Sheffield & Co shortchanging ASX holdersYep. The main risk, as...

Sheffield & Co shortchanging ASX holders

Yep. The main risk, as usual, boils down to capital raising and careful management of cash burn. That is part of this point.

I’m hoping that with Sheffield owning 17%, this will keep him on our side although with larger near term upside at project level + ORRI, it’s not a done deal. His track record at Parsley seems to indicate strong loyalty and transparency with operating teams and an understanding of working in institutional public markets. A few key personnel moved to Formentera with him.

Formentera adds another layer of pros and cons. With Fund II having raised over US$800m last year, he can put up to US$100-150m of fund capital into one deal, if abiding by usual terms of LP investing. However, there will need to be an exit. Assume Fund I is in Daly Waters. These days continuation funds can be structured to enable continued ownership of long term assets while providing liquidity to investors but it’s another known unknown.

Our chairman, Dick Stoneburner, was a partner of Formentera but is no longer listed as such. No doubt, he is closely aligned with Sheffield. Reed and Dalton are the two directors representing Formentera now.

Dave Siegel is probably the director most aligned with us. Plenty of skin in the game at ASX TBN level and a track record of fighting his corner. Everything is negotiable though.