Interim Results

RNS Number : 7545N
Ascent Resources PLC
07 September 2011
 



Ascent Resources plc / Epic: AST / Index: AIM / Sector: Oil and Gas

 

Ascent Resources plc ('Ascent' or 'the Company')

Interim Results - New Gas Reserves Discovered in Slovenia

 

Ascent Resources plc, the AIM listed European oil and gas production and exploration company, announces its unaudited interim results for the six months ended 30 June 2011.

 

Highlights

 

•       Slovenian appraisal drilling at Ascent operated Petišovci Project completed;

o  Two deep wells drilled as planned

o  Middle Miocene reservoirs present and gas bearing as evaluated by RPS

o  Pg-11A - discovered 114m new net pay in deeper Miocene reservoirs, Pg-10 - confirmed lateral extent of the discovery with 123m net pay in deeper Miocene reservoirs

•       Slovenian gas production now anticipated mid 2012

•       Commerciality report undertaken by PDC demonstrates significant expected value in Petišovci Project

•       Acquired additional 48.75% interest in Petišovci from Enquest

•       Raised £17m in an equity placing to rapidly advance the Petišovci Project to early gas production

•       Fracture stimulations on Pg-11A and Pg-10 being undertaken shortly by Halliburton which will be funded from existing cash resources

•       Cash flow continues from gas production at the Penészlek project in eastern Hungary

•       Hermrigen-2 drilling and site construction permit has been received from Swiss authorities

 

Ascent Managing Director Jeremy Eng said, "Considerable progress has been made during the period under review, notably at our Slovenian operations where Ascent operates the Petisovci Project and holds a 75% interest alongside partner and concessionaire, Geoenergo d.o.o.  The successful raising of £17m from UK institutional investors in March has allowed the second phase of the drilling campaign at the Petišovci project to be largely completed.  The two wells drilled this year have discovered 114m new net pay at the Pg-11A location and confirmed 123m of net pay in the deeper Miocene reservoirs at Pg-10, of which 63m was of moderate to good sand quality.  These positive results validate our strategy and we now look forward to the fracture stimulation of the two wells and exploiting their commercial potential in the near future.  Once the results of the fracture stimulation have been fully interpreted, it is expected a detailed field development plan will be drawn up for long term production. 

 

"The outlook in the medium and long term for European energy prices is favourable and the successful drilling campaign during the period at Ascent's gas assets in Slovenia puts us in a strong position to commercialise what I believe will be a game changing asset for us".

 

For further information visit www.ascentresources.co.uk or contact:

 

Jeremy Eng

Managing Director - Ascent Resources plc

Tel: 020 7251 4905

Scott Richardson Brown

Finance Director - Ascent  Resources plc


Sarah Wharry

Corporate Finance - finnCap Ltd

Tel: 020 7220 0500

Ben Thompson

Corporate Finance - finnCap Ltd


Simon Starr

Corporate Broking - finnCap Ltd


Hugo de Salis

St Brides Media & Finance Ltd

Tel: 020 7236 1177

 

Strategy and Current Operations Review

Ascent now has a balanced collection of assets comprising three core projects (Petišovci/Lovászi/Ujfalu in Slovenia/Hungary, Hermrigen in Switzerland, and the Latina Valley in Italy) and a number of longer term non-core projects.  These projects are in line with the Company's strategy of targeting productive formations in areas with existing hydrocarbon infrastructure within Europe.  The Company is now focussed on extracting value from these core assets through an aggressive work programme that started in the first half of 2011.  Utilising the latest technology, Ascent will optimise the recovery from these fields whilst at the same time maintain a strict control of costs by using local offices and services where possible.  In parallel, the Company is promoting the non-core assets to the core portfolio through an early stage, low spend work programme and asset management strategy.  Overall, the Company's assets strike a good balance between exploitation of known reserves and higher risk/higher return exploration.  The core assets have the potential to grow production substantially in the near term and generate value through a combination of exploration, appraisal and development.

 

Currently the Company's primary objective is to rapidly advance the core Petišovci/Lovászi/Ujfalu tight gas project in Slovenia/Hungary, which has an independently estimated P50 gas-in-place ('GIP') estimate of 412Bcf with substantial upside from the new deeper Middle Miocene reservoirs found at Pg-11A and Pg-10.  In March this year, £17m was raised for a three well near-term programme to commence on this project, so far this has funded the drilling of Pg-11A and Pg-10.  The drilling results have delineated larger quantities of gas than originally expected. Later this year, the interpretation of the flow test and other technical data from the upcoming fracture stimulation and testing programme will help define the optimum route to early gas production. The intention is to commence commercial gas production at Petišovci around the middle of 2012 following the installation of a CO2 reduction plant and a short pipeline connecting the wells to the national gas grid.

 

The Company's interests are largely geographically spread across on-shore Europe and are therefore well placed to take advantage of the favourable European energy market.  Recent, short term market volatility has not changed the attractive fundamentals of the European gas market where over 50% of Europe's gas is currently imported, a figure set to rise to nearly 75% by 2030 according to Wood MacKenzie.  With security of energy supply high on the political and economic agenda in much of Europe, high energy prices look set to support gas exploration and production for the foreseeable future.

 

Core Projects

Petišovci/Lovászi/Ujfalu Exploration and Development: 

The 200 km2 project area straddles the Hungary/Slovenia border and contains three former oil and gas fields.  Geoenergo d.o.o. is the holder of the Petišovci Exploitation Concession and is a company jointly owned by Nafta Lendeva, the Slovenian State Oil Company and Petrol, the leading energy conglomerate in Slovenia.  Ascent through its wholly owned subsidiary Ascent Slovenia Limited, has a 75% interest in the Petišovci Project.  Ascent's partner is Geoenergo with a 25% interest. This project is in line with the Company's strategy of targeting undeveloped tight gas reservoirs with substantial, independently verified gas in place of over 400Bcf.  Production at the project is expected to commence in the middle of 2012 should the fracture stimulation be successful as expected later this year.  In the Hungarian part of the project area, Ascent holds a 50% interest in a joint venture with MOL, the leading Hungarian oil and gas company.

 

In Slovenia, Phase 1 commenced with the drilling of Pg-11, the first well in 22 years to be drilled in the field.  The well was completed in February 2011 and all six (A to F) Middle Miocene reservoirs targeted were gas bearing.  A previously unknown new gas reservoir was also found below a depth of around 3,000m.

 

Following the successful fund raising, Phase 2 of the programme started with the Pg-11A sidetrack to explore this potential deeper reservoir.  The drilling results confirmed a new Middle Miocene reservoir from which gas and condensate was sampled.  The shallowest 'A' sands also flowed gas for the first time in the history of this field.  Three cores recovered from Pg-11A in the A, D and E sands and a full log data suite were analysed for a range of petrophysical parameters including permeability and porosity.  On drilling Pg-11A to 3,500m, well logs indicated approximately 114m of additional new net pay in the lower reservoir section. 

 

Pg-10, was drilled approximately 2km to the west of Pg-11 to a depth of 3,545m to help delineate the areal extent of the reservoirs.  It encountered 123m of new net pay which it is provisionally estimated will add at least 200Bcf GIP resource.  Further tests are planned to ascertain how best to optimise commercial production from these wells.

 

Phase 2 of the work programme, whose objective was to evaluate production completions based on the analysis of the data already acquired, is now largely finished.  Both Pg-10 and Pg-11A are now completed in preparation for fracture stimulation.

 

Phase 3 has commenced with the appointment of Halliburton to design and implement a fracture stimulation programme and then test both wells to determine if they can produce at commercial gas flow-rates. 

 

Prior to starting the second phase of the project, the purchase of EnQuest's 48.75% stake in Petišovci was completed, the transaction was announced in December 2010.  Ascent thereby increased its interest to 75%.  As a result of the deal, EnQuest has become the largest shareholder in Ascent, has appointed one of its own senior managers to Ascent's board and has made its technical resources available to the Company.

 

As a result of the £17m fund raising, Ascent expects to have sufficient financial resources available to bring Pg-10 and Pg-11A into production following the fracture stimulations which are expected to be performed on both Pg-11A and Pg-10 in September and October 2011.  At the time of the fund raising Ascent planned a three well drilling campaign with Pg-11A and Pg-10 in Slovenia and the Ujfalu-III well just across the border in the Hungarian part of the project area.  However, as the permit for the latter well has not yet been issued, the well is now expected to be drilled in 2012, and the Crosco Cardwell-1 drilling unit has been demobilised from the project area. 

 

Ascent has today published on its website (http://www.ascentresources.co.uk/pages/publications) a summarised commerciality report undertaken by Petroleum Development Consultants Ltd ('PDC') for the Petišovci joint venture.  The report is a detailed study of the expected commercial potential of the Petišovci Project, providing information on the local supply and demand for gas, the transportation network and infrastructure, pricing, production and development expectations.  This independent report confirms Ascent's belief that the project has the potential to provide very significant value creation for shareholders.

 

Hermrigen and Linden, Switzerland

The exploration permits cover undeveloped discoveries made by Elf Aquitane in 1972 and 1982 with a combined estimated gas resource base of over 360 Bcf.  As the original Hermrigen well was drilled before gas pipeline infrastructure was built in the area, the discovery remained unappraised.  eCORP is the operator of the project  and despite selling its interest last year, Ascent retains various back-in rights on any successful outcome of six conventional appraisal prospects, provided relevant apportioned costs are covered.   Subject to the discovery of conventional gas or oil reserves in any of the six prospects, Ascent can participate with either 45% or 22.5% in the development of those reserves. 

 

Slow progress on the permitting has delayed the planned drilling operations but the drilling permit has now been received and the wellsite construction permit was issued on Monday 5th September.  Ascent now looks forward to working with eCORP to ensure the appraisal well on this prospect is drilled as soon as possible.

 

Latina Valley Exploration and Redevelopment: 

The Strangolagalli concession lies in a proven oil producing area.  The project involves the redevelopment of the Ripi field, originally developed in 1960 without the benefit of any seismic data.  The oil is of good quality from shallow reservoirs less than 1,000m deep.  New seismic was acquired last year and drilling plans are being drawn up based on the interpretation of the new data.  Four wells were originally planned for later this year and next, however, the drilling permit has still not been issued and it is therefore more likely that drilling will now commence next year. 

 

As with Strangolagalli, the Frosinone exploration licence targets shallow oil lying at less than 1,000m. New 2D seismic acquisition is planned to follow up on satellite reconnaissance that confirmed existing targets and identified new ones.

 

Producing Assets

Penészlek Gas Production Project (48.78%): 

Production from the PEN-101 and PEN-105 wells continues to flow at approximately 1.1MMscfd (32,000 Msm3/d; 200 Boepd), equating to monthly gas sales of around €300,000.  The production at Penészlek benefits from low overheads due to the use of existing onsite facilities and a favourable location.  The gas is sold via a dedicated automated facility directly into the Hungarian gas pipeline network.  The final expected development of the field is the PEN-105A sidetrack which will be drilled when current production from PEN-105 comes to an end.

 

Non-core Assets

Po Valley, Italy (100%):  Gas exploration project in Italy's prolific northern gas basin.  Following satellite reconnaissance, new seismic is proposed for 2012.

 

Vaud, Switzerland:  As part of last year's asset divestment to eCORP, new seismic is proposed to delineate a drilling location.  Ascent retains a 22.5% back-in right.

 

Offshore Netherlands: M10/11 Gas Appraisal:  An application to extend the Company's license area in the Netherlands has been lodged.  A formal response from the authorities is expected in due course.

 

Other Activities - Board Structuring:

Graham Cooper was appointed as a non-executive director following the transaction with EnQuest in February of this year.  Graham is head of business development at EnQuest, having previously been a vice president of global exploration at Shell.  As a trained geologist he brings valuable experience to the Board and his appointment underpins EnQuest's support of Ascent's management. 

 

Financial Review 

Results for the period:

The Board is reporting a loss of £2.2m in line with management's expectations.  The results for the period reflect continued development of the Group's assets, principally in Hungary and Slovenia.  As set out in the Operations Review there has been a wide range of drilling, testing and geological activity in the period.  Given the impairment of certain exploration expenditure and the timing of revenue, the loss for the period was as expected.

 

Liquidity and Capital Resources:

The Company continues to be an emerging business with limited production cash flows; consequently, it manages its working capital and liquidity position by balancing the timing of critical expenditure with income from joint venture arrangements and, where appropriate, proceeds from strategic divestments.  Further information on future funding arrangements and the Directors' assessment of the Group's going concern position is set out in note 1 of these Interim Financial Statements.

 

In July, the Company placed convertible loan notes with existing Italian creditors, raising €552,525 with an option to issue a further €70,000 in the future.  The loan notes are unsecured, have an annual coupon of 8.5% and are convertible into Ordinary Shares in the Company at a conversion price of 12p per Ordinary Share on or before 31 December 2013.   The proceeds will go towards advancing Ascent's Italian portfolio.

 

Principal Risks and Uncertainties:

The principal risks and uncertainties affecting the business activities of the Group remain those detailed on pages 75 -79 of the Annual Review 2010, a copy of which is available on the Company's website at www.ascentresources.co.uk. 

 

The interim financial information to 30 June 2011 and 30 June 2010 is unaudited and does not constitute statutory financial information.  The information given for the year ended 31 December 2010 does not constitute statutory accounts within the meaning of Section 19 of the Companies (Amendment) Act 1986.  The statutory accounts for the year ended 31 December 2010 have been filed with the Registrar and are available on the Company's web site www.ascentresources.co.uk.

 

On behalf of the Board of Directors

J Eng, Managing Director

7 September 2011

 

 

Consolidated Statement of Changes in Equity

For the period ended 30 June 2011

Share

capital

Equity Reserve

Share

premium

Share based payment reserve

Translation Reserve

Retained

earnings

Total

Non-controlling interest

Total

equity


£000's

£000's

£000's

£000's

£000's

£000's

£000's

£000's

£000's











Balance at 1 January 2010 (audited)

500

84

22,540

2,496

2,873

(19,853)

8,640

174

8,814

Comprehensive income










Profit for the period

-

-

-

-

-

448

448

-

448

Other comprehensive income:










Currency translation differences

-

-

-

-

(780)

-

(780)

-

(780)

Transactions with owners










Issue of shares during the period

15

-

827

-

-

-

842

-

842

Purchase of non-controlling interest

-

-

-

-

-

174

174

(174)

-

Share based payments

-

-

-

71

-

-

71

-

71

Balance at 30 June 2010 (unaudited)

515

84

23,367

2,567

2,093

(19,231)

9,395

-

9,395

Comprehensive income










Loss for the period

-

-

-

-

-

(577)

(577)

-

(577)

Other comprehensive income:










Currency translation differences

-

-

-

-

835


835

-

835

Transactions with owners










Convertible Loan

-

(34)

-

-

-

84

50

-

50

Issue of shares during the period

5

-

196

-

-

-

201

-

201

Share based payments

-

-

-

69

-

-

69

-

69

Reserve transfer

-

-

-

(724)

-

724

-

-

-

Balance at 31 December 2010 (audited)

520

50

23,563

1,912

2,928

(19,000)

9,973

-

9,973

Comprehensive income










Loss for the period

-

-

-

-

-

(2,198)

(2,198)

-

(2,198)

Other comprehensive income:










Currency translation differences

-

-

-

-

653

-

653

-

653

Transactions with owners










Issue of shares during the period

506

-

28,635

-

-

-

29,141

-

29,141

Share based payments

-

-

-

2,538

-

-

2,538

-

2,538

Balance at 30 June 2011 (unaudited)

1,026

50

52,198

4,450

3,581

(21,198)

40,107

-

40,105

 

Consolidated Statement of Financial Position

As at 30 June 2011
 

30 June 2011


30 June 2010


31 December 2010


Notes

£ 000's


£ 000's


£ 000's

Assets














Non-current assets







Property, plant and equipment


770


1,796


2,045

Exploration and decommissioning costs

7

31,890


8,674


9.536








Total non-current assets


32,660


10,470


11,581








Current assets







Inventories


313


368


341

Trade and other receivables

8

1,523


2,025


1,664

Cash and cash equivalents


11,019


3,023


2,048








Total current assets


12,855


5,416


4,053















Total assets


45,515


15,886


15,634








Equity and liabilities







Attributable to the equity holders of the parent company







Share capital


1,026


515


520

Equity reserve


50


84


50

Share premium account


52,198


23,367


23,563

Share based payment reserve


4,450


2,567


1,912

Translation reserves


3,581


2,093


2,928

Retained earnings


(21,198)


(19,405)


(19,000)








 

Total equity


40,107


9,221


9,973















Non-current liabilities







Borrowings

10

-


318


-

Provisions


677


132


594








Total non-current liabilities


677


450


594















Current liabilities







Trading and other payables

9

4,370


3,004


2,314

Borrowings

10

361


3,211


2,753








Total current liabilities


4,731


6,215


5,067















Total liabilities


5,408


6,665


5,661















Total equity and liabilities


45,515


15,886


15,634








 






Consolidated Statement of Cash Flows

for the six months ended 30 June 2011







Six months ended 30 June 2011


Six months ended 30 June 2010


Year ended 31 December

2010

 

Cash used in operations

£ 000's


£ 000's


£ 000's

(Loss)/profit before tax

(2,198)


274


(129)

Depreciation charge

1,427


213


953

Decrease in receivables

141


1,790


1,359

Decrease in payables

(69)


(3,696)


(25)

Decrease in inventories

28


63


90

Profit on sale of subsidiary

-


(3,816)


(5,899)

Loss on sale of equity accounted investee

-


74


-

Loss/(Profit) on sale of current asset investments

-


406


(5)

Impairment of exploration expenditure

373


1,259


3,099

Increase/(decrease) in decommissioning provision

85


(20)


409

Share-based payment charge

232


71


140

Exchange differences

-


(65)


-








19


(3,447)


(8)

Finance income

(43)


(36)


(26)

Finance cost

256


1,105


1,127







Net cash generated/(used) in operating activities

232


(2,378)


1,093













Cash flows from investing activities






Interest received

13


36


26

Payments for investing in exploration

(5,082)


(3,912)


(9,091)

Acquisition of property, plant and equipment

-


-


(529)

Proceeds from disposal of subsidiary

-


4,463


7,032

Costs of disposal of subsidiary

-


(116)


(601)

Proceeds from disposal of equity accounted investee

-


252


1,191

Proceeds from disposal of current asset investment

-


831


51







Net cash flows used in investing activities

(5,069)


1,554


(1,921)







Cash flows from financing activities






Interest paid

(128)


(174)


(512)

Loans repaid

(2,505)


(297)


(3,110)

Proceeds from issue of shares

17,412


-


50

Proceeds from loan notes

-


-


2,100







Net cash flows from financing activities

14,043


(471)


(1,472)







Net increase/(decrease) in cash and cash equivalents for the period

9,206


(1,295)


(2,300)







Net foreign exchange differences

(235)


(312)


(282)

Cash and cash equivalents at beginning of the period

2,048


4,630


4,630







Cash and cash equivalents at end of the period

11,019


3,023


2,048







 

Material non- cash transaction - As detailed in Note 7, the Group acquired exploration assets in exchange for shares and nil cost options with a value of £14,093,000.

 

Notes to the Financial Statements

For the Period ended 30 June 2011

 

Reporting entity

 

Ascent Resources plc ('the Company') is a company domiciled in England. The address of the Company's registered office is One America Square, Crosswall, London EC3N 2SG. The unaudited consolidated interim financial statements of the Company as at 30 June 2011 comprise the Company and its subsidiaries (together referred to as the 'Group') and the Group's interest in associates.

 

Basis of preparation

 

The interim financial statements have been prepared using policies based on International Financial Reporting Standards (IFRS and IFRIC interpretations) issued by the International Accounting Standards Board (IASB) as adopted for use in the EU. The interim financial information has been prepared using the accounting policies which will be applied in the Group's statutory financial statements for the year ended 31 December 2011 and were applied in the Group's statutory financial statements for the year ended 31 December 2010.

 

All amounts have been prepared in British Pounds, this being the Group's presentational currency.

 

Going Concern

 

The financial statements of the Group are prepared on a going concern basis.

 

In common with many similar companies, the Group raises finance for their exploration and appraisal activities in discrete tranches. Ultimately, the Group must either raise additional tranches of funding and/or generate sufficient net cash flows from operations.

 

The Directors are of the opinion that the Group will have sufficient cash to fund its activities based on forecast cash flow information for a period in excess of twelve months from the date of these financial statements' approval. Management continues to monitor all working capital commitments and balances on a weekly basis and believe that they have access to appropriate levels of financing for the Group to continue to meet their liabilities as they fall due for at least the next twelve months and is trading as a going concern.

 

In preparing base and sensitised cash flow forecasts the Directors have identified a number of cash receipts and cash payments where they have had to use their best judgement to make certain estimates.

 

The base case forecasts are prepared using estimates of planned production from producing fields, future gas prices and estimates of costs for planned exploration activities.  On a number of projects certain assumptions have also been made with regard to working capital management and matching cash inflows from cash calls to cash outflows.

 

Accordingly, the Directors have also prepared sensitised forecasts to reflect the risk that production volumes and gas prices may be lower than estimated and exploration costs may be higher.  These forecasts indicate that the Group can continue to operate within existing facilities (including the Standby Equity Distribution agreement) for the foreseeable future.  If the amount or timing of forecast inflows and outflows were to change adversely the Group may be required to reconsider discretionary exploration activity and/or seek additional bridging finance to meet any shortfall.

 

 

 

2

Financial reporting period

 

The interim financial information for the period 1 January 2011 to 30 June 2011 is unaudited. In the opinion of the Directors the interim financial information for the period presents fairly the financial position, and the results from operations and cash flows for the period are in conformity with generally accepted accounting principles consistently applied. The financial information is prepared using the accounting policies which will be applied in the Group's statutory financial statements for the year ending 31 December 2011. The financial statements incorporate unaudited comparative figures for the interim period 1 January 2010 to 30 June 2010 and the audited financial year to 31 December 2010.

 

The financial information contained in this interim report does not constitute statutory accounts as defined by section 435 of the Companies Act 2006.

 

The comparatives for the full year ended 31 December 2010 are not the Group's full statutory accounts for that year. A copy of the statutory accounts for that year has been delivered to the Registrar of Companies. The auditors' report on those accounts was unqualified and did not include references to any matters to which the auditors drew attention by way of emphasis without qualifying their report and did not contain a statement under section 498(2)-(3) of the Companies Act 2006.

 

3

Cost of sales

30 June 2011

 


30 June 2010

 


31 December 2010



£ 000's


£ 000's


£000's









Operating Costs relating directly to producing assets

60


46


402


DD&A of producing assets

1,426


186


732


Other directly incurred costs

305


99


245










1,791


331


1,379






















4

Administrative Expenses

30 June 2011

 


30 June 2010

 


31 December 2010



£ 000's


£ 000's


£000's









Depreciation of property, plant and equipment

-


9


-


Employee Costs

413


397


1,183


Consulting charges

57


60


128


Other office costs

523


490


1,078










993


956


2,389






















5

Finance income and costs recognised in loss

30 June 2011

 


30 June 2010

 


31 December 2010



£ 000's


£ 000's


£000's









Financial Income














Income on bank deposits

13


15


13


Foreign exchange movements realised

30


16


8










43


31


21









Financial Costs














Interest payable on borrowings

(135)


(158)


(375)


Foreign exchange movements realised

(3)


(853)


(752)










(138)


(1,011)


(1,127)






















6

(Loss)/Profit per share

Period ended 30 June 2011


Period ended 30 June 2010


Year ended 31 December 2010


(Loss)/Profit

£ 000's


£ 000's


£ 000's


 

(Loss)/Profit for the purposes of basic earnings per share being net loss attributable to equity shareholders







From continuing operations

(2,198)


(3,294)


(6,028)


From discontinued operations

-


3,742


5,899


From total operations

(2,198)


448


(129)









(Loss)/profit for the purposes of diluted earnings per share being adjusted net loss attributable to equity shareholders

 

 


 

 




From continuing operations

(2,198)


(3,294)


(6,013)


From discontinued operations

-


3,742


5,899


From total operations

(2,198)


448


(114)









Number of shares








Number


Number


Number


Weighted average number of ordinary shares for the purposes of basic earnings per share

815,006,995


509,575,237


513,383,470
















Number of shares








Number


Number


Number


Weighted average number of ordinary shares for the purposes of diluted earnings per share

815,006,995


508,875,237


518,634,913











The calculation of diluted earnings per share assumes conversion of all potentially dilutive ordinary shares.  Dilutive shares arise from share options, warrants and the convertible bond held by the Company.  A calculation is done to determine the number of shares that could have been acquired at fair value, based upon the monetary value of the subscription rights attached to outstanding share options, warrants and convertible bonds.

 

7

Exploration costs - Group








Italy

Hungary

Slovenia

Netherlands

Total



£ 000's

£ 000's

£ 000's

£ 000's

£ 000's


Cost







At 1 July 2010

12,088

6,099

3,863

144

22,194


Additions

(418)

156

1,631

190

1,559


Disposals

-

(261)

-

-

(261)


Impairment

-

-

(1,853)

-

(1,853)


Additions  to decommissioning asset

208

22

201

-

431


Effects of movements in exchange rates

741

515

227

25

1,508


Transfer to property, plant and equipment

-

(527)

-

-

(527)


At 31 December 2010

12,619

6,004

4,069

359

23,051









At 1 January 2011

12,619

6,004

4,069

359

23,051


Additions

265

49

21,680

-

21,994


Effects of movements in exchange rates

701

375

460

2

1,538


At 30 June 2011

13,585

6,428

26,209

361

46,583









Impairment







At 1 July 2010

8,842

3,911

-

88

12,841


Charge for the period

14

(28)

-

-

(14)


Disposal

-

(74)

-

-

(74)


Effects of movements in exchange rates

512

246

-

4

762


At 31 December 2010

9,368

4,055

-

92

13,515









At 1 January 2011

9,368

4,055

-

92

13,515


Charge for the period

-

373

-

-

373


Effects of movements in exchange rates

458

341

-

6

805


 At 30 June 2011

9,826

4,769

-

98

14,693









Carrying value














At 30 June 2011

3,759

1,659

26,209

263

31,890









At 31 December 2010

3,251

1,949

4,069

267

9,536









At 1 July 2010

3,246

1,509

3,863

56

8,674









During the period, Ascent entered into an agreement with EnQuest Plc ("EnQuest") to acquire their 48.75% interest in the Petisovci interest in Slovenia. As per the terms of the Agreement, Ascent issued 150,903,958 new Ordinary Shares of 0.1p each in the Company to EnQuest. Additionally, at completion, Ascent granted a nil cost option over 29,686,000 new Ordinary Shares of 0.1p each in the Company to EnQuest. The cost of both the share issue and the grant of the nil cost option have been treated as additions to Slovenian exploration costs in the period. 

 

The impairment charge for the period relates to the plugging of the PEN 104AA well at the Penészlek development.

 

8

Trade and other receivables

30 June 2011

 


30 June 2010

 


31 December 2010

 


Group

£ 000's


£ 000's


£ 000's









Trade receivables

309


961


471


VAT recoverable

966


801


867


Other receivables

223


209


203


Prepayments & accrued income

25


54


123










1,523


2,025


1,664















9

Trade and other payables

30 June 2011

 


30 June 2010

 


31 December 2010

 


Group

£ 000's


£ 000's


£ 000's









Trade payables

3,426


2,812


1,655


Tax and social security payable

74


91


92


Other creditors

259


41


148


Accruals and deferred income

611


60


419










4,370


3,004


2,314










10

Borrowings

 

Bank loan

 

The Group has a loan outstanding with Cassa Di Risparmio de Cento Bank. The Loan expires on 5 June 2012.  Interest is calculated by reference to the three month Euribor rate plus a margin of 1%.

 

Convertible loan note

 

On 19 November 2010, the Company secured a one year loan facility of £2.1m with YA Global Master SPV Ltd to contribute to the financing of the Pg-11 evaluation well on the Petišovci-Lovászi project area. The one year loan facility was drawn down following completion of certain conditions precedent, including (inter alia) provision of security over Ascent's interest in its Hungarian subsidiary.  The loan carries an interest rate of 6% per annum, payment of which will be covered from cashflow from Ascent's existing production.  During the term of the facility, Yorkville has the right to convert the outstanding loan balance into shares in Ascent at prices ranging from 8.4p-10.5p. The loan is secured by a charge over Ascent's assets.

 

The bulk of this loan balance was paid off during the period ended 30 June 2011. Subsequent to the period end the remaining balance was fully repaid and the conversion rights have therefore fallen away.

 

11

Events subsequent to the reporting date

 

Issue of Convertible Notes

On 21 July 2011, Ascent placed convertible loan notes with existing Italian creditors to raise €552,525 with an option to issue a further €70,000 of convertible loan notes in the future for additional services.  The proceeds will be used to advance work on the Company's Italian portfolio.

The unsecured loan notes, which carry interest of 8.5% per annum, are convertible into ordinary shares of 0.1p each in the Company ('Ordinary Shares') at a conversion price of 12 pence per Ordinary Share on or before the 31 December 2013, reflecting a premium to the closing share price on 20 July 2010 of approx. 310%.  The loan notes may be repaid for their principal value plus any outstanding interest at any time by the Company.

 

 


This information is provided by RNS
The company news service from the London Stock Exchange
 
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