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Many thanks to Chris for unearthing this latest info .
Some encouraging pointers to FRR still possible having a future in Georgia .
This comes on the back of the encouraging news for FRR we had recently that a settlement with Hope may be near .
So encouraging news on two fronts for FRR but will the final outcome be good news for us shareholders .
I want to be positive re the future but I won’t be holding my breath for a favourable outcome for us .
Why ? …..Hope has previously shown he his happy to cast us adrift / bottom of the pile and I fear any deal he is happy to conclude may follow the same line .
Personally, I'd be amazed if the O&G Agency/GG Govt trusted 'us' to get any job done enough to even think about allocating any additional tender to Frontera. I'd rather we just got on and flipping did what needs to be done for us to be communicated with direct as shareholders and hopefully, come out of this nightmare with a few pennies in our pockets. Going back to market on LSE would be a bloodbath upon opening, so again I'd rather a private deal being done as a private company or better still, SN can offer to buy our shares back off us!! I know, I sound delusional, but that's what I'd love for 2023 and for all of us to be able to move on without loss. GLA
'"Frontera" may return to the oil sector of Georgia' and 'The Oil and Gas Agency may announce an updated tender for the "Frontera" block.' This could also be that the tender for the 99% that's already been returned could go to Frontera. Frontera hasn't left the 1%, they have just not carried out any further work over the last few years. If a possible deal would greatly advance the production of hydrocarbons and it required Frontera to hold land adjacent to the 1%, it would make sense for the GG to allocate the tender of the 99% to Frontera.
To the point made by Avi8r - The GOGC clarified (In May 2020) that the "1%" referred to "the exploration territories located outside the existing Exploitation/Development Area. The allegations as if SAOG and GOGC were eager to take control of these exploration territories are thus nonsensical." making the "99%" the undeveloped / unworked lands.
well done chris572, and as we know, you do not fight over an empty box
When reading the document, all I would say is remember that the first half (up to “We remind you”) is new and the second half (to me at least) seems like a journalist’s retelling of old events for the benefit of his readers.
The first half is where we see all the positives, whereas the second half is the bit that regurgitates all our old problems. The journalist even gets it wrong when he mistakenly says “Finally, the government of Georgia made a decision to terminate the contract" which should have said “decided not to terminate”.
So to me it is a hugely positive post that Chris572 found and shared with us.
If I remember correctly, the 1% retained area contains the most valuable and productive part. That it is 'only' 1% is irrelevant as the size of that 1% is also quite considerable, so it seems more pieces of the jigsaw are being replaced/reintroduced and confirmation of what was understood previously now being provided, as Looed states.
Its positive on the basis that it delivers confirmation of the 1%, which based on data is lucrative, proves the point. Another positive step in the right direction. Combined with the pending legal arbitration 'Hope filing - "meaningful settlement negotiations"' dated 18 January with a 28 day deadline and a 7-day extension of the parties’ (22 Feb 23) respective briefing deadlines for Defendants’ Motion for Summary Judgment so that the parties can avoid further expenditure of their resources while they continue to work towards a mutually beneficial resolution (Looed 21 Jan) we should have a clearer picture end Feb, beginning March.
As all the little reveals occur, the wider picture becomes more positive. Lets continue to hope that includes a return to the LSE as promised by FRR not long after this sorry saga started.
Looed - I wish I could share your optimism. (:
To help me sleep better at night, could you elaborate further on the positives and consistences within this statement. I’m still seeing politics and games at play here and we still have no clarity on this 1% - I.e who owns it. Also, when I read this I still feel there’s a lack of constructive dialog between State O&G and FRR.
Things still feel fractured and, for me, only a statement from the company will provide confidence and clarity.
And breathe :)
Thanks Looed. That’s how I read it.
A definite positive imo.
Chris572 – many thanks for sharing.
A lot of positives and consistencies with company comments. But also some confusing comments that might just reflect the speaker talking very generally or variances in google translate. I will send to the translator and see if that version gives us a clearer understanding.
They are allowing FRC to get its act together which again mirrors what we know. I assume some of the debts outstanding are already being paid off by the State Agency working the “1%” in lieu of FRC.
One thing seems new - I think this is the first time we have seen the GOGC confirm the 99% has been returned, they lies and delaying of which ZM was able to manipulate to his own advantage / our detriment. That is a big obstacle now dealt with.
Thanks Chris572. I have just re read your post and to me it sounds positive. The American Frontera is still in control and wants to re-engage in oil exploration. That’s us! The Georgians seem to be saying that as long as we pay what we owe, then they want us back. Surely that’s good news.
FRR have shown to be completely incompetent and untrustworthy- fact.
Other companies seem capable of working with the Georgians- not FRR.
There maybe faults on both sides but right now I have serious reservations and issues with how FRR do business and manage relationships.
SN has a massive job to turn this around - if that’s his goal.
Cont. give frontera the land take a % and improve telations.
Yeah no doubt Georgian games but they're meant to be cooperating constructively. Tatishvili making sending a msg to frontera on the conditions. Yet, of there's nothing there why put US / Georgia relationship into jeopardy.
well in fronteras mind we dont exist and havent for four years so it wouldnt be difficult to do a deal that practically wipes us out
but it says weve found nothing in 20 years so still games being played although think id believe the georgians now
"When the liquidator entered this company, they had no motivation to work in Georgia. We will work until this situation with the American management of "Frontera" is settled and they make a decision whether to return or not,"
Is this where hope and FRR now have agreement, maybe hope taking a bigger share and wiping tge rest of us out. Sorry safa.
Not good reading, no mention of transfer to FRUS. Looks like they're still playing hard.
It means Dream are still in control of this nightmare.... :-((
So what exactly does it mean
Continued
According to the government's decision, the contract with "Frontera" was not canceled and it was given the opportunity to continue its activities in the part of the initial contract territory, where oil extraction was still taking place since the Soviet period.
It is about 1% of the exploration territory of the state, because about 99% of this territory has already been returned to the state by "Frontera" according to the arbitration decision.
"Frontera" may return to the oil sector of Georgia
Business 28/01/2023
The State Oil and Gas Agency may announce an updated tender for the "Frontera" block.
As the chairman of the agency, Giorgi Tatishvili, told "Business Partner", "Frontera" returned 99% of the license block according to the international arbitration order. It has the remaining 1%, where the oil and gas corporation operates.
"The manager company of Frontera itself is in liquidation mode." Rather than the process of liquidation, if the economic situation does not deteriorate and the oil is not spilled, this oil will be brought to the state in its entirety. However, at the same time, we are talking to the American management of "Frontera", who wants to continue the work here, but with the reservation that the conditions set by the arbitration will be fulfilled, because they have money to pay. So there is a possibility that "Frontera" will return. If this does not happen, the state will continue to work there," says Giorgi Tatishvili.
According to him, formally, the owner of the license is still "Frontera". We are talking about "Frontera" founded in the Cayman Islands.
"When the liquidator entered this company, they had no motivation to work in Georgia. We will work until this situation with the American management of "Frontera" is settled and they make a decision whether to return or not," says Giorgi Tatishvili.
We remind you that "Frontera" violated the contract of June 25, 1997 on the share distribution of products and the processing plant, which became the legal basis for terminating the contract. According to the decision issued by the arbitration tribunal, "Frontera" was ordered to return the exploration area (about 99 percent of the contracted territory) to the state and reimburse the costs incurred by the Georgian side in connection with the arbitration dispute (the total amount of payment obligations is about 6 million USD).
According to the 1997 contract, "Frontera" was supposed to carry out exploration work within 10 years in order to discover new commercial reserves of hydrocarbons and further exploit them. After this deadline passed without results, the company asked for an extension of the search term 2 more times, which was granted by the Georgian side. Accordingly, the total period of search has increased by 20 years. As a result of a 20-year fruitless search, in 2017 "Frontera" again asked for an extension of the search term for an additional 5 years and refused to return the search area. This was the basis for the request of the Corporation and the Agency to initiate an arbitration dispute at the Permanent Court of Arbitration in The Hague.
Finally, the government of Georgia made a decision to terminate the contract with "Frontera", which was explained in order to preserve the investment environment and taking into account the strategic partnership with the USA.
The big difference in this case is that a CRS doesn't rule out a criminal case under Californian Law. IMHO this is why the expert discovery date exceeds the negotiation date and could be FRR's trump card in obtaining a favourable result. This would also explain why discovery still hasn't been completed.
Thanks for a great post Sir.
I totally agree with your take on things.