TIDMEO.
RNS Number : 7997Q
EnCore Oil PLC
10 August 2010
Press Release
For immediate release: 10 August 2010
EnCore Oil plc ('EnCore' or 'the Company')
Results for the Year Ended 30 June 2010
EnCore Oil plc (LSE: EO.) announces its audited results for the year ended 30
June 2010.
Highlights
Operational highlights
· Significant oil discovery at Catcher, up to 300mmbbls Oil in Place to
date with substantial potential upside in the rest of the block
· One well and two side-tracks drilled during the period
· Completion of the sale of 15 per cent. interest in Breagh gas discovery
to RWE Dea for a consideration of US$68.8million
· Agreement signed for divestment of onshore portfolio to Egdon Resources
plc for 39.2 million Egdon shares (29.998 per cent. of Egdon share capital) plus
GBP100,000 cash, which completed post year end
· Commencement of a share buy back scheme at less than inherent cash value
per share - 17 million shares purchased for cancellation
· Strengthened Board of Directors with the appointment of a new
Non-executive Chairman, a Non-executive Director and a new Executive Director
Financial highlights
· Profit of GBP11.4 million for year ended 30 June 2010
· Cash of GBP41.9 million as at 30 June 2010
· Debt free
· GBP22.9 million gain on the sale of Breagh gas discovery
For further information, please contact:
+------------------------------------------+----------------------+
| EnCore Oil plc | www.encoreoil.co.uk |
+------------------------------------------+----------------------+
| Alan Booth, Chief Executive Officer | +44 (0)20 7224 |
| | 4546 |
+------------------------------------------+----------------------+
| Eugene Whyms, Chief Financial Officer | |
+------------------------------------------+----------------------+
| Yvonne Fraser, Investor Relations | +44 (0)7957 241 |
| Manager | 408 |
+------------------------------------------+----------------------+
| | |
+------------------------------------------+----------------------+
| Westhouse Securities Limited | |
+------------------------------------------+----------------------+
| Tim Feather | +44 (0) 20 7601 |
| | 6100 |
+------------------------------------------+----------------------+
| Matthew Johnson | |
+------------------------------------------+----------------------+
Chairman's Review
Ten months ago, I took over the Chairmanship of EnCore from Mike Lynch who led
the company from its inception until it was well established and financially
strong. The Company had an experienced management team, a mixed portfolio of
onshore and offshore assets mainly concentrated on the UKCS North Sea, a market
capitalisation of around GBP46 million, significant cash resources and no debt.
Looking at that Company today, the management team has been further
strengthened, the onshore assets have been divested for a sizeable equity stake
in a focused, growing onshore player, the offshore assets have delivered a
significant oil discovery and the market capitalisation sits at around GBP161.8
million (as at 9 August 2010).
The discovery at Catcher and subsequent side-tracks are hugely significant for
EnCore, our joint venture partners and the UK North Sea industry as a whole. Not
since the Buzzard discovery in 2001, found by members of EnCore's management
team, has such a potentially significant UK North Sea oil discovery been made.
Our current estimates put up to 300 mmbbls of Oil in Place at Catcher (including
East and North) with significant further upside from the undrilled prospects on
the block. With that in mind, the joint venture partnership has confirmed that
we are to return to the Catcher area for two to four further exploration and
appraisal wells as soon as a rig is available with a view to better determining
the scale of the development required for the licence. Following this,
preparations will be made to move the project through to field development plan
(FDP) approval, anticipated to happen in 2011. EnCore is the operator of Catcher
and we are proud to be taking this important project forward.
Moving on to the other event which has shaped EnCore over the last year, our
asset divestment to Egdon Resources, an experienced onshore player, has now
completed (post period end) and we look forward to actively assisting Egdon as
they develop their portfolio. The Egdon transaction is a good example of the
approach which we, as a company, can undertake when presented with such an
opportunity. EnCore's prime focus is the development of our offshore interests.
Our onshore portfolio came about as part of our reverse takeover of Oil Quest
Resources plc and while we have spent some time in trying to build recognition
of the value in those assets, we determined that it was likely that only an
onshore focused player could do so successfully. The Egdon transaction has given
us the opportunity to realise some of the value in our portfolio, and hopefully
continue to create further value through our shareholding as Egdon moves its
assets forward.
Our company remains cash rich and debt free, and more importantly, we are able
to comfortably cover our proportion of costs on all foreseeable further
exploration and appraisal drilling at Catcher, and the appraisal well currently
drilling at Cladhan without the need to seek further funding. This leaves us in
the very healthy position of having cash in the bank, owning 15 per cent. and
being operator of the very significant Catcher oil discovery in the Central
North Sea, and having 16.6 per cent. of the Cladhan oil discovery in the
Northern North Sea, though we have yet to determine its size.
Looking to the future, the near to medium term will be dominated by further work
in the Catcher area to determine the scale of the discovery. Cladhan may also
prove to be a commercial discovery and we await the results of the appraisal
well. The gas storage marketing process is continuing and we will update the
market accordingly when further information is available and, of course, further
work on the other prospects in our portfolio is ongoing.
I would like to thank you, our shareholders, for your continued support through
these exciting times. In particular, I would like to thank the team at EnCore.
It is rewarding to know that all the technical work on the Catcher block has
been carried out in-house by the EnCore team which is a reflection of the talent
within that small team. Finally, I would also like to thank my predecessor, Mike
Lynch, for his dedication and commitment to the Company during his years of
service and for leaving us a company well placed to take advantage of the
opportunities which have since arisen.
Christine M.K. Wheeler O.B.E
Chairman
9 August 2010
Chief Executive's Review
2010 Review
I believe that 2010 has demonstrated that remaining focused on our strategy,
even through tough times, has generated significant value appreciation for our
shareholders. In 2009 we recognised that the market and business environment for
small cap E&P companies had changed markedly since 2008. We made a conscious
decision to preserve the capital we acquired from our Breagh sale, underpin our
share price through implementation of a share buyback scheme, create a clear and
transparent valuation for our onshore assets through our investment in Egdon,
and to invest only where we saw opportunity for successful drilling to make a
significant impact. We were especially fortunate that two key assets, Catcher
and Cladhan both required only modest capital investment and that if either was
successful could deliver a material change in our share price. I am happy to
admit that our pre drill estimate for the outcome of drilling at Catcher was
wrong; it has turned out to be much larger and have much better oil and
reservoir quality than we expected. The results of Catcher demonstrate that to
be successful at exploration in the North Sea you need to have: a willingness to
take risks, lots of patience, a healthy disregard for 'accepted wisdom' and last
but not least, some good luck. I think we can now look forward to the coming
year with a great deal of optimism and excitement.
The Year Ahead
Catcher: The results of drilling at Catcher have opened up a new play fairway in
this area of the North Sea. We are especially excited at the number of
additional prospects on the licence that appear to demonstrate similar seismic
characteristics to our Catcher discovery. We intend to return to the Catcher
block this autumn or early next spring, dependent upon rig availability, to
drill between two and four additional exploration and appraisal wells. Further
success on the block would suggest a cluster of oil accumulations with
potentially many hundreds of millions of barrels of oil in place. The low cost
of drilling, the ability to use either semi-submersible or jack-up rigs,
together with outstanding reservoir and oil quality would be likely to make this
a highly valuable discovery, with potentially significant strategic importance.
As operator EnCore is extremely well placed to progress the further exploitation
of the block. Of course until we know more about the size and scale of the
development project, it will be difficult to progress potential development
options in any detail. I believe our team is uniquely well suited to the task
ahead of us having been the management team that led the appraisal, Front End
Engineering and Design, regulatory FDP approval and the subsequent development
of the Buzzard Field between 2001 and 2005. Buzzard is currently the largest
field in the UKCS producing in excess of 200,000 barrels per day. We believe
that our very strong uncommitted cash position will ensure our ability to
continue to capture significant additional value in the Catcher area for an
extended period without the need for any additional funding.
Cladhan: At the time of writing, the Cladhan appraisal well has just begun. The
well is being drilled as a side-track to the original discovery well to target a
potential reservoir to the south of the currently established accumulation. The
location was designed to minimise the cost of drilling in the failure case
whilst enabling further side-tracking in the success case by drilling to a down
dip location to establish the location of any oil-water contact. We expect the
operations to complete within the next month, subject to any operational and
weather delays. We believe that Cladhan also has the potential to make a
significant impact on our valuation in the event of success as the upside
reserves potential on Cladhan is very significant, whilst the commerciality
threshold is quite low.
Gas Storage: As Christine mentioned, the marketing of our 100% owned Esmond gas
storage project continues, and we will update shareholders when further
information becomes available.
Exploration and Development Portfolio: During the year we continued to progress
the remainder of our portfolio. Last year we were all too aware of the lack of
value recognition for, amongst other things, our Onshore UK and France licences
and Ceres gas field. We subsequently achieved transparent value recognition for
these assets through an innovative arrangement with Egdon Resources. We are
currently examining how we might generate similar value recognition for our gas
discoveries at Schull, Old Head of Kinsale and Cobra, as well as our UK
exploration portfolio. There are a number of options that we believe may bring
both the recognition of value, and also expose our shareholders to further
activity and upside on these licences without significant further calls on our
capital resources which will be now be dedicated to Catcher and, if successful,
Cladhan.
We recognise that the current environment for value creation in the UKCS remains
challenging for smaller companies, although we are seeing the first signs of an
easing in both debt and equity markets which will hopefully help.
We are of the view that the UKCS will continue to provide unexpected significant
discoveries, although many future exploration successes are likely to be made
disproportionately by smaller players and new entrants to the North Sea. We hope
that the relevant authorities will continue to encourage the entrance of new
players and promote exploration for new accumulations by ensuring we have an
economic and fiscal environment that encourages the recognition and appropriate
reward for taking exploration risk. Additionally we need to ensure fair and
speedy access to existing, often mature infrastructure. Unless this latter issue
is addressed, and soon, then the undoubtedly significant benefits for the UK
from the full exploitation of the UK's indigenous natural resources is unlikely
to be recognised.
Alan Booth
Chief Executive Officer
9 August 2010
Operational Review
Catcher Drilling Programme
One well and two side-tracks were drilled during the period, all of which were
on UK Central North Sea Block 28/9 which contained the Catcher prospect. All
three wells were drilled using the Transocean Galaxy II heavy duty jack-up rig,
in waters of just over 300 feet. EnCore is Operator of Block 28/9 and has a 15
per cent. interest in the Block.
The first well, 28/9-1 drilled the Catcher prospect and commenced in May 2010.
This was a firm commitment well as part of the licence obligation, and resulted
in a light oil discovery of a minimum 240 feet oil column with calculated net
pay of 90 feet. The well reached a total measured depth (M.D.) of 5,219 feet
with oil discovered in the target Cromarty sandstone level at 4,600 feet M.D.. A
potential oil water contact was also intersected at 4,840 feet M.D.. Analysis of
the discovery indicated light oil with an API of approximately 30 degrees, a Gas
Oil Ratio (GOR) of 280 scf/bbl, viscosity at reservoir conditions of 4
centipose, sand porosities of approximately 34 per cent. and multi darcy
permeability.
A drill stem test was performed on well 28/9-1 to determine flow rate
characteristics but, although oil flowed naturally to the surface, due to a
mechanical failure in the test string, a meaningful flow rate was not
established. However, calculated flow rates and bottom hole and surface samples
reaffirmed the next step to side-track to the Catcher East formation.
The Catcher East side-track (28/9-1Z), the second well to be drilled during the
period, side-tracked 0.5km to the east of the original Catcher discovery into a
Lower Eocene Tay formation prospect. The purpose of this well was to determine
the presence of hydrocarbons to the East and whether the two accumulations were
linked. The well was drilled to 5,931 feet M.D. with no oil water contact
encountered. A 236 feet oil column was discovered with a net pay of 82 feet.
The pressure data and other results from this second well proved that Catcher
and Catcher East were a contiguous accumulation. EnCore has estimated that up to
300 mmbbls of Oil in Place is present in Catcher, Catcher East and the as yet
undrilled Catcher North, and there are a number of other significant structures
on the block.
The third well, started during the period and completed just after period end,
was the 28/9-1Y Catcher South West Appraisal side-track. This side track was
drilled downdip from the original Catcher discovery to better understand the
characteristics of the Catcher reservoir and to determine the presence of
additional reservoir sands. The well reached 6,255 feet M.D. and discovered a
173 feet hydrocarbon column with a net vertical sand thickness of 121 feet.
Additional sands were discovered and the results will be integrated into our
on-going evaluation of the Catcher accumulation.
EnCore's costs were carried by partners Premier Oil (uncapped) and Wintershall
(capped) for the first well in the Catcher drilling campaign and cost to EnCore
of the subsequent testing of the first well and two remaining side-track wells
totalled less than GBP1 million.
Post period end, during July and August 2010, a number of site surveys have been
carried out on the licence by Calegeo after which we intend to return to the
Catcher area to drill between two and four exploration and appraisal wells.
Discussions for a rig for this next phase continue and we expect to announce a
rig contract in the coming weeks.
Other Portfolio Activity
The sale to RWE Dea of our 15 per cent. interest in the Breagh gas field (UK
Southern North Sea Block 42/13a) completed at the beginning of the period for a
cash consideration of US$68.8 million. The details of the transaction were
covered in some depth in our 2009 Annual and Interim Reports.
In December 2009, the semi-submersible JW McLean rig was contracted to drill an
appraisal well at Cladhan in UK Northern North Sea Block 210/29a & 210/30a
(EnCore 16.6 per cent.). The well commenced post period end on 6 August 2010 and
results are expected within the next month. The well will help us gain a better
understanding of the extent and thickness of the Upper Jurassic reservoir sands
to ascertain the commerciality of the discovery.
Post period end, we also contracted Calegeo to carry out a site survey during
summer 2010 over Block 14/30 in the UK Central North Sea (EnCore 40 per cent.,
Operator) which contains the Tudor Rose oil accumulation. Thorough technical
work and evaluation has been carried out over the period and the outstanding
issue now is one of oil quality and viscosity. We believe the oil to have an API
of between 8.5 to the upper teens although this can only be proved with a well.
We believe the volume of oil in place at Tudor Rose to be in excess of 500mm
barrels, as such there may be potentially commercially recoverable volumes if we
can demonstrate suitable oil properties and productivity characteristics.
Elsewhere, we commissioned AMEC to carry out a conceptual study to look at
development options on the Cobra discovery, in UK Southern North Sea Blocks
48/1b, 48/1d & 48/2c (EnCore: 25 per cent., Operator). We are currently in
discussions with infrastructure owners regarding potential export routes for
Cobra gas before deciding upon the next steps with our partners. It is most
likely that the development concept would be a normally unmanned platform with
minimum facilities, linked by pipeline to the selected infrastructure. The 2008
well would be re-entered, to be completed as a production well after drilling a
horizontal lateral with multiple fracture treatments. If development is
sanctioned, subject to the tariff offer and positive project economics, along
with availability of export capacity, first gas could be in Q4 2012.
Onshore Portfolio / Egdon Resources
The transaction with Egdon Resources plc was signed in March 2010 and completed
post period end on 28 July 2010. This transaction has seen our onshore portfolio
(onshore UK and onshore France) along with our interest in the Ceres gas field
(UK Southern North Sea Block 47/9c, EnCore 10 per cent.) transferred to Egdon in
return for 39,200,000 ordinary shares in Egdon and GBP100,000 in cash upon
completion of the transfer of the French licences. EnCore is now Egdon's largest
shareholder with equity of just under 30 per cent. of Egdon's issued share
capital, and Alan Booth, Chief Executive Officer of EnCore has been appointed to
the Egdon Board of Directors as a Non-Executive Director. Other aspects of the
transaction include the provision by EnCore of a GBP1.5 million loan facility to
Egdon and the establishment of a Technical Services Agreement under which EnCore
will provide Egdon with technical, commercial and accounting services, to be
charged on a day-rate basis. EnCore has also made the commitment to retain its
shareholding in Egdon for a minimum of 12 months from the date of admission to
trading on AIM of the Egdon shares issued in consideration (29 July 2010), with
orderly market provisions for a further 12 months.
The Ceres gas field commenced production in late March 2010 and initial results
suggest that productivity will be in line with expectations.
Ireland
Progress on our Irish assets was limited during the period as the Operator,
Island Oil & Gas plc was the subject of a takeover by San Leon Energy plc. We
signed a collaboration agreement with Valhalla Oil & Gas Limited in December
2009 when the future of Island Oil & Gas plc was uncertain to allow us to exert
additional control of our Celtic Sea assets. Pre-development studies were
carried out during the period and discussions have taken place with
infrastructure owner, Kinsale Energy, over prospective tariff arrangements for
Old Head of Kinsale.
Applications have been made by the Operator to the Petroleum Affairs Division
(PAD) in Ireland for lease undertakings on the Schull (Exploration Licence 5/05,
EnCore 12.5 per cent.) and Old Head of Kinsale (Exploration Licence 4/05, EnCore
15.0 per cent.) licences to give the joint venture group a further period to
reach a declaration of commerciality.
In light of the lack of progress during the year, the discussions held over
tariff arrangements and future project economics, we made the decision that our
Irish assets have been impaired and as such, have taken a GBP4.9 million write
down on the assets this year.
Gas Storage
During the period, we received the results of a reservoir simulation study
carried out by Senergy, which confirmed the suitability of the Esmond field for
gas injection and withdrawal in both the upper and lower reservoirs. The 2007
feasibility study from AMEC was also updated to take into account the changes in
the development concept following the results of the November 2008 pressure test
well on Esmond. Both these studies were done with a view to assisting the
marketing of the project which began during the period. Jefferies has been
commissioned to conduct the marketing process which is ongoing.
Financial Review
Gain for the Financial Year
The net profit for the year to 30 June 2010 is GBP11.4 million (year to 30 June
2009 loss of GBP1.5 million). The operating loss is GBP15.1 million (2009 GBP3.2
million) comprising administrative expenses of GBP2.7 million (2009 GBP1.9
million) and exploration costs of GBP12.4 million (2009 GBP1.2 million).
The operating loss has been offset by a total gain of GBP22.9 million arising on
the sale of the Group's interest in the UK North Sea gas field Breagh in August
2009. The interest was held in two wholly owned subsidiaries of the Company. The
transaction was effected through the sale of the wholly owned EnCore (SNS)
Limited, which contained a 14 per cent. interest in the Breagh field offshore UK
for a consideration of GBP39.2 million and the sale of a one percent. interest
by the other subsidiary for a consideration of GBP2.7 million. The purchaser of
both parts was RWE Dea UK SNS Limited.
The gain on the sale of subsidiary in the year ended 30 June 2009 of GBP1.2
million related to the disposal of EnCore Oil Nederland B.V. to TAQA Energy
B.V.for $5.5 million.
Net financial income in 2010 was GBP0.3 million (2009 GBP0.4 million). Foreign
currency gains were GBP1.5 million in the year (2009 GBP0.1 million). The Breagh
sale consideration included a significant element of cash denominated in US
Dollars. Foreign currency gains reflected the weakening of sterling against the
US Dollar during the period. We locked in much of this gain by selling US
Dollars for sterling in the current year.
The gross administrative costs can be further analysed as follows:
+------------------------------+---------+---------+
| | 2010 | 2009 |
+------------------------------+---------+---------+
| | GBP | GBP |
| | million | million |
+------------------------------+---------+---------+
| Staff costs | 3.0 | 2.1 |
+------------------------------+---------+---------+
| Legal and professional | 0.2 | 0.6 |
+------------------------------+---------+---------+
| Office costs | 0.1 | 0.1 |
+------------------------------+---------+---------+
| Other | 0.2 | 0.1 |
+------------------------------+---------+---------+
| | 3.5 | 2.9 |
+------------------------------+---------+---------+
Gross administrative expenses, before capitalisation and recharges to joint
venture partners, were GBP3.5 million (2009 GBP2.9 million). Staffing levels
have again remained constant however the significant increase in our share price
in June 2010 has resulted in further provisions for employer social security
costs arising on unrealised gains on unexercised share options. The charge for
social security costs on options in the current year was GBP0.8 million whereas
administration costs in 2009 reflected a credit of GBP0.2 million as the share
price fell towards the end of that financial year and past provisions were
reversed.
Capitalisation and recharge to joint venture partners of administration costs
during the current year amounted to GBP0.8 million (2009 GBP1.0 million).
Consequently, net administration costs in the Profit and loss account were
GBP2.7 million (2009 GBP1.9 million).
Staff costs include GBP0.3 million (2009 GBP0.5 million) of IFRS 2 charges
related to share options granted to Directors, staff and third parties. No new
options have been granted since March 2009 and options issued in 2006 have now
been fully expensed.
Exploration costs of GBP12.4 million principally relate to the write down of
certain UK Onshore and Irish assets. In the case of the UK assets this followed
progress on field economics and negotiations with Egdon regarding the asset sale
completed in July 2010. The write down of the Irish assets reflects the poor
progress during the year and the tariff discussions with the Kinsale
infrastructure owners. Exploration costs in the year ended 30 June 2009 of
GBP1.2 million reflects the write down of costs accumulated on the Esmond/Gordon
Gas Storage project, GBP0.5 million, together with costs accumulated on
licences/blocks that have been or are to be relinquished.
Tax
The tax credit arising in the year to 30 June 2010 reflects the reversal of
deferred tax balances created on the fair value adjustments to intangible oil
and gas assets resulting from acquisitions in the year to 30 June 2007 and the
period to 30 June 2006. These deferred tax balances reverse via the Consolidated
Statement of Comprehensive Income when the asset is subsequently sold, as in the
case with Breagh, or the asset is impaired, as is the case with the impairment
of certain UK Onshore licences. This deferred tax movement is a non-cash item.
The Group has been advised that no tax liability should arise on the sale of
EnCore (SNS) Limited (which held a 14% interest in Breagh) or on the sale of
EnCore Oil Nederland B.V. owing to the availability of the Substantial
Shareholders Exemption.
Statement of financial position
At 30 June 2010 the Group had net assets of GBP58.4 million (30 June 2009
GBP49.2 million). The most significant balances are intangible exploration and
evaluation assets of GBP15.0 million (2009 GBP27.2 million) and cash of GBP41.9
million (2009 GBP5.4 million).
The exploration and evaluation assets can be further analysed as follows:
+------------------------------+---------+---------+
| | 2010 | 2009 |
+------------------------------+---------+---------+
| | GBP | GBP |
| | million | million |
+------------------------------+---------+---------+
| UK onshore licences | - | 7.7 |
+------------------------------+---------+---------+
| UK offshore licences | 12.5 | 12.3 |
+------------------------------+---------+---------+
| Other | 2.5 | 7.6 |
+------------------------------+---------+---------+
| | 15.0 | 27.6 |
+------------------------------+---------+---------+
During the year to 30 June 2010, the Company incurred expenditure of GBP2.7
million (2009 GBP14.7 million) on its oil and gas properties principally in
respect of the completion of the development of the Ceres field together with
the costs of drilling the Catcher discovery well. Costs in 2009 reflected
appraisal drilling on Breagh and Cladhan together with Ceres development costs.
Other exploration and evaluation assets include interests in Ireland and Western
Sahara.
In July 2010 the Group announced the completion of the transfer of the group's
onshore UK assets together with its interest in the offshore UK Ceres gas field
to Egdon Resources plc. At the 30 June 2010 the assets that form part of this
transaction have been reclassified as held for sale. The single largest item
within asset held for sale of GBP6.7 million is the carried cost of the Ceres
development being GBP5.3 million.
Cash Flow
The Group ended the year with GBP31.2 million of cash and cash equivalents (2009
GBP5.4 million) and a further GBP10.7 million of restricted cash (2009 Nil). The
Group remains debt free.
Restricted cash at 30 June 2010 includes GBP8.5 million ($12.9 million) being
part of the consideration for the sale of the Breagh field, which is held in an
escrow account for a period of 12 months from completion of the sale as security
against warranty or indemnity claims by the purchaser. We anticipate this cash
will be transferred to us in late August 2010.
A further GBP2.2 million is cash held in escrow accounts under arrangements with
a drilling contractors relating to the company's share of the cost of drilling
the Cladhan well (GBP1.7 million) and Catcher well (GBP0.5 million).
In the year ended 30 June 2010 the Company purchased 17,123,975 ordinary 5 pence
shares in EnCore Oil Plc, at less than the inherent cash value per share, at a
total cash cost, including expenses, of GBP2.5 million.
At 30 June 2010 approximately half of our cash is held on deposit with The Royal
Bank of Scotland and attracts floating rate interest. The balance is on deposit
with Scottish Widows on a mixture of fixed and variable rate accounts. Some use
has been made of short term deposits to enhance interest income. To date the
duration of these deposits has not exceeded three months.
At 30 June 2010 GBP28.7 million of cash was held in GB Pounds and GBP2.5 million
in US dollars. The majority of the restricted cash is US dollar denominated. The
Group is therefore exposed to some extent to the risk that movements in exchange
rates with GB Pounds will impact the value of cash and cash equivalents.
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
Year ended 30 June 2010
+----------------------------------------+--------------+-------------+
| | Year | Year |
| | ended 30 | ended 30 |
| | June 2010 | June 2009 |
| | GBP | GBP |
+----------------------------------------+--------------+-------------+
| Continuing operations | | |
+----------------------------------------+--------------+-------------+
| Impairment write down - exploration | (12,364,888) | (1,247,103) |
| costs | | |
+----------------------------------------+--------------+-------------+
| Administrative expenses | (2,756,601) | (1,942,491) |
+----------------------------------------+--------------+-------------+
| Operating loss | (15,121,489) | (3,189,594) |
+----------------------------------------+--------------+-------------+
| Gain on sale of subsidiary | 21,215,199 | 1,196,511 |
+----------------------------------------+--------------+-------------+
| Gain on sale of intangible exploration | 1,703,456 | - |
| and evaluation assets | | |
+----------------------------------------+--------------+-------------+
| Finance income | 288,942 | 401,312 |
+----------------------------------------+--------------+-------------+
| Finance costs | (10,947) | (6,052) |
+----------------------------------------+--------------+-------------+
| Other gains and losses | 1,476,017 | 90,301 |
+----------------------------------------+--------------+-------------+
| Profit/(loss) before taxation | 9,551,178 | (1,507,522) |
+----------------------------------------+--------------+-------------+
| Taxation | 1,888,670 | - |
+----------------------------------------+--------------+-------------+
| Profit/(loss) for the period | 11,439,848 | (1,507,522) |
| attributable to equity holders of the | | |
| parent | | |
+----------------------------------------+--------------+-------------+
| | | |
+----------------------------------------+--------------+-------------+
| Other comprehensive income | | |
+----------------------------------------+--------------+-------------+
| Exchange differences on translating | - | 29,719 |
| foreign operations | | |
+----------------------------------------+--------------+-------------+
| Foreign currency translation reserve | - | (42,737) |
| released on sale of subsidiary | | |
+----------------------------------------+--------------+-------------+
| Other comprehensive income for the | - | (13,018) |
| period | | |
+----------------------------------------+--------------+-------------+
| | | |
+----------------------------------------+--------------+-------------+
| Total comprehensive Income for the | 11,439,848 | (1,520,540) |
| period attributable to equity holders | | |
| of the parent | | |
+----------------------------------------+--------------+-------------+
| | | |
+----------------------------------------+--------------+-------------+
| | | |
+----------------------------------------+--------------+-------------+
| Earnings/(loss) for the period per | | |
| ordinary share (pence) | | |
+----------------------------------------+--------------+-------------+
| - Basic | 3.9 | (0.5) |
+----------------------------------------+--------------+-------------+
| - Diluted | 3.8 | (0.5) |
+----------------------------------------+--------------+-------------+
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
At 30 June 2010
+------------------------------------+-------------+-------------+
| | 30 June | 30 June |
| | 2010 | 2009 |
| | GBP | GBP |
+------------------------------------+-------------+-------------+
| ASSETS | | |
+------------------------------------+-------------+-------------+
| Non-current assets | | |
+------------------------------------+-------------+-------------+
| Intangible exploration and | 15,023,405 | 27,243,387 |
| evaluation assets | | |
+------------------------------------+-------------+-------------+
| Property, plant and equipment | | |
+------------------------------------+-------------+-------------+
| - oil and gas assets | - | 4,149,180 |
+------------------------------------+-------------+-------------+
| - other | 22,906 | 24,523 |
+------------------------------------+-------------+-------------+
| Investments | 50,000 | 50,000 |
+------------------------------------+-------------+-------------+
| | 15,096,311 | 31,467,090 |
+------------------------------------+-------------+-------------+
| | | |
+------------------------------------+-------------+-------------+
| Current Assets | | |
+------------------------------------+-------------+-------------+
| Other receivables | 639,495 | 343,834 |
+------------------------------------+-------------+-------------+
| Restricted cash | 10,684,802 | - |
+------------------------------------+-------------+-------------+
| Cash and cash equivalents | 31,183,559 | 5,405,072 |
+------------------------------------+-------------+-------------+
| | 42,507,856 | 5,748,906 |
+------------------------------------+-------------+-------------+
| Assets held for sale | 6,669,264 | 18,775,092 |
+------------------------------------+-------------+-------------+
| | 49,177,120 | 24,523,998 |
+------------------------------------+-------------+-------------+
| | | |
+------------------------------------+-------------+-------------+
| LIABILITIES | | |
+------------------------------------+-------------+-------------+
| Current liabilities | | |
+------------------------------------+-------------+-------------+
| Trade and other payables | (3,016,345) | (1,829,703) |
+------------------------------------+-------------+-------------+
| | (3,016,345) | (1,829,703) |
+------------------------------------+-------------+-------------+
| Liabilities directly associated | (190,775) | (954,416) |
| with assets classified as held for | | |
| sale | | |
+------------------------------------+-------------+-------------+
| | (3,207,120) | (2,784,119) |
+------------------------------------+-------------+-------------+
| | | |
+------------------------------------+-------------+-------------+
| Net current assets | 45,970,000 | 21,739,879 |
+------------------------------------+-------------+-------------+
| | | |
+------------------------------------+-------------+-------------+
| Non-current liabilities | | |
+------------------------------------+-------------+-------------+
| Provisions | (975,000) | (1,158,434) |
+------------------------------------+-------------+-------------+
| Deferred taxation | (1,702,841) | (2,872,582) |
+------------------------------------+-------------+-------------+
| | (2,677,841) | (4,031,016) |
+------------------------------------+-------------+-------------+
| | | |
+------------------------------------+-------------+-------------+
| NET ASSETS | 58,388,470 | 49,175,953 |
+------------------------------------+-------------+-------------+
| | | |
+------------------------------------+-------------+-------------+
| EQUITY | | |
+------------------------------------+-------------+-------------+
| Equity attributable to equity | | |
| holders of the parent | | |
+------------------------------------+-------------+-------------+
| Ordinary shares | 15,586,987 | 16,443,186 |
+------------------------------------+-------------+-------------+
| Capital Redemption Reserve | 856,199 | - |
+------------------------------------+-------------+-------------+
| Share premium | 37,798,714 | 37,798,714 |
+------------------------------------+-------------+-------------+
| Other Reserve | 266,908 | 266,908 |
+------------------------------------+-------------+-------------+
| Foreign Currency Translation | (316,893) | (316,893) |
| Reserve | | |
+------------------------------------+-------------+-------------+
| Retained earnings | 4,196,555 | (5,015,962) |
+------------------------------------+-------------+-------------+
| TOTAL EQUITY | 58,388,470 | 49,175,953 |
+------------------------------------+-------------+-------------+
| | | |
+------------------------------------+-------------+-------------+
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
+-----------------+------------+------------+------------+----------+-------------+-------------+-------------+
| | Attributable to parent company equity holders |
+-----------------+-------------------------------------------------------------------------------------------+
| GBP | Equity | Capital | Share | Other | Foreign | Retained | Total |
| | share |Redemption | premium | reserve | Currency | earnings | |
| | capital | Reserve | | |translation | | |
| | | | | | reserve | | |
+-----------------+------------+------------+------------+----------+-------------+-------------+-------------+
| | | | | | | | |
+-----------------+------------+------------+------------+----------+-------------+-------------+-------------+
| At 1 July 2008 | 16,443,186 | - | 37,798,714 | 266,908 | (303,875) | (3,979,404) | 50,225,529 |
+-----------------+------------+------------+------------+----------+-------------+-------------+-------------+
| | | | | | | | |
+-----------------+------------+------------+------------+----------+-------------+-------------+-------------+
| Loss for the | - | - | - | - | - | (1,507,522) | (1,507,522) |
| period | | | | | | | |
+-----------------+------------+------------+------------+----------+-------------+-------------+-------------+
| Released on | - | - | - | - | (42,737) | - | (42,737) |
| sale of | | | | | | | |
| subsidiary | | | | | | | |
+-----------------+------------+------------+------------+----------+-------------+-------------+-------------+
| Currency | - | - | - | - | 29,719 | - | 29,719 |
| translation | | | | | | | |
+-----------------+------------+------------+------------+----------+-------------+-------------+-------------+
| Total | - | - | - | - | (13,018) | (1,507,522) | (1,520,540) |
| comprehensive | | | | | | | |
| income for the | | | | | | | |
| period | | | | | | | |
+-----------------+------------+------------+------------+----------+-------------+-------------+-------------+
| Share option | - | - | - | - | - | 470,964 | 470,964 |
| expense | | | | | | | |
+-----------------+------------+------------+------------+----------+-------------+-------------+-------------+
| At 30 June 2009 | 16,443,186 | - | 37,798,714 | 266,908 | (316,893) | (5,015,962) | 49,175,953 |
+-----------------+------------+------------+------------+----------+-------------+-------------+-------------+
| | | | | | | | |
+-----------------+------------+------------+------------+----------+-------------+-------------+-------------+
| Profit for the | - | - | - | - | - | 11,439,848 | 11,439,848 |
| period | | | | | | | |
+-----------------+------------+------------+------------+----------+-------------+-------------+-------------+
| Total | - | - | - | - | - | 11,439,848 | 11,439,848 |
| comprehensive | | | | | | | |
| income for the | | | | | | | |
| period | | | | | | | |
+-----------------+------------+------------+------------+----------+-------------+-------------+-------------+
| Share option | - | - | - | - | - | 275,515 | 275,515 |
| expense | | | | | | | |
+-----------------+------------+------------+------------+----------+-------------+-------------+-------------+
| Own shares | (856,199) | 856,199 | - | - | - | (2,502,846) | (2,502,846) |
| bought back | | | | | | | |
+-----------------+------------+------------+------------+----------+-------------+-------------+-------------+
| | | | | | | | |
+-----------------+------------+------------+------------+----------+-------------+-------------+-------------+
| At 30 June 2010 | 15,586,987 | 856,199 | 37,798,714 | 266,908 | (316,893) | 4,196,555 | 58,388,470 |
+-----------------+------------+------------+------------+----------+-------------+-------------+-------------+
| | | | | | | | |
+-----------------+------------+------------+------------+----------+-------------+-------------+-------------+
The foreign currency translation reserve was used to record exchange differences
arising from the translation of the financial statements of subsidiaries that
were denominated in currencies other that GB Pounds. One of these subsidiaries
has been sold and the other has changed to a functional currency of GB Pounds.
The Other reserve arose on the reverse acquisition of Oil Quest Resources plc by
the EnCore Group in March 2006.
CONSOLIDATED STATEMENT OF CASH FLOWS
+----------------------------------------+--------------+--------------+
| | Year | Year |
| | ended | ended |
| | 30 June | 30 June |
| | 2010 | 2009 |
| | GBP | GBP |
+----------------------------------------+--------------+--------------+
| Cash flows from operating activities | | |
+----------------------------------------+--------------+--------------+
| Profit/(loss) before taxation | 9,551,178 | (1,507,522) |
+----------------------------------------+--------------+--------------+
| Depreciation | 14,781 | 25,842 |
+----------------------------------------+--------------+--------------+
| Share based remuneration charges | 275,515 | 470,964 |
+----------------------------------------+--------------+--------------+
| Exploration costs written off | 12,364,888 | 1,247,103 |
+----------------------------------------+--------------+--------------+
| Items shown as financing and investing | (24,668,889) | (1,690,704) |
| activities | | |
+----------------------------------------+--------------+--------------+
| Operating cash outflow prior to | (2,462,527) | (1,454,317) |
| working capital | | |
+----------------------------------------+--------------+--------------+
| Working capital adjustments | 970,281 | (398,587) |
+----------------------------------------+--------------+--------------+
| Cash used in operations | (1,492,246) | (1,852,904) |
+----------------------------------------+--------------+--------------+
| | | |
+----------------------------------------+--------------+--------------+
| Cash flows from investing activities | | |
+----------------------------------------+--------------+--------------+
| Purchase of intangible exploration and | (1,531,158) | (13,265,889) |
| evaluation assets | | |
+----------------------------------------+--------------+--------------+
| Purchase of field under development | (1,133,832) | (1,428,086) |
| assets | | |
+----------------------------------------+--------------+--------------+
| (Increase)/decrease in restricted cash | (10,053,829) | 3,913,542 |
+----------------------------------------+--------------+--------------+
| Purchase of property, plant and | (16,590) | (4,698) |
| equipment | | |
+----------------------------------------+--------------+--------------+
| Interest received | 205,877 | 411,119 |
+----------------------------------------+--------------+--------------+
| Proceeds from sale of property, plant | 4,891 | 12,328 |
| and equipment | | |
+----------------------------------------+--------------+--------------+
| Proceeds from sale of intangible | 2,665,126 | - |
| assets | | |
+----------------------------------------+--------------+--------------+
| Proceeds from sale of subsidiary | 38,793,428 | 2,999,317 |
+----------------------------------------+--------------+--------------+
| Net cash generated/(used) in investing | 28,933,913 | (7,362,367) |
| activities | | |
+----------------------------------------+--------------+--------------+
| | | |
+----------------------------------------+--------------+--------------+
| Cash flows from financing activities | | |
+----------------------------------------+--------------+--------------+
| Own shares repurchased | (2,502,846) | - |
+----------------------------------------+--------------+--------------+
| Interest paid and bank charges | (3,606) | (2,452) |
+----------------------------------------+--------------+--------------+
| Net cash used by financing activities | (2,506,452) | (2,452) |
+----------------------------------------+--------------+--------------+
| | | |
+----------------------------------------+--------------+--------------+
| Net increase/(decrease) in cash and | 24,935,215 | (9,217,723) |
| cash equivalents | | |
+----------------------------------------+--------------+--------------+
| Cash and cash equivalents at start of | 5,405,072 | 14,526,541 |
| period | | |
+----------------------------------------+--------------+--------------+
| Translation difference | 843,272 | 96,254 |
+----------------------------------------+--------------+--------------+
| Cash and cash equivalents at end of | 31,183,559 | 5,405,072 |
| period | | |
+----------------------------------------+--------------+--------------+
| | | |
+----------------------------------------+--------------+--------------+
| | | |
+----------------------------------------+--------------+--------------+
Notes
1. Basis of Accounting and Presentation of Financial Information
Whilst the financial information included in this announcement has been prepared
in accordance with International Financial Reporting Standards (IFRS), this
announcement does not contain sufficient information to comply with IFRS. The
Company will publish full financial statements that comply with IFRS in August
2010.
The financial information set out in the announcement does not constitute the
Company's statutory accounts for the year ended 30 June 2010 or the year ended
30 June 2009. The financial information for the year ended 30 June 2010 and the
year ended 30 June 2009 are extracted from the statutory accounts of EnCore Oil
plc. The auditors, PKF (UK) LLP, reported on those accounts; their report was
unqualified and did not contain a statement under section 498(2) or 498(3) of
the Companies Act 2006.
The Annual Report for the year ended 30 June 2010, including the auditors'
report, will be posted to shareholders during the week commencing 30 August 2010
and will be available from the same date both to be downloaded from the
Company's website at www.encoreoil.co.uk and in hard copy from EnCore Oil plc,
5th Floor, 62-64 Baker Street, London W1U 7DF.
The 2010 accounts have been prepared on a basis consistent with the accounting
policies set out in the 2009 accounts.
This announcement was approved by the board on 9 August 2010.
2. Impairment write down - exploration costs
+---------------------------------------------+------------+-----------+
| | 2010 | 2009 |
| | GBP | GBP |
+---------------------------------------------+------------+-----------+
| Exploration costs | 12,364,888 | 1,247,103 |
+---------------------------------------------+------------+-----------+
| Total impairment write down - exploration | 12,364,888 | 1,247,103 |
| costs | | |
+---------------------------------------------+------------+-----------+
In the year ended 30 June 2010 GBP6.8 million was written off the carried value
of certain UK onshore assets; GBP4.9 million from the value of our Irish
offshore assets and GBP0.7 million from the value of other assets. The Irish
assets were measured through value in use. Value is use is based on, amongst
other things, estimates of reserves, capex and operating expenditure together
with the use of a pre-tax discount rate of 10%.
The amounts written off during the year ended 30 June 2009 principally related
to the costs accumulated on the Esmond/Gordon Gas Storage project, GBP0.5
million, together with costs accumulated on licences/blocks that have been or
are to be relinquished.
3. Gain on sale of subsidiary
+--------------------------------------+--------------+-------------+
| | Year | Year |
| | ended 30 | ended 30 |
| | June 2010 | June |
| | | 2009 |
+--------------------------------------+--------------+-------------+
| | GBP | GBP |
+--------------------------------------+--------------+-------------+
| | | |
+--------------------------------------+--------------+-------------+
| Sale consideration | 39,239,760 | 3,046,747 |
+--------------------------------------+--------------+-------------+
| Less deductions: | | |
+--------------------------------------+--------------+-------------+
| Expenses of sale | (446,332) | (47,430) |
+--------------------------------------+--------------+-------------+
| Net proceeds | 38,793,428 | 2,999,317 |
+--------------------------------------+--------------+-------------+
| | | |
+--------------------------------------+--------------+-------------+
| Net assets at sale | | |
+--------------------------------------+--------------+-------------+
| Intangible oil and gas exploration | (17,480,479) | (1,831,107) |
| assets | | |
+--------------------------------------+--------------+-------------+
| Working capital balances | (97,750) | (14,436) |
+--------------------------------------+--------------+-------------+
| | (17,578,229) | (1,845,543) |
+--------------------------------------+--------------+-------------+
| Transfer from foreign currency | - | 42,737 |
| translation reserve | | |
+--------------------------------------+--------------+-------------+
| Gain on sale | 21,215,199 | 1,196,511 |
+--------------------------------------+--------------+-------------+
In August 2009 the Company sold its interest in the Breagh field offshore UK.
The interest was held in two wholly owned subsidiaries of the Company. The
transaction was effected through the sale of the wholly owned EnCore (SNS)
Limited, which was contained a 14 per cent. interest in the Breagh field
offshore UK for a consideration of GBP39.2 million and the sale of a one
percent. interest by the other subsidiary for a consideration of GBP2.7 million
(see note 4 below). The purchaser of both parts was RWE Dea UK SNS Limited. It
is anticipated that no tax liability will arise on the sale of EnCore (SNS)
Limited.
The gain on sale of subsidiary at 30 June 2009 reflects the sale by the Company
of its wholly owned subsidiary EnCore Oil Nederland B.V whose only asset was a
10 per cent. interest in the Amstel field offshore Netherlands for a
consideration of US $5.5 million, paid in cash. The purchaser was TAQA Energy
B.V.. It is anticipated that no tax liability will arise on the sale.
4. Gain on sale of intangible exploration and appraisal assets
+-----------------------------------------------+--------------+
| | Year ended |
| | 30 June |
| | 2010 |
+-----------------------------------------------+--------------+
| Sale consideration | 2,695,026 |
+-----------------------------------------------+--------------+
| Less deductions: | |
+-----------------------------------------------+--------------+
| Expenses of sale | (29,900) |
+-----------------------------------------------+--------------+
| Net proceeds | 2,665,126 |
+-----------------------------------------------+--------------+
| Less carried value of asset | (961,670) |
+-----------------------------------------------+--------------+
| | 1,703,456 |
+-----------------------------------------------+--------------+
In August 2009 the Company sold a one percent. interest in the Breagh field
offshore UK for a consideration of GBP2.7 million (see note 3).
5. Taxation
+-----------------------------------------------+-----------+----------+
| | 2010 | 2009 |
| | GBP | GBP |
+-----------------------------------------------+-----------+----------+
| Current taxation | - | - |
+-----------------------------------------------+-----------+----------+
| Deferred taxation | 1,888,670 | - |
+-----------------------------------------------+-----------+----------+
| | 1,888,670 | - |
+-----------------------------------------------+-----------+----------+
The tax credit arising in the year to 30 June 2010 reflects the reversal of
deferred tax balances created on the fair value adjustments to intangible oil
and gas assets resulting from acquisitions in the year to 30 June 2007 and the
period to 30 June 2006. These deferred tax balances reverse via the Consolidated
Statement of Comprehensive Income when the asset is subsequently sold, as in the
case with Breagh (see note 3), or the asset is impaired, as is the case with the
impairment of certain UK Onshore licences (see note 2).
6. Earnings/(Loss) per ordinary share
Basic earnings/(loss) per share amounts are calculated by dividing net
earning/(loss) for the period by the weighted average number of ordinary shares
outstanding during the period.
Diluted earnings/(loss) per share amounts are calculated by dividing the net
earnings/(loss) for the period by the weighted average number of ordinary shares
outstanding during the period plus the weighted average number of ordinary
shares that would be issued on the conversion of all the dilutive potential
ordinary shares into ordinary shares.
The following reflects the income and share data used in the basic and diluted
earnings per share computations:
+---------------------------------------------+------------+-------------+
| | 2010 | 2009 |
| | GBP | GBP |
+---------------------------------------------+------------+-------------+
| Earnings/(loss) for the year | 11,439,848 | (1,507,522) |
+---------------------------------------------+------------+-------------+
+---------------------------------------------+-------------+-------------+
| | 2010 | 2009 |
+---------------------------------------------+-------------+-------------+
| Basic weighted average number of shares | 296,152,537 | 307,360,839 |
+---------------------------------------------+-------------+-------------+
| Dilutive potential ordinary shares: | | |
+---------------------------------------------+-------------+-------------+
| Share options and warrants | 3,162,779 | - |
+---------------------------------------------+-------------+-------------+
| Diluted weighted average number of shares | 299,315,316 | 307,360,839 |
+---------------------------------------------+-------------+-------------+
As there is a loss in the year ended 30 June 2009, there is no difference
between the basic and diluted earnings per share.
7. Asset held for sale
+-----------------------------------------------+------------+------------+
| | 2010 | 2009 |
| | GBP | GBP |
+-----------------------------------------------+------------+------------+
| Intangible asset | 1,386,252 | 18,434,621 |
+-----------------------------------------------+------------+------------+
| Field in production - Ceres | 5,283,012 | - |
+-----------------------------------------------+------------+------------+
| Restricted cash | - | 340,471 |
+-----------------------------------------------+------------+------------+
| Asset held for sale | 6,669,264 | 18,775,092 |
+-----------------------------------------------+------------+------------+
| Trade creditors and accruals | - | (235,487) |
+-----------------------------------------------+------------+------------+
| Provisions | (190,775) | - |
+-----------------------------------------------+------------+------------+
| Deferred taxation | - | (718,929) |
+-----------------------------------------------+------------+------------+
| Liabilities directly associated with assets | (190,775) | (954,416) |
| classified as held for sale | | |
+-----------------------------------------------+------------+------------+
| | 6,478,489 | 17,820,676 |
+-----------------------------------------------+------------+------------+
In March 2010 the Group signed sale and purchase agreements with Egdon Resources
plc for the sale of the group's onshore assets (onshore UK and onshore France)
together with its interest in the Ceres gas field, in return for a material
equity stake in Egdon which will be classified in the Group Statement of
financial position as an investment in associate within Non-current assets.
These assets and the related liabilities have been reclassified as held for sale
pending completion of the transaction (see note 9).
The transfer to Egdon of the Groups UK onshore licences and interest in Ceres
was subject to the usual regulatory approvals from the Department of Energy and
Climate Change (DECC); and approval from the joint venture partners on each
licence and completed in July 2010. French regulatory consent will be required
for the sale of the subsidiary holding Encore's French licences.
As at 30 June 2009 the Group classified its share of UK Offshore Licence P1230
containing block 42/13 Breagh; and Licences P1327 and P1328 containing further
Breagh area blocks 42/8 42/9 42/14 and 42/12a as non-current assets held for
resale. These interests are jointly held by two 100% owned subsidiary companies.
The Group reported these items as assets held for sale and valued them at the
lower of their carried amount or fair value, less costs to sell, which did not
lead to an impairment loss in the year to 30 June 2009.
8. Equity structure
+-------------------------------------------+--------------+------------+
| | No. | GBP |
+-------------------------------------------+--------------+------------+
| Authorised - ordinary shares of 5 pence | 500,000,000 | 25,000,000 |
| each | | |
+-------------------------------------------+--------------+------------+
| | | |
+-------------------------------------------+--------------+------------+
| Ordinary shares | | |
+-------------------------------------------+--------------+------------+
| Allotted, called up and fully paid | | |
+-------------------------------------------+--------------+------------+
| | | |
+-------------------------------------------+--------------+------------+
| At 1 July 2008 and 1 July 2009 | 307,360,839 | 16,443,186 |
+-------------------------------------------+--------------+------------+
| Own Shares repurchased and cancelled | (17,123,975) | (856,199) |
+-------------------------------------------+--------------+------------+
| At 30 June 2010 | 290,236,864 | 15,586,987 |
+-------------------------------------------+--------------+------------+
In the year ended 30 June 2010 the Company purchased 17,123,975 ordinary 5 pence
shares in EnCore Oil plc at a total cost, including expenses, of GBP2,502,846.
The shares have been cancelled. The Capital Redemption Reserve includes an
amount equal to the nominal value of the own shares purchased. The total cost of
the share repurchases, including expenses, is deducted from returned earnings.
9. Post balance sheet events
In July 2010 the Group announced the completion of the transfer of the group's
onshore UK assets together with its interest in the offshore UK Ceres gas field
to Egdon Resources plc. At the 30 June 2010 the assets that form part of this
transaction have been reclassified as held for sale (see note 7). As a result of
the transaction the Group holds an equity investment in Egdon Resources plc
classified as an Investment in associate within Non-current fixed asset.
10. Annual General Meeting
The Annual General Meeting will be held at the offices of Dewey & LeBoeuf, No. 1
Minster Court, Mincing Lane, London EC3R 7YL on 14 October 2010 at 2.00 p.m.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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