Member Info for pauldrayton

Bill Dunnett wanted to go ahead with the Liberator farmout originally, and I think it was i3’s work with Repsol Sinopec which identified Serenity.

Very interesting. Thanks for that.

It would seem from the lack of trades that most people are now just sitting on their hands waiting anyway.

I think haggis is just being honest and is right to be so. Yes the potential here is great and investors are backing the management to succeed. But absolutely nothing in the stock market is a guarantee and we have no idea what’s going on behind the scenes. What assets are they looking at? Are they negotiating still? Have deals fallen through? Are their backers still willing to finance them? What terms do they want on that financing? etc etc.

Only if & when a deal is announced can we analyse it and put a potential value on it both for now and in the future. I’m hopeful because I believe the board are shrewd operators, they know the business and they know the North Sea. But I’m conscious nothing is guaranteed unless they deliver.

I haven’t seen any speculation on here about the size of a potential award regarding Monte Grosso. I suspect they will take their lawyers’ advice.

My point is simply that if governments rescind licenses once companies have incurred time costs then there should be some compensation.

That's a nonsensical argument cyan which you could make about any exploration prospect anywhere in the world. What you can't have is governments rescinding the right to drill once a license has been granted and companies have spent money acquiring and surveying them.

I don’t think anybody was suggesting otherwise cyan.

But Pierre Jungels in particular was very excited about it and I think felt it had a better chance of success than the CoS would suggest. A damages award for an unexplored prospect is likely to be insignificant though compared with a proven resource like Ombrina Mare where the potential damages are relatively enormous compared to the current RKH market cap.

Thanks Mogger, let’s hope they win and get a decent % of that claim. It’s taking a while!

The $8/bbl CAPEX to first oil plus $7/bbl OPEX was from an Edison note at the time, presumably informed by MOG.

Looking back, had the Italian government played by the rules Rockhopper would likely be in a very different place right now. Hopefully they get sufficient compensation to make up for at least part of that.

I remember they had very high hopes for Monte Grosso too and they haven’t been able to drill an exploration well there at all.

CitIzen, in the Ombrina Mare FDP, total CAPEX to first oil was €160m. That was an equivalent of $8/bbl CAPEX plus they were expecting $7/bbl OPEX.

Indeed! I guess we will just have to wait and see.

Follow up on ADVFN regarding that article:

But if you read that article it looks like they have it wrong. The ruling in April 2014 simply stated that MOG needed to complete an AIA:

http://otp.investis.com/generic/regulatory-story.aspx?newsid=405285&cid=510

Which was an appeal hearing from July 2013:

http://otp.investis.com/generic/regulatory-story.aspx?newsid=352036&cid=510

In May 2015 (after the acquisition), the EIA was approved by the Minister for the Environment and it included the AIA which was what those previous hearings were about: "The Environmental Impact Assessment ("EIA") of the Ombrina Mare Field Development Plan ("FDP") has been approved by the Minister for the Environment. The approval decree includes the 'Autorizzazione Integrata Ambientale' (Integrated Environmental Authorisation) ("AIA")". So, again, why would RKH take a 50% cut? The decision not to award a production concession was made AFTER the acquisition of MOG, and AFTER the EIA and AIA approval. That decision is clearly in contradiction of the Energy Charter Treaty. So please explain if I've got it wrong but I don't see a lack of due diligence on Rockhopper's part that should affect an award.

With regards to Ombrina Mare, I've noticed some comments regarding Rockhopper's due diligence when they acquired MOG and how that might affect an award if their arbitration is successful.

Correct me if I'm wrong, but when the law was changed in 2010 regarding offshore activities up to 12 miles from the Italian coastline, any applications that were already under review were exempt from that change in the law. This included Ombrina Mare because the FDP application was submitted in 2008 and had been partially approved already.

In fact the Ombrina Mare EIA was approved by the Italian environment ministry AFTER the MOG acquisition, in 2015. This is the RKH RNS from May 2015:

"The Environmental Impact Assessment ("EIA") of the Ombrina Mare Field Development Plan ("FDP") has been approved by the Minister for the Environment. The approval decree includes the 'Autorizzazione Integrata Ambientale' (Integrated Environmental Authorisation) ("AIA"). The decree now needs to be countersigned both by the Ministry of Cultural Heritage and then the Ministry of Economic Development in order for the Minister to be in a position to award the Field Production Concession."

If the Minister for the Environment was approving an EIA after the acquisition then I don't think much (if any) blame can be laid at Rockhopper's door.

So I don't understand why anybody would be expecting a 50% reduction on an award due to lack of due diligence. To me it looks like a pretty straightforward case for the ICSID in terms of liability. Quantum may be more awkward because further appraisal was planned which was expected to increase the 2C resources. The FDP was looking at 10,000bopd with potential upside as well. Perhaps somebody can explain if I've missed something?

If it were that simple the share price would be higher already! We are gambling on them being able to get a deal over the line and hopefully on good terms. Only once we know what the deal is and the asset, will we know what the potential gains (or losses!) might be.

It’s encouraging that the BoD don’t really stand to make much unless the share price is well in excess of £2. They’ve set their stall out, now they need to deliver.

200k volume on Friday is 2% of the company, and 145k of it was in chunks of 25k & above which suggests a large holder positioning themselves. I would not now be surprised to see an RNS next week - not Monday because lawyers don’t work weekends ;-).

And finally another 70k reported late. I think that's been worked all day.

And another £25k. Market soaking them up reasonably well so far.

Some chunky sells this morning. Couple of 25k blocks - perhaps trying to get all out today?

Whoever it is doesn’t seem to have finished selling yet - the pattern continues!

I suppose if they are doing a book build they will involve the original investors to see if they want to take part. If they don’t, and they don’t want their money tied up in a stock suspended for an RTO then you can understand that they may choose to sell before an announcement, but I struggle to believe that management would deliberately delay news just to facilitate that.

Could well be a forced seller like Jub Capital - strange that there haven’t been any TR1s to confirm.