81
Purchase of property, plant and
equipment .......................................
52,448
57,301
83,712
23,253
25,656
Total capital expenditures
...........
84,125
92,549
162,070
63,183
33,962
The Group’s capital expenditures have historically comprised the costs of technical services and studies, seismic
acquisition, development and exploratory drilling and testing of wells on the Group’s assets, as well as the purchase of
vehicles and other facilities and equipment.
The following table sets out data on the Group’s wells drilled over the periods indicated:
Year ended 31 December
Three
months
ended 31
March
Type of well
2011
2012
2013
2014
Development wells
(1)
...................................................
49
49
50
17
Appraisal wells
(2)
.........................................................
0
0
0
2
Exploration wells
(3)
......................................................
8
7
6
1
(1)
A development well is a well drilled within a development lease area where associated reserves are booked for an oil and/or gas reservoir,
to the depth of a stratigraphic horizon known to be productive. A development well may be a producing well or a shut in well.
(2)
An appraisal well is a well drilled to assess the characteristics (such as flow rate, size, quality) of a hydrocarbon discovery or reservoir
discovered by an exploration well.
(3)
An exploration well is a well drilled: (i) to find and produce oil or gas from an accumulation previously considered as an undiscovered; or
(ii) to find a new reservoir in a known field, i.e., a field previously producing oil and gas from another reservoir (the incremental drilled is
considered to be within the exploration criteria if the well targets producing reservoirs).
Capital expenditures decreased by $29.2 million, or 46.2%, from $63.2 million in the three months ended 31 March 2013
to $34.0 million in the three months ended 31 March 2014. This decrease was primarily attributable to lower capital
expenditure in Block 9 in Iraq, the cessation of capital expenditure in Latvia in 2014, as well as the suspension of
collection of 3D seismic data in Block 82 in Yemen due to security reasons. The decrease was partly offset by an $11.4
million capital expenditure in Siba for gas project development and a $7.4 million capital expenditure in Abu Sennan for
construction of oil production and processing stations.
Capital expenditures increased by $69.5 million, or 75.1%, from $92.5 million in 2012 to $162.1 million in 2013. This
increase was primarily attributable to the payment in 2013 of $102.4 million remaining due on the purchase of Block 5,
$27.3 million expenditure in respect of Block 9 in Iraq in 2013 and a $20.5 million capital expenditure for the drilling of
an offshore exploration well in Latvia in 2013. The increase was partly offset by the relinquishment of Block 74 in
Yemen in 2012, which had accounted for a $4.4 million capital expenditure in 2012.
Capital expenditures increased by $8.4 million, or 10.0%, from $84.1 million in 2011 to $92.5 million in 2012. This
increase was primarily attributable to $15.0 million in capital expenditure for development wells in the Siba and
Mansuriya fields in Iraq, advance payment of $5.0 million for purchase of certain parts and equipment for the
exploration well in Latvia, $4.0 million in capital expenditure for the drilling of a well in Ukraine, and the loss of $3.7
million in cash provided as a letter of guarantee in Yemen upon the Group’s relinquishment of Block 74. Partly
offsetting the increase in capital expenditures were lower levels of drilling and facility capital spending in Egypt, Russia,
Yemen and Pakistan in 2012 as compared to 2011.
Contractual obligations and commercial commitments
The following table sets forth the Group’s outstanding contractual obligations and commitments as at 31 March 2014, as
adjusted to give effect to the use of proceeds from the Notes offered hereby.
($ thousands)
Within
one year
One to
three
years
Three to
five years
After five
years
Total
Notes offered hereby
(1)
...........................................
-
-
-
250,000
250,000
Convertible Loans
(2)
...............................................
8,000
16,000
111,197
-
135,197
Committed exploration capital expenditures
(3)
66,423
48,254
-
-
114,677
