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Varang were an unlisted part of an Eastern European business. Hence it left n web footprint.

The only evidence we ever uncovered was the CPR they commissioned for taribani which FRR had also reported by RNS.

No money was ever received and they failed to fulfill their commitments. We do not know from instance if SAOG even approved them.

They left as the commodity price crashed leaving us long term holders to step in with very heaven dillution to pay for a revised program in 2016 to get the declaration of commerciality and fund through the liquidation of the loan its subsidiary.

A cynical view would be it was an attempt by someone to delay Frontera and ensure they defaulted on the loan notes and lost the block. We may never know. But thank God they don't have 50% interest in tarbani now. We do as we paid for the program they defaulted on in 2018.

Yes they obviously have gone for a long run at Dino and T45. They are reasonably far apart in taribani terms.

T39 is pretty close to T45. I seem to remember but obviously zone 14 and 15 are cased in t39. So you would think they are reasonably self contained especially as in separate pressure regimes.

So I think you are probably on the right track with T39 choke sizes and probably shut it in to see what the gas does and then open it up again. Niko is pretty close to t39 so if they go to zone 19 in Niko then they might get some data by monitoring that in December.

Other than that just letting t39 flow for 90 or 120 days like T45 and Dino.

Mcadder do you have a view on what the extra testing or tests might be. I have had some thoughts. But would be interested in some others views.

Puds it's been a pretty good week so far.
If you look at who was posting on Monday Tuesday you can see all the familiar momentum traders. They have largely departed again and the share today stabilised at the point we were at for the July RNS on T39 before the almost incessant negativity stated on here as the company was effectively shorted to where we were on Monday.

It's very likely people don't believe anything. That can only be resolved over time. The fact the share is intermittently the target of shorters and traders makes this painful as a holder to both watch and endure the taunting and gauding we have to endure.

The 2018 oil campaign has been funded and executed very well. The gas campaign I know grieves many on here and that combined with the share price when it is put under pressure by shorters and traders makes this a tough gig!

But I'm with Coggy if taribani is flowing and the companies peekng in see enough in what was achieved at udabano it may change quicker than some realise. History is against us and I the too easy for detractors to reference the past. But it is entirely possible that Steve will be proved to have been right on the Kura basin. If he is it's going to be interesting watching it all unfold. If it's not then Georgia will never enjoy a hydro carbon renaissance like Azerbaijan. But the increased interest in blocks to our north in the basin would indicate others think there is something worth a second look all of a sudden.

Yes that's my understanding and the point I'm making hence if it was my options I'd shift them as quick as possible at the lowest price if I intended to hold at 3.1m long term.

The instruction from what I see was to leave the holding at the 3.1m level at the end of the process in the next year. The largest tranche they have to deal with is at the very end after which you would think some news might have impacted the share price upwards. That last tranche lands right on the cusp of the tax year. So I suspect the trading plan might well be at play here with the next lot due to vest on 25th. They could indeed leave it but it looks a good candidate to me for what I am seeing. JMO

Because post news and tax liability will be higher and more volatile.

I don't post on SOU very often. But with the next instalment of our leaders shares due on 25th and the last lot traded at around the 40p level is the trading scheme he has instigated now causing us to gravitate to this level in relatively thin volume while he sorts out his options?

Dave that was a feature subject of our counter law suite in 2016. Now resolved sadly as a draw with Outrider rolling over to Q4 2020 and the counter suite settled in mediation held at Post Oak Blvd and withdrawn. That whole episode could have ended with us either bankrupt or our debt $35m lower! Allegedly the court papers indicated a 5p a share offer was possibly on the cards even back then.

There are exclusions from these notification requirements relating to impending developments and matters in the course of negotiation, such as acquisitions or disposals. There is also a power for the UKLA to grant a dispensation from these requirements where the disclosure to the public of information might prejudice the company's legitimate interests.

So no. They can. But they have given plenty of hints nonetheless and apart from the final flow they have provided a lot of information already.....

The other part to thread in is the commodity price crash 2015 to 2017 and the war in Georgia in 2008 and the credit crunch 2008 to 2011.

Frontera have been a little unlucky as the challenges of the geology and politics and economics have never quite lined up leaving them post 2011 running an operational deficit due to high general and admin expenses and struggling to fund the exploration.

It has taken a huge effort to fund both the 2016 and 2018 campaigns largely through long term shareholder support and continued support by the board when no one else would invest as they did not believe in the viability of the asset and certainly not when commodity prices were low and quantitative easing made investment elsewhere profitable. Its interesting to see another post on the Georgian government reawakened believe in their own assets!

It is almost incredible that they have done so and retained 100% of the asset. Frontera continued in Georgia when everyone else folded and reduced investment and deserve to succeed.

As someone who has supported the company through considerable part of this period it has gone a very long way into forming my opinion of shorters and traders of the share who have little or no interest in the underlying company or for that matter the real people who work for it.

Dulwich work back in time.

In 2014/15 we were looking for a partner. Outrider introduced us to some of their friends and handed over our research. Would have to get the court papers out for the names but they seemed to have some Eastern Europe/Russian connections. That deal fell apart when someone seemed to accidently copy in FRR on something they should not have done. That resulted in the Varang deal.

Varang failed to come forward with the cash (though it has never been formally RNS'd) - we believe that deal effectively terminated due to them not meeting the spend. That caused FRR to have to fund the 2016 campaign via painfull placings which culminated is the defence against the Outrider attempts to leverage the loan notes to introduce yet another party.

The first mention of the JV was in the Nov 2016 conference call where Steve laid out the strategy (on which I posted yesterday). We then had formal confirmation in RNS for the restructure in Mid 2017 and from SAOG in June 2017. Since then it has been asked but not formally responded at every meeting (including the AGM) until the second formal RNS notification on Monday.

So I think serious talk started in the summer of 2016 and I am guessing is at least in part why Outrider have taken a back seat since jan 2017 and not interfered further.

Timster - Maybe not a major and mabe not what some people may hope for and maybe 2 majors at the moment. What I'm getting at is more that Schlumberger arrived in the adjacent block in 2017 after Frontera started bigging up the gas numbers in 2015/2016 and are part of the wider picture here. The block is big enough with distinct plays and geology to split out. I still think that is what was behind the SAOG comment in 2017 and hence the arbitration - which I suspect will never actually happen as events on the ground over take it (sledgehammer to crack a nut comes to mind).

The area around Gardabani is where the oil and gas pipelines converge so if there is a renaissance of the Georgian oil and Gas industry that area in Block 12 will be close to its centre. So Schlumberger, Frontera plus whoever we end up partnering with ultimately work together particularly on infrastructure when the deeper reserves start to become proven and recoverable. The initial Georgian oil industry going back to Marco Polo was based on shallow fields. The future is in the deep and I think Block 12 is sat tight on top of the best part of the basin.

Timster Schlumberger have taken over operatorship of the block in Georgia adjacent to ours. So not a major but certainly a household name. They are actively drilling into pretty much the same formation we were working at UD2. I definitely think they have to be a candidate in some form in block 12 for the gas in the future. If they strike in volume then the natural way out is the pipeline which runs through Block 12 near the Gardabani power station. Block energy are working the license just to the north of that. So Georgia has 2 active (Schlumberger and Frontera) and 1 pending campaign at the moment. Schlumberger have worked for Frontera in the past and were involved in the Mirzani drilling 10 years ago in the shallow fields partly perhaps where there interest in Georgia came from.

Timster I think the CPR does address Zone 19. But it is on very thin data. The zones below 19 are not addressed in the CPR but I think are discussed in detail in documents I've read (like the strand hansom document). The CPR is also based on very poor data and the drilling programs since 2016 are proving better porosity permeability and size of zones. WHI did not address zone 19 or the gas (or any other parts of block 12 outside taribani). The other thing about the CPR is that it envisaged exploitation by lateral well in a single zone. That is now also clearly not the case and exploitation looks to be multi-zone vertical wells. Also just to be clear Dino and Niko are Frontera drilled wells while T39 and T45 were soviet bores (one deepened and one side tracked no doubt to prove viability of the approach on old wells).

Zone 14 and 15 naturally flow but to enhance it the introduction of higher powered pumps to really open up the formation and then investing in modern proppant has been deployed. The problem in the past has been that because the drilling was not done carefully and used heavy mud weights to suppress the rising pressures as you go down. They have learnt the correct mud types to use and the technique to drill the wells. As a result in the past you could not deploy higher powered pumps as the poor drill and cement just meant the fractures would just go up and around the bore (as has just happened at UD2) and not out into the formation resulting in sands and silts getting back into the well and clogging it up. The other thing they have done in zone 14 and 15 is to perforate a smaller section but go deeper into the surrounding formation.

Zone 19 is very interesting. Not only is the zone twice the size they thought it has better properties and does not need fraccing at all due to the higher pressure and gas driving the oil out.

So as of today we wait to see the flow rates. They will decline but if they didn't open up the choke on the initial test it may well stabilise a lot higher than some people think. Anything over 500bopd across all three wells would leave the company covering all its general and admin costs.

Next news really should be Niko - its only 8 weeks to original drill date. If they intend to drill in November then unless we have covered the short term costs the service providers for the drill will want their up front money soon. If they go deeper then bringing the fraccing fleet back to do zone 9 at T45 and Dino becomes less cost effective. To me you might as well leave zone 9 and concentrate on the deeper eldari b zones and do zone 19 and maybe drill a bit deeper maybe to zone 25 at Niko then you would not need the fraccing fleet back in 2018 at all and rather than interrupt flowing wells just leave then generating revenue.

Guys - this is a marathon or a steeple chase not a sprint.........if your here for the asset. If your trading its always a sprint.

Misterpositive go and visit the website and get the Jan and May 2018 presentations with the models for the taribani field development plan. A limited risked valuation is in the WHI note - but they do not include zone 19 and only looked at taribani oil.

But there are no updated models you will find for the deeper oil. There is no CPR covering the oil below zone 19 and the data even on zones 9 through 19 is being shown to underestimate the resource due to better reservoir properties (permeability and porosity) and size of the zones. Take zone 19 in T39. The actual zone is twice as big as the original CPR estimated.

So in short no - you have to construct a wider model yourself from available information.

For those of us who have listened to the company the position around the jv/transaction has always been:

1. The more proving up and de-risking is done on the asset is done the better position FRR are in when discussing arrangements. The more the debt is reduced and at least break even revenue is achieved the better the position.

2. Deals like this are done at the speed of the partner/partners. They are looking to invest in the asset not Frontera.

For those who do not yet understand this proposition Frontera might seem like a lifestyle company to some but it is not. They are proving up a substantial asset as an explorer. I often post the 2016 conference call notes this is the strategy that is still being followed:

Establish commercial exploitation of Block 12 in 2 paths.
Path 1 Strategic partner to develop plan going forwards and work together advancing.
Path 2 Work program involving own work focussed on Eldari stack and frack completions.

South kaketi oil window: Very large asset, onshore low cost with attractive economics for size of the asset at various commodity prices.

Taribani: Major building block for the company. 2016 work program was encouraging and wells still flowing with long term production of wells good.Dev plan will drill large number of wells (175) and apply frac stimulations.
Field development program to bring into production using model stimulation completions as per USA ( Update: path 2 in progress with the 3 well campaign).

Finance : Debt finance from market (waiting to secure), additional equity offering, may see strategic partnerships.

Shallow fields: Important building block Mirzani 400m oil in place but produced very little. Similar properties to taribani as advance taribani will move and deploy same techniques. Mirzani a very valuable asset with size of resoucres.

Basin edge: Future prospect Exploration program on hold. We will return to basin edge.

Finance: strategic partnership may include working on basin edge. Bring South Kaketi into production and use revenue stream to fund exploration.

South kaketi Gas window: An Anchor asset for the company. 4.5 tcf (3tcf recoverable) in taribani. 8tcf in Mtsare (6tcf recoverable). Mtsare supplying domestic gas. Reason for delays on Gas window attributed to domestic gas monopoly. Hopeful that signing of the energy community will open competition for domestic produced gas and be able to produce more gas. Validate and advance into deeper horizons. "Gas province" of 200tcf+.
Our excitement comes from the size of the resources. (Update: 2017 into 2018 gas development program commenced with UD2. next step is V18 or 3D seismic survey).

Finance: Work with strategic partners to harvest value for shareholders.

But apart from that obvious user error - notice the more organised cancellations seem to have stopped. Strange isn't it.

....as done pretty well in my book and has my support.