2017 Financial Results

16 March 2018

ARGOS RESOURCES LIMITED

("Argos" or "the Company")

2017 Financial Results

Highlights

Argos Resources Ltd (AIM: ARG.L), the Falkland Islands based exploration company focused on the North Falkland Basin, announces its financial results for the year ended 31 December 2017.

The full Annual Report and Consolidated Financial Statements can be read and downloaded from the Company website: http://www.argosresources.com/news.php?page=regulatory-news 

Argos Resources Limited (+500 22685)

www.argosresources.com

Ian Thomson, Chairman

John Hogan, Managing Director

Cenkos Securities plc (Nomad & Broker)

Derrick Lee (+44 131 220 9100)

Neil McDonald (+44 131 220 6939)

Combined Chairman's statement and Managing Director's review

Oil prices rose steadily during the second half of 2017, supported by sustained production curtailments from a number of leading OPEC and non-OPEC producers. The Brent oil price at year end 2017 approached $67 per barrel, an increase of over $10 per barrel from the beginning of the year. The industry response to this has so far been muted, with concerns about the sustainability of these price levels continuing for the long term.

A Participation Agreement between Noble, Edison and the Company continues to be in effect. The Participation Agreement confirms the Company's entitlement to a 5 percent Overriding Royalty Interest in Licence PL001 in the North Falkland Basin. This royalty interest entitles the Company to 5 percent of all oil and gas produced over the life of the Licence, free and clear of all costs. Also, under the terms of the Participation Agreement, the Company has been receiving quarterly cash payments totalling £300,000 per annum during 2017, which is sufficient to meet its ongoing running costs.

The Company announced in August 2016 that a three-year extension to the Licence had been approved by the Executive Council of the Falkland Islands Government and by the UK Secretary of State for Foreign and Commonwealth Affairs. This approval extends the current Second Phase of the Licence to November 2019, after which a Third Licence Phase of 10 years is available to the Licensees.

With world-wide exploration drilling activities still suppressed, the Company cannot yet forecast when drilling operations might commence on the Licence. However, the Overriding Royalty Interest in the Licence continues through the Second Phase of the Licence and any further phases beyond, and the Company's future running costs are covered, so we remain well positioned. The Company continues to be positive about the exploration potential of the Licence Area.

Results and dividend

The results for the year and the Group's financial position as at the year-end are shown in the attached financial statements. The directors have not recommended a dividend for the year (2016: $nil).

Business review

The Group has returned a profit for the year ended 31 December 2017 of $118,000 (2016: loss of $16,000) which equates to a profit per share of 0.05 cents (2016: loss per share of 0.007 cents). The profit reflects the full effects of management efforts to cut costs in 2016, positive foreign exchange differences and the receipt of income under the Participation Agreement.

Administration expenses were $329,000 in 2017 compared to $427,000 in 2016.

Shareholders' equity has increased marginally from $29.32 million to $29.46 million in the year since 31 December 2016, as receipts under the Participation Agreement offset the administration costs, leaving a small surplus. Cash in the year increased from $701,000 to $758,000.

Outlook for the next financial year

The Participation Agreement with Noble and Edison means that the Group will continue to receive quarterly cash payments totalling £300,000 per annum, in Sterling, which equates to $405,000 at the year-end exchange rate and covers the Group's ongoing costs. There is a risk that Noble and Edison withdraw from the agreement. In such circumstances the Licence would revert back to Argos, subject to Government approval. Given that Noble and Edison have been granted an extension to the Licence, which now runs until November 2019, withdrawal is considered unlikely. The Group is therefore fully funded for the foreseeable future.

Ian Thomson John Hogan

Chairman Managing Director

Consolidated statement of comprehensive income

Year ended 31 December 2017

Consolidated statement of financial position

As at 31 December 2017

Consolidated statement of cash flows

Year ended 31 December 2017

Consolidated statement of changes in equity

Year ended 31 December 2017

In preparing the financial information in this statement the Group, which consists of the Company Argos Resources Ltd, and its wholly owned subsidiary Argos Exploration Ltd, has applied policies in accordance with International Financial Reporting Standards as adopted by the European Union ("IFRS"). The financial information has been prepared under the historical cost convention.

The financial information set out above does not constitute the company's statutory accounts for 2016 or 2017. Statutory accounts for 2016 and 2017 have been reported on by the Independent Auditors. The Independent Auditors' Reports on the Annual Report and Financial Statements for 2016 and 2017 were unqualified and did not draw attention to any matters by way of emphasis.