REG - Synergia Energy Ltd - Interim Financial Report
15/03/2023 07:15
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RNS Number : 0403T Synergia Energy Ltd 15 March 2023
http://www.rns-pdf.londonstockexchange.com/rns/0403T_1-2023-3-15.pdf
(http://www.rns-pdf.londonstockexchange.com/rns/0403T_1-2023-3-15.pdf)
SYNERGIA ENERGY LTD
INTERIM FINANCIAL REPORT
Six Months Ended 31 December 2022
REVIEW OF OPERATIONS
OVERVIEW AND STRATEGY
Consistent with the Company's strategy to focus on gas production and Carbon
Capture and Storage ("CCS"), Synergia's activities have centred on the
Company's Cambay gas and condensate field in India and on CCS opportunities in
the UK and recently, in India.
A significant development for the Company during the period was the successful
re-frac of the Cambay C-77H well facilitating progress towards a full field
development. To this end, a formal farm out process was instigated in Q4 2022
with a view to farming out up to 50% of the Cambay PSC to a suitable JV
partner.
In addition, the Company added a further CCS project in the form of the
conceptual Cambay CCS scheme which we believe not only leverages our Company's
expertise in this sector but also has the potential to make a material impact
on India's carbon emissions reduction aspirations.
Due to the continued high gas prices, the Company has put its search for
mature producing gas assets in the UK Continental Shelf area on hold.
Cambay Field, Onshore Gujarat, India
(Synergia Energy: Operator and 100% Participating Interest)
The Cambay field was placed on production following a lengthy hiatus in April
2022. The Company's primary producing well, C-77H, provided the majority of
the field's production during the period even though it was shut in for
approximately 2 months during the re-frac operation. Prior to the re-frac, the
original 4 fracked zones were unable to provide sustained production due to
liquid loading which necessitated the frequent shutting in of the well to
allow wellhead pressure to be restored. It was believed that the 4 zones had
been fracked sub-optimally.
In order to prove up a new fracking methodology, a bridge plug was set above
the original 4 fracked zones to isolate them from 2 new fracked zones at the
heel of the well. The 2 new zones were fracked in July 2022 and following a
lengthy clean-up process, the well finally provided stable and constant gas
production at up to 275,000 SCFD despite the existence of a c.1500m column of
condensate. Through the period end the C-77H well exhibited plateau production
which verified the new fracking methodology and provides a template for future
new wells.
The C-77H re-frac operation confirmed the need for an artificial lift ("AL")
solution for Eocene wells in order to optimise gas and gas condensate
production. Progressive cavity pumps ("PCP") were considered the best AL
solution and an evaluation of PCP configuration was commenced in conjunction
with the preferred supplier, PCM. Due to elastomer compatibility and
availability problems, the Company is evaluating a jet pump AL solution.
Based on the C-77H re-frac results, the Company believes new multi-zone and
fracked horizontal Eocene wells with AL can be drilled with initial production
rates of 4 mmscfd and 40% annual decline rates.
A formal farm out process commenced in October 2022 with a view to farming out
up to 50% of the Cambay PSC. The process is being managed by Moyes &
Company. The primary objective of the farm out is to facilitate the
commencement of a full field development of the Cambay field in H2 2023.
In November 2022, oil production from C-19z, C-20, C63 and C72 started to
augment the gas and condensate production from C-77H and C-73.
Cambay CCS Scheme
Leveraging its CCS expertise and experience in the UK, the Company has
developed a CCS scheme in India based on CO(2) storage in the extensive Olpad
Formation which extends under the Cambay producing reservoirs. The scheme
proposes the capture of CO(2) emitted from the many gas and coal-fired power
stations in the vicinity of the Cambay field. CO(2) would be transported via
pipeline to a CCS hub on the Cambay field for injection into the Olpad
Formation for permanent storage.
Further technical studies will be required to confirm the suitability of the
Olpad Formation. In addition to the securing of funding, the necessary
regulatory and commercial frameworks will need to be developed in order to
bring this significant CCS scheme to fruition.
United Kingdom Continental Shelf
Carbon Capture and Storage ("CCS")
Due to a potential overlap of CCS and windfarm activities in the area around
the Esmond and Forbes fields, these areas were excluded by the NSTA from the
licensing round. Consequently, the Company undertook extensive technical
evaluation of two alternative licensing areas incorporating a mix of depleted
gas reservoirs and aquifers. The Company made two carbon storage license
applications under the NSTA's first carbon storage licensing round. The
licenses are planned to form part of Synergia's Medway Hub CCS project. It is
anticipated that the NSTA will commence the award of licenses at the end of
calendar Q1 2023.
JPDA 06-103, Timor Sea
Under the terms of the Deed of Settlement and Release, the final instalment of
US$250,000 (out of the original US$800,000) was made to Autoridade Nacional Do
Petroleo E Minerais ("ANPM") on 7 September 2022.
The movement in the loan payable relating to the settlement during the period
is detailed in Note 12 to the condensed consolidated interim financial report,
which shows balance of the loan from Japan Energy E&P JPDA Pty Ltd ("JX")
being at US$440,970 at 31 December 2022. At report date, the balance of the
loan from JX was approximately US$253,549, following a repayment to JX of
US$196,754 on 13 February 2023.
The balance of the loan from JX at reporting date, plus interest, is to be
repaid to JX in August 2023, upon the loan's maturity on 17 August 2023.
During the period, the non-defaulting parties to the JPDA joint venture agreed
to terminate the Joint Operating Agreement. Synergia Energy will be
progressing the final closure of the joint venture accounts to conclude this
matter.
West Kampar PSC, Central Sumatra, Indonesia
During the half-year, the Company was advised that its efforts to regain a
participating interest and control of the West Kampar PSC in Indonesia were
unsuccessful. The Company understands that the West Kampar PSC was awarded to
a third party. This marks the end of the Company's activities in Indonesia.
Qualified Person
The technical information contained in the above disclosure has been prepared
by or under the supervision of Mr Jonathan Salomon (B App Sc (Geology),
GAICD), Executive Chairman employed by Synergia Energy Ltd. Mr Salomon has
over 36 years' experience in petroleum geology and is a member of the American
Association of Petroleum Geologists, and the Society of Petroleum Engineers.
Mr Salomon meets the requirements of and acts as the Qualified Person under
the Alternative Investment Market Rules - AIM Note for Mining and Oil &
Gas Companies, and consents to the inclusion of this information in this
report in the form and context in which it appears.
PERMIT SCHEDULE
PETROLEUM PERMIT SCHEDULE - 31 DECEMBER 2022
ASSET LOCATION ENTITY CHANGE IN INTEREST DURING THE PERIOD % EQUITY % OPERATOR
Cambay Field PSC Gujarat, India Synergia Energy Ltd - 85.0 Synergia Energy Ltd
Oilex N.L. Holdings (India) Limited - 15.0
DIRECTORS' REPORT
FOR THE HALF-YEAR ENDED 31 DECEMBER 2022
The directors present their report together with the condensed interim
financial report of the group comprising of Synergia Energy Ltd (the "Company"
or "Synergia Energy") and its subsidiaries (together collectively referred to
as the "Group") for the half-year ended 31 December 2022 and the auditor's
review report thereon.
DIRECTORS
The directors of the Company at any time during the interim period and until
the date of this report are detailed below. All directors were in office for
this entire period unless otherwise stated.
Mr Jonathan Salomon Executive Chairman
Mr Roland Wessel Chief Executive Officer ("CEO") and
Executive Director
Mr Colin Judd Chief Financial Officer ("CFO") and
Executive Director
Mr Mark Bolton Non-Executive Director
Mr Paul Haywood Independent Non-Executive Director
Mr Peter Schwarz Independent Non-Executive Director
REVIEW OF OPERATIONS
A review of the operations of the Group during the financial period and the
results of those operations are set out in the Review of Operations on pages 1
to 3 of this report.
FINANCIAL AND OPERATING RESULTS
The Group incurred a consolidated loss after income tax of $3,674,813 for the
half-year (31 December 2021: loss of $2,235,196).
During the half-year, production continued on the Cambay field together with
oil and gas sales following recommencement of production which happened in
April 2022. Oil sales during the half-year amounted to $294,053 (31 December
2021: $nil) and gas sales amounted to $396,767 (31 December 2021: $nil),
providing total revenues of $690,820 during the half-year (31 December 2021:
$nil). Cost of sales including production costs incurred during the half-year
amounted to $2,380,919 (31 December 2021: $nil), which included re‑fraccing
costs of $1,845,527 (31 December 2021: $nil). This resulted in the Group
incurring a gross loss of $1,690,099 during the half-year (31 December 2021:
$nil).
The prior period results included care and maintenance expenditure of $187,908
(which included re‑fraccing preparation costs of $113,416 up to December
2021), with no care and maintenance expenditure recorded in the current period
due to the recommencement of production in April 2022.
The expected credit losses incurred during the half-year were significantly
reduced to $22,712 (from $238,514 during the half-year ended 31 December 2021)
mainly due to GSPC no longer being a 55% joint venture partner in Cambay since
the previous financial year on 4 February 2022. This also resulted in
exploration expenditure reducing to $385,788 (from $493,111 during the
half-year ended 31 December 2021) as no additional accrual of exploration
expenditure was required as at 31 December 2022 (31 December 2021: $129,613
additional exploration expenditure required).
Net finance costs including net foreign exchange losses increased during the
half-year to $236,515 (31 December 2021: $129,509), mainly due to an increase
in the unwinding of discount on site restoration provision to $144,632 during
the half-year (31 December 2021: $25,147).
Cash and cash equivalents held by the Group as at 31 December 2022 has
decreased to $1,364,423 (at 30 June 2022: $4,838,459). The Group's borrowings
as at 31 December 2022 increased to $650,878 (at 30 June 2022: $451,355).
MATERIAL UNCERTAINTY RELATED TO GOING CONCERN
The auditor's review report contains a statement of material uncertainty
regarding the Company's ability to continue as a going concern. The
consolidated financial statements have been prepared on a going concern basis,
which contemplates continuity of normal business activities and the
realisation of assets and settlement of liabilities in the ordinary course of
business.
The funding requirements of the Group are reviewed on a regular basis by the
Group's Executive Directors and are reported to the Board at each board
meeting to ensure the Group can meet its financial obligations as and when
they fall due. In this regard, please refer to the note below concerning the
raising of £650,000 by way of a convertible loan note agreement subsequent to
the balance date. This loan will be utilised for working capital purposes.
Cambay's gas and oil production and associated revenue streams recommenced in
the six months to 31 December 2022 but, until sufficient operating cash flows
are generated from its operations, the Group remains reliant on equity
raisings, joint venture contributions or debt funding, as well as asset
divestitures or farmouts to fund its expenditure commitments.
The Group will require additional funding in due course to continue its
exploration activities, progress the Cambay development and drilling
programme, repay its loan balance, meet its ongoing administrative expenses,
and for any new business opportunities that the Group may pursue.
Further information on the Group's going concern basis of preparation is
provided in Note 2(c) of the consolidated financial statements.
CORPORATE
Following shareholder approval received at the 13 July 2022 General Meeting,
174,831,394 fully paid ordinary shares ("shares") were issued at £0.002
($0.0035) per share raising approximately £350k ($608k) before costs. The
shares were the final instalment of the placement previously arranged and
announced on 4 May 2022. 69,932,558 shares out of 174,831,394 shares were
issued on 21 July 2022 and the remaining 104,898,836 shares were issued on 3
August 2022.
Following the issue of these shares, 30,000,000 unlisted options exercisable
at £0.002 each and expiring on or before 30 April 2024 were issued on 13
September 2022. These unlisted options were issued to Novum Securities Limited
("Novum") for their role as Lead Manager pursuant to the capital raising
advisory agreement relating to the May 2022 placement.
As at 31 December 2022, the Company had:
· Available cash resources of $1,364,423;
· Borrowings of $650,878; and
· Issued capital of 8,417,790,704 fully paid ordinary shares and
379,885,408 unlisted options.
SIGNIFICANT EVENTS AFTER BALANCE DATE
On 13 February 2023, the Company made a repayment to JX of US$196,754.
Following the repayment and further interest accrued, at report date, the
balance of the loan from JX is approximately US$253,549.
On 22 February 2023, the Company announced that it entered into a convertible
loan agreement with certain sophisticated and/or professional existing and new
shareholders to secure a new convertible loan facility of £650,000. The
convertible loan proceeds were received by the Company between 23 February
2023 and 9 March 2023 and will be used for working capital purposes. Under
the terms of the agreement, and as a consequence of the receipt date of the
funds, the option date and maturity date were extended to 9 December 2023 and
9 March 2024 respectively.
A summary of the key terms of the convertible loan facility is disclosed in
Note 12 to the condensed consolidated interim financial report.
There were no other significant subsequent events occurring after the
half-year end.
LEAD AUDITOR'S INDEPENDENCE DECLARATION
The lead auditor's independence declaration is set out on page 8 and forms
part of the Directors' Report for the half-year ended 31 December 2022.
Signed in accordance with a resolution of the Board of Directors.
Mr Jonathan
Salomon
Roland Wessel
Executive
Chairman
Chief Executive Officer and Director
West Perth, Western Australia
15 March 2023
AUDITOR'S INDEPENDENCE DECLARATION
TO THE DIRECTORS OF SYNERGIA ENERGY LTD
In relation to our review of the financial report of Synergia Energy Ltd for
the half year ended 31 December 2022, to the best of my knowledge and belief,
there have been no contraventions of the auditor independence requirements of
the Corporations Act 2001 or any applicable code of professional conduct.
PKF Perth
Shane Cross
Partner
15 March 2023
West Perth,
Western Australia
Level 4, 35 Havelock Street, West Perth, WA 6005
PO Box 609, West Perth, WA
6872
T: +61 8 9426 8999 F: +61 8 9426 8900 www.pkfperth.com.au
PKF Perth is a member firm of the PKF International Limited family of legally
independent firms and does not accept any responsibility or liability for the
actions or inactions of any individual member or correspondent firm or firms.
Liability limited by a scheme approved under Professional Standards
Legislation.
CONDENSED CONSOLIDATED STATEMENT OF PROFIT OR LOSS
AND OTHER COMPREHENSIVE INCOME
FOR THE HALF-YEAR ENDED 31 DECEMBER 2022
Note 31 December 2022 31 December 2021
$ $
Revenue 6(a) 690,820 -
Cost of sales 6(b) (2,380,919) -
Gross Profit (1,690,099) -
Exploration expenditure (385,788) (493,111)
Care and maintenance expenditure 6(c) - (187,908)
Administration expense 6(d) (1,251,915) (1,150,753)
Expected credit losses expense 7 (22,712) (238,514)
Share-based payments expense 17 (84,094) (19,489)
Other expenses 6(e) (3,689) (15,912)
Results from Operating Activities (3,438,297) (2,105,687)
Finance income 6(f) 158 189
Finance costs 6(g) (180,650) (123,466)
Net foreign exchange loss 6(h) (56,024) (6,232)
Net Finance Costs (236,516) (129,509)
Loss Before Tax from Continuing Operations (3,674,813) (2,235,196)
Income tax expense - -
Loss for the Period from Continuing Operations (3,674,813) (2,235,196)
Profit after tax for the period from discontinued operations - -
Loss for the Period (3,674,813) (2,235,196)
Other Comprehensive Income
Items that may be reclassified subsequently to profit or loss
Foreign exchange differences on translation of foreign operations 74,357 129,406
Other Comprehensive Income for the Period, Net of Income Tax 74,357 129,406
Total Comprehensive Loss for the Period (3,600,456) (2,105,790)
Loss per Share from Continuing
and Discontinued Operations
Basic loss per share (cents per share) (0.04) (0.04)
Diluted loss per share (cents per share) (0.04) (0.04)
The above Condensed Consolidated Statement of Profit or Loss and Other
Comprehensive Income is to be read in conjunction with the accompanying notes.
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2022
Note 31 December 2022 30 June 2022
$ $
Assets
Cash and cash equivalents 1,364,423 4,838,459
Trade and other receivables 7 477,906 127,058
Prepayments 10,454 15,617
Inventories 99,107 387,685
Investments 8 69,185 69,185
Total Current Assets 2,021,075 5,438,004
Development assets 9 20,540,522 20,310,614
Plant and equipment 28,105 29,830
Total Non-Current Assets 20,568,627 20,340,444
Total Assets 22,589,702 25,778,448
Liabilities
Trade and other payables 10 889,566 1,729,185
Employee benefits 11 195,717 180,827
Borrowings 12 650,878 451,355
Total Current Liabilities 1,736,161 2,361,367
Provisions 11 9,125,394 8,833,483
Total Non-Current Liabilities 9,125,394 8,833,483
Total Liabilities 10,861,555 11,194,850
Net Assets 11,728,147 14,583,598
Equity
Issued capital 16 192,817,143 192,181,384
Reserves 7,982,467 7,798,864
Accumulated losses (189,071,463) (185,396,650)
Total Equity 11,728,147 14,583,598
The above Condensed Consolidated Statement of Financial Position is to be read
in conjunction with the accompanying notes.
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE HALF-YEAR ENDED 31 DECEMBER 2022
Attributable to Owners of the Company
Issued Capital Share-Based Payments Reserve Foreign Currency Translation Reserve Accumulated Losses Total Equity
Note $ $ $ $ $
Balance at 1 July 2022 192,181,384 221,321 7,577,543 (185,396,650) 14,583,598
Total Comprehensive Income/(Loss)
Loss for the period - - - (3,674,813) (3,674,813)
Other Comprehensive Income
Foreign currency translation differences - - 74,357 - 74,357
Total Other Comprehensive Income - - 74,357 - 74,357
Total Comprehensive Income/(Loss) - - 74,357 (3,674,813) (3,600,456)
for the Period
Transactions with Owners of the Company
Contributions and Distributions
Shares issued 16 608,378 - - - 608,378
Capital raising costs ((1) ) 16 27,381 - - - 27,381
Share-based payment transactions 17 - 109,246 - - 109,246
Total Transactions with Owners 635,759 109,246 - - 745,005
of the Company
Balance at 31 December 2022 192,817,143 330,567 7,651,900 (189,071,463) 11,728,147
Balance at 1 July 2021 185,355,925 - 7,096,752 (183,469,774) 8,982,903
Total Comprehensive Income/(Loss)
Loss after tax for the period - - - (2,235,196) (2,235,196)
Other Comprehensive Income
Foreign currency translation differences - - 129,406 - 129,406
Total Other Comprehensive Income - - 129,406 - 129,406
Total Comprehensive Income/(Loss) - - 129,406 (2,235,196) (2,105,790)
for the Period
Transactions with Owners of the Company
Contributions and Distributions
Shares issued for cash 1,485,195 - - - 1,485,195
Capital raising costs ((1) ) (384,845) - - - (384,845)
Share-based payment transactions 17 19,489 53,133 - - 72,622
Total Transactions with Owners 1,119,839 53,133 - - 1,172,972
of the Company
Balance at 31 December 2021 186,475,764 53,133 7,226,158 (185,704,970) 8,050,085
((1) ) Capital raising costs include cash payments and the fair
value of options granted to the underwriter.
The above Condensed Consolidated Statement of Changes in Equity is to be read
in conjunction with the accompanying notes.
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE HALF-YEAR ENDED 31 DECEMBER 2022
31 December 2022 31 December 2021
$ $
Cash Flows from Operating Activities
Cash receipts from customers 467,308 -
Recovery of prior period operating costs 52,539 510,644
Payments to suppliers and employees (3,771,568) (1,543,727)
Repayment of JPDA 06-103 PSC termination penalty (372,523) (348,481)
Cash outflows from operations (3,624,244) (1,381,564)
Payments for exploration and evaluation expenses (442,433) (349,347)
Interest received 158 189
Interest paid (4,790) (3,931)
Net Cash Used in Operating Activities (4,071,309) (1,734,653)
Cash Flows from Investing Activities
Payment for deposit for Cambay Acquisition (paid to bank guarantee and later - (2,903,141)
called upon by GSPC)
Payments for capitalised exploration and evaluation - (7,352)
Acquisition of plant and equipment - (26,621)
Proceeds from sale of other investments - 118,694
Net Cash Used in Investing Activities - (2,818,420)
Cash Flows from Financing Activities
Proceeds from issue of share capital 608,378 1,485,195
Payment for share issue costs (106,168) (141,361)
Proceeds from borrowings 372,523 348,481
Repayment of borrowings (199,906) (23,404)
Net Cash from Financing Activities 674,827 1,668,911
Net Decrease in Cash and Cash Equivalents (3,396,482) (2,884,162)
Cash and cash equivalents at 1 July 4,838,459 4,310,767
Effect of exchange rate fluctuations on cash held (77,554) (1,191)
Cash and Cash Equivalents at 31 December 1,364,423 1,425,414
The above Condensed Consolidated Statement of Cash Flows is to be read in
conjunction with the accompanying note
NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL REPORT
FOR THE HALF-YEAR ENDED 31 DECEMBER 2022
1. REPORTING ENTITY
Synergia Energy Ltd (the "Company") is a for-profit entity domiciled in
Australia. The condensed consolidated interim financial report as at and for
the half-year ended 31 December 2022 comprise the Company and its subsidiaries
(collectively the "Group" and individually "Group Entities"). Synergia Energy
Ltd is a company limited by shares incorporated in Australia whose shares are
publicly traded on the Alternative Investment Market ("AIM") of the London
Stock Exchange ("LSE"). The Company's shares were also recently publicly
traded on the Australian Securities Exchange ("ASX") until its delisting from
the ASX on 30 December 2022.
The Group is primarily involved in the exploration, evaluation, development
and production of hydrocarbons.
The consolidated annual financial report of the Group as at and for the year
ended 30 June 2022 is available upon request from the Company's registered
office at Level 1, 11 Lucknow Place, West Perth, Western Australia 6005 or at
www.synergiaenergy.com (http://www.synergiaenergy.com) .
2. BASIS OF PREPARATION
(a) Presentation Currency
The condensed consolidated interim financial report is presented in Australian
Dollars ("$"), unless otherwise stated.
(b) Statement of Compliance
The condensed consolidated interim financial report is a general purpose
condensed financial report which has been prepared in accordance with
Accounting Standard AASB 134 Interim Financial Reporting and the Corporations
Act 2001, and IAS 34 Interim Financial Reporting. The condensed consolidated
interim financial report does not include all of the notes and information
included in an annual financial report and accordingly this report should be
read in conjunction with the consolidated annual financial report of the Group
as at and for the year ended 30 June 2022.
The Company is a company of the kind referred to in ASIC Corporations
(Rounding in Financials/Directors' Reports) Instrument 2016/191, dated 24
March 2016, and in accordance with that Corporations Instrument amounts in the
half-year financial report are rounded off to the nearest dollar, unless
otherwise indicated.
This condensed consolidated interim financial report was authorised for issue
by the Board of Directors on 15 March 2023.
(c) Going Concern Basis
The Directors believe it is appropriate to prepare the consolidated financial
statements on a going concern basis, which contemplates continuity of normal
business activities and the realisation of assets and settlement of
liabilities in the ordinary course of business.
The Group incurred a loss of $3,674,813 (half-year ended 31 December 2021:
$2,235,196) and had cash outflows from operating activities of $4,071,309
(half-year ended 31 December 2021: $1,734,653). The Group concluded the
half-year at 31 December 2022 with cash and cash equivalents of $1,364,423 (at
30 June 2022: $4,838,459) and had loans outstanding at period end of $650,878
(at 30 June 2022: $451,355).
On 22 February 2023, the Company announced that it entered into a convertible
loan agreement with certain sophisticated and/or professional existing and new
shareholders to secure a new convertible loan facility of £650,000. The
convertible loan proceeds were received by the Company between 23 February
2023 and 9 March 2023 and will be used for working capital purposes.
The Group also requires further funding within the next twelve months in order
to repay its loan balance, continue its exploration activities, progress the
Cambay development and drilling programme, meet its ongoing administrative
expenses, and for any new business opportunities that the Group may pursue.
The Directors believe that the Group will be able to secure sufficient funding
to meet the requirements to continue as a going concern, due to its history of
previous capital raisings, acknowledging that the structure and timing of any
capital raising is dependent upon investor support, prevailing capital
markets, shareholder participation, oil and gas prices and the outcome of
planned exploration and evaluation activities, which creates uncertainty.
The Directors consider the going concern basis of preparation to be
appropriate based on its forecast cash flows for the next twelve months and
that the Group will be in a position to continue to meet its minimum
administrative, evaluation and development expenditures and commitments for at
least twelve months from the date of this report.
If further funds are not able to be raised or realised, then it may be
necessary for the Group to sell or farmout its exploration and development
assets and to reduce discretionary administrative expenditure.
The ability of the Group to achieve its forecast cash flows, particularly the
raising of additional funds, represents a material uncertainty that may cast
significant doubt about whether the Group can continue as a going concern, in
which case it may not be able to realise its assets and extinguish its
liabilities in the normal course of business and at the stated amounts in the
financial statements.
3. SIGNIFICANT ACCOUNTING POLICIES
The accounting policies applied by the Group in this condensed consolidated
interim financial report are the same as those applied by the Group in its
consolidated financial report as at and for the year ended 30 June 2022.
New or Amended Accounting Standards and Interpretations Adopted
The Group has adopted all of the new or amended Accounting Standards and
Interpretations issued by the Australian Accounting Standards Board ("AASB")
that are mandatory for the current reporting period.
Any new or amended accounting standards, interpretations and other accounting
pronouncements that are not yet mandatory have not been early adopted.
4. ESTIMATES AND JUDGEMENTS
The preparation of a condensed consolidated interim financial report requires
management to make judgements, estimates and assumptions that affect the
application of accounting policies and the reported amounts of assets and
liabilities, income and expense. Actual results may differ from these
estimates.
In preparing this condensed consolidated interim financial report, the
significant judgements made by management in applying the Group's accounting
policies and the key sources of estimation uncertainty were the same as those
that applied to the consolidated financial report as at and for the year ended
30 June 2022.
5. OPERATING SEGMENTS
The Group has identified its operating segments based upon the internal
reports that are reviewed and used by the executive management team in
assessing performance and that are used to allocate the Group's resources.
There has been no change in the basis of segmentation from the Group's 30 June
2022 annual consolidated financial report.
India JPDA ((1)) Indonesia United Kingdom Corporate ((2)) Consolidated
31 Dec 31 Dec 31 Dec 2022 31 Dec 2021 31 Dec 2022 31 Dec 2021 31 Dec 2022 31 Dec 2021 31 Dec 2022 31 Dec 2021 31 Dec 31 Dec
2022
2021
2022
2021
6 Months Ended 31 December $ $ $ $ $ $ $ $ $ $ $ $
Revenue
External revenue 690,820 - - - - - - - - - 690,820 -
Gross Loss (1,690,099) - - - - - - - - - (1,690,099) -
Reportable Segment (Loss)/Profit Before Income Tax (2,037,985) (925,413) (9,054) (23,513) 62,867 (11,904) (80,304) (7,468) (1,373,821) (1,137,389) (3,438,297) (2,105,687)
Net finance costs (180,492) (123,277)
Foreign exchange loss (56,024) (6,232)
Income tax expense - -
Net Loss for the Period (3,674,813) (2,235,196)
India JPDA ((1)) Indonesia United Kingdom Corporate ((2)) Consolidated
31 Dec 30 June 2022 31 Dec 2022 30 June 2022 31 Dec 2022 30 June 2022 31 Dec 2022 30 June 2022 31 Dec 2022 30 June 2022 31 Dec 30 June 2022
2022
2022
$ $ $ $ $ $ $ $ $ $ $ $
Segment Assets 21,812,333 19,426,958 5,451 10,657 - - - - 771,918 6,340,833 22,589,702 25,778,448
Segment Liabilities 9,822,654 9,823,249 4,765 372,034 17,261 86,190 6,055 - 1,010,820 913,377 10,861,555 11,194,850
There were no significant inter-segment transactions during the half-year.
((1)) Joint Petroleum Development Area.
((2)) Corporate represents a reconciliation of reportable segment revenues,
profit or loss and assets to the consolidated figure.
6. REVENUE AND EXPENSES
31 December 2022 31 December 2021
$ $
(a) Revenue
Oil sales 294,053 -
Gas sales 396,767 -
690,820 -
(b) Cost of Sales
Production costs (2,072,613) -
Amortisation of development assets (5,865) -
Movement in oil stocks inventory (302,441) -
(2,380,919) -
(c) Care and Maintenance Expenditure
Care and maintenance costs - (185,134)
Movement in oil stocks inventory - (2,774)
- (187,908)
(d) Administration Expenses
Employee benefits expense (647,592) (470,694)
Administration expense (604,323) (680,059)
(1,251,915) (1,150,753)
(e) Other Expenses
Depreciation expense (3,689) (11,385)
Loss on disposal of plant and equipment - (4,527)
(3,689) (15,912)
(f) Finance Income
Interest income 158 189
158 189
(g) Finance Costs
Interest expense - borrowings (36,018) (4,827)
Unwinding of discount on site restoration provision (144,632) (25,147)
Equity securities designated at FVTPL - net change in fair value - (93,492)
(180,650) (123,466)
(h) Foreign Exchange Loss - Net
Foreign exchange loss - realised 9,920 -
Foreign exchange loss - unrealised (65,944) (6,232)
(56,024) (6,232)
7. TRADE AND OTHER RECEIVABLES
31 December 2022 30 June 2022
$ $
Current
Allocation of Receivables
Joint venture receivables 33,626 43,543
Other receivables 444,280 83,515
477,906 127,058
Joint Venture Receivables
Joint venture receivables 411,149 400,341
Provision for expected credited losses (377,523) (356,798)
33,626 43,543
Other Receivables
Corporate receivables 481,639 114,859
Provision for expected credited losses (37,359) (31,344)
444,280 83,515
Joint venture receivables include the Group's share of outstanding cash calls
and recharges owing from joint venture partners, as well as other minor
receivables.
The Group considers that there is evidence of impairment if any of the
following indicators are present: financial difficulties of the debtor,
probability that the debtor will dispute amounts owing and default or
delinquency in payment (more than one year old). Each receivable has been
assessed individually for recovery, and those deemed to have a low chance of
recovery have been fully provided for in the current period. The carrying
value of trade and other receivables approximates its fair value due to the
assessment of recoverability.
Allocation of Provision for Expected Credit Losses 31 December 2022 30 June 2022
$ $
Joint venture receivables (377,523) (356,798)
Other receivables (37,359) (31,344)
(414,882) (388,142)
Movement in Provision for Expected Credit Losses Half-Year Ended 31 December 2022
$
Balance at 1 July 2022 (388,142)
Expected credit losses incurred during the period (22,712)
Effect of movements in exchange rates (4,028)
Balance at 31 December 2022 (414,882)
8. INVESTMENTS, INCLUDING DERIVATIVES
31 December 2022 30 June 2022
$ $
Current Investments
Equity securities - designated at FVTPL 69,185 69,185
69,185 69,185
At 31 December 2022, the Group had 11,530,847 Armour shares on hand (at 30
June 2022: 11,530,847 Armour shares on hand).
Fair Value Measurement
The fair value measurement of the equity securities has been determined using
a three-level hierarchy, based on the lowest level of input that is
significant to the entire fair value measurement, being:
Level 1: Quoted prices (unadjusted) in active markets for identical assets
that the Group can access at the measurement date
Level 2: Inputs other than quoted prices included within Level 1 that are
observable for the asset, either directly or indirectly
Level 3: Unobservable inputs for the asset
Equity securities - designated as at FVTPL have been valued using quoted
market rates (Level 1). This valuation technique maximises the use of
observable market data where it is available and relies as little as possible
on entity specific estimates.
Dividends
Dividends received are recognised as other income by the Company when the
right to receive payment is established.
9. DEVELOPMENT ASSETS
Non-Current 31 December 2022 30 June 2022
$ $
Allocation of Development Assets
Cambay development asset 11,679,122 11,595,853
Cambay restoration asset 8,861,400 8,714,761
Carrying Amounts - Total 20,540,522 20,310,614
Movement in Carrying Amount - Cambay Development Asset Half-Year Ended
31 December 2022
$
Cost - Cambay Development Assets
Balance at 1 July 2022 33,617,561
Effect of movements in foreign exchange rates (809,662)
Balance at 31 December 2022 32,807,899
Amortisation and Impairment Losses - Cambay Development Asset
Balance at 1 July 2022 (22,021,708)
Amortisation charge for the period (5,865)
Effect of movements in foreign exchange rates 898,796
Balance at 31 December 2022 (21,128,777)
Carrying Amount - Cambay Development Asset 11,679,122
Movement in Carrying Amount - Cambay Restoration Asset
Cost - Cambay Restoration Asset
Balance at 1 July 2022 8,714,761
Effect of movements in foreign exchange rates 146,639
Balance at 31 December 2022 8,861,400
Amortisation and Impairment Losses - Cambay Restoration Asset
Balance at 1 July 2022 -
Effect of movements in foreign exchange rates -
Balance at 31 December 2022 -
Carrying Amount - Cambay Restoration Asset 8,861,400
Carrying Amounts - Total
At 1 July 2022 20,310,614
At 31 December 2022 20,540,522
Cambay Field Development Assets
Development assets are reviewed at each reporting date to determine whether
there is any indication of impairment or reversal of impairment. Indicators of
impairment can include changes in market conditions, future oil and gas prices
and future costs.
Based on a review of key assumptions, no impairment indicators were identified
as at 31 December 2022. As such no impairment charges were applied to the
Cambay Field development assets during the financial half-year ended 31
December 2022. Also, no further reassessment was made of the restoration asset
and provision as at 31 December 2022, the last reassessment of the restoration
asset and provision being made during the year ended 30 June 2022 (refer to
the consolidated annual financial report of the Group as at and for the year
ended 30 June 2022).
10. TRADE AND OTHER PAYABLES
31 December 2022 30 June 2022
$ $
Current
Trade creditors 284,656 285,127
Accruals 604,910 1,081,161
Termination penalty payable (JPDA 06-103 PSC) - 362,897
889,566 1,729,185
Trade and Other Payables
The carrying value of trade and other payables is considered to approximate
its fair value due to the short-term nature of these financial liabilities.
Termination Penalty Payable (JPDA 06-103 PSC) Half-Year Ended
31 December 2022
$
Movement in Termination Penalty Payable Balance During the Half-Year
Balance at 1 July 2022 362,897
Repayment of termination penalty (US$250,000) (372,523)
Effect of movements in exchange rates 9,626
Balance at 31 December 2022 -
The termination penalty payable was payable to Autoridade Nacional Do Petroleo
E Minerais ("ANPM"). The final instalment of the termination penalty
(US$250,000) was paid to ANPM on 7 September 2022, thereby fully
extinguishing the Group's obligations to ANPM.
11. PROVISIONS
31 December 2022 30 June 2022
$ $
Current - Employee Benefits 195,717 180,827
Non-Current - Site Restoration and Well Abandonment 9,125,394 8,833,483
9,321,111 9,014,310
Movement in Provision for Site Restoration and Half-Year Ended
Well Abandonment During the Half-Year
31 December 2022
$
Balance at 1 July 2022 8,833,483
Unwinding of discount on site restoration provision 144,632
Effect of movements in exchange rates 147,279
Balance at 31 December 2022 9,125,394
12. BORROWINGS
31 December 2022 30 June 2022
$ $
Unsecured loan 650,878 451,355
650,878 451,355
Terms and Repayment Schedule of US$800,000 Loan Facility
The above relates to an unsecured loan facility agreement for US$800,000,
which the Company entered into during the financial year ended 30 June 2021
with two of its JPDA joint venture partners, and which was restricted to fund
the settlement of the termination penalty payable to ANPM (see Note 10).
At 31 December 2022, the terms and conditions of the US$800,000 loan facility
is as follows:
31 December 2022 30 June 2022
$ $
Currency Nominal Interest Rate Year of Maturity Face Carrying Amount Face Carrying Amount
Value
Value
US$800,000 loan facility USD 11.0% 2023 650,878 650,878 451,355 451,355
650,878 650,878 451,355 451,355
The movement of the loan during the half-year was as follows:
Movement in Loan Balance Half-Year Ended
31 December 2022
$
Balance at 1 July 2022 (US$310,938) 451,355
Repayments made to lender (US$140,414) (199,906)
Amounts drawn down to pay termination penalty (US$250,000) 372,523
Interest on facility balance (US$20,446) 31,228
Effect of movements in exchange rates (4,322)
Balance at 31 December 2022 (US$440,970) 650,878
The interest rate of the loan facility is 11% and the balance of the loan,
plus interest, is to be repaid to Japan Energy E&P JPDA Pty Ltd ("JX") in
two instalments (US$196,754 which was repaid on 13 February 2023 and the
remaining to be repaid in August 2023), prior to the loan's maturity on
17 August 2023.
Subsequent Event:
As mentioned above, on 13 February 2023, the Company made a repayment to JX of
US$196,754. Following the repayment and further interest accrued, at report
date, the balance of the loan from JX is approximately US$253,549.
In addition, on 22 February 2023, the Company announced that it entered into a
convertible loan agreement with certain sophisticated and/or professional
existing and new shareholders to secure a new convertible loan facility of
£650,000.
Summary of Key Terms of the Convertible Loan Facility:
Maturity Date: 9 March 2024 (()(2))
Option Date: 9 December 2023 (()(2))
Interest Rate: 5%
Conversion Terms: Option to convert the loan and interest payable (to that point) in the period
between the Option Date and the Maturity Date. If conversion elected, loan
principal and accrued interest is payable by the Company in new fully paid
ordinary shares ("Common Shares") at a £0.0008 conversion price, equating to
a maximum issue of, in aggregate, 853,125,000 new Common Shares.
Repayment Terms: No option for the Company to elect to repay ahead of Maturity Date, or for the
Company to elect repayment to be made in cash.
Security: Unsecured
Arrangement Fee: None
Note:
(1) ) Standard form representations and warranties have been agreed
between the Company and the convertible loan lenders.
(2) ) The convertible loan proceeds were received by the Company
between 23 February 2023 and 9 March 2023 and, as a consequence, the option
date and the maturity date were extended to 9 December 2023 and 9 March 2024
respectively.
13. LEASES
Rental Lease Commitments
31 December 2022 30 June 2022
$ $
Within one year 49,755 36,480
One year or later and no later than five years - -
49,755 36,480
Expenses Related to Short-Term or Low Value Leases
31 December 2022 31 December 2021
$ $
Operating lease rentals expensed during the half-year 36,737 13,121
14. EXPENDITURE COMMITMENTS
Exploration Expenditure Commitments
In order to maintain rights of tenure to exploration permits, the Group is
required to perform exploration work to meet the minimum expenditure
requirements specified by various state and national governments. These
obligations are subject to renegotiation when an application for an
exploration permit is made and at other times. These obligations are not
provided for in the financial report. The expenditure commitments are
currently estimated to be $nil (30 June 2022: $nil).
There are no minimum exploration work commitments in the Cambay Production
Sharing Contract.
When obligations expire, are renegotiated, or cease to be contractually or
practically enforceable, they are no longer considered to be a commitment.
Further expenditure commitments for subsequent permit periods are contingent
upon future exploration results. These cannot be estimated and are subject to
renegotiation upon the expiry of the existing exploration leases.
Capital Expenditure Commitments
The Group had no capital expenditure commitments as at 31 December 2022 (30
June 2022: $nil).
15. CONTINGENT ASSETS, CONTINGENT LIABILITIES AND GUARANTEES
Contingent Assets and Contingent Liabilities at Reporting Date
The Directors are of the opinion that there were no contingent assets or
contingent liabilities as at 31 December 2022 and as at 30 June 2022.
Guarantees
Synergia Energy Ltd has issued guarantees in relation to corporate credit
cards. The bank guarantees amount to $50,000 (30 June 2022: $50,000).
16. ISSUED CAPITAL - FULLY PAID
Half-Year Ended Year Ended
31 December 2022 30 June 2022
Number of Issued Number of Issued
Ordinary
Ordinary
Shares Capital
Shares Capital
$ $
Shares
On issue 1 July 8,242,959,310 192,181,384 5,685,971,571 185,355,925
Issue of share capital
Shares issued for cash (()(1)) 174,831,394 608,378 2,497,758,909 7,503,616
Shares issued for non-cash - - 4,389,645 19,489
Exercise of unlisted options - - 54,839,185 136,393
Capital raising costs (()(2)) - 27,381 - (834,039)
Balance at 31 December / 30 June 8,417,790,704 192,817,143 8,242,959,310 192,181,384
Additional information of the issue of ordinary shares:
(1) )Following shareholder approval received at the 13 July 2022 General
Meeting, 174,831,394 fully paid ordinary shares were issued at £0.002
($0.0035) per share. The shares were the final instalment of the placement
previously arranged and announced on 4 May 2022. 69,932,558 shares out of
174,831,394 shares were issued on 21 July 2022 and the remaining 104,898,836
shares were issued on 3 August 2022.
(2) )The overall credit "inflow" of capital raising costs during the
half-year period is a result of reversals of capital raising costs which were
over-accrued in previous financial periods, and which were more than other
capital raising costs incurred during the period (including those for options
granted to Novum during the period). Refer to Note 17 (footnote (2)) with
regards to the fair value of options granted to Novum.
The Company does not have authorised capital or par value in respect of its
issued shares. The holders of ordinary shares are entitled to receive
dividends as declared from time to time and are entitled to one vote per share
at meetings of the Company.
17. SHARE-BASED PAYMENTS
Half-Year Ended Half-Year
31 December 2022
Ended
$ 31 December 2021
$
Shares and Options - Equity Settled
Non-Executive Directors - remuneration shares - 19,489
Executive Directors - long-term incentive options (()(1)) 84,094 -
Total share-based payments expense and amount recognised in the Condensed 84,094 19,489
Consolidated Statement of Profit or Loss and Other Comprehensive Income
Share-Based Payments Recognised Directly in Equity
Options granted to brokers and financiers during the period (()(2)) 25,152 53,133
Total share-based payments recognised directly in equity 25,152 53,133
Total Share-Based Payment Transactions 109,246 72,622
Additional information on share-based payment transactions during the period:
(1) ) Relates to 324,675,324 unlisted options which were issued to
Executive Directors (Messrs Salomon, Wessel and Judd) on 12 August 2022,
following the Company's General Meeting held on 13 July 2022. The options are
exercisable at £0.0022 ($0.0039) and expire on 12 August 2027, with one third
(1/3) vesting on 30 June 2022, one third (1/3) vesting on 30 June 2023 and one
third (1/3) vesting on 30 June 2024.
The total fair value of the unlisted options issued to Executive Directors
($504,564) was calculated at the grant date of 13 July 2022 using the
Black-Scholes Model. Expected volatility was estimated by considering
historical volatility of the Company's share price over the period
commensurate with the expected term. The following factors and assumptions
were used to determine the fair value of the 324,675,324 unlisted options
granted to Executive Directors on 13 July 2022:
Grant Date Vesting Date Expiry Date Fair Value Per Option Exercise Price Price of Shares on Grant Date Expected Volatility Risk Free Interest Rate Dividend Yield
13 July 2022 As indicated above 12 August 2027 £0.0009 £0.0022 £0.0016 75.15% 1.35% -
($0.0016)
($0.0039)
($0.0028)
One third (1/3) of the value of these options ($168,188) was expensed at 30
June 2022, with a further $84,094 expensed during the half-year ended
31 December 2022.
(2) ) On 13 July 2022, at the Company's General Meeting held on that
date, 30,000,000 unlisted options were approved by shareholders and granted to
Novum, pursuant to the placing agreement the Company had with Novum for their
role as Lead Manager pursuant to the capital raising advisory agreement
relating to the May placement.
The options are exercisable at £0.002 ($0.0039) and expires on 30 April 2024.
The fair value of the unlisted options was calculated at the grant date of 13
July 2022 using the Black-Scholes Model. Expected volatility was estimated by
considering historical volatility of the Company's share price over the period
commensurate with the expected term.
The following factors and assumptions were used to determine the fair value of
the 30,000,000 unlisted options granted to Novum during the period:
Grant Date Vesting Date Expiry Date Fair Value Per Option Exercise Price Price of Shares on Grant Date Expected Volatility Risk Free Interest Rate Dividend Yield
13 July 2022 13 July 2022 30 April 2024 £0.0005 £0.0020 £0.0016 75.15% 1.35% -
($0.0008)
($0.0039)
($0.0028)
The options were issued on 13 September 2022 and have not been exercised at
the half-year report date.
No other options were issued during the half-year ended 31 December 2022. The
balance of unlisted options at 31 December 2022 was 379,885,408 (30 June 2022:
736,505,236 options), as shown in the schedule below:
Issue Date Expiry Date Exercise Price Balance at 1 July 2022 Issued During the Period Options Expired Balance at 31 Dec 2022
19 Jan 2022 31 May 2024 £0.0024 25,210,084 - - 25,210,084
17 Mar 2022 31 Dec 2022 £0.0028 711,295,152 - (711,295,152) -
12 Aug 2022 12 Aug 2027 £0.0022 - 324,675,324 - 324,675,324
13 Sep 2022 30 Apr 2024 £0.0020 - 30,000,000 - 30,000,000
736,505,236 354,675,324 (711,295,152) 379,885,408
18. RELATED PARTY TRANSACTIONS
Arrangements with related parties continue to be in place, including the
324,675,324 unlisted options issued on 12 August 2022 to the Executive
Directors as long-term incentives. For details of these arrangements, refer to
the consolidated annual financial report of the Group as at and for the year
ended 30 June 2022.
No further related party arrangements were made during the period to 31
December 2022.
19. CHANGE IN THE COMPOSITION OF THE GROUP
Since the last annual reporting date, there have been no significant changes
in the composition of the Group.
20. SUBSEQUENT EVENTS
On 13 February 2023, the Company made a repayment to JX of US$196,754.
Following the repayment and further interest accrued, at report date, the
balance of the loan from JX is approximately US$253,549.
On 22 February 2023, the Company announced that it entered into a convertible
loan agreement with certain sophisticated and/or professional existing and new
shareholders to secure a new convertible loan facility of £650,000. The
convertible loan proceeds were received by the Company between 23 February
2023 and 9 March 2023 and will be used for working capital purposes. Under
the terms of the agreement, and as a consequence of the receipt date of the
funds, the option date and maturity date were extended to 9 December 2023 and
9 March 2024 respectively.
A summary of the key terms of the convertible loan facility is disclosed in
Note 12.
Other than the above disclosures, there has not arisen in the interval between
the end of the financial half-year period and the date of this report an item,
transaction or event of a material and unusual nature likely, in the opinion
of the Directors of the Company, to affect significantly the operations of the
Group, the results of those operations, or the state of affairs of the Group,
in future financial periods.
DIRECTORS' DECLARATION
In the opinion of the Directors of Synergia Energy Ltd (the Company):
1. the condensed consolidated financial statements and notes set out on
pages 9 to 28, are in accordance with the Corporations Act 2001 including:
(a) giving a true and fair view of the Group's financial position as at 31
December 2022 and of its performance for the half-year ended on that date; and
(b) complying with Australian Accounting Standard AASB 134 Interim Financial
Reporting and the Corporations Regulations 2001; and
2. there are reasonable grounds to believe that the Group and the Company
will be able to pay its debts as and when they become due and payable.
Signed in accordance with a resolution of the Directors.
Mr Jonathan Salomon Mr Roland Wessel
Executive Chairman Chief Executive Officer
West Perth
Western Australia
15 March 2023
INDEPENDENT AUDITOR'S REVIEW REPORT
TO THE MEMBERS OF SYNERGIA ENERGY LTD
Report on the Half-Year Financial Report
Conclusion
We have reviewed the half-year financial report of Synergia Energy Ltd (the
company) and controlled entities (consolidated entity) which comprises the
condensed consolidated statement of financial position as at 31 December 2022,
the condensed consolidated statement of profit or loss and other comprehensive
income, the condensed consolidated statement of changes in equity and the
condensed consolidated statement of cash flows for the half-year ended on that
date, notes comprising a summary of significant accounting policies and other
explanatory information and the directors' declaration of the consolidated
entity comprising the company and the entities it controlled at 31 December
2022, or during the half year.
Based on our review, which is not an audit, we have not become aware of any
matter that makes us believe that the accompanying half-year financial report
of Synergia Energy Ltd is not in accordance with the Corporations Act 2001
including:
(a) giving a true and fair view of the consolidated entity's financial
position as at 31 December 2022 and of its performance for the half-year ended
on that date; and
(b) complying with Accounting Standard AASB 134 Interim Financial Reporting
and the Corporations Regulations 2001.
Basis for Conclusion
We conducted our review in accordance with ASRE 2410 Review of a Financial
Report Performed by the Independent Auditor of the Entity. Our
responsibilities are further described in the Auditor's Responsibilities for
the Review of the Financial Report section of our report.
Material Uncertainty related to Going Concern
Without qualifying our conclusion, we draw attention to Note 2(c) in the
financial report in which indicates that the consolidated entity incurred a
loss of ($3,674,813) (31 December 2021: ($2,235,196)) during the half year
ended 31 December 2022, it incurred negative operating cashflow of
($4,071,309) (31 December 2021: ($1,734,653)). These conditions, along with
other matters as set forth in Note 2(c) indicate the existence of a material
uncertainty which may cast significant doubt about the consolidated entity's
ability to continue as a going concern and therefore, the consolidated entity
may be unable to realise its assets and discharge its liabilities in the
normal course of business, and at the amounts stated in the financial report.
Independence
We are independent of the company in accordance with the auditor independence
requirements of the Corporations Act 2001 and the ethical requirements of the
Accounting Professional and Ethical Standards Board's APES 110 Code of Ethics
for Professional Accountants (including Independence Standards) (the Code)
that are relevant to our audit of the annual financial report in Australia. We
have also fulfilled our other ethical responsibilities in accordance with the
Code.
Directors' Responsibility for the Half-Year Financial Report
The directors of the company are responsible for the preparation of the
half-year financial report that gives a true and fair view in accordance with
the Australian Accounting Standards and the Corporations Act 2001 and for such
internal controls as the directors determine is necessary to enable the
preparation of the half-year financial report that gives a true and fair view
and is free from material misstatement, whether due to fraud or error.
Auditor's Responsibilities for the Review of the Financial Report
Our responsibility is to express a conclusion on the half-year financial
report based on our review. ASRE 2410 requires us to conclude whether we have
become aware of any matter that makes us believe that the half-year financial
report is not in accordance with the Corporations Act 2001 including: giving a
true and fair view of the consolidated entity's financial position as at 31
December 2022 and its performance for the half year ended on that date; and
complying with Accounting Standard AASB 134 Interim Financial Reporting and
the Corporation Regulations 2001.
A review of a half-year financial report consists of making enquiries,
primarily of persons responsible for financial and accounting matters, and
applying analytical and other review procedures. A review is substantially
less in scope than an audit conducted in accordance with Australian Auditing
Standards and consequently does not enable us to obtain assurance that we
would become aware of all significant matters that might be identified in an
audit. Accordingly, we do not express an audit opinion.
PKF PERTH
SHANE CROSS
PARTNER
15 March 2023
West Perth,
Western Australia
DEFINITIONS
Associated Gas Natural gas found in contact with or dissolved in crude oil in the reservoir.
It can be further categorised as Gas-Cap Gas or Solution Gas.
Barrels/Bbls Barrels of oil or condensate - standard unit of measurement for all oil and
condensate production. One barrel is equal to 159 litres or 35 imperial
gallons.
BBO Billion standard barrels of oil or condensate.
BCF Billion cubic feet of gas at standard temperature and pressure conditions.
BCFE Billion cubic feet equivalent of gas at standard temperature and pressure
conditions.
BOE Barrels of Oil Equivalent. Converting gas volumes to the oil equivalent is
customarily done on the basis of the nominal heating content or calorific
value of the fuel. Common industry gas conversion factors usually range
between 1 barrel of oil equivalent ("BOE") = 5,600 standard cubic feet ("scf")
of gas to 1 BOE = 6,000 scf. (Many operators use 1 BOE = 5,620 scf derived
from the metric unit equivalent 1 m³ crude oil = 1,000 m³ natural gas).
BOEPD Barrels of oil equivalent per day.
BOPD Barrels of oil per day.
CCGT Combined cycle gas turbines.
CCS "Carbon Capture and Sequestration" or "Carbon Capture and Storage"
CO(2) Carbon dioxide.
Contingent Resources Those quantities of petroleum estimated, as of a given date, to be potentially
recoverable from known accumulations by application of development projects,
but which are not currently considered to be commercially recoverable due to
one or more contingencies.
Contingent Resources may include, for example, projects for which there are
currently no viable markets, or where commercial recovery is dependent on
technology under development, or where evaluation of the accumulation is
insufficient to clearly assess commerciality. Contingent Resources are
further categorised in accordance with the level of certainty associated with
the estimates and may be sub-classified based on project maturity and/or
characterised by their economic status.
Discovered in place volume Is that quantity of petroleum that is estimated, as of a given date, to be
contained in known accumulations prior to production.
FISO Floating injection, storage and offloading.
FEED Front End Engineering Design.
GOI The Government of India.
GOR Gas to oil ratio in an oil field, calculated using measured natural gas and
crude oil volumes at stated conditions. The gas/oil ratio may be the solution
gas/oil, symbol Rs; produced gas/oil ratio, symbol Rp; or another suitably
defined ratio of gas production to oil production. Volumes measured in
scf/bbl.
LNG Liquefied natural gas.
MMBO Million standard barrels of oil or condensate.
mD Millidarcy - unit of permeability.
MD Measured Depth.
MMbbls Million barrels of oil or condensate.
MMscfd Million standard cubic feet (of gas) per day.
MSCFD Thousand standard cubic feet (of gas) per day.
NSTA North Sea Transition Authority.
PI Participating Interest.
Prospective Resources Those quantities of petroleum which are estimated, as of a given date, to be
potentially recoverable from undiscovered accumulations.
PSC Production Sharing Contract.
Reserves Reserves are those quantities of petroleum anticipated to be commercially
recoverable by application of development projects to known accumulations from
a given date forward under defined conditions.
Proved Reserves are those quantities of petroleum, which by analysis of
geoscience and engineering data, can be estimated with reasonable certainty to
be commercially recoverable, from a given date forward, from known reservoirs
and under defined economic conditions, operating methods and government
regulations.
Probable Reserves are those additional Reserves which analysis of geoscience
and engineering data indicate are less likely to be recovered than Proved
Reserves but more certain to be recovered than Possible Reserves.
Possible Reserves are those additional reserves which analysis of geoscience
and engineering data indicate are less likely to be recoverable than Probable
Reserves. Reserves are designated as 1P (Proved), 2P (Proved plus Probable)
and 3P (Proved plus Probable plus Possible).
Probabilistic methods
· P90 refers to the quantity for which it is estimated there is at
least a 90% probability the actual quantity recovered will equal or exceed.
· P50 refers to the quantity for which it is estimated there is at
least a 50% probability the actual quantity recovered will equal or exceed.
· P10 refers to the quantity for which it is estimated there is at
least a 10% probability the actual quantity recovered will equal or exceed.
SCF/BBL Standard cubic feet (of gas) per barrel (of oil).
SCFD Standard cubic feet (of gas) per day.
TCF Trillion cubic feet of gas at standard temperature and pressure conditions.
Tight Gas Reservoir The reservoir cannot be produced at economic flow rates or recover economic
volumes of natural gas unless the well is stimulated by a large hydraulic
fracture treatment, a horizontal wellbore, or by using multilateral wellbores.
UKCS The United Kingdom Continental Shelf
Undiscovered in place volume Is that quantity of petroleum estimated, as of a given date, to be contained
within accumulations yet to be discovered.
CORPORATE INFORMATION
Directors Stock Exchange Listings
Joe Salomon (B APP SC (Geology), GAICD) Synergia Energy Ltd's shares are listed under the code SYN on the Alternative
Investment Market ("AIM") of the London Stock Exchange ("LSE")
Executive Chairman
Roland Wessel
AIM Nominated Adviser
Chief Executive Officer and Executive Director
Strand Hanson Limited
Colin Judd
26 Mount Row
Chief Financial Officer and Executive Director
London W1K 3SQ
Mark Bolton (B Business)
United Kingdom
Non-Executive Director
Paul Haywood
AIM Broker
Independent Non-Executive Director
Novum Securities Limited
Peter Schwarz
(B Sc (Geology), M Sc (Petroleum Geology)) 2nd Floor
Independent Non-Executive Director Lansdowne House
57 Berkeley Square
Company Secretary London W1J 6ER
Jack Rosagro (B.Com, FGIA) United Kingdom
Registered and Principal Office Share Registry
Level 1, 11 Lucknow Place Computershare Investor Services PLC
West Perth The Pavilions
Western Australia 6005 Bridgwater Road
Australia Bristol BS13 8AE
Ph. +61 (0)8 9485 3200 United Kingdom
Fax +61 (0)8 9485 3290 Ph. +44 (0) 870 703 6149
Website: www.computershare.com (http://www.computershare.com)
Postal Address
PO Box 255
West Perth
Western Australia 6872
Australia
India Operations - Gujarat Project Office Auditors
2(nd) Floor, Shreeji Complex PKF Perth
Next to Rituraj Complex Level 5, 35 Havelock Street
Vasna Road, Village Akota
Vadodara - 390015 West Perth
Gujarat, India
Western Australia 6005
Australia
Website
www.synergiaenergy.com
Email
synergiaenergy@synergiaenergy.com (mailto:synergiaenergy@synergiaenergy.com)
Synergia Energy Ltd
ACN 078 652 632
ABN 50 078 652 632
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