CGX Energy Inc V.OYL

Fairly simple next steps…

[westcanpride]

It's pretty simple at this point. If no JV/farmout is available via HL efforts, then FEC has to buyout CGX from Corentyne and the port. 

Let's be real... FEC has ~257 million shares in CGX. They buyout CGX at $1 cad, they only have to pay $82 million cad for the remaining shares and in essence walk away with $175 million cad in "new" cash ($257-82). I say new only because this investment has been horrible for them and this cash would in essence open many new doors again. 

That money would go a tremendous way to paying for new wells in Corentyne (provided FEC wants to keep the license and not be the next causality of government anger). 

Would FEC allow $175 million in "free" cash become evaporated because they were too stubborn to play fair with CGX and rather allow them to become eliminated by the government? I guess weirder stuff has happened but I cannot see it.

[IceDog13]

This makes no sense at all. Where is this $175 million in free cash coming from? Is this there own money after paying $257 million, losing $82 million in the process? That is not new cash, that would be there own cash and less than they started with. And why would they pay $1 per share when it is currently trading at $0.25?? If (and this is a BIG if) FEC wants to buy out CGX, they could offer a

[westcanpride]

You missed my point. Of course I know FEC has their own money on the line with those shares and would be "losing" $82 million.  But what is the alternative? Take CGX out at .40 cents like you propose? How in the world does this help FEC? FEC still needs a hell of a lot of cash going forward to pay for new wells in Corentyne. What's the goal instead? Keep drilling one well per

[IceDog13]

"You missed my point. Of course I know FEC has their own money on the line with those shares and would be "losing" $82 million." $82 Million is a LOT of money for any company. What makes you think FEC would just give this to CGX investors? "But what is the alternative? Take CGX out at .40 cents like you propose?" You are proposing taking them out at $1 a share, which

[westcanpride]

So what makes you think FEC has all this cash to carry out a appraisal program before ever declaring a FID? FEC doesent even have enough free cash flow right now to finance a maximum share buyback right now.  Not too mention, intentionally giving away >$100 million in shares (FEC break even in CGX is ~.85 cad) would certainly make De Alba look even worse and create further instability

[IceDog13]

Umm... you are the one suggesting FEC invest a significant amount of money. I have made no such assertion. You suggested FEC buyout CGX at $1 per share, I countered that at $1 it would be a gross overpay, at $0.40 which is a huge premium to todays close, the same deal could get done. (Probably even lower than that).  In your final statement you take an alternative approach saying FEC

[waitingstill]

I think WCP is not being clear with his statements. I think he is trying to say... FEC should have given CGX fair market value in the past instead of trying to shake them down and taking shares for pennies because NOW, no ones values CGX shares more than 24c. Because FEC are IDIOTs. They should have pumped CGX shares giving fair value in the past and had the SP at $2-3 and then SOLD CGX to the

[SheDrills]

Neither company is able to dilute in order to raise capital here...there aren't enough willing buyers. It's achieve a farmout deal or lose the block here. Frontera shareholders don't want to fund another well and have told management as much.

[waitingstill]

SheDrills, do you think that FEC is going to just walk away from their $500mil investment so far? Seems pretty drastic. I don't think they can even write it off, can they considering it is in Guyana and all their revenue is "not Guyana"? But I am no accountant so I can not be sure. Just seems like big loss to eat when an appraisal hole for Mass only would not break the bank.

[SheDrills]

I'm saying that if they can't farmdown, they should walk away. They are essentially showing prospective buyers (with more experience & expertise) their data. They aren't holding anything back. So if all prospective buyers say "no, this isn't worth it, we have better options". What gives Frontera the confidence that they know better than a dozen firms that

[Frank007]

Shedrill ...you r out to lunch ...I have been readying your posts and most are spot on but now ! ...legally if Guyana tries to pull a fast one ...they will be in court so fast ..and a judgment against their cash held in New York would go to Frontera and cgx ...you and I know this is all a cat and mouse game to shake out weak hand ....these crooks running this scam are very good con men .......no

[ranman1]

This is a stark contrast to what you have been saying all along. Walk away from 500mil..  

[SheDrills]

It's only 500 million if they can prove it...a farm out agreement would show investors it's likely. Current share price is a sign investors do not believe 

[Dell1]

Christina, you are right as always! Something is not making this data room that attractive for a JV to be done. Sadly, this is the riality

[SheDrills]

The longer this is taking the more obvious it is that a development isn't a slam dunk. I'm not sure what the hang up is...maybe it's simply geo due diligence, maybe it's Guyana announcing a gas & unitization framework, only insiders know how close they are to a deal.

[Mbxwatcher]

imo, I dont think Investor sentiment has anything to do with Geology, or what they may or may not have. Its the result of sheer mismanagement of what should have been a world class asset. I think there is no belief that management has any interest whatsoever in a return for shareholders, even though thier interests and ours should be aligned. We are being set up for a sweetheart deal for

[Mbxwatcher]

Put another way.........and maybe a stupid queston but: Given the proximity to Straebock, is there anyone here who doesnt believe there is oil and lots of it in the North Corentyne.   We all know that someday, someone will be pumping tons of the stuff out of there on someone else's dime, and to someone else's benefit. Just curious but honestly speaking, is there anyone here who

[Coloradobuff]

Agree, shareholders will get screwed and someone else will grab it and make a fortune.

[westcanpride]

SheDrills,  if you are correct, why in the hell didnt FEC just sell out then after Kawa? Rumors were a deal was available yet he was turned down. I get Wei came in far less than hoped, but end of days it's clear neither management team had any sort of forward planning and were just hoping to get lucky.  im not buying that no one wants this land. We have only seen prospective

[ranman1]

Since when did Frontera ever listen to its shareholders !

[Kingmosabe]

Exactly..This makes the most sense.