orion letter to shareholders

This is the response to the "complaints" put forward by shareholders via Menzies & Partners.

Declaration of interest: I have lost 50% on my OIP investment since this merger was announced, having bought at an average of 15 cents ... so I'm not happy!

I hope that our board is genuine in thinking that this IS a good deal which to me seems not such a good deal. In fact I ask myself why does OIP NEED this deal and the answer keeps coming back .. they don't! Arguments about diversifying risk are IMHO not as important as the obvious fact that GGX is running out of cash and IT needs the merger not OIP. How for example, is merging with GGX going to assist OIP secure a JV to drill Toenda .. it probaly won't and they will most likley still have to drill it themselves .. and their available funds will be spread over a greater number of projects. Give me this deal at a ratio of more like 4+ GGX to 1 OIP and it MIGHT be more acceptable. Ultimately as the merger IS likley to proceed this is the point of contention!!

I would just comment on the responses from the IEs that (note: this is just my opinion and I am no expert on CSG or geology ... so please read my comments with that in mind):

The Independent Experts (IE) have not in my view adequately assessed or valued the csg potential in PEL 455 which ESG/OIP have said after an extensive review is prospective (for conventional O&G as well).

If the IE is correct in saying PEL 6 has been significantly downgraded by the recent failure of Gwydir-1 to intersect a single thick coal and thereby its CSG potential is low ... WHY HAS ESG STATED THAT THE RESULTS WERE HIGHLY ENCOURAGING IN DETERMINING THAT THE MOOLAYMER FORMATION EXTENDS ACROSS PEL 6 AND THEY ARE PLANNING 2 MORE WELLS ON THE MOOLAYMER TO FIND THICKER COALS? If Moolaymer is a loser ... why bother???

Why hasn't the Maules Creek (MC) prospect in PEL 427 been drilled (the extension of Edgeroi)? It has to be THE most prospective part of all its leases????

If this transacton takes place at the current ratio of OIP/GGX and subsequently the CSG potential of PEL 6, PEL 427 (MC) and PEL 455 particularly is found to be better and its value greater than this deal implies ... questions have to be asked.

None of what is argued in this response from the IEs impacts on the basic question we as OIP shareholders need to ask .. and that is "Do we want these GGX assets and are they worth what they say they are and what we are being asked to pay for them"? The blatantly obvious fact is that GGX is running out of cash and it is dressing up its assets to flog to what by any reasonable person would be seen as a "related party". Please ... its insulting to be asked to accept that Langusch is independent because he left GGX and no longer consults to them ... absolute BS! It defies belief that anyone would expect that to be believed!

Its going to be one hell of a GM!!!!!!!

H