REG-Cadogan Petroleum: Half Yearly Report for the Six Months ended 30 June 2016 <Origin Href="QuoteRef">CADP.L</Origin> - Part 2

Cadogan Energy SolutionsAnnouncement

25/08/2016 17:25

- Part 2: For the preceding part double click  ID:nPRrP5587a 

7.         Inventories

The Group had significant volumes of natural gas as at 31 December 2015 which
have been sold during the six months ended 30 June 2016 that resulted in a
reduction of the natural gas balance from $2.5 million to $1.2 million.

8.         Trade and other receivables

                                            Six months ended 30 June  Year ended 31 December 
                                          2016 $ ’000    2015 $ ’000             2015 $ ’000 
 Trading receivables                            2,662          1,558                   1,824 
 Receivable from joint-ventures                 2,412          4,238                   8,514 
 VAT recoverable                                1,466          1,358                       - 
 Prepayments                                      148             96                      64 
 Trading prepayments                               53            893                   3,206 
 Other receivables                                402            752                     803 
                                                7,143          8,895                  14,411 

The Directors consider that the carrying amount of the other receivables
approximates their fair value and none of which are past due.

Management expects to realise VAT recoverable through the activities of the
business segments.

9.     Short-term borrowings

In 2016 the Group continued to use short-term borrowings as a financing
facility for its trading activities. Borrowings are represented by a credit
line drawn in UAH at a Ukrainian bank, a 100% subsidiary of a European bank.
The credit line is secured by $20 million of cash balance placed at a European
bank in the UK.

During the six months ended 30 June 2016 the Group repaid a significant amount
of the credit line and the outstanding amount as at 30 June 2016 was $7.5
million (30 June 2015: $5.7 million, 31 December 2015: $12.9 million) with
effective interest rate of 19.75% p.a (H1 2015: 24% p.a.). Interest is paid
monthly and as at 30 June 2016 the accrued interest amounted to $0.2 million
(30 June 2015: $0.1 million, 31 December 2015: $0.2 million). The $4.0 million
outstanding as of 25 August 2016 represents UAH 100.0 million borrowed in UAH
to purchase gas.

10.  Trade and other payables

The $1.3 million of trade and other payables as of 30 June 2016 (30 June 2015:
$8.4 million, 31 December 2015: $4.6 million) represent $0.9 million (30 June
2015: $7.3 million, 31 December 2015: $4.0 million) of other creditors and
$0.4 million of accruals (30 June 2015: $1.1 million, 31 December 2015: $0.6
million).

11.  Related party transactions

Transactions between the Group and its subsidiaries, which are related
parties, have been eliminated on consolidation and are not disclosed in this
note. The application of IFRS 11 has resulted in the existing joint ventures
LLC Astroinvest-energy, LLC Gazvydobuvannya and LLC Westgasinvest, being
accounted for under the equity method and disclosed as related parties. During
the period, Group companies entered into the following transactions with
related parties who are not members of the Group:

                                                                   Six months ended 30 June  Year ended 31 December 
                                                                 2016 $ ’000    2015 $ ’000             2015 $ ’000 
    Revenues from services provided and sales of goods                 1,272            350                     508 
    Purchases of goods                                                   117             28                       9 
    Amounts owed by related parties                                    2,412          1,558                   1,824 
    Amounts owed to related parties                                      234            148                      96 

The amounts outstanding are unsecured and will be settled in cash. No
provisions have been made for doubtful debts on the amounts owed by related
parties.

12.  Post balance sheet events

On 10 August 2016 the Pokrovskoe licence expired.

13.  Commitments and contingencies

There have been no significant changes to the commitments and contingencies
reported on page 71 of the Annual Report.




 

 1  As of January 1, 2016 the harsh 70 % subsoil use tax for gas has remained
in force only for licenses operated under Joint Activity Agreements,
Debeslavetska and  Cheremkhivsk production licences fall into this category.

 2  This amount is held into an account with BNP Paribas in the  UK and
backs-up  a credit line in Ukraine used for trading.

1 WGI is a Ukraine registered company in which Cadogan owns a 15 %
participating interest; the remaining participating interest is held by eni
ukraine LLC (50.01 %) and Nadra Ukrayny (34.99 %)



Copyright (c) 2016 PR Newswire Association,LLC. All Rights Reserved