The information contained within this announcement is deemed to constitute inside information as stipulated under the retained EU law version of the Market Abuse Regulation (EU) No. 596/2014 (the "UK MAR") which is part of UK law by virtue of the European Union (Withdrawal) Act 2018. The information is disclosed in accordance with the Company's obligations under Article 17 of the UK MAR. Upon the publication of this announcement, this inside information is now considered to be in the public domain.

 

Caspian Sunrise PLC ("Caspian Sunrise" or the "Company")
Annual report and financial statements for the year ended 31 December 2024

 

HIGHLIGHTS

2024 Financial highlights #

·      Total revenues $52.3m of which $31.5m is from continuing operations (2023: $36.7 m of which $15.0m is from continuing operations)

·      Oil sales revenues $20.8m all of which is from discontinued operations (2023: $21.6m all of which is from discontinued operations)

·      Oil trading revenues $15.9m all of which is from continuing operations (2023: $10.3m all of which is from continuing operations)

·      Oil services revenues $15.6m all of which is from continuing operations. (2023: $4.7 million all of which is from continuing operations)

·      Operating profit/(loss) $17.4m of which $5.1m is from continuing operations (2023: $15.5m of which $(0.01) m is from continuing operations)

·      Profit/(loss) before tax $17.1m of which $5.3m is from continuing operations (2023: $14.8m of which $(0.2) m from continuing operations)

·      Profit after tax $16.8m of which $7.4m is from continuing operations (2023:  $11.1m of which $(0.9) m is from continuing operations)

·      Gross assets $135.2m (2023:  $134.9m)

#      2024 & 2023 numbers extracted from the underlying Group accounts before adjustments made under IFRS 5 Non Current Assets held for Sale and Discontinued Operations relating to the presentation of the subsequent sale in July 2025 of the MJF and South Yelemes structures at the BNG Contract Area

2024 Operational highlights

·      Production volumes 623,312 barrels (bbls) (2023: 665,114 bbls) 

·      First drilling charter completed for the Caspian Explorer under the Group's ownership

·      Renewal of the Sholkara licence on the Block 8 Contract Area

 

2025 Corporate highlights to date

·      $88 million disposal of the shallow MJF and South Yelemes structures on the BNG Contract Area

·      Acquisition of the West Shalva Contract Area

 

2025 operational highlights to date

·      Award of a 25 year production licence on the Airshagyl structure for an initial three year period

·      Acceptance by the Kazakh authorities of an initial 26 mmbls C1 reserves on the Airshagyl structure, with the scope to increase reserves in the next three years

·      Test production measured at the rate of 270 barrels of oil per day (bopd) from Deep Well P1 & 846 bopd from Deep Well  P2 on the Sholkara structure on the Block 8 Contract Area

·      3,000 meter well spudded at the West Shalva Contract Area

Expected events during the remainder of 2025

·      Yelemes Deep licence award

·      Completion of the Block 8 Contract Area acquisition and continuation of testing

·      Target depths reached at the well being drilled at the West Shalva Contract Area

·      Results of the chemical treatment at Deep Well A6 on the BNG's Airshagyl structure

·      Signing of further drilling charters for the Caspian Explorer

·      First mineral acquisitions

 

 

 

 

 

CHAIRMAN'S STATEMENT

 

Introduction

We are pleased to present the financial statements for the year ended 31 December 2024.

 

The Group's principal focus is on

 

·      oil exploration and production  

·      oil trading

·      onshore and offshore oilfield services

·      mineral exploration and production

·      other commercial projects

 

All projects to date are in Kazakhstan.

 

Overview

Much of the year under review was spent with corporate transactions, the most notable being the sale of the producing shallow structures at our flagship BNG Contract Area for a cash consideration of $88 million of which the $69.1 million due to date has been received. 

 

Although the sale completed after the year end as it was planned before the year end these financial statements are issued with the MJF and South Yelemes structures being presented under IFRS 5 Non Current Assets Held for Sale and Discontinued Operations in the consolidated statement of profit or loss as discontinued operations and in the consolidated statement of financial position as assets held for sale.

 

The decision to sell the BNG Contract Area's shallow structures made further drilling there uneconomic after the completion of Well 815. Additionally, for regulatory reasons, we were not able to drill new wells at either the assets we were seeking to buy or at the BNG Contract Area's deep structures once the full production licence upgrade applications there had been submitted.

 

Despite these distractions, declining production volumes and significant regulatory delays, we report increased revenues and profit before and after tax.

 

Since the period end we have completed the acquisition of the West Shalva Contract Area. We are also at an advanced stage in the assessment of several potential mineral acquisitions and other non-natural resources acquisitions.

 

The Group is now focused on developing its existing assets and those in the process of being acquired and under evaluation.

 

Oil exploration and production

 

BNG Contract Area

 

Shallow structures

Since production commenced from the shallow structures in 2016 in excess of 4.5 million barrels of oil have been produced.

 

Aggregate production from the BNG shallow structures in 2024 was 623,312 barrels (2023: 665,114 barrels) at a rate of 1,707 bopd (2023 1,822 bopd). The MJF and South Yelemes structures, which accounted for 100% of the Group's oil production, were sold for $88 million in July 2025 and in these financial statements in accordance with IFRS 5, the results of the disposal group have been presented as profit or loss from discontinued operations in the consolidated statement of profit or loss.

 

Deep structures

The Group has also invested more than $100 million at BNG's deep structures where we believe the geology is a continuation of that present at the nearby world class Tengiz and Kashagan assets. The deep structures are not part of the $88 million BNG asset sale.

 

The combined appraisal licence for the Airshagyl and Yelemes deep structures at the BNG Contract Area expired in 2024 and applications to upgrade to two separate 25 year production licences were then submitted to the Kazakh authorities.

 

Under the rules, no further development work is permitted from the expiry of the old licences until the new licences are issued.  In May 2025 the licence for the Airshagyl structure was  issued on a full production basis for an initial three year period. We await a decision on the licence application for the Yelemes Deep structure.

 

3A Best

Lack of available funding prevented any work at 3A Best, where the licence has expired. Given the other opportunities available the Board has decided not to seek the renewal of the 3A Best licence. As the investment at 3A Best was already fully impaired there will be no material accounting impact.

 

Oil trading

Following a change in the regulations at the start of 2023 it became possible to trade some of the oil we produce.  Despite the volume of oil produced falling during the year under review oil trading revenues grew strongly as the result of a higher proportion of sales being to the domestic market rather than the domestic mini refinery market.

 

Oilfield services

 

Onshore

The regulatory related delays at the Group's onshore existing and prospective assets meant our CTS drilling subsidiary was far less active in 2024 than in 2023 with at the year-end  two of its four principal rigs in storage.

 

As noted elsewhere in these financial statements the Group is in the process of acquiring the Block 8 Contract Area.

 

Given the extensive delays in receiving the required regulatory approvals for the acquisition of the Block 8 structure, noted in more detail later in this report, once the licence at the Sholkara structure was renewed in Q4 2024, the Group resumed testing work.

 

The costs for the work undertaken in 2024 are shown as CTS income. However, as the benefit from the work undertaken will be for the Group rather than its current owners, provided the acquisition of the Block 8 Contract Area completes as expected these costs will be paid by the Group.

 

Offshore

During the summer months of 2024 we completed the Caspian Explorer's first drilling contract under the Group's ownership for the Isatay Operating Company LLP ("IOC"), a Kazakh registered explorer, in which Italy's ENI was the leading participant, with the charter generating revenue of approximately $14.3 million and a gross profit of approximately $3.8 million.

 

The well was drilled without any notable issues and quicker than expected. However, with ENI subsequently exiting its Kazakh operations, we do not now expect to drill the additional option well under the original contract and as a result the Caspian Explorer has not been chartered in 2025.

 

While no additional charters for the Caspian Explorer have yet been confirmed we are in discussions with potential partners concerning multi-year / multi- well projects.

 

Recent financial strategy

With the potential huge upside of the BNG deep structures our focus in recent years was to ensure we completed the onerous BNG deep structures work programmes to qualify to extend the BNG deep structure licences to two separate 25 year full production licences. This was not an easy task.

 

For the past 6 years we have funded the ongoing payment of $32 million historic costs at the BNG Contract Area at the annual rate of $3.2 million.  We also had to deal with the impact of Covid during which the price for our oil fell to $6 per barrel. More recently we have been faced with the impact of Russian sanctions, which has resulted in oil sales since Q2 2022 being to the domestic market at prices closer to $30 per barrel rather than more than double that for international sales. We also had to source and pre-fund the acquisition of drilling consumables from countries other than Russia.

 

Nevertheless, we were able to fulfil the BNG deep structure work programme obligations without significant shareholder dilution. We did this by working the BNG shallow structures hard and by incurring additional debt, principally in the form of trade and other payables, which limited our ability to develop our other existing assets and to take advantage of opportunities with new assets.

 

In this light the Board considered a cash offer of $88 million for the BNG Contract Area's shallow structures, on which the older wells were showing signs of deterioration, was both attractive on a standalone basis and would significantly improve the Group's stretched financial position.

 

The sale proceeds for the BNG shallow structures have for the first time in many years allowed the Group to be properly funded, part of which is expected to be used for new projects including mineral acquisitions, which typically have shorter payback periods than for early stage oil & gas exploration and where we would have a number of routes to market which would not be affected by the impact of Russian sanctions.

 

Following completion of the announced corporate transactions underway the Group would own three oilfields, being the BNG deep structures, Block 8 and West Shalva and have an oil trading business; while also owning four on shore drilling rigs and the Caspian Explorer.

 

Corporate Transactions

 

Disposal of the MJF & South Yelemes structures on the BNG Contract Area

In September 2024 shareholders overwhelmingly approved the sale of the BNG shallow structures first announced in May 2024 for a headline cash consideration of $88 million. Accordingly, no new significant development work at the BNG Contract Area's shallow structures was undertaken after Well 815, which was spudded in the summer of 2024, as the costs of new drilling could not be recouped through additional production before the expected completion of the asset sale.

 

The full $69.1 million due to date of the purchase consideration has been received. A further $5.1 million is due to be paid in equal monthly instalments over a 12 month period commencing 6 months after the formal completion of the disposal. Additionally, a further $13.8 million is payable by the purchaser to the Kazakh authorities over the next 5 years at the rate of approximately $800,000 per quarter to fund the outstanding MJF structure's Historic Cost liability.

 

The expected profit on disposal to be recognised in the 2025 financial statements is $23 million.

 

Acquisition of the Block 8 Contract Area

In September 2023 we exercised our option to acquire the Block 8 Contract Area.

 

Under the terms of the Block 8 Acquisition Agreement there is no significant up-front cash payment or issue of shares. Virtually all the purchase consideration is to be satisfied in cash via a royalty of $5 per barrel from oil produced from the Block 8 Contract Area once owned by the Group, with the purchase price capped at $60 million.

 

We believe Block 8 represents, in addition to the deep structures at BNG, a second potentially transformative asset in that either or both may enjoy the same geological characteristics of the nearby world class Tengiz and Kashagan assets. Disappointingly, the process to secure the required regulatory approvals has extended far beyond previous timescales. 

 

The Block 8 Contract Area has three identified structures, namely the Sholkara, Akkaduk and Toresay structures. 

 

·      The licence for the Sholkara structure was renewed for a 3 year period in Q4 2024, which allowed development and testing work there to resume.

·      Regarding the Akkaduk structure the application to renew the licence has yet to be approved as delays in processing the application at one Kazakh ministry resulted in a second Kazakh ministry deeming the subsequent application to them to be out of time.  While the Kazakh courts have confirmed that they believe this is an issue between the two ministries they have yet to order the second ministry to process the licence renewal application.

·      We are no longer interested in the Toresay structure.

 

We have decided to complete the acquisition of the Block 8 Contract Area on the basis of the Sholkara licence alone while continuing to push for the renewal of the Akkaduk licence.

 

To minimise the impact of the already extensive delays we asked the existing owners to resume drilling and testing work on the Sholkara structure, which will be funded by the Group assuming the acquisition of the Block 8 Contract Area completes as expected.

 

Acquisition of West Shalva

In April 2024 independent shareholders approved the acquisition of the West Shalva Contract Area for a maximum consideration of $15 million. The acquisition was deemed be competed post year end in April 2025 (see note 31 for further details).

 

The initial $5 million consideration was satisfied in April 2025 by the issue of 99,206,349 shares issued at 4p per share.  On first oil an additional $5 million becomes payable by the issue of a further 99,206,349 shares, again to be issued at 4p per share. Additionally, the first $5 million of revenue derived from the sale of West Shalva oil once under the Group's ownership is payable in cash to the vendor, in which case the maximum consideration would be $15 million.

 

West Shalva is expected to be a far easier oilfield from which to produce oil than either BNG or Block 8.  It does not have the salt layer present at BNG and Block 8, beneath which the exceptional temperatures and pressures have made drilling difficult. Conversely, it does not have the same potential to become a world class asset.

 

It is better located for access and to deliver oil being much closer to refineries than either BNG or Block 8. It is also approximately 600 km further south than BNG and Block 8 thereby enjoying a better climate, which should result in fewer weather related delays than we encounter at BNG and are likely to encounter at Block 8.

 

More strategically, owning West Shalva made it easier to consider selling the shallow structures at  BNG while preserving oil trading revenues and without the need to have rigs idle. At the date of this report a CTS G40 rig is drilling the first West Shalva well.

 

The appraisal licence at the West Shalva Contract Area runs until 2029. West Shalva is a new Contract Area and accordingly has no existing assessed reserves, although based on internal analysis and production from adjoining fields, the Group's operational management believes that up to 80 million barrels might be recoverable¹.

 

Mineral acquisitions

We continue to pursue several mineral opportunities, the most advanced is a manganese project which is already profitable and generating cash.

 

Other projects being assessed include gold, copper, zinc and titanium. A key determinant in the assessment of all these projects is the speed at which they become cashflow positive.

 

Other projects

The Group's prime competitive advantages are its knowledge of Kazakhstan and its access to international funding.  Accordingly, on an opportunistic basis, we will look at projects in Kazakhstan other than from our core oil & gas and mineral sectors, where the board believes the Group's involvement would add significant shareholder value. However, it is not expected that the scale of such projects would exceed the Group's natural resources  activities.

 

Governance & Regulation

As a company with shares that are publicly traded and also operating complex oilfields, dealing with regulation is an everyday part of our corporate life. However, the costs of maintaining the Company's public listing and the delays in securing Kazakh regulatory consents for corporate transactions are at all-time highs.

 

In particular, the delays in securing the regulatory consents required to complete our corporate transactions coupled with the inability to develop those assets while the transactions work their way through the regulatory system come at a high price and one that ultimately falls on shareholders.

 

Realising shareholder value

Based on interest from time to time for certain of the Group's assets we believe the Group's overall asset value is significantly greater than the value implied by the Group's current market capitalisation.

 

The decline of AIM has been extensively chronicled elsewhere with many companies opting to leave the market. However, we believe we can make the market work for the benefit of shareholders. This would include at the appropriate time using targeted share buy backs and / or special dividends to provide liquidity no longer available through normal market trading.

 

Outlook

We believe we are in a much stronger position than for many years:

 

·      The sale proceeds from the MJF / South Yelemes disposal provide funding to move the Group forward. 

·      The financial pressure to complete the work programme to apply for full production licences at the BNG Contract Area's deep structures is behind us

·      The award of a full production licence for an initial three year period for the Airshagyl structure allows the continued development of a potentially transformational asset. 

·      The well tests at the Block 8 Contract Area are encouraging and once the Block 8 Contract Area acquisition completes should provide a second potentially transformative asset to develop

·      We have solid interest in further charters for the Caspian Explorer

·      The mineral projects under consideration are exciting and in a sector far less affected by international sanctions than oil & gas

 

We therefore look to the future with renewed confidence.

 

Clive Carver

Chairman

28 November 2025

 

 

Contacts:

 

Zeus James Joyce James Bavister Andre de Andrade

+44 (0) 203 829 5000

 

 

This announcement has been posted to:

www.caspiansunrise.com/investors

 

Qualified Person

Mr. Sunjin Chang, a member of the Society of Petroleum Engineers, has reviewed and approved the technical disclosures in these financial statements.

 

The person responsible for arranging the release of this announcement on behalf of the Company is Clive Carver, Chairman of the Company.

 

This announcement has been posted to:

www.caspiansunrise.com/investors

 

1Recoverable  Resources

Those quantities of hydrocarbons that are estimated to be producible by the project from either discovered or undiscovered accumulations.

 

 

 

 

 

 

 

 

OUR ASSETS

 

BNG Contract Area

The Group holds a 99% interest in the BNG Contract Area, having first taken a stake in 2008, as part of the acquisition of 58.41% of a portfolio of assets owned by Eragon Petroleum Limited. In 2017, we increased our stake to 99% upon the completion of the merger with Baverstock GmbH. Since 2008, in excess of $120 million has been spent at BNG, mostly at its deep structures.

 

The BNG Contract Area is located in the west of Kazakhstan 40 km southeast of Tengiz on the edge of the Mangistau Oblast.  We became operators at BNG in 2011, since when we have identified and developed both shallow and deep structures.

 

Shallow structures

The shallow structures at the BNG Contract Area (MJF & South Yelemes) in aggregate produced 623,312 barrels of oil in 2024 (2023: 665,114 barrels). The decline in production being principally the result of increasing water content at the older wells and after Well 815 there being no further drilling following the agreement to sell.

 

The BNG shallow structures were sold in July 2025 for an aggregate headline consideration of $88 million. To date $69.1 million of the disposal proceeds have been received with $5.1 million of the balance due in 12 equal monthly instalments commencing in Q1 2026. A further $13.8  million is due to be paid by the purchasers direct to the Kazakh Government over the next 5 years in respect of the MJF and South Yelemes structures outstanding Historic Costs liability.

 

Deep structures

We have identified two deep structures at the BNG Contract Area. The first is the Airshagyl structure, which extends to 58 km2. The second is the Yelemes Deep structure, which extends over an area of 36 km2.

 

Airshagyl structure

Four deep wells have been drilled on the Airshagyl structure.

 

·      Deep Well A5 was spudded in July 2013 and drilled to a total depth of 4,442 meters. Attempts to remove a stuck pipe have to date not proved successful and a new side track is planned in 2026

·      Deep Well A6 was spudded in 2015 and drilled to a depth of 4,528 meters. A chemical treatment at the well is underway

·      Deep Well A7 was spudded in December 2021, with a planned Total Depth of 5,300 meters but primarily targeting an interval at a depth of 4,000 meters. In March 2022 drilling at Deep Well A7 was paused at a depth of 2,150 meters to allow the rig to be used to drill a horizontal well on the shallow South Yelemes structure. Work is planned to drill the well to its planned Total Depth in 2026

·      Deep Well A8 was spudded in 2018 with a planned Total Depth of 5,300 meters, initially targeting the same pre-salt carbonates that were successfully identified in Deep Well A5. The well has been assessed as non-commercial and marked for abandonment.

 

No development work was permitted while the regulatory authorities considered the applications to upgrade appraisal licences to two separate 25 year production licences. 

 

Yelemes Deep structure

Three deep wells have been drilled on the Yelemes Deep structure.

 

·      Deep Well 801 was drilled in 2014 / 2015 to a depth of 5,050 meters. The well has been assessed as non-commercial and marked for abandonment.

·      Deep Well 802 was spudded in June 2022, with a planned Total Depth of 5,300 meters. To date the well has not flowed at commercial rates. We would wish to undertake a joint venture with a leading technical partner before continuing work on this well.

·      Deep Well 803 was spudded in December 2023 with a planned Total Depth of 4,500 meters. Oil was encountered over a 60 meter interval between depths of 3,360 and 3,420 meters. No further testing is permitted during the period that the application to upgrade the licence is under consideration, However, the oil pressure at the well has increased with oil of good quality seeping to the surface.

 

Work at the Airshagyl structure became possible once again following the award in May 2025 of the production licence, initially for a period of three years. Work at the Yelemes Deep structure remains subject to the licence renewal there.

 

 

3A Best

In January 2019, we acquired 100% of the 3A Best Group JSC, a Kazakh corporation owning an existing Contract Area of some 1,347 sq. km located near the Caspian port city of Aktau and where the licence expired some time ago. The Board has decided with the other opportunities available to the Group not to seek the renewal of the 3A Best licence.

 

Block 8

 

Background

The Block 8 Contract Area extends over 2,823 sq. km with three identified structures and is approximately 160 km from the BNG Contract Area. The Block 8 licence was previously held by LG International the Korean conglomerate.

 

At 31 December 2024 and also at the date these financial statements were approved the Block 8 Contract Area was not owned by the Group. The required consent from the Kazakh Ministry of Energy has been received with completion now dependent on the approval of the Kazakh Antimonopoly Authority.

 

Development activity

In 2023, in anticipation of the completion of the Block 8 acquisition and to avoid delays in developing the asset while the ownership was changing, the Group advanced $3.5 million by way of a secured loan to the vendors so they could satisfy the then outstanding work programme commitments and develop the oilfield for the ultimate benefit of the Group. This allowed two deep wells to be drilled to depths of 4,203 meters and 3,449 meters respectively on the Sholkara structure.

 

Following the renewal of the Sholkara structure licence in Q4 2024 development and testing work resumed on that structure which, assuming the acquisition completes as expected, will be funded by the Group.

 

At Well P1 on the Sholkara structure, oil has flowed on a test basis at rates of up to 270 bopd. At Well P2 on the Sholkara structure oil has flowed on a test basis at the rate of 846 bopd.

 

Two other wells were drilled in 2022 and 2023 to depths of 3,922 and 3,408 meters respectively on the Akkaduk structure. As noted elsewhere, testing of these wells has not been permitted during the very extended period during which the licence renewal applications are being considered by the Kazakh regulatory authorities.

 

A 63 km gravel road is under construction to improve transportation for the oil produced at the Block 8 Contract Area.

 

West Shalva

 

Background

At 31 December 2024 the West Shalva Contract Area was not owned by the Group. Shareholders approved the acquisition in April 2024 and the acquisition completed in April 2025.

 

The West Shalva Contract Area

The West Shalva Contract Area is rectangular in shape and extends over approximately 25 km².  It is located in the oil producing Zhetybay Steppe Area in the Mangyshlak region of Western Kazakhstan approximately 90 km east of Aktau and approximately 20 km north from the Zhetybay field, where an oil processing plant is located and oil enters the Aktau / Atyrau main pipeline.

 

West Shalva was first identified as a potential oil producing location in the mid 1970's. In 1977 and based on 2D seismic data, Well no. 4 (Wsh-4) was drilled to the north and outside the structural closure of the West Shalva prospect to a depth of 3,500 meters with a prime potential oil bearing interval detected at a depth of 1,033 meters in the lower Triassic. After open hole testing lasting only a few minutes the well was deemed not to have found any commercial volumes of oil or gas despite oil being detected at three other intervals. The well was then abandoned without running a production string.

 

In 2008 a 3D seismic survey was undertaken on the contract area, which identified the West Shalva structure. In June 2022 oil was detected spilling to the surface.

 

West Shalva is an early stage oilfield but with strong indicators from both the adjacent Shalva field and from the available seismic information that it is likely to produce oil in decent quantities.  Additionally, it is expected to be easier to drill than either BNG and Block 8 as the high pressure and high temperature encountered in those fields are not present at West Shalva.  There is also no salt layer to penetrate and the field is closer to local refineries with a history of higher prices than the refineries nearer BNG and Block 8.

 

In summary, West Shalva is expected to be a much easier field to work than either BNG or Block 8 and a good addition to the portfolio. As at Block 8 the acquisition has been structured to avoid any up-front cash payments.

 

CTS

 

Drilling rigs

The Group, through its wholly owned subsidiary CTS, owns four drilling rigs together with a workover rig.  The largest rig is a G50 (capable of supporting a drill string of 50 tonnes). There are two G40 rigs and a G20 rig.

 

At 31 December 2024 with no drilling at either the BNG shallow or deep structures the two G40 rigs were in storage, with one identified to drill the planned well on the West Shalva Contract Area. The G20 rig remains available for smaller workovers.

 

Caspian Explorer

 

Introduction

The Caspian Explorer is a drilling vessel designed specifically for use in the shallow northern Caspian Sea where traditional deep water rigs cannot be used.

 

The principal ways of exploring in such shallow waters are either from a land base or using a specialist shallow drilling vessel such as the Caspian Explorer, which we believe to be the only one of its type operational in the Caspian Sea.

 

Land based options typically involve either the creation of man-made islands from which to drill as if onshore or less commonly drilling out from an onshore location. Both are expensive compared to the use of a specialist drilling platform such as the Caspian Explorer.

 

Background

The Caspian Explorer was conceived of by a consortium of leading Korean companies including KNOC, Samsung and Daewoo Shipbuilding.  The vessel was assembled in the Ersay shipyard in Kazakhstan between 2010 and 2011 for a construction cost believed to be approximately $170 million. The Caspian Explorer became operational in 2012 at a time of relatively low oil prices and reduced exploration activity in the northern Caspian Sea.

 

The total costs after fit-out are believed to have been approximately $200 million. We believe a replacement would today cost in the region of $300 million and take several years from a decision to commission it for such a new vessel to become operational.

 

Operational characteristics

The Caspian Explorer:

·      operates principally between May and November in the Northern Caspian Sea, which is subject to winter ice, and all year round elsewhere

·      operates in seas with depths between 2.5 meters and 7.5 meters

·      can drill to depths of 6,000 meters

·      typically has a crew to operate the drilling vessel of 20

·      has accommodation for approximately 100

 

Mooring

The Caspian Explorer has recently moved to the port of Ersay when not on charter resulting in significant cost savings.

 

 

 

LICENCES & RESERVES

 

Licences  

 

BNG

At the time of the acquisition of the BNG Contract Area in 2008, there was a single licence issued in 2007, which was successively extended and that covered the whole Contract Area.

 

·      In 2018 a separate 25 year production licence running to 2043 was granted for the shallow MJF structure from which the bulk of the oil produced since 2016 has come. The other structures remained covered under the existing appraisal licence.

·      In 2021 another separate 25 year production licence running to 2046 was granted for the shallow South Yelemes structure, with the deep Airshagyl and Yelemes Deep structures remaining covered by the existing appraisal licence, which expired in Q3 2024. 

·      Applications for individual 25 year production licences for both the Airshagyl and Yelemes Deep structures were submitted in Q3 2024.

·      In May 2025 the production licence for the Airshagyl structure was awarded for an initial three year period.

·      We await the award of a new licence for the Yelemes Deep structure.

 

The principal advantage of a full production licence is that the majority of the oil produced may typically be sold by reference to international prices rather than on the domestic market.  However, since the introduction of sanctions on Russia, which do not cover oil produced in Kazakhstan and transported via the Russian pipeline network, all the Group's production has been sold on the domestic market.

 

Block 8

The Block 8 licence at the Sholkara structure was renewed for a three year period in Q4 2024.

 

As noted more fully elsewhere in this report the renewal of the Akkaduk structure has been the subject of disagreements between two separate Kazakh ministries.  Further applications to the Kazakh court will be made to seek the court to order the relevant ministries to renew the Akkaduk licence.

 

West Shalva

The licence at the West Shalva Contract Area is a six-year appraisal licence running until 2029.

 

3A Best

The licence renewal at 3A Best expired some time ago. Given the Group's other opportunities the board has decided not to seek the renewal of the 3A Best licence.

 

Reserves

 

BNG

 

Shallow structures

In 2011 Gaffney, Cline & Associates ("GCA") undertook a technical audit of the BNG licence area and subsequently Petroleum Geology Services ("PGS") undertook depth migration work, based on the 3D seismic work carried out in 2009 and 2010.

 

In September 2016 GCA assessed the reserves attributable to the BNG shallow structures (MJF & South Yelemes). Between then and the end of 2024, approximately 4.5 mmbls of oil were produced, which under financial reporting rules are deducted from the assessment of reserves as at 31 December 2024.

 

BNG	As at 31 December 2024	As at 31 December 2023
	mmbls	mmbls
Shallow P1	13.0	13.6
Shallow P2	24.2	24.8

 

The structures on which these reserves were calculated were sold after the year end and are no longer owned by the Group.

 

 

 

 

 

Deep structures

In conjunction with the licence extension applications in respect of the Airshagyl and Yelemes Deep structures and referred to above under licences, we were required to make submissions for formal recognition under the former Soviet classification system used in Kazakhstan of reserves at both deep structures based on information gained from the four deep wells drilled to date at the Airshagyl structure and the three deep wells drilled to date on the Yelemes Deep structure.

 

In June 2024 reserves under the former Soviet classification system were independently assessed by SciRes, a Kazakh consultancy, based solely on the vicinity of the immediate drainage area around Deep Wells A5, A6 & A7 as being C1 49.0 million barrels & C2 as 28.9 million barrels.

 

In awarding the production licence for the Airshagyl structure, initially for a three year period, the Kazakh Committee on Reserves certified C1 reserves of 26 mmbls with the opportunity over the next three years for increases dependent on further drilling.

 

Block 8

An estimate of the reserves at Block 8 is planned following further testing.

 

West Shalva

To date there are no certified reserves in respect of the West Shalva Contract Area. Again, we intend to commission an independent assessment of the West Shalva reserves after completing the current 3,000 meter well.

 

3A Best

There were no certified reserves in respect of the 3A Best Contract Area.

 

 

 

FINANCIAL REVIEW

 

Basis of inclusion

Under IFRS 5 the shallow MJF and South Yelemes structures at the BNG Contract Area are treated as assets held for sale at 31 December 2024 despite the sale not being concluded until July 2025.  Accordingly, in the consolidated profit or loss statement there are no entries for the revenues, or the costs relating to those assets for either the year ended 31 December 2024 or 31 December 2023 and instead the results are presented as profit for the year from discontinued operations in the statement of comprehensive income.

 

To allow a meaningful analysis of trading through the year the following segmental and other financial information set out below has been extracted from the underlying financial records and reconciled to the financial information set out in the consolidated profit or loss account, statement of financial position and cashflows.

 

Overview

 

Years ended 31 December	2024	2024	2024	2023	2023	2023
	Discontinued	Continuing	Total	Discontinued	Continuing	Total
	$'million	$'million	$'million	$'million	$'million	$'million
Revenue
Oil production	20.8	-	20.8	21.6	-	21.6
Oil trading	-	15.9	15.9	-	10.3	10.3
Onshore  oilfield services	-	1.3	1.3	-	4.1	4.1
Offshore oilfield services	-	14.3	14.3	-	0.7	0.7
Total	20.8	31.5	52.3	21.6	15.1	36.7
Gross profit
Oil production	14.4		14.4	16.5		16.5
Oil trading	-	6.2	6.2	-	4.9	4.9
Onshore oilfield services	-	(0.8)	(0.8)	-	(0.9)	(0.9)
Offshore oilfield services	-	3.8	3.8	-	0.2	0.2
Total	14.4	9.2	23.6	16.5	4.2	20.7

 

Revenue

Total revenue in 2024 increased by approximately 43% to $52.3 million (2023: $36.7 million). Of this revenue $20.8 million relates to discontinued activities (2023: $21.6 million).

 

39.8% of total revenue was derived from oil sales (2023: 58.9%); 30.4% from oil trading (2023: 28.1%), 2.5% from on shore oil services ( 2023:11.2%) and 27.3% from offshore oil services (2023: 1.9%).

 

Gross profit

Gross profit increased by approximately 14 % to approximately $23.6 million (2023: $20.7 million) of which $14.4 million relates to discontinued activities (2023: $16.5 million. This is principally as a result of the contribution from the Caspian Explorer's first commercial drilling charter under the Group's ownership and additional oil trading activity.

 

Oil production

With the 2025 sale of the MJF and South Yelemes structures oil production is classified as a discontinued activity in these financial statements, notwithstanding the Group's ongoing interest and very significant investment in three other active oilfields.

 

Oil production revenue

Oil production revenue in 2024 was 3.8% lower at $20.8 million (2023: $21.6 million). Oil production gross profit was 13% lower at $14.4 million (2023: $16.5 million). All oil production revenue in 2023 and 2024 related to discontinued operations.

 

Oil prices

All production in the year under review was sold on the domestic market as was the case in the preceding year. In 2024 the average price received per barrel was approximately $33.4 compared to $32.5 in 2023.

 

Production volumes

Production in 2024 at 623,312 barrels was approximately 6% lower than in 2023 (665,114 barrels).

 

Oil trading

Oil trading is classified in these financial statements as a continuing activity.

 

Under this heading we purchase crude oil and fund its refining, selling the resultant oil products to third parties.  To date we have adopted a relatively low risk approach to oil trading having formed a 70:30 partnership with an established trader with ourselves being the larger party and with our 30% partner providing the required funding.

 

Revenue from oil trading in 2024 was $15.9 million (2023: $10.3 million). Gross profit from oil trading was $6.2 million (2023: $4.9 million). The increase in oil trading revenue and gross profit in the period under review reflects the increased  proportion of oil sold to the domestic market compared to the domestic mini refinery market.

 

Onshore oilfield services

Onshore oilfield services are classified in these financial statements as a continuing activity.

 

Onshore oilfield services are conducted through our wholly owned CTS subsidiary, which owns and operates four drilling rigs. Onshore oilfield services revenue in 2024 was $1.3 million (2023: $4.1 million). Onshore oilfield services gross loss in 2024 was $0.8 million (2023: a gross loss of $0.9 million).

 

CTS's work at Block 8 following the renewal of the Sholkara structure's licence in Q4 2024, which accounts for 100% of the CTS income for the year, under IFRS rules is treated as third party income. However, provided the Block 8 acquisition completes as expected then any benefits from this drilling work will ultimately be obtained by the Group and the costs will be paid by the Group.

 

Offshore oilfield services

Offshore oilfield services is classified in these financial statements as a continuing activity.

 

Offshore oilfield oil services are conducted through the Caspian Explorer, a drilling platform specifically designed to explore the shallow northern Caspian Sea.

 

Offshore oilfield services revenue, delivered by the Caspian Explorer's charter for a consortium led by Italy's ENI, was $14.3 million (2023: $0.6 million). Gross profit in 2024 was $3.8 million (2023: $0.2 million).

 

Selling expenses

Selling expenses fell by approximately 27% to $2.2 million (2023: $3.0 million) mainly as the result of a higher proportion of sales in the year being to the mainstream domestic market rather than to the domestic mini refinery market. Of these amounts $0.2 million related to continuing operations (2023: $1.9 million) and $2.1 million related to discontinued operations (2023: $1.0 million).

 

Administrative costs

Administrative costs fell by approximately 35% from $6.0 million in 2023 to $3.9 million in 2024.  Continuing administrative costs were approximately $1.6 million lower at $2.4 million compared with $4.0 million in 2023. Discontinued administrative costs also fell from $2.1 million in 2023 to $1.5 million in 2024.

 

Other income

Other income in 2024 was nil ( 2023: $3.8 million, which related to the write back of long standing but no longer required provisions).

 

Operating profit

2024 operating profit was $17.5 million, of which operating profit from continuing operations was $5.1 million (2023: $15.5 million, of which the operating profit from continuing operations was nil).

 

Profit for the year before tax

Profit before tax was $17.1 million (2023: $14.8 million) of which $5.3 million was for continuing activities (2023: a loss of $0.2 million) and $11.8 million related to discontinued operations (2023: $15.0 million).

 

Tax

Total tax fell from $3.7 million in 2023 to $0.2 million in 2024. The tax credit on continuing activities in 2024 was $2.1 million (2023: $0.7 million charge) with a tax charge in 2024 on discontinued operations of $2.4 million (2023: 3.0 million).

 

 

Profit for the year after tax

Profit for the year after tax was $16.8 million (2023: $11.1 million) of which $7.4 million related to continuing operations (2023: loss of $0.9 million) and $9.4 million related to discontinued operations (2023: $12.0 million).

 

Oil and gas assets

 

Unproven oil & gas assets

The carrying value of unproven oil and gas assets fell by approximately $2.9 million to approximately $49.1 million (2023: $52.0 million) principally as the result of foreign exchange differences despite a further $6.4 million additions during 2024.

 

Proven oil & gas assets

Proven oil & gas assets at 31 December 2024 were $ nil million (2023: $60.6 million), following the transfer of all proven oil & gas assets to assets held for sale.

 

Oilfield services assets

These are the Caspian Explorer, the drilling rigs owned by the Group and other equipment and motor vehicles and increased in value from $4.4 million in 2023 to $4.5 million in 2024 through a combination of depreciation, foreign exchange differences and some transfers to assets held for sale. Of this the Caspian Explorer's carrying value remained at $1.7 million. (2023: $1.7 million).

 

Trade and other receivables

Trade and other receivables due within 12 months fell to approximately $8.2 million (2023: $12.1 million). Of this trade receivables were $3.8 million (2023: $3.7 million); prepayments were $2.2 million (2023: $4.3 million); recoverable VAT fell by $2.0 million to $0.9 million (2023: $2.9 million); with other receivables remaining at $1.3 million (2023: $1.3 million).

 

Cash position

At the year-end we had cash at bank balances of approximately $2.6 million (2023: $0.4 million). At the date of these financial statements the Group held approximately $23 million in cash.

 

Tax liabilities and receivable

At the year-end, the Group had a corporation income tax receivable of $1.8 million (2023: $1.0 million liability) due to mandatory tax payments on account being higher than the expected tax charge.

 

Current liabilities

 

Trade and other payables under 12 months (excluding historic costs and provisions)

Trade and other payables increased by $4.7 million to $20.8 million (2023: $16.1 million). The increase reflected the Group's financial constraints in the run up to completion of the sale of the MJF and South Yelemes structures.

 

Third party borrowings

Borrowings at 31 December 2024 was $5.5 million (2023: $6.7 million).

 

Provisions

The provisions for payments due in less than 12 months were approximately $3.7 million (2023: $4.5 million), which are mainly social obligations.

 

Liabilities relating to assets held for sale

Liabilities relating to assets held for sale at 31 December 2024 were $15.2 million (2023: $ nil) comprising $13.8 million MJF and South Yelemes structures historic cost and approximately $1.4 million associated asset retirement obligations.

 

Liabilities due after 12 months

These decreased by $19 million to $21.2 million at 31 December 2024 (2023: $40.2 million. Of the decrease $13.7 million related to the MJF and South Yelemes structures historic costs liabilities transferred to liabilities relating to assets held for sale noted above

 

Additionally, within the overall $21.2 million due, deferred tax liabilities fell to $6.4 million (2023: $7.4 million) and other long term payables fell from $14.9 million to $12.3 million.

 

 

 

 

BNG historic costs

We have continued to pay down the historic costs assessed against the BNG Contract Area. At 31 December 2024, of the original $32 million levied in 2019 approximately $13.9 million remained to be paid over the next five years, of which approximately $3.2 million was to be paid within 12 months.

 

Following completion of the sale of the MJF and South Yelemes structures the purchaser is responsible for the repayment of these historic costs.

 

Cashflows

During the period under review approximately $54.8 million was received from customers and approximately $37.3 million paid out to suppliers, creditors and staff with a further $6.4 million spent on unproven oil and gas assets and $9.4 million spent on property plant and equipment. A further $0.7 million was paid to related parties in connection with the Block 8 loan..

 

The above less the total repayments of loans and interest of $0.5 million resulted in cash balances at the year-end increasing from $1.2 million to $2.6 million.

 

Going Concern

The financial strategy of the Group in recent years has been to fund compliance with work programme commitments in particular at the BNG Contract Area's deep structures and where possible to expand the Group's activities without unduly diluting shareholders longer term interests. This inevitably stretched the short and medium term creditor position to levels at the period end and subsequently which in a more established Group might appear excessive.

 

Completion of the sale of the MJF and South Yelemes structures, with at the date of this report the receipt of $69.1 million of the disposal proceeds, has allowed the repayment of a significant portion of the year end debt and a material reduction in the amounts due to trade and other creditors.   Additionally the $13.8 million outstanding historic costs relating to the MJF and South Yelemes structures are now the  responsibility of the purchaser of the MJF and South Yelemes structures.

 

At the date of these financial statements the Group has cash of approximately $23 million, which is significantly in excess of the Group's financial commitments over the next 12 months

 

Accordingly, the Board for the first time in many years, no longer considers there to be a material uncertainty regarding the assessment of the Group's financial position and have adopted the going concern basis in preparing these financial statements.

 

In assessing the Group's adoption of the going concern basis in the preparation of these financial statements the Board has assessed cash flow forecasts prepared for the period to 31 December 2026 and assessed the risks and uncertainties associated with the operations and funding position, including Block 8 and West Shalva.

 

Clive Carver

Chairman

28 November 2025

 

 

QUALIFIED PERSON & GLOSSARY

 

Qualified Person

Mr. Sunjin Chang, a member of the Society of Petroleum Engineers, has reviewed and approved the technical disclosures in these financial statements.

 

Glossary

SPE - the Society of Petroleum Engineers

Bbl - barrels of oil

Bopd - barrels of oil per day

mmbls - million barrels

 

Proven reserves

Proven reserves (P1) are those quantities of petroleum which, by analysis of geosciences and engineering data, can be estimated with reasonable certainty to be commercially recoverable, from a given date forward, from known reservoirs and under defined economic conditions, operating methods, and government regulations.

 

If deterministic methods are used, the term reasonable certainty is intended to express a high degree of confidence that the quantities will be recovered. If probabilistic methods are used, there should be at least a 90% probability that the quantities actually recovered will equal or exceed the estimate.

 

Probable reserves

Probable reserves are those additional reserves which analysis of geosciences and engineering data indicate are less likely to be recovered than proved reserves but more certain to be recovered than possible reserves. It is equally likely that actual remaining quantities recovered will be greater than or less than the sum of the estimated proved plus probable reserves (2P).  In this context, when probabilistic methods are used, there should be at least a 50% probability that the actual quantities recovered will equal or exceed the 2P estimate.

 

Possible reserves

Possible reserves are those additional reserves which analysis of geosciences and engineering data indicate are less likely to be recovered than probable reserves. The total quantities ultimately recovered from the project have a low probability to exceed the sum of proved plus probable plus possible (3P), which is equivalent to the high estimate scenario. In this context, when probabilistic methods are used, there should be at least a 10% probability that the actual quantities recovered will equal or exceed the 3P estimate.

 

Contingent resources

Contingent resources are those quantities of petroleum estimated, as of a given date, to be potentially recoverable from known accumulations, but the applied project(s) are not yet considered mature enough for commercial development due to one or more contingencies.

 

Contingent resources may include, for example, projects for which there are currently no viable markets, or where commercial recovery is dependent on technology under development, or where evaluation of the accumulation is insufficient to clearly assess commerciality.

 

Contingent resources are further categorised in accordance with the level of certainty associated with the estimates and may be sub-classified based on project maturity and/or characterised by their economic status.

 

Prospective resources

Prospective resources are those quantities of petroleum estimated, as of a given date, to be potentially recoverable from undiscovered accumulations. Potential accumulations are evaluated according to their chance of discovery and, assuming a discovery, the estimated quantities that would be recoverable under defined development projects.

 

 

 

 

 

 

 

 

 

 

 

THE KAZAKH OIL AND GAS LICENCING AND TAXATION ENVIRONMENT

 

Kazakhstan

The Republic of Kazakhstan is mostly in Central Asia, with a part in Eastern Europe. It borders Russia to the north and west, China to the east, Kyrgyzstan to the southeast, Uzbekistan to the south and Turkmenistan to the southwest, with a coastline along the Caspian Sea.

 

Kazakhstan is the ninth largest country by land area and the largest landlocked country. Its population is 20 million with one of the world's lowest population densities. It dominates Central Asia economically accounting for 60 per cent of the region's GDP, primarily through its oil & gas industry and its vast mineral resources.

 

Oil produced in Kazakhstan but transported through the Russian pipeline network is specifically exempted from international sanctions. However, for our recent production volumes accessing the Russian pipeline network is not economical and there are no other commercially effective distribution options to access international markets. We have sold on the domestic markets where prices are far lower but so too are the applicable taxes and operational costs and where it is permitted to trade the oil produced.

 

Oil & gas is a heavily regulated industry throughout the world, with strict rules on licencing and taxation. Set out below is a summary of the position in Kazakhstan.

 

Licensing

 

Exploration licences

The initial licence to develop a field is an exploration licence where the focus is on completing agreed work programmes. Exploration licences are typically two years in duration and it is usual for there to be several consecutive two-year exploration licence extensions agreed during the exploration phase.

 

Appraisal licences

In the event the project appears commercial, the exploration licence is typically upgraded to an appraisal licence.

 

Under an appraisal licence, oil produced incidentally while exploring and assessing may be sold but only at domestic prices. Taxation under an appraisal licence is limited with only modest deductions. Changes to the legislation in the last few years have reduced the length of appraisal licences from six to five years, with a concession of reduced social obligation payments.

 

Full production licences

To sell oil by reference to world prices requires that either the Contract Area as a whole or a particular structure has to be upgraded to a full production licence. Under a full production licence there is only limited scope to develop areas not already drilled. Additionally, a significant minority portion of production typically remains at domestic prices although the majority can be sold by reference to international prices.

 

Recent experience

Our experience with the ongoing asset acquisitions and licence upgrade applications is that the process seems to be taking significantly longer than in previous years. As set out in greater detail in the Chairman's Statement the restrictions on drilling and developing assets during the review process is accordingly having a much greater negative financial impact than expected.

 

Taxes

There are five different taxes that apply to Kazakh oil & gas producers. Each has its own basis of calculation with some being related to profits, others by reference to international oil prices and yet others by reference to the volume of oil sold. The overall impact is that as international prices increase so typically does the percentage taken by the Kazakh state.

 

 

 

 

 

 

 

 

 

 

STRATEGIC REPORT

 

Introduction

This strategic report comprises: the Group's objectives; the strategy; the business model; and a review of the Group's business using key performance indicators. The Chairman's statement, which together with the review of the Group's assets and the financial review also form the main part of the strategic review, contain an assessment of the development and performance of the Group's business during the financial year, and the position of the Group's business at the end of that year. Additionally, a summary of the principal risks and uncertainties facing the business is set out immediately after the Directors' report.

 

Objectives

The Group's objective is to create sustainable shareholder value from the development of oil & gas and mineral projects and associated activities and also other assets in Kazakhstan where the board believes they would add shareholder value.

 

The Group has a number of secondary objectives, including promoting the highest level of health and safety standards, developing our staff to their highest potential and being a good corporate citizen in our chosen countries of operations.

 

Strategy

The Group's long-term strategy is to increase shareholder value by building an attractive portfolio of oil & gas, mineral and other assets, initially in Central Asia, and in particular Kazakhstan, where the board has the greatest experience.

 

Since 2008, the Group's principal asset has been its 99% interest in the BNG Contract Area, on which both shallow and deep structures have been identified. In September 2024 shareholders overwhelmingly approved the sale of the BNG shallow structures for a headline cash consideration of $88 million of which $69.1 million has to date been received.

 

Separately, in February 2025 we announced a potential $72.5 million investment in the BNG Contract Area's deep structures from a prominent middle east institutional investor to fund the further development of the BNG Contract Area's deep structures, which if completed would result in the Group's shareholding in the BNG deep structures reduced to 50%.

 

In April 2025 the Group completed the acquisition of the West Shalva Contract Area for a maximum consideration of $15 million.

 

The Group also has a 100% interest in the Caspian Explorer, a shallow water drilling vessel designed for the northern parts of the Caspian Sea.

 

The Group has also conditionally agreed to acquire a 100% interest in the Block 8 Contract Area for a maximum consideration of $60 million, payable via royalties on future Block 8 oil production at the rate of $5 per barrel.

 

The Group is also close to making its first mineral acquisitions.

 

Business model

The business model is straightforward. To take assets at any stage of the development cycle and to improve them to the point they contribute to the Group's profitability or that they may be sold on at a profit to provide funding for additional development.

 

As important as drilling success is judging when to sell.  In 2015 we sold the Group's second Contract Area Galaz for $100 million and in 2025 we sold the ageing BNG shallow structures for $88 million.

 

Approaching $200 million has been spent on the BNG assets of which approximately $120 million has been spent by the Group since 2008, the majority of which on the deep structures.  Success with BNG's deep structures would be a transformative event.  The $72.5 million third party funding identified to further develop BNG's deep structures would help diversify the Group's risk and allow other projects to be progressed while still maintaining significant upside potential.

 

We also believe Block 8 has the potential to at least match BNG. West Shalva adds a third oil & gas asset, but without the high temperature and pressures present at BNG and Block 8.

 

Mineral and other acquisitions are expected to further diversify risk and generate revenues at a faster pace than early stage oil & gas projects.

 

 

Further growth by acquisition

The Group will consider acquiring additional assets or related businesses where the Board believes they would increase shareholder value, including assets outside its core oil & gas and mineral sectors where such acquisitions would not represent the majority of the Group's activities.

 

The Directors also believe the Group is exceptionally well placed through its strong local Kazakh presence to identify and buy undervalued oil & gas assets and mineral and other assets on an opportunistic basis.

 

Climate Change

As principally a natural resources exploration and production company, we recognise our environmental responsibilities to all our stakeholders and in particular to the local communities in which we operate.

 

However, other than a longer term general move away from fossil fuels once renewable alternatives are available in sufficient quantities and at comparable prices, the Board is not aware of any indications that the impact of climate change is likely to have a material impact on the Group's business over the short and medium terms.  We believe the current need for oil will continue for many decades to come.

 

Key performance indicators

 

The Non-Financial Key Performance Indicators (based on continuing and discontinued activities) were:

 

·      Operational (active wells not identified for abandonment at end of year) 2024: 10 (2023: 8)

·      Aggregate production for 2024: 623,312 mmbls (2023: 665,114 barrels) a fall of 6%

·      Reserves at 31 December 2024

o  Shallow structures: 13.0 mmbls P1 & 24.2 mmbls P2 (2023: 13.6 P1 mmbls & 24.8 P2 mmbls)  -but subsequently sold

o  Airshagyl deep structure (in the immediate vicinity of the drainage area around wells A5, A6 & A7):  were independently assessed at 31 December 2024 as C1 49 mmbls & C2 28.9 mmbls, of which the Kazakh State Geological Committee in May 2025 has initially confirmed C1 reserves of 26 mmbls with scope to increase the certified amount over the next three years

 

The Financial Key Performance Indicators (based on continued and discontinued operations) were:

 

·      Revenue: up 43% at $52.3 million of which $31.5 million is from continuing operations (2023: $36.7 million of which $15.0 million is from continuing operations)

·      Profit before tax $17.1 million of which $5.3 million is from continuing operations (2023: $14.8 million of which a loss of $0.2 million is from continuing operations)

·      Profit after tax for the year $16.8 million of which $7.4 million is from continuing operations (2023: $11.1 million of which a loss of  0.9 million is from continuing operations)

·      Cash at bank: $2.6 million (2023: $1.2 million)

·      Total assets: $135.2 million (2023: $134.9 million)

·      Unproven oil & gas assets $49.1 million (2023: $52.0 million)

 

Assets & Reserves

Further details of the Group's assets and reserves are set out in the Chairman's statement and throughout this Annual Report.

 

Financial

The proceeds from the sale of the BNG shallow structures has provided funding to pay down the Group's debts, fund the further development of existing and previously announced assets and to fund the acquisition and development of a number of new projects.

 

Potential sources of additional funding if required would include advances from local oil traders for the sale of oil yet to be produced; industry funding in the form of partnerships with larger industry players; further support from existing shareholders; and equity funding from financial institutions. Additionally, funding may be available from selected asset sales or from the acquisition for shares of cash generative businesses.

 

Dividends

The Board has decided against the resumption of regular dividend payments in favour of periodic special dividends and / or share buy backs, although none are currently proposed.

 

 

 

 

S. 172 Statement

The Board is mindful of the duties of directors under S.172 of the Companies Act 2006.

 

Directors act in a way they consider, in good faith, to be most likely to promote the success of the Company for the benefit of its members. In doing so, they each have regard to a range of matters when making decisions for the long term success of the Company.

 

Our culture is that of treating everyone fairly and with respect and this extends to all our principal stakeholders. Through engaging formally and informally with our key stakeholders, we have been able to develop an understanding of their needs, assess their perspectives and monitor their impact on our strategic ambition.

 

As part of the Board's decision-making process, the Board and its committees consider the potential impact of decisions on relevant stakeholders whilst also having regard to a number of broader factors, including the impact of the Company's operations on the community and environment, responsible business practices and the likely consequences of decisions in the long term.

 

Our objective is to act in a way that meets the long term needs of all our main stakeholder groups. However, in so doing we pay particular regard to the longer term needs of shareholders. We engage with investors on our financial performance, strategy and business model. Our Annual General Meeting provides an opportunity for investors to meet and engage with members of the Board. The Board also continues to encourage senior management to engage with staff, suppliers, customers and the community in order to assist the Board in discharging its obligations.

 

Further details of how the Directors have had regard to the issues, factors and stakeholders considered relevant in complying with S 172 (1) (a)-(f), the methods used to engage with stakeholders and the effect on the Group's decisions during the year can be found throughout this report and in particular at page 21 (where the Group's strategy, objectives and business model are addressed), page 24 (in relation to employees) the ESG report on page 29 (in relation to social and environmental matters).

 

We seek to attract and retain staff by acting as a responsible employer. The health and safety of our employees is important to the Group and an area we have to regularly report on to the Kazakh regulatory authorities.

 

We continue to provide support to communities and governments through the provision of employment, the payment of taxes and supporting social and economic development in the surrounding areas, both through social investment and local procurement. We have contributed to a range of social programmes for well over a decade.

 

We have established long-term partnerships that complement our in-house expertise and have built a network of specialised partners within the industry and beyond.

 

Clive Carver

Chairman

28 November 2025

 

 

 

 

DIRECTORS' REPORT

 

The Directors present their annual report on the operations of the Company and the Group, together with the audited financial statements for the year ended 31 December 2024.

 

The Strategic Report forms part of the business review for this year.

 

Principal activities

The principal focus of the Group is on

 

·      oil exploration and production  

·      oil trading

·      onshore and offshore oilfield services

·      mineral exploration and production

 

All the Groups operational activities are in Kazakhstan.

 

Results and dividends

The consolidated statement of profit or loss is set out on page 46 and shows a $16.8 million profit for the year after tax (2023: US$11.1 million).

 

The Board has decided not to resume regular dividend payments but rather to look to periodically declare special dividends and / or share buy backs although none are currently proposed.

 

Review of the year

The review of the year and the Directors' strategy are set out in the Chairman's Statement, the Strategic Report and throughout these financial statements.

 

Events after the reporting period

Other than the operational and financial matters set out in these financial statements there have been no material events between 31 December 2024, and the date of this report, which are required to be brought to the attention of shareholders. Please refer to note 31 of these financial statements for further details.

 

Board changes

There were no board changes during the year under review.

 

Aibek Oraziman, the Group's largest shareholder who joined the board as a non-executive director in 2020, will, effective from 1 January 2026, be appointed Chief Operating Officer, which is an executive director position. At the same time Seokwoo Shin, who joined the company in 2018 and the board as Chief Operating Officer in 2021, will become a non-executive director. These appointments will in due course result in a change in the composition of certain board committees.

 

Employees

Staff employed by the Group are based primarily in Kazakhstan.

 

The recruitment and retention of staff, especially at management level, is increasingly important as the Group continues to build its portfolio of oil & gas and mineral assets. As well as providing employees with appropriate remuneration and other benefits together with a safe and enjoyable working environment, the Board recognises the importance of communicating with employees to motivate them and involve them fully in the business.

 

For the most part, this communication takes place at a local level and staff are kept informed of major developments through email updates. They also have access to the Group's website.

 

The Group has taken out full indemnity insurance on behalf of the Directors and its officers.

 

Health, safety and environment

It is the Group's policy and practice to comply with health, safety and environmental regulations and the requirements of the countries in which it operates, to protect its employees, assets and the environment.

 

Environmental reporting

The Group is exempt from the Streamlined Energy and Carbon Reporting (SECR) requirements since its energy consumption is less than 40,000 kWh per annum in the UK.

 

 

Charitable and Political donations

During the year the Group made no charitable or political donations.

 

Directors and Directors' interests

The Directors of the Group and the Company who held office during the period under review and up to the date of these financial statements are as follows:

 

Directors' interests

Director	Number of Ordinary Shares
	As at 31 December 2024	As at 31 December 2023
Clive Carver	2,245,000	2,245,000
Kuat Oraziman*	nil	nil
Aibek Oraziman*	1,046,909,031	1,046,909,031
Seokwoo Shin	nil	nil

 

* taken together on 31 December 2024 and 31 December 2023 the Oraziman Family, comprising Kuat Oraziman, Aibek Oraziman, Altynbek Bolatzhan and Bolatzhan Kerimbayev held 1,089,544,791 shares representing approximately 48.32% of the issued share capital.  Together with Daulet Beisenov they formed a Concert Party then holding 1,091,189,529 shares representing 48.39% of the issued share capital at 31 December 2024 and 31 December 2023.

 

Biographical details of the Directors are set out on the Company's website www.caspiansunrise.com.

Details of the Directors' individual remuneration, service contracts and interests in share options are shown in the Remuneration Committee Report.

 

Other shareholders over 3% at the date of this report

Shareholder	Shares held	%
Dae Han New Pharm Co Limited	224,830,964	9.55
Midiel Engineering AG	110,812,501	4.71
Ahmed Al Marri	110,812,500	4.71
Abai Kalmyrzayev	79,058,642	3.36

 

Financial instruments

Details of the use of financial instruments by the Group and its subsidiary undertakings are contained in note 28 of these financial statements.

 

Statement of disclosure of information to auditor

The Directors have taken all the steps that they ought to have taken to make themselves aware of any information needed by the Group's auditor for the purposes of their audit and to establish that the auditors are aware of that information.

 

The Directors are not aware of any relevant audit information of which the auditor is unaware.

 

Auditors PKF Littlejohn LLP, who were first appointed in 2023 and reappointed in 2024, have indicated their willingness to continue in office and a resolution concerning their reappointment was approved by shareholders at the Annual General Meeting held on 25 June 2025.

 

Directors' responsibilities statement 

The Directors are responsible for preparing the annual report and the financial statements in accordance with applicable law and regulations.

 

Company law requires the Directors to prepare financial statements for each financial year. Under that law the Directors have elected to prepare the Group and Company financial statements in accordance with UK adopted international accounting standards. 

 

Under Company law the Directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Group and Company and of the profit or loss of the Group for that period.

 

The Directors are also required to prepare financial statements in accordance with the rules of the London Stock Exchange for companies trading securities on the London Stock Exchange AIM Market.

 

In preparing these financial statements, the Directors are required to:

 

·      select suitable accounting policies and then apply them consistently;

·      make judgements and accounting estimates that are reasonable and prudent;

·      state whether they have been prepared in accordance with UK adopted international accounting standards subject to any material departures disclosed and explained in the financial statements; and

·      prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company and the Group will continue in business.

 

The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Group's and the Company's transactions and disclose with reasonable accuracy at any time the financial position of the Group and the Company and enable them to ensure that the financial statements comply with the requirements of the Companies Act 2006.

 

They are also responsible for safeguarding the assets of the Group and the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

 

Website publication

The maintenance and integrity of the Group's website is the responsibility of the Directors. The Directors are responsible for ensuring the annual report and the financial statements are made available on a website.  www.caspiansunrise.com/investors/reports

 

Financial statements are published on the Group's website in accordance with legislation in the United Kingdom governing the preparation and dissemination of financial statements, which may vary from legislation in other jurisdictions.

 

The Directors' responsibility also extends to the ongoing integrity of the financial statements contained therein.

 

Responsibility statement

The Directors confirm that to the best of their knowledge

·      the financial statements, prepared in accordance with the relevant financial reporting framework, give a true and fair view of the assets, financial position and profit or loss of the Company and the undertakings included in the consolidation taken as a whole

·      the Strategic Report includes a fair review of the development and performance of the business and the position of the Company and the undertakings included in the consolidation taken as a whole, together with a description of the principal risks and uncertainties

·      the Annual Report and the financial statements taken as a whole, are fair balanced and understandable and provide the information necessary for shareholders to assess the Company's position, performance, business model and strategy.

 

Clive Carver

Chairman

28 November 2025

 

 

 

 

 

 

 

 

 

 

 

 

PRINCIPAL AND OTHER RISKS AND UNCERTAINTIES FACING THE BUSINESS

Introduction

Risk assessment and evaluation is an essential part of the Group's planning and an important aspect of the Group's internal control systems.

 

Oil & gas and mineral exploration and production are dangerous activities and as such are necessarily subject to an extremely rigorous health and safety regime. The Board aims to identify and evaluate the risks the Group faces or is likely to face in future both from its immediate activities and from the wider environment. This helps to inform and shape the Group's strategy and to quantify its tolerance to risk.

 

Operational success generally helps to mitigate financial risks. Increases in production as new wells or mines come on stream generates cash and improves the Group's financial position, which can then lead to further operational success.

 

As the Group develops, its approach to risk management and mitigation will be refined. In due course we plan to include a formal risk register including all the principal operational and non-operational risks to the business.  Such a risk register would be reviewed and assessed at least once a year.

 

The Group is subject to various risks relating to political, economic, legal, social, industry, business and financial conditions. The following risk factors, which are not exhaustive, are particularly relevant to the Group's business activities and are listed in the Board's assessment in the order of greatest potential impact.

 

Risk	Description	Mitigation
Financial risk	Oil & gas and mineral exploration and production typically requires a large upfront investment with no guarantee of success. As such the Group is exposed to the risk that it may be unable to fund its obligations under various work programme commitments and to pay creditors	The receipt of the bulk of the $88 million sale of the MJF and South Yelemes structure has significantly strengthened the Group's financial position as would the completion of an investment transaction based on selling a 50% stake in the BNG Contract Area deep structures for $72.5 million to be invested in further developing those structures.
Operating risk	Oil & gas exploration and production and mineral are dangerous activities. The Group is exposed to risks such as well blowouts, fire, pollution, bad weather and equipment failure.	The Group seeks to adopt best in class industry operating standards and complies with rigorous health & safety regulations.   The Group also seeks to work with contractors who can demonstrate similar high standards of safety.
Exploration risk	Despite the success of the BNG shallow structures, there can be no assurance the Group's exploration activities in the BNG deep structures or anywhere else will be successful.	The Group seeks to reduce this risk by acquiring and evaluating 3D seismic information before committing to drill exploration and appraisal wells.   The Group also seeks to engage suitably skilled personnel either as employees or contractors to undertake detailed assessments of the areas under exploration.
Political Risk	Political division which leads to civil disorder is likely to have an adverse impact on the Group's operations.	Widespread disorder in Kazakhstan had been absent since the Group's formation until the beginning of 2022, when the Group together with other operators was forced to suspend operations due to civil unrest.   The importance of the oil & gas and mineral industries to the Kazakh economy makes a prolonged suspension of operations unlikely, as was the case in 2022.
Russian sanctions	The sanctions imposed on Russia may affect both the Group's ability to transport its oil and the price at which the oil may be sold.   It may also affect the Group's ability to source equipment and other consumables required to produce oil.	For international sales and like most oil produced in Kazakhstan for the international market the Company's oil is transported to international buyers via the Russian oil pipeline network.   While there are and were no UK or EU sanction on Kazakh oil transported through the Russian pipeline system in practice in the past such oil was subject to a hefty unofficial "Urals Oil" discount. This made selling the Group's oil on the international market uneconomic.   More recently the discount on "Urals Oil" to international oil prices has narrowed to the point it is no longer an issue for volumes greater than those currently produced by the Group. However, for our recent levels of production and given our sales trading income we are not to date at the point where international sales are yet commercial.   We therefore currently sell all our oil either on the traditional domestic market or the domestic mini refinery market where taxes and other deductions are much lower.   Equipment and consumables previously sourced from Russia are now found elsewhere, typically China, adding  time and expense.
Permitting risks	Every stage of the Group's operations requires the approval of the industry regulators.   While the Group enjoys good working relationships with the Kazakh regulatory authorities there can be no assurances that the laws and regulations and their reinterpretation will not change in future periods and that, as a result, the Group's activities would be affected.	Regulatory delays are inevitable and common place.   Our experienced Kazakh workforce has both a thorough knowledge of the complex rules and a detailed practical understanding of the workings of each of the regulatory bodies with whom we need to deal. Accordingly, we believe we are as well placed as possible to minimise the financial impact of regulatory delays.
Pricing risk	We operate in an industry where the international price is set by world markets and the domestic price is set by the Kazakh regulatory authorities.	We have no influence on the price at which we can sell our oil or any minerals produced.   Greater storage and or financial hedging would provide some protection against adverse oil price movements but would be expensive and short lived.
Environmental risk	There would be serious consequences should there be a polluting event.	The Group seeks to maintain compliance with all applicable regulatory standards and practices.   Further information is set out in the Environmental, Social and Governance Report.
Climate change	That climate change might impact the prospects for the Group	The board does not believe in the short to medium term that climate change will have a material impact on the Group's revenues or operations. In particular the board believes the demand for oil will continue for at least the next decade and that climate change is unlikely to materially impact the Group's ability to produce that oil.
Exchange rate risk	Movements in exchange rates may result in actual losses or in the results reported in the Group financial statements.	The Group's income is denominated in US$ and Kazakh Tenge its expenditure is denominated principally in US$, Kazakh Tenge and UK £.  In the year under review and subsequently the Kazakh Tenge weakened by approximately 15% against the US$.   Any decline in the Kazakh Tenge against the US$ affects the US$ reported income for domestic sales which transacted in Tenge. However, in such circumstances the Group generally benefits as international income is unaffected but approximately 50% of the Group's costs are  incurred in Tenge reducing the US$ reported operating costs.   Given the relative strengths of the US$ and the Kazakh Tenge, the Group has decided not to seek to hedge this foreign currency exposure.
Loss of major shareholder support	In previous periods the Group has relied on the financial support of the Oraziman family, which currently holds 50.5% of the Company's shares.	The Group now has significant cash balances from the sale of the MJF and South Yelemes structures.   However, in the event further support was required it would clearly be in the interests of the Oraziman family as the major shareholding  group to provide it.
Supplier risk	Continued operations depend on regular deliveries to site of consumables, such as water, food, heating oil and replacement parts for our drilling equipment. Delays in such deliveries to site could impact production volumes. The war in Ukraine has resulted in supplies no longer being sourced from Russia.  Replacement supplies from China take much longer to arrive.	We have been operating the BNG Contract Area for more than a decade during which we have encountered numerous supply issues, all of which have been overcome.   Managing supplies has become one of the most important aspects of the business.   With a large proportion of supplies now coming from China, whose border is approximately 3,000 kilometers from the BNG Contract Area, lead times are now much greater. In addition, the working capital investment is also much greater as supplies need to be paid for much earlier than before.

ENVIRONMENTAL, SOCIAL AND GOVERNANCE (ESG) REPORT

 

This report covers our ESG approach and performance for the year ended 31 December 2024.

 

ENVIRONMENTAL

 

Introduction

Oil and gas exploration and production is a long-term activity requiring effective environmental stewardship. We have operated in Kazakhstan now for more than 18 years and have only been able to do so by complying with applicable environmental standards.

 

We recognise that society is transitioning towards a low-carbon future, and we support this goal. However, we believe that oil will continue to play an important role in the global economy for many decades to come, and new sources of oil supply will be required for a sustainable energy transition.

 

Climate change

 

Assessing the risks

We look to the Kazakh regulatory authorities to set the standards to which we work.

 

Compliance with the standards

We seek to comply with all relevant Kazakh environmental requirements, including environmental laws & regulations and industry guidelines.

 

Specific initiatives

·      We seek to recycle gas produced as a by-product at BNG to power the Contract Area's day-to-day operations.

·      We seek wherever possible to avoid flaring, which in any event is a regulated activity.

·      Our workers at the BNG Contract Area are drawn from the local community, lessening the transportation carbon footprint.

·      Where practical we make use of existing oil pipelines to move our oil.

 

Health and safety

Our daily operations prioritise health and safety and we seek to comply with all applicable health and safety related regulations.

 

SOCIAL

 

Since the Group's formation in 2006, the social obligations payments made principally to the authorities in the regions in which the group operates have funded a range of projects for the benefit of the local communities concerned.

 

GOVERNANCE

 

Introduction

Overall responsibility over the Group's corporate governance, risk management, market disclosure and related obligations rests with the Board.

 

Recently, as noted elsewhere in these financial statements, the Group has struggled to operate the board committee system set out below because of the small size of the board. Accordingly, in recent times the board as a whole has considered many of the issues typically previously dealt with by board committees.

 

Committee composition

The Governance & Risk Committee now comprises Clive Carver and Aibek Oraziman with Clive Carver acting as chairman. The committee typically meets at least once a year to review the Group's governance procedures compared to accepted industry best practice.

At the appropriate time the Board plans to include a formal risk register including all the principal operational and non-operational risks to the business to be considered by the Governance & Risk Committee.

 

Share dealing policy

The Group has adopted and operates a share dealing code for Directors and employees in accordance with the AIM Rules.

 

 

Internal controls

The Board acknowledges responsibility for maintaining appropriate internal control systems and procedures to safeguard the shareholders' investments and assets, employees and the business of the Group. The Board also intends to periodically review the Group's financial controls and operating procedures.

 

Internal audit

The Board does not consider it appropriate for the current size of the Group to establish an internal audit function. However, this will be kept under review.

 

Bribery and corruption

The UK Bribery Act 2010 came into force on 1 July 2011.

 

The Company is committed to acting ethically, fairly and with integrity in all its endeavours and compliance with legislation is monitored. The principal terms of the UK Bribery Act have been translated into Russian and circulated to our Kazakh based staff. Consideration of the UK Bribery Act is a standing item at board meetings.

 

The Company's culture

Our culture might best be described as one where we strive for commercial success while treating others fairly and with respect. The Board firmly believes that sustained success will best be achieved by following this simple philosophy. Accordingly, in dealing with each of the Group's principal stakeholders, we encourage our staff to operate in an honest and respectful manner. We also believe in getting proper value for money spent and believe this goes hand in hand with being a low-cost operator.

 

Kazakhstan plays an important part in the Group's culture. It is where we operate; where almost all staff are based; it is the nationality of most staff and of the majority of shareholders.

 

The Group is committed to promoting a culture based on ethical values and behaviours across the business. Policies are in place covering key matters such as equality, protection of sensitive information, conflicts of interest, whistleblowing and health and safety as well as environmental concerns.

 

QCA Code

Caspian Sunrise, in line with most AIM companies, elected to apply the rules of the Quoted Companies Alliance (QCA) Corporate Governance Code ("QCA Code"), which is based around 10 broad principles.

 

The QCA has introduced an updated code which for Caspian Sunrise takes effect in the financial statements for the year ended 31 December 2025.  This review is based on the existing QCA Code.

 

Principle 1   Establish a strategy and business model which promotes long term value for shareholders	Objective   Caspian Sunrise's objective is to create shareholder value from the development of oil & gas and mineral projects and associated activities.   The Group has a number of secondary objectives, including promoting the highest level of health and safety standards, developing our staff to their highest potential and being a good corporate citizen in our chosen countries of operations.   Strategy The Group's long-term strategy is to build shareholder value by assembling an attractive portfolio of oil & gas and mineral exploration and production assets in Central Asia, and more particularly in Kazakhstan where the board has the greatest experience. The Group is also exploiting associated opportunities, such as oilfield services and commodity trading, and mineral exploration and production where the board believes it can add significant value and contribute towards the success of the Group as a whole.   Our business model Our business model is to invest in and develop promising oil & gas, mineral and other projects. Success in the long term will be measured by a sustainable appreciation in the Group's profitability and, in well functioning stock markets, the Company's share price.   Principal assets The Group's principal asset is its 99% interest in the BNG Contract Area, which is in the west of Kazakhstan, 40 kilometres southeast of Tengiz on the edge of the Mangistau Oblast. In July 2025 the Group sold the MJF and South Yelemes shallow structures at the BNG Contract Area for a consideration of $88 million.   The Group owns the West Shalva Contract Area, an oilfield expected to be easier to develop than either BNG or Block 8 and nearer road and refinery infrastructure but without the potential of BNG and Block 8.   The Group owns the Caspian Explorer, a purpose built drilling vessel designed to explore the shallow reaches of the Caspian Sea. The Caspian Explorer had a construction cost of approximately $200 million in 2012 and a replacement cost believed to be approximately $300 million today.   The Group owns four drilling rigs and a wide range of equipment which allows four wells to be drilled simultaneously.   The Group is in the process of acquiring Block 8, an oilfield with many of the characteristics of BNG.   Further acquisitions particularly in the minerals sector are expected.
Principle 2   Seek to understand and meet shareholder needs and expectations	Shareholder communications   The Company communicates with its shareholders via RNS announcements, its website, formal company meetings and periodic investor presentations. However, the need to avoid selectively releasing price sensitive information often limits our ability to provide the answers many investors seek.   The Company has in recent times declined to provide information to shareholders on a selective basis believing this to be a fundamental breach of the need to treat all shareholders equally.   Our shareholders A large proportion of the Company's shares are held by a relatively small group, namely: The Oraziman family (50.5%); Korean shareholders (9.5%); shareholders in Switzerland (4.7%); shareholders in the UAE (4.7)%; with the remaining (30.6)% being principally other Kazakh or UK based investors.
Principle 3   Take into account wider stakeholder and social responsibilities and their implications for long term success	Our stakeholders In addition to our shareholders the Company regards its employees and their families, local and national government, suppliers and customers to form the core of the wider stakeholder group.   Employees Almost all staff employed by the Group are based in Kazakhstan. The Group draws most of its field workers from the Mangistau region where alternative employment opportunities are limited. At our head office in Almaty we employ further staff, some of whom hold highly skilled positions.   As well as providing employees with appropriate remuneration and other benefits together with a safe and enjoyable working environment, the Board recognises the importance of communication with employees to motivate them and involve them fully in the business. For the most part, this communication takes place at a local level, but staff are kept informed of major developments through email updates and staff meetings.   Local communities The Group has provided significant financial support to the Mangistau region for over a decade by way of social payments sometimes delivered in the form of medical or educational facilities for the local population.    Part of our work programme obligations are paid in the form of contributions to local social programmes. We are pleased to have assisted in the development of these projects and look forward to contributing to others in the coming years.   Kazakh Government agencies and regulators The Kazakh authorities are responsible for granting licences to explore for and produce oil. Licences are awarded subject to agreed work programmes being adhered to over the period of each licence renewal. This includes compliance with rules designed to preserve the environment.   Caspian Sunrise has an extremely high proportion of Kazakh nationals in our workforce and among our core shareholder group. The Board believes that this helps create a positive relationship with the Kazakh authorities and has assisted in the Group's day-to-day dealings with regulators.   External stakeholders Many additional jobs have been funded in the Company's suppliers, partners and professional advisers.   Feedback The Company considers feedback from its stakeholders in its decisions and actions.
Principle 4   Embed effective risk management, considering both opportunities and threats, throughout the organisation	Risk assessment   Oil & gas and mineral exploration and production are dangerous activities and as such are necessarily subject to an extreme health and safety regime.  Risk assessment and evaluation is an essential part of the Company's planning and an important aspect of the Company's internal control system.   It is planned to introduce a formal risk register, including all the principal operational and non-operational risks to the business. Such a risk register would be reviewed and assessed at least once a year by the Audit Committee.   A summary of the principal risks facing the Group are set out in the Principal Risks section on page 27 of these Financial Statements.   As stated elsewhere in these financial statements, the relatively small size of the board and the lack of independent non-executive directors makes the operation of the board committee systems envisaged under the QCA code difficult to follow.  The board intends to address this in due course with the appointment of additional and independent non-executive directors.
Principle 5   Maintain the board as a well-functioning, balanced team led by the chair	Board composition   The board currently comprises three executive directors and one non-executive director. All are male with two Kazakh nationals, one South Korean national and a national from the United Kingdom.   Executive directors At the executive level Kuat Oraziman, Chief Executive Officer, and Seokwoo Shin Chief Operating Officer run the Company's operations in Kazakhstan with Clive Carver, Chairman, taking the lead on financial and non-operational matters including all aspects related to the listing of the Company's shares on AIM and Corporate Governance compliance.   Kuat Oraziman is a trained geologist and member of the Academy of Sciences. He has nearly 30 years oil and gas experience in Kazakhstan.   Seokwoo Shin worked for the Korean National Oil Corporation from 1987 until 2018 with spells in Korea, the United Kingdom, Russia and most recently Kazakhstan, where he was responsible for KNOC's Kazakh oil fields. He joined Caspian Sunrise in 2018.   Clive Carver is a fellow of the Institute of Chartered Accountants in England and Wales (FCA). While working in the UK broking industry Clive gained more than 15 years' experience as a Qualified Executive under the AIM Rules having led the Corporate Finance departments of several of the larger and more active Nominated Adviser firms.   Non-executive director Aibek Oraziman, is the Company's largest shareholder with 44.5% of the Company's shares. He has more than 15 years oil and gas experience in Kazakhstan, including three years in the field at Aktobe working for a local oil company.   The board believes it possesses the skills required to build a successful and durable oil and gas business focused on Kazakhstan.   The board meets a minimum of four times each year supported by periodic telephone meetings. At such meetings the board receives a report from Kuat Oraziman on all matters operational and from Clive Carver on non-operational matters.   The board also has a list of standing items, including compliance with the UK Bribery Act, litigation, and existence of open and closed periods for director dealings, which are considered at each meeting.   The number of board meetings attended each year by the directors is set out in the Directors' report which forms part of the Annual Report and Financial Statements.   Board committees While the Audit, Remuneration and Governance committees remain in place, but with only four directors and only one non-executive director much of the work typically undertaken in the board committees has been handled by the board as a whole.   In due course we expect to make additional appointments to the board that would help return to a more traditional board committee set up.       Departures from the Code   Chairman The principal reason advanced by proponents of the Code that the Chairman be non-executive is to split the roles of Chairman and Chief Executive Officer as combining them can put too much control in one pair of hands. This is not the case with our Company where the Chief Executive Officer's family is the largest shareholding group, with some 50.5%.   Clive Carver was appointed Non-Executive Chairman of the Company in 2006 in the lead-up to the IPO the following year. In 2012 he was appointed Executive Chairman at the same time as Kuat Oraziman moved from Non-Executive Director to Chief Executive Officer.   Clive Carver has served as non-executive chairman of eight AIM listed companies. In addition, his 15 years as a Qualified Executive and experience as head of several active corporate finance departments make him extremely well placed to be Chairman, notwithstanding his executive status.   Non-Executive Directors' participation in Option Schemes In common with many AIM companies, we actively encourage non-executive directors to participate in the Company's option schemes, although it is not currently the case. Proponents of the Code believe this affects the independence of the non-executive directors concerned.   We believe that independence is a matter of mind, judgement, and integrity rather than having a disclosed interest in the success of the Company. We consider our non-executives' ability to act independently to be unaffected by the level of participation in the Company's option scheme.
Principle 6   Ensure that between them the directors have the necessary up-to-date experience, skills, and capabilities.	Experience   The experience of the directors is set out in the response to Principle 5 above and in the Annual Report and Financial Statements.   Operational skills are maintained through an active day to day interaction with leading international consultancies and contractors engaged to assist in the development of the Company's assets.   Non-operational skills are maintained principally via the Company's interaction with its professional advisers plus the experience gained from sitting on the boards of other commercial enterprises.   As the Company develops and moves from predominantly an oil exploration company to a balanced production and exploration company with both oil & gas and mineral projects, the board will periodically re-assess the adequacy of the skills on both the main board and the operational board. Where gaps are found, new appointments will be sought.
Principle 7   Evaluate board performance based on clear and relevant objectives, seeking continuous improvement	Performance   The Company currently does not evaluate board performance on a formal basis. However, it will in due course seek to formalise the assessment of both executive and non-executive board members.   The Company is aware of its need to facilitate succession planning and the board evaluation process would address this.
Principle 8   Promote a corporate culture that is based on ethical values and behaviours.	Culture   Our culture can best be described as one where we strive for commercial success while treating others fairly and with respect. The board firmly believes that sustained success will best be achieved by following this simple philosophy.   Accordingly, in dealing with each of the Company's principal stakeholders, we encourage our staff to operate in an honest and respectful manner.   Operating with integrity is clearly good business and forms an important part of the annual assessment of staff and in setting their pay for future periods.
Principle 9   Maintain governance structures and processes that are fit for purpose and support good decision-making by the board	Governance   The Company believes that its stated governance structures and processes are consistent with its current size and complexity, while acknowledging the size of the board as currently constituted makes adherence to such a governance regime difficult in practice.   The Board is aware that it must continue to review its practices as the Company evolves and grows and intends to make further appointments to the board as circumstances permit.   The executive members of the Board have overall responsibility for managing the day-to-day operations of the Company and the Board as a whole is responsible for implementing the Company's strategy.   The Audit Committee typically meets before each set of results (interim and final) are published and the Remuneration Committee typically meets at least once a year, when the Financial Statements for the full year results are approved. All Committee members attend these meetings.   Our Report and Accounts contain reports from the Chairman of the Remuneration. and the Audit Committees.   The appropriateness of the Company's governance structures will be reviewed annually in light of further developments of accepted best practice and the development of the Company.
Principle 10   Communicate how the company is governed and is performing by maintaining a dialogue with shareholders and other relevant stakeholders	Communications   The Company reports formally to its shareholders and the market twice each year with the release of its interim and full year results.   The Annual Report and Financial Statements set out how the corporate governance of the Company has been applied in the period under review including the work undertaken by the Audit Committee and the Remuneration Committee.   The Annual Report and Financial Statements contain full details of the principal events of the relevant period together with an assessment of current trading and prospects. They are sent to shareholders and made available on the Company's website to anyone who wishes to review them.   The Board discloses the result of general meetings by way of RNS announcements, disclosing the voting numbers. The Company's website also contains all the information prescribed for an AIM Company under Rule 26.   The Company does not typically engage in selective conversations with shareholders to avoid the risk of disclosing information on a selective basis, which is against the rules.    The company's policy towards social media is that it does not use social media. If we have something to say it is said to all shareholders at the same time via the established regulatory announcement framework and in the publication of financial and other reports.   Further details of the Company's dialogue with its shareholders are set out under Principle 2 above.   Employee stakeholders are regularly updated with the development of the Company and its performance.   We are in almost constant communication with our Governmental and regulatory stakeholders via their involvement in our day-to-day operational activities.

 

Board composition, skills and capabilities

From 1 January 2024 to 31 December 2024 the Board comprised three executive directors and one non-executive director. This remains the position at the date of this report.

 

Clive Carver, Chairman

Clive is a fellow of the Institute of Chartered Accountants in England and Wales (FCA). He is an experienced public company director having been chairman of a number of AIM companies in recent years.

 

Kuat Oraziman, Chief Executive Officer

Kuat Oraziman runs the Company's operations in Kazakhstan. Kuat Oraziman is a trained geologist and member of the Academy of Sciences. He has nearly 31 years oil and gas experience in Kazakhstan.

 

Seokwoo Shin, Chief Operating Officer

Seokwoo Shin was educated at Sungkyunkwan University in Korea.  He worked for the Korean National Oil Corporation from 1987 until 2019 with spells in Korea, the United Kingdom, Russia and most recently Kazakhstan, where he was responsible for KNOC's Kazakh oil fields. He joined Caspian Sunrise in 2018 and on 4 March 2021 was appointed to the board as Chief Operating Officer.

 

 

 

 

Aibek Oraziman, Non-executive director

Aibek Oraziman was educated in Kazakhstan and in the United Kingdom. He has more than 15 years oil and gas experience in Kazakhstan, including three years in the field at Aktobe working for a local oil company. He was appointed to the Caspian Sunrise board on 21 August 2020.

 

The Board believes it possesses the skills required to build a successful and durable oil and gas business focused on Kazakhstan but recognises in due course the need for the appointment of additional non-executive directors.

 

Board and committee meetings

Attendances of Directors at board and committee meetings convened in the year, and which they were eligible to attend in person or by telephone, are set out below:

Director	Board meetings attended	Remuneration Committees attended	Audit Committee attended	Governance committee attended
Clive Carver	4 of 4	1 of 1	2 of 2	1 of 1
Kuat Oraziman	4 of 4	N/A	N/A	N/A
Seokwoo Shin	4 of 4	N/A	N/A	N/A
Aibek Oraziman	4 of 4	1 of 1	2 of 2	1 of 1

 

The Board has established the following committees:

 

Audit Committee

The Audit Committee which comprises Aibek Oraziman and Clive Carver, with Clive Carver as acting Chairman, determines and examines any matters relating to the financial affairs of the Group including the terms of engagement of the Group's auditors and, in consultation with the auditor, the scope of the audit.

 

The Audit Committee receives and reviews reports from the management and the external auditor of the Group relating to the annual and interim accounts and the accounting and internal control systems of the Group. In addition, it considers the financial performance, position and prospects of the Group and the Company and ensures they are properly monitored and reported on.

 

Remuneration Committee

The Remuneration Committee, which comprises Aibek Oraziman and Clive Carver, with Aibek Oraziman as Chairman, reviews the performance of the senior management, sets and reviews their remuneration and the terms of their service contracts and considers the Group's bonus and option schemes.

 

Board committee membership in 2024

Director	Audit Committee		Remuneration Committee		Corporate Governance Committee
	Served from	Served to	Served from	Served to	Served from	Served to
Clive Carver	1 January	31 December	1 January	31 December	1 January	31 December
Kuat Oraziman	N/A	N/A	N/A	N/A	N/A	N/A
Seokwoo Shin	N/A	N/A	N/A	N/A	N/A	N/A
Aibek Oraziman	1 January	31 December	1 January	31 December	1 January	31 December

 

Clive Carver

Chairman

28 November 2025

 

 

 

 

 

 

 

 

 

 

 

 

 

REMUNERATION COMMITTEE REPORT

 

Remuneration Committee

Between 1 January 2024 and 31 December 2024, the Remuneration Committee comprised Aibek Oraziman and Clive Carver and was chaired by Aibek Oraziman.

 

Remuneration policy

The Remuneration Committee determines the contract term, basic salary, and other remuneration for the members of the Board and the senior management team.

 

The Group's and the Company's policy is to provide remuneration packages that will attract, retain and motivate its executive Directors and senior management. This consists of a basic salary, ancillary benefits and other performance-related remuneration appropriate to their individual responsibilities and having regard to the remuneration levels of comparable posts. However, starting in 2020 the Covid-19 impact on the Group's finances required the Directors to accept reductions of up to 75% of contracted salary which continued to be the case throughout 2024 and to date in 2025.

 

Service contracts

Details of the current Directors' service contracts are as follows:

Executive		Date of service agreement / appointment letter	Date of last renewal of appointment
Clive Carver	20 March 2019			27 June 2024
Kuat Oraziman	6 December 2019			30 June 2023
Aibek Oraziman	21 August 2020			30 June 2023
Seokwoo Shin	4 March 2021			30 June 2023

 

Basic salary and benefits

The basic salaries of the Directors who served during the financial year are established by reference to their responsibilities and individual performance.

 

Directors	Role	2024 Salary / fees US$	2024 Benefits US$		2024 Total US$		2023 Total US$
Clive Carver	Chairman	152,698		-		152,698		162,503
Kuat Oraziman	CEO	99,930		-		99,930		145,484
Seokwoo Shin	COO	60,000		-		60,000		55,000
Aibek Oraziman	Non-executive	60,000		-		60,000		55,000
Edmund Limerick	Non-executive	-		-		-		72,382
Total		372,628		-		372,628		490,369

Edmund Limerick resigned as a director effective from 7 July 2023.

There were no company pension contributions in respect of any director.

 

Bonus schemes

All Executive Directors are eligible for consideration of participation in the Company bonus scheme.  However, as in previous years no bonuses are payable in respect of the year ended 31 December 2024 (2023: $ nil).

 

Long term incentives

 

Share options

The current interests as at the date of the approval of these financial statements of the current Directors in share options agreements are as follows:

Directors	Granted	Exercise price (p)	Expiry Date
Clive Carver	2,400,000	4	30 April 2025
Seokwoo Shin	2,500,000	4	24 April 2034

 

On 24 April 2024 the Company awarded 2,500,000 new 4p options to Seokwoo Shin, a director of the Company, 2,500,000 5.5p options previously awarded to Seokwoo Shin have been cancelled,

 

The position as set out in the 2023 financial statements was as follows:

Directors	Granted	Exercise price (p)	Grant date	Expiry Date
Clive Carver	2,400,000	4	15 December 2013	30 April 2025
Clive Carver	3,000,000	20	22 August 2014	21 August 2024
Kuat Oraziman	3,000,000	20	22 August 2014	21 August 2024
Seokwoo Shin	2,500,000	4	10 January 2022	17 April 2034

 

There were no options exercised or granted in 2024. The total number of options at the date of this report is 9,000,000 representing approximately 0.38% of the total number of issued shares.

 

Cash based incentives

In May 2019, we introduced cash based long term incentive arrangements for the senior management team since 2012, Kuat Oraziman and Clive Carver. Under these arrangements, provided the share price growth exceeds pre-set targets starting at 17.23p, then for every $500 million increase in the Group's market capitalisation above $300 million, as adjusted to take account of dividends paid, both Kuat Oraziman and Clive Carver, would receive payments of $3 million each.

 

The principal hurdles under these arrangements are set out in the table below.

Market cap threshold	Share price target	Pay-out rate (each)	Pay-out amount (each)
$' billion	Pence per share	%	$' million
0.8	17.23	0.6	3.0
1.3	20.67	0.6	3.0
1.8	24.81	0.6	3.0
2.3	29.77	0.6	3.0
2.8	35.72	0.6	3.0

 

The scheme continues beyond the numbers in the table such that with the threshold for market capitalisation increasing at the rate of $0.5 billion and the corresponding share price threshold increasing from the earlier threshold by a constant factor of 1.2.

Each threshold must be sustained for at least 30 consecutive days for the awards to be triggered. There may be only one pay-out for each market capitalisation threshold crossed no matter how many times it is crossed.

On behalf of the Directors of Caspian Sunrise plc

Aibek Oraziman

Chairman of Remuneration Committee

28 November 2025

 

AUDIT COMMITTEE REPORT

 

The Audit Committee

The Audit Committee, which between 1 January and 31 December 2024 comprised Clive Carver and Aibek Oraziman, with Clive Carver as the acting Chairman, determines and examines any matters relating to the financial affairs of the Group including the terms of engagement of the Group's auditors and, in consultation with the auditor, the scope of the audit.

 

Role and responsibilities

The Audit Committee is responsible for monitoring the integrity of the Company's financial statements, reviewing significant financial reporting issues, reviewing the effectiveness of the Group's internal control and risk management systems.

 

In addition, it considers the financial performance, position and prospects of the Group and the Company and ensures they are properly monitored and reported on. It oversees the relationship with the Auditor (including advising on their appointment, agreeing the scope of the audit and reviewing the audit findings).

 

Meetings

The committee met on two occasions during the year under review.

 

Internal audit

The Board and the Audit Committee do not consider it appropriate for the current size of the Group to establish an internal audit function. However, this will be kept under review.

 

Attendance at Audit Committee meetings

Please see the table in the preceding Corporate Governance Report for attendance by the members of the Audit Committee.

 

Group auditors

In October 2023 PKF Littlejohn LLP were appointed Group auditors and were reappointed at the Annual General Meetings in June 2024 and June 2025.

 

On behalf of the Directors of Caspian Sunrise plc

 

Clive Carver

Acting Chairman of Audit Committee

28 November 2025

 

 

 

INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF CASPIAN SUNRISE PLC

 

Opinion

We have audited the financial statements of Caspian Sunrise Plc (the 'Parent Company') and its subsidiaries (the 'Group') for the year ended 31 December 2024 which comprise the Consolidated Statement of Profit or Loss, the Consolidated Statement of Other Comprehensive Income, the Consolidated and Parent Company Statement of Financial Position, the Consolidated and Parent Company Statements of Changes in Equity, the Consolidated and Parent Company Statements of Cash Flows and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and UK-adopted international accounting standards and as regards the Parent Company financial statements, as applied in accordance with the provisions of the Companies Act 2006.

In our opinion:

·     the financial statements give a true and fair view of the state of the Group's and of the Parent Company's affairs as at 31 December 2024 and of the Group's profit for the year then ended;

·     the Group financial statements have been properly prepared in accordance with UK-adopted international accounting standards;

·     the Parent Company financial statements have been properly prepared in accordance with UK-adopted international accounting standards and as applied in accordance with the provisions of the Companies Act 2006; and

·     the financial statements have been prepared in accordance with the requirements of the Companies Act 2006.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the Group and Parent Company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC's Ethical Standard as applied to listed entities, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate. Our evaluation of the directors' assessment of the Group's and Parent Company's ability to continue to adopt the going concern basis of accounting included

·     Obtaining the directors' going concern assessment and evaluating the appropriateness of this assessment;

·     Obtaining management's base case forecasts covering the period to 31 December 2026 used to support this assessment, ascertaining the key assumptions and inputs used in the preparation of the forecasts, and assessing the reasonableness of such assumptions and inputs. This included, where possible, agreeing the inputs to underlying supporting documentation, and sensitising key assumptions;

·     Comparing forecast income and expenses with recent historical financial information to consider the accuracy of management's forecasting; 

·     Agreeing the latest post-year end cash balances to the working capital position within the going concern forecast and testing the mathematical accuracy of the forecasts;

·     Obtaining management's downside scenarios, which reflects management's assessment of uncertainty and the mitigating actions in place, and evaluating the assumptions regarding reduced trading levels under this scenario;

·     Considering post-year end events and their impact on the group's financial position; and

·     Assessing the appropriateness and completeness of disclosures in respect of going concern made in the financial statements.

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Group's or Parent Company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.

Our application of materiality

We apply the concept of materiality in both planning and performing the audit and evaluating the effect of misstatements. Based on our professional judgement, we determined materiality for the financial statements as follows:

	Group financial statements	Parent Company financial statements
Materiality	USD 2,010,000 (2023: USD 1,960,000)	USD 1,450,000 (2023: USD 1,170,000)
Basis for determining materiality	1.5% of gross assets (2023: 1.5% of gross assets)	1.5% of net assets (2023: 3% of net assets)
Rationale for the benchmark applied	We have determined an asset based measure is appropriate as the Group continues to focus on the development of its key oil and gas exploration and production activities, which require significant capital expenditure.	The Parent Company is a holding company; therefore, materiality was set on the net assets basis.

 

Performance materiality

We set performance materiality at a level lower than materiality to reduce the probability that, in aggregate, uncorrected and undetected misstatements exceed the materiality for the financial statements as a whole.

	Group financial statements	Parent Company financial statements
Performance materiality	USD 1,206,000 (2023: USD 1,176,000)	USD 870,000 (2023: USD 702,000)
Basis for determining materiality	60% of materiality (2023: 60% of materiality)	60% of materiality (2023: 60% of materiality)
Rationale for the benchmark applied	Performance materiality for the current year was set based our assessment of the control environment including identified control deficiencies.

 

Our audit procedures were performed to materiality levels applicable to each component, which were lower than the Group materiality level and ranged from USD 730,000 to USD 1,000,000 depending on that component's asset contribution.

In the audit of each component, we further applied performance materiality levels of 60% of the component materiality to our testing to ensure that the risk of errors exceeding component materiality was appropriately mitigated.

We agreed with those charged with governance that we would report to them all audit differences identified during the course of our audit in excess of USD 100,500 (2023: USD 98,000) for the Group and USD 87,000 (2023: USD 58,500) for the Parent Company. We also agreed to report any other audit misstatements below that threshold that we believe warranted reporting on qualitative grounds.

 

Our approach to the audit

Our audit approach was developed by obtaining an understanding of the Group's and Parent Company's activities, the key subjective judgments made by the directors, for example in respect of the significant accounting estimates regarding the valuation of unproven oil and gas assets, as well as revenue recognition and classification and valuation of assets held for sale, as well as considering future events that are inherently uncertain, and the overall control environment. Based on this understanding we assessed those aspects of the Group's and Parent Company's transactions and balances which were most likely to give rise to a material misstatement and were most susceptible to irregularities including fraud or error. Specifically, we identified what we considered to be the key audit matter and planned our audit approach accordingly.

The Group's operations principally comprise oil and gas exploration and production in Kazakhstan. We assessed there to be five material components, in addition to the Parent Company. Three of these five components were subject to full scope audit and two components were subject to audit procedures on specific account balances, disclosures, or classes of transaction.

A non-PKF member firm performed the audit work on these five components, under our direction and supervision as Group auditors. The audit of the Parent Company and the Group consolidation were performed in the United Kingdom by PKF Littlejohn as group auditor. The Group audit team performed additional procedures in respect of certain significant risk areas including the key audit matter.

Our involvement with component auditors included the following:

•    Detailed Group reporting instructions were sent to the component auditor, which included the significant areas to be covered by the audit. 

•    We reviewed the component auditor's working papers remotely from the UK.  In addition, we reviewed the Group reporting submissions received from the component audit teams and held regular calls with the component audit teams during the planning, fieldwork and completion phases of their audit to discuss significant findings from their audit. 

•    We performed additional top-up procedures in respect of the significant risk areas where deemed necessary.

Key audit matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements of the current period and include the most significant assessed risks of material misstatement (whether or not due to fraud) we identified, including those which had the greatest effect on: the overall audit strategy, the allocation of resources in the audit; and directing the efforts of the engagement team. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

 

Key Audit Matter	How our scope addressed this matter
Carrying value of unproven oil and gas assets - Note 2.1.9 and 13
The carrying value of the Group's unproven oil and gas assets as at 31 December 2024 was USD 49,148,000 (2023: USD 51,963,000).   In accordance with IFRS 6 Exploration for and Evaluation of Mineral Resources, assets should be held at cost and an annual assessment of impairment indicators should be performed.   Given the level of management estimates and judgement required in determining the recoverability of these assets, there is a risk that management may not adequately identify all impairment indicators as outlined in IFRS 6.  As such, there is a risk that the carrying value of these assets is impaired and that exploration and development costs capitalised during the year have not been capitalised in accordance with IFRS 6.   As a result of the significant estimates and judgement required to be exercised by management, we consider this to be a key audit matter.	Our work in this area included the following: ·      Reviewing the work of the component auditor's testing of additions in the year, as well as obtaining the applicable exploration licences to ensure that these are valid and that relevant terms have been complied with; ·      Obtaining confirmation that the Group has good title to the applicable exploration licences, and assessing compliance with terms of the licences through making enquiries of management and the legal consultant; ·      Obtaining management's review of indicators of impairment, reviewing and challenging management's assessment and independently considering whether any of the impairment indicators as per IFRS 6 have been met and, if so, whether any impairment is necessary; ·      Obtaining and reviewing management's impairment assessment in accordance with IAS 36, corroborating and providing challenge to key inputs, and performing stress testing of the model under a range of scenarios; ·      Evaluating available technical reports to determine whether the inputs and judgments applied in management's impairment review adequately support the carrying value of unproven oil and gas assets as of 31 December 2024; ·      Inspecting cash flow forecasts to confirm that further drilling and exploration is planned for the licenced areas, as well as reviewing internal and external information available during the year and post-year end such as Board minutes and Regulatory News Service announcements for evidence of potential impairment ·      Evaluation of the results of exploration activity in the year for indications that the licences would be abandoned or that the recoverable value would be below carrying value; and ·      Reviewing disclosures in the financial statements to ensure compliance with the requirements of IFRS.   Key observations   We draw attention to the disclosure within Note 13 Unproven oil and gas assets and Note 2.1.9 within Critical accounting estimates and judgements which confirm the post-year end award of a 25 year production licence on the Airshagyl structure, for an initial three year period, during which additional reserves may be credited based on drilling results. The application to upgrade to a production licence for the Yelemes deep structure remains with the Kazakh regulatory authorities at the date of these financial statements.    Should the Airshagyl production licence not be extended beyond the initial three year period, and / or the Yelemes deep licence not be forthcoming, then this could trigger an impairment to the carrying value of exploration and evaluation assets.

 

Other information

The other information comprises the information included in the annual report, other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. Our opinion on the Group and Parent Company financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of the audit:

·    the information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and

·    the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the Group and the Parent Company and their environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.

We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:

·     adequate accounting records have not been kept by the Parent Company, or returns adequate for our audit have not been received from branches not visited by us; or

·     the Parent Company financial statements are not in agreement with the accounting records and returns; or

·     certain disclosures of directors' remuneration specified by law are not made; or

·     we have not received all the information and explanations we require for our audit.

Responsibilities of directors

As explained more fully in the Directors' responsibilities statement, the directors are responsible for the preparation of the Group and Parent Company financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the Group and Parent Company financial statements, the directors are responsible for assessing the Group and the Parent Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Group or the Parent Company or to cease operations, or have no realistic alternative but to do so.

Auditor's responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

 

·     We obtained an understanding of the company and the sector in which it operates to identify laws and regulations that could reasonably be expected to have a direct effect on the financial statements. We obtained our understanding in this regard through

o  discussing with management, those charged with governance and those responsible for legal and compliance procedures, to understand how the Group is complying with those legal and regulatory frameworks; and

o  conducting and applying industry research and application of cumulative audit knowledge.

·     We determined the principal laws and regulations relevant to the company in this regard to be those arising from:

o  UK-adopted international accounting standards;

o  Companies Act 2006;

o  AIM Rules and the Quoted Companies Alliance Corporate Governance Code;

o  Relevant industry laws and regulations in Kazakhstan, including relevant environmental regulations associated with oil and gas exploration and production activities;

o  UK and Kazakh taxation and employment laws; and

o  Terms of compliance included in the Group's production and exploration licences.

·     We designed our audit procedures to ensure the audit team considered whether there were any indications of non-compliance by the company with those laws and regulations. These procedures included, but were not limited to:

o  Reviewing minutes of meeting of those charged with governance for any instances of non-compliance with laws and regulations;

o  Review of Regulatory News Service announcements;

o  Directing the auditors of the significant components to ensure an assessment was performed on the extent of the components' compliance with the relevant local and regulatory environment and a review of correspondence with regulatory and tax authorities was performed for any instances of non-compliance with laws and regulations;

o  Reviewing the terms of the relevant licences pertaining to proven and unproven oil and gas assets to assess the extent to which the Group was in compliance with the conditions of the licence and considering management's assessment of the impact of instances of non-compliance where applicable; and

o  Review of legal expenditure accounts to understand the nature of expenditure incurred.

·     We also identified the risks of material misstatement of the financial statements due to fraud. We considered, in addition to the non-rebuttable presumption of a risk of fraud arising from management override of controls, that the area most susceptible to fraud was the valuation of unproven oil and gas assets, on the basis that there is potential for management bias as a result of judgement being exercised, and we addressed this by challenging the assumptions and judgements made by management when auditing these areas. See Key Audit Matter section above.

·    As in all of our audits, we addressed the risk of fraud arising from management override of controls by performing audit procedures which included, but were not limited to: the testing of journals;  reviewing accounting estimates for evidence of bias; and evaluating the business rationale of any significant transactions that are unusual or outside the normal course of business. 

Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

 

 

Use of our report

This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone, other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed.

 

Imogen Massey (Senior Statutory Auditor)                                                                      15 Westferry Circus

For and on behalf of PKF Littlejohn LLP                                                                               Canary Wharf

Statutory Auditor                                                                                                              London E14 4HD

28 November 2025

 

Consolidated Statement of Profit or Loss
	Notes	Year ended 31 December 2024	*Restated Year ended 31 December 2023
		US$'000	US$'000
Continuing Operations:
Revenue	4	31,470	15,036
Cost of sales		(22,221)	(10,838)
Gross profit		9,249	4,198
Selling expense		(167)	(1,947)
Administrative costs		(3,967)	(6,031)
Other operating income	5	-	3,774
Operating profit	5	5,115	(6)
Finance cost	8	(365)	(399)
Finance income	9	501	231
Profit before taxation		5,251	(174)
Tax credit / (charge)	10	2,109	(689)
Profit after taxation from continuing operations		7,360	(863)
Discontinued operations(#) Profit for the year from discontinued operations	11	9,431	11,968
Profit for the year		16,791	11,105
Profit for the year attributable to owners of the parent		16,614	10,590
Profit for the year attributable to non-controlling interest		177	515
		16,791	11,105
Profit / (loss) attributable to owners of the parent arises from:
Continuing operations		7,278	(1,258)
Discontinued operations		9,336	11,848
		16,614	10,590
Earnings per ordinary share attributable to owners of the parent
From continuing operations:
Basic and diluted (US cents)	12	0.32	(0.06)
From continuing and discontinued operations:
Basic and diluted (US cents)	12	0.74	0.47

*See note 3 for details of prior year restatement.

 

(#) The discontinued operations noted above relate only to the MJF and South Yelemes structures on the BNG Contract Area, which were sold for $88 million in July 2025.

           

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated Statement of Comprehensive Income

 

 

	Year ended 31 December 2024	*Restated Year ended 31 December 2023
	US$'000	US$'000
Profit after taxation	16,791	11,105
Other comprehensive income, net of tax:
Items that may be subsequently reclassified to profit or loss:
Exchange differences on translating foreign operations	(11,295)	676
Total comprehensive  income for the year	5,496	11,781
Total comprehensive income attributable to:
Owners of parent	5,319	11,266
Non-controlling interest	177	515
Total comprehensive income for the year	5,496	11,781