Review of financial position The net assets increased by $15,820,332 to $52,992,594 at 30 June 2023 (30 June 2022: $37,172,262). During the year, the Consolidated Entity capitalised $8,140,867 (2022: $9,532,768) on exploration, mainly in relation to Block 9 in Cuba. The main determinants of the Consolidated Entity’s financial condition were: – Loss after tax of $1,001,999 (2022: profit of $6,332,812); – Increase in share capital amounting to $17,295,207 (2022: $22,875,044). The working capital position as at 30 June 2023 of the Consolidated Entity results in an excess of current assets over current liabilities of $33,859,932 (30 June 2022: $26,450,132). The cash balances, including term deposits, as at 30 June 2023 were $34,976,625 (2022: $35,570,347). Corporate The Consolidated Entity’s future prospects are centred on its ability to secure quality exploration, development and producing opportunities and seeking to maximise the value to shareholders of its current portfolio, identifying and securing additional value-accretive projects, and/or undertaking a corporate transaction. Funding for the coming Financial Year is sufficient to meet the Company’s forecast exploration and field development commitments however the Consolidated Entity may raise additional funding either through farm-in/sale and/or capital injection to advance its projects. In the event that the Consolidated Entity cannot meet its share of work program commitments, permits may need to be surrendered. Significant changes in the state of affairs On 8 July 2022 the Company reported that independent reserves and resources expert McDaniel & Associates estimated the Alameda formation within Block 9, Cuba (encountered by the Alameda-1 exploration well) contained 1.9 billion barrels of oil in place and a Prospective Resource1 of 109 million barrels of oil (Best Estimate, 100% basis). On 1 August 2022 the Company reported that independent reserves and resources expert McDaniel & Associates estimated the Marti formation within Block 9, Cuba (encountered by the Alameda-1 exploration well) contained 1.2 billion barrels of oil in place and a Prospective Resource1 of 70 million barrels of oil (Best Estimate, 100% basis). On 10 September 2022, the Company’s listed call options (ASX: MAYO) with a strike of $0.035 expired. Of the 459,758,321 options outstanding at the start of the reporting period, 453,202,268 were exercised on or prior to the expiry date resulting in payments to the Company of $17,295,207. On 27 October 2022 the Company reported that its exploration well Zapato-1 being drilled in Block 9, Cuba, had reached planned total depth of 3,150 metres measured depth but had not reached the target formation. On 15 November 2022 the Company announced its plans to drill two appraisal wells in Block 9, Cuba, to better understand the oil qualities and reservoir characteristics of the three geologically independent formations containing moveable hydrocarbons encountered whilst drilling Alameda-1. On 7 December 2022 the Company announced it had appointed an Exploration Manager, a General Counsel and a new Chief Financial Officer. On 20 February 2023 the Company announced a small holding share facility to about 2,100 eligible holders with small parcels of shares the opportunity to sell their shareholding without incurring brokerage or handling costs. On 3 March 2023 it was announced that the Company’s ordinary shares listed on the ASX were to be included in the All Ordinaries index, effective 10 March 2023. On 19 April 2023 the Company received the approval of the National Offshore Petroleum Titles Administrator for a 24-month suspension of the permit conditions in respect of the Permit Year 1 - 3 work program (with a corresponding 24-month extension of the permit term) for its exploration permit AC/P70. On 6 June 2023 the Company announced it had appointed a Chief Commercial Officer. On 20 June 2023 the Company announced the start of drilling of its Alameda-2 appraisal well, the first of two appraisal wells planned to better understand the multiple significant hydrocarbon bearing zones intercepted during the drilling of Alameda-1 in its Block 9 PSC onshore Cuba. As at 30 June 2023, the Company had no outstanding granted options. 17 Melbana Energy Limited Annual Report 2023
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