Burford Capital Regulatory News (BUR)

17 Sep 2007 07:01

Burren Energy PLC17 September 2007 17 September 2007 Burren Energy Plc ("Burren" or "the Group") Interim Results for six months ended 30 June 2007 Burren Energy, an independent FTSE250 oil and gas company, today announces itsinterim results for the period ended 30 June 2007. HIGHLIGHTS Operational : Strong production growth in Turkmenistan fuelled by appraisalsuccess • 11% increase in Group working interest production to 36,800 bopd (H1 2006: 33,300 bopd) • Record gross production levels from Turkmenistan : 17% increase to 21,800 bopd (H1 2006: 18,600 bopd) resulting from successful development drilling • Record production in August of 24,000 bopd compared with 20,800 in January • B-063 continuing to produce at record levels of 2,200 bopd • Reservoir optimisation programme by Eni commenced on M'Boundi • High gas producing wells shut in leading to temporary reduction in production H2 • Scale of water injection programme increased • In the long term programme will lead to more oil being produced • Exploration well Doungou-1 drilling on la Noumbi concession in Congo. • Pre-drill activities continued on Middle East portfolio with seismic programmes in Egypt and Yemen Financial : 25% interim dividend increase reflects strong cash flow and outlook • Net operating cash flow before working capital movements up by 7% to US$179.3 million (H1 2006: US$168.2 million) • Net profit of US$132.8 million (H1 2006: US$140.2 million) down by 5% due to lower oil prices and increased non-cash charges • Cash position at period end of US$54.6 million, after US$154 million acquisition of additional 5.5% stake in M'Boundi field • Interim dividend increased from 4.0p to 5.0p Outlook: Set for higher realised oil prices and active operational programme • H2 production expected to be maintained at H1 levels. • Discount to Brent expected to reduce further • Exploration well on East Kanayis concession, Egypt, to be drilled in November 2007 • Three appraisal wells to B-063 in Turkmenistan • HOEC to drill two exploration wells in Assam during H2 2007 Strategy: Actively pursuing growth opportunities to complement existingportfolio • Targeting opportunities that offer production and reserve growth and create strategic regional alliances • US$500 million loan facility signed to provide support for corporate transactions Atul Gupta, Chief Executive Officer, commented: "We have continued to realise success from our strategy of operating as a lowcost production company in emerging markets combined with exposure to attractiveexploration activities. The increased dividend reflects Burren's strongfinancial position and the Company's confident outlook for the future." "In the second half Burren is set to benefit from higher realised oil prices andthe exploration drilling in Egypt has the potential to add significant reserves.In addition the Company is pursuing new business opportunities with the aim offurther strengthening and expanding our highly profitable production and reservebase." Analysts' Presentation At 09:30 the Company will make an Interim Results presentation to analysts atthe offices of Pelham PR: No 1 Cornhill, London EC3V 3ND Enquiries Burren Energy Tel: 020 7484 1900Atul Gupta, Chief Executive OfficerAndrew Rose, Chief Financial OfficerShona Harvey, Communications Managerwww.burren.co.uk Pelham PR Tel: 020 7743 6676James HendersonAlisdair Haythornthwaitewww.pelhampr.com 2007 Interims Statement CHAIRMAN'S STATEMENT Burren has made good progress in the first half of the year, with productionincreasing by 11% and underlying net operating cash flow (before working capitalmovements) is up by 7%. We enjoyed continued operational success in Turkmenistanand acquired an additional 5.5% share in the M'Boundi field in the Congo. Giventhe excellent operating cashflow and the positive outlook for the business theBoard has decided to increase the interim dividend by 25% to 5.0 pence pershare. Earnings per share were 6% lower at US$94.2 cents. This was caused mainly bytiming differences between production and sales, lower oil prices which weredown by an average of 4% compared to the same period last year, and increasednon-cash charges such as depletion and share scheme accruals. A key element of Burren's strategy continues to be to achieve low-costproduction growth from its existing assets, and to this end our unit operatingcosts of US$3.0 /bbl and net profit of US$20.4/bbl in the first half comparewell in an industry context and have been achieved against a background ofsignificant cost inflation within the industry. In Turkmenistan the production growth over the year to date has been verypleasing, with August production reaching a record of 24,000 bopd compared with20,800 bopd in January. The south flank of the Burun field has produced someexcellent well results, including well B63 which tested at a record 2,200 bopdand our shallow drilling programme continuing to give exceptional returns withaverage production per well from the last seven wells of 600 bopd. We willcontinue with three rigs drilling back-to-back development wells over theremainder of the year. At the M'Boundi field, in which we now own a 37% stake, the new operator, Eni,is in the process of implementing a long-term reservoir management programmewhich we expect to lead to more oil being produced than currently booked. In theshort term these measures will lead to a reduction in field production,principally as wells which produce a disproportionately large volume of gas aretemporarily shut-in. This is necessary not only to conserve reservoir energy butalso for environmental reasons to reduce gas flaring. We expect productiongrowth to resume in 2008. In terms of our exploration portfolio, the Doungou -1 well on La Noumbi, Congois drilling and we are currently mobilising a rig from China to drill on theEast Kanayis concession in Egypt. Our Indian affiliate HOEC is proceeding with adevelopment of the PY-1 gas development and in addition plans to drill twoexploration wells in Assam before the end of the year. Burren's working interest production for the second half of the year is expectedto be constant at 36,000-37,000 bopd. With continuing firm oil prices, Burren isexpected to remain strongly cash generative. We have been developing significant, value adding business opportunities whichwe hope to bring to fruition. Our objective is to further expand both theproduction and reserve profile of the Group. We aim to achieve this, as we havealready demonstrated in Turkmenistan and Congo, through the acquisition andefficient management of development assets within a geographical focus ofemerging markets. Burren has recently signed a new US$500 million loan facility to provide thefunding for such transactions. We look forward to the remainder of the year with confidence. OPERATIONS REVIEW Working interest production increased by 11% to 36,800 bopd vs. 33,300 bopd H12006, with the additional production arising from the increase in our Congointerests being included from the middle of March. Turkmenistan Following the completion of the exploration drilling campaign in February,development drilling resumed in the Burun field with eight new completionsduring H1 2007, more than in the whole of 2006. Gross production averaged 21,800bopd in the period, 17% up on H1 2006 (18,600 bopd), and entitlement productionwas 11,200 bopd vs. 9,900 bopd in H1 2006. New wells on the south flank in particular have continued to boost production:four shallow wells drilled towards the end of the first half added over 3,700bopd to gross production and a deep well completed in July has added 2,200 bopdto take August gross production to a record 24,000 bopd. Both of the newlyacquired deep drilling rigs are working well, and 12 new wells are programmedfor the second half of the year on both the north and the south flanks of theBurun field. Further appraisal drilling on the adjacent Balkan field isscheduled for 2008. Deep water injection re-commenced in August after a temporary suspension andshallow injection continues at 6,300 bwpd. There are plans to add a further twoshallow and three deep injectors by the end of the year. A full development plan for the development of our gas resources has now beensubmitted to the Turkmen Government and discussions are continuing with regardsto project implementation. Congo Congo gross production in the first half was 53,100 bopd, compared with 58,300bopd in H1 2006 and 57,100 bopd for 2006 as a whole. All but 800 bopd came fromthe M'Boundi field. Burren's working interest production in H1 2007, includingthe additional purchased M'Boundi production from mid-March, was 18,400 bopd (H12006 : 18,300 bopd) and entitlement production was 10,200 bopd (H1 2006 : 9,300bopd). The reduced gross production in H1 2007 reflects the emphasis in thedrilling programme on water injection wells, which accounted for six out of 14wells completed in the period. Since taking over as operator, Eni has implemented a programme on the M'Boundifield to shut in wells with high gas production in order to reduce flaring andpreserve reservoir energy. This has resulted in a reduction of M'Boundi oilproduction since mid-year, with August gross production being 44,700 bopd, andthe forecast for the full year production is 47,000 bopd. The water injection project is currently operating at a reduced rate while theoperator upgrades the surface facilities and drills additional water sourcewells. The full implementation of Phase 1 is now anticipated by December 2007and this will bring injection capacity up to at least 40,000 bwpd. It is planned to increase this injection capacity to 100-120,000 bwpd by mid2008 and to 200,000 bwpd thereafter. Further exploration drilling on the Kouilou licence has now been deferred untilthe dry season in mid-2008 in order to allow Eni to complete its review of theprospect inventory and acquire more seismic data. A new 2D seismic programmewill commence in September and cover the Loufika and Kouakouala areas. In the La Noumbi permit (still operated by Maurel & Prom), some 200 kilometresof 2D seismic have been acquired in the northern part of the block to evaluateleads and prospects. In August, well Doungou-1 was spudded in the southern partof the La Noumbi permit and the results are expected later in September. Middle East In Egypt, the land rig which is being shipped from China is expected in countryin October and should be ready to spud the East Kanayis Jurassic well inNovember. Additional prospects have been generated following interpretation ofthe 3D seismic data acquired last year, and these will be ready for drilling inearly 2008. On the North Hurghada Marine block, the 3D seismic programme has been deferredwhile clarification is sought from various government departments on theoperating permits and access over reefs in certain parts of the concession.Prospect generation will proceed using reprocessed 2D seismic with plans fordrilling in mid 2008. In Yemen on Block 6, 2D seismic acquisition will commence in October and theresults are expected to be available to plan for 2008 drilling. On Block 17,the PSA is awaiting government approval and parliamentary ratification. Finally in Oman, Block 50 was relinquished after the partners reviewed theresults of the newly acquired seismic and decided that it was not sufficientlyprospective to proceed to the drilling phase. India Hindustan Oil Exploration Company (HOEC) is proceeding with the development ofthe PY-1 offshore gas field, having signed a gas sales agreement earlier in theyear. In addition HOEC drilled two successful exploration wells in the Cambaybasin and plans to drill two exploration wells on Block AAP-ON-94/1 in Assam, inwhich it has a 40% operated interest, in Q4 2007. HOEC has announced a US$150million rights issue for these purposes in the autumn, in which Burren intendsto participate. FINANCIAL REVIEW Selected Operational and Financial Data H1 2007 H1 2006 +/- % Production (working interest) bopd 36,800 33,300 11% Production (entitlement) bopd 21,400 19,200 12% Entitlement Factor % 58% 58% Sales volume mmbbls 3.94 3.85 2% Operating Profit US$ m 146.1 156.1 (6)% Profit after tax US$ m 132.8 140.2 (5)% Earnings per Share (basic) US cents 94.2 100.0 (6)% Net Operating Cash Flow before changes in working (i) US$ m 179.3 168.2 7% capital Net Cash Flow after Development Expenditure (ii) US$ m 101.8 77.5 (31)% Period-end cash balance US$ m 54.6 215.7 (75)% Average realised price / bbl (iii) US$/bbl 58.3 60.5 (4)% Average sales discount to Brent US$/bbl 4.9 5.3 7% Production cost / bbl (working interest) US$/bbl 3.0 2.5 (23)% Depletion / bbl (entitlement) US$/bbl 11.7 8.8 (33)% (i) After tax payments but excluding movements in working capital (ii) Net Operating Cash Flow before changes in Working Capital, less purchases of property plant and equipment relating to the development of reserves (but before exploration or acquisitions) (iii) Before deduction of 1% royalty withheld from Congo sales revenues Production & Sales Working interest production increased by 11% to 36,800 bopd vs. 33,300 bopd H12006. Entitlement production was 21,400 bopd, up by a similar percentage (H12006 : 19,200 bopd). Sales volumes, however, were only slightly up at 3.9million bbls, since in H1 2006 sales exceeded entitlement production resultingin an overlift position at period-end. The underlift position of 494,000 bblswith which we entered 2007 had reduced to 434,000 bbls at 30 June 2007, andefforts will be made to reduce this further during the rest of the year. The average realised sales price in the period was US$58.3/bbl compared withUS$60.5/bbl in H1 2006 as a result of lower market crude prices generally, andthis offset the small sales volumes increase, resulting in a 1% reduction inrevenues to US$235.9 million. However the discount to Brent continued to improveto US$4.9/bbl vs. US$5.3/bbl in H1 2006 owing to better pricing of our Congocrude. The discount may be expected to narrow further in H2 because of the lowerdiscount of US$6.9/bbl applying to our Turkmen crude from 1 July 2007(previously US$8.0/ bbl). Operating Profit Cost of sales increased by 15% to US$73.8 million (H1 2006 : US$64.3 million).Within cost of sales the depletion charge increased significantly to US$45.3million (H1 2006 US$30.3 million) owing to a combination of higher entitlementproduction and increased unit depletion rates (US$11.7 / bbl vs. US$8.8 / bbl inH1 2006). This increase in unit depletion rates results primarily from upwardsrevisions to future estimated development costs, most of which were effected inlate 2006 and reflected in the results for that year. Excluding costs attributable to Burren's shipping business, and after adjustingfor movements in underlift / overlift in both periods (in H1 2006 cost of saleswas inflated by US$12.3 million because of the period-end overlift, whereas theadjustment for H1 2007 is negligible), production costs/ working interest barrelincreased to US$3.0/bbl from US$2.5/bbl in H1 2006. Administrative expenses increased to US$9.7 million from US$6.0 millionprimarily as a result of increased accruals for employee incentive schemes underIFRS. Excluding incentive scheme accruals underlying administrative expensesincreased from US$3.3 million to US$4.7 million, caused in part by the weakeningof the US dollar against sterling over the past year. US$6.2 million was chargedas pre-licence costs and the write down of our investment in Oman following therelinquishment of our interest in Block 50. Our share of HOEC's results fell tovirtually zero as a result of certain adjustments relating to translation ofIndian GAAP accounts to IFRS. Operating profit as a result declined by 6% to US$146.1 million compared withUS$156.1 million in H1 2006. The H1 2007 figure includes the revenues and costsattributable to the additional Congo interests with effect from mid-March. Theunderlift position at period-end contains significant inherent deferred profitgiven that Burren accounts for underlift at cost rather than market value, withthe effect that recognition of profit is deferred until time of lifting. Net Earnings and Dividend Net interest earned was US$4.2 million (H1 2006 : US$3.1 million). The taxationcharge, at US$17.5 million, was 8% lower than in H1 2006 (US$19.0 million). Net profit as a result declined by 5% to US$132.8 million (H1 2006 : US$140.2million) and earnings per share declined by a similar amount to US94.2 cents (H12006 : US100.0 cents). An increased interim dividend of 5.0 pence (H1 2006 : 4.0 pence) per share hasbeen approved. Cash Flow and Capital Expenditure Net operating cash flow before working capital movements was US$179.3 million,7% higher than in H1 2006 (US$168.2 million). There was a US$39.8 millionincrease in working capital during the period arising mainly from timingdifferences associated with crude oil lifting and trade payables, compared witha US$23.1 reduction in H1 2006. Capital expenditure amounted to US$280.9 million compared with US$101.1 millionin H1 2006. Of this total US$178.5 million represented asset acquisition costs,of which US$149.9 million was the initial instalment for the purchase of theadditional Congo interests and US$23.3 million was the final instalment of thedeferred purchase consideration for Nebit Dag, which had been accrued atyear-end. Development capex was US$80.8 million (H1 2006 : US$90.7 million) andexploration capex was US$21.6 million (H1 2006 : US$10.1 million), some 75% ofwhich was in Congo. US$30.0 million of the total expenditure was accounted foras additions to intangible assets. Net interest receipts were US$5.6 million and US$12.5 million was spent on therepurchase of shares all of which have since been reissued under share incentiveschemes. The resulting net cash outflow in the period was US$147.7 million. Financial Position At 30 June Burren had cash and deposit balances of US$54.6 million, comparedwith US$202.2 million at the start of the year. A US$500 million loan facility,arranged via Calyon, has recently been signed to provide funds for assetacquisitions and new business ventures, on terms significantly finer than theprevious loan facility which it is replacing. Consolidated Income Statement Unaudited Unaudited Audited 6 months to 6 months to Year Ended 30 June 30 June 31 December 2007 2006 2006 NOTES US$'000 US$'000 US$'000 REVENUE 2 235,868 238,970 416,022Cost of sales (73,833) (64,332) (111,405) GROSS PROFIT 162,035 174,638 304,617Administrative expenses (9,746) (5,980) (13,926)Other operating expenses 3 (6,230) (13,365) (19,300)Loss on disposal of subsidiary - (563) (563)Share of results of associates 87 1,363 3,362 OPERATING PROFIT 146,146 156,093 274,190Investment revenue 4,750 3,886 9,722Finance costs (585) (808) (1,456) PROFIT BEFORE TAX 150,311 159,171 282,456Tax 6 (17,543) (19,003) (33,583) PROFIT AFTER TAX 132,768 140,168 248,873 Minority interests 53 - -PROFIT ATTRIBUTABLE TO EQUITY HOLDERS OF 132,821 140,168 248,873PARENT COMPANYDividends declared 7 (28,328) (24,045) (35,689) RETAINED PROFIT FOR THE PERIOD 104,493 116,123 213,184Earnings per shareBasic (US cents) 4 94.23 100.00 177.25Diluted (US cents) 4 92.02 97.36 172.80 Consolidated Statement of Total Recognised Income and Expense Unaudited Unaudited Audited 6 months to 6 months to Year End 30 June 30 June 31 December 2007 2006 2006 US$'000 US$'000 US$'000Exchange differences on translation of foreign operations 161 330 617 Net income recognised directly in equity 161 330 617 Profit for the period 132,821 140,168 248,873 Total recognised income and expense for the period 132,982 140,498 249,490 Consolidated Balance Sheet Unaudited Unaudited Audited 30 June 30 June 31 December 2007 2006 2006 NOTES US$'000 US$'000 US$'000ASSETSNon-current assetsIntangible assets 8 66,397 24,828 44,600Property, plant and equipment 644,941 369,773 448,915Interests in associates 40,335 28,657 40,248 751,673 423,258 533,763 Current assetsInventories 20,152 15,506 14,319Trade and other receivables 85,868 55,807 68,504Cash and cash equivalents 54,632 215,659 202,170 160,652 286,972 284,993Assets held for sale - 17,340 - Total assets 912,325 727,570 818,756 LIABILITIESCurrent liabilitiesTrade and other payables (41,185) (58,644) (68,051)Tax liabilities (10,474) (13,397) (22,215)Dividends payable (28,328) (24,045) - (79,987) (96,086) (90,266)Liabilities directly associated with assets - (7,651) -classified as held for sale Net current assets 80,665 200,575 194,727 Non-current liabilitiesDeferred tax liabilities (46,049) (32,709) (38,289) (46,049) (32,709) (38,289) Total liabilities (126,036) (136,446) (128,555) NET ASSETS 786,289 591,124 690,201 EQUITYShare capital 46,879 46,711 46,745Share premium account 92,420 91,643 91,772Revaluation reserve 23,022 24,864 24,018Other reserves (2,053) (5,726) (4,162)Retained earnings 9 626,072 433,632 531,826 Equity attributable to equity holders of the 786,340 591,124 690,199parent company Minority Interest (51) - 2 TOTAL EQUITY 10 786,289 591,124 690,201 Consolidated Cash Flow Statement Unaudited Unaudited Audited 6 months to 6 months to Year Ended 30 June 30 June 31 December 2007 2006 2006 NOTES US$'000 US$'000 US$'000 OPERATING ACTIVITIESCash flow generated by operations 5 160,704 217,426 350,211Taxation paid (21,249) (26,057) (26,239) NET CASH FROM OPERATING ACTIVITIES 139,455 191,369 323,972 INVESTING ACTIVITIESPurchases of intangible fixed assets (30,025) (14,060) (27,099)Purchases of property, plant and equipment (250,886) (87,068) (183,469)Deposits in respect of exploration 254 (8,144) (3,100)commitmentsAcquisition of interest in associates - - (9,932)Cash received on disposal of subsidiary - 4,461 4,461Interest received 6,165 3,737 8,307Dividends received from associate - - 340 NET CASH USED IN INVESTING ACTIVITIES (274,492) (101,074) (210,492) FINANCING ACTIVITIESInterest paid (62) (176) (179)Arrangement and facility fees (524) (550) (1,195)Interest element of finance lease rentals - (82) (82)Dividends paid - - (35,689)Capital element of finance lease rentals - (44) (44)Purchase of treasury shares (12,466) - -Issue of ordinary share capital 394 1,153 491 NET CASH (USED IN)/ PROVIDED BY FINANCING (12,658) 301 (36,698)ACTIVITIES NET (DECREASE)/ INCREASE IN CASH AND CASH (147,695) 90,596 76,782EQUIVALENTSCASH AND CASH EQUIVALENTS AT BEGINNING OF 202,170 124,781 124,781PERIODEffect of foreign exchange rate changes 157 282 607 CASH AND CASH EQUIVALENTS AT END OF PERIOD 54,632 215,659 202,170 Notes to the Interim ReportFor the six months to 30 June 2007 1. Basis of Preparation The interim financial information in this condensed report is prepared on thebasis of the accounting policies set out in the 2006 annual report and accountsand using accounting policies consistent with IFRS, including IAS 34 'InterimFinancial Reporting'. The interim financial information for the 6 months ended30 June 2007 and 30 June 2006 is unaudited and does not constitute statutoryaccounts as defined in section 240 of the Companies Act 1985. The auditors havecarried out a review of the interim financial information for these periods andtheir report is shown on page 16. The 2006 annual report and accounts, whichreceived an unqualified opinion from the auditors and did not contain astatement under section 237(2) or (3) of the Companies Act 1985, have been filedwith the Registrar of Companies. This interim report was approved by the Board of Directors on 14 September 2007. 2. Segmental Analysis 6 months ended 30 June 2007 WestAnalysis by geographical area Caspian Africa Total US$'000 US$'000 US$'000 Revenue 120,938 114,930 235,868 Segment result 85,371 73,483 158,854Share of results of associates 87Unallocated other operating expenses (4,077)Unallocated administrative expenses (8,718) Operating profit 146,146 6 months ended 30 June 2006 WestAnalysis by geographical area Caspian Africa Total US$'000 US$'000 US$'000 Revenue 119,678 119,292 238,970 Segment result 85,554 81,041 166,595Share of results of associates 1,363Unallocated other operating expenses (7,018)Unallocated administrative expenses (4,847) Operating profit 156,093 12 months ended 31 December 2006 WestAnalysis by geographical area Caspian Africa Total US$'000 US$'000 US$'000 Revenue 216,558 199,464 416,022 Segment result 151,374 137,822 289,196Share of results of associates 3,362Unallocated other operating expenses (7,986)Unallocated administrative expenses (10,382) Operating profit 274,190 3. Other Operating Expenses 6 months 6 months Year ended to to 30 June 30 June 31 December 2007 2006 2006 US$'000 US$'000 US$'000 Write-off pre-licence expenditure 2,153 7,365 8,765Impairment of exploration expenditure 4,077 6,000 6,018Supplementary insurance charge - - 4,517 6,230 13,365 19,300 Write off of pre-licence expenditure relates predominantly to Former SovietUnion, the impairment of exploration expenditure relates to Oman (2006: Egypt)and the supplementary insurance charge arose in 2006, in respect of a dispute inTurkmenistan. 4. Earnings per Ordinary Share 6 months to 6 months to Year endedEarnings per ordinary share 30 June 30 June 31 December 2007 2006 2006 US$'000 US$'000 US$'000 Earnings for the purposes of basic earnings per share (being profitattributable to equity holders of theparent) 132,821 140,168 248,873 Number of shares Number Number Number Weighted average number of ordinary shares for the purposes of basicearnings per share 140,958,222 140,168,651 140,408,108Effect of dilutive potential ordinaryshares:Share options 1,752,998 2,367,858 2,220,262Long Term Incentive Plan - 165,554 81,745Performance Share Plan 680,860 415,804 478,761Annual Profit Share Scheme 949,856 851,034 835,759 Diluted number of shares 144,341,936 143,968,901 144,024,635 Basic earnings per share (US cents) 94.23 100.00 177.25Diluted earnings per share (US 92.02 97.36 172.80cents) 5. Reconciliation of Operating Profit to Cash Flow Generated by Operations 6 months to 6 months to Year ended 30 June 30 June 31 December 2007 2006 2006 US$'000 US$'000 US$'000 Operating profit 146,146 156,093 274,190Adjustments for:Depreciation of property, plant and equipment 45,358 30,307 69,831Impairment of exploration expenditure 4,077 6,000 6,018Non-cash charge for incentive schemes 5,008 2,697 5,306Share of associate's profit (87) (1,363) (3,362)Loss on disposal of subsidiary - 563 563 Operating cash flows before movements in working 200,502 194,297 352,546capitalIncrease in inventory (5,833) (2,839) (1,652)(Increase) /decrease in trade and other receivables (19,308) 16,619 143(Decrease)/increase in trade and other payables (14,657) 9,349 (826)Other non cash flowCash flow generated by operations 160,704 217,426 350,211 6. Taxation 6 months to 6 months to Year ended 30 June 30 June 31 December 2007 2006 2006 US$'000 US$'000 US$'000Current tax: UK corporation tax - - 747 Foreign tax 9,784 13,238 21,491 9,784 13,238 22,238Deferred tax:Origination and reversal of temporary differences 7,759 5,765 11,345 17,543 19,003 33,583 The Group's tax liability in Congo is settled out of its share of oil under theterms of the relevant PSAs and is not reflected in the tax charge for the year. 7. Dividends A US$28.3 million dividend, being 10.0 pence per share (6 months ended 30 June2006: US$24.0 million, 9.5 pence per share), was declared on 19 March 2007 inrelation to the results of the year ended 31 December 2006. Since 30 June 2007the Directors have approved the payment of an interim dividend of 5.0 pence pershare (2006: 4.0 pence per share), which will be paid on 18 October 2007 toshareholders on the register at the close of business on 28 September 2007. 8. Intangible Assets Intangible assets consist of exploration and evaluation expenditure within threeregions, West Africa, the Middle East and the Former Soviet Union. 9. Changes in Retained Earnings The movement in retained earnings during the period is primarily due to theretained profit together with the purchase and subsequent issuance of treasuryshares. 10. Changes in Equity 6 months to 6 months to Year ended 30 June 30 June 31 December 2007 2006 2006 US$'000 US$'000 US$'000 At 1 January 690,201 472,368 472,368Retained profit for the period 104,493 116,123 213,184Shares issued in the period 136 1,154 491Share based payments 3,559 1,149 3,539Purchase of treasury shares (12,466) - -Issue of treasury shares 258 - -Minority interest (53) - 2Exchange adjustments 161 330 617 At end of period 786,289 591,124 690,201 During the period 780,200 treasury shares were purchased for a consideration ofUS$12,466,000. These shares were issued to employees to satisfy exercisedoptions held under the Group's incentive schemes. 11. Purchase of Additional Interest in Congo In March 2007 Burren entered into an agreement to acquire an additional 5.5%interest in the M'Boundi field and 2% in the Kouilou exploration licence fromENI Congo SA for a purchase consideration of US$153,941,000, subject to anadjustment for working capital and movements since the effective date of 1January 2007. The transaction was subject to several conditions precedent,including Congolese parliamentary approval. Parliamentary approval was receivedin May 2007 and the transaction was finalised, though the purchase priceadjustment is still under negotiation. On 29 May 2007 95% of the base purchase consideration was paid, along withinterest accruing from the effective date. The balance of the purchaseconsideration along with any post-completion adjustments will be settledsubsequently. INDEPENDENT REVIEW REPORT TO BURREN ENERGY PLC Introduction We have been instructed by the Company to review the consolidated financialinformation for the six months ended 30 June 2007 which comprises theconsolidated income statement, consolidated statement of total recognised incomeand expense, consolidated balance sheet, consolidated cash flow statement andrelated notes 1 to 11. We have read the other information contained in theinterim report and considered whether it contains any apparent misstatements ormaterial inconsistencies with the financial information. This report is made solely to the Company in accordance with Bulletin 1999/4issued by the Auditing Practices Board. Our work has been undertaken so that wemight state to the Company those matters we are required to state to them in anindependent review report and for no other purpose. To the fullest extentpermitted by law, we do not accept or assume responsibility to anyone other thanthe Company, for our review work, for this report, or for the conclusions wehave formed. Directors' responsibilities The interim report, including the financial information contained therein, isthe responsibility of, and has been approved by, the directors. The directorsare responsible for preparing the interim report in accordance with the ListingRules of the Financial Services Authority and the requirements of IAS 34 whichrequire that the accounting policies and presentation applied to the interimfigures are consistent with those applied in preparing the preceding annualaccounts except where any changes, and the reasons for them, are disclosed. Review work performed We conducted our review in accordance with the guidance contained in Bulletin1999/4 issued by the Auditing Practices Board for use in the United Kingdom. Areview consists principally of making enquiries of Group management and applyinganalytical procedures to the financial information and underlying financial dataand, based thereon, assessing whether the accounting policies and presentationhave been consistently applied unless otherwise disclosed. A review excludesaudit procedures such as tests of controls and verification of assets,liabilities and transactions. It is substantially less in scope than an auditperformed in accordance with International Standards on Auditing (UK andIreland) and therefore provides a lower level of assurance than an audit.Accordingly, we do not express an audit opinion on the financial information. Review conclusion On the basis of our review we are not aware of any material modifications thatshould be made to the financial information as presented for the six monthsended 30 June 2007. Deloitte & Touche LLPChartered AccountantsLondon14 September 2007 Glossary bbl barrel of oilbopd barrels of oil per dayCongo The Republic of Congo (Brazzaville)PSA or PSC Production Sharing Agreement or Production Sharing Contract This information is provided by RNS The company news service from the London Stock Exchange