Peter,
I hope this email finds you well. As previously agreed between ourselves, I have a few questions for you this week from a large number of fellow investors that we would appreciate you answering. I do understand that a few may be a tad pressing but after not contacting you last week with a set of questions to see if your answers to the questions from 2 weeks ago would come to fruition, our group feels that these questions do need answering in light of some of your answers not fitting in with the timescales that you provided.
We would appreciate if you could answer them with more certainty rather then "next week" answers that do not ever happen as stipulated. As you can imagine, PI's are becoming increasingly frustrated with this and feel like they are being walked up the garden path with all of these missed timelines. This is by no means a derogatory statement as we understand that there are outside factors that play a part in things but, surely you should have more of an idea of what is going on as these statements and answers you give that don't come to fruition is not giving your PI's any faith at the moment in the game plan of RRL.?
A lot of business that I conduct is in international trade and when drawing up a contract I use performance bonds to ensure that timescales are adhered to. I'm sure you already know how these work and if investors were to use these (as example) with RRL then you can imagine the cost to RRL in the way of penalties. I guess PI's take your words as their performance bond and the "payment penalty" is the sentiment of the PI's which is increasingly waning which in turn, is detrimental to the SP of RRL. We are just asking for clarity and for the "performance bond" to be exactly what it is meant to be used for.
Anyway, hopefully you can help us with these questions;
1) "No raising at these levels... said back in Summer 2011 when SP was above 15p" - Since then we have raised at at 11p and 12.5p?
Yep - said in summer - world changes , life changes , circumstances change - everything is done because we believe we have a footprint to get range to $1bn minimum on existing cap structure with little exploration success required - when we look at these things we say 5% dilution can return 3-5x minimum in value over and above the dilution - problem is with your time frames and current share performance you can basically say im full of shit and did it solely to screw shareholders over - so when aoc raised a bucket load of money ay 90c for a massive dilution they clearly got it wrong - everything revolves around a big value based event - we have at least 3 available in texas (sale), trin and Colombia - didn’t even mention puntland because we took the view that we needed to protect shareholders if puntland didn’t happen (it has and that is now number 4) - based on your performance bond theory you would have sacked aoc for their 3 year delay in drilling a well and we would all be no where
"Colombia will only happen when SP is higher." - Colombia was raised at 11p?
12.5p and see above re rationale - do you walk away from something that can provide exponential returns on the basis that puntland and georgia are guaranteed successes - called business judgement and more than happy for people to say ive got no idea - would actually prefer that as opposed to time lines and performance bonds - puntland has worked to date, so has texas and Trinidad, jury out on georgia and Colombia just starting - whats not working is the share price and happy to cop that but based on your caustic comments range is a basket case - we are fully funded and can now implement what we need to do to fix the share price - combination of buy back, consolidation, spin out of assets (maybe puntland on shore / offshore solely) into separate aim listed vehicle with free stock distribution to existing range holders - the fact is we recognise the issue and know what we need to do to fix it - wont happen overnight and investors can either chose to be part of it or not - as I said last time (I think) - the time frames you base your expectations on are far different to mine
" Offshore Puntland is an RRL only play" - they now intend to offer RMP a substantial part of it?
Do we - where does it say that , what is the deal - get over yourself on this one - if on shore is a big winner rmp is best placed to offer over the top odds as a farm in partner on a long term play - there is no deal right now - called doing good business and accessing those who would be prepared to pay more to give range the best deal
"21 Wells in TT before end 2011" - less than a third of that transpired?
Yep - and each well has been a disaster - the on ground team underestimated the teething problems is ramping up activity - what a mess I mean most people would normally worry if the oil was there or not - show me where else in the world right now you can get a 1000 ft well to flow naturally at 130 bopd and have a well payback of 2 months - we have 50 of these wells planned and they form part of our p1 reserves - sorry if would prefer 21 wells on time with no oil and shit flow rates
"Socius Raising for Herrera fastrack" - now DELAYED until Q3/4 2012?
Yep - go and see baker Hughes and ask them about the quality of the seismic data shot in early 2000s when it was sent to texas for scrubbing and reinterpretation - outside our control - you say I make excuses - I say I rely on what im told at the time by the consultants (both internal and external) - drilling is q3 and 4 - volumetrics may / june
"Site prep for the spudding of second Georgian well has been hampered by weather", previous announcement erroneously by NOMAD mentions change in tack to CBM gas exploration. This was therefore the plan all along?
Seriously mate - you are welcome to go visit the site pics in georgia - be very clear - if GIG weren’t in we would be doing the second well (called running plan a and b), they are in , they are massive in gerogia and its makes perfect sense to go with them on the revised plan - again good business judgement for me , deliberate ploy to fuck over pi 's for you
When can your shareholders take what you say to be true? The evidence suggests your spoken and written word is not to be relied upon when making investment decisions.
Simple don’t - see my explanations above and if investors don’t feel comfortable don’t be there
2) Is it pure coincidence that the only time, without exception, RRL trades in volumes of over 50M for consecutive days making significant gains, there is a subsequent placing of discounted stock to House broker clients?
Pure coincidence but please stick with your conspiracy theories
3) Puntland Offshore - On the diagram provided with the Quarterly Report you show a series of seismic lines and a well - Gerard Main 1 - Can you share any information about the history of this well and what the seismic's are telling us?
We will put out a full power point preso on the offshore potential when we complete the PSA with the government - wont give a time frame because youll just hang for it and suggest I should be able to control the Puntland Government and Somali politics
4) We would also like to know why range have given an unsecured loan to another PL company, continental coal, of circa $2m whilst issuing shares in the same period diluting ranges share value even further?
Yep range was and is down to its last $2m - whats a better deal for range - money sitting in the bank at 3% or getting effective 15-25% return for short term financing - if you are suggesting in any way that range had to do a placement because we had lent money elsewhere you are wrong
5) The possible "re-entry well" in Colo, why was it closed in/abandoned in the first place please and how long do you estimate the seismics to take please?
Model was run at 15-17-20 usd per bl in the late 70's and logistics / security in the area back then weren’t great - 12 months for seismic and interpretation - re-entry time frame quicker but being finalised
6) This question relates to your compensation arrangements with OKAP Ventures. As you can see on page 60 of the annual report Range paid OKAP (of which You are a director) and another Landau related company $2M in 2011 for general corporate services. This is in addition to the $300,000 you were paid in salary (plus $300,000 in salary, $990,000 you were awarded in stock options and $1.4M to OKAP in 2010) by Range. It seems to us that your interests are not completely aligned with those of Range shareholders. We feel it would only be right of You to disclose how much compensation you are paid by OKAP and what the ownership structure of OKAP is given that you are the founder and managing director. We have questioned some industry experts about this arrangement and they have categorically stated that an opaque relationship like this would give them serious cause for concern when considering an investment in this company.
Good don’t invest - okap is not me alone - it’s the cfo and the 5 accounts managers that are needed to run the projects, the comp cec, the in house legal advisor, the fully serviced offices in perth and London, the pr and ir services, the travel management and the corporate / capital raising services - we do our own comparative analysis and we come in far cheaper than a lot of other companies with our size and operations - its ironic that some people are happy to pay double the number just to see the word consultants, cfo, merchant banks, 15 employees etc etc next to the line item as opposed to the one stop shop - we have a staff of over 20 that can provide the services better and cheaper because with 8 listed companies a lot of the fixed costs can be spread put amongst the group (range is the biggest yes) - many industry experts think the opposite about okap and our model
7) you stated that we would be hearing news on Texas, Georgia and Colombia last week along with Stockmailer being released, all we got was Georgia. What has happened to the details on Texas and Colombia and what has caused the further delay of the Stockmailer?
Texas and colom coming you can see the relevant extract from stockmailer and you are welcome to confirm anything with him given you think all we do is bullshit and screw pi's over
(4 may) Melissa - Hoping to get the Proofs back from Graphic people today - we will proof to get print ready. I will email you the proof as soon as I get them.
Thank you in advance for your time in reading this email and hopefully you can restore a little faith with your PI's with some answers that will actually happen when you stipulate they will.
Please don’t be shareholder if my number one objective and performance target is to meet time frames I provide as a best estimate at the time (what would you have done with aoc with their 3 year delay, dilution and intro of the Kenyan and Ethiopian assets) – our assets are great, fully funded, so much activity (clearly not on time) – fully aware of our faults and always open to constructive criticism and suggestions (especially on the share price) – unfortunately I don’t find your emails constructive in any way – they are aggressive and designed purely to suggest that it’s all a big con job – as I said will always respond because I actually know what we can and will achieve and cannot stand the fact that your approach to everything is half glass empty – the other irony is range (not aoc, horn and rmp) has done such a good job legitimising puntland, that as a value proposition which we sought to mitigate and insure against is currently flying (was that good or bad business judgement – don’t know but be very clear that whatever the share price our 20% interest is the same as rmp;s and horns (pro rata) |
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