Fortbridge Media Release

Clontarf Energy [AIM:CLON] - Final Results for the Year Ended 31 December 2013

Clontarf Energy, the oil and gas exploration company focused on Ghana and Peru, today announces its results for the year ending 31 December 2013.

For further information please visit or contact:

Clontarf Energy plc
John Teeling, Chairman +353 (0) 1 833 2833
David Horgan, Director
James Finn, Director

Nominated Adviser and Joint Broker
Shore Capital
Pascal Keane/Toby Gibbs, Corporate Finance +44 (0)20 7408 4090
Jerry Keen, Corporate Broking

Public Relations
Blythe Weigh Communication +44 (0)20 7138 3204
Tim Blythe +44 (0) 7816 924 626
Halimah Hussain +44 (0) 7725 978 141
Camilla Horsfall +44 (0) 7871 841 793

Pembroke Communications
Natalie Tennyson +353 (0) 1 649 6486
Alan Tyrrell +353 (0) 1 649 6486

 
Statement Accompanying the Final Results

Clontarf Energy is going through a difficult time. The market for resource shares has been very challenging for some time, we have problems with our projects and our share price has suffered. Yet in the past year we have made significant progress. We settled a contentious court case in Texas, we farmed out our Peruvian blocks for a royalty on future production and we obtained multi-million dollar insurance bonds for our Ghanaian licence. The bad market for exploration shares has meant, however, that even small selling resulted in major share price falls. The actions by the Ghanaian Government to grant a licence to a US company over part of what we believe to be covered in our signed Petroleum Agreement, on Block Tano 2A, exacerbated the share price decline. We believe that we have substantial rights in Ghana, a belief bolstered by the decision of the High Court in Ghana granting an injunction. Our advice is that no further lawful action can take place by any of the parties
put on notice until the issue is resolved. The Company intends to enforce its rights in relation to its Ghanaian licence. The Directors also believe there is value in Peru where our partners are intent on building power plants to supply rapidly growing demand. They need gas for the stations. We believe our block has potential. The Company�s Bolivian assets remain in limbo due to the uncertainty over title due to the passing of a Nationalisation decree on May 1st 2006.

Clontarf Energy was formed from some of the assets of Pan Andean Resources plc. which was sold in 2010. The buyer did not want certain assets. These were, a licence in Ghana, interests in Bolivia, as well as ongoing litigation against the Company in Texas. In the year of listing, 2011, two onshore hydrocarbon exploration blocks 183 and 188 in Peru were added.

The expectations of the board were that the Ghanaian licence would be ratified and exploration would begin and that partners would join us to explore the Peruvian blocks. Significant sums were spent in Ghana, US$2 million, and in Peru, US$1 million plus.

Unfortunately the process of obtaining ratification for the Company�s Ghanaian licence has been far slower than envisaged. Exploration success in the adjacent ground attracted interest in the block, Tano 2A. It appears that the government of Ghana believed that better terms could be obtained from new investors. For the past 3 years, Clontarf and our partner, Petrel (30% interest), have met each requirement raised by the Ghanaian National Oil Corporation (GNPC). On March 26th 2014 the Ghanaian Government, without notice, announced they had awarded a licence to a US company, part of which overlapped 529 sq km of our Tano 2A block. Despite every effort on our part, neither the GNPC nor the State would engage with Clontarf, so we were forced to obtain a High Court injunction in Accra. Despite the injunction, the agreement was ratified and announced in May 2014. Clontarf is actively pursuing court relief in Ghana.

The two Peruvian blocks proved difficult to farm out despite high oil prices and supposed international oil company interest in Peru. A succession of farm out discussions did not result in a farm out agreement. The Company undertook a work programme which identified good prospects, particularly on Block 183. Finally an agreement was reached with a private group interested in power generation from gas. They were particularly keen on Block 183 because of its closeness to market; adjacent discoveries, identified leads and an earlier discovery on the block. Clontarf accepted a royalty interest on both blocks subject to a maximum of $10 million payment per block. While maintaining Block 183 in good standing Pogel, the Peruvian group, sought a time extension on work commitments on Block 188. The Peruvian authorities refused the extension so the block was relinquished by Pogel.

Our Bolivian interests have been written down to zero value. It is impossible to prove title since a nationalisation decree was passed in 2006. We have a 30% interest in a small producing oil/gas field in Monteagudo. Two multinationals, Repsol and Petrobras, own the balance. Each of these companies have other large oil/gas interests in Bolivia which they want to maintain so they continue to invest in an environment where the State has nationalised without compensation. Likewise with our 10% interest in the El Dorado gas field. The remaining 90% was taken over by YPFB, the State oil company. They have continued to invest and cash called Clontarf. With no security of title Clontarf could not invest. Clontarf declared force majeure on the contract. For the past two years Clontarf has tried to farm out the Bolivian interests. Discussions have taken place but an agreement was never finalised. Clontarf inherited a Texan court case where the Clontarf Group was sued by Hunt Oil for p
ayment related to removing closed down wells in the shallow waters offshore Texas. The case, which related to activities in 2007, was settled in 2013 for a nominal sum, but costs were substantial. The costs were met by Clontarf directors loaning money to the Company. These loans will be converted into shares in the near future.

Where does that leave Clontarf?
In an uncertain place but not without hope. There is near term potential in Peru and we hope to get a deal on our Bolivian interests. The strategy on the Ghanaian interests is simple: pursue the Government of Ghana and the companies signing the licence over what we believe is part of our concession. This is not ideal and something we avoided for four years. But the die is now cast and we will be resolute. It is always better to talk than to litigate so we actively seek to engage with the various parties. Some discussions have taken place in this regard.

While following our existing interests we are active in seeking new ventures, new management and new directors. We have examined and discarded a number of options but a couple of proposals remain live. Manouchehr Takin has resigned from the board. We wish him well. He has been a great help in the last three years. David Horgan has agreed to step aside for the time being to focus on bringing the Ghanaian dispute to a successful resolution, but he will remain a director. John Teeling, Executive Chairman, will manage the day to day operations.

Sourcing additional capital remains a key focus for Clontarf Energy. The Company relies on the support of the Directors and its lenders to continue as a going concern. As previously mentioned the directors will convert all sums due to them into equity in the near future. It is also expected that the South American holders of US$968,000 in loans to the Company will also convert these loans into equity in Clontarf in due course. This would leave the company with a stronger balance sheet. The Directors are confident that new funds will be found to maintain the company in good standing.

Investing in junior natural resource companies is high risk even in good times. The very poor market of the past four years has contributed to the difficulties for Clontarf but cannot be blamed for the problems in Bolivia, Peru and Ghana. We, as directors, must take whatever actions are necessary to protect your investment, to secure your assets and to put the company back on a growth trajectory.

John Teeling
Chairman

28 May 2014

______________________________________________________________________