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FRCC Liquidation Document dated 21st Jan 2020

lse:frr

#1

file:///C:/Users/PaulsNEW/Desktop/Frontera_Resources_Caucasus_Corp__nysbke-19-13418__0019.0.pdf


#2

Sorry above link corrupt !


#3


#4

Isn’t this the continuation of the legal due process in NY? Once the application was made late last year, this was always coming, so shouldn’t have been a surprise. But now we have reached this point, we do need to assess the implications. The court has approved what was requested (uncontested by FRR). So what does this mean? Well, it is giving more powers/access to the Liquidators to follow up all avenues to ‘trace & recover’ assets of FRCC. This also allows them to question Zaza, SN and Levan as part of their investigation. I say good luck with all that FTI/Hope. Plus, reaching Levan and Zaza could be tricky as they are not US citizens. Let the ‘goose chase’ begin, and during all this time, costs are being incurred by FTI; either Hope continues to fund that, or they will have to throw in the towel because money has ran out.

The bigger issue/risk remains on the Arbitration and this was evidently obvious with the Open letter to the Georgian PM from the US-House of Congress. And has it kicked up a right fuss. The PM has now officially responded from Davos, so let’s see where we go from here. But it’s clear that Ivanshivili is pro-Russian while the whole country is pro-West.

I have to also admit I am at a loss as to why everyone is fighting so hard to get the Block(12) back if it is empty (according to the Georgians themselves). So, if FRR is financially weak and at risk of losing the PSA, why would Hope not try to reach a settlement before it’s too late? Why is he still fighting so hard via FTI? Then you have the Georgian Govt who have hired some of the best lawyers to represent them at the Arbitration. Again, if FRR is weak, would it not be best for them to let them die slowly, rather than risk a political fallout with FRR?

On the PSA, I believe it was legitimately ‘farmed out’ - not transferred (big but subtle difference). If that is the case, then this required Georgian Govt approval. But if FTI are going to contest the farmout, then that could also be a long and costly process - roll out the industry experts.

On the Arbitration, my confidence is ebbing, mainly because of the ‘hard nosed’ approach taken by the Georgians but also by the exquisite timing of Senator Mullin’s letter (to put some pressure on the Georgians).

JMO


#5

Do anyone know/remember if the liquidation differs much from the last FRR company which was liquidated a few years ago?


#6

IrishPaul, Frontera Resources Holding Ltd was the original entity that issued the CLNs which was liquidated (back in 2011 if memory serves me right). This entity was essentially a shell company and therefore FRR was in strong position when it defaulted (i.e. no recourse to FRR or any OpCos). Subsequently, an agreement was reached and new notes were issued by Frontera Resources International, secured by share pledge over FRCC, owner of the Georgian sub holding the PSA - hence Hope liquidated this collateral. However obligor to the notes remains FRI (not liquidated), which is were the Moldova PSA is also held. So, Hope is in a far better position today compared to the last time with FRH. Lest we forget, the personal guarantees issued by the Directors secured by 500m ordinary shares in FRR. I think this is what Judge Kawaley meant when he said bionic.

All this will mean squat if the Georgians take back the Block.

FRR is getting attacked on two fronts by worthy opponents right now.

It wouldn’t surprise me if there is a tripartite collusion going on behind the scenes to bring FRR down (Hope-GG-Ruskies).

Interestingly no news from that important hearing held in Texas Court on the 9th January regarding the two PGs.


#7

Regdik on LSE:

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?


#8

DGfletters - FRR spent over half a billion dollars of other people’s money to get a dribble of oil and a nose full of gas out of the ground - they are not heroes - they are a laughing stock.


#9

Kalan
Top legal team is masterminding Georgia to loot FRR
If Georgia is clean there is no need to spend all this money
So please stay out