TIDMGBP
RNS Number : 2538R
Global Petroleum Ltd
20 September 2017
20 September 2017
Global Petroleum Limited
("the Company" or "Global")
Final Results for the Year Ended 30 June 2017, Appendix 4G
The Directors of Global Petroleum Limited present their report
for the Group comprising of Global Petroleum Limited ("the Company"
or "Global" or "Parent") and the entities it controlled at the end
of, or during, the year ended 30 June 2017 ("Consolidated Entity"
or "Group").
The Company confirms that a full copy of its latest Annual
Report and Accounts, as well as the relevant Appendix 4G will be
available shortly on the Company's website
(www.globalpetroleum.com.au).
Full copies of the Directors' Report and 2016-2017 Financial
Statements are available at:
http://www.asx.com.au/asx/statistics/announcements.do?by=asxCode&asxCode=GBP&timeframe=R&dateReleased=20%2F09%2F2017
Chairman and CEO's Review
In terms of the wider economic picture during the last financial
year, commodity prices have improved slightly with the Brent oil
price averaging $51 per barrel in the reporting year to 30 June
2017, compared to $45 in the preceding year to end June 2016.
Unsurprisingly, the outlook for operational and commercial activity
remains challenging, but recent equity raisings by energy companies
in the London capital market demonstrate that financing is
available for the right opportunities.
The Company's Petroleum Exploration Licence offshore Namibia is
currently in Phase 2, which has a duration of 24 months until
December 2017. In place of the previous well commitment in Phase 2,
the Company undertook to reprocess and re-interpret previously
acquired 2D seismic data and to shoot 800 kilometres of new 2D. The
evaluation of the reprocessed data proved to be very encouraging,
increasing confidence in a syn-rift oil play in the outboard or
deep water region offshore Namibia as well as the likely presence
of both reservoir and source within the Company's blocks. This
evaluation has significantly improved Global's view of the overall
prospectivity of its acreage enabling the upgrading of the three
leads previously identified to prospects, in particular the Gemsbok
prospect.
Accordingly, the Company announced during the reporting period
that it had entered into a contract with seismic contractor Seabird
Exploration of Norway to acquire 834 km of full fold 2D seismic
data over its blocks, primarily focused on Gemsbok. The seismic
survey was duly carried out, and successfully completed post the
end of the reporting period. Based on the preliminary technical
information obtained, the Company remains highly encouraged as
efforts now move to interpretation of the 2D seismic.
Regarding the Company's four exploration applications offshore
Italy, environmental decrees were published in late 2016 by the
Italian authorities in relation to two of the Company's four
applications (d 82 F.R-GP and d 83 F.R GP). Subsequently, a number
of appeals were lodged against the two environmental decrees by a
mixture of local and urban authorities, and by special interest
groups. The Company understands that similar appeals have been made
over the last two years or so against environmental decrees granted
to other companies in the Southern Adriatic, and that these appeals
were rejected by the Regional Administrative Tribunal of
Latium.
The slow progress towards final grant of the Italian licences is
disappointing, however, the Company has not lost sight of its very
positive view of the prospectivity of the application areas and we
intend to persevere through the appeals proces.
Financial
During the year ended 30 June 2017, the Group recorded a loss
after tax of US$1,856,463 (2016: loss US$2,336,513). Cash balances
at 30 June 2017 amounted to US$7,807,605 (2016: US$10,172,598). The
Group has no debt.
Strategy and Outlook
The further evaluation of the prospectivity of the Company's
Namibian Licence - in particular the delineation of the Gemsbok
structure - in our view constitutes real progress. In addition, the
Company has continued to evaluate opportunities which would balance
its existing portfolio, notably those more in the nature of
investment in contingent resources or exploration in proven
hydrocarbon provinces. Accordingly, over the past 12 months, we
have been engaged in detailed discussions with certain
counterparties, which ultimately proved unsuccessful. However, we
will continue to evaluate appropriate opportunities, both asset
purchases and potential corporate combinations. We retain a
significant cash position compared to many of our peers, and remain
confident of making a key investment in due course.
We look forward to meeting Shareholders at the Company's Annual
General Meeting later in 2017.
John van der Welle Peter Hill
Chairman Chief Executive Officer
Operating and Financial Review
Namibian Project
The Namibian Project consists of a participating interest in
Petroleum Exploration Licence Number 29 ("Licence") covering
Offshore Blocks 1910B and 2010A in the Republic of Namibia. The
Licence, issued on 3 December 2010, originally covered 11,730
square kilometres and is located offshore Namibia in water depths
ranging from 1,300 metres to 3,000 metres.
The Company's wholly owned subsidiary, Jupiter Petroleum
(Namibia) Limited, is operator of the Licence with an 85% interest
in the two blocks. Partners NAMCOR (the Namibian state oil company)
and Bronze Investments Pty Ltd hold 10% and 5% respectively, both
as carried interests.
In December 2015, the Company entered into the First Renewal
Exploration Period (Phase 2) of the Licence, making a mandatory
relinquishment of 50% of the Licence Area. Phase 2 is for a
duration of 24 months with a reduced Minimum Work Programme. In
place of the previous well commitment in Phase 2, the Company
undertook to reprocess and re-interpret previously acquired 2D
seismic data, and to shoot 800 kilometres of new 2D data. To this
end, in 2016 the Company's technical team evaluated reprocessed 2D
seismic data from the 1990s which it had purchased, and also
reprocessed and evaluated speculative 2D seismic data shot over its
Blocks in 2011/12 by seismic contractor TGS. The evaluation of this
data proved to be very encouraging. Notably the work increased
confidence in a syn-rift oil play in the outboard or deep water
region offshore Namibia as well as the likely presence of both
reservoir and source within the Company's blocks, thus
significantly increasing Global's confidence in the overall
prospectivity of its blocks.
Accordingly, the three leads previously identified were upgraded
to prospect status as a consequence of the perceived reduction in
risk. Of these, Global believes that the Gemsbok structure is
currently the most significant exploration opportunity. Gemsbok is
mapped as a 200 sq km structurally controlled dip closure adjacent
to a deep syn-rift graben. The feature has closure at several
levels from the Lower Cretaceous to the Tertiary and the proximity
to the mapped graben means that it is also well placed on the
hydrocarbon migration pathway. Clearly this is a very exciting
development for Global - the direct analogue to Gemsbok is the
multi-billion barrel, sub salt, syn-rift play of Southern Angola.
Despite recent encouragement from exploration further south
offshore Namibia, the syn-rift remains relatively under-explored
and we believe Gemsbok is ideally located for a syn-rift test.
During the reporting period, the Company announced that it had
entered into a contract with seismic contractor Seabird Exploration
of Norway in order to acquire 834 km of full fold 2D seismic data
over its blocks, primarily focused on Gemsbok. The seismic survey
was duly carried out, and successfully completed post the end of
the reporting period. The initial preliminary technical information
from the vessel is of a very high quality and appear to confirm the
scale and structural extent of Gemsbok. The Company remains highly
encouraged as efforts now move to seismic data processing and
interpretation
Permit Applications in the Southern Adriatic, Offshore Italy
In August 2013, the Company submitted an application and
proposed work programme and budget to the Italian Ministry of
Economic Development for four exploration areas offshore Italy. The
Permit Applications were then published on 30 September 2013 in the
Official Bulletin allowing other competitive bids to be made over
the subsequent three months. In accordance with Italian offshore
regulations, Global subsequently submitted the relevant
documentation to the respective authorities in relation to
environmental requirements, and in connection with the satisfaction
of certain technical and financial requirements. The Company was
subsequently informed that it had duly satisfied the
technical/financial requirements. The Company has previously
announced that environmental decrees have been published by the
Italian authorities in relation to two of the Company's four
applications (d 82 F.R-GP and d 83 F.R -GP), and that a number of
appeals have been launched against the two environmental decrees by
a mixture of local and urban authorities, and by special interest
groups. The Company understands that similar appeals were recently
made against environmental decrees granted to other companies in
the Southern Adriatic, and that these appeals were rejected by the
Regional Administrative Tribunal of Latium
The southern Adriatic is currently undergoing a significant new
phase of oil and gas exploration. Seismic acquisition companies
have begun large, multi-client 2D acquisition programmes across the
entire basin, from Italy to Croatia.
In Montenegro, offshore concessions were awarded in 2016 to
Marathon, OMV and Eni, with these companies also having been
awarded offshore licences in Croatia. Shell have operated with some
success in Albania exploring and developing fields with similar
geological characteristics to those encountered offshore in the
Southern Adriatic.
The activity in terms of licensing and the size of companies
involved underscores the interest in the Adriatic area and is
viewed very positively by the Company as an endorsement of its
Mediterranean focus
Business Development
Global remains in a strong financial position from which to fund
work activity on its Namibian acreage, its Italian application
interests (subject to award), and to implement a change of focus
through acquisition.
The Company has continued to evaluate opportunities which would
balance its existing portfolio, notably those more in the nature of
investment in contingent resources or exploration in proven
hydrocarbon provinces. Accordingly it has, over the past 12 months,
been engaged in detailed discussions with certain counterparties,
which ultimately proved unsuccessful. However the Company intends
to continue to evaluate appropriate opportunities, both asset
purchases and potential corporate combinations. The Company retains
a significant cash position compared to many of its peers, and
remains confident of making a key investment in due course.
Presentation currency
The financial information in this annual report is presented in
United States dollars (US$)
Results of Operations
2017 2016
US$ US$
--------------------------------- ------------ ------------
Loss from continuing operations
before tax (1,856,463) (2,336,513)
--------------------------------- ------------ ------------
Income tax benefit (expense) - -
--------------------------------- ------------ ------------
Net profit (loss) (1,856,463) (2,336,513)
================================= ============ ============
The results of the Group include revenue from interest income of
US$48,814 (2016: US$43,942).
Review of financial condition
As at 30 June 2017, the Group had cash of US$7,807,605 (2016:
US$10,172,598) and had no debt.
Global Petroleum Limited
Peter Hill, Managing Director +44 (0) 20 7495
& CEO 6802
+61 (0) 7 3310
Damien Cronin, Company Secretary 8732
Cantor Fitzgerald Europe (Nominated
Adviser & Joint Broker)
+44 (0) 20 7894
Sarah Wharry / Craig Francis 7000
GMP FirstEnergy Capital LLP (Joint
Broker)
+44 (0) 20 7448
Hugh Sanderson 0200
Tavistock (Financial PR & IR)
+44 (0) 20 7920
Simon Hudson / Niall Walsh 3150
This information is provided by RNS
The company news service from the London Stock Exchange
END
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