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Apart from the $100m the rest fits with what was already known.
The $100m is a puzzle. The accounts are consolidated group accounts so its hard to tell which bits have been consolidated from which subsidiary. But the $100m is way higher than last set of accounts when we owed $40m or $50m at worst 2 years later.
To add $60m of debt would be inconceivable.
Is the amount matching the Durham amount a coincidence? If they had obtained a loan then they would be sat on the cash if they had drawn it down.
Doesn't make alot of sense to draw down the lot. So I'm not sure what to make of it.
I am assuming of course that FRR us is part of the group structure and wholly owned by Frontera.
The $100m figure was in clause 6.3 of Article 6 of the Farmout Agreement so I’ve typed out the full text as it also states the obligations of FRUS to be:
6.1 FRUS shall assume and timely pay from the Effective Date, as they accrue 100% of FRGC’s share of Costs and Expenses of the Minimum Work Program until the Minimum Work Program is completed.
6.2 FRUS shall in its performance of its obligations hereunder and in accordance with the PSA, timely satisfy all milestones as agreed in writing between the Parties or as otherwise provided in the PSA, and shall, in any event, complete the Minimum Work Program within five years following the Effective Date.
6.3 FRUS shall assume, pursuant to mutually agreed documentation as between the Parties no later than 30 days following the Effective Date, $100,000,000 of FRGC’s outstanding debt owed to Frontera Resources Corporation.
6.4 FRUS shall assume any and all obligations of FRGC arising out of that certain Farmout Agreement (including its annex) antered into between FRGC and Varang Exploitation Limited on April 9 2014.
6.5 FRUS covenants to, at all times, perform the Minimum Work Program in strict accordance with all applicable Codes and Standards.
6.6 FRUS shall pay to FRGC 5% royalty on all production from Block 12 for so long as FRUS is entitled to its sharing allocations provided in Article 7 below.
6.7 FRUS shall assume all liability for plugging and abandoning activities in Block 12.
6.8 FRUS shall assume the defence of, and shall bear all costs, expenses and other potential liabilities relating to, any litigation or arbitration proceedings involving FRGC or its Affiliates with respect to performance by FRGC or FRUS of its obligations under this Agreement or the PSA. FRUS also hereby accepts all rights, benefits and clams of FRGC with respect to any and all of the foregoing matters. The assignments and assumptions provided for in this Article 6.8 shall cover any and all costs, expenses, liabilities, rights, benefits or claims at any time or accruing whether prior to, as of or after the Effective Date.
Article 7 Sharing of Cost Recovery, Profit Oil and Costs and Expenses.
7.1 The Cost Recovery Petroleum and Profit Oil produced under the PSA within the Farmout Area, as well as Costs and Expenses pertaining to the Farmout Area, shall be attributed and allocated to FRUS and FRUS shall be entitled to participate in the reimbursement of Costs and Expenses from Cost Recovery Petroleum relating to the Farmout Area as if FRUS had owned an undivided Participating interest in the PSA from the inception of the PSA.
Mole, I too found the $100m figure odd as it suggests that at some point FRGC had been loaned at least $100m from the Frontera Resources Corporation (0011520006, first registered on 08/05/1997) which I assume to be the parent company and is identified as the Registered Agent Name of FRUS.
Am I misreading this
"owed to Frontera Resources Corporation."
owed to... ?
EkXoc - I think that's 100 million, not a billion. Sorry - a pedantic point, but quite a large difference!
100 million is however an nteresting number.
Loan notes should be about $30m. We had other debt.
$2m preference shares for YA. and about $10m of other debt to vendors etc.
So balance would be $60m to make $100m. The same amount as was proposed by the New York fund in 2018.......
That is odd.
Well-oiled so you have concluded same as myself that the license and all the debt is with FRR US.
They left the 5% production in Frontera Georgia for when FIT got that via taking control of Frontera Caucasus.
So apart from the additional possible investment from Green which to me also sounds like a production share royalty there remains no evidence of a further transfer and the PSA pending possible termination by GG or repudiation in the arbitration itself or further court action via Outrider remains in FRR US.
Nice summary thanks welloiled.
This part caught my eye
FRUS shall assume, pursuant to mutually agreed documentation as between the Parties no later than 30 days following the Effective Date, $100,000,000 of FRGC’s outstanding debt owed to Frontera Resources Corporation.
Thats a large number
£1Bil owed to FRR?
From going through the documents, this is what I understand to be the situation with Frontera companies.
Leva Bakhutashvili and George Janiashvili were appointed (26/04/2019) as the lawful attorneys with powers and authority for Frontera Resources US, a Texas limited liability company 8025586654 (FRUS) to initiate and complete formalities required by Georgian law relating to the transfer of ownership title to 50% of share capital of Frontera Eastern Georgia (ID 204905674) (aka Istern; FEG or FIG, address: Georgia, Dedoplistskaro, Gorgasali St., ?15) from Frontera Resources Georgia Corporation (a company organized under the laws of Cayman Islands, incorporation number 72227, FRGC) to FRUS. Also, to undertake any and all acts and execute any and all documents to effect the transfer of ownership title to 50% share capital of FEG from FRGC to FRUS and to duly register it under the laws of Georgia.
On 18/11/2019, FEG was reincorporated with 50% owned by Frontera Risors (or Risoriz) Georgia Corporation, CR 72227 / USA (address Tbilisi, Vake-Saburtalo district, Paliashvili str., No12) and 50% owned by the JSC Georgian Oil and Gas Corporation (ID 206237491); Zaza is the General Director. Frontera Risors Georgia Corporation, CR 72227 / USA appears to me to be the company registered in the Cayman Islands. FEG’s areas of activity are the search and extraction of oil and natural gas.
Frontera Resources US LLC's Branch Office in Georgia (ID 405339637, aka Frontera Risorsiz Yu) was registered 11/06/2019 (address Georgia, Tbilisi, Vake District, Paliashvili Str., 12A).
Frontera Risorsiz Georgia Corporation Branch in Georgia (ID 204931431, address: Georgia, Tbilisi, Vake-Saburtalo District, Paliashvili str., No12) appears to have been liquidated (or is in the process of) on 11/05/20.
The farmout agreement of 13/04/2019 FRGC assigned to FRUS an undivided 100% Participating Interest in the PSA with respect to the Farmout Area (Block 12) and its entire Operating Company interest. FRUS shall pay to FRGC 5% royalty on all production from Block 12 for so long as FRUS is entitled to its sharing allocations. FRUS shall assume, pursuant to mutually agreed documentation as between the Parties no later than 30 days following the Effective Date, $100,000,000 of FRGC’s outstanding debt owed to Frontera Resources Corporation.
FEG’s address is in Dedoplistskaro which lies just to the north east of Taribani (80 km2), Oil: 1,033 MMbbl (OOIP) of which 155 MMbbl is recoverable; Natural Gas: 4.6 TCF (OGIP) of which 3.2 TCF is recoverable.
There are 5 Frontera Resources companies registered in Texas (Texas SOS File Number): Frontera Resources Corporation (0011520006), Frontera Resources Holdings, Llc (0801460203), Frontera Resources International Llc (0802247983), Frontera Resources Ukraine Llc, (0802275570), Frontera Resources Us Llc (0802558654).