MIRA INFORM REPORT

 

 

Report Date :

28.06.2007

 

IDENTIFICATION DETAILS

 

Name :

ADDAX PETROLEUM MAGHENA

 

 

Registered Office :

Zone Oprag, P. O. Box 452, Port Gentil

 

 

Country :

Gabon

 

 

Financials (as on) :

31.12.2006

 

 

Date of Incorporation :

1996

 

 

Com. Reg. No.:

RCCM 2003B442

 

 

Legal Form :

Limited Liability Company

 

 

Line of Business :

Gas and oil exploration and production company

 

 

RATING & COMMENTS

 

MIRA’s Rating :

Ba

 

RATING

STATUS

PROPOSED CREDIT LINE

41-55

Ba

Overall operation is considered normal. Capable to meet normal commitments.

Satisfactory

 

Maximum Credit Limit :

CFA Fr 150,000,000

 

 

Status :

Satisfactory

 

 

Payment Behaviour :

Regular

 

 

Litigation :

Clear

 

 

COmpany NAME

 

ADDAX PETROLEUM MAGHENA (Correct)

 

PANAFRICAN MAGHENA INC (Requested)

 

 

ADDRESS

 

Area                             :  Zone Oprag

P.O. Box           :  452

Town                 :  Port Gentil

Country             :  Gabon

Telephone         :  (241) 550 090 / 550 091 / 555 779 (241) 0794 2394 / 0712 3032 / 0739 1174 (mobile)

Fax                   :  (241) 555 782

 

 

Formerly Known As

 

Panafrican Maghena Inc

 

 

SENIOR COMPANY PERSONNEL

 

   Name                                     Position

 

1. David Keneth Robert               Managing Director              

 

2. Mr Robillard                                       Marketing Director

 

 

Total Employees

 

60 (subject)

200 (Addax Gabon)

 

 

PAYMENTS

 

No complaints have been heard regarding payments from local suppliers or banks.

 

Founded in 1994 by the Addax & Oryx Group, Addax Petroleum is an international oil and gas exploration and production company focused on Africa and the Middle East.

 

We consider it is acceptable to deal with subject for MEDIUM amounts, although it is normal accepted practice for international suppliers to deal on secured terms with Gabon importers.

 

Opinion on maximum credit : CFA Fr 150,000,000

 

Trade risk assessment : Normal

 

Opinion on the credit figure of SA RAND 600,000 / 30 days:

 

We consider the above figure to be within the company's financial capabilities.

 

 

SIGNIFICANT CHANGES

 

In July 2006, Addax Petroleum took a significant step in the continuing development of the company and in its history in Gabon with the acquisition of two subsidiaries of Pan-Ocean Energy Corporation Limited: PanAfrican Energy Corporation (Mauritius) Limited ("PanAfrican"), which owns and operates Pan-Ocean Energy's oil exploration, production and marketing business in Gabon, and Pan-Ocean Energy UK Ltd., which provides management and operational services to Pan-Ocean Energy.

 

 

PRINCIPAL BANKERS

 

NAME               : BICIG - BANQUE INTERNATIONALE POUR LE COMMERCE ET L'INDUSTRIE DU GABON

Branch              : Av. du Colonel Parant

PO Box             : 2241

Town                 : Libreville

Telephone         : (241) 762613 / 777505 / 777504

Fax                   : (241) 744034 / 746410

SWIFT              : BICIGAL XXX

 

The company also has an account with the following bank:

 

Citibank

Main

Port Gentil

Tel: (241) 552 935 / 552 936

Fax: (241) 551 557

 

 

FINANCIAL INFORMATION

 

Private companies in Gabon are not required to publish or disclose balance sheets. However, the subject interviewed offered the following information which applies for Addax Petroleum Maghena and its affiliated Addax Petroleum Ramboue:

 

                                             2006

                                         (in thousand of US DLRS)

 

REVENUE

Petroleum sales                              73,642

Royalties                                   (14,248)

Net sales                                    59,394

Other income                                    211

Total net revenue                            59,605

EXPENSES

Operating                                    14,629

General and administrative                        -

Depletion, depreciation and accretion        25,958

Pre-acquisition                                   -

Share-based compensation                          -

Interest on long-term debt                        -

PanAfrican acquisition costs                  3,192

Other interest and finance income                 -

Foreign exchange (gain)/loss                    858

Total expenses                               44,637

Income before provision for income taxes     14,968

Provision for income taxes

Current                                      (6,509)

Future                                            -

Net income                                    8,459

 

Financial year ends 31 December.

 

Consolidated balance sheets of Addax Petroleum as at 31 December showed:

 

                                           2006             2005

                                        (in thousands of US DLRS) ASSETS Current

Cash and cash equivalents                 34,510            6,708

Accounts receivable                      178,695          131,613

Inventories                              121,073           62,753

Prepaid expenses                          25,878           15,506

                                         360,156          216,580

Partner loan receivable                   21,000            2,420

Future income taxes                       15,811          155,884

Deferred financing charges                 3,130            4,763

Other non current assets                   1,631                -

Property, plant and equipment          2,083,491          487,023

Goodwill                                 493,051                -

                                       2,618,114          650,090

                                       2,978,270          866,670

 

LIABILITIES AND SHAREHOLDERS’ EQUITY

Current

Accounts payable and accrued liabilities 364,226          160,113

Income taxes and royalties payable       510,245          203,626

Deferred revenue                           3,329            1,280

                                         877,800          365,019

Asset retirement obligations              47,149           25,266

Future income taxes                       44,209           93,093

Other long-term liabilities               11,096            4,909

Long-term debt                           830,000           80,000

                                         932,454          203,268

Commitments and contingencies

SHAREHOLDERS’ EQUITY

Share capital                            738,769           20,010

Contributed surplus                       19,699                -

Retained earnings                        409,548          278,373

                                       1,168,016          298,383

                                       2,978,270          866,670

 

CONSOLIDATED STATEMENTS OF OPERATIONS

 

REVENUE

Petroleum sales                        2,028,849        1,219,128

Royalties                               (389,126)        (211,005)

Net sales                              1,639,723        1,008,123

Other income                              11,898            5,032

Total net revenue                      1,651,621        1,013,155

EXPENSES

Operating                                203,830          145,103

General and administrative                26,990           26,532

Depletion, depreciation and accretion    316,238          170,298

Pre-acquisition                           26,951           13,900

Share-based compensation                  24,667                -

Interest on long-term debt                22,384            3,638

PanAfrican acquisition costs               4,840                -

Other interest and finance charges           404            1,279

Impairment of property,

plant and equipment                            -            3,162

Foreign exchange (gain)/loss              (1,414)             204

Total expenses                           624,890          364,116

Income before provision for

income taxes                           1,026,731          649,039

Provision for income taxes 

Current                                 (541,131)        (349,057)

Future                                  (242,499)         (93,912)

                                        (783,630)        (442,969)

income                                   243,101          206,070

Earnings per share, basic and diluted

                                           $1.70            $1.76

 

Weighted average number of

common shares outstanding :

basic                                 142,903,298     117,000,000

diluted                               143,036,795     117,000,000

 

Retained earnings, beginning of year      278,373         157,303

income for the year                       243,101         206,070

Distribution of earnings                  (48,188)              -

Dividends                                 (63,738)        (85,000)

Retained earnings, end of year            409,548         278,373

 

 

LEGAL STATUS AND HISTORY

 

Date Started : 1996

 

History : The company was incorporated in Gabon in 1996 as a limited liability company, Panafrican Maghena Inc. It changed its legal status to a joint stock company and adopted the present style in 2006 when it was acquired by Addax.

 

C.R. No. : RCCM 2003B442

 

Capital : CFA Fr 10,000,000

 

Societe a Responsibilite Limitee (limited liability company) with the following sole shareholder :

 

Addax Petroleum (Mauritius) Limited    100 %

(Formerly Panafrican Energy Corporation (Mauritius) Limited)

 

Parent Company

 

Addax Petroleum Services Ltd

Toronto

Canada

 

 

 

Affiliated companies of Addax Petroleum Maghena :

 

Associates

 

Addax Petroleum Ramboue

Gabon

 

 

ACTIVITIES

 

The Company is involved in the following activities :

 

Gas and oil exploration and production company

 

Imports from Canada and USA.

 

Oil is sold to Addax Trading.

 

Subject currently owned 15 rigs and producing 12,000 barils per day, subject also plans to exploit 45 rigs in the 2 next years.

 

The onshore Gabon producing properties are operated by Addax Petroleum. In late November 2006 the Corporation commissioned a new production and export system from the Maghena property. The new system consists of a 30,000 bbl/d production facility at the Tseingui field, a 30 kilometre, 10 inch pipeline from Maghena to the Total Gabon operated Coucal facility and additional heating and pumping capacity at Coucal.

 

 

FACILITIES

 

The Company has the following facilities :

 

Rented offices in Port Gentil.

 

 

SPECIAL NOTE

 

You enquired on : Panafrican Maghena Inc. Please note the correct name is as per heading.

 

 

 

RATING EXPLANATIONS

 

RATING

STATUS

 

 

PROPOSED CREDIT LINE

>86

Aaa

Possesses an extremely sound financial base with the strongest capability for timely payment of interest and principal sums

 

Unlimited

71-85

Aa

Possesses adequate working capital. No caution needed for credit transaction. It has above average (strong) capability for payment of interest and principal sums

 

Large

56-70

A

Financial & operational base are regarded healthy. General unfavourable factors will not cause fatal effect. Satisfactory capability for payment of interest and principal sums

 

Fairly Large

41-55

Ba

Overall operation is considered normal. Capable to meet normal commitments.

 

Satisfactory

26-40

B

Unfavourable & favourable factors carry similar weight in credit consideration. Capability to overcome financial difficulties seems comparatively below average/normal.

 

Small

11-25

Ca

Adverse factors are apparent. Repayment of interest and principal sums in default or expected to be in default upon maturity

 

Limited with full security

<10

C

Absolute credit risk exists. Caution needed to be exercised

 

 

Credit not recommended

NR

In view of the lack of information, we have no basis upon which to recommend credit dealings

No Rating

 

 

This score serves as a reference to assess SC’s credit risk and to set the amount of credit to be extended. It is calculated from a composite of weighted scores obtained from each of the major sections of this report. The assessed factors and their relative weights (as indicated through %) are as follows:

 

Financial condition (40%)            Ownership background (20%)                 Payment record (10%)

Credit history (10%)                    Market trend (10%)                                Operational size (10%)

 

 

 

 

PRIVATE & CONFIDENTIAL : This information is provided to you at your request, you having employed MIPL for such purpose. You will use the information as aid only in determining the propriety of giving credit and generally as an aid to your business and for no other purpose. You will hold the information in strict confidence, and shall not reveal it or make it known to the subject persons, firms or corporations or to any other. MIPL does not warrant the correctness of the information as you hold it free of any liability whatsoever. You will be liable to and indemnify MIPL for any loss, damage or expense, occasioned by your breach or non observance of any one, or more of these conditions