KUWAIT ENERGY plc GROUP
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 December 2011
F-128
1.
INCORPORATION AND ACTIVITIES
Kuwait Energy plc (“Company”) is a company incorporated on 12 September 2011 in accordance with the
Commercial Companies Law in the Bailiwick of Jersey.
The Company and its subsidiaries (together referred to as “the Group”) have been established with the objective
of exploration for production and commercialisation of crude oil and natural gas.
The Company’s registered address is Queensway House, Hilgrove Street, St Helier, Jersey, JE1 1ES.
GENERAL INFORMATION AND RESTRUCTURING
The Company is incorporated in Jersey, and is the new ultimate parent company of the Kuwait Energy Group
(“Kuwait Energy”) and owner of all the assets and liabilities previously held directly by Kuwait Energy KSSC,
following a restructuring of the ownership interests in Kuwait Energy KSSC in December 2011 (the
“Restructuring”). During 2011, Kuwait Energy plc acquired all of Kuwait Energy KSSC’s material assets and
subsidiaries in consideration for the issue to Kuwait Energy KSSC of 317,500,000 new shares of Kuwait
Energy plc. The share capital of Kuwait Energy KSSC was subsequently reduced to 2.5% of the existing share
capital and 90% of the shares in Kuwait Energy plc were transferred to Kuwait Energy KSSC’s shareholders on
a pro-rata basis, with the remaining 10% being held by Kuwait Energy KSSC. Immediately prior to the capital
reduction, Kuwait Energy KSSC transferred 285,750,000 ordinary shares of £1 in Kuwait Energy plc to Kuwait
Energy KSSC shareholders, pro-rata to their shareholding in Kuwait Energy KSSC.
After the Restructuring, each Kuwait Energy KSSC shareholder held 25 Kuwait Energy KSSC and 225 Kuwait
Energy plc shares for every 1000 Kuwait Energy KSSC shares held immediately prior to the Restructuring.
Although this consolidated financial information has been released in the name of the parent, Kuwait Energy
plc, it represents in-substance, continuation of the existing Group, headed by Kuwait Energy plc. For
accounting purposes it represents a reorganisation of entities under common control. As such, this business
combination was outside the scope of IFRS 3 “Business Combinations” and for the period prior to the
Restructuring the results have therefore been prepared using the principles of merger accounting. Under this
method:
• the consolidated assets and liabilities of the previous ultimate parent, Kuwait Energy KSSC, were recognised
and measured at the pre-restructuring carrying amounts, without restatement to fair value;
• the results for the year ended 31 December 2010 and the period from 1 January 2011 to the date of the
Restructuring are those of Kuwait Energy KSSC;
• comparative numbers presented in the consolidated financial statements are those reported in the consolidated
financial statements of Kuwait Energy KSSC, for the year ended 31 December 2010, except for the presentation
of the share capital and other reserves, which have been restated to reflect the change in the nominal value of
the ordinary shares resulting from the Restructuring as if Kuwait Energy plc had been the parent company
during such periods; and
• the difference between the historical carrying amounts of net assets transferred and consideration received has
been recognised as a merger reserve.
These consolidated financial statements were approved for issue by the Board of Directors of the Parent
Company on 4 April 2012 and are subject to the approval of the Annual General Meeting of the shareholders.
32.
ADOPTION OF REVISED STANDARDS
In the current year, the following new and revised Standards and Interpretations have been adopted and have
affected the amounts reported in these financial statements.
Standards not affecting the reported results or the financial position
The following new and revised Standards and Interpretations have been adopted in the current year. Their
adoption has not had any significant impact on the amounts reported in these financial statements but may impact
the accounting for future transactions and arrangements.
