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Sacoil Holdings Limited - Reviewed Interim Results For The Six Months Ended 31 August 2012

Release Date: 21/11/2012 17:00:00      Code(s): SCL     
SacOil Holdings Limited
(Incorporated in the Republic of South Africa) (Registration number 1993/000460/06)
JSE share code: SCL      AIM share code: SAC ISIN: ZAE000127460
("SacOil" or "the Company" or "the Group")

Reviewed interim results
for the six months ended
31 August 2012

SacOil, the African independent upstream oil and gas company, 
is pleased to announce its reviewed financial results for the 
six months ended 31 August 2012.

Highlights

- Block III, DRC: Successful acquisition of an airborne gravity and magnetic survey,
  post period-end;

- OPL 233, Nigeria: Seismic acquisition on part of the block and successful
  posting of performance bond;

- OPL 281, Nigeria: Restructuring of farm in agreement, reducing
  capex requirement from SacOil;

- Greenhills Plant: Disposal of non-core manganese plant to management
  and employees for R7 million, post period-end;
  
- Successful resolution of Identiguard litigation matter with SacOil awarded
  judgement in its favour and costs; and
  
- Comprehensive loss attributable to owners of the parent of R12.6 million
  (2011: R100.1 million restated)

Commenting, Robin Vela,                                                        
Chief Executive of SacOil said:
"We have continued to make good progress over the last six months albeit in challenging times 
in debt and capital markets for junior exploration companies. On our nearer term producing 
assets, we successfully posted the US$25 million performance bond on OPL 233 in Nigeria, 
enabling us to move forward with the acquisition of 3D seismic data, which will form the 
basis for drilling our first well. We have also acquired further 3D seismic data covering a 
portion of the block, which suggests additional prospectivity. On the high impact Block III in 
the DRC, Total the operator, successfully completed an airborne gravity and magnetic survey, which 
will form the basis for a 2D seismic programme. Concurrently, we have disposed of the loss-making 
non-core Greenhills Manganese Processing Plant, allowing management and capital resources to be 
focused on the core oil and gas business. With solid work programmes in place on our blocks, we 
look forward to reporting further progress in the next period."

Introduction
SacOil's vision is to build a balanced hydrocarbon exploration and production portfolio using the Company's African
heritage as a competitive advantage at the point of entry. The Company's strategic objectives are the development,
exploration and production of discovered oil and gas assets with existing or near-term production, cash and revenue
potential balanced with some exposure to high impact exploration. To that end, the Company has interests in three oil
concessions  Block III, Albertine Graben in the Democratic Republic of Congo ("DRC") and OPL 233 and OPL 281
in Nigeria.

Oil and gas assets
Block III, Albertine Graben, DRC
At the beginning of 2012, the Government of the DRC granted a Presidential Ordinance to Total E&P RDC ("Total"), the
operator of Block III, for their 60% interest. Pursuant to the Presidential Ordinance, the work programme for 2012 was
consequently approved by the Block III Operations Committee, including a budget of $30 million. The main item in the
2012 work programme was the acquisition of a gravity and magnetic survey over the northern part of Block III outside
the Virunga National Park, which was completed in September this year, post period-end. Preliminary processing of the
data broadly confirms the existence of the rift graben on trend with the adjacent concessions in Uganda. On completion
the survey will form the basis for planning a prolific 2D seismic survey.

Following the farm-out of Block III to Total in March 2011, SacOil is carried for the entire work programme and will not
be required to contribute any further capital into this project until a development plan is put in place.

On 12 March 2012, Total acquired a further 6.66% effective interest in Block III from Semliki Energy SPRL ("Semliki"),
a special purpose vehicle jointly owned by SacOil and DIG Oil (Proprietary) Limited ("DIG"), for a cash consideration of
US$10 million and future contingent bonuses amounting to US$11.3 million. Pursuant to the acquisition, Total's holding
in Block III increased to 66.66%, whereas SacOil's effective interest in Block III remains unchanged at 12.5%. DIG's
holding reduced to 5.84% and the DRC Government retains a 15.0% interest in the asset. As a result of this transaction,
Semliki, a company incorporated in the DRC and through which SacOil and DIG own their interests in Block III, is now
owned 68% by SacOil and 32% by DIG.

OPL 233, Nigeria
On 17 April 2012, SacOil procured from Ecobank a US$25 million Performance Bond ("the Bond") as part of its
farm in obligation for a 20% interest in OPL 233. The Bond was provided to Nigdel United Oil Company Limited
("NIGDEL") to fulfil its obligations under the Production Sharing Contract ("PSC"). The Bond was payable to the Nigerian
National Petroleum Corporation ("NNPC"). The successful posting of the Bond allows the partners to proceed with the
acquisition of up to 100 km2 3D Ocean Bottom Cable ("OBC") seismic survey. Results of this survey are expected to
enable the optimum placement of a well to appraise the Olobia-1 oil discovery.

In addition, during this period the OPL 233 joint venture gained access to a portion of an OBC Seismic acquired by
Chevron, which extends into OPL 233 from the adjacent oil producing Chevron operated OML 86 concession. SacOil
is in the process of reviewing this data in more detail but an initial study conducted by Atlantic Subsurface, a National
Petroleum Investment Management Services ("NAPIMS") approved consulting firm, suggests additional prospectivity in
the block, with the identification of the Olobia West prospect. SacOil and its partner Energy Equity Resources ("EER")
also intend to acquire at least 100 km2 3D OBC Seismic as part of the farm in obligation for their respective 20%
interests in OPL 233.

During the next period SacOil will undertake a resource update following the analysis of data collected from the Chevron
OBC survey and the new OBC survey to be acquired.

SacOil has a 20% share in OPL 233 subject to government consent, following which SacOil and EER will have to fulfil
their joint farm-in obligation to pay NIGDEL a remaining farm-in fee of US$9.1 million. SacOil is carrying EER's obligation
of US$4.0 million until first oil date at an interest rate of 25% nominal annual compounded monthly ("nacm").

A gross work programme budget of US$25 million is estimated for the one year extension period of phase 1 of the
exploration period (granted by NNPC on 14 November 2012) and involves the acquisition of 3D OBC and the drilling of
at least one well. SacOil's share of this is US$12.5 million.

In relation to OPL 233, the remaining summary financial obligations on SacOil are as follows:
  
 US$9.1 million to fulfil farm-in obligations of both SacOil and EER post-governmental consent/receipt of definitive
  title; and
  
 US$12.5 million to fund its share of the work programme over the next year.

By posting the performance bond, SacOil has enabled the joint venture to retain the licence, together with a one year
extension to phase 1 of the exploration programme expiring on 15 November 2013.

OPL 281, Nigeria
On 8 February 2012, SacOil agreed revised terms for its partnership with Transnational Corporation of Nigeria PLC
("Transcorp") and EER.

Highlights of the revised terms of the farm-in to licence OPL 281 are as follows:
  
 a reduction in farm-in costs for SacOil and EER from US$32.50 million to US$24.50 million. SacOil has already paid
  US$12.50 million of this amount;
  
 Transcorp will remain the operator of OPL 281 and will pay its 60% share of the capex costs to first production as
  opposed to SacOil and EER carrying 100% of these costs as previously agreed; and
  
 Transcorp to post the performance bond to the Nigerian Government.

SacOil has a 20% share in OPL 281 subject to government consent, following which SacOil will have to fulfil its farm-in
obligation to pay Transcorp a remaining farm-in fee of US$12.0 million on behalf of SacOil and EER. SacOil is carrying
EER's obligation of US$12.25 million until first oil date at an interest rate of 25% nacm.

A gross work programme budget of US$15.0 million is estimated for phase 1 of the exploration period and involves the
reprocessing of the existing 3D seismic data and the drilling of at least one well. SacOil's share of this is US$3.0 million.
In relation to OPL 281, the remaining summary financial obligations on SacOil are as follows:
  
 US$12.0 million to fulfil farm-in obligations of both SacOil and EER post governmental consent/receipt of definitive
  title; and
  
 US$3.0 million to fund its share of the work programme over the next year.

Other assets  Greenhills Manganese Processing Plant ("Greenhills Plant" or the "Plant")

The Greenhills Plant is a non-core asset and SacOil has in the past announced its intention to divest this asset. Revenue
generated by the Plant continued to deteriorate due to employment and maintenance issues, the extensive need for
capital investment and the subsequent loss of a major customer as a result of product related concerns. On 15 October
2012 the Company finalised a sale agreement with management and employees of the Plant, under which the Plant
was sold on an "as is" and vendor financed basis, with the liabilities for rehabilitation and environmental aspects passed
on to the purchaser. The sale of the Plant will eliminate the Company's monthly opex contribution to the Plant of
R0.2 million per month, ensure the continued employment of employees and enable SacOil management to focus on
the core oil and gas business. The purchaser has the obligation to provide a minimum of R2.0 million working capital
upfront; invest R5.0 million in capex for the recapitalisation and sustaining of the Plant; and make a staged payment
of R7.0 million to SacOil. The effective date for the transaction was 17 September 2012 and the sale was finalised on
15 October 2012. Details relating to the disposal of the Plant are included in notes 12 and 18.3 to the condensed Group
interim financial statements.

Financial review
Continuing operations
A loss from continuing operations of R13.7 million was reported compared to R100.4 million in
the prior comparable period. This principally reflected the recognition of profit on disposal of the
6.66% interest in Block III, increases in interest income and foreign exchange gains offset by debt
facility/capital raising fees, corporate and general costs and an impairment provision on the Greenhills
Plant.

Other income totalled R55.2 million (2011: R139.0 million). On 12 March 2012, Total acquired from Semliki,
a special purpose vehicle jointly owned by SacOil and DIG, a further 6.66% effective interest in Block III for a
cash consideration of US$10 million and future contingent bonuses receivable amounting to US$11.3 million. This
followed the prior year disposal to Total of a 60% interest in Block III. Of the R40.9 million profit (2011: R83.4 million loss)
on the sale of exploration and evaluation assets recorded in the current period, R45.0 million related to the disposal of
the 6.66% interest in Block III and was offset by a R4.1 million reversal of contingent bonuses receivable related to the
prior period disposal. Contingent consideration attached to the same transactions netted out at a R31.6 million charge
(2011: R219.1 million gain) with a R26.8 million gain on the current period disposal more than offset by a R58.4 million
reversal related to prior year provisions. SacOil's underlying 12.5% interest in Block III was retained through increasing
its interest in Semliki to 68%. The impact of the transaction was then adjusted for through "Non-controlling interest".

Foreign exchange gains of R38.9 million (2011: R3.3 million) principally related to the US$ denominated loans to
EER and the cash collateral held by Ecobank as security for the performance bond on OPL 233. The posting of the
performance bond required a cash collateral of US$10 million which was funded by lending facilities from Renaissance
BJM Securities (Proprietary) Limited ("Rencap") and Yorkville Advisors LLP ("Yorkville Advisors"). It was agreed between
EER and SacOil that SacOil would fund all costs relating to the performance bond with subsequent recovery of half
of these costs, being EER's portion, from EER based on a contractual agreement stipulating applicable interest and
repayment dates.

Other operating costs totalled R23.2 million (2011: R37.7 million) and principally comprised ongoing employment
costs, professional, legal and audit fees and the costs of maintaining the Company's listings on the Johannesburg and
London Stock Exchanges. The level of such expenses has decreased due to the non-recurrence of once-off AIM initial
listing costs incurred in the prior period amounting to R21.9 million. Operating costs in the current period were tightly
controlled to limit constraints on working capital requirements.

An impairment loss of R1.5 million was recognised, immediately before the classification of the Greenhills Plant as an
"Asset held for sale", to reduce the carrying amount of the assets in the disposal group to the fair value less costs to sell.
No share-based payment expenses were incurred in the current period (2011: R50.9 million).

Investment income of R27.2 million (2011: R6.7 million) principally comprised interest of R18.9 million (2011: R5.8 million)
on loans made to EER which increased following the posting of the performance bond. In addition, R7.9 million of
imputed interest (2011: R0.6 million) reflected the unwinding of the discount applied to the deferred consideration
related to the Block III disposals totalling R15.2 million partially offset by a R7.3 million impact of reversing some prior
year provisions.

The increase in finance costs by R19.6 million to R21.6 million related to interest costs and debt facility/capital raising
fees on the Rencap and Yorkville Advisors borrowing facilities.

Current tax represents R26.8 million (2011: R41.0 million) of capital gains tax on the profit on disposal of the additional
6.66% interest in Block III, R4.9 million (2011: R10.2 million) of foreign dividend tax and R18.4 million (2011: nil)
estimated penalties on the late payment of prior period tax charges. Deferred tax includes R10.7 million of provisions
(2011: R6.1 million) related to the current period disposal of the interest in Block III net of R12.8 million of releases
(2011: R88.0 million charges) related to the reversal of prior period provisions. A further R3.3 million (2011: nil) has been
provided against the expected recovery of costs carried by Total out of future production.

Discontinued operations
The loss of R1.4 million (2011: profit of R2.0 million) from discontinued operations related to the Greenhills Plant.
Declining revenues of R9.1 million (2011: R19.3 million) reflected the loss of a major customer and other factors
described above whilst cost of sales of R7.3 million (2011: R13.6 million), salaries of R2.4 million (2011: R3.0 million)
and other operating costs of R0.8 million (2011: R0.7 million) did not decline in proportion.

Financial position
Non-current assets showed an overall decrease to R472.9 million from R519.6 million at 29 February 2012.
The reduction in property, plant and equipment from R6.1 million at 29 February 2012 to R0.4 million at 31 August
2012 principally reflected the transfer of the Greenhills Plant to assets held for sale after depreciation. The reduction
in exploration and evaluation assets from R182.0 million to R135.7 million reflected the disposal of a 6.66% interest in
Block III and the revision of capitalised costs following the availability of additional cost information, partially offset by the
provision for costs incurred on Block III exploration by Total on the Company's behalf.

The increase in other financial assets from R331.4 million to R336.8 million included a R10.7 million net increase in
long-term loans. Future contingent bonuses receivable amounting to R26.8 million were recognised in the current
period following the disposal by Semliki of the 6.66% interest in Block III, together with imputed interest and foreign
exchange gains amounting to R50.3 million attributable to all contingent bonuses receivable from Total. However, future
contingent bonuses receivable attributable to the first farm-out which occurred in March 2011 were re-estimated in the
current period from US$108 million to US$90.5 million. This resulted in the reversal of contingent bonuses receivable
of R82.4 million.

Current assets showed a significant increase to R290.9 million from R98.5 million at 29 February 2012 largely
due to increases within trade receivables of loans to EER of R93.7 million, to DIG of R22.5 million and of the cash
collateral related to the performance bond of R84.6 million within cash and cash equivalents. The advance against
asset negotiation rights of R75.5 million remains in place although the Board recognises that there is a chance that
negotiations may be unsuccessful (see note 10).

Cash balances of R95.1 million showed an increase of R84.3 million during the period. This primarily reflects the
US$10 million cash collateral deposited with Ecobank as security for the Performance Bond on OPL 233.

Shareholders' equity attributable to equity holders of the parent increased from R333.1 million during the previous period
to R381.9 million. Increases in issued share capital from R486.2 million to R523.0 million arose from the conversion
of loans due to Yorkville Advisors into shares under the Standby Equity Distribution Agreement whilst a reduction in
accumulated losses largely reflected the profit within Semliki arising from the disposal of 6.66% of Block III.
Following the disposal of the Greenhills Plant in October 2012, management now plans to concentrate its activities in
the oil and gas exploration and production sector. Consequently it is intended to review the Group's accounting policies
and the presentation of its results to ensure that they fully reflect relevant recognised practice in this industry whilst still
remaining in compliance with IFRS. Any changes arising from this review will be reflected in the results for the full year
to 28 February 2013.

Financing the Group's activities
Total cash generated during the interim period was R84.3 million (2011: R6.1 million cash utilisation) resulting in a balance
of R95.1 million as at 31 August 2012. Net cash used in operating activities of R115.5 million (2011: R65.6 million) was
largely funded through the net impact of the sale of the 6.66% interest in Block III after adjustment for SacOil's increased
holding in Semliki, with increased borrowings further contributing to cash resources.

Cash utilised in operations of R115.8 million (2011: R31.4 million) is reflective of costs associated with the procurement
of the Performance Bond and advances to our partners. The decline in revenues and the increase in operating losses
from the Greenhills Plant also contributed to the decrease in operating cash flows.

The repayment of short-term loans by our partners is expected to improve cash flows from operations.

Prior period error
During the period ended 31 August 2011, whilst the Group correctly recognised the impact of the cash proceeds,
together with a receivable associated with the contingent bonuses receivable from Total on the farm-out of the 60%
interest of Block III, the value of the receivable, as well as the tax and interest impact of these amounts were not correctly
recognised. The previously reported comprehensive loss attributable to SacOil of R31.1 million has been correctly
adjusted and restated to a comprehensive loss of R100.1 million to correct these misstatements as at 31 August 2011.

Details of these adjustments are included in note 16 to the condensed Group interim financial statements.

Principal risks to 2012  2013 performance
The Directors do not consider that the principal risks as published in the Annual Report for the year ended 29 February
2012, on pages 14 and 15, have changed as at the date of this interim report. A detailed analysis of these risks can be
obtained in the Annual Report for the year ended 29 February 2012.

Going concern
The Group continues to rely on its ability to successfully raise further financing to fund future working capital and
development needs. The Board is satisfied that the Group has access to adequate resources to continue operating
for the next 12 months. The condensed Group interim financial statements have therefore been prepared on a going
concern basis.

By order of the Board	                                                                     Robin Vela (Chief Executive)

Johannesburg	                                                                                         21 November 2012

Consolidated statement of comprehensive income
Six months ended 31 August 2012
                                                                                       Restated*
                                                                         Reviewed     Unreviewed           Audited
                                                                       Six months     Six months         12 months
                                                                     to 31 August   to 31 August    to 29 February
                                                                             2012           2011              2012
                                                            Notes               R              R                 R
Continuing operations
Other income                                                    2      55 213 642    138 998 198       248 612 642
Other operating costs                                           3    (23 198 827)   (37 697 722)     (161 018 684)
Profit from operations                                                 32 014 815    101 300 476        87 593 958
Share-based payment expense                                                        (50 885 441)       (8 891 216)
Operating profit                                                       32 014 815     50 415 035        78 702 742
Investment income                                               4      27 203 337      6 729 254        29 455 933
Finance costs                                                   5    (21 517 167)    (2 031 756)      (44 402 672)
Profit before taxation                                                 37 700 985     55 112 533        63 756 003
Taxation                                                        6    (51 392 969)  (155 542 685)     (155 308 763)
Loss for the period from continuing
operations                                                           (13 691 984)  (100 430 152)      (91 552 760)
Discontinued operations
(Loss)/Profit for the period from discontinued
operations                                                     12     (1 414 628)      2 027 777         1 819 128
Loss for the period                                                  (15 106 612)   (98 402 375)      (89 733 632)
Other comprehensive loss:
Release of depreciation on property revaluation                                                        (340 000)
Taxation related to components of other
comprehensive income                                                                                     95 200
Other comprehensive loss for the period
net of taxation                                                                                        (244 800)
Total comprehensive loss                                             (15 106 612)   (98 402 375)      (89 978 432)
(Loss)/Profit attributable to:
Owners of the parent                                                 (12 647 013)  (100 121 875)      (95 506 424)
Non-controlling interest                                              (2 459 599)      1 719 500         5 772 792
                                                                     (15 106 612)   (98 402 375)      (89 733 632)
Total comprehensive (loss)/profit
attributable to:
Owners of the parent                                                 (12 647 013)  (100 121 875)      (95 751 224)
Non-controlling interest                                              (2 459 599)      1 719 500         5 772 792
                                                                     (15 106 612)   (98 402 375)      (89 978 432)
Loss per share from all operations
Basic loss per share (cents)                                    7          (1.64)        (14.71)           (13.35)
Diluted loss per share (cents)                                  7          (1.64)        (14.46)           (13.24)
Loss per share from continuing operations
Loss per share from continuing operations
(cents)                                                         7          (1.46)        (15.01)           (13.57)
Diluted loss per share from continuing
operations (cents)                                              7          (1.45)        (14.75)           (13.49)
*Refer to note 16 for details relating to the restatement.

Consolidated statement of financial position
Six months ended 31 August 2012
                                                                                          Restated*
                                                                        Reviewed         Unreviewed         Audited
                                                                      Six months         Six months       12 months
                                                                    to 31 August       to 31 August  to 29 February
                                                                            2012               2011            2012
                                                            Notes              R                  R               R
ASSETS
Non-current assets
Property, plant and equipment                                            394 269          6 281 592       6 148 362
Exploration and evaluation assets                               8    135 721 284        153 056 333     181 995 823
Other financial assets                                          9    336 829 120        288 003 480     331 430 863
Total non-current assets                                             472 944 673        447 341 405     519 575 048
Current assets
Inventories                                                                             2 401 083        2 540 131
Trade and other receivables                                    10    195 776 905        132 855 709      85 219 044
Cash and cash equivalents                                      11     95 118 280         11 786 472      10 774 298
Total current assets                                                 290 895 185        147 043 264      98 533 473
Assets held for sale                                           12      9 138 453                                 
Total assets                                                         772 978 311        594 384 669     618 108 521
EQUITY AND LIABILITIES
Shareholders' equity
Share capital                                                  13    522 956 123        468 379 828     486 184 423
Reserves                                                              29 743 531         38 879 547      29 743 531
Accumulated loss                                                   (170 768 333)      (196 321 260)   (182 814 593)
Equity attributable to equity holders of the parent                  381 931 321        310 938 115     333 113 361
Non-controlling interest                                              39 431 271        163 479 174     115 731 732
Total shareholders' equity                                           421 362 592        474 417 289     448 845 093
LIABILITIES
Non-current liabilities
Long-term borrowings                                                  20 638 362                        28 939 490
Deferred tax liability                                                94 911 472         94 054 385      93 728 263
Provisions                                                                               1 006 385       1 065 974
Total non-current liabilities                                        115 549 834         95 060 770     123 733 727
Current liabilities
Other financial liabilities                                    14    148 382 915                        12 496 195
Current taxation payable                                              70 852 538         20 495 100      20 495 100
Trade and other payables                                              12 688 483          4 411 510      12 538 406
Total current liabilities                                            231 923 936         24 906 610      45 529 701
Liabilities associated with assets classified
as held for sale                                               12      4 141 949                                 
Total liabilities                                                    351 615 719        119 967 380     169 263 428
Total equity and liabilities                                         772 978 311        594 384 669     618 108 521
*Refer to note 16 for details relating to the restatement.

Consolidated statement of cash flows
Six months ended 31 August 2012
                                                                                          Restated*
                                                                        Reviewed         Unreviewed         Audited
                                                                      Six months         Six months    12 months to
                                                                    to 31 August       to 31 August     29 February
                                                                            2012               2011            2012
                                                                               R                  R               R
Cash flows from operating activities
Cash used in operations                                            (115 816 936)       (31 360 793)   (133 918 365)
Investment income/(costs)                                                354 795          4 693 553     (1 447 623)
Finance costs                                                                            2 031 756    (44 402 672)
Taxation paid                                                                         (40 990 200)    (40 990 200)
Net cash used in operating activities                              (115 462 141)       (65 625 684)   (220 758 860)
Cash flows from investing activities
Purchase of property, plant and equipment                                                (135 909)       (504 209)
Purchase of exploration and evaluation assets                                            (508 907)       (508 907)
(Increase)/Decrease in other financial assets                                        (116 223 530)      19 493 215
Sale of exploration and evaluation assets                             75 997 000        143 465 700     143 465 700
Net cash from investing activities                                    75 997 000         26 597 354     161 945 799
Cash flows from financing activities
Proceeds on share issue                                                                 75 000 000      80 000 000
Increase in other financial liabilities                              148 382 917                        23 580 182
Finance lease payments                                                                    (90 508)        (90 508)
Dividends paid to non-controlling interest                          (24 573 794)                      (51 801 149)
Equity-settled expenses                                                               (41 994 225)               
Net cash from financing activities                                   123 809 123         32 915 267      51 688 525
Total cash movement for the period                                    84 343 982        (6 113 063)     (7 124 536)
Cash at the beginning of the period                                   10 774 298         17 899 535      17 898 834
Total cash at the end of the period                                   95 118 280         11 786 472      10 774 298
*Refer to note 16 for details relating to the restatement.

Consolidated statement of changes in equity
Six months ended 31 August 2012
                                                                                                                                             Total equity
                                                                                            Share-based                       Restated*   attributable to           Non-            Total
                                                                   Share    Revaluation         payment          Total      Accumulated    equity holders    controlling     shareholders
                                                                 capital        reserve         reserve       reserves             loss     of the parent       interest           equity
                                                                       R              R               R              R                R                 R              R                R
Balance at 1 March 2011                                      374 029 488      2 055 747      27 932 584     29 988 331     (96 199 385)       307 818 434    161 759 674      469 578 108
Changes in equity
(Loss)/Profit for the period                                                                                          (100 121 875)     (100 121 875)      1 719 500     (98 402 375)
Total comprehensive (loss)/income for the period                                                                       (100 121 875)     (100 121 875)      1 719 500     (98 402 375)
Issue of shares                                               94 350 340                                                                   94 350 340                     94 350 340
Share options issued                                                                        8 891 216      8 891 216                         8 891 216                      8 891 216
Total changes                                                 94 350 340                     8 891 216      8 891 216    (100 121 875)         3 119 681      1 719 500        4 839 181
Balance at 1 September 2011                                  468 379 828      2 055 747      36 823 800     38 879 547    (196 321 260)       310 938 115    163 479 174      474 417 289
Changes in equity
Profit for the period                                                                                                     4 615 451         4 615 451      4 053 707        8 669 158
Other comprehensive loss for the period                                      (244 800)                     (244 800)                         (244 800)                      (244 800)
Total comprehensive (loss)/income for the period                             (244 300)                     (244 800)        4 615 451         4 370 651      4 053 707        8 424 358
Issue of shares                                               17 804 595                                                                   17 804 595                     17 804 595
Share options lapsed                                                                      (8 891 216)    (8 891 216)        8 891 216                                               
Dividends paid to non-controlling interest                                                                                                            (51 801 149)     (51 801 149)
Total changes                                                 17 804 595      (244 800)     (8 891 216)    (9 136 016)       13 506 667        22 175 246   (47 747 442)     (25 572 196)
Balance at 29 February 2012                                  486 184 423      1 810 947      27 932 584     29 743 531    (182 814 593)       333 113 361    115 731 732      448 845 093
Changes in equity
Loss for the period                                                                                                    (12 647 013)      (12 647 013)    (2 459 599)     (15 106 612)
Total comprehensive loss for the period                                                                                (12 647 013)      (12 647 013)    (2 459 599)     (15 106 612)
Issue of shares                                               36 771 700                                                                   36 771 700                     36 771 700
Dividends paid to non-controlling interest                                                                                                            (24 573 794)     (24 573 794)
Acquisition of additional interest in subsidiary                                                                         24 693 273        24 693 273   (49 267 068)     (24 573 795)
Total changes                                                 36 771 700                                                  12 046 260        48 817 960   (76 300 461)     (27 482 501)
Balance at 31 August 2012                                    522 956 123      1 810 947      27 932 584     29 743 531    (170 768 333)       381 931 321     39 431 271      421 362 592
*Refer to note 16 for details relating to the restatement.

Notes to the condensed Group interim financial statements
Six months ended 31 August 2012

1.  Basis of preparation and presentation of financial information
    The consolidated condensed interim financial statements, comprised of SacOil Holdings Limited and its
    subsidiaries (together "the Group"), for the six months ended 31 August 2012, have been prepared in accordance
    with the recognition and measurement criteria of International Financial Reporting Standards ("IFRS") as issued
    by the International Accounting Standards Board (IASB), the preparation and disclosure requirements of IAS 34 
    Interim Financial Reporting, the AC500 Standards as issued by the Accounting Practices Board or its successor,
    the Listings Requirements of the JSE Limited and in the manner required by the South African Companies
    Act, No 71 2008. Accordingly, certain information and footnote disclosures normally included in annual financial
    statements prepared in accordance with International Financial Reporting Standards ("IFRS"), as issued by the
    IASB, have been omitted or condensed as is normal practice.

    Principal accounting policies
    The same accounting policies, presentation and methods of computation have been followed in these condensed
    Group interim financial statements as those applied in the preparation of the Group's annual financial statements
    for the year ended 29 February 2012. These condensed interim financial statements should be read in conjunction
    with the Group's consolidated financial statements for the year ended 29 February 2012.

    Review report
    The interim results for the six months ended 31 August 2012 have been reviewed by Ernst & Young Inc. A copy
    of the auditors' unqualified review opinion is available for inspection at the registered office of the Company. The
    unqualified review report includes an "Other regulatory matters" paragraph with respect to a reportable irregularity
    reported to the Independent Regulatory Board for Auditors in terms of section 45 of the Auditing Profession Act.

    The background is described in note 16.

    These condensed Group interim financial statements have been prepared under the supervision of CEO Robin
    Vela (Chartered Accountant).

    Notes to oil and gas disclosure
    In accordance with AIM Guidelines, Bradley Cerff, is the qualified person that has reviewed the technical
    information contained in this news release. Bradley has over 16 years experience in the oil and gas industry with
    a Masters degree in Science and Business Administration focused on Foreign Direct Investment in the African oil
    and gas industry. He is also a member of the Society of Petroleum Engineers.

2. Other income
                                                                                                           Restated
                                                                                  Six months to       Six months to
                                                                                      31 August           31 August
                                                                                           2012                2011
                                                                                              R                   R
   Profit/(Loss) on sale of exploration and evaluation assets                        40 926 877        (83 446 480)
   (Losses)/Gains on remeasurement of financial assets                             (31 621 739)         219 138 297
   Foreign exchange gains                                                            38 945 883           3 306 381
   Consulting fee                                                                     6 962 621                   
                                                                                     55 213 642         138 998 198

   The sale of exploration and evaluation assets comprised the sale by Semliki of a 60% interest in Block III in the
   prior period and a further 6.66% interest in the current period.

   Foreign currency gains arose primarily on US$-based loans to EER and the US$10million cash collateral held by
   Ecobank as security for the Performance Bond on OPL 233.

3. Other operating costs
   Impairment of property, plant and equipment (note 12)                             (1 456 572)                  
   Corporate costs                                                                   (3 012 342)        (5 012 243)
   Employment costs (including directors remuneration)                               (6 251 827)       (24 612 348)
   Auditors remuneration                                                             (2 315 189)          (250 000)
   Accounting fees                                                                     (388 375)           (25 600)
   Consultancy fees                                                                  (2 109 224)        (2 795 293)
   Legal fees                                                                        (2 373 166)        (2 137 514)
   Travel and accommodation                                                          (1 793 602)          (956 961)
   Depreciation                                                                        (373 271)          (498 583)
   Rentals                                                                             (492 313)          (210 681)
   Marketing                                                                           (486 125)          (823 555)
   Broker fees                                                                         (838 488)           (33 746)
   Other                                                                             (1 308 333)          (341 198)
                                                                                    (23 198 827)       (37 697 722)

4. Investment income
   Interest receivable  loans                                                       18 904 637          5 823 144
   Interest received  cash and cash equivalents                                        354 795            300 077
   Imputed interest on financial assets                                               7 943 905            606 033
                                                                                     27 203 337          6 729 254

5. Finance costs
   Debt facility/capital raising fees                                               (18 484 575)                 
   Interest paid to financial institutions                                           (3 032 592)       (2 031 756)
                                                                                    (21 517 167)       (2 031 756)

6. Taxation
   Current tax:
    Capital gains tax                                                              (26 849 411)      (40 990 200)
    Foreign income tax                                                              (4 914 759)      (10 247 550)
    Foreign estimated penalties                                                    (18 445 590)      (10 247 550)
                                                                                    (50 209 760)      (61 485 300)
   Deferred tax:
    Arising from the sale of exploration and evaluation assets                       2 137 244       (94 057 385)
    Arising from the recognition of the Total cost carry in Semliki                 (3 320 453)                 
                                                                                     (1 183 209)      (94 057 385)
   Taxation for the period                                                          (51 392 969)     (155 542 685)

7. Loss per share
   Basic and diluted loss per share
   Basic loss per share (cents)                                                           (1.64)           (14.71)
   Diluted loss per share (cents)                                                         (1.64)           (14.46)
   Basic and diluted loss per share from continuing operations
   Basic loss per share (cents)                                                           (1.46)           (15.01)
   Diluted loss per share (cents)                                                         (1.45)           (14.75)
   Loss used to calculate basic and diluted loss per share from continuing
   operations                                                                       (11 232 385)     (102 149 652)
   (Loss)/Profit from discontinued operations                                        (1 414 628)         2 027 777
   Loss used to calculate basic and diluted loss per share from
   all operations                                                                   (12 647 013)     (100 121 875)
   Weighted average number of ordinary shares used in the calculation
   of basic loss per share                                                          771 061 757        680 555 152
   Effect of dilutive potential ordinary shares                                       1 350 251         12 059 214
   Weighted average number of ordinary shares used in the calculation
   of diluted loss per share                                                        772 412 008        692 614 366
   Headline loss per share
   Headline loss per share (cents)                                                        (2.63)            (5.12)
   Diluted headline loss per share (cents)                                                (2.62)            (5.03)
   Headline loss reconciliation:
   Loss for the period from all operations                                          (12 647 013)    (100 121 875)
   Adjusted for:
   Impairment of property, plant and equipment                                        1 456 572                 
   (Profit)/loss on sale of exploration and evaluation assets attributable to
   equity holders of the parent                                                      (9 060 997)       65 254 812
   Headline loss                                                                    (20 251 438)     (34 867 063)

8. Exploration and evaluation assets
                                     At 29                                                                 At 31
                             February 2012          Additions       Adjustments         Disposals    August 2012
   Block III DRC               130 321 123          5 380 820       (13 908 618)     (31 025 595)     90 767 730
   OPL281 Nigeria               47 712 172                          (3 639 250)                     44 072 922
   OPL233 Nigeria                3 962 528                          (3 081 896)                        880 632
                               181 995 823          5 380 820       (20 629 764)     (31 025 595)    135 721 284

The farm-in agreement between Semliki and Total provides for a carry of costs, payable by Total, on behalf of
Semliki. Under the terms of this contract, Total shall be entitled to recover the accrued aggregate of the carried
costs from Semliki's share of future profits. This arrangement has been considered a secured borrowing in which
the underlying asset is used as collateral. Semliki has therefore increased the Block III exploration and evaluation
asset with the carried costs as incurred by Total up to the reporting date by an amount of R5.4 million, together
with a corresponding financial liability representing the amount owed to Total. A corresponding deferred tax asset
in an amount of R2.2 million was recognised in profit and loss. The March 2012 disposal of the 6.66% interest in
Block III resulted in the derecognition of R31.0 million of exploration and evaluation assets.

As at 29 February 2012 the Total cost carry had been estimated at R28.9 million. Due to the availability of
additional information the cost carry was re-estimated to R15.0 million in the current period resulting in the
reversal of capitalised costs amounting to R13.9 million. In addition, costs associated with the OPL 233 and
OPL 281 assets were revised in the current period resulting in the reversal of capitalised costs amounting to
R8.1 million.

9. Other financial assets
                                                                                  31 August         29 February
                                                                                       2012                2012
                                                                                          R                   R
    Contingent consideration                                                    257 917 042         263 260 148
    Loan due from DIG                                                                                1 929 982
    Loan due from EER                                                            78 912 078          66 240 733
                                                                                336 829 120         331 430 863

    The EER loan in relation to the carrying of EER's farm in fees is secured by a corporate guarantee from EER.

10. Trade and other receivables
    Trade receivables                                                                51 033           3 646 478
    Loan due from EER                                                            93 728 716                   
    Loan due from DIG                                                            22 451 501                   
    Advance against asset negotiation rights                                     75 490 000          75 490 000
    Value-added tax                                                                 138 036           1 611 041
    Other receivables                                                             3 917 619           4 471 525
                                                                                195 776 905          85 219 044

EER is obliged to repay SacOil on or before 15 December 2012 its 50% share of interest and costs associated
with the cash collateral and the posting of the US$25 million performance bond. A receivable of R93.7 million
(February 2012: nil) is included in trade and other receivables in this regard. The EER loan in relation to the
performance bond is secured by a cession and pledge over EER's shares in EER 233 Nigeria which owns a 20%
interest in OPL233.

SacOil also entered into a tax indemnity agreement with DIG following the sale of the 6.66% interest in Block III,
whereby DIG is liable for all taxes arising from the disposal. The loan due from DIG represents capital gains tax
recoverable from DIG under the terms of this agreement.

An advance payment of R75.5 million (February 2012: R75.5 million) was made by SacOil in relation to an
agreement whereby SacOil would be granted an exclusive right to negotiate a potential acquisition of certain
material oil and gas concessions. Commercial negotiations have taken place with all material
stakeholders in relation to the potential transaction, however these have not, so far, resulted in the Company
securing any interest in the concessions or exclusive right to negotiate for such interests. While discussions 
with all relevant parties are ongoing, the Board recognises that these discussions may not lead to the Company 
acquiring interests in the target concessions. The Company is reviewing its options to seek recourse from third 
parties in respect of this advanced payment. The risk that SacOil may not be able to recover all or part of the 
advanced payment therefore remains.

11. Cash and cash equivalents
    Cash and cash equivalents consist of:
                                             31 August   29 February
                                                  2012         2012
                                                     R            R
   Bank balances                            10 278 565    3 137 098
   Short-term deposits                         203 628    7 637 200
                                            10 482 193   10 774 298
   Restricted cash                          84 636 087            
                                            95 118 280   10 774 298

Restricted cash comprises the cash collateral of US$10 million (August 2012: R84.6 million, February 2012: nil)
paid to Ecobank to secure the Performance Bond for OPL233. This cash is held in the bank account of SacOil's
wholly owned subsidiary, SacOil 233 Nigeria Limited. The remainder of the Performance Bond is secured by a
first ranking legal charge over SacOil's investment in SacOil 233 Nigeria Limited.

12. Assets held for sale
    Assets and liabilities in this category relate to the Greenhills Plant which has been successfully disposed of as at
    the date of this interim report:

                                                                                                      31 August 2012
    Greenhills Plant Assets
    Property, plant and equipment                                                                          3 924 246
    Inventories                                                                                            2 788 609
    Trade receivables                                                                                      2 425 598
                                                                                                           9 138 453
    Greenhills Plant Liabilities
    Trade creditors                                                                                        3 015 977
    Provision for decommissioning                                                                          1 125 972
                                                                                                           4 141 949
    Net assets held for sale                                                                               4 996 504

    (Loss)/Profit from discontinued operations:
                                                                  31 August           31 August          29 February
                                                                       2012                2011                 2012
    Revenue                                                       9 113 711          19 273 596           37 172 586
    Cost of sales                                               (7 328 296)        (13 572 065)         (26 569 161)
    Gross profit                                                  1 785 415           5 701 531           10 603 425
    Salaries and wages                                          (2 356 295)         (3 020 744)          (5 144 207)
    Other operating costs                                         (843 748)           (653 010)          (3 640 090)
    (Loss)/Profit from discontinued operations                  (1 414 628)           2 027 777            1 819 128
    Earnings per share:
    Basic (loss)/earnings per share from discontinued
    operations (cents)                                               (0.18)                0.30                 0.25
    Diluted (loss)/earnings per share from discontinued
    operations (cents)                                               (0.18)                0.29                 0.25

Immediately before the classification of the Greenhills Plant as an asset held for sale, an impairment loss of
R1.5 million was recognised to reduce the carrying amount of the assets in the disposal group to the fair value
less costs to sell. This was recognised in the statement of comprehensive income under other operating costs.

    
13. Stated capital
    SacOil issued the following ordinary shares during the period under review:

                                                                         Nature of        Number of             Stated
                                                        Issued to           issue            shares            capital
    Balance as at 1 March 2012                                                          832 225 699        486 184 423
    Friday, March 23, 2012                       Yorkville Advisors   Specific issue     29 328 257         12 628 000
    Friday, May 04, 2012                         Yorkville Advisors   Specific issue     32 135 560         15 815 400
    Monday, July 09, 2012                        Yorkville Advisors   Specific issue     24 578 863          8 328 300
    Balance as at 31 August 2012                                                        918 268 379        522 956 123

14. Other financial liabilities
                                                                                          31 August        29 February
                                                                                               2012               2012
                                                                                                  R                  R
    Renaissance BJM Securities (Proprietary) Limited ("Rencap")                          84 348 210                  
    Energy Equity Resources ("EER")                                                      42 166 500                  
    Yorkville Advisors LLP ("Yorkville")                                                 21 868 205         12 496 195
                                                                                        148 382 915         12 496 195

    The Rencap loan was raised to part fund the US$10 million cash collateral requirement for posting the
    Performance Bond on OPL 233. The Rencap loan is secured by SacOil's shares in its subsidiary RDK Mining
    which owns a 68% interest in Semliki Energy SPRL, the holder of an 18.34% interest in Block III. Refer to note
    18.4 for further details on the Rencap loan.

    The EER liability relates to EER's share of the US$10 million cash collateral held in the bank account of SacOil's
    wholly owned subsidiary, SacOil 233 Nigeria Limited as disclosed in notes 10 and 11. There are no repayment
    terms for this US$5 million as it will be utilised to fund the work programme on OPL 233.

    The Yorkville loan was raised to part fund the US$10 million cash collateral requirement for posting the
    Performance Bond on OPL 233. As disclosed in note 18.1, this loan was settled post period-end. The Yorkville
    loan is unsecured.

15. Operating segments
    The business segment represented by the manganese processing and sales from the Greenhills Plant has been
    reclassified as a discontinued operation following the agreement for its sale on 15 October 2012. Consequently
    the Group's only business segment as well as the primary reporting segment for the period under review is oil
    and gas exploration.

16. Prior period adjustments/Reportable irregularity

    16.1   Prior period adjustments
           Block III acquisition
           During the period ended 31 August 2011, whilst the Group correctly recognised the impact of the cash
           proceeds, together with a receivable associated with the contingent bonuses receivable from Total on the
           farm-out of 60% of the legal and beneficial participating interest of Block III, the value of the receivable,
           as well as the tax and interest impact of these amounts were not currently recognised. The withholding
           taxes and penalties on the dividend distribution were also not accounted for. The impact of this on the
           interim results is as follows:
                                                             As previously                                  Restated
                                                                  reported           Adjustments      31 August 2011
           Impact on the statement of
           comprehensive income:
           Increase in other income                            101 613 144            37 385 054         138 998 198
           Increase in investment income                         6 123 221               606 033           6 729 254
           Increase in taxation                                                   (155 542 685)       (155 542 685)
           Decrease in profit                                   19 149 224         (117 551 599)        (98 402 375)
           Decrease in headline earnings                        38 712 521          (73 579 584)        (34 867 063)
           Basic loss per share (cents)                             (4.57)                (8.64)             (14.71)
           Diluted loss per share (cents)                           (4.49)                (8.49)             (14.46)
           Headline profit/(loss) per share (cents)                   5.69               (10.81)              (5.12)
           Diluted headline profit/(loss) per share (cents)           5.59               (10.62)              (5.03)
           Impact on the statement of financial
           position:
           Decrease in other financial assets                  291 002 593           (2 999 113)         288 003 480
           Increase in deferred tax liability                                        94 054 385          94 054 385
           Increase in current taxation payable                                      20 495 100          20 495 100
           Decrease in equity                                  591 968 888         (117 551 599)         474 417 289

           The impact was correctly accounted for at 29 February 2012. As the adjustment relates to items initially
           recognised in the prior period, no third statement of financial position has been presented, nor is this
           required in terms of IAS 34 Interim Financial Reporting.

    16.2  Reportable irregularity
          During the current period the Directors discovered prior period errors (refer to note 16.1) which resulted
          in a prior period restatement relating to the 31 August 2011 interim results. The Group's auditors have
          reported this matter to the Independent Regulatory Board for Auditors as a reportable irregularity in terms
          of S45 of the Auditing Professions Act.

17. Dividends
    The Board has resolved not to declare any dividends to shareholders for the period under review, choosing to
    retain cash for working capital and project development requirements.

18. Events after the reporting period
    The following events took place from the period 1 September 2012 to the date of this interim report.

    18.1  Repayment of Yorkville Advisors loan
          As announced on 1 November 2012, SacOil settled the remaining indebtedness to Yorkville Advisors
          ("YA") by making a cash payment of US$1.0 million and issuing 35 072 412 new SacOil ordinary
          shares ("Shares") to YA at a price of R0.32 per Share (the "Issue"), raising R11.2 million (approximately
          US$1.2 million). The Issue is in line with the terms of a Standby Equity Distribution Agreement between
          YA and SacOil which was approved by SacOil shareholders in a general meeting on 17 November 2011.

    18.2  Partial loan repayment by EER
          On 22 October 2012, SacOil received US$3.0 million from EER as part repayment of the cash collateral
          contribution owed to SacOil by EER.

    18.3  Disposal of the Greenhills Plant
          The disposal of the plant was finalised on 15 October 2012 with an effective date of 17 September 2012.
          The plant was sold to management and employees of the plant on an "as is" and vendor financed basis,
          for R7 million payable as follows:
           1 October 2013                                                                                   R 1 000 000
           1 October 2014                                                                                   R 2 000 000
           1 October 2015                                                                                   R 2 000 000
           1 October 2016                                                                                   R 2 000 000
           Assets and liabilities attributable to the Plant are disclosed in note 12.

    18.4  Renaissance BJM Securities (Proprietary) Limited ("Rencap") loan
         The loan due to Rencap as disclosed in note 14 was due for repayment on 10 October 2012. The terms
         of the loan were renegotiated to facilitate an extension in repayment dates from 10 October 2012 to
         30 November 2012. In addition, Rencap were granted options to acquire up to 20 000 000 SacOil Shares
         at a price equivalent to a 10% discount on the 30-day volume weighted average price per SacOil Share
         at the time of exercise. Such options expire on 30 November 2012.

   18.5  Gairloch Limited ("Gairloch") loan
         On 10 September 2012 SacOil obtained an unsecured convertible loan of US$1 million from Gairloch
         to fulfil the Group's financing obligations relating to its assets. The term of the loan is 180 days at an
         interest rate of 8% per month. The loan will be repaid through cash or equity-settlement. If equity settled,
         the pricing of equity will be at the 30-day volume weighted average price of a SacOil Share at the time
         of conversion.

SacOil Holdings Limited
(Incorporated in the Republic of South Africa) (Registration number 1993/000460/06)
JSE share code: SCL      AIM share code: SAC ISIN: ZAE000127460
("SacOil" or "the Company" or "the Group")

Directors: Richard John Linnell** (Chairman), Robin Vela (Chief Executive Officer), John Bentley**
Colin Bird*, James William Guest**, Gontse Moseneke*
*Non-executive director     **Independent Non-executive directors

Corporate information

Registered office and physical address: 2nd Floor, The Gabba, Dimension Data Campus,
57 Sloane Street, Bryanston, 2021

Postal address: PostNet Suite 211, Private Bag X75, Bryanston, 2021

Contact details: Tel: +27 (0) 11 575 7232 Fax: +27 (0) 11 576 2258
Email: info@sacoilholdings.com     Website: www.sacoilholdings.com

Advisers
Company Secretary 	                   Fusion Corporate Secretarial Services (Proprietary) Limited
Transfer Secretaries South Africa	   Link Market Services South Africa (Proprietary) Limited
Transfer Secretaries United Kingdom        Computershare Investor Services (Jersey) Limited
Corporate Legal Advisers 	           Norton Rose South Africa
Auditors	                           Ernst & Young Inc
JSE Sponsor	                           Nedbank Capital
AIM Nominated Adviser	                   finnCap Limited

www.sacoilholdings.com
Date: 21/11/2012 05:00:00 Supplied by www.sharenet.co.za                     
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