Repost SH
" pennyoilking13/2/2012 4:32:40 PM | | 210 reads | Post
There is no shortage of info shareholders can access to better understand AOI's situation in Puntland. Everything from declassifed embassy reports to general media releases. These will all have a direct bearing on AOI after they flow oil in the next 12 to 22 days.
What was most interesting was the info on Conoco. Conoco assisted the US military until 1992 there. Conoco had huge pull with the warlords and the powers that were because of the money they were spending in pursuit of oil. Conoco felt they were 1 well away from commercial discovery when the whole country went haywire. A wealth of Conoco oil leads was left behind. Their last well had mechanical failure about 2/3rds to TD and was abandoned.
Conoco Phillips was the largest landholder. Nearly 2/3rds of the country was assigned to Western oil giants including Conoco Phillips, Amoco (now BP), Shell, and Agip. Interestingly, Amoco lands were mostly in northern Somaliland, while Conco Phillips was in Puntland. The blocks now held by AOI were Conoco blocks.
The Somali government begged Conoco to return and Conoco never responded. The last mention of Conoco's interest in Somalia was in their 2002 annual report. The initial terms were for 20 years starting from 1986. So as of 2006 their blocks were in arrears.
On the other hand, Amoco and Shell, whose blocks are also expired claim Force Majeure and they have said they would return if Somalia began stable. Agip is claimed to have known of commercial oil but never released info to the government.
Still playing hard ball, the companies claimed there was No Certainty of commercial oil and continued their waiting game.
It does appear as though AOI has now hit commercial oil. That leaves the big oil companies without an excuse to continue holding out. As we have read, several things are possible. The Chinese want in and they do not care about Force Majeure. CNOOC has met with Somali officials but they did not want to put money down until they knew oil had been found.
The Somalians have reached out again to BP Amoco to get them back. What is most important to AOI is what Conoco plans on doing. If AOI has hit a motherlode, as rumored, Conoco could try to win back their blocks in court. A better tactic would be to join or buyout AOI etal. BP is obviously interested now and all of them now know huge oil deposits lay in wait.
If AOI hadn't drilled this stalemate would have gone on for years longer. I can't see Conoco threatening AOI and Puntland with legal action that they know would come back to bite them in the rear. Conoco certainly does not want to tick off Somali officials with such a claim. I see a friendship soon between Conoco and AOI. The US Government wants in and I don't think they want the Chinese owning the territory.
This bodes very well for AOI shareholders!"
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Red
