An oil company chief accused of rigging a £7.2 million sterling rights issue yesterday claimed he believed a strike in North America would be the "company maker" for London-based Alliance Resources.
Mr John O'Brien told a jury that despite an initial setback on the gas flow from a newly drilled flagship well, he remained jubilant. The income generated from the natural gas exploited from the field in Louisiana would ease cash flow problems for the asset-rich oil and gas company.
At London's Southwark Crown Court, Mr O'Brien maintained he believed the company's lease to exploit minerals on the field remained intact following a compromise and the Valentine 14 Well 30 miles south of New Orleans was producing gas prior to Alliance raising the money in a rights issue in April 1995.
Mr O'Brien (45), of Midleton, Co Cork, is accused of five charges of forgery, two offences of false accounting and two offences under the Financial Services Act. It is alleged by the Serious Fraud Office that in reality that Valentine 14 was far from being successful and needed to be shut down, and the Alliance lease to exploit 1,825 acres of plantation had been terminated by landlords.
On his second day in the witness box, Mr O'Brien said underdeveloped parts of the Valentine field were seen as "hot" by oil companies. But he maintained he and colleagues in the US had successfully reached a compromise agreement over strict conditions over the lease, which he admitted had been earlier breached. Mr William Clegg, QC, defending Mr O'Brien, asked if on the advice of Alliance attorneys in the US he believed the lease was still in force. The defendant replied: "Absolutely."
The trial continues.
