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Erazzel it is indeed possible that BH have carried on since Jan 2019. But I really doubt it to be honest that it has resulted in drilling new wells. If they had we would be generating more cash. If I had to guess they may have done a bit more observation of the well results from 2018 but while the arbitration and Outrider dispute is ongoing I would be surprised if the legal side of any large corporate would enter into any binding agreements. BH deal implied profit share so it can't be ruled out but if that was what was going on I would have expected that to have come out in the press and probably in the docs on the FEGL company. I must admit it I had worked for Frontera for 20 years and got replaced by contractors like that I think you would see more political blow back. so common sense to me and observing the company behaviour leads me to the view very little us happening on the ground. But so strange is this company I never rule anything out. I always like the Sherlock Holmes quote when you rule out the impossible whatever remains however improbable must be the truth. At the moment we are in the realms of the probable which is the company remains distressed financially and fighting off both Outrider and GG to get back to where we were in Oct 2018.
I'd place the major deal and BH working in the field towards the improbable end of the spectrum but not impossible.
Mole, the employees is questionable. Please also note the BHGE would use their own staff etc. So try not to discount too much here please.
It will end in October at the elections. If GD win .. its game over..
If the opposition can cooperate and kick GD out then even if the PSA is terminated completely I I think there is a chance that could be reversed, clearly Zaza is working very closely with the opposition and the opposition see huge benefit in having FRR and the west involved in thier economy.
If GD do win then all those excited investors in BLOE had best beware I see no reason why the exact same pattern would not happen to them as well.
The way I see the elections GD had a pretty small minority previously even with thier bully boy bribery approach to democracy they were only a few % in front of the next largest party. With all this mud slinging and threats from the west to fully withdraw , highunemployment weighing on the voters minds.. and cooperation between the opposition parties I can see a path for GD to be properly booted out.. unless of course Russia ups thier game somehow however I think they have enough problems at home right now. This is no longer about winning those gas fields we are in the game to win the whole country.. (Over to the West) And yes ive seen comments about how the West and Russia both play a diry game and both capable of some pretty dire deeds however ask yourself which system would you rather live under?
Mole - While the Basin Edge is very prospective, with decades of potential hydrocarbon extraction from Taribani; pipeline capacity limitations; limited local market (Georgia); and a world that is moving away from fossil fuels, the Basin Edge may never be produced. Similarly, when gas from Georgia is supplying the Ukraine, will Dolphin be economically viable.
Your geopolitics point is key, CF73. Whatever Zaza’s intentions and reassurances over the past few years, this situation is not in his control or America’s. I think we investors all turned a blind eye to the true state of Georgian politics and thought that a supermajor or a successful gas drill or a new CPR could steamroller things through to success. Clearly, Zaza and Steve, with backing from paid lobbying US senators, are trying to exert as much influence as they can in the political sphere. Where this ends is anyone’s guess but some kind of ending is surely close. If only it had been as simple as poking some holes in the ground and extracting billions.
A reply was mentioned on Agenda.GE 5th June by the Economy Minister as below:
How has the government responded to Frontera?
Georgian Economy Minister Natia Turnava has responded to the open letter of Frontera, saying that Frontera has lost the arbitration dispute and must fulfil its obligations.
She also called on the company to disclose the decision of the arbitration, which will shed light on who is right in this dispute. The parties have no right to make the decision public without the mutual consent. Georgian state-owned corporations say they will announce the decision if Frontera agrees while Frontera does not make comments.
Our answer is very simple. We always respond to such statements from the company Frontera with meeting the international norms... if you want to get more information and find out the truth let's all together call on Frontera to make the decision of the international arbitration public", said Turnava.
It will be interesting to see the reply from the GG/GOGC after the latest letter and TV appearances from Zaza. Will they double down or step back a bit ? Normally they are quick to reply. I wonder if they are having to put a lot more thought into this next chess move.
Cheer up Mole.
If we are capable to entering the bidding later in the year we may well have some serious firepower behind us plus lots of contacts and kudos with the new Government, if it doesn;t work out it wouldn't have mattered anyway. As has been seen there are nlot many serious comnpanies willing to take on the eastern block for the reasons we rae all too familar with sure there is BLOE but if we are still in existance when the time comes I suspect FRR will be a much greater force to be reckoned with than BLOE.
As for the employees, sure its not good but its pretty clear it was never hte intention of FRR to create this situation you can hardly blame them, its possible FRR have used the unemployment plotivally to their advantage as if to say cut off western investmetn you create unemployment.. doesn;t look good for the current government.
What we are seeing in the media really is unfolding the real issues here.. those issues run deepand are ironically more important to all of us that whatever investment we have made, if Europe becomes energy thrall to Russia we will be in a very bad position indeed.
Good Luck all.
CF73 I'm still pretty miffed about a large part of the 99% we may have lost (let alone the prospect of it being 100%!). Basin Edge whilst challenging almost certainly was very prospective for a company with deeper pockets. The deeper gas prospect spread from far to the north of taribani and down to the edge of the block and to the east through Mirzani out towards Basin edge. Whilst there is likely high value in the 1% bit that's left - the lost bit is very significant and its a mistake to mimimise it or characterise it as wasteland as I've seen a few call it. Its unproven but likely contains significant reserves that need the right technology and funding to extract profitably. And that has always been the challenge in Georgia. On the Geology and possibly politics the Schlumberger exit from block 10 remains of interest. They have gone deeper to look for gas and based on what they saw and maybe their own financial plans have exited leaving a residual interest in the asset via Block. Those results should provide a reasonable read across to parts of block 12. All this is why the company have tried hard to avoid relinquishing.
Its also not impossible for FRR to join the bidding when the blocks come back to tender - that of course could occur after the elections! So always possibilities here both ways as the board attempt to navigate a way through this. But the way the employees seem to have got caught in the cross fire of GG and Outrider along with shareholders has been very unfortunate and should not be forgotten. I'm not comfortable personally as a shareholder that the company employees have suffered in this period.
But you are correct the politics is a difficult dimension to attribute risk in an investment.
The sooner we know what we have lost the better and the sooner the next events unfold will allow clarity for shareholders and employees on the future direction.
Just a few quick thoughts after all this news,
1. Thanks to DomFok, in particular, and also to Looed, not ot mention the number of other regulars here. Has got to best ever board as far as a deslisted share is concerned
2. I am not pleased that our investments are so heavily entangled in geopolitics of this kind (I say this as a one-time student of international relations). But I guess I should have been more open to this possibility - it is energy after all.
3. It seems ever more increasingly clear (to me at leats) that FRR came out of arbitration OK, that we retained the 1% that mattered
4. ...that GG are increasingly desperate (they could have just tried let it go away quietly but have not, perhaps under pressure from Russia - but it will blow back in their faces and clearly has started to).
5. If GG had played fair, imagine how, after all this time and all this despair, what the company might be able to tell us and, indeed, how it might open in terms of business as normal (or perhaps am being too optimistic?)
6. I do not buy into the idea that one-side is inherently good and the other bad. The present situations of the US and Russia are a testiment to that. What I do understand and accept is that Russia are an impediment to my investment. For that reason, I hope they throughly lose!
7. If I had known the levels of geopolititics involved with FRR, I would have avoided it, to be honest.
8. How FRR have survived to this point is nothing short of miraculous.
9. I sense GG softening in their position.
10. Lets hope that GG pull back very soon and allow us to realise fruit of all that hard work and hope.