Member Info for Moleinahole

Indeed I will vote against IOG board if RRE came back with revised all share offer.

ODR - Steve has been stepping back from AC for a while but more involved with US Chamber of Commerce and Zaza has tended to step into the AC space. I would not read anything into it. The US chamber of commerce is more important commercially but the two seem to have similar strategic views of the Black Sea region and energy. Frontera remain active member of the Chamber of Commerce in Georgia where you often see familiar company faces in the pictures.

Keep the faith folk. I think the Frontera dog is still chasing the car and the golden age has not yet receded.....

HD that is exactly the issue. In my company I get to participate in company share schemes and profit share. Profit share is based on results and share schemes I buy at a small discount to market.

I would have preferred to see employees incentivised by results. It is a takeover in all but name.

The proof will be in the results and given the crop is due quickly I can't see any reason why it could not have been structured accordingly with results rather than participation rewarded.

Given that shareholders have had to endure a torrid 2 years waiting on what was supposed to be the core business this new development tests the patience and resolve of longer term holders and has created an opportunity for shorters and traders.

Time will tell whether the is a smart move or not and what the beneficiaries of the share giveaway plan on doing. I would guess the first thing will be to get their warrants. That will be interesting to see how they fund and behave with those.

OSG I share your irritation on this.

The problem I fear is that these are not on the board. They seem to have created a very generous remuneration scheme for employees or contractors. However, the deal looks closer to a buyout of a business without actually making a formal offer. So these folk appear to be well paid contractors if you didn't know better it looks like some sort of way to save on tax.

I have never felt the need to attend an AGM for this company but will be watching for the next one to attend and ask questions. Anyone attending the sessions on RP visit can you please convey existing shareholder displeasure with the price of the raise and clarify this incentivisation and whether it is unconditional.

Also can questions be asked as to why once again one of our core exploration plays has not been listed in an RNS.

Free the obvious answer is that the combination of the Durham loan and the involvement of the industry partners was actually a credible finance arrangement compared to previous small scale efforts. They may have been hoping that they could force the board to resign by getting the injunction on the security lifted thus opening the sealed resignation letters and take control of matters to progress their own plans (like with another deal with the likes of MND - who do work for GOGC in Georgia). Just my opinion. But shareholders should be under no illusion
here about whose side everyone is on. Its likely that is the type of evidence the discovery would be looking for.

The company have been running on tight finances for several years and that is at the root of the company problems. I was watching Great Expectations on the tv on sunday. A tale of woe if ever there was one but a great observation on life by Charles Dickens!

Mr Micawber view of commerce and life generally responates with what one sees at FRR. First Mr Micawber always believed no matter how dim the situation (he got locked up in debtor prison!) something would come up. Second a paraphrase of his view of commerce.

Annual revenue from oil production $5m and annual expenditure $10m and debt of $40m with $4m interest and no booked assets - result misery.
Annual revenue from oil production $10m and annual expenditure $10m and debt of $40m with $4m interest but booked assets of $400m - result happiness.
Annual revenue from oil production $40m and annual expenditure $10m and debt of $10m with $1m interest but booked assets of $400m or more - unbounded joy.

That is where we are at - Outrider are trying to prevent the company moving from misery to happiness because the only way to repay the debt and retain the asset is to grow the revenue and to do that you need to invest most likely with a jv or farmin partner.

That was the case in December 2018 and is still the case today.

Bugsy the final critical part of the 2017 restructure was of course the imposition of a board member with a veto on funding to represent Outrider.

While they permitted equity raises clearly any substantive non equity investment was nigh on impossible due either to their veto or more likely their secured preferred status with charges on the assets when combined with the solvency (low cash flow and high current liabilities) of the business.

Its important to remember that since the restructure Steve and Zaza both dipped further into their pockets to support the critical fund raise in 2017 along with shareholders that kicked off the fund raises for the UD2 and Taribani campaigns without which the PSA terms would not have been met and the license lost. Zaza then for no other reason I can see than to support the shareprice bought yet again in mid 2018 in the open market at a really perilous time for the company.

Yorkville have made matters considerably difficult over the same period by dumping their preference shares as fast as the limits would allow. Mostly small shareholders absorbed those shares and pitched in with the primary bids. That consumed a lot of potential funds for operations or to pay the impending loan interest. We also lost most of the 2017 drilling year while the various parties involved in the 2017 restructure looked after their own interests - so it was not unreasonable for Outrider to accept interest in kind in 2017. It was that action that meant the 2017 accounts aligned with the known terms on the loans and it was not until the H1 2018 accounts that something odd was visible for the first time around the interest.

Meanwhile some very large vendor debt from 2016/17 remained carried forward to be settled in future (and to this day appears to remain unsettled identity unrevealed). The large industry partners also stayed in the background but started to show their hand just as the show down on the 2018 interest due in June 2018 reached its critical point in sept..

We see Yorkville tried one last attempt to get their money out in sept and an intense shorting attack on the company.

That then takes us to where we are now. An injunction on Outrider enforcing their security over the unpaid interest in place pending appeal on the fiduciary - Outrider having tried to use their own injunction now failed to block funding that would have been lower precedence and could have either paid them off or paid their interest.

The key remains the ability to use some funds from somewhere to remove or accommodate Outrider and the activity in Moldova and Ukraine indicates the company is not dead. We wait on the outcome of that battle. It had to come to a head as it could not continue.

Puddy that is really not how this has transpired. Steve could not stop a private transaction between Outrider and the distressed seller. Magic is 100% correct Outrider have not put 1 cent into the company but instead have bided their time like a constrictor attempting to strangle the life out of the company with their coils becoming tighter with each breath of its victim.

The 2016 restructure left FRR and Steve with no choice. When they refused to roll over the debt and the liquidation of the subsidiary holding the notes was challenged the administrator impounded all our cash. Exploration operations ceased and field operations only continued due to the foresight of issuing equity to the service companies.

With oil prices at lows and investment difficult with the uncertainly of the loan notes and the operations not yet proven the resources they had to come to an out of court settlement to protect the PSA.

At that point the FRR board had a lot of loan notes and much less equity. They could at that point have cut the shareholders adrift and restructured wiping equity holders out. They chose not to do that and aligned themselves with the shareholders giving up their own debt.

Outrider took advantage of that situation to ensure their own debt became secured, humiliated the board by making them presign their own resignation letters and pledge their own shares as security, forced them to convert their equity at a huge discount and lock them in for a year while the other lender Yorkeville was allowed to offload. They then had the temerity to expect shareholders to fund $4m in interest and fund $10m a year of development for the block.

Steve and Zaza have undoubtably made mistakes. In the past running up the debt pre Outrider on exploration without tangible revenue bearing results is the main one. But you really do have to look at some of the challenges involved in getting investment into Georgia post 2008 invasion and the stock market crash.

What Outrider do if perfectly legal but I would see Steve/Zaza/FRR and its shareholders as prey in a cutthroat world. The question is whether Outrider underestimated the capacity of their intended victim to bite back or the difficulty in digesting their victim.

By Q3 2018 the dynamic has changed. Oil price is higher, there is funding available and progress has been made in the field.

Time will tell whether the company with a little help from some friends can pull this snake off the company for it to slither away to find its next victim.

HDave I share some of Nuba's concern. I generally invest in energy companies as that is an industry where I understand and can calibrate risks. I have no knowledge about this industry and find myself bounced as a result of a rushed placing an unwitting passenger in an industry that depending on exactly what they produce I would normally almost certainly not invest in.

It is unfortunate that a second raise via primary bid at the bottom of the share price cycle has occurred. That simply has to stop. The decline into the raise once again leaves questions. The reason for the hasty action may be an opportunity has opened up and this type of business due to inherent regulatory and other risks may be difficult in attracting other funds. That is fair enough. But this is an industry where I know absolutely nothing and have no idea how credible the numbers being thrown around may or may not be. It could be the next great thing. The point is they have committed capital and taken on liabilities and risks outside the core business.

I'm also want to know more about the people behind this and their history. I do want to know more about the warrants (on the face its an opportunity for them to put some skin in the game - but equally if other news lands they could well get them for nothing by selling part to buy the remainder). In particular I want to know what performance permits them to get 12.9m shares in a year. Rather than seeing it as an advantage they are part of a wider group I would have preferred and expect them to be rewarded on the results of the subsidiary they are now responsible for not the wider group performance.

It is incumbent on the board to be clearer now what they are doing with the other assets and how they see the future funding mix. This may well be the next great thing. I simply don't know anything about the hemp industry and I suspect I am not alone.

This is the last time I will ever post on this subject. For the avoidance of doubt to anyone who reads these boards I would be pretty confident the auction oil is not FRR oil. Why? Because went out of my way to confirm this with the company to check for Madpunter last year when people were trying to use the auctions to double guess FRR oil sales.

You can choose to believe me or not but there is no evidence to suggest that is not the case.

FRR are selling oil and increased volume from 2017 but the amounts will only be calculable when we see the next set of accounts (we have never been shown production just $ amounts). The H1 accounts indicated oil sales remained low. H2 will be better but the significance I suspect of the H2 work is as much exploratory than purely commercial.

Whamboy - I am 100% certain the oil sales by auction are not FRR. So don't worry about them. The auction sales are profit oil from producers (like Block Energy) where PSA have up to 50% of production due to GOGC as govt share.

FRR oil is shipped by train to port and sold by FRR. The court papers even confirm that when the port strike delayed sales.

We don't need to worry about that until we have our $400m recovery pool exhausted which is no doubt a factor in SAOG/GOGC when looking at the PSA.

Phil, a common sense post. I think you have indeed highlighted the dilemma FRR have been in since 2016 and most acutely in 2018. I don't think anyone would put cash in just to see it go straight out again to pay Outriders exorbitant interest or Yorkeville preference shares. Hence the company resorted to looking at profit share type arrangements for the operations but hopefully have now finally bitten the bullet and moved on to a bigger funding solution involving the Durham funds and or jv partners.

Its should be no surprise that the Outrider security and their attempts to leverage it to extract cash or force asset sales are an impediment to investment by anyone else and hence the battle for control and direction of the company in the courts.

I had a brief conversation with Levan in Oct at the shareholder meeting. At that time he was still confident on the arbitration. However, you need to be a bit cautious with everything going on as the Georgians do have a track record of revoking licenses. It may transpire that we never hear about it ever again but we are seldom that lucky in the snakes and ladders world of FRR!

The best defence remains progressing the work programs and to do that the company needs to work with their JV partners and if its jv find the funding for their own share. To do that they needed the Outrider injunction removed and more likely the funding veto blunted.

The political lobbying continued into Q4 (although one of the two lobby companies spent nothing in Q4).

So the arbitration is a concern but one that you can see a political and commercial resolution emerge. Ultimately I think the Georgians like us just want to see a bit of activity in the block!

Phil/Dave (Dave nice list) but the elephant in the room even once you get beyond the current litigation remains the arbitration request. That is now looming large on the horizon and is why FRR and Outrider need to resolve their differences quickly either by one side knocking down the other or shaking hands on it as a draw having given each other a good beating after a few rounds in the ring. The real winners if it carries on are the Georgian govt and the lawyers drawing fees.

My own view is that the BH and BP arrangements (be they jv or farm ins) are unavoidably inter linked to BOTH the arbitration and Cayman court case. The Cayman case would enable FRR to bring in their own funding share for a jv with BH. The arbitration should provide stability for longer term funding be it farm ins (BP) or EBRD type loans to commit.

The PSA discussions will entail the work programs, cost recovery pool and test the interpretations of the license extension provisions in particular the study area as a device to protect the integrity of block 12. Above all FRR ability to fund will be central to the PSA obligations and come under the microscope. GOGC/SAOG were well aware of FRR financial plight in 2017 and the possibility of a JV partner just before they began their actions that led to the arbitration request.

It makes perfect sense for FRR to have sought some big friends to bolster their case to retain the block. However, I would be pretty sure that can only happen if a substantially increased work program on undeveloped/underdeveloped fields and full field development on the proven fields is agreed and funding is demonstrable.

This is precisely the point Zaza has been trying to impress on Hope. FRR need to meet the obligations of the PSA to retain the license which must be pivotal to the deals with BH and BP and repaying interest (and loans to YA) at the expense of operations puts at risk the whole license.

So I still see a complex picture here being worked through where to progress funding needs to be completed to resolve the Outrider court case and pay our share of a JV 2019 program. The injunction has cost us 3 months and increased risk around the arbitration let alone risked possible loss of the jv partners (and a nomad and our listing!).

So when considering why they are saying little at the moment I would say they will continue to say little until the news is concrete. They don't need to report now so can go about business much more under the radar (which suits complex problems being resolved and deals/compromises being reached) while they sort out the fundamental problems around Outrider and the license.

I think there is a logical sequence here that starts with resolving the Outrider dispute. Once that is done the rest of the knot can start to be unpicked.

As for Ukraine I would expect we are facilitating as we have no expertise in offshore. BP and Exon however.......

Arsenal I have not changed my views as posted in Dec, Jan and Feb. FRR have and continue to need a substantial injection of cash to both progress the 2019 program, retain the license and displace Outrider. The 2016 debt restructure to me had the clear intention of either diluting shareholders to oblivion (either through fund raises to fund operations or a final debt to equity conversion) or forcing a default after YA had extracted their loan. That the board were forced to convert their debt to equity first merely rubbed salt in the wound.

Path A was to try to use the increased headroom from 2017 to get a result in UD2 and Taribani. For reasons well rehearsed here UD2 came up short and Taribani took longer than anticipated. YA with their pre selling, shorters and traders did immense damage materially reducing the amount of capital raised in 2017/2018 which has finally brought us into conflict with Outrider over the loan interest and their security discouraging investment. Had the company not been running on fumes that would have been less of an issue.

However, its looking increasingly likely that the 2018 program has both demonstrated the gas potential and finally the potential of taribani for oil.

Path B was always refinance either through jv or alternate funding. The alternate funding I would surmise required longer tests to prove in taribani the wells did not silt up, prove the eldari a and b and that a reliable flow could be used as the basis to refinance or for a jv partner. I am willing to believe that this was only possible by prising Outrider out as the security became an obstruction.

The maintenance of the injunction while the funding is being fought over remains at the heart of the matter in hand. I don't like any of this legal goings on as outcomes can be uncertain and I don't like the company teetering on insovency. But speculating is risky as we are behind the news and not privy to all the evidence and argument. This is a titanic struggle for the company. But shareholders are aligned to the board and not Outrider irrespective of the rights and wrongs over the reporting of the loan notes and other related matters that have come to light over the past few months.

The key to me remains the ability to remove Outrider (either as part of the Fiduciary case or by being able to replace them in a back to back transaction). The funding from the NY fund being delayed senior has always been key to unlocking the deadlock. If Outrider did indeed attempt to block the NY funding then round 2 of the case could well be where the real battle is and not round 1 where we got a cameo punch and judy performance by Steve.

All I can say is that throughout this the company have remained pretty confident in their ability to get through this and get there in the end. Its a good thing we are private at the moment as if we were not it would be a terrifying daily spectacle and not in the interests of shareholders

I see that people choose to interpret my post from a couple of days ago as negative.

I would say realistic.

To be clear I currently hold a positive view on the geology and potential deals with either the New York fund and or BP/BH but remain cautious due to the inherent risks in any litigation. And we have both the dispute over the loan default and the arbitration let alone the crazy fiduciary counter claim.

While the injunction remains in place there is a path out of where we find ourselves. We went through a similar period of no real news in 2016/17. That out of court settlement process ran from sept to the following may before all the loose ends with YA and Outrider were thrashed out and the first restructure took place.

But there is little point in trying to double guess outcomes here and that applies equally to those who have been celebrating the current difficult position the company is in.

The root of the problem is a commercial one. And that is where the resolution will emerge. I very much doubt that Zaza and Steve have any intention of letting this go without having exhausted all options.

Any one of the problems they are grabbing with would be difficult but there is a clear interdependence of the problems when you are trying to secure funding to evict a hostile corporate raider but at the same time having the license on which both the existing and future lenders and farm in partners would secure their investment.

So that it is taking time should be no surprise to anyone.

Blueboy - there is not a lot that can be said at the moment. Anything said is analysed and reanalysed and often then results in a general melee and usually personal attacks.Today is actually the fist time I have even looked at this board in over 4 weeks - those who know me know the main reason as to why I'm busy with family but I have also been very busy with my day job on top of it all.

I am best served working with the FSG guys quietly in the background at the moment. I find not reading and not posting helpful during this difficult period as we have yet to see anything concrete that can be discussed further.

Nobody is happy about how events of the past 6 months have played out. But equally I would say nobody (and that includes me) knows for sure how it will progress from here. It remains broadly a binary outcome as it always has been but even within that there are plots and sub plats yet to unfold. The odds look daunting and the obstacles in the way are serious problems to overcome.

I've never been interested in the fiduciary case which was absorbing too much time on here. The constant posting of documents and revelations was more like a wiki leaks campaign against Clinton and became quite destructive. A lot of those documents were past history and looking backwards and do not cover what has happened in Q4 2018 and later.

The 2016 Outrider settlement has inevitably brought us to this difficult point. I think the company needed a bit more time in Q3 2018 but when Outrider would not forbear (and restructure like YA did) the conflict finally broke out into the public view.

The company needs to resolve its differences with Outrider, maintain going concern by paying billls as they fall due and then resolve the arbitration. Unless they can get a farm in funding - to have any chance on the arbitration and servicing even a revised debt requires a significant expansion of the 2019 work program and time is slipping by. Going forwards there is then obviously a huge repair job required in shareholder public relations arena.

But the company really do need to concentrate on resolving the very big ticket items. Equally - I think its safe to assume they are well aware of what people think, feel and are saying.

Nothing has fundamentally changed as far as I'm concerned on the way out from here from what I posted in December or January. In Q4 they need time and an alternative to Outrider to retire the debt and fund the 2019 campaign. If they don't have that then they will run out of road and run out of options.

The gas would be the associated gas with the more important oil from zone 14/15 and 19 in 2018. The report does illustrate how one problem can lead to another.

Frontera remain fighting on 2 broad fronts. Front 1 - the internal feud with Outrider in Grand Cayman part 1: the default notice part 2: the fiduciary. Front 2: The arbitration in Q1 2019. The default notice context depends also to some degree whether you take the view the $2m could not be paid or they chose not to pay. The arbitration has in part got to be about FRR ability to fund ongoing development across the full block.

Pivotal to both is the funding. The historic failure to generate revenue (production volume) but instead run up debt is really at the heart of both disputes. The funding replacement would enable temporary resolution of part 2 of the internal feud and go along way to putting in place a program for 2019 to contribute to resolving the arbitration.

The problem with being private is that it can make the equity funding path more difficult. However, given the amounts needed for the full field development that was never the plan. However, equity does enable short term bills to be paid as they fall due of required.

The current position for shareholders requires sufficient revenue from 2018 campaign to cover short term liabilities as they fall due pending the refinance of the long term debt and then rapid expansion of the operations to substantially increase revenue in 2019.

Hence I'm almost more interested in both short term revenue and/or the alternative funding now the damage has been done with the delist than anything else. The alternative funding is absolutely critical to move forwards. That is the area the company need to start to communicate to show how the company in private hands has a bright future rather than grim ongoing rounds of expensive litigation. I'm well aware of the interrelationship between the fiduciary claims that they were blocked from funding and the ongoing financing but they better have that card in the back pocket else as I have said before they will just run out of road like has happened with the clock on the nomad.

If this really was the only way to unlock the funding conundrum then we are where we are. But its not where we should be and not a place we can linger as the longer we are here both Frontera and Outrider risk losing everything for all of us. So sort the legal stuff and get the company funded so we can start to move on from Mirkwood. That is the decisive leadership I feel we now deserve after the unplanned and very painful setback of this delist. We need the board to take the initiative and come back with a coherent plan of the concrete steps forward from here - sooner rather than later would help peoples levels of stress.

That is what you will find in the secure message.

The ambiguity is whether they will leave the shares unlisted in the SIPP or whether they will fire sell them and then return any proceeds. I trust they will leave them in the SIPP and the sale comment only applies in the event of a future sale of the shares at the holders option!.

AJ Bell - mail - I have a SIPP with them. As Below:

The company has cancelled its admission to trading on AIM with effect from 25 January 2019. To view the announcement in full please copy the link below and paste into your web browser:
https://www.londonstockexchange.com/exchange/news/market-news/market-news-detail/other/13946321.html

ISA holders should note that following cancellation of admission to trading and subsequent delisting of the shares the security is not ISA eligible. ISA holders must transfer the holding out of the ISA within 30 days of cancellation.

SIPP holders should note that unlisted shares are not SIPP eligible. Unlisted shares will be displayed within your portfolio at cost and will not be revalued except where this is required in relation to their holding within a registered pension scheme i.e. benefit crystallisation events, reviews and pension transfers (subject to change). In these circumstances it may prove difficult to value the unlisted shares and, should this be the case, we reserve the right to commission a valuation and charge your SIPP for it.

There may be a limited market or no market at all in the ineligible shares following the cancellation and sales may require the use of specialist market makers. We accept no liability for the illiquidity of the unlisted shares and reserve the right to pass on any charges we incur in their sale.

Big double I'm working like many other people. I am at work till later and then going out on a Burns night. I will check my emails when I get home. There is no need to create a sense of crisis by keep posting a count!

We have been here before and have learnt a lot about what to and what not to do if you engage with Frontera management. If you go about what you are doing in a way that is seen as threatening you will achieve nothing beyond a list of email addresses.

Please just ease off - the company has announced an intention to go private not wind itself up tomorrow.

Back to work I have a day job.

Thank you TSBS for reminding me of that huge positive. Charting is totally meaningless in a private company. You need to get out your fundamental valuation tool kit now and chuck the charts in the bin.