Agentm,
Just wanted to thank you for your continued news flow and analysis - it's appreciated. I've sold out of a lot of stocks over the last few weeks (need dry powder), including MAD (another Texas play) but I believe that even if we have a continued slump in oil price that TXN can still move a lot higher over the next 6 months given the potential of the Wilcox.
thanks boff..
there are the usual suspects whom have no understanding of the efs, awp olmos or awp wilcox.. and blast anything i post, but i still dont see them posting any research to back up their allegations..
i research the efs, the olmos and the wilcox in the awp field, and along with texon, i see the results coming in that keep me convinced that there is oil in the wilcox, olmos and efs that is very very valuable, far more than the market is prepared to price texon today..
we are all convinced texon will be monetising the efs asset
once the 4th efs well is flowing and possibly a further well will be drilled early next year..
many holders of the share i talk to are convinced that texon would be moving on that even at this moment, and that it could be a work in progress. pure speculation, but its on their minds
i am convinced texon, and more to the point, john armstrong has made it perfectly clear that they are absolutely going to achieve the best value for the efs they can for the shareholders. i know of no one that is objecting to it..
if you do the rough maths on the latest efs acreage moves in the past month alone, you will see the worse case scenario on the price per acre would make things very interesting for texon should things happen today and texons sp remained as it is..
this from riche on another forum
Interesting to see RBS grabbing hold of the chariman's comments in the AGM about possibly realising value with what I can only assume would be a land transaction. (I've been watching the share registry and there is no evidence of a hostile attempt and a freindly would require more that a 30% premium to the current market price or RBS would torpedo it = nothing left but a land sale or farm in). I've seen them refer to John's comments in a number of recent communications.
I've been pondering about what the price would/could be:
With 4 producing horizontal wells (assuming #4 comes on line next week...) the cost of each is say $8.5m and an EUR of 425-475,000 boe - I'd have thought the minimum you'd accept for them is say $10.5m each? = $42m
Then the rest of the EFS acerage = 5900 - 320 (4x80acres for each of the wells above) = 5,580.
Then given that recent transactions have been trending towards $24k/a (and regardless of the fact that these are mostly PUD which I'd have thought would command a higher premium) =5,580 x $24,000= $134m
total = $134m + $42m = $176m
Tax would be interesting = usually 30% but there are a rack of tax losses in the company that may be able to offset some of the gain. Don't have enough info on that so I'll leave it out for this calc:
With 245m shares thats just under $0.72 per share. And then we've still got wilcox et al + seitel data - oh and $25m odd in the bank!
Crazy compared to the current share price. If the company does pull off a transaction the rerating will be fun.
Obviously nothing but my ponderings ... just thinking out loud.
what riche points out is all very interesting indeed.. texon is around the .47 mark right now, so a sale of the efs on just 24k an acre means cash alone to the value of .72 per share!!! wow
there is conjecture that given the amount of wells in place, that texons field development of those efs acres may be able to achieve value far north of the 24k per acre riche discusses
i hear a lot from my texan friends that there are all sorts of different types of players looking at the efs, from various types of financed investment platforms and groups, to mid tiered oilers expanding their boundaries and of course we see the majors soaking up more acres, and some heavy hitters have been arriving on the efs in the past few years..
makes for some intriguing days ahead, could be weeks, could be months, who knows!!!
my view on texon is that i could never sell a single share now.. i absolutely believe that the value in the share is not being seen. with risk being so heavy a factor in the markets right now, texon is really standing out and trading as a highly speculative share still today despite its amazing recent results.
i have full confidence in the board, and i think texon will deliver upside for me.. plenty out there are selling the share down bigtime and we know the top 50 are only adding.. except 1 holder.. interesting that the top 50 are not abandoning this puppy with a meltdown out there..
so how will it pan out for the investors? imho texon can deliver some pretty healthy value in the very near future, and i am very keen to see how it all ends..
best of luck to the holders on the share..
cheers