Member Info for Madpunter

Posted by Blownitalready on the 23rd January :-

US letter
Congressman Adam Kinzinger says four US Congressman send letter to PM Giorgi Gakharia
Congressman Adam Kinzinger says four US Congressman send letter to PM Giorgi Gakharia
US Congressman Adam Kinzinger says that four US Congressman has sent a letter to Georgia’s Prime Minister Giorgi Gakharia.

“Rep Kinzinger, Gerry Connolly, Rep Eliot Engel and Rep McCaul sent a letter to the Georgian PM with grave concerns over political targeting & a declining economic trend that spells trouble for Georgia’s path towards democratic reform & Western integration,” Adam Kinzinger has tweeted.

https://www.interpressnews.ge/en/article/105462-congressman-adam-kinzinger-says-four-us-congressman-send-letter-to-pm-giorgi-gakharia

Posted by Looed on the 23rd January :-

”Vazha Khidasheli, a corporation adviser, told Business Media.

Georgian article discusses the arbitration in some detail Pt.2
It is noteworthy that Frontera has already expressed its willingness to abandon the $ 3.5 billion demand, but the company is pushing for other demands. The corporation hopes that the verdict will be announced in the first half of 2020.

“The lawsuit of the Oil and Gas Corporation and the State Oil and Gas Agency related to several violations by Frontera. In particular, the breach concerns the non-refund of most of the contract area - 99%. Frontera had this obligation in November 2017, and there are a number of other violations, including the distribution of products, which we have referred to arbitration. When it comes to content, after the arbitration decision, we will provide you with additional information. The disputed amount is not small. I will avoid naming him at this point. There are several alternative requirements, so I will refrain from specific numbers.

At this point, we fully support the lawsuit we have, ”Khidasheli told BEM.

Frontera entered Georgia in 1997. In 1997, the company signed a petroleum exploration and exploration work with the Ministry of Energy of Georgia on the XII License Block in Eastern Georgia.

Frontera's extraction infrastructure is located in the Tariban Valley, in Mareqevi and in the village of Mirzaani (outer Kakheti). The company has several wells at each point. Frontera operates in Georgia through two LLCs through Frontera Western Georgia Ltd and Frontera Resources Georgia.

Source - https://for.ge/view/179277/dava-miliardebze---frontera-da-navTobisa-da-gazis-korporacia-ganaCens-elodebian.html

Posted by Looed on the 23rd Jan :-

I am not sure there is anything new here (maybe the reason for the FRR debt?) here but this piece does seem to pull all the bits and pieces we know / assumed together. -

For the past few years there have been disputes between Frontera and the Oil and Gas Corporation, though almost no one has known. All this has only recently become known and details have just been revealed.
In the summer of 2019, the Georgian Oil and Gas Corporation issued its 2018 audit report, stating that in July 2018 the Georgian Oil and Gas Corporation and the Georgian State Oil and Gas Agency arbitrated a dispute over the financial obligations of Georgia to Frontera. They started. The case was related to breach of the PSA (Revenue Sharing) Articles by the Company. Another clause in the dispute was a debt on the use of natural minerals, which the company was reluctant to pay.
In September 2018, Frontera initiated a back-litigation dispute and demanded the Georgian side to reimburse unacceptable profits. The company is seeking compensation for "unacceptable profits" for 2012-2027, valued at $ 3.5 billion. In January 2019, Frontera was removed from the Alternative Investment Market of the London Stock Exchange. The reason for the dismissal was the resignation of Cairn Financial Advisors, an adviser to Frontera on the stock exchange, and the existence of such advisor was a requirement of the exchange itself. The Company's annual financial statements indicated a significant loss. The total revenue of the company in the six months of 2018 was $ 1 832 407, and the total loss was $ 6 978 138.
Significant is the fact that a dispute between the state and a private company has been made in Washington.
A few days ago, Congressman Marquin Moulin made a statement calling for a fair game for the American investor in the state of Georgia. The Georgian Oil and Gas Corporation says the dispute is currently pending before the arbitral tribunal, and arbitrators in the case have been selected by both parties. “Arbitration proceedings against frontera Resources Georgia corporation were initiated pursuant to the contract and using the dispute settlement mechanisms provided by the contract. Arbitration is conducted in accordance with internationally recognized arbitration rules. The parties established an arbitration tribunal on parity grounds. One member of the arbitration is appointed by the corporation and agency, the other by Frontera Resources Georgia, and the third is selected by them. Thus, arbitration in dispute is objective, impartial and in accordance with international standards. Since the start of the dispute, the Georgian side has refrained from any unnecessary interference with the Company's business. We are awaiting a decision by the arbitral tribunal and will act accordingly. Thus, it is absolutely unnecessary to speak of attempts to prosecute or expropriate a corporation or agency, ”Vazha Khidasheli, a corporation adviser, told Business

The previous post and the post below were posted by Looed on the 23rd January :-

Latest article from Russia Pt.2
It turns out that so. By the way, the company has been operating in this country since the 90s. But Georgia is not the only country in the post-Soviet space where this American company has developed. She is also looking for gas in Ukraine and Moldova. So, perhaps soon we will witness several more reports of mythical gas fields.

Source -https://anna-news.info/gazovoe-blagodenstvie/

Not a great translation - note that in 24 hours we have gone from "gas scam" to "mythical gas fields" -

It turns out that fraud, with which they tried unsuccessfully to fight in Soviet times, is not only very tenacious, but also has an international character. And it can also be extolled as "democratic values ??and economic prosperity." The other day it led to a sharp tone of correspondence between a single American congressman and the Georgian authorities.
It began with the fact that in Tbilisi they doubted that Frontera Georgia Eastern had explored a natural gas field in Georgia, the reserves of which, according to the minimum estimates of American experts, amount to five trillion cubic meters. It was stated that this would be enough not only to cover Georgia’s domestic “blue fuel” needs, but also for export. Among the first potential buyers of Georgian gas was called Ukraine. The importer against the background of the intrigue of the Russian-Ukrainian gas negotiations was indeed promising.
The Frontera statement on five trillion cubic meters was made three years ago. The company promised that it would develop the field over the next five years. And gas prosperity was to come for Georgia. But the company, a subsidiary of the American concern Frontera Resourses, suddenly began to fire its employees. The move is really strange with five trillion cubic meters of gas explored.
By the way, the first to question the availability of such gas reserves in Georgia were not the authorities of this country, but the Turks. The head of the company, Steve Nikandros, assured that after the development of the field, Georgian gas will flow primarily to Turkey. Ankara did not wait for this and concluded an agreement with Gazprom on the construction of the Blue Stream and Turkish Stream gas pipelines. The first of them, supplying Russian gas to the Asian part of Turkey, was an alternative to the "phantom stream" from Georgia. In general, Georgia filed a lawsuit in the Stockholm arbitration ...
This circumstance infuriated American congressman Markwane Mullin, who, in a letter to Georgian Prime Minister George Gakharia, called the lawsuit against Frontera “a deviation from democratic values ??and economic prosperity” by the Georgian authorities. For this, he was called the official lobbyist of the company in the response message of the vice speaker of the Georgian parliament, George Volsky.
We are interested in the motives of fraud over the mythical gas field in this whole story, especially since the background for this was very good then. Recall the events of three years ago. The Ukrainian authorities do not want to hear anything about any cooperation with Russia. The only thing that stopped Kiev from superradical measures was the realization that it was possible to remain without gas. Russia’s relations with Turkey have deteriorated, then restored again. And then Georgian gas. That is, the activities of Frontera in Georgia were originally a bluff?

Posted by ZyDer on the 22nd January :-

Both sides of arbitration
An argument for frr would be
'if we hadn't done all this work then there wouldn't be anything to arbitrate about'
Followed by
We took all the risks

So we deserve something
I. E. At least what we have spent 400m
That would be the absolute minimum imo

Posted by garytrader on the 22nd January :-

I don’t believe that the legal spending by the GOGC should be viewed in the way being suggested.

In any legal battle, you want the best representation you can afford.

But continuing the theme being suggested, if it was a clear breach of the PSA/contract why would they spend $6m on it?

Interesting an offer has been made, a good sign that a compromise may be reached.

Posted by AJamesW on the 22nd January :-

Given that FFR and Block share the same Hydrocarbon kitchen, with FRR having most of it under BK12, Block shares that upwelling to produce a CPR for West Rustavi with a very nice 608 BCF. Our Gas (as LTH in both companies, comes from the same place) This is no geological reason why gas only migrates into XIf (WR) it also migrates into BK12. Having found the stuff in T39 and in WR case, WR38z and 16aZ. The difference is BP want to spend a few billions on the Block and the GG want it all, where as Block is two small to bother with.
Another point is the PSA Block operate to is GOGs 60/40 split on profits after expenses are recovered.
Its about time the GG coughed up what was owed, it take two to tango, and two top make a deal.
Holding for a better future.

Posted by Oopsi on the 22nd January :-

Arbitration
I know there has been some discussion on here and over on iii on the prospects of appealing on arbitral award which I thought it may be helpful to clarify. The starting point is that it depends on the governing law of the contract. I am not aware of what that is on our case. If the governing law clause is English, then the Arbitration Act provides very limited grounds for appeal (jurisdiction, procedural irregularity). Grounds for appealing an arbitral award are far more limited than a normal appeal. Other governing laws may also provide for a similar limited appeals process.

Its also worth bearing in mind that arbitral awards can be in parts - so they can be broken down into the various issues before the arbitral tribunal and decisions made on each of those issues. In effect there could be an overall winner/loser or an award that finds in favour of both parties across the various issues. For what its worth, if Frontera are successful, I don't think the GOGC will appeal. If FRR are unsuccessful, I suspect there will be an appeal (and they have probably already been advised on possible grounds). Why do I say this? Well FRR have already raised issues with the way the arbitration has progressed and the proper parties to the arbitration.

I am not hopeful of a positive outcome out of the arbitration. I become extremely nervous when parties do not participate in preliminary hearings, change lawyers and raise procedural issues which the tribunal effectively ignore. For me, everything is riding on an equitable resolution of the dispute. This will need compromise from both sides (the Georgian government don't want to alienate the US and FRR need traction to raise much needed finance). Let's hope the recent letter is a catalyst for the parties to thrash something out that works for all.

Posted by regdik on the 22nd January :-

So GG have spent over 6Mil on lawyers (best in the land) to fight little old FRR for their block (or most of it). The offer to extend to 2027 which FRR threw out so w are now waiting for Arbitration on a block with no gas (or so they now say).
If I had a strong case I would not offer any concessions however, it seems that FRR did seem to offer a 50/50 deal with the GG. So prior to the final ruling it seems the horse trading continues.
The US letter seems to have rattled a few cages in Georgia and Russia raised the stakes will this push them East or West.
I now doubt that we will be thrown out of all of B12 (why offer a compromise) but the value of years of data gathering (and spending 400Mil) will be a significant factor for the Arbitrators to take into consideration (the NSA report and subsequent drilling results will only strengthen FRR case. Unless FRR have broken their LtO contract then I can’t see a total loss. GG failure to pay their Vat bill will also weaken their hand as would KK outbursts in 2016 about FRR. So its not the first time that they have claimed we have no gas.
All to play for.

Posted by theprodigy on the 22nd January :-

coming towards conclusion
Interesting revelation as highlighted by oopsi that frontera were offered a deal but declined it.

Now thats very comforting for investors /holders of stock, those looking for a positive outcome. Especially when added to all the positives coming to light that have been highlighted previously. Or even the non negatives like the asset not being simply taken back like the port contract was.

But

its far from good news for anyone short on the company.

The word of the year again springs to mind.
UNQUANTIFIABLE
Unquantifiable dread
Unquantifiable stomach churning
Unquantifiable fear
Unquantifiable losses

Where are our resident negativeers, Can they quantify how unquantifiable it all is for the negative side? Pretty please

No green line so Mr ive got a negative slant and negative answer for everything posted has obviously not shown up for work.

Unquantifiable pleasure.

Suppose it could still all be over for us- not that i think that to be the case. Still my losses are known knows ive known and accepted since christmas eve 2018- Quantifiable loss if it materialises. I would hate to be on the other side with Unquantifiable losses. :-))))

Posted by Oopsi on the 22nd January :-

RE: 2020 contributions - Mullin
I should have added that although the amount is small this is money given by Steve/Zaza personally to Mullin it appears in 2020

NOTE: The organization itself did not donate, rather the money came from the organization's individual members or employees or owners, and those individuals' immediate family members. Organizations themselves cannot contribute to candidates and party committees. Totals include subsidiaries and affiliates.

https://www.opensecrets.org/orgs/summary.php?id=D000071040&cycle=2020

The previous post was posted by OneDayRodney1 on the 22nd January.

US Congressman Markin Malin on January 17 addressed an open letter to Georgian Prime Minister Georgy Gakharia, saying that he "is increasingly concerned about Georgia’s continued estrangement from democratic values ??and the deterioration of its economic well-being."

Congressman Mullin, like a letter from his colleagues - co-chairs of the Georgia Support Group in the US Congress, Adam Kinsinger and Gerald Connoll, published in December 2019, expresses concern about the decision of the Georgian government to abandon the promised reform of the electoral system, as well as in connection with reports “on the application of violence against peaceful protesters. "

The congressman stressed that he acknowledges Georgia’s progress that the country has made since regaining independence in 1991, but added that “there is a negative trend in democracy and the free market economy.” According to him, because of this, foreign direct investment in Georgia has declined. Mullin also said that the interests of American and European business companies in Georgia have become targets of harassment and expropriation. He cites the American company Frontera Resources as an example. The congressman also touched on the decision of the Facebook social network to remove pages allegedly associated with the ruling party of Georgia.

Mullin emphasized that for the first time in recent history, Georgia received "a negative and preventive assessment in the US Government Appropriation Document." He also noted that the appropriation acts for 2019 and 2020 “reflected concern about the increasing antagonistic actions of the Georgian authorities against democratic values, free market principles and the interests of American business.”

According to the congressman, in connection with the “negative trend” and the need to change it, concern and calls for consideration of sanctions and other penalties are increasingly increasing. He also spoke about the bill that he introduced in February 2019, which provided for the application of sanctions against the Georgian government if it took action that would violate treaties or obligations with Americans doing business in Georgia.

At the end of the letter, the American congressman expressed the hope that the Georgian government “will stop the aggressive actions against American companies and will respond in the shortest time to the increasing signs of threats to democracy and economic well-being that the Georgian people deserve”.

On December 23, US State Department spokesman Morgan Ortagus called on "the Georgian government to strengthen its commitment to the principles of democracy, personal freedom and the rule of law by creating a politically impartial court system and prosecutors." Earlier, two US congressmen Adam Kinsinger and Gerald Connolly sent a letter to Georgian Prime Minister Georgy Gahariya in which they expressed “growing concern” about the decision of the Georgian government to abandon the promised

Posted by Looed on the 22nd January :-

There is a new article on a Georgian website. It has a pic of the letter from the US Senator - but I can't google translate nor cut & paste. Not sure what the problem is but here is the link in case anyone has more success than me -

https://civil.ge/ru/archives/335223

Posted by Oopsi on the 22nd January :-

2020 contributions - Mullin
https://www.opensecrets.org/orgs/summary.php?id=D000071040&cycle=2020

The post below and the previous five posts were posted on the 22nd and not the 21st January :-

Posted by Looed on the 22nd January :-

For some reason I can't cut & paste this article. If you scroll down you can see a summary of comments from the Ruling party and the Opposition to the letter from the US Senator.

https://civil.ge/archives/335136

Posted by Jiff on the 21st January :-

Link below, on mobile earlier this morning. Similar content, states Frontera turned down an offer at some point. Hopefully a sign that an agreement will be reached between the parties. somewhere between the offer and what Frontera are looking for. which is a positive for me. GLA
https://bm.ge/ka/article/frontera-saqartvelosgan--35-mlrd-is-kompensacias-itxovs---yvelaferi-davis-shesaxeb/47269

Quote: However, a corporation spokesman said the corporation offered Frontera" a settlement, but the company declined the offer.

Posted by Gipps51on the 21st January :-

My thoughts are that a SM or majors have made an offer to FRR and the GOGC. Obviously both parties will know what the offer is. The stumbling block is the PSA. Why should the GOGC do a deal with us beyond 2027 when they can get 100% of the revenue beyond that year.
It does feel like we will reach agreement with the GOGC at some point if it is true that they have made an offer to us which has been rejected atm.

It's close now .

Posted by Looed on the 21st January :-

2nd Part

..........We will provide you with additional information when it comes to content after the arbitration award. The disputed amount is not small. I will avoid naming him at this point. There are several alternative requirements, so I will refrain from specific numbers.

Our lawsuit claims are almost over. In the first half of the year, we expect the arbitral tribunal to finalize its decision.

The Arbitration Tribunal is established by the Plaintiffs themselves, in accordance with UNCITRAL rules. The body designated by the contract is the Hague Permanent Court of Arbitration.

After the corporation and the State Oil and Gas Agency filed their claims, Fronteira responded in their own way. Accordingly, the company has filed fraudulent claims, one of which is related to $ 3.5 billion in compensation.

I will not go into the details, but Frontera itself has raised the issue of asking this issue from David. The process started in 2019, the second half of the year, Frontera. The point is that the parties exchanged their claims, arguments and so on during the arbitration process.

At this point, we fully support the claims we have set.

Since the beginning of the dispute, we have refrained from unilateral action, which would have prevented the company from obtaining oil and gas in its contract territory, "said Vazha Khidasheli.

About Frontera's activities in Georgia:
Frontera came to Georgia in 1997. In 1997, the Company signed a petroleum exploration and exploration work with the Ministry of Energy of Georgia on the XII License Block in Eastern Georgia.

More specifically, Frontera's extractive infrastructure at Tariban Valley

Source-https://bm.ge/ka/article/frontera-stan-iuridiuli-dava-quotnavtobisa-da-gazis-korporaciasquot-74-milioni-ujdeba/47303

Posted by Looed on the 21st January :-

Jiffy - thanks for the info on the link. I found a few articles about FRR on the site but I can't figure out the dates. So this is a the article that is top of the list so I assume is the latest -

By: Shota Tkeshelashvili
Georgian Oil and Gas Corporation is involved in an arbitration dispute with US energy company Frontera. Frontera demands from the state to fulfill the terms of its contract with the state and return 99% of the contracted territory to Georgia. For its part, Frontera puts forward the demands of the state. In September 2018, the company filed for arbitration seeking a $ 3.5 billion compensation from the Georgian Oil and Gas Corporation.
The British-American law firm Hogan Lovells International is defending the interests of the Oil and Gas Corporation in the dispute. The service contract with the company was signed on November 6, 2017 on the basis of a government decree and its total estimated cost is $ 7.4 million. It is one of the most expensive contracts awarded by a state-owned company for legal services. At today's exchange rate, the volume of the contract exceeds GEL 20 million.
According to documents uploaded to the State Procurement Agency system, after the contract was signed in 2017, the actual amount paid to Hogan Lovells International is $ 6,485,594. The payment was made with 28 individual payments. (Purchase code CMR170189525)
Hogan Lovells International itself is a law firm founded in 2010. Headquartered in London and Washington, DC, it is one of the largest law firms in the world today. The company employs 2,800 lawyers. In 2018, the company's revenue from services was $ 2.12 billion.
In addition to the Oil and Gas Corporation, Hogan Lovells International also has a contract with the Roads Department of the Ministry of Infrastructure. The aforementioned acquisition cost 472,000 euros. (Purchase code CMR200002902)

What's going on with Frontera in dispute?

Vazha Khidasheli, an adviser to BMG's Oil and Gas Corporation, said that at this point Frontera had expressed readiness to reject the $ 3.5 billion request, but that the company is making other demands. Arbitration proceedings are pending in The Hague Permanent Court of Arbitration. GOGC hopes that the verdict will be announced in the first half of 2020.
"There is talk of an arbitration dispute between the parties. The arbitration dispute is being conducted at an impartial arbitration tribunal formed by the parties on a parity basis. Accordingly, qualifying an arbitration dispute or attempting prosecution or expropriation is absolutely inappropriate.........

Posted by Looed on the 21st January :-

Part 2
The article also has a link to a US site -Open Secrets - that shows that FRR did pay the US Senator (and others) some lobbying fees in 2020-

https://www.opensecrets.org/orgs/toprecips.php?id=D000071040&cycle=2020

US$3K seems pretty good value to me considering the media the Senator has generated!

If you click on the 'summary' tab you will see the following caveat - NOTE: The organization itself did not donate, rather the money came from the organization's individual members or employees or owners, and those individuals' immediate family members. Organizations themselves cannot contribute to candidates and party committees. Totals include subsidiaries and affiliates.