Time Between Board Agreement & Disclosure

[steve3752]

At the annual meeting I believe five years ago, I asked CV a general question regarding agreements asking  how long it took for paperwork to be prepared by lawyers.  He said six months.  I then asked if  IOC would disclose an agreement while the lawyers were doing the paperwork. He said no disclosure until everything signed.  This would have been before any of the present  agreements including Mistsui.

Given the legal complexity of what we are now dealing with, if the board were to make a pick in March, any ideas as to whether we will have to wait for the lawyers to draw everything up before hearing anything  or will there be a Memeorandum Of Understanding?

Hemi, I remember it was the two of us talking to CV prior to the meeting.  Any feedback on this?

[efi426hemi]

Hey Steve-o,

I remember that conversation and I have followed up numerous times to see if that statement continues to hold true. I still believe that it does hold true with one caveat - the wishes of the winning bidder.  So for example if JKM wins and for political reasons they wanted to announce to the Korean and Japanese public, IOC would concede to those wishes and announce early.

However, I believe that this legal work has been 98% completed and reviewed for all the submitted bidders and that all remaining documentation will be contained in Schedule A documents which could be vetted very quickly by IOC legal allowing for an almost immediate announcement after the winner has been choosen.  See my post here on more details regarding this train of thought:  http://shareholdersunite.com/mybb/showthread.php?tid=2802

My experiences though, are based on service bids with a provincial government and are clearly on a scale much smaller than the IOC selldown - so my conclusions could be incorrect.  One thing I do know for certain, time will tell all!

Keep it on Ice!

Hemi

[CesiumFormate]

These sell down and partnership agreements, while complicated, are not new to the oilfield lawyers. As with the Pacific Rubiales sell down agreement, it can be announced ahead of time with an LOI and inked later. I do not see any reason why it can not, and would not, happen in this situation. It is not uncommon for LOI's to be written with costly out clauses if final documents are not inked, or if there is third party intervention such as a buyout that interferes with the original intent of the agreement. One thing that we have to keep in mind is that there might be something for almost everyone in this deal that keeps IOC from being buyout prey. They could announce a partner with selldown to the operator partner, and additional selldown pieces with other production partners. It is a big field with a great deal more potential. It would make a great deal of sense to spread the development risk around. I go back to my post many months ago. If XOM is a selldown partner and there is an investment plan in place to connect to their Tee with dry gas, we get FID and cash flow sooner rather than later.

[Palm]

Agree Cessium, and add another point in this. PNG wants this project announced and moving ASAP. I think they'll want a photo op very quickly once the partner is chosen.