UNLOCKING NAMIBIA’S - Investment Promotion .N UNLOCKING NAMIBIA’S OIL & GAS POTENTIAL Unlocking

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  • Chariot Oil & Gas Limited

    Registered Offi ce:

    Sydney Vane House,

    Admiral Park,

    St. Peter Port,

    Guernsey, GY1 2HU

    www.chariotoilandgas.com

    BrazilEspirito Santo

    Congo

    Angola

    Namibia

    Santos

    Campos

    Sedimentary Basins

    16 Billion BOE14 Billion BOE

    30 Billion BOE!

    PelotasWalvis

    Luderitz

    OrangeBasin

    Africa

    8.4 Tcf (inc 3 Tcf in Kudu)

    5 Billion BOE

    KUDU FIELD

    !

    N UNLOCKING NAMIBIAS OIL & GAS POTENTIAL

    Unlocking Namibias Oil & Gas Potential

    Namibia

    Enigma Licences

    ANNUAL REPORT AND ACCOUNTS FOR THE YEAR ENDED 28 FEBRUARY 2009

  • Chariot Oil & Gas Limited is an AIM listed oil and gas exploration

    company with interests in Namibia.

    Enigma Oil & Gas Exploration (Pty) Limited was incorporated

    in Namibia in 2003. Enigma was acquired by Chariot in January

    2008 and is the holder of the petroleum agreements and licences.

    Enigma is the operator of the licences in Namibia.

    ADVISERS

    Contents

    1 Highlights

    4 Chairmans Statement

    10 Board of Directors

    11 Report of the Directors

    13 Directors Remuneration Report

    15 Social Responsibility Statement

    16 Corporate Governance Statement

    17 Report of the Independent Auditors

    18 Consolidated Income Statement

    19 Consolidated Statement of Changes in Equity

    20 Consolidated Balance Sheet

    21 Consolidated Cash Flow Statement

    22 Notes forming part of the FinancialStatements

    ibc Advisers

    Registered offi ce

    Sydney Vane House,

    Admiral Park,

    St. Peter Port,

    Guernsey, GY1 2HU

    Nominated advisor

    KPMG LLP

    8 Salisbury Square,

    London, EC4Y 8BB

    Broker

    BMO Capital Markets Limited

    95 Queen Victoria Street,

    London, EC4V 4HG

    Bankers

    Barclays Bank PLC

    PO Box 41, Le Marchant House,

    Le Truchot, St Peter Port,

    Guernsey, GY1 3BE

    Auditors

    BDO Stoy Hayward LLP

    55 Baker Street,

    London, W1U 7EU

    Financial PR

    Hogarth

    No1. London Bridge,

    London, SE1 9BG

    Solicitors

    As to English Law

    Memery Crystal LLP

    44 Southampton Buildings,

    London, WC2A 1AP

    As to Namibian Law

    Lorentz Angula Inc.

    Private Bag 12007,

    Ausspannplatz,

    Windhoek 3rd Floor,

    LA Chambers,

    Ausspann Plaza,

    Windhoek, Namibia

    As to Guernsey Law

    Babb

    PO Box 69,

    1820 Smith Street,

    St. Peter Port,

    Guernsey, GY1 4BL

    Company secretary

    Artemis Secretaries Limited

    Sydney Vane House,

    Admiral Park,

    St.Peter Port,

    Guernsey, GY1 2HU

    Registrars and

    receiving agents

    Anson Registrars Limited

    PO Box 426, Anson Place,

    Mill Court, La Charroterie,

    St Peter Port,

    Guernsey, GY1 3WX

    Namibia

    AFRICA

    Chariots key objective is to maximise returns for shareholders by exploring for and proving up resources from its current licences and diversifying its asset base through the introduction of production cashfl ow and other exploration opportunities.

  • 16282 31/07/2009 Proof 11

    1CHARIOT OIL & GAS LIMITED

    Admitted to AIM in May 2008 having raised gross proceeds of 45m (US$88.9m at time of admission)

    Cash balance at 28 February of US$28.9m

    Seismic acquisition programme undertaken across all offshore licences

    Further exploration since admission to AIM has led to expansion of prospect and lead inventory

    Increased gross mean prospective resources to 5.24 billion barrels in licence areas

    Data room opened from mid October to end ofJanuary 2009 with multiple expressions of interest in reviewing data after 3D processing complete

    Farm-out agreed with Petrobras Oil and Gas BV (Petrobras) for a 50%interest on one of the Groups southern offshore licences

    Strengthened cash position

    Highly experienced partner in deep water exploration and development

    Third party endorsement of Namibias prospectivity and potential

    Post period

    Financial year highlights

    Unlocking Namibiasoil and gas potential

    ANNUAL REPORT AND ACCOUNTS FOR THE YEAR ENDED 28 FEBRUARY 2009

    16282CHARIOTOIL.indd 116282CHARIOTOIL.indd 1 31/07/2009 16:1331/07/2009 16:13

  • 16282 31/07/2009 Proof 11

    2

    AT A GLANCE

    Licences covering 10 blocks: 8 offshore, 2 onshore, totalling an area of 15.2 million acres

    Offshore licences of strategic interest

    In counterpart margin to petroliferous province offshore Brazil

    South of prolific basins offshore Angola

    Applying same suite of analysis tools used to help identify potential petroleum

    systems in the pre-salt, deepwater offshore Brazil

    Multidisciplinary exploration approach has demonstrated that offshore Namibia contains mature source rocks and hydrocarbon migration pathways to reservoirs

    One prospect and 22 leads in Chariots blocks to date (four additional prospects created by stacking leads)

    Deep water exploration underexplored with only 3 wells drilled to date in water depths greater than 500m early stages but receiving increased interest

    Potential to become a major oil and gas province

    Key highlights

    Progress and plans

    New 2D and 3D seismic acquired in late 2008 / early 2009 currently in processing with fast track volume under interpretation

    A further 1500km of 3D seismic is currently being acquired in the southern block 2714A in partnership with Petrobras

    Range of production opportunities under review

    Intend to explore other potential farm-out agreements when 2D and 3D seismic processing completed

    16282CHARIOTOIL.indd 216282CHARIOTOIL.indd 2 31/07/2009 16:1331/07/2009 16:13

  • 16282 31/07/2009 Proof 11

    3CHARIOT OIL & GAS LIMITED

    Due to a geological history similar to Brazil and Angola, there is good potential that offshore Namibia has similar petroleum systems

    Key positioning within the South Atlantic margins over 60 billion barrelsof oil equivalent (BOE) of discoveries in South Atlantic

    Oil seepage slicks from RadarSat imagery indicate working petroleum system

    Vast acreage position relative to Brazil and Gulf of Mexico block sizes

    Namibia

    BrazilEspirito Santo

    Congo

    Angola

    Namibia

    Santos

    Campos

    Sedimentary Basins

    16 Billion BOE14 Billion BOE

    30 Billion BOE!

    PelotasWalvis

    Luderitz

    OrangeBasin

    Africa

    8.4 Tcf (inc 3 Tcf in Kudu)

    5 Billion BOE

    KUDU FIELD

    !

    N

    Underexplored frontierregion highly prospective

    ANNUAL REPORT AND ACCOUNTS FOR THE YEAR ENDED 28 FEBRUARY 2009

    16282CHARIOTOIL.indd 316282CHARIOTOIL.indd 3 31/07/2009 16:1331/07/2009 16:13

  • 16282 31/07/2009 Proof 11

    4

    Dear Shareholder,I am pleased to present Chariots fi nal results for the year ended 28 February 2009 and first annual report on the significant progress the

    Group has made since our admission to AIM in May 2008.

    Since our successful admission we have delivered upon a number of our key objectives:

    negotiated a farm-out agreement with Petrobras on one of our southern blocks 2714A offshore Namibia (post period end);

    completed comprehensive seismic acquisition programmes across our offshore interests;

    matured our prospect and lead inventory over our exploration blocks of interest increasing our gross mean prospective resources

    in our Namibian licence areas by over a billion barrels now totalling 5.24 billion barrels;

    opened a dataroom to invite interested parties to investigate our assets with a view to farming down our interests from which

    expressions of interest in viewing further information have been received; and

    undertaken a range of due diligence on potential production and near-term production opportunities.

    The Groups Namibian licences, held by our wholly owned subsidiary Enigma Oil & Gas Exploration (Pty) Ltd (Enigma) continue to be the main

    focus of our efforts to date. We secured licences in Peru in partnership with Jindal Steel and Power Limited (JSPL) in September 2008 although

    as announced post period end in May 2009 we decided not to sign for these exploratory blocks. As part of a strategic review, JSPL decided to

    withdraw from the licence application and rather than fund 100% of the exploration programme in Peru, we also withdrew, opting instead to

    concentrate on our existing assets and pursue potential production and exploration opportunities.

    Progress over the past year has served to further highlight the potential of our Namibian blocks. The farm-out agreement with Petrobras

    is a significant endorsement of both the prospectivity of our licence areas and Namibias potential to become an oil and gas region. The

    continued success reported offshore Brazil, with further multi-billion barrel discoveries announced in deep water, pre-salt environments and

    in neighbouring Angola, has also led to increased interest in this region of the South Atlantic. Chariots geochemical analysis of hydrocarbons

    from offshore Namibia suggest the same source rocks as in offshore Brazil may be present and actively generating oil and gas. Namibia is still

    underexplored from an oil and gas perspective but we are confident we are in a key strategic position within a frontier that could well attract

    significant interest from major oil companies.

    Farm-out agreed with PetrobrasAs announced o