Directors’ Report Stage one and two of the Canadian River...

Directors’ Report
Stage one and two of the Canadian River project are to be completed on a turnkey basis by the operator. This enables
the Company to accurately account for cash outlays prior to production and does not expose the Company to any cost
overruns or the unlikely event of any engineering issues arising during the drilling process.
Highlights of the Canadian River project are as follows;
• First well has been drilled and successfully producing. Delecta Limited announced to the ASX on 16 February
2015, that the first well (Wise1-25) had exceeded expectations and was flowing naturally at a rate of 85 BOEPD
after 14 days of production from the viola formation (secondary target) on a 27/64 choke.
• First revenue from Oil and Gas sales are expected early March 2015.
• 80% working interest in the first well with a 58% net revenue interest.
• Option to access 64 square miles (around the first well leases, 425 square acres) of 3D seismic that will provide
additional prospects and drill targets.
• Acquisition includes all infrastructure such as gas transmission lines, separation tanks, electricity cables to well
head and pumping equipment.
• A 4 well drilling program is planned as the second stage of the project with an agreed turnkey cost of $4,875,000
USD.
• Partnering with highly experienced operator in Oklahoma.
• Experienced and very knowledgeable Oil and Gas professional residing in Tulsa, Oklahoma to become a Director
of the Company on completion of the acquisition.
Exploration activities on the Paynes Find Gold project during the half year were restricted to minimum amounts to
maintain the landholdings due to the difficulty with raising funds in a continuing depressed capital market for gold
exploration companies.
Corporate
After completing an extensive review of cash outlays and all ongoing exploration and administrative commitments, the
Company was recapitalised via a rights issue to all shareholders on an equal basis. The rights issue prospectus was
lodged with ASIC on 30 July 2014 and provided existing shareholders with the right to take up 5 additional shares for
every 2 shares held at an issue price of $0.001. The rights issue closed on 25 August 2014 with a total raised of
$312,650 before issue costs. This represented a take-up of 31% and 312,650,280 shares were issued. The Directors
placed a portion of the rights issue shortfall on 28 November 2014 to raise additional capital of $195,226 (195,226,220
shares at $0.001).
The funds were used to repay the debt provided by the Company’s substantial shareholder, Delecta Limited, due
diligence costs and working capital.
To fund the acquisition of the Canadian River Oil and Gas project, the Company lodged a prospectus with ASIC on 27
February 2015 to raise a minimum of $7,000,000 and a maximum of $8,000,000, with the issue of shares at a price of 10
cents.
The Directors have resolved to continue the practice of impairing the full value of the exploration expenditure as at 31
December 2014 associated with the Paynes Find Gold project. A review of the project has been completed and the​

Directors are seeking parties to joint venture the properties or make an offer for outright purchase