RNS Number:2164K
Black Rock Oil & Gas PLC
19 December 2007
For immediate release 19 December 2007
Black Rock Oil & Gas Plc
("Black Rock" or the "Company")
Audited Results for the year ended 30 June 2007
Black Rock (AIM: BLR) announces its audited results for the year ended 30 June
2007. The Report and Accounts for the year ended 30 June 2007 are being posted
to shareholders today.
CHAIRMAN'S STATEMENT
The year ended 30 June 2007 has been a period of significant change and
development for the Company. Our new management team led by Dr. John Cubitt, has
rationalised the Company's portfolio to bring more focus to the Company's
activities. We have had exploration success at the Acacia Este well in Colombia
balanced by inconclusive appraisal results at Monterey in the UK and the Arce
Field in Colombia.
Looking forward, I am optimistic that Black Rock Oil & Gas will make progress
and capitalise on the potential of its UK North Sea and Colombia portfolio.
The highlight of the year was the initiation of drilling in June 2007 on the
low-risk Acacia Este exploration prospect on the Las Quinchas Association
Contract area in Colombia. This prospect is thought to have significant
recoverable heavy oil reserves (although no formal resource or reserve has yet
been prepared under any of the accepted standards such as the SPE or CIM) and it
was therefore highly significant when the well discovered oil in several sand
horizons from the Tertiary Mugrosa Formation. Testing subsequently recovered
16degreesAPI oil to a maximum rate of 101 barrels per day with only 5 per cent.
bottom sediment and water at standard conditions and low pump rates. Following
re-completion, the well was put onto a production test, the results of which at
this point are very encouraging. Our joint venture partner in Colombia, Kappa
Resources Colombia Limited ("Kappa"), intends over the next year conduct a
programme of appraisal well drilling and new seismic acquisition over the Acacia
Este field to delineate the size and nature of this important discovery. The
Company has had a number of discussions with third parties who have expressed an
interest in participating in Black Rock's Colombian assets and which would
either substantially relieve the Company of its share of these exploration and
appraisal expenditures or provide finance by means of capital injections to
carry out these exploration and appraisal expenditures. There is no certainty at
this stage that such arrangements will be concluded. However, we believe that
Acacia Este is an attractive asset given the potential for significant
commercial oil reserves and there is therefore, a reasonable likelihood that
such an arrangement could be concluded on attractive terms for the Company and
which would reduce, if not eliminate, the need for further funding in 2008.
In the summer of 2006, Black Rock announced the drilling and testing of the
fourth well on the Arce Field in the Las Quinchas Association Contract area in
Colombia. Subsequently, following discussions with Ecopetrol (the National Oil
Company of Colombia), Kappa (the Arce Field operator) and Black Rock were
sufficiently encouraged with the field potential that they placed Arce into a
long-term production testing programme. This test programme involved initially
cold flowing Arce wells 2 to 4 at low production rates until May 2007 when the
first attempt at steam injection was undertaken. Subsequently, Kappa has
experienced difficulties in completing the steam injection cycle on these wells
due to equipment breakdown and well completion failures. Ecopetrol decided in
October 2007 that that it would not participate in the Arce development and
informed Kappa and Black Rock that they could proceed on a sole risk basis.
Finally in November 2007, when the steam generator was determined to require two
further months of repair, Kappa and Black Rock decided that operations on Arce
Field should be suspended so as to allow resources to be directed at the Acacia
Este discovery whilst options for the future appraisal and development of the
Arce Field could be reconsidered. We do not envisage that the Arce Field will be
abandoned and continue to view the Arce Field as a potential development.
Black Rock also participated in late 2006 in the Monterey appraisal well block
49/8c-4 in the Southern Gas Basin of the North Sea. As previously announced,
drilling of the well was completed successfully and Black Rock was pleased to
see that natural gas flowed from several intervals in the Carboniferous
Westphalian reservoir and a thin Permian Leman Sandstone section during the well
test period. The gas flow rates were though disappointing. While the observed
flow rates might have been impeded by relatively low reservoir quality, which is
sometimes characteristic of the Carboniferous in the region, the Company
believes that the flow rates were more likely to have been adversely affected by
reservoir damage caused when the well had to be shut to recover equipment that
had become stuck. Nevertheless there has been sufficient encouragement to move
onto the second four year phase of the licence and the Monterey field operator,
Wintershall Noordzee, is currently evaluating the potential application of
horizontal well technology and fracture stimulation for development of the
field. In addition, the Company is encouraged by recent analysis that has
concluded that the Monterey field could have positive economics.
There have been a number of changes to the Board over the last year. Dr John
Cubitt was appointed Managing Director in October 2006 following Ivan Burgess'
resignation and Peter Kitson was appointed Finance Director in the same month.
In July 2007, Chris Moore was appointed to the Board to provide strategic advice
on the management and development of our asset portfolio. His company, Moyes &
Co of
Dallas, Texas, USA provides global energy consulting. The Board would like to
thank those members of the Board who have left during the Financial Year for
their hard work, and we welcome those who have been appointed to build on the
progress made.
During the year, the Company successfully raised in aggregate �3,163,723 by the
issue of 474,879,130 shares. Since the year end and following consolidation of
our stock on a 50 for 1 basis in July 2007, the Company raised a further
�2,003,250 by the issue of 11,129,167 shares. These funds were used primarily as
working capital to fund our Colombian oil exploration and appraisal projects.
In the light of the Acacia Este discovery, Black Rock has commissioned Gaffney,
Cline and Associates to produce a Competent Person's Report on its Colombian and
Southern North Sea assets. Work has commenced and it is expected that the report
will be completed by the end of March 2008 with an effective date of 31 December
2007. This will incorporate reserves and resource estimates (as appropriate) for
the current portfolio of discoveries and prospects.
In the meantime, the aim of the Board remains, to acquire, explore, and appraise
high potential projects in the established core regions, and to continue to
strive for near term production and build Black Rock Oil & Gas Plc on a solid
financial base. The Directors are determined to identify and capitalise on new
drilling potential, and consolidate current worthwhile projects.
I would like to thank the management team for all their hard work over the last
year and I look forward to working with the team to capitalise on the Acacia
Este success in the coming year.
A B Baldry
For further information, please contact:
Black Rock Oil & Gas Plc Tel: 01189 001350
Dr John Cubitt, Managing Director www.blackrockoil.com
----------------------
Beaumont Cornish Limited (Nominated Adviser) Tel: 0207 628 3396
Michael Cornish
Hanson Westhouse Limited (Broker to the Company) Tel: 0207 601 6100
Tim Feather / Matthew Johnson
Aquila Financial Limited Tel: 0207 202 2600
Peter Reilly
MANAGING DIRECTOR'S REPORT
The 2006/7 financial year has been a year of significant change for Black Rock
Oil & Gas Plc which has appraisal and near production opportunities in the UK
Southern North Sea and Colombia.
Colombia
In Colombia, Black Rock has an involvement with two licences, the Las Quinchas
Association Contract and more recently the Alhucema E&P Contract. In the Las
Quinchas Contract, Black Rock has completed all its obligations under the
farm-in contract signed with Kappa in April 2005 in which it agreed to fund
certain exploration drilling activities in order to earn a right to obtain,
subject to Ecopetrol's approval, a 50% interest in the Block. Consequently, the
field operator, Kappa, is in the process of applying for the formal assignment
to Black Rock of 50% of its interest in the Las Quinchas Association Contract.
This assignment is subject to the approval of both Ecopetrol and the ANH, the
Colombian government agency responsible for overseeing Colombia's oil and gas
exploration and production sector.
Within the 124,496 acre Las Quinchas Association Contract, there has been an
exciting discovery on the Acacia Este exploration well. Drilling commenced on 30
June 2007 and continued to a total depth of 3,970 feet. Fair to good oil shows
were encountered whist drilling the target Lower Mugrosa Formation. Subsequently
the well was tested and production reached a maximum rate of 101 barrels per day
("BOPD") of 16degrees API oil with only 5% bottom sediment and water at standard
conditions on 24 August.
The Acacia Este-1 well was produced by artificial lift using mechanical pumps.
Initially, the pump was set up with a stroke length of 84 inches and a slow rate
of 1 stroke per minute ("spm") in order to reduce the risk of sand inflow from
the sandstone reservoir into the wellbore. Once completion fluids were removed
from the well and oil began to flow on 21 August, the stroke rate was increased
gradually up to 5 spm in order to determine the optimum recoverability before
sand inflow occurred or until this phase of the test ended on August 31. The
fluids were recovered to tanks and measurements of the oil were corrected
volumetrically to standard conditions.
Operations at Acacia Este-1 were temporarily suspended in late August 2007 after
the anticipated sand inflow occurred. Operations recommenced in late October
after a work-over rig became available and was mobilised to the well. After
cleaning out the well, the opportunity was taken to re-test the lowermost zone
which had not previously produced significant volumes. Swab tests resulted in
production rates of several barrels per day with no water. Although the rates
are low, the results are very important because this potentially extends the
hydrocarbon column significantly down dip and increases net pay up to possibly
195 feet.
A work-over was then undertaken to re-complete the well with a gravel pack
within the liner over the upper zone that had previously been tested. Initial
flow rates of an extended production test following the work-over peaked at 98
BOPD at 2 spm, with very little water which was very encouraging. Production at
higher pump rates has not been undertaken as there is presently insufficient
storage capacity in the field, a situation that is being resolved promptly by
the transfer of one of the larger tanks from the Arce Field site. A pressure
build up test will be carried out in the near future, after which the well will
be shut-in until early next year.
Acacia is on trend with the prolific Casabe and Velasquez/Palagua heavy oil
fields.
The initial appraisal well, Acacia Este-2, is expected to be spudded imminently
with initial drilling results following some two to three weeks later. Following
testing, Acacia Este-2 will then be put on extended production test along with
Acacia Este-1.
The current seismic data coverage is insufficient to optimise further appraisal
well locations. Accordingly, Kappa and Black Rock intend to mobilise a seismic
crew early in 2008 to acquire new seismic data over the Acacia Este field. The
third appraisal well, Acacia Este-3, will be located after this data has been
acquired and interpreted and is planned for mid-2008.
In contrast to the good news on Acacia, the Arce Field project has been
disappointing. The Arce 4 appraisal well commenced drilling in June 2006 and was
a success, with oil flowing at the rate of 30.5 barrels of 13degreesAPI gravity
oil per day at standard conditions. The well was drilled to a total depth of
3,073 feet and intersected a gross 300 foot oil section.
As stated in last year's annual report, steam injection and production is now a
proven technique used in Colombia to increase oil flow by lowering the oil
viscosity and is successfully being used for production in the adjacent fields.
A pilot steam injection project, utilizing the Arce 2, 3 and 4 wells, was
therefore initiated in October 2006 and operations were expected to last until
June 2007. However, Ecopetrol requested that the cold flow stage of the test be
extended. As the cold flow production in effect created some void space, steam
was to be sequentially injected into each well for a period of 1-2 weeks,
followed by a soak period of 1-2 weeks whilst the reservoir heated up. Each well
was then expected to be put into production for the remainder of a 3-month test
cycle. Each steam injection test should have involved a minimum of 2 cycles for
a total test lasting approximately 6 months.
Subsequently, as reported by our Chairman, Kappa experienced considerable
difficulties in completing a full steam injection cycle on any of these wells
due to equipment breakdown or well completion failures. Finally in November 2007
when the steam generator was determined to require two further months of repair,
Kappa and Black Rock decided that injection operations on Arce Field should be
suspended whilst options for the future appraisal and development of the field
are reconsidered. This potential discovery has not therefore yet been properly
appraised due to equipment failure and the Company is reviewing the best way to
progress testing.
In the meantime, in October 2007, Ecopetrol authorised Kappa and Black Rock to
proceed with the development of a 77 acre area including the 4 existing Arce
wells and the surrounding area at their sole risk. As is customary, Ecopetrol
retains the right to participate at a future date by reimbursing past costs,
including a penalty premium for those costs expended during sole risk
operations. Exploration operations outside of the sole risk area, including the
Acacia Este discovery, and untested extensions of the Arce accumulation, will
also continue to be funded by Kappa and Black Rock. Ecopetrol also confirmed
that the contract's exploration period is now over, and the exploitation period
has commenced.
50% of the remaining acreage in the Las Quinchas Association Contract is due for
relinquishment in July 2008.
The first well under the 164,750 acre Alhucema E&P Contract will now be drilled
in the first quarter of 2008, subject to receipt of suitable permitting and land
access approvals. To avoid confusion with the Juanes prospects, the Juanes south
west location and well have been renamed Arrinconada and the first well,
Arrinconada-1. Arrinconada-1 is targeting a heavy oil prospect in the Tertiary
Mugrosa Formation. This well fully completes our obligations in year 2 of the
Alhucema E&P Contract following the acquisition of 50kms of 2D seismic in late
2006 that represented our obligations for year 1. Black Rock's formal assignment
of 50% interest in the Alhucema contract from Kappa is subject to the approval
of the ANH.
North Sea
The Company has a 15% interest in Block 49/8c, in the Southern North Sea,
operated by Wintershall Noordzee, which contains the Monterey gas field.
Discovered in 1989, the Monterey gas field is located approximately 15
kilometres west of the Windermere gas platform and south of the Schooner and
Ketch gas fields. The water depth in this location is about 35 metres. During
the last financial year, funding for up to US$4.274 million (approximately �2.4
million) in respect of the Monterey 49/8c-4 was provided by Gemini Oil & Gas
Fund II, L.P. ("Gemini") without recourse in return for an entitlement for
Gemini to receive interest and principal repayments based on Black Rock's share
of future revenues from the Monterey Gas Field.
Testing of the Monterey appraisal well was completed in November 2006. The well
flowed natural gas (principally methane, ethane and propane) from several
perforated intervals in the Carboniferous Westphalian and Permian Leman
Sandstone reservoir section at approximately 850,000 cubic feet per day through
a 2 inch choke. Observed flow rates might have been impeded by relatively low
reservoir quality and reservoir damage within the well. In common with many
vertical appraisal wells in the Southern North
Sea, the gas flow rates were less than can be expected from a horizontal
development well. The drill stem testing results indicated reasonable reservoir
permeability and pressure in intervals of the tested reservoir, while other
intervals were tighter.
Cautious progress has been made towards development during the last six months.
Through extensive evaluation of the results of the 49/8c-4 well by the operator,
Wintershall, and modelling of the potential application of horizontal well
technology and fracture stimulation, potentially positive economics have now
been obtained for the Monterey field. Wintershall has also identified a possible
export route that would reduce non-well capital expenditure significantly. The
future work programme includes phase 2 of a detailed seismic project to evaluate
the distribution and quality of the Carboniferous reservoir units,
pre-development studies and economic screening of the Monterey field. A
mandatory 50% relinquishment of the 49/8c and 49/9d area has been completed and
the joint venture has moved into the second 4 year term of the licence. The
retained area ,49/8c only, contains the Monterey gas field and the Stinson and
newly recognized Winchester prospects.
In 2007, results of a sponsored research project conducted at Edinburgh and
Herriot Watt Universities has revealed additional gas potential in the Triassic
Bunter Sandstone sequence above the Stinson prospect.
Other interests
Black Rock has rationalised its portfolio of other interests and risk exposure
in the UK by assigning its small interests in a number of onshore UK Blocks
(PEDL) around the Isle of Wight to the Operator Northern Petroleum. The
assignments were effective 1 March 2007.
As identified in the 2006 Annual Report, longer term projects that do not meet
expectations will be terminated rather than consume funds and management time.
As such, Black Rock did not renew the three Irish options that expired in
October 2006 and the intention is to dispose of the two remaining licences in
Australia. The first is the R3 retention lease offshore Western Australia
operated by Tap Oil (15% interest owned by Black Rock) which contains the highly
marginal Cyrano Field, and the second is a small interest in licence EP-325,
Offshore Carnarvon Basin, Western Australia operated by Strike Oil.
This will ensure that management time and financial resources are focused on
core Colombian and North Sea projects.
Black Rock continues to regularly review the structure of and risks associated
with its portfolio of assets, and recognises that some modifications to the
Company's portfolio may be required in the future to increase our breadth of
opportunities and reduce our exposure to financial risk.
In conclusion, we now have a significant discovery in Acacia Este and have
established the presence of hydrocarbons in Arce and Monterey. We have also
commissioned Gaffney, Cline and Associates to produce a Competent Person's
Report on the Company's Colombian and Southern North Sea assets and we expect
that the report should be completed by the end of March 2008.
Additionally in the first half of calendar year 2008, we expect to see
exploration drilling activity at Arrinconada and appraisal drilling and seismic
activity at Acacia Este.
J M Cubitt
CONSOLIDATED PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 30 JUNE 2007
2007 2006
Notes � � � �
Group turnover 2 - -
Cost of sales - -
_________ _________
Gross profit - -
Administrative
expenses
Administrative
expenses before
impairment of
exploration
expenditure and (1,400,921) (907,557)
goodwill
Impairment of
exploration - (760,794)
expenditure
and goodwill --------- --------
(1,400,921) (1,668,351)
--------- ---------
Group operating loss (1,400,921) (1,668,351)
(comprising
total administrative
expenses)
Interest receivable 20,847 9,011
--------- ---------
Loss on ordinary (1,380,074) (1,659,340)
activities
before taxation
Taxation 4 - -
--------- ---------
Loss on ordinary
activities
after taxation (1,380,074) (1,659,340)
--------- ---------
Retained loss for (1,380,074) (1,659,340)
the year ========= =========
Loss per share
Basic and diluted 3 (0.16p) (0.40p)
========= =========
The Group's operation in the year continued unchanged; no operations were
disposed or acquired.
STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES
FOR THE YEAR ENDED 30 JUNE 2007
2007 2006
� �
Retained loss for the year (1,380,074) (1,659,340)
Exchange differences on retranslation of net
assets of foreign currency operations 17,589 30,015
__________ ________
Total gains and losses recognised for the year (1,362,485) (1,629,325)
========= ========
CONSOLIDATED BALANCE SHEET
AS AT 30 JUNE 2007
Notes 2007 2006
� � � �
Fixed assets
Intangible assets 5 5,688,173 1,576,740
Tangible assets - -
---------- ----------
5,688,173 1,576,740
Current assets
Debtors 51,115 62,340
Cash at bank and in hand 246,545 551,723
--------- ---------
297,660 614,063
Creditors: Amounts falling
due
Within one year (209,987) (181,093)
--------- ---------
Net current assets 87,673 432,970
---------- ----------
Total assets less current 5,775,846 2,009,710
liabilities
Creditors: amounts falling
due after more (2,128,486) -
than one year
Provision for liabilities - (7,347)
and charges ---------- ----------
Net assets 3,647,360 2,002,363
========== ==========
Capital and reserves
Called up share capital 6 5,257,756 2,883,564
Share premium account 7 7,217,202 6,598,271
Merger reserve 7 - 212,023
Other reserve 7 38,820 56,483
Profit and loss account 7 (8,866,418) (7,747,978)
---------- ----------
Shareholders' funds 3,647,360 2,002,363
========== ==========
CONSOLIDATED CASH FLOW STATEMENT
FOR THE YEAR ENDED 30 JUNE 2007
Notes 2007 2006
� � � �
Net cash outflow from (1,344,521) (692,275)
operating activities 8
Returns on investments
and
Servicing of finance
Investment income 20,847 9,011
--------- ---------
(1,323,674) (683,264)
Capital expenditure
Net funds used for (4,111,433) (1,661,570)
investing in exploration
Acquisition of tangible - (21,286)
fixed assets --------- ----------
Net cash outflow from (4,111,433) (1,682,856)
acquisitions --------- ---------
Net cash outflow before (5,435,107) (2,366,120)
Financing
Financing
Proceeds from issue of 3,163,723 2,217,311
share
Issue costs (170,600) (72,643)
Long term loan 2,128,486 -
--------- ----------
Cash inflow from 5,121,609 2,144,668
financing --------- ---------
Decrease in cash 9 (331,498) (221,452)
========= =========
NOTES TO THE FINANCIAL INFORMATION
FOR THE YEAR ENDED 30 JUNE 2007
1. Basis of preparation and going concern
The financial information has been prepared in accordance with the historical
cost convention and in accordance with applicable accounting standards and the
Statement of Recommended Practice "Accounting for Oil and Gas Exploration,
Development, Production and Decommissioning Activities".
The financial information contained in this report does not constitute full
statutory accounts within the meaning of Section 240 of the Companies Act 1985.
The figures are extracted from the audited full financial statements for the
year ended 30 June 2007 which will be filed with the Registrar of Companies in
due course.
The financial statements have been prepared on the going concern basis as, in
the opinion of the Directors, at the time of approving the financial statements,
there is a reasonable expectation that the group will continue in operational
existence for the foreseeable future. In forming this opinion, the Directors
have taken account of the following facts and assumptions:
At 30 June 2007 the Group had net cash of �238,000.
As set out in the post balance sheet events note to the accounts (note 10), the
Company, since the year end has raised a sum of �2,003,000, before issue costs.
Also since the year end, the Group has spent �392,000 in connection with
exploration and appraisal expenditure relating to its Colombian projects, in
which both the Company and Kappa Resources Colombia Limited ("Kappa") have
interests. Furthermore, with regard to these Joint Operation Agreements with
Kappa on these Colombian projects, the Company is committed to make cash
payments to Kappa of $1,614,000 (�788,000) in December 2007 for exploration and
appraisal expenditures. It has also projected further exploration and appraisal
expenditures for the 12 months ending December 2008 of �3,197,000 for these
projects. The Company is currently in negotiations with third parties to affect
an arrangement that would either relieve the Company of the need to provide
funds for Colombia in 2008, based on current projections or provide finance by
means of capital injections to carry out these exploration and appraisal
expenditures.
Although there is no guarantee, the Directors, based on their discussions with,
and the level of interest shown by, these parties, believe that the Company will
be able to conclude such an arrangement because of the potential for significant
commercial reserves.
The projections also include a sum of �290,000 arising from a proposed sale of
deferred tax losses to Kappa in connection with capital expenditure incurred by
way of exploration and appraisal prior to 31 December 2006 on the Colombian
projects. Based on the Company's discussion with Kappa and following receipt of
local professional advice, Kappa has agreed to enter into a formal agreement
with the Company with regard to the disposal of the Company's tax losses for a
total sum of US$593,756 (�290,000).
Furthermore, the projections include significant reduction in the Group's
operating costs, which the Directors believe will be achievable in the projected
period.
The Directors therefore consider that it remains appropriate to prepare the
financial statements on the going concern basis.
NOTES TO THE FINANCIAL INFORMATION
FOR THE YEAR ENDED 30 JUNE 2007
2. Turnover
At the end of the financial year, the Group had not commenced commercial
production from its exploration sites and therefore had no turnover in the
period.
3. Loss per share
The loss per ordinary share of 0.16p (2006: 0.40p) is based on the loss for the
financial year of �1,380,074 (2006: �1,659,340) and 856,477,223 ordinary shares
(2006: 417,621,226), being the average number of shares in issue for the year.
No diluted loss per ordinary share has been disclosed because the conversion of
share warrants would decrease the net loss per share.
4. Taxation
2007 2006
� �
Current Tax
UK corporation tax on profits for the year - -
- -
Factors affecting tax charge for period
------------------------------- --------- ---------
Loss on ordinary activities before tax (1,380,074) (1,659,340)
------------------------------- --------- ---------
Tax on loss on ordinary activities at the (414,022) (497,802)
standard rate of UK corporation tax of 30% (2006: 30%)
------------------------------- --------- ---------
Effects of:
------------------------------- --------- ---------
Expensed not deductible for tax purposes 30,609 76,108
------------------------------- --------- ---------
Capital allowances in excess of depreciation (452,004) 7,631
------------------------------- --------- ---------
Tax losses 835,417 408,271
------------------------------- --------- ---------
Other tax adjustments - 5,792
------------------------------- --------- ---------
Total current tax charge - -
------------------------------- ========= =========
NOTES TO THE FINANCIAL INFORMATION
FOR THE YEAR ENDED 30 JUNE 2007
5. Intangible assets - Group
The movements during the year were as follows:
Exploration
and appraisal
expenditure Goodwill Total
� � �
Cost
At 1 July 2006 2,125,344 503,397 2,628,741
Additions 4,111,433 - 4,111,433
--------- -------- ---------
At 30 June 2007 6,236,777 503,397 6,740,174
========= ======== =========
Amortisation and impairment
At 1 July 2006 (548,604) (503,397) (1,052,001)
Impairment for the year - - -
--------- -------- ---------
At 30 June 2007 (548,604) (503,397) (1,052,001)
========= ======== =========
Net book value
At 30 June 2007 5,688,173 - 5,688,173
========= ======== =========
At 30 June 2006 1,576,740 - 1,576,740
========= ======== =========
The book value of the exploration and appraisal expenditure can be analysed in
the following geographical areas:
2007 2006
� �
Australia - -
Europe 2,698,023 89,202
South America 2,990,150 1,487,538
5,688,173 1,576,740
NOTES TO THE FINANCIAL INFORMATION
FOR THE YEAR ENDED 30 JUNE 2007
6. Share capital
2007 2006
� �
======== ========
Authorised 8,000,000 8,000,000
1,600,000 ordinary shares of 0.5p each
======== ========
Allotted, called up and fully paid 2,883,564 1,795,767
As at 1 July
Shares issued 2,374,192 1,087,797
-------- --------
As at 30 June 5,257,756 2,883,564
======== ========
The movements in the share capital and the warrants are summarised below:
Number of shares Number of warrants
Opening balance at 1 July 2006 576,712,770 42,378,922
Shares issued for cash 474,838,424 -
Share warrants conversion 40,700 (40,700)
Share warrants expired - (32,338,222)
---------- ---------
At 30 June 2007 1,051,591,894 10,000,000
========== =========
During the year, a total of 40,700 ordinary shares of 0.5p were issued at 2p
pursuant to the exercise of share warrants.
During the year the following new shares were issued for cash:
1. A total of 112,838,415 new shares were issued at 1.1p each on 7 July 2006
2. A total of 16,363,645 new shares were issued at 1p each on 4 August 2006
3. A total of 317,000,000 new shares were issued at 0.5p each on 18 January 2007
4. A total of 28,636,364 new shares were issued at 0.55p each on 29 January 2007
The details of the reorganisation of shares and further issue of shares after
the year end are set out in the post balance sheet events note 10.
NOTES TO THE FINANCIAL INFORMATION
FOR THE YEAR ENDED 30 JUNE 2007
7. Statement of movements on reserves
Movements in the share premium, merger reserve, other reserve and profit and
loss account during the year were as follows:
Share Merger Other Profit
premium reserve reserve and loss
� � � �
At 1 July 2006 6,598,271 212,023 56,483 (7,747,978)
Issue of shares net of issue
costs 618,931 - - -
Share based payment - - 14,359 -
Retained losses - - - (1,380,074)
Transfer from merger reserve - (212,023) - 212,023
Transfer on expiry of warrants - - (32,022) 32,022
Exchange differences - - - 17,589
At 30 June 2007 7,217,202 - 38,820 (8,866,418)
8. Reconciliation of operating loss to net cash outflow from
operating activities
2007 2006
� �
Group operating loss before interest (1,400,921) (1,688,351)
Impairment of exploration expenditure and
goodwill - 760,794
Decrease/(increase) in debtors 11,225 (47,308)
Increase in creditors 13,227 141,447
Effect of foreign exchange rates 17,589 30,015
Depreciation - 27,298
FRS20 share warrants charge 14,359 - 56,483
National Insurance charge on share warrants - 7,347
----------- ----------
Net cash outflow from operating activities (1,344,521) (692,275)
=========== ==========
9. Analysis of changes in net funds
2006 Cash flows 2007
� � �
Cash at bank and in hand net of bank 551,723 (313,498) 238,225
overdraft ============ ============ ============
NOTES TO THE FINANCIAL INFORMATION
FOR THE YEAR ENDED 30 JUNE 2007
10. Post balance sheet events
i) On 3 July 2007, the Company announced that the special resolution to approve
the consolidation, subdivision and reorganisation of the Company's share capital
was approved by shareholders at an extraordinary general meeting of the Company
held that day. Every 50 ordinary shares of 0.5p each in the share capital of the
company were, inter alia, consolidated into 1 new ordinary share of 1p each and
1 deferred share of 24p each. The new ordinary shares maintain the same rights
as those of the old ordinary shares. The deferred shares so created will have no
voting or dividend rights and, on a return of capital, the right only to receive
the amount paid up thereon after the holders of new ordinary shares have
received the aggregate amount paid up thereon, plus �1million per new ordinary
share. Consequently, the deferred shares will, effectively, be valueless.
ii) The company issued 11,129,167 new shares at 18p and raised a total of
�2,003,250 on 25 September 2007
11. Other Information
Copies of the audited annual report and accounts are available to download from
the Group's website www.blackrockoil.com.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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