REG - Mosman Oil & Gas - Half Year Results
27/03/2024 09:15
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RNS Number : 5119I Mosman Oil and Gas Limited 27 March 2024
27 March 2024
Mosman Oil and Gas Limited
("Mosman" or the "Company")
Half Year Results
Mosman Oil and Gas Limited (AIM: MSMN) the hydrocarbon, helium and hydrogen
exploration, development and production company, announces its Half Year
results to 31 December 2023 (H124).
Summary
· Revenue: $533,794 (H123 $936,187) mainly impacted by notably lower production
at Stanley and Cinnabar where work continues to resolve production
challenges.
· Gross Profit: $34,059 (H123 $283,003)
· Net loss: $984,851 (H123 $665,096)
· Net Production to Mosman of 6,289BOE
All amounts are in Australian Dollars
(1)BOE/boe - barrels of oil equivalent
(2)Gross Project Production - the production of BOE at a total project level
(100% basis) before royalties (where Mosman is the Operator) and where Mosman
is not the operator the total gross production for the project
(3)Net Production - Net to Mosman's Working interest before royalties
Operational overview
USA
· Development project continues at Cinnabar where technical work has identified
opportunities for increasing production. Workovers undertaken had limited
success. Technical work has identified a zone to be recompleted before the
next step of installing artificial lift. Technical work is being conducted on
the new lease area acquired that appears highly prospective based on 3D
seismic.
· Stanley continues to be the main centre of production. Production was affected
by downtime due to reconfiguration of production equipment and weather
conditions in December.
Australia
· EP 145 Farmout Agreement was signed with a subsidiary of Greenvale Energy Ltd
(ASX:GRV) in October to fund seismic and drilling. GRV can earn 75% interest
by funding seismic acquisition and drilling a well (to a cap of $5.5m). This
agreement remains subject to completion pending ministerial approval.
· EP(A) 155 is subject to a conditional farmout agreement and continues the
process of seeking native title approval required for the grant of the
licence.
Board update
· John Young stepped down from the Board in September 2023.
· Andy Carroll, Technical Director appointed CEO in September, with Nigel Harvey
appointed as Non-Executive Chairman and Carl Dumbrell appointed to the Board
as Non-Executive Director. John Barr stepped down in October 20223.
Andy Carroll, CEO of Mosman commented:
"The Board has been refreshed and the company has been re-organised with a
lower cost base. In the US, we continue cost effective production optimisation
to commercialise these assets and exploration work continues in Australia on
the areas prospective for helium, hydrogen and hydrocarbons."
Enquiries:
Mosman Oil & Gas Limited NOMAD and Joint Broker
Andy Carroll SP Angel Corporate Finance LLP
CEO Stuart Gledhill / Richard Hail / Adam Cowl
acarroll@mosmanoilandgas.com (mailto:acarroll@mosmanoilandgas.com) +44 (0) 20 3470 0470
Alma Strategic Communications Joint Broker
Justine James / Will Merison CMC Markets UK Plc
+44 (0) 20 3405 0205 Douglas Crippen
+44 (0) 7525 324431 +44 (0) 020 3003 8632
mosman@almastrategic.com (mailto:mosman@almapr.co.uk)
Updates on the Company's activities are regularly posted on its
website: www.mosmanoilandgas.com (http://www.mosmanoilandgas.com/)
Notes to editors
Mosman (AIM: MSMN) is an oil exploration, development, and production company
with projects in the US and Australia. Mosman's strategic objectives remain
consistent: to identify opportunities which will provide operating cash flow
and have development upside, in conjunction with progressing exploration of
its existing exploration permit and permit application. The Company has
several projects in the US. In addition to exploration projects in the Amadeus
Basin in Central Australia.
Operations Review
Mosman's strategic objective remains to identify opportunities which will
provide operating cash flow and have development upside, in conjunction with
exploration of existing exploration permits and acquiring high potential
projects.
The conclusion of the Strategic Review was to commercialise the production
assets (which may include sale of some assets) and not to proceed with IPO of
the Australian assets as there was limited investor interest in IPOs in 2023.
As part of this process, the Group incurred some costs in establishing a
holding company for the Australian assets in regard to evaluating the
potential for an IPO of that company.
The Board renewal process was completed with the appointment of Carl Dumbrell.
Carl is a qualified accountant and brings extensive experience in Australian
and AIM companies. John W Barr and John Young stepped down and are thanked for
their service in the successful IPO and steering the company through
exploration and building a production base in the USA. The corporate
re-organisation resulted in a reduction in the number of Directors from four
to three; the reduction in executive directors from two to one; and a clearer
separation of Board and management with two independent Directors and a Chief
Executive Officer, and the redundancy of the one employee. Whilst there are
now lower fixed overheads, there were some one-off costs associated with this
reorganisation.
Turning to development of the producing US projects, more than $475k was
invested in increasing production and progressing exploration during the
period. Stanley continues to be the main centre of production and the
production equipment has been reconfigured with jet pumps.
The development project, Cinnabar, was which was acquired at modest cost when
oil and gas prices were lower in 2021, has had an extensive technical work,
including reprocessing and re-interpretation of 3D seismic. Whilst results of
the Cinnabar development well drilled in November 2022 confirmed the presence
of oil and led to an upgrade of Reserves, the production rates have been
disappointing. Technical work has identified opportunities for increasing
production, and several workovers have now been undertaken on the three wells
on the lease. Work will continue to increase production, and to de-risk a new
lease area acquired that appears highly prospective based on 3D seismic.
Gross Reserves (MBOE):
Proved Developed Producing Proved Proved Undeveloped Total Proved Total Probable Total Proved Plus Probable
Developed
Behind Pipe
302 147 1,132 1,581 65 1,646
In Australia's Northern Territory, Mosman holds a 100% interest over the
EP-145 permit and continues to work to secure all required approvals for the
next step of exploration.
A Farmout Agreement was signed with a subsidiary of Greenvale Energy (ASX:GRV)
in October 2023, whereby GRV can earn 75% interest by funding seismic
acquisition and drilling a well (to a cap of AUD 5.5 million). This currently
remains subject to completion pending ministerial approval.
A Prospective Resource estimate for EP-145 was published by Mosman in October
2022 and is detailed below.
Prospective Resources (Bcf) Low Estimate Best Estimate High Estimate
Total Gas 12 440 2,290
Helium 0.3 26.4 229
Hydrogen 0.24 26.4 275
As shareholders and stakeholders expect, Mosman continues to take its Health
and Safety requirements very seriously and to date there have been no health,
safety or wellbeing issues reported in our small team.
Results
The unaudited results for the six months to 31 December 2023 reflect a 43%
decrease in sales to $533,794 ($936,187 in 2022). Gross profit also decreased
by 88% to $34,059 ($283,003 in 2022). The lower sales and gross profit margins
were primarily due to lower production at Cinnabar and Stanley as
recompletions and upgrade works were undertaken, as well as lower oil and gas
prices in the period.
The overall result for the period was a net loss of $984,851 (2022: $665,096).
This includes one-off restructuring costs of over $100k that are intended to
reduce ongoing costs.
Projects
Mosman has Working Interests in eight onshore producing projects located in
the USA, in addition to one granted exploration permit and one application for
an exploration permit in the Amadeus Basin in Central Australia.
Producing Projects in the USA
A summary of the current oil and gas projects as at 27 March 2024:
US PROJECTS
Asset/ Project Mosman Interest(1) Location Status
Cinnabar Texas Producing
75.0%
Cinnabar Extended 78.0% Texas Undrilled
Stanley (various wells) 34.85% to 38.5% Texas Producing
Livingston 20% Texas Producing
Winters-1 29% Texas Producing
Winters-2 23% Texas Producing
Greater Stanley (Duff wells) Texas Producing
40%
Arkoma 27% Oklahoma Producing
(1. ) Mosman's ownership is working interest before royalties.
The interest shown is approximate, as there are small variations on individual
wells
Production Summary for the six months ending 31 December 2023
Gross Project Production(2) Net Production to Mosman(3)
BOE(1) BOE(1)
Cinnabar 1,246 933
Stanley 9,989 3,631
Winters 3,145 734
Livingston 1,045 209
Arkoma 3,718 782
Total Production 19,143 6,289
(1)BOE/boe - barrels of oil equivalent
(2)Gross Project Production - Means the production of BOE at a total project
level (100% basis) before royalties (where Mosman is the Operator) and where
Mosman is not the operator the total gross production for the project
(3)Net Production - Net to Mosman's Working Interest; Net Production
attributable to Mosman means net to Mosman's Working Interest before royalties
Australia
AUSTRALIAN EXPLORATION PROJECTS
Asset/Project Mosman Interest(1) Location Status Permit Number Licence Renewal Date Comments
Australia, Amadeus Basin 100%(2) NT Exploration EP 145 21 August 2024 Seismic to be acquired
(subject to farm-in)
Australia, Amadeus Basin 100% NT Exploration Application Negotiating land access with CLC
(subject to farm-in) EPA 155
(1. ) Mosman's ownership is working interest before royalties
and the interest shown is subject to farmin agreements (detailed below)
Mosman has continued to conduct technical work on its Central Australian
exploration projects, focused on the 100% owned EP-145, in the Amadeus Basin,
Northern Territory.
The Prospective Resource estimate for EP-145 published by Mosman in October
2022 and is detailed below.
Prospective Resources (Bcf) Low Estimate Best Estimate High Estimate
Total Gas 12 440 2,290
Helium 0.3 26.4 229
Hydrogen 0.24 26.4 275
All seismic and drilling activities are subject to obtaining the necessary
planning approvals from the NT Department of Industry and Resources.
On 16 October 2023, the Company announced that it had entered into a farmout
agreement with Greenvale Gold Pty Ltd, a wholly owned subsidiary of Greenvale
Energy Ltd (ASX:GRV) to fund seismic and drilling on its EP 145 project in the
Northern Territory of Australia. Upon Completion, Mosman would retain a 25%
working interest in EP 145 and Greenvale would earn a 75% working interest in
EP 145 by:
· Committing to pay AUD160,000 in cash within 5 days of Completion,
which is subject to government approval of the transfer of interest and
Operatorship.
· Paying for the EP 145 Permit Year 3 Work Program, including
seismic, effective from Completion Date.
· Funding the Permit Year 4 Work Program, including drilling one
well with a well cost cap of AUD5.5 million.
· The Year 3 Work Program is to be completed by August 2024 and the
cost of the seismic acquisition is estimated to be circa AUD2 million.
· The Year 4 Work Program is to be completed by August 2025. The
cost of drilling a well depends on many factors including the depth of a well
and cost of drilling rigs at the time of drilling.
At Mosman's other central Australian project in EPA-155, the permit
application is subject to Native Title negotiations. The required site visit
was delayed by the Covid-19 pandemic. Mosman has a farmout agreement, and the
farm-in partner has advised they are discussing with the Central Land Council
("CLC") and have arranged a site visit.
Matters subsequent to the reporting period
Subsequent to the end of the reporting period the Company announced the following material matters occurred:
· On 15 January 2024, the Group announced it had lodged the
Environmental Management Plan ("EMP") with the Northern Territory Government.
Approval of the EMP and re-issue of the Aboriginal Areas Protection Authority
('AAPA') Certificate are the two remaining approvals required prior to the
acquisition of 2D seismic, scheduled for 2024.
· On 23 January 2024, the Group announced that Mosman and Greenvale
Gas Ltd ("GRV"), a subsidiary of Greenvale Pty Ltd (ASX:GRV), had agreed to
amend the Farmin Agreement so that the right for either party to terminate the
agreement is changed from 31 January to 30 March 2024.
· On 2 February, the Group announced it had raised £300,000
(before expenses) by way of a placing of 2,400,000,000 ordinary shares at a
price of 0.0125 pence per share.
· On 7 February, the Group held and Extraordinary General Meeting,
where shareholder approval was received to issue 84,210,526 shares and
42,105,263 warrants to CEO Andrew Carroll, and 42,105,263 shares and
21,052,632 warrants to Chairman Nigel Harvey. Shares were issued for cash
consideration at 0.0125p per share. The warrants are exercisable at 0.025p
each with a two year expiry. All shares and warrants were issued on the same
terms as the placement announced on 29 November 2023.
There were no other material matters that occurred subsequent to 31 December
2023.
Glossary:
boe Barrels of oil equivalent based on calorific value as opposed to dollar value
boepd Barrels of oil per day of oil equivalent based on calorific value as opposed
to dollar value
bopd Barrels of oil per day
Gross Project Production Means the production of BOE at a total project level (100% basis) before
royalties (where Mosman is the Operator) and where Mosman is not the operator
the total gross production for the project
Mcf Thousand cubic feet
Bcf Billion cubic feet
Mcfpd Thousand cubic feet per day
MBtu One thousand British Thermal Units
MBtupd One thousand British Thermal Units per day
MMBtu One million British Thermal Units
MMBtupd One million British Thermal Units per day
Net Production Net to Mosman's Working Interest; Net Production attributable to Mosman means
net to Mosman's Working Interest before royalties
SPE Society of Petroleum Engineers
SPE PRMS A standard for the definition, classification, and estimation of hydrocarbon
resources developed by the Oil and Gas Reserves Committee of the Society of
Petroleum Engineers and named the Petroleum Resource Management System
Condensed Consolidated Statement of Profit or Loss and Other Comprehensive
Income
For The Half Year Ended 31 December 2023
Notes Consolidated Consolidated
6 months to 6 months to
31 December 2023 31 December 2022
$ $
Revenue 533,794 936,187
Cost of sales 2 (499,735) (653,184)
Gross profit 34,059 283,003
Interest income 348 139
Administrative expenses (205,505) (280,957)
Corporate expenses 3 (467,567) (450,964)
Directors fees (57,880) (62,667)
Exploration expenses incurred, not capitalised (7,425) (9,300)
Employee benefits expense (48,268) (40,685)
Finance costs (5,642) (5,676)
Amortisation expense (215,337) (94,861)
Depreciation expense (6,220) (919)
Loss on foreign exchange (5,414) (2,209)
Loss from ordinary activities before income tax expense (984,851) (665,096)
Income tax expense - -
Net loss for the period (984,851) (665,096)
Other comprehensive profit
Items that may be reclassified to profit or loss
- Foreign currency gain/(loss) (148,877) 65,405
Total comprehensive income attributable to members of the entity (1,133,728) (599,691)
Basic loss per share (cents per share) (0.01) cents (0.01) cents
Diluted loss per share (cents per share) (0.01) cents (0.01) cents
The accompanying notes form part of these consolidated financial statements
All amounts are in Australian Dollars
Consolidated Statement of Financial Position
As at 31 December 2023
Notes Consolidated Consolidated
31 December 2023 30 June 2023
$ $
Current Assets
Cash and cash equivalents 614,305 520,613
Trade and other receivables 4 764,085 863,639
Other assets 5 110,006 78,086
Total Current Assets 1,488,396 1,462,338
Non-Current Assets
Property, plant & equipment - 6,220
Oil and gas assets 6 5,824,674 5,780,587
Capitalised oil and gas exploration 7 1,491,725 1,420,531
Total Non-Current Assets 7,316,399 7,207,338
Total Assets 8,804,795 8,669,676
Current Liabilities
Trade and other payables 8 1,490,357 1,185,450
Provisions - 15,500
Total Current Liabilities 1,490,357 1,200,950
Non-Current Liabilities
Provisions 175,043 180,587
Total Non-Current Liabilities 175,043 180,587
Total Liabilities 1,665,400 1,381,537
Net Assets 7,139,395 7,288,139
Shareholders' Equity
Contributed equity 9 41,656,179 40,675,340
Reserves 10 763,362 908,094
Accumulated losses (35,280,146) (34,295,295)
Total Shareholders' Equity 7,139,395 7,288,139
The accompanying notes form part of these consolidated financial statements
All amounts are in Australian Dollars
Consolidated Statement of Changes in Equity
For the Half Year Ended 31 December 2023
Accumulated Contributed Equity Reserves Total
Losses
$ $ $ $
Balance at 1 July 2022 (32,168,097) 38,743,432 706,297 7,281,632
Comprehensive income
Loss for the period (665,096) - - (665,096)
Other comprehensive income for the period - - 65,405 65,405
Total comprehensive loss for the period (665,096) - 65,405 (599,691)
Transactions with owners, in their capacity as owners, and other transfers:
New shares issued - 1,406,312 - 1,406,312
Cost of raising equity - (84,379) - (84,379)
Total transactions with owners and other transfers - 1,321,933 - 1,321,933
Balance at 31 December 2022 (32,833,193) 40,065,365 771,702 8,003,874
Balance at 1 July 2023 (34,295,295) 40,675,340 908,094 7,288,139
Comprehensive income
Loss for the period (984,851) - - (984,851)
Other comprehensive loss for the period - - (148,877) (148,877)
Total comprehensive loss for the period (984,851) - (148,877) (1,133,728)
Transactions with owners, in their capacity as owners, and other transfers:
New shares issued - 1,047,856 - 1,047,856
Cost of raising equity - (67,017) 4,145 (62,872)
Total transactions with owners and other transfers - 980,839 4,145 984,984
Balance at 31 December 2023 (35,280,146) 41,656,179 763,362 7,139,395
The accompanying notes form part of these consolidated financial statements
All amounts are in Australian Dollars
Consolidated Statement of Cash Flows
For the Half Year Ended 31 December 2023
Consolidated Consolidated
6 months to 6 months to 31 December 2022
31 December 2023
$ $
Cash flows from operating activities
Receipts from customers 633,460 922,683
Payments to suppliers and employees (875,426) (1,477,116)
Interest paid (5,642) (5,676)
Net cash outflow from operating activities (247,608) (560,109)
Cash flows from investing activities
Payments for property, plant and equipment - (3,629)
Payments for oil and gas assets (408,786) (2,108,026)
Payments for acquisition of new subsidiaries (153,230) (145,158)
Payments for exploration and evaluation (71,194) (52,894)
Net cash outflow from investing activities (633,210) (2,309,707)
Cash flows from financing activities
Proceeds from shares issued 1,047,856 1,406,312
Payments for costs of capital (62,872) (84,379)
Net cash inflow from financial activities 984,984 1,321,933
Net decrease in cash and cash equivalents 104,166 (1,547,883)
Effects of exchange rate changes on cash and cash equivalents (10,474) 3,570
Cash and cash equivalents at the beginning of the period 520,613 2,354,689
Cash and cash equivalents at the end of the period 614,305 810,376
The accompanying notes form part of these consolidated financial statements
All amounts are in Australian Dollars
Condensed Notes to the Financial Statements
For the Half-Year Ended 31 December 2023
All amounts are Australian Dollars
1. Summary of Significant Accounting Policies
Statement of Compliance
The half-year financial report is a general purpose financial report prepared
in accordance with the Corporations Act 2001 and AASB 134 Interim Financial
Reporting. Compliance with AASB 134 ensures compliance with International
Financial Reporting Standard IAS34 Interim Financial Reporting. The half-year
report does not include notes of the type normally included in an annual
financial report and should be read in conjunction with the most recent annual
financial report.
Basis of preparation
The condensed consolidated financial statements have been prepared on the
basis of historical cost, except for the revaluation of certain non-current
assets and financial instruments. Cost is based on the fair values of the
consideration given in exchange for assets. All amounts presented in
Australian dollars, unless otherwise noted.
The accounting policies and methods of computation adopted in the preparation
of the half-year financial report are consistent with those adopted and
disclosed in the Group's 2023 annual financial report for the financial year
ended 30 June 2023, except for the impact of the Standards and Interpretations
described below. These accounting policies are consistent with Australian
Accounting Standards and with International Financial Reporting Standards
(IFRS).
Going Concern
The condensed consolidated financial statements have been prepared on the
going concern basis, which contemplates continuity of normal business
activities and the realisation of assets and the discharge of liabilities in
the normal course of business.
The directors have considered the funding and operational status of the
business in arriving at their assessment of going concern and believe that the
going concern basis of preparation is appropriate, based upon the following:
· The ability to further vary cash flow depending upon the
achievement of certain milestones within the business plan and;
· The ability of the Company to obtain funding through various
sources, including debt and equity.
However, should the Group be unable to raise further required financing from
equity markets or other sources, there is uncertainty which may cast doubt as
to whether or not the Group will be able to continue as a going concern and
whether it will realise its assets and extinguish its liabilities in the
normal course of business and at the amounts stated in the financial
statements.
The financial statements do not include any adjustments relating to the
recoverability and classification of recorded asset amounts nor to the amounts
and classification of liabilities that might be necessary should the Group not
continue as a going concern.
Exploration and Evaluation Costs
Exploration and evaluation expenditure incurred is accumulated in respect of
each identifiable area of interest. These costs are carried forward in respect
of an area for which the rights to tenure are current and that has not at
reporting date reached a stage which permits a reasonable assessment of the
existence or otherwise of economically recoverable reserves, and active and
significant operations in, or relating to, the area of interest are
continuing.
Impairment of Exploration and Evaluation Assets
The ultimate recoupment of the value of exploration and evaluation assets is
dependent on the successful development and commercial exploitation, or
alternatively, sale, of the exploration and evaluation assets.
Impairment tests are carried out when there are indicators of impairment in
order to identify whether the asset carrying values exceed their recoverable
amounts. There is significant estimation and judgement in determining the
inputs and assumptions used in determining the recoverable amounts. If, after
having capitalised the expenditure under the policy, a judgement is made that
the recovery of the expenditure is unlikely, the relevant capitalised amount
will be written off to profit and loss.
Condensed Notes to the Financial Statements
For the Half-Year Ended 31 December 2023
All amounts are Australian Dollars
1. Summary of Significant Accounting Policies (Continued)
The key areas of judgement and estimation include:
· Recent exploration and evaluation results and resource estimates;
· Environmental issues that may impact on the underlying tenements;
and
· Fundamental economic factors that have an impact on the
operations and carrying values of assets and liabilities.
Revenue and Other Income
Revenue is measured at the fair value of the consideration received or
receivable. Amounts disclosed as revenue are net of returns, trade allowances,
rebates and amounts collected on behalf of third parties.
The group recognises revenue when the amount of revenue can be reliably
measured, it is probable that future economic benefits will flow to the entity
and specific criteria have been met for each of the Group's activities as
described below. The group bases its estimates on historical results, taking
into consideration the type of customer, the type of transaction and the
specifics of each arrangement.
Revenue from joint operations is recognised based on the Group's share of the
sale by the joint operation.
Interest revenue is recognised using the effective interest rate method,
which, for floating rate financial assets, is the rate inherent in the
instrument.
Oil and Gas assets
The cost of oil and gas producing assets and capitalised expenditure on oil
and gas assets under development are accounted for separately and are stated
at cost less accumulated amortisation and impairment losses. Costs include
expenditure that is directly attributable to the acquisition or construction
of the item as well as past exploration and evaluation costs.
When an oil and gas asset commences production, costs carried forward are
amortised over the expected life of the economically recoverable reserves.
Changes in factors such as estimates of economically recoverable reserves that
affect amortisation calculations do not give rise to prior financial period
adjustments and are dealt with on a prospective basis.
Segment Reporting
Operating segments are reported in a manner consistent with the internal
reporting provided to the chief operating decision maker. The chief operating
decision maker, who is responsible for allocating resources and assessing
performance.
New standards and interpretations
The consolidated entity has adopted all of the new or amended Accounting
Standards and Interpretations issued by the Australian Standards Board
('AASB') that are mandatory for the current reporting period.
Any new or amended Accounting Standards or Interpretations that are not yet
mandatory have not been early adopted.
Condensed Notes to the Financial Statements
For the Half-Year Ended 31 December 2023
All amounts are Australian Dollars
Consolidated Consolidated
6 months to 31 December 2023 6 months to 31 December 2022
$ $
2 Cost of sales
Cost of sales 22,285 49,516
Lease operating expenses 477,450 603,668
499,735 653,184
$ $
3 Corporate Costs
Accounting, Company Secretary and Audit fees 88,075 150,109
Consulting fees - board 210,000 159,250
Consulting fees - other 33,098 31,302
NOMAD and broker expenses 90,956 74,728
Legal and compliance fees 45,438 35,575
467,567 450,964
( ) Consolidated Consolidated
Balance as at 31 December 2023 Balance as at 30 June 2023
( ) $ $
4 Trade and Other Receivables
Joint interest billing receivables(1) 548,399 644,904
Less: allowance for expected credit losses (119,962) (123,762)
Deposits 55,706 55,358
GST receivable 29,476 24,353
Accrued revenue 246,080 253,044
Other receivables 4,386 9,742
764,085 863,639
1. When appropriate, unpaid joint interest billing receivables are
recovered from the interest holders share of production income.
5 Other Assets
Prepayments 107,467 75,547
Incorporation costs 2,539 2,539
110,006 78,086
6 Oil and Gas
Assets
Cost brought forward 5,780,587 4,145,488
Acquisition of oil and gas assets during the period - 54,113
Capitalised equipment workovers during the period 408,786 2,362,772
Amortisation for the period (215,337) (436,028)
Impairment of oil and gas assets - (474,586)
Impact of Foreign Exchange on opening balances (149,362) 128,828
Carrying value at the end of the period 5,824,674 5,780,587
The Board has carried out an impairment assessment of the Oil and Gas Assets
and have concluded that no impairment is required.
Consolidated Consolidated
Balance as at 31 December 2023 Balance as at 30 June 2023
7 Capitalised Oil and Gas
Expenditure
Cost brought forward 1,420,531 1,240,541
Exploration costs incurred during the period 71,194 179,990
Impairment of oil and gas expenditure - -
Carrying value at end of the period 1,491,725 1,420,531
On 16 October 2023, the Company announced that it had entered into a farmout
agreement with Greenvale Gold Pty Ltd, a wholly owned subsidiary of Greenvale
Energy Ltd (ASX:GRV) to fund seismic and drilling on its EP 145 project in the
Northern Territory of Australia. Upon Completion, Mosman would retain a 25%
working interest in EP 145 and Greenvale would earn a 75% working interest in
EP 145 by:
· Committing to pay AUD160,000 in cash within 5 days of Completion,
which is subject to government approval of the transfer of interest and
Operatorship.
· Paying for the EP 145 Permit Year 3 Work Program, including
seismic, effective from Completion Date.
· Funding the Permit Year 4 Work Program, including drilling one
well with a well cost cap of AUD5.5 million.
· The Year 3 Work Program is to be completed by August 2024 and the
cost of the seismic acquisition is estimated to be circa AUD2 million.
The Year 4 Work Program is to be completed by August 2025. The cost of
drilling a well depends on many factors including the depth of a well and cost
of drilling rigs at the time of drilling.
On 23 January 2024, it was agreed to amend the Farmin Agreement so that the
right for either party to terminate the agreement is changed from 31 January
to 30 March 2024.
$ $
8 Trade and Other Payables
Trade creditors 1,399,840 1,000,619
Amounts owing for acquisition of Nadsoilco LLC - 150,830
Other creditors and accruals 90,517 34,001
1,490,357 1,185,450
9 Contributed Equity
Ordinary Shares:
Value of Ordinary Shares fully paid
Movement in Contributed Equity Number of shares Contributed Equity $
Balance as at 1 July 2022: 5,220,138,052 38,743,432
02/11/2022 Shares issued (i) $0.00123 1,142,857,142 1,406,312
04/04/2023 Shares issued (ii) $0.00101 45,454,545 45,829
26/04/2023 Shares issued (i) $0.00103 545,454,545 564,145
Capital raising costs - (84,378)
Balance as at 1 July 2023: 6,953,904,284 40,675,340
20/07/2023 Shares issued (i) $ 0.00067 857,142,857 571,739
05/12/2023 Shares issued (i) $ 0.00024 2,000,000,000 476,117
Capital raising costs - (67,017)
Balance at the end of period 9,811,047,141 41,656,179
(i) Placements via capital raising as announced
(ii) Shares issued to suppliers
Consolidated Consolidated
Balance as at 31 December 2023 Balance as at 30 June 2023
$ $
10 Reserves
Foreign currency translation reserve 741,899 890,776
Options reserve 21,463 17,318
763,362 908,094
Foreign Currency Translation Reserve
Foreign Currency Translation Reserve at the beginning of the period 890,776 706,297
Current movement in the period (148,877) 184,479
Foreign Currency Translation Reserve at the end of the period 741,899 890,776
Options Reserve
Options Reserve at the beginning of the period 17,318 -
Current movement in the period 4,145 17,318
Options Reserve at the end of the period 21,463 17,318
120,000,000 warrants were issued to brokers as part of their fee for
facilitating a placement of shares in the period. The warrants are valued
using the Binomial Method with the following inputs:
Share price at issue date 0.0118 British Pence
Exercise price 0.0125 British Pence
Risk-Free Interest Rate 3.9%
Volatility 91.8%
11 Segment Information
The Group has identified its operating segments based on the internal reports
that are reviewed and used by the board to make decisions about resources to
be allocated to the segments and assess their performance.
Operating segments are identified by the board based on the Oil and Gas
projects in Australia the United States. Discrete financial information about
each project is reported to the board on a regular basis.
The reportable segments are based on aggregated operating segments determined
by the similarity of the economic characteristics, the nature of the
activities and the regulatory environment in which those segments operate.
The Group has two reportable segments based on the geographical areas of the
mineral resource and exploration activities in Australia, the United States.
Unallocated results, assets and liabilities represent corporate amounts that
are not core to the reportable segments.
(i) Segment performance
United States Australia Total
$ $ $
Period ended 31 December 2023
Revenue
Revenue 533,794 - 533,794
Other income - 348 348
Segment revenue 533,794 348 534,142
Segment Result
Loss
Allocated
- Corporate costs - (467,567) (467,567)
- Administrative costs (146,289) (59,216) (205,505)
- Lease operating expenses (477,450) - (477,450)
- Cost of sales (22,285) - (22,285)
Segment net profit/(loss) before tax (112,230) (526,435) (638,665)
Reconciliation of segment result to net loss before tax
Amounts not included in segment result but reviewed by the Board
- Evaluation expenses incurred not capitalised - (7,425) (7,425)
- Amortisation (215,337) - (215,337)
- Impairment - - -
Unallocated items
- Employee benefits expense (106,148)
- Finance costs (5,642)
- Depreciation (6,220)
- Loss on foreign exchange (5,414)
Net Loss before tax from continuing operations (984,851)
(i) Segment performance (continued)
United States Australia Total
$ $ $
Period ended 31 December 2022
Revenue
Revenue 936,187 - 936,187
Other income - 139 139
Segment revenue 936,187 139 936,326
Segment Result
Loss
Allocated
- Corporate costs (37,509) (413,455) (450,964)
- Administrative costs (156,566) (124,391) (280,957)
- Lease operating expenses (603,668) - (603,668)
- Cost of sales (49,516) - (49,516)
Segment net profit/(loss) before tax 88,928 (537,707) (448,779)
Reconciliation of segment result to net loss before tax
Amounts not included in segment result but reviewed by the Board
- Evaluation expenses incurred not capitalised - (9,300) (9,300)
- Amortisation (94,861) - (94,861)
- Impairment - - -
Unallocated items
- Employee benefits expense (103,352)
- Finance costs (5,676)
- Depreciation (919)
- Loss on foreign exchange (2,209)
Net Loss before tax from continuing operations (665,096)
(ii) Segment assets
United States Australia Total
$ $ $
As at 31 December 2023
Segment assets as at 1 July 2023 7,017,407 1,652,269 8,669,676
Segment asset balances at end of
period
- Exploration and evaluation - 8,672,643 8,672,643
- Capitalised Oil and Gas 10,595,577 - 10,595,577
- Less: Amortisation (1,087,371) - (1,087,371)
- Less: Impairment (3,683,532) (7,180,918) (10,864,450)
5,824,674 1,491,725 7,316,399
Reconciliation of segment assets to total assets:
Other assets 1,046,871 441,525 1,488,396
Total assets from continuing operations 6,871,545 1,933,250 8,804,795
United States Australia Total
$ $ $
As at 30 June 2023
Segment assets as at 1 July 2022 5,618,867 2,983,533 8,602,400
Segment asset balances at end of
period
- Exploration and evaluation - 8,601,449 8,601,449
- Capitalised oil and gas assets 10,490,641 - 10,490,641
- Less: Amortisation (909,850) - (909,850)
- Less: Impairment (3,800,204) (7,180,918) (10,981,122)
5,780,587 1,420,531 7,201,118
Reconciliation of segment assets to total assets:
Other assets 1,236,820 231,738 1,468,558
Total assets from continuing operations 7,017,407 1,652,269 8,669,676
(iii) Segment liabilities
United States Australia Total
$ $ $
As at 31 December 2023
Segment liabilities as at 1 July 2023 1,137,363 183,405 1,320,768
Segment liability increase/(decrease) for the period 270,220 74,412 344,632
1,407,583 257,817 1,665,400
Reconciliation of segment liabilities to total liabilities:
Other liabilities - - -
Total liabilities from continuing operations 1,407,583 257,817 1,665,400
As at 30 June 2023
Segment liabilities as at 1 July 2022 1,137,363 183,405 1,320,768
Segment liability increase/(decrease) for the period 14,805 45,964 60,769
1,152,168 229,369 1,381,537
Reconciliation of segment liabilities to total liabilities:
Other liabilities - - -
Total liabilities from continuing operations 1,152,168 229,369 1,381,537
12 Producing assets
The Group currently has 5 producing assets, which the Board monitors as
separate items to the geographical and operating
segments.
Project performance is monitored by the line items below.
Stanley Cinnabar Winters Livingston Arkoma Other Projects Total
$ $ $ $ $ $ $
Half-Year Ended 31 December 2023
Revenue
Oil and gas project related revenue 357,983 82,684 33,811 18,871 - 40,445 533,794
Producing assets revenue 357,983 82,684 33,811 18,871 - 40,445 533,794
Project-related expenses
- Cost of sales (16,495) (3,810) (1,253) (727) - - (22,285)
- Lease operating expenses (271,639) (88,992) (20,114) (5,814) - (90,891) (477,450)
Project cost of sales (288,134) (92,802) (21,367) (6,541) - (90,891) (499,735)
Project gross profit
Gross profit 69,849 (10,118) 12,444 12,330 - (50,446) 34,059
12 Producing assets (continued)
(i) Project performance
Stanley Cinnabar Winters Livingston Arkoma Other Projects Total
$ $ $ $ $ $ $
Half-Year Ended 31 December 2022
Revenue
Oil and gas project related revenue 679,263 - 158,563 17,823 42,813 37,725 936,187
Producing assets revenue 679,263 - 158,563 17,823 42,813 37,725 936,187
Project-related expenses
- Cost of sales (34,616) (10,997) (821) (3,082) - (49,516)
- Lease operating expenses (360,220) (53,211) (58,485) (12,186) (119,566) (603,668)
Project cost of sales (394,836) (64,208) (59,306) (15,268) (119,566) (653,184)
Project gross profit
Gross profit 284,427 94,355 (41,483) 27,545 (81,841) 283,003
Condensed Notes to the Financial Statements
For the Half-Year Ended 31 December 2023
All amounts are Australian Dollars
13 Expenditure Commitments
(a) Exploration
The Company has certain obligations to perform minimum exploration work on Oil
and Gas tenements held. These obligations may vary over time, depending on the
Company's exploration programs and priorities. At 31 December 2023, total
exploration expenditure commitments for the next 12 months are as follows:
Entity Tenement 31 December 2023 31 December 2022
$ $
Trident Energy Pty Ltd EP145(1) - -
Oilco Pty Ltd EPA155 - -
- -
1. EP145 is currently under extension until 21 August 2024, therefore
there are no committed expenditures as of the date of this report.
(b) Capital Commitments
The Company had no capital commitments at 31 December 2023 (2022 - $Nil).
14 Warrants
A summary of the movements of all company warrant issues to 31 December 2023
is as follows:
Company Warrants 31 December 2023 30 June 2023
Number of Options Number of Options
Outstanding at the beginning of the period 1,288,928,571 1,584,250,000
Expired - (896,750,000)
Granted 1,548,571,428 601,428,571
Outstanding at the end of the period 2,837,499,999 1,288,928,571
Exercisable at the end of the period 2,837,499,999 1,288,928,571
15 Subsequent Events
Subsequent to the end of the reporting period the Company announced the following material matters occurred:
· On 15 January 2024, the Group announced it had lodged the
Environmental Management Plan ("EMP") with the Northern Territory Government.
Approval of the EMP and re-issue of the Aboriginal Areas Protection Authority
('AAPA') Certificate are the two remaining approvals required prior to the
acquisition of 2D seismic, scheduled for 2024.
· On 23 January 2024, the Group announced that Mosman and Greenvale
Gas Ltd ("GRV"), a subsidiary of Greenvale Pty Ltd (ASX:GRV), had agreed to
amend the Farmin Agreement so that the right for either party to terminate the
agreement is changed from 31 January to 30 March 2024.
· On 2 February, the Group announced it had raised £300,000
(before expenses) by way of a placing of 2,400,000,000 ordinary shares at a
price of 0.0125 pence per share.
· On 7 February, the Group held and Extraordinary General Meeting,
where shareholder approval was received to issue 84,210,526 shares and
42,105,263 warrants to CEO Andrew Carroll, and 42,105,263 shares and
21,052,632 warrants to Chairman Nigel Harvey. Shares were issued for cash
consideration at 0.0125p per share. The warrants are exercisable at 0.025p
each with a two year expiry. All shares and warrants were issued on the same
terms as the placement announced on 29 November 2023.
There were no other material matters that occurred subsequent to 31 December
2023.
16 Dividends
No dividends have been paid or proposed during the half year ended 31 December
2023.
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