AI Terminal
NOSTRA TERRA OIL AND GAS COMPANY PLC
Pre-Annual General Meeting Information • Jun 8, 2022
7819_10-k_2022-06-08_869590c9-e9fb-4819-b13a-b8400fbf134e.html
Pre-Annual General Meeting Information
Open in ViewerOpens in native device viewer
National Storage Mechanism | Additional information 
RNS Number : 0730O
Nostra Terra Oil & Gas Company PLC
08 June 2022
8 June 2022
Nostra Terra Oil and Gas Company Plc
("Nostra Terra" or "the Company")
2021 Audited Annual Results
Notice of AGM
Nostra Terra (AIM: NTOG), the oil & gas exploration and production company with a portfolio of development and production assets in Texas, USA, is pleased to announce its final results for the year ended 31 December 2021 (the "Results"). A copy of the Results, along with a Notice of AGM, is being posted to Shareholders and is available on the Company's website, www.ntog.co.uk. The AGM will be held at at the offices of Druces LLP at Salisbury House, London Wall, London EC2M 5PS at 11.00 a.m. on 30 June 2022. Extracts from the Results are set out below.
This announcement contains information for the purposes of Article 7 of the EU Regulation 596/2014.
For further information, contact:
| Nostra Terra Oil and Gas Company plc Matt Lofgran, CEO |
Email: | +1 480 993 8933 |
| Beaumont Cornish Limited (Nominated Adviser) James Biddle/ Roland Cornish |
Tel: | +44 (0) 20 7628 3396 |
| Novum Securities Limited (Broker) Jon Belliss Lionsgate Communications (Public Relations) Jonathan Charles |
Tel: Tel: |
+44 (0) 207 399 9425 +44 (0) 7791 892509 |
Extracts of the Results are set out below:
Chairman's Report
I am pleased to present Nostra Terra Oil & Gas Company PLC's annual report for the year ending 31 December 2021.
2021 - a year of success and positive change
2020 closed amidst uncertainty as to how the Covid-19 pandemic would develop; only in the last few months has some degree of certainty returned. As at the time of writing it appears that, with the significant exception of China, most of the world has moved back to business as usual. This translated itself into a rising WTI oil price through the year as global economic activity took off again.
The reimposition of widespread lockdowns in China in early 2022, after the end of the reporting period, might have derailed this price recovery. However, the invasion of Ukraine by Russia on 24th February 2022 and the subsequent sanctions against, and voluntary boycotts of, Russian oil & gas have served to restrict supply such that, as I write, WTI is trading above $100 per barrel. It appears destined to remain there for the foreseeable future, as the war in Ukraine shows no sign of stopping. In the context of today's geopolitical situation, our Texan assets are advantageously located in a politically stable environment.
Nostra Terra took advantage of the low oil prices in 2020 to expand its portfolio of assets in Texas with the acquisition of Caballos Creek. In 2021, because of the strengthening oil price, we adjusted our strategy to one of realising the value from our existing assets while continuing to assess new opportunities. We are now seeing the fruits of these actions.
January 2021 saw the Cypress well (Fouke 1) at Pine Mills successfully completed and put into production with a low lifting cost per barrel. The same month Nostra Terra became cashflow positive at the corporate level.
During 2021, workovers on existing wells and other operational improvements led to an increase in average net daily production from 84 bbl/day in H1 2021 to 100 bbl/day in September 2021. By the end of May 2022 this had increased to circa 140 bbl/day (see below).
Net proven reserves attributable to Nostra Terra increased substantially during 2021, from 763,760 in 2020 to 973,180 bbl in late September and continued to rise to 1,073,960 bbl after year end.
These positive developments have led to a considerable increase in our revenue stream and to the size of our borrowing base: from $1.55 million in early 2021 to $2.35 million in later September 2021. After the end of the reporting year, (as announced on 28 March 2022), this currently stands at $3.35 million.
As well as working over existing wells in 2021, the Company prepared for the drilling of two new wells - Fouke 2 (32.5% Nostra Terra working interest) at Pine Mills, East Texas and the Grant East 1 well (100% Nostra Terra working interest) in the Permian Basin, West Texas.
After the year end of 31st December 2021, these wells both spudded and were drilled successfully. The Fouke #2 well flowed 145 bbl/day with no water cut; this is a 77% higher flow rate than that from the Fouke #1 well. The Grant East #1 reached TD in early May 2022 and as I write the results of fracture stimulation are awaited.
In early February 2022 Paul Welch was appointed as a non-executive director of the Company. Paul brings a wealth of experience to Nostra Terra and his positive contribution is already being felt.
The optimism your Board felt at the start of 2021 has been vindicated: Nostra Terra has taken advantage of the strengthening oil price and its acreage position to put it in a much stronger financial position. This will allow the Company to continue to expand its operations in a carefully planned manner.
I would like to thank shareholders for their continued support.
Dr Stephen Staley
Non-Executive Chairman
7 June 2022
Chief Executive Officer's Report
2021 marked the beginning of a turnaround for Nostra Terra. The Company fought through the tough times of 2020, but then started to return to growth in 2021. The 2021 focus for the Company was on increasing cashflow while minimising dilution and positioning the Company for larger growth ahead.
At the beginning of the year, we conducted a small, oversubscribed fundraise of £500,000 from institutional and professional investors, used for potential new opportunities. We brought on a new well at the beginning of the year as a non-operated, but significant working interest, asset while working on new opportunities to expand where we would operate and have a larger working interest ("WI"). This was accomplished while maintaining low overheads (16% lower than 2020).
Revenues for the year were $2,282,000 an increase of 123% from $1,025,000 in 2020, reflecting a combination of a 26% increase in production sales and an improving commodity price environment (average $61.42 per barrel sold in 2021 compared to $34.17 in 2020). Gross profit before non-cash items (depreciation, depletion, and amortization) was $574,000, significantly improved from a loss of $85,000 in 2020.
The Board continues to focus on its stated aim of increasing cashflow and reserves for the year ended 2022.
United States
All of Nostra Terra's operations in the US target conventional reservoirs (i.e., not shale), typically with lower lifting costs and long-life reserves than unconventional ones.
| Area | 2021 Production (Barrels sold) |
Percentage of Portfolio by Sales |
| East Texas | 29,132 | 78% |
| West Texas | 4,154 | 12% |
| South Texas | 3,840 | 10% |
East Texas (33- 100% WI)
Nostra Terra's core asset is Pine Mills (100% WI) providing secure production. Production remained stable for the year from the core producing wells, while the focus was on growing production significantly in the new farmout area.
During 2020 Nostra Terra farmed out an undrilled portion of the acreage to Cypress LLC, retaining a 32.5% WI, where a 25% WI was carried in the first well. In January 2021 drilling was finished on the new Fouke 1 well and it was put into production. The well was very successful, reaching payback in 5 months and continued producing throughout the year with no decline in production. Following this success, planning was undertaken for the next well, including increasing the acreage position in the farmout area. The Fouke 2 was drilled and put on production in the first half of 2022 (post-period). The well on test flowed at a rate of 145 bopd over a 24-hour period with a 0% watercut and was subsequently placed into production. This production rate exceeds that of the offset Fouke 1 well by 77%; Fouke 1 had been limited by field rules (allowable) to 82 bopd per well. As a result of the past performance of the Fouke 1 and the test rate of the Fouke 2, the operator plans to request a substantial increase in the field allowable rate so that both wells can be produced at much higher and more efficient rates. A decision is anticipated later in the year. During the interim period the operator plans to produce each well at circa 140 bopd, which is above the current allowable cap, to obtain sufficient technical information to support the increased field allowable. Further drilling is anticipated in this acreage.
West Texas (50 - 100% WI)
In 2021 production from the area accounted for 11% of the Company's sales (50-75% WI). Management targeted this prolific area as a place to grow production in 2022. In January 2022 (post-period) the Company announced growth plans, including this area. In April 2022 the company announced the new Grant East lease acquisition (100% WI) with up to 16 potential drilling locations.
South Texas (100% WI)
In 2020 the Company acquired the Caballos Creek asset, comprising two leases. There are no current plans for expansion in this area. Production during 2021 accounted for 10% of Company sales.
Senior Lending Facility
In September 2021 the Company renewed its Senior Lending Facility, resulting in a significant increase in Facility size and available Borrowing Base. The Facility has an initial nominal amount of U$10,000,000, double the previous US$5,000,000. The Borrowing Base has been increased to US$2,350,000 based on improved production and cashflow during the first half of 2021. The size of the Facility and Borrowing Base is reassessed at least twice yearly. The Board anticipates the Borrowing Base will increase substantially in the upcoming redetermination as the Company's production and reserves have since increased significantly. The current interest rate applied to use of the Facility is 4.40%
The Facility is not restricted to geographical region. Nostra Terra can deploy funds from the Facility for operational purposes and acquisitions in its current areas of operation in the USA, or in other areas of the world, should the opportunity arise.
Outlook
The global events this year have put a spotlight on the energy industry and the continued need for oil and gas in the world. The outlook for the industry is strong, as can be seen through robust commodity prices. In 2021 Company revenue more than doubled over the prior year and cashflow has also increased substantially. It was a year of strong growth and 2022 is on track to be an even better year. Having free cashflow puts the Company in a very strong position and we remain focused and disciplined on growing that further.
We're grateful for the support of our shareholders throughout the year. On behalf of the entire team at Nostra Terra we thank you and look forward to continued growth going forward.
Matt Lofgran
Chief Executive Officer
7 June 2022
Consolidated Income Statement
For the year ended 31 December 2021
| 2021 | 2020 | ||
| Notes | $'000 | $'000 | |
| Continuing operations | |||
| REVENUE | 2,282 | 1,025 | |
| COST OF SALES | |||
| Production costs | (1,708) | (1,110) | |
| Exploration | - | - | |
| Well impairment | - | - | |
| Depletion, depreciation, amortisation | (400) | (310) | |
| Total cost of sales | (2,108) | (1,420) | |
| GROSS PROFIT/(LOSS) | 174 | (395) | |
| Share based payment | (68) | (38) | |
| Administrative expenses | (908) | (896) | |
| Foreign exchange gain/(loss) | (130) | (33) | |
| OPERATING LOSS | 7 | (932) | (1,362) |
| Finance costs | 5 | (175) | (209) |
| Other income/(charges) | 6 | 21 | 269 |
| LOSS BEFORE TAX | (1,088) | (1,302) | |
| Income tax | 8 | - | - |
| LOSS FOR THE YEAR | (1,088) | (1,302) | |
| ATTRIBUTABLE TO: | |||
| Owners of the company | (1,088) | (1,302) | |
| EARNINGS PER SHARE | |||
| Continued operations | |||
| Basic & diluted (cents per share) | 10 | (0.16) | (0.35) |
The accompanying accounting policies and notes are an integral part of these financial statements
Consolidated Statement of Comprehensive Income
For the year ended 31 December 2021
| 2021 | 2020 | |
| $'000 | $'000 | |
| LOSS FOR THE PERIOD | (1,088) | (1,302) |
| OTHER COMPREHENSIVE INCOME: | ||
| Currency translation differences | - | - |
| Total comprehensive income for the year | (1,088) | (1,302) |
| TOTAL COMPREHENSIVE LOSS FOR THE YEAR ATTRIBUTABLE TO: | ||
| Owners of the company | (1,088) | (1,302) |
The accompanying accounting policies and notes are an integral part of these financial statements
Consolidated Statement of Financial Position
As at 31 December 2021
| 2021 | 2020 | ||
| Notes | $'000 | $'000 | |
| ASSETS | |||
| NON-CURRENT ASSETS | |||
| Intangible assets | 11 | 2,014 | 2,027 |
| Property, plant and equipment, Oil and gas assets | 12 | 918 | 780 |
| Total non-current assets | 2,932 | 2,807 | |
| CURRENT ASSETS | |||
| Trade and other receivables | 15 | 348 | 341 |
| Deposits and prepayments | 16 | 42 | |
| Other assets | - | - | |
| Cash and cash equivalents | 16 | 45 | 72 |
| Total current assets | 409 | 455 | |
| LIABILITIES | |||
| CURRENT LIABILITIES | |||
| Trade and other payables | 17 | 945 | 573 |
| Borrowings | 18 | 518 | 847 |
| Lease liabilities | 13 | - | 16 |
| Total current liabilities | 1,466 | 1,436 | |
| NET CURRENT LIABILITIES | (1,057) | (981) | |
| NON-CURRENT LIABILITIES | |||
| Decommissioning liabilities | 302 | 266 | |
| Borrowings | 18 | 2,459 | 2,159 |
| Lease liabilities | 13 | - | - |
| Total non-current liabilities | 2,761 | 2,425 | |
| NET LIABILITIES | (886) | (599) | |
| EQUITY | |||
| Share capital | 19 | 8,087 | 7,918 |
| Share premium | 21,976 | 21,508 | |
| Share based payment reserve | 306 | 142 | |
| Translation reserve | (676) | (676) | |
| Retained losses | (30,579) | (29,491) | |
| Total equity | (886) | (599) |
The financial statements were approved and authorised for issue by the Board of Directors on 7 June 2022 and were signed on its behalf by:
M B Lofgran
Director
Company registration number: 05338258
The accompanying accounting policies and notes are an integral part of these financial statements
Company Statement of Financial Position
As at 31 December 2021
| 2021 | 2020 | ||
| Notes | $'000 | $'000 | |
| ASSETS | |||
| NON-CURRENT ASSETS | |||
| Fixed asset investments | 14 | - | - |
| Intangible assets | 11 | 345 | 385 |
| Property, plant and equipment, Oil and gas assets | 12 | 112 | 76 |
| Total non-current assets | 457 | 461 | |
| CURRENT ASSETS | |||
| Trade and other receivables | 15 | 9 | 107 |
| Cash and cash equivalents | 16 | 16 | 14 |
| Total current assets | 25 | 121 | |
| LIABILITIES | |||
| CURRENT LIABILITIES | |||
| Trade and other payables | 17 | 1,262 | 410 |
| Borrowings | 18 | 518 | 847 |
| Total current liabilities | 1,780 | 1,257 | |
| NET CURRENT LIABILITIES | (1,755) | (1,136) | |
| NON-CURRENT LIABILITIES | |||
| Decommissioning liabilities | 13 | 4 | |
| Borrowings | 18 | 396 | 519 |
| Total non-current liabilities | 409 | 523 | |
| NET LIABILITIES | (1,707) | (1,198) | |
| EQUITY | |||
| Share capital | 19 | 8,087 | 7,918 |
| Share premium | 21,976 | 21,508 | |
| Share based payment reserve | 306 | 142 | |
| Translation reserve | (676) | (676) | |
| Retained losses | (31,400) | (30,090) | |
| Total equity | (1,707) | (1,198) |
The parent company's loss for the financial year was $1,307,447 (2020: $1,082,706).
The financial statements were approved and authorised for issue by the Board of Directors on 7 June 2022 and were signed on its behalf by:
M B Lofgran
Director
Company registration number: 05338258
The accompanying accounting policies and notes are an integral part of these financial statements
Consolidated Statement of Changes in Equity
For the year ended 31 December 2021
| Share capital |
Deferred shares | Share premium |
Share option reserve | Translation reserve | Retained losses | Total | |
| $'000 | $'000 | $'000 | $'000 | $'000 | $'000 | $'000 | |
| As at 1 January 2020 | 886 | 6,549 | 20,842 | 92 | (676) | (28,226) | (533) |
| Loss for the year | - | - | - | - | - | (1,302) | (1,302) |
| Total comprehensive loss for the year | - | - | - | - | - | (1,302) | (1,302) |
| Shares issued | 483 | - | 757 | - | - | - | 1,240 |
| Cost of shares issued | - | - | (91) | 26 | - | 23 | (42) |
| Exercise of warrants | - | - | - | (14) | - | 14 | - |
| Share based payments | - | - | - | 38 | - | - | 38 |
| As at 31 December 2020 | 1,369 | 6,549 | 21,508 | 142 | (676) | (29,491) | (599) |
| Loss for the year | - | - | - | - | - | (1,088) | (1,088) |
| Total comprehensive loss for the year | - | - | - | - | - | (1,088) | (1,088) |
| Shares issued | 169 | - | 529 | - | - | - | 698 |
| Cost of shares issued | - | - | (61) | - | - | - | (61) |
| Exercise of warrants | - | - | - | - | - | - | - |
| Share based payments | - | - | - | 164 | - | - | 164 |
| As at 31 December 2021 | 1,538 | 6,549 | 21,976 | 306 | (676) | (30,579) | (886) |
The accompanying accounting policies and notes are an integral part of these financial statements
Share capital is the amount subscribed for shares at nominal value.
Share premium represents the excess of the amount subscribed for share capital over the nominal value of those shares net of share issue expenses. Share issue expenses in the year comprise costs incurred in respect of the issue of new shares.
Share based payment reserve is a reserve used to recognize the cost and equity associated with the fair value of issues of share options and warrants.
Translation reserves arose due to the adoption of US dollars as the presentational currency at the start of the prior accounting period. Further information on the adjustment can be found in note 1.
Retained loss represents the cumulative losses of the company attributable to owners of the company.
Company Statement of Changes in Equity
For the year ended 31 December 2021
| Share capital |
Deferred shares | Share premium |
Share option reserve | Translation reserve | Retained losses | Total | |
| $'000 | $'000 | $'000 | $'000 | $'000 | $'000 | $'000 | |
| As at 1 January 2020 | 886 | 6,549 | 20,842 | 92 | (676) | (29,021) | (1,328) |
| Loss for the year | - | - | - | - | - | (1,083) | (1,083) |
| Total comprehensive loss for the year | - | - | - | - | - | (1,083) | (1,083) |
| Shares issued | 483 | - | 757 | - | - | - | 1,240 |
| Cost of shares issued | - | - | (91) | 26 | - | - | (65) |
| Exercise of warrants | - | - | - | (14) | - | 14 | - |
| Share based payments | - | - | - | 38 | - | - | 38 |
| As at 31 December 2020 | 1,369 | 6,549 | 21,508 | 142 | (676) | (30,090) | (1,198) |
| Loss for the year | - | - | - | - | - | (1,310) | (1,310) |
| Total comprehensive loss for the year | - | - | - | - | - | (1,310) | (1,310) |
| Shares issued | 169 | - | 529 | - | - | - | 698 |
| Cost of shares issued | - | - | (61) | - | - | - | (61) |
| Exercise of warrants | - | - | - | - | - | - | |
| Share based payments | - | - | - | 164 | - | - | 164 |
| As at 31 December 2021 | 1,538 | 6,549 | 21,976 | 306 | (676) | (31,400) | (1,707) |
The accompanying accounting policies and notes are an integral part of these financial statements
Share capital is the amount subscribed for shares at nominal value.
Share premium represents the excess of the amount subscribed for share capital over the nominal value of those shares net of share issue expenses. Share issue expenses in the year comprise costs incurred in respect of the issue of new shares.
Share based payment reserve is a reserve used to recognize the cost and equity associated with the fair value of issues of share options and warrants.
Translation reserves arose due to the adoption of US dollars as the presentational currency at the start of the prior accounting period. Further information on the adjustment can be found in note 1.
Retained loss represents the cumulative losses of the company attributable to owners of the company.
Consolidated and Company Statement of Cash Flows
For the year ended 31 December 2021
| GROUP | COMPANY | ||||
| 2021 | 2020 | 2021 | 2020 | ||
| $'000 | $'000 | $'000 | $'000 | ||
| LOSS FOR THE YEAR | (1,088) | (1,302) | (1,310) | (1,083) | |
| ADJUSTMENTS FOR: | |||||
| Depreciation | 208 | 164 | 13 | 7 | |
| Amortisation | 173 | 146 | 40 | 13 | |
| Depletion | 38 | - | - | - | |
| Foreign exchange | - | 30 | - | 22 | |
| Share based payments | 68 | 38 | 68 | 38 | |
| Other income | (21) | (49) | - | - | |
| Operating cash flows | (622) | (973) | (1,189) | (1,003) | |
| Decrease/(increase) in receivables | 66 | 11 | 98 | (101) | |
| (Increase)/decrease in other assets | - | 108 | - | - | |
| (Decrease)/increase in payables | 285 | (190) | 852 | (136) | |
| (increase)/decrease in deposits & prepayments | 26 | (24) | - | - | |
| Interest paid | 175 | 209 | 110 | 123 | |
| Net cash used in operating activities | (70) | (859) | (129) | (1,117) | |
| Cash flows from investing activities: | |||||
| Purchase of plant and equipment | (346) | (242) | (49) | (79) | |
| Purchase of intangibles | (160) | (400) | - | (398) | |
| Disposals | - | 70 | - | - | |
| Increase in decommissioning liabilities | 36 | 27 | 9 | 4 | |
| Net cash from investing activities | (470) | (545) | (40) | (473) | |
| Cash flows from financing activities | |||||
| Shares issued | 794 | 1,240 | 794 | 1,240 | |
| Costs of shares issued | (61) | (91) | (61) | (91) | |
| Net borrowing | (29) | 312 | (452) | 426 | |
| Finance costs | (175) | (209) | (110) | (123) | |
| Lease payments | (16) | (16) | - | - | |
| Net cash from financing activities | 513 | 1,236 | 171 | 1,452 | |
| Net (decrease)/increase in cash and cash equivalents | (27) | (168) | 2 | (138) | |
| Cash and cash equivalents at the beginning of the year | 72 | 240 | 14 | 152 | |
| Cash and cash equivalents at the end of the year | 45 | 72 | 16 | 14 |
The accompanying accounting policies and notes are an integral part of these financial statements.
3. Segmental analysis
In the opinion of the directors, the group has one class of business, being the exploitation of hydrocarbon resources.
The group's primary reporting format is determined by geographical segment according to the location of the hydrocarbon assets. The group's reportable segments under IFRS 8 in the year are as follows:
United Kingdom - being the location of the head office.
US Mid-Continent properties at year end included the following:
· East Texas: 100% working interest in the Pine Mills oilfield
· East Texas: 32.5% working interest in the Cypress farmout area of Pine Mills
· West Texas: 50-100% working interest leases located in the Permian Basin
· South Texas: 100% working interest in the Caballos Creek oilfield
The chief operating decision maker's internal report for the year ended 31 December 2021 is based on the location of the oil properties as disclosed in the below table:
| SEGMENTAL RESULTS | US mid-continent 2021 $'000 |
Head office 2021 $'000 |
Total 2021 $'000 |
| Revenue | 2,282 | - | 2,282 |
| Operating profit (loss) before depreciation, well impairment, share-based payment charges, restructuring costs and gain (loss) on sale of assets and foreign exchange: | 616 | (970) | (354) |
| Depreciation of tangibles | (209) | - | (209) |
| Amortisation of intangibles | (173) | - | (173) |
| Exploration | - | - | - |
| Well impairment | - | - | - |
| Share based payments | - | (68) | (68) |
| Realised exchange loss | (2) | (128) | (130) |
| Operating profit/ (loss) | 232 | (1,166) | (934) |
| Finance expense | (65) | (110) | (175 |
| Other income (expense) | - | 21 | 21 |
| Profit/ (loss) before taxation | 167 | (1,255) | (1,088) |
| SEGMENTAL ASSETS | |||
| Property, plant and equipment | 2,014 | - | 2,014 |
| Intangible assets | 918 | - | 918 |
| Cash and cash equivalents | 9 | 36 | 45 |
| Trade and other receivables | 339 | 9 | 348 |
| 3,280 | 45 | 3,325 | |
Notes to the Financial Statements (continued)
For the year ended 31 December 2021
3. Segmental analysis (continued)
The chief operating decision maker's internal report for the year ended 31 December 2020 is based on the location of the oil properties as disclosed in the below table:
| SEGMENTAL RESULTS | US mid-continent 2020 $'000 |
Head office 2020 $'000 |
Total 2020 $'000 |
| Revenue | 1,025 | - | 1,025 |
| Operating profit (loss) before depreciation, well impairment, share-based payment charges, restructuring costs and gain (loss) on sale of assets and foreign exchange: | 120 | (881) | (761) |
| Depreciation of tangibles | (157) | (7) | (164) |
| Amortisation of intangibles | (133) | (13) | (146) |
| Exploration | - | - | - |
| Well impairment | - | - | - |
| Share based payments | - | (38) | (38) |
| Realised exchange loss | (12) | (21) | (33) |
| Operating profit/ (loss) | (182) | (960) | (1,142) |
| Finance expense | (86) | (123) | (209) |
| Other income (expense) | 49 | - | 49 |
| Profit/ (loss) before taxation | (219) | (1,083) | (1,302) |
| SEGMENTAL ASSETS | |||
| Property, plant and equipment | 704 | 76 | 780 |
| Intangible assets | 1,642 | 385 | 2,027 |
| Cash and cash equivalents | 72 | 14 | 86 |
| Trade and other receivables | 234 | 107 | 341 |
| Other assets | 28 | - | 28 |
| 2,680 | 582 | 3,262 | |
Notes to the Financial Statements (continued)
For the year ended 31 December 2021
4. Employees and Directors
| 2021 | 2020 | |
| $'000 | $'000 | |
| Directors' fees | 110 | 122 |
| Directors' remuneration | 219 | 205 |
| Social security costs | 19 | 9 |
| 348 | 327 |
| 2021 | 2020 | |
| Number | Number | |
| The average monthly number of employees (including directors) | ||
| during the year was as follows: | ||
| Directors | 3 | 3 |
| Employees | 3 | 3 |
Directors' remuneration
Total remuneration paid to directors during the year was as listed above.
The director's emoluments and other benefits for the year ended 31 December 2021 is as follows:
| 2021 | 2020 | |
| $'000 | $'000 | |
| M B Lofgran | 219 | 205 |
5. Finance expense
| 2021 | 2020 | |
| $'000 | $'000 | |
| Finance expense | 175 | 209 |
Finance expense relates to interest charged on borrowings. Further details for which can be found in note 18.
6. Other income
| 2021 | 2020 | |
| $'000 | $'000 | |
| Other income | 21 | 49 |
| Gain on Hedging Activity | - | 220 |
| 21 | 269 |
Other income relates to the aggregate recognised and unrecognised gain on a commodity swap.
Notes to the Financial Statements (continued)
For the year ended 31 December 2021
7. Operating loss
| 2021 | 2020 | |
| $'000 | $'000 | |
| The operating loss the year ended 31 December is stated after | ||
| after charging/ (crediting) | ||
| Depreciation of property, plant and equipment | 209 | 164 |
| Amortisation of intangibles | 173 | 146 |
| Exploration | - | - |
| Well impairment | - | - |
| The analysis of administrative expenses in the consolidated income statement by nature of expense: | ||
| Directors' remuneration | 219 | 205 |
| Depreciation on ROU asset | 16 | 16 |
| Social security costs | 19 | 9 |
| Directors' fees | 110 | 122 |
| Travelling and entertainment | 35 | 39 |
| Accountancy fees | 44 | 46 |
| Legal and professional fees | 183 | 179 |
| Auditors' remuneration | 6 | 20 |
| Bad debt costs | - | 23 |
| Other expenses | 64 | 237 |
| 908 | 896 |
8. Income tax
The income tax charge for the year was as follows:
| 2021 | 2020 | |
| $'000 | $'000 | |
| Current tax | - | - |
| Corporation tax | - | - |
| Overseas corporation tax | - | - |
| TOTAL | - | - |
| Loss before tax | (1,088) | (1,302) |
| Loss on ordinary activities before taxation multiplied by the | ||
| standard rate of UK corporation tax of 19% (2020:19%) | (207) | (247) |
| Effects of: | ||
| Non-deductible expenses | - | - |
| Other tax adjustments | 207 | 247 |
| Foreign tax | - | - |
| CURRENT TAX CHARGE | - | - |
At 31 December 2021, the Company had an estimated excess management expenses to carry forward of $5,552,821 (2020: $5,371,591). The deferred tax asset at 19% (2020: 19%) on these tax losses of $1,020,603 (2020: $1,020,603) has not been recognised due to the uncertainty of recovery. The current US corporate tax rate is 21%.
Notes to the Financial Statements (continued)
For the year ended 31 December 2021
9. Loss of Parent Company
As permitted by Section 408 of the Companies Act 2006, the income statement of the parent company is not presented as part of these financial statements. The parent company's loss for the financial year was $1,307,447(2020: $1,082,706).
10. Earnings per share
The calculation of earnings per ordinary share is based on earnings after tax and the weighted average number of ordinary shares in issue during the year. For diluted earnings per share, the weighted average number of ordinary shares in issue is adjusted to assume conversion of all dilutive potential ordinary shares. The group had two classes of dilutive potential ordinary shares, being those share options granted to employees and suppliers where the exercise price is less than the average market price of the group's ordinary shares during the year, and warrants granted to directors and one former adviser.
Details of the adjusted earnings per share are set out below:
| 2021 | 2020 | |
| GROUP | ||
| Loss attributable to ordinary shareholders ($'000) | (1,088) | (1,302) |
| Weighted average number of shares | 692,287,657 | 376,299,206 |
| CONTINUED OPERATIONS: BASIC AND DILUTED EPS - LOSS (cents) |
(0.16) | (0.35) |
The diluted loss per share is the same as the basic loss per share as the loss for the year has an antidilutive effect.
| 2021 | 2020 | |
| $'000 | $'000 | |
| Gross profit/(loss) before depreciation, depletion, amortisation and impairment | 743 | (85) |
| EPS on gross profit before depreciation, depletion, amortisation and impairment (cents) | 0.11 | 0.30 |
| RECONCILIATION FROM GROSS LOSS TO GROSS PROFIT BEFORE DEPLETION, DEPRECIATION, AMORTISATION AND IMPAIRMENT | ||
| Gross profit/(loss) | 174 | (395) |
| ADD BACK: | ||
| Exploration | - | - |
| Well impairment | - | - |
| Depletion, depreciation and amortisation | 400 | 310 |
| Gross profit before depletion, depreciation, amortisation and impairment | 574 | (85) |
END.
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact [email protected] or visit www.rns.com.
RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our Privacy Policy.
END
FR BKOBBKBKBPAK