Registered office
C/- Emcee 
44 Southampton Buildings 
London UK  
WC2A 1AP
Operations Office – Rome  London Office
Via Cornelia 498  16 Old Queen Street
Roma 00166  London UK
Italy SW1H 9HP
www.medoilgas.com
Building a  
resource  
factory
Annual Report 2011
Mediterranean Oil & Gas Plc Annual Report 2011 01-17
Business review
01 Highlights
02 The Company at a glance
04 Our strategy for growth
06 Chairman’s statement
08 Chief Executive’s report
14 Financial review
16 Principal risks and uncertainties
18-25
Corporate governance
18 Board of Directors
20 Senior management
21 Directors’ report
23 Corporate governance statement
24 Remuneration report
26-56
Financial statements
26 Independent auditors’ report
27 Financial statements
57-59
57 Notice of Annual General Meeting
59 Corporate directory
FSC Logo  01
Mediterranean Oil & Gas Plc Annual Report 2011 www.medoilgas.com
BUSINESS
REVIEW
CORPORATE
GOVERNANCE
FINANCIAL
STATEMENTS
Highlights
Corporate and Operational Highlights within the 
Reported Period
 > May: PSC Extension agreement signed  
with the Maltese Government on Malta Area 4  
(Blocks 4, 5, 6, 7)
 > May: General Meeting of shareholders approves 
€22.4m equity raise, settlement of the Bank of 
Scotland loan facility and conversion of convertible 
bonds and loan notes to equity
 > May: Guendalina development drilling completed 
successfully
 > August: Guendalina platform installed and gas 
pipeline laid out
 > October: first gas at Guendalina gas field
 > December: completed acquisition of 1,012 sq km of 
3D seismic data, Malta offshore Area 4
Financial Highlights within the Reported Period
 > Gas production of 17.6MM scm; 0.62 Bcf (2010: 12.3 
MM scm; 0.43 Bcf)
 > Revenues from gas and condensate sales of 
€5.65m (2010: €3.49m)
 > Profit before tax of €2.8m (2010: €7.8m loss)
Post Reporting Date Highlights
 > January: issuance of Competent Person’s Report by 
RPS Energy Limited, increasing 2P recoverable 
reserves at Guendalina gas field by 42% to 31.2 Bcf 
(6.2 Bcf net to MOG)
 > April: completion of processing of 3D seismic data, 
Malta offshore Area 4
 > April: entry into gas purchase agreement for 
Guendalina gas field with Repower Italia SpA
 > May: Italian Ministry for Economic Development 
grant of three year extension to the exploration 
permit at Ombrina Mare (BR269 GC)
Outlook
 > Guendalina gas sales to materially increase the 
Company’s revenues and cash flow
 > Company will continue to extract value from other 
operating assets and de-risk prospective and 
contingent resources
 > Resolution of Ombrina Mare will continue  
to be actively pursued with the Italian Government
 > Strategic growth opportunities will be pursued 
actively
Mediterranean Oil & Gas Plc (‘MOG’ or the ‘Company’) is 
an Aim listed oil & gas production, development and 
exploration company which owns and operates assets 
in the central Mediterranean region.
“ The work undertaken over the past 12 months has 
significantly strengthened the Group’s technical and 
commercial position in the Mediterranean.” 
 Dr. Bill Higgs, Chief Executive 02
Mediterranean Oil & Gas Plc Annual Report 2011 www.medoilgas.com
BUILDING A RESOURCE 
FACTORY
ACQUISITIONS
DEVELOPMENT
PRODUCTION
EXPLORATION
MOG owns and operates 
assets in the central 
Mediterranean region.
The Company at a glance
1
2
4
3
5
6 03
Mediterranean Oil & Gas Plc Annual Report 2011 www.medoilgas.com
BUSINESS
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STATEMENTS
1
 Onshore Italy
Gas exploration,  
development and production
•  Geographically spread low risk 
production and exploration 
opportunities
•  Returns on assets to cover operating 
costs for the Group
2
 Northern Adriatic
Guendalina gas production
•  Non-operated gas production 
providing ~75% of revenues
•  Asset delivers net cash flow for small 
capital projects
Northern Adriatic gas exploration and 
development
•  Non-operated gas discoveries with 
upside potential
•  Goal is to increase the priority of 
these developments in the overall 
portfolio of ENI
3
 Ombrina Mare
Ombrina Mare oil development
•  100% operated oil discovery with 
upside potential
•  Goal is to achieve development 
approval from Ministry of Economic 
Development
4
 Southern Apennines
Monte Grosso oil and gas exploration 
•  Exploration prospect on trend with 
Val D’Agri (one of the largest onshore 
fields in Western Europe) and Tempa 
Rossa fields.
•  Technically challenging exploration 
well that is currently waiting for EIA 
approval of the well proposal
5
 Malta
Malta oil and gas exploration
•  Frontier exploration which is 
unproven in Malta
•  Prospect size and presence of 
hydrocarbons are key risks, which are 
being mitigated with the 3D seismic 
and basin modelling
•  Evaluation in progress with results 
expected early in the 3rd Quarter  
of 2012
6
 France
France gas exploration
•  Triassic Bunter Sandstone play 
analogous to North Sea southern 
Gas Basin, but unproven in southern 
France.
•  Structural geometry and hydrocarbon 
charge are the key risks. 2012 plan is 
to acquire 400km of 2D seismic over 
the prospect 04
Mediterranean Oil & Gas Plc Annual Report 2011 www.medoilgas.com
Our strategy for growth
Regional Operator
Leverage our competitive advantage  
that lies in the breadth and depth of our 
Italy-based team that manages the 
‘full-value chain’ of our E&P business 
together with our AIM-listing, 
knowledgeable management team and 
strong support from our key shareholders
Financial Strength
Being debt free, we will use the steady 
income from our onshore and offshore 
gas production to underwrite our 
operating costs, support asset maturation 
and small capital programmes. 05
Mediterranean Oil & Gas Plc Annual Report 2011 www.medoilgas.com
BUSINESS
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FINANCIAL
STATEMENTS
Balanced Portfolio
Use our Resources Factory to our 
advantage. Grow production and move 
resources to reserves by maturing the 
portfolio in support of our production 
growth targets. Balance frontier 
exploration with asset maturation and 
good reservoir management
Growth Opportunity
Prudently invest to de-risk our attractive 
Prospective Resources opportunities of 
more than 1.4bn BOE (likely unrisked) and 
look for low cost entry and high potential 
value acreage to add to our portfolio 06
Mediterranean Oil & Gas Plc Annual Report 2011 www.medoilgas.com
MOG’s subsidiary, Medoilgas Italia SpA, 
has entered into a gas sales contract with 
Repower Italia SpA, covering all of the 
Company’s net gas production from the 
Guendalina gas field, effective from 1 April 
2012. As a result of the strong revenues 
from Guendalina and our onshore Italy 
assets, the Company is now in a much 
more favourable position to develop our 
key commercial objectives and growth 
strategy. 
In May, the Company agreed an 18 month 
extension of the first exploration phase 
under the Malta offshore Area 4 (MOG W.I. 
90% and Operator) Production Sharing 
Contract. On 14 December 2011, the 
Company, through its subsidiary Malta Oil 
Pty Ltd contracted with Fugro-Geoteam Pty 
Ltd to acquire 1,012 sq km of long offset 3D 
seismic exploration data in relation to its 
licence commitment. The processing of this 
data has been completed, the 
interpretation is underway to identify 
potential prospects within the licence area, 
and the results of this study are expected 
early in the 3rd Quarter of 2012. 
Keith Henry
Non-Executive Chairman
Dear Shareholder,
Mediterranean Oil & Gas Plc (‘MOG’, or the 
‘Company’), is pleased to announce the 
Company’s 2011 results. 
Although I became Chairman of the 
Company in January 2012 and was 
therefore not involved with the Company 
during 2011, on behalf of the Board I am 
pleased to be able to report on what was 
undoubtedly a transformational year for 
the Company. 
As a result of the Company’s restructuring 
in May 2011, MOG’s financial position was 
materially strengthened with £19.1m in new 
equity (post transaction expenses) being 
raised and the Company being left free 
of debt.
The key development for the year was the 
commencement of gas production from the 
offshore Guendalina gas field (MOG W.I. 
20%) on 25 October 2011. The field is 
performing in line with our expectations, 
with an average gross production of 
580,000 scm/day for the 1st Quarter of 2012 
(MOG 116,000 scm/day). 
Chairman’s statement
The Board remains focused and committed to 
growing the Company and we are actively seeking 
opportunities to expand our current portfolio 07
Mediterranean Oil & Gas Plc Annual Report 2011 www.medoilgas.com
BUSINESS
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STATEMENTS
“ The Company continues  
to build up a very 
experienced technical  
and management  
team highly capable  
of exploring  
and developing oil  
and gas assets.”
 Keith Henry 
 Non-Executive Chairman
The Company’s Ombrina Mare oil and gas 
project (MOG W.I. 100% and Operator) in 
20m water depth, 7km offshore Italy, 
remains subject to the restrictions imposed 
by Legislative Decree no. 128, dated 29 June 
2010 which amends the earlier Italian 
Environmental Code (Decree no. 152/2006). 
MOG is in active dialogue with the Italian 
Government with regard to lifting the 
imposed restrictions. We were pleased to 
receive a 3 year extension to our 
exploration permit BR269 GC in May of this 
year and see this as a positive sign in our 
ongoing discussions with the Italian 
authorities regarding the issuance of a 
production concession for our proposed 
development of the Ombrina Mare field, 
which is located in the permit area. We are 
working with external legal counsel on the 
analysis and implementation of alternative 
courses of action should discussions with 
the Italian authorities fail to progress. 
Although there is no certainty on either the 
timing or the results of our request for a 
production concession, the Company is 
optimistic of a positive outcome.
During 2011, a number of changes were 
made to the membership of the Board  
and the Executive Management Team. 
Following the restructuring in May, Peter 
Clutterbuck retired from the Board and 
Miles Donnelly and Michael Seymour 
joined the Board as Non-Executive 
Directors. In October, Andrew Cochran 
stepped down from the Board as 
Non-Executive Chairman to be replaced, on 
a temporary basis, by Matthew Clarke and 
Michael Bonte-Friedheim stepped down 
from the Board as Chief Executive, to be 
replaced on a temporary basis by Sergio 
Morandi. The Board wishes to thank 
Michael, Andrew and Peter for their 
contributions to the Company.
Jake Ulrich and I joined the Board in 
January 2012 as Non-Executive Directors, 
and Dr. William ‘Bill’ Higgs joined the Board 
as MOG’s Chief Executive in March. Bill has 
over 23 years of global exploration, 
development and operations experience 
working with Chevron Corporation. Bill is a 
qualified geologist with extensive expertise 
in all engineering and other technical and 
commercial aspects of hydrocarbon 
exploration, development and production.  
I am delighted to welcome someone with 
such international experience and industry 
knowledge to the MOG Board.
Outlook
2011 was a difficult year, but one that saw 
the Company transform both its financial 
and commercial position, with considerably 
enhanced revenues now coming from the 
Guendalina gas sales. During 2012, we will 
work with the Italian authorities to achieve a 
positive solution to allow us to restart our 
suspended work on Ombrina Mare. The 
Competent Persons Report interpreting the 
results of the 3D survey for Malta Area 4 is 
due to be completed during the 3rd 
Quarter, enabling the Company to review 
its potential development options. 
MOG continues to build up a very 
experienced technical and management 
team highly capable of exploring and 
developing oil and gas assets. To that end, 
the Board remains focused and committed 
to growing the Company and we are 
actively seeking opportunities to expand 
our current portfolio. 
On behalf of the Board, I would like to thank 
our shareholders and employees for their 
continued support of the Company.
Keith Henry
Non-Executive Chairman
24 May 2012 08
Mediterranean Oil & Gas Plc Annual Report 2011 www.medoilgas.com
The Group is now in a strong financial and 
operational position, which will enable 
MOG to actively seek strategic growth 
opportunities while progressing its portfolio 
of production, development and 
exploration assets.
Looking back, 2011 was a difficult year due 
to unexpected regulatory developments 
affecting Ombrina Mare, which is a key 
asset for the Company, and the uncertain 
economic environment. However, the 
Group retained a clear focus on securing 
value from its operational structure and its 
extensive and diverse asset base; and it is 
now reaping the benefits, following the 
Group recapitalisation and the significant 
increase of gas production. 
The Company has a broad asset base 
across the exploration, development and 
production phases of the business. These 
assets have significant upside potential 
and we now have the financial strength to 
de-risk and mature these assets over the 
coming years, while also looking for 
valuable opportunities for asset acquisition.
William Higgs
Chief Executive
Mediterranean Oil & Gas Plc (‘MOG’ or the 
‘Company’) is pleased to announce its 
results for 2011.
The year 2011 has seen transformational 
developments on the financial and 
operational fronts. 
The Group recapitalisation completed in 
May left MOG free of financial debt with  
a cash and cash equivalent position of 
€17 .5m at 30 June and €3.7m at 
31 December 2011. This was a positive step 
in enabling the Company to embark on its 
growth objectives by funding first gas at 
Guendalina while remaining debt free. 
The development of the Guendalina gas 
field (20% MOG W.I.) has been completed 
successfully and gas production started on 
25 October 2011, providing the Company 
with a sound revenue base going forward. 
Chief Executive’s report
Building a resources factory 09
Mediterranean Oil & Gas Plc Annual Report 2011 www.medoilgas.com
In the last year...
BUSINESS
REVIEW
CORPORATE
GOVERNANCE
FINANCIAL
STATEMENTS
“ The work undertaken  
over the past year has 
significantly strengthened 
the Group’s technical and 
commercial position.” 
 Bill Higgs,  
 Chief Executive
Operational Highlights
• Completion of Guendalina gas field 
development in Italy and start-up of  
the gas production late October 2011
• Acquisition of 1,012 sq km of high 
resolution long offset 3D seismic on 
Area 4 offshore Malta
• Following the commencement of 
Guendalina gas production:
• The Company’s daily gas production 
has increased by over 400% to about 
950 boe/day
• Revenues for the year increased 62% 
compared to 2010
Post Period Highlights
• Guendalina gas field in full production 
• Guendalina 2P gas Reserves increased 
42% (Independent Certification by RPS)
• Appointment of Mr. Keith Henry as  
Non-Executive Chairman
• Appointment of Dr. William ‘Bill’ Higgs  
as Chief Executive
• Italian Ministry for Economic 
Development grant of three year 
extension to the exploration permit at 
Ombrina Mare (BR269 GC)
Gas Production and Prices
All gas production of the Group currently 
occurs in Italy.
In 2011, gas production was approximately 
17 .6 MMscm (0.62 Bcf), which represented a 
44% increase relative to the prior year. This 
was largely due to the commencement of 
gas production at the Guendalina gas field 
in late October 2011. 
During 2011, the Brent oil price has been 
relatively constant at around $110/bbl,  
while the Euro vs US Dollar exchange rate 
has experienced significant fluctuations 
which have strongly influenced the gas 
price received by the Group under its gas 
sales contracts. The average gas sales 
price achieved during the period was 
€0.32/scm ($12.7 per thousand cubic feet); 
higher than in 2010, when the average gas 
sales price was €0.28/scm ($10.7 per 
thousand cubic feet). 
The Company’s forecasts for future gas 
prices indicate that this positive trend is 
expected to continue in 2012. 
The gas offtake contracts currently in 
force are:
• Repower Italia SpA, covering the Group’s 
entire Guendalina net gas production 
offtake (which represents about 75% of 
the Group’s current gas production)
• Gas Plus Italia SpA, covering the largest 
part of the Group’s onshore gas 
production offtake
• Rimini Gas Spa, covering production 
offtake from the Misano Adriatico 
concession
• Eni SpA, covering production offtake 
from the San Andrea concession 
• Seicogen SpA, covering production 
offtake from the Masseria Vincelli field 
inside the Torrente Cigno concession
 
December 2011
Completed acquisition 
of 1,012 sq km of 3D 
seismic data, Malta 
offshore Area 4
May 2011
General Meeting of 
shareholders 
approves €22.4m 
equity raise, 
settlement of Bank 
of Scotland loan 
facility and 
conversion of 
convertible bonds 
and loan notes,  
to equity
October 2011
First gas at 
Guendalina gas field
May 2011
Guendalina 
development drilling 
completed 
successfully
August 2011
Guendalina 
platform installed 
and gas pipeline 
laid out
May 2011
PSC Extension 
agreement signed 
with Maltese 
Government on 
Malta Area 4  
(Blocks 4, 5, 6, 7) 10
Mediterranean Oil & Gas Plc Annual Report 2011 www.medoilgas.com
Chief Executive’s report continued
• the Company is committed to de-risk 
and mature resources, to progressively 
replace reserves, maintaining the 2P 
RRR at around 100% and targeting R/P  
of around 9
Asset Overview
Italy – Onshore gas
In Italy, the Company has a large number 
of onshore production and exploration gas 
assets. In this E&P acreage the existing 
production is not the only value. In fact, 
several interesting development and 
exploration projects are also present, 
mainly within existing production 
concessions that have the potential to 
unlock approximately 12 to 14 Bcf net 
unrisked prospective resources to the 
Group and achieve new near to mid-term 
gas production. 
During the period:
• a review of residual onshore gas 
exploration potential has been 
undertaken. In the first half of 2012, 
management will complete the ranking 
of the prospects with the goal of drilling 
wells over the next three years to 
regenerate reserves and production 
from this element of the portfolio
Oil & Gas Reserves and Resources 
The Group’s reserves and resources  
are reviewed on an annual basis by 
independent certifiers (Proven, Probable and 
Possible Reserves) and/or by the Company 
(Contingent and Prospective Resources). 
The following tables summarise the 
evolution of the Group’s hydrocarbon 
reserves and resources since 2006 and 
includes the latest update, as at 
31 December 2011.
At the end of 2011:
• 2P Oil Reserves & Resources remained 
substantially unchanged 
• the ‘2P RRR’ (Reserves Replacement 
Ratio) for the gas is around 105%, which 
means that the Company has 
successfully replaced all production 
from 2011 in the reserves ledger
• the Company’s R/P ratio for gas is 14.7
• 2P Gas reserves increased due to the 
annual revision of the Group’s onshore 
gas fields reserves performed by SIM 
and the new independent certification of 
Guendalina Gas Reserves by RPS 
• Gas Prospective Resources also 
increased, on average 42%, as a result 
of the review of the gas exploration 
potential performed on the Italian and 
French E&P Assets 
Net Oil Reserves & Resources in MMbbls
Reserves 
Proven plus 
Probable (2P) 
MMbbls
Best Estimate 
Contingent 
Resources 
MMbbls
High Estimate 
Contingent 
Resources 
MMbbls
Prospective 
Resources 
(unrisked) 
Best Estimate 
MMbbls
Prospective 
Resources 
(unrisked) 
High Estimate 
MMbbls
1 July 2006 0
1
29
2
70
2
1,577
3
4,447
3
30 June 2007 0
1
29
2
70
2
1,291
4
3,614
4
30 June 2008 20
1
12
2
19
2
1,419
4
3,951
4
31 December 2008 20
1
12
2
19
2
1,419
4
3,951
4
31 December 2009 20
1
12
2
19
2
1,419
4
3,951
4
31 December 2010 40
1
12
2
19
2
1,405
4
3,920
4
31 December 2011 40
1
12
2
21
2
1,405
4
3,920
4
1: Independent certification by SIM. 2: Company assessment. 3: RPS assessment. 4: RPS assessment except for Company 
assessment of Monteardone and Monte Grosso with total of 74 MMbbls best case and 109 MMbbls high case.
Net Gas Reserves & Resources in Bcf
Reserves 
Proven Plus 
Probable (2P) 
(Bcf)
Contingent 
Resources Best 
Estimate (Bcf)
Contingent 
Resources 
High Estimate 
(Bcf)
Prospective 
Resources 
(unrisked) Best 
Estimate (Bcf)
Prospective 
Resources 
(unrisked) High 
Estimate (Bcf)
1 July 2006 12
1
21
2
50
2
20
2
44
2
30 June 2007 11
1
25
2
61
2
70
2
138
2
30 June 2008 10
1
25
2
55
2
93
2
158
2
31 December 2008 17
1
25
2
55
2
93
2
158
2
31 December 2009 16.5
1
25
2
55
2
93
2
158
2
31 December 2010 17.6
1
25
2
55
2
48
2
120
2
31 December 2011 18.4
1
22.3
2
48
2
86
2
156
2
1: Independent certifications by SIM and RPS (Guendalina 2012 only). 2: Company assessment. 11
Mediterranean Oil & Gas Plc Annual Report 2011 www.medoilgas.com
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• some field revamping and new 
development projects have progressed, 
which will enable 2 to 3 Bcf net 2P 
reserves to be progressively placed on 
production within the next 12 to 24 
months
Italy – Offshore
The Company’s development efforts during 
the period under review were all focused 
on the Guendalina gas field offshore Italy in 
the northern Adriatic.
Guendalina Gas Field (MOG W.I. 20%,  
ENI W.I. 80% and Operator)
At Guendalina:
• the development activities included the 
installation of the production platform, 
drilling of two production wells, 
installation of all production 
infrastructure and start-up of gas 
production
• the drilling campaign confirmed the 
previously discovered gas-bearing sand 
levels and identified some minor new 
gas-bearing intervals 
The Company:
• entered a gas sales contract with the 
Italian Utility Elettrogas SpA to cover all 
the Company’s net gas produced from 
the field
• undertook an independent certification 
of the field gas reserves that post 
reporting date:
• revised 2P recoverable reserves of 
31.2 Bcf (6.2 Bcf net to MOG), 
representing an increase of 42% 
relative to the previous 
pre-development valuation of 22 Bcf 
(4.4 Bcf net to MOG)
• estimated P3 reserves of 40.3 Bcf (8.1 
Bcf net to MOG)
• provided an economic valuation of 
MOG’s 2P net reserves, in which the 
NPV, using a 10% discount rate, is 
€27 .2 million
The Guendalina gas field is located 47km 
offshore of the north-east coast of Italy, in 
42m of water. 
The field is performing in line with our 
pre-development forecasts, with an 
average gross production of 580,000 scm/
day for the 1st Quarter of 2012 (MOG 116,000 
scm/day). 
The Guendalina project represents a ‘game 
changer’ milestone for the development  
of the Company. It significantly increases 
the Company’s net production up to the 
equivalent of about 950 boe/day and 
provides revenues for at least the next  
4-5 years, with further potential upside  
to follow.
Other North Adriatic Gas Discoveries 
(MOG W.I. 15%)
The Guendalina project is inside one of the 
most important gas exploration and 
production areas in Italy and is situated 
70km to the south of four other discovered, 
but still undeveloped, offshore gas fields in 
which the Group has a 15% interest (ENI, 
Operator). 
These four gas discoveries amount to 
between 19 to 48 Bcf net contingent gas 
resources to the Group and represent an 
important growth opportunity for the 
Company. Their reclassification from 2C 
(Contingent Resources) to 2P reserves is 
expected to take place following 
authorisation of the development plans for 
the fields. 
Development activity for these fields has 
been frozen since 2001, pending the 
resolution of environmental concerns about 
developing the offshore region. The Italian 
Government indicated in 2009 that it is in 
favour of a positive resolution of these 
issues in this area of the Northern Adriatic. 
A portion of the Company’s A.C 19.PI 
concession lies within 12 miles of nature 
reserves and therefore may, in part, be 
impacted by the 2010 offshore restrictions 
introduced by the Italian Government for 
the offshore E&P activities. As the majority 
of the fields lie outside the 12 mile 
boundary, the Company expects the 
operator, ENI, to review the status of the 
concessions and subsequently, to present 
a field development plan.
Ombrina Mare Oil & Gas Discovery  
(MOG W.I. 100%)
The Ombrina Mare discovery is an 
important asset for the Company that, 
despite the offshore restrictions introduced 
for offshore E&P activities by the Italian 
Government in 2010, represents an 
important future growth opportunity. 
Following the successful drilling of two 
exploration/appraisal wells in 2008, the 
completion of a well as an oil producer and 
the set-up of a tripod platform in preparation 
for the development phase, the Company 
applied for a production Concession (d 30 
B.C-MD) in December 2008.
On 23 June 2009, the FDP project received 
technical approval from the Italian Ministry 
of Economic Development (‘MED’). 
On 3 December 2009, the project was 
submitted to the Italian Ministry of the 
Environment (‘ME’) for issuance of the 
relevant Environmental Impact Assessment 
(‘EIA’). Issuance of the EIA by the ME is a 
precondition for the MED to grant the 
production Concession. The Company 
obtained in early 2010, an independent 
certification of 40 MMbbls 2P oil reserves, 
of which proven (P1) oil reserves were just 
over 12 MMbbls. These oil reserves 
establish the Ombrina Mare field as a 
significant European oil project. 
Since June 2010, following the issuance of 
Italian Legislative Decree no. 128/2010 (the 
‘Decree’) prohibiting E&P activities in certain 
sea and Italian coastal areas, there 
remains some uncertainty over the Group’s 
ability to progress the Ombrina Mare 
project. The Decree provides, among other 
things, that the limitation does not apply to 
titles that, as at the date it came into force, 
had already been granted (i.e. ‘enabling 
titles’). The Italian Government has yet to 
clarify whether the Company’s interest held 
at Ombrina Mare falls within the exemption 
of an enabling title. 
The Company is continuing its active 
dialogue with the Italian Government, with 
a view to securing positive clarification of 
the Group’s title and/or obtain appropriate 
modifications to the text of the Decree. In 
addition, the Company is also working with 
external legal counsel on the analysis and 
implementation of alternative courses of 
action as a contingency plan.
In February 2012, Law Decree 5/2012, 
regarding ‘simplifications and economic 
growth’ was published in the Official 
Journal of the Republic of Italy clarifying that 
the limitations provided by Decree 128 do 
not apply to either existing mining titles or 
‘relevant extensions’. This Decree was 
ratified in law on 6 April 2012 (Law 35/2012). 
Following this, we were pleased to receive 
a 3 year extension to our exploration 
permit BR269 GC, where the Ombrina Mare 
field is located, in May of this year and see 
this as a positive sign in our ongoing 
discussions with the Italian authorities 
regarding the issuance of a production 
concession for our proposed development 
of the Ombrina Mare field.  12
Mediterranean Oil & Gas Plc Annual Report 2011 www.medoilgas.com
Chief Executive’s report continued
Since 2008, the Company has completed  
a detailed G&G assessment of the area, in 
order to de-risk the prospects and verify the 
presence of technically and commercially 
valuable exploration drilling opportunities. 
With this objective in mind, in late 2011 the 
Company acquired 1,012 sq km of high 
resolution long offset 3D seismic data on 
the most prospective sector of Area 4. The 
Company believes that this 3D data will  
be fundamental to completing the G&G 
assessment and de-risking the exploration 
potential. A comprehensive CPR has been 
commissioned. The results of this study, 
which are expected early in the 3rd Quarter 
of 2012, will underpin the Company’s 
strategy to seek a farm-in partner  
and progress the exploration of this 
interesting acreage.
France
The St. Laurent permit is located in southern 
France in a known gas and oil prone 
province. The Company has an 11% W.I. in 
this asset. In 2011, a detailed review of the 
gas play was completed in the permit area, 
which showed the presence of a number of 
high risk but high potential gas leads. The 
acquisition of 400km of infill 2D seismic has 
been planned for 2012 to supplement 
existing seismic data and complete a more 
proper definition of the leads and de-risk 
this exploration potential. The strategy for 
the licence will be decided following the 
analysis of this data. 
Health, Safety and the Environment 
(‘HSE’)
The Company continues to be committed to 
maintaining the highest standards in HSE 
management. No injuries or environmental 
incidents have been reported for the period 
under review. 
Since 2008, the Company has set up 
policies and procedures to conduct 
business in a safe, healthy and ethical 
manner. In 2011, the Company developed 
policies and procedures to achieve 
compliance with the UK Bribery Act and 
extended these principles to all the 
subsidiaries of the Group. 
 
Wildcat Exploration
Italy
In the Southern Apennines, the Group 
operates the Monte Grosso project, holding 
a 22.89% interest. The project is a high 
quality near field exploration opportunity 
close to one of the largest onshore oil 
producing areas in Western Europe. The 
Monte Grosso 2 exploration project 
presently remains on hold, pending 
resolution of residual permitting issues, 
which the Group presently believes should 
be positively resolved and allow a project 
start-up in mid 2014 (subject to rig 
availability). The Monte Grosso 2 well  
is targeting 280 MMbbls of unrisked 
prospective resources (64 MMbbls net to 
the Group) at a depth of 6,500m. Permitting 
and existing well site maintenance works 
were the main activities conducted during 
the period.
Offshore Malta
The Group operates Area 4 Offshore  
Malta (MOG W.I. 90%). Area 4 comprises 
approximately 5,700 sq km of deep water 
acreage north of the internationally-
recognised border between Malta 
and Libya.
The area is frontier exploration where no 
drilling activity has occurred and it is one of 
the rare areas that still remains to be 
explored in the Mediterranean basin. It is a 
high risk, but potentially a high reward 
geological environment where 9 prospects 
have been identified by RPS with a total of 
1,500 MMbbls of unrisked prospective oil 
resources. 
The Malta Production Sharing Contract 
(‘PSC’) was signed with the Maltese 
Government in July 2008. In May 2011, the 
Company agreed an 18 month extension  
to the first exploration period of the PSC 
with the Maltese Government, thus 
extending the first exploration period  
until mid-January 2013. The Company  
also announced the planned farm-out  
of a 75% W.I. to Dominion Petroleum Limited 
(‘Dominion’), subject to the approval of 
Dominion’s shareholders. Dominion was 
unable to secure the necessary approval 
and exercised its right to terminate the 
transaction.  13
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Operational Overview
MOG has a broad portfolio of production, development and exploration assets and a 
secure financial position. Revenues from gas sales are now providing a sound financial 
position going forward.
Over the next 12 months, MOG intends to progress its key assets and pursue attractive and 
material strategic growth opportunities that we expect to identify.
One of the strengths of the Company is the wide international experience of its senior 
managers, in particular in the Mediterranean area and the operational capability of its staff 
and organisation. This has been preserved during the critical period of financial uncertainty 
in 2011 and we believe that it is now a key strength for the ambitious growth objectives of 
the Group.
William Higgs Sergio Morandi
Chief Executive,  Chief Operating Officer
appointed 19 March 2012  (interim Chief Executive,  
up to 18 March 2012)
24 May 2012 24 May 2012
Qualified person:
In accordance with the guidelines of the AIM Market of the London Stock Exchange,  
Dr Bill Higgs, Chief Executive of Mediterranean Oil & Gas Plc, a geologist, explorationist  
and reservoir manager with over 23 years’ oil and gas industry experience, is the qualified 
person as defined in the London Stock Exchange’s Guidance Note for Mining and Oil and 
Gas companies, who has reviewed and approved the technical information contained in 
this announcement.
Glossary
Bcf Billion cubic feet of gas
Contingent oil/gas resources Has the meaning ascribed by the SPE/WPC Standard
MMbbls Million stock tank barrels of oil
MMscm Million standard cubic metres
P1 & P2 Reserves Proven plus probable reserves as defined in the SPE/WPC Standard
Prospective oil/gas resources Has the meaning ascribed by the SPE/WPC Standard
Scm Standard cubic metre
SPE/WPC Society of Petroleum Engineers/World Petroleum Congress
SPE/WPC Standard Definitions and methodology for certifying hydrocarbon reserves and 
resources adopted by the SPE/WPC from time to time which presently requires the application 
of the 2007 Petroleum Resources Management System standards
RRR Reserve Replacement Ratio
R/P Reserves to Production Ratio 14
Mediterranean Oil & Gas Plc Annual Report 2011 www.medoilgas.com
Financial review
2011 highlights
• New equity raised, post cash transaction expenses, €22.4m
• Cash and cash equivalents at year-end of €3.7m 
(2010: €2.8m)
• Financial liabilities at year-end €nil (2010: €20.4m)
• Group revenue from sales of gas and gas condensate €5.6m (2010: €3.5m)
• Group profit before tax of €2.8m (2010: €7 .8m loss)
Revenue
In 2011, gas and gas condensate 
production of 17 .6MM scm (0.62 Bcf) 
resulted in a 62% increase in operational 
revenues to €5.65m (2010: €3.49m). A 44% 
increase in gas production relative to the 
prior 12 month period (2010: 12.3 MM scm; 
0.43 Bcf) was primarily attributable to the 
commencement of gas production at the 
Guendalina offshore gas field in late 
October 2011. The average gas sales price 
realised in 2011 was €0.32/scm, or $12.7 per 
thousand cubic feet (2010: €0.28/scm or 
$10.7 per thousand cubic feet). This is 
reflected in the cash generated from 
operating activities which, at €1.05m, 
exceeds the previous year (2010: (€1.48m)).
Income From Operations
The loss from operations for 2011 was €1.7m 
(2010: loss of €5.5m). The reduced loss was 
primarily attributable to the combined 
effect of increased revenues in 2011 
relative to 2010, together with lower total 
administrative expenses of €5.7m 
(2010: €7 .5m).
The reduction in total administrative 
expenses arose from a lower impairment 
expense of €1.1m in the year (2010: €3.4m), 
which was largely attributable to an 
impairment provision of €586,000 for the 
Torrent Cigno concession (Masseria Vincelli 
1 and Torrente Cigno 4 wells) and €457 ,000 
for the Lucera concession (Reggente, Bastia 
and Santa Caterina fields).
Group Recapitalisation
On 21 April 2011, the Company announced 
its financial restructuring, which was 
completed on 10 May 2011 (‘Group 
Recapitalisation’). This transaction 
comprised the settlement of the credit 
facility held with the Bank of Scotland (‘BoS’) 
and conversion of all outstanding 
convertible bonds and loan notes to equity, 
eliminating approximately €20.4m in 
financial debt from the statement of 
financial position. At the same time, 
approximately €22.4m in new equity 
(post cash transaction expenses) was 
raised, with the Group having a net cash 
and cash equivalent position of €17 .5m, 
at 30 June 2011. 
Following completion of the Group 
Recapitalisation, the Group held no 
financial debt and held sufficient funds to, 
among other things, fund the Group’s 20% 
working interest in the Guendalina project, 
which first commenced gas production at 
the end of October 2011. MOG expects to 
remain in a sound funding position 
following full disbursement of capital 
expenditures required to complete the 
Guendalina field and the material increase 
in the Group’s revenues arising from the 
commencement of production at 
Guendalina.
Chris Kelsall
Finance Director 15
Mediterranean Oil & Gas Plc Annual Report 2011 www.medoilgas.com
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Net Profit
Total finance expense for the year was 
€1.7m (2010: €2.8m). No interest expense 
was incurred following the elimination in 
May of financial debt, as part of the Group 
Recapitalisation
Total finance income in the year was €6.2m 
(2010: €482,000). This was largely caused 
by a one-off finance gain of €5.7m on the 
settlement of financial liabilities, arising as 
part of the Group Recapitalisation. The 
foreign exchange income of €435,000 
arises predominantly from the translation 
of items held in foreign currencies to the 
Euro reporting currency of the financial 
statements.
Profit before tax was €2.8m (2010: loss 
€7.8m). Following the commencement of 
first gas at Guendalina, a deferred tax 
asset of €3.7m was recognised in the year 
with regard to tax losses brought forward. 
These are expected to be applied against 
taxable profits arising from future oil and 
gas production, most notably at the 
Guendalina gas field. As a consequence, 
the Group net profit after tax was €6.4m 
(2010: loss €7 .8m). 
The basic and diluted earnings per share 
was €0.02 per share (2010: loss of €0.20 
per share). No dividend is proposed to be 
paid for the year ended 31 December 2011 
(2010: €nil).
Cash Flow
Net Group cash inflow generated from 
operating activities was €1.0m (2010: 
€6,000 net outflow).
Prior to completion of the Group 
Recapitalisation in May 2011, the Group  
was required to reduce operational and 
exploration activity, except where this was 
considered to be essential to preserve the 
Group’s key assets.
Net cash investments in oil and gas assets 
in the year were €17 .8m (2010: €3.7m), the 
main elements comprising capital 
expenditure on the Guendalina project and 
the acquisition of 3D seismic data at Area 4 
Offshore Malta.
Net cash from financing activities was 
€17 .8m (2010: €575,000) and primarily 
comprised €22.7m gross cash proceeds 
received from the issuance of new equity 
(2010: €nil) and the payment of €3.9m  
(2010: €nil) for settlement of the BoS loan 
facility, both items forming part of the  
Group Recapitalisation.
Statement of Financial Position
Cash and cash equivalents at year-end 
were €3.7m (2010: €2.8m). Among 
non-current assets, key movements from 
2010 included property, plant and 
equipment at €20.5m (2010: €3.6m), 
primarily as a result of capital expenditure 
on the Guendalina project, and the 
recognition of a €3.7m deferred tax asset, 
following the commencement of first gas 
production at Guendalina.
Financial liabilities at year end were €nil 
(2010: €20.3m), following the Group 
Recapitalisation. The increase in provisions 
to €8.4m (2010: €6.7m) was primarily 
attributable to a new decommissioning 
provision (€1.2m) being made in the year 
following the commencement of production 
from the Guendalina gas field (see Note 19 
of the Financial Statements for further 
information).
At the end of 2011, net assets stood at 
€51.6m (2010: €11.8m), and non-current 
assets were €55.8m (2010: €35.2m).
Key Performance Indicators
The Group’s key financial performance 
indicators are revenue and consolidated 
result. Its key non-financial performance 
indicators are the level of production and 
reserve and resources replacement 
(discussed in the Chief Executive’s Report 
–Oil & Gas Reserves and Resources on 
page 10) and the health, safety and 
environmental performance (discussed  
in the Chief Executive’s Report – HSE, on 
page 12).
The share price movement during the 12 
month period to 31 December 2011 ranged 
from an intra-day high of 25.4p (prior to the 
Group Recapitalisation) to a low of 5.8p (post 
the Group Recapitalisation). The share price 
at close on 31 December 2010 was 6.1p.
Events after the Reporting Period
In November 2011, the Company entered 
into a short-term secured loan facility with 
affiliated investment funds of Och-Ziff 
Capital Management Group (‘Och Ziff’), for 
up to €3.5m (the ‘Loan Facility’). The purpose 
of the Loan Facility was to assist the 
Company in funding the acquisition and 
processing of 3D seismic exploration data 
at Area 4 Offshore Malta. 
Draw downs under the Loan Facility at  
31 December 2011 amounted to €nil 
(December 2010: €nil). Subsequent to the 
reporting date, on 7 February 2012, the 
Company borrowed €2.0m (the ‘Principal’) 
under the Loan Facility. Repayment of the 
entire Principal and accrued interest was 
completed on 26 April 2012 (For further 
information, refer to Notes 1, 25 and 26  
to the Financial Statements). 
Hedging
During 2011, the Group did not have any oil 
and gas price derivatives in place (2010: no 
oil and gas price derivatives in place).
Cautionary Statement
This financial report contains certain 
forward-looking statements that are 
subject to the usual risk factors and 
uncertainties associated with the oil and 
gas exploration and production business. 
While the Directors believe the expectation 
reflected herein to be reasonable in light of 
the information available up to the time of 
their approval of this report, the actual 
outcome may be materially different owing 
to factors either beyond the Group’s control 
or otherwise within the Group’s control but, 
for example, owing to a change of plan or 
strategy. Accordingly, no reliance may be 
placed on the forward-looking statements.
Chris Kelsall
Finance Director
24 May 2012 16
Mediterranean Oil & Gas Plc Annual Report 2011 www.medoilgas.com
Principal risks and uncertainties
The Group is subject to various risks and uncertainties, 
including those which derive from its oil and gas 
exploration, development and production activities. 
These risks and uncertainties may have a material 
impact on the Group’s performance and could cause 
future results to differ materially from expected and 
historical results
Health, Safety and Environment
The Group conducts operations in countries 
in Europe and the Mediterranean region. 
There is a risk of incidents in our operations 
that have the potential to impact the health 
and safety of staff, contractors, and 
communities, and/or the environment. Such 
incidents may have a negative impact on 
the Group’s reputation. This risk is mitigated 
through the implementation of the Group’s 
HSE management system, training of staff, 
and selection of contractors.
The Group is extremely conscious of the 
environmental risks that are inherent in  
the oil and gas industry. The Group  
ensures that all relevant environmental 
impact studies are undertaken in  
advance of any proposed seismic or other 
operations it undertakes and best-in-class 
industry environmental standards and 
practices are adopted by the Group in  
all of its operations. While the Group can 
never fully mitigate the cost, delays and 
other implications of future changes in 
environmental legislation and regulation, 
the Group establishes strong working 
relationships with the local authorities  
in the countries it operates to be best able 
to work through any potential significant 
changes that could arise in the future.
Funding and Financing
The nature of the Group’s business means 
that there are significant costs associated 
with seismic, drilling, and development 
campaigns. The Group manages this risk 
by a number of means. The Group closely 
monitors its cash position and each month 
produces updated cash flow forecasts to 
help it determine appropriate strategies to 
fund its short and medium-term 
operations. The Group also ensures that it 
always has adequate levels of cash on 
deposit, with varying terms of maturity, to 
match the items of expenditure as they 
become due. Further information on 
pricing, liquidity and credit risk is set out in 
Note 19 to the Financial Statements. 
The Group’s principal risks and 
uncertainties are set out below, together 
with a summary as to how they are 
mitigated. The relative importance of  
the risks faced by the Group is likely to 
change over time as the Group implements 
its growth strategy and as a consequence 
of external political, regulatory and 
macroeconomic developments.
Exploration 
There is no assurance that the Group’s 
exploration activities will identify a 
commercial discovery among the existing 
portfolio. The Group mitigates exploration 
risk through the experience and expertise 
of the Group’s specialists, the application  
of appropriate technology, and the 
selection of prospective exploration  
assets. The Group has an objective to 
acquire additional exploration assets, 
which will diversify exploration risk. 
Furthermore, the Group seeks to employ 
individuals and contractors with strong 
technical skills and experience in the areas 
in which it operates. Where appropriate, 
the Group works with joint venture partners 
who have demonstrable technical skills 
and experience in similar projects. Further 
information on exploration assets is set out 
in Note 5 to the financial statements.
Operations
The nature of oil and gas operations 
means that the Group is exposed to the  
risk of equipment failure, well blowouts,  
fire, pollution and bad weather. In order  
to mitigate these risks, the Group ensures 
that it implements recognised industry 
operating and safety standards, it has 
sufficient levels of industry-specific 
insurance cover and it only works with  
joint venture partners, operators and 
contractors who can demonstrate similar 
high standards of safety, operating and 
financial capability. 17
Mediterranean Oil & Gas Plc Annual Report 2011 www.medoilgas.com
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Currencies
The functional currency of the Company 
and its subsidiaries is the Euro and a 
significant proportion of its current portfolio 
of assets and near-term forecast revenue 
and expenditure is also in Euro. Certain 
expenditures are required to be funded in 
Pounds Sterling and US Dollars and the 
Group monitors its forecast expenditure 
profile and maintains sufficient levels of its 
cash resources in Pounds Sterling and US 
Dollars to pay these expenses. The Group 
does not believe, at this moment, it is 
particularly exposed to large currency 
fluctuations. The Group holds a significant 
proportion of its cash reserves with banks 
which have a minimum credit rating of A. 
Further information on currency risk is set 
out in Note 19 to the financial statements.
Regulation
Regulations may change with a 
consequential adverse effect on the 
Group’s exploration and production assets. 
Regulatory risk is mitigated by monitoring 
the regulatory and political environment 
within the countries in which the Group 
holds assets, engaging in constructive 
dialogue where and when appropriate, 
and introducing third-party expertise if this 
may assist in resolution of issues affecting 
the Group’s assets. The Group has an 
objective to acquire additional assets both 
for the exploration and production portfolio, 
which may assist in diversifying country-
specific regulatory risk.
Risk Management
The Directors regularly monitor the principal 
and other related risks, using information 
obtained or developed from external and 
internal sources, and will take action as 
appropriate to mitigate the Group’s 
exposure. The main elements of the risk 
management system include regular 
Board review of the business, a defined 
process for preparation and approval of  
the annual work programme and budget, 
ethical and anti-bribery procedures, and 
HSE management systems.
The Group reviews its business risks and 
management systems on a regular basis 
and, through this process, the Directors 
have identified the principal risks. The 
Group manages some risks by maintaining 
a portfolio of projects and ensuring the 
Group is in compliance with the terms of all 
its agreements, through the application of 
appropriate policies and procedures and 
via the recruitment and retention of a team 
of skilled and experienced professionals. 18
Mediterranean Oil & Gas Plc Annual Report 2011 www.medoilgas.com
1.
2. 4.
3. 5. 7.
8.
9.
6.
Board of Directors 19
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3. Mr. Sergio Morandi
Chief Operating Officer
Mr. Morandi was Chief Executive of the 
Company from late 2007 to May 2011. 
He has 31 years’ experience in oil & gas 
geophysics, exploration, development, 
production, operations and E&P business 
management. He has worked at ENI, 
Coparex, ELF, Enterprise Oil, Shell Italia E&P 
and Shell International E&P . From 1997 to 
2003, he was professor of Applied 
Seismology at Basillicata University in Italy 
and since 2002 he is a board member of the 
Italian National Upstream Association 
(Associazione Mineraria Italiana). Sergio 
holds a First Class Honours Degree in 
Geological Science from the University of 
Rome and is a registered Geologist in Italy.
4. Mr. Chris Kelsall
Finance Director
Mr. Kelsall, appointed as Finance Director  
of Mediterranean Oil & Gas Plc in July 2009, 
has spent most of his career in investment 
banking, advising clients in relation to capital 
markets, privatisation and corporate finance 
projects in a wide range of developed and 
emerging markets. Most recently he was a 
Director, equity capital markets at Deutsche 
Bank. Mr. Kelsall initially practised as a 
commercial and corporate solicitor in 
Australia from 1991–1994, with firms within  
the Allens Arthur Robinson legal group.  
Mr Kelsall holds a Master of Finance 
(Distinction) from London Business School,  
a Bachelor of Economics and a Bachelor of 
Laws from the University of Western Australia, 
and a Graduate Diploma in Applied Finance 
and Investment from the Securities Institute 
of Australia.
5. Mr. Matthew Clarke
Non-Executive Director
Mr. Clarke is a founding partner of Merlin 
Partners LLP , an FSA registered corporate 
finance firm specialising in the natural 
resource sector. He is a qualified English 
lawyer and spent the years 1988–1995 at 
Linklaters. From 1995–2001 he was at Robert 
Fleming & Co Limited, where he was a 
director, specialising in equity capital markets. 
He established Merlin Partners in 2002 and 
sits on the boards of a number of private 
natural resource companies.
6. Mr. Miles Donnelly
Non-Executive Director
Mr. Donnelly founded Aurelian Oil & Gas Plc 
together with Michael Seymour as a private 
company in 2002, which was subsequently 
listed on AIM in 2006. Miles stepped down  
as a director of Aurelian Oil & Gas Plc in June 
2010 and subsequently formed Trajan Oil & 
Gas Limited to explore in the Eastern 
Mediterranean. He has worked extensively  
in Africa and the Middle East.
1. Mr. Keith Henry
Non-Executive Chairman
Mr. Keith Henry, appointed as Chairman of 
Mediterranean Oil & Gas Plc in January 2012, 
has a wealth of experience gained over more 
than 35 years in the development, design, 
construction and management of projects 
and major companies in the oil and gas, 
power and service industries. During this 
period he was chief executive of National 
Power plc, a FTSE 100 company, Brown & Root 
Limited, and Kvaerner Engineering & 
Construction Limited. As a non-executive 
director within the oil and gas sector, Keith 
has held the roles of chairman of Burren 
Energy plc, director of First Calgary Petroleums 
Limited, senior independent director of 
Emerald Energy plc, deputy chairman of 
Petroleum Geo-Services ASA, chairman of 
Petrojarl ASA, and a director of Enterprise Oil 
plc. Outside of the oil and gas sector, Keith 
has held a number of other non-executive 
roles, including chairman of Helius Energy plc, 
director of South East Water Ltd, and deputy 
chairman of Aegis Defence Services Limited. 
Keith is currently the chairman of Regal 
Petroleum plc, the senior independent 
director of Sterling Energy plc and a non-
executive director of HPR Holdings Limited. A 
BSc graduate from the University of London 
and holding an MSc from Birmingham 
University, Keith is a Fellow of the Institution of 
Civil Engineers, and a Fellow of the Royal 
Academy of Engineering.
2. Mr. Bill Higgs
Chief Executive
Bill Higgs has over 23 years of global 
exploration, development and operations 
experience working with Chevron. Most 
recently he was senior vice president of 
Operations for Saudi Arabian Chevron (‘SAC’) 
in Saudi Arabia/Kuwait. In his role, Bill was the 
senior operations representative for SAC that, 
jointly with Kuwait Gulf Oil Company, operates 
exploration, development and production 
activities for the onshore Partitioned Zone 
shared by the Kingdom of Saudi Arabia and 
Kuwait. Prior to this, Bill was chief strategist for 
Chevron Corporation and the secretary of the 
Corporate Strategy and Planning Committee, 
where he facilitated strategic dialogue and 
strategy setting with Chevron’s executive 
leaders. Bill’s previous roles at Chevron 
include manager of Reservoir Management 
for Tengizchevroil in Kazakhstan, asset 
manager for the BBLT development in Angola, 
business development and planning 
manager for Sasol Chevron in Australia, 
geology manager for WAPET Exploration in 
Australia, senior researcher for Chevron’s 
research company in California, and lead 
exploration and development geologist for 
Chevron UK. Bill is a BSc graduate in 
Geological Science from the University of 
Leeds and holds a PhD in Structural Geology 
from the University of Wales.
7 . Mr. Salvatore Russo
Non-Executive Director
Mr. Russo holds a degree in Chemical 
Engineering and he began his career with 
Mobil (USA). In 1981 Mr Russo joined ENI  
S.p.A (State Energy Board). As director of 
Group Strategy and Planning he contributed 
to the entire re-organisation of the ENI Group 
and also participated in the privatisation  
of ENI. Over a period of some 20 years,  
Mr Russo has held very senior positions  
on the boards of some of Italy’s largest 
corporations including, amongst others, 
chairman and CEO Saipem S.p.A, chairman 
and CEO Snam S.p.A, chairman, CEO Snam 
Rete Gas S.p.A (ENI Group) and chairman and 
CEO EnerTAD S.p.A. In addition, he has served 
on the boards of directors of a number of 
companies including Agip, AgipPetroli, 
EniChem and Italgas.
8. Mr. Michael Seymour
Non-Executive Director
Mr. Seymour is a geologist with over 40 years 
of experience in the oil industry, starting with 
the Burmah Oil Company, Conoco and 
Kerr-McGee. Mr Seymour was the Founder  
of Aurelian Oil & Gas Plc, where he was 
managing director until mid-2009.  
Mr. Seymour retired as Non-Executive Director 
in May 2011. He was also founder of Teredo 
Petroleum Plc in 1984 and Medusa Oil & Gas 
Ltd in 1991. He is a former chairman of both 
the Petroleum Exploration Society of Great 
Britain and the UK Onshore Operators Group. 
Currently, he is president of the Polish 
Exploration and Production Industry 
Organisation and a director of Trajan  
Oil Limited. 
9. Mr. Jake Ulrich
Non-Executive Director
Jake was senior energy advisor to Och Ziff 
Management Europe Ltd from 2008–2011. 
Prior to this role, he was an executive director 
with Centrica plc until 2008, responsible for 
upstream, power generation, renewables 
and trading. Prior to joining Centrica he was 
an executive at NGCH (later Dynergy) and also 
worked for the OXY/MidCon/Peoples Group. 
Jake has a degree in Engineering from the 
University of Maryland and an MBA from the 
University of Chicago. 20
Mediterranean Oil & Gas Plc Annual Report 2011 www.medoilgas.com
Senior management
Gian Paolo Musu
Head of Operations, Production & 
Development
Mr. Musu is a petroleum engineer with 
8 years’ previous experience working on 
international oil and gas business projects 
with Total Italia E&P . He has particular 
experience relating to field and drilling 
operations, maintenance, inspections, spare 
parts, refineries and production facilities. 
Cinzia Salemme
Commercial and Management Control 
Co-ordinator
Prior to joining the Group in 2008,  
Ms Salemme had 15 years’ of broad  
industry experience in financial and 
commercial analysis, strategic business 
support and financial control. She is currently 
responsible for the negotiation of commercial 
contracts, including the Group’s gas sales 
agreements. Ms. Salemme holds a diploma 
in accounting, from the Vittorio Veneto 
Commercial Technical Institute.
Paolo Carugno
Technical & Portfolio Manager
Mr. Carugno is a geologist and joined MOG 
from ENI, where he worked for approximately 
28 years in oil and gas exploration and 
production activities. Mr. Carugno has 
extensive experience as an exploration 
geologist in Italy, the Mediterranean basin, 
Africa and in the Caspian region. While at ENI, 
he held several positions and in particular, 
was new venture and exploration project 
manager in Egypt and co-ordinator of the 
reserves validation team of worldwide 
exploration discoveries.
Lorenzo Lipparini
Head of Geosciences
Mr. Lipparini has over 16 years of international 
experience in oil & gas exploration and 
production activities, focused on geophysical 
disciplines, seismic interpretation and 
reservoir characterisation. He has worked 
with ENI in Italy, Gabon, Indonesia and the 
USA. He holds a master’s degree in Geology.
Floriana Brucia
Head of Accounting and Finance
Ms. Brucia has over 19 years’ experience in 
the international oil and gas business. She 
has worked for various E&P companies which 
include Lasmo UK and Lasmo Mineraria Spa 
Italy, Forest Oil (USA), Vega Oil (CYGAM Group 
– Canada) , Grove Energy (Stratic Energy 
Group – UK) covering various roles in 
administration and finance. She holds a 
master’s diploma in accounting, marketing 
and communication science.
Antonello Rubino
Head of Health, Safety and the Environment
Mr. Rubino is an Environmental Engineer 
with more than 10 years of experience 
working in Health, Safety and the 
Environment. He has particular expertise  
on hazard recognition and assessment, 
emergency procedures, hydrogen sulphide 
emissions, gas detection, personal 
protection equipment, transportation and 
management of hazardous wastes and  
the conduct of HSE compliance audits and 
reporting. Mr. Rubino previously worked for 
2 years with Saipem (ENI Group) as the HSE 
supervisor, for both onshore and offshore 
hydrocarbon E&P projects. 21
Mediterranean Oil & Gas Plc Annual Report 2011 www.medoilgas.com
BUSINESS
REVIEW
CORPORATE
GOVERNANCE
FINANCIAL
STATEMENTS
Directors’ report 
For the year ended 31 December 2011
The Directors present their Annual Report together with the audited 
Financial Statements for the year ended 31 December 2011.
Principal Activities 
The principal activities of the Group are oil and gas exploration, 
development and production. The Group has its head office in 
London and has oil and gas interests in Italy, Malta and France. 
The head office for operations is located in Rome, with a further 
regional base in Foggia, Italy. Subsidiary undertakings are set out in 
Note 12 to the Financial Statements.
Results and Proposed Dividend
The Group profit for the year was €6.4m (2010: loss of €7 .8m). This 
results in Group Retained Losses of €13.8m (2010: €20.4m) to be 
carried forward. The Directors do not recommend the payment of a 
dividend (2010: €nil).
Policy and Practice on the Payment of Creditors
While no formal code is adopted, the Group’s current policy 
concerning the payment of its creditors is to:
•	 settle the terms of payment with creditors when agreeing the 
terms of each transaction
•	 ensure that these creditors are made aware of the terms of 
payment by the inclusion of relevant terms in contracts
•	 pay in accordance with contractual and other legal obligations
At the reporting date, the Company’s creditor payment days are 60 
days (2010: 60 days).
Business Review
The Company is required by the Companies Act 2006 to include a 
review of the business and likely future developments. This 
information is contained in the Chairman’s Statement, Chief 
Executive’s Report and the Finance Review on pages 6 to 15.
Capital Structure
The capital structure of the Company was significantly impacted by 
the Group Recapitalisation in May 2011. Details of the issued share 
capital, together with details of the movements in the Company’s 
issued share capital during the year are shown in Notes 20, 24 and 
25 to the Financial Statements. The Company has one class of 
ordinary shares which carry no right to fixed income. Each share 
carries the right to one vote at general meetings of the Company. In 
addition, following the Group Recapitalisation, the Company has 
one class of deferred shares, which do not entitle the holder to 
receive any dividend or other distribution, or to vote at general 
meetings of the Company.
There are no specific restrictions on the size of a holding nor on the 
transfer of shares, which are both governed by the general 
provisions of the articles of association and prevailing legislation. 
The Directors are not aware of any agreements between holders of 
the Company’s shares that may result in restrictions on the transfer 
of securities or on voting rights.
Details of share-based payments are set out in Note 22 to the 
Financial Statements.
No person has any special rights of control over the Company’s 
share capital and all issued shares are fully paid. 
Going Concern
The Group’s business activities, together with the factors likely to 
affect its future development, performance and position, are set out 
in the Chief Executive’s Report. The financial position of the Group, 
its cash flows and liquidity position are described in the Finance 
Review. The main risks encountered by the Group are set out in 
Principal Risks and Uncertainties. In addition, Note 18 to the 
Financial Statements includes the Group’s objectives, policies 
and processes for managing its capital and financial risk, details 
of its financial instruments and its exposures to credit risk and 
liquidity risk. 
The Group expects to generate sufficient cash from operations for 
its working capital needs and its committed capital expenditure 
programme for at least the next 12 months. As a consequence, 
the Directors believe that the Group is well placed to manage its 
business risks successfully despite the current uncertain 
economic outlook.
The Directors have a reasonable expectation that the Group will 
generate adequate cash from operations to continue in operational 
existence for the foreseeable future. Accordingly, they continue to 
adopt the going concern basis in preparing the Annual Report and 
Financial Statements.
Post Reporting Date Events
Post reporting date events are described in Note 26 to the Financial 
Statements.
Directors
The Directors who held office during the year and subsequently 
were as follows:
Date appointed Date resigned
K Henry 16 January 2012 –
W Higgs 19 March 2012 –
M Bonte-Friedheim – 11 November 2011
A Cochran 10 May 2011 31 October 2011
P Clutterbuck – 9 May 2011
S Morandi – –
C Kelsall – –
S Russo – –
M Seymour 10 May 2011 –
M Donnelly 10 May 2011 –
M Clarke 13 October 2011 –
J Ulrich 16 January 2012 –
Biographical details of serving Directors can be found in the Board 
of Directors section of this Annual Report.
Directors Election and Rotation
With regard to the appointment and replacement of Directors, the 
Company is governed by its articles of association, the Companies 
Act and related legislation. The articles themselves may be 
amended by special resolution of the shareholders.
In accordance with article 23.2 of the Company’s articles of 
association, Matthew Clarke, Keith Henry, William Higgs and Jacob 
Ulrich will retire from office and offer themselves for election at the 
forthcoming Annual General Meeting (‘AGM’) on 26 June 2012. 22
Mediterranean Oil & Gas Plc Annual Report 2011 www.medoilgas.com
Directors Interests
The Directors who held office at the end of the financial year and 
subsequently had the following interests in the ordinary shares and 
options of the Company:
Interest at date of 
this report
31 December 
2011
31 December 
2010
K Henry 750,000 n/a n/a
W Higgs – n/a n/a
S Morandi – – –
C Kelsall 333,333 333,333 –
S Russo – – –
M Seymour 17,906,667 17,906,667 n/a
M Donnelly 18,816,667 18,231,667 n/a
M Clarke 5,000,000 3,900,000 n/a
J Ulrich – n/a n/a
None of the Directors who held office at the end of the financial year 
had any disclosable interest in the shares of other Group 
companies. No rights to subscribe for shares in or debentures of 
Group companies were granted to any of the Directors or their 
associates, or exercised by them, during the financial year. 
Beneficial shareholdings include the shareholdings of a Director’s 
spouse or associates.
Substantial Shareholders
As of the date of this report, the Company has been notified of the 
following interests of 3% or more in its issued share capital:
Substantial shareholder Number of shares
Percentage of issued  
ordinary share capital
Och-Ziff Capital 
Management Group 125,000,000 29.1%
Stark Select Asset 
Master Limited 32,444,594 7.6%
Miles Donnelly 18,816,667 4.4%
Michael Seymour 17,906,667 4.2%
Directors’ Responsibilities
The directors are responsible for preparing the director’s report and 
the financial statements in accordance with applicable law and 
regulations. 
Company law requires the directors to prepare financial statements 
for each financial year. Under that law the directors have elected to 
prepare the group and company financial statements in 
accordance with International Financial Reporting Standards (IFRSs) 
as adopted by the European Union. Under company law the 
directors must not approve the financial statements unless they are 
satisfied that they give a true and fair view of the state of affairs of 
the group and company and of the profit or loss of the group for 
that period. The directors are also required to prepare financial 
statements in accordance with the rules of the London Stock 
Exchange for companies trading securities on the Alternative 
Investment Market. 
In preparing these financial statements, the directors are required 
to:
•	 select suitable accounting policies and then apply them 
consistently;
•	 make judgements and accounting estimates that are 
reasonable and prudent;
•	 state whether they have been prepared in accordance with 
IFRSs as adopted by the European Union, subject to any material 
departures disclosed and explained in the financial statements;
•	 prepare the financial statements on the going concern basis 
unless it is inappropriate to presume that the company will 
continue in business.
The directors are responsible for keeping adequate accounting 
records that are sufficient to show and explain the company’s 
transactions and disclose with reasonable accuracy at any time the 
financial position of the company and enable them to ensure that 
the financial statements comply with the requirements of the 
Companies Act 2006. They are also responsible for safeguarding 
the assets of the company and hence for taking reasonable steps 
for the prevention and detection of fraud and other irregularities.
Political and Charitable Contributions
During the year the Group made no charitable donations (2010: 
€nil) and no political contributions (2010: €nil).
Statement of Disclosure to Auditors
Each of the persons who is a Director at the date of approval of this 
Annual Report confirms that:
•	 so far as the Director is aware, there is no relevant audit 
information of which the Company’s Auditors are not informed
•	 the Director has taken all steps required to make himself aware 
of any relevant audit information and to establish that the 
Company’s Auditors are informed of that information
This confirmation is given and should be interpreted in accordance 
with the provisions of s418 of the Companies Act 2006.
Website Publication
The directors are responsible for ensuring the annual report and 
the financial statements are made available on a website. Financial 
statements are published on the company’s website in accordance 
with legislation in the United Kingdom governing the preparation 
and dissemination of financial statements, which may vary from 
legislation in other jurisdictions. The maintenance and integrity of 
the company’s website is the responsibility of the directors. The 
directors’ responsibility also extends to the ongoing integrity of the 
financial statements contained therein.
Auditors
BDO LLP have expressed their willingness to continue as Auditors 
and a resolution to reappoint them will be proposed at the Annual 
General Meeting.
By order of the Board
Chris Kelsall
Finance Director
24 May 2012 
Directors’ report continued
For the year ended 31 December 2011 23
Mediterranean Oil & Gas Plc Annual Report 2011 www.medoilgas.com
BUSINESS
REVIEW
CORPORATE
GOVERNANCE
FINANCIAL
STATEMENTS
Corporate governance statement
Companies on the AIM Market of the London Stock Exchange are 
not required to comply with the 2010 UK Corporate Governance 
Code and due to its size, the Company is not in full compliance. 
While the Company is not required to present a Corporate 
Governance Statement, as it is not subject to the Listing rules of the 
Financial Services Authority, it has disclosed here certain 
information in respect of Corporate Governance.
The Directors, however, support high standards of corporate 
governance and intend that the Company will comply with the 
provisions of the 2010 UK Corporate Governance Code in so far 
as it is practicable for a company of its size. In addition, the 
Directors will progressively adopt best practices in line with the 
2010 UK Corporate Governance Code on Corporate Governance, 
so far as is practicable.
Board of Directors
The Company at the date of the Directors’ Report, has appointed six 
Non-Executive Directors (including the Company’s Chairman) with 
relevant sector experience to complement the three Executive 
Directors and to provide an independent view to the Board. The 
composition of the Board ensures that no one individual or group 
dominates the decision-making process.
The Board is responsible to the shareholders for setting the 
direction of the Company through the establishment of strategic 
objectives and key policies. The Board meets on a regular basis 
and considers issues of strategic direction, approves major capital 
expenditure, appoints and monitors senior management and any 
other matters having a material effect on the Company. 
The Board receives regular detailed financial and operational 
reports from senior management to enable it to carry out its duties. 
Each Director is entitled to independent professional advice at the 
Company’s expense provided that the prior approval of the 
Chairman is obtained. All Directors have unrestricted access to 
management and to such Company information as is needed to 
carry out their duties and responsibilities fully and effectively. 
All Directors are subject to election by shareholders at the first 
opportunity following their appointment. In addition, Directors will 
retire by rotation and stand for re-election by shareholders at least 
once every three years in accordance with the Company’s articles 
of association. The composition of the Board is reviewed from time 
to time to ensure that it has an appropriate balance of experience 
and expertise.
Board Committees
The Board may establish committees to assist it in carrying out its 
responsibilities in an effective and efficient manner. The current 
Board committees are the Audit Committee and the Remuneration 
Committee. The Directors do not consider that, given the size of the 
Board, it is appropriate to have a Nominations Committee. The 
appropriateness of such a committee will, however, be kept under 
regular review by the Company.
Audit Committee
The Audit Committee meets not less than twice a year and 
considers the Company’s financial reporting (including accounting 
policies) and internal financial controls. Meetings are normally 
attended, by invitation, by the Finance Director and a representative 
of the Auditors. The Audit Committee presently comprises Michael 
Seymour (Chairman) and Salvatore Russo.
Remuneration Committee
The Remuneration Committee comprises two Non-Executive 
Directors and is responsible for establishing and developing the 
Company’s general policy on executive, senior management and 
employee remuneration and determining specific remuneration 
packages for Executive Directors. The Remuneration Committee 
presently comprises: Salvatore Russo (Chairman) and Miles 
Donnelly. The Remuneration Committee meets at least once a year.
Internal Control
The Directors are responsible for the Group’s system of internal 
control and reviewing its effectiveness. Any such system is 
designed to manage rather than eliminate the risk of failure to 
achieve business objectives and can only provide reasonable and 
not absolute assurance against material misstatement or loss. 
Internal controls and business risks were monitored in the course 
of 2011 through regular Board meetings.
Communication with Shareholders
The Board recognises that it is accountable to shareholders for 
the performance and activities of the Group. The Annual Report 
together with other information about the Group is available on 
the Group’s website at www.medoilgas.com 24
Mediterranean Oil & Gas Plc Annual Report 2011 www.medoilgas.com
Remuneration report
For the year ended 31 December 2011
The Remuneration Committee (the ‘Committee’) is comprised of 
Salvatore Russo (Chairman) and Miles Donnelly. The Committee is 
responsible for determining and making recommendations to the 
Board on the structure and overall remuneration package for 
Executive Directors and reviews the remuneration for the 
Company’s senior employees. It is responsible for determining 
individual remuneration packages including, where appropriate, 
bonuses, incentive payments and share options. 
The remuneration of the Non-Executive Directors is set by the Board 
on the basis of a proposal prepared by the Remuneration 
Committee. No Director may participate in any meeting at which 
discussion or any decision regarding his own remuneration takes 
place. The Remuneration Committee also administers the 
Company’s share option scheme. The Committee keeps itself fully 
informed of all relevant developments and best market practice in 
the field of remuneration.
The Remuneration Committee is permitted to appoint independent 
advisors to assist in the determination of the remuneration.
Remuneration Policy
The Committee, in forming its policy on remuneration, has given 
due consideration to the needs of the Company, the shareholders 
and the provisions of the 2010 UK Corporate Governance Code (the 
‘Code’). The ongoing policy of the Committee is that the overall 
remuneration package should be sufficiently competitive to attract, 
retain and motivate high quality employees capable of achieving 
the Group’s objectives and to incentivise them effectively, so as to 
deliver long-term shareholder value.
It is the aim of the Committee to reward key employees on a basis 
which is linked, to a significant extent, to the performance of the 
individual and of the Company. Also, the remuneration is subject to 
the broader principle that their remuneration should be competitive 
with that received by professionals of comparable companies.
There are four main elements of the remuneration package:
•	 Base salary
•	 Employee benefits
•	 Performance-related bonus
•	 Long-term share options
Base Salary
The policy is to pay a fair and reasonable base salary, taking into 
account comparative salaries for similar roles in similar companies. 
The base salary is reviewed annually by the Committee having 
regard to the performance of the Company, individual 
performance, market data, levels of increases applicable to other 
employees of the Company and economic conditions. The most 
recent salary review for Executive Directors was implemented on 
1 January 2012.
Employee Benefits
Sergio Morandi receives a car and fuel allowance. In 2011, no 
payments were made to personal pension schemes for or on 
behalf of the Executive Directors.
The Company provides the Company’s Directors and Officers with 
third party indemnity insurance.
Bonus Arrangements
Performance bonuses may be awarded to the Company’s 
employees and Executive Directors by the Board, upon 
recommendation by the Remuneration Committee. Bonus 
payments are not pensionable. Details of Directors’ remuneration 
paid in the year under review are set out in Note 10 to the Financial 
Statements.
Long Term Share Option Scheme
On 11 March 2010, the Board approved implementation of a new 
Global Share Option Plan (the ‘Plan’). No options were granted 
under the Plan in 2011. 
Following a recommendation of the Remuneration Committee, on 
19 January 2012, 13,500,000 options were granted under the Plan to 
the employees and Directors over ordinary shares of the Company.
On 19 March 2012, 6,000,000 options were granted under the Plan 
to William Higgs over ordinary shares of the Company. Details of 
the terms of the options awarded to Directors and employees 
under the Plan are set out in Note 26 to the Financial Statements.
The grant of options to Directors under the Plan in 2012 was as 
follows:
Director
New options  
granted in 2012
Total number of options held  
at the date of this report
William Higgs 6,000,000 6,000,000
Sergio Morandi 2,500,000 3,415,000
Chris Kelsall 2,000,000 2,090,000
Keith Henry 2,000,000 2,000,000
Matthew Clarke 1,000,000 1,000,000
Salvatore Russo 1,000,000 1,000,000
Miles Donnelly 1,000,000 1,000,000
Michael Seymour 1,000,000 1,000,000
Jacob Ulrich 1,000,000 1,000,000 25
Mediterranean Oil & Gas Plc Annual Report 2011 www.medoilgas.com
BUSINESS
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CORPORATE
GOVERNANCE
Directors Remuneration      
The remuneration of the Directors for the year ended 31 December 2011, payable by Group companies was as follows:
Fees and 
basic salary 
(€’000)
Settlement
and
Compromise
Payments
(€’000)
Bonus 
(€’000)
Benefits in Kind 
(€’000)
Total 
2011 
(€’000)
Total 
2010 
(€’000)
Executive Directors
M Bonte-Friedheim (resigned 11 November 2011) 93 108 – – 201 112
S Morandi 177 – 100 3 280 178
C Kelsall 163 – 75 – 238 156
Non-Executive Directors
A Cochran (appointed 10 May 2011; resigned 31 October 2011) 64 – – – 64 –
S Russo 30 – – – 30 30
P Clutterbuck (resigned 9 May 2011) 14 – – – 14 22
M Seymour (appointed 10 May 2011) 22 – – – 22 –
M Donnelly (appointed 10 May 2011) 22 – – – 22 –
M Clarke (appointed 13 October 2011) 11 – – – 11 –
Aggregate Remuneration 2011 (€’000) 596 108 175 3 882 –
Aggregate Remuneration 2010 (€’000) 495 – – 3 – 498
Non-Executive Directors
All Non-Executive Directors, including the Chairman, have contracts for services, setting out the terms and conditions of their appointment, 
which are terminable upon the provision of 3 months’ written notice by either party. Their remuneration is determined by the Board upon 
recommendation of the Remuneration Committee. Save for the fees received under the letters of appointment, options awarded under the 
Plan and reimbursement of reasonable expenses incurred in the discharge of their duties, the Non-Executive Directors are not entitled to 
any other benefits or arrangements.
Salvatore Russo
Chairman, 
Remuneration Committee
24 May 2012
FINANCIAL
STATEMENTS 26
Mediterranean Oil & Gas Plc Annual Report 2011 www.medoilgas.com
We have audited the financial statements of Mediterranean Oil & Gas Plc for the year ended 31 December 2011 which comprise the 
consolidated statement of comprehensive income, consolidated and company statement of changes in equity, consolidated and company 
statement of financial position, consolidated and company statement of cash flows, and the related notes. The financial reporting 
framework that has been applied in their preparation is applicable law and International Financial Reporting Standards (IFRSs) as adopted 
by the European Union and, as regards the parent company financial statements, as applied in accordance with the provisions of the 
Companies Act 2006. 
This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our 
audit work has been undertaken so that we might state to the company’s members those matters we are required to state to them in an 
auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other 
than the company and the company’s members as a body, for our audit work, for this report, or for the opinions we have formed.
Respective responsibilities of directors and auditors
As explained more fully in the statement of directors’ responsibilities, the directors are responsible for the preparation of the financial 
statements and for being satisfied that they give a true and fair view. Our responsibility is to audit and express an opinion on the financial 
statements in accordance with applicable law and International Standards on Auditing (UK and Ireland). Those standards require us to 
comply with the Auditing Practices Board’s (APB’s) Ethical Standards for Auditors. 
Scope of the audit of the financial statements
A description of the scope of an audit of financial statements is provided on the APB’s website at www.frc.org.uk/apb/scope/private.cfm. 
Opinion on financial statements
In our opinion: 
•	 the financial statements give a true and fair view of the state of the group’s and the parent company’s affairs as at 31 December 2011 and 
of the group’s profit for the year then ended;
•	 the group financial statements have been properly prepared in accordance with IFRSs as adopted by the European Union;
•	 the parent company financial statements have been properly prepared in accordance with IFRSs as adopted by the European Union 
and as applied in accordance with the provisions of the Companies Act 2006; and
•	 the financial statements have been prepared in accordance with the requirements of the Companies Act 2006.
Emphasis of matter – Ombrina Mare
In forming our opinion on the financial statements, which is not modified, we have considered the adequacy of the disclosures made in 
note 5 to the financial statements concerning the carrying value of the Ombrina Mare asset, which is recorded in the financial statements 
for the year ended 31 December 2011 at €17 .9m. The uncertainty surrounding the application and relevance of Legislative Decree June no. 
128/2010 to the Ombrina Mare asset has yet to be resolved by the Italian Government and therefore a material uncertainty as to the 
potential impact of the legislation on the carrying value of the Ombrina Mare asset exists. In the absence of definitive opinion on the 
impact of the legislative decree the directors have not recognised any provision for impairment against the carrying value of the Ombrina 
Mare asset.
Opinion on other matters prescribed by the Companies Act 2006
In our opinion the information given in the directors’ report for the financial year for which the financial statements are prepared is 
consistent with the financial statements. 
Matters on which we are required to report by exception
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:
•	 adequate accounting records have not been kept by the parent company, or returns adequate for our audit have not been received 
from branches not visited by us; or
•	 the parent company financial statements are not in agreement with the accounting records and returns; or
•	 certain disclosures of directors’ remuneration specified by law are not made; or
•	 we have not received all the information and explanations we require for our audit.
Anne Sayers
(senior statutory auditor)
For and on behalf of BDO LLP , statutory auditor
London
United Kingdom
24 May 2010
BDO LLP is a limited liability partnership registered in England and Wales (with registered number OC305127).
Independent auditor’s report
To the members of Mediterranean Oil & Gas Plc 27
Mediterranean Oil & Gas Plc Annual Report 2011 www.medoilgas.com
BUSINESS
REVIEW
CORPORATE
GOVERNANCE
FINANCIAL
STATEMENTS
Note
2011 
€’000
2010 
€’000
Revenue 7 5,649 3,488
Cost of sales (1,850) (2,021)
Gross profit 3,799 1,467
Other income 258 554
Administrative expenses
 Depreciation, depletion and amortisation (1,395) (1,179)
 Impairment (1,086) (3,388)
 Other administrative expenses (3,236) (2,935)
Total administrative expenses (5,717) (7,502)
Loss from operations 8 (1,660) (5,481)
Finance expense 2 (1,698) (2,784)
Finance income 2 6,192 482
Profit/(loss) before tax 2,834 (7,783)
Tax credit/(expense) 11 3,598 (37)
Profit/(loss) for the year and total comprehensive income attributable to the equity holders of the 
parent 6,432 (7,820)
Earnings/(loss) per share attributable to the equity holders of the parent
– Basic and diluted 3 € 0.02 €(0.20)
The notes on pages 34 to 56 form part of these financial statements.
Consolidated statement of comprehensive income
For the year ended 31 December 2011 28
Mediterranean Oil & Gas Plc Annual Report 2011 www.medoilgas.com
Share Capital 
€’000
Deferred 
shares 
€’000
Share 
premium 
€’000
Contributed 
equity reserve 
€’000
Warrant and 
share option 
reserve 
€’000
Convertible 
debt reserve 
€’000
Retained 
Deficit 
€’000
Total 
€’000
Group
At 1 January 2010 11,285 – 20,053 – 723 68 (12,701) 19,428
Total comprehensive loss for the year – – – – – – (7,820) (7,820)
Share-based payments – – – – 217 – – 217
Lapse of options – – – – (81) – 81 –
As at 31 December 2010 11,285 – 20,053 – 859 68 (20,440) 11,825
Total comprehensive income for the year – – – – – – 6,432 6,432
Shares issued – fundraising (net of issue 
costs) 4,025 – 18,327 – – – – 22,352
Shares issued – settlement of convertible 
debt 469 – 2,331 8,111 – (68) 68 10,911
Share consolidation (10,721) 10,721 – – – – – –
Share-based payment – – – – 39 – – 39
Lapse of options – – – – (169) – 169 –
As at 31 December 2011 5,058 10,721 40,711 8,111 729 – (13,771) 51,559
The following describes the nature and purpose of each reserve within owners’ equity:
Reserve Description and purpose
Share capital Amount subscribed for ordinary share capital at nominal value.
Share premium Amount subscribed for share capital in excess of nominal value.
Contributed equity reserve An amount representing equity contributed directly by shareholders. 
Warrant and share option reserve
Cumulative fair value of warrants and options, adjusted for transfers 
on exercise of share options and warrants.
Convertible debt reserve Equity component of convertible bonds.
Retained deficit
Cumulative net gains and losses recognised in the consolidated 
income statement, adjusted for transfers on exercise of share options.
Deferred shares
Amount representing ordinary 19p shares following split of shares as 
part of recapitalisation exercise.
The notes on pages 34 to 56 form part of these financial statements.
Consolidated statement of changes in equity
For the year ended 31 December 2011 29
Mediterranean Oil & Gas Plc Annual Report 2011 www.medoilgas.com
BUSINESS
REVIEW
CORPORATE
GOVERNANCE
FINANCIAL
STATEMENTS
Note
2011 
€’000
2010
€’000
Assets
Non-current assets
Property, plant and equipment 4 20,500 3,597
Exploration and evaluation assets 5 30,848 29,557
Available for sale investment 13 34 34
Other receivables 15 699 1,988
Deferred tax asset 11 3,742 –
Total non-current assets 55,823 35,176
Current assets
Inventories 14 2,533 2,603
Trade and other receivables 15 8,414 3,918
Cash and cash equivalents 21 3,703 2,810
Total current assets 14,650 9,331
Total assets 70,473 44,507
Liabilities
Current liabilities
Trade and other payables 16 10,217 5,525
Financial Liabilities 17 – 20,351
Other financial liabilities 17 – 28
Corporation tax liability 16 321 109
Total current liabilities 10,538 26,013
Non-current liabilities
Provisions 19 8,376 6,669
Total non-current liabilities 8,376 6,669
Total liabilities 18,914 32,682
Net Assets 51,559 11,825
Capital and reserves attributable to equity holders of the company
Share capital 20 5,058 11,285
Deferred shares 10,721 –
Share premium 40,711 20,053
Convertible debt reserve – 68
Warrant and share option reserve 729 859
Contributed equity reserve 8,111 –
Retained deficit (13,771) (20,440)
Total Equity 51,559 11,825
The financial statements were authorised and approved for issue by the Board of Directors on 24 May 2012 and were signed on its 
behalf by:
Chris Kelsall
Finance Director
The notes on pages 34 to 56 form part of these financial statements.
Consolidated statement of financial position
At 31 December 2011 – Company Number 5323487 30
Mediterranean Oil & Gas Plc Annual Report 2011 www.medoilgas.com
Note
2011  
€’000
2010 
€’000
Cash flows from operating activities
Profit/(loss) for the year 6,432 (7,820)
Adjustments for: 
Impairment 1,086 3,140
Depreciation, depletion and amortisation 1,395 1,134
Share-based payments expense 39 217
Loss on disposal of property, plant and equipment – 56
Other net finance expense 1,038 1,015
Finance gain on settlement of debt (5,707) –
Tax (credit)/expense (3,598) 37
Foreign exchange (245) –
Unwinding of discount on provision 610 738
Cash flows from operating activities before changes in working capital and provisions 1,050 (1,483)
Decrease in inventories 70 32
Increase in trade and other receivables (4,496) (674)
Increase in trade and other payables 4,692 1,785
Increase in provisions 364 328
Taxes paid (633) 6
Net cash flows from operating activities 1,047 (6)
Investing activities
Purchase of property, plant, equipment (16,327) (991)
Exploration costs incurred (1,440) (2,707)
Interest received 15 32
Net cash flows used in investing activities
(17,752) (3,666)
Financing activities
Issue of new shares – cash received 22,748 –
Issue of new shares – cost of issuing (826) –
Interest paid (257) (426)
Loan draw down – 1,001
Repayment of loan (3,877) –
Net cash generated from financing activities 17,788 575
Net increase/(decrease) in cash and cash equivalents 21 1,083 (3,097)
Cash and cash equivalents at the beginning of the year 2,810 5,907
Foreign exchange losses on cash and cash equivalents (190) –
Cash and cash equivalents at the end of the year 3,703 2,810
The notes on pages 34 to 56 form part of these financial statements.
Consolidated statement of cash flows
For the year ended 31 December 2011 31
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Share capital
€’000
Deferred 
shares
€’000
Share 
premium 
€’000
Contributed 
equity reserve
€’000
Warrant and 
share option 
reserve
€’000
Convertible 
debt reserve
€’000
Retained 
Deficit
€’000
Total
€’000
Company
At 1 January 2010 11,285 – 20,053 – 723 68 (12,701) 19,428
Total comprehensive loss for the period – – – – – – (5,614) (5,614)
Share-based payment – – – – 217 – – 217
Lapse of options – – – – (81) – 81 –
As at 31 December 2010 11,285 – 20,053 – 859 68 (18,234) 14,031
Total comprehensive income for the year – – – – – – 2,948 2,948
Shares issued – Fundraising (net) 4,025 – 18,327 – – – – 22,352
Shares issued – Settlement of Convertible 
Debt 469 – 2,331 8,111 – (68) 68 10,911
Share Consolidation (10,721) 10,721 – – – – – –
Share-based payment – – – – 39 – 39
Lapse of options – – – – (169) – 169 –
As at 31 December 2011 5,058 10,721 40,711 8,111 729 – (15,049) 50,281
The following describes the nature and purpose of each reserve within owners’ equity:
Reserve Description and purpose
Share capital Amount subscribed for ordinary share capital at nominal value.
Deferred share capital Amount representing ordinary 19p shares following split of shares as part of 
recapitalisation exercise.
Share premium Amount subscribed for share capital in excess of nominal value.
Contributed equity reserve An amount representing equity contributed directly by shareholders.
Warrant and share option reserve Cumulative fair value of warrants and options, adjusted for transfers on exercise of share 
options and warrants.
Convertible debt reserve Equity component of convertible bonds.
Retained Deficit Cumulative net gains and losses recognised in the consolidated income statement, 
adjusted for transfers on exercise of share options.
The notes on pages 34 to 56 form part of these financial statements.
Company statement of changes in equity
For the year ended 31 December 2011 32
Mediterranean Oil & Gas Plc Annual Report 2011 www.medoilgas.com
Note
2011 
€’000
2010 
€’000
Assets
Non-current assets
Investments 12 29,767 13,936
Total non-current assets 29,767 13,936
Current assets
Trade and other receivables 15 19,649 20,403
Cash and cash equivalents 21 2,464 1,221
Total current assets 22,113 21,624
Total assets 51,880 35,560
Liabilities
Current liabilities
Trade and other payables 16 1,599 1,150
Financial Liabilities 17 – 20,351
Other financial liabilities 17            – 28
Total current liabilities 1,599 21,529
Total liabilities 1,599 21,529
Net Assets 50,281 14,031
Capital and reserves attributable to equity holders of the company 5,058 11,285
Ordinary share capital
Deferred shares 10,721 –
Share premium 40,711 20,053
Convertible debt reserve – 68
Warrant and share options reserve 729 859
Contributed equity 8,111 –
Retained losses (15,049) (18,234)
Total Equity 50,281 14,031
The financial statements were authorised and approved for issue by the Board of Directors on 24 May 2012 and were signed on its 
behalf by:
Chris Kelsall
Finance Director
The notes on pages 34 to 56 form part of these financial statements.
.
Company statement of financial position
At 31 December 2011 – Company Number 5323487 33
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Note
2011
€’000
2010
€’000
Cash flows from operating activities
Profit/(loss) for the year 2,948 (5,614)
Adjustments for: 
Impairment – 3,000
Realised foreign exchange gains (361) _
Foreign exchange gains/losses – Other (435) _
Share-based payments expense 39 217
Finance income (48) (581)
Finance expense 418 1,108
Finance gain on settlement of debt (5,707) –
Cashflows from operating activities before changes in working capital and provisions (3,146) (1,870)
(Increase) in trade and other receivables (406) (149)
Decrease in trade and other payables (138) (101)
Cash flows from operating activities (3,690) (2,120)
Investment activities
Interest received 16 27
Loans made to subsidiaries (12,871) (1,567)
Net cashflows used in investing activities (12,855) (1,540)
Financing activities
Issue of new shares – cash received 22,748 –
Issue of new shares – cost of issuing (826) –
Interest paid (257) (426)
Loan draw down – 1,001
Repayment of loan (3,877) –
Net cash generated from financing activities 17,788 575
Net increase/(decrease) in cash and cash equivalents 21 1,243 (3,085)
Cash and cash equivalents at the beginning of the year 1,221 4,306
Cash and Cash Equivalents at the end of the year 2,464 1,221
The notes on pages 34 to 56 form part of these financial statements.
Company statement of cash flows
For the year ended 31 December 2011 34
Mediterranean Oil & Gas Plc Annual Report 2011 www.medoilgas.com
1 Accounting policies 
Basis of preparation
The principal accounting policies adopted in the preparation of the financial statements are set out below. The policies have been 
consistently applied to all the periods presented, unless otherwise stated.
These financial statements have been prepared in accordance with International Financial Reporting Standards (IFRSs and IFRIC 
interpretations) issued by the International Accounting Standards Board (IASB) as adopted by the European Union and with those parts of 
the Companies Act 2006 applicable to companies preparing their accounts under IFRS. The Company’s functional currency is the Euro and 
it has adopted the Euro as its presentational currency. The Group has adopted the Euro as its presentational currency.
Going concern
The Directors consider that it is appropriate for the accounts to be prepared on a going concern basis. At 31 December 2011, the Group had 
net assets of €51.6m and net current assets of €4.1m. 
On 8 November 2011, the Company entered into a short-term secured loan facility with affiliates of certain of its substantial shareholders, 
namely affiliated investment funds of Och-Ziff Capital Management Group (‘Och Ziff’), for up to €3.5m (the ‘Loan Facility’). The purpose  
of the Loan was to assist the Company in funding the acquisition of 1,000 sq km of 3D seismic exploration data, in relation to its licence 
commitment at Area 4 Offshore Malta, under the Malta Production Sharing Contract signed with the Maltese Government on  
18 July 2008 and its Addendum signed on 17 May 2011. Draw downs under the Loan Facility at 31 December 2011 amounted to €nil  
(31 December 2010: €nil). Subsequent to the reporting date, on 7 February 2012, the Company borrowed €2.0m (the ‘Principal’) under  
the Loan Facility. Repayment of the entire Principal and accrued interest thereon was completed on 26 April 2012 (Refer to Notes 25 and 26, 
for further information).
Management has prepared cash flow projections which reflect the effect of the recapitalisation and indicate that the Group can continue to 
meet its liabilities as they fall due and meet minimum spend commitments on its licenses for a period of not less than 12 months from the 
date of the financial statements.
Basis of accounting and adoption of new and revised standards
a) Standards, amendments and interpretations effective in 2011:
The following new standards and amendments to standards are mandatory for the first time for the Group for the financial year beginning 
1 January 2011. Except as noted, the implementation of these standards did not have a material effect on the Group: 
Standard Impact on initial application Effective date
IFRIC 19 Extinguishing financial 
liability with equity 
instruments 
This interpretation addresses transactions in which an 
entity issues equity instruments to a creditor in return for the 
extinguishment of all or part of a financial liability. 
The Group applied this interpretation from 1 January 2011.
1 July 2010 
IAS 24 (Revised) Related party 
disclosures 
The revised standard responds to concerns that the previous 
disclosure requirements and the definition of a related party 
were too complex and difficult to apply in practice, especially in 
environments where government control is pervasive. 
The Group applied the revised standard from 1 January 2011.
1 January 2011
Improvements to 
IFRSs (2010)
The improvements in this amendment clarify the requirements 
of IFRSs and eliminate inconsistencies within and between 
standards. 
The Group applied the amendments from 1 January 2011.
1 January 2011 
Notes forming part of the financial statements
For the year ended 31 December 2011 35
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b) Standards, amendments and interpretations that are not yet effective and have not been early adopted: 
Standard Effective date
IFRS 7 (Amendments) Disclosures – transfers of financial assets 1 July 2011
IAS 12 (Amendment) Deferred tax: recovery of underlying assets 1 January 2012*
IAS 1 (Amendment) Presentation of items of other comprehensive income 1 July 2012*
IFRS 10 Consolidated financial statements 1 January 2013*
IFRS 11 Joint arrangements 1 January 2013*
IFRS 12 Disclosure of interest in other entities 1 January 2013*
IFRS 13 Fair value measurement 1 January 2013*
IAS 27 (Amendment 2011) Separate financial statements 1 January 2013*
IAS 28 (Amendment 2011) Investments in associates and joint ventures 1 January 2013*
IAS 19 (Amendment 2011) Employee benefits 1 January 2013*
IFRS 7 (Amendment 2011) Disclosures – offsetting financial assets and financial liabilities 1 January 2013*
IAS 32 (Amendment 2011) Offsetting financial assets and financial liabilities 1 January 2014*
IFRS 9 Financial instruments 1 January 2015*
* Not yet endorsed by the EU. 
The Group is evaluating the impact of the above pronouncements but they are not expected to have a material impact on the Group’s 
earnings or shareholders’ funds.
Basis of consolidation
Where the Company has the power, either directly or indirectly, to govern the financial and operating policies of another entity or business 
so as to obtain benefits from its activities, it is classified as a subsidiary. The consolidated financial statements present the results of the 
Company and its subsidiaries (‘the Group’) as if they formed a single entity. Intercompany transactions and balances between group 
companies are therefore eliminated in full.
The Company has taken advantage of the exemption allowed under section 408 of the Companies Act 2006 and has not presented its 
own income statement in these financial statements. The Group profit for the year includes a profit after tax of €2.9m (2010: loss after tax 
€5.61m) in respect of the Company, this is dealt with in the financial statements of the Parent Company.
Business combinations
The consolidated financial statements incorporate the results of business combinations using the purchase method. In the consolidated 
statement of financial position, the acquiree’s identifiable assets, liabilities and contingent liabilities are initially recognised at their fair 
values at the acquisition date. The results of acquired operations are included in the consolidated income statement from the date on which 
control is obtained.
Jointly controlled operations and jointly controlled assets
The Group includes the assets it controls, its share of any income and the liabilities and expenses of jointly controlled operations and jointly 
controlled assets in accordance with the terms of the underlying contractual arrangement.
The Company’s investments in subsidiaries
In its separate financial statements the Company recognises its investments in subsidiaries at cost, less any impairment. The cost of 
acquisition includes directly attributable professional fees and other expenses incurred in connection with the acquisition.
Revenue recognition
Revenue is derived from sales of oil and gas to third party customers and fees received from third parties in return for services associated 
with the operation of oil and gas fields owned in conjunction with other parties. Sales of oil and gas production are recognised at the time 
of delivery of the product to the purchaser which is when the risks and rewards of ownership pass. Sales of oil and gas services are 
recognised based on the services provided and the timing of the provision of those services.
Interest revenue is accrued on a time basis, by reference to the principal outstanding at the effective interest rate applicable.
Tax
The major components of tax on profit or loss include current and deferred tax.
Current tax is based on the profit or loss adjusted for items that are non-assessable or disallowed and is calculated using tax rates that 
have been enacted or substantively enacted by the reporting date.
Tax is charged or credited to the income statement, except when the tax relates to items credited or charged directly to equity, in which case 
the tax is also dealt with in equity. 36
Mediterranean Oil & Gas Plc Annual Report 2011 www.medoilgas.com
1 Accounting policies (continued)
Deferred taxation
Deferred tax assets and liabilities are recognised where the carrying amount of an asset or liability in the statement of financial position 
differs to its tax base.
Recognition of deferred tax assets is restricted to those instances where it is probable that taxable profit will be available, against which the 
difference can be utilised.
The amount of the asset or liability is determined using tax rates that have been enacted or substantively enacted by the reporting date 
and are expected to apply when the deferred tax liabilities/(assets) are settled/(recovered).
Oil and gas assets: exploration and evaluation 
The Group applies the full cost method of accounting for Exploration and Evaluation (‘E&E’) costs, having regard to the requirements of IFRS 6 
‘Exploration for and Evaluation of Mineral Resources’. Under the full cost method of accounting, costs of exploring for and evaluating oil and 
gas properties are accumulated and capitalised by reference to appropriate cash generating units (‘CGUs’). Such CGUs are based on 
geographic areas and are not larger than a segment.
E&E costs are initially capitalised within ‘Intangible assets’. Such E&E costs may include costs of licence acquisition, technical services and 
studies, seismic acquisition, exploration drilling and testing, but do not include costs incurred prior to having obtained the legal rights to 
explore an area, which are expensed directly to the income statement as they are incurred.
Plant, Property and Equipment (‘PPE’) acquired for use in E&E activities are classified as property, plant and equipment. However, to the 
extent that such PPE is consumed in developing an intangible E&E asset, the amount reflecting that consumption is recorded as part of the 
cost of the intangible E&E asset.
Intangible E&E assets related to exploration licences are not depreciated and are carried forward until the existence (or otherwise) of 
commercial reserves has been determined. The Group’s definition of commercial reserves for such purpose is proven and probable 
reserves on an entitlement basis.
If commercial reserves have been discovered, the related E&E assets are assessed for impairment on a CGU basis as set out below and 
any impairment loss is recognised in the income statement. The carrying value, after any impairment loss, of the relevant E&E assets is then 
reclassified as development and production assets within property, plant and equipment and are amortised on a unit of production basis 
over the life of the commercial reserves of the pool to which they relate. Intangible E&E assets that relate to E&E activities that are not yet 
determined to have resulted in the discovery of commercial reserves remain capitalised as intangible E&E assets at cost, subject to meeting 
impairment tests as set out below.
E&E assets are assessed for impairment when facts and circumstances suggest that the carrying amount may exceed its recoverable 
amount. Such indicators include the point at which a determination is made as to whether or not commercial reserves exist. Where the E&E 
assets concerned fall within the scope of an established CGU, the E&E assets are tested for impairment together with all development and 
production assets associated with that CGU, as a single cash generating unit. The aggregate carrying value is compared against the 
expected recoverable amount of the pool, generally by reference to the present value of the future net cash flows expected to be derived 
from production of commercial reserves. Where the E&E assets to be tested fall outside the scope of any established CGU, there will 
generally be no commercial reserves and the E&E assets concerned will generally be written off in full. Any impairment loss is recognised in 
the income statement.
A separate category of intangible asset being Gas storage assets have previously been shown representing the potential value of gas 
storage facilities within the portfolio. Assets are held at cost with impairment reviews conducted in line with the requirement of IFRS 6.
Other intangible assets are held by the Group, being software and other licences. Amortisation is provided to write off the cost initially 
recognised and carried, of other intangible assets, in line with a reducing balance basis over the remaining expected useful life. Other 
intangible assets have been disclosed as part of exploration and evaluation.
Oil and gas assets: development and production
Development and production assets are accumulated on a field-by-field basis and represent the cost of developing the commercial 
reserves discovered and bringing them into production, together with the decommissioning asset (see below) and the E&E expenditures 
incurred in finding commercial reserves transferred from intangible E&E assets as outlined above. They are presented as oil and gas 
properties in Note 4.
The net book values of producing assets are depreciated on a field-by-field basis using the unit of production method by reference to the 
ratio of production in the period to the related commercial reserves of the field, taking into account estimated future development 
expenditures necessary to bring those reserves into production.
An impairment test is performed whenever events and circumstances arising during the development or production phase indicate that 
the carrying value of a development or production asset may exceed its recoverable amount. The aggregate carrying value is compared 
against the expected recoverable amount of the cash generating unit, generally by reference to the present value of the future net cash 
flows expected to be derived from production of commercial reserves. The cash generating unit applied for impairment test purposes is 
Notes forming part of the financial statements continued
For the year ended 31 December 2011 37
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generally the field, except that a number of field interests may be grouped as a single cash generating unit where the cash flows of each 
field are interdependent.
Decommissioning
Where a material liability for the removal of production facilities and site restoration at the end of the productive life of a field exists, a 
provision for decommissioning is recognised from the outset. The amount recognised is the present value of estimated future expenditure 
determined in accordance with local conditions and requirements. Included within the relevant asset is an amount equivalent to the 
provision which is depreciated on a unit of production basis. Changes in estimates are recognised prospectively, with corresponding 
adjustments to the provision and the associated asset.
Impairment of non-financial assets
Non-financial assets and identifiable intangibles, other than oil and gas assets, are reviewed for impairment whenever events or changes 
in circumstances indicate that the carrying amount may not be recoverable. If the expected discounted future cash flow from the use of the 
assets and their eventual disposal is less than the carrying amount of the assets, an impairment loss is recognised and measured using 
the asset’s fair value or discounted cash flows.
Property, plant and equipment other than oil and gas assets
Depreciation is provided to write off the cost less estimated residual values, initially recognised and carried, of all property, on a reducing 
balance basis over their expected useful lives. Depreciation is calculated at the following rates:
Plant and equipment – 10% per annum range 10% – 12%
Financial assets and liabilities
The Group’s financial assets consist of available for sale assets, and loans and receivables. There are no financial assets classified as held 
to maturity or at fair value through profit or loss.
Available-for-sale: Non-derivative financial assets are classified as available-for-sale and comprise the Group’s strategic investments in 
entities not qualifying as subsidiaries, associates or jointly controlled entities. Unquoted available for sale investments whose fair value 
cannot be reliably valued are carried at cost.
Loans and receivables:
Cash and cash equivalents consist of cash on hand and cash held on current account or on short-term deposits (up to 90 days) at variable 
interest rates. Any interest earned is accrued monthly and classified as finance income.
Trade and other receivables are initially measured at fair value and subsequently at amortised cost.
The Group’s financial liabilities consist of financial liabilities held at amortised cost, and held at fair value through profit and loss.
Trade and other payables, which are initially stated at their fair value and subsequently at amortised cost. All interest and other borrowing 
costs are recognised on a time-proportion basis using the effective interest method and expensed as part of financing costs in the 
income statement.
Embedded derivatives are measured at fair value at each reporting date with the movement in fair value being recognised in the income 
statement as they arise. Details of inputs into fair value calculations are available in note 18. All warrant derivatives have been extinguished 
in the current period.
Convertible bonds
Where a convertible loan meets the definition of a compound financial instrument the component parts are classified separately as 
financial liabilities and equity in accordance with the substance of the contractual arrangements. The fair value on issue of the Group’s 
convertible bonds was split into their liability and equity components on the basis of their fair value. The amount initially attributed to the 
debt component equals the discounted cash flows using a market rate of interest that would be payable on a similar debt instrument that 
did not include an option to convert. Subsequently, the debt component is accounted for as a financial liability measured at amortised cost. 
The difference between the net proceeds of the convertible loan note and the amount allocated to the debt component is credited direct  
to a separate equity reserve and is not subsequently re-measured. On conversion, the amount of fair value of shares issued has been 
recognised within share capital and share premium. The excess fair value of the debt settled has been recognised as contributed equity  
as the debt holders are all shareholders who have acted in their capacity as shareholders for the benefit of the company. The Group’s 
convertible bonds were renegotiated in 2007 , 2008 and 2009 and accounted for in accordance with this accounting policy. All convertible 
bonds have been settled in 2011.
Foreign currency
Transactions entered into by group entities in a currency other than the currency of the primary economic environment in which they 
operate (the ‘functional currency’) are recorded at the rates ruling when the transactions occur. Foreign currency monetary assets and 
liabilities are translated at the rates ruling at the reporting date.
Share capital is denominated in Sterling and translated at historic rate. 38
Mediterranean Oil & Gas Plc Annual Report 2011 www.medoilgas.com
1 Accounting policies (continued)
Functional and presentation currency
Items included in the financial statements of each of the Group’s entities are measured using the currency of the primary economic 
environment in which the entity operates (the functional currency). The consolidated financial statements are presented in Euro, which is 
also the functional currency of the Company and its significant subsidiaries.
Transactions and balances 
Foreign currency transactions are translated into the relevant functional currency using the exchange rates prevailing at the date of the 
transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year end 
exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the statement of comprehensive 
income in other income and expenses.
Other provisions
A provision is recognised in the statement of financial position when the Group has a present legal or constructive obligation as a result of a 
past event, and it is probable that an outflow of economic benefits will be required to settle the obligation. If the effect is material, provisions 
are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of the time value of 
money and, where appropriate, the risks specific to the liability.
Share-based payments
The Group issues equity-settled share-based payments to certain employees. Equity-settled share-based payments are measured at fair 
value at the date of grant. The fair value determined at the grant date of the equity-settled share-based payments is expensed on a 
straight-line basis over the vesting period, based on the Group’s estimate of shares that will eventually vest.
Where equity instruments are granted to persons other than employees, the income statement is charged with the fair value of goods and 
services received.
Options granted by the parent company to employees of subsidiaries are measured as equity-settled share based payments, and 
expensed in the company receiving employee services. 
No new equity-settled instruments have been issued during the year. Detail of those issued to management after the reporting date are set 
out in note 26. 
Inventories
Inventories are initially recognised at cost, and subsequently at the lower of cost and net realisable value.
Cost comprises all costs of purchase, costs of conversion and other costs incurred in bringing the inventories to their present location and 
condition. Oil and gas production flows directly into the national grid therefore there are no oil and gas inventories held. 
Leased assets
Where substantially all of the risks and rewards incidental to ownership of a leased asset have been transferred to the Group (a ‘finance 
lease’), the asset is treated as if it had been purchased outright. The amount initially recognised as an asset is the fair value of the leased 
asset or, if lower, the present value of the minimum lease payments payable over the term of the lease. The corresponding lease 
commitment is shown as a liability. Lease payments are analysed between capital and interest. The interest element is charged to the 
income statement over the period of the lease and is calculated so that it represents a constant proportion of the lease liability. The capital 
element reduces the balance owed to the lessor.
Where substantially all of the risks and rewards incidental to ownership are retained by the lessor (an ‘operating lease’), the total rentals 
payable under the lease are charged to the income statement on a straight-line basis over the lease term. The land and buildings 
elements of property leases are considered separately for the purposes of lease classification.
Joint Ventures
The Group includes the assets it controls, its share of any income and the liabilities and expenses of jointly controlled operations and jointly 
controlled assets in accordance with the terms of underlying contractual arrangements.
Critical accounting judgements and key sources of estimation uncertainty 
In the process of applying the Group’s accounting policies, which are described in Note 1, management has made the following 
judgements that have the most significant effect on the amounts recognised in the financial statements (apart from those involving 
estimations, which are dealt with below).
Under the full cost method of accounting for E&E costs, intangible costs are capitalised as intangible assets by reference to appropriate 
CGUs, and are assessed for impairment on a concession basis when circumstances suggest that the carrying amount may exceed its 
recoverable value and, therefore, there is a potential risk of an impairment adjustment. This assessment involves judgement as to: (i) the 
likely future commerciality of the asset and when such commerciality should be determined; (ii) future revenues and costs pertaining to any 
concession based on proved plus probable, prospective and contingent resources; and (iii) the discount rate to be applied to such revenues 
and costs for the purpose of deriving a recoverable value.
Notes forming part of the financial statements continued
For the year ended 31 December 2011 39
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Following the issuance of Italian Legislative Decree June, no. 128/2010 (the ‘Decree’) prohibiting certain exploration and production activities 
in selected sea and Italian coastal areas, there is some uncertainty over the Group’s ability to progress the Ombrina Mare asset (‘Ombrina 
Mare’) as previously scheduled, or at all. The current status of attempts to resolve this situation is detailed in Note 5.
Ombrina Mare is recorded in the financial statements for the year ended 31 December 2011 at €18.0m. The Board has reviewed the current 
carrying value against certain criteria, including those applicable under IFRS 6 (Exploration for and Evaluation of Mineral Resources), and 
have concluded that no impairment of Ombrina Mare should be recognised for the year ended 31 December 2011. This conclusion is also 
based upon advice received from the Group’s Italian legal counsel and recognising that the indicated resource at Ombrina Mare 
represents significant potential to the Group.
Together with other members of the oil industry based in Italy, the Group is presently in discussions with relevant Italian government 
authorities in order to identify a solution to enable the development of Ombrina Mare. The Group will continue to monitor legislative 
changes closely and pursue avenues for legal recovery, should the situation merit such action.
Key sources of estimation uncertainty
The key assumptions concerning the future, and other key sources of estimation uncertainty at the reporting date, that have a significant 
risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year, are discussed below.
(a) Impairment reviews
Whilst conducting an impairment review of its assets, the Group exercises judgement in making assumptions about future gas prices, 
reserves, rehabilitation costs, future development and production costs. Changes in estimate can result in significant changes to the 
consolidated statement of comprehensive income. The policy in respect of impairment reviews is set out above and details of reviews 
carried out during the year are set out in notes 4 and 5.
(b) Decommissioning
Provision was made in the accounts for future decommissioning costs to plug and abandon wells. The cost of provision should be added to 
the value of the development and production asset and depreciated on the unit of production basis. The decommissioning liability is stated 
in the accounts at discounted present value and accreted up to the final liability by way of an annual finance charge.
The Group has potential decommissioning obligations in respect of its producing interests in Italy. The extent to which a provision is 
required in respect of these potential obligations depends, inter alia, on the legal requirements at the time of decommissioning, the cost 
and timing of any necessary decommissioning works, and the discount rate to be applied to such costs. The decommissioning provision 
and how the cost is calculated are described in more detail in Note 19. 
(c) Reserves
Development and production assets (oil and gas properties) within Property, Plant and Equipment are depreciated on a concession basis 
using the unit of production method at a rate calculated by reference to proven plus probable reserves. These reserves have been 
determined using technical estimates of oil and gas in place and recovery factors. Future development costs are estimated using 
assumptions as to the number of wells required to produce the commercial reserves, the cost of such wells and associated production 
facilities, and other capital costs. The carrying amount of development and production assets at 31 December 2011 is shown in Note 4.
(d) Deferred tax
Judgement is applied in making assumptions about future taxable income, including gas prices, production, rehabilitation costs and 
expenditure to determine the extent to which the Group recognises deferred tax assets, as well as the anticipated timing of the utilisation of 
the losses.
(e) Share based payment 
Refer to note 22 for the keys assumptions used in determining the value of Share based payments.
2 Finance income and expense 
2011
€’000
2010
€’000
Finance income
Finance gain on settlement of debt 5,707 –
Foreign Exchange Income 435 –
Bank interest received 22 32
Change in fair value of derivative (Note 17) 28 450
6,192 482
Finance expense
Costs associated with financing transactions 418 –
Unwinding of discount on provisions 610 738
Convertible debt 413 1,044
Bank interest paid 257 453
Loss on foreign exchange – 549
1,698 2,784 40
Mediterranean Oil & Gas Plc Annual Report 2011 www.medoilgas.com
3 Earnings/(loss) per share  
2011
€’000
2010
€’000
Numerator
Profit/(loss) for the year 6,432 (7,820)
Denominator
Weighted average number of shares used in basic EPS 290,140,596 38,912,736
Potential ordinary shares are excluded on the grounds that they are non dilutive and can be 
found in Notes 17 and 25.
Earnings/(loss) per share attributable to the equity holders of the parent
– Basic and diluted €0.02 €(0.20)
4 Property, plant and equipment 
Plant and 
Equipment
€’000
Oil and Gas 
Assets
€’000
Total
€’000
Group
Cost
At 1 January 2010 1,431 11,109 12,540
Additions 11 226 237
Movement on decommissioning assets – (221) (221)
Disposals (57) – (57)
At 31 December 2010 1,385 11,114 12,499
Additions and transfers* 6 18,002 18,008
Movement on decommissioning assets – 1,202 1,202
At 31 December 2011 1,391 30,318 31,709
Depreciation, depletion and impairment
At 1 January 2010 (804) (5,760) (6,564)
Charge for the year (148) (986) (1,134)
Impairments (228) (1,097) (1,325)
Disposals 1 119 120
At 31 December 2010 (1,179) (7,724) (8,903)
Charge for the year (10) (1,253) (1,263)
Impairments – (1,043) (1,043)
At 31 December 2011 (1,189) (10,020) (11,209)
Net book value
At 31 December 2011 202 20,298 20,500
At 31 December 2010 207 3,390 3,597
At 1 January 2010 627 5,349 5,976
* PPE has seen a substantial increase in the year due to the commencement of production of AC 35 A.G (Guendalina field) transferred from intangible assets for a total net value of 
€2.493m and subsequent additions of €15.377m.
Recognition of impairment losses
The assets affected by impairment losses are oil and gas properties. Management reviewed the carrying values of all properties classified 
as PPE to ascertain the recoverability of values in respect of concessions where facts and circumstances suggest that the carrying amount 
may exceed its recoverable amount. Recoverable amount is based on value in use. A discount rate of 10% has been used in the value in 
use calculation which has been deemed appropriate given the risk profile of the Group.
As a result of this exercise and due to natural depletion of fields, an impairment loss of €1.043m was recognised for PPE during the year 
and represents the impairment provision to bring the assets to their estimated recoverable value from sale or production. The impairments 
can be summarised as follows: €0.586m for the Torrente Cigno concession (Masseria Vincelli 1 and Torrente Cigno 4 wells) and an 
impairment provision of €0.457m for the Lucera concession (Reggente, Bastia and Santa Caterina fields).
Notes forming part of the financial statements continued
For the year ended 31 December 2011 41
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5 Intangible assets 
Gas storage
asset
€’000
Exploration 
assets
€’000
Total
€’000
Company 
intangible 
assets
€’000
Cost
At 1 January 2010 3,509 27,230 30,739 190
Additions – 2,707 2,707 –
Other movement – 741 741 –
Impairment – (470) (470) (190)
Movement on decommissioning asset (816) (422) (1,238) –
At 31 December 2010 2,693 29,786 32,479 –
Additions – 4,057 4,057 –
Transfers to PPE – (2,493) (2,493) –
Impairment – (43) (43) –
Movement on decommissioning assets – (98) (98) –
At 31 December 2011 2,693 31,209 33,902 –
Amortisation and Impairment
At 1 January 2010 (1,119) (184) (1,303) –
Charge for the year – (45) (45) –
Impairment (1,574) – (1,574) –
At 31 December 2010 (2,693) (229) (2,922) –
Charge for the year – (132) (132) –
At 31 December 2011 (2,693) (361) (3,054) –
Net book value
At 31 December 2011 – 30,848 30,848 –
At 31 December 2010 – 29,557 29,557 –
At 1 January 2010 2,390 27,046 29,436 190
The intangible assets include all those costs incurred for the exploration and economical evaluation of potentially productive fields. In the 
prior period a gas storage asset held as intangible was written off to nil.
Recognition of impairment losses
The assets affected by impairment losses are oil and gas exploration and evaluation assets. Management review the carrying values of 
exploration and evaluation assets, classified as intangible assets pending evaluation of commercially viable reserves, to ascertain the 
recoverability of values in respect of concessions where facts and circumstances suggest that the carrying amount may exceed its 
recoverable amount. Recoverable amount is based on value in use. A discount rate of 10% has been used in the value in use calculation 
which is deemed appropriate given the risk profile of the Group.
As a result of this exercise, an impairment loss of €43,000 was recognised against the intangible assets relating to the Settecerri 
exploration permit that was relinquished during the year (2010: €470,000). 
During the year, the Group has continued to seek clarification of the impact of Italian Legislative Decree June, no. 128/2010 (the ‘Decree’), 
prohibiting E&P activities in certain sea and Italian coastal areas. During 2011, the Italian legislature has issued no change or formal 
clarification in relation to the Decree. 
On 6 April 2012, Law Decree 5/2012 was ratified into Italian law. The new Law 35/2012 clarifies that the limitations provided by the Decree 
128/2010 do not apply to either existing mining titles or ‘relevant extensions’. As a consequence of this, in May 2012, the Italian Ministry for 
Economic Development granted a three year extension to the Ombrina Mare exploration permit (BR269 GC), until 5 May 2015. The Directors 
consider this to be a positive sign in ongoing discussions with the Italian authorities regarding the issuance of a production concession for 
the Group’s proposed development of the Ombrina Mare field.
The Directors are currently exploring and undertaking various courses of action in order to seek a resolution of the current situation and will 
continue to do so in the coming months. These steps include ongoing negotiations with various government departments, taking legal 
action along with other oil companies and lobbying the Italian government for clarity over terms used in the Decree to allow the Group to 
continue with planned substantial investment and development of the asset.  42
Mediterranean Oil & Gas Plc Annual Report 2011 www.medoilgas.com
5 Intangible assets (continued)
Given the issues stated above, the Board have reviewed the current carrying value of €18.0m relating to the Ombrina Mare asset against 
certain criteria, including that set out within relevant accounting standards (IFRS 6, Exploration for and Evaluation of Mineral Resources), and 
have concluded that no impairment of the Ombrina asset should be recognised. This conclusion is based upon the fact that the Group has 
received a 3 year extension of the exploration permit and the indicated resource at Ombrina Mare indicates that the asset has significant 
potential to the Group. The Directors therefore remain confident of being able to advance this asset into production.
In May 2011, the Company agreed an 18 month extension to the first exploration period of the PSC with the Maltese Government, thus 
extending the first exploration period until mid-January 2013. 
Since 2008, the Company has completed a detailed G&G assessment of the area, in order to de-risk the prospects and verify the presence 
of technically and commercially valuable exploration drilling opportunities. With this objective in mind, in late 2011 the Company acquired 
1,012 sq km of high resolution long offset 3D seismic data on the most prospective sector of Area 4. The Company believes that this 3D data 
will be fundamental to completing the G&G assessment and de-risking the exploration potential. A comprehensive CPR has been 
commissioned. The results of this study, which are expected early in the 3rd Quarter of 2012, will underpin the Company’s strategy to seek a 
farm-in partner and progress the exploration of this asset. Based on this, the Board have reviewed the current carrying value of €4.79m 
relating to the Malta 4 asset against certain criteria, including that set out in the relevant accounting standards (IFRS 6: Exploration for and 
Evaluation of Mineral Resources), and have concluded that no impairment of the Malta 4 asset should be recognised. The conclusion is 
based upon the fact that the group had a valid claim over the Malta 4 license and the asset has significant potential to the Group. The 
Directors remain confident of being able to advance this asset through successful completion of the G&G assessment.  
The value of intangible assets includes an amount of €nil (2010: €nil) relating to a proposed gas storage project at the depleted Cupoloni 
gas field. The balance for this asset was fully provided during the prior year.
6 Capital commitments 
As at 31 December 2011, the Group had committed €1.81m (2010: €2.01m) in operational and exploration expenditure relating to various 
concessions. The above number represents all open/outstanding contracts and purchase orders.
7 Segmental reporting 
In the opinion of the Directors, the operations of the Group companies comprise three operating segments conducting exploration, 
production, and corporate activities. The Group operates in one geographic area, being Mediterranean Europe. The Group’s oil and gas 
revenues are generated entirely in Italy and result from sales to European based customers. 94% of Group revenue is generated from sales 
of gas and condensate to four customers (2010: 91%).
The reportable segments have been identified on the basis that these operating segments form the main identifiable cost centres for the 
group as reported to the Chief Operating Decision Maker (CODM). The CODM is defined as the Board of Directors. 
The top four customers contributed the following proportions to Group oil and gas revenues:
2011 2010
Customer 1 47% 77%
Customer 2 25% 0%
Customer 3 19% 7%
Customer 4 3% 7%
The primary financial statements presented reflect all the activities of these three operating segments. For the Group’s operating segments 
these are the key reportable items:
2011
Production 
€’000
Exploration 
€’000
Corporate 
€’000
Total  
€’000
Total revenues 5,649 – – 5,649
Profit before tax 1,189 (694) 2,339 2,834
Non-current assets 22,446 32,094 1,281 55,822
Non-current liabilities 4,827 3,265 284 8,376
Capital expenditure 17,986 4,078 – 22,064
Depreciation 1,253 – 142 1,395
Impairment charge 1,043 43 – 1,086
Taxation (144) – – (144)
Notes forming part of the financial statements continued
For the year ended 31 December 2011 43
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2010
Production 
€’000
Exploration 
€’000
Corporate 
€’000
Total  
€’000
Total revenues 3,488 – – 3,488
Profit before tax (1,330) (2,516) (3,937) (7,783)
Non current assets 5,585 29,557 34 35,176
Non current liabilities 4,065 2,604 – 6,669
Capital expenditure 226 2,663 64 2,953
Depreciation 4,604 – 65 4,669
Impairment charge 1,325 2,063 – 3,388
Taxation (37) – – (37)
Non-Current Assets comprise investment in oil and gas assets (see Notes 4 and 5) and other non-current receivables (see Note 15). Further 
information related to current and non-current liabilities is included in Note 17 .
8 Loss from operations
2011
€’000
2010
€’000
This has been arrived at after charging:
Staff costs (see Note 9) 2,443 2,355
Depreciation, depletion and amortisation 1,395 1,179
Impairment (Assets Notes 4-5) 1,086 3,388
Operating lease expense – Property 318 332
Services provided by the auditor:
 Audit fee for the Company 27 21
 Audit fee for the Group 75 59
 Other Services: – –
 Audit of accounts of associates of the company under legislation 11 11
 Other taxation services – 8
Loss on disposal of fixed assets – 16
9 Staff costs
2011
€’000
2010
€’000
Group
Staff costs (including directors) comprise:
Wages and salaries 934 1,071
Directors’ fees and benefits 882 498
Defined contribution pension cost 495 496
Social security and other similar taxes 93 73
Share-based payment expense (Note 22) 39 217
2,443 2,355
The average number of employees during the period, including Executive Directors was 33 (2010: 25).
2011
Number
2010
Number
Analysis of employees
General Management 11 4
Administration 9 8
Exploration 3 3
Operations 10 10
33 25
2011
€’000
2010
€’000
Company
Staff costs (including Executive and Non-Executive Directors) comprise:
Directors fees and benefits 399 268
Share-based payment expense (Note 22) 10 42
409 310
The average number of employees during the period, including Executive Directors was 2 (2010: 2). 44
Mediterranean Oil & Gas Plc Annual Report 2011 www.medoilgas.com
10 Directors’ remuneration 
The remuneration of the Directors, who are the key management personnel, for the year ended 31 December 2011 payable by Group 
companies, was as follows:
2011 
€’000
2010  
€’000
Executive Directors
Sergio Morandi 280 178
Chris Kelsall 238 156
Subtotal 518 334
Non-Executive Directors
Michael Bonte-Friedheim 201 112
Peter Clutterbuck 14 22
Salvatore Russo 30 30
Miles Donnelly 22 – 
Michael Seymour 22 –
Matthew Clarke 11 –
Andrew Cochran 64 –
Subtotal 364 164
Total 882 498
The above table only represents the short-term employee benefits being cash remuneration paid to the Group’s directors which includes 
payments by way of settlement and compromise. The non-cash share based payment charge in respect of key management personnel 
was €19,000 (2010: €122,000). No directors exercised share options in the period. During the year payments by way of settlement and 
compromise in respect of key management personnel totalled €107 ,920 (2010: €nil). No post employment or long term employee benefits 
were paid to key management personnel in the period (2010: €nil). 
11 Taxation 
The current year income tax charge includes:
2011
€’000
2010
€’000
Current taxation charge (144) (37)
Deferred tax credit 3,742 –
Tax credit/(charge) recognised in income statement 3,598 (37)
Current tax 
The reasons for the difference between the actual tax charge for the year and the standard rate of corporation tax in the UK applied to 
profits for the year are as follows:
2011 
€’000
2010 
€’000
Profit/(loss) before tax 2,835 (7,783)
Expected tax charge based on the standard rate of corporation tax in the UK of 26.5% (2010 – 28%) 751 (2,179)
Expenses not deductible for tax purposes 126 1,003
Utilisation of previously unrecognised tax losses (819) (11)
Tax losses carried forward – 1,224
Depreciation in excess of capital allowances –
Withholding Tax suffered 86
Prior period losses not previously recognised (3,742)      –
Temporary differences
Total tax charge/(credit) (3,598) 37
A deferred tax asset has not been recognised for the following:
Group Company
2011
€’000
2010
€’000
2011
€’000
2010
€’000
Unused tax losses 505 4,888 505 489
Notes forming part of the financial statements continued
For the year ended 31 December 2011 45
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Deferred tax
2011
€’000
2010
€’000
At 1 January – –
Recognised in the year – income statement credit 3,742 –
At 31 December 3,742 –
Deferred tax assets of €3.7m have been recognised in the period with regard to tax losses brought forward, to be utilised against taxable 
profits arising in the foreseeable future from oil and gas production, most notably from the Guendalina asset which commenced 
production in the year ended 31 December 2011. The jurisdiction that these tax losses have arisen in and are expected to be used in is Italy.
12 Subsidiaries
The principal undertakings in which the Company’s interest at the period end is 20% or more are as follows:
Subsidiary
undertakings Country of incorporation or registration
Proportion of voting rights and 
ordinary share capital held 2010 and 2011 Nature of business
Malta Oil Pty Limited Australia 100% Oil and gas exploration,
development and production
Medoilgas Italia S.p.A Italy 100% Oil and gas exploration,
development and production
Medoilgas Civita Ltd. UK 100% Oil and gas exploration,
development and production
Phoenicia Energy Company Limited Malta 100% Oil and gas exploration,
development and production
The proportions of voting rights and ordinary share capital held the entity listed above remains unchanged on the prior year. 
Group undertakings
Company
2011
€’000
2010
€’000
Cost
At 1 January 24,399 24,399
Increase in investment in subsidiaries 16,011
At 31 December 40,410 24,399
Provision
At 1 January and 31 December 10,643 10,643
Net book value 29,767 13,936
The increase in investments relates to additional funding provided to wholly owned subsidiary Medoilgas Italia S.p.A to bring the equity 
position of the subsidiary in line with legal requirements of the local financial reporting jurisdiction.
13 Financial assets
Group
2011
€’000
2010
€’000
Available-for-sale investments
–unquoted 34 34
Financial assets represent the Group’s strategic investment of a 13.07% interest in Reggente S.p.A
14 Inventories
2011
€’000
2010
€’000
Materials and supplies 2,533 2,603
The amount of inventories recognised as an expense during the period is: 70 32
The above expense arises from €16,000 expense for usage of spare parts and €54,000 for the sale of tubings and obsolete spare parts. An 
impairment test has also been carried out to compare book values with market values. 46
Mediterranean Oil & Gas Plc Annual Report 2011 www.medoilgas.com
15 Trade and other receivables
Group Company
2011
€'000
2010
€'000
2011
€'000
2010
€'000
Current Receivables
Trade receivables 1,994 886 – 3
Amounts due from Group undertakings – – 19,032 20,110
Other receivables 21 737 – 48
Tax receivables – VAT 4,331 – 553 –
Accrued income 1,704 540 – –
Prepayments 364 1,755 64 242
8,414 3,918 19,649 20,403
Non-Current Receivables
Other receivables – VAT 699 1,988 – –
Total Receivables 9,113 5,906 19,649 20,403
The trade receivable balance at the year-end predominantly relates to amounts owed from Medoilgas Italia S.p.A in relation to production 
from the Guendalina asset. 
The current tax receivable has arisen predominantly from VAT reimbursement which is receivable from the Italian government by the Italian 
subsidiary, Medoilgas Italia S.p.A. The non-current tax receivable relates to VAT recoverable in Italy of €699,000, which is not expected to be 
reimbursed in the next 12 month period. 
The recoverability of the current and non-current VAT receivable balances is due to be via a net reduction in taxation settlements made with 
the Italian tax authorities on charges to be incurred in the future as a result of tax liabilities arising from production activities. 
At 31 December 2011, there were receivables past due which have not been provided, since all amounts are within 6 months of being past 
due. Post year end all amounts past due have been fully recovered. 
16 Trade and other payables
Group Company
2011
€'000
2010
€'000
2011
€'000
2010
€'000
Trade payables 6,572 3,169 146 81
Other payables 182 117 1,382 815
Deferred income – 424 – –
Accruals 3,463 1,815 71 254
Tax payable 321 109 – –
10,538 5,634 1,599 1,150
17 Financial liabilities 
Group Company
2011
€’000
2010
€’000
2011
€’000
2010
€’000
Warrant derivative – 28 – 28
Convertible bonds – 5,389 – 5,389
Convertible loan notes – 5,378 – 5,378
Drawdown debt facility – 9,584 – 9,584
Total current – 20,379 – 20,379
Maturity analysis of financial liabilities:
Less than one year – 20,379 – 20,379
Total financial liabilities – 20,379 – 20,379
Notes forming part of the financial statements continued
For the year ended 31 December 2011 47
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Drawdown debt facility
The principle debt facility has been settled as follows:
Group and
Company
€’000
Debt brought forward at 1 January 2011 9,584
Settled in cash (3,877)
Gain on settlement of debt (5,707)
Debt carried forward at 31 December 2011 –
Convertible bond and loan notes
On 10 May 2011, as part of the Group Recapitalisation, the Group agreed terms with Stark Select Asset Master Limited (‘Stark Select’) as 
holder of the Convertible Bonds, and with holders of the Convertible Loan Notes (‘CLNs’), as a result of which, all outstanding Convertible 
Bonds and other CLNs were converted into new ordinary shares (together, the ‘Conversion Shares’) of the Company at a price of 24 pence 
per new ordinary share.
The holder of all of the outstanding Convertible Bonds, Stark Select, agreed to convert the whole of the outstanding principal amount of its 
Convertible Bonds into 19,858,333 Conversion Shares at a price of 24 pence per Conversion Share.
As the note holders were also shareholders and acting in their capacity as shareholders for the benefit of the Company the gain arising on 
settlement of this debt has been recognised as a capital contribution by shareholders and shown as such in the statement of changes in 
equity. With the approval of an extraordinary resolution of the holders of the CLNs, the Company agreed to amend the deed poll 
constituting the CLNs to give the Company the right to convert the outstanding CLNs at its election into 21,061,225 Conversion Shares, at a 
price of 24 pence per Conversion Share. The Company elected to convert all of the outstanding CLNs.
The original conversion prices of the CLNs and the Convertible Bonds were 40 pence and 50 pence respectively and the Company had no 
right to require conversion. The amendments to the terms and conversion prices of the CLNs and the Convertible Bonds were necessary to 
enable the Subscription and the Debt Cancellation to take place. The Conversion Shares were issued credited as fully paid, subject to the 
memorandum of association and Articles of the Company and rank pari passu in all respects with new ordinary shares then in issue, 
including the right to receive any future dividends and other distributions.
The principal financial liabilities have been extinguished as follows:
Group and
Company
€’000
Convertible bonds debt brought forward 5,389
Convertible loan notes debt brought forward 5,378
Total liability brought forward at 1 January 2011 10,767
Accretion charge 426
Foreign exchange (282)
Gain on settlement recognised in equity (8,111)
Conversion of debt into equity (2,800)
Financial Liability carried forward at 31 December 2011 –
At each reporting date the embedded derivatives, being the conversion option and the conversion right, are measured at their fair value 
with changes in fair value recognised within profit or loss as they arise. During the year the convertible loan note and bond were converted 
into new equity in the Company on the completion of the Group Recapitalisation, on 10 May 2011. 
The fair value of the derivative financial instruments has previously been valued using a Monte-Carlo simulation model for the conversion 
option and warrant.  48
Mediterranean Oil & Gas Plc Annual Report 2011 www.medoilgas.com
17 Financial liabilities (continued)
The inputs used at the prior period reporting date were as follows:
Derivative 
Liability 
As at
31/12/2010
Warrant As at
31/12/2010
Option Expiry 30/11/2011 30/11/2012
Term (years) 0.92 1 .92
Share Price (pence Sterling) 15.75 15.75
Conversion/Exercise Price (pence Sterling) 40 45
Risk-free rate (%) 4.20 3.94
Expected volatility (%) 75 75
The fair value of the derivative financial instruments disclosed in the financial statements was determined using a valuation technique 
based on assumptions that are not supported by prices from observable current market transactions in the same instrument. During 
the year all derivative financial instruments were settled by the issue of shares. No fair value movement for the current period has 
been recognised.
18 Financial instruments – risk management 
The principal financial instruments used by the Group and Company in 2011 and 2010 are as follows:
Financial Assets classified as Available for Sale:
•	 Available for sale investments;
Financial Assets classified as loans and receivables:
•	 Trade receivables;
•	 Other receivables;
•	 Cash and cash equivalents
Financial Liabilities all classified as held at amortised cost:
•	 Trade payables;
•	 Other payables;
Financial assets
Group Company
2011
€’000
2010
€’000
2011
€’000
2010
€’000
Available for sale assets
Available for sale investment(*) 34 34 – –
Loans and receivables
Trade receivables* 1,994 662 – –
Other receivables* 1,725 811 – _
Amounts due from Group undertakings* – – 17,879 19,013
Cash and cash equivalents* 3,703 2,810 2,464 1,221
7,422 4,283 20,343 20,234
Financial liabilities
Group Company
2011
€’000
2010 
€’000
2011
€’000
2010
€’000
Trade payables* 6,572 3,169 146 81
Other payables and accruals* 3,645 2,356 53 254
Derivative element of convertible loan note(*) – 11 11
Debt component of convertible bonds* – 10,767 – 10,767
Warrant derivative(*) – 17 – 17
Drawdown of debt facility* – 9,584 – 9,584
10,217 25,904 199 20,714
* Carried at amortised cost
(*) Carried at fair value through profit or loss
Notes forming part of the financial statements continued
For the year ended 31 December 2011 49
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Fair value of financial instruments
At 31 December 2011 and 31 December 2010, the fair value and book value of the Group’s financial assets and liabilities were materially the 
same. All financial assets and liabilities indicated above with a * are shown in the statement of financial position at their amortised costs, 
which approximates to underlying fair value. Financial instruments listed above valued at fair value are assessed as tier 3. Tier 3 means 
inputs for the asset or liability that are not based on observable market data.
Where carried at fair value through profit or loss as indicated by (*) the financial instruments are assessed as tier 2. A tier 2 classification 
means that inputs are other than quoted prices that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. 
derived from prices) (Level 2). All financial liabilities carried at fair value through the profit and loss were settled in the current year. Therefore 
no fair value adjustments have been recognised in the current period.
Financial risk management
General objectives, policies and processes
The Board has overall responsibility for the determination of the Group’s risk management objectives and policies and, whilst retaining 
responsibility for them it has delegated the authority for designing and operating processes that ensure the effective implementation of the 
objectives and policies to the Group’s finance function. The Board receive regular updates from our accounting and financial management 
through which it reviews the effectiveness of the processes put in place and the appropriateness of the objectives and policies it sets. The 
overall objective of the Board is to set policies that seek to reduce risk as far as possible without unduly affecting the Group’s 
competitiveness and flexibility. Further details regarding these policies are set out below.
The key financial instruments for the Company are the current receivables related to subsidiaries and as a result, Company reports are only 
included where relevant.
Credit risk
Credit risk is the risk of financial loss to the Group if a customer or a counter party to a financial instrument fails to meet its contractual 
obligations. The Group is mainly exposed to credit risk from credit sales in relation to gas production. It is Group policy, implemented locally, 
to assess the credit risk of new customers before entering contracts in accordance with best local business practices, and seek external 
credit ratings where applicable and when available. Credit risk of existing customers is assessed when deemed necessary.
Credit risk also arises from cash and cash equivalents and deposits with banks and financial institutions. For banks and financial 
institutions, only independently rated parties with an acceptable rating are utilised. It is the Group policy that it endeavours to maintain 
substantial bank deposits and bills with financial institutions with Standard & Poors ‘A’ rating or equivalent. The Group holds cash 
balances with Banca Intesa SanPaolo SpA (Standard & Poors rating BBB+/A-2), to meet minimum working capital requirements for the 
Italian operations.
Interest rates received on deposit accounts held with HSBC, Banca Intesa SanPaolo and Deutsche Bank are between 0.25% and 1.04%  
(31 December 2010: 0% to 0.6%), based on bank interest rates.
The Group does not enter into derivatives to manage credit risk, although in certain isolated cases may take steps to mitigate such risks if it 
is sufficiently concentrated.
Financial assets: Ageing
Group
2011
€‘000
2010
€‘000
1 month 6,673 3,770
2/3 months 736 478
4/6 months 13 35
7,422 4,283
The Group has not historically suffered defaults from its customers for onshore gas production. The Group faces credit risk through onshore 
gas sales to Gas Plus Italiana and joint venture cash calls to Edison and Gas Plus Italiana, arising from various joint venture projects where 
Medoilgas Italia SpA acts as operator. The Group’s main credit risk exposure through its subsidiary Medoilgas Italia SpA, is with Repower 
Italia S.p.A. (‘Repower’) which at present purchases the Group’s entire offshore gas production from the Guendalina gas field which 
commenced gas production in Q4, 2011. Price risk under this contract is mitigated by the provision of a bank guarantee in favour of the 
Group in respect of a material proportion of forecast gas purchases under the contract. Management believes the credit risk currently faced 
by the Group is low given the high credit worthiness of Gas Plus Italiana, Edison and Repower. Gas Plus Italiana is a major Italian gas 
supply company listed on the Borsa Italiana and public filings indicate it has good creditworthiness.
The Group from time to time reviews whether a greater utilisation of credit ratings would be appropriate. Given that much of the Group’s 
trade receivables are under joint operating agreements, the security against joint venture assets provided by those agreements adequately 
mitigates any risk of default. At the reporting date, the Group does not envisage any losses from non-performance of existing 
counterparties. 50
Mediterranean Oil & Gas Plc Annual Report 2011 www.medoilgas.com
18 Financial instruments – risk management (continued)
It is considered that given the presently challenging macroeconomic position in the Eurozone and in Italy, credit risk has been elevated as at 
the reporting date, compared to the previous year end but that this risk has not had a material impact on earnings or shareholders’ equity. 
Management continues to monitor the financial and energy market conditions and will consider any steps required to mitigate associated 
risks to the Group.
The Group seeks to maintain deposit accounts for its cash balances, primarily with banks which hold a high credit rating. The applicable 
interest rate on cash balances is also considered. Current bank deposits are held primarily with HSBC Bank plc and Deutsche Bank AG, 
with funds necessary for adequate working capital availability to the Italian operations held on deposit with Banca Intesa SanPaolo. 
Funds which are not expected to be required in the near term are placed on short-term (i.e. up to 90 days) deposit with fixed interest rates 
for the relevant term, which reduce the Group’s exposure to interest rate risk. At the same time, management reviews the Group’s forecast 
cashflows in order to ensure that the maximum level of interest is received for the available funds but without adversely affecting the 
working capital flexibility the Group requires. There is no material difference between the book value and fair value of the Group’s cash and 
cash equivalents.
A 1% interest rate movement does not have a material effect on the Group’s financial assets and liabilities therefore no sensitivity analysis 
is provided.
Cash flow interest rate risk
The Group and Company are exposed to cash flow interest rate risk from deposits of cash and cash equivalents with banks. The cash and 
cash equivalents balances maintained by the Group are proactively managed in order to ensure that the maximum level of interest is 
received for the available funds but without affecting the working capital flexibility the Group requires.
There is no material difference between the book value and fair value of the Group’s cash and cash equivalents.
Foreign exchange risk
Foreign exchange risk arises because the Group has operations located in various parts of the world and because some of its major 
suppliers utilise contracts denominated in US dollars irrespective of the location where services are provided. Although its geographical 
spread reduces the Group’s operational risk, the Group’s net assets arising from such overseas operations are exposed to currency risk 
resulting in gains and losses on retranslation into Euro. Only in exceptional circumstances will the Group consider hedging its net 
investments in overseas operations as generally it does not consider that the reduction in foreign currency exposure warrants the cash flow 
risk created from such hedging techniques. It is the Group’s policy to ensure that individual Group entities enter into local transactions in 
their functional currency wherever possible or acquire the relevant contract currency ahead of the expenditure obligation. The Group 
considers this policy minimises any unnecessary foreign exchange exposure.
The Board continues to monitor the effectiveness of this policy on an ongoing basis through its approval of both corporate and capital 
expenditure budgets, review of the currency profile of cash balances, and management accounts.
Part of the Group’s borrowings, during the year ended 31 December 2011, was denominated in Sterling and the functional currency of the 
loan counterparty is the Euro. The Group is therefore exposed to changes in exchange rates. A total foreign exchange gain of €435,000 
(2010: loss of €549,000) was recognised in the year in respect of the translation of monetary assets and liabilities not denominated in Euro.
The proportion of cash and cash equivalent balances held in Euro as at 31 December 2011 was 36.4% (2010: 98%), USD 41.8%, GBP 21.8%. 
The former liabilities denominated in Sterling related to the convertible bonds and the convertible loan notes (€10.767m) have been 
converted into equity after the financial restructuring completed on 10 May 2011. 
At 31 December 2011, the currency exposure of the Group was as follows:
AUD
€’000
USD
€’000
GBP
€’000
EURO
€’000
Total
€’000
At 31 December 2011
Cash and cash equivalents – 1,548 807 1,348 3,703
Trade and other receivables – 330 – 3,389 3,719
Trade and other payables (3) (2,880) (144) (7,190) (10,217)
Other financial liabilities – – – – –
Net financial assets/(liabilities) (3) (1,002) 663 (2,453) (2,795)
€ weakens 10% (3) (1,102) 729 (2,453) (2,829)
€ strengthens 10% (3) (902) 597 (2,453) (2,761)
At 31 December 2010
Cash and cash equivalents – – 8 2,802 2,810
Trade and other receivables – – – 1,426 1,426
Trade and other payables (9) (242) (76) (2,842) (3,169)
Other financial liabilities – – (10,767) (9,584) (20,351)
Net financial assets/(liabilities) (9) (242) (10,835) (8,198) (19,284)
€ weakens 10% (10) (266) (11,918) (8,198) (20,392)
€ strengthens 10% (8) (218) (9,752) (8,198) (18,175)
Notes forming part of the financial statements continued
For the year ended 31 December 2011 51
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Significant balances are held in foreign currencies. The Directors have considered the exposure resulting from movements in foreign 
exchange rates in relation to these amounts. A movement of 10% has been assessed and is disclosed in the table above.
Liquidity risk
Liquidity risk arises from the Group’s management of working capital and the finance charges and principal repayments on its debt 
instruments.
The Group’s policy is to ensure that it will always have sufficient cash to allow it to meet its liabilities when they become due. To achieve this 
aim, it seeks to maintain readily available cash balances (or agreed facilities) to meet expected requirements. See further information on 
Going Concern in Note 1.
Cash forecasts identifying the liquidity requirements of the Group are produced monthly. These are reviewed regularly by management 
and the Board to ensure that sufficient financial headroom exists.
The contractual undiscounted amounts of financial liabilities are repayable as follows:
Group Company
2011
€’000
2010 
€’000
2011
€’000
2010 
€’000
1 month 3,705 286 84 67
2/3 months 6,094 4,172 186 268
4/6 months 56 4 – –
6/12 months 362 21,704 19,433 20,641
In more than one year but not more than two years – – – _
10,217 26,166 19,703 20,976
In respect of the Company, included in Euro amounts receivable within one year are amounts due from group companies totalling €17 .0m 
(2010: €19.0m).
Price risk 
Gas sales revenue is subject to energy market price risk. The Group’s gas revenues are sourced from the sale of gas under term 
supply contracts.
Estimated production volumes for sales of onshore gas production are set out in the contracts. The applicable gas price for each month is 
set according to a formula which is linked to the oil price that applies a constant to the average oil price from fuel oil, gas oil and crude oil 
(Brent) prices over each of the 9 months prior to the actual month of gas delivery. The oil prices which are applied in the formula are sourced 
from the Platts Oilgram Price Report (average of the highest and lowest for each oil type in each of the 9 prior months) in US$ and 
convertible to Euro value by reference to the average monthly US$/€ exchange rate, which is in the actual month of gas supply, as 
published by the European Central Bank. Given the gas price formula for onshore gas sales is based on an oil price formula which takes an 
average measure of the prior 9 month period, any short-term material oil price fluctuations are likely to be mitigated. At present, the Group 
does not intend to hedge oil price risk in the short term.
The current offshore gas sale contract in respect of the Group’s interest in the Guendalina gas field terminates on 30 September 2013. This 
contract is similar to the Group’s contracts for the sale of onshore gas production and it is set to a benchmark of Italian energy market prices 
identified by a specific formula, in which the price is calculated by reference to oil-linked benchmarks and the €/$ exchange rate. 
Defaults and breaches
There have been no defaults or breaches in respect of current and non-current liabilities recognised at the reporting date.
Capital disclosures
The Group seeks to maintain sufficient capital to fund its growth and safeguard its ability to continue as a going concern. The primary 
objective of the Group is to maximise shareholder value, which from a capital management perspective, is achieved by maintaining the 
capital structure that is most suited to the Group’s size, project and strategic priorities, as well as underlying business risk.
Currently, the Group does not pay dividends, focusing instead, on delivering capital growth by developing its exploration portfolio and its 
Italian development assets, to optimise future returns. As at 31 December 2011 and the date of this report, the capital employed by the 
Group to fund projects is comprised solely of equity attributable to shareholders. Management will continue to review the scope to apply 
other sources of capital and equity finance, such as potential farm outs, to support key projects. The details and movements in the 
Company’s share capital are set out in Note 20. 52
Mediterranean Oil & Gas Plc Annual Report 2011 www.medoilgas.com
19 Provisions for liabilities and charges 
Decommissioning 
€’000
Amounts 
payable to 
employees/
Other 
provisions 
€’000 Total €’000
At 1 January 2010 7,146 193 7,339
New provisions and changes in estimates (1,421) 46 (1,375)
Utilisation 47 (80) (33)
Unwinding of discount factor 738 – 738
At 31 December 2010 and 1 January 2011 6,510 159 6,669
Changes in estimates (468)  45 (423)
New provision 1,156 409 1,565
Utilisation – (45) (45)
Unwinding of discount factor 610 – 610
At 31 December 2011 7,808 568 8,376
The decommissioning provision is the discounted present value of the estimated cost of decommissioning the Group’s oil and gas 
production facilities in Italy. The discount factor used is 10%. The Group makes provision for the cost of decommissioning its producing wells 
at the completion of their useful lives. There are in excess of 30 wells for which provision has been made. Individual final decommissioning 
costs vary. Decommissioning of the wells is anticipated over a 10 year period with additional provision to be made as new production wells 
are brought on stream. The time frame for decommissioning is based upon the projected production profile and remaining proved and 
probable reserves. The costs of decommissioning both onshore and offshore wells are certified by independent qualified engineers 
and specialists. 
The decommissioning provision for the year ended 31 December 2011 has decreased by €0.468m, due primarily to an extension in the 
independently certified forecast timetable for the decommissioning and abandonment of the Group’s onshore producing fields. A new 
provision (€1.156m) was made in the period following the commencement of production from the Guendalina onshore gas field.
Amounts payable to employees are in respect of the Group’s estimated liability to employees when they cease employment.
A provision for €409,000 (2010: nil) has been recognized in relation to the Group’s potential liability through the subsidiary Malta Oil Pty Ltd 
for the relinquishment of the Medjerda licence in Tunisia.
20 Share capital
Issued and fully paid
2011
Number
2011
€’000
2010
Number
2010
€’000
Ordinary shares of 0.01p each
At 1 January 38,912,736 11,285 38,912,736 11,285
Share consolidation – (10,721)
Issued in the period – fundraising 333,333,333 3,866 – –
Issued in the period – settlement of debt 40,919,558 469 – –
Issue of shares – commission shares 15,952,083 159 – –
At 31 December 429,117,710 5,058 38,912,736 11,285
On 10 May 2011, the Group raised £20m before expenses (approximately £19.1m net of cash transaction expenses) by the subscription for 
333,333,333 new ordinary shares in the Company (the ‘Subscription’) at 6 pence each (‘Subscription Price’). In addition, the Company 
agreed terms with the Bank of Scotland Plc (‘BoS’), Stark Select Asset Master Limited (‘Stark Select’) as holder of the convertible bonds 
(‘Convertible Bonds’), and with holders of the convertible loan notes (‘CLNs’), as a result of which, all outstanding amounts due to the BoS 
under the BoS bank facility were settled and all outstanding Convertible Bonds and CLNs were converted into new ordinary shares 
(together, the ‘Conversion Shares’) of the Company at a price of 24 pence per new ordinary share (together, the ‘Group Recapitalisation’). As 
a result of the Group Recapitalisation, the Group does not have any outstanding financial debt.
The nominal value of the existing ordinary shares as at 31 December 2010, was 20 pence. The issue of new shares at the Subscription Price 
therefore required the adjustment of the nominal value of each of the Company’s ordinary shares to 1 penny, rather than 20 pence.
The gross proceeds of the £20m equity raise were used to fund the Group’s required capital expenditure for the Guendalina project (MOG: 
20% interest), settlement of the bank facility with BoS, the Group Recapitalisation expenses and the Group’s working capital needs.
Notes forming part of the financial statements continued
For the year ended 31 December 2011 53
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Conversion of convertible bonds and convertible notes
The holder of all of the outstanding Convertible Bonds, Stark Select, agreed to convert the whole of the outstanding principal amount of its 
Convertible Bonds into 19,858,333 Conversion Shares at a price of 24 pence per Conversion Share.
With the approval of an extraordinary resolution of the holders of the CLNs, the Company agreed to amend the deed poll constituting the 
CLNs to give the Company the right to convert the outstanding CLNs at its election into 21,061,225 Conversion Shares, at a price of 24 pence 
per Conversion Share. The Company elected to convert all of the outstanding CLNs.
The original conversion prices of the CLNs and the Convertible Bonds were 40 pence and 50 pence respectively and the Company had no 
right to require conversion. The amendments to the terms and conversion prices of the CLNs and the Convertible Bonds were necessary to 
enable the Subscription and the Debt Cancellation to take place. The Conversion Shares were issued credited as fully paid, subject to the 
memorandum of association and Articles of the Company and rank pari passu in all respects with new ordinary shares then in issue, 
including the right to receive any future dividends and other distributions.
Share consolidation
The Subscription Price of 6 pence was below the nominal value of the ordinary shares of the Company, of 20 pence. As Company law 
prohibits the issue of shares at a price less than their nominal value, in order to effect the Subscription, a share consolidation was 
undertaken whereby each ordinary share of the Company was subdivided into one new ordinary share with nominal value of 1 penny and 
one deferred share with nominal value of 19 pence (the ‘Share Consolidation’).
The Share Consolidation resulted in 38,912,736 new ordinary shares and 38,912,736 deferred shares (the ‘Deferred Shares’) being in issue 
immediately following the Share Consolidation but before the completion of the Group Recapitalisation.
After the implementation of the Share Consolidation the nominal value of each new ordinary share was one twentieth of that of each 
existing ordinary share. Each new ordinary share has the same rights (including voting and dividend rights and rights on a return of capital) 
as each ordinary share existing prior to completion of the Group Recapitalisation.
The rights attaching to the Deferred Shares, which have not been admitted to trading on AIM, are minimal, thereby rendering them 
effectively valueless. The rights attaching to the Deferred Shares are summarised as follows:
•	 they do not entitle holders to receive any dividend or other distribution or to receive notice of, attend, speak at or vote at general 
meetings of the Company;
•	 on a return of assets on a winding up, they will only entitle the holder to the amounts paid up on such shares after the repayment of 
£10m per New Ordinary Share;
•	 they authorise the Company to appoint any person to execute on behalf of the holders of the Deferred Shares a transfer of such shares 
to the Company, or such person as the Company may nominate as custodian, without any payment therefore and without the sanction 
of the holders of the Deferred Shares; and
•	 the creation and issue of further shares which rank equally or in priority to the Deferred Shares or the passing of a resolution of the 
Company to cancel the Deferred Shares or to effect a reduction in capital shall not constitute a modification or abrogation of their rights.
There are no immediate plans to purchase or cancel the Deferred Shares, but the Company may seek to do so in the future.
The Group’s policy is to utilise options as part of the management reward structure. Option terms are set by agreement with an incoming 
executive or based upon the recommendations of the remuneration committee to the Board of Directors, for existing management. No 
options have been exercised in the year (2010: none).
21 Notes supporting cash flow statement
Cash and cash equivalents comprise:
Group Company
2011
€’000
2010 
€’000
2011
€’000
2010 
€’000
Cash available on demand 3,703 2,810 2,464 1,221 54
Mediterranean Oil & Gas Plc Annual Report 2011 www.medoilgas.com
22 Share-based payment
This note is presented in Sterling, unless otherwise stated, as this is the currency in which shares are issued and options are priced.
The Company has previously operated an equity-settled share based remuneration scheme for employees and contractors in the form of 
an unapproved scheme. On 11 March 2010, the Company adopted a new Global Share Option Plan with the intention that future equity-
settled share based remuneration awards will be made under this new plan.
No new options were granted in the period (refer to Note 26 for options granted post 31 December 2011). 
2011 
Weighted 
average 
exercise 
price 
£
2011 
Number 
2010 
Weighted 
average 
exercise 
price 
£
2010 
Number 
Outstanding at beginning of the year 1.74 2,177,500 2.38 1,598,500
Granted during the year – – 0.45 755,000
Lapsed 1.92 (351,500) 2.00 (176,000)
Outstanding at the end of the year 1.71 1,826,000 1.74 2,177,500
The exercise price of the options outstanding at the end of the year ranged between £0.45 and £3.00 (2010: £0.45 and £3.00) and their 
weighted average contractual life was 2.12 years (2010: 3.09 years). The average weighted share price of the options exercised to 
December 2011 was £1.00 (2010: £1.00). No options were exercised in 2011.
Of the total number of options outstanding at the year-end, 1,826,000 were exercisable (2010: 1,422,500). The weighted average fair value of 
each option granted during the period was £nil (2010: £0.247).
The following is relevant in the determination of the fair value of options granted during the prior year under the Global Share Option Plan 
operated by the Group. No new options were granted in 2011.
11 March 
2010 
£
Equity-Settled
Option pricing model used Black-Scholes
Weighted average share price at grant date 0.415
Exercise Price 0.45
Weighted average contractual life (years) 5.00
Expected volatility 70%
Expected dividend growth rate –
Risk free rate 4.23%
Volatility has been based on the historic performance of the Company and its peer group companies.
2011
€‘000
2010
€’000
The share-based remuneration expense (Note 9) comprises:
Equity-settled schemes 39 217
23 Operating lease arrangements 
Group
2011
€’000
2010
€’000
Minimum lease payments under operating leases recognised in income statement for the year 318 332
Minimum lease payments under operating leases
Due within one year 236 12
After one year but within two years 214 –
After two years but within five years 412 144
Due after five years 359 949
At 31 December 1,221 1,105
The operating leases relate to office rentals and licence concessions. 
Notes forming part of the financial statements continued
For the year ended 31 December 2011 55
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24 Non cash transactions
During the period the Group entered into several significant transactions as part of the Group Recapitalisation that did not result in the 
payment of cash. These are set out below:
a)  Convertible debt (comprising convertible bonds and convertible loan notes) which had a carrying value of €10.9m was extinguished by 
the issue of 40.9m ordinary shares with a fair value of €2.8m. This has given rise to an amount of €8.1m being recognised as a capital 
contribution by current shareholders.
b)  An IFRS 2 charge has arisen on the issue of 15.9m new nil cost shares to parties involved in the Group Recapitalisation transaction in the 
period. The amount of the charge was €2.2m which has been recognised in the share premium account as a cost of issuing shares.
25 Related parties
The Company has entered into a number of unsecured related party transactions with its subsidiary undertakings. The transactions carried 
out between the Company and its subsidiary undertakings are for short and long term financing, details of such transactions and amounts 
owed to and from these entities are provided in Notes 15, 16 and 19.
Information regarding the remuneration of key management personnel and their connected persons is disclosed in Note 10.
Group recapitalisation
As part of the Group Recapitalisation, the following related party transactions occurred:
Immediately prior to the Group Recapitalisation, Michael Bonte-Friedheim, a Director, held 338,000 ordinary shares. In addition, he 
controlled MBF Strategy Limited, which then held convertible notes. Upon admission of new ordinary shares pursuant to the Group 
Recapitalisation (‘Admission’), the convertible notes held by Mr Bonte-Freidheim had outstanding principal (including capitalised interest) of 
£154,894 and converted into 645,391 new ordinary shares (‘Conversion Shares’). MBF Strategy Limited also held warrants over 325,000 
ordinary shares exercisable at 45p per ordinary share. MBF Strategy Limited subscribed £150,000 for new ordinary shares at 6p per share 
(the ‘Subscription Price’), as part of the Group Recapitalisation (‘Subscription Shares’).
Chris Kelsall, a Director of the Company, subscribed £20,000 for Subscription Shares at the Subscription Price. Michael Seymour, appointed 
a Director of the Company on 10 May 2011, subscribed £880,000 for Subscription Shares at the Subscription Price. 
Miles Donnelly, appointed a Director of the Company on 10 May 2011, and his associates in aggregate subscribed £899,500 for 
Subscription Shares at the Subscription Price. 
Matthew Clarke, appointed a Director of the Company on 13 October 2011, subscribed £90,000 for Subscription Shares at the 
Subscription Price. 
Under the AIM Rules for Companies, each of Michael Bonte-Friedheim and Chris Kelsall were treated as a related party of the Company. 
With the exception of Michael Bonte-Friedheim in respect of his own participation in the Conversion Shares and the Subscription Shares 
and Chris Kelsall in respect of his own participation in the Subscription Shares, the Directors considered, having consulted with WH Ireland, 
the Company’s nominated adviser at the time of the Group Recapitalisation, that the terms of the Conversion and the Subscription insofar 
as they relate to such related parties were fair and reasonable insofar as Shareholders were concerned.
In connection with the services that Merlin Partners LLP (‘Merlin’), Miles Donnelly, Michael Seymour and Matthew Clarke provided to the 
Company in arranging the Subscription, the Company agreed, conditional upon completion of the Subscription, to pay to such persons a 
commission equal to 5 per cent of funds raised from Subscription Shares issued to such persons and Subscribers introduced by them and 
1.5 per cent of funds raised from Subscription Shares issued to existing Shareholders, holders of Convertible Bonds, holders of Convertible 
Notes or other Subscribers introduced by the Company (‘Services Agreement’). Matthew Clarke was founding partner and, immediately 
prior to the Group Recapitalisation, controlled Merlin. 
It was agreed that the Company’s obligation to pay such commission be discharged by the issue to such persons of new ordinary shares 
at 6 pence per share with a value equal to such commission (‘Commission Shares’). Upon Admission, 2,400,000 Commission Shares were 
issued to Matthew Clarke and his associates, 3,240,000 Commission Shares were issued to Michael Seymour and his associates and 
3,240,000 Commission Shares were issued Miles Donnelly and his associates, pursuant to the Services Agreement.
Och Ziff loan facility
On 8 November 2011, the Company entered into a short-term secured loan facility with affiliates of certain of its substantial shareholders, 
namely affiliated investment funds of Och-Ziff Capital Management Group (‘Och Ziff’), for up to €3.5m (the ‘Loan Facility’). The purpose of the 
Loan was to assist the Company in funding the acquisition of 1,000 sq km of 3D seismic exploration data, in relation to its licence 
commitment at Area 4 Offshore Malta, under the Malta Production Sharing Contract signed with the Maltese Government on 18 July 2008 
and its Addendum signed on 17 May 2011 (the ‘Licence’). 
The initial term of the Loan Facility is eight months and the interest rate payable is 12% per annum. The Loan may be extended for a further 
4 months at a rate of 14% per annum, at the option of the Company. The Loan is secured by a pledge over the entire issued share capital of 
Medoilgas Italia SpA, a wholly owned subsidiary of the Company. The Loan constituted a Related Party Transaction pursuant to the AIM 
Rules. The Directors of MOG consider, having consulted with Panmure Gordon (UK) Limited, MOG’s nominated adviser, that the terms of the 
Loan, as set out, are fair and reasonable insofar as its shareholders are concerned. 56
Mediterranean Oil & Gas Plc Annual Report 2011 www.medoilgas.com
26 Events after the reporting period
Board appointments
Keith Nicholas Henry was appointed a Director of the Company on 16 January 2012. 
Jacob Shields Ulrich was appointed a Director of the Company on 16 January 2012.
William George Higgs was appointed a Director of the Company on 19 March 2012.
Guendalina gas field
•	 On 1 February 2012, 2P recoverable gas reserves were increased by 42% to 31.2 Bcf (6.2 Bcf net to MOG), following issuance of 
independent Competent Person’s Report by RPS Energy Limited, February 2012).
•	 In January 2012, the Group re-sold its entire net gas produced from the Guendalina gas field in December 2011, to ENI S.p.A., which had 
previously been sold to Elettrogas S.p.A. The subsequent adjustments necessary to revenue and accounts receivable have been made 
and are reflected in these financial statements.
Grant of options to directors
•	 On 19 January 2012, 11,500,000 options were granted to directors over ordinary shares of the Company. The options have an exercise 
price of 6 pence and are exercisable between the date of grant and the third anniversary of the date of grant;
•	 On 19 March 2012, 6,000,000 options were granted to William Higgs over ordinary shares of the Company. The options have an exercise 
price of 6 pence and are exercisable between the first and third anniversaries of 19 January 2012;
•	 On 19 January 2012, 2,000,000 options were granted to employees over ordinary shares of the Company. The options have an exercise 
price of 6 pence and are exercisable between the date of grant and the third anniversary of the date of grant; and
•	 The grant of options to directors was as follows:
Director New options granted
Total number of  
options held at the
date of this report
Keith Henry 2,000,000 2,000,000
William Higgs 6,000,000 6,000,000
Sergio Morandi 2,500,000 3,415,000
Chris Kelsall 2,000,000 2,090,000
Matthew Clarke 1,000,000 1,000,000
Salvatore Russo 1,000,000 1,000,000
Miles Donnelly 1,000,000 1,000,000
Michael Seymour 1,000,000 1,000,000
Jacob Ulrich 1,000,000 1,000,000
Ombrina Mare oil and gas discovery
In May 2012, the Italian Ministry for Economic Development granted a three year extension to the exploration permit at Ombrina Mare 
(BR269 GC).
Och Ziff loan facility
On 8 November 2011, the Company entered into a short term secured loan facility with affiliates of certain of its substantial shareholders, 
namely affiliated investment funds of Och-Ziff Capital Management Group (‘Och Ziff’), for up to €3.5m (the ‘Loan Facility’). The purpose  
of the Loan was to assist the Company in funding the acquisition of 1,012 sq km of 3D seismic exploration data, in relation to its licence 
commitment at Area 4 Offshore Malta, under the Malta Production Sharing Contract signed with the Maltese Government on 18 July 2008 
and its Addendum signed on 17 May 2011 (the ‘Licence’). Refer Notes 1 and 25 for further 
27 Contingent liability
There are no contingent liabilities as at the date of this report (2010: nil).
 
Notes forming part of the financial statements continued
For the year ended 31 December 2011 57
Mediterranean Oil & Gas Plc Annual Report 2011 www.medoilgas.com
Notice of Annual General Meeting
NOTICE IS HEREBY GIVEN that the Annual General Meeting of 
Mediterranean Oil & Gas Plc (the ‘Company’) will be held at Prince 
Philip House, The Royal Academy of Engineering, 3 Carlton House 
Terrace, London SW1Y 5DG on 26 June 2012 at 11.00 a.m for the 
following purposes.
As Ordinary Business
To consider and, if thought fit, pass the following resolutions which 
will be proposed as ordinary resolutions. 
1. To receive and adopt the statement of accounts for the year 
ended 31 December 2011 together with the reports of the 
Directors and the auditors thereon.
2. To elect Matthew Clarke, who was appointed since the last 
Annual General Meeting, as a Director of the Company.
3. To elect Keith Henry, who was appointed since the last Annual 
General Meeting, as a Director of the Company.
4. To elect William Higgs, who was appointed since the last Annual 
General Meeting, as a Director of the Company.
5. To elect Jacob Ulrich, who was appointed since the last Annual 
General Meeting, as a Director of the Company.
6. To re-appoint BDO LLP as auditors to act as such until the 
conclusion of the next general meeting of the Company at which 
the requirements of section 437 of the Companies Act 2006 (the 
‘2006 Act’) are complied with and to authorise the Directors of 
the Company (the ‘Directors’) to fix their remuneration.
As Special Business
To consider and, if thought fit, pass the following resolutions of 
which resolution 7 will be proposed as an ordinary resolution and 
resolution 8 will be proposed as a special resolution. 
ORDINARY RESOLUTION
7. That the Directors be generally and unconditionally authorised 
in accordance with section 551 of the 2006 Act to allot Relevant 
Securities (as defined in this resolution) up to an aggregate 
nominal amount of £1,287 ,353, provided that this authority shall, 
unless renewed, varied or revoked by the Company in general 
meeting, expire on the date falling 15 months from the date of 
the passing of this resolution, or if earlier at the Annual General 
Meeting of the Company to be held in 2013, save that the 
Company may at any time before such expiry make an offer or 
agreement which might require Relevant Securities to be allotted 
after such expiry and the Directors may allot Relevant Securities 
to be allotted in pursuance of such offer or agreement 
notwithstanding that the authority hereby conferred has expired. 
This authority is in substitution for all previous authorities 
conferred on the Directors in accordance with section 551 of the 
2006 Act. In this resolution, ‘Relevant Securities’ means any 
shares in the capital of the Company and the grant of any right 
to subscribe for, or to convert any security into, shares in the 
capital of the Company (‘Shares’) but does not include the 
allotment of Shares or the grant of a right to subscribe for Shares 
in pursuance of an employee’s share scheme or the allotment of 
Shares pursuant to any right to subscribe for, or to convert any 
security into, Shares.
SPECIAL RESOLUTION
8. That the Directors be generally empowered, pursuant to section 
570 of the 2006 Act, to allot equity securities (as defined in 
section 560 of the 2006 Act) for cash as if section 561(1) of the 
2006 Act did not apply to any such allotment pursuant to the 
general authority conferred on them by resolution 7 above (as 
varied from time to time by the Company in general meeting) 
PROVIDED THAT such power shall be limited to: 
 (a)  the allotment of equity securities in connection with a rights 
issue or any other offer to holders of ordinary shares in 
proportion (as nearly as may be practicable) to their 
respective holdings and to holders of other equity securities 
as required by the rights of those securities or as the 
Directors otherwise consider necessary, but subject to such 
exclusions or other arrangements as the Directors may 
deem necessary or expedient in relation to treasury shares, 
fractional entitlements, record dates, legal or practical 
problems in or under the laws of any territory or the 
requirements of any regulatory body or stock exchange; and
 (b)  the allotment (otherwise than pursuant to sub-paragraph (a) 
above) of equity securities up to an aggregate nominal 
amount of £1,287 ,353 representing approximately 30% of the 
issued ordinary share capital of the Company
  and the power hereby conferred shall operate in substitution for 
and to the exclusion of any previous power given to the Directors 
pursuant to section 570 of the 2006 Act and shall expire on 
whichever is the earlier of the conclusion of the Annual General 
Meeting of the Company held in 2013 or the date falling 15 
months from the date of the passing of this resolution (unless 
renewed varied or revoked by the Company prior to or on that 
date) save that the Company may, before such expiry make an 
offer or agreement which would or might require equity 
securities to be allotted after such expiry and the Directors may 
allot equity securities in pursuance of such offer or agreement 
notwithstanding that the power hereby conferred has expired.
Registered Office By order of the Board
44 Southampton Buildings Keith Henry
London  Non-Executive Chairman
WC2A 1AP 
24 May 2012
Notes:
1. Pursuant to Regulation 41 of the Uncertificated Securities 
Regulations 2001, the Company specifies that only those 
members registered on the Company’s register of members at 
6.00 p.m. on 22 June 2012 shall be entitled to attend and vote at 
the Annual General Meeting.
2. If you are a member of the Company at the time set out in note 1 
above, you are entitled to appoint a proxy to exercise all or any 
of your rights to attend, speak and vote at the Annual General 
Meeting. You can only appoint a proxy using the procedures set 
out in these notes and the notes to the proxy form.
3. A proxy does not need to be a member of the Company but 
must attend the Annual General Meeting to represent you. 
Details of how to appoint the Chairman of the Annual General 
Meeting or another person as your proxy using the proxy form 
are set out in the notes to the proxy form. If you wish your proxy 
to speak on your behalf at the Annual General Meeting you will 
need to appoint your own choice of proxy (not the Chairman) 
and give your instructions directly to them.
4. You may appoint more than one proxy provided each proxy is 
appointed to exercise rights attached to different shares. You 
may not appoint more than one proxy to exercise rights 
attached to any one share. To appoint more than one proxy, 
please contact the Company’s registrars on the telephone 
numbers set out in Note 7 . 58
Mediterranean Oil & Gas Plc Annual Report 2011 www.medoilgas.com
5. The notes to the proxy form explain how to direct your proxy 
how to vote on each resolution or withhold their vote.
To appoint a proxy using the proxy form, the form must be:
(a) completed and signed;
(b) sent or delivered to Capita Registrars, PXS, The Registry, 34 
Beckenham Road, Beckenham, Kent BR3 4TU; and
(c) received by Capita Registrars no later than 11.00 a.m on  
22 June 2012.
In the case of a member which is a company, the proxy form 
must be executed under its common seal or signed on its behalf 
by an officer of the company or an attorney for the company.
Any power of attorney or any other authority under which the 
proxy form is signed (or a duly certified copy of such power or 
authority) must be included with the proxy form.
CREST members who wish to appoint a proxy or proxies through 
the CREST electronic proxy appointment service may do so for 
the Annual General Meeting to be held at 11.00 a.m. on 26 June 
2012 and any adjournment(s) thereof by using the procedures 
described in the CREST Manual. CREST personal members or 
other CREST sponsored members, and those CREST members 
who have appointed a voting service provider should refer to 
their CREST sponsors or voting service provider(s), who will be 
able to take the appropriate action on their behalf. 
In order for a proxy appointment or instruction made by means 
of CREST to be valid, the appropriate CREST message (a ‘CREST 
Proxy Instruction’) must be properly authenticated in accordance 
with Euroclear UK & Ireland Limited’s specifications and must 
contain the information required for such instructions, as 
described in the CREST Manual. The message must be 
transmitted so as to be received by the Company’s agent, 
Capita Registrars Limited (CREST Participant ID: RA10), no later 
than 11.00 a.m. on 22 June 2012. For this purpose, the time of 
receipt will be taken to be the time (as determined by the time 
stamp applied to the message by the CREST Application Host) 
from which the Company’s agent is able to retrieve the message 
by enquiry to CREST in the manner prescribed by CREST. 
CREST members and, where applicable, their CREST sponsor or 
voting service provider should note that Euroclear UK & Ireland 
Limited does not make available special procedures in CREST for 
any particular messages. Normal system timings and 
limitations will therefore apply in relation to the input of CREST 
Proxy Instructions. It is the responsibility of the CREST member 
concerned to take (or, if the CREST member is a CREST personal 
member or sponsored member or has appointed a voting 
service provider, to procure that his CREST sponsor or voting 
service provider takes) such action as shall be necessary to 
ensure that a message is transmitted by means of the CREST 
system by any particular time. In this connection, CREST 
members and, where applicable, their CREST sponsor or voting 
service provider are referred in particular to those sections of the 
CREST Manual concerning practical limitations of the CREST 
system and timings.
The Company may treat as invalid a CREST Proxy Instruction in 
the circumstances set out in Regulation 35(5)(a) of the 
Uncertificated Securities Regulations 2001.
6. In the case of joint holders, where more than one of the joint 
holders purports to appoint a proxy, only the appointment 
submitted by the most senior holder will be accepted. Seniority 
is determined by the order in which the names of the joint 
holders appear in the Company’s register of members in 
respect of the joint holding (the first-named being the 
most senior).
7. Except as provided above, members who have general queries 
about the Annual General Meeting should call the Capita 
Registrars’ shareholder helpline on 0871 664 0300 or, if calling 
from outside the UK, on +44 (0)20 8639 3399. Lines are open 
from 8.30 a.m. to 5.30 p.m, Monday to Friday. Calls to Capita 
Registrars’ 0871 664 0300 number are charged at 10 pence per 
minute (including VAT) plus any of your service provider’s 
network extras. Calls to Capita Registrars’ +44 (0)20 8639 3399 
number from outside the UK are charged at applicable 
international rates. Different charges may apply to calls made 
from mobile telephones and calls may be recorded and 
monitored randomly for security and training purposes. 
No other methods of communication will be accepted.
8. You may not use any electronic address provided either:
(a) in this Notice of Annual General Meeting; or 
(b) any related documents (including the proxy form),
  to communicate with the Company for any purposes other than 
those expressly stated.
9. As at 5.00 p.m. on the day immediately prior to the date of 
posting of this Notice of Annual General Meeting, the 
Company’s issued share capital comprised 429,117 ,710 ordinary 
shares of 1 penny each and 38,912,736 deferred shares of 19 
pence each. Each ordinary share carries the right to one vote at 
a general meeting of the Company and, therefore, the total 
number of voting rights in the Company as at 5.00 p.m. on the 
day immediately prior to the date of posting of this Notice of 
Annual General Meeting is 429,117 ,710. The deferred shares do 
not carry the right to vote at a general meeting of the Company. 
 
EXPLANATORY MEMORANDUM
1. Items of business 2, 3, 4 and 5 – Matthew Clarke, Keith Henry, 
William Higgs and Jacob Ulrich have each been appointed as 
Directors since the last Annual General Meeting and therefore 
each of them retires from office in accordance with article 23.2 of 
the articles of association of the Company (the ‘Articles’) and will 
stand for reappointment.
2. Item of business 7 – this resolution, in accordance with section 
551 of the 2006 Act, permits the Directors to allot securities 
pursuant to a general authority (not restricted to allotments for 
cash on a non pre-emptive basis which are regulated by section 
570 of the 2006 Act). The proposed authority represents an 
authority to allot Relevant Securities with an aggregate nominal 
value of £1,287 ,353, being approximately 30% of the issued 
ordinary share capital of the Company as at the date of the 
Annual General Meeting. This authority will expire at the next 
Annual General Meeting of the Company.
3. Item of business 8 – this resolution authorises the Directors to 
allot the securities it is authorised to allot pursuant to resolution 
7 for cash on a non-pre-emptive basis. This authority represents 
approximately 30% of the issued ordinary share capital of the 
Company as at the date of the Annual General Meeting. This 
authority will expire at the next Annual General Meeting of the 
Company.
4. The Directors cannot issue securities representing more than 
30% of issued ordinary share capital of the Company pursuant 
to resolutions 7 and 8.
Notice of Annual General Meeting continued 59
Mediterranean Oil & Gas Plc Annual Report 2011 www.medoilgas.com
ANNUAL REPORT AND FINANCIAL STATEMENTS 
For the 12 months ended 31 December 2011
DIRECTORS
Mr. Keith Henry Non-Executive Chairman, appointed 16 January 2012
Dr. Bill Higgs Chief Executive, appointed 19 March 2012
Mr. Sergio Morandi Chief Operating Officer
Mr. Chris Kelsall Finance Director
Mr. Miles Donnelly Non-Executive Director, appointed 10 May 2011
Mr. Michael Seymour Non-Executive Director, appointed 10 May 2011
Mr. Salvatore Russo Non-Executive Director
Mr. Matthew Clarke Non-Executive Director, appointed 13 October 2011
Mr. Jake Ulrich Non-Executive Director, appointed 16 January 2012
COUNTRY OF INCORPORATION OF PARENT COMPANY  
AND DOMICILE
Great Britain
LEGAL FORM
Public limited company
REGISTERED OFFICE 
44 Southampton Buildings 
London WC2A 1AP
LONDON OFFICE
16 Old Queen Street, 
London SW1H 9HP
COMPANY SECRETARY
Emcee Nominees Limited 
44 Southampton Buildings  
London WC2A 1AP
BROKERS
Panmure Gordon & Co 
Moorgate Hall 
155 Moorgate 
London EC2M 6XB
GMP Securities Europe LLP
Stratton House,
5 Stratton Street
London W1J 8LA
NOMINATED ADVISER
Panmure Gordon & Co 
Moorgate Hall 
155 Moorgate 
London EC2M 6XB
AUDITORS
BDO LLP
55 Baker Street
London W1U 7EU
PR AGENCY
Pelham Bell Pottinger
5th Floor, Holborn Gate
330 High Holborn
LONDON UK WC1V 7QD
REGISTRARS
Capita Registrars Limited Capita Registrars,
The Registry,
34 Beckenham Road,
Beckenham, 
Kent, BR3 4TU
SOLICITORS TO THE COMPANY
Memery Crystal LLP Studio Legale Ughi e Nunziante
44 Southampton Buildings Via Venti Settembre, 1
London WC2A 1AP Rome 00197 – Italy
Corporate directory 60
Mediterranean Oil & Gas Plc Annual Report 2011 www.medoilgas.com
Notes 01-17
Business review
01 Highlights
02 The Company at a glance
04 Our strategy for growth
06 Chairman’s statement
08 Chief Executive’s report
14 Financial review
16 Principal risks and uncertainties
18-25
Corporate governance
18 Board of Directors
20 Senior management
21 Directors’ report
23 Corporate governance statement
24 Remuneration report
26-56
Financial statements
26 Independent auditors’ report
27 Financial statements
57 Notice of Annual General Meeting
59 Corporate directory
FSC Logo  Registered office
C/- Emcee 
44 Southampton Buildings 
London UK  
WC2A 1AP
Operations Office – Rome  London Office
Via Cornelia 498  16 Old Queen Street
Roma 00166  London UK
Italy SW1H 9HP
www.medoilgas.com
Building a  
resource  
factory
Annual Report 2011
Mediterranean Oil &Gas Plc Annual Report 2011