RNS Number : 7539U
Mosman Oil and Gas Limited
30 March 2023
 

 

30 March 2023

 

 

 

 

Mosman Oil and Gas Limited

 ("Mosman" or the "Company")

 

Half Year Results

Mosman Oil and Gas Limited (AIM: MSMN) the oil exploration, development and production company, announces its Half Year results to 31 December 2022 (H123), a period in which it continued to build significant traction in oil and gas production across its US projects.

Summary

 

·       Revenue increased 26% to $936,187 (H122 $745,790)

·       Gross Profit increased 50% to $283,003 (H122 $188,487)

·       Net loss was $665,096 (H122 $498,940), as a result of investment in further development work, from which the production falls into the next period.

·       Net Production to Mosman of 13,170BOE (excludes Cinnabar which falls into current quarter)

·       Significant progress at Cinnabar in East Texas, with a development drilling programme leading to initial production in December 2022.

All amounts are in Australian Dollars

1BOE/boe - barrels of oil equivalent

2Gross Project Production -the production of BOE at a total project level (100% basis) before royalties (where Mosman is the Operator) and where Mosman is not the operator the total gross production for the project

3Net Production - Net to Mosman's Working interest before royalties

 

 

Post Period end

 

·       Cinnabar-1 well was completed and perforated, and subsequently the pipeline was completed and regular oil production and sales commenced.

·       Sacred Site Clearance Certificate received for EP 145, situated in the Amadeus Basin, from the Central Land Council (CLC).

·       Oil reserves for the Cinnabar project had increased by approximately 78%, which was determined from an updated independent Reserve Report.

·       The Board has announced a review of the corporate structure with the objective of maximising the Company's assets.

 

John W Barr, Chairman of Mosman commented: "The Group made solid progress in H123, with a focus on development at Cinnabar, at which, post year end, the proved reserves increased 78% to 1.58m gross boe.

 

"The H1 performance has provided a strong foundation for Mosman to increase production in the second half and the Board is highly encouraged with the progress being made in both the US and Australia."

 

Enquiries:

Mosman Oil & Gas Limited John W Barr, Executive Chairman Andy Carroll, Technical Director

jwbarr@mosmanoilandgas.com acarroll@mosmanoilandgas.com

 

NOMAD and Broker

SP Angel Corporate Finance LLP

Stuart Gledhill / Richard Hail / Adam Cowl

+44 (0) 20 3470 0470

Alma PR

Justine James / Pippa Crabtree

+44 (0) 20 3405 0205

+44 (0) 7525 324431

mosman@almapr.co.uk



 

Updates on the Company's activities are regularly posted on its website:

www.mosmanoilandgas.com

 

 

 

Notes to editors

Mosman (AIM: MSMN) is an oil exploration, development, and production company with projects in the US and Australia. Mosman's strategic objectives remain consistent: to identify opportunities which will provide operating cash flow and have development upside, in conjunction with progressing exploration of its existing exploration permit and permit application. The Company has several projects in the US. In addition to exploration projects in the Amadeus Basin in Central Australia.

 

 

Operations Review

 

Mosman's Strategic Objective remains to identify opportunities which will provide operating cash flow and have development upside, in conjunction with exploration of existing exploration permits. The strategic objective is achieved using a dual approach.  Oil and gas development and production in the USA, and exploration for hydrogen, helium, oil and gas in Australia.

 

More than $2.1m was spent on increasing production and exploration during the period. Mosman has made progress towards this objective with continued production at its existing USA projects and significantly the drilling and now production from the Cinnabar-1 well in Tyler County, Texas. The Board is pleased with this progress made in the last six months.

 

This project was acquired at modest cost when oil and gas prices were lower. Extensive technical work, including reprocessing and re-interpretation of 3D seismic, provided insight into the best location for the first re-development well. This technical work, and the investment in drilling, were more than justified by the excellent results achieved to date.

 

Recently, the company completed an independent report on the reserves at the Cinnabar project. Total proved reserves (gross) increased by approximately 78% from 887,000 to 1,581,000 gross boe.

 

 

Gross Reserves (MBOE):

 

Proved Developed Producing

Proved
Developed
Behind Pipe

Proved Undeveloped

Total Proved

Total Probable

Total Proved Plus Probable

302

147

1,132

1,581

65

1,646

 

 

In Australia's Northern Territory, Mosman published a new Prospective Resource estimate over the EP-145 lease where we hold 100% and continue to work to secure all required approvals for the next step of exploration.

 

Prospective Resources (Bcf)

Low Estimate

Best Estimate

High Estimate

Total Gas

12

440

2,290

Helium

0.3

26.4

229

Hydrogen

0.24

26.4

275

 

 

As shareholders and stakeholders expect, Mosman continues to take its Health and Safety requirements very seriously and to date there have been no health, safety or wellbeing issues reported in our small team.

 

Given the operational progress both during the period and after the reporting period, the Board looks forward with great optimism.

 

Results

 

The unaudited results for the six months to 31 December 2022 reflect a 26% increase in sales to $936,187 ($745,790 in 2021). Gross profit also increased by 50% to $283,003 ($188,487 in 2021).

 

The overall result for the period was a net loss of $665,096 (2021: $498,940).

 

The average sale prices achieved during the period was US$86.05 per barrel for oil, and US$6.34 per MMBtu for gas (in each case after transport and processing costs and prior to royalties).

 

These results do not include any revenue from the Cinnabar well which started in January 2023.

 

 

Projects

 

Mosman has Working Interests in several onshore producing projects located in the USA. The Company also owns one granted exploration permit and one application for an exploration permit in the Amadeus Basin in Central Australia.

 

Producing Projects in the USA

 

A summary of the current oil and gas projects as at 30 March 2023:

 

US PROJECTS

Asset/ Project1

Mosman Interest1

Location

Status2

Cinnabar (Cinnabar-1 well)

75%

Texas

Producing from January 2023

Stanley (various wells)

34.85% to 38.5%

Texas

Producing

Livingston

20%

Texas

Producing

Winters-1

29%

Texas

Producing

Winters-2

23%

Texas

Producing

Greater Stanley (Duff wells)

40%

Texas

Producing

Arkoma Stacked Pay

27% (held for sale)

Oklahoma

Producing

Falcon (Falcon-1 well)

75.0%

Texas

Currently shut-in

 

1All projects are operated by US subsidiaries of Mosman Oil and Gas Limited, except for Arkoma Stacked Pay, which is operated by Inland Operating Company.

2All leases are held by production. The Falcon lease was extended by agreement until August 2023.

 

Production Summary for the six months ending 31 December 2022

 


Gross Project Production2

BOE1

Net Production to Mosman3

BOE1

Cinnabar

-

-

Stanley

21,213

8,072

Winters

15,075

3,517

Livingston

1,769

354

Arkoma

                   4,912

1,227

Total Production

42,969

13,170

 

1BOE/boe - barrels of oil equivalent

2Gross Project Production - Means the production of BOE at a total project level (100% basis) before royalties (where Mosman is the Operator) and where Mosman is not the operator the total gross production for the project

3Net Production - Net to Mosman's Working Interest; Net Production attributable to Mosman means net to Mosman's Working Interest before royalties

 

 

Australia

 

AUSTRALIAN EXPLORATION PROJECTS

Asset/Project

Mosman Interest1

Location

Status

Permit Number

Licence Term

Comments

Australia, Amadeus Basin

100%

NT

Exploration

EP 1452

21 August 2025

Work program currently in place until 21 August 2023

Australia, Amadeus Basin

 

100%

(subject to farm-in dilution)

NT

Exploration

EPA 155

 

In application

 

Joint Venture partner currently raising capital to proceed

 

1. Mosman's ownership is working interest before royalties. The interest shown is approximate, as there are small variations on individual wells.

2. Mosman's wholly owned subsidiary, Trident Energy Pty Ltd is the operator of EP 145.

 

Mosman has continued to conduct technical work on its Central Australian exploration projects, focused on the 100% owned EP-145, in the Amadeus Basin, Northern Territory.

 

A new Prospective Resource estimate for EP 145 was published by Mosman in October 2022 and is detailed below.

 

Prospective Resources (Bcf)

Low Estimate

Best Estimate

High Estimate

Total Gas

12

440

2,290

Helium

0.3

26.4

229

Hydrogen

0.24

26.4

275

 

All seismic and drilling activities are subject to obtaining the necessary planning approvals from the NT Department of Industry and Resources, which are currently being coordinated by the project manager.

 

At Mosman's other central Australian project in EPA-155, the permit application is subject to a farmout with the next step being completion of Native Title negotiations.  Mosman understands that the farm-in partner is currently arranging funding.

 

Matters subsequent to the reporting period

 

Subsequent to the end of the reporting period the Company announced the following material matters occurred:

·      On 6 January 2023, the Group announced that the Cinnabar-1 well was completed and perforated, and subsequently on 16 January 2023 announced that the pipeline had been completed and regular oil production and sales had commenced.

·      On 20 February 2023, the Group announced that it had received a Sacred Site Clearance Certificate for EP 145, situated in the Amadeus Basin, from the Central Land Council (CLC).

·      On 15 March 2023, the Group announced that oil reserves for the Cinnabar project had increased by approximately 78%, which was determined from an updated independent Reserve Report.

·      On 28 March 2023, the Group announced the issue of 45,454,545 new ordinary shares of no-par value in the capital of the as full payment of a consulting fee at a price of 0.055p per share.

·      On 28 March 2023, the Group announced that it has commenced a corporate review to evaluate optimal next steps for Mosman and its shareholders, including the possibility of seeking a separate stock exchange listing of Trident and/or OilCo. To assist in the review process, the Group have engaged the services of Mr. David Minchin, a highly experienced helium exploration geologist with public company experience.

 

There were no other material matters that occurred subsequent to 31 December 2022.

 

 

Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income

For The Half Year Ended 31 December 2022

 

 

Notes

Consolidated

6 months to

31 December 2022

Consolidated

6 months to

31 December 2021

 

 

$

$



 

 

Revenue


936,187

745,790

Cost of sales

2

(653,184)

 (557,303)

Gross profit

 

283,003

188,487





Interest income


139

-

Other income


-

8,684

Administrative expenses


 (280,957)

 (148,375)

Corporate expenses

3

 (450,964)

 (358,235)

Directors fees


 (62,667)

 (60,000)

Exploration expenses incurred, not capitalised


 (9,300)

 (8,100)

Employee benefits expense


 (40,685)

 (35,408)

Finance costs


(5,676)

 (3,324)

Amortisation expense


(94,861)

 (81,564)

Depreciation expense


(919)

 (1,105)

Loss on foreign exchange


(2,209)

-

Loss from ordinary activities before income tax expense


(665,096)

(498,940)





Income tax expense


-

-

 




Net loss for the period


(665,096)

(498,940)

 




Other comprehensive profit




Items that may be reclassified to profit or loss




-

Foreign currency gain/(loss)


65,405

172,651

Total comprehensive income attributable to members of the entity


(599,691)

(326,289)

 


 

 

Basic loss per share (cents per share)


 (0.01) cents

(0.01) cents

Diluted loss per share (cents per share)


(0.01) cents

(0.01) cents

 

The accompanying notes form part of these consolidated financial statements

All amounts are in Australian Dollars

 

 

 



 

Consolidated Statement of Financial Position

As at 31 December 2022

 

 

Notes

Consolidated

31 December 2022

Consolidated

30 June 2022

 

 

 

$

$

 

 

 

 

Current Assets


 

 

Cash and cash equivalents


         810,376

2,354,689

Trade and other receivables

4

  852,971

787,040

Other assets 

5

109,848

 69,514

Total Current Assets


1,773,195

3,211,243





Non-Current Assets




Property, plant & equipment


                   7,366

 5,128

Oil and gas assets

6

          6,219,396

4,145,488

Capitalised oil and gas exploration

7

1,293,435

 1,240,541

Total Non-Current Assets


7,520,197

5,391,157





Total Assets


9,293,392

8,602,400





Current Liabilities




Trade and other payables

8

1,221,597

1,111,338

Provisions


28,654

 25,654

Total Current Liabilities


1,250,251

1,136,992




 

Non-Current Liabilities




Provisions


39,267

 38,617

Other payables


-

 145,159

Total Non-Current Liabilities


39,267

 183,776





Total Liabilities


1,289,518

1,320,768





Net Assets


8,003,874

7,281,632




 

Shareholders' Equity



 

9

40,065,365

 38,743,432

Reserves

10

771,702

706,297

Accumulated losses


(32,833,193)

(32,168,097)




 

Total Shareholders' Equity


8,003,874

  7,281,632



 

 

 

The accompanying notes form part of these consolidated financial statements

All amounts are in Australian Dollars

 

 

Consolidated Statement of Changes in Equity

For the Half Year Ended 31 December 2022

 

 

Accumulated

Losses

Contributed Equity

Reserves

Total

 

$

$

$

$

 

 

 

 

 

Balance at 1 July 2021

(29,812,181)

36,700,381

436,247

7,324,447

 

 

 

 

 

Comprehensive income





Loss for the period

(498,940)

-

-

(498,940)

Other comprehensive income for the period

-

-

172,651

172,651

Total comprehensive loss for the period

(498,940)

-

172,651

(326,289)

 

 

 

 

 

Transactions with owners, in their capacity as owners, and other transfers:

New shares issued

-

213,701

-

 213,701

Cost of raising equity

-

-

-

-

Options expired

 90,358

-

 (90,358)

-

Total transactions with owners and other transfers

 90,358

213,701

 (90,358)

  213,701

Balance at 31 December 2021

 (30,220,763)

36,914,082

518,540

7,211,859

 

 

 

 

 

Balance at 1 July 2022

(32,168,097)

38,743,432

706,297

7,281,632

 

 

 

 

 

Comprehensive income





Loss for the period

(665,096)

-

-

(665,096)

Other comprehensive income for the period

-

-

65,405

65,405

Total comprehensive loss for the period

                (665,096)

                                -  

                     65,405

                (599,691)

 

 

 

 

 

Transactions with owners, in their capacity as owners, and other transfers:

New shares issued

-

1,406,312

-

1,406,312

Cost of raising equity

-

    (84,379)

-

       (84,379)

Total transactions with owners and other transfers

-

1,321,933

-

1,321,933

Balance at 31 December 2022

(32,833,193)

40,065,365

771,702

8,003,874

 

 

 

 

 

 

The accompanying notes form part of these consolidated financial statements

All amounts are in Australian Dollars

 

 

Consolidated Statement of Cash Flows

For the Half Year Ended 31 December 2022

 

 

 

Consolidated

6 months to

31 December 2022   

Consolidated

 6 months to 31 December 2021

 

 

$

$

 

 

 

 

Cash flows from operating activities


 

 

Receipts from customers


922,683

635,709

Interest received & other income


-

47,309

Payments to suppliers and employees


(1,477,116)

(1,307,346)

Interest paid


(5,676)

(3,324)

Net cash outflow from operating activities


(560,109)

(627,652)



 

 

Cash flows from investing activities


 

 

Payments for property, plant and equipment


(3,629)

-

Payments for oil and gas assets


(2,108,026)

(436,452)

Acquisition of oil and gas production projects


-

(209,212)

Payments for acquisition of new subsidiaries


(145,158)

-

Payments for exploration and evaluation


(52,894)

(296,553)

Net cash outflow from investing activities


(2,309,707)

(942,217)

 

Cash flows from financing activities


 

 

Proceeds from shares issued


1,406,312

180,111

Payments for costs of capital


(84,379)

-

Net cash inflow from financial activities

 

1,321,933

180,111



 

 

Net decrease in cash and cash equivalents


(1,547,883)

(1,389,758)

Effects of exchange rate changes on cash and cash equivalents


3,570

48,460

Cash and cash equivalents at the beginning of the period


2,354,689

2,289,674

Cash and cash equivalents at the end of the period


810,376

948,376



 

 

 

The accompanying notes form part of these consolidated financial statements

All amounts are in Australian Dollars

 

 

For the Half-Year Ended 31 December 2022

All amounts are Australian Dollars

 

1. Summary of Significant Accounting Policies

 

   Statement of Compliance

The half-year financial report is a general purpose financial report prepared in accordance with the Corporations Act 2001 and AASB 134 Interim Financial Reporting. Compliance with AASB 134 ensures compliance with International Financial Reporting Standard IAS34 Interim Financial Reporting. The half-year report does not include notes of the type normally included in an annual financial report and should be read in conjunction with the most recent annual financial report.

 

Basis of preparation

The condensed consolidated financial statements have been prepared on the basis of historical cost, except for the revaluation of certain non-current assets and financial instruments. Cost is based on the fair values of the consideration given in exchange for assets. All amounts presented in Australian dollars, unless otherwise noted.

 

The accounting policies and methods of computation adopted in the preparation of the half-year financial report are consistent with those adopted and disclosed in the Group's 2022 annual financial report for the financial year ended 30 June 2022, except for the impact of the Standards and Interpretations described below. These accounting policies are consistent with Australian Accounting Standards and with International Financial Reporting Standards (IFRS).

 

Going Concern

The condensed consolidated financial statements have been prepared on the going concern basis, which contemplates continuity of normal business activities and the realisation of assets and the discharge of liabilities in the normal course of business.

 

The directors have considered the funding and operational status of the business in arriving at their assessment of going concern and believe that the going concern basis of preparation is appropriate, based upon the following:

 

·    The ability to further vary cash flow depending upon the achievement of certain milestones within the business plan and;

·    The ability of the Company to obtain funding through various sources, including debt and equity.

 

However, should the Group be unable to raise further required financing from equity markets or other sources, there is uncertainty which may cast doubt as to whether or not the Group will be able to continue as a going concern and whether it will realise its assets and extinguish its liabilities in the normal course of business and at the amounts stated in the financial statements.

 

The financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts nor to the amounts and classification of liabilities that might be necessary should the Group not continue as a going concern.

 

Exploration and Evaluation Costs

Exploration and evaluation expenditure incurred is accumulated in respect of each identifiable area of interest. These costs are carried forward in respect of an area for which the rights to tenure are current and that has not at reporting date reached a stage which permits a reasonable assessment of the existence or otherwise of economically recoverable reserves, and active and significant operations in, or relating to, the area of interest are continuing.

 

Impairment of Exploration and Evaluation Assets

The ultimate recoupment of the value of exploration and evaluation assets is dependent on the successful development and commercial exploitation, or alternatively, sale, of the exploration and evaluation assets.

 

Impairment tests are carried out when there are indicators of impairment in order to identify whether the asset carrying values exceed their recoverable amounts. There is significant estimation and judgement in determining the inputs and assumptions used in determining the recoverable amounts. If, after having capitalised the expenditure under the policy, a judgement is made that the recovery of the expenditure is unlikely, the relevant capitalised amount will be written off to profit and loss.

 

 

The key areas of judgement and estimation include:

 

·    Recent exploration and evaluation results and resource estimates;

·    Environmental issues that may impact on the underlying tenements; and

·    Fundamental economic factors that have an impact on the operations and carrying values of assets and liabilities.

 

Revenue Reporting

Revenue is measured at the fair value of the consideration received or receivable. Amounts disclosed as revenue are net of returns, trade allowances, rebates and amounts collected on behalf of third parties.

 

The group recognises revenue when the amount of revenue can be reliably measured, it is probable that future economic benefits will flow to the entity and specific criteria have been met for each of the Group's activities as described below. The group bases its estimates on historical results, taking into consideration the type of customer, the type of transaction and the specifics of each arrangement.

 

Revenue from joint operations is recognised based on the Group's share of the sale by the joint operation.

 

Interest revenue is recognised using the effective interest rate method, which, for floating rate financial assets, is the rate inherent in the instrument.

 

Oil and Gas assets

The cost of oil and gas producing assets and capitalised expenditure on oil and gas assets under development are accounted for separately and are stated at cost less accumulated amortisation and impairment losses. Costs include expenditure that is directly attributable to the acquisition or construction of the item as well as past exploration and evaluation costs.

 

When an oil and gas asset commences production, costs carried forward are amortised on a units of production basis over the life of the economically recoverable reserves. Changes in factors such as estimates of economically recoverable reserves that affect amortisation calculations do not give rise to prior financial period adjustments and are dealt with on a prospective basis.

 

Segment Reporting

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision maker. The chief operating decision maker, who is responsible for allocating resources and assessing performance.

 

New standards and interpretations

The consolidated entity has adopted all of the new or amended Accounting Standards and Interpretations issued by the Australian Standards Board ('AASB') that are mandatory for the current reporting period.

 

Any new or amended Accounting Standards or Interpretations that are not yet mandatory have not been early adopted.

 

 

 

Consolidated

6 months to 31 December 2022

Consolidated

6 months to 31 December 2021


$      

$


 

 

2     Cost of sales


Cost of sales

49,516

40,933

Lease operating expenses

603,668

516,370


653,184

557,303

 

Condensed Notes to the Financial Statements

For the Half-Year Ended 31 December 2022

All amounts are Australian Dollars

 


Consolidated 6 months to 31 December 2022

Consolidated

6 months to 31 December 2021


$      

$

3     Corporate Costs



Accounting, Company Secretary and Audit fees

150,109

92,945

Consulting fees - board

159,250

140,000

Consulting fees - other

31,302

42,632

NOMAD and broker expenses

74,728

38,091

Legal and compliance fees

35,575

44,567


450,964

358,235


 

 

  

 

Consolidated

Balance as at 31 December 2022

Consolidated

Balance as at 30 June 2022

 

$

$

4     Trade and Other Receivables

 

 

Joint interest billing receivables1

318,937

393,166

Deposits

55,014

54,875

GST receivable

25,382

19,250

Accrued revenue

406,133

318,399

Other receivables

47,505

1,350


852,971

787,040

1.     When appropriate, unpaid joint interest billing receivables are recovered from the interest holders share of production income.

 

5     Other Assets 



Prepayments

109,848

69,514


109,848

69,514

 

6     Oil and Gas Assets                                                                                      

Cost brought forward

4,145,488

3,328,029

Acquisition of oil and gas assets during the period

-

1,622,681

Capitalised equipment workovers during the period

2,108,026

697,070

Amortisation for the period

(94,861)

(237,194)

Impairment of oil and gas assets

-

(1,606,816)

Impact of Foreign Exchange on opening balances

60,743

341,718

Carrying value at the end of the period

6,219,396

4,145,488

 

7     Capitalised Oil and Gas Expenditure                                                  

                                        

Cost brought forward

1,240,541

706,702

Exploration costs incurred during the period

52,894

533,839

Impairment of oil and gas expenditure

-

-

Carrying value at end of the period

1,293,435

1,240,541

 

 

Condensed Notes to the Financial Statements

For the Half-Year Ended 31 December 2022

All amounts are Australian Dollars

 


Consolidated

Balance as at 31 December 2022

Consolidated

Balance as at 30 June 2022

 

$

$

8     Trade and Other Payables

 

 

CURRENT



Trade creditors

828,409

          900,748

Amounts owing for acquisition of Nadsoilco LLC

           147,601

          145,159

Other creditors and accruals

           245,586

          65,431


1,221,597

1,111,338

NON-CURRENT

 

 

Amounts owing for acquisition of Nadsoilco LLC

-

          145,159


-

          145,159

1.     The increase in trade creditors is primarily attributable to creditors in Nadsoilco LLC and relates to amounts owing for prepaid workover costs. The balance includes amounts payable on behalf of other royalty holders for which there are also receivables owing for their share of the workover costs (refer Note 9).

 

9     Contributed Equity

 


 

 


Ordinary Shares:

 


Value of Ordinary Shares fully paid

 

 

Movement in Contributed Equity

Number of shares

Contributed Equity $

Balance as at 1 July 2021:

3,767,763,052

36,700,381


08/07/2021

17/05/2022

Shares issued (ii)

Shares issued (i)

$0.00276

$0.00142

77,375,000

1,375,000,000

213,701

1,946,117

Capital raising costs


-

(116,767)

Balance as at 1 July 2022:


5,220,138,052

38,743,432


02/11/2022

Shares issued (i)

$0.00123

1,142,857,142

1,406,312

Capital raising costs


-

(84,379)

Balance at the end of period


6,362,995,194

40,065,365

 

(i)         Placements via capital raising as announced

(ii)        Shares issued upon conversion of warrants

 

 

 

 



Consolidated

Balance as at 31 December 2022

Consolidated

Balance as at 30 June 2022



$

$

10     Reserves


 

 

Options reserve


-

-

Foreign currency translation reserve


771,702

706,297



771,702

706,297

 

Foreign Currency Translation Reserve



Foreign Currency Translation Reserve at the beginning of the period

706,297

345,889

Current movement in the period

65,405

360,408

Foreign Currency Translation Reserve at the end of the period

771,702

706,297

 

 

11     Segment Information

 

 

The Group has identified its operating segments based on the internal reports that are reviewed and used by the board to make decisions about resources to be allocated to the segments and assess their performance.

 

Operating segments are identified by the board based on the Oil and Gas projects in Australia the United States. Discrete financial information about each project is reported to the board on a regular basis.

 

The reportable segments are based on aggregated operating segments determined by the similarity of the economic characteristics, the nature of the activities and the regulatory environment in which those segments operate.

 

The Group has two reportable segments based on the geographical areas of the mineral resource and exploration activities in Australia, the United States. Unallocated results, assets and liabilities represent corporate amounts that are not core to the reportable segments.

 

(i)       Segment performance

 

 

 

 

 

 

 

United States

$

Australia

$

Total

$

Period ended 31 December 2022


 



Revenue


 



Revenue


936,187

-

936,187

Other income


-

139

139

Segment revenue

 

936,187

139

936,326

 

 

 

 

 

Segment Result

 

 

 

 

Loss


 

 

 

Allocated


 

 

 

-      Corporate costs


(37,509)

(413,455)

(450,964)

-      Administrative costs


(156,566)

(124,391)

(280,957)

-      Lease operating expenses


(603,668)

-

(603,668)

-      Cost of sales


(49,516)

-

(49,516)





 

Segment net profit/(loss) before tax

 

88,928

(537,707)

(448,779)

 


 

 

 

Reconciliation of segment result to net loss before tax


 

 

 

 


 

 

 

Amounts not included in segment result but reviewed by the Board


 

 

 

-      Evaluation expenses incurred not capitalised


-

(9,300)

(9,300)

-      Amortisation


(94,861)

-

(94,861)

-      Impairment


-

-

-

Unallocated items





-      Employee benefits expense




(103,352)

-      Finance costs




(5,676)

-      Depreciation




(919)

-      Loss on foreign exchange




(2,209)

Net Loss before tax from continuing operations

 

 

 

(665,096)

 

 

 

 

 

 

 

 

 

United States

$

Australia

$

Total

$

Period ended 31 December 2021





Revenue





Revenue


745,790

-

745,790

Other income


-

8,684

8,684

Segment revenue

 

745,790

8,684

754,474

 

 

 

 

 

Segment Result

 

 

 

 

Loss


 

 

 

Allocated


 

 

 

-      Corporate costs


(35,045)

(323,190)

(358,235)

-      Administrative costs


    (94,108)

      (54,267)

    (148,375)

-      Lease operating expenses


   (516,370)

                 -  

   (516,370)

-      Cost of sales


     (40,933)

-

     (40,933)



 

 

 

Segment net profit/(loss) before tax


59,334

(368,773)

(309,439)


 

 

 

 

Reconciliation of segment result to net loss before tax


 

 

 

 


 

 

 

Amounts not included in segment result but reviewed by the Board


 

 

 

-      Evaluation expenses incurred not capitalised


-

(8,100)

(8,100)

-      Amortisation


(81,564)

-

(81,564)

-      Impairment


-

-

-

Unallocated items





-      Employee benefits expense




(95,408)

-      Finance costs




(3,324)

-      Depreciation




(1,105)

Net Loss before tax from continuing operations




(498,940)

 

 (ii)       Segment assets

 

 

 

 

United States

$

Australia

$

Total

$

As at 31 December 2022

 

 

 

Segment assets as at 1 July 2022

5,618,867

2,983,533

8,602,400

Segment asset balances at end of

period




-      Exploration and evaluation


8,474,353

8,474,353

-      Capitalised Oil and Gas

10,017,393


10,017,393

-      Less: Amortisation

(550,855)


(550,855)

-      Less: Impairment

(3,247,142)

(7,180,918)

(10,428,060)


6,219,396

1,293,435

7,512,831


 

 

 

Reconciliation of segment assets to total assets:

 

 

 

Other assets

1,292,086

488,475

1,780,561

Total assets from continuing operations

7,511,482

1,781,910

9,293,392

 

 

United States

$

Australia

$

Total

$

As at 30 June 2022

 

 

 

Segment assets as at 1 July 2021

4,925,917

2,798,680

7,724,597

Segment asset balances at end of

period




-      Exploration and evaluation

-

8,421,459

8,421,459

-      Capitalised oil and gas assets

     7,788,307

-

    7,788,307

-      Less: Amortisation

(449,441)

-

(449,441)

-      Less: Impairment

(3,193,408)

(7,180,918)


4,145,488

1,240,541


 

 

 

Reconciliation of segment assets to total assets:

 

 

 

Other assets

1,473,378

1,742,992

Total assets from continuing operations

5,618,867

2,983,533

 

 

 

 (iii)     Segment liabilities

 


United States

$

Australia

$

Total

$

As at 31 December 2022




Segment liabilities as at 1 July 2022

1,137,363

183,405

1,320,768

Segment liability increase/(decrease) for the period

(126,723)

95,473

(31,250)


1,010,640

278,878

1,289,518

Reconciliation of segment liabilities to total liabilities:

 

 

 

Other liabilities

-

-

-

Total liabilities from continuing operations

1,010,640

278,878

1,289,518

 

As at 30 June 2022




Segment liabilities as at 1 July 2021

29,380

370,770

400,150

Segment liability increase/(decrease) for the period

1,107,983

(187,365)

920,618


1,137,363

183,405

1,320,768

Reconciliation of segment liabilities to total liabilities:

 

 

 

Other liabilities

-

-

-

Total liabilities from continuing operations

1,137,363

183,405

1,320,768

 


 

12      Producing assets

 

The Group currently has 5 producing assets, which the Board monitors as separate items to the geographical and operating segments.

 

Project performance is monitored by the line items below.

 

 

 

Stanley

$

Falcon

$

Winters

$

Livingston

$

Arkoma

$

Other Projects

$

Total

$

Half-Year Ended 31 December 2022








Revenue








Oil and gas project related revenue

679,263

-

158,563

17,823

42,813

37,725

936,187

Producing assets revenue

679,263

-

158,563

17,823

42,813

37,725

936,187

 

 

 

 

 

 

 

 

Project-related expenses

 

 

 

 

 

 

 

-     Cost of sales

(34,616)


(10,997)

(821)

(3,082)

-

(49,516)

-     Lease operating expenses

(360,220)


(53,211)

(58,485)

(12,186)

(119,566)

(603,668)

Project cost of sales

(394,836)

 

(64,208)

(59,306)

(15,268)

(119,566)

(653,184)

 

Project gross profit

 

 

 

 

 

 

 

Gross profit

284,427

 

94,355

(41,483)

27,545

(81,841)

283,003

 

 

(i)       Project performance

 

 

 

 

 

 

 

Half-Year Ended 31 December 2021








Revenue








Oil and gas project related revenue

        321,220

322,803

6,390

7,455

41,386

46,536

 745,790

Producing assets revenue

321,220

322,803

6,390

7,455

41,386

46,536

745,790

 

 

 

 

 

 

 

 

Project-related expenses

 

 

 

 

 

 

 

-     Cost of sales

(15,008)

(22,307)

(294)

(344)

(2,980)

-

(40,933)

-     Lease operating expenses

(223,615)

(138,701)

(3,956)

(6,483)

(8,133)

(135,482)

(516,370)

Project cost of sales

(238,623)

(161,008)

(4,250)

(6,827)

(11,113)

(135,482)

(557,303)

 

 

 

 

 

Project gross profit

 

 

 

 

 

 

 

Gross profit

82,597

161,795

2,140

628

30,273

(88,946)

188,487

 


 

13     Expenditure Commitments

 

(a)       Exploration

 

The Company has certain obligations to perform minimum exploration work on Oil and Gas tenements held. These obligations may vary over time, depending on the Company's exploration programs and priorities. At 31 December 2022, total exploration expenditure commitments for the next 12 months are as follows:

 

 

Entity

Tenement

31 December 2022

$

31 December 2021

$

Trident Energy Pty Ltd

EP1451

-

-

Oilco Pty Ltd

EPA155

-

-

 

 

-

-

 

1.     EP145 is currently under extension until 21 August 2023, therefore there are no committed expenditures as of the date of this report.

 

(b)       Capital Commitments

 

The Company had no capital commitments at 31 December 2022 (2021 - $Nil).

 

14     Share Based Payments

 

A summary of the movements of all company warrant issues to 31 December 2022 is as follows:

 

Company Warrants

31 December 2022

Number of Options

30 June 2022

Number of Options

Outstanding at the beginning of the period

1,584,250,000

1,143,702,084

Expired

(376,000,000)

(169,577,084)

Exercised

-

(77,375,000)

Granted

571,48,571

687,500,000

Outstanding at the end of the period

1,779,678,571

1,584,250,000

Exercisable at the end of the period

1,779,678,571

1,584,250,000

 

 

15     Subsequent Events

 

Subsequent to the end of the reporting period the Company announced the following material matters occurred:

·      On 6 January 2023, the Group announced that the Cinnabar-1 well was completed and perforated, and subsequently on 16 January 2023 announced that the pipeline had been completed and regular oil production and sales had commenced.

·      On 20 February 2023, the Group announced that it had received a Sacred Site Clearance Certificate for EP 145, situated in the Amadeus Basin, from the Central Land Council (CLC).

·      On 15 March 2023, the Group announced that oil reserves for the Cinnabar project had increased by approximately 78%, which was determined from an updated independent Reserve Report.

·      On 28 March 2023, the Group announced the issue of 45,454,545 new ordinary shares of no-par value in the capital of the as full payment of a consulting fee at a price of 0.055p per share.

·      On 28 March 2023, the Group announced that it has commenced a corporate review to evaluate optimal next steps for Mosman and its shareholders, including the possibility of seeking a separate stock exchange listing of Trident and/or OilCo. To assist in the review process, the Group have engaged the services of Mr. David Minchin, a highly experienced helium exploration geologist with public company experience.

There were no other material matters that occurred subsequent to 31 December 2022.

 

15     Dividends

 

No dividends have been paid or proposed during the half year ended 31 December 2022.

 

Directors' Declaration

 

The Directors of the Consolidated Group declare that:

 

1.          The financial statements and notes, as set out on pages 7-23, are in accordance with the Australian Corporations Act 2001:

 

(a)       comply with Accounting Standards, which, as stated in Note 1 - Statement of Accounting Policies to the consolidated financial statements, constitutes compliance with International Financial Reporting Standards (IFRS); and

 

(b)       give a true and fair view of the consolidated financial position as at 31 December 2022 and of the performance for the period ended on that date of the Group.

 

2.      In the Directors' opinion there are reasonable grounds to believe that the Group will be able to pay its debts as and when they become due and payable.

 

This declaration is made in accordance with a resolution of the Board of Directors and is signed by authority for and on behalf of the Directors by:

 

 

John W Barr

Executive Chairman

30 March 2023

 

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