has texon taken a red bull?, page-25

trader8888

i think your right on the views of why texon would move from oil to gas, the comments back then were valid, my understandings of the duval field was that it had the potential to deliver high volume gas wells, so perhaps still profitable with low gas prices, but was assessed later as too high a risk with the ever continuing low gas prices.. it lacked support i think, i think the wilcox was very deep there, wells expensive and too high a risk envelope for texon, its up for sale but i doubt anything will happen.. dave didnt have anything on the table other than that project back then really.. i think then texon had no flags to fly other than the olmos sale, the development of the efs for a sale, and i think as performance issues were concerning shareholders, the chairman obviously reacted over a year back to the concerns of many and the changes were made and a new CEO appointed.

i think what texon has done well is to keep the value of the efs in the company. they are not looking at new project and spending capital unless absolutely needed. so even today with the dome project and east texas, i dont think a spend on anything is pertinent until the company itself is aware of how it sits, whether it gets taken over on market, or sells an asset or get a jvp over the line. it obviously wont look at new programs until the unknown unknowns are ironed out..

cliff foss at the agm said the policy of texon to remain as an explorer and not to develop, unless the costs are low enough. and as you put it rightly, "a world class oil field" is something that texon has and i think is being ultra conservative with, and that wont change, i dont think the major shareholders want anything different, and my conversations with the chairman on that point about a full field development on the efs was answered that texon has not the capital in place to develop a play like the efs with the expensive horizontal wells. the high WI and the risk of a single well failure when you holding practically complete WI in a field is incredibly risky. they have a view that texon is an explorer that will find oil fields, and then use minimal capital and to perhaps strategically bring in partners if needed on some projects also, then sell out early.. at the agm cliff foss was sayign they are trying to pay back and reward the long term holders for their investment in texon.. then over a period a few years build another high value oil field and turn it over also..

trader8888, i think the way texon operates also comes from the influence and nod of opprovals from the major holders, which all seem to come through the rbs office in bribane, are they perhaps not supportive of texon being a full field developer of an oil field like the efs in mcmullen.

the options available to texon are to either sell it outright, which i believe is on the cards, or pull in a partner and reduce the risk, which i believe is also a current option.

the performance of texon in exploring oil plays has been pretty good, they have one shale oil field which in my view will potentially deliver some high value upside, and they have a secondary oil discovery in the olmos sands in the awp acreages in mcmullen.

the wilcox was a necessary exploration, low cost and worth a look when you consider that there are 3 wilcox fields all very close by that have delivered 1 mill bo each. i think they were seeing pretty interesting things in the logs and a decision to have a crack at the wilcox was made.

i think texon suffers from lack of public relations, it has none, they have the brisbane rbs guys covering it and occasionally peter stratchan. sort of a one trick pony.

my only view on texon currently is that it has upside potential on the sale of the efs project, after that, who knows, i am curious what they do with texon mark II.. but i am just holding as they move through a sale that i thought, due to the proclamations of cliff foss in late may at the agm, was weeks away then..

i am curious what value wandoo really has for texon in the future, and i do think the management have a few ideas on a few oil plays which can be programmed in the near future..

the details being ironed out at this agm should i think have been done at the agm in may.. perhaps things were still mid term in negotiations in may? who knows

in the absence of anything else, the current discussions on the points in the egm are intersting to discuss. what eventuates has no impact on me really, the board will either get the support of the major shareholders or they wont, and imho anything i do or say has no bearing on anything regarding the egms outcome..

texon has a pretty well qualified oilman in cliff foss, i think he has the abilities, but whether texon mark II will happen or something else is all just unknown now.

if they deliver on any of the 3 potential buyers and deliver a healthy return to shareholders as promised i will have a smile. other than that everything going on with texon and its sale is in the hands of rob douglas and albrecht..