Page 61 - Sun Resources 2014 Annual Report

15 Capital and Leasing Commitments
Exploration expenditure commitments
The Company has joint venture and statutory expenditure commitments on its areas of interest as at 30 June 2014.
Consolidated
2014 2013
$ $
Within one year 6,000,000 3,000,000
Later than one year, but not later than five years 1,000,000 1,000,000
7,000,000 4,000,000
Financial commitments for subsequent periods are contingent upon future exploration results and cannot be estimated.
Oil Projects Lease Renewal
Delta Oil Project (100% WI)
During the next 12 months, in order to maintain its leases the Company may be required to make additional payments
to extend its oil and gas leases for a further two years, if they are not converted to ‘Held-by-Production’ (HBP).
Approximately 40% of the total Delta Oil Project oil and gas leases held by the Company may be required to
be renewed with the current cost of these lease extensions projected to be approximately $3,000,000 (2013:
$500,000).
Other Oil Projects (13% to 50% WI)
All net acres of mineral leases in the Beeler (Richland) Oil Project are currently HBP and do not need to be renewed
while production continues.
All mineral leases currently held under the Amerril Oil Project and Normangee Oil Project are valid for three years
from their original inception and are capable of being extended for a further two years, where the leases contain such
clauses. Pre-agreed renewal rates are generally between $300-$500 per net mineral acre. With successful drilling
and fraccing across these lease positions, mineral leases would be absorbed into production units that become
HBP. Other (non HBP leases) would need to be extended by paying cash for their extension typically at a price
agreed at the time the original lease is issued.
Non-cancellable operating lease commitments
The Group leases its head office in West Perth, Western Australia under a non-cancellable operating lease expiring
on the 30 June 2016 with an option to renew for a further three years at the Company’s option.
The Company has provided a bank guarantee for $73,873 as a bond.
Commitments for minimum lease payments in relation to non-cancellable operating leases are payable as follows:
Consolidated
2014
$
2013
$
Within one year 171,852 168,828
Later than one year, but not later than five years 171,852 347,853
343,704 516,681
The Directors are not aware of any other expenditure commitments.
NOTES TO AND FORMING PART OF THE CONSOLIDATED
FINANCIAL STATEMENTS
SUN RESOURCES ANNUAL REPORT 2014  59