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No objections came before the court, although the judge considered correspondence from two shareholders who were opposed to the plan.
Mr Justice Quinn was satisfied he should confirm the scheme of arrangement, which will take effect next Wednesday.
Larry Goodman’s €6m Barryroe rescue plan approved by High Court
Most shareholders will be wiped out in plan that will see explorer pivot to opportunities in renewable energy sectors
The High Court has approved a Larry Goodman-led rescue plan for the company behind the Barryroe oil and gas explorer.
Ellen O'Riordan
Fri Nov 3 2023 - 14:15
The High Court has approved a rescue plan for Barryroe Offshore Energy that involves an injection of some €6 million of funding from its main shareholder, businessman Larry Goodman.
Mr Justice Michael Quinn on Friday confirmed the scheme proposed by the oil and gas explorer’s examiner which will see Mr Goodman’s Lorsden (Jersey) Limited company, based in Jersey, invest €1 million in initial funding, with a further €5 million available upon agreement on an appropriate business plan.
Lorsden is the parent company of Mr Goodman’s Vevan Unlimited vehicle, which last July petitioned for the appointment of an examiner to Barryroe, in which it has a 20 per cent stake.
The court application came just days before shareholders were due to vote on putting the company into liquidation after Minister for the Environment Eamon Ryan in May refused to grant a permit for its key Barryroe oil project off the Cork coast.
The court heard on Friday that the plan, put together by examiner Kieran Wallace of corporate advisory firm Interpath Ireland, would involve extinguishing the shareholding of some 10,000 members. Their shares were already worthless when the petition for an examiner came to court as the firm was insolvent, said Mr Wallace’s senior counsel, Kelley Smith.
However, the shareholders would receive a 5 per cent return on any potential future proceeds from the Barryroe oilfield, either through a sale or development.
At a recent creditors’ meeting, 65 per cent of the members’ by value voted against the scheme, while the unimpaired Revenue Commissioners, as a preferential creditor, and unsecured creditors, who will receive 70 per cent of their debt, voted in favour, the court heard.
The Minister for Environment, categorised as a stand-alone class of “decommissioning creditor”, whose “claim is neither quantified nor admitted”, had corresponded with Mr Wallace but did not object to the plan before the court, Ms Smith said. The scheme envisages an expert determination process with engagement from the Minister in relation to its potential claim.
Taking into account the proposed cash injection, including the €5 million that is contingent on the formulation of a business plan, Mr Wallace concluded the company has a reasonable prospect of survival as a going concern.
Ms Smith said the business will shift away from oil and gas exploration towards opportunities in green and renewable energy sectors. The current directors will be replaced on a date to be agreed.
No objections came before the court, although the judge considered correspondence from two shar
Since the government more or less pulled the rug from underneath Barryroe Offshore Energy by insisting that the funding should be three times more than what was required to process the licence, they have in real terms made Barryroe unviable. There has therefore been a pivot to a new renewable energy project, which is still based in Barryroe, so if the new company were to be based around gas storage, it is possible that the oil may still be extracted at some time in the future. Lansdowne, with their 20% share of Barryroe Offshore Energy are still fully based around the oil field. They need a six million euro injection or a take over bid to remove them from the cash shell position they are in at the moment. They also hold the only option to take the legal case to Europe. It would be great for Barryroe shareholders if Larry were to combine with Lansdowne in some form and offer new Lansdowne shares in lieu of their Barryroe shares.
Oil could go through the roof and become scare very quickly, something the government should keep in mind, seeing that Barryroe is one of the biggest undeveloped oil fields in Europe. Even though Larry Goodman's new plan revolves around renewable energy, the current situation in the middle east reminds us that with time, circumstances can change politically, and keeping the opinion of developing Barryroe should be kept on the table. Lansdowne looks like the vehicle to do that and they also carry the live opinion of legal action in Europe.
You are right Manyana. At the moment shareholders are getting nothing so better to vote against the proposal and hopefully Larry Goodman will give a better deal. Some sort of conversion of the Barryroe shares into shares off the new enterprise, whatever that might be. At the moment shareholders are getting zero, so nothing to lose.
I agree. Just before Eamon Ryan cancelling the licence the penny was dropping that Barryroe should merge with Lansdowne but time ran out. Lansdowne have a 20% of Barryroe, so no small percentage. Combining with Lansdowne seems to make sense as they hold 20% of the company and they are the only ones who can take a case against the government to Europe. If they do merge perhaps it allows the opportunity for shareholders in Barryroe to be given shares in Lansdowne in lieu of their Barryroe shares. They are other major shareholders who seem to be on board with Larry Goodman's plan so interesting to see how things end up.
Lansdowne, because they are a UK based company, can bring a case against the Irish Government to Europe using the Energy Charter Treaty. Rockhopper, a offshore oil and gas company that were prevented from drilling by the Italian government were successful when using this treaty. Lansdowne have said that it will cost six million euros to finance the case but they say they have investors willing to back them. As someone already mentioned that just happens to be the same amount Larry Goodman is investing in his new project based in Barryroe. Hard to know what will happen but Lansdowne have leverage and in the last correspondence with the government, the government asked for further talks.
It will be interesting to see if the Sunday newspapers pick up on the story as it is intriguing that Larry Goodman is investing in a renewable energy project and will he take up the opinion of taking a case against the government in Europe and if he will finance the case that only Lansdowne are in a position to take. If a case is going to be taken the government might be in talks to come to some comprise with Lansdowne. The budget happens next week in Ireland so perhaps unforseen future expenses may have to be considered at some stage
It is interesting that Larry Goodman was going to end up with nearly 95% of the share capital before Eamon Ryans cancellation of the licence anyway. So everyone is left with the small percentage they would had to accept anyway. Now a newly named company, still based around Barryroe is getting a big investment ( No need for three times that sum). The question is what is the money going to be invested in. Either a renewable energy project which you would imagine would revolve around storage or extraction of natural gas and the other possibilitily is taking a case for compensation. Possibly both
My apologies Swizz. I am mixing up the AIM Rule 15 period with the 20 year period that Lansdowne have for bringing a case under the Energy Charter Treaty. Interestingly Eamon Ryan has said that gas will be part of the mix going forward as part of Ireland's energy security. There are three possible sources of gas for Ireland. Corrrib ( which will be depleted by 2030), An LNG plant in Shannon that has been ruled out, and the interconnector with Scotland, which is the government's preferred option at the moment, but this leaves Ireland open to unforseen price hikes and may not be as secure as the government believe, especially in a crisis.
Under Alan Curran as CEO, there was a push to establish Barryroe as having a gas ring surrounding the oil field, which was an effort to secure a greener future and government backing for the project. In addition there is also the possibility that the nearby KInsale could be used for gas storage. Perhaps this could form part the government's energy security plan going forward and I wonder if gas storage is the green energy plan Larry Goodman is talking about.
If talks are to continue Lansdowne should look to see the government make a public statement as to their intentions concerning Barryroe. Larry Goodman's updated plans may give the government some policial headroom as regards the future of Barryroe. The Phoneix magazine mentioned earlier this year that Stephen Boldly of Lansdowne had been overlooked for the position of CEO of Barryroe Energy despite his expertise and knowledge around Barryroe so interesting to see that if both companies were to merge would this be something that might be considered this time. Luckily there iis a sunset clause of ten years for the legal case that can be taken against the government in Europe but Lansdowne only have six months to begin legal action so a merger of both companies seems the most logical step
https://www.thephoenix.ie/article/lansdowne-oils-sunset-energy-charter-treaty/
Hopefully they will be able to take legal action against the state while also keeping talks open. As mentioned on this board it really looks like a delaying action by the government as talks were suggested at the latest possible moment.
https://m.independent.ie/business/irish/lansdowne-oil-says-door-still-open-for-legal-action-against-state/a735619027.html
Might be a reserve takeover of Barryroe energy. Lansdowne would remain as the junior partner but it would give Barryroe energy assess to participate in the legal case being taken in Europe. Barryroe energy will be updating the market this week or next on their plans which are based around renewable energy in some form but I don't think the major shareholders in both companies are going to ignore the case that can be taken in Europe or that Barryroe is one of the biggest undeveloped oil fields in Europe which may be developed at some stage depending on the future policial landscape
Lansdowne also have a tax right off build up over the years. Would there be some value there for Larry Goodman if he could retain that percentage in addition to that of Barryroe energy? Lansdowne are also taking a case to Europe which is an option he may like to be involved with. There is always a possibility that the next government may follow the policy of the Conservative government in the UK by drilling for their own oil and gas. Interesting to see next week what happens.
As you have mentioned many times Manyana there was always the possibility that a case could be taken with the ECT. Rockhopper won their case claiming £210. A similar case is now going to be taken by Lansdowne
Given Lansdowne is a UK domiciled company it expects to pursue its claim in international arbitration pursuant to the investment protection regime established under the Energy Charter Treaty to which both Ireland and the United Kingdom are signatories.
Good to realise a RNS immediately to explain that legal action will be taken with more details to follow
The environment and climate and communications minister Eamon Ryan has dramatically turned down an application from Barryroe Offshore Energy to continue its exploration off the Cork coast
In a letter to the company on Friday evening, Ryan informed the company that he was turning down the company's application for a lease undertaking as the minister was "not satisfied with the financial capabilities of the applicant". Barryroe's backed by some of Ireland's richest businessmen.
Vevan, a company controlled by the billionaire Larry Goodman, and a number of other shareholders have agreed to provide 40 milion euros of funding to finance a new drilling programme at the Celtic Sea project. This is now in serious doubt.
Barryroe says that the assessment of the licence application from a technical perspective was "satisfactory". However, the minister said the applicants did not meet the "investment cover critertion as required by the financial capability assessment guidance."
As a result, Barryroe no longer has rights over the acreage, regarded as one of the country's best oil and gas prospects. The company said it "is considering its response to the contents of the letter."
The legal route is the only way forward now. The board would have been aware that this was always a likely possibility and having seen that Rockhopper have been successful in their legal action, hopefully they have been preparing a case to bring to Europe.
Things must be looking up when a new poster talks down Barryroe with his/her first post
Thank you very much for posting these articles Swizz.