What happens if the NO votes win?

[kommonsents]

We have not touched much on what happens if the NO votes win.  Some considerations and concerns are as follows.

Is IOC still a viable company?  How much liquidity do we have to work with since the PSO has caused so much destruction.

Until and unless changed, the PSO is still CEO and the BoB (Board of Betrayers) is still the BoD.  How and when is that changed?

How low will the pps drop if the NO votes win?  Or will it drop?

Setting aside how much the other assets outside PRL 15 might be worth, how much is our agreement with TOT really worth?  We hear on SHU about how we should vote NO and reap higher rewards.  But in 2 1/2 years since the Transformational Event, the PPS has lost about 40% to date.  Can IOC really make it to FID and beyond with the degraded balance sheet?  I'd hate to see us create a situation where we create liquidity only to blow it for keeping the doors open.  In other words, how long can IOC really last under present circumstances since the PSO has obviously spent us almost to ruin.

Can IOC actually monetize known gas at TBR and perhaps elsewhere?  To Exxon for train 3?  For how much?  When?

Can we hold onto our present leases?

These are just a few thoughts.  What else should we consider if the NO votes win?

[Kaliboo]

I think this is a good question to rethink.  It was a no brainer when we had the OSH offer; vote NO.  Now we have the slightly improved XOM offer and no word yet from TOT, though some believe they are not going to bid based on some unamed sources.  We do know OSH will not rebid.

So if I were XOM and had the only LNG plant in the country and with prices likely to remain low for years, I probably would not rebid if shareholders voted NO.  I'd simply wait.  XOM knows IOC is destroyed thanks to our current mismanagers.  XOM can afford to sit and wait.  IOC cannot.  At some point we are a distressed seller with crooked people running and robbing the company.  Waiting has worked well for XOM so far. With all the gas being stranded in PNG, XOM is the only ticket out.

IF we vote NO, what forces XOM to sweeten the deal?  I suspect OSH is happy for XOM to buy IOC.  TOT may see it as a way to assure they get lowest cost on developing the gas, and thus more profitable compared to builing a whole new plant.  I'm sure income begins sooner with a larger single XOM operated LNG plant.

One thing amazes me.  Oil companies know that in newly discovered basins where elephant fields are found, there will be more, possibly biggger or similar in size.  But eventually each new discovery typially finds smaller fields.  But they are on the very front end of exploration.  With IOCs acreage and seismic and air gravity data, it would seem they would place high value on getting this.  Instead the deals give zero value for it.  And we have other discoveries on top of it.  I don't get it.  I suspect two reasons (1) low gas prices and gas glut with stranded gas and one path out, (2) it's PNG corruption and associated uncertainty.

All of us should be favoring only 1 LNG plant in PNG and keep it operated by XOM.  That way the government can't play companies against each other.  XOM will have lots of leverage to ensure the gov't behaves.  Shutting the plant in a few days won't hurt XOM, but will really ding PNG income and budgets.  We should want it to remain that way and own a piece of that.

As long as no one else can afford to build an LNG plant, what good is a gas lease?  As long as we are in this low gas price world, I think XOM has all the cards.  A No vote on the XOM deal will need to entice another company to bid to rescue us from this dilemma.  IF and when that happens, then XOM is likely to step in with a slightly better deal.  But I don't see that white knight riding in.  XOM will just wait after a successful No vote for an even better time to act.  If I'm correct on this, then IOC shareholders will be very disappointed.  Management cannot add value.  They can only subtract as we go forward.  Hard to picture what will follow.  So voting yes or no on the XOM offer is a much more serious consideration.  IMHO.

[Putncalls]

That PNG resource at Asia's door step becomes more valuable as the LNG market continues to stabilize AND grow. If MH and crew hid in a cave for a year IOC might double in value.

[Thylacine-2]

I think this is a good question to rethink.  It was a no brainer when we had the OSH offer; vote NO.  Now we have the slightly improved XOM offer and no word yet from TOT, though some believe they are not going to bid based on some unamed sources.  We do know OSH will not rebid.

So if I were XOM and had the only LNG plant in the country and with prices likely to remain low for years, I probably would not rebid if shareholders voted NO.  I'd simply wait.  XOM knows IOC is destroyed thanks to our current mismanagers.  XOM can afford to sit and wait.  IOC cannot.  At some point we are a distressed seller with crooked people running and robbing the company.  Waiting has worked well for XOM so far. With all the gas being stranded in PNG, XOM is the only ticket out.

IF we vote NO, what forces XOM to sweeten the deal?  I suspect OSH is happy for XOM to buy IOC.  TOT may see it as a way to assure they get lowest cost on developing the gas, and thus more profitable compared to builing a whole new plant.  I'm sure income begins sooner with a larger single XOM operated LNG plant.

One thing amazes me.  Oil companies know that in newly discovered basins where elephant fields are found, there will be more, possibly biggger or similar in size.  But eventually each new discovery typially finds smaller fields.  But they are on the very front end of exploration.  With IOCs acreage and seismic and air gravity data, it would seem they would place high value on getting this.  Instead the deals give zero value for it.  And we have other discoveries on top of it.  I don't get it.  I suspect two reasons (1) low gas prices and gas glut with stranded gas and one path out, (2) it's PNG corruption and associated uncertainty.

All of us should be favoring only 1 LNG plant in PNG and keep it operated by XOM.  That way the government can't play companies against each other.  XOM will have lots of leverage to ensure the gov't behaves.  Shutting the plant in a few days won't hurt XOM, but will really ding PNG income and budgets.  We should want it to remain that way and own a piece of that.

As long as no one else can afford to build an LNG plant, what good is a gas lease?  As long as we are in this low gas price world, I think XOM has all the cards.  A No vote on the XOM deal will need to entice another company to bid to rescue us from this dilemma.  IF and when that happens, then XOM is likely to step in with a slightly better deal.  But I don't see that white knight riding in.  XOM will just wait after a successful No vote for an even better time to act.  If I'm correct on this, then IOC shareholders will be very disappointed.  Management cannot add value.  They can only subtract as we go forward.  Hard to picture what will follow.  So voting yes or no on the XOM offer is a much more serious consideration.  IMHO.

  Sounds about right to me.   Thanks, Kaliboo.

[ArtM72]

We really 'litigated' this on the lead up to the July 28th vote. (Has it officially been cancelled?) Since the XOM offer is nearly identical to OSH's with the difference being largely limited to a NYSE v ASX exchange almost all the arguments can get recycled.

We don't know how much money IOC has anymore but other than bonuses coming due IOC doesn't seem to have much to do other than properly archive their data. A good shareholder suit to challenge Hession and the BOD's bonus payments on the basis of impropriety should freeze those funds for at least a couple of years. I read the PSA agreement to say IOC gets around $220 million for a minimum of 6.5 TCF of gas. I'm not sure how much of the $220 million will be netted to IOC coffers, but we don't often talk about the 3.5 to 6.5 TCF traunches.

I expect to find the next set of financials to tell us a lot about how long IOC can last just on the income from Total.

Two additional points. Hession gets half of his Change of Control bonus just on the Board recommendation of a deal. We would have to sue to stop that I trust. The second half doesn't become payable unless there is an actual transfer. Also, Botten doesn't get his $60 million if we vote NO.

Finally, while IOC can't sell off PRL15 without automatically giving OSH and TOT rights to match any offer, IOC can farm down a lot of other acreage without interference from OSH, TOT or XOM.

[Libtardius Maximus]

Art,

At this pace IOC will go broke due to the cost of printing proxy material.

[CAC]

[quote='Kaliboo' pid='74782' dateline='1469474657']

I think this is a good question to rethink.  It was a no brainer when we had the OSH offer; vote NO.  Now we have the slightly improved XOM offer and no word yet from TOT, though some believe they are not going to bid based on some unamed sources.  We do know OSH will not rebid.

So if I were XOM and had the only LNG plant in the country and with prices likely to remain low for years, I probably would not rebid if shareholders voted NO.  I'd simply wait.  XOM knows IOC is destroyed thanks to our current mismanagers.  XOM can afford to sit and wait.  IOC cannot.  At some point we are a distressed seller with crooked people running and robbing the company.  Waiting has worked well for XOM so far. With all the gas being stranded in PNG, XOM is the only ticket out.

IF we vote NO, what forces XOM to sweeten the deal?  I suspect OSH is happy for XOM to buy IOC.  TOT may see it as a way to assure they get lowest cost on developing the gas, and thus more profitable compared to builing a whole new plant.  I'm sure income begins sooner with a larger single XOM operated LNG plant.

One thing amazes me.  Oil companies know that in newly discovered basins where elephant fields are found, there will be more, possibly biggger or similar in size.  But eventually each new discovery typially finds smaller fields.  But they are on the very front end of exploration.  With IOCs acreage and seismic and air gravity data, it would seem they would place high value on getting this.  Instead the deals give zero value for it.  And we have other discoveries on top of it.  I don't get it.  I suspect two reasons (1) low gas prices and gas glut with stranded gas and one path out, (2) it's PNG corruption and associated uncertainty.

All of us should be favoring only 1 LNG plant in PNG and keep it operated by XOM.  That way the government can't play companies against each other.  XOM will have lots of leverage to ensure the gov't behaves.  Shutting the plant in a few days won't hurt XOM, but will really ding PNG income and budgets.  We should want it to remain that way and own a piece of that.

As long as no one else can afford to build an LNG plant, what good is a gas lease?  As long as we are in this low gas price world, I think XOM has all the cards.  A No vote on the XOM deal will need to entice another company to bid to rescue us from this dilemma.  IF and when that happens, then XOM is likely to step in with a slightly better deal.  But I don't see that white knight riding in.  XOM will just wait after a successful No vote for an even better time to act.  If I'm correct on this, then IOC shareholders will be very disappointed.  Management cannot add value.  They can only subtract as we go forward.  Hard to picture what will follow.  So voting yes or no on the XOM offer is a much more serious consideration.  IMHO.

*******

IOC, TOT, and the PNG govt have all publicly spoken of a 2nd plant being built by TOT.  That was, and potentially still is, the way to "unstrand" our gas without XOM.  OSH even indicated (when they wanted to buy IOC) they thought TOT would build a new plant.  Has any of these four entities back-tracked publically...at all...on that plan?  XOM can't "wait us out" if we are moving forward with TOT, right?

[Theman12345]

Beware of shorts inputting negative thoughts before the Total bid. They know how much analyzing this board does on each and every syllable or number of a new statement and love that we are distracting ourselves with repetitive scenarios. Why would anyone bid yes for the Exxon bid, because it is in US Dollars? This deal, bottom line is no better then the Oil Search offer, they want us for pennies on the dollar and as long as we continue to go in circles that's what they will pay for our shares. Hang tough and have faith, things will work out better then they are now.

[ArtM72]

Art, At this pace IOC will go broke due to the cost of printing proxy material.

yeah. That has occurred to me as well.

The he best part about tomorrow might be independent confirmation of management and board trades with undisclosed deals in negotiation. I've been wanting to see Gump's allegation confirmed. Hadn't gotten it done. Phil evidently has.

Lock 'em all up and claw back that cash. Shareholders Unite!

[haroco]

I think this is a good question to rethink.  It was a no brainer when we had the OSH offer; vote NO.  Now we have the slightly improved XOM offer and no word yet from TOT, though some believe they are not going to bid based on some unamed sources.  We do know OSH will not rebid.

So if I were XOM and had the only LNG plant in the country and with prices likely to remain low for years, I probably would not rebid if shareholders voted NO.  I'd simply wait.  XOM knows IOC is destroyed thanks to our current mismanagers.  XOM can afford to sit and wait.  IOC cannot.  At some point we are a distressed seller with crooked people running and robbing the company.  Waiting has worked well for XOM so far. With all the gas being stranded in PNG, XOM is the only ticket out.

IF we vote NO, what forces XOM to sweeten the deal?  I suspect OSH is happy for XOM to buy IOC.  TOT may see it as a way to assure they get lowest cost on developing the gas, and thus more profitable compared to builing a whole new plant.  I'm sure income begins sooner with a larger single XOM operated LNG plant.

One thing amazes me.  Oil companies know that in newly discovered basins where elephant fields are found, there will be more, possibly biggger or similar in size.  But eventually each new discovery typially finds smaller fields.  But they are on the very front end of exploration.  With IOCs acreage and seismic and air gravity data, it would seem they would place high value on getting this.  Instead the deals give zero value for it.  And we have other discoveries on top of it.  I don't get it.  I suspect two reasons (1) low gas prices and gas glut with stranded gas and one path out, (2) it's PNG corruption and associated uncertainty.

All of us should be favoring only 1 LNG plant in PNG and keep it operated by XOM.  That way the government can't play companies against each other.  XOM will have lots of leverage to ensure the gov't behaves.  Shutting the plant in a few days won't hurt XOM, but will really ding PNG income and budgets.  We should want it to remain that way and own a piece of that.

As long as no one else can afford to build an LNG plant, what good is a gas lease?  As long as we are in this low gas price world, I think XOM has all the cards.  A No vote on the XOM deal will need to entice another company to bid to rescue us from this dilemma.  IF and when that happens, then XOM is likely to step in with a slightly better deal.  But I don't see that white knight riding in.  XOM will just wait after a successful No vote for an even better time to act.  If I'm correct on this, then IOC shareholders will be very disappointed.  Management cannot add value.  They can only subtract as we go forward.  Hard to picture what will follow.  So voting yes or no on the XOM offer is a much more serious consideration.  IMHO

Kaliboo, very good thinking   I would like to add to your thoughts in paragraph "One thing amases me:"   (3) our "pertending" to be CEO  who's actions are only in his personal interest. did not  separtate our two main assets :  Elk-Antelope and TBR +++ acreage, i.e., interested parties please submit a separate bid for each!