mog announcement, page-10

Do you know what I think Ya – the MOG issue won't go away and the MOG management should put more care into preparing their announcements.

Firstly on 29 Sep 2009 MOG announced that they were to acquire 15% of WA-360-P and 50% of WA-409-P both owned by Rankin Trend a subsidiary of Gascorp (subject to shareholder approval). WA-409-P is half owned with CUE. A condition of the agreement is subject to 'MEO providing Rankin Trend on or before 31 December (note the date I will touch on that later), with an irrevocable binding commitment to drill a well in WA-360-P'.

In the same announcement it stated that MobyOil is presently obtaining independent reports on WA-360-P.
Fair enough. If no commitment to drill a well by 31 Dec then MOG will walk away. Comment was made in this forum at the time regarding the delay in ASX placing the ann with MEO 6 Oct.

Secondly on 12 Oct MOG announced an amendment removing the condition for the commitment to drill ‘Moby will acquire Rankin Trend regardless of whether MEO gives Rankin Trend that irrevocable commitment to drill a well'.
So MOG will now take the 15% share off Rankin (Gascorp) whether or not the commitment is made by 31 December (subject to shareholder approval). I am sure Albers came to this decision to try and gain shareholders confidence in the upcoming vote.

Thirdly comes the Memorandum to shareholders prior to the AGM. I have posted in the MEO forum about this memorandum before because it is quite confusing too. The interest to MEO shareholders is the Artemis valuation report by RPS Energy which DMR could not include in its valuation report – this will hold up MOG shareholders decision whether or not to approve the takeover of Rankin until after the MOG AGM on 23 Nov. This should not affect MEO because the farmin negotiations are expected to be concluded by the MEO AGM 18 Nov.

Lastly comes the MOG announcement in this thread (6 Nov). Ya picked up the incorrect date – 1 Jan 2009. My point about this date is that the extended date of the permit on WA-360-P was extended by 12 months until 31st January 2010 as noted on MEO’s website:

http://www.meoaustralia.com.au/icms_docs/43598_Carnarvon_Basin_Exploration_Permits_WA-359-P_WA-360-P_and_WA-361-P.pdf

I don’t know where the 01 January 2009 (should be 2010) comes from at all. Hopefully this will become irrelevant once the negotiations are completed by MEO.

The other point you make, Ya, is what will MOG be left with if MEO does not meet the requirements of a commitment to drill Artemis.

The way I see it is that MOG (essentially Albers) is trying to switch the Rankin Trend Ltd part of Gascorp (which he owns) to MOG. Rankin Trend presently consists of
1 15% Artemis (with CUE 15% and MEO 70%)
2 50% WA-409-P (with CUE 50%)
NB: Rankin Trend is only a part of Gascorp and is 100% controlled by Albers. Albers is trying to takeover (or move) the Rankin Trend part of Gascorp to MOG. This will in turn make Albers the majority shareholder of MobyOil ie a takeover by stealth (see DMR report in MOG memo – ‘may increase Albers interests in Moby to 74.19%’). Present shareholders in MOG will see their holding diluted. This is why the Artemis deal is important to MOG (Albers) because the dilution in shares will be masked by the success of Artemis increasing MOG’s SP. If the Artemis drill does not go ahead then Albers will still have the majority in MOG albeit the SP will be back at 6c IMO. If the shareholders vote no on the Rankin deal then nothing will have changed.

If MEO does not go ahead with Artemis then their 70% will revert to MOG and CUE who will get 35% each. This will give MOG and CUE 50% share each but the task of raising money to drill the well or going through the same process as MEO.

To summarise, the more I look into the MOG/MEO relationship I feel that Albers is cleverly using the work being done by MEO as a back door to takeover of Moby Oil. A bold statement I know but the evidence is there.

How does this affect MEO. I don’t think it does because the more I look at it MOG/Rankin/Cue don’t come into play much at all apart from their free carry. Also there is a positive outcome expected from the negotiations. MOG (especially Albers) have far more to lose should the farmin deal not go ahead - but will they. They have already benefitted from the price spike in MOG.

Perhaps the stalling tactics by Albers is to allow the farmin deal to be finalised first to buoy the mood of MOG shareholders – or, alternatively, ensure a no vote if the farmin negotiations fail (not that they will):)

But this is only my opinion.