fair price, page-5

OXX continues to be unloved. I expect little respite as we are in the Tax loss selling season, not that OXX is traded in any significant way.
Managed to fill a small order at 25 which I am pleased about.

Have a read of the below announcement from TAP which I have edited.

Quote.

Tap Oil Limited (ASX Code: TAP) announced on 4 May 2011 that it had agreed to sell its 25% interest in WA-351-P, for a cash consideration of US$30,154,000 to MIMI. In addition, MIMI were to pay
Tap?s 20% share of the next exploration well in the permit up to a cap of US$10 million (Tap share).
BHP Billiton Petroleum (North West Shelf) Pty Ltd, Tap?s existing joint venture partner, has given notice to Tap that it wishes to exercise its right of pre-emption to acquire the 25% interest in WA-351-P on the same terms and conditions as agreed upon with MIMI.
We are looking forward to working with BHP Billiton to drill the Tallaganda prospect sometime in the first half of
2012.?
Prospectively of WA-351-P
The Operator completed a detailed assessment of the plays, prospects and leads in the permit in 2010 including the 3D seismic acquired in 2008. Over 10 leads and prospects were defined in the Triassic Mungaroo Formation which Tap estimates have a combined estimated mean potential of 2-3 Tcf (gross recoverable) of natural gas. Tap considers that a number of these targets have an estimated probability of success over 50%.

Unquote.

Note that this Tallaganda prospect is estimated to have a "prospective mean resource" range of .8 - 1.3 TCF. Obviously BHP like it to exercise their pre-emptive rights.

What?s this got to do with OXX, well I thought that it was interesting to compare this permit with OXX's WA 323P and
WA 330P which contain the Winchester Prospect. After the farmout to Santos, OXX has 25% and is free carried through more 3D and a drill likely in 2012 as well as to be reimbursed costs of 7m.
From the 31.12.2010 Quarterly they give Winchester an
"Prospective mean resource estimate" of 1.492TCF and 67mmbbls of condensate, with the "best estimates" being a bit lower than this. I am trying to being careful with the terms as I am trying to compare 'apples with apples'.

Now Tallaganda is untested but this is not the case with Winchester. As I have said there is no such thing as a 'sure thing' in this business but this one gets pretty close.
Parker 1 and the sidetrack made gas discoveries on this prospect in the Mungaroo but were untested due to an anchor chain breaking. It is analogous to nearby gas discoveries Seems that they are pretty confident about this one.

OXX unloved trading at 25c giving MC of about 38m. Has cash and near cash of 29cps or about 44m. That is not including the 7.5m due from the partly paids at the end of the year. Lots of permits and prospects, 3 likely upcoming drills at no cost to OXX, and is trading for not much more than TAP got for the sale of their 25% of WA 351P which doesn't look as good as OXX's 25% of WA 323-330P which contains Winchester.

E & OE.

Go figure.