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4 January 2007 GOLD OIL plc ("Gold Oil" or "the Company") Copies of the Interim Report have been posted to shareholders and are also available for collection at the offices of the Company, free of charge, Finsgate, 5-7 Cranwood Street, London EC1V 9EE during normal office hours. Chairman's Statement to Shareholders Since the publication of the 2006 Annual Report the Company, on 9 November 2006, restarted testing operations on its Peruvian exploration well on Block XXI, San Alberto-1X. Testing continued until 7 December 2006 when the well was plugged and abandoned. When testing first started, only highly saline water was produced from the lower Palaeozoic and at the start of the recent operations a cement plug was placed at the base of the well with the intention of shutting off the water. However, all the higher Palaeozoic zones that logs had indicated to be hydrocarbon bearing also produced highly saline water. The Tertiary Upper Verdun sands, also interpreted as containing hydrocarbons, when perforated and tested produced only highly saline water. We will analyse the information gained from the well and make a decision in about six months time on drilling a new well to retest the Tertiary and Palaeozoic reservoirs. On 5 December the Exploration and Exploitation Contract for our offshore Block Z34 was signed by the Board of Perupetro. The Contract is for 30 years but has to be ratified by the Minister for Energy and Mines which we expect will take place early in 2007. The Company is operator with 50% and our partner is Plectrum Oil & Gas. In Colombia the operator started production from the Nancy field in October 2006 at an average stabilised rate of 485.6 bopd (net to Gold's 40% interest and after Royalty and State share - 91.3 bopd). The Company has agreed with the operator of the Nancy- Burdine-Maxine licence to carry out more workovers in the Nancy and Burdine fields which should contribute a significant additional production and cash flow to the company. In June 2006 the Company raised £2.4 million through a placement of 47 million new shares at 7.5 pence per ordinary share and if all 23.5 million Warrants, at an exercise price of 7.5p/share, are exercised before the end of December then an additional £1.8 million will have been raised. Although at the end of the period the Company, since trading commenced, showed a loss of £1.2 million, the cash balance was £2.9 million, reflecting the hard work by the Company's staff to work efficiently and control costs. Looking ahead I expect in 2007 to see the Company carrying out seismic on Block Z34 and a possible new well on Block XXI. The Company is continuing to seek out low risk oil and gas reserves in Colombia and Peru that will generate cash as well as additional exploration acreage in both countries. Due to the energy and dedication of our team, the Company has made very good progress and despite the initial disappointment on our first well in Peru I look forward to the progress that we will make in 2007. For further information, please contact: Michael Burchell, Director, Gold Oil plc on 01372 361772 Roland Cornish, Beaumont Cornish Limited on 020 7628 3396 Consolidated Profit and Loss Account for the Six Months to 31 October 2006 Note 6 Months to 6 Months to Year to 31 October 31 October 30 April 2006 2005 2006 Unaudited Audited Audited £'000 £'000 £'000 Turnover - - - Administrative expenses (340) (334) (698) Operating loss (340) (334) (698) Interest received 86 83 141 Loss on ordinary activities before (254) (251) (557) taxation Taxation - - - Loss on ordinary activities after taxation (254) (251) (557) Dividends - - - Deficit for the period (254) (251) (557) Loss per share:Basic 2 (0.06p) (0.07p) (0.16p) Diluted (0.05p) (0.07p) (0.14p) The company's turnover and operating loss arise from continuing operations. There were no recognised gains or losses other than those recognised in the profit and loss account above. Consolidated Balance Sheet as at 31 October 2006 Note As at As at As at 31 October 31 October 30 April 2006 2005 2006 Unaudited Audited Audited £'000 £'000 £'000 Fixed assets Equipment 29 25 22 Intangibles 299 - 299 Investments 192 150 192 520 175 513 Current assets Debtors 258 194 290 Cash at bank and in hand 2,961 3,076 2,460 3,219 3,270 2,750 Creditors: amounts falling due within (116) (69) (103) one year Net current assets 3,103 3,201 2,647 Total assets less current liabilities 3,623 3,376 3,160 Capital and reserves Called up share capital 3 93 87 90 Share premium account 4,722 3,906 4,004 Profit and loss account (1,192) (617) (934) 3,623 3,376 3,160 Consolidated Cash Flow Statement for the Six Months to 31 October 2006 Note 6 Months to 6 Months to Year to 31 October 31 October 30 April 2006 2005 2006 Unaudited Audited Audited £'000 £'000 £'000 Cash outflow from operating 4 (297) (527) (950) activities Return from investment and servicing 86 83 141 of finance Capital expenditure (74) (151) (503) Financing 786 39 140 Cash (decrease)/increase in the 501 (556) (1,172) period Opening net debt 2,460 3,632 3,632 Closing net debt 2,961 3,076 2,460 Reconciliation of movements in shareholders' funds £'000 £'000 £'000 Loss for the period (254) (251) (557) New share capital subscribed, net of expenses - 39 - Foreign exchange reserves (4) 8 (3) (258) (204) (560) Opening shareholders' funds (934) (413) (374) Closing shareholders' funds (1,192) (617) (934) Notes to the Interim Report 1. Accounting Policies The interim report has been prepared using accounting policies consistent with those set out in the company's Annual Report and Accounts for the period to 30 April 2006. They have been prepared on a going concern basis. The interim report for the six months to 31 October 2006 was approved by the Board on 4 January 2007. 2. Loss per Share 6 Months to 6 Months to 1 May 2005 31 October 2006 31 October to 30 April 2005 2006 Pence Pence Pence Loss per ordinary share-basic (0.06p) (0.07p) (0.16p) - diluted (0.05p) (0.07p) (0.14p) The loss per ordinary share is based on the Company's loss for the period of £254,000 (30 April 2006 - £557,000; 31 October 2005 - £251,000) and a weighted average number of shares in issue of 463,995,682 (30 April 2006 - 393,851,507; 31 October 2005 - 237,750,000). The potentially dilutive warrants issued were 52,845,682 (30 April 2006 - 43,981,918; 31 October 2005 - Nil). 3. Called up Share Capital In June 2006, the Company issued 47 million new ordinary shares at 7.5p each. 23.5 million Warrants can be exercised at 7.5p per share before end December 2006. 4. Reconciliation of operating loss to net cash outflow from operating activities 6 Months to 6 Months to 1 May 2005 31 October 31 October to 30 April 2006 2005 2006 £'000 £'000 £'000 Operating loss (340) (334) (698) Depreciation 2 1 14 Exchange rate movement on overseas (4) 8 3 assets (Increase)/Decrease in debtors 32 (155) (255) (Decrease)/Increase in creditors 13 (47) (14) Net cash outflow from operating (297) (527) (950) activities 5. Financial information The information for the year ended 30 April 2006 has been extracted from the audited accounts for that period which have been delivered to the Registrar of Companies and received an unqualified audit opinion (and incorporate the information for 31 October 2005). The unaudited results for the six months have been prepared on a basis consistent with the accounting policies disclosed in the Company's 2006 accounts and do not constitute statutory accounts within the meaning of Section 240 of the Companies Act 1985.
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