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EEGC apparently the CEO had a vision from God they would find oil LMFAO

http://www.abc.net.au/news/stories/2009/04/03/2534708.htm

Sceptics question vision of local oil strike
By Rowan Dix

Posted Fri Apr 3, 2009 7:00pm AEDT
Updated Sat Apr 4, 2009 10:13am AEDT

Slideshow: Photo 1 of 2

(ABC News: Cameron Atkins)

Map: Miena 7030
The man behind a decade-long search for oil in Tasmania has defended claims he is living it up in Europe while not having delivered any black gold to his investors.

Malcolm Bendall, founder of Great South Land Minerals (GSLM), has said he had a vision from God about finding oil in the state.

He told ABC TV's Stateline the vision foretold huge amounts. "I believe personally we have 10 billion barrels of oil in Tasmania," he said. "It's my belief and I've followed through on that belief with my own money and own time for 32 years."

While not sharing Mr Bendall's religious beliefs, his chief geologist Clive Burrett is just as optimistic. The pair met at university in the 1970s, where Mr Burrett was a geology lecturer. "I have confidence. That's why I left the university to pursue this," Mr Burrett said.

Malcolm Bendall's company claims to have spent $40 million on seismic surface testing in Tasmania's Central Highlands. It has published optimistic results and attracted more than 16,000 investors but Mr Burrett says there's a long way to go. "It's a virgin basin and, until you've actually drilled those seismically-defined structures and perhaps drilled 10 or more of them, that's not a valid rest of a basin until you've done all the drilling work."

A viable source of oil has never been found in Tasmania and Mr Burrett says patience is needed. "We are very optimistic that we will be drilling soon. This has been a long process but it's been a very expensive process and it all started in the back of Malcolm Bendall's Land Rover, 30 years ago," he said.

GSLM's 10 year exploration licence expires in September and can't be renewed. However, it can apply for a fully-fledged mining lease if there's enough evidence of commercial oil or gas deposits.


Investor hopes

After years of waiting, local shareholders were given their first look at the rig on location two months ago. Mr Burrett says the Bellevue site is now ready for drilling. "There's been some scepticism that it actually exists," he acknowledged. "Here is proof that it's here, and the company's going ahead."

Some investors were encouraged by what they saw in February. Mike Pace said "Oh it's great, the rig's up" but, six weeks on, there is still no drilling. Mr Burrett blames a Chinese investor for withholding money but says the company is re-financing and should drill very soon. "I share their frustration but at the moment it's very difficult to raise money. There is a global financial crisis going on and the fact that we are optimistic at the moment I think is an indication that people do think this basin, in Tasmania, is worth exploring," Mr Burrett said.

Speaking from London, GSLM Founder and Chief Executive Malcolm Bendall made a promise. "I can absolutely guarantee you we will have oil and gas in the hole. What we don't know at the moment is whether it's going to be in commercial quantities but we believe that it will be."

As well as enthusiastic investors, there are plenty of sceptics. Geologist Chris Sharples went to university with Malcolm Bendall and was also taught by Clive Burrett. "There's a plausible story," Mr Sharples conceded. "But the problem is there doesn't seem to be any actual evidence that there actually is any oil. If there really was large commercial quantities of oil in onshore oil reservoirs in Tasmania, given the amount of geologically recent tertiary faulting that we have in Tasmania, you'd expect there to be little oil seeps everywhere."

Clive Burrett rebuts the argument. "The problem with oil of course, when it comes to the surface, is that it's a pretty yummy product. It's organic material and so where you do have oil coming out, it's immediately eaten by bacteria and fungi and moss. So it's covered up very quickly."


Oil report

The State Government's most recent review of Tasmania's onshore oil potential was compiled nine years ago and was also sceptical. It records almost 140 reported sightings of oil and gas then dismisses them as fakes. The report says some rocks contain tiny amounts of petroleum hydrocarbons but states that, to date, "none of the analysed occurrences of such phenomena constitute a petroleum seep as would be recognised by the petroleum industry".

Mr Sharples says the reports were misinterpretations of things such as organic debris decaying in ponds, forming oily scums. GSLM says the government review was overly sceptical and incomplete because it didn't apply more recent technology such as seismic ultrasound.

Mr Bendall says his company's research inspired Tasmania's oil and gas pipeline across Bass Strait. "Tasmania has a pipeline and can thank Great South Land Minerals for that pipeline because Duke Energy wouldn't have built it if they didn't believe there was oil and gas onshore, " Mr Bendall said. However, a former Duke Energy executive has told Stateline the company did its own research, which did not involve GSLM.


Church links

GSLM is a wholly owned subsidiary of the American exploration company Empire Energy which has links to evangelical churches. The partnership first developed after Malcolm Bendall's apparent vision from God. Clive Burnett says very little church money goes into the company and Mr Bendall has a professional approach. "Whenever I talk to him, he knows better than to start talking about religion. He only talks to me about geophysics, geology, geochemistry and science," Mr Burnett said.

Despite seemingly endless delays and requests for more money, many shareholders seem optimistic. Eddie Fisher bought shares five years ago and bought some more recently. "We're getting so close now, I really believe we're about to get it." Noel Young agrees. "You've got to take the gamble and there's no point investing in it if you're not confident they'll find it, and I think they will."

Len Swan was GSLM's Operations Officer until two months ago and is less positive. Mr Swan worked for the company for two years and says he was sacked after what he calls 'disagreements'. "The company hasn't gone forward at all. Malcolm Bendall's been living in other countries around the world," he said

Malcolm Bendall is outraged at the claims. "The story's a lie. Last year, I had 58 international flights and I was 24 hours in the air which means I was perpetually jetlagged. I spent all of ten days in Monaco last year, I hardly call that a high life." Mr Bendall told Stateline he is staying at a Holiday Inn in London and has mortgaged his house to raise money.

Mr Burrett defends his boss. "Malcolm has put his own money into the company and has taken very little from it. I think any allegations that he's been living high on the hog are ridiculous."

Investor Eddie Fisher was also eager to support Mr Bendall, saying "I believe he's put millions of dollars into this. That's what I've just been told."

Len Swan claims GSLM owes millions of dollars and hasn't paid superannuation since the middle of last year but Clive Burrett insists everyone has received their entitlements, and the workforce is growing. "We do owe some money and we are working very hard. We've paid most of our creditors at least some. We've paid our drillers $4 million and we will be fulfilling our obligations."

The company needs quick progress to secure a full mining licence in six months time or disappear from Tasmania. Mr Bendall is confident of obtaining the new licence. "Having doubled what we committed to do, we would expect to have a favourable response from the Tasmanian government in applying for those areas."


Parliamentary questions

Concern over the company's existing licence has flared in State Parliament with the Tasmanian Greens producing an undated draft ministerial briefing note.

On March 5, Greens MP Kim Booth asked "Minister, can you confirm that since January 2003 the Government has had serious concerns regarding Great South Land Minerals limited's ability to comply with its exploration licence?" Resources Minister David Llewellyn replied "Mr Speaker, look I think that's an outrageous thing to have done under parliamentary privilege in this chamber."

The note shows the former Resources Minister Paul Lennon was advised the company was not meeting its expenditure commitments in searching for oil. Mr Booth has told Stateline "apparently Mr Lennon was so concerned, he was going to knock them off."

In a statement, Mr Llewellyn has confirmed there were concerns about non-compliance but says "revocation of the licence has previously been considered as an option but further discussions and negotiation with the company on its work plan have avoided the need to proceed down this path."

Malcolm Bendall says the department was mistaken. "In fact, what had happened is that our expenditure hadn't been properly recognised and our reports were sort of mislaid within the department. So it was based on misinformation."

Mr Llewellyn's statement also says a lack of companies wanting to search for oil has given GSLM some leeway. "In the spirit of the special exploration licence category, which is to facilitate 'frontier' exploration activities, the government has sought to be flexible and accommodating where it is appropriate and reasonable to do so," Mr Llewellyn said.

The Greens are still concerned. "I'm very concerned that were it to be extended, by some contrivance of the government, that they would have to be absolutely satisfied that mum and dad investors haven't put money into a company because of the fact that the government appears to be underwriting them," Mr Booth said.

Malcolm Bendall says 10 billion barrels of oil at stake and others are trying to get in on the action and sabotage his company. "I've had my house broken into. I've had death threats. You know, there's a dirty, very dirty game that's been played with this project and you know, at the end of the day, those cowards will be shamed."

"I intend to use my right-of-reply in parliament to expose those people and also expose the litany of lies and misinformation that's surrounded this project," Mr Bendall said.

For now, the company is exuding optimism but Clive Burrett admits time is running out. If GSLM finds nothing worthwhile in its first two drilling missions, Mr Burrett says, it is likely to spell the end for the company and it's enduring shareholders.

Tags: oil-and-gas, tas, miena-7030