Bullying continues !!!, page-67

The PE result is not known. And it won’t be until it is. However, the PE process is having significant impact. First, FAR has been trying to farm down for a couple of years without success. Why is that? Two reasons. Buyers will only attach value to Phase 1. They might offer bonus payments for future phases but that is all. Offers received have been too low for FAR to accept. because FAR is greedy or believes it’s own hype or both. Secondly, buyers insisted that PE case be scrapped as it’s clearly interefering with the product FAR is trying to sell to the buyer. FAR refused because it’s greedy or stupid or both. And the result...NO SALE. Now let’s talk about raising the money to pay for Sangomar. Lenders have lost a lot of money in the oil game in recent years. So they’ve tightened up their lending rules. They will only lend against low case reserves estimate. That’s not the 250million barrels we read about. It will be more like 170 million barrels. And their lending limit will be worked out on low oil price assumptions too. And when lending to an outfit like FAR, the interest rate will be high. In other words, lenders ain’t gonna take risks. That brings us back to our old friend PE which will delay sanction, risk the license and lose Woody’s carefully negotiated contracts. You can bang on about PE and all the possibilities that might arise but lenders ain’t interested. They simply will not sign off on loans with PE hanging out there. I reckon this is why Cairn probably cannot sanction the project also and why it has to farm down and quick to a company that doesn’t need to borrow. if they can get that in place, Woody can press the button. It’s a mess and it’s all down to FAR. Simple as that.