Financial and Operating Results for the year ended December 31st 2012
During the year ended December 31, 2012 the Company continued its exploration and appraisal campaign in respect of petroleum properties located in the Kurdistan Region of Iraq which constitute the continuing operations of the Company. These petroleum properties have generated no revenues.
On December 31, 2012 GEP completed two principal transactions resulting in the sale of a 53.2% direct interest in the Atrush Block to TAQA Atrush B.V. (“TAQA”), a subsidiary of Abu Dhabi National Energy Company PJSC, and the repurchase from Aspect Energy International, LLC (“Aspect”) of the entire 66.5% shareholding interest which Aspect held in GEP. As a result of the transactions the Company has acquired a 100% shareholding interest in and control of GEP which then held a 26.8% direct interest in the Atrush Block.
The $205 million net income in the year 2012 was primarily comprised of income from associate of $129 million related to the sale by GEP on December 31, 2012 of the 53.2% interest in the Atrush Block and by the gain of $103 million relating to the fair valuation (required by International Financial Reporting Standards on acquiring control) of GEP’s net assets and liabilities (together, the “Fair Value Increase”) offset by $25.7 million of relinquishment fees and other costs relating to the termination of the Pulkhana and Arbat Block PSCs in January 2012. Also during the year the Company sold the 20% direct interest which it held in the Taza Block PSC for net proceeds of $53.3 million resulting in a net gain of $1.1 million.