Stephan Bernstein, CEO of GreenRoc, details the PFS results for the new graphite processing plant. Watch the video here.
#29 Pt.8
J1 - I do not like to spread rumours, but I have to say what information I have. For example, the Georgian Dream government thinks that if the Democrats win the presidential election, they will have no chance and Ivanishvili may be more reluctant to go, so they are a little disappointed that our election is a little earlier than their presidential election. And, if Trump wins again and the Republicans, they have some chance of survival. I do not know why they have this misconception. Does it matter if the Democrats win this election or the Republicans for the formation of relations with Georgia? In general, the Democrats were more active in dealing with Georgia in the past. They were more aggressive towards Russia with their sharp statements and positions and their attention was more towards us. What does the US election results mean for Ivanishvili's government? Because for Georgia, both administrations are friends.
Zaza - I think that if anyone in the Georgian Dream has such an opinion, it is a very infantile opinion.
J1 - It’s hard not to agree, though that makes sense there.
Zaza - It does not work that way in Washington, nor will it work in the future. By the way, whatever documents we were talking about today were always considered in a bipartisan context in the committees, and in the end even more Democrats voted in favor of this document during the voting than the Republicans. The context here is one.
J1 - In other words, everything that was prepared against Ivanishvili is, in fact, bipartisan.
Zaza - Of course. Let no one think that it started now, 1 month ago or 6 months ago. The phrase "Ivanishvili is destabilizing the country for the good of Russia" first occurred in 2016 in the Congress building. In 2016, before this announcement, several years of very hard work was done by U.S. politicians before they officially announced all of this.
J1 - So, today is everything official and it`s not the statement of just one congressman as we are here often told about.
#29 Pt.7
J1 - Let’s also talk about how the formation takes place in Washington, which is a really good place for lobbyists and they work successfully too often. It is a common story that political groups, government officials have lobbyists and they work, however, as you said, Ivanishvili's lobbyists are working in vain at this stage. How are attitudes formed towards countries or specific governments? By the way, there was a myth that reigned in the elite of the Georgian Dream that "America does not have time for us" and until recently the US did not react sharply to certain issues in Georgia, even against democracy. Didn't it all happen suddenly? This has been happening in recent years. In short, where did the myth that "America does not have time for us" come from? How is opinion formed and then what is the system of actions?
Zaza - This story was created and inspired by the Georgian Dream. America has always had time for, it has time for us now and will definitely have in the future as well. Georgia will always be a priority and Georgia will always be very high on that list.
Although the government of the Georgian Dream has managed and achieved so much that there was an amendment for the first time in the history of relations between the two countries, according to which we, a country that has always been very high on the list of priorities, are now with Colombia, Pakistan and similar countries.
J1 -Can we lose the superior quality of a strategic partner with America that we have had so far and for which we have worked for years?
Zaza - Unfortunately, we have already lost. But the United States is well aware that Georgia has not lost, it has lost the government of the Georgian Dream. Our government has made us lose our positions, but they will regain that position, of course, if they take appropriate steps in different directions - be it elections, investments, human rights, the judiciary, which the whole world knows the Ivanishvili government uses as a weapon. If the Georgian Dream changes all this, of course this relationship will improve.
#29 Pt.6
Zaza - The only way out now is for the Georgian Dream government. I will say why it is important to correct this situation first. Correction is important because in today's ruined economy, when companies go bankrupt every day, people lose their jobs every day, people have no income and we all know what the population is like today. The only way out of this is to bring capital into the country, money has to come in, investment has to come in. When the US addresses the Georgian government with such communication and the Georgian Dream government does nothing to remedy the situation, trust me, no investment will flow, no capital will flow, no new businesses will open and people will have no income. Georgia does not have the means to finance this activity with its own money. Therefore, we need good relations with the US like air to bring as much good as possible to the country. This will not happen now if you have such a relationship with the US Legislature, Executive ...
J1 - Is there a chance to fix this? What should Ivanishvili do? How can he get rid of the reputation of the Russian oligarch, which destabilizes Georgia?
Zaza - There is a chance of that, but every 1000 km distance starts from the first step. Therefore, the first step should be that the elections should be held in a democratic and free environment, so that the informed voter, not bought with onions and potatoes and other funds, can make the right choice for his future. Therefore, the government must ensure the creation of such a free environment.
J1 - Suppose the elections were held perfectly by the Georgian Dream. Absolutely none of the rules were broken and he won. Could a congressman who thinks Ivanishvili is a Russian oligarch and a friend of America's enemies continue to have a normal relationship with him? Is such a thing happening?
Zaza - The first step will be to hold elections democratically, which does not suit Russia well, in a model of destabilizing the country. Because this is not a Russian model. If you take this first positive step, the second positive step should be to create a good environment for American investment, it will lead to the creation of many jobs, many people will be employed ...
J1 - Does this government have the resources to do that? Tell us your opinion directly.
Zaza - I honestly doubt it. They have neither the resources nor the desire to do what is important. Even if you hire 25 expensive lobbyists in the US, if you do not have the truth, this truth can not be delivered anywhere. The Georgian Dream government has no truth today. This is the biggest problem and I think it will be very difficult to do it in 2 months.
#29 Pt.5
J1 - This situation has gone quite deep. For example, in the 2021 Foreign Operations Financing Bill 15% aid has been frozen to Georgia. There is no such precedent for Georgia to temporarily freeze some of the aid. I would like to reiterate that within 180 days, this Defense Act was adopted on August 5, the Secretary of State must submit a report to the congressional committees. Let’s list what should be in this report? Is the Georgian government taking effective steps to strengthen democratic institutions in Georgia? Is the Georgian government implementing electoral reform effectively? Does it respect the independence of the judiciary, including independence from legislative and executive interference? Does it effectively implement the necessary policies to ensure transparency and accountability, including in terms of unhindered access to public information? Does it protect the rights of civil society, opposition parties and the media, as well as any other issues that the Secretary of State deems appropriate? Do we know what this means in the language of international relations and diplomacy? When you have such a case and when you know that in 180 days Pompeo has to submit this report to the congressmen and in the upcoming elections there might be some cases of fraud, like it was on the previous elections. In the previous elections, we had videos on one of the channels where the ballot papers were thrown directly into the ballot box, but somehow all this went well. The presidential election was not such a strategic election. Everyone knew that this would not change the government. Today, when Ivanishvili's government should remain in power for a third term or should be changed, it is the task of all those who support democracy in Georgia to change the government in Georgia after the second term. Will the Georgian government, which is under such surveillance, be able to hold these elections peacefully under these conditions?
Zaza - He will be able to do that if it is his will. Will be able to if he wishes. First of all, all this means, by the way, this bill was passed by 295 votes in the House of Representatives, which is unprecedented and a very large part of the politicians who voted are Democrats. So it wasn’t just Republicans. It`s bipartisan decision with huge support.
J1 - The letters which were sent to Georgia are bipartisan as well.
#29 Pt.4
J1 - Insulting? What do you mean that they are illegally criticizing the Georgian government?
Zaza - Basically, they have chosen the topic that if any congressman or senator is critical towards the Georgian Dream government, in the opinion of Georgian Dream they are either misinformed or lobbyists of “Frontera”.
J1 - And, so it turns out that you are the most powerful person in the world because the whole congress, senate and white house is working for you. (laughing). I am happy that you are our guest. If I need the letter, will you help me to get it from Congress? This was joke of course. Let`s continue our discussion. What are these lobbyist groups trying to achive? To convince Washington that there are no threats to democracy here, no political prisoners, and in what direction are they working according to your information?
Zaza - The Georgian government has chosen an anti-American and anti-Western direction. This political vector is inclined towards Russia, so in order to justify, on the one hand, they are engaged in anti-American and anti-Western actions, but they try to pretend as if this is not the case. To justify this, they need someone to embellish the picture, and that is why they have hired American lobbyists to send messages to the US government and lawmakers, to the executive branch, to reassure American politicians that Georgia is in favor of strategic cooperation with them and has nothing to do with Russia. In fact it is completely different and as time goes by ...
J1 - What is the reality?
Zaza - The reality is that…
J1 - Ivanishvili and perhaps no one in the government does not want to sever ties with the United States, at least because America is helping Georgia financially among them and I think it is be very important for the country with our economy. It seems that the Georgian government does not want to cut ties with the United States. At least, because he can not oppose the choice of the Georgian people so openly.
Zaza - That's what it's all about. Any poll ...
J1 - Do they know this in America?
Zaza - They know it in America and Georgia as well. That’s why they can’t do it so directly. They do it secretly. You need this America because there is so much help coming from there. And, the aid received from the United States to date exceeds 5 billion. Therefore, they need it. On the other hand, how do you imagine this is a strategic relationship when American NGOs are publicly cursed and fought. When American politicians publish insulting articles in the Georgian or foreign press. It is a very bad investment environment for American companies and they are being persecuted and harassed from the country. And all letters received from the United States were left unanswered. With only 1-2 exceptions, to which they answered with another lie. So it does not fit into a strategic relationship. Everyone sees this well, both in Washington and in the rest of the world.
#29 Pt.3
J1 - Anyway, since December, there has been one-way communication with letters sent by congressmen to Gakharia.
Zaza - Very actively. Quite actively and in the history of modern Georgia, Giorgi Gakharia will be the second Prime Minister who did not go to the United States to deepen relations. Against this background, we have witnessed numerous letters sent to the Georgian Dream government from the Congress, the House of Representatives, the Senate. As you mentioned, for the first time in the history of Georgia, even Pompeo was sent a very critical letter by congressmen and senators in relation to Georgia, stating that Ivanishvili's government is cooperating with rivals and enemies of the United States and doing so at the expense of US political and commercial interests. Such a thing has never happened before and it is very disturbing.
J1 - These words and phrases sound like a judgment. Is it possible for the US to continue its relations with the Georgian leader? Ivanishvili is the informal leader of Georgia today. Georgia is very precious to America. He is our friend and we always stand by him, but because Ivanishvili is the de facto ruler of Georgia, can he continue to have a relationship with him after these phrases, which is really like a sentence? Ivanishvili is cooperating with America's enemies.
Zaza - After these phrases and letters, a very interesting thing happened. The Georgian government has intensified its lobbying activities. New lobbyists were added to his lobbyists. It is worth noting here that only Georgia and Saudi Arabia pay the highest price to lobbyists in Washington.
J1 - What price do they pay for it? It`s public information, as I know. Could you please give as the data?
Zaza - This is public information. $ 75,000 is a monthly fee, plus additional costs. These are the expenses of only 1 company.
J1 - How many companies does the Georgian government have today, Ivanishvili personally, hired in Washington?
Zaza - They use up to 5 companies. They work in different directions. Kay Street is in Washington, where all these lobbying companies are located and they talk about Georgia with a smile because you have to be very bad at something, in order to hire so many lobbyists and pay so much money. That does not happen in practice, no one else does that.
J1 - Roughly speaking, they spend about $ 300,000 a month on these lobbyists.
Zaza - Roughly speaking there will definitely be so much money. Plus, it's very important, for example, that several political leaders of the Georgian Dream government had previously published insulting articles in the Hills newspaper towards congressmen and various people, and in such a short period of time that it cost more than $ 100,000 to publish just one commissioned article.
#29 Pt.2
Zaza - The difference is that of course there was always criticism, there was always an active relationship. There has been an attempt to rectify the situation with this criticism and then respond to different authorities for a strategic partner, but one thing is different now. One is that the support of the United States has never been as strong towards Georgia as it is now ...
J1 - Sorry. This is exactly what the government and its supporters point out, that "the support of Georgia from the United States is great and why do you exaggerate the fact that the critical mark there is high." How do we separate all this?
Zaza - The United States has been, is and will continue to be a great supporter of Georgia and the Georgian people, and this strategic relationship, although sometimes very high and as it is now, is quite low, but the United States' attitude towards Georgia and the Georgian people will not change. But what is at a record low today and at an undesirable level is the attitude towards the current government of Georgia. This is the government of the Georgian Dream, which has buried relations with the United States in the field of foreign relations. Numerous examples of this can be cited in the last 7-8 years of what has happened.
J1 - Let us give examples.
Zaza - Here, for example, will tell you one interesting fact. Prime Minister Ivanishvili and Prime Minister Gakharia have never been to the United States in their capacity as Prime Minister. Such a thing ...
J1 - Ivanishvili has been prime minister for a very short time. Once he was in Davos I think.
Zaza - Yes, Ivanishvili was in Europe, but if we are talking about a strategic partnership and the biggest donor country that has always helped Georgia, the Prime Minister is obliged to deepen relations, see more opportunities in this country and gain more support for the country, which neither Prime Minister Ivanishvili nor Prime Minister Gakharia did.
J1 - Was there a desire on the part of your partner? Were steps taken to invite him on a visit and Prime Minister Gakharia did not arrive?
Zaza - Of course it was. In Gakharia's case, this was done with less enthusiasm since he was in the United States during his previous tenure, but this visit was not a great success and he still cannot boast of highly effective communication with the United States government.
Translation #29 TVKavkasia with Zaza, 21/08, 34m22s
Pt.1
J1 - International context before the election. The government of Georgia has practically got a stopwatch from the West. Bidzina Ivanishvili is already called the Russian oligarch who is trying to destabilize Georgia. He is accused of undermining democracy. There are certain conditions. What is it like to go to the polls for the government when there is too much observation, attention and criticism from the West. We will talk about it with our first guest, this is the president of "Frontera Resources" Zaza Mamulaishvili. Thank you very much, Mr. Zaza, for participating in the show. Let's talk about the reality where we are and where the Georgian government is. The topic of "Frontera" is one of the main and important ones, due to which the Georgian government has received a lot of reprimands in the last 9 months. "Frontera" has always been an example in the letters sent from the United States that the Georgian government treats American business at least harshly and not only American business. Let’s talk about the last story. Finally, as it was in the summer, it was a congressional appeal to Pompeo saying that progress in the Georgian government has been reversed since the arrival of the Russian oligarch. It was the Defense Authorization Act, which already states that the Secretary of State must submit a report to Congress on the situation in Georgia in terms of human rights and other components of democracy, and only then can any kind of decision be made. What does all this mean before the elections? And, it is probably related to the elections, right? What does such a strong attention from the American side mean for the government 2 months before the elections?
Zaza - Thank you very much. I will be happy to share my opinion on this. Unfortunately, this is the context we have today. There are only a few months left before the elections and the country have not had such a bad relationship with the United States, Georgia's strategic partner, since gaining the freedom from which started the Georgian-American relationship.
J1 - What is meant by a bad relationship? We are not talking about Georgia here, we are probably talking more about the government, right? What does a bad relationship mean? Criticism of democracy has been around at various times. Shevardnadze's time was also criticised for corruption, human rights, and harsh statements towards Saakashvili, sometimes on November 7, about various cases. Now, what is different today under Ivanishvili's government?
Translation #28, short phone interview with Zaza, 1m24s, 10/10
J1 - “Frontera” accuses the Georgian government of misinformation and anti-American behaviour. The letter from the American company says that the Georgian government announced in the media about providing one-time financial aid to the "former employees" of the company, which, according to "Frontera", serves to write pre-election points. "Frontera" states that the government prefers communication with the media instead of direct cooperation with the American company. The letter also talks about the August 2008 war and the investments made during that period. The company says Frontera made the statement in response to a statement made by the economy minister on August 6, in which Natia Turnava said the government would help unemployed citizens. As the president of "Frontera" explains, this statement also meant the employees of the American company.
Zaza - We made this statement because it is just a continuation of the misinformation and false information that the Gakharia's government has been carrying out against our company for a long time. If the government really cared about the fate of the employees and the jobs, then the government would not have spent 42 million GEL to make every effort to terminate the contract with us and leave the people unemployed.
https://formulanews.ge/News/34932
Fund Summary Pt.2
#21 TVKavkasia, PM and others, 3m55s,24/07, POSTED 27/07
https://www.youtube.com/watch?v=VLAJf7zoTeU
#22, 1TV, Kelly Duggan and others, 7m7s, POSTED 28/07
https://1tv.ge/video/fronteras-ganckhadeba-da-politikuri-shefasebebi/
#23 Business Formula with Zaza, 17m46s, 27/07 POSTED 06/08
https://m.facebook.com/FormulaBusiness/videos/388665615448074/?refsrc=http%3A%2F%2Fwww.lse.co.uk%2FShareChat.asp&_rdr
#24 Business Media Georgia with Zaza, 28/07, 8m11s, POSTED 30/07
https://www.youtube.com/watch?v=FYVS1drEQAo&app=desktop
#25, Mtarvia with Zaza, from 12m mark, 29/07, POSTED 31/07
https://www.facebook.com/TvMtavari/videos/????-???????-??????-?????-??????-?????????-????-????????????-??-??????-??????/602501477063475/
#26, TVKavkasia with Zaza, 30/7, 28m35s, US$70 POSTED 03/08
https://www.youtube.com/watch?v=jog4Vzicue8
#27, Formula news with Zaza, 11m10s, 02/08, POSTED 04/08
https://formulanews.ge/News/34512
Total PAID amount = US$1,132.75 / GBP936.70
Fund Summary Pt.1
#1 - radio show $110, PAID, POSTED 07/06
https://www.radiotavisupleba.ge/a/????-????????????-?????????-????????????-??-??????????????-??????/30639322.html
#2 - Short Youtube clip $5.15, PAID, POSTED 15/06
https://www.youtube.com/watch?v=fL97SI8cjzQ
#3 - TV interview 16/06 $41.20,PAID, POSTED 18/06
https://mtavari.tv/ghamis-mtavari/7642
#4 – Interview from early May, $66.95 PAID, POSTED 22/06
https://www.youtube.com/watch?v=0bDj5hEHyEU
#5 – Interview with Zaza & Govt official, 05/06, CANCELLED 29/06 US$87.55
https://palitranews.ge/video/sakme-frontera-vs-sakartvelos-mtavroba
#6 – TV Imedia news 5.23m US$20.60, PAID, POSTED 21/06
https://m.youtube.com/watch?v=84RjV2oahC0
#7 – News segment with GOGC from 17/6, US$55.00, PAID, POSTED 27/06
https://www.imedi.ge/ge/video/54942/saertashoriso-skandalshi-gakhveuli-da-skhvadaskhva-qvekanashi-taglitobashi-mkhilebuli-prontera
#8 – Zaza TV interview, 23/06 from 37m mark, US$36.05, PAID, POSTED 26/06
https://www.facebook.com/107065540663565/videos/????-???????-??????-?????/211402503272921/
#9 – News segment via YouTube, 23/06, 5.30m, US$25.75, PAID, POSTED 24/06
https://www.youtube.com/watch?v=_7KRHadw7oY&feature=youtu.be
#10 Zaza interview TV Kavkasia, 25/06, 26m US$72.10, PAID, POSTED 30/06
https://www.youtube.com/watch?v=Vhio3tzMsqM&app=desktop
#11 Zaza statement, Formulanews, 25/06, 3m30s, US$15.45, PAID, POSTED 28/06
https://formulanews.ge/News/32135
#12 GSAC long version of #11, 25/06, 21m US$66.95, PAID, POSTED 02/07
https://www.facebook.com/GSAC.GE/videos/270839824170062/
#13 Interview about US interests in Georgia, US$40, FREE, POSTED 06/07
https://m.youtube.com/watch?v=0kTGqyOv1SU&list=UUOpMeFzNjG2EQHtJzkJsgVw
#14 Mtavaria with Mullin, Zaza and others, US$ 30, FREE, POSTED 06/07
https://mtavari.tv/news/9192-ivanishvilisa-putinis-sakhipato-kavshirebi-morigi
#15 Forbes TV clip on FRR, 6m30s, 28/06, US$25, (US$10) POSTED 07/07
https://bm.ge/ka/video/fronteras-saqmis-peripetiebi/19240
#16 Mtavari with Zaza, others Time TBC, US$100, PAID, POSTED 13/07
https://www.facebook.com/107065540663565/videos/????-???????-?????????-?????/271993324056247/
#17, Imedi TV, FRR & Sanctions Bill, 12/07, 12m, US$40 POSTED 22/07
https://www.youtube.com/watch?v=HI4IgmD29rw&list=PLMys-CD6bNrJmlrUh8D8n0PDNVYFvOqs6
#18 1TV with Zaza & others, 23/07, 7m9s, US$30, POSTED 25/07
https://1tv.ge/video/ekonomikis-saministros-gadawyvetileba-2/
#19 Rustavi2 TV, Zaza & others, 23/07, 5m59s, US$30, POSTED 26/07
https://rustavi2.ge/ka/news/171022
#20, Mtavari with Zaza, others, 24/07, 4m US20 POSTED 25/07
https://mtavari.tv/news/11360-pronteras-cinaaghmdeg-mtavrobam-4-celshi-42
#23 Pt.7 (and final part)
J1 - Do you have any plans to resume work on that 1%?
Zaza - I think the Prime Minister made a mechanical mistake. 1% remains with the state, we continue to work on 99%.
J1 - Is it clear. Thank you so much for the interesting answers. We will definitely try to voice the positions of the other party on the air as well, as this is a controversial case and we are definitely waiting for the conclusion published by you, which was made by the arbitral tribunal. thank you very much. Zaza Mamulaishvili - President of „Frontera Resources“ was our guest.
Zaza - Thank you.
- https://m.facebook.com/story.php?story_fbid=149072933464878&id=106632844375554
#23 Pt.6
J1 - Did you carry out this work?
Zaza - We conducted 25 times more. We did a $ 560 million job. Whatever commitment we had, we exceeded it 25 times and got an excellent result. By the way, one thing I want to say is very important to the viewer. In Texas or Oklahoma, for example, a company like ours that confirms such supplies and that third party confirms such supplies, the farmers on whose lands are located on these minerals, they get rich very quickly. Although the state does not give us the right and we do not drill many wells now because such an unreliable environment has been created for us to work. Nevertheless, in order for Georgia to legalize the right to minerals to those farmers who own land and work in the Sagarejo and Dedoplistskaro districts, because we will confirm that there is gas and oil, these people will suddenly become rich. Because that land will be interesting not only in terms of agriculture but also in terms of minerals. That's how the whole of Texas got rich, that's how the whole of the United States got rich. And, our half a billion investment has already created this wealth for the people.
J1 - Is it clear. Also, people, since you talked about this topic, I should definitely ask you. There was quite a problematic moment for your employees when they said they could not get paid. How did you handle this issue?
Zaza - By the way, I belong to the group of 70 people who did not receive a salary. I am one of them. And, it happened because for 23 years we were all getting minute-by-minute salaries, bonuses, insurance premiums, and so on. But, after the state completely illegally froze our bank accounts, closed our exports illegally, completely illegally does not pay our VAT debt, which already exceeds 25 million GEL and is fully consciously conducting this disinformation campaign, how should the company pay the Wage arrears in such conditions?
J1 - Do you still not pay the wage arrears?
Zaza - We can not pay even now. Our accounts are frozen. The government is still not fulfilling the condition stipulated in the contract. Even now we have been blocked from exports completely illegally. Even now we are not paid our accumulated VAT.
Is it clear. At the end of our conversation, I should definitely ask you, what are your plans? What are you going to do besides waiting for you to publish an arbitral decision?
J1 - It will take us about a couple of weeks to go through these legal nuances with some stakeholders and then we will be able to make it public if there is consent from the other party, which by the way we are ready for today. We say and call now, live, to meet and make a joint statement about the decision, but we are refused.
#23 Pt.5
J1 - So, you have made some progress.
Zaza - Of course. By the way, this happened for the first time in the history of Georgia, when the gas extracted from the local field has been supplied to Georgian consumers throughout Georgia for about 5 years. And the government opposes this process for unknown reasons.
J1 - The interesting thing is that you have had this problem with all the authorities. It was also constant with the previous government that, say, you said we found gas in the field and the extraction process was hindered. Why do you think this is?
Zaza - No. It was not constant
J1 - From where it all started?
Zaza - It started in 2013. It started to create these problems for us in 2013, in violation of the law and the terms of the contract. We have not had it before.
J1 - There have always been some doubts about what Frontera actually finds in these areas.
Zaza - Do you know what? For example, a week ago, I met one of the authors who published such articles and publicly insulted us, even in the Parliament of Georgia. And it turned out that he did not know what work we had done, did not know what results we had achieved, and so on.
J1 - Here, for example, you should have had your first result in 2007, if I remember correctly, after you took an obligation in 1997. Were specific results submitted?
Zaza - We had not taken such obligation.
J1 - What obligations do you have to the state?
Zaza - In these types of contracts, which last at least 30 years and then last 25 or 30 years (this is the practice in the world), we had an obligation to do at least $ 18.5 million worth of work.
#23 Pt.4
J1 - However, the government says that it is not enough to prove that there is actually a significant amount of gas in the field.
Zaza - I do not know who you mean when you say "the government says" ...
J1 - Ministry of Economy
Zaza - Even the Ministry of Economy. I do not know at the end which competent person looked at that technical data. I do not remember anything to be too much like that, but ...
J1 - To whom did you submit this data?
Zaza - But as it works in the global industry, when a company drills, does testing, puts in results, then goes to a third independent party. This third independent party is the 2 largest American companies in the world that came, checked this data for 1.5-2 years and confirmed to us that there really is an opportunity to extract 350 billion cubic meters of gas.
J1 - And why does the government not allow you then?
Zaza - This is something you should probably ask the government. We have been illegally seized accounts, we have been illegally banned from exporting, we have not been illegally given a drilling permit. Here is an example. When we decided to connect a gas field to a gas distribution network after testing successful gas wells, we were not allowed, illegally and contractually, to build a pipeline until the Senate, Congress, the administration intervened in Washington, and only then did the construction take place.
J1 - So now you have the right to build a gas pipeline and are you going to start?
Zaza - No, wait a minute. When we built this gas pipeline, the government no longer allowed us to pass our own gas into our own-built gas pipeline, until the United States government intervened again in order to make the Georgian government to give us the right to do so.
J1 - So, the gas you extract is supplied to the system? Did I understand correctly?
Zaza - Yes, it is now
J1 - What is the volume?
Zaza - This amounts to several million cubic feet per day. This is a pilot program and one of the parts of the test, which gives additional confidence to everyone that in case of commercial gas extraction, we can successfully supply the Georgian market.
#23 Pt.3
J1 - How much is such an area?
Zaza - It is difficult to calculate this because if we subtract cities, mountains, villages, rivers and reserves, it could be half the area where we work now.
J1 - A statement from the agency said, "We urge you to take advantage of the goodwill shown by the government to continue mining in the following areas: Mirzaani, Tibaani, Patara Shiraki, Baida, Nazarlebi and Mtsare Khevi." So, these are the deposits that you do not return by arbitration. Do you return the rest?
Zaza - We return the rest of the search area. Now here is a very important nuance. Since the government launched the lawsuit against us, the government has spent GEL 42 million on all of this, of which GEL 30 million has been paid to their American lawyers in legal services, and about GEL 12 million of this is from lobbyists, experts, specialists and other lawyers.
J1 - However you also have lobbyists quite influential if we recall the statements of the senators.
Zaza - Before we get there, I will finish this sentence first. 42 million in exchange for spending, practically, the Government has not received anything. Now they want to create something. 99% of something was recovered and do not forget that this is an area where for years it was said that there is no prospect of discovering oil and gas in these areas. They want to justify it now.
J1 - The position of "Frontera" is also very interesting. In fact, since this company appeared in Georgia, the question is - what is this company looking for? And if it searches, why can't it find anything? There was an opinion that all this is happening in order to raise prices on the stock exchange. What is the interest of the company in Georgia? Specifically, is there a realistic hope of finding something?
Zaza - The huge result we have at the moment as a successful drilling, seismic or mining campaign is that we have been confirmed and third independent parties have confirmed our oil and gas reserves. Which means the following: in terms of gas, it is 350 billion cubic meters of gas, extractable reserves, which if we take into account the current consumption of Georgia, which is 2.5 billion a year ...
J1 - And why not start an extraction if it exists?
Zaza - It be enough for for Georgia for 150 years. You will not be able to start extracting gas unless the government gives you the right to drill a gas well. We have had this problem for the last 10 years.
#23 Pt.2
J1 - What is written in the arbitral decision is the most interesting issue. Especially since you are also calling on the government to uphold the arbitral decision, the government on the contrary is urging you to uphold the arbitral decision and publish what you are not doing and the government is not doing. By the way, the latest statement from the agency says that if you do not publish, they will consider the silence as consent and will publish it themselves. What is written in this report?
Zaza - This is a very interesting explanation, legal or contractual, to perceive silence as consent. Such a thing does not happen. How to get silence as a sign of consent is unclear. However, we are not against the publication of this conclusion, but for publication it is necessary to go through several legal formalities. what does this mean? This 152-page report contains a lot of personal information, commercial secrets, technical details that the various parties mentioned in this 152-page document should legally agree with them, and as soon as this period is over within the next few weeks ...
J1 - So you are planning to publish it?
Zaza - Of course.
J1 - Can you at least share some details of what the final conclusion is, because we hear from the government that the state has won the dispute against Frontera, we hear from you that there is no legal basis for termination of the contract. Actually, these are 2 completely opposite statements. What conclusion can we, the community, draw, who are not familiar with this contract?
Zaza - You mentioned the state and the state lost, Georgia lost, Frontera lost, the State Oil and Gas Corporation lost, and the country in general lost because ...
J1 - That’s in terms of investment, though at the contract level who lost?
Zaza - Neither 99 nor 1, nor 60 or 40% is mentioned anywhere in the contract itself. These are fictitious figures, I can not tell you what they are calculating, but the main point is this - the main 14 complaints filed by the Georgian government against us in the Stockholm Arbitration were. The main requirement of these 14 claims was that the contract be terminated for us ostensibly due to a permanent breach of contract terms, which was not upheld by the arbitral tribunal. The second claim, also the most important, was that we were fined about GEL 320 million for our government for allegedly breaching the terms, which was also not upheld by the arbitration. Arbitration did not satisfy 12 out of 14, but did satisfy 2. Now what are these 2 requirements? One is to pay an subsoil fee of about $ 200,000, which we have been paying in advance for 22 years and have no plans to appeal. And secondly, the arbitration ordered us to return the territories where we do not carry out exploration and extraction work to the Ministry of Economy.
Translation #23 Business Formula with Zaza, 17m46s, 27/07
Pt.1
J1 - The American oil company "Frontera" again assesses the steps of the Georgian government as a disinformation campaign. The government's statement, despite the end of the arbitration dispute, not to terminate the contract with "Frontera" and to leave it the right to continue the search for 1% of the transferred deposits, came as a surprise to "Frontera". While the government sees the move as a goodwill gesture, „Frontera“ insists there has never been a legal basis for unilaterally rescinding the agreement. The opposing parties call on each other to uphold the judgment of the arbitral tribunal, although both parties have refrained from publishing it at this stage. Actually, what is written in the verdict? What arguments do both sides have? We wanted both sides to be on the air today, but only Frontera agreed to comment, with the State Oil and Gas Agency declining to comment. Zaza Mamulaishvili, President of "Frontera Resources" joins us. Hello. Thank you so much for your time and for being our guest. First of all, why was it unexpected for you this statement that the Minister of Economy made at the end of last week and said that the contract will not be terminated despite the court ruling and you will be left with the right to continue working at 1% of the area you were given earlier?
Zaza - Thank you so much for this opportunity. The first thing that came as a surprise to us was the statement they made 2 or 3 months ago, stating that it was as if they had to unilaterally terminate the contract for us within 90 days according to the contract or the court decision. Such a thing is not provided for anywhere in the arbitral decision, nor in the contract signed with the state, nor in the law. And, that was the first surprise. And, now it's been exactly 3 months, 90 days since the announcement was made and it was also unexpected when the Prime minister made an announcement a few days ago when they indicated that they were not going to expropriate our activity.
J1 - However, only 1% actually?
Zaza - Now before I answer ... However, as soon as the Prime Minister made this statement publicly and stated in front of the US Ambassador about what kind of government it has and how they welcome American investments, on the very next day the Ministry of Economy sent us an official letter saying the opposite.
J1 - What is written in the letter?
Zaza - The letter says that they decided to do the expropriation on June 27, otherwise this day could come on the 29th, or in August, or in 3 months. So that it is completely unclear what served either the Prime Minister's statement or the letter we received the next day from the Ministry of Economy. But, to sum it up, neither before nor now, they have no right to do so.
#27
In Pt.2, the below section was said by J2 and not by Zaza -
"Zaza - In 2017, the state sued Frontera in international arbitration and demanded the return of the areas where the company was not engaged in exploration and extraction. The dispute ended in 2020. Authorities said shortly after the court ruling that the case had been won by the state and that the decision had grounds for termination of the contract, which was soon followed by the notice of termination of the contract with Frontera by the Oil and Gas Corporation. The arbitral decision is not public, but as the company says, there was no fair basis for terminating the contract."
#27 Pt.4
J2 - Another negative effect that has followed the dispute between Frontera and the state is the reduction of employees in the company. According to the president of the company, it is precisely the current situation that has led to the fact that the employees have not been paid for months. Moreover, they had to reduce a large part of them.
Zaza - After freezing our bank accounts, it simply became impossible under such conditions. Which company in the world would be able to pay its wage obligations under such conditions. And, because of this, we could no longer pay our salaries. So that the state did a very bad job for us and forced us to fire too many people.
J2 - And, still, did the country suffer from Frontera’s activities? The fact is that for 23 years since the signing of the contract, large amounts of capital have flowed into the country, more than half a billion has been invested, people have been employed and the company has been paying taxes. The agreement with Frontera was signed in 1997, when talks began on taking Georgia's western course, laying the groundwork for the country's strategic projects, and Western companies gradually began to enter the country. The fact that Western investment was important to the country and that the potential for oil and gas production in the Tariban Valley was scarce was well understood by the then president. Eduard Shevardnadze arrived in the Taribana Valley to mark the start of the first well drilling by Frontera. With this move, he expressed support for business and industry. And, neither dit it hurt him to say a toast to the start of this project with a glass full of oil.
- https://formulanews.ge/News/34512