UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
(Mark One)
[ X ] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF SECURITIES EXCHANGE ACT
OF 1934
For the quarterly period ended: MARCH 31, 2004
[ ] 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
--------------------------------
(Exact name of Registrant as Specified in its Charter)
Delaware 84-1379164
------------------------------ ----------------------------------
(State or other jurisdiction of (IRS Employer Identification Number)
incorporation of organization)
2480 North Tolemac Way, Prescott, Arizona 86305
-----------------------------------------------
(Address of principal executive offices)
Issuer's Telephone Number: (928) 778 1450 Internet Website: www.gascorp.net
NOT APPLICABLE
--------------
(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, 2004.
Transitional Small Business Disclosure Format (Check one): Yes [ ] No [ x ]
INDEX
AUSTRALIAN OIL & GAS CORPORATION
For the Quarterly Period Ended: March 31, 2004
Part 1. FINANCIAL INFORMATION
Item 1. Financial Statements (Unaudited)
Consolidated Balance Sheet as at March 31, 2004 (Unaudited)
Consolidated Statement of Operations for the three months ended
March 31, 2004 (Unaudited)
Consolidated Statement of Cash Flows for the three months ended
March 31, 2004 (Unaudited)
Notes to Financial Statements (Unaudited)
Item 2. Management's Discussion and Analysis or Plan of Operation
Item 3. Controls and Procedures
Part 11. OTHER INFORMATION
Item 5. Other Information
Item 6. Exhibits and Reports on Form 8-K
Signatures
Australian Oil & Gas Corporation
(a development stage enterprise)
CONSOLIDATED BALANCE SHEET
March 31, 2004 (Unaudited)
ASSETS
(Dollar amounts in thousands) As at 3/31/04 As at 12/31/03
(Audited)
Current assets:
Cash and cash equivalents 1 2
---- ----
Total Current Assets 1 2
---- ----
Total Assets 1 2
==== ====
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable 144 111
---- ----
Total Current Liabilities 144 111
Stockholders' Equity
Common stock, $0.001 par value;75,000,000 shares
authorized 27,300,550 shares issued and outstanding 20 20
Capital in excess of par value 55 55
Deficit accumulated during the development stage (218) (184)
---- ----
Total Stockholders' Equity (Deficit) (143) (109)
Total Liabilities and Stockholders' Equity (Deficit) 1 2
==== ====
The accompanying notes are an integral part of these
consolidated financial statements.
Australian Oil & Gas Corporation
(a development stage enterprise)
CONSOLIDATED STATEMENT OF OPERATIONS
for the three months ended March 31, 2004 (Unaudited)
(Dollar amounts in thousands)
For the three Cumulative period
months ended from August 6, 2003
March 31,2004 (Date of Inception)
to March 31,2004
Revenues: Nil Nil
Costs and Expenses:
General and administrative 34 79
Merger and reorganisation - 139
---------- ----------
34 218
---------- ----------
Net Loss (34) (218)
========== ==========
Basic Loss per Common Share $ (*) $ (*)
========== ==========
Number of Common Shares Used in Calculation 27,300,550 27,300,550
========== ==========
*Less than $.01 per share
The accompanying notes are an integral part of these
consolidated financial statements.
Australian Oil & Gas Corporation
(a development stage enterprise)
CONSOLIDATED STATEMENT OF CASH FLOWS for the three months
ended March 31, 2004 (Unaudited)
(Dollar amounts in thousands)
For the three Cumulative period
months ended from August 6, 2003
March 31,2004 (Date Of Inception)
to March 31,2004
Cash flows from operating activities:
Net loss (34) (218)
Adjustments to reconcile net loss to net cash
used in operating activities:
Change in assets and liabilities:
Increase (decrease) in accounts payable 33 144
------- -------
Total adjustments 33 144
------- -------
Net cash used in operating activities (1) (74)
Cash flows from financing activities:
Proceeds from the sale of common stock - net - 75
------- -------
Net cash provided by financing activities - 75
------- -------
Increase (decrease) in cash (1) 1
Cash and cash equivalents at beginning of period 2 0
------- -------
Cash and cash equivalents at end of period 1 1
======= =======
Supplemental disclosure of non-cash financing activities.
Great Missenden Holdings Pty Ltd charged:-
Administration Fees 19,665 39,165
Interest 1,754 1,754
Disbursements - 49,470
The accompanying notes are an integral part of these
consolidated financial statements.
Australian Oil & Gas Corporation
(a development stage enterprise)
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
The accompanying interim financial statements of Australian Oil & Gas
Corporation are unaudited. However, in the opinion of management, the interim
data includes all adjustments, consisting of only normal recurring adjustments,
necessary for a fair presentation of the results for the interim period. The
results of operations for the period ended March 31, 2004 are not necessarily
indicative of the operating results for the entire year. The interim financial
statements should be read in conjunction with our Annual Report on Form 10-KSB
for the year ended December 31, 2003.
Note 1: Organization
Australian Oil & Gas Corporation (the Company) was incorporated on August 6,
2003, and began operations on August 11, 2003 pursuant to the terms of a Plan of
Reorganization (`Plan') of Synergy Technologies Corporation ("Synergy") and is
considered to be a crude petroleum and natural gas company in the exploratory
stage and a development stage company as defined by SFAS No. 7, and since
inception, has been engaged in the assessment of oil and gas exploration
properties.
The authorized capital stock of the Australian Oil & Gas Corporation consists of
75,000,000 shares of common stock, $0.001 par value.
Note 2: Summary of Significant Accounting Policies
The Company has adopted Fresh Start Accounting.
All dollar amounts used herein refer to U.S. dollars unless otherwise indicated.
These statements are prepared using Generally Accepted Accounting Principles of
the Unites States of America.
All significant transactions between the parent and consolidated affiliates have
been eliminated.
These statements include all adjustments (consisting of normal recurring
accruals) considered necessary by management to present a fair statement of the
results of operations, financial position and cash flows.
Basis of presentation
The financial statements have been prepared on a going concern basis which
contemplates the realization of assets and liquidation of liabilities in the
ordinary course of business. As shown in the accompanying financial statements,
the Company has incurred losses and at March 31, 2004 had minimal cash. As a
development stage enterprise, the Company relies on infusions of cash through
the advances from Great Missenden Holdings Pty Ltd and issuance of equity
capital. As a result, substantial doubt exists about the Company's ability to
continue to fund future operations using its existing resources.
Future plans for additional funding of activities include the sale of the
Company's common stock and further advances from Great Missenden Holdings Pty
Ltd.
Use of estimates
The preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the amounts reported in the financial
statements and footnotes thereto. Actual results could differ from those
estimates.
Undeveloped mineral interests and oil and gas properties
The Company will utilise the "successful efforts" method of accounting for
undeveloped oil and gas properties. Capitalized costs will be charged to
operations at the time the Company determines that no economic reserves exist.
Costs of carrying and retaining undeveloped properties are to be charged to
expense when incurred. Proceeds from the sale of undeveloped properties are to
treated as a recovery of cost. Proceeds in excess of the capitalised cost
realised in the sale of any such properties, if any, are to be recognized as
gain to the extent of the excess.
Income taxes
The Company will provide for income taxes utilizing the liability approach under
which deferred income taxes are provided based upon enacted tax laws and rates
applicable to the periods in which the taxes became payable.
Cash equivalents
For purposes of the statements of cash flows, the Company will consider all
highly liquid debt instruments purchased with a maturity of three months or less
to be cash equivalents.
Impairment of long-lived assets
The Company will evaluate the potential impairment of long-lived assets in
accordance with Statement of Financial Accounting Standards No. 144, Accounting
for the Impairment or Disposal of Long-Lived Assets. The Company will annually
review the amount of recorded long-lived assets for impairment. If the carrying
amount of a long-lived asset is not recoverable form its undiscounted cash
flows, the Company will recognize an impairment loss in such period.
Concentrations of credit risk
Financial instruments, which potentially subject the Company to concentrations
of credit risk, consist principally of cash and cash equivalents. The Company
will place its cash with high quality financial institutions.
Note 3: Income Taxes
The Company does not anticipate that any of the past net operating loss carry
forwards for tax purposes attributable to Synergy will be able to be used to
offset future taxable income.
Note 4: Investments
The Company has two wholly owned subsidiaries; Gascorp, Inc and Nations LNG,
Inc, both incorporated in Delaware. Gascorp, Inc has made application for a
petroleum exploration permit by way of competitive work program tender with the
responsible authority for regulation of the Australian offshore petroleum
exploration activities with respect to AC02-1, an area within the Territory of
Ashmore & Cartier Islands, an Australian offshore territory administered by the
Northern Territory of Australia ("NT") on behalf of the Australian government.
Gascorp holds a 20% interest in the application. Since the end of the quarter,
the Company has been offered the permit area ACO2-1. See Part II Item 5.
Note 5: Related Party Transactions
Mr. E Geoffrey Albers is a director and shareholder of Great Missenden Holdings
Pty Ltd. For the period ended March 31, 2004, Great Missenden Holdings charged
the Company administration fees of $19,665, granted a loan to the Company of
$15,000 and charged interest of $1,754. At March 31,2004 the amount of $125,265
remained payable to Great Missenden Holdings Pty Ltd on three months notice,
bearing interest at 7% per annum. The Company also has the use of premises in
Australia at 25 Floor, 500 Collins Street, Melbourne, Victoria. The office space
is taken on a nonexclusive basis, with no rent payable, but the usage of the
premises is included in the charges Great Missenden Holdings Pty Ltd makes in
respect to the administration of the Company. With regard to the application for
exploration permit AC02-1, Mr. E. Geoffrey Albers is a director and shareholder
in the joint applicants; namely Natural Gas Corporation Pty Ltd and Auralandia
N.L.
Note 6: Current Liabilities
At March 31, 2004 the Company recorded a liability to Great Missenden Holdings
Pty Ltd of $125,265 as set out in Note 6 Related Party Transaction.
Other liabilities of $18,500 were recorded relating to the administration of the
Company.
Note 7: Common Stock
o The Company has 27,300,550 shares of Common Stock on Issue.
Note 8: Commitments and Contingencies
Insurance
The Company is without insurance pertaining to various potential risks with
respect to its properties, including general liability, because it is presently
not able to obtain insurance for such risks at rates and on terms, which it
considers reasonable. The financial position of the Company in future periods
could be adversely affected if uninsured losses were to be incurred.
Item 2. Management's Discussion and Analysis or Plan of Operation
Forward-looking statements
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
Registrant intends, expects, projects, believes or anticipates will or may occur
in the future, including, without limitation: statements regarding the
Registrant's business strategy, plans and objectives and statements expressing
beliefs and expectations regarding the ability of the Registrant to successfully
raise the additional capital necessary to meet its obligations, the ability of
the Registrant to secure the leases necessary to facilitate anticipated drilling
activities and the ability of the Registrant 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
-----------------
General
Australian Oil & Gas Corporation is an independent energy company focused
on exploration and development of oil and natural gas reserves. Our core
business is directed at the acquisition of interests in oil and gas prospects in
the offshore areas in Australia's territorial waters. Since August 2003, when
current management began operating the company, we have not conducted any
substantive business operations. Management has been seeking to identify
opportunities in oil and gas exploration in Australia, but has not yet concluded
its investigation or made any decision as to the company's future operations
other than as disclosed elsewhere herein. Accordingly, we have no results of
operations to report.
We rely on the considerable experience in the oil and gas industry of our
President, Mr. Geoffrey Albers, to identify and conduct initial analyses of
properties in which we may acquire an interest. We devote essentially all of our
resources to the identification of high quality oil and gas properties and seek
to keep our overhead at a minimum level through the retention of carefully
selected consultants, contractors and service companies. We use proven
technologies to evaluate prospects before acquiring a working interest.
Generally, we expect to invest in projects at different levels of participation,
principally as a minority owner, so that daily operating responsibility will
rest with experienced, high quality partners and contractors.
In November 2003, we were granted an option, exercisable until March 31
2004, to acquire a 30% interest in three petroleum exploration permits in the
Browse Basin, offshore Western Australia. Management has decided to let the
option lapse. However, we are still interested in acquiring an interest in the
three permits. Management is currently negotiating with the Joint Venture
partners to acquire a suitable interest for the Company.
We, together with certain other affiliated joint venturers, made
application to the Australian authorities for a petroleum exploration permit
with respect to AC02-1, a gazetted area within the offshore Territory of Ashmore
and Cartier Islands, an Australian offshore territory. We hold a 20% interest in
the application. Since the end of the reporting period, the Designated Authority
has advised us that our application for ACO2-1 has been successful. See Part II
Item 5.
Item 3. Controls and procedures
As required by Rule 13a-15 under the Securities Exchange Act of 1934 (the
"Exchange Act"), we carried out an evaluation of the effectiveness of the design
and operation of our disclosure controls and procedures as of March 31, 2004.
This evaluation was carried out under the supervision and with the participation
of our Chief Executive. Based upon that evaluation, our Chief Executive and
Financial Officer concluded that our disclosure controls and procedures are
effective in timely alerting management to material information relating to us
required to be included in our periodic SEC filings. There have been no
significant changes in our internal controls subsequent to the date we carried
out our evaluation.
Disclosure controls and procedures are controls and other procedures that are
designed to ensure that information required to be disclosed in our reports
filed or submitted under the Exchange Act is recorded, processed, summarized and
reported within the time periods specified in the Securities and Exchange
Commission's rules and forms. Disclosure controls and procedures include,
without limitation, controls and procedures designed to ensure that information
required to be disclosed in our reports filed under the Exchange Act is
accumulated and communicated to management, including our Chief Executive, to
allow timely decisions regarding required disclosure.
Part 11. OTHER INFORMATION
Item 5. Other Information
On April 6, 2004, our wholly-owned subsidiary GASCORP,INC (Gascorp) was offered
a petroleum exploration permit ACO2-1, by the designated authority. ACO2-1 is an
area within the Territory of Ashmore & Cartier Islands, an Australian offshore
territory administered by the Northern Territory of Australia on behalf of the
Australian Government. 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. Management is currently finalizing the Joint
Venture Operating Agreement before formally accepting the offer for the
exploration permit. We have until June 14 to formally accept the offer.
Providing the offer is accepted, the area ACO2-1 will then be granted, and a new
title will be issued. Release area ACO2-1 is located in the Vulcan Sub-basin. It
comprises five graticular blocks, totaling approximately 400 square kilometers
(98,800 acres).
Item 6. Exhibits and Reports on Form 8-K
List of Exhibits
31.1 Certification pursuant to Section 302 of the Sarbanes-Oxley Act of
2002.
32.1 Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant
to Section 906 of the Sarbanes-Oxley Act of 2002.
Reports on Form 8-K
No reports on Form 8-K were filed during the period covered by this report.
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
-----------------------------
E. Geoffrey Albers,
Chief Executive Officer and
Chief Financial Officer
May 6, 2004