Rialto Reports Net Loss of $170.6 Mln

Rialto Energy Limited, the West African focussed exploration company, announces their audited final results for the year ended 30 June 2013.

Financial Highlights (All $ amounts in AUS$ unless otherwise specified):

· Successful Placing raised $14.1 million with institutional and other investors (closing date fell after 30 June)

· Net loss after tax of $170.6 million (2012: $10.2 million) due to;

– Impairment of $150.8 million for the CI-202 permit in Côte d’Ivoire as a direct consequence of the terms of the Vitol transaction

– Expenditure of $11.6 million resulting from the early termination of the 2013 drilling campaign in Cote d’Ivoire

· Reduced administrative expenses of $7.9 million (2012: $11.5 million)

· Cash and cash equivalents at 30 June 2013 of $5.8 million (includes $0.7 million advance proceeds of the $14.1 million placing)

Operational Highlights:

· Entered into term sheet with Vitol E&P providing for Vitol to:

(a) acquire 65% of Rialto’s Cote d’Ivoire subsidiary in return for funding the first US$50 million of an appraisal and development programme on CI-202; and

(b) acquire up to 51% of Rialto’s Ghana subsidiary in return for providing a letter of credit and funding of up to US$7.7 million for the Starfish well

· Updated Reserves and Resources Report on CI-202 prepared by RPS Energy Services in January 2013

· Terms agreed with drilling contractor regarding early termination of the rig contract for CI-202, thereby allowing technical work to be completed to optimise resource management

Post-Period Highlights:

· Memorandum of Understanding signed with the Côte d’Ivoire Ministry of Oil & Energy, Petroci and Vitol to replace the existing Production Sharing Contract for Block CI-202

· Submission of revised field development plan for Gazelle Field

· Drilling of Starfish-1 well and granting of six month extension for Offshore Accra Contract Area, Ghana

Rob Shepherd, Managing Director of Rialto Energy, commented:

“2013 has been a year of significant transition for Rialto. The Company has been faced with a number of challenges, but we have worked tirelessly to overcome these legacy issues and feel confident that we now have a solid basis from which we can move forward out of a period of uncertainty and look to build an exciting business in West Africa.

“With effectively a new Board, a new partner in Vitol bringing significant experience and expertise to CI-202, an updated Reserves and Resource Report verifying the potential of the block, and a soon to be signed new PSC, the Company has evolved significantly and the management can now draw a line under the previous issues and look forward to the future with confidence.”

Press Release, September 30, 2013

 

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