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KUWAIT ENERGY PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the six months ended 30 June 2016
47
30.
RELATED PARTY TRANSACTIONS
Related parties comprise major shareholders, directors and executive officers of the Group, their families and companies
of which they are the principal owners. Balances and transactions between the Company and its subsidiaries, which are
related parties, have been eliminated on consolidation and are not disclosed in this note.
The related party transactions and balances included in the Group’s consolidated financial statements are as follows:
a) Compensation of key management personnel:
Key management personnel are considered to be the Board of Directors of the Company.
The remuneration of key management personnel during the period was as follows:
Six months ended 30 June
Year ended
31 December
2016
2015
2015
Audited
Unaudited
Audited
US$ 000’s
US$ 000’s
US$ 000’s
Salaries and other short-term benefits
752
799
1,599
Consultancy fees paid to non-executive director
-
24
24
Post-employment benefits
15
15
30
767
838
1,653
b) Agreement to purchase shares
The Deputy CEO of the Group has entered into an agreement with a third party on behalf of the Group to purchase a
specified number of shares of the Company held by that third party. Depending on the outcome of certain future events,
and unless otherwise agreed, the Group may be required to lend the Deputy CEO the purchase price of the shares,
approximately US$ 6.3 million (31 December 2015: US$ 7.1 million), until such time as the Deputy CEO is able to sell
those shares and repay the loan to the Company.
During the period ended 30 June 2016 and 31 December 2015, under the arrangement described above, the Deputy
CEO was required to purchase 403,225 and 806,451 ordinary shares of the Company at a price of KWD 0.620 per share
(totalling US$ 0.8 million and US$ 1.6 million respectively). The Company lent the Deputy CEO the funds to complete
this transaction until such time as the Deputy CEO is able to sell those shares and repay the loan to the Company. The
Company may (subject to shareholder approval) purchase the shares from the Deputy CEO and hold them as treasury
shares, with the purchase price being used to repay the loan.
31.
SUBSEQUENT EVENT
Subsequent to the period end, the Group has received a letter from EGPC informing the Group that the EGPC board has
approved the EGPC executive committee recommendation for EGPC’s acquisition of a 20% paying (15% revenue)
interest in one of the Group’s key oil & gas fields, and requesting finalisation of the related farm-out agreement (with
EGPC) and taking the necessary action to complete the transaction. This farm-out agreement, which will require signing
by the Group and EGPC, is also subject to a pre-emption process once finalised, will materially reduce the Group’s
contractual payment commitments during 2016 and 2017.