TIDMAOGL
RNS Number : 8798N
Attis Oil and Gas Ltd
27 September 2019
Attis Oil & Gas Ltd / Index: AIM / Epic: AOGL/ ISIN:
VGG6622A1057 / Sector: Oil and Gas
27 September 2019
Attis Oil & Gas ("Attis" or "the Company")
Interim Results
Attis (AIM: AOGL) is pleased to announce its unaudited interim
financial results for the six months ended 30 June 2019.
Chairman and Chief Executive's Statement
Following a committed period of assessment of the corporate
structure of the business, its operational practices, and its
existing oil and gas assets during the fourth quarter of 2018, we
emerged with a strategy centred on allocating our limited financial
resources in a disciplined manner to the projects that had the best
potential to maximize the Company's returns. We acted swiftly on
the results of this review and began the process of working over
our seven Austin Field wells covering 1,368 acres in Texas and
resolving our dispute with our then operator of Zink Ranch in
Oklahoma in order to regain control of our assets. The workover
programme and stimulus initiatives proved successful and post
period end we were pleased to report an average daily production
rate of 110 barrels of oil equivalent per day ("boepd").
Based on our observation of the strong operational capabilities
of our contract operator, Attis Oil and Gas Ltd ('Attis') during
that same period, their onshore assets and field services division,
we approached their management and agreed to a consolidation. This
transaction (the 'Acquisition'), enhanced our operating
capabilities, added a new revenue stream in the form of an
established oil services division and brought on Thom Board as
Chief Operating Officer and his US operational team as well as
Russell Lamming as a Non- Executive Director.
Acquiring Attis was undoubtedly a pivotal moment for the
Company, not only in the period under review, but in its lifetime.
The Acquisition increased the Company's production base and its
total acreage to 8,841 acres. In the period, and post period end,
we have been leveraging off Attis' growing reputation as a value
add third party oilfield service provider and have subsequently won
several key contracts bringing the total number of wells covered by
the services division to c.1,800 in a relatively short period of
time. This has provided a valuable, additional source of revenue
for the Company that is insulated from fluctuations in the oil and
natural gas price, as well as providing exposure to a wide range of
assets that may be of potential interest to the Company as
acquisition targets.
Regarding our existing interests, in February, the Company
increased its Net Revenue Interest at Austin Field by transferring
Smart Bit's interest to an overriding royalty. We took control of
operatorship in Zink Ranch in April and began the formal process
with the Osage Nation at the same time. We expect formal transfer
to occur by the end of 2019. These moves have proven to be
commercially sound considering the recent operational performance
of the assets. Our Borger office, near Amarillo, Texas has proven
to be extremely capable and efficient at optimising the performance
of our existing oil and gas assets, but the distances between our
fields creates challenges that can stretch our resources and we
continue to assess field and company optimisation strategies. The
Reserve Reports that we commissioned are nearing completion which
will allow us to effectively plan how best to attain future value,
be it to sell, farmout, or obtain reserve lending. Our growing
regional reputation in the Texas Panhandle as well as Thom and his
team's deep understanding of the local area and its geology
provides us with opportunities not readily available to other
players and we are appraising new acreage for production
development, engaging in joint venture possibilities, and
progressing the operatorship division.
We have maintained our interest in TSX listed Petroteq Energy,
Inc. that consists of 1,035,233 shares with an associated 1,035,233
3-year warrants at USD $0.90. Petroteq is a fully integrated oil
and gas company focused on expanding production capacity at its
Asphalt Ridge heavy oil extraction and processing facility in Utah.
Petroteq has continued to make excellent progress in the period
including increasing its acreage by 8,480 gross acres through the
acquisition of 50% of the operating rights and interests relating
to oil sands previously held under U.S. federal oil and gas leases
in Utah. The completion of the first maintenance turnaround at
Petroteq's oil sands processing facility resulted in the
recommencement of oil production.
We have been delighted to welcome Russell Lamming and Thom Board
to the Board of Directors and I believe that the Company has
already benefited from their public company and capital markets
experience and extensive technical expertise. The Board's mandate
is straightforward - to ensure effective operations and provide
strategic direction to create value for the Company's shareholders.
This remains a responsibility that we take seriously, and we are
encouraged by the notably improved revenue performance and reduced
debt position recorded during the six months, particularly when set
against the backdrop of relatively weak oil and gas prices seen in
the period, and slower ramp up in oil production than initially
anticipated. The direction of travel is clear.
We are executing on the strategy we laid out last year and are
demonstrating that our new team and focused execution provide the
platform that will generate significant growth. In less than a
year, we refocused the Company, settled legacy portfolio issues,
increased production from our existing assets and opened up
additional revenue streams, in particular through the establishment
of the services division which today has a well count of c.1,800.
The oilfield services division moved quickly to positive cashflow
with September turnover at c. $20,000. We expect to double monthly
turnover utilising the same resources in H1 2020 as the testing
regime ramps up across the well portfolio. We will continue to grow
the business through further well compliance contracts and
expanding testing & diagnostic services.
It hasn't been without its challenges, but we are confident that
we have turned the corner. We are optimistic that in the upcoming
months we will look to continue to optimise operations across our
core portfolio, leverage the strong regional reputation and
capabilities of the Attis team, evaluate consolidation and growth
opportunities and increase the long term value of the company.
Shareholder value shall remain at the forefront of our mind, and I
wish to take the opportunity to thank investors for their support
as well as our staff and advisors for their continued hard
work.
Paolo G. Amoruso Charlie Wood
Executive Chairman Chief Executive Officer
27 September 2019 27 September 2019
Special note concerning the Market Abuse Regulation
This announcement contains inside information for the purposes
of Article 7 of the Market Abuse Regulation (EU) No 596/2014
("MAR").
**S**
A copy of this announcement and the Interim Results will be
available on the Company's web site. For further information visit
www.attisog.com or contact the following:
Charlie Wood Attis Oil & Gas Ltd +44 20 7236 1177
Thom Board Attis Oil & Gas Ltd +44 20 7236 1177
Roland Cornish Beaumont Cornish Ltd +44 20 7628 3396
James Biddle Beaumont Cornish Ltd +44 20 7628 3396
Frank Buhagiar St Brides Partners Limited +44 20 7236 1177
Gaby Jenner St Brides Partners Limited +44 20 7236 1177
Colin Rowbury Novum Securities Limited +44 20 7399 9400
Notes:
Attis Oil & Gas Ltd is an AIM listed (London Stock Exchange)
oil and gas energy Company pursuing a strategy focused on drilling,
re-stimulating, and operating wells within mature producing basins
in the United States that generate immediate cash flow from
projects that are shallow, low risk, with low levels of capex and
infrastructure already in place. Attis also provides field and well
operating services to third parties through its operating entity
based out of Borger, Texas.
ATTIS OIL & GAS LTD CONDENSED CONSOLIDATED INTERIM FINANCIAL
STATEMENTS
Attis Oil & Gas Ltd Consolidated Statement of Comprehensive
Income
for the Interim six months period ended 30 June 2019
Six Months to Six Months to Year Ended
30 June 30 June 31-Dec
Note 2019 2018 2018
(Unaudited) (Unaudited) (Audited)
US$ 000's US$ 000's US$ 000's
Continuing operations
Revenue 134 20 104
Cost of Sales (171) (7) (403)
Gross profit/ (Loss) (37) 13 (299)
Administrative expenses
Impairment of financial assets at fair
value through profit or loss - - (1,126)
Loss on sale of financial assets at fair value
through profit or loss - - (129)
Other administrative expenses (1,073) (850) (1,659)
Total administrative expenses (1,073) (850) (2,914)
Operating (loss) (1,110) (837) (3,213)
------------------- ------------------- -------------------
Other income 44 - 19
Finance income - - -
Finance costs (6) (8) (17)
------------------- ------------------- -------------------
Profit/ (loss) before income tax (1,072) - (3,211)
Income tax expense - - -
Profit/ (loss) for the period from continuing
operations (1,072) (845) (3,211)
------------------- ------------------- -------------------
Other comprehensive income:
Items that may be reclassified subsequently to
profit or loss:
Currency translation differences - - (12)
Total comprehensive income/ (loss) (1,072) (845) (3,223)
------------------- ------------------- -------------------
Owners of the parent (1,072) (845) (3,223)
Non-controlling interest - - -
Profit/ (loss) for the period from continuing
operations (1,072) (845) (3,223)
------------------- ------------------- -------------------
There are no discontinued activities
Earnings per share from continuing and
discontinued operations US cents per share US cents per share US cents per share
attributable to the owners of the parent during
the period
- Basic & diluted (US cents per share) 3 (0.04) (0.07) (0.24)
Attis Oil & Gas Ltd Consolidated Statement of Financial
Position
As at 30 June 2019
Six Months Six Months
to to Year to
30 June 30 June 31 Dec
Note 2019 2018 2018
(Unaudited) (Unaudited) Audited
US$ 000's US$ 000's US$ 000's
ASSETS
Non-current assets
Property, plant and equipment 3,715 1,199 1,522
Total non-current assets 3,715 1,199 1,522
Current assets
Inventories - - -
Trade and other receivables 474 1,156 43
Financial assets at fair value
through profit or loss 419 1,950 419
Available for sale financial investments - - -
Cash and cash equivalents 465 59 143
Total current assets 1,358 3,165 605
------------ ------------ ----------
TOTAL ASSETS 5,073 4,364 2,127
------------ ------------ ----------
LIABILITIES
Non-Current Liabilities
Provisions (365) (663) (563)
Total non-current liabilities (365) (663) (563)
Current liabilities
Trade and other payables (857) (732) (767)
Joint venture liabilities (79) - -
Provisions (284) (475) (284)
Total current liabilities (1,220) (1,207) (1,051)
TOTAL LIABILITIES (1,585) (1,870) (1,614)
------------ ------------ ----------
NET ASSETS 3,488 2,494 513
============ ============ ==========
EQUITY ATTRIBUTABLE TO OWNERS
OF THE PARENT
Share Capital 4 - - -
Share premium 44,694 40,631 40,789
Foreign exchange reserve (77) (59) (125)
Reverse acquisition reserve (8,202) (8,202) (8,202)
Retained earnings (32,927) (29,876) (31,949)
Total Equity attributable to the
equity owners of the parent 3,488 2,494 513
Non-controlling interest - - -
TOTAL EQUITY 3,488 2,494 513
============ ============ ==========
Attis Oil & Gas Ltd Consolidated Statement of Changes in
Equity
for the six months interim period ended 30 June 2019
Attributable to owners of the parent
-------------------------------------------------------------------------
Share Share Foreign Reverse Retained Sub Total Non-Controlling Total
capital premium exchange Acquisition earnings Interests equity
reserve Reserve
US$ 000's US$ 000's US$ 000's US$ 000's US$ 000's US$ 000's US$ 000's US$ 000's
Balance as at
1 January
2018
(audited) - 38,946 (113) (8,202) (29,036) 1,595 - 1,595
--------------- ----------- ---------- ---------- ------------ ---------- ---------------- ----------
Loss for the
period - - 54 - (845) (791) - (791)
Items that may
be
reclassified
subsequently
to profit or
loss -
Currency
translation
differences - - - - - - -
----------- ---------- ---------- ------------ ---------- ---------- ---------------- ----------
Total
comprehensive
income for
the period - - 54 - (708) (654) - (654)
----------- ---------- ---------- ------------ ---------- ---------- ---------------- ----------
Issue of
Shares - 1,426 - - - 1,426 - 1426
Exercise of
warrants - 259 - - - 259 - 259
Balance as at
30 June 2018
(unaudited) - 40,631 (59) (8,202) (29,881) 2,489 - 2,489
----------- ---------- ---------- ------------ ---------- ---------------- ----------
Balance as at
1 January
2019
(audited) - 40,789 (125) (8,202) (31,949) 513 - 513
--------------- ----------- ---------- ---------- ------------ ---------- ---------------- ----------
Loss for the
period - - 48 - (1,072) (1,024) - (1,024)
Items that may
be
reclassified
subsequently
to profit or
loss -
Currency
translation
differences - - - - - - -
Total
comprehensive
income for
the period - - 48 - (1,072) (1,024) - (1,024)
----------- ---------- ---------- ------------ ---------- ---------------- ----------
Issue of
Shares - 4,031 - - - 4,031 - 4,031
Share issue
costs - (32) - - - (32) - (32)
Cost of share issue - issue
of share warrants (94) - - 94 - - -
Balance as at
30 June 2019
(unaudited) - 44,694 (77) (8,202) (32,927) 3,488 - 3,488
----------- ---------- ---------- ------------ ---------- ---------------- ----------
Attis Oil & Gas Ltd Consolidated Cash Flow Statement
for the six month interim period ended 30 June 2019
Six Months Six Months
to to Year to
30 June 30 June 31 Dec
2019 2018 2018
(Unaudited) (Unaudited) Audited
US$ 000's US$ 000's US$ 000's
----------------------------------------- ------------ ------------ ----------
Cash flows from operating activities:
Profit/(Loss) for the period before
taxation (1,072) (844) (3,211)
Adjustments for:
Impairment - - 1,126
Finance cost 6 8 17
Finance income - - -
Loss on sale of disposal of financial
assets at fair value through profit
or loss - - 129
Share based payments 125 - 125
Foreign Exchange - - (36)
Change in working capital items:
(Increase)/decrease in inventories - - -
(Increase)/decrease in trade and
other receivables (432) 5 (7)
Increase/(decrease) in trade and
other payables 202 (98) (60)
Net cash outflow used in operating
activities (1,171) (929) (1,917)
------------ ------------ ----------
Cash flows used in investing activities
Purchase of Investments - - -
Purchases of property, plant and
equipment (414) (84) (302)
Proceeds from disposal of financial
assets at fair value through profit
or loss - - 260
Exploration and evaluation -tangible
assets - - -
Net cash used in investing activities (414) (84) (42)
------------ ------------ ----------
Cash flows from financing activities
Proceeds from issue of share capital 1,899 259 1,386
Share issue costs (32) - (70)
Net finance cost (6) (8) (17)
Net cash generated from financing
activities 1,861 251 1,299
------------ ------------ ----------
Net increase/(Decrease) in cash
and cash equivalents 276 (757) (660)
Cash and cash equivalents at beginning
of period 143 803 803
Foreign exchange differences on
translation 46 13 -
Cash and cash equivalents at end
of period 465 59 143
------------ ------------ ----------
Notes to Attis Oil & Gas Ltd Consolidated Financial
Statements (unaudited)
for the six months ended 30 June 2019
1. Basis of presentation
The condensed consolidated interim financial statements have
been prepared under the historical cost convention and on a going
concern basis and in accordance with International Financial
Reporting Standards and IFRIC interpretations adopted for use in
the European Union ("IFRS").
The condensed consolidated interim financial statements
contained in this document do not constitute statutory accounts,
for the current reporting period, or for earlier periods, but are
derived from those accounts where applicable. In the opinion of the
directors, the condensed consolidated interim financial statements
fairly present the financial position, result of operations and
cash flows for the period.
A copy of this Interim Financial Report is available on the
Company's website: www.attisog.com and was approved by the Board of
Directors on 26 September 2019.
Statement of compliance
The condensed consolidated interim financial statements have
been prepared in accordance with the requirements of the AIM Rules
for Companies. As permitted, the Company has chosen not to adopt
IAS 34 "Interim Financial Statements" in preparing these interim
condensed consolidated interim financial statements, which should
be read in conjunction with the audited annual financial statements
for the year ended 31 December 2018, which have been prepared in
accordance with IFRS as adopted by the European Union.
Accounting policies
The condensed consolidated interim financial statements for the
period ended 30 June 2019 has not been audited or reviewed in
accordance with the International Standard on Review Engagements
2410 issued by the Auditing Practices Board. The figures were
prepared using applicable accounting policies and practices
consistent with those adopted in the audited annual financial
statements for the year ended 31 December 2018. In addition,
consideration has been given to IFRS 15 and IFRS 9 which both are
effective since 1 January 2019.
2. Financial risk management and financial instruments
Risks and uncertainties
The Board continually assesses and monitors the key risks of the
business. The key risks that could affect Attis' medium term
performance and the factors that mitigate those risks have not
substantially changed from those set out in Attis' 2018 Annual
Report and Financial Statements, a copy of which is available from
Attis' website. The key financial risks are market risk (including
oil price and currency risk), credit risk and liquidity.
Going concern
Attis has a track record of using a variety of mechanisms to
fund its commitments, whether it is through new equity, farm-ins
and disposals, debt or operational cash flow. This flexibility
gives the Directors discretion around when expenditure is incurred,
but it is probable that further equity finance will be required at
some point during the next 12 months.
The Board is confident however, that capital will be available
to allow it to realise its strategic goals and that the Attis will
have the necessary resources available to finance its future
working capital and discretionary capital expenditures beyond the
period of 12 months of the date of this report. Accordingly these
interim financial statements have been prepared on a going concern
basis.
3. Significant changes
The financial position and performance of the Group was
particularly affected by the acquisition of Attis UK Oil & Gas
which completed during the six months to 30 June 2019.
For further discussion of the Group's performance and financial
position refer to the Chairman and Chief Executive's Statement.
The Group's results are not materially impacted by
seasonality.
4. Joint Ventures and Profit Sharing Agreements
The Group is party to a joint venture when there is a
contractual agreement that sets out the terms of the relationship
over the relevant activities of the Group and at least on other
party. Management has a legal degree of control over these joint
venture arrangements through Joint Operating Agreements.
The Group classifies its interests in joint ventures as joint
operations: where the Group has both the rights to assets and
obligations for the liabilities of the joint venture. The Group
accounts for its interests in joint ventures by recognising its
share of assets, liabilities, revenues and expenses in accordance
with its contractually conferred rights and obligations.
The Group accounts for its own assets, liabilities and cash
flows measured in accordance with the terms of the Joint Operating
Agreement and the accounting treatment reflects the agreement's
commercial effect. The Group's revenue and cost of sales include
revenues and operating costs associated with the Group's
interest.
5. Earnings per share
The calculation of earnings per share is based on the earnings
attributable to equity holders divided by the weighted average
number of shares on issue during the period.
Six Months to Six Months to Year to
30 June 30 June 31 Dec
2019 2018 2018
(Unaudited) (Unaudited) (Audited)
US$ 000's US$ 000's US$ 000's
Net Profit (loss) after taxation (1,072) (708) (3,211)
Weighted average number of ordinary shares in issue 2,694,384,624 1,183,841,446 1,312,110,098
Earnings per share (cents) (0.04) (0.07) (0.24)
As referred to in Note 6 below, the Company has issued options.
However, based upon current share prices they presently have no
value and accordingly would not be exercised, hence basic and
diluted profit per share are the same. Historically the Company has
reported losses, in such a situation the inclusion of potential
ordinary shares would have resulted in a decrease in the loss per
share, and as such, their inclusion would be anti-dilutive.
Accordingly, a historic diluted loss per share has not been
calculated or included.
6. Share capital
The authorised share capital of the Company and the called up
and fully paid amounts at 30 June 2019 were as follows:
A) Authorised US$'000s US$'000s
Unlimited Ordinary shares of no par value - -
Six Months to 30 June As previously reported
2019
(Unaudited) (as at 31 December 2018)
Audited
B) Called up, allotted, issued and fully paid Number of shares Nominal Number of shares Nominal
value value
----------------------------------------------- ----------------- ---------- ----------------- ----------
As at 1 January 2019 1,462,946,943 - 1,166,335,931 -
Additions:
21 January 2019 810,890,438 - - -
8 February 2019 20,000,000 - - -
30 April 2019 1,480,454,927 - - -
23 March 2018 - - 4,166,666 -
10 May 2018 - - 8,333,333 -
1 June 2018 - - 44,100,000 -
19 June 2018 - - 11,141,178 -
25 June 2018 - - 160,449,535 -
26 July 2018 - - 18,437,951 -
23 August 2018 - - 25,274,725 -
17 October 2018 - - 24,707,626 -
As at 30 June 2019 3,774,292,316 - 1,462,946,943 -
----------------- ---------- ----------------- ----------
Shares issued on 21 January 2019 were issued at a price of 0.12
pence per share, for a cash consideration of GBP750,000 (before
share issue costs), as well as GBP223,069 shares issued to
creditors in settlement of third party creditor services and
directors fees. Shares issued on 8 February 2019 were issued at a
price of 0.12 pence per share, to creditors for the settlement of
GBP35,000 of third party creditor services. Shares issued on 30
April 2019 were issued at a price of 0.14 pence per share, for a
cash consideration of GBP700,000 (before share issue costs,
GBP39,560 shares issued to creditors in settlement of third party
creditor services and directors fees, and GBP1,333,076 shares to
acquire 100% of Attis Oil & Gas Limited and its subsidiaries,
affiliates and related entities (collectively referred to as
"Attis"), a proven US oil & gas operator which holds a 50%
interest in the Fort Worth Field, Texas and operates 98 wells
across 5,100 acres in the Fort Worth Basin.
7. Share based payments
The following is a summary of the share options and warrants
outstanding and exercisable as at 30 June 2019 and 31 December
2018.
Share based payment:- 6 Months to 30 6 Months to 30 Year to 31 December
June 2019 June 2018 2018
Summary of Share Options (Unaudited) (Unaudited) (Audited)
and Warrants
------------------------------
Number Weighted Number Weighted Number Weighted
of options Average of options Average of options Average
and warrants Exercise and warrants Exercise and warrants Exercise
price price price
------------------------------
(000's) Pence (000's) Pence (000's) Pence
------------------------------ -------------- ---------- -------------- ---------- -------------- ----------
Outstanding and exercisable,
beginning of year 225,422 0.01 87,092 0.05 87,092 0.05
Granted 79,625 0.13 116,634 0.11 199,884 0.01
Exercised - - (56,600) - (56,600) 0.03
Expired (4,061) (554) (554) 0.02
Cancelled - - - - (4,400) 0.06
Outstanding and exercisable,
end of year 300,986 0.09 146,572 0.09 225,422 0.01
-------------- -------------- --------------
The above is expressed in GBGBP and not US$ cents due to the
terms of the options and warrants
More details of the above events were released by RNS and are
also available from the Company's website www.attisog.com
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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