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New World Oil & Gas – staggering (and perfectly timed!) incompetence

By Ben Turney | Tuesday 6 October 2015


Disclosure: I own shares in one or more of the stocks mentioned. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from ShareProphets). I have no business relationship with any company whose stock is mentioned in this article.


NWOGaction, the shareholder action group for New World Oil & Gas (NEW), is delighted at this morning’s staggeringly incompetent announcement from the company. Having previously announced that New World’s Production Sharing Agreement (PSA) comes to an end on 15 October, today it’s dawned on the board that the actual end date for the PSA is 31 October. Arguably this is an honest mistake, but New World has two (yes, TWO) lawyers on its board (Peter Sztyk and Stephen Polakoff, who will both be up for re-election at the AGM), yet still it took “legal advice in Belize” to uncover this basic error. Jesus wept. These men can’t even be bothered to read their own contracts.

With the company’s inevitable AGM around the corner, New World’s directors could not have issued a more perfectly timed reminder as to why they have to go. This company has been beset by idleness, lazy decision-making and embarrassing ineptitude. It is no wonder the directors have refused to call the AGM until the last minute, as they desperately look for any means to cling to their positions.

The good news is they’ve sealed their own fate.

Any delusional view certain directors are fooling themselves with that they have shareholder support is now shattered. There will not be a single objective shareholder in New World that looks at this morning’s announcement and interprets it as anything other than gross incompetence.

The only chance for survival New World’s board now has is to delay the inevitable. The board should have already announced the date for the AGM, but instead is resorting to whatever tactic it can to suspend its execution.

It is time now to bring this game to an end.


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Comments

1 comments

  1. I think the real reason is they realised they were close to the deadline, and went through the paperwork and found the opportunity to add a few more days to delay the inevitable.

    In fact, who says they didn’t apply for an extension and maybe the oil minister noticed the dates?

    At the end of the day the board have cash in the bank,and jobs,and you can only expect them to want to cling onto both, it’s human nature.

    Of course they will delay the AGM, if they drill the money will be gone and they will either find oil, in which case they will probably retain their jobs, or not find oil and leave an empty bank account. for the action group to inherit.


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