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XCITE ENERGY

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Date posted 2018-03-08 11:17
Subject OGA Letter 
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Thanks to Beltron on LSE- Bought this across simply because the more you read it the odder it looks.


We have considered your request under the Freedom of Information Act 2000 (FOIA) and, where relevant, the Environmental Information Regulations 2004 (EIRs).

Following a search of the Oil and Gas Authorities (OGA£s) records, we have found no record of a meeting taking place on 16 September 2016, involving the OGA and Xcite.

However, on the 8th September 2016, a meeting between the OGA, Xcite and third parties took place.

On 24 May 2017 the OGA received and responded (on 27 July) to a request for the notes of the meeting on 8 September 2016. In its response to that request, the note

Readout of meeting between OGA, DIT, Redacted and Xcite: Thursday 8 September 2016

£Redacted is a Redacted firm that was established in the Redacted. They currently invest in Redacted in Redacted and Redacted; they have investment in Redacted in the UK; and they own the Redacted associated with the Redacted in Redacted. There is no debt or fees associated with their investment and their business model is to work with high quality firms. As there is no debt, there is no default risk. They look to work with an investment grade company for the coupon and for Xcite they have selected Redacted to manage this. They explained that they provide prefunding to try to mitigate any call on the guarantor. They seek to have a fast and efficient process to enable completion.£

4. While no meeting was held on 8 September 2016 between the £OGA, Xcite Energy LTD's (XEL) Board of Directors and XEL's proposed project guarantor£, we can confirm that a meeting between Xcite, the Department for International Trade (DIT), a company whose details are being withheld (further details as to the reasons this information is being withheld is set out below), and the OGA took place on 8 September 2016 at the OGA£s London office. A copy of the note from that meeting is attached to this response at Annex 1 (the Note).

5. Some of the information contained in the Note has been redacted. While the OGA tries to be as transparent as possible, and our general approach is to disclose as much information as we are able, there are at times reasons and circumstances in which the OGA cannot disclose information requested.

6. The OGA considers that the redacted information from the Note is exempt from disclosure pursuant to Sections 36(2), 41(1), 43(2) FOIA and Regulations 12(5)(d) and (e) EIR. A detailed explanation of the reliance on each of the exemptions is set out below.

Section 36(2) £ Prejudice to the effective conduct of public affairs 7. The OGA£s qualified person considers that disclosure of the redacted information (a) would likely inhibit the free and frank exchange of views for the purposes of deliberation (Section 36(2)(b)(ii) FOIA) and/or (b) would otherwise prejudice or would be likely to otherwise prejudice the effective conduct of public affairs (Section 36(2)(c) FOIA). 8. The meeting of 8 September 2016 was intended as a way for those attending to have a safe space to have discussions related to the funding of projects.

9. One of the functions of the OGA, as the regulator of the oil and gas industry in the UK, is to facilitate and take part in discussions on a range of matters (which may, from time to time include discussions on sensitive matters such as the topic of the meeting) in order to achieve outcomes in the best interests of the UK Continental Shelf and Industry.

10. It is necessary and appropriate for those discussions to be conducted in a safe space so that the best decisions can be reached without fear of subsequent disclosure or external interference.

11. In the discharge of such statutory functions, companies in the oil and gas industry and other stakeholders (e.g. UK and International governments) provide the OGA with wide ranging and often commercially and politically sensitive information. The OGA has no statutory power to demand the information provided to it by Industry, and particularly other stakeholders, in this particular context.
12. Further, the OGA considers that, if information which is voluntarily disclosed to the OGA in this way is disclosed as part of this information request, both Industry and other stakeholders would likely not provide such information in the future. This chilling effect would likely inhibit the OGA in the discharge of its statutory functions and thus would prejudice the effective conduct of public affairs.

13. The OGA understands that disclosure of the requested information may lead to interested parties being confident that decisions are taken on the basis of the best available information. However, the OGA considers in this case that the public interest supports the non-disclosure of the information, not least to ensure that the OGA can provide companies with such safe places to explore their funding options, and has before it relevant information on which to make appropriate decisions in the exercise its functions.

Section 41(1) FOIA and Regulation 12(5)(d) £ Information provided in confidence

14. The Note was from an introductory meeting between Xcite, the company in question (the Company), DIT and OGA, which was held at the OGA£s London offices.

15. The purpose of that meeting was to allow Xcite to introduce the Company, who was a prospective investor in Xcite£s Bentley Field. The Companies£ participation in the meeting was on the understanding that such participation would remain confidential and would not be disclosed to third parties or to the public at large.

16. The information contained in the Note, if released, along with other information in the public domain, is likely to result in the identity of the Company becoming known along with the company it recommended.

17. The OGA considers that the circumstances, content and purpose of the meeting had necessary quality of confidence to justify the imposition of an equitable obligation of confidence. Further, the OGA considers that the information communicated in the meeting (including the Note) were communicated in circumstances which created an obligation of confidence.

18. The OGA considers that disclosure of that information over and above the information currently being disclosed would result in an actionable breach of confidence against the OGA, an action the OGA considers would be likely to succeed.

19. The OGA has considered whether it would be in the public interest for all the information contained in the note to be disclosed, which would provide the OGA with a defence to any action for a breach of confidence. On balance, the OGA does not consider that it is in the public interest for all the information in the note to be disclosed.

20. The Note summarises discussions that arose in circumstances of a professional relationship and, as set out above, disclosure of this information would likely affect a continued supply of information from Industry and other stakeholders, as well as chill investment opportunities in the UK continental shelf. Section 43(2) FOIA & 12(5)(e) EIR � Commercial Interests 21. The OGA considers that, if the identity of the Company was to be disclosed along with the company it recommended, the commercial interests of those companies would likely be prejudiced.

22. As mentioned, the said meeting was held to discuss the possibility of the Company investing in Xcite�s Bentley field. The OGA considers that should the fact that such an investment was considered, this could damage the reputation of the Company.

23. In addition, disclosure of the Company�s identity may weaken its position in a competitive environment by releasing market sensitive information, information which would be useful to its competitors and which could be used by its competitors to undermine investor confidence in the Company.

24. The OGA has considered whether it would be in the public interest (including the passage of time between the meeting and the date of the request) for the name of the company to be released.

25. In light of the risk to the Company�s reputation, and noting that the matters surrounding Xcite�s liquidation remain contentious, the OGA considers that the public interest in favour of withholding the information outweighs the public interest in disclosing the name of the Company.

26. Please note that other exemptions/exceptions are likely to apply.
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