t
Sunda Energy Plc announced its audited financial results for the year ended 31 December 2024, including cash reserves of £3.20m and a loss after taxation of £2.05m. The company completed a placing, subscription and WRAP retail offer of new ordinary shares at 0.05p to raise £3.26 million (gross) in February 2024. Furthermore, Sunda Energy entered into a farm-out agreement with TIMOR GAP, assigning them an additional 30% working interest, expected to close in June 2025.
| Date | 2 Jun 2025 |
| Time | 07:00:13 |
| Category | Results |
| ID | 9732K |
2 June 2025
Sunda Energy Plc
("Sunda Energy", "Sunda", the "Company", or the "Group")
Final Results for the Year Ended 31 December 2024
Sunda Energy (AIM: SNDA), the AIM-quoted exploration and appraisal company focused on gas assets in Southeast Asia, is pleased to announce its audited financial results for the year ended 31 December 2024.
Operational Highlights for 2024
· Farm-in completed with TIMOR GAP, increasing their working interest from 25% to 40%, resulting in TIMOR GAP being responsible for 20% of PSC costs.
· Memorandum of Understanding signed with MPRM and TIMOR GAP, setting the framework for joint evaluation of a development concept for gas resources on Chuditch.
· Application for two offshore licence areas in the Philippines, which sit in an area that the Sunda team knows well and where there is potential for vast energy resources.
· UK Licence P2478 relinquished with all commitments having been fulfilled.
Post-period end developments
· Entered into further farm-in agreement with TIMOR GAP, assigning them an additional 30% working interest resulting in their interest increasing to 70% on completion. Expected to close in June 2025.
· Completed an Environmental Baseline Survey in the area of the planned Chuditch well, with results integrated into the Environmental Impact Statement and the Environmental Management Plan.
Financial Highlights for 2024
· Cash Reserves at 31 December 2024 were £3.20m (31 December 2023: £3.76m).
· Loss after taxation of £2.05m (2023: £1.71m).
· Completed a Placing, Subscription and WRAP Retail Offer of new ordinary shares at 0.05p to raise £3.26 million (gross) in February 2024.
Post-period end developments
· Issuance of convertible loan notes to three institutional investors raising up to US$9.0 million to fund Sunda's share of the PSC costs.
Commenting on the results, Gerry Aherne, Non-Executive Chairman, said:
"2024 was a year of tremendous change for the Company. With significant changes to the Board, management and direction, it made sense to change the name. Sunda Energy Plc is now a company truly focused on SE Asia, and in particular gas projects in that region. The Company has built on its exciting and valuable asset in Timor-Leste, putting together a highly experienced operating team and evaluating a pipeline of material new venture opportunities across the region.
"I extend my thanks to all stakeholders of the Company, including my fellow directors, our dedicated and hard-working employees and consultants, and our Timorese joint venture and government partners, for their strong support of the Company's efforts."
Posting of Annual Report and Notice of AGM
The Company's Annual Report and Financial Statements for the year ended 31 December 2024 will be available for download from the Company's website (https://sundaenergy.com/) later today and will be despatched by post shortly to shareholders.
The Company will hold its Annual General Meeting at 11a.m. BST on 27 June 2025 at Riverbank House, 2 Swan Lane, London, EC4R 3TT. The Notice of Annual General Meeting will be sent to shareholders shortly and will be available on the Company's website (www.sundaenergy.com).
For further information, please contact:
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Sunda Energy Plc Andy Butler, Chief Executive Rob Collins, Chief Financial Officer
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Tel: +44 (0) 20 7770 6424 |
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Allenby Capital Limited (Nominated Adviser and Joint Broker) Nick Athanas, Nick Harriss, Ashur Joseph (Corporate Finance) Kelly Gardiner, Stefano Aquilino (Sales and Corporate Broking)
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Tel: +44 (0) 203 328 5656 |
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Hannam & Partners Advisory Limited (Advisor and Joint Broker) Neil Passmore (Corporate Finance) Leif Powis (Sales)
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Tel: +44 (0) 20 7907 8502
|
|
Celicourt Communications (Financial PR and IR) Mark Antelme, Philip Dennis, Charles Denley-Myerson |
Tel: +44 (0) 20 7770 6424 |
Qualified Person's Statement
Pursuant to the requirements of the AIM Rules - Note for Mining and Oil and Gas Companies, the technical information and resource reporting contained in this announcement has been reviewed by Dr Andrew Butler, Fellow of the Geological Society of London and member of the Society of Petroleum Engineers. Dr Butler has more than 28 years' experience as a petroleum geologist. He has compiled, read and approved the technical disclosure in this regulatory announcement and indicated where it does not comply with the Society of Petroleum Engineers' standard.
CHAIRMAN'S STATEMENT & OPERATIONS REPORT
Financial Review
The net result for the year was a loss both before and after taxation of £2,049,000 (2023: loss of £1,712,000), which is wholly attributable to Sunda Energy shareholders, representing a loss of 0.008p per share (2023: loss of 0.009p).
The Group generated no revenue during the period but focused on exploring and developing assets that the Board believes will generate revenue for the Group in the future.
Administration expenses for the year were £2,222,000 (2023: £1,455,000), an overall increase on the preceding year of £767,000. Administration costs arising in SundaGas (Timor-Leste Sahul) Pte. Ltd. ("TLS") and its Timor-Leste subsidiary have increased from £568,000 previously to £743,000 this year as the operation in Dili continues to gear up for the forthcoming drill phase of the Chuditch development. UK Directors and staff salaries and related costs reduced by £58,000 to £530,000 in the year, excluding severance costs paid to prior directors which amounted to £299,000. Details of directors' salaries are contained in the Report of the Directors in the Annual Report on page 18. Professional adviser fees increased from £227,000 previously to £454,000, mainly due to higher legal, consultancy and professional adviser costs.
Non-capitalised exploration and evaluation expenditure incurred included in the Income Statement amounted to £170,000 (2023: £121,000), largely arising from surface rental costs on Chuditch and new venture costs. The Directors judged that no exploration assets required impairment.
In February 2024 the Company raised £2,993,000 net of costs from the issue of new share capital by way of a placing and subscription. In addition, in February 2024, the Group received £719,000 arising from the farm-out of a 20% interest in Timor-Leste TL-SO-19-16 PSC to TIMOR GAP Chuditch Unipessoal Lda ("TIMOR GAP").
During June 2024, the Bank Guarantee for the Chuditch PSC was increased from US$1.0 million to US$2.5 million (net US$2.0 million) as the Company prepared to enter Contract Year 3 of the PSC, with its increased work commitments. The new Bank Guarantee was issued by Banco Nacional de Comércio de Timor-Leste ("BNCTL"), a bank wholly owned by the government of Timor-Leste. The use of BNCTL is part of the Company's commitment to maximising local content inside Timor-Leste, but also indicative of its objective to broaden its business partnerships in-country.
At the end of the financial year, cash reserves of the Group had decreased to £3,171,000 from a level at the preceding year end of £3,760,000 after taking into account the aforementioned capital receipts, as the Group absorbed cash in its continuing operations. The Group's investment in exploration and evaluation assets in Timor-Leste amounted to £1,783,000 in the period; a new performance bond guarantee deposit of £1,569,000 was paid out offset by recovery of a previous bond amounting to £792,000, and there was a general operating cash outflow amounting to £1,753,000. The Company achieved interest receivable of £152,000 on its bank balances.
The Group continues to take a conservative view of its asset impairment policy, giving it a statement of financial position that consists of significant net current assets and what the Board considers to be a realistic value for its exploration assets. The Board will continue to take a prudent approach in entering into new capital expenditures beyond those expected to be committed to existing ventures.
Report on Operations
Southeast Asia: Timor-Leste TL-SO-19-16 PSC ("Chuditch PSC" or "PSC") (Sunda 60% interest - since February 2024)
Background
The Chuditch PSC is located approximately 185 kilometres south of Timor-Leste, 100 kilometres east of the producing Bayu-Undan field, 50 kilometres south of the potential Greater Sunrise development and covers approximately 3,571 km2 in water depths of 40-120 metres. The Chuditch-1 discovery well, drilled by Shell in 1998 in 64 metres water depth, encountered a 30 metre gross gas column in Jurassic Plover Formation sandstone reservoirs at a depth of 2,910 metres on the flank of a large, faulted structure. The discovery and neighbouring prospects are largely covered by a 3D seismic survey acquired in 2012 and subsequently reprocessed by Sunda.
Sunda operates the PSC through its wholly owned subsidiary SundaGas Banda Unipessoal Lda. ("SundaGas"), based out of its offices in Dili, Timor-Leste. Until February 2024, the Company held a 75% working interest in partnership with TIMOR GAP Chuditch Unipessoal Lda, a subsidiary of the state-owned national oil company, who held the remaining 25% and which share of PSC expenditure is carried until first production.
On 7 February 2024, the Company completed a transaction whereby TIMOR GAP increased its participation in the PSC from 25% to 40%. Accordingly, the SundaGas 60% share became responsible for 80% of the costs of the Chuditch project and TIMOR GAP for 20%. TIMOR GAP paid approximately US$ 1 million to cover its share of prior costs from the effective date of the PSC until the completion of this transfer.
Previously, the Company had carried out a technical work programme that included the reprocessing of legacy seismic data, aimed at addressing reservoir imaging issues caused by sea-bed topography and shallow geological features as well as various geological and engineering studies. These activities fulfilled the PSC obligations for Contract Years 1 and 2 of the PSC and enabled Sunda to assess fully the Chuditch field and its gas resources.
Consultancy group ERC Equipoise Ltd ("ERCE") was then engaged to prepare a Competent Person's Report ("CPR") to provide an independent assessment of the Chuditch resource to a SPE PRMS compliant standard. The CPR was released on 28 February 2023. For the Chuditch-1 discovery, ERCE assessed gross Pmean Contingent Resources of 1.16 Tcf of gas. In addition, aggregated gross Pmean Prospective Resources attributable to the licence according to the CPR amounted to 1,562 Bcf gas across three prospects, Chuditch SW, Chuditch NE and Quokka. Geological Chances of Success ("GCOS") for these prospects range from 52% to 26%, providing substantial follow on, low risk exploration potential to any Chuditch development. It is notable that Sunda's in-house probabilistic estimates of aggregated gross Prospective Resources for these prospects, at 2,128 Bcf of gas, are higher than ERCE's estimates. This arises mainly through the Company's preferred use of the latest reprocessed seismic data velocity model to define the extent of the prospects.
Based on the above results, the Company commenced organisational and technical preparations for the drilling of an appraisal well in the second half of 2023. This appraisal well became an actual PSC commitment when Contract Year 3 began on 19 June 2024.
There continues to be an excellent working relationship between SundaGas, the Government Ministry of Petroleum and Mineral Resources ("MPRM"), Autoridade Nacional do Petróleo ("ANP"), the Government regulatory authority for petroleum, and TIMOR GAP. The Company meets regularly with all of these bodies and provides detailed updates around our activities, plans and timelines on the PSC. The Company appreciates the support that it receives from these various state entities and will continue to work on maintaining these close relationships.
2024 and subsequent activities
Planning for the drilling of the Chuditch-2 appraisal well dominated activities during 2024. A well location was selected that is 5.1km from the original Chuditch-1 discovery well in a water depth of approximately 68m. The predicted vertical column height of gas in the Jurassic reservoirs at this location is 149m, as compared with the 30m gross gas column encountered in the discovery well.
The Company decided to build an in-house drilling capability in preparation for the Chuditch-2 campaign. Taking this approach, rather than outsourcing to a drilling management company, enabled Sunda to select and retain the best personnel for the project. The Company now has a team of highly experienced drilling engineers, HSE, logistics and procurement professionals that are equipped to deliver not only the Chuditch-2 wells but also further future drilling on the PSC and more broadly within Sunda's ambitious business plans.
In February 2024 and April 2024, SundaGas completed Geophysical and Geotechnical surveys at the planned location of the Chuditch-2 appraisal well. The objective of these surveys was principally to identify any potential hazards at the proposed well site, ensuring that a drilling rig can be safely located there with minimal environmental impact. Based on survey results, Sunda's drill team chose to move the final well location by around 300m to avoid an irregular area of seabed that represented a potential hazard.
Subsequent to the reporting period, in January 2025, the Company completed an Environmental Baseline Survey ("EBS") in the area of the planned well. The purpose of the EBS was to gather information on the seabed sediments and fauna as well as collect seawater samples. The results were integrated into the Environmental Impact Statement and the Environmental Management Plan for submission to ANP, as well as being available for future assessments of any impacts caused by drilling activities. Following public consultation exercises and ANP's review, it is anticipated that final Environmental Permits for drilling will be issued in good time before mobilisation of the drilling equipment for the well.
During 2024, Sunda held discussions with a number of potential partners in the PSC that expressed interest in participating in the Chuditch project, including the drilling of the planned appraisal well and subsequent anticipated development activities. The Company announced on 12 August 2024 that it had entered into an exclusive arrangement (the "Exclusivity Agreement") with Pacific LNG Operations Pte Ltd. ("PLNG"), a private group specialising in resource investments. Ultimately, discussions with PLNG did not reach a successful conclusion and the Exclusivity Agreement was terminated. Several other parties submitted proposals to Sunda to participate in the Chuditch project, but these came with commercial terms that were unattractive or conditions that were not acceptable. These conditions included significant delays to appraisal drilling, unachievable commercial guarantees and unrealistic development concepts.
At the end of the reporting period, based on the outcome of the discussions described above and considering the strength and depth of support for the Chuditch project from the Timor-Leste authorities, the Company decided that a further farm in by TIMOR GAP represented the best route to guarantee short-term drilling of the Chuditch appraisal well, along with financing provided by certain investors into the Company. Accordingly, it was announced on 24 April 2025 that the Company had entered into a farm out agreement under which it assigned an additional 30% working interest in the PSC to TIMOR GAP, along with the issuance of a convertible loan note (and associated warrants). These combined arrangements secured the funding for the drilling of the appraisal well. The farm out transaction with TIMOR GAP is expected to close during June 2025, following the execution of a contract for a jack up drilling rig and approval by ANP.
In parallel with the environmental permitting and funding arrangements described above, all other aspects for preparation of drilling are ongoing, including procurement activities, logistical planning and coordination with various regulatory bodies in Timor-Leste. Based on the current schedule of activities and the operations being carried out currently on the drilling rig by other E&P companies, it is estimated that the well will spud during August 2025. The current PSC year 3 expires on 18 June 2025 and therefore an extension will be applied for shortly.
Good progress was also made in 2024 with respect to evaluating potential gas development and export scenarios for Chuditch. Discussions were held with various parties, culminating in the signature of a Memorandum of Understanding ("MOU") on 12 December 2024 with MPRM and TIMOR GAP. The MOU set out the framework for joint evaluation of a development concept for gas resources on the Chuditch PSC, including pipeline export to the Bayu Undan field and on to planned LNG facilities on the south coast of Timor-Leste. Subsequent to the reporting period, an engineering Feasibility Study was commissioned from selected third party engineering consultants for the future development of Chuditch and a pipeline to Bayu Undan. This work is intended as a springboard for the Chuditch joint venture to move forward quickly with development plans following the completion of the Chuditch-2 appraisal well.
It is worthwhile to note other activity in the E&P sector in Timor-Leste, which continues to see an uptick in interest and activity. Through 2024, the parties to the Greater Sunrise joint venture along with the governments of Timor-Leste and Australia commissioned a study carried out by Wood Group Plc to evaluate the respective commercial, technical and economic merits of taking gas from Sunrise to either Darwin in Australia or the south coast of Timor-Leste. The results of this eagerly awaited report were delivered to the parties in late 2024, but as of now have not been publicly disclosed. Finder Energy Holdings Ltd, an Australian E&P company entered Timor-Leste through its acquisition of Eni S.p.A. and INPEX Corporation interests in a PSC containing the Kuda Tasi and Jahal oil discoveries, which it intends to put onto a fast-track development path. Adjacent to the Chuditch PSC, Eni have been planning to acquire 3D seismic data, which we understand will now probably occur in Q3 2025. Onshore, Timor Resources Pty Ltd are preparing for appraisal drilling following their discoveries in 2022-23 and TIMOR GAP E.P. commenced acquiring 2D seismic data on the Pualaca PSC. All of these other industry activities are supportive of the development of the energy sector in Timor-Leste, and Sunda is proud to be at the forefront of this development.
United Kingdom Offshore Licence P2478 (relinquished 31 March 2024)
On 31 March 2024, offshore UK Licence P2478 was surrendered to the UK North Sea Transition Authority ("NSTA"), following delays to the acquisition of 3D seismic data that had been stipulated in the terms of an extension to Phase A of the licence. The delays largely resulted from the continuous wind farm construction activities in the area. The Company had held a 32% non-operated interest in the licence. All of Sunda's commitments on the licence had been fulfilled and a relinquishment report was submitted.
Peru
In April 2022, the Company requested the relinquishment of Licence Block XXI in Peru, a legacy asset dating from an earlier, Latin-America focused strategy. Licence Block XXI had been largely under Force Majeure for a variety of reasons since 2017. Sunda continues to own a Peruvian subsidiary, Gold Oil Peru S.A.C., and is working with local legal counsel regarding steps to complete its exit from Peru.
New Ventures
Following its pivot to Southeast Asia, Sunda has adopted a New Venture strategy focused on the region. The Company is seeking to identify and evaluate business growth opportunities that build a portfolio of opportunities, to diversify its asset base and create further shareholder value. The development of a New Venture strategy had been identified by the Board of Directors as a short-term priority and included in Sunda's KPIs for 2024 and 2025.
The Company has a focused approach to new business, shepherding limited resources in capital and personnel, whilst leveraging its competitive advantages in Southeast Asia. These include an experienced team that has extensive regional knowledge and is reputed for its high technical and operating standards, and the Company's strong relationships with governments and industry peers. Sunda sees quality opportunities of scale across the region and is focused on target asset types that can be categorised as follows:
· Large, low-risk "Chuditch-type" gas exploration and appraisal assets, which have been significantly de-risked by earlier industry activities
· Infrastructure or market-led opportunities, typically onshore or in shallow waters, where resources sizes may be smaller, but with material value and shorter timelines to monetisation
· Production assets that are identified as accessible and value-additive
It is in the context of the first of these themes that the Company announced on 28 August 2024 that it had applied for two Petroleum Service Contracts for offshore licence areas in the 1st Conventional Energy Bid Round of the Bangsamoro Autonomous Region of Muslim Mindanao ("BARMM") in the Philippines. The two blocks sit in an area that the Sunda team knows well and where there is potential for vast energy resources. The applications were made on a non-operated basis in a joint venture partnership with three others, including two Philippines E&P companies. Under the joint venture agreement, Sunda will have a 37.5% interest in these blocks, which contain material gas discoveries that point to significant upside potential.
As of the date of this report, the Company has not received news from the Philippines authorities regarding the award of the Service Contracts, although it is confirmed that the bids made have been fully evaluated and endorsed, and are now with the office of the President of the Philippines for final approval and signature. Further updates on these high potential blocks will be announced once confirmation of award is received.
Other New Business opportunities are being actively pursued in line with the strategy described above.
Corporate and Social Responsibility
Following the changes undertaken by the Company during 2024, and with its ambitions to become an important regional player in SE Asia, Sunda is putting increased efforts into a meaningful CSR programme in the areas where we operate, currently Timor-Leste.
As part of our in-country Timor-Leste activities, the Company undertakes various initiatives to develop the capabilities of the Timorese geological community, through relationships with local universities and professional organisations. During 2024, we welcomed a number of student interns and sponsored a student through a scheme run by the Timor-Leste Student Chapter of the Society of Petroleum Engineers ("SPE"). The Company also sponsored and gave presentations to the new full Timor Leste SPE Chapter and to university law students on the energy industry and an event jointly coordinated with the Association of International Energy Negotiators.
During 2024, the Company instigated discussions with the Ministry of Education to seek ways to contribute to educational assistance for the community in Dili where our local office and team are located. As a result of these discussions, it was decided to assist with the renovation of pre-school / kindergarten facilities. A number of schools were visited, and a pre-school in Manleuana on the south side of Dili was selected. On review, it was decided that the facilities at this pre-school were in such poor condition that it would be better to demolish and construct anew. A contract was therefore awarded in January 2025 and the new pre-school buildings are scheduled to be officially opened in June 2025.
Corporate update
On 29 February 2024, the Company completed a Placing, Subscription and WRAP Retail Offer of new ordinary shares at 0.05p to raise £3.26 million (gross). The monies were deployed in support of drilling preparations on the Chuditch PSC (Timor-Leste).
On 15 March 2024, Andy Butler, previously Director Asia-Pacific, took on the role of Chief Executive replacing Andy Yeo, who left the Company on 1 April 2024. On 22 April 2024, John Wakefield stepped down as Non-Executive Chairman and I was appointed in his place. In addition, on that date, it was announced that Dr John Chessher had been appointed as an Independent Non-executive Director and Rob Collins had been appointed as non-Board Chief Financial Officer. On 30 April 2024, Jon Ford stepped down from the Board, although he has been retained by the Company in a part-time consultancy role. Later, on 12 August 2024, it was announced that Rob Collins had been appointed to the Board.
Following the changes to the Board, the Company instigated a review of its governance structure. The company has joined the Quoted Companies Alliance and adopted its updated Guidelines published in 2023, as outlined in the Corporate Governance section of this report. The Terms of Reference of the board committees have been revisited and a new Health, Safety and Environment ("HSE") Committee established.
Conclusions
2024 was a year of tremendous change for the Company. With significant changes to the Board, management and direction, it made sense to change the name. Sunda Energy Plc is now a company truly focused on SE Asia, and in particular gas projects in that region. The Company has built on its exciting and valuable asset in Timor-Leste, putting together a highly experienced operating team and evaluating a pipeline of material new venture opportunities across the region.
I am pleased to report the significant progress in preparations towards the drilling of an appraisal well on the Chuditch field. We look forward with great excitement to the drilling of that well, the first to be operated by the Company and a critical milestone in realising the considerable and potentially transformative value of Chuditch for the Company and its shareholders. In addition, I look forward to the award of our applications in the Philippines and further expanding the Company's portfolio of material gas assets in Southeast Asia.
Note of Appreciation
I extend my thanks to all stakeholders of the Company, including my fellow directors, our dedicated and hard-working employees and consultants, and our Timorese joint venture and government partners, for their strong support of the Company's efforts. In these uncertain times, we are especially grateful for the support of our investors, who have patiently followed our progress towards the key Company milestone of our first operated well, the highly material Chuditch-appraisal. As we move forward, the Company remains firmly committed to striving for operational excellence and pursuing strategic opportunities that will drive long term success.
CONSOLIDATED INCOME STATEMENT FOR THE YEAR ENDED 31 DECEMBER 2024
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|
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|
|
|
|
|
|
|
|
|
|
|
Notes |
2024 |
2023 |
|
|
|
|
|
£'000 |
£'000 |
|
|
|
|
|
|
|
|
Revenue |
|
|
|
- |
- |
|
|
|
|
|
|
|
|
Cost of sales |
|
|
|
- |
- |
|
|
|
|
|
|
|
|
Gross profit |
|
|
|
- |
- |
|
|
|
|
|
|
|
|
Exploration and evaluation expenditure |
|
|
3 |
(170) |
(121) |
|
Intangible asset impairment |
|
|
9 |
- |
(187) |
|
Property, plant and equipment depreciation |
|
9 |
(37) |
(37) |
|
|
Peru closure costs |
|
|
|
(6) |
(26) |
|
Administration expenses |
|
|
3 |
(2,222) |
(1,455) |
|
Recovery of historic costs on farm-out |
|
|
|
221 |
- |
|
Gain/(loss) on exchange |
|
|
3 |
15 |
(32) |
|
|
|
|
|
|
|
|
Operating loss |
|
|
3 |
(2,199) |
(1,858) |
|
|
|
|
|
|
|
|
Finance cost |
|
|
6 |
(2) |
(6) |
|
Finance income |
|
|
6 |
152 |
152 |
|
|
|
|
|
|
|
|
Loss on ordinary activities |
|
|
|
|
|
|
before taxation |
|
|
|
(2,049) |
(1,712) |
|
|
|
|
|
|
|
|
Income tax expense |
|
|
7 |
- |
- |
|
|
|
|
|
|
|
|
Loss for the year |
|
|
|
(2,049) |
(1,712) |
|
|
|
|
|
|
|
|
Loss on ordinary activities |
|
|
|
|
|
|
after taxation is attributable to: |
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|
|
|
|
|
Equity shareholders |
|
|
|
(2,049) |
(1,712) |
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|
|
|
|
|
|
|
|
|
|
|
(2,049) |
(1,712) |
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|
|
|
|
|
|
|
Earnings per ordinary share - continuing |
|
|
8 |
|
|
|
Basic |
|
|
|
(0.008p) |
(0.009p) |
|
Diluted |
|
|
|
(0.008p) |
(0.009p) |
|
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME |
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for the year ended 31 December 2024 |
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|
|
|
|
|
|
|
|
2024 |
2023 |
|
|
|
|
|
£'000 |
£'000 |
|
|
|
|
|
|
|
|
Loss on ordinary activities after taxation attributable to the parent |
|
|
(2,049) |
(1,712) |
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|
|
|
|
|
|
|
|
Other comprehensive income: items which may subsequently be reclassified to profit and loss |
|
|
|
||
|
Exchange difference on translating foreign operations |
|
|
80 |
(172) |
|
|
|
|
|
|
|
|
|
Total comprehensive loss for the year |
|
|
|
(1,969) |
(1,884) |
|
|
|
|
|
|
|
|
Total comprehensive loss attributable to |
|
|
|
|
|
|
Owners of the parent |
|
|
|
(1,969) |
(1,884) |
|
|
|
|
|
|
|
|
CONSOLIDATED STATEMENT OF FINANCIAL POSITION |
|
||||
|
at 31 December 2024 |
|
|
|
||
|
|
|
|
Notes |
2024 |
2023 |
|
|
|
|
|
£'000 |
£'000 |
|
Assets |
|
|
|
|
|
|
Non current assets |
|
|
|
|
|
|
Property plant and equipment |
|
9 |
28 |
41 |
|
|
Intangible fixed assets |
|
|
10 |
5,059 |
3,781 |
|
|
|
|
|
|
|
|
|
|
|
|
5,087 |
3,822 |
|
|
|
|
|
|
|
|
Current assets |
|
|
|
|
|
|
Trade and other receivables |
|
|
12 |
86 |
91 |
|
Performance bond guarantee deposit |
|
13 |
1,596 |
786 |
|
|
Cash and cash equivalents |
|
|
14 |
3,171 |
3,760 |
|
|
|
|
|
|
|
|
|
|
|
|
4,853 |
4,637 |
|
|
|
|
|
|
|
|
Total assets |
|
|
|
9,940 |
8,459 |
|
|
|
|
|
|
|
|
Equity and liabilities |
|
|
|
|
|
|
Capital and reserves attributable to owners of the parent |
|
|
|
||
|
Share capital |
|
|
17 |
6,378 |
4,746 |
|
Share premium account |
|
|
18 |
40,242 |
38,881 |
|
Share option reserve |
|
|
18 |
338 |
319 |
|
Foreign exchange translation reserve |
|
|
18 |
795 |
715 |
|
Retained earnings |
|
|
18 |
(38,434) |
(36,406) |
|
|
|
|
|
|
|
|
Total equity |
|
|
|
9,319 |
8,255 |
|
|
|
|
|
|
|
|
Current liabilities |
|
|
|
|
|
|
Trade and other payables |
|
|
15 |
597 |
185 |
|
Taxes payable |
|
|
15 |
16 |
15 |
|
|
|
|
|
|
|
|
|
|
|
|
613 |
200 |
|
|
|
|
|
|
|
|
Non-current liabilities |
|
|
|
|
|
|
Lease finance |
|
|
15/16 |
8 |
4 |
|
|
|
|
|
|
|
|
Total equity and liabilities |
|
|
|
9,940 |
8,459 |
|
|
|
|
|
|
|
|
The financial statements were approved and authorised for issue by the Board of Directors on 30 May 2025 and were signed on its behalf by: |
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Director |
|
|
Director |
|
|
|
G Aherne |
|
|
A Butler |
|
|
|
|
|
|
|
|
|
|
Company number: 05098776 |
|
|
|
|
|
|
COMPANY STATEMENT OF FINANCIAL POSITION |
|||||
|
at 31 December 2024 |
|||||
|
|
|
|
Notes |
2024 |
2023 |
|
|
|
|
|
£'000 |
£'000 |
|
Assets |
|
|
|
|
|
|
Non current assets |
|
|
|
|
|
|
Property plant and equipment |
|
9 |
19 |
9 |
|
|
Intangible fixed assets |
|
|
10 |
- |
- |
|
Investments |
|
|
11 |
8,878 |
5,865 |
|
|
|
|
|
|
|
|
|
|
|
|
8,897 |
5,874 |
|
Current assets |
|
|
|
|
|
|
Trade and other receivables |
|
|
12 |
58 |
56 |
|
Cash and cash equivalents |
|
|
14 |
2,379 |
3,652 |
|
|
|
|
|
|
|
|
|
|
|
|
2,437 |
3,708 |
|
|
|
|
|
|
|
|
Total assets |
|
|
|
11,334 |
9,582 |
|
|
|
|
|
|
|
|
Equity and liabilities |
|
|
|
|
|
|
Capital and reserves attributable to owners of the parent |
|
|
|
||
|
Share capital |
|
|
17 |
6,378 |
4,746 |
|
Share premium account |
|
|
18 |
40,242 |
38,881 |
|
Share option reserve |
|
|
18 |
338 |
319 |
|
Retained earnings |
|
|
18 |
(35,731) |
(34,479) |
|
|
|
|
|
|
|
|
Total equity |
|
|
|
11,227 |
9,467 |
|
|
|
|
|
|
|
|
Current liabilities |
|
|
|
|
|
|
Trade and other payables |
|
|
15 |
83 |
100 |
|
Taxes payable |
|
|
15 |
16 |
15 |
|
|
|
|
|
|
|
|
|
|
|
|
99 |
115 |
|
|
|
|
|
|
|
|
Non-current liabilities |
|
|
|
|
|
|
Lease finance |
|
|
15/16 |
8 |
- |
|
|
|
|
|
|
|
|
Total equity and liabilities |
|
|
|
11,334 |
9,582 |
|
|
|
|
|
|
|
|
As permitted by section 408 of the Companies Act 2006, the Company's income statement has not been included in these financial statements. The loss of the Company for the year was £1,273,000 (2023: loss of £1,244,000). |
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The financial statements were approved and authorised for issue by the Board of Directors on 30 May 2025 and were signed on its behalf by: |
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Director |
|
|
Director |
|
|
|
|
|
|
|
|
|
|
Company number: 05098776 |
|
|
|
|
|
|
CONSOLIDATED AND COMPANY STATEMENT OF CHANGES IN EQUITY |
|
|||||
|
for the year ended 31 December 2024 |
|
|
|
|
|
|
|
|
Share |
Share |
Retained |
Share option |
Foreign exchange |
Total |
|
|
capital |
premium |
earnings |
reserve |
translation |
equity |
|
Group |
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
|
As at 1 January 2023 |
4,730 |
38,846 |
(34,707) |
332 |
887 |
10,088 |
|
|
|
|
|
|
|
|
|
Shares issued |
16 |
35 |
- |
- |
- |
51 |
|
Transactions with owners |
16 |
35 |
- |
- |
- |
51 |
|
Loss for the year attributable to equity shareholders |
- |
- |
(1,712) |
- |
- |
(1,712) |
|
Share option reserve released |
- |
- |
13 |
(13) |
- |
- |
|
Foreign exchange translation adjustments |
- |
. |
- |
- |
(172) |
(172) |
|
Total comprehensive income for the period |
- |
- |
(1,699) |
(13) |
(172) |
(1,884) |
|
As at 1 January 2024 |
4,746 |
38,881 |
(36,406) |
319 |
715 |
8,255 |
|
|
|
|
|
|
|
|
|
Issue of new shares |
1,632 |
1,632 |
- |
- |
- |
3,264 |
|
Share issue costs |
- |
(271) |
- |
- |
- |
(271) |
|
Transactions with owners |
1,632 |
1,361 |
- |
- |
- |
2,993 |
|
Loss for the year attributable to equity shareholders |
- |
- |
(2,049) |
- |
- |
(2,049) |
|
Share based payments |
- |
- |
- |
40 |
- |
40 |
|
Share option reserve released |
- |
- |
21 |
(21) |
- |
- |
|
Foreign exchange translation adjustments |
- |
- |
- |
- |
80 |
80 |
|
Total comprehensive income for the period |
- |
- |
(2,028) |
19 |
80 |
(1,929) |
|
|
|
|
|
|
|
|
|
As at 31 December 2024 |
6,378 |
40,242 |
(38,434) |
338 |
795 |
9,319 |
|
|
|
|
|
|
|
|
|
CONSOLIDATED AND COMPANY STATEMENT OF CHANGES IN EQUITY |
||||||
|
for the year ended 31 December 2024 (continued) |
||||||
|
|
|
|
|
|
|
|
|
|
|
Share |
Share |
Retained |
Share option |
Total |
|
|
|
capital |
premium |
earnings |
reserve |
equity |
|
|
|
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
|
Company |
|
|
|
|
|
|
|
As at 1 January 2023 |
|
4,730 |
38,846 |
(33,248) |
332 |
10,660 |
|
Shares issued |
|
16 |
35 |
- |
|
51 |
|
Transactions with owners |
|
16 |
35 |
- |
- |
51 |
|
|
|
|
|
|
|
|
|
Loss for the year |
|
- |
- |
(1,244) |
- |
(1,244) |
|
Share option reserve released |
|
- |
- |
13 |
(13) |
- |
|
Total comprehensive income for the period |
|
- |
- |
(1,231) |
(13) |
(1,244) |
|
|
|
|
|
|
|
|
|
As at 1 January 2024 |
|
4,746 |
38,881 |
(34,479) |
319 |
9,467 |
|
|
|
|
|
|
|
|
|
Issue of new shares |
|
1,632 |
1,632 |
- |
- |
3,264 |
|
Share issue costs |
|
- |
(271) |
- |
- |
(271) |
|
Transactions with owners |
|
1,632 |
1,361 |
- |
- |
2,993 |
|
Loss for the year |
|
- |
- |
(1,273) |
- |
(1,273) |
|
Share based payments |
|
- |
- |
- |
40 |
40 |
|
Share option reserve released |
|
- |
- |
21 |
(21) |
- |
|
Total comprehensive income for the period |
|
- |
- |
(1,252) |
19 |
(1,233) |
|
|
|
|
|
|
|
|
|
As at 31 December 2024 |
|
6,378 |
40,242 |
(35,731) |
338 |
11,227 |
|
|
|
|
|
|
|
|
|
Share capital is the amount subscribed for shares at nominal value. |
||||||
|
Share premium represents the excess of the amount subscribed for share capital over the nominal value of those shares net of share issue expenses. |
||||||
|
Retained earnings represents the cumulative loss of the Group attributable to equity shareholders. |
||||||
|
Foreign exchange translation occurs on consolidation of the translation of the subsidiaries balance sheets at the closing rate of exchange and their income statements at the average rate. |
||||||
|
CONSOLIDATED AND COMPANY STATEMENT OF CASH FLOWS |
|
||||
|
for the year ended 31 December 2024 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Group |
Company |
Group |
Company |
|
|
|
2024 |
2024 |
2023 |
2023 |
|
|
|
£'000 |
£'000 |
£'000 |
£'000 |
|
|
|
|
|
|
|
|
Operating activities |
|
(1,677) |
(1,497) |
(1,830) |
(1,084) |
|
|
|
|
|
|
|
|
Investing activities |
|
|
|
|
|
|
Return from investment and servicing of finance |
152 |
149 |
152 |
149 |
|
|
Advances to subsidiary and associated undertakings |
- |
(2,905) |
- |
(1,050) |
|
|
Performance bond guarantee deposit repaid |
792 |
- |
- |
- |
|
|
Performance bond guarantee deposit paid out |
(1,569) |
- |
- |
- |
|
|
Additions to exploration and evaluation assets |
(1,738) |
- |
(381) |
(28) |
|
|
Part disposal of exploration and evaluation asset |
498 |
- |
- |
- |
|
|
Acquisition of tangible assets |
(9) |
(5) |
(2) |
- |
|
|
Disposal of tangible assets |
|
2 |
2 |
- |
- |
|
|
|
|
|
|
|
|
|
|
(1,872) |
(2,759) |
(231) |
(929) |
|
|
|
|
|
|
|
|
Financing activities |
|
|
|
|
|
|
Net proceeds from issue of share capital |
2,993 |
2,993 |
51 |
51 |
|
|
Lease financing |
(33) |
(10) |
(37) |
(11) |
|
|
|
|
2,960 |
2,983 |
14 |
40 |
|
|
|
|
|
|
|
|
Net cash outflow |
|
(589) |
(1,273) |
(2,047) |
(1,973) |
|
|
|
|
|
|
|
|
Cash and cash equivalents at the beginning of the year |
3,760 |
3,652 |
5,807 |
5,625 |
|
|
|
|
|
|
|
|
|
Cash and cash equivalents at the end of the year |
3,171 |
2,379 |
3,760 |
3,652 |
|
|
|
|
|
|
|
|
|
CONSOLIDATED AND COMPANY STATEMENT OF CASH FLOWS |
|
||||
|
for the year ended 31 December 2024 (continued) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Note to the Consolidated and Company Statement of Cash Flow |
|
|
|
||
|
|
|
|
|
|
|
|
|
|
Group |
Company |
Group |
Company |
|
|
|
2024 |
2024 |
2023 |
2023 |
|
|
|
£'000 |
£'000 |
£'000 |
£'000 |
|
Operating activities |
|
|
|
|
|
|
Loss for the year attributable to controlling interests |
|
(2,049) |
(1,273) |
(1,712) |
(1,244) |
|
Depreciation, amortisation and impairment charges |
37 |
25 |
224 |
161 |
|
|
Share based payments |
|
40 |
40 |
- |
- |
|
Finance income shown as an investing activity |
(152) |
(149) |
(152) |
(149) |
|
|
Interest on lease liability |
2 |
1 |
6 |
1 |
|
|
Foreign exchange translation |
|
9 |
(116) |
(20) |
225 |
|
|
|
|
|
|
|
|
Operating cash outflows before movements in working capital |
(2,113) |
(1,472) |
(1,654) |
(1,006) |
|
|
|
|
|
|
|
|
|
Decrease/(increase) in receivables |
5 |
(2) |
10 |
5 |
|
|
Increase/(decrease) in payables |
431 |
(16) |
(186) |
(83) |
|
|
|
|
|
|
|
|
|
Net cash outflows from operating activities |
(1,677) |
(1,490) |
(1,830) |
(1,084) |
|
|
|
|
|
|
|
|
NOTES TO THE FINANCIAL STATEMENTS
General Information
Sunda Energy Plc is a public limited company incorporated in England and Wales and quoted on the AIM market of the London Stock Exchange. The address of the registered office is disclosed on page 2 of the financial statements. The principal activity of the Group is described in the Strategic Report on page 9.
(1) Significant accounting policies
The principal accounting policies applied in the preparation of these consolidated financial statements are set out below. These policies have been consistently applied to all the periods presented, unless otherwise stated.
Going concern basis
The Directors have prepared a cash flow forecast covering the period to 30 June 2026 which contains certain assumptions about the development and strategy of the business. The Directors are aware of the risks and uncertainties facing the business and the assumptions used are the Directors' best estimate of its future development.
The Group intends to enter into a rig contract shortly to drill the Chuditch-2 appraisal well as part of the work program for Year 3 of the PSC. It is anticipated that the well will spud in August 2025. In order to finance the Chuditch-2 well the Group has, subject to the completion of certain conditions precedent including the execution of a rig contract, farmed out an additional 30% interest in the PSC to Timor Gap and has secured a US$9 million unsecured convertible loan note ("CLN") of which US$1.5m has been drawn and converted into equity. The CLN contains draw down restrictions, including minimum market capitalisation of the Company and minimum trading volume. In the event that these restrictions take effect, the investors and the Company may mutually agree to waive the restriction. Furthermore, the CLN allows for the acceleration of the drawdown of the loan amounts. However, there is no guarantee that the investors will consent in either of these cases.
The cash flow forecast has been prepared on certain assumptions, the most significant of which are the full drawdown of the CLN, the acceleration of the drawdown schedule, the partial exercise of warrants associated with the CLN, and the expected recovery of the performance guarantee bond on or before the completion of the drill program. On the basis of the assumptions made in the cash flow forecast, the Group will have sufficient funds to pay its share of drilling costs as well as operational overheads of the Group for the period to 30 June 2026.
There is a possibility that well costs may increase significantly above the forecast spend and the Group may need to seek additional funding to cover its share of these costs. In order to mitigate this risk the Board have carefully budgeted and procured key contracts associated with the drilling campaign. Further to discussions with the Company's broker and certain investors, the Directors are confident of their ability to raise additional funds through new placing of shares or through other means, however there is no certainty that such fundraising will be successful. Similarly, if certain assumptions made in the forecast are not achieved then additional funds may be required. The Directors are confident that any cash shortfall can be met through the actions described above.
These conditions indicate that there is a material uncertainty which may cast significant doubt over the Group and Company's ability to continue as a going concern.
After considering the forecasts and the risks, the Directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future. For these reasons, they continue to adopt the going concern basis of accounting in preparing the annual financial statements. The financial statements do not include any adjustments that would result if the Group was unable to continue as a going concern.
Basis of preparation
The financial statements have been prepared in accordance with UK adopted International Accounting Standards and IFRIC interpretations issued by the International Accounting Standards Board (IASB) and with those parts of the Companies Act 2006 applicable to companies reporting under IFRS. The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.
Changes in accounting policies and disclosures
Adoption of new and revised standards
a) The impact of new IFRSs adopted during the year
During the year the Group adopted the following IFRS amendments and standards which were effective for the first time in periods commencing on or after 1 January 2024:
- IAS 1 Presentation of Financial Statements (Amendments to Classification of Liabilities as Current or Non-current)
- IAS 1 Presentation of Financial Statements (Amendment to Non-current liabilities with covenants)
- IFRS 16 Leases (Amendment, Lease Liability in a Sale and Leaseback)
- Amendments to IAS 7 and IFRS 7 in respect of Supplier Finance Arrangements
None of the above were considered to have a material impact.
b) New standards, interpretations and amendments not yet effective
The following IFRSs and amendments have been issued by the IASB but are not effective until a future period, with timing expected to be as indicated.
- IAS 21 The Effects of Changes in Foreign Exchange Rates (Amendments) - Lack of exchangeability (1 January 2025)
- Amendments to the Classification and Measurement of Financial Instruments (Amendments to IFRS 9 Financial Instruments) (1 January 2026) *
- Annual Improvements to IFRS Volume 11 (Amendments to IFRS 1 First-Time Adoption of IFRS; IFRS 7 Financial Instruments Disclosures; IFRS 9 Financial Instruments; IFRS 10 Consolidated Financial Statements and IAS 7 Statement of Cash Flows) (1 January 2026) *
- IFRS 18 Presentation and Disclosure in Financial Statements (1 January 2027) *
- IFRS 19 Subsidiaries without Public Accountability: Disclosures (1 January 2027) *
*Not yet endorsed by the UK Endorsement Board.
The Board are currently assessing the impact of these new amendments on the Group's financial reporting for future periods. However, the Board does not expect any of the above to have a material impact on future reporting except for IFRS 18 which is expected to result in changes in the presentation of certain primary financial statements. A full assessment will be performed once the standard is adopted in the UK.
Basis of consolidation
The consolidated financial statements include the financial statements of the Company and its subsidiaries using the acquisition method of accounting.
Subsidiaries
Subsidiaries are all entities over which Sunda Energy Plc is exposed, or has rights to, variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee. The existence and effect of potential voting rights that are currently exercisable or convertible are considered when assessing whether the Group controls another entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Company. They are de-consolidated from the date that control ceases.
Inter-company transactions, balances and unrealised gains on transactions between Group companies are eliminated. Unrealised losses are also eliminated but considered an impairment indicator of the asset transferred. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the Group.
Impairment of non-financial assets
At each statement of financial position date, the Group reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where the asset does not generate cash flows that are independent from other assets, the Group estimates the recoverable amount of the cash-generating unit to which the asset belongs. An intangible asset with an indefinite useful life is tested for impairment annually and whenever there is an indication that the asset may be impaired.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised as an expense immediately, unless the relevant asset is carried at a re-valued amount, in which case the impairment loss is treated as a revaluation decrease.
Where an impairment loss subsequently reverses, the carrying amount of the asset (cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (cash-generating unit) in prior periods. A reversal of an impairment loss is recognised as income immediately, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
Intangible Assets
Oil and gas assets: exploration and evaluation
The Group has continued to apply the 'successful efforts' method of accounting for Exploration and Evaluation ("E&E") costs, having regard to the requirements of IFRS 6 'Exploration for the Evaluation of Mineral Resources'.
The successful efforts method means that only the costs which relate directly to the discovery and development of specific oil and gas reserves are capitalised. Such costs may include costs of licence acquisition, technical services and studies, seismic acquisition; exploration drilling and testing but do not include costs incurred prior to having obtained the legal rights to explore the area. Under successful efforts accounting, exploration expenditure which is general in nature is charged directly to the income statement and that which relates to unsuccessful drilling operations, though initially capitalised pending determination, is subsequently written off. Only costs which relate directly to the discovery and development of specific commercial oil and gas reserves will remain capitalised and to be depreciated over the lives of these reserves. The success or failure of each exploration effort will be judged on a well-by-well basis as each potentially hydrocarbon-bearing structure is identified and tested. Exploration and evaluation costs are capitalised within intangible assets. Costs incurred prior to obtaining legal rights to explore are expensed immediately to the income statement.
All lease and licence acquisition costs, geological and geophysical costs and other direct costs of exploration, evaluation and development are capitalised as intangible or property, plant and equipment according to their nature. Intangible assets comprise costs relating to the exploration and evaluation of properties which the Directors consider to be unevaluated until reserves are appraised as commercial, at which time they are transferred to tangible assets as 'Developed oil and gas assets' following an impairment review and depreciated accordingly. Where properties are appraised to have no commercial value, the associated costs are treated as an impairment loss in the period in which the determination is made.
Costs are amortised on a field by field unit of production method based on commercial proven and probable reserves, or to the expiry of the licence, whichever is earlier.
The calculation of the 'unit of production' amortisation takes account of the estimated future development costs and is based on the current period and un-escalated price levels. Changes in reserves and cost estimates are recognised prospectively.
E&E costs are not amortised prior to the conclusion of appraisal activities.
Accounting for farm-outs
During the period, the Group completed a farm-out transaction of its main exploration asset which resulted in the receipt of funds in respect of back costs, and also contributions to future costs by the farminee. The back costs received in respect of amounts previously capitalised as an exploration asset were credited to the carrying value of the asset on a no gain, no loss basis. Those back costs attributable to administration costs previously expensed are shown as a gain in the Income Statement. Post farm-out cost recoveries from the farminee is be offset against the relevant costs charged to the exploration asset and administration costs as appropriate.
Investments in subsidiaries
Investments are stated at cost less provision for any impairment in value.
Financial instruments
Non-derivative financial instruments comprise investments in equity and debt securities, trade and other receivables, cash and cash equivalents, loans and borrowings, and trade and other payables.
Non-derivative financial instruments are recognised initially at fair value plus, for instruments not at fair value through profit or loss, any directly attributable transactions costs, except as described below. Subsequent to initial recognition non-derivative financial instruments are measured as described below.
A financial instrument is recognised when the Group becomes a party to the contractual provisions of the instrument. Financial assets are derecognised if the Group's contractual rights to the cash flows from the financial assets expire or if the Group transfers the financial assets to another party without retaining control or substantially all risks and rewards of the asset. Regular purchases and sales of financial assets are accounted for at trade date, i.e. the date that the Group commits itself to purchase or sell the asset. Financial liabilities are derecognised if the Group's obligations specified in the contract expire or are discharged or cancelled.
Trade and other receivables
Trade receivables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method, less provision for impairment. A provision for impairment is established when there is objective evidence that the Group will not be able to collect all amounts due according to the original terms of the receivables. Significant financial difficulties of the debtor, probability that the debtor will enter bankruptcy or financial reorganisation, and default or delinquency in payments are considered indicators that the trade receivable is impaired.
Performance bond and bank guarantee deposits
From time to time, the Group provides performance guarantees in respect of contractual work commitments which are secured by bank guarantees backed by cash deposits. Unless the deposit funds are available for cash use within three months of the period end, they are not considered as a cash equivalent but are shown as a separate current asset.
Cash and cash equivalents
Cash and cash equivalents in the Statement of Cash Flows (see page 36) include cash in hand, deposits held on call with banks, other short-term highly liquid investments with original maturities of three months or less.
Taxation
Income tax
Income tax expense represents the sum of the tax currently payable and deferred tax.
The tax currently payable is based on taxable profit or loss for the year. Taxable profit or loss differs from profit or loss as reported in the same income statement because it excludes items of income or expense that are taxable or deductible in other periods and it further excludes items that are never taxable or deductible. The Company's liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the statement of financial position date.
Deferred tax
Deferred tax is recognised on differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit and is accounted for using the statement of financial position liability method. Deferred tax liabilities are generally recognised for all taxable temporary differences and deferred tax assets are recognised to the extent that it is probable that taxable profits will be available against which deductible temporary differences can be utilised. Such assets and liabilities are not recognised if the temporary difference arises from goodwill or from the initial recognition (other than in a business combination) of other assets and liabilities in a transaction that affects neither the taxable profit nor the accounting profit.
The carrying amount of deferred tax is reviewed at each statement of financial position date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.
Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset realised. Deferred tax is charged or credited to income statement, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and when they relate to income taxes levied by the same taxation authority and the Company intends to settle its current tax assets and liabilities on a net basis.
Trade and other payables
Trade payables are not interest bearing and are stated at their nominal value. Trade and other payables are initially recognised at fair value. They are subsequently measured at amortised cost using the effective interest method unless the effect of discounting would be immaterial, in which case they are stated at cost.
Fair values
The carrying amounts of the financial assets and liabilities such as cash and cash equivalents, receivables and payables of the Group at the statement of financial position date approximated their fair values, due to the relatively short term nature of these financial instruments.
Share-based compensation
The fair value of the employee and suppliers services received in exchange for the grant of the options is recognised as an expense. The total amount to be expensed over the vesting period is determined by reference to the fair value of the options granted, excluding the impact of any non-market vesting conditions (for example, profitability and sales growth targets). Non-market vesting conditions are included in assumptions about the number of options that are expected to vest. At each statement of financial position date, the entity revises its estimates of the number of options that are expected to vest. It recognises the impact of the revision to original estimates, if any, in the income statement, with a corresponding adjustment to equity.
The proceeds received net of any directly attributable transaction costs are credited to share capital (nominal value) and share premium when the options are exercised.
The fair value of share-based payments recognised in the income statement is measured by use of the Black Scholes model, which takes into account conditions attached to the vesting and exercise of the equity instruments. The expected life used in the model is adjusted based on management's best estimate, for the effects of non-transferability, exercise restrictions and behavioural considerations. The share price volatility percentage factor used in the calculation is based on management's best estimate of future share price behaviour and is selected based on past experience, future expectations and benchmarked against peer companies in the industry.
Equity instruments
Ordinary shares are classified as equity.
Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax, from proceeds.
Lease accounting
|
At the commencement date, the Group measures the lease liability at the present value of the lease payments unpaid at that date, discounted using the interest rate implicit in the lease if that rate is readily available or the Group's incremental borrowing rate.
|
|
Lease payments included in the measurement of the lease liability are made up of fixed payments (including in substance fixed), variable payments based on an index or rate, amounts expected to be payable under a residual value guarantee and payments arising from options reasonably certain to be exercised.
|
|
Subsequent to initial measurement, the liability will be reduced for payments made and increased for interest. It is remeasured to reflect any reassessment or modification, or if there are changes in in-substance fixed payments.
|
|
When the lease liability is remeasured, the corresponding adjustment is reflected in the right-of-use asset, or profit and loss if the right-of-use asset is already reduced to zero.
|
|
Interest payable and similar charges include interest payable, finance charges on shares classified as liabilities and finance leases recognised in profit or loss using the effective interest method, unwinding of the discount on provisions, and net foreign exchange losses that are recognised in the profit and loss account.
|
|
On the statement of financial position, lease liabilities have been included in current and non-current liabilities. |
Foreign currencies
i) Functional and presentation currency
Items included in the financial statements of the Group are measured using the currency of the primary economic environment in which the entity operates (the functional currency), which is Pounds Sterling (£). The financial statements are presented in Pounds Sterling (£), which is the Group's presentation currency.
ii) Transactions and balances
Foreign currency transactions are translated into the presentational currency using exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the income statement.
iii) Group companies
The results and financial position of all Group entities (none of which has the currency of a hyper-inflationary economy) that have a functional currency different from the presentation currency are translated into the presentation currency as follows:
(a) assets and liabilities for each statement of financial position presented are translated at the closing rate at the date of that statement of financial position;
(b) income and expenses for each income statement are translated at average exchange rates (unless this average is not a reasonable approximation of the cumulative effect of the rates prevailing on the transaction dates, in which case income and expenses are translated at the rate on the dates of the transactions); and
(c) all resulting exchange differences are recognised as a separate component of equity.
On consolidation, exchange differences arising from the translation of the net investment in foreign operations, and of borrowings and other currency instruments designated as hedges of such investments, are taken to shareholders' equity. When a foreign operation is partially disposed of or sold, exchange differences that were recorded in equity are recognised in the income statement as part of the gain or loss on sale.
Management of capital
The Group's policy is to ensure that it will always have sufficient cash to allow it to meet its liabilities when they become due. To achieve this aim, it seeks to raise new equity finance and debt sufficient to meet the next phase of exploration and where relevant development expenditure.
The Board receives cash flow projections on a regular basis as well as information on cash balances. The Board will not commit to material expenditure in respect of its ongoing appraisal work prior to being satisfied that sufficient funding is available to the Group to finance the planned programmes.
Dividends cannot be issued until there are sufficient reserves available.
Critical accounting judgements and key sources of estimation uncertainty
The preparation of the consolidated financial statements requires management to make estimates and assumptions concerning the future that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenues and expenses during the reporting periods. The resulting accounting estimates will, by definition, differ from the related actual results.
Carrying value of intangible exploration and evaluation assets
Valuation of oil and gas properties: judgements regarding timing of regulatory approval, the general economic environment, and the ability to finance future activities has an impact on the impairment analysis of intangible exploration and evaluation assets. All these factors may impact the viability of future commercial production from unproved properties, and therefore may be a need to recognise an impairment. The timing of an impairment review and the judgement of when there could be a significant change affecting the carrying value of the intangible exploration and evaluation asset is a critical accounting judgement in itself.
The Board also assesses potential impairment of the Company's net investment in subsidiaries by reference to the same judgements around the circumstances of the Group's oil and gas exploration projects. At year end the Group's exploration assets which the board reviewed for impairment were carried at £5.1m and the Company's net investment in subsidiaries was held at £5.0m. Further details are given in Notes 10 and 11 respectively.
Commercial reserves estimates
Oil and gas reserve estimates: estimation of recoverable reserves include assumptions regarding commodity prices, exchange rates, discount rates, production and transportation costs all of which impact future cashflows. It also requires the interpretation of complex geological and geophysical models in order to make an assessment of the size, shape, depth and quality of reservoirs and their anticipated recoveries. The economic, geological and technical factors used to estimate reserves may change from period to period. Changes in estimated reserves can impact developed and undeveloped property carrying values, asset retirement costs and the recognition of income tax assets, due to changes in expected future cash flows.
|
2. Segmental information |
|
|
|
|
|
|
In the opinion of the Directors the Group has one class of business, being the exploration for, and development and production of, oil and gas reserves, and other related activities. |
|||||
|
|
|
|
|
|
|
|
The Group's primary reporting format is determined to be the geographical segment according to the location of the oil and gas asset. There are currently three geographic reporting segments: South East Asia where production, development and exploration activity is being assessed, South America, which has previously been involved in production, development and exploration activity but is now being phased out, and the United Kingdom being the head office location. |
|||||
|
|
|
|
|
|
|
|
Exploration and production year ended 31 December 2024 |
|
||||
|
|
|
United |
South |
South East |
|
|
|
|
Kingdom |
America |
Asia |
Total |
|
|
|
£'000 |
£'000 |
£'000 |
£'000 |
|
Revenue |
|
- |
- |
- |
- |
|
Cost of sales |
|
- |
- |
- |
- |
|
|
|
|
|
|
|
|
Gross profit |
|
- |
- |
- |
- |
|
|
|
|
|
|
|
|
Exploration and evaluation expenditure |
(45) |
- |
(125) |
(170) |
|
|
Property, plant and equipment and depreciation |
(10) |
- |
(27) |
(37) |
|
|
Peru closure costs |
|
- |
(6) |
- |
(6) |
|
Recovery of historic costs on farm-out |
- |
- |
221 |
221 |
|
|
Administration expenses |
|
(1,476) |
(3) |
(743) |
(2,222) |
|
Gain on exchange |
|
17 |
- |
(2) |
15 |
|
|
|
|
|
|
|
|
Loss before interest and taxation |
|
(1,514) |
(9) |
(676) |
(2,199) |
|
|
|
|
|
|
|
|
Finance cost |
|
(1) |
- |
(1) |
(2) |
|
Finance income |
|
149 |
3 |
- |
152 |
|
|
|
|
|
|
|
|
Loss before taxation |
|
(1,366) |
(6) |
(677) |
(2,049) |
|
Income tax expense |
|
- |
- |
- |
- |
|
|
|
|
|
|
|
|
Loss after taxation |
|
(1,366) |
(6) |
(677) |
(2,049) |
|
|
|
|
|
|
|
|
Assets and liabilities |
|
|
|
|
|
|
Segment assets |
|
77 |
- |
6,692 |
6,769 |
|
Cash and cash equivalents |
|
2,379 |
- |
792 |
3,171 |
|
|
|
|
|
|
|
|
Total assets |
|
2,456 |
- |
7,484 |
9,940 |
|
|
|
|
|
|
|
|
Segment liabilities |
|
84 |
1 |
520 |
605 |
|
Current tax liabilities |
|
16 |
- |
- |
16 |
|
|
|
|
|
|
|
|
Total liabilities |
|
100 |
1 |
520 |
621 |
|
|
|
|
|
|
|
|
Other segment items |
|
|
|
|
|
|
Capital expenditure |
|
22 |
- |
1,742 |
1,764 |
|
Depreciation, amortisation and impairment charges |
|
10 |
- |
27 |
37 |
|
|
|
|
|
|
|
|
2. Segmental information (continued) |
|
|
|
|
|
|
Exploration and production year ended 31 December 2023 |
|
||||
|
|
|
United |
South |
South East |
|
|
|
|
Kingdom |
America |
Asia |
Total |
|
|
|
£'000 |
£'000 |
£'000 |
£'000 |
|
Revenue |
|
- |
- |
- |
- |
|
Cost of sales |
|
- |
- |
- |
- |
|
|
|
|
|
|
|
|
Gross profit |
|
- |
- |
- |
- |
|
|
|
|
|
|
|
|
Exploration and evaluation expenditure |
(75) |
- |
(46) |
(121) |
|
|
Intangible asset impairment |
(187) |
- |
- |
(187) |
|
|
Property, plant and equipment and depreciation |
(12) |
- |
(25) |
(37) |
|
|
Peru closure costs |
- |
(26) |
- |
(26) |
|
|
Administration expenses |
|
(878) |
(9) |
(568) |
(1,455) |
|
Loss on exchange |
|
(32) |
- |
- |
(32) |
|
|
|
|
|
|
|
|
Loss before interest and taxation |
|
(1,184) |
(35) |
(639) |
(1,858) |
|
|
|
|
|
|
|
|
Finance costs |
|
(1) |
- |
(5) |
(6) |
|
Finance income |
|
149 |
3 |
- |
152 |
|
|
|
|
|
|
|
|
Loss before taxation |
|
(1,036) |
(32) |
(644) |
(1,712) |
|
Income tax expense |
|
- |
- |
- |
- |
|
|
|
|
|
|
|
|
Loss after taxation |
|
(1,036) |
(32) |
(644) |
(1,712) |
|
|
|
|
|
|
|
|
Assets and liabilities |
|
|
|
|
|
|
Segment assets |
|
65 |
- |
4,634 |
4,699 |
|
Cash and cash equivalents |
|
3,652 |
1 |
107 |
3,760 |
|
|
|
|
|
|
|
|
Total assets |
|
3,717 |
1 |
4,741 |
8,459 |
|
|
|
|
|
|
|
|
Segment liabilities |
|
102 |
- |
87 |
189 |
|
Current tax liabilities |
|
15 |
- |
- |
15 |
|
|
|
|
|
|
|
|
Total liabilities |
|
117 |
- |
87 |
204 |
|
|
|
|
|
|
|
|
Other segment items |
|
|
|
|
|
|
Capital expenditure |
|
28 |
- |
355 |
383 |
|
Depreciation, amortisation and impairment charges |
|
199 |
- |
25 |
224 |
|
|
|
|
|
|
|
|
3. Operating loss |
|
|
|
2024 |
2023 |
|
|
|
|
|
£'000 |
£'000 |
|
The operating loss is stated after charging: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Auditor's remuneration |
|
|
|
|
|
|
Audit of group and company financial statements - current year |
|
|
38 |
30 |
|
|
Audit of group and company financial statements - prior year |
|
|
6 |
- |
|
|
Non-audit services: Tax compliance |
|
|
|
5 |
2 |
|
Non-audit services: Other assurance services |
|
|
5 |
2 |
|
|
Exploration and appraisal expenditure |
|
|
|
170 |
121 |
|
Impairment of intangible assets |
|
|
|
- |
187 |
|
Depreciation of property, plant and equipment |
|
|
37 |
37 |
|
|
(Gain)/loss on exchange |
|
|
|
(15) |
32 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The analysis of development and administrative expenses in the consolidated income statement by nature of expense is: |
|||||
|
|
|
|
|
2024 |
2023 |
|
|
|
|
|
£'000 |
£'000 |
|
Employee benefit expense |
|
|
|
1,001 |
764 |
|
Share based payments |
|
|
|
40 |
- |
|
Exploration and appraisal expenditure |
|
|
|
170 |
121 |
|
Depreciation, amortisation and impairment charges |
|
|
37 |
224 |
|
|
Legal and professional fees |
|
|
|
911 |
509 |
|
Recovery of historic costs on farm-out |
|
|
|
(221) |
- |
|
Peru closure costs |
|
|
|
6 |
26 |
|
Loss/(gain) on exchange |
|
|
|
(15) |
32 |
|
Other expenses |
|
|
|
270 |
182 |
|
|
|
|
|
|
|
|
|
|
|
|
2,199 |
1,858 |
|
4. Staff numbers and cost |
|
|
|
|
|
|
The average number of persons employed by the Group (including directors) during the year, analysed by category, were as follows: |
|||||
|
|
|
2024 |
2023 |
||
|
|
|
Group |
Company |
Group |
Company |
|
|
|
Number |
Number |
Number |
Number |
|
|
|
|
|
|
|
|
Directors |
|
5 |
5 |
4 |
4 |
|
Technical and production |
|
4 |
- |
4 |
- |
|
Administration |
|
3 |
1 |
2 |
1 |
|
Total |
|
12 |
6 |
10 |
5 |
|
|
|
|
|
|
|
|
The aggregate payroll costs of these persons were as follows: |
£'000 |
£'000 |
£'000 |
£'000 |
|
|
Wages and salaries |
|
327 |
61 |
221 |
54 |
|
Directors' fees, salaries and benefits |
297 |
297 |
483 |
483 |
|
|
Share based payments |
|
40 |
40 |
- |
- |
|
Severance payments |
|
299 |
299 |
- |
- |
|
Social security costs |
|
84 |
70 |
72 |
62 |
|
Total |
|
1,047 |
767 |
776 |
599 |
|
5. Directors' remuneration |
|
|
|
2024 |
2023 |
||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
£'000 |
£'000 |
||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||||||||||||||
|
Directors' remuneration |
|
|
|
297 |
483 |
||||||||||||||||||||||||||||||||||||||||||
|
Compensation for loss of office |
|
|
|
299 |
- |
||||||||||||||||||||||||||||||||||||||||||
|
Share based payments |
|
|
|
30 |
- |
||||||||||||||||||||||||||||||||||||||||||
|
Total |
|
|
|
626 |
483 |
||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||||||||||||||
|
Management fees paid to an entity in which a director is a shareholder are disclosed in note 24 on page 67. |
|||||||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||||||||||||||
|
No directors benefitted from pension contributions in 2024 or 2023. |
|||||||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||||||||||||||
|
Highest paid director emoluments and other benefits are as listed below. |
|||||||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
2024 |
2023 |
||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
£'000 |
£'000 |
||||||||||||||||||||||||||||||||||||||||||
|
Remuneration and benefits |
|
|
|
59 |
280 |
||||||||||||||||||||||||||||||||||||||||||
|
Compensation for loss of office |
|
|
|
278 |
- |
||||||||||||||||||||||||||||||||||||||||||
|
Total |
|
|
|
337 |
280 |
||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||||||||||||||
|
|||||||||||||||||||||||||||||||||||||||||||||||
|
6. Finance income and expenses |
|
|
|
2024 |
2023 |
|
|
|
|
|
£'000 |
£'000 |
|
Bank and other interest received |
|
|
|
152 |
152 |
|
Interest on right of use asset finance |
|
|
(2) |
(6) |
|
|
Total |
|
|
|
150 |
146 |
|
7. Income tax expense |
|
|
|
2024 |
2023 |
|
|
|
|
|
£'000 |
£'000 |
|
The tax charge on the loss on ordinary activities was:- |
|
|
|
|
|
|
|
|
|
|
|
|
|
UK Corporation Tax - current |
|
|
|
- |
- |
|
Foreign taxation |
|
|
|
- |
- |
|
|
|
|
|
|
|
|
|
|
|
|
- |
- |
|
|
|
|
|
|
|
|
The total charge for the year can be reconciled to the accounting result as follows: |
|
|
|||
|
|
|
|
|
2024 |
2023 |
|
|
|
|
|
£'000 |
£'000 |
|
(Loss) before tax |
|
|
|
|
|
|
Continuing operations |
|
|
|
(2,049) |
(1,712) |
|
|
|
|
|
|
|
|
Tax at composite group rate of 26.9% (2023: 27.9%) |
|
(552) |
(478) |
||
|
|
|
|
|
|
|
|
Effects of: |
|
|
|
|
|
|
Expenses not subject to tax |
|
|
|
44 |
127 |
|
Movement on capital allowances |
|
|
|
70 |
(91) |
|
Increase in tax losses |
|
|
|
438 |
442 |
|
|
|
|
|
|
|
|
Tax expense |
|
|
|
- |
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At 31 December 2024, the Group had estimated tax losses of £42,844,000 (2023 - £38,315,000) to carry forward against future profits. The potential deferred tax asset on these tax losses at a composite group rate of 29.5% of £12,626,000 (2023: at 29.6%, £11,329,000) has not been recognised due to uncertainty over the timing and existence of future taxable profits. The current tax reconciliation has been prepared using a blended rate of 26.9% (2023: 27.9%) based on prevailing headline taxation rates as applied to the group's taxable entities in the year. The rate assessed for the unrecognised deferred tax asset reflects management's best estimate of the applicable rates which would apply to oil and gas revenues in the group's respective countries of operation. |
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
8. Earnings per share |
|
|
|
|
|
|
|
|
|
|
2024 |
2023 |
|
Loss per ordinary share |
|
|
|
|
|
|
- Basic |
|
|
|
(0.008p) |
(0.009p) |
|
- Diluted |
|
|
|
(0.008p) |
(0.009p) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per ordinary share is based on the Group's loss attributable to owners of the parent for the year of £2,049,000 (2023: £1,712,000). |
|||||
|
The weighted average number of shares used in the calculation is the weighted average ordinary shares in issue during the year of 24,440,616,024 (2023: 18,973,685,086). |
|||||
|
|
|
|
|
|
|
|
Due to the Group's results, the diluted earnings per share was deemed to be the same as the basic earnings per share for that year. |
|||||
|
|
|
|
|
|
|
|
9. Property, plant and equipment |
|
|
|
|
|
|
|
|
|
Equipment and |
Right of use |
|
|
|
|
|
machinery |
assets |
Total |
|
|
|
|
£'000 |
£'000 |
£'000 |
|
Group |
|
|
|
|
|
|
Cost |
|
|
|
|
|
|
At 1 January 2023 |
|
|
18 |
107 |
125 |
|
Foreign exchange translation adjustment |
|
(1) |
(3) |
(4) |
|
|
Additions |
|
|
2 |
- |
2 |
|
|
|
|
|
|
|
|
At 1 January 2024 |
|
|
19 |
104 |
123 |
|
Foreign exchange translation adjustment |
|
- |
1 |
1 |
|
|
Additions |
|
|
9 |
17 |
26 |
|
Disposals |
|
|
(3) |
- |
(3) |
|
|
|
|
|
|
|
|
At 31 December 2024 |
|
|
25 |
122 |
147 |
|
|
|
|
|
|
|
|
Depreciation |
|
|
|
|
|
|
At 1 January 2023 |
|
|
5 |
42 |
47 |
|
Foreign exchange translation adjustment |
|
- |
(2) |
(2) |
|
|
Charge for the period |
|
|
6 |
31 |
37 |
|
|
|
|
|
|
|
|
At 1 January 2024 |
|
|
11 |
71 |
82 |
|
Foreign exchange translation adjustment |
|
- |
1 |
1 |
|
|
Charge for the period |
|
|
7 |
30 |
37 |
|
Disposals |
|
|
(1) |
- |
(1) |
|
|
|
|
|
|
|
|
At 31 December 2024 |
|
|
17 |
102 |
119 |
|
|
|
|
|
|
|
|
Net book value |
|
|
|
|
|
|
At 31 December 2024 |
|
|
8 |
20 |
28 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At 31 December 2023 |
|
|
8 |
33 |
41 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Included in the above line items are Right of Use assets of £20,000 (2023: £33,000) in respect of a motor vehicle and an office lease. |
|||||
|
Company |
|
|
|
|
|
|
Cost |
|
|
|
|
|
|
At 1 January and 31 December 2023 |
1 |
45 |
46 |
||
|
Additions |
|
|
5 |
17 |
22 |
|
Disposals |
|
|
(3) |
- |
(3) |
|
|
|
|
|
|
|
|
At 1 January 2023 |
|
3 |
62 |
65 |
|
|
|
|
|
|
|
|
|
Depreciation |
|
|
|
|
|
|
At 1 January 2023 |
|
|
- |
25 |
25 |
|
Charge for the period |
|
|
- |
12 |
12 |
|
|
|
|
|
|
|
|
At 1 January 2024 |
|
|
- |
37 |
37 |
|
Charge for the period |
|
|
1 |
9 |
10 |
|
Disposals |
|
|
(1) |
- |
(1) |
|
|
|
|
|
|
|
|
At 31 December 2024 |
|
|
- |
46 |
46 |
|
|
|
|
|
|
|
|
Net book value |
|
|
|
|
|
|
At 31 December 2024 |
|
|
3 |
16 |
19 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At 31 December 2023 |
|
|
1 |
8 |
9 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Included in the above line items are Right of Use assets of £16,000 (2023: £8,000) in respect of a motor vehicle. |
|||||
|
10. Intangible fixed assets |
|
|
|
Exploration |
|
||
|
|
|
|
|
and evaluation |
|
||
|
|
|
|
|
assets |
Total |
||
|
|
|
|
|
£'000 |
£'000 |
||
|
Group |
|
|
|
|
|
||
|
Cost |
|
|
|
|
|
||
|
At 1 January 2023 |
|
|
|
3,696 |
3,696 |
||
|
Foreign exchange translation adjustment |
|
|
(109) |
(109) |
|||
|
Additions |
|
|
|
381 |
381 |
||
|
At 1 January 2024 |
|
|
|
3,968 |
3,968 |
||
|
Foreign exchange translation adjustment |
|
|
38 |
38 |
|||
|
Additions |
|
|
|
1,738 |
1,738 |
||
|
Disposals |
|
|
|
(685) |
(685) |
||
|
At 31 December 2024 |
|
|
|
5,059 |
5,059 |
||
|
|
|
|
|
|
|
||
|
Impairment |
|
|
|
|
|
||
|
At 1 January 2023 |
|
|
|
- |
- |
||
|
Charge for the period |
|
|
|
187 |
187 |
||
|
At 1 January 2024 |
|
|
|
187 |
187 |
||
|
Charge for the period |
|
|
|
- |
187 |
||
|
Disposals |
|
|
|
(187) |
(187) |
||
|
At 31 December 2024 |
|
|
- |
374 |
|||
|
|
|
|
|
|
|
||
|
Net book value |
|
|
|
|
|
||
|
At 31 December 2024 |
|
|
|
5,059 |
4,685 |
||
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
||
|
At 31 December 2023 |
|
|
|
3,781 |
3,781 |
||
|
|
|
|
|
|
|
||
|
|
|
|
|
Exploration |
|
|
|
|
|
|
|
|
and evaluation |
|
|
|
|
|
|
|
|
assets |
Total |
|
|
|
|
|
|
|
£'000 |
£'000 |
|
|
|
Company |
|
|
|
|
|
|
|
|
Cost |
|
|
|
|
|
|
|
|
At 1 January 2023 |
|
|
|
159 |
159 |
|
|
|
Additions |
|
|
|
28 |
28 |
|
|
|
At 1 January 2024 |
|
|
|
187 |
187 |
|
|
|
Disposals |
|
|
|
(187) |
(187) |
|
|
|
At 31 December 2024 |
|
|
|
- |
- |
|
|
|
|
|
|
|
|
|
|
|
|
Impairment |
|
|
|
|
|
|
|
|
At 1 January 2023 |
|
|
|
- |
- |
|
|
|
Charge for the year |
|
|
|
187 |
187 |
|
|
|
At 1 January 2024 |
|
|
187 |
187 |
|
||
|
Disposals |
|
|
|
(187) |
(187) |
|
|
|
At 31 December 2024 |
|
|
|
- |
- |
|
|
|
|
|
|
|
|
|
|
|
|
Net book value |
|
|
|
|
|
|
|
|
At 31 December 2024 |
|
|
|
- |
- |
|
|
|
|
|
|
|
|
|
|
|
|
At 31 December 2023 |
|
|
|
- |
- |
|
|
|
|
|
|
|
|
|
|
|
|
Exploration and evaluation assets represent amounts capitalised in progressing the Group's interest in licences for the exploration of oil and gas in the UK and Timor-Leste. On 8 February 2024, the Company's wholly-owned subsidiary, SundaGas Banda Unipessoal, Lda., farmed out 20% of its interest in the Chuditch PSC receiving total back costs of £719,000. This represents a recovery of previously capitalised back costs of £498,000 and administration back costs of £221,000 which is credited to the Income Statement.
In addition, the Company and its joint venture partners relinquished the Inner Moray Firth P2478 licence in the UK on 31 March 2024. The associated exploration asset had already been impaired to nil as of 31 December 2023. |
|||||
|
The Directors have performed an assessment of impairment as at the balance sheet date in respect of exploration and evaluation assets, taking account of the facts and circumstances which existed at that date. Impairment reviews were performed at the Operating Segment level; following the relinquishment of the Company's interest in Inner Moray Firth P2478, the test was only performed on the Company's remaining exploration asset, the Chuditch PSC. |
|||||
|
The Directors' impairment judgement of the Chuditch exploration asset took account of a range of factors including the good standing of the PSC, the Board's expectation of the Group's ability to fulfil the obligations of Year 3 of the PSC, the expectations of access to funding to drill an appraisal well and the Board's analysis of the potential gas reserves. The assessment of potential reserves involved review of CPR work performed by external consultants as well as the Group's internal analysis. The Board also considered the wider economics of a potential export of gas and the potential value of cash flows attributable to the Group's interest in the asset. The Board concluded that no impairment indicators existed as the reporting date (2023: nil).
|
|||||
|
|
|
|
|
|
|
|
11. Investments |
|
|
|
|
|
|
|
|
|
Loans to |
Equity investment |
|
|
|
|
|
group |
in group |
|
|
|
|
|
undertakings |
undertakings |
Total |
|
|
|
|
£'000 |
£'000 |
£'000 |
|
Company |
|
|
|
|
|
|
Cost |
|
|
|
|
|
|
At 1 January 2023 |
|
|
3,840 |
7,548 |
11,388 |
|
Exchange rate adjustment |
|
|
(225) |
- |
(225) |
|
Net loan movements |
|
|
1,050 |
- |
1,050 |
|
Disposals |
|
|
- |
- |
- |
|
At 1 January 2024 |
|
|
4,665 |
7,548 |
12,213 |
|
Exchange rate adjustment |
|
|
116 |
- |
116 |
|
Additions |
|
|
- |
7 |
7 |
|
Net loan movements |
|
|
2,905 |
- |
2,905 |
|
At 31 December 2024 |
|
|
7,686 |
7,555 |
15,241 |
|
|
|
|
|
|
|
|
Impairment |
|
|
|
|
|
|
At 1 January 2023 |
|
|
942 |
5,444 |
6,386 |
|
Charge/(release) for the year |
|
|
(38) |
- |
(38) |
|
At 1 January 2024 |
|
|
904 |
5,444 |
6,348 |
|
Charge/(release) for the year |
|
|
15 |
- |
15 |
|
At 31 December 2024 |
|
|
919 |
5,444 |
6,363 |
|
|
|
|
|
|
|
|
Carrying value |
|
|
|
|
|
|
At 31 December 2024 |
|
|
6,767 |
2,111 |
8,878 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At 31 December 2023 |
|
|
3,761 |
2,104 |
5,865 |
|
|
|
|
|
|
|
|
The company makes loans to its subsidiary operations as part of its longer term strategy of undertaking exploration activities. Whilst the loans are made on informal terms, the Board consider that such loans form part of the company's net investment in its subsidiaries and therefore are presented within investments and treated as non-current. No interest is charged on intercompany loans. |
|||||
|
|
|
|
|
|
|
|
The company has made a 100% provision on the investment in Gold Oil Peru S.A.C. of £6,363,000 (2023: £6,348,000). |
|||||
|
11. Investments continued |
|
|
|
|
|
|
The Company's subsidiary undertakings at the year end were as follows: |
|
|
|||
|
Subsidiary/controlled entity |
|
Place of incorporation and operation |
Proportion of ownership interest |
Proportion of voting power held |
Nature of business |
|
|
|
|
% |
% |
|
|
|
|
|
|
|
|
|
Sunda Energy Ventures Pte. Ltd. * |
|
Singapore |
100 |
100 |
Exploration of oil and gas |
|
#02-01 |
|
|
|
|
|
|
Singapore 159637 |
|
|
|
|
|
|
|
|
|
|
|
|
|
SundaGas (Timor-Leste Sahul) Pte. Ltd. |
Singapore |
100 |
100 |
Exploration of oil and gas |
|
|
#02-01 |
|
|
|
|
|
|
Singapore 159637 |
|
|
|
|
|
|
|
|
|
|
|
|
|
SundaGas Banda Unipessoal, Lda ** |
Timor-Leste |
100 |
100 |
Exploration of oil and gas |
|
|
Av. President Nicolau Lobato |
|
|
|
|
|
|
20 de Setembro, Bebonuk, Dom Aleixo |
|
|
|
||
|
Dili, Timor-Leste |
|
|
|
|
|
|
|
|
|
|
|
|
|
Gold Oil Peru S.A.C |
Peru |
100 |
100 |
Exploration of oil and gas |
|
|
Miraflores, Lima-18, Peru |
|
|
|
|
|
|
All shareholdings are in ordinary, voting shares. |
|
||||
|
* Incorporated on 20 September 2024 |
|
|
|
|
|
|
** A direct subsidiary of SundaGas (Timor-Leste Sahul) Pte. Ltd. |
|
||||
|
|
|
|
|
|
|
|
12. Trade and other receivables |
|
|
|
||
|
|
|
2024 |
2023 |
||
|
|
|
Group |
Company |
Group |
Company |
|
|
|
£'000 |
£'000 |
£'000 |
£'000 |
|
|
|
|
|
|
|
|
Other receivables |
|
20 |
20 |
27 |
23 |
|
Prepayments |
|
66 |
38 |
64 |
33 |
|
|
|
|
|
|
|
|
|
|
86 |
58 |
91 |
56 |
|
13. Performance bond guarantee deposit |
|
||||
|
|
|
2024 |
2023 |
||
|
|
|
Group |
Company |
Group |
Company |
|
|
|
£'000 |
£'000 |
£'000 |
£'000 |
|
|
|
|
|
|
|
|
Bank guarantee bond at 31 December 2023 |
|
1,596 |
- |
786 |
-. |
|
|
|
|
|
|
|
|
The Company's wholly-owned subsidiary, SundaGas Banda Unipessoal, Lda ("SundaGas"), had provided a performance guarantee to Autoridade Nacional do Petróleo ("ANP") in respect of the offshore Timor-Leste TL-SO-19-16 Production Sharing Contract ("PSC"). This performance guarantee is secured by a bank guarantee given by Banco Nacional de Comércio de Timor-Leste ("BNCTL"), which required SundaGas to a place a bond with BNCTL of US$2,000,000. It is anticipated that the bank guarantee will be released on or before completion of the drill program. |
|||||
|
The Group is cognisant of BNCTL not having a credit rating by the main credit rating agencies. However, it is recognised that BNCTL is owned and controlled by the Government of the Democratic Republic of Timor-Leste. As a result, and given the Group's close ties with the Government, it is considered that the exposure to credit risk is immaterial.
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
14. Cash and cash equivalents |
|
|
|
|
|
|
|
|
2024 |
2023 |
||
|
|
|
Group |
Company |
Group |
Company |
|
|
|
£'000 |
£'000 |
£'000 |
£'000 |
|
|
|
|
|
|
|
|
Bank current accounts |
|
939 |
148 |
131 |
24 |
|
Bank deposit accounts |
|
2,232 |
2,231 |
3,629 |
3,628 |
|
|
|
|
|
|
|
|
|
|
3,171 |
2,379 |
3,760 |
3,652 |
|
|
|
|
|
|
|
|
Bank deposit accounts comprise cash held by the Group and short-term bank deposits with an original maturity of three months or less and earn interest at respective short-term deposit rates. The carrying amount of these assets approximates to their fair value. |
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
15. Trade and other payables |
|
2024 |
2023 |
||
|
|
|
Group |
Company |
Group |
Company |
|
|
|
£'000 |
£'000 |
£'000 |
£'000 |
|
|
|
|
|
|
|
|
Trade payables |
|
274 |
17 |
18 |
18 |
|
Other payables |
|
32 |
- |
- |
- |
|
Amounts owed to subsidiary undertakings |
- |
8 |
- |
- |
|
|
Accruals |
|
278 |
49 |
136 |
73 |
|
Lease finance liability due within 12 months |
|
13 |
9 |
31 |
9 |
|
Taxation |
|
16 |
16 |
15 |
15 |
|
|
|
|
|
|
|
|
|
|
613 |
99 |
200 |
115 |
|
|
|
|
|
|
|
|
Non-current liabilities |
|
|
|
|
|
|
Lease finance liabilities due after 12 months |
|
8 |
8 |
4 |
- |
|
|
|
|
|
|
|
|
16. Lease finance |
|
|
|
|
|
|
Lease liabilities are presented in the statement of financial position as follows: |
|
|
|||
|
|
|
2024 |
2023 |
||
|
|
|
Group |
Company |
Group |
Company |
|
|
|
£'000 |
£'000 |
£'000 |
£'000 |
|
Current |
|
13 |
9 |
31 |
9 |
|
Non-current |
|
8 |
8 |
4 |
- |
|
|
|
|
|
|
|
|
|
|
21 |
17 |
35 |
9 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
17. Share capital |
|
|
|
2024 |
2023 |
|
|
|
|
|
£'000 |
£'000 |
|
Allotted, called up and fully paid |
|
|
|
|
|
|
Equity:25,510,783,788 (2023: 18,982,760,428) ordinary shares of £0.00025 each |
6,378 |
4,746 |
|||
|
|
|
|
|
|
|
|
|
|
|
|
6,378 |
4,746 |
|
|
|
|
|
|
|
|
The Company issued 6,528,025,360 new ordinary shares of £0.00025 each at £0.0005 per share on 29 February 2024 for cash. |
|||||
|
|
|
|
|
|
|
|
Ordinary shares entitle the holder to full rights as to voting, dividends and any distribution upon winding up. |
|||||
|
|
|
|
|
|
|
|
18. Share premium and reserves |
|
|
|
Foreign |
|
|
|
|
Share |
Share |
exchange |
Profit |
|
|
|
premium |
option |
translation |
and loss |
|
|
|
account |
reserve |
reserve |
account |
|
|
|
£'000 |
£'000 |
£'000 |
£'000 |
|
Group |
|
|
|
|
|
|
At beginning of the year |
|
38,881 |
319 |
715 |
(36,406) |
|
Loss for the year attributable to controlling interests |
- |
- |
- |
(2,049) |
|
|
Issue of new shares |
|
1,632 |
- |
- |
- |
|
Share issue costs |
|
(271) |
- |
- |
- |
|
Share-based payments |
|
- |
40 |
- |
- |
|
Share option reserve released |
|
- |
(21) |
- |
21 |
|
Foreign exchange translation adjustments |
- |
- |
80 |
- |
|
|
|
|
40,242 |
338 |
795 |
(38,434) |
|
|
|
|
|
|
|
|
Company |
|
|
|
|
|
|
At beginning of the year |
|
38,881 |
319 |
- |
(34,479) |
|
Loss for the year |
|
- |
- |
- |
(1,273) |
|
Issue of new shares |
|
1,632 |
- |
- |
- |
|
Share issue costs |
|
(271) |
- |
- |
- |
|
Share-based payments |
|
- |
40 |
- |
- |
|
Share option reserve released |
|
- |
(21) |
- |
21 |
|
|
|
40,242 |
338 |
- |
(35,731) |
|
18. Share premium and reserves continued |
|
|
|
|
|
|
|
|
Details of options and warrants issued, exercised and lapsed during the year together with options and warrants outstanding at 31 December 2024 are as follows: |
|
|
|||||
|
|
|
|
1 January |
New |
|
Lapsed or |
31 December |
|
|
|
Exercise |
2024 |
Issue |
Exercised |
cancelled |
2024 |
|
Issue date |
Final exercise date |
price |
Number |
Number |
Number |
Number |
Number |
|
26 May 2020 |
26 May 2030 |
£0.00100 |
62,500,000 |
- |
- |
- |
62,500,000 |
|
22 July 2021 |
22 July 2031 |
£0.00070 |
440,000,000 |
- |
- |
(50,000,000) |
390,000,000 |
|
22 July 2021 |
31 December 2025 |
£0.00070 |
150,000,000 |
- |
- |
- |
150,000,000 |
|
17 December 2021 |
17 December 2031 |
£0.00060 |
530,000,000 |
- |
- |
(60,000,000) |
470,000,000 |
|
14 July 2022 |
14 July 2025 |
£0.00070 |
175,000,000 |
- |
- |
- |
175,000,000 |
|
20 November 2024 |
20 November 2034 |
£0.000725 |
- |
975,000,000 |
- |
- |
975,000,000 |
|
9 December 2024 |
21 July 2031 |
£0.00060 |
- |
50,000,000 |
- |
- |
50,000,000 |
|
9 December 2024 |
19 December 2031 |
£0.00070 |
- |
60,000,000 |
- |
- |
60,000,000 |
|
|
|
|
1,357,500,000 |
1,085,000,000 |
- |
(110,000,000) |
2,332,500,000 |
|
|
|
|
|||||
|
Details of options and warrants issued, exercised and lapsed during the year together with options and warrants outstanding at 31 December 2023 are as follows: |
|
|
|||||
|
|
|
|
1 January |
New |
|
|
31 December |
|
|
|
Exercise |
2023 |
Issue |
Exercised |
Lapsed |
2023 |
|
Issue date |
Final exercise date |
price |
Number |
Number |
Number |
Number |
Number |
|
26 May 2020 |
26 May 2030 |
£0.00100 |
125,000,000 |
- |
(62,500,000) |
- |
62,500,000 |
|
22 July 2021 |
22 July 2031 |
£0.00070 |
440,000,000 |
- |
- |
- |
440,000,000 |
|
22 July 2021 |
31 December 2025 |
£0.00070 |
150,000,000 |
- |
- |
- |
150,000,000 |
|
17 December 2021 |
17 December 2031 |
£0.00060 |
530,000,000 |
- |
- |
- |
530,000,000 |
|
14 July 2022 |
14 July 2025 |
£0.00070 |
175,000,000 |
- |
- |
- |
175,000,000 |
|
|
|
|
1,420,000,000 |
- |
(62,500,000) |
- |
1,357,500,000 |
|
The number of share options which were exercisable at year end was 1,182,500,000 (2023: 1,182,500,000). The weighted average remaining life of share options at the year end was 7 years (2023: 7 years). The weighted average exercise price (in pence) applying to share options during the year was as follows: |
|
||||||
|
|
|
|
|
|
2024 |
2023 |
|
|
Opening |
|
|
|
|
0.07p |
0.07p |
|
|
Exercised |
|
|
|
|
- |
0.10p |
|
|
Lapsed |
|
|
|
|
- |
- |
|
|
Cancelled |
|
|
|
|
0.065p |
- |
|
|
Issued |
|
|
|
|
0.0725p |
- |
|
|
Closing |
|
|
|
|
0.07p |
0.07p |
|
|
19. Share based payments |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The fair values of the options and warrants granted have been calculated using Black--Scholes model assuming the inputs shown below: |
||||||
|
Grant date |
|
20 November 2024 |
17 December 2021 |
22 July 2021 |
22 July 2021 |
26 May 2020 |
|
|
|
|
|
|
|
|
|
Number of options or warrants granted |
975,000,000 |
530,000,000 |
150,000,000 |
440,000,000 |
290,000,000 |
|
|
Share price at grant date |
|
0.0725p |
0.06p |
0.07p |
0.07p |
0.05p |
|
Exercise price at grant date |
|
0.0725p |
0.06p |
0.07p |
0.07p |
0.1p |
|
Option life |
|
10 years |
10 years |
3 years |
10 years |
10 years |
|
Risk free rate |
|
4.47% |
0.86% |
0.86% |
0.86% |
0.86% |
|
Expected volatility |
|
66% |
80% |
80% |
80% |
80% |
|
Expected dividend yield |
|
0% |
0% |
0% |
0% |
0% |
|
Fair value of option |
|
0.058p |
0.025p |
0.02p |
0.03p |
0.02p |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The warrants and options will not normally be exercisable during a closed period and furthermore can only be exercisable if the performance conditions are satisfied. Warrants and options, which have vested immediately before either the death of a participant or his ceasing to be an eligible employee by reason of injury, disability, redundancy or dismissal (otherwise than for good cause) shall remain, exercisable (to the extent vested) for 12 months after such cessation, and all non-vested options shall lapse. |
||||||
|
|
|
|
|
|
|
|
|
On 14 July 2022, the company awarded 175,000,000 share options to a Dr A Butler. The share options are exercisable at 0.07p, expire three years from grant date and will only vest upon the Company making an announcement that the first appraisal well on the Chuditch PSC has spudded, or in certain limited circumstances such as a takeover event. Given that vesting is contingent on the spudding of a well at the Chuditch project and that the occurrence of this event is dependent, inter alia, on events outside the control of the director, the Board considered that the current degree of certainty over vesting was such that no share-based payment charges were recorded in respect of these options during 2022, 2023 or 2024. A detailed summary of the current status and future plans for the Chuditch project are given in the Chairman's Statement & Operations Report.
|
||||||
|
Of the 1,085,000,000 options issued in the year, 110,000,000 related to the release and re-issue of existing options held by an employee on substantially the same terms for an administrative purpose. The re-issue was treated as a modification with no incremental fair value recognised.
Options granted on 20 November 2024 vest over a period of 1 to 3 years. The share-based payment charge arising is amortised over the vesting period.
|
||||||
|
Volatility was determined by reference to the company's historical share price volatility over a suitable period. |
||||||
20. Financial instruments
The Group's and Company's activities expose them to a variety of financial risks: credit risk, cash flow interest rate risk, foreign currency risk, liquidity risk, price risk and capital risk. The Group's and Company's activities also expose them to non-financial risks: market risk. The Group's and Company's overall risk management programme focuses on unpredictability and seeks to minimise the potential adverse effects on the Group's financial performance. The Board, on a regular basis, reviews key risks and, where appropriate, actions are taken to mitigate the key risks identified.
Financial instruments - Risk Management
The Group and Company are exposed through their operations to the following risks:
Ø Credit risk
Ø Cash flow interest rate risk
Ø Foreign Exchange Risk
Ø Liquidity risk
Ø Price risk
Ø Capital risk
Ø Market risk
In common with all other businesses, the Group and the Company are exposed to risks that arise from its use of financial instruments. This note describes the Group's and the Company's objectives, policies and processes for managing those risks and the methods used to measure them. Further quantitative information in respect of these risks is presented throughout these financial statements.
There have been no substantive changes in the Group's or the Company's exposure to financial instrument risks, its objectives, policies and processes for managing those risks or the methods used to measure them from previous periods unless otherwise stated in this note.
Principal financial instruments
The principal financial instruments used by the Group and the Company, from which financial instrument risk arises are as follows:
Ø Loans and receivables
Ø Trade and other receivables
Ø Cash and cash equivalents
Ø Trade and other payables
General objectives, policies and processes
The Board has overall responsibility for the determination of the Group's and the Company's risk management objectives and policies and, whilst retaining responsibility for them, it has delegated the authority for designing and operating processes that ensure the effective implementation of the objectives and policies to the Group's finance function. The Board receives regular updates from the Executive Directors through which it reviews the effectiveness of the processes put in place and the appropriateness of the objectives and policies it sets. The overall objective of the Board is to set policies that seek to reduce risk as far as possible without unduly affecting the Group's and the Company's competitiveness and flexibility. Further details regarding these policies are set out below:
Credit risk
The Group's and the Company's principal financial assets are bank balances and cash, the bank guarantee bond, and other receivables. The credit risk on liquid funds is limited because the counterparties are banks with high credit ratings assigned by international credit-rating agencies or are sovereign-owned and backed banks (see also note 13). The amounts presented in the statements of financial position are net of allowance for doubtful receivables. An allowance for impairment is made where there is an identified loss event which, based on previous experiences, is evidence of a reduction in the recoverability of the cash flows.
As at 31 December 2024 and 2023 there were no trade receivables and no expected credit losses were raised against any financial assets held at amortised cost.
Cash flow interest rate risk
The Group and the Company are exposed to cash flow interest rate risk from its deposits of cash and cash equivalents with banks.
The cash balances maintained by the Group and the Company are proactively managed in order to ensure that the maximum level of interest is received for the available funds but without affecting the working capital flexibility the Group requires.
The Group and the Company are not at present exposed to cash flow interest rate risk on borrowings as neither has significant debt. No subsidiary company of the Group is permitted to enter into any borrowing facility or lease agreement without the prior consent of the Company.
Interest rates on financial assets
The Group's and the Company's financial assets consist of cash and cash equivalents, loans, trade and other receivables. The interest rate profile at period end of these assets was as follows:
|
31 December 2024
Group |
|
Financial assets on which interest earned |
Financial assets on which interest not earned |
Total |
|
|
|
£'000 |
£'000 |
£'000 |
|
|
|
|
|
|
|
UK sterling |
|
1,907 |
67 |
1,974 |
|
US dollar (USD) |
|
325 |
2,405 |
2,730 |
|
Singapore Dollar (SGD) |
|
- |
93 |
93 |
|
|
|
2,232 |
2,565 |
4,797 |
|
|
|
|
|
|
|
31 December 2023
Group |
|
Financial assets on which interest earned |
Financial assets on which interest not earned |
Total |
|
|
|
£'000 |
£'000 |
£'000 |
|
|
|
|
|
|
|
UK sterling |
|
2,509 |
33 |
2,542 |
|
US dollar (USD) |
|
1,120 |
906 |
2,026 |
|
Singapore Dollar (SGD) |
|
- |
3 |
3 |
|
|
|
3,629 |
942 |
4,571 |
The Group and the Company earned interest on its interest-bearing financial assets at rates between 2.5% and 5.5% (2023 2% and 5.5%) during the period.
A change in interest rates on the statement of financial position date would increase/(decrease) the equity and the anticipated annual income or loss by the theoretical amounts presented below. The analysis is made on the assumption that the rest of the variables remain constant. The analysis with respect to 31 December 2024 was prepared under the same assumptions.
|
Group and Company |
Change of 1.0% in the interest rate as of |
|||
|
|
31 December 2024 |
31 December 2023 |
||
|
|
Increase of 1.0% |
Decrease of 1.0% |
Increase of 1.0% |
Decrease of 1.0% |
|
Instruments bearing variable interest (£'000) |
38 |
(38) |
36 |
(36) |
It is considered that there have been no significant changes in cash flow interest rate risk at the reporting date compared to the previous period end and that therefore this risk has had no material impact on earnings or shareholders' equity.
Foreign exchange risk
Foreign exchange risk arises because the Group and the Company have operations located in various parts of the world whose functional currency is not the same as the functional currency in which other Group companies are operating. Although its geographical spread reduces the Group's and the Company's operation risk, the net assets arising from such overseas operations are exposed to currency risk resulting in gains and losses on retranslation into Sterling. Only in exceptional circumstances will the Group or the Company consider hedging its net investments in overseas operations, as generally it does not consider that the reduction in foreign currency exposure warrants the cash flow risk created from such hedging techniques. It is the Group's policy to ensure that individual Group entities enter into local transactions in their functional currency wherever possible and that only surplus funds over and above working capital requirements should be transferred to the parent company treasury. The Group considers this policy minimises any unnecessary foreign exchange exposure.
In order to monitor the continuing effectiveness of this policy the Board, through its approval of both corporate and capital expenditure budgets and review of the currency profile of cash balances and management accounts, considers the effectiveness of the policy on an ongoing basis.
The following table discloses the major exchange rates of those currencies utilised by the Group:
|
Group and Company |
|
USD |
SGD |
|
Average for year ended 31 December 2024 |
|
1.278 |
1.707 |
|
At 31 December 2024 |
|
1.253 |
1.708 |
|
Average for year ended 31 December 2023 |
|
1.244 |
1.669 |
|
At 31 December 2023 |
|
1.273 |
1.679 |
|
|
|
|
|
A change in exchange rates on the statement of financial position date would increase/(decrease) the equity and net asset position by the theoretical amounts presented below. The analysis is made on the assumption that the rest of the variables remain constant. The analysis with respect to 31 December 2023 was prepared under the same assumptions.
|
|
Change of 10.0% in the GBP/USD rate as of |
|||
|
|
31 December 2024 |
31 December 2023 |
||
|
|
Increase of 10.0% |
Decrease of 10.0% |
Increase of 10.0% |
Decrease of 10.0% |
|
Net assets (£'000) - Group |
(511) |
624 |
(402) |
492 |
|
Net assets (£'000) - Company |
(625) |
764 |
(445) |
544 |
It is considered that there have been no significant changes in exchange rate risk at the reporting date compared to the previous period end and that therefore this risk has had no material impact on earnings or shareholders' equity.
Liquidity risk
Liquidity risk arises from the Group's management of working capital and the finance charges and principal repayments on its debt instruments. It is the risk that the Group will encounter difficulty in meeting its financial obligations as they fall due.
The Group's policy is to ensure that it will always have sufficient cash to allow it to meet its liabilities when they become due. To achieve this aim, it seeks to maintain readily available cash balances (or agreed facilities) to meet expected requirements for a period of at least 60 days. The Group currently has no long term borrowings.
All of the Group's and the Company's financial liabilities are due within one year other than undiscounted lease liabilities due after one year of £8,000 (2023: £4,000).
Price risk
Potential oil and gas sales revenue is subject to energy market price risk.
Given that the Group and the Company currently do not have production, it is not considered appropriate for the Group or the Company to enter into any hedging activities or trade in any financial instruments, such as derivatives. This strategy will continue to be subject to regular review.
It is considered that price risk of the Group and the Company at the reporting date has not increased compared to the previous period end.
Volatility of oil and gas prices
A material part of the Group's future revenue will be derived from the sale of oil and gas that it expects to produce. A future substantial or extended decline in prices for oil and gas and refined products could adversely affect the Group's future revenues, cash flows, profitability and ability to finance its planned capital expenditure. The movement of crude oil and natural gas prices is shown below:
|
|
|
|
||
|
|
|
31 December 2024 |
Average price 2024 |
31 December 2023 |
|
Crude oil - WTI |
|
|
|
|
|
Per barrel - US$ |
|
$71 |
$74 |
$72 |
|
Per barrel - £ |
|
£57 |
£58 |
£57 |
|
|
|
══════ |
══════ |
══════ |
|
Natural gas LNG Japan/Korea Marker (Platts) |
|
|
|
|
|
Per Million Btu - US$ |
|
$14 |
$12 |
$9 |
|
Per Million Btu - £ |
|
£9 |
£9 |
£7 |
|
|
|
══════ |
══════ |
══════ |
|
|
|
|
|
|
Oil and gas prices are dependent on a number of factors impacting world supply and demand. Due to these factors, prices may be subject to significant fluctuations from year to year. However, these prices had no effect on the Group's results for 2024, since it had no production.
Capital risk
The Group's and the Company's objectives when managing capital are to safeguard the ability to continue as a going concern in order to provide returns for shareholders and benefits to other stakeholders and to maintain an optimal capital structure to reduce the cost of capital.
21. Capital commitments
As of 31 December 2024, there were no capital commitments (2023: none).
22. Contingent Liabilities
The Group has provided performance guarantees to ANP in respect of the TL-SO-19-16 PSC, in the form of a bank guaranteed performance bond of US$2,000,00 given by SundaGas , plus a further guarantee provided by the Company of US$3,200,000. In the event of non-performance under the PSC, there is a potential liability to the Group of up to US$5,200,000 and to the Company only of US$3,200,000. The Company believes that there is no indication of a breach of the terms of the PSC. See also note 13 on page 57.
In respect of the Company's performance guarantee of up to $3.2m, the Board consider that the guarantee is not a financial guarantee contract or insurance contract and so is accounted for as a contingent liability which would only crystallise in the event of non performance under the PSC. As the Board considered there was no non-performance of the PSC as at period end, no liability has been assessed under the guarantee.
The Board considers that there are no potential decommissioning costs in respect of abandoned fields relating to any current or historic exploration activity.
23. Events after the reporting period
On 24 April 2025, the Company announced that its wholly owned subsidiary SundaGas Banda Unipessoal, Lda. ("SundaGas") will be entering into a binding Farm-In agreement with its government-owned joint venture partner TIMOR GAP Chuditch Unipessoal Lda ("TIMOR GAP"). In addition, the Company has conditionally raised up to US$9.0 million, before expenses, by way of the issue of unsecured convertible loan notes ("Loan Notes" or "CLNs") to three institutional investors. Together, these combined funding arrangements will enable the Company to execute a contract for the use of a jack-up rig to drill the Chuditch-2 appraisal well.
Under the terms of the Farm-In Agreement, SundaGas will assign an initial 30% interest to TIMOR GAP. This interest is in addition to the 15% interest acquired by TIMOR GAP in the Farm-In transaction completed on 8 February 2024 and its original 25% interest (which portion is carried to first gas). This assignment will result in SundaGas retaining a significant 30% working interest in the Chuditch PSC, while TIMOR GAP will have a 70% interest.
On 13 May 2025, the Company announced that each investor has subscribed for the initial tranche of an aggregate of US$1.5 million of Loan Notes, and funds were received on the same day. On 16 May 2025, the Company further announced that it had received notice from all of the participating investors to convert all of the outstanding balance of their Loan Notes into Ordinary Shares of 0.025p each in the Company. As a result, 3,125,594,493 new Ordinary Shares were issued at a price of 0.03995p per share. In addition, the Company has granted Warrants to the investors pursuant to the conversion. In aggregate, 1,803,227,592 Warrants have been granted to the investors. One Warrant will entitle the Investors to subscribe for one Ordinary Share at a price of 0.051935 pence.
|
24. Related party transactions |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Company |
|
|
|
|
|
|
|
During the year, the Company advanced loans to its subsidiaries. The details of the transactions and the amount owed by the subsidiaries at the year end were. |
||||||
|
|
Year ended 31 December 2024 |
Year ended 31 December 2023 |
||||
|
|
|
Balance |
Loan advance |
Balance |
Loan advance |
|
|
|
|
£'000 |
£'000 |
£'000 |
£'000 |
|
|
|
|
|
|
|
|
|
|
SundaGas (Timor-Leste Sahul) Pte. Ltd |
5,870 |
2,904 |
2,878 |
1,622 |
||
|
SundaGas Banda Unipessoal, Lda |
897 |
- |
883 |
253 |
||
|
Sunda Energy Ventures Pte. Ltd. |
|
(8) |
(8) |
- |
- |
|
|
Gold Oil Peru S.A.C * |
|
918 |
14 |
904 |
10 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
* The company has provided for an impairment of £918,000 (2023: £904,000) on the outstanding loans. |
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Group and company |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SundaGas (Timor-Leste Sahul) Pte. Ltd ("TLS"), a wholly-owned subsidiary paid fees amounting to US$411,000 (2023: US$285,000) to SundaGas Pte. Ltd ("SGPL"), a company in which Dr. Andrew Butler, a director, held a significant interest. At the end of the period, there was a balance payable to SGPL of US$40,065 (2023: nil). |
||||||
|
|
|
|
|
|
|
|
|
The Company paid fees amounting to £42,149 (2023: nil) to Javelin Capital Partners LLP, an entity in which Mr Gerry Aherne, a director, held a significant interest. These fees are included in directors' remuneration in note 5. At the end of the period, there was a balance payable to the related party of £5,417 (2023: nil). |
||||||
|
|
|
|
|
|
|
|
|
The directors' aggregate remuneration and any associated benefits in respect of qualifying services are disclosed in note 5. |
||||||
|
|
||||||
|
During the year, amounts of £10,661 (2023: nil) were advanced to a director. The amount receivable at the end of the year was £10,661 (2023: nil).
|
||||||
Glossary of Technical Terms
|
Bcf |
Billion standard cubic feet of natural gas. |
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Geological chance of success |
The estimated probability that exploration activities will confirm the existence of a significant accumulation of potentially recoverable petroleum. |
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Contingent Resources |
Those quantities of petroleum estimated, as of a given date, to be potentially recoverable from known accumulations by application of development projects, but which are not currently considered to be commercially recoverable owing to one or more contingencies. |
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GIIP |
Volume of natural gas initially in-place in a reservoir. |
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High Estimate
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Denotes the high estimate qualifying as Prospective Resources. Reflects a volume estimate that there is a 10% probability that the quantities actually recovered will equal or exceed the estimate.
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Licence Operator
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The Company nominated to carry out operational activities. |
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Mean |
Reflects an unrisked median or best-case volume estimate of resource derived using probabilistic methodology. This is the mean of the probability distribution for the resource estimates and is often not the same as 2U as the distribution can be skewed by high resource numbers with relatively low probabilities. |
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MMBBL
MMBOE, Oil equivalent |
Million barrels of oil or condensate.
Million barrels of oil equivalent. Volume derived by dividing the estimate of the volume of natural gas in billion cubic feet by six in order to convert it to an equivalent in million barrels of oil or condensate, and, where relevant, adding this to an estimate of the volume of oil in millions of barrels. |
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Prospective Resources |
Quantities of petroleum that are estimated to exist originally in naturally occurring reservoirs, as of a given date. Crude oil in-place, natural gas in-place, and natural bitumen in-place are defined in the same manner. |
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PSC |
Production Sharing Contract. |
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SPE PRMS 2018 |
The Society of Petroleum Engineers' ("SPE") Petroleum Resources Management System ("PRMS") is a system developed for consistent and reliable definition, classification, and estimation of hydrocarbon resources prepared by the Oil and Gas Reserves Committee of SPE and approved by the SPE Board in June 2018 following input from six sponsoring societies: the World Petroleum Council, the American Association of Petroleum Geologists, the Society of Petroleum Evaluation Engineers, the Society of Exploration Geophysicists, the European Association of Geoscientists and Engineers, and the Society of Petrophysicists and Well Log Analysts. |
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SPE PRMS Unrisked Prospective Resources |
Denotes the unrisked estimate qualifying as SPE PRMS 2018 Prospective Resources.
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Tcf |
Trillion standard cubic feet of gas |
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