REG - Clontarf Energy PLC - Preliminary Results for the Year Ended 31 Dec 2021
22/06/2022 07:00
For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20220622:nRSV7051Pa&default-theme=true
RNS Number : 7051P Clontarf Energy PLC 22 June 2022
22 June 2022
Clontarf Energy plc
("Clontarf" or "the Company")
Preliminary Results for the Year Ended 31 December 2021
Clontarf Energy, the oil and gas exploration company focused on Ghana, Bolivia
and Australia today announces its preliminary results for the year ending 31
December 2021.
The Company expects to shortly publish its 2021 Annual Report & Accounts
and a further update will be made in this regard as and when appropriate.
This announcement contains inside information for the purposes of Article 7 of
Regulation 596/2014.
For further information please visit http://clontarfenergy.com
(http://clontarfenergy.com) or contact:
Clontarf Energy +353 (0) 1 833 2833
David Horgan, Chairman
John Teeling, Director
Nominated & Financial Adviser +44 (0) 20 7409 3494
Strand Hanson Limited
Rory Murphy
Ritchie Balmer
Broker +44 (0) 207 399 9400
Novum Securities Limited
Colin Rowbury
Financial PR +44 (0) 207 138 3206
BlytheRay
Megan Ray
Teneo +353 (0) 1 661 4055
Luke Hogg
Alan Tyrrell
Ciara Wylie
Chairman's Statement
Our main focus in the period under review was on delivering a high potential
well in a stable jurisdiction. We also increased the pressure for
ratification in our other projects, in anticipation of a recovering farm-out
market, as demand surges while supply is slow to respond.
Adding gas reserves in Australia to feed existing and new LNG (liquefied
natural gas) supplies is critical for Europe and Asia, given 2022's
geopolitical turbulence. The potential structure size was modelled as very
large (a median or P50 of circa 17 trillion cubic feet or 'tcf'), and
estimated probability of success reasonably good (32%) by the standards of
exploration wells - which are generally 1 in 8, and sometimes even-longer odds
in frontier provinces.
Though drilled without incident, and substantially on the schedule, and at the
costs planned, the relatively shallow gas targets were water-wet, and did not
show commercial hydrocarbons. That is the nature of drilling in 2.5km of
rock under 1km of water. There was uncertainty and risk, but also a huge
stratigraphic trap that was going to be drilled.
The deeper Jurassic and Triassic targets, which are closer to the source-rock,
have not yet been drilled. When the dust settles after the Sasanof-1 well,
Clontarf Energy plc and its partners will consider the economics of drilling
the deeper targets, especially the Jurassic Kingsburgh Upper and Lower (each
of which has potentially 2 tcf of gas-in-place). There is also estimated to
be in the mid-depth Triassic Mungaroo Hyperno over one tcf of gas-in-place,
albeit with a higher expected recovery ratio (75%). The review will assess
how the structure size and probabilities of success have been impacted by the
data acquired from recent drilling.
Though the Sasanof-1 well did not intersect hydrocarbons, we retain our
strategy to seek out gas and liquids in Western Australia: originally
North-West Shelf discoveries were considered "stranded gas" because of long
distances to population centres in the south-east across that vast
continent. However, the development of a competitive LNG industry by several
leading players, including our former partners Woodside-BHP, Exxon, Chevron,
Inpex, and others, have transformed LNG into now the major export, by value,
from Western Australia. Almost any likely State Government will be
supportive, because of the many, high-paying jobs in gas & oil, and
particularly mining. Moreover, statements of the recently elected majority
Labour Government (in June 2022) confirmed the Australian Federal Government's
commitment to the LNG and minerals' industries. Legal title is secure, the
court system is independent and tax rates are reasonable (a windfall tax
having been considered and rejected).
It is important to note that funding for the Sasanof-1 well (£3.5 million)
was provided by local Australian investors who invested at a 25% premium to
the then bid price of our shares (when the funding process began). We
believed that we would struggle to raise such funding from traditional London
investors, while institutional investors might expect a discount for a
strategy to seek out opportunities without having a defined investment.
Accordingly, we are now evaluating further Australian prospects, in addition
to the deeper prospects on WG-519-P. These include additional offshore
prospects acquired by our partners Western Gas from the original Hess
portfolio (on which Hess had invested circa $1.5 billion, before pulling out
in the oil-price depression of 2015, in order to concentrate on the mega
Guyana discoveries, as part of a widespread industry restructuring). There
are also interesting onshore plays - especially in the Canning basin - which
have been neglected due to the oil majors' focus on offshore opportunities.
Just one of the offshore gas targets Clontarf is review is estimated to
contain a potential gas-in-place of 5 tcf, with a potential 3 tcf recoverable,
while 5 prospects - of Jurassic and Triassic ages - have potentially over 3
tcf of gas-in-place. These are tempting sizes at a time of hunger for
feedstock to supply expanding LNG facilities.
We believe that additional funds will be available, possibly again at a
premium to the current share price.
Although the Sasanof-1 well was water-wet, the Australian gas play remains
excellent, with a world LNG shortage, high gas prices - as well as pro-mining
policies, legal title, and reasonable fiscal terms.
Clontarf Energy is also pressing the Ghanaian authorities to complete the
ratification of the signed Petroleum Agreement on offshore Tano 2A Block and
is discussing with the relevant authorities in Chad on how to convert
Clontarf's signed Memorandum of Understanding on prospective sedimentary
acreage, close to existing infrastructure in southern Chad, in a manner
consistent with corporate governance. Progress on these promising projects
had been slowed by the virtual disappearance of the farm-out market after
2014. It made little sense to commit to a substantial work programme,
without a reasonable prospect of de-risking through partnering with companies
with deeper pockets.
As expected, demand for lithium, specifications and lithium prices have
surged. In Bolivia we hope to conclude a Technical Cooperation Agreement on a
systematic mapping exercise shortly. Clontarf Energy did not participate in
the pilot plant testing of Direct Lithium Extraction technologies in Bolivia,
since Clontarf is a user of such services rather than a services provider.
Our proposal is to explore and develop mid-sized Bolivian lithium
salt-lakes.
Clontarf Energy maintains cordial communications with the relevant authorities
in all these countries, despite personnel changes and prevailing
circumstances, and continues to operate efficiently on minimal overheads.
Corporate - share capital reorganisation
To provide maximum flexibility with regards to future funding we are proposing
to change the nominal value of existing shares from 0.25p to 0.01p per
ordinary share and 0.24p deferred share as set out in Resolution 5 (and
Resolution 6) in the notice of the Company's forthcoming Annual General
Meeting. This has no impact on the market value of existing shares or the
number of shares in issue.
This process is effected as follows, subject to Shareholder approval being
given for both Resolution 5 and 6:
Each of the 2,370,826,117 issued ordinary shares of 0.25 pence each in the
capital of the Company ("Existing Ordinary Shares") and any unissued ordinary
shares of 0.25 pence each in the capital of the Company are subdivided into
one new Ordinary Share of 0.01 pence each ("New Ordinary Shares") and one
deferred share of 0.24 pence each ("Deferred Shares") on the basis of one New
Ordinary Share and one Deferred Share for each Existing Ordinary Share; and
The New Ordinary Shares will have the same rights and be subject to the same
restrictions (save as to nominal value) as the Existing Ordinary Shares in the
Company's Articles of Association and the Deferred Shares will have the rights
and be subject to the restrictions as set out in the Articles of Association
as amended by Resolution 6.
David Horgan
Chairman
21 June 2022
CLONTARF ENERGY PLC
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2021
2021 2020
£ £
Administrative expenses (401,427) (361,308)
Impairment of exploration and evaluation assets (62,074) -
Loss from operations (463,501) (361,308)
Income tax expense - -
Total comprehensive income (463,501) (361,308)
Earnings per share attributable to the ordinary equity holders of the parent 2021 2020
Pence Pence
Loss per share - basic and diluted (0.06) (0.05)
CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER 2021
2021 2020
£ £
Assets
Non-current assets
Intangible assets 868,043 915,117
Current assets
868,043 915,117
Other receivables 1,934 1,786
Cash and cash equivalents 344,253 89,423
346,187 91,209
Total assets 1,214,230 1,006,326
Liabilities
Current liabilities
Trade and other liabilities 1,485,848 1,366,707
Total liabilities 1,485,848 1,366,707
Net liabilities (271,618) (360,381)
Issued capital and reserves attributable to owners of the parent
Share capital 2,177,065 1,792,450
Share premium reserve 10,985,758 10,900,373
Share based payment reserve 186,143 103,879
Retained deficit (13,620,584) (13,157,083)
TOTAL EQUITY (271,618) (360,381)
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2021
Share Share Share Retained Total Equity
Capital Premium Based Deficit £
£ Reserve Payment £
£ Reserve
£
At 1 January 2021 1,792,450 10,900,373 103,879 (13,157,083) (360,381)
Issue of share capital 384,615 115,385 - - 500,000
Share issue expenses - (30,000) (30,000)
Share based payment charge - - 82,264 - 82,264
Total comprehensive loss for the year - - - (463,501) (463,501)
At 31 December 2021 2,177,065 10,985,758 186,143 (13,620,584) (271,618)
Share Share Share Retained Total Equity
Capital Premium Based Deficit £
£ Reserve Payment £
£ Reserve
£
At 1 January 2020 1,792,450 10,900,373 21,615 (12,795,775) (81,337)
Share based payment charge - - 82,264 - 82,264
Total comprehensive loss for the year - - - (361,308) (361,308)
At 31 December 2020 1,792,450 10,900,373 103,879 (13,157,083) (360,381)
Share premium
The share premium reserve comprises of a premium arising on the issue of
shares. Share issue expenses are deducted against the share premium reserve
when incurred.
Share based payment reserve
The share based payment reserve arises on the vesting of share options under
the share option plan. Share options expired are reallocated from share based
payment reserve to retained deficit at their grant date fair value.
Retained deficit
Retained deficit comprises of losses incurred in the current and prior years.
CONSOLIDATED CASH FLOW STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2021
2021 2020
£ £
Cash flows from operating activities
Loss for the year (463,501) (361,308)
Adjustments for
Share based payment charge 82,264 51,415
Foreign exchange loss 1,516 102
Impairment of exploration and evaluation assets 62,074 -
Movements in working capital: (317,647) (309,791)
(Increase)/decrease in other receivables (148) 1,558
Increase in trade and other payables 119,141 99,945
Net cash used in operating activities (198,654) (208,288)
Cash flows from investing activities
Additions to exploration and evaluation assets (15,000) (3,479)
Net cash used in investing activities (15,000) (3,479)
Cash flows from financing activities
Issue of ordinary shares 500,000 -
Share issue expenses (30,000) -
Net cash generated from financing activities 470,000 -
Net cash increase/(decrease) in cash and cash equivalents 256,346 (211,767)
Cash and cash equivalents at the beginning of year 89,423 301,292
Exchange loss on cash and cash equivalents (1,516) (102)
Cash and cash equivalents at the end of the year 344,253 89,423
Notes:
1. ACCOUNTING POLICIES
There were no changes in accounting policies from those used to prepare the
Group's Annual Report for financial year ended 31 December 2021. The financial
statements have been prepared in accordance with the Companies Act 2006.
2. EARNINGS PER SHARE
Basic loss per share is computed by dividing the loss after taxation for the
year attributable to ordinary shareholders by the weighted average number of
ordinary shares in issue and ranking for dividend during the year. Diluted
loss per share is computed by dividing the loss after taxation for the year by
the weighted average number of ordinary shares in issue, adjusted for the
effect of all dilutive potential ordinary shares that were outstanding during
the year.
The following tables sets out the computation for basic and diluted earnings
per share (EPS):
(i) Earnings per share 2021 2020
Pence Pence
Basic and diluted EPS (0.06) (0.05)
(ii) Reconciliation of earnings used in calculating earnings per share
Loss from continuing operations attributable to the ordinary equity holders of
the Company:
Loss for the year (463,501) (361,308)
(iii) Denominator
2021 2020
Number Number
For basic and diluted EPS 817,717,558 716,979,964
The following potential ordinary shares are anti-dilutive and are therefore
excluded from the weighted average number of shares for the purpose of the
diluted earnings per share:
No. No.
Share options 40,500,000 40,500,000
3. GOING CONCERN
The Group incurred a loss for the year of £463,501 (2020: £361,308), had net
current liabilities of £1,139,661 (2020: £1,275,498) at the balance sheet
date. These conditions, as well as those noted below, represent a material
uncertainty that may cast doubt on the Group's ability to continue as a going
concern.
Included in current liabilities is an amount of £1,420,565 (2020:
£1,300,565) owed to directors in respect of directors' remuneration due at
the balance sheet date. The directors have confirmed that they will not seek
settlement of these amounts in cash until 31 December 2024.
The Group had a cash balance of £344,253 (2020: £89,423) at the balance
sheet date. The directors have prepared cashflow projections for a period of
at least 12 months from the date of approval of the financial statements which
indicate that the group may require additional finance to fund working capital
requirements and develop existing projects. As the Group is not revenue or
cash generating it relies on raising capital from the public market. On 27
April 2022 the Group raised £3,500,000 on a placing, further information is
detailed in Note 8 of these accounts.
As in previous years the Directors have given careful consideration to the
appropriateness of the going concern basis in the preparation of the financial
statements and believe the going concern basis is appropriate for these
financial statements. The financial statements do not include the adjustments
that would result if the Group and Company were unable to continue as a going
concern.
4. INTANGIBLE ASSETS
Exploration and evaluation assets
£
Cost:
At 1 January 2020 8,561,001
Additions 64,328
At 31 December 2020 8,625,329
Additions 15,000
At 31 December 2021 8,640,329
Accumulated amortisation and impairment:
At 1 January 2020 7,710,212
Impairment -
At 31 December 2020 7,710,212
Impairment 62,074
At 31 December 2021 7,772,286
Net book value
At 1 January 2020 850,789
At 31 December 2020 915,117
At 31 December 2021 868,043
Segmental analysis 2021
Group
£
Bolivia -
Ghana 868,043
868,043
Exploration and evaluation assets relate to expenditure incurred in
prospecting and exploration for lithium, oil and gas in Bolivia and Ghana. The
directors are aware that by its nature there is an inherent uncertainty in
exploration and evaluation assets and therefore inherent uncertainty in
relation to the carrying value of capitalised exploration and evaluation
assets.
During 2018 the Group resolved the outstanding issues with the Ghana National
Petroleum Company (GNPC) regarding a contract for the development of the Tano
2A Block. The Group has signed a Petroleum Agreement in relation to the block
and this agreement awaits ratification by the Ghanian government.
The Company is in negotiations with the Vice-Ministry of Electrical High
Technologies and the State Lithium Company in Bolivia on exploration and
development of salt-lakes in accordance with law. Samples have been analysed
and process work is underway.
To date the Group incurred expenditure of £62,074 in Bolivia. As at year end
no licences have yet been granted. Therefore, the directors have decided to
impair the costs. Accordingly, an impairment of £62,074 has therefore been
recorded by the Group in the current year.
The directors believe that there were no facts or circumstances indicating
that the carrying value of intangible assets may exceed their recoverable
amount and thus no impairment review was deemed necessary by the directors.
The realisation of these intangibles assets is dependent on the successful
discovery and development of economic deposit resources and the ability of the
Group to raise sufficient finance to develop the projects.
It is subject to a number of potential significant risks, as set out below:
· licence obligations;
· exchange rate risks;
· uncertainties over development and operational costs;
· political and legal risks, including arrangements with
Governments for licences, profit sharing and taxation;
· foreign investment risks including increases in taxes,
royalties and renegotiation of contracts;
· title to assets;
· financial risk management;
· going concern; and
· ability to raise finance.
Included in the additions for the year are £15,000 (2020: £60,849) of
directors' remuneration. The remaining balance pertains to the amounts
capitalised to the respective projects held by the entity.
5. TRADE AND OTHER PAYABLES
Current 2021 2020
£ £
Trade payables 48,783 40,142
Other accruals 16,500 26,000
Other payables 1,420,565 1,300,565
1,485,848 1,366,707
It is the Company's normal practice to agree terms of transactions, including
payment terms, with suppliers and provided suppliers perform in accordance
with the agreed terms, payment is made accordingly. In the absence of agreed
terms it is the Company's policy that payment is made between 30 to 40 days.
The carrying amount of trade and other payables approximates to their fair
value.
Other payables relate to amounts due for directors' remuneration of
£1,420,565 (2020: £1,300,565) accrued but not paid at year end.
6. SHARE CAPITAL
Allotted, called-up and fully paid 2021 2021 2020 2020
Number Share Capital Number Share Capital
£ £
Shares treated as equity
Ordinary shares of £0.0025 each 870,826,117 2,177,065 716,979,964 1,792,450
Issued and fully paid 2021 2021 2021 2020 2020 2020
Number Share Capital Share Premium Number Share Capital Share Premium
Ordinary shares of £0.0025 each £ £ £ £
At 1 January 716,979,964 1,792,450 10,900,373 716,979,964 1,792,450 10,900,373
Issued during the year 153,846,153 384,615 115,385 - - -
Share issue expenses (30,000)
At 31 December 870,826,117 2,177,065 10,985,758 716,979,964 1,792,450 10,900,373
Movements in issued share capital
On 6 May 2021 a total of 153,846,117 shares were placed at a price of 0.325
pence per share. Proceeds were used to provide additional working capital and
fund development costs
Share Options
A total of 40,500,000 share options were in issue at 31 December 2021 (2020:
40,500,000). These options are exercisable, at prices ranging between 0.70p
and 0.725p, up to seven years from the date of granting of the options unless
otherwise determined by the Board. Further information relating to Share
Options is outlined in Note 7.
7. SHARE BASED PAYMENTS
The Group issues equity-settled share-based payments to certain directors and
individuals who have performed services for the Group. Equity-settled
share-based payments are measured at fair value at the date of grant. Shares
issued to individuals and directors will vest 3 years from the period that the
awards relate.
Fair value is measured by the use of a Black-Scholes model.
The Group plan provides for a grant price equal to the average quoted market
price of the ordinary shares on the date of grant.
2021 2020
Weighted average Weighted average
31/12/2021 exercise price 31/12/2020 31/12/2020
Options in pence Options In pence
Outstanding at beginning of year 40,500,000 0.7 40,500,000 0.7
Issued - - - -
Expired - - - -
Outstanding at end of the year 40,500,000 0.7 40,500,000 0.7
Exercisable at end of the year 30,500,000 0.7 27,166,667 0.7
During 2019 40,000,000 options were granted with a fair value of £246,788.
These fair values were calculated using the Black-Scholes valuation model.
These options will vest over a 3-year period and will be capitalised or
expensed on a straight line basis over the vesting period.
The inputs into the Black-Scholes valuation model were as follows:
Grant 2 October 2019
Weighted average share price at date of grant (in pence) 0.7p
Weighted average exercise price (in pence) 0.7p
Expected volatility 116.23%
Expected life 7 years
Risk free rate 1.3%
Expected dividends none
Expected volatility was determined by management based on their cumulative
experience of the movement in share prices.
The terms of the options granted do not contain any market conditions within
the meaning of IFRS 2.
The Group capitalised expenses of £Nil (2020: £30,849) and expensed costs of
£82,264 (2020: £ 51,415) relating to equity-settled share-based payment
transactions during the year.
8. POST BALANCE SHEET EVENTS
On 12 January 2022, the Company announced, as was known, that it had been
accruing and not paying in cash, salaries of the current Directors since 2010.
The accrued liability as at 31 December 2021 for the three longest serving
directors (Dr Teeling, Mr Horgan and Mr Finn) is £1,340,564. The Board
remains cognisant of the need to conserve cash resources in the current
environment and therefore these three Directors have agreed to continue
deferring payment of this amount, in cash, until the end of 2024.
In consideration for this past and continued deferral, these directors were
issued 3.25 warrants over Ordinary Shares per each 1p of accrued salary due
until 31 December 2021. The Warrants are exercisable at 0.25p at any time
until 11 January 2025 and have been allocated as follows:
Director Accrued salary (£) Warrants exercisable at conversion price of 0.25p per share
David Horgan £569,037 184,937,025
John Teeling £395,704 128,603,800
James Finn £375,823 122,142,475
Accordingly, in aggregate, 435,683,300 Warrants have been issued to the above
Directors. Any exercise of the Warrants is restricted to the extent that, if
by exercising, the Warrant holders, in aggregate, hold greater than 29.9 per
cent. of the total voting rights of the Company.
For the avoidance of doubt, the deferred salaries, unless otherwise settled,
will remain payable in cash after the end of 2024.
On 27 April 2022 the Company announced that it had raised £3,500,000 via the
placing of 1,400,000,000 ordinary shares with new investors at a price of
0.25p per placing share.
On 9 May 2022 the Company announced that it had acquired a 10 per cent.
interest in the high-impact multi-TCF (Trillion Cubic Feet) Sasanof
exploration prospect (located mainly within Exploration Permit WA-519-P)
through the acquisition of a 10 per cent. interest in Western Gas, which
wholly owns the prospect (the "Acquisition").
The Acquisition consideration comprised of a cash consideration of
US$4,000,000, and 100,000,000 ordinary shares of 0.25p each ("Ordinary
Shares"), valued at £480,000 as at 6 May 2022. In the event of a discovery at
the Sasanof-1 well, further consideration would have been payable.
On 6 June 2022 the Company announced that no commercial hydrocarbons were
intersected and the Sasanof-1 Well will now be plugged and permanently
abandoned. De-mobilisation activities will then commence. All costs
incurred on the Sasanof prospect will be written off in full.
9. ANNUAL GENERAL MEETING
The Company's Annual General Meeting will be held on Thursday 4(th) August
2022 at Hilton London Paddington, 146 Praed Street, London, W2 1EE, United
Kingdom at 12.00pm. Further information, including the Notice of AGM, will be
provided shortly.
10. GENERAL INFORMATION
The financial information set out above does not constitute the Company's
audited financial statements for the year ended 31 December 2021 or the year
ended 31 December 2020. The financial information for 2020 is derived from the
financial statements for 2020 which have been delivered to Companies House.
The auditors had reported on the 2020 statements; their report was unqualified
with an emphasis of matter in respect of considering the adequacy of the
disclosures made in the financial statements concerning the valuation of
intangible assets, and did not contain a statement under section 498(2) or
498(3) of the Companies Act 2006. The financial statements for 2021 will be
delivered to Companies House.
A copy of the Company's Annual Report and Accounts for 2021 will be mailed
shortly only to those shareholders who have elected to receive it. Otherwise,
shareholders will be notified that the Annual Report will be available on the
website www.clontarfenergy.com (http://www.clontarfenergy.com) . Copies of the
Annual Report will also be available for collection from the Company's
registered office, Suite 1, 3(rd) Floor, 11-12 St. James's Square, London,
SW1Y 4LB.
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
or visit
www.rns.com (http://www.rns.com/)
.
RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
. END FR EAXKFAEPAEFARecent news on Clontarf Energy
See all newsREG - Clontarf Energy PLC - Grant of Share Options
AnnouncementREG - Clontarf Energy PLC - Bolivia Update, Fundraising and TVR
AnnouncementREG - Clontarf Energy PLC - Encouraging Bolivian Brines Progress
AnnouncementREG - Clontarf Energy PLC - South American Brines Progress
AnnouncementREG - Clontarf Energy PLC - Interim Results for the period ended 30 June 2023
Announcement