Today, ROC released its ASX Preliminary Final Report (Appendix 4B) detailing the financial results for the financial year ended 31 December 2001, the key elements of which are:

· Record $24 million underlying profit after tax before including asset sales, development asset write downs and exploration expenditure written off or expensed, up 45% on the comparable result for 2000.

· $9.2 million net loss after tax after including asset sales ($5.8 million), development asset write downs ($38.4 million) and exploration expenditure written off or expensed ($0.6 million). The $38.4 million non cash development asset write down relates to the very recently agreed sale of three North Sea assets referred to below. This result compares to a 2000 result of $15.1 million net profit after tax and after adjustments.

· Record $48.3 million trading profit, up 28% on 2000.

· Record $102 million sales revenue, up 12% on 2000, despite 14% reduction in production and weakening oil prices in the second half of 2001.

· Record $73 million cash flow from operating activities, up 31% on 2000, equates to $0.68/share and a year end price to cash flow ratio of 2.2.

· Record $76 million in cash and short term deposits at end-2001, up 36% on 2000 despite record exploration expenditure and funding, from internal sources, of the development of the Kyle Oil and Gas Field in the North Sea.

· $32.5 million EBITDA, down 44% on 2000.

· Record $66.6 million EBITDAX1 , up 12% on 2000.

· No net debt as at 31 December 2001 with bank debt remaining unchanged for the financial year at US$30.5 million, equates to 29% debt:equity.

ROC's 2001 profit/loss results are strongly influenced by the planned separate sales of three North Sea assets to which the Company very recently agreed and which are currently in the process of being documented. Each of the sales is subject to normal industry terms and conditions, including receipt of approvals from the UK Department of Trade and Industry ("DTI") and co-venturers and the execution of final sales documentation. The sales are effective 1 January 2002 and the impact of the sales has been included in the Company's 2001 results. Specifically:

· ROC has agreed to sell, for a total of £11.80 million (approximately $33.5 million at year end 2001 exchange rates), its interests in three North Sea assets: the producing Kyle Oil and Gas Field (12.5%), the undeveloped Chestnut Oil Field (14.875%) and a minority interest in a southern North Sea gas exploration permit. In addition, ROC will receive a further £750,000 ($2.1 million) production payment subject to the further development of the Chestnut Oil Field.

· The three asset sales are consistent with ROC's strategy of monetising assets which have underperformed original expectations, so that the Company will be better able to access other internal and external investment opportunities.

· In addition to the sale proceeds, ROC estimates that during the next two years it will effectively retain more than $60 million that otherwise would have been spent on capital expenditures and operating costs relating to the assets which it is selling.

· ROC's cash and short term deposits will increase to almost $100 million (approximately $0.90/share) upon completion of the sale and subject to the precise timing of the closing of the transactions.

· The three sales will cause ROC's proved and probable (2P) reserves to reduce by 30% to approximately 20 MMBOE and its production to reduce by 25% to about 5,800 BOEPD. Virtually all of ROC's production in 2002 will be gas. Importantly, the sale will have a positive impact on ROC's already low operating cost per barrel of oil equivalent.

· The current sale process will bring to $102 million the total amount which ROC has monetised through the divestment of some of the peripheral parts of the UK portfolio, all of which it acquired in July 1999 for $120 million plus the assumption of US$46 million of debt. Since then, that portfolio has generated $205 million in sales revenue and $130 million cash flow from operating activities. During the same period, the associated debt has been reduced by US$15.5 million.

· The non-cash development asset write down of $38.4 million is despite the fact that the collective sale price realised for the assets is in excess of the value calculated by the Calgary-based Independent Expert, Adams Pearson and Associates, based on the risked (proved plus 50% probable) reserve base discounted at a rate equivalent to ROC's weighted average cost of capital and using the Company's internal oil price forecast. Importantly, if ROC's remaining UK assets are valued on the same risked discounted cash flow basis, their aggregated value would significantly exceed their current book value.

· Importantly, ROC will retain its 100%-owned Saltfleetby Gas Field, the Company's only revenue source, and the onshore exploration acreage which surrounds it. ROC will also retain a number of undeveloped fields in the North Sea, together with the associated exploration acreage, including the area to the east of the very significant Buzzard field which was discovered last year. The North Sea assets which are not part of the sale process are considered to have more upside oil exploration potential than the North Sea assets which are being sold.

Commenting on the 2001 financial results, ROC's Chief Executive Officer, Dr John Doran stated that:


"When you peel away all the non-cash numbers and the details which are not overwhelmingly relevant to the day-to-day running of a business, you find a company with no net debt being driven by exceptionally strong cash flow from its low cost gas field in England. You also find a company that is consistently implementing its sensibly contrary strategy by reinvesting that cash flow and the proceeds of peripheral UK asset sales, in potential growth projects onshore UK, offshore West Africa and in selected parts of Australia and Asia.

It is still too early to claim that ROC's strategy of focusing on undervalued, unfashionable, assets is a success, but the way the UK asset base has performed during the last couple of years and the run of exploration and appraisal success which the Company has experienced elsewhere in the world since mid-2001, suggests that the strategy remains very much on target."

Dr John Doran
Chief Executive Officer
E-mail: jdoran@rocoil.com.au

Return to ROC's ASX Releases main page

WEI-6-12-1 EXPLORATION WELL, OFFSHORE CHINA: UPDATE

KEY POINTS


· The Wei-6-12-1 exploration well, ROC's first well in China, has drilled a 13.5 metre gross oil column with a nine metre net oil pay, with excellent reservoir characteristics and good quality oil. An oil-water contact has not been encountered but pressure readings suggest that it could be quite close to the bottom of the oil column in the well which is located about 80 metres down dip from the structural high point.

· The well, which will be plugged and abandoned as an oil discovery, has high graded the prospectivity of the block in general and, more specifically, a significantly larger prospect which lies about five kilometres to the southeast.

· On the basis of the well results ROC will exercise its option to enter into the next Permit Term and, subject to government approval, serve as operator with the intention of applying stratigraphic seismic techniques which have been used with great success in deep waters offshore Mauritania, Equatorial Guinea and other parts of West Africa.

ROC is pleased to advise that, as of 9.00am 12 March 2002 (Sydney time), its first well in China, the Wei-6-12-1 exploration well in the Beibu Gulf, had reached a total depth of 1,755 metres and logging was almost complete.

Drill and log data and fluid sampling indicate that there is a 13.5 metre gross oil column between 1,559 and 1,572.5 with nine metres of oil-filled net sand with an average interpreted porosity of 28%. An oil-water contact has not been seen in the well and the oil appears to be of good quality.

The well was positioned about 80 metres down dip from the high point of the structure which has a large stratigraphic component. Pressure readings suggest that the oil-water contact for this particular oil-bearing sand could be quite close to the bottom of the oil column in the well. A separate ten metre net sand interval drilled between 1,450 and 1,550 metres has oil shows and excellent reservoir characteristics and is considered to have up dip oil pay potential.

The well will be plugged and abandoned as an oil discovery the commerciality of which will require further study. The discovery has upgraded the potential of the area in general, especially a comparable, but potentially much larger, prospect about five kilometres to the southeast.

The Joint Venture is currently considering its overall forward strategy but, on the basis of the well results, ROC will exercise its option to proceed into the next Permit Term and, subject to government approval, serve as operator for and on behalf of a Joint Venture which presently consists of four Australian oil explorers:

Bligh Oil and Minerals NL (current operator) . . . . 40%
Roc Oil (China) Limited (designated operator) . . .25%
Petsec Energy Limited . . . . . . . . . . . . . . . . . . 25%
First Australian Resources Limited . . . . . . . . . . .10%

Commenting on the discovery ROC's Chief Executive Officer, Dr John Doran, stated that:


"ROC looks forward to working with its co-venturers and the relevant government authorities in China, to more fully explore and develop this area which is so clearly prospective. Amongst other things, we want to see if some of the stratigraphic seismic techniques to which ROC has been exposed in the deepwater plays offshore Mauritania and Equatorial Guinea can be applied with equal success to the Beibu Gulf.

We are very encouraged not only by the well results but also by the efficiency with which the well was drilled, the quality of the 3D seismic data base, the several undeveloped fields which are already known to exist within the permit and the probability that a commercial field development could be undertaken quickly and for modest cost."

Dr John Doran
Chief Executive Officer
E-mail: jdoran@rocoil.com.au

Return to ROC's ASX Releases main page

KEY POINTS

· ROC's first well in China is drilling ahead, preliminary results expected prior to end of next week


1. EXPLORATION

1.1 DRILLING

1.1.1 Beibu Gulf, Republic of China (ROC: earning 25%)

At 6.00 am today (local time), the Wei 6-12-1 well was drilling ahead at a depth of 1,097 metres in 12¼" hole. The primary reservoir objective is expected to be drilled and evaluated prior to the end of next week.

1.2 SEISMIC

The 3D seismic surveys underway onshore UK (ROC: 100%) and offshore Mauritania (ROC: 2.4% to 2.7%) reported last week are continuing.

Dr John Doran
Chief Executive Officer
E-mail: jdoran@rocoil.com.au

Return to ROC's ASX Releases main page

KEY POINTS

· ROC's first well in China starts drilling

· Second 3D seismic survey Onshore Humber Basin commences


1. EXPLORATION

1.1 DRILLING

1.1.1 Beibu Gulf, Republic of China (ROC: earning 25%)

The Wei 6-12-1 exploration well in Block 22/12 started drilling at 30 minutes past midnight on 1 March 2002 with the Nanhai IV jack-up drilling rig. At 0600 hours on 1 March 2002 the well was drilling ahead in 36" hole at a depth of 130 metres. The well is expected to reach total depth of 1,750 metres within two weeks. More details on ROC's interest in Block 22/12 and the Wei 6-12-1 well are set out in ROC's ASX Release dated 8 February 2002.

1.2 SEISMIC

1.2.1 South Humber Basin, Onshore UK (ROC: 100% and Operator)

The 254 sq km Lincs Wolds 3D seismic survey commenced recording on 25 February 2002.

Dr John Doran
Chief Executive Officer
E-mail: jdoran@rocoil.com.au

Return to ROC's ASX Releases main page