Range Resources Limited
ABN 88 002 522 009
Annual report for the year ended
30 June 2015
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Range Resources is a growing dual listed (ASX: RRS and AIM: RRL) E&P company
with the largest private onshore acreage in Trinidad. The Company has established a
stable funding position for its growth through a number of attractive equity, supplier
and trade finance packages. The Company’s objective is to create sustainable
shareholder value by growing oil production, developing discovered resources and
continuing exploration on its highly prospective assets.
Attractive Investment Proposition:
Highly prospective assets
Largest private onshore acreage in world class petroleum province of Trinidad
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• Combination of current production from infill drilling, implementation of waterflood projects, combined with
highly prospective exploration acreage on two new blocks
Solid reserve base in proven reservoirs
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Funded work programme
Equity funding of US$30 million completed at a significant premium to the share price
12-month credit facility on drilling services in place
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• US$50 million trade financing secured
Strong strategic partner
Integrated Master Services Agreement in place with LandOcean
LandOcean provides full oilfield operations services to Range in Trinidad with four new drilling rigs added to
the fleet
Extensive drilling campaign underway
• Nimble, low cost operator
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Active drilling campaign of 22 exploration and development wells commenced
First exploration well to be spudded in Q4 2015
Streamlined operations and non-core asset rationalisation
The sale of the drilling business, Texas assets, Citation Resources equity stake completed
Puntland exit completed; Georgia and Guatemala exits continue
Liquid stock
• Combination of cornerstone / retail investors: Directors and Management invested personally
2
HIGHLIGHTS OF THE FINANCIAL YEAR
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Funding secured: Despite a challenging market for junior E&P companies, Range has established a stable
funding position for the growth of the Company through attractive equity and supplier financing packages. In
addition, the Company is looking to finalise a trade financing of up to US$50 million.
• Cutting costs and streamlining operations: The Board has been focused on driving efficiency and cost
reduction by streamlining the scale and geographic footprint of non-core and cash draining businesses; and a
reduction in G&A costs which have shown a material decrease in the last year, with the Company striving to
reduce these costs even further. During the year, the Company has successfully completed the sales of its
drilling business, Texas assets, Citation Resources equity holding and an exit from Puntland. These assets
required capital funding so each disposal has eliminated imminent spending commitments whilst raising cash
for the Company (during the year Range raised approximately US$5 million from these disposals).
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Trinidad operations: The Board is confident that the financial year of 2016 will be pivotal in improving
operational performance and growing production (the average production for the period was 562 bopd). The
expected access to four brand new drilling rigs during Q4 2015 will be crucial to improving capabilities and
limiting the downtime of Range’s development and exploration operations. The Company has finalised a 22
development and exploration well work programme, which commenced subsequent to the period end. In
addition, the Company has commenced exploration operations on the two highly prospective St Mary’s and
Guayaguayare blocks. Waterflood projects are also progressing, with water injections planned to commence
once the necessary approvals have been received.
Licences: The Company successfully signed the Exploration & Production licence and negotiated the Joint
Operating Agreement on the new St Mary’s block. Range also completed assignment of the partial interest
and the operatorship on the Guayaguayare block and applied for the approvals to transfer the remaining
interest and extension of the PSCs.
Environmental: Ongoing activities to comply with existing licence obligations and in preparation for drilling
and exploration across five blocks in Trinidad.
Financial: As a result of the actions taken by the Board and management, the financial performance during
the year has substantially improved compared to the prior year. Despite the overall loss still recorded there is
a notable, positive trend in financial performance with particular improvement being seen in key areas
between the first and second half of the year.
− The Consolidated Statement of Profit or Loss and Other Comprehensive Income for the financial year
shows a net loss attributable to owners of US$30,279,054 (2014: net loss of US$102,541,990).
− The Group’s revenue was US$13,152,954 (2014: US$21,185,745). The decrease of US$8,032,791
was primarily due to lower oil prices during the period.
− The net loss after tax from continuing operations was US$22,581,895 (2014: US$59,096,590).
Decrease in loss primarily due to large numbers of write-offs in the prior year.
− Net cash outflow from operating activities for the period was US$6,955,264 (2014: outflow
US$6,221,781).
− General and administrative costs overall decreased by US$4,537,360 to US$9,948,494 (2014:
US$14,485,854) as a result of cost cutting measures implemented across the Group.
− The net assets of
the Group decreased by US$14,271,807
(2014:
US$109,295,263). This decrease is primarily due to impairments made in the year to the Group’s
Georgian assets
(impairment of
(impairment of US$5,000,000) and Guatemalan assets
US$1,779,476), and other losses made by the Group.
to US$95,023,456
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CONTENTS
Chairman’s Statement ............................................................................................................................................................. 5
Chief Executive’s Statement .................................................................................................................................................... 7
Corporate Social Responsibility ............................................................................................................................................. 12
Corporate Governance........................................................................................................................................................... 14
Directors’ Report .................................................................................................................................................................... 24
Auditor’s Independence Declaration ...................................................................................................................................... 50
Financial Statements
Consolidated Statement of Profit or Loss and Other Comprehensive Income ........................................................... 51
Consolidated Statement of Financial Position ........................................................................................................... 52
Consolidated Statement of Changes in Equity ........................................................................................................... 53
Consolidated Statement of Cash Flows ..................................................................................................................... 54
Notes to Financial Statements ................................................................................................................................... 55
Directors’ Declaration ........................................................................................................................................................... 108
Independent Audit Report .................................................................................................................................................... 109
ASX Additional Information .................................................................................................................................................. 111
4
CHAIRMAN’S STATEMENT
Dear Shareholder
On behalf of the Board of Directors, I would like to send a very warm welcome to all shareholders as this is the first
Annual Report of the Company that we have the honour of presenting.
Despite the challenges facing the energy sector during the period, the last financial year was a year of change and
unprecedented activity for the Company, and the progress made so far by our team has been extremely encouraging.
With renewed leadership six months into the financial year, we were able to achieve a number of significant milestones
in a relatively short period. We have completed an important equity transaction with a cornerstone investor at a
significant premium to the share price and secured a credit facility with our strategic partner and oilfield services
provider LandOcean, which not only allowed the Company to commence its work programme, but also enabled us to
repay invoices through future cashflows.
Following a thorough review, we have adopted a revised Company strategy to focus on growing, managing and
operating our upstream assets. We have driven efficiency and cost reduction by streamlining the scale and geographic
footprint of our business. We successfully completed a number of non-core asset divestments, including sales of the
drilling business, Texas assets, and equity holding in Citation Resources, as well as withdrawal from Puntland. For the
first time in Range’s history, following the sale of the drilling business, the Company has positive operating cashflows
from its Trinidad operations.
During the year, we have successfully signed the Exploration & Production licence on St Mary’s block and PSCs and
operatorship on the Guayaguayare block. The first exploration well on the Guayaguayare Shallow PSC is expected to
spud during Q4 2015. Range is one of the only operators to be undertaking an extensive exploration campaign onshore
Trinidad. We feel extremely privileged to be in this advantageous position compared to our peers and very much look
forward to our continued progress with these exciting opportunities.
Waterflood projects are also progressing well. During the year, Range and LandOcean have been evaluating multiple
waterflood blocks on Beach Marcelle, South Quarry field, and Morne Diablo fields. Water injections are planned to
commence during 2016 and the projects will play a key role in our next stage of growth as oil producer.
The progress made to date is a testimony of the impressive work that our team has achieved and validates the
Company’s strategy, prospectivity of the assets and the potential to achieve significant oil production growth. There is
no doubt that the next few years will bring many challenges for the Board, management team and employees.
However, we will continue to be focused on improving the results by executing a bold and simple agenda – expand
drilling activities, grow production and cashflows.
I was extremely encouraged by the Directors and management team participating in the share purchases during the
year to a value of US$300,000. By making personal investments, we have further aligned our and shareholders’
interests and demonstrated our commitment and belief in the Company and return on the investment.
During the next financial year, shareholders can look forward to a number of key developments and steady positive
newsflow, including:
Implementation of large scale waterflood projects
• Drilling programme of initial 22 wells, aimed at production and cashflow growth
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• Exploration programme on the Guayaguayare block, including drilling of at least two exploration wells
• Exploration programme on the St Mary’s block, including audit of existing field infrastructure, facilities and
wells and tendering for drilling rig, equipment, and other oilfield services
• Remaining non-core asset divestments (Georgia, and Guatemala)
• Continued reduction of G&A costs and streamlining of operations
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In line with the business growth strategy of the Company, the Board continues to evaluate potential
acquisitions of high quality, near-term oil production assets at attractive valuations, which will create value for
shareholders, provide Range with additional production and revenue, and leverage our partner’s capabilities
and resources.
The creation of long-term value for our shareholders remains the fundamental driver of everything we do and we look
forward to demonstrating this as we develop our ambitious plans and achieve our goals. With the Company’s highly
prospective licences, drilling underway, and funding in place, I believe the Company is well positioned for future
success by growing production and reserves, and transforming Range into a significant oil producing company, which
is not yet reflected in today’s share price.
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CHAIRMAN’S STATEMENT (continued)
On behalf of the Board, I thank all our shareholders, for your continued support through this past year and as we move
forward and look forward to further success in the future.
Yours sincerely,
David Chen
Chairman
6
CHIEF EXECUTIVE’S STATEMENT
Dear Shareholder
Welcome to Range’s Annual Report.
Introduction and progress overview
I joined Range mid-way through the financial year and have been encouraged by a portfolio of very attractive
assets in Trinidad that the Company has built with experienced management team to support the future
growth.
Given the low commodity price environment, we had to take a number of immediate actions in order to
preserve cash and control costs. As a result, we completed a number of non-core asset divestments and
streamlined our operations, which allowed us to focus our time and resources on growing our core assets. As
a result of the drilling business sale, we have reduced our headcount across the Group from over 250 to 32.
Our G&A costs were down significantly by 32% during the period and we are continuing to target cost savings
across the business and improving efficiencies of our operations through maximising production and
minimising downtime.
The newly completed funding with Sibo is transformative for the Company, and provides us with capability to
progress with our work programme. I would like to thank Sibo for the support during the times of challenging
markets. It is hugely significant for the Company to have such a supportive professional cornerstone investor,
as we develop our ambitious plans.
In addition, LandOcean in conjunction with Sinosure are looking to provide Range with up to US$50 million.
The package will provide us with further funding flexibility to fully exploit the Trinidad assets and we are
hoping that it will be finalised shortly.
During the year, we have worked on enhancing our internal control and risk management processes to ensure
they are implemented across our operations. Numerous policies and procedures to mitigate the risk (as
described in more detail in the Directors’ report) were implemented. Regular revision and reviews are
conducted by the management with oversight at the Board level.
In addition to my CEO position, I have extended my role to that of Trinidad General Manager, focusing on
managing the Trinidad business, growing production and driving profitability. Together with the local
management team, we have been working on improving forward planning in permitting as much as possible,
and have implemented new tracking systems which resulted in several of the approval application processes
becoming more standardised. In addition, along with other operator companies in Trinidad, we have been
working with the relevant authorities to define better guidelines, which have led to improved submissions and
approval timelines. We are extremely pleased with continued support from the government of Trinidad and
Tobago, and will continue to actively engage and cooperate with the government on our growth plans and
strategy.
With funding in place, addition of four new rigs to the drilling fleet, and LandOcean as a key oilfield services
provider, we are confident that we will be able to deliver on our plans and drill in excess of 20 exploration and
development wells during 2015/ 2016. By expanding our drilling campaign and improving our knowledge of the
reservoirs, not only we are aiming to achieve material production growth, we are also hoping to grow our
reserves base.
Health, safety, and environment (HSE)
During the year, Range continued with its commitment to safe operations. Health and Safety inspections were
regularly performed on all the assets, with no major issues identified. The management has HSE reporting and
review processes as part of its operational management in place, which are regularly reviewed by the Board.
The chart below demonstrates the HSE performance during the year.
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CHIEF EXECUTIVE’S STATEMENT (continued)
The Company is achieving a Lost Time Incident frequency rate of 2.5 which is below to that reported by the
American Petroleum Institute for the onshore US Oil & Gas Industry.
During the year, the Company has successfully completed its accreditation process in Trinidad as per STOW
(“Safe to Work”) requirements and was granted two years certification, effective December 2014. This was a
result of implementation of the various HSE management systems, and we will continue to manage, monitor
and lend support towards the continued focus on HSE through effective leadership and involvement.
In addition, during the year Range’s HSE and gathering station teams won a number of awards at Petrotrin’s
annual HSE Leadership Forum including the top award for best all round lease operator. I am pleased to
acknowledge all the efforts and hard work from the team members for these achievements and hope that we
will continue with such a dedication in 2016 and beyond.
Production
During the year, our average production of approximately 560 bopd was largely unchanged from the previous
year. The lack of production growth was a result of few wells drilled during the year caused by failures of old
rigs and equipment. In addition, results from the South Quarry development wells were disappointing and did
not achieve the production rates that were anticipated.
Despite being disappointed by lack of new drilling during the period, it is important to recognise the hard work
of our production team in Trinidad. As a result of 290 well workovers that were completed during the period,
we were able to maintain the current production levels.
Total net production attributable to Range during the period was 205,209 bbls, which in turn generated
revenue from sales of over US$13 million. We are confident that the production and cashflows from our
Trinidad operations will show significant growth during FY 2016. Our previously announced production target
of 1,000 bopd by the end of Q4 2015 remains unchanged.
Operational review – Trinidad
During the year, 11 development wells were drilled on the Company’s Morne Diablo and South Quarry
licences. Range and LandOcean have initiated a detailed analysis of the Company’s three producing fields
and the drilling results from the previous wells, aimed at improving the understanding of the structures and
reservoirs. Further studies are ongoing. In addition, a number of past performance issues were identified,
including a poor selection of previous drilling locations and targets, as well as engineering failures during
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CHIEF EXECUTIVE’S STATEMENT (continued)
drilling operations. The poor condition of the old rig fleet was also a major contributing factor for missed
production targets in the past.
Therefore, I firmly believe that the next financial year will show substantial improvement in operational
performance. With increased knowledge of the fields, we will be able to select the most prospective well
locations, and thus increase economics from the future drilled wells. The addition of new rigs will also be
pivotal to improving results and limiting the downtime of Range’s development and exploration operations.
Subsequent to the year-end, we finalised the initial 22 development and exploration well programme, with the
first well having spudded in September 2015. It is expected that the proposed wells will be drilled by the end
of Q1 2016. We are optimistic about this target, however the drilling schedule remains subject to a number of
variables, including availability of suitable rigs, arrival and commissioning of new rigs into RRDSL’s rig fleet,
various regulatory approvals, and the construction of drilling pads. RRDSL will also be required to recruit
additional drilling staff to operate the new rigs.
We have also commenced Electromagnetic Surveying in our fields. This technology is used to image shallow
resistive bodies and identify possible oil reservoirs at depths of 1,000 ft. or less, thus reducing exploration and
development risks at a relatively low cost with minimal environmental impact.
I am particularly excited about commencing the waterflood projects on our Beach Marcelle and Morne Diablo
fields during 2016. It is a large scale operation, which will be an essential component of our production
growth. Surface facility planning and scheduling for implementation are currently underway. It will take
approximately 6 months after injection commences until we can experience production growth, so we are likely
to see the rewards towards 2017.
Exploration
Exploration is critical to the growth of any oil & gas company, and we are delighted to have finalised the
agreements on two large and highly prospective blocks during the year – the Guayaguayare and St Mary’s
blocks. On the Guayaguayare block, we were also successfully awarded the operatorship and are finalising
the transfer of the full remaining interest of Niko in the block. Both blocks have exciting prospects and we
believe they will play a key role in our asset portfolio with plenty of newsflow to offer to our shareholders.
On the Guayaguayare block, we are looking to drill an initial two exploration wells (one shallow and one deep)
during 2015 and 2016. We have also commenced exploration programme on the St Mary’s block with the audit
of existing field infrastructure, facilities and wells currently underway. In addition, we provided the MEEA with
the required performance bond of US$8 million in support of the minimum work obligations on the licence.
Strong strategic partnership with LandOcean
We are delighted with our continued partnership with LandOcean, an emerging provider of a wide range of
technical and production services, which not only provides us with access to sophisticated oilfield services
provider but also additional financial backing and support.
During the previous financial year, we entered into an Integrated Master Services Agreement, whereby
LandOcean will act as the preferred oilfield services contractor to Range in Trinidad. Under the first US$5
million purchase order (which was entered into in June 2014), LandOcean provided geological and
engineering studies of secondary recovery projects, as follows:
• Screening study of all likely potential horizons and areas that could benefit from waterflooding in all
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three fields (Morne Diablo, South Quarry and Beach Marcelle);
Technical review of additional reserves and production rates that could be achieved by waterflooding
priority areas, including new well requirements and re-use / recompletion of existing wells.
Identification of water volume requirements for waterflooding;
• Cost estimates of subsurface and surface infrastructure requirements for each waterflooding project,
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plus screening economics of each project;
In collaboration with Range, identification of four priority waterflood projects (three in Beach
Marcelle, and one in Morne Diablo); and
Joint presentations to Petrotrin and the MEEA of detailed waterflooding plans for these four priority
projects.
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CHIEF EXECUTIVE’S STATEMENT (continued)
Subsequently, in December 2014, Range entered into the second purchase order of further US$50 million,
which covers a wide range of activities over the coming years.
During the year, LandOcean also acquired Range’s drilling business in Trinidad and added four brand new
drilling rigs to the fleet, which are expected to be available for operations from Q4 2015 to ramp up Range’s
drilling activities. The sale of the drilling business has allowed us to focus time and resources on efficiently
running Range’s upstream assets and growing production, as well as transferring operational performance
risk, improving financial stability and planning.
In addition, LandOcean agreed to provide Range with an extended 12 month credit facility on its services,
which allowed the Company to commence its drilling programme and make repayments from future cashflows.
We are very grateful to LandOcean for their support and will continue to work with them to achieve further cost
savings, optimisation and improved operational efficiencies.
Non-core assets
During the year, we continued with non-core asset rationalisation, and have completed sales of the Texas
assets, Citation Resources equity stake, and exit from Puntland. We believe that it was in the best interest of
all shareholders as these assets required imminent spending commitments which outweighed the potential
return. During the next financial year, we are aiming to dispose of our interests in Guatemala and Georgia,
and will keep our position in Colombia under review.
Financial review
As a result of the actions taken by the Board and management, the financial performance during the year has
substantially improved compared to the prior year. Despite the overall loss still recorded there is a notable,
positive trend in financial performance with particular improvement being seen in key areas between the first
and second half of the year:
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those related markets
The Group’s revenue was US$13.2 million (2014: US$21.2 million), a decrease of approximately
38%, whilst Group’s gross loss fell by 19% to US$2.9 million (2014: US$3.6 million). Revenues were
clearly affected from low oil prices during the year, with an average WTI realised price of
US$69.46/bbl (2014: US$101.33/bbl). However, the impact at an operating level was somewhat
negated due to the Supplemental Petroleum Tax (“SPT”) structure in Trinidad – at WTI oil prices
below US$50 per barrel no SPT is payable. The Company continues to monitor the oil price as well
as
future project and operational
development plans;
The Group’s loss after tax was reduced substantially compared to the prior year at US$30.3 million
(2014: US$102.5 million);
There were a number of exceptional and one-off charges during the year (including asset write-
downs and loss on disposal) and the Group’s net loss before tax from continuing operations prior to
any exceptional costs also showed a marked improvement on the prior year at US$20.4 million
(2014: US$40.5 million). There was an additional positive trend during the second half of the year
which reflected a loss of US$7.9 million (compared to US$12.5 million in the first half);
that could impact
the Company’s
• General and administrative costs overall decreased by 32% overall during the year and totalled
US$9.9 million (2014: US$14.5 million). Notable again is the positive trend during the second half of
the year when G&A costs were US$3.2 million (compared to US$6.7 million in the first half). This was
achieved as a result of cost cutting measures implemented by the Board;
The Group’s EBITDA also showed improvement half year on half year, falling from a loss of US$16.7
million in H1 to US$6.9 million in H2;
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• Net cash at 30 June 2015 was US$10.5 million (2014: US$3.0 million). This increase was largely a
result of new equity financing completed during the year;
• Cash outflow from operating activities was broadly stable on the prior year (despite reduction in
average oil price) at US$7.0 million (2014: outflow US$6.2 million); and
• Net cash inflow from investing activities was US$0.4 million (2014: outflow of US$8.1 million).
Current year inflow was primarily a result of asset sales offsetting the continued investment made in
Trinidad during the year.
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CHIEF EXECUTIVE’S STATEMENT (continued)
Summary
Last year we were focused on cutting costs across the Group and driving forward our development
programmes in Trinidad with the goal of achieving production and cashflows increase. Despite numerous
challenges that we’ve had to overcome, we believe that the next year we can realise on our potential and
unlock the true value of our assets. We have an extremely busy year ahead of us, with plenty of newsflow to
offer to our shareholders.
The Company has solid production assets with substantial reserves and potential to significantly increase
production; exploration upside; funding in place; and the team committed to growing shareholder value.
On behalf of the Board, management and employees, I would like to thank our loyal shareholders for their
support as we progress through the period of high activity. I am extremely grateful to be part of the
management team of the Company with such tremendous potential and look forward to focusing on valuable
returns for our shareholders.
Yours Faithfully
Yan Liu
Chief Executive
11
CORPORATE SOCIAL RESPONSIBILITY
Range is committed to operating in a socially responsible way with the highest standards of Business Ethics,
Environmental Awareness and Health & Safety by:
• Ensuring the health and safety of its employees and contractors;
• Preserving and protecting the environment; and
• Cultivating a harmonious relationship with the local communities and key stakeholders.
Health, Safety and Environment (“HSE”)
Range is committed to “Operational Excellence”, a core value that drives achievement of its sustainable
growth and financial performance. The Company’s vision of “Zero Harm” is that “no one gets hurt and nothing
gets harmed” and as a result HSE performance is a critical element of our Operational Excellence goal. It is,
therefore, the Policy of the Company, and far as is reasonably practicable, to:
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Implement and maintain HSE management systems to prevent accidents, occupational injuries,
illnesses and environmental incidence;
• Meet or exceed compliance with all applicable HSE laws and regulations;
• Ensure the provision and maintenance of a safe work environment, safe equipment and work
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procedures;
Foster a culture where all employees and contractors are held accountable for following all Company
Policies and Procedures;
• Provide appropriate training, re-training and supervision to maintain the competence levels of all
employees to safely perform their duties;
• Promote the development of a positive Health and Safety culture;
• Ensure timely investigation and reporting of all HSE related incidents; and
• Conduct regular reviews of the Company’s Policies and Procedures.
Concern for the environment is of utmost importance to Range where our policy is to minimise our potential
environmental impact by striving to:
• Protect the natural environment;
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Implement a cost effective waste and emissions management programme to prevent and control
pollution;
• Manage, monitor and communicate our environmental performance; and
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Integrate environmental considerations into all our business processes and strive for continuous
improvement.
Ethics and Principles
Range’s employees share a responsibility for ensuring that they conduct business in an open, honest, and
ethical manner and maintain the highest standards of integrity; and through corporate governance measure,
audit and publicly report performance on Corporate Social Responsibility programmes.
Anti-bribery & Corruption (“ABC”)
Range has a zero tolerance approach with respect to its Anti-bribery and Corruption policy, procedures and
implementation and complies with all applicable laws and regulations of the countries in which it operates. It is
the responsibility of all Range employees to ensure that none of Range’s businesses engage in practices
which infringe legal or regulatory requirements or which fall below the highest standards of ethical business
conduct.
Any Range employee engaging in business practices which infringe legal or regulatory requirements or fall
below the highest standards of ethical business conduct may be subject to disciplinary action which may lead
to dismissal and may face personal criminal or civil liability.
It is the responsibility of all Range employees to ensure that they report any infringement or suspected
infringement of legal or regulatory requirements or the highest standards of ethical business conduct to the
management of the Company.
12
CORPORATE SOCIAL RESPONSIBILITY (continued)
Social Responsibility & Community Programmes
Range’s aim has been to follow a collaborative approach to our local communities’ initiatives by:
• Striving to develop mutually beneficial relationships with its local communities through capacity
building, employment and other economic opportunities; and
• Supporting innovative programmes in local health, education, environment, and cultural activities.
Current Community Programmes
Range’s commitment to the local communities is evidenced by the Company’s ongoing support for the Morne
Diablo Funk-a-delic steel orchestra in Trinidad. First formed in 2004, the steel orchestra band consists of
around 40 local children between the ages of 6 and 18. Providing the children with an outlet for team building
and community participation, the programme provides music lessons up to three times a week, where they
learn how to play the steel pan (Trinidad and Tobago’s national musical instrument) and to read music. The
orchestra has performed at a number of ceremonies, including events hosted by the government of Trinidad
and Tobago.
13
CORPORATE GOVERNANCE
Principles of Best Practice Recommendations
Range has adopted appropriate systems of control and accountability as the basis for the administration of
corporate governance. The Board has adopted corporate governance policies and practices consistent with
the ASX Corporate Governance Council’s Principles of Good Corporate Governance and Best Practice
Recommendations (ASX Principles and Recommendations 3rd Edition), considered appropriate for the Group
of Range’s size and nature.
Where the Company’s corporate governance practices follow a recommendation, the Board has made
appropriate statements reporting on the adoption of the recommendation. Where, after due consideration, the
Company’s corporate governance practices depart from a recommendation, the Board has offered full
disclosure and reason for the adoption of its own practice.
Further information about the Company’s corporate governance practices may be found on the Company’s
website at www.rangeresources.co.uk, under the section marked “Corporate Governance”.
Best Practice Recommendation
Comment
1. Lay solid foundations for management and oversight
1.1 Disclose the respective roles and responsibilities of its board and management
and those matters expressly reserved to the board and those delegated to
management.
1.2 Undertake appropriate checks before appointing a person, or putting forward to
security holders a candidate for election, as a director and provide security
holders with all material information in its possession relevant to a decision on
whether or not to elect or re-elect a director.
1.3 Establish a written agreement with each director and senior executive setting
out the terms of their appointment.
1.4 The company secretary should be accountable directly to the board, through
the chair; on all matters to do with the proper functioning of the board.
1.5 Establish a diversity policy which includes requirements for the board or a
relevant committee of the board to set measurable objectives for achieving
gender diversity and to assess annually both the objectives and the entity’s
progress in achieving them. Disclose the gender diversity policy or a summary
and disclose at the end of each reporting period the measurable objectives for
achieving gender diversity set by the board or relevant committee of the board
in accordance with the entity’s diversity policy and its progress towards
achieving them, and either;
1. The respective proportions of men and women on the board, in senior
executive positions and across the whole organisation (including how the entity
has defined ‘senior executive’ for these purposes); or
2. If the entity is a ‘relevant employer under the Workplace Gender Equality
Act, the entity’s most recent ‘Gender Equality Indicators, as defined in and
published under the Act.
Satisfied. Refer to the
Board Charter in the
Corporate Governance
section on the
Company’s website.
Satisfied. Refer to
Remuneration and
Nomination Policy in the
Corporate Governance
section on the
Company’s website.
Satisfied. Refer to
Directors’ Report.
Satisfied. Refer to the
Board Charter in the
Corporate Governance
section on the
Company’s website.
Satisfied. Refer to
Diversity Policy in the
Corporate Governance
Section on the
Company’s website.
The Board has not
currently set any
measurable objectives
for achieving gender
diversity.
14
CORPORATE GOVERNANCE (continued)
1.6 Have and disclose a process for periodically evaluating the performance of the
board, its committees and individual directors and disclose, in relation to each
reporting period whether a performance evaluation was undertaken in the
reporting period in accordance with that process.
1.7 Have and disclose a process for periodically evaluating the performance of its
senior executives, and disclose, in relation to each reporting period whether a
performance evaluation was undertaken in the reporting period in accordance
with that process.
2. Structure the board to add value
2.1 The board should:
a) have a nomination committee which has at least three members a majority of
whom are independent directors and is chaired by an independent director and
disclose the charter of the committee, the members of the committee and as at
the end of each reporting period the number of times the committee met
throughout the period and the individual attendances of the members at those
meetings; or
b) if it does not have a nomination committee, disclose that fact and the
processes it employs to address board succession issues and to ensure that
the board has the appropriate balance of skills, knowledge, experience,
independence and diversity to enable it to discharge its duties and
responsibilities effectively.
2.2 Have and disclose a board skills matrix setting out the mix of skills and
diversity that the board currently has or it’s looking to achieve in its
membership.
2. Structure the board to add value continued
2.3 Disclose the names of the directors considered by the board to be independent
directors, if a director has an interest, position, association or relationship but
the board is of the opinion that it does not compromise the independence of the
director, the nature of the interest, position, association or relationship in
question and an explanation of why the board is of that opinion, and the length
of service of each director.
2.4 A majority of the board should be independent directors.
Not satisfied. The
Company is currently in
the process of
establishing a Board
evaluation programme.
Not satisfied. The
Company is currently in
the process of
establishing a senior
executive performance
evaluation programme.
Satisfied. Refer to
Remuneration and
Nomination Policy in the
Corporate Governance
section on the
Company’s website.
Not satisfied. The
Company is currently in
the process of
establishing a Board
skills matrix.
Satisfied. Refer to
Directors’ Report.
Satisfied. Refer to
Independence definition
in the Corporate
Governance section on
the Company’s website.
2.5 The chair of the board should be an independent director and, in particular,
Satisfied.
should not be the same person as the CEO of the entity.
2.6 Should establish a programme for inducting new directors and provide
appropriate professional development opportunities for directors to develop and
maintain their skills and knowledge needed to perform their role as directors
effectively.
Not satisfied. The
Company is currently in
the process of
establishing an
induction programme.
3. Act ethically and responsibly
15
CORPORATE GOVERNANCE (continued)
3.1 Establish a code of conduct for the directors, senior executives and employees
and disclose that code or a summary of it.
4. Safeguard integrity in corporate reporting
4.1 The board should establish an audit committee which;
a) has at least three members, all of whom are non-executive directors and
majority of whom are independent directors, and
b) is chaired by an independent director, who is not the chair of the board,
and disclose:
1) the charter of the committee;
2)the relevant qualifications and experience of the members of the committee;
and
3) in relation to each reporting period, the number of times the committee met
throughout the period and the individual attendances of the members at those
meetings; or
c) if it does not have an audit committee, disclose the fact and the processes it
employs that independently verify and safeguard the integrity of its corporate
governance reporting, including the processes for the appointment and removal
of the external auditor and the rotation of the audit engagement partner.
Satisfied. Refer to the
Code of Conduct in the
Corporate Governance
section on the
Company’s website.
Satisfied. The Board
has established an audit
and risk committee
made up of two Non-
Executive Directors and
the CFO.
Refer to the Audit and
Risk Committee in the
Corporate Governance
section on the
Company’s website.
4.2 The board before it approves the entity’s financial statements for a financial
period, receive from its CEO and CFO a declaration that, in their opinion, the
financial records of the entity have been properly maintained and that the
financial statements comply with the appropriate accounting standards and give
a true and fair view of the financial position and performance of the entity and
that the opinion has been formed on the basis of a sound system of risk
management and internal control which is operation effectively.
Satisfied.
4.3 The Company should ensure that its external auditor attends its AGM and is
available to answer questions from security holders relevant to the audit.
5. Make timely and balanced disclosure
5.1 Establish a written policy for compliance with the Continuous Disclosure
obligations under the Listing Rules and disclose the policy or a summary of it.
6. Respect the rights of security holders
6.1 The Company should provide information about itself and its governance to
investors via its website.
Satisfied. Refer to
Shareholder
Communications Policy
in the Corporate
Governance section on
the Company’s website.
Satisfied. Refer to
Continuous disclosure
policy in the Corporate
Governance section on
the Company’s website.
Satisfied. Refer to
Shareholder
Communications Policy
in the Corporate
Governance section on
the Company’s website.
16
CORPORATE GOVERNANCE (continued)
6.2 Design and implement an investor relations programme to facilitate effective
two-way communication with investors.
6.3 The Company should disclose the policies and processes it has in place
to facilitate and encourage participation at meetings of security holders.
6.4 Give its security holders the option to receive communications from, and
send communications to, the entity and its security registry electronically.
7. Recognise and manage risk
7.1 The board should;
a) have a committee or committees to oversee risk, each of which:
1) has at least three members, a majority of whom are independent directors;
and
2) is chaired by an independent director,
and disclose:
3) the charter of the committee;
4)the members of the committee; and
5)as at the end of each reporting period, the number of times the committee
met throughout the period and the individual attendances of the members at
those meetings; or
b)if it does not have a risk committee or committees that satisfy (a) above,
disclose that fact and the processes it employs for overseeing the entity’s risk
management framework.
Satisfied. Refer to
Shareholder
Communications Policy
in the Corporate
Governance section on
the Company’s website.
Satisfied. Refer to
Shareholder
Communications Policy
in the Corporate
Governance section on
the Company’s website.
Satisfied. Refer to
Shareholder
Communications Policy
in the Corporate
Governance section on
the Company’s website.
Satisfied. The Board
has established an audit
and risk committee
made up of two Non-
Executive Directors and
the CFO.
Refer to Audit and Risk
Committee in the
Corporate Governance
section on the
Company’s website.
7.2 The board or committee of the board should:
a) review the entity’s risk management framework at least annually to satisfy
itself that it continues to be sound: and
b) disclose, in relation to each reporting period, whether such a review has
taken place.
7.3 The Company should disclose;
a) If it has an internal audit function, how the function is structured and what
role it performs; or
b) if it does not have an internal audit function, that fact and the processesit
employs for evaluating and continually improving the effectiveness of its risk
management and internal control processes.
Not satisfied. The
Company is currently in
the process of
establishing a risk
management
framework.
Not satisfied. The
Company is currently in
the process of
establishing an internal
audit function.
17
CORPORATE GOVERNANCE (continued)
7.4 To disclose whether it has any material exposure to economic, environmental
and social sustainability risks and, if it does, how it manages or intends to
manage those risks.
8. Remunerate fairly and responsibly
8.1 The board should;
a) have a remuneration committee which:
1) has at least three members, a majority of whom are independent directors;
and
2) is chaired by an independent director, and disclose:
3) the charter of the committee;
4) the members of the committee; and
5) as at the end of each reporting period, the number of times the committee
met throughout the period and the individual attendances of the members at
those meetings; or
b) if it does not have a remuneration committee, disclose that fact and the
processes it employs for setting the level and composition of remuneration for
directors and senior executives and ensuring that such remuneration is
appropriate and not excessive.
8.2 Separately disclose its policies and practices regarding the remuneration of
non-executive directors and the remuneration of executive directors and other
senior executives.
8.3 A company which has an equity-based remuneration scheme should;
a) have a policy on whether participants are permitted to enter into transactions
(whether through the use of derivatives or otherwise) which limit the economic
risk of participating in the scheme; and
b) disclose that policy or summary of it.
Not satisfied. The
Company is currently in
the process of
establishing a risk
management framework
which will incorporate
economic,
environmental and
social sustainability
risks and how it intends
to manage the risks.
Satisfied. Refer to
Remuneration and
Nomination Policy in the
Corporate Governance
section on the
Company’s website.
Satisfied. Refer to
Remuneration and
Nomination Policy in the
Corporate Governance
section on the
Company’s website.
N/A – the Company
does not currently have
an equity-based
remuneration scheme.
BOARD OF DIRECTORS
Role and Responsibilities of the Board
The Board of Directors is responsible for the overall strategy, governance and performance of Range and its
controlled entities. The Board is responsible for promoting the success of the Company through its key
functions of overseeing the management of the Company, providing overall corporate governance of the
Company, monitoring the financial performance of the Company, engaging appropriate management commensurate
with the Company’s structure and objectives, involvement in the development of corporate strategy and performance
objectives, and reviewing, ratifying and monitoring systems of risk management and internal control, codes of conduct
and legal compliance.
18
CORPORATE GOVERNANCE (continued)
The Board’s Relationship with Management
The role of management is to support the Chief Executive Officer and implement the running of the general
operations and financial business of the Company, in accordance with the delegated authority of the Board. The
Board shall delegate responsibility for the day-to-day operations and administration of the Company to the Chief
Executive Officer. In addition to formal reporting structures, members of the Board are encouraged to have direct
communications with management and other employees within the Group to facilitate the carrying out of their duties as
Directors.
The Company Secretary is accountable directly to the Board, through the Chairman, on all matters to do with the
proper functioning of the Board. All directors have direct access to the Company Secretary.
The Company’s Board Charter is available on the Company’s website www.rangeresources.co.uk.
Composition of the Board
The composition of the Board is reviewed regularly to ensure the appropriate mix of skills and expertise is
present to facilitate successful strategic direction.
In appointing new members to the Board, consideration is given to the ability of the appointee to contribute to the
ongoing effectiveness of the Board, to exercise sound business judgement, to commit the necessary time to fulfil the
requirements of the role effectively and to contribute to the development of the strategic direction of the Company.
Where practical, the majority of the Board will be comprised of independent Directors.
The Company intends to establish a board skills matrix setting out the mix of skills and diversity during the current
financial year.
Definition of an Independent Director
The Board has accepted the following definition of an independent Director:
An independent Director is a non-executive Director (ie is not a member of management) and:
• Holds less than 5% of the voting shares of the Company and is not an officer of, or otherwise associated
directly or indirectly with, a shareholder of more than 5% of the voting shares of the Company;
• Within the last three years has not been employed in an executive capacity by the Company or another
group member, or been a Director after ceasing to hold any such employment;
• Within the last three years has not been a partner, director or senior employee of a material professional
adviser or a material consultant to the Company or another group member, or an employee materially
associated with the service provided;
• Within the last three years has not been in a material business relationship, is not a material supplier or
customer of the Company or other group member, or an officer of or otherwise associated directly or
indirectly with someone with such a relationship;
• Has no material contractual relationship with the Company or another group member other than as a
Director of the Company;
• Has close family ties with any person who falls within any of the categories described above;
• Has not served on the board for a period which could, or could reasonably be perceived to, materially
•
interfere with the Director’s ability to act in the best interests of the Company; and
Is free from any interest and any business or other relationship which could, or could reasonably be
perceived to, materially interfere with the Director’s ability to act in the best interests of the Company.
The materiality thresholds are assessed on a case-by-case basis, taking into account the relevant Director’s specific
circumstances, rather than referring to a general materiality threshold.
Term of Office
Under the Company's Constitution, the minimum number of Directors is three. At each Annual General Meeting, one
third of the Directors (excluding the CEO) must resign, with Directors resigning by rotation based on the date of their
appointment. Directors resigning by rotation may offer themselves for re-election.
19
CORPORATE GOVERNANCE (continued)
Independent Professional Advice and Access to Company Information
Each Director has the right of access to all relevant Company information and to the Company’s Executives and, subject
to prior consultation with the Chairperson, may seek independent professional advice at the Company’s expense. A
copy of advice received by the Director is made available to all other members of the Board.
BOARD COMMITTEES
Remuneration and Nomination Committee
The Board has established a Remuneration and Nomination Committee. The primary purpose of the Committee is to
support and advise the Board in fulfilling its responsibilities to shareholders by:
• Reviewing and approving the executive remuneration policy to enable the Company to attract and retain
executives and Directors who will create value for shareholders;
• Ensuring that the executive remuneration policy demonstrates a clear relationship between key executive
performance and remuneration;
• Recommending to the Board the remuneration of executive Directors;
•
Fairly and responsibly rewarding executives based on the performance of the Group, the performance of the
executive and the prevailing remuneration expectations in the market;
• Reviewing the Company’s recruitment, retention and termination policies and procedures for senior
management;
• Reviewing and approving the remuneration of Director reports to the Chief Executive Officer, and as
appropriate other senior executives; and
• Reviewing and approving any equity based plans and other incentive schemes.
Range’s Remuneration and Nomination Committee consists of the following members:
• Mr David Chen, Non-executive Chairman (Chairman of the committee)
• Ms Juan Wang, Non-executive Director (Member of the committee)
• Mr Zhiwei Gu, Non-executive Director (Member of the committee)
The Committee held 2 meeting during the period.
The Company’s Remuneration and Nomination Committee Charter is available on the Company’s website at
www.rangeresources.co.uk
Audit and Risk Committee
The Board has established an Audit and Risk Committee. The primary purpose of the Committee is to assist the Board
in fulfilling its statutory and fiduciary responsibilities relating to:
•
The quality and integrity of the Company’s financial statements, accounting policies and financial reporting
and disclosure practices;
• Compliance with all applicable laws, regulations and company policy;
•
The effectiveness and adequacy of internal control processes;
•
The performance of the Company’s external auditors and their appointment and removal;
•
The independence of the external auditor and the rotation of the lead engagement partner;
•
The identification and management of business, economic, environmental and social sustainability risks; and
•
The review of the Company’s risk management framework at least annually to satisfy itself that it continues
to be sound.
Range’s Audit and Risk Committee consists of the following members:
• Mr Zhiwei Gu, Non-executive Director (Chairman of the committee)
• Mr David Chen, Non-executive Chairman (Member of the committee)
• Mr Nick Beattie, Chief Financial Officer (Member of the committee)
The Committee held 2 meetings during the period.
The Company’s Audit and Risk Committee Charter
www.rangeresources.co.uk.
is available on
the Company’s website at
20
CORPORATE GOVERNANCE (continued)
Reserves Committee
The Board has established a Reserves Committee. The primary purpose of the Committee is to support and
advise the Board in:
• Reviewing the Company’s procedures relating to the disclosure of information with respect to oil and gas
activities; and
• Meeting with management and the qualified reserves evaluator or auditor to review the reserves data or
report of the qualified reserves evaluator or auditor.
Range’s Reserves Committee consists of the following members:
• Mr Yan Liu, Executive Director (Chairman of the committee)
• Mr Nick Beattie, Chief Financial Officer (Member of the committee)
• Mr David Chen, Non-executive Chairman (Member of the committee)
The Committee held 1 meeting during the period.
The Company’s Reserves Committee Charter is available on the Company’s website at www.rangeresources.co.uk
Performance Evaluation
The Remuneration and Nomination Committee will arrange a performance evaluation of the Board, its Committees,
individual Directors and senior executives on an annual basis. To assist in this process an independent advisor may be
used.
The Remuneration and Nomination Committee will conduct an annual review of the role of the Board, assess the
performance of the Board over the previous 12 months and examine ways of assisting the Board in performing its
duties more effectively.
The review will include:
• Comparing the performance of the Board with the requirements of its Charter;
• Examination of the Board’s interaction with management;
•
The nature of information provided to the Board by management; and
• Management’s performance in assisting the Board to meet its objectives.
A similar review will be conducted for each Committee by the Board with the aim of assessing the performance of each
Committee and identifying areas where improvements can be made.
The Remuneration and Nomination Committee will oversee the performance evaluation of the executive team. This
evaluation is based on specific criteria, including the business performance of the Company and its subsidiaries,
whether strategic objectives are being achieved and the development of management and personnel.
A review was undertaken on 17 October 2014.
Code of Conduct
The Company has developed a Code of Conduct (the Code) which has been fully endorsed by the Board and
applies to all Directors and employees. The Code is regularly reviewed and updated as necessary to ensure it
reflects the highest standards of behaviour and professionalism and the practices necessary to maintain
confidence in the Company’s integrity. The purpose of the Code is to provide a framework for decisions and actions in
relation to ethical conduct in employment. It underpins the Company’s commitment to integrity and fair dealing in its
business affairs and to a duty of care to all employees, clients and stakeholders. The Code can be found in the
corporate governance information section of the Company’s website at www.rangeresources.co.uk.
21
CORPORATE GOVERNANCE (continued)
Conflict of Interest
In accordance with the Corporations Act 2001 and the Company’s constitution, Directors must keep the Board
advised on an ongoing basis of any interest that could potentially conflict with those of the Company. Where
the Board believes a significant conflict exists, the Director concerned does not receive the relevant Board
papers and is not present at the Board meeting whilst the item is considered. Details of Directors related entity
transactions with the Company are set out in the related parties note in the financial statements.
Diversity
The Company and all its related bodies are committed to workplace diversity. The Company recognises the
benefits arising from employee and Board diversity, including a broader pool of high quality employees,
improving employee retention, accessing different perspectives and ideas and benefiting from all available
talent. Diversity includes, but is not limited to, gender, age, ethnicity and cultural background. The Board
believes that the Company has diverse work force at all levels, however at this stage the Board believes that
there is no requirement to set a measurable objective in relation to gender diversity.
The Company’s diversity policy can be found on the Company’s website www.rangeresources.co.uk.
Trading in the Company’s Securities by Directors, Officers and Employees
The Board has adopted a specific trading policy in relation to all Directors of the Company and all employees
of the Range Group (including all full and part time staff and contractors). These persons are prohibited from
trading in the Company’s shares, options and other securities if they are in possession of price-sensitive
information.
The Company's Security Trading Policy is provided to each new employee as part of their induction training. The
Directors are satisfied that the Company has complied with its policies on ethical standards, including trading in
securities.
The Company’s trading policy was last updated on 12 August 2015 and a copy can be found on the Company’s
website www.rangeresources.co.uk.
Continuous Disclosure
The Company must comply with continuous disclosure requirements arising from legislation and the ASX and
AIM Listing Rules.
The general rule, in accordance with ASX Listing Rule 3.1, is that once the Company becomes aware of any
information concerning it that a reasonable person would expect to have a material effect on the price of value of
the Company’s securities, the Company must immediately disclose that information to the ASX.
AIM Rule 10 states that information must be published on AIM no later than it is published elsewhere. An AIM company
must take reasonable care to ensure that any information it notifies is not misleading, false or deceptive and does not
omit anything that is likely to affect the import of such information. It will be presumed that information notified to a
Regulatory Information Service is required by these rules or other legal regulatory requirement unless otherwise
designated.
AIM Rule 11 states that an AIM company must issue notification without delay of any new developments which are not
public knowledge concerning a change in:
•
•
•
•
Its financial condition;
Its sphere of activity;
The performance of its business; or
Its expectation of its performance, which, if made public, would be likely to lead to a substantial movement in
the price of its AIM securities.
The Company has in place a written policy on information disclosure and relevant procedures, which can be accessed
at www.rangeresources.co.uk.
22
CORPORATE GOVERNANCE (continued)
Shareholder Communications Strategy
The Company places significant importance on effective communication with shareholders. Information is
communicated to shareholders through the annual and half yearly financial reports, quarterly reports on
activities, announcements through the ASX and AIM, and the media, on the Company’s web site and through
the Chairman’s address at the annual general meeting. After the Annual General Meeting, Chairman of the
meeting is available to meet with any shareholders and answer questions. Shareholders are encouraged to
contact Range and to submit any questions via email admin@rangeresources.co.uk.
As part of the Company’s developing investor relations program, Shareholders can register on the Company’s website
to receive email notifications of when an announcement is made by the Company to the ASX and AIM, including the
release of the annual report, half yearly reports and quarterly reports. Links are made available to the Company’s
website on which all information provided to the ASX and AIM is immediately posted.
The Company will, wherever practicable, take advantage of new technologies that provide greater opportunities for more
effective communications with shareholders.
Range ensures that its external auditor is present at all Annual General Meetings to enable shareholders to ask
questions relevant to the audit directly to the auditor.
The Company’s Shareholder Communications Strategy can be accessed
www.rangeresources.co.uk.
from
the Company’s website
Company Website
The Company has made available details of all its corporate governance principles, which can be found in the
corporate governance information section of the Company’s website at www.rangeresources.co.uk.
23
DIRECTORS’ REPORT
The Directors of Range Resources Limited (“Range” or “the Company”) and the entities it controls (together, the
“Group”) present the financial report for the year ended 30 June 2015.
PRINCIPAL ACTIVITIES
The principal activity of the Group during the financial year was oil and gas exploration, development and production in
Trinidad. The Company holds further interests in non-core oil and gas projects in Georgia, Guatemala and Colombia.
The Company’s strategy is to create sustainable shareholder value by growing oil production and developing
discovered resources from its core assets, while rationalising non-core assets within the portfolio.
FINANCIAL RESULTS
•
•
•
The Consolidated Statement of Profit or Loss and Other Comprehensive Income for the financial year shows
a net loss attributable to owners of US$30,279,054 (2014: net loss of US$102,541,990).
The Group’s revenue was US$13,152,954 (2014: US$21,185,745). The decrease of US$8,032,791 was
primarily due to lower oil prices in the 2015 financial year.
The net loss after tax from continuing operations was US$22,581,895 (2014: US$59,096,590). Decrease in
loss primarily due to large numbers of write offs in the prior year.
• Net cash outflow from operating activities for the period was US$6,955,264 (2014: outflow US$6,221,781).
• General and administrative costs overall decreased by US$4,537,360
to US$9,948,494
(2014:
•
US$14,485,854) as a result of cost cutting measures implemented across the Group.
The net assets of the Group decreased by US$14,271,807 to US$95,023,456 (2014: US$109,295,263). This
decrease is primarily due to impairments made in the year to the Group’s Georgian assets (impairment of
US$5,000,000) and Guatemalan assets (impairment of US$1,779,476), and other losses made by the Group.
DIVIDENDS
No dividends have been declared, provided for or paid in respect of the financial year ended 30 June 2015 (2014: Nil).
OPERATING ACTIVITIES
Corporate
Directorate and management changes
During the Annual General Meeting of the Company held on 28 November 2014, a number of Directors were not re-
elected to the Company’s Board by the shareholders, namely Mr Rory Scott Russell, Mr Graham Lyon, Dr Christian
Bukovics and Mr Marcus Edwards-Jones. Sir Sam Jonah, Non-Executive Chairman, resigned from the Board of the
Company effective from the conclusion of the Company’s Annual General Meeting. Subsequently, Mr David Riekie and
Mr Ian Olson also resigned from the Board of the Company on 11 December 2014.
Following these changes, four new Director appointments have been made to the Company’s Board, which now
comprises of Mr David Yu Chen, Mr Yan Liu, Mr Zhiwei (Kerry) Gu, and Ms Juan (Kiki) Wang.
The Company also appointed Mr Nick Beattie and Ms Sara Kelly as Joint Company Secretary.
In addition, subsequent to the period end, the Company appointed Mr Lijun Xiu as Trinidad Deputy General Manager.
Mr Xiu has a long and distinguished geological career of over 30 years working for Jilin Oilfield Research Institute of
Petroleum Exploration & Development (a division of China National Petroleum Corporation). Mr Xiu has extensive
experience in oilfield exploration and development planning, drilling design, research on geological conditions for oil
and gas accumulations and target selection, evaluation of oil reservoir properties and productivity construction,
evaluation of well logging, and assessment of hydrocarbon reserves.
Mr Yan Liu, Chief Executive Officer of the Company, extended his role to that of Trinidad General Manager, focusing
on managing the Trinidad business, growing production and driving profitability. Mr Walter Cukavac (previously,
Trinidad Chief Operations Officer) was appointed as Trinidad Director of Operations, responsible for overseeing the
24
DIRECTORS’ REPORT (continued)
Health, Safety and Environment functions, government communications, managing production, and other oilfield
support activities.
Equity Financing with Sibo
During the period, Range agreed an equity funding package with Beijing Sibo Investment Management LP (“Sibo”) for
US$30 million, which completed subsequent to the year end. As per the terms of the subscription agreement, Range
issued approximately 2,450 million new ordinary fully paid shares of the Company to Sibo at a subscription price of
£0.008 per share. The Company also issued 194,585,862 unlisted warrants with an exercise price of £0.01 and
172,557,274 unlisted warrants with an exercise price of £0.02 to Sibo. All warrants have an expiry date of 3 September
2019.
Range’s Directors and management also subscribed for ordinary shares in an amount of US$0.3 million in cash. Range
issued 25 million new Shares to Directors and management at a subscription price of £0.008 per Share.
The financing with Sibo supersedes the previously contemplated financing with Core Capital Management Co., Ltd,
which was terminated during the period.
Supplier Financing with LandOcean
During the period, Range and LandOcean reached an agreement whereby LandOcean provide extended credit terms
of 12 months on drilling related invoices payable to Range Resources Drilling Services Limited (“RRDSL”). This has
material cashflow benefit to Range and importantly allows the Company to progress with its planned drilling
programme. Interest will be payable by Range on any third party costs contained within the invoices at the rate of 10%
per annum.
Loan Financing with Lind
During the period, Range announced that it had signed a loan agreement for up to US$15 million in medium-term
financing with Lind Asset Management, LLC, (“Lind”). Range received advances totalling US$5,500,000 (minus certain
fees) pursuant to the agreement. Range made a repayment of US$562,500 (paid by way of the issue of shares to
Lind) in November 2014.
On 16 February 2015, Range received a statutory demand from Lind demanding repayment of approximately US$7.2
million that Lind alleges is due and payable. Subsequently, Range filed an application to the Supreme Court of Western
Australia to set aside the statutory demand.
Subsequent to the period end, the Company paid US$5 million to Lind.
US$50 Million Trade Financing Package with Sinosure
During the period, Range announced that LandOcean in conjunction with Sinosure are looking to provide Range with
up to US$50 million by way of a credit facility of two years to fund the development programme in Trinidad principally
related to the waterflood programme. The facility is subject to final approvals by Sinosure, and payment of a security
deposit of US$7.5 million by Range. The security deposit shall be refunded to the Company upon expiry or termination
of the second purchase order and the Company's satisfaction of its obligations to pay all accrued interest on the
financing facility at such time. The financing is subject to interest at 10% per annum and repayments will be due 720
days after each drawdown on the financing.
International Petroleum Loan Settlement
During the period, and in line with a loan settlement agreement, International Petroleum Ltd (“IOP”) made a cash
payment of US$500,000 to Range and all other outstanding monies have been converted into 147,803,270 ordinary
shares of IOP. Following conversion, Range holds approximately 9% of the enlarged share capital of IOP. In addition,
IOP issued 5 million unlisted options to Range exercisable at AU$0.06 per option on or before 2 October 2016. At the
date of this report, IOP shares remain suspended from trading on NSX.
Operations
TRINIDAD
25
DIRECTORS’ REPORT (continued)
The Company has the largest private onshore acreage in Trinidad with a 100% interest in three onshore production
licences – Morne Diablo, South Quarry and Beach Marcelle, as well as interests in two exploration blocks – St Mary’s
and Guayaguayare.
Production
The Company’s oil and gas production for the period in Trinidad was 205,209 bbls (average of 562 bopd) net to Range.
Production during the year was broadly unchanged from the previous year (2014: average of 573 bopd). There was a
limited number of development wells drilled during the year, due to failures of old equipment and rigs, which prevented
the Company from running its drilling campaign efficiently. The Company believes that the financial year of 2016 should
show substantial improvement in operational performance. The access to four brand new drilling rigs during 2H 2015,
will be pivotal to improving capabilities and limiting the downtime of Range’s development and exploration drilling.
Sale of Range Resources Drilling Services Limited
Following a strategic review, management decided to realign its corporate strategy in order to solely focus its time and
resources on growing its E&P business. As a result, the Company completed the sale of its drilling business RRDSL to
LandOcean. RRDSL will continue to provide full oilfield operations services to Range in Trinidad. Range and
LandOcean have finalised the Trinidad Drilling Contract agreement, as an extension of the Integrated Master Services
Agreement with services to be provided on a turnkey basis and priced in line with market rates in Trinidad, to be
reviewed periodically by both parties.
New Drilling Rig Fleet
Following completion of RRDSL sale, LandOcean added four new drilling rigs to the existing fleet. The first new drilling
rig arrived in Trinidad in August 2015 and is expected to be available for drilling from October 2015, subject to a
number of conditions, including various government and regulatory approvals and availability of suitable drilling staff to
operate the rigs. This large rig with a drilling capability of 13,000 ft. (4,000 m) will be utilised to drill deeper, previously
inaccessible exploration targets on the Company’s licences in Trinidad.
The other three new drilling rigs with drilling capabilities of 6,500 ft. (2,000 m), 4,900 ft. (1,500 m) and 3,200 ft. (1,000
m) are also on route to Trinidad, expected to arrive by the end of September 2015 and be available for drilling from
November 2015.
Development Programme
During the year, the Company drilled the following development wells:
Item Well
1
2
3
4
5
6
7
8
9
10
11
QUN 153
QUN 154
QUN 155
QUN 156
QUN 157
QUN 158
1 PS 1505
QU 454
QU 455
QU 454 ST
QU 456
Field
Morne Diablo
Morne Diablo
Morne Diablo
Morne Diablo
Morne Diablo
Morne Diablo
South Quarry
South Quarry
South Quarry
South Quarry
South Quarry
Total Depth (ft)
1,111
2,300
800
800
2,301
2,000
800
2,000
890
1,440
2,002
Status
Pumping
Flowing
Pumping
Pumping
Flowing
To be re-drilled during Q4 2015
100% water
Well side-tracked (refer QU 454 ST)
Previously producing, now capped
Capped
Capped
Subsequent to year-end, the Company finalised an initial 22 development and exploration well programme, with drilling
operations underway.
In addition, the Company commenced Electromagnetic Surveying in its fields. This technology is used to image shallow
resistive bodies and identify possible oil reservoirs at depths of 1,000 ft. or less, thus reducing exploration and
development risks at a relatively low cost with minimal environmental impact.
26
DIRECTORS’ REPORT (continued)
Waterflood Programmes
During the year, the Company has been evaluating multiple waterflood blocks in the Beach Marcelle field, two blocks in
the South Quarry field, and expansion of the existing pilot project on Morne Diablo field.
It has been concluded that Phase 1 waterflooding on Beach Marcelle field will comprise the South East, North East and
South West blocks, plus parts of the North West block previously partially waterflooded by Texaco (subject to the
relevant approvals).
Range applied for the relevant approvals for Beach Marcelle waterflooding during September 2015. Once all approvals
are obtained, implementation of water injection is expected to commence approximately five months thereafter. In the
meantime, surface facility planning and scheduling for implementation are underway.
On Morne Diablo field, LandOcean completed a review of the previous plans for expansion of the existing pilot
waterflood scheme, and suggested changes to the waterflooding pattern which could enhance incremental production
and recovery from the project. Range applied for the relevant approvals for revised Morne Diablo waterflooding during
August 2015. Once all approvals are obtained, implementation of water injection is expected to commence
approximately four months thereafter. In the meantime, surface facility planning and scheduling for implementation are
underway.
Exploration Programmes
Guayaguayare Block
Subsequent to the period end, Range obtained a consent from the Minister of Energy and Energy Affairs of Trinidad
and Tobago and the other partners in the block, Niko Resources Ltd. (“Niko”) and Petrotrin, for the assignment of
Niko’s partial interest as contemplated in the original farm-in transaction entered into in December 2013. Therefore,
Range holds a 40% interest in the Deep Production Sharing Contract (“PSC”) and a 32.5% interest in the Shallow PSC.
In addition, Range has been appointed as the Operator of the block.
Subsequent to the period end, Range signed an amendment agreement to acquire the full remaining interest of Niko in
the block. Range has applied for the approvals to transfer the remaining interest and for the extension of the PSCs.
Following completion of the agreement, Range will hold an 80% interest in the Deep PSC and a 65% interest in the
Shallow PSC.
The Company continued to prepare for spudding of its first exploration well, Canari North, located on the
Guayaguayare block. The Canari North well will be the first exploration well to be drilled by Range in Trinidad, and any
success with the well is expected to de-risk the Moruga sub-basin and could result in material potential upside in the
Guayaguayare block with multiple follow-on prospects and leads to be tested by further exploration drilling. The
planned drilling programme is for a vertical well to be drilled to a target depth of 5,000 ft.
The second commitment well, the Guayaguayare deep well, is expected to be drilled during 2016.
St Mary’s Block
During the period, the Company successfully signed the Exploration & Production licence and negotiated the Joint
Operating Agreement on the new St Mary’s block. The work programme on the block has commenced with the audit of
existing field infrastructure, facilities and wells underway. Range has committed to drilling four exploration wells,
shooting 160km of 2D seismic and 60km2 of 3D seismic, along with various other technical studies before the end of
2018.
Subsequent to the period end, Range used US$8 million of the Sibo proceeds to provide the Ministry of Energy and
Energy Affairs with the required performance bond in support of the minimum work obligations on the St Mary’s licence.
NON-CORE ASSETS
In line with the Company’s stated strategy of non-core asset rationalisation and continued focus on production growth
from the core assets in Trinidad, the Company continued with non-core assets disposals during the period.
27
DIRECTORS’ REPORT (continued)
Puntland
During the period, the Joint Venture Operator, Africa Energy Corp. provided notice to the Puntland State of Somalia
advising of its intention to withdraw from the January 2007 production sharing agreements (“PSAs”) in respect of the
Nugaal Block and the Dharoor Block. Range also confirmed that it would withdraw from these blocks.
The principal reason for the decision was the uncertainty of the current political climate in Somalia, especially in respect
of the disagreement between the Federal Government of Somalia and the regional government of Puntland, Somalia
over the legitimacy of the PSAs, and potential territorial claims on the Nugaal Block.
Georgia
During the period, the Ministry of Energy of Georgia formally notified the Operator of the Georgian project, Strait Oil &
Gas (“SOG”: in which Range holds a 45% interest) that the PSC over Block VIb was terminated. This notification was
solely in respect of Block VIb and does not affect the validity of Block VIa. The Company continues to pursue a disposal
of its shareholding in SOG (which holds interests in Block Via).
Texas, USA
During the period, the Company completed the sale of its interests in the East Clarksville and North Chapman Ranch
projects in Texas to Citation Resources Limited (“Citation”). Citation is an ASX-listed oil and gas company, which
together with Range holds interests in oil production and exploration assets in Guatemala.
As part of the sales proceeds Range has received a AU$500,000 cash payment, a carry on the Guatemalan assets to
the value of AU$830,000, a forgiveness on monies owed by Range to Citation to the value of AU$189,000 and 200
million new ordinary shares in Citation (which were later sold by Range – please refer below).
Guatemala
During the period, the Company disposed of its entire equity holding in Citation by way of an on market sale of
2,209,585 ordinary fully paid shares in Citation at an average price of AU$0.11 per share, which realised approximately
AU$0.22 million in cash to Range. The proceeds represented a 10% premium to the assumed value from the Texas
disposal.
The Company continues to explore potential disposal options for its 20% interest in the Guatemalan Project.
Colombia
Range holds a 10% fully carried interest in three blocks in Colombia; PUT-5, VMM-7, and VSM-1. The blocks are
operated by Optima Oil Corp (“Optima”), a private company registered in Panama. The three blocks are found in the
mature basins of the Putumayo and Magdalena Valley with hydrocarbon accumulations in the vicinity of each block.
The initial exploration term expires in December 2015 during which time 2D seismic and one exploration well will need
to be drilled on each block. The Operator continues its discussions with Agencia Nacional de Hidrocarburos with
regards to the minimum work obligations on the three exploration blocks and the provision of guarantees.
PRINCIPAL RISKS AND UNCERTAINTIES
Range continually monitors the effectiveness of the Company’s risk management, internal compliance and control
systems. The Board has identified the following principal business risks and adopted mitigating strategies as described
below:
28
DIRECTORS’ REPORT (continued)
Risk
Description
Mitigation
and
Exploration
development
activities
HSE
HR
There is a significant element of technical
risk in exploring for and developing oil and
gas fields.
inherently
are
activities
Exploration
to
uncertain
their outcome. Failure
discover and develop hydrocarbons
in
commercially viable quantities could have
the
a material
Company’s business.
adverse
effect
on
in
Exploration, development and production
of oil and gas involve risks which may
impact the health and safety of personnel,
the community and the environment.
Failure to manage these risks could result
in
life, damage or
destruction of property, and damage to the
environment.
injury or
loss of
to
implement
Key personnel and positions are required
the Company’s
in order
the
strategy. The
risk occurs when
appropriate personnel are difficult
to
recruit and retain.
Access to funding
Range’s ability to explore for and develop
oil and gas reserves is dependent on its
ability to generate and otherwise access
capital to fund these activities.
Commodity
change
price
revenues, profitability,
The Company’s
rate of growth are
cash
flows and
significantly
impacted by prevailing oil
prices. Crude prices are affected by
numerous and complex worldwide factors
beyond Range’s control.
Exchange
fluctuations
rate
is exposed
financial
The Company
market volatility and fluctuation in various
foreign exchange rates.
to
to
the quality of
continuously
The Company aims
improve
its operations
through rigorous reviews. Technical work
to ensure each
processes are used
opportunity has been thoroughly evaluated
before investment decisions are made.
Range
its
lowering
focused on
exploration risk by applying disciplined
capital allocation processes and investing
in technologies such as seismic.
is
policies,
cultivating
committed
Range is committed to maintaining robust
an
and
HSE
organizational
to
culture
superior HSE performance.
The Company maintains strict reporting
requirements in respect of any incidents,
hazards
Training,
procedures and competency are performed
throughout the organisation.
Appropriate insurances are in place.
near misses.
or
The Company identifies the key positions
the
and personnel and ensures
incentive package offered reflects the key
needs of the business.
that
reviews and approves
The Board
the
allocation of cash resources via the annual
budget. The Board also considers longer
term cash forecasts to ensure sufficient
funds to meet its goals. Range continues to
assess
funding needs and
long-term
manage capital efficiently.
Range does not currently hedge its oil
price exposure.
Price hedging arrangements would be
for
implemented
financial
to mitigate
commodity price risks.
if deemed appropriate
planning
and
Range does not currently hedge its US
Dollar exposure.
Given
the proportion of development
capital expenditure and operating costs
incurred in currencies other than the US
Dollar,
reviews
potential hedges and will execute hedges if
necessary to mitigate foreign exchange
rate risk.
the Company
routinely
29
DIRECTORS’ REPORT (continued)
Political, economic,
and
regulatory
risks
substantial
of Range’s
amount
A
properties and operations are located in
the Group’s
Trinidad and Tobago and
results
financial
condition are affected by policy, taxation
economic
and
developments in or affecting Trinidad and
Tobago.
operations
political
other
and
or
of
Range continuously monitors the political,
economic, and regulatory environments in
which it operates and actively cooperates
with
the government of Trinidad and
Tobago on strategies that might impact the
Company.
DIRECTORS
The names of the directors in office and at any time during or since the end of the year are:
Non-Executive Chairman
Non-Executive Director
Executive Director
Non-Executive Director
Non-Executive Chairman
Executive Director
Mr David Yu Chen
Ms Juan Wang
Mr Yan Liu
Mr Zhiwei Gu
Sir Samuel Jonah
Mr Rory Scott Russell
Mr Marcus Edwards-Jones Non-Executive Director
Non-Executive Director
Dr Christian Bukovics
Non-Executive Director
Mr Graham Lyon
Non-Executive Director
Mr David Riekie
Executive Director
Mr Ian Macliver
Mr Ian Olson
Non-Executive Director
Non-Executive Director
appointed 30 November 2014
appointed 30 November 2014
appointed 11 December 2014
appointed 11 December 2014
resigned 28 November 2014
appointed 3 Feb 2014, not re-elected 28 November 2014
not re-elected 28 November 2014
appointed 3 Feb 2014, not re-elected 28 November 2014
appointed 3 Feb 2014, not re-elected 28 November 2014
appointed 27 Jun 2014
appointed 4 December 2014, resigned 11 December
2014
resigned 13 Aug 2014
appointed 18 Aug 2014, resigned 11 December 2014
Directors have been in office since the start of the financial year to the date of this report unless otherwise stated.
COMPANY SECRETARY
The following persons held the position of company secretary during the financial year:
Mr Nick Beattie
Ms Sara Kelly
Ms Rebecca Sandford
Ms Amy Just
appointed 30 March 2015
resigned 21 Jul 2014, re-appointed 7 January 2015
resigned 30 March 2015
appointed 21 Jul 2014, resigned 11 December 2014
Mr Beattie and Ms Kelly held the positions of Company Secretary at the date of this report.
30
DIRECTORS’ REPORT (continued)
INFORMATION ON DIRECTORS
Mr David Yu Chen
Qualifications
Experience
Interest in shares and options
Directorships held in other listed entities during the past
three years
Mr Yan Liu
Qualifications
Experience
Interest in shares and options
Non-Executive Chairman
2014)
(appointed 30 November
B.Ec.
Mr Chen has over 16 years of corporate experience,
having served as Chief Executive and Board member for
companies listed on US and Hong Kong stock markets.
He founded Huashan Capital in 2009 to invest in the
resources sector. His investment experience includes
the establishment of a US-listed special purpose
acquisition fund and venture capital investments in
China. Mr Chen is currently the Vice Chairman and
President of Hengxing Gold, a Hong Kong Stock
Exchange listed gold mining company. Mr Chen has
served as an independent director at Zhonglu Group, a
Shanghai Stock Exchange listed diversified investment
holding company. He now serves as a director at
Payeco, a leading mobile payment service provider in
China; and as a director at Cardvalue, a technology
driven business loan provider in China.
18,288,070 ordinary shares
42,742,654 unlisted options (£0.01, 14 July 2018)
30,000,000 unlisted options (£0.01, 30 March 2020)
Hengxing Gold Holding Company Limited (from March
2013)
Zhonglu Company Limited (from May 2009 to November
2014)
Executive Director (appointed 11 December 2014)
B.Ec, MCom
Mr Liu has over 18 years of accounting and corporate
advisory experience in China and Australia. Mr Liu was
the Chief Financial Officer with AIM listed China Rerun
Chemical Group Limited, a China-based lubricant oil
company and a partner of Agile Partners, the financial
advisory company based in China. Previously, Mr Liu
was the Financial Controller at Legalwise Seminars Pty
in Australia and he spent 8 years at Chinatex
Corporation where he worked in project management
positions. Mr Liu holds a Bachelor degree in Economics
from Central University of Finance and Economics,
China, and a Master degree in Commerce from the
University of New South Wales, Australia.
6,333,333 ordinary shares
30,000,000 unlisted options (£0.01, 30 March 2020)
Directorships held in other listed entities during the past
three years
None
31
DIRECTORS’ REPORT (continued)
Mr Zhiwei Gu
Qualifications
Experience
Interest in shares and options
Non-Executive Director (appointed 11 December 2014)
LL.B, LL.M., MSc
Mr Gu is an experienced corporate lawyer, who has
worked with numerous companies seeking
listing
approval on various stock markets including Chinese A
share, NASDAQ, TSX and HKSE. He is currently a
partner of Dacheng Law Offices, the largest law firm in
China. Mr Gu has participated in several Venture Capital
and Private Equity investment cases by various funds,
such as London Asia Fund, Warburg Pincus, Korea
Development Bank, China Venture Investment Co, and
China Cinda AMC. During his time with China National
Gold Group Corp., Mr Gu was in charge of mineral
resource M&A activities. Mr Gu holds a LL.B. from the
Jilin University in China; a LL.M. from the Northeast
University in China; and a Master of Applied Finance
from the Macquarie University in Australia. Mr Gu is a
qualified lawyer and securities practitioner in China.
2,083,333 ordinary shares
7,500,000 unlisted options (£0.01, 30 March 2020)
Directorships held in other listed entities during the past
three years
None
Ms Juan Wang
Qualifications
Experience
Interest in shares and options
Non-Executive Director (appointed 30 November 2014)
BA, MBA
Ms Wang is currently a president of Energy Prospecting
Technology USA, Inc. and LandOcean Energy Canada
Ltd. where she is responsible for overall management
work for the subsidiary companies of LandOcean Energy
Services Co. Ltd. in Houston and Calgary. Prior to the
current position, she was an investment manager at
Anterra Energy Inc. responsible for Chinese investor
liaisons. Prior to joining Anterra, Ms Wang was manager
of corporate mergers and acquisitions at LandOcean
Energy Services Co. Ltd. Ms Wang has a commercial
banking background, having previously worked
for
Deutsche Bank and Bank of East Asia.
2,083,333 ordinary shares
7,500,000 unlisted options (£0.01, 30 March 2020)
Directorships held in other listed entities during the past
three years
Anterra Energy Inc.
32
DIRECTORS’ REPORT (continued)
Sir Samuel Esson Jonah
Qualifications
Experience
Non-Executive Chairman (resigned 28 November 2014)
DSc (Hons), MSc
Sir Sam Jonah is an Executive Chairman of Jonah
Capital (Pty) Limited, an investment holding company in
South Africa and serves on the boards of various public
and private companies, including Vodafone plc. He is
also Chairman of Metropolitan Insurance Company
Limited and was previously Chief Executive Officer of
Ashanti Goldfields Company Limited, Executive
President of AngloGold Ashanti Limited, a director of
Lonmin Plc and a member of the Advisory Council of the
President of the African Development Bank.
Interest in shares and options
21,597,833 ordinary shares
Directorships held in other listed entities during the past
three years
Vodafone Plc (from 1 April 2009)
Mr Rory George Scott Russell
Qualifications
Experience
Executive Director and Chief Executive Officer
re-elected 28
(appointed 3 February 2014, not
November 2014)
BSc (Hons)
Mr Rory Scott Russell has over ten years of international
experience in upstream positions at Shell. He previously
worked as Finance Manager for Exploration in Europe
and Russia, involved in country entries and project start-
ups in Greenland, Albania, Spain, Ukraine and Russia.
Prior to this he was Finance and Commercial Manager
for exploration and has also worked in the strategic
planning unit for Shell's global upstream business.
Interest in shares and options
Directorships held in other listed entities during the past
three years
Nil
None
Mr Graham Victor Lyon
Qualifications
Experience
Non-Executive Director (appointed 3 February 2014, not
re-elected 28 November 2014)
BSc (Hons)
Mr Graham Lyon has over 30 years of experience in the
oil and gas industry, working for a wide range of listed
and private companies. He started his career with
Chevron before moving to Shell as sub surface team
leader and as project petroleum engineer. Graham
previously held positions with Deminex in a series of
technical leadership roles, and with Petro-Canada as
Vice President Strategy and Business Development.
Graham has also held senior positions with Mena
Hydrocarbons Inc, Hawkley Oil and Gas Ltd, Tarbagatay
Munay LLP and Soncer Ltd.
Interest in shares and options
Nil
33
DIRECTORS’ REPORT (continued)
Directorships held in other listed entities during the past
three years
Mena Hydrocarbons Inc (from 31 January 2011 to 30
November 2012)
Hawkley Oil and Gas Ltd (from 30 August 2012 to 14
October 2014)
Dr Christian Eduard Wilhelm Johann Bukovics
Qualifications
Experience
Non-Executive Director (appointed 3 February 2014, not
re-elected 28 November 2014)
PhD
Dr Christian Bukovics has over 30 years’ experience in
exploration and has held executive positions at Shell.
Until end of 2012, Christian was Vice President for
exploration in Russia and the FSU and a member of the
global exploration leadership team. Prior to this he held
the exploration manager position for the European
for Shell
Atlantic Margin, was General Manager
businesses in Iran and Kazakhstan and Vice President
for the Commercial division of Shell Global Exploration.
Interest in shares and options
280,000 ordinary shares
Directorships held in other listed entities during the past
three years
None
Mr David Noel Riekie
Qualifications
Experience
Non-Executive Director (appointed 27 June 2014)
Executive Director
resigned 11 December 2014)
(appointed 4 December 2014,
B.Ec., CA, AICD, Dip Acc
Mr David Riekie has over 20 years of corporate
experience through a variety of executive and advisory
roles in the Industrial and Resource sectors of Australia.
Mr Riekie is a former director of Hawkley Oil and Gas
Limited and was a founding Director of Otto Energy.
Interest in shares and options
Nil
Directorships held in other listed entities during the past
three years
AVZ Minerals Ltd (from 21 Aug 2008 to 3 Aug 2012)
Hawkley Oil and Gas Ltd (from 22 Jun 2010 to 17 Sep
2013)
Mr Ian Peter Olson
Qualifications
Experience
Non-Executive Director (appointed 18 August 2014,
resigned 11 December 2014)
B.Com, CA, AICD
Mr Ian Olson is a Chartered Accountant with over 25
years of experience whose areas of expertise include
corporate finance, audit and assurance across a broad
range of
including energy. Previously
Managing Partner of PKF Chartered Accountants in
Perth, Western Australia, Ian also spent numerous years
working with global investment banks in London and
New York.
industries
34
DIRECTORS’ REPORT (continued)
Interest in shares and options
Nil
Directorships held in other listed entities during the past
three years
Gage Roads Brewing Co Ltd (from November 2007)
Diploma Group Ltd (from October 2007 to 31 March
2015)
RuralAus Investments Ltd (from 2005 to 26 February
2013)
Mr Marcus Edwards-Jones
Non-Executive Director (not re-elected 28 November
2014)
Qualifications
Experience
Interest in shares and options
BA (Hons), MA (Oxon)
Mr Marcus Edwards-Jones is a Managing Director and
co-founder of Lloyd Edwards-Jones S.A.S, a financial
boutique firm. Mr Edwards-Jones has previously held
positions with Bank Julius Baer Paris, and Credit
Lyonnais Securities. In addition, Mr Edwards-Jones has
significant experience in worldwide institutional capital
raisings for large resource projects in Africa.
3,531,522 ordinary shares
750,000 partly paid shares (paid up to 30 cents)
Directorships held in other listed entities during the past
three years
Noricum Gold Limited (from 18 June 2010)
Mr Ian Alexander Macliver
Non-Executive Director (appointed 27 June 2014,
resigned 13 August 2014)
Qualifications
Experience
B.Com, CA, FINSIA, AICD
Mr Ian Macliver has extensive experience as a senior
executive and director of both resource and industrial
companies. Mr Macliver is Principal of a specialist
corporate advisory firm in Australia and is a director of
various listed and unlisted companies.
Interest in shares and options
Nil
Directorships held in other listed entities during the past
three years
Otto Energy Ltd (from 7 January 2004)
Rent.com.au (formerly Select Exploration Ltd) (from 14
September 2010)
Western Areas Ltd (from October 2011)
INFORMATION ON COMPANY SECRETARIES
Mr Nick Beattie
Qualifications
Experience
Joint Company Secretary (appointed 30 March 2015)
BA (Hons), FCIBS, AMCT
Mr Nick Beattie has over twenty years of experience in
finance working with a range of international banks. Most
recently he was a Managing Director in the BNP Paribas
Upstream Oil and Gas team in London where he was
responsible for leading the bank relationships with UK
focused independent E&P companies. Nick has
35
DIRECTORS’ REPORT (continued)
ten
years’ experience
approximately
specifically
financing the E&P sector and whilst at BNP Paribas, he
structured and led numerous reserve based loans,
development financings and other debt facilities. Prior to
working with BNP Paribas, Nick worked as a Director
within the Oil and Gas finance team at Fortis Bank
covering Europe, Middle East and Africa and in a variety
of roles with National Australia Bank Group. Nick is an
Associate Member of the Association of Corporate
Treasurers and a Fellow of the Chartered Institute of
Bankers in Scotland.
Interest in shares and options
2,916,667 ordinary shares
25,000,000 unlisted options (£0.01, 30 March 2020)
Directorships held in other listed entities during the past
three years
None
Ms Sara Claire Kelly
Qualifications
Experience
Joint Company Secretary (resigned 21 July 2014, re-
appointed 7 January 2015
B.Com, LLB
Ms Sara Kelly is an experienced Company Secretary
and Corporate Lawyer with over 9 years’ experience.
Sara has comprehensive knowledge of and experience
in administering regulatory frameworks and processes in
a listed company environment and practised as a
corporate lawyer specialising in acquisitions, takeovers,
capital raisings and listing of companies on ASX and
AIM. Sara has acted as the company secretary of a
number of ASX listed companies.
Interest in shares and options
Directorships held in other listed entities during the past
three years
Nil
None
Ms Rebecca Louise Sandford
Company Secretary (appointed 22 April 2014, resigned
30 March 2015)
Qualifications
Experience
B.Bus, AGIA
experience
raisings,
Sandford’s
takeovers, capital
includes
Ms Rebecca
listing of
acquisitions,
reviews and
companies on ASX, due diligence
compliances. Rebecca has acted as the company
secretary of a number of ASX
listed companies.
Rebecca is a member of the Governance Institute of
Australia.
Interest in shares and options
595,238 ordinary shares
Directorships held in other listed entities during the past
three years
None
Ms Amy Just
Qualifications
Company Secretary (appointed 21 July 2014, resigned
11 December 2014)
B. Bus, CA, AGIA
36
DIRECTORS’ REPORT (continued)
Experience
Ms Amy Just’s experience includes corporate advisory,
company secretarial and financial management services.
Amy has ten years of experience as a Chartered
Accountant and is member of the Governance Institute
of Australia. Amy has acted as the Financial Controller
and Company Secretary of numerous domestic and
international oil & gas and mineral exploration
companies.
Interest in shares and options
Directorships held in other listed entities during the past
three years
Nil
None
SIGNIFICANT CHANGES IN STATE OF AFFAIRS
The following significant changes in the state of affairs of the Company occurred during the financial year:
•
•
The restructure of the Board of Directors;
In line with the Company’s focus on growing and developing its core assets, the Company has completed a
number of non-core asset divestments, including sales of the drilling business, Texas assets, and equity
holding in Citation Resources, as well as withdrawal from Puntland.
Further details on the above matters can be found in the Review of Operations.
EVENTS SUBSEQUENT TO REPORTING DATE
Equity Financing with Sibo
Subsequent to the period end, equity financing with Sibo completed. As per the terms of the subscription agreement,
Range issued approximately 2,450 million new ordinary fully paid shares of the Company to Sibo at a subscription price
of £0.008 per share. The Company also issued 194,585,862 unlisted warrants with an exercise price of £0.01 and
172,557,274 unlisted warrants with an exercise price of £0.02 to Sibo. All warrants have an expiry date of 3 September
2019. Range’s Directors and management also subscribed for ordinary shares in an amount of US$0.3 million in cash.
Range issued 25 million new Shares to Directors and management at a subscription price of £0.008 per Share.
St Mary’s Bond
Subsequent to the period end, Range used US$8 million of the Sibo proceeds to provide the Ministry of Energy and
Energy Affairs with the required performance bond in support of the minimum work obligations on the St Mary’s licence.
The Company is seeking alternative sources of finance to replace this bond, which would allow the cash collateral to be
released and used for other purposes.
Loan Financing with Lind
Subsequent to the period end, the Company announced that its application to the Supreme Court of Western Australia
to set aside the statutory demand from Lind Asset Management, LLC had been unsuccessful. The Supreme Court
extended the time for payment of the demand. Subsequently, Range filed an appeal against the Supreme Court’s
decision, and the Western Australian Court of Appeal extended the deadline for repayment until the later of 31 August
2015 or 7 days from the determination of the appeal. In advance of the appeal, Range paid US$5 million to Lind without
prejudice to its contentions in the appeal. On 10 September 2015 the appeal was heard and as at the date of this
report, no decision has been received from the Western Australian Court of Appeal.
Guayaguayare Block
Subsequent to the period end, Range obtained a consent from the Minister of Energy and Energy Affairs of Trinidad
and Tobago and the other partners in the block, Niko Resources Ltd. (“Niko”) and Petrotrin, for the assignment of
Niko’s partial interest as contemplated in the original farm-in transaction entered into in December 2013. Therefore,
37
DIRECTORS’ REPORT (continued)
Range holds a 40% interest in the Deep Production Sharing Contract (“PSC”) and a 32.5% interest in the Shallow PSC.
In addition, Range has been appointed as the Operator of the block.
LIKELY DEVELOPMENTS AND EXPECTED RESULTS
The Company intends to continue with its development plans in Trinidad by executing the planned work programme of
development and exploration wells, implementing secondary recovery (waterflood) projects and exploration of deeper
production horizons. In addition, the Company will continue to rationalise the non-core assets. Please refer to the
Review of Operations for full details on likely developments and future prospects of the Group.
ENVIRONMENTAL REGULATION
The Group’s operations are not regulated by any significant environmental regulation under a law of the
Commonwealth or of a state or territory.
The Directors have considered compliance with the National Greenhouse and Energy Reporting Act 2007 which
requires entities to report annual greenhouse gas emissions and energy use. The directors have assessed that there
are no current reporting requirements, but may be required to do so in the future.
REMUNERATION REPORT (AUDITED)
This report details the nature and amount of remuneration for each director of Range Resources Limited.
(a)
Remuneration Policy
The remuneration policy of Range Resources Limited has been designed to align director and executive
objectives with shareholder and business objectives by providing a fixed remuneration component and offering
specific long-term incentives based on key performance areas affecting the Group’s financial results. The Board
of Range Resources Limited believes the remuneration policy to be appropriate and effective in its ability to
attract and retain the best executives and directors to run and manage the Group, as well as create alignment of
goals between directors, executives and shareholders.
The Board’s policy for determining the nature and amount of remuneration for Board members and senior
executives of the Company is as follows:
The remuneration policy, setting the terms and conditions for the executive directors and other senior
executives, was developed and approved by the Board.
Non-executive directors, executive directors and senior executives receive a base salary (which is based on
factors such as length of service and experience), which is calculated on a total cost basis and includes any
FBT charges related to employee benefits including motor vehicles, as well as employer contributions to
superannuation funds.
Executive directors can be employed by the Company on a consultancy basis, on Board approval, with
remuneration and terms stipulated in individual consultancy agreements.
The Board exercises its discretion in determining remuneration performance of executives. Given the size and
nature of the entity, the Board does not deem it to be realistic to measure performance against defined criteria.
As such remuneration and performance have historically not been linked.
All remuneration paid to directors and executives is valued at the cost to the Company and expensed. Shares
given to directors and executives are valued as the difference between the market price of those shares and the
amount paid by the director or executive. Unlisted options are valued using the Black-Scholes methodology.
The Board policy is to remunerate non-executive directors at market rates for comparable companies taking into
consideration time, commitment and level of responsibility. As approved by shareholders in 30 November 2011,
the aggregate non-executive remuneration per annum
The
Remuneration and Nomination Committee determines payments to the non-executive directors and reviews
their remuneration annually. Independent external advice is sought when required. Fees for non-executive
directors are not linked to the performance of the Group. The directors are not required to hold any shares in
is currently A$350,000 (US$291,472).
38
REMUNERATION REPORT (AUDITED) (continued)
the Company under the Constitution of the Company; however, to align Directors’ interests with shareholder
interests, the directors are encouraged to hold shares in the Company.
Options may be issued to directors and executives as part of remuneration. Options issued to directors have
historically not been based on performance criteria. However, the options issued to the current directors on 27
March 2015 principally vest upon satisfaction of set company performance criteria detailed in Note 32.
Under the Company’s share trading policy, all employees and directors of the Company and its related
companies are prohibited from trading in the Company’s shares or other securities if they are in possession of
inside information.
The Board believes that it has implemented suitable practices and procedures that are appropriate for an
organisation of this size and maturity.
(i) Remuneration Committee
During the year ended 30 June 2014, the Group did not have a separately established nomination or
remuneration committee. Considering the number of directors, the Board was of the view that these functions
could be efficiently performed with full Board participation. In line with the enhanced corporate governance
processes implemented, a Remuneration Committee was established in the year.
(ii) Company Performance, Shareholder Wealth and Directors and Executives Remuneration
No relationship exists between shareholder wealth, director and executive remuneration and Company
performance.
(iii) Use of remuneration consultants
During the year ended 30 June 2015, the Group contracted the service of a remuneration consultant, The
Curzon partnership, to provide market comparison for executive and non-executive remuneration. The fee for
this service was GB£480.
(iv) Voting and comments made at the company’s 2014 Annual General Meeting
Range Resources Limited received 77% of “yes” votes on its remuneration report for the 2014 financial year.
During the year the company received feedback from certain shareholders that the level of Director
remuneration was excessive for a company of Range’s current scale and financial position. This was evidenced
by the vote at the AGM regarding an increase in the Non-Executive Director fee pool where 83% of votes cast
were against the resolution. In response to shareholder feedback the company has reviewed its remuneration
practices and the remuneration for the current board has been set at a significantly lower level than in previous
years.
(b)
Key Management Personnel
NAME
POSITION HELD
APPOINTMENT/RESIGNATION DATE
Directors
Mr David Yu Chen
Ms Juan Wang
Mr Yan Liu
Mr Zhiwei Gu
Sir Samuel Jonah
Mr Rory Scott Russell
Non-Executive Chairman
Non-Executive Director
Executive Director
Non-Executive Director
Non-Executive Chairman
Executive Director
Mr Marcus Edwards-Jones
Dr Christian Bukovics
Non-Executive Director
Non-Executive Director
Mr Graham Lyon
Non-Executive Director
appointed 30 November 2014
appointed 30 November 2014
appointed 11 December 2014
appointed 11 December 2014
resigned 28 November 2014
appointed 3 Feb 2014, not re-elected 28
November 2014
not re-elected 28 November 2014
appointed 3 Feb 2014, not re-elected 28
November 2014
appointed 3 Feb 2014, not re-elected 28
November 2014
39
REMUNERATION REPORT (AUDITED) (continued)
Mr David Riekie
Mr Ian Macliver
Mr Ian Olson
Officers
Mr Nick Beattie
Non-Executive Director
Executive Director
Non-Executive Director
Non-Executive Director
CFO & Company Secretary
Ms Sara Kelly
Company Secretary
Ms Rebecca Sandford
Ms Amy Just
Company Secretary
Company Secretary
appointed 27 Jun 2014
appointed 4 December 2014, resigned 11
December 2014
resigned 13 Aug 2014
appointed 18 Aug 2014, resigned 11
December 2014
appointed 23 May 2014 (as CFO) and 30
March 2015 (as Company Secretary)
resigned 21 Jul 2014, re-appointed 7
January 2015
resigned 30 March 2015
appointed 21 Jul 2014, resigned 11
December 2014
40
REMUNERATION REPORT (AUDITED) (continued)
(c)
Details of Remuneration
The remuneration for the Key Management Personnel of the Group during the year was as follows:
Short-Term Employee Benefits
Post
Employment
Benefits
Share-
based
Payments
2015
Cash Salary
and Fees
Cash
Bonus
Termination
Benefits
Super-
annuation/
Pensions
Options
Total
US$
US$
US$
US$
US$
US$
Directors & officers
Sir Sam Jonah
Mr Scott Russell
Mr Beattie
Mr Edwards-Jones
Mr Macliver
Mr Lyon (i)
Dr Bukovics
Mr Riekie (ii)
Mr Olson
Mr Chen
Mr Liu
Ms Wang
Mr Gu
37,609
103,137
228,342
37,609
5,584
50,093
37,889
45,836
21,265
88,710
86,418
19,152
16,694
778,338
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
150,253
-
-
-
-
-
-
-
-
-
-
-
150,253
-
-
28,152
-
-
-
-
-
-
-
-
-
-
28,152
-
-
-
-
-
-
-
-
-
34,186
34,186
8,546
8,546
85,464
37,609
253,390
256,494
37,609
5,584
50,093
37,889
45,836
21,265
122,896
120,604
27,698
25,240
1,042,207
(i)
(ii)
Fees paid to Mr Lyon comprised US$37,299 received in his capacity as a non-executive director and US$12,794 received for
additional consulting work.
Fees paid to Mr Rieke comprised US$31,416 received in his capacity as a non-executive director and US$14,420 received for
additional consulting work.
Short-Term Employee
Benefits
Cash
Salary
and Fees
US$
Cash
Bonus
US$
Post
Employment
Benefits
Super-
annuation
Share-based
Payments
Options
US$
US$
91,473
116,064
30,593
91,473
105,536
43,024
-
-
329,268
223,151
-
1,030,582
-
84,042
33,235
-
-
-
-
-
-
-
-
117,277
-
-
-
-
-
-
-
-
-
-
-
-
-
35,414
11,069
-
-
1,816
-
-
-
-
-
48,299
2014
Directors & officers
Sir Sam Jonah
Mr Scott Russell (iii)
Mr Beattie (iii)
Mr Edwards-Jones
Mr Lyon
Dr Bukovics
Mr Macliver
Mr Riekie
Mr Landau(i)
Mr Eastman
Ms Flegg (ii)
Total
US$
91,473
235,520
74,897
91,473
105,536
44,840
-
-
329,268
223,151
-
1,196,158
(i)
(ii)
(iii)
Fees paid to Mr Landau comprised US$289,268 received in his capacity as an executive director and US$40,000 received in his
capacity as a non-executive director
Ms Flegg was an employee of OKAP ventures Pty Ltd (a Related Party) and was paid a salary through Okap’s consulting
agreement with Range Resources Limited. This consulting agreement was terminated in the 2015 financial year.
Cash bonuses paid to Mr Scott Russell and Mr Beattie were in respect of sign on bonuses in accordance with their respective
employment contracts and were not linked to Company or Group performance.
41
REMUNERATION REPORT (AUDITED) (continued)
(d)
Equity instrument disclosures relating to Key Management Personnel
(i)
Share-based Payments
On 27 March 2015, the following options were issued to key management personnel:
Name
Mr Yan Liu
Mr David Chen
Mr Zhiwei Gu
Ms Juan Wang
Number of options
30,000,000
30,000,000
7,500,000
7,500,000
Al options expire on 30 March 2020 with an exercise price of £0.01 per share.
The vesting conditions of these options are as follows:
(a) 25% will become exercisable on the date that is one year from the issue date
(b) 25% will become exercisable upon the Company reaching production of 1,500 barrels of oil per day for a continuous
15 day period in Trinidad
(c) 25% will become exercisable upon the Company reaching production of 2,500 barrels of oil per day for a continuous
15 day period in Trinidad
(d) 25% will become exercisable upon the Company reaching production of 4,000 barrels of oil per day for a continuous
15 day period in Trinidad
The value per option at the grant date was 0.51 cents, determined using the Black Scholes option price model using
the following key inputs:
Volatility: 100%
Risk free rate: 1.92%
USD/GBP exchange rate: 0.7752
Grant date: 27 March 2015
Exercise price: £0.01
Share price on grant date £0.054
In 2014, no options were issued to Directors or employees.
(ii) Shares provided on exercise of remuneration options
No options issued in prior years affects remuneration in the current or future financial years.
42
REMUNERATION REPORT (AUDITED) (continued)
(iii) Fully paid share holdings
The numbers of shares in the company held during the financial year or at time of resignation by Key
Management Personnel of the Company, including their personally related parties, are set out below.
Shareholdings
2015
Sir Sam Jonah (i)/(ii)
Mr Scott Russell (i)
Mr Beattie
Mr Edwards-Jones (i)/(ii)
Mr Macliver
Dr Bukovics (i)/(ii)
Mr Lyon (i)
Mr Riekie (iii)
Mr Olson (iii)
Mr Chen(iv)
Mr Liu
Ms Wang
Mr Gu
Total
Balance at
the start of
the year
21,597,833
-
-
3,531,522
-
280,000
-
-
-
4,288,070
-
-
-
29,697,425
Granted as
compensation
Other
changes
Balance at
the end of
the year
Balance
held
indirectly
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
6,000,000
-
-
-
21,597,833
-
-
3,531,522
280,000
-
-
-
10,288,070
-
-
-
6,000,000
35,697,425
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(i)
(ii)
(iii)
(iv)
Not re-elected 28 November 2014
Balance at date of non re-election
Resigned 11 December 2014
Balance at appointment date
(v) Partly paid shareholdings (Note 26c)
The numbers of shares in the company held during the financial year or at time of resignation by Key
Management Personnel of the Company, including their personally related parties, are set out below.
Partly paid shareholdings
2015
Mr Edwards-Jones
Total
Balance at
the start of
the year
750,000
750,000
Granted
as
compensation
-
Cancelled
in year
(750,000)
-
(750,000)
Balance at
the end of
the year
Balance held
indirectly
-
-
-
-
43
REMUNERATION REPORT (AUDITED) (continued)
vi) Options held by key management personnel
The numbers of options in the company held during the financial year or at time of resignation by Key
Management Personnel of the Company, including their personally related parties, are set out below:
Options
2015
Mr Chen
Mr Liu
Ms Wang
Mr Gu
Total
Balance at the
start of the
year
-
-
-
-
-
Granted as
compensation
Other
Changes*
Balance at the
end of the year
30,000,000
30,000,000
7,500,000
7,500,000
75,000,000
42,742,654
-
-
-
42,742,654
72,742,654
30,000,000
7,500,000
7,500,000
117,742,654
*Issued prior to appointment as director.
(e)
Loans to Key Management Personnel
There were no loans made to directors of Range Resources Limited and other Key Management Personnel of the
Group, including their personally related parties during the 2014 or 2015 financial years.
(f)
Transactions with Key Management Personnel
The following transactions occurred during the year with Key Management Personnel or their related parties:
Consulting fees paid or payable to OKAP Ventures Pty Ltd., a company in which Mr Landau is a
the provision of corporate advisory, capita raising, company secretarial,
Director,
investor/public relations and associated services including provision of all financial and
administrative staff and office space in west Perth and London (iii)
for
Balances at year end due to former key management personnel:
Sir Sam Jonah (i)
Marcus Edwards-Jones (i)
Soncer Limited (i)
Anthony Eastman (iii)
OKAP Ventures Pty Ltd payable (iii)
Doull Holdings Pty Ltd payable (in respect of Peter Landau Director fees) (iii)
2015
US$
2014
US$
-
780,718
191,440
33,566
18,442
169,280
64,579
165,403
219,661
33,419
-
221,063
79,585
181,612
(i)
(ii)
(iii)
These were related parties throughout the financial year until 28 November 2014.
David Riekie was a related party throughout the financial year until 11 December 2014.
Related party until 13 June 2014
44
REMUNERATION REPORT (AUDITED) (continued)
(g)
Employment Contracts of Directors and Other Key Management Personnel
On appointment, Executive Directors and Other Key Management Personnel enter into an employment contract
with the Company (or another company within the Group). This contract sets out their duties, remuneration and
other terms of employment. These contracts may be terminated by either the Company or the employee as
detailed below.
All non-executive directors are eligible to receive consulting fees for services provided to the Company over and
above the services expected from a non-executive director.
Sir Sam Jonah as Non-Executive Chairman (resigned 28 November 2014)
Contract term – 3 years from 1 July 2012
Base payment - AU$100,000 per annum
Superannuation – no superannuation entitlement
Notice period – 6 months
Termination benefits – payment for the balance of the term of the contract for termination without cause
Mr Rory Scott Russell as Chief Executive Officer and Executive Director (not re-elected 28 November
2014, CEO position terminated 4 December 2014)
Contract start date – 3 February 2014
Base payment - GB£150,000 per annum, reviewed annually
Pension – 10% of base
Bonus – eligible to receive bonuses are at the discretion of the Board
Notice period – first 12 months – 3 months, thereafter 6 months
Termination benefits – payment in lieu of notice at Company option for termination without cause
Mr Nick Beattie as Chief Financial Officer
Contract start date – 23 May 2014
Base payment - GB£135,000 per annum, reviewed annually
Pension – 10% of base
Bonus – eligible to receive bonuses at the discretion of the Board
Notice period – 3-6 months
Termination benefits – 6 months’ salary
Mr Marcus Edwards-Jones as Non-Executive Director (not re-elected 28 November 2014)
Contract term – 3 years from 15 August 2012
Base payment - AU$100,000 per annum
Superannuation – no superannuation entitlement
Notice period – 6 months
Termination benefits – payment for the balance of the term of the contract for termination without cause
Mr Graham Lyon as Non-Executive Director (not re-elected 28 November 2014)
Contract term – 3 years from 1 February 2014
Base payment - GB£55,000 per annum
Notice period – 3 months
Termination benefits – payment for the balance of the term of the contract
Consulting services – Mr Lyon may provide additional consulting services over and above services rendered to
the Company as a non-executive director from time to time as required at a rate of GB£2,000 per day.
Dr Christian Bukovics as Non-Executive Director (not re-elected 28 November 2014)
Contract term – 3 years from 3 February 2014
Base payment - GB£55,000 per annum
Notice period – 3 months
Termination benefits – payment for the balance of the term of the contract for termination without cause
45
REMUNERATION REPORT (AUDITED) (continued)
Mr David Riekie as Non-Executive Director (resigned 11 December 2014)
Contract start date – 27 June 2014
Base payment - AU$72,000 per annum
Superannuation – no superannuation entitlement
Termination benefits – none
Consulting services – Mr Riekie may provide additional consulting services over and above services rendered to
the Company as a non-executive director from time to time as required at a rate of AU$1,400 per day.
Mr Ian Olson as Non-Executive Director (resigned 11 December 2014)
Appointment date –18 August 2014
Base payment - AU$72,000 per annum
Superannuation – no superannuation entitlement
Termination benefits – none
Mr Ian Macliver as Non-Executive Director (resigned 13 August 2014)
Contract start date –27 June 2014
Base payment - AU$72,000 per annum
Superannuation – no superannuation entitlement
Termination benefits – none
Mr David Chen as Non-Executive Chairman (appointed 30 November 2014)
Contract start date –11 December 2014
Total compensation including management services - US$155,000 per annum
Superannuation – no superannuation entitlement
Notice period – 3 months
Termination benefits – payment in lieu of notice at Company option for termination without cause
Mr Yan Liu as Chief Executive Officer and Executive Director (appointed 11 December 2014)
Contract start date –11 December 2014
Base payment - US$155,000 per annum
Superannuation – no superannuation entitlement
Notice period – 3 months
Termination benefits – payment in lieu of notice at Company option for termination without cause
Ms Juan (Kiki) Wang as Non-Executive Director (appointed 30 November 2014)
Contract start date –19 January 2015
Base payment - US$30,000 per annum
Superannuation – no superannuation entitlement
Termination benefits – none
Mr Zhiwei (Kerry) Gu as Non-Executive Director (appointed 11 December 2014)
Contract start date –19 January 2015
Base payment - US$30,000 per annum
Superannuation – no superannuation entitlement
Termination benefits – none
End of Audited Remuneration Report
46
MEETINGS OF DIRECTORS
During the financial year 11 meetings of the board of directors were held. Attendances by each director during the year
were as follows:
Board Meetings
Attended
Attended
5
4
2
2
4
4
5
5
5
1
8
6
5
4
2
2
4
4
5
5
5
1
8
6
Director
David Chen (appointed 30 Nov 2014)
Juan Wang (appointed 30 Nov 2014)
Yan Liu (appointed 11 Dec 2014)
Zhiwei Gu (appointed 11 Dec 2014)
Samuel Jonah (resigned 28 Nov 2014)
Marcus Edwards-Jones (not re-elected 28
Nov 2014)
Rory Scott Russell (not re-elected 28 Nov
2014)
Graham Lyon (not re-elected 28 Nov 2014)
Christian Bukovics (not re-elected 28 Nov
2014)
Ian Macliver (resigned 13 Aug 2014)
David Riekie (resigned 11 Dec 2014)
Ian Olson (appointed 18 Aug 2014, resigned
11 Dec 2014)
INDEMNIFYING OFFICERS OR AUDITOR
In accordance with the constitution, except where prohibited by the Corporations Act 2001, every director, principal
executive officer and secretary of the Company shall be indemnified out of the property of the Company against any
liability incurred by him/her in his/her capacity as director, principal executive officer or secretary of the Company or any
related corporation in respect of any act or omission whatsoever and howsoever occurring or in defending any
proceedings whether civil or criminal.
During the financial year, the Company has paid premiums to insure the Directors and Officers against certain liabilities
arising out of the conduct of acting as an officer of the Company. Under the terms and conditions of the insurance
contract, the nature of liabilities insured against and the premium paid cannot be disclosed.
PROCEEDINGS ON BEHALF OF THE COMPANY
No person has applied for leave of Court to bring proceedings on behalf of the Company or to intervene in any
proceedings to which the Company is a party for the purpose of taking responsibility on behalf of the Company for all or
any part of those proceedings.
The Company was not a party to any such proceedings during the year.
47
OPTIONS
At the date of this report, the unissued ordinary shares of Range Resources Limited under option are as follows:
Date of Expiry
31 January 2016
30 April 2016
31 January 2017
19 October 2015
30 November 2015
31 January 2016
10 February 2016
30 April 2016
11 July 2016
25 July 2016
29 July 2016
31 August 2016
31 August 2016
30 September 2016
30 September 2016
31 October 2016
31 October 2016
31 October 2016
31 October 2016
30 November 2016
30 November 2016
11 December 2016
31 December 2016
31 December 2016
31 January 2017
9 September 2017
14 July 2018
14 July 2018
31 January 2018
15 October 2017
30 March 2020
Exercise Price
$0.05
£0.17
£0.075
£0.0615
£0.05075
A$0.10
A$0.06
£0.04
£0.037
£0.021
£0.021
£0.021
£0.020
£0.019
£0.018
£0.018
£0.017
£0.016
£0.015
£0.015
£0.013
$0.0321
£0.012
£0.011
£0.011
£0.03
£0.01
£0.02
$0.05
£0.01203
£0.01
Number Under Option
80,508,341
7,058,824
5,180,000
15,708,801
32,275,862
5,000,000
5,000,000
146,533,850
5,000,000
476,190
952,381
6,714,284
9,000,000
3,947,369
8,666,670
694,445
2,205,885
1,250,000
17,333,336
3,000,001
5,153,846
2,000,000
2,000,000
5,000,000
23,636,364
7,500,000
161,472,247
118,729,593
1,000,000
31,000,000
75,000,000
788,998,289
listed
unlisted
unlisted
unlisted
unlisted
unlisted
unlisted
unlisted
unlisted
unlisted
unlisted
unlisted
unlisted
unlisted
unlisted
unlisted
unlisted
unlisted
unlisted
unlisted
unlisted
unlisted
unlisted
unlisted
unlisted
unlisted
unlisted
unlisted
unlisted
unlisted
unlisted
During the year ended 30 June 2015, 49,051,468 ordinary shares of Range Resources Limited were issued on the
exercise of options (2014: 70,833,334).
The holders of these options do not have any rights under the options to participate in any share issues of the
company.
CORPORATE GOVERNANCE
In recognising the need for the highest standards of corporate behaviour and accountability, the directors of Range
Resources Limited support and have adhered to the principles of Corporate Governance.
NON-AUDIT SERVICES
The total value of non-audit services provided by a related practice of BDO Audit (WA) Pty Ltd in respect to the
Company’s tax compliance is US$63,217 (2014: US$47,998).
The board of directors has considered the position and is satisfied that the provision of the non-audit services is
compatible with the general standard of independence for auditors imposed by the Corporations Act 2001. The
directors are satisfied that the provision of non-audit services by the auditor did not compromise the auditor
independence requirements of the Corporations Act 2001 for the following reasons:
•
•
all non-audit services have been reviewed by the Board to ensure they do not impact the impartiality and
objectivity of the auditor; and
none of the services undermine the general principles relating to auditor independence as set out in APES
110 Code of Ethics for Professional Accountants.
48
AUDITOR’S INDEPENDENCE DECLARATION
The auditor’s independence declaration, as required under Section 307C of the Corporations Act 2001, for the year
ended 30 June 2015 has been received and can be found on the following page.
Signed in accordance with a resolution of the Board of Directors.
___________________________
David Chen
Chairman
30 September 2015
49
Tel: +61 8 6382 4600
Fax: +61 8 6382 4601
www.bdo.com.au
38 Station Street
Subiaco, WA 6008
PO Box 700 West Perth WA 6872
Australia
DECLARATION OF INDEPENDENCE BY JARRAD PRUE TO THE DIRECTORS OF RANGE RESOURCES
LIMITED
As lead auditor of Range Resources Limited for the year ended 30 June 2015, I declare that, to the best
of my knowledge and belief, there have been:
1. No contraventions of the auditor independence requirements of the Corporations Act 2001 in
relation to the audit; and
2. No contraventions of any applicable code of professional conduct in relation to the audit.
This declaration is in respect of Range Resources Limited and the entities it controlled during the
period.
Jarrad Prue
Director
BDO Audit (WA) Pty Ltd
Perth, 30 September 2015
BDO Audit (WA) Pty Ltd ABN 79 112 284 787 is a member of a national association of independent entities which are all members of BDO Australia Ltd ABN
77 050 110 275, an Australian company limited by guarantee. BDO Audit (WA) Pty Ltd and BDO Australia Ltd are members of BDO International Ltd, a UK
company limited by guarantee, and form part of the international BDO network of independent member firms. Liability limited by a scheme approved under
Professional Standards Legislation, other than for the acts or omissions of financial services licensees.
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2015
Note
Consolidated
2015
US$
2014
US$
Revenue from continuing operations
3
13,152,954
21,185,745
Operating expenses
Royalties
Depreciation, depletion and amortisation
Cost of sales
Gross loss
Other income and expenses from continuing operations
Other income
Finance costs
General and administration expenses
Assets written-off
Exploration expenditure and land fees
Loss on disposal of subsidiary
Share of net loss of investments in associates
Loss before income tax expense from continuing operations
Income tax expense
Loss after income tax from continuing operations
Loss from discontinued operations, net of tax
Loss for the year attributable to equity holders of Range
Resources Limited
Other comprehensive income/(loss)
Items that may be reclassified to profit or loss
Revaluation of available for sale financial assets
Exchange differences on translation of foreign operations
Other comprehensive income/(loss) for the year, net of tax
Total comprehensive loss attributable to equity holders of
Range Resources Limited
4a
3
4b
4b
4c
4d
4e
19
6
5a
27d
27c
(6,440,734)
(4,654,241)
(4,917,053)
(16,012,028)
(9,549,610)
(7,353,237)
(7,909,945)
(24,812,792)
(2,859,074)
(3,627,047)
428,588
(4,347,575)
(9,948,494)
(692,929)
(2,202,748)
(1,491,857)
-
(21,114,089)
1,221,108
(21,797,779)
(14,485,854)
(24,267,968)
(1,163,920)
-
(659,400)
(64,780,860)
(1,467,806)
(22,581,895)
(906,620)
(65,687,480)
(7,697,159)
(36,854,510)
(30,279,054)
(102,541,990)
-
455,307
455,307
325,263
(411,110)
(85,847)
(29,823,747)
(102,627,837)
Loss per share from continuing operations attributable to the ordinary equity holders of the Company:
Basic loss per share (cents per share)
Diluted loss per share (cents per share)
(0.44)
n/a
8a
8b
(1.85)
n/a
Loss per share attributable to the ordinary equity holders of the Company:
Basic loss per share (cents per share)
Diluted loss per share (cents per share)
8a
8b
(0.59)
n/a
(2.89)
n/a
The above consolidated statement of profit or loss and other comprehensive income should be read in conjunction with
the accompanying notes.
51
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2015
Note
Consolidated
2015
US$
2014
US$
ASSETS
CURRENT ASSETS
Cash and cash equivalents
Trade and other receivables
Other current assets
Non-current assets classified as held for sale
TOTAL CURRENT ASSETS
NON-CURRENT ASSETS
Deferred tax asset
Available for sale financial assets
Goodwill
Property, plant and equipment
Exploration & evaluation expenditure
Producing assets
Investments in associates
Other non-current assets
TOTAL NON-CURRENT ASSETS
TOTAL ASSETS
CURRENT LIABILITIES
Trade and other payables
Current tax liabilities
Borrowings
Option liability
Provisions
TOTAL CURRENT LIABILITIES
NON-CURRENT LIABILITIES
Deferred tax liabilities
Employee service benefits
TOTAL NON-CURRENT LIABILITIES
TOTAL LIABILITIES
NET ASSETS
EQUITY
Contributed equity
Reserves
Accumulated losses
TOTAL EQUITY
9
10
11
12
6
13
15
16
17
18
19
20
21
22a
22b
23
24
25a
26
27
10,530,104
5,148,978
783,385
16,462,467
6,000,000
2,977,410
5,338,769
728,544
9,044,723
11,000,000
22,462,467
20,044,723
286,693
446,000
46,198,974
1,502,442
668,951
90,350,492
-
-
462,325
876,347
46,198,974
11,254,269
523,605
82,517,820
2,779,476
1,500,000
139,453,552
146,112,816
161,916,019
166,157,539
13,654,195
296,894
7,518,077
808,083
734,858
23,012,107
43,359,199
521,257
43,880,456
8,705,005
310,335
-
2,189,913
696,244
11,901,497
44,376,033
584,746
44,960,779
66,892,563
56,862,276
95,023,456
109,295,263
363,205,277
29,748,880
(297,930,701)
352,599,569
27,862,006
(271,166,312)
95,023,456
109,295,263
The above consolidated statement of financial position should be read in conjunction with the accompanying notes.
52
Consolidated
Balance at 1 July 2013
Other comprehensive income/(loss)
Loss attributable to members of the
company
Total comprehensive loss for the
year
Transactions with owners in their
capacity as owners:
Issue of share capital
Unissued share capital
Exercise of options
Cost of share-based payments
Issue costs
Balance at 30 June 2014
Balance at 1 July 2014
Other comprehensive income/(loss)
Loss attributable to members of the
company
Total comprehensive loss for the
year
Transactions with owners in their
capacity as owners:
Issue of share capital
Exercise of options
Cancellation of partly paid shares
Expired options - Reclassified
Cost of share-based payments
Balance at 30 June 2015
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2015
Note
Contributed
Equity
US$
314,199,634
-
Accumulated
Losses
US$
(168,624,322)
-
Foreign
Currency
Translation
Reserve
US$
3,415,742
(411,110)
Available for
Sale Investment
Revaluation
Reserve
US$
(325,263)
325,263
Share-based
Payment
Reserve
US$
14,085,042
-
Option
Premium
Reserve
US$
9,815,752
-
-
-
(102,541,990)
-
-
(102,541,990)
(411,110)
325,263
-
-
-
-
26
26
26
26
26
26
26
32,467,157
6,000,000
652,778
-
(720,000)
352,599,569
-
-
-
-
-
(271,166,312)
US$
352,599,569
-
US$
(271,166,312)
-
-
-
-
-
-
3,004,632
US$
3,004,632
455,307
-
-
(30,279,054)
-
(30,279,054)
455,307
11,044,172
923,880
(1,362,344)
-
-
363,205,277
-
-
1,362,344
2,152,321
-
(297,930,701)
-
-
-
-
-
3,459,939
US$
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
141,819
-
14,226,861
US$
14,226,861
-
-
-
-
-
814,761
-
-
10,630,513
US$
10,630,513
-
-
-
-
-
-
(2,152,321)
2,157,038
14,231,578
-
1,426,850
-
-
-
12,057,363
The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes.
Total Equity
US$
172,566,585
(85,847)
(102,541,990)
(102,627,837)
32,467,157
6,000,000
1,467,539
141,819
(720,000)
109,295,263
US$
109,295,263
455,307
(30,279,054)
(29,823,747)
11,044,172
2,350,730
-
-
2,157,038
95,023,456
53
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR YEAR ENDED
30 JUNE 2015
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from customers
Payments to suppliers and employees
Payments for exploration and evaluation expenditure
Income taxes paid
Interest received
Interest & other finance costs
Note
Consolidated
2015
US$
13,313,284
(19,472,258)
(392,219)
(208,536)
3,390
(198,925)
2014
US$
21,786,510
(19,638,193)
(1,163,920)
(2,236,840)
10,293
(4,979,631)
Net cash outflow from operating activities
31
(6,955,264)
(6,221,781)
CASH FLOWS FROM INVESTING ACTIVITIES
Payment for property, plant & equipment
Proceeds from sale of available for sale financial assets
Payment for producing assets
Payment to investments in associates
Payments for exploration and evaluation assets
Proceeds from sale of assets held-for-sale
Receipts from loan repayments/(Loans to external parties)
(1,576,298)
450,643
(3,992,670)
-
(145,346)
5,202,379
500,000
(857,934)
-
(3,146,149)
(2,715,517)
(683,887)
-
(700,000)
Net cash inflow/(outflow) from investing activities
438,708
(8,103,487)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issue of equity
Payment of equity issue costs
Proceeds from borrowings
Repayment of borrowings
Net cash inflow from financing activities
Net increase in cash and cash equivalents
Net foreign exchange differences
Cash and cash equivalents at beginning of financial year
Cash and cash equivalents at end of financial year
9
8,890,800
-
5,250,000
-
16,002,037
(720,000)
16,407,790
(16,119,380)
14,140,800
15,570,447
7,624,244
(71,550)
2,977,410
10,530,104
1,245,179
-
1,732,231
2,977,410
The above consolidated statement of cash flows should be read in conjunction with the accompanying notes.
54
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 1: Statement of Significant Accounting Policies
These financial statements are general purpose financial statements that have been prepared in accordance with Australian
Accounting Standards, Australian Accounting Interpretations, other authoritative pronouncements of the Australian Accounting
Standards Board and the Corporations Act 2001. Range Resources Limited is a for-profit entity for the purpose of preparing
the financial statements.
The financial statements cover the Group consisting of Range Resources Limited and its controlled entities. Separate financial
statements of Range Resources Limited are no longer presented as a result of a change to the Corporations Act 2001.
Financial information for Range Resources Limited as an individual entity is disclosed in Note 34. Range Resources Limited is
a listed public company, incorporated and domiciled in Australia.
The following is a summary of the material accounting policies adopted by the Group in the preparation of the financial
statements. The accounting policies have been consistently applied, unless otherwise stated.
Basis of Preparation
Reporting Basis and Conventions
The financial statements have been prepared on an accruals basis and are based on historical costs modified by the
revaluation of selected non-current assets, and financial assets and financial liabilities for which the fair value basis of
accounting has been applied.
Compliance with IFRS
The financial statements of Range Resources Limited also comply with International Financial Reporting Standards (IFRS) as
issued by the International Accounting Standards Board (IASB). The financial statements were approved by the Board of
Directors on 29 September 2015.
Functional and presentation currency
Items included in the financial statements of each of the Group’s entities are measured using the currency of the primary
economic environment in which the entity operates (the “Functional Currency”). The consolidated financial statements are
presented in United States Dollars (USD), which is Range Resources Limited’s functional and presentation currency.
Going Concern
The Directors have prepared the financial statements on the going concern basis, which contemplates continuity of normal
business activities and the realisation of assets and discharge of liabilities in the normal course of business.
As disclosed in the financial statements, the Group incurred losses of US$30,279,054 for the year ending 30 June 2015. The
Group also had net cash outflows from operating and investing activities for the year totalling US$6,516,556, and a net current
liability position (excluding assets held for sale) of US$6,549,639.
As announced on 3 September 2015, post year end, the Group received Tranche 2 subscription proceeds of US$22.1 million
in cash from Sibo financing. This was the final cash receipt following the issue of 1,822,620,912 new ordinary shares to Beijing
Sibo Investment Management LP. In addition to this, on 11 December 2014 Range announced a proposed US$50m trade
financing with Sinosure. These funding arrangements are more than sufficient to cover Range’s cash requirements for the 12
months from date of sign-off.
The Company will seek to rationalise the portfolio of non-core assets and redeploy capital to maximise current production from
its core assets in Trinidad and pursue growth opportunities that enhance cash generation and returns to shareholders.
The financial report does not include any adjustments relating to the amounts or classification of recorded assets or liabilities
that might be necessary if the Group does not continue as a going concern.
Adoption of new and revised accounting standards
In the current year, the Group has adopted all of the new and revised Standards and Interpretations issued by the Australian
Accounting Standards Board (AASB) that are relevant to its operations and effective for the current annual reporting period.
The group has applied the following standards and amendments for the first time for their annual reporting period commencing
1 July 2014:
55
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 1:
Statement of Significant Accounting Policies (continued)
• AASB 2013-3 Amendments to AASB 136 – Recoverable Amount Disclosures for Non-Financial Assets
• AASB 2013-4 Amendments to Australian Accounting Standards – Novation of Derivatives and Continuation of Hedge
Accounting
Interpretation 21 Accounting for Levies
•
• AASB 2014-1 Amendments to Australian Accounting Standards
The adoption of these standards did not have any significant impact on the current period or any prior period and is not likely to
affect future periods.
The impact of standards and interpretations that have been published but are not mandatory for 30 June 2015 reporting
periods and have not been early adopted are disclosed within note 39. There were no standards that were early adopted as of
30 June 2015.
Significant accounting policies
The accounting policies set out below have been applied consistently to all periods presented in these consolidated financial
statements, and have been applied consistently by the Group.
(a)
Principles of consolidation
The consolidated financial statements incorporate the assets and liabilities of all subsidiaries of Range Resources
Limited (“Parent Entity” or “Company”) as at 30 June 2015 and the results of all subsidiaries for the year then ended.
Range Resources Limited and its subsidiaries together are referred to as the “Group”.
Subsidiaries are all those entities (including special purpose entities) over which the Group has control. The Group
controls an entity when the Group is exposed to, or has rights to, variable returns from its investment with the entity
and has the ability to affect those returns through its power to direct the activities of the entity.
Where controlled entities have entered or left the Group during the year, their operating results have been
included/excluded from the date control was obtained or until the date control ceased. A list of controlled entities is
contained in Note 14 to the financial statements. All controlled entities have a June financial year-end.
All inter-company balances and transactions between entities in the Group, including any unrealised profits or
losses, have been eliminated on consolidation. Accounting policies of subsidiaries have been changed where
necessary to ensure consistencies with those policies applied by the Company.
Associates are all entities over which the Group has significant influence but not control or joint control, generally
accompanying a shareholding of between 20-50% of the voting rights. Investments in associates are accounted for
in the consolidated financial statements using the equity method of accounting, after initially being recognised at
cost.
(b)
Income tax
The charge for current income tax expense is based on the profit for the year adjusted for any non-assessable or
disallowed items. It is calculated using tax rates that have been enacted or are substantively enacted by the reporting
date within each jurisdiction.
Deferred tax is accounted for using the liability method in respect of temporary differences arising between the tax
bases of assets and liabilities and their carrying amounts in the financial statements. No deferred income tax will be
recognised from the initial recognition of an asset or liability, excluding a business combination, where there is no
effect on accounting or taxable profit or loss.
Deferred tax is calculated at the tax rates that are expected to apply to the period when the asset is realised or the
liability is settled. Deferred tax is credited in profit or loss except where it relates to items that may be credited directly
to equity, in which case the deferred tax is adjusted directly against equity.
Deferred income tax assets are recognised to the extent that it is probable that future tax profits will be available
against which deductible temporary differences can be utilised.
Deferred tax liabilities and assets are not recognised for temporary differences between the carrying amount and tax
bases of investments in foreign operations where the company is able to control the timing of the reversal of the
temporary differences and it is probable that the differences will not reverse in the foreseeable future.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets and
liabilities and when the deferred tax balances relate to the same taxation authority. Current tax assets and liabilities
are
56
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 1:
Statement of Significant Accounting Policies (continued)
offset where the entity has a legally enforceable right to offset and intends either to settle on a net basis, or to realise
the asset and settle the liability simultaneously.
Current and deferred tax is recognised in profit or loss, except to the extent that it relates to items recognised in other
comprehensive income or directly in equity. In this case, the tax is also recognised in other comprehensive income or
directly in equity, respectively.
The amount of benefits brought to account or which may be realised in the future is based on the assumption that no
adverse change will occur in income taxation legislation and the anticipation that the Group will derive sufficient future
assessable income to enable the benefit to be realised and comply with the conditions of deductibility imposed by the
law.
(c)
Property, plant and equipment
Owned assets
Plant and equipment are measured on the historical cost basis less accumulated depreciation and impairment losses.
The cost of fixed assets constructed within the Group includes the cost of materials, direct labour, borrowing costs and
an appropriate proportion of fixed and variable overheads.
Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only
when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the
item can be measured reliably. All other repairs and maintenance are charged to profit or loss during the financial
period in which they are incurred.
Oil and gas assets
These properties represents the accumulation of all exploration, evaluation and development expenditure, pre-
production development costs and ongoing costs of continuing the develop reserves for production incurred by or on
behalf of the entity in relation to areas of interests.
Where further development expenditure is incurred in respect of a property after the commencement of production,
such expenditure is carried forward as part of the cost of that property only when expected future economic benefits
are to be received, otherwise such expenditure is classified as part of the cost of production.
Depreciation
The depreciable amount of all fixed assets including capitalised lease assets is depreciated on a straight-line basis
over their useful lives to the Group commencing from the time the asset is held ready for use. Leasehold
improvements are depreciated over the shorter of either the unexpired period of the lease or the estimated useful lives
of the improvements.
The depreciation rates used for each class of depreciable asset are:
Class of Fixed Asset
Plant & equipment
Production equipment
Motor vehicles, furniture & fixtures
Leasehold improvements
Depreciation Rate
11.25% - 33%
10 - 20%
25 - 33%
10 - 12.50%
The asset’s residual values and useful lives are reviewed, and adjusted if appropriate, at each reporting date.
The carrying amount of plant and equipment is reviewed annually by directors to ensure it is not in excess of the
recoverable amount from these assets. The recoverable amount is assessed on the basis of the expected net cash
flows which will be received from the asset’s employment and subsequent disposal. The expected net cash flows have
been discounted to their present values in determining recoverable amounts.
An asset’s carrying amount is written down to its recoverable amount if the asset’s carrying amount is greater than its
estimated recoverable amount.
57
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 1: Statement of Significant Accounting Policies (continued)
Gains and losses on disposals are determined by comparing proceeds with the carrying amount. These gains or
losses are included in profit or loss. When revalued assets are sold, amounts included in the revaluation reserve
relating to that asset are transferred to accumulated losses.
(d)
Exploration and evaluation expenditure and the recognition of assets
Generally, exploration and evaluation expenditure incurred is accumulated in respect of each identifiable area of
interest. These costs are only carried forward to the extent that they are expected to be recouped through the
successful development of the area or where activities in the area have not yet reached a stage that permits
reasonable assessment of the existence of economically recoverable reserves.
Accumulated costs in relation to an abandoned area are written off in full against profit in the year in which the
decision to abandon the area is made.
A regular review is undertaken of each area of interest to determine the appropriateness of continuing to carry
forward costs in relation to that area of interest.
The recoverability of the carrying amount of the exploration and evaluation assets is dependent on the successful
development and commercial exploitation, or alternatively, sale of the respective areas of interest.
The carrying values of expenditures carried forward are reviewed for impairment at each reporting date when the
facts, events or changes in circumstances indicate that the carrying value may be impaired.
Accumulated expenditures are written off to profit or loss to the extent to which they are considered to be impaired.
Range Resources Limited is applying AASB 6 Exploration for and Evaluation of Mineral Resources which is
equivalent to IFRS 6. The carrying value of exploration and evaluation expenditure is historical cost less impairment.
It’s the Group’s policy to capitalise exploration expenditure for all areas of interest apart from those in Somalia and
Colombia. Exploration costs incurred in respect of the Group’s Somalian and Colombian interests are expensed as
incurred.
(e)
Producing assets
Upon the commencement of commercial production from each identifiable area of interest, the exploration and
evaluation expenditure incurred up to that point is impairment tested and then reclassified to producing assets.
When production commences, the accumulated costs for the relevant area of interest are amortised on a units of
production method based on the ratio of actual production to remaining proved reserves (P1) as estimated by
independent petroleum engineers over the life of the area according to the rate of depletion of the economically
recoverable reserves.
Subsequent costs are included in the asset’s carrying amount, only when it is probable that future economic benefits
associated with the item will flow to the Group and the cost of the item can be measured reliably. All other repairs and
maintenance are charged to profit and loss during the financial period in which they are incurred.
The carrying amount of producing assets is reviewed annually by directors to ensure it is not in excess of the
recoverable amount from these assets. The recoverable amount of an asset is the greater of its fair value less costs to
sell and its value in use. In assessing value in use, an asset’s estimated future cash flows are discounted to their
present value using a post-tax discount rate that reflects current market assessments of the time value of money and
the risks specific to the asset. Where an asset does not generate cash flows that are largely independent from other
assets or groups of assets, the recoverable amount is determined for the cash generating unit to which the asset
belongs. For producing assets, the estimated future cash flows for the value-in-use calculation are based on
estimates, the most significant of which are 2P hydrocarbon reserves, future production profiles, commodity prices,
operating costs and any future development costs necessary to produce the reserves. Under a fair value less costs to
sell calculation, future cash flows are based on estimates of 2P hydrocarbon reserves. Estimates of future commodity
prices are based on the Group’s best estimate of future market prices with reference to external market analysts’
forecasts, current spot prices and forward curves. Future commodity prices are reviewed at least annually.
An asset’s carrying amount is written down to its recoverable amount if the asset’s carrying amount is greater than its
estimated recoverable amount.
58
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 1: Statement of Significant Accounting Policies (continued)
Gains and losses on disposals are determined by comparing proceeds with the carrying amount. These gains or
losses are included in profit or loss. When revalued assets are sold, amounts included in the revaluation reserve
relating to that asset are transferred to accumulated losses.
The Group records the present value of the estimated cost of legal and constructive obligations to restore operating
locations in the period in which the obligation arises. The nature of restoration activities includes the removal of
facilities, abandonment of wells and restoration of affected areas. A restoration provision is recognised and updated at
different stages of the development and construction of a facility and then reviewed on an annual basis. When the
liability is initially recorded, the estimated cost is capitalised by increasing the carrying amount of the related
exploration and evaluation/development assets.
Over time, the liability is increased for the change in the present value based on a post-tax discount rate appropriate
to the risk inherent in the liability. The unwinding of the discount is recorded as an accretion charge within finance
costs. The carrying amount capitalised in oil and gas properties is depreciated over the useful life of the related
asset.
Costs incurred that relate to an existing condition caused by past operation and do not have a future economic
benefit are expensed.
(f)
Financial instruments
The Group’s financial instruments include cash and cash equivalents, trade and other receivables and available-for-
sale financial assets.
Recognition
Financial instruments are initially measured at cost on trade date, which includes transaction costs, when the related
contractual rights or obligations exist. Subsequent to initial recognition, these instruments are measured as set out
below.
The Group classifies its financial assets in the following categories: loans and receivables and available-for-sale
investments. The classification depends on the purpose for which the investments were acquired. Management
determines the classification of its investments at initial recognition.
Loans and receivables
Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in
an active market and are stated at amortised cost using the effective interest rate method.
Available-for-sale financial assets
Available-for-sale financial assets include non-derivative financial assets designated in this category not included in
any of the other categories. Available-for-sale financial assets are reflected at fair value. Unrealised gains and losses
arising from changes in fair value are taken directly to the available for sale investment revaluation reserve in equity.
Investments are designated as available-for-sale if they do not have fixed maturities and fixed determinable payments
and management intends to hold them for the medium to long term.
Fair value
Fair value is determined based on current bid prices for all quoted investments. Valuation techniques are applied to
determine the fair value for all unlisted securities held at cost less impairment, including recent arm’s length
transactions, reference to similar instruments and option pricing models.
Changes in the fair value of monetary securities denominated in a foreign currency and classified as available-for-sale
are analysed between translation differences resulting from changes in amortised cost of the security and other
changes in the carrying amount of the security. The translation differences related to changes in the amortised cost
are recognised in profit or loss, and other changes in carrying amount are recognised in the available for sale
investment revaluation reserve in equity. Changes in the fair value of other monetary and non-monetary securities
classified as available-for-sale are recognised in equity.
Impairment of assets
The Group assesses at each reporting date whether there is objective evidence that a financial asset or group of
financial assets is impaired. In the case of equity securities classified as available-for-sale, a significant or prolonged
decline in the fair value of a security below its cost is considered an indicator that the securities are impaired. If any
59
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 1: Statement of Significant Accounting Policies (continued)
such evidence exists for available-for-sale financial assets, the cumulative loss – measured as the difference between
the acquisition cost and the current fair value, less any impairment loss on that financial asset previously recognised in
profit or loss – is removed from equity and included in profit or loss. Impairment losses recognised in the statement of
profit or loss and other comprehensive income on equity instruments classified as available-for-sale are not reversed
through profit or loss.
Recognition and de-recognition
Regular purchases and sales of financial assets are recognised on trade-date – the date on which the Group commits
to purchase or sell the asset. Investments are initially recognised at fair value plus transaction costs. Financial assets
are de-recognised when the rights to receive cash flows from the financial assets have expired or have been
transferred and the Group has transferred substantially all the risks and reward of ownership.
When the securities classified as available-for-sale are sold, the accumulated fair value adjustments recognised in
equity are included in profit or loss as gains and losses for investment securities.
(g)
Foreign currency transactions and balances
Functional and presentation currency
The functional currency of each entity within the Group is determined using the currency of the primary economic
environment in which that entity operates. The consolidated financial statements are presented in United States
dollars which is the Company’s functional and presentation currency.
Transaction and balances
Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the
date of the transaction. Foreign currency monetary items are translated at the year-end exchange rate. Non-monetary
items measured at historical cost continue to be carried at the exchange rate at the date of the transaction. Non-
monetary items measured at fair value are reported at the exchange rate at the date when fair values were
determined.
Exchange differences arising on the translation of monetary items are recognised in profit or loss.
Exchange differences arising on the translation of non-monetary items are recognised directly in equity to the extent
that the gain or loss is directly recognised in equity; otherwise the exchange difference is recognised in profit or loss.
(h)
Provisions
Provisions for legal claims, service warranties and make good obligations 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 the amount has been reliably estimated. Provisions are not recognised for future
operating losses.
Where there are a number of similar obligations, the likelihood that an outflow will be required in settlement is
determined by considering the class of obligations as a whole. A provision is recognised even if the likelihood of an
outflow with respect to any one item included in the same class of obligations may be small.
Provisions are measured at the present value of management’s best estimate of the expenditure required to settle the
present obligation at the reporting date. The discount rate used to determine the present value reflects the current
market assessments of the time value of money and the risk specific to the liability. The increase in the provision due
to the passage of time is recognised as interest expense.
(i)
Cash and cash equivalents
Cash and cash equivalents includes cash on hand, deposits held at call with banks, other short-term highly liquid
investments with original maturities of three months or less that are readily convertible to known amounts of cash and
which are subject to insignificant risk of changes in value, and bank overdrafts. Bank overdrafts are shown within
short-term borrowings in current liabilities on the statement of financial position.
60
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 1:
Statement of Significant Accounting Policies (continued)
(j)
Trade receivables
Trade receivables are recognised initially at fair value and subsequently measured at amortised cost using the
effective interest method, less provision for impairment. Trade receivables are generally due for settlement within 30
days.
Collectability of trade receivables is reviewed on an ongoing basis. Debts which are known to be uncollectible are
written off by reducing the carrying amount directly. An allowance account (provision for impairment of trade
receivables) is used when there is objective evidence that the Group will not be able to collect all amounts due,
according to the original terms of the receivables. Significant financial difficulties of the debtor, probability that the
debtor will enter bankruptcy or financial reorganisation, and default or delinquency in payments (more than 30 days
overdue) are considered indicators that the trade receivable is impaired. The amount of impairment allowance is the
difference between the asset’s carrying amount and the present value of estimated future cash flows, discounted at
the original effective interest rate. Cash flows relating to short-term receivables are not discounted if the effect of
discounting is immaterial.
The amount of impairment loss is recognised in profit or loss within other expenses. When a trade receivable, for
which an impairment allowance had been recognised, becomes uncollectible in a subsequent period, it is written off
against the allowance account. Subsequent recoveries of amounts previously written off are credited against other
expenses in profit or loss.
(k)
Revenue recognition
Revenue is measured at the fair value of the consideration received or receivable. Amounts disclosed as revenue are
net of returns, trade allowances, rebates and amounts collected on behalf of third parties. Revenue is recognised
when the amount of revenue can be reliably measured, and it is probable that future economic benefits will flow to the
Group.
Revenue from the sale of oil and gas and related products is recognised when the Group has transferred to the buyer
the significant risks and rewards of ownership and the amounts can be measured reliably. In the case of oil, this
usually occurs at the time of lifting.
Interest revenue is recognised on a time proportion basis taking into account the interest rates applicable to the
financial assets.
(l)
Goods and Services Tax (GST)
Revenues, expenses and assets are recognised net of the amount of GST, except where the amount of GST incurred
is not recoverable from the Australian Tax Office. In these circumstances the GST is recognised as part of the cost of
acquisition of the asset or as part of an item of the expense. Receivables and payables in the statement of financial
position are shown inclusive of GST.
Cash flows are presented in the consolidated statement of cash flows on a gross basis, except for the GST
component of investing and financing activities, which are disclosed as operating cash flows.
(m)
Comparative figures
When required by Accounting Standards, comparative figures have been adjusted to conform to changes in
presentation for the current financial year.
61
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 1: Statement of Significant Accounting Policies (continued)
(n)
Fair value estimation
The fair value of financial assets and financial liabilities must be estimated for recognition and measurement for
disclosure purposes.
The fair value of financial instruments traded in active markets (such as publicly traded derivatives, and trading and
available-for-sale securities) is based on quoted market prices at the reporting date. The quoted market price used for
financial assets held by the Group is the current bid price.
The fair value of financial instruments that are not traded in an active market (for example over-the-counter
derivatives) is determined using valuation techniques. The Group uses a variety of methods and makes assumptions
that are based on market conditions existing at each reporting date.
The carrying value less impairment provision of trade receivables and payables are assumed to approximate their fair
values due to their short-term nature. The fair value of financial liabilities for disclosure purposes is estimated by
discounting the future contractual cash follows at the current market interest rate that is available to the Group for
similar financial instruments.
(o)
Investments in associates
Investments in associates are accounted for using the equity method of accounting in the consolidated financial
statements.
Under the equity method, the investment in the associate is carried in the consolidated statement of financial position
at cost plus post-acquisition changes in the Group’s share of net assets of the associate.
After application of the equity method, the Group determines whether it is necessary to recognise any additional
impairment loss with respect to the Group’s net investment in the associate.
The Group's share of the associate post-acquisition profits or losses is recognised in the statement of profit or loss and
other comprehensive income. The cumulative post-acquisition movements are adjusted against the carrying amount of
the investment. When the Group's share of losses in the associate equals or exceeds its interest in the associate,
including any unsecured long-term receivables and loans, the Group does not recognise further losses, unless it has
incurred obligations or made payments on behalf of the associate.
The reporting dates of the associate and the Group are identical and the associate’s accounting policies conform to
those used by the Group for like transactions and events in similar circumstances.
(p)
Prepayments for investments
Prepayments for acquisitions of financial assets are recorded at the fair value of consideration to acquire the assets.
On satisfaction of all terms of the acquisition contract have been satisfied the prepayment is transferred and accounted
for as an investment.
(q)
Trade and other payables
These amounts represent liabilities for goods and services provided to the Group prior to the end of financial year
which are unpaid. The amounts are unsecured and are usually paid within 30 days of recognition.
(r)
Dividends
Provision is made for the amount of any dividend declared, being appropriately authorised and no longer at the
discretion of the entity, on or before the end of the financial year but not distributed at reporting date.
(s)
Contributed equity
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options
are shown in equity as a deduction, net of tax, from the proceeds.
62
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 1:
Statement of Significant Accounting Policies (continued)
(t)
Earnings per share
(i) Basic earnings per share
Basic earnings per share is calculated by dividing the profit or loss attributable to equity holders of the Company,
excluding any costs of servicing equity other than ordinary shares, by the weighted average number of ordinary shares
outstanding during the financial year, adjusted for bonus elements in ordinary shares issued during the year.
(ii) Diluted earnings per share
Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into
account the after income tax effect of interest and other financing costs associated with dilutive potential ordinary
shares.
(u)
Segment reporting
Operating segments are reported in a manner consistent with the internal reporting to the chief operating decision
maker. The chief operating decision maker, who is responsible for allocating resources and assessing performance of
the operating segments, has been identified as the managing director.
(v)
Impairment of assets
Goodwill and intangible assets that have an indefinite useful life are not subject to amortisation and are tested annually
for impairment, or more frequently if events or changes in circumstances indicate that they might be impaired. Other
assets are tested for impairment whenever events or changes in circumstances indicate that the carrying amount may
not be recoverable. An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds
its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell and value in
use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which they are separately
identifiable cash inflows which are largely independent of the cash inflows from other assets or groups of assets (cash-
generating units). Non-financial assets other than goodwill that suffered an impairment are reviewed for possible
reversal of the impairment at the end of each reporting period.
(w)
Intangible assets (goodwill)
Goodwill is measured as described in note 1(v). Goodwill on acquisitions of subsidiaries is included in intangible
assets. Goodwill is not amortised but it is tested for impairment annually or more frequently if events or changes in
circumstances indicate that it might be impaired, and is carried at cost less accumulated impairment losses. Gains
and losses on the disposal of an entity include the carrying amount of goodwill relating to the entity sold.
Goodwill is allocated to cash-generating units for the purpose of impairment testing. The allocation is made to those
cash-generating units or groups of cash-generating units that are expected to benefit from the business combination in
which the goodwill arose, identified according to operating segments (note 30).
(x)
Share-based payments
The fair value of options granted is recognised as an expense with a corresponding increase in equity. The total
amount to be expensed is determined by reference to the fair value of the options granted, which includes any market
performance conditions and the impact of any non-vesting conditions but excludes the impact of any service and non-
market performance vesting conditions.
(y)
Employee benefits
Wages and salaries and annual leave
Liabilities for wages and salaries, including non-monetary benefits are recognised in current liabilities in respect of
employees’ services up to the reporting date and are measured at the amounts expected to be paid when the liabilities
are settled.
Long service leave
The liability for long service leave is recognised in current and non-current liabilities, depending on the unconditional
right to defer settlement of the liability for at least 12 months after the reporting date. The liability is measured as the
present value of expected future payments to be made in respect of services provided by employees up to the
reporting date using the projected unit credit method. Consideration is given to expected future wage and salary
levels, experience of employee departures and periods of service.
63
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 1:
Statement of Significant Accounting Policies (continued)
(z)
Leases
The determination of whether an arrangement is or contains a lease is based on the substance of the arrangement
and requires an assessment of whether the fulfilment of the arrangement is dependent on the use of a specific asset
or assets and the arrangement conveys a right to use the asset.
A distinction is made between finance leases, which effectively transfer from the lessor to the lessee substantially all
the risks and benefits incidental to ownership of leased assets, and operating leases, under which the lessor
effectively retains substantially all such risks and benefits.
Finance leases are capitalised. A lease asset and liability are established at the fair value of the leased assets, or if
lower, the present value of minimum lease payments. Lease payments are allocated between the principal
component of the lease liability and the finance costs, so as to achieve a constant rate of interest on the remaining
balance of the liability.
Leased assets acquired under a finance lease are depreciated over the asset’s useful life or over the shorter of the
asset’s useful life and the lease term if there is no reasonable certainty that the company will obtain ownership at the
end of the lease term.
Operating lease payments, net of any incentives received from the lessor, are charged to profit or loss on a straight-
line basis over the term of the lease.
(aa)
Borrowings
Loans and borrowings are initially recognised at the fair value of the consideration received, net of transaction costs.
They are subsequently measured at amortised cost using the effective interest method.
Where there is an unconditional right to defer settlement of the liability for at least 12 months after the reporting date,
the loans or borrowings are classified as non-current.
(bb)
Compound Financial Instruments
Compound financial instruments issued by the Group comprise convertible notes that can be converted to ordinary
shares at the option of the holder, when the number of shares to be issued is fixed.
The liability component of a compound financial instrument is recognised initially at the fair value of a similar liability
that does not have an equity conversion option. The equity component is recognised initially at the difference between
the fair value of the compound financial instrument as a whole and the fair value of the liability component. Any
directly attributable transaction costs are allocated to the liability and equity components in proportion to their initial
carrying amounts.
Subsequent to initial recognition, the liability component of a compound financial instrument is measured at amortised
cost using the effective interest method. The equity component of a compound financial instrument is not remeasured
subsequent to initial recognition.
Interest related to the financial liability is recognised in profit or loss. On conversion the financial liability is reclassified
to equity and no gain or loss is recognised.
Convertible notes that can be converted to share capital at the option of the holder and where the number of shares is
variable, contains an embedded derivative liability. The embedded derivative liability is calculated (at fair value) first
and the residual value is assigned to the debt host contract. The embedded derivative is subsequently measured at
fair values and movements are reflected in the profit and loss.
Certain convertible notes issued by the Group which include embedded derivatives (option to convert to variable
number of shares in the Group are recognised as financial liabilities at fair value through profit or loss. On initial
recognition, the fair value of the convertible note will equate to the proceeds received and subsequently the liability is
measured at fair value at each reporting period until settlement. The fair value movements are recognised on the
profit and loss as finance costs.
(cc)
Finance costs
Finance costs attributable to qualifying assets are capitalised as part of the asset. All other finance costs are expensed
in the period in which they are incurred.
64
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 1:
Statement of Significant Accounting Policies (continued)
(dd)
Non-current assets classified as held for sale
Non-current assets are classified as held for sale if their carrying amount will be recovered principally through a sale
transaction rather than through continuing use. They are measured at the lower of their carrying amount and fair value
less costs to sell. For non-current assets to be classified as held for sale, they must be available for immediate sale in
their present condition and their sale must be highly probable.
An impairment loss is recognised for any initial or subsequent write down of the non-current assets to fair value less
costs to sell. A gain is recognised for any subsequent increases in fair value less costs to sell of a non-current asset,
but not in excess of any cumulative impairment loss previously recognised.
Non-current assets are not depreciated or amortised while they are classified as held for sale. Interest and other
expenses attributable to the liabilities of assets held for sale continue to be recognised.
Non-current assets classified as held for sale are presented separately on the face of the consolidated statement of
financial position, in current assets. The liabilities of disposal groups classified as held for sale are presented
separately on the face of the statement of financial position, in current liabilities.
(ee)
Discontinued operations
A discontinued operation is a component of the Group’s business, the operations and cash flows of which can be
clearly distinguished from the rest of the Group and which:
-
-
is part of a single co-ordinated plan to dispose of a separate major line of business or geographical are of
operations.
represents a separate major line of business or geographical area of operations
-
is a subsidiary acquired exclusively with a view to re-sale.
Classification as a discontinued operation occurs at the earlier of disposal or when the operation meets the criteria to
be classified as held-for-sale.
When an operation is classified as a discontinued operation, the comparative consolidated statement of profit or loss
and other comprehensive income is re-presented as if the operation had been discontinued from the start of the
comparative year.
Note 2:
Critical accounting estimates and judgements
The directors evaluate estimates and judgements incorporated into the financial statements based on historical knowledge and
best available current information. Estimates assume a reasonable expectation of future events and are based on current trends
and economic data, obtained both externally and within the Group. Areas involving a higher degree of judgement or complexity,
or areas where estimations and assumptions are significant to the financial statements are disclosed here.
Exploration and evaluation expenditure
Exploration and evaluation expenditure for each area of interest is carried forward as an asset provided certain conditions listed
in Note 1(d) are met. Exploration and evaluation assets are assessed for impairment when facts and circumstances suggest that
the carrying amount of an exploration and evaluation asset may exceed its recoverable amount. These calculations and reviews
require the use of assumptions and judgement. The related carrying amounts are disclosed in Note 17.
Producing asset expenditure
The classification of exploration and evaluation expenditure to producing assets is based on the time of first commercial
production. Producing asset expenditure for each area of interest is carried forward as an asset provided certain conditions listed
in Note 1(e) are met and depreciated on a unit of production basis on P1 reserves. P1 reserves have been determined by an
independent expert.
Producing assets are assessed for impairment when facts and circumstances suggest that the carrying amount of a production
asset may exceed its recoverable amount. These timings, calculations and reviews require the use of assumptions and
judgement. The related carrying amounts are disclosed in Note 18.
65
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 2:
Critical accounting estimates and judgements (continued)
Investment in associate – LAR
In January 2013, Range acquired a stake in Citation Resources Limited (ASX: CTR) which held a 70% interest in Latin American
Resources (“LAR”). Subsequently, Range acquired a direct 20% interest in LAR.
As at 30 June 2014, Range had a 6.33% interest in CTR and CTR had a 60% interest in LAR. Combined with the direct
shareholding this gives Range an effective 24% interest in LAR, giving Range significance influence over the group. At 30 June
2014 the carrying value of the Group’s 20% interest in LAR has been impaired down to US$2,779,476 which represents the
Group’s share of 20% of LAR net assets – refer Note 19. The impairment recognised in relation to LAR at 30 June 2014 was
US$1,410,138, which is included in the consolidated statement of profit or loss and other comprehensive income within assets
written-off.
During the year ended 30 June 2015, the asset was written down by a further US$600,118 to a value of US$2,179,358 and
transferred to assets held for sale following the board’s decision to actively market the asset. Once transferred to held for sale, a
further write down of US$1,179,358 to US$1,000,000 was recognised
Provision for impairment of trade and other receivables
During the prior year, and given uncertainty over the counterparty’s ability to repay, a provision for impairment of US$2,489,443
was recognised in relation to miscellaneous other receivables totalling US$3,179,394. A further provision of $17,937 was
recognised in the current financial year.
Provision for impairment of other non-current receivable
In the year ended 30 June 2014, the Company recognised an impairment of US$7,354,469 with respect to the loan which had
been advanced to International Petroleum Limited, reducing the carrying value of the loan to US$1,500,000 at 30 June 2014 as
set out in note 20. US$500,000 of the balance was received in the year ended 30 June 2015, with the remaining balance
exchanged into equity in IOP with a carrying value of $346,000.
Impairment of goodwill and producing assets
The Group tests annually whether goodwill or the producing assets has suffered any impairment in accordance with the
accounting policies stated in notes 1(e) and 1(w). The recoverable amount of the cash-generating unit to which the assets
belong is estimated based on the present value of future cash flows. The expected future cash flow estimation is always based
on a number of factors, variables and assumptions, the most important of which are estimates of reserves, future production
profiles, commodity prices and costs. In most cases, the present value of future cash flows is most sensitive to estimates of
future oil price and discount rates. A change in the modelled assumptions in isolation could materially change the
recoverable amount. Refer to note 15 for details of these key assumptions.
Deferred tax liability
Upon acquisition of SOCA Petroleum Ltd, in accordance with the requirement of AASB 112 Income Taxes, a deferred tax liability
of US$46,979,878 was recognised in relation to the difference between the carrying amount for accounting purposes of deferred
development assets and their actual cost base for tax purposes. The carrying value of this deferred tax liability has reduced to
US$43,359,199 at 30 June 2015. In the event that the manner by which the carrying value of these assets is recovered differs
from that which is assumed for the purpose of this estimation, the associated tax charges may be significantly less than this
amount.
Impairment of assets held-for-sale
An impairment loss in respect of assets held-for-sale is generally measured at the lower of their carrying amount and fair value
less costs to sell. Impairment losses on initial classification as held-for-sale and subsequent gains and losses on re-
measurement are recognised in profit or loss. Once classified as held-for-sale, intangible assets and property, plant and
equipment are no longer amortised or depreciated, and any equity-accounted investee is no longer equity accounted.
During 2014, as part of the Company’s strategy to rationalise non-core assets, the Company committed to a plan to dispose its
shares in Strait Oil & Gas (UK) Limited (“Strait”).
In the current financial year, Range decided to actively market its Guatemalan assets for sale.
At 30 June 2015 impairment losses of US$34,281,987 and US$1,779,476 have been recognised in respect of Strait and the
Guatemalan asset, respectively.
66
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 2:
Critical accounting estimates and judgements (continued)
Share based payments transactions
The Group measures the cost of equity-settled share-based payment transactions with employees by reference to the fair value
of the equity instruments at the grant date. The fair value is determined using a Black-Scholes model. The accounting estimates
and assumptions relating to equity-settled share-based payments would have no impact on the carrying amounts of assets and
liabilities within the next annual reporting period but may impact expenses and equity.
Classification of operations to discontinued
The assets classified as discontinued operations represent separate major lines of business and geographical areas of
operations.
Note 3: Revenue
From continuing operations
−
revenue from sale of oil
Other income
−
−
interest income (i)
other income
Consolidated
2015
US$
2014
US$
13,152,954
21,185,745
3,390
422,198
425,588
1,217,890
3,218
1,221,108
(i) 2014 figure relates primarily to the loan facility and interest revenue as per final settlement agreement between
Citation Resources Ltd and the Group.
Note 4: Expenses
(a)
Loss before income tax includes the following specific expenses:
Cost of sales
− Costs of production
− Royalties
− Staff costs
− Oil and gas properties depreciation, depletion and amortisation
− Amortisation in relation to fair value uplift of oil properties on
business combination
(b)
Expenses
Interest and premium paid on financial liabilities at fair value
Finance costs
−
− Fair value movement of option liability
− Facility fees settled in shares
−
Loss on equity swap
−
Interest expense
− Corporate advisory fee
Total finance costs
Consolidated
2015
US$
2014
US$
3,125,464
4,654,241
3,315,271
1,781,212
4,705,948
7,353,237
4,843,662
1,687,468
3,135,840
16,012,028
6,222,477
24,812,792
2,550,028
(127,883)
1,575,637
-
349,793
-
4,347,575
11,199,869
2,123,709
3,494,570
2,902,249
2,077,382
21,797,779
67
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 4: Expenses (continued)
General and administration expenses
− Consultants
− Other expenses
− Share based payments
− Share based payments –employee and consultant shares
− Foreign exchange (gain)/loss
− Directors’ and officers’ fees and benefits
− Travel expenditure
−
Legal fees
− Corporate management services
−
− Marketing and public relations
− Share registry expenses and listing costs
− Audit fees
− Depreciation
−
− Taxation advice
Total general and administration expenses
Loss on disposal of available for sale asset
Insurance
(c)
Asset values written-down
Asset values written-down
−
−
−
−
−
−
Total assets written-down
Impairment of restricted deposits
Impairment of current receivables
Impairment of non-current receivables
Impairment of investment in associate
Impairment of Colombian exploration expenditure
Impairment of investment in available for sale financial assets
(d)
Exploration Expenditure
Puntland
Trinidad (i)
Colombia
Total exploration expenses
(e)
Loss on disposal of subsidiary
Range Resources Drilling Limited
Total loss on disposal
Details of loss on sale of subsidiaries
Consideration received
Carrying amount of net assets sold
Loss on sale
Reclassification of FX reserve
Income tax expense on gain
Loss on sale
1,964,024
1,205,399
2,157,037
580,455
(134,789)
999,571
585,994
552,459
303,327
259,384
200,134
402,824
271,754
1,192
496,958
102,771
9,948,494
-
17,937
20,992
-
-
654,000
692,929
3,421,400
1,597,262
1,673,558
-
1,468,581
1,115,524
1,113,233
1,293,946
780,718
568,931
461,902
655,537
225,040
62,224
-
47,998
14,485,854
3,480,000
2,489,443
6,549,517
1,410,138
9,613,918
724,952
24,267,968
314,982
1,810,529
77,237
2,202,748
1,163,920
-
-
1,163,920
1,491,857
1,491,857
-
-
4,870,000
6,319,358
(1,449,358)
(42,499)
-
(1,491,857)
(i)
Amounts expensed in the year in Trinidad relate to land fees in relation to Guayaguayare and St Mary’s for which the
company policy is to expense.
68
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 5: Discontinued operations
In 2013, the Company indicated that it was in the process of disposing of the Company’s North Chapman Ranch and East
Texas Cotton Valley assets hence the transfer from producing assets to assets classified as held-for-sale in that accounting
period. This sale was completed on 24 March 2015 through a disposal of Range Australia Resources (US) Limited.
During the 2014 financial year, the Company also committed to a plan to dispose its shares in the unlisted company Strait Oil
& Gas (UK) Limited, representing 45% of the shares on issue of Strait to place greater focus on the Group’s core producing
assets in Trinidad. This has been written down by a further US$5,000,000 in the current financial period (2014:
US$29,281,987) as Range continues to search for a buyer for the asset.
Impairment losses of US$6,779,476 (2014 - US$37,244,836) for write-downs of the disposal group to the lower of its carrying
amount and its recoverable amount have been included in loss on discontinued operations (see note 5a). The impairment
losses have been applied to reduce the carrying amount of the assets held-for-sale within the disposal group. There is no
cumulative income or expenses included in other comprehensive income relating to the disposal group.
(a) Results of discontinued operations
Revenue
Cost of sales
Asset write off
Other expenses
Results from operating activities
Income tax (expense)/benefit
Results from operating activities, after tax
Loss on sale of subsidiary asset
Loss from discontinued operations
2015
US$
2014
US$
238,194
(104,799)
(6,779,476)
(949,169)
(7,595,250)
-
(7,595,250)
(101,909)
(7,697,159)
553,965
(97,652)
(37,244,836)
(610,285)
(37,398,808)
544,298
(36,854,510)
-
(36,854,510)
The loss from the discontinued operations of US$7,697,159 (2014: US$36,854,510) is attributable
entirely to the owners of the Company.
(b) Cash flows gained from/(used in) discontinued operations
Net cash used in operating activities
Net cash flow for the year
(801,003)
(801,003)
(2,069,088)
(2,069,088)
(c) Details of sale of Range Australia Resources (US) Limited
Consideration received
-Cash
-Debts forgiven
-Shares
Total disposal consideration
Less: Carrying amount of net assets sold
Loss on sale
Income tax expense on gain
Loss on sale
389,172
147,311
155,885
692,368
(794,277)
(101,909)
-
(101,909)
69
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 6: Income Tax Expense
(a)
Income tax expense
Current tax
Deferred tax
Adjustments for current tax of prior periods
Income tax expense/(benefit) is attributable to:
Profit/(loss) from continuing operations
Profit/(loss) from discontinued operations
Aggregate income tax expense
(b)
The prima facie tax on profit from ordinary
activities before income tax is reconciled to
the income tax as follows:
Prime facie tax payable on profit from ordinary
activities before income tax at 30% (2014: 30%)
− Group
Add:
Tax effect of:
− Other taxes
− Expenses not deductible for tax
−
Income not assessable for tax
− Tax losses not brought to account
− Benefit of tax losses not previously
recognised
− Deferred tax assets not brought to account
− Differences in tax rates
− Prior year adjustment
Unrecognised Deferred tax asset
− Capital losses
− Revenue losses
− Other
Consolidated
2015
US$
2014
US$
624,618
843,188
-
1,467,806
1,467,806
-
1,467,806
1,753,045
(865,005)
(525,718)
362,322
906,618
(544,296)
362,322
(28,811,248)
(102,179,666)
(8,643,374)
(8,643,374)
(30,653,900)
(30,653,900)
477,852
7,752,706
(3,757,145)
1,938,572
3,608,262
2,315,848
(2,224,915)
-
1,467,806
1,084,219
10,033,815
3,265,732
14,383,766
2,065,308
29,066,976
(4,061,284)
494,731
2,128,535
2,835,615
(987,941)
(525,718)
362,322
295,658
8,797,175
1,068,076
10,160,909
Deferred tax assets not brought to account, the benefits of which will only be realised if the conditions for deductibility set out in
Note 1(b) occur.
70
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 6: Income Tax Expense (continued)
(c)
Recognised deferred tax assets
-
temporary differences
Recognised deferred tax liabilities
-
-
Accelerated depreciation
DTL arising on business combination
Net deferred tax liabilities
Consolidated
2015
US$
2014
US$
286,693
286,693
462,325
462,325
(11,039,440)
(9,365,463)
(32,319,759)
(35,010,570)
(43,359,199)
(44,376,033)
Deferred tax assets not brought to account, the benefits of which will only be realised if the conditions for deductibility set out in
Note 1(b) occur.
Note 7: Auditors’ Remuneration
Remuneration of the auditor of the Parent Entity for:
-
-
auditing or reviewing the financial report by BDO Audit (WA) Pty Ltd
non-audit services provided by a related entity of BDO Audit (WA) Pty Ltd in respect
to Parent Entity’s tax compliance.
Total remuneration for the Parent Entity
Remuneration of the auditors of the subsidiaries:
-
-
-
auditing or reviewing the financial report by BDO UK
auditing or reviewing the financial report by BDO Barbados
auditing or reviewing the financial report by BDO Trinidad
Total remuneration for the subsidiaries
Consolidated
2015
US$
2014
US$
216,866
144,894
72,570
289,436
47,998
192,892
3,933
13,030
40,530
57,493
-
15,697
64,449
80,146
71
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 8: Earnings Per Share
(a)
Basic loss per share
(Loss) per share from continuing operations attributable to the ordinary equity
holders of the company
(Loss) per share attributable to the ordinary equity holders of the company
(b)
Diluted loss per share
(Loss) per share from continuing operations attributable to the ordinary equity
holders of the company
(Loss) per share attributable to the ordinary equity holders of the company
(c)
Reconciliation of loss used in calculating earnings per share
Consolidated
2015
US cents
2014
US cents
(0.44)
(0.59)
n/a
n/a
(1.85)
(2.89)
n/a
n/a
Basic/ Diluted loss per share
Loss from continuing operations attributable to the ordinary equity holders of
the company
(22,581,895)
(65,687,480)
Loss attributable to the ordinary equity holders of the company
(30,279,054)
(102,541,990)
(d)
Weighted average number of shares used as the denominator
2015
No.
2014
No.
Weighted average number of ordinary shares used as the denominator in
calculating basic EPS
5,095,406,444
3,553,499,382
Effect of dilutive securities
Options on issue at reporting date could potentially dilute earnings per share in the future. The effect in the current year is to
reduce the loss per share hence they are considered anti-dilutive. Accordingly the diluted loss per share has not been disclosed.
Note 9: Cash and Cash Equivalents
Cash at bank and on hand
Risk exposure
Consolidated
2015
US$
2014
US$
10,530,104
2,977,410
Information about the Group’s exposure to credit risk, foreign exchange risk and price risk is provided in Note 35.
72
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 10: Trade and Other Receivables
Current
Other receivables
- trade receivables (i)
- accrued revenue (ii)
- goods and services tax
- other debtors (iii)
- less: provision for impairment
Consolidated
2015
US$
2014
US$
672,331
-
3,820,265
3,145,825
(2,489,443)
1,258,117
102,825
3,287,876
3,179,394
(2,489,443)
5,148,978
5,338,769
Fair value approximates the carrying value of trade and other receivables at 30 June 2015 and 30 June 2014.
(i)
Trade receivables are generally due for settlement within 30 days. They are presented as current assets unless
collection is not expected for more than 12 months after the reporting date. Trade receivables are neither past due nor
impaired.
(ii) Accrued revenues relate to the Petrotrin overriding royalty refundable in the Trinidad subsidiaries.
(iii) Other debtors are comprised primarily of advances to unrelated third parties. Given the uncertainty over the
likelihood of repayment these advances have been included within the provision for impairment raised at 30 June
2015 and 30 June 2014.
Risk exposure
Information about the Group’s exposure to credit risk, foreign exchange risk and price risk is provided in Note 35.
Note 11: Other Current Assets
Current
Prepayments
Other assets
Note 12: Assets Held-for-Sale
Assets classified as held for sale are as follows:
Strait Oil & Gas (UK) Limited – 45% equity interest
Range Australia Resources (US) Limited – 100% owned subsidiary
Latin American Resources – 20% equity interest
Total
Consolidated
2015
US$
2014
US$
352,724
430,661
783,385
728,544
-
728,544
Consolidated
2015
US$
5,000,000
-
1,000,000
6,000,000
2014
US$
10,000,000
1,000,000
-
11,000,000
73
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 12: Assets Held-for-Sale (continued)
Movements in assets classified as held for sale are as follows:
Opening net book amount
Transfer from investment in associate (note 19)
Additions
Sold in period
Impairment loss relating to discontinued operations
Closing net book amount
11,000,000
2,179,358
-
(1,000,000)
(6,179,358)
8,769,792
39,281,987
193,057
-
(37,244,836)
6,000,000
11,000,000
Impairment losses of US$6.8 million for write-downs of the disposal group to the lower of its carrying amount and its
recoverable amount have been included in ‘loss on discontinued operations’ (see note 5). The impairment losses have been
applied to reduce the carrying amount of the assets held-for-sale within the disposal group. There is no cumulative income or
expenses included in other comprehensive income relating to the disposal group.
Note 13: Financial Assets Available-For-Sale
Listed investments, at fair value
-
Interest in other corporations
Total available-for-sale financial assets
Movement in Financial Assets Available-for-
Sale
Opening balance
Shares received on settlement of loan receivable
Acquisitions
Shares disposed of to settle liabilities
Foreign exchange variance
Shares sold in period
Fair value movement recognised in equity
Transferred from other current assets (note 20)
Impairment recognised in profit and loss
Closing balance
Consolidated
2015
US$
446,000
446,000
2014
US$
876,347
876,347
876,347
171,254
-
-
-
(947,601)
-
1,000,000
(654,000)
446,000
822,751
3,762,367
1,207,598
(3,720,555)
59,021
-
(529,883)
-
(724,952)
876,347
Available-for-sale financial assets comprise investments in the ordinary share capital of various entities. There are no fixed
returns or fixed maturity date attached to these investments.
Risk exposure
Information about the Group’s exposure to credit risk, foreign exchange risk and price risk is provided in Note 35.
74
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 14: Controlled Entities
The consolidated financial statements incorporate the assets, liabilities and results of the following subsidiaries in accordance
with accounting policy described in Note 1(a).
Controlled Entities Consolidated
Country of
Incorporation
Percentage Owned
(%)
Subsidiaries of Range Resources Limited:
Westblade Pty Ltd (i)
Donnybrook Gold Pty Ltd (i)
Range Australia Resources (US) Ltd (ii)
Range Resources (Barbados) Limited
SOCA Petroleum Limited
Range Resources Drilling Services Limited
West Indies Exploration Company Limited
Range Resources Trinidad Limited
Los Bajos Oil Limited (iii)
Range Resources (Barbados) GY Limited
Range Resources St. Mary’s Limited
Range Resources GY Shallow Limited
Range Resources GY Deep Limited
Range Resources (Cayman) Limited
Range Resources Upstream Services Limited
30 June
2015
30 June
2014
Australia
Australia
USA
Barbados
Barbados
Trinidad
Trinidad
Trinidad
Trinidad
Barbados
Trinidad
Trinidad
Trinidad
Cayman Islands
United Kingdom
-
-
-
100
100
-
100
100
-
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
-
100
100
100
100
(i)
(ii)
(iii)
Dissolved in year
Disposed of in year as part of Texas sale
Amalgamated in year with Range Resources Trinidad Limited.
Note 15: Goodwill
Goodwill is measured as described in note 1(v). Goodwill on acquisition of subsidiaries is included in intangible assets.
Goodwill is not amortised but it is tested for impairment annually or more frequently if events or changes in circumstances
indicate that it might be impaired, and is carried at cost less accumulated impairment losses.
The Group reported goodwill of US$46,198,974, which was derived from the acquisition of SOCA Petroleum Limited through
the parent’s subsidiary Range Resources (Barbados) Ltd.
At 1 July 2014
Cost
Accumulated amortisation and impairment
Net book amount
Year ended 30 June 2015
Opening net book amount
Additions-acquisition
Amortisation charge
Closing net book amount
(a) Impairment tests for goodwill
Goodwill
2014
US$
2015
US$
46,198,974
-
46,198,974
46,198,974
-
46,198,974
46,198,974
-
-
46,198,974
46,198,974
-
-
46,198,974
During the year ending 30 June 2015, the Group determined that there is no impairment of any of its cash-generating units or
group of cash-generating units containing goodwill or intangible assets with indefinite useful lives.
75
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 15: Goodwill (continued)
Goodwill has been allocated for impairment testing purposes to a single cash-generating unit (CGU), identified according to
operating segments, being Trinidad.
Estimates of the recoverable amount is based on an an asset’s fair value less costs to sell (level 3 fair value hierarchy) using a
discounted cash flow method and is most sensitive to the following key assumptions:
-
-
-
-
P1 and P2 Recoverable reserves
Commodity price of between US$52 and US$82 per barrel dependent on the year.
Operating costs at 7-14% of revenue, depending on oil price at that time.
Post-tax discount rate of 10%
Economical recoverable reserves represent management’s expectations at the time of completing the impairment testing and
based on the reserves statements and exploration and evaluation work undertaken by appropriately qualified persons. A
summary of the Company’s Trinidad reserves and resources are published on the company’s website.
The commodity price for oil was based on forecast oil price data compiled by Capital IQ, as used in the IER released on 31
July 2015. The data compiled by Capital IQ is taken from a number of economic and market analyst forecasts and averaged to
present an estimated forecast price. Estimates are $52/bbl in 2015, $63/bbl in 2016, $70/bbl in 2017, $73/bbl in 2018, $78/bbl
in 2019, $80/bbl in 2020 and $82/bbl from 2021.
Operating cost assumptions were based on management reports from June and July 2015.
(b) Sensitivity to change of assumptions
An individual movement of 20% against any one key assumption would cause the carrying value of the cash generating unit to
materially exceed its recoverable amount. An adverse movement of 20% in reserves and resources, commodity prices,
operating costs or discount rate would lead to an impairment of US$16.4m, US$32.3m, US$4.7m and US$4.7m respectively.
76
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 16: Property, Plant & Equipment
Consolidated
Production
Equipment and
access roads
Gathering
Station and Field
Office
Leasehold
Improvement
US$
US$
US$
Motor Vehicle,
Furniture,
Fixtures &
Fittings
US$
Total
US$
Year ended 30
June 2014
Opening net
book amount
Foreign currency
movement
Additions
Disposals
Depreciation
charge
Closing net book
amount
At 30 June 2014
Cost
Accumulated
depreciation
Net book amount
Year ended 30
June 2015
Opening net
book amount
Foreign currency
movement
Additions
Disposals
Disposal of
subsidiary
Depreciation
charge
Closing net book
amount
At 30 June 2015
Cost
Accumulated
depreciation
Net book amount
10,897,690
159,025
433,409
810,294
12,300,418
4,372
746,400
-
-
-
-
546
-
-
2,603
111,534
(2,708)
7,521
857,934
(2,708)
(1,543,103)
(19,756)
(49,139)
(296,898)
(1,908,896)
10,105,359
139,269
384,816
624,825
11,254,269
20,969,042
424,876
1,061,478
2,032,909
24,488,305
(10,863,683)
10,105,359
(285,607)
139,269
(676,662)
384,816
(1,408,084)
624,825
(13,234,036)
11,254,269
10,105,359
143,202
1,413,411
-
139,269
(29,878)
23,543
384,816
624,825
11,254,269
(116,584)
24,181
2,167
115,163
(3,100)
(1,093)
1,576,298
(3,100)
(10,030,580)
-
-
(245,780)
(10,276,360)
(793,660)
(15,844)
(45,098)
(192,970)
(1,047,572)
837,732
117,090
247,315
300,305
1,502,442
5,206,843
(4,369,111)
837,732
529,326
(412,236)
117,090
556,333
(309,018)
247,315
1,235,929
(935,624)
300,305
7,528,431
(6,025,989)
1,502,442
77
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 17: Exploration and Evaluation Expenditure
Opening net book amount
Additions
Assets written off (note 4c)
Closing net book amount
Consolidated
2015
US$
2014
US$
523,605
145,346
-
9,453,636
683,887
(9,613,918)
668,951
523,605
At 30 June 2015, the US$668,951 (30 June 2014 – US$523,605) capitalised exploration and evaluation expenditure relates to
the interests of the Group in the Guayaguayare and St Mary’s Blocks in Trinidad.
Exploration and evaluation expenditure incurred is accumulated in respect of each identifiable area of interest. These costs
are only carried forward to the extent that they are expected to be recouped through the successful development of the area
or where activities in the area have not yet reached a stage that permits reasonable assessment of the existence of
economically recoverable reserves.
The recoverability of the carrying amount of exploration assets is dependent on the successful development and commercial
exploitation or sale of the respective mining permits.
Capitalised costs amounting to US$145,346 (2014: US$683,887) has been included in the statement of cash flows from
investing activities.
Note 18: Producing Assets
At 30 June
Cost
Accumulated amortisation
Net book value
Opening net book amount
Foreign currency movement
Additions
Amortisation charge
Closing net book amount
Consolidated
2015
US$
2014
US$
122,141,667
(31,791,175)
110,748,605
(28,230,785)
90,350,492
82,517,820
82,517,820
395
11,392,667
(3,560,390)
85,422,826
11,633
3,146,149
(6,062,788)
90,350,492
82,517,820
78
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 19: Investments in Associates
Opening balance
Transfer from other non-current assets (note 20)
Transfer investment in unlisted company Strait Oil & Gas (UK)
Limited to held for sale (note 12)
Consideration for equity interest
Further investments
Loss on impairment
Share of net loss using equity method
Transfer investment in Latin American Resources to held for sale
(note 12)
Consolidated
2015
US$
2014
US$
2,779,476
-
-
37,295,453
2,897,785
(39,281,987)
-
-
(600,118)
-
(2,179,358)
1,293,214
2,644,549
(1,410,138)
(659,400)
-
Closing net book amount
-
2,779,476
During the prior year, the Company committed to a plan to dispose of its equity interest in the unlisted Company Strait Oil &
Gas (UK) Limited. US$39,281,987 was therefore re-classified as asset held for sale (refer to note 12).
During the current year, the Company committed to a plan to dispose of its equity interest in Latin American Resources (LAR).
US$2,179,358 was therefore re-classified as asset held for sale (refer to note 12).
Interests in associates
(a)
The table below sets out material interests in associates at 30 June 2015. Unless otherwise stated, the proportionate
ownership interest is the same as the proportion of voting rights held.
Name of entity
Latin American
Resources
Place of
business/
Country of
incorporation
Guatemala
Ownership
interest held by
the group
2015
%
20 (i)
2014
%
20
Nature of
relationship
Measurement
method
Quoted
fair value
2015
$
Equity method N/A *
2014
$
N/A *
Held for sale asset
(2015)
Associate (2014)
*Private company – no share price available
(i) Classified as held for sale during the year at which point ceased to be accounted for as an associate. Range has not
received audited financial statements from Latin American Resources during the year. Range has therefore written down the
carrying value of the asset to US$1.0m.
79
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 20: Other Non-Current Assets
Non-current receivables (a)
Total non-current assets
(a) Non-current receivables
Opening balance
Transfer to other current receivable
Advances made during the year
Foreign currency movement
Payments received during the year
Impairment
Settled by way of available for sale investment
Closing balance
Consolidated
2015
US$
2014
US$
-
-
1,500,000
1,500,000
1,500,000
-
-
-
(500,000)
-
(1,000,000)
-
8,584,773
(1,214,389)
700,000
(20,867)
-
(6,549,517)
1,500,000
During the year ended 30 June 2013, the Company announced its proposal to undertake a strategic merger with International
Petroleum Limited (NSX: IOP) and during that year the Company provided a loan to IOP of US$8,029,110. The loan accrued
interest at a rate of 8% per annum and was repayable by 30 April 2014. IOP was unable to meet the loan repayment when
due. During the current financial year, the Company reached an agreement with IOP to extend the loan repayment date to 30
November 2014 to allow IOP time to complete the sale of its Russian assets and upon conclusion of the sale, IOP made a
US$500,000 cash repayment, with the remaining outstanding monies converted to ordinary shares in IOP. Range also
received 5 million options to acquire shares in IOP (exercisable at AU$0.06, expiry 24 months from the issue date). Following
completion of the sale of IOP Russian assets and the debt conversion to equity, Range owns approximately 9% of the
enlarged share capital of IOP. This balance has been transferred to available for sale financial assets in the period.
IOP remains suspended from trading on NSX and given the uncertainty over the valuation of the shares once trading resumes,
the investment has been written down to US$346,000 being equivalent to the Company's 9% shareholding interest in IOP's net
cash position at 30 June 2015.
Note 21: Trade and Other Payables
Trade payables
Sundry payables and accrued expenses
Risk exposure
Consolidated
2015
US$
4,991,035
8,663,160
13,654,195
2014
US$
4,233,904
4,471,101
8,705,005
Trade payables are non-interest bearing.
Information about the Group’s exposure to credit risk, foreign exchange risk and price risk is provided in Note 35.
80
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 22: Borrowings at Fair Value
(a) Borrowings at Fair Value
Opening balance
Proceeds from borrowings
Fair value movement
Face value premium
Interest due on outstanding balance
Amount classified as equity
Cash repayment
Conversion to equity
Repayment via equity
Settled through transfer of assets
Settled through issue of options
Foreign currency movement
Closing net book amount
Consolidated
2015
US$
-
5,500,000
-
2,250,000
330,577
-
-
-
(562,500)
-
-
-
7,518,077
2014
US$
11,026,440
16,407,790
13,323,578
-
-
(2,123,709)
(16,119,380)
(17,727,995)
-
(2,470,353)
(3,146,491)
830,120
-
On 30 September 2014, Range announced that it had signed a loan agreement for up to US$15 million in medium-term
financing with Lind Asset Management, LLC, (Lind). The terms of the financing were subsequently amended, as announced
on 17 October 2014.
The Loan was signed for a maximum term of 24 months and was to be available in 2 tranches. The first tranche (Tranche 1)
totalling US$10 million, of which US$5 million was funded at closing with the remainder to be drawn down on a monthly basis,
with the second tranche (Tranche 2) totalling US$5 million. The total amount repayable under the facility was to be US$18.375
million (US$12.25 million for Tranche 1 and US$6.125 million for Tranche 2).
Each tranche was repayable over an 18-month period from the date of drawdown. Each repayment could be made on a
monthly basis, at Range’s option, either through cash or shares (Repayment Shares) (or a mixture of both). Following the first
6 monthly repayments, if the Company elected to repay in cash, the repayment amount carried a premium of 2.5% of that
monthly repayment amount. Repayment shares were to be priced at the lower of 92.5% of the average of three daily volume
weighted average prices (VWAP), to be chosen by Lind, during the 20 trading days prior to each issuance of shares and 130%
of the average daily VWAP per share during the 11 trading days prior to 17 October 2014 (for Tranche 1) and the second
closing date (for Tranche 2).
In addition, after a period of 6 months from the initial drawdown, Lind had the option to convert any amounts outstanding under
the agreement into ordinary shares at a premium conversion price equal to 130% of the average of the VWAP during the 11
trading days prior to the amended agreement being signed (equal to either A$0.0243 or 1.203p per share).
As part of the financing package, Lind was also entitled to receive up to 46,500,000 options exercisable for up to 36 months
after the date of issue. The options were to be issued in two tranches; 31,000,000 upon drawdown of Tranche 1 and
15,500,000 6 months after execution of the amended agreement in respect of Tranche 2. The exercise price for the options
was to be equal to 130% of the average of the VWAP during the 11 trading days prior to the amended agreement being
signed. This exercise price is £0.01203.
As security for the facility, Range issued to Lind 38,000,000 ordinary shares in the Company (Collateral Shares).
Range had the right to elect to repay the facility in full at any time and if that occurred Lind had the right upon repayment to
convert the repayable amount at that time (or a certain portion of that amount) into equity at the premium conversion price
equal to 130% of the average of the VWAP during the 20 trading days prior to the agreement being signed (equal to A$0.0335
or 1.8938p per share).
Range received advances totalling US$5,500,000 (minus certain fees) pursuant to the agreement. Range made a repayment
of US$562,500 (paid by way of the issue of shares to Lind) in November 2014.
81
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 22: Borrowings at Fair Value (cont.)
The amended agreement contained a clause to the effect that a suspension of trading of the Company’s shares on either the
ASX or AIM market for more than 5 trading days in any rolling 12 month period commencing on the execution date would
constitute an event of default (subject to certain exceptions). With the suspension which started on 10 December 2014, the
Company fully utilised these days. On that basis, Lind demanded re-payment of the balance of the loan immediately and in
full, together with a premium of US$2.25 million and interest.
On 16 February 2015 Range received a statutory demand from Lind demanding repayment of approximately US$7.2 million
that Lind alleges is due and payable.
On 9 March 2015, Range filed an application to the Supreme Court of Western Australia to set aside the statutory demand.
On 2 July 2015, the company announced that its application to the Supreme Court of Western Australia to set aside the
statutory demand from Lind Asset Management, LLC had been unsuccessful. The Supreme Court extended the time for
payment of the demand.
On 27 July 2015, Range filed an appeal against the Supreme Court’s decision, and the Western Australian Court of Appeal
extended the deadline for repayment until the later of 31 August 2015 or 7 days from the determination of the appeal.
In advance of the appeal, Range paid $5.0m to Lind on 28 July 2015 without prejudice to its contentions in the appeal.
On 10 September 2015 the appeal was heard and as at the date of this report, no decision has been received from the
Western Australian Court of Appeal.
During the prior year the Group entered into various financing arrangements, as follows:
• Equity swap arrangement with Yorkville Advisors – Range issued 72 million shares for £1.1million at a benchmark
•
price of £0.017 to be settled in 6 equal monthly instalments. Nil outstanding at prior year end.
£4.1 million (US$6.2 million) unsecured convertible note agreements with Hudson Bay, Cranshire, Empery and
Hartz. The term of the loan was for 18 months at coupon rate of 10%, a discount to the face value of 10% and
convertible at a 90% VWAP conversion price. The entire balance was settled through the issue of equity during the
year. Under the terms of these agreements, the lender was granted options equal to 50% of the number of shares
issued on each conversion date. These options have an exercise price equal to the conversion price and an expiry
term of 3 years. Nil outstanding at prior year end.
• Platinum Partners provided 2 loans for £2.2 million and US$3.3 million respectively each for a 6 month term. In
consideration for providing the loans the Company issued 13,636,364 options exercisable at £0.011 on or before 31
January 2017, 100million collateral shares in the Company and additionally provided security over 100million shares
held by the Company in Citation Resources Limited (ASX: CTR). The loan was fully repaid during the year and as
part of the repayment arrangements the Company agreed that the lender was not required to return the collateral
shares or the CTR security, which therefore allowed a reduced cash payment of the outstanding amount of the loan.
Nil outstanding at prior year end.
• US$600,000 3-month loan from a US based institutional investor which was convertible at the lenders option at 85%
VWAP conversion price. Nil outstanding at prior year end.
• Unsecured loan of US$2.2 million from a syndicate of Australian investors which was convertible upon the mutual
agreement of the Company and lenders at a 85% VWAP conversion price. In consideration for providing the loans
the Company issued 23,779,254 options to the syndicate. Nil outstanding at prior year end.
• US$1 million, 12 month loan from a Cayman Islands based company which was convertible at the lenders option at
the lower of 1.35p/share or 90% VWAP conversion price. In consideration for providing the loans the Company
issued 7,500,000 options to the lender. Nil outstanding at prior year end.
In the year ended 30 June 2013, the Group issued US$10,400,000 in secured notes to Crede Capital Group. The outstanding
borrowing was fully settled in October 2013 and the remaining obligation to issue 7,500,000 options was satisfied during the
year and the security has been released.
82
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 22: Borrowings at Fair Value (cont.)
Also in the year ended 30 June 2013, the Group entered in a US$15 million Loan Agreement backed by a Standby Equity
Distribution Agreement (“SEDA”) with YA Global Master SPV Ltd, an investment fund managed by Yorkville Advisors. US$6.9
million was drawn during the year ended 30 June 2014 with nil outstanding at prior year end.
(b) Option Liability
Option liability at fair value through profit or loss
Consolidated
2015
US$
2014
US$
808,083
808,083
2,189,913
2,189,913
During 2015, 49,051,468 options with a face value of US$1,426,883 were exercised prior to year-end and 31m options with a
fair value of US$172,926 were issued.
During the prior year 240,694,827 options with a fair value of US$3,004,295 were issued as a result of conversion of notes
under the above financing arrangements. 70,833,334 options with a face value of US$814,382 were exercised prior to year-
end.
Note 23: Provision for Rehabilitation
The Group records the present value of the estimated cost of legal and constructive obligations to restore operating locations
in the period in which the obligation arises. The nature of restoration activities includes removal of facilities, abandonment of
wells and restoration of affected areas.
Provision for rehabilitation
Movement in the provision for rehabilitation during the financial year are set out below:
Carrying amount at the start of the year
Additional provision recognised
Carrying amount at the end of the year
Consolidated
2015
US$
2014
US$
734,858
696,224
696,224
38,634
734,858
654,873
41,351
696,224
83
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 24: Deferred Tax Liability
Movements
Year ended 30 June 2014
Opening balance
Foreign currency movement
Charged/(credited)
-
to profit or loss
Closing net book amount
Year ended 30 June 2015
Opening balance
Foreign currency movement
Disposal of subsidiary
Charged/(credited)
-
to profit or loss
Closing net book amount
Fair Value Uplift
on Business
Combination
Accelerated
Depreciation
US$
US$
38,081,168
1,041
(3,071,637)
35,010,572
35,010,572
(1,041)
(723,359)
(1,966,411)
32,319,761
6,914,465
-
2,450,996
9,365,461
9,365,461
(32,147)
(1,189,198)
(2,895,322)
11,039,438
Total
US$
44,995,633
1,041
(620,641)
44,376,033
44,376,033
(33,188)
(1,912,557)
928,911
43,359,199
As a result of business combination, at the date of acquisition a deferred tax liability has been recognised in relation to the
difference between the carrying amount of the deferred exploration and development costs for accounting purposes and the
cost base of the asset for tax purposes in accordance with the requirements of Australian Accounting Standard AASB 112
Income Taxes. The Group does not have a tax payable in relation to the deferred tax liability at 30 June 2015 and it is
anticipated that the deferred taxation liability will be reduced in the future as the deferred exploration and development costs
are amortised in future periods.
Note 25: Other Non-Current Liabilities
Employee service benefits
Risk exposure
Consolidated
2015
US$
2014
US$
521,257
521,257
584,746
584,746
Information about the Group’s exposure to credit risk, foreign exchange risk and price risk is provided in Note 35.
84
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 26: Contributed equity
5,767,169,188 (2014: 4,521,201,870) fully paid ordinary shares
Nil (2014: 386,188,780 l) unissued fully paid ordinary shares
Nil partly paid shares (2014: 4,925,000)
Share issue costs
Consolidated
2015
US$
2014
US$
382,535,744
-
-
(19,330,467)
364,567,692
6,000,000
1,362,344
(19,330,467)
363,205,277
352,599,569
Consolidated
2015
No.
2015
US$
2014
No.
2014
US$
(a) Fully Paid Ordinary Shares
At the beginning of reporting period
Shares issued during year
4,521,201,870
1,245,967,318
364,567,692
17,968,052
2,898,084,648
1,623,117,222
331,447,756
33,119,936
Total contributed equity
5,767,169,188
382,535,744
4,521,201,870
364,567,692
Ordinary shares entitle the holder to participate in dividends and the proceeds on winding up of the Company in proportion to
the number of and amounts paid on the shares held.
On a show of hands every holder of ordinary shares present at a meeting of the Company, in person or by proxy, is entitled to
one vote, and upon a poll each share is entitled to one vote.
(b) Unissued Fully Paid Ordinary Shares
Opening balance (i)
Issued in year
Shares to be issued subsequent to reporting date (ii)
Total contributed equity
2015
No.
386,188,780
(356,188,780)
-
2014
No.
30,000,000
356,188,780
30,000,000
386,188,780
(i)
(ii)
Under the terms of an agreement between shareholders in Strait, the Company was required to issue
30,000,000 shares to other investors in Strait upon the completion of the next well in the Georgia drilling
programme or upon disposal of Range’s shareholding in Strait.
During the prior year, the company entered into a US$12 million financing facility with a Hong Kong based
private institutional investor, Abraham Ltd. Under the terms of the subscription agreement, Abraham was to
subscribe for shares in the Company in two US$6 million tranches, with the first tranche issued during the year,
whilst the second tranche was to be issued following shareholder approval. Shareholder approval for the issue
of shares for the US$6 million second tranche was sought and obtained at the General Meeting of the Company
on 11th July 2014.
85
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 26: Contributed equity (continued)
(c)
Partly Paid Ordinary Shares
Total partly paid shares -AU$0.30
Total contributed equity
All partly paid shares were cancelled during the year.
(d)
Movements in fully paid ordinary share capital
2015
Details
1 July 2014 Opening balance
Transfer from unissued
Shares issued as loan repayment
Shares issued upon option conversion
Shares issued as Collateral Shares (i)
Shares issued to employees
Number of
shares
4,521,201,870
356,188,780
58,440,891
49,051,468
38,000,000
19,987,481
Shares issued in lieu of corporate advisory/ capital
raising and loan commencement fees
74,298,698
Issued to Beijing Sibo Investment Management LP
30 June 2015 Closing Balance
650,000,000
5,767,169,188
Consolidated
2015
No.
-
-
2014
No.
4,925,000
4,925,000
Issue Price
US$
US$
0.017
0.010
0.010-
0.024
0.008
0.013-
0.040
0.009-
0.037
0.012
364,567,692
6,000,000
562,500
923,880
300,979
580,458
1,633,315
7,966,920
382,535,744
1 July 2013
Opening balance
Issue of shares through conversion of notes (refer
note 22)
Placement
Issue of shares to YA Global through equity swap
(refer note 22)
Equity tranche under YA Global agreement
YA advance
Equity tranche under convertible notes
Issue of shares to Abraham Ltd for US$12m
financing as per subscription agreement
Issue of shares through exercise of options
Shares issued in lieu of corporate advisory fees
(refer note 32)
30 June 2014 Balance
(e) Options
At the beginning of reporting period
Options issued during year
Options expired
Options exercised during year
2,898,084,648
331,447,756
907,296,105
53,125,000
72,000,000
8,119,059
31,000,954
81,460,298
356,188,780
70,833,334
43,093,692
4,521,201,870
0.020
0.037
0.025
0.027
0.036
0.026
0.017
0.009
0.036
17,727,995
1,963,500
1,794,238
219,012
1,107,013
2,123,709
6,000,000
652,778
1,531,691
364,567,692
Consolidated
2015
No.
453,203,084
394,701,840
(9,855,166)
(49,051,469)
2014
No.
266,612,503
257,423,915
-
(70,833,334)
86
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Total options
788,998,289
453,203,084
Note 26: Contributed equity (continued)
At the date of this report, the unissued ordinary shares of Range Resources Limited under option are as follows:
Date of Expiry
31 January 2016
30 April 2016
31 January 2017
19 October 2015
30 November 2015
31 January 2016
10 February 2016
30 April 2016
11 July 2016
25 July 2016
29 July 2016
31 August 2016
31 August 2016
30 September 2016
30 September 2016
31 October 2016
31 October 2016
31 October 2016
31 October 2016
30 November 2016
30 November 2016
11 December 2016
31 December 2016
31 December 2016
31 January 2017
9 September 2017
14 July 2018
14 July 2018
31 January 2018
15 October 2017
30 March 2020
Exercise Price
$0.05
£0.17
£0.075
£0.0615
£0.05075
A$0.10
A$0.06
£0.04
£0.037
£0.021
£0.021
£0.021
£0.020
£0.019
£0.018
£0.018
£0.017
£0.016
£0.015
£0.015
£0.013
$0.0321
£0.012
£0.011
£0.011
£0.03
£0.01
£0.02
$0.05
£0.01203
£0.01
Number Under Option
80,508,341
7,058,824
5,180,000
15,708,801
32,275,862
5,000,000
5,000,000
146,533,850
5,000,000
476,190
952,381
6,714,284
9,000,000
3,947,369
8,666,670
694,445
2,205,885
1,250,000
17,333,336
3,000,001
5,153,846
2,000,000
2,000,000
5,000,000
23,636,364
7,500,000
161,472,247
118,729,593
1,000,000
31,000,000
75,000,000
788,998,289
listed
unlisted
unlisted
unlisted
unlisted
unlisted
unlisted
unlisted
unlisted
unlisted
unlisted
unlisted
unlisted
unlisted
unlisted
unlisted
unlisted
unlisted
unlisted
unlisted
unlisted
unlisted
unlisted
unlisted
unlisted
unlisted
unlisted
unlisted
unlisted
unlisted
unlisted
The holders of these options do not have any rights under the options to participate in any share issues of the company.
During the year ended 30 June 2015, 49,051,468 ordinary shares of Range Resources Limited were issued on the exercise of
options (2014: 70,833,334).
87
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 27: Reserves
(a)
Share-based payment reserve
Balance 1 July
Options issued to consultants and employees (refer note 32)
Expired options reclassified to retained earnings
Balance 30 June
Consolidated
2015
US$
2014
US$
14,226,861
2,157,038
(2,152,321)
14,231,578
14,085,042
141,819
-
14,226,861
The share based payment reserve records items recognised as expenses on the fair valuation of shares and options issued as
remuneration to employees, directors and consultants.
(b)
Option premium reserve
Balance 1 July
Fair value movement of exercised options that were originally classified as a derivative
liability
Balance 30 June
10,630,513
9,815,752
1,426,850
12,057,363
814,761
10,630,513
The option premium reserve is used to recognise the grant date fair value of options.
(c)
Foreign currency translation reserve
Balance 1 July
Currency translation differences arising during the year
Balance 30 June
3,004,632
455,307
3,459,939
3,415,742
(411,110)
3,004,632
The foreign currency translation reserve is used to record exchange differences arising from the translation balances of foreign
subsidiaries.
(d)
Available for sale investment revaluation reserve
Balance 1 July
Reclassification to profit or loss
Decrease in value of investments
Balance 30 June
-
-
-
-
(325,263)
855,146
(529,883)
-
Total Reserves
29,748,880
27,862,006
88
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 28: Commitments
Expenditure commitments
Not later than 1 year
Consolidated
2015
US$
2014
US$
211,000
211,000
137,500
137,500
Note 29: Contingent Liabilities and Contingent Assets
Mark Patterson
Range has received a demand for arbitration of claims in the amount of approximately US$5.8 million from Mark Patterson
who was engaged by Range as a consultant over a period from 2010 - 2014. Mr. Patterson is claiming he terminated a
purported consultant contract, dated 29 August 2013, with good reason, as defined in the contract, due to a reduction in duties,
and in that circumstance he claims to be entitled to full payment for the remainder of the term of the contract plus various other
payments. Range has engaged legal advisers to assist with this claim and will strongly defend our position. The claim will be
heard through an arbitration process in Texas. It is currently expected that the arbitration hearing will occur in late
2015. Given the process is still at an early stage, Range is unable to quantify any likely financial impact of a successful claim
against the Company however, it will not have a material impact.
Crown Capital Partners
Range is involved as a defendant in a court action in Alberta, Canada related to an alleged breach in early 2013 of an
exclusivity undertaking in a commitment letter from a potential financier dated 6 November 2012. The claim is for
approximately C$500,000. Range strongly refutes the allegations and intends to vigorously defend our position. A Statement
of Defence has been filed and Range is currently in the discovery phase of litigation. There is no date as yet for a court
hearing and the Company is not in a position therefore to determine the likely financial impact of any successful claim. Range
however, believes that any outcome against the Company will not have a material impact.
Lancdon LLC & Benedict Silverman
Los Bajos Oil Limited is a defendant in a court action in federal court in the state of Connecticut, USA which dates back to the
period prior to Los Bajos being acquired by Range in 2011. The claim relates to an alleged breach of contract with respect to
payments due by Los Bajos to Lancdon LLC under a settlement agreement dated May 2011. Range has an indemnity from
the sellers of Los Bajos in respect of any successful claim against the Company.
The Directors are not aware of any
further contingent
liabilities or contingent assets as at 30 June 2015.
89
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 30: Segment Reporting
Management have determined that the operating segments are broadly consistent with prior periods, with management allocating resources to segments on a geographical basis. During the
financial period, the Group operated in six operational segments being Somalia, Georgia, Texas, Colombia, Guatemala and Trinidad. The operating segments of Somalia and Colombia have been
aggregated as their operations are of a similar nature and not material to the Group.
(a) Segment information provided to the strategic steering committee
Year ended 30 June 2015
Continuing Operations
Discontinued operations
Trinidad
All Other
Segments
Total
Discontinued
Operations -
Georgia
Discontinued
Operations -
Texas
Discontinued
Operations -
Guatemala
Total
discontinued
operations
Consolidated
US$
US$
US$
US$
US$
US$
US$
US$
Segment revenue
Revenue from continuing operations
Revenue from discontinued operations
Other income
Total revenue
Segment result
Segment expenses
Profit/ (loss) before income tax
Income tax
Profit/ (loss) after income tax
Segment assets
Segment assets
Total assets
Segment liabilities
Segment liabilities
Total liabilities
13,152,954
-
-
13,152,954
-
-
428,588
428,588
13,152,954
-
428,588
13,581,542
-
-
-
-
-
238,194
-
238,194
-
-
-
-
-
238,194
-
238,194
13,152,954
238,194
428,588
13,819,736
(23,162,985)
(10,010,031)
(1,467,806)
(11,477,837)
(11,532,647)
(11,104,059)
(11,104,059)
(34,695,632)
(21,114,090)
(1,467,806)
(22,581,896)
(5,474,255)
(5,474,255)
-
(5,474,256)
(681,621)
(443,427)
-
(443,427)
(1,779,476)
(1,779,476)
-
(1,779,476)
(7,935,352)
(7,697,158)
-
(7,697,159)
(42,630,983)
(28,811,248)
(1,467,806)
(30,279,054)
144,457,523
144,457,523
11,458,496
11,458,496
155,916,019
155,916,019
5,000,000
5,000,000
-
-
1,000,000
1,000,000
6,000,000
6,000,000
161,916,019
161,916,019
49,846,696
49,846,696
17,045,866
17,045,866
66,892,562
66,892,562
-
-
-
-
-
-
-
-
66,892,562
66,892,562
90
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 30: Segment Reporting (continued)
Year ended 30 June 2014
Continuing Operations
Discontinued operations
Trinidad
All Other
Segments
Total
Discontinued
Operations -
Georgia
Discontinued
Operations -
Texas
Total
discontinued
operations
Consolidated
US$
US$
US$
US$
US$
US$
US$
21,185,745
-
3,218
21,188,963
-
-
1,221,108
1,221,108
21,185,745
-
1,224,326
22,410,071
-
-
-
-
-
553,965
-
553,965
-
553,965
-
553,965
21,185,745
553,965
1,224,326
22,964,036
(27,817,491)
(6,628,528)
(906,620)
(7,535,148)
(59,373,442)
(58,152,334)
-
(58,152,334)
(87,190,933)
(64,780,862)
(906,620)
(65,687,482)
(29,281,987)
(29,281,987)
(29,281,987)
(8,670,784)
(8,116,819)
544,298
(7,572,521)
(37,952,771)
(37,398,806)
544,298
(36,854,508)
(125,143,704)
(102,179,668)
(362,322)
(102,541,990)
147,238,949
147,238,949
5,058,337
5,058,337
152,297,286
152,297,286
10,000,000
10,000,000
1,080,777
1,080,777
11,080,777
11,080,777
166,157,539
166,157,539
51,383,185
51,383,185
5,479,091
5,479,091
56,862,276
56,862,276
-
-
-
-
-
-
56,862,276
56,862,276
Segment revenue
Revenue from continuing operations
Revenue from discontinued operations
Other income
Total revenue
Segment result
Segment expenses
Profit/ (loss) before income tax
Income tax
Profit/ (loss) after income tax
Segment assets
Segment assets
Total assets
Segment liabilities
Segment liabilities
Total liabilities
91
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 30: Segment Reporting (continued)
(b) Other segment information
Segment other revenue – all other segments
Other income
Segment result – all other segments
Directors fees
Consultancy fees
Marketing and Public relations
Share-based payments
Finance costs
Asset write offs
Administration and other expenses
Exploration expenses
Share of loss of associate
Accounting Policies
Consolidated
2015
US$
2014
US$
428,588
1,221,108
428,588
1,221,108
912,290
359,830
200,134
2,737,493
4,347,575
38,929
2,544,177
392,219
-
1,115,524
3,421,400
461,902
1,673,558
21,797,779
9,138,960
4,014,652
15,577,838
2,171,829
11,532,647
59,373,442
AASB 8 requires operating segments to be identified on the basis of internal reports about components of the Group that are
regularly reviewed by the chief operating decision maker in order to allocate resources to the segment and to assess its
performance. The chief operating decision maker is the managing director and through this role the Board of Directors.
Following the adoption of AASB 8, the identification of the Group’s reporting segments remain consistent with prior periods, with
management allocating resources to segments on a geographical basis.
Information regarding these segments is presented above. The accounting policies of the reportable segments are the same as
those of the Group. Segment information is prepared in conformity with the accounting policies of the entity as disclosed in Note
1.
Segment revenues and expenses are those directly attributable to the segments and include any joint revenue and expenses
where a reasonable basis of allocation exists. Segment assets include all assets used by a segment and consist principally of
cash, receivables, plant and equipment, exploration expenditure capitalised and development assets net of accumulated
depreciation and amortisation. While most such assets can be directly attributed to individual segments, the carrying amount of
certain assets used jointly by two or more segments is allocated to the segments on a reasonable basis. Segment disclosures do
not include deferred income taxes.
Revenue from discontinued operations from Texas of US$238,194 (2014: US$553,965) is derived from several customers who
each account for greater than 10% of this amount. Revenue from Trinidad of US$13,152,954 (2014: US$21,185,745) is derived
from the subsidiary’s sole customer, which is Petrotrin.
Intersegment Transfers
Segment revenues, expenses and results do not include any transfers between segments.
92
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 31: Cash Flow Information
Reconciliation of cash flow from operations with loss after income tax
Loss after income tax
Non-cash flows in profit
Depreciation
Share based payment- consultants and employees
Finance costs (non-cash)
Interest on non-current receivable paid in shares
Impairment expense
Loss on sale of subsidiary
Loss on sale of PPE
Foreign exchange (gain)/loss
Impairments recognised on held for sale assets
Share of net loss of associate
Net loss on sale of available for sale financial assets
Other non-cash items*
Decrease/(increase) in other operating assets
Decrease/(increase) in other current assets
Decrease/(increase) in trade and other receivables
Decrease/(increase) in deferred tax asset
Increase/(decrease) in trade and other payables
Increase/(decrease) in accrued interest
Increase/(decrease) in income tax payable
Increase/(decrease) in deferred tax liabilities
Increase/(decrease) in provisions
Consolidated
2015
US$
2014
US$
(30,279,054)
(102,541,990)
4,766,581
2,737,443
2,107,281
-
654,000
1,593,766
3,100
(124,789)
6,779,476
-
496,958
-
375,820
(608,228)
175,634
162,554
2,830,577
(13,442)
1,097,078
289,981
7,972,169
1,673,558
16,818,148
(1,207,598)
21,778,525
-
-
(840,637)
37,244,836
659,400
855,146
3,090,272
-
8,958,238
(245,405)
1,534,827
-
(1,495,695)
(619,600)
144,025
Net cash inflow/(outflow) from operations
444,738
(6,221,781)
*Net of effects of subsidiary disposal
Non-cash investing and financing activities
Repayment of borrowings:
Through issue of shares
Through the issue of options
Acquisition of available for sale financial assets
Non-cash consideration for investment in associate
Share issued as share based payments or finance costs
Consolidated
2015
US$
2014
US$
562,500
-
-
-
4,844,724
17,727,598
3,146,491
1,207,598
1,293,214
-
Note 32: Share-Based Payments
The following share-based payment arrangements occurred during the financial year ended at 30 June 2015.
Quantity
19,987,481
Security
Fully paid ordinary shares
US$ Value Purpose
580,406 Shares issued to employees and consultants
42,742,654
Unlisted options
1,176,524 Options issued in lieu of consulting fee
75,000,000
Unlisted options
85,464 Options issued to Directors in period
7,500,000
Unlisted options
895,049 Options issued in lieu of consulting fees
93
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 32: Share-Based Payments (continued)
The following inputs were used to calculate the value of the options issued to Directors in the period:
Volatility: 100%
Risk free rate: 1.92%
USD/GBP exchange rate: 0.7752
Grant date: 27 March 2015
Exercise price: £0.01
Share price on grant date £0.054
The following share-based payment arrangements occurred during the financial year ended at 30 June 2014.
Quantity
43,093,692
Security
Fully paid ordinary shares
US$ Value Purpose
1,531,691
Issued in lieu of corporate advisory fees
16,729,087
Listed options
141,869
Issued in lieu of corporate advisory fee
Listed options issued as share based payments during the year ended 30 June 2014 were valued based upon the market price
at grant date. There were no unlisted options issued in the 30 June 2014 year.
The fair value at grant date of unlisted options is independently determined using a Black Scholes option pricing model that
takes into account the exercise price, the term of the option, the impact of dilution, the share price at grant date and expected
price volatility of the underlying share, the expected dividend yield and the risk free interest rate for the term of the option.
Employee option plan
During the year the following options were issued to Directors and employees:
Name
Mr Yan Liu
Mr David Chen
Mr Zhiwei Gu
Ms Juan Wang
Number of options
30,000,000
30,000,000
7,500,000
7,500,000
The vesting conditions of these options are as follows:
(a) 25% will become exercisable on the date that is one year from the issue date
(b) 25% will become exercisable upon the Company reaching production of 1,500 barrels of oil per day for a continuous 15 day
period in Trinidad
(c) 25% will become exercisable upon the Company reaching production of 2,500 barrels of oil per day for a continuous 15 day
period in Trinidad
(d) 25% will become exercisable upon the Company reaching production of 4,000 barrels of oil per day for a continuous 15 day
period in Trinidad
In addition to the above, vesting depends on continued employment.
In 2014, no options were issued to Directors or employees.
Expenses recognised in the profit & loss
During the year, share-based payments recognised in profit and loss amounts to US$2,157,037 (2014: US$1,673,558)
94
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 32: Share-Based Payments (continued)
As at 1 July
Granted during year
Exercised
Forfeited
As at 30 June
2015
Number
Average exercise
price US$
453,203,083 0.060
394,701,840 0.019
(49,051,468) 0.017
(9,855,166)
788,998,289 0.023
2014
Number
266,612,503
257,423,914
(70,833,334)
-
453,203,083
Average exercise
price US$
0.078
0.023
0.009
0.060
Valued and exercisable at 30 June
713,998,289 0.047
453,203,083
0.060
Weighted average remaining contractual life
options outstanding at end of period
673 days
700 days
Note 33: Related Party Transactions
(a)
(b)
Parent entity
The ultimate Parent Entity and ultimate Australian Parent Entity within the Group is Range Resources Limited.
Subsidiaries
Interests in subsidiaries are set out in Note 14.
(c)
Transactions with Key Management Personnel
The following transactions occurred during the year with Key Management Personnel or their related parties:
Consulting fees paid or payable to Soncer Limited, a company owned by Mr Graham Lyon, for
the provision of corporate advisory and capital raising services (i)
Consulting fees paid or payable to DNR Consulting, a company owned by Mr David Rieke, for the
provision of corporate advisory and services (ii)
Balances at year end to related parties:
Sir Sam Jonah (i)
Marcus Edwards-Jones (i)
Soncer Limited (i)
Anthony Eastman (iii)
OKAP Ventures Pty Ltd payable (iii)
Doull Holdings Pty Ltd payable (in respect of Peter Landau Director fees) (iii)
2015
US$
2014
US$
12,794
67,321
13,486
-
191,440
33,566
18,442
169,280
64,579
165,403
219,661
33,419
-
221,063
79,585
181,612
(i)
(ii)
(iii)
These were related parties throughout the financial year until 28 November 2014.
David Rieke was a related party throughout the financial year until 11 December 2014.
Related party until 13 June 2014
95
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 33: Related Party Transactions (continued)
(d)
Key management personnel compensation
Short–term employee benefits
Post-employment benefits
Termination benefits
Share based payments
Total
(e)
Transactions with associates
Details of transactions with associates are set out in Note 19.
Note 34: Parent Entity Information
Consolidated
2015
US$
778,338
28,152
150,253
85,464
1,042,207
2014
US$
1,147,859
48,299
-
-
1,196,158
The following details information related to the Parent Entity Range Resources Limited, at 30 June 2015. The
information presented here has been prepared in accordance using consistent accounting policies as presented in
Note 1.
Current assets
Non-current assets
Total assets
Current liabilities
Total liabilities
Contributed equity
Accumulated losses
Reserves
Total equity
Loss for the year from continuing operations
Loss for the year from discontinued operations
Total loss for the year
Other comprehensive loss for the year
Total comprehensive loss for the year
2015
US$
2014
US$
15,290,123
97,208,375
112,498,498
3,740,814
119,618,504
123,359,318
15,333,201
15,333,201
5,361,769
5,361,769
363,205,245
(295,165,636)
29,125,688
97,165,297
352,599,569
(262,296,104)
27,694,084
117,997,549
(29,028,556)
(7,355,641)
(36,384,197)
(57,548,321)
(37,556,087)
(95,104,408)
-
(36,384,197)
325,263
(94,779,145)
The contingent liabilities of the parent are the same as those of the Group as disclosed in Note 29.
The contractual commitments of the parent are the same as those of the Group as disclosed in Note 28.
96
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 35: Financial Risk Management
The Group has exposure to the following risks from their use of financial instruments:
• Credit risk
•
Liquidity risk
• Market risk
This note presents information about the Group’s exposure to each of the above risks, their objectives, policies and processes
for measuring and managing risk, and the management of capital. Further quantitative disclosures are included throughout
these financial statements.
The Board of Directors has overall responsibility for the establishment and oversight of the risk management framework.
Risk management policies are established to identify and analyse the risks faced by the Group, to set appropriate risk limits
and controls, and to monitor risks and adherence to limits. Risk management policies and systems are reviewed to reflect
changes in market conditions and the Group’s activities. The Group, through training and management standards and
procedures, aims to develop a disciplined and constructive control environment in which all consultants and agents understand
their roles and obligations.
Credit risk
Credit risk is the risk of financial loss to the Group if counterparty to a financial instrument fails to meet its contractual
obligations, and arises principally from the Group’s investments, receivables and cash held at financial institutions.
Credit risk is managed on a group basis. Individual risk limits are set based on internal or external ratings in accordance with
limits set by the board. There are no significant concentrations of credit risk, whether through exposure to individual
customers, specific industry sectors and/or regions.
The credit quality of financial assets that are neither past due or impaired can be assessed by reference to external credit
ratings (if available) or to historical information about counterparty default rates.
Cash at bank and short-term bank deposits (S&P ratings)
AA-
A-
BBB+
BBB
Exposure to credit risk
Consolidated
2015
US$
9,868,592
-
661,512
-
10,530,104
2014
US$
1,603,785
1,340,063
-
33,562
2,977,410
The carrying amount of the Group’s financial assets represents the maximum credit exposure. The Group’s maximum
exposure to credit risk at the reporting date was:
Trade and other receivables (i)
Non-current receivable (i)
Cash and cash equivalents
(i)
Counterparties without an external credit rating
Consolidated
2015
US$
5,148,978
-
10,530,104
15,679,082
2014
US$
5,338,769
1,500,000
2,977,410
9,816,179
97
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 35: Financial Risk Management (continued)
Loans and receivables
The Group’s exposure to credit risk is influenced mainly by the individual characteristics of each debtor. No collateral was held
in relation to these receivables.
Impairment losses
During the year, an impairment of US$17,937 on trade and other receivables were recognised. An impairment loss of
US$654,000 was recognised in relation to the IOP asset in the year. During the prior year, given uncertainty over the
counterparty’s ability to receive repayment a provision for impairment of US$2,489,443 was recognised in relation to
miscellaneous other receivables totalling US$3,179,394.
Liquidity risk
Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due. The Group’s approach to
managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due,
under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Group’s reputation.
The Group uses activity-based costing to cost its activities, which assists in monitoring cash flow requirements and optimising
its cash return on investments. Typically, the Group ensures that it has sufficient cash on demand to meet expected
operational expenses for a period of 6 months; this excludes the potential impact of extreme circumstances that cannot
reasonably be predicted, such as natural disasters.
The following are contractual maturities of financial liabilities, including estimated interest payments and excluding the impact
of netting agreements:
Group
2015
Financial liabilities at
amortised cost
Trade and other payables
Borrowings
Group
2014
Financial liabilities at amortised
cost
Trade and other payables
Borrowings
Market risk
Carrying
amount
Contractual
cash flows
6 months or
less
6 – 12
months
1-2
years
2-5
years
Over 5
years
11,998,340
7,518,077
19,516,417
11,998,340
7,518,077
19,516,417
11,998,340
7,518,077
19,516,417
-
-
-
-
-
-
-
Carrying
amount
Contractual
cash flows
6 months
or less
6 – 12
months
1-2
years
2-5
years
Over 5
years
8,705,005
-
8,705,005
6,515,093
-
6,515,093
6,515,093
-
6,515,093
-
-
-
-
-
-
-
-
-
-
-
Market risk is the risk that changes in market prices, such as interest rates and equity prices will affect the Group’s income or
the value of its holdings of available for sale assets. The objective of market risk management is to manage and control market
risk exposures within acceptable parameters, while optimising the return.
98
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 35: Financial Risk Management (continued)
Equity price risk
The Group is exposed to equity securities price risk. This arises from investments held by the Group and classified on the
statement of financial position as available for sale as well as from the option liability held as a current liability.
A 10% increase in Range’s share price would result in an increase to the option liability of $76,707. A decrease would have
had the equal but opposite effect.
The Group holds equity investments which are publicly traded and included on the NSX.
Range holds an equity investment in International Petroleum Ltd (“IOP”). Any adverse movement in the share price would be
immaterial.
Foreign exchange risk
The Group operates internationally and is exposed to foreign exchange risk arising from various currency exposures, primarily
with respect to the US dollar, AU dollar, TT Dollar and British pound.
Foreign exchange risk arises from future commercial transactions and recognised assets and liabilities denominated in a
currency that is not the entity’s functional currency. The risk is measured using sensitivity analysis and cash flow forecasting.
The Group’s treasury risk management policy is to closely monitor exchange rate fluctuations. To date, the Group has not
sought to hedge its exposure to fluctuations in exchange rates, however this policy will be reviewed on an ongoing basis.
The Group’s exposure to foreign currency risk at the reporting date was as follows: (expressed in USD)
Amount receivable from other entities
Cash
Available for sale investments
Amount payable to other entities
Sensitivity
Consolidated
Consolidated
2015
AUD
2014
AUD
2015
GBP
2014
GBP
-
272,621
-
(1,159,133)
(886,512)
1,647,657
343,923
784,397
(1,042,719)
1,733,257
-
242,304
-
(362,135)
(119,831)
-
83,284
-
-
83,284
Based upon the amounts above, had the Australian dollar strengthened by 10% against the US dollar with all other variables
held constant, the Group post-tax loss for the year on current amounts receivable/payable would have been US$67,885 higher
(2014: US$181,654 lower), mainly as a result of foreign exchange gains/losses on translation of AUD denominated payables
as detailed in the table above. A 10% weakening of the Australian dollar against the above currencies at 30 June would have
had the equal but opposite effect, on the basis that all other variables remain constant.
The Trinidad entities are minimally exposed to foreign exchange risk arising from various currencies, primarily with respect to
the United States Dollar.
99
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 35: Financial Risk Management (continued)
Interest rate risk
The group’s main interest rate risk arises from non-current receivables and borrowings. Non-current receivables and borrowings issued at fixed rates expose the group to fair value interest rate if
the loans are carried at fair value. During 2015 and 2014, the group loan receivables were denominated in Australian Dollars, British Pounds and US Dollars.
Profile
At the reporting date, the interest rate profile of the Group’s financial instruments which exposes the group to cash flow interest rate risks are:
Weighted
Average
Effective Interest
Rate
Floating Interest
Fixed Interest Maturing
Non-interest bearing
Total
Rate
2015
%
0.10%
-
-
-
0.10%
2014
%
2015
US$
2014
US$
2015
US$
2014
US$
2015
US$
2014
US$
2015
US$
2014
US$
2.50%
-
10,530,104
-
-
3.33%
2.31%
-
-
10,530,104
2,977,410
-
-
-
2,977,410
-
-
-
-
-
-
-
-
1,500,000
1,500,000
-
5,148,978
446,000
-
5,594,978
-
5,338,769
10,530,104
5,148,978
2,977,410
5,338,769
876,347
-
6,215,116
446,000
-
16,125,082
876,347
1,500,000
10,692,526
-
35%
35%
-
-
-
-
-
-
-
-
-
-
7,518,077
7,518,077
-
-
-
11,998,340
-
11,998,340
8,705,005
-
8,705,005
11,998,340
7,518,077
19,516,417
8,705,005
-
8,705,005
Financial Assets:
Cash and cash equivalents
Trade and other receivables
Available for sale financial
assets
Non-current receivables
Total Financial Assets
Financial Liabilities:
Trade and other payables
Borrowings
Total Financial Liabilities
100
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 35: Financial Risk Management (continued)
Sensitivity analysis for variable rate instruments
The sensitivity on interest rates for 2015 and 2014 assumes a change of 100 basis points in the interest rates at the reporting
date and would have increased / (decreased) profit and loss by the amounts shown. Both analyses for each year assume that
all other variables, in particular foreign currency rates, remain constant.
Weighted
Average
Interest
Rate
%
2015
2015
+100
bps
US$
-100
bps
US$
Weighted
Average
Interest
Rate
%
2014
2014
+100
bps
US$
-100
bps
US$
0.10%
-
-
-
-
-
2.50%
3.33%
-
-
-
-
Group
Variable rate instruments
Financial assets (cash and cash equivalents)
Financial assets (loan and receivables)
Fair values versus carrying amounts
The fair value of financial assets and liabilities, together with the carrying amounts shown in the statement of financial position,
are as follows:
Group
Available-for-sale financial assets
Trade and other receivables
Non-current receivable
Cash and cash equivalents
Trade and other payables
Borrowings
30 June 2015
US$
Carrying
amount
446,000
5,148,978
-
10,530,104
(11,998,340)
(7,518,077)
(3,391,335)
Fair value
446,000
5,148,978
-
10,530,104
(11,998,340)
(7,518,077)
(3,391,335)
30 June 2014
US$
Carrying
amount
Fair
value
876,347
5,338,769
1,500,000
2,977,410
(8,705,005)
-
1,987,521
876,347
5,338,769
1,500,000
2,977,410
(8,705,005)
-
1,987,521
The basis for determining fair value is disclosed in Note 1(n) and Note 1(o).
Other price risk
The Group is not exposed to any other price risks.
Capital management
The entity’s objectives when managing capital is to safeguard its ability to continue as a going concern, so that it can continue
to provide returns for shareholders and to maintain an optimal capital structure to reduce the cost of capital.
The entity’s overall strategy remains unchanged from 2014.
The capital structure of the group consists of cash and cash equivalents and equity attributable to equity holders of the
Company, comprising issued capital, reserves and accumulated losses as disclosed in Notes 26 and 27 respectively. None of
the entities within the group are subject to externally imposed capital requirements.
101
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 35: Financial Risk Management (continued)
Gearing ratio
The Board reviews the capital structure on an annual basis. As a part of this review the Board considers the cost of capital
and the risks associated with each class of capital
Financial assets
Cash and cash equivalents
Financial liabilities
Trade and other payables
Borrowings
Net assets / (debt)
Equity
Net debt to equity ratio
Categories of financial instruments
Financial assets
Cash and cash equivalents
Trade and other receivables
Non-current receivable
Available-for-sale financial assets
Financial liabilities
Trade and other payables
Borrowings
Option liability
Consolidated
2015
US$
2014
US$
10,530,104
2,977,410
(11,998,340)
(7,518,077)
(8,986,313)
96,507,888
9.31%
(8,705,005)
-
(5,727,595)
109,295,263
5.24%
Consolidated
2015
US$
2014
US$
10,530,104
5,148,978
-
446,000
16,125,082
11,998,340
7,518,077
808,083
20,324,500
2,977,410
5,338,769
1,500,000
876,347
10,692,526
8,705,005
-
2,189,913
10,894,918
The carrying amount reflected above represents the Group’s maximum exposure to credit risk for such loans and receivables.
102
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 36: Fair Value Measurement of Financial Instruments
(a)
Fair value hierarchy
AASB 13 requires disclosure of fair value measurements by level of the following fair value measurement hierarchy:
(a) Quoted prices (unadjusted) in active markets for identical assets or liabilities (level 1),
(b) Inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly or
indirectly (level 2), and
Inputs for the asset or liability that are not based on observable market data (unobservable inputs (level 3).
(c)
The following table presents the Group’s financial assets and financial liabilities measured and recognised at fair value at 30
June 2015 and 30 June 2014 on a recurring basis:
At 30 June 2015
Assets
Available for sale financial assets
Equity securities
Total assets
Liabilities
Option liability at fair value through profit or loss
Borrowings
Total liabilities
At 30 June 2014
Assets
Available for sale financial assets
Equity securities
Total assets
Liabilities
Option liability at fair value through profit or loss
Total liabilities
Level 1
US$
Level 2
US$
Level 3
US$
Total
-
-
446,000
446,000
446,000
446,000
-
-
-
-
-
808,083
7,518,077
8,326,160
-
-
-
-
-
-
-
808,083
7,518,077
8,326,160
Total
876,347
876,347
2,189,913
2,189,913
Level 1
US$
Level 2
US$
Level 3
US$
876,347
876,347
-
-
-
-
2,189,913
2,189,913
The fair value of financial instruments in active markets such as available for sale securities is based on quoted market bids at
the end of the reporting period. The quoted market price used for financial assets held by the Group is the current bid price.
These instruments are included in Level 1.
The Group’s policy is to recognise transfers into and transfers out of fair value hierarchy levels as at the end of the end of the
reporting period. There were no transfers between the levels of the fair value hierarchy during the year ended 30 June 2015.
(b)
Fair values of other financial instruments
The Group has no financial instruments which are not measured at fair value in the consolidated statement of financial
position.
Due to their short term nature, the carrying amounts of the current receivables, current payables, current borrowings, and
current other financial liabilities is assumed to approximate their fair value.
103
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 37: Fair Value Measurement of Non-Financial Instruments
(a)
Non-recurring fair value measurements
Assets classified as held for sale at 30 June 2015 were measured at fair value less costs to sell in accordance with the Group’s
accounting policy.
Fair value less costs to sell has been determined based upon offers received from independent third parties to acquire the
assets. Due to the way the third party offers are structured, the fair values of assets held for sale has been assessed as a
Level 3 measurement as per the fair value hierarchy set out above.
Significant estimates made in determining the fair value of held for sale assets are as follows:
Strait Oil & Gas (UK) Limited
The Group has made the decision to divest Strait in June 2014. as part of the revised strategy to focus on Trinidad and the
Group is in the process of marketing its equity interest in Strait. The Group is optimistic that a buyer will be found for this
asset. In the absence of a fully executed sale agreement at the report date the Group has chosen to write down the value of
its interest in Strait to US$5million which is considered by the Company to be a fair market value for the level of cash
consideration which may be received upon closing of a sale. This valuation is based upon expressions of interest received
and negotiations which have taken place with potential purchasers.
Latin American Resources (LAR)
The Group has also made the decision to divest LAR in June 2015. The Group is optimistic that a buyer will be found for this
asset. In the absence of a fully executed sale agreement at the report date the Group has chosen to write down the value of
its interest in LAR to US$1million which is considered by the Company to be a fair market value for the level of cash
consideration which may be received upon closing of a sale. This valuation is based upon expressions of interest received
and negotiations which have taken place with potential purchasers.
(b)
Fair value hierarchy
AASB 13 requires disclosure of fair value measurements by level of the following fair value measurement hierarchy:
(d) Quoted prices (unadjusted) in active markets for identical assets or liabilities (level 1),
(e) Inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly or
indirectly (level 2), and
Inputs for the asset or liability that are not based on observable market data (unobservable inputs (level 3).
(f)
The Group’s policy is to recognise transfers into and transfers out of fair value hierarchy levels as at the end of the end of the
reporting period. There were no transfers between the levels of the fair value hierarchy during the year ended 30 June 2015.
The following table presents the Group’s non-financial instruments measured and recognised at fair value at 30 June 2015 on
a non-recurring basis:
At 30 June 2015
Assets
Assets classified as held for sale
Strait Oil & Gas (UK) Limited
Latin American Resources
Total assets
Level 1
US$
Level 2
US$
Level 3
US$
Total
-
-
-
-
-
-
5,000,000
2,179,358
7,179,358
5,000,000
2,179,358
7,179,358
104
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 38: Events after the Reporting Date
Loan Financing with Lind
Subsequent to the period end, the Company announced that its application to the Supreme Court of Western Australia to set
aside the statutory demand from Lind Asset Management, LLC had been unsuccessful. The Supreme Court extended the
time for payment of the demand. Subsequently, Range filed an appeal against the Supreme Court’s decision, and the Western
Australian Court of Appeal extended the deadline for repayment until the later of 31 August 2015 or 7 days from the
determination of the appeal. In advance of the appeal, Range paid US$5 million to Lind without prejudice to its contentions in
the appeal. On 10 September 2015 the appeal was heard and as at the date of this report, no decision has been received from
the Western Australian Court of Appeal.
Completion of US$30m funding
Following the Company’s announcement on 1 September 2015, Range received proceeds of US$22.1 million in cash from
Beijing Sibo Investment Management LP (“Sibo”). As per the terms of the subscription agreement, Range issued
1,797,620,912 new ordinary fully paid shares of the Company to Sibo at a subscription price of £0.008 per Share, which
represented a premium of approximately 45% to the share price of the Company on the close of AIM on 2 September 2015.
The Company also issued 194,585,862 unlisted warrants with an exercise price of £0.01 and 172,557,274 unlisted warrants
with an exercise price of £0.02 to Sibo. All warrants have an expiry date of 3 September 2019. Tranche 1 subscription
proceeds of £5.2 million (approximately US$7.9 million) in cash had already been received by the Company, as announced on
5 June 2015. Following completion of Tranche 2, the total funding provided by Sibo is US$30 million. This gave Sibo a total
holding of approximately 32% in the enlarged share capital of the Company.
St Mary’s block
During the period, the Company successfully signed the Exploration & Production licence and negotiated the Joint Operating
Agreement on the new St Mary’s block. The work programme on the block has commenced with the audit of existing field
infrastructure, facilities and wells currently underway. Range has committed to drilling four exploration wells, shooting 160km of
2D seismic and 60km2 of 3D seismic, along with various other technical studies before the end of 2018.
Subsequent to the period end, Range used US$8 million of the Sibo proceeds to provide the Ministry of Energy and Energy
Affairs with the required performance bond in support of the minimum work obligations on the St Mary’s licence. The Company
is seeking alternative sources of finance to replace this bond, which would allow the cash collateral to be released and used for
other purposes.
105
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 39: New Accounting Standards and Interpretations
Australian Accounting Standards/Amendments Released But Not Yet Effective: 30 June 2015 Year End
Certain new accounting Standards and Interpretations have been published that are not mandatory for 30 June 2015 reporting
periods and have not been early adopted by the Group. The Group’s assessment of the impact of these new Standards and
Interpretations is set out below. In all cases the Group intends to apply these standards from the application date as indicated
in the table below.
Reference Title
AASB 9
Financial
Instruments
Standard
application date
1 January 2018
Group
application date
1 July 2018
1 January 2018
1 July 2018
AASB 15
Revenue
from
Contracts
with
Customers
Key Requirements
Impact
AASB 9 addresses the
classification, measurement and
derecognition of financial assets
and financial liabilities and
introduces new rules for hedge
accounting.
In December 2014, the AASB
made further changes to the
classification and measurement
rules and also introduced a new
impairment model. These latest
amendments now complete the
financial instruments standard.
The AASB has issued a new
standard for the recognition of
revenue. This will replace AASB
118 which covers contracts for
goods and services and AASB111
which covers construction
contracts.
The new standard is based on the
principle that revenue is
recognised when control of a good
or service transfers to a customer,
so the notion of control replaces
the existing notion of risks and
rewards.
The standard permits a modified
retrospective approach for the
adoption. Under this approach
entities will recognise any
applicable transitional adjustments
in retained earnings on the date of
the initial application without
restating the comparative period.
Entities will only need to apply the
new rules to contracts that are not
completed as of the date of initial
application.
There will be no
significant
impact on the
Group on the
adoption of this
standard.
Management is
currently
assessing the
impact of the
new rules.
At this stage, the
Group is not able
to estimate the
impact of the
new rules on the
Group’s financial
statements. The
Group will make
more detailed
assessments of
the impact over
the next 12
months.
106
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED
30 JUNE 2015
Note 39: New Accounting Standards and Interpretations (continued)
Standard
application date
1 January 2016
Group
application date
1 July 2016
Reference Title
AASB
2015-2
Amendments
to Australian
Accounting
Standards -
Disclosure
Initiative:
Amendments
to AASB 101
Key Requirements
Impact
There will be no
significant
impact on the
Group on the
adoption of this
standard.
The Group is
currently
conducting an
exercise of
reviewing
financial report
disclosures.
This standard makes amendments
to AASB 101 Presentation of
Financial Statements arising from
the IASB’s Disclosure Initiative
Project. The amendments are
designed to further encourage
companies to apply professional
judgment in determining what
information to disclose in the
financial statements.
The amendments also clarify that
companies should use
professional judgment in
determining where and in what
order in formation is to be
presented in the financial
disclosures.
There are no other standards that are not yet effective and that would be expected to have a material impact on Range in the
current or future period and on foreseeable future transactions.
Note 40: Company Details
The registered office of the company is:
Ground Floor, BGC Centre
28 The Esplanade
Perth WA 6000
Australia
Telephone: +61 8 6205 3012
Facsimile: +61 8 6316 2211
The principal place of business is:
Ground Floor, BGC Centre
28 The Esplanade
Perth WA 6000
Australia
Telephone: +61 8 6205 3012
Facsimile: +61 8 6316 2211
107
The directors of the company declare that:
DIRECTORS’ DECLARATION
1.
2.
3.
4.
The financial statements, comprising the consolidated statement of profit or loss and other comprehensive income,
consolidated statement of financial position, consolidated statement of cash flows, consolidated statement of changes in
equity, accompanying notes, are in accordance with the Corporations Act 2001 and:
(a)
(b)
comply with Accounting Standards and the Corporations Regulations 2001 and other mandatory professional
reporting requirements; and
give a true and fair view of the Group’s financial position as at 30 June 2015 and of its performance for the year
ended on that date.
The company has included in the notes to the financial statements an explicit and unreserved statement of compliance
with International Financial Reporting Standards.
In the directors’ opinion, there are reasonable grounds to believe that the company will be able to pay its debts as and
when they become due and payable.
The directors have been given the declarations by the chief executive officer and chief financial officer required by section
295A.
This declaration is made in accordance with a resolution of the Board of Directors and is signed for and on behalf of the
directors by:
___________________________
David Chen
Chairman
30 September 2015
108
Tel: +61 8 6382 4600
Fax: +61 8 6382 4601
www.bdo.com.au
38 Station Street
Subiaco, WA 6008
PO Box 700 West Perth WA 6872
Australia
INDEPENDENT AUDITOR’S REPORT
To the members of Range Resources Limited
Report on the Financial Report
We have audited the accompanying financial report of Range Resources Limited, which comprises the
consolidated statement of financial position as at 30 June 2015, the consolidated statement of profit or
loss and other comprehensive income, the consolidated statement of changes in equity and the
consolidated statement of cash flows for the year then ended, notes comprising a summary of
significant accounting policies and other explanatory information, and the directors’ declaration of the
consolidated entity comprising the company and the entities it controlled at the year’s end or from
time to time during the financial year.
Directors’ Responsibility for the Financial Report
The directors of the company are responsible for the preparation of the financial report that gives a
true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001
and for such internal control as the directors determine is necessary to enable the preparation of the
financial report that gives a true and fair view and is free from material misstatement, whether due to
fraud or error. In Note 1, the directors also state, in accordance with Accounting Standard AASB 101
Presentation of Financial Statements, that the financial statements comply with International
Financial Reporting Standards.
Auditor’s Responsibility
Our responsibility is to express an opinion on the financial report based on our audit. We conducted our
audit in accordance with Australian Auditing Standards. Those standards require that we comply with
relevant ethical requirements relating to audit engagements and plan and perform the audit to obtain
reasonable assurance about whether the financial report is free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in
the financial report. The procedures selected depend on the auditor’s judgement, including the
assessment of the risks of material misstatement of the financial report, whether due to fraud or error.
In making those risk assessments, the auditor considers internal control relevant to the company’s
preparation of the financial report that gives a true and fair view in order to design audit procedures
that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the company’s internal control. An audit also includes evaluating the appropriateness
of accounting policies used and the reasonableness of accounting estimates made by the directors, as
well as evaluating the overall presentation of the financial report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our audit opinion.
BDO Audit (WA) Pty Ltd ABN 79 112 284 787 is a member of a national association of independent entities which are all members of BDO Australia Ltd ABN
77 050 110 275, an Australian company limited by guarantee. BDO Audit (WA) Pty Ltd and BDO Australia Ltd are members of BDO International Ltd, a UK
company limited by guarantee, and form part of the international BDO network of independent member firms. Liability limited by a scheme approved under
Professional Standards Legislation, other than for the acts or omissions of financial services licensees.
Independence
In conducting our audit, we have complied with the independence requirements of the Corporations
Act 2001. We confirm that the independence declaration required by the Corporations Act 2001, which
has been given to the directors of Range Resources Limited, would be in the same terms if given to the
directors as at the time of this auditor’s report.
Opinion
In our opinion:
(a)
the financial report of Range Resources Limited is in accordance with the Corporations Act 2001,
including:
(i)
giving a true and fair view of the consolidated entity’s financial position as at 30 June 2015
and of its performance for the year ended on that date; and
(ii) complying with Australian Accounting Standards and the Corporations Regulations 2001; and
(b)
the financial report also complies with International Financial Reporting Standards as disclosed in
the Note 1.
Report on the Remuneration Report
We have audited the Remuneration Report included in the directors’ report for the year ended 30 June
2015. The directors of the company are responsible for the preparation and presentation of the
Remuneration Report in accordance with section 300A of the Corporations Act 2001. Our responsibility
is to express an opinion on the Remuneration Report, based on our audit conducted in accordance with
Australian Auditing Standards.
Opinion
In our opinion, the Remuneration Report of Range Resources Limited for the year ended 30 June 2015
complies with section 300A of the Corporations Act 2001.
BDO Audit (WA) Pty Ltd
Jarrad Prue
Director
Perth, 30 September 2015
RANGE RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 88 002 522 009
TENEMENT INTERESTS
Range’s portfolio of exploration, development and production assets at 30 June 2015:
Tenement Reference
Location
Working Interest
Operator
Morne Diablo
South Quarry
Beach Marcelle
Guayaguayare Shallow*
Guayaguayare Deep*
St Mary’s Block
Trinidad
Trinidad
Trinidad
Trinidad
Trinidad
Trinidad
100%
100%
100%
65%
80%
80%
Range
Range
Range
Range
Range
Range
Block 1-2005, South Peten Basin
Guatemala
20% Latin American Resources Ltd
Block Vla
PUT-5, Putumayo basin
VMM-7, Magdalena Valley
VSM-1, Magdalena Valley
Notes:
Georgia
Colombia
Colombia
Colombia
45%
10%
10%
10%
Strait Oil & Gas
Optima Oil Corp
Optima Oil Corp
Optima Oil Corp
*During the period, Range signed an amendment agreement in respect of its interest in the Guayaguayare Block in Trinidad.
Subject to final government approvals, Range will take over as Operator and will hold 80% interest in the Deep PSC and 65%
interest in the Shallow PSC.
111
RANGE RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 88 002 522 009
SHAREHOLDER STATISTICS
Additional information provided pursuant to ASX listing rule 4.10 and not shown elsewhere in this report:
(a) A distribution schedule of the number of holders in each class of equity securities as at 31 August 2015:
Ordinary Shares
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 – 9,999,999,999
Total
No. of holders
No. of shares held
1,082
1,179
658
1,540
619
5,078
382,716
3,426,202
5,322,506
57,595,333
5,700,442,431
5,767,169,188
Listed Options ($0.05, 31 January 2016)
No. of holders
No. of options held
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 – 9,999,999,999
Total
1
–
19
3
36
59
876
–
190,000
175,000
80,142,465
80,508,341
(b) The number of holders holding less than a marketable parcel as at 31 August 2015 of fully paid shares
was 3,943 holders and of listed options was 32 holders.
(c) The names of the 20 largest holders of fully paid shares, the number of fully paid shares each holds and
the percentage of capital each holds as at 31 August 2015:
Top 20 Holders of Fully Paid Shares
Rank Name
No. of shares held
% held
1.
2.
Computershare Clearing Pty Ltd
Abraham Limited
3.
Beijing Sibo Investment Management LP
4.
5.
6.
7.
8.
Citicorp Nominees Pty Limited
J P Morgan Nominees Australia Limited
BBY Nominees Limited
Mr David Scanlen
Mr Pieter Hoekstra + Mrs Ruth Hoekstra
3,764,124,232
712,377,560
650,000,000
58,807,342
40,845,412
34,596,161
20,070,693
17,362,488
65.27
12.35
11.27
1.02
0.71
0.60
0.35
0.30
112
RANGE RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 88 002 522 009
HSBC Custody Nominees (Australia) Limited
Mr Phong Nguyen
Mr David Chen
All Door Services Pty Ltd
Celtic Capital Pte Ltd
Mr Paul Frederick Bennett
Immobiliare` Investments Pty Ltd
Ziziphus Pty Ltd
Mr Mohamed Hersi
G & D Finn Pty Ltd
Mrs Lingling Wei
9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
19.
20.
National Nominees Limited
16,739,738
13,000,000
10,288,070
10,192,258
9,999,790
8,035,476
8,000,000
6,336,925
5,028,416
5,000,870
4,828,061
4,109,579
0.29
0.23
0.18
0.18
0.17
0.14
0.14
0.11
0.09
0.09
0.08
0.07
Total
5,399,638,071
93.63
(d) The names of the substantial holders of fully paid shares, the number of fully paid shares each holds
and the percentage of capital each holds as at 31 August 2015:
Rank Name
No. of shares held
% held
1.
2.
Computershare Clearing Pty Ltd
Abraham Limited
3.
Beijing Sibo Investment Management LP
3,764,124,232
712,377,560
650,000,000
65.27
12.35
11.27
(e) The names of the 20 largest holders of listed option holders, the number of listed options each holds
and the percentage of capital each holds as at 31 August 2015:
Top 20 Holders of Listed Options ($0.05, 31 January 2016)
Rank Name
No. of options held
% held
1.
2.
3.
4.
5.
6.
7.
8.
ABN Amro Clearing Sydney Nominees Pty Ltd
Mrs Kristin Eileen Franco
Satori International Pty Ltd
Mr Ivan Brown
Chimaera Capital Limited
Mr Bastian Michael Uber
G & D Finn Pty Ltd
HSBC Custody Nominees (Australia) Limited
12,874,000
10,616,671
8,900,000
7,175,457
4,229,087
4,150,000
4,000,000
4,000,000
15.99
13.19
11.05
8.91
5.25
5.15
4.97
4.97
113
RANGE RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 88 002 522 009
9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
19.
20.
City Corp Pty Ltd
Mrs Shelly Mary Therese Duncan
Mr Ronan O'Murchu
Mrs Vita Pelly
Mr Sebastian Lamicela
Mr Raymond Peter Cunneen
Mr Scott Duncan
Noble 888 Pty Ltd
Mr Walter Graham
Mr Mihirkumar Ranchhodbhai Patel
Pathat Pty Ltd
Mrs Sheryl Lee Ireson
Total
2,470,000
2,300,000
1,774,600
1,600,000
1,312,247
1,295,000
1,170,000
1,091,306
1,000,000
1,000,000
1,000,000
990,000
3.07
2.86
2.20
1.99
1.63
1.61
1.45
1.36
1.24
1.24
1.24
1.23
72,948,368
90.61
(f) The names of the substantial holders of listed option holders, the number of listed options each holds
and the percentage of capital each holds as at 31 August 2015:
Rank Name
No. of options held
% held
1.
2.
3.
4.
5.
6.
ABN Amro Clearing Sydney Nominees Pty Ltd
Mrs Kristin Eileen Franco
Satori International Pty Ltd
Mr Ivan Brown
Chimaera Capital Limited
Mr Bastian Michael Uber
12,874,000
10,616,671
8,900,000
7,175,457
4,229,087
4,150,000
15.99
13.19
11.05
8.91
5.25
5.15
Voting rights
Subject to the constitution and to any rights or restrictions attaching to any class of shares, every member is entitled
to vote at a general meeting of the Company. Subject to the constitution and the Corporations Act 2001, every
member present in person or by proxy, representative or attorney at a general meeting has, on a show of hands, one
vote, and on a poll, one vote for each fully paid share held by the member.
114
RANGE RESOURCES LIMITED
AND CONTROLLED ENTITIES
ABN 88 002 522 009
CORPORATE DIRECTORY
Directors
David Yu Chen Non-Executive Chairman
Yan Liu
Zhiwei Gu
Juan Wang
Executive Director and CEO
Non-Executive Director
Non-Executive Director
Auditors
BDO Audit (WA) Pty Ltd
38 Station Street
Subiaco WA 6008
Australia
Share Registry (Australia)
Computershare Investor Services Pty Ltd
Share Registry (United Kingdom)
Computershare Investor Services plc
Stock Exchange
Australian Stock Exchange Limited (ASX)
Alternative Investment Market of the London
Stock Exchange (AIM)
ASX Code: RRS
AIM Code: RRL
Company Secretary (Joint)
Nick Beattie
Sara Kelly
Registered Office
Ground Floor, BGC Centre
28 The Esplanade
Perth WA 6000
Australia
Telephone: +61 8 6205 3012
Facsimile: +61 8 6316 2211
Principal Place of Business
Ground Floor, BGC Centre
28 The Esplanade
Perth WA 6000
Australia
Telephone: +61 8 6205 3012
Facsimile: +61 8 6316 2211
Website
www.rangeresources.co.uk
Country of Incorporation
Australia
115