DORIEMUS PLC
Annual Report and Financial Statements
Year Ended 31 December 2020
Company Registered Number 03877125 (England and Wales)
ARBN 619 213 437
DORIEMUS PLC
Annual Report and Financial Statements
for the year ended 31 December 2020
CONTENTS
COMPANY INFORMATION .......................................................................................................................................................... 1
CHAIRMAN’S STATEMENT INCORPORATING REVIEW OF OPERATIONS AND STRATEGIC REPORT ............................................... 2
REPORT OF THE DIRECTORS FOR THE YEAR ENDED 31 DECEMBER 2020 ..................................................................................... 6
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF DORIEMUS PLC ............................................................................... 12
FINANCIAL STATEMENTS .......................................................................................................................................................... 19
Consolidated Statement of Profit or Loss and Other Comprehensive Income for the year ended 31 December 2020 ........... 19
Company Statement of Profit or Loss and Other Comprehensive Income for the year ended 31 December 2020 ................. 20
Consolidated Statement of Changes in Equity for the year ended 31 December 2020 ............................................................ 21
Company Statement of Changes in Equity for the year ended 31 December 2020 .................................................................. 22
Consolidated Statement of Financial Position at 31 December 2020 ....................................................................................... 23
Company Statement of Financial Position at 31 December 2020 ............................................................................................. 24
Consolidated Statement of Cash Flows for the year ended 31 December 2020 ....................................................................... 25
Company Statement of Cash Flows for the year ended 31 December 2020 ............................................................................. 26
Notes forming part of the financial statements for the year ended 31 December 2020 .......................................................... 27
ADDITIONAL INFORMATION FOR ASX LISTED PUBLIC COMPANIES ........................................................................................... 46
CORPORATE GOVERNANCE STATEMENT .................................................................................................................................. 50
COMPANY INFORMATION
DIRECTORS:
DORIEMUS PLC
Keith Coughlan – Non Executive Chairman
Gregory Lee – Executive Director
Donald Strang – Non Executive Director
JOINT COMPANY SECRETARIES:
Donald Strang & Jessamyn Lyons
UK REGISTERED AND PRINCIPAL OFFICE:
AUSTRALIAN REGISTERED OFFICE
c/o Hill Dickinson LLP
The Broadgate Tower
20 Primrose Street
London
EC2A 2EW
Suite 2,
11 Ventnor Avenue,
West Perth, WA
6005, Australia
REGISTERED NUMBER:
03877125 (England & Wales)
AUDITORS:
SOLICITORS:
SHARE REGISTRY:
Elderton Audit (UK)
Level 2/267 St. Georges Terrace
Perth WA 6000
Hill Dickinson LLP
The Broadgate Tower
20 Primrose Street
London
EC2A 2EW
Computershare Investor Services Pty Limited
11/172 St Georges Terrace
Perth WA
6000 Australia
1
DORIEMUS PLC
(“Doriemus” or the “Company”)
CHAIRMAN’S STATEMENT INCORPORATING REVIEW OF OPERATIONS AND STRATEGIC REPORT
The Company is pleased to present this Annual Report, together with the financial statements and annual corporate governance
statement, on the Company (referred to hereafter as ‘Doriemus') consisting of Doriemus Plc (referred to hereafter as the
'Company' or 'parent entity') and the entities it controlled at the end of, or during, the full year ended 31 December 2020.
REVIEW OF OPERATIONS:
OIL PRODUCTION AND EXPLORATION ASSETS
1.
Horse Hill (“HH”) Petroleum Exploration and Development License:
Doriemus currently owns 4% of Horse Hill Developments Limited (“HHDL”), which owns 65% of two Petroleum Exploration and
Development Licences (“PEDL”) PEDL137 and PEDL246 in the northern Weald Basin between Gatwick Airport and London. The
PEDL137 licence covers 99.29 km2 to the north of Gatwick Airport in Surrey and contains the Horse Hill-1 (“HH-1”) discovery well.
PEDL246 covers an area of 43.58 km2 and lies immediately adjacent and to the east of PEDL137 which hosts the HH-1 oil discovery
well located in PEDL137 in the UK’s onshore Weald Basin. This equates to a 2.6% attributable interest in the licences. HHDL is the
nominated operator (“Operator”) of the Horse Hill License.
Horse Hill-Field
Following planning approval for Horse Hill production in September 2019, the most recent key event was the Oil and Gas
Authority's (OGA) consent to the Field Development Plan (FDP) in March 2020 and the permission to produce. This milestone
allows long-term production from this asset.
The Operator of the Horse Hill-1 well (HH-1) advised on November 5th that a well intervention had been completed and that the
well has now been shut in for a long term pressure build up test ("PBU"), designed to provide data necessary to understand
whether the intervention comprising reperforating Portland and simplifying the production string had achieved the desired
optimisation of well inflow. Further updates will be reported when the PBU data has been fully analysed and interpreted. On
December 22nd the Operator announced that following a judicial review (“JR”) hearing of 17-18 November 2020, the Hon Justice
Holgate published his judgement which comprehensively dismissed the challenge to the lawfulness of the planning consent given
by Surrey County Council ("SCC") in September 2019 to long term oil production at Horse Hill. The Operator announcement also
notes that the full judgement will be made available on UKOG’s website in due course.
On the 15th of January the Operator announced that the combined Kimmeridge and Portland production had exceeded 132,000
barrels of oil and that a recent well intervention on HH-1 that entailed perforating the entire Portland interval and optimising the
down hole pump depth had been completed. The operator is currently experimenting with different flow rates and shut in times
to reduce or stabilize the water production. It was also announced that due to the increasing water production from the reservoir
and the cost of transportation and disposing of the water offsite the operator was planning to convert HH-2Z into a water disposal
well. The operator also announced that through some additional technical work it undertook that they had determined that
several more infill wells could be drilled in the field. The operator reports that it expects to plan to drill HH-3 Portland and HH-4
Kimmeridge infill wells at Horse Hill once the operator has completed its appraisal drilling campaign on a totally unrelated project
to Horse Hill.
2.
Brockham Production Licence:
Doriemus owns a 10% direct interest in the Brockham Oil Field which is held under UK Production Licence PL235 and operated by
Angus Energy Plc (the “Operator”). On 22 October 2020 Doriemus announced the Company agreed to dispose of its entire 10%
interest in Brockham to a subsidiary of Angus Energy Plc (the “Operator) for consideration of GBP10,000 (AUD18,000).
To document the disposal and associated matters, the parties have executed a sale and purchase agreement. The transfer of the
Doriemus interest in Brockham to the Operator was subject to the Operator receiving approval from the UK Regulator and other
ownership parties of the Brockham Oil Field. To date the Operator is yet to receive all of these approvals and continues to work
through these matters. As a result the Group’s interest has been written down to AUD18,000. The transfer of Doriemus’ interest
in Brockham will complete after the UK regulator approves the transfer. Further update will be provided in due course.
2
DORIEMUS PLC
(“Doriemus” or the “Company”)
CHAIRMAN’S STATEMENT INCORPORATING REVIEW OF OPERATIONS AND STRATEGIC REPORT
2.
Brockham Production Licence:
The consideration will be set-off against all of the remaining accrued contractual amounts owed by Doriemus to the Operator
under the existing joint operating agreement, including historic cash calls, abandonment liabilities and VAT, which total
approximately GBP260,000 (AUD 475,000).
The disposal reflects the Company’s broader strategy to seek to divest some of its existing assets to decrease its ongoing operating
costs and shifts focus to other projects that the Board believe can add shareholder value. Angus Energy Plc (‘the Operator”) has
previously announced their intention as the Operator to possibly dispose of its own interest in Brockham. In the meantime, the
Operator has recently prepared a hydrogeological risk assessment to address a water injection proposal for the field. This is
currently under review with the Environmental Agency.
3.
Isle of Wight PEDL331 (Arreton Oil Discovery):
Doriemus has a 5% participating interest in a 200km2 onshore Isle of Wight Petroleum Exploration and Development License
(“PEDL 331”). The Isle of Wight PEDL331 Arreton license contains a discovery well, Arreton, plus several geologically similar
prospects, Arreton South and North prospects.
The Arreton planning application submitted in March 2020 and public consultation is still ongoing. The EA permit application for
Arreton will be submitted shortly. The Operator (UKOG) intends to drill, sidetrack and test an Arreton 3/3z well which will appraise
the Arreton-2 oil discovery made by British gas in the 1970’s. The primary target will be the Portland oil discovery, but the well
will also test the underlying Kimmeridge section.
4.
Greenland Gas & Oil Plc:
The Company has a small shareholding in the English registered company Greenland Gas and Oil Plc (“GGO”), which is an early
stage oil and gas exploration company focused on acquiring oil and gas exploration assets in Greenland. There were no material
updates over the year.
Position and Principal Risks
The Company’s business strategy is subject to numerous risks, some outside the Board’s and management’s control. These risks
can be specific to the Company, generic to the extraction industry and generic to the stock market as a whole. The key risks,
expressed in summary form, affecting the Group and its future performance include but are not limited to:
• capital requirement and ability to attract future funding to finance the acquisition and exploitation of mining, oil and gas assets;
• change in commodity prices and market conditions;
• geological and technical risk posed to exploration and commercial exploitation success;
• environmental and occupational health and safety risks;
• government policy changes;
• retention of key staff.
This is not an exhaustive list of risks faced by the Group. There are other risks generic to the stock market and the world economy
as a whole and other risks generic to the extraction industry, all of which can impact on the Company. The management of risks
is integrated into the development of the Company’s strategic and business plans and is reviewed and monitored regularly by the
Board. Further details on how the Company monitors, manages and mitigates these risks are included as part of the Audit and
Risk Committee Report contained within the Corporate Governance Report.
3
DORIEMUS PLC
(“Doriemus” or the “Company”)
CHAIRMAN’S STATEMENT INCORPORATING REVIEW OF OPERATIONS AND STRATEGIC REPORT
DIRECTORS’ SECTION 172 STATEMENT
The following disclosure describes how the Directors have had regard to the matters set out in section 172(1)(a) to (f) and forms
the Directors’ statement required under section 414CZA of The Companies Act 2006. This new reporting requirement is made in
accordance with the new corporate governance requirements identified in The Companies (Miscellaneous Reporting) Regulations
2018, which apply to company reporting on financial years starting on or after 1 January 2019.
The matters set out in section 172(1) (a) to (f) are that a Director must act in the way they consider, in good faith, would be most
likely to promote the success of the Company for the benefit of its members as a whole, and in doing so have regard (amongst
other matters) to:
(a) the likely consequences of any decision in the long term;
(b) the interests of the Company’s employees;
(c) the need to foster the Company’s business relationships with suppliers, customers and others;
(d) the impact of the Company’s operations on the community and the environment;
(e) the desirability of the Company maintaining a reputation for high standards of business conduct; and
(f) the need to act fairly between members of the Company.
Stakeholder Engagement
Doriemus adheres to sound corporate governance policies and attaches considerable importance to and strives to engage
transparently and effectively on a continuous basis with a variety of stakeholders, including shareholders, employees, contractors,
suppliers, government bodies and local communities and environment in which it operates.
At the Company’s AGM held on 8 September 2020, all resolutions were passed with majority of the votes cast in favour. The
Directors and Company Secretary are usually available at and following general meetings of the Company when shareholders have
the opportunity to ask questions on the business of the meeting and more generally on Company matters.
All substantial shareholders that own more than 5% of the Company’s shares are listed on page 48 of this Report. Further details
of engagement with shareholders can be found within the Corporate Governance Report.
Employee
Doriemus attaches great importance to its employees and their professional development and provides fair remuneration with
incentives for its senior personnel through share option schemes Further, the Company gives full and fair consideration to
applications for employment irrespective of age, gender, colour, ethnicity, disability, nationality, religious beliefs or sexual
orientation.
Contractors and Suppliers
The Group has a prompt payment policy and seeks to ensure that all liabilities are settled within each supplier’s terms. Through
fair dealings the Group aims to cultivate the goodwill of its contractors, consultants and suppliers.
Corporate and local management work closely with contractors and suppliers in the to ensure they work within the parameters
of their respective terms of engagement and do not have a detrimental effect on the Company’s business and exploration
activities.
Governmental Bodies, local communities and environment
The Group takes significant cognisance of the importance to the communities in which it operates and is grateful for their support
and involvement in the Company’s exploration and development activities.
Principal decisions taken by the Board during the year
Principal decisions are defined as those that have long-term strategic impact and are material to the Group and those that are
significant to the Group’s key stakeholder Groups. In making the principal decisions, the Board considered the alignment with its
stated strategy, the outcome from its stakeholder engagement, the need to maintain a reputation for high standards of business
conduct and the need to act fairly between the members of the Company.
4
DORIEMUS PLC
(“Doriemus” or the “Company”)
CHAIRMAN’S STATEMENT INCORPORATING REVIEW OF OPERATIONS AND STRATEGIC REPORT
Covid-19
Doriemus continues to monitor the situation very closely, with a primary focus on the health, wellbeing and safety of all its
employees. The Group has implemented extensive business continuity procedures to ensure that they are able to operate with
minimal disruptions.
Covid-19 can affect the stock markets and in doing so impair the Company’s ability to attract investors and lenders. This in turn
could have an impact on any fund raising or financing arrangements that the Company may require to pursue.
The Directors would like to take this opportunity to thank our shareholders, staff and consultants for their continued support.
Keith Coughlan
Non-Executive Chairman
17 March 2021
5
REPORT OF THE DIRECTORS FOR THE YEAR ENDED 31 DECEMBER 2020
DORIEMUS PLC
The Directors present their report together with the audited financial statements of the Group for the year ended 31 December
2020.
The Corporate Governance Statement set out in pages 50 to 58 forms part of this Directors’ Report.
Directors
The names of Directors of the Company in office at any time during or since the end of the year are:
Keith Coughlan - appointed on 19th June 2019
Donald Strang – appointed 15 March 2013
Gregory Lee – appointed 29 September 2017
Directors have been in office of the Company since the start of the financial year to the date of this report unless otherwise stated.
Joint Company Secretaries
Donald Strang & Jessamyn Lyons
Information on Directors
Keith Coughlan – Non Executive Chairman
Mr Coughlan has almost 30 years’ experience in stockbroking and funds management. He has been largely involved in the funding
and promoting of resource companies listed on ASX, AIM and TSX. He has advised various companies on the identification and
acquisition of resource projects and was previously employed by one of Australia’s then largest funds management organizations.
Interest in CDIs and Options – Nil
Directorships held in other listed entities:
– Executive Chairman of European Metals Holdings Ltd (from 6 September 2013)
– Non Executive Director of Calidus Resources Limited (from 13 June 2017)
– Non Executive Director of Southern Hemisphere Mining Limited (from 24 March 2017 to 5 February 2021)
Donald Strang – Non Executive Director
Mr Strang has been a director of the Company since 15 March 2013. Mr. Strang is a member of the Australian Institute of Chartered
Accountants and has been in business for over 20 years, holding senior financial and management positions in both publicly listed
and private enterprises in Australia, Europe and Africa. Mr. Strang has considerable corporate and international expertise and
over the past decade has focused on mining and exploration activities in the oil and gas and natural resources sectors. He is also
a director of Cadence Minerals plc and Gunsynd plc, both listed on AIM, London.
Donald Strang holds 990,500 CDIs and 3million fully vested options over ordinary shares, all of which are exercisable at £0.1918
each up until 28th September 2022.
Directorships held in other listed entities: Cadence Minerals plc and Gunsynd plc, both listed on AIM, London.
Gregory Lee - Executive Director
Mr. Lee is a Petroleum Engineer and has over 30 years of diversified oil and gas experience in both technical and managerial
positions. The main focus of his responsibilities has been on acquisitions and divestments, project management and supervision,
oil and gas field development and operation, production technology and reservoir enhancement, field operations, drilling and
completions activities, exploration, carbon dioxide capture and storage. Mr. Lee also has a very keen interest in renewable and
sustainable energy and best practices. Mr. Lee is a chartered professional engineer (CPEng) and a member of the Society of
Petroleum Engineers (MSPE) and has been an independent petroleum engineer consultant since 1992 having worked with both
large and small organisations (both as operators and non-operators) in numerous countries worldwide. Mr. Lee has been involved
with the listing and management of public listed companies on both AIM and the ASX since 2003.
Gregory Lee holds 86,462 CDIs and 1.5million fully vested options over ordinary shares, all of which are exercisable at £0.1918
each up until 28th September 2022.
Directorships held in other listed entities: None
6
REPORT OF THE DIRECTORS FOR THE YEAR ENDED 31 DECEMBER 2020
DORIEMUS PLC
Jessamyn Lyons - Joint Company Secretary (appointed on 4 December 2019)
Ms Lyons is a Chartered Secretary, an Associate of the Governance Institute of Australia and holds a Bachelor of Commerce from
the University of Western Australia with majors in Investment Finance, Corporate Finance and Marketing. Ms Lyons is also a
Director of Everest Corporate and company secretary of Ragnar Resources limited, Southern Hemisphere Mining Limited,
Dreadnought Resources Limited and Los Cerros Limited. Ms Lyons also has 15 years of experience working in the stockbroking and
banking industries and has held various positions with Macquarie Bank, UBS Investment Bank (London) and more recently
Patersons Securities.
Principal activities and Significant Changes in Nature of Activities
The principal activity of the Group is to invest in and / or acquire companies and / or projects with clear growth potential, focusing
on businesses that are available at attractive valuations and hold opportunities to unlock imbedded value, mainly focusing in the
mining, and oil & gas sectors. There were no significant changes in the nature of activities of the Group during the year.
Operating Results
The net loss after tax of the Group for the year ended 31 December 2020 amounted to AUD950,000 (31 December 2019:
AUD2,886,000).
Dividends Paid or Recommended
No dividends were paid during the year and the Directors do not intend to recommend the payment of a final dividend for the
financial year under review (2019: nil).
Review of Operations and Strategic Report
Please refer to pages 2 to 5 of the Annual Report.
Group Performance and its consequences on shareholder wealth
It is not possible at this time to evaluate the Group’s financial performance using generally accepted measures such as profitability
and total shareholder return as the Group is focussed on exploration activities with no significant revenue stream. This assessment
will be developed as and when the Group moves from explorer to producer.
The table below shows the gross revenue, losses and loss per share for the last five years for the Group:
Revenue and other income
Net loss
Loss per share
2020
-
2019
AUD18
2018
£43
2017
-
2016
£1
AUD950
AUD2,886
£1,745
£2,760
£1,032
’000
’000
Share price at year end
AUD ($)
0.036
0.027
cents/pence
1.64 cents
4.98 cents
3.42p
0.065
7.39p
0.2050
0.01p
n/a
During the year, the Group changed its functional and presentation currency from GBP to AUD. The change has been implemented
with prospective effect. The change of presentation currency is applied retrospectively for comparative figures 31 December 2019.
Key Performance Indicators
Due to the current status of the Group, the Board has not identified any performance indicators as key.
Significant Changes in State of Affairs
There were no significant changes in the state of affairs of the Group during the year.
Significant Events Subsequent to Reporting Date
Events after the end of the reporting period have been fully detailed in Note 20 to the financial statements.
Political Contributions and Charitable Donations
During the current and previous years, the Group did not make any political contributions and charitable donations.
7
REPORT OF THE DIRECTORS FOR THE YEAR ENDED 31 DECEMBER 2020
DORIEMUS PLC
Employee Engagement
Details of how the Directors have engaged with the employees and how the Directors have had regard to employee interests and
the effect of that regard, including on the principal decisions taken by the Company during the financial year, are included in the
Section 172 Statement contained within the Strategic Report.
Business Relationships
Details of the how the Directors have had regard to the need to foster the Company’s business relationships with suppliers,
customers and others and the effect of that regard, including on the principal decisions taken by the Company during the financial
year are included in the Section 172 Statement contained within the Strategic Report.
AGM
This report and financial statements will be presented to shareholders for their approval at the next AGM. The Notice of the AGM
will be distributed to shareholders together with the Annual Report.
Auditors
During the year Chapman Davis LLP tendered its resignation as the Company’s auditors. Following a tender process, the Directors
resolved to appoint Elderton Audit UK, who in turn appointed William Buck Audit (WA) Pty Ltd as the component auditors, to
perform the audit function of the Group. The auditors have indicated their willingness to continue in office and a resolution
concerning their re-appointment will be proposed at the Annual General Meeting.
Financial Risk Management Objectives and Policies
The Group’s principal financial instruments are financial investments, trade receivables, trade payables and cash at bank. The
main purpose of these financial instruments is to fund the Group's operations.
It is, and has been throughout the period under review, the Group’s policy that no trading in financial instruments shall be
undertaken. The main risk arising from the Group’s financial instruments is liquidity risk. The Board reviews and agrees policies
for managing this risk and this is summarised below.
Liquidity Risk
The Group's objective is to maintain a balance between continuity of funding and flexibility through the use of equity and its cash
resources. Further details of this are provided in the principal accounting policies, headed 'going concern'.
Board and Committee Meetings Attendance
Attendance of Directors and Committee members at Board and Committee meetings held during the year is set out in the table
below.
Keith Coughlan
Donald Strang
Gregory Lee
Board Meetings
Audit and Risk
Committee Meetings
Remuneration and
Nomination Committee
Meetings
6
6
6
2
2
2
0
0
0
Indemnifying Officers and Directors and Officers Liability Insurance
The Group has agreed to indemnify the Directors of the Company, against all liabilities to another person that may arise from their
position as Directors of the Company and the Group, except where the liability arises out of conduct involving a lack of good faith.
Appropriate insurance cover is maintained by the Company in respect of its Directors and Officers. During the financial year the
Group agreed to pay an annual insurance premium of $31,722 (2019: $9,642) in respect of Directors’ and Officers’ liability and
legal expenses’ insurance contracts, for Directors, Officers and employees of the Company. The insurance premium relates to:
• costs and expenses incurred by the relevant officers in defending proceedings, whether civil or criminal and whatever the
outcome; and
• other liabilities that may arise from their position, with the exception of conduct involving a wilful breach of duty.
8
REPORT OF THE DIRECTORS FOR THE YEAR ENDED 31 DECEMBER 2020
DORIEMUS PLC
Proceedings on Behalf of Group
No person has applied for leave of Court to bring proceedings on behalf of the Group or intervene in any proceedings to which
the Group is a party for the purpose of taking responsibility on behalf of the Group for all or any part of those proceedings. The
Group was not a party to any such proceedings during the year.
Going Concern
The 31 December 2020 financial report has been prepared on the going concern basis that contemplates the continuity of normal
business activities and the realisation of assets and extinguishment of liabilities in the ordinary course of business. For the year
ended 31 December 2020 the Group recorded a net loss of $950,000 (2019 net loss: $2,886,000) and at 31 December 2020 had a
working capital of $738,000 (31 December 2019: $2,253,000). The Group also recorded a net cash outflow in operating activities
for the year ended 31 December 2020 of $389,000 (2019: $1,590,000).
The Directors have prepared cash flow forecasts for the period ending 31 March 2022 which take account of the current cost and
operational structure of the Group. The cost structure of the Group comprises a high proportion of discretionary spend and
therefore in the event that cash flows become constrained, costs can be quickly reduced to enable the Group to operate within
its available funding. The Group has minimal contractual expenditure commitments and the Board considers the present funds
sufficient to maintain the working capital of the Group for a period of at least 12 months from the date of signing of this report.
The Group may need to raise additional funds to fund any future cash calls to retain its current interest in its investments at their
current level.
The Directors are confident that the Company will be successful in raising additional funds through the issue of new equity, should
the need arise. However, factors beyond the Company’s control, including pandemic diseases such as COVID-19 (coronavirus),
which affect the stock markets, may in turn have a negative impact on any fund raising.
Based on these facts, the Directors consider the going concern basis of preparation to be appropriate for this financial report.
Should the Company be unsuccessful in raising additional funds through the issue of new equity to fund future commitments for
its existing assets, there is a material uncertainty which may cast significant doubt whether the Group will be able to continue as
a going concern and therefore, whether it will realise its assets and extinguish its liabilities in the normal course of business and
at the amounts stated in the financial report.
The financial statements do not include any adjustments relative to the recoverability and classification of recorded asset amounts
or, to the amounts and classification of liabilities that might be necessary should the Group not continue as a going concern.
Unissued Shares under Options
Share options outstanding at the date of this report:
Grant date
Expiry date
Exercise price
11 May 2017
24 May 2017
29 September 2017
29 September 2017
Total options in issue
30 June 2021
30 June 2021
28 September 2021
28 September 2022
£
0.20
0.132
0.1917
0.1917
Outstanding as at
31 December
2020
Number
75,000
1,250,000
2,000,000
11,125,000
14,450,000
Directors’ Remuneration and interests
The Group remunerates the Directors at a level commensurate with the size of the Group and the experience of its Directors. The
Remuneration Committee has reviewed the Directors’ remuneration and believes it upholds the objectives of the Group with
regard to this issue. Details of the Directors’ emoluments and payments made for professional services rendered are set out in
Note 3 to the Financial Statements.
Donald Strang holds 990,500 CDIs and Gregory Lee holds 86,462 CDIs. There was no movement during the financial year.
9
REPORT OF THE DIRECTORS FOR THE YEAR ENDED 31 DECEMBER 2020 (CONTINUED)
Unissued Shares under Options (continued)
DORIEMUS PLC
Donald Strang holds 3million fully vested options over ordinary shares, and Gregory Lee holds 1.5million options (total options
held by Directors is 4.5million), all of which are exercisable at £0.1918 each up until 28th September 2022. There was no movement
during the financial year.
Substantial Shareholdings
The substantial shareholdings in the Company have been fully disclosed in the additional ASX additional disclosures at the end of
the report.
Policy on Payment of Creditors
It is the Group's policy to agree appropriate terms and conditions for its transactions with suppliers by means ranging from
standard terms and conditions to individually negotiated contracts and to pay suppliers according to agreed terms and conditions,
provided that the supplier meets those terms and conditions. The Group does not have a standard or code dealing specifically
with the payment of suppliers.
Trade payables at the year end all relate to sundry administrative overheads and disclosure of the number of days’ purchases
represented by year end payables is therefore not meaningful.
Future Developments
The Group will continue its exploration activities with the objective of finding further resources. The Company will also consider
the acquisition of further prospective exploration interests.
Environmental Issues
The Group operates within the resources sector and conducts its business activities with respect for the environment while
continuing to meet the expectations of shareholders, employees and suppliers. In respect of the current year, the Directors are
not aware of any particular or significant environmental issues which have been raised in relation to the Group’s operations. The
Group holds exploration permits in the UK. The Group’s operations are subject to environmental legislation in this jurisdiction in
relation to its exploration activities.
Website publication
The Directors are responsible for the maintenance and integrity of the Company’s website. Legislation in the United Kingdom
governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.
Statement of disclosure of information to auditors
As at the date of this report the serving Directors confirm that:
•
•
so far as each Director is aware, there is no relevant audit information of which the Company’s auditors are unaware, and
they have taken all the steps that they ought to have taken as Directors in order to make themselves aware of any relevant
audit information and to establish that the Company’s auditor is aware of that information.
Statement of Directors' responsibilities
The Directors are responsible for preparing the Annual Report and financial statements in accordance with applicable law and
regulations.
Company Law requires the Directors to prepare financial statements for each financial year. Under that law the Directors have
prepared the Company financial statements in accordance with International Financial Reporting Standards (IFRSs) as adopted by
the European Union. Under Company Law the Directors must not approve the financial statements unless they are satisfied that
they give a true and fair view of the state of affairs of the Company and of its profit or loss for that period. In preparing these
financial statements, the Directors are required to:
select suitable accounting policies and then apply them consistently;
make judgements and accounting estimates that are reasonable and prudent;
state whether applicable IFRSs as adopted by the European Union have been followed, subject to any material departures
disclosed and explained in the financial statements;
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will
continue in business.
10
REPORT OF THE DIRECTORS FOR THE YEAR ENDED 31 DECEMBER 2020 (CONTINUED)
DORIEMUS PLC
Statement of Directors' responsibilities (continued)
The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company’s
transactions and disclose with reasonable accuracy at any time the financial position of the Company and enable them to ensure
that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the
Company and hence taking reasonable steps for the prevention and detection of fraud and other irregularities.
Responsibility Statement
We confirm that to the best of our knowledge:
the financial statements, prepared in accordance with International Financial Reporting Standards as adopted by the
European Union, give a true and fair view of the assets, liabilities, financial positions and profit or loss of the Company and
the Group and the undertakings included in the consolidation taken as a whole;
the review and operations and strategic report includes a fair review of the development and performance of the business
and the position of the Company and the undertakings included in the consolidation taken as a whole, together with a
description of the principal risks and uncertainties that they face; and
the annual report and financial statements, taken as a whole, are fair, balanced, and understandable and provide the
information necessary for shareholders to assess the Company’s position and performance, business model and strategy.
This responsibility statement and the Directors’ Report was approved by the Board of Directors on 17 March 2021 and is signed
on its behalf by:
Keith Coughlan
Non-Executive Chairman
17 March 2021
11
ELDERTON
AUDIT (UK)
REPORT OF THE INDEPENDENT AUDITOR
PLC
TO THE MEMBERS OF DORIEMUS
Opinion
We have audited
referred
(collectively
and company
consolidated
position,
of financial
company
statements
of significant
accounting
policies.
the financial
statements
of Doriemus
pie ("the Company")
to as "the Group")
for the year ended 31 December
and its subsidiaries
2020, which comprise the
statements
consolidated
of cash flows and the related
income,
of comprehensive
and company statements
of changes
notes to the financial
consolidated
in equity,
statements,
and company
consolidated
a summary
including
statements
and
In our opinion:
- the financial
statements
give a true and fair view of the
as at 31 December
2020 and of the Company's
state of the Company's
and the Group's
and the Group's
for the year then
losses
affairs
ended;
- the Group financial
statements
Standards
have been properly
as adopted
statements
(IFRSs}
prepared
in accordance
by the European Union;
by the European
have been properly
Union;
and
in accordance
have been prepared
Financial
Reporting
- the parent company financial
law and IFRSs as adopted
statements
applicable
- the financial
Companies
Regulation.
Act 2006 and, as regards
the Group financial
with the requirements
of the
4 of the IAS
Article
statements,
prepared
in accordance
with
with International
Basis for opinion
with International
Standards
on Auditing
(UK} (ISAs (UK}} and
our audit in accordance
We conducted
applicable
responsibilities
Group and the Parent
Company
of the financial
Standard
as applied
in accordance
and appropriate
in accordance
in the UK, including
interest
public
with these requirements.
statements
to listed
We believe
a basis for our opinion.
to provide
law. Our responsibilities
for the audit of the financial
under those standards
statements
are further
of our report.
section
with the ethical
in the auditor's
described
of the
We are independent
to our audit
(the 'FRC's')
the Financial Reporting
requirements
that are relevant
Council's
our other ethical
entities,
and we have fulfilled
that the audit evidence
Ethical
responsibilities
is sufficient
we have obtained
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ELDERTON
AUDIT (UK)
Material
uncertainty
related
to going concern
to Note 1 to the financial
report,
is dependent
on being successful
which describes
in raising
that the ability
additional
issues
We draw attention
as a going concern
continue
equity
to the market.
may cast significant
its assets
it will realise
in the financial
stated
As a result,
doubt on the Group's
and extinguish
Our opinion
report.
there is material uncertainty related
to events
ability
to continue
as a going concern,
and therefore
its liabilities
is not modified
in the normal course
of business
in respect
of this matter.
of the Group to
funds through
the
or conditions
that
whether
and at the amounts
Key Audit Matters
are those matters
Statements
misstatement
{whether
effect
Key audit matters
audit of the Financial
material
which had the greatest
directing
of the Financial Statements
separate
of the current
or not due
on: the overall
of the engagement
on these matters.
the efforts
as a whole,
opinion
judgement,
that, in our professional
and include
that we identified.
the most significant
These matters
of resources
in our
of
risks
assessed
those
included
and
in the audit;
period
to fraud)
audit strategy,
were of most significance
team. These matters
and in forming
the allocation
were addressed
thereon,
our opinion
in the context
of our audit
and we do not provide
a
We have determined
report.
the matters
described
below to be key audit matters
to be communicated
in our
assets
Exploration
How our audit addressed
it
holds 5% participating
Doriemus
200km2 onshore Isle of Wright Petroleum
Exploration
and Development
331).
interest
License
{PEDL
As at 31 December
interest
was $421,000.
2020, the carrying
value of the
in a Our audit work
but was not limited
to
the following
included,
procedures:
•Reviewing
existence
assessing
management's
of the
analysis
and
indicators
of impairment
it by:
• verifying
whether
the rights
to tenure
the area of the interest remained current
at balance
remaining duration of
sheet date and verifying the
tenure.
of
As noted in Note 1 {ii) {a} of the financial
report,
' significant
is required
judgement
in determining
that
facts and circumstances
indicate
should
be
assets
and evaluation
with IFRS 6
in accordance
of Mineral
for and Evaluation
accounting
6") and the Group's
whether
the exploration
tested
Exploration
Resources
policy.
for impairment
{"IFRS
of
and obtaining
evidence
for the area of interest
with management
• understanding
intentions
future
from discussions
review
operator
company.
and a
of announcements
of the project,
a UK AIM listed
made by the
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a
had reached
for the area of interest
whether
activities
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ELDERTO
AUDIT (UK)
stage where a reasonable assessment
economically
determined.
recoverable
could be
of
• assessing
related
disclosures.
the appropriateness
of the
Fair value of investments
companies
in unlisted
How our audit addressed it
Doriemus has
through
comprising
interests
investments
ordinary
shares
in an oil and gas projects
companies
in unlisted
• Reviewing
of
management's
estimation
the fair value of the material
and assessing
investments
the:
and loan receivables.
As at 31 December
ordinary
$459,000
the carrying
shares and loan receivables
and $1,005,000
respectively.
value of the
were
• Appropriateness
of the valuation
methodology
used;
As noted in Note l(ii)(b)
required
investments
in determining
significant
is
judgement
of the
the fair value
as they are not quoted in an active
: market.
Our application
of materiality
• Verifying
the inputs
third party
inputs
to the estimation
and market
documentation
to
• Comparing
management's
to
estimation
were
the last price at which the shares
traded
• Reviewing
market
by the majority
investee
of the
share holder
announcements
issued
• Assessing
related
disclosures
the appropriateness
of the
We apply the concept
identified
misstatements
on the audit and in forming our audit opinion.
of materiality
in planning
and performing
the audit,
in evaluating
the effect
of
Materiality
The magnitude
expected
a basis for determining
to influence
of an omission
or misstatement
the economic decisions
that, individually
of the users of the financial
of our audit procedures.
and extent
the nature
or in the aggregate,
statements.
could reasonably
provides
Materiality
be
We determined
2% of the Group's
total assets
for the year ended 31 December
statements
2020.
materiality
for the Group financial
as a whole to be $68,174, which represents
This benchmark
the Board of Directors
is considered
the most appropriate
because
to report
to investors
on the financial
this is a key performance
performance
of the Group.
measure
used by
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ELD RTO
AUDIT (UK)
materiality
Performance
The application
to an appropriately
exceeds
misstatements
materiality.
of materiality
at the individual
account
low level the probability
level.
or balance
that the aggregate
It is set at an amount to reduce
of uncorrected
and undetected
On the basis of our risk assessments,
environment
and to drive the extent
for the audit of the Group financial
certain
statements.
remuneration
together
of our testing,
areas such as Directors'
with our assessment
performance
We also determine
of the Group's
overall
was 75% of our materiality
control
materiality
a lower level of specific
materiality
for
and related
party transactions.
Reporting
An amount below which identified
threshold
misstatements
are considered
as being clearly
trivial.
We agreed with the Board that we would report
differences
below that threshold
report
presentation
to the Audit Committee
of the financial
statements
that, in our view, warranted
on disclosure
matters
all audit differences
reporting
in excess
on qualitative grounds.
of $3,409 ,
as well as
that we identified
when assessing
We also
the overall
Other information
The Directors
included
opinion
otherwise
are responsible
in the annual
report,
on the financial
stated
explicitly
statements
in our report,
for the other information.
other than the financial
The other information
statements
and our Auditors'
the information
Our
Report thereon.
comprises
does not cover the other information
we do not express
any form of assurance
and, except to the extent
thereon.
conclusion
with our audit ofthe financial
whether
statements,
the other information
in the audit or otherwise
is materially
appears
or our knowledge
obtained
our responsibility
In connection
and, in doing so, consider
statements
identify
whether
other information.
misstatement
such material
there is a material
or apparent
inconsistencies
material
misstatement
in the financial
If, based on the work we have performed,
of this other information,
we are required
to report
is to read the other information
inconsistent
to be materially
we are required
with the financial
If we
to determine
of the
misstated.
misstatement
that there is a material
misstatements,
or a material
statements
we conclude
that fact.
We have nothing
to report
in this regard.
Overview of the scope of our audit
Council's
of the generic
A description
website
Reporting
Standards
with International
standards
of our report.
are further
described
scope of an audit of financial
statements
is provided
at www.frc.org.uk/auditscopeprivate
(UK and Ireland).
on Auditing
in the 'Responsibilities
under those
for the financial statements
Our responsibilities
section
and the audit'
. We conducted
(ISAs)
on the Financial
our audit in accordance
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ELDERTON
AUDIT (UK)
We believe
our opinion.
Standards
Ethical
that the audit evidence
We are independent
for auditors, and
we have fulfilled
we have obtained
Standards.
of the Group in accordance
with the Auditing
is sufficient
and appropriate
a basis for
to provide
Practices
Board's
in accordance
Ethical
our other ethical
responsibilities
with those
in the United
The Group has operations
from Australia.
operates
audit approach.
is risk based,
and in particular
Through
Our audit approach
included:
Kingdom
our procedures,
and are managed
all Group entities
by the Group's
were subjected
was based on a thorough
understanding
of the Group's
management,
which
to a comprehensive
and
business
control
internal
of the design
the Group's
to evaluate
procedures
and controls;
an evaluation
undertaking
systems
performing
identified
as part of our risk assessment
audit visit,
at the final
the extent
disclosures,
environment,
the control
risk.
of specific
management
effectiveness
and, reviewed
testing
substantive
we undertook
of which was based on various
the effectiveness
the accounts
on significant
factors
of controls
over key financial
statement
and
production
process;
and
balances
transactions,
assessment
of
and the
such as our overall
over individual
environment,
IT
including
of controls
systems
risk
Opinion
on Other Matters
prescribed
by the Companies
Act 2006
on other matters
Our opinion
part of the Directors'
the Companies
Act 2006.
prescribed
Report
Remuneration
by the Companies
to be audited
Act 2006 are unmodified.
In our opinion,
in accordance
the
with
has been properly
prepared
In our opinion,
based on the work undertaken
in the course
of the audit:
for the financial
given in the Report
the information
statements
the Report
are prepared
of the Directors
is consistent
has been prepared
of the Directors
with the financial
statements;
year for which the financial
and
in accordance
of the Group and Parent
legal
and its environment
of the
in the Report
material misstatements
with applicable
Company
requirements.
in the course
of the audit,
we have not identified
of the knowledge
and understanding
In the light
obtained
Directors.
Matters
on which we are required
to report by exception
Act 2006 we are required
Under the Companies
accounting
adequate
our audit have not been received
financial
in agreement
of Directors' remuneration specified
to report
have not been kept by the parent
by us; or
not visited
and the part of the Directors'
or
and returns;
company
are not
to you if, in our opinion:
with the accounting
to
Report
Remuneration
- the parent
disclosures
from branches
statements
adequate
company,
or returns
records
records
for
all the information
and explanations
for our audit.
by law are not made; or
we require
be audited
certain
we have not received
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ELDERTO
AUDIT (UK)
we are required
to report
to you if, in our opinion,
information
in the
Under the ISAs {UK and Ireland),
annual
report
is:
materially inconsistent
apparently
Group acquired
otherwise
materially
in the course
misleading.
with the information
incorrect
of performing
based on, or materially
our audit; or
in the audited
or
statements;
financial
of the
with, our knowledge
inconsistent
In particular,
we are required
to report
to you if:
any inconsistencies
between
acquired
during
the audit and the
that they consider
our knowledge
is fair,
the annual report
balanced
and understandable;
we have identified
statement
Directors'
or
the annual
Audit Committee
report
does not appropriately
which we consider
those matters
have been disclosed.
disclose
should
that were communicated
to the
We have nothing
to report
in respect
of any of the above matters.
We also confirm
to add or to draw
attention
to in relation
to:
that they have carried
those that would threaten
out a robust
assessment
model,
its business
that we do not have anything
in the annual
confirmation
the Group including
material
report
solvency
or liquidity;
- the Directors'
of the principal
future
the disclosures
managed
risks facing
performance,
or mitigated;
in the annual report that describe
those risks and explain
how they are being
statement
- the Directors'
appropriate
identification
period
of at least twelve
to adopt the going concern
of any material
in the financial
statements
about whether
basis of accounting
uncertainties
ability
to the Group's
months from the date of approval
report
they have considered
them, and their
to do so over a
and
statements;
the prospects
in preparing
to continue
in the annual
- the Directors'
explanation
it
of the financial
as to how they have assessed
that period
expectation
of the
to be appropriate,
as to whether
they have a reasonable
that the Group will be able
they have done so and why they consider
in operation
including
and meet its liabilities
disclosures
any related
drawing
as they fall due over the period of their
attention
to any necessary
qualifications
Group,
over what period
and their statement
to continue
assessment,
or assumptions.
Responsibilities
for the financial
statements
and the audit
What the Directors
As explained
more fully
the preparation
are responsible
for:
in the Statement of
the Directors
Responsibilities,
are responsible
for
of the financial
statements
that they give a true and fair view.
Directors'
and for being satisfied
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LDERTON
AUDIT (UK)
for:
What we are responsible
Our responsibility
applicable
comply with
is to audit and express
Standards
law and International
Board's
the Auditing Practices
an opinion
on the financial
on Auditing
(UK and Ireland).
for Auditors.
Ethical Standards
statements
Those standards
with
in accordance
us to
require
Other matters
The financial statements
auditor
of Doriemus
an unmodified
pie for the year ended
opinion
who expressed
on those financial
2019 were audited
on 27 March 2020.
statements
31 December
by another
Use of our report
This report is made solely
of the Companies
members
To the fullest
the Company and the Company's
we have formed.
opinions
those matters
extent
permitted
to the Company's members,
Act 2006. Our audit work has been undertaken
as a body, in accordance
we are required
by law, we do not accept
to state to them in an auditor's report
or assume responsibility
members as a body, for our audit work, for this report,
or for the
with Chapter
so that we might state to the Company's
and for no other purpose.
to anyone other than
3 of Part 16
HOLLENS
NICHOLAS
Senior
Statutory
Perth,
17 March 2021
Statutory
Auditor,
Australia
Auditor
for and on behalf
of Elderton
Audit UK
Chartered
Accountants
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18
FINANCIAL STATEMENTS
DORIEMUS PLC
Consolidated Statement of Profit or Loss and Other Comprehensive Income
for the year ended 31 December 2020
Revenue
Cost of sales
Gross loss
Administrative expenses
Legal fees
Staff costs
Creditors written off
Exploration costs written-off
Depletion and Impairment charges
Loss from operations
Loan Interest received
Realised (loss)/gain on financial investments
Unrealised loss on financial investments and trade and
other receivables
Loss before income tax
Income tax expense
Loss attributable to the owners of the company
and total comprehensive income for the year
Other comprehensive income
Exchange differences on translation of foreign operations
Other comprehensive income for the year net of taxation
Total comprehensive income for the period attributable to
equity
holders of the company
Earnings per share
Basic loss per share (cents)
Diluted loss per share (cents)
Note
2
17
8 & 10
4
5
6
6
2020
AUD’000
Restated
2019
AUD’000
-
(12)
(12)
(233)
(259)
(167)
181
-
(352)
(842)
19
(49)
(78)
18
(193)
(175)
(555)
(121)
(501)
-
(1,447)
(338)
(3,137)
88
222
(59)
(950)
(2,886)
-
-
(950)
(2,886)
8
8
145
145
(942)
(2,741)
(1.64)
(1.64)
(4.98)
(3.98)
The notes form an integral part of these financial statements.
19
Company Statement of Profit or Loss and Other Comprehensive Income
for the year ended 31 December 2020
DORIEMUS PLC
Revenue
Cost of sales
Gross loss
Administrative expenses
Legal fees
Staff costs
Exploration costs written-off
Depletion and impairment charges
Creditors written off
Note
2
8, 10 & 18
17
2020
AUD’000
Restated
2019
AUD’000
-
-
-
(244)
(259)
(67)
-
(861)
181
18
(193)
(175)
(279)
(121)
(389)
(1,447)
(338)
-
Loss from operations
4
(1,250)
(2,749)
Loan Interest received
Realised (loss)/gain on financial investments
Unrealised loss on financial investments and trade and other
receivables
Loss before income tax
Income tax expense
Loss attributable to the owners of the company
and total comprehensive income for the year
Other comprehensive income
Other comprehensive income
Other comprehensive income for the year net of taxation
Total comprehensive loss for the year attributable to equity
holders of the company
Loss per share
Basic loss per share (cents)
Diluted loss per share (cents)
19
(49)
(78)
88
222
(59)
(1,358)
(2,498)
5
-
-
(1,358)
(2,498)
-
-
-
-
(1,358)
(2,498)
6
6
(2.34)
(2.34)
(4.31)
(3.44)
The notes form an integral part of these financial statements.
20
Consolidated Statement of Changes in Equity
for the year ended 31 December 2020
DORIEMUS PLC
Share
capital
Share
premium
AUD’000
AUD’000
Share
based
payment
reserve
AUD’000
Foreign
exchange
reserve
Accumulated
losses
Total
AUD’000
AUD’000
AUD’000
At 31 December 2018
411
14,162
2,984
Loss for the year
Other comprehensive income
Total comprehensive loss for the year
-
-
-
-
-
-
-
-
-
At 31 December 2019
411
14,162
2,984
Loss for the year
Currency translation differences
Total comprehensive loss for the year
-
-
-
-
-
-
-
-
-
165
-
145
145
310
-
8
8
(11,415)
6,307
(2,886)
-
(2,886)
(2,886)
145
(2,741)
(14,301)
3,566
(950)
-
(950)
(950)
8
(942)
At 31 December 2020
411
14,162
2,984
318
(15,251)
2,624
The notes form an integral part of these financial statements.
21
Company Statement of Changes in Equity
for the year ended 31 December 2020
DORIEMUS PLC
Share capital
Share
premium
Share based
payment
reserve
Accumulated
losses
Total
AUD’000
AUD’000
AUD’000
AUD’000
AUD’000
At 31 December 2018
411
14,162
2,984
(11,089)
6,468
Loss for the year
Other comprehensive income
Total comprehensive loss for the year
-
-
-
-
-
-
-
-
-
(2,498)
-
(2,498)
(2,498)
-
(2,498)
At 31 December 2019
411
14,162
2,984
(13,587)
3,970
Loss for the year
Total comprehensive loss for the year
-
-
-
-
-
-
(1,358)
(1,358)
(1,358)
(1,358)
At 31 December 2020
411
14,162
2,984
(14,945)
2,612
The notes form an integral part of these financial statements.
22
Consolidated Statement of Financial Position
at 31 December 2020
DORIEMUS PLC
Assets
Non-current assets
Intangible assets
Oil & gas properties
Financial investments
Trade and other receivables
Total non-current assets
Current assets
Trade and other receivables
Cash and cash equivalents
Total current assets
Total assets
Liabilities
Current liabilities
Liabilities held for sale
Trade and other payables
Total current liabilities
Total liabilities
Net assets
Equity attributable to owners
of the parent
Share capital
Share premium account
Share based payment reserve
Foreign exchange reserve
Retained earnings
Total equity
Note
2020
AUD’000
Restated
2019
AUD’000
7
8
10
12
12
13
9
14
15
422
-
459
1,005
1,886
8
1,229
1,237
3,123
457
42
499
499
2,624
422
94
797
-
1,313
1,701
1,712
3,413
4,726
-
1,160
1,160
1,160
3,566
411
14,162
2,984
318
(15,251)
411
14,162
2,984
310
(14,301)
2,624
3,566
The financial statements were approved by the Board of Directors and authorised for issue on 17 March 2021.
Keith Coughlan
Non-Executive Chairman
Company registered number 03877125
Gregory Lee
Executive Director
The notes form an integral part of these financial statements.
23
Company Statement of Financial Position
at 31 December 2020
DORIEMUS PLC
Assets
Non-current assets
Intangible assets
Oil & gas properties
Financial investments
Trade and other receivables
Total non-current assets
Current assets
Trade and other receivables
Cash and cash equivalents
Total current assets
Total assets
Liabilities
Current liabilities
Liabilities held for sale
Trade and other payables
Total current liabilities
Total liabilities
Net assets
Equity attributable to owners
of the parent
Share capital
Share premium account
Share based payment reserve
Retained earnings
Total equity
Note
2020
AUD’000
Restated
2019
AUD’000
7
8
10
12
12
13
9
14
15
422
-
459
1,005
1,886
3
1,222
1,225
3,111
457
42
499
499
2,612
422
94
797
-
1,313
2,130
1,678
3,808
5,121
-
1,151
1,151
1,151
3,970
411
14,162
2,984
(14,945)
411
14,162
2,984
(13,587)
2,612
3,970
The financial statements were approved by the Board of Directors and authorised for issue on 17 March 2021.
Keith Coughlan
Non-Executive Chairman
Company registered number 03877125
Gregory Lee
Executive Director
The notes form an integral part of these financial statements.
24
Consolidated Statement of Cash Flows
for the year ended 31 December 2020
DORIEMUS PLC
Note
2020
AUD’000
Cash flows from operating activities
(Loss) from operations
Adjustments for:
Impairment charge
Creditors written off
Exploration costs written-off
Increase/(decrease) in trade and other receivables
(Decrease)/increase in trade and other payables
Net cash (outflow) from operating activities
Cash flows from investing activities
Payments for intangible assets/OGPs
Loans advanced to related parties
Receipts on sale of AFS investments
Net cash inflow from investing activities
Net (decrease)/increase in cash and cash equivalents
Foreign exchange differences adjustments
Cash and cash equivalents at beginning of year
Cash and cash equivalents at the end of year
Cash and cash equivalents comprise:
Bank & cash available on demand
Restated
2019
AUD’000
(3,137)
338
-
1,447
(277)
39
(1,590)
(79)
(284)
3,315
2,952
1,362
(26)
376
1,712
(842)
352
(181)
-
668
(386)
(389)
-
-
13
13
(376)
(107)
1,712
1,229
13
1,229
1,712
The notes form an integral part of these financial statements.
25
Company Statement of Cash Flows
for the year ended 31 December 2020
DORIEMUS PLC
Note
2020
AUD’000
Cash flows from operating activities
(Loss) from operations
Adjustments for:
Depletion and impairment charge
Creditors written off
Exploration costs written-off
Decrease/(increase) in trade and other receivables
(Decrease)/increase in trade and other payables
Net cash (outflow) from operating activities
Cash flows from investing activities
Payments for intangible assets/OGPs
Loans advanced to related parties
Receipts on sale of AFS investments
Net cash inflow from investing activities
Net (decrease)/increase in cash and cash equivalents
Foreign exchange differences adjustments
Cash, cash equivalents and bank overdrafts at beginning of year
Cash and cash equivalents at the end of year
Cash and cash equivalents comprise:
Bank & cash available on demand
Restated
2019
AUD’000
(2,749)
338
-
1,447
(283)
13
(1,234)
(79)
(716)
3,315
2,520
1,286
-
392
1,678
(1,250)
861
(181)
-
478
(270)
(362)
-
-
13
13
(349)
(107)
1,678
1,222
13
1,222
1,678
The notes form an integral part of these financial statements.
26
DORIEMUS PLC
Notes forming part of the financial statements
for the year ended 31 December 2020
1
Accounting policies
Background information
Doriemus plc is incorporated and domiciled in the jurisdiction of England and Wales. The address of Doriemus plc’s registered
office is c/o Hill Dickinson, The Broadgate Tower, 20 Primrose Street, London ECRA 2EW which is also the Company’s principal
place of business. Doriemus plc’s shares in the form of CHESS Depositary Interests are listed on the Australian Securities Exchange
(“ASX”).
These Financial Statements (the "Financial Statements") have been prepared and approved by the Directors on 17 March 2021
and signed on their behalf by Gregory Lee and Keith Coughlan.
Principal
The principal activity of the Group is to invest in and / or acquire companies and / or projects with clear growth potential, focusing
on businesses that are available at attractive valuations and hold opportunities to unlock imbedded value, mainly focusing in the
mining, and oil & gas sectors. There were no significant changes in the nature of activities of the Group during the year.
Basis of preparation
The principal accounting policies adopted in the preparation of the financial statements are set out below. The policies have been
consistently applied to the Company through all the years presented, unless otherwise stated. These financial statements have
been prepared in accordance with International Financial Reporting Standards, International Accounting Standards and EU
adopted IFRICs (collectively IFRS) issued by the International Accounting Standards Board (IASB) as adopted by European Union
("adopted IFRSs"), and in accordance with those parts of the Companies Act 2006 applicable to those companies preparing their
accounts under IFRS. The financial statements have been prepared under the historical cost convention and presented in AUD
thousands (AUD’000).
Going concern
The 31 December 2020 financial report has been prepared on the going concern basis that contemplates the continuity of normal
business activities and the realisation of assets and extinguishment of liabilities in the ordinary course of business. For the year
ended 31 December 2020 the Group recorded a net loss of $950,000 (2019 net loss: $2,886,000) and at 31 December 2020 had a
positive working capital of $738,000 (31 December 2019: $2,253,000). The Group also recorded a net cash outflow in operating
activities for the year ended 31 December 2020 of $389,000 (2019: $1,590,000).
The Directors have prepared cash flow forecasts for the period ending 31 March 2022 which take account of the current cost and
operational structure of the Group. The cost structure of the Group comprises a high proportion of discretionary spend and
therefore in the event that cash flows become constrained, costs can be quickly reduced to enable the Group to operate within
its available funding. The Group has minimal contractual expenditure commitments and the Board considers the present funds
sufficient to maintain the working capital of the Group for a period of at least 12 months from the date of signing of this report.
The Group may need to raise additional funds to fund any future cash calls to retain its current interest in its investments at their
current level.
The Directors are confident that the Company will be successful in raising additional funds through the issue of new equity, should
the need arise. However, factors beyond the Company’s control, including pandemic diseases such as COVID-19 (coronavirus),
which affect the stock markets, may in turn have a negative impact on any fund raising.
Based on these facts, the Directors consider the going concern basis of preparation to be appropriate for this financial report.
Should the Company be unsuccessful in raising additional funds through the issue of new equity to fund future commitments for
its existing assets, there is a material uncertainty which may cast significant doubt whether the Group will be able to continue as
a going concern and therefore, whether it will realise its assets and extinguish its liabilities in the normal course of business and
at the amounts stated in the financial report.
The financial statements do not include any adjustments relative to the recoverability and classification of recorded asset amounts
or, to the amounts and classification of liabilities that might be necessary should the Group not continue as a going concern.
27
DORIEMUS PLC
Notes forming part of the financial statements
for the year ended 31 December 2020 (continued)
1
Accounting policies (continued)
New standards, amendments and interpretations adopted by the Company
No new and/or revised Standards and Interpretations have been required to be adopted, and/or are applicable in the current
year by/to the Group, as standards, amendments and interpretations which are effective for the financial year beginning on 1
January 2020 are not material to the Group.
Restatement from change of functional and presentation currency:
The financial statements are presented in Australian Dollars (AUD), which is the functional currency of the Company from January
1, 2020. The change was made to reflect that AUD has become the predominant currency in the Company, counting for a
significant part of the Company’s cash flow, cash flow management and financing. The change has been implemented with
prospective effect. The change of presentation currency is applied retrospectively for comparative figures 31 December 2019.
Currency translation effects for the comparative figures from functional currency to presentation currency AUD in 2019 are
booked as translation differences towards equity. Comparison figures in the statement of comprehensive income, statement of
changes in equity and statement of cash flows have been re-presented to reflect the currency rates of transactions in foreign
currencies at the date of the transactions. The re-presentation of the statement of cash flow impacts the classification between
currency translation adjustments and other components of cash flow.
New standards, amendments and interpretations not yet adopted
There are no other IFRSs or IFRIC interpretations that are not yet effective that would be expected to have a material impact on
the Group.
Basis of consolidation
Subsidiaries are entities controlled by the Group. The financial statements of the subsidiaries are prepared for the same reporting
period as the parent company, using consistent accounting policies.
Control, under IFRS10, is achieved when the Company:
• has power over the investee;
• is exposed, or has rights, to variable returns from its involvement with the investee; and
• has the ability to use its power to affect its returns.
The Company reassesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one
or more of the three elements of control listed above. Subsidiaries are fully consolidated from the date on which control is
transferred to the Group and cease to be consolidated from the date on which control is transferred out of the Group.
In preparing the consolidated financial statements, all intercompany balances and transactions, income and expenses and profit
and losses resulting from intra-Group transactions have been eliminated in full. The acquisition of subsidiaries has been accounted
for using the purchase method of accounting. The purchase method of accounting involves allocating the cost of the business
combination to the fair value of the assets acquired and the liabilities and contingent liabilities assumed at the date of acquisition.
Accordingly, the consolidated financial statements include the results of subsidiaries for the period from their acquisition.
Non-controlling interests represent the portion of profit or loss and net assets in subsidiaries not held by the Group and are
presented separately in the consolidated statement of profit or loss and other comprehensive income and within equity in the
consolidated statement of financial position. In the Company’s financial statements, investments in subsidiaries are carried at
cost.
Foreign currency transactions and balances
Transactions in foreign currencies are initially recorded in the functional currency at the exchange rates ruling at the date of the
transaction. Monetary assets and liabilities denominated in foreign currencies are retranslated at the rate of exchange ruling at
the reporting date. All differences in the consolidated financial report are taken to the Statement of Profit or Loss and Other
Comprehensive Income.
All differences in the consolidated financial report are taken to the Statement of Profit or Loss and Other Comprehensive Income.
Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rate as
at the date of the initial transaction. Non-monetary items measured at fair value in a foreign currency are translated using the
exchange rate at the date the fair value was determined.
28
DORIEMUS PLC
Notes forming part of the financial statements
for the year ended 31 December 2020 (continued)
1
Accounting policies (continued)
Revenue
Revenue from the production of oil, in which the Group has an interest with other producers, is recognised based on the Group’s
working interest and the terms of the relevant production sharing contracts. Differences between oil lifted and sold and the
Group’s share of production are not significant.
Expenses
Expenses are recognised in the period when obligations are incurred.
Financial assets
The Group classifies its financial assets into categories as set out below, depending on the purpose for which the asset was
acquired.
Cash and cash equivalents
Includes cash in 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 loans and borrowings in current liabilities on the statement
of financial position.
Trade and other receivables
Trade and other receivables are initially measured at fair value plus any direct attributable transaction costs. Subsequent to initial
recognition, trade and other receivables are measured at amortised cost using the effective interest method, less any impairment
losses.
Trade receivables are held in order to collect the contractual cash flows and are initially measured at the transaction price as
defined in IFRS 15, as the contracts of the Group do not contain significant financing components. Impairment losses are
recognised based on lifetime expected credit losses in profit or loss.
Other receivables are held in order to collect the contractual cash flows and accordingly are measured at initial recognition at fair
value, which ordinarily equates to cost and are subsequently measured at cost less impairment due to their short term nature. A
provision for impairment is established based on 12-month expected credit losses unless there has been a significant increase in
credit risk when lifetime expected credit losses are recognised. The amount of any provision is recognised in profit or loss.
Financial liabilities
The Group classifies its financial liabilities into one of the following categories, depending on the purpose for which the liability
was acquired:
-
-
-
Trade payables and other short-term monetary liabilities, which are initially recognised at fair value and subsequently carried
at amortised cost using the effective interest method
Bank and other borrowings are initially recognised at fair value net of any transaction costs directly attributable to the issue
of the instrument.
Income received in advance is recorded as deferred income on the balance sheet.
Share capital
Financial instruments issued by the Company are treated as equity only to the extent that they do not meet the definition of a
financial liability. The Company’s ordinary and deferred shares are classified as equity instruments.
29
DORIEMUS PLC
Notes forming part of the financial statements
for the year ended 31 December 2020 (continued)
Reserves
Share capital is the amount subscribed for ordinary shares at nominal value.
Retained earnings / accumulated losses represent cumulative gains and losses of the Company attributable to equity shareholders.
Share based payment reserve represents the value of equity benefits provided to employees and Directors as part of their
remuneration and provided to consultants and advisors hired by the Group from time to time as part of the consideration paid.
Investments in joint arrangements
Joint arrangements represent the contractual sharing of control between parties in a business venture where unanimous decisions
about relevant activities are required. Separate joint venture entities providing joint ventures with an interest to net assets are
classified as a joint venture and accounted for using the equity method.
Joint operations represent arrangements whereby joint operators maintain direct interests in each asset and exposure to each
liability of the arrangement. The Group’s interests in assets, liabilities, revenue and expenses of joint operations are included in
the respective line items of the consolidated financial statements. Gains and losses resulting from sales to a joint operation are
recognised to the extent of the other parties’ interests. When the Group makes purchases from a joint operation, it does not
recognise its share of the gains and losses from the joint arrangement until it resells those goods/assets to a third party.
Intangible assets – Exploration of mineral resources
Acquired intangible assets, which consist of mining rights, are valued at cost less accumulated amortisation.
The Group applies the full cost method of accounting for exploration and evaluation costs, having regard to the requirements of
IFRS 6 'Exploration for and Evaluation of Mineral Resources'. All costs associated with mining development and investment are
capitalised on a project by project basis pending determination of the feasibility of the project. Such expenditure comprises
appropriate technical and administrative expenses but not general overheads.
Such exploration and evaluation costs are capitalised provided that the Company's rights to tenure are current and one of the
following conditions is met:
(i)
(ii)
such costs are expected to be recouped through successful development and exploitation of the area of interest or
alternatively by its sale; or
the activities have not reached a stage which permits a reasonable assessment of whether or not economically recoverable
resources exist; or
(iii) active and significant operations in relation to the area are continuing.
When an area of interest is abandoned, or the Directors decide that it is not commercial, any exploration and evaluation costs
previously capitalised in respect of that area are written off to profit or loss.
Amortisation does not take place until production commences in these areas. Once production commences, amortisation is
calculated on the unit of production method, over the remaining life of the mine. Impairment assessments are carried out
regularly by the Directors. Exploration and evaluation assets are assessed for impairment when facts and circumstances suggest
that the carrying amount may exceed its recoverable amount. Such indicators include the point at which a determination is made
as to whether or not commercial reserves exist.
The asset's residual value and useful lives are reviewed and adjusted if appropriate, at each reporting date. An assets' carrying
value is written down immediately to its recoverable value if the assets carrying amount is greater than its listed recoverable
amount.
30
DORIEMUS PLC
Notes forming part of the financial statements
for the year ended 31 December 2020 (continued)
1
Accounting policies (continued)
Oil and gas properties and other property, plant and equipment
(i) Initial recognition
Oil and gas properties and other property, plant and equipment are stated at cost, less accumulated depreciation and accumulated
impairment losses.
The initial cost of an asset comprises its purchase price or construction cost, any costs directly attributable to bringing the asset
into operation, the initial estimate of the decommissioning obligation and, for qualifying assets (where relevant), borrowing costs.
The purchase price or construction cost is the aggregate amount paid and the fair value of any other consideration given to acquire
the asset. The capitalised value of a finance lease is also included within property, plant and equipment.
When a development project moves into the production stage, the capitalisation of certain construction/development costs
ceases, and costs are either regarded as part of the cost of inventory or expensed, except for costs which qualify for capitalisation
relating to oil and gas property asset additions, improvements or new developments.
(ii) Depreciation/amortisation
Oil and gas properties are depreciated/amortised on a unit-of-production basis over the total proved developed and undeveloped
reserves of the field concerned, except in the case of assets whose useful life is shorter than the lifetime of the field, in which case
the straight-line method is applied. Rights and concessions are depleted on the unit-of-production basis over the total proved
developed and undeveloped reserves of the relevant area.
The unit-of-production rate calculation for the depreciation/amortisation of field development costs takes into account
expenditures incurred to date, together with sanctioned future development expenditure. An item of property, plant and
equipment and any significant part initially recognised is derecognised upon disposal or when no future economic benefits are
expected from its use or disposal. Any gain or loss arising on derecognition of the asset (calculated as the difference between the
net disposal proceeds and the carrying amount of the asset) is included in the statement of profit or loss and other comprehensive
income when the asset is derecognised.
The asset’s residual values, useful lives and methods of depreciation/amortisation are reviewed at each reporting period and
adjusted prospectively, if appropriate.
(ii) Major maintenance, inspection and repairs
Expenditure on major maintenance refits, inspections or repairs comprises the cost of replacement assets or parts of assets,
inspection costs and overhaul costs. Where an asset, or part of an asset that was separately depreciated and is now written off is
replaced and it is probable that future economic benefits associated with the item will flow to the Group, the expenditure is
capitalised. Where part of the asset replaced was not separately considered as a component and therefore not depreciated
separately, the replacement value is used to estimate the carrying amount of the replaced asset(s) and is immediately written off.
Inspection costs associated with major maintenance programmes are capitalised and amortised over the period to the next
inspection. All other day-to-day repairs and maintenance costs are expensed as incurred.
Assets held for sale
Non-current assets are classified as held-for-sale if it is highly probable that they will be recovered through sale rather than
continuing use.
Immediately before classification as held-for-sale, the assets are remeasured in accordance with the Group’s other accounting
policies. Thereafter generally the assets are measured at the lower of their carrying amount and fair value less costs to sell.
Impairment losses on initial classification as held-for-sale and subsequent gains or losses on remeasurement are recognised in
profit or loss.
31
DORIEMUS PLC
Notes forming part of the financial statements
for the year ended 31 December 2020 (continued)
1
Accounting policies (continued)
Provision for rehabilitation / Decommissioning Liability
The Group recognises a decommissioning liability where it has a present legal or constructive obligation as a result of past events,
and it is probable that an outflow of resources will be required to settle the obligation, and a reliable estimate of the amount of
obligation can be made.
The obligation generally arises when the asset is installed, or the ground/environment is disturbed at the field location. When the
liability is initially recognised, the present value of the estimated costs is capitalised by increasing the carrying amount of the
related oil and gas assets to the extent that it was incurred by the development/construction of the field. Any decommissioning
obligations that arise through the production of inventory are expensed when the inventory item is recognised in cost of goods
sold.
Changes in the estimated timing or cost of decommissioning are dealt with prospectively by recording an adjustment to the
provision and a corresponding adjustment to oil and gas assets.
Any reduction in the decommissioning liability and, therefore, any deduction from the asset to which it relates, may not exceed
the carrying amount of that asset. If it does, any excess over the carrying value is taken immediately to the statement of profit or
loss and other comprehensive income.
If the change in estimate results in an increase in the decommissioning liability and, therefore, an addition to the carrying value
of the asset, the Group considers whether this is an indication of impairment of the asset as a whole, and if so, tests for impairment.
If, for mature fields, the estimate for the revised value of oil and gas assets net of decommissioning provisions exceeds the
recoverable value, that portion of the increase is charged directly to expense. Over time, the discounted liability is increased for
the change in present value based on the discount rate that reflects current market assessments and the risks specific to the
liability. The periodic unwinding of the discount is recognised in the statement of profit or loss and other comprehensive income
as a finance cost. The Group recognises neither the deferred tax asset in respect of the temporary difference on the
decommissioning liability nor the corresponding deferred tax liability in respect of the temporary difference on a decommissioning
asset.
Significant accounting judgements, estimates and assumptions
The preparation of the Group’s financial statements requires management to make judgements, estimates and assumptions that
affect the reported amounts of revenues, expenses, assets and liabilities, and the accompanying disclosures, and the disclosure
of contingent liabilities at the date of the consolidated financial statements. Estimates and assumptions are continuously
evaluated and are based on management’s experience and other factors, including expectations of future events that are believed
to be reasonable under the circumstances. Uncertainty about these assumptions and estimates could result in outcomes that
require a material adjustment to the carrying amount of assets or liabilities affected in future periods.
In particular, the Group has identified the following areas where significant judgements, estimates and assumptions are required.
Further information on each of these areas and how they impact the various accounting policies are described below and also in
the relevant notes to the financial statements. Changes in estimates are accounted for prospectively.
Judgements
(i)
In the process of applying the Group’s accounting policies, management has made the following judgements, which have the most
significant effect on the amounts recognised in the financial statements:
(a) Contingencies
Contingent liabilities may arise from the ordinary course of business in relation to claims against the Group, including legal,
contractor, land access and other claims. By their nature, contingencies will be resolved only when one or more uncertain future
events occur or fail to occur. The assessment of the existence, and potential quantum, of contingencies inherently involves the
exercise of significant judgement and the use of estimates regarding the outcome of future events.
32
DORIEMUS PLC
Notes forming part of the financial statements
for the year ended 31 December 2020 (continued)
1
Accounting policies (continued)
(ii) Estimates and assumptions
The key assumptions concerning the future and other key sources of estimation uncertainty at the reporting date that have a
significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year, are
described below. The Group based its assumptions and estimates on parameters available when the financial statements were
prepared. Existing circumstances and assumptions about future developments, however, may change due to market change or
circumstances arising beyond the control of the Group. Such changes are reflected in the assumptions when they occur.
Exploration and evaluation expenditures
(a)
The application of the Group’s accounting policy for exploration and evaluation expenditure requires judgement to determine
whether future economic benefits are likely, from future either exploitation or sale, or whether activities have not reached a stage
which permits a reasonable assessment of the existence of reserves. The determination of reserves and resources is itself an
estimation process that involves varying degrees of uncertainty depending on how the resources are classified. These estimates
directly impact when the Group defers exploration and evaluation expenditure. The deferral policy requires management to make
certain estimates and assumptions about future events and circumstances, in particular, whether an economically viable
extraction operation can be established. Any such estimates and assumptions may change as new information becomes available.
If, after expenditure is capitalised, information becomes available suggesting that the recovery of the expenditure is unlikely, the
relevant capitalised amount is written off in the statement of profit or loss and other comprehensive income in the period when
the new information becomes available.
Fair value measurement
(b)
The Group measures financial instruments, such as equity investments and non-trade receivables, at fair value at each balance
sheet date. From time to time, the fair values of non-financial assets and liabilities are required to be determined, e.g., when the
entity acquires a business, or where an entity measures the recoverable amount of an asset or cash-generating unit (CGU) at
FVLCD.
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market
participants at the measurement date.
The fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the
asset or liability, assuming that market participants act in their economic best interest.
A fair value measurement of a non-financial asset takes into account a market participant's ability to generate economic benefits
by using the asset in its highest and best use or by selling it to another market participant that would use the asset in its highest
and best use.
The Group uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to
measure fair value, maximising the use of relevant observable inputs and minimising the use of unobservable inputs. From time
to time external valuers are used to assess FVLCD of the Company’s non-financial assets. Involvement of external valuers is
decided upon by the Valuation Committee after discussion with and approval by the Company’s Directors. Selection criteria
include market knowledge, reputation, independence and whether professional standards are maintained. Valuers are normally
rotated every three years. The Valuation Committee decides, after discussions with the Group’s external valuers, which valuation
techniques and inputs to use for each case.
Changes in estimates and assumptions about these inputs could affect the reported fair value.
33
DORIEMUS PLC
Notes forming part of the financial statements
for the year ended 31 December 2020 (continued)
1
Accounting policies (continued)
Current and deferred income tax
The tax expense for the period comprises current and deferred tax. Tax is recognised in the income statement, except to the
extent that it relates to items recognised in other comprehensive income or directly in equity. In this case the tax is also recognised
in other comprehensive income or directly in equity, respectively.
The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the balance sheet
date in the countries where the Company’s subsidiaries and associates operate and generate taxable income. Management
periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is subject to
interpretation and establishes provisions where appropriate on the basis of amounts expected to be paid to the tax authorities.
Deferred income tax is provided in full, using the liability method, on temporary differences arising between the tax bases of assets
and liabilities and their carrying amounts in the consolidated financial statements. However, the deferred income tax is not
accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business combination that at
the time of the transaction affects neither accounting nor taxable profit nor loss. Deferred income tax is determined using tax
rates (and laws) that have been enacted or substantially enacted by the balance sheet date and are expected to apply when the
related deferred income tax asset is realised, or the deferred income tax liability is settled.
Deferred income tax assets are recognised to the extent that it is probable that future taxable profit will be available against which
the temporary differences can be utilised. Deferred income tax is provided on temporary differences arising on disallowed
expenses, expect where the timing of the reversal of the temporary difference is controlled by the Company and it is probable
that the temporary difference will not reverse in the foreseeable future.
Deferred income tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets against
current tax liabilities and when the deferred income taxes assets and liabilities relate to income taxes levied by the same taxation
authority on either the taxable entity or different taxable entities where there is an intention to settle the balances on a net basis.
2
Revenue and segmental reporting
Segmental reporting
Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision
maker. The chief operating decision maker, who is responsible for allocating resources and assessing performance of the operating
segments, has been identified as the Board.
The Group’s current revenue is all generated in the United Kingdom from oil & gas production in accordance with its farm-in
agreements, within the United Kingdom. However, with this segment in its infancy, and with the only major related transactions
being the carrying value of the oil & gas properties assets as described in Note 8, no further segmental analysis is deemed useful
to disclose currently. The revenue from this segmental was nil (2019: AUD18,000).
Subject to further acquisitions, the Group’s expects to further review its segmental information during the forthcoming financial
year and update accordingly.
34
DORIEMUS PLC
Notes forming part of the financial statements
for the year ended 31 December 2020 (continued)
3
Staff and Director costs
Staff costs, including Directors, consist of:
Fees and remuneration for management services
Employers NI
Pension costs
Group
2020
AUD’000
2019
AUD’000
167
-
167
494
7
501
The Group has no employees other than the Directors. No pension contributions were made in respect of the Directors (2019:
nil). The key management personnel of the Group are the Board of Directors and their remuneration is disclosed below;
2020
K Coughlan
D Strang
G Lee
2019
K Coughlan
D Strang
G Lee
D Lenigas*
H Harris**
* Resigned 19 June 2019
** Resigned 17 July 2019
No Directors’ fees remain unpaid as at 31 December 2020 (2019: $45,200).
Fees and
salaries
AUD’000
54
55
58
167
Fees and
salaries
AUD’000
29
97
134
156
48
464
Group
Share based
payments
AUD’000
-
-
-
-
Share based
payments
AUD’000
-
-
-
-
-
Total
AUD’000
54
55
58
167
Total
AUD’000
29
97
134
156
48
464
35
Notes forming part of the financial statements
for the year ended 31 December 2020 (continued)
DORIEMUS PLC
4
Loss from operations
Loss from operations is stated after charging:
Group
Company
2020
AUD’000
2019
AUD’000
2020
AUD’000
2019
AUD’000
Fees payable to the auditor for the audit and review of:
Parent company and consolidated financial statements
Foreign currency exchange losses
Depletion charge
5
Taxation
Current tax expense:
UK corporation tax and income tax of overseas operations on
profits for the year
Total income tax expense
The reasons for the difference between the actual tax charge
for the period and the standard rate of corporation tax in the
UK applied to profits for the year are as follows:
Loss for the period
Standard rate of corporation tax in the UK
Loss on ordinary activities multiplied by the standard rate of
corporation tax
Expenses not deductible for tax purposes
Future income tax benefit not brought to account
Current tax charge for year
30
41
-
71
26
17
9
52
30
41
-
71
26
17
9
52
Group
Company
2020
AUD’000
2019
AUD’000
2020
AUD’000
2019
AUD’000
-
-
-
-
-
-
-
-
Group
Company
2020
AUD’000
(950)
19%
2019
AUD’000
(2,886)
19%
2020
AUD’000
(1,358)
19%
2019
AUD’000
(2,498)
19%
(181)
-
181
-
(548)
-
548
-
(258)
-
258
-
(475)
-
475
-
No deferred tax asset has been recognised because there is uncertainty of the timing of suitable future profits against which
they can be recovered.
6
Loss per share
The calculation of the basic loss per share is calculated by dividing the consolidated loss attributable to the equity holders of the
Group by the weighted average number of ordinary shares in issue during the year.
Basic earnings per share (cents)
Diluted earnings per share (cents)
(Loss) attributable to equity shareholders (AUD’000)
Group
Company
2020
(1.64)
(1.64)
(950)
2019
(4.98)
(3.98)
2020
(2.34)
(2.34)
2019
(4.31)
(3.44)
(2,886)
(1,358)
(2,498)
Number
Number
Number
Number
Weighted average number of shares - basic
57,983,125
57,983,125
57,983,125
57,983,125
The diluted number of shares includes 14.45 million share options (2019: 14.45 million share options) as described in Note 15.
However the impact of the share options are considered to be anti-dilutive.
36
DORIEMUS PLC
Notes forming part of the financial statements
for the year ended 31 December 2020 (continued)
7
Intangible assets
Cost
At 31 December 2018
Cost
Foreign exchange translation
At 31 December 2019
Additions
At 31 December 2020
Amortisation and impairment
At 31 December 2018
Additions
Foreign exchange translation
At 31 December 2019
Impairment
At 31 December 2020
Net book value
At 31 December 2020
At 31 December 2019
Group and Company
Licences &
Exploration
costs
AUD’000
Licences &
Exploration
costs
AUD’000
532
13
26
571
-
571
-
(145)
(4)
(149)
-
(149)
422
422
532
13
26
571
-
571
-
(145)
(4)
(149)
-
(149)
422
422
On 10 August 2016 the Company entered into an agreement to acquire a 5% beneficial interest in the onshore Isle of Wight oil &
gas licence “PEDL 331”, in the United Kingdom. Consideration paid for the total 5% interest totalled £200,000 (AUD374,540).
During 2019 the Company incurred direct exploration costs in relation to PEDL331 of AUD192,000.
37
DORIEMUS PLC
Notes forming part of the financial statements
for the year ended 31 December 2020 (continued)
8
Oil & gas properties
Cost
Opening balance
Additions
Disposals
Exploration costs written-off
Foreign exchange translation
Closing balance
Depletion and impairment
Opening balance
Impairment charge
Additions
Disposal
Foreign exchange translation
Closing balance
Net book value
At 31 December 2020
Transferred to asset held for sale
Group and Company
Oil & Gas
Properties
2020
AUD’000
Oil & Gas
Properties
2019
AUD’000
94
-
-
-
-
94
-
76
-
-
-
76
18
(18)
-
2,601
66
(885)
(1,472)
(216)
94
24
9
(8)
(26)
1
-
94
-
94
Impairment review
The Oil & Gas properties comprised the 20% participating interest in the Lidsey oil field, in the United Kingdom and the 10%
participating interest in the Brockham oil field, also in the United Kingdom. During the year ended 31 December 2019, the
Company sold its 10% participating interest in the Lidsey oil field for £468,000 (AUD859,000), resulting in a small gain of £3,000
(AUD5,500) during the year. The Company had previously written down this interest during the previous year.
On 22 October 2020, Doriemus agreed to dispose its entire 10% interest in Brockham to a subsidiary of Angus Energy Plc
(“Operator”) for consideration of GBP10,000 (AUD18,000).
As a result the Group’s interest has been written down to AUD18,000 and transferred to asset held for sale. The transfer of
Doriemus’ interest in Brockham will complete after the UK regulator approves the transfer.
38
DORIEMUS PLC
Notes forming part of the financial statements
for the year ended 31 December 2019 (continued)
9
Net liabilities held for sale
Asset transferred from oil and gas properties
Liabilities on asset held for sale
Net liabilities held for sale at 31 December
Group and Company
2020
AUD’000
18
(475)
(457)
2019
AUD’000
-
-
-
On 22 October 2020, Doriemus announced the Company agreed to dispose of its entire 10% interest in Brockham to a subsidiary
of Angus Energy Plc (the “Operator) for consideration of GBP10,000 (AUD18,000). The consideration will be set-off against all
of the remaining accrued contractual amounts owed by Doriemus to the Operator under the existing joint operating agreement,
including historic cash calls, abandonment liabilities and VAT, which total approximately GBP260,000 (AUD475,000).
10
Financial investments
Investment in Listed & unlisted securities
Valuation at 1 January
Additions at cost
Disposal proceeds
Impairment and change in fair value
Net gain on disposals & market value movements
Valuation at 31 December
Group and Company
2020
AUD’000
797
-
(62)
(276)
-
459
2019
AUD’000
1,772
4,835
(7,272)
(188)
1,650
797
Financial investments comprise investments in listed and unlisted companies which are at market value, and are held by the
Group as a mix of strategic and short term investments.
At 31 December 2020, the Directors have carried out a fair value review and have considered that an impairment and fair value
adjustment of AUD276,000 (2019: AUD188,000) is required in relation to its financial investments.
11
Investment in subsidiaries
Company
Country of Registration
Proportion held
Nature of business
Direct
Doriemus Energy Pty Ltd
Via Doriemus Energy Pty Ltd
Doriemus L15 Pty Ltd
Australia
Australia
100%
100%
Oil and Gas Services Company
Dormant company
The Parent company acquired all of the subsidiaries on their incorporation for nominal share holdings of A$10.
12
Trade and other receivables
Loan to related party – non-current (See Note 18)
Loan to related party – current (See Note 18)
Other receivables - current
Prepayments and accrued income - current
Group
Company
2020
AUD’000
1,005
-
8
-
1,013
2019
AUD’000
-
1,335
360
6
1,701
2020
AUD’000
1,005
-
3
-
1,008
2019
AUD’000
-
1,767
358
5
2,130
The Directors consider that the carrying amount of trade and other receivables approximates to their fair value.
39
DORIEMUS PLC
Notes forming part of the financial statements
for the year ended 31 December 2020 (continued)
13
Cash and cash equivalents
Analysis by currency;
Sterling
Australian Dollar
14
Trade and other payables
Trade payables
Other payables
Accrued liabilities and deferred income
Group
Company
2020
AUD’000
2019
AUD’000
2020
AUD’000
2019
AUD’000
1,166
63
1,229
1,633
79
1,712
1,166
56
1,222
1,633
45
1,678
Group
Company
2020
AUD’000
22
2
18
42
2019
AUD’000
772
55
333
1,160
2020
AUD’000
22
2
18
42
2019
AUD000
772
55
324
1,151
The Directors consider that the carrying amount of trade and other payables approximates to their fair value.
15
Share capital
Ordinary shares of 0.4p each
Allotted, called up and fully paid
At 31 December 2018
At 31 December 2019
At 31 December 2020
Ordinary
Shares
Number
57,938,125
57,983,125
57,983,125
Nominal
Value
AUD’000
411
411
411
Dividends Paid
During the years ended 31 December 2019 and 31 December 2020, the Group paid no dividends.
Capital Management
The Group’s capital comprises the ordinary shares 0.4p (2019: 0.4p) each, as shown above.
The Group’s objectives when maintaining capital are:
to safeguard the entity's ability to continue as a going concern, so that it can continue to provide returns for shareholders
and benefits for other stakeholders, and
to provide an adequate return to shareholders by pricing products and services commensurately with the level of risk.
The Group sets the amount of capital it requires in proportion to risk. The Group manages its capital structure and makes
adjustments to it in the light of changes in economic conditions and the risk characteristics of the underlying assets. In order to
maintain or adjust the capital structure, the Group may adjust the amount of dividends paid to shareholders, return capital to
shareholders, issue new shares, or sell assets to reduce debt.
Share Options
The Group has as at 31 December 2020, 14,450,000 (2019: 14,450,000) share options issued through its share schemes. During
the year nil share options were issued (2019: nil). The share options on issue have exercise prices of 13.2p up to 20p per share,
which are exercisable on various dates up to 28 September 2022. The Group cancelled none of the existing options on issue (2019:
nil). During the year no options lapsed (2019: nil).
Warrants in issue
As at 31 December 2020, nil warrants remained outstanding (2019: nil). No warrants were issued during the year (2019: nil).
40
DORIEMUS PLC
Notes forming part of the financial statements
for the year ended 31 December 2020 (continued)
16
Share based payments
Share options held by Directors, employees and third parties as at 31 December 2020 are as follows:
Grant date
Expiry date
Exercise price
11 May 2017
24 May 2017
29 September 2017
29 September 2017
Total options in issue
30 June 2021
30 June 2021
28 September 2021
28 September 2022
£
0.20
0.132
0.1917
0.1917
Outstanding as at
31 December 2020
Number
75,000
1,250,000
2,000,000
11,125,000
14,450,000
17 Material non-cash transactions
During the year the significant non-cash transactions were as follows:
$76,000 impairment on asset held for sale. Refer Note 8 Oil and gas properties.
$276,000 impairment on financial investments. Refer Note 10 Financial investments.
Creditors written back of $181,000.
18
Related party transactions
The Group had the following amounts outstanding from its investee companies (Note 10 Financial Investments) at 31 December:
Doriemus Energy Pty Ltd
Horse Hill Development Ltd (“Horse Hill”)
Loan Interest receivable (“Horse Hill”)
Group
Company
2020
AUD’000
-
850
155
1,005
2019
AUD’000
-
1,190
145
1,335
2020
AUD’000
-
850
155
1,005
2019
AUD’000
432
1,190
145
1,767
The above loans outstanding are included within trade and other receivables, Note 12. The loan to Horse Hill has been made in
accordance with the terms of the investment agreement whereby it accrues interest daily at the Bank of England base rate +10%,
and is repayable out of future cashflows.
The amount outstanding from Doriemus Energy Pty Ltd, a controlled entity of the Company of $509,000 has been written off in
the Company’s statement of profit or loss and other comprehensive income. The amount owing to Angus Energy Weald Basin
No.3 Limited, a related party of $181,000 has been written off in the Group’s and Company’s statement of profit or loss and
comprehensive income.
Remuneration of Key Management Personnel
The remuneration of the Directors, and other key management personnel of the Group, is set out below in aggregate for each
of the categories specified for Related Party Disclosures.
Short-term employee benefits
Group
Company
2020
AUD’000
167
167
2019
AUD’000
464
464
2020
AUD’000
67
67
2019
AUD’000
354
354
41
DORIEMUS PLC
Notes forming part of the financial statements
for the year ended 31 December 2020 (continued)
19
Financial instruments
Financial risk management
The Board of Directors sets the treasury policies and objectives of the Group, which includes controls over the procedures used
to manage financial market risks.
It is, and has been throughput the period under review, the Group’s policy that no major trading in financial instruments shall be
undertaken. The main risks arising from the Group’s financial instruments are:
interest rate risk;
liquidity risk;
credit risk;
market risk;
commodity price risk; and
foreign currency risk.
Principal financial instruments
The principal financial instruments used by the Group from which financial instrument risk arises, are as follows:
Financial assets
Other receivables (Note 12)
Other loans (Note 12)
Cash and cash equivalents (Note 13)
Total financial assets classified as loans and receivables
Group
Company
2020
AUD’000
2019
AUD’000
2020
AUD’000
2019
AUD’000
8
1,005
1,229
2,242
360
1,335
1,712
3,407
3
1,005
1,222
2,230
358
1,767
1,678
3,803
The maximum exposure to credit risk at the reporting date is the fair value of each class of receivable set out above.
At 31 December 2020 and 2019 the carrying amounts of financial assets approximate to their fair values.
Financial liabilities
Net liabilities held for sale (Note 9)
Trade payables (Note 14)
Other payables (Note 14)
Accrued liabilities (Note 14)
Total financial liabilities measured at amortised cost
Group
Company
2020
AUD’000
2019
AUD’000
2020
AUD’000
2019
AUD’000
457
22
2
18
499
-
772
55
333
1,160
457
22
2
18
499
-
772
55
324
1,151
To the extent trade and other payables are not carried at fair value in the statement of financial position, book value approximates
to fair value at 31 December 2020 and 2019.
All financial assets and liabilities are due in less than 6 months.
42
Notes forming part of the financial statements
for the year ended 31 December 2020 (continued)
DORIEMUS PLC
The Group is exposed through its operations to one or more of the following financial risks:
Interest rate risk
The Group has minimal risk towards interest rate changes, other than those effects on interest being received on cash held in the
Group’s bank accounts.
Liquidity risk
The Group manages liquidity risk by continuously monitoring forecast and actual cash flows and matching the maturity profiles of
financial assets and liabilities. Due to the dynamic nature of the underlying businesses, the Group aims at ensuring flexibility in its
liquidity profile by maintaining the ability to undertake capital raisings.
Credit risk
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Group.
The Group has adopted the policy of only dealing with credit worthy counterparties and obtaining sufficient collateral or other
security where appropriate, as a means of mitigating the risk of financial loss from defaults. The Group does not have any
significant credit risk exposure to any single counterparty or any Group of counterparties having similar characteristics. The
carrying amount of financial assets recorded in the financial statements, net of any provisions for losses, represents the Group’s
maximum exposure to credit risk. All cash equivalents are held with financial institutions with a credit rating of -AA or above.
Market risk
The Group’s current exposure to market risk is fundamentally linked to its interest in its listed financial investments, and the
market price fluctuations thereof.
The Board agrees and reviews policies and financial instruments for risk management. The primary objectives of the treasury
function are to provide competitively priced funding for the activities of the Group and to identify and manage financial risk.
Commodity price risk
The Group is exposed to the risk of fluctuations in prevailing market commodity prices on the mix of oil and gas products through
its farm-in arrangements. The Group has minimal risk towards commodity price changes, other than those effects on the loan to
Horse Hill.
Foreign Currency risk
The Group undertakes certain transactions denominated in foreign currency and are exposed to foreign currency risk through
foreign exchange rate fluctuations. Foreign exchange risk arises from future commercial transactions and recognised financial
assets and financial liabilities denominated in a currency that is not the entity’s functional currency. The risk is measured using
sensitivity analysis.
The Group operates internationally and is exposed to foreign exchange risk arising from currency exposure to the Pound Sterling
(GBP). The Group was not exposed to material foreign currency risk at 31 December 2019. At 31 December 2020, the Group’s
exposure to foreign currency risk at the end of the reporting period, expressed in Australian dollar, was as follows:
43
DORIEMUS PLC
Notes forming part of the financial statements
for the year ended 31 December 2020 (continued)
19
Financial instruments (continued)
Foreign Currency risk (continued)
Cash and cash equivalents (Note 13)
Trade and other receivables (Note 12)
Net liabilities held for sale (Note 9)
Group
2020
AUD’000
Company
2020
AUD’000
1,166
1,005
2,171
(457)
(457)
1,166
1,005
2,171
(457)
(457)
Sensitivity analysis (Group)
A reasonably possible strengthening (weakening) of the GBP against AUD at 31 December 2020 would have affected the
measurement of financial instruments denominated in a foreign currency and affected equity and profit or loss for the Group and
the Company by the amounts shown below. This analysis assumes all other variables, in particular interest rates, remain constant.
Cash and cash equivalents
Trade and other receivables – non-current
Net liabilities held for sale
Group
Company
Increase (Decrease) in Equity and Profit of Loss
AUD to GBP
AUD to GBP
+10%
AUD’000
(-10%)
AUD’000
+10%
AUD’000
(-10%)
AUD’000
(102)
(91)
(193)
39
39
134
112
246
(53)
(53)
(102)
(91)
(193)
39
39
134
112
246
(53)
(53)
Fair value measurements
The fair value of the Group’s and Company’s financial assets and financial liabilities must be estimated for recognition and
measurement or for disclosure purposes. IFRS 7 Financial Instruments: Disclosures requires disclosure of fair value measurements
by level of the following fair value measurement hierarchy:
i)
ii)
iii)
Quoted prices in active markets for identical assets or liabilities (level 1)
Inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly
(as prices) or indirectly (level 2); and
Inputs for the asset or liability that are not based on observable market data (unobservable inputs) (level 3).
Financial investments
Trade and other receivables
Net liabilities held for sale
Fair value hierarchy as at 31 December 2020
Level 1
AUD’000
Level 2
AUD’000
Level 3
AUD’000
Total
AUD’000
-
-
-
-
-
-
-
-
-
-
459
1,005
1,464
(457)
(457)
459
1,005
1,464
(457)
(457)
44
DORIEMUS PLC
Notes forming part of the financial statements
for the year ended 31 December 2020 (continued)
20
Events after the end of the reporting period
No matter or circumstance has arisen that has significantly affected, or may significantly affect the Group’s operations in future
financial years, or the results of those operations in future financial years, or the Group’s state of affairs in future financial years.
21
Commitments and contingencies
The Directors have confirmed that there were no contingent liabilities or capital commitments which should be disclosed at 31
December 2020. No provision has been made in the financial statements for any amounts in relation to any capital expenditure
requirements of the Group’s farm-in agreements, and such costs are expected to be fulfilled in the normal course of the operations
of the Group.
22
Ultimate controlling party
There is not considered to be an ultimate controlling party of the parent company.
45
ADDITIONAL INFORMATION FOR ASX LISTED PUBLIC COMPANIES
DORIEMUS PLC
The following additional information is required by the Australian Securities Exchange in respect of listed public companies only.
1.
Shareholding as at 5 March 2021
(a) Distribution of Equity Shareholders
Category (size of holding)
Shares (including CDIs)
Options (unlisted)
Number of
Shareholders
Number of
Shares
Number of
option holders
Number of
options
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 and over
Total
259
126
65
134
61
645
175,468
378,835
485,098
4,437,663
52,506,061
57,983,125
-
-
-
1
9
10
-
-
-
75,000
14,375,000
14,450,000
(b) Number of Shareholders with Less than a Marketable Parcel
435
(c) Voting Rights
The Company is incorporated under the legal jurisdiction of England and Wales. To enable companies such as the
Company to have their securities cleared and settled electronically through CHESS, Depositary Instruments called
CHESS Depositary Interests (CDIs) are issued. Each CDI represents one underlying ordinary share in the Company
(Share). The main difference between holding CDIs and Shares is that CDI holders hold the beneficial ownership in the
Shares instead of legal title. CHESS Depositary Nominees Pty Limited (CDN), a subsidiary of ASX, holds the legal title to
the underlying Shares.
Pursuant to the ASX Settlement Operating Rules, CDI holders receive all of the economic benefits of actual ownership
of the underlying Shares. CDIs are traded in a manner similar to shares of Australian companies listed on ASX.
CDIs will be held in uncertificated form and settled/transferred through CHESS. No share certificates will be issued to
CDI holders. Each CDI is entitled to one vote when a poll is called, otherwise each member present at a meeting or by
proxy has one vote on a show of hands.
If holders of CDls wish to attend and vote at the Company's general meetings, they will be able to do so. Under the
ASX Listing Rules and the ASX Settlement Operating Rules, the Company as an issuer of CDls must allow CDI holders to
attend any meeting of the holders of Shares unless relevant English law at the time of the meeting prevents CDI holders
from attending those meetings.
In order to vote at such meetings, CDI holders have the following options:
(a)
instructing CDN, as the legal owner, to vote the Shares underlying their CDls in a particular manner. A voting
instruction form will be sent to CDI holders with the notice of meeting or proxy statement for the meeting and this
must be completed and returned to the Company's Share Registry prior to the meeting; or
46
ADDITIONAL INFORMATION FOR ASX LISTED PUBLIC COMPANIES
DORIEMUS PLC
(b)
informing the Company that they wish to nominate themselves or another person to be appointed as CDN's proxy
with respect to their Shares underlying the CDls for the purposes of attending and voting at the general meeting;
or
(c) converting their CDls into a holding of Shares and voting these at the meeting (however, if thereafter the former
CDI holder wishes to sell their investment on ASX it would be necessary to convert the Shares back to CDls). In
order to vote in person, the conversion must be completed prior to the record date for the meeting. See above
for further information regarding the conversion process.
As holders of CDls will not appear on the Company's share register as the legal holders of the Shares, they will not be
entitled to vote at Shareholder meetings unless one of the above steps is undertaken.
As each CDI represents one Share, a CDI Holder will be entitled to one vote for every CDl they hold.
Proxy forms, CDI voting instruction forms and details of these alternatives will be included in each notice of meeting
sent to CDI holders by the Company.
These voting rights exist only under the ASX Settlement Operating Rules, rather than under the Companies Act 2006
(England and Wales). Since CDN is the legal holder of the applicable Shares and the holders of CDIs are not themselves
the legal holder of their applicable Shares, the holders of CDls do not have any directly enforceable rights under the
Company’s articles of association.
As holders of CDIs will not appear on our share register as the legal holders of shares of ordinary shares they will not
be entitled to vote at our shareholder meetings unless one of the above steps is undertaken.
(d) 20 Largest Shareholders as at 5 March 2021
CDIs
7,558,693
7,068,182
3,700,000
2,677,999
2,521,612
2,341,337
2,000,000
1,338,275
1,306,782
1,250,000
1,169,550
1,116,204
1,089,926
1,042,196
1,000,000
950,000
924,739
750,000
750,000
724,000
41,279,495
%
13.04
12.19
6.38
4.62
4.35
4.04
3.45
2.31
2.25
2.16
2.02
1.93
1.88
1.80
1.72
1.64
1.59
1.29
1.29
1.25
71.20
Shareholder
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
CITICORP NOMINEES PTY LIMITED
MR JAY EVAN DALE HUGHES
PORTFOLIO DESIGN GROUP
FLUE HOLDINGS PTY LTD
BNP PARIBAS NOMINEES PTY LTD SIX SIS LTD
ALEXANDER HOLDINGS (WA) PTY LTD
OCEAN VIEW WA PTY LTD
KOBIA HOLDINGS PTY LTD
BRISQUE PTY LTD
ALR INVESTMENTS PTY LTD
No.
1
2
3
4
5
6
7
8
9
10
11
12 MR BOBBY VINCENT LI
13
14
15 OCEAN VIEW WA PTY LTD
16
17
18 MR BEN WEST STATHAM + MRS ELLE LOUISE STATHAM
HSDL NOMINEES LIMITED
GOLDEN TRIANGLE CAPITAL PTY LTD
PERSHING NOMINEES LIMITED
S/F A/C>
19 MR HAMISH HARRIS
20 MR PAVLE TOMASEVIC
47
ADDITIONAL INFORMATION FOR ASX LISTED PUBLIC COMPANIES
(e) Substantial Shareholders as at 5 March 2021
DORIEMUS PLC
To the best of Doriemus’ knowledge, the names of all Substantial Holders and the number of equity securities in which
each Substantial Holder has a relevant interest (within the meaning of section 608 of the Corporations Act) is as follows:
No.
1
2
3
Shareholder
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
CITICORP NOMINEES PTY LIMITED
MR JAY EVAN DALE HUGHES
CDIs
7,558,693
7,068,182
3,700,000
18,326,875
%
13.04
12.19
6.38
31.61
2.
Name of Joint Company Secretaries
Donald Strang and Jessamyn Lyons
3.
Principal Registered Offices
Australia
Suite 2
11 Ventnor Avenue
West Perth WA 6005
Telephone +61 (0) 6245 2050
United Kingdom
c/o Hill Dickinson
The Broadgate Tower
20 Primrose Street
London
EC2A 2EW
Telephone +44 (0) 7897 584 153
4.
Registers of Securities
The Company operates a certificated principal register of Shares in the UK branch and an uncertificated issuer sponsored
sub-register of CDIs and an uncertificated CHESS sub-register of CDIs in Australia.
The Company’s uncertificated issuer sponsored sub-register of CDIs and uncertificated CHESS sub-register of CDIs is
maintained by Computershare as per the below. The branch register is the register of the legal title (and will reflect legal
ownership by CDN of the Shares underlying the CDIs with the Shares held by CDN recorded on the branch register of Shares
in Australia). The two uncertificated sub-registers of CDIs combined make up the register of beneficial title of the Shares
underlying the CDIs.
The Register of Securities is held at:
Australia
Computershare Investor Services Limited
Level 11
172 St Georges Terrace
PERTH WA 6000
Telephone number: +61 (0) 9323 2000
United Kingdom
Computershare Investor Services PLC
The Pavilions, Bridgwater Road
Bristol, BS99 6ZZ
United Kingdom
Telephone number: +44 (0) 370 702 0003
48
ADDITIONAL INFORMATION FOR ASX LISTED PUBLIC COMPANIES
5.
Securities Exchange Listing
DORIEMUS PLC
Quotation has been granted for all the CDIs of the Company on the Australian Securities Exchange Limited. The Company
is not listed on any other exchange.
6.
Unquoted Securities
Doriemus has 14,450,000 options on issue, which are exercisable over 14,450,000 ordinary shares as follows:
Grant date
Expiry date
Exercise price
11 May 2017
24 May 2017
30 June 2021
30 June 2021
29 September 2017
28 September 2021
29 September 2017
28 September 2022
£
0.20
0.132
0.1917
0.1917
Total
No single person holds 20% or more of the equity securities in an unquoted class.
Outstanding as at
31 December 2020
Number
75,000
1,250,000
2,000,000
11,125,000
14,450,000
7.
Restricted Securities
There are no restricted securities on issue.
8.
On Market Buy-Back
There is no current on-market buy-back of our securities.
9.
Section 611 (7) Corporations Act
There are no issues of securities approved for the purposes of Item 7 of section 611 of the Corporations Act which have
not yet been completed.
10.
Place of Incorporation
Doriemus is incorporated in the jurisdiction of England and Wales with company number 03877125.
Doriemus is registered as a foreign company in Australia with registered number 619 213 437.
11.
Summary of licences as at 5 March 2021
Asset
Brockham
PL 235
Horse Hill*
PEDL 137
Horse Hill*
PEDL 246
Isle of Wight
PEDL331
GGO
EL 2015/13
GGO
EL 2015/14
Country
UK
Doriemus Interest
10% participating interest in PL 235
Status
Producing
Operator
Angus
Licence Area
8.9km2
UK
UK
UK
4% shareholding in HHDL (representing a 2.6%
attributable interest in PEDL137)
4% shareholding in HHDL (representing a 2.6%
attributable interest in PEDL 246)
5% participating interest in PEDL 331
Exploration HHDL
99.3km2
Exploration HHDL
43.4km2
Exploration UKOG
199.8km2
Greenland 2.82% shareholding in GGO (representing a
Exploration GGO
2.64% interest in EL 2015/13)
Greenland 2.82% shareholding in GGO (representing a
Exploration GGO
2.572 km2
2.923 km2
2.64% interest in EL 2015/14)
49
CORPORATE GOVERNANCE STATEMENT
DORIEMUS PLC
Doriemus PLC is committed to high standards of corporate governance. The Company is listed on the Australian Securities
Exchange (“ASX”) and advise that copy of our corporate governance section of the Company’s website www. Doriemus.co.uk
(together with the various Corporate Governance policies of the Company). This corporate governance statement relates to the
financial year ended 31 December 2020, and has been approved by the Board.
A Corporate Governance summary discloses the extent to which the Company will follow the recommendations set by the ASX
Corporate Governance Council in its publication ‘Corporate Governance Principles and Recommendations (4th Edition)’
(Recommendations). The Recommendations are not mandatory, however, the Recommendations that will not be followed have
been identified and reasons have been provided for not following them.
As a company registered in England and Wales, the Company is not required to comply with the provisions of the Governance
Code or the Corporate Governance Code for Small and Mid-Size Quoted Companies 2013 published by the Quoted Companies
Alliance. However, the Board recognises the importance of sound corporate governance and intends that the Company will comply
with the provisions of the Governance Code, the QCA Guidelines and the ASX Corporate Governance Principles and
Recommendations insofar as they are appropriate given the Company’s size and stage of development.
A summary of the key risks for the Company are set out below.
Communication with shareholders
The Board recognises it is accountable to shareholders for the performance and activities of the Company.
The 2020 Annual General Meeting of the Company will provide an opportunity for the Chairman to present to the shareholders a
report on current operations and developments and enable the shareholders to express their views about the Company’s business.
The Board
The Board of Doriemus PLC currently consists of two Non-Executive Directors and one Executive Director (Technical). The
composition of the Board ensures no one individual or Group of persons dominates the decision making process.
The Board is responsible to the shareholders for setting the direction of the Company through the establishment of strategic
objectives and key policies. The Board meets on a regular basis and considers the strategic direction, approves major capital
expenditure, and any other matters having a material effect on the Company. Presentations are made to the Board on the activities
and both the Executive and Non-Executive Directors undertake visits to operations.
All Directors have access to management, including the Company Secretaries, and to such information as is needed to carry out
their duties and responsibilities fully and effectively.
The composition and tenure of the Board as of 31 December 2020, as well as each member’s independence status during 2020,
was as follows:
Director
Director Position
Tenure1
Independence
Keith Coughlan2
Donald Strang
Executive Chairman
Executive Finance Director
1.5 years
7.5 years
Gregory Lee
Executive Technical
Director
2.3 years
Yes
No
No
Audit & Risk
Committee
Remuneration
& Nomination
Committee
x
x
NOTES:
1 – Calculated as of 31 December 2020.
2 – Mr Coughlan was appointed to the Board on 19 June 2019.
50
CORPORATE GOVERNANCE STATEMENT
Takeover regulations
DORIEMUS PLC
Doriemus plc is not subject to Chapters 6, 6A, 6B or 6C of the Corporations Act 2001 (Cth), or Corporations Act, dealing with the
acquisitions of shares (including substantial shareholdings and takeovers). Chapters 6, 6A, 6B and 6C of the Corporations Act
dealing with the acquisition of shares (including acquisitions and takeovers) does not apply to the Company given it is incorporated
in England and Wales. Instead the Company is subject to the application of the City Code on Takeovers and Mergers in the UK (the
“City Code”) and further detailed below.
Mandatory bid
The Company is subject to the application of the City Code. Under Rule 9 of the City Code, any person who acquires an interest in
shares which, taken together with shares in which he or persons acting in concert with him are interested, carry 30% or more of
the voting rights in the Company will normally be required to make a general offer to all the remaining shareholders to acquire
their shares. Similarly, when any person or persons acting in concert is interested in shares which in aggregate carry 30% of the
voting rights of the Company but which do not carry more than 50% of the voting rights in the Company, a general offer will
normally be required to be made if he or any person acting in concert with him acquires an interest in any other shares in the
Company. An offer under Rule 9 must be in cash, normally at the highest price paid within the preceding 12 months for any interest
in shares of the same class acquired in the Company by the person required to make the offer or any person acting in concert with
him.
Squeeze-out
Under the Companies Act 2006 (England and Wales), if an offeror were to make an offer to acquire all of the shares in the Company
not already owned by it and were to acquire 90% of the shares to which such offer related it could then compulsorily acquire the
remaining 10%. The offeror would do so by sending a notice to outstanding members telling them that it will compulsorily acquire
their shares and then, six weeks later, it would deliver a transfer of the outstanding shares in its favour to the Company which
would execute the transfers on behalf of the relevant members, and pay the consideration to the Company which would hold the
consideration on trust for outstanding members. The consideration offered to the members whose shares are compulsorily
acquired under this procedure must, in general, be the same as the consideration that was available under the original offer unless
a member can show that the offer value is unfair.
Sell-out
The Companies Act 2006 (England and Wales) also gives minority members a right to be bought out in certain circumstances by
an offeror who has made a takeover offer. If a takeover offer related to all the shares in the Company and, at any time before the
end of the period within which the offer could be accepted, the offeror held or had agreed to acquire not less than 90% of the
shares, any holder of shares to which the offer related who had not accepted the offer could by a written communication to the
offeror require it to acquire those shares. The offeror would be required to give any member notice of his/her right to be bought
out within one month of that right arising. The offeror may impose a time limit on the rights of minority members to be bought
out, but that period cannot end less than three months after the end of the acceptance period or, if later, three months from the
date on which notice is served on members notifying them of their sell-out rights. If a member exercises his/her rights, the offerors
are entitled and bound to acquire those shares on the terms of the offer or on such other terms as may be agreed.
Key risks
Our business faces many risks. We believe the risks described below are the material risks that we face. However, the risks
described below may not be the only risks that we face. Additional unknown risks or risks that we currently consider immaterial,
may also impair our business operations. If any of the events or circumstances described below actually occur, our business,
financial condition or results of operations could suffer, and the trading price of our Shares / CDIs could decline significantly. The
Board reviews the entity’s risk management framework at least annually to satisfy itself that it continues to be sound.
There can be no guarantee that the Company will deliver on its business strategy, that the Company will generate any revenue.
Investors should note that past performance is not a reliable indicator of future performance. If any of the risks referred to in this
annual report were to occur, the results of operations, financial condition and prospects of the Company could be materially
adversely affected. If that were to be the case, the trading price of the options and the underlying CDIs and/or the level of dividends
or distributions (if any) received from the CDIs could decline significantly.
51
CORPORATE GOVERNANCE STATEMENT
DORIEMUS PLC
The risks referred to below are not to be taken as exhaustive. Where relevant, the risks below assume completion of the Offer has
occurred. The specific risks considered below and other risks and uncertainties not currently known to the Company, or that are
currently considered immaterial, may materially and adversely affect the Company’s business operations, its financial
performance and the value and market price of its shares and or underlying CDIs.
General risks
A summary of the major general risks is set out below.
(a)
(b)
(c)
Trading Price of Shares and CDIs -The Company’s operating results, economic and financial prospects and other
factors will affect the trading price of its shares and CDIs. In addition, factors that in the future may impact
specifically on the share prices of listed companies identified as being part of or involved in the oil and gas sector
may impact likewise on the price of the Company’s securities. In particular, the share / CDI prices for many
companies including Doriemus, have been and may in the future be highly volatile, which in many cases may
reflect a diverse range of non-company specific influences such as global hostilities and tensions relating to
certain unstable regions of the world, acts of terrorism and the general state of the global economy and trading
on the market. No assurances can be made that the Company’s market performance will not be adversely
affected by any such market fluctuations or factors.
Political conditions and government regulations - Although political conditions in the UK and Australia are
generally stable (See risk factor ‘Withdrawal of the UK from the European Union above), changes may occur in
their political, fiscal and legal systems, which might adversely affect the ownership or operation of the
Company’s interests including, inter alia, changes in exchange rates, exchange control regulations, expropriation
of oil and gas rights, changes in government and in legislative, fiscal and regulatory regimes. The Company’s
strategy has been formulated in the light of the current regulatory environment and likely future changes.
Although the Directors believe that the Company’s activities are currently carried out in accordance with all
applicable rules and regulations, no assurance can be given that new rules, laws and regulations will not be
enacted or that existing or future rules and regulations will not be applied in a manner which could serve to limit
or curtail exploration, production or development of the Company’s business or have an otherwise negative
impact on its activities. Amendments to existing rules, laws and regulations governing the Company’s operations
and activities, or increases in or more stringent enforcement, implementation or interpretation thereof, could
have a material adverse impact on the Company’s business, results of operations and financial condition and its
industry in general in terms of additional compliance costs.
Withdrawal of the UK from the European Union - A Following the British government’s decision to invoke Article
50 on 29 March 2017 (and consequent changes to the exit date) the UK left the European Union (EU) on 31
January 2020 (Brexit). At this stage, the nature of the future relationship between the UK and the remaining EU
countries following Brexit has yet to be agreed and negotiations with the EU on the terms of Brexit have
demonstrated the difficulties that exist in reaching such an agreement. Depending on the terms of the
negotiations, the UK could also lose access to the single EU market and to the global trade deals negotiated by
the EU on behalf of its members. Such a decline in trade could have a detrimental impact on economic growth
in the country. Furthermore, regardless of the form of any withdrawal agreement, there are likely to be changes
in the legal rights and obligations of commercial parties across all industries following Brexit, and British
regulatory requirements once outside the EU could be subject to significant change. The UK’s current main
trade partners are members of the EU single market and the effect of the UK’s exit may prove to be a barrier to
trade or determine that trade is less favourable for the UK which could lose the automatic benefit of access to
the EU single market and EU free trade agreements. Currency rates including Pounds Sterling (which is the
Company’s functional currency) and the euro were volatile prior to and immediately after the referendum and
may remain volatile during the exit negotiations which may increase the Company’s investment and portfolio
risk. Brexit may also make it more difficult for the Company to acquire or access funds for investment on
acceptable terms whilst the exit negotiations may create uncertainty and further risk which could affect the
Company’s investment strategy (including its exit from its UK investments). A material amount of UK law is based
on EU law including significant parts of the financial services legislation. Subject to the exit negotiations, the
Company may be required to adopt other measures which could increase its costs and adversely affect its
investment strategy.
52
CORPORATE GOVERNANCE STATEMENT
General risks
DORIEMUS PLC
(d)
(e)
(f)
(g)
(h)
Commodity prices - Historically, commodity prices have fluctuated and are affected by numerous factors beyond
the Company’s control, including global demand and supply, weather conditions, the price and availability of
alternative fuels, actions taken by governments and international cartels, the cost of freight, international
economic trends, currency exchange fluctuations, expectations for inflation, speculative activity, consumption
patterns and global or regional political events. The aggregate effect of these factors is impossible to predict.
Fluctuations in commodity prices, over the long term, may adversely impact the returns from the Company’s
investments. International oil and gas prices have fluctuated widely in recent years and may continue to fluctuate
significantly in the future. Sustained downward movements in oil and gas prices could render less economic, or
wholly uneconomic, some or all of the exploration and the existing, and potential future, oil production related
activities to be undertaken in respect of those assets in which the Company has an interest. Any material decline
in oil and gas prices could result in a reduction of the Company’s net production revenue and overall value. The
economics of producing from some wells may change as a result of lower prices, which could result in a reduction
in the volumes produced from the Company’s assets. The operators and other owners of the assets in which the
Company holds interests might also elect not to produce from certain wells at lower prices. All of these factors
could result in a material decrease in the Company’s net production revenue causing a reduction in its acquisition
and development activities. A substantial material decline in prices from historical average prices could also
reduce the Company’s ability to borrow future funds.
Force majeure events - Events may occur within or outside the UK or Australia that could impact upon the global
and Australian economies, the operations of the Company and the price of the CDIs. These events include but
are not limited to acts of terrorism, an outbreak of international hostilities, fires, floods, earthquakes, labour
strikes, civil wars, natural disasters, outbreaks of disease or other man-made or natural events or occurrences
that can have an adverse effect on the demand for oil and gas products and the Company’s ability to conduct
business.
Greenhouse gas emissions - Many participants in the oil and gas sector are subject to current and planned
legislation in relation to the emission of carbon dioxide, methane, nitrous oxide and other so called “greenhouse
gases”. Failure by the operator of any investments of the Company to comply with existing legislation or any
future legislation could adversely affect the Company’s profitability. Future legislative initiatives designed to
reduce the consumption of hydrocarbons could also have an impact on the ability to market the oil and gas
produced from the Company’s investments and/or the prices which can be obtained from them. These factors
could have a material adverse effect on the Company’s business, results of operations, financial condition or
prospects.
Technological developments - the operators of the oil and gas licences in which the Company is a participant or
may acquire in the future or the Company itself may not be able to keep pace with technological developments
in the oil and gas industry. The oil industry is characterised by rapid and significant technological advancements
and introductions of new products and services using new technologies. As others use or develop new
technologies, the Company may be placed at a competitive disadvantage, and competitive pressures may force
the operators of the Company’s investments to implement those new technologies at substantial cost.
Material facts or circumstances not revealed in the due diligence process - Prior to making or proposing any
investment, the Company will undertake legal, financial and commercial due diligence on potential investments
to a level considered reasonable and appropriate by the Company on a case by case basis. However, these efforts
may not reveal all material facts or circumstances that would have a material adverse effect upon the value of
the investment. In undertaking due diligence, the Company will need to utilise its own resources and may be
required to rely upon third parties to conduct certain aspects of the due diligence process. Further, the Company
may not have the ability to review all documents relating to the proposed investee company and assets. Any due
diligence process involves subjective analysis and there can be no assurance that due diligence will reveal all
material issues related to a potential investment. Any failure to reveal all material facts or circumstances relating
to a potential investment may have a material adverse effect on the business, financial condition, results of
operations and prospects of the Company.
53
CORPORATE GOVERNANCE STATEMENT
General risks
DORIEMUS PLC
(i)
(j)
(k)
(l)
Currency and foreign exchange - The Company’s business may be carried out in the future in currencies other
than Pounds Sterling. Principal operations are expected to involve transactions in either Pounds Sterling or US
dollars. To the extent that there are fluctuations in exchange rates, this may have an impact on the figures
consolidated in the Company’s accounts, which could have a material impact on the Company’s financial position
or result of operations, as shown in the Company’s accounts going forward. The proceeds of the Offer will be
received in Australian dollars, while the Company’s functional currency is Pounds Sterling. As the Company is not
currently hedging against exchange rate fluctuations it will be at risk of any adverse movement in the Pounds
Sterling-Australian dollar exchange rate between the pricing of the Offer and the closing of the Offer.
Trading - The price at which the CDIs may trade and the price which investors may realise for their CDIs will be
influenced by a large number of factors, some specific to the Company and some which may affect quoted
companies generally. These factors could include the performance of the Company’s operations, large purchases
or sales of Shares or CDIs, liquidity (or absence of liquidity) in its Shares or CDIs, currency fluctuations, legislative
or regulatory changes (including changes in the tax regime in the jurisdiction in which the Company or its
investments operate), additions or departures of key personnel at the Company, adverse press, newspaper and
other media reports and general economic conditions. In addition, stock markets from time to time suffer
significant price and volume fluctuations that affect the market price for securities and which may be unrelated
to the Company’s performance. The value of the CDIs may therefore fluctuate and may not reflect their
underlying asset value.
Forward looking statements - This annual report contains forward-looking statements that involve risks and
uncertainties. The Company’s results could differ materially from those anticipated in the forward-looking
statements as a result of many factors, including the risks faced by the Company, which are described above and
elsewhere. Additional risks and uncertainties not currently known to the Directors may also have an adverse
effect on the Company’s business.
Force Majeure events – Force majeure events may occur within or outside the countries in which the Company
operates that could impact upon the operations of the Company and the price of the Shares CDIs. The events
include but are not limited to acts of terrorism, an outbreak of international hostilities, fires, floods, earthquakes,
labour strikes, civil wars, natural disasters, outbreaks of disease, pandemic or other natural or man-made events
or occurrences that can have an adverse effect on the demand for the Group’s services and its ability to conduct
business. The Company has only a limited ability to insure against some of these risks.
Specific Risks
(a)
Early stage development of the Assets - The assets in which the Company has an interest are at an early stage
of development. While the Brockham asset have historically produced oil they do not currently produce oil at
income generating levels and there can be no assurance that the drilling programmes, that are being sought to
be implemented in order to increase production, will be successful. In addition, the other oil and gas interests of
the Company detailed in this annual report are only at the exploration or appraisal stage and there can be no
assurance that they will eventually produce oil to income generating levels. If income generating levels of oil are
not produced from the Company’s assets, the Company’s revenue potential will be materially and adversely
impacted.
54
CORPORATE GOVERNANCE STATEMENT
Specific Risks
DORIEMUS PLC
(b)
(c)
(d)
Licensing, planning permission and other consents - The development of the Company’s current and future
assets may be dependent on the receipt and maintenance of planning permissions from relevant local authorities
as well as other necessary consents such as environmental permits, leases and regulatory consents including, in
particular, the grant and maintenance of appropriate permissions from, amongst others, the OGA
(Authorisations). The Company is not the operator of any of the licences that it holds interests in. As a result,
obtaining the necessary consents and approvals will be largely dependent on the operators of the licences taking
the necessary actions to obtain such Authorisations. Obtaining such Authorisations may be costly exercises, and
they may not be granted, may be withdrawn, may be challenged by local authorities, third parties and activists,
or made subject to limitations. For example, during March 2017 it was alleged by a local authority that drilling
conducted by the operator of the Brockham oil field was unauthorised in that planning permission was not
obtained. Such allegation has since been refuted by the operator and no further action has been taken to date
by the local authority or any other party, but it is illustrative of the risks that can arise for the Company. Onshore
oil and gas operations in the UK have also recently been subject to extensive planning and environmental
approval procedures, the outcomes of which have often been uncertain. Unforeseen circumstances or
circumstances beyond the control of the Company may also lead to commitments given to licencing authorities
not being discharged on time. The failure by the operators of the licences to gain the necessary Authorisations
on a timely basis or gain them on terms or at a cost acceptable to the Company may limit the Company in its
ability to extract value from its assets and could have a material adverse effect on the Company’s business,
results of operations, financial position and prospects.
No guarantee of success of any drilling programmes and the costs involved may be greater, and the returns
lower, than estimated - The Company will not generate any material income from its asset base fields unless
there is a successful completion of drilling programmes. There is no guarantee that this drilling will be successful
(and the Company notes the issues at the Brockham oil field). These investments also have a limited operating
history upon which to base estimates of proven and probable oil reserves and future cash operating costs. For
early stage projects, estimates of proven and probable oil reserves and cash operating costs are, to a large extent,
based upon the interpretation of geological data and feasibility studies which derive estimates of cash operating
costs based upon anticipated recoveries, expected recovery rates, comparable facility and equipment operating
costs, anticipated climatic conditions and other factors. As a result, it is possible that actual cash operating costs
and economic returns may differ materially from those estimated which may adversely impact the Company’s
financial position, revenue potential and ability to invest in other investments.
Reliance on partners and operators- The Company only has minor interest in its portfolio of assets and is
accordingly heavily reliant on its partners for the majority portion of the operating and development funding
required to exploit these oil fields. Various other participating parties are also responsible for the payment of
the costs to operate the oil fields. Any failure or delay in the provision of such funding by Angus Energy or the
payment of such costs by any of the other participating parties could cause a material delay in the exploitation
of these oil fields and as a result adversely affect the Company’s ability to implement its stated strategy and
consequentially its financial position and revenue potential. The Operators of these fields are also responsible
for adhering to the work programs in respect of those fields in the form approved by the OGA. A failure to adhere
to such work programs could result in the rescission of the permission by the OGA, which could result in the
Company losing its interest in these licences, which would adversely impact the Company and as a result
adversely affect the Company’s ability to implement its stated strategy and consequentially its financial position
and revenue potential.
55
CORPORATE GOVERNANCE STATEMENT
Specific Risks
DORIEMUS PLC
(e)
Over-run of drilling programme and costs - It may not be possible for the operators of the Company’s assets, to
adhere to agreed drilling schedules. This may impact the Company as a participant in the fields, and its future
plans. The final determination of whether to drill any scheduled or budgeted wells will depend on a number of
factors including:
(f)
(g)
(1)
(2)
(3)
(4)
(5)
results of the exploration efforts and the acquisition, review and analysis of seismic data, if any;
availability of sufficient capital resources for the drilling of the prospects;
approval of the prospects by other participants after additional data has been compiled;
economic and industry conditions at the time of drilling, including prevailing and anticipated processes
for oil and natural gas and the availability and prices of drilling rigs and crews; and
availability of leases, licence options, farm-outs, other rights to explore and permits on reasonable terms
for the prospects.
Although the relevant Operators, will at the time identify or budget for drilling prospects, it will require the
approval of all or a requisite majority of the participants in these licences. It may not be possible to drill those
prospects within the expected timeframe, or at all, and the drilling schedule, once agreed, may vary from its
expectations because of future uncertainties and rig availability and access to drilling locations. In addition, there
is a risk that no commercially productive oil or gas reservoirs will be discovered. If any of those circumstances
occur, they would adversely impact the Company’s revenue potential and financial position.
Exploration and development risks - Oil and gas exploration is a speculative investment and involves a high
degree of risk. There is no guarantee that exploration and development of the company’s asset portfolio, the or
any other oil and gas projects or interests that the Company has, or may acquire in the future, can be profitably
exploited. Oil and gas exploration, development and production activities are capital intensive and inherently
uncertain in their outcome. The Company’s projects may involve unprofitable efforts, either from dry wells or
from wells that are productive but do not produce sufficient net revenues to return a profit after development,
operating and other costs. Drilling, developing and operating projects involve a number of risks, many of which
are beyond the control of the Company, which may delay or adversely impact the exploration, development and
production activities that the Company has an interest in.
These delays and potential impacts could result in the activities being delayed or abandoned and substantial
losses could be incurred, all of which could adversely impact the Company. The oil industry historically has also
experienced periods of rapid cost increases. Increases in the cost of exploration, production and development
would affect the Company’s ability to invest in additional assets and also meet its funding obligations in respect
of the assets it has an interest in.
Development - the Company’s ability to achieve any production, development, operating cost and capital
expenditure estimates in a timely manner cannot be assured. Possible future development of oil and gas
exploration at any of the Company’s projects is subject to a number of risk factors including, but not limited to,
unfavorable geological conditions, failing to receive the necessary approvals from all relevant authorities and
parties, unseasonal weather patterns, unanticipated technical and operational difficulties encountered in
extraction and production activities, mechanical failure of operating plant and equipment, unexpected shortages
or increases in the price of consumables, spare parts and plant and equipment, cost overruns, risk of access to
the required level of funding and contracting risk from any third parties providing essential services. In the event
that the Company commences production, its operations may be disrupted by a variety of risks and hazards
which are beyond its control, including environmental hazards, industrial accidents, technical failures, labour
disputes, unusual or unexpected rock formations, flooding and extended interruptions due to inclement or
hazardous weather conditions and fires, explosions and other accidents. Such occurrences could result in
damage to, or destruction of, production facilities, personal injury or death, environmental damage, delays in
drilling, increased production costs and other monetary losses and possible legal liability to the owner or
operator of a mine. The Company may become subject to liability for pollution or other hazards against which
it has not insured or cannot insure, including those in respect of past drilling activities in an area for which it was
not responsible.
56
CORPORATE GOVERNANCE STATEMENT
Specific Risks
DORIEMUS PLC
(h)
(i)
(j)
(k)
(l)
(m)
Potential disposal of the Company’s historic UK assets - in the normal course of business of the Company’s
operations, it may become involved in, named as a party to, or be the subject of, various legal proceedings,
including regulatory proceedings, tax proceedings and legal actions, relating to personal injuries, property
damage, property taxes, land rights, the environment and contractual disputes. The outcome of any future
litigation cannot be predicted with certainty. There can be no guarantee that the Company will be able to dispose
of these assets on favourable terms or at all. Should the Company be unable to dispose of these assets any
litigation or dispute in relation to these assets in the future may have a material adverse effect on the Company’s
assets, liabilities, business, financial condition and results of operations.
Oil and natural gas prices volatility - the Company’s prospects and the market price of its quoted securities be
influenced by the price obtained from time to time for oil, natural gas and petroleum products. Oil and gas prices
fluctuate and are affected by numerous factors beyond the control of the Company. These factors include
worldwide and regional supply and demand for oil and gas, forward selling by producers and production cost
levels, general world economic conditions and the outlook for interest rates, inflation and other economic factors
on both a regional and global basis. These factors may have a positive or negative effect on the Company's
exploration, project development and production plans and activities, together with the ability to fund those
plans and activities.
Funding risk - Although the Directors believe that, on completion of the Offer, the Company will have sufficient
working capital to carry out its short term objectives, there can be no assurance that each objective can be met
without further financing, or if further financing is necessary, that financing can be obtained on favourable terms
or at all. In addition, the Company may require capital in addition to the amount being sought in the Offer to
continue exploring and appraising its existing assets following the completion of the existing work program
budgets. As and when further funds are required, either for the existing assets or for acquisitions, the Company
will consider raising additional capital from both the issue of equity securities and/or debt finance if appropriate.
There is no assurance that the Company will be able to access and secure additional funding on reasonable terms
or at all.
Reliance on key personnel - The Company’s success depends in part on the Directors being able to identify
potential investment and/or acquisition opportunities, and to implement the Company’s business strategy. The
loss of the services of any of the Directors could materially and adversely affect the Company. In addition,
although the Company and the Directors will evaluate the risks inherent in a particular investment, they cannot
offer any assurance that a proper discovery, or a complete assessment of all significant risk factors associated
with the investment, can be made.
Resource estimation risk - There are inherent risks in the estimation of contingent resources including the
estimates included in this annual report. There is a risk that such estimations will not convert into reserves or
any actual production may significantly vary from such estimations, which may adversely impact the Company’s
revenue potential and financial position.
Rehabilitation cost risk - In relation to the Company’s historic and future planned exploration programs, issues
could arise with respect to abandonment costs, consequential clean-up costs, environmental concerns and other
liabilities. In most of these instances, the Company could become subject to liability if, for example, there is
environmental pollution or damage from the Company’s exploration activities and there are consequential clean-
up costs at a later point in time. While the Company has received no firm claims or advices, it remains possible
that such claims could arise and could materially adversely affect the financial position and performance of the
Company. Additionally, the Company estimates abandonment and rehabilitation costs based on current
understandings. There is no guarantee that actual costs will not be higher than are currently estimated.
Regulators may also, over time, impose higher standards for these activities which may increase the associated
costs. This may adversely affect the financial position and performance of the Company.
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CORPORATE GOVERNANCE STATEMENT
Specific Risks
DORIEMUS PLC
(n)
(o)
(p)
Potential acquisitions - As part of its business strategy, the Company may make acquisitions or significant
investments in which it believes there is scope to improve the underlying value of the Company and to further
its strategic goals. Any such transactions will be accompanied by risks commonly encountered in making such
acquisitions as well as risks such as access to additional capital. There are also inherent risks with acquisitions,
including that the acquired assets do not fulfil the acquisition criteria. Acquisitions may change the Company’s
future capital and operating expenditure requirements, and hence funding requirements. Acquisitions can give
rise to liabilities. It is possible that operational and financial underperformance of the acquired assets including
additional costs and/or liabilities may negatively impact on the financial performance of the Company and
potentially impact member returns.
Joint venture partners - Financial failure or default by any participant in a joint venture to which the Company
is a party may have a material adverse effect on the Company insofar as it may have to bear that share of the
joint venture costs which would otherwise have been borne by the relevant participant in the joint venture.
The Company will also be required in future to negotiate agreements with additional third parties. These
agreements may include but are not limited to contracts with service providers, product sales agreements, joint
venture agreements, agreements with landowners, access to third party facilities and permit terms with
regulators. If the outcomes of these negotiations are not favourable to the Company then the Company’s
financial performance may be adversely impacted.
Litigation - While the Company currently has no material outstanding litigation or dispute, there can be no
guarantee that the current or future actions of the Company or of the other parties which have interests in the
same assets as the Company will not result in litigation since there have been a number of cases where the rights
and privileges of natural resource companies have been the subject of litigation. The oil and gas industries, as
with all industries, may be subject to legal claims including personal injury claims, both with and without merit,
from time to time. The Directors cannot preclude that such litigation may be brought against the Company or its
assets in the future.
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