10-Q: Quarterly report pursuant to Section 13 or 15(d)
Published on November 12, 2024
1
Table of Contents
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_________________________
FORM 10-Q
_________________________
(Mark One)
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
|
For the quarterly period ended September 30, 2024
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
|
For the transition period from to
Commission file number 001-42149
_________________________
(Exact name of registrant as specified in its charter)
_________________________
(State or other jurisdiction of
incorporation or organization)
|
(I.R.S. Employer
Identification No.)
|
||
(Address of Principal Executive Offices) |
(Zip Code) |
(+61 ) 2 8330 6626
Registrant’s telephone number, including area code
Securities registered pursuant to Section 12(b) of the Act:
Title of each class |
Trading Symbol(s) |
Name of each exchange on which registered |
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required
to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
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Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be
submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such
shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a
smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated
filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.
Large accelerated filer |
☐ |
Accelerated filer |
☐ |
|
☒ |
Smaller reporting company |
|||
Emerging growth company |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition
period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the
Exchange Act.
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).
Yes ☐ No ☒
The number of shares of common stock, par value $0.001, of Tamboran Resources Corporation outstanding as of
November 1, 2024 was 14,224,274 .
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4
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Part I - Financial Information
Item 1. Financial Statements.
The Condensed Consolidated Financial Statements of Tamboran Resources Corporation (the “Company”)
presented herein are unaudited but, in the opinion of management, reflect all adjustments necessary to present fairly such
information for the periods and at the dates indicated. All adjustments are of a normal recurring nature. Because the
following unaudited Condensed Consolidated Financial Statements have been prepared in accordance with Article 10 of
Regulation S-X, they do not contain all information and footnotes normally contained in annual consolidated financial
statements; accordingly, they should be read in conjunction with the Consolidated Financial Statements and notes thereto
appearing in the Company’s Annual Report on Form 10-K for the year ended June 30, 2024.
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TAMBORAN RESOURCES CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(In dollars)
Note |
September 30,
2024
|
June 30,
2024
|
|||
ASSETS |
|||||
Current assets |
|||||
Cash and cash equivalents |
$ |
$ |
|||
Trade and other receivables: |
|||||
Joint interest billing |
|||||
ATO receivable |
|||||
Other tax receivables |
|||||
Assets held for sale |
3 |
||||
Prepaid expenses and other current assets |
|||||
Total current assets |
|||||
Natural gas properties, successful efforts method: |
|||||
Unproved properties |
3 |
||||
Assets under construction - natural gas equipment |
3 |
||||
Property, plant and equipment, net |
3 |
||||
Operating lease right-of-use assets |
4 |
||||
Finance lease right-of-use assets |
4 |
||||
Prepaid expenses and other non-current assets |
|||||
Total non-current assets |
|||||
TOTAL ASSETS |
$ |
$ |
|||
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|||||
Current liabilities |
|||||
Accounts payable and accrued expenses |
5 |
$ |
$ |
||
Current portion of operating lease obligations |
4 |
||||
Current portion of finance lease obligations |
4 |
||||
Total current liabilities |
|||||
Operating lease obligations |
4 |
||||
Finance lease obligations |
4 |
||||
Asset retirement obligations |
6 |
||||
Other non-current liabilities |
|||||
Total non-current liabilities |
|||||
Total liabilities |
|||||
Commitments and contingencies (Note 11) |
|||||
Stockholders’ equity |
|||||
Common stock, $
stock authorized;
outstanding at September 30, 2024 and June 30, 2024, respectively.
|
7 |
||||
Additional paid-in capital |
|||||
Accumulated other comprehensive loss |
( |
( |
|||
Accumulated deficit |
( |
( |
|||
Total Tamboran Resources Corporation
stockholders’ equity
|
|||||
Noncontrolling interest |
|||||
Total stockholders’ equity |
|||||
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY |
$ |
$ |
The accompanying notes are an integral part of these condensed consolidated financial statements.
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TAMBORAN RESOURCES CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
(UNAUDITED)
(In dollars, except share amounts)
Three months ended September 30, |
|||||
Note |
2024 |
2023 |
|||
Revenue and other operating income |
$ |
$ |
|||
Operating costs and expenses |
|||||
Compensation and benefits, including stock-based compensation |
( |
( |
|||
Consultancy, legal and professional fees |
( |
( |
|||
Depreciation and amortization |
( |
( |
|||
Loss on remeasurement of assets classified as held for sale |
3 |
( |
|||
Accretion of asset retirement obligations |
6 |
( |
( |
||
Exploration expense |
( |
( |
|||
General and administrative |
( |
( |
|||
Total operating costs and expenses |
( |
( |
|||
Loss from operations |
( |
( |
|||
Other income (expense) |
|||||
Interest income, net |
|||||
Foreign exchange (loss) gain, net |
( |
||||
Other expenses, net |
( |
( |
|||
Total other income (expense) |
|||||
Net loss |
( |
( |
|||
Less: Net loss attributable to noncontrolling interest |
( |
( |
|||
Net loss attributable to Tamboran Resources Corporation stockholders |
$( |
$( |
|||
Comprehensive income (loss) |
|||||
Net loss |
$( |
$( |
|||
Other comprehensive income (loss) |
|||||
Foreign currency translation |
( |
||||
Total comprehensive income (loss) |
( |
||||
Less: Total comprehensive income (loss) attributable to noncontrolling interest |
( |
||||
Total comprehensive income (loss) attributable to Tamboran Resources
Corporation stockholders
|
$ |
$( |
|||
Net loss per common stock |
|||||
Basic and diluted |
10 |
$( |
$( |
||
Weighted average number of common stock outstanding |
|||||
Basic and diluted |
10 |
The accompanying notes are an integral part of these condensed consolidated financial statements.
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TAMBORAN RESOURCES CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (UNAUDITED)
(In dollars)
Common
stock
|
Additional
paid-in capital
|
Accumulated
other
comprehensive
loss
|
Accumulated
deficit
|
Total
Tamboran
Resources
stockholders’
equity
|
Noncontrolling
interest
|
Total
stockholders’
equity
|
|||||||
Balance at July 1,
2023
|
$ |
$ |
$( |
$( |
$ |
$ |
$ |
||||||
Issuance of
common stock, net
of issuance cost
|
— |
— |
— |
||||||||||
Contributions from
noncontrolling
interest holders
|
— |
— |
— |
— |
— |
||||||||
Stock-based
compensation
|
— |
— |
— |
— |
|||||||||
Foreign exchange
translation
|
— |
— |
( |
— |
( |
( |
( |
||||||
Net loss |
— |
— |
— |
( |
( |
( |
( |
||||||
Balance at
September 30,
2023
|
$ |
$ |
$( |
$( |
$ |
$ |
$ |
||||||
Balance at July 1,
2024
|
$ |
$ |
$( |
$( |
$ |
$ |
$ |
||||||
Issuance of
common stock
under greenshoe
option, net of
issuance cost
|
— |
— |
— |
||||||||||
Contributions from
noncontrolling
interest holders
|
— |
— |
— |
— |
— |
||||||||
Stock-based
compensation
|
— |
— |
— |
— |
|||||||||
Foreign exchange
translation
|
— |
— |
— |
||||||||||
Net loss |
— |
— |
— |
( |
( |
( |
( |
||||||
Balance at
September 30,
2024
|
$ |
$ |
$( |
$( |
$ |
$ |
$ |
The accompanying notes are an integral part of these condensed consolidated financial statements.
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TAMBORAN RESOURCES CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
(In dollars)
Three months ended September 30, |
|||
2024 |
2023 |
||
Cash flows from operating activities: |
|||
Net loss |
$( |
$( |
|
Adjustments to reconcile net loss to net cash provided by operating activities: |
|||
Depreciation and amortization |
|||
Stock-based compensation |
|||
Foreign exchange (gain) loss, net |
( |
||
Loss on remeasurement of assets classified as held for sale |
|||
Accretion of asset retirement obligations |
|||
Changes in operating assets and liabilities: |
|||
Trade and other receivables |
|||
Prepaid expenses and other assets |
( |
( |
|
Accounts payable and accrued expenses |
( |
||
Other non-current liabilities |
|||
Net cash used in operating activities |
( |
( |
|
Cash flows from investing activities: |
|||
Payments for exploration and evaluation |
( |
( |
|
Payments for assets under construction |
( |
||
Advance received for sale of assets held for sale |
|||
Net cash used in investing activities |
( |
( |
|
Cash flows from financing activities: |
|||
Proceeds from issue of common stock |
— |
||
Proceeds from issue of shares under greenshoe option |
— |
||
Contributions received from noncontrolling interest holders |
|||
Common stock issue transaction costs |
( |
( |
|
Net cash from financing activities |
|||
Net (decrease) increase in cash and cash equivalents and restricted cash |
( |
||
Cash and cash equivalents and restricted cash at the beginning of period |
|||
Effects of exchange rate changes on cash and cash equivalents |
|||
Cash and cash equivalents and restricted cash at the end of period |
$ |
$ |
|
Supplemental cash flow information: |
|||
Non-cash investing and financing activities: |
|||
Accrued capital expenditure |
$ |
$ |
|
Asset retirement obligations |
$( |
$( |
|
Stock-based compensation |
$( |
$( |
|
Contribution receivable from noncontrolling interest holders |
$ |
$ |
|
Operating lease right-of-use assets and lease liabilities |
$( |
$( |
|
Interest accrued on finance lease liabilities |
$( |
$( |
|
Finance lease right-of-use assets and lease liabilities |
$ |
$( |
|
Non-cash finance lease costs capitalized to unproved properties |
$ |
$ |
The accompanying notes are an integral part of these condensed consolidated financial statements.
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TAMBORAN RESOURCES CORPORATION
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
General
Tamboran Resources Corporation (the “Company” or “Tamboran” and together with its consolidated subsidiaries,
the “Group”) is an early-stage growth-oriented natural gas company with a vision of supporting the net zero CO2 energy
transition in Australia and Asia-Pacific through developing low CO2 unconventional gas resources in the Northern
Territory (“NT”) of Australia. The Group is in the exploration stage with a current focus on exploiting its primary assets,
which are rights to working interests (“Tenements”) in exploration acreage in the Beetaloo sub-basin (“Beetaloo” or
“Beetaloo Basin”), NT Australia. To date, the Group has not determined whether the Tenements contains any natural gas
reserves that are economically recoverable. Further, the Group had no revenues from its gas operations as of September 30,
2024.
The accompanying condensed consolidated financial statements have been prepared on the basis that the Group will
continue as a going concern which contemplates the realization of assets and the satisfaction of liabilities in the ordinary
and usual course of business.
As of September 30, 2024, the Group had:
•not generated revenues since inception, and is unlikely to generate earnings in the immediate or foreseeable
future;
•a working capital surplus of $47,264,270 (excluding assets held for sale);
•an accumulated deficit of $136,274,345 since inception; and
•significant expenditures planned for the unproved properties in the next 12 months.
These factors raise substantial doubt regarding the Group’s ability to continue as a going concern for the 12 months
following the date these condensed consolidated financial statements were available for issuance. The continuation of the
Group as a going concern is dependent upon the ability of the Group to obtain necessary additional capital to fund ongoing
exploration, appraisal and development projects and/or obtain gas producing properties to attain future profitable
operations. No assurance can be given that the Group will be successful in these efforts in the future.
Management has several plans in various stages of progress to source additional funding to provide operating capital
for continued growth of the Group. Therefore, these condensed consolidated financial statements do not include any
adjustments related to the recoverability and classification of recorded assets and liabilities that might be necessary should
The accompanying condensed consolidated financial statements have been prepared in conformity with the
accounting principles generally accepted in the United States of America (“U.S. GAAP”) and rules and regulations of the
Securities and Exchange Commission (“SEC”) applicable to interim financial statements. Pursuant to such rules and
regulations, certain disclosures and information required by U.S. GAAP for complete consolidated financial statements
have been condensed or omitted. The accompanying condensed consolidated financial statements and notes therein should
be read in conjunction with the financial statements and notes included in our consolidated financial statements for the year
ended June 30, 2024 (“Group’s Annual Financial Statements”).
These condensed consolidated financial statements reflect all adjustments, in the opinion of management, which
include normal and recurring adjustments necessary to fairly state the Group’s consolidated financial position, results of
operations, and cash flows for the periods presented herein. The interim results are not necessarily indicative of results for
any other future annual or interim period. The June 30, 2024, condensed consolidated balance sheet was derived from the
audited Group’s Annual Financial Statements but does not include all disclosures required by U.S. GAAP for annual
financial statements.
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The preparation of these condensed consolidated financial statements in conformity with U.S. GAAP requires
management to make certain estimates and assumptions that affect the amounts of assets and liabilities, revenue and
expenses and related disclosures of contingent assets and liabilities reported in the condensed consolidated financial
statements and the accompanying notes. There have been no significant changes to the Group’s accounting estimates from
Significant Accounting Policies
The Group’s significant accounting policies are described in the notes to the consolidated financial statements for the
year ended June 30, 2024, included in the Group’s Annual Financial Statements. There have been no significant changes in
accounting policies during the three months ended September 30, 2024.
These condensed consolidated financial statements are presented in US dollars (“$” or “dollars”) and the functional
currency of the Group is the Australian Dollar (“A$”). Adjustments resulting from the translation of functional currency
financial statements to reporting currency are accumulated and reported as a part of “Accumulated Other Comprehensive
Loss”, a separate component of stockholders’ equity.
Foreign Currency Transactions
Foreign currency transactions are translated into the Company’s functional currency using the exchange rates
prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such
transactions and from the translation at financial year-end exchange rates of monetary assets and liabilities denominated in
As a Lessee
The Group accounts for leases under ASC 842, Leases (“ASC 842”). The Group determines if an arrangement is a
lease at inception of the arrangement and if such lease will be classified as an operating lease or a finance lease. The
Group’s leases represent its right to use an underlying asset for the lease term. Right-of-use (“ROU”) assets and liabilities
are recognized at the lease commencement date based on the present value of lease payments over the lease term. As the
Group’s leases do not provide an implicit rate, the Group used a proxy for its incremental borrowing rate, which is the rate
incurred to borrow on a collateralized basis over a similar term, an amount equal to the lease payments in a similar
economic environment.
The Group has elected to account for lease and non-lease components in its contracts as a single lease component for
all asset classes except for office premises.
Operating leases are included in “Operating lease right-of-use assets” within the Group’s condensed consolidated
balance sheet. The Group’s related obligation to make lease payments are included in “Current portion of operating lease
obligations” and “Operating lease obligations” within the Group’s condensed consolidated balance sheet. Operating lease
expense for lease payments is recognized on a straight-line basis over the lease term.
Finance leases are included in “Finance lease right-of-use assets” within the Group’s condensed consolidated balance
sheet. The Group’s related obligation to make lease payments are included in “Current portion of finance lease obligations”
and “Finance lease obligations” within the Group’s condensed consolidated balance sheet. Finance lease expense includes
amortization of the ROU assets and interest on lease liabilities. The Group capitalizes the finance lease expense as a part of
unproved properties when the leased asset is directly involved in the drilling of wells (i.e. the finance lease expense is a
direct cost of drilling wells).
Leases with a lease term of 12 months or less are not recorded on the condensed consolidated balance sheet and are
recognized as lease expense on a straight-line basis over the lease term. When it is reasonably certain the Group will
11
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Sublease income is recognized on a straight-line basis over the term of the sublease agreement and is recorded within
The Group is in the exploration stage and has not yet realized any revenues from its operations. The Group holds a
number of exploration permits that are grouped into areas of interest according to geographical and geological attributes.
Expenditure incurred in each area of interest is accounted for using the successful efforts method, as defined within ASC
932, Extractive Activities – Oil and Gas.
Under this method, all general exploration and evaluation costs such as geological and geophysical costs are
expensed as incurred. The direct costs of acquiring the rights to explore, drilling exploratory wells, and evaluating the
results of drilling are capitalized as exploration and evaluation assets (as a part of unproved properties) pending the
determination of the results of the well. If a well does not result in hydrocarbons being present, the previously capitalized
costs are immediately expensed.
Tamboran (B1) Pty Ltd (“TB1”) is a 50/50 joint venture between the Company, through its wholly owned subsidiary
Tamboran (West) Pty Ltd (“TR West”), and Daly Waters Energy, LP ("DWE") governed by the amended and restated joint
venture and shareholders agreement dated June 3, 2024 (the “TB1 Joint Venture Agreement”). In assessing the primary
beneficiary of TB1, the Company determined the primary activities that most significantly impact the economic
performance of TB1 include serving as the manager, determining the strategy and direction of TB1, and the power to create
a budget.
The Company was appointed as the manager to manage and carry out day-to-day operations which supports the basis
of Tamboran as the primary beneficiary. The Company, as manager, also prepares the work plans and budget of TB1. As
such it was determined that the Company has the power to direct TB1’s activities that most significantly impact TB1’s
economic performance. As a result of the assessment performed, the results of TB1 have been included in the
accompanying condensed consolidated financial statements. TB1 has no assets that are collateral for or restricted solely to
settle its obligations. The creditors of TB1 do not have recourse to the Group’s general credit.
The Company also assessed which party to the TB1 Joint Venture Agreement has the obligation to absorb losses or
the right to receive the benefits of the VIE that could potentially be significant to the VIE. The future profits and losses of
TB1 are shared by the Company and DWE in proportion to their respective equity interest in TB1, however, to date the
Company has contributed a greater proportion of the capital and has no ability to recoup any of the excess funding the
Company has made to TB1 from DWE and therefore has a greater exposure to absorb losses.
A loan was provided to TR West from Tamboran Resources Pty Ltd (formerly known as Tamboran Resources
Limited) ("TR Ltd."), a wholly owned subsidiary of the Company. The loan was used by TR West to acquire its interest in
TB1. On November 9, 2022, TB1 completed the acquisition of a 77.5 % share of Beetaloo Basin assets, EP 76, EP 98, and
EP 117. As a result of the TB1 Joint Venture Agreement, the Company and DWE each beneficially acquired a 38.75 %
interest in the permits for the total undivided interest of 77.5 %. Falcon Oil and Gas Australia limited ("Falcon") holds the
remaining undivided interest of 22.5 % in the assets (collectively known as the "Beetaloo Joint Venture").
On March 4, 2024, Falcon, the owner of the remaining 22.5 % interest in the Beetaloo Joint Venture assets, capped its
participation to 5 % in the Beetaloo Joint Venture’s second Shenandoah South well pad (“SS2”). On March 21, 2024,
Tamboran B2 Pty Ltd ("TB1 Operator") (a wholly owned subsidiary of TB1 in which the Company has a 50 % interest)
agreed to pick up Falcon’s interest, increasing TB1 Operator’s working interest to at least 95 % in the wells drilled from the
SS2 well pad.
12
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condensed consolidated balance sheet as of September 30, 2024 and June 30, 2024:
September 30,
2024
|
June 30,
2024
|
||
ASSETS |
|||
Current assets |
|||
Cash and cash equivalents |
$ |
$ |
|
Trade and other receivables: |
|||
Joint interest billing |
|||
Intercompany receivable |
|||
ATO receivable |
|||
Prepaid expenses and other current assets |
|||
Total current assets |
|||
Natural gas properties, successful efforts method: |
|||
Unproved properties |
|||
Assets under construction- natural gas equipment |
|||
Finance lease right-of-use assets |
|||
Prepaid expenses and other non-current assets |
|||
Total non-current assets |
|||
TOTAL ASSETS |
$ |
$ |
|
LIABILITIES |
|||
Current liabilities |
|||
Accounts payable and accrued expenses |
$ |
$ |
|
Current portion of finance lease obligations |
|||
Total current liabilities |
|||
Finance lease obligations |
|||
Asset retirement obligations |
|||
Loan from Tamboran |
|||
Total non-current liabilities |
|||
TOTAL LIABILITIES |
$ |
$ |
Natural Gas Properties
The Group held unproved natural gas properties as of September 30, 2024 and June 30, 2024, amounting to
$259,656,933 and $230,119,448 , respectively. These amounts reflect the Group’s exploration and evaluation projects,
which are pending the determination of proven and probable reserves and were not being depleted for the three months
ended September 30, 2024, and 2023. These assets will be reclassified to proven gas properties upon commencement of
production and then subsequently depleted.
During the three months ended September 30, 2024 and September 30, 2023, the Group recognized no impairment
related to unproved natural gas properties.
Natural gas properties |
|||||||
EP 161 |
EP136 |
EP 76, 98 and
117
|
Total |
||||
Balance at July 1, 2024 |
$ |
$ |
$ |
$ |
|||
Capital expenditure |
|||||||
Restoration assets |
|||||||
Interest on finance lease liability and related
depreciation of ROU assets capitalized
|
|||||||
Effect of changes in foreign exchange rates |
|||||||
Balance at September 30, 2024 |
$ |
$ |
$ |
$ |
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Property, Plant and Equipment
The Group held property, plant and equipment, including leasehold improvements, as of September 30, 2024 and
June 30, 2024, amounting to $74,792 and $102,244 , respectively.
Assets Under Construction
In April, 2024 the Group began to execute agreements for long lead items required for the Sturt Plateau Compression
Facility (“SPCF”) in the Beetaloo Basin. These items included essential plant components comprising of a compressor and
dehydration unit that would convert future raw gas to meet sales gas quality, subject to the terms of definitive development
agreements. During the three months ended September 30, 2024, the Group commenced detailed design of the SPCF. The
Group held total assets under construction related to the SPCF as of September 30, 2024 and June 30, 2024 of $10,411,399
and $7,542,064 respectively.
The 40 MMcf/d SPCF is expected to be connected to the Amadeus Gas Pipeline ("AGP") via the construction of
the 35 -kilometer Sturt Plateau Pipeline ("SPP") subject to achieving project milestones and executing further agreements.
Loss on Assets Classified as Held for Sale
During the three months ended September 30, 2024, the Group had rig 403 classified as held for sale. In September,
2024, the Group entered into an exclusivity agreement with a third party for the sale of rig 403 for $8,500,000 (excluding a
sales commission of 6 %). On September 30, 2024, the Group received a non-refundable advance payment of $400,000 for
a 30-day exclusivity period. As this exclusivity agreement indicated a firm offer, the Group recognized a loss on assets held
for sale of $376,000 to reduce the asset to the lower of its carrying amount and the fair value less costs to sell.
Subsequent to September 30, 2024, the Group completed the sale of rig 403. Refer to Note 13 for additional details.
As a Lessee
The Group’s operating lease activities consist of leases for office premises.
cing July 1, 2024, the Group entered into a new lease agreement with Drecom Pty Ltd ATF English Family Trust for their
office premises in Darwin, Australia. The term of the lease is three years , with an option to further renew the lease for two
Commencing October 1, 2023, the Group entered into a new lease agreement with Lendlease IMT (OITST ST) Pty
Ltd for their office premises in Barangaroo, Australia. The term of the lease is four years , with no option to renew.
On September 9, 2022, Sweetpea Petroleum Pty Ltd (“Sweetpea”), a wholly owned subsidiary of Tamboran, entered
into a drilling contract with Helmerich & Payne International Holdings LLC ("H&P") for H&P to assist the Group in
carrying out its onshore drilling operations in Australia. The drilling contract grants Tamboran the right to use the drilling
rig from H&P over the non-cancellable contract term of 25 months starting from July 1, 2023. Under the terms of the
agreement, the Group has the right to place the drilling rig on a temporary suspension rate between wells for a period up to
term. As of September 30, 2024, the end date of the drilling contract for the current rig is mid-July 2026. The drilling
contract is recognized as a finance lease under ASC 842 (“H&P Rig Lease”).
The present value of the minimum future obligations was calculated based on an interest rate of 13.5 % p.a., which
was recognized in finance lease liabilities in the condensed consolidated balance sheet.
14
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balance sheets:
September 30,
2024
|
June 30,
2024
|
||
Right-of-use assets: |
|||
Operating lease right-of-use assets |
$ |
$ |
|
Finance lease right-of-use assets |
|||
Lease liabilities: |
|||
Current portion of operating lease obligations |
|||
Non-current portion of operating lease obligations |
|||
Current portion of finance lease obligations |
|||
Non-current portion of finance lease obligations |
|||
$ |
$ |
Three months ended September 30, |
|||
2024 |
2023 |
||
Operating leases: |
|||
Operating lease cost charged to profit and loss |
$ |
$ |
|
Finance leases: |
|||
Interest on lease liabilities |
|||
Depreciation on right-of-use assets |
|||
Total finance lease cost |
|||
Less: Lease cost capitalized to unproved properties |
( |
( |
|
Finance lease cost charged to profit and loss |
$ |
$ |
September 30, 2024, and 2023:
Three months ended
September 30,
|
|||
2024 |
2023 |
||
Cash paid for amounts included in the measurement of lease liabilities: |
|||
Operating cash flows for operating leases |
$ |
$ |
|
Financing cash flows for finance leases |
|||
$ |
$ |
ended September 30, 2024, and 2023:
Three months ended
September 30,
|
|||
2024 |
2023 |
||
Operating leases: |
|||
Weighted-average remaining lease term |
|||
Weighted-average incremental borrowing rate |
|||
Finance leases: |
|||
Weighted-average remaining lease term |
|||
Weighted-average incremental borrowing rate |
15
Table of Contents
as follows:
As at September 30, 2024 |
Operating leases |
Finance leases |
|
Fiscal year ending June 30, 2025 (excluding three months period
from July 1, 2024 to September 30, 2024)
|
$ |
$ |
|
Fiscal year ending June 30, 2026 |
|||
Fiscal year ending June 30, 2027 |
|||
Thereafter |
|||
Total lease payments |
|||
Less: Imputed interest |
( |
( |
|
Present value of lease liabilities |
$ |
$ |
As a Lessor
On October 15, 2023, the Group entered into an agreement with a third party to sublease its former office premises in
Manly, Australia. The commencement date of the sublease was October 1, 2023, with a lease term of 17 months. Sublease
income for the three months ended September 30, 2024, was $81,637 and is included within “Other expenses, net” on the
Group’s condensed consolidated statements of operations and comprehensive loss. There have been no indications of
September 30,
2024
|
June 30,
2024
|
||
Accounts payable |
$ |
$ |
|
Accrued payroll |
|||
Compensated absences |
|||
Defined contribution superannuation payable |
|||
Accrued capital expenditure |
|||
Accrued expenses |
|||
$ |
$ |
The Group recognizes the liability for an asset retirement obligation at their estimated fair value in the period in
which the obligation originates. Fair value is estimated using the present value technique (level 2) based on a number of
observable inputs including estimates and assumptions such as future retirement costs, future inflation rates and the
Group’s credit-adjusted risk-free interest rate.
The Group capitalized the present value of the estimated asset retirement obligations as a part of the carrying amount
of the related natural gas properties. The liability has been accreted to its present value for three months ended
September 30, 2024.
follows:
Three months
ended
September 30, 2024
|
|
Beginning asset retirement obligations |
$ |
Liabilities incurred |
|
Accretion expense |
|
Effect of changes in foreign exchange rates |
|
Long-term asset retirement obligations |
$ |
16
Table of Contents
Date |
Tamboran
common stock
|
Issue price |
Details |
Net proceeds |
|||||
Balance at July 1, 2024 |
$ |
||||||||
Capital raise |
July 2024 |
$ |
$ |
||||||
Less: Transaction costs |
— |
$( |
|||||||