Bula Resources has sought to clarify a number of points arising out of the inspector's report, which it claims has contributed to the creation of an "incomplete view" of the role and actions of its officers.

Solicitor, Mr Jeremy Nieboer, outlined his concerns to Bula director, Mr Pat Mahony, regarding related party issues associated with the proposed acquisition of Mir Space. Mr Nieboer stated that Mr Stanley had previously sought advice from him in relation to related party disclosures. Bula states that the "incorrect impression" could be drawn from this section of the report that Mr Mahony ignored Mr Nieboer's comments and views and that Mr Nieboer continued to hold this view during the due diligence process.

"The matters raised by Mr Nieboer were one of the main reasons why the due diligence committee acting on the advice of the company's then solicitors, LK Shields took the unusual step of confronting Mr Jim Stanley with the allegation that he or any member of his family held an interest in Mir Oil," according to yesterday's document. Mr Stanley made a clear statement to the committee that neither he nor any member of his family held an interest in Mir Oil and it further sought and received written confirmation thereof.

On its decision to build a pipeline to Well 705 in the Salymskoye oilfield in Russia before a commercial flow of oil have been achieved, Bula states it was a "low risk" development expecting production would be 5,000 barrels of oil a day. The inspector noted it was "somewhat surprising" to have gone ahead with the construction before the test results were known. But Bula insists climatic restrictions necessitated the construction of such a pipeline during the winter period of early 1996.

It also takes issue with the inference in the inspector's report that the falsification of the results of Well 705 in the Smlmyskoye oilfield was brought to Mr Mahony's attention in December, 1996. It insists he only learned of the falsification on April 9th, 1997.

Bula also insists it maintained the required registers detailing shareholding under Company Law at all times, a matter on which the inspector had criticised it.