Member Info for Moleinahole

Yes progressing nicely in the background. The suppliers will be glad of the work and it will be good in due course for other suppliers be they on the ships or at Barton as work flows down the supply chain.
The gas pricing is always going to be a hard call. The LPG shipping would have made that the case anyway. But piped local to market has to be competetive and the life of the fields would average out anyway. A lower price may actually make some of the other sources of supply less viable in short term. So the market will find a level.
Dundee - ouch on PTAL today. I've created a watch list on your items as I always like to learn. Good example of why not being a producer at the moment is an advantage.

Dunderhead on how LOG were allowed to get such a stranglehold on the business that they nearly destroyed it I think everyone would agree. Once they were shown to be toxic then IOG had a massive problem on their hands.

With hindsight nobody would disagree that LOG should not have been allowed to become such a large source of funds. But were you asking those questions at the time? Nobody was. Until the racket behind it blew up nobody I saw critically questioned who they were. I include myself in that. I wondered who they were but assumed they were a reputable source of funds. Yes they spent a lot of funds which should have been set aside for the drilling on other items leaving the company unable to meet its commitments without a cash injection from the placing.

However, looking back at that period with regret does not help moving forwards. Those mistakes have been made. Has that left a level of distrust? Well of course it has and your persistent reference back to it is a prime example.
Getting funding was always going to be difficult for a small capital company. But that funding is in place now. The return here now is smaller than it would have been. But there is still value here and a path to value realisation.
You can chase value in other shares. There are lots of beat up ftse100 stocks even. But as of today and at this price the 2 year return here still looks attractive and relatively lower risk for AIM.

Dunderhead at the time of the RRE intervention (I agree it was never a real offer - they wanted to get a controlling interest via LOG) it is now pretty clear the company was in advanced discussions with CalE and the administrators were very like in that confidence.
If you were on the board of a company and Berkshire Hathaway knocked on the door with an offer that helped secure the funding package and deal to a great degree with LOG then you would have a hard time explaining that one to shareholders turning it down.
Any such deal could have fallen through and left the shareholders in a far worse position. Then what would you explain to shareholders? At the time of the restructure (before the deal) the company was pretty close to insolvent and without stabilising things then RRE would have been an option - what shareholders would have been paid is moot. Any deal at 20p is clearly too low for the asset by any computation. So on balance I would say the path the board have currently positioned is perhaps not as exciting as some AIM stocks but is balanced and sensible.
Nobody likes dilutions or unjust rewards for the board. But there seem to be stakeholders watching this carefully - hence the noise around the headroom. Large rewards are hardly uncommon in AIM but at the end of the day its likely to be small beer in the grand scheme and will be quickly forgotten once the activity picks up and delivery is achieved of the core project. Failure here now will incur the wrath of adminisrators, institutions and Cale/BH - so I think they will be suitably incentivised whether they have options/shares/salary. I would like to think their ambition is to build this now into a decent sized business.
I look at this investment with considerable relief as the company was very close to going under and was rescued in large part by the existing shareholders and institutions digging deep and some forbearance by the LOG administrators. The time to leave if you had issues was then not now.

No it doesn't make any difference sadly - unless it reveals facts about what is going on. And I'm interested in how the transfer was permitted and then Green farmed in and yet the arbitration still threatens. I need to understand this disconnect between the parties and for that I need to go back to this pivotal event.

I'm currently looking at certified copies of the documents that FTI /Outrider described in their court cases for the transfer and set-up of the US company as well as the key PSA sections. It is of course very similar to the sections produced in the Aim admission document and CPR's we have seen previously but not abridged. Interestingly Maples sent a document for the transfer as well that is in the pack.

The Georgian ones are the ones that will need a bit of looking at to work out - but a Georgian would read them easy enough. You just need to navigate to the company registration and pull the deja vu files out with a converter into a pdf having downloaded.

Those are the sort of documents I trust and place weight on not news reports. And I would expect similar to appear if something happens to the entity be it FTI or the Georgian govt instigated.

Thanks for your snipe at me. Its posts like that which make me inclined not to share information and cease posting.
In 2018 I neglected to independently check what people had said about the US court docs (nothing to see some said and I foolishly did not use my logon to pacer to check myself) - others traded/shorted off the back of downloading them.

I have now converted the docs as I am working at home today on my own equipment so free to do so.

And I am for the first time ever reading excerpts of the actual PSA having converted it into a PDF including the key sections on assignment of the asset which is what I was asking. Its lunch so I can carry on reading the English bits and looking for what I really want to see the GOGC reply - probably in Georgian but we an cross that bridge in due course.

I remain of the view that meddling with companies and cancelling PSA will generate a paper trail some of which can be found.

Indeed.
Few thoughts on that.
1. Current market reduces ability of all but well capitalised to move deals.
2. Minimum share price of an offer based on historic price.
3. Log administrators have a large part to play maybe the longer you leave it hanging the lower the price you might get off them.
4. Cale happy with arrangement and not having to commit capital with eye on other prizes to tie back - playing a more strategic longer game. Use capital for that and if good relations with IOG I don't think we would turn away late offers on Redwell etc to participate beyond core phase.
Just some thoughts.

You can't buy in volume might be the problem. Institutions will want to pick up the LOG shares when they start to offload. Institutions already bought at below this level and will probably sit it out like other long term holders.
So there isn't much of a market.
It's an opportunity for small holders to accumulate if you believe in the project and it's eventual outcome. The request to have authorisation to issue shares whilst prudent is treated with suspicion by those who have seen the drop down to the 10p placing. You then have the collapse in oil price and to a lesser degree gas impacting the sector. There will be other shares that move quicker so this shares has not attracted speculative PI investors. That's how I see it. It's a bit unloved and in a difficult market but I'd rather that than unfunded and relying on a drill result for your futue.

The challenge has been issued! Oddly those are the sort of docs where things turn up unexpectedly and you suddenly find excerpts of the actual PSA! Amazing what information is out on the web. There are supposed to be notarized copies of docs in there and you could see a bundle for the reply on 14th June just before they ruled on the request to change the interest having originally asked for more info. I was hoping there might be a written approval of the transfer given in there with who signed it off on the GOGC side.
Ok thanks for trying.

Some of these fields still produce the odd barrel so while they are producing they are not prolific by any definition. There are Soviet wells all over Georgia and as Block are finding they are of dubious quality.
Frontera however believe under neath this is the much larger reserves in particular the gas hence the read across from Shah Deniz geology. Some of us look back with fondness to the days we looked at geology and not politics or law!

I'd be careful in interpreting developed historically and fields that are active being explored and recently produced!
FRR inherited alot of historic producing fields where they were drilled badly or partially exploited.

I am however interested in my question this afternoon on whether any of the sleuths have ever tried to open the deja vu docs on the company reg site ODR posted.

Free - that info I think came from the Outrider court stuff probably california - I think it in part caused the attorney to get censored by the judge when it was put on the table!

No I'm intrigued by this other stuff people allude to around GOGC. Without something else some people have seen or heard but not shared (and apart from Zaza latest comments) I don't get why you would think a deal involving GOGC had been worked. In fact quite the opposite is what is demonstrated by their public statements. Hence why I've gone back to have a look at that key decision in Apr to june 2019 when FRR were rushing to execute the transfer to keep Outrider off the shares that controlled the PSA and GOGC either helped or hindered that process.

If FRR get out of this - Zaza will be like the Mr Mcawber of corporate litigation.

Also out of interest has anyone read the Dejavu attachments on the request to alter the partner on company 204905674 on the site that ODR posted?

I don't have a viewer installed on the machine I'm on. The request when the transfer was rejected was for more information on the ability to fulfill the contract. If that was provided (and the transfer approved in june) did they scan anything interesting by accident? I ask because somewhere is the source of claims about the prospective deal and I doubt it came from the company. The last 18 months have shown the legal papers to be where you find things out. They may just be scans of the requests but you never know, the files seem a reasonable size so are not blank or just the odd page.

The abridged note on the case file might give a clue as to whats inside:
Giorgi Janiashvili (P / N: 01025015919) submitted: Notarized Statement (Consent), Agreement Amendment N1 (Notarized Translation and Copy), Certificate of Authorized Persons (Notarized Translation and Reproduction), Georgian Oil Letter (notarized translation and copy), excerpts' tsgk' to (a notarized translation), the statement B19044710 / 5 decision by the P / M copy.

I've not been following closely the legal goings on over the past year and assume the blood hounds on here have picked this site to bits already!

But was it and the transfer approved in writing before FRR lost control of its shares in the entity that controlled the PSA!

ODR first link with its date was interesting as that linked into the FIT actions in my opinion - indeed when I plug the CompanyIdentification number: 204905674 you get the request for an extract. Which is the doc you found. There is a name Mariam Chikovani who requested who seems to be a lawyer/accountant in Georgia. Interestingly the company in that register entry is still active. Is that the pass through entity for the company that runs the block?

The bit of information that is totally missing is all around the attempted transfer and who Green were. FTI sought to find out and since then the trail went cold till the arbitration information started to seep out!
It is key to understanding what is going on here and whether we lose to GG, jump out of the frying pan into the Outrider fire or escape from both with something.

The current reality is that no one posting on here can produce the definitive piece f evidence that says what happened in 2019 around a prospective deal and the transfer. That is key to understanding and interpreting the arbitration and the actions of GG last week.

This is political as well as economic. All I can say is that Zaza has continued where he left off in 2018 with an optimistic view in the face of a ferocious onslaught from GG at arbitration and Outrider in the courts. You couldn't make this up if you tried. It's so unusual a set of circumstances. Even FTI didn't know who Green could be but still carried on with their litigation. Outrider renewed interest in the security of shares in Texas shows they might still see some value in them.
So its either the best kept secret or a pretty cruel and prolonged punishment of shareholders.
I retain an open mind as I think this is so unusual that an unexpected outcome can never be ruled out.
As of today we do not know for sure what contract anyone is talking about. But I am suspicious around the PSA as changing that should have generated a paper trail. The only one we saw was the initial refusal. Exactly what Out of court settlement is everyone referring too? Settlement between who and when and what?
It would be nice to know in black and white. In the absence of that we see only a murky grey.
Looking forward with interest to the next promised revelations but remain very concerned that my investment has become a political football and item for interest in the local press for all the wrong reasons as I remain of the view these issues need working through quietly and methodically for the best outcomes for all stakeholders. That does not mean some stakeholders here see that differently.

Apart from the Slide 7 with its caption competition potential - the main slide for me was slide 14 with the gas prices and the commentary on that.

I think being funded for the first phase here at this time puts the company in a strong position for contract negotiation on development items and services but the revenue side as demonstrated by the slide is projecting at the moment a hit in gas pricing and the ever present threat of LPG imports. The quicker economy is restated in future the better but arriving to market with product once it starts to pick up would be good. They may have been lucky with timing here getting the finance before current chaos, develop while its depressed and sell into a recovering market. Low cost production and near to market has to be the key USP here.

Missed the call as one my own business conf call at the time - did anyone join?

If you cut away the noise - the arbitration only needed to show a material breach to give the state the discretion/option to terminate the contract. The exercise of the discretion to do that (rather than sit down and sort it out) is the issue I find inconceivable they would do that without having had some nod from the USA or conversely from Russia or both with Trump in the Whitehouse! We have not seen overt US backing for FRR yet (except from the paid senators) FRR have become remote in the Atlantic Council circles in the past 18 months as they increasingly look a lame duck. The Ukraine Trident Bid was a plan b and that has run into its own trouble.

In terms of Seymores post you have to look at how the PSA is structured for Block 12. Block 12 had and still produced existing discoveries. The PSA has a very long exploration phase designed to find new discoveries. Once proved these areas become Development areas. The old fields were all exploitation areas - and that includes Taribani and Mirzani. Hence the PSA covered the cost recovery rules for each type of area. Any exploration area not declared a development area needed to be ceded in Nov 2017. FRR instead declared a new study for 5 years and were confident they could do so. The FDP for Taribani is of course on an existing exploitation area - they have not really advanced any new exploration areas into development other than a small shallow gas operation in Mtsare. That is the real issue at hand in my opinion. FRR needed to show they had plans and finances to actively explore the block. The company has however not really recovered from the loss of the funding post azer and debts run up with expensive but ultimately fruitless campaigns like Basin edge. That debt has been a millstone round the company ever since - combined with running too fat an organisation for too long burning admin costs with too little going into exploration. To be fair Zaza finally kick started that in 2017 but that was too late for the end of the exploration phase. Too much time had been lost due to the war, 2008 crash and commodity depression to attract funding in scale or a partner. They have also failed to take the CPR to the next level to unlock RBL funding.
So I think we have seen a convergence of threads in 2017/18 where the company needed very good results at UD2 in particular and the Eldari B to navigate out of the press being applied by the state and Outrider. The legacy of Steve's prove it and a major will come strategy has been to leave the company saddled with debt and to date no major.
If your not paying your workers its hard to demonstrate you can fund an exploration campaign when you are delisted and have large liabilities. In that context Zaza needed both Outrider and the State to work with Frontera on the debt and the PSA - but perhaps their patience finally ran out. That's how I see things - the past fascination with exploration over development combined with a bit of bad luck with geology.

Bezzy sadly I think you are clutching at straws. If a major was more advanced for a deal then we would not be in the current situation. That's not to say once we lose it someone won't appear on the acerage.

I think people need to be realistic here . As I posted yesterday what is now happening is my greatest fear around the PSA its a very bad idea to have ended up at the arbitration on thin grounds. If you were prepared to relinquish they should have mediated. Falling out with your stakeholders be they employees, shareholders, regulators or bond holders is seldom a good idea when you are looking for a bit of goodwill. To do it to all is quite exceptional.

It feels a bit like the last moments of Butch Cassidy and the Sundance kid to me. There may be a different ending here but that will require someone riding to the rescue or the reports being totally wrong. I don't see that being a major - not before more proving is done on the gas. Schlumberger exiting was not a good sign - maybe the US are no longer interested? The current climate is a good time to pick assets up for peanuts from distressed and under capitalised companies.

That's easy to answer - assuming it did happen.

Assignment
Frontera Georgia may transfer all or part of its rights and obligations under the Block 12 PSA to a third party provided, firstly, that such third party has the requisite technical and financial ability and accepts the terms of the Block 12 PSA and, secondly, that GOGC has given its prior written consent to such assignment (such consent not to be unreasonably withheld or delayed).

If they didn't they would be in breach of the PSA!

No.

If you terminate the PSA they bankrupt FRR (eject a US entity from Georgia) and get the land back to remarket including 3 newly drilled producing wells.

In addition they wipe out the cost recovery pool.

There are also alot of others provisions in the PSA they would like removed for a new operator.

At the back of my mind here is that they have driven this into the ground to spite Outrider. Either that or as with Outrider they have overplayed their hand and thought they were mediating when it was actually more serious than that - they were litigating to conclusion.
The pattern with both litigation has been the same. Hence why I have consistently said I do not approve of or like that as a management technique. It may be that circumstances dictated that there was no option but in choosing to not bring your shareholders with you when engaged in such high stakes activity was disappointing. There have been moments on the journey where choices have been made by the executives who run the company on shareholders behalf. They increasingly look like poor or risky choices. Given the way the company articles are drafted it's hard to see what shareholders could have done to prevent this. Hence why shareholders like myself who like to take a close interest in the companies they invest in are so frustrated. Short of starting even more litigation for breach of fiduciary duty by the exec at cost in 2018/19 that would have just given more ammunition to the others 2 cases it's hard when they won't engage!

Canny that is my take on where we are at.

If the GG use the arbitration ruling and to be clear it's not public in detail I think they have the discretion of then using that to terminate the contract depending on what it said.
That would be a massive political decision irrespective of the legality. It certainly would not be in the spirit of what the arbitration might have intended. But without the detailed ruling we can't tell whether it is disproportionate or not.
You would think if they took that course they either don't care about the consequences or have already had that conversation with the USA!
The other option as ever is that the truth is somewhere in between.
However, I remain of the view this is best sorted out away from the press by all parties.
But in an election year in Georgia that might be too much for polticians or as with Outrider the animus is such that speaking via the press is where they are at.