Great E. Energy Corp GEEC Half Yearly Report

  Great E. Energy Corp (GEEC) - Half Yearly Report

RNS Number : 6997P
Great Eastern Energy Corp Ltd
29 October 2012














29 October 2012

                   Great Eastern Energy Corporation Limited

                      ("Great Eastern" or "the Company")

                                      

                               Interim Results

                  For the six months ended 30 September 2012



Great Eastern Energy  Corporation Limited (LSE:  GEEC), the fully  integrated, 
leading Indian  Coal Bed  Methane (CBM)  company,is pleased  to announce  its 
Interim Results for the six months ended 30 September 2012.



Highlights



Financials:



· Total revenue  increased by 29%  to US$ 14.71m  (Six month period  year 
ended 30 September 2011:
US$ 11.42m)

· EBITDA  increased  by 48%  to  US$ 9.99m  (Six  month period  ended  30 
September 2011: US$ 6.77m)

· PAT [pre MTM*] increased by 165%  to US$ 5.73m (Six month period  ended 
30 September
 2011: [pre MTM*] of US$ 2.16m)

· PAT [after MTM*] US$ 4.03m  (Six month period ended 30 September  2011: 
loss [after MTM*] of US$
4.92m)

· On a  constant currency basis  total revenue has  increased 56% to  Rs. 
805m (Six month period
 ended 30 September 2011: Rs. 517m)

· The Company has a long term debt of US$ 94.94m as at 30 September 2012



* MTM  (Mark to  Market)  is on  account of  the  restatement of  the  foreign 
currency loans and derivatives



Upstream:



Raniganj (South) Block:



· Production increased to 12.5 mmscfd, up 40% from May 2012 and 50%  from 
November 2011

· A total of 132 wells drilled; including 33 deviated wells  successfully 
drilled

· Since November 2011  fracced 41 new wells  and 8 existing wells  (where 
previously less seams were
fracced)

· Total of 108 wells dewatering / producing gas, a 59% increase over  the 
previous year

· 11 deviated wells producing gas



Mannargudi Block:



· Environmental clearance received from Ministry of Environment and Forest

· Final  approvals  expected within  this  calendar year  from  the  State 
Government





Downstream:



· Great Eastern continues to supply  to its existing customer base  while 
adding further new industrial
customers

· 38.1mmscfd gas under contract / MOU, up 11% from November 2011

· The Company  has sufficient  contracts in  hand to  meet its  projected 
production targets

· Further discussions underway with major new industrial customers





Outlook



· Further production increase expected at Raniganj (South) Block



          Exit Production Range

                (mmscfd)
31 Dec 12      14.6 - 16.2
30 Jun 13      21.7 - 24.1



· Work to commence on Mannargudi Block once expected approvals received

· Work consists of 30 pilot production wells and 50 core holes

· 168  wells planned  to  be drilled  over the  next  five years  in  the 
Raniganj (South) Block

· Pricing environment remains stable





Prashant Modi, President and COO of Great Eastern, said:



"We have  continued  to make  excellent  progress in  the  period,  delivering 
significant  growth  in  production,  revenue  and  profits,  and  have  every 
confidence in meeting market expectations for the full year.



We will continue to drive  our production ramp-up in  2012, with a second  rig 
deployed at Raniganj (South) block and best in class technology being used  to 
execute fracturing on schedule. The  substantial reserves upgrade we made  in 
June 2012 reaffirms  once again the  recoverability of gas  from the  Raniganj 
(South) Block.



We have now received Environmental Clearance for the Mannargudi Block from the
Ministry of Environment and  Forest, and we are  in advanced discussions  with 
the Tamil Nadu Government to receive the required approval for the Consent  to 
Establish. We expect to commence work before the end of the year.



The supply/demand  balance  for gas  in  India  continues to  provide  a  very 
attractive opportunity, which is set to continue for many years to come. Based
as we are in the heart of  West Bengal's large and growing industrial  centre, 
with an outstanding  resource base and  the infrastructure fully  in place  to 
allow us to translate  production growth directly into  sales, we are  ideally 
positioned to take  advantage of this  demand and deliver  on our  significant 
growth potential."



A presentation for analysts  will be held at  9 am on 29  October 2012 at  the 
London Stock Exchange, 10 Paternoster Square, London, EC4M 7LS.





For further information please contact:



Great Eastern Energy
Yogendra Kr. Modi     Chairman & CEO  +44 (0)20 7337 1516
Prashant Modi  President & COO


Arden Partners plc
Richard Day                                           +44 (0)20 7614 5917


Goldman Sachs International
James Anderson                                        +44 (0) 20 7774 1000
M: Communications
Ann-marie Wilkinson                                   +44 (0) 20 7920 2330
Andrew Benbow





Chairman's Statement



Financials



In the first  six months of  FY 2012-13 Great  Eastern made material  progress 
across the business, delivering significant growth in production, revenue, and
profit.



The increase in revenue and profit was  as a result of the significant  uplift 
in gas production and corresponding sales. With existing gas sales  contracts 
and MOUs in  place, any  increase in  production is  immediately reflected  in 
enhanced revenue, which in turn falls through to growth in cash flow.



Total revenue  increased by  29%, compared  to the  corresponding period  last 
year, to  US$ 14.71m,  while  EBITDA increased  by 48%  to  US$ 9.99m.  On  a 
constant currency basis total revenue has increased 56% to Rs 805m.



At the PAT level, pre MTM (Mark to Market) the company has made a  significant 
profit of  US$ 5.73m  as  compared to  pre  MTM profit  of  US$ 2.16m  in  the 
corresponding period last year, an increase of 165%. MTM is on account of the
restatement of the foreign currency loans and derivatives.



The Company has a long term debt of  US$ 94.94m as at 30 September 2012,  with 
various leading  banks.  With  increasing cash  flows  being  generated,  the 
company has negotiated to arrange further debt facilities of Rs. 2.45  billion 
(approximately  US$  46m)   which  has   been  tied-up   and  the   consortium 
documentation is  in process.  The  company has  already  drawn US$  7m  after 
entering into interim documentation with two banks.



The supply and  demand dynamic for  Indian gas, and  the pricing  environment, 
remains extremely attractive  and is  likely to remain  so for  some years  to 
come.



Having seen the benefit of considerable investment in asset and infrastructure
development over the years, Great Eastern is now a significantly de-risked and
profitable business.  These results  confirm that  we are  at the  start of  a 
sustained period of visible and profitable growth as we ramp up production  to 
its full potential, as well as developing additional resources.



Reserves, Drilling & Production



In June  we  announced a  significant  increase  in our  reserve  numbers,  as 
provided by  independent  reserve engineers  Advance  Resources  International 
(ARI). There has been an increase  of 18% in Original-Gas-In-Place (OGIP)  to 
2.35 TCF from  2 TCF  and an  increase of 38%  in gross  Proven, Probable  and 
Possible reserves (3P)  from September 2011,  and 466% from  November 2009  at 
Raniganj (South) Block.



We continue to make progress in production ramp-up. A total of 132 wells have
now been drilled at  our world-class Raniganj (South)  Block, with a total  of 
108 wells dewatering and producing gas, a 59% increase over the  corresponding 
period of the last year.



Since November 2011 we have  fracced a further 41  wells and 8 existing  wells 
(where previously less seams were fracced)  which puts us on track to  achieve 
our ongoing target of fraccing 40 wells per year.



The commencement of drilling  deviated wells from a  single well site and  the 
drilling of  multiple  wells  from  the same  location  will  also  accelerate 
production, with increased time efficiency and faster completions. To date 33
deviated wells have been drilled.



Sales, Marketing, & Distribution



The Company has 38.1  mmscfd gas under  contract / MOU,  up 11% from  November 
2011. The pricing environment remains stable.



Great Eastern is well placed to be the supplier of choice for gas resources in
the  highly  industrialised  area  of  West  Bengal,  where  demand  is   both 
substantial and growing.  Our position  as supplier  of choice  to our  local 
customers is underpinned  by our  fully-functioning infrastructure,  including 
our pipeline which runs through the key industrial areas.



Mannargudi CBM Block



The Mannargudi Block covers an effective area of 667 sq. km. and is located in
the southern part of the country.



The Company signed a CBM contract for the Mannargudi block with the Government
of India on  29 July 2010,  and has signed  the Petroleum Exploration  License 
with the  Government of  Tamil  Nadu. The  Company has  received  Environment 
Clearance and expects to receive the Consent to Establish from the  Government 
of Tamil Nadu before the end of  2012. Work will start soon thereafter  which 
will consist of 30 pilot production wells and 50 core holes.



CSR



The Company  has added  value not  only in  economic terms,  but also  through 
improving the quality of life for people in the community from its operational
area and surroundings.



Great Eastern has contributed towards  improving the environment in this  area 
through substitution of polluting fuels with the use of clean energy. We also
sponsor a number of medical camps, blood donation camps, sporting  activities, 
and community health initiatives in the region.



Great Eastern views itself as  an integral part of  the community in which  it 
works, with the business designed to not only create value for the company but
also to make  a positive contribution  to the sustainable  development of  the 
local area.



I would like to thank our management team and all personnel for their  ongoing 
contribution to our continuing success.



Outlook



We are well  placed to  build on the  success of  the first six  months of  FY 
2012-13. We will continue to drive production growth in the Raniganj  (South) 
Block, and  project  execution will  be  facilitated  by the  second  rig  and 
best-of-breed fracturing technology.



We have the infrastructure in  place to meet the  needs of the multiple  large 
industrial  customers  in  the  region,  and  consequently  each  increase  in 
production feeds directly through to revenue.



We look forward to  commencing work at  the Mannargudi Block  on the basis  of 
receiving the expected approvals.



Looking further ahead  we have  an exciting  drilling schedule  with some  168 
wells planned to be drilled over the  next five years on the Raniganj  (South) 
block alone. We are  confident that our consistent  execution in growing  our 
production will continue to deliver value to our shareholders.

                                      

                                      

    Independent Auditors' Report on review of condensed interim financial
                                 information





To the Board of Directors of

Great Eastern Energy Corporation limited





Introduction

We have reviewed the accompanying condensed statement of financial position of
Great Eastern  Energy  Corporation  Limited  as  at  30  September  2012,  the 
condensed income statement, the  condensed statement of comprehensive  income, 
changes in equity and  cash flows for  the six months  period then ended,  and 
notes to the interim financial  information ("the condensed interim  financial 
information"). Management is responsible for the preparation and  presentation 
of these condensed  interim financial  information in accordance  with IAS  34 
Interim Financial Reporting. Our responsibility is to express a conclusion  on 
this condensed interim financial information based on our review.

Scope of review

We conducted  our review  in  accordance with  the International  Standard  on 
Review Engagement 2410  Review of Interim  Financial Information performed  by 
the  Independent  Auditor  of  the  Entity.  A  review  of  interim  financial 
information consists of making inquiries, primarily of persons responsible for
financial and accounting  matters, and  applying analytical  and other  review 
procedures. A review is substantially less in scope than an audit conducted in
accordance with International Standards on Auditing and consequently does  not 
enable us to obtain  assurance that we would  become aware of all  significant 
matters that might be identified in  an audit. Accordingly, we do not  express 
an audit opinion.

Conclusion

Based on our  review, nothing  has come  to our  attention that  causes us  to 
believe that the  accompanying condensed interim  financial information as  at 
and for the period ended 30 September  2012 are not prepared, in all  material 
respects, in accordance with IAS 34 Interim Financial Reporting.





KPMG

Date: 27 October 2012

Place: Gurgaon





                                      

                                     

                                      

                                      

                                      

                                      

                   Great Eastern Energy Corporation Limited

                    Condensed interim financial statements

                  For the six months ended 30 September 2012

                                      

                                      

                                      

                                      

                                      

                                      

                                      

                                      

                                      

                                      

                                      

                                      

                                      

Great Eastern
Energy
Corporation
Limited
Condensed
statement of
financial
position
(All amounts in
US dollars
unless otherwise
stated)
                                      As at
                 Notes                  30 September 2012                 31 March 2012
                                              (Unaudited)                     (Audited)
ASSETS
Non-current
assets
Property, plant    7           107,825,204   99,273,933
and equipment
Capital            8          71,928,930   67,657,015
work-in-progress
Intangible         9        323,755        
assets                                                                          361,411
Intangible under  10        280,418        
development                                                                     189,682
Available for            190 
sale-financial                                                                      195
assets
Prepayments                 513,773        
                                                                                148,799
Trade and other            76,219      
receivables                                                                      68,151
Other assets                257,707        
                                                                                319,177
Total                          181,206,196    168,018,363
non-current
assets
Current assets
Trade and other              1,821,819  1,764,440
receivables
Other current              91,256      
assets                                                                           70,549
Prepayments                73,368        
                                                                                284,913
Current tax                 355,047        
assets                                                                          345,490
Restricted                   3,750,593  4,302,704
deposits with
banks
Deposits with               584,311  1,521,160
banks
Cash and cash               343,688  1,514,854
equivalents
Total current                7,020,082  9,804,110
assets
Total assets                   188,226,278    177,822,473
Equity
Share capital                 13,306,007   13,306,007
Share premium                 91,006,858   91,006,858
Reserves                     (9,269,946)  (7,270,546)
Retained                      (18,789,565)   (22,824,341)
earnings
Total equity                  76,253,354   74,217,978
attributable to
owners of the
Company
Liabilities
Loans and         13          78,488,048   78,616,244
borrowings
Employee                    571,433        
benefits                                                                        671,356
Employee share    14        131,048        
based payment                                                                   146,286
liability
Derivative        20         4,454,339  3,410,694
liabilities
Provisions        16        195,360        
                                                                                185,013
Total                         83,840,228   83,029,593
non-current
liabilities
Loans and         13          16,461,414   10,523,792
borrowings
Trade and other               10,548,148  8,335,949
payables
Employee benefit            240,697      
liability                                                                        75,937
Employee share    14          
based payment                                           -                        27,333
liability
Other current               557,044        
liabilities                                                                     860,351
Derivative        20        325,393        
liabilities                                                                     751,540
Total current                 28,132,696   20,574,902
liabilities
Total                          111,972,924    103,604,495
liabilities
Total equity and               188,226,278    177,822,473
liabilities



The accompanying notes form an integral part of the condensed interim
financial statements


On behalf of the Board of Directors
                                                     

Yogendra Kumar Modi                                  Kashi Nath Memani
Chairman & Chief Executive Officer                   Director
Place: Gurgaon
Date: 27 October 2012













Great Eastern Energy Corporation Limited
Condensed
income
statement
(All amounts in US dollars
unless otherwise stated)
                                      For the six months ended
                                            30 September
                 Notes                   2012                            2011
                                      (Unaudited)                    (Unaudited)
Revenue
- Sale of gas                           14,387,378                       
                                                                       10,833,419
- Other                              67,135                   
operating                                                                 273,068
revenue
Other income                        3,578                  
                                                                          239,796
                                          14,458,091                         
                                                                       11,346,283
Stores and                            (654,965)                    
consumables                                                             (599,453)
Employee                              (952,950)                       
benefit                                                               (1,124,327)
expenses
Depletion,                             (1,475,003)                       
depreciation and                                                      (1,399,440)
amortisation
Other operating                        (3,110,289)                       
expenses                                                              (3,051,661)
Results from                            8,264,884                      
operating                                                               5,171,402
activities
Finance income
-Interest and                          256,440                
other finance                                                              78,019
income
Finance
expenses
- Exchange                                               
fluctuation loss    (1,708,072)                         (7,074,995)
and change in    20

 fair value of
derivative
instruments
- Other                             (4,489,547)                       
finance             (2,781,475)                         (3,091,346)  (10,166,341)
expenses
Net finance                             (4,233,107)                          
costs                                                                (10,088,322)
Profit/(loss)                           4,031,777                        
before tax                                                            (4,916,920)
Income tax                                                 -
expense                                              -
Profit/(loss)                           4,031,777                        
for the period                                                        (4,916,920)
Earnings/(loss)
per share
Basic            21                 0.069                 
earnings/(loss)                                                           (0.085)
per share (USD)
Diluted                             0.069                 
earnings/(loss)                                                           (0.085)
per share (USD)





The accompanying notes form an integral part of the condensed interim
financial statements


On behalf of the Board of Directors
                                                     

Yogendra Kumar Modi                                  Kashi Nath Memani
Chairman & Chief Executive Officer                   Director
Place: Gurgaon

Date: 27 October 2012























Great Eastern Energy
Corporation Limited
Condensed statement of
comprehensive income
(All amounts in US dollars
unless otherwise stated)
                                        For the six months ended
                                              30 September
                                       2012                      2011
                                   (Unaudited)                (Unaudited)
Profit/(loss) for the                  4,031,777           (4,916,920)
period
Other comprehensive
income
Net change in fair value      -       (13,465)
of available-for-sale
financial assets
reclassified to profit
or loss
Foreign currency                       (2,012,120)          (6,009,081)
translation adjustment
Total other                            (2,012,120)           (6,022,546)
comprehensive income
Tax expense                    -    
                                                                             -
Total comprehensive income             2,019,657            (10,939,466)
for the period
Profit/(loss)
attributable to:
Owners of the Company                 4,031,777          (4,916,920)
Total comprehensive
income/(loss) attributable
to:
Owners of the Company                 2,019,657           (10,939,466)







The accompanying notes form an integral part of the condensed interim
financial statements


On behalf of the Board of Directors
                                                     

Yogendra Kumar Modi                                  Kashi Nath Memani
Chairman & Chief Executive Officer                   Director
Place: Gurgaon

Date: 27 October 2012









Great Eastern Energy Corporation
Limited
Condensed statement of changes in
equity
(All amounts in US dollars unless otherwise stated)
For the six months ended 30 September  Attributable to owners of the Company
2011 (Unaudited)
                     Share capital      Share premium*    Retained earnings        Foreign currency     Fair value        Share based  Total equity
                                                                                translation reserve        reserve    payment reserve
Balance as at l           13,021,808      78,502,121     (20,077,651)     1,270,285  13,465           341,156     73,071,184
April 2011
Total comprehensive income for the
period
Loss for the            (4,916,920)       (4,916,920)
period                            -                -                                        -            -                -
Other
comprehensive
income
Foreign currency           (6,009,081)      (6,009,081)
translation                       -                -                 -                                   -                -
adjustment
Net changes in
fair value of
available-for-sale
financial assets   
transferred to                                          
profit or loss                      -                -                 -                    -  (13,465)                -       (13,465)
Total other                 (6,009,081)    (13,465)     (6,022,546)
comprehensive                     -                -                 -                                                      -
income
Total                     (4,916,920)       (6,009,081)    (13,465)    (10,939,466)
comprehensive                     -                -                                                                          -
income for the
period
Transactions with owners, recorded directly in equity
Share-based                     57,884       
payment                           -                -                 -                    -            -                            57,884
transactions
Transfer to
share-based
payment liability
on account of      
modification                             
(refer to note 14)                  -                -                 -                    -            -          (226,145)   (226,145)
Options forfeited     16,548            (16,548)   -
during the period                 -                -                                        -            -
Balance as at 30          13,021,808        78,502,121       (24,978,023)       (4,738,796)      156,347 61,963,457
September 2011                                                                                                 -







 



Great Eastern Energy Corporation Limited
Condensed
statement of
changes in
equity
(All amounts in US dollars unless otherwise
stated)
For the six-months ended 30  Attributable to owners of the Company
September 2012 (Unaudited)
              Share capital     Share        Retained       Foreign currency     Fair value        Share based  Total equity
                              premium*       Earnings            translation        reserve    payment reserve
                                                                     reserve
Balance as at 13,306,007 91,006,858 (22,824,341) (7,433,942)    163,396     74,217,978
l April 2012                                                                            -
Total comprehensive income
for the period
Profit for              -           -       4,031,777                -      4,031,777
the period                                                                              -                -
Other
comprehensive
income
Foreign                 -           -             -       (2,012,120)     (2,012,120)
currency                                                                                -                -
translation
adjustment
Total other             -           -             -       (2,012,120)      (2,012,120)
comprehensive                                                                           -                -
income
Total                   -           -   4,031,777       (2,012,120)       2,019,657
comprehensive                                                                           -                -
income for
the period
Transactions with owners, recorded
directly in equity
Share-based             -           -             -                -   15,719       
payment                                                                                 -                            15,719
transactions
Options                 -           -           2,277                -          
forfeited                                                                               -            (2,277)            -
during the
period
Options                 -           -             722                -       
exercised                                                                               -              (722)            -
during the
period
Balance as at    13,306,007   91,006,858   (18,789,565)   (9,446,062)         176,116    76,253,354
30 September                                                                            -
2012

                                      

                                      

*Share premium represents the premium paid by the shareholders on issue of
shares and is net off equity transaction costs. Under the Indian Companies Act
1956, such a reserve has a restricted usage.



The accompanying notes form an integral part of the condensed interim
financial statements
On behalf of Board of Directors
                                                     

Yogendra Kumar Modi                                  Kashi Nath Memani
Chairman & Chief Executive Officer                   Director
Place: Gurgaon
Date: 27 October 2012

                                      

                                      

                                      

                                      

                                      

                                      

                                      





Great Eastern Energy Corporation
Limited
Condensed statement of cash flows
(All amounts in US dollars unless
otherwise stated)
                                              For the six months ended 30 September
                                                             2012                      2011
                                                      (Unaudited)               (Unaudited)
A. Cash flow from operating activities
   Profit/(Loss) after tax                 4,031,777     (4,916,920)
   Add: tax expense                      
                                                              -                       -
   Profit/(Loss) before tax                   4,031,777       (4,916,920)
   Adjustments for:-
   Provisions/liabilities written back      (234,208)
                                                              -
   Net finance cost                        2,537,375     9,973,475
   Depreciation/amortisation/depletion     1,475,003     1,399,440
   Share based payment expense           (20,381)   (15,526)
   Changes in:
   Trade and other receivables           (81,235)    (399,385)
   Prepayments                           (18,915)    170,022
   Trade and other payables                1,035,295     1,777,807
   Net cash from operating activities         8,958,919       7,754,705
B. Cash flow from investing activities
   Purchase of property, plant and          (14,523,536)      (17,416,749)
   equipment/capital work in
   progress/intangible assets
   Fixed deposits matured/(purchased)      1,269,628     9,831,319
   during the period
   Proceeds from sale of                    177,975
   available-for-sale financial assets                        -
   Interest received                      293,357    808,996
   Income tax paid                       (18,921)   (46,937)
   Net cash used in investing                  (12,979,472)       (6,645,396)
   activities
C. Cash flow from financing activities
   Proceeds from borrowings                9,121,388      14,186,888
   Repayment of long term borrowings       (2,047,840)     (2,357,300)
   Interest paid                           (4,137,900)     (4,091,646)
   Net cash from financing activities         2,935,648       7,737,942
   Net (decrease)/increase in cash and     (1,084,905)     8,847,251
   cash equivalents (A+B+C)
   Cash and cash equivalents at 1          1,514,854    514,780
   April
   Effect of exchange rate fluctuations  (86,261)    (708,618)
   on cash and cash equivalents
   Cash and cash equivalents at 30          343,688       8,653,413
   September



                                      



The accompanying notes form an integral part of the condensed interim
financial statements


On behalf of the Board of Directors
                                                     

Yogendra Kumar Modi                                  Kashi Nath Memani
Chairman & Chief Executive Officer                   Director
Place: Gurgaon
Date: 27 October 2012



Great Eastern Energy Corporation Limited

(All amounts in US dollars unless otherwise stated)



    Notes to condensed interim financial statements



1. Organisation and nature of operations

Great Eastern  Energy Corporation  Limited  ('GEECL' or  'the Company')  is  a 
public limited company  incorporated in  India with its  registered office  at 
M-10, ADDA Industrial Area, Asansol-713305, West Bengal, India. GEECL's shares
were listed as Global Depository Receipts in the Alternate Investment  Market, 
London, upto 27 May 2010. The Company made a publication of its prospectus  in 
relation to the introduction of its Global Depositary Receipts ('GDRs') to the
standard list on the official list of the UK Listing Authority (the  'Official 
List') and admission to trading on the London Stock Exchange Plc's Main Market
for listed securities (the  'Main Market'). Pursuant to  the admission of  its 
GDRs to the standard list on the official list and commencement of trading  in 
the GDRs on the main market on 28  May 2010, trading of the Company's GDRs  on 
AIM has been cancelled.

The Company  was incorporated  in  1992 to  explore, develop,  distribute  and 
market Coal Bed Methane gas or CBM gas in India. GEECL originally entered into
a license  agreement  in December  1993  with  Coal India  Limited  (CIL)  for 
exploration and development of  CBM over an area  of approximately 210 Sq.  km 
(approximately 52,000 acres) in  the Raniganj coalfields  of West Bengal  (the 
block). Following  the  transfer  of  CBM administration  in  India  from  the 
Ministry of Coal  to the Ministry  of Petroleum and  Natural Gas (MoPNG),  the 
Company entered into Production Sharing Contract  (PSC) for CBM gas on 31  May 
2001 with the Government of India for the block.

The PSC has been effective from 9 November 2001 as a result of the granting by
Government of West  Bengal of the  Petroleum Exploration License  on the  same 
date and provides for  a five year initial  assessment and market  development 
phase, followed by a five year  development phase and then a twenty-five  year 
production phase,  extendable with  the approval  of the  Government of  India 
(GOI). Besides this, during  the previous year, the  Company was awarded  with 
Mannargudi block  located in  Tamil Nadu  under  CBM IV  round for  which  the 
Production Sharing Contract was signed with the Government of India on 29 July
2010. In  this regard,  the  Company has  applied  for issuing  two  Petroleum 
Exploration  License  (PEL)  on  September  16,  2010  to  the  Hon'ble  Chief 
Secretary, Government of Tamil  Nadu. One of  the PEL has  been granted on  13 
September 2011. Currently, the Company is carrying out exploration  activities 
in this block.

The Company does not have any subsidiary and accordingly, does not require any
consolidated financial  statements.  Since  the  Company  does  not  have  any 
investments in  associates  and joint  ventures  also, hence  these  financial 
statements are individual financial statements.

The financial statements of the Company as at and for the year ended 31  March 
2012 are available upon request from the Company's registered office at  M-10, 
ADDA Industrial Area, Asansol-713305, West Bengal, India, or at www.geecl.com.



2. Statement of compliance

These condensed interim financial statements have been prepared in  accordance 
with  International  Accounting  Standard  (IAS)  34,  Interim   Financial 
Reporting. These condensed interim financial statements do not include all the
information required for full annual  financial statements and should be  read 
in conjunction with the financial statements of the Company as at and for  the 
year ended 31 March  2012. These condensed  interim financial statements  have 
been authorised for issue by the Board of Directors in its meeting held on  27 
October 2012.





3. Significant accounting policies



The accounting  policies applied  by the  Company in  these condensed  interim 
financial statements  are the  same as  those applied  by the  Company in  its 
financial statements as at and for the year ended 31 March 2012.



4. Estimates



The preparation of  interim financial statements  requires management to  make 
judgements,  estimates  and  assumptions   that  affect  the  application   of 
accounting policies and the reported amounts of assets and liabilities, income
and expense. Actual results may differ from these estimates.



In preparing  these condensed  interim financial  statements, the  significant 
judgements made  by  the  management  in  applying  the  Company's  accounting 
policies and the key sources of estimation uncertainty were the same as  those 
applied to the financial statements as at and for the year ended 31 March 2012





5. Financial risk management



The Company's financial risk management objectives and policies are consistent
with those disclosed in the financial statements as at and for the year  ended 
31 March 2012.





6. Segment reporting



Chief Operating Decision Maker  (CODM) reviews the  business as one  operating 
segment, being the extraction and sale of CBM gas. Hence, no separate  segment 
information has been furnished herewith.



7. a) Property, plant and equipment



During the six-month period ended 30 September 2012, the Company has  acquired 
assets with cost (including capitalized borrowing cost) of USD 12,619,227  (30 
September 2011 : USD 14,392,426)



Movements in property, plant and equipment are as follows:



                                             For the six months ended

                                                   30 September
                                                       2012               2011
Opening balance as at 1 April                    99,273,933         98,725,859
Additions                                   12,619,227      14,392,426
Disposals/adjustments                - 
                                                                           -
Depreciation/amortisation for the          (1,594,214)    (1,615,064)
period
Effect of movements in foreign             (2,473,742)    (9,594,106)
exchange rates
Closing balance as at 30 September             107,825,204        101,909,115



Well capitalisation



During the  six  months  period  ended 30  September  2012,  the  Company  has 
capitalized 12 wells (30 September 2011:
7 wells). All costs involved  in drilling, cementing, fracturing and  drilling 
of exploratory core holes are initially considered as Capital work-in-progress
till the time these are ready for commercial use when they are transferred  to 
producing properties.





Depletion: Commercially producing wells are depleted using unit of  production 
method, based on related proved developed reserves. Proved developed  reserves 
of gas per well are technically  re-assessed, 'in house', normally at the  end 
of each reporting period, based on technical data available.



b) Capital commitments

  

                                                   As at
                                             30 September 2012   31 March 2012
Estimated amount of contracts remaining to
be executed on capital account and not
provided for:-
- For land                                   142,764  128,238
- For others                                 10,459,430  8,490,824
                                                     
                                                    10,602,193       8,619,062





Further, the Company has continuing commitments towards minimum work programme
in terms of production sharing contract for Mannargudi block. Such commitments
aggregate USD 20,610,834 as at 30 September 2012
(31 March 2012: USD 20,742,274).



8. Capital work in progress



During the six-month  period ended  30 September  2012, the  Company has  made 
additions to  Capital work  in  progress, (including  borrowing cost)  of  USD 
15,433,201 (30 September 2011: USD 11,550,063)



Movement in Capital work in
progress is as follows-
                                    For the six months ended 30 September
                                                        2012              2011
Opening balance                         67,657,015  43,847,479
Additions during the year            15,433,201        11,550,063
Capitalization                                     (7,442,140)
                                                 (9,417,093)
Effect of movement in foreign                     (4,143,538)
exchange rates                                   (1,744,193)
Closing balance                         71,928,930  43,811,864





9. Intangible assets



Intangible assets represent gas exploration right, computer software and other
intangibles. During the six months period ended 30 September 2012, the Company
has acquired intangible assets of USD Nil (30 September 2011: USD 17,676)





                                        For the six months ended 30 September

                                                          
                                            2012                          2011
Opening Balance                          361,411                       212,344
Additions                                    -                        17,676
Disposals/adjustments                        -  -
Depreciation/amortisation for the       (26,085)                     (40,069)
period
Effect of movements in foreign         (11,571)                     (16,894)
exchange rates
Closing balance                          323,755                       173,057





10. Intangible under development



During the six months period ended 30 September 2012, the Company has made
additions to intangible under development of USD 92,691 (30 September 2011:
USD 64,473).



                                For the six months ended 30 September

                                                  
                                                     2012                 2011
Opening Balance                                   189,682               73,954
Additions                92,691  64,473
Effect of movements in   (1,955)      
foreign exchange rates                                                (11,305)
Closing balance            280,418              127,122





11. Borrowing cost



The capitalization  rate used  to determine  the borrowing  cost eligible  for 
capitalization in respect of general purpose borrowings is 13.67% p.a for  the 
six months period ended 30 September 2012 ( 30 September 2011: 13.21% p.a) and
6.82% (30 September 2011: 8.43%) in respect of specific purpose borrowings.



During the  six  months  period  ended 30  September  2012,  the  Company  has 
allocated borrowing cost of USD 2,103,101
(30 September 2011: USD 2,323,006)  to fixed assets/capital work in  progress, 
being directly attributable to the  acquisition or construction of  qualifying 
assets. The balance borrowing  cost amounting to  USD 2,781,475 (30  September 
2011: USD 3,091,346) has been charged  to income statement. Borrowing cost  is 
reduced by USD 41,987 (30 September 2011: USD 788,326) in respect of income on
temporary deployment of borrowings by the Company.





12. Income tax



There is no current tax liability in view of losses for the previous  periods. 
Deferred tax asset has not been  recognized in respect of carried forward  tax 
losses  and  unabsorbed  depreciation  because  sufficient  taxable  temporary 
differences are not  available and  the probable  taxable profits  may not  be 
available against which the benefits can be utilised.

13. Loans and borrowings



                  Currency Interest rate   Face   Carrying amount Year of

                                           value                  maturity
                                                     USD
Balance as at 1                                            89,140,036
April 2012
New issues
Secured rupee       INR    Base + 3%        4,110,340       4,020,461   2020
loan [refer note
(a)]
External            EUR    Margin 3.90%     5,462,623       5,255,703   2018
commerical                 + 6 months
borrowings                 Euribor

[refer note (c)]
Repayments
Car loan [refer     INR    9.72%            (22,368)       (22,368)
note (d)]
Secured rupee       INR    PLR +/- 0.25% (1,638,982)    (1,638,982)
loans [refer note          and base rate
(b)]                       + 3.5%
Secured foreign     USD    6 months        (298,438)      (298,438)
currency                   Libor +
loans[refer note           650-1000 bps
(b)]
Other movements
Interest accrued    INR                                       122,711
Amortisation of     INR                                       150,189
loan origination
cost
Conversion of INR   USD                                    14,891,685
loan to USD loan
Conversion of USD   INR                                 (15,891,685)
loan to INR loan
Effect of movements in foreign exchange                    (779,850)
rates
Balance as at 30                                           94,949,462
September 2012
Current                                                    16,461,414
Non-current                                                78,488,048
Total                                                      94,949,462
External commerical borrowing issued during the
period
Proceeds from external commercial                           5,462,623
borrowings
Less:-                                                     (206,920)
transaction cost
Net proceeds                                                5,255,703
Secured rupee loan issued during
the period
Proceeds from secured                                       4,110,340
rupee loan
Less:-                                                      (89,879)
transaction cost
Net proceeds                                                4,020,461





















           Currency Interest rate        Face value         Carrying Year of
                                                              amount  maturity
                                                  USD
Balance as                        The story has been
at 1 April                        truncated,
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