ANNUAL
REPORT2017
AUSTRALIA
• Bounty group achieved record petroleum
revenue of $2.7 million in 2017 with:
• Tanzanian gas sales on stream for
whole period, and
• Improving oil prices supporting lower
oil output at Naccowlah, Qld
• Group petroleum revenue for the year up
44% to $2.7 million (2016: $1.08 million)
primarily due to gas sales
• Operating profit of $0.9 million (2016:
Loss $1.08 million) before non-cash impairments
• Cash and current assets at 30 June 2017 were
$2.39 million with nil debt
• Planning to commence oil production from southern
Surat Basin projects
TANZANIA – NYUNI BLOCK
• Kiliwani North (KN) gas field anticipated to contribute
revenue at lower rates in 2018
• Bounty seeking additional Tanzanian gas interests
• New 3D seismic planned to image deep water turbidite
gas plays of up to 1.3 TCF potential
ANNUAL GENERAL MEETING
The 2017 Annual General Meeting will be held at
Amora Hotel Jamison Sydney, 11 Jamison Street, Sydney NSW 2000
on 29 November 2017 commencing at 11.00 a.m.
The Notice of Meeting and Proxy Form have been mailed separately
from this Annual Report.
Bounty Oil & Gas NL Annual Report – 2017
TABLE OF CONTENTS
Key Outcomes
Chairman’s Review
CEO’s Review
Project and Operations Review
Corporate Governance Statement
Page
Inside
Cover
2
3 – 5
6 – 14
15
Directors Report including Remuneration Report
15 – 26
Auditor's Independence Declaration
Consolidated Statement of Comprehensive Income
Consolidated Statement of Financial Position
Consolidated Statement of Changes in Equity
Consolidated Statement of Cash Flows
Contents of the Notes to and Forming Part of the
Financial Statements
Directors Declaration
Independent Auditors Report to Members
27
28
29
30
31
32 – 54
55
56 – 59
Website
Bounty maintains a website at:
www.bountyoil.com
On our website you will find full
information about the Company.
Every announcement made to
the Australian Securities
Exchange (ASX) is published on
the website. You will also find
detailed information about the
Company's Exploration and
Production Permits.
Stock Exchange Listing
Bounty Oil & Gas N.L. securities
are listed on the Australian
Securities Exchange.
Additional Information Required by ASX Listing Rules
60 – 61
ASX Code: BUY
Schedule of Petroleum Tenements
Abbreviations
Corporate Directory
62 – 63
64 – 65
66
Bounty Oil & Gas NL
ACN: 090 625 353
ABN: 82 090 625 353
Annual General Meeting:
The 2017 Annual General Meeting will be held at Amora Hotel Jamison Sydney, 11 Jamison Street, Sydney NSW 2000,
on 29 November 2017, commencing at 11.00 a.m.
The Notice of Meeting and Proxy Form have been mailed separately from this Annual Report.
Bounty Oil & Gas NL Annual Report ‐ 2017
CHAIRMAN’S REVIEW
Dear Shareholder
This year, your company received more income from oil and gas production than ever before.
Petroleum revenue topped AU$2.68 million, with the major contributions coming from Tanzania gas, and the
Naccowlah Block oil in south west Queensland. Last year we predicted revenue from sales of Tanzanian gas at
AU$2.0 million, and this target was achieved.
Despite this excellent result, revenue reflected the continued slump in oil prices, brought about by oversupply in the
world market. The OPEC countries steadfastly refused to reduce their production, presumably in an attempt to
drive the US shale oil business into closure, but this did not happen. The USA producers drove their cost of
production down as the oil price remained low, due to USA Producers employing smarter operating methods and
new technologies. Recently, OPEC have reduced their daily production rate and there are now signs of the oil price
recovering.
Bounty recorded an operating profit of $896,000 before non –cash expenses of $1.28 million as a result of
conservative impairment and amortisation of oil and gas assets, as detailed in the Full Year Financial Report.
From an operations viewpoint, the Irtalie East 6 appraisal well in the Naccowlah Block, intersected oil in the
Birkhead Formation, and was cased and suspended for future production.
Bounty will pursue a number of projects in the Surat Basin, southern Queensland starting with workovers and
commencement of oil production at Alton while planning to re‐commence gas production at PL119 Downlands. We
are also always on the lookout to strengthen our land position in the Surat Basin. Alton has produced 2 million
barrels of oil with estimated remaining 2P reserves of approximately 1.136 million barrels and is a focus project.
Bounty has increased its interests in and continues studies on the Rough Range permits in Western Australia looking
for larger oil pools sourced from the onshore Carnarvon Basin.
The climate for farming out an interest in the 500 mmbl potential Azalea Prospect; AC/P32 has continued to remain
cool, as majors are showing minimal interest in new offshore exploration. However, a firming of the oil price should
see an increase in interest in exploration. PEP 11 remains a project for future review.
The company has not had to call on shareholders for further equity during the past year, because of the increased
revenue from Tanzania. This position might change if the opportunity arises, and the need to drill a well is justified
or as Bounty receives revenue from Kiliwani North it locates additional gas appraisal and production opportunities in
Tanzania with access to the gas pipeline system and gas market.
I again thank shareholders for their support this year, which has been one of consolidation for the company. I
would like to take this opportunity to thank my fellow Board members, and the Company's dedicated executive
team for their hard work during the year. This next year should be one of expansion for your Company.
Graham Reveleigh
Chairman
31 October 2017
2
Bounty Oil & Gas NL Annual Report ‐ 2017
CEO’S REVIEW
Introduction
Bounty’s petroleum revenue of $2.68 million for the year was a record and the group is aiming to lift revenue in
2018 by producing its 100% Surat Basin oil and gas development properties.
Oil seems to be in a recovery phase and the energy sector remains the world’s most important business exposed to
global growth.
The Australian Government and NSW regulators have identified serious gas production shortfalls in coming years
and Bounty is actively reviewing PL119 Downlands and its other Surat Basin gas production opportunities to
contribute to revenue growth. Bounty holds 15% of PEP 11 Offshore Sydney Basin in what will have the potential to
lead up to a new exploration drill of a major gas exploration project near Newcastle, NSW. Offshore operations are
not affected by the various onshore gas exploration road blocks.
Bounty anticipates good revenue growth in 2018 and beyond based on:‐
Tanzanian gas while it seeks other appraisal opportunities in Tanzania. Successful exploration of Bounty’s
Tanzania offshore targets longer term has the potential to launch Bounty as a significant gas producer with
increasing revenue in coming years.
Commencement of oil production in the Surat Basin, Queensland.
More details on current projects are set out in the Project and Operations Review below.
Highlights for the Year:
Bounty achieved record petroleum revenue up 149% to $2.68 million (2016:$1.08 million) with a major
contribution from Tanzanian gas sales.
Operating profit of $896,000 (2016: Loss $1.08 million) before non‐cash expenses including impairment and
amortisation of oil & gas assets of $1.28 million.
Net loss of $0.38 million (2016: $4.42 million).
Cash and current assets at 30 June 2017 were $2.39 million (2016: $1.92 million) with nil debt.
In Tanzania gas production from Kiliwani North 1 averaged 15 mmcfd in the second half of the year ended 30
June 2017.
Bounty is planning to commence oil and gas production in 2018 from its Surat Basin, Queensland assets and
is aiming to expand into other gas assets potentially in Tanzania.
Oil Business
Bounty continued to put resources into additional Queensland oil and gas production, development and exploration
areas.
SW Queensland – Eromanga Basin
Oil production decreased to 11,058 bbls (2016: 18,669 bbls) and with downward pressure on oil prices revenues
declined to $0.65 million.
On the production front the Santos Limited operated ATP 1189 Naccowlah Block has continued to provide oil
revenue but at lower rates due to the impact of lower oil prices and deferral of development drilling.
In July 2017 Bounty had success with the Irtalie East 6 appraisal well discovering good up dip oil in the Basal
Birkhead Formation. Additional appraisal wells are being considered in 2018.There are a potential 3 additional
appraisal locations in that area.
3
Bounty Oil & Gas NL Annual Report ‐ 2017
SE Queensland – Surat Basin
Petroleum Lease 2 Alton (PL2) – see Map in Project and Operations Review below.
Bounty is now operator of Petroleum Lease 2 and holds:
100% of the Alton Oilfield and Alton Block.
Alton is 440 km west of Brisbane and Alton oil will be transported and sold into the Brisbane Refinery.
Development reserves: 167,000 bbls of recoverable oil in the early Triassic age Basal Evergreen sand
reservoir included with a potential 1.136 million bbls of 2P reserves located in the three sands of the
Boxvale/Evergreen Formations.
Production facilities at Alton Oilfield.
Surrounding exploration acreage where there is considerable potential for further reserve additions with
undrilled locations and attic oil in the Evergreen Formation and possibly extensive oil in the lower
Showgrounds Formation which has been proven as a high productivity sand in the area.
Bounty is planning to commence oil production at Alton in March 2018 which is expected to generate additional
revenue of up to $1 million per annum with significant upside from four undrilled locations; enhanced recovery and
later an appraisal well at Eluanbrook (see below).
Bounty holds an 81.75% interest in the Kooroon JV within PL2 Alton and thereby controls appraisal of the
Eluanbrook Updip target in PL2.
The main features of Eluanbrook Updip are:
Development: The estimated recoverable resource is 186,000 bbls of oil from P50 OOIP of 625,000 bbls.
Middle Triassic age Showgrounds Sandstone reservoir.
Up dip from proven 53o API gravity oil with associated gas.
Oil Growth Projects ‐ AC/P32 Timor Sea
AC/P32 is located in the Ashmore Cartier region in the oil prone and prolific Vulcan Graben region.
Bounty’s efforts at farming out AC/P 32 have been made difficult by heavy oil price declines in 2016 and 2017 but
we are seeing signs of recovery in late 2017 and Bounty is aiming to obtain a farm‐out and subsequent drill test of
the Azalea Prospect. The prospect is located 25 km northeast of the Montara Oil Development in the Timor Sea.
Bounty’s current assessment is that there are at least two major stratigraphic prospects in the area with the
potential to discover 500 mmbbls original oil in place in the Cretaceous age Puffin Sandstone in the Azalea area (just
to the west of where the Wisteria 1 well was drilled in 2008) with 100 mmbbls recoverable oil. There is also the
potential to discover additional resources in the Jurassic age formations.
Bounty is negotiating to acquire the Cygnus/Polarcus long offset 3D data set to maintain its work commitment
program. The permit is in good standing until mid‐2019.
A discovery will lift Bounty into a major project and to being a mid‐level Australian oil operator.
Tanzania – Kiliwani North & Gas Commercialisation
Gas production from Kiliwani North 1 contributed net 471,343 mcf (83,355boe) to Bounty during the year.
Production rates were in the range 15 ‐ 30 MMcfg/d and are currently at under 10 MMcfg/d with the well curtailed
due to pressure testing.
All gas supplied is being sold under a Gas Sales Agreement with the Tanzania Petroleum Development Corporation
(TPDC) on a take or pay basis in US dollars at $3/MMbtu (approx. US$3.09 per Mcf), indexed to the US CPI and
delivered at well head. Bounty’s share of cash revenue during the year was A$2.03 million. The condensate
produced is stripped and being sold to third parties.
4
Bounty Oil & Gas NL Annual Report ‐ 2017
The Kiliwani project is the first step in what Bounty hopes will be further gas discoveries and development in the
large strategic Nyuni Block surrounding the production licence.
The new 517 km 36” diameter pipeline to Dar es Salaam now provides ample delivery capability for gas from
Kiliwani North and any subsequent discoveries which Bounty and its partners may make in the Block.
Tanzania ‐ Nyuni Area PSA
The Nyuni Area PSA was renewed in late 2011 for an eleven‐year period.
During the year ended 30 June 2017 Bounty increased its interest in the Nyuni PSA to 10%. This is increasing
Bounty’s direct participation in one of the most dynamic and successful new exploration plays worldwide.
Currently the operator, Aminex PLC, is negotiating a work program variation with TPDC to enable the acquisition of
deep water 3D seismic in the outboard sector of the PSA area and the deferral of the two exploration well drilling
commitment.
Once the variation to the work commitment licence has been granted, a re‐tender process is planned to select a 3D
seismic contractor capable of acquiring high resolution 3D seismic over the key Pande West lead in 2018 and to
identify other potential prospects in the deep water with a view to bringing them to drill‐ready status.
Bounty is seeking additional gas opportunities on the east coast of Tanzania.
Once the variations to the work program commitment have been approved a re‐tender process is planned to select
a 3D seismic contractor capable of acquiring high resolution 3D seismic over the key Pande West lead and to identify
other potential prospects in the deep water with a view to bringing them to drill ready status. Pande West is
analogous to some of the recent major deep‐water discoveries in the vicinity. The drilling success rate achieved by
other operators, based on 3D seismic in the main fairway east of Nyuni Area, is over 90%. The joint venture is
reviewing ways to enable the potential monetisation of discoveries on the shelf and deep water through delivery
into the Tanzania National Gas Gathering System.
Unconventional Gas Business
Looming gas supply shortages in eastern Australia continue to provide encouragement for the pursuit of
conventional and unconventional gas in PRL’s 33 – 49 (formerly PEL 218) (Nappamerri Project); Cooper Basin, South
Australia and for deep gas in some of Bounty’s other permits principally ATP 754P; Surat Basin.
Conclusion
Management continues to look for additional opportunities to be funded by gas revenue from Tanzania and most
pleasingly Bounty now has control of its own operated oil reserves at Alton in the Surat Basin which will be placed
on production in 2018.
On the Growth front Bounty is seeking additional opportunities so shareholders may also obtain good leverage
through a drill test in AC/P 32 Azalea and pursuit of our major gas prospects in Tanzania. Bounty holds excellent
Permits and is well placed for a recovery in the petroleum business.
PHILIP F. KELSO
Chief Executive Officer
31 October 2017
5
Bounty Oil & Gas NL Annual Report ‐ 2017
PROJECT and OPERATIONS REVIEW
Bounty Projects
Bounty has production and exploration operations in Africa and Australia.
Summary Land Position
Offshore Australia
AC/P 32
PEP 11
Offshore Tanzania
Nyuni PSA
Kiliwani North
Onshore Australia
Naccowlah Block Eromanga Basin
Nappamerri South Australia
Surat Basin Queensland
Rough Range Carnarvon Basin
Equity
100.00%
15.00%
Gross Km2
336.0
4576.5
Net Km2
336.0
686.5
10.00%
9.50%
2.00%
23.28%
Various
Various
1682
168.0
2544.1
1603.6
1134.4
872.1
168.2
16.8
127.2
373.3
640.5
784.8
Total
12916.7
3133.3
This table summarises Bounty’s land position as at 19 September 2017. Bounty’s full schedule of tenements as at 19
September 2017 is included in Additional Information Required by ASX Listing Rules at the end of this Annual
Report.
Bounty projects not specifically referred to below in this Project Review are summarised in Bounty’s 2017 Quarterly
Activity Reports to the ASX and on Bounty’s website: www.bountyoil.com
6
Bounty Oil & Gas NL Annual Report ‐ 2017
OIL BUSINESS
Production
Bounty’s petroleum production and sales for the year ended 30 June 2017 are summarised in the Review of
Operations set out in the Directors Report.
Development
ATP 1189P (formerly ATP 259P) Naccowlah Block and Associated PL’s SW Queensland ‐ Bounty 2%
Location: Surrounding Jackson, Naccowlah and Watson Oilfields
Background
The Naccowlah Block covers 2544 km2, 42% of which is covered by ATP 1189P and the remainder in 22 petroleum
leases (PL’s) covering producing fields. There is significant production infrastructure. This area produces 34 BOPD
net to Bounty and Bounty holds 2P + 2C (Contingent) reserves of 135,000 bbls. In past years the Operator (Santos
Limited) has been very successful in maintaining production at a constant level through production optimisation,
completing oil behind pipe and successful near field exploration, notably Irtalie East where Irtalie East 6 was cased
as a Birkhead future producer in July 2017.
The Jackson and Jackson South fields and associated production facilities are one of the largest in onshore Australia.
7
Bounty Oil & Gas NL Annual Report ‐ 2017
2016/17 Development
While low oil prices continue to challenge the economics of further development drilling, production and
optimisation work in the Naccowlah Block, further development drilling opportunities at the Irtalie East Field exist
and it is anticipated that additional wells will be drilled in 2018.
Surat Basin, Southeast Queensland
Group Interests in this project are
Permit
ATP 471 SG
ATP 754
PL 119/PL 441
Alton Oilfield
PL 2 C
PL 2 Alton
Kooroon JV Block
PL 2 A
PL 2 B
Status
Granted
Granted
Renewing
Granted
Granted
Granted
Granted
Interest
24.75%
50.0%
100.0%
100.0%
100.0%
81.75%
81.75%
Location: From Surat
Queensland
to Alton Oil Field,
Background
Bounty initially gained an interest in the Surat
Basin through the purchase of Ausam Resources
Pty Ltd in 2009, and has added to the acreage
it
through strategic acquisition.
acquired full control of PL 2. Hydrocarbons in
the southern part of the Surat Basin are
generated
in the underlying Bowen Basin
Permian sequence and are liquids rich. The oil is
trapped
the Triassic age Showgrounds
Sandstone and in the Evergreen Formation.
In 2016
in
The northern section of Bounty's acreage
includes the Permian age Tinowan Formation
which frequently has a liquids rich gas charge and in places, like Bounty's PL 119/441 Downlands property, good
porosity and permeability. Work continued on renewal of PL 119/441 during 2018.
8
Bounty Oil & Gas NL Annual Report ‐ 2017
PL 2 Alton ‐ Bounty 100%
PL 2 Kooroon Block – Bounty 81.75%
Location: 70 km. East of St George SE Queensland
Background
PL 2 (Alton Field) has to date produced over 2 million barrels from the Jurassic Age Evergreen Formation. Bounty
estimates 2P reserves at Alton of 1.136 million bbls.
2018 Operations
In 2018 Bounty will work over 2‐3 wells at Alton and commence oil production while it generates a full field
development plan including a plan to drill an up‐dip appraisal well at Eluanbrook in the northwest section of PL2.
Initial production of 45 bopd is expected from the Evergreen Formation and then moving to develop attic oil with
potential recoverable oil of 167,000 bbls.
Exploration ‐ Surat Basin, Queensland and Nappamerri Trough, South Australia
Other exploration projects in these Basins have been summarised in Bounty’s 2016/2017 Quarterly Activities
Reports to the ASX.
9
Bounty Oil & Gas NL Annual Report ‐ 2017
2017 Activities and Further Programmes
Growth Projects
AC/P 32 – Offshore Vulcan Sub‐basin, Ashmore and Cartier Territory ‐ Bounty 100%
Location: Offshore 500 Km west of Darwin, NT.
Background
This permit is located within the Vulcan Sub‐basin. In 2012
Bounty acquired a 100% interest in the permit and in June
2014 it was renewed for a further five years with a well
commitment in Year 2 and Year 5 if needed. The principal
target is the Azalea Prospect a 500 MMboip potential pool
with recoveries in the 20 ‐ 40% range.
The Azalea Prospect is:
Located in a prolific hydrocarbon province
Surrounded by multi‐million barrel oil fields
One of the largest untested potential oil pools in the
Timor Sea
Up dip from proven oil in Birch 1 and Swallow Oil Field
14 km to the west
Outlined by seismic amplitude and AVO anomalies
Associated with direct hydrocarbon indicators in the
form of gas chimneys, diagenetic and shallow gas zones overlying the up dip edge
Drill ready in water depths suitable for a jack up rig ~ 100 metres
2018 Exploration
Future Work
Interpretation and evaluation of the reprocessed seismic and inversion has defined the Azalea Prospect
with a potential 500 million barrels of oil in place of which over 100 million barrels would be recoverable.
In addition to Azalea; Bounty has established other new structural stratigraphic leads with potential in the
10 – 40‐million‐barrel recoverable range.
Bounty obtained an extension to the licence term from NOPTA to enable more definitive studies of the
potential fluid content of the Azalea Prospect and is negotiating to acquire the long offset modern 3D
seismic data recently acquired by Polarcus over the permit.
10
Bounty Oil & Gas NL Annual Report ‐ 2017
GAS/CONDENSATE BUSINESS
Development
Kiliwani North Development ‐ Nyuni Block
Offshore Mandawa Basin Tanzania – Bounty
9.5%
Location: 30 Km offshore from Rufiji Delta
Tanzania
Background
Kiliwani North 1 well was drilled in 2008 and hit
gas
in Neocomian (Lower Cretaceous age)
Sands, the same reservoir as at the adjacent
Songo Songo Gas Field. The field was tested at
40MMcfg/d and a reserve of 28 Bcf gas (Bounty
2.66 Bcf) was established.
A 24‐year
production Licence was issued in 2011.
Progress During 2017
Gas production
from Kiliwani North 1
contributed net 471,343 mcf (83,355boe) to
Bounty during the year. Production rates were
in the range 15 ‐ 30 MMcfg/d and but are
currently at under 10 MMcfg/d with the well
curtailed due to pressure testing.
11
Bounty Oil & Gas NL Annual Report ‐ 2017
Future Development 2018
Production to date has established gas reserves in the Kiliwani North pool at 18 BCF (1.71 BCF or 227,000 boes net
to Bounty.)
Growth Projects
Nyuni PSA Block – Offshore Mandawa
Basin Tanzania ‐ Bounty 10%
Location: 30 Km offshore from Rufiji
Delta Tanzania
Background
This licence lies up dip from over 20 Tcf
of gas discoveries which are in the early
stages of being bought on stream to a
three train LNG export facility onshore.
There are several
leads with
amplitude anomalies within the Nyuni
PSA Block which are stratigraphic targets
with potential for some 2.6 TCF gas, at
least half of which is in shallow water.
large
There has been over a 90% drilling
success rate with 3D seismic in adjacent,
analogous plays to the east of the Block
and over 185 TCF discovered to date in
the same play throughout Tanzania and
Mozambique.
Nyuni Block PSA Exploration – 2018
A 3D seismic survey is planned over the deep‐water area in the Permit during 2018 subject to deferral of exploration
wells.
Currently the operator, Aminex PLC, is negotiating a work program variation with TPDC to enable the acquisition of
deep water 3D seismic in the outboard sector of the PSA area and the deferral of the two exploration well drilling
commitment.
Once the variation to the work commitment licence has been granted, a re‐tender process is planned to select a 3D
seismic contractor capable of acquiring high resolution 3D seismic over the key Pande West lead in 2018 and to
identify other potential prospects in the deep water section with a view to bringing them to drill‐ready status. The
survey will be designed to detail the up‐dip extension of Lead 3 in the adjacent Ophir/RakGas East Pande permit
which independent consultants suggest could contain 1.3 TCF gas within Bounty’s Nyuni PSA area. There are
numerous other deep‐water channel/fan features apparent from the limited seismic coverage available with
associated seismic anomalies. The Exploration Licence is in good standing.
PEP 11, Offshore Sydney Basin, New South Wales – Bounty 15%
Background
PEP 11 covers 4,576 km2 of the offshore Sydney Basin immediately adjacent to the largest gas market in Australia
and is a high impact exploration project.
12
Bounty Oil & Gas NL Annual Report ‐ 2017
of
These prospects remain
one
the most
significant untested gas
plays in Australia. The
PEP 11 joint venture has
demonstrated
gas
considerable
generation
and
migration in the offshore
Sydney Basin, with the
previously
observed
mapped prospects and
leads
highly
being
prospective for gas.
2018 Exploration
During the period the
operator progressed its
plans for a 2D seismic
survey at Baleen to define a drill location located approximately 30 km south east of Newcastle, New South Wales in
PEP 11, as a work commitment for the petroleum title. This included engaging acoustic modelling specialists,
environmental consultants and geophysical expertise to complete the revisions to the Environmental Plan (“EP”)
following a request for modification and re‐submission received from the offshore regulator; the National Offshore
Petroleum Safety and Environmental Management Authority (NOPSEMA). This “Baleen HR” survey will cover
approximately 200‐line km and is also proposed to be tied‐in to the New Seaclem‐1 well location to provide
lithological control.
An application for suspension and extension of the permit term is pending approval from the National Offshore
Petroleum Title Administrator (NOPTA) to maintain the title in good standing.
Subsequent commitments in PEP 11 include 3D seismic acquisition and an exploration well. Potential discovery of
commercial quantities of natural gas in PEP 11 provides an exciting future for the PEP 11 Joint Venture including
Bounty considering the gas market demands emerging for the east coast of Australia.
The Looming gas shortage NSW has provided increased interest in the offshore potential of PEP 11.
13
Bounty Oil & Gas NL Annual Report ‐ 2017
Bounty Oil and Gas NL – Group Petroleum Reserves and Resources (As at 30 June 2017)
The Group has reviewed all Reserves and Resources to comply with Chapter 5 of the ASX listing rules, the result is
presented net to Bounty as at 30 June 2017:‐
MMboe8 (Recoverable)
Note
Discovered3
Producing4
Naccowlah
Kiliwani North
Total Producing
Contingent5
Alton Shut In
Alton Attic
Downlands Gas Field
Downlands Oil Leg
Eluanbrook
Kiliwani North
Naccowlah
Spring Grove
Total Contingent
Total Discovered
Undiscovered Prospective6
Surat (Mardi Prospect)
AC/P 32
Nyuni
PEP 11
Total Undiscovered
1P
0.044
0.227
0.271
1C
0.048
0.020
0.101
‐
0.016
0.185
0.456
Low
0.08
20
15
10.7
45.8
2P
0.078
0.227
0.305
2C
0.168
0.360
0.340
0.143
‐
0.04
0.347
1.397
1.703
Best
0.21
113
24
128.8
266.2
3P
0.13
‐
0.13
3C
0.360
0.340
0.197
0.608
0.100
0.347
1.951
2.081
High
0.42
302
44
128.8
475.4
1
1
1
1
1
2
2
2
1
2
2
2
2
2
Method / Notes
1.
2.
3.
4.
5.
6.
7.
8.
Deterministic Estimates – based on actual measurements of a petroleum reservoir and contained
petroleum.
Probabilistic Estimates (P90 ≡ 1P, P50 ≡ 2P, P10 ≡ 3P) – in probabilistic maths the solution or outcome
is a prediction with uncertainties that can be measured using chance or probability.
Drilled and proven moveable oil or gas
Discovered oil which is on production including nearby undeveloped oil
Discovered oil or gas whose commercial worth is contingent upon signing sales contract, production
testing and proving economic viability, shut in petroleum awaiting renewal of permit, or zones
adjacent to Discovered oil requiring further appraisal drilling
Specific targets for exploration based on volume estimation from seismic surveys and based on
untested models for hydrocarbon generation, migration and entrapment.
Estimates as at June 30, 2017
Converted at the rate of 182 boe = 1 MMcfg
Material Changes: Material changes from the prior period are:
1.
2.
3.
The transfer of Kiliwani North Contingent Resources to Producing, and
The inclusion of Contingent Resources from PL 2 Alton which was added to the land portfolio during
the period, and
Other changes due to production, and minor adjustments based on better data and slight changes in
categorisation of resources.
14
Bounty Oil & Gas NL Annual Report ‐ 2017
CORPORATE GOVERNANCE STATEMENT
Bounty Oil and Gas NL’s Corporate Governance Statement is on its website www.bountyoil.com and has been
released to the ASX.
DIRECTORS’ REPORT
Your directors present their report on the consolidated entity Bounty Oil & Gas NL (“Bounty”, “company” or “the
group”) being the company and its controlled entities for the financial year ended 30 June 2017.
Directors
The names of the directors in office at any time during or since the end of the financial year are:‐
G. C. Reveleigh
C. Ross
R. Payne
(Chairman)
(Non‐executive Director)
(Non‐executive Director)
Company Secretary
The following persons held the position of company secretary and chief financial officer of the group during the
financial year:
S. Saraf
Principal Activities
The principal activity of the company and the group during the financial year was that of exploration for,
development, production and marketing of oil and gas (petroleum). Investment in listed entities is treated as a
secondary activity and business segment.
There were no significant changes in the nature of the company’s principal activities during the financial year.
Operating Results
Consolidated loss of the group attributable to equity holders after providing for income tax amounted to $387,778
(see comparative details below).
Profit/(loss) from ordinary activities before
income tax
Consolidated
2017
$
Consolidated
2016
$
(387,778)
($4,427,200)
Income tax attributable to loss
‐
‐
Net profit/(loss) after income tax
(387,778)
($4,427,200)
Revenue from continuing operations for the period was $2,677,801 up 149% on the previous year (2016: $
1,077,497).
The operating loss was determined after taking into account the following material items:
Petroleum revenue; (mainly from oil and gas sales) of $$2,677,801
A realised and mark to market gain on listed securities of $8,775.
Direct petroleum operating expenses of ($634,119).
Employee benefits expense of ($781,870).
Non‐cash expenses for:
15
Bounty Oil & Gas NL Annual Report ‐ 2017
Impairment of production and development assets of
o
o Write off of capitalised exploration expenses of
o Amortisation expenses of
($ 834,259)
($10,263)
($439,242)
Details of drilling activity, exploration and development operations and cash flows for the year ended 30 June 2017
have been reported by the company to the Australian Securities Exchange in the Quarterly Activity Report and
Appendix 5B for each of the quarters during the year and in additional announcements on particular items.
A summary of revenues and results of significant business and geographical segments is set out in Note 4 to the
Financial Statements. Brief details are set out below:
Review of Operations
Production & Sales:
During the year ended 30 June 2017, the company:
Produced oil from several oil fields and leases operated by Santos Limited in ATP 1189P (formerly ATP 259),
Naccowlah Block, SW Queensland.
Produced and sold natural gas from Kiliwani North Licence, Tanzania operated by Aminex PLC.
Petroleum revenue and production in barrels of oil equivalent (boe) are summarised below:‐
Naccowlah
Block
Bounty Share
(2% interest)
646,783
11,058
Kiliwani North
Licence
Bounty Share
(10%)
2,031,018
83,355
Total
2,677,801
94,413
Revenue $
Production boe
Exploration and Development
Significant exploration and development operations during the year under review were:
Australia
Onshore
Cooper Basin, South‐western Queensland
Naccowlah Block; SW Queensland:
ATP 1189P (formerly ATP 259P): Oil production operations continued satisfactorily at the producing fields
including Jackson and from wells including recent wells on the Irtalie East Field.
Most Later Development Plans had been filed for the Petroleum Leases within the Naccowlah
Block ATP 1189P.
Further development drilling was deferred by the operator Santos Limited due to low oil prices
and pending cost cutting reviews however after the period a new development well – Irtalie East 6
was drilled and cased as a potential new producer from the Birkhead Zone. Further appraisal wells
in the Irtalie East ‐ Cooroo North West project areas are likely in 2018.
16
Bounty Oil & Gas NL Annual Report ‐ 2017
Surat Basin; Eastern Queensland:
Petroleum Lease 2 Alton:
Completed the transfer from Bridgeport (Surat Basin) Pty Ltd of all interests in the Alton Oilfield and Alton
Block (all in Petroleum Lease 2) to the Bounty group (see PL 2 Alton below).
Commenced planning to develop these reserves initially by producing oil from Alton Oilfield.
Bounty group now holds 100% of the Alton Oilfield, 100% of the Alton JV Block and 81.75%% of the
Kooroon JV all within Pl2 Alton.
As a result Bounty group is holding in the Alton Oilfield; development reserves of 167,000 bbls of
recoverable oil in the early Triassic age Basal Evergreen sand reservoir plus a potential 1.136 million bbls
of 2P reserves located in the three sands of the Boxvale/Evergreen Formations.
And an estimated recoverable resource of 186,000 bbls from P50 OOIP of 625,000 bbls in the Middle
Triassic age Showgrounds Sandstone reservoir at the Eluanbrook Prospect within that part of PL2 known as
the Kooroon JV.
Following commencement of oil production Bounty will continue development of these resources.
ATP 754P: Bounty group is now the operator of the ATP 754P joint venture and has cooperated with
Armour Energy (Surat Basin) Pty Ltd to file a Later Work Program for ATP 754P aimed at conducting a drill
test of the Mardi Prospect. Drilling of a multi‐zone test in ATP 754P is planned for 2018 to test for oil and
gas in several zones down to the Permian age sequence.
Offshore
AC/P 32 Ashmore Cartier Territory; Timor Sea: Bounty holds 100% of this potentially major project.
o
o
o
In 2012 Bounty acquired a 100% interest in the permit. The principal target is the Azalea Prospect a
500 MMbbl original oil in place potential pool with a recoverable oil estimate of 100 MMbbls.
At the end of the period Bounty was negotiating an extension to the licence term with the National
Offshore Titles Authority (NOPTA).
After the end of the period NOPTA granted an extension of the Year 1 to 3 program for Bounty to
licence and interpret 252km2 of the Polarcus Cygnus 3D Survey Data. This will enable more
definitive studies of the potential fluid content of the Azalea Prospect based on the long offset
modern data acquired over the area by that new 3D survey.
o
The Azalea Prospect is:
Located in a prolific hydrocarbon province – the Vulcan Sub‐basin.
Surrounded by multi‐million barrel oil fields.
One of the largest untested potential oil pools in the Timor Sea.
Up dip from proven oil in Birch 1 and Swallow Oil Field 14 km. to the west.
Outlined by seismic amplitude and AVO anomalies.
Associated with direct hydrocarbon indicators in the form of gas chimneys, diagenetic
and shallow gas zones overlying the up‐dip edge.
Drill ready in water depths suitable for a jack up rig – i.e. 120 metres.
17
Bounty Oil & Gas NL Annual Report ‐ 2017
PEP 11; offshore New South Wales: Bounty retains a 15% interest. The operator is planning to commence a 2D
seismic survey in late 2017 and the permit is in good standing. With major gas supply issues developing in
eastern Australia; the operator has identified a new target at Baleen Prospect with AVO analysis of seismic
data.
Other Properties
During the period, Bounty continued to fund exploration and development expenditure in connection with its other
operated and joint venture interests located in Queensland, South Australia and Western Australia. Bounty is
actively seeking additional projects.
Tanzania
During the period Bounty continued gas production and sales in Tanzania with accrued sales of $ 2,031,018. Gas is
sold under a Gas Sales Agreement (“GSA”) with the Tanzania Petroleum Development Corporation (“TPDC”).
The operator of the Kiliwani North Development Licence JV is Ndovu Resources Ltd (a subsidiary of Aminex PLC).
TPDC was invoiced for gas produced at the end of each month and the JV commenced receiving revenue during the
period. There were however several delays in receipt of revenue from TPDC.
During the half‐year ended 30 June 2017 gas production from the Kiliwani North‐1 well averaged 15 mmcf per day
and commissioning has been completed. Current production is 12 mmcfd.
Nyuni PSA:
Bounty has increased its interest to 10% and new 3D seismic was planned to image deep water turbidite gas plays of
up to 1.3 TCF potential for 2018.
A major gas target named Pande West has been identified in the deep water eastern section of the Nyuni Block
where Bounty holds a 5% interest and 3D seismic surveys are planned.
Corporate – Share Issues
During the year ended 30 June 2017 the company did not make any equity issues.
Dividends Paid or Recommended
No dividends have been paid or declared for payment for the year ended 30 June 2017 and no dividend is
recommended.
Financial Position
The net assets of the group reduced by $0.40 million in the period 1 July 2016 to 30 June 2017. The significant
underlying movements resulted from the following items:
o
o
Impairment of production and development assets of
$ 0.83 million.
Increase in net current assets by
$ 0.17 million.
At 30 June 2017 current assets were $ 2.40 million.
During the financial year the company invested:‐
$ 0.75 million on petroleum development property acquisitions and in completions and surface production
facility upgrades to further exploit its existing proved producing oil reserves and to increase its oil reserves.
$ 0.12 million in petroleum exploration projects in Australia and Tanzania as summarised in the Review of
Operations above.
18
Bounty Oil & Gas NL Annual Report ‐ 2017
The directors believe the company is in a stable financial position to expand and grow its current operations.
Significant Changes in State of Affairs
There have been no significant changes in the state of affairs of the company during the financial year.
Contingent liabilities and Contingent Assets
As at the date this report, there were no contingent assets or liabilities, other than the exploration commitments set
out in Note 21.
There was no litigation against or involving Bounty Oil & Gas N.L. or its subsidiaries.
Events after the Reporting Period
No matters or circumstances have arisen since the end of the financial year which have significantly affected or may
significantly affect the operations of the company, the results of those operations, or the state of affairs of the
company in future financial years.
Future Developments, Prospects and Business Strategies
Subject to the amount of its ongoing oil and gas revenues and the availability of new capital; consistent with that
income and the available cash reserves of the group, Bounty will continue:
Production, development and exploration for oil and natural gas (petroleum).
Expand in the business of the exploration for, development of and production of petroleum.
To conduct such operations principally in Australia and Tanzania.
In the coming year the group will focus on the:‐
Development of its existing oil reserves in the Surat Basin and in the Cooper Basin, Queensland aimed at
increasing group oil revenue;
Financing and if successful preparing to drill its major offshore oil targets in AC/P32, Timor Sea;
Acquisition of additional petroleum properties with existing petroleum production or reserves and resources
considered to have potential to develop and/or produce petroleum within an acceptable time frame;
Production of its developed gas reserves and deep water gas exploration in the Kiliwani North and Nyuni
Blocks, Tanzania; and
Development of new business opportunities including other overseas projects.
Environmental regulations or Issues
The company’s operations are subject to significant environmental regulation under the law of the Commonwealth
of Australia and its States and Territories in respect of its operated and non‐operated interests in petroleum
exploration, development and production. Its oil and gas production interests in the State of Queensland are
operated by Bounty group companies, AGL Energy Limited, Armour Energy (Surat Basin) Pty Ltd and Santos Limited
who comply with all relevant environmental legislation. Its offshore exploration operations in AC/P 32 Timor Sea are
conducted by the company in full compliance with all relevant environmental legislation of the Commonwealth of
Australia. Its non‐operated offshore operations in PEP 11, NSW are similarly conducted by Asset Energy Pty Ltd a
competent operator. Its non‐operated interests in Tanzania are operated by a company incorporated in that
jurisdiction which is a wholly owned subsidiary of a United Kingdom based operator. It complies with all relevant
environmental legislation.
19
Bounty Oil & Gas NL Annual Report ‐ 2017
Information on Directors
The names and particulars of the directors of the company during or since the end of the financial year ended 30
June 2017, are:‐
Graham Reveleigh
— Non‐Executive Director
Qualifications
— BSc. MSc, M. Aus IMM.
Experience
— Mr Reveleigh is a professional geologist and has nearly 48 years’ experience in the
resources industry both in Australia and overseas. Early in his career, he worked in
the oil industry, then spent most of his career in exploration, mine management
and construction in the mineral industry. Mr Reveleigh has had extensive
experience in petroleum in recent years as a director of Drillsearch Energy Limited
and its Canadian subsidiary. He retired as a director of those companies in late
2007. He is a Member of the Australasian Institute of Mining and Metallurgy and a
member of the Petroleum Exploration Society of Australia. He was appointed a
director and chairman in 2005.
Special responsibilities:
Chairman of the company; geotechnical advice.
Charles Ross
— Non‐Executive Director
Qualifications
— BSc.
Experience
Mr Ross has had extensive experience in the private and public equity and
corporate finance market in Canada, USA and Europe for 23 years. He has
operated extensively in corporate asset acquisition and divestiture, review and
development of corporate financing strategies, administration, compliance
procedures and investor relations in North America and the Euro zone. He was a
director of Circumpacific Energy Corporation (a subsidiary of Drillsearch Energy
Limited) from 1992 until 2008. This required management involvement in most
aspects of petroleum exploration, development and production operations in the
Western Canada Basin and other areas. He was appointed a director in 2005.
Special responsibilities:
Audit reviews; corporate strategy.
Roy Payne
— Non‐Executive Director
Qualifications
—
Solicitor Queensland.
Experience
Mr Payne is a commercial lawyer with over 32 years’ experience. Prior to working
in private practice as a lawyer he worked for the Department of Justice’,
Queensland for 12 years where he qualified to be a Clerk of the Court and a
Magistrate.
Mr Payne has many years of experience in the corporate world. He has been the
chairman of a listed mining exploration company. He is currently the chairman of
the board of a private ship maintenance and repair company and was the chairman
and director for many years of two limited liability, not for profit companies that
operate a public art gallery and a gallery foundation. He has a wealth of knowledge
and experience with corporate governance and mining exploration.
Special responsibilities:
Commercial law and Queensland statutory compliance.
20
Bounty Oil & Gas NL Annual Report ‐ 2017
Directorships of other listed companies
Directorships of other listed companies currently held by the directors or held in the 3 years immediately before the
end of the financial year are as follows:
Name
Company
Mr G. Reveleigh
Hill End Gold Limited
Mr C. Ross
TSX Listed Companies; Canada:
Goldex Resources Corporation, Norzan Enterprises Ltd.,
Halio Energy Inc. and Tearlach Resources Limited.
Mr R. Payne
Nil
Directors shareholdings
Period of directorship
1 July 2014 to present
1 July 2014 to present
NA
The following table sets out each Directors interest in shares and options over shares of the Company or a related
body corporate as at the date of this report:‐
Mr G. Reveleigh
Mr C. Ross
Mr R. Payne
Meetings of Directors/Committees
Bounty Oil & Gas NL
Fully paid ordinary shares
Number
Share options
Number
23,377,928
3,200,000
‐
‐
‐
‐
During the financial year, eleven (11) meetings of directors were held. Attendances by each director during the year
were as follows:‐
Directors’ Meetings
Number eligible to attend
Number attended
Mr G. Reveleigh
Mr C. Ross
Mr R. Payne
11
11
11
11
11
11
The company does not have separate audit or remuneration committees.
Indemnifying Officers or Auditor
During the financial year ended 30 June 2017 the company has not entered indemnity and access deeds with any of
the directors indemnifying them against liabilities incurred as directors, including costs and expenses in successfully
defending legal proceedings. The company has not, during or since the financial year, in respect of any person who
is or has been an auditor of the company or a related body corporate indemnified or made any agreement for
indemnifying against a liability incurred as an auditor, including costs and expenses in successfully defending legal
proceedings.
21
Bounty Oil & Gas NL Annual Report ‐ 2017
The company has paid premiums to insure each of the directors and officers in office at any time during the financial
year against liabilities up to a limit of $10 million for damages and for costs and expenses incurred by them in
defending any legal proceedings arising out of their conduct while acting in the capacity of director of the company,
other than conduct involving a wilful breach of duty in relation to the company. The amount of the premium was
$13,900 for all nominated directors.
Share Options
All options over ordinary shares or securities of Bounty Oil & Gas NL issued in a prior period have lapsed
unexercised. No options were issued during the year ending 30 June 2017 or have since been issued up to the date
of this report.
Accordingly at balance date on 30 June 2017 and at the date of this report, no unissued ordinary shares or securities
of Bounty Oil & Gas NL or any other entity comprising the consolidated entity were under option. No ordinary shares
of the company were issued pursuant to exercise of options during the year ending 30 June 2017.
Legal Matters or Proceedings on Behalf of Company
No person has applied for leave of Court to bring proceedings on behalf of the company or intervene in any
proceedings to which the company is a party for the purpose of taking responsibility on behalf of the company for all
or any part of those proceedings.
The company was not a party to any such proceedings or any other litigation during the reporting period.
Non‐Audit Services
The independent auditor to the company; Mr William Moyes has not provided non audit services to the company
during or after the end of the financial year.
Remuneration of Directors and Management
Information on the remuneration of directors and other key management personnel is contained in the
Remuneration Report which forms part of this Directors Report and is set out on the following pages.
Auditor’s Independence Declaration
The auditor’s independence declaration for the year ended 30 June 2017 has been received and can be found on
Page 27.
Signed in accordance with a resolution of the Board of Directors made pursuant to s. 298(2) of the Corporations Act
2001.
On behalf of the Directors.
GRAHAM REVELEIGH
Chairman
Dated: 29 September 2017
22
Bounty Oil & Gas NL Annual Report ‐ 2017
REMUNERATION REPORT
This remuneration report forms part of the Directors Report for the year ended 30 June 2017 and details the nature
and amount of remuneration for the Bounty Oil & Gas NL non‐executive directors and other key management
personnel of the group.
The prescribed details for each person covered by this report are detailed below under the following headings:
Director and senior management details
Remuneration policy
Non‐executive directors policy
Senior management personnel policy
Remuneration of directors and key management
Key terms and employment contracts
Directors and Key Management details
The term “key management” as used in this remuneration report to refers to the following directors and executives.
Directors
The following persons acted as directors of the company during or since the end of the financial year:‐
Mr G. C. Reveleigh
(Chairman)
Mr C. Ross
(Non‐Executive Director)
Mr R. Payne
(Non‐Executive Director)
Executives
The following persons acted as senior management of the company during or since the end of the financial year:
Mr P. F. Kelso
(Chief Executive Officer)
The company does not consider other employees and consultants to be Key Management Personnel.
Remuneration policy
The remuneration policy of Bounty Oil & Gas NL has been designed to align key management personnel objectives
with shareholder and business objectives by providing a fixed remuneration component and bonuses issued at the
discretion of the board of the company. The board of Bounty Oil & Gas NL believes the remuneration policy to be
appropriate and effective in its ability to attract and retain the best key management personnel to run and manage
the company, as well as create goal congruence between directors, executives and shareholders.
All remuneration paid to key management personnel (directors and others) is valued at the cost to the company and
expensed or where appropriate transferred to capital items. Shares issued to key management personnel are
valued as the difference between the market price of those shares and the amount paid by the key management
person. Share options are valued using the Black‐ Scholes methodology. Shares and options granted to key
management personnel (directors and others) are subject to any necessary approvals required by the ASX Listing
Rules.
23
Bounty Oil & Gas NL Annual Report ‐ 2017
Performance‐based remuneration
Given the long‐term nature of and risk variables involved in exploration and development of petroleum resource
projects as compared to other sectors e.g. retail revenues; remuneration of directors or other key management
personnel is not performance based.
Non‐executive directors’ policy
The board policy is to remunerate non‐executive directors at market rates for time, commitment and
responsibilities. The maximum aggregate amount of fees that can be paid to non‐executive directors is within the
maximum amount specified in the company's Constitution. Any increase of that amount is subject to approval by
shareholders at the Annual General Meeting. Fees for non‐executive directors are not linked to the performance of
the company.
Remuneration of non‐executive directors is determined by the Board exclusive of the director under consideration
after considering the individual time commitment, duties and function of the subject Director. Further
considerations of the amount of remuneration are made by referral to amounts paid to Directors, both executive
and non‐executive, by other listed entities of comparable size to the Company in the oil and gas exploration
industry.
The board of directors as a whole determines the proportion of any fixed and variable compensation for each other
key management person.
Any consulting fees payable to Directors as to specific projects outside the normal day to day duties of the Directors
are agreed upon prior to commencement of work on the specific projects.
The company makes cash bonus payments to key directors from time to time. Bonus payments by way of share
based payments are made from time to time subject to any necessary shareholder approval. All such payments are
expensed at the time of issue at the prevailing market price.
Each director is paid in cash. Shares and share options have on occasions been granted to directors as part of their
remuneration.
Senior management personnel policy
The board's policy for determining the nature and amount of remuneration of key management personnel who are
senior management executives of the company is as follows:‐
The remuneration structure comprises a combination of, short term benefits including base fees and long‐term
incentives and is based on a number of factors, including length of service, particular experience of the individual
concerned, and overall performance of the company. The contracts for service between the company and key
executive management personnel are for fixed terms which may continue at the end of the term. There were no
provisions for retirement benefits in contracts with senior management executives of the company made or
continued during the year ended 30 June 2017.
The company may make cash bonus payments to senior management executives and to selected employees from
time to time. Bonus payments and long‐term incentives by way of share based payments are classed as long‐term
incentives and are made from time to time subject to any necessary shareholder approval. All such payments are
expensed at the time of issue at the prevailing market price.
Key management personnel who are employees receive a superannuation guarantee contribution required by the
government and do not receive any other retirement benefits. Some individuals, however, have chosen to sacrifice
part of their salary to increase payments towards superannuation.
The chief executive officer, Mr P. F. Kelso, is engaged through a fixed term service agreement with a personally
related entity containing the following material conditions:
Management fees of $398,000 per annum payable by equal monthly instalments.
Payment of lease fees for a motor vehicle and parking.
Escalation of fees of 3% from 1 July 2019.
24
Bounty Oil & Gas NL Annual Report ‐ 2017
Bonuses at the discretion of the board of directors and there are no retirement or other fixed benefits.
The personally related entity is responsible for all statutory entitlements.
Services: To include non‐exclusive executive management, capital raising, communication, management
strategy, budgets, investment policy and all other duties normally incidental to the position of chief
executive officer.
Other than the directors and the chief executive officer, at the date of this Report all other personnel are permanent
or part time employees of the company and not classified as key management personnel.
Key Management Remuneration
Details of the remuneration of directors and the other key management personnel of the group (as defined in AASB
124 Related Party Disclosures) and the one highest paid executive of Bounty Oil & Gas N.L. are set out in the
following tables.
Key Management Remuneration
2017
Key Management Person
Short‐term Benefits
$
Cash, salary and
commissions
Consulting
Fees + Other
Cash bonus
and Non‐
cash
benefits (2)
Post‐
employment
Benefits
Super‐
annuation
Share based
payment
Total
Options
Non‐Executive Directors
Mr G. Reveleigh (1)
Mr C. Ross (1)
Mr R. Payne
Other Key Management
Personnel – Chief Executive
officer
Mr P.F. Kelso (1)
60,000
30,000
‐
‐
‐
‐
‐
‐
‐
‐
‐
20,000
398,000
52,212
17,868
‐
‐
‐
‐
‐
60,000
30,000
20,000
468,080
1.
2.
Paid to a personally related entity of the director/executive.
Compensation for the 2017 financial year as set out in this column included non‐cash benefits of $52,212.
Key Management Remuneration
2016
Key Management Person
Short‐term Benefits
$
Cash, salary and
commissions
Consulting
Fees + Other
Cash bonus
and Non‐
cash
benefits (4)
Non‐Executive Directors
Mr G. Reveleigh (3)
Mr C. Ross (3)
Mr R. Payne
Other Key Management
Personnel – Chief Executive
officer
Mr P.F. Kelso (3)
60,000
30,000
‐
‐
‐
‐
398,000
59,962
‐
‐
‐
‐
Post‐
employment
Benefits
Super‐
annuation
Share based
payment
Total
Options
‐
‐
20,000
‐
‐
‐
60,000
30,000
20,000
457,962
3.
4.
Paid to a personally related entity of the director/executive.
Compensation for the 2016 financial year as set out in this column included non‐cash benefits of $59,962.
25
Bounty Oil & Gas NL Annual Report ‐ 2017
No director or senior management person appointed during the above periods received a payment as part of his
consideration for agreeing to be appointed to that position.
Share–based payments
During the financial year ended 30 June 2017 no share‐based payments were made to Key Management Persons.
Fully paid ordinary shares
No fully paid ordinary shares were issued to Key Management Persons during the period.
Share Options
1. No share options were issued to directors or other key management persons or executives as part of their
remuneration during the year ended 30 June 2017 or since that date.
2. During the year, no directors or senior management held or exercised options that were granted to them as
part of their compensation in previous periods.
Loans to directors and executives
No loans were made to key management personnel including their personally related entities during the financial
year ended 30 June 2017 and no loans were outstanding at the end of the prior period, except that during the year,
the Group advanced sums totalling $104,107 to the Operator of joint operations in which the Group has petroleum
interests. The CEO Mr. P. Kelso is a director of the Operator. The advances were made in the ordinary course of
business to support the joint operation activities.
Other Key Management Personnel Disclosures:
Further information on disclosure in connection with Key Management Personnel and Share Base Payments are set
out in the following Notes to the Financial Statements:‐
1.
2.
3.
Note 19: Share Based Payments
Note 20: Key Management Personnel Disclosures
Note 22: Related Party Transactions.
Performance income as a proportion of total remuneration
The percentage of remuneration paid to directors and key management personnel during the financial year ended
30 June 2017 which was performance based was: Nil.
Employee Share Scheme
Bounty Oil & Gas N.L. has a current Employee Share Plan (the Plan) approved by shareholders.
Under the Plan all share issues to directors or other Key Management Personnel must receive prior shareholder
approval.
No ordinary shares of the company were issued under the Plan during the year ending 30 June 2017.
26
Bounty Oil & Gas NL
Annual Report – 2017
Consolidated statement of profit and loss and other comprehensive income
for the year ended 30 June 2017
Petroleum revenue
Net Investment (loss)/income
Other income
Direct petroleum operating expense
Changes in inventories
Employee benefits and contractor expense
Depreciation expense
Amortisation of oil producing assets
Occupancy expense
Corporate activity costs
Rehabilitation expense
Impairment of oil and gas assets
Exploration expenses write off
General legal and professional costs
Other expenses
Loss before Tax
Income tax expense
Loss for the period from continuing operations
Loss for the year
Other comprehensive income for the year, net of income tax
Total Comprehensive loss for the period
Total comprehensive income/(loss) attributable to owners of
the parent
Earnings/(loss) per share
Basic (cents per share)
Diluted (cents per share)
Year-ended
Notes
30-Jun-17
$
30-Jun-16
$
5
5
5
5
6
13/14
2,677,801
8,775
(7,201)
(634,119)
(122)
(781,870)
(47,411)
(439,242)
(100,826)
(82,143)
(25,816)
(834,259)
(10,263)
(58,133)
(52,959)
1,077,497
(69,245)
285,360
(1,104,439)
9,385
(820,309)
(88,457)
(340,320)
(134,303)
(67,922)
(37,110)
(2,949,269)
(48,883)
(97,009)
(42,176)
(387,788)
(4,427,200)
7
-
-
(387,788)
(4,427,200)
(387,788)
(4,427,200)
-
-
(387,788)
(4,427,200)
(387,788)
(4,427,200)
(0.04)
(0.04)
(0.47)
(0.47)
The above consolidated statement of comprehensive income should to be read in conjunction with the
accompanying notes.
28
Bounty Oil & Gas NL
Annual Report – 2017
Consolidated statement of financial position
as at 30 June 2017
Assets
Current assets
Cash and cash equivalents
Trade and other receivables
Inventories
Other current financial assets
Total current assets
Non-current assets
Trade receivables
Exploration and evaluation assets
Production and development assets
Property, plant and equipment
Total non-current assets
Total assets
Liabilities
Current liabilities
Trade and other payables
Provisions
Total current liabilities
Non-current liabilities
Unearned revenue
Provisions
Total non-current liabilities
Total liabilities
Net assets
Equity
Issued capital
Reserves
Retained losses
Equity attributable to owners of the parent
Total equity
Notes
30-Jun-17
$
30-Jun-16
$
9
10
11
12
10
14 (b)
14(a)
13
15
16
16
17
1,024,462
1,319,983
26,270
24,939
2,395,654
39,943
9,688,826
7,329,025
559,403
1,760,668
89,092
49,034
24,450
1,923,244
-
9,124,857
8,384,715
629,112
17,617,197
18,138,684
20,012,851
20,061,928
783,882
24,162
808,044
475,498
26,764
502,262
5,888
1,290,528
1,296,416
-
1,263,487
1,263,487
2,104,460
1,765,749
17,908,391
18,296,179
43,440,163
201,600
(25,733,372)
17,908,391
43,440,163
201,600
(25,345,584)
18,296,179
17,908,391
18,296,179
The above consolidated statement of financial position should to be read in conjunction with the
accompanying notes.
29
Bounty Oil & Gas NL
Annual Report – 2017
Consolidated statement of changes in equity
for the year ended 30 June 2017
Balance at 1 July 2015
(Loss) for the year
Other comprehensive income for the period
Total comprehensive income for the period
Shares issued during the period
Balance at 30 June 2016
Balance at 1 July 2016
Loss for the period
Other comprehensive income for the period
Total comprehensive income for the period
Shares issued during the period
Balance at 30 June 2017
Notes
Ordinary share
capital
$
43,440,163
-
-
-
-
43,440,163
43,440,163
-
-
-
-
43,440,163
17
17
Retained
earnings/
(Accumulated
losses)
$
(20,918,384)
(4,427,200)
-
Total
$
22,723,379
(4,427,200)
-
(4,427,200)
(4,427,200)
-
-
(25,345,584)
18,296,179
(25,345,584)
(387,788)
-
(387,788)
-
(25,733,372)
18,296,179
(387,788)
-
(387,788)
-
17,908,391
Option reserve
$
201,600
-
-
-
-
201,600
201,600
-
-
-
-
201,600
The above consolidated statement of changes in equity should to be read in conjunction with the accompanying notes.
30
Bounty Oil & Gas NL
Annual Report – 2017
Consolidated statement of cash flows
for the year ended 30 June 2017
Cash flows from operating activities
Receipts from petroleum operations
Proceeds from sale of listed shares
Payments for acquisition of listed shares
Payments to suppliers and employees
Interest and dividend received
Other
Year-ended
Notes
30-Jun-17
$
30-Jun-16
$
1,617,215
52,605
(44,319)
(2,002,886)
12,173
-
1,177,989
-
(5,344)
(1,883,301)
13,259
9,275
Net cash (used in) operating activities
18
(365,212)
(688,122)
Cash flows from investing activities
Payments for exploration and evaluation assets
Payments for oil production & development assets
Payments for property plant and equipment
Proceeds from disposal of other assets
Proceeds from disposal of oil production & development assets
Loans repayment/(advanced)
Net cash generated by/(used in) investing activities
Cash flows from financing activities
Proceeds from issue of shares
Net cash (used in) financing activities
(508,296)
244,030
(7,428)
-
-
(79,107)
(350,801)
(83,350)
(656,954)
-
1,320,000
340,000
13,000
932,696
-
-
-
-
Net increase/(decrease) in cash and cash equivalents
(716,013)
244,574
Cash and cash equivalents at the beginning of the period
Effects of exchange rate changes on the balance
of cash held in foreign currencies
Cash and cash equivalents at the end of the period
1,760,668
1,508,539
9
(20,193)
1,024,462
7,555
1,760,668
The above consolidated statement of cash flow should be read in conjunction with the accompanying
notes.
31
Bounty Oil & Gas NL
Annual Report – 2017
Contents of the notes to the consolidated financial statements
1. Statement of compliance
2. Summary of significant accounting policies
3. Critical accounting estimates and judgments
4. Segment Information
5. Revenue and other income
6. Employee benefit expense
7. Income tax expense
8. Earnings/(loss) per share
9. Cash and cash equivalents
10. Trade and other receivables
11. Inventories
12. Other current financial assets
13. Property, plant and equipment
14. Non current assets
15. Trade and other payables
16. Provisions
17. Issued capital
18. Reconciliation of cash flow from continuing operations
19. Share based payments
20. Key management personnel
21. Commitments
22. Related party transactions
23. Financial instruments
24 . Controlled entities
25. Interest in joint operations
27. Business combinations
26. Parent entity information
27. Contingent liabilities and contingent assets
28. Events occurring after the reporting period
29. Auditors remuneration
30. Company details
32
Bounty Oil & Gas NL
Annual Report – 2017
Notes to the consolidated financial statements
for the year ended 30 June 2017
1. Statement of compliance
Bounty Oil and Gas N.L. Is a company incorporated in Australia and limited by shares which are publicly traded on the Australian
Securities Exchange.
This financial report includes the consolidated financial statements and notes of Bounty Oil & Gas NL (“parent entity”) and
controlled entities (“consolidated group” or “group”) and the Group’s interest in jointly controlled assets for the financial year
ended 30 June 2017. Supplementary financial information about the parent entity is disclosed in Note 26. The Financial
Statements are presented in Australian currency.
The group is a for-profit entity for financial reporting purposes under Australian Accounting Standards.
The financial report was authorised for issue by the directors on 29 September 2017.
2. Summary of significant accounting policies
The financial report is a general purpose financial report that has been prepared in accordance with Australian Accounting
Standards, Australian Accounting Interpretations, other authoritative pronouncements of the Australian Accounting Standards
Board (AASB), the Corporations Act 2001 and comply with other requirements of the law.
Compliance with AASB 101 ensures compliance with International Financial Reporting Standard IAS 1 Presentation of Financial
Statements.
Australian Accounting Standards set out accounting policies that the AASB has concluded would result in a financial report
containing relevant and reliable information about transactions, events and conditions to which they apply. Compliance with
Australian Accounting Standards ensures that the financial statements and notes also comply with International Financial
Reporting Standards. Material accounting policies adopted in the preparation of this financial report are presented below.
They have been consistently applied unless otherwise stated.
a. Basis of preparation
The 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 are presented in Australian dollars, unless otherwise noted.
The following significant accounting policies have been adopted in the preparation and presentation of the financial
reports. These accounting policies are consistent with Australian Accounting Standards and with International Financial
Reporting Standards.
The company is a company of the kind referred to in ASIC Class Order 98/100, dated 10 July 1998, and in accordance with that
Class Order amounts in the financial report are rounded off to the nearest thousand dollars, unless otherwise indicated.
b. Application of new and revised accounting standards
The following standards and interpretations which became effective and were applied for the first time during the year ended
30 June 2017 were assessed to have no material impact on the Group:
The Group’s accounting policies are consistent with those of the previous financial year except for new policies adopted
from 1 July 2016 as follows:
AASB 2014-3 Amendments to Australian Accounting Standards – Accounting for Acquisitions of Interests in Joint Operations
(AASB 1 & AASB 11)
AASB 2014-4 Clarification of Acceptable Methods of Depreciation and Amortisation (Amendments to IAS 16 and IAS 38)
AASB 2015-1 Amendments to Australian Accounting Standards – Annual Improvements to Australian Accounting Standards
2012–2014 Cycle
AASB 2015-2 Amendments to Australian Accounting Standards – Disclosure Initiative: Amendments to AASB 101.
33
Bounty Oil & Gas NL
Annual Report – 2017
Notes to the consolidated financial statements
for the year ended 30 June 2017
b. Accounting standards and interpretations issued but not yet effective
At the date of authorisation of the financial statements, the Standards and Interpretations listed below were in issue but not
yet effective or early adopted by the Group.
AASB 15 Revenue from Contracts with Customers
AASB 9 Financial Instruments
AASB 16 Leases
AASB 2016-1 Amendments to Australian Accounting Standards – Recognition of Deferred Tax Assets for Unrealised Losses
(AASB 112)
AASB 2016-2 Amendments to Australian Accounting Standards – Disclosure Initiative: Amendments to AASB 107
AASB 2016-5 Classification and Measurement of Share-based Payment Transactions
AASB 2017-1 Amendments to Australian Accounting Standards – Transfers of Investments Property, Annual Improvements
2014-2016 Cycle and Other Amendments
AASB Interpretation 22 Foreign Currency Transactions and Advance Consideration
AASB 2017-2 Amendments to Australian Accounting Standards – Further Annual Improvements 2014-2016 Cycle
AASB Interpretation 23 Uncertainty over Income Tax Treatments
c. Basis of consolidation
(i) Controlled entities
The consolidated financial statements incorporate the assets, liabilities and results of entities controlled by Bounty Oil & Gas NL
at the end of the reporting period. A controlled entity is any entity over which Bounty Oil & Gas NL has the power to govern the
financial and operating policies so as to obtain benefits from the entity’s activities. Control will generally exist when the parent
owns, directly or indirectly through subsidiaries, more than half of the voting power of an entity. In assessing the power to
govern, the existence and effect of holdings of actual and potential voting rights are also considered.
Where controlled entities have entered or left the Group during the year, the financial performance of those entities are
included only for the period of the year that they were controlled. A list of controlled entities is contained in Note 24 to the
financial statements.
In preparing the consolidated financial statements all inter-group balances and transactions between entities in the
consolidated group have been eliminated on consolidation. Accounting policies of subsidiaries have been changed where
necessary to ensure consistency with those adopted by the parent entity.
For the reporting period the only controlled entities that Bounty Oil & Gas NL had were Ausam Resources Pty Limited (100%),
and Interstate Energy Pty Limited (100%).
34
Bounty Oil & Gas NL
Annual Report – 2017
Notes to the consolidated financial statements
for the year ended 30 June 2017
c. Basis of consolidation (continued)
(ii) Joint arrangements
Under AASB 11 'Joint Arrangements' investments in joint arrangements are classified as either joint operations or joint
ventures depending on the contractual rights and obligations each investor has, rather than the legal structure of the joint
arrangement. Bounty Oil & Gas NL has assessed the nature of its joint arrangements and determined them to be joint
operations.
Bounty Oil & Gas NL has recognised its share of jointly held assets, liabilities, revenues and expenses of
joint operations. These have been incorporated in the financial statements under the appropriate headings.
Details of the joint operations are set out in note 25.
(iii) Business combinations
Acquisitions of businesses are accounted for using the acquisition method. The consideration transferred in a business
combination is measured at fair value which is calculated as the sum of the acquisition-date fair values of assets transferred
by the Group, liabilities incurred by the Group to the former owners of the acquiree and the equity instruments issued by the
Group in exchange for control of the acquiree. Acquisition-related costs are recognised in profit or loss as incurred.
At the acquisition date, the identifiable assets acquired and the liabilities assumed are, with limited exceptions, recognised at
their fair value at the acquisition date.
d. Interests in joint operations
A joint operation is a joint arrangement whereby the parties that have joint control of the arrangement have rights to the
assets, and obligations for the liabilities, relating to the arrangement. Joint control is the contractually agreed sharing of
control of an arrangement, which exists only when decisions about the relevant activities require unanimous consent of the
parties sharing control.
When a group entity undertakes its activities under joint operations, the Group as a joint operator recognises in relation to its
interest in a joint operation:
• its assets, including its share of any assets held jointly;
• its liabilities, including its share of any liabilities incurred jointly;
• its share of the revenue from the sale of the output by the joint operation; and
• its expenses, including its share of any expenses incurred jointly.
The Group accounts for the assets, liabilities, revenues and expenses relating to its interest in a joint operation in accordance
with the AASBs applicable to the particular assets, liabilities, revenues and expenses. When a group entity transacts with a
joint operation in which a group entity is a joint operator (such as a sale or contribution of assets), the Group is considered to
be conducting the transaction with the other parties to the joint operation, and gains and losses resulting from the
transactions are recognised in the Group's consolidated financial statements only to the extent of other parties' interests in
the joint operation.
e. Income tax
The income tax expense / (income) for the year comprises current income tax expense / (income) and deferred tax expense
(income).
Current income tax expense charged to the profit or loss is the tax payable on taxable income calculated using applicable
income tax rates enacted, or substantially enacted, as at reporting date. Current tax liabilities (assets) are therefore measured
at the amounts expected to be paid to (recovered from) the relevant taxation authority.
Deferred income tax expense reflects movements in deferred tax asset and deferred tax liability balances during the year as
well unused tax losses.
Deferred tax assets and liabilities are ascertained based on temporary differences arising between the tax bases of assets and
liabilities and their carrying amounts in the financial statements. Deferred tax assets also result where amounts have been
fully expensed but future tax deductions are available. No deferred income tax will be recognised from the initial recognition
of an asset or liability, excluding a business combination, where there is no effect on accounting or taxable profit or loss.
Current and deferred income tax expense / (income) is charged or credited directly to equity instead of the profit or loss when
the tax relates to items that are credited or charged directly to equity.
35
Bounty Oil & Gas NL
Annual Report – 2017
Notes to the consolidated financial statements
for the year ended 30 June 2017
e. Income tax (continued)
Deferred tax assets and liabilities are calculated at the tax rates that are expected to apply to the period when the asset is
realised or the liability is settled, based on tax rates enacted or substantively enacted at reporting date. Their measurement
also reflects the manner in which management expects to recover or settle the carrying amount of the related asset or
liability.
Deferred tax assets relating to temporary differences and unused tax losses are recognised only to the extent that it is
probable that future taxable profit will be available against which the benefits of deferred tax asset can be utilised.
Where temporary differences exist in relation to investments in subsidiaries, branches, associates, and joint ventures,
deferred tax assets and liabilities are not recognised where the timing of the reversal of the temporary difference can be
controlled and it is not probable that the reversal will occur in the foreseeable future.
Current tax assets and liabilities are offset where a legally enforceable right of set-off exists and it is intended that net
settlement or simultaneous realisation and settlement of the respective asset and liability will occur. Deferred tax assets and
liabilities are offset where a legally enforceable right of set-off exists, the deferred tax assets and liabilities relate to income
taxes levied by the same taxation authority on either the same taxable entity or different taxable entities where it is intended
that net settlement or simultaneous realisation and settlement of the respective asset and liability will occur in future periods
in which significant amounts of deferred tax assets or liabilities are expected to be recovered or settled.
Tax Consolidation - Bounty Oil & Gas NL and its wholly owned Australian subsidiary have not formed an income tax
consolidation group under tax consolidation legislation. Each entity in the Group recognises its own current and deferred tax
assets and liabilities. Such taxes are measured using the ‘stand alone taxpayer’ approach to allocation.
f. Going concern basis
The directors have prepared the financial report on a going concern basis, which contemplates the continuity of normal
business activities and the realisation of assets and the settlement of liabilities in the ordinary course of business.
For the period ended 30 June 2017, the Group realised a net loss after tax of $387,788 (2016: $4,427,200). This was largely as
a result of non-cash impairment of production assets. The net cash utilised by operating activities for the period ended 30
June 2017 was $365,212 (2016: net cash utilised $688,122). The Group’s net asset position at 30 June 2017 was $17,908,391
(30 June 2016: $18,296,179) and its cash balance amounted to $1,024,462 (30 June 2016: $1,760,668).
The directors’ cash flow forecasts project that the group will continue to be able to meet its liabilities and obligations
(including those exploration commitments as disclosed in Note 21) as and when they fall due for a period of at least 12
months from the date of signing of this financial report. The cash flow forecasts are dependent upon the generation of
sufficient cash flows from operating activities to meet working capital requirements, the ability of the group to manage
discretionary exploration and evaluation expenditure on non-core assets via farmout or disposal of certain interests and or a
reduction in its future work programmes. The directors are of the opinion that the use of the going concern basis of
accounting is appropriate as they are satisfied as to the ability of group to implement the above.
g. Fair value measurement
AASB 13 establishes a single source of guidance for determining the fair value of assets and liabilites. AASB 13 does not
change when an entity is required to use fair value, but rather, provides guidance on how to determine fair value when fair
value is required or permitted. Application of this definition may result in different fair values being determined for the
relevant assets. AASB 13 also expands the disclosure requirements for all assets and liabilites carried at fair value. This
includes information about the assumptions made and the qualitative impact of those assumptions on the fair value
determined. Consequential amendmends were also made to other standards.
AASB 13 requires the disclosure of fair value information by level of the fair value hierarchy, which categorises fair value
measurements into one of three possible levels based on the lowest level that a significant input to the measurement can be
categorised into as follows:
- level 1: Measurement based on quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity
can access at the measurement date.
-level 2: Measurements based on inputs other than quoted prices included in level 1 that are observable for the asset or
liability, either directly or indirectly.
-level 3: Measurements based on unobservable inputs for the asset or liability.
The carrying values of financial assets and liabilites recorded in the financial statements approximates their respective fair
values, determined in accordance with the acounting policies described above and adjusted for capitalised transaction costs, if
any.
36
Bounty Oil & Gas NL
Annual Report – 2017
Notes to the consolidated financial statements
for the year ended 30 June 2017
h. Trade and other receivables
Trade receivables are recognised initially at fair value and subsequently measured at amortised cost, less provision for
doubtful debts. Trade receivables are due for settlement no more than 120 days from the date of recognition for land
development and resale debtors, and no more than 30 days for other debtors.
Collection of trade receivables is reviewed on an ongoing basis. Debts, which are known to be uncollectible, are written off. A
provision for doubtful receivables is established when there is objective evidence that the Group will not be able to collect all
amounts due according to the original terms of receivables. The amount of the provision is the difference between the asset’s
carrying amount and the present value of estimated future cash flows, discounted at the original effective interest rate. Cash
flows relating to short-term receivables are not discounted if the effect of discounting is immaterial. The amount for the
provision is recognised in the income statement.
i. Property, plant and equipment
Each class of property, plant and equipment is carried at cost or fair value as indicated less, where applicable, any
accumulated depreciation and impairment losses.
Freehold land and building are shown at their fair value (being the amount for which an asset could be exchanged between
knowledgeable willing parties in an arm’s length transaction), based on periodic, but at least triennial, valuations by external
independent valuers, less subsequent depreciation for buildings.
Increases in the carrying amount arising on revaluation of land and buildings are credited to a revaluation surplus in equity.
Decreases that offset previous increases of the same asset are charged against fair value reserves directly in equity; all other
decreases are charged to the statement or comprehensive income. Each year the difference between depreciation based on
the re-valued carrying amount of the asset charged to the statement of comprehensive income and depreciation based on the
assets original cost is transferred from the revaluation surplus to retained earnings.
Any accumulated depreciation at the date of revaluation is eliminated against the gross carrying amount of the asset and the
net amount is restated to the revalued amount of the asset.
Plant and equipment are measured on the cost basis.
The carrying amount of plant and equipment is reviewed annually by directors to ensure it is not in excess of the recoverable
amount from these assets. The recoverable amount is assessed on the basis of the expected net cash flows that will be
received from the asset’s employment and subsequent disposal.
The cost of fixed assets constructed within the consolidated group includes the cost of materials, direct labour, borrowing
costs and an appropriate proportion of fixed and variable overheads.
Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is
probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be
measured reliably. All other repairs and maintenance are charged to the income statement during the financial period in
which they are incurred.
j. Depreciation
The depreciable amount of all fixed assets including buildings and capitalised lease assets, but excluding freehold land, is
depreciated on a straight-line basis over the asset’s useful life to the Group from the time the asset is held ready for use.
Leasehold improvements are depreciated over the shorter of either the unexpired period of the lease or the estimated useful
lives of the improvements.
Depreciation on assets is calculated over their estimated useful life as follows:
Class of fixed asset
Office furniture and fittings
Computer equipment
Plant and equipment
Estimated useful life
5 years
4 years
5 years
The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at each balance sheet date.
An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater
than its estimated recoverable amount.
37
Bounty Oil & Gas NL
Annual Report – 2017
Notes to the consolidated financial statements
for the year ended 30 June 2017
j. Depreciation (continued)
Gains and losses on disposals are determined by comparing proceeds with the carrying amount. These gains and losses are
included in the income statement. When re-valued assets are sold, amounts included in the revaluation reserve relating to
that asset are transferred to retained earnings.
k. Exploration and evaluation expenditure
Exploration and evaluation expenditures in relation to each separate area of interest are recognised as an exploration and
evaluation asset in the year in which they are incurred where the following conditions are satisfied:
• the rights to tenure of the area of interest are current; and,
• at least one of the following conditions is also met:
i) the exploration and evaluation expenditures are expected to be recouped through successful exploration, development and
commercial exploitation of the area of interest, or alternatively, by its sale; or,
ii) exploration and evaluation activities in the area of interest have not, at the reporting date, reached a stage which permits a
reasonable assessment of the existence or otherwise of economically recoverable petroleum reserves or resources and active
and significant operations in, or in relation to, the area of interest are continuing.
Exploration and evaluation assets are initially measured at cost and include acquisition of rights to explore, geophysical
surveys, studies, exploratory drilling, sampling and associated activities and an allocation of depreciation and amortisation of
assets used in exploration and evaluation activities. General and administrative costs are only included in the measurement
of exploration and evaluation costs where they are related directly to operational activities in a particular area of interest.
Exploration and evaluation assets are assessed for impairment when facts and circumstances suggest that the carrying
amount of an exploration and evaluation asset may exceed its recoverable amount. The recoverable amount of the
exploration and evaluation asset (or the cash-generating unit(s) to which it has been allocated, being no larger than the
relevant area of interest) is estimated to determine the extent of the impairment loss (if any). Where an impairment loss
subsequently reverses, the carrying amount of the asset is increased to the revised estimate of its recoverable amount, but
only to the extent that the increased carrying amount does not exceed the carrying amount that would have been determined
had no impairment loss been recognised for the asset in previous years. Where a decision is made to proceed with
development in respect of a particular area of interest, the relevant exploration and evaluation asset is tested for impairment
and the balance is then re-classified to development.
l. Production and development assets
The group follows the full cost method of accounting for production and development assets whereby all costs, less any
incentives related to the acquisition, exploration and development of oil and gas reserves are capitalised. These costs include
land acquisition costs, geological and geophysical expenses, the costs of drilling both productive and non productive wells,
non producing lease rentals and directly related general and administrative expenses. Proceeds received from the disposal of
properties are normally credited against accumulated costs.
When a significant portion of the properties is sold, a gain or loss is recorded and reflected in profit or loss.
With respect to production assets, depletion of production and development assets and amortisation of production facilities
and equipment are calculated using the unit of production method based on estimated proven oil and gas reserves. For the
purposes of depletion calculation proved oil and gas reserves before royalties are converted to a common unit measure.
The estimated costs for developing proved underdeveloped reserves, future decommissioning and abandonments, net of
estimated salvage values, are provided for on the unit of production method included in the provision for depletion and
amortisation.
In applying the full cost method of accounting, the capitalised costs less accumulated depletion are restricted from exceeding
an amount equal to the estimated discounted future net revenues, based on year end prices and costs, less the aggregate
estimate future operating and capital costs derived from proven and probable reserves.
Development expenditure is recognised at cost less accumulated amortisation and any impairment losses. Where commercial
production in an area of interest has commenced, the associated costs together with any forecast future capital expenditure
necessary to develop proved and probable reserves are amortised over the estimated economic life of the field on a units-of-
production basis.
Changes in factors such as estimates of proved and probable reserves that affect unit of production calculations are dealt with
on a prospective basis.
38
Bounty Oil & Gas NL
Annual Report – 2017
Notes to the consolidated financial statements
for the year ended 30 June 2017
m. Trade and other payables
These amounts represent liabilities for goods and services provided to the Group prior to the end of the financial year, which
are unpaid. The amounts are unsecured and are usually paid within 30 days of recognition.
n. Inventories
Inventories are measured at the lower of cost and net realisable value. The cost of petroleum products includes direct
materials, direct labour and an appropriate portion of variable and fixed overheads.
o. Leased assets
Leases of fixed assets where substantially all the risks and benefits incidental to the ownership of the asset, but not the legal
ownership that is transferred to entities in the Group, are classified as finance leases.
Finance leases are capitalised by recording an asset and a liability at the lower of the amounts equal to the fair value of the
leased property or the present value of the minimum lease payments, including any guaranteed residual values. Lease
Leased assets are depreciated on a straight-line basis over the shorter of their estimated useful lives or the lease term.
p. Financial instruments
Recognition and Initial Measurement
Financial instruments, incorporating financial assets and financial liabilities, are recognised when the entity becomes a party
to the contractual provisions of the instrument. Trade date accounting is adopted for financial assets that are delivered
within timeframes established by marketplace convention.
Financial instruments are initially measured at fair value plus transaction costs where the instrument is not classified as at fair
value through profit or loss. Transaction costs related to instruments classified as at fair value through profit or loss are
expensed to profit or loss immediately. Financial instruments are classified and measured as set out below.
De-recognition
Financial assets are derecognised where the contractual rights to receipt of cash flows expires or the asset is transferred to
another party whereby the entity no longer has any significant continuing involvement in the risks and benefits associated
with the asset. Financial liabilities are de-recognised where the related obligations are either discharged, cancelled or expire.
The difference between the carrying value of the financial liability extinguished or transferred to another party and the fair
value of consideration paid, including the transfer of non-cash assets or liabilities assumed, is recognised in profit or loss.
Classification and subsequent measurement
i) Financial assets at fair value through profit or loss
Financial assets are classified at fair value through profit or loss when they are held for trading for the purpose of short term
profit taking, where they are derivatives not held for hedging purposes, or designated as such to avoid an accounting
mismatch or to enable performance evaluation where a company of financial assets is managed by key management
personnel on a fair value basis in accordance with a documented risk management or investment strategy. Realised and
unrealised gains and losses arising from changes in fair value are included in profit or loss in the period in which they arise.
ii) Loans and receivables
Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active
market and are subsequently measured at amortised cost using the effective interest rate method.
iii) Held-to-maturity investments
Held-to-maturity investments are non-derivative financial assets that have fixed maturities and fixed or determinable
payments, and it is the Group’s intention to hold these investments to maturity. They are subsequently measured at
amortised cost using the effective interest rate method.
iv) Available-for-sale financial assets
Available-for-sale financial assets are non-derivative financial assets that are either designated as such or that are not
classified in any of the other categories. They comprise investments in the equity of other entities where there is neither a
fixed maturity nor fixed or determinable payments.
v) Financial liabilities
Non-derivative financial liabilities (excluding financial guarantees) are subsequently measured at amortised cost using the
effective interest rate method.
39
Bounty Oil & Gas NL
Annual Report – 2017
Notes to the consolidated financial statements
for the year ended 30 June 2017
q. Impairment of assets
Other assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount
may not be recoverable.
An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. The
recoverable amount is the higher of an asset’s fair value less costs to sell and value in use. For the purpose of assessing
impairment, assets are grouped at the lowest levels for which there are separately identifiable cash inflows which are largely
independent of the cash inflows from other assets or groups of assets (cash-generating units). Non-financial assets other than
goodwill that suffered impairment are reviewed for possible reversal of the impairment at each reporting date.
r. Foreign currency transactions and balances
Functional and presentation currency
The functional currency is measured using the currency of the primary economic environment in which the Group operates
(the “functional” currency). The financial statements are presented in Australian dollars which is the Group’s functional and
presentation currency.
Transactions and balances
Foreign currency transactions are translated into functional currency using the exchange rates prevailing at the date of the
transaction. Foreign currency monetary items are translated at the year-end exchange rate. Non-monetary items measured
at historical cost continue to be carried at the exchange rate at the date of the transaction. Non-monetary items measured at
fair value are reported at the exchange rate at the date when fair values were determined.
Exchange differences arising on the translation of monetary items are recognised in the income statement, except where
deferred in equity as a qualifying cash flow or net investment hedge.
Exchange differences arising on the translation of non-monetary items are recognised directly in equity to the extent that the
gain or loss is directly recognised in equity, otherwise the exchange difference is recognised in the income statement.
s. Employee benefits
Wages and salaries, annual leave
Provision is made for the Group’s liability for employee benefits arising from services rendered by employees to balance date.
Employee benefits that are expected to be settled within one year have been measured at the amounts expected to be paid
when the liability is settled. Employee benefits payable later than one year have been measured at the present value of the
estimated future cash outflows to be made for those benefits. Those cash flows are discounted using market yields on
national government bonds with terms to maturity that match the expected timing of cash flows.
Share based payments – employee share plan
Share based compensation has from time to time been provided to eligible persons via the Bounty Oil & Gas N.L. Employee
Share Plan (“Plan”). Under AASB 2 “Share-based Payments”, the Employee Share Plan shares are deemed to be equity-settled
share-based remuneration.
Equity-settled share-based payments with employees and others providing similar services are measured at the fair value of
the equity instrument at the grant date. Fair value is measured by use of the quoted market price or binomial pricing model.
The fair value determined at the grant date of the equity-settled share-based payments is expensed on a straight-line basis
over the vesting period, based on the Group’s estimate of equity instruments that will eventually vest, with a corresponding
increase in equity.
t. Provisions
Provisions are recognised when the Group has a legal or constructive obligation, as a result of past events, for which it is
probable that an outflow of economic benefits will result and that outflow can be reliably measured. Provisions are
determined by discounting the expected future cash flows at a pre-tax discount rate that reflects current market assessments
of the time value of money and, where appropriate, the risks specific to the liability.
u. Cash and cash equivalents
Cash and cash equivalents include cash on hand, deposits held at call with banks, other short-term highly liquid investments
with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within short-term
borrowings in current liabilities on the balance sheet.
40
Bounty Oil & Gas NL
Annual Report – 2017
Notes to the consolidated financial statements
for the year ended 30 June 2017
v. Rehabilitation obligations
Provisions for future environmental restoration are recognised where there is a present obligation as a result of exploration,
development, production or storage activities having been undertaken and it is probable that an outflow of economic benefits
will be required to settle the obligation. The estimated future obligations include the costs of removing facilities, abandoning
wells and restoring the affected areas.
The provision for future restoration costs is the best estimate of the present value of the expenditure required to settle the
restoration obligation at the reporting date. Future restoration costs are reviewed annually and any changes in the estimate
are reflected in the present value of the restoration provision at reporting date, with a corresponding charge in the cost of the
associated asset.
The amount of the provision for future restoration costs relating to exploration, development and production facilities is
capitalised and depleted as a component of the cost of those activities.
The unwinding of the effect of discounting on the provision is recognised as a finance cost.
w. Revenue and other income
Revenue is measured at the fair value of the consideration received or receivable after taking into account any trade discounts
and volume rebates allowed. Any consideration deferred is treated as the provision of finance and is discounted at a rate of
interest that is generally accepted in the market for similar arrangements. The difference between the amount initially
recognised and the amount ultimately received is interest revenue.
Revenue from the sale of goods is recognised at the point of delivery as this corresponds to the transfer of significant risks and
rewards of ownership of the goods and the cessation of all involvement in those goods.
Interest revenue is recognised using the effective interest rate method, which, for floating rate financial assets, is the rate
inherent in the instrument. Dividend revenue is recognised when the right to receive a dividend has been established.
All revenue is stated net of the amount of goods and services tax (GST).
x. Goods and services tax (GST)
Revenues, expenses and assets are recognised net of the amount of GST, except where the amount of GST incurred is not
recoverable from the Australian Tax Office. In these circumstances the GST is recognised as part of the cost of acquisition of
the asset or as part of an item of the expense. Receivables and payables in the balance sheet are shown inclusive of GST.
Cash flows are presented in the cash flow statement on a gross basis, except for the GST component of investing and financing
activities, which are disclosed as operating cash flows.
y. Earnings per share
i) Basic earnings per share
Basic earnings per share is calculated by dividing the profit/(loss) attributable to equity holders of the Group, excluding any
costs of servicing equity other than ordinary shares, by the weighted average number of ordinary shares outstanding during
the financial year, adjusted for bonus elements in ordinary shares issued during the year.
ii) Diluted earnings per share
Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into account the
after income tax effect of interest and other financing costs associated with dilutive potential ordinary shares and the
weighted average number of shares assumed to have been issued for no consideration in relation to dilutive potential
z. Comparative figures
When required by Accounting Standards, comparative figures have been adjusted to conform to changes in presentation for
the current financial year.
aa. Contributed equity
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are
shown in equity as a deduction from the proceeds.
41
Bounty Oil & Gas NL
Annual Report – 2017
Notes to the consolidated financial statements
for the year ended 30 June 2017
3. Critical accounting estimates and judgments
In the application of the group’s accounting policies, which are described in Note 1, the directors are required to make
judgments, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from
other sources. The estimates and associated assumptions are based on historical and industry experience and other factors
that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are
recognised in the period in which the estimate is revised if the revision affects only that period or in the period of the revision
and future periods if the revision affects both current and future periods.
The following are the critical judgments that management has made in the process of applying the group’s accounting policies
and that have the most significant effect on the amounts recognised in the financial statements:
Exploration and evaluation assets
The group’s policy is discussed in Note 2(k) & (l). Its policy for production and development assets is discussed in Note 1(n).
The application of these policies requires management to make certain estimates and assumptions as to future events and
circumstances. Any such estimates and assumptions may change as new information becomes available. If after having
capitalised exploration and evaluation expenditure, management concludes that the capitalised expenditure is unlikely to be
recovered by future sale or exploitation, then the relevant capitalised amount will be written off through profit or loss.
Estimate of reserve quantities
The estimated quantities of proven and probably hydrocarbon reserves and resources reported by the group are integral to
the calculation of amortisation (depletion) and depreciation expense and to assessments of possible impairment of assets.
Estimated reserve quantities are based upon data from exploration and development drilling, interpretations of geological
and geophysical models and assessment of the technical feasibility and commercial viability of producing the reserves.
Management prepares reserve estimates which conform to guidelines prepared by the Society of Petroleum Engineers, USA.
Where appropriate these estimates are then verified by independent technical experts.
These assessments require assumptions to be made regarding future development and production costs, commodity prices,
exchange rates and fiscal regimes. The estimates of reserves may change from period to period as the economic assumptions
used to estimate the reserves can change from period to period, and as additional geological or reservoir data is generated
during the course of operations.
Provision for rehabilitation and decommissioning
The group estimates the future removal and decommissioning costs of oil and gas production facilities, wells, pipelines and
related assets at the time of installation of the assets. In most instances the removal of these assets will occur many years in
the future. The estimates of future removal costs therefore requires management to make adjustments regarding the
removal date, future environmental legislation, the extent of decommissioning activities and future removal technologies.
Impairment of production and development assets
The group assesses whether oil and gas assets are tested for impairment on a semi-annual basis. This requires an estimation
of the recoverable amount from the cash generating unit to which each asset belongs. The recoverable amount is assessed on
the basis of the expected net cash flows that will be received from the asset’s employment and or subsequent disposal. The
expected net cash flows are discounted to their present values in determining the recoverable amount.
During the year, the group carried out semi annual reviews of its petroleum production, development and exploration
properties. The reviews led to the recognition of an impairment loss of $0.83 million in relation to ATP 1189 Naccowlah joint
operations, which has been recognised in profit or loss. These properties are reported as in the core oil and gas segment.
42
Bounty Oil & Gas NL
Annual Report – 2017
Notes to the consolidated financial statements
for the year ended 30 June 2017
4. Segment Information
Identification of Reportable Segments
Information reported to the Chief Operating Decision Maker, being the CEO, for the purposes of resource allocation and
assessment of the performance is more specifically focused on the category of business units. The Group’s reportable
segments under AASB 8 Operating Segments are therefore as follows:
Core Petroleum Segment - Oil and gas exploration, development and production
Secondary Segment - Investment in listed shares and securities.
Segment revenue and results
Core Oil & Gas Segment
Production projects
Development projects
Exploration projects
Secondary Segment
Listed securities
Total from continuing operations
Other revenue
Central admin costs and directors remuneration
Loss before tax
Segment revenue
Segment profit/(loss)
30-Jun-17
$
30-Jun-16
$
2,677,801
1,077,497
-
-
-
-
30-Jun-17
$
735,253
-
(10,263)
30-Jun-16
$
(3,404,602)
-
(48,883)
8,775
2,686,576
(69,245)
1,008,252
8,775
733,765
(7,201)
(1,114,352)
(387,788)
(69,245)
(3,522,730)
285,360
(1,189,830)
(4,427,200)
Segment revenue
Revenue reported above represents revenue/income generated from external sources. There were no intersegment sales
during the period (2016: nil).
Accounting policies of reportable segments
The accounting policies of the reportable segments are the same as the group’s accounting policies described in Note 1.
Segment profit/(loss) in this Note represents the profit/(loss) earned by each segment without allocation of central
administration costs and directors remuneration, other investment revenue such as interest earned, finance costs and
income tax expense. This is the measure reported to the Chief Operating Decision Maker for the purpose of resource
allocation and assessment of segment performance.
Information about major customers
Included in the revenue arising from direct sales of oil and gas of $2,677,801 (2016: $1,077,497) are revenues of
approximately $2,031,018 (2016: $549,307) which arose from sales to the Group’s largest customer. The revenue from the
Group’s second largest customer was approximately $430,110 (2016: $233,598). No other single customer contributed 10% or
more to the Groups revenue for both 2017 and 2016.
Other segment information
Core Oil & Gas Segment
Production projects
Development projects
Exploration projects
Other
Total
Core Oil & Gas Segment
Production projects
Development projects
Exploration projects
Total
Amortisation, depreciation
& depletion
Additions to non-current
assets
30-Jun-17
$
479,074
-
-
7,579
486,653
30-Jun-16
$
414,785
-
-
30-Jun-17
$
722,626
78,057
117,621
13,992
428,777
7,427
925,731
30-Jun-16
$
376,247
377,564
69,466
-
823,277
Impairment losses
(expenses)
30-Jun-17
$
834,259
-
10,263
844,522
30-Jun-16
$
2,949,269
-
48,883
2,998,152
43
Bounty Oil & Gas NL
Annual Report – 2017
Notes to the consolidated financial statements
for the year ended 30 June 2017
4. Segment Information (continued)
Segment assets are measured in the same way as in the financial statements. These assets are allocated based on the
operations of the segment and the physical location of the asset.
Segment liabilities are allocated to segments where there is a direct nexus between the incurrence of the liability and the
operations of the segment. Segment liabilites incude trade and other payables and provisions.
The unallocated items include items that are not considered part of the core operations of any segment.
Core Oil & Gas Segment
Production projects
Development projects
Exploration projects
Secondary Segment
Listed securities
Unallocated
Total
Segment assets
Segment liabilities
30-Jun-17
$
6,782,937
1,098,146
9,688,826
30-Jun-16
$
7,364,626
1,020,089
9,124,857
30-Jun-17
$
1,842,602
8,734
23,796
30-Jun-16
$
1,431,794
8,734
23,796
24,939
2,418,003
20,012,851
24,450
2,527,906
20,061,928
-
229,328
2,104,460
-
301,425
1,765,749
Geographical Segment information
The following table details the group’s geographical segment reporting of revenue and carrying amount of assets in each
geographical region where operations are conducted.
Revenue
Carrying amounts of non
current assets
30-Jun-17
$
648,356
2,031,018
2,679,375
30-Jun-16
$
1,275,738
17,874
1,293,612
30-Jun-17
$
13,514,153
4,103,044
17,617,197
30-Jun-16
$
13,918,791
4,219,893
18,138,684
30-Jun-17
$
2,655,056
22,745
2,677,801
30-Jun-16
$
1,046,307
31,190
1,077,497
14,396
(5,621)
8,775
-
(69,245)
(69,245)
12,985
(20,193)
7
(7,201)
13,259
7,555
264,546
285,360
2,679,375
1,293,612
Australia
Tanzania
Total
5. Revenue and other income
Sales revenue:
Oil and gas sales
Revenue from tariffs
Total sales revenue
Investment income:
Investment income from financial assets at fair value through
Profit and loss (held for trading listed shares)
Realised gain
Unrealised gain/(loss)
Total investment income
Other income:
Interest received
Gains/(losses) on foreign currency
Other income
Total other revenue
Total revenue
44
Bounty Oil & Gas NL
Annual Report – 2017
Notes to the consolidated financial statements
for the year ended 30 June 2017
6. Employee benefit expense
Directors fees
Consultancy fees - Internal
Wages & salaries
Other employee benefit expenses
Total Employee benefit expense
30-Jun-17
$
110,000
398,000
218,389
55,481
781,870
30-Jun-16
$
110,000
398,000
222,219
90,090
820,309
Recharge and recoveries
The Group has the policy to allocate a portion of employee benefit expense to production, development, exploration and
evaluation assets based on employee time committed to various projects.
7. Income tax expense
The prima facie tax on profit from ordinary activities before income tax is
reconciled to the income tax as follows:
Prima facie tax payable on profit/(income tax benefit) from continuing
operations before income tax at 30% (2016: 30%)
Consolidated group
Add: tax effect of non deductible expenses
Less: tax effect of expenditure claimed as deduction
Tax effect of Unused tax losses not recognised as deferred tax asset
Income tax expense attributable to loss from ordinary activities
$
(116,337)
303,801
(169,396)
$
(1,325,475)
1,056,376
(57,411)
18,068
(326,510)
-
-
The potential future income tax benefit arising from tax losses and timing differences has not been recognised as an asset
because recovery of tax losses is not probable and recovery of timing differences is not assured beyond reasonable doubt.
The potential future income tax benefit will be obtained if:
1) the relevant company derives future assessable income of a nature and an amount sufficient to enable the benefit to be
realised, or the benefit can be realised by another company in the Group in accordance with Division 170 of the Income Tax
Assessment Act 1997;
2) the relevant company and/or group continues to comply with the conditions for deductibility imposed by the Act; and
3) no changes in tax legislation adversely affect the Company and/or the group in realizing the benefit.
Bounty Oil and Gas NL and its wholly-owned subsidiaries have not formed a tax consolidation group.
8. Earnings/(loss) per share
Basic earnings/(loss) per share (cents per share)
Diluted earnings/(loss) per share (cents per share)
(0.04)
(0.04)
(0.47)
(0.47)
Net (loss)/profit used in the calculation of basic and diluted earnings/(loss) per share
(387,788)
(4,427,200)
Weighted average number of ordinary shares for the purposes
of basic and diluted EPS
9. Cash and cash equivalents
Deposits on call
Cash at bank
Total Cash and cash equivalents
No. of Shares No. of Shares
953,400,982
953,400,982
$
126,981
897,481
1,024,462
$
75,413
1,685,255
1,760,668
45
Bounty Oil & Gas NL
Annual Report – 2017
Notes to the consolidated financial statements
for the year ended 30 June 2017
10. Trade and other receivables
Current
Trade receivables
Prepayments
Other receivables
GST receivable
Loans to third party
Non-current
Trade receivables
Total trade and other receivables
30-Jun-17
$
1,208,775
2,686
105,376
3,146
-
30-Jun-16
$
60,130
3,512
450
-
25,000
39,943
1,359,926
-
89,092
The average credit period on sale of goods is 30 days. The Group generally recognise an allowance for doubtful debts for
receivables if management forms an opinion that receivable may not be recoverable. The balance outstanding at 30 June
2017 is primarily in relation to gas sales made to the largest customer during the financial year, the majority of which has
been received subsequent to year end. All other trade receivables were outstanding for an average period of 15 days as at 30
June 2017.
Ageing of past due but not impaired
60 – 90 days
90-120 days
120+ days
Total
$
372,681
57,302
119,783
549,765
$
-
-
-
-
In determining the recoverability of a trade receivable, the Group considers any change in the credit quality of the trade
receivable from the date credit was initially granted up to the end of the reporting period.
11. Inventories
Oil in inventory
Other inventory
12. Other current financial assets
Financial assets at fair value through profit and loss - shares in
listed corporations
Total current financial assets
Note
23(d)
13. Property, plant and equipment
Plant and Equipment
Plant and equipment – at cost
Less accumulated depreciation
Total Property, plant and equipment
Movement in carrying amounts:
Movements in the carrying amounts for each class of property, plant and
equipment between the beginning and end of the financial year.
Opening Balance
Additions
Impairment of production assets
Reclassification to receivables
Disposal
Depreciation
Carrying amount at the end of the year
46
$
26,270
-
26,270
$
40,243
8,791
49,034
$
$
24,939
24,939
24,450
24,450
$
776,996
(217,593)
$
811,921
(182,809)
559,403
629,112
$
$
629,112
56,346
-
(78,644)
-
(47,411)
559,403
1,676,758
115,186
(89,983)
-
(984,392)
(88,457)
629,112
Bounty Oil & Gas NL
Annual Report – 2017
Notes to the consolidated financial statements
for the year ended 30 June 2017
14. Non current assets
(a): Production and development assets
SW Queensland
Joint operation interest in ATP1189 Naccowlah Block – at cost
Less: Amortisation
Less: Impairment
Note
25
East Queensland
PL119 Downlands – at cost
Less: Depletion and amortisation
Nyuni Block, Tanzania- Kiliwani North
Joint operation interest in Nyuni Block - Kiliwani North at cost
Less: Amortisation
25
Rehabilitation costs – all petroleum properties
All other development assets
Total production and development assets
30-Jun-17
30-Jun-16
$
$
3,123,441
(565,000)
(834,259)
3,025,444
(400,000)
-
3,818,960
(2,518,609)
3,785,404
(2,518,609)
2,635,813
(200,000)
2,624,512
-
770,533
847,875
1,098,146
7,329,025
1,020,089
8,384,715
Movement in carrying amounts of production & development assets:
$
$
Opening balance at the beginning of the year
Additions
Movement in rehabilitation
Reclassification from exploration asset
Reclassification to exploration asset of ATP1189 Naccowlah costs
Disposal of PL 214 Utopia
Impairment of production and development assets (i)
Amortisation of production assets
Carrying amount at the end of the year
8,384,715
751,764
(77,342)
-
(456,611)
-
(834,259)
(439,242)
7,329,025
12,011,882
261,061
(463,022)
114,400
-
(340,000)
(2,859,286)
(340,320)
8,384,715
(i) In accordance with the Group's accounting policies and procedures, the Group performs its impairment testing at the end
of each reporting period. A number of factors presented indicators of impairment for the ATP 1189 Naccowlah JV during the
reporting period ended 30 June 2017, including low average oil prices throughout the period. No other impairments are
recognised for this reporting period.
Key assumptions used:
Crude oil price (US$)
Average AUD:USD exchange rate
CPI (%)
Pre-tax discount rate (%)
(b): Exploration and evaluation assets
Exploration assets
Total exploration and evaluation assets
2017-2019
$58 increasing to $70
$0.785
2.5%
9.0%
25
Movement in carrying amounts of exploration and evaluation assets:
Opening balance at the beginning of the year
Additions
Reclassification from (to) development asset
Write off – Exploration and evaluation asset
Carrying amount at the end of the year
15. Trade and other payables
Current
Trade payables
Amounts owing to Joint Operations
GST, FBT, PAYG & superannuation liability
Total trade and other payables
47
2020+
$78 increasing to $109
$0.77
2.5%
9.0%
$
$
9,688,826
9,688,826
9,124,857
9,124,857
$
$
9,124,857
117,621
456,611
(10,263)
9,688,826
9,218,674
69,466
(114,400)
(48,883)
9,124,857
$
$
171,597
597,682
14,603
783,882
98,170
200,837
176,491
475,498
Bounty Oil & Gas NL
Annual Report – 2017
Notes to the consolidated financial statements
for the year ended 30 June 2017
16. Provisions
Current - Provision for employee leave entitlement
Non-current - Provision for employee leave entitlement
Non-current - Rehabilitation costs – petroleum properties
30-Jun-17
$
30-Jun-16
$
24,162
24,162
26,764
26,764
8,598
1,281,930
1,290,528
7,373
1,256,114
1,263,487
Movement in provisions
Opening balance
Unwinding of discount on provision
De-recognition of rehabilitation provisions on disposal of petroleum asset
Net provisions recognised/(expensed)
Balance at the end of the period
The provision for rehabilitation costs represents the present value of the Directors’ best estimate of the future sacrifice of
economic benefits that will be required to remove the facilities and restore the affected areas at the Group’s operation sites.
The rehabilitation of the petroleum properties is expected to be undertaken between 1 to 20 years. The discount rate used in
the calculation of the provision as at 30 June 2017 was 3%, broadly equivalent to the Australian Government 10 year bond
rate.
1,256,114
25,816
-
8,598
1,290,528
1,731,061
37,110
(506,970)
(5,087)
1,256,114
17. Issued capital
A reconciliation of the movement in capital for the Company can be found in
the Consolidated Statement of Changes in Equity
953,400,982 fully paid ordinary shares (2016: 953,400,982)
Nil options transferred to reserve on expiry (2016: Nil)
(a) Movement in fully paid ordinary shares
Balance at beginning of period
Shares issued during the period
Balance at end of period
$
$
43,440,163
201,600
43,641,763
43,440,163
201,600
43,641,763
No. of Shares No. of Shares
953,400,982
953,400,982
-
-
953,400,982
953,400,982
18. Reconciliation of cash flow from continuing operations
Reconciliation of Cash Flow from continuing operations with profit/(loss) after income tax.
Profit/(Loss) from continuing operations after income tax
$
$
(387,788)
(4,427,200)
Non-cash flows in profit/(loss) from continuing operations:
Unearned income on rental lease
Depreciation and Amortisation
Unrealised (gain)/loss on listed securities
Unrealised foreign exchange (gain)/loss
Movement in provisions
Bad and doubtful debts
(Profit)/loss on sale of property,plant & equipment
Write-off of exploration assets
Impairment of petroleum production assets
Accrued interest income
(Increase) in trade and other receivables
Decrease in financial assets through profit and loss
(Increase)/Decrease in inventory
Movement in rehabilitation obligation
Increase/(Decrease) in trade & other payables
Net Cash from continuing operations
48
8,832
486,653
5,621
20,193
5,996
13,000
-
10,263
834,259
(819)
(1,125,264)
(6,110)
122
100,058
(330,228)
(365,212)
-
428,777
69,245
(7,555)
37,110
-
(207,198)
48,883
2,949,269
-
(5,470)
(5,344)
(9,385)
89,320
351,426
(688,122)
Bounty Oil & Gas NL
Annual Report – 2017
Notes to the consolidated financial statements
for the year ended 30 June 2017
19. Share based payments
2017
No share based payment compensation was granted to directors or senior management during the financial year ended 30th
June 2017 and there was Nil expensed (2016: Nil). During the year, no directors or senior management exercised options that
were granted to them as part of their compensation in prior periods.
2016
No share based payment compensation was granted to directors or senior management during the financial year ended 30th
June 2016 and there was Nil expensed. During the year, no directors or senior management exercised options that were granted
to them as part of their compensation in prior periods.
20. Key management personnel
a) Key Management Personnel Compensation
The aggregate remuneration made to Key Management
Personnel of the group is set out below:
Short term employee benefits
Share based payments
Total
30-Jun-17
$
30-Jun-16
$
578,081
-
578,081
607,962
-
607,962
Apart from the details disclosed in this note, no director or key management person has entered into a material contract with
the consolidated entity since the end of the previous financial year and there were no material contracts involving directors’ or
executives’ interests existing at year-end.
Information regarding individual directors' and executives' compensation and some equity instrument disclosures as permitted
by the Corporations Regulations 2M.3.03 is provided in the Remuneration Report section of the Directors' Report.
b) Equity Instrument Disclosures Relating to Key Management Personnel
i) Options provided as remuneration and shares issued on exercise of such options: Nil
ii) Share holdings
The movement during the reporting period in the number of ordinary shares in Bounty Oil and Gas N.L. held, directly, indirectly
or beneficially, by each key management person, inculding related parties, is as follows:
2017
Directors
G Reveleigh
R Payne
C Ross
Executives
P Kelso
2016
Directors
G Reveleigh
R Payne
C Ross
Executives
P Kelso
Balance at Start
of the Year
Purchases
Received on
exercise of
Options
Received other
Sales
Held at the end
of Year
23,377,928
-
3,200,000
- - - 23,377,928
- - - -
- - - 3,200,000
-
-
52,040,836 849,153 - - - 52,889,989
23,377,928 - - - - 23,377,928
- - - - - -
3,200,000 - - - - 3,200,000
52,696,662 - - - 655,826 52,040,836
No shares were granted to key management personnel during the financial year or during the previous financial year.
c) Key Management Personnel - Joint operations advances
No loans were made to key management personnel including their personally related entities during the financial year ended 30
June 2017 and no loans were outstanding at the end of the prior period, except that during the year, the Group advanced sums
totalling $104,107 to the Operator of joint operations in which the Group has petroleum interests. The CEO Mr. P. Kelso is a
director of the Operator. The advances were made in the ordinary course of business to support the joint operation activities.
49
Bounty Oil & Gas NL
Annual Report – 2017
Notes to the consolidated financial statements
for the year ended 30 June 2017
20. Key management personnel (continued)
d) Other transactions with key management personnel
Other than the transactions disclosed in the Remuneration Report contained in the Directors’ Report, during the financial year,
$30,000 was paid for rent and $17,868 was paid in legal fees to a firm in which Mr. P. Kelso is a principal .
Aggregate amounts of each of the above types of other transactions with entities associated with key management personnel
of Bounty Oil & Gas NL:
Legal, corporate fees
Rent of office
21. Commitments
30-Jun-17
$
17,868
30,000
47,868
30-Jun-16
$
-
30,000
30,000
In order to maintain current rights of tenure to its exploration permits, the company has certain obligations to perform work in
accordance with the work programmes, as approved by the relevant statutory body, when the permits are granted. These work
programs form the exploration commitment which may be renegotiated, varied between permits, or reduced due to farm-out,
sale, reduction of exploration area and/or relinquishment of non-prospective permits. Work in excess of the work programs
may also be undertaken.
The following discretionary exploration expenditure requirements have not been provided for in the accounts:
Payable
Not longer than 1 year
Longer than 1 year and not longer than 5 years
There are no lease commitments at the balance date.
22. Related party transactions
a. The Group’s main related parties are as follows:
Key Management Personnel
$
1,236,046
3,090,115
4,326,161
$
650,000
2,275,000
2,925,000
Any person(s) having authority or responsibility for planning, directing and controlling the activities of the Group, directly or
indirectly, including any director (whether executive or otherwise) of the Group are considered as key management personnel.
Disclosures relating to key management personnel are set out in Note 20 and in the Directors Report.
Controlled entities
Details of the percentage of ordinary shares held in controlled entities are disclosed in Note 24.
All inter-company loans and receivables are eliminated on consolidation and are interest free with no set repayment terms.
b. Transactions with other related parties:
The Group has a related party relationship with its joint ventures/joint operations (note 25) and with its key management
personnel. The Company and its controlled entities engage in a variety of related party transactions in the ordinary course of
business. These transactions are generally conducted on normal terms and conditions.
There were no transactions with related parties other than as disclosed in Note 20 and this Note 22.
23. Financial instruments
a) Capital management:
The Group manages its capital to ensure that entities in the Group will be able to continue as going concerns while maximising
the return to stakeholders. The Group’s overall strategy remains unchanged from last financial year.The Group's capital
structure consists of equity (comprising issued capital, reserves and retained earnings as detailed in Consolidated Statement of
Changes in Equity) and no debt. The Group is not subject to any externally imposed capital requirements.
The Board reviews the capital structure of the Group on an on-going basis. As part of this review, the Board considers the cost
of capital and associated risks.
50
Bounty Oil & Gas NL
Annual Report – 2017
Notes to the consolidated financial statements
for the year ended 30 June 2017
23. Financial instruments (continued)
The gearing ratio at the end of the reporting period was nil (2016: nil).
b) Categories of financial instruments:
Financial assets
Cash and cash equivalents
Loans and receivables
Available for sale financial assets designated as at FVTPL
Total financial assets
Note
12
Financial liabilities
Other amortised cost - trade creditors
Total financial liabilities
30-Jun-17
30-Jun-16
$
1,024,462
1,359,926
24,939
2,409,327
$
1,760,668
89,092
24,450
1,874,210
(783,882)
(783,882)
(475,498)
(475,498)
c) Financial risk management objectives:
The main risks the company is exposed to through its financial instruments are interest rate risk, foreign currency risk, liquidity
risk, credit risk and price risk.
Foreign currency risk:
Foreign currency risk is managed by retaining majority of its cash and payables in Australian currency. Petroleum sales are
received in USD with short term credit terms.
Liquidity risk:
The Group manages liquidity risk by maintaining adequate reserves and banking facilities by continuously monitoring forecast
and actual cash flows, and by matching the maturity profiles of financial assets and liabilities.
Credit risk:
The Group has adopted a policy of only dealing with credit worthy counterparties and only transacts with financial institutions
that are rated the equivalent of AA and above. The Group’s exposure and the credit ratings of its counterparties are
continuously monitored and transactions concluded are spread amongst approved counterparties. Trade receivables consist of
a limited number of customers, all of which are large creditworthy organisations.
The Company does not have any material credit risk exposure to any single debtor or company of debtors under financial
instruments or collateral securities entered into by the Company.
Commodity risk:
The sales revenue of the company is derived from sales of oil at the prevailing TAPIS or Dated Brent oil price on the Singapore
market in USD. Natural gas sales are governed by a fixed price contract. Sales volumes are not sufficient to undertake the
expense of entering derivative contracts to manage that risk.
d) Fair value of financial instruments:
Some of the Group's financial assets and financial liabilities are measured at fair value at the end of each reporting period. The
following table gives information about how the fair values of these financial assets and financial liabilities are determined (in
particular, the valuation technique(s) and inputs used).
The fair values of financial assets and liabilities with standard terms and conditions and traded on active liquid markets are
determined with reference to quoted market prices. The fair values of other financial assets and financial liabilities are
determined in accordance with generally accepted pricing models based on discounted cash flow analysis.
Except as detailed in the following table, the directors consider that the carrying amounts of financial assets and financial
liabilities recognised in the consolidated financial statements approximate their fair values.
Consolidated
Note
Fair value hierarchy
30-Jun-17
$
30-Jun-16
$
Financial assets at fair value
through profit or loss
Quoted bid prices
in an active market
12
Level 1
24,939
24,450
e) Sensitivity analysis
The company does not perform sensitivity analysis with respect to interest rate risk, foreign currency risk, liquidity risk, credit
risk or price risk.
51
Bounty Oil & Gas NL
Annual Report – 2017
Notes to the consolidated financial statements
for the year ended 30 June 2017
24 . Controlled entities
The consolidated financial statements incorporate the assets, liabilities and results of the following controlled
entities in accordance with the accounting policy described in note 2 (c)(i).
Name of entity
Ausam Resources Pty Ltd.
Interstate Energy Pty Ltd.
Country of Incorporation
Australia
Australia
Class of shares
Ordinary
Ordinary
30-Jun-17
30-Jun-16
Equity holding % (1)
100
100
100
100
(1) The proportion of ownership interest is equal to the proportion of voting power held.
Principal
activity
Production
Principal place of
business
Measurement
Method
Proportionate Adelaide, Australia
25. Interest in joint operations
Set out below are the joint arrangements of the Group as at 30 June 2017, which in the opinion of the directors are
material to the Group:
Name of the joint
arrangement
ATP 1189P Naccowlah
block
Nyuni PSA
Kiliwani North
ATP 754P
PEP11
The Group’s joint operations agreements require majority consent from all parties for all relevant activities. The
joint participants own the assets of the joint operations as tenants in common and are jointly and severally liable
for the liabilities incurred by the joint operations. These entities are therefore classified as joint operations and the
group recognises its direct right to the jointly held assets, liabilities, revenues and expenses as described in note
2(c)(ii) & 2(d).
Proportionate Dar es Salaam, Tanzania
Proportionate Dar es Salaam, Tanzania
Proportionate Brisbane, Australia
Proportionate Perth, Australia
Exploration
Production
Exploration
Exploration
Ownership interest (%)
(*approx)
10%
9.5%*
50%
15%
10%
9.5%*
50%
15%
2%
2%
The accounting policies adopted for the group’s joint operations are consistent with those in previous financial year.
The company’s share of revenue and expenses from joint operations are included in the Consolidated Statement of
Comprehensive Income. The company’s share of the assets and liabilities held in joint operations are included in
the Consolidated Statement of Financial Position.
The company holds significant petroleum production and development joint operations interests included in the
Consolidated Statements as follows:
(i) a 9.5% interest in Kiliwani Gas Development Block as part of larger, the Nyuni Block in Tanzania.
(ii) a 2% interest in various Petroleum Leases and part of ATP 1189P, Queensland and associated oil production
tangibles and pipelines referred to as the Naccowlah Block.
Details of the total revenue and expenses derived from or incurred in Kiliwani Gas Development Block and ATP
1189P joint operations and the company’s share of the assets and liabilities employed in these joint operations are
as follows:
$
$
Revenue from petroleum
Petroleum and all other expenses
Net Profit/(Loss) from joint operations
Current assets
Trade receivables
Inventories
Non current assets
Property, plant & equipment (net of accumulated depreciation)
Other non-current assets
Total assets in joint operations
Current liabilities
Trade and other payables
Non current liabilities
Provisions
Total liabilities in joint operations
Net interest in joint operations
52
2,677,801
(1,108,289)
1,569,512
1,077,497
(1,532,830)
(455,333)
1,169,722
26,270
504,228
4,926,296
6,626,516
56,658
49,035
492,327
6,082,891
6,680,911
525,832
200,837
1,049,917
1,575,749
1,038,789
1,239,626
5,050,767
5,441,285
Bounty Oil & Gas NL
Annual Report – 2017
Notes to the consolidated financial statements
for the year ended 30 June 2017
25. Interest in joint operations (continued)
Interests in other joint operation entities
Also included in the Consolidated Financial Statements as at 30 June 2017, the group held interests in joint operations whose
principal activities were exploration, evaluation and development of oil and gas but not accruing material revenue.
The company contributes cash funds to the joint operations by way of cash calls for a specified percentage of total exploration
and development activities. Other than the ATP1189P Naccowlah Block and Kiliwani North, Tanzania production Joint
Operations none of the joint operations hold any material assets and accordingly the Company’s share of exploration,
evaluation and development expenditure is accounted for in accordance with the policy set out in Note 1.
26. Parent entity information
The accounting policies of the parent entity, which have been applied in determining the financial information shown below,
are same as those applied in the consolidated financial statements. Refer to Note 1 for a summary of the significant accounting
policies relating to the Group. After review of policies, the Board resolved to reclassify the intercompany loans to controlled
entities as non current assets.
The individual financial statements for the parent entity Bounty Oil & Gas NL show the following aggregate amounts:
Statement of Financial Position
Assets
Current assets
Non-current assets
Total Assets
2,173,027
18,839,432
21,012,459
30-Jun-17
$
30-Jun-16
$
6,649,795
14,400,508
21,050,303
795,621
1,096,721
1,892,342
19,120,117
509,411
1,075,373
1,584,784
19,465,519
43,440,163
201,600
(24,521,646)
19,120,117
43,440,163
201,600
(24,176,244)
19,465,519
(345,401)
-
(345,401)
(4,401,841)
-
(4,401,841)
1,083,546
2,708,865
3,792,411
450,000
1,800,000
2,250,000
Liabilities
Current liabilities
Non-current liabilities
Total Liabilities
Net Assets
Equity
Issued capital
Reserves
Retained earnings/Accumulated losses
Total Equity
Statement of Profit and Loss and other Comprehensive Income
Loss for the year
Other comprehensive income/(loss)
Total Comprehensive loss for the year
Commitments for Capital Expenditure
No longer than 1 year
Longer than 1 year and not longer than 5 years
Total
There are no operating lease commitments at the balance date.
53
Bounty Oil & Gas NL
Annual Report – 2017
Notes to the consolidated financial statements
for the year ended 30 June 2017
27. Contingent liabilities and contingent assets
As at the date this report, there were no contingent assets or liabilities, other than the exploration commitments set out in Note
21 and the following:
There is no other litigation against or involving Bounty Oil & Gas N.L. or its subsidiaries of which the Directors are aware.
28. Events occurring after the reporting period
No matters or circumstances have arisen since the end of the financial year which have significantly affected or may
significantly affect the operations of the company, the results of those operations, or the state of affairs of the company in
future financial years. other than the litigation with OWK referred to in Contingent liabilities and contingent assets above.
29. Auditors remuneration
Remuneration of the auditors of the Company for:
- Auditing or reviewing the financial reports for year
- Other services
30-Jun-17
$
26,500
-
26,500
The auditor to Bounty Oil & Gas NL is William M Moyes, Suite 1301, Level 13, 115 Pitt Street, Sydney NSW 2000.
30-Jun-16
$
48,000
-
48,000
30. Company details
Bounty Oil & Gas NL’s registered office and its principal place of business are as follows:
Registered Office
Level 7, 283 George Street,
Sydney, NSW, 2000, Australia
Tel: (02) 9299 7200
Principal place of business
Level 7, 283 George Street,
Sydney, NSW, 2000, Australia
Tel: (02) 9299 7200
54
Bounty Oil & Gas NL
DIRECTORS’ DECLARATION
Annual Report – 2017
a) The directors of Bounty Oil and Gas NL (“the Company”) declare that the financial statements and notes, as set out on pages
16 to 42 are in accordance with the Corporations Act 2001:
(i) comply with Accounting Standards and the Corporations Regulations 2001; and
(ii) give a true and fair view of the financial position as at 30th June 2017 and of the performance for the year ended on that
date of the Company;
b) The Chief Executive Officer and the Chief Financial Officer have each declared that:
(i) The financial records of the company for the financial year have been properly maintained in accordance with Section 286 of
the Corporations Act 2001.
(ii) The financial statements and notes for the financial year comply in all material respects with the Accounting Standards;
(iii) The financial statements and notes give a true and fair view.
c) In the directors’ opinion, there are reasonable grounds to believe that the company will be able to pay its debts as when they
become due and payable.
This declaration is made in accordance with a resolution of the Board of Directors.
Graham Reveleigh
Director
Dated: 29 September 2017
55
Bounty Oil & Gas NL
Annual Report – 2017
1. Additional Information Required by ASX Listing Rules
The following is additional information provided in accordance with the Listing Rules of the Australian
Securities Exchange Limited.
Analysis of equity security holders as at 25 September 2017:
a) Analysis of numbers of holders of fully paid ordinary shares:
No. of Securities
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 and above
No. of
Shareholders
206
118
447
1,753
1,043
3,567
b)
Twenty largest holders of quoted equity securities at 25 September 2017:
Ordinary Shareholders
Comadvance Pty Ltd.
Robert A Hutchfield
Red Kite Capital Inc.
Les Selwood Pty Ltd.
David Alan McSeveny
Bang Vi Khanh
Tri-Ex Holdings Pty Ltd.
WH Ave LLC
G E Reveleigh & Co Pty Ltd.
Kestrel Petroleum Pty Ltd.
Barry Sheedy & Associates Pty Ltd.
Granborough Pty Ltd.
Level 1 PL
Ann Spooner
Jordan Vujic
William John & S Tyler
Simon Saliba
GH Corporate Services Pty Ltd
Robert Cameron Galbraith
Milica Vujic
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
Fully paid
number
45,590,563
34,580,200
27,022,000
21,517,764
24,063,006
19,480,000
19,177,778
18,000,000
17,479,118
15,175,000
13,893,700
12,000,000
11,284,254
7,772,217
7,023,826
7,000,000
7,000,000
6,783,061
6,500,000
6,017,870
%
4.78%
3.63%
2.83%
2.26%
2.52%
2.04%
2.01%
1.89%
1.83%
1.59%
1.46%
1.26%
1.18%
0.82%
0.74%
0.73%
0.73%
0.71%
0.68%
0.63%
Total Top 20 Holders
327,360,357
34.34%
c) Options at 25 September 2017:
i)
ii)
there were no listed and quoted options over ordinary shares.
there were no unlisted options over ordinary shares.
60
Bounty Oil & Gas NL
Annual Report – 2017
2.
Substantial Shareholders
As at 25 September 2017 there were no substantial shareholders as disclosed in substantial
shareholders notices given to the company.
3.
Issued Shares and Distribution
a) The total number of fully paid ordinary shares on issue on 25 September 2017 was 953,400,982.
b) There were 2,276 holders of less than a marketable parcel of ordinary shares, totalling 55,500,138
shares.
c) The percentage of the total holding of the 20 largest shareholders of ordinary shares was 34.34% of
issued capital.
4.
Stock Exchange Listing
Quotation has been granted for all the ordinary shares of the company on the Australian Securities
Exchange (ASX) under the code BUY.
5.
Income Tax
The company is taxed as a public company.
6. Voting Rights
On show of hands one vote for every registered Shareholder and on a poll, one vote for each share
held by a registered Shareholder.
7. Additional Information
Information in these financial statements (or in the annual report) that relates to or refers to
petroleum exploration and prospectivity or petroleum or hydrocarbon reserves or resources is based
on information compiled and/or written by Mr Philip F Kelso the CEO of Bounty Oil & Gas NL. Mr Kelso
is a Bachelor of Science (Geology) and has practised geology and petroleum geology for in excess of 40
years. He is a member of the Petroleum Exploration Society of Australia and a Member of the
Australasian Institute of Mining and Metallurgy. Mr Kelso is a qualified person as defined in the ASX
Listing Rules: Chapter 19 and consents to the reporting of that information in the form and context in
which it appears in this report.
The company continues to comply with the ASX Listing Rules disclosure requirements. The company
reports to ASX which makes available all reports to those who wish to access them. All ASX releases
and other background information are posted regularly on the company’s website. The company
intends to post on its website its annual report and all other required notices to its shareholders.
The board reviews and receives advice on areas of operational and financial risks. Business risk
management strategies are developed as appropriate to mitigate all identified risks of the business.
The directors are aware of the guidelines for the content of a code of conduct to guide compliance
with legal and other obligations to shareholders but have not formally established such a code. Where
applicable to its activities, the directors ensure that the company is responsible to its shareholders,
employees, contractors, advisers, individuals and the community.
8.
Secretary
The name of the Secretary of the company is Sachin Saraf.
9.
Share Buy Back
There is no current on market share buy back.
61
Bounty Oil & Gas NL
Annual Report – 2017
Schedule of Petroleum Tenements - 19 September 2017
Permit
Basin
Interest
Gross km2 Net km2 Operator
Australia Offshore
AC/P32
PEP 11
Australia Onshore
PRL 33 – PRL 49 FO
inclusive replacing EL 218
(Post Permian)
ATP 1189P (formerly 259P)
Naccowlah Block
PL 23
PL 24
PL 25
PL 26
PL 35
PL 36
PL 62
PL 76
PL 77
PL 78
PL 79
PL 82
PL 87
PL 105/PL 287
PL 496 (ex PL 107)
PL 495 (ex PL 109)
PL 133
PL 149
PL 175
PL 181
PL 182
PL 189
Ashmore Cartier
Territory - Vulcan Basin
100%
336
336
Bounty
NSW - Sydney Basin
15%
4,577
686.5
Asset
Energy PL8
SA – Cooper - Eromanga
Basin.
23.28%
1,603.5
373.3
Beach
Energy1
SW Qld – Cooper -
Eromanga Basin.
SW Qld – Cooper -
Eromanga Basin.
SW Qld – Cooper -
Eromanga Basin.
SW Qld – Cooper -
Eromanga Basin.
SW Qld – Cooper -
Eromanga Basin.
SW Qld – Cooper -
Eromanga Basin.
SW Qld – Cooper -
Eromanga Basin.
SW Qld – Cooper -
Eromanga Basin.
SW Qld – Cooper -
Eromanga Basin.
SW Qld – Cooper -
Eromanga Basin.
SW Qld – Cooper -
Eromanga Basin.
SW Qld – Cooper -
Eromanga Basin.
SW Qld – Cooper -
Eromanga Basin.
SW Qld – Cooper -
Eromanga Basin.
SW Qld – Cooper -
Eromanga Basin.
SW Qld – Cooper -
Eromanga Basin.
SW Qld – Cooper -
Eromanga Basin.
SW Qld – Cooper -
Eromanga Basin.
SW Qld – Cooper -
Eromanga Basin.
SW Qld – Cooper -
Eromanga Basin.
SW Qld – Cooper -
Eromanga Basin.
SW Qld – Cooper -
Eromanga Basin.
SW Qld – Cooper -
Eromanga Basin.
62
2%
2%
2%
2%
2%
2%
2%
2%
2%
2%
2%
2%
2%
2%
2%
2%
2%
2%
2%
2%
2%
2%
2%
1,064.5
21.3
Santos 2
234.6
200.9
256
255.9
136.5
60.9
64.7
39.5
12.2
12.1
6.5
10.4
27.5
12.2
12.2
9.2
12.2
12.2
27.5
18.3
27.5
18.3
4.7
4.0
5.1
5.1
2.7
1.2
1.3
0.8
0.2
0.2
0.1
0.2
0.6
0.2
0.2
0.2
0.2
0.2
0.6
0.4
0.6
0.4
Santos 2
Santos 2
Santos 2
Santos 2
Santos 2
Santos 2
Santos 2
Santos 2
Santos 2
Santos 2
Santos 2
Santos 2
Santos 2
Santos 2
Santos 2
Santos 2
Santos 2
Santos 2
Santos 2
Santos 2
Santos 2
Santos 2
Bounty Oil & Gas NL
Annual Report – 2017
PL 302
PL 2 Alton Oilfield
PL 2A
PL 2B
PL 2C
PL 119 (PL 441)
ATP 1190 (SG) (4)
ATP 754P
PPL 58 Pipeline Licence6
EP 359
EP 435
PL 104-L16 (Petroleum
Lease)
Tanzania Offshore
Nyuni Block
Kiliwani North
Development Block
Total
SW Qld – Cooper -
Eromanga Basin.
Qld - Surat Basin
Qld - Surat Basin
Qld - Surat Basin
Qld - Surat Basin
Qld - Surat Basin
Qld - Surat Basin
Qld - Surat Basin
Qld – Surat Basin
WA - Carnarvon Basin
WA - Carnarvon Basin
WA - Carnarvon Basin
2%
100%
81.75%
81.75%
100%
100%
24.748%
50%
100%
10%
10%
10%
12.2
16
66.8
136.7
45.2
21.4
15.3
833
555
238
79.1
0.2
16
54.6
111.7
16.5
21.4
3.8
416.5
55.5
23.8
7.9
Santos 2
Bounty
Bounty
Bounty
Bounty
Ausam
AGL
Ausam7
Ausam7
Rough
Range 3
Rough
Range 3
Rough
Range 3
Mandawa Basin
Mandawa Basin
10%
9.5%
1,682
168.2
Ndovu5
168
16.8
Ndovu5
12,917
2,359.20
1. Beach Energy Limited
2. Santos Limited group companies
3. Rough Range Oil Pty Ltd.
4. (SG) – Spring Grove joint venture block
5. Ndovu Resources Limited (a subsidiary of Aminex PLC)
6. Pipeline Licence 58
7. Ausam Resources Pty Ltd is a wholly owned subsidiary of Bounty Oil & Gas NL
8. Asset Energy Pty Ltd is a wholly owned subsidiary of Advent Energy Ltd
63
Bounty Oil & Gas NL
Annual Report – 2017
ABBREVIATIONS
The following definitions are provided for readers who are unfamiliar with industry terminology:
AVO
Barrel (bbl/BBL)
Specialised analysis of seismic data comparing amplitude of sound waves versus
collection point offsets
A unit of volume of oil production, one barrel equals 42 US gallons, 35 imperial gallons
or approximately 159 litres
Basin
BCF/Bcf
BOPD/BPD
A segment of the earth’s crust which has down warped and in which sediments have
accumulated, such areas may contain hydrocarbons.
Billion cubic feet, i.e. 1,000 million cubic feet (equivalent to approximately 28.3 million
cubic metres) of gas.
Barrels of oil per day; barrels per day.
Contingent Resources
Discovered resources, not yet fully commercial
CSG
GIIP
Lead
License
MCF/Mcf
MDRT
MMB/mmb,
MMBO/mmbo
MMCF/mmcf,
MMCFG/mmcfg,
MMCFGPD/mmcfgpd
P10
P90
Coal seam gas.
Gas initially in place
A structural or stratigraphic feature which has the potential to contain hydrocarbons
An agreement in which a national or state government gives an oil Company the rights
to explore for and produce oil and/or gas in a designated area.
Thousand cubic feet – the standard measure for natural gas.
Measured depth below Rotary Table
Million barrels, million barrels of oil.
Million cubic feet, million cubic feet of gas, million cubic feet of gas per day
10% probability of occurrence
90% probability of occurrence
Permeability
The degree to which fluids such as oil, gas and water can move through the pore spaces
of a reservoir rock.
Permit
Play
A petroleum tenement, lease, licence or block.
A geological concept which, if proved correct, could result in the discovery of
hydrocarbons.
Plug and Abandon
(P&A)
The process of terminating operations in a well. Cement plugs are set in the borehole
and the rig moves off the location. The borehole is thus left in a safe condition. In some
cases, where the Operator considers it possible that the well may be re-entered at a
later date, the well may be only temporarily plugged and abandoned.
Pmean
The average (mean) probability of occurrence
64
Bounty Oil & Gas NL
Annual Report – 2017
Porosity
The void space in a rock created by cavities between the constituent mineral grains.
Liquids are contained in the void space.
Prospect (petroleum)
A geological or geophysical anomaly that has been surveyed and defined, usually by
seismic data, to the degree that its configuration is fairly well established and on which
further exploration such as drilling can be recommended.
Prospective Resources
Undisclosed resources
PSA
PSC
PRL
Reserves
Reservoir
Production Sharing Agreement
Production Sharing Contract
Petroleum Retention Lease
Quantities of economically recoverable hydrocarbons estimated to be present within a
trap, classified as prove, probably or possible.
A subsurface volume of rock of sufficient porosity and permeability to permit the
accumulation of crude oil and natural gas under adequate trap conditions.
Seal, Sealing Formation
A geological formation that does not permit the passage of fluids. Refer also to Cap
Rock.
Seismic Survey
A type of geophysical survey where the travel times of artificially created seismic waves
are measured as they are reflected in a near vertical sense back to the surface from
subsurface boundaries. This data is typically used to determine the depths to the tops
of stratigraphic units and in making subsurface structural contour maps and ultimately
in delineating prospective structures.
Spud
To start the actual drilling of a well.
Stratigraphic Trap
A type of petroleum trap which results from variations in the lithology of the reservoir
rock, which cause a termination of the reservoir, usually on the up dip extension.
Structure
Sub-basin
TCF/Tcf
TVDS
Up-dip
A discrete area of deformed sedimentary rocks, in which the resultant bed configuration
is such as to form a potential trap for migrating hydrocarbons.
A localised depression within a basin.
Trillion cubic feet.
Total vertical depth below Sea Level
At a structurally higher elevation within dipping strata.
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Bounty Oil & Gas NL
Annual Report – 2017
CORPORATE DIRECTORY
Board of Directors
Share Registry
Graham C Reveleigh (Chairman)
Charles Ross
Roy Payne
Security Transfer Registrars Pty Ltd
770 Canning Highway
Applecross, WA, 6153
Chief Executive Officer
Philip F. Kelso
Company Secretary
Sachin Saraf
Telephone:
Facsimile:
Email: registrar@securitytransfer.com.au
+61 3 9628 2200
+61 8 9315 2233
Bankers
BankWest, Sydney
Commonwealth Bank of Australia, Sydney
Registered and Principal Office
Legal Counsel
Level 7 , 283 George Street,
Sydney, NSW, 2000, Australia,
Telephone: +61 2 9299 2007
+61 2 9299 7300
Facsimile:
corporate@bountyoil.com
Email:
www.bountyoil.com
Website:
Dentons Australia
77 Castlereagh Street
Sydney, NSW, 2000
Independent Consulting Petroleum Engineers
NauticAWT
Level 10, 300 Ann Street,
Brisbane, QLD, 4000.
Apex Energy Consultants Inc,
700, 815 8th Avenue S.W.
Calgary, Alberta, T2P 3P2
Canada
Auditors
William M Moyes
Suite 1301 , Level 13
115 Pitt Street
Sydney NSW 2000
Telephone: +61 2 8256 1100
Facsimile: +61 2 8256 1111
66