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Gold/Mining/Energy : coastal caribbean (cco@) -- Ignore unavailable to you. Want to Upgrade?

To: Robert Furman who wrote (565)	10/2/1998 2:18:00 PM
From: Tom Frederick	Respond to of 4686

Mr. Furman, I don't see how the state could make this go away. And I said before, it would seem that most if not all of the options are being exhausted (as I understand it, this could be the final appeal, which is a Florida State Supreme Court appeal). I agree that the state will not agree to any astronomical settlement, but, they will also know that if push comes to shove, CCO could bring this to the U.S. Supreme court and push for a "takings" case if the State does not come up with a reasonable settlement or an OK to drill. I do believe that if the reserve continues to prove to be unusually large, the state will be hard pressed to walk away from the tax windfall and that would bring up some kind of negotiation, possibly in the form of giving up a percentage of the leases for some price and then only exploring the richest potential site with an eye on minimal equipment and development and therefor minimal environmental risk with maximum financial benefit to the state. That is just my opinion. I'm thinking economics and politics and how this could play out. Tom F.

To: Robert Furman who wrote (565)	10/2/1998 2:48:00 PM
From: Edwin S. Fujinaka	Respond to of 4686

Bob,...The State has already been doing everything they can to prevent CCO from drilling on the leases they sold to CCO with the proviso that CCO had to drill every year or face losing the leases. The State's behavior has been outrageous if not fraudulent. If this isn't "bad faith" business dealing by the Government, then what is the meaning of bad faith? One of the ways that the State might avoid paying out a huge sum of money up front might be to just pay out a modest amount (like a billion dollars) and leave the leases just as they are with an extended time to expiration which doesn't begin to toll until a drilling permit is approved by the State. For the cash payment, CCO could agree to defer drilling until the State agrees to permit drilling to proceed. This will leave the CCO stock with a residual value which is based on the future value of the leases if and when the State finally approves drilling. A cash payment up front will validate CCO claims and if the cash is retained in the Company (rather than being paid out to shareholders as a one time dividend) the shareholders can decide when to take capital gains at their own convenience. The stock price will reflect the value of the cash on hand plus the future value of the leases. With a billion dollars in cash AND the restricted leases the CCO stock ought to be selling in the $20+ range. Perhaps plus a lot (especially with Bush as Governor).