TIDMRRL
RNS Number : 9267N
Range Resources Limited
27 September 2019
Range Resources Limited
('Range' or 'the Company')
27 September 2019
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"). UPON THE
PUBLICATION OF THIS ANNOUNCEMENT VIA REGULATORY INFORMATION SERVICE
("RIS"), THIS INSIDE INFORMATION IS NOW CONSIDERED TO BE IN THE
PUBLIC DOMAIN.
AUDITED ANNUAL RESULTS FOR THE 12 MONTHSED 30 JUNE 2019
Range, an international company with oil and gas projects and
oilfield service businesses in Trinidad and Indonesia, today
releases its Annual Report for the 12 months ended 30 June 2019. A
copy of the full Annual Report is available on the Company's
website, www.rangeresources.co.uk and also the Australian
Securities Exchange's website, www.asx.com.au (ASX code: RRS).
2019 Highlights:
-- In Trinidad, the focus continued on low cost production
activities, as well as completion of infrastructure modernisation,
FDP on the Beach Marcelle licence, and new exploration studies on
the St Mary's licence;
-- Net proved and probable reserves (2P) of 15.0 MMbbl and net
contingent resources 2C (P50) of 12.9 MMboe largely unchanged from
FY2018;
-- Subsequent to the year end, the Company signed an SPA with
LandOcean for the sale of Range Resources Trinidad Limited in
exchange for offsetting all outstanding debt and payables (US$91.5
million as at 30 June 2019) and a cash consideration of US$2.5
million, subject to shareholders' approvals and Trinidad government
approvals;
-- Revenues of US$12.4 million (FY2018: US$13.1 million) on
production of 538 bopd (FY 2018: 650 bopd) and realised oil price
of US$59.1 / barrel (FY 2018: US$54.4 / barrel);
-- Net impairment charge against Trinidad and Indonesia of
US$30.2 million (as reported at half-year for the period ended 31
December 2018), with no further impairment recorded on these assets
at year-end;
-- Net loss after tax of US$49.5 million mainly due to the
impairment (FY2018: loss of US$17.5 million); and
-- Cash balance of US$1.8 million (FY2018: US$3.9 million). To
improve the balance sheet and preserve the existing cash position,
a GBP1 million equity placement was completed, as well as an
agreement to pay the annual interest payment under the convertible
note by way of issuance new ordinary shares. Subsequent to the year
end, a GBP0.75 million subscription was completed and a VAT refund
of US$1.03 million received.
Range's Chairman, Zhiwei Gu, commented:
"During the year, our main focus has been on securing debt
restructuring agreements that would allow us to restore the
Company's financial health, increase liquidity and improve
shareholder sentiment. I am delighted that (subsequent to the year
end) our efforts have been rewarded with the signing of a milestone
agreement with LandOcean, which will allow the Company to be
completely debt-free and have sufficient cash resources to progress
with new opportunities. Our aim for the remainder of 2019 (calendar
year) is to secure the necessary approvals to complete this
transformative transaction. As part of a wider strategy, we are
continuing to evaluate attractive acquisition targets and exploring
options in respect of the drilling business in Trinidad. Having
successfully delivered on our agenda with a positive outcome for
all stakeholders, the Company's future looks very exciting. I look
forward to reporting on our progress in the upcoming months."
Contact Details
Cantor Fitzgerald Europe (Nominated
Range Resources Limited Adviser and Broker)
Evgenia Bezruchko (Group Corporate David Porter / Rick Thompson (Corporate
Development Manager & Joint Company Finance)
Secretary) t. +44 (0)20 7894 7000
e. admin@rangeresources.co.uk
t. +44 (0)20 3865 8430
Competent Person statement
The information contained in this announcement has been reviewed
and approved by Mr Lubing Liu. Mr Liu is a suitably qualified
person with over 24 years of industry experience. He holds a BSc in
Petroleum Engineering from the Southwest Petroleum University,
China and is a member of the SPE (Society of Petroleum Engineers).
Mr Liu holds the role of Chief Operating Officer and Trinidad
General Manager with the Company.
The reserves and resources stated in this announcement were
prepared in accordance with the definitions and guidelines in the
Society of Petroleum Engineers (SPE) 2007 Petroleum Resources
Management System (PRMS). The reserve figures are reported
according to Range's net economic interest, net of royalties and
net of lease fuel up to the reference point. The reference point is
defined as the point of sale to third parties. Petroleum reserves
are prepared using deterministic and probabilistic methods. Project
and field totals are aggregated by arithmetic summation by
category.
+ Directors' Report
The Directors of Range Resources Limited ("Range" or "the
Company") and the entities it controls (together, the "Group")
present the financial report for the year ended 30 June 2019.
Directors
The names and details of the Company's directors in office
during the financial year and until the date of this report are as
follows. The directors were in office during the entire period
unless otherwise stated.
Name Position
Mr Zhiwei Gu Executive Chairman (appointed 10 December
2018)
Non-Executive Chairman (resigned 10
December 2018)
==========================================
Mr Lubing Liu Executive Director, Chief Operating
Officer
==========================================
Dr Mu Luo Non-Executive Director (appointed 11
January 2019)
==========================================
Ms Juan Wang Non-Executive Director (resigned 22
July 2019)
==========================================
Mr Yan Liu Executive Director, Chief Executive
Officer (resigned 10 December 2018)
==========================================
Dr Yi Zeng Non-Executive Director (resigned 27
November 2018)
==========================================
Mr Zhiwei Gu: Executive Chairman
Qualifications: LL.B, LL.M., MSc
==========================================
Interest in shares and 2,083,333 ordinary shares
options: 30,000,000 unlisted options (GBP0.01,
30 March 2020)
==========================================
Directorships held in None
other listed entities
during the past three
years
==========================================
Mr Gu is an experienced corporate lawyer, who has worked
with numerous companies seeking listings on various international
stock markets, including the Toronto Stock Exchange and the
Hong Kong Stock Exchange. He is currently a partner of Dentons,
one of the largest global law firms. Mr Gu has participated
in several venture capital and private equity investment
cases by various funds such as London Asia Fund, Warburg
Pincus, Korea Development Bank, China Venture Investment
Co., and China Cinda AMC. During his time with China National
Gold Group Corp., Mr Gu was in charge of mineral resource
merger and acquisition activities. Mr Gu holds a LL.B. from
the Jilin University in China; a LL.M. from the Northeast
University in China; and a Master of Applied Finance from
the Macquarie University in Australia. Mr Gu is a qualified
lawyer and securities practitioner in China.
Mr Lubing Liu: Executive Director, Chief Operating Officer
Qualifications: BSc
============
Interest in shares and None
options:
============
Directorships held in None
other listed entities
during the past three
years
============
Mr Lubing Liu has 24 years of global experience in petroleum
exploration, development, production, joint venture operations
and new ventures. Prior to joining Range, Mr Liu held various
subsurface leader roles, including Chief Reservoir Engineer
with Melbana Energy Limited, Vice President of Exploration
and Petroleum Technology with Sinopec East Puffin Pty Ltd,
and petroleum engineering leader roles with other international
exploration and production and energy service companies including
ConocoPhillips, CNOOC, Woodside, RPS and LR. Mr Liu is experienced
in petroleum engineering and has extensive IOR/EOR (waterflood
inclusive) and gas cycling experience having worked at the
Xijiang24-3/30-2/24-1 oilfields, Liuhua 11-1 oilfield and
Penglai oilfield in China, the Chinguetti oilfield in Mauritania,
Block 95 in Peru, Goodwyn gas field, Thylacine & Geographe
gas field and Longtom gas field in Australia. Mr Liu holds
a BSc in Petroleum Engineering from the Southwest Petroleum
University, China. He is a Member of the Society of Petroleum
Engineers.
Dr Mu Luo: Non-Executive Director
Qualifications: BSc; MSc; PhD
==========================
Interest in shares and None
options:
==========================
Directorships held in None
other listed entities
during the past three
years
==========================
Dr Luo is a senior oil and gas professional with 36 years'
experience working for leading international E&P and oilfield
services companies. He has worked on various giant conventional
and unconventional projects across all levels from research
to operations. He is currently a principal development geophysicist
to Inpex Corporation, leading a multi-billion Ichthys LNG
project in Australia. Prior to that, he held principal roles
with Sinopec Oil and Gas, PGS, Japan Petroleum Exploration
Company Limited, and Japan Oil, Gas and Metals National Corporation.
Dr Luo holds a PhD in Exploration Geophysics from the Curtin
University, Australia; MSc in Geophysics from the University
of Queensland, Australia; and BSc in Geophysics from the
Petroleum University of China. He is a member of the Australian
Society of Exploration Geophysicists, the European Association
of Geoscientists and Engineers, and the Society of Exploration
Geophysicists.
Ms Juan Wang: Non-Executive Director (resigned 22 July 2019)
Qualifications: BA, MBA
===========================================
Interest in shares and 2,083,333 ordinary shares
options:
===========================================
Directorships held in Anterra Energy Inc. (from December 2014
other listed entities to June 2016)
during the past three
years
===========================================
Ms Wang was previously the President of Energy Prospecting
Technology USA, Inc. and LandOcean Energy Canada Ltd. where
she was responsible for overall management work for the subsidiary
companies of LandOcean in Houston and Calgary. Previously,
she was also an investment manager and director at Anterra
Energy Inc. responsible for Chinese investor liaisons and
a manager of corporate mergers and acquisitions at LandOcean.
Ms Wang has a commercial banking background having previously
worked for Deutsche Bank and Bank of East Asia.
Mr Yan Liu: Executive Director, Chief Executive Officer (resigned
10 December 2018)
Qualifications: B.Ec, MCom
===================================
Interest in shares and 6,333,333 ordinary shares
options:
===================================
Directorships held in None
other listed entities
during the past three
years
===================================
Mr Liu has over 20 years of accounting and corporate advisory
experience in China and Australia. Previously, Mr Liu was
a partner of Agile Partners, the financial advisory company
based in China and the Financial Controller at Legalwise
Seminars Pty in Australia. He also spent 8 years at Chinatex
Corporation where he worked in project management positions.
Mr Liu holds a Bachelor degree in Economics from the Central
University of Finance and Economics, China, and a Masters
degree in Commerce from the University of New South Wales,
Australia.
--------------------------------------------------------------------
Dr Yi Zeng: Non-Executive Director (resigned 27 November
2018)
Qualifications: BSc; MSc; PhD
===================================
Interest in shares and None
options:
===================================
Directorships held in None
other listed entities
during the past three
years
===================================
Dr Yi Zeng has over 30 years of experience in the oil and
gas and mining industries. Dr Zeng has held various technical
and research positions with global companies including BHP
Billiton and Santos Asia Pacific. Dr Zeng holds a PhD in
Geophysics from the Victoria University of Wellington, New
Zealand, an MSc in Applied Geophysics and a BSc in Geophysical
Exploration from the Chengdu University of Technology, China.
Company Secretary
The following persons held the position of company secretary
during the financial year:
-- Ms Sara Kelly
-- Ms Evgenia Bezruchko (appointed 1 April 2019)
-- Mr Nick Beattie (resigned 31 March 2019)
Ms Sara Kelly: Joint Company Secretary
Qualifications: B.Com, LLB
===========================================
Interest in shares and 1 ordinary share
options:
===========================================
Directorships held in Homestay Care Limited (from 13 November
other listed entities 2018)
during the past three Ragnar Metals Limited (from June 2017
years to September 2019)
===========================================
Ms Sara Kelly is an experienced Company Secretary and Corporate
Lawyer with over 15 years' experience. Sara has comprehensive
knowledge of and experience in administering regulatory frameworks
and processes in a listed company environment and practised
as a corporate lawyer specialising in acquisitions, takeovers,
capital raisings and listing of companies on ASX and AIM.
Sara has acted as the company secretary of a number of ASX
listed companies. Sara is a partner at Edwards Mac Scovell,
a boutique Western Australian legal practice based in Perth.
Ms Evgenia Bezruchko: Joint Company Secretary (appointed
1 April 2019)
Qualifications: BSc, MSc, MBA
===========================================
Interest in shares and 1,428,571 ordinary shares
options:
===========================================
Directorships held in None
other listed entities
during the past three
years
===========================================
Ms Evgenia Bezruchko has almost 10 years experience in corporate
development and capital markets in natural resources sector.
Prior to joining Range in 2012, Evgenia worked in corporate
broking and equity sales for an independent merchant bank
Brandon Hill Capital (formerly Fox-Davies Capital Limited),
covering a wide range of listed and private oil & gas and
mining companies. Evgenia holds a BSc in Pharmacology from
the University of Bristol, an MSc in Finance from the University
of Westminster and an MBA from the American InterContinental
University.
Mr Nick Beattie: Chief Financial Officer and Joint Company
Secretary (resigned 31 March 2019)
Qualifications: BA (Hons), FCIBS, AMCT
====================================
Interest in shares and 2,916,667 ordinary shares
options:
====================================
Directorships held in None
other listed entities
during the past three
years
====================================
Mr Nick Beattie has 28 years of experience in finance working
with a range of international banks. Most recently he was
a Managing Director in the BNP Paribas Upstream Oil and Gas
team in London where he was responsible for leading the bank
relationships with UK focused independent E&P companies.
Nick has over 10 years' experience specifically financing
the E&P sector and whilst at BNP Paribas, he structured and
led numerous reserve based loans, development financings
and other debt facilities. Prior to working with BNP Paribas,
Nick worked as a Director within the Oil and Gas finance
team at Fortis Bank covering Europe, Middle East and Africa
and in a variety of roles with National Australia Bank Group.
Nick is an Associate Member of the Association of Corporate
Treasurers, a Fellow of the Chartered Institute of Bankers
in Scotland and a Member of the Chartered Institute for Securities
and Investment.
Results of operations
The Company's net loss after taxation attributable to the
members of Range Resources Limited for the year to 30 June 2019 was
US$49.5 million (FY2018: US$17.5 million). Loss for the year from
continuing operations was $US24.4 million (FY2018: US$11.0 million)
and loss for the year from discontinuing operations was US$25.1
million (FY2018: US$6.5 million).
Dividends
No dividend was paid or declared by the Company during the year
and up to the date of this report.
Corporate structure
Range Resources Limited is a company limited by shares, which is
incorporated and domiciled in Australia.
Nature of operations and principal activities
The principal activity of the Group during the financial year
was oil and gas exploration, development and production in
Trinidad.
+ Operational Review
TRINIDAD
Production
The Group's oil and gas production for the financial year was
196,651 barrels (average of 538 bopd) net to Range, which is a 17%
decrease in production from the previous year (FY 2018: 650 bopd).
Production activities comprised low-cost workovers, reactivation
and swabbing activities on the existing wells.
The Company had been facing challenges in maintaining production
rates at consistent levels largely due to the limitations
associated with the infrastructure at the Beach Marcelle field. To
provide a greater resilience in the production infrastructure, the
Company completed infrastructure modernisation programme at the
field including installation of two new 500-barrel settling tanks
and a new 1000-barrel storage tank.
Beach Marcelle waterflood and field development plan
Over the last few years, Range had been conducting waterflood
operations over some parts of the Beach Marcelle field, with
average reported waterflood production from the field during the
year of 135 bopd.
Range in combination with independent consulting groups Rockflow
Resources Ltd and Petrofac Facilities Management Ltd., completed a
full Field Development Plan ("FDP") for the further development of
the Beach Marcelle licence. The main objective of the FDP was to
identify options for expanding waterflood operations over larger
areas of the field, and increasing future production rates and
reserves. The subsurface part of the study also identified areas
where there could be considerable volumes of oil that has not yet
been properly appraised or produced by primary depletion.
Geological tool studies
The Company acquired a new geological tool to undertake studies
on its fields that are expected to significantly enhance subsurface
understanding, and assist in identifying shallow reservoirs and
economic well locations. Preparations of subsurface geological data
surveys had been ongoing.
St Mary's exploration studies
Range in combination with LEAP Energy Partners Sdn. Bhd, an
independent subsurface consultancy, completed new exploration
studies on the licence. The objective of these studies was to
assess the work scope required to convert various leads into
drillable prospects and to establish a future work plan. The study
targeted seven main prospects, at differing reservoir horizons (all
producing at nearby fields), and with different potential volumes
and levels of risk. The study suggests the potential, for each
prospect, of reprocessing some of the seismic data, adding further
2D lines as necessary, and comparing the existing log data with the
analogue producing fields nearby.
Oilfield services
During the year, RRDSL was awarded a new contract with
Touchstone Exploration Trinidad Limited, a subsidiary of Touchstone
Exploration Inc ("Touchstone"). Under the work scope of the
contract, RRDSL provided turnkey services for drilling one well on
Touchstone's onshore WD8 block in Trinidad. The drilling operations
were safely completed. RRDSL also continued to provide swabbing
services on a regular basis to another onshore operator in
Trinidad.
Given challenges at winning new contracts, the Company
identified the need to reduce the costs of RRDSL's services and
improve its competitiveness. As a result, the Company initiated a
corporate restructuring of RRDSL, which resulted in decrease in
headcount by 23% during the year.
Indonesia
Despite continued efforts by the operator of the project to
establish production from the field during the year, no continuous,
sustained production had been achieved. The Company made a decision
to write off the value of its investment in Indonesia (as reported
in the half-yearly report for the period ended 31 December 2018).
The Company is not intending to invest any material further sums
into this project and is exploring opportunities to dispose of its
interest.
CORPORATE
Debt restructuring
On 18 March 2019, Range entered into debt restructuring
agreements with LandOcean Energy Services Co. Ltd ("LandOcean")
conditional on Range completing an acquisition of an interest in a
pre-school educational business operating in China. Subsequent to
the year end, Range announced that despite continued efforts the
Company was not able to agree binding acquisition terms that would
be in the best interest of the Company's shareholders, and the
Board made a decision to terminate the acquisition. As a result,
the debt restructuring agreements announced on 18 March 2019 were
also terminated.
On 3 September 2019, Range announced that it signed a binding
conditional Sale and Purchase Agreement with LandOcean for the sale
of Range Resources Trinidad Limited ("RRTL") (the "SPA") in
exchange for (i) offsetting all outstanding debt and payables
(including the convertible note) due from Range and its
subsidiaries to LandOcean and its subsidiaries, and (ii) a cash
consideration of US$2.5 million (the "Transaction"). RRTL holds
interests in all of Range's oil and gas licences in Trinidad
(onshore), namely Morne Diablo, South Quarry, Beach Marcelle (where
RRTL holds a 100% interest), and St Mary's (where RRTL holds an 80%
interest).
On completion, all outstanding debt from Range and its
subsidiaries to LandOcean and its subsidiaries (including the US$20
million convertible note) will be fully repaid by offsetting
against the consideration and all underlying debt agreements will
be terminated. From the date of signing the SPA and up to the
completion date, all payables by Range to LandOcean under any
underlying debt agreements will be deferred. The maturity date of
the US$20 million convertible note will change to the earlier of
the date on which completion occurs under the SPA or the longstop
date (being 30 June 2020). As part of the agreements, LandOcean
undertakes not to issue a conversion notice.
Completion of the SPA is subject to satisfaction (or waiver) of
the following key conditions:
-- Approval by Range shareholders at General Meeting of the
Company, as the Transaction would be a material disposal falling
under AIM Rule 15 and the ASX Listing Rules and Corporations Act
2001 (Cth), expected to be held in November 2019;
-- Approval by LandOcean shareholders at General Meeting of
LandOcean, expected to be held at the end of October 2019; and
-- Approvals by the government of Trinidad and Tobago.
GBP1m subscription
During the year, the Company completed a subscription for new
ordinary shares to raise GBP1 million before expenses.
GBP0.75 million subscription
Subsequent to the year end, the Company completed a subscription
for new ordinary shares to raise GBP750,000.
As part of the subscription, the investor can nominate up to two
non-executive directors to the Board of the Company and shall
retain this ability for so long as it holds 10% or more of the
Company's shares in issue.
Convertible note interest payment
The Company completed an agreement with LandOcean to pay the
annual interest payment of US$1.6 million under the US$20 million
convertible note by way of issuance new ordinary shares in the
Company. Following approval at the General Meeting, the Company
issued 1,739,076,923 new ordinary shares to LandOcean.
Colombia legacy matter concluded
The court in Colombia approved the decision to settle all
outstanding historic claims and disputes between Agencia Nacional
de Hidrocarburos ("ANH") and the consortium of Optima Oil
Corporation and the Company (the "Consortium"). ANH confirmed that
Range (and the Consortium) has no liability for any payments or
debts and all proposed penalties had been lifted. The Consortium
agreed to waive all potential claims against ANH and to the
termination of the exploration licences.
Georgia
Range submitted a Notice of Arbitration against the State of
Georgia in respect of the wrongful termination of the production
sharing contract over Block VIA dated 29 March 2007 in Georgia.
Range also signed an agreement to acquire Georgian Oil Pty Ltd,
which is a 20% interest holder in Strait Oil and Gas ("SOG") for a
nominal upfront sum. Following completion which occurred in October
2018, Range holds a 65% interest in SOG.
Director and management changes
Dr Mu (Robin) Luo was appointed as a Non-Executive Director of
the Company.
Mr Yan Liu and Dr Yi Zeng tendered their resignations as Chief
Executive Officer & Executive Director and Non-Executive
Director, respectively. Subsequent to the year end, Ms Juan Wang
tendered her resignation as Non-Executive Director of the
Company.
Mr Nick Beattie tendered his resignation as Chief Financial
Officer ("CFO") and Joint Company Secretary. Mr Theo Eleftheriades,
the Group Financial Controller assumed the role of Acting CFO and
Ms Evgenia Bezruchko, the Group Corporate Development Manager
assumed the role of Joint Company Secretary, both with effect from
1 April 2019.
Significant changes in the state of affairs
There have been no significant changes in the state of affairs
of the Group during the financial year, other than as set out in
this report.
Significant events after the reporting date
Debt restructuring
Subsequent to the year end, Range announced that it was unable
to reach terms for the binding agreement to acquire an interest in
a pre-school educational business operating in China. Since debt
restructuring agreements announced on 18 March 2019 were
conditional on Range completing this acquisition, those were also
terminated.
On 3 September 2019, Range announced that it signed a binding
conditional Sale and Purchase Agreement with LandOcean for the sale
of Range Resources Trinidad Limited ("RRTL") (the "SPA") in
exchange for (i) offsetting all outstanding debt and payables
(including the convertible note) due from Range and its
subsidiaries to LandOcean and its subsidiaries, and (ii) a cash
consideration of US$2.5 million (the "Transaction"). RRTL holds
interests in all of Range's oil and gas licences in Trinidad
(onshore), namely Morne Diablo, South Quarry, Beach Marcelle (where
RRTL holds a 100% interest), and St Mary's (where RRTL holds an 80%
interest).
On completion, all outstanding debt from Range and its
subsidiaries to LandOcean and its subsidiaries (including the US$20
million convertible note) will be fully repaid by offsetting
against the consideration and all underlying debt agreements will
be terminated. From the date of signing the SPA and up to the
completion date, all payables by Range to LandOcean under any
underlying debt agreements will be deferred. The maturity date of
the US$20 million convertible note will change to the earlier of
the date on which completion occurs under the SPA or the longstop
date (being 30 June 2020). As part of the agreements, LandOcean
undertakes not to issue a conversion notice.
Completion of the SPA is subject to satisfaction (or waiver) of
the following key conditions:
-- Approval by Range shareholders at General Meeting of the
Company, as the Transaction would be a material disposal falling
under AIM Rule 15 and the ASX Listing Rules and Corporations Act
2001 (Cth), expected to be held in November 2019;
-- Approval by LandOcean shareholders at General Meeting of
LandOcean, expected to be held at the end of October 2019; and
-- Approvals by the government of Trinidad and Tobago.
GBP0.75 million subscription
Subsequent to the year end, the Company completed a subscription
for new ordinary shares to raise GBP0.75 million. As part of the
subscription, the investor can nominate up to two non-executive
directors to the Board of the Company and shall retain this ability
for so long as it holds 10% or more of the Company's shares in
issue.
Director resignation
Ms Juan Wang tendered her resignation as Non-Executive Director
of the Company, effective 22 July 2019.
Likely developments and expected results of operations
The Company's main focus is to complete debt restructuring of
the Group conditional on the sale of Range Resources Trinidad
Limited. In the interim, the Company will continue with its
Trinidad operations. The Company also continues to evaluate new
acquisition opportunities.
Environmental regulations and performance
The Group's operations are not regulated by any significant
environmental regulation under a law of the Commonwealth or of a
state or territory.
The Directors have considered compliance with the National
Greenhouse and Energy Reporting Act 2007 which requires entities to
report annual greenhouse gas emissions and energy use. The
directors have assessed that there are no current reporting
requirements, but may be required to do so in the future.
Share options
As at 30 June 2019, the unissued ordinary shares of Range under
option are as follows:
Date of expiry Exercise price Number under option
3 September 2019 GBP0.01 194,585,862
================ ====================
3 September 2019 GBP0.02 172,557,274
================ ====================
30 March 2020 GBP0.01 37,500,000
================ ====================
Total: 404,643,136
During the year ended 30 June 2019 no ordinary shares of Range
were issued on the exercise of options (2018: nil).
Indemnifying directors and officers
In accordance with the constitution, except where prohibited by
the Corporations Act 2001, every director, principal executive
officer and secretary of the Company shall be indemnified out of
the property of the Company against any liability incurred by
him/her in his/her capacity as director, principal executive
officer or secretary of the Company or any related corporation in
respect of any act or omission whatsoever and howsoever occurring
or in defending any proceedings whether civil or criminal.
During the financial year, the Company has paid premiums of
US$38,789 to insure the Directors and Officers against certain
liabilities arising out of the conduct of acting as an officer of
the Company. Under the terms and conditions of the insurance
contract, the nature of liabilities insured against and the premium
paid cannot be disclosed.
Meetings of Directors
During the financial year, four meetings of the board of
directors were held. Attendances by each director during the year
were as follows:
Director Board Meetings
Eligible to Attended
attend
============ =========
Zhiwei Gu 4 2
============ =========
Yan Liu (resigned 10 December 2018) 3 3
============ =========
Juan Wang 4 2
============ =========
Lubing Liu 4 4
============ =========
Yi Zeng (resigned 27 November 2018) 3 3
============ =========
Mu Luo (appointed 11 January 2019) 1 1
============ =========
Proceedings on behalf of the company
No person has applied for leave of Court to bring proceedings on
behalf of the Company or to intervene in any proceedings to which
the Company is a party for the purpose of taking responsibility on
behalf of the Company for all or any part of those proceedings.
The Company was not a party to any such proceedings during the
year.
Corporate governance
In recognising the need for the highest standards of corporate
behaviour and accountability, the Directors of Range Resources
Limited support and have adhered to the principles of sound
corporate governance. The Board recognises the recommendations of
the Australian Securities Exchange Corporate Governance Council,
and considers that the Company complies to the extent possible with
those guidelines, which are of importance to the commercial
operation of a junior listed company.
During the financial year, shareholders continued to receive the
benefit of an efficient and cost-effective corporate governance
policy for the Company. The Company has established a set of
corporate governance policies and procedures which can be found,
along with the Company's Corporate Governance Statement, on the
Company's website: www.rangeresources.co.uk.
Non-audit services
The total value of non-audit services provided by a related
practice of BDO Audit (WA) Pty Ltd in respect to the Company's tax
compliance is US$15,500 (2018: US$17,010).
The board of directors has considered the position and is
satisfied that the provision of the non-audit services is
compatible with the general standard of independence for auditors
imposed by the Corporations Act 2001. The directors are satisfied
that the provision of non-audit services by the auditor did not
compromise the auditor independence requirements of the
Corporations Act 2001 for the following reasons:
1. all non-audit services have been reviewed by the Board to
ensure they do not impact the impartiality and objectivity of the
auditor; and
2. none of the services undermine the general principles
relating to auditor independence as set out in APES 110 Code of
Ethics for Professional Accountants.
+ Remuneration Report (Audited)
Remuneration policy
The remuneration policy of Range has been designed to align
director and executive objectives with shareholder and business
objectives by providing a fixed remuneration component and offering
specific long-term incentives based on key performance areas
affecting the Group's financial results. The Board of Range
Resources Limited believes the remuneration policy to be
appropriate and effective in its ability to attract and retain the
best executives and directors to run and manage the Group, as well
as create alignment of goals between directors, executives and
shareholders.
The Board's policy for determining the nature and amount of
remuneration for Board members and senior executives of the Company
is as follows:
The remuneration policy, setting the terms and conditions for
the executive directors and other senior executives, was developed
and approved by the Board.
Non-executive directors, executive directors and senior
executives receive a base salary (which is based on factors such as
length of service and experience), which is calculated on a total
cost basis and includes any FBT charges related to employee
benefits including motor vehicles, as well as employer
contributions to superannuation funds where applicable.
Executive and non-executive directors can be employed by the
Company on a consultancy basis on Board approval, with remuneration
and terms stipulated in individual consultancy agreements.
The Board exercises its discretion in determining remuneration
performance of executives. Given the size and nature of the entity,
the Board does not deem it to be realistic to measure performance
against defined criteria. As such remuneration and performance have
historically not been linked.
All remuneration paid to directors and executives is valued at
the cost to the Company and expensed. Shares given to directors and
executives are valued as the difference between the market price of
those shares and the amount paid by the director or executive.
Unlisted options are valued using the Black-Scholes
methodology.
The Board policy is to remunerate non-executive directors at
market rates for comparable companies taking into consideration
time, commitment and level of responsibility. As approved by
shareholders on 30 November 2011, the aggregate non-executive
remuneration per annum is currently A$350,000 (US$260,555). Fees
for non-executive directors are not linked to the performance of
the Group. The directors are not required to hold any shares in the
Company under the Constitution of the Company; however, to align
directors' interests with shareholder interests, the directors are
encouraged to hold shares in the Company.
Options may be issued to directors and executives as part of
remuneration. Options issued to directors historically were not
based on performance criteria. However, the options issued to the
current directors on 27 March 2015 and the Key Management Personnel
on 1 September 2015 and November 2016, principally vest upon
satisfaction of set company performance criteria detailed in Note
29.
Under the Company's share trading policy, all employees and
directors of the Company and its related companies are prohibited
from trading in the Company's shares or other securities if they
are in possession of inside information.
The Board believes that it has implemented suitable practices
and procedures that are appropriate for an organisation of this
size and maturity.
Company performance, shareholder wealth and directors and
executive's remuneration
No relationship exists between shareholder wealth, director and
executive remuneration and Company performance.
Voting and comments made at the company's 2018 Annual General
Meeting
Range Resources Limited received 98% of "yes" votes on its
remuneration report for the 2018 financial year. The Board believes
that this reflects the conservative remuneration practices of the
company.
Key Management Personnel
Name Position Appointed/Resigned
Mr Zhiwei Gu Non-Executive Chairman appointed 25 May 2016,
resigned 10 December 2018.
Executive Chairman appointed 10 December
2018
========================= ==============================
Mr Yan Liu Executive Director, appointed 25 May 2016,
Chief Executive Officer resigned 10 December 2018
========================= ==============================
Ms Juan Wang Non-Executive Director appointed 30 November
2014, resigned 22 July
2019
========================= ==============================
Mr Lubing Liu Executive Director, appointed 1 March 2018
Chief Operating Officer
and Trinidad General
Manager
========================= ==============================
Dr Yi Zeng Non-Executive Director appointed 16 June 2016,
resigned 27 November 2018
========================= ==============================
Mr Nick Beattie CFO & Company Secretary appointed 23 May 2014
(as CFO) and 30 March
2015 (as Company Secretary),
resigned 31 March 2019
========================= ==============================
Dr Mu Luo Non-Executive Director appointed 11 January 2019
========================= ==============================
Details of remuneration
The remuneration for the Key Management Personnel of the Group
during the year was as follows:
2019 Short Term Benefits Post-employment Share Total
benefits based
payments
Cash salary One-off Termination Super annuation Options
& fees payment benefits / pensions
============ ========= ============ ================ ==========
Currency US$ US$ US$ US$ US$ US$
============ ========= ============ ================ ========== ========
Directors & Officers
Mr Gu (i) 250,000 58,333 - - (12,386) 295,947
============ ========= ============ ================ ========== ========
Mr Y Liu 81,459 - - 10,666 (31,044) 61,081
============ ========= ============ ================ ========== ========
Ms Wang 25,000 - - - (6,440) 18,560
============ ========= ============ ================ ========== ========
Mr L Liu
(ii) 154,164 - - 13,619 - 167,783
============ ========= ============ ================ ========== ========
Dr Zeng 10,417 - - - - 10,417
============ ========= ============ ================ ========== ========
Mr Beattie 177,165 28,823 - 13,103 (22,758) 196,333
============ ========= ============ ================ ========== ========
Dr Luo 11,828 - - - - 11,828
============ ========= ============ ================ ========== ========
Total 710,033 87,156 - 37,388 (72,628) 761,949
============ ========= ============ ================ ========== ========
(i) Fees paid to Mr Gu comprised US$30,000 received in his
capacity as a non-executive director, US$25,000 in his role as
Chairman and US$253,333 for additional consulting work.
(ii) Fees paid to Mr L Liu comprised US$7,700 received for
additional consulting work, US$6,350 benefits in kind and salary of
US$140,114 in his capacity as Chief Operating Officer.
2018 Short Term Benefits Post-employment Share Total
benefits based
payments
Cash salary One-off Termination Super annuation Options
& fees payment benefits / pensions
============ ========= ============ ================ ==========
Currency US$ US$ US$ US$ US$ US$
============ ========= ============ ================ ========== ========
Directors & Officers
Mr Gu (i) 250,000 - - - (12,990) 237,010
============ ========= ============ ================ ========== ========
Mr Y Liu 166,685 - - 16,669 (32,009) 151,345
============ ========= ============ ================ ========== ========
Ms Wang
(ii) 141,250 - - - (10,853) 130,397
============ ========= ============ ================ ========== ========
Mr L Liu
(iii) 88,688 - - 4,920 - 93,608
============ ========= ============ ================ ========== ========
Dr Zeng 25,000 - - - - 25,000
============ ========= ============ ================ ========== ========
Mr Beattie 181,477 - - 18,148 (27,373) 172,252
============ ========= ============ ================ ========== ========
Mr Xiu (iv) 31,747 - - - (760) 30,987
============ ========= ============ ================ ========== ========
Mr Yu Wang - - - - - -
(v)
============ ========= ============ ================ ========== ========
Total 884,847 - - 39,737 (83,985) 840,599
============ ========= ============ ================ ========== ========
(i) Fees paid to Mr Gu comprised US$30,000 received in his
capacity as a non-executive director, US$25,000 in his role as
Chairman and US$195,000 for additional consulting work.
(ii)Fees paid to Ms Wang comprised US$28,750 received in her
capacity as a non-executive director and US$112,500 received for
additional consulting work.
(iii) Fees paid to Mr L Liu comprised US$16,667 received in his
capacity as a non-executive director, US$37,340 received for
additional consulting work and salary of US$39,601 in his capacity
as Chief Operating Officer.
(iv) Fees paid to Mr Xiu comprised US$31,747 received in his
capacity as a Vice President of Operations and Production.
(v) Mr Yu Wang tendered his resignation as Non-Executive
Director effective 26 September 2017.
Equity instrument disclosures relating to Key Management
Personnel
Share-based payments (year ended 30 June 2019)
No options were issued to key management personnel. The expense
reversal is due to the change in the probability of meeting the
vesting conditions prior to the options expiring as explained
below:
-- Probability of meeting the 1,500 barrels of oil per day for a
continuous 15-day period in Trinidad vesting condition is 0%;
-- Probability of meeting the 2,500 barrels of oil per day for a
continuous 15-day period in Trinidad vesting condition is 0%;
and
-- Probability of meeting the 4,000 barrels of oil per day for a
continuous 15-day period in Trinidad vesting condition is 0%.
Share-based payments (year ended 30 June 2018)
No options were issued to key management personnel. The expense
reversal is due to the change in the probability of meeting the
vesting conditions prior to the options expiring as explained
below:
-- Probability of meeting the 1,500 barrels of oil per day for a
continuous 15-day period in Trinidad vesting condition is 100%;
-- Probability of meeting the 2,500 barrels of oil per day for a
continuous 15-day period in Trinidad vesting condition is 0%;
and
-- Probability of meeting the 4,000 barrels of oil per day for a
continuous 15-day period in Trinidad vesting condition is 0%.
Fully paid share holdings
The numbers of shares in the Company held during the financial
year or at time of resignation by Key Management Personnel of the
Company, including their personally related parties, are set out
below.
2019 Balance Granted as Other Changes Balance Balance
at the start Compensation at the held indirectly
of the year end of
the year
Mr Gu 2,083,333 - - 2,083,333 -
============== ============== ============== =========== =================
Mr Y Liu 6,333,333 - - 6,333,333 -
============== ============== ============== =========== =================
Ms Wang 2,083,333 - - 2,083,333 -
============== ============== ============== =========== =================
Mr Wang - - - - -
============== ============== ============== =========== =================
Mr L Liu - - - - -
============== ============== ============== =========== =================
Dr Zeng - - - - -
============== ============== ============== =========== =================
Dr Luo - - - - -
============== ============== ============== =========== =================
Mr Beattie 2,916,667 - (2,916,667) - -
============== ============== ============== =========== =================
Total: 13,416,666 - (2,916,667) 10,499,999 -
============== ============== ============== =========== =================
Options held by Key Management Personnel
The numbers of options in the company held during the financial
year or at time of resignation by Key Management Personnel of the
Company, including their personally related parties, are set out
below:
2019 Balance Granted as Other Changes Balance Vested and
at the start Compensation at the end exercisable
of the year of the year
Mr Gu 30,000,000 - - 30,000,000 7,500,000
============= ============= ============= ============ ============
Mr Y Liu 30,000,000 - (30,000,000) - -
============= ============= ============= ============ ============
Ms Wang 7,500,000 - - 7,500,000 1,875,000
============= ============= ============= ============ ============
Mr L Liu - - - - -
============= ============= ============= ============ ============
Dr Zeng - - - - -
============= ============= ============= ============ ============
Dr Luo - - - - -
============= ============= ============= ============ ============
Mr Beattie 25,000,000 - (25,000,000) - -
============= ============= ============= ============ ============
Total: 92,500,000 - (55,000,000) 37,500,000 9,375,000
============= ============= ============= ============ ============
Loans to Key Management Personnel
There were no loans made to directors of Range and other Key
Management Personnel of the Group, including their personally
related parties during the 2018 or 2019 financial years. The
consulting fees paid to Zhiwei Gu and Lubing Liu were US$253,333
and US$7,700 respectively.
Employment contracts of Directors and other Key Management
Personnel
On appointment, Executive Directors and Other Key Management
Personnel enter into an employment contract with the Company (or
another company within the Group). This contract sets out their
duties, remuneration and other terms of employment. These contracts
may be terminated by either the Company or the employee as detailed
below.
All non-executive directors are eligible to receive consulting
fees for services provided to the Company over and above the
services expected from a non-executive director.
Mr Zhiwei Gu as Non-Executive Chairman
Non-Executive Chairman contract (resigned 10 December 2018)
Contract start 25 May 2016
date:
===================================================
Base Payment: US$55,000 per annum
===================================================
Superannuation: No superannuation entitlement
===================================================
Notice period: 3 months
===================================================
Termination benefits: Payment in lieu of notice at Company option
for termination without cause
===================================================
Consulting services: From May 2016, Mr Gu provides additional executive
and consulting services over and above services
rendered to the Company at a rate of US$16,250
per month
===================================================
Mr Zhiwei Gu as Executive Chairman
Executive Chairman contract (commenced 10 December 2018)
Contract start 10 December 2018
date:
===================================================
Base Payment: US$55,000 per annum
===================================================
Superannuation: No superannuation entitlement
===================================================
Notice period: 3 months
===================================================
Termination benefits: Payment in lieu of notice at Company option
for termination without cause
===================================================
Consulting services: Mr Gu provides additional executive and consulting
services over and above services rendered
to the Company at a rate of US$16,250 per
month
===================================================
Mr Yan Liu as Chief Executive Officer (resigned 10 December
2018)
Chief Executive Officer contract
Contract start 25 May 2016
date:
============================================
Base Payment: AU$215,000 per annum
============================================
Superannuation: 10% of base salary
============================================
Bonus: Eligible to receive bonus at the discretion
of the board
============================================
Notice period: 3 months
============================================
Termination benefits: Payment in lieu of notice at Company option
for termination without cause
============================================
Ms Juan Wang as Non-Executive Director
Non-Executive Director contract
Contract start 1 April 2018
date:
==============================
Base Payment: US$25,000 per annum
==============================
Superannuation: No superannuation entitlement
==============================
Termination benefits: None
==============================
Mr Lubing Liu as Chief Operating Officer, Trinidad General
Manager and Executive Director
Chief Operating Officer and Trinidad General Manger contract
Contract start 1 March 2018
date:
=============================
Base Payment: US$140,110 per annum
=============================
Superannuation: 10% of base
=============================
Notice period: 3 months
=============================
Termination benefits: 3 months' salary
=============================
Dr Yi Zeng as Non-Executive Director (resigned 27 November
2018)
Non-Executive Director contract
Contract start 16 June 2016
date:
==================================
Base Payment: US$25,000 per annum
==================================
Superannuation: No superannuation entitlement
==================================
Termination benefits: None
==================================
Mr Nick Beattie as Chief Financial Officer (resigned 31 March
2019)
Chief Financial Officer contract
Contract start 23 May 2014
date:
============================================
Base Payment: GBGBP135,000 per annum, reviewed annually
============================================
Pension: 10% of base
============================================
Bonus: Eligible to receive bonus at the discretion
of the board
============================================
Notice period: 3-6 months
============================================
Termination benefits: 6 months' salary
============================================
Dr Mu Luo as Non-Executive Director (appointed 11 January
2019)
Non-Executive Director contract
Contract start 11January 2019
date:
=================================
Base Payment: US$25,000 per annum
=================================
Superannuation: No superannuation entitlement
=================================
Termination benefits: None
=================================
Additional information
The earnings of the consolidated entity for the five years to 30
June 2019 are summarised below:
2019 2018 2017 2016 2015
$'000 $'000 $'000 $'000 $'000
---------- ---------- ---------- ---------- ----------
Sales revenue 12,357 13,059 8,435 7,062 13,153
---------- ---------- ---------- ---------- ----------
EBITDA (39,044) (6,000) (7,900) (5,658) (7,462)
---------- ---------- ---------- ---------- ----------
EBIT (43,002) (10,951) (14,189) (11,149) (12,379)
---------- ---------- ---------- ---------- ----------
Loss after
income tax (49,461) (17,530) (54,363) (43,875) (30,729)
---------- ---------- ---------- ---------- ----------
The factors that are considered to affect total shareholders
return ('TSR') are summarised below:
2019 2018 2017 2016 2015
$'000 $'000 $'000 $'000 $'000
-------- -------- -------- -------- --------
Share price
at financial
year end
(US$) 0.0004 0.002 0.004 0.005 0.01
-------- -------- -------- -------- --------
Total dividends
declared
(US$) - - - - -
-------- -------- -------- -------- --------
Basic earnings
per share
(US$) (0.48) (0.23) (0.70) (0.60) (0.59)
-------- -------- -------- -------- --------
Voting and comments made at the company's 2018 Annual General
Meeting
Range Resources Limited received 98% of "yes" votes on its
remuneration report for the 2018 financial year. The Board believes
that this reflects the conservative remuneration practices of the
company.
This is the end of the audited remuneration report.
Auditor's Independence Declaration
The auditor's independence declaration, as required under
Section 307C of the Corporations Act 2001, for the year ended 30
June 2019 has been received and can be found on the following
page.
This report is signed in accordance with a resolution of the
Board of Directors.
Zhiwei Gu: Chairman
27 September 2019
+ Auditor's Independence Declaration
<Intentionally left blank>
+ Consolidated Statement of Profit or Loss and other
Comprehensive Income for the year ended 30 June 2019
The below consolidated statement of profit or loss and other
comprehensive income should be read in conjunction with the
accompanying notes.
Note Consolidated
====================================== ==== ==========================
2019 (US$) 2018 (US$)
====================================== ==== ============ ============
Revenue from continuing operations 3 759,974 429,426
==== ============ ============
Operating expenses (794,867) (1,220,634)
==== ============ ============
Royalties - -
==== ============ ============
Depreciation, depletion and
amortisation (2,464,926) (3,703,963)
==== ============ ============
Cost of sales 4a (3,259,793) (4,924,597)
==== ============ ============
Gross loss (2,499,819) (4,495,171)
==== ============ ============
Other income and expenses from continuing operations
Other income 3 2,936 422,188
==== ============ ============
Finance costs 4b (5,803,077) (2,487,202)
==== ============ ============
General and administration expenses 4c (2,103,250) (3,434,629)
==== ============ ============
Exploration expenditure and
land fees 4d (1,302,346) (1,946,306)
==== ============ ============
Impairment of non-current assets 5 (8,362,271) -
==== ============ ============
Loss before income tax expense
from continuing operations (20,067,827) (11,941,120)
==== ============ ============
Income tax expense 6 (4,305,605) 903,227
==== ============ ============
Loss after income tax expense
from continuing operations (24,373,432) (11,037,893)
==== ============ ============
Loss from discontinued operations,
net of tax 7c (25,087,323) (6,492,344)
==== ============ ============
Loss for the year attributable
to equity holders of Range Resources
Limited (49,460,755) (17,530,237)
==== ============ ============
Other comprehensive income
Items that may be reclassified
to profit or loss
==== ============ ============
Exchange differences on translation
of foreign operations 25c 3,091,241 (1,423,892)
==== ============ ============
Other comprehensive inflow/(loss)
for year, net of tax 3,091,241 (1,423,892)
==== ============ ============
Total comprehensive loss attributable
to equity holders of Range Resources
Limited (46,369,514) (18,954,129)
==== ============ ============
Loss per share from continuing operations attributable to the
ordinary equity holders of the Company:
Basic gain/(loss) per share
(cents per share) 9a (0.24) (0.15)
==== ============ ============
Diluted loss per share (cents 9b n/a n/a
per share)
==== ============ ============
Loss per share from discontinuing operations attributable to
the ordinary equity holders of the Company:
Basic loss per share (cents
per share) 9a (0.48) (0.08)
==== ============ ============
Diluted loss per share (cents 9b n/a n/a
per share)
==== ============ ============
+ Consolidated Statement of Financial Position as at 30 June
2019
The below consolidated statement of financial position should be
read in conjunction with the accompanying notes.
Note Consolidated
==================================== ===== ============================
2019 (US$) 2018 (US$)
==================================== ===== ============= =============
Assets
Current Assets
Cash and cash equivalents 10 880,681 3,945,683
===== ============= =============
Trade and other receivables 11 157,827 4,875,766
===== ============= =============
Inventory 12 959,304 3,277,096
===== ============= =============
Other current assets 12 34,208 3,054,911
===== ============= =============
Assets of disposal group classified
as held for sale 7a 83,609,947 -
===== ============= =============
Total current assets 85,641,967 15,153,456
===== ============= =============
Non-Current Assets
Trade and other receivables 11 - 2,251,384
===== ============= =============
Deferred tax asset - 13,517,531
===== ============= =============
Goodwill 14,15 - 3,241,472
===== ============= =============
Property, plant and equipment 16 23,009,704 25,489,614
===== ============= =============
Exploration assets 17 - 6,744,997
===== ============= =============
Producing assets 18 - 109,091,650
===== ============= =============
Total non-current assets 23,009,704 160,336,648
===== ============= =============
Total assets 108,651,671 175,490,104
===== ============= =============
Current liabilities
Trade and other payables 19 782,502 9,929,506
===== ============= =============
Current tax liabilities 19 17,472 246,917
===== ============= =============
Borrowings 20c 1,600,000 1,600,000
===== ============= =============
Option liability 20b - 33,345
===== ============= =============
Provisions 21 - 811,737
===== ============= =============
Liabilities directly associated
with assets classified as held
for sale 7b 59,071,174 -
===== ============= =============
Total current liabilities 61,471,149 12,621,505
===== ============= =============
Non-current liabilities
Trade and other payables 19 44,997,793 50,441,779
===== ============= =============
Borrowings 20 44,551,690 42,439,606
===== ============= =============
Deferred tax liabilities 22 - 64,761,942
===== ============= =============
Employee service benefits 23 324,742 731,350
===== ============= =============
Total non-current liabilities 89,874,225 158,374,677
===== ============= =============
Total liabilities 151,345,373 170,996,182
===== ============= =============
Net (liabilities)/assets (42,693,702) 4,493,922
===== ============= =============
Equity
Contributed equity 24 386,726,067 383,918,397
===== ============= =============
Reserves 25 27,806,287 24,822,953
===== ============= =============
Non-controlling interest 17 - 3,517,873
===== ============= =============
Accumulated losses (457,226,056) (407,765,301)
===== ============= =============
Total equity/deficit (42,693,702) 4,493,922
===== ============= =============
+ Consolidated Statement of Changes in Equity for the year ended
30 June 2019
The below consolidated statement of changes in equity should be
read in conjunction with the accompanying notes.
Note Contributed Accumulated Foreign Share-based Option Non-controlling Total equity
equity losses currency payment premium interests
translation reserve reserve
reserve
================ ==== =========== ============= =========== =========== ========== =============== ============
(US$) (US$) (US$) (US$) (US$) (US$)
================ ==== =========== ============= =========== =========== ========== =============== ============
Balance at
1 July 2017 383,918,397 (390,235,064) 5,765,112 8,516,837 12,057,362 - 20,022,644
==== =========== ============= =========== =========== ========== =============== ============
Other
comprehensive
income - - (1,423,892) - - - (1,423,892)
==== =========== ============= =========== =========== ========== =============== ============
Profit
attributable
to members
of the company (11,037,893) (11,037,893)
==== =========== ============= =========== =========== ========== =============== ============
Loss from
discontinued
operations - (6,492,344) - - - - (6,492,344)
==== =========== ============= =========== =========== ========== =============== ============
Total
comprehensive
loss for the
year - (17,530,237) (1,423,892) - - - (18,954,129)
==== =========== ============= =========== =========== ========== =============== ============
Transactions with owners in their capacity as owners:
Issue of share - - - - - - -
capital
==== =========== ============= =========== =========== ========== =============== ============
Cost of
share-based
payments 4 - - - (92,466) - - (92,466)
==== =========== ============= =========== =========== ========== =============== ============
Non-controlling
interests on
acquisition
of subsidiary 17 - - - - - 3,517,873 3,517,873
==== =========== ============= =========== =========== ========== =============== ============
Balance at
30 June 2018 383,918,397 (407,765,301) 4,341,220 8,424,371 12,057,362 3,517,873 4,493,922
==== =========== ============= =========== =========== ========== =============== ============
Balance at
1 July 2018 383,918,397 (407,765,301) 4,341,220 8,424,371 12,057,362 3,517,873 4,493,922
Other comprehensive
income - - 3,091,241 - - - 3,091,241
=========== ============= ========= ========= ========== =========== ============
Loss attributable
to members
of the company - (24,373,432) - - - - (24,373,432)
=========== ============= ========= ========= ========== =========== ============
Loss from discontinued
operations - (25,087,323) - - - - (25,087,323)
=========== ============= ========= ========= ========== =========== ============
Total comprehensive
loss for the
year - (49,460,755) 3,091,241 - - - (46,369,514)
=========== ============= ========= ========= ========== =========== ============
Transactions with owners in their capacity as owners:
Issue of share
capital 24 2,807,670 - - - - - 2,807,670
=========== ============= ========= ========= ========== =========== ============
Cost of share-based
payments 4 - - - (107,907) - - (107,907)
=========== ============= ========= ========= ========== =========== ============
Non-controlling
interests 17 - - - - - (3,517,873) (3,517,873)
=========== ============= ========= ========= ========== =========== ============
Balance at
30 June 2019 386,726,067 (457,226,056) 7,432,461 8,316,464 12,057,362 - (42,693,702)
=========== ============= ========= ========= ========== =========== ============
+ Consolidated Statement of Cash Flows for the year ended 30
June 2019
The below consolidated statement of cashflows should be read in
conjunction with the accompanying notes
Note Consolidated
--------------------------------------- ------ --------------------------
2019 (US$) 2018 (US$)
--------------------------------------- ------ ------------ ------------
Cash flows from operating activities
Receipts from customers 8,184,780 6,580,150
------ ------------ ------------
Payments to suppliers and employees (9,832,657) (9,868,121)
------ ------------ ------------
Income taxes (paid)/received (1,019,231) 1,954,339
------ ------------ ------------
Interest (paid)/received (8,780) 115,477
------ ------------ ------------
Payment for exploration expenditure - -
------ ------------ ------------
Net cash outflow from operating
activities 28 (2,675,888) (1,218,155)
------ ------------ ------------
Cash flows from investing activities
Cash acquired on business combination 14(a) - 357,940
------ ------------ ------------
Payment for property, plant &
equipment (328,868) (254,088)
------ ------------ ------------
Payments for exploration and
evaluation expenditure (617,173) (1,253,329)
------ ------------ ------------
Acquisitions 17(i) - (2,560,000)
------ ------------ ------------
Proceeds from disposal of property,
plant and equipment 121,976 19,061
------ ------------ ------------
Payments for loan to external
parties - (4,047,630)
------ ------------ ------------
Net cash outflow from investing
activities (824,065) (7,738,046)
------ ------------ ------------
Cash flows from financing activities
Receipts from share issue 1,294,181 -
------ ------------ ------------
Interest and other finance income 154,115 -
------ ------------ ------------
Payment to LandOcean 12 - (2,800,000)
------ ------------ ------------
Repayment of borrowings - convertible
note interest 20 - (1,600,000)
------ ------------ ------------
Net cash inflow/(outflow) from
financing activities 1,448,296 (4,400,000)
------ ------------ ------------
Net decrease in cash and cash
equivalents (2,051,658) (13,356,201)
Net foreign exchange differences (46,204) 47,524
------- ------------ -------------
Cash and cash equivalents at
beginning of financial year 3,945,683 17,254,360
------- ------------ -------------
Cash and cash equivalents at
end of financial year 10 880,681 3,945,683
------- ------------ -------------
Classified as held for sale 7a, 7c 967,140 -
------- ------------ -------------
+ Notes to Consolidated Financial Statements
Note 1: Significant accounting policies
These financial statements are general purpose financial
statements that have been prepared in accordance with Australian
Accounting Standards, Australian Accounting Interpretations, other
authoritative pronouncements of the Australian Accounting Standards
Board and the Corporations Act 2001. Range Resources Limited is a
for-profit entity for the purpose of preparing the financial
statements.
The financial statements cover the Group consisting of Range
Resources Limited and its controlled entities. Financial
information for Range Resources Limited as an individual entity is
disclosed in Note 31. Range Resources Limited is a listed public
company, incorporated and domiciled in Australia.
The following is a summary of the material accounting policies
adopted by the Group in the preparation of the financial
statements. The accounting policies have been consistently applied,
unless otherwise stated. The financial report was authorised for
issue by the Directors on 27 September 2019.
Basis of preparation
Historical cost convention
The financial statements have been prepared under the historical
cost convention, except for, where applicable, the revaluation of
financial assets and liabilities at fair value through profit or
loss, financial assets at fair value through other comprehensive
income, investment properties, certain classes of property, plant
and equipment and derivative financial instruments.
Compliance with IFRS
The financial statements of Range Resources Limited also comply
with International Financial Reporting Standards (IFRS) as issued
by the International Accounting Standards Board (IASB). The
financial statements were approved by the Board of Directors on 27
September 2019.
Functional and presentation currency
Items included in the financial statements of each of the
Group's entities are measured using the currency of the primary
economic environment in which the entity operates (the "Functional
Currency"). The consolidated financial statements are presented in
United States Dollars (USD), which is Range Resources Limited's
functional and presentation currency.
Going concern
This report has been prepared on the going concern basis, which
contemplates the continuity of normal business activity and the
realisation of assets and settlement of liabilities in the normal
course of business.
For the year ended 30 June 2019 the Group recorded a loss of
US$46,283,298 (2018: US$17,530,237) and had net cash outflows of
US$2,051,658 (2018: cash outflows of US$13,356,201).
The ability of the Group to continue as a going concern is
dependent on securing additional funding through the issue of
shares and/or debt to fund its activities and the conclusion of the
sale of Range Resources Trinidad Limited to LandOcean as described
in Note 7 which will subsequently result to its debt
restructuring.
These conditions indicate a material uncertainty that may cast a
significant doubt about the Group's ability to continue as a going
concern and, therefore, it may be unable to realise its assets and
discharge its liabilities in the normal course of business.
On 19 September 2019 the Group completed a subscription
agreement to raise GBP750,000 which will provide the flexibility
for additional working capital. At the reporting date, Range had
US$880,861 of unrestricted cash at bank.
Management believe there are sufficient funds to meet the
Group's working capital requirements as at the date of this
report.
The Company is currently seeking other opportunities to further
expand its operations in other geographic locations.
Should the Company not be able to continue as a going concern,
it may be required to realise its assets and discharge its
liabilities other than in the ordinary course of business, and at
amounts that differ from those stated in the financial statements.
The financial report does not include any adjustments relating to
the recoverability and classification of recorded asset amounts or
liabilities that might be necessary should the Company not continue
as a going concern.
New and amended standards adopted by the Group
The Group has applied the following standards for the first time
for their reporting period commencing 1 July 2018:
-- AASB 9 Financial Instruments ("AASB 9"); and
-- AASB 15 Revenue from Contracts with Customers ("AASB 15").
AASB 9 financial instruments
-- AASB 9 Financial Instruments replaces the provisions of AASB
139 Financial Instruments: Recognition and Measurement that relate
to the recognition, classification and measurement of financial
assets and financial liabilities, derecognition of financial
instruments, impairment of financial assets and hedge accounting;
and
-- The adoption of AASB 9 Financial Instruments from 1 July 2018
resulted in changes in accounting policies but did not give rise to
any material transitional adjustments. The new accounting policies
(applicable from 1 July 2018) are set out below.
Classification and measurement
Except for certain trade receivables the Group initially
measures a financial asset at its fair value plus, in the case of a
financial asset not at fair value through profit or loss,
transaction costs.
Under AASB 9 financial assets are subsequently measured at fair
value through profit or loss (FVPL), amortised cost, or fair value
through other comprehensive income (FVOCI). The classification is
based on two criteria: the Group's business model for managing the
assets; and whether the instruments' contractual cash flows
represent 'solely payments of principal and interest' on the
principal amount outstanding (the 'SPPI criterion').
The new classification and measurement of the Group's financial
assets are, as follows:
-- Debt instruments at amortised cost, for financial assets that
are held within a business model with the objective to hold the
financial assets in order to collect contractual cash flows that
meet the 'SPPI criterion'. This category includes the Group's trade
and other receivables and long term other receivables; and
-- Financial assets at FVPL comprise debt instruments whose cash
flow characteristics fail the SPPI criterion or are not held within
a business model whose objective is either to collect contractual
cash flows, or to both collect contractual cash flows and sell.
On transition to AASB 9 the assessment of the Group's business
models was made as of the date of initial application, 1 July 2018.
The assessment of whether contractual cash flows on debt
instruments are solely comprised of principal and interest was made
based on the facts and circumstances as at the initial recognition
of the assets.
Impairment
From 1 July 2018 the group assesses on a forward looking basis
the expected credit losses (ECLs) associated with its debt
instruments carried at amortised cost. ECLs are based on the
difference between the contractual cash flows due in accordance
with the contract and all the cash flows that the Group expects to
receive. The shortfall is then discounted at an approximation to
the asset's original effective interest rate.
For trade receivables the group has applied the standard's
simplified approach and has calculated ECLs based on lifetime
expected credit losses. The Group has established a provision
matrix that is based on the Group's historical credit loss
experience, adjusted for forward-looking factors specific to the
debtors and the economic environment.
For long term receivables, the ECL is based on either the
12-month or lifetime ECL. The 12-month ECL is the portion of
lifetime ECLs that results from default events on a financial
instrument that are possible within 12 months after the reporting
date. When there has been a significant increase in credit risk
since origination, the allowance will be based on the lifetime ECL.
In all cases, the Group considers that there has been a significant
increase in credit risk when contractual payments are more than 90
days past due.
The Group considers a financial asset in default when
contractual payment are 180 days past due. However, in certain
cases, the Group may also consider a financial asset to be in
default when internal or external information indicates that the
Group is unlikely to receive the outstanding contractual amounts in
full before taking into account any credit enhancements held by the
Group.
On the above basis, the results of applying the ECL was not
material and no loss allowance was recognised.
AASB 15 revenue from contracts with customers
The Group has adopted AASB 15 with a date of initial application
of 1 July 2018. As a result of adoption of AASB 15, the Group has
changed its accounting policy for revenue recognition as detailed
below:
Revenue is measured based on the consideration specified in a
contract with a customer and excludes amounts collected on behalf
of third parties. The Group recognises revenue when it transfers
control over a product or service to a customer.
Impact of adoption of AASB 15
The Group has determined that the application of AASB 15's
requirements at transition 1 July 2018 did not result in any
adjustment.
(a) Principles of consolidation
The consolidated financial statements incorporate the assets and
liabilities of all subsidiaries of Range Resources Limited ("Parent
Entity" or "Company") as at 30 June 2019 and the results of all
subsidiaries for the year then ended. Range Resources Limited and
its subsidiaries together are referred to as the "Group".
Subsidiaries are all those entities (including special purpose
entities) over which the Group has control. The Group controls an
entity when the Group is exposed to, or has rights to, variable
returns from its investment with the entity and has the ability to
affect those returns through its power to direct the activities of
the entity.
Where controlled entities have entered or left the Group during
the year, their operating results have been included/excluded from
the date control was obtained or until the date control ceased. A
list of controlled entities is contained in Note 13 to the
financial statements. All controlled entities have a 30 June
financial year-end.
All inter-company balances and transactions between entities in
the Group, including any unrealised profits or losses have been
eliminated on consolidation. Accounting policies of subsidiaries
have been changed where necessary to ensure consistencies with
those policies applied by the Group.
Associates are all entities over which the Group has significant
influence but not control or joint control, generally accompanying
a shareholding of between 20-50% of the voting rights. Investments
in associates are accounted for in the consolidated financial
statements using the equity method of accounting, after initially
being recognised at cost.
(b) Income tax
The charge for current income tax expense is based on the profit
for the year adjusted for any non-assessable or disallowed items.
It is calculated using tax rates that have been enacted or are
substantively enacted by the reporting date within each
jurisdiction.
Deferred tax is accounted for using the liability method in
respect of temporary differences arising between the tax bases of
assets and liabilities and their carrying amounts in the financial
statements. No deferred income tax will be recognised from the
initial recognition of an asset or liability, excluding a business
combination, where there is no effect on accounting or taxable
profit or loss.
Deferred tax is calculated at the tax rates that are expected to
apply to the period when the asset is realised or the liability is
settled. Deferred tax is credited in profit or loss except where it
relates to items that may be credited directly to equity, in which
case the deferred tax is adjusted directly against equity.
Deferred income tax assets are recognised to the extent that it
is probable that future tax profits will be available against which
deductible temporary differences can be utilised.
Deferred tax liabilities and assets are not recognised for
temporary differences between the carrying amount and tax bases of
investments in foreign operations where the company is able to
control the timing of the reversal of the temporary differences and
it is probable that the differences will not reverse in the
foreseeable future.
Deferred tax assets and liabilities are offset when there is a
legally enforceable right to offset current tax assets and
liabilities and when the deferred tax balances relate to the same
taxation authority. Current tax assets and liabilities are offset
where the entity has a legally enforceable right to offset and
intends either to settle on a net basis, or to realise the asset
and settle the liability simultaneously.
Current and deferred tax is recognised in profit or loss, except
to the extent that it relates to items recognised in other
comprehensive income or directly in equity. In this case, the tax
is also recognised in other comprehensive income or directly in
equity, respectively.
The amount of benefits brought to account or which may be
realised in the future is based on the assumption that no adverse
change will occur in income taxation legislation and the
anticipation that the Group will derive sufficient future
assessable income to enable the benefit to be realised and comply
with the conditions of deductibility imposed by the law.
(c) Property, plant and equipment
Owned assets
Plant and equipment are measured on the historical cost basis
less accumulated depreciation and impairment losses.
The cost of fixed assets constructed within the Group includes
the cost of materials, direct labour, borrowing costs and an
appropriate proportion of fixed and variable overheads.
Subsequent costs are included in the asset's carrying amount or
recognised as a separate asset, as appropriate, only when it is
probable that future economic benefits associated with the item
will flow to the Group and the cost of the item can be measured
reliably. All other repairs and maintenance are charged to profit
or loss during the financial period in which they are incurred.
Oil and gas assets
These properties represent the accumulation of all exploration,
evaluation and development expenditure, pre-production development
costs and ongoing costs of continuing the develop reserves for
production incurred by or on behalf of the entity in relation to
areas of interests.
Where further development expenditure is incurred in respect of
a property after the commencement of production, such expenditure
is carried forward as part of the cost of that property only when
expected future economic benefits are to be received, otherwise
such expenditure is classified as part of the cost of
production.
Depreciation
The depreciable amount of all fixed assets including capitalised
lease assets is depreciated on a straight-line basis over their
useful lives to the Group commencing from the time the asset is
held ready for use. Leasehold improvements are depreciated over the
shorter of either the unexpired period of the lease or the
estimated useful lives of the improvements.
The depreciation rates used for each class of depreciable asset
are:
Class of fixed Asset Depreciation Rate
Plant & equipment 11.25% - 33%
==================
Production equipment 10 - 20%
==================
Motor vehicles, furniture &
fixtures 25 - 33%
==================
Leasehold improvements 10 - 12.50%
==================
The residual values of the assets and their useful lives are
reviewed and adjusted if appropriate at each reporting date.
The carrying amount of plant and equipment is reviewed annually
by the directors to ensure it is not in excess of the recoverable
amount from these assets. The recoverable amount is assessed on the
basis of the expected net cash flows which will be received from
the employment of the assets and subsequent disposal. The expected
net cash flows have been discounted to their present values in
determining recoverable amounts.
The carrying amount of the asset is written down to its
recoverable amount if its carrying amount is greater than its
estimated recoverable amount.
Gains and losses on disposals are determined by comparing
proceeds with the carrying amount. These gains or losses are
included in profit or loss. When revalued assets are sold, amounts
included in the revaluation reserve relating to that asset are
transferred to accumulated losses.
(d) Exploration and evaluation expenditure and the recognition
of assets
Acquisition costs for exploration and evaluation projects are
accumulated in respect of each identifiable area of interest. These
costs are only carried forward to the extent that they are expected
to be recouped through the successful development of the area or
where activities in the area have not yet reached a stage that
permits reasonable assessment of the existence of economically
recoverable reserves.
Accumulated costs in relation to an abandoned area are written
off in full against profit in the year in which the decision to
abandon the area is made.
A regular review is undertaken of each area of interest to
determine the appropriateness of continuing to carry forward costs
in relation to that area of interest.
The recoverability of the carrying amount of the exploration and
evaluation assets is dependent on the successful development and
commercial exploitation, or alternatively, sale of the respective
areas of interest.
The carrying values of expenditures carried forward are reviewed
for impairment at each reporting date when the facts, events or
changes in circumstances indicate that the carrying value may be
impaired.
Accumulated expenditures are written off to profit or loss to
the extent to which they are considered to be impaired.
The group applies AASB 6 Exploration and Evaluation of Mineral
Resources which is equivalent to IFRS 6. The carrying value of
exploration and evaluation expenditure is historical cost less
impairment.
Ongoing exploration costs incurred in respect of the Group's
Trinidadian and Indonesian interests are expensed as incurred.
Initial acquisition costs to obtain the right to explore are
capitalised.
(e) Producing assets
Upon the commencement of commercial production from each
identifiable area of interest, the exploration and evaluation
expenditure incurred up to that point is impairment tested and then
reclassified to producing assets.
When production commences, the accumulated costs for the
relevant area of interest are amortised on a "units of production"
method which is based on the ratio of actual production to
remaining proved and probable reserves (1P) as estimated by
independent petroleum engineers over the life of the area according
to the rate of depletion of the economically recoverable
reserves.
Subsequent costs such as workovers, are included in the carrying
amount of the asset only when it is probable that future economic
benefits associated with the item will flow to the Group and the
cost of the item can be reliably measured. All other costs are
charged to profit or loss during the financial period in which they
are incurred.
The carrying amount of producing assets is reviewed annually by
the directors to ensure it is not in excess of the recoverable
amount from these assets. The recoverable amount of an asset is the
greater of its fair value less costs to sell and its value in use.
In assessing value in use, the estimated future cash flows of an
asset are discounted to their present value using a post-tax
discount rate that reflects current market assessments of the time
value of money and the risks specific to the asset. Where an asset
does not generate cash flows that are largely independent from
other assets or groups of assets, the recoverable amount is
determined for the cash generating unit to which the asset belongs.
For producing assets, the estimated future cash flows for the
value-in-use calculation are based on estimates, the most
significant of which are 2P hydrocarbon reserves, future production
profiles, commodity prices, operating costs and any future
development costs necessary to produce the reserves which the group
is committed. Under a fair value less costs to sell calculation,
future cash flows are based on estimates of 2P hydrocarbon
reserves.
Estimates of future commodity prices are based on the Group's
best estimate of future market prices with reference to external
market analysts' forecasts, current spot prices and forward curves.
Future commodity prices are reviewed at least annually.
The carrying amount of an asset is written down to its
recoverable amount if its carrying amount is greater than its
estimated recoverable amount.
Gains and losses on disposals are determined by comparing
proceeds with the carrying amount. These gains or losses are
included in profit or loss. When revalued assets are sold, amounts
included in the revaluation reserve relating to that asset are
transferred to accumulated losses.
The Group records the present value of the estimated cost of
legal and constructive obligations to restore operating locations
in the period in which the obligation arises. The nature of
restoration activities includes the removal of facilities,
abandonment of wells and restoration of affected areas. A
restoration provision is recognised and updated at different stages
of the development and construction of a facility and then reviewed
on an annual basis. When the liability is initially recorded, the
estimated cost is capitalised by increasing the carrying amount of
the related exploration and evaluation/development assets.
Over time, the liability is increased for the change in the
present value based on a post-tax discount rate appropriate to the
risk inherent in the liability. The unwinding of the discount is
recorded as an accretion charge within finance costs. The carrying
amount capitalised in oil and gas properties is depreciated over
the useful life of the related asset.
Costs incurred that relate to an existing condition caused by
past operation and do not have a future economic benefit are
expensed.
(f) Financial instruments
The Group's financial instruments include cash and cash
equivalents, trade and other receivables and available-for-sale
financial assets.
The Group has adopted AASB 9 from 1 July 2018. The standard
introduced new classification and measurement models for financial
assets. A financial asset shall be measured at amortised cost if it
is held within a business model whose objective is to hold assets
in order to collect contractual cash flows which arise on specified
dates and that are solely principal and interest.
A debt investment shall be measured at fair value through other
comprehensive income if it is held within a business model whose
objective is to both hold assets in order to collect contractual
cash flows which arise on specified dates that are solely principal
and interest as well as selling the asset on the basis of its fair
value.
All other financial assets are classified and measured at fair
value through profit or loss unless the entity makes an irrevocable
election on initial recognition to present gains and losses on
equity instruments (that are not held-for-trading or contingent
consideration recognised in a business combination) in other
comprehensive income ('OCI').
Despite these requirements, a financial asset may be irrevocably
designated as measured at fair value through profit or loss to
reduce the effect of, or eliminate, an accounting mismatch. For
financial liabilities designated at fair value through profit or
loss, the standard requires the portion of the change in fair value
that relates to the entity's own credit risk to be presented in OCI
(unless it would create an accounting mismatch).
New simpler hedge accounting requirements are intended to more
closely align the accounting treatment with the risk management
activities of the entity. New impairment requirements use an
'expected credit loss' ('ECL') model to recognise an allowance.
Impairment is measured using a 12-month ECL method unless the
credit risk on a financial instrument has increased significantly
since initial recognition in which case the lifetime ECL method is
adopted. For receivables, a simplified approach to measuring
expected credit losses using a lifetime expected loss allowance is
available.
(g) Foreign currency transactions and balances
Functional and presentation currency
The functional currency of each entity within the Group is
determined using the currency of the primary economic environment
in which that entity operates.
Transaction and balances
Foreign currency transactions are translated into the functional
currency using the exchange rates prevailing at the date of the
transaction. Foreign currency monetary items are translated at the
year-end exchange rate. Non-monetary items measured at historical
cost continue to be carried at the exchange rate at the date of the
transaction.
Non-monetary items measured at fair value are reported at the
exchange rate at the date when fair values were determined.
Exchange differences arising on the translation of monetary
items are recognised in profit or loss
Exchange differences arising on the translation of non-monetary
items are recognised directly in equity to the extent that the gain
or loss is directly recognised in equity; otherwise the exchange
difference is recognised in profit or loss.
(h) Provisions
Provisions for legal claims, service warranties and make good
obligations are recognised when the Group has a present legal or
constructive obligation as a result of past events, it is probable
that an outflow of resources will be required to settle the
obligation and the amount has been reliably estimated. Provisions
are not recognised for future operating losses.
Where there are a number of similar obligations, the likelihood
that an outflow will be required in settlement is determined by
considering the class of obligations as a whole. A provision is
recognised even if the likelihood of an outflow with respect to any
one item included in the same class of obligations may be
small.
Provisions are measured at the present value of management's
best estimate of the expenditure required to settle the present
obligation at the reporting date. The discount rate used to
determine the present value reflects the current market assessments
of the time value of money and the risk specific to the liability.
The increase in the provision due to the passage of time is
recognised as interest expense.
(i) Cash and cash equivalents
Cash and cash equivalents include cash on hand, deposits held at
call with banks, other short-term highly liquid investments with
original maturities of three months or less that are readily
convertible to known amounts of cash and which are subject to
insignificant risk of changes in value, and bank overdrafts. Bank
overdrafts are shown within short-term borrowings in current
liabilities on the statement of financial position.
(j) Trade receivables
Trade receivables are initially recognised at fair value and
subsequently measured at amortised cost using the effective
interest method, less any allowance for expected credit losses.
Trade receivables are generally due for settlement within 30
days.
The consolidated entity has applied the simplified approach to
measuring expected credit losses, which uses a lifetime expected
loss allowance. To measure the expected credit losses, trade
receivables have been grouped based on days overdue.
Other receivables are recognised at amortised cost, less any
allowance for expected credit losses.
(k) Revenue recognition
The consolidated entity has adopted AASB 15 from 1 July 2018.
The standard provides a single comprehensive model for revenue
recognition. The core principle of the standard is that an entity
shall recognise revenue to depict the transfer of promised goods or
services to customers at an amount that reflects the consideration
to which the entity expects to be entitled in exchange for those
goods or services. The standard introduced a new contract-based
revenue recognition model with a measurement approach that is based
on an allocation of the transaction price. This is described
further in the accounting policies below. Credit risk is presented
separately as an expense rather than adjusted against revenue.
Contracts with customers are presented in an entity's statement of
financial position as a contract liability, a contract asset, or a
receivable, depending on the relationship between the entity's
performance and the customer's payment. Customer acquisition costs
and costs to fulfil a contract can, subject to certain criteria, be
capitalised as an asset and amortised over the contract period.
Revenue is recognised at an amount that reflects the
consideration to which the consolidated entity is expected to be
entitled in exchange for transferring goods or services to a
customer. For each contract with a customer, the Group identifies
the contract with a customer; identifies the performance
obligations in the contract; determines the transaction price which
takes into account estimates of variable consideration and the time
value of money; allocates the transaction price to the separate
performance obligations on the basis of the relative stand-alone
selling price of each distinct good or service to be delivered; and
recognises revenue when or as each performance obligation is
satisfied in a manner that depicts the transfer to the customer of
the goods or services promised.
Revenue from a contract to provide services is recognised over
time as the services are rendered based on either a fixed price or
an hourly rate.
Revenue from the sale of oil and gas and related products is
recognised when the Group
has transferred to the buyer the significant risks and rewards
of ownership and the
amounts can be measured reliably. In the case of oil, this
usually occurs at the time of lifting. Other revenue is recognised
when it is received or when the right to receive payment is
established.
(l) Goods and Services Tax (GST)
Revenues, expenses and assets are recognised net of the amount
of GST, except where the amount of GST incurred is not recoverable
from the Australian Tax Office. In these circumstances the GST is
recognised as part of the cost of acquisition of the asset or as
part of an item of the expense. Receivables and payables in the
statement of financial position are shown inclusive of GST.
Cash flows are presented in the consolidated statement of cash
flows on a gross basis, except for the GST component of investing
and financing activities, which are disclosed as operating cash
flows.
(m) Comparative figures
When required by Accounting Standards, comparative figures have
been adjusted to conform to changes in presentation for the current
financial year.
(n) Fair value estimation
The fair value of financial assets and financial liabilities
must be estimated for recognition and measurement for disclosure
purposes.
The fair value of financial instruments traded in active markets
(such as publicly traded derivatives, and trading and
available-for-sale securities) is based on quoted market prices at
the reporting date. The quoted market price used for financial
assets held by the Group is the current bid price.
The fair value of financial instruments that are not traded in
an active market (for example over-the-counter derivatives) is
determined using valuation techniques. The Group uses a variety of
methods and makes assumptions that are based on market conditions
existing at each reporting date.
The carrying value less impairment provision of trade
receivables and payables are assumed to approximate their fair
values due to their short-term nature. The fair value of financial
liabilities for disclosure purposes is estimated by discounting the
future contractual cash follows at the current market interest rate
that is available to the Group for similar financial
instruments.
(o) Investments in associates
Investments in associates are accounted for using the equity
method of accounting in the consolidated financial statements.
Under the equity method, the investment in the associate is
carried in the consolidated statement of financial position at cost
plus post-acquisition changes in the Group's share of net assets of
the associate.
After application of the equity method, the Group determines
whether it is necessary to recognise any additional impairment loss
with respect to the Group's net investment in the associate.
The Group's share of the associate post-acquisition profits or
losses is recognised in the statement of profit or loss and other
comprehensive income. The cumulative post-acquisition movements are
adjusted against the carrying amount of the investment. When the
Group's share of losses in the associate equals or exceeds its
interest in the associate, including any unsecured long-term
receivables and loans, the Group does not recognise further losses,
unless it has incurred obligations or made payments on behalf of
the associate.
The reporting dates of the associate and the Group are identical
and the associate's accounting policies conform to those used by
the Group for like transactions and events in similar
circumstances.
(p) Trade and other payables
These amounts represent liabilities for goods and services
provided to the Group prior to the end of financial year which are
unpaid. The amounts are unsecured and are usually paid within 30
days of recognition unless alternative terms are agreed. The
Group's most material balance is with LandOcean which has specific
payment terms of 3 years.
(q) Dividends
Provision is made for the amount of any dividend declared, being
appropriately authorised and no longer at the discretion of the
entity, on or before the end of the financial year but not
distributed at reporting date.
(r) Contributed equity
Ordinary shares are classified as equity. Incremental costs
directly attributable to the issue of new shares or options are
shown in equity as a deduction, net of tax, from the proceeds.
(s) Earnings per share
Basic earnings per share
Basic earnings per share is calculated by dividing the profit or
loss attributable to equity holders of the Company, excluding any
costs of servicing equity other than ordinary shares, by the
weighted average number of ordinary shares outstanding during the
financial year, adjusted for bonus elements in ordinary shares
issued during the year.
Diluted earnings per share
Diluted earnings per share adjusts the figures used in the
determination of basic earnings per share to take into account the
after income tax effect of interest and other financing costs
associated with dilutive potential ordinary shares.
(t) Segment reporting
Operating segments are reported in a manner consistent with the
internal reporting 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 Chief Executive Officer.
(u) Impairment of assets
Goodwill and intangible assets that have an indefinite useful
life are not subject to amortisation and are tested annually for
impairment, or more frequently if events or changes in
circumstances indicate that they might be impaired. Other assets
are tested for impairment whenever events or changes in
circumstances indicate that the carrying amount may not be
recoverable. An impairment loss is recognised for the amount by
which the asset's carrying amount exceeds its recoverable amount.
The recoverable amount is the higher of an asset's fair value less
costs to sell and value in use. For the purposes of assessing
impairment, assets are grouped at the lowest levels for which they
are separately identifiable cash inflows which are largely
independent of the cash inflows from other assets or groups of
assets (cash-generating units). Non-financial assets other than
goodwill that suffered an impairment are reviewed for possible
reversal of the impairment at the end of each reporting period.
(v) Intangible assets (goodwill)
Goodwill is measured at cost less any impairment write-downs.
Goodwill on acquisitions of subsidiaries is included in intangible
assets. Goodwill is not amortised but it is tested for impairment
annually or more frequently if events or changes in circumstances
indicate that it might be impaired, and is carried at cost less
accumulated impairment losses. Gains and losses on the disposal of
an entity include the carrying amount of goodwill relating to the
entity sold.
Goodwill is allocated to cash-generating units for the purpose
of impairment testing. The allocation is made to those
cash-generating units or groups of cash-generating units that are
expected to benefit from the business combination in which the
goodwill arose, identified according to operating segments (note
27).
(w) Share-based payments
The fair value of options granted is recognised as an expense
with a corresponding increase in equity. The total amount to be
expensed is determined by reference to the fair value of the
options granted, which includes any market performance conditions
and the impact of any non-vesting conditions but excludes the
impact of any service and non-market performance vesting
conditions.
(x) Employee benefits
Wages and salaries and annual leave
Liabilities for wages and salaries, including non-monetary
benefits are recognised in current liabilities in respect of
employees' services up to the reporting date and are measured at
the amounts expected to be paid when the liabilities are
settled.
Long service benefit
The liability for long service benefit is recognised in current
and non-current liabilities, depending on the unconditional right
to defer settlement of the liability for at least 12 months after
the reporting date. The liability is measured as the present value
of expected future payments to be made in respect of services
provided by employees up to the reporting date using the projected
unit credit method. Consideration is given to expected future wage
and salary levels, experience of employee departures and periods of
service.
(y) Leases
The determination of whether an arrangement is or contains a
lease is based on the substance of the arrangement and requires an
assessment of whether the fulfilment of the arrangement is
dependent on the use of a specific asset or assets and the
arrangement conveys a right to use the asset.
A distinction is made between finance leases, which effectively
transfer from the lessor to the lessee substantially all the risks
and benefits incidental to ownership of leased assets, and
operating leases, under which the lessor effectively retains
substantially all such risks and benefits.
Finance leases are capitalised. A lease asset and liability are
established at the fair value of the leased assets, or if lower,
the present value of minimum lease payments. Lease payments are
allocated between the principal component of the lease liability
and the finance costs, so as to achieve a constant rate of interest
on the remaining balance of the liability.
Leased assets acquired under a finance lease are depreciated
over the asset's useful life or over the shorter of the asset's
useful life and the lease term if there is no reasonable certainty
that the company will obtain ownership at the end of the lease
term.
Operating lease payments, net of any incentives received from
the lessor, are charged to profit or loss on a straight-line basis
over the term of the lease.
(z) Borrowings
Loans and borrowings are initially recognised at the fair value
of the consideration received, net of transaction costs. They are
subsequently measured at amortised cost using the effective
interest method.
Where there is an unconditional right to defer settlement of the
liability for at least 12 months after the reporting date, the
loans or borrowings are classified as non-current.
(aa) Compound financial instruments
Compound financial instruments issued by the Group comprise
convertible notes that can be converted to ordinary shares at the
option of the holder, when the number of shares to be issued is
fixed.
The liability component of a compound financial instrument is
recognised initially at the fair value of a similar liability that
does not have an equity conversion option. The equity component is
recognised initially at the difference between the fair value of
the compound financial instrument as a whole and the fair value of
the liability component. Any directly attributable transaction
costs are allocated to the liability and equity components in
proportion to their initial carrying amounts.
Subsequent to initial recognition, the liability component of a
compound financial instrument is measured at amortised cost using
the effective interest method. The equity component of a compound
financial instrument is not re-measured subsequent to initial
recognition.
Interest related to the financial liability is recognised in
profit or loss. On conversion the financial liability is
reclassified to equity and no gain or loss is recognised.
Convertible notes that can be converted to share capital at the
option of the holder and where the number of shares is variable,
contains an embedded derivative liability. The embedded derivative
liability is calculated (at fair value) first and the residual
value is assigned to the debt host contract. The embedded
derivative is subsequently measured at fair value and movements are
reflected in profit or loss.
Certain convertible notes issued by the Group which include
embedded derivatives (option to convert to variable number of
shares in the Group) are recognised as financial liabilities at
fair value through profit or loss. On initial recognition, the fair
value of the convertible note will equate to the proceeds received
and subsequently the liability is measured at fair value at each
reporting period until settlement. The fair value movements are
recognised in profit or loss as finance costs.
Finance costs attributable to qualifying assets are capitalised
as part of the asset. All other finance costs are expensed in the
period in which they are incurred.
(bb) Inventories
Inventories include consumable supplies and maintenance spares
and are valued at the lower of cost and net realisable value. Cost
is determined on a weighted average basis and includes direct costs
and an appropriate portion of fixed and variable production
overheads where applicable. Inventories determined to be obsolete
or damaged are written down to net realisable value, being the
estimated selling price less selling costs.
The directors evaluate estimates and judgements incorporated
into the financial statements based on historical knowledge and
best available current information. Estimates assume a reasonable
expectation of future events and are based on current trends and
economic data, obtained both externally and within the Group. Areas
involving a higher degree of judgement or complexity, or areas
where estimations and assumptions are significant to the financial
statements are disclosed here.
(cc) Non-current assets classified as held for sale
Non-current assets are classified as held for sale if their
carrying amount will be recovered principally through a sale
transaction rather than through continuing use. They are measured
at the lower of their carrying amount and fair value less costs to
sell. For non-current assets to be classified as held for sale,
they must be available for immediate sale in their present
condition and their sale must be highly probable.
An impairment loss is recognised for any initial or subsequent
write down of the non-current assets to fair value less costs to
sell. A gain is recognised for any subsequent increases in fair
value less costs to sell of a non-current asset, but not in excess
of any cumulative impairment loss previously recognised.
Non-current assets are not depreciated or amortised while they
are classified as held for sale. Interest and other expenses
attributable to the liabilities of assets held for sale continue to
be recognised.
Non-current assets classified as held for sale are presented
separately on the face of the consolidated statement of financial
position, in current assets. The liabilities of disposal groups
classified as held for sale are presented separately on the face of
the statement of financial position, in current liabilities.
Discontinued operations
A discontinued operation is a component of the Group's business,
the operations and cash flows of which can be clearly distinguished
from the rest of the Group and which:
-- represents a separate major line of business or geographical area of operations;
-- is part of a single co-ordinated plan to dispose of a
separate major line of business or geographical are of operations;
and
-- is a subsidiary acquired exclusively with a view to resale.
Classification as a discontinued operation occurs at the earlier
of disposal or when the operation meets the criteria to be
classified as held-for-sale.
When an operation is classified as a discontinued operation, the
comparative consolidated statement of profit or loss and other
comprehensive income is re-presented as if the operation had been
discontinued from the start of the comparative year.
Note 2: Critical accounting estimates and judgements
Non-current assets classified as held for sale and discontinued
operations
Towards the end of the financial year ended 30 June 2019, the
Group undertook a review of the oil and gas business culminating in
the decision to sell Range Resources Trinidad Limited to LandOcean.
The Board of Directors have judged that as a result of this review,
the assets and associated liabilities of Range Resources Trinidad
Limited should be classified as held for sale as at 30 June 2019
and all operations of Range Resources Trinidad to be classified as
discontinued. In reaching this judgement, the Board of Directors
have considered that the requirements of AASB 5: Non-current assets
held for sale and discontinued operations have been met.
Producing asset expenditure
The classification of exploration and evaluation expenditure to
producing assets is based on the time of first commercial
production. Producing asset expenditure for each area of interest
is carried forward as an asset provided certain conditions listed
in Note 1(e) are met and depreciated on a unit of production basis
on P1 reserves. P1 reserves have been determined by an independent
expert.
Producing assets are assessed for impairment when facts and
circumstances suggest that the carrying amount of a production
asset may exceed its recoverable amount. These timings,
calculations and reviews require the use of assumptions and
judgement. The related carrying amounts are disclosed in Note
18.
Reserves and resources
Estimates of reserves requires judgement to assess the size and
quality of reservoirs and their anticipated recoveries. Estimates
of reserves are used to calculate depreciation, depletion and
amortisation charges.
Impairment of goodwill and producing assets
The Group tests whether goodwill or the producing assets has
suffered any impairment in accordance with the accounting policies
stated in notes 1(e) and 1(u). The recoverable amount of the
cash-generating unit to which the assets belong is estimated based
on the present value of future cash flows.
The expected future cash flow estimation is always based on a
number of factors, variables and assumptions, the most important of
which are estimates of reserves, future production profiles,
commodity prices and costs. In most cases, the present value of
future cash flows is most sensitive to estimates of future oil
price and discount rates. A change in the modelled assumptions in
isolation could materially change the recoverable amount. Refer to
note 14 for details of these key assumptions.
Deferred tax liability
Upon acquisition of SOCA Petroleum Ltd in June 2011, in
accordance with the requirement of AASB 112 Income Taxes, a
deferred tax liability of US$46,979,878 was recognised in relation
to the difference between the carrying amount for accounting
purposes of deferred development assets and their actual cost base
for tax purposes.
The carrying value of this deferred tax liability is
US$3,177,457 at 30 June 2019. In the event that the manner by which
the carrying value of these assets is recovered differs from that
which is assumed for the purpose of this estimation, the associated
tax charges may be significantly less than this amount.
Recoverability of deferred tax assets
Deferred tax assets are recognised only if it is probable that
future taxable amounts will be available to utilise those temporary
differences and losses. Management considers that it is probable
that future taxable profits will be available to utilise those
temporary differences. Judgement is required to determine the
amount of deferred tax assets that can be recognised, based upon
the likely timing and the level of future profits.
Fair value of assets acquired and liabilities assumed in
business combination
Identifiable assets acquired and liabilities assumed in business
combination are measured at their fair values at the acquisition
date.
Share based payments transactions
The Group measures the cost of equity-settled share-based
payment transactions with employees by reference to the fair value
of the equity instruments at the grant date. The fair value is
determined using a Black-Scholes model. The accounting estimates
and assumptions relating to equity-settled share-based payments
would have no impact on the carrying amounts of assets and
liabilities within the next annual reporting period but may impact
expenses and derivative liability.
Contingent liabilities
The Directors are of the opinion that no provision is required
to be raised in respect to any of the matters disclosed in Note 26
as the likely outcome of any outflow is considered to be
remote.
Recoverability of capitalised exploration and evaluation
expenditure
The future recoverability of capitalised exploration and
evaluation expenditure is dependent on a number of factors,
including whether the Group decides to exploit the related lease
itself or, if not, whether it successfully recovers the related
exploration and evaluation asset through sale. Factors that could
impact the future recoverability include the level of reserves and
resources, future technological changes, which could impact the
cost of mining, future legal changes (including changes to
environmental restoration obligations) and changes to commodity
prices. To the extent that capitalised exploration and evaluation
expenditure is determined not to be recoverable in the future,
profits and net assets will be reduced in the period in which this
determination is made.
Accounting for Strait Oil & Gas Limited
Range owns 65% of the issued share capital of Strait Oil &
Gas Limited ("SOG"). This is achieved by interest through a 45%
shareholding held by Range itself plus a 20% shareholding through
its full ownership of Georgian Oil Pty Ltd. Despite owning a
majority of the issued share capital, management do not view this
as control and the principal rationale for that view is as
follows:
1. Range has no appointed directors of SOG so exercises no
effective control over the company. The sole director of SOG is a
different corporate entity;
2. All shareholders must agree to any termination of the
management agreement which governs the role of the appointed
director;
3. The Articles of Association of SOG are silent on the ability
of shareholders to appoint directors. To appoint a director,
management believe that the articles would need to be amended. To
amend the articles requires a special resolution which needs 75%
votes (Range only controls 65%) and management do not believe they
would get support from the other shareholders to do this;
In practice all decision making and corporate activities require
consent of all the shareholders resulting in Range have no
demonstrable control over SOG.
The Group therefore intends to continue to account for this as
an "Other Asset" with a carrying value equal to the US$20,000 which
was the cost of acquiring Georgian Oil Pty Ltd. All previous costs
incurred by Range in relation to SOG have been impaired and the
Company will continue to expense any ongoing expenses which are
incurred.
Allowance for expected credit losses
The allowance for expected credit losses assessment requires a
degree of estimation and judgement. It is based on the lifetime
expected credit loss, grouped based on days overdue, and makes
assumptions to allocate an overall expected credit loss rate for
each group. These assumptions include recent sales experience and
historical collection rates.
Rehabilitation provision
A provision has been made for the present value of anticipated
costs for future rehabilitation of land explored. The Group's
exploration activities are subject to various laws and regulations
governing the protection of the environment. The Group recognises
management's best estimate for assets retirement obligations and
site rehabilitations in the period in which they are incurred.
Actual costs incurred in the future periods could differ materially
from the estimates. Additionally, future changes to environmental
laws and regulations and discount rates could affect the carrying
amount of this provision.
Note 3: Revenue
Note Consolidated
-------------------------------------- ------ ------------------------
2019 (US$) 2018 (US$)
-------------------------------------- ------ ----------- -----------
From continuing operations
Revenue from services to third
parties recognised over time 759,974 429,426
----------- -----------
Total revenue from continuing
operations 759,974 429,426
----------- -----------
From discontinued operations
Revenue from sale of oil recognised
at a point in time 11,597,161 12,629,996
----------- -----------
Total revenue from discontinued
operations 11,597,161 12,629,996
----------- -----------
Other income from continuing operations
Interest income 2,936 422,188
----------- -----------
Total other income from continuing
operations 2,936 422,188
----------- -----------
Other income from discontinued operations
Interest income
----------- -----------
Other income 7,108 -
----------- -----------
Total other income from discontinued 7,108 -
operations
----------- -----------
Revenue from third party services and sale of oil is solely
generated in the Republic of Trinidad and Tobago.
Note 4: Expenses
Note Consolidated
---------------------------------------- ------ -------------------------
2019 (US$) 2018 (US$)
---------------------------------------- ------ ----------- ------------
a: Cost of sales - continuing operations
Costs of operations 794,867 1,220,634
------ ----------- ------------
Depreciation and amortisation 2,464,926 3,703,963
------ ----------- ------------
Total cost of sales from continuing
operations 3,259,793 4,924,597
------ ----------- ------------
a: Cost of sales - discontinued operations
Costs of production 1,917,217 5,468,124
------ ----------- ------------
Royalties 4,400,775 4,605,811
------ ----------- ------------
Staff costs 3,045,048 4,080,334
------ ----------- ------------
Depreciation and amortisation 1,493,021 1,246,702
------ ----------- ------------
Total cost of sales from discontinued
operations 10,856,061 15,400,971
------ ----------- ------------
b: Finance costs - continuing operations
Fair value movement of derivative
liability (383,894) (2,308,556)
------ ----------- ------------
Fair value movement of option
liability 20(b) (33,345) (308,273)
------ ----------- ------------
Foreign exchange loss 118,502 193,109
------ ----------- ------------
Interest expense 3,316,336 2,602,366
------ ----------- ------------
Interest on convertible note 2,785,478 2,308,556
------ ----------- ------------
Total finance costs from continuing
operations 5,803,077 2,487,202
------ ----------- ------------
b: Finance costs - discontinued operations
Interest expense 645,376 463,403
------ ----------- ------------
Foreign exchange loss 9,873 144,190
------ ----------- ------------
Total finance costs from discontinued
operations 655,249 607,593
------ ----------- ------------
-
---------------------------------------- ------ ----------- ------------
c: General and administration expenses - continuing operations
Directors' and officers' fees
and benefits 837,874 840,599
------ ----------- ------------
Share based payments - employee,
director and consultant options (107,907) (92,466)
------ ----------- ------------
Other expenses 1,373,283 2,686,496
------ ----------- ------------
Total general and administration
expenses from continuing operations 2,103,250 3,434,629
------ ----------- ------------
c: General and administration expenses - discontinued operations
Other expenses 1,106,200 668,083
------ ----------- ------------
Total general and administration
expenses from discontinued operations 1,106,200 668,083
------ ----------- ------------
d: Exploration expenditure - continuing operations
Indonesia (i) 617,173 1,253,329
---------- ----------
Trinidad (ii) 685,173 670,856
---------- ----------
Other - 22,121
---------- ----------
Total exploration expenditure
from continuing operations 1,302,346 1,946,306
---------- ----------
(i) Amounts expensed in the year in Indonesia relate to
exploration activities in the Perlak field for which the company
policy is to expense.
(ii) Amounts expensed in the year in Trinidad relate to land
fees in relation to St Mary's for which the company policy is to
expense.
Note 5: Impairment of non-current assets
Impairment testing was performed during the current half-year as
impairment indicators were identified and an impairment was
recorded. The impairment was due to a combination of lower assumed
long-term oil prices together with a deferred work programme. In
line with the announced work plans for 2019, Range was not
anticipating any material production growth during 2019 and when
updating the models for the revised production profiles it resulted
in a lower NPV. This was exacerbated by lower oil prices assumption
when compared to the impairment review in September 2018.
The long term WTI forward price has settled into a band of
between US$53 - US$55/bbl which is just above the level at which
Supplemental Petroleum Tax takes effect. This had a materially
negative impact on the NPV calculation and Range believes this
highlights the regressive nature of this particular tax. As a
result, a goodwill impairment of US$3,241,472 and Trinidad asset
impairment of US$48,079,057 were recorded. Impairment testing was
not performed at year-end, although impairment indicators were
identified, due to the fact that the book value of the producing
assets was supported by the consideration of the SPA signed between
the Group and LandOcean. Please refer to note 7 for further
information on the agreement.
Non-current receivables of US$2,284,398 were fully impaired as
they are not deemed recoverable. These relate to Sincep and
LandOcean Energy, refer to Note 11.
In Indonesia, despite continued efforts by the operator of the
project to establish stable and continuous production from the
field, no material production had been achieved from the work
programme to date. As a result, a decision was made to fully impair
the asset related to Indonesia exploration, which resulted to an
impairment of US$6,077,873.
Note 6: Income tax expense
Note Consolidated
--------------------------------------- ----- ----------------------------
2019 (US$) 2018 (US$)
--------------------------------------- ----- ------------- -------------
a: Income tax expense
Current tax - -
----- ------------- -------------
Deferred tax (26,602,649) 1,419,725
----- ------------- -------------
Adjustments for current tax
of prior periods 3,661,806 122,479
----- ------------- -------------
(22,940,843) 1,542,204
----- ------------- -------------
Income tax expense/(benefit) is attributable to:
Loss from continuing operations 4,305,605 -
----- ------------- -------------
Loss from discontinued operations (27,246,448) 1,542,204
----- ------------- -------------
Aggregate income tax (credit)/expense (22,940,843) 1,542,204
----- ------------- -------------
b: The prime facie tax on profit from ordinary activities
before income tax is reconciled to the income tax as follows:
Loss from continuing operations
before income tax (20,067,827) (11,941,120)
----- ------------- -------------
Loss from discontinuing operations
before income tax (52,333,771) (4,046,913)
----- ------------- -------------
(72,401,598) (15,988,033)
----- ------------- -------------
Prime facie tax (benefit) payable
on loss from ordinary activities
before income tax at 30% (2018:
30%) Group (21,720,479) (4,474,410)
----- ------------- -------------
(21,720,479) (4,796,410)
----- ------------- -------------
Add tax effect of:
Other taxes 2,863,914 88,626
----- ------------- -------------
Expenses not deductible for
tax 6,615,840 4,883,415
----- ------------- -------------
Tax losses not brought to account 10,305,814 11,316,449
----- ------------- -------------
Income not assessable for tax (3,781,594) -
----- ------------- -------------
Benefit of tax tax losses (2,822,802) -
not previously recognised
----- ------------- -------------
Expenses deductible for tax
purposes - (5,961,448)
----- ------------- -------------
Deferred tax assets not brought
to account 1,534,226 331,010
----- ------------- -------------
Differences in tax rates (15,935,762) (4,319,439)
----- ------------- -------------
(22,940,843) 1,542,204
----- ------------- -------------
Unrecognised deferred tax asset
Capital losses 498,254 443,654
----- ------------- -------------
Revenue losses 10,905,153 10,595,377
----- ------------- -------------
Other 4,381,634 2,866,987
----- ------------- -------------
Offset of deferred tax liabilites (8,292,796) (5,680,826)
----- ------------- -------------
Net Deferred Tax Assets not
brought to account 7,492,245 8,225,192
----- ------------- -------------
c: Recognised deferred tax assets
Temporary differences 7a 15,439,010 13,517,531
----- ------------- -------------
15,439,010 13,517,531
----- ------------- -------------
Recognised deferred tax liabilities
Accelerated depreciation (39,184,861) (36,332,757)
----- ------------- -------------
DTL arising on business combination (905,471) (28,429,185)
----- ------------- -------------
Net deferred tax liabilities (40,090,332) (64,761,942)
----- ------------- -------------
Deferred tax assets not brought to account, the benefits of
which will only be realised if the conditions for deductibility set
out in Note 1(b) occur.
Note 7: Discontinued operations
Towards the end of the financial year, the Group entered
negotiations with LandOcean to sell Range Resources Trinidad
Limited. On 2 September 2019, the parties have successfully signed
a binding conditional Sale and Purchase Agreement for the sale of
Range Resources Trinidad Limited to LandOcean in exchange for
offsetting all outstanding debt and payables (including the
convertible note) due from Range and its subsidiaries to LandOcean
and its subsidiaries, and a cash consideration of US$2,500,000. The
Board of Directors has decided that Range Resources Trinidad
Limited will be presented on the Statement of Financial Position as
held for sale as at 30 June 2019. Total debt and payables to be
offset, as at 30 June 2019, which does not form part of the assets
held for sale and associated liabilities are detailed below. The
interest on these balances was extrapolated to 31 December 2019
which is the anticipated date for the transaction to be
completed.
Debtor Creditor Amount (US$)
Agreement Regarding Amounts
Outstanding between the Purchaser
and RRDSL dated 30 November LandOcean
2017 RRDSL Energy Services 1,878,458
-------- ------------------------ -------------
Agreement Regarding Amounts
Outstanding between EPT and
RRDSL dated 30 November 2017 RRDSL EPT 1,306,958
-------- ------------------------ -------------
Agreement Regarding Amounts
Outstanding between GPN and
RRDSL dated 30 November 2017 RRDSL GPN 487,447
-------- ------------------------ -------------
Agreement Regarding Amounts
Outstanding between LOPCL and
RRDSL dated 30 November 2017 RRDSL LOPCL 22,167,122
-------- ------------------------ -------------
Agreement Regarding Amounts
Outstanding between CWUPET and
RRDSL dated 30 November 2017 RRDSL CWUPET 612,564
-------- ------------------------ -------------
Hong Kong
Fu Tong International
Purchase Order No. 9 in respect Petroleum
of the IMSC dated 31 January Technology
2018 RRL Ltd 553,012
-------- ------------------------ -------------
Letter Agreement to the IMSC
and Purchase Orders entered
into by the Purchaser, RRDSL,
CWUPET, and PST Service Corp.
(together as the Contractor)
and the Seller, Range Resources
GY Shallow Limited and the Company LandOcean
dated 6 April 2017 RRL Energy Services 45,045,913
-------- ------------------------ -------------
Sale and Purchase Agreement
between SOCA and LOPCL dated
27 April 2017 SOCA LOPCL 502,704
-------- ------------------------ -------------
Convertible note deed between
the Seller and the Purchaser LandOcean
date 31 December 2019 RRL Energy Services 21,600,000
-------- ------------------------ -------------
Grand total 94,154,178
-------------
Note 7a: Assets of disposal group classified as held for
sale
Note Consolidated
------------------------------- ------ ------------------------
2019 (US$) 2018 (US$)
------------------------------- ------ ----------- -----------
Current assets
Cash and cash equivalents 967,140 -
------ ----------- -----------
Trade and other receivables 4,320,067 -
------ ----------- -----------
Other current assets 2,064,575 -
------ ----------- -----------
Total current assets 7,351,782 -
------ ----------- -----------
Non-current assets
Deferred tax asset 15,439,010 -
------ ----------- -----------
Property, plant and equipment 1,159,235 -
------ ----------- -----------
Producing assets 58,986,034 -
------ ----------- -----------
Exploration assets 673,886
----------- -----------
Total non-current assets 76,258,165 -
----------- -----------
Total held for sale assets 83,609,947 -
----------- -----------
On 2 September 2019, Range and LandOcean successfully signed a
binding conditional Sale and Purchase Agreement for the sale of
Range Resources Trinidad Limited (disposal group classified as held
for sale) to LandOcean in exchange for offsetting all outstanding
debt and payables (including the convertible note) due from Range
and its subsidiaries to LandOcean and its subsidiaries, and a cash
consideration of US$2,500,000.
The first tranche of the cash consideration of US$500,000 is
payable upfront as deposit, US$1,000,000 to be paid within five
business days of the approval of the shareholders' meeting of
LandOcean (first payment) and US$1,000,000 to be paid within five
business days of the completion date (final payment).
The completion is subject to shareholder and government
approvals; Range's shareholder meeting to consider the Transaction
is planned for November 2019. The agreed long stop date for the
Transaction is 30 June 2020.
If the key conditions for completion are not satisfied by 30
June 2020, the deposit and the first payment (together with
interest accrued at 8% per annum) will be repaid to LandOcean. If
all conditions are satisfied but LandOcean chooses not to proceed
with completion for any reason, the Deposit and the First Payment
will be retained by Range.
Range will provide mortgages over its workover and swabbing rigs
as security, with such mortgages to be released upon completion or
termination of the SPA. This is to provide comfort to LandOcean in
case the key conditions for completion are not satisfied by 30 June
2020. The book value of the rigs mortgaged is US$1,539,370.
Note 7b: Liabilities directly associated with assets classified
as held for sale
Note Consolidated
--------------------------------- ----- ------------------------
2019 (US$) 2018 (US$)
--------------------------------- ----- ----------- -----------
Current liabilities
Trade and other payables 18,694,044 -
----- ----------- -----------
Deferred tax liabilities 22 40,090,332 -
----- ----------- -----------
Accrued expenditure 286,798 -
----- ----------- -----------
Total current liabilities 59,071,174 -
----- ----------- -----------
Total held for sale liabilities 59,071,174 -
----- ----------- -----------
Note 7c: Discontinued operations
The financial performance of Range Resources Trinidad Limited is
shown below.
Note Consolidated
-------------------------------------- ------ ---------------------------
2019 (US$) 2018 (US$)
-------------------------------------- ------ ------------- ------------
Financial Performance and cash flow information
Revenue from sale of oil 11,597,161 12,629,996
------------- ------------
Other income 7,108 -
------ ------------- ------------
Royalties (4,400,775) (4,605,811)
------------- ------------
Operating expenses (4,962,266) (9,548,458)
------------- ------------
Oil and gas properties depreciation,
depletion and amortisation (1,493,021) (1,246,702)
------------- ------------
Administrative expenses (1,106,200) (668,083)
------------- ------------
Impairment expense (51,320,529) -
------ ------------- ------------
Finance expenses (655,249) (607,593)
------------- ------------
Taxation (charge)/benefit 27,246,448 (2,445,693)
------------- ------------
Total loss after tax (25,087,323) (6,492,344)
------------- ------------
Net cash inflow from operating
activities 146,962 3,666,148
------------- ------------
Net cash outflow from investing
activities (206,893) (3,234,717)
------------- ------------
Net cash from financing activities 115,086 -
------ ------------- ------------
Net cash increase in cash generated
by the subsidiary 55,155 431,431
------------- ------------
Note 8: Auditor's remuneration
Note Consolidated
------------------------------------- ------ ------------------------
2019 (US$) 2018 (US$)
------------------------------------- ------ ----------- -----------
Remuneration of the auditor of the Parent Entity for:
Auditing or reviewing the financial
report by BDO Audit (WA) Pty
Ltd 68,000 56,016
----------- -----------
Non-audit services provided
by a related entity of BDO
Audit (WA) Pty Ltd in respect
to Parent Entity's tax compliance 15,500 17,010
----------- -----------
Professional services provided
by BDO UK LLP in respect to
AIM admission - 160,591
----------- -----------
Total remuneration for the
Parent Entity 83,500 233,617
----------- -----------
Remuneration of the auditors of the subsidiaries
Auditing or reviewing the financial
report by BDO UK 4,670 2,016
----------- -----------
Auditing or reviewing the financial
report by BDO Barbados 7,500 14,175
----------- -----------
Auditing or reviewing the financial
report by BDO Trinidad 34,150 30,801
----------- -----------
Auditing or reviewing the financial
report by BDO Indonesia - 19,300
----------- -----------
Total remuneration for the
subsidiaries 46,320 66,292
----------- -----------
Note 9: Loss per share
Note Consolidated
------------------------------------- ------ -------------------------------
2019 (US$) 2018 (US$)
------------------------------------- ------ --------------- --------------
a: Basic loss per share
Gain/(loss) per share from
continuing operations attributable
to the ordinary equity holders
of the company (0.24) (0.15)
--------------- --------------
Loss per share attributable
to the ordinary equity holders
of the company (0.24) (0.23)
--------------- --------------
Loss per share from discontinued
operations attributable to
the ordinary equity holders
of the company (0.48) (0.08)
--------------- --------------
b: Diluted loss per share
Loss per share from continuing n/a n/a
operations attributable to
the ordinary equity holders
of the company
------ --------------- --------------
Loss per share attributable n/a n/a
to the ordinary equity holders
of the company
------ --------------- --------------
Loss per share from discontinued n/a n/a
operations attributable to
the ordinary equity holders
of the company
------ --------------- --------------
c: Reconciliation of loss used in calculating earnings
per share
Basic/ Diluted loss per share
------------------------------------- ------ --------------- --------------
Loss from continuing operations
attributable to the ordinary
equity holders of the company (24,373,432) (11,037,893)
--------------- --------------
Loss attributable to the ordinary
equity holders of the company (49,460,755) (17,530,237)
--------------- --------------
Loss from discontinued operations
attributable to the ordinary
equity holders of the company (25,087,323) (6,492,344)
--------------- --------------
d: Weighted average number of shares used as the denominator
Weighted average number of
ordinary shares used as the
denominator in calculating
basic EPS 10,243,998,615 7,595,830,782
--------------- --------------
Note 10: Cash and cash equivalents
Note Consolidated
-------------------------- ------ ------------------------
2019 (US$) 2018 (US$)
-------------------------- ------ ----------- -----------
Cash at bank and on hand 880,681 3,945,683
----------- -----------
Risk exposure
Information about the Group's exposure to credit risk, foreign
exchange risk and price risk is provided in Note 32.
Note 11: Trade and other receivables
Note Consolidated
----------------------------------- ------ ------------------------
2019 (US$) 2018 (US$)
----------------------------------- ------ ----------- -----------
Current
Trade receivables (i) 157,827 1,197,336
----------- -----------
Taxes receivable - 3,678,430
----------- -----------
Total trade and other receivables 157,827 4,875,766
----------- -----------
(i) Trade receivables are generally due for settlement within 30
days. They are presented as current assets unless collection is not
expected for more than 12 months after the reporting date.
Fair value approximates the carrying value of trade and other
receivables at 30 June 2019 and 30 June 2018.
Note Consolidated
----------------------------------- ------ -------------------------
2019 (US$) 2018 (US$)
----------------------------------- ------ ------------ -----------
Non-current
Other receivables (i) - 2,251,384
----------- -----------
Total trade and other receivables - 2,251,384
----------- -----------
(i) Non-current receivables of $2,284,398 were fully impaired as
they are not deemed recoverable. They were receivables from
LandOcean Energy Services Co. Ltd and Sincep Oilog Equipment Co.
Ltd which are both part of LandOcean group of companies.
Fair value approximates the carrying value of non-current trade
and other receivables at 30 June 2019 and 30 June 2018.
Risk exposure
Information about the Group's exposure to credit risk, foreign
exchange risk and price risk is provided in Note 32.
Allowance for expected credit losses
The consolidated entity has recognised a loss in profit or loss
in respect of the expected credit losses for the year ended 30 June
2019 as described above.
Note 12: Other current assets
Note Consolidated
---------------------------- ------ ------------------------
2019 (US$) 2018 (US$)
---------------------------- ------ ----------- -----------
Current
Prepayments 34,208 242,142
----------- -----------
Inventory - finished goods 959,304 3,277,096
----------- -----------
Other assets (i) - 2,812,769
----------- -----------
Total other current assets 993,512 6,332,007
----------- -----------
(i) Other assets were payment of $2,800,000 made to LandOcean
Petroleum Corp. Ltd on 22 December 2017 in respect of RRDSL
acquisition.
Note 13: Controlled entities
The consolidated financial statements incorporate the assets,
liabilities and results of the following subsidiaries in accordance
with accounting policy described in Note 1(a).
Controlled Entities Consolidated Country of Percentage Owned
Incorporation (%)
------------------------------------ --------------- ==================
30 June 30 June
2019 2018
------------------------------------ --------------- -------- --------
Subsidiaries of Range Resources Limited:
Range Resources (Barbados) Limited Barbados 100 100
--------------- -------- --------
SOCA Petroleum Limited Barbados 100 100
--------------- -------- --------
Range Resources Drilling Services
Limited Trinidad 100 100
--------------- -------- --------
West Indies Exploration Company
Limited Trinidad 100 100
--------------- -------- --------
Range Resources Trinidad Limited
(held
for sale) Trinidad 100 100
--------------- -------- --------
Range Resources West Coast
Limited Trinidad 100 100
--------------- -------- --------
Range Resources (Barbados) GY
Limited Barbados 100 100
--------------- -------- --------
Range Resources GY Shallow
Limited Trinidad 100 100
--------------- -------- --------
Range Resources GY Deep Limited Trinidad 100 100
--------------- -------- --------
Range Resources Upstream Services
Limited United Kingdom 100 100
--------------- -------- --------
Range Resources HK Limited Hong Kong 100 100
--------------- -------- --------
PT Hengtai Weiye Oil and Gas Indonesia 60 60
--------------- -------- --------
PT Jasmine Oil and Gas Services Indonesia 60 60
--------------- -------- --------
PT Lubuk Kawai Raya (i) Indonesia 46.8 46.8
--------------- -------- --------
PT Aceh Timur Kawai Energi
(i) Indonesia 42.1 42.1
--------------- -------- --------
Georgian Oil Pty Ltd Australia 20 -
--------------- -------- --------
(i) Indirect control of these companies was obtained with the
acquisition of 60% of share capital in PT Hengtai Weiye Oil and
Gas.
Note 14a: Business combinations
On 30th November 2017, Range acquired RRDSL from LandOcean
Petroleum Corp. Ltd. for a consideration of US$5,500,000. Details
of the purchase consideration, the net assets acquired and goodwill
are below.
Purchase consideration comprises:
US$
--------------------- ----------
Cash payable 5,500,000
---------------------- ----------
Total consideration 5,500,000
---------------------- ----------
The group has reported provisional amounts for the assets and
liabilities acquired as follows:
Net identifiable assets acquired 2,258,528
----------------------------------- -------------
Net assets acquired:
----------------------------------- -------------
Plant and equipment 24,739,434
----------------------------------- -------------
Deferred tax asset 2,544,203
----------------------------------- -------------
Cash and cash equivalents 357,940
----------------------------------- -------------
Trade and other receivables 4,013,278
----------------------------------- -------------
Inventory 1,470,349
----------------------------------- -------------
Trade and other payables (1,745,851)
----------------------------------- -------------
Deferred tax liability (5,289,460)
----------------------------------- -------------
Borrowings (23,831,365)
----------------------------------- -------------
Goodwill 3,241,472
----------------------------------- -------------
(a) Goodwill recognition and allocation
On 30th November 2017, Range acqured RRDSL from LandOcean
Petroleum Corp. Ltd. for a consideration of US$5,500,000 which was
due to be is payable on 30 November 2020. But as disclosed in Note
7 all debt balances with LandOcean will be forgiven. Goodwill of
US$3,241,472 represented the costs savings achieved within the
Group now that RRDSL is part of Range group which has now been
fully impaired.
(b) Revenue and loss contribution
Revenue and net loss before tax of RRDSL included in the
consolidated statement of profit or loss and other comprehensive
income from the acquisition date to 30 June 2018 were US$429,426
and US$(3,015,699). If the acquisition had occurred on 1 July 2017,
revenue and net profit from RRDSL would have been US$529,002 and
US$268,188.
(c) Purchase consideration - cash outflow
Outflow of cash to acquire subsidiary net of cash acquired
US$
------------------------------------------------------------- ------------
Cash consideration -
------------------------------------------------------------ ------------
Less cash acquired 357,940
------------------------------------------------------------- ------------
Net inflow of cash - investing
activities 357,940
------------------------------------------------------------- ------------
Acquisition related costs
Acquisition related costs of US$736,881 were included in general
and administration expenses in profit or loss and in operating cash
flows in the statement of cash flows for the year ended 30 June
2018.
(d) Accounting policy
The acquisition method of accounting is used to account for all
business combinations, regardless of whether equity instruments or
other assets are acquired. The consideration transferred for the
acquisition of subsidiary comprises the:
(i) fair values of the assets transferred
(ii) liabilities incurred to the former owners of the acquired business
(iii) equity interests issued by the group
(iv) fair value of any asset or liability resulting from
contingent consideration arrangement, and
(v) fair value of any pre-existing equity interest in the subsidiary
Identifiable assets acquired and liabilities and contingent
liabilities assumed in business combination are, with limited
exceptions, measured initially at their fair values at the
acquisition date.
Acquisition-related costs are expensed as incurred.
The excess of the
(i) consideration transferred,
(ii) amount of any non-controlling interest in the acquired entity, and
(iii) acquisition-date fair value of any previous equity
interest in the acquired entity over the fair value of the net
identifiable assets acquired is recorded as goodwill. If those
amounts are less than the fair value of the net identifiable assets
of the subsidiary acquired, the difference is recognised directly
in profit or loss as bargain purchase.
Where settlement of any part of cash consideration is deferred,
the amounts payable in the future are discounted to their present
value as at the date of exchange. The discount rate used is the
entity's incremental borrowing rate, being the rate at which
similar borrowing could be obtained from an independent financier
under comparable terms and conditions.
Note 15: Intangible Assets
Note Consolidated
------------------------- ----- -------------------------
2019 (US$) 2018 (US$)
------------------------- ----- ------------ -----------
Cost 3,241,472 3,241,472
----- ------------ -----------
Impairment write down (3,241,472) -
----- ------------ -----------
Net book amount - 3,241,472
----- ------------ -----------
Year ended 30 June 2018
Opening net book amount 3,241,472 -
----- ------------ -----------
Additions-acquisition 14a - 3,241,472
----- ------------ -----------
Impairment charge (3,241,472) -
----- ------------ -----------
Closing net book amount - 3,241,472
----- ------------ -----------
Impairment tests
During the year ended 30 June 2019, the Group recorded an
impairment with respect to the total value goodwill of
US$3,241,472. Refer to note 5 for more information.
Goodwill had been allocated for impairment testing purposes to
one cash-generating unit (CGU), identified according to operating
segments, being Trinidad - oil and gas production. The goodwill
represented the costs savings achieved within the group as a result
of the RRDSL acquisition.
Note 16: Property, Plant & Equipment
Consolidated Production Gathering Leasehold Motor vehicle,
equipment station improvement furniture, Total
and access and field fixtures
roads office & fittings
----------------- ----------- ---------- ------------ -------------- -----------
US$ US$ US$ US$ US$
----------- ---------- ------------ -------------- -----------
Year ended 30 June 2018
Opening net
book amount 1,607,570 87,445 184,857 141,810 2,021,682
----------- ---------- ------------ -------------- -----------
Foreign currency
movement 2,381 127 404 210 3,122
----------- ---------- ------------ -------------- -----------
Acquisitions
from business
combination 23,742,231 - - 997,203 24,739,434
----------- ---------- ------------ -------------- -----------
Additions 214,331 - 14,484 228,082 456,897
----------- ---------- ------------ -------------- -----------
Depreciation
charge (1,475,122) (11,571) (18,255) (226,573) (1,731,521)
----------- ---------- ------------ -------------- -----------
Closing net
book amount 24,091,391 76,001 181,490 1,140,732 25,489,614
----------- ---------- ------------ -------------- -----------
At 30 June 2018
Cost 30,265,925 496,647 539,886 2,337,172 33,639,630
----------- ---------- ------------ -------------- -----------
Accumulated
depreciation (6,174,534) (420,646) (358,396) (1,196,440) (8,150,016)
----------- ---------- ------------ -------------- -----------
Net book amount 24,091,391 76,001 181,490 1,140,732 25,489,614
----------- ---------- ------------ -------------- -----------
Year ended 30 June 2019
Opening net
book amount 24,091,391 76,001 181,490 1,140,732 25,489,614
----------- ---------- ------------ -------------- -----------
Foreign currency
movement (1,213,335) 349,820 (16,215) (2,956) (882,686)
----------- ---------- ------------ -------------- -----------
Additions 162,814 - - - 162,814
----------- ---------- ------------ -------------- -----------
Disposals (60,954) - - (40,019) (100,973)
----------- ---------- ------------ -------------- -----------
Depreciation
charge (263,537) - - (236,293) (499,830)
----------- ---------- ------------ -------------- -----------
Classified as
held for sale (418,738) (425,821) (165,275) (149,401) (1,159,235)
----------- ---------- ------------ -------------- -----------
Closing net
book amount 22,297,641 - - 712,063 23,009,704
----------- ---------- ------------ -------------- -----------
At 30 June 2019
Cost 24,016,629 - - 949,452 24,966,081
----------- ---------- ------------ -------------- -----------
Accumulated
depreciation (1,718,988) - - (237,389) (1,956,377)
----------- ---------- ------------ -------------- -----------
Net book amount 22,297,641 - - 712,063 23,009,704
----------- ---------- ------------ -------------- -----------
Note 17: Exploration assets
Note Consolidated
----------------------------- ------ -------------------------
2019 (US$) 2018 (US$)
----------------------------- ------ ------------ -----------
Opening balance (ii) 6,744,977 632,176
------------ -----------
Acquisition (i) - 6,077,873
------------ -----------
Impairment (ii) (6,077,873) -
------ ------------ -----------
Foreign exchange 6,782 34,948
------------ -----------
Classified as held for sale (673,886) -
(note 7a)
------ ------------ -----------
Closing net book amount - 6,744,997
------------ -----------
(i) Asset acquisition
On 30th October 2017, Range Resources Limited acquired through
Range Resources HK Limited, 60% of the shares of PT Hengtai Weiye
Oil and Gas ("Hengtai"), resulting in a 23% indirect equity
interest in the Perlak field, Indonesia. Control has been obtained
through the shareholder agreements in place at each entity
level.
Details of the fair value of the assets acquired are as
follows:
Purchase consideration comprises: US$
----------------------------------- ----------
Cash 2,560,000
------------------------------------ ----------
Total cash paid 2,560,000
------------------------------------ ----------
Total consideration 2,560,000
------------------------------------ ----------
Net assets acquired: US$
----------------------------------- ------------
Exploration and evaluation assets 6,077,873
------------------------------------ ------------
Less: non-controlling interests (3,517,873)
------------------------------------ ------------
Total 2,560,000
------------------------------------ ------------
Put option agreement
The vendor has agreed to provide Range with a put option,
whereby Range has the option to enforce a buyback of its full 60%
interest in Hengtai should agreed milestones not be achieved,
therefore providing protection to Range's investment. These
milestones, amongst others, include achieving minimum production of
800 bopd from Perlak field over a continuous 90-day period, as well
as proving up independently audited 1P reserves of at least 10
mmbbl within a three-year period. On acquisition, a cash
consideration of US$2,560,000 was paid.
Asset acquisition accounting policy
The transaction is not deemed a business combination as the
assets acquired did not meet the definition of a business. When an
asset acquisition does not constitute a business combination, the
assets and liabilities are assigned a carrying amount based on
their relative fair values in an asset purchase transaction and no
deferred tax will arise in relation to the acquired assets and
assumed liabilities as the initial recognition exemption for
deferred tax under AASB 112 applies. No goodwill arose on the
acquisition and transaction costs of the acquisition will be
included in the capitalised cost of the asset. The non-controlling
interest is recognised at fair value. All the other expenses in
relation to Indonesia are expensed in exploration costs in the
Income Statement.
(ii) Impairment
Range has been actively working with its partners on the Perlak
oil project for approximately 18 months. The initial results from
the wells re-entered have been below expectations and given the
ongoing difficulties being experienced the Company has decided to
fully expense all costs incurred to date and will continue to do so
going forward. Given these disappointing results, the Company has
made a decision to write off the value of its investment in
Indonesia, resulting to an impairment of US$6,077,873.
Note 18: Producing assets
Note Consolidated
----------------------------- ------ ----------------------------
2019 (US$) 2018 (US$)
----------------------------- ------ ------------- -------------
Cost 46,006,207 152,711,418
------------- -------------
Accumulated amortisation (46,006,207) (43,619,768)
------------- -------------
Net book value - 109,091,650
------------- -------------
Opening net book amount 109,091,650 108,347,455
------------- -------------
Foreign currency movement 1,053,641 88,034
------------- -------------
Additions 1,407,974 3,875,306
------------- -------------
Impairment charge (51,320,529) -
------ ------------- -------------
Amortisation charge (1,246,702) (3,219,145)
------------- -------------
Classified as held for sale
(note 7a) (58,986,034)
------------- -------------
Closing net book amount - 109,091,650
------------- -------------
Although impairment indicators existed at 30 June 2019, the
Group did not undertake an impairment assessment as the value of
producing assets was derived from the Sale and Purchase Agreement
with LandOcean as fair value of the consideration exceeds the
carrying value of the assets, refer to note 7.
Note 19: Trade and other payables
Note Consolidated
----------------------------------- ------ ------------------------
2019 (US$) 2018 (US$)
----------------------------------- ------ ----------- -----------
a: Current
Trade payables 648,693 1,416,480
----------- -----------
Sundry payables and accrued
expenses 151,281 8,513,026
----------- -----------
Total 799,974 9,929,506
----------- -----------
b: Non-Current
Interest bearing trade payables 44,395,944 41,359,805
----------- -----------
Accrued expenses - 5,796,050
----------- -----------
Other payables - interest bearing 482,886 3,242,977
----------- -----------
Other payables - non-interest
bearing 118,963 42,947
----------- -----------
Total 44,997,793 50,441,779
----------- -----------
Risk exposure
Trade payables are non-interest bearing. Interest bearing other
payables are amounts due to LandOcean and form part of the
conditional SPA signed in September. Contractually, they are not
payable until April 2020. Interest charged at 6%. Other
interest-bearing payables relate to the consideration due to
LandOcean Petroleum Corp which also forms part of the SPA.
Note 20: Borrowings
Note Consolidated
------------------------------ ----- ------------------------
2019 (US$) 2018 (US$)
------------------------------ ----- ----------- -----------
Current borrowings
Interest on convertible note 20c 1,600,000 1,600,000
----- ----------- -----------
Option liability 20b - 33,345
----- ----------- -----------
Total current borrowings 1,600,000 1,633,345
----- ----------- -----------
Non-current borrowings
Borrowings at amortised cost 20a 25,791,724 24,481,224
----- ----------- -----------
Convertible note 20c 18,759,966 17,958,382
----- ----------- -----------
Total non-current borrowings 44,551,690 42,439,606
----- ----------- -----------
Note Consolidated
----------------------------- ------ ------------------------
2019 (US$) 2018 (US$)
----------------------------- ------ ----------- -----------
a: Borrowings
Principal 15,640,024 15,640,024
----------- -----------
Interest due on outstanding
balance 10,151,700 8,841,200
----------- -----------
Closing net book amount 25,791,724 24,481,224
----------- -----------
These are unsecured payables to EPT, Unionpetro, GPN and LO
Petroleum, which all belong to the LandOcean group of companies.
Interest is charged at 6% on net balance outstanding, with the
amounts being payable within three years.
Note Consolidated
-------------------------------- ------ -------------------------
2019 (US$) 2018 (US$)
-------------------------------- ------ ------------ -----------
b: Option liability
Option liability at fair value
through profit or loss - 33,345
----------- -----------
Closing net book amount - 33,345
----------- -----------
During 2019, no options were exercised (2018: Nil).
Total fair value movement recognised in the Statement of Profit
or Loss was a gain of US$33,345 (2018: US$308,273).
Note Consolidated
----------------------------- ------ ------------------------
2019 (US$) 2018 (US$)
----------------------------- ------ ----------- -----------
c: Convertible note
Convertible note liability
element 16,507,750 16,507,750
----------- -----------
Convertible note derivative
element 113 384,007
----------- -----------
Interest due on outstanding
balance - non-current 652,103 1,066,625
----------- -----------
Interest due on outstanding
balance- current 1,600,000 1,600,000
----------- -----------
Closing net book amount 18,759,966 19,558,382
----------- -----------
The terms of the convertible note are as follows:
Issuer Range Resources Limited
Noteholder LandOcean Energy Services Co. Limited
------------------------------------------
Amount US$20,000,000
------------------------------------------
Tenor Three years, maturity date 28 November
2019 (i)
------------------------------------------
Repayment Bullet at maturity date
------------------------------------------
Interest 8% per annum, payable annually in arrears
(ii)
------------------------------------------
Security None
------------------------------------------
Conversion price 0.88p per share
------------------------------------------
Lender Conversion At any time, in a minimum amount of
Right US$10,000,000
------------------------------------------
The proceeds from this convertible note were utilised solely to
replace a portion of the outstanding payable balance due to
LandOcean under the terms of the Integrated Master Services
Agreement ("IMSA").
(i) As per SPA dated 2 September 2019, a maturity date is the
earlier of 30 June 2020 and the date on which completion occurs
under. Under SPA, LandOcean undertakes not to issue a conversion
notice.
(ii) On 5 March 2019, the Group issued 1,739,076,923 new
ordinary fully paid shares at A$0.0013 in lieu of annual interest
payment of US$1,600,000 due in November 2018.
Given that the transaction with LandOcean to sell Range
Resources Trinidad Ltd is approved as previously explained in note
7 and described, all borrowings will be waived and form part of the
transaction consideration.
Note 21: Provision for rehabilitation
The Group records the present value of the estimated cost of
legal and constructive obligations to restore operating locations
in the period in which the obligation arises. The nature of
restoration activities includes removal of facilities, abandonment
of wells and restoration of affected areas.
Note Consolidated
--------------------------------- ------ ------------------------
2019 (US$) 2018 (US$)
--------------------------------- ------ ----------- -----------
Provision for rehabilitation 811,737 811,737
----------- -----------
Movement in the provision for rehabilitation during the
financial year are set out below:
Carrying amount at the start
of the year 811,737 784,316
----------- -----------
Additional provision recognised 24,618 27,420
----------- -----------
Included in held for sale (note
7b) (836,355)
----------- -----------
Carrying amount at the end
of the year - 811,737
----------- -----------
Note 22: Deferred taxes
Accrued Total
interest
---------------------------------------- ----------- -----------
Deferred tax asset US$ US$
Movements: Year ended 30 June 2019
Opening balance 13,517,531 13,517,531
----------- -----------
Charged/(credited) - to profit or loss 1,921,479 1,921,479
----------- -----------
Acquisition of subsidiary - 2,544,203
----------- -----------
Closing net book amount (i) 15,439,010 15,439,010
----------- -----------
(i) Deferred tax asset is included in the asset held for sale
(note 7a)
Fair value Accelerated Total
uplift on depreciation
business
combination
-------------------------------- ------------- -------------- -------------
Deferred tax liability US$ US$ US$
Movements: Year ended 30 June 2018
Opening balance 28,332,926 26,167,218 54,500,144
------------- -------------- -------------
Foreign currency movement - (567,580) (567,580)
------------- -------------- -------------
Charged/(credited) - to profit
or loss 96,259 5,443,659 5,539,918
------------- -------------- -------------
Acquisition of subsidiary - 5,289,460 5,289,460
------------- -------------- -------------
Closing net book amount 28,429,185 36,332,757 64,761,942
------------- -------------- -------------
Movements: Year ended 30 June 2019
Opening balance 28,429,185 36,332,757 64,761,942
------------- -------------- -------------
Foreign currency movement - (645,359) (645,359)
------------- -------------- -------------
Charged/(credited) - to profit
or loss 1,617,020 (25,643,271) (24,026,251)
------------- -------------- -------------
Closing net book amount (i) 30,046,205 10,044,127 40,090,332
------------- -------------- -------------
(i) Deferred tax liability is included in liabilities directly
associated with assets held for sale (note 7b)
Note 23: Other non-current liabilities
Note Consolidated
--------------------------- ------ ------------------------
2019 (US$) 2018 (US$)
--------------------------- ------ ----------- -----------
Employee service benefits 324,742 731,350
----------- -----------
Total 324,742 731,350
----------- -----------
Risk exposure
Information about the Group's exposure to credit risk, foreign
exchange risk and price risk is provided in Note 32.
Note 24: Contributed equity
Note Consolidated
-------------------------------------- ------ ----------------------------
2019 (US$) 2018 (US$)
-------------------------------------- ------ ------------- -------------
10,243,998,615 (2018: 7,595,830,782)
fully paid ordinary shares 407,770,469 404,910,284
------------- -------------
Share issue costs (21,044,402) (20,991,887)
------------- -------------
Total contributed equity 386,726,067 383,918,397
------------- -------------
Consolidated
---------------------- -----------------------------------------------------------
2019 No. 2019 (US$) 2018 No. 2018 (US$)
---------------------- --------------- ------------ -------------- ------------
a: Fully paid ordinary shares
At the beginning
of reporting period 7,595,830,782 404,910,284 7,595,830,782 404,910,284
--------------- ------------ -------------- ------------
Shares issued during
year 2,648,167,833 2,860,185 - -
--------------- ------------ -------------- ------------
Total contributed
equity 10,243,998,615 407,770,469 7,595,830,782 404,910,284
--------------- ------------ -------------- ------------
Ordinary shares entitle the holder to participate in dividends
and the proceeds on winding up of the Company in proportion to the
number of and amounts paid on the shares held.
On a show of hands every holder of ordinary shares present at a
meeting of the Company, in person or by proxy, is entitled to one
vote and upon a poll each share is entitled to one vote.
On 28 July 2018, the Group announced a subscription for new
ordinary shares to raise GBP1 million before expenses. Pursuant to
the Subscription, the Group issued 909,090,910 new ordinary shares
at a price of 0.11 pence per new ordinary share.
On 5 March 2019, the Group issued 1,739,076,923 new ordinary
fully paid shares at A$0.0013 in lieu of annual interest payment of
US$1.6 million under the convertible note with LandOcean Energy
Services Co., Ltd.
Consolidated
-------------------------------------- -----------------------------
2019 No. 2018 No.
-------------------------------------- -------------- -------------
b: Options
At the beginning of reporting period 781,844,977 808,844,977
-------------- -------------
Options expired (377,201,840) (27,000,000)
-------------- -------------
Options exercised during year - -
-------------- -------------
Total options 404,643,137 781,844,977
-------------- -------------
At 30 June 2019, the unissued ordinary shares under option are
as follows:
Date of expiry Exercise price Number under
option
================= =============== ============
3 September 2019 GBP0.01 194,585,862
=============== ============
3 September 2019 GBP0.02 172,557,275
=============== ============
30 March 2020 GBP0.01 37,500,000
=============== ============
Total number under option: 404,643,137
============
The holders of these options do not have any rights under the
options to participate in any share issues of the company.
During the year ended 30 June 2019, no ordinary shares of Range
were issued on the exercise of options (2018: nil).
Note 25: Reserves
Note Consolidated
------------------------------------ ------ ------------------------
2019 (US$) 2018 (US$)
------------------------------------ ------ ----------- -----------
a: Share-based payment reserve
Balance 1 July 2018 8,424,371 8,516,837
----------- -----------
Share based payment expenses (Note
29) (107,907) (92,466)
----------- -----------
Balance 30 June 2019 8,316,464 8,424,371
----------- -----------
The share-based payment reserve records items recognised as
expenses on the fair valuation of shares and options issued as
remuneration to employees, directors and consultants. For the year
ended 30 June 2019 is a debit balance reflecting the expiration and
cancellation of a large amount of options.
Note Consolidated
------------------------------------------ ------ ------------------------
2019 (US$) 2018 (US$)
------------------------------------------ ------ ----------- -----------
b: Option premium reserve
Balance 1 July 2018 12,057,362 12,057,362
----------- -----------
Fair value movement of exercised - -
options that were originally classified
as a derivative liability
------ ----------- -----------
Balance 30 June 2019 12,057,362 12,057,362
----------- -----------
The option premium reserve is used to recognise the grant date
fair value of options.
Note Consolidated
---------------------------------- ------ -------------------------
2019 (US$) 2018 (US$)
---------------------------------- ------ ----------- ------------
c: Foreign currency translation reserve
Balance 1 July 2018 4,341,220 5,765,112
----------- ------------
Currency translation differences
arising during the year 3,091,241 (1,423,892)
----------- ------------
Balance 30 June 2019 7,432,461 4,341,220
----------- ------------
The foreign currency translation reserve is used to record
exchange differences arising from the translation balances of
foreign subsidiaries.
Total reserves at 30 June 2019 27,806,287 24,822,953
Note 26: Contingent liabilities and contingent assets
Geeta Maharaj
Range received an invoice from Geeta Maharaj, a Trinidad based
attorney seeking payment for legal services in the amount of
approximately US$1.9 million. The invoice purports to relate to
legal work undertaken during mid-2014 including the preparation of
inter-company loan agreements. Range strongly refutes the amount of
this purported invoice and considers it to be vastly excessive and
therefore not payable. A claim has been filed by Ms Maharaj seeking
the sum of TT$12,019,573 (approximately US$1.9 million) plus
interest and costs. Range filed a notice of application to strike
out this claim on 14 July 2017. An initial hearing on this
application was held on 29 September 2017 at which the parties were
ordered to file and exchange written submissions by 20 October 2017
with replies, if any, to be filed by 30 October 2017. Both parties
filed and exchanged written submissions and responses by the
requested dates and a further hearing was scheduled for 1 December
2017. This hearing was rescheduled by the court and the Company is
awaiting notification of a rescheduled date.
Separately, Range has received further correspondence from Ms
Maharaj on a related matter claiming damages of TT$6,000,000
(approximately US$890,000) on the basis of a conspiracy designed to
damage Ms Maharaj's reputation. Again, Range firmly refutes the
allegation and in conjunction with its legal counsel in Trinidad
has responded to this demand. A claim has been filed by Ms Maharaj
seeking damages of TT$6,000,000 (approximately US$890,000) plus
interest and costs. The Company, in conjunction with its legal
counsel, has filed a defence in respect of this claim and a
preliminary hearing was scheduled for 1 December 2017. This hearing
was rescheduled by the court and the Company is awaiting
notification of a rescheduled date.
While the Company, having taken legal advice, considers the
probability of Ms Maharaj succeeding in either of her claims to be
remote, there can be no guarantee that there will be a favourable
outcome for the Company. There have been no other updates with
regards to this case since 30 June 2018.
The Directors are not aware of any further contingent
liabilities or contingent assets as at 30 June 2019.
Note 27: Segment reporting
30 June 2019 Trinidad Trinidad Indonesia Unallocated Total
- Oil & - Oilfield US$ US$ US$
Gas Production Services
US$ US$
--------------------------------- ---------------- ------------ ------------ ------------- -------------
Segment revenue
Total segment revenue 11,597,161 4,218,523 - - 15,815,684
---------------- ------------ ------------ ------------- -------------
Intersegment revenue - (3,458,549) - - (3,458,549)
---------------- ------------ ------------ ------------- -------------
Revenue from external
customers 11,597,161 759,974 - - 12,357,135
---------------- ------------ ------------ ------------- -------------
Other income 7,108 - - 2,936 10,045
---------------- ------------ ------------ ------------- -------------
Segment result
Depreciation (1,493,021) (2,464,926) - - (3,957,947)
---------------- ------------ ------------ ------------- -------------
Interest expense (655,249) (1,532,938) - (4,270,140) (6,458,327)
---------------- ------------ ------------ ------------- -------------
Other segment income/(expenses) (61,789,770) 1,177,183 (6,695,045) (7,044,871) (74,352,503)
---------------- ------------ ------------ ------------- -------------
Loss before income
tax (52,333,771) (2,060,707) (6,695,045) (11,312,075) (72,401,598)
---------------- ------------ ------------ ------------- -------------
Income tax 27,246,448 (168,633) - (4,136,972) (22,940,843)
---------------- ------------ ------------ ------------- -------------
Loss after income
tax (25,087,323) (2,229,340) (6,695,045) (15,449,047) (49,460,755)
---------------- ------------ ------------ ------------- -------------
Segment assets
Segment assets 83,609,947 24,244,249 - 797,474 108,651,670
---------------- ------------ ------------ ------------- -------------
Total assets 83,609,947 24,244,249 - 797,474 108,651,670
---------------- ------------ ------------ ------------- -------------
Segment liabilities
Segment liabilities 59,071,174 23,974,481 - 68,299,717 151,345,372
---------------- ------------ ------------ ------------- -------------
Total liabilities 59,071,174 23,974,481 - 68,299,717 151,345,372
---------------- ------------ ------------ ------------- -------------
30 June 2018 Trinidad Trinidad Indonesia Unallocated Total
- Oil & - Oilfield US$ US$ US$
Gas Production Services
US$ US$
--------------------------------- ---------------- ------------ ------------ ------------- -------------
Segment revenue
Total segment revenue 12,629,996 3,561,259 - - 16,191,255
---------------- ------------ ------------ ------------- -------------
Intersegment revenue - (3,131,833) - - (3,131,833)
---------------- ------------ ------------ ------------- -------------
Revenue from external
customers 12,629,996 429,426 - - 13,059,422
---------------- ------------ ------------ ------------- -------------
Other income 161,828 15,060 - 245,009 421,897
---------------- ------------ ------------ ------------- -------------
Segment result
Depreciation (2,374,508) (2,576,158) - - (4,950,666)
---------------- ------------ ------------ ------------- -------------
Interest income/(expense) 103,187 (498,435) - (2,704,172) (3,099,420)
---------------- ------------ ------------ ------------- -------------
Other segment expenses (12,044,090) (4,874,421) (1,253,329) (3,247,456) (21,419,296)
---------------- ------------ ------------ ------------- -------------
Loss before income
tax (1,523,587) (7,504,498) (1,253,329) (5,706,619) (15,988,033)
---------------- ------------ ------------ ------------- -------------
Income tax (1,827,521) 285,317 - - (1,542,204)
---------------- ------------ ------------ ------------- -------------
Loss after income
tax (3,351,108) (7,219,181) (1,253,329) (5,706,619) (17,530,237)
---------------- ------------ ------------ ------------- -------------
Segment assets
Segment assets 127,047,106 34,469,110 6,077,873 7,896,015 175,490,104
---------------- ------------ ------------ ------------- -------------
Total assets 127,047,106 34,469,110 6,077,873 7,896,015 175,490,104
---------------- ------------ ------------ ------------- -------------
Segment liabilities
Segment liabilities 68,336,505 37,226,190 - 65,433,487 170,996,182
---------------- ------------ ------------ ------------- -------------
Total liabilities 68,336,505 37,226,190 - 65,433,487 170,996,182
---------------- ------------ ------------ ------------- -------------
(i) Unallocated assets
30 June 30 June
2019 2018
US$ US$
---------------------- -------- ----------
Segment assets
Cash 797,474 3,000,847
-------- ----------
Other - 4,895,168
-------- ----------
Total segment assets 797,474 7,896,015
-------- ----------
Note Consolidated
----------------------------------- ------ ------------------------
2019 (US$) 2018 (US$)
----------------------------------- ------ ----------- -----------
a: Other segment information
Segment other revenue - all other segments
Other income 2,936 245,009
----------- -----------
Total unallocated segment revenue 2,936 245,009
----------- -----------
Note Consolidated
------------------------------------ ------ ------------------------
2019 (US$) 2018 (US$)
------------------------------------ ------ ----------- -----------
Segment result - all other segments
Directors' and officers' fees
and benefits 924,584 939,802
----------- -----------
Share based payments - employee
and onsultant shares (107,907) (92,466)
----------- -----------
Discontinued operations - -
------ ----------- -----------
Finance costs 4,648,884 2,393,872
----------- -----------
Other general and administration
expenses 1,919,773 2,895,353
----------- -----------
Total unallocated segment expenses 7,385,334 6,136,561
----------- -----------
Accounting policies
AASB 8 requires operating segments to be identified on the basis
of internal reports about components of the Group that are
regularly reviewed by the chief operating decision maker in order
to allocate resources to the segment and to assess its performance.
The chief operating decision maker is the Chief Executive Officer
and through this role the Board of Directors.
Information regarding these segments is presented above. The
accounting policies of the reportable segments are the same as
those of the Group. Segment information is prepared in conformity
with the accounting policies of the entity as disclosed in Note
1.
Segment revenues and expenses are those directly attributable to
the segments and include any joint revenue and expenses where a
reasonable basis of allocation exists. Segment assets include all
assets used by a segment and consist principally of cash,
receivables, plant and equipment, exploration expenditure
capitalised and development assets net of accumulated depreciation
and amortisation. While most such assets can be directly attributed
to individual segments, the carrying amount of certain assets
usedvjointly by two or more segments is allocated to the segments
on a reasonable basis. Segment disclosures do not include deferred
income taxes.
Revenue from Trinidad - Oil & Gas Production segment of
US$11,597,161 (2018: US$12,629,996) is derived from the
subsidiary's sole customer, which is Heritage Petroleum
Limited.
Intersegment transfers
Segment revenues, expenses and results do not include any
transfers between segments.
Note 28: Cash flow information
Note Consolidated
------------------------------------------ ----- ----------------------------
2019 (US$) 2018 (US$)
------------------------------------------ ----- ------------- -------------
Reconciliation of cash flow from operations with loss after
income tax
Loss after income tax (49,760,755) (17,530,237)
----- ------------- -------------
Non-cash flows in profit
----- ------------- -------------
Depreciation, depletion and amortisation 3,957,947 4,950,666
----- ------------- -------------
Share based payment- consultants
and employees (107,907) (92,466)
----- ------------- -------------
Impairment of non-current assets 6,077,873 -
----- ------------- -------------
Foreign exchange (gain)/loss 118,502 193,079
----- ------------- -------------
Impairments recognised on held 51,320,529 -
for sale assets
----- ------------- -------------
Fair value movement of derivative 4 (383,894) (2,308,556)
----- ------------- -------------
Decrease in other current assets (5,338,495) (1,854,276)
----- ------------- -------------
Decrease in trade and other receivables 6,969,323 5,479,970
----- ------------- -------------
Decrease/(increase) in deferred
tax asset - (6,664,396)
----- ------------- -------------
(Decrease)/increase in trade
and other payables (15,030,944) 7,367,699
----- ------------- -------------
Decrease in income tax payable (229,445) -
----- ------------- -------------
(Decrease)/increase in deferred
tax liabilities - 10,261,798
----- ------------- -------------
(Decrease)/increase in provisions (811,737) 27,420
----- ------------- -------------
Increase/(decrease) in borrowings 2,112,084 -
----- ------------- -------------
(Decrease)/Increase in non-current
operating payables (430,323) (2,302,185)
----- ------------- -------------
Held for sale (1,438,646) -
----- ------------- -------------
Net cash outflow (from)/to operations (2,675,888) (2,471,484)
----- ------------- -------------
Financial liability reconciliation
2018 Cash Flows Non-cash changes 2019
----------- -----------
Acquisition Fair value/other Interest accrued
changes
--------------------------- ----------- ----------- ------------ ----------------- -----------------
Borrowings 24,481,224 - - - 1,310,500 25,791,724
----------- ----------- ------------ ----------------- ----------------- -----------
Convertible note 19,558,382 - - (1,983,894) 1,681,975 19,256,463
----------- ----------- ------------ ----------------- ----------------- -----------
Total liabilities from
financing activities 44,039,606 - - (1,983,894) 2,992,475 45,048,187
----------- ----------- ------------ ----------------- ----------------- -----------
On 05 March 2019, the Group issued 1,739,076,923 new ordinary
fully paid shares at A$0.0013 in lieu of annual interest payment of
US$1,600,000 due in November 2018.
Non-cash changes comprise the aforementioned US$1,600,000 plus
fair value movement of US$383,394.
Note 29: Share based payments
Employee option plan
Year ended 30 June 2019
No options were issued to key management personnel. The expense
reversal is due to the change in the probability of meeting the
vesting conditions as explained below.
Probability of meeting the 1,500 barrels of oil per day for a
continuous 15-day period in Trinidad vesting condition is 0%.
Probability of meeting the 2,500 barrels of oil per day for a
continuous 15-day period in Trinidad vesting condition is 0%.
Probability of meeting the 4,000 barrels of oil per day for a
continuous 15-day period in Trinidad vesting condition is 0%.
Year ended 30 June 2018
No options were issued to key management personnel, employees
and consultants.
Expenses recognised in the profit or loss
During the year, share-based payments recognised in profit or
loss amounts to a reversal of US$107,907 (2018: reversal of
US$92,466).
2019 No. Average 2018 No. Average
exercise exercise
price (US$) price (US$)
--------------------------- -------------- ------------- ------------- -------------
As at 1 July 761,844,977 0.023 788,844,977 0.019
-------------- ------------- ------------- -------------
Granted during year:
-------------- ------------- ------------- -------------
Other - - - -
-------------- ------------- ------------- -------------
Expired (357,201,840) 0.017 (27,000,000) 0.025
-------------- ------------- ------------- -------------
Forfeited - - - -
-------------- ------------- ------------- -------------
As at 30 June 404,643,137 0.018 761,844,977 0.023
-------------- ------------- ------------- -------------
Vested and exercisable
at 30 June 9,375,000 0.01 701,845,000 0.025
-------------- ------------- ------------- -------------
Weighted average 85 days 153 days
remaining contractual
life options outstanding
at end of period
-------------- ------------- ------------- -------------
Note 30: Related party transactions
(a) Parent entity
The ultimate Parent Entity and ultimate Australian Parent Entity
within the Group is Range Resources Limited.
(b) Subsidiaries
Interests in subsidiaries are set out in Note 13.
(c) Transactions with Key Management Personnel
The following transactions occurred during the year with Key
Management Personnel or their related parties:
2019 2018
US$ US$
-------------------------------------------------- -------- --------
Consulting fees paid or payable to Kaiyuan
Guosen Management Consulting Limited, a company
owned by Mr Gu 253,333 195,000
-------- --------
Consulting fees paid or payable to Plentiful
Wise Holdings Limited, a company owned by
Ms Wang - 112,500
-------- --------
Consulting fees paid or payable to Ten Faye
Limited, a company owned by Mr L Liu 7,700 25,740
-------- --------
Balances at year end to related parties
Lijun Xiu and related entities - 42,000
-------- --------
Note Consolidated
-------------------------- ------ ------------------------
2019 (US$) 2018 (US$)
-------------------------- ------ ----------- -----------
d: Key Management Personnel compensation
Short-term benefits 797,189 884,847
----------- -----------
One-off payments - -
------ ----------- -----------
Post-employment benefits 37,388 39,737
----------- -----------
Termination benefits - -
------ ----------- -----------
Share based payments (72,628) (83,985)
----------- -----------
Total 761,949 840,599
----------- -----------
Note 31: Parent entity information
The following details information related to the Parent Entity
Range Resources Limited, at 30 June 2019. The information presented
here has been prepared in accordance using consistent accounting
policies as presented in Note 1.
Note Consolidated
----------------------------------- ------ ------------------------------
2019 (US$) 2018 (US$)
----------------------------------- ------ -------------- --------------
Current assets 3,597,474 5,823,790
-------------- --------------
Non-current assets 22,008,541 64,091,154
-------------- --------------
Total assets 25,606,015 69,914,944
-------------- --------------
Current liabilities 307,884 2,176,682
-------------- --------------
Non-current liabilities 67,991,834 63,244,340
-------------- --------------
Total liabilities 68,299,718 65,421,022
-------------- --------------
Contributed equity 387,730,534 383,918,396
-------------- --------------
Accumulated losses (452,663,645) (402,977,948)
-------------- --------------
Reserves 22,239,408 23,553,474
-------------- --------------
Total equity (42,693,703) 4,493,922
-------------- --------------
Loss for the year from continuing
operations (34,810,725) (15,352,002)
-------------- --------------
Total comprehensive loss for
the year (34,810,725) (15,352,002)
-------------- --------------
The contingent liabilities of the parent are included within
those of the Group as disclosed in Note 26.
The contractual commitments of the parent are included within
those of the Group as disclosed in Note 33.
Note 32: Financial risk management
The Group has exposure to the following risks from their use of
financial instruments:
-- Credit risk
-- Liquidity risk
-- Market risk
This note presents information about the Group's exposure to
each of the above risks, their objectives, policies and processes
for measuring and managing risk, and the management of capital.
Further quantitative disclosures are included throughout these
financial statements. The Board of Directors has overall
responsibility for the establishment and oversight of the risk
management framework.
Risk management policies are established to identify and analyse
the risks faced by the Group, to set appropriate risk limits and
controls, and to monitor risks and adherence to limits. Risk
management policies and systems are reviewed to reflect changes in
market conditions and the Group's activities. The Group, through
training and management standards and procedures, aims to develop a
disciplined and constructive control environment in which all
consultants and agents understand their roles and obligations.
Credit risk
Credit risk is the risk of financial loss to the Group if
counterparty to a financial instrument fails to meet its
contractual obligations, and arises principally from the Group's
receivables and cash held at financial institutions.
Credit risk is managed on a group basis. Individual risk limits
are set based on internal or external ratings in accordance with
limits set by the board. Although there is only one customer and
hence significant concentration to one customer, the credit risk is
considered low.
The credit quality of financial assets that are neither past due
or impaired can be assessed by reference to external credit ratings
(if available) or to historical information about counterparty
default rates.
Note Consolidated
------------------- --------- --------------------------------------
2019 (US$) 2018 (US$)
------------------- --------- ------------------ ------------------
Cash at bank, restricted deposits and short-term bank deposits
(S&P ratings)
AAA - 398,530 2,509,501
--------- ------------------ ------------------
AA- 398,944 490,986
--------- ------------------ ------------------
A+ - -
--------- ------------------ ------------------
BBB+ 83,207 945,196
--------- ------------------ ------------------
BBB- - -
--------- ------------------ ------------------
Not rated - -
--------- ------------------ ------------------
Total 10 880,681 3,945,683
--------- ------------------ ------------------
Exposure to credit risk
The carrying amount of the Group's financial assets represents
the maximum credit exposure. The Group's maximum exposure to credit
risk at the reporting date was:
Note Consolidated
------------------------------- ----- ------------------------
2019 (US$) 2018 (US$)
------------------------------- ----- ----------- -----------
Trade and other receivables -
non-current (i) 11 - 2,251,384
----- ----------- -----------
Trade and other receivables -
current (i) 11 157,827 4,875,766
----- ----------- -----------
Cash and cash equivalents 10 880,681 3,945,683
----- ----------- -----------
Total 1,038,508 11,072,833
----- ----------- -----------
(i) Counterparties without an external credit rating.
Loans and receivables
The Group's exposure to credit risk is influenced mainly by the
individual characteristics of each debtor. No collateral was held
in relation to these receivables.
Impairment losses
No impairment loss was recognised in relation to other
receivables respectively in the prior year.
Liquidity risk
Liquidity risk is the risk that the Group will not be able to
meet its financial obligations as they fall due. The Group's
approach to managing liquidity is to ensure, as far as possible,
that it will always have sufficient liquidity to meet its
liabilities when due, under both normal and stressed conditions,
without incurring unacceptable losses or risking damage to the
Group's reputation.
The Group uses activity-based costing to cost its activities,
which assists in monitoring cash flow requirements and optimising
its cash return on investments. Typically, the Group ensures that
it has sufficient cash on demand to meet expected operational
expenses for a period of 12 months; this excludes the potential
impact of extreme circumstances that cannot reasonably be
predicted, such as natural disasters.
Group 2019
Carrying Contractual Within 1-2 years 2-5 years
amount cash flows one year
----------------- ---------- ------------ ---------- ---------- ----------
Financial liabilities at amortised cost
Trade and other
payables 45,797,767 45,797,767 12,901,659 32,896,108 -
Borrowings 46,151,690 44,551,690 1,600,000 44,551,690 -
Total 92,274,199 90,674,199 14,501,659 77,272,540 -
Group 2018
Carrying Contractual Within 1-2 years 2-5 years
amount cash flows one year
Financial liabilities at amortised cost
Trade and other
payables 60,371,285 60,371,285 9,929,506 50,441,779 -
Borrowings 44,039,606 42,439,605 1,600,000 42,439,606 -
Total 104,410,891 102,811,430 11,529,506 92,881,385 -
Market risk
Market risk is the risk that changes in market prices, such as
interest rates and equity prices will affect the Group's income or
the value of its holdings of available for sale assets. The
objective of market risk management is to manage and control market
risk exposures within acceptable parameters, while optimising the
return.
Oil price
Future value, growth and financial conditions are dependent upon
the prevailing prices for oil. Prices for oil are subject to
fluctuations and are affected by numerous factors beyond the
control of the Company. Sustained periods of low oil price may
impact the viability of growth projects. The Company monitors and
analyses the current and forecast oil prices on a regular basis.
Range does not currently hedge its oil price exposure. Price
hedging arrangements would be implemented if deemed appropriate for
financial planning and to mitigate commodity price risks.
Equity price risk
The Group is exposed to equity securities price risk. This
arises from investments held by the Group and classified on the
statement of financial position as available for sale as well as
from the option liability held as a current liability. A 10%
increase or decrease in Range's share price would not have an
effect to the option liability.
Foreign exchange risk
The Group operates internationally and is exposed to foreign
exchange risk arising from various currency exposures, primarily
with respect to the US dollar, AU dollar, TT Dollar and British
pound. Foreign exchange risk arises from future commercial
transactions and recognised assets and liabilities denominated in a
currency that is not the entity's functional currency. The risk is
measured using sensitivity analysis and cash flow forecasting.
The Group's treasury risk management policy is to closely
monitor exchange rate fluctuations. To date, the Group has not
sought to hedge its exposure to fluctuations in exchange rates,
however this policy will be reviewed on an ongoing basis.
The Group's exposure to foreign currency risk at the reporting
date was as follows:
Consolidated
2019 AUD 2018 AUD 2019 GBP 2018 GBP
Cash 249,624 206,996 38,965 60,911
Amount payable to
other entities (66,216) (73,269) (48,631) (50,550)
Total 183,408 133,727 (9,666) 10,361
Sensitivity
Based upon the amounts above, had the Australian dollar
strengthened by 10% against the US dollar with all other variables
held constant, the Group post-tax loss for the year on current
amounts receivable/payable would have been US$10,824 higher (2018:
US$18,064 higher), mainly as a result of foreign exchange
gains/losses on translation of AUD and GBP
denominated payables as detailed in the table above. A 10%
weakening of the Australian dollar against the above currencies at
30 June would have had the equal but opposite effect, on the basis
that all other variables remain constant.
The Trinidad entities are minimally exposed to foreign exchange
risk arising from various currencies, primarily with respect to the
United States Dollar.
Interest rate risk
The group's main interest rate risk arises from non-current
receivables. Non-current receivables issued at fixed rates expose
the group to fair value interest rate if the loans are carried at
fair value. During 2019 and 2018, the group loan receivables were
denominated in Australian Dollars, British Pounds and US
Dollars.
Weighted Floating Interest Fixed Interest Non-interest bearing Total
Average Rate Maturing
Effective
Interest Rate
2019 2018 2019 2018 2019 2018 2019 2018 2019 2018
% % US$ US$ US$ US$ US$ US$ US$ US$
Financial Assets:
Cash and
cash
equivalents 1.8% 1.8% 880,681 3,945,683 - - - - 880,681 3,945,683
Trade and
other
receivables - - - - - - 157,827 7,127,150 157,827 7,127,150
Total
financial
assets 880,681 3,945,683 - - 157,827 7,127,150 1,038,508 11,072,833
Financial Liabilities:
Trade and
other
payables 10% 10% - - 44,878,830 44,602,782 918,937 15,768,503 45,797,767 60,371,285
Borrowings 6% 6% - - 46,151,690 44,039,606 - - 46,151,690 44,039,606
Total
financial
liabilities - - - - 91,030,520 88,642,388 918,937 15,768,503 91,949,457 104,410,891
Profile
At the reporting date, the interest rate profile of the Group's
financial instruments which exposes the group to cash flow interest
rate risks are:
Sensitivity analysis for variable rate instruments
The sensitivity on interest rates for 2019 and 2018 assumes a
change of 100 basis points in the interest rates at the reporting
date and would have increased / (decreased) profit or loss by the
amounts shown. Both analyses for each year assume that all other
variables, in particular foreign currency rates, remain
constant.
Group Weighted 2019 2019 Weighted 2018 2018
Average Average
Interest +100 -100 Interest +100 -100
Rate bps bps Rate bps bps
% US$ US$ % US$ US$
Variable rate instruments
Financial assets
(cash and cash equivalents) 1.8% - - 1.8% - -
Financial assets - - - - - -
(loan and receivables)
Fair values versus carrying amounts
The fair value of financial assets and liabilities, together
with the carrying amounts shown in the statement of financial
position, are as follows:
Group 30 June 2019 30 June 2018
US$ US$
Carrying amount Fair value Carrying Fair
amount value
Trade and other
receivables 157,827 157,827 7,127,150 7,127,150
Cash and cash
equivalents 880,681 880,681 3,945,683 3,945,683
Trade and other
payables (45,797,767) (45,797,767) (60,371,285) (60,371,285)
Borrowings (46,151,690) (46,151,690) (44,039,606) (44,039,606)
Total (91,949,457) (91,949,457) (93,338,058) (93,338,058)
The basis for determining fair value is disclosed in Note
1(n).
Other price risks
The Group is not exposed to any other price risks.
Capital management
The entity's objectives when managing capital is to safeguard
its ability to continue as a going concern, so that it can continue
to provide returns for shareholders and to maintain an optimal
capital structure to reduce the cost of capital.
The entity's overall strategy remains unchanged from 2018.
The capital structure of the group consists of cash and cash
equivalents and equity attributable to equity holders of the
Company, comprising issued capital, reserves and accumulated losses
as disclosed in Notes 24 and 25 respectively. None of the entities
within the group are subject to externally imposed capital
requirements.
Gearing ratio
The Board reviews the capital structure on an annual basis. As a
part of this review the Board considers the cost of capital and the
risks associated with each class of capital.
Note Consolidated
2019 (US$) 2018 (US$)
Financial assets
Cash and cash equivalents 10 880,681 3,945,683
Other financial assets - 2,800,000
Financial liabilities
Trade and other payables 19 (46,122,509) (60,371,285)
Borrowings 20 (46,151,690) (44,602,782)
Net debt (92,274,199) (104,974,067)
Equity (39,516,245) 4,443,822
Net debt to equity ratio N/A 2,197.8%
Categories of financial instruments
Note Consolidated
2019 (US$) 2018 (US$)
Financial assets
Cash and cash equivalents 10 880,681 3,945,683
Trade and other receivables
- non-current - 2,251,384
Trade and other receivables
- current 11 157,827 4,875,766
Total 1,038,508 11,072,833
Financial liabilities
Trade and other payables 19 45,797,767 60,371,285
Borrowings 20 46,151,690 44,039,606
Option liability - 33,345
Total 91,949,457 104,444,236
The carrying amount reflected above represents the Group's
maximum exposure to credit risk for such loans and receivables.
(a) Fair value hierarchy
AASB 13 requires disclosure of fair value measurements by level
of the following fair value measurement hierarchy:
(a) Quoted prices (unadjusted) in active markets for identical
assets or liabilities (level 1),
(b) Inputs other than quoted prices included within level 1 that
are observable for the asset or liability, either directly or
indirectly (level 2), and
(c) Inputs for the asset or liability that are not based on
observable market data (unobservable inputs (level 3).
The following table presents the Group's financial assets and
financial liabilities measured and recognised at fair value at 30
June 2018 and 30 June 2017 on a recurring basis.
At 30 June 2019 Level Level Level Total
1 2 3
US$ US$ US$
Assets
Financial asset measured
at Fair Value through profit
and loss
Equity securities - - - -
Total assets - - - -
Liabilities
Option liability at fair - - - -
value through profit or
loss
Derivative liability at
fair value through profit
or loss - 113 - 113
Total liabilities - 113 - 113
At 30 June 2018 Level Level Level Total
1 2 3
US$ US$ US$
Assets
Financial asset measured
at Fair Value through profit
and loss
Equity securities - - - -
Total assets - - - -
Liabilities
Option liability at fair
value through profit or
loss - 33,345 - 33,345
Derivative liability at
fair value through profit
or loss - 384,007 - 384,007
Total liabilities - 417,352 - 417,352
The Group's policy is to recognise transfers into and transfers
out of fair value hierarchy levels as at the end of the end of the
reporting period. There were no transfers between the levels of the
fair value hierarchy during the year ended 30 June 2019.
(b) Fair values of other financial instruments
The Group has financial instruments which are measured at
amortised cost in the consolidated statement of financial
position.
Due to their short-term nature, the carrying amounts of the
current receivables, current payables, current borrowings, and
current other financial liabilities is assumed to approximate their
fair value.
(c) Fair values of non-current receivables, payables and
borrowings
For non-current receivables, payables and borrowings, the fair
values are not materially different to their carrying amounts since
the interest on these balances is close to current market
rates.
Note 34: Events after the reporting date
Conditional Sale and Purchase Agreement with LandOcean Energy
Services
On 2 September 2019, the parties have successfully signed a
binding conditional Sale and Purchase Agreement for the sale of
Range Resources Trinidad Limited to LandOcean in exchange for
offsetting all outstanding debt and payables (including the
convertible note) due from Range and its subsidiaries to LandOcean
and its subsidiaries, and a cash consideration of US$2,500,000
million. This is conditional upon Range shareholders' approval,
LandOcean shareholders' approval and Trinidad and Tobago government
approval. There is no guarantee the transaction will complete.
Director resignation
Ms Juan Wang has tendered her resignation as Non-Executive
Director of the Company on 23 July 2019. Ms Wang was appointed to
the Board of the Company in 2014 as a nominee of Abraham Ltd,
pursuant to Abraham's contractual right to appoint up to two
Non-Executive Directors to the Board as part of its investment in
Range in 2014, as long as it holds 8% or more of the Company's
shares on issue (as announced on 15 May 2014). As Abraham's
shareholding in the Company is currently below 8%, it no longer has
the right to have any nominee Directors on the Board of the
Company.
Placement GBP750k
The Group has completed a subscription agreement to raise
GBP750,000 with a new investor, Sramek BioDynamics Holdings
Limited. Pursuant to the Subscription, the Group issued
1,536,599,792 new ordinary shares at a price of 0.049 pence per new
ordinary share. The subscription shares represent 15% of the issued
ordinary share capital of the Group prior to the subscription which
was undertaken under the Company's available 15% placement capacity
under ASX Listing Rule 7.1. The shares were admitted on AIM on 20
September 2019.
VAT refund - Trinidad
In September, the Group received a VAT refund from the Board of
Inland Revenue in Trinidad and Tobago of US$1.03 million.
Other than the above, no events occurred after the reporting
date.
Note 35: New accounting Standards and interpretations
Australian accounting Standards/amendments released but not yet
effective: 30 June 2019 year end
Certain new accounting Standards and Interpretations have been
published that are not mandatory for 30 June 2019 reporting periods
and have not been early adopted by the Group. The Group's
assessment of the impact of these new Standards and Interpretations
is set out below. In all cases the Group intends to apply these
standards from the application date as indicated in the tables
below.
Reference: AASB 16 Title: Leases
Standard application 1 January 2019
date:
Group application date: 1 July 2019
Key Requirements
The key features of AASB 16 are as follows:
Lessee accounting
* Lessees are required to recognise assets and
liabilities for all leases with a term of more than
12 months, unless the underlying asset is of a low
value.
* A lessee measures right-of-use assets similarly to
other non-financial assets and lease liabilities
similarly to other financial liabilities.
* Assets and liabilities arising from a lease are
initially measured on a present value basis. The
measurement includes non-cancellable lease payments,
and also includes payments to be made in optional
periods if the lessee is reasonably certain to
exercise an option to extend the lease, or not to
exercise an option to terminate the lease.
* AASB 16 contains disclosure requirements for leases.
Lessor accounting
AASB 16 substantially carries forward the lessor accounting
requirements in AASB 117. Accordingly, a lessor continues
to classify its leases as operating leases or finance leases,
and to account for those two types of leases differently.
AASB 16 also requires enhanced disclosures to be provided
by lessors that will improve information disclosed about
a lessor's risk exposure, particularly to residual value
risk.
Impact
Management have assessed AASB 16 and do not expect any significant
impact on the Group.
There are no other standards that are not yet effective and that
would be expected to have a material impact on Range in the current
or future period and on foreseeable future transactions.
Note 36: Company details
The registered office of the company is:
c/o Edwards Mac Scovell, Level 7, 140 St Georges Terrace, Perth
WA 6000
Telephone: +61 8 6205 3012
The principal place of business is:
c/o Edwards Mac Scovell, Level 7, 140 St Georges Terrace, Perth
WA 6000
Telephone: +61 8 6205 3012
+ Directors' Declaration
The directors of the company declare that:
-- The financial statements, comprising the consolidated statement of profit or loss and other comprehensive income, consolidated statement of financial position, consolidated statement of cash flows, consolidated statement of changes in equity, accompanying notes, are in accordance with the Corporations Act 2001 and:
-- comply with Accounting Standards and the Corporations
Regulations 2001 and other mandatory professional reporting
requirements; and
-- give a true and fair view of the Group's financial position
as at 30 June 2019 and of its performance for the year ended on
that date.
-- The company has included in the notes to the financial
statements an explicit and unreserved statement of compliance with
International Financial Reporting Standards.
-- In the directors' opinion, there are reasonable grounds to
believe that the company will be able to pay its debts as and when
they become due and payable.
-- The directors have been given the declarations by the chief
executive officer and chief financial officer required by section
295A.
This declaration is made in accordance with a resolution of the
Board of Directors and is signed for and on behalf of the directors
by:
Zhiwei Gu
Chairman
27 September 2019
+ Independent Audit Report to the Members of Range Resources
Limited
<Intentionally left blank>
+ Reserves and Resources Statement
Reserves
As at 30 June 2019, Range's net proved and probable reserves
(2P) are assessed to be 15.0 million barrels of oil (MMbbl). The
only factor attributing to the revision in reserves is:
-- Production during the period commencing 1 July 2018 up to 30 June 2019
Reserves as at 30 June 2019 (MMbbl):
Category Proved (1P) Proved & probable Proved, probable
(2P) & possible (3P)
Developed 2.9 4.7 6.2
Undeveloped 6.2 10.3 15.5
Total 9.1 15.0 21.7
1. The reserve figures (1P, 2P and 3P) include reserves
associated with the Company's Morne Diablo, South Quarry and Beach
Marcelle licences in Trinidad. Range's net interest in all three
fields is 100%.
2. Competent Persons Report ("CPR") prepared by Rockflow
Resources Ltd, effective 30 June 2017 was used as a basis for
estimation of the reserve figures.
3. Range's Morne Diablo and South Quarry fields are operated
under farm-out agreements, with rights to production net of
Trinidad government royalties, overriding royalties, and production
taxes.
4. Range's Beach Marcelle field is operated under the terms of
an Incremental Production Service Contract, entitling Range to a
defined portion of the future revenue stream. No oil and gas
reserves are owned by Range.
Movement in reserves (MMbbl):
Category Proved (1P) Proved & probable Proved, probable
(2P) & possible (3P)
Reserves as
at 30 June
2018 9.3 15.2 21.9
FY 2018 production -0.2 -0.2 -0.2
Reserves as
at 30 June
2019 9.1 15.0 21.7
Contingent resources
As at 30 June 2019, Range's net contingent resources 2C (P50)
are assessed to be 12.9 million barrels of oil equivalent (MMboe).
The contingent resources remain unchanged due to no material
activities on commercialization of identified contingent resources
in both Trinidad and Indonesia during the past financial year
period commencing 1 July 2018 up to 30 June 2019.
Contingent resources as at 30 June 2019:
Category 1C 2C 3C
Project Gas Oil Total Gas Oil Total Gas Oil Total
Bscf MMbbl MMboe Bscf MMbbl MMboe Bscf MMbbl MMboe
Trinidad
(net 100
%) - 4.6 4.6 - 8.0 8.0 - 15.4 15.4
Indonesia
(net 23%) 1.7 0.9 1.2 10.9 3.1 4.9 41.1 18.4 25.3
Total 1.7 5.5 5.8 10.9 11.1 12.9 41.1 33.8 40.7
1. The Trinidad resource figures (1C, 2C and 3C) include
contingent resources associated with the Company's Morne Diablo,
South Quarry and Beach Marcelle licences in Trinidad. Range's net
interest in all three fields is 100%.
2. The Trinidad resource figures are based on the CPR prepared
by Rockflow Resources Ltd, effective 30 June 2017.
3. The Indonesia resource figures (1C, 2C and 3C) include
contingent resources associated with the Company's interest in the
Perlak field. Range's net interest is 23%.
4. The Indonesia resource figures are based on the CPR prepared
by LEAP Energy Partners Sdn. Bhd, effective 1 August 2017.
5. The conversion factor used for converting gas to oil
equivalent volumes is 6,000 scf to 1 boe.
Movement in contingent resources (MMboe):
Category 1C 2C 3C
Contingent resources
as at 30 June
2018 5.8 12.9 40.7
Revisions +0.0 +0.0 +0.0
Contingent resources
as at 30 June
2019 5.8 12.9 40.7
Notes on calculation of reserves and resources
-- The reserves and resources stated in this report are prepared
in accordance with the definitions and guidelines in the Society of
Petroleum Engineers (SPE) 2007 Petroleum Resources Management
System (PRMS).
-- Range reviews and updates its oil and gas reserves and
resources position on an annual basis and reports the updated
estimates as of 30 June each year. Separately, Range reviews and
updates its oil and gas reserves and resources position as
frequently as required by the magnitude of the petroleum reserves
and resources and changes indicated by new data.
-- The reserve and resource figures are reported according to
Range's net economic interest, net of royalties and net of lease
fuel up to the reference point.
-- The reference point defined as the point of sale to third parties.
-- Petroleum reserves and resources are prepared using
deterministic and probabilistic methods.
-- Project and field totals are aggregated by arithmetic summation by category.
-- Totals may not exactly reflect arithmetic addition due to rounding.
-- Oil and gas reserves estimates are expressions of judgment
based on knowledge, experience and industry practice. Estimates
that were valid when originally calculated may alter significantly
when new information or techniques become available. Additionally,
by their very nature, reserve and resource estimates are imprecise
and depend to some extent on interpretations, which may prove to be
inaccurate. As further information becomes available through
additional drilling and analysis, the estimates are likely to
change. This may result in alterations to development and
production plans which may, in turn, adversely impact the Company's
operations. Reserves estimates and estimates of future net revenues
are, by nature, forward looking statements and subject to the same
risks as other forward-looking statements.
Qualified person review
The information contained in this report has been reviewed and
approved by Mr Lubing Liu. Mr Liu is a suitably qualified person
with 24 years of industry experience. Mr Liu is a full-time
employee of Range and holds a role of a Chief Operating Officer and
Trinidad General Manager. He holds a BSc in Petroleum Engineering
from the Southwest Petroleum University, China and is a member of
the SPE (Society of Petroleum Engineers). Mr Liu is qualified in
accordance with ASX listing rule 5.41 and consents to the use of
petroleum reserve and resource figures in the form and context in
which they appear in this statement.
+ ASX Additional Information
Additional information required by the Australian Securities
Exchange Listing Rules and not disclosed elsewhere in this Annual
Report is set out below.
Top 20 shareholders
The 20 largest shareholders of the Company as at 31 August 2019
are listed below:
Rank Shareholder Number of shares Percentage
held (%)
BEIJING SIBO INVESTMENT MANAGEMENT
1. LP 2,447,620,912 23.89
2. LANDOCEAN ENERGY SERVICES CO LTD 1,739,076,923 16.98
INTERACTIVE INVESTOR SERVICES
3. NOMINEES LIMITED <SMKTNOMS> 728,480,359 7.11
4 ABRAHAM LIMITED 712,377,560 6.95
BARCLAYS DIRECT INVESTING NOMINEES
5. LIMITED <CLIENT1> 556,622,350 5.43
INTERACTIVE INVESTOR SERVICES
6. NOMINEES LIMITED <SMKTISAS> 480,811,795 4.69
HARGREAVES LANSDOWN (NOMINEES)
7. LIMITED <15942> 296,273,980 2.89
8. HSDL NOMINEES LIMITED 287,907,659 2.81
9. HSDL NOMINEES LIMITED <MAXI> 174,183,889 1.70
HARGREAVES LANSDOWN (NOMINEES)
10. LIMITED <VRA> 161,381,580 1.58
HARGREAVES LANSDOWN (NOMINEES)
11. LIMITED <HLNOM> 160,296,133 1.57
HSBC CLIENT HOLDINGS NOMINEE (UK)
12. LIMITED <731504> 151,595,552 1.48
13. SHARE NOMINEES LTD 100,867,728 0.99
14. WEALTH NOMINEES LIMITED <WRAP> 93,529,952 0.91
HSBC CUSTODY NOMINEES (AUSTRALIA)
15. LIMITED 72,716,846 0.71
16. LAWSHARE NOMINEES LIMITED <SIPP> 71,809,408 0.70
17. CITICORP NOMINEES PTY LIMITED 69,947,400 0.68
J P MORGAN NOMINEES AUSTRALIA
18. PTY LIMITED 64,962,626 0.63
19. VIDACOS NOMINEES LIMITED <IGUKCLT> 59,293,575 0.58
20. JIM NOMINEES LIMITED <JARVIS> 58,892,984 0.58
Total 8,488,649,211 82.86
Substantial shareholders
An extract of the Company's register of substantial shareholders
(being those shareholders who held 5% or more of the issued capital
on 31 August 2019) is below:
Shareholder Number of shares Percentage held (%)
BEIJING SIBO INVESTMENT MANAGEMENT LP 2,447,620,912 23.89
LANDOCEAN ENERGY SERVICES CO LTD 1,739,076,923 16.98
INTERACTIVE INVESTOR SERVICES NOMINEES LIMITED <SMKTNOMS> 728,480,359 7.11
ABRAHAM LIMITED 712,377,560 6.95
BARCLAYS DIRECT INVESTING NOMINEES LIMITED <CLIENT1> 556,622,350 5.43
Distribution of equity securities
There were 2,499 holders of less than a marketable parcel of
ordinary shares (being 165,777,662 shares on 31 August 2019).
The number of shareholders by size of holding is set out
below:
Size of holding Number of holders Number of shares
1 - 1,000 215 69,850
1,001 - 5,000 335 1,041,441
5,001 - 10,000 298 2,424,646
10,001 - 100,000 1,159 54,448,501
100,001 and over 921 10,186,014,177
Total 2,928 10,243,998,615
Tenement schedule
The tenement schedule for the Group as at 30 June 2019 is
tabulated below:
Tenement Reference Location Percentage held Operator
(%)
Morne Diablo Trinidad 100 Range
South Quarry Trinidad 100 Range
Beach Marcelle Trinidad 100 Range
St Mary's Block Trinidad 80 Range
Perlak(1) Indonesia 23 PT Aceh Timur
Kawai Energi
Notes:
1. Range's indirect interest in the Perlak field is held through
its 60% shareholding in Hengtai, which holds a 78% interest in
Lukar which in turn holds a 49% interest in PT Aceh Timur Kawai
Energi.
2. The Production Sharing Contracts relating to Guayaguayare
Deep and Shallow expired in 2015. Any renewal will be subject
(inter alia) to government and other regulatory approvals.
+ Corporate Directory
Directors Zhiwei Gu Executive Chairman
Lubing Liu Executive Director and COO
Dr Mu Luo Non-Executive Director
Company Secretary Evgenia Bezruchko and Sara Kelly
Registered office c/o Edwards Mac Scovell, Level 7, 140 St Georges
& principal place Terrace
of business Perth WA 6000, Australia
Telephone: +61 8 6205 3012
Share Registry Computershare Investor Services Pty Ltd
(Australia) Level 11, 172 St Georges Terrace, Perth WA
6000
Telephone: +61 3 9415 4000
Share Registry Computershare Investor Services plc
(United Kingdom) PO Box 82, The Pavilions, Bridgwater Road,
Bristol, UK BS99 6ZZ
Telephone: +44 370 702 0000
Auditor BDO Audit (WA) Pty Ltd, 38 Station Street;
Subiaco WA 6008, Australia
Stock Exchange Range Resources Limited shares are listed
Listing on the Australian Securities Exchange (ASX
code: RRS) and
Alternative Investment Market of the London
Stock
Exchange (AIM code: RRL)
Country of Incorporation Australia
Website www.rangeresources.co.uk
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
FR SEASMWFUSELU
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September 27, 2019 03:00 ET (07:00 GMT)
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