PANCONTINENTAL OIL & GA
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288 Stirling Street
Perth WA 6000
Telephone: +61 8 9227 3220
Fax: +61 8 9227 3211
Contents
Chairman’s Review
Review of Operations
Directors’ Report
Auditor’s Independence Declaration
Corporate Governance Statement
Statement of Comprehensive Income
Statement of Financial Position
Statement of Changes in Equity
Statement of Cash Flows
Notes to the Financial Statements
Directors’ Declaration
Independent Audit Report
Additional ASX Information
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Pancontinental oil & Gas nl | Annual Report 2012
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Chairman’s Review
Review of Operations
Chairman’s Review
I am very pleased to report on a significant year for
Pancontinental Oil and Gas NL.
that these will grow and mature as exploration continues.
The Company is being increasingly recognised globally
for its efforts in Africa, particularly in our East African
projects in Kenya and also in Namibia. Both regions have
become international focuses for oil and gas exploration,
and Pancontinental is one of the very few juniors active in
these outstanding regions.
In a significant achievement during the 2011 / 2012 year,
Pancontinental raised $65 million (before costs) through
equity issues to fund its African exploration campaigns.
The two fundraisings were subscribed by some of world’s
largest international investment funds, a considerable vote
of confidence for our Company’s direction, strategy,
management and asset portfolio.
to our projects,
the East African margin
Turning
continues
to host major gas discoveries offshore
Mozambique and southern Tanzania. Pancontinental is
exploring in the northern part of the East African margin,
and here we have four exploration areas offshore Kenya.
The Company, after some years of planning, has made a
gas discovery in its Mbawa 1 well offshore Kenya, drilled
by our operator Apache Corporation over August and
September this year. This is the first ever discovery
offshore Kenya and the first discovery of any kind in the
northern part of the East African offshore margin. This
ground breaking discovery continues to be evaluated and,
whatever the outcome of the evaluation, Pancontinental
has succeeded proving a working hydrocarbon system,
for much greater exploration
opening
opportunities offshore Kenya. Notably,
it was
Pancontinental that originated this project some years
ago.
the door
The gas discovery at Mbawa does not mean that oil will
not be found offshore Kenya, and we continue to direct
our efforts towards the oil in this region.
In virtually all frontier areas, the first discovery paves the
way for much better informed, and often more successful,
future exploration. The numerous very large prospects
and the diversity of play types, in our Kenyan licences
comprise, a multi-layered series of opportunities in a
geological as well as strategic sense, and we are confident
High quality 3D seismic has become a key to finding
hydrocarbons, and in our Kenyan areas, we participated
in three new surveys during the year and have another
survey planned for November this year. This gives some
indication of the enthusiasm of our joint ventures for
exploration offshore Kenya.
Pancontinental’s other main African focus region is
offshore Namibia. Our work here, in the 0037 licence, has
succeeded in identifying a significant number of ponded
turbidites, basin floor fans and slope and basin floor
channel features. Some of these are extremely large. We
continue to believe that our concept of exploring in the so
called “Inner Graben” in the Walvis Basin holds true and
we maintain our support for the concept that this is where
oil is most likely to be found.
Throughout the 2011 / 2012 year Pancontinental has
continued to assess a number of acquisition opportunities,
primarily African focussed, with the aim of significantly
growing our oil and gas portfolio. During the year, the
Company had opportunity to increase its interest from
85% to 95% in the very large Namibian EL 0037 licence
area (c.17,000 sq km) by acquiring an extra 10% from our
co-venturer Paragon Holdings. In its own right and
measured against other acquisitions offshore Namibia we
believe that the acquisition allowed Pancontinental to
capture significant value.
Considerable interest has been shown in EL 0037 by
other companies exploring regionally and, although we
intend to maintain a significant stake in EL 0037, we are
considering a farm out that will enhance and accelerate
the work programme.
Two wells have been drilled by others offshore Namibia
so far this year. Neither were discoveries, however the
geology is now becoming much better known and we
expect better success from a minimum of four more wells
to be drilled over the coming months offshore Namibia.
Pancontinental holds a unique position in two of the
newest oil and gas frontiers globally [Kenya and
Namibia], where both regions are on the cusp of game-
changing drilling programmes. With approximately $48
million in cash at year end, Pancontinental is well funded
for an exciting 12-18 months ahead.
H.D. Kennedy
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Image 1
Review of Operations
PANCONTINENTAL OIL & GAS
PROJECT LOCATIONS
AUSTRALIA
ONSHORE
Canning Basin
• EP 104 / R1
• L15
NAMIBIA OFFSHORE
Walvis Basin
• EL 0037
KENYA OFFSHORE
Lamu Basin
• L6
• L8
• L10A
• L10B
Image 2
AUSTRALIA OFFSHORE
/ ONSHORE
Carnarvon Basin
• EP 424
• EP 110
LICENCE
Kenya L6
Kenya L8
Area (km2)
PCL Interest
(%)
Operator (%)
Co- Venturers (%)
3,100
40.0%
FAR (60%)
FAR (60%)
5,115
15.0%*
Apache (50%)
Apache (50%) Origin Energy (20%),
Tullow (15%)
Kenya L10A
4,962
15.0%
BG Group (40%)
Kenya L10B
5,585
15.0%
BG Group (45%)
Namibia EL0037
17,295
95.0%
Pancontinental
(95%)
Strike Oil
(61.5%)
Strike Oil
(61.5%)
79
38.5%
750
38.5%
736
10.0%
EP 424
(Australia)
EP 110
(Australia)
EP 104 / R1
(Australia)
L15
(Australia)
Buru Energy
(38.95%)
Buru Energy (38.95%) Emerald Gas (12.75%),
Gulliver (14.8%), Phoenix Resources (10%),
FAR (8%), Indigo Oil (5.5%)
150
12.0%
Buru Energy
(15.5%)
Buru Energy (15.5%) Gulliver (49%), FAR
(12%), Indigo Oil (11.5%)
BG (40%) PTTEP (25%),
Premier (20%)
BG (45%) PTTEP (15%),
Premier (25%)
Paragon Holdings (5%)
Strike Oil
(61.5%)
Strike Oil
(61.5%)
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Highlights
Kenya L8 –The first ever discovery offshore Kenya made by the Mbawa 1 well, in September 2012, proving a working
hydrocarbon system and establishing a gas accumulation.
Nanaa 3D survey completed early 2012.
Kenya L10A & L10B – 3D and 2D seismic surveys identify multiple prospects.
An additional 3D survey is planned for November 2012.
Kenya L6- Kifaru 3D survey completed over Kifaru and Tembo Prospects.
Namibia EL 0037 – Pancontinental increased its interest in EL 0037 to 95%.
Multiple leads identified from mapping.
Corporate - The Company raised approximately $65 million dollars (before costs) to further its exploration activities.
Pancontinental continues to assess a number of acquisition opportunities, with a primary African focus.
INTERNATIONAL
KENYA
Pancontinental’s Strategy Offshore Kenya
Kenya’s stable legal and fiscal regimes and Pancontinental’s strong acreage position place the company very favourably in
the East African region.
Image 3
Offshore East Africa has become an industry exploration focus through recent major deepwater gas discoveries and an oil
discovery offshore Tanzania and Mozambique.
Tana River sediment / oil
source nutrient input
Davie- Walu Ridge
restricting oceanic
circulation
Hydrocarbon
generating
troughs
L6
L8
L10A
L10B
Pancontinental originally proposed that the prime areas to develop good oil source rocks, and to have these fully mature to
generate oil, is the restricted environment where the Tana River delta carried sediments and nutrients into the deep troughs
inboard of the Davie Walu Ridge.
Pancontinental has identified a major oil and gas play offshore Kenya and has acquired four licence areas. Exploration in this
region is increasing, and it has become a major focus after the Mbawa gas discovery in September 2012 (Pancontinental
15%).
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OFFSHORE KENYA
Image 4
Kenya
L6
L8
L10A
L10B
Tanzania
0 Km 100
-------------
L6 - 3,100km2
FAR 60%
Pancontinental 40%
L8 - 5,115km2
Apache 50%
Origin 20%
Pancontinental 15%
Tullow 15%
L10A - 4,962km2
BG Group 40%
PTTEP 25%
Premier 20%
Pancontinental 15%
L10B - 5,585km2
BG Group 45%
Premier 25%
Pancontinental 15%
PTTEP 15%
South of Kenya, offshore northern Mozambique and southern Tanzania, drilling continues unabated after a succession of
major gas discoveries and further drilling is also planned offshore Kenya by Pancontinental and its co-venturers, as well as
by Anadarko and Total in deeper water over the coming year.
With the 2011 awards of the L10A and L10B licences, Pancontinental has extended its strategy of exploring for oil to the
south of the L8 and L6 blocks. The new blocks cover the same deep Tertiary troughs that the company interprets to be oil-
generating in L8 and L6.
Pancontinental has participated in four 3D surveys offshore Kenyan and these have generated numerous Prospects and
Leads. Another 3D survey is planned in the L10 Blocks in November 2012.
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Lamu
OFFSHORE KENYA L6, L8, L10A, L10B
PROSPECTS AND LEADS MAP
(Various Sources)
L6
Mbawa 3D
Survey Area
-------------------------
0 Km 50
Image 5
Kifaru
Prospect
Kifaru 3D
Survey
Melindi
KENYA
L8
Mbawa
Prospect
Nanaa 3D Survey
Area Under
Evaluation
L10A
Mombasa
Miocene
Miocene
Miocene
Miocene
Reefs
Reefs
Reefs
Reefs
New 3D Area-
Acquisition Nov ‘12
L10B
Crombec Lead
L10A & L10B
3D Survey Area
Under Evaluation
The Mbawa Prospect is one of a number of prospects at different geological levels in the L8 area and the first to be drilled
out of numerous prospects and leads in Pancontinental’s four licence areas offshore Kenya.
The Mbawa gas discovery establishes the existence of a working hydrocarbon system offshore Kenya. The source material
of the gas is interpreted to be a thermally mature mixed gas and oil- prone source and this means that oil may also have been
generated at some time from the same source rock. With the Mbawa 1 gas discovery and the proving of a working
hydrocarbon system, Pancontinental believes that the next 12-18 months will be a defining period of exploration offshore
Kenya.
The opportunity to discover oil has by no means been dispelled by finding gas at Mbawa. Trace fluorescence seen in Mbawa
may be a significant clue and it is being closely examined.
Pancontinental is well funded for exposure to up to 4 offshore Kenyan wells directly (1 well depends on the completion of
farmout in Block L6) and up to 4 wells offshore Kenya indirectly (wells by other companies) over the coming 12-18 months.
Pancontinental believes that we have seen only the beginning of what will become a wave of discoveries offshore Kenya.
KENYA
Block L8, offshore Lamu Basin
Pancontinental 15%
L8 covers 5,114.9 sq km offshore Kenya in the Lamu Basin in water depths from 100m to 1,300 m. Pancontinental and its
co-venturer (and subsequent merger partner) Afrex Ltd originated the L8 and L6 projects.
L8 holds the semi-regional Mbawa Prospect, a gas discovery in September 2012.
Pancontinental farmed out an interest in L8 to Origin in 2005, with Origin fully funding a 2D seismic survey and a 3D
seismic survey over the Mbawa Prospect. Pancontinental retained a 25% interest following the 3D survey and has now
farmed-down to Tullow and retained a 15% interest through Mbawa drilling. Tullow has an option to earn another 5% from
Pancontinental.
In L8, the largest of several very substantial exploration objectives is the Mbawa Prospect, an anticlinal structure mapped
using the 3D seismic data. Mbawa shows superposed “flat spots” or “DHI’s” on both 2D and 3D seismic data and has
interpreted sea- floor oil seepages from its northern flank.
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The interpreted extensive deep oil and gas generating “kitchen” near the Mbawa Prospect extends to the north into area L6
and south into L10A and L10B.
After Mbawa, the next largest prospect is Nanaa Central with approximately 40% of Mbawa’s volumetric potential. Other
major Prospects include the Tai Prospect.
Mbawa Discovery
The Mbawa Prospect is one of a number of prospects in the L8 licence area and the first to be drilled out of numerous
prospects and leads in Pancontinental’s four licence areas offshore Kenya.
The Mbawa 1 exploration well was spudded by the drillship Deep Sea Metro 1 on 10 August 2012 and drilled to a TD of
3,150m MD. This is the first well on the large Mbawa Prospect in area L8 offshore Kenya (Apache Corporation 50%, Origin
Energy 20%, Pancontinental 15%, Tullow Oil 15%). The well was plugged and abandoned according to the drilling
programme and has been left in a state that allows re-entry at a later date.
Operator Apache Corporation (“Apache”) completed well operations in 47 days, being 13 days ahead of schedule.
Mbawa 1 is the first ever Natural Gas discovery and the first ever hydrocarbon (oil or gas) discovery offshore Kenya. The
well proves the existence of a working hydrocarbon system that, in the case of the Mbawa gas, is interpreted to be derived
from a mature Type II (gas / oil) source. Traces of dull fluorescence remain to be analysed and interpreted.
Image 6
Mbawa 1 is a substantive gas discovery; however the volume of gas discovered and the follow-up potential remain to be
determined by ongoing work.
Preliminary interpretation of the Mbawa 1 results has been provided to the L8 joint venture by the operator Apache. Further
analysis of the rock and fluid samples and other technical data will continue into 2013.
Mbawa 1 tested a 31 sq km (7,800 acre) faulted four- way dip closure. The closure comprises the southern end of the larger
north-south trending four-way closed sub-regional Mbawa Prospect of 160 sq km (40,000 acre). The primary target was the
Upper Cretaceous turbidite sandstones. Secondary objectives were Eocene and Middle Cretaceous turbidite reservoirs.
At the primary target level, 51.8 net metres (~170 feet) of natural gas pay were encountered in three zones of Upper
Cretaceous channel and turbidite sandstones. Porosities were very favourable at an average of approximately 24%. The
discovery was on a single localised structural culmination on the southern extremity of the overall Mbawa Prospect and the
potential of the remainder of the structure remains to be assessed in the light of the Mbawa results.
The well was designed to optimally test the shallower Upper Cretaceous discovery target, however it was not possible to also
optimally test the deeper secondary Middle Cretaceous target. The deeper target remains to be properly tested and
Pancontinental believes that this, as well as other prospects of this play type, and the Mbawa discovery play type itself still
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hold considerable potential in the Mbawa vicinity, elsewhere in the L8 area and regionally.
Fluid samples, pressure measurements, electronic logs and sidewalls cores were taken while drilling and these continue to be
analysed and interpreted.
The size of the gas discovery continues to be evaluated, as well as the follow - up potential in other culminations on the
Mbawa structure, the potential in nearby structures and the commercial potential (if any) of the overall structure at the depth
discovery.
The significance of traces of dull fluorescence seen while drilling will be further interpreted once samples have been fully
analysed.
Gas recovered from the discovery zone is interpreted to be thermogenic and derived from a possible Type II mixed gas / oil
source rock. The extent and age of this source rock is subject to further analysis. Pancontinental believes that this very
encouraging finding means that the potential for oil discoveries remains open and there may also be further extensive gas
resources both locally and regionally.
This first ever discovery in Mbawa has reversed the earlier perception created by the results of the Pombo 1 well drilled by
Woodside Energy in 2007 that there was no source rock offshore Kenya. It has substantially increased the attractiveness of
Image 7
all of Pancontinental’s Kenyan acreage and further de-risked its Kenyan prospects and leads.
800m WATER DEPTH
MBAWA 1 GAS DISCOVERY
51.8 M NET GAS PAY IN
MAIN CRETACEOUS TARGET
DEEPER SECONDARY
CRETACEOUS TARGET
DRILLED OFF-AXIS
Seismic Cross-Section Through Mbawa Prospect
The Mbawa 1 exploration well has proven a working hydrocarbon system offshore Kenya in the Cretaceous; this has opened
a new hydrocarbon region offshore East Africa.
L8 - Forward Exploration Programme
The large amount of technical data gathered during Mbawa drilling is now being processed and assessed. It will be integrated
into previous exploration models.
The L8 Joint Venture is currently considering a second well in 2013, however a firm decision to drill the well, the play type,
prospect and location have yet to be fully determined. Although no firm decision to drill a second well has been made, the
Mbawa 3D seismic survey and the more recent Nanaa 3D survey areas are currently the prime areas of consideration.
The Tai Prospect is one of the main prospects under consideration. The Tai Sands of interpreted Middle Cretaceous age are
deeper than the sands at the discovery level in Mbawa 1 and are considered to potentially be in a separate petroleum system.
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Image 8
Tai Prospect- Follow Up to Mbawa
220 Million Bbls Oil Potential (P Mean)
-------------
2 Km
130 m
-
-
-
-
-
Tai Sands
Seismic Cross Section through Tai Prospect
Nanaa 3D Seismic Completed
Pancontinental announced the completion of the Nanaa 3D seismic survey in L8 offshore Kenya in March 2012. The survey
is in addition and immediately adjacent to the earlier Mbawa 3D survey.
The survey covers approximately 1,400 sq km over the large Nanaa and Kozi Leads at levels from the Tertiary to the
Jurassic as well as covering the large Bundi and Tai Prospects in the Cretaceous to the Upper Jurassic in the southeast of L8.
Data processing and interpretation are expected to be completed by the end of 2012. Mbawa and the newly covered leads are
interpreted to be located in optimal positions to trap oil and gas generated in the basin.
Pancontinental has been be free-carried through the Nanaa 3D by farminee Tullow Kenya B.V. a wholly owned subsidiary of
Tullow Oil plc.
The new 3D seismic and the enthusiasm of the joint venture in accelerating exploration in L8 supports Pancontinental’s
long-held view of the very positive petroleum prospectivity of this region offshore Kenya.
When fully processed and interpreted, the new Nanaa 3D survey should add considerable volumetric potential to the L8
inventory of hydrocarbon prospects and leads and, in the event of success on Mbawa, Pancontinental expects to have a
substantial ready-made inventory of follow-up opportunities for drilling.
KENYA
Blocks L10A & L10B, Offshore Lamu Basin
Pancontinental 15%
Pancontinental joined the UK major BG Group and other UK companies Premier Holdings and Cove Energy in the award of
two new Production Sharing Contracts (“PSCs”) over Blocks L10A and L10B in 2011.
The new areas more than doubled Pancontinental’s gross acreage position offshore Kenya.
With BG as operator, the Joint Venture has commenced an aggressive “fast track” exploration programme leading to drilling
in this highly promising exploration province. Pancontinental is commencing exploration activities alongside several of the
most successful UK-based companies in the oil and gas sector.
The L10A and L10B Blocks have respective areas of 4,962.03 sq km and 5,585.35 sq km and water depths of 200 to 1,900m,
which is easily within the reach of modern drilling and development technology.
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Image 9
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An initial review by operator BG Group identified more than ten strong “leads” for follow-up by 3D and 2D seismic surveys.
The leads are geologically varied, with six “play types” identified.
Since the identification of the initial leads, 3D and 2D seismic surveys have been acquired in late 2011/early 2012 and one
well is planned in each block before mid-2014. The 3D and 2D mapping has identified a number of high priority prospects.
A further 3D survey is planned in November 2012 over an extensive Miocene Reef cluster and other key leads. The Joint
Venture is working towards commencing drilling operations in 2013.
3D and 2D Seismic Surveys- 2011/ 2012
The 3D survey of approximately 2,200 sq km covered 6 leads in the eastern part of the L10 Blocks, while the 2D survey of
970 linear km covered other leads, including a Miocene reef trend in the western part of the Blocks. The aim of the surveys
is to identify the most prospective prospects for drilling. Two wells are required under the licences in the second exploration
period commencing in August 2013.
Several of the leads have a similar character and are on-trend south of the giant Mbawa Prospect in L8 (Pancontinental 15%).
These leads are large anticlinal features.
A number of other leads have potential in different parts of the geological section, including a large Upper Jurassic “reef”,
Cretaceous and Tertiary channel and turbidite sands and Miocene reefs.
New 3D Survey to Commence November 2012
Following the promising initial results of the 2D and 3D seismic surveys completed in early 2012, the L10A and L10B joint
venture plans to carry out a new 3D survey of 2,280 sq km in the western portion of the licence areas.
The new 3D survey will cover a cluster of large Miocene reefs and the large Crombec Lead.
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Image 10
Sunbird Reef
Turaco Reef
Miocene Reefs- Seismic Example
These leads are possible drilling targets and the joint venture has scheduled the new 3D survey to start as soon as possible,
allowing for any equipment or planning constraints.
These leads are possible drilling targets and the joint venture has scheduled the new 3D survey to start as soon as possible,
allowing for any equipment or planning constraints.
The new 3D survey is planned to commence in November 2012 and full interpreted results are expected Q2 2013.
The new 3D survey is planned to commence in November 2012 and full interpreted results are expected Q2 2013.
Processing and interpretation of the 2D and 3D data acquired late in 2011 and early in 2012 is ongoing and preliminary
results are very encouraging.
Processing and interpretation of the 2D and 3D data acquired late in 2011 and early in 2012 is ongoing and preliminary
results are very encouraging.
Current Mapping - Western Area 2D
The L10A and L10B operator BG Group has mapped a number of leads for further work and possible drilling. These will be
Current Mapping - Western Area 2D
covered by the new 3D survey. The largest leads to be targeted by the new 3D survey are –
The L10A and L10B operator BG Group has mapped a number of leads for further work and possible drilling. These will be
(i) A cluster of more than 10 potential Miocene Reefs that appears to be mainly restricted to the L10 areas. Miocene reefs
covered by the new 3D survey. The largest leads to be targeted by the new 3D survey are –
are known globally to have very high per-well oil and gas production potential. The Miocene reefs are in water depths of
(i) A cluster of more than 10 potential Miocene Reefs that appears to be mainly restricted to the L10 areas. Miocene reefs
approximately 500m and within 50km of the major Kenyan port of Mombasa.
are known globally to have very high per-well oil and gas production potential. The Miocene reefs are in water depths of
approximately 500m and within 50km of the major Kenyan port of Mombasa.
(ii) The Crombec Lead is a large anticline in the western portion of the licence areas. Crombec has apparent four-way dip
closure from the Lower Jurassic to the Tertiary. It has sands onlapping the crest, indicating a likely growth structure. A
(ii) The Crombec Lead is a large anticline in the western portion of the licence areas. Crombec has apparent four-way dip
possible geological analogue is the Songo-Songo field in Tanzania.
closure from the Lower Jurassic to the Tertiary. It has sands onlapping the crest, indicating a likely growth structure. A
possible geological analogue is the Songo-Songo field in Tanzania.
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Image 11
Crombec Lead
Crombec Lead- Seismic Example
Current Mapping - Eastern Area 3D
Mapping continues on a number of Prospects and Play Types in the 3D data set acquired late in 2011 and early in 2012. Two
examples of the diverse play types are –
Image 12
(i) An extensive system of Tertiary channels. The Tertiary section holds most of the gas discovered to date offshore
Mozambique and Tanzania. The channels in L10A & L10B may be gas charged, possibly representing a large gas resource.
Tertiary Channels-
From 3D Representation
Tertiary Channels-
Time Slice
Tertiary Channels- 3D Seismic Maps
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Image 13
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(ii) Structural Leads in the Tertiary to Cretaceous section. The Longclaw Lead is an example of a dip reversal associated
with a fault. It shows stacked potential within the Tertiary stacked channels and Cretaceous thrust and sub-thrust plays.
Amplitude anomalies and “Flat Spots” support an interpretation of gas charging. Indications of gas flags on highs give
positive indications of charge.
Longclaw Lead - Seismic Example
Interpreted Flat
Events
Longclaw Lead-
Tertiary to
Cretaceous Section
Forward Programme
Modern high quality 3D seismic surveying is now able to provide high-definition images of subsurface structures and this
has proven to be highly successful in the discoveries offshore Mozambique, Tanzania and now Kenya.
While the results of the recent Mbawa 1 discovery well offshore Kenya (Licence L8) are still being evaluated, the Mbawa 1
gas discovery proves there is a working hydrocarbon system offshore Kenya and provides significant encouragement for
future exploration in L10A and L10B.
The Joint Venture plans to carry out a new 3D seismic survey commencing in November 2012.
The Joint Venture is considering commencing drilling operations in L10A and L10B in 2013. Final drilling decisions will be
made as work proceeds on the existing 3D and 2D data and the new planned 3D seismic survey. The Joint Venture is
pursuing both oil and gas opportunities in the L10 blocks.
Other planned work includes geological field sampling, gravity field attribute studies, heat flow modelling, seismic test
reprocessing, basin modelling and seismic attribute studies.
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KENYA
Block L6, Offshore / Onshore Lamu Basin
Pancontinental 40%
The L6 licence area covers approximately 3,100 sq km. Approximately one quarter of the area lies onshore and the rest
extends offshore to 400 metres water depth. L6 is adjacent and geologically continuous to L8.
L6 lies in the Tana River Delta and within the Lamu Basin, off the Kenyan coast, with a deep sedimentary section extending
from the Tertiary to at least the Jurassic.
Following encouraging hydrocarbon generation and migration studies, the joint venture is exploring the offshore portion of
the licence area. A deep central graben in this area is considered to be oil and gas “source kitchen” and potential hydrocarbon
trapping prospects have been identified immediately adjacent to this area.
The largest prospect is the Kifaru Prospect in water depths of 80m to 100m in the southwest of the L6 area. This prospect
and several others have been covered by a 3D seismic survey.
Pancontinental expects that the 3D survey will lead to the identification of one or more locations for drilling in 2013 / 2014.
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Image 15
Kudu
KENYA L6
PROSPECTS &
LEADS MAP
L6
Chui
Nyati
Kifaru
Kiboko
East
Image 16
Tembo
Kiboko
Completion of Kifaru 3D Offshore Seismic Survey
Completion of Kifaru 3D Offshore Seismic Survey
The Kifaru 3D seismic survey data acquisition was completed in offshore Kenya during July 2012. The final data acquisition
The Kifaru 3D seismic survey data acquisition was completed in offshore Kenya during July 2012. The final data acquisition
covered 778 sq km over several prospects, including the primary Kifaru Prospect, in the southern portion of the L6 licence
covered 778 sq km over several prospects, including the primary Kifaru Prospect, in the southern portion of the L6 licence
area.
area.
Pancontinental has a 40% interest in the L6 licence, with the remaining 60% held by the operator FAR Limited.
Pancontinental has a 40% interest in the L6 licence, with the remaining 60% held by the operator FAR Limited.
The data will now be processed and interpreted and it is anticipated that one or more prospects will be fully defined for
The data will now be processed and interpreted and it is anticipated that one or more prospects will be fully defined for
drilling, planned for some time in 2013.
drilling, planned for some time in 2013.
KIFARU 3D SEISMIC
SURVEY LOCATION
Offshore, sea-surface oil or condensate slicks are interpreted to originate from the sea floor in the south of L6, supporting the
Offshore, sea-surface oil or condensate slicks are interpreted to originate from the sea floor in the south of L6, supporting the
interpretation of a working hydrocarbon system in this under-explored region.
interpretation of a working hydrocarbon system in this under-explored region.
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Review of Operations
Review of Operations
The attention of the joint venture has shifted from the gas / condensate potential onshore to the larger oil and gas potential
offshore. Significant new studies in L6, including those interpreting hydrocarbon migration paths, have highlighted the
potential of areas adjacent to the central graben.
Several major prospects in L6 have potential in excess of 100 million barrels recoverable oil or 0.5 trillion cubic feet of gas.
Eight prospects have been mapped in five clusters:
The Kifaru Prospects in the southwest of the block in water depths of 60 metres (Kifaru N) and 100 metres (Kifaru
S). These Prospects are now one of the main focuses of exploration work;
The Kiboko and Nyati clusters are large and well situated in water depths from 100 metres to 350 metres;
The Chui Prospects are large features in near-shore water depths up to 120 metres; and
The Kudu Prospect, being onshore, is located where a smaller gas or oil discovery could be readily commercialised.
Forward Programme
With the increasing recognition of the hydrocarbon potential offshore Kenya, the joint venture is seeking a farminee for
drilling.
Planning has commenced for drilling in 2013. The location, depth and stratigraphy of the well will be determined after
interpretation of the 3D seismic data acquired earlier in 2012.
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3
Review of Operations
Review of Operations
NAMIBIA
EL 0037 Offshore Walvis Basin
Pancontinental 95%
Pancontinental and co-venturer Paragon Investment Holdings Pty Limited (“Paragon”) were awarded the 0037 Exploration
Licence by the Ministry of Mines and Energy of Namibia on 28 June 2011 and a corresponding Production Agreement was
signed on 4 July 2011 (also effective 28 June 2011). The EL 0037 licence covers 17,295 sq km in the Walvis Basin.
The location of the EL was selected over Blocks 2012B, 2112A and 2113B from a 30,000 sq km Reconnaissance Licence
awarded to Pancontinental in February 2007.
The EL gives exclusive rights to the holders for a first exploration period of four years followed by two additional periods of
two years each and also provisions for the continuation of the exclusive rights under any oil or gas development.
Image 17
NAMIBIA EL 0037
•
Pancontinental 85% & Operator
17,295 km2 offshore
•
•
Awarded June 2011
• Water depth 0 - 1,500m
•
•
•
Turbidites, ponded fans, channels in graben and slope setting
Excellent regional source rock, oil maturity and reservoir/seal
Studies, seismic then drilling
NAMIBIA EL 0037
Fully Oil-Mature Source Rocks in “Inner Graben”
Natural Oil Seepage “Bullseye” over Inner
Graben in EL 0037
(Data Source : HRT)
EL 0037
Predicted Present-Day
Maturity for Early Aptian
Source Rock
EL 0037 covers an extensive part of an “Inner Graben”, a geological trough that Pancontinental believes to be one of the
limited oil-generating “fairways” offshore Northern Namibia.
Offshore Namibia is part of the plate tectonic “conjugate” of offshore Brazil, where world-scale oil and gas discoveries have
been made in recent years and it lies on the West African continental margin adjacent to Angola, where there have also been
many major oil discoveries. The explorations “plays” in the Blocks are similar to some of those containing large oil and gas
reserves offshore elsewhere in West Africa.
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19
Review of Operations
Review of Operations
Image 18
TECTONIC PLATE RECONSTRUCTION - EARLY CRETACEOUS
OIL & GAS DISCOVERIES TO DATE
AFRICA
Espirito Santo
Basin
Campos Basin
14 Billion BOE
SOUTH
AMERICA
Santos Basin
30 Billion BOE
Offshore Nigeria
1Billion BOE
Offshore
Angola
16+ Billion BOE
Offshore
Namibia
? Billion BOE
Orange Basin
8+ Tcf
(including
Kudu 3Tcf
Offshore Namibia is an extension of the West African continental margin and in Pancontinental’s opinion offshore Namibia
has the potential to hold very large oil and gas reserves and it is significantly under-explored. The very large Kudu Gas Field
offshore Namibia is under development by Tullow Oil plc, and other companies are actively exploring the margin for oil.
Pancontinental acquires additional 10%
Pancontinental acquires additional 10%
In July 2012, Pancontinental reached agreement with EL 0037 co-venturer Paragon for Pancontinental to purchase a further
10% interest from Paragon in the EL 0037 licence for US$4 million. Ministerial approval of the transaction was granted and
the transfer has been completed.
The transaction reduces Paragon’s interest in EL 0037 to 5% and increases Pancontinental’s interest to 95%. Pancontinental
is the operator of the EL 0037 Joint Venture.
Measured against other Namibian transactions, Pancontinental believes that the acquisition was worthwhile and financially
sound and Pancontinental is now one of the largest net acreage holders offshore Namibia.
We have had considerable interest shown in EL 0037 by other companies exploring regionally and while we intend to
maintain a significant stake in EL0037, we are considering a farmout that will enable an acceleration of the work
programme.
EL 0037 Exploration Potential
Pancontinental believes that EL 0037 is one of the few areas covering an oil generating “sweet spot” where oil prone source
rocks are sufficiently buried to generate oil; similar to its four projects offshore Kenya.
Pancontinental is exploring ponded basin floor turbidites, slope fans and channels seen under the company’s earlier
Reconnaissance Licence. These targets are associated with a restricted graben trough interpreted to hold the rich and mature
oil source rocks identified in regional wells.
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Pancontinental Oil & Gas NL Annual Report 2012
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Review of Operations
Review of Operations
Review of Operations
Review of Operations
Image 19
NAMIBIA – PROSPECTIVITY
W
EL LOCATION
E
3
4
5
Base Tertiary to Breakup
Unconformity interpretation–
A package of rich oil source rocks,
reservoirs and seals
Oil Source Rocks
Early Cretaceous
OUTER HIGH TREND
Ponded Turbidites & Basin Floor
Fans
Aeolian &
Shoreface
Sands
INNER GRABEN
Incised
Channels
Onlapping Turbidites
SLOPE ENVIRONMENT
REGIONAL SCHEMATIC
CROSS -SECTION
BASIN FLOOR FAN
REGIONAL EXAMPLE
SEISMIC SECTION
INCISED CHANNELS
REGIONAL EXAMPLE
SEISMIC SECTION
RL No. 1 of 2007
Basin Floor Fan on-lapping “Outer High”
RL No. 1 of 2007
Lower Shelf Slope Confined Incised Channels
Image 20
Pancontinental has identified and mapped a number of ponded turbidite, slope turbidite, basin floor turbidite fans and
Pancontinental has identified and mapped a number of ponded turbidite, slope turbidite, basin floor turbidite fans and
Pancontinental has identified and mapped a number of ponded turbidite, slope turbidite, basin floor turbidite fans and
channels forming major very large “leads” closely associated with, and within, the Inner Graben in EL 0037.
channels forming major very large “leads” closely associated with, and within, the Inner Graben in EL 0037.
channels forming major very large “leads” closely associated with, and within, the Inner Graben in EL 0037.
A number of the leads exceed several hundred square kilometers in area based on current mapping, and detailed mapping
A number of the leads exceed several hundred square kilometers in area based on current mapping, and detailed mapping
A number of the leads exceed several hundred square kilometers in area based on current mapping, and detailed mapping
will be undertaken to define the full extent of the structural and stratigraphic closures and potential oil-bearing traps.
will be undertaken to define the full extent of the structural and stratigraphic closures and potential oil-bearing traps.
will be undertaken to define the full extent of the structural and stratigraphic closures and potential oil-bearing traps.
NAMIBIA EL 0037
LEADS AND PLAYS
BASE MAP
• Numerous very large Leads identified
• Highly varied Play types
• Good historic 2D
• Centrally positioned in predicted
oil-mature fairway “Inner Graben”
• High level of regional activity
BASIN FRAMEWORK
TRANSITION ZONE
OIL MATURE
FAIRWAY
---------------
0 Km 50
BASIN FLOOR
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Review of Operations
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Following several 3D seismic surveys in the last two years, a number of the joint ventures along the Namibian coastal
margin are now entering drilling phases.
Rigs have been secured and at least four wells will be drilled offshore Namibia in the next 12 to 18 months by operating
companies including Chariot, HRT and Petrobras in joint venture groups that include BP and Repsol. At least two wells are
anticipated in the vicinity of EL 0037. Recently two exploration wells proved to be non- commercial.
Farmout activity offshore Namibia has been active for some time. Most recently, Repsol SA farmed-in for drilling in the EL
0010 area, held by Tower and Arcadia and adjacent to Pancontinental’s EL 0037 area.
Also recently, BP announced a farmin to Serica’s licence south of EL 0037, under which BP will carry out more than 4,000
sq km of 3D seismic and then have an option to drill a well.
Offshore Namibia is continuing to attract significant international interest as an emerging oil and gas province in southwest
Africa.
Namibia EL 0037 – Leads
Image 21
C-M1
Transition
Zone
Channel
Basal Transition
Zone Channel
Syn-Rift
Channel
A-B 5
Transition
Zone Lower
Slope
Turbidite
Turonian
Flexure
Transition
Zone
Channel
O
M
C
A
B
E2
Transition Zone
Basin –Floor
Antiform
Santonian
Channel incised
into Turonian
Flat
Event
D5
Transition Zone
?Detached Basin-
Floor Fan
N
E
Dalia Field Angola
Flat
Event
21
D
The potential reservoir rocks lay close to the oil source rocks. Water depths are moderate by modern exploration standards,
with water depths between 0 and 1,500m in the Blocks being readily accessible for exploration.
The sparsely scattered well results show evidence of excellent oil prone source rocks and Pancontinental interprets that these
will be mature to generate oil in the Inner Graben covered by Pancontinental’s acreage. Other well results show excellent
reservoir rocks and seals.
Pancontinental’s 95% (increased from 85%) in the Blocks sees it well placed amongst some major players offshore Namibia.
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Review of Operations
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Forward Work Programme
Pancontinental has commenced gathering data over the new area and will remap existing seismic and map prospects and
leads for further work.
It is intended that 2D and 3D seismic data will be acquired over several prospects and drilling will be considered on the best
of these.
AUSTRALIA
EP 104 & RL1, onshore Canning Basin, Western Australia
Pancontinental 10%
Pancontinental holds a 10% interest in both licence EP 104 and an extension over Retention Licence R1 in the Canning
Basin in north-western Western Australia. The Canning Basin has a number of recognised petroleum systems, yet it remains
relatively under-explored.
AUSTRALIA – EP 104 / R1 & L15
Image 22
The RL1 area has been excised from the EP 104 exploration area to allow retention of the Point Torment gas discovery and
the Stokes Bay 1 area. RL1 was renewed by the Minister of Mines and Petroleum of Western Australia for a period of five
years from 8 November 2010.
The EP 104 and RL1 areas are on-trend to the Blina and other nearby oil fields and have similar exploration plays,
exploration targets and petroleum systems. The West Kora oil discovery is 18 kilometres southeast and the nearest gas
discovery, Point Torment-1, is 4.5 kilometres southeast of the Stokes Bay-1 well.
Stokes Bay-1 was drilled in 2007 to test any updip continuation of the Point Torment gas discovery. Stokes Bay 1 lost
circulation of drilling mud into cavernous and vugular porosity in the top 40 to 45 metres of the Nullara Limestone. During
operations to control the lost circulation Stokes Bay-1 flowed back mud intermittently.
Further testing attempted to lift sufficient lost drilling mud to induce the flow of formation fluid (oil, gas or water) from the
Nullara. Some gas was seen at the wellhead but again no definitive formation fluid was recovered.
During a further testing phase a coiled tubing unit (CTU) recovered saline water interpreted to be formation fluid.
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Review of Operations
Review of Operations
Review of Operations
Review of Operations
AUSTRALIA
AUSTRALIA
AUSTRALIA
L15, onshore canning basin, Western Australia
L15, onshore canning basin, Western Australia
L15, onshore canning basin, Western Australia
Pancontinental 12%
Pancontinental 12%
Pancontinental 12%
Pancontinental and several co-venturers were granted Production Licence L15 over the West Kora-1 oil discovery well in the
Pancontinental and several co-venturers were granted Production Licence L15 over the West Kora-1 oil discovery well in the
Pancontinental and several co-venturers were granted Production Licence L15 over the West Kora-1 oil discovery well in the
onshore Canning Basin of Western Australia in April 2010. West Kora-1 was drilled in 1984 to a depth of 2606 metres and
onshore Canning Basin of Western Australia in April 2010. West Kora-1 was drilled in 1984 to a depth of 2606 metres and
onshore Canning Basin of Western Australia in April 2010. West Kora-1 was drilled in 1984 to a depth of 2606 metres and
produced some 20,000 Barrels of oil with an initial rate of 350 BOPD.
produced some 20,000 Barrels of oil with an initial rate of 350 BOPD.
produced some 20,000 Barrels of oil with an initial rate of 350 BOPD.
The L15 covers two graticular blocks “6054 and 6126” and runs for 21 years from 1 April 2010.
The L15 covers two graticular blocks “6054 and 6126” and runs for 21 years from 1 April 2010.
The L15 covers two graticular blocks “6054 and 6126” and runs for 21 years from 1 April 2010.
West Kora-1 was drilled in 1984 and produced some 20,000 Barrels of oil during an extended production test, commencing
West Kora-1 was drilled in 1984 and produced some 20,000 Barrels of oil during an extended production test, commencing
West Kora-1 was drilled in 1984 and produced some 20,000 Barrels of oil during an extended production test, commencing
at a rate of 350 BOPD.
at a rate of 350 BOPD.
at a rate of 350 BOPD.
While drilling West Kora-1 the Carboniferous aged Anderson Formation demonstrated a number of oil shows. An extended
While drilling West Kora-1 the Carboniferous aged Anderson Formation demonstrated a number of oil shows. An extended
While drilling West Kora-1 the Carboniferous aged Anderson Formation demonstrated a number of oil shows. An extended
production test over the interval 1735-1751 metres in 1982 produced some 20,000 barrels of oil. The initial production rate was
production test over the interval 1735-1751 metres in 1982 produced some 20,000 barrels of oil. The initial production rate was
production test over the interval 1735-1751 metres in 1982 produced some 20,000 barrels of oil. The initial production rate was
350 BOPD with 30% water cut, declining to 15% oil cut / 85% water cut.
350 BOPD with 30% water cut, declining to 15% oil cut / 85% water cut.
350 BOPD with 30% water cut, declining to 15% oil cut / 85% water cut.
In 1992, the interval 1693 to 1696 (the “1700 metre oil sand”) was also perforated. A through-tubing bridge plug failed to isolate
In 1992, the interval 1693 to 1696 (the “1700 metre oil sand”) was also perforated. A through-tubing bridge plug failed to isolate
In 1992, the interval 1693 to 1696 (the “1700 metre oil sand”) was also perforated. A through-tubing bridge plug failed to isolate
water production in the well, considered to be likely from the lower perforated intervals.
water production in the well, considered to be likely from the lower perforated intervals.
water production in the well, considered to be likely from the lower perforated intervals.
Additional Extended Production Tests were conducted in 1992 and 1997 / 1998. The results demonstrated the need for a
Additional Extended Production Tests were conducted in 1992 and 1997 / 1998. The results demonstrated the need for a
Additional Extended Production Tests were conducted in 1992 and 1997 / 1998. The results demonstrated the need for a
workover to isolate water production and reinstate oil production and to determine the oil productivity and reserves.
workover to isolate water production and reinstate oil production and to determine the oil productivity and reserves.
workover to isolate water production and reinstate oil production and to determine the oil productivity and reserves.
West Kora-1 remains as a completed oil well which is planned to be placed back on production to the existing West Kora Tank
West Kora-1 remains as a completed oil well which is planned to be placed back on production to the existing West Kora Tank
West Kora-1 remains as a completed oil well which is planned to be placed back on production to the existing West Kora Tank
Farm production facility following a successful workover and upgrade of the Tank Farm. The aim of the joint venture is to re-
Farm production facility following a successful workover and upgrade of the Tank Farm. The aim of the joint venture is to re-
Farm production facility following a successful workover and upgrade of the Tank Farm. The aim of the joint venture is to re-
establish cash flow from oil production from West Kora-1 and to exploit any further oil potential in the surrounding area.
establish cash flow from oil production from West Kora-1 and to exploit any further oil potential in the surrounding area.
establish cash flow from oil production from West Kora-1 and to exploit any further oil potential in the surrounding area.
The L 15 participants continued to consider a West Kora -1 workover programme. With improvements in technology and
The L 15 participants continued to consider a West Kora -1 workover programme. With improvements in technology and
The L 15 participants continued to consider a West Kora -1 workover programme. With improvements in technology and
significantly higher oil prices, revived production from West Kora-1 could be feasible.
significantly higher oil prices, revived production from West Kora-1 could be feasible.
significantly higher oil prices, revived production from West Kora-1 could be feasible.
The L15 Joint Venture aims to upgrade the existing production facility and restore oil production from West Kora -1.
The L15 Joint Venture aims to upgrade the existing production facility and restore oil production from West Kora -1.
The L15 Joint Venture aims to upgrade the existing production facility and restore oil production from West Kora -1.
AUSTRALIA
AUSTRALIA
AUSTRALIA
EP 424 and 110, offshore / onshore Carnarvon Basin, Western Australia
EP 424 and 110, offshore / onshore Carnarvon Basin, Western Australia
EP 424 and 110, offshore / onshore Carnarvon Basin, Western Australia
Pancontinental 38.462%
Pancontinental 38.462%
Pancontinental 38.462%
The Carnarvon Basin has yielded numerous oil and gas discoveries over many years, commencing with the discovery of the
The Carnarvon Basin has yielded numerous oil and gas discoveries over many years, commencing with the discovery of the
The Carnarvon Basin has yielded numerous oil and gas discoveries over many years, commencing with the discovery of the
Barrow Island oil field in 1964.
Barrow Island oil field in 1964.
Barrow Island oil field in 1964.
The EP 110 and EP 424 exploration areas lie in the Flinders Fault Zone trend of the Barrow Sub- Basin near the Roller,
The EP 110 and EP 424 exploration areas lie in the Flinders Fault Zone trend of the Barrow Sub- Basin near the Roller,
The EP 110 and EP 424 exploration areas lie in the Flinders Fault Zone trend of the Barrow Sub- Basin near the Roller,
Saladin and Skate oil fields and the onshore Tubridgi gas field.
Saladin and Skate oil fields and the onshore Tubridgi gas field.
Saladin and Skate oil fields and the onshore Tubridgi gas field.
EP 110 is operated in conjunction with EP- 424. The parties in EP-110 have identical equities to those in permit EP-424.
EP 110 is operated in conjunction with EP- 424. The parties in EP-110 have identical equities to those in permit EP-424.
EP 110 is operated in conjunction with EP- 424. The parties in EP-110 have identical equities to those in permit EP-424.
During the year the Joint Venture considered a further review aimed at outlining possible onshore leads and prospects in EP
During the year the Joint Venture considered a further review aimed at outlining possible onshore leads and prospects in EP
During the year the Joint Venture considered a further review aimed at outlining possible onshore leads and prospects in EP
110.
110.
110.
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Pancontinental Oil & Gas NL Annual Report 2012
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Pancontinental Oil & Gas NL Annual Report 2012
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3
3
Review of Operations
AUSTRALIA – EP 424 & EP 110
Image 23
The Baniyas Prospect is on-trend to the Roller, Saladin and Skate oil fields. The crest of the Baniyas feature has anomalous
seismic amplitudes, consistent with the presence of gas-over-oil or gas-over-water, although it is possible that other factors
may be responsible for the anomaly.
Commercial negotiations, conducted over several months, to gain access to the entire Baniyas prospect have reached a point
where the Operator is of the view that there is little likelihood that the adjoining acreage can be secured.
Following a technical review of the Baniyas potential and because of the absence of success in extending Joint Venture access
over all of the Baniyas Prospect, it was decided to consider selling or otherwise disposing of the licences.
Pancontinental oil & Gas nl | Annual Report 2012
25
Review of Operations
Review of Operations
NEW VENTURES
Pancontinental continuously reviews new opportunities in Australia and internationally. During the year a number of new
opportunities were assessed and one was completed, being the acquisition of an additional 10% interest in Namibian EL
0037.
CAPITAL RAISING
During the year Pancontinental raised $65 million (before costs) through equity issues to fund its African exploration
campaigns. As a result of the capital raising programme, Pancontinental is well funded for its current projects, and in a good
position to seek new opportunities, when opportune.
PROMOTION
Pancontinental has given presentations to Fund Managers, Institutions and Broking firms in London, Toronto, New York, the
Far East and across Australia throughout the year. The Company’s campaign to increase its recognition and brand is ongoing
and will be expanded in the coming year.
SPONSORSHIP
As part of its community support program, Pancontinental was a Platinum Sponsor of the Kenya Diaspora Conference held
in Perth recently. The Conference was a great success and attended by the Kenyan High Commissioner, Mr Stephen
Kipkiyeny arap Tarus.
PANCONTINENTAL TEAM
During the year Pancontinental has strengthened its financial position, added to its asset portfolio and participated in the
drilling of the Mbawa well, which was a discovery. Pancontinental is fortunate to have a small and dedicated team who have
contributed immensely to the Company’s success.
The accounting and administration team, led by Company Secretary Vesna Petrovic, and comprising Linda Underwood,
Margaret Johnson and Roberta Gowans have been invaluable in their contribution to the Company.
In Namibia Pancontinental has been fortunate to gain the services of experienced oil & gas veteran, Mr Ger Kegge. Ger has
had a long and successful career, firstly with Shell, and latterly with Tullow. He now resides in Windhoek, Namibia and is
Pancontinental’s Namibia in-country manager. Ger’s industry experience and knowledge is a welcome addition to the team.
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Pancontinental Oil & Gas NL Annual Report 2012
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3
Directors’ Report
Directors’ Report
Your directors submit their report for the year ended 30 June 2012.
DIRECTORS
The names and details of the company's directors in office during the financial year and until the date of this report are as
follows. Directors were in office for this entire period unless otherwise stated.
Names, qualifications, experience and special responsibilities
Mr Henry David Kennedy MA (Geology), SEG, PESA, AIG (Non-Executive Chairman)
Mr Kennedy has had a long association with Australian and New Zealand resource companies and as a technical director has
been instrumental in the formation and/or development of a number of successful listed companies. During his term as
executive director, these companies were involved in discovery of the Tubridgi gas field, South Pepper, North Herald and
Chervil oil fields in Western Australia and the Kupe South and Rua oil/gas condensate fields in New Zealand. Mr Kennedy is
currently a non-executive director of Norwest Energy NL (since April 1997).
Mr Roy Barry Rushworth, BSc (Executive Director, Chief Executive Officer)
Mr Rushworth has more than twenty five years experience in petroleum exploration. He is a graduate of Sydney University,
with a Bachelor of Science Degree in Geology and Marine Sciences. Commencing with positions in exploration operations, his
career then extended to a period as Chief Geologist and subsequently Exploration Manager for an Australian listed company. A
number of oil and gas discoveries were made by the company during that time. More recently, as the General Manager and
Director of Afrex Limited, he was responsible for acquiring international new venture opportunities for Afrex Limited and its
then co-venturer Pancontinental Oil & Gas NL. In this position he identified and negotiated projects in Malta, Kenya and
Morocco. Following the merger of Afrex Limited with Pancontinental in August 2005, he accepted the position of Director -
New Ventures for Pancontinental and is now the Chief Executive Officer of the company.
Mr Anthony Robert Frederick Maslin BBus (Independent Non-Executive Director)
Mr Maslin is a stockbroker with corporate experience in both management and promotion, along with an extensive
understanding of financial markets. Mr Maslin has been instrumental in the capital raisings and promotion of several resource
development companies. Mr Maslin is also a director of Buxton Resources Ltd (since November 2010).
Mr Ernest Anthony Myers CPA (Executive Finance Director)
Mr Myers has over 30 years experience in the resources industry. Mr Myers is an accountant (CPA) who has held senior
management and executive roles within a number of ASX listed companies. Mr Myers joined Pancontinental in March 2004 as
Company Secretary and was appointed Finance Director in January 2009. He brings corporate and operational experience in a
variety of fields including project development, feasibility studies and both equity and debt financing. Prior to his appointment
with Pancontinental, Mr Myers was CFO and Company Secretary of Dragon Mining Limited for a period of six years during
its transition from an exploration company to a gold producer in Sweden. Mr Myers has extensive experience in exploration
and operational issues, particularly in Kenya, Tanzania, Namibia and Eritrea. Mr Myers has been an alternate director of East
Africa Resources Limited since June 2010.
COMPANY SECRETARY
Mrs Vesna Petrovic, BComm, CPA
Mrs Petrovic is a Certified Practicing Accountant with over 10 years’ experience in the resources sector and has previously
held positions with numerous publicly listed entities. In particular, Mrs Petrovic has significant experience with companies
involved in Africa. Mrs Petrovic holds a Bachelor of Commerce, Major in Accounting and Business Law and has completed
the Graduate Diploma in Applied Corporate Governance from Chartered Secretaries Australia Ltd.
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Pancontinental oil & Gas nl | Annual Report 2012
Pancontinental Oil & Gas NL Annual Report 2012
27
Review of Operations
Directors’ Report (continued)
The relevant interest of each director in the shares and options of the company as at 30 June 2012 is as follows:
Directors’ Interests
Henry David Kennedy
Roy Barry Rushworth
Anthony Robert Frederick Maslin
Ernest Anthony Myers
EARNINGS PER SHARE
Basic earnings (loss) per share
Diluted earnings (loss) per share
CORPORATE INFORMATION
Ordinary Shares
133,301,602
35,335,610
14,583
285,715
Options over
Ordinary Shares
1,500,000
3,000,000
-
-
Cents
(0.23)
(0.23)
Corporate structure
Pancontinental Oil & Gas NL is a no liability company incorporated and domiciled in Australia.
Nature of operations and principal activities
The principal activity during the year of entities within the consolidated entity was exploration for oil and gas.
There have been no significant changes in the nature of those activities during the year.
Employees
The consolidated entity had no employees as at 30 June 2012, (2011: no employees). The consolidated entity employs the
services of specialised consultants where and when needed.
OPERATING AND FINANCIAL REVIEW
Review of Operations
Kenya L8 [15%]
During the year, Pancontinental announced the completion of a farmout of part of its interest in Kenya licence L8. The farmout
to Tullow Kenya B.V. (“Tullow”), a wholly owned subsidiary of Tullow Oil plc was finalised by the signed consent of the
Minister of Energy of Kenya and by the satisfaction of other conditions precedent. Tullow’s interest of 10% was transferred
from Afrex Ltd, a wholly owned subsidiary of Pancontinental.
A 3D seismic survey was completed over the Nanaa lead in licence L8 in March 2012. The survey is in addition and
immediately adjacent to the earlier Mbawa 3D survey.
Final preparations for the drilling of the Mbawa prospect were carried out during the year, with drilling commencing post year
end.
Kenya L6 [40%]
Tenders for the Kifaru propect 3D seismic survey were sought during the year, with the seismic survey of 778 sq km
completed in July 2012. Pancontinental expects that the 3D survey will lead to the identification of one or more locations for
drilling in 2013/2014.
Kenya L10A & L10B [15%]
Mid January, in areas L10A and L10B, extensive new 3D and 2D offshore seismic surveys were completed. The Eastern
section of the licence areas was covered by 3D whereas 2D covered the Western parts of the licence area. Processing and
interpretation continued after year end.
The 2D and 3D followed up more than ten strong leads previously identified in a prospectivity review.
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3
Director’s Report (continued)
Directors’ Report (continued)
Namibia EL 0037 [95% post transfer]
Prior to year end, Pancontinental negotiated acquiring 10% of Paragon Holdings (Pty) Ltd’s (“Paragon”) 15% interest in
exchange for US $4 million.US $2 million was paid immediately and a further US $2 million will be paid on the earlier of: 1)
farmout; or 2) after six months from the date of transfer. The transaction which received Ministerial approval post year end
will see Pancontinental holding 95% of the interest in EL 0037 and Paragon 5%. Paragon’s 5% interest will be “free carried”
until the commencement of the development of any discovery.
Australia EP 104/R1 [10%]
In the Canning Basin, prospectivity of the licence areas continued to be assessed by the EP 104 / R1 joint ventures. Going
forward, Pancontinental will consider the value of the project and future potential if any.
Australia L15 [12%]
Elsewhere in the Canning Basin, rehabilitation of the West Kora oil field production facility was contemplated by the L15 joint
venture. Pancontinental believes with current higher oil prices and improvements in technology, revived production from the
oil field could be feasible in the future.
Australia EP 424 [38.462%]
In the Carnarvon Basin, commercial negotiations to gain access to the entire Baniyas prospect have reached a point where the
Operator is of the view that there is little likelihood that the adjoining acreage can be secured.
Following a technical review of the Baniyas potential and due to the absence of success in extending Joint Venture access over
all of the Baniyas Prospect, the company will consider selling or otherwise disposing of the licence.
Australia EP 110 [38.462%]
Also in the Carnarvon Basin, the EP 110 joint venture considered a further review aimed at outlining possible onshore leads
and prospects.
Group Overview
Pancontinental Oil and Gas NL was incorporated in 1985 and listed on the Australian Securities Exchange in 1986.
Performance Indicators
The board closely monitors the group’s operating plans, financial budget and overall performance.
Dynamics of the Business
The company continues to develop its International and Australian acreage utilising the skills and experience of the existing
operators. Whilst the company is committed to further developing existing projects, emerging opportunities are reviewed on a
timely basis.
Risk Management
The group takes a proactive approach to risk management. The board is responsible for ensuring that risks and opportunities
are identified on a timely basis and that the group's objectives and activities are aligned with the risks and opportunities
identified by the board.
The group believes that it is crucial for all board members to be a part of this process, and as such the board has not established
a separate risk management committee. The board has a number of mechanisms in place to ensure that its objectives and
activities are aligned with the risks identified. These include the following:
Implementation of board approved operating plans and cash flow budgets and board monitoring of progress against these
budgets.
Reports on specific business risks, including such matters as environmental issues and concerns.
The group has advised each director, manager and consultant that they must comply with a set of ethical standards
maintaining appropriate core company values and objectives. Such standards ensure shareholder value is delivered and
maintained. Standards cover legal compliance, conflict resolution, privileged information and fair dealing.
The board provides shareholders with information using a comprehensive Continuous Disclosure Policy which includes
identifying matters which have a material effect on the underlying security price. ASX announcements, the web page of
the company and other media resources are used to convey such information. The board encourages full participation by
shareholders at the AGM and shareholders are requested to vote on board and executive remuneration aggregates as well
as the Employee Incentive Scheme.
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29
Director’s Report (continued
Directors’ Report (continued)
Operating Results for the Year
Summarised operating results are as follows:
Non-segment and unallocated revenues and results
Consolidated entity revenues and results from ordinary activities before income tax expense
Revenues
$
435,903
435,903
2012
Results
$
(1,805,733)
(1,805,733)
Shareholder Returns
The group is in the exploration phase and so returns to shareholders are primarily measured through capital growth.
Basic earning per share (cents)
2012
(0.23)
2011
(0.16)
2010
(0.32)
2009
(1.26)
2008
(0.36)
2007
(0.6)
Investments for Future Performance
The group continues to evaluate opportunities utilising in-house commercial expertise as well as corporate advice.
Review of Financial Condition
Capital Structure
The group has a sound capital structure from which to continue its development programmes.
During the year, the company successfully raised over $56 million dollars (net of costs) by way of share placements, a share purchase plan
and exercise of options as detailed below:
Share Capital
Beginning of the financial year
Issued during the year:
Placement (net of costs)
Share Purchase Plan (net of costs)
Exercise of Options (net of costs)
End of the financial year
Movements in the options of the company during the year are as per below:
Option Reserve
Balance at beginning of year
expired
exercised
issued
Balance at end of year
Number of shares
$
660,779,809
38,166,253
457,142,858
3,271,427
2,250,000
1,123,444,094
56,323,935
512,168
129,750
95,132,106
Number of options
Weighted average
exercise price
13,750,000
(9,250,000)
(2,250,000)
2,250,000
4,500,000
0.08
0.10
0.59
0.13
0.09
Treasury policy
The board has not considered it necessary to establish a separate treasury function because of the size and scope of the group's
activities.
Liquidity and Funding
The group has sufficient liquidity and funding to continue operations into the foreseeable future.
All operating plans and budgets are approved by the board and progress is reviewed continuously with reference to the
approved plan and budget.
Statement of Compliance
The above report is based on the guidelines in The Group of 100 Incorporated publication Guide to the Review of Operations
and Financial Condition.
SIGNIFICANT CHANGES IN THE STATE OF AFFAIRS
No significant changes in the state of affairs of the company occurred during the financial year.
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Director’s Report (continued)
Directors’ Report (continued)
SIGNIFICANT EVENTS AFTER THE BALANCE DATE
Significant events after balance date include:
12 July 2012 – Kenya L6
In the company’s Kenya L6 offshore exploration licence, 3D seismic data was acquired post financial year end. The data
acquisition covered a number of prospects, in particular the Kifaru Prospect towards the south of the licence area. Processing
and interpretation of the data in the coming months may provide potential prospects for drilling going forward.
19 July 2012 – Namibia EL 0037
The company increased its Namibian acreage by acquiring an additional 10% of co-venturer Paragon Holdings Limited’s
(“Paragon”) interest in the EL 0037 licence. The purchase price of the acquisition was US $4 million, with US $2 million
payable immediately and the remaining US $2 million upon the earlier of; 1) Pancontinental farming out an interest in the
licence: or 2) six months after the date of the transaction.
31 July 2012 - Fundraising
The company further increased its cash reserves by announcing that the shortfall from the April 2012 Share Purchase Plan was
to be placed with sophisticated investors as well as international and domestic institutional clients of brokers Hartleys Limited.
25,300,002 shares were placed at $0.175, raising $4,427,500.
13 August 2012 – Kenya L8
Operator Apache Corporation, on behalf of the Kenya L8 joint venture commenced drilling the Mbawa prospect in August
2012. On 10 September 2012, Pancontinental announced that at a depth of 2,553m the Mbawa well encountered approximately
52 net metres of natural gas pay in porous Cretaceous sandstones. The gas discovered by drilling the Mbawa well was the first
of its kind offshore Kenya. Total depth of 3,151m was reached on 12 September 2012, however the deeper target did not
contain hydrocarbons. Further work continues to assess the potential of the gas encountered at 2,553m.
24 August 2012 - Corporate
The company provided shareholders with a Notice of Meeting for 27 September 2012 where they will be asked to vote on two
resolutions with regard to the adoption of a new constitution for the company.
Apart from the above, no matters or circumstances have arisen since the end of the financial year which significantly affected
or may significantly affect the operations of the company, the results of those operations, or the state of affairs of the co mpany
in future financial years.
LIKELY DEVELOPMENTS AND EXPECTED RESULTS
The economic entity expects to maintain the present status and level of operations and hence there are no likely developments
in the entity's operations other than the following:
Carbon Tax
The Clean Energy Act will introduce a carbon pricing mechanism into the Australian economy from 1 July 2012. The carbon
emissions from facilities in which Pancontinental has an interest may attract the initial price set by Government of $23 per
tonne CO
equivalent. In the next two years the carbon price will rise with inflation and from 1 July 2015 the carbon price will
no longer be fixed by the Australian Government, but set by the market.
₂
Preliminary estimates of the impact of the carbon tax on the group are currently being reviewed. However, the actual cost to
the company will be subject to many variables including the actual amount of carbon dioxide emissions, the application of the
legislation by the government and the outcome of audit processes.
Petroleum Resource Rent Tax Legislation
Petroleum Resource Rent Tax (PRRT) has applied to the majority of offshore petroleum projects since 1987. As of 1 July
2012, an extension to the PRRT was implemented broadening the regime to include coal seam gas, tight gas and oil shale
projects as well as expanding to the North West Shelf project.
PRRT is payable on the taxable profit in relation to a petroleum project. If a company has an entitlement to assessable
petroleum receipts from a production licence, they will have a petroleum project.
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31
Director’s Report (continued
Directors’ Report (continued)
Obligations under PRRT are required to be met by companies with interests in joint ventures in the same manner as those with
an interest in a non-joint venture operation. As such, each participant within a joint venture arrangement has individual
obligations under PRRT and are required to lodge their own starting base return and choose their own starting base valuation
method.
At present, Pancontinental’s group operations will not be impacted by the PRRT legislation. However, should the level of
operations change during the coming financial year, Pancontinental will again conduct a review of its PRRT obligations.
ENVIRONMENTAL REGULATION AND PERFORMANCE
The company's operations are not regulated by a particular environmental regulation under a law of the Commonwealth or of a
State or Territory.
SHARE OPTIONS
Unissued shares
At the date of this report there were 4,500,000 unissued ordinary shares under options. Refer to the notes for further details on
the options outstanding.
During the year, 9,250,000 options expired, 2,250,000 were exercised (as per below) and 2,250,000 new options issued.
Shares issued as a result of the exercise of Options
2,250,000 options were exercised with shares issued as a result, during the financial year.
INDEMNIFICATION AND INSURANCE OF DIRECTORS AND OFFICERS
Since the end of the previous financial year the company has paid insurance premiums in respect of directors' and officers'
liability and legal expenses insurance contracts. The directors have not included details of the nature of the liabilities covered
or the amount of the premium paid in respect of the directors and officers and legal expenses insurance contracts as such
disclosure is prohibited under the terms of the contract. The premiums were paid in respect of the following officers of the
company and its controlled entities:
Mr HD Kennedy, Mr RB Rushworth, Mr ARF Maslin, Mr EA Myers and Mrs V Petrovic.
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Director’s Report (continued)
Directors’ Report (continued)
REMUNERATION REPORT (Audited)
This report outlines the remuneration arrangements in place for directors and executives of Pancontinental Oil & Gas NL (“the
company”).
Remuneration philosophy
A description of the remuneration structures in place is as follows: The non-executive directors received a fixed fee for their
services. They do not receive performance based remuneration. The chief executive officer received a fixed fee for his
respective executive services (with no bonus or other performance-based remuneration), and a separate fixed fee for his
services as a director. Directors do not receive any termination or retirement benefits.
Remuneration committee
The full board carries out the role of the remuneration committee.
Remuneration structure
In accordance with best practice corporate governance, the structure of non-executive director and senior manager
remuneration is separate and distinct.
Non-executive director remuneration
Objective
The board seeks to set aggregate remuneration at a level which provides the company with the ability to attract and retain
directors of the highest calibre, whilst incurring a cost which is acceptable to shareholders.
Structure
The Constitution and the ASX Listing Rules specify that the aggregate remuneration of non-executive directors shall be
determined from time to time by a general meeting. An amount not exceeding the amount determined is then divided between
the directors as agreed. The latest determination was at the Annual General Meeting held on 29 November 2007 when
shareholders approved an aggregate remuneration of $400,000 per year. The amount of aggregate remuneration sought to be
approved by shareholders and the manner in which it is apportioned amongst directors is reviewed annually. The board
considers advice from external consultants as well as the fees paid to non-executive directors of comparable companies when
undertaking the annual review process. The non-executive directors of the company can participate in the Employee Option
Incentive Plan with shareholder approval. The remuneration of executive and non-executive directors for the period ending 30
June 2012 is detailed in Table 1 of this report.
Senior manager and executive director remuneration
Objective
The board seeks to set aggregate remuneration at a level which provides the company with the ability to attract and retain
executives of the highest calibre, whilst incurring a cost which is acceptable to shareholders.
Structure
In determining the level and make up of executive remuneration, the board takes independent advice from external consultants
when necessary. It is the board's policy that employment contracts are only entered into with the chief executive officer and
with key executives. Details of the CEO’s contract are as follows:
Basic Sum:
Capacity:
Commencement Date:
Termination Period:
$550,000
Chief Executive Officer
1 July 2011
6-12 months
Fixed remuneration
Objective
The level of fixed remuneration is set so as to provide a base level which is both appropriate to the position and is competitive
in the market.
Structure
Fixed primary remuneration is paid on a cash basis and there are no fringe benefits or other costs incurred by the company.
Pancontinental oil & Gas nl | Annual Report 2012
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33
Director’s Report (continued
Directors’ Report (continued)
Company performance
Company performance is reflected in the movement in the company's share price over time. As the company is in an
exploration phase, returns to shareholders will primarily come through share price appreciation. The board’s strategy in
achieving this aim is to acquire early stage projects which can attract quality joint venture partners.
The company has developed skills in the acquisition of projects and also built strategic alliances with other companies to
further develop its project portfolio.
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Director’s Report (continued)
Directors’ Report (continued)
Table 1: Director remuneration for the year ended 30 June 2012
Primary benefits
Post Employment
Equity
Total
Salary & Fees Cash STI Superannuation Options (Issued)
Value of options as
proportion of
Revenue
Henry David Kennedy
(Non-Executive Chairman)
2012
2011
Roy Barry Rushworth
(Executive Director,
Chief Executive Officer)
2012
2011
Ian Raymond (Inky) Cornelius
(Non-Executive Director)
(Passed away 14 July 2010)
2012
2011
Anthony Robert Frederick Maslin
(Non-Executive Director)
2012
2011
Ernest Anthony Myers
(Executive Finance Director)
2012
2011
50,000
50,000
550,000
415,833
-
2,000
48,000
25,806
48,000
48,000
Total Current Year Remuneration
696,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
63,726
-
113,726
50,000
14.6%
-
127,453
-
677,453
415,833
29.2%
-
-
-
-
-
-
-
-
2,000
48,000
25,806
48,000
48,000
191,179
887,179
-
-
-
-
-
-
-
Table 2: Options granted as part of remuneration for the year ended 30 June 2012
(in accordance with the Employee Incentive Scheme)
Henry David Kennedy
Roy Barry Rushworth
Anthony Robert Frederick Maslin
Ernest Anthony Myers
Total Options Issued
Issued
750,000
1,500,000
-
-
2,250,000
From 1 July 2003, options granted as part of director and management remuneration have been valued using a Black-Scholes option pricing
model, in which the option exercise price, the current level and volatility of the underlying share price, the risk-free interest rate, expected
dividends on the underlying shares, the current market price of the underlying shares and the expected life of the options are taken into
account. See following table for further details. 2,250,000 options were granted to directors during the year.
Fair values of options:
The fair value of each option is estimated on the date of grant using a Black-Scholes option pricing model.
Expected volatility
Risk-free interest rate
Expected life of option
Number of options
2,250,000
2,250,000
Grant date
29 Nov 07
29 Nov 11
2012
120%
3.57%
3 years
2011
2010
2009
-
-
-
-
-
-
-
-
-
Vesting date
28 May 08
28 May 12
2008
113%
6.42%
5 years
2007
112%
5.75%
5 years
Weighted average fair value
0.05
0.08
Pancontinental oil & Gas nl | Annual Report 2012
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35
Director’s Report (continued
Directors’ Report (continued)
END OF REMUNERATION REPORT
DIRECTORS' MEETINGS
The numbers of meetings of directors (including meetings of committees of directors) held during the year and the number of
meetings attended by each director were as follows:
Number of meetings held:
Number of meetings attended:
Henry David Kennedy
Roy Barry Rushworth
Anthony Robert Frederick Maslin
Ernest Anthony Myers
Directors'
Meetings
2
2
2
1
2
Notes
The directors are of the opinion that it is often more efficient to deal with matters by circular resolutions than by board
meetings, and 21 matters were dealt with in such a manner during the year.
ROUNDING
The amounts contained in this report and in the financial report have been rounded to the nearest $1 (where rounding is
applicable) under the option available to the company under ASIC Class Order 98/0100. The company is an entity to which
the Class Order applies.
AUDITOR’S INDEPENDENCE DECLARATION
The auditor independence declaration is set out on the following page and reviews part of the Directors’ Report for the year
ended 30 June 2012.
NON-AUDIT SERVICES
Rothsay received $3,300 (including GST) for the provision of non-audit services during the year and a further $1,000 was
accrued for taxation services.
Signed in accordance with a resolution of the Directors.
Ernest Anthony Myers
Director
Perth 27 September 2012
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Auditor’s Independence Declaration
Auditor’s Independence Declaration
AUDITOR INDEPENDENCE
The directors received the following declaration from the auditor of Pancontinental Oil & Gas NL:
Auditor's Independence Declaration to the Directors of Pancontinental Oil & Gas NL
In accordance with Section 307C of the Corporations Act 2001 (the “Act”) I hereby declare that to the best of my
knowledge and belief there have been:
i)
ii)
no contraventions of the auditor independence requirements of the Act in relation to the audit of the 30 June
2012 annual financial statements; and
no contraventions of any applicable code of professional conduct in relation to the audit.
Mr Graham Swan
Lead Auditor
27 September 2012
Pancontinental oil & Gas nl | Annual Report 2012
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Director’s Report (continued
Director’s Report (continued
Corporate Governance Statement
In accordance with the ASX Corporate Governance Council's Corporate Governance Principles and Recommendations
("ASX Principles and Recommendations")1, Pancontinental Oil & Gas NL ("the company") has made it a priority to adopt
In accordance with the ASX Corporate Governance Council's Corporate Governance Principles and Recommendations
("ASX Principles and Recommendations")1, Pancontinental Oil & Gas NL ("the company") has made it a priority to adopt
systems of control and accountability as the basis for the administration of corporate governance. Some of these policies and
systems of control and accountability as the basis for the administration of corporate governance. Some of these policies and
procedures are summarised in this statement. Commensurate with the spirit of the ASX Principles and Recommendations, the
procedures are summarised in this statement. Commensurate with the spirit of the ASX Principles and Recommendations, the
company has followed each recommendation where the board has considered the recommendation to be an appropriate
company has followed each recommendation where the board has considered the recommendation to be an appropriate
benchmark for corporate governance practices, taking into account factors such as the size of the company and the board,
benchmark for corporate governance practices, taking into account factors such as the size of the company and the board,
resources available and activities of the company. Where, after due consideration, the company's corporate governance
resources available and activities of the company. Where, after due consideration, the company's corporate governance
practices depart from the ASX Principles and Recommendations, the board has offered full disclosure of the nature of and
practices depart from the ASX Principles and Recommendations, the board has offered full disclosure of the nature of and
reason for the adoption of its own practice.
reason for the adoption of its own practice.
Further information about the company's corporate governance practices is set out on the company's website at
Further information about the company's corporate governance practices is set out on the company's website at
www.pancon.com.au. In accordance with the ASX Principles and Recommendations, information published on the
www.pancon.com.au. In accordance with the ASX Principles and Recommendations, information published on the
company's website includes charters (for the board and its committees), the company's code of conduct and other policies and
company's website includes charters (for the board and its committees), the company's code of conduct and other policies and
procedures relating to the board and its responsibilities.
procedures relating to the board and its responsibilities.
EXPLANATIONS FOR DEPARTURES FROM BEST PRACTICE RECOMMENDATIONS
EXPLANATIONS FOR DEPARTURES FROM BEST PRACTICE RECOMMENDATIONS
During the company's 2011/2012 financial year ("reporting period") the company has followed each of the ASX Principles
During the company's 2011/2012 financial year ("reporting period") the company has followed each of the ASX Principles
and Recommendations, other than in relation to the matters specified below.
and Recommendations, other than in relation to the matters specified below.
Principle 2
Principle 2
Recommendation 2.1: A majority of the board should be independent directors
Recommendation 2.1: A majority of the board should be independent directors
Notification of Departure:
Notification of Departure:
Currently only one of the four directors is considered to be independent – Mr Maslin.
Currently only one of the four directors is considered to be independent – Mr Maslin.
Messrs Rushworth and Myers are executives and Mr Kennedy, a substantial shareholder.
Messrs Rushworth and Myers are executives and Mr Kennedy, a substantial shareholder.
Explanation for Departure:
Explanation for Departure:
Given the size and scope of the company's operations the board considers that it is appropriately structured to discharge its
Given the size and scope of the company's operations the board considers that it is appropriately structured to discharge its
duties in a manner that is in the best interests of the company. The board believes its current composition is in line with the
duties in a manner that is in the best interests of the company. The board believes its current composition is in line with the
long term interests of shareholders. Furthermore, mechanisms are in place so that if a director considers it necessary, they
long term interests of shareholders. Furthermore, mechanisms are in place so that if a director considers it necessary, they
may obtain independent professional advice. The board considers independence, amongst other things, when recommending
may obtain independent professional advice. The board considers independence, amongst other things, when recommending
new directors to the board.
new directors to the board.
Principle 2
Principle 2
Recommendation 2.2: The chair should be an independent director
Recommendation 2.2: The chair should be an independent director
Notification of Departure
Notification of Departure
The chair is not considered to be independent.
The chair is not considered to be independent.
Explanation for Departure
Explanation for Departure
Mr Kennedy is not independent by virtue of his substantial shareholding in the company. However, the board considers that
Mr Kennedy is not independent by virtue of his substantial shareholding in the company. However, the board considers that
Mr Kennedy's interests are aligned with the long term interests of shareholders. Given Mr Kennedy's extensive experience
Mr Kennedy's interests are aligned with the long term interests of shareholders. Given Mr Kennedy's extensive experience
and qualifications, the board believes Mr Kennedy is the most appropriate director to carry out the role of chair.
and qualifications, the board believes Mr Kennedy is the most appropriate director to carry out the role of chair.
1
1
A copy of the ASX Principles and Recommendations is set out on the company’s website under the Section entitled "Corporate Governance".
A copy of the ASX Principles and Recommendations is set out on the company’s website under the Section entitled "Corporate Governance".
Pancontinental Oil & Gas NL Annual Report 2012
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3
Corporate Governance Statement
Corporate Governance Statement
Principle 2
Recommendation 2.4: The board should establish a nomination committee
Notification of Departure:
The full board fulfils the role of a nomination committee.
Explanation for Departure:
The full board considers those matters that would usually be the responsibility of a nomination committee. The board
considers that no efficiencies or other benefits would be gained by establishing a separate nomination committee. The board
has adopted a nomination committee charter, which it applies when convening as the nomination committee.
Principle 4
Recommendation 4.1: The board should establish an audit committee
Recommendation 4.2: Structure of the audit committee
Notification of Departure:
The full board fulfils the role of an audit committee.
Explanation for Departure:
The composition of the board is not suitable for the formation of a separate audit committee in accordance with the
recommendation. Further, the independent director does not possess the requisite financial expertise recommended in an
audit committee. The board has adopted an audit committee charter to assist with its function as an audit committee. The
audit committee charter provides that independent directors may meet with the external auditor.
Principle 7
Recommendation 7.2: Implement, manage and report on risk management system
Notification of Departure:
The board has not received a formal documented report from management on the effectiveness of their management of the
company’s material business risks other than verbal updates at board meetings.
Explanation for Departure:
Although a formal risk management system has not been implemented, the board has encouraged an increased focus on risk
management during the year. Frequent discussions and reviews of the various risks that the Pancontinental group may be
exposed to are regularly carried out. The company is committed to further developing and strengthening the company’s risk
management policies.
Principle 8
Recommendation 8.1: The board should establish a remuneration committee
Recommendation 8.2: Structure of the remuneration committee
Notification of Departure:
The board fulfils the function of a remuneration committee.
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39
Director’s Report (continued
Corporate Governance Statement
Explanation for Departure:
Given the size and composition of the board, it is not practicable that a separate committee be formed. To assist it to carry out
its function in relation to remuneration matters, the board has adopted a remuneration committee charter.
COMMITTEE MEETINGS
Due to the size of the current board, the functions of the Nomination, Audit and Remuneration Committees were carried out
by the full board during the financial year. As such, no separate meetings were held for the Nomination and Remuneration
Committees. The board agenda may incorporated these items and appropriate discussions held at the board meetings.
Details of each of the director's qualifications are set out in the Directors’ Report. All of the directors have substantial
industry experience and consider themselves to be financially literate. Mr Myers is a Certified Practising Accountant and
therefore meets the tests of financial expertise.
OTHER
Skills, Experience, Expertise and term of office of each Director
A profile of each director containing the skills, experience, expertise and term of office of each director is set out in the
Directors' Report.
Identification of Independent Directors
In considering the independence of directors, the board refers to the criteria for independence as set out in Box 2.1 of the
ASX Principles and Recommendations ("Independence Criteria"). To the extent that it is necessary for the board to consider
issues of materiality, the board refers to the thresholds for qualitative and quantitative materiality as adopted by the board and
contained in the board charter, which is disclosed in full on the company’s website.
Applying the Independence Criteria, the independent director of the company for the current financial year was Mr Maslin.
Corporate Reporting
ASX Principle 7.3 requires the board to disclose whether it has received assurance from the Chief Executive Officer (or
equivalent) and the Chief Financial Officer (or equivalent) that the declaration provided in accordance with section 295A of
the Corporations Act is founded on a sound system of risk management and internal control and that the system is operating
effectively in all material respects in relation to financial reporting risks. The board confirms that such assurance has been
received.
Statement concerning availability of Independent Professional Advice
If a director considers it necessary to obtain independent professional advice to properly discharge the responsibility of
his/her office as a director, then, provided the director first obtains approval for incurring such expense from the chair, the
company will pay the reasonable expenses associated with obtaining such advice.
Confirmation of whether performance Evaluation of the Board and its members has taken place and how it was
conducted
During the reporting period a formal evaluation of the board and its members was not carried out as it was not considered to
be a beneficial procedure given the size and composition of the board and the nature of the company's operations. However,
the composition of the board and its suitability to carry out the company's objectives is discussed on an as-required basis
during regular meetings of the board and any adjustments are made accordingly.
Existence and Terms of any Schemes for Retirement Benefits for Executive and Non-Executive Directors
There are no termination or retirement benefits for non-executive directors.
40
Pancontinental Oil & Gas NL Annual Report 2012
Annual Report 2012 | Pancontinental oil & Gas nl
3
Corporate Governance Statement
Term in office
13 years
7 years
3 years
Term in office
1 year
13 years
Term in office
7 years
13 years
3 years
7 years
1 year
3 years
1 year
Directors’ Terms in Office
Corporate Governance Statement
Name
Corporate Governance Statement
Henry David Kennedy
Corporate Governance Statement
Roy Barry Rushworth
Directors’ Terms in Office
Ernest Anthony Myers
Name
Directors’ Terms in Office
Anthony Robert Frederick Maslin
Henry David Kennedy
Name
Roy Barry Rushworth
Henry David Kennedy
For additional details regarding board appointments, please refer to the Pancontinental website.
Ernest Anthony Myers
Roy Barry Rushworth
Anthony Robert Frederick Maslin
Ernest Anthony Myers
Diversity – Board Composition
Anthony Robert Frederick Maslin
For additional details regarding board appointments, please refer to the Pancontinental website.
The mix of skills and diversity for which the company is looking to achieve in membership of the board is one that is as
For additional details regarding board appointments, please refer to the Pancontinental website.
diverse as practicable given the size and scope of the company’s operations. The company has adopted a Diversity Policy
Diversity – Board Composition
which is available on the company’s website under the Corporate Governance section.
Diversity – Board Composition
The mix of skills and diversity for which the company is looking to achieve in membership of the board is one that is as
Diversity – Measurable Objectives
diverse as practicable given the size and scope of the company’s operations. The company has adopted a Diversity Policy
The mix of skills and diversity for which the company is looking to achieve in membership of the board is one that is as
which is available on the company’s website under the Corporate Governance section.
diverse as practicable given the size and scope of the company’s operations. The company has adopted a Diversity Policy
The company’s primary objectives with regard to diversity are as follows:
which is available on the company’s website under the Corporate Governance section.
Diversity – Measurable Objectives
Diversity – Measurable Objectives
The company’s primary objectives with regard to diversity are as follows:
The company’s primary objectives with regard to diversity are as follows:
The company’s primary objectives with regard to diversity are as follows:
➣
Primary objectives set by the company with regard to diversity have been met, as described below:
➣
to
provide equal opportunities for all positions within the company and continue the company’s commitment to
th
employment based on merit.
e company’s composition of board, executive, management and employees to be as diverse as practicable; and
th
the company’s composition of board, executive, management and employees to be as diverse as practicable; and
to
e company’s composition of board, executive, management and employees to be as diverse as practicable; and
to provide equal opportunities for all positions within the company and continue the company’s commitment to
provide equal opportunities for all positions within the company and continue the company’s commitment to
to
employment based on merit.
provide equal opportunities for all positions within the company and continue the company’s commitment to
employment based on merit.
bl
employment based on merit.
end of skills – wide range of backgrounds; geology, petroleum exploration, finance and corporate experience;
e company’s composition of board, executive, management and employees to be as diverse as practicable; and
th
ltural backgrounds – Australian, European and American;
end of skills – wide range of backgrounds; geology, petroleum exploration, finance and corporate experience;
blend of skills – wide range of backgrounds; geology, petroleum exploration, finance and corporate experience;
nder – both male and female members; and
end of skills – wide range of backgrounds; geology, petroleum exploration, finance and corporate experience;
cultural backgrounds – Australian, European and American;
ltural backgrounds – Australian, European and American;
e – the age range spans over 40 years.
ltural backgrounds – Australian, European and American;
gender – both male and female members; and
nder – both male and female members; and
age – the age range spans over 40 years.
nder – both male and female members; and
e – the age range spans over 40 years.
e – the age range spans over 40 years.
Primary objectives set by the company with regard to diversity have been met, as described below:
Primary objectives set by the company with regard to diversity have been met, as described below:
Primary objectives set by the company with regard to diversity have been met, as described below:
➣
➣
➣
The above points relate to the composition of the board, as the company does not have any employees.
➣
Diversity – Annual Reporting
The above points relate to the composition of the board, as the company does not have any employees.
The above points relate to the composition of the board, as the company does not have any employees.
The company’s annual reporting on the percentage of females in the organisation is as follows:
The above points relate to the composition of the board, as the company does not have any employees.
Diversity – Annual Reporting
Diversity – Annual Reporting
2011
The company’s annual reporting on the percentage of females in the organisation is as follows:
The company’s annual reporting on the percentage of females in the organisation is as follows:
20%
Executives & Board Members
N/A [no employees]
N/A [no employees]
Employees
% Female
2012
20%
cu
bl
ge
bl
cu
ag
cu
ge
ge
ag
ag
Employees
Employees
Executives & Board Members
Executives & Board Members
% Female
% Female
2012
2012
N/A [no employees]
N/A [no employees]
20%
20%
2011
2011
N/A [no employees]
N/A [no employees]
20%
20%
4
Pancontinental Oil & Gas NL Annual Report 2012
4
Pancontinental oil & Gas nl | Annual Report 2012
4
Pancontinental Oil & Gas NL Annual Report 2012
Pancontinental Oil & Gas NL Annual Report 2012
41
Statement of Comprehensive Income
Statement of Comprehensive Income
YEAR ENDED 30 JUNE 2012
Notes
Revenue from operating activities
Interest received
Other
Total revenues from operating activities
Depreciation and amortisation expenses
Salaries, fees and benefits
Audit fees
Generative exploration expenditure and write off
Annual report costs
ASX fees
Administration, accounting and secretarial fees
Insurance
Legal fees
Share registry costs
Rent and outgoings
Travel
Other revenues and expenses
Provision for loss on investments
Profit/(Loss) before Income Tax Expense
Income Tax Expense
Profit/(Loss) for the Period
Other Comprehensive Income/(Loss)
Other comprehensive income
Other Comprehensive Income/(Loss) for the Period, Net
of Income Tax
TOTAL COMPREHENSIVE INCOME/(LOSS) FOR THE
PERIOD
Basic earnings per share (cents per share)
Diluted earnings per share (cents per share)
2, 6
2
3
10
15
CONSOLIDATED
2011
$
2012
$
430,403
5,500
435,903
(1,651)
(461,773)
(40,500)
(42,035)
(6,828)
(40,944)
(291,764)
(21,561)
(11,699)
(42,878)
(96,937)
(132,841)
(1,050,265)
-
(1,805,773)
-
(1,805,773)
89,526
-
89,526
(1,183)
(322,999)
(45,500)
(58,387)
(17,291)
(35,435)
(240,404)
(22,167)
(55,425)
(20,351)
(92,380)
(100,998)
(44,037)
-
(967,031)
-
(967,031)
-
-
-
-
(1,805,773)
(967,031)
(0.23)
(0.23)
(0.16)
(0.16)
The Statement of Comprehensive Income is to be read in conjunction with the Notes to the Financial Statements.
Pancontinental Oil & Gas NL Annual Report 2012
42
Annual Report 2012 | Pancontinental oil & Gas nl
3
Statement of Financial Position
Statement of Financial Position
AT 30 JUNE 2012
Notes
CURRENT ASSETS
Cash assets
Trade and other receivables
TOTAL CURRENT ASSETS
NON-CURRENT ASSETS
Property, plant and equipment
Deferred exploration, evaluation and development costs
TOTAL NON-CURRENT ASSETS
TOTAL ASSETS
CURRENT LIABILITIES
Trade and other payables
TOTAL CURRENT LIABILITIES
TOTAL LIABILITIES
NET ASSETS
EQUITY
Parent entity interest
Contributed equity
Reserves
Accumulated losses
Total parent entity interest in equity
TOTAL EQUITY
4
6
7
8
9a
10
10
CONSOLIDATED
2012
$
2011
$
47,722,233
98,582
47,820,815
5,710,905
44,028
5,754,933
3,598
23,211,960
23,215,558
2,404
9,879,712
9,882,116
71,036,373
15,637,049
235,805
235,805
187,740
187,740
235,805
187,740
70,800,568
15,449,309
95,132,106
298,956
(24,630,494)
70,800,568
70,800,568
38,166,253
764,258
(23,481,202)
15,449,309
15,449,309
The Statement of Financial Position is to be read in conjunction with the Notes to the Financial Statements.
Pancontinental oil & Gas nl | Annual Report 2012
4
Pancontinental Oil & Gas NL Annual Report 2012
43
Notes to the Financial Statements
Notes to the Financial Statements
Notes to the Financial Statements
Notes to the Financial Statements
Statement of Changes in Equity
AT 30 JUNE 2012
AT 30 JUNE 2012
AT 30 JUNE 2012
AT 30 JUNE 2012
Consolidated
Consolidated
Consolidated
Consolidated
Balance at 1 July 2011
Balance at 1 July 2011
Balance at 1 July 2011
Balance at 1 July 2011
Profit or loss
Profit or loss
Profit or loss
Profit or loss
Other comprehensive income/(loss)
Other comprehensive income/(loss)
Other comprehensive income/(loss)
Other comprehensive income/(loss)
Shares issued (net of costs)
Shares issued (net of costs)
Shares issued (net of costs)
Shares issued (net of costs)
Share options
Share options
Share options
Share options
Balance at 30 June 2012
Balance at 30 June 2012
Balance at 30 June 2012
Balance at 30 June 2012
Balance at 1 July 2010
Balance at 1 July 2010
Balance at 1 July 2010
Balance at 1 July 2010
Profit or loss
Profit or loss
Profit or loss
Profit or loss
Other comprehensive income/(loss)
Other comprehensive income/(loss)
Other comprehensive income/(loss)
Other comprehensive income/(loss)
Shares issued (net of costs)
Shares issued (net of costs)
Shares issued (net of costs)
Shares issued (net of costs)
Share options
Share options
Share options
Share options
Balance at 30 June 2011
Balance at 30 June 2011
Balance at 30 June 2011
Balance at 30 June 2011
Share Capital
Share
Share Capital
Share Capital
Share Capital
Capital
$
$
$
$
$
38,166,253
38,166,253
38,166,253
38,166,253
-
-
-
-
-
-
-
-
56,965,853
56,965,853
56,965,853
56,965,853
95,132,106
95,132,106
95,132,106
95,132,106
33,433,998
33,433,998
33,433,998
33,433,998
-
-
-
-
-
-
-
-
4,732,255
4,732,255
4,732,255
4,732,255
38,166,253
38,166,253
38,166,253
38,166,253
Retained
Retained
Retained
Retained
Earnings
Earnings
Earnings
Earnings
$
$
$
$
(23,481,202)
(23,481,202)
(23,481,202)
(23,481,202)
(1,805,773)
(1,805,773)
(1,805,773)
(1,805,773)
-
-
-
-
-
-
-
-
656,481
656,481
656,481
656,481
(24,630,494)
(24,630,494)
(24,630,494)
(24,630,494)
(22,937,128)
(22,937,128)
(22,937,128)
(22,937,128)
(967,031)
(967,031)
(967,031)
(967,031)
-
-
-
-
-
-
-
-
422,957
422,957
422,957
422,957
(23,481,202)
(23,481,202)
(23,481,202)
(23,481,202)
Option
Option
Option
Option
Reserve
Reserve
Reserve
Reserve
$
$
$
$
764,258
764,258
764,258
764,258
-
-
-
-
-
-
-
-
-
-
-
-
(465,302)
(465,302)
(465,302)
(465,302)
298,956
298,956
298,956
298,956
Total
Total
Total
Total
Equity
Equity
Equity
Equity
$
$
$
$
15,449,309
15,449,309
15,449,309
15,449,309
(1,805,773)
(1,805,773)
(1,805,773)
(1,805,773)
-
-
-
-
56,965,853
56,965,853
56,965,853
56,965,853
191,179
191,179
191,179
191,179
70,800,568
70,800,568
70,800,568
70,800,568
1,187,215
1,187,215
1,187,215
1,187,215
-
-
-
-
-
-
-
-
-
-
-
-
(422,957)
(422,957)
(422,957)
(422,957)
764,258
764,258
764,258
764,258
11,684,085
11,684,085
11,684,085
11,684,085
(967,031)
(967,031)
(967,031)
(967,031)
-
-
-
-
4,732,255
4,732,255
4,732,255
4,732,255
-
-
-
-
15,449,309
15,449,309
15,449,309
15,449,309
The above Statement of Changes in Equity is to be read in conjunction with the Notes to the Financial Statements.
The above Statement of Changes in Equity is to be read in conjunction with the Notes to the Financial Statements.
The above Statement of Changes in Equity is to be read in conjunction with the Notes to the Financial Statements.
The above Statement of Changes in Equity is to be read in conjunction with the Notes to the Financial Statements.
Pancontinental Oil & Gas NL Annual Report 2012
Pancontinental Oil & Gas NL Annual Report 2012
Pancontinental Oil & Gas NL Annual Report 2012
Pancontinental Oil & Gas NL Annual Report 2012
44
Annual Report 2012 | Pancontinental oil & Gas nl
3
3
3
3
Statement of Cash Flows
Statement of Cash Flows
YEAR ENDED 30 JUNE 2012
CASH FLOWS FROM OPERATING ACTIVITIES
Payments to suppliers and employees
Interest received
Sundry income
Expenditure on exploration interests
NET CASH FLOWS FROM/(USED IN)
OPERATING ACTIVITIES
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property, plant and equipment
NET CASH FLOWS FROM/(USED IN)
INVESTING ACTIVITIES
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issues of ordinary shares
Share issue costs
NET CASH FLOWS FROM/(USED IN)
FINANCING ACTIVITIES
NET INCREASE/(DECREASE) IN CASH HELD
Add opening cash brought forward
Effects of exchange rate changes
CLOSING CASH CARRIED FORWARD
Notes
11(a)
6
11(b)
CONSOLIDATED
2011
$
2012
$
(1,686,512)
430,256
5,500
(13,713,309)
(1,044,789)
89,526
1,083,151
(789,097)
(14,964,065)
(661,209)
(3,803)
(3,803)
-
-
60,705,250
(3,725,804)
5,000,000
(267,745)
56,979,446
4,732,255
42,011,578
5,710,905
(250)
47,722,233
4,071,046
1,639,859
-
5,710,905
The above Statement of Cash Flows is to be read in conjunction with the Notes to the Financial Statements.
Pancontinental oil & Gas nl | Annual Report 2012
45
4
Pancontinental Oil & Gas NL Annual Report 2012
Notes to the Financial Statements
Notes to the Financial Statements
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
This financial report was authorised for issue by the directors on 27 September 2012.
Statement of Compliance
This financial report is a general purpose financial report, which has been prepared in accordance with Australian
Accounting Standards (AASBs), adopted by the Australian Accounting Standards Board (AASB) and the Corporations Act
2001. International Financial Reporting Standards (IFRSs) form the basis of AASBs adopted by the AASB, and for the
purpose of this report are called Australian equivalents to IRFS (AIFRS) to distinguish from previous Australian GAAP.
The financial report complies with IFRSs and interpretations adopted by the International Accounting Standards Board.
Basis of preparation
The report has been prepared on the basis of historical costs and except where stated does not take into account changing
money values or current valuation of non-current assets. The accounting policies adopted are consistent with those of the
previous year. The following specific accounting policies have been consistently applied, unless otherwise stated.
(a) Income Tax
Income tax on the profit or loss for the year comprises current and deferred tax. Income tax is recognised in the income
statement except to the extent that it relates to items recognised directly in equity, in which case it is recognised in equity.
Current tax is the expected tax payable on the taxable income for the year, and any adjustment to tax payable in respect of
prior years.
Deferred tax is provided using the balance sheet liability method, providing for temporary difference between the carrying
amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. A deferred tax
asset is recognised only to the extent that it is probable that future taxable profits will be available against which the asset
can be utilised.
(b) Exploration Expenses
Exploration, evaluation and development costs are accumulated in respect of each separate area of interest. Such costs are
carried forward where they are expected to be recouped through successful development and exploitation of the area of
interest or alternatively, by its sale, or where activities in the area of interest have not yet reached a stage to allow a
reasonable assessment regarding the existence of economically recoverable reserves.
(c) Principles of consolidation
The consolidated financial statements are those of the consolidated entity, comprising Pancontinental Oil & Gas NL (the
parent entity) and all entities which Pancontinental Oil & Gas NL controlled from time to time during the year and at
balance date.
Information from the financial statements of subsidiaries is included from the date the parent company obtains control until
such time as control ceases. Where there is loss of control of a subsidiary, the consolidated financial statements include the
results for the part of the reporting period during which the parent company has control.
All intercompany balances and transactions, including unrealised profits arising from intra-group transactions, have been
eliminated in full.
(d) Foreign currencies
Translation of foreign currency transactions
Transactions in foreign currencies of entities within the consolidated entity are converted to local currency at the rate of
exchange ruling at the date of the transaction.
Foreign currency monetary items that are outstanding at the reporting date (other than monetary items arising under foreign
currency contracts where the exchange rate for that monetary item is fixed in the contract) are translated using the spot rate
at the end of the financial year.
A monetary item arising under a foreign currency contract outstanding at the reporting date where the exchange rate for the
46
Pancontinental Oil & Gas NL Annual Report 2012
Annual Report 2012 | Pancontinental oil & Gas nl
3
Notes to the Financial Statements
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
This financial report was authorised for issue by the directors on 27 September 2012.
Statement of Compliance
This financial report is a general purpose financial report, which has been prepared in accordance with Australian
Accounting Standards (AASBs), adopted by the Australian Accounting Standards Board (AASB) and the Corporations Act
2001. International Financial Reporting Standards (IFRSs) form the basis of AASBs adopted by the AASB, and for the
purpose of this report are called Australian equivalents to IRFS (AIFRS) to distinguish from previous Australian GAAP.
The financial report complies with IFRSs and interpretations adopted by the International Accounting Standards Board.
Basis of preparation
The report has been prepared on the basis of historical costs and except where stated does not take into account changing
money values or current valuation of non-current assets. The accounting policies adopted are consistent with those of the
previous year. The following specific accounting policies have been consistently applied, unless otherwise stated.
Income tax on the profit or loss for the year comprises current and deferred tax. Income tax is recognised in the income
statement except to the extent that it relates to items recognised directly in equity, in which case it is recognised in equity.
Current tax is the expected tax payable on the taxable income for the year, and any adjustment to tax payable in respect of
(a) Income Tax
prior years.
Deferred tax is provided using the balance sheet liability method, providing for temporary difference between the carrying
amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. A deferred tax
asset is recognised only to the extent that it is probable that future taxable profits will be available against which the asset
can be utilised.
(b) Exploration Expenses
Exploration, evaluation and development costs are accumulated in respect of each separate area of interest. Such costs are
carried forward where they are expected to be recouped through successful development and exploitation of the area of
interest or alternatively, by its sale, or where activities in the area of interest have not yet reached a stage to allow a
reasonable assessment regarding the existence of economically recoverable reserves.
The consolidated financial statements are those of the consolidated entity, comprising Pancontinental Oil & Gas NL (the
parent entity) and all entities which Pancontinental Oil & Gas NL controlled from time to time during the year and at
(c) Principles of consolidation
balance date.
Information from the financial statements of subsidiaries is included from the date the parent company obtains control until
such time as control ceases. Where there is loss of control of a subsidiary, the consolidated financial statements include the
results for the part of the reporting period during which the parent company has control.
All intercompany balances and transactions, including unrealised profits arising from intra-group transactions, have been
eliminated in full.
(d) Foreign currencies
Translation of foreign currency transactions
Transactions in foreign currencies of entities within the consolidated entity are converted to local currency at the rate of
exchange ruling at the date of the transaction.
Foreign currency monetary items that are outstanding at the reporting date (other than monetary items arising under foreign
currency contracts where the exchange rate for that monetary item is fixed in the contract) are translated using the spot rate
at the end of the financial year.
Notes to the Financial Statements
Notes to the Financial Statements
A monetary item arising under a foreign currency contract outstanding at the reporting date where the exchange rate for the
monetary item is fixed in the contract is translated at the exchange rate fixed in the contract.
All resulting exchange differences arising on settlement or re-statement are recognised as revenues and expenses for the
financial year. Any gains or costs on entering a hedge are deferred and amortised over the life of the contract.
Pancontinental Oil & Gas NL Annual Report 2012
3
(e) Cash and cash equivalents
For the purposes of the Statement of Cash Flows, cash includes cash on hand and in banks, and money market investments
readily convertible to cash within two working days, net of outstanding bank overdrafts.
Interest expense is charged as an expense as it accrues.
(f) Receivables
Trade receivables are recognised and carried at original invoice amount less a provision for any uncollectible debts. An
estimate for doubtful debts is made when collection of the full amount is no longer probable. Bad debts are written-off as
incurred.
Receivables from related parties are recognised and carried at the nominal amount due. Bills of exchange and promissory
notes are measured at the lower of cost and net realisable value.
(g) Investments
Investments in controlled entities are carried in the company’s financial statements at the lower of cost and recoverable
amount.
(h) Recoverable Amount
The carrying amounts of non-current assets valued on the cost basis, other than exploration and evaluation expenditure
carried forward are reviewed to determine whether they are in excess of their recoverable amount at reporting date. If the
carrying amount of a non-current asset exceeds its recoverable amount, the asset is written down to the lower amount. The
write down is expensed in the reporting period in which it occurs.
(i) Property, plant and equipment
Cost and valuation
Property, plant and equipment is measured at cost.
Depreciation
Depreciation is provided on a straight line basis on all property, plant and equipment.
Major depreciation rates are:
Plant and equipment:
2012
30%
2011
30%
(j) Joint ventures
Interests in the joint venture operations are brought to account by including in the respective classifications, the share of
individual assets employed and share of liabilities and expenses incurred.
In the company’s financial statements, investments in joint venture operations were carried at the lower of cost and
recoverable amount.
(k) Going concern
(k) Going concern
The directors consider that the going concern basis for the consolidated entity is appropriate and recognise that additional
The directors consider that the going concern basis for the consolidated entity is appropriate and recognise that additional
funding is required to ensure the consolidated entity can continue its operations for the twelve month period from the date
funding is required to ensure the consolidated entity can continue its operations for the twelve month period from the date
of this financial report and to fund the continued development of the consolidated entity’s exploration assets. This basis has
of this financial report and to fund the continued development of the consolidated entity’s exploration assets. This basis has
been determined after consideration of the following factors:
been determined after consideration of the following factors:
•
•
•
T
he ability to issue additional share capital under the Corporations Act 2001, if required, by a share purchase plan,
The ability to issue additional share capital under the Corporations Act 2001, if required, by a share purchase
share placement or rights issue;
plan, share placement or rights issue;
The option of farming out all or part of the consolidated entity’s exploration projects; and
he option of farming out all or part of the consolidated entity’s exploration projects; and
The ability, if required to dispose of interests in exploration and development assets.
T
T
Accordingly, the directors believe that the consolidated entity will obtain sufficient cash inflows to enable it to continue as a
going concern and that it is appropriate to adopt that basis of accounting in the preparation of the financial statements.
he ability, if required to dispose of interests in exploration and development assets.
Accordingly, the directors believe that the consolidated entity will obtain sufficient cash inflows to enable it to continue as
47
Pancontinental oil & Gas nl | Annual Report 2012
4
Pancontinental Oil & Gas NL Annual Report 2012
Notes to the Financial Statements
a going concern and that it is appropriate to adopt that basis of accounting in the preparation of the financial statements.
Notes to the Financial Statements
(l) Payables
Notes to the Financial Statements
a going concern and that it is appropriate to adopt that basis of accounting in the preparation of the financial statements.
Liabilities for trade creditors and other amounts are carried at cost which is the fair value of the consideration to be paid in
the future for goods and services received, whether or not billed to the consolidated entity.
(l) Payables
Liabilities for trade creditors and other amounts are carried at cost which is the fair value of the consideration to be paid in
Payables to related parties are carried at the principal amount.
the future for goods and services received, whether or not billed to the consolidated entity.
Deferred cash settlements are recognised at the present value of the outstanding consideration payable on the acquisition of
Payables to related parties are carried at the principal amount.
an asset discounted at prevailing commercial borrowing rates.
Deferred cash settlements are recognised at the present value of the outstanding consideration payable on the acquisition of
(m) Provisions
an asset discounted at prevailing commercial borrowing rates.
Provisions are recognised when the economic entity has a legal, equitable or constructive obligation to make a future
sacrifice of economic benefits to other entities as a result of past transactions or other past events, it is probable that a future
(m) Provisions
sacrifice of economic benefits will be required and a reliable estimate can be made of the amount of the obligation.
Provisions are recognised when the economic entity has a legal, equitable or constructive obligation to make a future
sacrifice of economic benefits to other entities as a result of past transactions or other past events, it is probable that a future
(n) Contributed equity
sacrifice of economic benefits will be required and a reliable estimate can be made of the amount of the obligation.
Issued and paid up capital is recognised at the fair value of the consideration received by the company.
(n) Contributed equity
Any transaction costs arising on the issue of ordinary shares are recognised directly in equity as a reduction of the share
Issued and paid up capital is recognised at the fair value of the consideration received by the company.
proceeds received.
Any transaction costs arising on the issue of ordinary shares are recognised directly in equity as a reduction of the share
(o) Revenue recognition
proceeds received.
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the entity and the revenue can
be reliably measured. The following specific recognition criteria must also be met before revenue is recognised:
(o) Revenue recognition
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the entity and the revenue can
Rendering of Services
be reliably measured. The following specific recognition criteria must also be met before revenue is recognised:
Where the contract outcome can be reliably measured, control of the right to be compensated for the services and the stage
of completion can be reliably measured. Stage of completion is measured by reference to the labour hours incurred to date
Rendering of Services
as a percentage of total estimated labour hours for each contract.
Where the contract outcome can be reliably measured, control of the right to be compensated for the services and the stage
of completion can be reliably measured. Stage of completion is measured by reference to the labour hours incurred to date
Where the contract outcome cannot be reliably measured, revenue is recognised only to the extent that costs have been
as a percentage of total estimated labour hours for each contract.
incurred.
Where the contract outcome cannot be reliably measured, revenue is recognised only to the extent that costs have been
Interest Revenue
incurred.
Control of the right to receive the interest payment. Interest revenue is recognised as it accrues, taking into account the
effective yield on the financial asset.
Interest Revenue
Control of the right to receive the interest payment. Interest revenue is recognised as it accrues, taking into account the
(p) Taxes
effective yield on the financial asset.
Tax-effect accounting is applied using the income statement liability method whereby income tax is regarded as an expense
and is calculated on the accounting profit after allowing for permanent differences. To the extent timing differences occur
(p) Taxes
between the time items are recognised in the financial statements and when items are taken into account in determining
Tax-effect accounting is applied using the income statement liability method whereby income tax is regarded as an expense
taxable income, the net related taxation benefit or liability, calculated at current rates, is disclosed as a future income tax
and is calculated on the accounting profit after allowing for permanent differences. To the extent timing differences occur
benefit or a provision for deferred income tax. The net future income tax benefit relating to tax losses and timing
between the time items are recognised in the financial statements and when items are taken into account in determining
differences is not carried forward as an asset unless the benefit is virtually certain of being realised.
taxable income, the net related taxation benefit or liability, calculated at current rates, is disclosed as a future income tax
benefit or a provision for deferred income tax. The net future income tax benefit relating to tax losses and timing
Where assets are revalued no provision for potential capital gains tax has been made.
differences is not carried forward as an asset unless the benefit is virtually certain of being realised.
Goods and Services Tax (GST)
Where assets are revalued no provision for potential capital gains tax has been made.
Revenues, expenses and assets are recognised net of the amount of GST except:
Goods and Services Tax (GST)
where the GST incurred on a purchase of goods and services is not recoverable from the taxation authority, in which
Revenues, expenses and assets are recognised net of the amount of GST except:
case the GST is recognised as part of the cost of acquisition of the asset or as part of the expense item as applicable;
and
where the GST incurred on a purchase of goods and services is not recoverable from the taxation authority, in which
receivables and payables are stated with the amount of GST included.
case the GST is recognised as part of the cost of acquisition of the asset or as part of the expense item as applicable;
and
receivables and payables are stated with the amount of GST included.
The net amount of GST recoverable from, or payable to, the taxation authority is included as part of receivables or payables
in the Statement of Financial Position.
Notes to the Financial Statements
The net amount of GST recoverable from, or payable to, the taxation authority is included as part of receivables or payables
Cash flows are included in the Statement of Cash Flows on a gross basis and the GST component of cash flows arising
in the Statement of Financial Position.
from investing and financing activities, which is recoverable from, or payable to, the taxation authority, are classified as
operating cash flows.
Cash flows are included in the Statement of Cash Flows on a gross basis and the GST component of cash flows arising
Commitments and contingencies are disclosed net of the amount of GST recoverable from, or payable to, the taxation
Pancontinental Oil & Gas NL Annual Report 2012
authority.
3
48
Annual Report 2012 | Pancontinental oil & Gas nl
Pancontinental Oil & Gas NL Annual Report 2012
(q) Employee benefits
Provision is made for employee benefits accumulated as a result of employees rendering services up to the reporting date.
3
These benefits include wages and salaries, annual leave, sick leave and long service leave.
Liabilities arising in respect of wages and salaries, annual leave, sick leave and any other employee benefits expected to be
settled within twelve months of the reporting date are measured at their nominal amounts based on remuneration rates
which are expected to be paid when the liability is settled.
Employee benefit expenses and revenues arising in respect of the following categories:
• wages and salaries, non monetary benefits, annual leave, long service leave, sick leave and other leave benefits; and
• other types of employee benefits
are charged against profits on a net basis in their respective categories.
Basic EPS is calculated as net profit attributable to members, adjusted to exclude costs of servicing equity (other than
dividends) and preference share dividends, divided by the weighted average number of ordinary shares, adjusted for any
(r) Earnings per share
bonus element.
Diluted EPS is calculated as net profit attributable to members, adjusted for:
osts of servicing equity (other than dividends);
he after tax effect of dividends and interest associated with dilutive potential ordinary shares that have been
ther non discretionary changes in revenues or expenses during the period that would result from the dilution of
c
t
o
•
•
•
recognised as expenses; and
potential ordinary shares;
element.
(s) Comparatives
divided by the weighted average number of ordinary shares and dilutive potential ordinary shares, adjusted for any bonus
Where necessary, comparatives have been reclassified and repositioned for consistency with current year disclosures.
(t) Financial Instruments
See financial instruments note for compliance notes with AASB 7, financial instruments: disclosures.
(u) New accounting standards and interpretations
The financial report is presented in Australian dollars which is the company’s functional currency. A number of new
standards, amendments to standards and interpretations are effective for the current annual report period, however, none
have been applied in preparing these consolidated financial statements. The standards are not expected to have a material
impact on the accounting policies or consolidated financial statements of the group.
4
Pancontinental Oil & Gas NL Annual Report 2012
Notes to the Financial Statements
from investing and financing activities, which is recoverable from, or payable to, the taxation authority, are classified as
Notes to the Financial Statements
operating cash flows.
from investing and financing activities, which is recoverable from, or payable to, the taxation authority, are classified as
Notes to the Financial Statements
Commitments and contingencies are disclosed net of the amount of GST recoverable from, or payable to, the taxation
operating cash flows.
authority.
Commitments and contingencies are disclosed net of the amount of GST recoverable from, or payable to, the taxation
(q) Employee benefits
authority.
Provision is made for employee benefits accumulated as a result of employees rendering services up to the reporting date.
These benefits include wages and salaries, annual leave, sick leave and long service leave.
(q) Employee benefits
Provision is made for employee benefits accumulated as a result of employees rendering services up to the reporting date.
Liabilities arising in respect of wages and salaries, annual leave, sick leave and any other employee benefits expected to be
These benefits include wages and salaries, annual leave, sick leave and long service leave.
settled within twelve months of the reporting date are measured at their nominal amounts based on remuneration rates
which are expected to be paid when the liability is settled.
Liabilities arising in respect of wages and salaries, annual leave, sick leave and any other employee benefits expected to be
settled within twelve months of the reporting date are measured at their nominal amounts based on remuneration rates
Employee benefit expenses and revenues arising in respect of the following categories:
which are expected to be paid when the liability is settled.
• wages and salaries, non monetary benefits, annual leave, long service leave, sick leave and other leave benefits; and
• other types of employee benefits
Employee benefit expenses and revenues arising in respect of the following categories:
• wages and salaries, non monetary benefits, annual leave, long service leave, sick leave and other leave benefits; and
are charged against profits on a net basis in their respective categories.
• other types of employee benefits
(r) Earnings per share
are charged against profits on a net basis in their respective categories.
Basic EPS is calculated as net profit attributable to members, adjusted to exclude costs of servicing equity (other than
dividends) and preference share dividends, divided by the weighted average number of ordinary shares, adjusted for any
(r) Earnings per share
bonus element.
Basic EPS is calculated as net profit attributable to members, adjusted to exclude costs of servicing equity (other than
dividends) and preference share dividends, divided by the weighted average number of ordinary shares, adjusted for any
Diluted EPS is calculated as net profit attributable to members, adjusted for:
bonus element.
•
c
•
osts of servicing equity (other than dividends);
Diluted EPS is calculated as net profit attributable to members, adjusted for:
Diluted EPS is calculated as net profit attributable to members, adjusted for:
•
•
t
c
he after tax effect of dividends and interest associated with dilutive potential ordinary shares that have been
osts of servicing equity (other than dividends);
recognised as expenses; and
costs of servicing equity (other than dividends);
•
•
the after tax effect of dividends and interest associated with dilutive potential ordinary shares that have been
recognised as expenses; and
•
•
other non discretionary changes in revenues or expenses during the period that would result from the dilution of
potential ordinary shares;
•
t
o
he after tax effect of dividends and interest associated with dilutive potential ordinary shares that have been
ther non discretionary changes in revenues or expenses during the period that would result from the dilution of
recognised as expenses; and
potential ordinary shares;
o
ther non discretionary changes in revenues or expenses during the period that would result from the dilution of
divided by the weighted average number of ordinary shares and dilutive potential ordinary shares, adjusted for any bonus
potential ordinary shares;
element.
divided by the weighted average number of ordinary shares and dilutive potential ordinary shares, adjusted for any bonus
(s) Comparatives
element.
Where necessary, comparatives have been reclassified and repositioned for consistency with current year disclosures.
(s) Comparatives
(t) Financial Instruments
Where necessary, comparatives have been reclassified and repositioned for consistency with current year disclosures.
See financial instruments note for compliance notes with AASB 7, financial instruments: disclosures.
(t) Financial Instruments
(u) New accounting standards and interpretations
See financial instruments note for compliance notes with AASB 7, financial instruments: disclosures.
The financial report is presented in Australian dollars which is the company’s functional currency. A number of new
standards, amendments to standards and interpretations are effective for the current annual report period, however, none
(u) New accounting standards and interpretations
have been applied in preparing these consolidated financial statements. The standards are not expected to have a material
The financial report is presented in Australian dollars which is the company’s functional currency. A number of new
impact on the accounting policies or consolidated financial statements of the group.
standards, amendments to standards and interpretations are effective for the current annual report period, however, none
have been applied in preparing these consolidated financial statements. The standards are not expected to have a material
impact on the accounting policies or consolidated financial statements of the group.
4
4
Pancontinental oil & Gas nl | Annual Report 2012
Pancontinental Oil & Gas NL Annual Report 2012
Pancontinental Oil & Gas NL Annual Report 2012
49
Notes to the Financial Statements
Notes to the Financial Statements
2.
DEPRECIATION AND WRITE OFF
Notes
Expenses
Depreciation of non-current assets:
Office furniture and equipment
Generative exploration and write off:
Exploration, evaluation and development costs
3.
INCOME TAX
(a) Income Tax (Benefit)/Expense
The prima facie tax, using tax rates applicable in the
country of operation, on profit and extraordinary items
differs from the income tax provided in the financial
statements as follows:
Prima facie tax on profit from ordinary activities
Tax effect of permanent differences:
Other items (net)
Amount not brought to account as a carried forward
future income tax benefit
Income tax expense attributable to ordinary activities
(b) Future Income Tax Benefit not taken into account
The potential future income tax benefit calculated at 30% in respect of :
CONSOLIDATED
2012
$
2011
$
1,651
1,183
42,035
58,387
CONSOLIDATED
2012
$
2011
$
(541,732)
(290,109)
-
-
541,732
-
290,109
-
-
5,965,816
5,965,816
-
5,267,832
5,267,832
Adjustments to carry forward tax losses
Tax Losses not brought to account
Total
This future income tax benefit will only be obtained if:
(a)
(b)
(c)
future assessable income is derived of a nature and of an amount sufficient to enable the benefit to be realised;
the conditions for deductibility imposed by tax legislation continue to be complied with; and
no changes in tax legislation adversely affect the consolidated entity in realising the benefit.
4.
RECEIVABLES (CURRENT)
Sundry receivables
Total
CONSOLIDATED
2011
$
44,028
44,028
2012
$
98,582
98,582
(a) Terms and conditions
(i)
(ii) Sundry debtors and other receivables are non-interest bearing and have repayment terms between 30 and 90 days.
Trade debtors are non-interest bearing and generally on 30 day terms.
50
Pancontinental Oil & Gas NL Annual Report 2012
Annual Report 2012 | Pancontinental oil & Gas nl
3
Notes to the Financial Statements
Notes to the Financial Statements
INTERESTS IN SUBSIDIARIES
5.
Name
Euro Pacific Energy Pty Ltd
Provision for diminution in value of investment
Loan to Euro Pacific Energy Pty Ltd
Provision for loss on loan to Euro Pacific Energy Pty Ltd
Pancontinental Namibia Pty Ltd
Provision for diminution in value of investment
Loan to Pancontinental Namibia Pty Ltd
Provision for loss on loan to Pancontinental Namibia P/L
Afrex Ltd *
Provision for diminution in value of investment
Loan to Afrex Ltd
Provision for loss on loan to Afrex Ltd
Starstrike Resources Ltd *
Provision for diminution in value of investment
Loan to Starstrike Resources Ltd
Provision for loss on loan to Starstrike Resources Ltd
Total
Country of
incorporation
Percentage of equity
interest held by the
consolidated entity
2012
%
2011
%
Australia
100
100
Australia
100
-
Saint Lucia
100
100
British Virgin Islands
100
100
*Indicates companies not audited by Rothsay Chartered Accountants.
6.
PROPERTY, PLANT AND EQUIPMENT
Office equipment
At cost
Less: Accumulated depreciation
Total written down amount
Reconciliations
Reconciliations of the carrying amounts of property, plant and equipment
Office equipment
Carrying amount opening balance
Additions
Depreciation expense
Total written down amount
7.
DEFERRED EXPLORATION, EVALUATION AND DEVELOPMENT COSTS
Exploration, evaluation and development costs carried forward
Pre-production:
exploration and evaluation phases:
Carrying amount at 1 July
Expenditure during the year
Exploration expenditure written off
Recovery of past exploration expenditure *
Carrying amount at 30 June
Investment
2012
$
2
(2)
(165,048)
-
1
(1)
6,351
(1,207)
10,584,107
(4,514,920)
4,682,033
-
380,000
(380,000)
54,760
-
10,646,076
2011
$
2
(2)
(165,048)
-
-
-
-
-
10,584,107
(4,489,014)
699,121
-
380,000
(380,000)
50,096
-
6,679,262
CONSOLIDATED
2011
2012
$
$
53,582
(49,984)
3,598
50,737
(48,333)
2,404
2,404
2,845
(1,651)
3,598
2,280
1,307
(1,183)
2,404
CONSOLIDATED
2011
2012
$
$
9,879,712
13,410,027
(21,187)
(56,592)
23,211,960
10,129,621
836,297
(3,055)
(1,083,151)
9,879,712
The ultimate recoupment of costs carried forward for exploration and evaluation phases is dependent on the successful development and
commercial exploitation or sale of the respective mining areas.
* The Company received reimbursement for past exploration costs during the financial year ended 30 June 2011 with regard to its Kenyan
blocks L8, L10A and L10B. For the year ended 30 June 2012, the recoveries relate to ordinary joint venture recharges.
Pancontinental oil & Gas nl | Annual Report 2012
4
Pancontinental Oil & Gas NL Annual Report 2012
51
Notes to the Financial Statements
Notes to the Financial Statements
8.
TRADE and OTHER PAYABLES (CURRENT)
Trade creditors
Total
9.
CONTRIBUTED EQUITY
(a) Issued and paid up capital
Ordinary shares fully paid
Total
(b) Movements in shares on issue
Beginning of the financial year
Issued during the year:
Placement (net of costs)
Share Purchase Plan (net of costs)
Exercise of Options (net of costs)
End of the financial year
10. RESERVES AND ACCUMULATED LOSSES
Reserves
Beginning of the financial year
Directors and employee options issued
Options expired and exercised
End of the financial year
Accumulated losses
Beginning of the financial year
Net loss attributable to members of Pancontinental Oil & Gas NL
Share options expired and exercised
Total available for appropriation
End of the financial year
CONSOLIDATED
2011
2012
$
$
235,805
235,805
187,740
187,740
CONSOLIDATED
2011
2012
$
$
95,132,106
95,132,106
38,166,253
38,166,253
2012
2011
Number of
shares
660,779,809
$
Number of
shares
$
38,166,253 592,286,658
33,433,998
457,142,858
3,271,427
2,250,000
1,123,444,094
56,323,935
512,168
129,750
-
-
68,493,151
95,132,106 660,779,809
-
-
4,732,255
38,166,253
CONSOLIDATED
2011
2012
$
$
764,258
191,179
(656,481)
298,956
1,187,215
-
(422,957)
764,258
(23,481,202)
(1,805,773)
656,481
(24,630,494)
(24,630,494)
(22,937,128)
(967,031)
422,957
(23,481,202)
(23,481,202)
Pancontinental Oil & Gas NL Annual Report 2012
3
52
Annual Report 2012 | Pancontinental oil & Gas nl
Notes to the Financial Statements
Notes to the Financial Statements
11. STATEMENT OF CASH FLOWS
(a) Reconciliation of the net loss after tax to the net cash flows from operations
Net loss
Non-Cash Items, Non-Operating Items
Depreciation of non-current assets
Options
Changes in assets and liabilities
(Increase)/decrease in trade and other receivables
(Increase)/decrease in property, plant & equipment
(Increase)/decrease in exploration, evaluation & development
(Increase)/decrease in interests in subsidiaries
(Decrease)/increase in trade and other payables
(Decrease)/increase in employee entitlements
Other non-cash
Effect of exchange rate changes
Net cash flow from operating activities
(b) Reconciliation of cash
Cash balance comprises:
cash assets
Closing cash balance
12. EXPENDITURE COMMITMENTS
Capital expenditure commitments
Estimated capital expenditure contracted for at reporting date, but not provided for, payable:
not later than one year
other
later than one year and not later than five years
other
later than five years
Total
CONSOLIDATED
2011
2012
$
$
(1,805,773)
(967,031)
1,651
191,179
1,183
-
(54,554)
(1,194)
(13,332,248)
-
48,065
-
(11,191)
-
(14,964,065)
(24,710)
(1,307)
249,909
-
80,747
-
-
-
(661,209)
47,722,233
47,722,233
5,710,905
5,710,905
CONSOLIDATED
2011
2012
$
$
1,432,795
460,653
2,874,288
3,744,326
4,307,083
4,204,979
Pancontinental oil & Gas nl | Annual Report 2012
4
Pancontinental Oil & Gas NL Annual Report 2012
53
Notes to the Financial Statements
Notes to the Financial Statements
Notes to the Financial Statements
Notes to the Financial Statements
Notes to the Financial Statements
Notes to the Financial Statements
Notes to the Financial Statements
Notes to the Financial Statements
Notes to the Financial Statements
13. EMPLOYEE BENEFITS
13. EMPLOYEE BENEFITS
13. EMPLOYEE BENEFITS
13. EMPLOYEE BENEFITS
13. EMPLOYEE BENEFITS
13. EMPLOYEE BENEFITS
13. EMPLOYEE BENEFITS
13. EMPLOYEE BENEFITS
Employee Share Scheme
Employee Share Scheme
Employee Share Scheme
Employee Share Scheme
Information with respect to the number of options under the employee share incentive scheme is as follows:
Information with respect to the number of options under the employee share incentive scheme is as follows:
Information with respect to the number of options under the employee share incentive scheme is as follows:
Information with respect to the number of options under the employee share incentive scheme is as follows:
Employee Share Scheme
Information with respect to the number of options under the employee share incentive scheme is as follows:
Employee Share Scheme
Information with respect to the number of options under the employee share incentive scheme is as follows:
Employee Share Scheme
Information with respect to the number of options under the employee share incentive scheme is as follows:
Employee Share Scheme
Information with respect to the number of options under the employee share incentive scheme is as follows:
2011
2012
2012
2012
2011
2011
Balance at beginning of year
Balance at beginning of year
Balance at beginning of year
Balance at beginning of year
Balance at beginning of year
Balance at beginning of year
Balance at beginning of year
Balance at beginning of year
expired
expired
expired
expired
expired
expired
expired
expired
exercised
exercised
exercised
exercised
exercised
exercised
exercised
exercised
issued
issued
issued
issued
issued
issued
issued
issued
Balance at end of year
Balance at end of year
Balance at end of year
Balance at end of year
Balance at end of year
Balance at end of year
Balance at end of year
Balance at end of year
2011
2012
2011
2012
2012
2012
2011
2011
Weighted
Weighted
Weighted
Weighted
Weighted
Weighted
Weighted
Weighted
Weighted
Weighted
Weighted
Weighted
Weighted
Weighted
average
average
average
average
average
average
average
average
average
average
average
average
average
average
Number of
exercise
Number of
exercise
Number of
exercise
Number of
exercise
Number of
exercise
Number of
exercise
Number of
Number of
Number of
Number of
Number of
Number of
exercise
Number of
exercise
Number of
exercise
Number of
exercise
exercise
exercise
exercise
exercise
options
price
price
options
price
price
options
price
price
price
options
price
options
price
options
options
price
price
options
options
options
options
options
options
options
options
price
price
price
0.08 23,250,000
0.08 23,250,000
0.09
0.08 23,250,000
0.08 23,250,000
0.08 23,250,000
0.08 23,250,000
0.09
0.08 23,250,000
0.09
0.09
0.09
0.09
0.09
13,750,000
13,750,000
13,750,000
13,750,000
13,750,000
13,750,000
13,750,000
13,750,000
0.09
(9,500,000)
0.09
(9,500,000)
0.09
(9,500,000)
(9,500,000)
(9,500,000)
(9,500,000)
(9,500,000)
0.09
0.09
0.09
0.09
(9,250,000)
0.10
(9,250,000)
0.10
(9,250,000)
0.10
(9,250,000)
(9,250,000)
0.10
(9,250,000)
(9,250,000)
(9,250,000)
0.10
0.10
0.10
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(2,250,000)
0.59
(2,250,000)
0.59
(2,250,000)
0.59
(2,250,000)
0.59
(2,250,000)
(2,250,000)
(2,250,000)
(2,250,000)
0.59
0.59
0.59
-
-
-
-
-
-
-
-
-
-
-
-
-
-
2,250,000
0.13
2,250,000
0.13
0.13
2,250,000
0.13
2,250,000
0.13
2,250,000
2,250,000
2,250,000
2,250,000
0.13
0.13
0.08
0.09 13,750,000
0.08
0.08
0.09 13,750,000
0.08
0.09 13,750,000
0.08
0.09 13,750,000
0.09 13,750,000
0.09 13,750,000
0.09 13,750,000
0.08
0.08
4,500,000
4,500,000
4,500,000
4,500,000
4,500,000
4,500,000
4,500,000
4,500,000
Options held at the end of the reporting period
Options held at the end of the reporting period
Options held at the end of the reporting period
The following table summarises information about options held by directors and employees as at 30 June 2012:
The following table summarises information about options held by directors and employees as at 30 June 2012:
The following table summarises information about options held by directors and employees as at 30 June 2012:
Options held at the end of the reporting period
The following table summarises information about options held by directors and employees as at 30 June 2012:
Options held at the end of the reporting period
The following table summarises information about options held by directors and employees as at 30 June 2012:
Options held at the end of the reporting period
The following table summarises information about options held by directors and employees as at 30 June 2012:
Options held at the end of the reporting period
The following table summarises information about options held by directors and employees as at 30 June 2012:
Options held at the end of the reporting period
The following table summarises information about options held by directors and employees as at 30 June 2012:
Number of options
Number of options
Number of options
Number of options
Number of options
Number of options
Number of options
Number of options
2,250,000
2,250,000
2,250,000
2,250,000
2,250,000
2,250,000
2,250,000
2,250,000
2,250,000
2,250,000
2,250,000
2,250,000
2,250,000
2,250,000
2,250,000
2,250,000
Grant date
Grant date
29 Nov 07
29 Nov 07
29 Nov 11
29 Nov 11
Grant date
29 Nov 07
29 Nov 11
Grant date
Grant date
Grant date
29 Nov 07
29 Nov 07
29 Nov 07
29 Nov 11
29 Nov 11
29 Nov 11
Grant date
29 Nov 07
29 Nov 11
Grant date
Expiry date
Expiry date
Expiry date
Expiry date
Expiry date
Expiry date
Expiry date
28 Nov 12
29 Nov 07
28 Nov 12
28 Nov 12
28 Nov 12
28 Nov 12
28 Nov 12
28 Nov 12
29 Nov 11
28 Nov 14
28 Nov 14
28 Nov 14
28 Nov 14
28 Nov 14
28 Nov 14
28 Nov 14
Weighted average exercise
Weighted average exercise
Weighted average exercise
price
price
price
0.0590
0.0590
0.0590
0.1275
0.1275
0.1275
Weighted average exercise
Weighted average exercise
Weighted average exercise
price
price
price
0.0590
0.0590
0.0590
0.1275
0.1275
0.1275
Weighted average exercise
price
0.0590
0.1275
Expiry date
28 Nov 12
28 Nov 14
14. SUBSEQUENT EVENTS
14. SUBSEQUENT EVENTS
14. SUBSEQUENT EVENTS
14. SUBSEQUENT EVENTS
14. SUBSEQUENT EVENTS
14. SUBSEQUENT EVENTS
14. SUBSEQUENT EVENTS
14. SUBSEQUENT EVENTS
Significant events after balance date include:
Significant events after balance date include:
Significant events after balance date include:
Significant events after balance date include:
Significant events after balance date include:
Significant events after balance date include:
Significant events after balance date include:
Significant events after balance date include:
12 July 2012 – Kenya L6
12 July 2012 – Kenya L6
In the company’s Kenya L6 offshore exploration licence, 3D seismic data was acquired post financial year end. The data
In the company’s Kenya L6 offshore exploration licence, 3D seismic data was acquired post financial year end. The data
acquisition covered a number of prospects, in particular the Kifaru Prospect towards the south of the licence area.
acquisition covered a number of prospects, in particular the Kifaru Prospect towards the south of the licence area.
Processing and interpretation of the data in the coming months may provide potential prospects for drilling going forward.
Processing and interpretation of the data in the coming months may provide potential prospects for drilling going forward.
12 July 2012 – Kenya L6
12 July 2012 – Kenya L6
12 July 2012 – Kenya L6
12 July 2012 – Kenya L6
12 July 2012 – Kenya L6
12 July 2012 – Kenya L6
In the company’s Kenya L6 offshore exploration licence, 3D seismic data was acquired post financial year end. The data
In the company’s Kenya L6 offshore exploration licence, 3D seismic data was acquired post financial year end. The data
In the company’s Kenya L6 offshore exploration licence, 3D seismic data was acquired post financial year end. The data
In the company’s Kenya L6 offshore exploration licence, 3D seismic data was acquired post financial year end. The data
In the company’s Kenya L6 offshore exploration licence, 3D seismic data was acquired post financial year end. The data
In the company’s Kenya L6 offshore exploration licence, 3D seismic data was acquired post financial year end. The data
acquisition covered a number of prospects, in particular the Kifaru Prospect towards the south of the licence area.
acquisition covered a number of prospects, in particular the Kifaru Prospect towards the south of the licence area.
acquisition covered a number of prospects, in particular the Kifaru Prospect towards the south of the licence area.
acquisition covered a number of prospects, in particular the Kifaru Prospect towards the south of the licence area.
acquisition covered a number of prospects, in particular the Kifaru Prospect towards the south of the licence area.
acquisition covered a number of prospects, in particular the Kifaru Prospect towards the south of the licence area.
Processing and interpretation of the data in the coming months may provide potential prospects for drilling going forward.
Processing and interpretation of the data in the coming months may provide potential prospects for drilling going forward.
Processing and interpretation of the data in the coming months may provide potential prospects for drilling going forward.
Processing and interpretation of the data in the coming months may provide potential prospects for drilling going forward.
Processing and interpretation of the data in the coming months may provide potential prospects for drilling going forward.
Processing and interpretation of the data in the coming months may provide potential prospects for drilling going forward.
19 July 2012 – Namibia EL 0037
The company increased its Namibian acreage by acquiring an additional 10% of co -venturer Paragon Holdings Limited’s
(“Paragon”) interest in the EL 0037 licence. The purchase price of the acquisition was US $4 million, with US $2 million
payable immediately and the remaining US $2 million upon the earlier of; 1) Pancontinental farming out an interest in the
licence: or 2) six months after the date of the transaction.
19 July 2012 – Namibia EL 0037
19 July 2012 – Namibia EL 0037
The company increased its Namibian acreage by acquiring an additional 10% of co-venturer Paragon Holdings Limited’s
The company increased its Namibian acreage by acquiring an additional 10% of co-venturer Paragon Holdings Limited’s
(“Paragon”) interest in the EL 0037 licence. The purchase price of the acquisition was US $4 million, with US $2 million
(“Paragon”) interest in the EL 0037 licence. The purchase price of the acquisition was US $4 million, with US $2 million
payable immediately and the remaining US $2 million upon the earlier of; 1) Pancontinental farming out an interest in the
payable immediately and the remaining US $2 million upon the earlier of; 1) Pancontinental farming out an interest in the
licence: or 2) six months after the date of the transaction.
licence: or 2) six months after the date of the transaction.
19 July 2012 – Namibia EL 0037
19 July 2012 – Namibia EL 0037
The company increased its Namibian acreage by acquiring an additional 10% of co-venturer Paragon Holdings Limited’s
The company increased its Namibian acreage by acquiring an additional 10% of co-venturer Paragon Holdings Limited’s
(“Paragon”) interest in the EL 0037 licence. The purchase price of the acquisition was US $4 million, with US $2 million
(“Paragon”) interest in the EL 0037 licence. The purchase price of the acquisition was US $4 million, with US $2 million
payable immediately and the remaining US $2 million upon the earlier of; 1) Pancontinental farming out an interest in the
payable immediately and the remaining US $2 million upon the earlier of; 1) Pancontinental farming out an interest in the
licence: or 2) six months after the date of the transaction.
licence: or 2) six months after the date of the transaction.
19 July 2012 – Namibia EL 0037
The company increased its Namibian acreage by acquiring an additional 10% of co-venturer Paragon Holdings Limited’s
(“Paragon”) interest in the EL 0037 licence. The purchase price of the acquisition was US $4 million, with US $2 million
payable immediately and the remaining US $2 million upon the earlier of; 1) Pancontinental farming out an interest in the
licence: or 2) six months after the date of the transaction.
19 July 2012 – Namibia EL 0037
The company increased its Namibian acreage by acquiring an additional 10% of co-venturer Paragon Holdings Limited’s
(“Paragon”) interest in the EL 0037 licence. The purchase price of the acquisition was US $4 million, with US $2 million
payable immediately and the remaining US $2 million upon the earlier of; 1) Pancontinental farming out an interest in the
licence: or 2) six months after the date of the transaction.
19 July 2012 – Namibia EL 0037
The company increased its Namibian acreage by acquiring an additional 10% of co-venturer Paragon Holdings Limited’s
(“Paragon”) interest in the EL 0037 licence. The purchase price of the acquisition was US $4 million, with US $2 million
payable immediately and the remaining US $2 million upon the earlier of; 1) Pancontinental farming out an interest in the
licence: or 2) six months after the date of the transaction.
31 July 2012 - Fundraising
31 July 2012 - Fundraising
31 July 2012 - Fundraising
31 July 2012 - Fundraising
The company further increased its cash reserves by announcing that the shortfall from the April 2012 Share Purchase Plan
The company further increased its cash reserves by announcing that the shortfall from the April 2012 Share Purchase Plan
The company further increased its cash reserves by announcing that the shortfall from the April 2012 Share Purchase Plan
The company further increased its cash reserves by announcing that the shortfall from the April 2012 Share Purchase Plan
was to be placed with sophisticated investors as well as international and domestic institutional clients of brokers Hartleys
was to be placed with sophisticated investors as well as international and domestic institutional clients of brokers Hartleys
was to be placed with sophisticated investors as well as international and domestic institutional clients of brokers Hartleys
was to be placed with sophisticated investors as well as international and domestic institutional clients of brokers Hartleys
Limited. 25,300,002 shares were placed at $0.175, raising $4,427,500.
Limited. 25,300,002 shares were placed at $0.175, raising $4,427,500.
Limited. 25,300,002 shares were placed at $0.175, raising $4,427,500.
Limited. 25,300,002 shares were placed at $0.175, raising $4,427,500.
31 July 2012 - Fundraising
31 July 2012 - Fundraising
The company further increased its cash reserves by announcing that the shortfall from the April 2012 Share Purchase Plan
The company further increased its cash reserves by announcing that the shortfall from the April 2012 Share Purchase Plan
was to be placed with sophisticated investors as well as international and domestic institutional clients of brokers Hartleys
was to be placed with sophisticated investors as well as international and domestic institutional clients of brokers Hartleys
Limited. 25,300,002 shares were placed at $0.175, raising $4,427,500.
Limited. 25,300,002 shares were placed at $0.175, raising $4,427,500.
31 July 2012 - Fundraising
31 July 2012 - Fundraising
The company further increased its cash reserves by announcing that the shortfall from the April 2012 Share Purchase Plan
The company further increased its cash reserves by announcing that the shortfall from the April 2012 Share Purchase Plan
was to be placed with sophisticated investors as well as international and domestic institutional clients of brokers Hartleys
was to be placed with sophisticated investors as well as international and domestic institutional clients of brokers Hartleys
Limited. 25,300,002 shares were placed at $0.175, raising $4,427,500.
Limited. 25,300,002 shares were placed at $0.175, raising $4,427,500.
13 August 2012 – Kenya L8
13 August 2012 – Kenya L8
13 August 2012 – Kenya L8
13 August 2012 – Kenya L8
13 August 2012 – Kenya L8
13 August 2012 – Kenya L8
13 August 2012 – Kenya L8
13 August 2012 – Kenya L8
Operator Apache Corporation, on behalf of the Kenya L8 joint venture commenced drilling the Mbawa prospect in August
Operator Apache Corporation, on behalf of the Kenya L8 joint venture commenced drilling the Mbawa prospect in August
Operator Apache Corporation, on behalf of the Kenya L8 joint venture commenced drilling the Mbawa prospect in August
Operator Apache Corporation, on behalf of the Kenya L8 joint venture commenced drilling the Mbawa prospect in August
Operator Apache Corporation, on behalf of the Kenya L8 joint venture commenced drilling the Mbawa prospect in August
Operator Apache Corporation, on behalf of the Kenya L8 joint venture commenced drilling the Mbawa prospect in August
Operator Apache Corporation, on behalf of the Kenya L8 joint venture commenced drilling the Mbawa prospect in August
Operator Apache Corporation, on behalf of the Kenya L8 joint venture commenced drilling the Mbawa prospect in August
2012. On 10 September 2012, Pancontinental announced that at a depth of 2,553m the Mbawa well encountered
2012. On 10 September 2012, Pancontinental announced that at a depth of 2,553m the Mbawa well encountered
2012. On 10 September 2012, Pancontinental announced that at a depth of 2,553m the Mbawa well encountered
2012. On 10 September 2012, Pancontinental announced that at a depth of 2,553m the Mbawa well encountered
2012. On 10 September 2012, Pancontinental announced that at a depth of 2,553m the Mbawa well encountered
2012. On 10 September 2012, Pancontinental announced that at a depth of 2,553m the Mbawa well encountered
2012. On 10 September 2012, Pancontinental announced that at a depth of 2,553m the Mbawa well encountered
2012. On 10 September 2012, Pancontinental announced that at a depth of 2,553m the Mbawa well encountered
approximately 52 net metres of natural gas pay in porous Cretaceous sandstones. The gas discovered by drilling the Mbawa
approximately 52 net metres of natural gas pay in porous Cretaceous sandstones. The gas discovered by drilling the Mbawa
approximately 52 net metres of natural gas pay in porous Cretaceous sandstones. The gas discovered by drilling the Mbawa
approximately 52 net metres of natural gas pay in porous Cretaceous sandstones. The gas discovered by drilling the Mbawa
approximately 52 net metres of natural gas pay in porous Cretaceous sandstones. The gas discovered by drilling the Mbawa
approximately 52 net metres of natural gas pay in porous Cretaceous sandstones. The gas discovered by drilling the Mbawa
approximately 52 net metres of natural gas pay in porous Cretaceous sandstones. The gas discovered by drilling the Mbawa
approximately 52 net metres of natural gas pay in porous Cretaceous sandstones. The gas discovered by drilling the Mbawa
well was the first of its kind offshore Kenya. Total depth of 3,151m was reached on 12 September 2012, however the deeper
well was the first of its kind offshore Kenya. Total depth of 3,151m was reached on 12 September 2012, however the deeper
well was the first of its kind offshore Kenya. Total depth of 3,151m was reached on 12 September 2012, however the deeper
well was the first of its kind offshore Kenya. Total depth of 3,151m was reached on 12 September 2012, however the deeper
well was the first of its kind offshore Kenya. Total depth of 3,151m was reached on 12 September 2012, however the deeper
well was the first of its kind offshore Kenya. Total depth of 3,151m was reached on 12 September 2012, however the deeper
well was the first of its kind offshore Kenya. Total depth of 3,151m was reached on 12 September 2012, however the deeper
well was the first of its kind offshore Kenya. Total depth of 3,151m was reached on 12 September 2012, however the deeper
target did not contain hydrocarbons. Further work continues to assess the potential of the gas encountered at 2,553m.
target did not contain hydrocarbons. Further work continues to assess the potential of the gas encountered at 2,553m.
target did not contain hydrocarbons. Further work continues to assess the potential of the gas encountered at 2,553m.
target did not contain hydrocarbons. Further work continues to assess the potential of the gas encountered at 2,553m.
target did not contain hydrocarbons. Further work continues to assess the potential of the gas encountered at 2,553m.
target did not contain hydrocarbons. Further work continues to assess the potential of the gas encountered at 2,553m.
target did not contain hydrocarbons. Further work continues to assess the potential of the gas encountered at 2,553m.
target did not contain hydrocarbons. Further work continues to assess the potential of the gas encountered at 2,553m.
24 August 2012 - Corporate
24 August 2012 - Corporate
The company provided shareholders with a Notice of Meeting for 27 September 2012 where they will be asked to vote on
The company provided shareholders with a Notice of Meeting for 27 September 2012 where they will be asked to vote on
two resolutions with regard to the adoption of a new constitution for the company.
two resolutions with regard to the adoption of a new constitution for the company.
24 August 2012 - Corporate
24 August 2012 - Corporate
The company provided shareholders with a Notice of Meeting for 27 September 2012 where they will be asked to vote on
The company provided shareholders with a Notice of Meeting for 27 September 2012 where they will be asked to vote on
two resolutions with regard to the adoption of a new constitution for the company.
two resolutions with regard to the adoption of a new constitution for the company.
24 August 2012 - Corporate
The company provided shareholders with a Notice of Meeting for 27 September 2012 where they will be asked to vote on
two resolutions with regard to the adoption of a new constitution for the company.
24 August 2012 - Corporate
The company provided shareholders with a Notice of Meeting for 27 September 2012 where they will be asked to vote on
two resolutions with regard to the adoption of a new constitution for the company.
24 August 2012 - Corporate
The company provided shareholders with a Notice of Meeting for 27 September 2012 where they will be asked to vote on
two resolutions with regard to the adoption of a new constitution for the company.
24 August 2012 - Corporate
The company provided shareholders with a Notice of Meeting for 27 September 2012 where they will be asked to vote on
two resolutions with regard to the adoption of a new constitution for the company.
Apart from the above, no matters or circumstances have arisen since the end of the financial year which significantly
affected or may significantly affect the operations of the company, the results of those operations, or the state of affairs of
the company in future financial years.
Apart from the above, no matters or circumstances have arisen since the end of the financial year which significantly
Apart from the above, no matters or circumstances have arisen since the end of the financial year which significantly
affected or may significantly affect the operations of the company, the results of those operations, or the state of affairs of
affected or may significantly affect the operations of the company, the results of those operations, or the state of affairs of
the company in future financial years.
the company in future financial years.
Apart from the above, no matters or circumstances have arisen since the end of the financial year which significantly
affected or may significantly affect the operations of the company, the results of those operations, or the state of affairs of
the company in future financial years.
Apart from the above, no matters or circumstances have arisen since the end of the financial year which significantly
affected or may significantly affect the operations of the company, the results of those operations, or the state of affairs of
the company in future financial years.
Apart from the above, no matters or circumstances have arisen since the end of the financial year which significantly
affected or may significantly affect the operations of the company, the results of those operations, or the state of affairs of
the company in future financial years.
Apart from the above, no matters or circumstances have arisen since the end of the financial year which significantly
affected or may significantly affect the operations of the company, the results of those operations, or the state of affairs of
the company in future financial years.
Apart from the above, no matters or circumstances have arisen since the end of the financial year which significantly
affected or may significantly affect the operations of the company, the results of those operations, or the state of affairs of
the company in future financial years.
2012
2011
Weighted
average
exercise
price
Number of
options
0.08 23,250,000
(9,500,000)
0.10
0.59
0.13
-
-
0.09 13,750,000
Weighted
average
exercise
price
0.09
0.09
-
-
0.08
Weighted average exercise
price
0.0590
0.1275
3
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Pancontinental Oil & Gas NL Annual Report 2012
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54
Pancontinental Oil & Gas NL Annual Report 2012
3
3
3
3
3
3
3
Notes to the Financial Statements
Notes to the Financial Statements
Notes to the Financial Statements
15. EARNINGS PER SHARE
15. EARNINGS PER SHARE
2012
$
The following reflects the income and share data used in the calculations of basic and diluted earnings per share:
The following reflects the income and share data used in the calculations of basic and diluted earnings per share:
(967,031)
Net profit
Net profit
(967,031)
(1,805,773)
Adjustments:
Adjustments:
Earnings used in calculating basic and diluted earnings per
Earnings used in calculating basic and diluted earnings per
share
share
2011
$
(1,805,773)
(967,031)
(967,031)
(1,805,773)
(1,805,773)
CONSOLIDATED
2012
$
CONSOLIDATED
2011
$
Number of shares
Number of shares
Number of shares
Number of shares
Weighted average number of ordinary shares used in
Weighted average number of ordinary shares used in
calculating basic earnings per share
calculating basic earnings per share
Effect of dilutive securities:
Effect of dilutive securities:
Share options
Share options
Adjusted weighted average number of ordinary shares used
Adjusted weighted average number of ordinary shares used
in calculating diluted earnings per share
in calculating diluted earnings per share
4,500,000
795,045,367
799,545,367
16. AUDITORS' REMUNERATION
16. AUDITORS' REMUNERATION
Amounts received or due and receivable by Rothsay for:
Amounts received or due and receivable by Rothsay for:
an audit or review of the financial report of the entity
an audit or review of the financial report of the entity
and any other entity in the consolidated entity
and any other entity in the consolidated entity
other services in relation to the entity and any other
entity in the consolidated entity
entity in the consolidated entity
other services in relation to the entity and any other
795,045,367
605,985,288
605,985,288
4,500,000
13,750,000
13,750,000
799,545,367
619,735,288
619,735,288
CONSOLIDATED
CONSOLIDATED
2012
$
2011
$
2012
$
2011
$
40,500
45,500
40,500
45,500
4,000
44,500
4,000
49,500
4,000
44,500
4,000
49,500
17. DIRECTOR AND EXECUTIVE DISCLOSURES
(a) Details of Specified Directors and Specified Executives
(i) Specified Directors
Henry David Kennedy
Roy Barry Rushworth
Ernest Anthony Myers
Anthony Robert Frederick Maslin
(ii) Specified Executives
Vesna Petrovic
17. DIRECTOR AND EXECUTIVE DISCLOSURES
(a) Details of Specified Directors and Specified Executives
(i) Specified Directors
Henry David Kennedy
Roy Barry Rushworth
Ernest Anthony Myers
Anthony Robert Frederick Maslin
(ii) Specified Executives
Vesna Petrovic
Company Secretary
Company Secretary
Non-Executive Chairman
Executive Director, Chief Executive Officer
Executive Finance Director
Non-Executive Director
Non-Executive Chairman
Executive Director, Chief Executive Officer
Executive Finance Director
Non-Executive Director
Pancontinental oil & Gas nl | Annual Report 2012
4
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Pancontinental Oil & Gas NL Annual Report 2012
55
Pancontinental Oil & Gas NL Annual Report 2012
Notes to the Financial Statements
Notes to the Financial Statements
Total remuneration for all non-executive directors, last voted upon by shareholders at the 2007 AGM, is not to exceed
$400,000 per annum and is set with reference to fees paid to other non-executive directors of comparable companies.
Non-executive and executive directors do not receive performance related remuneration but they are eligible to participate in
the Employee Option Scheme approved by shareholders.
Directors do not receive any termination or retirement benefits.
(b) Remuneration of Specified Directors /Officers
Salary
& Fees
Primary
Cash
Bonus
Non
Monetary
benefits
Post Employment
Superannuation Retirement
Equity
Other
Options Bonuses
Total
benefits
50,000 -
50,000 -
-
-
-
-
-
-
63,726
-
- 113,726
50,000
-
Specified
Directors/Officers
Henry David Kennedy
2012
2011
Roy Barry Rushworth
2012
2011
Ian Raymond (Inky) Cornelius
(Passed away 14 July 2010)
550,000
415,833
-
-
-
-
-
-
-
-
127,453
-
-
-
677,453
415,833
2012
2011
-
2,000
-
-
-
-
-
-
-
-
-
-
-
-
-
2,000
Anthony Robert Frederick Maslin
2012
2011
48,000
25,806
-
-
-
-
-
-
-
-
-
-
-
-
48,000
25,806
Ernest Anthony Myers
2012
2011
Vesna Petrovic
2012
2011
48,000
48,000
-
-
-
-
-
-
-
-
-
-
-
48,000
48,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Total Remuneration: Specified Directors /Officers
2012
2011
696,000
541,639
-
-
-
-
-
-
-
-
191,179
-
-
-
887,179
541,639
Mrs Petrovic received no direct remuneration from the company for her services as company secretary however during the
year the company paid fees to Resource Services International (Aust) Pty Limited totalling $289,500 (2011: $238,000) for
the provision of corporate, accounting and administration services. Mrs Petrovic is employed by Resource Services
International (Aust) Pty Limited. See Note 20 for further information.
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Pancontinental Oil & Gas NL Annual Report 2012
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3
Notes to the Financial Statements
Notes to the Financial Statements
(c) Remuneration options: Granted and vested during the year
Terms & Conditions for Each Grant
Granted
Number
Grant Date
Value per
option at
grant date ($)
Exercise Price per
share ($)
First Exercise
Date
Last Exercise
Date
Specified Directors
Henry David Kennedy
Roy Barry Rushworth
Anthony Robert Frederick Maslin
Ernest Anthony Myers
Total
750,000
1,500,000
-
-
2,250,000
29 Nov 11
29 Nov 11
-
-
0.08
0.08
-
-
0.1275
0.1275
-
-
29 May 12
29 May 12
-
-
28 Nov 14
28 Nov 14
-
-
(d) Option holdings of specified directors and specified executives
Balance at
beginning of period
1 July 2011
Granted as
Remuneration
Options Exercised/
(Expired)
Specified Directors
Henry David Kennedy
Roy Barry Rushworth
Anthony Robert Frederick Maslin
Ernest Anthony Myers
Total
1,500,000
3,000,000
-
1,000,000
5,500,000
750,000
1,500,000
-
-
2,250,000
(750,000)
(1,500,000)
-
(1,000,000)
(4,000,000)
-
-
-
-
-
period
30 June 2012
1,500,000
3,000,000
-
-
4,500,000
Net Change Other Balance at end of
(e) Shareholdings of Specified Directors and Specified Executives
Ordinary Shares held in Pancontinental Oil & Gas NL
Specified Directors
Henry David Kennedy
Roy Barry Rushworth
Anthony Robert Frederick Maslin
Ernest Anthony Myers
Total
Balance
1 July 2011
155,301,968
34,764,181
-
-
190,066,149
Acquisitions
(Disposals)
Balance
30 June 2012
(22,000,366)
571,429
14,583
285,715
(21,128,639)
133,301,602
35,335,610
14,583
285,715
168,937,510
4
Pancontinental oil & Gas nl | Annual Report 2012
Pancontinental Oil & Gas NL Annual Report 2012
57
Notes to the Financial Statements
Notes to the Financial Statements
18. SEGMENT INFORMATION
Segment accounting policies
The group has adopted AASB 8 Operating Segments which requires operating segments to be identified on the basis of
internal reports about components of the group that are reviewed by the chief operating decision-maker in order to allocate
resources to the segment and to assess its performance.
The board of Pancontinental reviews internal reports prepared as consolidated financial statements and strategic decisions of
the group are determined upon analysis of these internal reports. During the period the group operated predominately in one
Notes to the Financial Statements
business segment, being the oil and gas sector. Accordingly, under the management approach outlined only one operating
sector has been identified and no further disclosures are required in the notes to the consolidated financial statements.
19. FINANCIAL INSTRUMENTS
Financial risk management
Overview:
The company and group have exposure to the following risks from their use of financial instruments:
(a) credit risk
(b) liquidity risk
(c) market risk
This note presents information about the company’s and group’s exposure to each of the above risks, their objectives, policies
and processes for measuring and managing risk, and the management of capital.
The board of directors has overall responsibility for the establishment and oversight of the risk management framework.
Management monitors and manages the financial risks relating to the operations of the group through regular reviews of the
risks.
(a) Credit risk:
Credit risk is the risk of financial loss to the group if a customer or counterparty to a financial instrument fails to meet its
contractual obligations. In this industry, it arises principally from the receivables of joint venture re-charges and
recuperations of cost. For the group, it arises from receivables due from subsidiaries and re-charges to joint venture partners.
(i) Trade and other receivables:
The group operates predominantly in the oil and gas exploration sector; it does not have trade receivables and is therefore not
exposed to credit risk in relation to trade receivables.
The company’s and group’s exposure to credit risk is influenced directly and indirectly by the individual characteristics of
each joint venture. The balance of any outstanding amounts is monitored and payments are received promptly from joint
venture partners.
(ii) Loans to subsidiaries:
The company has provided funding to its subsidiaries by way of loans. Based on management’s review of the subsidiaries net
tangible asset position and cash flow projections, the current carrying value of the loans have been assessed to be fully
recoverable. Repayment of these loans will occur through future business activities of each respective entity.
58
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4
Pancontinental Oil & Gas NL Annual Report 2012
Notes to the Financial Statements
Notes to the Financial Statements
Notes to the Financial Statements
19. FINANCIAL INSTRUMENTS (cont’d)
19. FINANCIAL INSTRUMENTS (cont’d)
Exposure to credit risk
Exposure to credit risk
The carrying amount of the company’s and group’s financial assets represents the maximum credit exposure. The maximum
exposure to credit risk at the reporting date was:
The carrying amount of the company’s and group’s financial assets represents the maximum credit exposure. The maximum
exposure to credit risk at the reporting date was:
Consolidated
Consolidated
Trade and other receivables
Cash and cash equivalents
Total
Trade and other receivables
Cash and cash equivalents
Total
Impairment losses:
Impairment losses:
Note
Note
4
4
Carrying amount
2012
2012
$
$
98,582
98,582
47,722,233
47,722,233
47,820,815
47,820,815
Carrying amount
2011
2011
$
$
44,028
44,028
5,710,905
5,710,905
5,754,933
5,754,933
None of the company’s or group’s receivables are past due at 30 June 2012, (2011: nil).
None of the company’s or group’s receivables are past due at 30 June 2012, (2011: nil).
An impairment write down in respect of inter-group loans and shares was recognised during the current year from an
An impairment write down in respect of inter-group loans and shares was recognised during the current year from an
analysis of the subsidiaries respective financial positions. The total impairment write down recognised through impairment
analysis of the subsidiaries respective financial positions. The total impairment write down recognised through impairment
of loans to subsidiaries and shares held in subsidiaries during the current period was $27,114 (2011: $17,542).
of loans to subsidiaries and shares held in subsidiaries during the current period was $27,114 (2011: $17,542).
Whilst the loans were not payable at 30 June 2012 a provision for impairment based/reversed on the subsidiaries financial
position was carried forward from previous periods. The balance of this provision may vary due to performance of a
subsidiary in a given year.
Whilst the loans were not payable at 30 June 2012 a provision for impairment based/reversed on the subsidiaries financial
position was carried forward from previous periods. The balance of this provision may vary due to performance of a
subsidiary in a given year.
(b) Liquidity risk:
(b) Liquidity risk:
Liquidity risk is the risk that the group will not be able to meet its financial obligations as they fall due. The group’s
approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its
liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to
the group’s reputation.
Liquidity risk is the risk that the group will not be able to meet its financial obligations as they fall due. The group’s
approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its
liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to
the group’s reputation.
The group manages liquidity risk by maintaining adequate cash reserves through continuously monitoring forecast and
actual cash flows.
The group manages liquidity risk by maintaining adequate cash reserves through continuously monitoring forecast and
actual cash flows.
(c) Market risk:
(c) Market risk:
Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity prices will
affect the group’s income or the value of its holdings of financial instruments. The objective of market risk management is
to manage and control market risk exposures within acceptable parameters, while optimising the return.
Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity prices will
affect the group’s income or the value of its holdings of financial instruments. The objective of market risk management is
to manage and control market risk exposures within acceptable parameters, while optimising the return.
(i) Currency risk:
(i) Currency risk:
The group is exposed to currency risk on investments, and foreign currency denominated purchases in a currency other than
the respective functional currencies of group entities, primarily the Australian dollar (AUD). The other material currency
that these transactions are denominated in is the (USD).
The group is exposed to currency risk on investments, and foreign currency denominated purchases in a currency other than
the respective functional currencies of group entities, primarily the Australian dollar (AUD). The other material currency
that these transactions are denominated in is the (USD).
The group has not entered into any derivative financial instruments to hedge such transactions and anticipated future
receipts or payments that are denominated in a foreign currency.
The group has not entered into any derivative financial instruments to hedge such transactions and anticipated future
receipts or payments that are denominated in a foreign currency.
Pancontinental oil & Gas nl | Annual Report 2012
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59
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Notes to the Financial Statements
Notes to the Financial Statements
Notes to the Financial Statements
19. FINANCIAL INSTRUMENTS (cont’d)
19. FINANCIAL INSTRUMENTS (cont’d)
Exposure to currency risk:
Exposure to currency risk:
The group’s exposure to foreign currency risk at balance date was as follows, based on notional amounts:
The group’s exposure to foreign currency risk at balance date was as follows, based on notional amounts:
AUD
AUD
Cash & cash equivalents
Cash & cash equivalents
Trade and other
Trade and other
receivables
receivables
Trade and other payables
Trade and other payables
Net balance sheet
Net balance sheet
exposure
exposure
AUD
AUD
45,675,133
45,675,133
98,582
98,582
30 June 2012
30 June 2012
USD
USD
Total
Total
47,722,233
47,722,233
2,047,100
2,047,100
98,582
-
98,582
-
AUD
AUD
5,710,905
5,710,905
44,028
44,028
30 June 2011
30 June 2011
Total
USD
USD
Total
5,710,905
5,710,905
-
-
44,028
-
44,028
-
(235,805)
45,537,910
(235,805)
45,537,910
-
(235,805)
-
2,047,100
45,537,910
2,047,100
(235,805)
45,537,910
(187,740)
5,567,193
(187,740)
5,567,193
-
-
-
(187,740)
-
5,567,193
(187,740)
5,567,193
The following significant exchange rates applied during the year:
The following significant exchange rates applied during the year:
AUD : USD
AUD : USD
Sensitivity analysis:
Sensitivity analysis:
Average rate
Average rate
2012
1.032
2012
1.032
2011
0.989
2011
0.989
Reporting date spot rate
Reporting date spot rate
2012
1.016
2012
1.016
2011
1.060
2011
1.060
A 10 percent strengthening of the Australian dollar against the USD at 30 June would have increased (decreased) equity and
profit or loss by the amounts shown below. This analysis assumes that all other variables, in particular interest rates, remain
constant. The analysis is performed on the same basis for 2011.
A 10 percent strengthening of the Australian dollar against the USD at 30 June would have increased (decreased) equity and
profit or loss by the amounts shown below. This analysis assumes that all other variables, in particular interest rates, remain
constant. The analysis is performed on the same basis for 2011.
Effect in AUD
Effect in AUD
30 June 2012
30 June 2012
10% strengthening
10% strengthening
30 June 2011
30 June 2011
10% strengthening
10% strengthening
Consolidated
Consolidated
Equity
Equity
Profit or loss
Profit or loss
-
-
-
-
-
-
-
-
A 10 percent weakening of the Australian dollar against the USD at 30 June would have had the equal but opposite effect on
the above currencies to the amounts shown above, on the basis that all other variables remain constant.
A 10 percent weakening of the Australian dollar against the USD at 30 June would have had the equal but opposite effect on
the above currencies to the amounts shown above, on the basis that all other variables remain constant.
The reason that the sensitivity analysis above had no effect on the equity or profit and loss of the company is that the
transactions in foreign currencies are predominately guarantees for exploration expenditure and would not have an effect on
the financial position of the company until their maturity date and only then, if the guarantee is to be extended and that
extension is at a different AUD to USD rate.
The reason that the sensitivity analysis above had no effect on the equity or profit and loss of the company is that the
transactions in foreign currencies are predominately guarantees for exploration expenditure and would not have an effect on
the financial position of the company until their maturity date and only then, if the guarantee is to be extended and that
extension is at a different AUD to USD rate.
Interest rate risk:
At balance date the group had exposure to interest rate risk, through its cash and equivalents held within financial institution.
Interest rate risk:
At balance date the group had exposure to interest rate risk, through its cash and equivalents held within financial institution.
Variable rate instruments
Cash and cash equivalents
Variable rate instruments
Cash and cash equivalents
Fair value sensitivity analysis for fixed rate instruments:
Fair value sensitivity analysis for fixed rate instruments:
Consolidated Carrying Amount
30 June 2011
30 June 2012
Consolidated Carrying Amount
30 June 2011
30 June 2012
47,722,233
47,722,233
5,710,905
5,710,905
The company and group do not account for any fixed rate financial assets at fair value through profit or loss. Therefore, a
change in interest rates at reporting date would not affect profit or loss or equity.
The company and group do not account for any fixed rate financial assets at fair value through profit or loss. Therefore, a
change in interest rates at reporting date would not affect profit or loss or equity.
4
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Pancontinental Oil & Gas NL Annual Report 2012
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Pancontinental Oil & Gas NL Annual Report 2012
Notes to the Financial Statements
Notes to the Financial Statements
19.
FINANCIAL INSTRUMENTS (cont’d)
Fair values:
The fair values of financial assets and liabilities, together with the carrying amounts shown in the balance sheet, are as
follows:
Consolidated
30 June 2012
30 June 2011
Trade and other receivables
Cash and cash equivalents
Trade and other payables
Carrying
amount
98,582
47,722,233
(235,805)
47,585,010
Fair value
98,582
47,722,233
(235,805)
47,585,010
Carrying
amount
44,028
5,710,905
(187,740)
5,567,193
Fair value
44,028
5,710,905
(187,740)
5,567,193
The basis for determining fair values is disclosed in note [ 1 ].
Capital Management:
The board’s policy is to maintain a strong capital base so as to maintain investor, creditor and market confidence and to
sustain future development of the business. The board of directors monitors the return on capital, which the group defines as
net operating income divided by total shareholders’ equity, excluding non-redeemable preference shares and minority
interests.
Equity attributable to shareholders of the Company
Minorities
Equity
Total assets
Equity ratio in %
Average equity
Net Profit
Return on Equity in %
2012
2011
-
70,800,568
71,036,373
99.67%
43,124,939
(1,805,773)
(4.19)%
-
15,449,309
15,637,049
98.80%
13,566,697
(967,031)
(7.13)%
There were no changes in the group’s approach to capital management during the year.
Neither the company nor any of its subsidiaries are subject to externally imposed capital requirements.
Pancontinental oil & Gas nl | Annual Report 2012
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61
Notes to the Financial Statements
Notes to the Financial Statements
Notes to the Financial Statements
Notes to the Financial Statements
20. RELATED PARTY
20. RELATED PARTY
20. RELATED PARTY
(a) During the year the company paid fees to Resource Services International Limited, a company in which Mr Kennedy has
a financial interest, for consulting services. The amount paid to was $50,000 (2011: $50,000). Refer note 17.
a financial interest, for consulting services. The amount paid to was $50,000 (2011: $50,000). Refer note 17.
(a) During the year the company paid fees to Resource Services International Limited, a company in which Mr Kennedy has
(a) During the year the company paid fees to Resource Services International Limited, a company in which Mr Kennedy has
a financial interest, for consulting services. The amount paid to was $50,000 (2011: $50,000). Refer note 17.
(b) During the year the company paid fees to Resource Services International (Aust) Pty Limited, a company of which Mr
(b) During the year the company paid fees to Resource Services International (Aust) Pty Limited, a company of which Mr
(b) During the year the company paid fees to Resource Services International (Aust) Pty Limited, a company of which Mr
Myers is a director, to cover the provision of corporate, accounting and administration services. The amount paid to
Myers is a director, to cover the provision of corporate, accounting and administration services. The amount paid to
Myers is a director, to cover the provision of corporate, accounting and administration services. The amount paid to
Resource Services International (Aust) Pty Limited was $289,500 (2011: $238,000). Amounts were billed based on
Resource Services International (Aust) Pty Limited was $289,500 (2011: $238,000). Amounts were billed based on
Resource Services International (Aust) Pty Limited was $289,500 (2011: $238,000). Amounts were billed based on
normal market rates for such services and were due and payable under normal payment terms. The fees are not related to
normal market rates for such services and were due and payable under normal payment terms. The fees are not related to
normal market rates for such services and were due and payable under normal payment terms. The fees are not related to
the management of the company, therefore no amounts are attributable to directors, and have not been included in
the management of the company, therefore no amounts are attributable to directors, and have not been included in
the management of the company, therefore no amounts are attributable to directors, and have not been included in
directors’ remuneration.
directors’ remuneration.
directors’ remuneration.
(c) The company has effected Directors and Officers Liability Insurance.
(c) The company has effected Directors and Officers Liability Insurance.
(c) The company has effected Directors and Officers Liability Insurance.
21. PARENT INFORMATION
21. PARENT INFORMATION
21. PARENT INFORMATION
The Group has applied amendments to the Corporations Act (2001) which remove the requirement for the Group to lodge
parent entity financial statements. Parent entity financial statements have been replaced by the specific parent entity
disclosures below.
The Group has applied amendments to the Corporations Act (2001) which remove the requirement for the Group to lodge
The Group has applied amendments to the Corporations Act (2001) which remove the requirement for the Group to lodge
parent entity financial statements. Parent entity financial statements have been replaced by the specific parent entity
parent entity financial statements. Parent entity financial statements have been replaced by the specific parent entity
disclosures below.
disclosures below.
AT 30 JUNE 2012
AT 30 JUNE 2012
AT 30 JUNE 2012
STATEMENT OF COMPREHENSIVE
INCOME
STATEMENT OF COMPREHENSIVE
STATEMENT OF COMPREHENSIVE
INCOME
INCOME
Profit/(Loss) for the period
Profit/(Loss) for the period
Profit/(Loss) for the period
TOTAL COMPREHENSIVE
TOTAL COMPREHENSIVE
TOTAL COMPREHENSIVE
INCOME/(LOSS)
INCOME/(LOSS)
INCOME/(LOSS)
STATEMENT OF FINANCIAL POSITION
STATEMENT OF FINANCIAL POSITION
STATEMENT OF FINANCIAL POSITION
Assets
Assets
Assets
Current assets
Current assets
Current assets
TOTAL ASSETS
TOTAL ASSETS
TOTAL ASSETS
Liabilities
Liabilities
Liabilities
Current liabilities
Current liabilities
Current liabilities
TOTAL LIABILITIES
TOTAL LIABILITIES
TOTAL LIABILITIES
Equity
Equity
Equity
Contributed equity
Contributed equity
Contributed equity
Reserves
Reserves
Reserves
Accumulated losses
Accumulated losses
Accumulated losses
TOTAL EQUITY
TOTAL EQUITY
TOTAL EQUITY
2012
2012
2012
$
$
$
2011
2011
2011
$
$
$
(1,799,775)
(1,799,775)
(1,799,775)
(914,717)
(914,717)
(914,717)
(1,799,775)
(1,799,775)
(1,799,775)
(914,717)
(914,717)
(914,717)
2012
2012
2012
$
$
$
2011
2011
2011
$
$
$
47,017,877
47,017,877
47,017,877
5,710,905
5,710,905
5,710,905
70,923,805
70,923,805
70,923,805
15,520,246
15,520,246
15,520,246
232,041
232,041
232,041
232,041
232,041
232,041
185,740
185,740
185,740
185,740
185,740
185,740
95,132,106
95,132,106
95,132,106
298,956
298,956
298,956
(24,739,298)
(24,739,298)
(24,739,298)
70,691,764
70,691,764
70,691,764
38,166,253
38,166,253
38,166,253
764,258
764,258
764,258
(23,596,005)
(23,596,005)
(23,596,005)
15,334,506
15,334,506
15,334,506
4
4
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Annual Report 2012 | Pancontinental oil & Gas nl
Pancontinental Oil & Gas NL Annual Report 2012
Notes to the Financial Statements
Directors’ Declaration
In accordance with a resolution of the directors of Pancontinental Oil & Gas NL, I state that:
(1) In the opinion of the directors:
(a) the financial statements and notes of the company and of the consolidated entity are in accordance with the
Corporations Act 2001, including:
i. giving a true and fair view of the company's and consolidated entity's financial position as at
30 June 2012 and of their performance for the year ended on that date; and
ii. complying with Accounting Standards and Corporations Regulations 2001; and
(b) there are reasonable grounds to believe that the company will be able to pay its debts as and when they
become due and payable.
(2) This declaration has been made after receiving the declarations required to be made to the directors in accordance
with section 295A of the Corporations Act 2001 for the financial period ending 30 June 2012.
On behalf of the Board
Ernest Anthony Myers
Director
Perth 27 September 2012
Pancontinental oil & Gas nl | Annual Report 2012
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Independent Audit Report
64
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Independent Audit Report
65
Pancontinental oil & Gas nl | Annual Report 2012
Pancontinental Oil & Gas NL Annual Report 2012
65
Additional ASX Information
Additional ASX Information
Additional information required by the ASX Ltd and not shown elsewhere in this report is as follows. The information is current as at 30
September 2012.
(a) Distribution of equity securities
The number of shareholders, by size of holding, in each class of share are:
1
1,001
5,001
10,001
100,001
-
-
-
-
1,000
5,000
10,000
100,000
and over
The number of shareholders holding less than a marketable parcel of shares are:
(b) Twenty largest shareholders
The names of the twenty largest holders of quoted shares are:
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
SUNDOWNER INTERNATIONAL LTD
JP MORGAN NOMINEES AUSTRALIA LIMITED
CITICORP NOMINEES PTY LIMITED
NATIONAL NOMINEES LIMITED
CM SKYE TRUSTEES LIMITED
DESERTFOX PTY LTD
MERRILL LYNCH (AUSTRALIA) NOMINEES PTY LIMITED
BLUE CAPITAL LIMITED
CS FOURTH NOMINEES PTY LTD
BRISPOT NOMINEES PTY LTD
ROY BARRY RUSHWORTH
BLUE CAPITAL LIMITED
MR PETER JOHN BRUNTON
MR ROBERT ALBERT BOAS
P & L CAPITAL INVESTMENTS PTY LTD
OLD BLOOD AND GUTS PTY LTD
QUICKSILVER ASSET PTY LTD
MR JAMES DAVID TAYLOR
M & M FAMILY PTY LTD
(c) Voting rights
All ordinary shares (whether fully paid or not) carry one vote per share without restriction.
Ordinary shares
Number of holders
394
450
591
2,330
857
4,622
710
Number of shares
88,992
1,647,838
5,032,216
99,425,217
1,042,549,833
1,148,744,096
1,066,830
Listed ordinary shares
Number of shares
Percentage of
ordinary shares
162,205,244
132,256,827
120,840,255
76,919,785
49,725,091
26,277,940
17,210,485
15,497,829
14,553,334
10,552,454
10,232,033
9,057,670
9,000,000
7,816,825
7,525,000
6,751,094
6,600,000
6,107,523
6,100,000
6,000,000
701,229,389
14.12
11.51
10.52
6.7
4.33
2.29
1.5
1.35
1.27
0.92
0.89
0.79
0.78
0.68
0.66
0.59
0.57
0.53
0.53
0.52
61.05
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Pancontinental Oil & Gas NL Annual Report 2012
Additional ASX Information
Additional ASX Information
Additional ASX Information
(d) Substantial Shareholders
(d) Substantial Shareholders
The details of substantial shareholders as disclosed in substantial shareholder notices received by the
The details of substantial shareholders as disclosed in substantial shareholder notices received by the
Number of Shares
Number of Shares
Company are set out below:
Company are set out below:
Sundowner International Limited, Indago Resources Limited and HSBC Custody Nominees
Sundowner International Limited, Indago Resources Limited and HSBC Custody Nominees
118,499,351
118,499,351
Roy Barry Rushworth and CM Skye Trustees Limited as trustee for the Mulberry Trust
Roy Barry Rushworth and CM Skye Trustees Limited as trustee for the Mulberry Trust
34,764,181
34,764,181
(e) Permit Schedule
(e) Permit Schedule
Permits and Licence Interests
Permits and Licence Interests
Petroleum prospects
Petroleum prospects
Western Australia
Western Australia
Western Australia
Kenya
Kenya
Kenya
Namibia
Namibia
Namibia
Permit reference
Permit reference
L15
L15
L15
EP 104 (R1)
EP 104 (R1)
EP 104 (R1)
EP 110
EP 110
EP 110
EP 424
EP 424
EP 424
L6
L6
L6
L8
L8
L10A
L8
L10B
EL 0037
L10A
L10A
L10B
L10B
EL 0037
EL 0037
Interest
Interest
12 %
12 %
12 %
10 %
10 %
10 %
38.462%
38.462%
38.462%
38.462%
38.462%
38.462%
40%
40%
40%
15%
15%
15%
15%
15%
95%
15%
15%
15%
15%
95%
95%
Pancontinental oil & Gas nl | Annual Report 2012
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Pancontinental Oil & Gas NL Annual Report 2012
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PANCONTINENTAL OIL & GA
S N
L –
A
N
N
U
A
L
R
E
P
O
R
T
2
0
1
2
288 Stirling Street
Perth WA 6000
Telephone: +61 8 9227 3220
Fax: +61 8 9227 3211