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Wentworth Resources Limited : 2014 Full Year Results

PRESS RELEASE
16 March 2015

Wentworth Resources Limited

("Wentworth" or the "Company")

2014 Full Year Results

Wentworth Resources Limited, the Oslo Stock Exchange (WRL.OL) and London Stock Exchange (WRL.L) listed independent, East Africa-focused oil & gas company, today announces its audited financial results for the year ended 31 December 2014.

The following should be read in conjunction with the 2014 Management Discussion and Analysis ("MD&A") and Consolidated Financial Statements which are available on the Company`s updated website at http://www.wentworthresources.com.

Further to the announcement of 26 February 2015 regarding the unaudited Q4 2014 Financial Statements and MD&A, an independent reserves assessment of the Company`s Tanzanian gas assets was completed and announced on 9 March 2015 and an Annual Statement of Reserves 2014 has been included in the 2014 MD&A.

2014 HIGHLIGHTS

Corporate

  • Landmark year in the development of the Company following execution of gas sales and purchase agreement ("GSA") with the Government of Tanzania.

  • GSA to supply discovered natural gas from the Mnazi Bay Concession at a price of US$3.00 per mmbtu (approximately US$3.07 per mscf) escalating at US CPI annually over a seventeen year term.

  • Independent reserves attributed to the Company`s Mnazi Bay gas fields for the first time.

  • Poised for first production into pipeline and substantial free cash flow in 2015.

  • The new (Government owned) Mtwara to Dar es Salaam pipeline and gas processing facilities are nearly complete with delivery of first gas for commissioning anticipated to occur in April 2015. Sales of Mnazi Bay gas to the new pipeline are expected to ramp up to 80 mmscf/day (gross) commencing Q3 2015.

Financial

  • Net income in 2014 of $15.28 million ($0.10 per share) compared to a 2013 net loss of $9.99 million (($0.11) per share).

  • Recognized a non-recurring, non-cash reversal of $23.80 million of previously impaired oil and gas assets in the Mnazi Bay Concession due to the signing of the GSA and near completion of pipeline and infrastructure.

  • Revenue of $1.06 million, up 11% from 2013, due to increasing gas sales volumes at a fixed price of $5.36 per mmbtu to an 18 megawatt power plant in Mtwara, Tanzania.

  • Exploration and development capital expenditures of $22.87 million and $3.53 million respectively compared to $6.05 million and $0.98 million respectively in 2013.

  • Secured credit facilities totaling $26 million, of which $6 million was drawn down in December 2014 and used to repay a $6 million credit facility with Vitol Energy.

  • Cash and cash equivalents on hand of $5.49 million at 31 December 2014 compared with $37.68 million, including short-term deposits, on hand at 31 December 2013.

  • Working capital at 31 December 2014 of $15.84 million compared to $38.37 million at 31 December 2013.

Operational

Mnazi Bay Block, Tanzania

  • Completed acquisition and processing of 315km of conventional 2D seismic over prospective areas in south and southwestern portion of the block.

  • Completed acquisition and processing of 58km of high resolution 2D seismic over the Mnazi Bay and Msimbati gas fields.

  • Commenced design and construction of field infrastructure to connect Mnazi Bay to the new transnational government pipeline project.

  • Continuing interpretation of seismic and drilling data to support the ongoing development plan and exploration opportunities.

  • Commenced planning for drilling operations of the fifth (MB-4) development well which is expected to spud in March, complete by June and is expected to initially produce 20mmscf/day (gross).

Rovuma Onshore Block, Mozambique

  • The Tembo-1 exploration well reached a total depth of 4,553 meters and was plugged and abandoned in December 2014. A discovery in the Cretaceous indicated 11 meters of natural gas net pay and well results are currently being evaluated to assess the potential commerciality of this discovery.

  • The drilling rig was moved from the Tembo-1 location to the Kifaru-1 exploration well location in December and drilling operations at Kifaru-1 commenced in January 2015.

  • The Kifaru-1 well was drilled to a total depth of 3,100 metres, failed to find an economic reservoir and was plugged and abandoned on 23 February 2015.

  • Licence partners are evaluating all data collected to determine the next steps in the exploration phase of the Onshore Rovuma Block.

Geoff Bury, Managing Director, commented:
"We are very pleased that we now have reserves associated with our Mnazi Bay concession. This is a further step towards bringing our gas on stream and follows on from the signing of our gas sales agreement last year, and the ongoing implementation of the field infrastructure. With the government pipeline project on track for a Q2 2015 commissioning, Wentworth now has a defined market for its Mnazi Bay gas and is within a few months of commencing first production into the pipeline, which should generate significant free cash flow in 2015."

Enquiries:

Wentworth

Lance Mierendorf,
Chief Financial Officer

lance.mierendorf@wentworthresources.com
+1 403 680 8773

Katherine Roe
Head of Investor Relations & Corporate Communications

katherine.roe@wentworthresources.com
+44 7841 087 230

Swedbank First Securities

Broker(Norway)

+47 23 23 80 00

Ove Gusevik

Jarand Lønne

Crux Kommunikasjon

Investor Relations Adviser
(Norway)

+47 995 138 91

Jan Petter Stiff

Carl Bachke

Panmure Gordon

AIM Nominated Adviser and Broker (UK)

+44 (0) 20 7886 2500

Dominic Morley

Adam James

FirstEnergy Capital

Broker (UK)

+44 (0) 20 7448 0200

Travis Inlow

Investec

Broker (UK)

+44 (0) 20 7597 4000

Chris Sim

Instinctif Partners

Investor Relations Adviser (UK)

+44 (0) 20 7457 2020

David Simonson
Anca Spiridon

Consolidated Financial Statements

The following primary statements have been extracted from the 2014 consolidated financial statements which are located on the Company`s website at www.wentworthresources.com.

WENTWORTH RESOURCES LIMITED
Consolidated Statement of Financial Position
United States $000s, unless otherwise stated

December 31,
2014

December 31,
2013

ASSETS

Current assets

Cash and cash equivalents

5,487

14,501

Short-term investments

-

23,176

Trade and other receivables

2,613

1,845

Prepayments, deposits and advances to partners

1,418

1,674

Current portion of long-term receivables

14,530

658

24,048

41,854

Non-current assets

Long-term receivables

19,472

28,661

Exploration and evaluation assets

33,762

50,636

Property, plant and equipment

85,035

18,498

138,269

97,795

Total assets

162,317

139,649

LIABILITIES

Current liabilities

Trade and other payables

8,204

3,487

8,204

3,487

Non-current liabilities

Long-term loans

5,718

3,816

Contingent long-term liabilities

2,271

2,836

Decommissioning provision

782

685

8,771

7,337

Equity

Share capital

404,225

403,998

Equity reserve

24,916

23,903

Accumulated deficit

(283,799)

(299,076)

145,342

128,825

Total liabilities and equity

162,317

139,649

WENTWORTH RESOURCES LIMITED
Consolidated Statement of Comprehensive Income/(Loss)
United States $000s, unless otherwise stated

Year ended December 31,

2014

2013

Total revenue

1,060

955

Operating expenses

Production and operating

(2,592)

(1,656)

General and administrative

(6,826)

(7,931)

Share based compensation

(1,090)

(362)

Depreciation and depletion

(542)

(451)

Gain from sale of office assets

60

-

Reversal of impairment on exploration and evaluation assets

13,384

-

Reversal of impairment on property, plant and equipment

10,421

-

Income/(loss) from operating activities

13,875

(9,445)

Gain on derivative financial liability

-

610

Finance income

5,914

5,266

Finance costs

(4,512)

(6,420)

Net income/(loss) and comprehensive loss

15,277

(9,989)

Net income/(loss) per ordinary share

Basic and diluted (US$/share)

0.10

(0.11)

WENTWORTH RESOURCES LIMITED
Consolidated Statement of Changes in Equity
United States $000s, unless otherwise stated

Number of shares

Share capital

Equity reserve

Accumulated deficit

Total equity

$

$

$

$

Balance at December 31, 2012

82,503,940

361,675

21,996

(289,087)

94,584

Net loss and comprehensive loss

-

-

-

(9,989)

(9,989)

Reclassification of warrants

-

-

1,678

-

1,678

Share based compensation

-

-

362

-

362

Issue of share capital

71,368,760

46,200

(133)

-

46,067

Share issue costs

-

(3,877)

-

-

(3,877)

Balance at December 31, 2013

153,872,700

403,998

23,903

(299,076)

128,825

Balance at December 31, 2013

153,872,700

403,998

23,903

(299,076)

128,825

Net income and comprehensive income

-

-

-

15,277

15,277

Share based compensation

-

-

1,090

-

1,090

Issue of share capital

250,000

227

(77)

-

150

Balance at December 31, 2014

154,122,700

404,225

24,916

(283,799)

145,342

WENTWORTH RESOURCES LIMITED
Consolidated Statement of Cash Flows
United States $000s, unless otherwise stated

Year ended December 31,

2014

2013

Operating activities

Net income/(loss) for the year

15,277

(9,989)

Adjustments for:

Share based compensation

1,090

362

Depreciation and depletion

542

451

Finance loss/(income), net

(1,402)

679

Reversal of impairment on exploration and evaluation assets

(13,384)

-

Reversal of impairment on property, plant and equipment

(10,421)

-

Gain from sale of office assets

(60)

-

Gain on derivative financial liability

-

(610)

Change in non-cash working capital

(1,092)

1,288

Cash used in operating activities

(9,450)

(7,819)

Investing activities

Additions to evaluation and exploration assets

(22,869)

(6,045)

Additions to property, plant and equipment

(3,533)

(975)

Short-term investments

23,176

(23,176)

Interest income

100

70

Net (reduction)/increase in long-term receivable

(365)

301

Proceeds from sale of office assets

62

-

Change in non-cash working capital

4,454

1,958

Cash provided by/(used in) investing activities

1,025

(27,867)

Financing activities

Issue of share capital, net of share issue costs

150

42,190

Net proceeds from long-term loan

5,715

9,887

Repayment of long-term loan

(6,000)

(10,036)

Interest paid

(341)

(561)

Repayment of other long-term liabilities

(113)

(645)

Cash (used in)/provided by financing activities

(589)

40,835

Net change in cash and cash equivalents

(9,014)

5,149

Cash and cash equivalents, beginning of the year

14,501

9,352

Cash and cash equivalents, end of the year

5,487

14,501

About Wentworth Resources

Wentworth Resources is a publicly traded (OSE:WRL, AIM:WRL), independent oil & gas company with: natural gas production; midstream assets; a committed exploration and appraisal drilling programme; and large-scale gas monetisation opportunities, all in the Rovuma Delta Basin of coastal southern Tanzania and northern Mozambique.

Cautionary note regarding forward-looking statements

This press release may contain certain forward-looking information. The words "expect", "anticipate", believe", "estimate", "may", "will", "should", "intend", "forecast", "plan", and similar expressions are used to identify forward looking information.

The forward-looking statements contained in this press release are based on management`s beliefs, estimates and opinions on the date the statements are made in light of management`s experience, current conditions and expected future development in the areas in which Wentworth is currently active and other factors management believes are appropriate in the circumstances. Wentworth undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless required by applicable law.

Readers are cautioned not to place undue reliance on forward-looking information. By their nature, forward-looking statements are subject to numerous assumptions, risks and uncertainties that contribute to the possibility that the predicted outcome will not occur, including some of which are beyond Wentworth`s control. These assumptions and risks include, but are not limited to: the risks associated with the oil and gas industry in general such as operational risks in exploration, development and production, delays or changes in plans with respect to exploration or development projects or capital expenditures, the imprecision of resource and reserve estimates, assumptions regarding the timing and costs relating to production and development as well as the availability and price of labour and equipment, volatility of and assumptions regarding commodity prices and exchange rates, marketing and transportation risks, environmental risks, competition, the ability to access sufficient capital from internal and external sources and changes in applicable law. Additionally, there are economic, political, social and other risks inherent in carrying on business in Tanzania and Mozambique. There can be no assurance that forward-looking statements will prove to be accurate as actual results and future events could vary or differ materially from those anticipated in such statements. See Wentworth`s Management`s Discussion and Analysis for the year ended December 31, 2014, available on Wentworth`s website, for further description of the risks and uncertainties associated with Wentworth`s business.

Notice

Neither the Oslo Stock Exchange nor the AIM Market of the London Stock Exchange has reviewed this press release and neither accepts responsibility for the adequacy or accuracy of this press release.

This information is subject of the disclosure requirements pursuant to section 5-12 of the Norwegian Securities Trading Act.

2014 Report on Corporate Governance
Annual 2014 MDA
Annual 2014 Financial Statements
2015 03 16 Press Release


This announcement is distributed by NASDAQ OMX Corporate Solutions on behalf of NASDAQ OMX Corporate Solutions clients.

The issuer of this announcement warrants that they are solely responsible for the content, accuracy and originality of the information contained therein.
Source: Wentworth Resources Limited via GlobeNewswire

HUG#1903591