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#MSMN Mosman Oil & Gas – Stanley-5 well update

Mosman Oil and Gas Limited (AIM: MSMN) the oil exploration, development, and production company, announces an update on the Stanley-5 well in Polk County, East Texas.

The well is now scheduled to be drilled after the current well at Winters is completed and the rig is relocated the short distance to Stanley-5.

Stanley-5 is a development well targeting the Yegua formation, at approximately 5,000 feet. Following the acquisition of Nadsoilco LLC in July this year, Mosman’s interest in this well will be c36.5%. Mosman will fund its share of the USD 350,000 drilling costs from existing cash resources.

 

John W Barr, Chairman, said: “Mosman is pleased with the current drilling activity that we had planned for this year to achieve the strategic objective of increasing production.”

Qualified Person’s Statement 

The information contained in this announcement has been reviewed and approved by Andy Carroll, Technical Director for Mosman, who has over 35 years of relevant experience in the oil industry. Mr. Carroll is a member of the Society of Petroleum Engineers.

 

Market Abuse Regulation (MAR) Disclosure

The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014 (‘MAR’) which has been incorporated into UK law by the European Union (Withdrawal) Act 2018. Upon the publication of this announcement via Regulatory Information Service (‘RIS’), this inside is now considered to be in the public domain.

Enquiries:

Mosman Oil & Gas Limited 

John W Barr, Executive Chairman Andy Carroll, Technical Director

jwbarr@mosmanoilandgas.com acarroll@mosmanoilandgas.com

NOMAD and Broker

SP Angel Corporate Finance LLP

Stuart Gledhill / Richard Hail / Adam Cowl

+44 (0) 20 3470 0470

Alma PR

Justine James / Joe Pederzolli

+44 (0) 20 3405 0205

+44 (0) 7525 324431

mosman@almapr.co.uk

Joint Broker

Monecor (London) Ltd trading as ETX Capital Thomas Smith

020 7392 1432

#POW Power Metal Resources – Tati Project Botswana – Drill Programme Commences

 

pow

Power Metal Resources PLC (LON:POW) the London listed exploration company seeking large-scale metal discoveries across its global project portfolio announces that the company’s inaugural drilling programme is now underway on the Tati Project located in the Tati Greenstone Belt near Francistown, Botswana (the “Project”).  The Project is targeting large scale gold and nickel discoveries.

Paul Johnson, Chief Executive Officer of Power Metal Resources plc commented:

“The launch of this inaugural drill programme at the Tati Project in Botswana is a great step forward for the Company.  The stunning pace of ground exploration at the Project has been matched by the positive findings to date and notably several multi-kilometre geochemical anomalies.

Drilling at such an early stage demonstrates our confidence in the Project and our sense of urgency to better understand the geology of several high-priority target areas. With successful exploration, Tati Project could become one of the leading projects in our portfolio.”

 

Highlights:

 

 

Drill Programme

Approximately 1,000m of reverse circulation (“RC”) drilling is planned across multiple target zones which is being undertaken by Power Metal’s drill partners Equity Drilling Ltd and Mindea Exploration and Drilling Services (Pty) Ltd.

All drill holes as part of this programme are planned for depths between 50 – 100m. RC drilling provides a inexpensive, and rapid testing method which is well suited for an early-stage drilling campaign.

The RC chip samples collected will be sent to Intertek Group plc’s laboratory located in Perth, Australia, for Fire Assay and multi-element analysis

 

Exploration to Date

Exploration on the Project has advanced at a rapid pace to its current stage since Power metal exercised its option to acquire a 100% interest in the Project on 28 July 2021.

To date, exciting multiple kilometre-scale arsenic, gold and nickel, as well as magnetic anomalies have been identified by geochemical sampling and ground-based geophysical surveys.

 

 

 

Rationale for Early Drilling

Kalahari sands which blanket the majority of the Project have precluded widespread geological mapping and prospecting, as a result the Company has decided to launch the drilling campaign in order to obtain bedrock RC chip samples from the various target areas below Kalahari sand cover.

The main goal of the drill programme is to test for the presence of the geological formations which host many of nearby historic and currently operating gold and nickel mines within the Tati Greenstone Belt.

The laboratory assay results, combined with geological logging of the RC bedrock samples will provide the company important geological information which will help guide future exploration and drilling campaigns on the Project.

PROJECT BACKGROUND

Power Metal exercised an option to acquire a 100% interest in the Project on 28 July 2021, through its local wholly owned operating subsidiary. Details of the option exercise can be found below.

https://www.londonstockexchange.com/news-article/POW/tati-project-botswana-option-exercised/15075700

PHASE I EXPLORATION

 

A total of 1,107 soil samples and 49 rock samples were collected across five select areas as part of the Phase I programme at the Project which was orginally announced by the Company on 28 June 2021:

https://www.londonstockexchange.com/news-article/POW/tati-project-botswana-exploration-commences/15036117

The first batch of results were analysed utilising a portable field X-ray Fluorescence (“XRF”) spectrometer, and from this work multiple large scale nickel and arsenic soil anomalies were announced by the Company on 19 August 2021:

https://www.londonstockexchange.com/news-article/POW/tati-project-large-scale-anomalies-confirmed/15104018

The second batch of results including 380 soil samples from Grid 1 (or the “Sikukwe Zone”), and 49 rock samples which were analysed by fire assay for gold at Intertek Group plc’s laboratory located in Perth, Australia. The results of this programme were announced by the Company on 14 September 2021:

https://www.londonstockexchange.com/news-article/POW/tati-project-large-scale-gold-anomaly-confirmed/15133545

PHASE II EXPLORATION

The phase II geophysics programme is nearing completion with surveys now finished on Grids 3, 4 and 5. A final survey over the Sikukwe Zone will be completed within the coming days. The preliminary results and findings from this Phase II exploration have been used for the planning of the ongoing RC drilling programme.  Further information in respect of the Phase II programme is available in the Company’s announcement dated 26 August 2021:

 

https://www.londonstockexchange.com/news-article/POW/tati-project-botswana-exploration-update/15112960

 

COMPETENT PERSON STATEMENT

The technical information contained in this disclosure has been read and approved by Mr Nick O’Reilly (MSc, DIC, MIMMM, MAusIMM, FGS), who is a qualified geologist and acts as the Competent Person under the AIM Rules – Note for Mining and Oil & Gas Companies. Mr O’Reilly is a Principal consultant working for Mining Analyst Consulting Ltd which has been retained by Power Metal Resources PLC to provide technical support.

This announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018 (“MAR”), and is disclosed in accordance with the Company’s obligations under Article 17 of MAR.

For further information please visit https://www.powermetalresources.com/ or contact:

Power Metal Resources plc

Paul Johnson (Chief Executive Officer)

+44 (0) 7766 465 617

SP Angel Corporate Finance (Nomad and Joint Broker)

Ewan Leggat/Charlie Bouverat

+44 (0) 20 3470 0470

SI Capital Limited (Joint Broker)

Nick Emerson                                                                                                           

+44 (0) 1483 413 500

First Equity Limited (Joint Broker)

David Cockbill/Jason Robertson

+44 (0) 20 7330 1883

#BRES Blencowe Resources – Corporate Presentation

Blencowe Resources (LSE:BRES) is pleased to announce a new Corporate Presentation has been uploaded on the ‘Investors’ section of the Company’s website (www.blencoweresourcesplc.com), incorporating information on the recently announced and highly positive Preliminary Economic Assessment.

 

For further information please contact:

  Blencowe Resources Plc

Sam Quinn

Investor Relations

Sasha Sethi

www.blencoweresourcesplc.com

Tel: +44 (0)1624 681 250

info@blencoweresourcesplc.com

Tel: +44 (0)7891  677 441

sasha@flowscomm.com

Brandon Hill Capital Limited

Jonathan Evans

Tel: +44 (0)20 3463 5000

jonathan.evans@brandonhillcapital.com

  First Equity Limited     Tel: +44(0)20 7330 1883

 Jason Robertson    jasonrobertson@firstequitylimited.com

#ECHO Echo Energy Plc – Interim Results

Echo Energy, the Latin American focused upstream energy company, announces its unaudited interim results for the six months ended 30 June 2021.

 

H1 2021 Highlights:

· Refocus of capex away from high-risk exploration into lower risk-production opportunities with swift pay back.

· Gross profit of US $0.4 million (H1 2020: loss of US$ 1.6 million).

· Revenue increase of 5% to US $5.9 million in H1 2021 (H1 2020: US $5.6 million).

· Reduction in cost of sales of 33% in H1 2021 compared to equivalent period in H1 2020

· Total net aggregate H1 2021 production of 304,639 boe (including 37,159 bbls of oil and condensate and 1,605 MMscf gas).

· New gas sales contracts in place from May 2021 with premium pricing from innovative price auction.

· Strong domestic gas prices supported enhanced cashflow generation with a 28% increase in gas price compared to same period a year ago with premium gas prices only coming into effect in last two months of the period.

· Successful completion of the restructuring of both the  Company’s EUR 20.0m 8.0% secured notes  and  the Company’s EUR 5.0m 8.0% secured convertible debt facility loan.

· Echo received a successful VAT cash disbursement from the Argentine Government of US $0.5 million, a further signal that the country  is progressing towards more regular activity.

Enquiries:

Echo Energy

Martin Hull, Chief Executive Officer  via Vigo Communications

Vigo Communications (PR Advisor)  +44 (0) 20 7390 0230

Patrick d’Ancona

Chris McMahon

Cenkos Securities (Nominated Adviser)   +44 (0) 20 7397 8900

Ben Jeynes

Katy Birkin

Shore Capital (Corporate Broker)   +44 (0) 20 7408 4090

Jerry Keen

Certain of the information communicated within this announcement is deemed to constitute inside information for the purposes of Article 7 of EU Regulation 596/2014 (as amended), which forms part of domestic UK law pursuant to the European Union (Withdrawal) Act 2018. Upon the publication of this announcement, this inside information is now considered to be in the public domain.

 

Chairman and Chief Executive Officer’s Statement

 

The first six months of 2021 have seen Echo Energy plc (“Echo” or  the “Company”) emerge from the previous year’s challenges both operationally and financially stronger. The Company moved swiftly  to successfully restructure its debt, continue to conserve cashflow, begin to reinstate previously shut in production wells, and refocus its portfolio on progressing cashflow enhancing rapid return production opportunities. We have executed our strategy of moving away from high-risk exploration spend into lower risk-production opportunities with attractive pay back periods.

These important achievements and the improving macro environment combined with our commercial successes, including the renegotiation of gas sale agreements at substantial market premiums during the period, are reflected in an improved financial performance for the period.

As Echo continues its return to full liquids production at Santa Cruz Sur, and improved financial flexibility, we continue to identify and progress growth options across the existing portfolio, and the wider region, and work towards overcoming remaining challenges whilst maintaining our commitment to delivering value for our shareholders.

COVID-19 recovery and progress on production

At the beginning of the 2020 COVID-19 pandemic, extreme volatility in the energy markets resulted in the inability of the Company to sell crude oil and precipitated a decision to preserve cash through the temporary shut in of a significant number of Echo’s oil producing wells. However, following continued improvements in market conditions, including a return to regular oil sales, Echo agreed, together with its Santa Cruz Sur partners, to upgrade and debottleneck the existing liquid pipelines that were previously shut in Q2 2020, as a path to returning to full oil production.

Expenditures of approximately US $0.3 million were injected by the Company to replace and upgrade parts of the Santa Cruz Sur infrastructure and reduce maintenance costs. By June 2021, Echo successfully delivered the project, demonstrating the effectiveness of the Company’s in-country operational capability and enabling production previously shut in in April 2020 to be systematically brought back on line.  A detailed update on liquid production increases was provided to the market in August 2021 with around a 50% increase in liquids production. This has enabled the Company to benefit from the upswing in global oil prices and the improved macro-outlook, symbolising a strong recovery from the challenges of the previous year. Whilst overall production, including gas remains below pre pandemic levels, the company continues to work towards improving production by undertaking the necessary operational activities and investments. With improved economic tailwinds and new infrastructure installed in the field, Echo now has the capacity to commission incremental enhancement projects within its portfolio. The reinvestment of available cashflow to drive further production increases remains an ongoing focus.

These increasing cashflows are expected to enable further production investments to be funded and demonstrate Echo’s commitment to and confidence in its organic growth strategy within the Santa Cruz Sur asset base.

Successful execution of sales contracts at premium prices

In March 2021, Echo secured two new gas sales contracts at significant premiums to both prevailing spot market rates and 2020 contracted rates, with approximately 70% of gross daily gas production from Santa Cruz Sur allocated to industrial customers now committed under secured contracts until April 2022.

Following the Company’s announcement in March 2021 relating to new gas sales contracts for 2021-2022, the Company agreed summer and winter pricing for its annual industrial clients, with the contracted winter premium providing substantially increased cashflow in the near term, helping to grow future operations through production enhancement work activities supported by infrastructure and compressor maintenance programmes.

In Q2, increasing liquids production represented delivery upon the Company’s strategy to leverage the marked upswing in global commodity prices. With the additional liquids production expected to continue to contribute to a material cashflow increase, Echo continues to benefit from an improving domestic market situation. In May 2021, the Company sold gas to the spot market at an average price representing a 151% increase in prices compared to the March 2021 average spot price. All gas production, as of May 2021, was sold under the new gas sales agreements, reflecting significantly increased winter pricing. Any gas volumes not sold under the long-term contracts was sold to the spot market.

Delivery of successful debt restructuring preserving cash resources

In March 2021, Echo undertook a process of restructuring its debt to build a solid financial platform for reinvestment of its increasing cashflows into the Company’s assets to deliver growth. The restructuring was successfully completed in April 2021, when holders of the Company’s publicly listed bonds voted in favour of the restructuring of those securities. As a result, cash interest payments on  the Company’s listed bonds have been deferred until mid-May 2025. The completion of the bond restructuring also fulfilled the remaining condition of the Lombard Odier debt restructuring, which similarly pushed back maturity and preserved cash resources.

 The company’s balance sheet remains highly leveraged, and trade creditor levels are elevated reflecting the challenges presented by the pandemic, but the restructuring, along with the increased oil production following the ongoing infrastructure upgrades, provides a markedly improved and outlook for shareholders.

In May 2021, Echo received a partial VAT repayment from the Argentine Government as it resumed normal activity following months of COVID-19 related shut down. This process provided both material cash funds and further evidence of the normalisation of in-country activities following delays in 2020 caused by COVID-19.

Growth Opportunities

Campo Limite remains a potentially material well  for the Company which could increase reserves and resources in the Palermo Aike concession and open up additional commercial options in the area. Well testing activities remain an operational and commercial focus and work remains ongoing to optimise commercial arrangements to enable activities to resume once pandemic constraints (which were in place throughout H1 2021) are lifted.

At the start of the year, the Company announced a five-year Cooperation Agreement with GTL International S.A, which has interests in both the hydrocarbon and renewables sectors. Both companies continue to collaborate and combine skill-sets to jointly promote their business development initiatives in the wider region, and identify and assess new business development opportunities across the full energy spectrum.

Financial

The six month period ended 30 June 2021 has seen Echo successfully manage value chains, enabling the Company to improve efficiencies at both corporate and asset level.

The Group posted a gross profit of US $0.4 million for the first time since the acquisition of the SCS asset for the six month period ended June 2021 compared to a loss of US $1.6 million for the comparable period in 2020,  attributable to a decrease in cost of sales from US $7.3 million in H1 2020 to US $5.5 million in H1 2021, demonstrating enhanced operational efficiency and commodity prices.

Total revenue for the period was US $5.9 million (H1 2020: US $ 5.6 million), and comprised of US $2.1 million of Oil sales and US $ 3.8 million of Gas sales. Oil prices realised in H1 2021 were on average 21% higher during the period than in H1 2020. Volume weighted average realised gas prices increased by 28% compared to H1 2020.

Financial income of US $3.1 million recognised the interest gained on the Argentine VAT paid to the Group in May 2021 of US $0.24 million and net foreign exchange gains of US $2.9 million. Finance expense of US $ 3.2 million for H1 2021 is on a par with the prior comparable period (H1 2020:  US $ 3.2 million).

Total comprehensive loss for the Group for the 6 month period ending 30 June 2021 was US $1.5 million (H1 2020: US $ 5.7 million)

The Group’s balance sheet and overall financial positioning has materially strengthened during the period due to the successful debt re negotiation of its bonds and debt facility and the reduction in  short term loan liabilities from US $2.3 million at 30 December 2020 to $0.14 million at 30 June 2021.

In January 2021, the Company’s EUR 5.0m 8% secured convertible debt facility maturity date was extended to April 2025, with no furthercash interest payments due until maturity date. In addition, in April 2021, the Company’s Luxembourg listed EUR 20.0m 8% secured bonds were successfully structured, extending the maturity of the notes to May 2025, and removing all cash interest payments prior to maturity date.

The Company’s cash balance as at 30 June 2021 was US $ 0.9 million, a substantial increase from the balance as at 31 December 2020.

A 30% reduction of Trade and other payables from 30 December 2020 to 30 June 2021 is primarily due to the renegotiation of the Bond and debt facilities, but also reduction in joint venture payables.

Post Period End Highlights

The positive market changes seen in H1 2021 continue post period, and coupled with the restructuring completed in H1 2021, enable the Company to operate from a significantly more stable platform.

At the Santa Cruz Sur asset level, successful commissioning of the liquids pipeline enabled the Campo Molino oil field to be brought back online, contributing to an almost 50% increase in total liquids production in August 2021.

The maturation of the Company’s investment in Santa Cruz Sur, and ongoing careful cost management have increased cashflows, enabling development in our producing asset, and release of capital which can be invested into the business to support business growth, maximising value for shareholders.

 

James Parsons            Martin Hull 

Chairman             Chief Executive Officer

Consolidated Statement of Comprehensive Income

Period ended 30 June 2021

 

 

 

Notes

Unaudited

1 January 2021

30 June 2021

US $

Unaudited

1 January 2020

30 June 2020

US $

Year to

31 December 2020

  Audited

US $

Continuing operations

Revenue

3

5,891,413

5,656,740

11,126,520

Cost of sales

4

(5,497,993)

(7,287,234)

(13,437,010)

Gross profit

393,420

(1,630,494)

(2,310,490)

Exploration expenses

(45,807)

(68,554)

(215,512)

Administrative expenses

(1,492,010)

(1,480,136)

(3,240,934)

Impairment of intangible assets

Impairment of property, plant and equipment

Operating loss

(1,537,817)

(3,179,184)

(5,766,936)

Financial income

5

3,140,024

1,847

7,142

Financial expense

6

(3,287,229)

(3,212,440)

(10,174,047)

Derivative financial income

7

17,575

642,678

666,306

Loss before tax

(1,274,027)

(5,747,099)

(15,267,535)

Taxation

8

Loss from continuing operations

(1,274,027)

(5,747,099)

(15,267,535)

Discontinued operations

Profit/(loss) after taxation for the year from discontinued operations

(10,724,108)

Loss for the period

(1,274,027)

(5,747,099)

(25,991,643)

Other comprehensive income:

To be reclassified to profit or loss in subsequent periods (net of tax)

Exchange difference on translating foreign operations

(177,930)

(1,041,995)

Total comprehensive loss for the period

(1,451,957)

(5,747,099)

(27,033,578)

Loss attributable to: Owners of the parent

(1,451,957)

(5,747,099)

(27,033,598)

Total comprehensive loss attributable to: Owners of the parent

(1,451,957)

(5,747,099

(27,033,598)

Loss per share (cents)

9

Basic

(0.10)

(0.81)

(3.38)

Diluted

(0.10)

(0.81)

(3.38)

Loss per share (cents) for continuing operations

Basic

(0.10)

(0.81)

(1.99)

Diluted

(0.10)

(0.81)

(1.99)

The notes included below form an integral part of these financial statements.

Consolidated Statement of Financial Position

Period ended 30 June 2021

 

 

 

Notes

Unaudited

1 January 2021

30 June 2021

US $

Unaudited

1 January 2020

30 June 2020

US $

Year to

31 December 2020

Audited

US $

Non-current assets

  Property, plant and equipment

10

2,516,805

986,283

2,552,693

  Other intangibles

11

7,773,210

20,725,894

8,511,622

10,290,015

21,712,177

11,064,315

Current Assets

  Inventories

438,014

610,522

541,230

  Other receivables

5,846,670

7,688,813

7,229,263

  Cash and cash equivalents

12

945,488

1,164,408

682,159

7,230,172

9,463,743

8,452,652

Current Liabilities

  Trade and other payables

(10,075,368)

(8,253,260)

(13,249,146)

  Derivatives and other liabilities

(44,885)

(86,105)

(62,477)

(10,120,253)

(8,339,365)

(13,311,623)

Net current assets

(2,890,081)

1,124,378

(4,858,970)

Total assets less current liabilities

7,399,934

22,836,555

6,205,345

Non-current liabilities

  Loans due in over one year

15

(28,162,903)

(24,229,005)

(27,276,015)

  Provisions

(2,959,976)

(2,969,400)

(2,979,956)

(31,122,879)

(27,198,405)

(30,255,971)

Total Liabilities

(41,243,132)

(35,537,770)

(43,567,597)

Net Assets

(23,722,945)

(4,361,850)

(24,050,627)

Equity attributable to equity holders of the parent

  Share capital

13

7,135,082

5,190,877

6,288,019

  Share premium

14

64,748,942

64,817,662

64,961,905

  Warrant reserve

12,188,032

11,153,396

  11,373,966

  Share option reserve

1,570,827

1,358,132

1,412,285

  Foreign currency translation reserve

(3,141,836)

(2,277,812)

(3,319,797)

  Retained earnings

(106,223,992)

(84,604,105)

  (104,772,035)

Total Equity

(23,722,945)

(4,361,850)

  (24,050,627)

The notes included below form an integral part of these financial statements.

Consolidated Statement of Changes in Equity

Period ended 30 June 2021

 

 

Retained earnings

US $

 

 

Share capital

US $

 

 

Share

premium

US $

 

 

Warrant reserve

US $

 

Share option

reserve

US $

Foreign currency translation reserve

US $

 

 

 

Total equity

US $

1 January 2021

(104,772,035)

6,288,019

64,961,905

11,373,966

1,417,285

(3,319,767)

(24,050,627)

Loss for the period

(1,274,027)

(1,274,027)

Exchange Reserve

(177,930)

177,930

Total comprehensive loss for the period

(1,451,957)

177,930

(1,274,027)

Warrants issued

(814,066)

814,066

Warrants exercised

274,803

86,122

360,925

Share issue

572,260

595,153

1,167,413

Transaction costs

(80,171)

(80,171)

Share options lapsed

Share-based payments

153,542

153,542

30 June 2021

(106,223,992)

7,135,082

64,748,943

12,188,032

1,570,827

(3,141,837)

23,722,925

1 January 2020

(78,857,006)

5,190,877

64,817,662

11,142,290

1,159,580

(2,277,812)

1,175,591

Loss for the period

(5,747,099)

(5,747,099)

Exchange Reserve

Total comprehensive loss for the period

(84,604,105)

5,190,877

64,817,662

11,142,290

1,159,580

(2,277,812)

(4,571,508)

Warrants issued

11,106

11,106

Share options lapsed

Share-based payments

198,552

198,552

30 June 2020

(84,604,105)

5,190,877

64,817,662

11,153,396

1,358,132

(2,277,812)

(4,361,850)

1 January 2020

(78,857,006)

5,190,877

64,817,662

11,142,290

1,159,580

(2,277,812)

1,175,591

Loss for the year

(15,267,535)

(15,267,535)

Discontinued operations

(3,441,230)

(10,724,108)

Exchange Reserve

(1,041,995)

(1,041,955)

Total comprehensive loss for the year

(25,991,643)

(1,041,955)

(13,472,062)

New shares issued

1,0971,142

467,735

1,565,077

Warrants

(231,676)

231,676

Share issue costs

(92,016)

(92,016)

Share options lapsed

396,935

(76,614)

Share-based payments

334,319

334,319

31 December 2020

(104,772,035)

6,288,019

64,961,906

11,373,966

1,417,285

(3,319.767)

(24,050,627)

The notes included below form an integral part of these financial statements.

Consolidated Statement of Cash Flows

Period ended 30 June 2021

Unaudited

1 January 2021

30 June 2021

US $

Unaudited

1 January 2020

30 June 2020

US $

 

Year to

31 December 2020

US $

Cash flows from operating activities

Loss from continuing operations

(1,274,027)

(5,747,099)

 

(15,267,535)

Loss from discontinued operations

(10,724,108)

(1,274,027)

(5,747,099)

(25,991,643)

Adjustments for:

Depreciation and depletion of property, plant and equipment

35,887

102,442

182,211

Depreciation and depletion of intangible assets

738,412

982,102

1,874,810

 (Gain)/Loss on disposal of property, plant and equipment

10,822

(Gain)/Loss on disposal on Right of use

(66,473)

  Impairment of intangible assets and goodwill

  Impairment of intangible assets and goodwill

  –

 –

10,383,461

  Share-based payments

153,542

209,658

334,319

  Right to use liability

(64,180)

  Financial income

(3,140,024)

(1,845)

(7,142)

  Financial expense

3,287,229

728,821

10,174,047

  Exchange difference

(1,656,272)

(2,265,180)

  Derivative financial gain

(17,575)

(642,678)

(666,306)

  (598,801)

  1,312,027

19,956,865

(Increase) in inventory

103,215

(191,382)

(120,386)

Decrease/(Increase) in other receivables

1,700,723

988,467

311,275

(Decrease)/increase in trade and other payables

(1,020,415)

3,354,669

5,844,002

Cash used in operations

783,523

5,463,781

(6,034,891)

Net cash used in operating activities

(1,089,305)

(283,318)

112

Cash flows from investing activities

Purchase of intangible assets

(248,092)

(470,637)

Purchase of property, plant and equipment

(1,644,516)

Net cash used in investing activities

(248,092)

(2,115,153)

Cash flows from financing activities

Interest received

166,820

1,845

7,142

Interest paid

(208,900)

(1,746)

Bank Fees and other finance cost

(63,136)

(185,520)

Repayment of right of use liability

(2,293)

Issue of share capital

1,167,413

1,565,077

Share issue costs

(80,171)

(92,016)

Proceeds from Warrant exercise

360,925

Net cash from financing activities

1,342,951

(2,194)

1,290,682

Net (decrease)/increase in cash and cash equivalents

253,646

(533,604)

(824,360)

Cash and cash equivalents at the beginning of the period

682,159

1,698,012

1,698,012

Foreign Excahnge gains(losses) on cash and cash equivalents

9,683

  –

(191,439)

Cash and cash equivalents at the end of the period

945,488

  1,164,408

682,159

The notes included below form an integral part of these financial statements.

 

Notes to the Financial Statements

Period ended 30 June 2021

 

1. Accounting Policies 

General Information 

These financial statements are for Echo Energy plc (“the Company”) and subsidiary undertakings (“the Group”). The Company is registered, and domiciled, in England and Wales and incorporated under the Companies Act 2006.

Basis of Preparation

The condensed and consolidated interim financial statements for the period from 1 January 2021 to 30 June 2021 have been prepared in accordance with International Accounting Standards (“IAS”) 34 Interim Financial Reporting, and on the going concern basis. They are in accordance with the accounting policies set out in the statutory accounts for the year ended 31 December 2020 and are expected to be applied for the year ended 31 December 2021.

The comparatives shown are for the period 1 January 2020 to 30 June 2021, and 31 December 2020 and do not constitute statutory accounts, as defined in section 435 of the Companies Act 2006, but are based on the statutory financial statements for the year ended 31 December 2020.

A copy of the Company’s statutory accounts for the year ended 31 December 2020 has been delivered to the Registrar of Companies; the accounts are available to download from the Company website at www.echoenergyplc.com.

Going Concern

The Group’s business activities, together with the factors likely to affect its future development, performance and position are set out in the Chairman and Chief Executive Officer’s Statement  above. The financial position of the Group, its cash flows and liquidity position are set out in these Condensed Interim Financial Statements.

The directors have performed a robust assessment, including consideration of the principal risks faced by the Group and taking into account the ongoing impact of the global Covid-19 pandemic on the macroeconomic situation and any potential impact to operations.

The financial information has been prepared assuming the Group will continue as a going concern. Under the going concern assumption, an entity is ordinarily viewed as continuing in business for the foreseeable future with neither the intention nor the necessity of liquidation, ceasing trading or seeking protection from creditors pursuant to laws or regulations. Whilst rigorously pursuing cost control and value maximising strategies, the Group recognises that in order to pursue organic and inorganic growth opportunities and fund on-going operations it will require additional funding. This funding may be sourced through debt finance, joint venture equity or share issues.

The directors have formed a judgement based on Echo’s proven success in raising capital and a review of the strategic options available to the Group, that the going concern basis should be adopted in preparing the Condensed Interim Consolidated Financial Statements.

Estimates

The preparation of the interim financial information requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expense. Actual results may differ from these estimates.

In preparing this condensed interim financial information, the significant judgements made by management in applying the Group’s accounting policies and the key sources of estimation uncertainty were the same as those applied to consolidated financial statements for the year ended 31 December 2020. The key sources of uncertainty in estimates that have a significant risk of causing material adjustment to the carrying amounts of assets and liabilities, within the next financial year, are the Group’s going concern assessment.

 

Revenue Recognition

Revenue comprises the invoice value of goods and services supplied by the Group, net of value added taxes and trade discounts. Revenue is recognised in the case of oil and gas sales when goods are delivered and title has passed to the customer. This generally occurs when the product is physically transferred into a pipeline or vessel. Echo recognised revenue in accordance with IFRS 15. We have a contractual arrangement with our joint venture partner who markets gas and crude oil on our behalf. Gas is transferred via a metred pipeline into the regional gas transportation system, which is part of the national transportation system, control of the gas is transferred at the point at which the gas enters this network, this is the point at which gas revenue is recognised. Gas prices vary from month to month based on seasonal demand from customer segments and production in the market as a whole. Our partner agrees pricing with their portfolio of gas clients based on agreed pricing mechanisms in multiple contracts. Some pricing is regulated by government such as domestic supply. Echo receive a monthly average of gas prices attained. Oil shipments are priced in advance of a cargo and revenue is recognised at the point at which cargoes are loaded onto a shipping vessel at termina

 

2. Business Segments 

The Group has adopted IFRS 8 Operating Segments. Per IFRS 8, operating segments are regularly reviewed and used by the board of directors being the chief operating decision maker for strategic decision-making and resources allocation, in order to allocate resources to the segment and assess its performance.

The Group’s reportable operating segments are as follows:

  a.  Parent Company

                b.  Eastern Austral Basin

                c.           Tapi Aike

                d.            Bolivia

Performance is based on assessing progress made on projects and the management of resources used. Segment assets and liabilities are presented inclusive of inter-segment balances. Reportable segments are based around licence activity, although the reportable segments are reflected in legal entities, certain corporate costs collate data across legal entities and the segmental analysis reflects this.

Information regarding each of the operations of each reportable segment within continuing operations is included in the following table.

 

All revenue, which represents turnover, arises within Argentina and relates to external parties:

 

Parent Company

Santa Cruz Sur

Tapi Aike

Bolivia

Total

US $

US $

US $

US $

US $

Period to 30 June 2021

Revenues

5,891,413

5,891,413

Cost of sales

(5,497,993)

(5,497,993)

Exploration expense

(45,807)

(45,807)

Administration expense

(1,332,349)

(113,839)

(48,928)

(115,043)

(1,610,158)

Impairment of intangible assets

Impairment of property, plant and equipment

Financial income

2,898,300

77,101

164,616

3,140,024

Financial expense

(1,823,398)

(898,236)

(467,375)

(61)

(3,186,081)

Derivative Financial Expense

17,592

17,575

Income tax

Loss before tax

(285,662)

(541,554)

(351,687)

(115,104)

(1,262,545)

Non-current assets

28,792,797

4,740,757

3,362,308

(453,174)

36,442,688

Assets

28,940,599

9,214,984

5,947,869

(413,628)

43,689,824

Liabilities

(28,816,764)

(7,943,328)

(4,421,895)

(81,125)

(41,263,112)

 

 

 

Parent Company

US $

 

Santa Cruz Sur

US $

 

 

Tapi Aike

US $

 

 

Bolivia

US $

 

 

Consolidation

US $

 

 

Total

US $

Period to 30 June 2020

Revenues

5,656,740

5,656,740

Cost of sales

(7,656,740)

(7,287,740)

Exploration expense

  (68,554)

(68,554)

Administration expense

(1,300,419)

(120,701)

56,538

(115,554)

(1,480,136)

Impairment of intangible assets

Impairment of property, plant and equipment

Financial income

  1,847

1,847

Financial expense

(2,340,434)

(872,069)

(1,015)

1,078

(3,212.440)

~Depreciation

  642,678

642.678

Income tax

Loss before tax

(3,064,882)

(2,632,263)

55,523

(114,476)

(5,747,099)

Non-current assets

35,265,014

6,822,530

5,935,643

(271,171)

(26,032,839)

21,712,177

Assets

  45,181,992

  (12,916,982)

(656,675)

(240,370)

(26,026,010)

31,175,919

Liabilities

(23,073,545)

  (12,406,577)

(2,314)

(49,335)

(35,537,770)

 

Consolidation adjustments in respect of assets relate to the impairment of intercompany assets .

~Depreciation is included in administration expenses

The geographical split of non-current assets arises as follows:

 

United

Kingdom

US $

 

South America

US $

 

Total

US $

30 June 2021

Property, plant and equipment

2,457

2,514,348

2,516,805

Other intangible assets

326,869

7,446,341

7,773,210

30 June 2020

Property, plant and equipment

19,025

967,258

986,283

Other intangible assets

20,725,894

20,725,894

 

 

3. Revenue

Unaudited

1 January 2021 –

30 June 2021

US $

Unaudited

1 January 2020 –

30 June 2020

US $

Year to

31 December 2020

Audited -Continued operations  US $

Oil revenue

2,024,421

2,090,922

2,784,248

Gas revenue

Other Income

3,833,857

33,135

3,565,818

8,279,416

62,856

Total Revenue

5,891,413

5,656,740

11,126,520

4. Cost of Sales

Unaudited

1 January 2021 –

30 June 2021

US $

Unaudited

1 January 2020 –

30 June 2020

US $

Year to

31 December 2020

 

US $

Production costs

3,794,486

5,723,033

10,021,578

Selling and distribution costs

863,065

764,918

1,567,963

Movement in stock of crude oil

72,239

(191,382)

(89,410)

Depletion

768,203

990,665

1,936,879

Total Costs

7,287,234

13,437,010

5. Finance Income

Period to

30 June 2021

US $

Period to

30 June 2020

US$

Year to

31 December 2020

US $

Interest income

241,716

1,847

7,142

Net foreign exchange gains

2,898,308

Total

3,140,024

1,847

  7,142

The Interest income principally relates to interest gained on Argentine VAT balances owed and paid to the Group in May 2021.

 6. Financial Expense

Period to

30 June 2021

US $

Period to

30 June 2020

US$

Year to

31 December 2020

US $

Interest payable

1,299,079

1,191,065

1,991,535

Unwinding of discount on long term loan

404,081

1,131,249

2,936,831

Amortisation of loan fees

119,526

150,199

614,913

Warrant Valuation expense

11,106

  –

Accretion of right of use liabilities

2,293

2,293

Unwinding of abandonment provision

19,980

39,956

Finance cost of holding bonds

11,971

Foreign Exchange Losses

1,242,035

660,018

4,409,732

Bank fees and overseas transaction taxes

202,528

66,510

166,816

Total

3,287,229

3,212,440

10,174,047

 

7.Derivative Financial Gain/Loss

Period to

30 June 2021

US $

Period to

30 June 2020

US $

Year to

31 December 2021

US $

Fair value gain

17,575

642,678

666, 306

Total

17,575

642,678

666, 306

Represents fair value gain on valuation of derivatives instruments at period end.

 

8.Taxation

The Group has tax losses available to be carried forward in certain subsidiaries and the parent company. Due to uncertainty around timing of the Group’s projects, management have not considered it appropriate to anticipate an asset value for them. No tax charge has arisen during the six month period to 30 June 2021, or in the six months period to June 2020, or the year to 31 December 2020. 

 

9. Loss Per Share

The calculation of basic and diluted loss per share at 30 June 2021 was based on the loss attributable to ordinary shareholders. The weighted average number of ordinary shares outstanding during the period ending 30 June 2021 and the effect of the potentially dilutive ordinary shares to be issued are shown below.

 

Period to

30 June 2021

Period to

30 June 2020

Year to

31 December 2020

Net loss for the year (US $)

(1,294,027)

(5,747,099)

(25,991,664)

Basic weighted average ordinary shares in issue during the year

1,236,231,219

711,717,587

768,598,277

Diluted weighted average ordinary shares in issue during the year

1,236,231,219

711,717,587

768,598,277

Loss per share (cents)

Basic

(0.10)

(0.81)

(3.38)

Diluted

(0.10)

(0.81)

(3.38)

 

In accordance with IAS 33 and as the entity is loss making, including potentially dilutive share options in the calculation would be anti-dilutive. Deferred shares have been excluded from the calculation of loss per share due to their nature.

 

 

10. Property, Plant and Equipment

PPE – O&G

Properties

US $

CDL Licence Areas Discontinued

US $

 

Fixtures & Fittings

US $

Property Right-of-Use

Assets

US $

 

 

Total

US $

30 JUNE 2021

Cost

1 January 2021

2,621,921

97,254

2,719,175

Additions

Disposals

30 June 2021

2,621,921

97,254

2,719,175

Depreciation

1 January 2020

79,941

86,542

166,483

Charge for the period

29,790

6,097

35,887

Disposals

30 June 2021

109,731

92,639

202,370

Carrying amount

30 June 2021

2,512,190

4,615

2,516,805

30 JUNE 2020

Cost

1 January 2020

979,164

131,122

309,804

1,420,090

Additions

35

35

Disposals

(33,923)

(309,804)

(343,727)

30 June 2020

979,164

97,234

1,076,398

Depreciation

1 January 2019

3,338

91,366

224,176

318,880

Charge for the period

8,568

19,828

74,046

102,442

Disposals

(32,985)

(298,222)

(331,207)

30 June 2020

11,906

78,209

90,115

Carrying amount

30 June 2020

967,258

19,025

986,283

 

 

 

31 DECEMBER 2020

Cost

1 January 2020

  979,164

  –

131,122

309,804

  1,420,090

Additions

1,644,460

56

  1,644,516

Disposals

(1,703)

(33,923)

(309,804)

(345,430)

31 December 2020

2,621,921

97,255

2,719,176

Depreciation

1 January 2020

3,338

91,366

224,176

318,880

Exchange differences

Charge for the year

76,603

19,980

85,628

182,211

Impairment charge

Disposals

(24,804)

(309,804)

(334,608)

31 December 2020

79,941

86,542

  166,483

Carrying amount

31 December 2020

2,541,980

10,713

2,552,693

31 December 2019

975,826

39,756

85,628

1,101,210

 

11. Other Intangible Assets 

Exploration and Evaluation

Argentina

Exploration & Evaluation

US $

 

CDL Licence Areas Discontinued

US $

  Ksar Hadada

Exploration Acreage

US $

 

 

Total

US $

30 June 2021

Cost

1 January 2021

10,756,306

10,756,306

Disposals

Decommissioning assets

Additions

30 June 2021

10.756,306

10,756,306

Impairment

1 January 2020

2,244,684

2,244,684

Depletion

415,912

415,912

Depreciation decommissioning assets

322,500

322,500

Impairment charge for the period

30 June 2021

2,983,096

2,983,096

Carrying amount

30 June 2021

7,773,210

7,773,210

31 December 2020

8,511,622

8,511,622

30 JUNE 2020

Cost

1 January 2020

20,943,460

20,943,460

Discontinued operations

29,401

29,401

Additions

1,105,009

1,105,009

Transfer to PP&E

30 June 2020

22,077,870

22,077,870

Impairment

1 January 2020

369,874

369,874

Discontinued operations

982,102

982,102

Impairment charge for the period

30 June 2020

1,351,976

1,351,976

Carrying amount

30 June 2020

20,725,894

20,725,894

31 DECEMBER 2020

20,573,587

20,573,587

Cost

1 January 2020

10,802,524

10,140,936

20,943,460

Additions

228,112

242,525

470,6537

Disposals

(10,383,461)

(10,383,341)

Decommissioning assets

Transfers

(274,330)

(274,330)

31 December 2020

10,756,306

10,756,306

Impairment

1 January 2020

36,874

  –

369,874

Disposals

(10,383,461)

10,383,461)

Depletion

1,874,810

1,874,810

Impairment charge for the year

10,383,461

10,383,461

31 December 2019

2,244,686

2,244,686

Carrying amount

31 December 2020

8,511,622

8,511,622

31 December 2019

20,575,586

20,573,586

On 22 December 2020 the Company announced that it had allowed the lapse of the option to re enter the Tapi aike asset. This resulted in Echo withdrawing its interest and liabilities under the Tapi Aike concessions prior to the drilling of the next exploration well in the Tapi Aike Western Cube.

12.Cash and Cash Equivalents

Six months to

30 June 2021

Six months to

30 June 2020

 

31 December 2020

US $

US $

US $

Cash held by joint venture partners

190,974

194,973

24,749

Cash and cash equivalents

754,514

969,435

654,680

Total

945,488

1,164,408

682,159

Echo has advanced cash to its joint venture partner. The equity share of the balance held is recognised

 

13. Share Capital

Six months to

30 June 2021

Six months to

30 June 2020

Year to

31 December 2020

US $

US $

US $

Issued, Called Up and Fully Paid

1,298,813 0.32¢ (June 2020: 711,717,587 0.32¢) ordinary shares

1 January 2021

6,288,019

5,190,877

5,190,877

Equity shares issued

847,063

745,878

30 June / 31 December

7,135,082

5,190,877

6,288,019

The holders of 0.32c (0.25p) ordinary shares are entitled to receive dividends from time to time and are entitled to one vote per share at meetings of the Company.

 

During the six month period to 30 June 2021, 258,762,165 share were issued.

14. Share Premium Account

Six months to

Six months to

Year to

30 June 2021

US $

30 June 2020

US $

31 December 2020

US $

1 January

64,961,905

64,817,662

68,817,662

Premium arising on issue of equity shares

595,153

467,934

Premium arising on exercise of warrants

86,122

Warrants lapsed or exercised

(814,066)

(231,675)

Transaction costs

(80,171)

(92,016)

30 June

64,748,942

64,817,662

64,961,905

 

 

15. Loans

30 June 2021

US $

30 June 2020

US$

31 December 2020

US $

Five-year secured bonds

Additional net funding

 

 

  (20,907,802)

  (5,940,825)

(18,429,737)

(22,167,419)

(5,766,544)

Other loans

(1,452,341)

(5,799,268)

(1,640,693)

Total

(28,300,968)

(24,229,005)

(29,574,656)

 

 

Balance as at

31 December 2020

US $

Amortised finance charges less cash

interest paid

US $

Repayment of principle

 

US$

 

Exchange

adjustments

US $

 

 

30 June 2021

US$

20 million five-year secured bonds

 

22,836,146

 

1,246,109 

 

 

 

(2,583,675)

 

21,498,580

€5 million Lombard Odier debt

Other loans

5,987,801

1,640,692

311,220

145,831

 

(208,900)

(178,515)

(125,282)

6,120,506

1,452,341

Loan fees

(668,726)

77,948

(590,778)

Incremental loan fees

(221,257)

  41,576

(179,681)

Total

29,574,656

1,822,684

(208,900)

(2,887,472)

28,300,968

US $ 138,065 of the total loan balance is shown in current liabilities and US $28,162,903 is shown non-current liabilities.

Bond restructure

On 22 February 2021, Echo announced further to the Company’s announcement of 1 December 2020, its proposals in respect of a restructuring of the Company’s Bonds, it proposed to:

• Extend the maturity of the Bonds by three years to 15 May 2025 (the “Maturity Date”); and

• Remove all cash interest payments on the Notes prior to the Maturity Date.

On approval, all interest on the Bonds accruing from 31 December 2019 shall be paid in cash on the Maturity Date save that Noteholders will be provided with the ability, from 30 September 2021, to elect to receive Bond interest payments in respect of the immediately preceding quarter in new ordinary Shares in the Company (“Elections”), subject inter alia to the Company having the required share issuance authorities in place from time to time to satisfy elections and to Noteholders holding at least 50 per cent of the Bonds having made Elections in respect of the relevant quarter. Any new ordinary shares issued as a result of elections would be issued at an effective issue price equal to the volume weighted average price of an Echo ordinary share for the 10 Business Days before the relevant interest conversion date.

As part of the Proposals, the Company agreed that it will not, without the prior consent of Noteholders, drill an exploration well with a budgeted cost to the Company of in excess of EUR 5.0 million for so long as the Bonds are outstanding and that it will not, in the last 18 months prior to the Maturity Date, make an acquisition of an interest in an oil and gas property, lease or licence if the cash consideration for such acquisition exceeds EUR 10.0 million.

A payment of EUR 100,000, payable to Bondholders, was satisfied by the issue of new ordinary shares in the Company at an issue price equal to the average mid-market closing price per Echo ordinary share for the five days ending, and including, 18 February 2021.

Subsequently on 30 March 2021, a requisite majority of Bondholders approved the Debt restructuring proposals. Echo issued a total of 11,473,929 new ordinary shares in the Company (representing c.0.9% of the Company’s current issued ordinary share capital) to Bondholders.

16. Subsequent Events

Operational Update

On 26 August 2021, following installation of the pipeline required to bring back online the liquids production which was shut in April 2020, the infrastructure was successfully commissioned for operation and shut-in wells are being brought online.  This follows an upgrade of the electrical infrastructure, which was designed to support the first tranche of production from the Campo Molino and Chorillos oil fields to provide sufficient power to support sustained production from the associated ten wells.

To date, the Campo Molino oil field has been brought back online with four of the shut-in wells now back in operation and producing from the Springhill reservoir. This first tranche of restored production will increase the number of active producing oil wells at Santa Cruz Sur to 18.

As of 23 August 2021, the recently reactivated wells have contributed to an almost 50% increase in total liquids production at Santa Cruz Sur compared to the period immediately prior to this (281 bopd gross, 197 bopd net to Echo – during the period 1 -17 August 2021). This represents an increase of 137 bopd gross, 95 bopd net to Echo and work continues to bring the remainder of the first tranche of shut-in production back online. The production levels from the initial reactivated wells indicate that the shut-in period has not had a detrimental impact on reservoir behaviour in the Campo Molino oil field. Prior to shut-in, the combined gross production from the ten oil wells was approximately 138 bopd gross, 96 bopd net to Echo, approximately the same level now being achieved from the initial four wells, with the associated upgraded infrastructure.

#KAV Kavango Resources – Interim Results

kav

Kavango Resources plc, an exploration company targeting the discovery of world class mineral deposits in Botswana, is pleased to announce its unaudited financial results for the six months ended 30 June 2021.

 

SUMMARY

· Issue of 69,776,784 ordinary shares (Note 5)

· Expenditure in Botswana on exploration of US$512,000 (Note 4)

· Operating loss of US$776,000 (2020 – US$254,000)

 

The Chairman’s Statement and Interim Results are set out in the following pages.

 

Contacts

Kavango Resources plc

Ben Turney

+46 7697 406 06

bturney@kavangoresources.com  

First Equity

Jason Robertson

+44 207 374 2212

SI Capital Limited (Broker)

Nick Emerson/Alan Gunn

+44 1483 413500

 

INTERIM MANAGEMENT REPORT 30 JUNE 2021

 

We’ve taken great strides during the first half of 2021 to realise our ambition of becoming one of Botswana’s leading minerals exploration companies.

Having raised £2million in a placing in November 2020 through our joint brokers, First Equity Ltd and SI Capital Ltd, Kavango entered 2021 in good financial shape.

On 11 January 2021, I joined the board as Non-Executive Chairman together with Ben Turney, who joined as Executive Director. Ben subsequently became CEO on 22 June 2021. I would like to thank our former CEO Michael Foster for the role he played in bringing Kavango to market and guiding the Company through its start-up phase. Michael remains as a Non-Executive Director.

I am pleased to report that Ben and I have quickly developed an effective working relationship. I have been impressed at the dynamic leadership he has injected into the business at all levels, from building strong commercial relationships and raising money to coordinating our investor relations, improving our operations and recruiting key personnel. Based on our experience so far, I believe that we have complementary skills that bring the right balance to Kavango’s board.

The first six months of 2021 have essentially been a period of transition for the Company, as it moves from its start-up phase to a fully operational enterprise, and while there have inevitably been growing pains, I am confident (particularly following recent senior appointments in Botswana after the period end, as announced on 22 September 2021) we are continuing to build the right leadership team in place to maximise Kavango’s chances of future success. We continue to look to identify the right individuals, at all levels of the group, who can help us grow the group, deliver value to our shareholders and play a positive and responsible role in the wider communities in which we operate.

Before reviewing our operations, I would also like to take the opportunity to thank Mike Moles and Hillary Gumbo for all they have done for Kavango. As the Company’s co-founders, it was their original vision that brought us all here. Their technical expertise and knowledge are a significant boon to Kavango. In a long overdue move, Hillary joined the Kavango board on 28 May.

Operationally, Kavango has accelerated exploration across all three of its project areas.

In the Kalahari Suture Zone (“KSZ”), we are pioneering the deployment of modern remote sensing technology in our search for large-scale copper, nickel and platinum group element deposits. Specifically, we have sought to develop a geophysics-led exploration method that combines Airborne Electromagnetic (“AEM”) surveys, with ground-based Time Domain Electromagnetic (“TDEM”) surveys and other surveying methods. The goal was to identify priority targets, which we could then test with drilling to attempt to confirm the KSZ’s potential as a system to host large-scale nickel, copper and platinum group element deposits.

To this end, on 20 April 2021, we secured a strategic partnership with Spectral Geophysics (“Spectral”), one of southern Africa’s leading experts in the deployment of geophysical surveying. Cas Lotter, Spectral’s CEO, has been an excellent partner to Kavango. We have benefitted a great deal both from the technology he can put into the field as well as the deep level of his experience and understanding of conducting exploration under the Kalahari Sands. We are looking forward to Cas and his team continuing to play a significant role in our work in the KSZ.

Following identification of the first TDEM targets, we moved quickly to organise our first drill campaign since 2019. We appointed Mindea Exploration and Drilling Services (Pty) (“Mindea”), a company operated under the Botswana Citizen Economic Empowerment Policy, to conduct the drill campaign on Kavango’s behalf. Mindea was set up by Equity Drilling Limited, which remains a 49% shareholder in Mindea. Ben has been developing a strong working relationship with Equity Drilling/Mindea and commercial discussions are ongoing about the establishment of a strategic drilling joint venture.

Drilling in the KSZ is a significant engineering challenge. A number of historic exploration holes were forced to stop early because of poor ground conditions. We have been extremely fortunate to have a partner as technically skilled as Mindea/Equity Drilling. Maintaining a borehole’s integrity through Kalahari sands and loose sediments is difficult. The fact that, as of writing, Kavango has successfully drilled two deep holes into the KSZ is a major achievement for a company of our size, and we are pleased to acknowledge the expertise of Mindea/Equity Drilling in this regard.

A great deal of testing remains to be done on the drill core, but we now expect the data gathered from our first two holes in the KSZ will guide our future exploration strategy in the region. Our geologists are particularly heartened by what they have seen in their visual inspections of core from the Proterozoic gabbros. The prospectivity of the Proterozoic has long been recognised, but we intercepted it at what we believe are the shallowest depths ever encountered in the northern (Hukuntsi) section. Now, with two distinct exploration horizons to go for (Karoo and Proterozoic), it feels like we may be making tangible progress in unlocking this region’s potential.

Although much of our operational focus has been on the KSZ, we have also continued to make progress in the Kalahari Copper Belt (“KCB”). Here we have two Joint Ventures; one with Power Metal Resources PLC (LSE: POW) and one with Botswana-based LVR GeoExplorers (Pty) Ltd.

Unlike in the KSZ, where Kavango is pioneering modern exploration techniques, in the KCB the exploration model is much more tried and tested.

In February we flew Airborne Electromagnetic (“AEM”) surveys over both JV target areas. AEM surveys have been one of the most successful exploration methods used in the KCB. We were pleased to report the results of these surveys in March and to have identified well-defined targets for further exploration, which were coincidental with the regional geology.

Also, in March we announced a significant increase to our land holding in the KCB in the Power Metal JV (which is called Kanye Resources), through the acquisition of 8 new prospecting licences (“PLs”). We completed the acquisition of these PLs in early August. 

Meanwhile, Kavango has continued work on the ground across its licence areas in the KCB. The Company has commissioned an independent evaluation programme of the company’s soil sampling surveys, with the aim of refining and maximising its methodology.

We are also currently waiting for the government approval of our KCB Environmental Management Plan, which is a prerequisite to be able to undertake drilling in the districts of Botswana that host our principal exploration prospects. We expect this should be awarded in early Q4 of this year.

Finally, at our rare earth elements project at Ditau, which forms part of the Kanye Resources JV with POW, we have continued our exploration work. At the start of January, we initiated orientation work using geophysical and geochemical surveys, which culminated with an announcement in early July that we had identified a number of drill targets. Ditau is covered by our KSZ EMP, and we expect to undertake limited drilling here later in 2021.

 

Responsibility Statement

 

We confirm that to the best of our knowledge:

 

–  The Interim Report has been prepared in accordance with International Accounting Standards 34, Interim Financial Reporting, as endorsed for use in the United Kingdom;

–  Gives a true and fair value of the assets, liabilities, financial position and Loss of the Group;

–  The Interim Report includes a fair review of the information required by DTR 4.2.7R of the Disclosure and Transparency Rules, being an indication of important events that have occurred during the first six months of the financial year and their impact on the set of interim financial statements; and a description of the principal risks and uncertainties for the remaining six months of the year and

–  The Interim Report includes a fair review of the information required by DTR 4.2.8R of the Disclosure and Transparency Rules, being the information required on related party transactions.

 

The Interim Report was approved by the Board of Directors and the above responsibility statement was signed on its behalf by

 

David Smith, Chairman

30 September 2021

 

Forward looking statement

 

Certain statements in this announcement, are, or may be deemed to be, forward looking statements. Forward looking statements are identified by their use of terms and phrases such as ”believe”, ”could”, “should” ”envisage”, ”estimate”, ”intend”, ”may”, ”plan”, ”will” or the negative of those, variations or comparable expressions, including references to assumptions. These forward-looking statements are not based on historical facts but rather on the Directors’ current expectations and assumptions regarding the Company’s future growth, results of operations, performance, future capital and other expenditures (including the amount, nature and sources of funding thereof), competitive advantages, business prospects and opportunities.

 

Such forward looking statements reflect the Directors’ current beliefs and assumptions and are based on information currently available to the Directors. A number of factors could cause actual results to differ materially from the results discussed in the forward-looking statements including risks associated with vulnerability to general economic and business conditions, competition, environmental and other regulatory changes, actions by governmental authorities, the availability of capital markets, reliance on key personnel, uninsured and underinsured losses and other factors, many of which are beyond the control of the Company. Although any forward-looking statements contained in this announcement are based upon what the Directors believe to be reasonable assumptions, the Company cannot assure investors that actual results will be consistent with such forward looking statements.

 

CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

Group Statement of Comprehensive Income for the Interim Period Ended 30 June 2021

Notes

Administrative expenses

Prospectus costs

Other losses

Operating loss

Net finance costs

Loss before tax

Income tax expense

Loss for the period from continuing operations

Other comprehensive income / (expense)

Items that may be reclassified subsequently to profit or loss:

Currency translation differences

Other comprehensive income / (expense) for the period, net of tax

Total comprehensive expenses for the period

Loss per share from continuing and discontinued operations

attributable to the owners of the parent during the period

(expressed in dollars per share)

– Basic and diluted

3

 

 

Group Statement of Financial Position as at 30 June 2021

 

 

Notes

ASSETS

Non-current assets

 

 

 

 

 

 

 

Property, plant & equipment

Intangible assets

Investment in joint ventures

Financial assets

Total non-current assets

Current assets

Trade and other receivables

Financial assets

Cash & cash equivalents

Total current assets

TOTAL ASSETS

LIABILITIES

Current liabilities

Convertible loan note

Trade and other payables 

TOTAL LIABILITIES

NET ASSETS

SHAREHOLDERS’ EQUITY

Share capital

5

Share premium

Share option reserve

Warrant reserve

Reorganisation reserve

Foreign exchange reserve

Retained earnings

TOTAL EQUITY

 

Group Statement of Changes in Equity for the Interim Period Ended 30 June 2021

At 01 January 2020

Loss for the period

Total other comprehensive expenses

Total comprehensive expense for the period

Issue of ordinary shares

Cost of share issues

Share-based payments

As at 30 June 2020

Balance at 01 July 2020

Loss for the period

Total other comprehensive income

Total comprehensive income for the period

Issue of ordinary shares

Share options granted

Warrants issued

As at 31 December 2020

As at 01 January 2021

Loss for the period

Total other comprehensive income

Total Comprehensive Income for Period

Issue of ordinary shares

Cost of share issues

Share-based payments

As at 30 June 2021

 

 

 

Group Cash Flow Statement for the Interim Period Ended 30 June 2021

Cash flows from operating activities

(Loss) before tax

Adjustments for:

Fair value adjustments

Depreciation

Prospectus costs

Fees settles in shares

Share based payment expense

Forex

Operating loss before changes in working capital

(Increase)/decrease in trade and other receivables

(Decrease)/increase in current liabilities

Net cash used in operating activities

Cash flows used in investing activities

Purchase of property, plant and equipment

Investment in financial assets through P&L

Purchase of intangibles

Proceeds from investment disposals

Net cash used in investing activities

Cash flows from financing activities

Proceeds from issue of share capital, net of issue costs

Convertible loan notes

Net cash inflow from financing activities

Net (decrease)/increase in cash and cash equivalents

Cash and cash equivalents at beginning of period

Cash and cash equivalents at end of period

 

NOTES TO THE INTERIM REPORT FOR SIX MONTHS ENDED 30 JUNE 2021

1.  Basis of preparation

The condensed consolidated interim financial statements have been prepared under the historical cost convention and on a going concern basis and in accordance with International Financial Reporting Standards, International Accounting Standards and IFRIC interpretations endorsed for use in the United Kingdom (“IFRS”).

The condensed consolidated interim financial statements contained in this document do not constitute statutory accounts.  In the opinion of the directors, the condensed consolidated interim financial statements for this period fairly presents the financial position, result of operations and cash flows for this period. 

The Board of Directors approved this Interim Financial Report on 30 September 2021. 

Statement of compliance

The Interim Report includes the consolidated interim financial statements which have been prepared in accordance with International Accounting Standard 34 ‘Interim Financial Reporting’.  The condensed interim financial statements should be read in conjunction with the annual financial statements for the period ended 31 December 2020, which have been prepared in accordance with IFRS endorsed for use in the United Kingdom. 

Accounting policies

The condensed consolidated interim financial statements for the period ended 30 June 2021 have not been audited or reviewed in accordance with the International Standard on Review Engagements 2410 issued by the Auditing Practices Board.  The figures were prepared using applicable accounting policies and practices consistent with those adopted in the statutory annual financial statements for the year ended 31 December 2020. There have been no new accounting policies adopted since 31 December 2020.

Going Concern

The condensed consolidated interim financial statements have been prepared on a going concern basis. Although the Group’s assets are not generating revenue and an operating loss has been reported, the Directors have concluded that the Company has funds to meet its immediate working capital requirements and that during the next 12 months from the date of the interim financial statements the Company will need to raise funds to meet its planned exploration expenditures.

2.  Financial risk management and financial instruments

Risks and uncertainties

The Board continually assesses and monitors the key risks of the business.  The key risks that could affect the Group’s medium-term performance and the factors that mitigate those risks have not substantially changed from those set out in the Group’s 2020 Annual Report and Financial Statements, a copy of which is available from the Group’s website: www.kavangoresources.com.  The key financial risks are market risk (including currency risk), credit risk and liquidity.

3.  Loss per share

The calculation of earnings per share is based on the loss attributable to equity holders divided by the weighted average number of shares in issue during the period.

Net loss after tax

(776)

(254)

(708)

Weighted average number of ordinary shares used in calculating basic loss per share (000’s)

333,580

172,309

192,166

Basic & diluted loss per share (cent)

(0.23)

(0.15)

(0.37)

Any share options would result in a decrease in the earnings per share; they are considered to be anti-dilutive, and as such, a diluted loss per share is not included.

4.  Intangible assets

Group

Evaluation and Exploration Assets – Cost and net book value

At period start

2,082

2,445

2,445

Additions

512

126

331

Transferred to Kanye Resources (Pty) Ltd

 –

(691)

Reclassification

 –

(55)

Translation difference

 3

(322)

52

At period end

 2,597

2,249

2,082

 

The Group’s intangible assets are comprised of Evaluation and Exploration assets in respect of the licences in Botswana.

 

During the period US$512,000 (2020: US$126,000) of exploration expenses were capitalised by the Group.

 

The Directors have undertaken a review to assess whether circumstances exist which could indicate the existence of impairment as follows:

• The Group no longer has title to mineral leases.

• A decision has been taken by the Board to discontinue exploration due to the absence of a commercial level of reserves.

• Sufficient data exists to indicate that the costs incurred will not be fully recovered from future development and participation.

 

The directors have also taken into consideration the content of the Competent Person’s Report which is available at the Group’s website.

 

Following their review, the Directors are of the opinion that no impairment charge is necessary.

5.  Share capital

The authorised share capital of the Company and the called up and fully paid amounts at 30 June 2021 were as follows:

A)  Authorised

   

Unlimited Ordinary shares stated value £ 0.001

 

There were no changes during the period

B)  Called up, allotted, issued and fully paid

As at 1 January 2021

295,291,264

390

Shares issued during the period

69,776,784

96

As at 30 June 2021

365,068,048

486

6.  Post balance sheet events

In July 2021, the company placed 36,363,638 new ordinary shares were issued at a price of 5.5 pence, raising gross funds of US$2,738,000 (£2,000,000). A one-for-one warrant was issued to all placing participants, exercisable at 8.5 pence per shares for a period of two years. Ben Turney and Mike Moles, Directors of the Company, participated in the subscription and also received one-for-one warrants on the same terms as above, subject to certain acceleration clauses.

 

In August 2021, Kanye Resources (joint venture held 50/50 with Power Metal Resources plc), completed the acquisition of the 8 new prospecting licences, representing a significant expansion of Kanye’s exploration footprint in the highly prospective Kalahari Copper Belt.

 

In August 2021, 6,000,000 share options were granted to the senior team in Botswana, 4,500,000 share options were granted to Ben Turney, CEO, and 1,000,000 share options were granted to Hillary Gumbo, Director.

7.  Other matters

The condensed consolidated interim financial statements set out above do not constitute the Group’s statutory accounts for the period ended 31 December 2021 or for earlier periods but are derived from those accounts where applicable.

A copy of these interim financial statements is available on Kavango’s website:

Does EV and battery tech really sound the death knell for Oil and Gas?

Future of Oil and Gas

In an era of rising demand and hype for electric vehicles (EV) and battery technology, commodities and ETFs linked to oil and gas have managed to hold their prices. EV stocks like Tesla and Nio have increased by 71% and 100% respectively in the past year. The price of WTI Crude Oil has also increased by 76%, while prices of micro-cap oil stocks like #ECHO Echo Energy and #MSMN Mosman Oil and Gas have increased by 58% and 13% respectively.

This clearly signifies that even after the rise in demand of EVs, commodities like oil and gas are here to stay in the short and long term.

Consumers are under the impression that they could be in an oil-free world by 2030 and most consumers perceive batteries and electricity as the primary source of energy. However, this is highly unlikely and nothing but a series of myths planted in our brains due to effective marketing.

The International Energy Agency (IEA) that analyses trends in energy industry, released its annual World Energy Outlook in November 2019. It looks at potential energy demand and supply under different scenarios to explore different possible futures. The IEA scenario stated a global increase in energy demand by 24% by 2040 of which, oil and natural gas will supply 64% of the world’s energy needs. In accordance with the Paris Climate Agreement, if based on the Sustainable Development Scenario, the oil and natural gas will still supply 47% of the world’s energy by 2040.

More than 15% of oil demand goes into non-combusted use including petrochemicals which is expected to grow to 20% by 2040. Even if the demand for gasoline and other fuels may hypothetically be on the decline, the petrochemical sector, in contrast, still has room to grow. Some major companies have even pledged some $100bn into the petrochemical industry over the next decade.

Developing countries like India have one of the most aggressive renewable power capacity roll-out programmes worldwide. However, its access to affordable fossil fuels remains a priority for its government because its needs for cheap oil, gas and coal continue to rise to meet energy demand that is forecast to more than double by 2040. India’s petroleum minister Dharmendra Pradhan believes the world’s third-largest oil consumer could be the “golden goose” for crude suppliers as it buys more than 80% of its oil needs from foreign crude purchases.

The graph below demonstrates that the forecasted oil demand for 2040 is higher than present day with non-combusted being the driver to increase the demand. While in the primary energy consumption chart, oil is forecasted to maintain its consumption as a primary source by 2040. Whereas the primary consumption of gas is forecasted to rise.

 

(Financial Review, 2020)

 

Texas Oil Wells

In 2018, companies in the Permian Basin – “an ancient, oil-rich seabed that spans West Texas and South Eastern New Mexico — were producing twice as much oil as they had four years earlier” whilst forecasters expected the production to double again by 2023.

The International Energy Agency (IEA) had also predicted that American oil mostly from the Permian will account for 80% of growth in global supply over the next seven years.

Some small companies already had presence in the Permian Basin before these predictions and report in 2018. In 2017, Mosman Oil & Gas (MSMN) acquired several oil and gas leases comprising the Welch Permian Basin Project for a consideration of $310,000. Although the Welch project contributed to a gross profit of $167,000 in the year ended 30 June 2020, recently Mosman sold this Welch Project for $420,000 receiving a premium of 40% from the sale of the project alone.

Mosman is steadily growing its working interests across a number of projects in Texas, including Stanley, Falcon-1, Winters and Galaxie. These have produced a gross profit of over $500,000 in the 2020 year. Stanley also has a 100% success rate with oil production from four wells drilled to date.

Texas wells are providing high returns to oil companies, and with a growing number of projects and acreage, Mosman is well placed for future growth.

South Argentina Oil Wells

Many companies own wells in Argentina and Latin America as it is considered a region rich in resources with 4% of natural gas reserves and 20% of world oil reserves. They are also often undergoing positive development in macro conditions. A strong demand outlook for energy consumption and economic growth coupled with underdeveloped – but lower cost – onshore plays, makes Latin America a favourable region for companies like Echo Energy (ECHO) to deploy its expertise in support of an exploration-led growth strategy.

For the financial year ended 31 December 2020, Santa Cruz Sur at the south-eastern tip of Argentina helped Echo Energy to increase its revenue fourfold to US $11.1mn. This was also due to Echo securing new gas sales contracts at premium rates to the prevailing spot markets in early Q1 2021.

The increase in revenue drove an significant increase in the Echo Energy (ECHO) stock price by 51% from 55p to 83p between December 2020 and January 2021.

Major and Small Suppliers of Oil and Gas

The difference between the barrels of oil supplied can be huge when major suppliers are compared to the small suppliers. But all that glitters is not gold. High supply and production would require a higher demand to be profitable, if the demand of oil stagnates in the future it will affect the major suppliers before the small suppliers.

The big 10 companies accounted for 28% of global oil production in 2020 as shown below.

When this is compared to small oil producers like Echo Energy and Mosman Oil and Gas,  Echo Energy produced a cumulative of 94,000 barrels of oil in Santa Cruz Sur in South Argentina. While Mosman Oil and Gas produced a gross of 90,000 barrels of oil in the year ended June 2020. Based on available data, the production of Echo and Mosman combined is 0.2% of the global oil demand.

This is effective during times of recession or when the global demand is low as during unprecedented times a major oil supplier to generate profits and work at full capacity would need to sell between 5-12% of oil demand while small suppliers of oil would need to fulfil a negligible percentage of global demand of oil to turn profitable. This is due to high storing and inventory costs for major oil suppliers as well as higher fixed costs due to bigger operations.

Conclusion

Therefore, even though the oil demand is perceived to be lower in the future due to alternative resources, the demand doesn’t seem to be in decline due to oil having uses other than fuel and gas for cars and transportation like non-combusted petrochemicals. Even if the demand for oil is on the decline it would not affect small oil suppliers; as working at full capacity they fulfil just a small percentage of global oil demand and still manage to make hefty profits.

These among many, are the reasons keeping the oil prices buoyant and in the mix, not only for the present day but also for the future.

#BRES Blencowe Resources Plc – Update on Orom-Cross Graphite Project

Blencowe is pleased to deliver an update to the market in regards to work streams progressing on the Company’s flagship Orom-Cross graphite project in Uganda.

Highlights

  • Phase Two drilling program was completed in early August; all samples have been prepped and are in transit to laboratories in Australia for assaying.
  • Blencowe continues to target a revised, upgraded JORC Standard Resource statement in Q4 2021.
  • Preliminary Economic Assessment (“PEA”) for the initial proposed mining operation at Orom-Cross is considerably advanced and should be completed before 30 September 2021 with public release shortly thereafter.
  • Forthcoming PEA to be first full commercial model for entire project and will indicate how valuable the Orom-Cross project is on a global scale.

The Orom-Cross project is now developing into an outstanding graphite project based on the recent project milestones achieved and other factors including:

  • Significant size and scale of the overall deposit will allow substantial future uplifts to production levels to meet anticipated surges in graphite demand;
  • Highest quality 97-98% concentrate verified by leading independent metallurgical test expert, SGS Lakefield in Canada;
  • Low risk location to develop a long-term mining operation, with stable Government in Uganda supportive of the mining industry;
  • Strong community support;
  • Advanced project, with 21-year Mining License already awarded; and
  • Opportunity to develop Orom-Cross into a battery metals market that is forecast to grow considerably over next decade, as lithium-ion batteries become highly sought after to power exponential growth in electric vehicles (EVs). Graphite is a key component of the lithium-ion battery.

Cameron Pearce, Executive Chairman commented:

“The Company has made considerable progress over the past sixteen months since Orom-Cross was acquired and is now about to deliver a first economic model to share with the market. 

We are confident that the PEA will underline the value that has been built to date and outline further upside that Orom-Cross can become a globally significant graphite project due to its scale and mineralogy.

The PEA will also begin the process of allowing investors to assess the project in the context of it’s global peer group and provide a robust framework for us to progress strategic discussions already initiated with a range of parties such as potential offtake agreements and strategic partnerships.  We also look forward to delivering our revised JORC Resource Statement in the fourth quarter of this year.

Following delivery of the PEA we will then seek to progress to a pre-feasibility study (“PFS”) to ensure that we further de-risk the investment decision as we drive towards first production.”

Background to PEA

The completion of the PEA by the end of month comes as a result of a range of key achievements Blencowe has delivered on to date, both in terms of timing and budget, and most specifically the initial JORC Standard Resource statement, the second drilling campaign to further delineate a greater part of these resources to a lower risk category (Indicated and Measured status) and the exceptional metallurgical test results announced in the middle of the year.

The PEA has been built up internally by Blencowe’s management team who have significant experience in this regard, with a stated purpose to be accurate but conservative. However all key numbers within the PEA have been generated via the involvement of third party technical experts to ensure credibility and integrity.

The next step beyond PEA will be for the PFS to commence, which will ultimately be signed off by a third party technical firm.  As part of the PFS Blencowe will be opening dialogue with potential offtake partners on quantity, quality and pricing of end products as available for sale.

 

For further information please contact:

  Blencowe Resources Plc

Sam Quinn

www.blencoweresourcesplc.com

Tel: +44 (0)1624 681 250

info@blencoweresourcesplc.com

 

Investor Relations

Sasha Sethi

Tel: +44 (0) 7891 677 441

sasha@flowcomms.com

 

Brandon Hill Capital Limited

Jonathan Evans

Tel: +44 (0)20 3463 5000

jonathan.evans@brandonhillcapital.com

 

First Equity Limited

Jason Robertson

Tel: +44(0)20 7330 1833

jasonrobertson@firstequitylimited.com

 

 

Twitter https://twitter.com/BlencoweRes

LinkedIn https://www.linkedin.com/company/72382491/admin/

 

Background

Orom-Cross is a potential world class graphite project both by size and end-product quality, with a high component of more valuable larger flakes within the deposit. A 21-year Mining Licence for the project was issued by the Ugandan Government in 2019 following extensive historical work on the deposit and Blencowe is moving into the studies phase shortly as it drives towards first production.

Orom-Cross presents as a large, shallow open-pitable deposit, with a maiden JORC Indicated & Inferred Mineral Resource deposit of 16.3Mt @ 6.0% Total Graphite Content. Development of the resource is expected to benefit from a low strip ratio and free dig operations, thereby ensuring lower operating and capital costs.

#POW Power Metal Resources – Director Dealings

powPower Metal Resources plc (LON:POW) the London listed exploration company seeking large-scale metal discoveries across its global project portfolio announces that today, Paul Johnson, Chief Executive Officer of the Company purchased 500,000 ordinary shares of 0.1 pence each in the Company (“Ordinary Shares”) at a price of 2.1p per Ordinary Share through his Self-Invested Personal Pension (“SIPP”) (£10,500 invested). 

Following the above purchase Mr Johnson has a beneficial interest in a total of 75,000,000 Ordinary Shares, representing approximately 6.02% of the issued share capital of the Company.

 

PDMR Disclosure

The notifications below, made in accordance with the requirements of the EU Market Abuse Regulation, provide further detail on the director’s share dealing.

1

Details of the person discharging managerial responsibilities / person closely associated

a)

Name

1.  Paul Johnson

2

Reason for the notification

a)

Position/status

 

1.  Chief Executive Officer

b)

Initial notification /Amendment

Initial Notification

3

Details of the issuer, emission allowance market participant, auction platform, auctioneer or auction monitor

a)

Name

Power Metal Resources Plc

b)

LEI

213800VNXOUPHTX53686

4

Details of the transaction(s): section to be repeated for (i) each type of instrument; (ii) each type of transaction; (iii) each date; and (iv) each place where transactions have been conducted

a)

Description of the financial instrument, type of instrument

ordinary shares of 0.1p each

Identification code

ISIN: GB00BYWJZ743

b)

Nature of the transaction

1.  Purchase of Shares

c)

Price(s) and volume(s)

Price(s)

Volume(s)

2.1p

500,000

d)

Aggregated information

– Aggregated volume

500,000 

– Price

2.1p

e)

Date of the transaction

17 September 2021

f)

Place of the transaction

XLON

Certain information contained in this announcement would have been deemed inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018 (“MAR”), and is disclosed in accordance with the Company’s obligations under Article 17 of MAR.

 

For further information please visit https://www.powermetalresources.com/ or contact:

Power Metal Resources plc

Paul Johnson (Chief Executive Officer)

+44 (0) 7766 465 617

SP Angel Corporate Finance (Nomad and Joint Broker)

Ewan Leggat/Charlie Bouverat

+44 (0) 20 3470 0470

SI Capital Limited (Joint Broker)

Nick Emerson                                                                                                           

+44 (0) 1483 413 500

First Equity Limited (Joint Broker)

David Cockbill/Jason Robertson

+44 (0) 20 7330 1883

#KAV Kavango Resources – Kalahari Copper Belt – LVR JV Licence renewal

kavKavango Resources plc (LSE:KAV), the exploration company targeting the discovery of world-class mineral deposits in Botswana, is pleased to announce renewal of Prospecting Licences (“PLs”) PL082/2018 and PL083/2018 (the “LVR Project”) in the Kalahari Copper Belt (“KCB”). The LVR Project is held in a Joint Venture between the Company and LVR GeoExplorers (Pty) Ltd (“LVR”). Kavango is currently earning into the LVR Project and has to date acquired a 25% stake.

The LVR Project covers 1,091km2 of prospective ground in the KCB. First drill targets were announced on 03 June 2021. Field exploration is ongoing and a further update is expected in the coming weeks.

Ben Turney, Chief Executive Officer of Kavango Resources, commented:

“The LVR Project is quietly gaining momentum. We think PL082 is particularly interesting. Analysis and fieldwork so far suggest this licence could contain a mirror of Cupric Canyon’s Banana Zone South Limb on the other side of the Ghanzi Ridge. We expect to release descriptive media, illustrating the extent of this project’s potential in the coming weeks.”

About the LVR JV

The LVR JV Agreement between Kavango and LVR GeoExplorers Ltd comprises two PLs totalling 1,091km2. Kavango has the right to acquire a 90% interest in the LVR Project through a staged mechanism over seven years from 2 June 2021. Three stages remaining in the earn-in agreement, which require that Kavango spend up to 27.5million BWP (c.£1.8million) in exploration expenditure to earn its 90% interest.

Stage 1 of the JV was completed on 2 June 2021, meaning Kavango has earned 25% interest in the two PLs.

 

Further information in respect of the Company and its business interests is provided on the Company’s website at www.kavangoresources.com and on Twitter at #KAV.

For additional information please contact:

Kavango Resources plc

Ben Turney

bturney@kavangoresources.com

+46 7697 406 06

First Equity (Joint Broker)

+44 207 374 2212

Jason Robertson 

SI Capital Limited (Joint Broker)

+44 1483 413500

Nick Emerson

#ANA Ananda Developments Plc – Research Facility Construction Update

ana

Ananda, the AQSE-listed medical cannabis company creating UK-based operations to grow and provide carbon neutral, consistent, pharmaceutical quality medical cannabis for the UK and international markets, provides the following update on the construction of its research facility.

Since the Company’s update on 6 September 2021, works have continued on schedule at the medical cannabis research growing facility being developed in the UK by DJT Plants Limited (“DJT Plants”), the Company’s 50% owned subsidiary.

As previously announced the facility footprint has been increased.  To provide further detail to shareholders, it now incorporates:

  • a dedicated growing room for female plants (which produce the resin secreting flowers used for medicinal cannabis)
  • a dedicated growing room for male plants (grown to pollinate the female plants)
  • a dedicated plant nursery
  • a dedicated room for mother plants (to guarantee genetic consistency of each generation of plants)
  • laboratory space (for trimming plants, analysing characteristics and test work)
  • enlarged work rooms

The facility is also being constructed to allow for thorough cleaning and to accommodate appropriate work flows and movement of plants through the work rooms.  These are requirements for Good Manufacturing Practices (“GMP”) certification, which will be applied for in due course.  The facility construction management team (supplied by Ananda’s partner JE Piccaver & Co (Gedney Marsh) Limited (“JEPCO”)) is well versed in all aspects of high plant care standards, as they are required in the salad leaf industry where JEPCO operates as a large-scale speciality grower.  Salad leaves are not cooked before being consumed, so the team is very familiar with the required levels of hygiene, work-flow management and deep cleaning.  JEPCO operates to Red Tractor standards, which were established in 2000 and which have grown to become the UK’s biggest farm and food standards scheme, covering all aspects of food safety, traceability and environmental protection.  JEPCO is also accredited under Global GAP (the Global Partnership for Safe and Sustainable Agriculture) and is a Selected Grower under the Marks & Spencer Field to Fork programme.

DJT Plants holds a licence from the Home Office of the UK Government to grow >0.2% THC cannabis for research purposes.

The Directors of the Company accept responsibility for the contents of this announcement.

ANANDA DEVELOPMENTS PLC
Chief Executive Officer
Melissa Sturgess

Investor Relations
Jeremy Sturgess-Smith

+44 (0)7463 686 497
ir@anandadevelopments.com
PETERHOUSE CAPITAL LIMITED
Corporate Finance
Mark Anwyl

Corporate Broking
Lucy Williams
Duncan Vasey

YELLOW JERSEY PR
Alison Hicks
Charles Goodwin

+44 (0)20 7469 0930

+44 (0) 7585 953 660
+44 (0) 7747 788 221

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