REG - Afentra PLC - Half Year Results
27/09/2022 07:01
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RNS Number : 7007A Afentra PLC 27 September 2022
27 September 2022
AFENTRA PLC
2022 HALF YEAR RESULTS
Afentra plc ('Afentra' or the 'Company'), the upstream oil and gas company
focused on acquiring mature production and development assets in Africa,
announces its half year results for the six months ended 30 June 2022 (the
'Period').
Financial Summary
· Cash resources as at 30 June 2022 of $27.1 million (30 June 2021
of $40.8 million)
· Additional restricted funds of $8.0 million(1)
· Adjusted EBITDAX loss of $1.2 million (1H 2021: loss $1.5
million)
· Loss after tax of $2.9 million (1H 2021: loss $2.4 million)
· The Group remains debt free and fully carried for Odewayne
operations
Angolan Acquisitions
The Company announced two strategically consistent and complementary
transactions in Angola, signing sale and purchase agreements ('SPAs') with
completion expected in Q4 2022 (together the 'Acquisitions'):
· Sonangol Acquisition: acquisition of interests in Block 3/05
(20%) and Block 23 (40%) offshore Angola for a firm consideration of $80.5
million and contingent payments of up to $50 million;
· INA Acquisition: acquisition of interests in Block 3/05 (4%) and
Block 3/05A (5.33%)(2) offshore Angola for a firm consideration of $12 million
and contingent payments of up to $21 million;(3)
· Financing Agreements: Sonangol and INA Acquisitions will be
financed through cash on the balance sheet and agreed RBL and revolving
working capital facilities with Trafigura:
o 5-year RBL facility with up to $75 million available to finance the
Acquisitions (8% margin over 3-month secured overnight financing rate (the
'SOFR')) (the 'Acquisition Facility');
o Revolving working capital facility for up to $30 million to finance asset
funding requirements between crude offtakes (4.75% over 1-month SOFR) (the
'Working Capital Facility').
· Offtake Agreement: The Company has also entered into an offtake
agreement with Trafigura for Afentra's crude oil entitlement lifted from the
Acquisitions.(4)
AIM Re-admission Process
· AIM Admission Document was published on 10 August 2022.
Suspension of the trading in the Company's shares was lifted and trading in
the Company's ordinary shares recommenced
· General Meeting: Resolution to approve the Sonangol Acquisition
was passed at the General Meeting held on 30 August 2022
· Completion of the Acquisitions and re-admission of the enlarged
group to trading on AIM is anticipated in Q4 2022
Operations Summary
Operations pursuant to the ongoing Acquisitions
· Block 3/05: Congo basin, Angola (24% interest)(5) - net 2P
reserves of 27.7 mmbo, net 1H 2022 production of c. 4,700 bbl/day, net 2C
resources of 10 mmbo with significant potential for future upgrades
· Block 3/05A: Congo basin, Angola (5.33% interest)(2,5) - three
appraised discoveries in adjacent licence to Block 3/05, providing tie-back
opportunities using existing infrastructure; net 2C resource of 1.8 mmbo
· Block 23: Kwanza basin, Angola (40% interest)(5) - highly
prospective deepwater exploration and appraisal opportunity that is largely
under-explored containing a small pre-salt oil discovery
Existing operations
· Odewayne exploration block: offshore Somaliland (34% interest
fully carried by operator, Genel Energy) - the team continues its technical
assessment and outlook on block prospectivity in discussion with the operator
Paul McDade, Chief Executive Officer, Afentra plc commented: "The first half
of 2022 marked a transformational period for the Company, including the
foundational asset transaction with Sonangol enabling entry into Block 3/05 in
Angola. Following Period end, Afentra announced an incremental transaction
with INA gaining additional exposure to the high quality 3/05 block and the
adjacent 3/05A block. Combined, these complementary acquisitions provide a
strong growth platform, underpinned by robust cash flow and significant
potential to deliver upside value. The financing and offtake agreements
announced with Trafigura demonstrate our ability to efficiently fund our
focussed buy and build strategy. In August, we were pleased to recommence
trading in Afentra's shares on AIM and, subsequently, shareholder approval of
the Sonangol transaction. We take confidence that the completion of a smooth
election process and the re-instatement of the government will allow the
Company to re-engage with the Government to achieve completion of the
transactions in Q4 2022. Meanwhile, the Company continues to remain highly
active and disciplined in its assessment of the opportunity landscape in line
with its stated growth strategy."
For further information contact:
Afentra plc +44 (0)20 7405 4133
Paul McDade, CEO
Anastasia Deulina, CFO
Buchanan (Financial PR) +44 (0)20 7466 5000
Ben Romney
Jon Krinks
Peel Hunt LLP (Nominated Advisor and Joint Broker) +44 (0)20 7418 8900
Richard Crichton
David McKeown
Tennyson Securities (Joint Broker) +44 (0)20 7186 9033
Peter Krens
(1) Please refer to Note 4 (notes to the accounts) for further detail on
restricted funds.
(2) Subject to final approval of the distribution of the China Sonangol
International ('CSI') interest to the remaining joint venture partners.
(3) $12 million upfront consideration is split $9 million for 4% interest in
Block 3/05 and $3 million for 5.33% interest in Block 3/05A. $21 million in
contingent payments broken down as $10 million upon licence extension of Block
3/05 (from 2025 to 2040), up to $6 million for Block 3/05 subject to certain
oil price hurdles, and $5 million linked to successful future development of
certain discoveries in Block 3/05A.
(4) Subject to the terms of the Trafigura Offtake Agreement.
(5) Subject to completion of the Acquisitions.
CEO Statement
I am pleased to provide an update on Afentra's progress in the first half of
2022, a period in which we have announced a transformative inaugural
acquisition, enabling the Company to enter Angola, a major oil and gas
jurisdiction with significant opportunities ahead to build a material business
and positively impact the energy transition in Africa.
The Sonangol Acquisition aligns with the management team's clearly defined
strategic vision set out at launch in May 2021: to capitalise on opportunities
presented by the accelerating energy transition in Africa and in doing so
support a responsible transfer of asset ownership that provides beneficial
outcomes for all stakeholders involved. The industry trends and market drivers
that formed the basis of Afentra's strategy at the time of launch have only
strengthened this year in terms of a greater emphasis on energy security and a
more pragmatic understanding of the timeline required for an effective and
responsible energy transition.
Following Period end, we have been pleased to announce an incremental and
accretive transaction with INA, increasing Afentra's exposure to this
high-quality asset, underpinned by strong cash flow from stable and long-life
production and 28 million barrels of net 2P Reserves, as per the published
CPR. With Trafigura, Afentra have also secured an RBL facility, flexible
working capital facility, and offtake agreement; combined, these provide the
financial headroom for the business while limiting the Company's exposure to
offtake risk with the sale and purchase secured for 100% of Afentra's
entitlement to crude oil lifted from the acquired assets.
In August, we were delighted to recommence trading in Afentra's shares on the
AIM market after the lengthy suspension period associated with the RTO
process, as well as shareholder approval of the Sonangol Acquisition. We take
confidence that a smooth reinstatement of government in Angola (following the
general election) will help the Company to re-engage with the Angolan
government to achieve completion of the transactions in Q4 2022.
The market landscape in terms of the industry transition that supports
Afentra's long-term growth strategy remains compelling, despite the current
impact of a volatile commodity price environment, and we remain highly active
and disciplined in our assessment of the opportunity landscape. The initial
transactions in Angola represent the first steps towards our more ambitious
growth targets and demonstrate the value accretion that can be achieved
through the team's disciplined approach to M&A.
To support our business development activities, we continue to engage with
both debt and equity capital markets to ensure we have supportive investors
and access to capital for any deals we bring to market. We look forward to
demonstrating the true value accretive nature of these initial transactions as
we complete them both in the coming months and begin working with the Operator
and JV partners to optimise production, enhance environmental performance and
realise the material upside value from these licences.
Overall, it has been a transformational first half of the year for Afentra and
we have since made further headway with our stated growth ambitions. We thank
our shareholders for their support and look forward to delivering positive
outcomes for all our stakeholders through the second half of the year and
beyond.
Angolan Acquisitions and Financing Agreements
The Company has announced two strategically consistent and complementary
transactions in Angola, signing sale and purchase agreements ('SPAs') with
completion expected in Q4 2022. The SPA for the Sonangol Acquisition was
signed with Sonangol Pesquisa e Produção S.A. ('Sonangol') on 28 April 2022.
This was to acquire a 20% interest in Block 3/05 offshore Angola for a firm
consideration of $80 million and contingent payments of up to $50 million (in
aggregate) and Block 23 (40%) for a $0.5 million consideration. The SPA for
the INA Acquisition was signed with Industrija Nafte, d.d ('INA') on 19 July
2022. This was to acquire (i) a 4% interest in Block 3/05 offshore Angola for
an initial consideration of $9 million, additional considerations of $10
million and up to $6 million payable upon licence extension and certain oil
price hurdles, respectively; (ii) a 5.33% interest in Block 3/05A offshore
Angola for an initial consideration of $3 million and contingent consideration
of up to $5 million linked to successful future development of certain
discoveries and oil price hurdles. The Acquisitions will be financed through
cash on the balance sheet and agreed RBL acquisition facility and a revolving
working capital facility agreed with Trafigura. The Company has also entered
into an offtake agreement with Trafigura (the 'Trafigura Offtake Agreement')
to secure the sale and purchase of 100% of Afentra's entitlement to the crude
oil lifted from the acquired assets in Angola (subject to the terms of the
Trafigura Offtake Agreement).
The Acquisition Facility and Working Capital Facility were signed with Trafigura on 10 August 2022 with Afentra Angola as original borrower and the Company as original guarantor. The Acquisition Facility is a senior secured 5-year RBL facility agreement for up to $110 million, with up to $75 million available to finance the Acquisitions ($60 million and $15 million to fund the Sonangol and INA Transactions, respectively). The terms include an 8% margin over 3-month SOFR, semi-annual linear amortisations and conventional RBL covenants. The revolving working capital facility agreement is for up to $30 million to finance asset funding requirements between crude offtakes, repayable with the proceeds from each crude lifting and maturing on the date on which the Trafigura Offtake Agreement terminates. Interest is payable at 4.75% over 1-month SOFR. Further detail on the Acquisitions, Acquisition Facility, Working Capital Facility and Trafigura Offtake Agreement can be found on the Company's website at
www.afentraplc.com (http://www.afentraplc.com)
and in the admission document.
Operations Review
Angola
Angola is one of the largest oil producers in Africa with current production
of 1.2 million bopd from deepwater, shallow water & onshore dating back to
1956. The economy is dependent on responsible management of hydrocarbon
resources. Investment has historically been dominated by IOCs, however assets
are starting to change hands. Afentra believes that the situation is similar
to the status to the UKCS where a more mature industry transition has already
played out. Global research and consultancy business Wood Mackenzie has
identified ~15 billion barrels of oil and gas reserves in Angola, highlighting
the scale of opportunity in Angola. According to IHS Markit Consulting, close
to 300 fields have been discovered with less than half developed (IHS 2022).
Over the last 5 years, the Angolan government led by President Joao Louranco
has actively sought new oil and gas investors alongside improving fiscal terms
and extending licenses. There are large opportunities for growth and limited
competition in the independent space.
Block 3/05 (24%)
Block 3/05 is located in the Lower Congo Basin and consists of eight mature
producing fields. The discoveries were made by Elf Petroleum (now part of
TotalEnergies) in the early 1980s. Development was by shallow-water (40-100m)
platforms that included successful waterflood activities with first oil in
1985. Sonangol assumed operatorship from 2005 and has focused on sustaining
production through workovers and maintaining asset integrity. No infill
drilling campaigns have taken place in the last 15 years. The asset has a
diverse portfolio of over 100 wells and currently produces from around 40
production wells and has nine active water injectors. The facilities include
17 well-head and support platforms and four processing platforms, with oil
exported via the Palanca FSO.
In the 1H of 2022 average daily gross production was ~19,500 bopd. Gross 2P
reserves are 115 mmbo as of 1 April 2022 and 2C resources are 42 mmbo. Block
3/05's existing Production Sharing Agreement ('PSA') expires in 2025 and this
is expected to be extended to 2040. This extension is a condition to
completing the Acquisition. To date, the asset decommissioning costs have been
pre-funded to the amount of $554 million.
Post completion of the Acquisition, the JV will be comprised as follows:
Sonangol (Operator, 30%), Afentra (24%), M&P (20%), ENI (12%), Somoil
(10%) and NIS-Naftagas (4%).
Block 3/05A (5.33%)
Block 3/05A, which is located adjacent to Block 3/05, contains the undeveloped
discoveries Punja, Caco and Gazela with an estimated in place resource of 0.3
billion barrels. The 2C resources estimated by Afentra is 33 mmbo. From 2015
circa two years of production from the Gazela field via a single well and
fields supported by Block 3/05 infrastructure was undertaken. Approximately 2
million barrels were recovered prior to a wellbore driven shut down. There is
currently no production from the Block 3/05A fields. Assessments to define an
optimal development framework of these fields benefitting from the use of the
nearby Block 3/05 facilities and infrastructure is ongoing.
Post completion of the Acquisition and subject to final approval of the
distribution of the CSI interest, the JV will be comprised as follows:
Sonangol (Operator, 33.33%), M&P (26.67%), ENI (16%), Somoil (13.33%),
Afentra (5.33%) and NIS-Naftagas (5.33%).
Block 23 (40%)
Block 23 is a 5,000 km(2) exploration and appraisal block located in the
Kwanza basin in water depths from 600 to 1,600 meters and has a working
petroleum system. Whilst the large block is covered by modern 3D and 2D
seismic data sets, with no outstanding work commitments remaining, the
majority of the block remains under-explored.
The block contains the Azul oil discovery, the first deepwater pre-salt
discovery in the Kwanza basin. This discovery made in carbonate reservoirs has
oil in place of around 150 mmbo and tested at flow rates of around 3,000 -
4,000 bopd of light oil.
Post completion of the Acquisition, the JV is expected to be comprised of:
Namcor, Sequa and Petrolog (40% and operator); Afentra (40%) and Sonangol
(20%).
Somaliland
Somaliland offers one of the last great opportunities to target an undrilled
onshore rift basin in Africa. The Odewayne block, with access to Berbera
deepwater port less than a 100km to the north, is ideally located to
commercialise any discovered hydrocarbons.
Odewayne Block (34%)
This large, unexplored, frontier acreage position covers 22,840km.(2) The
Odewayne PSA is in the Third Period (further extended through the 8th deed of
amendment) with a 1,000km, 10km by 10km 2D seismic grid acquired in 2017 by
BGP (this data was reprocessed in 2019 and is currently being reviewed).
In 2H 2022 the Company will work alongside the Operator in developing an
appropriate forward work program to further evaluate the prospectivity of the
licence. The Company's 34% working interest in the PSA is fully carried by
Genel Energy Somaliland Limited for its share of the costs of all exploration
activities during the Third and Fourth Periods of the PSA.
Outlook on buy and build strategy
Afentra is leveraging its extensive regional experience and network to deliver
significant value. The initial transactions have established a foothold in
Angola with our acquisition of Block 3/05 and 3/05A and provide a strong
foundation for future growth and consolidation in Angola. Blocks 3/05 and
3/05A are long-life production and development assets with low decline rate,
material upside and future short-cycle developments, alongside reducing
emission profiles. Screening assets continues across West Africa and we see
similar scale and larger operated and non-operated opportunities onshore and
offshore and an opportunity for new credible and responsible operators.
Financial Review
Selected financial data
1H 2022 1H 2021 FY 2021
Cash and cash equivalents net to Group ($m) 27.1 40.8 37.7
Restricted Funds 8.0 - -
Adjusted EBITDAX(1) ($m) (1.2) (1.5) (2.0)
Loss after tax ($m) (2.9) (2.4) (5.0)
Debt ($m) - - -
Share price (at period end) (GBP pence) 14.6 15.0 14.6
(1)Adjusted EBITDAX is calculated as earnings before interest, taxation,
depreciation, amortisation, impairment, pre-licence expenditure, provisions
and share-based payments.
Loss from operations
The loss from operations for 1H 2022 was $2.9 million (1H 2021: loss $2.5
million).
During the period, net administrative expenditure increased to $2.9 million
(1H 2021: $2.5 million) predominantly as a result of costs relating to the
Angolan Acquisitions and its associated workstreams ($611k). Pre-licence costs
for 1H 2022 was $1.6m (1H 2021: $862k).
Adjusted EBITDAX and loss after tax
Adjusted EBITDAX totalled a loss of $1.2 million (1H 2021: loss 1.5 million).
Finance income of $2k represents interest received on cash held by the Group
(1H 2021: $46k).
Finance costs totalled $73k (1H 2021: $23k).
The loss after tax totalled $2.9 million (1H 2021: loss $2.4 million). Basic
loss per share was 1.34 US¢ per share (1H 2021: 1.11 US¢ loss per share). No
dividend is proposed to be paid for the six months to 30 June 2022 (30 June
2021: nil).
Cash flow
Net cash outflow from operating activities (pre-working capital movements)
totalled $2.8 million (1H 2021: outflow $2.3 million). After working capital,
net cash outflow from operating activities totalled $2.5 million (1H 2021:
outflow $1.8 million). During the period the Company provided a bank guarantee
(issued by Nedbank Limited) to Sonangol, in respect of the Sonangol
Acquisitions, detailed in Note 4.
Statement of financial position
At 30 June 2022, Afentra held $27.1 million cash and cash equivalents (30 June
2021: $40.8 million) and restricted funds of $8.0 million.
Group net assets at 30 June 2022 were $55.9 million (30 June 2021 were $61.4
million). Non-current assets totalled $21.8 million (30 June 2021: $22.0
million) with net current assets reducing to $34.4 million (30 June 2021:
$40.1 million).
Going Concern
The Group's business activities, together with the factors likely to affect
its future development, performance and position is set out above (page 1) and
within the CEO Statement and in the Operations Review. The financial position
of the Group is described in the Financial Review.
The Group has paid deposits in relation to the disclosed transactions detailed
in Note 5, which may not be refundable under certain circumstances but
otherwise currently has no unconditional, legally binding commitments in
relation to such transactions. In the event that these deposits are not
refunded the Group has sufficient cash resources for its working capital needs
for at least the next 12 months.
The Directors remain confident the Group has sufficient cash resources to meet
its liabilities as they fall due for a period of at least 12 months from the
date of signing these financial statements, and notwithstanding the impact
from the current situation in Ukraine and the impact to commodity prices and
foreign exchange rates. As a consequence, the Directors believe that the Group
is in a strong position and thus, they continue to adopt the going concern
basis of in preparing the results for the six months ended 30 June 2022.
Disclaimer
This document contains certain forward-looking statements that are subject to
the usual risk factors and uncertainties associated with the oil and gas
exploration and production business. Whilst the Group believes the expectation
reflected herein to be reasonable in light of the information available to it
at this time, the actual outcome may be materially different owing to factors
either beyond the Group's control or otherwise within the Group's control but
where, for example, the Group decides on a change of plan or strategy.
Accordingly, no reliance may be placed on the figures contained in such
forward-looking statements.
Glossary
$ US Dollars
2D two dimensional
3D three dimensional
Adjusted EBITDAX earnings before interest, taxation, depreciation, amortisation, impairment,
pre-
licence expenditure, provisions and share based payments
AIM Alternative Investment Market of the London Stock Exchange
bopd Barrels of Oil per day
CPR Competent Persons Report
CSI China Sonangol International
ERCE Independent and qualified Reserves and Resources evaluator (CPR)
Group Afentra plc, together with its subsidiary undertakings (the 'Group')
INA Industrija Nafte, d.d
km kilometre
mmbo million Barrels of Oil
Petrosoma Petrosoma Limited (JV partner in Somaliland)
PSA production sharing agreement
Seismic Geophysical investigation method that uses seismic energy to interpret the
geometry of rocks in the subsurface
Sonangol Sonangol Pesquisa e Produção S.A.
km(2) square kilometre
WI working interest
Condensed consolidated income statement for the six months to 30 June 2022
Six months to Six months to Year ended
30th June 2022 30th June 2021 31st December 2021
$000 $000 $000
(unaudited) (unaudited) (audited)
Other administrative expenses (1,301) (1,605) (2,249)
Pre-licence costs (1,574) (862) (2,734)
Total administrative expenses (2,875) (2,467) (4,983)
Loss from operations (2,875) (2,467) (4,983)
Finance income 2 46 36
Finance expense (73) (23) (45)
Loss before tax (2,946) (2,444) (4,992)
Tax - - -
Loss for the period attributable to the owners of the parent (2,946) (2,444) (4,992)
Other comprehensive expense - items to be
reclassified to the income statement in subsequent periods
Currency translation adjustments (21) (5) (5)
Total comprehensive expense for the period (21) (5) (5)
Total comprehensive expense for the period attributable to the owners of the (2,967) (2,449) (4,997)
parent
Basic and diluted loss per share (US cents) (1.3) (1.1) (2.3)
Condensed consolidated statement of financial position as at 30 June 2022
As at As at As at
Note 30th June 2022 30th June 2021 31st December 2021
$000 $000 $000
(unaudited) (unaudited) (audited)
Non-current assets
Intangible exploration and evaluation assets 3 21,305 21,252 21,289
Property, plant and equipment 542 746 725
21,847 21,998 22,014
Current assets
Trade and other receivables 290 228 288
Cash and cash equivalents 27,096 40,772 37,727
Restricted Funds 4 8,000 - -
35,386 41,000 38,015
Total assets 57,233 62,998 60,029
Equity
Share capital 28,143 28,143 28,143
Currency translation reserve (223) (202) (202)
Retained earnings 28,007 33,501 30,953
Total equity 55,927 61,442 58,894
Current liabilities
Trade and other payables 836 825 518
Lease liability 111 120 234
947 945 752
Non-current liabilities
Lease liability 327 576 347
Long-term provision 32 35 36
359 611 383
Total liabilities 1,306 1,556 1,135
Total equity and liabilities 57,233 62,998 60,029
Condensed consolidated statement of changes in equity for the six months ended 30 June 2022
Currency
Share translation Retained
capital reserve earnings Total
$000 $000 $000 $000
At 1 January 2021 28,143 (197) 35,945 63,891
Total comprehensive expense for the period attributable to the owners of the - (5) (2,444) (2,449)
parent
At 30 June 2021 28,143 (202) 33,501 61,442
Total comprehensive expense for the period attributable to the owners of the - - (2,548) (2,548)
parent
At 31 December 2021 28,143 (202) 30,953 58,894
Total comprehensive expense for the period attributable to the owners of the - (21) (2,946) (2,967)
parent
At 30 June 2022 28,143 (223) 28,007 55,927
Condensed consolidated statement of cash flows for the six months ended 30 June 2022
Six months to Six months to Year ended
Note 30th June 2022 30th June 2021 31st December 2021
$000 $000 $000
(unaudited) (unaudited) (audited)
Operating activities:
Loss before tax (2,946) (2,444) (4,992)
Depreciation, depletion & amortisation 119 119 241
Finance income and gains (2) (46) (13)
Finance expense and losses 15 23 45
Operating cash outflow prior to working capital movements (2,814) (2,348) (4,719)
Increase in trade and other receivables (2) (35) (95)
Increase in trade and other payables 318 616 309
(Decrease)/increase in provision (4) 1 2
Net cash outflow from operating activities (2,502) (1,766) (4,503)
Investing activities
Interest received 2 11 13
Purchase of property, plant and equipment (1) (9) (127)
Exploration and evaluation costs 3 (16) (43) (80)
Net cash used in investing activities (15) (41) (194)
Financing activities
Principal paid on lease liability (99) (121) (234)
Interest paid on lease liability (14) (20) (39)
Increase in restricted funds 4 (8,000) - -
Net cash used in financing activities (8,113) (141) (273)
Net decrease in cash and cash equivalents (10,630) (1,948) (4,970)
Cash and cash equivalents at beginning of period 37,727 42,674 42,674
Effect of foreign exchange rate changes (1) 46 23
Cash and cash equivalents at end of period 27,096 40,772 37,727
Notes to the consolidated results for the six months ended 30 June 2022
1. Basis of preparation
The financial information contained in this announcement does not constitute
statutory financial statements within the meaning of Section 435 of the
Companies Act 2006.
The financial information for the six months ended 30 June 2022 is unaudited.
In the opinion of the Directors, the financial information for this period
fairly represents the financial position of the Group. Results of operations
and cash flows for the period are in compliance with International Financial
Reporting Standards (IFRSs). The accounting policies, estimates and judgements
applied are consistent with those disclosed in the annual financial statements
for the year ended 31 December 2021. These financial statements should be read
in conjunction with the annual financial statements for the year ended 31
December 2021. All financial information is presented in USD, unless otherwise
disclosed.
An unqualified audit opinion was expressed for the year ended 31 December
2021, as delivered to the Registrar.
The Directors of the Company approved the financial information included in
the results on 27 September 2022.
2. Results & dividends
The Group has retained earnings at the end of the period of $28.0 million (30
June 2021: $33.5 million retained earnings) to be carried forward. The
Directors do not recommend the payment of a dividend (1H 2021: nil).
3. Intangible exploration and evaluation (E&E)
assets
Group intangible assets:
Total
$000
(unaudited)
Net book value at 31 December 2020 21,209
Additions during the period 43
Net book value at 30 June 2021 21,252
Additions during the period 38
Net book value at 31 December 2021 21,289
Additions during the period 16
Net book value at 30 June 2022 21,305
Odewayne PSA, Somaliland: A(EA)L 34%, Genel Energy Somaliland Limited 50%,
Petrosoma 16%.
4. Restricted Funds
The Company has provided a bank guarantee issued by Nedbank Limited to
Sonangol in respect of a $8.0 million cash deposit in respect of the Sonangol
Acquisitions that would otherwise have been required to be paid shortly after
the signing of the Sonangol Acquisition Agreement. This guarantee has been
fully cash collateralised by the Company.
5. Subsequent Events
During the Period (28th April 2022) Afentra plc announced that its
wholly-owned subsidiary, Afentra (Angola) Ltd, had signed a Sale and Purchase
Agreement with Sonangol to purchase interests in Block 3/05 and Block 23,
offshore Angola.
On the 19th July 2022 Afentra plc announced that its wholly-owned subsidiary,
Afentra (Angola) Ltd, had signed a Sale and Purchase Agreement with INA to
acquire a 4% interest in Block 3/05 and a 5.33% interest in Block 3/05A,
offshore Angola.
On the 10th August 2022 Afentra plc published its Admission Document in
relation to the acquisitions and Notice of General Meeting. The resolution to
approve the Acquisitions was passed as an ordinary resolution by the requisite
majority at the general meeting, held on the 30th August 2022.
The Group has paid deposits in relation to the transactions, which may not be
refundable under certain circumstances but otherwise currently has no
unconditional, legally binding commitments in relation to such transactions.
The next steps in the process contain a number of conditions precedent that
will need to be satisfied or waived before the Acquisition can be completed.
There is, however, no guarantee at this stage that the Acquisition will be
completed.
The measurement of expected credit losses in accordance with IFRS 9 (Financial
Instruments), are not impacted by subsequent global developments related to
the situation in Ukraine and the impact to commodity prices and foreign
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