United States
Securities and Exchange Commission
Washington, DC 20549
FORM 10-QSB/A-1
Quarterly Report Under Section 13 or 15(d) of
the Securities Exchange Act of 1934
For the Quarter Ended Commission File Number
December 31, 2004 000-28638
BMB MUNAI, INC.
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(Exact name of registrant as specified in its charter)
NEVADA
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(State or other jurisdiction of incorporation or organization
30-0233726
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(I.R.S. Employer Identification No.)
20A Kazibek Bi Street, Almaty, 480100 Kazakhstan
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(Address of principal executive offices)
+7 (3272) 58-85-17/47
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(Registrant's telephone number, including area code)
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or such shorter
period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days.
Yes [X] No [ ]
State the number of shares outstanding of each of the registrant's classes of
common equity, as of the latest practicable date: common stock, par value
$0.001; 28,513,766 shares outstanding as of February 3, 2005.
Transitional small business disclosure format (check one) Yes [ ] No [X]
BMB MUNAI, INC.
FORM 10-QSB/A
TABLE OF CONTENTS
EXPLANATORY NOTE ........................................................... 3
PART I -- FINANCIAL INFORMATION
Item 2. Management's Discussion and Analysis or Plan of Operation..... 3
PART II -- OTHER INFORMATION
Item 6. Exhibits..................................................... 12
Signatures............................................................ 13
Explantory Note to Amendment No. 1 to Form 10-QSB
This Form 10-QSB/A is being filed to correct errors in the table of
"Contractual Obligations and Contingencies" contained within the Management's
Discussion and Analysis section of the Form 10-QSB for the quarter ended
December 31, 2004, filed by the Company on February 14, 2005. The table
incorrectly disclosed that the Company is contractually obligated to spend
$8,500,000 during the period from "1-3 years" on Capital Expenditures in
connection with its exploration license and contract. The correct amount of that
obligation is $10,500,000. The table also incorrectly stated the obligation to
the "Liquidation Fund" as $20,000 the correct amount has risen to $60,057 as
properly reflected in the Company's financial statements. The table and Footnote
1 to the table have also been revised to reflect the corrections.
The entire text of Part I, Item 2. Manangement's Discussion and
Analysis has been included in this Form 10-QSB/A and reflects the revisions to
the Contractual Obligations and Contingencies table discussed above. Otherwise,
this Amendment No. 1 does not modify or update disclosures presented in the
original Form 10-QSB. This Amendment No. 1 speaks to the original filing date of
the Form 10-QSB on February 14, 2005, and does not modify or update disclosures
contained therein, including the nature and character of such disclosures, to
reflect events occurring, or items discovered, after the original filing date of
the Form 10-QSB.
Item 2. Management's Discussion and Analysis or Plan of Operations
The following discussion is intended to assist the reader in
understanding our results of operations and our present financial condition. Our
Consolidated Financial Statements and the accompanying notes included in this
Form 10-QSB contain additional information that should be referred to when
reviewing this material.
Statements in this discussion may be forward-looking. These
forward-looking statements involve risks and uncertainties, including those
discussed below, which could cause actual results to differ from those
expressed. Please read Forward-Looking Information on page 22.
We operate in one segment, oil and natural gas exploration, development
and production.
Overview
Prior to November 26, 2003, the Company existed under the name
InterUnion Financial Corporation ("InterUnion"). The primary business strategy
of InterUnion was to acquire majority interests in financial services
businesses. On November 26, 2003, InterUnion executed an Agreement and Plan of
Merger with BMB Holding, Inc., a private Delaware corporation, formed for the
purpose of acquiring and developing oil and gas fields in the Republic of
Kazakhstan ("ROK"). Pursuant to the Agreement, BMB Holding merged into
InterUnion, with InterUnion being the surviving corporation. For accounting
purposes, the transaction was treated as a reverse merger under accounting
principles generally accepted in the United States, with BMB Holding and its
then 70% owned subsidiary, Emir Oil, treated as the surviving entity. BMB
Holding was incorporated on May 6, 2003. Following the merger, we changed our
name to BMB Munai, Inc.
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On May 24, 2004, we agreed to purchase the 30% interest of our minority
partner in Emir Oil. The acquisition was made in exchange for 3,500,000 shares
of our common stock. As a result of the acquisition, Emir Oil became a wholly
owned subsidiary of BMB Munai. The acquisition of the final 30% interest in Emir
Oil was consummated during the quarter.
Since incorporation on May 6, 2003, our primary focus has been the
acquisition, exploration, development, exploitation and production of crude oil
and natural gas in Kazakhstan. With the acquisition of the exploration and
development license and contract of Emir Oil, we are focusing our efforts on the
development of the Aksaz, Dolinnoe and Emir Oil and Gas Fields in Kazakhstan
(the "ADE Block").
We anticipate spending between $25 million and $30 million in the
continued exploration and development of the ADE Block in the next twelve
months. In September 2004, we completed a private placement in which we sold
4,584,340 shares of our common stock for $4.00 per share to raise gross proceeds
of $18,337,360. After paying commissions, fees and costs of the offering, we
realized net proceeds of $17,311,906. This money has and will continue to be
used primarily to fund our exploration and development efforts. We also intend
to apply proceeds from the sale of oil we produce during well testing to help
fund our exploration and development activities. We anticipate the need to raise
an additional $40,000,000 to support exploration and development activities
before we expect income from oil production to be sufficient to meet our needs
for operating capital.
Extension of the License Territory
During the quarter, we received written notification from the Ministry
of Energy and Mineral Resources of the ROK that the Ministry had approved and
finalized an amendment to the oil and gas exploration license AI No. 1552 and
Contract No. 482 for Exploration of Hydrocarbons in Aksaz-Dolinnoe-Emir oil
fields held by Emir extending the ADE Block licensed territory by an additional
64,247 acres, (approximately 260 square kilometers.) Reinterpretation of 2D
seismic data from the Soviet Union era performed by PGS-GIS, of Almaty,
Kazakhstan, showed four oil and gas bearing structures of deeper Triassic
formations that have geologic composition similar to the ADE block where
discovered.
The amendment grants us the exclusive right to explore the additional
territory during the remaining term of the license, which expires in July 2007.
Pursuant to the terms of the amendment, we are required to spend a minimum of
$5,500,000 exploring and/or developing the extended territory, with a minimum of
$3,000,000 in exploration and/or development in 2006 and $2,500,000 in 2007.
These commitments are in addition to our commitments under the original license.
4
New Wells
During the next twelve months we intend to spend at least $20 million
to drill new exploratory wells. Initially we will focus our drilling efforts in
the Dolinnoe and Askaz oil fields, where we hope to drill at least one new
exploratory well, Dolinnoe-3, and drill-in two wells, Aksaz-3 and Aksaz-4.
Construction of the Dolinnoe-2 well was completed on January 4, 2005.
Preliminary tests indicated the presence of four oil bearing zones. Inside the
producing intervals core sampling, geophysical research and formation testing
were completed and oil and gas flow was discovered. Preparatory works for more
extensive testing are currently under way. It is anticipated that the Dolinnoe-2
well could go into test production in March 2005. Subsequent to quarter end, a
drilling rig has been moved to the drilling site of the Dolinnoe-3 well. On
January 26, 2005, we commenced drilling of the Dolinnoe-3 well. Presently, the
well has been drilled to 1,194 meters.
In January 2004, dismantling of the drilling rig at the Aksaz-3 well,
which was abandoned during the Soviet Union period, was completed. This rig
hindered further drilling works at this well site. At the present time similar
dismantling works are under way on the Aksaz-4 well. The Aksaz-3 and Aksaz-4
wells were previously incompletely drilled and spudded during the Soviet Union
period to determine the commercial viability of additional drilling at these
sites. During the 1990s, each of these wells was cased to approximately 3,400
meters. The Company expects the cost to drill these wells the remaining distance
to the pay zones will be relatively inexpensive.
Workover of Existing Wells
In the next twelve months we will continue workover of wells existing
since the Soviet Union period in the ADE Block. The Dolinnoe-1 well continues
steady production of approximately 165 barrels per day. The output of this well
is only from the top 7 meters of the pay zone due to equipment that was
abandoned in the well. Removal of this geophysical equipment is planned to occur
during 2005, which should increase production at the well. In December
subsurface workover of the Emir-1 well included the lowering of a deep
sucker-rod pump into the well. We are currently carrying out crude oil and gas
test production at this well site. Finally, during the quarter, we completed
development works at the Aksaz-1 well. As a result, gas and gas condensate flow
was discovered at the Aksaz-1 well.
Infrastructure Improvements
We plan to continue improving existing infrastructure in the ADE Block.
During the quarter we completed construction of 8.6 km pipeline connecting the
Dolinnoe and Aksaz fields. We have also completed construction of a gas
collection and pre-sale processing facility in the Aksaz field for natural gas
produced at ADE Block, including a well head heater, heat exchanger, oil and gas
separator, two pumping units and a 1,260 barrel oil products tank. We also began
developing plans to construct a 16 kilometer natural gas pipeline connecting the
Aksaz processing facility to an existing gas pipeline that ties into the Aktau
gas grid. This will allow us to sell natural gas to customers in Aktau. During
the quarter we also completed installation of a rocker machine on the Emir-1
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well and laid 300 meters of power line to supply electricity for the rocker
machine. In the next twelve months we plan to continue to improve power supply
to the ADE Block through the construction of additional 6 kilowatt power lines
running through the ADE Block. We will also continue expanding the road network
within the ADE Block.
Oil Production and Sale
We have been engaged in test production and selling of crude oil since
May, 2004. Due to a lack of oil storage capacity at the storage facility we
lease, all of our crude oil sales have been to the Kazakhstan domestic market.
The average price per barrel of crude oil in the Kazakhstan domestic market
during that time has been approximately $14 per barrel. During the quarter,
however, capacity at the storage facility was increased from 945 barrels to
20,000 barrels as the result of reconstruction of two ground fuel tanks. With
this increase in oil storage capacity, we are now able to collect sufficient
volumes of oil for export and sale to the international market.
Our revenue, profitability and future growth rate will depend
substantially on factors beyond our control, such as economic, political and
regulatory developments and competition from other sources of energy. Oil and
natural gas prices historically have been volatile and may fluctuate widely in
the future. Sustained periods of low prices for oil or natural gas, or failure
to gain access to markets outside of the ROK, either through governmental
requirement or because of a lack of infrastructure to provide such access could
materially and adversely affect our financial position, our results of
operations, the quantities of oil and natural gas reserves that we can
economically produce and our access to capital.
Results of Operations
Three months ended December 31, 2004, compared to the three months
ended December 31, 2003
Revenues. During the three months ended December 31, 2004, we realized
revenues of $55,904, compared to $0 during the three months ended December 31,
2003. All revenues were from the sell of oil produced in test production. This
increase in revenues in the current year is primarily the result of the fact
that in the prior year we were just beginning operations and seeking to acquire
rights to oil and gas properties. We anticipate revenues will continue to
increase in the upcoming fiscal quarters. At the present time, however, it is
unclear the rate at which our revenues may increase.
Expenses. During the three months ended December 31, 2004, we incurred
total expenses of $1,344,900 compared to expenses of $196,683 during the three
months ended December 31, 2003. Again, the increase is primarily the result of
the growth of our operations during the past twelve months. For instance, during
the three month period ended December 31, 2003, we incurred general and
administrative expenses of $196,412, compared to $1,298,613 in the quarter ended
December 31, 2004. This increase is largely the result of hiring personnel to
6
operate our business, as well as travel and professional expenses including
accounting and legal fees. Also during the quarter ended December 31, 2004, we
incurred production costs of $24,370 and amortization and depreciation expenses
of $21,917. By comparison, we incurred no production costs and depreciation and
amortization costs of $271 in the quarter ended December 31, 2003. We expect
that as we execute our planned business activities over the next twelve months
our expenses will continue to increase at the same or greater rates.
Loss from Operations. During the three months ended December 31, 2004,
we incurred losses from operations totaling $1,288,996 compared to operating
losses of $196,683 for the three months ended December 31, 2003. These losses,
at least in part, are the result of us incurring significant expenses in
connection with the development of our oil fields before we can produce any
significant quantities of oil or gas. If we are unable to develop our oil and
gas fields to a level where oil and gas production and sales offset the costs of
exploration, development and production, we will continue to generate operating
losses until such time as we can no longer continue operations. At this time, it
is unclear when we will generate sufficient revenue from oil and gas production
to offset expenses, if at all.
Other Income. During the three months ended December 31, 2004, we
realized other income totaling $451,333 compared to other expenses of $142,167
for the three months ended December 31, 2003. The current year other income
included realized gains and unrealized gains on marketable securities of $4,712,
net interest of $126,331 and foreign currency exchange gain of $329,339,
partially offset by other net expense of $9,049. During the quarter ended
December 31, 2003, we realized no gain or loss on marketable securities and had
unrealized gain on marketable securities of $197,550, which was partially offset
by net interest expense of $29,463 and other net expense of $25,920. During the
current fiscal year we have raised approximately $17 million through the sale of
our securities in private placement transactions. Therefore, during the fiscal
quarter ended December 31, 2004, we had funds that were not being used in
operations that we invested in marketable securities. We expect to use all of
the funds we have raised to fund our operations. Until such time as they are
needed, however, such funds may be used to purchase marketable securities. We
anticipate that as funds are used in operations over the next twelve months,
gains and losses from marketable securities, both realized and unrealized, will
continue to decrease.
Net Loss. During the three months ended December 31, 2004, we realized
a net loss of $844,413 compared to a net loss of $104,959 for the three months
ended December 31, 2003. As discussed above this net loss is largely the result
of the increased size or our operations at December 31, 2004, compared to
December 31, 2003. We anticipate that we will continue to realize net losses
from operations until such time as revenues generated from oil and gas
production and sales and other income offset our expenses. At this time, it is
unclear when, or if, that may occur.
7
Nine months ended December 31, 2004, compared to the period from
inception (May 6, 2003) to December 31, 2003.
As discussed above, we incorporated on May 6, 2003, therefore, we do
not have a comparable prior period. Rather all comparisons to the period ended
December 31, 2003, will be for the period from May 6, 2003 through December 31,
2003.
Revenues. During the nine months ended December 31, 2004, we realized
revenues of $347,891, compared to $0 for the period from May 6, 2003, to
December 31, 2003. All revenues were from the sell of oil produced in test
production. This increase in revenues in the current year is primarily the
result of the fact that in the prior year we were just beginning operations and
seeking to acquire rights to oil and gas properties. We anticipate revenues will
continue to increase in the upcoming fiscal quarters. At the present time,
however, it is unclear the rate at which our revenues may increase.
Expenses. During the nine months ended December 31, 2004, we incurred
total expenses of $2,851,616 compared to expenses of $226,779 during the period
from May 6, 2003, to December 31, 2003. Again, the increase is primarily the
result of the growth of our operations during the past twelve months. For
instance, during the period from May 6, 2003 to December 31, 2003, we incurred
general and administrative expenses of $226,508, compared to $2,716,894 during
the nine months ended December 31, 2004. This increase is largely the result of
hiring personnel to operate our business, as well as travel and professional
expenses including accounting and legal fees. Also during the quarter ended
December 31, 2004, we incurred production costs of $85,619 and amortization and
depreciation expenses of $49,103 by comparison, we incurred no production costs
and $271 in depreciation and amortization during the period from May 6, 2003
through December 31, 2003. We expect that as we continue to execute our planned
business activities over the next twelve months our expenses will continue to
increase at the same or greater rates.
Loss from Operations. During the nine months ended December 31, 2004,
we incurred losses from operations totaling $2,503,725 compared to operating
losses of $226,779 for the period from May 6, 2003, through December 31, 2003.
These losses were largely the result of incurring expenses in connection with
the development of our oil fields before they produce any oil or gas. If we are
unable to develop our oil and gas fields to a level where oil and gas production
and sales offset the costs of exploration, development and production, we will
continue to generate operating losses until such time as we can no longer
continue operations. At this time, it is unclear when we will generate
sufficient revenue from oil and gas production to offset expenses, if at all.
Other Expense. During the nine month period ended December 31 2004, we
realized total other income of $416,406, compared to $83,881 for the period from
May 6, 2003, to December 31, 2003. The current period other expenses included a
realized gain on marketable securities of $58,944, net interest income of
8
$122,430 and foreign currency exchange gain of $532,025, offset in part by
unrealized loss on marketable securities of $287,944. By comparison, during the
period from May 6, 2003, to December 31, 2003, we realized no gains on
marketable securities and had unrealized gain on marketable securities of
$197,550, which was partially offset by net interest expense of $86,702 and
other net expense of $26,967.
Net Loss. During the nine months ended December 31, 2004, we realized a
net loss of $2,094,069 compared to a net loss of $194,073 for the period from
May 6, 2003 through December 31, 2003. As discussed above this net loss is
largely the result of the increased size or our operations at December 31, 2004,
compared to December 30, 2003. We anticipate that we will continue to realize
net losses from operations until such time as revenues generated from oil and
gas production and sales and other income offset our expenses. At this time, it
is unclear when, or if, that may occur.
Liquidity and Capital Resources
Since inception on May 6, 2003, our capital resources have primarily
consisted of funds raised through the sale of our common stock and debt
convertible to our common stock. We anticipate our capital resources in the
upcoming twelve months will likewise consist largely of funds raised in
financing activities completed during the quarter ended September 30, 2004,
additional debt and/or equity financing which the Company will seek, and to some
level, revenues from oil sales.
Note B of the Notes to the Financial Statements discloses several
factors that raise substantial doubt about our ability to continue as a going
concern. Among those noted is the fact that we will need significant additional
funding to develop the geographical area covered by our exploration and
development license. As discussed herein, we have completed the private
placement of 4,584,340 shares of our common stock raising net proceeds of
$17,311,906. Most of these funds have now been used. We anticipate the need to
raise an additional $25,000,000 to $30,000,000 to meet our exploration,
development, production and operational needs for the next twelve months.
Another factor that raises concern about our ability to continue as a
going concern is the requirement that we must obtain a commercial production
contract from the ROK prior to commencing commercial oil production. While we
are legally entitled to receive this commercial production contract and have the
exclusive right to negotiate such with the ROK, and the ROK is required to
conduct the negotiations under the Law of Petroleum in Kazakhstan, there is no
guarantee that we will be awarded a production contract. If we cannot obtain a
production contract, we will only be able to produce and sell oil under the Law
of Petroleum for the term of the existing contract, which expires June 9, 2007.
Cash Flows
During the nine months ended December 31, 2004, cash was primarily used
to fund exploration and development related activities. We had a net decrease in
cash and cash equivalents of $1,063,085 during the nine months ended December
31, 2004, compared to a net increase of cash and cash equivalents of $6,552,374
in the period from May 6, 2003 to December 31, 2003. See below for additional
discussion and analysis of cash flow.
9
Period from inception
(May 6, 2003)
Nine months ended through
December 31, 2004 December 31, 2003
-------------------- ------------------------
Net cash provided (used) in operating activities $ (8,087,553) $ 97,432
Net cash used in investing activities $(10,287,438) $(5,681,082)
Net cash provided by financing activities $ 17,311,906 $12,136,024
-------------------- -------------------
NET INCREASE (DECREASE) IN CASH AND CASH
EQUIVALENTS $ 1,063,085 $ 6,552,374
==================== ===================
During the nine months ended December 31, 2004, net cash used in
operations was $8,087,553, compared to net cash provided from operations of
$97,432 during the period from May 6, 2003 to December 31, 2003. This
significant increase in net cash used in operation was the result of our
aggressive exploration and development strategy, as net loss, increase in
inventories, increase in prepaid and other assets, restricted cash and deposits
was only partially offset by increases in accounts payable and accrued
liabilities. Net cash used in investing activities was $10,287,438, compared to
$5,681,082 for the period from inception to December 31, 2003. The increase in
net cash used in investing activities included investment in a short term loan
receivable, acquisitions of fixed and intangible assets, as well as acquisition
of additional oil and gas properties, partially offset by cash proceeds from the
sale of marketable securities. During the nine months ended December 31, 2004,
$17,311,906 was provided from the private placement of our common stock. At
December 31, 2004, we had cash on hand of $1,063,270, compared to cash on hand
at December 31, 2003, of $6,552,374, again this decrease in cash on hand is the
result of our aggressive efforts to explore and develop the ADE Block. As a
result we have incurred significant costs and expenses, which have not been
offset by significant revenues.
We continually evaluate our capital needs and compare them to our
capital resources. Our budgeted capital expenditures for the upcoming twelve
months are $20 million to $25 million for exploration, development, production
and acquisitions. As discussed above, we have already spent most of the funds
raised in the private placement we completed during the quarter ended September
30, 2004. Therefore, we will need to seek additional funds either in the equity
or debt markets to fund the remainder of our budgeted capital expenditures and
to continue our operations. If we are unsuccessful in obtaining significant
additional capital, we may be forced to significantly curtail our exploration
and development activities or even to terminate operations until such time as
appropriate funds can be raised.
Contractual Obligations and Contingencies
The following table lists our significant commitments at December 31,
2004, excluding current liabilities as listed on our consolidated balance sheet:
10
Payments Due By Period
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Less than After
Contractual Obligations Total 1 year 1-3 years 4-5 years 5 years
- ----------------------------------------------------------------------------------------------------------------------------
Capital Expenditure Commitment(1) $27,000,000 $9,300,000 $10,500,000 $ -- $ --
Due to the Government of Kazakhstan(2) 5,994,745 -- -- 5,994,745 --
Due to Reservoir Consultants 500,000 278,000 222,000 -- --
Liquidation Fund 60,057 -- 60,057 -- --
- ----------------------------------------------------------------------------------------------------------------------------
Total $33,554,802 $9,578,000 $10,782,057 $ 5,994,745 $ --
============================================================================================================================
(1) Under the terms of our Contract with the ROK, we are required to
spend a total of at least $27 million dollars in exploration, development and
improvements within the ADE Block, as extended during the term of the license,
including $9.3 million in the 2005 calendar year, $6 million in the 2006
calendar year and $4.5 million in the 2007 calendar year. If we fail to do so,
we may be subject to the loss of our Contract.
(2) In connection with our acquisition of the License and Contract, we
will be required to repay the ROK for exploration and development expenditures
incurred by it prior to the time we acquired the License and Contract. The
repayment terms of this obligation will not be determined until such time as we
are granted a commercial production contract. Prior to commencing commercial oil
production, we must obtain a commercial production contract from the ROK. While
we are legally entitled to receive this commercial production contract and have
the exclusive right to negotiate such with the ROK, and the ROK is required to
conduct the negotiations under the Law of Petroleum in Kazakhstan, there is no
guarantee that we will be awarded a production contract. Moreover, at this time
it is unclear when might apply for a production contract or when it might be
issued, if at all. Therefore, we have made our best estimate as to when we
anticipate becoming subject to this repayment obligation.
Off-Balance Sheet Financing Arrangements
As of December 31, 2004, we had no off-balance sheet financing
arrangements.
Recently Issued Accounting Pronouncement
In December 2004, the FASB issued a revision of SFAS No. 123
"Share-Based Payment" (No. 123R). The statement establishes standards for the
accounting for transactions in which an entity exchanges its equity investments
for goods and services. It also addresses transactions in which an entity incurs
liabilities in exchange for goods or services that are based on the fair value
of the entity's equity instruments or that may be settled by the issuance of
those equity instruments. The statement does not change the accounting guidance
for share-based payments with parties other than employees. The statement
requires a public entity to measure the cost of employee service received in
exchange for an award of equity instruments based on the grant-date fair value
of the award (with limited exception). That cost will be recognized over the
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period during which an employee is required to provide service in exchange for
the award (usually the vesting period). A public entity will initially measure
the cost of employee services received in exchange for an award of a liability
instrument based on its current fair value; the fair value of that award will be
remeasured subsequently at each reporting date through the settlement date.
Changes in fair value during the requisite service period will be recognized as
compensation over that period. The grant-date for fair value of employee share
options and similar instruments will be estimated using option-pricing models
adjusted for the unique characteristics of these instruments. The Company will
be required to comply with this pronouncement for periods beginning after
December 15, 2005.
Effects of Inflation and Pricing
The oil and natural gas industry is very cyclical and the demand for
goods and services of oil field companies, suppliers and others associated with
the industry puts extreme pressure on the economic stability and pricing
structure within the industry. Typically, as prices for oil and natural gas
increase, so do all associated costs. Material changes in prices impact the
current revenue stream, estimates of future reserves, borrowing base
calculations of bank loans and value of properties in purchase and sale
transactions. Material changes in prices can impact the value of oil and natural
gas companies and their ability to raise capital, borrow money and retain
personnel. While we do not currently expect business costs to materially
increase, continued high prices for oil and natural gas could result in
increases in the cost of material, services and personnel.
Forward Looking Information and Cautionary Statement
The statements regarding future financial and operating performance and
results, market prices, future hedging activities, and other statements that are
not historical facts contained in this report are forward-looking statements.
The words "expect," "project," "estimate," "believe," "anticipate," "intend,"
"budget," "plan," "forecast," "predict," "may," "should," "could," "will" and
similar expressions are also intended to identify forward-looking statements.
Such statements involve risks and uncertainties, including, but not limited to,
market factors, market prices (including regional basis differentials) of
natural gas and oil, results for future drilling and marketing activity, future
production and costs and other factors detailed herein and in our other
Securities and Exchange Commission filings. Should one or more of these risks or
uncertainties materialize, or should underlying assumptions prove incorrect,
actual outcomes may vary materially from those indicated.
Item 6. Exhibits
(A) Exhibits. The following exhibits are included as part of this report:
Exhibit 31.1 Certification of Principal Executive Officer
pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.
Exhibit 31.2 Certification of Principal Executive Officer
pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.
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Exhibit 31.3 Certification of Principal Financial Officer
pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.
Exhibit 32.1 Certification of Principal Executive Officer
pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002.
Exhibit 32.2 Certification of Principal Executive Officer
pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002.
Exhibit 32.3 Certification of Principal Financial Officer
pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this to be signed on its behalf by the undersigned
thereunto duly authorized.
BMB MUNAI, INC.
February 16, 2005 /s/ Alexandre Agaian
---------------------------
Alexandre Agaian,
Co-Chief Executive Officer
February 16, 2005 /s/ Boris Cherdabayev
---------------------------
Boris Cherdabayev,
Co-Chief Executive Officer
February 16, 2005 /s/ Anuar Kulmagambetov
---------------------------
Anuar Kulmagambetov,
Chief Financial Officer
13