geological and development risks.
Directors' remuneration of EURNil (2019: EUR30,000) and salaries
of EURNil (2019: EUR15,000) were capitalised as exploration and
evaluation expenditure during the financial year.
5. SHARE CAPITAL
2020 2019
EUR EUR
Authorised:
800,000,000 ordinary shares of EUR0.0125 10,000,000 10,000,000
Allotted, called-up and fully
paid:
Number Share Share
Capital Premium
EUR EUR
At 1 January 2019 104,557,246 1,306,966 21,601,057
Issued during the financial
year 44,788,913 559,861 -
At 31 December 2019 149,346,159 1,866,827 21,601,057
At 1 January 2020 149,346,159 1,866,827 21,601,057
Issued during the financial
year 7,692,308 96,154 184,954
At 31 December 2020 157,038,467 1,962,981 21,786,011
Movements in share capital
On 30 July 2019 a total of 44,788,913 shares were placed at a
price of 1.25 cents per share. Proceeds were used to provide
additional working capital and fund development costs.
On 26 May 2020 a total of 7,692,308 shares were placed at a
price of 3.25 pence per share. Proceeds were used to provide
additional working capital and fund development costs.
6. POST BALANCE SHEET EVENTS
There were no material post balance sheet events affecting the
Company or Group.
7. ANNUAL GENERAL MEETING
The Company's Annual General Meeting will be held on 27(th) July
2021 in the Hotel Riu Plaza The Gresham, 23 O'Connell Street Upper,
Dublin 1, D01 C3W7 at 10.00 am.
8. GENERAL INFORMATION
The financial information set out above does not constitute the
Company's financial statements for the year ended 31 December 2020.
The financial information for 2019 is derived from the financial
statements for 2019 which have been delivered to the Companies
Registration Office. The auditors have reported on 2019 statements;
their report was unqualified with an emphasis of matter in respect
of considering the adequacy of the disclosures made in the
financial statements concerning the valuation of intangible assets,
investment in subsidiaries and amounts due by group undertakings.
The financial statements for 2020 will be delivered to the
Companies Registration Office.
A copy of the Company's Annual Report and Accounts for 2020 will
be mailed shortly only to those shareholders who have elected to
receive it. Otherwise shareholders will be notified that the Annual
Report will be available on the website at www.petrelresources.com
. Copies of the Annual Report will also be available for collection
from the Company's registered office, 162 Clontarf Road, Dublin 3,
Ireland.
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END
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