TXN 0.00% 58.0¢ texon petroleum ltd

hoskins efs 4h spud, page-4

  1. 1,370 Posts.
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    It seems that TXN's forthcoming wells are quite large (length, # of fracs). It gets me thinking of reasons why and how (funding source) TXN is drilling these large (and probably expensive) wells. My thoughts are:

    1. The trend (I think) is for horizontals to be longer and have more fracs due to increasing cost effectiveness, so the size of these wells is consistent with the trend.

    2. TXN now has funds to drill bigger wells.
    (Question: Does anyone know where TXN is getting the funds? We know SEA is covering costs, but are they paying directly or does TXN have a lending facility now that SEA is essentially guaranteeing coverage of these costs?)

    3. TXN (with SEA's encouragement) is deliberately developing bonanza wells to boost TXN's and SEA's share price at a critical time (merger and demerger).
    (Note: Built into this explanation is the tacit agreement that TXN will not consider other offers.)

    Also, TXN's past initial IP rates for Eagle Ford were between 1200 and 1500 boepd. Any guesses what might be forthcoming (assuming the choke isn't opened up)? Maybe an initial IP of 2200 boepd?

    I look forward to other views on why and how (funding source) TXN is drilling these large (and probably expensive) wells.
 
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