TIDMGPK
RNS Number : 9401M
Geopark Limited
02 September 2013
GEOPARK LIMITED
RESULTS FOR THE FIRST HALF ENDED 30 JUNE 2013
GeoPark Limited ("GeoPark"), the Latin American oil and gas
explorer, operator and consolidator with operations and production
in Chile, Colombia, Brazil and Argentina (AIM: GPK), is pleased to
announce its first half financial results ended 30 June 2013.
Operational Highlights
-- Oil Production Up 49% to 10,798* bopd in 2Q2013 vs 2Q2012
-- Total Oil and Gas Production Up 12% to 13,020* boepd in 2Q2013 vs 2Q2012
-- New Oil and Gas Discoveries:
- Chercan gas field in Flamenco Block in Tierra del Fuego, Chile
- Tarotaro oil field in Llanos 34 Block, Colombia
- Potrillo oil field in Yamu Block, Colombia
Financial Highlights
-- Revenues Up 32% to US$160.8* million (as of 30 June)
-- Adjusted EBITDA Up 20% to US$84.0* million (as of 30 June)
-- Cash Position of US$149.4 million
Strategic Highlights
-- Risk-balanced entry into Brazil with acquisition of 10%
interest in Manati Field and award of seven exploration blocks in
Potiguar and Reconcavo Basins
* Operational and Financial figures do not include results from
new Brazilian production acquisition, completion of which is
expected in 2H2013.
In accordance with the AIM Rules, the information in this
announcement has been reviewed by Salvador Minniti, a geologist
with 32 years of oil and gas experience and Director of Exploration
of GeoPark.
GeoPark can be visited online at www.geo-park.com
For further information please contact:
GeoPark Limited
Juan Pablo Spoerer (Chile)
Pablo Ducci (Chile) +56 2 2242 9600
Oriel Securities - Nominated Adviser and Joint Broker
Michael Shaw (London) +44 (0)20 7710 7600
Tunga Chigovanyika (London)
Macquarie Capital (Europe) Limited - Joint Broker
Steve Baldwin (London) +44 (0)20 3037 2000
GEOPARK LIMITED
Interim condensed consolidated
financial statements
For the six months ended 30 June 2012 and 2013
CONSOLIDATED STATEMENT OF INCOME
Six-months Six-months
period period
ended 30 ended 30 Year ended
June 2013 June 2012 31 December
Amounts in US$ '000 Note (Unaudited) (1) (Unaudited) 2012
NET REVENUE 2 160,806 121,991 250,478
Production costs 4 (81,147) (54,668) (129,235)
GROSS PROFIT 79,659 67,323 121,243
Exploration costs 5 (13,587) (10,199) (27,890)
Administrative costs 6 (20,730) (13,562) (28,798)
Selling expenses (7,658) (7,981) (24,631)
Other operating income
/ (expense) 4,205 (413) 823
OPERATING PROFIT 41,889 35,168 40,747
Financial income 7 604 318 892
Financial expenses 8 (21,166) (7,662) (17,200)
Bargain purchase gain
on acquisition of subsidiaries 14 - 8,401 8,401
PROFIT BEFORE TAX 21,327 36,225 32,840
Income tax (7,092) (10,863) (14,394)
PROFIT FOR THE PERIOD/YEAR 14,235 25,362 18,446
Attributable to:
Owners of the parent 8,616 19,904 11,879
Non-controlling interest 5,619 5,458 6,567
Earnings per share (in
US$) for profit attributable
to owners of the Company.
Basic 0.20 0.47 0.28
Earnings per share (in
US$) for profit attributable
to owners of the Company.
Diluted 0.19 0.44 0.27
STATEMENT OF COMPREHENSIVE INCOME
Six-months Six-months
period period
ended ended 30 Year ended
30 June June 2012 31 December
Amounts in US$ '000 2013 (Unaudited) (1) (Unaudited) 2012
Profit for the period
/ year 14,235 25,362 18,446
Other comprehensive income - - -
Currency translation (363) - -
differences
Total comprehensive Income
for the period / year 13,872 25,362 18,446
Attributable to:
Owners of the parent 8,253 19,904 11,879
Non-controlling interest 5,619 5,458 6,567
(1) 30 June 2012 comparative information has been restated
reflecting the finalization of the purchase price allocation (see
Note 1).
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
At 30 June Year ended
At 30 June 2012 (1) 31 December
Amounts in US$ '000 Note 2013 (Unaudited) (Unaudited) 2012
ASSETS
NON CURRENT ASSETS
Property, plant and
equipment 9 544,151 388,423 457,837
Prepaid taxes 14,505 5,504 10,707
Other financial assets 2,145 6,738 7,791
Deferred income tax 16,075 10,434 13,591
Prepayments and other
receivables 1,857 610 510
TOTAL NON CURRENT
ASSETS 578,733 411,709 490,436
CURRENT ASSETS
Inventories 5,667 8,934 3,955
Trade receivables 31,288 22,569 32,271
Prepayments and other
receivables 40,809 47,705 49,620
Prepaid taxes 2,376 5,903 3,443
Cash at bank and
in hand 149,437 66,346 48,292
TOTAL CURRENT ASSETS 229,577 151,457 137,581
TOTAL ASSETS 808,310 563,166 628,017
EQUITY
Equity attributable
to owners of the
Company
Share capital 10 43 43 43
Share premium 116,877 118,821 116,817
Reserves 128,058 123,006 128,421
Retained earnings
(losses) 6,242 3,770 (5,860)
Attributable to owners
of the Company 251,220 245,640 239,421
Non-controlling interest 83,459 54,355 72,665
TOTAL EQUITY 334,679 299,995 312,086
LIABILITIES
NON CURRENT LIABILITIES
Borrowings 11 290,624 127,404 165,046
Provisions for other
long-term liabilities 12 26,015 21,839 25,991
Deferred income tax 25,372 18,827 17,502
TOTAL NON CURRENT
LIABILITIES 342,011 168,070 208,539
CURRENT LIABILITIES
Borrowings 11 11,172 27,488 27,986
Current income tax 2,716 1,615 7,315
Trade and other payables 13 117,732 65,998 72,091
TOTAL CURRENT LIABILITIES 131,620 95,101 107,392
TOTAL LIABILITIES 473,631 263,171 315,931
TOTAL EQUITY AND
LIABILITIES 808,310 563,166 628,017
(1) 30 June 2012 comparative information has been restated
reflecting the finalization of the purchase price allocation (see
Note 1).
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Attributable to owners of the
Company
Retained Non -
Amount in US$ Share Share Other Translation (Losses) controlling
'000 Capital Premium Reserve Reserve Earnings Interest Total
Equity at 1 January
2012 43 112,231 114,270 894 (18,549) 41,763 250,652
Profit for the
first half of
the year - - - - 19,904 5,458 25,362
Total comprehensive
income for the
period ended 30
June 2012 - - - - 19,904 5,458 25,362
Proceeds from
transaction with
Non-controlling
interest - 5,696 8,736 - - 7,134 21,566
Shared-based payment - - - - 2,415 - 2,415
- 5,696 8,736 - 2,415 7,134 23,981
Balance at 30
June 2012 (1)
(Unaudited) 43 117,927 123,006 894 3,770 54,355 299,995
Balance at 31
December 2012 43 116,817 127,527 894 (5,860) 72,665 312,086
Profit for the
first half of
the year - - - - 8,616 5,619 14,235
Currency translation
differences - - - (363) - - (363)
Total comprehensive
income for the
period ended 30
June 2013 - - - (363) 8,616 5,619 13,872
Proceeds from
transaction with
Non-controlling
interest - - - - - 5,175 5,175
Shared-based payment - 60 - - 3,486 - 3,546
- 60 - - 3,486 5,175 8,721
Balance at 30
June 2013 (Unaudited) 43 116,877 127,527 531 6,242 83,459 334,679
(1) 30 June 2012 comparative information has been restated
reflecting the finalization of the purchase price allocation (see
Note 1).
(1)
CONSOLIDATED STATEMENT OF CASH FLOW
Six-months
Six-months period
period ended
ended 30 June Year ended
30 June 2012 (1) 31 December,
Amounts in US$ '000 2013 (Unaudited) (Unaudited) 2012
Cash flows from operating
activities
Profit for the period/year 14,235 25,362 18,446
Adjustments for:
Income tax for the period/year 7,092 10,863 14,394
Depreciation of the period/year 32,605 23,395 53,317
Loss on disposal of property,
plant and equipment 568 125 546
Write-off of unsuccessful
efforts 11,788 8,564 25,552
Amortisation of other long-term
liabilities (1,359) (290) (2,143)
Accrual of borrowing's interests 11,881 5,796 12,478
Unwinding of long-term liabilities 505 298 1,262
Accrual of share-based payment 3,486 2,415 5,396
Deferred income - 2,850 5,550
Income tax paid (4,040) (408) (408)
Exchange difference generated
by borrowings (9) 20 35
Bargain purchase gain on
acquisition of subsidiaries
(Note 14) - (8,401) (8,401)
Changes in working capital 20,177 580 5,778
Cash flows from operating
activities - net 96,929 71,169 131,802
Cash flows from investing
activities
Purchase of property, plant
and equipment (143,775) (84,492) (198,204)
Acquisitions of subsidiaries,
net of cash acquired (Note
14) - (105,303) (105,303)
Collections related to financial 6,489 - -
leases
Cash flows used in investing
activities - net (137,286) (189,795) (303,507)
Cash flows from financing
activities
Proceeds from borrowings 292,363 3,923 37,200
Proceeds from transaction
with Non-controlling interest
(2) 36,313 8,869 12,452
Proceeds from loans from 8,344 - -
related parties
Principal paid (179,343) (16,297) (12,382)
Interest paid (6,175) (5,259) (10,895)
Cash flows from (used in)
financing activities - net 151,502 (8,764) 26,375
Net increase (decrease) in
cash and cash equivalents 111,145 (127,390) (145,330)
Cash and cash equivalents
at 1 January 38,292 183,622 183,622
Cash and cash equivalents
at the end of the period/year 149,437 56,232 38,292
Ending Cash and cash equivalents
are specified as follows:
Cash in banks 149,413 66,324 48,268
Cash in hand 24 22 24
Bank overdrafts - (10,114) (10,000)
Cash and cash equivalents 149,437 56,232 38,292
(1) 30 June 2012 comparative information has been restated
reflecting the finalization of the purchase price allocation (see
Note 1).
(2) Proceeds from transaction with Non-controlling interest for
the period ended 30 June 2013 includes: US$ 5,175,000 from capital
contributions received in the period; and US$ 31,138,000 as result
of collection of receivables included in Prepayment and other
receivables as of 31 December 2012, relating to equity transactions
made in 2012 and 2011.
SELECTED EXPLANATORY NOTES
Note 1
General information
GeoPark Limited (the Company) is a company incorporated under
the law of Bermuda. The Registered Office address is Cumberland
House, 9th Floor, 1 Victoria Street, Hamilton HM11, Bermuda. The
Company is quoted on the AIM market of London Stock Exchange
plc.
The principal activity of the Company and its subsidiaries ("the
Group") are exploration, development and production for oil and gas
reserves in Chile, Colombia and Argentina. The Group has working
interests and/or economic interests in 19 hydrocarbon blocks.
On 30 July 2013 the shareholders approved the change of the
Company's name from GeoPark Holdings Limited to GeoPark
Limited.
This consolidated interim financial report was authorised for
issue by the Board of Directors on 29 August, 2013.
Basis of Preparation
The consolidated interim financial report of GeoPark Limited is
presented in accordance with IAS 34 "Interim Financial Reporting".
It does not include all of the information required for full annual
financial statements, and should be read in conjunction with the
annual financial statements as at and for the years ended 31
December 2011 and 2012, which have been prepared in accordance with
IFRSs.
The consolidated interim financial report has been prepared in
accordance with the accounting policies applied in the most recent
annual financial statements. For further information please refer
to GeoPark Limited's consolidated financial statements for the year
ended 31 December 2012.
The comparative information for the period ended 30 June 2012
has been restated from the original condensed financial statements
at that date to include the final estimation of the purchase price
allocation for the business combination related to the acquisition
in Colombia shown in Note 14.
Taxes on income in the interim periods are accrued using the tax
rate that would be applicable to expected total annual profit or
loss.
The activities of the Company are not subject to significant
seasonal changes.
Leases in which substantially all of the risks and rewards of
ownership are transferred to the lessee are classified as finance
leases. Under a finance lease, the Company as lessor has to
recognize an amount receivable equal to the aggregate of the
minimum lease payments plus any unguaranteed residual value
accruing to the lessor, discounted at the interest rate implicit in
the lease (see Note 9).
New and amended standards adopted by the Group
As from 1 January, 2013, the Company applied IFRS 10,
'Consolidated financial statements", IFRS 11, 'Joint arrangements',
IFRS 12, 'Disclosures of interests in other entities'. Those
standards did not materially affect the Company's financial
condition or results of the operations.
Also, as from 1 January 2013 the Company applied IFRS 13 "Fair
value measurement" . This standard has not have a significant
impact on the balances recorded in the financial statements but
would require the company to apply different valuation techniques
to certain items (e.g. debt acquired as part of a business
combination) recognised at fair value as and when they arise in the
future.
Estimates
The preparation of interim financial information requires the
use of certain critical accounting estimates. It also requires
management to exercise its judgement in the process of applying the
Group's accounting policies. Actual results may differ from these
estimates
In preparing these condensed consolidated interim financial
statements, 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 that applied to the
consolidated financial statements for the year ended 31 December
2012.
Financial risk management
The Company's activities expose it to a variety of financial
risks: currency risk, price risk, credit risk- concentration,
funding and liquidity risk, interest risk and capital risk. The
interim condensed consolidated financial statements do not include
all financial risk management information and disclosures required
in the annual financial statements, and should be read in
conjunction with the Company's annual financial statements as at 31
December 2012.
There have been no changes in the risk management since year end
or in any risk management policies.
Subsidiary undertakings
The following chart illustrates the Group structure (*) as of 30
June 2013:
(*) LG International is not a subsidiary, instead of it is
Non-controlling interest.
During 2013, with the purpose of conducting its multilocation
activities and for allowing future business structures, the Company
has incorporated certain wholly owned subsidiaries, that are
dormant companies at the date of the issuance of these interim
financial statements.
Details of the subsidiaries and jointly controlled assets of the
Company are set out below:
Ownership
Name and registered office interest
GeoPark Argentina Ltd.
Subsidiaries - Bermuda 100%
GeoPark Argentina Ltd.
- Argentine Branch 100% (a)
GeoPark Latin America 100%
GeoPark Latin America
- Agencia en Chile 100% (a)
100% (a)
GeoPark S.A. (Chile) (b)
GeoPark Brazil Exploracao
y Producao de Petróleo
e Gas Ltda. (Brazil) 100%
GeoPark Chile S.A. (Chile) 80% (a) (c)
GeoPark Fell S.p.A. (Chile) 80% (a) (c)
GeoPark Magallanes Limitada
(Chile) 80% (a) (c)
GeoPark TdF S.A. (Chile) 69% (a) (d)
GeoPark Colombia S.A.
(Chile) 80% (a) (c)
100% (a)
GeoPark Luna SAS (Colombia) (e) (f)
GeoPark Colombia SAS 100% (a)
(Colombia) (e) (f)
100% (a)
GeoPark Llanos SAS (Colombia) (e) (f)
La Luna Oil Co. Ltd. 100% (a)
(Panama) (e) (f)
GeoPark Colombia PN S.A. 100% (a)
(Panama) (e) (f)
GeoPark Cuerva LLC (United 100% (a)
States) (e) (f)
Sucursal La Luna Oil 100% (a)
Co. Ltd. (Colombia) (e) (f)
Sucursal GeoPark Colombia 100% (a)
PN S.A. (Colombia) (e) (f)
Sucursal GeoPark Cuerva 100% (a)
LLC (Colombia) (e) (f)
GeoPark Brazil S.p.A. 100% (a)
(Chile) (b)
Raven Pipeline Company
LLC (United States) 23.5% (b)
GeoPark Colombia Cooperatie
U.A. (The Netherlands) 100% (b)
GeoPark Brazil Cooperatie
U.A. (The Netherlands) 100% (b)
Jointly controlled
assets Tranquilo Block (Chile) 29%
Otway Block (Chile) 100% (g)
Flamenco Block (Chile) 50% (h)
Isla Norte Block (Chile) 60% (h)
Campanario Block (Chile) 50% (h)
(a) Indirectly owned.
(b) Dormant companies.
(c) LG International has 20% interest.
(d) LG International has 20% interest through GeoPark Chile S.A. and a 14% direct interest.
(e) During the first quarter of 2012, the Company entered into a
business combination acquiring 100% interest in each entity (see
Note 14).
(f) During 2013, the Company has started a merger process by
which a sole company will continue the operations related to the
referred companies. The Company estimates that the process will be
completed by year end.
(g) In April 2013, the Group voluntarily relinquished to the
Chilean Government all of our acreage in the Otway Block, except
for 49,421 acres. In May 2013, our partners under the joint
operating agreement governing the Otway Block decided to withdraw
from such joint operating agreement and to apply to withdraw from
the Otway Block CEOP, such that, subject to the Chilean Ministry of
Energy's approval, the Group will be the sole participant, and have
a working interest of 100%, in our two remaining areas in the Otway
Block.
(h) GeoPark is the operator in all blocks with a share of 60%
for Isla Norte Block and 50% for the other 2 blocks (See Note
16).
Note 2
Net revenue
Six-months Six-months
period period Year ended
Amounts in US$ ended 30 ended 30 31 December
'000 June 2013 June 2012 2012
Sale of crude
oil 149,817 104,893 221,564
Sale of gas 10,989 17,098 28,914
160,806 121,991 250,478
Note 3
Segment Information
Operating segments are reported in a manner consistent with the
internal reporting provided to the chief operating decision-maker.
The chief operating decision-maker, who is responsible for
allocating resources and assessing performance of the operating
segments, has been identified as the strategic steering committee.
This committee is integrated by the CEO, Managing Director, CFO and
managers in charge of the Geoscience, Drilling, Operations and
SPEED departments. This committee reviews the Group's internal
reporting in order to assess performance and allocate resources.
Management has determined the operating segments based on these
reports.
The committee considers the business from a geographic
perspective.
The strategic steering committee assesses the performance of the
operating segments based on a measure of adjusted earnings before
interest, tax, depreciation, amortisation and certain non cash
items such as write offs and share based payments (Adjusted
EBITDA). This measurement basis excludes the effects of
non-recurring expenditure from the operating segments, such as
impairments when it is result of an isolated, non-recurring event.
Interest income and expenditure are not included in the result for
each operating segment that is reviewed by the strategic steering
committee. Other information provided, except as noted below, to
the strategic steering committee is measured in a manner consistent
with that in the financial statements.
Six-months period ended 30 June 2013
Amounts in US$
'000 Total Argentina Chile Brazil Colombia Corporate
NET REVENUE 160,806 733 82,855 - 77,218 -
GROSS PROFIT 79,659 19 49,167 - 30,473 -
OPERATING PROFIT
/ (LOSS) 41,889 (1,822) 33,239 (1,365) 17,801 (5,964)
Adjusted EBITDA 84,014 (1,284) 52,267 (1,341) 38,296 (3,924)
Six-months period ended 30 June 2012
Amounts in US$
'000 Total Argentina Chile Brazil Colombia Corporate
NET REVENUE 121,991 664 85,320 - 36,007 -
GROSS PROFIT 67,323 146 52,135 - 14,888 154
OPERATING PROFIT
/ (LOSS) 35,168 (2,714) 36,572 - 4,625 (3,315)
Adjusted EBITDA 70,274 (808) 59,028 - 15,310 (3,256)
Total Assets Total Argentina Chile Brazil Colombia Corporate
30 June 2013 808,310 7,207 424,743 31,200 259,640 85,520
31 December 2012 628,017 6,108 405,674 - 213,202 3,033
30 June 2012 563,166 6,108 377,165 - 177,552 2,341
A reconciliation of total Adjusted EBITDA to total profit before
income tax is provided as follows:
Six-months Six-months
period ended period ended
30 June 2013 30 June 2012
Adjusted EBITDA for reportable
segments 84,014 70,274
Depreciation (32,605) (23,395)
Accrual of stock awards (3,486) (2,415)
Write-off of unsuccessful
efforts (11,788) (8,564)
Others 5,754 (732)
Operating profit 41,889 35,168
Financial results (20,562) (7,344)
Bargain purchase gain
on acquisition of subsidiaries - 8,401
Profit before tax 21,327 36,225
Note 4
Production costs
Six-months Six-months Year
period period ended
ended ended 31 December
30 June 30 June 2012
Amounts in US$ '000 2013 2012
Depreciation 31,898 22,950 52,307
Royalties 8,650 6,283 11,424
Staff costs 7,518 4,310 14,171
Transportation costs 4,946 3,213 7,211
Well and facilities
maintenance 9,003 4,127 9,385
Consumables 6,610 3,996 9,884
Equipment rental 2,360 3,044 5,936
Other costs 10,162 6,745 18,917
81,147 54,668 129,235
Note 5
Exploration costs
Amounts in US$ '000 Six-months Six-months Year ended
period period 31 December
ended 30 ended 2012
June 2013 30 June
2012
Staff costs 4,084 1,587 4,418
Allocation to capitalised
project (1,145) (736) (1,849)
Write-off of unsuccessful
efforts 11,788 8,564 25,552
Amortisation of other
long-term liabilities
related to unsuccessful
efforts (600) - (1,500)
Recovery of abandonments
costs (759) - -
Other services 219 784 1,269
13,587 10,199 27,890
Note 6
Administrative costs
Six-months
Six-months period
period ended Year ended
ended 30 30 June 31 December
Amounts in US$ '000 June 2013 2012 2012
Staff costs 9,976 6,136 9,575
Consultant fees 3,082 2,551 5,122
New projects 661 533 2,927
Office expenses 781 956 3,293
Director fees and
allowance 992 1,067 1,516
Travel expenses 1,190 534 1,563
Depreciation 707 445 1,010
Other administrative
expenses 3,341 1,340 3,792
20,730 13,562 28,798
Note 7
Financial income
Six-months Six-months Year ended
period period 31 December
Amounts in US$ ended 30 ended 30 2012
'000 June 2013 June 2012
Exchange difference 2 70 348
Interest received 602 248 544
604 318 892
Note 8
Financial expenses
Six-months Six-months
period period
ended ended Year ended
30 June 30 June 31 December
Amounts in US$ '000 2013 2012 2012
Bank charges and other
financial costs 1,568 838 1,764
Bond GeoPark Fell SpA 8,603 - -
cancellation costs
(Note 11)
Exchange difference 1,483 1,045 2,429
Unwinding of long-term
liabilities 505 298 1,262
Interest and amortisation
of debt issue costs 9,931 6,132 13,114
Less: amounts capitalised
on qualifying assets (924) (651) (1,369)
21,166 7,662 17,200
Note 9
Property, plant and equipment
Exploration
Oil & Furniture, Production Buildings and
Amounts in gas equipment facilities and Construction evaluation
US$'000 properties and vehicles and machinery improve-ments in progress assets TOTAL
Cost at 1
January
2012 171,956 2,175 47,102 2,437 32,896 42,140 298,706
Additions 1,083 548 351 - 28,332 54,585 84,899
Disposals (48) (60) (17) - - - (125)
Write-off and
impairment
(1) - - - - - (8,564) (8,564)
Transfers 51,679 - 5,835 466 (36,148) (21,832) -
Acquisitions
of
subsidiaries 62,384 481 10,865 - 9,359 27,884 110,973
Cost at 30
June
2012 287,054 3,144 64,136 2,903 34,439 94,213 485,889
Cost at 1
January
2013 344,371 3,576 86,949 3,198 54,025 93,106 585,225
Additions 2,502 1,128 10 47 59,479 83,979 147,145
Disposals (2) (546) (22) (15,870) - - - (16,438)
Write-off and
impairment
(1) - - - - - (11,788) (11,788)
Transfers 77,166 - 14,963 927 (61,433) (31,623) -
Cost at 30
June
2013 423,493 4,682 86,052 4,172 52,071 133,674 704,144
Depreciation
and
write-down
at 1 January
2012 (53,604) (1,123) (18,628) (716) - - (74,071)
Depreciation (19,126) (322) (3,810) (137) - - (23,395)
Depreciation
and
write-down
at 30 June
2012 (72,730) (1,445) (22,438) (853) - - (97,466)
Depreciation
and
write-down
at 1 January
2013 (98,156) (1,836) (26,336) (1,060) - - (127,388)
Depreciation (27,418) (427) (4,480) (280) - - (32,605)
Depreciation
and
write-down
at 30 June
2013 (125,574) (2,263) (30,816) (1,340) - - (159,993)
Carrying
amount
at 30 June
2012 214,324 1,699 41,698 2,050 34,439 94,213 388,423
Carrying
amount
at 30 June
2013 297,919 2,419 55,236 2,832 52,071 133,674 544,151
(1) Corresponds to write-off of Exploration and evaluation
assets in Colombia US$ 3,035,000 (US$ 2,619,000 in 2012) and Chile
US$ 8,753,000 (US$ 5,945,000 in 2012).
(2) During 2013, the Company entered into a finance lease for
which it has transferred a substantial portion of the risk and
rewards of some assets which had a book value of US$ 14.1 million.
As of 30 June 2013 trade receivables include receivables under
finance leases for amount of US$ 7.8 million, which US$ 6.3 million
are maturity no later than one year and US$ 1.5 million between one
and five years. Total unearned interest income amounts to US$ 1.5
million .
Note 10
Share capital
Six-months Six-months
period period Year ended
ended 30 ended 30 31 December
Issued share capital June 2013 June 2012 2012
Common stock (US$ '000) 43 43 43
The share capital is distributed
as follows:
Common shares, of nominal
US$ 0.001 43,495,585 42,474,274 43,495,585
Total common shares in
issue 43,495,585 42,474,274 43,495,585
Authorised share capital
US$ per share 0.001 0.001 0.001
Number of common shares
(US$ 0.001 each) 5,171,969,000 5,171,969,000 5,171,969,000
Amount in US$ 5,171,969 5,171,969 5,171,969
Note 11
Borrowings
The outstanding amounts are as follows:
At At Year ended
Amounts in US$ 30 June 30 June 31 December
'000 2013 2012 2012
Bond GeoPark Latin 299,577 - -
America Agencia
en Chile (a)
Bond GeoPark Fell
SpA (b) - 128,838 129,452
Methanex Corporation
(c) - 8,041 8,036
Banco de Crédito
e Inversiones (d) 2,219 7,899 7,859
Overdrafts (e) - 10,114 10,000
Banco Itaú
(f) - - 37,685
301,796 154,892 193,032
Classified as follows:
Current 11,172 27,488 27,986
Non-Current 290,624 127,404 165,046
(a) During February 2013, the Company successfully placed US$
300 million notes which were offered under Rule 144A and Regulation
S exemptions of the United States Securities laws.
The Notes, issued by the Company's wholly-owned subsidiary
GeoPark Latin America Limited Agencia en Chile ("the Issuer"), were
priced at 99.332% and will carry a coupon of 7.50% per annum to
yield 7.625% per annum. Final maturity of the notes will be 11
February 2020. The Notes are guaranteed by GeoPark Limited and
GeoPark Latin America Chilean Branch and are secured with a pledge
of all of the equity interests of the Issuer in GeoPark Chile S.A.
and GeoPark Colombia S.A. and a pledge of certain intercompany
loans. Notes were rated single B by both Standard & Poor's and
Fitch Ratings.
The net proceeds of the notes were partially used to repay debt
of approximately US$ 170 million, including the existing Reg S
Notes due 2015 and the Itaú loan. The remaining proceeds will be
used to finance the Company's expansion plans in the region. The
transaction extends GeoPark's debt maturity significantly, allowing
the Company to allocate more resources to its investment and
inorganic growth programs in the coming years.
(b) Private placement of US$ 133,000,000 of Reg S Notes on 2
December 2010. The Notes carried a coupon of 7.75% per annum and
mature on 15 December 2015. These Notes were fully repaid in March
2013.
(c) The financing obtained in 2007, for development and
investing activities on the Fell Block, was structured as a gas
pre-sale agreement with a six year pay-back period and an interest
rate of LIBOR flat. The loan has been fully repaid during 2013.
In addition on 30 October 2009 another financing agreement was
signed with Methanex Corporation under which Methanex have funded
GeoPark's portions of cash calls for the Otway Joint Venture for
US$ 3,100,000. This financing did not bear interest. The loan was
fully repaid during 2012.
(d) Facility to establish the operational base in the Fell
Block. This facility was acquired through a mortgage loan granted
by the Banco de Crédito e Inversiones (BCI), a Chilean private
bank. The loan was granted in Chilean pesos and is repayable over a
period of 8 years. The interest rate applicable to this loan is
6.6%. The outstanding amount at 30 June 2013 is US$ 273,000.
During the last quarter of 2011, GeoPark TdF obtained short-term
financing from BCI. This financing is structured as letter of
credit with a pledge of the seismic equipment acquired to start the
operations in the new blocks. The maturity is February 2014 and the
applicable interest rate ranging from 4.45% to 5.45%. The
outstanding amount at 30 June 2013 is US$ 1,946,000.
(e) At 30 June 2013, the Group has credit lines availables with
several banks for approximately US$ 52,000,000.
(f) GeoPark Limited executed a loan agreement with Banco Itaú
BBA S.A., Nassau Branch for US$ 37,500,000. GeoPark used the
proceeds to finance the acquisition and development of the La
Cuerva and Llanos 62 blocks. This loan was fully repaid in February
2013.
Note 12
Provision for other long-term liabilities
The outstanding amounts are as follows:
At At Year ended
Amounts in US$ 30 June 30 June 31 December
'000 2013 2012 2012
Assets retirement
obligation and
other environmental
liabilities 19,140 13,013 16,213
Deferred income 6,119 6,521 7,369
Other 756 2,305 2,409
26,015 21,839 25,991
Note 13
Trade and other payables
The outstanding amounts are as follows:
At At Year ended
Amounts in US$ 30 June 30 June 31 December
'000 2013 2012 2012
Trade payables 89,396 47,499 54,890
Payables to related 8,465 - -
parties (1)
Staff costs to
be paid 5,085 3,274 5,867
Royalties to be
paid 4,151 4,189 3,909
Taxes and other
debts to be paid 5,718 7,194 5,418
To be paid to co-venturers 4,917 3,842 2,007
117,732 65,998 72,091
(1) In December 2012, LGI entered into GeoPark's operations in
Colombia through the acquisition of a 20% of interest in GeoPark
Colombia S.A. As part of the transaction, LGI committed to fund the
operations in Colombia through loans (See Note 35 to the audited
Consolidated Financial Statements as of 31 December 2012).
Note 14
Acquisitions in Colombia
In February 2012, GeoPark acquired two privately-held
exploration and production companies operating in Colombia,
Winchester Oil and Gas S.A. and La Luna Oil Company Limited S.A.
("Winchester Luna").
In March 2012, a second acquisition occurred with the purchase
of Hupecol Cuerva LLC ("Hupecol"), a privately-held company with
two exploration and production blocks in Colombia.
The following table summarises the combined consideration paid
for Winchester Luna and Hupecol, the fair value of assets acquired
and liabilities assumed for these transactions:
Amounts in US$ Winchester
'000 Hupecol Luna Total
Cash (including
working capital
adjustments) 79,630 32,243 111,873
Total consideration 79,630 32,243 111,873
Cash and cash equivalents 976 5,594 6,570
Property, plant
and equipment (including
mineral interest) 73,791 37,182 110,973
Trade receivables 4,402 4,098 8,500
Prepayments and
other receivables 5,640 2,983 8,623
Deferred income
tax assets 10,344 5,262 15,606
Inventories 10,596 1,612 12,208
Trade payables
and other debt (20,487) (11,981) (32,468)
Borrowings - (1,368) (1,368)
Provision for other
long-term liabilities (5,632) (2,738) (8,370)
Total identifiable
net assets 79,630 40,644 120,274
Bargain purchase
gain on acquisition
of subsidiaries - 8,401 8,401
In 2012, the results of the operations corresponding to
Winchester Luna and Hupecol were consolidated since the acquisition
date, February and April, respectively.
See Note 35 to the audited Consolidated Financial Statements as
of 31 December 2012.
Note 15
Entry in Brazil
Proposed acquisition in Brazil
GeoPark entered into Brazil with the proposed acquisition of a
ten percent working interest in the offshore Manati gas field
("Manati Field"), the largest natural gas producing field in
Brazil. On May 14, 2013, GeoPark executed a stock purchase
agreement ("SPA") with Panoro Energy do Brazil Ltda., the
subsidiary of Panoro Energy ASA, ("Panoro"), a Norwegian listed
company with assets in Brazil and Africa, to acquire all of the
issued and outstanding shares of its wholly-owned Brazilian
subsidiary, Rio das Contas Produtora de Petróleo Ltda ("Rio das
Contas"), the direct owner of 10% of the BCAM-40 block (the
"Block"), which includes the shallow-depth offshore Manati Field in
the Camamu-Almada basin.
The Manati Field is a strategically important, profitable
upstream asset in Brazil and currently provides approximately 50%
of the gas supplied to the northeastern region of Brazil and more
than 75% of the gas supplied to Salvador, the largest city and
capital of the northeastern state of Bahia. The field is largely
developed with existing producing wells and an extensive pipeline,
treatment and delivery infrastructure and is not expected to
require significant future capital expenditures to meet current
production estimates. Additional reserve development may be
possible.
The Manati Field is operated by Petrobras (35% working
interest), the Brazilian national company, largest oil and gas
operator in Brazil and internationally-respected offshore operator.
Other partners in the block include Queiroz Galvao Exploracao e
Producao (45% working interest) and Brasoil Manati Exploracao
Petrolifera S.A. (10% working interest).
GeoPark has agreed to pay a cash consideration of US$140 million
at closing, which will be adjusted for working capital with an
effective date of April 30, 2013. The agreement also provides for
possible future contingent payments by GeoPark over the next five
years, depending on the economic performance and cash generation of
the Block. The closing of the acquisition is subject to certain
conditions, including approval by the Brazilian National Petroleum,
Natural Gas and Biofuels Agency ("ANP") and the Brazilian antitrust
authorities. This is expected to occur during the second half of
2013.
The Manati Field acquisition provides GeoPark with:
- A solid foundational platform in Brazil to support future
growth and expansion in Brazil - one of the world's most attractive
hydrocarbon regions.
- Participation in an economically-attractive and strategic
asset representing the largest non-associated gas producing field
in Brazil, with a gross production of over 211 million cubic feet
per day of gas and a secure attractively-priced long term off take
contract that covers 75% of proven reserves (100% of proven
developed reserves).
- A low-risk and fully-developed producing gas field with no
significant drilling or capital expenditure investments
expected.
- A valuable partnership with Petrobras, the largest operator in Brazil.
- An established geoscience and administrative team to manage the assets - and seek new growth opportunities.
New operations in Brazil
On 14 May 2013, the Company has been awarded seven new licenses
in the Brazilian Round 11 of which two are in the Reconcavo Basin
in the State of Bahia and five are in the Potiguar Basin in the
State of Rio Grande do Norte.
The licensing round was organized by the ANP and all proceedings
and bids have been made public. The winning bids are subject to
final approval of ANP, which is expected to occur during the third
quarter of 2013.
For its winning bids on the seven blocks, GeoPark has committed
to invest a minimum of US$15.3 million (including bonus and work
program commitment) during the first 3 years of the exploratory
period. The new blocks cover an area of approximately 54,850
acres.
On 25 June 2013, the Company contributed US$ 31 million to the
Brazilian subsidiary as a capital contribution.
Note 16
Drilling operations start-up in Tierra del Fuego
In April 2013, the Company has started the exploration drilling
in Tierra del Fuego in Chile in its partnership with Empresa
Nacional de Petroleo de Chile ("ENAP") with the spudding of the
Chercán 1 well on the Flamenco Block. Chercán 1 is the first of 21
exploratory wells on the Flamenco, Campanario and Isla Norte Blocks
in Tierra del Fuego as part of an estimated US$ 100 million
investment commitment during the First Exploration Period. As of
the date of this interim consolidated financial report, more than
1,200 sq km of 3D seismic have been carried out over the three
blocks; out of a total 3D seismic program of approximately 1,500 sq
km.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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