Member Info for Moleinahole

It just so happens the one I'm looking at right now has a letter from April 2015 marked secret and I can see inside that the para 27-2 for a transfer to 3rd party that might well be the Varang farm out approval by GG.
Thats the type of paper trail I'm looking for to substantiate the 2nd hand accounts in press and court. I'd give more credence to court papers and very little to press without back up evidence.

100% sure if you open a deja vu file under that company it has comany seal of FEGL on it going back years. Entity 204905674 Istern is Eastern.

That is the old Frontera Eastern Georgia. It is not Frontera International which is what I was looking for as per the article on batumi news. Of course that company exists is one of our main entities. But it's not Frontera international. Hence why I think it's lazy journalism and dangerous to hang much on it. I don't think there are 2 entities in play Western 1% and eastern old 99%. That would have left a paper trail.
Everything I've seen points to Green having a security interest in the operating assets as part of some loan/investment. If that is the case then I stand by my read of the PSA that material breach gives the State the option to terminate the PSA. Exercise of the option to terminate rather than leave FRR the 1% is political but dressed up as a contract dispute. They spent alot on it with a legal team so I just don't see why you would do that if there was another deal under the table.

Thanks for that Whamboy. I was looking for that this afternoon. Was there another place where a % was previously attributed to Green in the court documents. As I had in my mind 50% for some reason.

So its reading that again very carefully having spent hours looking at company docs I think you need to be careful about Green. In 2018 FRR were looking to fund next well with a production profit share on an operating asset. Green sounds like that they could have borrowed against a production share on a well not a classic farm in of the whole block. Again as an investor I wonder if they fall under 27.2 3rd party of the PSA in that case and needed approval by GG? That should be FRR US executing that transaction. But that would also make Green very unlikely to be a major in my opinion.
Again that does not point to me to a new or revised PSA on part of the block. Hence I would say it was still with Frr US unless Outrider could reverse the transaction. But with some sort of royalty split of production to Outrider 5% and an unknown % to Green (maybe 50%). Knowing FRR finances that makes sense (maybe they paid off YA or other debtors!) but would also explain why finances got even tighter in 2019 if they lost a significant portion of the production revenue the company had when they already struggled to balance books without shareholder cash each year.
That would work for me as I can't believe GG would agree anything with FRR.
Based on that you would not find a change to the PSA as it hasn't changed.

In terms of GG cancelling the contract that would be to the joint operating company that administers the PSA the company that is joint owned by FRR and GOGC in my opinion.

No I think your thinking of the New York fund for the $60m - name escapes me without looking agan. That fell through due to either FRR not paying the fee and/or the Outrider litigation which had an injunction in place which Kawaley in Cayman unhelpfully left in place right up to March 2019 or they just walked away due to the ongoing arbitration question of title/general melee. However, they could indeed have come back.
Hard to tell. There seems to be a further transaction to parties even FTI (Outriders liquidators) do not know who they are or whether they are connected persons. Its hard working this one out as its become very messy and some of what is going on with a private company is hard to prove!

Looed/Phil
I've spent too much time in last 24 hours trying to make sense of all this.
On the transfer:
para 27.2 of PSA talks of transfer to 3rd party but 27.3 to affiliates and contractors. 27.2 would apply to a farm out but 27.3 could apply to FEGL to FRR US. The difference is a 27.2 transfer needs approval by state but a 27.3 only needs to be notified by company.
Back to FIG. I'm a little concerned about loose Journalism and the use of Frontera International. That name goes back a long way as part of the group structure from Bill White days! The article can be interpreted a couple of ways but I'd be concerned to hang too much just on that one sentance - as FRR have always had a joint 50/50 operating company with GOGC and that is the shares FRR tried to transfer. Is it the same or a different company turns on almost a single word.
We know from the Outrider court action FRR transferred to FR US its share. That transfer would be under 27.3 as I would say FRR US is an affiliate. They then set up a foreign registered branch. Then we know again they did a transfer to Green and left a 5% royalty. So last proven data points we have seen is 50% of Block 12 PSA is with GOGC and 25% FRR US and 25% Green with a 5% royalty to Outrider probably from FRR US share.
Depending on who Green was it seems likely it falls under 27.2 of the PSA. So where is it? Where is the paper trail? Mind in spite of looking I have not found documents for the other purported transfers like Varang either!
The set-up of the foreign branch of FRR US looks to have been approved again after some paperwork was provided.
So as of tonight I'm none the wiser who owns what in Block 12.
The Batumi article is interesting in gathering the GOGC position in one place. And it is not in conflict with arbitration outcome. The leap from there to now is material breach resulting in GG cancelling the PSA for block 12 with 3 months notice per PSA.
If there is an out of court agreement of some sort and the 1% is not at risk I'd like to see it and who Green is and what consideration was paid for their share to FRR. But I have to say to date evidence is illusive.
If there is a deal then its beyond disappointing not to inform your stockholders and instead be trading politically charged barbs in the press while we try and work out what has happened. I'll keep poking about but not found a new legal entity yet to pin anything on.

B2O where is that deal recorded? We know from Outrider cases of transfers but not that much detail.
Have you seen documents in public domain say against FIG company records that can be viewed to substantiate that part of the asset has been moved out of reach of both Outrider and or GG?
As I keep reiterating the debate is around what are the sides debating 99 or 100% or 1% of what.
Is FIG a Georgian registered entity if so do you know the company identification number?
What you are describing is FRR having already exited Block 12 having sub divided the 1% of the block on a 50/50 basis like the current PSA with GOGC but then sold their interest. If so then where is the paper trail for this? As a minimum I would expect the new entity to have been registered somewhere.
Thanks for replying but please give us a clue where it could be substantiated.

Exkhoc to answer your question on the PSA.
The PSA always envisaged parts of the territory being handed back within the 25 year term for the block. There are two parts the PSA and the mineral license.
FRR had exclusive rights for that period .
But by 2017 the contract stipulated that they hand back parts of the block where they had not declared commerciality. The disputec is almost certainly a test of whether FRR could keep exploring and not reliquish as they believed they had declared the whole block commercial off the back of the 2017/18 campaigns but only draw up a plan for taribani. Hence they tried to declare a study area.
So I think having handed bits back the existing PSA stands but new sub blocks would be created where in future new punters could try having drawn up their own PSA and been granted the mineral license for that part of the block.

The main part of the PSA is really how you split up the results of production and costs.
So while the contract might have some sort of formal novation to note the change in territory the PSA would stand as apart from that nothing has changed.
If they can cancel the contract the cost recovery pool is lost and in future GG can reapply better terms for themselves.
The arbitration has adjudicated a disagreement on the pSA interpretation between FRR and GOGC. There seem to have been 2 substantive matters the relinquishment and the mineral license. On both FRR appear to have been found at fault. For the GG to then use that without applying any discretion to cancel the contract may well be unjust from our perspective but it is very likely legal.
The only hope is political pressure leading to a revised view or that the contract they are now talking about is for the 99%. But I must admit it sounds like the 100% or some of the unsubstatiated claims B2O and Jrjnr have floated.
I have searched but rather like the hunt for Varang I can't find anything yet. That does not mean it's not there but it's well hidden if it is.
The simpler explanation that FRR have run out of road in terms of license and finance seems more credible. However, that they are still operating of sorts at all at the moment is unusual. There are alot of creditors who sand to lose. We don't know who the large suppliers who were creditors were. I suspect YA have got most of their cash out and it will be interesting if they have been paid off. Outrider stand to lose a large paper gain but they may have an eye on the remaining physical assets to try and recover something. Liquidating the company that held the PSA pre transfer was probably a bad idea unless they were on the line to pick up losses due to the arbitration!
A scan of how Outrider are doing might be interesting. Still think the ultimate irony here would be if we got something back from that litigation if we survive that long.

Looed I've not changed my view of the contract from when I posted the other week.

Frontera should not have gone to arbitration. It all comes down to material breach which is what GOGC were looking for. They needed that to counter the political pressure they knew would come.
That opens the door to allow the state to then terminate the contract as a commercial dispute which they appear to have done. I will be particularly miffed if the part of the contract it turns out to have ruled a breach is the paltry sums on the mineral license which they withheld to try and get the vat back or more likely because they were short of funds.
For that Outrider will have played a critical part.
The reason Zaza is making political appeals is because legally I suspect there is no where to go if the GG choose to use the ruling to cancel the contract. The arbitration does not need to have ruled on that only to have shown material breach.
GG have discretion here on how to use the ruling in my opinion. They have chosen to take a hard line and that is a political decision but if the company really has laid off and not paid the employees then there are good Georgian reasons to take a hard line.
As with Outrider if there was evidence of obstruction etc the time to plead that was before or during the arbitration not after.
Will be interesting to see what happens next but FRR are in a weak position but the political dimension is probably all they have left to get the GG to change their mind.
I doubt they will but you never know here whether there is another facet yet to be revealed.

Forget BLOE.
If there is resources in block 12 and FRR lose it the block itself will be split up.
Bloe would not get all of it as it would be tendered so they will have to bid for it.
Any bits that have stuff in would be competetive. The cheap bits would be like there existing blocks hard and expensive to work.
They should concentrate on raising the funding they will need to pay for what they already have to fund to develop. So they need to be careful chicken counting as they may yet face a whithering dilution unless they can obtain alternative rbl type funding.
They may be in a better place than FRR at the moment but things can change quickly in the world of oil and gas and often when you least expect.

Ekxoc Frontera went to see the president of Georgia in 2016 when Kakadze questioned the reserves. I remember the evening well as we blew up the photos to work out what the documents were.
The problem with the CPR is that prospective resources is not reserves on the balance sheet. If they were we would not be in the situation we are in.
The drilling campaigns to date have provided gainful employment , data and helped YA make money but has left FRR with a mountain of debt and no significant revenue. Hence we find ourself where we are with outrider. In terms of exploration as of today inspire of campaigns in Tariabani, mtsare, basin edge and mirzani the only producing fields are the same ones that were there when FRR got the license.
What needed to happen was the exploration result in P1 reserves.
To date it has not. So on that basis I think one needs to be careful when critiquing the GG.
How much have FRR been blocked is hard to substantiate. However, that has a familiar ring to it as it's the same criticism that is levelled at Outrider and Hope.
The CPR I'd have liked to have seen was one that booked reserves to achievev RBL or attracted an offer. To that it has not materialised.
I also noted your asking what value is in the data. My gut feel is very little. I suspect the well logs revert to state they may already have it as remember the operating company is 50% owned by GOGC.
The US appears not to be commenting on the situation directly. I hope the company really has done a side deal but I have not seen anything tangible yet that objectively supports that. My read of the PSA is that an internal transfer did not need sign off by GG but a farm out would. Having looked in the docs and not found anything Varang related I suspect Green is equally illusive.
I tend to the view the shallower drills are not prolific in Georgia. The Tariabani well spacing has always puzzled me they are so close and the intervals small the geology must be tight or compartmentalised. If there is prolific resource it has to be in the deeper layers where the read across from Shah Denis comes into play. As I say I would not be surprised at anything here due to the unusual politics and we could yet get a surprise. If we do it will be some turnaround.

Pjohn as I have posted already I have tried and continue to try.
Since Q3 2019 I have not been able to elicit any response since then. That is a further reason to be concerned. The company at the moment is not communicating with anyone other it seems than some Georgian journalists. If everything was going fine that would not be the case. The company have reverted to how they used to be but without the minimum requirement of a listing and it seems the norms of a set of published accounts or an AGM per the company articles. But short of us launching a further action in Cayman courts there is not alot can be done.

DD just before I go out!
I doubt it.
The only reason to do that would be to extend the contract beyond 2027 with a new contract. FRR can keep the existing 1% non exploration bit till then.
The arbitration seems to have looked at certain sections of the PSA. The termination clause is in another part and requires a material breach. If not paying the mineral license fee and not returning the exploration areas was ruled a material breach then it opens up the greater risk of termination of the full contract.
If they can terminate the PSA the cost recovery pool is also wiped out and they get it back for nothing.
Moreover, in terms of a farm in by 3rd party that does need approval of GG.
So it may be the transfer of a share to Green that is illegal.
In the absence of simple and clear statements of fact we can't tell. While one can't rule out a surprise new angle here the most logical explanation to me remains that the GG mean what they say. I can't see what a counter suit would be based on either unless they really have agreed in arbitration how to proceed or there really was a previous binding out of court agreement which is what Zaza statements seem to allure too.

Indeed Looed.
There are two dangers here. Firstly, that the arbitration has given the State the option of terminating the contract due to material breach. As I have said I believe that could well be legally correct but I caveat that by saying it could also have been addressed in the arbitration.
Then we have the overt mention of the transfer. It's not impossible that GG cease dealing with Frontera and start with FTI. My read of the real PSA excerpts is that they could not block an internal transfer. However, the risk to the transfer is the mortgage terms and Outrider.
If there was something in the arbitration around solvency or the transfer that would be a prime reason you would not want it published. If you go back to 2017 the GG were commenting FRR did not have the means to develop the block and this was before the arbitration. The declaration of the study area as the exploration expired is what triggered the arbitration.
FRR then trying to withhold mineral license fees as a counter to get the $6m vat back has added a second line to the arbitration. Understandable given FRR finances but probably unwise.
I take the view that FRR remains in serious peril here both from loss of the license and Outrider until I see objective proof that not to be the case.
Off out to enjoy the sun in the garden now.

The current climate will chill others development ambition but might make it easier to bag a license or two!
Don't think today's subsea work would preclude others in future. You would think other connections were more likely once we have switched our bit on?

Tsbs with the dog driving the car into the sunset with Zaza, Hope and the Georgians and their lawyers in the back being chased by a mixed bag of disgruntled employees and shareholders?
Like Benny Hill?

Abkaz I have warned people many times when investing here my Moto.
Frontera not just an investment but an education and an adventure.

FRR respond back in the press then.
Clearly the two parties see the outcome of the arbitration differently. It turns on whether the outcome legally let alone morally allowed them to declare a material breach and take 100% of the PSA area or whether when they are talking they are actually referring to only part.
FRR seem to believe it's part and GG believe it's not and could be all.
Hence the importance of knowing whether material breach was proven or handled in the arbitration or not. Else GG could be legally correct if morally wrong.
If it's part and FRR still have something the Outrider matters can then start to be worked through especially if there really is a deal in the wings be but with a major or another investor. We live to fight again.
Certainly coming to a head.

Yes investing always a learning experience hence why I'm not taking the Mickey I have created a Dunderlist to follow those items. Just when you think something can't go wrong. It can and even well capitalised companies in current climate could struggle. I've been on the wrong side of oil swaps a few years ago on a share that proved costly.
I think we will get over 34p here but wouldn't try and predict when my own rough target is around 50p in time. That depends on a few variables including a clean execution of the project and as we enter a turbulent times you can't get ****y on any share.
As we progress and obviously have not gone down the offtake finance route they will need to strike a deal at some point on the gas pricing. That will be jnteresting.
Then we have the licensing round and other field development outside core. How they fund that will also have a large bearing on shareprice. Then of course we may get so far and be taken over.

CF it's politics and always has been to a degree. The issues here have always been an interplay between the geology, finance and politics. The geology and politics are central here at the moment. As with Outrider judge Kawawley observation that there was an animus in the situation that worked against an out of court settlement which was clearly what he thought should happen on the fiduciary case. That instead escalated into a full confrontation.
You seem to see the same pattern here. So a mix of personal animus with key people in Georgia who don't like some of the press FRR have generated let alone threatening sanctions of the Dream people which FRR will get linked too. They don't like anything which questions the view that Georgia is great for business. That is clearly not entirely true!
Combine that with progressing projects in Moldova and Dolphin in Ukraine then it seems to me that FRR and its management have put themselves right in the firing line let alone their links into Atlantic council and Us chamber of commerce.
That is why they needed to play a cool and straight game. Perhaps we had reached the point where that was not possible.
But I do think Outrider have made a difficult situation almost impossible here.
It would be somewhat ironic if FRR went on to win damages against Outrider but maybe that's part of the plan here to bury FRR and with them the court cases.
Steve in his comments to court on the fiduciary warned Outrider what could happen here. He may be proved right on that.

Chris it's not the same as before.
As I posted the other day material breach is the key. I have seen those who have posted saying don't worry there is more to this. I have not seen any evidence for that. And the contract is clearly the PSA. 100% of the block.
If the arbitration did indeed comment on the transfer legality again without seeing the text it's hard to be sure which transfer to FRR US or the Green farm out. It seems to be the one to FRR US. My read of the PSA is that could not be blocked by GG. However, if they are saying it was illegal then they seem to have joined the arbitration to the Outrider\FIT actions.
That raises the prospect of GG terminating the PSA and the liabilities being on the current owner of the PSA shares which could be the administrators. A liability and not an asset. That would be a small comfort if Outrider lost its Ill gotten gains as well!
I wish I could provide something positive but this can only be resolved by the parties working together be they FRR and Outrider or FRR and GG.
That requires goodwill that is lacking.
Ultimately if the fields geology is poor that will be what has sunk the company. In which case it would not matter what the outcome was as that is what would attract an offer or funding.
I'm still poking around papers which is interesting but does not change the facts on the ground from anything I have seen yet. And before anyone asks yes I have tried again to get a response out of the company and as I said the other week since Q3 2019 they have been totally uncommunicative and my efforts to broke comms either via FSHG or other wider comms has run into a wall of silence. Sorry guys I tried.
Not over yet and we may have more surprises. But as I have said before it is never a good idea to fall out with your key stakeholders no matter what the rights and wrongs. This needs sorting out if it can behind closed doors and away from the press. But they seem miles apart.