Today's announcement by OXX indicating it was withdrawing the Ascalon retention lease application after consultation with the authority is very interesting. The authority has said OXX should continue with the activities under the conditions of the exploration permit rather than a retention lease. I am thinking these exact activities would have been undertaken anyway if the retention lease had been granted. The activities appear to be centred around getting a better understanding of the gas field and how best to extract the gas. Also OXX still has to find some major partners. The bottom line is, nothing has been lost. It's business as usual. More consultants reports and more studies are still required, and the search for suitable JV partners will continue. The question to be asked is, did OXX jump the gun without all the necessary preliminaries? Anyway OXX will now be far better equipped down the track to make the necessary business decisions. Remember Ascalon is OXX's first gas development project. This outcome is another tick for OXX IMHO.
