• In the Sacramento Basin, California, USA, the Dempsey 1-15 appraisal and exploration well completed drilling activities and was connected to production facilities post quarter end (18 July 2018) producing approximately 1,300 mcf per day according to the operator.
• On 29 August 2018 the operator of the Sacramento Basin activities further advised the Dempsey 1-15, some water accumulated in the well bore and reduced gas production. Production of gas from the Dempsey well has been shut-in temporarily for pressure build-up as a means to clear water from the well bore before recommencing gas production.
• The Company entered into a Binding Letter of Intent on 7 May 2018 to dispose of its working interests in the Dempsey Project Area to Raven Energy Limited (“Raven”; ASX:REL) for part cash and shares totalling approximately AUD$1.2m. The terms of sale were altered post half year end which included an additional non-refundable deposit being paid by Raven and half the shares (AUD$250,000) being paid upfront to Xstate. The balances of payments (Cash USD$410,000 and shares AUD$250,000) are to be received no later than 31 October 2018. Further information may be found in the Company’s release to the ASX on 17 August 2018.
• Production for the 6 months ending 30 June 2018 was 162,107 million cubic feet gross (21,244 million cubic feet net to Xstate). Production during the first half benefited reflects prior wells having been brought online as part of the well work program focused on increasing production from the idle well portfolio as well as commencement of production form the Dempsey 1-15 well.
• Xstate is pursuing a range of growth opportunities focused on expanding the Company’s asset base in its core Sacramento Basin region and acquiring conventional oil production onshore North America. The Board remains confident of closing a favourable transaction although timing is uncertain as commercial in- confidence negotiations continue.
• The Company’s activities during the half-year ending 30 June 2018, continued to be dominated by our legal action against the three Singaporean defendants. During and post period end, the Company’s Singapore lawyers attended scheduled Court hearings in relation to uncovering the assets of the defendants to satisfy the Judgment which has been entered against them in favour of Xstate and pursuing committal proceedings against Tanzil Hidayat and Hong Hung Thiam. Xstate will continue its endeavours and determination to take all reasonable legal steps available to the Company to pursue the defendants for full recovery of the Australian judgment debt worldwide. The Company will continue to keep shareholders fully informed of its progress.
• As at 30 June 2018 the Company held cash and cash equivalents of $0.412m.
• As at 30 June 2018 Xstate had 783,490,897 shares on issue and 1,593 shareholders. The top 20 holders held 376,790,139 shares representing 48% of the Company’s issued capital.
for me, the production numbers dont add up on dempsey, anyway, the status appears to be that it has both a water problem that was never previously disclosed and also its production has dropped off also, so the well appears to be shut in.
singapore is not resolved, and criminal committal proceedings continue as well as pursuing the judgement itself.
the board is confident of closing a transaction very soon, so negotiations continue on that currently..
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