Ann: Lukoil Non-Binding Indicative Proposal, page-192

Hi KKW,

I'm not sure I agree that Lukoil is serious. Indeed I am wondering if either Remus or Lukoil are particularly serious. Each of their bids is very low (considering the recent POO movements). Lukoil has come in just 0.1c higher than Remus...so certainly not a huge attempt to knock Remus out of the ring. Furthermore both bids are non-binding. In Lukoil's case I do wonder why, when Lukoil already have great knowledge of the project (having previously tried to buy out CNE's share). There was also much speculation that FAR at the time was also spruiking its share to CNE's 'buyer' (Lukoil)....if that were the case Lukoil would have pretty good knowledge of FAR's inner workings as well.

The last I read Remus was just waiting on Board signoff...what has happened to that? Considering the PE deal to Woodside was only saved from going to shareholders last week by Lukoil, it seems Remus may have already walked away.

And what about the coincidence of Lukoil's bid being announced the day before the shareholder's meeting...again why have Lukoil left it so late when it has known the full intricacies of the project for some time?

A conspiracist might wonder if there is something else going on...that these "bids" are perhaps some friendly stalling tactic - perhaps to allow time for another potential outcome...something like new negotiations on debt financing? The one major argument against this though is why would Remus or Lukoil try to help FAR??

Like everyone I am amazed with what is going on...unfortunately though, on the surface there does not seem to be any real commitment by any of the parties...which in itself is amazing when you consider the underlying value of the project.


dodds