UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB/A
(Mark One)
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF SECURITIES EXCHANGE ACT OF
1934
For the quarterly period ended: March 31, 2005
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT
For the transition period from _________ to _________
Commission file number 000-26721
AUSTRALIAN OIL & GAS CORPORATION
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(Exact name of Registrant as Specified in its Charter)
Delaware 84-1379164
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(State or other jurisdiction (IRS Employer Identification Number)
of incorporation of organization)
2480 North Tolemac Way, Prescott, Arizona 86305
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(Address of principal executive offices)
Issuer's Telephone Number: (928) 778 1450 Internet Website: www.ausoil.com
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NOT APPLICABLE
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(Former name, former address and former fiscal year,
if changed since last report)
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. Yes [ x ] No [ ]
State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date:
27,300,550 shares of common stock, $0.001 par value, as of MARCH 31, 2005.
Transitional Small Business Disclosure Format (Check one): Yes [ ] No [X]
Explanatory Note:
This amendment to Form 10-QSB for the period ended March 31, 2005 is being filed
to correct a typographical error in the Management paragraph of Item 2.
Management's Discussion and Analysis or Plan or Operation.
Item 2. Management's Discussion and Analysis or Plan of Operation
Forward-looking statements
References in this report to "the Company", "we", "us", or "our" are intended to
refer to Australian Oil & Gas Corporation. This quarterly report contains
certain statements that may be deemed forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended (Securities
Act), and Section 21E of the United Stated Securities Exchange Act of 1934, as
amended (Exchange Act). Readers of this quarterly report are cautioned that such
forward-looking statements are not guarantees of future performance and that
actual results, developments and business decisions may differ from those
envisaged by such forward-looking statements.
All statements, other than statements of historical facts, so included in
this quarterly report that address activities, events or developments that the
Company intends, expects, projects, believes or anticipates will or may occur in
the future, including, without limitation: statements regarding our business
strategy, plans and objectives and statements expressing beliefs and
expectations regarding the ability of the Company to successfully raise the
additional capital necessary to meet our obligations, the ability of the Company
to secure the leases necessary to facilitate anticipated drilling activities and
the ability of the Company to attract additional working interest owners to
participate in the exploration and development of oil and gas reserves, are
forward-looking statements within the meaning of the Act. These forward-looking
statements are and will be based on management's then-current views and
assumptions regarding future events.
Plan of Operation
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General
Australian Oil & Gas Corporation is an independent energy company focused
on the acquisition, exploration and development of oil and natural gas
resources. Our core business is directed at the acquisition of interests in oil
and gas prospects in the offshore areas of Australia's territorial waters. We
rely on the considerable experience in the oil and gas industry of our
President, Mr. E. Geoffrey Albers, and our consultants to identify and conduct
initial analyses of properties in which we may acquire an interest.
STRATEGY
We devote essentially all of our resources to the identification of high
quality oil and gas properties and seek to keep our capital outlays and
overheads at a minimum level. We retain selected consultants, contractors and
service companies. We use proven technologies to evaluate prospects before
acquiring a working interest. We expect to invest in projects at different
levels of participation. We plan to maintain as high a percentage of
participation as can be prudently managed. We will focus on areas considered to
have significant near term potential for oil or medium term potential for gas,
and which can be farmed out and/or developed in conjunction with other industry
players. It is our strategy to minimize our financial outlay requirements,
wherever possible, through promoted farm-out transactions to provide maximum
leverage for shareholders at minimal cost.
Since August 2003, when current management began operating the Company, we
have not conducted any revenue generating business operations. Accordingly, we
have no results of such operations to report. However, we continue to actively
pursue our long term strategy of acquiring interests in oil and gas projects in
the offshore areas of Australia.
BROWSE BASIN REGION
In June 2004, we entered into a preliminary, non binding agreement to
acquire 100% of the outstanding shares of Alpha Oil & Natural Gas Pty Ltd
(Alpha), a company incorporated in Australia. The acquisition of Alpha is being
made to cost-effectively acquire a 20% interest in the permits of the Browse
Joint Venture, being permits WA-332-P, WA-333-P, WA-341-P and WA-342-P
("Permits"). The shareholders of Alpha shall, upon conclusion of formal
documentation and satisfaction of all conditions, be entitled to receive
2,000,002 shares of common stock of AOGC as consideration for Alpha.
The Permits of the Browse Joint Venture are contiguous and are located in
the offshore Browse Basin, a part of the North West Shelf of Australia. They
cover a total area of 11,080 sqkms (2,726,760 acres).
The Browse Basin region, off the coast of Western Australia, has a 40-year
history of exploration. It is an established petroleum sub-province and it forms
a part of the extensive series of continental margin sedimentary basins that,
together, comprise the North West Shelf hydrocarbon province of Australia. The
Browse Basin has been host to a series of major gas, gas condensate and oil
discoveries which began with the 1971 discovery at Scott Reef No.1. The first
discovery at Scott Reef-1 was followed, over the years, by major discoveries at
Brewster, Brecknock, and Brecknock South. In a later phase of exploration, oil
discoveries were made at Gwydion and Cornea. The latest major discoveries in the
Browse Basin have been made at Dinichthys, Titanichthys and Gorganichthys (the
Ichthys Gas/Condensate Fields). The latter, a giant 556.02 MMBL condensate and
10.7 TCF gas field is approximately 50 kilometers to the west of the Permits.
The Permits lie up-dip of these major central Browse Basin gas, and
gas/condensate discoveries. For the most part they lie on trend with the Crux
Field and with basin margin oil and gas accumulations at Gwydion and the Cornea.
The permits are presently lightly explored. There is one well on the boundary of
WA-332-P (Prudhoe-1), one well in WA-333-P (Rob Roy-1), two wells-Heywood-1 and
Buccaneer-1 in WA-341-P, and a total of fourteen wells in WA-342-P, mostly
associated with the undeveloped Cornea oil and gas accumulation. In the first
three year term of the Permits, the Browse Joint Venture has committed to obtain
available open file reports and basic 2D and 3D seismic data acquired by earlier
efforts of previous explorers. This includes approximately 1,100 sq kms of high
quality 3D seismic known as the Cornea 3D survey which is held by the Browse
Joint Venture. The data sets will be integrated and subjected to extensive
interpretational effort before the acquisition and processing of a further 1900
kilometres of new 2D seismic data to infill the existing grid of data, with lead
specific coverage. Should the Browse Joint Venture so decide, it can elect to
enter a second three year permit term and in which it has indicated it will
drill one well in each permit. Preliminary geological and geophysical evaluation
of the Permits has commenced.
VULCAN SUB-BASIN REGION
Our wholly owned subsidiary, Gascorp, Inc (Gascorp), with other affiliated
joint venturers, was granted by the Australian Government, a petroleum
exploration permit, AC/P33, for an initial 6-year term. Gascorp holds a 20%
interest in the permit, in joint venture with its affiliates; Natural Gas
Corporation Pty Ltd (40%) and Auralandia N.L. (40%), the designated Operator.
AC/P33 is part of a sector of the eastern margin of the Vulcan Sub-basin; one of
a number of proven petroliferous sub-basins which together comprise the North
West Shelf hydrocarbon province of Australia. AC/P33 includes the undeveloped
Oliver oil and gas accumulation. AC/P33 comprises five graticular blocks,
totaling approximately 400 square kilometers (98,800 acres). In the first three
years of the initial 6-year term of permit AC/P33, the joint venture
participants plan to obtain a range of pertinent existing reports and open file
seismic data, and with this data, to map, interpret and revise analyses and
concepts which presently exist for the area. The joint venture has committed to
the enhancement of existing seismic data around the Oliver and the Oliver NE
feature, and will examine various techniques for their potential use as direct
hydrocarbon indicators. In the third year, the joint venture plans to acquire 80
square kilometers (19,760 acres) of new enhanced parameter 3D seismic survey. It
is intended that the survey will be conducted over the Oliver and Oliver NE
features. Should the joint venture so decide, it can elect to enter the second
three years of the initial permit and drill one exploration well and perform
further interpretational work. Geological and geophysical evaluation of the
permit has commenced.
BONAPARTE GULF REGION
In September 2004, we entered into a preliminary, non binding agreement to
acquire all of the outstanding shares of Nations Natural Gas Pty Ltd (Nations),
with the exception of 100,000 shares held by Alpha Oil & Gas Pty Ltd (Alpha),
which is intended to become a subsidiary of the Company. The acquisition of
Nations is being made to cost-effectively acquire a 30% interest in the permits
of the National Gas Consortium, being permits NT/P62, NT/P63, NT/P64, and NT/P65
("Permits"). The shareholders of Nations shall, upon conclusion of formal
documentation and satisfaction of all conditions, be entitled to receive
2,100,001 shares of common stock of AOGC as consideration for Nations.
The Permits of the National Gas Consortium are located in the Australian
eastern Timor Sea region of the Bonaparte Basin, offshore Northern Territory,
and cover a total area of approximately 14,875 square kilometers. The Timor Sea
covers a huge area over a million square kilometers, underlain by sedimentary
basins with potential for new hydrocarbon discoveries. The region has a long
history of oil discovery dating back to the Jabiru-1 discovery in 1983, which
alerted the (Australian) domestic and international petroleum industries to the
significant oil potential of the region. Since that time there have been
numerous oil and wet gas discoveries in the northern Bonaparte Basin, which
hosts the Laminaria, Corallina and Bayu-Undan fields, and the giant gas fields
of Greater Sunrise and Evans Shoal.
The Bonaparte Gulf is a major emerging oil and gas province, with a
developing emphasis in gas processing for the export market. Discoveries made
over the past few years are expected to lead to the area providing substantial
gas production and revenue, through value-added gas projects covering a wide
spectrum of gas to liquids processes and technologies.
In the first three year term of the Permits, the National Gas Consortium
has committed to reprocess 750 kms of 2D seismic data and shoot 500 kms of new
2D seismic survey within each permit. Preliminary geological and geophysical
evaluation of the Permits has commenced.
PERMITTING
It should be noted that, provided all work commitments are carried out,
Australian petroleum exploration permits may be renewed for two further 5-year
terms, upon relinquishment of 50% of the area of a permit at the end of the
first 6-year term, and again at the end of the second 5-year permit term. Any
Retention Lease or Production License is excluded from the calculation of the
area to be relinquished. Permits therefore, have a potential 16-year life,
subject to these requirements.
MANAGEMENT
The Company relies upon its Chairman and President who also holds the
position of Chief Executive Officer and Chief Financial Officer, Mr. E Geoffrey
Albers, to manage the Company's operations and to identify and acquire interests
in oil and gas prospects. The Company has entered into an agreement with Mr.
Albers to secure his services on a part-time basis for a 3-year period, with a
commencement date effective from January 1, 2005. As the Company's cash
resources are limited, the board has agreed to remunerate Mr. Albers by issuing
common stock in lieu of cash payments. Specifically, during the fourth quarter
of 2005, the Company will issue 2,500,000 shares of Common Stock to Mr. Albers
for his services in relation to the period from January 1, 2005 to December 31,
2005 (the financial statements for the quarter have accrued $53,000 representing
a pro-rata amount of this compensation). A further 2,000,000 shares of Common
Stock will be issued to him for his services for the period from January 1, 2006
to December 31, 2006 and a further 1,500,000 shares of Common Stock will be
issued to him for his services for the period from January 1, 2007 to December
31, 2007.
FUNDING
As a development stage enterprise, the Company has relied on infusions of
cash through the advances of Great Missenden Holdings Pty Ltd. The Company has
accepted advances and in the future anticipates that it will accept further
advances to enable it to meet its expenditure requirements in developing its
portfolio of oil and gas interests. Effective from April 1, 2005, the Company
will issue to Great Missenden Holdings Pty Ltd December 31, 2007 convertible
notes with an interest coupon of 10% per annum, convertible into shares of
Common Stock at any time on or before December 31, 2007 on the basis of 12,500
shares of Common Stock for every $1,000.00 convertible note. As of March 31,
2005, an aggregate amount of $211,607 remained outstanding to Great Missenden
Holdings Pty Ltd. This amount will be met by the issue of 212 of the aforesaid
convertible notes of $1,000.00 each. When the Company requires further funds for
its programs, then it is the Company's intention that the additional funds would
be raised in a manner deemed most expedient by the Board of Directors at the
time, taking into account budgets, share market conditions and the interest of
industry in co-participation in the Company's programs. When additional funds
for exploration are required, it is the Company's plan that they could be raised
by any one or a combination of the following manners: stock placements, pro-rata
issue to stockholders, and/or a further issue of stock to the public. Should
these methods not be considered to be viable, or in the best interests of
stockholders, then it would be the Company's intention to meet its obligations
by either partial sale of the Company's interests or farm out, the latter course
of action being part of the Company's overall strategy. Should funds be required
for appraisal or development purposes the Company would, in addition, look to
project loan finance.
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
AUSTRALIAN OIL & GAS CORPORATION
By: /s/ E. Geoffrey Albers
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E. Geoffrey Albers,
Chief Executive Officer and
Chief Financial Officer
18th May, 2005