Restaurant Brands New Zealand Limited Annual Report 2023

FY2023 Annual Report · Restaurant Brands New Zealand Limited

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Delivering on our strategy to
unlock strategic gas assets to
secure European gas supply
and energy security.

Annual Report and Financial Statements
For the year ended 31 December 2023

Contents

Highlights

Chair’s letter

Strategic Report
Strategy and business model
Key performance indicators
Co-Chief Executive Officers’ Review of Operations
Financial Review
Principal Risks and Uncertainties
Environmental, Social & Governance
Section 172(1) statement

Corporate Governance
Board of Directors
Directors’ Report
Corporate governance report
Directors’ Remuneration Report
Statement of Directors’ responsibilities

Financial Statements
Independent Auditor’s Report
Primary Financial Statements
Notes to the Financial Statements

Other Information
Glossary
Corporate Information

4
5
7
10
12
15
18

22
24
25
31
34

35
40
46

77
78

Highlights

Reporting period ended 31 December 2023

Portfolio developments

Post Period End Highlights

Acquisition of a 26.1% interest in LNEnergy Limited
(“LNEnergy”), built in stages throughout 2023 for a total
consideration of £4.3m (£1.9 million of which was in
cash and the balance in 1,297,297,298 new Reabold
shares). LNEnergy’s primary asset is an exclusive option
over a 90% interest in the Colle Santo gas field, a highly
material gas resource with an estimated 65bcf of 2P
reserves, with two production wells already drilled and
a development-ready field, subject to approvals and
permits. Financing and approvals are progressing well
for the liquified natural gas (“LNG”) field development.

Balance sheet and capital allocation

Cash of £5.4 million as at 31 December 2023;
net assets of £42.2 million

Cash proceeds of £5.2 million received during the
financial year for second tranche proceeds from the sale
of Corallian

£263,000 returned to shareholders through share
buybacks as part of the distribution of Corallian sale
proceeds, with a further £75,000 returned post
period end.

Final tranche cash proceeds of £4.4 million for the
sale of Corallian, received from Shell in January 2024;
Reabold net cash of £8.2 million as at 30 April 2024

At West Newton, a Gas Export Feasibility study
completed by independent energy consultants,
CNG Services Limited, concluded that as a precursor
to the intended West Newton full field development, an
initial single well development and gas export plan can
accelerate production and cash flow whilst requiring
limited capital expenditure, giving the joint venture the
ability to drill future wells out of cash flow. See Review of
Operations section on page 7 for further details.

Execution of a non-binding Heads of Agreement between
Gunvor International B.V. (“Gunvor”) and LNEnergy for
the purchase of LNG by Gunvor from LNEnergy from the
Colle Santo gas field.

Reabold Resources Plc Financial statements for the year ended 31 December 2023Chair’s letter

Jeremy Edelman
Chair

In the financial year ended 31 December 2023, Reabold
continued with its strategy of identifying, investing in,
maturing and monetising undeveloped gas discoveries with
significant resources and near-term production potential.
Our emphasis is on investing in UK and European gas
assets to enhance domestic energy supply and security,
which has been exposed in recent years by the Ukraine war.
The sale of the Victory strategic gas project to Shell U.K.
Limited (“Shell”) in late 2022 reaffirmed our view that there
is further opportunity for value creation by applying our
strategy to similar assets. Portfolio activity undertaken in
2023 reflects this approach; Reabold reinvested some of the
proceeds from the Victory transaction into a significant new
opportunity in Italy, the Colle Santo onshore gas field, and
continued to commit resources to and develop the attractive
prospects of the PEDL183 onshore licence at West Newton
in the UK. Other investments in the Reabold portfolio,
such as the Romanian licences, continue to hold attractive
optional value in the long-term but were not a capital
allocation priority in 2023.

At West Newton, we were pleased to receive approval
permits from the Environment Agency, a key step
forward in enabling further licence activity. We were
however disappointed with the delay in drilling of the first
development well, which had been targeted for the second
half of 2023. Rathlin, the site operator, was unable to resolve
funding for its own share in 2023, which we believe is a
consequence of the fiscal and political instability in the
UK. With a strong balance sheet throughout the year and
£8.2 million of cash as at 30 April 2024, Reabold has more
than sufficient funding for its direct share of the planned
drilling on the licence. And having confirmed a materially
lower phased capital expenditure plan for a single well

development and early cash flow from production, ahead
of the full field development longer-term, we now look
forward to an enhanced level of interest and the resolution
of Rathlin’s funding situation in 2024 through a potential
farm-out arrangement or other sources of capital. As a
Board, we remain confident in the prospects for West
Newton and are fully focused on realising the asset’s
significant value potential for shareholders.

Outside the UK, we took the decision to build a significant
stake (26.1% by the end of 2023) in LNEnergy for a total
cost of £4.3 million (£1.9 million in cash and £2.4 million
via the issuance of 1,297,297,298 new ordinary shares).
We were attracted to LNEnergy because of the exclusive
option it has over a 90% interest in the Colle Santo gas
field, a highly material onshore gas resource in central Italy,
with two production wells already drilled and a field that
is development ready, subject to the approvals process.
The primary focus for this asset in 2023 was to progress
the necessary regional and national approvals required to
begin operations. We are encouraged by the favourable
momentum in this approvals process throughout 2023 and
into the current financial year, helped by the political desire
to improve domestic energy security. LNEnergy is working
towards securing all necessary permits in the near future.
It is also pleasing to report that LNEnergy has secured a
well-known, highly experienced technical partner, Italfluid,
to act as contract operator and, since the period end, has
signed a Heads of Agreement with Gunvor, a leading global
LNG trader, for the purchase of LNG from the Colle Santo
production facility. 2024 will be an important year in gaining
all the formal approvals and operationalising the site to start
producing first gas and generating early cash flow, currently
targeted for 2025.

Reabold Resources Plc Financial statements for the year ended 31 December 2023From a corporate and governance perspective, 2023
was a year of mixed fortunes and outcomes. The Board
and management team had to deal once again with the
unwelcome distraction of a second unsuccessful general
meeting requisition, driven by Kamran Sattar of Portillion
Capital. This consumed valuable time and resource from our
efforts to progress our two key assets in the UK and Italy, as
described above. With the cash proceeds from the Victory
asset sale on our balance sheet, we initiated a share buyback
programme – returning £263,000 to shareholders in 2023
and a further £75,000 post period end. Our net assets on
the balance sheet were £42.2 million, well above the market

capitalisation of the Company at the time of writing. It is now
our duty to ensure the full potential and value of Reabold’s
portfolio is delivered to shareholders. As a Board, we remain
confident that this can be achieved, and we look forward to
updating you on our progress throughout the year.

Jeremy Edelman
Chair

30 May 2024

Reabold Resources Plc Financial statements for the year ended 31 December 2023
We are focused on the disciplined allocation of capital to
deliver on our strategic objectives. Reabold’s current focus
is on its two key gas assets that have strong parallels with
Victory: West Newton (UK onshore) & Colle Santo (Italy
onshore). Similar to Victory, both assets are highly material,
undeveloped gas discoveries in Europe. Full details of these
operations are included in the Review of Operations.

Strategic Report

Strategy and business model

Reabold is an investing company focussed on developing
strategic European gas assets to secure European gas supply
and energy security. Reabold has a diversified portfolio
of gas assets comprised of development, appraisal and
exploration projects. Reabold aims to generate shareholder
value by making disciplined and focused investments to
grow our business. Reabold’s strategy is to invest in existing
undeveloped gas discoveries with significant resources and
near-term production potential, which have considerable
valuation uplift potential and a clear monetisation plan.
Proceeds from monetisation events are balanced between
shareholder returns and re-investment into new and
existing projects.

We are preparing for the future and responding to the
increased focus on energy security brought about by the
rise in geopolitical conflict and instability in the region, and
globally. Concern about energy shortages and vulnerability
to geopolitical events has prompted many governments to
prioritise access to more domestically produced energy and
reduce their dependency on imported gas. Reabold aims to
contribute to Europe’s energy security by unlocking potential
sources of near-term domestic gas supply, at a time when
the continent is exposed to potentially significant gas supply
disruptions. In this regard, the Company identified, matured
and sold the strategic Victory gas project in the UK to Shell
for £32.0m (£12.7m net to Reabold).

Reabold Resources Plc Financial statements for the year ended 31 December 2023Key performance indicators (KPIs)

The Group’s main business is to invest in direct and
indirect interests in exploration and development gas
projects. Reabold’s long-term strategy is to re-invest capital
generated through monetisation of its investments into
new projects in order to grow the Company and create
value for its shareholders. The Company tracks its new
business development objectives through the building of a

risk-balanced portfolio of assets. The Company reviews its
KPIs on an ongoing basis as it moves through the lifecycle
of its strategy to ensure they continue to serve as a useful
measure of our strategic performance.

The Board assesses the performance of the Group across
measures and indicators that are consistent with Reabold’s
strategy and investor proposition.

The KPIs are:

KPI

KPI 1

Definition

Performance

Portfolio enhancements

Grow value through material
investments, project delivery and
commercial discoveries

• Accumulated a 26.1% interest in LNEnergy in 2023 whose primary asset is an exclusive
option over a 90% interest in the Colle Santo gas field onshore Italy. The Colle Santo gas
field is a highly material gas resource with an estimated 65Bcf of 2P reserves, with two
production wells already drilled and flow-tested, making the field development ready.
LNEnergy believes that the field has the potential to generate an estimated €11-12m of
gross post-tax free cash flow per annum.

KPI 2

Future financial prosperity

Liquidity events, and successful
fundraising

• Reabold received £5.2 million in cash in 2023 which represented the second tranche
of the consideration from the Corallian disposal, following Shell’s decision to continue
to pursue the development of the Victory gas field. A further £4.4 million was received
in January 2024.

KPI 3

Financial discipline

Ensuring business is run to budget
via accurate forecasting, maintaining
significant cash buffer and resilient
balance sheet

• Cash position as at 31 December 2023 was £5.4 million (£8.2 million at 30 April

2024). Reabold is fully funded for all intended activities and commitments in 2024.

• Net assets as at 31 December 2023 were £42.2 million.

KPI 4

KPI 5

Growth in NAV per share

• Broker risked NAV remains unchanged at 1.2p/sh

Total shareholder return over a
calendar year

• The share price started the year at 0.21p and finished the year at 0.11p

KPI 6

Risk and controls

Zero recordable incidents, ethical
misconduct, breaches of laws or
regulations, penalties. Accurate and
compliant financial resources data

• The Company did not have any recordable incidents or injuries in 2023. There were
no instances of misconduct, breaches of laws or regulations, regulatory actions or
penalties. The Company was compliant with all its financial reporting deadlines.

Reabold Resources Plc Financial statements for the year ended 31 December 2023Strategic ReportWellheads at Colle Santo

Reabold Resources Plc Financial statements for the year ended 31 December 2023Sachin Oza
Co-Chief Executive Officer

Stephen Williams
Co-Chief Executive Officer

Co-Chief Executive Officers’ Review
of Operations

In 2023, it became even clearer that Europe needs a
secure, affordable and lower carbon energy system.
The Russia-Ukraine war continued in 2023 and renewed
conflict in the Middle East has raised political tensions.
Reabold’s strategy is to improve Europe’s energy security
by unlocking potential sources of near-term domestic gas
supply, at a time when Europe is exposed to potentially
significant gas supply disruptions. In this regard, the
Company identified, matured and sold the strategic Victory
gas project to Shell for £32.0m (£12.7m net to Reabold).

The last few years were about generating options. In 2024,
and as we drive to 2025, we will focus on our two key
gas assets that have strong parallels with Victory, namely
West Newton in the UK and Colle Santo in Italy, where
the Company plans to apply the same successful strategy
demonstrated with Victory. We will discuss the details of
each project below.

UK Onshore

Rathlin Energy (UK) Limited and West Newton -
PEDL183

West Newton is an onshore hydrocarbon discovery located
north of Hull, England. To date, three successful wells have
been drilled at West Newton (A-1, A-2 and B-1z) confirming
a major discovery - potentially one of the largest hydrocarbon
fields discovered onshore UK. Rathlin Energy (UK) Limited
(“Rathlin”) is the operator of the licence in which it holds
a 66.67% interest. Reabold has a 59.5% shareholding in
Rathlin and a direct 16.67% interest in the licence, giving
the Company an aggregate c. 56% economic interest in West
Newton. The other co-venturer on the licence is Union Jack
Oil with a 16.67% direct interest.

A Gas Export Feasibility study completed by CNG
Services Limited in the first half of 2024, concludes that,
as a precursor to the intended West Newton full field
development, an initial single well development and gas
export plan can accelerate production and cash flow whilst
requiring limited capital expenditure. With the industry
currently suffering from a lack of available development
capital, the ability to achieve early production with limited
capex is strategically extremely valuable. Initial gas

production will be from a single horizontal well, processed
through a modular plant, tied in from the A site to the
National Transmission System at an existing above ground
installation via a pipeline. The single well development plan
benefits from early cash generation with the ability to drill
future wells out of cash flow. Drilling of the next well at West
Newton is subject to Rathlin funding and regulatory approval.
Following drilling and testing of this horizontal well, first gas
is expected 18 months later with an associated development
capex estimated to be c.£12 million. Although early
production from the single well development demonstrates
highly attractive standalone economics and would support
future wells being drilled from cashflow, it is envisaged
that it will be a precursor to the full field conceptual
development plan which had an associated pre-tax NPV(10)
of US$222 million, net to Reabold, based on the PEDL183
CPR effective 30 June 2022.

In May 2024, Reabold commissioned GaffneyCline to
perform a carbon intensity study for the West Newton field.
The GaffneyCline study highlighted the following:

•

The West Newton project has an AA rating for Carbon
Intensity for its potential upstream gas and condensate
production, the lowest possible carbon intensity rating
category on GaffneyCline’s scale

The West Newton field has a Carbon Intensity
significantly lower than the UK average and onshore and
offshore analogues. It is also significantly lower than
the average imported LNG, based on the NSTA Natural
Carbon Footprint Analysis published in July 2023

Based on the study, GaffneyCline estimates that West
Newton could produce the equivalent of just 2.87 grams
of CO2 per megajoule of energy developed (gCO2eq./MJ)

As the development proceeds and project knowledge
increases, there is potential to improve the Carbon
Intensity by further reducing fugitive, flaring and venting
emissions and by gas-to-grid development, reducing
on site gas and condensate processing, and using the
shortest possible route to the National Grid

The AA rating demonstrates the low carbon credentials of the
West Newton project and is an example of the opportunities
available in the UK to power the country through lower
carbon, home grown energy, rather than relying on expensive
and more carbon intensive imports. For more information,
please see the ESG section of this report on pages 15-17.

Reabold Resources Plc Financial statements for the year ended 31 December 2023Strategic ReportThe joint venture has a commitment to the North Sea
Transition Authority (“NSTA”) to drill and test a new Kirkham
Abbey deviated or horizontal well by June 2024 and to
recomplete or sidetrack and test one of the existing wells
in that same timeframe. As mentioned above, drilling of the
first development well is subject to Rathlin securing funding.
There is an active process underway to assess options to
source funding for Rathlin’s share of the cost, including
through a farmout, or through further investment from
Reabold, which, following the receipt of the proceeds from
Shell, the Company could potentially provide, in addition
to funding its own share. As a result of Rathlin’s funding
shortfall, drilling of the first development well will not be
completed prior to June 2024. Rathlin, as operator, has
initiated discussions with the NSTA to defer the deadlines for
these commitments.

Italy – LNEnergy

Colle Santo Gas Field

In May 2023, Reabold acquired a 3.1% interest in LNEnergy
for cash consideration of £250,000 and received options
to acquire, at its sole discretion, further shares in LNEnergy.
In June 2023, Reabold exercised certain of these options
to increase the Company’s stake in LNEnergy to 16.2%
through a cash consideration of £500,000 and the issuance
of 810,810,811 new ordinary shares as consideration for
the increased investment. In September 2023, Reabold
increased its stake in LNEnergy to 17.6% for a further cash
consideration of £250,000. In November 2023, Reabold
increased its interest in LNENergy by 0.8% to 18.4%
through a partial exercise of the remaining option for a cash
consideration of £150,000. In December 2023, Reabold
exercised the remainder of the final option to increase its
stake in LNEnergy to 26.1% through a cash consideration of
£750,000 and the issuance of 486,486,487 new ordinary
shares as consideration for the increased investment.

LNEnergy’s primary asset is an exclusive option over a
90% interest in the onshore Colle Santo gas field in Abruzzo,
Italy. With 65bcf of 2P reserves, as estimated by RPS as of
30 September 2022, this is a highly material undeveloped
onshore gas resource. Reabold believes this is the largest
onshore proven undeveloped gas field in mainland Western
Europe. The field is development ready subject to permits
and approvals. Two wells have already been drilled and are
available for production, with no additional drilling being
required. The development will consist of a small-scale LNG
facility to produce initially at 10mmcf/d from the existing two
wells with over 20 years of ultimate production. LNEnergy

believes that the field has the potential to generate an
estimated €11-12m of gross post-tax free cash flow per
annum. First gas is targeted for 2025.

Demand for LNG is expected to continue to grow. LNG is
critical to the energy transition and plays an important role in
enabling countries to replace coal-fired power generation with
a less carbon-intensive alternative, and provides grid stability
alongside wind and solar power in electricity generation. The
Italian government has recently approved a decree, which was
converted into law in February 2024, to boost the country’s
renewable energy production and energy security. The decree
provides incentives to build plants for energy production from
renewable sources, such as the liquefaction of natural gas; the
release of new licences for the exploitation of gas fields aimed
at providing gas to industries with high gas consumption,
at competitive prices; incentives for LNG terminals and
incentives for carbon dioxide storage programmes.

In August 2023, Reabold announced that LNEnergy had
received a letter from the head of the Italian National
Bureau of Hydrocarbons and Georesources (“UNMIG”),
the minerals division of Italian Ministry of Environment and
Energy Security (“MASE”), giving permission to carry out well
integrity and well service testing on the two existing wells
and to start work on the installation and commissioning of
the monitoring network at the Colle Santo gas field. The letter
is a positive indication of support for the development of the
Colle Santo gas field and the next stage is to receive a formal
decree from MASE to conduct the work.

In December 2023, LNEnergy reported that it had filed the
Environmental Impact Study (“EIS”) for the new small-scale
LNG development plan at the Colle Santo gas field with
MASE. This is a further step towards achieving the granting
of a production concession at Colle Santo. The study was
performed on behalf of LNEnergy by its technical partner
Italfluid, and various subsidiary companies of Italfluid, along
with several independent technical specialists.

The Company also notes that LNEnergy’s application for
concession has been recognised by MASE, as a project that
meets the requirements of the Italian government’s National
Integrated Plan for Energy and Climate and National Plan
for Economic Recovery, for which €12 billion in grants
and economic incentives have been made available by
executive decree.

On 2 May 2024, Reabold announced the execution of a
non-binding Heads of Agreement (“HoA”) between Gunvor
and LNEnergy for the purchase of LNG by Gunvor from
LNEnergy from the Colle Santo gas field. The HoA provides

Reabold Resources Plc Financial statements for the year ended 31 December 2023Romania – Danube Petroleum Limited

Reabold has a 50.8% equity position in Danube Petroleum
Limited (“Danube”), with ASX listed ADX Energy Ltd (“ADX”)
holding the remaining 49.2%. Danube has a 100% interest
in the Parta exploration and Iecea Mare production licence in
Western Romania, which include the IMIC-1 discovery and
the IMIC-2 prospect.

During the reporting period, following several positive
meetings with the governing authority, ADX has submitted
technical and financial documents in relation to the Parta
Exploration Licence to the relevant Romanian authorities for
the possible extension of the current licence period (note:
the validity of the Iecea Mare production licence is 20 years
and not affected). The governing authority is the National
Agency for Mineral Resources (NAMR) which is supporting
the extension which can be granted through a government
process. ADX is currently providing several reports to assist
NAMR with documenting the extensive past activity with the
objective of receiving a de facto waiver on the fulfilment of
the obligatory work programme.

With regards to the Iecea Mare Production Licence, ADX has
forwarded the 2024 work programme to the government
agency and is reviewing options to convert part of the licence
into a geothermal prospecting area.

USA – Daybreak

Reabold has a 42% shareholding in Daybreak Oil and Gas
Inc (“Daybreak”). Daybreak is an OTC traded oil and gas
company engaged in the exploration, development and
production of onshore crude oil and natural gas, primarily in
California. Further details on Daybreak can be found on its
website at www.daybreakoilandgas.com/.

Sachin Oza
Co-Chief Executive
Officer

30 May 2024

Stephen Williams
Co-Chief Executive
Officer

the terms on which Gunvor will purchase LNG from LNEnergy
at its planned small-scale LNG production facility at the Colle
Santo gas field. Gunvor will purchase approximately 44,000
tonnes of LNG per annum. The point of sale will be the truck
loading flange at the small-scale LNG plant, and the LNG will
then be delivered by truck in Italy. The price for the LNG will
be aligned with the Italian PSV price. The contract term will
be for an indefinite period with a minimum term of five years.

The HoA also provides for a potential prepayment by
Gunvor for a portion of the first five years of deliveries,
with such amounts subject to prepayment being a total of
approximately 66,000 tonnes of LNG, or 999,000 MWh.
The average forward Italian PSV gas price for the years
2025-2030 is currently approximately €30 / MWh. The
prepayment is conditional on agreeing definitive transaction
documentation and LNEnergy obtaining the required permits
to construct and operate the LNG production facility.

On the basis of the HoA, LNEnergy and Gunvor intend to
negotiate a fully-termed LNG sale and purchase agreement
over the next six months. During such time, LNEnergy will
exclusively discuss the sale and purchase of LNG from Colle
Santo with Gunvor, whilst concurrently focusing its efforts on
obtaining the required permits to construct and operate the
LNG production facility.

UK Offshore

Victory contingent consideration receivable

Following the receipt of the initial £3.2 million net to Reabold
in November 2022, for the sale of Corallian, Reabold
received a further £5.2 million in December 2023. In January
2024, Reabold received the final tranche payment, following
Shell’s receipt of development and production consent for
the Victory gas field from the North Sea Transition Authority,
taking Reabold’s final proceeds for the sale of its 49.99%
interest in Corallian to £12.7 million.

Licences retained - P2605, P2504 (both 100%) and
P2486 (10%)

In 2023, Reabold relinquished interests in five North Sea
licences: (P2464 and P2493 (both 100%), P2332 (30%),
P2329 and P2427 (10%)). Reabold relinquished its
36% interest in licence P2478 in March 2024.

Discussions to farm down Reabold’s remaining North Sea
licences to help fund the de-risking and value creation
process continues, however, the energy profits levy and
political uncertainty in the UK has created difficulties for the
farmout process.

Reabold Resources Plc Financial statements for the year ended 31 December 2023Strategic ReportFinancial Review

Group Income Statement

The Group’s loss for the year ended 31 December 2023 was
£7.2 million (2022: £45,000).

The Group incurred a loss of £2.7 million on financial assets
(2022: £1.9 million) The loss primarily arose from a decline
in the market value of Daybreak’s shares (£3.5 million),
partly offset by an increase in the fair value of contingent
consideration receivable (£0.8 million) from the sale of
Corallian in 2022.

Reabold’s share of loss of associates was £0.6 million (2022:
£1.6 million). The decrease was largely due to the absence of
non-cash impairment charges which Corallian had incurred
in 2022. See Note 15 for more information.

Reabold received cash proceeds of £5.2 million in 2023
related to the sale of Corallian to Shell in 2022, however
the gain on this sale was recorded in 2022, when the sale
completed, and as such no gains were recorded in the
income statement in 2023. In 2022, the net gains on sale
of businesses of £5.0 million related to the gain on sale
of Corallian (£7.3 million) offset by a loss on disposal of
Reabold California (£2.3 million).

Exploration expenses of £1.6 million were incurred in 2023
(2022: £74,000). The increase in 2023 was principally
related to exploration expenditure written off as a result
of the relinquishment of several North Sea licences.
See Notes 7 and 13 for further details.

Administrative expenses for the year were £2.2 million
(2022: £1.7 million). The increase was mainly driven by an
increase in legal fees in relation to the step acquisitions of
LNEnergy, as well as inflationary impacts across the majority
of suppliers.

In 2023, Reabold incurred £190,000 (2022: £191,000)
in legal and professional fees, which Rebold has classified
as non-underlying items, in relation to the successful
defence from a second attempt, from a group of beneficial
shareholders, to remove the entire Board of Directors of
Reabold and replace them with four new directors. All
resolutions proposed by the requisitioning shareholders were
rejected at a general meeting held in January 2024 (2022:
rejected at a general meeting held in November 2022).

Group Balance Sheet

Exploration and evaluation assets increased by £0.2 million
from £6.8 million at 31 December 2022 to £7.0 million
at 31 December 2023. Additions at West Newton of
£0.3 million and the acquisition of four Southern North
Sea licences for £1.2 million as part of the acquisition of
Simwell Resources were offset by exploration write-offs of
£1.4 million.

Investments in associates increased from £22.3 million at
year end 2022 to £26.1 million at year end 2023, primarily
as a result of the step acquisitions of LNEnergy during the
year. See Note 15 for further information.

Other long-term investments decreased by £3.5 million
as a result of the decline in value of Daybreak’s shares.
Other short-term investments decreased from £8.7 million
to £4.4 million following the receipt of £5.2 million of
contingent consideration for the sale of Corallian to Shell
in 2022. The movement in short-term investments also
included favourable movements of £0.8 million due to
the fair value accounting of contingent consideration.
See Note 16 for further information.

The increase in share capital from £9.0 million to
£10.6 million arose from shares issued as consideration for
the acquisition of Simwell Resources Limited (£0.2 million)
and shares issued as part of the investment into LNEnergy
(£1.3 million). The decrease in the share premium account
from £29.0 million to £1.1 million relates to a capital
reduction of £29.4 million, offset by the premium on shares
issued as part of the consideration for Simwell Resources
Limited (£0.4 million) and the premium on shares issued as
part of the investment in LNEnergy (£1.1 million). The capital
reduction ensures the Company has sufficient distributable
reserves to make distributions to shareholders.

Overall, net assets decreased from £46.5 million at
31 December 2022 to £42.2 million at 31 December 2023.

Group cash flow statement

Net cash used in operating activities was £2.2 million
in 2023, compared with £1.8 million in 2022. The net
cash used in operating activities was primarily driven by
administration expenses of £2.2 million.

Cash flow from investing activities was an inflow of
£2.3 million, compared with an inflow of £2.4 million in

Reabold Resources Plc Financial statements for the year ended 31 December 2023PEDL 183

The joint operation between Rathlin, Reabold and Union Jack
have a commitment to drill and test a new Kirkham Abbey
deviated or horizontal appraisal well by June 2024. The joint
venture has also committed to recomplete or sidetrack and
test one of the WNA-1, WNA-2 or WNB-1Z wells in that
same timeframe. The Company estimates its 16.67% share
of costs for these commitments to be c.£2.2 million. Rathlin,
the operator of PEDL183, is working with the NSTA to defer
these commitments to allow the time necessary for Rathlin to
obtain sufficient funding for its share of the commitments.

UK North Sea

Reabold estimates its share of firm exploration and appraisal
work commitments on its North Sea portfolio to be
c.£50,000 over the course of 2024. The Company has not
yet taken a decision on whether to drill on any of its North
Sea licences.

2022. The cash flow from investing activities in 2023
included cash capital expenditure of £2.9 million (compared
with cash capital expenditure of £0.7 million in 2022). The
increase in cash capital expenditure was primarily driven by
the acquisition of Simwell Resources Limited and the step
acquisitions of LNEnergy. Divestment proceeds in 2023
were £5.2 million compared with £3.2 million in 2022 – both
amounts relate to cash receipts from the sale of Corallian to
Shell in 2022.

Cash flow from financing activities in 2023 was an outflow
of £0.3 million, compared with nil in 2022, due to the
repurchase of shares in 2023.

Liquidity

Cash and cash equivalents were £5.4 million at
31 December 2023 (2022: £5.5 million). The Group has
no debt.

Commitments

The Group does not have any signed contractual capital
commitments as at 31 December 2023 (2022: nil), however
the group does have obligations to carry out defined work
programmes on its licences, under the terms of the award of
rights to these licences. The Company is not obliged to meet
other joint venture partner shares of these programmes.

Reabold Resources Plc Financial statements for the year ended 31 December 2023Strategic ReportPrincipal Risks and Uncertainties

Reabold operates in an environment subject to inherent risks and uncertainties. The Board regularly considers the principal
risks to which the Group is exposed and monitors any agreed mitigating actions. The overall strategy for the protection of
shareholder value against these risks is to carry a broad portfolio of assets with varied risk/reward profiles, and to retain
adequate working capital. The risks faced by the Company can, and are likely to, change with progress in the Company’s
strategy and developments in the external business environment.

The risks discussed below, separately or in combination, could have a material adverse effect on the implementation of our
strategy, our business, financial performance, liquidity, prospects, shareholder value and returns and reputation.

Risks

Mitigation

•

Management regularly communicates its strategy to shareholders.

Focus is placed on building a diverse and resilient asset portfolio capable of offering
prospectivity throughout the business cycle. The Group continually reviews its
portfolio of assets to identify internal growth opportunities.

The Company seeks to limit its financial dependence on any one single asset by
holding a diversified portfolio and re-investing capital generated through monetisation
of its investments into new projects in order to grow the Company and create value
for its shareholders.

The Group engages with a range of advisers and active competitor monitoring to
provide a range of opportunities for screening.

The Group also engages third-party assurance experts to review, challenge and,
where appropriate, make recommendations to improve the processes for project
management, cost control and governance of projects.

The Directors regularly monitor the appropriateness of the strategy taking into
account both internal and external factors, and the progress in implementing the
strategy, and may modify the strategy based on developments.

Contingency is built into the evaluation, planning and budgeting process to allow for the
downside movements in commodity prices.

Reabold’s business model is to invest in undervalued oil and gas assets that would be
able to deliver profitably under current reasonable oil/gas price assumptions, are at the
lower end of the industry cost curve and will be competitive against other sources of
hydrocarbons.

The Group and its investee companies undertake extensive analysis of available
technical information to determine work programmes.

Appraisal programmes are designed to de-risk the overall field development. Well
and seismic data is continually reviewed to best allocate capital and make drilling
decisions.

• Downside risk can be reduced by entering into risk sharing arrangements.

•

The Group retains working capital reserves to cover any delays or cost overruns.

Strategic, Commercial and Operational Risks

Investment Returns: Stock market support
may be eroded, lowering investor appetite and
obstructing fundraising if we fail to scale our
business at pace, make poor investment choices
or fail to sustain and develop a high-quality
portfolio of assets.

Prices and Markets: Decreases in oil and/or
gas prices could have an adverse effect on the
demand for oil and/or gas. If these reductions
are significant or for a prolonged period, we
may have to write down assets and investments
and reassess the viability of certain projects,
which may impact future cash flows, profit,
capital expenditure, the ability to work within
our financial frame and maintain our investment
programme.

Accessing, progressing and delivering
hydrocarbon projects: Inability to access
and progress hydrocarbon resources could
adversely affect delivery of our strategy.
Challenging operational environments and
other uncertainties could impact drilling and
production activities. Challenges include
uncertain geology; the existence and availability
of necessary technology and engineering
resources; the availability of skilled labour; the
existence of transport infrastructure; project
delays; the expiration of licences; delays in
obtaining required permits; potential cost
overruns; and technical, fiscal, regulatory,
political and other conditions.

Reabold Resources Plc Financial statements for the year ended 31 December 2023Risks

Mitigation

Liquidity, financial capacity and financial
exposure: External market conditions can
impact our financial performance. Insufficient
liquidity and funding capacity of the Group and
its investee companies could adversely impact
the implementation of the Group’s strategy and
restrict work programmes due to lack of capital.

Joint arrangements: Most of our projects and
operations are conducted in joint arrangements
or with associates. This could reduce our degree
of control and our ability to identify and manage
risks. Varying levels of control over the standards,
operations and compliance of our partners could
result in legal liability and reputational damage.

Climate change: A global transition to alternative
energy sources could have an adverse impact
on demand for oil and gas, commodity prices
and/or the Group’s access to and cost of
capital. Developments in policy, law, regulation,
technology and markets including societal and
investor sentiment, related to the issue of climate
change and the transition to a lower carbon
economy could increase costs, constrain our
operations and affect our business plans and
financial performance.

Talent and capability: Inability to attract,
develop and retain people with necessary skills
and capabilities could negatively impact delivery
of our strategy.

Geopolitical: Exposure to a range of political
developments and consequent changes to the
operating and regulatory environment (including
events relating to the Russia-Ukraine conflict)
could cause business disruption.

Digital infrastructure, cyber security and data
protection: Breach or failure of our third parties’
digital infrastructure or cyber security, including
loss or misuse of sensitive information could
damage our operations, increase costs and
damage our reputation.

•

Management has a clear strategy for value realisation and creation as evidenced by
the realisation of value from the Corallian sale in 2022.

The Group maintains a strong balance sheet by maximising cash to ensure sufficient
liquidity within the business. The Group has no debt.

Cash forecasts are monitored including considering multiple scenarios.

The Company has demonstrated it can raise incremental capital if needed.

The Group continually monitors its capital allocation and will only pursue programs
that are of appropriate size and risk relative to the Group’s capital resources.

For every project which is conducted via an associate, Reabold seeks to appoint a
director to the board of the associate, whose responsibility is to manage performance
and create and protect value for Reabold. With a director on the board, Reabold seeks
to influence operators and other partners to adapt their practices in order to drive
value appropriately and to mitigate identified risks.

The Group continually engages with its operating partners and closely monitors the
operation of its assets.

The Group completes thorough due diligence reviews before entering future
partnerships to ensure that their strategic and operational objectives are aligned with
those of the Group.

Management looks for opportunities to deliver low carbon intensity production into
the UK market by using low carbon intensity facilities, including potential re-use of
existing infrastructure.

The Group’s “investment horizon” is considered to fall within time frames too short to
be materially affected by the Paris Agreement 2˚C scenario.

The Group’s resources are weighted towards gas which is playing a key role in the
national energy transition.

Recruitment and retention of key staff through providing competitive remuneration
packages and stimulating and safe working environment. Balancing salary with longer
term incentive plans.

• We continually monitor geopolitical developments.

• Management maintains regular communication with regulatory authorities.

•

The Company aligns its standards and objectives with government policies as closely
as possible.

The Group does not consider that it has a material adverse exposure to the
geopolitical situation with respect to the sanctions imposed on Russia, although
recognises the evolving situation is causing price volatility. The Group will continue to
monitor its position to ensure it remains compliant with any sanctions in place.

The Group employs specialist support to detect and monitor threats using security
protection tools.

We build awareness with our employees and share information for continuous
learning.

Reabold Resources Plc Financial statements for the year ended 31 December 2023Strategic ReportRisks

Mitigation

Compliance and control risks

Regulation: Changes in the law and regulation
in countries in which Reabold has a presence
with partners could increase costs, constrain
our operations and affect our strategy, business
plans and financial performance.

•

Our business seeks to identify, assess and manage legal and regulatory risk relevant
to our operations, strategy, business plans and financial performance. To support this
work, we seek to develop co-operative relationships with governmental authorities to
allow appropriate focus on areas of potential risk or uncertainty while also protecting
Reabold’s interests within the law.

Tax rates, particularly those applied to
hydrocarbon activities tend to be high compared
with those imposed on similar commercial
activities. Governments may change their
fiscal and regulatory frameworks in response
to public pressure on finances resulting in
increased amounts payable to them. The UKCS
licensing regime under which some of Reabold’s
operational rights and obligations are defined
may be subject to future change.

Reporting: Failure to accurately report our data
could lead to regulatory action, legal liability and
reputational damage.

•

Management will utilise investment incentives where available.

•

Our finance team provide assurance of the control environment and are accountable
for building control and compliance into finance processes and digital systems.

Reabold Resources Plc Financial statements for the year ended 31 December 2023Environmental,
Social & Governance

Environmental, Social and Governance (ESG)
Statement

Reabold is committed to the highest standards of
environmental, social and governance processes and we
incorporate these responsibilities into our operational
decision-making and investments. We regularly review our
approach, policies, and processes across key areas.

At present Reabold does not ‘operate’ any of the assets in
its portfolio. Our operational assets are managed by our
associate companies who are responsible for the adequacy
of standards, operations and compliance. The Group does
not have any assets that are yet in the development or
production stage and therefore the business has no scope 1
or scope 2 greenhouse gas emissions.

Environment

Reabold is committed to preserving and protecting
our natural environment for future generations.

Reabold complies with the standards of the international oil
industry, environmental laws and regulations. We recognise
and support the basis of the Paris Agreement to strengthen
the global response to the threat of climate change.

We support a balanced energy transition where the world
maintains a secure and affordable supply of energy, while
building the clean energy system of the future. Our focus
is on minimising carbon emissions and the environmental
footprint of the projects we invest in, whilst continuing to
contribute positively to the demand for energy and products
that require hydrocarbons in the supply chain. The pace
of transition to a lower carbon economy and cleaner fuels
is uncertain, and will be heavily influenced by government
policy, but oil and natural gas demand is expected to remain
a key element of the energy mix for many years based on
stated government policies, commitments and announced
pledges to reduce emissions. The challenge is to meet the
world’s energy needs sustainably and efficiently, which
requires managing and reducing harmful emissions.

Reabold actively encourages and expects its investee
companies / operators of its oil and gas interests to respond
to this by continuously striving to minimise the potential
environmental impact of operations by:

•

Implementing controls to identify and prevent potential
environmental risks

Implementing controls during operations to avoid
accidental spills, or leaks of polluting materials

• Managing water with due consideration

•

Targeting high energy efficiency levels in drilling and other
activities

Limiting unnecessary wastage

Handling waste products in an environmentally
responsible manner

Regularly assessing the environmental consequences of
operations

The operators have developed systems, controls and
processes to integrate climate related considerations,
in order to meet these objectives. For example one can
read the approach and policies of Rathlin Energy, operator
of the West Newton PEDL 183 licence, on its website
at www.rathlin-energy.co.uk, and of LNEnergy, operator
of the Colle Santo project in Italy, on its website at
https://www.sviluppocollesanto.it/.

Focus on energy efficient extraction and
drilling to reduce carbon intensity

Reabold’s assets are primarily small to medium sized,
proven oil and gas fields at relatively shallow depth. As
such, the intensity of drilling required is considered low
relative to industry standards and we do not conduct energy
intensive prospecting activities, reducing the impact on the
environment. We encourage the operators of our assets to
use the most energy efficient drilling methods. As the energy
mix evolves towards a higher percentage of renewables in the
countries in which we operate, we anticipate a greater share
of our energy consumption will be purchased from green
sources.

United Kingdom

Our investee company sites in the United Kingdom are
located close to areas with a high demand for energy.
Consequently, we expect that hydrocarbons produced
locally and consumed locally will displace imported
hydrocarbons thereby resulting in lower carbon emissions
overall. This will provide greater security of supply to the
UK as well as providing jobs and supporting UK industry,
compared to the alternative of importing fuel. The COVID-19
pandemic highlighted the importance of our critical national
infrastructure and, more recently, the war in Ukraine has
been a stark reminder that energy security cannot be taken
for granted.

We believe that natural gas has an important role to play in the
energy transition, bridging the gap on the journey from fossil

Reabold Resources Plc Financial statements for the year ended 31 December 2023Strategic Reportfuels to a renewable, zero-carbon future and helping to supply
stable and affordable energy to UK homes and businesses
as part of a lower-carbon energy supply mix. To that end, we
continue to explore ways to invest in gas projects such as
the Victory project, which was subsequently sold to Shell in
November 2022, and the Colle Santo gas project in Italy.

Reabold takes its commitment to responsible hydrocarbon
production very seriously. In May 2024, Reabold
commissioned GaffneyCline to perform a carbon intensity
study for the West Newton field. The GaffneyCline study
highlighted the following:

•

The West Newton project has an AA rating for Carbon
Intensity for its potential upstream gas and condensate
production, the lowest possible carbon intensity rating
category on GaffneyCline’s scale

Based on the study, GaffneyCline estimates that West
Newton could produce the equivalent of just 2.87 grams
of CO2 per megajoule of energy developed (gCO2eq./MJ)

We believe West Newton is an important strategic asset
to the UK as the country looks to secure domestic energy
supply for secure and affordable energy, at a time when
the country is exposed to potentially significant gas supply
disruptions. The study proves that the operator, Rathlin,
is a responsible hydrocarbon producer complying with
best environmental practice to produce much needed UK
hydrocarbons in the most efficient and environmentally
friendly way possible.

Reabold is committed to the highest standards of
environmental processes and we incorporate these
responsibilities into our operational decision-making and
investments.

Italy

The development plan for Colle Santo involves converting
gas to LNG directly onsite using a small modular LNG
processing unit. The LNG will be trucked a short distance
(7 km) to an entry point into the SNAM transmission grid.
There will be no new drilling due to two existing wells already
drilled and tested. There will be on-site CO2 capture of 1,400
tonnes CO2 equivalent per year, and connected hydrogen
production facilities.

LNG provides energy security and flexibility because it can
be easily transported to places where it is needed most.
LNG is a critical fuel in the energy transition and plays an
important role as a lower-carbon alternative to coal for
industry, and provides grid stability alongside wind and solar
power in electricity generation. It is the lowest-carbon fossil
fuel, producing around 50% less carbon emissions than coal
when used to generate electricity.

Daybreak, USA

Daybreak’s production sites are located in California, a state
with very high renewable energy generation which feeds into
the energy required for hydrocarbon extraction. By industry
standards, Daybreak’s oil and gas activities require a very low
level of energy to extract the hydrocarbons, ensuring it is one
of the most energy efficient of its type in California.

Romania

Romania has a diverse energy mix, including coal, natural
gas, nuclear, hydroelectric, and renewable sources. The
largest share of electricity production historically came from
coal and natural gas, followed by hydroelectric and nuclear
power. In recent years, there has been a shift towards
increasing the share of renewable energy sources, such as
wind and solar. However, Romania supports natural gas
in the long-term in the European Green Deal because it
forecasts that this resource will remain an important tool
in changing the energy sector and transitioning to a more
sustainable and carbon-free economy. By developing and
producing gas from the Parta site, Danube Petroleum
Limited will be able to contribute to the country’s efforts
to implement this energy strategy. In addition, options to
exploit the geothermal potential of the Romanian part of the
Pannonian Basin are under investigation with the authorities
in combination with a subsurface review of the likely
prospectivity.

Managing our environmental footprint and reducing our
emissions are important objectives for Reabold Resources.
We regularly review and revise our policies, as necessary.

Reabold Resources Plc Financial statements for the year ended 31 December 2023Health & Safety

Reabold wishes to build value through developing
sustainable relationships with partners and the
community.

We comply with all applicable legislation; and design
and manage our activities to prevent pollution, minimize
environmental and health impact and provide workplaces
free of safety hazards.

The Company is committed to high standards of health,
safety and environmental protection; these aspects
command equal prominence with other business
considerations in the decision-making process.

Health, safety and environmental protection are
responsibilities shared by everyone working for the Company
and the full support of all staff, partners and contractors
is vital to the successful implementation of the policy. We
ensure, as far as reasonably practicable, that all personnel
are aware of their delegated health, safety and environmental
responsibilities and are properly trained to undertake these.

We strive for continuous improvement in our HSE
performance and measure this by setting objectives and
targets consistent with the aims of this policy.

HSE performance is routinely monitored and reported
regularly to the Board of Directors, which will ensure that the
necessary resources are provided to support this policy fully.

Governance

As an AIM-quoted company, Reabold is required to apply a
recognised corporate governance code, demonstrating how
the Company complies with such corporate governance code
and where it departs from it.

The Directors of the Company have formally applied the
2018 QCA Code. The Board recognises the principles
of the 2018 QCA Code, which focus on the creation of
medium to long-term value for shareholders without stifling
the entrepreneurial spirit in which small to medium sized
companies, such as Reabold, have been created. Please
see pages 25 to 30 for the Chair’s corporate governance
statement and how Reabold has applied the 10 principles of
the 2018 QCA code.

Reabold Resources Plc Financial statements for the year ended 31 December 2023Strategic ReportSection 172(1) statement

In accordance with the requirements of Section 172 of the
Companies Act 2006, the Directors consider that, during
the financial year ended 31 December 2023, they have
acted in a way that they consider, in good faith, would most
likely promote the success of the Company for the benefit
of the members as a whole, having regard to the likely
consequences of any decision in the long term and the
broader interests of other stakeholders, as required by the
Act. The Board delegates day-to-day management of the
business of the Company to the Co-CEOs, save for those
matters which are reserved for the Board’s approval. More
information on how the Board has regard to the Section 172
factors are outlined below.

S172(1) (a) “The likely consequences of any
decision in the long term”

The Directors understand the business and both the evolving
and challenging environment in which we operate, including
the challenges of the global energy transition. The Board
made decisions with regard to acquisitions and investments
with consideration given to key stakeholders and the likely
long-term impact of any decision. During the year, the
Board reflected on the challenges to be faced by Reabold
given the shifting macroeconomic and geopolitical context.
Our strategy is intended to transition Reabold to an energy
business focused on developing strategic European gas
assets to secure European gas supply and energy security.
The Board of Directors is collectively responsible for the
decisions made towards the long-term success of the
Company and the way in which the strategic, operational
and risk management decisions have been implemented
throughout the business is detailed in our Strategy and
business model on page 4 and throughout the Strategic
Report.

S172(1) (b) “The interests of the Company’s
employees”

Reabold employees are fundamental and core to our
business model and the delivery of our strategic ambitions.
The future success of our business depends on attracting,
retaining, developing and motivating talented employees.

We ensure that:

•

Health, Safety and the Environment are considered
paramount throughout the organisation.

Annual pay and benefit reviews are carried out to
determine whether all levels of employees are benefitting
fairly and to retain and encourage skills vital for the
business.

•

There are freely available Company policies and
procedures.

Personal development reviews and work appraisals are
conducted.

Employees are informed of the results and important
business decisions and are encouraged to feel engaged

• Working conditions are favourable

The Remuneration Committee oversees and makes
recommendations of executive remuneration and any
long-term share awards. In April 2023, we launched the
Reabold Resources plc long-term incentive plan for our
full-time senior management team. Reabold aims to invest in
competitive rewards for our people.

S172(1) (c) “The need to foster the Company’s
business relationships with suppliers, customers
and others”

Delivering our strategy requires strong mutually beneficial
relationships with suppliers, customers, governments,
and joint-venture partners. We aim to have a positive and
enduring impact on the communities in which we operate,
through partnering with national and local suppliers, and
through payments to governments in taxes and other fees.
The Group values all of its suppliers and aims to build
strong positive relationships through open communication
and adherence to trade terms. The Group is committed
to being a responsible entity and doing the right thing
for its customers, suppliers and business partners. The
Board upholds ethical business behaviour across all of
the Company’s activities and encourages management to
seek comparable business practices from all suppliers and
customers doing business with the Company. We value the
feedback we receive from our stakeholders and we take
every opportunity to ensure that where possible their wishes
are duly considered. The Board engages with stakeholders
to understand their priorities and concerns through a range
of engagement activities. Meeting commitments made to
investors is critical to building trust and confidence with
our external stakeholders. Back in 2022, management
made a commitment to improve communication with
shareholders with stakeholder engagements at least
every two months. This has taken the form of corporate
presentations, interviews with the Co-CEOs and investor
events. In 2023, we published 12 new videos on the media
section of our website, including operational updates,
investor presentations and Q&As. In Q1 2023 the Company
launched a new website so that shareholders and other
stakeholders can more easily navigate Company updates and

Reabold Resources Plc Financial statements for the year ended 31 December 2023communications. The website includes a Q&A page which
answers some of the most common investor questions.

The Co-CEOs provide a comprehensive update to the Board
on material business and external developments at each
main Board meeting. This includes significant operational
updates, e.g. partnerships, investments, divestments,
projects, commercial highlights and political or regulatory
developments.

S172(1) (d) “The impact of the Company’s
operations on the community and the environment”

This aspect is inherent in our strategic ambitions, most
notably on our ambitions to thrive through the energy
transition and to sustain a strong societal licence to
operate. As such, the Board receives information on these
topics to provide relevant information for specific Board
decisions. Executive Directors conduct site visits of various
investee company operations and hold external stakeholder
engagements, where feasible.

At present Reabold does not ‘operate’ any of the assets in
its portfolio. Our operational assets are managed by our
associate companies who are responsible for the adequacy
of standards, operations and compliance. Reabold seeks to
influence how risk is managed in arrangements where we are
not operator by ensuring we have a member of the executive
team on the Board of our associate companies. This gives
Reabold assurance that operations are and will be carried
out in a sustainable and safe manner.

Further information can be found within our ESG Statement
on page 15, and within the principal risks and uncertainties
section on page 12.

S172(1) (e) “The desirability of the Company
maintaining a reputation for high standards of
business conduct”

The Company is incorporated in the UK and governed by
the Companies Act 2006. The Company has adopted the
Quoted Companies Alliance (“QCA”) Corporate Governance
Code 2018 (the “2018 QCA Code”) and the Board
recognises the importance of maintaining a good level of
corporate governance, which together with the requirements
to comply with the AIM Rules ensures that the interests of
the Company’s stakeholders are safeguarded. Please see the
Chair’s Corporate Governance statement on pages 25 to 30.

Reabold aims to contribute to Europe’s energy security
by unlocking potential sources of near-term domestic
gas supply in economically, environmentally and socially
responsible ways. The Board periodically reviews and
approves clear frameworks, such as Reabold’s Code of

Conduct, and specific Ethics & Compliance policies, to
ensure that its high standards are maintained both within
Reabold and the business relationships we maintain. This,
complemented by the various ways the Board is informed
and monitors compliance with relevant governance
standards help ensure its decisions are taken, and that
Reabold investee companies act, in ways that promote high
standards of business conduct.

S172(1) (f) “The need to act fairly as between
members of the Company”

The Directors consider which course of action best
enables delivery of our strategy in the long-term interest
of the Company. The Board is committed to maintaining
good communication and having constructive dialogue
with its shareholders. The Company has close ongoing
relationships with its shareholders – engaging with both
retail and institutional holders during 2023. Institutional
shareholders and analysts have the opportunity to discuss
issues and provide feedback at meetings with the Company.
All shareholders are encouraged to attend the Company’s
Annual General Meeting and any general meetings held by
the Company, which present an opportunity for shareholders
to speak with the Executive Directors in a formal environment
and in more informal one to one meetings.

The primary communication tool with our shareholders is
through the Regulatory News Service (“RNS”) on regulatory
matters and matters of material substance. The Company’s
upgraded website, launched in March 2023, provides
details of the business, investor presentations and details
of the Board, changes to major shareholder information and
2018 QCA Code disclosure updates under AIM Rule 26.
Changes are promptly published on the website to enable
the shareholders to be kept abreast of Company’s affairs.
The Company’s Annual Report and Notice of Annual General
Meetings are available to all shareholders. The Interim Report
and investor presentations are also available on our website.

Investor events are held with shareholders throughout the
year. By providing a variety of ways to communicate with
investors the Company feels that it reaches out to engage
with a wide range of its stakeholders.

Principal decisions

The Board delegates day-to-day management of the
business of the Company to the Co-CEOs. The responsibility
for the execution of this delegation of authority, including
regularly monitoring it, is retained by the Board. We outline
some of the principal decisions made by the Board over the
year, and how directors have performed their duty under
Section 172.

Reabold Resources Plc Financial statements for the year ended 31 December 2023Strategic ReportCash allocation including shareholder distributions

Following the completion of the sale of Corallian in
November 2022 along with the receipt of the first tranche
payment from Shell, the board considered cash flow, the
macro environment and business performance in 2023.
The Directors approved a share buyback programme in
April 2023 with the aim of delivering value to shareholders.
The Directors considered its ordinary shares to be
undervalued and at a meaningful discount to conservatively
estimated per-share intrinsic value.

A number of considerations underpinned the decision to
commence the buyback programme including feedback
from advisors and other stakeholders, the strength of the
Company’s balance sheet and the need to continue to invest
in our assets.

Investment in LNEnergy

Over the course of the year, the Board considered and
approved new opportunities and investments. The Board
reviewed various proposals and their alignment with
Reabold’s strategy. During 2023, the Board approved
the accumulation of a 26.1% interest in LNEnergy, whose
primary asset is an exclusive option over a 90% interest in
the Colle Santo gas field onshore Italy. The Board agreed the
investment was in line with Reabold’s strategy to develop
high quality strategic European gas assets with near-term
production potential that can generate shareholder value.
LNEnergy’s primary asset is an option over a 90% interest in
the Colle Santo gas field, onshore Italy in the Abruzzo region.
The Colle Santo gas field is a highly material gas resource
with 65Bcf of 2P reserves, as estimated by RPS as of
30 September 2022, and subject to the necessary approvals
and permits, is development ready with no additional drilling
required. LNEnergy believes that the field has the potential to
generate an estimated €11-12m of gross post-tax free cash
flow per annum. On 1 May 2024 a non-binding Heads of
Agreement between Gunvor and LNEnergy for the purchase
of LNG by Gunvor from LNEnergy from the Colle Santo gas
field was executed. First production from the LNG project
expected in 2025.

Strategic Report signed on behalf of the Board

Chris Connolly
Company Secretary

May 30, 2024

Reabold Resources Plc Financial statements for the year ended 31 December 2023Colle Santo gas field

Reabold Resources Plc Financial statements for the year ended 31 December 2023Strategic ReportBoard of Directors

Jeremy Edelman - Non-Executive Chairman
Appointed: 19 December 2012

Jeremy Edelman holds Bachelor degrees in Commerce and Law together with a Master’s degree in
Applied Finance. Jeremy is admitted as a solicitor to the Supreme Courts of Western Australia and
New South Wales. Jeremy subsequently worked for some of the world’s leading investment banks,
including Bankers Trust and UBS Warburg in debt and acquisition finance. He has held consulting
and director positions in listed companies in the UK and Australia, such as Mt Grace Resources
NL, with a focus on resource exploration and development, including investment companies
established with the specific objective of investing in resources projects. He also has corporate
finance experience, having been responsible for co-coordinating a number of companies in
making acquisitions in a variety of resource sectors, including oil and gas, uranium, molybdenum,
base metals and coal. He has worked in various regions of the world, including the Republic of
Kazakhstan, Russia, South Africa and Australia. Jeremy served as a Non-Executive Director of
Leni Gas Cuba Limited until 12 July 2016, a Director of Altona Energy Plc (also known as Altona
Resources Plc) until 4 July 2006, Executive Director of Leni Gas & Oil PLC from August 2006 to
December 2010 and Director of Braemore Resources Plc until 27 July 2005.

Sachin Oza - Co-Chief Executive Officer
Appointed: 19 October 2017

Sachin Oza has 21 years of investment experience, including 17 years covering the energy
sector. He joined Guinness Asset Management in April 2016, having previously worked as an
investment analyst at M&G Investments for 13 years, where he covered the Utility, Transport,
Mining and Oil & Gas sectors on a global basis. Sachin has also held investment analyst roles at
Tokyo Mitsubishi Asset Management and JP Morgan Asset Management.

Stephen Williams - Co-Chief Executive Officer
Appointed: 19 October 2017

Stephen Williams has 19 years of experience in the energy sector. He joined Guinness Asset
Management in April 2016, having previously worked as an investment analyst at M&G between
2010 and 2016, where he focussed on energy and resources. Prior to this, Stephen worked as
an energy investment analyst for Simmons & Company International between 2005 and 2010
and from 2003 to 2005 he worked as an analyst at ExxonMobil.

Reabold Resources Plc Financial statements for the year ended 31 December 2023Anthony Samaha - Non-Executive Director
Appointed: Board: 19 December 2012; Non-Executive Director: 1 July 2022

Anthony Samaha is a Chartered Accountant who has over 30 years’ experience in accounting
and corporate finance, including resources development. Anthony worked for over 10 years
with international accounting firms, including Ernst & Young, principally in corporate finance,
gaining significant experience in valuations, IPOs, independent expert reports, and mergers and
acquisitions. Anthony has extensive experience in the listing and management of AIM quoted
companies and served as Finance Director for the Company up until 30 June 2022 before
becoming a Non-Executive Director on 1 July 2022.

Mike Felton - Non-Executive Director
Appointed: 17 September 2018

Mike Felton is an experienced fund manager in the City and brings over 30 years of financial
expertise to the Company. Mike previously served as Head of UK Retail Equities at M&G
Investments and was Manager of the M&G UK Select Fund, growing the fund’s assets from £110m
to c. £550m at its peak. Mike has also previously served as Joint Head of Equities at ISIS Asset
Management and Manager of ISIS UK Prime Fund, as well as Chief Investment Officer at Lumin
Wealth, a position he still retains part-time. Mr Felton sits on the International Tennis Federation’s
Investment Advisory Panel and is a Business Ambassador for Anthony Nolan, the UK’s blood
cancer charity and bone marrow register.

Marcos Mozetic - Non-Executive Director
Appointed: 17 September 2018

Marcos Mozetic, an exploration geologist, brings over 45 years of international technical
experience in the oil and gas industry to the Company. His most recent experience was in
designing, implementing and leading Repsol S.A’s exploration strategy between 2004 and 2016.
During this period, Repsol become a leader in reserve replacement and participated in some
of the most exciting discoveries worldwide. Previous to this, Marcos worked as a development
geologist in 1975 with Bridas, before moving into the exploration department, which he later
led. Following this, Marcos worked for BHP Petroleum and BHP Minerals as Chief Geologist for
Argentina and later Country Leader. Marcos holds a BSc and Post-Graduate degree in Petroleum
Geology from the University of Buenos Aires.

Reabold Resources Plc Financial statements for the year ended 31 December 2023Corporate GovernanceDirectors’ Report

For the year ended 31 December 2023

The Directors submit their report and the audited financial
statements of the Group and Company for the year ended
31 December 2023.

Director
Marcos Mozetic

At
31 December 2023
4,545,454

At
1 January 2023
4,545,454

Principal activities

The principal activity of the Group and Company is
investment in pre-cash flow upstream oil and gas projects,
primarily as significant interests in unlisted oil and gas
companies or majority interests in unlisted oil and gas
companies with non-operating positions on licences.

Business Review and Future Developments

A review of the business and the future developments of the
Group is presented in the Strategic Report (including a Review
of Operations and Financial Review) and Chair’s letter (all of
which, together with the Corporate Governance Statement, are
incorporated by reference into this Directors’ Report).

* Includes 173,545,454 shares held by Saltwind Enterprises Ltd, a company

connected with Jeremy Edelman.

Details of Directors’ share options are included in the
Directors Remuneration Report and Note 9.

Indemnity provisions

The Company maintains a directors’ and officers’ liability
policy on normal commercial terms which includes third
party indemnity provisions.

Political and charitable contributions

The Company made no contributions to charitable or political
bodies during the year (2022: £Nil).

Engagement with Employees, Suppliers and
Customers

Information regarding Reabold’s engagement with
employees, suppliers and customers is included in the
Section 172 statement on pages 18 to 20.

Results and dividends

The loss for the year was £7.2 million (2022: loss of
£45,000). The Company has not declared any dividends
during the year (2022: £nil). The Directors do not propose
the payment of a final dividend.

Financial Instruments

The Group’s financial risk management objectives and
policies are discussed in note 21.

Auditor

In accordance with section 489 of the Companies Act 2006,
a resolution to reappoint Mazars LLP was put to the Annual
General Meeting held on 29 June 2023 and was approved.
The auditor, Mazars LLP, will be proposed for reappointment
in accordance with Section 485 of the Companies Act 2006.
Mazars LLP has signified its willingness to continue in office
as auditor.

Statement of disclosure to auditor

So far as the Directors are aware, there is no relevant audit
information of which the Company’s auditor is unaware, and
they have taken all the steps that they ought to have taken as
Directors in order to make themselves aware of any relevant
audit information and to establish that the Company’s auditor
is aware of that information.

Events since Balance Sheet Date

Going concern

Details of post reporting date events are disclosed in Note 27
of the financial statements.

Directors and their interests

The names of the Directors who held office during the year
and their shareholdings are shown below.

Director
Jeremy Edelman*

Sachin Oza

At
31 December 2023
173,545,454

At
1 January 2023
173,545,454

75,750,299

Stephen Williams

47,304,697

Michael Felton

25,240,599

Anthony Samaha

7,818,182

The Directors consider it appropriate to continue to adopt the
going concern basis of accounting in preparing the financial
statements. See Note 1 - going concern, to the financial
statements.

Repurchase of shares

Information on share repurchases, including the number and
nominal value of the shares repurchased in 2023, can be
found in Note 22 of the financial statements.

The Directors’ report was approved by the Board and signed
on its behalf by Chris Connolly, Company Secretary, on
30 May 2024.

Reabold Resources plc

Registered in England and Wales No. 3542727

Reabold Resources Plc Financial statements for the year ended 31 December 2023Corporate governance report

Chair’s Corporate Governance Statement

2) Seek to understand and meet shareholder

Each year seems to bring more challenges for company
boards – shareholder activism; the ongoing complexity of
the energy transition; fiscal uncertainty in the UK for energy
companies surrounding the windfall tax and investment
allowances; a challenging macro environment with
headwinds from the cost-of-living crisis, high inflation and
large interest rate rises. Reabold’s corporate governance
framework needs to be both dynamic and flexible in its
application to a range of different situations.

In 2018 the Company adopted the 2018 QCA Code, which
it believes to be the most appropriate recognised corporate
governance code for the Company. The 2018 QCA Code has
ten principles which the Company is required to adhere to
and to make certain disclosures both within this report and
on its website.

The Company notes the updates made by the 2023 Quoted
Companies Alliance Corporate Governance (the ‘2023 QCA
Code’) which will apply to financial years starting on or after
1 April 2024. For the 2023 financial year, the Company has
continued to adopt the 2018 QCA Code. The Company will be
transitioning to the 2023 QCA code over the next 12 months
in order to build capability to apply its principles and address
any gaps in our current corporate governance framework.

The importance of maintaining strong relationships and
engaging with our shareholders continues and underpins
the success of the business. The Board strives to ensure
that there are numerous opportunities for investors to
engage with both the Board and Executive Directors. During
2023 the Board welcomed shareholders in person at the
Annual General Meeting. The Company also held a General
Meeting in January 2024. This provided shareholders with
an opportunity to raise questions in connection with the
Company’s strategy and to vote in favour of the Board.

I would like to thank the Reabold leadership team for their
focus, and I would like to thank our fellow shareholders for
your continued confidence in the Board.

The 2018 QCA Code has ten principles of corporate
governance that the Company has committed to apply within
the foundations of the business. These principles are:

1) Establish a strategy and business model

which promote long-term value for
shareholders

Please see Reabold’s strategy and business model on
page 4.

needs and expectations

The Executives held meetings with major shareholders
several times throughout the year and reported the views
of such shareholders to the Board. A variety of topics
were discussed including performance, capital allocation,
shareholder distributions, remuneration policies and
board priorities.

Shareholders can contact Reabold directly via the
“Contact us” section of the Reabold website. Investors
can also access information via the Investor Q&A section
of the Reabold website.

We value the feedback we receive from our shareholders,
and we take every opportunity to ensure that where
possible their wishes are duly considered. The Board
engages with shareholders to understand their priorities
and concerns through a range of engagement activities.
Back in 2022, management made a commitment to
improve communication with shareholders with stakeholder
engagements at least every two months. This has taken
the form of corporate presentations, interviews with the
Co-CEOs and investor events. In 2023, we published
12 new videos on the media section of our website,
including operational updates, investor presentations and
Q&As. In Q1 2023 the Company launched a new website
so that shareholders and other stakeholders can more easily
navigate Company updates and communications.

General Meetings in 2023

In February 2023, the Company held a general meeting
at which shareholders granted the Company authority
to make market purchases of its ordinary shares and
approved the cancellation of the Company’s share
premium account – shareholders showed strong
endorsement with 99.5% of shareholders who voted
casting votes in favour of our strategy.

All shareholders are encouraged to attend the Company’s
Annual General Meeting and any general meetings
held by the Company, which present an opportunity
for shareholders to speak with the Executive Directors
in a formal environment and in more informal one to
one meetings. At the 2023 AGM, shareholders voted in
favour of all resolutions including the reappointment of
the Executive Directors – 78% of shareholders who voted
casted votes in favour of our executive directors.

In January 2024, the Board successfully defended a
second attempt, from a group of beneficial shareholders,
to remove the entire Board of directors of Reabold and
replace them with four new directors. All resolutions

Reabold Resources Plc Financial statements for the year ended 31 December 2023Corporate Governance

proposed by the requisitioning shareholders were
rejected at a general meeting. The resolutions were
broadly unchanged from their 2022 submission which
was also rejected by shareholders. The requisitioning
shareholders received support from approximately 21%
of shareholders who voted.

3) Take into account wider stakeholder
and social responsibilities and their
implications for long-term success

The Board continues to value and recognise the
importance of engagement and cooperation with our
stakeholders. The Board recognises that the long term
success of the Company is reliant upon the efforts of the
employees of the Company and its contractors, suppliers,
regulators and other stakeholders. The Board has put in
place a range of processes and systems to ensure that
there is close oversight and contact with its key resources
and relationships. The Company has close ongoing
relationships with a broad range of its stakeholders and
provides them with the opportunity to raise issues and
provide feedback to the Company.

The Executive Directors visited the operations at Colle
Santo, Italy in 2023. The objective of the visit was to
provide the Directors with local context and provide
insights into asset operations. It was also an opportunity
to engage directly with stakeholders, including business
partners and communities and improve management’s
oversight of risks.

The Company seeks to be a responsible corporate
citizen in all its areas of operation and is committed to
maintaining a high standard of corporate governance.
A description of how the group considers key
stakeholders in its decision-making is included in the
section 172 statement on page 18. The Company’s ESG
statement is on page 15.

4) Embed effective risk management,
considering both opportunities and
threats, throughout the organisation

The Board ensures that procedures are in place and such
procedures are being implemented effectively to identify,
evaluate and manage the significant risks faced by the
Company. Key business challenges and risks are detailed
on pages 12 to 14.

The Executive Directors have regular conference calls with
the Company’s Nominated Adviser and, when relevant, the
Company’s corporate communications advisers and legal
advisers to discuss – amongst other items – operations,

key risks, and other relevant matters. Additionally,
the Group also has structured weekly operational and
management conference calls with its JV partners to
identify and discuss key business challenges and risk
areas. The Board believes that this regular programme of
internal communications provides an effective opportunity
for potential or real-time risks to be identified, considered
and – where necessary – addressed in a timely manner.
Given the Company’s current size, the Board considers
that the Executive Management team—with oversight
from the Non-Executive Board of Directors and relevant
advisers, is sufficient to identify risks applicable to
the Company and its operations and to implement an
appropriate system of controls. Accepting that no systems
of control can provide absolute assurance against
material misstatement or loss, the Directors believe that
the established systems for internal control within the
Group are appropriate to the size and cost structure of
the business. An internal audit function is not considered
necessary or practical due to the size of the Company and
the close day to day control exercised by the Executive
Directors. However, the Board will continue to monitor
the need for an internal audit function. The Board has
established appropriate reporting and control mechanisms
to ensure the effectiveness of its control systems.

5) Maintain the Board as a well-functioning,

balanced team led by the chair

As at 31 December 2023 and at the date of publication,
the Board comprised of Jeremy Edelman as the Non-
Executive Chairman, Marcos Mozetic, Michael Felton and
Anthony Samaha as Non-Executive Directors and Sachin
Oza and Stephen Williams, the Co-Chief Executive
Directors. Biographical details of the current Directors are
set out on pages 22 and 23 of this Annual Report.

The Executive Directors are expected to devote
substantially the whole of their time to their duties
with the Company. Non-Executive Directors have a
lesser time commitment which is set out in their letter
of appointment. It is anticipated that Non-Executive
Directors will spend up to 3 days a month on work for the
Company.

The Executive and Non-Executive Directors are subject to
re-election at the second annual general meeting of the
Company after their last appointment or reappointment,
if not before.

The Board retains ultimate accountability for ensuring
that the Company has a robust governance framework
in place, ensuring that governance is appropriately

Reabold Resources Plc Financial statements for the year ended 31 December 2023

embedded throughout the business. The Board meets
at least six times per annum. The Board has agreed
that appointments to the Board are made by the Board
as a whole and so has not yet created a Nominations
Committee.

The Chair has overall responsibility for the management
of the Board which in turn oversees the Company’s
strategy and operational and financial performance.
The role of the Chairman is to provide leadership of the
Board and ensure its effectiveness on all aspects of its
remit to maintain control of the Company. In addition,
the Chairman is responsible for the implementation and
practice of sound corporate governance. The Chairman is
considered to have adequate separation from the day-to-
day running of the Company.

Michael Felton and Marcos Mozetic are considered to
be Independent Directors. The Board notes that the
QCA recommends a balance between executive and
non-executive Directors and recommends that there be
two independent non-executives. The Board will review
further appointments as scale and complexity grows.

The Board has two committees as detailed below.

Audit Committee

The Audit Committee consists of Michael Felton as
Chairman, Jeremy Edelman and Anthony Samaha.
This Committee provides a forum through which the
Group’s finance functions and auditors, report to the
non-executive Directors. Meetings may be attended,
by invitation, by the Company’s Nominated Adviser,
Company Secretary, other directors and the Company’s
auditors. The principal duties and responsibilities of the
Audit Committee include:

•

Reviewing the integrity of the financial statements,
including annual reports and half-year reports;

Overseeing the group’s financial reporting disclosure
process; this includes the choice of appropriate
accounting policies;

Advising the Board whether, in the Committee’s view,
the Annual Report taken as a whole is fair, balanced
and understandable and provides the information
necessary for shareholders to assess the Company’s
position and performance, business model and
strategy;

•

Monitoring the Group’s internal financial controls and
assess their adequacy;

•

Reviewing key estimates, judgements and
assumptions applied by management in preparing
published financial statements;

Annually assessing the auditor’s independence and
objectivity; and

Making recommendations in relation to the
appointment, re-appointment and removal of the
Company’s external auditor.

The Board has not published an audit committee report,
which the Board considers to be appropriate given the
size and stage of development of the Company.

Remuneration Committee

Detailed information on the remuneration committee can
be found on pages 31 to 33.

The Board will implement a Nomination committee at the
appropriate time in line with changes to the structure,
size and composition of the Board.

6) Ensure that between them the Directors

have the necessary up-to-date experience,
skills and capabilities

The Board currently consists of six Directors. The
Company believes that the current balance of
skills in the Board as a whole, reflects a very broad
range of commercial and professional skills across
geographies and industry sectors. The complementary
skills and experience of our Board are included on
pages 22 and 23. If the Company identifies an area
where additional skills are required, the Company will
often contract an appropriately qualified third party to
advise as required.

The Board recognises that it currently has a limited
diversity, including a lack of gender balance, and this will
form a part of any future recruitment consideration if the
Board concludes that replacement or additional directors
are required.

The Board shall review annually the appropriateness and
opportunity for continuing professional development
whether formal or informal. The Company Secretary
supports the chairman and executives in addressing the
training and development needs of Directors, and their
membership of appropriate professional and industry
associations. These professional associations have
ongoing professional development requirements, which
the Company supports. The Company’s Nominated
Adviser provides training on AIM Rules and the UK
Takeover Code when required.

Reabold Resources Plc Financial statements for the year ended 31 December 2023Corporate Governance

The Board regularly consults with its legal advisers to
ensure compliance with the Companies Act and other
relevant legislation.

7) Evaluate Board performance based on
clear and relevant objectives, seeking
continuous improvement

Internal evaluation of the Board is undertaken on
an annual basis in the form of peer appraisal and
discussions to determine the effectiveness and
performance in various applicable areas to their role as
well as the Directors’ continued independence.

There is a strong flow of communication between the
Directors, and in particular between the Co-Chief
Executive Officers and the Chair, with consideration
being given to the strategic and operational needs of the
business. Minutes are drawn up to reflect the true record
of the discussions and decisions made.

The Directors have a wide knowledge of the Company’s
business and understand their duties as directors of
a quoted company. The Directors have access to the
Company’s Nominated Adviser, auditors and solicitors as
and when required. The Company’s Nominated Adviser
provides boardroom training on applicable matters.
These advisors are available to provide formal support
and advice to the Board from time to time and do so in
accordance with good practice.

The Company Secretary, who is also the Chief
Financial Officer, helps keep the Board up to date with
developments in corporate governance and liaises with
the Nominated Adviser on areas of AIM requirements.
The Company Secretary has frequent communication
with the Chair, Co- Chief Executive Officers and Chairs
of the Committees and is available to other members
of the Board as required. The Directors are also able,
at the Company’s expense, to obtain advice from external
advisers if required.

The Board is to consider periodically a succession plan.
Executive Directors are to have sufficient length of notice
periods to ensure the appointment of new personnel and
ensure sufficient time to handover responsibilities.

In Q1 2023, the Remuneration Committee undertook
a thorough and robust engagement process with
independent remuneration specialists to design a share
plan and incentive scheme for the Executive Directors
and senior management. The scheme provided the
framework for the performance evaluation of the
Executive Directors during the reporting period. The

Executive Directors’ performance evaluation is to be
undertaken annually and includes an assessment of
achievement based on a scorecard of measures. Please
see the Directors’ Remuneration Report on page 31. The
Remuneration Committee undertakes a review of the
remuneration of Executive Directors at least annually
and may consult with external consultants to assist
in the evaluation and determination of appropriate
compensation and incentivisation schemes to ensure the
Company remains competitive in retaining management.

8) Promote a corporate culture that is based

on ethical values and behaviours

We are committed to doing business in an ethical
and transparent way. The Board recognises that their
decisions regarding strategy and risk will impact the
corporate culture of the Company as a whole and that
this will impact the performance of the Company.

The Board is very aware that the tone and culture set by
the Board will greatly impact all aspects of the Company
as a whole and the way that employees behave. The
corporate governance arrangements that the Board
has adopted are designed to ensure that the Company
delivers long term value to its shareholders and that
shareholders have the opportunity to express their views
and expectations for the Company in a manner that
encourages open dialogue with the Board. A large part
of the Company’s activities is centred upon what needs
to be an open and respectful dialogue with employees,
clients and other stakeholders. Therefore, the importance
of sound ethical values and behaviours is crucial to
the ability of the Company to successfully achieve its
corporate objectives. The Board places great importance
on this aspect of corporate life and seeks to ensure that
this flows through all that the Company does.

The Board considers that at present the Company has
an open culture facilitating comprehensive dialogue
and feedback and enabling positive and constructive
challenge. The Company has a code for Directors’ and
employees’ dealings in the Company’s securities, and is
appropriate for a company whose securities are traded
on AIM and is in accordance with the requirements of
the UK Market Abuse Regulation. The Company takes
all reasonable steps to ensure it is compliant with the
Market Abuse Regulations and AIM Rules. The Company
has a zero-tolerance approach to bribery and corruption
and has an Anti-Bribery Policy in place to protect the
Company, its employees and those third parties with
which the business engages.

Reabold Resources Plc Financial statements for the year ended 31 December 2023

9) Maintain governance structures and

processes that are fit for purpose and
support good decision-making by the
Board

The Company has a single-tier Board of Directors headed
by a Chair, with executive management led by the Co-Chief
Executive Officers. The names of the Directors who held
office during the year can be found on pages 22 and 23.

There is no fixed number of times that the Board may
meet in one year. During 2023, the Board met 16 times
(13 times during 2022) and, as detailed throughout our
Strategic Report, including the Section 172 statement,
worked hard to promote the long-term sustainable
success of the Company.

In accordance with the Companies Act 2006, the Board
complies with: a duty to act within their powers; a duty to
promote the success of the Company; a duty to exercise
independent judgement; a duty to exercise reasonable
care, skill and diligence; a duty to avoid conflicts
of interest; a duty not to accept benefits from third
parties and a duty to declare any interest in a proposed
transaction or arrangement.

Ultimate authority for all aspects of the Company’s activities
rests with the Board with the respective responsibilities
of the Chair and the Executive Directors arising as a
consequence of delegation by the Board. The Board has
adopted appropriate delegations of authority which set out
matters which are reserved to the Board.

The schedule of matters reserved for the Board include:

•

Approval of the Group’s strategic plan, oversight of
the Group’s operations and review of performance in
the view of the Group’s strategy, objectives, business
plans and budgets, and ensuring that any necessary
corrective action is taken;

Ultimate oversight of risk, including determining the
Group’s risk profile and risk appetite;

Culture and succession planning;

Investments, acquisitions, divestments and other
transactions outside delegated limits;

Financial reporting and controls, including approval
of the half-year interim results, full-year results,
approval of the Annual Report and Financial
Statements, approval of any significant changes
in accounting policies or practices and ensuring
maintenance of appropriate internal control and risk
management systems;

•

Ensuring the Annual Report and Financial Statements
present a fair, balanced and understandable
assessment of the group’s position and prospects;

Assessment of the Group’s ability to continue as a
going concern;

Capital expenditure, including the annual approval
of the capital expenditure budgets and any material
changes to them in line with the Group-wide policy on
capital expenditure;

Dividend policy, including the annual review of the
dividend policy and recommendation and declaration
of any dividend;

Appointment of Directors;

Shareholder documentation, including approval of
resolutions and corresponding documentation to be
put to shareholders and approval of all material press
releases concerning matters decided by the Board;

Terms of reference of Board committees and
appointment of members to the committees; and

Key business policies, including approval of
remuneration policies.

Details of the Audit Committee and the Remuneration
Committee are provided under principle 5.

The role of the Chair is to provide leadership of the Board
and ensure its effectiveness on all aspects of its remit to
maintain control of the Company. In addition, the Chair is
responsible for the implementation and practice of sound
corporate governance. The Chair is considered to have
adequate separation from the day-to-day running of the
Company.

The Co-Chief Executive Officers have overall
responsibility for the implementation of the strategy
approved by the Board, the operational management of
the Company and the business enterprise connected with
it. The division of the CEO role reflects the collaborative
nature of decision making within Reabold. The Co-CEOs
provide complimentary and broad skill sets ranging
across technical understanding of the asset base,
business development, M&A, financial management,
strategy and stakeholder engagement, as well as the day
to day running of the business.

The Non-executive Directors bring a wide range and
balance of skills and international business experience.
Through their contribution to the Board and Board
committee meetings, respectively, they are expected to
challenge and help develop proposals on strategy and

Reabold Resources Plc Financial statements for the year ended 31 December 2023Corporate Governance

bring independent judgement on issues of performance
and risk. The Non-executive Directors discuss,
among other matters, the performance of individual
Executive Directors.

The Board considers its current governance structures
and processes to be in line and appropriate for its current
size and complexity, as well as its current capacity,
appetite and tolerance for risk. The Board will continue to
monitor the appropriateness of its governance structures
and processes over time in parallel with the Group’s
objectives, strategy and business model to reflect the
development of the group.

which discusses how the group considers the interests
of shareholders and other relevant stakeholders in its
decision making.

All shareholders are encouraged to attend the Company’s
Annual General Meeting and any general meetings held
by the Company.

The Company’s financial and operational performance is
summarised in the Annual Report and the Interim Report,
with regular updates provided to stakeholders in other
forums through the year, including press releases and
regular updates to the Company’s website.

Jeremy Edelman
Chair

30 May 2024

Attendance at Board and Committee Meetings

In order to be efficient, the Board meets formally and
informally both in person, virtually and by telephone.
To date there have been at least bimonthly meetings
of the Board, and the volume and frequency of such
meetings is expected to continue at least at this rate. The
Company had sixteen Board meetings during the year.
Attendance during 2023 for all committee meetings is
given in the table below.

Jeremy Edelman

Sachin Oza

Stephen Williams

Anthony Samaha

Marcos Mozetic

Michael Felton

Board
16/16

16/16

Audit
Committee
2/2

Remuneration
Committee
2/2

N/A

2/2

N/A

1/2

N/A

2/2

10) Communicate how the Company
is governed and is performing by
maintaining a dialogue with shareholders
and other relevant stakeholders

The work of the Audit Committee is outlined in
principle 5. The work of the Remuneration Committee
can be found in the Directors’ Remuneration Report on
page 31.

The Board is committed to maintaining regular
communication with its shareholders. Regular
constructive dialogue is important to hear the views of
shareholders and communicate Reabold’s strategy. The
Company has close ongoing relationships with its private
shareholders. Institutional shareholders and analysts
have the opportunity to discuss issues and provide
feedback at meetings with the Company. Page 18 of
this Annual Report provides a section 172 statement

Reabold Resources Plc Financial statements for the year ended 31 December 2023

Directors’ Remuneration Report

Role of the remuneration committee

The role of the Committee is to determine and recommend
to the Board the remuneration of the Chair, Executive
Directors and CFO. The Remuneration Committee reviews
remuneration policy, share schemes and the incentivisation
of the workforce. The Committee assists the Board in
discharging its oversight responsibilities relating to the
attraction, compensation, evaluation and retention of
Executive Directors and senior management. The Committee
aims to ensure that the Company has the right skills and
expertise needed to enable the Company to achieve its goals
and strategies and that fair and competitive compensation
is awarded with appropriate performance incentives across
the Company.

Key responsibilities

Recommend to the Board the remuneration principles and
policies for the Executive Directors and CFO.

Set and approve the terms of engagement, remuneration,
benefits and termination of employment for the Executive
Directors and CFO.

Prepare the remuneration report.

Jeremy Edelman

Member

Michael Felton

Member

Meetings and attendance

The Committee met twice during the year. All members
attended each meeting.

Key activities in 2023

•

Undertook a thorough and robust engagement process
with independent remuneration specialists to design
a share plan and incentive scheme for the Executive
Directors and senior management.

Designed and implemented directors and senior
management scorecards.

Agreed a framework for the 2023 bonus plan.

Considered and agreed a programme for the grant of LTIP
awards.

•

Agreed the 2023 Executive Director salaries.

Approve the principles of any equity plan.

Shaping our 2024 remuneration policy

Ensure termination terms and payments to executive
directors and CFO are appropriate.

Membership

Marcos Mozetic

Member and chair since September 2018

The Remuneration Committee believes the current policy
is robust and can generally be retained as the basis for the
2024 policy. Looking forward to 2024, the Committee will

•

Review and agree the 2024 bonus measures for the
executives.

Review the executives’ salaries.

Review employer pension contributions.

•

Executive Directors’ remuneration for the year ended 31 December 2023

Salary

Annual bonusa
Taxable benefits

Pension

Performance sharesb

Total remuneration

Sachin Oza
Co-CEO
2023
£242,627

£51,575
£530

£12,121

Nil

Stephen
Williams
Co-CEO
2023
£242,627

£51,575
£633

£12,121

Nil

Sachin Oza
Co-CEO
2022
£230,875

Nil
Nil

Stephen
Williams
Co-CEO
2022
£230,875

Nil
Nil

£11,419

Nil

£306,853

£306,956

£242,294

a The full value of the annual bonus in 2023 comprises 50% delivered in cash and 50% delivered in shares. The shares element applicable to the 2023 bonus

outcomes will be granted as soon as reasonably practicable following the publication of this report provided that no award shall be granted at any time when such
grant would be contrary to any dealing restriction. The shares will be subject to a 3 year restricted period.
b The first performance period under the LTIP scheme will be measured in April 2026. See 2023 LTIP below.

Reabold Resources Plc Financial statements for the year ended 31 December 2023Corporate GovernanceOverview of outcomes

Salary and benefits

Sachin Oza’s and Stephen Williams’ salaries increased by
5% from 1 January 2023, significantly below the 10.5%
inflation experienced in the UK in the preceding 12 months
to 31 December 2022. Both the Executive Directors’ benefits
related to remote working costs.

Annual Bonus

For 2023, the annual bonus was based on a scorecard of
measures across three categories: risk and controls (10%),
current financial health (45%) and future financial prosperity
(45%). The overall mathematical outcome of the annual
bonus scorecard was 42.6/100. The maximum bonus is
50% of salary, resulting in a bonus for the Executive Directors
of 21.3% of salary. The annual bonus is paid 50% in cash,
with 50% deferred into shares that are subject to a three-
year restricted period. This deferral is an important way of
increasing the executives’ personal shareholdings.

Pension

During the year, Sachin Oza and Stephen Williams were
eligible for employer pension contributions at a rate of 5%
of salary.

2023 LTIP

Sachin and Stephen’s remuneration is tied to longer-term
performance under a plan designed to drive strong alignment
to the execution of Reabold’s strategy. In 2023, the Executive
Directors were granted 150,000,000 ordinary shares each
(equivalent to £270,000 based on the market price on the
date of grant, 27 April 2023, for ordinary shares of 0.18p).
The vesting criteria is based on Total Shareholder Return
(“TSR”) over a three-to-five-year period. For the awards to
vest in full, the TSR of a share must be at or more than six
times (6x) the market value of a share at the grant date using
a 30-trading day average. The first measurement date shall
be at the end of year three, the second measurement date at
the end of year four and the final measurement date at the
end of year five. If TSR is less than 2.5x market value, 0%
of the award vests. If TSR is at 2.5x market value, 30% of
the award vests and if TSR is at 4x market value, 60% of the
award vests. Performance between TSR thresholds shall be
calculated on a straight-line basis.

Executive directors service contracts

The service contracts of executive directors do not have a
fixed term. Each executive director’s service contract contains
a 12-month notice period.

Director
Sachin Oza

Effective date
19 October 2017

Notice period
12 months

Scheme interests awarded to Executive Director in 2023

Stephen Williams

19 October 2017

12 months

The Committee considered and agreed a programme for the
grant of LTIP awards in 2023 ensuring a material portion of

Directors’ shareholdings

The interests, in shares of the Company, of the Directors in office during 2023, including any interests of their connected
persons, are set out in the table below.

Executive Directors

Sachin Oza

Stephen Williams

Non-executive Directors

Jeremy Edelmanb

Michael Felton

Marcos Mozetic

Anthony Samaha

Ordinary
shares held at
January 1
2023

Ordinary
shares held at
December 31
2023

Shares
(unvested
and subject to
performance
conditionsa)

75,750,299

75,750,299 150,000,000

47,304,697

47,304,697 150,000,000

173,545,454 173,545,454

25,240,599

4,545,454

7,818,182

a Relates to unvested long-term incentive awards (see above conditions)
b Includes 173,545,454 shares held by Saltwind Enterprises Ltd, a company connected with Jeremy Edelman.

Reabold Resources Plc Financial statements for the year ended 31 December 2023Chair and non-executive directors’
remuneration

Jeremy Edelman (Chair)

Michael Felton

Macros Mozetic

Anthony Samaha

Fees (£)

2023
84,000

47,000

2022
66,000

38,000

20,500

External appointments

The Board supports Executive Directors taking up
appointments outside the Company to broaden their
knowledge and experience. Each executive director is
permitted to retain any fee from their external appointments.
Such external appointments are subject to agreement by the
Chair and reported to the Board. Any external appointment
must not conflict with a director’s duties and commitments to
Reabold. Details of appointments as non-executive directors
of publicly listed companies during 2023 are shown below.

Stephen Williams

Appointee company
Europa Oil & Gas
(Holdings) plca

Additional
position
held at
appropriate
company
Director

Total
fees (£)
33,000

a As of 23 November 2023, Stephen stepped down from his role as non-

executive director of Europa Oil & Gas (Holdings) plc

The Directors’ Remuneration Report was approved by the
Board and signed on its behalf by Chris Connolly, Company
Secretary on 30 May 2024.

Reabold Resources Plc Financial statements for the year ended 31 December 2023Corporate GovernanceStatement of Directors’
Responsibilities

The Directors are responsible for keeping adequate
accounting records that are sufficient to show and explain
the Company’s transactions and disclose with reasonable
accuracy at any time the financial position of the Company
and enable them to ensure that the financial statements
comply with the Companies Act 2006. They are also
responsible for safeguarding the assets of the Company and
hence for taking reasonable steps for the prevention and
detection of fraud and other irregularities.

The Directors are responsible for ensuring the annual report
and the financial statements are made available on a website.
Financial statements are published on the Company’s
website in accordance with legislation in the United
Kingdom governing the preparation and dissemination of
financial statements, which may vary from legislation in
other jurisdictions. The maintenance and integrity of the
Company’s website is the responsibility of the Directors.
The Directors’ responsibility also extends to the ongoing
integrity of the financial statements contained therein.

The Directors are responsible for preparing the Strategic
report, the Directors’ report and the financial statements in
accordance with applicable law and regulations.

UK company law requires the Directors to prepare financial
statements for each financial year. Under such law the
Directors have elected to prepare financial statements in
accordance with international accounting standards in
conformity with the requirements of the Companies Act
2006. Under company law the Directors must not approve
the financial statements unless they are satisfied that they
give a true and fair view of the state of affairs of the Group
and Company and of the profit or loss of the group for that
period. The Directors are also required to prepare financial
statements in accordance with the rules of the London Stock
Exchange for companies trading securities on AIM.

In preparing these financial statements, the Directors are
required to:

•

select suitable accounting policies and then apply them
consistently;

make judgements and accounting estimates that are
reasonable and prudent;

state whether the financial statements comply with
international accounting standards in conformity with the
requirements of the Companies Act 2006; and

prepare the financial statements on the going concern
basis unless it is inappropriate to presume that the
Company will continue in business.

Reabold Resources Plc Financial statements for the year ended 31 December 2023Independent Auditor’s Report to the
members of Reabold Resources Plc

Opinion

We have audited the financial statements of Reabold
Resources PLC (the ‘parent company’) and its subsidiaries
(the ‘group’) for the year ended 31 December 2023 which
comprise the Group Statement of Comprehensive Income,
the Group Statement of Financial Position, the Company
Statement of Financial Position, the Group Statement of Cash
Flows, the Company Statement of Cash Flows, the Group
Statement of Changes in Equity, the Company Statement
of Changes in Equity and notes to the financial statements,
including material accounting policy information.

The financial reporting framework that has been applied
in their preparation is applicable law and UK-adopted
international accounting standards and, as regards the
parent company financial statements, as applied in
accordance with the provisions of the Companies Act 2006.

In our opinion, the financial statements:

•

give a true and fair view of the state of the group’s and of
the parent company’s affairs as at 31 December 2023
and of the group’s loss for the year then ended; and

have been properly prepared in accordance with
UK-adopted international accounting standards and,
as regards the parent company financial statements,
as applied in accordance with the provisions of the
Companies Act 2006; and

•

have been prepared in accordance with the requirements
of the Companies Act 2006.

Basis for opinion

We conducted our audit in accordance with International
Standards on Auditing (UK) (ISAs (UK)) and applicable
law. Our responsibilities under those standards are further
described in the “Auditor’s responsibilities for the audit
of the financial statements” section of our report. We are
independent of the group and the parent company in
accordance with the ethical requirements that are relevant to
our audit of the financial statements in the UK, including the
FRC’s Ethical Standard as applied to listed entities, and we
have fulfilled our other ethical responsibilities in accordance
with these requirements. We believe that the audit evidence
we have obtained is sufficient and appropriate to provide a
basis for our opinion.

Conclusions relating to going concern

In auditing the financial statements, we have concluded that
the directors’ use of the going concern basis of accounting in
the preparation of the financial statements is appropriate.

Our audit procedures to evaluate the directors’ assessment
of the group’s and the parent company’s ability to continue

to adopt the going concern basis of accounting included but
were not limited to:

•

Undertaking an initial assessment at the planning stage
of the audit to identify events or conditions that may cast
significant doubt on the group’s ability to continue as a
going concern;

Obtaining management’s formal going concern
assessment;

Obtaining an understanding of the relevant controls
relating to the directors’ going concern assessment;

Evaluating the directors’ method to assess the group’s and
the parent company’s ability to continue as a going concern;

Reviewing the directors’ going concern assessment,
which incorporated severe but plausible scenarios;

Evaluating the key assumptions used and judgements
applied by the directors in forming their conclusions on
going concern; and

Considering the impact of climate change and the current
socio-political environment on the value of the group’s
assets; and

Reviewing the appropriateness of the disclosures in the
financial statements related to going concern to endure
consistent with our findings.

Based on the work we have performed, we have not
identified any material uncertainties relating to events
or conditions that, individually or collectively, may cast
significant doubt on the group’s and the parent company’s
ability to continue as a going concern for a period of at
least twelve months from when the financial statements are
authorised for issue.

Our responsibilities and the responsibilities of the directors
with respect to going concern are described in the relevant
sections of this report.

Key audit matters

Key audit matters are those matters that, in our professional
judgement, were of most significance in our audit of the
financial statements of the current period and include the
most significant assessed risks of material misstatement
(whether or not due to fraud) we identified, including those
which had the greatest effect on: the overall audit strategy;
the allocation of resources in the audit; and directing
the efforts of the engagement team. These matters were
addressed in the context of our audit of the financial
statements as a whole, and in forming our opinion thereon,
and we do not provide a separate opinion on these matters.

We summarise below the key audit matter in forming our
opinion above, together with an overview of the principal
audit procedures performed to address each matter and our
key observations arising from those procedures.

3535

Reabold Resources Plc Financial statements for the year ended 31 December 2023Financial StatementsKey Audit Matter

How our scope addressed this matter

Carrying value of exploration & evaluation (E&E) assets and oil & gas assets (group and parent company risk)

The carrying value of exploration & evaluation and oil & gas
assets in the Group accounts total £7,023k (2022: £6,815k).
The parent company has a carrying value £6,766k (2022:
£6,451k).

The group and parent company’s accounting policy in respect
of this area is set out in the accounting policy notes in the
accounts.

The Group is involved in the extraction of oil and gas.
Under IFRS 6, Exploration for and Evaluation of Mineral
Resources, management must establish an accounting policy
specifying which expenditures are recognised as exploration
and evaluation assets and apply it consistently. The risk is
associated with the valuation, both initial recognition and
impairment, of the assets.

Our procedures included, but were not limited to, the following:

• Obtaining and challenging management’s assessments as to whether

there were indicators of impairment.

• reviewing the accounting policy in place to ensure that the point at which
exploration and evaluation assets are recognised is reasonable and in line
with IFRS 6 requirements;

• critically assessing a sample of transactions throughout the company,
subsidiary and associated companies to ensure additions have been
treated in accordance with the accounting policy;

• Performing a ‘stand back’ exercise considering any contradictory internal
or market available evidence throughout the year and post year end to
conclude the possible impact on the impairment assessment;

• making enquires of management of the potential impact of socio-

economic and climate related factors on determining the carrying values
of the assets; and

• holding discussions with component auditors and reviewing their work
performed on E&E assets to ensure appropriate and sufficient audit
evidence had been obtained around the carrying value of oil & gas assets
by associated undertaking.

Our observations

Based on the results of our procedures performed we consider that the
value of exploration & evaluation and oil & gas assets are appropriate. We
have not identified material misstatements in the disclosure of these assets
in the financial statements.

Our application of materiality and an overview
of the scope of our audit

Rationale for
benchmark
applied

The scope of our audit was influenced by our application
of materiality. We set certain quantitative thresholds for
materiality. These, together with qualitative considerations,
helped us to determine the scope of our audit and the
nature, timing and extent of our audit procedures on the
individual financial statement line items and disclosures and
in evaluating the effect of misstatements, both individually
and on the financial statements as a whole. Based on our
professional judgement, we determined materiality for the
financial statements as a whole as follows:

Materiality

Overall
materiality

Consolidated group; £647,000

Parent company; £550,000

Performance
materiality

How we
determined it

This has been calculated with reference to total
assets, of which it represents approximately 1.5%
for the group company. The parent company was
allocated slightly less in order to gain an effective
materiality for the components.

Reporting
threshold

Total assets have been identified as the principal
benchmark within the financial statements as it is
considered to be the focus of the shareholders due
to the investments, namely the subsidiaries and
associated entities, being at an early stage of revenue
generation.

1.5% has been chosen to reflect the level of
understanding of the stakeholders of the group
in relation to the inherent uncertainties around
accounting estimates and judgements.

Performance materiality is set to reduce to
an appropriately low level the probability that
the aggregate of uncorrected and undetected
misstatements in the financial statements exceeds
materiality for the financial statements as a whole.

We set performance materiality at £517,000 for
the group and £440,000 for the parent company,
which represents 80% of overall materiality in both
cases. This percentage was applied due to the
experience we have in auditing the group and the
parent company, our assessment of the group’s
and the parent company’s control environment,
and the volume of transactions.

We agreed with the directors that we would report
to them misstatements identified during our audit
above £19,500 for the group and £16,500 for the
parent company as well as misstatements below
that amount that, in our view, warranted reporting
for qualitative reasons. This threshold represents
3% of financial materiality.

3636

Reabold Resources Plc Financial statements for the year ended 31 December 2023For each component in the scope of the Group audit,
we allocated a materiality that was less than our overall
Group materiality. The range of performance materiality
allocated across the components was between £80,000
and £521,000.

As part of designing our audit, we assessed the risk of
material misstatement in the financial statements, whether
due to fraud or error, and then designed and performed audit
procedures responsive to those risks. In particular, we looked
at where the directors made subjective judgements, such as
assumptions on significant accounting estimates.

We tailored the scope of our audit to ensure that we
performed sufficient work to be able to give an opinion on
the financial statements as a whole. We used the outputs
of our risk assessment, our understanding of the group and
the parent company, their environment, controls, and critical
business processes, to consider qualitative factors to ensure
that we obtained sufficient coverage across all financial
statement line items.

Our group audit scope included an audit of the group and the
parent company financial statements of Reabold Resources
Plc. Based on our risk assessment, all entities within the
group, except for Reabold Resources Limited and Gaelic
Resources Limited (which are holding companies with no
impact on the consolidated financial statements) were
subject to full scope audit, which was performed by the
group audit team. Two of the group’s associated undertakings
were subject to audit procedures by component auditors.
Group instructions were sent to these component auditors
by the group audit team. Discussions were held with the
component auditors and specific component audit working
papers were reviewed by senior members of the group
audit team to assess the sufficiency and appropriateness of
their audit procedures for the purposes of the group audit
opinion. Audit procedures in relation to the other associated
undertaking was completed by the group engagement team.

At the parent company level, the group audit team also
tested the consolidation process and carried out analytical
procedures to confirm our conclusion that there were no
significant risks of material misstatement of the aggregated
financial information.

Other information

The other information comprises the information included
in the Annual Report and Financial Statements, other than
the financial statements and our auditor’s report thereon.
The directors are responsible for the other information.
Our opinion on the financial statements does not cover
the other information and, except to the extent otherwise

explicitly stated in our report, we do not express any form of
assurance conclusion thereon.

Our responsibility is to read the other information and,
in doing so, consider whether the other information is
materially inconsistent with the financial statements or our
knowledge obtained in the course of audit or otherwise
appears to be materially misstated. If we identify such
material inconsistencies or apparent material misstatements,
we are required to determine whether this gives rise
to a material misstatement in the financial statements
themselves. If, based on the work we have performed,
we conclude that there is a material misstatement of this
other information, we are required to report that fact.

We have nothing to report in this regard.

Opinions on other matters prescribed by the
Companies Act 2006

In our opinion, based on the work undertaken in the course
of the audit:

•

the information given in the strategic report and the
directors’ report for the financial year for which the
financial statements are prepared is consistent with the
financial statements; and

the strategic report and the directors’ report have
been prepared in accordance with applicable legal
requirements.

Matters on which we are required to report by
exception

In light of the knowledge and understanding of the group
and the parent company and their environment obtained
in the course of the audit, we have not identified material
misstatements in the strategic report or the directors’ report.

We have nothing to report in respect of the following matters
in relation to which the Companies Act 2006 requires us to
report to you if, in our opinion:

•

adequate accounting records have not been kept by the
parent company, or returns adequate for our audit have
not been received from branches not visited by us; or

the parent company financial statements are not in
agreement with the accounting records and returns; or

certain disclosures of directors’ remuneration specified
by law are not made; or

we have not received all the information and explanations
we require for our audit.

3737

Reabold Resources Plc Financial statements for the year ended 31 December 2023Financial StatementsResponsibilities of Directors

As explained more fully in the directors’ responsibilities
statement set out on page 34, the directors are responsible
for the preparation of the financial statements and for being
satisfied that they give a true and fair view, and for such
internal control as the directors determine is necessary to
enable the preparation of financial statements that are free
from material misstatement, whether due to fraud or error.

In preparing the financial statements, the directors are
responsible for assessing the group’s and the parent
company’s ability to continue as a going concern, disclosing,
as applicable, matters related to going concern and using the
going concern basis of accounting unless the directors either
intend to liquidate the group or the parent company or to
cease operations, or have no realistic alternative but to do so.

Auditor’s responsibilities for the audit of the
financial statements

Our objectives are to obtain reasonable assurance about
whether the financial statements as a whole are free from
material misstatement, whether due to fraud or error,
and to issue an auditor’s report that includes our opinion.
Reasonable assurance is a high level of assurance but is
not a guarantee that an audit conducted in accordance with
ISAs (UK) will always detect a material misstatement when it
exists. Misstatements can arise from fraud or error and are
considered material if, individually or in the aggregate, they
could reasonably be expected to influence the economic
decisions of users taken on the basis of these financial
statements.

The extent to which our procedures are capable of detecting
irregularities, including fraud is detailed below.

Irregularities, including fraud, are instances of non-compliance
with laws and regulations. We design procedures in line
with our responsibilities, outlined above, to detect material
misstatements in respect of irregularities, including fraud.

Based on our understanding of the group and the parent
company and their industry, we considered that non-
compliance with the following laws and regulations
might have a material effect on the financial statements:
employment regulation, health and safety regulation, oil and
gas laws and regulations, anti-money laundering regulation,
AIM listing rules and GDPR regulations.

To help us identify instances of non-compliance with these
laws and regulations, and in identifying and assessing the
risks of material misstatement in respect to non-compliance,
our procedures included, but were not limited to:

•

Gaining an understanding of the legal and regulatory
framework applicable to the group and the parent
company, the industry in which they operate, and the
structure of the group, and considering the risk of acts by
the group and the parent company which were contrary
to the applicable laws and regulations, including fraud;

Inquiring of the directors, management and, where
appropriate, those charged with governance, as to
whether the group and the parent company is in
compliance with laws and regulations, and discussing
their policies and procedures regarding compliance with
laws and regulations;

Inspecting correspondence with relevant licensing or
regulatory authorities;

Reviewing minutes of directors’ meetings in the year;

Discussing amongst the engagement team the laws
and regulations listed above, and remaining alert to any
indications of non-compliance; and

Considering the risk of acts by the group and the parent
company which were contrary to applicable laws and
regulations, including fraud.

We also considered those laws and regulations that have a
direct effect on the preparation of the financial statements,
such as tax legislation, AIM listing rules and the Companies
Act 2006.

In addition, we evaluated the directors’ and management’s
incentives and opportunities for fraudulent manipulation of
the financial statements, including the risk of management
override of controls, and determined that the principal risks
related to posting manual journal entries to manipulate
financial performance, management bias through
judgements and assumptions in significant accounting
estimates, in particular in relation to relation to the carrying
value of exploration and evaluation and oil & gas assets,and
significant one-off or unusual transactions.

3838

Reabold Resources Plc Financial statements for the year ended 31 December 2023Our audit procedures in relation to fraud included but were
not limited to:

•

Making enquiries of the directors and management on
whether they had knowledge of any actual, suspected or
alleged fraud;

Gaining an understanding of the internal controls
established to mitigate risks related to fraud;

Discussing amongst the engagement team the risks of
fraud;

Addressing the risks of fraud through management
override of controls by performing journal entry testing;

There are inherent limitations in the audit procedures
described above and the primary responsibility for the
prevention and detection of irregularities, including fraud,
rests with both those charged with governance and
management. As with any audit, there remained a risk
of non-detection of irregularities, as these may involve
collusion, forgery, intentional omissions, misrepresentations
or the override of internal controls.

The risks of material misstatement that had the greatest
effect on our audit are discussed in the “Key audit matters”
section of this report.

A further description of our responsibilities is available on
the Financial Reporting Council’s website at www.frc.org.uk/
auditorsresponsibilities. This description forms part of our
auditor’s report.

Use of the audit report

This report is made solely to the company’s members as
a body in accordance with Chapter 3 of Part 16 of the
Companies Act 2006. Our audit work has been undertaken
so that we might state to the company’s members those
matters we are required to state to them in an auditor’s
report and for no other purpose. To the fullest extent
permitted by law, we do not accept or assume responsibility
to anyone other than the company and the company’s
members as a body for our audit work, for this report, or for
the opinions we have formed.

Stephen Brown (Senior Statutory Auditor) for and on
behalf of Mazars LLP
Chartered Accountants and Statutory Auditor

The Pinnacle
160 Midsummer Boulevard
Milton Keynes
MK9 1FF

30 May 2024

3939

Reabold Resources Plc Financial statements for the year ended 31 December 2023Financial StatementsGroup Income
Statement

for the year ended 31 December

Continuing operations

Revenue

Cost of sales

Gross loss

Net (loss) in financial assets measured at fair value through profit or loss
Other income

Share of losses of associates

Other expenses

Net gains on sale of businesses

Exploration expense

Administration expenses

Non-underlying items

Share based payments expense

Foreign exchange gains

Operating loss

Finance costs – unwinding of discount on decommissioning provisions

Finance income

(Loss) before tax for the year

Taxation

(Loss) for the year

Attributable to:

Reabold shareholders

Earnings per share

(Loss) for the year attributable to Reabold shareholders

Per ordinary share (pence)

Basic

Diluted

Note

2023
£’000

–

(2,661)
88

(611)

–

(1,596)

(2,185)

(190)

(57)

–

(7,212)

(15)

(7,194)

–

(7,194)

2022
£’000

560

(834)

(274)

(1,851)
50

(1,576)

(89)

4,997

(74)

(1,702)

(191)

(22)

635

(97)

(16)

(45)

–

(45)

(0.08)

(0.0005)

4040

Reabold Resources Plc Financial statements for the year ended 31 December 2023Group Statement of
Comprehensive Income

For the year ended 31 December

Loss for the year

Other comprehensive income

Items that may be reclassified subsequently to profit or loss

Currency translation differences

Exchange (gains) on translation of foreign operations reclassified

Note

to loss on sale of business

Other comprehensive income

Total comprehensive income

Attributable to

Reabold Shareholders

2023
£’000

(7,194)

–

(7,194)

2022
£’000

(45)

(80)

(9)

(54)

4141

Reabold Resources Plc Financial statements for the year ended 31 December 2023Financial StatementsBalance Sheet

as at 31 December

Non-current assets
Exploration & evaluation assets

Investments in associates

Investments in subsidiaries

Other investments

Current assets
Prepayments

Trade and other receivables

Other investments

Restricted cash

Cash and cash equivalents

Total assets

Current liabilities
Trade and other payables

Accruals

Non-Current liabilities
Provision for decommissioning

Total liabilities

Net assets

EQUITY
Share capital

Share premium account

Capital redemption reserve

Treasury shares

Share based payment reserve

Retained earnings

Total Equity

Registered Number: 3542727

Group

2022
£’000

Company

2023
£’000

2022
£’000

6,815

22,272

–

3,484

32,571

120

181

8,728

5,511

14,565

47,136

198

111

309

367

676

6,766

26,083

6,451

22,272

3,470

32,877

32,208

393

4,365

5,413

10,277

43,154

326

271

597

382

979

116

629

8,728

5,511

15,009

47,217

198

111

309

367

676

Group

2023
£’000

7,023

26,083

–

33,133

126

4,365

5,413

10,024

43,157

330

271

601

382

983

42,174

46,460

42,175

46,541

10,589

1,103

200

(263)

1,977

28,568

42,174

9,044

29,033

200

–

1,920

6,263

46,460

10,589

1,103

200

(263)

1,977

28,569

42,175

9,044

29,033

200

–

1,920

6,344

46,541

Note

The loss for the Company was £7.3 million for the year ended 31 December 2023 (2022: loss of £0.6 million). In accordance
with the exemption granted under section 408 of the Companies Act 2006, a separate income statement for the Company has
not been presented.

Approved by the Board on 30 May 2024

Sachin Oza
Co-Chief Executive Officer

Stephen Williams
Co-Chief Executive Officer

4242

Reabold Resources Plc Financial statements for the year ended 31 December 2023

Statement of Changes
in Equity

for the year ended 31 December

Group
At 1 January 2022
Loss for the year
Other comprehensive income
Total comprehensive income
Share-based payments
At 31 December 2022
Loss for the year
Other comprehensive income
Total comprehensive income
Issue of ordinary share capital
Repurchase of ordinary share capital
Reduction of share premium account
Share-based payments
Share of equity-accounted entities’
changes in equity
At 31 December 2023

Note

22
22

Note

Company
At 1 January 2022
Loss for the year
Total comprehensive income
Share-based payments
At 31 December 2022
Loss for the year
Total comprehensive income
22
Issue of ordinary share capital
Repurchase of ordinary share capital 22
Reduction of share premium account
Share-based payments
Share of equity-accounted entities’
changes in equity
At 31 December 2023

Share
capital
£’000
9,044
–
–
–
–
9,044
–
–
–
1,545
–
–
–
–

Share
premium
account
£’000
29,033
–
–
–
–
29,033
–
–
–
1,524
–
(29,454)
–
–

Capital
redemption
reserve
£’000
200
–
–
–
–
200
–
–
–
–
–
–
–
–

Treasury
Shares
£’000

–
–
–
–
–
–
–
–
–
(263)
–
–
–

Share based
payments
reserve
£’000
1,898
–
–
–
22
1,920
–
–
–
–
–
–
57
–

Foreign
currency
translation
reserve
£’000
9
–
(9)
(9)
–
–
–
–
–
–
–
–
–
–

Retained
earnings
£’000
6,308
(45)
–
(45)
–
6,263
(7,194)
–
(7,194)
–
–
29,454
–
45

Total
£’000
46,492
(45)
(9)
(54)
22
46,460
(7,194)
–
(7,194)
3,069
(263)
–
57
45

10,589

1,103

200

(263)

1,977

–

28,568

42,174

Share capital
£’000
9,044
–
–
–
9,044
–
–
1,545
–
–
–
–

Share
premium
account
£’000
29,033
–
–
–
29,033
–
–
1,524
–
(29,454)
–
–

Capital
redemption
reserve
£’000
200
–
–
–
200
–
–
–
–
–
–
–

Treasury
Shares
£’000
–
–
–
–
–
–
–
–
(263)
–
–
–

Share based
payments
reserve
£’000
1,898
–
–
22
1,920
–
–

–
–
57
–

Retained
earnings
£’000
6,938
(594)
(594)
–
6,344
(7,274)
(7,274)
–
–
29,454
–
45

Total
£’000
47,113
(594)
(594)
22
46,541
(7,274)
(7,274)
3,069
(263)
–
57
45

10,589

1,103

200

(263)

1,977

28,569

42,175

4343

Reabold Resources Plc Financial statements for the year ended 31 December 2023Financial StatementsStatement of Changes
in Equity

for the year ended 31 December

Share Capital
The balance on the share capital account represents the aggregate nominal value of all ordinary and preference shares in issue.

Share premium account
The balance on the share premium account represents the amounts received in excess of the nominal value of the ordinary and preference

shares.

Capital redemption reserve
The balance on the capital redemption reserve represents the aggregate nominal value of all the ordinary shares repurchased and cancelled.

Treasury shares
Treasury shares represent Reabold shares repurchased and available for specific and limited purposes.

Share based payments reserve
The share-based payments reserve is used to recognise the value of equity-settled share-based payments provided to employees, including
key management personnel, as part of their remuneration. Refer to Note 23 for further details of these plans.

Foreign currency translation reserve
The foreign currency translation reserve records exchange differences arising from the translation of the financial statements of foreign

operations. Upon disposal of foreign operations, the related accumulated exchange differences are reclassified to the income statement.

Following the equity exchange with Daybreak in 2022, £80,000 was reclassified to the income statement. See Note 3 – Disposals.

Retained earnings
The balance held on this reserve is the accumulated retained profits and losses of the group/company

4444

Reabold Resources Plc Financial statements for the year ended 31 December 2023Cash Flow Statement

for the year ended 31 December

Group

2023
£’000

Group

2022
£’000

Company

2023
£’000

2022
£’000

Note

Operating activities
(Loss) for the period
Adjustments to reconcile loss for the period to net cash
used in operating activities

Depreciation
Exploration expenditure written off
Impairment of investments
Impairment of receivables
Net loss (gain) on financial assets at fair value through

6
7
14
17
16

profit or loss

3
15

Net gain on sale of businesses
Share of losses from associates
Net finance (income) costs
Share-based payments expense
Other non-cash movements
Unrealised currency translation (gains)
Net cash used in operating activities before working
capital movements
(Increase) in inventories
Decrease (increase) in other current assets
Increase in other current liabilities
Net cash used in operating activities
Investing activities
Expenditure on oil and gas assets
Expenditure on exploration & evaluation assets
Acquisitions
Investments in associates
Total cash capital expenditure
Proceeds from disposal of associate
Interest received
Movements in restricted cash
Net cash disposed from sale of business
Loans to subsidiaries
Net cash generated by investment activities
Financing activities
Repurchase of shares
Net cash used in financing activities
Currency translation differences relating to cash and cash
equivalents
(Decrease) Increase in cash and cash equivalents
Cash and cash equivalents at the beginning of the period 18
18
Cash and cash equivalents at the end of the period

(7,194)

(45)

(7,274)

(594)

–
1,400
–

318

–

2,661

1,851

–
611
(18)
57
–
4
(2,479)

–
32
290
(2,157)

–
(398)
(2,468)
–
(2,866)
5,159
33
–
–
–
2,326

(263)
(263)
(4)

(98)
5,511
5,413

(4,997)
1,576
(52)
22
89
(616)
(1,854)

(24)
(149)
243
(1,784)

(8)
(366)
(343)
–
(717)
3,175
6
(33)
(16)
–
2,415

–
–
(3)

628
4,883
5,511

–
–
4,665
391
(796)

–
611
(18)
57
–
4
(2,360)

–
36
288
(2,036)

–
(315)
(2,467)

(2,782)
5,159
33
–
–
(205)
2,205

(263)
(263)
(4)

(98)
5,511
5,413

–

5,163
–
(75)

(7,342)
1,576
(72)
22
–
–
(1,322)

–
(426)
210
(1,538)

–
(276)
–
–
(276)
3,175
6
–
–
(479)
2,426

–
–
1

888
4,622
5,511

4545

Reabold Resources Plc Financial statements for the year ended 31 December 2023Financial StatementsNotes to the Financial Statements

For the year ended 31 December 2023

1. Significant accounting policies, judgements, estimates and assumptions

Authorisation of financial statements and statement of compliance with International Financial Reporting
Standards

The consolidated financial statements of Reabold Resources PLC and its subsidiaries (collectively referred to as Reabold or the
Group) for the year ended 31 December 2023 were approved and signed by the Co-Chief Executive Officers on 30 May 2024
having been duly authorised to do so by the Board of Directors. Reabold is a public limited company incorporated and
domiciled in England and Wales with its registered office at 20 Primrose Street, London, EC2A 2EW. The principal activity of
the Company and the Group is to invest in pre-cash flow upstream oil and gas projects to create value and generate returns.
The Company’s ordinary shares are traded on AIM. The Group’s and Company’s financial statements have been prepared in
accordance with UK-adopted International Accounting Standards in conformity with the requirements of the Companies Act
2006. The significant accounting policies and accounting judgements, estimates and assumptions of the Group are set out
below.

Basis of preparation

The financial statements for the Group and Company have been prepared on a going concern basis and in accordance with
IFRS and IFRS Interpretations Committee (IFRIC) interpretations issued and effective for the year ended 31 December 2023.
The accounting policies that follow have been consistently applied to all years presented, except where otherwise indicated.
The consolidated financial statements have been prepared on a historical cost basis, except for the fair value remeasurement of
certain financial instruments as set out in the accounting policies and are presented in £ sterling and all values are rounded to
the nearest thousand pounds (£000), except where otherwise indicated.

Going concern

The Directors consider it appropriate to adopt the going concern basis of accounting in preparing the financial statements.
At 31 December 2023, the group held cash and cash equivalents of £5.4 million and a further £4.4 million was received
in January 2024 as part of the consideration for the sale of Corallian. The Group regularly monitors its cash, funding and
liquidity position. Near term cash projections are revised and underlying assumptions reviewed. Longer-term projections are
also updated regularly. Reabold has no borrowings, and its capital commitments can be funded from existing cash resources.
In assessing the appropriateness of the going concern assumption, management have stress-tested Reabold’s most recent
financial projections to incorporate a range of potential future outcomes by considering Reabold’s principal risks and cash
preservation measures. The Group’s financial forecasts demonstrate that the Group believes that it has sufficient financial
resources to meet its obligations as they fall due indicating the Group will continue to operate as a going concern for at least
12 months from the date of approval of the financial statements. Therefore, the Directors consider it appropriate to continue to
adopt the going concern basis of accounting in preparing these consolidated financial statements.

Significant accounting policies: use of judgements, estimates and assumptions

Inherent in the application of many of the accounting policies used in preparing the consolidated financial statements is the
need for Reabold management to make judgements, estimates and assumptions that affect the reported amounts of assets
and liabilities, the disclosure of contingent assets and liabilities, and the reported amounts of revenues and expenses. Actual
outcomes could differ from the estimates and assumptions used. The accounting judgements and estimates that have a
significant impact on the results of the Group are set out below, and should be read in conjunction with the information
provided in the Notes on financial statements.

Notes to the Financial StatementsFor the year ended 31 December 2023Reabold Resources Plc Financial statements for the year ended 31 December 2023Sources of estimation uncertainty

Determining the fair value of contingent consideration receivable

The contingent consideration relates to the disposal of Corallian which is a financial asset classified as measured at fair value
through profit or loss. In 2023 the estimation of the contingent consideration receivable was not considered a significant
source of estimation uncertainty as the remaining contingent consideration was received in full in January 2024 (see Note 16
for further information). In 2022, the fair value was determined using an estimate of discounted future cash flows that were
expected to be received based on the contractual terms and was considered a level 3 valuation under the fair value hierarchy.
The deferred consideration receivable was modelled using the maximum available external information. The discount rate used
is based on a risk-free rate adjusted for asset-specific risks. (See Note 16 for further information).

Decommissioning provision

Amounts used in recording a provision for decommissioning are estimates based on current legal and constructive
requirements and current technology and price levels for the removal of facilities and plugging and abandoning of wells. Due to
changes in relation to these items, the future actual cash outflows in relation to decommissioning are likely to differ in practice.
To reflect the effects due to changes in legislation, requirements and technology and price levels, the carrying amounts of
decommissioning provisions are reviewed on a regular basis. The discount rate applied to reflect the time value of money in
the carrying amount of provisions requires estimation. The discount rate used in the calculation of provisions is the pre-tax
rate that reflects current market assessments of the time value of money. Generally, the market assessments of the time value
of money can be reflected in the risk-free rate. Reabold considers it appropriate to use UK gilt yield returns as the basis for the
risk-free rate. The discount rate applied is reviewed regularly and adjusted following changes in market rates. The effects of
changes in estimates do not give rise to prior year adjustments and are dealt with prospectively. While the group uses its best
estimates and judgement, actual results could differ from these estimates (see Note 20 for further information).

Use of judgements

Assessment as not an investment entity

Entities that meet the definition of an investment entity within IFRS 10 are required to measure their subsidiaries at FVPL
rather than consolidate them. The criteria which define an investment entity are, as follows:

•

An entity that obtains funds from one or more investors for the purpose of providing those investors with investment
management services

An entity that commits to its investors that its business purpose is to invest funds solely for returns from capital
appreciation, investment income, or both

• An entity that measures and evaluates the performance of substantially all of its investments on a fair value basis

Reabold holds direct interests in several exploration and appraisal assets. How these assets will be monetised is not determined at
the outset, and could take several forms e.g a sale, an IPO, a farmout or taking the assets through to production. Reabold does not
commit to its investors that its business purpose is to invest funds solely for returns from capital appreciation or investment income.

The Board has concluded that the business does not meet the definition of an investment entity. These conclusions will be
reassessed on a continuous basis, if any of these criteria or characteristics change.

Investments in Daybreak, Rathlin and Danube

Judgement is required in assessing the level of control or influence over another entity in which the Group holds an interest.
For Reabold, the judgements that the Group does not have significant influence over Daybreak, and continues to have
significant influence over Rathlin and Danube are significant.

Significant influence is defined in IFRS as the power to participate in the financial and operating policy decisions of the
investee but is not control or joint control of those policies. Significant influence is presumed when an entity owns 20% or more
of the voting power of the investee. Significant influence is presumed not to be present when an entity owns less than 20% of
the voting power of the investee. IFRS identifies several indicators that may provide evidence of significant influence, including
representation on the board of directors of the investee and participation in policy-making processes.

Reabold Resources Plc Financial statements for the year ended 31 December 2023Financial StatementsDaybreak

Following Reabold’s announcement on 26 May 2022 regarding the completion of the equity exchange agreement with
Daybreak, Reabold assessed whether it has significant influence over Daybreak. Judgement is required in assessing the level of
control or influence over another entity in which the Group holds an interest. For Reabold, the judgement that the Group does
not have significant influence over Daybreak even though it holds 42% of the voting rights is significant.

Reabold does not have any directors on the Board of Daybreak, nor can it appoint any directors and it does not actively
participate in the financial and operating policy decisions of Daybreak. All significant decisions are taken by the executive
management team of Daybreak, which does not include any director, employee or contractor of Reabold. Reabold does not
exchange technical information with Daybreak nor is there any interchange of managerial personnel. Reabold is a passive
investor and does not have the ability to exercise significant influence over the operating and financial policies of Daybreak.
Reabold’s management considers, therefore, that the Group does not have significant influence over Daybreak, as defined by
IFRS. As a consequence of this judgement, Reabold accounts for its interest in Daybreak as a financial asset measured at fair
value within ‘Other investments’. See Note 16 for further information.

Rathlin

Whilst Reabold holds an equity stake in Rathlin of 59.5%, it is considered to only have significant influence and not control
over Rathlin. Pursuant to the existing Rathlin Shareholders’ Agreement, Reabold has the right to appoint only one director to
the Board of Rathlin, which comprises five directors. Reabold’s 59.5% interest in Rathlin is as a result of Rathlin’s funding
requirements and Reabold’s desire to increase its economic interest in the West Newton Project, rather than an objective
by Reabold to seek control over Rathlin. As a consequence of this judgement, Reabold does not consolidate Rathlin as a
subsidiary, but instead treats Rathlin as an associate and incorporates the results, assets and liabilities of Rathlin in the
consolidated financial statements using the equity method of accounting.

Danube

Reabold holds an equity stake in Danube of 50.8%, it is considered to only have significant influence and not control over
Danube. Pursuant to the existing Danube Shareholders’ Agreement, Reabold has the right to appoint only one director to the
Board of Danube, which comprises three directors. Reabold’s 50.8% interest in Danube is as a result of Danube’s funding
requirements and Reabold’s desire to increase its economic interest in Danube’s projects in Romania, rather than an objective
by Reabold to seek control over Danube. As a consequence of this judgement, Reabold does not consolidate Danube as a
subsidiary, but instead treats Danube as an associate and incorporates the results, assets and liabilities of Danube in the
consolidated financial statements using the equity method of accounting.

Exploration and appraisal intangible assets

Judgement is required to determine whether it is appropriate to continue to carry costs associated with exploration wells on the
balance sheet. This includes costs relating to exploration licences. It is not unusual to have such costs remaining suspended
on the balance sheet for several years while additional appraisal drilling and seismic work on the potential oil and natural gas
field is performed or while the optimum development plans and timing are established. The costs are carried based on the
current regulatory and political environment or any known changes to that environment. All such carried costs are subject to
regular technical, commercial and management review on at least an annual basis to confirm the continued intent to develop,
or otherwise extract value from, the discovery. Where this is no longer the case, the costs are immediately expensed.

The carrying amount of capitalised costs are included in Note 13.

Basis of consolidation

The consolidated group financial statements consolidate the financial statements of Reabold Resources PLC and its
subsidiaries drawn up to 31 December each year. Subsidiaries are consolidated from the date of their acquisition, being the
date on which the Group obtains control, including when control is obtained via potential voting rights, and continue to be
consolidated until the date that control ceases.

Notes to the Financial StatementsFor the year ended 31 December 2023Reabold Resources Plc Financial statements for the year ended 31 December 2023The financial statements of subsidiaries are prepared for the same reporting year as the Parent Company, using consistent
accounting policies. Intragroup balances and transactions have been eliminated.

If the group loses control over a subsidiary, it derecognises the related assets (including goodwill), liabilities, other components
of equity while any resultant gain or loss is recognised in profit or loss. Any investment retained is recognised at fair value.

Interests in other entities

Business combinations and goodwill

Business combinations are accounted for using the acquisition method. The identifiable assets acquired and liabilities assumed
are recognised at their fair values at the acquisition date.

Goodwill is initially measured as the excess of the aggregate of the consideration transferred, the amount recognised for any
non-controlling interest and the acquisition-date fair values of any previously held interest in the acquiree over the fair value of
the identifiable assets acquired and liabilities assumed at the acquisition date. The amount recognised for any non-controlling
interest is measured at the present ownership’s proportionate share in the recognised amounts of the acquiree’s identifiable
net assets. At the acquisition date, any goodwill acquired is allocated to each of the cash generating units, or groups of
cash-generating units, expected to benefit from the combination’s synergies. Following initial recognition, goodwill is measured
at cost less any accumulated impairment losses.

Goodwill may arise upon investments in joint ventures and associates, being the surplus of the cost of investment over
the group’s share of the net fair value of the identifiable assets and liabilities. Any such goodwill is recorded within the
corresponding investment in joint ventures and associates.

Goodwill may also arise upon acquisition of interests in joint operations that meet the definition of a business. The amount of
goodwill separately recognised is the excess of the consideration transferred over the group’s share of the net fair value of the
identifiable assets and liabilities.

Acquisitions, Asset Purchases and Disposals

Acquisitions of oil and gas properties are accounted for under the acquisition method when the assets acquired and liabilities
assumed constitute a business.

Transactions involving the purchase of an individual field interest, or a group of field interests, that do not constitute a business,
are treated as asset purchases. Accordingly, no goodwill and no deferred tax gross up arises, and the consideration is allocated
to the assets and liabilities purchased on an appropriate basis. Proceeds from the entire disposal of a development and
production asset, or any part thereof, are taken to the income statement together with the requisite proportional net book value
of the asset, or part thereof, being sold.

Interests in joint arrangements

Certain of the Group’s activities are conducted through joint operations. Reabold recognises, on a line-by-line basis in the
consolidated financial statements, its share of the assets, liabilities and expenses of these joint operations incurred jointly with
the other partners, along with the Group’s income from the sale of its share of the output and any liabilities and expenses that
the Group has incurred in relation to the joint operation.

Full details of Reabold’s working interests in those petroleum and natural gas exploration and production activities classified as
joint operations are included in the Review of Operations.

Interests in associates

The results, assets and liabilities of associates are incorporated in these consolidated financial statements using the equity
method of accounting as described below.

Reabold Resources Plc Financial statements for the year ended 31 December 2023Financial StatementsThe equity method of accounting

Under the equity method, an investment is carried on the balance sheet at cost plus post-acquisition changes in the Group’s
share of net assets of the entity, less distributions received and less any impairment in value of the investment. The Group
income statement reflects the Group’s share of the results after tax of the equity-accounted entity. The Group’s share of
amounts recognised directly in equity by an equity-accounted entity is recognised in the group’s statement of changes in
equity. Financial statements of equity-accounted entities are prepared for the same reporting year as the Group.

The Group assesses investments in equity-accounted entities for impairment whenever there is objective evidence that the
investment is impaired. If any such objective evidence of impairment exists, the carrying amount of the investment is compared
with its recoverable amount, being the higher of its fair value less costs of disposal and value in use. If the carrying amount
exceeds the recoverable amount, the investment is written down to its recoverable amount.

Segmental reporting

The Group’s operating segments are established on the basis of those components of the Group that are evaluated regularly
by the Co-Chief Executive Officers, Reabold’s chief decision makers, in deciding how to allocate resources and in assessing
performance. The accounting policies of the operating segments are the same as the Group’s accounting policies described in
this note. Reabold changed its segmental reporting during 2023, see ‘Change in segmentation’ below.

Foreign currency translation

In individual subsidiaries and associates, transactions in foreign currencies are initially recorded in the functional currency of
those entities at the spot exchange rate on the date of the transaction. Monetary assets and liabilities denominated in foreign
currencies are retranslated into the functional currency at the spot exchange rate on the balance sheet date. Any resulting
exchange differences are included in the income statement. Non-monetary items, other than those measured at fair value, are
not retranslated subsequent to initial recognition.

In the consolidated financial statements, the assets and liabilities of non-£ sterling functional currency subsidiaries and related
goodwill, are translated into £ sterling at the spot exchange rate on the balance sheet date. The results and cash flows of non-£
sterling functional currency subsidiaries are translated into £ sterling using average rates of exchange. In the consolidated
financial statements, exchange adjustments arising when the opening net assets and the profits for the year retained by non-£
sterling functional currency subsidiaries and associates are translated into £ sterling are recognised in a separate component
of equity and reported in other comprehensive income. On disposal of a non-£ sterling functional currency subsidiary or
associate, the related accumulated exchange gains and losses recognised in equity are reclassified from equity to the income
statement.

Intangible assets - Oil and gas exploration and evaluation expenditure

Oil and gas exploration and evaluation expenditure is accounted for using the successful efforts method of accounting as
described below.

Pre-licence costs

Pre-licence costs are expensed in the period in which they are incurred.

Licence and property acquisition costs

Exploration licence and acquisition costs are capitalised in intangible assets. Licence costs paid in connection with a right
to explore in an existing exploration area are capitalised and are reviewed at each reporting date to confirm that there is no
indication that the carrying amount exceeds the recoverable amount. This review includes confirming that exploration drilling
is still under way or firmly planned, or that it has been determined, or work is under way to determine that the discovery is
economically viable based on a range of technical and commercial considerations and that sufficient progress is being made on
establishing development plans and timing. If no future activity is planned or the licence has been relinquished or has expired,
the carrying value of the licence and property acquisition costs are written off. Upon recognition of proved reserves and
internal approval for development, the relevant expenditure is transferred to oil and gas properties.

Notes to the Financial StatementsFor the year ended 31 December 2023Reabold Resources Plc Financial statements for the year ended 31 December 2023Exploration and evaluation costs

Exploration and evaluation activity involves the search for hydrocarbon resources, the determination of technical feasibility
and the assessment of commercial viability of an identified resource. Once the legal right to explore has been acquired, costs
directly associated with an exploration well are capitalised as exploration and evaluation intangible assets until the drilling of
the well is complete and the results have been evaluated. These costs include directly attributable employee remuneration,
materials and fuel used, rig costs and payments made to contractors. Geological and geophysical costs are recognised in
the statement of profit or loss and other comprehensive income, as incurred. If no potentially commercial hydrocarbons are
discovered, the exploration asset is expensed.

If extractable hydrocarbons are found and, subject to further appraisal activity (e.g., the drilling of additional wells), it is
probable that they can be commercially developed, the costs continue to be carried as an intangible asset while sufficient/
continued progress is made in assessing the commerciality of the hydrocarbons. Costs directly associated with appraisal
activity undertaken to determine the size, characteristics and commercial potential of a reservoir following the initial discovery
of hydrocarbons, including the costs of appraisal wells where hydrocarbons were not found, are initially capitalised as an
intangible asset. All such capitalised costs are subject to technical, commercial and management review, as well as review for
indicators of impairment at least once a year. This is to confirm the continued intent to develop or otherwise extract value from
the discovery. When this is no longer the case, the costs are expensed.

When proved reserves of oil and gas are identified and development is sanctioned by management, the relevant capitalised
expenditure is first assessed for impairment and (if required) any impairment loss is recognised, then the remaining balance is
transferred to oil and gas properties.

Property, plant and equipment – Oil and gas assets

Capitalisation

Oil and gas properties are stated at cost, less any accumulated depreciation and accumulated impairment losses. Oil and
gas properties are generally accumulated into single field cost centres and represent the cost of developing the commercial
reserves and bringing them into production together with the E&E expenditures incurred in finding commercial reserves
previously transferred from E&E assets as outlined in the policy above.

Depreciation

The net book values of producing assets are depreciated generally on a field-by-field basis using the unit-of-production
method by reference to the ratio of production in the year and the related commercial reserves of the field, taking into account
the future development expenditure necessary to bring those reserves into production.

Impairment of property, plant and equipment and intangible assets (oil and gas exploration and evaluation
expenditure)

The Group assesses assets or groups of assets, called cash-generating units (CGUs), for impairment whenever events or
changes in circumstances indicate that the carrying amount of an asset or CGU may not be recoverable; for example, changes
in the Group’s business plans to dispose rather than retain assets, changes in the Group’s assumptions about commodity
prices, evidence of physical damage or, for oil and gas assets, significant downward revisions of estimated reserves or
increases in estimated future development expenditure or decommissioning costs. If any such indication of impairment
exists, the Group makes an estimate of the asset’s or CGU’s recoverable amount. Individual assets are grouped into CGUs for
impairment assessment purposes at the lowest level at which there are identifiable cash inflows that are largely independent
of the cash inflows of other groups of assets. A CGU’s recoverable amount is the higher of its fair value less costs of disposal
and its value in use. If it is probable that the value of the CGU will be primarily recovered through a disposal transaction, the
expected disposal proceeds are considered in determining the recoverable amount. Where the carrying amount of a CGU
exceeds its recoverable amount, the CGU is considered impaired and is written down to its recoverable amount.

Reabold Resources Plc Financial statements for the year ended 31 December 2023Financial StatementsInvestments

In its separate financial statements the Company recognises its investments in subsidiaries at cost less any provision for
impairment.

Financial assets

Financial assets are recognised initially at fair value, normally being the transaction price. In the case of financial assets
not measured at fair value through profit or loss, directly attributable transaction costs are also included. The subsequent
measurement of financial assets depends on their classification, as set out below. The Group derecognises financial assets
when the contractual rights to the cash flows expire or the rights to receive cash flows have been transferred to a third party
and either substantially all of the risks and rewards of the asset have been transferred, or substantially all the risks and rewards
of the asset have neither been retained nor transferred but control of the asset has been transferred. The Group classifies its
financial assets as measured at amortised cost, fair value through other comprehensive income or fair value through profit
or loss. The classification depends on the business model for managing the financial assets and the contractual cash flow
characteristics of the financial asset.

Financial assets measured at amortised cost

Financial assets are classified as measured at amortised cost when they are held in a business model the objective of which is
to collect contractual cash flows and the contractual cash flows represent solely payments of principal and interest. Gains and
losses are recognised in profit or loss when the assets are derecognised or impaired. This category of financial assets includes
trade and other receivables.

Financial assets measured at fair value through other comprehensive income

Financial assets are classified as measured at fair value through other comprehensive income when they are held in a business
model the objective of which is both to collect contractual cash flows and sell the financial assets, and the contractual cash
flows represent solely payments of principal and interest. The Group does not measure any financial assets at fair value
through other comprehensive income.

Financial assets measured at fair value through profit or loss

Financial assets are classified as measured at fair value through profit or loss when the asset does not meet the criteria to be
measured at amortised cost or fair value through other comprehensive income. Such assets are carried on the balance sheet at
fair value with gains or losses recognised in the income statement.

Investments in equity instruments

Investments in equity instruments are subsequently measured at fair value through profit or loss.

Cash and cash equivalents

Cash and cash equivalents include cash at bank and short-term bank deposits that generally have a maturity of three months
or less at the date of purchase.

Equity instruments

Equity instruments issued by the Company are recorded in equity at the proceeds received, net of direct issue costs.

Financial liabilities

Financial liabilities are recognised when the Group becomes party to the contractual provisions of the instrument.
The Group derecognises financial liabilities when the obligation specified in the contract is discharged, cancelled or expired.
The measurement of financial liabilities depends on their classification. The Group’s financial liabilities include trade and other
payables and accruals which are measured at amortised cost.

Notes to the Financial StatementsFor the year ended 31 December 2023Reabold Resources Plc Financial statements for the year ended 31 December 2023Financial liabilities measured at amortised cost

The Group’s financial liabilities are initially recognised at fair value, net of directly attributable transaction costs. The Group’s
financial liabilities currently include trade and other payables and accruals. Obligations for loans and borrowings are
recognised when the group becomes party to the related contracts and are measured initially at the fair value of consideration
received less directly attributable transaction costs. After initial recognition, interest-bearing loans and borrowings are
subsequently measured at amortised cost using the effective interest method. Gains and losses are recognised in the income
statement when the liabilities are derecognised as well as through the amortisation process.

Fair value measurement

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between
market participants. The Group categorises assets and liabilities measured at fair value into one of three levels depending
on the ability to observe inputs employed in their measurement. Level 1 inputs are quoted prices in active markets for
identical assets or liabilities. Level 2 inputs that are observable, either directly or indirectly, other than quoted prices included
within level 1 for the asset or liability. Level 3 inputs are unobservable inputs for the asset or liability reflecting significant
modifications to observable related market data or Reabold’s assumptions about pricing by market participants.

Provisions

Provisions are recognised when the Group has a present legal or constructive obligation as a result of past events, it is probable
that an outflow of resources will be required to settle the obligation, and a reliable estimate can be made of the amount of the
obligation.

Decommissioning

Liabilities for decommissioning costs are recognised when the Group has an obligation to plug and abandon a well, dismantle
and remove a facility or an item of plant and to restore the site on which it is located. Liabilities may arise upon construction
of such facilities, upon acquisition or through a subsequent change in legislation or regulations. The amount recognised is the
estimated present value of future expenditure determined in accordance with local conditions and requirements. An amount
equivalent to the decommissioning provision is recognised as part of the corresponding intangible asset (in the case of an
exploration or appraisal well) or property, plant and equipment. The decommissioning portion of the property, plant and
equipment is subsequently depreciated at the same rate as the rest of the asset. Other than the unwinding of discount on or
utilisation of the provision, any change in the present value of the estimated expenditure is reflected as an adjustment to the
provision and the corresponding asset where that asset is generating or is expected to generate future economic benefits.

Employee benefits

Wages, salaries, bonuses, social security contributions, paid annual leave and sick leave are accrued in the period in which the
associated services are rendered by the employees of the Group. The accounting policy for share-based payments is described
below.

Share-based payments

Equity-settled transactions

The cost of equity-settled transactions with employees is measured by reference to the fair value of the equity instruments on
the date on which they are granted and is recognised as an expense over the vesting period, which ends on the date on which
the employees become fully entitled to the award. A corresponding credit is recognised within equity. Fair value is determined
by using an appropriate, widely used, valuation model. In valuing equity-settled transactions, no account is taken of any vesting
conditions, other than conditions linked to the price of the shares of the Company (market conditions). Non-vesting conditions
are taken into account in the grant-date fair value, and failure to meet a non-vesting condition, where this is within the control
of the employee is treated as a cancellation and any remaining unrecognised cost is expensed.

Reabold Resources Plc Financial statements for the year ended 31 December 2023Financial StatementsIncome taxes

The tax charge represents the sum of current and deferred tax.

Current tax payable is based on taxable profits for the year. Taxable profits differ from net profits as reported in the income
statement because it excludes items that are taxable or deductible in other years and items that are not taxable or deductible.
The Company’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted at the
balance sheet date.

Deferred tax is the tax expected to be payable or recoverable on differences between the carrying amounts of assets and
liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit, and is
accounted for using the liability method. Deferred tax liabilities are recognised for all temporary differences and deferred tax
assets are recognised to the extent that it is probable that taxable profits will be available against which temporary differences
can be utilised.

The carrying amount of deferred tax assets is reviewed at each balance sheet date and reduced to the extent that it is no longer
probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax assets
are offset when there is a legally enforceable right to offset current tax assets against current liabilities and when deferred tax
assets and deferred tax liabilities relate to income taxes levied by the same tax authority on either the same taxable entity or
different taxable entity where there is an intention to settle on a net basis.

Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability or the asset is realised.

Revenue from contracts with customers

Revenue from contracts with customers is recognised when control of the goods or services are transferred to the customer at
an amount that reflects the consideration to which the Group expects to be entitled to in exchange for those goods or services.
Revenue is measured at the fair value of the consideration received or receivable and represents amounts receivable for goods
provided in the normal course of business, net of discounts, customs duties and sales taxes. The Group has concluded that
it is the principal in its revenue arrangements because it typically controls the goods or services before transferring them to
the customer.

The sale of crude oil, gas or condensate represents a single performance obligation. This generally occurs when the product is
physically transferred into the customer’s tanker, pipeline or other delivery mechanism. Revenue is accordingly recognised for
this performance obligation when control over the corresponding commodity is transferred to the customer.

Own equity instruments – treasury shares

Own equity instruments that are reacquired (treasury shares) are recognised at cost and deducted from equity. Treasury shares
represent ordinary shares repurchased and available for specific and limited purposes. No gain or loss is recognised in profit
or loss on the purchase, sale, issue or cancellation of the Group’s own equity instruments. Any difference between the carrying
amount and the consideration, if reissued, is also recognised in equity.

Finance income

Finance revenue chiefly comprises interest income from cash deposits on the basis of the effective interest rate method and is
disclosed separately on the face of the income statement.

Earnings per share

Earnings per share is calculated using the weighted average number of ordinary shares outstanding during the period. Diluted
earnings per share is calculated based on the weighted average number of ordinary shares outstanding during the period
plus the weighted average number of shares that would be issued on the conversion of all relevant potentially dilutive shares
to ordinary shares. Where the impact of converted shares would be anti-dilutive, these are excluded from the calculation of
diluted earnings.

Notes to the Financial StatementsFor the year ended 31 December 2023Reabold Resources Plc Financial statements for the year ended 31 December 2023Updates to significant accounting polices

New and amended standards and interpretations

There are no new or amended standards or interpretations adopted from 1 January 2023 onwards that have a significant
impact on the financial information.

Standards issued but not yet effective

There are no standards, amendments or interpretations in issue but not yet effective that the Directors anticipate will have a
material effect on the reported income or net assets of the group.

Other changes to significant accounting policies

Change in segmentation

During 2023, the Group’s reportable segments changed consistent with a change in the way that resources are allocated and
performance is assessed by the chief operating decision maker, who for Reabold is the Co-Chief Executive Officers, from that
date. From 2023, the Group’s reportable segments are onshore UK, offshore UK, and international. At 31 December 2022,
the Group’s reportable segments were UK/Europe and USA.

Onshore UK comprises the Group’s investment in Rathlin and the Group’s 16.67% direct interest in PEDL183, which was
previously reported as part of the UK/Europe segment.

Offshore UK comprises the Group’s interest in UK North Sea licences, which was previously reported as part of the UK/Europe
segment.

International comprises the Group’s investments in Danube Petroleum Ltd, Daybreak Oil & Gas Inc., and LNEnergy Ltd.

Comparative information for 2022 has been restated in Note 4 to reflect the changes in reportable segments.

2. Acquisitions and other significant transactions

LNEnergy

Between May and December 2023, Reabold acquired 26.1% of the ordinary share capital of LNEnergy for a cash
consideration of £1.9 million and the issuance of 1,297,297,298 new ordinary shares, as non-cash consideration.
The carrying amount of the investment in LNEnergy is reported within Investments in associates.

Simwell Resources Limited

On 3 January 2023, Reabold acquired 100% of the issued share capital of Simwell Resources. Total cash consideration for the
acquisition was £491,000, including transaction costs of £118,000. In addition to the cash consideration, 247,775,359 new
Ordinary Shares were issued as non-cash consideration for the acquisition. The acquisition of Simwell Resources Limited did
not constitute a business combination and therefore the acquisition was accounted for as an asset acquisition at cost.

Reabold Resources Plc Financial statements for the year ended 31 December 2023Financial Statements3. Disposals

Gain on sale of businesses

Disposal of Corallian

Loss on sale of business

Disposal of Reabold California

Net gains on sale of businesses

Group
2023
£’000

–

Group
2022
£’000

7,342

(2,345)

4,997

Company
2023
£’000

–

Company
2022
£’000

7,342

–

7,342

There were no amounts recognised in the income statement in respect of disposals in 2023.

Corallian Energy Limited

The net gain in respect of the disposal of the Company’s entire 49.99% interest in Corallian Energy Limited of £7.3 million
was recognised in 2022. Reabold received proceeds from the disposal of £5.2 million in 2023 and £3.2 million in 2022. The
contingent consideration relating to the disposal amounted to £4.4 million at 31 December 2023 and was received in January
2024. The amount of deferred consideration is reported within Other investments on the group balance sheet – see Note 16
for further information

Reabold California

On 26 May 2022, Reabold announced the completion of the equity exchange agreement with Daybreak. At completion of the
equity exchange agreement, Reabold no longer had “control” over Reabold California as set out under UK adopted international
accounting standards. As a result, net assets of £7.7 million, including goodwill of £329,000 and an associated deferred tax
liability of £329,000, were derecognised from the balance sheet of the group and the fair value of the investment in Daybreak
was recognised at completion at £5.3 million. In addition, accumulated exchange gains of £80,000 which were previously
charged to equity were reclassified to the income statement resulting in a loss on sale of business of £2.3 million.

4. Segmental analysis

The Directors consider the Group to have three segments, being onshore UK, offshore UK and International.

Onshore UK comprises the Group’s investment in Rathlin and the Group’s 16.67% direct interest in PEDL183, which was
previously reported as part of the UK/Europe segment.

Offshore UK comprises the Group’s interest in UK North Sea licences, which was previously reported as part of the UK/Europe
segment.

International comprises the Group’s investments in Danube Petroleum Ltd, Daybreak Oil & Gas Inc., and LNEnergy Ltd.

Notes to the Financial StatementsFor the year ended 31 December 2023Reabold Resources Plc Financial statements for the year ended 31 December 2023Other business and corporate comprises the Group’s treasury functions and corporate activities.

Year ended 31 December 2023
Net (loss) gain in financial assets measured at fair value
through profit or loss
Other income

Share of losses of associates

Exploration expense

Administration expenses

Non-underlying items

Share based payments expense

Profit (loss) on ordinary activities

Finance costs – unwinding of discount on
decommissioning provisions

Finance income

UK onshore
£’000
–

UK offshore
£’000
796

International
£’000
(3,457)

Other business &
corporate
£’000
–

Total
£’000
(2,661)

(611)

(1,596)

(2,185)

(190)

(57)

–

(105)

–

(2,178)

(190)

(57)

(724)

(3,562)

(2,377)

(7,212)

–

(15)

–

(506)

(43)

–

(1,553)

(7)

–

(549)

(15)

–

Profit (loss) before tax for the year

(564)

(724)

(3,562)

(2,344)

(7,194)

Taxation

Profit (loss) for the year

Segment assets

Segment liabilities

Additions to non-current assetsa

–

(564)

(724)

(3,562)

(2,344)

(7,194)

23,959

4,651

8,957

5,590

43,157

(404)

315

(21)

–

1,290

4,377

(558)

–

(983)

5,982

Includes additions to property, plant and equipment; goodwill; intangible assets; investments in joint ventures; and investments in associates.

Reabold Resources Plc Financial statements for the year ended 31 December 2023Financial StatementsShare of losses of associates

(738)

(762)

Year ended 31 December 2022
Revenue
Cost of salesa

Net (loss) gain in financial assets measured
at fair value through profit or loss
Other income

Other expenses

Net gain (loss) on sale of businesses

Exploration expense

General and administration expenses

Non-underlying items

Share based payments expense

Foreign exchange gains

Profit (loss) on ordinary activities

Finance costs

Finance income

UK onshore
£’000
–

UK offshore
£’000
–

International
£’000
560

Other business &
corporate
£’000
–

Consolidation
adjustments
and
eliminations
£’000
–

–

(834)

(1,926)

–

(76)

(89)

–

7,342

(2,345)

(74)

(7)

–

(12)

–

(11)

–

(191)

(22)

635

(738)

(14)

–

6,574

(4,722)

(1,211)

–

(2)

–

(Loss) before tax for the year

(752)

6,637

(4,724)

(1,206)

Taxation

(Loss) for the year

Segment assets

Segment liabilities

Additions to non-current assetsb

–

(752)

6,637

(4,724)

(1,206)

24,080

9,160

8,138

(367)

482

(71)

1,001

–

247

5,758

(238)

–

Total
£’000
560

(834)

(1,851)

(1,576)

(89)

4,997

(74)

–

(191)

(22)

635

(97)

(16)

(45)

–

(45)

47,136

(676)

1,730

(1,694)

(1,702)

a Cost of sales includes depreciation of oil and gas assets of £318,000.
b
c Comparative information for 2022 has been restated to reflect the changes in reportable segments. For more information see Note 1– Change in segmentation.

Includes additions to property, plant and equipment; goodwill; intangible assets; investments in joint ventures; and investments in associates.

5. Revenue

Oil sales

Gas Sales

Of the total oil and gas sales in 2022, 99% were sold to a single customer.

2023
£’000

–

–
–

2022
£’000

552

8
560

Notes to the Financial StatementsFor the year ended 31 December 2023Reabold Resources Plc Financial statements for the year ended 31 December 20236. Cost of Sales

Production costs

Royalties

Depreciation of oil and gas assets

7. Exploration expense

2023
£’000

–

–
–

2022
£’000

404

112

318
834

The following table represents amounts included within the Group income statement relating to activity associated with the
exploration for and evaluation of oil and natural gas resources.

Exploration expenditure written offa

Other exploration costs
Exploration expense for the year

2023
£’000

1,400

196
1,596

2022
£’000

–

74
74

Exploration expenditure written off relates to the following North Sea Licences - part of the UK offshore segment: P2332 - £633,000, P2329 - £382,000,
P2427 - £42,000, P2464 - £94,000, P2493 – £3,000, P2478 - £90,000, P2486 - £156,000. The write offs were as a result of licences either relinquished in
the year or licences soon to be relinquished.

8. Auditor’s Remuneration

Total audit fees

No fees were paid to Mazars LLP for non-audit services in 2023 or 2022.

9. Remuneration of senior management and non-executive directors

Remuneration of directors

Group and Company
Total for all directors

Emoluments

Amounts received under incentive schemes

Total

Emoluments

2023
£’000

787

–
787

2022
£’000

698

–
698

These amounts comprise fees paid to the Non-executive Chair and the Non-executive Directors and, for Executive Directors,
salary and benefits earned during the relevant financial year, plus cash bonuses awarded for the year.

Further information

Full details of individual Directors’ remuneration are given in the Directors’ Remuneration Report on page 31.

Reabold Resources Plc Financial statements for the year ended 31 December 2023Financial StatementsRemuneration of directors and senior management

Group and Company
Total for all senior management and non-executive directors

Short-term employee benefits

Pension costs

Share-based payments

Total

2023
£’000

926

57
1,015

2022
£’000

781

22
832

Senior management comprises the Executive Directors, Finance Director and Chief Financial Officer. Anthony Samaha resigned
as Finance Director on 30 June 2022, at which point he was appointed a Non-executive Director. Chris Connolly, the current
CFO, joined the senior management team on 28 March 2022.

Short-term employee benefits

These amounts comprise fees and benefits paid to the Non-executive Chair and Non-executive Directors, as well as salary,
benefits and cash bonuses for senior management.

Pensions

The amounts represent the cost to the group of providing pensions to senior management in respect of the current year of service.

Share-based payments

This is the cost to the group of senior management’s participation in share-based payment plans, as measured by the fair value
of options and shares granted, accounted for in accordance with IFRS 2 ‘Share-based Payments’.

10. Employee costs and numbers

Group and Company
Remuneration

Social security costs

Pension costs

Share-based payments

2023
£’000

787

57
972

2022
£’000

649

22
785

Employee costs do not include fees paid to Non-executive Directors.

Pension benefits are provided through defined contribution plans.

The average number of persons employed by the Group and Company during the year was 4 (2022:4), with 3 in senior management
functions (2022:3) and 1 in technical functions (2022:1). All employees are based in the UK.

The employee costs noted above relate to those employees with contracts of employment in the name of Reabold
Resources PLC. Of these costs, £90,000 are borne by other undertakings within the group (2022: £35,000).

Notes to the Financial StatementsFor the year ended 31 December 2023Reabold Resources Plc Financial statements for the year ended 31 December 202311. Taxation

Tax charged in the income statement

Current tax

Deferred tax

Tax charge in the income statement

Reconciliation of the total tax charge

Accounting profit (loss) before taxation

Statutory rate of corporation tax in the UK of 19% (2022: 19%)

Share of operating loss of associates not taxable
Expenses not deductible for tax purposes

Overseas tax impacts

Gain on sale not taxable

Deferred tax asset not recognised

Tax charge reported in income statement

Unrecognised tax losses

2023
£’000

–

–
–

2023
£’000

(7,194)

(1,367)

116
11

–

1,240

–

2022
£’000

–

–
–

2022
£’000

(45)

(9)

299
4

(949)

603

–

The Group has total unused UK tax losses of £25.2 million (2022: £17.3 million) including pre trading capital expenses and capital
losses of £9.8 million (2022: £9.4 million) for which no deferred tax asset has been recognised at the balance sheet date due to the
uncertainty of recovery of these losses. The unused tax losses have no fixed expiry date.

Company

The Company has £23.8 million (2022: £16.9 million) of UK corporation tax losses including pre trading capital expenses and
capital losses of £9.3 million (2022: £9.0 million) which are not recognised as deferred tax assets. The unused tax losses have
no fixed expiry date.

Reabold Resources Plc Financial statements for the year ended 31 December 2023Financial Statements12. Earnings per share

Basic earnings per share are calculated by dividing the profit (loss) attributable to Reabold shareholders for the year by the
weighted average number of shares outstanding during the year. The weighted average number of shares outstanding excludes
treasury shares. Diluted earnings per share are based on the same profit (loss) figures. The weighted average number of
shares outstanding during the year is increased by dilutive shares related to share-based compensation plans. If the inclusion
of potentially issuable shares could decrease diluted loss per share, the potentially issuable shares are excluded from the
weighted average number of shares outstanding used to calculate diluted earnings per share.

Profit (loss) for the year attributable to Reabold ordinary shareholders

Basic weighted average number of ordinary shares

Potential dilutive effect of ordinary shares issuable under employee share-
based payment plans

Weighted average number of ordinary shares outstanding used to calculate
diluted earnings per share

Basic earnings per share

Diluted earnings per share

2023
£’000

(7,194)

2022
£’000

(45)

2023
Number
000
9,561,792

–

2022
Number
000
8,929,613

–

9,561,792

8,929,613

2023
Pence per share

2022
Pence per share

(0.08)

(0.00)

The number of ordinary shares outstanding at 31 December 2023, excluding treasury shares was 10,272,573,468 (2022:
8,929,612,550. Between 31 December 2023 and 29 May 2024, the latest practicable date before the completion of these
financial statements, there was a decrease of 78,159,978 of ordinary shares as a result of share buybacks. For additional
information on share buy backs see Note 22.

13. Exploration and evaluation assets

Group
2023
£’000
6,815

–

1,210

398

(1,400)

–

7,023

Group
2022
£’000
9,123

240

343

572

–

(3,463)

6,815

Company
2023
£’000
6,451

–

315

–

Company
2022
£’000
5,968

–

483

–

6,766

6,451

At 1 January

Exchange adjustments

Acquisitions

Additions

Exploration expenditure written off

Disposals

At 31 December

Notes to the Financial StatementsFor the year ended 31 December 2023Reabold Resources Plc Financial statements for the year ended 31 December 2023Group

Acquisitions in 2023 relate to the acquisition of Simwell Resources – see Note 2. The 2022 acquisition represents the
acquisition of North Sea licences from Corallian.

Exploration expenditure written off relates to the following North Sea Licences – part of the UK offshore segment: P2332 - £633,000,
P2329 - £382,000, P2427 - £42,000, P2464 - £94,000, P2493 - £3,000, P2478 - £90,000, P2486 - £156,000. The write
offs were as a result of licences either relinquished in the year or licences soon to be relinquished.

Additions at 31 December 2023 include £398,000 in the UK primarily relating to the PEDL 183 licence at West Newton
(2022: £504,000 in the UK primarily relating to the PEDL 183 licence at West Newton and £68,000 in the US relating to the
California assets).

The disposal of £3.5 million in 2022 represents the derecognition of E&E assets in California as a result of the equity exchange
agreement with Daybreak.

Company

Additions at 31 December 2023 include £315,000 in the UK relating to the PEDL 183 licence at West Newton (2021: £483,000).

For information on significant judgements made in relation to oil and natural gas accounting see Oil and gas exploration and
evaluation expenditure in Note 1.

14. Investments in Subsidiaries

Company – Investment in Subsidiaries
Cost

At 1 January 2022

Additions

At 31 December 2022

Additions

At 31 December 2023

Amounts provided

At 1 January 2022

Additions

At 31 December 2022

Additions

At 31 December 2023

Net book amount:

31 December 2023

31 December 2022

31 December 2021

Total
£000

3,536

5,097

8,633

1,208

9,841

–

5,163

4,665

9,828

3,470

3,536

An impairment charge of £4.7 million was recognised in 2023 (2022: £5.2 million) following an impairment review, at an
individual subsidiary level, and in line with the requirements of IAS 36 Impairment of Assets. Taking into account the decrease
in the market value of Daybreak and licences relinquished in the year management concluded that an impairment was
necessary in terms of a deterioration of fair value less costs to dispose. The impairment charge related to the Company’s
investment in Gaelic Resources Limited and Reabold Southern North Sea Limited. The recoverable amount of Gaelic Resources
was deemed to be £13,000 based on the market value of Daybreak. The recoverable amount of Reabold Southern North Sea
was deemed to be nil, as a result of its exploration assets being fully written off.

Reabold Resources Plc Financial statements for the year ended 31 December 2023Financial StatementsDetails of the Company’s subsidiaries as at 31 December 2023 are shown below:

Subsidiaries
Reabold North Sea Limited

Reabold Resourcing Limited

Gaelic Resources Limited

Reabold Southern North Sea Limited

Reabold Investments UK Limited

% Country of incorporation

100 England & Wales

100 Isle of Man

100 England & Wales

Principal activities
Exploration and Evaluation

Investment holding

Exploration and Evaluation

Investment holding

The registered office of the Company’s subsidiaries incorporated in England & Wales is The Broadgate Tower 8th Floor,
Primrose Street, London, England, EC2A 2EW.

The registered office of Gaelic Resources is 14 Albert Street, Douglas, Isle of Man, IM1 2QA.

15. Investments in associates

The movement in investments in associates for the Group and Company including the amounts recognised in the income
statement (losses from associates) and balance sheet (investment in associate at 31 December) are shown below. From 9 May
2023 until 10 December 2023, Reabold classified its investment in LNEnergy as a financial asset measured at fair value. On
11 December 2023, Reabold gained over 20% of the voting power in LNEnergy and gained the right to appoint a director to
the board of LNEnergy. From 11 December 2023, Reabold accounts for its investment in LNEnergy as an associate because in
management’s judgement Reabold has significant influence over LNEnergy.

On 30 June 2022, Reabold classified its investment in Corallian as held for sale and equity accounting for Corallian ceased at
this point, therefore the amounts recognised in the income statement as it relates to Corallian represent the first 6 months to
30 June 2022. The additions in Corallian in 2022 represent the conversion of loan notes into equity of Corallian. The disposal
of Corallian completed on 1 November 2022. See Note 3 Disposals, for further information. For further information on the
judgements in respect of investments in associates see Note 1 – Investment in Daybreak, Rathlin and Danube.

Investment in associate at 1 January

Rathlin
17,604

Danube
4,668

2023
Total

LNEnergy

Rathlin
– 22,272 18,342

£’000
2022
Total
4,630 27,716

Corallian

Danube
4,744

Additions

–

4,377

–

636

Losses from associates

(506)

(77)

(28)

(611)

(738)

(76)

(762)

(1,576)

Changes in equity from associates

Disposals

–

(4,504)

Investment in associate at 31 December

17,143

4,591

4,349 26,083 17,604

4,668

– 22,272

Notes to the Financial StatementsFor the year ended 31 December 2023Reabold Resources Plc Financial statements for the year ended 31 December 2023
The following table provides summarised financial information for the Group’s and Company’s associates for 2023 and
2022. The information is presented on a 100% basis. The loss for the year relating to LNENergy represents the period from
11 December 2023, the date on which Reabold gained significant influence over LNEnergy.

Revenue

Profit (loss) for the year

Non-current assets

Current assets

Total assets

Current liabilities

Non-current liabilities

Total liabilities

Net assets

Group’s share in equity

Goodwill attributable to Reabold’s share of associate

Reabold’s share of currency translation differences

Reabold’s share of share-based payments

Group’s carrying amount of investment

2023
Danube
–

LNEnergy
–

Rathlin
–

£’000
Gross amount

2022
Danube
–

(151)

(136)

(1,034)

(149)

8,523

306

8,829

106

487

593

8,236

4,185

406

–

916

312

20,538

4,232

1,228

24,770

531

–

531

697

182

4,167

–

580

1,493

2,073

22,697

13,504

4,253

–

(154)

8,658

340

8,998

112

366

478

8,520

4,328

406

(66)

–

Rathlin
–

(851)

21,233

2,400

23,633

205

1,505

1,710

21,923

13,044

4,253

–

(154)

17,143

4,591

4,349

17,604

4,668

Transactions between the group and its associates are summarised below.

Sales to associates
Consultancy services

Purchases from associates
Exploration and evaluation assets

2023

Amount receivable
at 31 December
14

Sales
48

2023

Amount payable at
31 December
–

Purchases
302

£’000

2022

Amount receivable
at 31 December
14

Sales
50

£’000

2022

Purchases
275

Amount payable at
31 December
–

Reabold enters into arm’s length transactions with its associates including consultancy services. These amounts are recognised
within other income on the income statement.

The terms of outstanding balances receivable from associates are 30 days. The balances are unsecured and will be settled
in cash. There are no provisions for doubtful debts relating to these balances and no expenses recognised in the income
statement in respect of bad or doubtful debts.

The purchases from associates relate to Reabold’s 16.67% share of expenditure on the PEDL183 licence as part of the joint
operation with Rathlin and Union Jack Oil. These amounts are recognised within exploration and evaluation on the balance
sheet. Rathlin, the operator of the licence, is also an associate of Reabold by virtue of Reabold’s 59.5% interest in Rathlin.

For information on capital commitments in relation to associates see Note 24.

Reabold Resources Plc Financial statements for the year ended 31 December 2023Financial Statements
Reabold’s share of impairment charges taken by associates in 2023 was nil (2022: £688,000) and forms part of share of
losses of associates in the income statement. The 2022 amount related to writing down the ‘non-Victory’ assets to their
recoverable amount in light of the disposal proceeds Corallian received from Reabold for the acquisition of the licences
in 2022.

Details of the Company’s associates as at 31 December 2023 are shown below:

Associates
Rathlin Energy (UK) Limited

Danube Petroleum Limited

LNEnergy Ltd

16. Other investments

Contingent consideration

Investment in Connaught Oil and Gas Ltd

Investment in Daybreak

% Country of incorporation

59.5 England & Wales

50.8 England & Wales

26.1 England & Wales

Principal activities
Exploration and Evaluation

Exploration and Evaluation

Current
4,365

–

4,365

2023
Non-current
–

£’000
2022
Non-current
–

3,469

3,484

Current
8,728

–

8,728

The contingent consideration relates to amounts arising on the prior year disposal of Corallian which are financial assets classified as
measured at fair value through profit or loss. Reabold received £5.2 million in 2023 taking the accumulated consideration received
for the sale of Corallian at the end of 2023 to £8.3 million. The final tranche payment of £4.4 million was received in January 2024
following the NSTA’s grant of development and production consent for the Victory gas field.

In 2023 the estimation of the contingent consideration receivable was not considered a significant source of estimation uncertainty
as the remaining contingent consideration was received in full in January 2024. In 2022, the fair value was determined using an
estimate of discounted future cash flows that were expected to be received based on the contractual terms and was considered a
level 3 valuation under the fair value hierarchy. The deferred consideration receivable was modelled using the maximum available
external information. The discount rate used is based on a risk-free rate adjusted for asset-specific risks.

The market value of Daybreak is based on level one of the fair value hierarchy, its market price.

The table below summarises the change in fair value of other investments as reported in the income statement.

Change in fair value

2023
£’000
796

–

(3,457)

–
(2,661)

2022
£’000
57

–

(1,926)

18
(1,851)

Contingent consideration

Investment in Connaught Oil and Gas Ltd

Investment in Daybreak

Convertible loan notes

Notes to the Financial StatementsFor the year ended 31 December 2023Reabold Resources Plc Financial statements for the year ended 31 December 2023

17. Trade and other receivables

Due within one year

Amounts owed by group undertakings

Trade receivables

Amounts recoverable from JV partners

Amounts receivable from associates

VAT recoverable

Other receivables

Group

2023
£’000

–

–
126

Group

2022
£’000

–

102

48
181

Company

2023
£’000

292

–

–
393

2022
£’000

479

–

48
629

None of the group’s receivables are considered impaired and there are no financial assets past due but not impaired at the year end.
The Directors consider the carrying amount of trade and other receivables approximates to their fair value. Management considers
that there are no unreasonable concentrations of credit risk within the group.

At the reporting date the amounts owed by group undertakings to the Company are disclosed net of an impairment of £391,000
(2022: Nil). These amounts have not been secured, have no maturity and bear no interest.

18. Cash and cash equivalents and Restricted cash

Cash and cash equivalents

Restricted cash

Group

2023
£’000
5,413

Group

2022
£’000
5,511

Company

2023
£’000
5,413

2022
£’000
5,511

Cash and cash equivalents earn interest at floating rates based on daily bank deposit rates.

The restricted cash is in respect of surety bonds in the amount of £25,000 (2022: £25,000) to cover restoration of the PEDL183
West Newton site.

The Group’s exposure to credit risk arises from potential default of a counterparty, with a maximum exposure equal to the carrying
amount. The Group seeks to minimise counterparty credit risks by only depositing cash surpluses with major banks of high quality
credit standing.

Financial institutions, and their credit ratings, which held greater than 10% of the group’s cash and short-term deposits at the balance
sheet date were as follows:

Barclays Bank plc

S&P
rating
A-1

Group

2023
£’000
5,413

Group

2022
£’000
5,511

Company

2023
£’000
5,413

2022
£’000
5,511

Reabold Resources Plc Financial statements for the year ended 31 December 2023Financial Statements

19. Trade and other payables

Current:

Trade payables

Other payables

Group

2023
£’000

298

32
330

Group

2022
£’000

164

34
198

Trade payables are non-interest bearing and are generally on 15 to 30 day terms.

The Directors consider the carrying amount of trade and other payables approximates to their fair value.

20. Provision for decommissioning

At 1 January 2023

Revisions during the year

Unwinding of discount

Deletions

At 31 December 2023

Classified as:

Current

Non-current

Company

2023
£’000

294

32
326

Group
£’000
367

–

382

–

382

2022
£’000

164

34
198

Company
£’000
367

–

382

–

382

The decommissioning provision at 31 December 2023 comprises the future costs of decommissioning the group’s 16.67%
interest in wells at West Newton. The costs are expected to be incurred in 2033. The liability has been discounted at a rate of 4%
(2022: 4%) and the unwinding of discount has been classified as a finance cost. The estimation of costs, inflation and discount rates
are considered to be judgemental although changes in single variables are not individually considered to have a significant impact.
A 1.0 percentage point increase in the nominal discount rate applied, could decrease the group’s provision balance by approximately
£35,000 (2022: £37,000).

Notes to the Financial StatementsFor the year ended 31 December 2023Reabold Resources Plc Financial statements for the year ended 31 December 2023

21. Financial instruments and financial risk factors

The accounting classification of each category of financial instruments and their carrying amounts are set out below:

At 31 December 2023
Financial assets

Other investments
Trade and other receivables
Cash and cash equivalents
Restricted cash

Financial liabilities

Trade and other payables
Accruals

At 31 December 2022
Financial assets

Other investments
Trade and other receivables
Cash and cash equivalents
Restricted cash

Financial liabilities

Trade and other payables
Accruals

Group
£’000

Measured
at fair value
through profit
or loss

4,392

–

4,392

Group
£’000

Measured
at fair value
through profit
or loss

Measured at
amortised cost

Note

–

126

5,413

(330)

(271)

4,963

Measured at
amortised cost

Note

Total carrying
amount

Measured at
amortised cost

4,392

126

5,413

(330)

(271)

9,355

–

393

5,413

(326)

(271)

5,234

Total carrying
amount

Measured at
amortised cost

–

181

5,511

(198)

(111)

12,213

–

181

5,511

(198)

(111)

5,408

12,213

17,621

–

629

5,511

(198)

(111)

5,856

Company
£’000

Measured
at fair value
through profit
or loss

4,380

–

4,380

Company
£’000

Measured
at fair value
through profit
or loss

8,743

–

Total carrying
amount

4,380

393

5,413

(326)

(271)

9,614

Total carrying
amount

8,743

629

5,511

(198)

(111)

8,743

14,599

For all financial instruments within the scope of IFRS 9, the carrying amount is either the fair value, or approximates the
fair value.

Financial risk factors

It is management’s opinion that the group is not exposed to significant interest, credit or currency risks arising from its financial
instruments other than as discussed below:

•

Reabold has exposure to interest rate fluctuations on its cash deposits. This is managed in the short-term through selecting
treasury deposit periods of one to three months. Cash credit risks are mitigated through placing funds with institutions
carrying acceptable published credit ratings to minimise counterparty risk.

Reabold has no history of non-payment of trade receivables. Where Reabold operates joint ventures on behalf of partners
it seeks to recover the appropriate share of costs from these third parties. The majority of partners in these ventures are
established oil and gas companies. In the event of non-payment, operating agreements typically provide recourse through
increased venture shares.

Reabold Resources Plc Financial statements for the year ended 31 December 2023Financial Statements•

Reabold retains certain non-£ cash holdings and other financial instruments relating to its operations. The £ reporting
currency value of these may fluctuate from time to time causing reported foreign exchange gains and losses. Reabold
maintains a broad strategy of matching the currency of funds held on deposit with the expected expenditures in those
currencies. Management believes that this mitigates most of any actual potential currency risk from financial instruments.

(a) Market Risk

Market risk is the risk or uncertainty arising from possible market price movements and their impact on the future performance
of a business.

The components of market risk for Reabold are foreign currency exchange risk and interest rate risk, each of which is discussed
below:

(i) Foreign currency exchange risk

The Group enters into transactions denominated in currencies other than its GBP£ reporting currency. Non-GBP denominated
balances, subject to exchange rate fluctuations, at year-end were as follows:

Other investments

Cash and cash equivalents (US Dollar)

Group

2023
£’000
12

Group

2022
£’000
3,469

132

Company

2023
£’000

2022
£’000
–

132

The following table demonstrates the group’s sensitivity to a 10% increase or decrease in the US Dollar against the Pound
sterling. The sensitivity analysis includes only foreign currency denominated monetary items and adjusts their translation at the
year-end for a 10% change in the foreign currency rate.

Increase/decrease in foreign exchange rate

10% strengthening of £ against US$

10% weakening of £ against US$

(ii)

Interest rate risk

Effect on profit
before tax 2023
£’000

Effect on profit
before tax 2022
£’000

(2)

(360)

360

The Group’s interest rate risk is minimal as the group has no debt. The Group is exposed to interest rate movements through
its cash and cash equivalents. If interest rates were to have changed by one percentage point, assuming the cash balance at
the balance sheet date was constant throughout the whole year, and all other variables were held constant, the Group’s and
Company’s finance income for 2023 would have changed by approximately £54,000 (2022: £55,000).

(b) Credit Risk

Credit risk is the risk that a customer or counterparty to a financial instrument will fail to perform or fail to pay amounts due
causing financial loss to the group. The Group’s and Company’s exposure to credit risk is equal to the carrying value as at
the balance sheet date. Cash and treasury credit risks are mitigated through the placement of funds at institutions carrying
acceptable published credit ratings to minimise counterparty risk. Surplus cash is invested in short-term bank deposits. Where
Reabold operates joint ventures on behalf of partners, it seeks to recover the appropriate share of costs from the third-party
counterparties. The partners in these ventures are established oil and gas companies. In the event of non-payment, operating
agreements typically provide recourse through increased venture shares. Receivable balances are monitored on an ongoing
basis with appropriate follow-up action taken where necessary.

Notes to the Financial StatementsFor the year ended 31 December 2023Reabold Resources Plc Financial statements for the year ended 31 December 2023

Liquidity risk is the risk that suitable sources of funding for the Group’s business activities may not be available. The Group’s
liquidity is managed centrally by the treasury function which will arrange to fund subsidiaries’ requirements.

The Group continues to maintain suitable levels of cash and cash equivalents, amounting to £5.4 million at 31 December 2023
(2021: £5.5 million), invested with highly rated banks and readily accessible at immediate and short notice. The Group and
Company has no debt.

The table below summarises the maturity profile of the Group and Company’s financial liabilities based on contractual
undiscounted payments.

Group
Year ended 31 December 2023
Trade and other payables

Accruals

Year ended 31 December 2022
Trade and other payables

Accruals

Company
Year ended 31 December 2023
Trade and other payables

Accruals

Year ended 31 December 2022
Trade and other payables

Accruals

Capital Management

Within 1 year
£’000
330

271

Within 1 year
£’000
198

111

Within 1 year
£’000
326

271

Within 1 year
£’000
198

111

Total
£’000
330

271

Total
£’000
198

111

Total
£’000
326

271

Total
£’000
198

111

The primary objective of the Group’s capital management is to maintain appropriate levels of funding to meet the commitments
of its forward programme of exploration, development and investment expenditure, and to safeguard the entity’s ability to
continue as a going concern and create shareholder value. In considering the quantum of share buybacks, the board will take
account of the cumulative level of, and outlook for surplus cash flow. At 31 December 2023, capital employed of the group
amounted to £42.2 million (comprised of £42.2 million of equity shareholders’ funds and £nil of borrowings), compared to
£46.5 million at 31 December 2022 (comprised of £46.5 million of equity shareholders’ funds and £nil of borrowings).

At 31 December 2023, capital employed of the Company amounted to £42.2 million (comprised of £42.2 million of equity
shareholders’ funds and £nil of borrowings), compared to £46.5 million at 31 December 2022 (comprised of £46.5 million of
equity shareholders’ funds and £nil of borrowings).

Reabold Resources Plc Financial statements for the year ended 31 December 2023Financial Statements
22. Called-up Share Capital

The allotted, called-up and fully paid share capital at 31 December was as follows:

Issued (Group and Company)
“A” deferred shares of 1.65p

Shares thousand
6,916

2023

£’000
114

Shares thousand
6,916

Ordinary shares of 0.1 pence each

At 1 January

Issue of new shares

At 31 December

Total

8,929,613

1,545,072

10,474,685

10,481,601

8,930

1,545

10,475

10,589

8,929,613

–

8,929,613

8,936,529

2022

£’000
114

8,930

–

8,930

9,044

The holders of ordinary shares are entitled to one vote per share at the meetings of the Company and to dividends as declared
in proportion to the amounts paid up on the ordinary shares. No shares of the Company are currently redeemable or liable to
be redeemable at the option of the holder or the Company.

The “A” deferred shares carry no voting rights. The holders of “A” deferred shares do not have any right to receive written notice
of or attend, speak or vote at any general meeting of the Company, or to any dividend declared by the Company. They may
however be redeemed by the Company at any time at its option for one penny for all the “A” Deferred shares without obtaining
sanction of such holders.

At the Company’s Annual General Meeting (AGM) on June 29, 2023, the Board was authorised to allot ordinary shares in
the Company, and to grant rights to subscribe for or to convert any security into ordinary shares in the Company, up to an
aggregate nominal amount of £2.0 million (representing 2 billion ordinary shares of £0.001 each). This authority expires at the
end of the AGM to be held in 2024, unless previously renewed, revoked or varied by the Company in a general meeting.

At the June 29, 2023, AGM, shareholders granted the Company the authority to repurchase up to 2.3 billion ordinary shares.

In the case of purchases of the ordinary shares, the minimum price, exclusive of expenses, which may be paid for an ordinary
share is £0.001 and the maximum price, exclusive of expenses, which may be paid for an ordinary share is the higher of:
(i) an amount equal to 10% above the average market value for an ordinary share for the five business days immediately
preceding the date of the purchase; and (ii) the higher of the price of the last independent trade and the highest current
independent bid in relation to ordinary shares on the London Stock Exchange. The authorities for market purchases of the
ordinary shares will expire at the end of the AGM of the Company to be held in 2024. Ordinary shares purchased by the
Company pursuant to these authorities will either be cancelled or held in treasury. Treasury shares are shares in the Company
which are owned by the Company itself.

During 2023 the Company repurchased 202 million Ordinary Shares for a total consideration of £263,000 including
transaction costs of £2,000. All shares purchased were retained in treasury. A further 78 million Ordinary Shares were
repurchased between the end of the reporting period and 29 May 2024, the latest practicable date before the completion
of these financial statements, for a total cost of £75,000. The number of shares in issue is reduced when shares are
repurchased. These treasury shares are not taken into consideration in relation to the payment of dividends and voting at
shareholder meetings.

248 million new Ordinary Shares were issued in 2023 as part of the consideration for the acquisition of Simwell Resources.
1,297 million new Ordinary Shares were issued in 2023 as part of the investment into LNEnergy.

Notes to the Financial StatementsFor the year ended 31 December 2023Reabold Resources Plc Financial statements for the year ended 31 December 2023Treasury Shares

At 1 January

Purchases held in treasury

At 31 December

Shares thousand
–

202,112

2023

Nominal value
£’000
–

202

Shares thousand
–

2022

Nominal value
£’000
–

–

Treasury shares represent Reabold shares repurchased and available for specific and limited purposes.

23. Share-Based Payments

The Company operates two share-based employee compensation plans: the Reabold Resources plc Long Term Incentive Plan
(the “LTIP”) and the Reabold Resources plc Deferred Annual Bonus Plan. Both plans were adopted by the Board in April 2023.
All previous share option plans in the Company expired on 19 March 2023. The objective of these plans is to develop the
interest of Directors and key employees in the growth and development of the Group by providing them with the opportunity to
acquire an interest in the Company. Information on these plans for directors is shown in the Directors Remuneration Report on
pages 31 to 33.

LTIP

In April 2023, 390,000,000 share options were granted to members of the Group’s executive team and senior management.

The vesting criteria of the options is based on Total Shareholder Return (“TSR”) over a three-to-five-year period. For the awards
to vest in full, the TSR of a share must be at or more than six times (6x) the market value of a share at the grant date using a
30-trading day average. The first measurement date shall be at the end of year three, the second measurement date at the end
of year four and the final measurement date at the end of year five. If TSR is less than 2.5x market value, 0% of the award vests.
If TSR is at 2.5x market value, 30% of the award vests and if TSR is at 4x market value, 60% of the award vests. Performance
between TSR thresholds shall be calculated on a straight-line basis. The awards are structured as nil-cost options and are not
exercisable at 31 December 2023.

LTIP awards
Outstanding as at 1 January

Granted during the year

Outstanding as at 31 December

Exercisable as at 31 December

2023
Number
–

390,000,000

–

2022
Number
–

–

The Company calculates the value of share-based compensation using a Monte Carlo model, taking into account the terms and
conditions upon which the options were granted, to estimate the fair value of share options at the date of grant. There are no
cash settlement alternatives. The fair value of the LTIP options granted during 2023 was estimated on the date of grant using
the following inputs and assumptions:

Dividend yield

Volatility

Risk-free rate (3 years)

Risk-free rate (4 years)

Risk-free rate (5 years)

Share price

Exercise price

0.0%

68%

3.82%

3.73%

3.67%

£0.0018

Nil

Reabold Resources Plc Financial statements for the year ended 31 December 2023Financial StatementsThe fair value of the options at grant date was £0.00109. The estimated fair value of options is amortised to expense over
the options’ vesting period. The LTIP options can be exercised up to 5 years after the 5-year vesting period and therefore, the
contractual term of each option granted is 10 years.

The Company recognised total expenses relating to equity-settled share-based payment transactions during the year of
£57,000 (2022: £22,000). The balance on the share-based payments reserve at 31 December 2023 is £2.0 million (2022:
£1.9 million).

Deferred Annual Bonus Plan (DABP)

Under the Company’s remuneration policy, any annual bonus earned is paid 50% in cash, with 50% deferred into restricted
share units subject to a three-year restricted period. No shares were granted under the DABP in 2023. Awards applicable to
the 2023 bonus outcomes, will be granted as soon as reasonably practicable following the publication of this report provided
that no award shall be granted at any time when such grant would be contrary to any dealing restriction.

Expired share option plans

Prior to the introduction of the LTIP and the DABP, the Company operated share option plans for directors. All of these options
expired in March 2023. The following table shows the movements in expired share option plans during the year and the
corresponding weighted average exercise price (WAEP).

Outstanding as at 1 January

Granted during the year

Expired during the year

Exercised during the year

Outstanding as at 31 December

Exercisable at 31 December

24. Capital Commitments

2023
Number
125,000,000

–

2023
WAEP
pence
0.89

–

2022
Number
325,000,000

–

(125,000,000)

0.89

(200,000,000)

–

125,000,000

2022
WAEP
pence
0.78

–

0.71

–

0.89

Authorised future capital expenditure by group companies for which contracts had been signed at 31 December 2023
amounted to £nil (2022: £nil). However, the group does have obligations to carry out defined work programmes on its licences,
under the terms of the award of rights to these licences. The Company is not obliged to meet other joint venture partner shares
of these programmes.

PEDL 183

The Joint operation between Rathlin, Reabold and Union Jack have a commitment to drill and test a new Kirkham Abbey
deviated or horizontal appraisal well by June 2024. The joint venture has also committed to recomplete or sidetrack and
test one of the WNA-1, WNA-2 or WNB-1Z wells in that same timeframe. The Company estimates it’s 16.67% share of
costs for these commitments to be c.£2.2 million. Rathlin, the operator of PEDL183, is working with the NSTA to defer these
commitments to allow the time necessary for Rathlin to obtain sufficient funding for its share of the commitments.

UK North Sea

Reabold estimates its share of firm exploration and appraisal work commitments on its North Sea portfolio to be c.£50,000
over the course of 2024.

Notes to the Financial StatementsFor the year ended 31 December 2023Reabold Resources Plc Financial statements for the year ended 31 December 2023
25. Related Party Transactions and Transactions with Directors

Transactions between the Group and its associates is disclosed in Note 15. There are no related party transactions, or
transactions with Directors that require disclosure except for the remuneration items disclosed in the Directors Remuneration
Report and Note 9 above. The disclosures in Note 9 include the compensation of key management personnel. The Company’s
related parties consist of its subsidiaries and the transactions and amounts due to/due from them are disclosed in the
accompanying notes to the Company financial statements.

26. Non-underlying items

Non-underlying items are charges or credits included in the financial statements that Reabold has decided to disclose
separately because it considers such disclosure to be meaningful and relevant to investors. They are items that management
considers not to be part of underlying business operations and are disclosed in order to enable investors to understand
better and evaluate the Group’s financial performance. In 2023, Reabold incurred £190,000 (2022: £191,000) in legal
and professional fees in relation to the successful defence from a second attempt, from a group of beneficial shareholders,
to remove the entire Board of Directors of Reabold and replace them with four new directors. All resolutions proposed by the
requisitioning shareholders were rejected at a general meeting held in January 2024 (2022: rejected at a general meeting held
in November 2022).

27. Events after the reporting period

Requisitioned General Meeting

On 10 January 2024, Reabold announced that all the proposed resolutions put to shareholders at a general meeting by a
group of beneficial shareholders, including removing the entire Board of Directors and replacing it with four new directors, were
not passed.

Treasury Shares

78 million ordinary shares were repurchased between the end of the reporting period and 29 May 2024, the latest practicable
date before the completion of these financial statements, for a total cost of £75,000. The number of shares in issue is reduced
when shares are repurchased. These treasury shares are not taken into consideration in relation to the payment of dividends
and voting at shareholder meetings.

Final tranche of contingent consideration from Shell received

On 19 January 2024, Reabold received the final tranche of the contingent payment from Shell for the sale of the entire
issued share capital of Corallian Energy Limited, as announced on 1 November 2022, following receipt of Development and
Production Consent for the Victory gas field from the North Sea Transition Authority on 17 January 2024. Reabold received
£4.4 million for the final tranche, which follows the £8.3 million already received by the Company.

Loan to LNEnergy

On 26 March 2024, Reabold provided LNEnergy with a £0.5 million interest-bearing loan facility. LNEnergy had drawn down
the full facility as at the date of publication of this report. The interest-bearing loan with LNEnergy has interest charged at the
Bank of England’s base rate plus 0.75% and has a maturity date of 25 September 2024. The loan includes a clause that allows
Reabold to convert the loan into ordinary shares of LNEnergy at maturity.

Heads of Agreement Signed between Gunvor and LNEnergy

On 2 May 2024, Reabold announced the execution of a non-binding Heads of Agreement (“HoA”) between Gunvor and LNEnergy
Limited for the purchase of LNG by Gunvor from LNEnergy from the Colle Santo gas field, located onshore Italy. LNEnergy has the
exclusive right to acquire a 90% interest in Colle Santo and Reabold owns a 26.1% equity interest in LNEnergy.

Reabold Resources Plc Financial statements for the year ended 31 December 2023Financial StatementsThe HoA provides the terms on which Gunvor will purchase LNG from LNEnergy at its planned small-scale LNG production
facility at the Colle Santo gas field. Gunvor will purchase approximately 44,000 tonnes of LNG per annum. The point of sale
will be the truck loading flange at the small-scale LNG plant, and the LNG will then be delivered by truck in Italy. The price for
the LNG will be aligned with the Italian PSV price. The contract term will be for an indefinite period with a minimum term of
five years.

The HoA also provides for a potential prepayment by Gunvor for a portion of the first five years of deliveries, with such
amounts subject to prepayment being a total of approximately 66,000 tonnes of LNG, or 999,000 MWh. The average forward
Italian PSV gas price for the years 2025-2030 is currently approximately €30 / MWh. The prepayment is conditional on
agreeing definitive transaction documentation and LNEnergy obtaining the required permits to construct and operate the LNG
production facility.

Company Broker

On 9 May 2024, Reabold announced that Cavendish Capital Markets Limited will act as the Company’s sole broker with
immediate effect.

West Newton awarded AA rating for Carbon Intensity

On 24 May 2024, Reabold announced the positive conclusions of a Carbon Intensity Study on the West Newton gas development,
located within PEDL183 onshore UK in East Yorkshire, undertaken by GaffneyCline. Please see the ESG section – United Kingdom,
on page 15 and 16 for more information.

Notes to the Financial StatementsFor the year ended 31 December 2023Reabold Resources Plc Financial statements for the year ended 31 December 2023Reabold Resources Plc Financial statements for the year ended 31 December 2023

Other Information

Glossary

AGM

Annual General Meeting

bcf

Billion standard cubic feet

boe

Barrels of oil equivalent

boe/d

KPIs

Key performance indicators

LNG

Liquified natural gas

LTIP

Long-term Incentive Plan

Megajoule

Barrels of oil equivalent per day

A unit of energy equivalent to one million joules

CPR

mmboe

Competent Persons Report

Million barrels of oil equivalent

ESG

mmcf/d

Environmental, Social and Governance

Million cubic feet per day

gCO2e/MJ

Grams of carbon dioxide equivalent per megajoule of energy

Megawatt

IAS

International Accounting Standards

IFRS

MWh

Megawatt hours

UKCS

International Financial Reporting Standards

United Kingdom Continental Shelf

Reabold Resources Plc Financial statements for the year ended 31 December 2023Company Secretary

Christopher Connolly

Registrar

Neville Registrars Limited
Neville House
Steelpark Road
Halesowen
B62 8HD

Legal adviser

Hill Dickinson LLP
20 Primrose Street
London
EC2A 2EW

Public Market Admission

AIM, London
Symbol: RBD

Website

www.reabold.com

Company Number

3542727

Corporate Information

Registered Office

20 Primrose Street
London
EC2A 2EW

Nominated Adviser

Strand Hanson Limited
26 Mount Row
London
W1K 3SQ

Broker

Cavendish
1 Bartholomew Close
London
England
EC1A 7BL

Auditor

Mazars LLP
The Pinnacle
160 Midsummer Boulevard
Milton Keynes
MK9 1FF

Bankers

Barclays

Reabold Resources Plc Financial statements for the year ended 31 December 2023

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