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I think that based on today's announcements, BEY is no longer relevant to any discussions. LOGP is now a 50/50 bet on the outcome of the international arbitration which they can pursue without upfront or ongoing cost. If they win they'll get to keep 80% of any award for distribution to shareholders.
Must be over for BEY now. LOGP will presumably pass their case over on a no foal no fee basis to the guys who did rockhopper - maybe settle ahead of the case but BEY have nothing. Can't see LG and the others throwing good money after bad....
@NigelHaemoglobin, If the Govt do a deal (now) with LOGP for £30m, they kill any recourse by BEY. The thing is, LOGP's action can be judged on the merits with a reasonable inference (balance of probabilities) on whether the decision was misdirected for political policy goals (answer 'yes') - as a domestic Irish enterprise that route is not open to BEY. BEY is stuck with judicial review which is more or less meaningless - basically did the Department follow all the steps in the procedure -it doesn't matter if it is a good or bad process, if it was applied in a correct manner, if the analysis is good or bad. If the procedure has been followed then it passes judicial review. I'd say BEY know this, that's why LOGP proposed the reverse merger wherein LOGP buy BEY very, very cheaply ......
Judicial review is a very (very) limited assessment of process. It does not consider the merits of the case at all - so for instance setting a bananas fiduciary requirement as in this case would not be considered, or the fact that the guidelines are not-binding or the fact that the original license pre-dates those guidelines, none of that will be considered in judicial review. The only issue will be whether the required procedure was reasonably followed. I don't know all the details of the process, it could be that the original delay might be a breach, or something else, but very little gets overturned on judicial review and I have not seen anyone to date claim that a set was not followed. I expect BROE will reverse merge into LOGP to give them a right to join the proceedings which will consider the merits. I would also expect that Boldy will take a pound of BROE flesh in the process - LOGP would seem to be the better partner to be in by some distance.
So anything that goes to court can never be predicted. LOGP might win or lose, who knows. However, the rockhopper claim is interesting. They claimed €280m and were awarded €190m - note it was not Rockhopper's licence, they simply bought the firm that had been awarded the licence for €29.2m about 12 months before the ban/refusal. The details are very different so there is ZERO read across except that (a) it's the potential rather than monies spent that guides the award and (b) even though the legal firm taking the case for Rockhopper snaffled 20% in fees for themselves (in a no foal, no fee arrangement), the award was backdated to the decision (so Ryan delaying a decision for 2 years has saved millions in the event of a payout). It took six years for the arbitration to reach a decision so interest added about €60m in that instance. Administrations aren't stupid so they will be trying very hard to say the refusal is not linked to policy - it's not very credible but therein lies the rub. However, it also seems that in that case, the details really matter, it's not some kind of judicial review and it's not proof beyond a reasonable doubt - more balance of probabilities. If LOGP are successful and the award was proportionate and the initial claim is 100m dollars, it implies that after fees and then adding interest etc. LOGP would be awarded £56m sterling in 2029..... The legal costs will be enormous and neither side can be confident - seems to me, both sides ought to be seeking an early settlement given the overall context....
BTW all the rockhopper case details can be accessed here https://investmentpolicy.unctad.org/investment-dispute-settlement/cases/800/rockhopper-v-italy
So anything that goes to court can never be predicted. LOGP might win or lose, who knows. However, the rockhopper claim is interesting. They claimed €280m and were awarded €190m - note it was not Rockhopper's licence, they simply bought the firm that had been awarded the licence for €29.2m about 12 months before the ban/refusal. The details are very different so there is ZERO read across except that (a) it's the potential rather than monies spent that guides the award and (b) even though the legal firm taking the case for Rockhopper snaffled 20% in fees for themselves (in a no foal, no fee arrangement), the award was backdated to the decision (so Ryan delaying a decision for 2 years has saved millions in the event of a payout). It took six years for the arbitration to reach a decision so interest added about €60m in that instance. Administrations aren't stupid so they will be trying very hard to say the refusal is not linked to policy - it's not very credible but therein lies the rub. However, it also seems that in that case, the details really matter, it's not some kind of judicial review and it's not proof beyond a reasonable doubt - more balance of probabilities. If LOGP are successful and the award was proportionate and the initial claim is 100m dollars, it implies that after fees and then adding interest etc. LOGP would be awarded £56m sterling in 2029..... The legal costs will be enormous and neither side can be confident - seems to me, both sides ought to be seeking an early settlement given the overall context....
BTW all the rockhopper case details can be accessed here https://investmentpolicy.unctad.org/investment-dispute-settlement/cases/800/rockhopper-v-italy
The Government speaks out of both sides of its mouth, they say they will honour existing licenses but then effectively block them. The SP movements might suggests a refusal is coming but, as I understand it, LG has screwed existing shareholders to such an extent that the existing shares are worth a fraction of a penny? BEY is 1.5p with 1.2bn shares, so say 18m valuation - it's going to borrow 60m (not equity!) and the no. of shares will shoot up by a factor of 10. Even if the Government give the permit to do the next exploratory drill tomorrow, I expect the BEY SP to fall significantly.... Does anyone know how LOGP are funding their share or are they getting a carry until the permit is issued?
If that's the view, it's a pity they don't do something to advance the project.
Shareholders listed on the website with more than 3% have 52% of the stock. LG was cutting them in, so what's the delay having an EGM and pushing it through? They mustn't be able to reach terms? I mean if even the top 4 agreed, they be more or less guaranteed to push it through. Am I missing something?
Battle, the Government gave BEY 2 weeks to come up with a commitment for the development cash and BEY came up with that commitment within the 2 weeks. All that's happening now is some internal company admin (including allocation etc.) but the company can draw down the cash tomorrow if it is needed. The ball is back in the Department's court for some time and they need to now take a decision one way or the other. I assume they are waiting for some big distraction (or a power outage or something) if they are going for a 'yes'.....
Thanks for posting JODO. I get what they're saying - LG went too far. If the other large shareholders participate then they can't vote so the deal might not get through the EGM 'cos all the little guys are being roasted. However, I'm not sure what the alternative is. If the deal is voted down, where else will they secure the funds? No funds, then no licence, then no company....
Anyone able to post the phoenix article? I'm abroad so can't get a copy.
The deal was so unlikely I'm not surprised it's coming with extraordinary terms. No cash guarantee then game over. Giving up most of the company (+ more on drawdown) for cash guarantee is not much better. In economics you are taught that for a thing worth X you should pay up to X-1 for that thing BUT in the real world, at a certain point people will judge a thing to be unfair and throw it in the ditch first. Larry is certainly testing the limits of that ....
Anyone able to post the phoenix article? I'm abroad so can't get a copy.
The deal was so unlikely I'm not surprised it's coming with extraordinary terms. No cash guarantee then game over. Giving up most of the company (+ more on drawdown) for cash guarantee is not much better. In economics you are taught that for a thing worth X you should pay up to X-1 for that thing BUT in the real world, at a certain point people will judge a thing to be unfair and throw it in the ditch first. Larry is certainly testing the limits of that ....
Notionally it's the department, not the minister that takes the decision. Still, I can't see the Department rushing to issue the licence. Goodman will need to get stuck in if this is to progress, else it will just wither on the vine....
Has anyone asked the department what the timeline on a decision is? A what point is the absence of a decision, itself a decision? Looks like we are going to find out....
BEY could try to take a mandamus action against the department - basically it would be asking the high court to order the Department to do their job. Courts don't like doing it but it looks warranted here.... Say 'yes', say 'no' but don't say nothing.
I guess the issue now is whether Ryan will ever allow a permit to be given, or even if the permit is given by the department which is 'independent' (yeah, right) that it won't be bogged down in the courts until it's all moot. I don't think a permit will be given in a useful timeframe - i think it would be the end of Ryan, and while I think he is a total moron, i don't think even he is that stupid. I haven't examined the deal Vevan did, i was wrong - i didn't think BEY would be able to raise money, it cost 90% of the company though as I understand it. I think the country needs BROE to work out in a big way - for all the talk of renewables, Ireland is the 4th most dependent on fossils with about half the EU renewable average of 22% in energy use https://ec.europa.eu/eurostat/en/web/products-eurostat-news/w/DDN-20230119-1 so anyone who thinks we don't need BROE and Corrib and more since is delusional.... sounds like the regular shareholders got done over here...
It would be 'brave' of any politician to greenlight BROE in the current atmosphere (wall to wall COP27 coverage). I can't see it happening. If BEY or LOGP don't meet the conditions in their application, that would be a big help for their decision (save the Government from future lawsuits) but I don't see a permission to do the appraisal drill being given in any circumstances.