The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014 ("MAR") which has been incorporated into UK law by the European Union (Withdrawal) Act 2018.  Upon the publication of this announcement via Regulatory Information Service ("RIS"), this inside information is now considered to be in the public domain.

7 November 2022

Great Eastern Energy Corporation Limited

("Great Eastern" or "the Company")

Unaudited Half Year Results for the six months ended 30 September 2022

Great Eastern Energy Corporation Limited (LSE: GEEC), the fully integrated, pioneering Indian Coal Bed Methane ("CBM") Company, is pleased to announce its unaudited half year results for the 6 months ended 30 September 2022.

Abridged Financials for H1 FY 2023:

* MTM (Mark to Market) is on account of the restatement of the foreign currency loans; DTE (Deferred Tax Expense) is on account of difference in depreciation rates used for financial accounts and tax accounts and other expenses like exchange fluctuation / MTM

** Additional depreciation during H1 FY 2023 is $0.99m

*** Per GDR

**** Pricing is based in Indian rupee ("INR")

$ - U.S. Dollar

The Company had appointed S.N. Dhawan & CO LLP ("Firm") as its auditors, a member firm of Mazars, an international audit, tax, and advisory firm. The Firm has informed the Company that it had applied for registration as Third Country Auditors to the Financial Reporting Council ("FRC") in accordance with the laws and paid the registration fee on 3 October 2022.  The Firm is yet to receive the registration certificate from FRC and is hopeful of receiving the same soon.

The full set of the unaudited half year financial statement is available at the following link: https://www.geecl.com/financials.php

The Company is profitable, cash generative, and continues to maintain sufficient liquidity to meet all its financial obligations on time.

As announced on 8 July 2022, while both the 3P and 3C numbers have increased, there has been a reduction in the 1P number which has resulted in a higher depreciation charge as per the accounting standards.

The average gas sales price received remained strong, and the Company continues to be profitable.  Given the current pricing environment and renewals effected after the six months reporting period ending 30 September 2022, the average selling price for the full financial year ending 31 March 2023, and 31 March 2024, is expected to be ~$12.77/mmbtu and ~$16.47/mmbtu respectively. (Pricing is based in INR.  INR:$ exchange rate assumed is as considered in the six months reporting period ending 30 September 2022)

Gas production decreased from an average of 15.86 mmscfd in FY 2022 to an average of 15.58 mmscfd in October 2022, including choked production.  This is due to the natural decline in CBM wells.  To mitigate this decrease, as per the evaluation of DeGolyer & MacNaughton ("D&M"), the Company plans to undertake an efficiency capital expenditure program of ~$20 million in the next financial year.  This is expected to increase gas production from the existing CBM wells.

The Company is further planning to undertake drilling of another 144 CBM wells starting in the next financial year.  Thereafter, subject to government approval, the Company may undertake drilling of another 506 CBM wells as per D&M's evaluation.  The total expected investment of drilling these CBM wells is ~$700 million at current costs, which is expected to be incurred over the next few years.  This is expected to further increase gas production from the Raniganj (South) block.

The Company is exploring various fund raising options, including but not limited to, any form of debt, equity, and/or farm-in, for financing the above-mentioned estimated capital expenditures.

As announced on 8 July 2022, the Shale gas and CBM reserves and resources in the Raniganj (South) block are as follows:

Ø Original gas in place ("OGIP"): High estimate of 10.62 TCF

Ø OGIP: Best estimate of 6.13 TCF

Ø 3P + 3C + 3U of 3,628.19 BCF i.e., 3.63 TCF

Ø Undiscounted value of 3P + 3C + 3U: $29.36 billion

Ø PV 5% value of 3P + 3C + 3U: $17.17 billion

Ø PV 10% value of 3P + 3C + 3U: $10.94 billion

As announced previously, the Company is making plans for undertaking the drilling of the initial Shale core wells and, based on the results obtained, will then progress to undertake a development plan to drill pilot Shale production wells.

Jagdishpur - Haldia & Bokaro - Dhamra pipeline:  The section up to Panagarh was commissioned on 6 February 2021 by GAIL (India) Limited.  Further work for laying the pipeline up to Kolkata is underway and making progress.  The transportation tariff of this pipeline has been fixed at INR 71.08/mmbtu ($0.89/mmbtu) including 12% Goods and Services Tax.

As per publicly available data, the long term delivered LNG price in India in September 2022 was $19.58/mmbtu as compared to $13.41/mmbtu in September 2021 i.e., an increase of ~46%.  Transporting this gas to the eastern region of India, via the above-mentioned pipeline, would entail an additional transportation cost as mentioned above and other costs to customers.  Great Eastern believes the resulting gas sales price ex-pipeline to customers in eastern India will be in sync with its average selling price and, together with the pipeline, will allow Great Eastern to sell additional gas sales volumes to new customers that will be financially attractive.

Prashant Modi, Managing Director & CEO of Great Eastern, said:

"Given the strong set of results coupled with a conducive pricing environment, gives us greater confidence to go ahead with our proposed capital expenditure program.  With the amendment to our Petroleum Mining Lease, enabling us to move forward with our Shale program, and the significant uplift in the resource and reserves, it provides the Company a fantastic growth opportunity. 

With the steps being taken by the government to increase the share of natural gas in India's energy mix along with the growth of the Indian economy, the demand for hydrocarbons, especially natural gas, in India will continue to grow.  This provides a fantastic opportunity to domestic producers like Great Eastern.

On 7 July 2022, we were delighted to announce our inaugural ESG Report.  At Great Eastern, we have found it imperative to establish a channel for communicating and aligning our stakeholders with our values, and the steps we have been taking to combat issues such as, but not limited to, environmental damage, social injustice, and governance."

About the Company

A fully integrated gas production, development, and exploration Company in India. Gas is being produced from the Raniganj (South) block in West Bengal, which covers 210 sq. km with 10.62 TCF of Original gas in place.  The Company's second license is the Mannargudi block in Tamil Nadu, which covers 667 sq. km with 0.98 TCF of Original gas in place.