meeting with ms, page-110

Hi Alan

We are bringing them a listing, the legal and resource expertise and a combined bag they can put everything in.

Falcon for example have 5% of three blocks and 10% of another.

The operators are playing hardball however - they are doing exploration, but not putting anything into production. As such, Falcon need to suddenly come up with $400M (it was $800M before Conrad and team started negotiating) - if they can't they need to give up their share of the blocks (as per the other blocks that they are listed as owning in old documentation which they no longer have).

They could not do this with a major, as it would be them that were then the junior partners. This way they get their worldwide listings, projects that will actually progress because they have finance organised, legal title sorted out fully, access to world class talent (through the likes of BHP via Eagan) - the cost to them is essentially a 12% fee for doing so (88% dilution of CVI shares).

Does this make sense? CVI are the junior partner doing the "donkey work".

Cheers