TXN - Texon Petroleum

[condog]

Agent once again your what i refer to as an early entrant. It carries risk and reward. You learned this on ADI.
You where years to early on ADI and abandoned AUt at the exact wrong time. Your knowledge of the eaglefor is amazing, but so far your timing of investment in the eagleford has been questionable. I believe you got about 20c per share out of AUT and yet its actually grown from 25c to $1.48 int he time ve been in it.

In reference to AUT vs TXN, its simple AUT now are at a premium for a good reason, they have proven reserves, proven acerage, proven operator and multiple wells flowing to sales and about to be cash flow positive from those wells. Sure its growth curve will slow, temporarily, but as you well know in 2011, they have three rigs and a FT frac crew which should technically see almost 1.5 times the 2010 growth, all other factors being equal. 50 wells planned for 2011.

In contrast TXN is in the early stages. Presumably, but not certain its acerage is good, its operator skills ????? but heats the risk v reward trade off. IT is higher risk then AUt, but its also higher reward if it turns out to be great.

I have cast the net over all shale player and so far only SEA and AUT have enticed me to part with my cash.

 

[Agentm]

Not sure why this thread is so quiet?
Have a look at the AUT and EKA thread and the posts and huge interest! These 2 companies are in the Eagleford Shale Gas Business with drilling and success. Their respective SP's have appreciated very well over the last month or so.

A lot of these EFS acreages have now been de-risked through Technological Improvements and Best Practise Innovations that have seen wells drilled faster and achieve greater fraccing results.

TXN are almost a week into their first EFS Well and hardly a murmur from anyone about this. There is about a 3 week wait until we hear if the well has intersected the 40 odd metre gas zone that is prominent in areas right next door them. The fraccing crew should start in November so we should hear results by end of November.

TXN's back of the envelope valuation (compared to AUT based on AUT's share price, acreages held and number of shares on issue) would be up around the $1 mark. It seems that TXN doesn't have the following that other EFS companies do , so scratching my head here?

Regards
Bazollie

agree on what you say bazza

i think the thread may get a little more action in the coming weeks bazza

the well is about one week in atm, real early days right now. and the swift well south of the tyler ranch 1h had some great reports on it from swift, it was heavily choked back and they managed to get a nice flow rate out of it. which certainly indicates the region may not be underchaged..

early money seems to be flowing towards txn atm.. and txn imho will need to be seriously re rated if any of the efs value commences to impact on the share.

early days still..

 

[UBIQUITOUS]

agree on what you say bazza

i think the thread may get a little more action in the coming weeks bazza

the well is about one week in atm, real early days right now. and the swift well south of the tyler ranch 1h had some great reports on it from swift, it was heavily choked back and they managed to get a nice flow rate out of it. which certainly indicates the region may not be underchaged..

early money seems to be flowing towards txn atm.. and txn imho will need to be seriously re rated if any of the efs value commences to impact on the share.

early days still..

Well something is up. There's not much on the sell side at all. I think some AUT money maybe flowing this way.

 

[Agentm]

Well something is up. There's not much on the sell side at all. I think some AUT money maybe flowing this way.

doubt it

the share has been out there for a long time..

it certainly got my cash over the last few weeks.. but its just a case of a share that has to achieve some of its value in a new play EFS as the exploration well is drilled..

they have a small lateral already producing and swift has a fully completed and successful commercial well only a few hundred feet south of the first well for texon.

its being pushed hard by a brokers who have it as their no1 stock pick atm.. so its likely to re rate as the EFS well results come in and the acreages it holds becomes part of its valuation..

this company has many successful wells producing atm, and is turning a profit.. totally in the black atm..

will expect some upside on this one shortly imho

good luck to all holders

 

[Agentm]

speeding ticket for txn

this from the directors today in the reply

The Lennox well referred to in the Company’s release of 13 September 2010 has reached its target depth and electric logs will now be run. These logs will determine whether the well contains commercially producible oil or gas.


The initiation of drilling of the Company’s first Eagle Ford well was announced on 23 September 2010. This well is currently at a depth of 7,500 feet and has not yet reached its objective which will be at a vertical depth of about 10,500 feet. It is possible that the well will reach the Eagle Ford target in the next 7-10 days

 

[Agentm]

as posted by another poster on another forum.. this chart demonstrates (apparently) there is still some further upside to come

my personal view is that any success in the EFS shale well that is drilling atm will give the share some significant upside as the EFS valuation comes into play

 

[kash]

Agent
EFS shale well should be hitting depth in next couple of days. How long to get results?? Looking forward to this, should create some interest.

 

[Agentm]

the well would be drilling the horizontal atm..

the speculation money will start to impact on the txn share in the next few weeks.. there are signs of a lot of early starters getting in atm.. i would expect a flurry of buying as txn announces the successful completion of the well..

someone posted a little of the recent patterson report on another site

Scott Simpson an analyst @ Patersons Securities released a 12 page piece of research on TXN.

Using NPV methodology he's given a value of $0.98/share but includes a comment about their unrisked value >$3.

Nice to see a broker other than RBS supporting it! here's the first page unedited:

Investment Highlights

We are initiating coverage on TXN with a BUY recommendation and a price target of $0.98/sh. TXN is underpinned by proven production and reserves from the Olmos reservoir at its Leighton project area, with substantial upside to be realised from appraisal of 4,516 net acres of Eagle Ford shale (EFS) and further appraisal of Olmos reservoir across its Mosman/Rockingham project area. TXN is currently drilling its first EFS appraisal well, located in the oily window of the shale some 200m from Swift energy??s recent well - which flowed with an IP of 775bopd and 1.1mmscf/d (958boepd).

Underpinned by a proven and productive Olmos reservoir at Leighton. TXN has completed 7 wells on its Leighton area with an average IP of 423boepd and net 2P reserves of 2mmboe. The Olmos reservoir is located above the EFS at ~9,000ft and is produced via vertical wells at a cost of ~US$1m per well. There are some 35 possible well locations in its acreage at 40-acre spacing. One Olmos well has been drilled in the Mosman/Rockingham area, achieving a lower IP of 110boepd. Hence further appraisal is required to de-risk the reservoir and 51 possible well locations.

First Eagle Ford well to test substantial upside. Drilling of the Tyler Ranch EFS #1H is currently underway (82% WI) with a second well planned for Mosman/Rockingham in late 2010 (100% WI). TXN stands to benefit substantially from the successful appraisal of the EFS across its net 4,516 acres. We currently value its EFS assets at $0.49/sh on a risked full-field development basis, with unrisked value of +$2/sh. Subsequent drilling will provide key information on IP rates and production performance and de-risk the asset.


Successful appraisal of acreage to realise substantial upside. Subject to successful appraisal of the Olmos and Eagle Ford shale across TXN??s entire acreage, our analysis highlights total unrisked value of +$3/sh. The company is well funded to pursue an active drilling program commencing in late 2010 with its second EFS well and another in Q2 2011, 6 Olmos wells plus the drilling of 3 x additional prospects outside this core area over 2011.

 

[Synergy]

I expect to see some significant movement early this week with 60c forming new support. Time will tell...

 

[kash]

This hopeful stir that action.
FIRST EAGLE FORD HORIZONTAL WELL
GOOD OIL AND GAS SHOWS

Texon Petroleum Ltd (“Texon”) advises that the Tyler Ranch EFS #1H well has drilled into the Eagle
Ford Shale at the depth of 3,252m (10,670ft) and has encountered good oil and gas shows.

The well will now drill 1,372m (4,500ft) laterally within the Eagle Ford at which time production casing
will be run. Drilling and casing the well are anticipated to take 12-14 days.

Hydraulic fracture stimulation and testing of the well are scheduled for early November.

 

[Agentm]

This hopeful stir that action.
FIRST EAGLE FORD HORIZONTAL WELL
GOOD OIL AND GAS SHOWS

Texon Petroleum Ltd (“Texon”) advises that the Tyler Ranch EFS #1H well has drilled into the Eagle
Ford Shale at the depth of 3,252m (10,670ft) and has encountered good oil and gas shows.

The well will now drill 1,372m (4,500ft) laterally within the Eagle Ford at which time production casing
will be run. Drilling and casing the well are anticipated to take 12-14 days.

Hydraulic fracture stimulation and testing of the well are scheduled for early November.

i think your right on that front..

the news is very welcome


there are 2 ways you can report a well, one can be cut and dry, no trimmings, and another is to let the market know with a few words that your liking what your seeing.. and imho these guys are liking what they're seeing in the EFS


Texon Petroleum Ltd (“Texon”) advises that the Tyler Ranch EFS #1H well has drilled into the Eagle Ford Shale at the depth of 3,252m (10,670ft) and has encountered good oil and gas shows.


good luck to all holders

 

[Kremmen]

Texon Petroleum Ltd (“Texon”) advises that the Tyler Ranch EFS #1H well has drilled into the Eagle Ford Shale at the depth of 3,252m (10,670ft) and has encountered good oil and gas shows.

Sounds good. Having read about the increasing lack of crews and rigs in the area, I wonder if you know if Texon own/operate their own drilling equipment in Eagle Ford?

 

[Agentm]

Sounds good. Having read about the increasing lack of crews and rigs in the area, I wonder if you know if Texon own/operate their own drilling equipment in Eagle Ford?

on another site the information given was that nabors will be drilling the EFS well and then halliburton will be doing the frac.

the frac is announced as early Nov..

TXN have it in mind to commence a second well in this quarter, imho it would commence post the frac of the tyler ranch 1H well

 

[bazollie]

on another site the information given was that nabors will be drilling the EFS well and then halliburton will be doing the frac.

the frac is announced as early Nov..

TXN have it in mind to commence a second well in this quarter, imho it would commence post the frac of the tyler ranch 1H well

I read in a previous announcement from TXN that after this well is drilled, the drilling crew have 1 well to drill for another operator. After this well is completed, they will be back to drill the second well, & I am assuming that it will be in late November / early December.
Either way , with luck we should hopefully see 2 wells drilled and fracced by year end, and with more and more expertise gathering of the fraccing and completions we are hoping for some positive results in a timely manner.

Good luck to all holders, holding TXN for some results and more!

Regards
Bazollie

 

[Agentm]

15 October 2010

SECOND EAGLE FORD HORIZONTAL WELL COMMENCING LATE OCTOBER

Texon advises that it has contracted a rig for its second Eagle Ford horizontal well, Mosman-Rockingham EFS #1H (MR EFS #1H), which will be drilled on its Mosman/Rockingham leases.

The well is expected to begin drilling by the end of October and take 30 days to drill. The Eagle Ford is 140’ thick with good oil and gas shows in nearby vertical wells such as Texon’s Mosman/Rockingham #1 drilled in March 2010 (see Texon’s announcement of 6 April 2010).

MR EFS #1H is located in the northern part of the Mosman/Rockingham leases, some 4.2 km south of a Swift Eagle Ford well which flowed at an initial rate of 860 boepd (gas converted at 12/1) and 8.8 km north of another Swift Eagle Ford well which flowed at an initial rate of 1,200 boepd (gas converted at 12/1) – refer to attached map.

The Mosman/Rockingham leases cover 3,273 acres and Texon has an overall 96.6% Working Interest (72.4% NRI) in this area. Texon’s holding in the MR EFS #1H is 100% Working Interest (75% NRI).

Several other Eagle Ford wells are planned by other operators (Swift, XTO, Enduring) in the vicinity of Texon’s Leighton / Mosman / Rockingham leases and these are also shown on the map.

Please refer to Texon’s website for announcements by the Company: www.texonpetroleum.com.au
Oil and gas futures prices (Source: NYMEX November 2010 contracts)
Oil: US$82.73/bbl
Gas: US$3.65/mmbtu (approx. US$4.80/mcf for all Texon gas – including US$5.80/mcf for Leighton Olmos gas)

 

[Mofra]

60c ST support broken on TXN, will be interesting to watch how the market unfolds from here. May not be too much action until the end of November until progress is reported on the second EF well.

 

[Agentm]

25 October 2010

FIRST EAGLE FORD WELL
TESTING – MID NOVEMBER

Texon advises that it has finished drilling its first Eagle Ford well (TR EFS #1H). Strong oil and gas shows were observed throughout drilling 4,500ft horizontally within the Eagle Ford reservoir. Production casing has been run in preparation for the fracture stimulation which has been contracted and is expected to begin in the second week of November. After this work has been completed, the well will be production tested with results anticipated in the second half of November.

Texon has a 82% Working Interest


all systems go really

a nice completion without complications. 4500 feet of well ready for testing
and with strong gas and oil shows as well

as good as it gets i think

 

[bazollie]

Very interesting 4 weeks coming up for TXN. Horizontal completed with strong shows along the way. Frac coming up soon as well. This well is situated in a very prospective area and if the results are favourable will give TXN a very good idea of when, how many and where the next round of wells will be commenced.

All good times ahead IMHO
Regards
Bazollie

 

[Mofra]

Nabucca gas flow ann this morning - is 442 mcfgpb a little low?

At US$4.80 mcf for Texon gas, that's US$2,121.60 or US$689.52 per day for Texon's share. I now hold a small parcel of TXN but this sounds disappointing.

 

[Agentm]

the real story on the txn share is its drive upwards as it achieves new value for the EFS, something it has yet to achieve to any degree

drilling for oil is about turning a discovery into a profit. and managing that with minimal share dilution.

where txn is particularly lucky is that it has these producing wells, giving it positive cashflow, now it can look at the efs seriously, drill two wells and with that the share should in all liklihood achieve some of that efs value

my view is that the roadshow txn took last week in boston and NY, will attract some US based interest also, so lets see if the good news continues

imho money for txn will start to flow in the coming few weeks ahead,,,

you may see some sp re-ratings in the near term

good luck to all holders