Estimated costs of dismantling oil and gas production
facilities, including abandonment and site restoration costs,
amount to US$0.1 million and US$0.1 million at 30 June 2013 and 31
December 2012, respectively, are included in the cost of oil and
gas properties. The Group has estimated its liability based on
current environmental legislation using estimated costs when the
expenses are expected to be incurred.
7 Other Non-Current Assets
30 June 30 June 31 December
2013 2012 2012
---------------------------------- -------- -------- ------------
Loans issued to related parties
(Note 14) 565 818 519
Advances to contractors and
suppliers for construction in
process 734 168 504
Intangible assets 30 132 77
Total other non-current assets 1,329 1,118 1,100
---------------------------------- -------- -------- ------------
8 Accounts Payable and Accrued Expenses
30 June 30 June 31 December
2013 2012 2012
-------------------------------------- -------- -------- ------------
Trade payables 440 735 522
Accounts payable for construction
in process 72 349 144
Wages and salaries 1,690 2,458 1,696
Short-term finance lease obligations 102 65 88
Other payable and accrued expenses 1,887 2,214 2,110
-------------------------------------- -------- -------- ------------
Total accounts payable and accrued
expenses 4,191 5,821 4,560
-------------------------------------- -------- -------- ------------
9 Borrowings
Short-term borrowings
Short-term borrowings were as follows at 30 June 2013 and 31
December 2012:
30 June 30 June 31 December
2013 2012 2012
----------------------------- -------- -------- ------------
Long-term borrowings
Petraco
* Principal
2,865
* Interest - -
Total long-term borrowings - 2,965 -
Short-term borrowings
Petraco
* Principal 2,500 7,316 -
* Interest 3,011 - 3,004
Total short-term borrowings 5,511 7,316 3,004
Total borrowings 5,511 10,181 3,004
----------------------------- -------- -------- ------------
Petraco
On 12 April 2010 the Company reached an agreement (subsequently
amended on 18 November 2010) with Petraco relating to the
restructuring of the Petraco facility (the "Restructuring
Agreement"). The principal terms of the Restructuring Agreement are
as follows:
Total indebtedness owed by the Company to Petraco, as at 31
March 2010, was $34.3 million, made up as follows:
- capital amount outstanding (the "Capital Outstanding") of US$30.7 million; and
- accrued interest outstanding (the "Accrued Interest") of US$3.6 million.
As at 1 April 2010, the Capital Outstanding and Accrued Interest
were added together and carried forward as principal ("Principal").
After 1 April 2010 interest was accrued on the Principal and was
not compounded. All accrued interest from 1 April 2010 was paid
once the Principal has been repaid and all payments made by the
Company according to the payment schedule set out below was applied
against the Principal outstanding. Interest will be charged on the
Principal at a rate of 6 month LIBOR plus 5% per annum,
non-compounding.
As part of the restructuring agreement the Company converted
US$2 million of the Capital Outstanding into 8,693,006 ordinary
shares of the Company (recorded in the consolidated statement of
changes in shareholders' equity) and gave an option to Petraco to
acquire additional new ordinary shares in the amount of 12,576,688
for GBP 0.26 per share. The fair value of the option is not
material. This option is considered as non dilutive instrument.
In June 2010 the Company pledged 100% of the shares it currently
holds in Arcticneft and 97.2% of shares it currently holds in
Petrosakh to Petraco as security against the restructured Petraco
facility. In August 2012 Petraco released its charge over the
shares of Petrosakh in full.
Outstanding interest US$3.0 million is repayable on 31 December
2013 (as amended on 18 November 2010).
In June 2013 the Company entered into a short-term loan
agreement with Petraco under which Petraco will advance the sum up
to US$7.0 million. The key terms of the loan are that:
- it is repayable immediately following the loading of the next
tanker shipment, scheduled for Autumn 2013 or 30 November 2013
(whichever is earlier);
- interest is chargeable at the rate of 5% over LIBOR until the
date of the bill of lading of the tanker at which point it reduces
to 2% over LIBOR; and
- it is included in Petraco's existing security over CJSC
Arcticneft, further details of which appear in the Company's
announcement dated 12 April 2010.
Weighted average interest rate
The Group's weighted average interest rates on borrowings were
5.5% and 5.5% at 30 June 2013 and 31 December 2012,
respectively.
Interest income and expense
Interest income and expense for the six months ended 30 June
2013 and 30 June 2012, respectively, comprised the following:
Six months ended 30
June
----------------------
2013 2012
------------------------------------------- ---------- ----------
Interest income
Related party loans issued (Note 14) 379 44
------------------------------------------- ---------- ----------
Total interest income 379 44
------------------------------------------- ---------- ----------
Interest on loan from Petraco Oil Company
Limited (7) (163)
Finance leases (93) (35)
Change in dismantlement provision due to
passage of time (103) (80)
Total interest expense (203) (278)
Net finance income/(expense) 176 (234)
------------------------------------------- ---------- ----------
10 Equity
At 30 June 2013 authorised share capital was $1,890 thousand
divided into 300 million shares of $0.0063 each.
Difference
from
Number conversion
of of
shares share capital
(thousand Share Share to
of shares) capital premium USD
-------------------------------- ------------ --------- --------- ---------------
Balance at 1 January 2012 249,251 1,569 656,988 (113)
Shares issued under restricted
stock plans 3,195 20 (20) -
Balance at 30 June 2012 252,446 1,589 656,968 (113)
-------------------------------- ------------ --------- --------- ---------------
Balance at 1 January 2013 252,446 1,589 656,968 (113)
Shares issued under restricted
stock plans - - - -
Balance at 30 June 2013 252,446 1,589 656,968 (113)
-------------------------------- ------------ --------- --------- ---------------
Restricted Stock Plan
At 30 June 2012, restricted stock grants for 3,194,914 shares
were fully issued.
As of 30 June 2013, the number of unvested restricted stock
grants and their respective vesting dates are presented in the
table below.
January January January
Date of Grant 2009 2010 2011 Total
Unvested Restricted Stock
Granted as of 31 December
2012 354,096 354,095 260,180 968,371
Vested in the six months
ended 30 June 2013 - - - -
-------------------------------- -------- -------- ---------- --------
Total Restricted Stock Granted
as of 30 June 2013 354,096 354,095 260,180 968,371
-------------------------------- -------- -------- ---------- --------
Profit/(loss) per share
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