Member Info for MontiBurns

Looed- thanks for your input, which is always useful and thought provoking.

At this point, we can only assume that the the reason for the long period without any news is due to awaiting decision on the extension request for the PSA. Sure, the wheels of bureaucracy move slowly particularly in that part of the world, but how long will the Court, Creditors and Deloitte wait before chucking in the towel, especially when there is no cash? Added to this is the enactment of the Foreign Influence Bill which was officially rebuked by the US State Dept yesterday (I posted the link in my last post). Perhaps this is also hindering the decision process.

All in all, we could do with a small informal, unofficial update, so may be time to release some sniffer-dogs.

Https://www.youtube.com/watch?v=s3rbvFAiFBQ

Pyrotech, the Liquidators are following a prescribed legal process in order to recover as much money as possible for the benefit of all stakeholders but foremost for creditors. Whatever the final result, this will still need to be signed off by the Cayman Islands Court. However you raise a good point that if the PSA is renewed, then what value to ascribe to this asset and who would want it, remembering that the Georgians will have to approve the new operator./owner (which in itself is a arduous process)? This is why I think, it will be difficult to market this. You will also recall from the first creditors meeting that SN agreed to stump some cash to help with the liquidation process but this was being withheld until there is some news on the renewal of the PSA request. The other things which are hugely depended on the PSA are the creditors repayment plan and accessing the funded facility. So to answer your question, no PSA, no recovery for us or any body else; we are at this important juncture now so fingers crossed for good news from Georgia.

Pyrotech - there is no block as the PSA has lapsed and returned to the Georgian authorities, so no value and therefore no option to market it for sale. Infact, you could argue, that the Georgians have held/managed the block for a number of years. The hope was that production at the Taribani was still ongoing and FRR’s share of oil sales used to pay down Arbitration costs, but I don’t think that is the case as amount owed to them is unchanged around $5m. The wells are probably shut-in. The other question I have is on the Mirzaani oil field, which was producing stable oil of around 180bpd. Was this field returned to the Georgian too? And then you have the MK gas field, which included the testing on the Udabno gas well. Whatever the case, this is all academic until the PSA is renewed and until then, there is no value in FRC.

On the US, global sentiment is low as far as trust and ethics is concerned. On the other side, the US itself has retracted to its own boundaries and seems less concerned about global affairs as it once did via the neocons. Unfortunately, the future looks dim when you consider who will be setting the moral standards to the work with Trump who is a proven liar and a cheater and Biden, who has a memory of a goldfish. Yes it’s true, harsh but fair.

Given the disintegration of US leadership in world affairs today (started with Trump’s MAGA rhetoric followed up with Biden’s senile approach), it’s no surprise that China is seemingly filling this leadership vacuum. Anti-US sentiment may have also spiked because of recent events like the US siding with Ukraine and weaponizing Israel leading to the slaughter of the innocent. But to be fair, there are lots of Americans at grassroot level that are opposing US/Biden’s global policies, particularly towards the Middle East, spearheaded by the young.

But I if true d to look in to the future, the US is not going to break-free from this continued self-destruction when it comes to international influence over the next four years given the choice of the 2 Presidential Candidates. However, and at the same time, there are now many countries that are now openly against the established US, UK, France, Germany, with only the US vetoing the UN resolution of granting more rights to the Palestinians from the G7 group, with UK, France and Germany abstaining.

As far as Georgia is concerned, China considers this small but strategically located country important and is part of their one-road, one-belt initiative. And we know that China is closely aligned to Russia and hence we see this tug-of-war (East v West) play outin Georgia. People on the ground are more aligned to the EU while the political elite want to side with Russia, hence this new proposed foreign policies bill which has caused so much indignation. Obviously that puts FRR in a tough position because the political leverage it had via the US has been significantly neutralized.

My thoughts exactly Looed. The fact that FRC has no money or assets, and Liquidators are not in the business of losing money, our company would have been hastily wound up by now. So, the longer it takes Deloitte to make an announcement, this can only be construed as positive imho.

So, what’s holding things up? For me, it’s down to the renewal of the PSA. People will recall that Deloitte had made an official request to extend the PSA to the Georgian Govt around middle of March given it was expiring by March-end. That is shy of two months, and we have some experience on how slow Govt bureaucracy works in part of the world. On top of that, there is unrest in the country, opposing new legislation concerning ‘foreign policies’. This could be another factor for a slow response. However, if the PSA I renewed, I think this will trigger the availability of the funding facility, which could be used to start a new drilling program and in turn use cash flows to repay creditors. But the question is will GG accept a repayment plan based on a new drilling program or want its $5.6m tribunal costs upfront?

Our man is sitting on the Liquidation Committee so will know what is happening with the renewal o the PSA and may direct different parties for a favorable outcome. All ifs and buts right now.

Thanks cymro, interesting snippet. So, the Block can return to FRR under certain conditions. So, what could these be? Let me guess: 1) Repay the Tribunal Costs (at c.$5.6m); 2) Show a fully funded drilling program and 3) Insolvency cleared. On the finance facility, this may be conditional on the renewed PSA and a company with no event of default or any pending legal cases. But so many intricacies and inter-dependencies. Who knows whether SN is going to be able to get this through in what appears to be like an ‘eye of the needle’?

Finally, the mask slipped a bit there with Bidzina and it lays bear the political obstacles put forth to foreign companies and investments but particularly from the US.

Georgia and Ukraine never invited Russian invasion/aggression so not sure what he is barking about. There is a complete detachment between the Political elite and the common Georgian, which I can’t see being resolved in the short term. So, there goes Georgias EU aspiration. Also explains the vigor the GG perused FRR at the Arbitration Tribunal probably thinking CIA involvement, although FRR were not completely blameless.

Thanks for sharing, interesting read.

No issues there tsbs but I do think this could be an important and valuable asset given the unfolding geopolitical situation in Europe as well as easy and cheap access to energy. Also this PSA was granted for 50-yrs so has plenty of legs. Equally, you could argue why would any oil Major consider investing in these Russian-sympathetic countries although outwardly projecting to be West-leaning. But you are right, perhaps Moldova is no more than an academic after-thought.

For those that have not seen the CR, it did state in there that a request was made to the GG to extend the PSA date which was expiring towards the end of March. If this has not been extended (for whatever reason), then there is no asset and this whole discussion becomes ‘moot’. Having said that, you could argue that the GG are notoriously slow and to oversea this situation, our main man was also elected/selected on to the Liquidation Committee. Let’s hope he can still pull some US Political strings to give the GG a good hard prodding to expedite. Now, the PSA is renewed, perhaps (and emphasis on perhaps), this will trigger a number of important events like: 1) the finance facility becoming available, 2) approval of a payment plan for the creditors and 3) some money for Deloitte to continue the liquidation process and to to reverse FRC’s current insolvent status. As far as Moldova PSA is concerned, no one knows who this is assigned to.

Thanks for your observations Looed, and good to know things have started to calm down in your part of the world. Hopefully structural damage was small and life is returning to normality quickly.

The email I got from Deloitte was essentially to say that any updates would be published via their website and not via any personal requests as there was no money to handle this. I expect they will publish something depending on the final outcome. I am regularly checking that website.

You will recall from the C.R that our main man had signaled that he would contribute financially to help with Deloitte costs but I think that was not received, which (I guess) is not entirely surprising and could be linked to the success of the PSA extension request. My motivation to reach out to Deloitte was based on the time that had lapsed since the first Creditor meeting so thought there would be some developments to report. But as I said in my last post, if news was bad, Deloitte would be rushing to wind the company up as there is no money.

Conclusion: our situation is complex and frustrating. On one hand I think, better to have a quick closure to this whole saga than a ‘death by thousand cuts’. Why so many twists and turns over the years and to what end?

Why does SN fight so hard? Reputation? Perhaps. Huge Resource potential? Yes. Life’s work? Yes. High US political connections and support? May be. Or just too arrogant to admit failure? Hhhmm.

Armoured_bear: please keep an open mind and consider all opinions, regardless you agree or not. It is easy and narrow mindedness to put everything down to conspiracy theories than to pause for a second to take another point of view Me, personally, I am trying to avoid taking in whole b/s that been broadcast to the masses over the many years; we have been thoroughly manipulated with misinformation. I also consider myself to be a peaceful person and believe the ‘Pen is mightier’ than the sword. You say conspiracy theories, well have a look at what is happening in the US. Democracy has been sold to the highest bidder; media is controlled by the few. Nearly all of the US Elected Officials do not represent the views of their majority of constituents. It seems humanity has not learnt lessons of it past tragedies and continues to apply double standards. No harm in having these type of discussions if only to broaden one’s perspective but as a principle, everyone should stand against genocide regardless of where it happens or to which group.

Anyway, good to hear from you Looed and we all hope that you and your family are keeping safe during this time. I will finish off by saying, what a plonker you are Rod****.

Yes, very quiet on the FRR front and a little unnerving tbh; I would have expected some kind of news from Deloitte by now as the last Creditor meeting was held over a month ago. I did try to reach out to Deloitte but they said that as there was no money in the kitty, any updates would be made centrally via the website: https://www.deloitte.com/cbc/en/services/financial-advisory/services/frc-liquidation.html

So, the important question is, is there a proposal from SN that is being discussed behind the scenes? But if there wasn’t, we would have got some bad news by now.

Anyway, People who saw Deloittes Creditor report will recall that it said that one of the main FRC Directors had promised to remit some funds to help Deloitte manage the ongoing FRC liquidation process. But from the last email, it appears that this money had not been wired as their situation ‘felt’ tight financially. On the other hand, why would this prominent Director send money from his own pocket if the Georgian Govt had not agreed to Deloittes request on extending the psa? So, yes the signs are not looking good.

I am a simple person but to me, if there is a facility that is in place, why not draw down on it, pay YA, Mourant and the Georgian Govt and get the PSA extended and start the drilling program in Taribani? How much is needed? I reckon the priority creditors are GG, Mourant and YA and that equates to roughly $10m (this figure is based on my own deduction but I could be wrong). This doesn’t sound like a big amount when you consider the amount already invested in Georgia and is underpinned by a $300m+ cost recovery pool. Also consider the reserves that were identified in the Taribani oil field by WH Ireland report, at c.$450m. But what about the politics locally and geopolitics around, Ukraine, Georgia, Russia?

As far as Looed is concerned, he was an enormous help is facilitating info between us and the company during some really uncertain Ne worrying times, but I guess he is also sitting in an info vacuum now, so what could he say. I guess we can make an humble request to him that he tries to reach out to the company for an unofficial response.

Well, that’s my two-cents right now.

Regarding the ongoing debate about Russia and.the West, I have learnt a lot from watching people like the Jimmy Dore Show on YouTube, or listening to commentary from Scott Ritter and Col Mcgregor. Social media has truly broken the control of the main stream media narrative and now the average person has available a wide breadth of unfiltered information, opinions and facts. Power to the people.

(pressed the post message without finishing it)

…….History has shown when the time is required, people rise and there are revolutions. Take the US Civil War, or the self implosion of the Soviet Union or recently the Arab Spring, no external force required. Geopolitics is a keg-powder and no one has a right to dictate how others should their lives.

Anyway, seems all is quiet on the FRR-front although I guess behind the scenes, there is lots being discussed with the Creditors and it is decision time. My guess is, if SN can find around $10m, he can rescue FRC, but my conclusion now is that he is skint and is now the ‘stone soup maker’ (google for reference).

There is a very good reason why the Georgia’s pathway to EU Membership has been in the very slow lane over the last 15yrs and that’s due to pro-Russian stance by the Georgian elite. Also, the Georgian Politicians are terrible liars, pretending to be West facing but covertly working with Russia (and EU knows this). Equally, talking about the general election is also a false dawn as there are no credible alternative political parties to the Dream Party, due to a deeply fragmented political landscape. At the same time, who can say whether the Russians are really the ‘bad guys’? Take for example the double standards exhibited by the US and EU over the Middle East conflict, while China, Russia stand on the other side. And who is to says the Western way of life is morally superior? I say Power to the People and people will overthrow their Govts when required without requiring the US intervention.

I have to say that any one that thinks that the Georgian elections later this year is somehow going to dislodge the Dream Party from power is being a little naive. Why? Because of the continued Russian influence/interference to obstruct/delay Georgia from becoming a member of the EU and NATO. Consider also that majority of the Georgian people are pro-West but somehow always elects a Govt that is covertly pro-Russian. And there in lies the problem of FRR (and other foreign companies) from not succeeding in Georgia despite investing hundreds of millions of dollars. But perhaps the events in Ukraine and political pressure from EU and the US may trigger an uprising in the Georgian people to finally bring in a genuine West-facing Govt (but I wouldn’t hold my breathe).

As afar as ODR’s questions are concerned, Deloittes attitude on the ongoing liquidation process will be dependent on financial resource available to continue. Like I said in a previous post, Deloitte is not a charity and will therefore only do the bear minimum if no money is forthcoming from the former Director, which means a quick wrap up. If no new funds are available, Deloitte will not get paid and they will move on, hoping to make it up from the next company. Aside from that, success of FRC coming out of liquidation is also going to be dependent on a positive Creditor vote on whatever proposal SN puts forward. But looking at the amounts owed to Creditors, I do ‘think’ that he is probably owed around 50% of the creditor debt.

ODR1, as one of the first recipients of the Deloitte report, I am worried that you have either not read the report properly or trying to entrap someone from breaching the confidentiality clause by opining on your questions. Nevertheless, I have given you an authentic answer for the benefit of others. Deloitte will only get paid if FRC comes out of liquidation which will be conditional on them getting paid and that will be dependent on the company getting access to new funds. And on that, you can make up your own mind.

Things are on a ‘wing and and a prayer’ in my humble opinions.

Cazbraz, yes, I am agreeable to your perspective and that could be the case in order to keep the value of the PSA low and therefore force a restructuring deal with the creditors. As it stands, the creditors stand to get zero dime/penny to their Dollar noting no assets in the company. So any deal where they have a chance to recover any money is better than zero, providing pragmatism prevails. The counter-argument to your logical thinking is, do we still have a valid PSA? Plus, there is no cashflow generation from the oil wells as it seems the shallow producing wells in Mirzaani and MK were handed back to the GG. FRR only has a small area around Taribani (I assume). But the plus point is that GG seem receptive to expanding the area if there is funding in place and legal costs extinguished relating to the tribunal.

gotreal - I also understand your perspective and I also wish to see the glass as half full but I am judging SN on his recent track record. If the funding comes through, I would be delighted. But to unpack this situation, you have to work out what came first, the chicken or the egg? What do I mean by that? Funding would be linked to a valid PSA, but a valid PSA is dependent on getting the legal costs paid to the GG but it appears the company/SN has no money to give GG. Would any fund provider allow disbursement on the reassurance a new PSA will be forthcoming from the GG? Perhaps.

Finally, Ars221 you make an excellent point. Why all the delays and all the legal posturing if no end-game plan? This is why I think creditor claims have to be settled so that the company can be purged for a new beginning and new funding. Do I think there is a game-plan? Yes but it is a highly conditional with a low probability. In a situation like this, you need to your friends in places to come to your assistance, so let’s see if this transpires (covertly).

Anyway, I am now half expecting a knock at my door, providing Deloitte can find enough cash for the visit and return bus fare.

Well, that was an interesting read in the sense it gave a lot on the background of the company and how we got here (and filled in a few gaps on the status of the PSA, re-assignment and amounts owed to the Georgian Govt). So, overall, what’s my conclusion? Not good unfortunately! While there is not enough information on the proposal from SN, I couldn’t see any new money coming in from him to get it out insolvency proceedings. While the report is silent on creditor repayments, I think SN is basically proposing deferment of dues (but for how long, it’s not clear). Further, the Liquidator mentions that their report was limited in scope and research due to funding constraints as there are no liquid assets. Again, we see the usual promise(s) from SN but as we have seen in his FRR tenure history, he says certain things/promises but seldom honors them (ie YA, Mourant, GG). So, now I think he also personally fallen on hard times, and his family reputation is a low priority. Yes, it is critical assessment from me but I want to frank about it (and hope I am wrong).

Also, there is no mention of farm out discussions or partner but that is understandable given the status of the PSA. No reference to the Moldovan PSA, which we can assume is still under FIC, which is managed by Griffin Associates, so who knows where we stand with this.

Is the situation salvageable? Yes dependent on whether new funding can be secured. But GG appear to be friendly now and open to discussions on the PSA providing costs relating to the tribunal are paid and new funding secured.

Toatie, ok received my copy via the ii-website inbox portal, so you may need to log back in to your ii account to download the pdf copy. It seems quite long but I have not read it yet as I m out and about.

Hi theprodigy. Thanks for your succinct summary. And I guess with the number of people that have already ticked up your post, majority genuine shareholders have not receive this report. Further, I am perplex by FSHG’s response that they were not interested. Well. Perhaps they had seen the report but didn’t want to facilitate the rest of us (not a criticism, just an observation).

With regard to ii, I received another email from Deloitte and while they referred me back to Interactive Investor but this time with an additional insightful comment that ii hadn’t even requested the report from them and advised me to get ii to reach out to them. What a dreadful situation.