Member Info for Looed

I have read other posters who discuss the strong ties between various USA govt bodies - FRR - and Georgia, I think specifically via SN.

Yes agree. From memory the first few articles published on this issue where very negative on FRR - "not produced anything" type of thing whereas the more recent ones seem more measured / neutral.

I forgot to mention that article os from a website called delo dot ua

"Given the above doubtful circumstances related to the competition, on August 2 we started a lawsuit in order to obtain legal defense and oblige the Commission to comply with the rules of the announced competition and related regulations to determine the winner; to disqualify any company that did not provide the competition requirements or properly does not comply with them in accordance with the established procedure for holding the tender, and, accordingly, offer the winner from among the companies that submitted applications on June 12, 201 9 years in accordance with the current rules and regulations regarding the competition for the Dolphin site.

We also make formal complaints to the relevant US government agencies, in particular the US Department of Energy, the US Department of Commerce, the US Department of the Treasury, and the Office of the US Trade Representative, "the statement said.

“Frontera Resources has built its business for more than two decades, using the experience, managerial approaches, know-how and technology gained in Texas, USA, in all its portfolio investments in oil and gas exploration, development and production around the world. Historically “With this approach, significant investments by the company and related operations allowed us to identify and confirm oil and gas reserves exceeding 14 billion barrels of oil and more than 30 trillion cubic feet (850 billion cubic meters) of gas,” the letter said.

The representative of Taylor English Duma LLP recalled that earlier this year Frontera Resources contacted the Interdepartmental Commission for organizing the conclusion and implementation of product distribution agreements with the initiative to hold a public tender for the Dolphin site. The Commission and the Cabinet of Ministers of Ukraine in March this year decided to hold a competition, and on April 12 announced that the deadline for accepting applications for participation in the competition was June 12, the deadline for the Commission to submit a proposal to determine the winner was July 12, and the final decision of the government should be made no later than September 12, 2019.

Another piece discussing FRR suing in relation to the above. Whilst nothing that hasn't already been mentioned this one does share the name of the law firm FRR are using -
The law firm Taylor English Duma LLP, which represents the interests of Frontera Resources Corporation, sent an official letter to the Minister of Energy and Coal Industry of Ukraine Igor Nasalik disagreeing about the results of the international competition for the right to produce hydrocarbons within the Dolphin site under the terms of a production sharing agreement.

In a letter, company spokesman Bryce Linsenmeer formally objected to the procedure that was applied in a public tender for the Dolphin site, located in the northwestern continental shelf of the Black Sea.

According to him, Frontera Resources is a private international oil and gas exploration and production company, which was founded and has been headquartered in the city of Houston (Texas, USA) since 1996.

haha I think you are on to something. The same song also has the following -

I was just guessing at numbers and figures
Pulling your puzzles apart
Questions of science, science and progress
Do not speak as loud as my heart

Maybe Chris Martin is a fellow investor!!

The situation with the PSA competition for Dolphin is not the first reputational failure in the history of our state. The last such competition for the development of offshore oil and gas sites took place in 2006, when the right to develop the Prykerchenska oil and gas site (12.96 thousand km2) was received by Vanco International, a 100 percent subsidiary of Vanco Energy Company (USA). Despite the victory at the selection stage, the company was not able to start drilling, because after a year and a half after approval, it transferred the rights and obligations under the PSA to Vanco Prykerchenska established in August 2007. And then it got a lot of political and bureaucratic problems that ended with the cancellation of the license in 2008. Further, the Arbitration Institute of the Stockholm Chamber of Commerce approved a settlement agreement between Ukraine and Vanco Prykerchenska at the end of December 2012. In January 2013, an energy holding of Rinat Akhmetov DTEK bought Vanco Ukraine (British Virgin Islands), and the Cabinet of Ministers cancelled the order to terminate the production-sharing agreement with the company Vanco International Limited in February of the same year. And then the territory of the Prykerchenska oil and gas area got under the actual control of the Russian Federation.
Anyway, “the struggle continues”, and it means we’re “standing” and following further steps of the stakeholders. As they say, no one said it would be easy.

Posted today on opinionua dot com

The founder of Trident Acquisitions Ilya Ponomarev has already stated that in case of the cancellation of the competition, he will have to sue the Ukrainian government. Thus, the development of this site may be postponed for two to three years. As an alternative to litigation, he proposed to involve a large international company (major) in the development of the Dolphin site with the mechanism that will suit the government. Note that “majors” are transnational vertically integrated corporations such as Shell, Chevron, Exxon Mobil, BP, etc.
Thus, we are now in a situation of “war of all against all”. In any case, there will be lawsuits and uncertainty. In addition, we should not forget about the position of Naftogaz Ukraine, which also prepares claims to the Cabinet in case the competition is recognized as valid. Let’s recall that Ukrgasvydobuvannia had its own plans for the production of hydrocarbons on the shelf. (Read more in the articles “Will Odesa become the new centre of gas production in Ukraine?” and “Ukraine’s at the early start of hydrocarbon production in the Black Sea”).
It should be noted that holding a new competition with other application deadlines, extended to up to six months, does not guarantee that large oil and gas companies will enter Ukraine. The Black Sea is now in the state of very unfavourable market conditions and low demand for the development of new sites. Shell, which develops its block in the Khan Kubrat area off the coast of Bulgaria, has not received commercially attractive production rates of hydrocarbons after drill wells, and Exxon Mobil, along with OMV Petrom, is developing a Neptun Deep block off the coast of Romania, invested $700 million, but on Friday, August 2, it announced its intention to withdraw from the project and sell its shares to everyone who is interested. And it is worth noting that no one is interested yet. Thus, the “majors” bear only losses in the Black Sea, which does not add arguments “for” to the potential large investors in the Ukrainian projects.

In accordance with the requirements of the PSA law and the relevant resolution of the CMU, the Inter-Departmental Commission was to prepare and submit the conclusions and proposals on determining the winner of the competition to the government no later than July 13, 2019. But that didn’t happen.
Before the announcement of the winner of the competitive selection, which took place not on July 12, as expected, but on July 26 (with violation of the deadline), the chairman of the Inter-Departmental Commission, the Minister of Energy of Ukraine Ihor Nasalyk said that Caspian Drilling International (which was considered the favourite of the competition) withdrew its application – according to the minister, probably because of the pressure from Russia. Although the company wrote in its press release about the violation of the order of the competition, which makes it legally vulnerable in case of appealing the results by other participants. Thus, Caspian Drilling International stopped participating in the competition. It should be noted that during the entire selection period, the company Caspian Drilling International was under constant information pressure (details of the discrediting information campaign can be found on the link), which also did not add the desire of Azerbaijanis to invest in the development of the Ukrainian shelf.
Later, Ihor Nasalyk said that the application from the American Trident Black Sea was the best from both financial and political point of view. Therefore, the question of its victory was put to the vote. Six out of eight members of the Commission voted for Trident. A representative of the Ministry of Economic Development and a deputy Nataliia Katser-Buchkovska refrained.
The company Frontera Resources (the USA, headquartered in Houston, Texas) as the initiator and a participant of the competition announced the preparation of the claim to the Inter-Departmental Commission. “In case the PSA competition for the Dolphin site is not canceled, Frontera Resources reserves the right to apply to the court. In our opinion, the process of preparation of the competition and its holding is at odds with international practice,” said Mr. Mamulaishvili, the president and founder of Frontera Resources.
On July 27, the acting Prime Minister Volodymyr Groysman said that he would support the organization of new competition because he believes that the proposals of the participating companies were not profitable enough for Ukraine. On July 28, his position was supported by the head of the NSDC Mr. Danyliuk, calling this competition “a benchmark of whether Ukraine is ready to move away from the ‘contractual’ distribution of deposits”. The Minister of Finance of Ukraine Mrs. Markarova said that “it is important that the PSA process in Ukraine is not discredited, but there is more question around the Dolphin than answers”. Thus, it can be argued that despite the decision of the Inter-Departmental Commission, the competition may not take place.

On Friday, July 26, 2019, the Inter-Departmental Commission for the organization of conclusion and implementation of production-sharing agreements (PSA) supported the application of the company Trident Black Sea”by a majority vote and would recommend the government to recognize it as the winner in the competition for the development of the Dolphin area on the Black Sea shelf. Despite the formal recognition of the victory of Trident, the government expressed its desire to announce a new competition, because they believed that the proposal of the winner was not profitable enough for Ukraine. The company Trident Black Sea headed by an ex-deputy of the State Duma of the Russian Federation (2007-2016) has already stated: if the results of the competition are canceled, it is ready to defend its interests in court. Their competitors are, on the contrary, ready to go to court if the competition is recognized as valid. The government is in a difficult situation, the involved companies are as well, and such variability and uncertainty also harm the reputation of the country as a whole. Read the Opinion’s analysis of the first PSA competition for the development of oil and gas fields on the Black Sea shelf since 2006.

What did the companies fight for and how was the competition held?

The total area of the sea sector is 9,496 sq. m. According to one of the participants of the competition, it includes a total of geological resources that equals to 286 billion cubic meters, that is, about 40-50 billion cubic meters of gas, which theoretically can be extracted. That is, in case of successful implementation of the project and discovery of deposits, Ukraine can increase gas production by 10-15% in 5 years, and even more according to some other estimates. The minimum amount of investments to be made during the first stage of exploration is determined by the results of the competition and should not be less than 1.5 billion UAH. The winner of the competition would receive the right to conclude PSA on the Dolphin area for a period of 50 years with the possibility of extension in accordance with the Law of Ukraine “On production-sharing agreements” (more details can be found in the article “Dolphin and Blue Eternity”).

Despite the short deadline of application – namely two months from the announcement date, the Inter-Departmental Commission established for the selection of candidates received 4 applications:

– Caspian Drilling International Ltd (a subsidiary of SOCAR, Azerbaijan);

– Frontera Resources (USA), the company initiating the competition;

– Trident Black Sea (90% owned by Trident Acquisitions Corp, USA, 10% – by San Leon Energy PLC, Ireland). Ilya Ponomarev, an ex-deputy of the Russian State Duma, is a key shareholder of Trident Acquisitions Corp; 10% of shares are owned by a businessman Hennadiy Butkevych;

– PJSC Ukrnaftoburinnia (Ukraine), one of the largest private gas companies.

Thanks again, Pophead. Good advice.

Thanks Pophead. I totally get why some are suspicious about 1st time posters. I was just amazed I had seemingly beaten the super-sleuths to a new albeit tiny piece of the puzzle. I also know some don't like / want to see anything negative. Personally I prefer as much info as possible so we can try to figure out what is going on. See, no bites from me :)

I am very positive about FRR. I have already said I am a LTH

The negative comments are in the article, and similar comments have been made in earlier articles relating to this matter. At no point have I said I agree with these comments, but it is a piece that mentions FRR.

Agreed Seingred, that also makes sense.

So FRR may have successfully halted the Ukraine tender and could presumably come up with the required US$55.5m - not too shabby for a company that " is yet to follow through on plans to launch commercial production"

By the way the article was on a site called intellinews dot com. Not come across it before so not sure how reliable the site is.

Correct - i am a LTH and not a shorter.

As you can see hardly glowing about FRR, but also why would they reconsider if FRR had no clout?

The mystery / mysteries continue!

Besides Trident, the Dolphin contest also attracted bids from Ukrnaftoburinnya, one of Ukraine’s largest private gas producers, and Frontera Resources, a small Texas-based company focused on Georgia and Moldova. Caspian Drilling, a unit of Azerbaijan’s SOCAR also filed an offer but later withdrew it – a decision Ukrainian energy minister Igor Nasalik has claimed was because of pressure on Azerbaijan by Russia.

The offer from Frontera, which had requested the PSA contest, drew particular concern, not least because of the company’s less than stellar operating record in Georgia. It has held rights to gas assets in the west of the country for more than two decades. But despite claiming to have found several trillion cubic metres of gas, it is yet to follow through on plans to launch commercial production.

Frontera entered a 50-year deal to search for oil and gas in southern Moldova in 2017, pledging to invest $500mn, but has not reported conducting any activity in the country since then.

Ponomarev has responded to Groysman’s indication that the award will be rescinded by suggesting that Trident seek out a large international company as partner for the Dolphin area.

He has also made lofty claims about the project’s potential, suggesting it could unlock $1bn in foreign investment. Under the terms of the Dolphin PSA, however, its chosen operator will be required to spend only UAH1.5bn ($55.5mn) during an initial exploration phase, which will involve the completion of at least five wells.

In an August 1 statement on Facebook, Ponomarev went on to say that Dolphin’s development could lead to an increase in Ukrainian gas production by 10-15%, citing its 40-50bn cubic metres of potentially recoverable gas resources. But the area does not contain any proven commercial gas fields, making its value difficult to gauge until drilling has been undertaken.

A final decision on the contract award will be taken by Ukraine’s cabinet.

Hi All,

Long term holder / sufferer here but never posted until now. Just came across this article which seems an update to the previous news about the Ukraine tender -
London-traded oil company Trident Resources recently won a contest for exploration rights to more than 9,500 square km of acreage in the Black Sea, although the government has suggested it may cancel the award.

Authorities in Kyiv launched a tender in April offering a 50-year production-sharing agreement (PSA) to the Dolphin area spanning the northwest of Ukraine’s Black Sea shelf. A government energy commission voted in favour on July 26 of awarding the contract to Trident – a company founded and led by former Russian opposition politician Ilya Ponomarev.

“It was a difficult struggle, but our application was significantly more profitable for Ukraine,” Ponomarev, who was granted Ukrainian citizenship earlier this year, wrote on his Facebook page on July 26 confirming the win. “We promise not to let you down and to do everything possible to start production as soon as possible.”

The deal is controversial and while some have hyper it, saying it will attract as much as $1bn in investment, other commentators believe it will attract no more than $50mn.

Ponomarev is a controversial figure. A child prodigy who started his career at the Institute for Nuclear Safety of the Russian academy of sciences at the age of 14, he went on to become an executive at Yukos oil company and then a Russian Duma deputy. He was the only Russian MP to vote against a decision to annex the Crimea in 2014. However, he fled Russia after getting caught up in a corruption scandal when it transpired he was paid hundreds of thousands of dollars by the state controlled innovation fund of the Skolkovo Fund for a series of lectures that reportedly he never gave. He left Russia after the Russian Investigative Committee opened a criminal investigation into the case and has been a vocal critic of the Kremlin while in self-imposed exile.

Ukrainian PM Volodymyr Groysman suggested on July 27 the government might repeat the tender, however, as it failed to attract any major international oil companies.

“When we announced this competition, we counted on the participation of world leaders of the likes of Shell and Exxon,” Groysman said in a Facebook statement. He said results indicated the competition “was not competitive enough and generally did not live up to expectations regarding the arrival to our market of players from the world’s top league of gas producers.”

Groysman’s concerns echo those previously voiced by Ukraine’s gas lobby group, the Association of Gas Producers (AGPU). That APGU’s head Roman Opimakh revealed to NewsBase, a bne IntelliNews company, in June that the association had asked the government to delay the tender to “allow increased competition and bring international players with proper competencies to Ukraine.”

Besides Trident, the Dolphin contest also attracted bids from Uk