REG - Chariot Limited - H1 2022 Results
14/09/2022 07:00
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RNS Number : 3479Z Chariot Limited 14 September 2022
14 September 2022
Chariot Limited
("Chariot", the "Company")
H1 2022 Results
Chariot (AIM: CHAR), the Africa focused transitional energy company, today
announces its unaudited interim results for the six-month period ended 30 June
2022.
· Significant gas discovery at the Anchois-2 well offshore Morocco
· Material increase in gas resources within a basin scale
opportunity
· Rissana Offshore exploration licence awarded in Morocco
· Two new renewable energy projects in development in South Africa
and Zambia
· Pre-Feasibility Study ('PFS') completed on Project Nour in
Mauritania confirming world class green hydrogen potential
· Partnership signed with Total Eren to co-develop Project Nour
· Oversubscribed Placing and Open Offer raised gross US$29.5m
Adonis Pouroulis, CEO of Chariot commented: "It is a pleasure to report on our
activities in the first half of 2022, as we delivered significant progress
across all areas of our business. It has been a busy time but our focus
remains on securing and developing large-scale, scalable, first-mover
positions in projects that can diversify the energy mix, potentially reduce
carbon emissions, support greener industrial development and facilitate access
to affordable, accessible energy for all. In delivering this strategy, we are
looking to play a material role in the energy transition whilst creating value
and generating a wide range of positive impacts for all stakeholders. As we
advance our three pillar strategy across our gas, power and hydrogen
businesses, we are building a unique position within the transitional energy
space and look forward to updating all our stakeholders on the next phases of
our journey."
Highlights during and post period
Transitional Gas: Anchois Gas Development Project
· Successful drilling campaign completed safely and on budget in
January 2022.
· The Anchois-2 well reported a significant gas discovery, with
o 150m net pay confirmed across seven reservoirs
o confirmation of consistent and excellent quality dry gas composition across
all reservoirs, which should enable a conventional and common development.
· Independent assessment confirmed a significant upgrade in gas
resources - increased to 1.4 Tcf in total remaining recoverable (2C plus 2U)
at the Anchois Project.
· Societe Generale appointed as financial advisor to lead the project
financing.
· Front end engineering design ("FEED") awarded to Schlumberger and
Subsea7 ("Subsea Integration Alliance")
· Agreement with ONHYM to tie-in to the Maghreb-Europe Gas Pipeline
("GME")
Material Upside Potential
· Anchois-2 drilling success directly de-risked a material portfolio of
prospects within the Lixus licence area.
· Rissana Offshore Licence signed in February 2022 capturing gas play
extensions from the Lixus licence and prospects from our legacy Mohammedia
licence area.
· Early assessment of areas covered by 3D seismic, estimates a total 2U
prospective resource in Rissana of over 7Tcf.
Transitional Power: Renewable Energy for Mining Projects
· Partnership with Total Eren extended from January 2022 with Chariot
having the right to invest up to 49% into the co-developed mining projects.
· Two projects signed during the period and in development:
o 40MW solar PV project with Tharisa Plc to provide power to its chrome and
PGM operations in South Africa.
o Partnership with First Quantum Minerals to advance the development of a
430 MW solar and wind power project for its copper mining operations in Zambia
- one of the largest renewable private sector energy projects in Africa.
· Building up a pipeline of African mining power projects and looking
to collaborate on other renewable transactions across the continent.
Green Hydrogen - Project Nour
· Pre-Feasibility Study ("PFS") confirmed Mauritania is exceptionally
well-placed for green hydrogen production due to its solar and wind resources.
o Project Nour could produce some of the cheapest green hydrogen in the
world.
· 50%/50% Partnership agreement signed with Total Eren to co-develop
the project, progressing the in-depth feasibility study and offtake options.
· Wide ranging potential benefits for domestic, infrastructure and
energy industries within Mauritania.
· MoU signed with the Port of Rotterdam International, a global energy
hub and Europe's largest seaport which represents a first step towards
establishing supply chains.
· Ongoing initiatives to expand the portfolio and evaluate further
green hydrogen opportunities.
Corporate
· Well capitalised business - further reinforced following a
successful fundraise in June 2022.
· Cash position as at 30 June 2022 - $23.4million with no debt with
minimal licence commitments.
Enquiries:
Chariot Limited +44 (0)20 7318 0450
Adonis Pouroulis, CEO
Julian Maurice-Williams, CFO
Cenkos Securities Plc (Nomad and Joint Broker) +44 (0)20 7397 8900
Derrick Lee, Adam Rae
Peel Hunt LLP (Joint Broker)
Richard Crichton, David McKeown +44 (0) 20 7894 7000
Celicourt Communications (Financial PR) +44 (0)20 8434 2754
Mark Antelme, Jimmy Lea
Chariot Limited
Chief Executive's Review
Climate change and the tumultuous events that have unfolded in Eastern Europe
this year have reinforced the reality that energy security and sustainability
remain at the forefront of global agendas and we are fully focused on
developing and delivering on our transitional energy projects, all of which
have the potential to play a material role within this context. I am delighted
to report on our progress over the first half of 2022, as we have
significantly increased our natural gas resources and are moving towards FID
at the Anchois Gas Project offshore Morocco. In addition, over this period we
added two major projects to our renewable power pipeline in Southern Africa
and delivered on our objective of securing a world class partner in Total Eren
to co-develop our large-scale green hydrogen asset in Mauritania.
Transitional Gas
The Anchois Development Project
Our successful drilling campaign and significant gas discovery at the Anchois
gas field offshore Morocco has been well documented since the beginning of
this year, the results from which exceeded expectations, confirmed the
consistency and quality of the gas and reported an upgrade to net pay
estimates as well as a material increase in gas resources. We were pleased to
have our in-house analysis corroborated by Netherland Sewell & Associates
Inc which confirmed upgrades to the 2C and 2U resources as well as the basin
scale opportunity that sits within our acreage providing further material
upside to both Anchois and Lixus.
We are now developing a significant project which has 1.4 Tcf in 2C plus 2U
total recoverable resources at Anchois and our team is fully focused on the
FEED elements of the development plan, working alongside Schlumberger and
Subsea 7 who we appointed in June. With Societe Generale leading the project
financing, a Tie-In agreement signed with OHNYM post-period end providing
access to the major Maghreb Europe Gas pipeline, ongoing offtake and strategic
partnering discussions and our Environmental and Social Impact Assessment
underway, we are looking to reach FID as soon as possible to start generating
material cash flows thereafter.
Material Upside Potential
The exploration and appraisal drilling also served to derisk a range of
targets, both in the Lixus licence where Anchois is located and also in
surrounding acreage in the Rissana licence which we signed in February 2022.
Early assessment of the areas in Rissana covered by 3D seismic, provides a
total 2U prospective resource of over 7 Tcf, combining a high-graded prospect
'Emissole' within the lower risk Anchois Tertiary gas play and multi Tcf
prospects in a higher-risk Mesozoic play, inherited from Chariot's legacy
Mohammedia Offshore licence area.
We are committed to developing and realising the value of this gas field and
moving it into production to help meet the growing demand within Morocco's
domestic market as well as potentially supplying surplus gas to Europe.
Transitional Power
Providing Renewable Power in Africa
Our Transitional Power business is focused on providing innovative energy
solutions for mining and industrial offtakers across the African continent in
order to reduce costs, improve ESG performance, and deliver reliable and
low-risk energy supplies. Working alongside Total Eren our team has continued
to leverage their expertise and network securing two substantial new projects
within the first half of the year with a 40MW solar plant now in development
at Tharisa's PGM and chrome mine in South Africa, and a 430 MW solar and wind
partnership underway at First Quantum's Kansanshi copper gold mine in Zambia.
Both projects are flagship initiatives within these countries and will follow
a similar development path to that of IAMGold's exemplary operational 15GW
solar project at the Essakane gold mine in Burkina Faso, our first renewable
project in which we hold a 10% stake.
The power demand of the mining sector offers huge scale and growth potential
but we are also looking at other opportunities that stem from wider energy
needs and scarcity of resources in some regions across Africa. We have the
team and the flexibility to access and evaluate a range of options and we will
consider all those that would be value accretive and fit within our
Transitional Power remit and strategy. Considering that our Power business is
only just over a year old, we have grown rapidly over this last period and we
are just beginning the journey. There are huge opportunities in which Chariot
can play a leading role in Africa's energy transition.
Green Hydrogen - an essential part of the future energy mix
We are delighted to have partnered with Total Eren in Mauritania to co-develop
Project Nour, which with the potential to install 10GW of electrolyser
capacity, could become one of the most significant green hydrogen projects in
Africa. We share a similar vision for green hydrogen seeing it as a key
component in diversifying the energy mix and a vital energy source of the
future and our teams have complementary skillsets that we bring to this
project. The partnership will be a 50%/50% split, and we will be working
together to progress the in-depth feasibility study and offtake options.
Chariot will continue to co-lead on project development and permitting, local
content, and stakeholder engagement and the project will undoubtedly benefit
from Total Eren's range of expertise and engineering knowledge. As confirmed
by the PFS, this could become one of the most competitive green hydrogen
projects in the world due to the abundance of natural resources and could
bring a range of sustainable economic benefits to Mauritania including greener
industry opportunities and provision of clean power to the national grid. It
could also potentially result in the country becoming one of the world's main
producers and exporters of green hydrogen, providing a cost-effective,
transportable energy solution to replace CO(2) emitting fuels for exportation
to the European market.
We are very pleased to have secured a first mover advantage and are keen to
expand our footprint within this fast moving and critical sector. We will
continue to evaluate opportunities in this space and look forward to
collaborating on new ventures with Total Eren in the future.
Financial Review
The Group remains debt free and had a cash balance of US$23.4 million at 30
June 2022 (US$19.4 million at 31 December 2021) following the equity
fundraising completed in June 2022 which raised gross proceeds of US$29.5
million.
Hydrogen and other business development costs of $1.5m (30 June 2021: $nil)
comprise non-administrative expenses incurred in the development of
Transitional Power and Hydrogen projects following the acquisitions made in
June 2021.
Other administrative expenses of US$5.0 million (30 June 2021: US$1.7 million)
are higher than the prior period driven by one-off new venture and employment
costs and the inclusion of administration costs from the Transitional Power
acquisitions.
Finance expenses of US$0.4 million (30 June 2021: US$0.3 million) reflect
foreign exchange losses on the holding of cash balances in Sterling to meet
administrative and capital expenditures, in addition to the unwinding of the
discount on the lease liability under IFRS 16.
Share-based payments charges of US$0.9 million (30 June 2021: US$0.2 million)
are higher than the prior period due to the granting of share awards to
employees across the group, including employees joining the group as part of
the Transitional Power acquisition.
Outlook
Looking forward, we are enthused with both the evolution and revolution taking
place within our business, especially when I look at the projects we offer and
what the future might hold for the Company. We are excited about the path
forward with our gas development project at Anchois, fast tracking all
workstreams to reach FID and deliver a valuable resource to energy hungry
customers. Within our Transitional Power business, we will continue to develop
our mining project pipeline across the continent as well as potentially
broadening our portfolio and with Green Hydrogen we look forward to further
unlocking the scale of this nascent but important commodity. Our business has
three pillars, gas, power and hydrogen, which offer a range of significant,
scalable resources underpinned by expanding markets and fundamental objectives
of looking to create value and deliver positive change. As a management team,
we remain closely aligned with our shareholder base and we look forward to
providing further updates on our continued progress and development over the
coming months.
A Pouroulis
Chief Executive Officer
14 September 2022
Chariot Limited
Consolidated statement of comprehensive income for the six months ended 30
June 2022
Six months Six months Year ended
ended 30 ended 30 31 December
June 2022 June 2021 2021
US$000 US$000 US$000
Notes Unaudited Unaudited Audited
Share based payments (938) (26) (760)
Hydrogen and other business development costs (1,463) (1,139)
Other administrative expenses (4,970) (1,655) (4,549)
Total operating expenses (7,371) (1,681) (6,448)
Loss from operations (7,371) (1,681) (6,488)
Finance expense (390) (329) (512)
Loss for the period before and after taxation (7,761) (2,010) (6,960)
Loss for the period and total comprehensive loss for the period attributable (7,761) (2,010) (6,960)
to equity owners of the parent
Loss per ordinary share attributable to the equity holders of the parent - 3 US$(0.01) US$(0.01) US$(0.01)
basic and diluted
Chariot Limited
Consolidated statement of changes in equity for the six months ended 30 June
2022
For the six months ended 30 June 2022 (unaudited) Share based payment reserve Shares based to be issued reserve Total attributable to equity holders of the parent
Share capital Share premium Contributed equity Retained deficit
US$000 US$000 US$000 US$000 US$000 US$000 US$000
As at 1 January 2022 11,696 383,318 796 2,207 142 (359,199) 38,960
Loss and total comprehensive loss for the period - - - - - (7,761) (7,761)
Issue of capital 2,541 31,892 - - - - 34,433
Issue costs - (1,618) - - - - (1,618)
Share based payments - - - 938 - - 938
As at 30 June 2022 14,237 413,592 796 3,145 142 (366,960) 64,952
For the six months ended 30 June 2021 (unaudited) Share based payment reserve Total attributable to equity holders of the parent
Shares to be issued reserve
Share capital Share premium Contributed equity Retained deficit
US$000 US$000 US$000 US$000 US$000 US$000 US$000
As at 1 January 2021 6,549 359,609 796 1,447 - (352,239) 16,162
Loss and total comprehensive loss for the period - - - - - (2,010) (2,010)
Issue of capital 3,491 15,666 - - - - 19,157
Issue costs - (1,241) - - - - (1,241)
Share based payments - - - 26 - - 26
Share based deferred consideration - - - - 142 - 142
As at 30 June 2021 10,040 374,034 796 1,473 142 (354,249) 32,236
For the year ended 31 December 2021 (audited) Share based payment reserve Total attributable to equity holders of the parent
Shares to be issued reserve
Share capital Share premium Contributed equity Retained deficit
US$000 US$000 US$000 US$000 US$000 US$000 US$000
As at 1 January 2021 6,549 359,609 796 1,447 - (352,239) 16,162
Loss and total comprehensive loss for the year - - - - - (6,960) (6,960)
Issue of capital 5,147 25,585 - - - - 30,732
Issue costs - (1,876) - - - - (1,876)
Share based payments - - - 760 - - 760
Share based deferred consideration - - - - 142 - 142
As at 31 December 2021 11,696 383,318 796 2,207 142 (359,199) 38,960
Chariot Limited
Consolidated statement of financial position as at 30 June 2022
30 June 30 June 31 December 2021
2022 2021
US$000 US$000 US$000
Notes Unaudited Unaudited Audited
Non-current assets
Exploration and evaluation assets 4 44,967 13,756 31,750
Investment in power projects 450 450 450
Goodwill 380 380 380
Property, plant and equipment 85 52 84
Right of use asset: office lease 164 492 328
Total non-current assets 46,046 15,130 32,992
Current assets
Trade and other receivables 642 704 1,167
Inventory 1,306 - 1,183
Cash and cash equivalents 5 23,391 18,049 19,406
Total current assets 25,339 18,753 21,756
Total assets 71,385 33,883 54,748
Current liabilities
Trade and other payables 6,244 990 15,358
Lease liability: office lease 189 431 430
Total current liabilities 6,433 1,421 15,788
Non-current liabilities
Lease liability: office lease - 226 -
Total non-current liabilities - 226 -
Total liabilities 6,433 1,647 15,788
Net assets 64,952 32,236 38,960
Capital and reserves attributable to equity holders of the parent
Share capital 6 14,237 10,040 11,696
Share premium 413,592 374,034 383,318
Contributed equity 796 796 796
Share based payment reserve 3,145 1,473 2,207
Shares to be issued reserve 142 142 142
Retained deficit (366,960) (354,249) (359,199)
Total equity 64,952 32,236 38,960
Chariot Limited
Consolidated cash flow statement for the six months ended 30 June 2022
Six months ended 30 Six months ended 30 Year ended 31 December 2021
June 2022 June 2021
US$000 US$000 US$000
Unaudited Unaudited Audited
Operating activities
Loss for the period before taxation (7,761) (2,010) (6,960)
Adjustments for:
Finance expense 390 329 512
Depreciation and amortisation 188 177 358
Share based payments 938 26 760
Net cash outflow from operating activities before changes in working capital (6,245) (1,478) (5,330)
Decrease / (increase) in trade and other receivables 285 38 (116)
Increase / (decrease) in trade and other payables 3,481 (290) 445
Increase in inventories (123) - (1,183)
Cash outflow from operating activities (2,602) (1,730) (6,184)
Net cash outflow from operating activities (2,602) (1,730) (6,184)
Investing activities
Payments in respect of property, plant and equipment (25) (22) (72)
Payments in respect of exploration and evaluation assets (25,572) (793) (5,301)
Net cash consideration on acquisition - (21) (21)
Net cash outflow used in investing activities (25,597) (836) (5,394)
Financing activities
Issue of ordinary share capital net of fees 32,815 17,396 28,175
Payment of lease liabilities (241) (192) (419)
Finance expense on lease (10) (27) (46)
Net cash inflow from financing activities 32,564 17,177 27,710
Net increase in cash and cash equivalents in the period 4,365 14,611 16,132
Cash and cash equivalents at start of the period 19,406 3,740 3,740
Effect of foreign exchange rate changes on cash and cash equivalent (380) (302) (466)
Cash and cash equivalents at end of the period 23,391 18,049 19,406
Chariot Limited
Notes to the interim financial statements for the six months ended 30 June
2022
1. Accounting policies
Basis of preparation
The interim financial statements have been prepared in accordance with UK
adopted International Accounting Standards.
The interim financial information has been prepared using the accounting
policies which were applied in the Group's statutory financial statements for
the year ended 31 December 2021. The Group has not adopted IAS 34: Interim
Financial Reporting in the preparation of the interim financial statements.
There has been no impact on the Group of any new standards, amendments or
interpretations that have become effective in the period. The Group has not
early adopted any new standards, amendments or interpretations.
In the consolidated statement of comprehensive income Other Administrative
expenses has been split out to provide further detail of total operating
expenses. The comparative figures for 30 June 2021 and 31 December 2021 have
been represented to reflect this additional disclosure. There is no change to
the total operating expenses or loss from operations for those periods.
2. Financial reporting period
The interim financial information for the period 1 January 2022 to 30 June
2022 is unaudited. The financial statements also incorporate the unaudited
figures for the interim period 1 January 2021 to 30 June 2021 and the audited
figures for the year ended 31 December 2021.
The financial information contained in this interim report does not constitute
statutory accounts as defined by sections 243-245 of the Companies (Guernsey)
Law 2008.
The figures for the year ended 31 December 2021 are not the Group's full
statutory accounts for that year. The auditors' report on those accounts was
unqualified, did not contain references to matters to which the auditors drew
attention by way of emphasis and did not contain a statement under section 263
(3) of the Companies (Guernsey) Law 2008.
3. Loss per share
The calculation of the basic earnings per share is based on the loss
attributable to ordinary shareholders divided by the weighted average number
of shares in issue during the period.
Six months ended 30 June 2022 Six months ended 30 June 2021 Year ended 31 December 2021
Loss for the period US$000 (7,761) (2,010) (6,960)
Weighted average number of shares 822,031,912 391,409,534 519,854,783
Loss per share, basic and diluted* US$(0.01) US$(0.01) US$(0.01)
*Inclusion of the potential ordinary shares would result in a decrease in the
loss per share and, as such, is considered to be anti-dilutive. Consequently a
separate diluted loss per share has not been presented.
4. Exploration and evaluation assets
30 June 2022 30 June 2021 31 December 2021
US$000 US$000 US$000
Balance brought forward 31,750 12,822 12,822
Additions 13,217 934 18,928
Net book value 44,967 13,756 31,750
As at 30 June 2022 the net book value of the Moroccan geographic area is
US$45.0 million (31 December 2021: US$31.8 million).
5. Cash and cash equivalents
As at 30 June 2022 the cash balance of US$23.4 million (31 December 2021:
US$19.4 million) contains the following cash deposits that are secured against
bank guarantees given in respect of exploration work to be carried out:
30 June 2022 30 June 2021 31 December 2021
US$000 US$000 US$000
Moroccan licences 750 350 5,350
750 350 5,350
The funds are freely transferrable but alternative collateral would need to be
put in place to replace the cash security.
6. Share capital
Allotted, called up and fully paid
At At At At 31 December 2021 31
30 June 2022 30 June 2022 30 June 2021 30 June 2021 December 2021
Number US$000 Number US$000 Number US$000
Ordinary shares of 1p each
958,002,421 14,237 636,077,728 10,040 759,587,023 11,696
Details of the Ordinary shares issued during the six month period to 30 June
2022 are given in the table below:
Date Description Price US$ No of shares
1 January 2022 Opening Balance 759,587,023
31 January 2022 Issue of shares at £0.055 relating to underwriting commitment 0.07 33,742,396
3 March 2022 Issue of shares at £0.055 relating to underwriting commitment 0.07 33,742,396
13 June 2022 Issue of shares at £0.18 in Placing, Subscription, Open Offer and fees 0.22 130,930,606
30 June 2022 958,002,421
The ordinary shares have a nominal value of 1p. The
share capital has been translated at the historic rate at the date of issue,
or, in the case of the LTIP, the date of grant.
Magna Capital LDA (of which Adonis Pouroulis, CEO, has a substantial
interest), underwrote the June 2021 equity fundraising to ensure the total
fundraising equated to approximately US$23 million. Accordingly, 33,742,396
new Ordinary shares were admitted on 31 January 2022 and 33,742,396 new
Ordinary shares were admitted on 3 March 2022 and the Company received
proceeds totalling US$5 million. The underwriting commitment constitutes a
related party transaction.
On 10 June 2022 the Company announced the approval by shareholders at a
General Meeting of an equity fundraising for 130,930,606 new Ordinary Shares
at a price of 18 pence per share. The new Ordinary Shares were admitted on 13
June 2022 and the Company received gross proceeds of US$29.5m.
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