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Likewise Jiving I am happier with a better understanding of what is going on and having a date to work to. Plenty of scenario's as to why this is happening and more importantly why it is happening at the very point that the finance was imminent (according to Art).

Whatever the scenario's if Shorecan has the material from Essar stating they cannot pay their share how can they pay 'fair value' to Shorecan in the event that any court case goes their way. They would only have 180days to pay before any award is null and void and it reverts back to the original agreement. Then you have to read the Nigerian Petroleum Act to see that the government can take everything off of Essar.

They are after all they can get but not the whole.

The Oilex RNS out today seems to have parallel's with our situation notwithstanding it is in India.

In that case one party has asked the Ministry of Oil to transfer to itself a partners participating interest in the Production Sharing Contract due to a failure to remedy an Event of Default Notice (EoD Notice) within the required 60-day period. The EoD Notice was a result of an ongoing failure to pay its participating interest share of the PSC expenses (the main issue it seems with Essar in our case).

From our company, 'Essar Mauritius has replied with a notice asserting that it would have the right to terminate the Essar Nigeria Shareholders Agreement if ShoreCan does not remedy its alleged breaches by on or about October 9, 2018.'

If the company received that notice on or about 11th August (we were first notified on 14th August) then that would be 60 days to the 9th October deadline. The wording of Essar's notice mirrors an EoD.

So if we don't resolve our disagreement by 9th October and it follows the Oilex example, Essar may apply to the for our rights to be transferred to them at which point the second part of the company's discussion kicks in, 'If Essar Mauritius did purport to terminate the said Shareholders Agreement ShoreCan has stated that it would contest any such action vigorously in the English courts which would have jurisdiction over any formal dispute. The Directors believe, based on legal advice, that ShoreCan has several valid defences and counterclaims to any such action that might be brought by Essar Mauritius in the event that the current dispute escalates.'

Let's hope Kola and Art use their negotiating skills to prevent it getting that far.

If the other sides lawyer doesn't turn up again then it should be all over by lunchtime Bob:-)

I've added today as I fully expect this to start on a definitive road to production from the moment the tender is accepted, no matter the percentage of the contract awarded. Its all about getting that line from gas to power open. The odds are firmly in favour of TLOU getting a government contract.

On balance the only thing I see holding this back is the dispute with Essar. The company have given considerable detail on the Agamore issue the position of which has always been known to shareholders and it is easy to see why they, Shoreline and the government agencies are confident it is a dispute without essence. I fully expect the court in Nigeria to rule as such. Similarly the service provider agreement seems to be waiting in the wings, giving front end finance assistance to the back end finance from Bank of Mauritius/Trafigura. Given the prompt we have apparently been given by NNPC to accelerate our drilling program I don't see any issues at this stage on transfer of ownership or licence extension to go with the mandate approved by the DPR. So for me get the Essar dispute out of the way through negotiation and we will see everything open up.

Sorry didn't check the auto correct;

'Investors though have to realise......'

As I see it I am pleased that Arthur has sidestepped the share consolidation required by the TSXV. Not an easy decision I guess to declare you are being kicked off an exchange. Investors though have to release that this is not company specific, it applies to any company that drops below the .05c share price. I never see it as a good sign when a share is consolidated as usually follows a well defined course, low priced stocks with high number of shares in issue due to a history of placing. Generally its a false way of raising the sp and in doing so gives more leeway to embark on more placings. The CEO could have taken the easier route and consolidated in my eyes but didn't. I'm happy with that decision.

The only concern I have is why he is bothering to stay on any Canadian exchange at all given the TSXV has contributed absolutely zilch to the value of this company in recent years. He might be better served to consider a complete move to the UK. Not sure I see the attraction or any benefit to shareholders of being on the third level exchange in Canada when they are on the main exchange and do all their placings here.

Thanks R-Dunc that is a great help.

'Essar Mauritius are in serious financial trouble, many of their assets are in receivership'

R-Dunc can you elaborate on that. I've been trying to get my head around Essar Mauritius's company structure particularly after Essar Oil Limited was sold to to Rosneft and Trafigura-UCP Consortium for US$12.9 billion in August 2017. Seems you have made better headway than me. Additionally have you come across our nominee director of Essar Mauritius, Ashish Kumar (who sits on the Essar Nigeria board) on your travels?

ATB NE

I accept the share price is where it is because the market reacted to the last tender disappointment. Having been around resource companies for some time now the one thing you get an appreciation of is how it reacts to news of increases in resources etc. Suffice to say that generally once past the initial euphoria of a discovery the impact lessens to the extent that resource increases become a non-entity in terms of impact on the SP. However its clear that those resource increases aren't actually lost in terms of uplift to the share price, they are merely delayed for the successful company, stored up to form the fuel for a share when its clear that production is definitely on.

A rational look here is that the only thing on our radar is the expectation of significant good news. Again, if looked at rationally, the probability of a successful tender process this time round has increased significantly, a point TG intimated in the announcement.

Time enough.

BigBear, Only this which I posted previously so you may already have it. From the 2017 prospectus;

On 20 December 2010, Essar Nigeria entered into a commercial agreement with Agamore Energy Limited ("Agamore") ( a private Nigerian company) styled a 'Farm In Agreement'. Under the terms of the Agreement Agamore was to receive a 37% participating interest in OPL 226 in return for the provision of certain services including facilitating obtaining all necessary governmental approvals and taking responsibility for community affairs and other matters.
The Company understands that approval was sought from the Nigerian authorities for the transfer of the interest but was declined on two occasions. Agamore did not provide the services to Essar and Essar, latterly on at least two separate occasions, wrote to Agamore seeking to resile amicably from the agreement. No response was received to these letters. Shorecan, in its due diligence before entering its sale and purchase agreement for 80% of the issued share capital of Essar Nigeria, identified that Agamore had no active presence in country, no web site presence, and no operational activity and no discernable in-country infra-structure. Shorecan and the Company formed the view that Agamore was in material breach of the Farm In Agreement and accordingly, insisted as a condition precedent to the transaction that the seller was to terminate the Farm In Agreement. In the event, the condition precedent was waived by Shorecan on the understanding that the matter of termination of Agamore be referred to the new Board of Directors (following the appointment of the Shorecan nominees). By way of written resolution the directors of Essar Nigeria resolved to write to Agamore giving formal notice of termination of the Farm In Agreement . The notice of termination was properly delivered on the 13th of March 2017. The termination letter referenced the failure to provide services and the failure to secure consent to the assignation as grounds for termination. The thirty days notice required has passed and the Farm In Agreement is now considered by Essar Nigeria, Shorecan and the Company as terminated.

Pertinent presentation on Mozambiques role as a gas to power supplier in Africa.

http://tlouenergy.com/wp-content/uploads/2018/08/Final-Tlou_AOGE_2708.pdf

Line for line that is undoubtedly the best post you have done here Baserite. The expenditure now on technical skills can be more than recompensed with success along the line. Exactly what Arthur is saying and I agree. No more placings though before the SPA and NNPC would be a pretty good result..

Anyone thought that the cash spent on geologists, technicians, consultants etc is exactly what is being used as our defence against Essar's charge that we haven't spent?

I hope it doesn't get anywhere near any court Bob but if it has too then we know that in an English court there won't be a perverse decision based on back-handers. Given that the company have said there is ample rebuttal evidence available and they believe the issues also lie with Essar then that is a good thing. Hopefully in a short time period we can move on from this dispute issue. Its a damn nuisance and a costly one at the moment.

Jiving, the alternative you mention would be good and would fit in with Essar's 'request' to comply. If this dispute is sortable between partners there is nothing to say that it couldn't be sorted very early. Its not knowing the details that always leaves us flailing around for answers when we don't even know the questions.

'Dispute needs to be sorted before financing can be completed. Now that we are all accustomed to 'Nigerian time', how long could that take??'.

John, the dispute will have nothing to do with the slow pace of things in certain parts of Africa. The dispute is between partners and only if it goes to litigation will it then fall to the English courts. No Nigerian governmental or regulatory body is involved.

'We are continuing working on the project financing, the completion of which is related to the resolution of the disagreements with Essar.'

Jiving I will go with the CEO's take rather than Cathy's. On the face of it, but I stand to be corrected, iamrich's reply from Cathy was a pretty broad reply to a pretty broad question.

iamrich, just for clarity did you ask the specific question that seems to have been answered by R-Dunc's and Mkbarnes reply from Arthur namely can the Service Providers Agreement go ahead whilst the dispute with essay is unresolved?

'...my question if everything is on hold till the Essar dispute is over..'

Was that your question? 'Is everything on hold till the Essar dispute is over' or did you ask specifics iamrich?

Good bullet points for the main issues here Bell60.

Like all one liners though there is always additional information behind them that can be used to form an opinion. In my opinion some of the risk you have identified can be mitigated quite heavily others not so. It's a sliding scale of potential risk that is then weighed against potential reward. Your post should help if some want to carry out research in the key areas. Thanks

Just the one point on the 'inside council installed', the company have had in-house counsel for well over a year to my knowledge so not a new expense if that was indeed your thinking.

Still a high risk play here.

ATB NE

I have to say I enjoy your posts RD.

The bit that struck me from the prospectus was the open ended nature of any resolution.

'The Essar Nigeria Shareholders Agreement does not provide a timeframe for either the appointment of the investment bank or the determination of the fair price. Once a fair price is determined the parties would have 60 days thereafter to close the sale of the shares subject only to the receipt of any necessary regulatory approvals. If the sale could not be completed within 180 days of such fair price being determined the sale process would be voided.'

Forgive me if I have got this wrong but, 'the parties would have 60 days thereafter to close the sale of the shares subject only to the receipt of any necessary regulatory approvals.'

Would Essar need any regulatory approval given they actually own own the licence given no acquisition approval has yet been given. They would only need an extension to the licence. But if they did need regulatory approval or indeed legal necessities held up the settlement for longer than 60 days (highly likely given its Nigeria) then there is 180 days in which to finalise. No mention is given of any penalties for not completing in that timescale so delay tactics and then the sale process would be voided and they are back to square one, a partnership between Shorecan and Essar. It certainly doesn't sound like a productive route to me for Essar to go down.

It does smack of a power play and I think that will be shown to be the case. If proved wrong and they go hell for leather then they will have to pay a good old whack as fair value. I don't play poker but I think the objective is for your opponent to blink first unless of course you hold a great hand when you don't want them to blink at all until you have taken all their money off of them. I think Essar have a hand but not a strong one given the legal advice Shorecan have recieved. I think also that they would have been more forceful in their letter and stated they will terminate the agreement rather than they think they have the right to. Semantics I know but my best guess.