Member Info for aligator

GGITS, T35 has a point worthy of further analysis. As we all know, triggering such options creates an immediate tax liability (for most of us at 40%) on the gain between the option price and the share price on that day. Therefore, the lower the share price the lower the tax liability. Given this background, I would note that the share price on 1 April was 11.5p and dropped to 10.625 by 17 April. However it then increased steadily to around 13.50-14p over the last few months. So triggering an option at, say, a sp of 14p would have increased the tax liability by around 50% compared to triggering at a sp of 10.625p. On ca 1.5m options, this would have increased the tax liability by almost £30,000 (from £58,000 to £87,000), not small change.
I have my own reservations about the security of inside information in the AIM market and could be easily persuaded that pillow talk, friendly chat/advice, etc account for the many such trades.

Hi GG, I would beg to differ. There was no explanation of the complexity during either the conference call or EGM - we were just told it was taking longer than anticipated. Further, the RNS of 2 July merely states "As previously indicated, the process of agreeing the required documentation has highlighted certain legal complexities relating to land title..." Firstly, previous indications were that the issues was not complex and that it was just a matter of time. Secondly, after some 9 months of negotiation one has to wonder what on earth took so long to resolve.
Don't get me wrong, I am delighted to see the matter now resolved and the SP ticking up again. I guess we will never no why it took so long to resolve the Bacton issue but it does tend to speak volumes when BoD's decide to clam up or claim confidentiality issues for such a long period of time. Let's hope that Harvey goes according to plan and there is success with the farm-out.
Best wishes.

T35, No problem. I had not actually focused on the selling of the shares, more on said former officer paying a very large sum of money to the taxman at a time when there remain numerous uncertainties. Today's RNS removes one of those and derisks the core project further, leaving the Harvey well and farm-out as the two major remaining pieces of the jigsaw puzzle.
It is now clear, confirmed by Hockey, that the purchase of TRF was much more complicated than we had been given to understand. My question is simple, why couldn't the BoD have told shareholders this months back? I doubt such a statement would have had intelligent investors running for the hills and by doing so the BoD would have been complimented for keeping us informed. Instead, we have had months of silence, building considerable ire from the very people the BoD need to keep onside.

Worthwhile pointing out that, while this involved over 1.5m additional shares being issued, the option was triggered by a former officer of the company and, based on a share price of ca 14.40p and 40p tax bracket, would have created an immediate tax liability of ca £80,000. Pretty chunky money to be throwing at the taxman if the perception is that the company is going nowhere.

... of 500,000 at 15.50p ca 12.30pm.

Peakview, I don't disagree with your comments but, bluntly, this RNS has told us nothing more than we already know, except to confirm that an Armageddon scenario had not befallen the company. This is not about cutting the BoD some slack, it is about holding it to the undertakings and promises made to shareholders during the telephone call and EGM. Frankly, as I said, this "update" could and should have been made weeks ago. The fact that it has taken this long cast doubts, in my mind, on the experience of the BoD and its advisors in dealing constructively with the issues at hand.
I would note that there now appear to be more than just the land title issue holding up signature on the Thames Reception facilities. While I can only presume that because there are numerous players involved - many with no real interest in what IOG is seeking to do - I remain puzzled as to just what is the problem here which has now dragged out for over 6 months.
These are my investigative views. They are not meant to argue against other posters' thoughts but to seek to put some certainty on the 3 key issues at this time - Harvey, Bacton and Farm out.

Pleased to get an update but, reading it thoroughly, have to say that it contains no ground breaking info and, frankly, could have been released weeks ago.
What intrigues me (negatively) is the use of the words "significant amount" within the statement "The farm-out is intended to provide a significant amount of development funding and represent a major milestone towards Final Investment Decision (FID) on Phase 1 of the Core Project, which is planned at the earliest feasible time". If I am correct, this is the first time the BoD has stated that the farm process will not provide 100% of development funding, which suggests that any shortfall is going to require third party debt or, sadly, more equity. Anyone got similar thoughts?
At the bottom line, good to get an "update" but, disappointingly, the company is still unable to confirm finality with any of the three key issues - i.e. permissions etc for the Harvey well, success with the farm out or the Thames Reception Facilities.
Accordingly, can't see the share price doing anything spectacular on the back of this RNS.

Anyone got a view on the current drift south?

Peakview, I am not a glass half-empty person, but rather someone who seeks logical explanations for events, i.e. how the share price of a company can rise on the back of zero information and known pressure points in various critical areas of operation, e.g. Bacton, funding for the core project, etc. For the record, there are more parties than just the Crown Estates in play on the Bacton issue, otherwise the documentation would have been signed months ago.
Perhaps you could educate me as to how an intelligent investor, given the lack of information and known problems, would, to use your words, "not wait for updates and announcements" and, as we saw yesterday, gamble £80,000 (in buying 500,000 shares) merely on "confidence in substantial figures".
I am not seeking to undermine your or any similar views - you are entitled to such. However, I seek a rational explanation to events which just cannot make sense from an investment market perspective, unless confidential information has leaked..

stubluekpl, share price certainly appears to be reflecting confidence but, per my previous postings, on the basis of what? We have had the square root of nothing by way of updates or announcements for some time now and it is clear that the Bacton issue is far greater than was advised by the BoD during the conference call or EGM.
Various posters have suggested that the FID, due to be announced shortly, is behind the uptick but this is just pure speculation since the reality is that the FID could be further delayed or even worse if the company is unable to secure funding for the core project.
No shareholder is more pleased than me to see the SP breaking 16p again but, given the above, on the basis of what?

butd, QED. To be specific, on what basis would any investor, assuming they are bereft of any confidential information and fully aware of the challenges experienced by the company during the last 6 months, suddenly decide that to buy shares on the basis of a possible (positive) rerate in the near future? That just would not make sense to any intelligent investor unless, of course, said investor was in possession of information not yet available to the market. Is that the background here? After all AIM is renowned for such antics and there have been previous scenarios with the company of increased buying shortly ahead of positive RNSs. At the bottom line, it is remotely possible that this is due to a lack of supply but the probable reality is yet another AIM company leaking like a sieve.

Peakview, You make a valid point. I have been critical of the BoD for some months (and continue to feel that previous pledges on the subject of communication have just not been met), but am nonetheless happy to see this uptick. That said, I am once again mystified as to how and why, in the absence of any public statements/information whatsoever and a share price trading around 14p, someone is willing to pay 16p - a premium of over 14% - for 500,000 shares. It just does not make investment logic. Or is this just another example of an AIM listed company keeing confidential information in a sieve?

As time marches on and we continue to await updates of any sort, my analytical mind is now turning to the issue of plan B's/fall back positions and just where does the company go next if it fails to secure long term funding? Forget about the drilling of Harvey and finalising documentation on the Thames Reception Facility (Bacon) - the critical issue here is securing the funding to develop the core project. Without it the company faces a bleak future.
I guess the very bottom line would be a fire sale of the licences but we all know that, in such a scenario, this will generate only a fraction of the assessed NPV of the gas. Certainly, if I was one of the mid cap companies, I would be casting my ruler over IOG's assets and holding back to see if I could pick them up on the cheap.
In my view, "Mid-year" (as quoted during the conference call and EGM) is the end of this month/first couple of weeks of July. Or does the BoD see this as extending to August and September? at what point does the BoD consider that it needs to provide information to its shareholders?
Apologies for the negativity but, having been one of the BoD's biggest supporters, events over the past 9-12 months have generated far more scepticism than expectation. This has not been assisted by recent refusals by the BoD to provide updates on various milestone issues, specifically to provide detail as to why progress has been so slow.
These are my own thoughts and I would of course, as a LTSH, be delighted to see the company succeed. Thus, any other views would be welcome.

Turtle82, This would appear to be a standard option exercise by a "former officer". However, we all know that such exercises trigger immediate income tax liability on the profit achieved, in this case ca £32,000. So, assuming said "former officer's" top tax rate is 40%, then he/she will be liable to pay ca £13,000. Not a huge amount to risk but does he/she know something we don't?

I find it disappointing and irritating that people use this board to pursue feuds or, indeed, seek to personally insult one another. To my mind the board should reflect the thoughts and views of shareholders and other investors on the prospects or otherwise of IOG, irrespective of whether they fit with the thinking of others. I am happy to admit that I am always willing to learn and be educated on issues I have limited knowledge of.

600T, Just to let you know that I am reading all your posts. Your email to AH is a good call since RS has not even the etiquette to acknowledge your original message - if only to say he is busy but will respond asap.

To be blunt, I am beginning to read the BoD in a similar vein to our Parliament and more specifically the MPs that attend it. That is, it is not listening to what the shareholders are saying (i.e. more communication) and how shareholders are feeling at this time.

I just hope that AH has the courtesy to get in touch with you.

600T, Any response?

FT, Thanks. Indeed, positive news. SP up to 14p as of writing. What is road the corner?

Hi Turtle82, Where did you see this RNS? There is nothing on this site (at the moment) nor within IOG's own website.

rxdav, You make a good point about the discussion on this subject during the conference call. I too thought that the BoD got caught short on the question and I well remember AH's unequivocal answer that "Bacton would happen". For what it is worth, I raised the same issue during the subsequent meeting and sought further confirmation that all business points had been agreed on the deal and that it was just legal documentation that was holding up progress. Again, AH stated that the issue of legal title was being dealt with but subsequent silence on the whole issue would strongly suggest that the problem is bigger, deeper, etc than previously believed and/or other issues have surfaced which are causing further concern.
It is all well and good saying that we need to give the BoD time and wait a few weeks but, frankly, it has been more than a few weeks since the meeting and we seem to be no further forward on Bacton. Quite simply, given the mandate provided to the BoD by the shareholders by virtue of approving the equity raise, etc, we need to be kept much more in the loop on what is happening. As you and I agree, the BoD appears to have the competence but needs to reagin our trust.