Company suing Gulf Keystone has specialist litigant funding

Company suing Gulf Keystone has specialist litigant funding Wed, Nov 21 14:34 PM EST LONDON (Reuters) - A company suing UK-listed oil explorer Gulf Keystone Petroleum (GKP.L) is being funded by hedge funds which specialize in litigation finance and two brothers involved in shipping, a London court heard on Wednesday. Gulf Keystone is locked in a battle to defend its ownership of giant oil fields in the Kurdistan region of Iraq after its former partner, a company called Excalibur, launched legal action claiming it is entitled to a stake of the assets. Shares in Gulf Keystone, a stock closely watched by private investors, closed 11 percent higher on Wednesday on speculation that the outing of Excalibur's backers could work in the company's favor in the lawsuit. Private investors pack the court room on a daily basis and post frequent messages on websites tracking the shares, hungry for a steer on how the case will affect a stock which has soared by 885 percent since oil was discovered in 2009. Analysts cited private investor speculation on websites that the disclosure of Excalibur's funders was positive for the company as the reason for the rise in the shares. Excalibur founder Rex Wempen said on Wednesday that his company had received funding to help it pay for the court case from New York hedge fund Platinum, and New York litigation funding specialist BlackRobe, as well as Andonis and Filippos Lemos, two brothers involved in the shipping business. One private investor speculated that the Lemos brothers could pull their funding for the lawsuit given that their backing of Excalibur had now been made public. The claimant was ordered by a London court to pay 9.5 million pounds as security for the defendants' costs before the trial started, and questions have been asked about how Excalibur, a small company run by Wempen and his brother which has few financial records, accessed such sums. Under questioning from lawyer Jonathan Gaisman, Wempen told the court that the law firm representing him, Clifford Chance, had introduced him to the Lemos brothers. Gulf Keystone, which declined to comment on the rise in its shares, has been touted as a takeover target for an oil major looking for a foothold in the attractive Kurdistan oil province but the legal battle is cited as an obstacle to any deal. The company said in October that it expected the court case to run for up to three months. (Reporting by Sarah Young; Editing by Mike Nesbit) ======= Author Bah Bah Black Sheep View Profile Add to favourites Ignore Date posted Monday 16:37 Subject ETAMIC: Look at AS, Listen to TK, Learn Votes for this Posting Voted 430 times. Message I've tried to make this brief ... ETAMIC. Ethnic Mick (you're a star, Coach!). So much speculation about 'who' was ETAMIC (including by yours truly). But I think we've been missing the point, the only relevant question is - not 'who' - but 'what' was ETAMIC. IMO. After living, and then reviewing the past years of this rollercoaster, I think I have now finally understood 'what' was ETAMIC. It's quite simple really, you only have to LOOK, LISTEN, and then most importantly, LEARN. That last bit can be difficult if you carry past pre-(mis-)conceptions in your head. And the following is only a summary of MY learnings, trying to stay with the facts, but still only MY OPINION - that may of course still be wrong. Caveat emptor as always. - ETAMIC arrival was announced in the RNS of 20th July 2009 "KURDISTAN UPDATE, AWARD OF TWO KURDISTAN EXPLORATION CONTRACTS AND A NEW STRATEGIC INVESTMENT PARTNER": http://online.hemscottir.com/ir/gkp/ir.jsp?page=news-item&item=181520350359769 - ETAMIC departure was announced in the RNS of 10th March 2010 "ETAMIC Announcement": http://online.hemscottir.com/ir/gkp/ir.jsp?page=news-item&item=362338473486026 - ETAMIC arrival is reflected in the PSC Contracts (for the Sheikh Adi and Ber Bahr licences) which were amended on 16/07/2009; ETAMIC departure is reflected in the PSC Contracts (for all four licences) which were amended on 01/08/2010 (http://krg.org/p/p.aspx?l=12&r=296&p=1). It follows from this that the ETAMIC 'duration' was pretty close to one year. - For the period of ETAMIC duration (circa one year), ETAMIC held a 50% equity interest in all of GKP's assets in Kurdistan. For the circa one year period of ETAMIC duration, there was no requirement for ETAMIC to contribute any funds whatsoever - their 50% funding obligation would only start "following the current drilling campaign on the two existing PSCs" (i.e. ETAMIC enjoyed a 'free-carry' on the drilling of both SH-1 and Bijeel-1). - At the conclusion of the ETAMIC period, GKP gained an 80% interest in Sheikh Adi and a 40% interest in Ber Bahr in exchange for $40 million in licencing costs (signature fees etc) together with an extra $12 million to pay for ETAMIC's 'one year of trouble' (my words). That was it. Do I hear 'what about the 40% tax'? Not relevant IMO - refer further discussion of this separate issue in section C6 below. - At the time of ETAMIC arrival (PSC's amended on 16th July 2009), the total shares in issue were 402,891,326 (http://online.hemscottir.com/ir/gkp/ir.jsp?page=news-item&item=181520350317644) and the share price was circa 12.5 pence. Giving a Market Cap of circa £50 million / US$80 million. GKP had NO CASH - they were already down to using the 'lender of last resort' (£30 million SEDA facility) just to pay for the costs of drilling the SH-1 well. So they would have needed to borrow a further $40 million - around HALF of the Company's MC at the time - to secure the SA and BB blocks. Company Credit Card? Or a 'lender of lastest resort' who would not only charge 30% interest for a one year loan ($40 million @ 30% = $12 million) but would also require half of the Company as collateral for said loan. Sounds about right, ETAMIC was simply a loan at Credit Card rates. IMO. Is the name of the lender important? I don't think so - the only relevant question is - not 'who' - but 'what' was ETAMIC. Those two additional blocks must have been really important (they were, refer section A) for the CEO to put half of the Company on the line at the time. He must have had great faith in his technical team and himself (he did, refer sections A and B) to risk everything for larger reward. I will go further, these actions define the very essence of 'entrepreneur' (wannabe entrepreneurs should take note ... and ask themselves if they ever came close to risking even a small fraction of their net worth on ANY of their 'Ventures'..). A. LOOK at Adnan Samarrai A1. Greater Sheikh Adi? There have been some references recently to 'Greater Shaikan' which I find rather curious - and to be frank, downright short-sighted and premature (sorry Ren!). It is normal convention to name an oilfield (or anything else for that matter) with respect to its largest component, e.g. London is not called Middlesex. Maybe that's a poor example, but I suspect that Adnan Samarrai might have labelled slide #14 in his presentation at the Iraq Future Energy 2011 Istanbul Conference on 29th Septembeer 2011 "Greater Sheikh Adi": http://core.theenergyexchange.co.uk/agile_assets/1514/1055_ADNAN.pdf because the main body of the structure shown in this perspective (the fattest, highest snow-capped red blob in the lower-left of the image) is in fact Sheikh Adi. One might even be forgiven for saying that it would appear from this image that 'Shaikan is a part of Skeikh Adi". Now where have I heard that before? I do believe it might have been our premier Court Reporter BiggerPicture (truly amazing reporting skills - this board is blessed by many talents - please keep it up!) in this post from 7th November 2012 titled 'Court Notes - Monday 5 Nov': http://www.iii.co.uk/investment/detail?code=cotn%3AGKP.L&display=discussion&action=detail&id=10161330 where the interchange related to 13th September - back in 2007! - as follows: "Email David Clark to Todd (13/9) – specifies areas we should push for JG – no circles on area map at this stage (Maps handed out to Judge and council at this point) JG – blue represents final block awarded. Gallikea – is Shaikan. Shaikan part of Sheikh Adi. Anticlines & block names stay same. Superimposed laminate pages over map, red objects on Mr Clark email above. Identifies current blocks." Adnan's slide #14 was in fact labelled "Existing Shaikan Wells and 2008 Seismic Grid". So the problem about Shaikan's likely lack of closure at the western end - which was already apparent just from surface observation back in 2007 - was confirmed by the 2D seismic survey that GKP performed in early 2008. A2. And Simrit too? Chronologically, the first truly revealing image released by GKP was slide #12 in the November 2009 Investor Presentation (that Todd also presented at the Global Energy Conference on 1st December 2009): http://www.proactiveinvestors.co.uk/genera/files/sponsor_files/gulfcorpnov2009.pdf I have posted many times about the potential implied by the above slide #12, the potential for connectivity between Shaikan and Simrit on Hunt's Ain Sifni block (in addition to the connectivity from Shaikan into Sheikh Adi, Al Qush etc etc). One attempt at description, (together with some other bits and pieces that seem to remain strangely relevant today ..) is in this post from 7th April 2010: http://www.iii.co.uk/investment/detail?code=cotn%3AGKP.L&display=discussion&action=detail&id=6183609 A3. Greater Ber Bahr? But Adnan's most stunning visual revelation of all concerning the potential mammoth size of the structure - in which Shaikan is just a bit part player - was the May 2010 Investor Presentation where eyes should be feasted on slide #14 - which is an expanded contour map view of the same data shown on slide #18 for the P1 filled to spill case assuming an OWC at -2230m TVDSS: http://www.gulfkeystone.com/uploads/gkp-investor-presentation-may-2010.pdf I have posted about this on more than one previous occasion ... the first was on 30th May 2010: http://www.iii.co.uk/investment/detail?code=cotn%3AGKP.L&display=discussion&action=detail&id=6413148 Need I say more? Well yes actually, I've heard on the grapevine that the OWC is in fact deeper than -2230m TVDSS ... no surprise really as, IMO, DGA got that part right (refer their OWC interpretation in their January 2010 Report). Was it really that long ago? And you can shush too Kandymans - all in good time, all in good time ... A4. The 'why' for ETAMIC should be glaringly obvious from A1, A2 and A3 above. ALL THREE of these seismic interpretations were made from the 2D survey that was acquired on Shaikan in early 2008 (together with augmentation from the 2D seismic lines that DNO previously acquired on Sheikh Adi & Ber Bahr, and most likely also some 2D seismic recorded by Hunt on Ain Sifni). The main point being that the mammoth size of the structures - and more importantly, the lack of closure on Shaikan at the western end - was already known to GKP by 25th June 2008 when they announced their preliminary interpretation of the 2D seismic: http://online.hemscottir.com/ir/gkp/ir.jsp?page=news-item&item=65115999808490 "The 2D seismic programme which was completed in April 2008 acquired 171 kilometres using a combination of vibrator and dynamite sources and satisfies the seismic acquisition obligation under the exploration phase of the PSC. A preliminary interpretation by the Company*s internal technical team of the processed data has confirmed the existence in the subsurface, at the depth of prospective reservoir zones, of the large anticline which is visible at the surface outcrop and is at the surface some 26 kilometres in length and 5 kilometres in width. The Company is planning to drill a well on the crest of the anticline for late 2008 to be drilled to approximately 3,500m. The well will target reservoir zones where oil has been discovered elsewhere in Kurdistan and northern Iraq, namely the Qamchuqa, Sehkaniyan and Kurre Chine. Other zones targeted by GKPL as having reservoir potential are the Chia Gara/Najmah and Chia Zairi. Based on the preliminary seismic mapping, reservoir parameters from analogues in Kurdistan and northern Iraq, and estimates of reservoir parameters made by GKPL personnel* GKPL estimates that should they drill a discovery well the five zones combined have potential unrisked in-place oil volumes of up to 2 billion reservoir barrels" The above announcement does of course NOT mention the issue about lack of closure on Shaikan or the likely connectivity between Shaikan and surrounding blocks (hello, the adjoining Sheikh Adi and Ber Bahr 'blocks' were at that time still assigned to DNO LOL!). But the idea of finding a way - any way - to secure the remaining 2/3 of the mega-structure sitting on the Sheikh Adi and Ber Bahr blocks must have surely 'come to mind' (to say the least)... A5. The 'when' for ETAMIC The discovery of live oil shows in the shallower depths of SH-1 (announced by RNS on 24th June 2009) was the required kick up the aris to implement the ETAMIC loan plan. IMO. The major risk that potential reservoirs in Shaikan may have lost their top seals was glaringly obvious from the surface oil seeps described in the February 2009 Presentation (reference the magnitude of these seeps on slide #20 and the seep locations on slide #22): http://www.proactiveinvestors.co.uk/genera/files/companies/gkp_one2one_compressed_february_2009_2_compatibility_mode.pdf The main point being that live oil shows indicated that Shaikan would contain 'something' - with the added potential that the up-dip part of the mega-structure on Sheikh Adi and Ber Bahr may well contain 'something more'. We still wait for the proof of course, but so far nothing is dis-proved. Which reminds me Tony, whilst I understand that you may have been side-tracked with too many problem 'beaches' of late, why is it taking so long to tell us more about the 300 metre oil COLUMN at BB-1? It is my understanding that pressure data is needed to define a "COLUMN" - do BB pressures 'measure-up' to Shaikan? I think the jury's still out Ren, so let's not tempt fate with a mere 'Greater Shaikan' - can we just stay with Kirkuk's Big Brother?: http://www.iii.co.uk/investment/detail?code=cotn%3AGKP.L&display=discussion&action=detail&id=5804969 So there you go, thanks to Adnan (and the rest of his team) the geotechnical justification for ETAMIC has become abundantly clear. Should it have been made clear to us (PIs) at the time? Most definitely not - protecting Company proprietary knowledge and maintaining competetive advantage is crucial in the oil business. FACT. B. LISTEN to Todd Kozel B1. Global Energy Conference Presentation on 1st December 2009 This conference presentation by Todd came just a few days after the famous CNN interview. The audience was .. more demanding. He did address the '10-15 billion barrels' from CNN, but was met with a hushed disbelief. He was asked directly about ETAMIC, but brushed it aside. These aspects have been discussed to death before. For me, the most revealing moment came when he talked about Sheikh Adi, the following was transcribed from the voice-feed: "We, fortunately… at the time I didn’t say it, but fortunately… ran a failed farm-out process for Shaikan, before we drilled this well. And I say fortunately, because we hung on to the half that we were trying to farm-out at the time. One of the difficult parts about Shaikan, and the biggest risk pre-drill, was there could not be closure to the West on the 2D Seismic. Once we got the information on the Sheikh Adi, we realised why. The closure is actually on Sheikh Adi, and actually spills over to the Ber Bahr licence area as well. This has the potential to be one massive structure. This we picked up with an 80% interest, so the KRG up-front has 20%. Just for framing our expectation purposes, we’re once again in the 1 to 2 billion range pre-drill, for this prospect. We haven’t drilled it yet, we’re in the bidding process for a rig for this. We hope to drill this well, May of 2010 is what we’ve got in the Bid Process. So, it’s an exciting well, this well tell us a lot about the extent of the structure from Shaikan." There are two important messages in the above, one loud and clear, the other somewhat subliminal. The obvious message is the reinforcement of what has already been covered in section A above - that the 2D seismic showed no closure to the west on Shaikan and the presence of a massive structure that extends through Sheikh Adi and on up to Ber Bahr. Todd's words chime with Adnan's images. The other less obvious message is contained within the first two sentences. In Todd's mind, he has 'hung on to' all the acreage - he has 'forgotten' that only 4 1/2 months previously, he had (allegedly) given half of it all away to ETAMIC! QED folks - in his mind, Todd knows that he has given NOTHING away. B2 CNN interview with with John Defterios on 27th November 2009 A few years ago, I would occasionally post some of my .. darker ... more controversial ... thoughts on the KOEP Private BB. Not because I wished to withold information from this public BB, but because I do on occasion enjoy being 'rather blunt' with some of my speculative thoughts - and I had no desire to end up in a Court of Law ... Furthermore, I has ASSUMED that I was amongst friends on KOEP; I did not even consider that there were people lurking there who might use my revelations against me (as in use my information to my disadvantage with regard to the value of my GKP shareholding). I know better now, but I would hasten to add that I do still regard *most* of the posters on the private Kurdistan Board - and indeed here on GKP BB - as 'friends'. Be that as it may, the following is an extract from a post that I made on KOEP on 7th February 2010 titled 'Was Mr 5% representing Mr 50% on CNN?': ====== "This started out as a quick re-view of the CNN interview, prompted by feedback from the Proactive Investor's presentation last week indicating that Todd was not aware the camera was running and that he thought they were having an informal discussion. I can only say that my opinion is the exact opposite; one does not have an 'informal discussion without cameras running' when it is with John Defterios in the Marketplace Middle East studios! Indeed, the discussion was clearly choreographed with regard to previously fed questions, e.g. "10-15 billion barrels", "managing expectations" and "cash injection": http://www.youtube.com/watch?v=jVXyfvPfC7M The last question referenced above is posed as "to actually produce this field then, you're gonna need a capital injection from a major oil company, you're gonna need about 120 million dollars over the next year". The specified cash injection amount is much higher than the 73 million dollars touted by Todd at the Global Energy Conference four days later (slide 25): http://www.proactiveinvestors.co.uk/genera/files/sponsor_files/gulfcorpnov2009.pdf Like a few others at the time, I was so blown over by the 10-15 billion barrels, that I kindly gave Todd the benefit of similar exhuberance, and accredited the discrepancy between 120m and 73m dollars as being down to Todd's ambition to buy more licenses or possibly the 15% third party back-in rights to Shaiken. But in the cold light of no financing news, I become more rational (pessimistic?) and examine page 25 in the above presentation with regard to how much Mr 50% will need to stump up over the next year: As we all know, he has a free ride on the drilling of SH-1 and Bijeel-1. His obligations are the same as GKP for all of the 2010 activities namely $19m (2 Shaiken appraisal wells) + $4m (SH-1 Extended Well Test) + $6m (SH-1 Production Facilities) + $12m (Sheik Adi well) + $10m (Shaikan and Sheik Adi 3D seismic). Let's give Mr 50% the benefit of the doubt and assume that his 'Overhead' is minimal (normal 'allowances' and 'benefits' are probably quite substantial and sufficient ..). So in total, Mr 50% needs to find $51m dollars to cover his obligations over the next year. Thus total capital injection for (Mr 50% + GKP) is ($51m + $73m) = $124m. Or "about 120 million dollars". Was Mr 5% also representing Mr 50% in his quest for capital injection from a "major oil company" in the CNN interview?" ====== My above thoughts reinforce Todd's subliminal message discussed under section B1 above - in his mind, Todd knows that GKP has to also raise 'ETAMIC's share' of the forward funding costs - because ETAMIC is very much a part of GKP! Btw CJ, you will note that I have only posted an extract from my KOEP post of 7th February 2010 - was it this post that ended up in the hands of the Hedge Fund? I suspect so, but you have never given me confirmation about which particular post of mine you were referring to. And while you're here, I'd like to congratulate you on your intel which indicated that the ETAMIC deal was designed for self-destruction from the very beginning. It kind of fits with what I've written in this post don't you think? But why the big negativity towards Todd - that should, surely, be directed at the lender? Finally, the most compelling evidence of all that ETAMIC was only a short-term loan arrangement: If Mr ETAMIC truly had any possibility of continuing to hold a 50% equity interest in GKP - would he have given it all away for a measly $12 million? Of course not. C. LEARN This section is directed primarily at myself. To see what I have learnt since this rather strongly worded post on 3rd August 2009 (three days before the Discovery was announced) titled 'Oil Discovered - But already 50% depleted': http://www.iii.co.uk/investment/detail?code=cotn%3AGKP.L&display=discussion&action=detail&id=5130567 First off, GRH1, regarding your friday post 'They took NO risk', thank you so much for selling me some of your shares on 3rd August 2009 (refer my last paragraph!). Second off, having re-read my post, I would have written the same again today - if the input data had remained the same. But it hasn't ... C1. Al Stanton, an analyst at RBC Capital Markets stated "the partnership with ETAMIC has halved shareholders’ exposure to any drilling success whilst retaining all the current financial burden for Gulf Keystone’s existing drilling program". RBC Capital Markets were GKP's House Broker at the time - there was a parting of the ways shortly afterwards. Were they correct? Yes, but only for a year. I suspect they may wish they still had GKP's business today. C2. The lopsided nature of the ETAMIC asset swap deal I think I summed it up pretty well with "ETAMIC must be ecstatic - they've got a bird and a very big bush in exchange for two small shrubs - and a free-carry on two wells to boot". I'd say the same again if my expectations were managed again with prospect sizes of only 32 sq km on Sheikh Adi and 45 sq km on Ber Bahr. However, based on Adnan's images, and GKP's more recent expectations that Sheikh Adi may be x0.5 Shaikan and Ber Bahr x1.5 Shaikan - I have the pleasure to respectfully witdraw my previous analogy. Managing expectations, maintaining competetive advantage, protecting priveledged data, avoiding a low-ball takeover - are perhaps all one and the same thing. C3. My expectations from the CEO My comments included "I'm surprised that nobody has mentioned the DNO relinquishment angle, and the recent rapid wheeler-dealering that has brought ETAMIC and two new small anticlines into the equation. Oil men make deals, this is what they do, this is their job. Of course GKP have been negotiating with regard to future pipelines to the north (wouldn't want to go south would we?). DNO's original Dohuk PSC area is shown on page 21 of the Investor Presentation February 2009. Their forced relinquishment of most of the Dohuk PSC area (all except Tawke in the north and the Summail discovery in the middle)is shown on page 6 of the Investor Presentation June 2009. Sheik-Adi & Ber Behar are two (of the three) blocks indicated as "OPEN" to the north-west of Shaikan. Our GKP oil men would certainly have been working hard on a deal to secure adjacent blocks to Shaikan (and Akri-Bijeel) that would (a) provide a low-cost pipeline hook-up to DNO's pipeline which will surely be built from Summail to Tawke, and (b) especially so if Shaikan is now known to confirm a major oil discovery so let's buy some adjoining small structures as well. If we believe GKP, the two new blocks were still "OPEN" in June 2009; a few weeks later and they are now owned by: GKP - NOT, ETAMIC! Did GKP oil men really screw up this badly on such an obvious deal?". If I knew then what I know now - I would not have written most of that. My apologies Todd - you DID get the Sheikh Adi and Ber Bahr blocks for GKP - albeit in an unconventional way... Well done even! C5. ETAMIC and 'Spelling out the Keystone intrigue' No new learning here for me, I stay with that proposed in my post of 3rd August 2009: E: Ewen (Ainsworth), Finance Director T: Todd (Kozel), Executive Chairman, CEO and co-founder of GKP A: Ali (Al Qabandi), Business Development Director and co-founder of GKP M: Mehdi (Varzi), Non-Exective Director I: Ibrahim (Al Khaldi), Vice President - MENA Region and co-founder of GKP C: Chris (Garrett), Vice President Operations But perhaps I can assist some of those confused commentators from Cess and the City .. Nearly two months after my post, the plagiarists at the Oligarch's rag attempted a new 'Standard' in 'Independent' (ha ha) thought (try googling those three words ..): http://www.standard.co.uk/business/spelling-out-the-keystone-intrigue-6726648.html What abysmal 'copy'. They over-looked two of the three co-founders of GKP, and instead proposed 'Adnan Sumarrai' (sic) and 'J(I)ohn Gerstenlauer' (even siccer - any abortion is justified to make a match?). I respond in the same vein as the other (deliberate?) mis-spelling in this journalistic masterpiece and suggest that these toss.pots should simply look at slide #6 in GKP's February 2009 Presentation: http://www.proactiveinvestors.co.uk/genera/files/companies/gkp_one2one_compressed_february_2009_2_compatibility_mode.pdf and consider that Ibrahim Al Khaldi was not only a co-founder of GKP and Vice President of the MENA Region in February 2009, but was also the Chief Operating Officer before being replaced by John Gerstenlaur on 1st October 2008: http://online.hemscottir.com/ir/gkp/ir.jsp?page=news-item&item=67111011509780 There can only be one COO at a time, so it is logical to assume that one of these two guys was 'not in the picture' (so to speak) when ETAMIC was conceived ... is it so difficult to guess the RELEVANT time period? I'll give you a clue - reference the announcement date of Shaikan 2D seismic results in section A4 above. I can only summarise my own ETAMIC learning experience as follows: Did ETAMIC spell 'Keystone intrigue'? Clearly not - it was what it said on the tin - a (loan) instrument that was owned by the Company. A loan that enabled Shaikan to morph into ... Kirkuk's Big Brother. C6. 'Infrastructure Capacity Charge' Whilst the precise terminology varies from Company to Company, e.g. from 'Capacity Charge' (Genel) through to 'Additional Infrastructure Support Payments' or the infamous '40% AISP tax' (GKP), the consequences are the same - the KRG has, in relatively recent times, introduced an additional levy which is probably best described as an 'Infrastructure Capacity Charge'. I believe that most of us first became aware of this charge in the ETAMIC departure announcement of 10th March 2010. But even then, I was not totally convinced that this was a specific ETAMIC-related charge because around the same date, similar levies were also being introduced for Longford (Chia Surkh), Vast (Qara Dagh) and Shamaran (Pulkhana). Since then, it has become very clear that most Companies operting in Kurdistan are now subjected to an 'Infrastructure Capacity Charge', albeit not all at the same rate. A recent summary of these charges appears on slide #13 of Western Zagros's Presentation: http://www.westernzagros.com/wp-content/uploads/2012/11/2012-November-WZR-Corporate-Presentation.pdf A few observations: - Most (but not all) Companies with Pre-Iraqi Constitution PSCs enjoy a zero or minimal Charge (DNO:Tawke, WZR:Kurdamir+Garmian, and Addax(Sinopec):Taq Taq). The exception is Genel who appear to have accepted a blanket 30% for all of their licences. - Some Companies appear to have been able to negotiate a lower charge in return for an up-front 'Entry' payment (Hess:Dinarata $140m, Repsol:Piramagrun $65m, KNOC:Sangaw South $$$$$!). - Most other Companies are paying 30%, 35% and then GKP at 40% However, Western Zagros have been a bit naughty with the sub-set of Companies used in their comparison! Reference should also be made to page 17 in the following: http://stocktalk.no/Upload/%7B63199%7D-Macquarie.1-30.pdf Whilst much of the content within this note is far from balanced, the Table on page 17 encompasses more Companies and blocks than the WZR summary - to reveal that GKP is not alone with 40%. Check out MOL with 40% at Akri Bijeel! And there's even one - OMV at Bina Bawi - with 45%. So why the disparity in Infrastructure Capacity Charges? It seems logical to me that blocks containing 'heavier' oil should be subject to higher infrastructure capacity costs - to reflect the real extra costs of sending heavier oil down a pipeline all the way to Ceyhan (additional pumping stations, possible need for heating, pipe insulation etc) compared to light oil. So the range of charges from 30% to 40% as a function of oil quality seems reasonable. Furthermore, I don't agree with Macquarie when they suggest that the PSCs which currently enjoy zero/very low charges will be 'harmonized' going forward - they appear to overlook the legal significance of a Pre-Iraqi Constitution contract (that one's for you Ren). Time to call it a night (and a day). All IMO only - apart from what Adnan saw, ... and apart from what Todd said. GLA, BBBS P.S. If somebody out there is looking at Picken a fight with Todd (and his baby!), the response might be - "Do anything. Roast me. Skin me. Eat me. 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Petroquest - 14/10/2010 •Taq Taq ◦PSA - Genel Enerji - 20/01/2004 ◦PSA - Genel Enerji - 21/11/2006 ◦PSA Annexes A, B, C - 21/11/2006 ◦PSC - Genel Enerji/Addax - 26/02/2008 ◦First Amendment Agreement - 01/08/2010 ◦Taq Taq: PSA Attachments - Genel Enerji - 2002 ◦Taq Taq: PSA - Genel Enerji - 2002 •Tawke ◦PSA – DNO – 25/06/2004 ◦PSC - DNO - 13/03/2008 ◦Confirmation Agreement - 10/09/2008 ◦Indemnity Agreement - 10/09/2008 ◦Amendment and Relinquishment Agreement - 10/09/2008 ◦Assignment and Amendment Agreement - 31/03/2009 ◦Border Adjustment Amendment - 30/07/2009 ◦Sixth Amendment Agreement - 01/08/2010 •Taza ◦PSC - Oil Search/Shamaran - 27/07/2011 ◦Guarantee - 27/07/2011 ◦Shamaran LOR - 27/07/2011 ◦Oil Search LOR - 27/07/2011 ◦Amended K42 Option Agreement - 28/08/2009 ◦Oil Search K42 Option Agreement - 16/07/2009 ◦Oil Search K42 Option Agreement PSC Annex - 16/07/2009 •Topkhana ◦PSC - Talisman - 19/08/2011 ◦Option Agreement - 19/06/2008 ========== Author BiggerPicture Date posted 2012-11-07 00:10 Subject Court Notes - Monday 5 Nov Votes for this Posting Voted 81 times. Message Court notes - 05/11/2012 Usual caveats apply: Everything I report on below is subject to my own fallibility. Taking notes, whilst listening and not being legally trained could lead to any number of mistakes in my account below both in the essence and my understanding of the events in court today. Where it’s my own opinion I’ve mentioned it. I’ve also tried to include some exchanges word for word verbatim to give you a flavour of proceedings – again these may not be exactly correct, only the court transcript could be used for that purpose. Finally, a lot of it I have documented ‘as it happened’ rather than my reflections from the day – hopefully some rich material to pick over. Please read together with other attendees accounts to fill in gaps or add more meat to the bone. Please double check and cross reference names, dates etc I hope that the notes are helpful for the majority of shareholders who can't attend these proceedings. I plan to attend the majority of court sessions where possible and will supply my notes in good faith. If anyone feels they want to chip in to help cover travel costs drop me an email at madiba201@gmail.com. ----------------------------------------------------------------------------------------------------------------- I was 10 minutes late, so missed the 1st bit Rex in witness stand JG questioning Rex – several discussions what good area was, day or so after meeting, not sure significance immediately JG – focus on Asthi agreeing to assign to consortium in meeting on 31st. If Ashti agreed in meeting, why didn’t Ashad tell you straight away? Rex – recall we spoke, significance only realised week later JG – 2 questions - Ashti agreement to reward – did Ashad report on that day? - Geographical significance Rex – recall after day or 2, more detailed discussions week later Email Ashad to Rex – ...found good area... JG – relates to Derma Dagh and Perma Dagh Rex – not really understood JG – not clear what area was, you didn’t know, did you? Not clear Shaikan allocated to consortium Rex – Ashad claim good area for us JG – no sign email says this Email Rex to TK 2/9 – describes meeting – Ashad is convinced found good area, but know how it goes... JG – not showing confidence Rex – agree it was lucky what Ashad did here. Underground survey June trip JG – didn’t go on Shaikan June trip? Rex – no JG – KRG wanted geologist, no mention of area Ashad found Rex – sorted out map afterwards JG – will go through order of events Rex witness statement – given progress by Ashad, next step Todd to meet with Ashti to discuss detail... Email Rex to Kinear – Todd is wasting time, any way to speed up, need to move to closure in Kurdistan JG – how is it area is not defined yet you showed sceptisism, you were being impatient and unreasonable Rex – wanted to move forward and capitalised JG – you wanted to move forward without any geological expert data Rex – email sent by mistake Email Rex to Todd – deal should be done, you have reserved blocks... JG – still no geological reports done , what are the reserved blocks here? Rex –areas we’ve become familiar with, don’t know exactly JG – block not same name as structure, do you understand this? Rex – Yes JG – what were the reserved blocks, focus on meeting. Dermeer Dagh & Permeer Dagh blocks – are they included or excluded? Rex – minister wanted to commit to producing & exploration block JG – Was Dermeer Dagh one of them? How many was there? How many were reserved? What was included? Rex – Ashad talked about ‘worms’ plural, can’t say what turned out to be JG – don’t worry, taking this chronologically TK witness statement – Rex overambitious...not realistic what could be done. Rex never seem to want to tick all boxes. Silly, no deal despite what Rex was saying, no sign of a deal. JG – any deal better than none JG – all that happened KRG made DNO give up certain areas Rex – minister came to some agreement with Dabine JG – still don’t know area Rex – didn;t know detail at time JG – when did you understand Ashti agreed to give certain areas to consortium? Rex – became clear after JG – so by 7 Sep, what were they (blocks)? Rex – didn’t specify blocks at this time, yet to be determined JG – why didn’t you tell Todd Ashti agreed blocks to consortium? Rex – trying to convey in context to what was happening JG – unlikely Ashad to apply value to blocks at this point Rex – value only became clear after years TK witness statement – Rex suggests Ashad identified potential...was Adnan’s expertise that determined... Rex – hypothetically agree JG – will see who identifies structure later JG – remember sending email done deal? Rex –yes JG – terms of deal unknown, how possible without law? Rex – Taq Taq awarded, other companies working on deals at time JG – you aware Ashti said no deals until new law (as determined last week). Did the already done deal include Deerma Dagh? Did or not? Rex – ambivilant what included. Excluded and was separate – option for consortium to have. Ashti keen for someone to take up Dermeer Dagh Email Rex to Franchie – we have 2 options, producing field & exploration block, for which we need signature bonus Franchie reply – good news, proven field easier to get funding for (Dermeer Dagh) JG – Shaikan was riskier option, Franchie not optimistic Rex – he stayed involved JG – agreed he put you in touch with Lazard Rex – couldn’t do more because we didn't have recognition letter JG – how in touch with Lazard then? Rex – because of previous work Email Rex to Kinear – Done deal, cause TKI US company. Afterwards will flip to Gulf. All Todd has to do is sign deal. Delaying will kill deal. Minister liked them. I rescued block for them.... JG – clear you wanted Todd to sign commitment Rex – Yes JG – on what terms? Rex – hoping Todd as expert would get favourable terms for consortium JG – for unidentified blocks at this point? Rex – general area identified JG – not same as block is it? Impatience, ridiculous wanting Todd to commit at this point Rex – aware other companies circling, wanted to take advantage of opportunity Todd witness statement - ...showed lack of understanding how oil deals are negotiated.... Rex - wanted to take advantage of opportunity JG – you understood would be signed by TKI initially alone? Rex - understood at time JG – consistant with TKI part to CA Rex – Todd was part of consortium JG – main function to prepare bid Rex – common goal to get acreage JG – TKI only Rex – could be assigned Rex email to Kinear – everything could come down to next 48 hrs JG – you were in paralel universe to reality Rex – was anxious to move forward as quickly as possible Rex email to Todd (14/9) – have you been able to look at map to identify block? JG – you didn’t know which block at time Rex – David Clark spoke to minister who spoke to Dabine about areas who relayed to Todd... JG – idea Dabine got agreement is nonsense Rex – disagree Email David Clark to Todd (13/9) – specifies areas we should push for JG – no circles on area map at this stage (Maps handed out to Judge and council at this point) JG – blue represents final block awarded. Gallikea – is Shaikan. Shaikan part of Sheikh Adi. Anticlines & block names stay same. Superimposed laminate pages over map, red objects on Mr Clark email above. Identifies current blocks. JG – Mr Clark didn't need Ashad intervention to work out Rex – disagree JG – you say consortium wouldn;t have had blocks if not for meeting between Dabine & ministers Rex – yes JG – you then send map to Ashad Email between Rex Ashad – suggest Clark work out areas for himself Rex – not what I’m suggesting, this is follow on from discussions between minister, Dabine & Mr Clark JG – why would Ashti commit with local agent with no geological knowledge? Rex – agent represented consortium JG – look at map, vague area highlighted by Ashad, covering large amount of terrain. Info of no technical value to anyone. 18 days after meeting – 1st sign Ashti committed to any blocks Rex – were talking up contribution, turned out to be significant Rex witness statement – Ashad (Dabine) pushed Ashti to assign blocks JG – exaggeration by Dabine Rex – no doubt in work JG – not realistic scenario Reference to Rex letter to Ashad (22/9) – .... (didn’t get this bit) Rex witness statement – David was pleased with area Ashad identified Email Rex to Clark (17/9) – area Ashti verbally committed to Rex – I was excited David Clark reply – encouraging that Ashtim wholly committed, corresponds to structures identified by us JG – doesn't suggest areas identified by Ashad Rex – believe Ashad pointed in right direction, David zoned in Reference to Rex witness statement JG slightly over-egging Dabine contribution Rex – played decisive contribution JG – beginners luck according to you Rex – could have been lucky, but worked Reference to TKI letter to KRG 26/9 meeting in London – Dr Ashti at Gulf office JG – claim had to step in to patch up relationship (Rex Witness statement). What was problem with relationship? Rex – Ashti disappointed not stepped up made bid for Dermeer Dagh. Dabine stepped up JG – credit to Dabine Rex – I was directing traffic JG – Ashti knew Adnan/Todd, idea didn’t want to meet fantasy land JG – accused Ashti of lying Rex –though miscommunication, you’re mischaracterising me Email Rex to Ashad – he lied to you... JG – frame of mind on 22/9, Ashti playing games, being tricky Rex – need to get a move on Todd’s witness statement meeting in London – no agreement by Ashti to offer anything at meeting Rex – not how I understood it Reference to email (not sure who) – no indication of any agreement with minister JG – you’re inclined to over optimism Rex – think I’m realistic. As entrepreneur wouldn’t get far without JG – define entrepreneur Rex – lead, define team, bring in experts, identify opportunities, brings everything together Reference to some letter from TKI to KRG Email Rex to Kinear – heard good news? JG – what was good news? Rex – in context positive meeting on Kurdistan JG – which one? Rex - 31/8 meeting Dabine & minister. General agreement for consortium on area JG – representing hope/aspiration as fact Rex - was optimistic JG – you should have been busy getting funding Rex – was waiting for deal Email Talal Ar Hareed to Rex – Rex should assist raising $50m for Sharia compliant bank in Qatar Rex accepted terms Rex – talked to David Dassy at Goldman Sachs who took pass Rex email to Eric (UBS Tax attorney at time) – if you know where to find capital partners, please help out JG – already accepted undertaking not knowing where/how to get help Rex – bank was formed JG – not because of you? Rex – no Email to John Allen (Lehmans) – one of our projects Bank in Qatar. Found oil in Kurdistan... JG – hung in coat tails Rex – mischaracterisation JG – no reply from John Allen? Rex – No Email Rex to Todd (putting pressure of TKI) – do you have appointment to sign contract yet? JG – what contract? Rex – my way of asking progress Todd reply – patience is a virtue JG – consortium had to wait for geological assessment & contract, right? Rex – yes Email Rex to Todd (04/10) – goal is to have signed before they take final oil law to parliament JG – you said you know nothing would happen until law signed (last week) Rex – ... (long answer, didn’t get) Todd witness statement – Rex experience was telling... Rex – agree, that’s why brought Todd in JG – your position, never mind terms, we will raise money, lots of chasing emails Rex email to someone – Is Todd dead? Do we need another oil company? JG – delusional to think you could continue with another company Rex – didn’t have a lot of options at the time Rex email to David Clark – confirm signing contract this weekend JG – which oilfields are these? Rex – some email problems JG – which lawyers? no indication proposal accepted. You propose deal signed with no details Rex – mischaracterisation Rex email to Ashad – Business discussed – Sherkil housing project, cement, tuna, securing oil refinery... Rex – was in position didn’t feel I could say no to Dabine. Made general enquiries on his behalf Email Rex to Kinear (25/10) Iraq project, Congo, Uzbekistan... Need to move forward...other opportunities out there...my partners & I scheduling fundraising... JG – who are partners? Rex – Dan Franchie, David Helpet JG – no records, how many fundraising taking place? Rex – may well have been none, was having conversations JG – leading Kinear up garden path, idea had partners, fundraising not true Judge – what is Kinear’s business? Rex – supplying fuel to troops etc (petrol/diesel) JG – your position Dabine’s fault no PSC signed at this point Email Rex to Ashad (6/11) - ...we send you our offer....please send us PSC now....we can bring refinery/powerplant, all the tuna in the sea (impatient & rude email) Rex – we were brothers in arms so to speak. Looking for model agreement JG – why blame Dabine for it? Rex – trying to motivate Ashad to get agreement from minister Judge – why accusing Dewari (Dabine) at this point? Rex – can’t recall, we were told not moving quick enough JG – not realistic Rex – trying to get doc in hand of Todd so they could make formal proposal Email Ashti to Todd PA (22/11) – please base proposal on Shaikan and....should contain signature & production bonuses Forwarded to Rex on 24/11 JG – aware of signature bonus now? Rex – Yes JG - aware 30 days from signature? Rex – agree JG – at least $10 – 15m, each area or both Rex – looks like both JG – so had to find at least $3m in short order, confident? Rex – if had correct docs, yes Todd witness statement – Rex suggested he could come up with share of money Rex – yes, Todd was aware of our fundraising model JG – Gulf never understood Exc had indefinite carry of libor +2% until later. You didn’t tell them Email exchange between Wempen brothers (Feb 07) – (fund route argument) We need a fund, not up for continuing on deal by deal basis JG – discussing best option of financing – how to finance projects – fund or deal by deal basis Rex – saw positive aspects of fund JG – Eric say it will create extra problems Rex – I had no experience JG – can you see difference between deal management and fund management? Rex email to Eric – these guys need a fund too and we will lose them if don’t do something JG – who are these guys? You’re saying partners supportive of fund idea? Rex – Ian Kinear JG – truthful to brother? Need fund or will jump ship? Rex – Yes JG – suggest continue with broken record of failure Email Rex / Eric - ...terrible fact we will face capital call when deal closes... JG – shows you were alarmed by possibility deal would require cash call Rex – realised we had to move along JG – if Exc was party to PSC, would have direct financial impact. You thought you had indefinite carry Rex – would have signed JOA JG – you realise ability to raise finance was issue that’s why said ‘terrible’. What capital call did you envisage? Rex – according to terms of JOA JG – ‘we need some back-up’, what does that mean? Rex – wanted to have some money JG – you told Mi Lord you didn’t need money at time, so why did you need to raise money at time? So you did try to raise funds before signature of deal? Rex – yes, did try, but because of risk nature of areas, were advised to get deal first LUNCH JG – why did Exc not disclose email trail to trial? Rex – disclosure from UBS or Exc? Assume we did not have it Fuel Handling Systems (FHS) – Kinear’s business Email – we need backup, UBS needs to come through (Feb 07) Rex – looking to get UBS JG – backing means funding, doesn’t it? Rex – yes JG – only reason UBS mentioned because Eric works there. Complete non started that they would lend/finance exploration project Rex – no bank would have JG – you confirmed you were looking for funding Rex – brainstorming with Eric here, with Kinear JG – what did Kinnear know about oil exploration? Rex – brothers exchanging ideas JG – what do you understand about Eric email saying funding is the hard part Rex – brothers didn’t always agree JG – Eric was saying “good idea to start with small deal”. You stuck with fund idea, Thames Chesapeak until much later. JG – what was period of fundraising effort? Rex – roughly to early Apr Email Rex to Kinnear (Apr 07) – revise agreement to put Gulf in place of TKI. To raise fund need to demonstrate solid agreement in place, prove operator with international oil company. In position now to raise fund, need to capitalise on it.... JG – still on fund idea Rex – yes, for next 2 months JG – specifically for oil company? Rex – to raise fund of current Kurdistan situation Email Rex to Ashad – I keep telling Todd to be patient...slightly curious what’s going on myself...believe you’re in contact...Todd’s board giving him a hard time to close deal...our investors doing same to us.... JG – you were impatient, not Todd. Todd never told you about any demands from GKP board. ‘Your investors’? Another fib. You just making it all up to motivate Ashad Rex – was my understanding JG – did you have any investors? Who are they? Rex – referred to my network, Franchie, people he knew, had position with Rolodex (?), David Helpet JG – why did you never approach David Helpet? Rex – didn’t have deal JG – come on mr Wempen. He was oldest friend likely to fund. Idea you didn’t contact because of title was a lie Rex – wasn’t JG – idea everybody was giving you a hard time, who were they? Rex – Mr Franchie JG – no he wasn’t, he was CFO, part of your team. Another fib to Ashad to motivate him Rex – could have said differently JG – chicken of sea project, oil trading deal from Qatar (QTC), how much money did Exc made out of this? Rex – no oil produced, no money made Rex email to Kinnear – very significant opportunity to win concession... Eric witness statement – in 3rd world business deals brokers peddlers of influence.... Some reference to emails I didn’t get JG – looking for buyer before doing any due diligence Rex email – be persistant, can’t afford to burn bridges at home... Rex – had NDA with UBS, can’t remember JG – things getting a bit murkier Rex to Kinnear – Talleb (?) key man, decision maker, most important he doesn;t find out your lack of knowledge... Email from Scott (Rex MBA classmate, experience in oil trading) – don’t understand how you are set-up.... Can get someone to draw contract up.... Will do on trust, but don’t know your set-up. ... You have no knowledge of oil business... Next meeting UBS Email to Steven Soule (UBS) - please find attached NDA... (QTC deal, UBS potential buyer) Kinear email to Rex – excited about above deal, suggest ditch Gulf Keystone.... Rex – certain he is joking Judge, who is ‘he’ in this email, was deal to buy gas? Rex – Talleb, yes JG – signed broker agreement with QTC – they were intermediary. 17 Apr UBS sign NDA Steven Soule email – looks like we’re in business JG – meanwhile you had no idea of Talleb, who he was etc, no due diligence Judge – where was oil to come from Rex – Qatar, didn’t work out Rex email after UBS NDA signed – ask Talleb to send me his bio JG – so no DD before NDA? Problem now because UBS interested Email Rex to Kinear – having investor meetings in NY this week, same people buying oil id raising our fund JG – people buying oil is UBS, what you are telling Kinnear UBS is raising your fund. UBS has signed NDA, they are buyers, who was raising your fund? Rex – nobody at this point, inaccurate JG – if isolated, understood, but time after time same pattern, fibs Rex – marketed pretty ambitiously. Ian knew where we were JG – Kinear would have thought it was reference to UBS Rex – we also talked on the phone, he understands what’s going on here JG – can’t do this all the time saying what’s in email is not what we discussed JG – what did you have to offer Todd, other than Kurdish deal? Rex – ask Todd JG – I’m asking you Rex – certainly interested in Kurdish deal Judge – confused with QTC deal (mr Talleb’s company), Russian or Qatar? Was Qatar deal ever put in writing? Rex – may be some emails JG – only intermediary agreement Email Rex to Kinear (25/04) – no bio... did you receive corporate profile yet....save my skin JG – UBS breathing down your neck Rex – yes Rex email to Kinear – in real bind here, need help from your side, UBS daily asking me for more info JG – oversold deal again, can’t answer basic questions on person supplying oil Rex – was large deal JG – the bigger the deal, the more careful you should have been Email Rex to Eric – ...stop focussing on camel jockeys... (Gasps from gallery) JG – derogatory view of Middle east Rex – Eric married to Arab lady Email Rex to Kinear – need to know who he is...claims to be sheikh with special access.... (missed the rest) Email Rex to Kinear (30/4) – nothing from Talleb....deal off table....extremely embarrassing JG – at this point start to do DD on Talleb Email Rex to US Dept Commerce (02 May 07) – trying to ID and verify Talleb, all we have to go on is tel nr and email.... Answer back – never heard of him, doubt ability of anyone backing this deal JG - Moving on to subject of parties of CA – your understanding Rex email to Todd (22/2/07) – let me know if you want to use GKP in Iraq... jG – clear understanding you dealing with TKI Rex – no, Todd was interchanging companies, in context of 2 proposals/presentations Email Rex to Kinear (24/01) – we signed a deal with TKI who will have to be expanded to include GKP... JG – logic you dealing with TKI, can you fault logic? Rex – we’re looking at global oil fund idea, we’re doing global sourcing JG – you signed deal with TKI, unless and until GKP included way to expand would be to include GKP/ So prior to expand doesn’t include? Rex – right as matter of language. But don’t agree in context – concept included GKP Judge – surely should have said signed deal with TKI and GKP and expanded to include other concepts properties beside Kurdistan Rex – might have been better JG – wrong to say dealing with Gulf from outset Rex – TKI initially, US flag JG - Jan 07 – discussion with Todd about Gulf taking over Kurdistan deal, remember? Rex – no JG - does this jog your memory ? Rex Witness statement –- 26 Jan email – we spoke and Todd explained having difficulty with board to transfer deal to Gulf... Rex – right JG – also aware of political issues at Gulf?, Also aware Gulf under offer? Rex – yes JG – your reaction Email Rex to Todd – don’t sell GKP before we close this deal... Email Rex to Kinear (11/2) – put Gulf in the lead... 15/03 receive agreement assignment TKI to Gulf (whole of TKI 70%) – proposal draft assignment Rex reaction: Email Rex to Kinear – let Ali put pressure on Todd by not transferring TKI to Gulf JG – you were unwilling to partial transfer to Gulf, thought your interest at risk being replaced by Arab consortium Rex – was concerned JG – your idea at time was to keep agreement with TKI alone Rex – yes Email Rex to Eric (21/03) – (sets out draft email to send to Todd) – I was not averse with partial assignment to Gulf by Texas... Kinear email to Rex – meeting with Gulf board... Rex email to Eric – Ian had meeting with Gulf... (very funny email, shows impatient Rex) Kinear reports – meeting went well...don’t agree with any transfer....do not agree with name change on agreement Rex – no objection with partial transfer, They asked me to do a favour JG – not Gulf asking, this is Kinear. Kinear saying would be disastrous if Arabs Rex – happy with 99% transfer, as long as US flag JG – how would this stop Arabs showing up in Kurdistan? Rex – up to Gulf JG – likely to come about if 99% transferred Rex – Gulf understands issues at hand Email Rex to Kinear – we should keep deal with Texas if at all possible... JG – you & Kinear suggesting to keep US flag, nothing to do with doing Todd favour. You were resistant to Gulf getting involved Rex – they were completely involved, branding issue here about US operator, didn’t want to throw aboard Rex email to Todd – please keep this deal at Keystone, highly suggest you keep bid at Keystone, wit until after deal is signed before transferring to Gulf JG – you unwilling to assign 100% Rex – Yes Email Kinear to Rex (5 Apr) – did you send letter saying NO to change from Texas to Gulf? Rex meet Todd at JFK – agree to send further letter about change Reference to Thames Chesapeak Term sheet – pitch page JG – remember saying no need for Texas (brand) ventures outside Kurdistan? Pitch – one public partner – Texas Keystone Inc – single identified partnet JG – why didn’t you include Gulf here? In pitch doc? Rex – possibly because of turmoil of RAK acquisition JG – would not have impact on fund, would it? Rex – no Letter Rex to Todd (after JFK meet) – do not approve transfer of TKI ownership right to Gulf, non US entity Rex – doing Todd a favour JG – purport to refuse transfer (partial or total), trying to help yourself & Todd, you wrote something not true in this letter, confirm? Rex – Yes JG – did you say anything in letter you believed at time not to be true? Some discussion again about OPEC insurance JG – point you make about Opec insurance requires consortium to be 100% or 99% US owned 5/6 May emails to be covered tomorrow (Tue) Hello from Phonm Penh, Cambodia. Hope everyone's playing nice. Gulf Keystone (Buy TP 248p) - Meeting with the CFO. Positive. Despite the court case with Excalibur that is currently taking the headlines, we draw attention to operational progress that continues to be made across all four of Gulf Keystone's PSCs. Exploration/appraisal drilling at Akri-Bijeel is ongoing ahead of a potential disposal; it is likely that a re-test of the 300m oil column at Ber Bahr will take place in the months ahead, at least two more appraisal/exploration wells will be drilled at Shaikan and the production facilities upgrade is progressing at EWT-1(Extended Well Testing) (PF1) and is expected to be complete early February 2013. Elsewhere we anticipate Shaikan FDP" Field Development Plan" to be submitted around the end of January and EWT-2 (PF 2) to be completed by mid-2013. It was indicated that the process to move up to the Full List will likely take place once the financial accounts become unqualified following removal of the uncertainty surrounding the law suit. We retain our buy recommendation and 248p/sh target price - Simon Fisherþ@simonfishybits SP is now using a new language with TK for the 1st time I have heard him say "May I ask you a straight forward question" Judge Clarke cuts SP short "you have said this several times about privilege docs it's true but uninteresting" SP "I will stop saying this" === oh no - here we go again! It's like ground hog day just 12months on. The trouble with satellite images (as GRH-1 knows very well) is that they may well look great up above but when you get down into mother earth herself - the story is quite different. In fact as we have found out with the likes of BB and SA - recovery/flow rates is far from simple. WZR recently provided results on K2. The well should have been gushing 7k bopd minimum imho. But the wrong casing, and the issue of 'GAS' prevented them from gaining such rates. As we know - GKP have struggled with production as gas problems and varied api has caused headaches on local sales. No one is saying it's easy peasy to extract the stuff, but as the problem of recovery becomes common place in Kurdistan - thus the need for many appraisals increases. If GKP was sold tomorrow - then Shareholders would be short changed on SA and BB. No buyer will pay a decent price based on nice colourful pictures lol! Nor will they pay a fine price based on BBBS's posts. Shaikan will have 8 wells drilled soon and that certainly goes a long way to showing what the structure has across a few km's. But operational data on production is still in its early days. The EWT's need to be running 40kbopd for a long time without hiccups to convince a buyer to pay top wack. The likes of DNO and Genel have years of production data/proof of performance. GKP do not. When JG says 30% to 35% recovery possible - he's looking well beyond the immediate future. It will take years to prove that kind of recovery factor - not months. Most wells will run with recovery factors of say 30% from day one yet decline quite soon after to nearer 20%. We've all been through the 'images' and 'exxon £8' and the excitement that followed from around Dec last year to March this year. Do we really have to have more ramptastic 'image' posts, cryptic posts, and big number posts? Surely a bit of 'balance' would be smarter this time around. Some seem to be desperate to spin the 'old' stories - why not just let nature, GKP and the market do it's thing and let it take its course? HUB ======= Subject Re: Can 'commercial' crime pay?>Sicilian_K Hi Sicilian_Kan, As always, I very much appreciate your posts and the valuable legal perspective that you introduce to many issues that few of us fully understand. On this occasion, however, I continue to see the situation highlighted by this case very differently to you. And while I am ‘emotionally involved’ due to having a high proportion of my finances invested in GKP, I do not believe that my post displayed much by way of ‘emotions’ at all. As Jack Diamonds highlighted recently, the Excalibur case was voted on by members of the legal profession as one of the 20 most important cases of 2012…. and that was way back in January I believe. Now, I think we are beginning to see why it warranted such a high level of recognition. I take the view that its importance lies NOT in the fact that it is ‘little’ Excalibur v ‘big’ GKP, but because it highlights issues that concern, if not the average man in the street, certainly a large number of shareholders and commercial businesses in this country. Imagine, for example, that a vexatious litigant could prevent a small business owner from carrying out his normal activities, and succeed in ruining that person’s business as a result, whether or not the verdict of the judge was in his favour. That possibility would surely need to be addressed. In this instance, it is perfectly conceivable that the difference lies only in the scale of the business involved and the number of its shareholders. Hopefully, Judge Clarke will be able to deliver a judgement that affects not only GKP but many other potential claims of a similar nature... irrespective of size. You comment “I understand emotively how it can seem unfair that someone can bring a claim that adversely affects you and if turned out not to be proven, you have no right to a remedy. But the alternatives may merely create injustice elsewhere and possibly more injustice.” While I accept that it would indeed be perfectly possible that a Judgement which provided what seemed like legitimate recompense to ‘GKP and its shareholders’ could lead to other apparent injustices elsewhere, I do not see this as a valid argument. The Justice system is there to ensure that we live in a society that is fair and respects the needs of all its people, not one which shies away from seeking solutions to ‘difficult’ questions on the basis that someone else might suffer a perceived injustice. The Justice system SHOULD therefore be capable of changing and adapting its Laws to reflect the society that we now live in…. and always looking to improve or correct outmoded laws. And if TPLF has many flaws - in the way in which it is regulated, the potential for it to be abused, the damage that it can inflict on innocent victims, and the limits on its liability which may encourage (rather than discourage) cases lacking in legal merit… then the Judge is surely duty-bound to consider how best those issues can be tackled. I am certainly not saying it is an easy matter. But it MUST be a responsibility of Legal professionals to look at ways that can help to safeguard the public interest… rather than necessarily to perpetuate a system which might be seen by many as simply adding to the legal work-load and generating lucrative pay-cheques for those with vested interests in maintaining the status quo. You also mention that a ‘lot more people with genuine grievances’ might be put off from starting litigation. I am afraid that I do not agree with this point either. It should simply be a requirement that TPLF carries out greater due diligence, and ensures that only those most meritorious of cases get to court, thereby significantly reducing the likelihood of them getting it wrong and making an unforeseen loss. The legal system can never be a free for all option for any tom, dick or harry to air their personal grievances at great cost to Society as a whole. In any event, the impression given by many of our court reporters is that the backers were palpably unaware of the damning UBS email trail, and had failed to carry out adequate due diligence as to whether Excalibur’s case was a strong or a weak one. In my opinion, they therefore have no legs to stand on if the verdict goes against them in a very big way. I posted an article on here a while ago which outlined that Blackrobe had selected only 2 cases to back out of more than 40 offered to them… which would suggest that they already ‘cherry-pick’ to some degree. I would be interested to know what factors they considered when rejecting the other 95%, and would strongly suspect that, whether someone has a genuine and easily verifiable grievance or not, was not particularly high up their list of priorities. In fact, I would go further than that. It seems obvious to me that the attractions of this particular case lay in the potential for GKP to be effectively ‘blackmailed’ into conceding a settlement that would deliver huge profit without actually doing anything to ensure that the outcome was fair. As some have said TPLF is really a new asset class for hedge-funds, and not (as it is currently presented) a commercial substitute for legal aid. Incidentally, I recall that you were originally in favour of a settlement of say 5% of GKP’s shares to avoid the risks of the case going to court. From a practical perspective, this might have been reasonable, but from the angle of ‘Justice’ it would have left a lot to be desired IMO. I wonder whether your opinion has changed as the case has progressed – my own stance has remained firm. Finally, please note that despite an evidentially strong difference of opinion on this matter, I do VERY much value your legal point of view. My fundamental question though has not I think yet been answered. I will try to rephrase it a bit better… “Is it within the AUTHORITY of Judge Clarke to deliver a Judgement that goes much further than the simple award of ‘Costs’ against the litigants… IF he deems their action, AND that of their backers, to have been ‘vexatious’ and clearly designed to be used for unscrupulous motives?" IMHO, there is nothing ‘emotive’ about seeking to clarify this issue, which to my mind is one that many people on here would be very interested to know. Indeed, maybe it might lead to those who have shown absolutely no emotion to date.... rather quaking in their boots! --- Good evening Elikkos, and all others who have been kind enough to share with us their legal knowledge. This bulletin board has become very much a community, and most I think share the same aspirations which I am sure have been dented by the SP (share price!) performance over the last 2 months, while this Court case has been sapping the energy of so many of us. So, I think it is perhaps inevitable that some of the language used has been inappropriate, views expressed a little over-zealous, and unwitting hapless 'targets' of our anger.. lambasted unfairly. It is perhaps something akin to being in a war-zone where anyone connected with Excalibur is deemed 'the enemy', although, as in the case of Simon Picken, they may just be trying to do a job. Personally, I wouldn't therefore single out pj66 in this as you have, as I think that his was perhaps little more than an unwise choice of language at a time when people generally were looking for quotes which illustrated what a fiasco this case seems to be turning out to be.... and ready to pick up on anything that poor Mr Picken might have said. I suspect there are a few others that warrant much more negative attention... as their interests are most definitely not aligned to most of those here. I think this point needs to be made before we end up picking up on every ill-judged comment and effectively fighting amongst ourselves. That is however just a personal view. However, my question relates much more to what I have previously referred to as the real 'parasites' in this case, those who stand to profit from keeping it going for much longer than we laymen perhaps imagine it should.... and therefore cost many people here a great deal in terms of stress, aggravation, financial pressures, and more. I have read many articles now on third party litigation funding, and the central point argued by those who defend its use is that it offers access to justice for the Davids of this world who would otherwise be unable to take on the Goliaths. Their secondary argument is also that they assume the 'risk' of losing their 'investment' and having to cover the costs of both sides' litigation so if they win, or a settlement occurs they naturally get to keep the lion's share of the profit. Makes sense, doesn't it? Well, not quite! Personally, I (and it seems many others) still regard the idea that the Legal system should present a legitimised opportunity for those uninterested in the respective merits of a case to PROFIT from it as thoroughly reprehensible. But, it is very apparent that TPL funders will fight tooth and nail for their rights to engage in this form of action. And as a non-lawyer, I have no doubt that the apparent strength of their 'legal' arguments will vastly outweigh my own. However, there still seems to be an issue which neither side EVER addresses. And that is the TRUE COST that arises from the litigation... NOT just the Legal & Court costs which one party or other will presumably be required to pay when the case comes to an end. In this instance, GKP has had its key decision-maker (Todd) tied up in court for months and having to expend much of his energy in preparing to provide evidence. John Gerstenlauer, the number two, will also shortly be expected to testify, and has already spent much of his time in court observing proceedings. This has to be commercially damaging at such a key point in GKP's evolution. On top of this, we have seen potential damage to GKP by virtue of its CEO being unable to take his place at the Erbil conference, and some suggestion that important (or at least useful) news cannot be released to investors while the case continues. Furthermore, thousands of investors have seen the value of their shares drop approaching Christmas and many will have chosen to cut their losses or reduce their risk exposure, while the case proceeds at what appears a snail-like pace. While Excalibur lawyers may be talking about quantum in relation to GKP's value at key points in their history, the idea of quantifying the 'damage' caused to GKP and its shareholders seems to get scant attention. And this is just a flavour of the untold damage that this litigation has brought upon what I believe will turn out to be wholly 'innocent' victims. Yet it looks like, irrespective of the verdict, the TPLF funders MAY have prospered behind the scenes over the course of the last two years, the Wempens MAY have received a pay-off for their efforts, and the Lawyers on both sides WILL have earned a pretty penny from this lengthy and extremely high-profile case. In other walks of life, the innocent parties are usually entitled to some form COMPENSATION for the 'stress, inconvenience and financial loss' they have sustained if occasioned by a 'third party'. In this case though, it would appear that TPLF funders and those involved in bringing a possibly 'vexatious' claim are only required to pay 'costs'. It does not seem that this would be true 'Justice' to me. So, in short then, my question is whether the Judge is empowered to include in his verdict the requirement for those who sought to prosper from the claim an additional sum to COMPENSATE the victims - the company and its shareholders? And if this is not currently possible, is there still the potential for Judge Clarke to introduce a landmark ruling which would force vexatious litigants and their backers to think twice before bringing any such similar claim? My feeling, FWIW, is that it would be a sad indictment of the Justice system in the UK if those that lost out unfairly simply had to deal with the consequences, while the perpetrators of an unjust action COULD walk away largely unaffected and perhaps even in Profit... essentially entitled (and encouraged) to do much the same again. In essence, I am wondering whether crime can still pay in the Commercial Court, or whether it is possible that Judge Clarke will plug what, to me, is a seemingly gaping hole. AIMHO and please DYOR GLA, scaramouche ========= Subject Re: Can 'commercial' crime pay?>Sicilian_K View parent message Scaramouche, thanks for your response. Your question is a well written one and I'll repeat it before giving my initial views: “Is it within the AUTHORITY of Judge Clarke to deliver a Judgement that goes much further than the simple award of ‘Costs’ against the litigants… IF he deems their action, AND that of their backers, to have been ‘vexatious’ and clearly designed to be used for unscrupulous motives?" My thoughts are as follows: 1) There is a very useful guide to vexatious litigation at: http://www.tsol.gov.uk/Publications/Scheme_Publications/vexatious_litigants_policy.pdf I recommend that you read it. 2) There is a list of vexatious litigants available for viewing at: http://www.justice.gov.uk/courts/vexatious-litigants 3) In this case, GKP have brought no counter claims for damages against Excalibur or its backers and have not sought to have the Excalibur claim struck out. In any event, Excalibur have no money to pay compensation, so any action to be effective even if this could be done, would need to be against the backers. The grounds that GKP could have used for strike out (if they had the evidence) are found at CPR 3.4(2) "The court may strike out(GL) a statement of case if it appears to the court – (a) that the statement of case discloses no reasonable grounds for bringing or defending the claim; (b) that the statement of case is an abuse of the court’s process or is otherwise likely to obstruct the just disposal of the proceedings; or (c) that there has been a failure to comply with a rule, practice direction or court order." So if these proceedings were an abuse of process, GKP could have made a strike out application, but as we all know, they have not sought to do this. Perhaps GKP too have insufficient evidence to do this, just like you can only state that Excalibur and their funders have had an 'opportunity' to do something ulterior? 4) One common remedy where litigation was brought vexatiously, is where a judge declares at the end of the case that the claim was "totally without merit". Other similar phrases can also be used - but note these declarations are quite rare. Such a declaration has three main purposes: (a) It can assist in the costs assessment later on. Where a claim is totally without merit, or where proceedings were used for ulterior purposes, then one can ask that costs will be awarded on an indemnity basis, meaning that the benefit of the doubt will be resolved in the favour of the party being awarded costs. Usually the benefit of the doubt for costs is resolved in the favour of the party paying costs. See e.g.: http://www.lawgazette.co.uk/in-practice/indemnity-costs-can-add-woe-a-losing-party-s-bill (b) It will give GKP a set of unmeritorious proceedings for any vexatious litigant related proceedings (e.g. a restraining order), but this is usually intended for litigants bringing repeated (2 or more) unmeritorious claims. Even if one took into account the jurisdictional arguments and the application for a freezing order (and I do not know enough about this area of law), the Court would also bear in mind that once this litigation is over, including appeals, it is unlikely that Excalibur will be back. (c) it may assist in shortening the appeal process. Permission will ordinarily first be sought from the trial judge, who usually refuses permission (he might grant it if e.g. there was a novel legal argument he accepted the Court of Appeal should consider, but usually the trial judge stands by his or her own decisions). The appellant can then seek permission from the Court of Appeal. If permission is refused on the papers, the appellant has the right to request that this decision be reconsidered at a hearing, unless the Court of Appeal finds that the application is totally without merit. If the trial judge made such a declaration, it might assist the Court of Appeal in repeating it to shorten the appeal process. 5. The real problem is not third party funding per se. You may have a family member help fund a claim you might have. Your impecuniosity should not be an impediment to justice. Indeed, 'no win no fee' was brought in to ensure that people unable to fund litigation could still afford justice when the government scrapped legal aid for personal injury cases. [I do not wish to discuss the merits of that decision] Nor is your main concern third party funders getting a cut of the winnings should they succeed. If Excalibur succeeded it would not matter to GKP shareholders whether their money went to Excalibur or a funder. What your concern appears to be is the 'opportunity' that third party funders and claimants have to use proceedings for an ulterior purpose. That there may have been wrongdoing even if you have no evidence to show that there was, I add that this would not be unique to TPLF. A claimant funding litigation themselves might have those very same opportunities. (a) This is where better regulation is needed as to how cases are funded and how those funding litigation should be required to conduct themselves before and during that litigation; and (b) Weak cases should clearly be struct out of court earlier than they are now. Why is it that in civil law, that you cannot make a submission of no case to answer after the claimant has presented his case to the effect that the claimant has not proven their case, without being at risk of being unable to call evidence on your own behalf should you lose your submission? Surely there is a public interest in striking out cases that are not made out before the defendant needs to give evidence (be it because of a lack of evidence or a lack of credibility of the witnesses). The claimant brings the case. He has not proven it with his evidence. The case should be dismissed at that point and the court should encourage and not deter such applications. This would shorten proceedings significantly (in our case by a number months). scaramouche, I understand your emotion and I have experienced some of your thoughts throughout the trial, but... ...cast to one side emotion. Your main allegations are worded conditionally, e.g. (emphasis added): - "the TPLF funders MAY have prospered behind the scenes" - "the Wempens MAY have received a pay-off for their efforts" - "those involved in bringing a possibly 'vexatious' claim " In other words, you present no evidence to show that the TPLF funders or the Wempens have actually prospered out of these proceedings through any form of wrongdoing. Without actual evidence of wrongdoing, all you are left with is a litigant bringing failed proceedings. If claimants were at risk, when bringing proceedings, of paying not just costs to a defendant should they not be able to prove their case, but also: (i) damages to a defendant for the defendant's 'stress, inconvenience and financial loss' because of the court proceedings; AND (ii) damages to all other affected third parties who might also be suffering 'stress, inconvenience and financial loss' because of the court proceedings ...then there would be a lot fewer people with genuine grievances who would be put off from starting litigation. This would case injustice and would disproporitionately deter those with low or middle incomes from seeking and obtaining justice. In addition, bear in mind that shareholders are protected from being sued by Excalibur because of the corporate veil. You cannot have that protection from Excalibur, whilst at the same time claiming that they should ordinarily be liable to you, each and individually for your losses caused by the litigation. That said, I understand emotively how it can seem unfair that someone can bring a claim that adversely affects you and if turned out not to be proven, you have no right to a remedy. But the alteratives may merely create injustice elsewhere and possibly more injustice. I accept that where to the criminal standard a claimant can be shown to have fabricated evidence or to have abused the process of the court etc. that further sanction could follow, but a failed legal claim, does not, in itself, automatically meet that high standard. I also accept that this case does highlight the fact that there are concerns about the 'opportunity' for TPLFs to bring court proceedings for ulterior motives and that there should be greater regulation of TPLFs as to when they can operate and what they should and should not be able to do. ================ TPLF not only stirs the emotions of this BB, since like it or not, there seems no doubt that there is a current tension in legal circles between the useful public service TPLF provides, and the risk of champertous actions (against public policy). Some might be interested in the following Guardian article linking TPLF to champerty (incorrectly stating the concept is dead) http://www.guardian.co.uk/law/2012/may/25/litigation-funders-booming-market-uk Some excerpts: Dunn's most expensive loss, when at a previous firm, was £2.5m. "Our biggest win was one we did not reveal was funded." Fees are not standardised; a smaller percentage is charged for larger claims. [TT2 would I be right in assuming the implication being that if it WERE revealed they were less likely to win? Otherwise why mention the distinction?] .................... The word champerty derives from the old French term champart, meaning sharing part of a tenant's field or crop. It was banned because it supposedly encouraged excessive litigation and was only formally decriminalised in 1967. Suspicion lingers. In March, Lord Thomas of Gresford, a Liberal Democrat, called for a statutory code to govern how third-party litigation funding operated, deploring the "insidious advance" into the UK of "essentially an American concept". Ministers, however, support a voluntary code of conduct that was drawn up last November by the Association of Litigation Funders. [TT2 formally decriminalised yes, but champertous actions found to be contrary to public policy will still be "frowned upon" or worse - could that be why the biggest win (above) was one not revealed as being funded? Could that be why SOME are reluctant to reveal TPLF funding?] ...............

Christopher Hancock QC, a commercial barrister who speaks on behalf of the Bar Council on this issue, offers a cautious welcome to the practice. "It represents a commercialisation of the legal process," he said. "But damages-based agreements, as an alternative means of access to justice, will enable people to go to court who would not otherwise be able to. It will probably grow and fill a niche. But it's not going to be an instant cure for the problems of litigation funding [for those pursuing small claims]." He added: "We have some ethical concerns because there's a potential conflict of interest with solicitors or barristers having a financial interest in trials. That needs to be policed. Third-party funding is here to stay. It's right that the code for litigation funders should be voluntary rather than statutory."

[TT2 well, he would wouldn't he?] All IMOHO of course. TT2 ================= Marketchaser, do you read what you post? £2 * 900million shares = £1.8Billion Marketcap and so 30% is £600,000,000. To make £600M in trade profits, saying you were making 25p per trade would mean you would have to have traded at least 2.4Billion shares over last 2 years or approx 6million shares per day (assuming you got 25p in a day) or realistically looking at the chart, you had 20 or so tradable swings which means you would have had to positions of 120million shares per swing. Did you recall any Holding RNS's of 15%? Or getting 20 of them? Did you notice any such huge volume spikes? WAKE UP! The backers and Excalibur are trying to SHAKEDOWN GKP for a settlement. GKP is calling their bluff and whilst justice carries out due process traders are taking advantage of highly nervous PI's like you to force it down to Hoover up stops. The backers may be doing the same (very quietly through shell corporations) but its a few tens of millions not almost a Billion dollars like you think. Derisk, buy more or write to your MP about TPLF but get a handle on your emotions and join the real world. I want to talk about the court case, the politics or the assets but all this emotional venting is of no use and frankly starting to turn me off this board. Starting to understand the likes of TPO... Take a chill pill! It can't be good for you to get this worked up. KKO PS: FYI the Elenas of this world are targeting people just like you. ============ scara - firstly thanks for your kind words . regards SP - for someone who follows many many charts on a daily basis and has done very well on the back of them, was the reference to the sp predictably taking the hit or SP , the QC who yes has got where he is today clearly on good at his job otherwise he wouldnt be where he is today ( but not as good as JG )) for those able to attend the CC JG holds his own , SP on the days i've been there led and prompted by AP and the postic note brigade sat behind him Those who doubted todds cocky ability to stand up in court have been proved wrong , with one day left SP's chance for a damming last throw of the dice has run out , proving a few here had more probing questions they could have thrust upon todd given the chance . Todds was more ruffled at the AGM than in the court under oath so that must tell you something , more prepped for questioning some may say - or the QC not quite hitting the spot , well im glad he couldnt find that spot . ( dont even go there sash ! lol ) EG - you dont know me or my character and F is my second language as we're from very different backgrounds so unfair to judge but if i offended you then i apologise , where all in this together , but i say things how they are , with off the cuff comments as i did to todd about his tie's, JG at the AGM ( are we filled to spill yet john ) ... you get me Elikkos i ask questions a different way to you . for the record i've sat back for years here and not engaged in conflict apart from on one occassion of late . Me i dont pretend to be someone im not ( those who have met me will vouch for that ) or pretend to be qualified in a career im not in . i am willing to share my findings re charts so back to SP the started this and im not talking about the one with a fake tan http://uk.advfn.com/p.php?pid=chartscreenshotshow&u=lFjNklklJkXI/b/gEdWr+2yDrewIJWul&symbol=L%5EGKP pj - my views and no agenda =================== The RNS is fairly is pretty much self-explanatory (IMO): - "Provisional results indicate the oil gravity is similar to that found in the same formations in the Shaikan Block namely 15-18 API." Just join up the dots .... - "In line with the Sheikh Adi PSC, following the notification of discovery, the Operator will submit a Discovery Report ...". Oh dear, not another DISCOVERY. - "Gulf Keystone is the Operator of the Sheikh Adi Block with an 80 per cent working interest, while the Kurdistan Regional Government has a 20% ...". Oh dear again, only 80% - "Todd F. Kozel, Gulf Keystone's Executive Chairman and Chief Executive Officer commented ...."We are very pleased with the outcome of the second exploration well on the Sheikh Adi Block, which is in on trend with Shaikan, our major commercial discovery declared earlier this year. This most recent exploration success points to the significant potential for further growth and future synergies across our world-class acreage in the Kurdistan Region of Iraq.". Will you guys please just LISTEN to Todd?: . ON TREND WITH SHAIKAN. (also review the SH-4 results on this side of that fault ..) . SYNERGIES ACROSS OUR WORLD-CLASS ACREAGE. (check the meaning of 'synergy') If Todd's shouting, then maybe it's ok for me to pipe up again too. GLA, BBBS P.S. I entirely agree with your stance on the court reporting AUDIRS6 - good man. ============================ Author he-who-dares Date posted Monday 20:56 Subject Re: 37 minutes to go View parent message Votes for this Posting Voted 39 times. Message The whole sell on the spike chat is an interesting one.... I had friends who I consider to be smart cookies suggesting to me that I reduce my holding as it soared through £4, but the fact of the matter was it had performed mini retraces in the 2's as well as in the low 3's before kicking on and I thought nothing more than that was occurring again as it dropped from its highs back to the low 4's. The interesting thing about that was those guys saying I should be savvy (i had tripled a substantial holding) and reduce my exposure and lock in some profit were also buying in believing they were on a short term gold mine..... Hindsight is a wonderful thing, and although I know a few on here have me down as a subtle deramper I can tell you I thought on that rise we were sold...I had no interest in selling out in the 4's when we're on our way to £8.... I repeat hindsight is a wonderful thing. I don't regret it cos I thought differently at the time. As zoso eluded to the other day, zoso, doc h and I met pre court case for a night of drinking in late September and all three of us predicted a retrace from 250p back below 200p during the court case....and we all felt holding and adding was the best bet. I knew I could have jumped out 50% of my holding and still banked £30k and got back in with the same shares......mug? Yes. Did I want to risk being out. No....as I explained to friends when we sailed through £4 I have no idea as to where this can go...I just know it will go for something that will be very positive for me. Would jumping out to lock in a healthy profit be smart? Yes. Would it run the risk of missing the chance of a lifetime that I am adamant will come one day...yes it would and therefore I stick. It's tough guys, we've all seen how this share can go...maybe we've been duped, but know it has the potential to take off as like you guys I've seen it happen. GKP will not (IMO) be the company that takes Shaikan the whole way. The KRG cannot afford to accept a company thats fdp is reliant on prompt payment for exports,IMO it's not conducive to the political landscape...it needs a company that has a cash surplus that doesn't require prompt payment for oil sales from the field it is developing. As much as I question whether the day will ever come when we see GKP get taken out and the events of early 2012 repeated and then eclipsed......I just cannot see how it won't ever come...it simply has to. Will it be 2-3 years. Yes it might be. I hope not as this share is a tough hold for the time I've been in 3.5 years, always hoping, always thinking we're almost there. But i don't doubt it will come, as much as that day seems like a dream, the facts suggest it isn't. I will hold and foolishly add (I don't need anymore) but I won't sell until take over as I would be guessing if I did anything else. If you trade, short and make money cos you know what is going on, fair play. I can't tell you without guessing whether this will next see 250 or 130....all I believe is it will be sold. I won't grumble at the price, I took my decision and I will wait for the company to do what it does, if I don't agree I won't vote for the take over, but if it goes I won't grumble. I believe Todd Kozels interests are aligned with mine, and I also believe he values his shareholders interests. Yeah he's a cowboy, but the wild west is where he belongs. Foolish? Well if I thought that I'd sell on the next spike, but I'm not...I'm here til kingdom come...it might be longer than I hope ( every time I save up for a new car it finds it's way in here) I may be a fool but here's my strategy...... Sheet or bust. Bon soirée fellow prisoners of gulf (pogs)....it's the end party for me, whether that is a greasy cafe apprentice style or moonwalking into the Dorchester in a brand new pair of hand made Italian shoes...I'll be there to buy some beers, whether I've rubbed you up the wrong way or you've enjoyed my posts over the years....you'll be a gkp vet like me, and that makes us comrades. Cheers, HWD ===================