(AIM: UJO)
Unaudited Results for the Six Months Ended
Operational Highlights
- Field Development Plan progressing to proceed with commercial production from the Wressle discovery expected to commence in late Q4 2016
- Acquisition of a 7.5% interest in PEDL143 containing the drill-ready Holmwood Prospect on trend with the Horse Hill-1 discovery
- Acquisition of an 8.33% interest in PEDL182 containing the Broughton North Prospect
Financial Highlights
- Cash position in excess of
£2 million as at5 September 2016 - Company remains debt free
- Company is fully funded for current planned drill programme and Wressle development
We are not deviating from our strategy and we are continuing to see an escalation of the rewards of that focus.
I am pleased to offer a positive Half Yearly Report to our shareholders and I look forward to reporting on the progress of our asset base during the remainder of 2016 and beyond."
For further information please contact the following:
David Bramhill
Shore Capital +44 (0) 20 7408 4090
Nominated Adviser
Edward Mansfield
Anita Ghanekar
Corporate Broking
Jerry Keen
SP Angel +44 (0) 20 3470 0470
Joint Broker
Richard Hail
Public Relations
Dominic Barretto
Aidan Stanley
CHAIRMAN'S STATEMENT
INTRODUCTION AND PROJECT REVIEW
I am pleased to present this Half Yearly Report for the six months ended
The past six months have proven to be highly satisfactory operationally with the acquisition of three new licence interests, namely PEDL143 (7.5%) from
On the financial aspect, costs are well under control and at the time of writing the Company holds cash in excess of
Since incorporation, Union Jack's strategy has been to focus on low-cost UK onshore projects, initially in exploration and appraisal drilling, and more recently production through the oil and gas discovery at Wressle-1 where the operator, Egdon, is progressing a Field Development Programme with a view to commencing commercial production in Q4 2016, coupled with the acquisition of an interest in the producing Keddington oilfield (PEDL005(R)). It remains the Board's goal for Union Jack to become a cash generative profitable entity in due course.
This time last year in respect of the Wressle-1 discovery within PEDL180, I commented on the on-going testing. One year on Wressle is expected, within months, to become a producer from the Ashover Grit reservoir at a controlled rate of 500 barrels of oil gross per day. Union Jack's income from this development is expected to have a material impact on the Company's cash flow generation and to contribute to financing the development of other projects within the Company's portfolio.
In addition, a Competent Persons Report ("CPR") in respect of Wressle is nearing completion and publication. The CPR will set out 2P oil and gas reserves held by the Company together with significant contingent resources and the confirmation of the viability of the project.
The Wressle-1 discovery has been mapped as extending into PEDL182. As a result, under the terms of an agreement entered into with Egdon in
In respect of logistics, it was deemed commercially prudent by the Board that Union Jack obtain an equal interest in the remainder of PEDL182 not covered by the Wressle discovery. Union Jack acquired an 8.33% economic interest from Egdon in
In
Holmwood is a conventional oil prospect first identified by BP in 1988 and is estimated by the operator, Europa, to hold gross mean unrisked prospective resources of 5.6 million barrels with a geological chance of success ("COS") of 33% and located just 12 kilometres from, and on trend with, the Horse Hill-1 discovery. A two year extension to PEDL143 was granted by the
In
Other assets held by Union Jack include interests in the producing Keddington oilfield PEDL005(R) (10%), Biscathorpe PEDL253 (12%), North Kelsey PEDL241 (20%), Burton on the Wolds PEDL201 (10%) and PEDL339 (10%) which contains an extension of the Louth Prospect.
Union Jack owns an interest in Keddington, which provides a modest income from our share of production. Within the licence area a number of high quality prospects are present, including the Louth Prospect, and the North Somercotes Prospect.
The Louth Prospect is estimated by the operator to contain Stock Tank Oil Initially in Place ("STOIIP") of 5.5 million barrels and gross mean Prospective Resources of 1.4 million barrels with an attractive COS of 37%.
Biscathorpe is a drill-ready prospect with planning consent, expected to be drilled during H1 2017, adding considerable risk adjusted value. The Biscathorpe structure was initially drilled by BP in 1987 with the Biscathorpe-1 well, which encountered a thin oil-bearing sandstone. The sand unit is expected to thicken away from the crest of the structure and the operatorÕs Best Estimate is a gross Prospective Resource of 14 million barrels of oil with a COS of 40%.
North Kelsey is a multi-target drill-ready prospect located within the proven hydrocarbon fairway of the Humberside Platform and is approximately 10 kilometres to the south of the Wressle-1 discovery.
The prospect is defined on 3D seismic data and has the potential for four stacked sandstone reservoirs. The gross mean combined Prospective Resources for these multiple objectives, as calculated by Egdon, are estimated to be 6.7 million barrels of oil.
Post the period end, in
Data from the Burton on the Wolds-1 well suggest significant Bowland-Hodder unconventional shale potential may exist on PEDL201 where thermally rich, oil prone shales are expected to be present.
During 2014, industry consultants
A detailed review of Union Jack's asset base can be found in the Review of Operations section within the Half Yearly Report and also within a Corporate Presentation, both of which can be viewed on the Company's website www.unionjackoil.com.
CORPORATE AND FINANCIAL
At the time of writing cash balances stand at in excess of
The Board intend to continue with the same low salary commitment going forward.
We apply strict financial and technical disciplines to our activities and we pride ourselves on our low general and administrative costs presented in the Income Statement within this report.
A further reduction in the Supplementary Tax rate from 20% to 10% in the
Our strategy of focusing on late-stage drill-ready projects helps to manage the portfolio from a technical perspective and also a financial scenario where costs are manageable and development of any discovery can be achieved within a reasonable time frame.
We believe the full cycle costs associated with UK onshore production, development and exploration remain highly attractive even at current oil prices, of which, in the Board's opinion, the nadir has been tested.
I take this opportunity, as always, to thank the rest of my Board, Joe O'Farrell, Graham Bull and Ray Godson, for their continuing solid advice, technical support and expert guidance in respect of Company matters, and acknowledge the natural cohesion between the Board and our advisers who all interact well, resulting in a sound functional team.
SUMMARY
I am pleased to state that, as we enter a new corporate and financial period, the growth of Union Jack continues without financial concerns.
We work with sound operators and partners who have already demonstrated their prowess in making discoveries and taking them through from discovery to development.
Union Jack's strategy will continue as stated, and I look forward to reporting on the progress of our projects during 2016 and beyond, in particular Wressle-1 where development is imminent and the cash flow to Union Jack is expected be a major catalyst to achieving our goals.
David Bramhill
Executive Chairman
UNAUDITED INCOME STATEMENT
for the six months ended
|
Notes |
Six months ended |
Six months ended £ |
Year £ |
|
|
8,152 |
- |
- |
|
|
(262,042) |
(259,512) |
(605,742) |
|
|
(253,890) |
(259,512) |
(605,742) |
|
|
|
|
|
Other Income |
|
- |
- |
12,713 |
Finance income |
|
3,193 |
3,474 |
6,569 |
|
|
(250,697) |
(256,038) |
(586,460) |
Taxation |
3 |
- |
- |
(841) |
|
|
(250,697) |
(256,038) |
(587,301) |
Attributable to: |
|
|
|
|
Equity shareholders of the Company |
|
(250,697) |
(256,038) |
(587,301) |
|
|
|
|
|
Basic and diluted loss per share (pence) |
2 |
(0.01) |
(0.01) |
(0.02) |
|
|
|
|
|
UNAUDITED STATEMENT OF COMPREHENSIVE INCOME
for the six months ended
|
Six months ended |
Six months ended |
Year ended £ |
|
(250,697) |
(256,038) |
(587,301) |
Other comprehensive income |
- |
- |
- |
|
(250,697) |
(256,038) |
(587,301) |
UNAUDITED BALANCE SHEET
as at
|
Notes |
As at |
As at |
As at £ |
Assets |
|
|
|
|
Non-current assets |
|
|
|
|
Exploration and evaluation assets |
|
1,611,820 |
1,057,573 |
1,165,077 |
Investments |
|
40,000 |
40,000 |
40,000 |
|
|
1,651,820 |
1,097,573 |
1,205,077 |
Current assets |
|
|
|
|
Trade and other receivables |
|
55,575 |
62,852 |
27,232 |
Cash and cash equivalents |
|
2,288,410 |
2,741,214 |
3,078,311 |
|
|
2,343,985 |
2,804,066 |
3,105,543 |
Total assets |
|
3,995,805 |
3,901,639 |
4,310,620 |
Liabilities |
|
|
|
|
Current liabilities |
|
|
|
|
Trade and other payables |
|
21,531 |
58,993 |
85,649 |
Provisions |
|
18,000 |
- |
18,000 |
Total liabilities |
|
39,531 |
58,993 |
103,649 |
Net assets |
|
3,956,274 |
3,842,646 |
4,206,971 |
Capital and reserves attributable to the CompanyÕs equity shareholders |
|
|
|
|
Share capital |
4 |
2,593,458 |
2,475,811 |
2,593,458 |
Share premium |
|
4,042,698 |
3,464,757 |
4,042,698 |
Share-based payment reserve |
|
167,924 |
167,924 |
167,924 |
Accumulated deficit |
|
(2,847,806) |
(2,265,846) |
(2,597,109) |
Total equity |
|
3,956,274 |
3,842,646 |
4,206,971 |
Unaudited Statement of Cash Flows
for the six months ended
|
|
Six months |
Six months |
Year |
Cash outflow from operating activities |
|
(346,351) |
(301,254) |
(543,846) |
|
|
|
|
|
Purchase of intangible assets |
|
(446,743) |
(415,326) |
(534,320) |
Purchase of investments |
|
- |
(20,000) |
(20,000) |
Interest received |
|
3,193 |
3,474 |
6,569 |
|
|
(443,550) |
(431,852) |
(547,751) |
|
|
|
|
|
Proceeds on issue of new shares |
|
- |
- |
800,000 |
Cost of issuing new shares |
|
- |
- |
(104,412) |
|
|
- |
- |
695,588 |
|
|
(789,901) |
(733,106) |
(396,009) |
|
|
3,078,311 |
3,474,320 |
3,474,320 |
|
|
2,288,410 |
2,741,214 |
3,078,311 |
Notes to the Unaudited Financial Information
for the six months ended
1 Accounting Policies
Basis of Preparation
These financial statements are for the six month period ended
The information for the year ended
A copy of the statutory financial statements for that period has been delivered to the Registrar of Companies. The Auditor's Report was not qualified, did not include a reference to any matters to which the Auditor drew attention by way of emphasis without qualifying the report and did not contain statements under section 498(2) or (3) of the Companies Act 2006.
The interim financial statements for the six months ended
The interim financial information in this report has been prepared in accordance with International Financial Reporting Standards ("IFRS") as adopted by the
The financial statements have been prepared under the historical cost convention. The principal accounting policies have been consistently applied to all periods presented.
Significant Accounting Policies
The accounting policies and methods of computation followed in the interim financial statements are consistent with those as published in the Company's Annual Report and Financial Statements for the
year ended
The Annual Report and Financial Statements are available from the Company Secretary at the Company's registered office,
Going Concern
The Directors have, at the time of approving the interim financial statements, a reasonable expectation that the Company has adequate resources to continue in operational existence for the foreseeable future. Thus they continue to adopt the going concern basis of accounting.
2 Loss per Share Attributable to the Equity Shareholders of the Company
Basic loss per share is calculated by dividing the earnings attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding during the period.
Given the Company's reported loss for the period, warrants are not taken into account when determining
the weighted average of ordinary shares in issue during the period and therefore the basic and diluted earnings per share are the same.
Basic loss per share |
Six months |
Six months |
Year ended pence |
Loss per share from continuing operations |
(0.01) |
(0.01) |
(0.02) |
The earnings and weighted average number of ordinary shares used in the calculation of basic earnings per share are as follows:
|
Six months |
Six months |
Year ended £ |
Earnings used in the calculation of total |
(250,697) |
(256,038) |
(587,301) |
Number of Shares |
Six months |
Six months |
Year ended
|
|
2,888,708,805 |
2,418,120,570 |
2,492,898,974 |
3 Taxation
There was no tax charge for the half yearly period due to the loss incurred. A deferred tax asset in respect of trading losses and share-based payments has not been recognised due to the uncertainty of timing of future profits. The trading tax losses are recoverable against suitable future trading profits.
4
At
At
At
5 Events after the Balance Sheet Date
There are no events after the balance sheet date to report.
6 Related Party Transactions
Jayne Bramhill, spouse of David Bramhill, received from the Company the sum of
7 Copies of the Half Yearly Report
A copy of the Half Yearly Report will shortly be posted to shareholders, and is now available on the Company's website www.unionjackoil.com.
This information is provided by RNS