R
|
QUARTERLY
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE
ACT OF 1934
|
£
|
TRANSITION
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE
ACT OF 1934
|
DELAWARE
|
06-0842255
|
(State
or other jurisdiction of incorporation or organization)
|
(I.R.S.
Employer Identification No.)
|
10
Columbus Boulevard, Hartford, Connecticut
|
06106
|
(Address
of principal executive offices)
|
(Zip
Code)
|
PAGE
|
|
PART
I - FINANCIAL INFORMATION
|
|
ITEM
1 Condensed financial statements
(unaudited)
|
3
|
3
|
|
4
|
|
5
|
|
6
|
|
9
|
|
17
|
|
18
|
|
PART
II - OTHER INFORMATION
|
|
19
|
|
19
|
|
20
|
|
21
|
|
22
|
|
22
|
|
23
|
MARCH
31,
2007
|
JUNE
30,
2006
|
||||||
|
(UNAUDITED |
(NOTE)
|
|
||||
ASSETS
|
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
|
Cash
and cash equivalents
|
|
$
|
24,546,322
|
|
$
|
21,882,882
|
|
Accounts
receivable-trade
|
|
|
4,805,014
|
|
|
4,809,051
|
|
Accounts
receivable-working interest partners
|
|
|
—
|
|
|
413,786
|
|
Marketable
securities
|
|
|
2,229,032
|
|
|
539,675
|
|
Inventories
|
|
|
753,390
|
|
|
734,887
|
|
Income
tax receivable
|
|
|
900,871
|
|
|
—
|
|
Other
assets
|
|
|
383,165
|
|
|
317,496
|
|
Total
current assets
|
|
|
33,617,794
|
|
|
28,697,777
|
|
Deferred
income taxes
|
|
|
—
|
|
|
1,129,719
|
|
Marketable
securities
|
|
|
1,749,814
|
|
|
—
|
|
Property
and equipment:
|
|
|
|
|
|
|
|
Oil
and gas properties (successful efforts method)
|
|
|
104,001,908
|
|
|
87,831,709
|
|
Land,
buildings and equipment
|
|
|
2,709,242
|
|
|
2,448,790
|
|
Field
equipment
|
|
|
873,662
|
|
|
789,921
|
|
|
|
|
107,584,812
|
|
|
91,070,420
|
|
Less
accumulated depletion, depreciation and amortization
|
|
|
(77,163,705
|
)
|
|
(63,287,726
|
)
|
Net
property and equipment
|
|
|
30,421,107
|
|
|
27,782,694
|
|
Intangible
exploration rights
|
|
|
5,323,347
|
|
|
5,323,347
|
|
Goodwill
|
|
|
5,124,062
|
|
|
5,646,747
|
|
Total
assets
|
|
$
|
76,236,124
|
|
$
|
68,580,284
|
|
LIABILITIES
AND STOCKHOLDERS’ EQUITY
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
|
Accounts
payable
|
|
$
|
1,755,254
|
|
$
|
1,856,515
|
|
Accounts
payable-working interest partners
|
|
|
133,890
|
|
|
—
|
|
Accrued
liabilities
|
|
|
1,257,892
|
|
|
1,919,739
|
|
Deferred
income taxes
|
|
|
37,029
|
|
|
—
|
|
Income
taxes payable
|
|
|
—
|
|
|
101,746
|
|
Total
current liabilities
|
|
|
3,184,065
|
|
|
3,878,000
|
|
Long
term liabilities:
|
|
|
|
|
|
|
|
Deferred
income taxes
|
|
|
1,638,213
|
|
|
1,435,583
|
|
Asset
retirement obligations
|
|
|
8,842,446
|
|
|
7,147,261
|
|
Total
long term liabilities
|
|
|
10,480,659
|
|
|
8,582,844
|
|
Contingencies
(Note 9)
|
|
|
—
|
|
|
—
|
|
Stockholders’
equity:
|
|
|
|
|
|
|
|
Common
stock, par value $.01 per share:
|
|
|
|
|
|
|
|
Authorized
200,000,000 shares:
|
|
|
|
|
|
|
|
Outstanding
41,500,325 and 41,500,138 shares
|
|
|
415,001
|
|
|
415,001
|
|
Capital
in excess of par value
|
|
|
73,153,002
|
|
|
73,145,577
|
|
Accumulated
deficit
|
|
|
(13,104,532
|
)
|
|
(14,412,688
|
)
|
Accumulated
other comprehensive income (loss)
|
|
|
2,107,929
|
|
|
(3,028,450
|
)
|
Total
stockholders’ equity
|
|
|
62,571,400
|
|
|
56,119,440
|
|
Total
liabilities and stockholders’ equity
|
|
$
|
76,236,124
|
$
|
68,580,284
|
|
|
THREE
MONTHS
ENDED
|
NINE
MONTHS ENDED
MARCH
31,
|
|||||||||||
|
2007
|
2006
|
2007
|
2006
|
|||||||||
REVENUES:
|
|||||||||||||
Oil
sales
|
$
|
2,305,562
|
$
|
3,462,059
|
$
|
8,458,469
|
$
|
8,101,231
|
|||||
Gas
sales
|
3,879,437
|
3,382,087
|
11,773,787
|
10,315,315
|
|||||||||
Other
production related revenues
|
663,624
|
514,272
|
1,853,616
|
1,495,570
|
|||||||||
Total
revenues
|
6,848,623
|
7,358,418
|
22,085,872
|
19,912,116
|
|||||||||
COSTS
AND EXPENSES:
|
|||||||||||||
Production
costs
|
1,535,250
|
2,061,517
|
5,132,656
|
6,220,500
|
|||||||||
Exploration
and dry hole costs
|
1,568,280
|
358,577
|
4,541,543
|
2,516,535
|
|||||||||
Salaries
and employee benefits
|
341,105
|
291,570
|
1,051,207
|
972,610
|
|||||||||
Depletion,
depreciation and amortization
|
2,267,722
|
1,485,903
|
7,032,541
|
4,388,047
|
|||||||||
Auditing,
accounting and legal services
|
114,106
|
84,383
|
438,115
|
299,972
|
|||||||||
Accretion
expense
|
136,883
|
107,114
|
403,062
|
325,830
|
|||||||||
Loss
on asset retirement obligation settlement
|
—
|
444,566
|
—
|
444,566
|
|||||||||
Shareholder
communications
|
114,320
|
238,865
|
350,210
|
376,395
|
|||||||||
(Gain)
loss on sale of
field equipment
|
(7,772
|
)
|
34,186
|
(7,966
|
)
|
(115,581
|
)
|
||||||
Other
administrative expenses
|
638,308
|
247,670
|
1,806,083
|
1,965,339
|
|||||||||
Total
operating costs and expenses
|
6,708,202
|
5,354,351
|
20,747,451
|
17,394,213
|
|||||||||
Operating
income
|
140,421
|
2,004,067
|
1,338,421
|
2,517,903
|
|||||||||
Interest
income
|
437,780
|
290,097
|
1,208,693
|
951,323
|
|||||||||
Income
before income taxes and minority interests
|
578,201
|
2,294,164
|
2,547,114
|
3,469,226
|
|||||||||
Income
tax provision
|
(292,274
|
)
|
(716,936
|
)
|
(1,238,958
|
)
|
(1,332,193
|
)
|
|||||
Income
before minority interests
|
285,927
|
1,577,228
|
1,308,156
|
2,137,033
|
|||||||||
Minority
interests
|
—
|
(877,049
|
)
|
—
|
(1,691,093
|
)
|
|||||||
NET
INCOME
|
285,927
|
700,179
|
1,308,156
|
445,940
|
|||||||||
Average
number of shares outstanding
|
|||||||||||||
Basic
|
41,500,325
|
25,783,243
|
41,500,325
|
25,783,243
|
|||||||||
Diluted
|
41,500,325
|
25,847,735
|
41,500,325
|
25,895,336
|
|||||||||
NET
INCOME PER SHARE (BASIC AND DILUTED)
|
$
|
0.01
|
$
|
0.03
|
$
|
0.03
|
$
|
0.02
|
NINE
MONTHS ENDED
MARCH
31, |
|||||||
|
2007
|
|
2006
|
||||
OPERATING
ACTIVITIES:
|
|||||||
Net
income
|
$
|
1,308,156
|
$
|
445,940
|
|||
Adjustments
to reconcile net income to net cash provided by operating
activities:
|
|||||||
Gain
from sale of field equipment
|
(7,966
|
) |
(115,581
|
)
|
|||
Depletion,
depreciation and amortization
|
7,032,541
|
4,388,047
|
|||||
Accretion
|
403,062
|
325,830
|
|||||
Deferred
income taxes
|
1,489,402
|
(482,993
|
)
|
||||
Minority
interests
|
-
|
1,691,093
|
|||||
Exploration
and dry hole costs
|
4,175,072
|
2,252,497
|
|||||
Stock
option expense
|
7,425
|
369,256
|
|||||
Increase
(decrease) in operating assets and liabilities:
|
|||||||
Accounts
receivable
|
481,149
|
(1,351,474
|
)
|
||||
Other
assets
|
(65,669
|
)
|
(57,145
|
)
|
|||
Inventories
|
60,385
|
(235,562
|
)
|
||||
Accounts
payable and accrued liabilities
|
(773,378
|
)
|
(572,476
|
)
|
|||
Income
taxes payable
|
(950,714
|
)
|
(84,016
|
)
|
|||
Net
cash provided by operating activities
|
13,159,465
|
6,573,416
|
|||||
INVESTING
ACTIVITIES:
|
|||||||
Proceeds
from sale of field equipment
|
7,966
|
115,581
|
|||||
Additions
to property and equipment
|
(5,712,509
|
)
|
(5,034,318
|
)
|
|||
Oil
and gas exploration activities
|
(4,175,072
|
)
|
(2,252,497
|
)
|
|||
Marketable
securities matured
|
1,322,270
|
4,652,969
|
|||||
Marketable
securities purchased
|
(4,761,442
|
)
|
(2,367,707
|
)
|
|||
Deferred
acquisition costs
|
-
|
(1,246,679
|
)
|
||||
Net
cash used in investing activities
|
(13,318,787
|
)
|
(6,132,651
|
)
|
|||
FINANCING
ACTIVITIES:
|
|||||||
Dividends
to MPAL minority shareholders
|
-
|
(765,641
|
)
|
||||
Net
cash used in financing activities
|
-
|
(765,641
|
)
|
||||
Effect
of exchange rate changes on cash and cash equivalents
|
2,822,762
|
(1,404,439
|
)
|
||||
Net
increase/(decrease) in cash and cash equivalents
|
2,663,440
|
(1,729,315
|
)
|
||||
Cash
and cash equivalents at beginning of period
|
21,882,882
|
21,733,375
|
|||||
CASH
AND CASH EQUIVALENTS AT END OF PERIOD
|
$
|
24,546,322
|
$
|
20,004,060
|
|||
Cash
Payments:
|
|||||||
Income
Taxes
|
987,946
|
1,887,874
|
|||||
Supplemental
Schedule of Noncash Investing and Financing Activities:
|
|||||||
Revision
to estimate of asset retirement obligations
|
$
|
224,044
|
$
|
445,940
|
|||
Asset
retirement obligation liabilities incurred
|
304,896
|
--
|
|||||
Increase/(decrease)
in construction payables
|
277,481
|
(637,677
|
)
|
Options
Outstanding
|
Expiration
Dates
|
|
Number
of
Shares
|
Exercise
Prices($)
|
|
Fair
Value
at
Grant
Date
|
|||||||
June
30, 2004
|
595,000
|
(1.28
weighted average price
|
)
|
||||||||||
Granted
|
Jul.
2014
|
30,000
|
1.45
|
$
|
43,500
|
||||||||
Expired
|
(595,000
|
)
|
1.28
|
||||||||||
June
30, 2005
|
30,000
|
1.45
|
|||||||||||
Granted
|
Nov.
2015
|
400,000
|
1.60
|
$
|
640,000
|
||||||||
March
31, 2007
|
430,000
|
(1.59
weighted average price)
|
EXPIRATION
DATES
|
TOTAL
|
VESTED
|
EXERCISE
PRICES
($)
|
|
|||||||||
Granted
fiscal year 2004
|
Jul.
2014
|
30,000
|
20,000
|
1.45
|
|||||||||
Granted
fiscal year 2006
|
Nov.
2015
|
400,000
|
400,000
|
1.60
|
|
THREE MONTHS ENDED
MARCH
31,
|
NINE
MONTHS ENDED
MARCH
31,
|
ACCUMULATED
OTHER
COMPREHENSIVE
(INCOME)LOSS
|
|||||||||||||
|
2007
|
2006
|
2007
|
2006
|
||||||||||||
Balance
at June 30, 2006
|
$
|
(3,028,450
|
)
|
|||||||||||||
Net
income
|
$
|
285,927
|
$
|
700,179
|
$
|
1,308,156
|
$
|
445,940
|
||||||||
Foreign
currency translation adjustments
|
1,349,791
|
(631,855
|
)
|
5,136,379
|
(1,846,045
|
)
|
5,136,379
|
|||||||||
Total
comprehensive income (loss)
|
$
|
1,635,718
|
$
|
68,324
|
$
|
6,444,535
|
$
|
(1,400,105
|
)
|
|||||||
Balance
at March 31,
2007
|
$
|
2,107,929
|
THREE MONTHS ENDED
MARCH
31,
|
NINE
MONTHS ENDED
MARCH
31,
|
||||||||||||
|
2007
|
2006
|
2007
|
|
2006
|
||||||||
Revenues:
|
|||||||||||||
MPC
|
$
|
—
|
$
|
—
|
$
|
2
|
$
|
51
|
|||||
MPAL
|
6,848
|
7,358
|
22,084
|
19,861
|
|||||||||
Total
consolidated revenues
|
$
|
6,848
|
$
|
7,358
|
$
|
22,086
|
$
|
19,912
|
|||||
Net
(loss) income:
|
|||||||||||||
MPC
(1)
|
$
|
(375
|
)
|
$
|
(341
|
)
|
$
|
(1,230
|
)
|
(1,519
|
)
|
||
MPAL
|
661
|
1,041
|
2,538
|
1,965
|
|||||||||
Consolidated
net income
|
$
|
286
|
$
|
700
|
$
|
1,308
|
446
|
|
NINE MONTHS ENDED
MARCH
31, 2007
|
YEAR ENDED
JUNE
30, 2006
|
|||||
Assets:
|
|||||||
MPC(2)
|
67,003
|
62,248
|
|||||
MPAL
|
65,671
|
61,811
|
|||||
Equity
elimination
|
(56,438)
|
|
(55,479)
|
|
|||
Total
consolidated assets
|
76,236
|
68,580
|
Balance
at July 1, 2006
|
$
|
7,147,261
|
||
Liabilities
incurred
|
304,896
|
|||
Liabilities
settled
|
—
|
|||
Accretion
expense
|
403,062
|
|||
Revisions
to estimate
|
224,044
|
|||
Exchange
effect
|
763,183
|
|||
Balance
at March 31, 2007
|
$
|
8,842,446
|
PAYMENTS
DUE BY PERIOD
|
||||||||||||||||
CONTRACTUAL
OBLIGATIONS
|
TOTAL
|
LESS THAN
1
YEAR
|
1-3
YEARS
|
3-5
YEARS
|
MORE
THAN
5
YEARS
|
|||||||||||
Operating
Lease Obligations
|
$
|
423,000
|
$
|
193,000
|
$
|
230,000
|
$
|
—
|
$
|
—
|
||||||
Purchase
Obligations(1)
|
3,380,000
|
3,380,000
|
—
|
—
|
—
|
|||||||||||
Asset
Retirement Obligations
|
8,842,000
|
188,000
|
5,516,000
|
—
|
3,138,000
|
|||||||||||
Total
|
$
|
12,645,000
|
$
|
3,761,000
|
$
|
5,746,000
|
$
|
—
|
$
|
3,138,000
|
THREE
MONTHS ENDED MARCH 31,
|
|||||||||||||
|
2007
SALES
|
2006
SALES
|
|||||||||||
|
BBLS
|
AVERAGE PRICE
A.$
PER BBL
|
BBLS
|
AVERAGE PRICE
A.$
PER BBL
|
|||||||||
Australia:
|
|||||||||||||
Mereenie
field
|
23,548
|
80.79
|
24,034
|
89.63
|
|||||||||
Cooper
Basin
|
2,754
|
81.72
|
|
13,934
|
97.53
|
||||||||
Nockatunga
project
|
10,538
|
82.40
|
10,977
|
81.62
|
|||||||||
Total
|
36,840
|
81.32
|
48,945
|
90.03
|
|
THREE
MONTHS ENDED
|
||||||
|
MARCH
31,
|
||||||
|
2007
|
|
2006
|
||||
Australia
|
$
|
3,879,000
|
$
|
3,382,000
|
|||
Canada
|
—
|
—
|
|||||
Total
|
$
|
3,879,000
|
$
|
3,382,000
|
THREE
MONTHS ENDED MARCH 31,
|
|||||||||||||
|
2007
SALES
|
2006
SALES
|
|||||||||||
|
A.$
AVERAGE
PRICE
PER
|
|
A.$
AVERAGE
PRICE
PER
|
||||||||||
BCF
|
MCF
|
BCF
|
|
MCF
|
|
||||||||
Australia:
Palm Valley
|
.368
|
|
2.20
|
.373
|
2.17
|
|
|||||||
Australia:
Mereenie
|
1.164
|
3.47
|
1.085
|
3.23
|
|||||||||
Total
|
1.532
|
3.16
|
1.458
|
2.95
|
2007
|
2006
|
||||||
Income
before income taxes and minority interests
|
$
|
578
|
$
|
2,295
|
|||
Tax
at 30%
|
173
|
688
|
|||||
MPC’s
valuation allowance for non Australian loss
|
108
|
102
|
|||||
Non-taxable
revenue from Australian sources
|
(113
|
)
|
(79
|
)
|
|||
Depletion
on step up basis of oil & gas properties
|
108
|
6
|
|||||
Australian
income tax provision
|
276
|
717
|
|||||
MPC
income tax provision
|
16
|
--
|
|||||
Consolidated
income tax provision
|
$
|
292
|
$
|
717
|
|||
Current
income tax provision
|
$
|
14
|
$
|
201
|
|||
Deferred
income tax provision
|
278
|
516
|
|||||
Income
tax provision
|
$
|
292
|
$
|
717
|
|||
Effective
tax rate
|
51
|
%
|
31
|
%
|
NINE
MONTHS ENDED MARCH 31,
|
|||||||||||||
2007
SALES
|
2006
SALES
|
||||||||||||
|
BBLS
|
AVERAGE
PRICE
A.$
PER BBL
|
BBLS
|
AVERAGE
PRICE
A.$
PER BBL
|
|||||||||
Australia:
|
|||||||||||||
Mereenie
field
|
76,330
|
81.11
|
77,077
|
|
83.41
|
||||||||
Cooper
Basin
|
13,767
|
84.66
|
18,554
|
94.36
|
|||||||||
Nockatunga
project
|
41,540
|
76.08
|
25,812
|
77.35
|
|||||||||
Total
|
131,637
|
79.89
|
121,443
|
83.76
|
NINE
MONTHS ENDED MARCH 31,
|
|||||||
|
2007
|
2006
|
|||||
Australia
|
$
|
11,772,000
|
$
|
10,264,000
|
|||
Canada
|
2,000
|
51,000
|
|||||
Total
|
$
|
11,774,000
|
$
|
10,315,000
|
NINE
MONTHS ENDED MARCH 31,
|
|||||||||||||
|
BCF
|
2007
SALES
A.$
AVERAGE PRICE
PER
MCF
|
|
BCF
|
|
2006
SALES
A.$
AVERAGE PRICE
PER
MCF
|
|
||||||
Australia:
Palm Valley
|
1.149
|
2.20
|
1.286
|
2.17
|
|||||||||
Australia:
Mereenie
|
3.453
|
3.41
|
3.186
|
3.11
|
|||||||||
Total
|
4.602
|
3.10
|
4.472
|
2.83
|
|
2007
|
2006
|
|||||
Income
before income taxes and minority interests
|
$
|
2,547
|
$
|
3,469
|
|||
Tax
at 30%
|
794
|
1,041
|
|||||
MPC’s
valuation allowance for non Australian loss
|
364
|
451
|
|||||
Non-taxable
revenue from Australian government sources
|
(312
|
)
|
(245
|
)
|
|||
MPAL
non-taxable foreign income (New Zealand)
|
6
|
45
|
|||||
Other
permanent differences
|
401
|
28
|
|||||
Australian
income tax provision
|
1,223
|
1,320
|
|||||
MPC
income tax provision
|
16
|
12
|
|||||
Consolidated
income tax provision
|
$
|
1,239
|
$
|
1,332
|
|||
Current
income tax provision
|
$
|
72
|
$
|
1,747
|
|||
Deferred
income tax provision (benefit)
|
1,167
|
(415
|
)
|
||||
Income
tax provision
|
$
|
1,239
|
$
|
1,332
|
|||
Effective
tax rate
|
49
|
%
|
38
|
%
|
PERIOD
|
TOTAL
NUMBER OF
SHARES
PURCHASED
|
AVERAGE
PRICE
PAID
SHARE
|
TOTAL
NUMBER OF SHARES
PURCHASED
AS PART OF
PUBLICLY
ANNOUNCED PLAN
(1)
|
|
MAXIMUM
NUMBER OF SHARES
THAT
MAY YET BE
PURCHASED
UNDER PLAN
|
||||||||
Jan.
1-31, 2007
|
0
|
0
|
0
|
319,150
|
|||||||||
Feb.
1-28, 2007
|
0
|
0
|
0
|
|
319,150
|
||||||||
Mar.
1-31, 2007
|
0
|
|
0
|
0
|
319,150
|