Lansdowne Oil & Gas - 2024 Annual Report & Accounts and General Meeting

NOTES TO THE GROUP FINANCIAL STATEMENTS

 

FOR THE YEAR ENDED 31 DECEMBER 2024

 

 

1       Accounting policies

 

Company information

Lansdowne Oil and Gas Plc is a public limited company incorporated,domiciled and registered in England and Wales. The registered office is C/O Pinsent Masons Llp, 30 Crown Place, London, EC2A 4ES. The company's principal activities and nature of its operations are disclosed in the directors' report.

 

The group consists of Lansdowne Oil and Gas Plc and all of its subsidiaries.

 

The Company's shares are quoted on the AIM Market of the London Stock Exchange.

 

1.1    Accounting convention

The financial statements have been prepared in accordance with UK International Accounting Standards (UK IASs) and with those parts of the Companies Act 2006 applicable to companies reporting under IFRS, except as otherwise stated. A summary of the more important accounting policies, which have been applied consistently, are set out below.

 

The financial statements are prepared in sterling, which is the functional currency of the group. Monetary amounts in these financial statements are rounded to the nearest thousands.

 

The financial statements have been prepared under the historical cost convention, except as otherwise stated. The principal accounting policies adopted are set out below.

 

1.2    Basis of consolidation

The consolidated financial statements include the results of Lansdowne Oil & Gas plc and its subsidiary undertakings, made up to 31 December each year. No separate income statement is presented for the parent company, as permitted by Section 408 of the Companies Act 2006.

 

The subsidiaries are those companies controlled, directly or indirectly, by Lansdowne Oil & Gas plc. The Group controls an entity when it is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. This control is normally evidenced when Lansdowne Oil & Gas plc owns, either directly or indirectly, more than 50 per cent of the voting rights or potential voting rights of a company's share capital. Companies acquired during the year are consolidated from the date on which control is transferred to the Group, and subsidiaries to be divested are included up to the date on which control passes from the Group. Inter-company balances, transactions and resulting unrealised income are eliminated in full.

 

Joint arrangements

The Group participates in a number of joint arrangements where control of the arrangement is shared with one or more other parties. A joint arrangement is classified as a joint operation or as a joint venture, depending on the rights and obligations of the parties to the arrangement.

 

The classification can have a material impact on the consolidated financial statements. The Group's share of assets, liabilities, revenue, expenses and cash flows of joint operations are included in the consolidated financial statements on a line-by-line basis, whereas the Group's investment and share of results of joint ventures are shown within single line items in the consolidated statement of financial position and consolidated income statement respectively.    

 

1.3    Going concern

The Directors have carried out a detailed assessment of the Group's current and prospective activities, its relationship with the holder of its loan note, and have prepared cash flow projections for the period up to 31 December 2026. The following represent the key assumptions underpinning the cash flow projections. The Company is pursuing two value creating opportunities:

 

Barryroe Oil and Gas field - Compensation claim

As has been explained, following the refusal of the Irish Minister at the Department of the Environment, Climate and Communications to award a Lease Undertaking for the Barryroe oil and gas field, Lansdowne is pursuing compensation via the Energy Charter Treaty.

 

The results of the Competent Person Report carried out by RPS ("RPS CPR") announced in February 2022, addressing simply the first phase of a Barryroe development and solely the Basal Wealden Oil reservoir, concluded that the P50 volumes were estimated at 81.2 million barrels of oil recoverable gross (16.24 million barrels net to Lansdowne) from a Best Estimate of 278 million barrels of oil in place (STOIIP).

 

An economic evaluation, documented in the RPS CPR, covering the Phase 1 development and in the 2C oil resources case, delivers an NPV10% for Lansdowne's 20% share of $104 million (£77.6 million at current exchange rate) under a Brent Oil Price assumption of US$68 per barrel in 2027, rising to $70/bbl in 2028 and 2029 and inflated at 2% per annum thereafter. The price of Brent Oil stands currently at c. $65/bbl, broadly in line with that modelled.

 

The RPS CPR has only addressed the oil in the Basal Wealden A Sand, which allows it to be correlated to the earlier work carried out by Netherland Sewell and Associates Inc.

 

Gas was proven in the Basal Wealden C Sand reservoir in the 48/24-10z well that overlays the oil reservoir and this has previously been estimated to hold a potential gas resource of c 400 BCF GIIP. Lansdowne believes this significant gas resource could make a vitally important contribution to Ireland's energy mix as it transitions to a zero net carbon economy and it is anticipated that any future phased development programme will include consideration of this important gas resource.

 

Given the above, the quantum of the Company's claim is well in excess of $100 million (£75 million).

 

The Company has appointed legal advisers to proceed with this claim, and it is likely that the matter will be brought before an international court of arbitration.

 

The Directors believe that the outcome of the legal proceedings is likely to be favourable, based on legal advice received and the merits of the Company's claim.

 

The Company's legal advisers are in dialogue with potential third-party litigation funders, who are being sought to provide the bulk of the necessary legal costs. These discussions are at an advanced stage, but there can be no guarantee that an agreement will be reached.

 

Reverse Take Over

One of the critical path items for progressing the Reverse Take Over is for the Company to complete the audit of its 2023 and 2024 Annual Accounts.

 

The 2023 Accounts were signed off on 11 June 2025 and the 2024 Accounts are presented here.

 

All the other documents to compete the Reverse Take Over are at an advanced stage.

 

A fund-raising is planned to accompany the completion of the Reverse Take Over and the process of re-admission of the Company's shares to trading on AIM and this is expected to take place in the third quarter of 2025.

 

The ability of the Group and the Company to continue as a going concern, therefore relies upon successful future equity fund-raising and continued support from the holder of the Company's loan note.

 

Additional funds of £180,000 have been raised in late 2024 and in 2025 through Convertible Loan Notes to support the company whilst pursuing the above opportunities and the Company's broker, Tavira Securities, is in the process of putting in place additional Convertible Loan Notes.

 

The Directors have considered the matters set out above and have concluded that a material uncertainty exists that may cast doubt on the ability of the Group and Company to continue as a going concern.

 

Nevertheless, after making enquiries and considering the uncertainties described above, The Directors consider it appropriate to prepare the financial statements on a going concern basis. These financial statements do not include any adjustment that would result from the going concern basis of preparation being inappropriate.

 

1.4    Intangible assets other than goodwill

 

Oil and gas intangible exploration/appraisal assets and property, plant & equipment - development/ producing assets

All expenditure relating to oil and gas activities is capitalised in accordance with the "successful efforts" method of accounting, as described in IFRS 6. The Group's policy for oil and gas assets is also compliant with IFRS 6 "Exploration for and Evaluation of Mineral Resources". Under this standard, the Group's exploration and appraisal activities are capitalised as intangible assets and its development and production activities are capitalised within "Property, plant and equipment".

 

All costs incurred prior to the acquisition of licences are expensed immediately to the income statement.

 

Licence acquisition costs, geological and geophysical costs and the direct costs of exploration and appraisal are initially capitalised as intangible assets, pending determination of the existence of commercial reserves in the licence area. Such costs are classified as intangible assets based on the nature of the underlying asset, which does not yet have any proven physical substance. Exploration and appraisal costs are held, un-depleted, until such a time as the exploration phase on the licence area is complete or commercial reserves have been discovered. If commercial reserves are determined to exist and the technical feasibility of extraction demonstrated, then the related capitalised exploration/appraisal costs are first subjected to an impairment test (see below) and the resulting carrying value is transferred to the development and producing assets category within property, plant and equipment. If no commercial reserves exist, then that particular exploration/appraisal effort was "unsuccessful" and the costs are written off to the income statement in the period in which the evaluation is made. The success or failure of each exploration/appraisal effort is judged on a field by field basis.

 

All costs incurred after the technical feasibility and commercial viability of producing hydrocarbons has been demonstrated are capitalised within development/producing assets on a field by field basis. Development expenditure comprises all costs incurred in bringing a field to commercial production, including financing costs. Subsequent expenditure is capitalised only where it either enhances the economic benefits of the development/producing asset or replaces part of the existing development/producing asset.

 

Net proceeds from any disposal of an exploration asset are initially credited against the previously capitalised costs. Any surplus proceeds are credited to the income statement. Net proceeds from any disposal of exploration assets are credited against the previously capitalised cost. A gain or loss on disposal of an exploration asset is recognised in the income statement to the extent that the net proceeds exceed or are less than the appropriate portion of the net capitalised costs of the asset.

 

Upon commencement of production, capitalised costs will be amortised on a unit of production basis which is calculated to write off the expected cost of each asset over its life in line with the depletion of proved and probable reserves.

 

Assets that are subject to amortisation are reviewed 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 net realisable value less costs to sell and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows. These cash-generating units ("CGUs") are aligned to the business unit and sub-business unit structure the Group uses to manage its business. Cash flows are discounted in determining the value in use.

 

1.5    Non-current investments

Interests in subsidiaries, associates and jointly controlled entities are initially measured at cost and subsequently measured at cost less any accumulated impairment losses. The investments are assessed for impairment at each reporting date and any impairment losses or reversals of impairment losses are recognised immediately in profit or loss.

 

A subsidiary is an entity controlled by the parent company. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.

 

An associate is an entity, being neither a subsidiary nor a joint venture, in which the group holds a long-term interest and has significant influence. The group considers that it has significant influence where it has the power to participate in the financial and operating decisions of the associate.

 

Entities in which the group has a long term interest and shares control under a contractual arrangement are classified as jointly controlled entities.

 

Shares in Group undertakings are held at cost less impairment provisions. Impairments occur where the recoverable value of the investment is less than its carrying value. The recoverable value of the investment is the higher of its fair value less costs to sell and value in use. Value in use is based on the discounted future net cash flows of the investee.

 

1.6    Cash and cash equivalents

Cash and cash equivalents include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

 

1.7    Financial Instruments

Non-derivative financial instruments comprise trade and other receivables, cash and cash equivalents, loans and borrowings, and trade and other payables. Interest- bearing borrowings are recognised initially at fair value less attributable transaction costs. Subsequent to initial recognition, interest-bearing borrowings are stated at amortised cost using the effective interest method.

 

1.8    Financial assets

Financial assets are recognised in the group's statement of financial position when the group becomes party to the contractual provisions of the instrument. Financial assets are classified into specified categories, depending on the nature and purpose of the financial assets.

 

At initial recognition, financial assets classified as fair value through profit and loss are measured at fair value and any transaction costs are recognised in profit or loss. Financial assets not classified as fair value through profit and loss are initially measured at fair value plus transaction costs.

 

Financial assets held at amortised cost

Financial instruments are classified as financial assets measured at amortised cost where the objective is to hold these assets in order to collect contractual cash flows, and the contractual cash flows are solely payments of principal and interest. They arise principally from the provision of goods and services to customers (eg trade receivables). They are initially recognised at fair value plus transaction costs directly attributable to their acquisition or issue, and are subsequently carried at amortised cost using the effective interest rate method, less provision for impairment where necessary.

 

Impairment of financial assets

Financial assets carried at amortised cost and FVOCI are assessed for indicators of impairment at each reporting end date.

 

The expected credit losses associated with these assets are estimated on a forward-looking basis. A broad range of information is considered when assessing credit risk and measuring expected credit losses, including past events, current conditions, and reasonable and supportable forecasts that affect the expected collectability of the future cash flows of the instrument.

 

Derecognition of financial assets

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire, or when it transfers the financial asset and substantially all the risks and rewards of ownership to another entity.

 

1.9    Financial liabilities

The group recognises financial debt when the group becomes a party to the contractual provisions of the instruments. Financial liabilities are classified as either 'financial liabilities at fair value through profit or loss' or 'other financial liabilities'.

 

Other financial liabilities

Other financial liabilities, including borrowings, trade payables and other short-term monetary liabilities, are initially measured at fair value net of transaction costs directly attributable to the issuance of the financial liability. They are subsequently measured at amortised cost using the effective interest method. For the purposes of each financial liability, interest expense includes initial transaction costs and any premium payable on redemption, as well as any interest or coupon payable while the liability is outstanding.

 

Derecognition of financial liabilities

Financial liabilities are derecognised when, and only when, the group's obligations are discharged, cancelled, or they expire.

 

1.10  Equity instruments

Equity instruments issued by the parent company are recorded at the proceeds received, net of direct issue costs,allocated between share capital and share premium. Dividends payable on equity instruments are recognised as liabilities once they are no longer payable at the discretion of the company.

 

Convertible Loan Note

 

Initial Recognition

The convertible loan note is initially recognised by separating it into the host contract and the embedded derivative. The embedded derivative is measured at fair value at initial recognition. The value of the host contract is determined as the difference between the proceeds received (net of transaction costs directly attributable to the issuance of the instrument) and the fair value of the embedded derivative.

 

Subsequent Measurement

• Equity Component (Host Contract):

After initial recognition, the equity component of the convertible loan is measured at the residual amount of the transaction price less the fair value of the conversion feature. The host contract is not remeasured at subsequent reporting dates.

 

• Embedded Derivative Liability:

The embedded derivative is measured at fair value using a Monte Carlo-based option pricing model. Changes in fair value are recognised immediately in profit or loss, and the derivative is remeasured at each reporting date.

 

Conversion

• Equity Component (Host Contract):

Upon conversion, the carrying amount of the equity component is transferred to share capital and share premium, as applicable.

 

• Embedded Derivative Liability:

The fair value of the embedded derivative at the date of conversion is transferred to equity, assuming the shares are issued. Any difference between the carrying amount of the derivative and the fair value of the shares issued (number of shares × share price at the conversion date) is recognised in profit or loss.

 

1.11  Taxation

 

Current Tax

 

Current tax assets and liabilities are measured at the amount expected to be recovered from or paid to the taxation authorities, based on tax rates and laws that are enacted or substantively enacted by the reporting date.

 

Deferred tax

Deferred tax is recognised on all temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements, with the following exceptions:

 

· In respect of taxable temporary differences associated with investments in subsidiaries, where the timing of the reversal of the temporary differences can be controlled and it is probable that the temporary differences will

 

· Deferred tax assets are recognised only to the extent that it is probable that taxable profit will be available against which the deductible temporary differences, carried forward tax credits or tax losses can be utilised.

 

Deferred tax assets and liabilities are measured on an undiscounted basis at the tax rates that are expected to apply when the related asset is realised or liability is settled, based on tax rates or laws enacted or substantively enacted at the reporting date.

 

The carrying amount of deferred tax assets is reviewed at each reporting date. Deferred tax assets and liabilities are offset only if certain criteria are met.

 

Income tax is charged or credited to other comprehensive income if it relates to items that are charged or credited to other comprehensive income. Similarly, income tax is charged or credited directly to equity if it relates to items that are credited or charged directly to equity. Otherwise income tax is recognised in the income statement.

 

1.12 Provisions

Provision is made for the cost of decommissioning oil and gas wells and other oil field facilities. The cost of decommissioning is determined through discounting the amounts expected to be payable to their present value at the date the provision is recorded and this calculation is re-assessed at each reporting date. This amount is included within development and production assets by licence area and the liability is included in provisions. The cost will be depleted over the life of the licence area on a unit of production basis and charged to the Income Statement. The unwinding of the discount is reflected as a finance cost in the income statement over the expected remaining life of the well.

 

1.13 Foreign Currency

The Group's consolidated financial statements are presented in Sterling, which is also the Company's functional currency. The assessment of functional currency has been based on the currency of the economic environment in which the Group operates and in which its costs arise. These financial statements have been presented in Sterling.

 

Monetary assets and liabilities denominated in foreign currencies are translated into the functional currency at the rate of exchange ruling at the reporting date. Transactions in foreign currencies are recorded at the rate ruling at the date of the transaction. All exchange gains and losses are taken to the income statement.

 

1.14 Warrants

The Group classifies instruments issued as financial liabilities or equity instruments in accordance with the substance of the contractual terms of the instruments. The warrants issued (as outlined in note 28) are derivative in nature and are classified as equity.

 

1.15 Operating segments

The Chief Executive monitors the operating results of its operating segment for the purposes of making decisions and performance assessment. Segment performance is evaluated based on operating profit or loss and is reviewed consistently with operating profit or loss in the consolidated financial statements. Because the Group does not engage yet in business activities from which it may earn revenue, and as all its developmental activities are currently located in one geographical area, no reportable segment has been identified nor disclosed in these financial statements.

 

1.16 Finance income and expenses

Interest income and interest payable is recognised in the income statement as it accrues, using the effective interest method. Finance expenses comprise interest on leased assets, unwinding of any discount on provisions, fair value movement of warrants, and foreign exchange movements in the retranslation of non-sterling denominated liabilities.

 

 

2      Adoption of new and revised standards and changes in accounting policies

 

The financial statements have been prepared in accordance with UK adopted International Financial Reporting Standards (IFRSs) and their interpretations issued by the International Accounting Standards Board ("IASB").

 

The IFRSs applied by the company in the preparation of these financial statements are those that were effective on or before 31 December 2024.

 

The following standards, amendments and interpretations which became effective from 1 January 2024 are of relevance to the company:

 

· Classification of Liabilities as Current or Non-Current (Amendments to IAS 1)

 

Standards, amendments and interpretations to existing standards that are not yet effective and have not been adopted early by the company:

 

· Lack of Exchangeability - Amendments to IAS 21(The Effects of Changes in Foreign Exchange Rates)

 

The effective date for all the above being 1 January 2025.

 

In the year ended 31 December 2024, the Group and Company did not early adopt any new or amended standards and do not plan to early adopt any of the standards issued but not yet effective.

 

There would not have been a material impact on the financial statements if these standards had been applied in the current year.

 

3       Critical accounting estimates and judgements

 

In the application of the company's accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

 

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised, if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.

 

The estimates and assumptions which have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities are outlined below.

 

Critical judgements

Going concern (policy (1.3) above)

 

Addition to critical accounting estimates and judgments note 3

 

Judgement Applied in Classification of Derivative as Equity or Liability

The Group issues convertible loans (CLNs) with embedded derivative features, which necessitates significant judgement in determining the classification of the derivative as either equity or a financial liability. This judgement considers the contractual terms of the conversion option, assessing whether the derivative meets the criteria for classification as equity. Where classified as a derivative financial liability (DFL), it is held at fair value through profit or loss (FVTPL), whereas derivatives classified as equity are not remeasured after initial recognition.

 

Estimation Applied in Valuation of Derivative Financial Liability

For CLNs classified as containing a DFL held at FVTPL, the Group uses a Monte Carlo simulation model to estimate the fair value of the DFL on initial recognition, at each reporting date, and upon conversion events. This approach is deemed appropriate due to the simulation's ability to model a range of possible outcomes, capturing the inherent variability in conversion terms and share price volatility. Key inputs in the Monte Carlo model include the Company's share price, share price volatility, the risk-free interest rate, and assumptions regarding the timing and probability of conversion.

 

Changes in any of these assumptions may significantly impact the fair value of the derivative liability, potentially resulting in profit or loss variations. Management regularly reassesses these inputs, utilising historical data and market-based assumptions to ensure that the fair value estimation reflects the economic substance of the convertible instrument.

 

Key sources of estimation uncertainty

 

Deferred tax asset

Deferred tax assets have not been recognised because it is not probable that future taxable profits will be available against which the Group can use the benefits therefrom.

 

Further details of the assumptions used can be found in this statement of accounting policies and in the notes to these financial statements

 

4       Revenue

The Group has one reportable operating and geographic segment, which is the exploration for oil and gas reserves in Ireland. All operations are classified as continuing and currently no revenue is generated from the operating segment.

 

5       Operating Loss

	2024	2023
	£'000	£'000
Operating loss for the year is stated after charging/(crediting):
Exchange Losses	-	2
Legal and professional fees	132	224
Accountancy	23	68
Timewriting Charge	-	(56)

 

6       Auditor's remuneration

 

	2024	2023
	£'000	£'000
Fees payable to the group's auditor and associates:
For audit services Audit of the financial statements of the group and company	25	25

 

7       Employees - Group and Company

 

The average monthly number of persons (including directors) employed by the group during the year was:

 

	2024	2023
	Number	Number
Employees	1	1
Their aggregate remuneration comprised:
	2024	2023
	£'000	£'000
Wages and salaries
Social Security Costs
Total	66	62

 

 

 

8       Directors' remuneration

	2024	2023
	£'000	£'000
Remuneration for qualifying services	101	105

 

 

9       Finance costs

	2024	2023
	£'000	£'000
Interest on bank overdrafts and loans	52	54

 

10     Other gains

	2024	2023
	£'000	£'000
Gain on derivative liability (Note 29) Gain on reversal of decommissioning liability	10                 10	512 512

 

During 2023, Following the full impairment of the carrying value of intangible assets related to the Barryroe lease undertaking (Note 29), the associated decommissioning provision was deemed unsubstantiated and reversed to the comprehensive income statement.

 

11     Income tax expense

 

The charge for the year can be reconciled to the loss per the income statement as follows:

 

	2024	2023
	£'000	£'000
Loss before taxation   Expected tax credit based on groupwise effective corporation tax rate of 25.00% (2023: 23.50%)   Effect of expenses not deductible in determining taxable profit   Income not taxable Unutilised tax losses carried forward Taxation charge for the year	336                  (84)         3     - 81   -	(16,343)   (3,841)           3,841     (119) 119   -

An unutilised tax loss of £1.81 million (parent entity) is being carried forward to subsequent tax year, arising from add back of non- trade relationship and management expense entries.

 

Deferred tax assets have not been recognised because it is uncertain that future taxable profits will be available against which the Group can use the benefits therefrom.

 

 

12    Loss per share

 

	2024 Number	2023 Number
Number of shares
Weighted average number of ordinary shares for basic earnings per share Effect of dilutive potential ordinary shares (note - will not apply for losses):	1,393,179,981	1,067,207,378
Weighted average number of ordinary shares for diluted earnings per share	1,393,179,981	1,067,207,378
	2024 £'000	2024 £'000
Loss Continuing operations
Loss for the period from continued operations	(336)	(16,343)
	2024 Pence per share	2023 Pence per share
Basic earnings per share	(0.02)	(1.53)
Diluted earnings per share	(0.02)	(1.53)

 

The calculation of the weighted average number of ordinary shares excludes Deferred Shares and Deferred A Shares, as these classes of shares do not carry voting or dividend rights.

 

13     Intangible assets

 

 

	Exploration/appraisal assets
Cost	£'000
At 1 January 2023	16,336
Additions	60
At 31 December 2023	16,396
Additions	-
At 31 December 2024	16,396
Amortisation and Impairment
Impairment loss	16,396
At 31 December 2023	16,396
At 31 December 2024	16,396
Carrying Amount
At 31 December 2024	-
At 31 December 2023	-

 

 

 

14	Subsidiaries

 

Details of the company's subsidiaries at 31 December 2024 are as follows:

 

	Name of undertaking	Registered office	Principal activities	Class of shares held	% Held Direct
	Lansdowne Celtic Sea Limited	England	Oil and gas exploration	Ordinary	100.00
	Milesian Oil & Gas Limited	Ireland	Oil and gas exploration	Ordinary	100.00
15	Joint operation

 

Details of the group's joint ventures at 31 December 2024 are as follows:

 

Name of undertaking	Principal activities	% Interest
Helvick Lease Undertaking	Hydrocarbon exploration	9

 

 

16	Trade and other receivables - Group   Amounts falling due within one year	2024 £'000		2023 £'000
	VAT recoverable	-		4
	Prepayments	-		1
		-		5

 

 

17     Trade and other receivables - Company	2024		2023
Amounts falling due within one year:	£'000		£'000
VAT recoverable	-		4
Prepayments	-		1
	-		5
18     Borrowings - Group	2024		2023
Borrowings held at amortised cost:	£'000		£'000
Loans from related parties	1,085		1,033
Loans from related parties above:	2024 £'000		2023 £'000
LC Capital loan balance at the beginning of the period	1,033		979
Loan interests	52		54
LC Capital loan balance at the end of the period	1,085		1,033

 

A senior secured loan note was issued in 2015 to LC Capital Master Fund Ltd ("LC"), a related party as outlined in Note 31. The loan is secured against assets held by Milesian Oil & Gas Limited, a subsidiary of the parent company operating in Ireland (Note 14). Currently, the coupon rate is 5% per annum. In December

2023, LC Capital Master Fund Ltd has agreed to extend the term of the loan to 30 June 2024. Following this, a further extension was approved after June 2024, and discussions regarding the loan repayment terms are still ongoing with company management and a renewed agreement has not been signed as of the date of signing the accounts.

 

 

 

19         Borrowings - Group

 

 

	2024	2023
	£'000	£'000
Borrowings held at amortised cost:
Loans from related parties	1,085	1,033

 

Borrowings of £1.03 million is related to the Shareholder loan granted by LC capital Master Fund Ltd (Note 18).

 

 

 

 

20         Capital commitments

 

              The Group has no unprovided contractual commitments for capital expenditure (2023: Nil)

 

 

21         Financial risk management

 

The Group's operations expose it to a variety of financial risks: market risk (including the effects of changes in foreign currency exchange rates, interest rates and commodity prices), credit risk and liquidity risk. The Board approves the use of financial products to manage the Group's exposure to fluctuations in foreign currency exchange rates and interest rates.

 

a)         Credit risk

Credit risk arises from cash and cash equivalents and deposits with banks. The Group's policy is to deposit cash with banks with an 'A' rating or better where possible. 100 per cent of cash held on deposit at 31 December 2024 was held with such banks.

 

Other than fully written down impairment of NIL (2023: £ 59,770 ) recognised in respect of receivables from its subsidiaries, the Company has no credit risk associated with its other receivables. See note 31.

 

There are no financial assets which are past due but not impaired at the end of the reporting period.

 

The maximum credit risk exposure relating to financial assets is represented by carrying values as at the reporting date.

 

The group does not hold any collateral or other credit enhancements to cover this credit risk.

 

b)         Liquidity risk management

The Board regularly reviews rolling cash flow forecasts for the Group and Company.

 

Financial and costs obligations related to the Group and Company's licences will be financed by either reducing its equity interest through new participants farming in, by the raising of new capital, through shareholder loans, or a combination of all three.

 

In December 2023, an extension was granted for the repayment of the LC Capital loan (Note 18), with a new due date of 30 June 2024. Following this, a further extension was approved after June 2024, and discussions regarding the loan repayment terms are still ongoing with company management and a renewed agreement has not been signed as of the date of signing the accounts.

 

Based on current forecasts, the Group and Company will need to raise further capital to meet its future obligations. This is reliant upon the assumptions outlined in the Statement of Accounting Policies.

 

There is no difference between the carrying value and the contractually undiscounted cash flows for financial liabilities. At 31 December 2024, all trade and other payables and shareholder loans were due within one year.

 

c)         Market risk management

 

Foreign exchange risk

Although the Group reports in Sterling, certain transactions are conducted in Euro. Given the low level of business conducted in Euro during the year, foreign exchange rate fluctuations had an immaterial effect on the result for the year.

 

Interest rate risk

The Group's interest rate risk arises from cash deposits and interest bearing liabilities.

 

Given the low level of average cash balances held by the Group during the year, a 10 per cent increase or decrease in average interest rates would have had an immaterial effect on the loss for the year and impact to interest bearing liabilities.

 

d)         Capital risk management

The group is not subject to any externally imposed capital requirements. The Group defines capital as equity plus shareholder loans.

 

The Group's objective when managing capital is to safeguard its ability to continue as a going concern in order to provide returns for the shareholders and to maintain an optimal capital structure to reduce the cost of capital.

 

 

The Group regularly reviews its capital structure on the basis of its expected capital requirements in order to achieve the defined strategic objectives and manages its capital accordingly.

 

The Group is committed to fully complying with the terms of the loan agreement with LC Capital Master Fund Limited, in order to maintain good cash liquidity a strong relationship with the shareholder.

 

The Group's and Company's financial instruments comprise cash, other receivables and trade payables and shareholder loans due within one year and therefore, management believes that the carrying values of those financial instruments approximate fair value.

 

e)         Fair value of non-derivative financial assets and financial liabilities

 

The Group's and Company's financial instruments comprise cash, other receivables and trade payables and shareholder loans due within one year and therefore, management believes that the carrying values of those financial instruments approximate fair value.

 

 

22         Trade and other payables - Groups

 

		Current 2024               2023		Non-current 2024               2023
	Amounts falling due within one year:	£'000	as restated £'000	as restated £'000              £'000
	Trade payables	71	44	-                     -
	Accruals	74	55	-                     -
	Social security and other taxation Derivative financial liability	28 -	8 -	-                     - 27                     -
		173	107	27                     -

 

 

23	Trade and other payables - Company	Current			Non-current
	Amounts falling due within one year:	2024   £'000	2023 as restated £'000		2024               2023 as restated £'000              £'000
	Trade payables	71	44		-                     -
	Accruals	74	55		-                     -
	Social security and other taxation Derivative financial liability	28 -	8 -		-                     - 27                     -
		173	107		27                     -

 

 

 

24	Provisions

Consequent to the correspondence received from DECC on 19 May 2023, the Group no longer expects to be required to fund the abandonment costs of the Barryroe well . This provision was released in June 2023 (Note 13).

 

 

25	Share capital   Authorised share capital	2024 Number		2023 Number		2024        £'000		2023         £'000
	Ordinary Shares of 0.01p each	1,393,618,337		1,233,618,337		139		123
	Deferred Shares of 4.9p each	161,741,795		161,741,795		7,925		7,925
	Deferred A Shares of 0.09p each	1,233,618,337		1,233,618,337		1,111		1,111
		2,788,978,469		2,628,978,469		9,175		9,159
	Issued and fully paid Ordinary Shares of 0.01p each	1,393,618,337		1,233,618,337		139		123
	Deferred Shares of 4.9p each	161,741,795		161,741,795		7,925		7,925
	Deferred A Shares of 0.09p each	1,233,618,337		1,233,618,337		1,111		1,111
		2,788,978,469		2,628,978,469		9,175		9,159

 

 

 

Reconciliation of movements of ordinary shares during the year:
	Number
At 1 January 2024	1,233,618,337
Issue of fully paid shares	160,000,000
At 31 December 2024	1,393,618,337

 

 

In December 2023, the Company also placed a second tranche of 160,000,000 new ordinary shares of 0.1 pence each to raise £160,000, conditional on the passing of resolutions at a General Meeting of the Company's shareholders held on 29 December 2023. These resolutions were duly passed. The issuance and trading of the shares took place on 2 January 2024.

 

Both Deferred Shares (Sub-divided in 2016) and Deferred 'A' Shares (Sub-divided in 2023) have little economic value as they do not carry any rights to vote or dividend rights, although both Deferred Shares and the New Deferred 'A' Shares will rank pari passu with the New Ordinary Shares on a return of capital or on a winding up of the Company.

 

 

 

26	Share premium account	2024	2023
		£'000	as restated £'000
	At the beginning of the year (as restated)	31,787	31,606
	Issue of new shares	144	240
	Cost of share issue	(32)	(59)
	At the end of the year	31,899	31,787

 

 

 

 

27     Convertible loan reserve	2024		2023
	£'000		£'000
At the beginning of the year Arising in the year (Note 29)	- 45		- -
At the end of the year	45		-

 

 

 

28     Warrants reserve

 

The opening fair value of £115,000 relate to equity portion of the LC Capital Loan compound financial instrument valued at inception in December 2021 after issue of 26 million LC warrant instrument by the company.

 

During the year, the Company issued no additional warrants to shareholders. Warrants issued in the prior period were catagorised into either ' LC warrants', 'Investor warrants' or 'Broker warrants'

 

The warrants were classified and accounted for as equity.

 

The table below provides the summary of warrant movements and fair value during the year:

 

Group and Company	Number of	Fair Value
	Warrants	£'000
At 1 January 2024	117,529,826	115
LC warrants - lapse of warrants (Table A)	(41,529,826)	-
Investor warrants - issue of warrants (Table B)	-	-
Broker warrants - issue of warrants (Table C)	-	-
At 31 December 2024	76,000,000	115

 

The total charge to the statement of comprehensive income for the year ended 31 December 2024 was £NIL (2023: NIL).

 

LC Warrants - Table A

 

Date of Grant	Warrants Balance b/f	Warrants Issue/lapse	Warrants Balance c/f	Exercise Price	Expiry Date	Fair Value £'000
as at 1 Jan 2024			41,529,826	0.001p	30/06/2024		Note

 

30/06/2024	41,529,826     (41,529,826)	-                -                                         -         (a)
as at 31 Dec 2024	(41,529,826)	-

 

(a) In December 2023, as part of LC Capital's agreement to the Loan Extension, the Company has agreed to certain amendments to the LC Warrant Instrument.

 

The foregoing arrangements provide that:

• the exercise period for all of the warrants granted under the LC Warrant Instrument (including the LC Warrants) has been extended to now expire on 30 June 2024 , in line with the Loan Extension; and

 

• as a result of the Maturity Date being extended, the provisions of the LC Warrant Instrument, which provided for the warrants granted under the LC Warrant Instrument being adjusted in the event of the Company completing any equity fundraising(s) prior to 31 December 2023 will apply in respect of any Equity Fundraising completed prior to 30 June 2024.

 

Investor Warrants - Table B

 

Date of Grant	Warrants Balance b/f	Warrants Issue	Warrants Balance c/f	Exercise Price	Expiry Date	Fair Value £'000
as at 1 Jan 2024		60,000,000		0.001p	01/02/2025	Note
as at 31 Dec 2024		60,000,000				-         (b)

 

(a)  In connection with the Placing in January 2023, the Company also granted a total of 60,000,000 warrants ("Investor Warrants") to placees participating in the Placing, on a one Investor Warrant per Placing Share basis, to subscribe for new ordinary shares in the Company at a price of 1.0 pence per share. The Investor Warrants will be exercisable until the second anniversary of Admission.

 

Broker Warrants - Table C

 

Date of Grant	Warrants Balance b/f	Warrants Issue	Warrants Balance c/f	Exercise Price	Expiry Date	Fair Value £'000
as at 1 Jan 2024		16,000,000		0.001p	29/12/2026	Note
as at 31 Dec 2024		16,000,000				-         (c)

 

(b) In 2023, 16,000,000 warrants were granted to the broker Tavira Financial Limited, with an exercise price of 0.1p per ordinary share. The Broker Warrants will be exercisable up until the third anniversary of admission of the Conditional Placing Shares to trading on AIM.

 

Fair value calculation of warrants

The warrant transactions above in regard to 'LC warrants', 'Broker warrants' and 'Investors warrants' do not fall within the scope of IFRS 2, specifically within section 2.2.3.A, where such transaction would be in exchange for goods and services. The warrants are only held by shareholder as an incentive to invest in the company in the future. The accounting treatment is such case do not require the use of Black Scholes model to calculate the fair value as at grant date. As a result the fair value of warrant transactions above from (a) to (c) remains NIL as at 31 December 2024.

 

 

 

29         Convertible loan notes

 

As at 31 December 2024, the fair value of the DFL was as follows:

 

Group and Company	£'000
At 1 January 2024	-
Initial recognition	37
Fair value through income statement	10
At 31 December 2024	27

 

 

Equity Host Contract

The principal (host contract) was issued with the intention for it to be converted into equity upon completion of the RTO. Until that point, both parties intend for the CLNs to remain outstanding indefinitely. The parties do not intend for the principal to be repaid in cash, and therefore the principal is an equity host contract.

Initial recognition and measurement

The value of the host contract is determined as the difference between the proceeds received (net of transaction costs directly attributable to the issuance of the instrument) and the fair value of the embedded derivative.

 

The equity component is not remeasured and remains within equity unless the instrument is modified or converted.

 

As at 31 December 2024, the fair value of the equity host contract was as follows:

 

Group and Company	£'000
At 1 January 2024	-
Initial recognition	48
Allocated transaction costs	(3)
At 31 December 2024	45

 

30     Events after the reporting date

In February 2025 the Company announced the issuing of a further £45,000 of Convertible Loan Notes, arranged by Tavira Financial Limited, the Company's joint broker, to a number of existing shareholders.

 

The Loan terms are the same as those previously entered into and announced on 20 September 2024. The Loan is unsecured, carries no interest and shall be converted into new ordinary shares of 0.01 pence each in the Company ("New Ordinary Shares") at the time of completing a reverse takeover and subject to shareholder approval for the extension of share issuance authorities. The conversion price will be the lower of 0.1 pence (being the share price at the time of suspension on 21 March 2024), or a 20% discount price to the issue price at the time of any issuance of shares alongside a future reverse takeover. At the date of signing of these accounts, the reverse takeover is expected to take place in the third quarter of 2025.

 

On 30 July 2025, the Company announced the issued of a further £100,000 of Convertible Loan Notes, made under the same terms as the previous issues in September 2024 and February 2025.

 

Lansdowne used the funds to provide working capital whilst discussions continue with potential funders for Lansdowne's Energy Charter Treaty claim against Ireland and work progresses toward a potential reverse takeover.

 

Trading in the Company's shares on AIM remained suspended. Regarding the ECT claim, a large amount of information has been provided to a potential third-party litigation funder that has indicated interest in funding the claim. Again, this is expected to come to fruition in the third quarter 2025. There can however, be no guarantee that such funding will be forthcoming.

 

On 24 July 2025, a financial commitment of approximately £15,000 (USD $20,000) was made to a U.S.-based law firm to progress legal agreements with a prospective third-party litigation funder. The associated costs are being shared among the claimants, with the Company's portion amounting to the above commitment. While there is no certainty of a successful conclusion, the Company is encouraged by this development.

 

31     Related party transactions

 

Remuneration of key management personnel

 

	2024	2023
	£'000	£'000
Short-term employee benefits (Salaries)	101	105

 

 

 

 

Other transactions with related parties

Transactions with LC Capital Master Fund Ltd

The Company has a loan agreement with LC Capital Master Fund Limited, a major shareholder. Warrants were granted to LC Capital Targeted Opportunities Fund. Details of the loan agreement are given in Note 18.

 

Amounts due by subsidiaries

At 31 December 2024, amounts owed to the Company by its subsidiaries totalled £22 million (2023: £22 million). These amounts have been provided in full in the Company's financial statements as there is no immediate prospect of repayment. Amounts due to the Company are unsecured, non-interest bearing and have no fixed repayment terms.

 

32     Prior period adjustment

 

 

During the preparation of the 2024 statutory accounts, the Group management undertook a reconciliation of the share issue costs brought forward from prior year.

 

The reconciliation identified that the share premium in 2023 was overstated by £8k and trade creditors understated by the same amount as a result of the late receipt of invoices.

 

Management resolved to correct the opening share premium account against the prior year's share premium balance. This adjustment ensures that both the share premium and trade creditor balances are appropriately stated in the Company and Group accounts.