it seems that the US are raising the anti and not backing down.
I think that some in high places in the US are using FRR as a battering ram. If the GG blink then I think a mutual settlement will be on the cards
Phillim I hope out of all this you can get some satisfaction that your sons judgement in buying FRR shares was a good one and that one day we can raise the first celebratory glass to those that are not with us now.
A lot of Georgians are weighing in now with their views and not very complimentary towards FRR. Very selective in their view focusing on the unpaid workers as the main point rather than key failures in fulfilling their contractual obligations. If the workers contracts are with subcontracting drilling companies (often the case) then no doubt the liquidator would not release funds to pay them as they would have to join the list of creditors.
If these employees are directly employed by FRR then failure to pay would cause a breach of licence.
So not knowing who directly employ these workers (84) then GG do not have a strong case as FRR will point to the issue with FRCC (5%) and claim they made provision to cover debt costs and it was others that failed not them. FRR therefore must have others on the payroll not directly associated with FRCC. If these are being paid FRR are not in breach of licence.
I did not expect GG to react nicely or rollover at the new spate of US correspondence. However, it is a wake-up call that billions are at stake here from potential US investments and access to NATO/EU.
I think FRR can point out to 40Mil investment in Georgia over 20 years and undertook a very intensive data gathering process that has now attracted the Super majors to take an interest in Georgia. FRR have seem to have found the key to unlocking the box and now GG want to change the lock. This is what the US Gov. are pointing their finger at and the strangulation of companies due to late payment of tax refunds and red tape.
FRR are a small buy strategic chip in this game of poker and if they are wiped off the board with nothing substantial then US will do what US do best – take way their ball and threaten trade sanctions as the US Gov have heavily supported Georgia and will not be happy to being let down (a lot of high profile political reputations are on the line) .
This will impact Political stability in Georgia and this will be an issue for the Majors and will dampen any significant growth in investment. Instead of being energy independent in a couple of years Georgia will be back buying O&G and having to borrow more from the International banks who will increase interest payments due to the higher risk.
From a position of hope joining the west and reaping the rewards of investment to looking towards Russia and Putin (and all that will bring). How will the Georgia people react?
Just over one year on from "game over" message and still going on about the side show of the US CC's.
This will be decided in Georgia and Arbitration ruling.
Let the plebs fight over the crumbs as FRR and US Gov have the real battle with the Dream party
Not long to wait _ the US Gov will have all the facts checked prior to throwing their weight behind FRR rather than be made a fool of themselves in front of Russia and the rest of EU.
So GG have spent over 6Mil on lawyers (best in the land) to fight little old FRR for their block (or most of it). The offer to extend to 2027 which FRR threw out so w are now waiting for Arbitration on a block with no gas (or so they now say).
If I had a strong case I would not offer any concessions however, it seems that FRR did seem to offer a 50/50 deal with the GG. So prior to the final ruling it seems the horse trading continues.
The US letter seems to have rattled a few cages in Georgia and Russia raised the stakes will this push them East or West.
I now doubt that we will be thrown out of all of B12 (why offer a compromise) but the value of years of data gathering (and spending 400Mil) will be a significant factor for the Arbitrators to take into consideration (the NSA report and subsequent drilling results will only strengthen FRR case. Unless FRR have broken their LtO contract then I can’t see a total loss. GG failure to pay their Vat bill will also weaken their hand as would KK outbursts in 2016 about FRR. So its not the first time that they have claimed we have no gas.
All to play for.
Well some interesting take on todays event.
First I must say I have no idea what this means but looking back over it may give some indication.
GG seems not to be playing as expected by those whishing to open up the country to the West. Russia would not like what is happening in their back yard so interference is to expected. We are potentially talking tremendous regional energy based influence and not to mention big money. Add to this a ready made path to market (BP pipeline) will look like an attractive prospect to those who like to poke their finger in the pie.
So Russia and those that support them in Georgia would look for any reason to land grab but will try and do it legally and not just throw a US Gov. backed company off their block (although I believe they could). Arbitration is supposed to be independent but with so much at stake.....
So we now see why the majors have held back (block ownership and Russia in the background) and with so much at stake could explain the tight lipped approach.
The tone of the letter from the senator to me can be read one way is that diplomacy is not going well so the Trump factor of throwing the kitchen sink at the potential problem. Pool old FRR are the middle of this but I’m unsure if the rubble or the dollar will win out – the people are looking west the politician are looking at Putin and the potential riches that the friends of Russia seem to acquire.
I agree that it would be a stretch to link Hope to the Russians (but they have history) as the Arbitrations is key to the final ownership of the block. A fact that would work against Hopes aspirations.
What will be the outcome
GG wants 99% and it looks like FRR proposed 50% if previous finding are an indication. Or around these figures (5% in the liquidated company will revert to GG).
However, it is a positive that the US are openly backing FRR plus Exxon have finished their review of Georgia and two offshore blocks are up for grabs. I will also add into the mix is that Russia do not have the expertise of BP or Exxon to develop such a complex fields (B12 and offshore) they will be reliant on Western knowhow and technology. Those at the top know this.
I have said this was always political and the outcome will decide FRR future and not Texas/Cali.
The 3.5Bil CC treat could be the deciding factor to how this plays out and I hold no hope to regaining any sunk costs as this is baked into the core of the LtO franchisee – expenditure is at the prospectors risk. FRR are alive but god knows how so I remain on the positive side.
Alas the poor dog died of old age and the car damaged its axel on the bump on the road. ZaZa is suing the council for not repairing the bump in the road but the council are counter suing ZaZa as FRR sledge hammer gang failed to flatten the bump and spent too much time trying to smash a nut (on Hopes head). The sledge hammer gang did not complete the task as they were on strike for not being paid.
Just business as usual
This event is way out of my knowledge zone but Oppsi’s point resonates with me that in a case of asset transfer to a family member (the LtO would have to go through the approval process with the GG) may be tested in court by those interested parties (SH/Creditors). Aurora1 has also a valid point.
So if these have been created by “the family” in 2015/6 to take advantage of the spin off business (Multimillion value) if the licence holding company was sold off. Being a local business owner and Georgian “the family” could add value to a company developing a large field (providing the necessary service infrastructure).
1 Why use a closely linked name – unless wanting to retain a close association to the sold off entity (known entity).
2. If he wanted to stuff us this would not be logical due to the close association and potential future litigation. Better use a distant relative or close associate.
3. These companies were created when the large gas numbers were being proved thinking ahead?)
Yet again guess work but there is a lot more info now seeping out.
Gosh I wish I could see some real long term blue sky soon. The golf course is like a swamp and my alternative revenue stream of taking the scam money has dried up which has curtailed the pie buying.
As a fully paid up member of the middle management tummy rubbing club we spend a lot of time risk assessing and ensuring we discard the chaff and concentrate on gathering the wheat. So decision making is based on what is known and what risk the unknows are. Similar to posting you can either base on facts (not may of them I know) or logic but make it clear what you base your opinion on.
Buying/dealing in shares is a risk as those that do accept the risk. Smart ones never overstretch and ensure that any losses are manageable and will not cause other (family) harm. Taking a gambling position such as a spread bet is a risk too far for me personally as if I get it wrong the loss could impact more than myself.
Will this share come good I would put it the high risk of failure pile
However, FRR is defying logic as it is by all intense and purpose bust, no known revenue, small retained workforce (has to be one due to the gas plant and small production wells, if not GG would have to step in to ensure HSE is not compromised) and CC escalating costs (Inc. Arbitration). So what is keeping the US Gov on side, the GG not just taking B12 and OMF/Liquidators fighting on.
It is not based on blue sky strategy on what B12 might have but the smell of MONEY.
I know how much of the stuff I will be down if this officially goes belly up, annoying but not life changing for me (stuck to my investing rules). Can those that short or take a gambling position do the same?
I hope this come good for all LTH’s and those that took a different investing route how will you explain this to your loved ones your potential losses.
No one not even Oppsi can fully understand what is going on with all these interlinked CC’s. From the side line there seems a lot of inconsistencies, information gaps and a strong mix of international, jurisdiction and commercial law in play.
Originally split the LtO without the full backing of GG which looks like it required a retrospective action to gain agreement.
What we do know about FRR Is that lawyers/litigators have lodged a lot of documents but until the presiding judge rules on these they are just one sides interpretation of the law (unless the lawyers jointly submit an agreed action).
FRR have gone through a number of respected law firms – who I expect were uncomfortable with FRR’s ducking and diving and sailing close to edges of the law. I doubt that was the original plan but served a purpose of buying time. They may have found a more flexible firm so FRR have embedded themselves in a PO box at a top asset protection lawyers premises.
Interestingly every Judge seems to be advocation arbitration rather than a full CC
Litigators want discovery of documents from a number of FRR entities (but how many of there documents are lodged in Georgia).
Final testing of the asset transfer by Georgian LtO has to be in a Georgian Court of Law. (if you think this has ben drawn out then just wait till this International part starts)
Litigators are certainly racking up their costs so must be comfortable that they can recover most of them (if not all).
However, without a successful conclusion to the GG/FRR Arbitration case all of the above is just noise. So continuation and escalation seems to indicate that those in the know must think that a settlement is agreed and there is something worth chasing (and it wont be the licnce).
Just trying to be logical and not like others put my view out there as fact and that the “game is over”.
FRR have a lot of sunk costs (400M+) in B12 and a loss of the LtO this would not be recoverable. As you see by Oppsi’s post ARMCHAM are still debating the Geopolitical issues of the region so I do not underestimate the value of the US Gov backing US interests in Georgia (and FRR’s).
B12 could be worth many many Billions if 10% of the reserves are true. However, it will be in the billions to monetarise this asset and get it to market. So you need some one with deep pockets and a vested interest in the region as an ideal partner. GG, FRR and the majors know this as do the Russians and Chinese. FRR even with 150Mil loan it would take years to reach the billion dollar target ZaZa set. I do not think this is acceptable to the GG as their future security lies in NATO and ultimately joining the EU. To achieve this aim it would not be to bad to announce a large energy field (5th in the world) and an agreement with a Super Major to develop their joint fortunes. However, the best prospect is with a tiny bankrupt prospecting company but unfortunately have the ear of senior US politicians.
So IMO a deal has to be (is) agreed that is in the best interest of GG, FRR and US pollical interests.
Haven’t a clue what that will end up looking like but it will be better than where we are now.
My own thoughts it will involve payback of some of the sunk costs (explains our Ukraine bid money and looking for other opportunities) and a production/profit share deal. It cold be the GG/FRR + Major partnership or a one off payment and bye, bye to FRR in Georgia.
Just think of all the pie’s I could buy and who I could pay to rub my tum.
As some will know always base your theory on a thread of truth and twist it to met any agenda you have – politicians do this all the time so as not to outright lie or deceive but to gain favour or votes. Business do to show themselves in the best light and some on this board are masters at it.
However, taking this into consideration those that are required to put their name and reputation to what they produce or write need to ensure that what is stated is based on fact (if not heavily caveated and reasons given).
So lets written and disregard the “good” intended words
Court submissions – just highlight one sides view of the world and until tested in court cannot be taken as fact.
LtO – Contract witch will define the parameters (both sides) will adhere too an can only be changed by mutual agreement or tested in court. Disputes solved by independent arbitration.
Loans and mortgages – as per first part of LtO without the arbitration.
RNS – Independently verified prior to issue as to be a true statement at that point in time.
Audited Accounts – as written on the can and signed off by the independent auditors.
Company Web site/documents (inc AGM presentations) are a sales pitch to investors but have to be based on the RNS/LtO boundaries so should be taken as a sales pitch rather than 100% factual.
Newspaper reports are just the authors view based on what he believes will interest his audience
CPR – This is the interesting one as this has to be verified by independent specialists (NSA) so this should be seen as factual as it gets. It is often littered with if’s and but’s but underpinning is the true potential of the field. MadP has based his figures and assumptions on a mix of this and the AGM presentations. I have in the past have poured cold water on these due to his optimistic view. The asset under the ground has to be commercially viable.
Somthing changed over the last 3 years in Georgia to a stance of total disbelief of commercial viability to eagerly selling off more blocks and attracting the interest of the O&G super majors that came a calling. The Supper powers also decided that Georgia should be their new best mate and each are looking to invite them into the fold. All Georgia had was good wine and a country that allowed a pipeline path to the West.
OMF interest in FRR became more prominent looking at first to take the asset then looking for personal guarantee shares.
FRR has been fighting for its very existence and spending a lot of cash on US political support and solicitors fighting off the interests of others.
Do GG see that this company is potentially sitting on a tremendous opportunity for its country and that in their view is not being developed fast enough. So my theory is that major part of B12 will be hived off as part of the arbitration and sold off to a SM and leave FRR with a sizable but valuable part. Enough to interest a major and acquire funding to pay off debt and start a new chapter.
Oh dear what a mess of a discussion board this has turned into. I think we should ask LSE to change the BB name (any suggestions).
I will not get into a war of words with those who are very good at picking phrases and words and putting a constant spin that due to the communication lock down NO ONE can really win until the dust settles and we may get to see the real storey (if ever).
I prefer posting points that can bee debated that really may impact what may be going on.
The elephant in the room that trumps any CC discussion or what a historical document may say is the arbitration.
Oppsi pointed this out and referred to one of my earlier posts that in black and white FRR have defaulted on their licence to Operate (LtO). This (and I suspect Oppsi) is one of my Middle management skills is that I know a lot about. Most LtO’s are constructed in the same way (differences are mainly around boundary, duration, investment, targets, share and using local services).
What stands out is that GG have more than a strong case to relive FRR of their LtO without the pain of arbitration. Oppsi pointed this out with reference to GG removing a contract from the deep water port due to failing to hit target and finance plans although work was progressing.
LtO’s also have a fit and proper clause that is to ensure that companies follow the law and financial rules and of course any FRR default would immediately validate the LtO. I think one poster in particular could point out several failures of FRR
This raises a question why go down the arbitration route and why the FRR counter claim (3.5B).
You can only speculate that this is a land grab for B12 and the high profile US Gov involvement is pivotal to ensuring that GG have to be squeaky clean. Why the sum of 3.5B as this would have to be based on production (what production), proven reserves (not less that 90%) or figures based on a potential agreement. Any court would/will throw this out without a factual evidence trail.
FRR are still in existence so focus should be on the Georgian arbitration and not court documents this alone will decide the future of FRR and any potential gain/loss to all that have traded in FRR shares (long or short).
That enough from me its pie time followed by a good Sunday afternoon tummy rub.
Also having read the mortgage agreement being a sad middle manager. I would point out only the liquidated company would trigger the freeze in interest (by US law) but the master agreement for the loan due this year may be exempt du to the complex structure of FRR companies and guarantees. This is why expensive lawyers are hired and nobody on this board unless they have all of the corporate agreements and supporting articles can they take a view of any outcome. It is not a simple yes/no situation. Like everything around FRR this is clear as mud and we will only know the outcome after the CC''s.
Wow l go away for a couple of hours to eat my pie's and rub my tum and l miss all the fun (not). Brgmg69 give it up as you are conversing with a black hole and can never win. You have seen my L-in profile and CV so you know what l did in BP and who l'm connect with.
Let this play out and just let the black hole enjoy his moment as he can do nothing to change what is coming. For good or bad we are all in this together and only one side will come out of this with something. Well must get back to the pie's.
Hi Rats got a nice letter from a case officer that they are in the process of reviewing a high number of complaints on a number of shares. This is part of an ongoing investigation and findings will be issued by the relevant authorities to assess what action should be taken
As you are very low down on my credibility list, I never generally do not bother responding to bottom feeders (just to correct errors).
enjoy your wait as like the rest of us we cannot influence what is about to happen.
Dulwich good post
BP 5 year plan includes a number of key objectives and that includes Solar expansion. Number one is increase profitability by 20% by increasing efficiency and lower cost of production. Also if you look at the projected product splits to 2040 shows a increase in renewables (solar/wind....). Good news is that Gas is also shows a significant increase too. This will help show why they are divesting in higher production cost facilities (North sea and US). Lubricants also play a big part in future growth profitability and that requires high grade low sulphur oil. BP will get around 6Billion this year on known divestments and this will be used for a variety of initiative from debt reduction to meting their second target of increasing production.
So I expect that this would include investing in new fields – Joint production sharing with SOCAR is also mentioned as a key focus. I suspect this will be expanded outside of Azerbaijan as they have a rather large bore gas pipe to fill.
I hope you and yours had a great Christmas and a prosperous New Year
I see a lot of speculation over what and what will not happen.
Cheesy still droning on about R6 knowing the score which indicates to me that he too must be ITK so one day he may get his point over and spill what he thinks he knows. I doubt that ZZ and SN know the final outcome so some random poster has the inside track is not something I would put credence in no matter how many points he would like to post.
What we do know and can observe
Silence from our board is continuing and I think will do so until the Arbitration is settled one way or another
GG have enough evidence to remove the FRR LTO without doubt citing failure to provide data, pay staff, hit their stated/optimistic production figure quoted in the Ukraine bid and demonstrate they are funded to be a going concern – yet they are still talking and engaged with our BoD – GG would win big if thy got rid of FRR and rebid the block (New money and not 400M to pay back from production)
Foreign countries are falling over themselves to bring Georgia into the fold and the US are putting agreements and laws in place to ensure Georgia’s sovereignty – this for a energy transit country that has all the required international transit agreements already in place.
FRR have a significant OMF debt repayment due in 2020 and the previous default interest payment to sort out (Texas case) or are they looking that the 5% left in the debt holding company will pay it off or the liquidators will take it all in fees leaving OMF with nothing (or a fight in the GG courts).
Will FRR be California dreaming or living a nightmare with their case due soon or is it?.
YA debt was due last year but nothing has be raised as an issue with that repayment plan.
FRR are still showing a flicker of life so lets see if the fat lady will finally get a chance to sing her song in 2020 (if she can still remember the words) and with it be a calibration or lament?
It seems according to Cheesy that only R6 knows the answer to that one - defiantly the silly season