Additions at cost - -
Transfer of assets on dilution
of subsidiary - (26,252,100)
Balance carried forward 6,642,279 6,642,279
Impairment
Balance brought forward 9,220,905 6,170,357
Charge in year - 3,050,548
Translation reserve - -
Balance carried forward 9,220,905 9,220,905
_______ ________
Total - -
The development expenditure relates to development of the
petroleum exploration project in Papua New Guinea and the uranium
exploration project in the Morondava basin of Madagascar.
The licences relate to uranium exploration licences in the
Morondava basin and, for 2012, the petroleum exploration project in
Papua New Guinea.
The Morondava uranium project has yet to reach a stage of
development where a determination of the technical feasibility or
commercial viability can be assessed. In addition, as Madagascar is
presently experiencing a period of political upheaval and
uncertainty, the Company has resolved to take a cautious approach
to exploration and accordingly has not conducted exploration
activities during the current financial year and does not expect to
undertake any material exploration activities in Madagascar whilst
this period of uncertainty prevails. In these circumstances,
whether there is any indication that the asset has been impaired is
a matter of judgement, as is the determination of the quantum of
any required impairment adjustment. The directors have resolved
that it is not appropriate to capitalise any further expenditure on
the intangible asset until circumstances change. The Directors have
used their experience to conclude that an impairment adjustment of
$nil is required in the current year (31 December 2012:
$3,050,548).
In March 2012, the PNG Energy Group ceased to be controlled by
the company and therefore, the exploration licences were
transferred on dilution of the subsidiary. See note 11 for further
information.
10. Property, plant and equipment
Equipment and furniture
31 December 31 December
2013 2012
Restated
$ $
Cost
Balance brought forward 4,620 3,001
Additions - 1,619
Exchange movement - -
_____ _____
Balance carried forward 4,620 4,620
Depreciation
Balance brought forward 3,608 3,013
Charge for the year 788 595
Exchange movement 25 -
_____ _____
Balance carried forward 4,421 3,608
Net book value 199 1,012
11. Investments in associated undertaking
On 26 March 2012, UMC Energy PLC ("PLC") entered agreements with
CNOOC Australia Limited ("CNOOC"), a subsidiary of CNOOC Limited,
the Chinese multi-national oil and gas company listed on the New
York and Hong Kong Stock Exchanges, whereby CNOOC subscribed for a
70% equity interest in PNG Energy Limited with UMC Energy retaining
a 30% equity interest.
As a result of this transaction, in March 2012 the PNG Energy
group ceased to be controlled by the Group and became an equity
accounted associate.
On 4 December 2012, PLC entered a deed with UMC Energy Ltd
(incorporated in the British Virgin Islands (BVI)), an indirect
wholly owned subsidiary of the Company, whereby PLC transferred its
shares in PNG Energy Ltd to UMC Energy Ltd. At the same time, PLC
assigned the intellectual property rights it held, pertaining to
the assets owned by PNG Energy Ltd, to UMC Energy Ltd.
As a result of these transactions, the Company has an equity
holding in the following associate undertaking:
PNG Energy
group
Direct -
Indirect 30%
Total 30%
The country of incorporation of the associate undertaking is the
British Virgin Islands and the principal place of business is Papua
New Guinea.
31 December 31 December 2012
2013 Restated
$ $
Cost
Balance brought forward 26,238,663 -
Additions in the year 146,219 26,252,100
Share of associated undertaking's
results (87,225) (13,437)
Balance carried forward 26,297,657 26,238,663
Amortisation/impairment
Balance brought forward - -
Impairment charge - -
Balance carried forward - -
Net Book Value 26,297,657 26,238,663
The Papua New Guinea petroleum project has yet to reach a stage
of development where a determination of the technical feasibility
or commercial viability can be assessed. In these circumstances,
whether there is any indication that the asset has been impaired is
a matter of judgment, as is the determination of the quantum of any
required impairment adjustment. The Directors have used their
experience to conclude that no impairment adjustment is required in
the current year (31 December 2012: $nil).
Summarised results of the associate undertaking, PNG Energy
Group, as translated into US dollars are as follows:
Year ended Year ended
31 December 31 December 2012
2013 Restated
$ $
Revenue 596 2,607
Loss for the period 290,751 44,790
Total assets 4,105,663 120,535
Total liabilities 4,627,135 351,256
12. Controlled entities
Subsidiary Country of Holding Proportion of Nature of
Undertaking incorporation voting shares Business
held
China Pacific Cayman Islands Ordinary shares 100% Holding company
Petroleum
Corporation
UMC Energy British Virgin Ordinary shares 100% Holding company
Ltd Islands
Helios No Papua New Ordinary shares 100% Dormant
56 Ltd Guinea
Uramad Ltd British Virgin Ordinary shares 100% Holding company
Islands
Uramad SA Madagascar Ordinary shares 80% Uranium exploration
On 18 December 2012, UMC Energy PLC sold 398 ordinary shares
which it held in Uramad SA to Uramad Ltd, a company incorporated in
the British Virgin Islands (BVI). Uramad Ltd is a wholly owned
subsidiary of the Company.
The 398 ordinary shares (being the Group's entire equity
interest in Uramad SA) were sold at a par value of MGA 20,000 each
for a consideration of $3,057,910. This amount was subsequently
fully impaired in the 2012 financial year.
On 4 December 2012, UMC Energy PLC sold to UMC Energy Ltd, a
company incorporated in the British Virgin Islands (BVI), in
accordance with the terms of the Deed of Accession and Indemnity
Agreement, 1 million ordinary shares of no par value in PNG Energy
Ltd (being the Group's entire equity interest in PNG Energy
Ltd).
The Company also assigned and transferred to UMC Energy Ltd all
intellectual property rights it held pertaining to the assets of
PNG Energy Ltd (company incorporated in BVI) and its wholly owned
subsidiary, Gini Energy Ltd (company incorporated in Papua New
Guinea).
The consideration for the sale of the securities and the
assignment of transfer of the intellectual property was
$26,252,100.
13. Taxation receivable - non-current
31 December 31 December 2012
2013 Restated
$ $
Value added tax - Madagascar 370,944 370,944
Impairment brought forward 370,944 370,944
Impairment carried forward 370,944 370,944
Net book value - -
The value added tax is recoverable upon commencement of
production of the mining project in Madagascar.
Following the impairment write down of the intangible assets
(see note 9) the receivable has been impaired in full.
14. Taxation receivable - current
31 December 31 December 2012
2013 Restated
$ $
Value added tax - UK - 3,884
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