Extract from CXY announcement on 16th July, We have now been advised in writing today by the independent testing laboratory that the result from this one sample was incorrect, Cougar Energys Managing Director, Dr Len Walker, said today. Further, and prior to DERMs announcement and its decision on Kingaroy, we advised DERM that a subsequent test sample taken one week later and submitted by Golder Associates from the same water bore generated a clean (zero) reading, free of contaminants, Dr Walker said. Cougar Energy is confident that a full investigation into the discrepancy in the laboratory results will confirm that the Company has been conforming with Government requirements and that a reading submitted in good faith by Cougar Energy and which resulted in this sudden DERM shut-down decision, is incorrect.
Cougar Energy executives are this afternoon meeting with DERM to advise of the laboratory results discrepancy and will be presenting DERM with a written admission by the independent laboratory regarding the incorrect results. Cougar Energy will also produce results to verify that the last two monthly sampling tests conducted by Golder Associates showed no trigger levels of contaminants."
Yes guys and gals, a suppliers c*ck-up led to this mess. One good thing remains, everyone now knows about petrol station pollution and that UCG is safe.
The bigger issue, is how a reputable testing agency like Golders can make such a mess of a simple testing procedure. I would guess that CXY will have an excellent damages case against Golders, and are extremely likely to succeed and secure return of expenses paid out to recover from this mess. This is likely to include any negative costs associated with future fund raisings.
It reminds us all of how exposed we are to human error sometimes, but projects like CXY's (and others) are not immune from a simple human, process or equipment mistake. It matter not how large the consequences for everyone else either.
CXY's large shareholders are an interesting bunch (almost all very knowledgeable about the UCG process, its economics and importance of previous experience) and most of them will no doubt be buying through this short term fluctuation. Any fall will most likely be balanced by a rise shortly thereafter.
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