NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 
 
NOTE 18 – EXPLORATION AND EVALUATION EXPENDITURE    
 2014 2013 
Year ended 31 December US$’000 US$’000 
   
Costs carried forward in respect of areas of interest in:   
Exploration and evaluation phase, at cost        156,680    167,694 
Provision for impairment      (1,550)      (1,550) 
Total Exploration and Evaluation Expenditure    155,130    166,144 
   
a) Movements in carrying amounts:   
Exploration and evaluation   
Balance at the beginning of the period   166,144    33,439 
Amounts capitalised during the period 39,670 14,770 
Fair value of assets acquired - 151,115 
Allocation of working interest assets acquired 34,184 - 
Exploration costs expensed (1) (10,934) - 
Reclassifications to assets held for sale - (1,104) 
Amounts transferred to development phase (59,209) (31,999) 
Exploration tenements sold during the period    (14,725)            (77) 
Balance at end of period    155,130    166,144 
 
(1) The Company drilled three exploratory wells in the Anadarko Basin that did not have economically 
recoverable reserves (i.e. dry wells) and as such, all associated costs were written off.  
 
In July 2014, the Company acquired the working interest in approximately 9,200 gross (5,700 net) in Dimmit County, 
Texas.  The purchase price included an initial cash payment of $3 5.5 million and a commitment to drill four Eagle 
Ford wells.  The purchase price was allocated between exploration and evaluation and development and production 
assets based on discounted cash flows of developed producing wells.  
 
The ultimate recoupment of costs carried forward for exploration phase is dependent on the successful development 
and commercial exploitation or sale of respective areas. 
 
NOTE 19 – PROPERTY AND EQUIPMENT 
 2014 2013 
Year ended 31 December US$’000 US$’000 
   
Property and equipment, at cost             2,570      1,603 
Accumulated depreciation    (1,016)       (556) 
Total Property and Equipment      1,554      1,047 
   
a) Movements in carrying amounts:   
   
Balance at the beginning of the period        1,047        423 
Amounts capitalised during the period 967 886 
Depreciation expense       (460)       (262) 
Balance at end of period      1,554      1,047 
  
- 85 -