So getting across this latest report there is plenty to be happy about although it would seem some short term holders are exiting given we have been sold down for two weeks straight. Presumably punters not waiting on the EFS sale result.
The demerger is a great idea to me and holds considerable excitement and potential reward for holders in the next twelve months.
Unsurprisingly the EFS sale has hit a few snags we now know ( rather than assume).
The problem being the swift results and non contiguous nature of the acreages held. Agentm don't suppose you could ascertain the swift well locations and results for us by some means could you? :)
Looking at the well locations in the area I can see a hard nosed oilman not necessarily valuing all our acreages at the same price point.
It is possible these acreages could be less productive than the current well locations and TXN need to prove the locations further rather than sell for less.
Fair enough... drill baby drill!
So now we have a joint venture partner to assist in this endeavour and a line of credit for drilling.
The TXN crew have been working hard on our behalf I must conclude.
Questions I have regarding this are how much is the line of credit and who is our JVP. Again Agentm might be able to help us with the answer here as the JVP is just across the fenceline
Another question is how much is the line of credit ? Not a huge concern as we have some decent cashflow and interest rates are extremely low in the US and the facility is for four years at interest only so payback shouldn't be a problem but a couple of dusters and the situation changes dramatically. Shouldn't the board have informed us the terms of the credit facility when it was arranged under the rules of continuous disclosure?? According to the last quarterly we had nil credit!I would have thought it appropriate anyways unless it was signed off on this week?
Bottom line the EFS arm of TXN looks in pretty good shape production wise and with SEVEN wells scheduled for drilling in NINE months we are in for an exciting time as the news comes in.
So maybe three to six months before the production assets of TXN (EFS) are monetised...I can wait.
All going well with the drilling TXN(EFS) could be worth more than what it is today and we sell the company and move on to TXN (II)
Assets for TXN(II) I like are first rights to the seismic from the Wandoo Prospect Generation Agreement...essential for an exploration company.
Mosman/Rockingham is only 3mm BOE and fairly lowrisk. The forward plan looks to be to drill two wells to further prove up the land and monetize the asset for our other projects.
TXNII East Texas Project hinges on the seismic targeting 38mm BOE at 100% WI. with a wildcat in Q2 2012. So far TXN have had a pretty good strike rate so here's hoping with this one!!!!
TXNII East Texas 4 Project looks very exciting as well.Good nearby production numbers, targeting 11mm BOE with a JVP at 50%WI and terms agreed upon. First well in Q! 2013...WOW
So much to look forward to with this company.Can't see any reason to sell yet I'm sticking around for the news!!!
TXN Price at posting:
46.5¢ Sentiment: LT Buy Disclosure: Held
