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Whether it's oil, gas, a deep sea port or digital communications there is a clear trend. Brief mention of FRR too
https://azvision.az/mobile/news.php?lang=en&id=130600
http://georgiatoday.ge/news/21966/Frontera-Employees-Demand-Immediate-Repayment-of-Existing-Debt
Georgian Prime Minister, U.S. Secretary of State Hold Phone Talk
https://civil.ge/archives/360552
https://www.houstonchronicle.com/business/energy/article/tiny-houston-oil-company-soviet-state-ted-cruz-15430327.php#photo-19720921
For Frontera, the Georgian government’s announcement they would back off seizing their operations offers at least a temporary reprieve — one they hope they can use to their advantage. Nicandros, now 60 and living in Houston’s Memorial Heights neighborhood, insists a big discovery is just around the corner. He just needs more time.
“You have to take something from the passion of the pursuit and the money we put behind it,” he said. “Look at an old friend in Texas, George Mitchell. It took him almost 25 years to figure out how to tap the Barnett shale.”
Looks like a recent event Zaza attended
https://m.facebook.com/GeorgiaNewLeaders/posts/194254948791015
Best wishes to you and your family Rainbow
Thanks Looed and Puddy for your incredible efforts - much appreciated.
It's a claim under the legal expenses insurance for funds already expended (particularly in Cayman) and ongoing legal expenses. We don't know how it turned out but I'm guessing it was favourable for Hope given the timeframe in which it was resolved and a defence doesn't appear to be have been filed. If it was on favourable terms it gives Hope a virtual free ride in the litigation which will strengthen his bargaining position. Anything the insurers pay out they will seek to recover from FRR if Hope gets a costs order (he already has one in Cayman).
I've come across the above case. It was only filed in March but was dismissed/settled on 3 June 2020 . Unsurprisingly, the matter relates to a dispute in relation to a contract of insurance. I've done some digging and the case history and order for dismissal can be found below. What I can't work out is if it is of any relevance to FRR. My gut instinct is no but there is something nagging me at the back of my mind given the parties bringing the claim and the timing.
If anyone has access to docs on PACER that might help resolve it. Thanks in advance.
https://www.pacermonitor.com/public/case/33218305/Hope_et_al_v_Certain_Underwriters_at_Lloyds,_London_Subscribing_to_Policy_No_B1636N181678_et_al
https://www.govinfo.gov/content/pkg/USCOURTS-cand-3_20-cv-02112/pdf/USCOURTS-cand-3_20-cv-02112-0.pdf
Apologies that I can’t translate the article below as I’m only on my phone but it makes for very interesting reading. It’s not dated but appears to be within the last few hours although unclear.
https://cont.ws/@id458887136/1700187
part 3
The right to pledge / lease movable property and intangible property
Pledge / Leasing Register: R19125407 25/03/2019 18:34:57
Creditor: JSC Bank of Georgia (Georgia) 204378869
Owner: Frontera Riverside Georgia Corporation
In Georgia (Georgia) 204931431
Subject: Intangible Property Goods: Balance Existing Commodities
Stocks for both existing and future
Grounds: Pledge agreement, CAP000326892, Public Registry
National Agency, 25.03.2019
Debtors Register
it's not registered
part 2
Subject
Trademark:
Frontera Risorsiz Georgia Corporation Branch in Georgia Legal Form: Foreign Enterprise Branch Identification Number: 204931431 Registration Number, Date: 5 / 8-108; 24/06/1999 Registration body: Vake-Saburtalo Court
Legal address:
Georgia, st. Paliashvili st., 12, in Vake-Saburtalo district of Tbilisi
Information on the liquidation / reorganization / insolvency process
it's not registered
Leadership / Representation
Director - Zaza Mamulaishvili, 01024002412
Founders
Fronter Rissorz Georgia Corporation, CR-72227 / USA /
Seizure / Prohibition
it's not registered
Tax lien / mortgage right
Tax lien / mortgage: 102019424904 19/11/2019 10:33:41
Branch of a foreign enterprise (representation) Frontera Risorsiz
Georgia Corporation Georgia Branch S / N 204931431
Subject: whole property, whole property
Grounds: Notice, N00640586, 19.11.2019, Revenue Service
Part 1
New doc added for Frontera Rizorsiz Georgia Corporation in Georgia on 11 My 2020
https://www.my.gov.ge/ka-ge/services/6/service/179
Best translation below (link above for anyone wanting to see orignal)
Commercial) Legal Entities
Application registration number, preparation date: B20032748, 11/05/2020 19:34:20
Information on the subject
Identification Code
204931431
personal number
State registration number
5 / 8-108
Name
Frontera Rizorsiz Georgia Corporation in Georgia
Legal form
Branch of a foreign enterprise
Registration date
June 24, 1999
Status
Registered
The PSA states material breach for termination. In English law, this has been held to require something LESS THAN a repudiatory breach but the breach must still be significant. Failure to return 99% of the Block is material but you don’t have to take my word for it, you can take the view of three arbitrators.
Within hours of Frontera's announcement, the state-owned oil and gas company issued a response statement calling them "false, incorrect." At the same time, they noted that they are terminating the contract with Frontera . According to them, the arbitral award gives you the right to do so.
On the frontline, On.ge was told that this information was not true and that they could continue working.
"Due to the gravity of the request, the contract was terminated, which was also not satisfied by the court," Mamulaishvili said.
Nevertheless, the Oil and Gas Company has stated that the Frontera has already been notified and the contract will be automatically terminated upon termination of the term specified in it (July 27 of this year). They also call on the Frontera to comply with the decision of the Arbitration Tribunal, including the payment of funds to the Georgian side (approximately USD 6 million).
At this stage, only the positions of the parties are known, which does not allow for full information. The details of the arbitral award will be known only if both parties agree to make it public. The oil and gas company says they are ready for this and are waiting for a response from Frontera .
Learn more: Oil and Gas Corporatio
On.ge was interested in what part of the arbitral award the company is satisfied with and what the court satisfied the plaintiffs with. According to the President of the Frontera , Zaza Mamulaishvili, the arbitration did not meet the main requirements of the agency and the corporation, which concerned the financial part and required them to pay about $ 100 million.
Photo: BM.GE.
"Most of the demands were for us not to pay certain amounts of money to the state, not to give our share of the oil and natural gas we got, so we demanded compensation for that money.
"Because these claims were unfounded and did not violate our terms of claim and did not take anything from anyone else, the court was not satisfied," he said.
As for the statement that the Fronter was instructed to pay the costs incurred by the plaintiffs in respect of the arbitral proceedings; Speaking to On.ge, Mamulaishvili explained that the plaintiffs were also obliged to pay this amount. He said the court had split the money.
According to him, the information that the court ordered them to pay the fee for the use of natural resources paid by the Oil and Gas Corporation is also inaccurate.
"Every year, we pay the state in advance to the state in accordance with the natural tax rate. According to the agreement, we pay it in 23 years. Even now, we have confirmed in this court that this amount is payable and we were going to pay it.
However, we told the court that they had to pay us $ 6 million in VAT and we thought that this amount would be deducted here and we would balance it out, ”he said.
The president of the Frontera confirms that the tribunal considered it a violation for the state to refuse to return the search area, but explains what it means:
"Under the agreement, we are entitled to return to an area where we are not working after a period of time or for some reason. In today's resolution, we retain 100 percent of the oil and gas fields and return some of the areas we do not use.
The tribunal has ruled in violation, but whatever we have to return next year, we will return this year. We were telling the state that people were working there and if we were to be asked to come back now, we would have to ask those people and Barry Gais to come back so that those people would not be left unemployed. But you don't have to worry about these people staying unemployed. "
According to Mamulaishvili, it is also inaccurate information that the arbitral tribunal granted the motion to dismiss their claim and terminated the proceedings in connection with these claims.
"It simply came to our notice then. The lawsuit was settled out of court. About 10 months ago, we filed a goodwill agreement. At the same time, we negotiated some agreement and it was our goodwill. At any time, bring it back and ask the corporation to pay for that damage It is worse then worthless, it consumes time and resources but returns no sales.
Within hours of Frontera's announc
The state terminates the agreement with the front - what happens and what the parties cannot agree on
Photo: Frontera resources Georgia
http://go.on.ge/1k5m
LEPL Georgian State Oil and Gas Agency, JSC Oil and Gas Corporation and Frontera Research Georgia are again making mutual accusations. This time the reason was the decision of the Arbitration Court. The Oil and Gas Agency and the corporation say they have won the arbitration and have met most of their demands, which the Fronter denies, accusing them of trying to discredit the company.
Also, the agency and the corporation claim that the arbitral tribunal has found a breach of contract on the part of the Frontera , which entitles them to terminate the contract. Frontera denies this either.
What was the dispute in the Arbitration Court and what is happening now
Frontera Resources is an American-based company that aims to extract oil and gas. The company Frontera Research Georgia started working in Georgia in 1997 and during this time they have repeatedly stated that they have found a large supply of gas. The state and the frontier were arguing with each other in the arbitral tribunal, which has repeatedly been the subject of political speculation.
One week ago, on April 21, the Oil and Gas Agency and the corporation announced that the arbitral tribunal had supported their interpretation of the norms of the contract and had met the absolute majority of their claims. They said the tribunal had found that the Fronter had substantially violated the contract, which was reflected in the refusal to return the search area (99% of the entire licensed area) to the state.
According to them, the Frontera was instructed to reimburse the amount of the fee for the use of natural resources paid by the Oil and Gas Corporation, as well as the costs incurred by the plaintiffs in connection with the arbitration proceedings. The statement also said that the tribunal had granted the motion to dismiss the claims filed by Frontera Riverside Georgia Corporation and Frontera USA and terminated the proceedings in connection with these claims.
The company Frontera responded to this information today, April 29. They said in a statement that the Georgian government and its lawyers had deliberately made incorrect public statements that would distort the results of the arbitration. According to them, the fake news spread these days and the public statements made by some members of the Georgian government contain an inappropriate attempt to insult the US government and discredit both them and other supporters of American business like Frontera .
The company said it was pleased with the decision and called on the government to end its unfair PR campaign against them and other US businesses operating in Georgia.
On.ge was interested in what part of the arbitral award the company is satisfied with and what the court satisfied the plaintiffs with. According to the President of th
A very close friend of mine was at Hogan Lovells and I know the firm well. I would suspect their press release was fairly accurate although the key question is always what is left out/not said.
My big fear as Mole has mentioned was the GOGC using a finding of “material breach” to terminate the entire PSA.
I also agree with Regdik’s interpretation which he kindly set out this morning.
If the arbitration award (and none of us know) made a finding of material breach then it was conceivably possible for it to also go on to state that the GOGC had the right to terminate the PSA for material breach. It does not appear to have done that. That could be for the following reasons:
- It deliberately wasn’t pleaded by the GOGC (largely because termination is a very tricky area and if you get it wrong you are on the hook. The GOGC may have played it safe and just wanted a finding of material breach which they could then use later)
- It was pleaded but the arbitrators refused to make such a finding
- It was pleaded but the arbitrators fudged the issue.
As I said in my last email, the GOGC press release announcing the award was strange as, in my view, if it had been given the right to terminate it would have announced it from the rooftops. The press release made a clear distinction between enforcement of the award (the tax and the costs and probably the return of the 99%) and other actions the GOGC may take as a result of the award. I said then that this other action would be based on what a finding of “material breach” would allow them to do and they would certainly be taking legal advice from Hogan Lovell’s on that. They have now got that advice and from the notice served yesterday they firmly believe that the finding in the award allows them to terminate.
If the award clearly says that the material breach entitles termination then I’m afraid it’s check mate. I’m not sure, however, that it is that clear cut. We just don’t know. Whatever was said in the award will stand legally. If it didn’t say that it gives them a right to terminate then it’s check. The GOGC may rely on the arbitral award for the finding of a material breach and seek to enforce a termination that way as part of the award. That may be a bit tricky and feels like back door enforcement.
Alternatively they can use the award and terminate albeit that this may be an additional step not covered by the award (which is what FRR will argue). In that case, this might lead to a new legal dispute in the form of another arbitration about the ability of the GOGC to terminate. If that were the case, again I’d rather be acting for the GOGC as we are likely to be fighting a losing battle. However, that will give more time and the only realistic way out is a negotiated one which with the current covid crisis and the imminent elections in Georgia does not appear at all likely at the moment.
Arbitration awards are confidential to the parties unless they agree to its publication. The fact that the GOGC are willing to publish and FRR not tells me the answer I need to know and like ODR makes me deeply suspicious (although I hope I am wrong). A very close friend of mine was at Ho
This bit caught my eye:
The controversial issue concerned the share distribution of contract products in oil production. The Georgian side put forward several demands, the main of which was the return of the territory, which Frontera does not use for exploration and oil production. This territory makes up about 99% of the license block. The area was to be returned back in 2017.
Georgia wins American company in international arbitration court
Economy
07:01 04/28/2020 (updated 11:13 04/28/2020) Get short link
2570 4 2
Frontera has to pay corporations a fee for the use of natural resources, as well as reimburse legal costs
TBILISI, Apr 28 - Sputnik. The American company Frontera lost to the Georgian Oil and Gas Corporation and the State Oil and Gas Agency in an international arbitration court, the company’s website said .
The controversial issue concerned the share distribution of contract products in oil production. The Georgian side put forward several demands, the main of which was the return of the territory, which Frontera does not use for exploration and oil production. This territory makes up about 99% of the license block. The area was to be returned back in 2017.
"The arbitral tribunal supported the interpretation of the contractual provisions of the Georgian Oil and Gas Corporation and the State Oil and Gas Agency and satisfied the vast majority of claims," ??the statement said.
According to the corporation, among other issues, the arbitration court found that Frontera had substantially violated the contract, which was manifested in the refusal to return the state of the territory under study to the state.
By decision of the court, Frontera is to pay the corporation a fee for the use of natural resources, as well as legal costs.
Georgian workers against American company: protest rally held in Tbilisi >>
Frontera Resources Corporation, an American gas and oil exploration and production company, was founded in 1996. The company's strategy is to search for hydrocarbon production prospects in the markets of Eastern Europe, which belong to the Black Sea basin. The company currently operates in Georgia and Moldova.
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