Interim Results

White Nile Limited 30 March 2007 White Nile Ltd / Ticker: WNL / Index: AIM / Sector: Oil & Gas 30 March 2007 White Nile Ltd ('White Nile' or 'the Company') Interim Results White Nile Ltd, the AIM listed oil and gas exploration company, announces its results for six months ended 31 December 2006. Overview •Seismic interpretation highlights multiple targets •Four drilling locations prioritised for development •Drill rig on site near Padak in Block Ba in Southern Sudan •First well to spud in April 2007 Chairman's Statement It gives me great pleasure to report on the Company's progress towards fulfilling its objective of becoming a leading independent oil producer focused on Southern Sudan and the immediate region. During the period under review we have made great progress at our flagship project, the 67,000 sq km Block Ba in Southern Sudan. Having implemented and interpreted an extensive seismic programme, we have identified numerous drill targets and our first drill rig is on site and due to spud in April 2007. Southern Sudan In the last 18 months, White Nile has worked with leading oil industry consultants and operatives and conducted an extensive seismic acquisition programme on parts of Block Ba, in order to advance the block to production. Following the interpretation of high-density 2D seismic, we have identified numerous drill targets and prioritised four where we believe the productive Muglad Basin extends into the concession area, including one large structure of over 50 sq km. The contracted drill rig has been imported from Europe and is now on-site ready for the first well to be spudded in April 2007. This occasion signifies an important milestone for White Nile and underlines the significant progress the Company is making. In addition to proving and developing the oil potential of Block Ba in Southern Sudan, White Nile is also focussed on building a significant community development programme to ensure the local communities benefit appropriately during the whole life of White Nile's operations. The Company has taken a proactive role in the education of local workers, the provision of general tools and equipment to the community, logistical support to Government of Southern Sudan ('GOSS') officials in the immediate area and the development of infrastructure. White Nile employed over 1,000 local Southern Sudanese people to help repair 20 km of man made dyke between Jalle and Maar. Furthermore, it has invested significant sums in a land mine clearance operation undertaken by The Development Initiative in the specific areas of seismic operation and on key roads and villages primarily in the Bor/Padak area. The Company has commissioned an Environmental and Social Impact Assessment ('ESIA') study, which determines the environmental, social, technical and economic aspects of developing the oil potential of the concession area. This includes the local infrastructure of the area, namely the construction of access roads, accommodation camps and eventually an oil refinery, processing plant and pipeline. The ESIA is being carried out by ESF Consultants, a Kenyan based independent environmental management consultancy. White Nile's position with regard to the exploration and development rights over Block Ba and the rival claim by the French oil company, Total E&P Soudan S.A ('Total'), remains the same. Following assurances from the GOSS that it had the right to issue exploration and development concessions on land in Southern Sudan, the Company signed an agreement over two years ago with the state-owned petroleum company, Nile Petroleum Corp ('NilePet'), for the exploration and development of Block Ba. In that transaction, NilePet received a 50% shareholding in White Nile in return for a 60% interest in Block Ba, with the remaining 40% interest being retained by NilePet. In recent weeks Total has mounted a public-relations attack on White Nile and has reaffirmed its suggestion that it has rights to develop Block Ba under the terms of an agreement with the government in Khartoum in 1980. However, the autonomous GOSS has transferred all the non producing oil concessions in Southern Sudan to its state-owned petroleum company, NilePet, which has the power to negotiate development agreements, such as that which exists with White Nile. In this context, NilePet has, in addition, entered into an agreement with Ascom a European oil production company, for the exploration and development of Block 5b, which is contiguous to Block Ba in Southern Sudan. Total has also brought into question whether White Nile has the ability to explore and subsequently develop an area with such high potential. The Company's structure lends itself to efficiency and good practice. It is able to choose from among the best in the world within their respective fields in seismic, demining, security, drilling and pipeline and refinery development, while taking into account the local environment and your board has no doubt over White Nile's ability to develop Block Ba. Within 18 months White Nile has conducted seismic acquisition on parts of Block Ba. The interpretation of this seismic data has yielded a number of prospects, three of which the Company intends to drill this year. Ethiopia The Joint Study with the Ethiopian Government's Petroleum Operations Division over the prospective East African Rift system in the southwest of the country is progressing well. On-going geological and geophysical work over this emerging exploration play has so far yielded positive results with detailed gravity surveys indicating prospective depths of sediments in the northern extension of the Turkana Rift system. Support for these results has been obtained from complementary magneto-telluric ('MT') soundings undertaken in early 2006. Follow-up MT work is expected to reinforce this interpretation. Preliminary geological studies utilising apatite fission track analyses has indicated two possible phases of rifting, which support White Nile's exploration play of superimposed Cretaceous and Tertiary rifts systems with a concomitant enhanced petroleum potential. In addition, the Joint Study Area is to benefit from a regional airborne gravity and magnetic survey that will also cover highly prospective areas of adjacent Kenya and South Sudan. These are expected to highlight new areas of prospectivity within the region. Results White Nile remains focussed on the development of its oil concessions in Southern Sudan. The Company is still in the exploration stage and therefore is not producing revenue. In line with expectations, the Company is reporting a pre-tax loss of £699,200 (2006: loss of £515,434). Conclusion The past six months have seen many positive developments for White Nile. With our committed Board and management team, continued support from the GOSS, local authorities and people, and with the infrastructure and resources in place, we believe that White Nile will become a leading oil producing company in Southern Sudan and the immediate area. We have strong connections with many industry specialists in seismic, de-mining, security, drilling, environmental consultancy and pipeline and refinery development to bring Block Ba eventually into oil production, whilst taking into account the local environment, people and development of Southern Sudan. With the spudding of our first drill target scheduled for April, we have reached the next phase in our development. We are looking forward to the next six months and the exciting developments that we believe will come from the 2007 drilling development programme. White Nile's structure enables the owners of the resource, in this case the GOSS and the People of Southern Sudan, not only significant control but also, through their shareholding in White Nile, access to world capital markets and the ability to bring in technical expertise to develop Block Ba. Finally, I would like to take this opportunity to thank most particularly the people and the Government of Southern Sudan and the local communities, the real owners of the resources of Block Ba, for their help, cooperation and support. I would also like to thank the management team, shareholders and all those involved in the Company who have supported and believed in White Nile's cause, and helped the Company to reach the position it is in today. Phil Edmonds Chairman UNAUDITED PROFIT AND LOSS ACCOUNT FOR THE SIX MONTHS ENDED 31 DECEMBER 2006 Six months Six months Year ended ended 31 Dec ended 31 Dec 30 June 2006 2005 2006 £ £ £ TURNOVER - - - Net operating expenses ( 795,952) ( 775,110) ( 1,852,380) ------------ ------------ ------------ OPERATING (LOSS) ( 795,952) ( 775,110) ( 1,852,380) Interest receivable 100,587 259,676 439,372 Interest payable ( 3,835) - ( 4,569) ------------ ------------ ------------ (LOSS) ON ORDINARY ( 699,200) ( 515,434) ( 1,417,577) ACTIVITIES BEFORE TAXATION Taxation - - - ------------ ------------ ------------ (LOSS) ON ORDINARY ACTIVITIES AFTER TAXATION ( 699,200) ( 515,434) ( 1,417,577) ============ ============ ============ (LOSS) PER SHARE Basic and diluted (.219p) (.163p) (.447p) UNAUDITED BALANCE SHEET AT 31 DECEMBER 2006 31 December 31 December 30 June 2006 2005 2006 £ £ £ FIXED ASSETS Intangible assets 20,453,538 13,636,597 16,855,039 Tangible assets 728,479 40,072 227,907 ---------- ---------- ---------- 21,182,017 13,676,669 17,082,946 ---------- ---------- ---------- CURRENT ASSETS Debtors 2,331,426 410,020 340,137 Cash at bank and in hand 10,925,879 9,467,927 6,049,114 ---------- ---------- ---------- 13,257,305 9,877,947 6,389,251 Creditors: Amounts falling due within one year ( 1,064,503) ( 70,604) ( 974,728) ---------- ---------- ---------- NET CURRENT ASSETS 12,192,802 9,807,343 5,414,523 ---------- ---------- ---------- NET ASSETS 33,374,819 23,484,012 22,497,469 ========== ========== ========== CAPITAL AND RESERVES Called up share capital 329,000 317,000 317,000 Share premium account 35,556,635 24,076,485 23,992,085 Profit and loss account ( 2,510,816) ( 909,473) ( 1,811,616) ---------- ---------- ---------- EQUITY SHAREHOLDERS' FUNDS 33,374,819 23,484,012 22,497,469 ========== ========== ========== UNAUDITED CASH FLOW STATEMENT FOR THE SIX MONTHS ENDED 31 DECEMBER 2006 Six months Six months Year ended Ended Dec ended 31 Dec 30 June 2006 2005 2006 £ £ £ Cash outflow from operating activities ( 666,663) ( 1,965,650) ( 2,052,571) Returns on investment and servicing of finance 96,752 259,676 434,803 Capital expenditure and financial investment ( 4,129,874) ( 3,611,608) ( 7,034,227) ---------- ---------- ---------- CASH OUTFLOW BEFORE USE OF LIQUID RESOURCES AND FINANCING ( 4,699,785) ( 5,317,582) ( 8,651,995) Management of liquid resources ( 5,000,000) 5,489,316 10,525,153 Financing 9,576,550 ( 5,450) ( 89,850) ---------- ---------- ---------- (DECREASE)/INC REASE IN CASH IN THE PERIOD ( 123,235) 166,284 1,783,308 ========== ========== ========== RECONCILIATION OF NET CASH FLOW TO MOVEMENT IN NET FUNDS Six months Six months Year ended ended 31 Dec ended Dec 30 June 2006 2005 2006 £ £ £ (Decrease)/Inc rease in cash in the period ( 123,235) 166,284 1,783,308 Cash outflow/(inflow) from increase/(decr ease) in liquid resources 5,000,000 ( 5,489,316) ( 10,525,153) ---------- ---------- ---------- MOVEMENT IN NET FUNDS IN THE PERIOD 4,876,765 ( 5,323,032) ( 8,741,845) NET FUNDS AT BEGINNING OF PERIOD 6,049,114 14,790,959 14,790,959 ---------- ---------- ---------- NET FUNDS AT END OF PERIOD 10,925,879 9,467,927 6,049,114 ========== ========== ========== Notes 1. These interim financial statements do not constitute statutory accounts of the company within the meaning of Section 240 of the Companies Act 1985 and should be read in conjunction with the Annual Report for 2006. Statutory Accounts for the year ended 30th June 2006, which were prepared under accounting practices generally accepted in the UK, have been reported on by the auditors. The report of the auditors was unqualified and did not contain statements under section 237(2) or (3) of the Companies Act 1985. 2. (LOSS) PER ORDINARY SHARE Basic and diluted loss per share is calculated by reference to the (loss) for the financial period and the weighted average number of shares in issue in the period of 318,704,918 (six months to 31 December 2005: 316,885,870, year ended 30 June 2006: 316,942,466). * * E N D S * * For further information please visit or contact: Phil Edmonds White Nile Ltd Tel: 0845 108 6060 Jonathan Wright Seymour Pierce Ltd Tel: 020 7107 8000 Hugo de Salis St Brides Media & Finance Ltd Tel: 020 7242 4477 This information is provided by RNS The company news service from the London Stock Exchange