Icon Energy Limited Annual Report 2023

Icon Energy Annual Report 2023 57 ICON ENERGY LIMITED AND ITS CONTROLLED ENTITIES FOR THE YEAR ENDED 30 JUNE 2023 Fair value estimation • • • There were no other related party transactions during the year ended 30 June 2023 or 30 June 2022. Proceedings in relation to the renewal application for ATP 855 Non-lodgement of ERC application Lodgement of invalid surrender notice NOTE 19 - FINANCIAL INSTRUMENTS (Continued) The net fair value of cash and cash equivalents and short-term non-interest bearing monetary financial assets and liabilities of the Consolidated Entity, as stated in the Consolidated Statement of Financial Position and accompanying explanatory notes as at 30 June 2023 and 30 June 2022, is a reasonable approximation of their carrying value. There are no other contingent liabilties as at 30 June 2023 (30 June 2022: Nil). NOTE 21 - CONTINGENT LIABILITIES Transactions with Directors and Director Related Entities are disclosed in note 4. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS On 5 September 2023 the Hearing in the Supreme Court of Queensland was held between the Company and the Queensland Department of Resources. Her Honour reserved her decision and will deliver a written judgement, timing of which is not known but could be several months. There are no after balance sheet date events at the date of signing. Non-current non-interest bearing borrowing is initially recognised at their fair value and subsequently - at amortised cost. From 1 April 2022 the Environmental Protection Act 1994 (EP Act) requires that an Estimated Rehabilitation Cost (ERC) application is required to be submitted annually by the Company in relation to ATP855, Environmental Authority number: EPPG02088714. In a letter dated 12 September 2022, the department has formed a reasonable belief that Icon have failed to apply for a new ERC decision at least 3 months prior to the ERC to which the decision relates ends and a penalty issued in the amount of $3,446 (s302 offence) was issued. Additionally, in the same letter dated 12 September 2022, the department has formed a reasonable belief that the Company has been operating without an ERC decision in effect which is an offence under section 430(3) of the Act and a penalty of $13,785 was issued. The ERC is used for financial provisioning purposes under the Mineral and Energy Resource (Financial Provisioning) Act 2018. The Company have had a surety bond in place since 9 June 2017 in relation to ATP855, Environmental Authority number: EPPG02088714 for the amount of $716,698. This represents an amount previously determined by the Queensland Government for the cost of rectifying any damage caused and to cover unpaid royalty, rent, penalties, or liabilities. The amount requires to be updated but is dependent on an ERC application to be submitted before the financial provisioning can be assessed. At the date of the financial report the ERC decision is unknown and therefore not practicable to provide an estimate of the financial effect. Following the expiration of tenure (ATP594 on 16 April 2021) the Company were issued a requirement to surrender of Environmental Authority notice pursuant of section 258 of the Environmental Protection Act 1994. A surrender application from the Company was received by the Department of Environment and Science on 1 August 2023. The application however was invalid as it did not satisfy the legislative requirements under section 262 (Requirements for surrender application) and 264 (Requirements for final rehabilitation report) of the EP Act. A non-statutory notice of “invalid application” was issued to the Company on 11 August 2023. The uncertainties relate to the timing and the amount of costs in the final rehabilitation report. It is not practicable to estimate the financial effect as a valid surrender application has not yet been lodged. The Company is going through the proceedings in respect of the decision by Queensland Department of Resources to refuse to accept the application to renew ATP 855. Icon believes that there is a reasonable probability that the Court’s decision will be made in favour of Icon. However, if the proceedings are unsuccessful, it is likely the Court will order the Company to pay the State’s costs of the proceedings on a standard basis. It is not possible at this time to accurately quantify Icon’s future legal fees for the litigation. NOTE 22 - EVENTS AFTER BALANCE DATE Interests in subsidiaries are disclosed in note 17. NOTE 20 - RELATED PARTY TRANSACTIONS