IND - Indus Energy

[basilio]

Re: QPN - Quest Petroleum

Not happy with with what is happening with QPN.

I decided to directly ask for further information from the company. If any other shareholders believe we are owed some actions perhaps you could consider doing likewise. I have pasted a copy of my correspondence.

To Board and CEO QPN

WHEN WILL YOU BE DRILLING ?

I, like many other investors, were impressed with the potential of your South Sumatra leases. It certainly seemed to be worth a punt.

On your website in your initial story you believed you would be drilling by June 2012. As a result of that information your shares ramped up significantly to over 1c. You also took the opportunity to raise further funds at .006c.

This date came and went and then later in 2012 we were told that drilling was imminent by December 2012.

Again December came and went with no action but a steady decline in SP.

In 2013 you finally announced purchase of the land on which you were proposing to drill. Great ! But it does beg the question of how such a detail was ignored/overlooked in the early plans for development.

So in June you announced settlement on the property. I would have imagined that preparations for drilling had been undertaken in tandem with the settlement of the property so that activity could commence ASAP.

But its now September and we havn't heard a peep. All we do know is that
1) QPN now has a significant management overhead cost that is quickly reducing capital
2) The SP has fallen by 50% as market confidence in your capacity to actually use shareholder funds for the purpose they were raised (ie drilling for oil/gas) diminishes.

I look forward to hearing from you ASAP as to the status of current exploration.

Your sincerely

 

[newanimal]

Re: QPN - Quest Petroleum

nice work Basilio, been thinking about communicating with qpn directly for a while myself as to wtf is up. If they (management) are operating in good faith and are merely hampered, stalled with ironing things out re property access (title??) , "business" issues with government, etc., I'd expect such reputable pros and ringers to be communicating more responsibly and transparently with investors and shareholders.
will follow suit after your example

 

[Mr Jed]

Re: QPN - Quest Petroleum

Excellent letter Basilio. I agree with it. While shareholders deserve a massive improvement in communications from the Management, I know a number of large shareholders and none of us have sold.
I hope you get a reply to your comments but I doubt it.

 

[basilio]

Re: QPN - Quest Petroleum

Excellent letter Basilio. I agree with it. While shareholders deserve a massive improvement in communications from the Management, I know a number of large shareholders and none of us have sold.
I hope you get a reply to your comments but I doubt it.

We'll see. If I don't get a response (very) soon I will reforward it and ask when will there be a formal response and if not why not.

At the very least I believe all shareholders are entitled to an update on current progress given that settlement of the drill site occurred in June and all things being equal we should have expected significant progress to drililng.

The SP is now absolutely RS at .002. That is a big hit from the .006-.1 of last year.

 

[Mr Jed]

Re: QPN - Quest Petroleum

I wish you every success as if you do succeed it will be a major shift for the company as I know many have been forwarded on to the MD but little emerges.
There have been unplanned delays and possible background developments that have stalled the company but I would expect the company should now be on top of the delays and hopeful a positive change of direction is near.

 

[Paavfc]

Re: QPN - Quest Petroleum

QPN has been a disaster of an investment for me.

59,000,000 shares sold down today, something is not right here for sure.
Supposed to have drilled last year bad bad way to run a company....

 

[basilio]

Re: QPN - Quest Petroleum

QPN has been a disaster of an investment for me.

59,000,000 shares sold down today, something is not right here for sure.
Supposed to have drilled last year bad bad way to run a company....

All dropped in the last 5 minutes. Looks like 2-3 big sellers.
In value it is $110k which is not a huge amount but in the circumstances doesn't look good.

There has to be a statement imminently to explain the current situation and clarify what is actually happening

 

[Mr Jed]

Re: QPN - Quest Petroleum

All dropped in the last 5 minutes. Looks like 2-3 big sellers.
In value it is $110k which is not a huge amount but in the circumstances doesn't look good.

There has to be a statement imminently to explain the current situation and clarify what is actually happening

I read it as one seller and doubt it was Palmer. Its sad to see long term holders lose patience after supporting the company through the offer last year.

There is something major going on IMO that would explain the companies actions, I just hope its good and we find out quickly.

 

[basilio]

Re: QPN - Quest Petroleum

Another big sell off today with the SP now at rock bottom .001c.

And this in an exploration company which has yet to actually drill a bit in anger and still pays its executives $1m a year.

xxxxxxxx sssss

 

[kiril]

Re: QPN - Quest Petroleum

I am providing this update for QPN shareholders as an outline of discussions that I have had with various company representatives over the last week.

3 Weeks ago I emailed our CEO, Anthony Milewski asking for either a meeting should he be in Indonesia, or a discussion via telephone. This email, much like many others sent by supporters of our business was ignored.

My personal life experience has taught me that you are just as much to blame in these situations if you stand by and do nothing…so I have decided to take massive action.

I spoke to a very well respected mining analyst I once worked with in Perth, whom I explained the current situation with QPN to. I asked him to introduce me to an oil & gas executive who he has known for some time, and has worked for the majors in Asia.

This introduction then started the wheels turning for me regarding bringing about some change at QPN. After 2 discussions and a fair amount of due diligence, the executive came back to me with some very encouraging opinion about QPN’s prospects, and indicated he was interested in getting involved.

My thinking at this point was that the current board has been given ample time to communicate with its shareholders about the delays of the last 18 months. I am of the belief that we are all big enough to accept that delays happen, especially in this part of the world. What we can no longer accept is being treated like mushrooms.

Last week I emailed the company secretary with my proposal to make board changes. In order to replace our CEO, we require at least 50% of votes. Because I wanted to minimise the cost to the business of calling an EGM, and issue the company with a notice pursuant to Sections 203D of the Corporations Act to do so, I requested that the CV of my proposed new director be added to the AGM pack and put up as a resolution for voting.

That morning I received an email reply from the secretary telling me that AM will be calling me.

AM did call me and we talked for around 5mins. In short, he asked me to wait until the company report was released, and that he would then call me afterwards to discuss. My explained that I doubted very much that the release of the report would change anything in my mind, as no new information could be contained in it as it covered a period of time now past, and that any new information would need to be released via ASX.

Well, the report was released the next day, and yes, it does feel like they tried to include some new news to help pacify shareholders.

AM, true to his word did call me again yesterday to continue our conversation. Here is a summary:


The seismic data only appeared after they purchased the land…they didn’t know it even existed prior to that. I pushed him for a drill date….even an estimate and he would not be drawn on that.

He did agree that the seismic interpretation should all be complete in no more than 2 months.

I kept raising the issue regarding a cap raising and that they have now burnt all their supporters and hence will not be able to get a cap raising away. His answer was that we will cross the bridge when we come to it.

I said to him that basically their strategy is one of hope….we use all the cash left to identify the best place to drill our maiden hole and then we drill. We then prey that we hit gas otherwise it’s all over. He basically agreed but did keep swaying me to the idea that the seismic should be pretty good. I said if it was, why didn’t the previous owner of the land drill it, since that data is 20 years old. He said the previous owner was the government (that’s news to me) and that the price of oil has increased since then so the economics are now better.

I asked about Moyes relationship…and he said they are bringing them opportunities but in this climate they need to be very selective and my feeling there is nothing going on there either.

He also mentioned that Ken is working round the clock on the Indo situation…..he kept trying to tell me that unless you have worked there, you wouldn’t understand how long things take there.

He asked what my intention was about nominating new directors onto the board. I explained that the only one I was looking to change was him.

He squirmed a bit and said well you understand that it’s not me, it’s a team effort…we are a team. I said no, you lead that team and for the 12 months you have been leader your communication has been unacceptable, we are all big boys and can handle the delays, we can’t handle being ignored. I told him I was in Indo 2 weeks ago, emailed him for a meeting and he ignored my email.

He said that I can call or email him any time and he would respond going forward. I said he will be making more effort to communicate with shareholders.

AM asked me what I would now do if I was in his position, and I answered I would do the same thing re trying to obtain and interpret seismic now that it has come to light.

Basically I said I was prepared to give him the next 2 months to complete the data interpretation, and that we expected improved communication.

Summary:

I still feel particularly bullish about our prospects and for this reason I am still on board.
I expect we will start to see a better level of communication from the management team. Looking at the map of who all our neighbours are tells me everything I need to know about the opportunity and why I am still here.

Kiril

I hold

 

[basilio]

Re: QPN - Quest Petroleum

Kiril that was a great job. Thank you hugely !

One of the supposedly convincing points of this project was the presence of Dr Thurmin (?) We were given to understand that his contacts and experience would play a significant role in this development.

So far that doesn't seem to have happened.

I'm still wondering at the unwillingness to even guess at a drill date. Have they started discussions with drilling companies? Are they available ? Are there logistic issues (Every statement to date says it is an easy drill. Is this correct ? Will they actually drill on the land they have purchased or could teh sesmic results indicate another location ? )

With regard to Moyes I have my doubts about their value. HOG used their analysis for the developments in the Ukraine. After one excellent well they have gone downhill with a vengeance.

I'm also very concerned with the salaries management are paying themselves while there is little perceived activity. I suppose in the past I have just noted examples of mining companies which exist purely for the benefit of the directors. Now that I am the one being taken for a ride the issue is far more relevant...

Really hope your intervention is sufficient to move this project along and look forward to a more proactive management - or a change of management.

Cheers

 

[basilio]

Re: QPN - Quest Petroleum

Kiril I believe the option of changing the CEO should still be on the table. It would be great to see a substantive change in communication and progress over the next 2 months. But how likely is that ?

I also have a troubling question about the promises made to drill in December. The statements released by management in October 2012 promised imminent drilling. It was that promise that supported the capital raising at .006c.

I would like to know on what basis these statements were made and what material changes occurred that resulted in the delays. The fact that there is still no drill date in sight is also disturbing.

http://www.proactiveinvestors.com.a...nd-gas-well-with-bpmigas-approval--34543.html

http://www.proactiveinvestors.com.a...south-sumatra-oil-and-gas-drilling-35847.html

http://www.proactiveinvestors.com.a...f-indonesian-oil-and-gas-well-site-44199.html

 

[Mr Jed]

Re: QPN - Quest Petroleum

I am providing this update for QPN shareholders as an outline of discussions that I have had with various company representatives over the last week.

3 Weeks ago I emailed our CEO, Anthony Milewski asking for either a meeting should he be in Indonesia, or a discussion via telephone. This email, much like many others sent by supporters of our business was ignored.

My personal life experience has taught me that you are just as much to blame in these situations if you stand by and do nothing…so I have decided to take massive action.

I spoke to a very well respected mining analyst I once worked with in Perth, whom I explained the current situation with QPN to. I asked him to introduce me to an oil & gas executive who he has known for some time, and has worked for the majors in Asia.

This introduction then started the wheels turning for me regarding bringing about some change at QPN. After 2 discussions and a fair amount of due diligence, the executive came back to me with some very encouraging opinion about QPN’s prospects, and indicated he was interested in getting involved.

My thinking at this point was that the current board has been given ample time to communicate with its shareholders about the delays of the last 18 months. I am of the belief that we are all big enough to accept that delays happen, especially in this part of the world. What we can no longer accept is being treated like mushrooms.

Last week I emailed the company secretary with my proposal to make board changes. In order to replace our CEO, we require at least 50% of votes. Because I wanted to minimise the cost to the business of calling an EGM, and issue the company with a notice pursuant to Sections 203D of the Corporations Act to do so, I requested that the CV of my proposed new director be added to the AGM pack and put up as a resolution for voting.

That morning I received an email reply from the secretary telling me that AM will be calling me.

AM did call me and we talked for around 5mins. In short, he asked me to wait until the company report was released, and that he would then call me afterwards to discuss. My explained that I doubted very much that the release of the report would change anything in my mind, as no new information could be contained in it as it covered a period of time now past, and that any new information would need to be released via ASX.

Well, the report was released the next day, and yes, it does feel like they tried to include some new news to help pacify shareholders.

AM, true to his word did call me again yesterday to continue our conversation. Here is a summary:


The seismic data only appeared after they purchased the land…they didn’t know it even existed prior to that. I pushed him for a drill date….even an estimate and he would not be drawn on that.

He did agree that the seismic interpretation should all be complete in no more than 2 months.

I kept raising the issue regarding a cap raising and that they have now burnt all their supporters and hence will not be able to get a cap raising away. His answer was that we will cross the bridge when we come to it.

I said to him that basically their strategy is one of hope….we use all the cash left to identify the best place to drill our maiden hole and then we drill. We then prey that we hit gas otherwise it’s all over. He basically agreed but did keep swaying me to the idea that the seismic should be pretty good. I said if it was, why didn’t the previous owner of the land drill it, since that data is 20 years old. He said the previous owner was the government (that’s news to me) and that the price of oil has increased since then so the economics are now better.

I asked about Moyes relationship…and he said they are bringing them opportunities but in this climate they need to be very selective and my feeling there is nothing going on there either.

He also mentioned that Ken is working round the clock on the Indo situation…..he kept trying to tell me that unless you have worked there, you wouldn’t understand how long things take there.

He asked what my intention was about nominating new directors onto the board. I explained that the only one I was looking to change was him.

He squirmed a bit and said well you understand that it’s not me, it’s a team effort…we are a team. I said no, you lead that team and for the 12 months you have been leader your communication has been unacceptable, we are all big boys and can handle the delays, we can’t handle being ignored. I told him I was in Indo 2 weeks ago, emailed him for a meeting and he ignored my email.

He said that I can call or email him any time and he would respond going forward. I said he will be making more effort to communicate with shareholders.

AM asked me what I would now do if I was in his position, and I answered I would do the same thing re trying to obtain and interpret seismic now that it has come to light.

Basically I said I was prepared to give him the next 2 months to complete the data interpretation, and that we expected improved communication.

Summary:

I still feel particularly bullish about our prospects and for this reason I am still on board.
I expect we will start to see a better level of communication from the management team. Looking at the map of who all our neighbours are tells me everything I need to know about the opportunity and why I am still here.

Kiril

I hold

Great report Kiril. All actions seem to be leading to a farm-in.

 

[kiril]

Re: QPN - Quest Petroleum

In my discussion with AM, I mentioned that a source on the ground whom is very reliable had canvassed all the rig operators in the region and word was the QPN had NOT yet spoken or engaged with a local operator. He stopped me at that point rather passionately and absolutely denied that to be the truth... stating that they have had detailed discussions with a rig operator. I guess as CEO, for him to say this to me it must be true. It will be recorded in the board minutes...as one of the greatest minds to ever come out of Macquarie Bank always says...."everything is on the record".

Regarding having the CEO replaced, we need 50% of shareholders...which I think we will have.

I have well over 5% in my group of investors.
I am also in touch with another group that has around 7% of the register.

I will contact each of the top 50 that I don't already know and state our intention.

However, lets not jump the gun. AM has come full circle with his response to me and others from what I am hearing. I gave him a 2 month commitment and will be true to my word. I just hope he is too.

Kiril.

I hold.

 

[Country Lad]

Re: QPN - Quest Petroleum

Regarding having the CEO replaced, we need 50% of shareholders...which I think we will have.

Just curious, which section of either the Corporations Act or the company's Constitution allows shareholders to force the replacement of the CEO? Directors, yes, but never heard of it regarding a CEO.

Cheers
Country Lad

 

[kiril]

Re: QPN - Quest Petroleum

Hi Country Lad.

To answer your question, there is no such provision under the Corporations Act.

The CEO cannot be removed by shareholders as it is a Board appointment (if he is a director, he can be removed as a director but would remain as the CEO unless he resigned or was removed by the board).

Under S.203D of the Corporations Act I can write to the board with proof that I represent greater than 5% of the issued capital in QPN and request an EGM. Under s249D of the Act I request that the Company call a meeting to consider and if thought fit resolve that the following person be removed as a director under s203D of the Corporations Act.

This will require that the meeting be called within 21 days under the Corporations Act and give notice that should the Company fail to do so, I will call the meeting under the provisions of s249E of the Corporations Act.

Now once the vote is cast and if carried to remove the CEO as a Director, and my candidate is elected, we have a situation where the CEO is CEO but not director. Clearly a substantial show of no confidence by the shareholders, and by this time very public as the media loves a good boardroom battle. You would hope either the CEO steps down, or the board decides to listen to their shareholders and replace him.

If this does not occur, I could use the above to spill the entire board or enough of the board to gain control.

Either way, this not something any board wants to go through, when all they need to do is start communicating with its stakeholders, and start demonstrating value.

Kiril.

I hold.

 

[Country Lad]

Re: QPN - Quest Petroleum

Hi Kiril

Hi Country Lad.

To answer your question, there is no such provision under the Corporations Act.

The CEO cannot be removed by shareholders as it is a Board appointment

Yes that is what I was getting at.

This will require that the meeting be called within 21 days under the Corporations Act and give notice that should the Company fail to do so, I will call the meeting under the provisions of s249E of the Corporations Act.

I am not trying to tell you how to suck eggs, but you need to be a little careful about the period of notice. Section 249(H)3 says that there must be at least 21 days notice for a motion to:

(a) remove a director under section 203D; or....​

Section 203D says partly:

(2) Notice of intention to move the resolution must be given to the company at least 2 months before the meeting is to be held......​

although it is ambiguous about the time frame, but is intended to allow for all the procedural stuff like the Director has the right to put his case to the shareholders.

Does the Company's Constitution make mention of the type of resolution for the removal of a director? Most Constitutions I have been involved with require the removal of a director to be a Special Resolution requiring 75% approval.

Now once the vote is cast and if carried to remove the CEO as a Director, and my candidate is elected, we have a situation where the CEO is CEO but not director.

I would not like to be your candidate. If the CEO has the confidence of the rest of the board, and the board would have to stand by the CEO otherwise they would look stupid for not getting rid of him before, then your guy would be simply a dissenting director and could very well be ignored by the other directors.

Having resigned from a board because the other directors refused to put in place adequate corporate governance and risk safeguards, I can tell you it is not a good place to be.

Cheers
Country Lad

 

[kiril]

Re: QPN - Quest Petroleum

I spoke with the company secretary and emailed him regarding the constitution. I told him I did not wish to see the company incur additional costs regarding the calling of an EGM if the constitution allowed for me to have this delt with in the up coming AGM, to which JW agreed, and said he would be happy to play ball and include my candidates CV for all shareholders to make their own judgement.

Regarding the vote, my Corps Lawyer told me its 50%.

Regardless, I am a reasonable guy and always believe that people will do the right thing.....sometimes with a little force. Am hoping we don't need to go down this path, but at the same time I am prepared for it.

Kiril.

I hold.

 

[basilio]

Re: QPN - Quest Petroleum

Excellent Kiril. Will certainty back you up if and where necessary.

Hopefully the Board will re evaluate the situation and ensure we see some value for our investment rather than watching it disappear into troughs.

 

[basilio]

Re: QPN - Quest Petroleum

December is approaching quickly and still nothing of significance from Quest.

What I did notice today was that someone decided to buy around $31,000 of shares at full price (.003c) . Nice vote of confidence... versus the bailout of 31m shares earlier this week.

Any news/whispers folks ?