Prospectus re Admission to the Official List - Heritage Oil

More documents

Recommendations

Info

During the nine-month period ended 30 September 2007, the weighted average share price at the dateof option exercise was Cdn $41.97. (Cdn $18.36 during the nine-month period ended 30 September2006).The fair value of each stock option grant on the date of grant was estimated using the Black-Scholesoption-pricing model with the following weighted average assumptions and results. The fair value ofstock options is amortised over the vesting period of the option.31 December 30 September2005 2006 2006 2007$ $ $ $(Unaudited)Weighted average assumption and resultsRisk free interest rate (%) ........................... 2.81 4.13 2.12 4.55Volatility (%) .................................... 58.86 42.99 62.40 45.00Dividend yield (%) ................................ — — — —Expected life (years) ............................... 3.80 3.42 5.00 3.00Grant date fair value (Cdn $) ........................ 3.93 8.80 9.11 32.1923 Derivative financial liability31 December 30 September2005 2006 2006 2007$ $ $ $(Unaudited)Convertible bond — conversion option ........ — 27,997,140 8,621,068 32,810,103For details of the convertible bond, refer to note 17.The fair value of the convertible bonds conversion option has been estimated using the Black-Scholesoption-pricing model at each period end, with changes in the fair value of the conversion optionrecognised in income during the period. The expected life of the conversion option has been adjustedto reflect the bondholders’ put option and the Corporation’s redemption option as detailed in note 17.24 Related party transactionsDuring the nine-month period ended 30 September 2007, general and administrative expensesincluded an advisory fee of $806,607 (30 September 2006—$644,258) charged by Mr. AnthonyBuckingham, a director of the Corporation who was appointed CEO on 6 October 2006.Mr. Atherton, a director of the Corporation, is also a director and CFO of Sea Dragon. The Groupacquired 605,000 common shares of Sea Dragon on 9 March 2007 through the sale of its 65% interestin Pipelay and Naturalay Technologies.In 2006, general and administrative expenses included an advisory fee of $1,494,317 (2005—$877,686)charged by the same director. In 2005, the Corporation established a management and finance officein Switzerland that required this same director to relocate; he received a relocation allowanceof $275,918.208
25 Commitments and contingenciesHeritage’s net share of outstanding contractual commitments at 30 September 2007 was estimated at:Less thanAfterTotal 1 year 1-3 years 4-5 years 5 years$’000 $’000 $’000 $’000 $’000Long-term debt ......................... 17,662 617 1,234 8,334 7,477Convertible bonds ....................... 158,000 — — 158,000 —Total repayments of borrowings ............. 175,662 617 1,234 166,334 7,477Operating leases ........................ 9,642 229 458 458 8,497Other long-term obligations ................ 140,000 40,000 100,000 — —Work program obligations ................. 124,759 58,236 52,259 14,065 200Total contractual obligations ................ 274,401 98,465 152,717 14,523 8,697The Corporation may have a potential residual obligation to satisfy any shortfall in officers’ andformer officers’ secured real estate borrowings in the event of default, a shortfall on the proceedsfrom the disposal of the properties and the individuals being unable to repay the balance. The value ofthe residual obligation was estimated as insignificant.On 6 October 2006, the Corporation released Mr. Micael Gulbenkian from his role as its Chairmanand Chief Executive Officer.In many of the countries in which the Group operates, land title systems are not developed to theextent found in many industrial countries and there may be no concept of registered title. Althoughthe Group believes that it has title to its oil and gas properties, it cannot control or completely protectitself against the risk of title disputes or challenges. There can be no assurance that claims orchallenges by third parties against the Group’s properties will not be asserted at a future date. TheGroup received a letter from the Iraq Ministry of Oil dated 17 December 2007 stating that theProduction Sharing Contract (‘‘PSC’’) signed with the Kurdistan Regional Government (‘‘KRG’’)without the prior approval of the Iraqi government) is considered to be void by the Iraqi governmentas they have stated it violates the ‘‘prevailing Iraqi law’’. On the basis of the KRI legal advice, theDirectors believes that the PSC is valid and effective pursuant to the applicable laws.In addition, the DRC work programme pursuant to the DRC PSC cannot be commenced prior to thegrant of a presidential decree from the DRC government. There can be no assurance that finalapproval or ratification will ever be received in respect of the DRC PSC or that the pre-agreed fiscalterms will not be re-negotiated at a later date by the DRC government.Furthermore, the Group received a letter from the chairman of the Management Committee of theNational Oil Corporation of Libya dated 28 February 2008 stating that the Block 7 licence area lieswithin the Libyan continental shelf and a portion of this area has already been licensed to Sirte OilCompany. This letter also demands that the Group refrain from any activities over or concerning theBlock 7 licence area and asserts the Libyan government’s right to invoke Libyan and international lawto protect its rights in the Block 7 licence area. The Directors believe that the Libyan government’sclaims are unfounded.209
Page 1 and 2:
This document comprises a prospectu
Page 3 and 4:
SUMMARY INFORMATIONThis summary mus
Page 5 and 6:
Summary Consolidated Income Stateme
Page 7 and 8:
Summary Consolidated Cash Flow Stat
Page 9 and 10:
Production from the Zapadno Chumpas
Page 11 and 12:
Given the geographic spread of the
Page 13 and 14:
RISK FACTORSAny investment in the O
Page 15 and 16:
wells may change as a result of low
Page 17 and 18:
which could have a materially adver
Page 19 and 20:
Failure to obtain additional financ
Page 21 and 22:
contractual or pricing terms, both
Page 23 and 24:
years. In addition, since December
Page 25 and 26:
UgandaUganda is among the poorest c
Page 27 and 28:
Market Price of the Ordinary Shares
Page 29 and 30:
DIRECTORS, CORPORATE SECRETARY, SEN
Page 31 and 32:
EXPECTED TIMETABLE OF PRINCIPAL EVE
Page 33 and 34:
CurrenciesAll references in this do
Page 35 and 36:
PART I—INFORMATION ON THE GROUPOV
Page 37 and 38:
Strong management and technical tea
Page 39 and 40:
the availability of existing infras
Page 41 and 42:
In 2005, the Group acquired a 95 pe
Page 43 and 44:
The Group acquired a 10 per cent. i
Page 45 and 46:
The Group is the operator and has a
Page 47 and 48:
exploration wells. The total estima
Page 49 and 50:
The Group has also entered into a s
Page 51 and 52:
Pakistan has current proved hydroca
Page 53 and 54:
operational by drawing up an Enviro
Page 55 and 56:
Mr. Buckingham has never had any as
Page 57 and 58:
Date2007 ........ On 18 January 200
Page 59 and 60:
(3) One common share of Heritage Ho
Page 61 and 62:
(f) General Sir Michael WilkesGener
Page 63 and 64:
Remuneration CommitteeThe Remunerat
Page 65 and 66:
Goldsworth House, Denton Way, Golds
Page 67 and 68:
ResourcesA summary of the gross Con
Page 69 and 70:
The post tax Net Present Value (NPV
Page 71 and 72:
RPS EnergyHeritage Oil - Competent
Page 73 and 74:
Page 75 and 76:
Page 77 and 78:
Page 79 and 80:
Page 81 and 82:
Page 83 and 84:
Page 85 and 86:
Page 87 and 88:
Page 89 and 90:
Page 91 and 92:
Page 93 and 94:
Page 95 and 96:
Page 97 and 98:
Page 99 and 100:
Page 101 and 102:
Page 103 and 104:
Page 105 and 106:
Page 107 and 108:
Page 109 and 110:
Page 111 and 112:
Page 113 and 114:
Page 115 and 116:
Page 117 and 118:
Page 119 and 120:
Page 121 and 122:
Page 123 and 124:
Page 125 and 126:
Page 127 and 128:
Page 129 and 130:
Page 131 and 132:
Page 133 and 134:
Page 135 and 136:
Summary Consolidated Balance Sheets
Page 137 and 138:
Summary Consolidated Balance Sheets
Page 139 and 140:
locks during the first three and a
Page 141 and 142:
On 2 October 2007, the Group execut
Page 143 and 144:
of amplitude anomalies, further sup
Page 145 and 146:
The increase in operating expenses
Page 147 and 148:
5.11 Discontinued OperationsThe res
Page 149 and 150:
6. RESULTS OF CONTINUING OPERATIONS
Page 151 and 152:
6.7 Foreign Exchange LossesThere wa
Page 153 and 154:
6.14 Capital ExpendituresThe follow
Page 155 and 156:
7.3 Petroleum and Natural Gas Reven
Page 157 and 158:
7.14 Capital ExpendituresAdditions
Page 159 and 160: 10. LIQUIDITY AND CAPITAL RESOURCES
Page 161 and 162: Year Ended 31 December 2005 Prepare
Page 163 and 164: Intangible E&E assets related to ea
Page 165 and 166: 11.2 The year ended 31 December 200
Page 167 and 168: (c) Reconciliation of loss for the
Page 169 and 170: Year Ended 31 December 2004 Prepare
Page 171 and 172: PART VII—FINANCIAL INFORMATIONA.
Page 173 and 174: DeclarationFor the purposes of Pros
Page 175 and 176: HERITAGE OIL LIMITEDNOTES TO BALANC
Page 177 and 178: AUDITED AND UNAUDITED FINANCIAL INF
Page 179 and 180: HERITAGE OIL CORPORATIONCONSOLIDATE
Page 183 and 184: HERITAGE OIL CORPORATIONNOTES TO CO
Page 185 and 186: Intangible E&E assets related to ea
Page 187 and 188: k) InvestmentsThe Group classifies
Page 189 and 190: usually when legal title passes to
Page 191 and 192: iii) IFRIC 12, ‘‘Service conces
Page 193 and 194: v) Liquidity riskLiquidity risk is
Page 195 and 196: ii) DerivativesDerivatives are reco
Page 197 and 198: 5 Other finance costsNine-month per
Page 199 and 200: Congo to the other partners in the
Page 201 and 202: No assets have been pledged as secu
Page 203 and 204: 31 December 30 September2005 2006 2
Page 205 and 206: 16 Trade and other payables31 Decem
Page 207 and 208: A reconciliation of the asset retir
Page 209: 21 Loss per shareThe following tabl
Page 213 and 214: In November 2007, the Group farmed-
Page 215 and 216: Reconciliation of loss for the year
Page 217 and 218: At the end of the last reporting pe
Page 219 and 220: Reconciliation of cash flow stateme
Page 221 and 222: At 31 December 2006, this has resul
Page 223 and 224: AUDITED FINANCIAL STATEMENTS RELATI
Page 225 and 226: AUDITORS’ REPORT TO THE SHAREHOLD
Page 229 and 230: HERITAGE OIL CORPORATIONNOTES TO CO
Page 231 and 232: effective as hedges, both at incept
Page 233 and 234: A ceiling test was undertaken at De
Page 235 and 236: 6. Share capital:(a) Authorized:Unl
Page 237 and 238: fair value of stock options are amo
Page 239 and 240: C. PRO FORMA FINANCIAL INFORMATION
Page 241 and 242: PRO FORMA NET ASSET STATEMENTThe fo
Page 243 and 244: Production assumptionsProduction du
Page 245 and 246: Macroeconomic assumptionsThe Direct
Page 247 and 248: Accordingly, the Illustrative Proje
Page 249 and 250: Arrangement AgreementPursuant to th
Page 251 and 252: PART X—ADDITIONAL INFORMATION1. R
Page 253 and 254: (ii) no share or loan capital of th
Page 255 and 256: (j)In Alberta, the principal jurisd
Page 257 and 258: nominal amount has been paid up of
Page 259 and 260: instrument of transfer (in the case
Page 261 and 262:
up on all the shares conferring tha
Page 263 and 264:
(B) may be a director or other offi
Page 265 and 266:
and is in default for a period of 1
Page 267 and 268:
(c)have sufficient moneys, assets o
Page 269 and 270:
(e)against surrender of the Exchang
Page 271 and 272:
e, to the extent that the same is r
Page 273 and 274:
(g)(ii) by arranging for the credit
Page 275 and 276:
(b) rights, options or warrants oth
Page 277 and 278:
any provision of provincial, territ
Page 279 and 280:
7.5 None of the major shareholders
Page 281 and 282:
Position stillDirector/Senior Manag
Page 283 and 284:
employment or terminates his or her
Page 285 and 286:
All rights of a holder of Exchangea
Page 287 and 288:
agreement of this nature. These cir
Page 289 and 290:
to change. Where the Company pays a
Page 291 and 292:
As part of an agreement reached in
Page 293 and 294:
(x) Foreign Property Information Re
Page 295 and 296:
19. DOCUMENTS AVAILABLE FOR INSPECT
Page 297 and 298:
declared and unpaid dividends on ea
Page 299 and 300:
‘‘DTR’’‘‘DutchCo’’
Page 301 and 302:
‘‘ISIN’’‘‘ITA’’‘
Page 303 and 304:
anniversary of the Effective Date a
Page 305 and 306:
‘‘Support Agreement’’‘‘
Page 307:
emaining quantities recovered will
show all

Prospectus re Admission to the Official List - Heritage Oil

Create successful ePaper yourself

Delete template?

Save as template?