Oracle Power : Financial Report for the year ended 31 December 2023

Registered number: 05867160

ORACLE POWER PLC

ANNUAL REPORT AND FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2023

ORACLE POWER PLC

COMPANY INFORMATION

FOR THE YEAR ENDED 31 DECEMBER 2023

Oracle Power PLC is registered as a public company under English Law. Its shares are quoted on the AIM market of the London Stock Exchange. Oracle Power PLC is incorporated and domiciled in England and Wales with registered number 05867160.

DIRECTORS	Mr M W Steed - Chairman
	Ms N Memon - CEO
	Mr D Hutchins
SECRETARY	Mr N Lee
REGISTERED OFFICE	Tennyson House
	Cambridge Business Park
	Cambridge CB4 0WZ
REGISTERED NUMBER	05867160 (England and Wales)
AUDITORS	Price Bailey LLP	A. F. Ferguson & Co
	Tennyson House	Chartered Accountants
	Cambridge Business Park	State Life Building 1-C
	Cambridge CB4 0WZ	I. I. Chundrigar Road
		Karachi Pakistan
	Pitcher Partners
	Level 11/12-14 The Esplanade
	Perth WA 6000, Australia
NOMINATED ADVISER AND JOINT
BROKER	Strand Hanson Limited
	26 Mount Row
	London W1K 3SQ
JOINT BROKER	Global Investment Strategy UK Limited
	200 Aldersgate Street
	London EC1A 4HD
REGISTRAR	Neville Registrars Limited
	18 Laurel Lane, Halesowen
	West Midlands B63 3DA
SOLICITORS	Charles Russell Speechlys LLP	Makhdoom & Co
	5 Fleet Street	2nd Floor Imperial Building
	London EC4M 7RD	Mt Khan Road, Karachi, Pakistan
BANKERS	Royal Bank of Scotland plc	Habib Bank AG Zurich
	1st Floor, Conqueror House	Moorgate Branch,
	Vision Park, Histon	Habib House,
	Cambridge CB24 9NL	42 Moorgate,
		London EC2R 6JJ
	Habib Metropolitan Bank
	Habib Bank Plaza,
	I.I.Chundrigar Road,
	Karachi-75650, Pakistan
PUBLIC RELATIONS	St Brides Partners Limited
	Claydon Barns
	11 Towcester Road
	Whittlebury, Northants NN12 8XU
	London EC2V 6DN

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ORACLE POWER PLC

CONTENTS

Chairman's Statement		3
Chief Executive's Report	4 - 5
Group Strategic Report	6 - 15
Directors' Report	16	- 19
Remuneration Report	20	- 21
Governance Report	22	- 25
Directors' Responsibilities Statement		26
Independent Auditors' Report	27 - 32
Consolidated Statement of Profit or Loss		33
Consolidated Statement of Other Comprehensive Income		34
Consolidated Statement of Financial Position		35
Company Statement of Financial Position		36
Consolidated Statement of Changes in Equity	37	- 38
Company Statement of Changes in Equity	39	- 40
Consolidated Statement of Cash Flows	41	- 42
Company Statement of Cash Flows	43	- 44
Notes to the Consolidated Financial Statements	45 - 80

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ORACLE POWER PLC

CHAIRMAN'S REPORT

FOR THE YEAR ENDED 31 DECEMBER 2023

I am pleased to present the annual report and financial statements for Oracle Power PLC ("Oracle" or the "Company") for the year ended 31 December 2023.

The coal and power generation project in Thar, Pakistan

The development of the proposed mine and power project at Block VI in the Thar desert has continued to progress, albeit slowly, as it is a CPEC project and hence is impacted by Chinese government policy. The Government of Pakistan has already established demand for 1,320 MW of Thar coal-based power in 2027, thereby facilitating the potential development of this project. We have a number of non-binding offtake memorandums of understanding in place for the planned coal generated power and another agreement with PowerChina to develop, in parallel, a proposed 1 GW solar farm also at Thar.

The Green Hydrogen project in Thatta, Pakistan

During the year under review, most of our attention was focused on our Green Hydrogen project, which comprises the planned construction of a 400MW plant producing 55,000 tonnes of green hydrogen per annum backed by 1,300MW of hybrid solar/wind, green hydrogen power plants.

This project is being developed through Oracle Energy Limited ("Oracle Energy"), a private company owned 70% by His Highness Sheikh Ahmed Dalmook Al Maktoum through his wholly owned company Kaheel Energy FZE ("Kaheel Energy"), and 30% by Oracle. Oracle is primarily responsible for managing the project whilst Kaheel Energy will seek to leverage its strategic position and influence to enhance market access and secure potential financing. In terms of a summary of project milestones we have achieved to date:

• 30-yearlease on 7,000 acres required for the renewable energy - wind and solar operations;
• Letter of Intent ("LOI") in place for the establishment of the renewable energy "farm" and have a US$600,000 performance guarantee bond in place;
• LOI from TUV SUD for the certification of the hydrogen output;
• Thyssenkrupp Uhde has completed the requisite Green Hydrogen and Green Ammonia feasibility study;
• Fugro Pakistan has completed the topography survey study;
• State Grid of China has completed the Renewable Power feasibility study; and
• SGS has completed the ESIA study post the period end.

The Western Australian exploration projects

Our gold prospect in Western Australia, the Northern Zone, is progressing well as part of our farm-in arrangement with Riversgold Ltd ("Riversgold"). Once the final stage of the drill programme and testing by Riversgold has been completed, we will be able to retain a minority interest in the project for the potential next phase of its development. In addition, post the year end, the Company acquired a copper/silver exploration project for all share consideration in the same region of Australia.

A more comprehensive overview of our Operational highlights for 2023 is set out in the Chief Executive's Report.

We are most grateful to the Pakistani authorities for their continued support and to the WA mining authorities for facilitating exploration and development activities in their region.

Above all, I wish to take this opportunity to thank our shareholders for their continued confidence, patience and support, enabling us to make steady progress on our project portfolio in a challenging macroeconomic environment.

Mark Steed

Chairman

25 June 2024

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ORACLE POWER PLC

CHIEF EXECUTIVE'S REPORT

FOR THE YEAR ENDED 31 DECEMBER 2023

I am pleased to present details of the Company's activities and progress for its financial year ended 31 December 2023.

2023 has been a year of notable progress for the Company in both Pakistan and Australia. During the year, we successfully completed a number of key assessments for the proposed development of the Company's significant Green Hydrogen project (the "GH Project") in Pakistan. We also forged important relationships in Western Australia for the further exploration of our tenements situated there and entered into strategic understandings for the development of both our Renewable Power Project and GH Project in Pakistan. I am pleased to report that we have made encouraging progress across our project portfolio and set out an overview below.

In Pakistan, we maintained an active dialogue with the Power Division, Ministry of Energy, in connection with the proposed development of the Company's planned 1,320MW, coal to power project under the China Pakistan Economic Corridor ("CPEC"). In September 2023, the Government of Pakistan published its annual Indicative Generation Capacity Expansion Plan (the "IGCEP"), a demand supply policy guidance chart for Pakistan and the demand for 1,320MW of local Thar coal fired power was forecast to be required in 2027. Such confirmation of demand should facilitate advancement of the project, subject to securing appropriate financing and offtake arrangements in due course. In Q2 2023, subsequent to the publication of the IGCEP, we initiated dialogue with potential offtakers other than the Government of Pakistan. We signed an important Memorandum of Understanding ("MOU") for the off-take and planned development of our 1,320MW Thar coal-fired power plant in the Sindh Province, Pakistan, with a consortium of parties including the Energy Department, Government of Sindh, K-Electric Limited ("KE"), the largest privately owned vertically integrated power utility in Pakistan, and PowerChina International Group Limited. Since the 1,320MW project falls within CPEC, we await the go ahead from the Chinese Government's financing department, and our strategic partner, Power China, which maintains a regular dialogue with the relevant authorities.

Furthermore, based on the introduction of the CTBCM (Competitive Trading Bilateral Contracts Market), all offtakers can bid to fulfil demand recorded in the IGCEP, if financing is available. KE, as a potential offtaker, could secure the entire 1,320MW output and issue Oracle with a direct power purchase agreement (PPA), with equity contributions potentially being made by any of the parties to the MOU.

In addition, the parties have agreed to assess the viability of developing the power project at Thar Coal Block VI or relocating it to KE's land at Port Qasim, Karachi. The power project is likely to require 7.6 million tonnes of Thar coal annually, which could be sourced from existing mines at Thar Block I and II or a new mine could be developed, if commercially viable.

In Western Australia, Oracle has continued to conduct further exploration work on its Northern Zone ("NZ") project, 25km from Kalgoorlie, following the promising results from the maiden drill programme in 2022 targeting felsic intrusives porphyry. The results established a low grade but potentially large mineralisation across the tenement. The Company carried out further metallurgical tests to confirm gold recovery rates, the results of which, released in June 2022, showed an excellent recovery rate of up to 94.7%.

In Q2 2023, the Company signed a farm-in agreement with ASX-listed Riversgold Ltd ("Riversgold"), marking a significant step in the further progression of our NZ project and serving to endorse our partnering strategy as project developers. Pursuant to this agreement, Riversgold has the right to earn up to an 80% beneficial interest in the NZ project by paying an upfront cash consideration of A$50,000 (received) and commiting to spend no less than A$600,000 on exploration over the next two years (which is ongoing).

Subsequently, the Company completed diamond drilling on the entire gold-mineralised central cross-section to a vertical depth of 450 metres, validating the previous exploration model. This drill programme confirmed a previously announced exploration target of 2.5Moz - 4.8Moz of gold. In addition, the work programme demonstrated a high gold recovery rate of 92.9% on average after a 24-hour bottle roll cyanide extraction. A reverse circulation and air core drilling campaign is currently ongoing to further prove up the resource potential of the asset and move towards establishing a maiden JORC Mineral Resource Estimate in 2024. Our partnership

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ORACLE POWER PLC

CHIEF EXECUTIVE'S REPORT (CONTINUED)

FOR THE YEAR ENDED 31 DECEMBER 2023

aims to advance the development of the NZ project at minimal cost to the Company, leveraging the expertise and resources of Riversgold to develop a potential future economically viable gold mine.

In 2023, the Company also accelerated the development of its Green Hydrogen project (the "GH Project") in the wind corridor in the Thatta district of Pakistan. This project was launched in Q4 2022, and the Company has achieved a number of significant milestones in 2023. In Q2 2023, the Company signed a non-binding Investment MOU with the State Grid Corporation of China to potentially develop and finance the proposed hybrid renewable power and GH Project. In June 2023, Oracle Energy signed a non-binding MOU with PetroChina International (Middle East) Company Limited ("PCME") for co-operation and the joint development of commercial avenues for the project. In particular, PCME has agreed to arrange the potential offtake of the output and carbon credits stemming from the project.

In July 2023, Oracle Energy completed the topography survey for the project's site, commissioned from Fugro Pakistan, part of a world-renowned global consultancy group. In Q3 2023, the Company also completed its technical and commercial feasibility study for the project, undertaken by Thyssenkrupp Uhde. The findings provided a very positive outlook, comparable to industry expectations observed in other global green hydrogen projects, and have potentially derisked the project from both a technical and commercial perspective.

In Q2 2023, Oracle Energy also commissioned a technical and commercial feasibility study for the hybrid renewable power plant for the project, undertaken by leading international construction and engineering company, China Electric Power Equipment and Technology, a wholly-owned subsidiary of the State Grid Corporation of China. Upon completion, this study is expected to affirm the commercial viability of the planned hybrid renewable facility. The study will analyse the project's resources, design the hybrid system, evaluate grid integration, ensure competitive energy prices and potentially attractive returns for investors, whilst providing a detailed integration roadmap into Pakistan's power grid.

Post the reporting period end, the Company commissioned an ESIA Study by SGS, a global integrated service provider and a geotechnical study and electrical resistivity survey by F&M, a leading engineering and testing service provider. These further studies will seek to optimise site planning and design, setting the stage for the FEED phase.

The Company's strategy is to progress and develop its various projects, thereby diversifying risk, and with a view to timely divestment when appropriate in order to maximising returns and shareholder value. In summary, the Company has progressed and continues to implement such strategy by identifying and forging relationships with partners, in order to provide potential financing and resources and expertise for the advancement of its projects and enhance the attractiveness of its portfolio.

I remain grateful to all the relevant authorities in Pakistan and Western Australia for their ongoing support for our various initiatives, as well as the dedication and hard work of our teams in the UK, Pakistan and Australia. I am also cognisant and most appreciative of the continued confidence, patience and support of our shareholders, to enable us to deliver on our plans. The Company remains committed to increasing shareholder value and to growing into an enterprise of greater size and scale over the longer term.

Ms Naheed Memon

Chief Executive Officer

25 June 2024

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ORACLE POWER PLC

GROUP STRATEGIC REPORT

FOR THE YEAR ENDED 31 DECEMBER 2023

INTRODUCTION

The Directors present their Strategic Report of the Company and the Group for the year ended 31 December 2023.

PRINCIPAL ACTIVITY AND BUSINESS MODEL

The principal activity of the Group during the year under review was that of a project development company. The Company is currently involved with four projects: an energy project, based on the potential development of a coal resource and construction of a mine-mouth power plant in Pakistan; two exploration projects for gold and copper/silver in Western Australia (WA); and the potential development of a green hydrogen project in Pakistan.

Our development work in Pakistan has primarily focused on acquiring land, commissioning various requisite studies and obtaining the necessary permissions from the government. Our work in WA has involved exploration of the tenements concerned and developing plans for further resource estimation. Although our projects are generally held and operated through SPVs, the Group itself is controlled, financed and administered within the United Kingdom, which remains the principal place of business. The Group's business model is to create value through the establishment of a balanced portfolio of potentially high return projects and advancing them through commercially attractive joint venture or similar partnering transactions to ultimate future production or sale.

BUSINESS REVIEW

During the year, the Group has used its budgeted funds to advance the Thar power project and green hydrogen project in Pakistan as well as its gold assets in Western Australia. Expenditures are either capitalised or expensed, in accordance with IFRS requirements. The capitalised expenditures are shown as intangible fixed assets in the Statement of Financial Position and the expensed expenditures are shown as administrative expenses in the Statement of Profit or Loss. The consolidated loss after taxation for the year to 31 December 2023 amounted to £789,795 (2022: £1,289,658).

The Chairman, in his Statement, and the Chief Executive Officer in her Report, have summarised the activities of the Group during the financial year under review.

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ORACLE POWER PLC

GROUP STRATEGIC REPORT (CONTINUED)

FOR THE YEAR ENDED 31 DECEMBER 2023

SECTION 172(1) STATEMENT

The directors are well aware of their duty under Section 172(1) of the Companies Act 2006 to act in the way which they consider, in good faith, would be most likely to promote the success of the Company for the benefit of its members as a whole, and in doing so have regard (amongst other matters) to:

• The likely consequences of any decision in the long term;
• The interests of the Company's employees;
• The need to foster the Company's business relationships with suppliers, customers and others;
• The impact of the Company's operations on the community and the environment;
• The desirability of the Company maintaining a reputation for high standards of business conduct, and
• The need to act fairly as between members of the Company (the "Section 172(1) Matters").

Induction materials provided on appointment include an explanation of directors' duties, and the board is regularly reminded of Section.172(1) Matters, including as a rolling agenda item at every main board meeting.

Further information on how the directors have had regard to the Section.172(1) Matters can be found on pages 8 to 16.

Section 172(1) Companies Act 2006

The board takes decisions with the long term in mind, and collectively and individually aims to uphold the highest standards of conduct. Similarly, the Board understands that the Company can only prosper over the long term if it understands and respects the views and needs of its customers, distributors, employees, suppliers and the wider community in which it operates.

A firm understanding of investor needs is also vital to the Company's success along with a sustainable and environmentally responsible culture. This is detailed on page 15. The directors are fully aware of their responsibilities to promote the success of the Company in accordance with Section 172(1) of the Companies Act 2006. The text of Section 172(1) of the Companies Act 2006 has been sent out to each main Board director.

The Board ensures that the requirements are met, and the interests of stakeholders are considered as referred to elsewhere in this report and through a combination of the following:

• A rolling agenda of matters to be considered by the Board throughout the year, which includes an annual strategy review meeting, where the strategic plan for the following year is developed;
• Standing agenda points and papers presented at each Board meeting, which report on customers, employees and other colleagues, health and safety matters and investors;
• A review of certain of these topics through the Audit Committee and the Remuneration Committee agenda items referred to in this report;
• Detailed consideration is given to any of these factors where they are relevant to any major decisions taken by the Board during the year;
• At this stage, the directors consider that there are no financial KPIs that are specifically relevant to assessing the business.

Key Board decisions taken during the year, all of which have long term implications for the ultimate success of the Company, and the Section 172(1) and stakeholder considerations are set out below:

• Development of the Company's northern zone gold project in Western Australia;
• Further development of the Company's coal and power projects in Pakistan; and
• Progression of the Company's green hydrogen project in Pakistan.

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ORACLE POWER PLC

GROUP STRATEGIC REPORT (CONTINUED)

FOR THE YEAR ENDED 31 DECEMBER 2023

Relations with Shareholders

The Company's principal means of communication with shareholders is through its Annual Report and Financial Statements, the full-year and half-year results announcements and the AGM. The Board recognises that the AGM is an important opportunity to meet private shareholders. Each substantially separate issue is the subject of a separate resolution at the AGM and all shareholders have the opportunity to put questions to the Board. All Board directors endeavour to attend AGMs and answer questions put to them which may be relevant to their responsibilities. In addition, the directors are available to listen informally to the views of shareholders immediately following the AGM. For each vote, the number of proxy votes received for, against and withheld is announced at the meeting. The results of the AGM are published on the Company's corporate website.

The Board receives regular updates on the views of shareholders through briefings and reports from the executive directors, the Company's brokers and PR advisers. The Chief Executive Officer makes presentations to institutional shareholders and participates in investor road shows both following the announcement of the full-year and half-year results and, at other times throughout the year as appropriate. Not every officer participates in every investor presentation. The Chairman will participate in such presentations where appropriate and is always available to speak with shareholders.

Dialogue with individual institutional shareholders also takes place to better understand their principles and investment objectives where practicable.

Investor queries may be addressed to the Company Secretary at [e-mail]. A range of corporate information (including all Company announcements) is also available to shareholders, investors and the public on the Company's corporate website at www.oraclepower.co.uk.

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ORACLE POWER PLC

GROUP STRATEGIC REPORT (CONTINUED)

FOR THE YEAR ENDED 31 DECEMBER 2023

PRINCIPAL RISKS AND UNCERTAINTIES

The Group is engaged in the development of four key projects which include:

• a coal resource in Block VI and associated power project in the Thar Desert in the Sindh province in Pakistan seeking to establish a power plant and coal to gas facility;
• a gold exploration asset in Western Australia;
• a copper/silver exploration asset in Western Australia (acquired post year end on 11 June 2024);
• and a wind power and green hydrogen production facility in Pakistan.

The principal strategic and operational risks and uncertainties facing the Group are described below, together with the steps taken for their mitigation. Information on financial risk management is set out in the Financial Instruments section in this report.

The principal risks and uncertainties for the Company's projects are:

Issue	Likelihood of Issue Arising	Impact if issue Arises
Financing	Medium	High
Project Completion	Medium	Medium
Operating	Low	Low/Medum
Economic	Low/Medium	Low
Political, Legal and Regulatory	Low	Medium
Environment & Corporate Social Responsibility	Low	Low

Following the acquisition of the gold project in Western Australia, the Company established resource estimates via exploratory work on both the tenements acquired. In Pakistan, the Company has continued its efforts to develop its coal to power plant given it has secured interest via memorandums of understanding with potential offtake and equity partners including the Government of Sindh. The Company awaits appropriate policy support to be announced, in order to proceed with the development of a coal to gas ("CTG") facility in conjunction with the planned power plant at Block VI. There are some risks related to obtaining viable tariffs for power and gas in order to maximise returns. Economic risk, however, including cost increases, is protected, through the Government of Pakistan's cost plus pricing mechanism.

The Company has increased the potential of its Thar asset by seeking to develop an alternative solar facility on the land at Block VI Thar where it holds a lease. It has already conducted a preliminary study, obtained provisional consent and secured a collaborative relationship with a large power company.

The Company has made significant progress on its green hydrogen project and continues to work on studies and market access. The project faces risks in getting to production, price risk in relation to off take and cost of production risk on account of supply and transport uncertainty. The Company has engaged experts for technology and commercial support in order to further mitigate risks.

There remains political risk, on account of political uncertainty in Pakistan which may discourage investment. In contrast, Western Australia presents very limited political risk compared to Pakistan with exploration and commercial risk being the primary concern for the potential development of our projects in this jurisdiction.

The principal risks are detailed below, along with the key measures taken for their mitigation.

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