Talon Petroleum Ltd

The Strike scheme was implemented: all Talon shares passed to a Strike subsidiary and 0.4828 Strike shares per Talon share were issued to eligible holders. Talon's four directors resigned and three new ones were appointed; delisting is expected 28 December. This ends the Strike takeover.

business combination

Talon lodged the court orders with ASIC, making the Strike scheme legally effective. Talon shares are suspended after trading on 14 December; holders on the 18 December record date get 0.4828 Strike shares each, with implementation expected 27 December.

business combination

The Federal Court approved the Strike scheme, under which Strike acquires all Talon shares for 0.4828 new Strike shares each. Talon expects to lodge the orders on 14 December, last trading that day, and implementation on 27 December 2023.

other

TMK said it completed the purchase of Talon's 33% interest in Gurvantes XXXV, issuing Talon 1.092bn shares and 546m options. Talon paid A$600,000 cash, and the securities were slightly fewer than the up to 1.1bn shares and 550m options in the October agreement.

asset acquisition disposition

Talon completes the Gurvantes sale to TMK, receiving 1.092bn TMK shares and 546m options and paying A$600,000. About 1.001bn shares and 500.5m options go to Talon holders by 22 December (about A$0.016 per Talon share); the rest is retained. This resolves the October deal.

asset acquisition disposition

Talon shareholders approved the Strike scheme, with 94.89% of votes cast in favour. Court approval is set for 13 December, with last Talon trading 14 December and implementation expected about 27 December 2023. Remaining conditions still apply.

other

The Strike scheme booklet is registered with ASIC. The independent expert, BDO Corporate Finance, concludes the scheme is fair and reasonable and in shareholders' best interests, absent a superior proposal. Directors unanimously recommend a vote in favour at the 7 December meeting.

other

Talon agrees to give its 33% Gurvantes interest to TMK for up to 1.1bn TMK shares and 550m options, mostly distributed to Talon holders (about A$0.02 per share). Talon also commits up to A$850,000 cash. This replaces the spin-out idea; vote expected late November.

asset acquisition disposition

TMK reports a 45 m thick gassy coal seam at the eastern Terra area, 100 km from the pilot wells, and expands the program by four more wells. Pilot wells continue producing gas continuously; Lucky Fox-3 needed pump cleanouts. Talon holds 33%.

drilling result

Strike reports firm Walyering sales began 1 October at a stable 20 TJ/d, condensate ~200 bbl/d. Final gross cost was A$30m, above forecast, and Strike expects payback in about two quarters. Strike gave Talon a comfort letter to increase its loan if needed.

production update

Operator Strike reports Walyering began exporting commissioning gas into the Parmelia pipeline on 25 September, with firm Santos sales due early October. Talon holds 45%. This is the field's first production, following the 2021 Walyering-5 discovery.

production update

Strike declares 0.4828 shares its best and final offer, absent a superior proposal. If the scheme fails, Strike will call the drawn convertible funds; if unpaid within 60 days it may enforce security over Talon's Walyering interest. Timetable: effective and delisting early to 20 December 2023.

business combination

Talon confirms the binding Strike scheme: 0.4828 Strike shares per Talon share, implied A$0.212, 21.4% above the last close. Board unanimously recommends it, absent a superior proposal. Talon will explore spinning out its 33% Gurvantes stake, with A$850,000 cash; no certainty. Scheme booklet expected November 2023.

business combination

Strike signs a binding deal to acquire Talon by scheme: 0.4828 Strike shares per Talon share, implied A$0.212, a ~21% premium to the 11 Aug close. Revives the proposal Strike withdrew on 1 Aug. Mongolian spin-out possible; Strike provides up to A$6m convertible funding; Talon holders get ~11%.

business combination

TMK reports sustained gas flow from all three Gurvantes pilot wells, enough to support continuous flares, with water at over 600 barrels a day combined. Initial flow rates are expected in several weeks. TMK says this is proof of concept; commerciality is still to be assessed.

flow test result

Strike says it ceased talks on acquiring Talon, which had been at 0.4828 Strike shares per Talon share plus retained Mongolian assets and a up to $6m funding facility. After due diligence and finance facility negotiation, the parties could not agree terms.

business combination

Talon says Strike's revised proposal, 0.4828 Strike shares per Talon share (implied $0.21, 20% premium) plus Mongolian assets and a up to $6m convertible facility, was withdrawn when the parties could not agree terms by 1 August. Talon was willing to keep negotiating.

business combination

Talon's shares are suspended from quotation at its own request from 31 July, pending an announcement about a proposed material transaction. Expected to last until 1 August at most or until the announcement.

other

TMK flared gas from Lucky Fox-1 for about three hours, the first gas to surface at Gurvantes. The flow was unsustained, so it does not indicate sustained rates. The three wells produce about 500 barrels of water a day combined.

flow test result

Talon discloses an unsolicited, non-binding Strike proposal received 19 July: a scheme at 0.4586 Strike shares per Talon share, plus Talon's Mongolian assets demerged to shareholders. Strike withdrew it on 23 July after Talon sought time to evaluate. No action needed.

business combination

Talon reports all three Gurvantes pilot wells finished safely, on time and on budget, each with at least 60 m of gassy coal. Pumps and facilities go in during June, and first gas is conservatively expected one to two months after pumping starts. Gas rates are still untested.

drilling result

Talon (45%) confirms a condensate processing and sales deal with Santos, a route to market for Walyering liquids beyond the December gas sales deal. The JV expects over A$10M a year gross revenue at US$75 Brent. The Safety Case is now accepted; start-up is still targeted for 1H 2023.

material agreement

Greg Columbus, formerly chair of Warrego Energy, becomes independent non-executive chairman from 3 April 2023. Doug Jendry will resign from the board at the May AGM after a handover. Jendry says market cap rose from A$9M to about A$90M since late 2020.

director officer appointment

Talon reports preliminary L7 prospective resources for three gas prospects, each over 50 Bcf best case; Booth is 279 Bcf gross (69.8 Bcf net to Talon's 25%). Two best prospects are targeted for drilling in 2024, possibly early 2024. This updates the earlier 617 Bcf Triangle estimate for L7.

resource reserve update

Operator Triangle's interpretation of the Bookara 3D seismic high-grades four 2024 drilling candidates: three gas prospects in L7 (best case 393 Bcf gross, unrisked prospective) and the Becos oil prospect in EP437 (5 MMbbl). This follows Talon's March farm-in for 25%.

resource reserve update

Talon raises A$12M via a placement at A$0.145 (82.8m shares), plus an SPP of up to A$2M at the same price. It chose equity despite credit-approved debt terms. It also starts a strategic review of its 33% Gurvantes interest, possibly including a demerger.

capital raising announcement

Talon signs the formal farm-in for 25% of L7 and EP437 after due diligence. It pays A$1M now and about A$0.9M before 1 September 2023, plus about A$7.3M net toward three 2024 wells. Prior Triangle work shows 617 Bcf best-case prospective resource (gross, unrisked) in L7 alone.

farm in farm out completion

Operator TMK signs Major Drilling to drill the three Gurvantes pilot wells, starting April, about eight weeks. Pilot cost is about US$3.5M, of which Talon pays the first US$3.15M (stage 2 funding), then 33% of the balance. Pilot wells would then run about six months.

drilling scheduled

The WA regulator grants Production Licence L23 for Walyering (Talon 45%), a key approval on schedule. Procurement is about 98% complete and fabrication 65%; startup is targeted by end of Q1 2023, with the workover rig due mid-February.

regulatory community update

Talon signs a binding term sheet to farm into 25% of Triangle's L7 and EP 437 northern Perth Basin permits, subject to due diligence. It pays about A$1.9M for seismic costs and funds shares of three 2024 wells, after Walyering first gas.

farm in farm out agreement

Talon announces the Walyering gas sales agreement with Santos: at least 36.5 PJ over 5 years, partly take-or-pay, US dollar priced and linked to US CPI, delivery from Q1 2023. This resolves the open gas sales term sheet from October.

material agreement

Talon has firm commitments for a A$12M placement of about 85.7M shares at A$0.14, a 9.7% discount to the last close. Proceeds fund the Gurvantes stage 2 commitment (~US$3.15M plus US$809,333 resource payment) and Walyering costs; debt talks continue.

capital raising announcement

Talon exercises its option and takes a 33% interest in the Gurvantes XXXV coal seam gas project, with about 400 BCF of the 1.2 TCF 2C resource now attributable to it. It also holds a first right of refusal over TMK's remaining 67%.

farm in farm out completion

TMK reports NSAI's maiden Gurvantes contingent resource: 1,214 BCF best estimate (2C), 398 BCF low and 2,361 BCF high. All 1C and 2C is in the upper seam; the lower seam has only 3C. Pilot wells are planned from Q1 2023. Talon is still earning 33%.

resource reserve update

Talon announces the NSAI-certified Gurvantes maiden contingent resource of about 1.2 TCF (2C) following the stage 1 program, funded by Talon at about US$1.5M. Talon holds an option on a 33% interest and says it is better placed to decide on continuing.

resource reserve update

Talon and Strike approved development of Walyering (final investment decision), after the 54.2 PJ 2P reserve. Cost is $14.4M gross ($6.5M Talon at 45%), first gas targeted Q1 2023, and contracts expected Q4 2022. Talon has hired BurnVoir to arrange debt funding.

material agreement

TMK, owner of Gurvantes, signed a non-exclusive MOU with PetroChina subsidiary DATAMO to speed up development, which may lead to an investment in the project or in TMK. Talon, still earning 33%, has 3 of the minimum 4 core holes completed.

joint venture update

Talon books its maiden reserve at Walyering: RISC certifies gross 2P reserves of 54.2 PJ (Talon's 45%: 24.4 PJ), plus 31.9 PJ gross 2C contingent resource. This delivers the reserve aim and underpins a final investment decision.

resource reserve update

Strike reports the Walyering-6 Cadda gas discovery flowed at a maximum 35 mmscfd, stabilising at 30 mmscfd. The Cattamarra C and D Sands contribute gas, but the B Sand produces water and is excluded from initial production. The well will be completed for production later in 2022.

flow test result

Shareholders approved the 20-for-1 consolidation at the 18 July meeting, effective 19 July 2022. This resolves the proposal announced in June. TPD says it does not change underlying value.

security holder rights change

Talon will ask shareholders at a 18 July 2022 meeting to approve a 20-for-1 consolidation of its shares, options and performance rights. TPD says this does not change underlying value; the share price should rise about 20 times.

security holder rights change

TMK reports a flow capacity of 1,090 mD.m over the 70m upper coal seam at Snow Leopard-2, which it calls high permeability. This eases the earlier Snow Leopard-1 testing difficulty (~4.1 mD.m). TMK is fast-tracking pilot production planning, the stage 2 Talon may fund.

well test result

TMK reports Snow Leopard-2 hit about 70m of gassy coal from 167m, with high preliminary gas contents. Final Snow Leopard-1 gas contents averaged 13.2 m3/t, above the earlier 7.5-12.5 range, though permeability testing was troubled (about 4.1 mD.m).

drilling result

Talon says Walyering-6 hit a new 4m net gas pay in the Cadda Formation and about 21m net pay in the B and C Sands, though the A Sand showed low gas saturation. Drilling is complete; flow testing is expected in June, informing the final investment decision.

drilling result

Strike reports Walyering-5 testing finished after 21 days: the A-Sand flowed 59 mmscfd peak, and the commingled flow peaked at 75 mmscfd (67 stabilised), limited by equipment. Strike is studying lifting plant capacity to 35 mmscfd. This resolves the earlier equipment-limited tests, far exceeding the first 7 mmscf/d.

flow test result

Talon raises A$11m via placement of 1.375bn shares at A$0.008, a 20% discount to the last price, plus a A$4m share purchase plan. Proceeds fund its share of Walyering development and Mongolia work. CEO Hauser plans to invest A$150,000, subject to approval.

capital raising announcement

Strike reports individual Walyering-5 tests: B-Sand peaked at 33 mmscfd, C-Sand 32 mmscfd (27 stabilised), D-Sand 13 mmscfd, with clean gas. Walyering-6 has begun drilling, at 969m. Builds on the earlier 7 mmscf/d D-Sand flare result.

flow test result

Finder Energy will acquire 100% of Talon's UK licence P2527 (White Bear), conditional on approvals. Talon pays nothing and receives no upfront cash, but gets 12.5% of Finder's gross income from the licence, converting to a 3% production royalty. This advances Talon's UK exit.

asset acquisition disposition

TMK reports Snow Leopard-1 intersected 44m of gassy coal at 406-461m, with preliminary gas content of 7.5-12.5 m3/t and high saturation. Talon is funding the program under the US$4.65m farm-in; a maiden contingent resource is targeted in 2H 2022.

drilling result

Operator TMK reports the first of four Gurvantes coreholes, Snow Leopard 01, spudded 15 March 2022, targeting about 650m over four weeks. Talon funds the program to earn 33%; the other three holes follow over 3-4 months, a first step to converting the 5.96 TCF prospective resource.

drilling spud

Talon is exiting its UK North Sea exploration portfolio to focus on more advanced projects, relinquishing licences. It is discussing a possible sale of P2727 (White Bear). NED Steve Jenkins steps down in February, and consultants Dorè and Young finish. This ends the UK strategy begun in 2019.

asset acquisition disposition

David Casey became a Non-executive Director on 1 January 2022, retaining a Mongolia focus. His performance rights were cut to 160m from 327.7m, with 40m options at A$0.01 proposed subject to shareholder approval. Talon has begun a search for a new CEO.

director officer appointment

Strike reports Walyering-5 confirmed four gas-charged sands with 51m net pay, results exceeding its pre-drill expectations; CO2 under 1%. The A Sand sits higher than Walyering-1, suggesting a larger gas column. A production test is planned Q1 2022. Positive for Talon's 45%.

drilling result

Walyering-5 reached 3,435m, 8 days ahead of schedule. Strike saw elevated gas and good sands in the A and B targets plus deeper sands. Logging is under way, so the significance is not yet confirmed.

drilling result

Managing Director David Casey will move to Executive Director by the New Year to take a new role outside the company, staying on the Board and working on Mongolia. Matt Worner continues as Executive Director. No replacement MD is named in the text.

director officer appointment

Strike spudded the Walyering-5 appraisal well at 16:15 on 14 November 2021 using Ensign Rig 970, and was drilling ahead at 483m. It plans to drill to about 1,010m before running casing; Talon holds 45% of the joint venture.

drilling spud

The Rocket (P2392) and Skymoos (P2363) UK North Sea licences expired after extension applications failed, and no farm-out was signed in time. Talon blames COVID delays. This ends the Skymoos/Rocket extension and farm-out threads; other UK licences remain under review.

asset acquisition disposition

Mongolia granted the Gurvantes XXXV Exploration Licence on 9 September 2021, for 10 years with a possible 5-year extension. Talon says it is ahead of expectations; the environmental study is still to finish, with drilling expected next quarter and a maiden contingent resource early 2022.

regulatory community update

Independent assessor NSAI booked a maiden Gurvantes XXXV prospective resource: risked best case 5.96 TCF (unrisked 19.96 TCF) over 2,235 km² of the 8,400 km² area. Talon's 33% share would be 1.97 TCF risked, if the farm-in completes. Still undrilled.

resource reserve update

Talon takes 60% of GreenFlame Energy, which holds a licence for a patented superheated steam technology to boost coal seam gas recovery while storing CO2. GreenFlame has a conditional deal to buy Strike's 67% of PEL96 (Cooper Basin). Initial work is to be funded from existing cash; field activity is targeted for early 2022.

asset acquisition disposition

The Gurvantes XXXV PSA was awarded to Telmen at a signing ceremony in Ulaanbaatar on 27 July 2021, resolving the pending award. Talon and Telmen now move to finalise operating agreements, a resource certification and this year's exploration program.

regulatory community update

Mongolia's Cabinet approved the Gurvantes XXXV coal bed methane PSA on 7 July, after COVID delays; formal issue is expected within weeks. To extend Telmen's exclusivity, Talon will issue 100m options at A$0.01, expiring in 3 years. Farm-in agreements are still being prepared.

regulatory community update

Talon booked a maiden best-estimate (P50) prospective resource of 408 Bcf gas and 20.2 MMbbl condensate at Condor (formerly Muchea), with a high case of 710 Bcf. Chance of success is a low 15%. The formal Macallum agreement has now been signed, replacing the January term sheet.

resource reserve update

Talon gets a binding offer to farm into 33% of the Gurvantes XXXV coal bed methane licence in Mongolia, a new country for the company. It raises A$5m at A$0.004 (about 1.25bn shares; A$1m tranche needs shareholder approval). Licence award is still pending.

capital raising announcement

Talon signed a non-binding term sheet to acquire 100% of the Muchea Structure (EP494, SPA-0081) in the Perth Basin from Macallum, a second Perth Basin asset after Walyering. Terms: A$90k now, 54m shares on formal agreements, then A$350k of shares plus a 1.95% royalty if it proceeds; A$100k fee if not.

asset acquisition disposition

Talon has been awarded three new UK Central North Sea exploration licences from the 32nd round, taking it to eight UK licences. It says work commitments are very low and that potential partners have already enquired. This confirms the September offers.

regulatory community update

Doug Jendry becomes Non-Executive Chairman, replacing Peter Stickland, who resigns. Graham Doré steps back from the board to lead the UK technical team. Jendry advises the Nero Resource Fund, a significant Talon shareholder, and was involved in the 2001 Walyering-4 dry hole.

director officer appointment

Strike has contracted Ensign Rig 970 to drill the Walyering-5 appraisal well straight after its West Erregulla campaign. Drilling is likely to start in mid-2021. This firms up the timing of the well Talon is funding.

drilling scheduled

Formal agreements with Strike for the 45% Walyering (EP447) farm-in are signed, replacing the July non-binding term sheet. Completion still needs standard regulatory approval. The well is to follow Strike's West Erregulla campaign.

farm in farm out agreement

Talon has been offered three licence areas in the UK 32nd Offshore Licensing Round, per the OGA website. Official confirmation has not yet arrived. Talon says the areas have low-cost work commitments. This resolves the pending 32nd round results.

regulatory community update

Talon has firm commitments for a A$5m placement of about 2.5bn shares at A$0.002, a 33% premium to the 20-day VWAP, with 1-for-2 free options at A$0.004. A$0.89m comes in the first tranche. The rest needs shareholder approval and would lift cash to about A$6.4m. It funds the Walyering farm-in.

capital raising announcement

Talon signed a non-binding term sheet to farm into 45% of Strike's EP447 (Walyering, Perth Basin) by contributing A$6m to a A$9m well planned for 2021. David Casey becomes Managing Director, and Matt Worner stays as an executive director. This marks a new focus beyond the North Sea.

farm in farm out agreement

Strike Energy says Talon will earn 45% of the Walyering permit (EP447) in the onshore Perth Basin by funding the first A$6m of a A$9m well. Talon also pays A$1m as security. This is the partner's side of Talon's new Perth Basin entry, and it is subject to final documents and ministerial approval.

farm in farm out agreement

Curlew-A gross 2C contingent resource was cut from 45 to 39 mmboe (3.9 mmboe net to Talon) because of a gas calculation error in the original report. Recoverable oil is unchanged at 36.2 mmbbl. Site survey began; drilling is now eyed for H1 2020.

resource reserve update

Talon and ONE-Dyas won a licence over Block 14/30b, holding the Thelma (29 mmbo), Louise (17 mmbo) and Buffalo (160 Bcf) prospects next to Talon's Skymoos. Two-year work commitments are about A$30,000 gross. It is Talon's fifth North Sea asset.

asset acquisition disposition

Talon was offered a 50% interest in a licence over Blocks 12/26a and 12/27a, containing the 44 mmbo Vantage prospect, from the UK 31st round. Its share of initial two-year costs is about A$60,000. It is Talon's fourth North Sea asset.

asset acquisition disposition

Shareholders approved the EnCounter acquisition at the 12 March 2019 general meeting, so it proceeds. Peter Love retired and Peter Stickland became Chairman. This completes the approval step announced on 31 January; Curlew-A appraisal is still due in Q3.

director officer appointment

Talon agreed to buy EnCounter Oil, adding 100% of the Skymoos (107 mmbo) and Rocket (27 mmbo) prospects, for 100m shares plus 400m performance shares tied to farm-outs. It also raises A$1.25m in a placement. Chairman Love will retire; Graham Doré joins the board.

business combination

Talon agreed to earn a 10% interest in UK North Sea Licence P2396 from Corallian, containing the Curlew-A discovery (45 mmboe gross 2C contingent resource). Appraisal well planned 3Q 2019; net cost about A$3.2m at cap. It also placed 240m shares at A$0.003 to raise A$720k.

farm in farm out agreement

Talon says a Gambian ministry website notice lists it as shortlisted for the next stage of a six-block licensing round, alongside CNOOC, Total, Woodside and others. It is a competitive bid with no guarantee of an award. This is the first concrete step in the post-raising new-asset search.

regulatory community update

December 2017 quarter net production was 447 boe, down slightly from 484. The placement closed 22 December at A$2.3m (766.7m shares at A$0.003), above the A$1.9m proposed, and funds the A$300k loan repayment and a review of MR Olmos. Lease dispute unchanged; Quintanilla acreage termination is contested.

quarterly activities report

Following the shareholder meeting, Roger Steinepreis and Matthew Worner joined the board, and Peter Evans resigned as planned. This completes the board restructure flagged with the October capital raising. Both new directors hold no shares per their notices.

director officer appointment

Talon plans to raise up to A$1.9m by placing up to 633m shares at A$0.003, plus 90m options at A$0.005, with director Troy Harry taking A$300,000. Funds retire his A$300,000 debt and review MR Olmos. Subject to shareholder approval; Evans exits and Worner and Steinepreis join the board.

capital raising announcement

ASX suspended Talon's shares after it failed to lodge half-year accounts for the period to 30 June 2017 on time.

listing compliance notice

June 2017 quarter net production was 706 boe, up from 434. The lessor dispute continues, and Talon has delayed the PLS Inc sale launch until it can give buyers clearer advice on lease status. Quarterly cash figure not shown in the text provided.

quarterly activities report

A lessor has written disputing Talon's leasehold position on specific MR Olmos leases. Lawyers cannot yet say whether the roughly 3,620 net acres are affected. This puts at risk the sole asset the board has been trying to sell.

regulatory community update

Sale of the ELGU #1/Coolangatta and Scherer #2/Angourie interests completed, with all of the agreed US$630,000 received. This resolves the sale first announced in September 2015 and leaves MR Olmos as the remaining asset.

asset acquisition disposition

September quarter net production was 1,508 boe. The Coolangatta/Scherer #2 sale for US$630,000 is now under contract, closing expected 10 November. A formal MR Olmos sale process drew numerous bids, but the board rejected all as materially undervaluing the asset. Roundhouse and related leases expired.

quarterly activities report

Talon signed a letter of intent to sell its ELGU #1 and remaining Coolangatta interest plus its Scherer #2 (Angourie) interest. A non-binding offer of US$630,000 was received, with a 60-day closing targeted. Not yet binding.

asset acquisition disposition

Managing Director and CEO Clifford Foss retires, having led Talon since its February 2013 listing. Company Secretary Andrew Crawford joins the board as non-executive director. Completes the transition announced in February.

director officer appointment

Entitlement offer drew applications for 41.88m of 45.84m new shares (91.37%). Applications are capped and scaled back, and the underwriter takes the shortfall. Completes the roughly A$500,000 raise at A$0.012 announced 30 March.

capital raising announcement

Talon launches a fully underwritten 2-for-9 entitlement offer at A$0.012 to raise about A$500,000 after costs, about 46m new shares, for working capital. Trojan Investment Management underwrites it. A small-lot share sale facility is announced alongside.

capital raising announcement

Chairman's letter: staff cut, managing director Foss moves to a transitional role until August 2015, overheads to fall under A$600k a year. The Wandoo agreement is ended for US$100k plus the Dunsborough and Sunshine prospects. Offers for assets were received but declined; a small-lot buy-back is planned.

other

Quintanilla OL 1H made 33,945 boe in its first 90 days; current rate 443 boepd. Talon says Aschere did not validly exercise its option, so Talon retains 100% of the ~3,600 acres. This contradicts the 12 January statement that Aschere would take 16.66%.

production update

Terrace did not exercise its option over the ~3,600 MR Olmos acres, while Aschere is to take 16.66% for about US$350,000. Talon keeps 83.33%, not the 50% sell-down expected earlier. Acreage is mostly held by production, so drilling timing is in Talon's control.

farm in farm out completion

The Coolangatta test well reached 10,450 ft and logs show 54 ft of gas condensate reservoir. Talon elected to join completion for about US$47,000 to keep its 6.25% interest. Flow testing is expected in coming weeks; management says the discovery may be material.

drilling result

Texas regulators amended the AWP Olmos field rules to allow 80-acre spacing, resolving the pending ruling. Talon raises MR Olmos drilling locations 64% to 41. Quintanilla is making 458 boepd after 73 days. Partners are expected to take up options in mid-January.

regulatory community update

Talon sold down its 25% Coolangatta interest so it pays nothing to drill the first test well through logging, receiving US$37,500. It keeps 6.25% if the well is productive, at about US$45,000 completion cost. Spud planned mid-December 2014.

farm in farm out agreement

Board restructured: Forbes, Douglas and Cowley, who joined at the Texon demerger, retired. Peter Love becomes chairman and Peter Evans, a former Morgans stockbroker, joins. CEO Foss stays. Love plans to cut overheads further. Board shrinks to three.

director officer appointment

Quintanilla OL 1H, the first horizontal Olmos well, tested a peak 986 boepd (744 bopd, 1,452 mcfd) over 2 hours; the prior 24-hour rate was about 886 boepd. Talon holds 10%. This proves the MR Olmos concept; second-well planning begins.

well test result

The A$1.12m 1-for-1 entitlement offer at A$0.011 closed oversubscribed, with A$1.68m applied for. Entitlements were met in full, extra applications were scaled back, and 13.39m shortfall shares go to underwriter Morgans and sub-underwriters. Completes the raise launched 22 July.

capital raising announcement

Drilling started on Quintanilla OL 1H, the first horizontal well at MR Olmos, targeting 13,600 ft measured depth in about two weeks. Talon operates at 10% WI at a cost of about US$550,000. Fracing follows, and 1C resource potential is 235-327 mboe per well.

drilling spud

Talon launched a 1-for-1 fully underwritten entitlement offer at A$0.011 per share to raise up to A$1.12m, a 15.4% discount to the last close. Morgans underwrites it, with the chairman and two directors sub-underwriting. It follows cash falling to A$1.7m.

capital raising announcement

Talon settled Sundance's claims: US$300k of the roughly US$1.35m escrow goes to Sundance and about US$1.05m is released to Talon. Talon also assigns its Austin Chalk interest to Sundance and will help reallocate pre-demerger costs. This resolves the September 2013 dispute.

material agreement

Talon agreed a joint group with Terrace, Aschere and EFSE to drill the Quintanilla 1H Olmos well, with Talon operating at 10% of an estimated US$5.5m cost. Talon is paid about US$90k and keeps 50% of the surrounding acreage. Options could add about US$2m. Drilling is expected in the June 2014 quarter.

farm in farm out agreement

Bonner 1H, on a jet pump since November 2013, has lifted oil recovery from about 45 to 70 bopd, with about 60% of frac fluid recovered and 1,849 barrels of oil produced. These are early, preliminary results for the Roundhouse proof-of-concept well, in which Talon holds about 24%.

flow test result

Sundance Energy has given notice of claims under the Texon merger agreement and the demerger deed. US$1.5m is held in escrow for such liabilities. Talon is assessing the claims; the amount claimed is not stated.

material agreement

During fracing on 25 July the Bonner 1H casings parted and two contractors were injured. Well-control specialists are assessing; the impact on completing the well, in which Talon holds 24.25%, is not yet known. Insurers have been told.

drilling progress report

First Roundhouse horizontal well expected to start in early June, 5,500 ft lateral, Talon 25% for US$1.65m with O'Brien operating. This replaces the earlier 50% deal (about US$4m well cost). Holding rises to 7,380 acres; management suggests 10-15m barrels potential if successful.

farm in farm out agreement

Chairman John Armstrong will retire after the 30 May AGM. Jeff Forbes becomes chairman and Bruce Cowley, a Minter Ellison partner and former Texon legal adviser, joins as director, completing the board renewal.

director officer appointment

Clifford Foss was appointed President, CEO and Managing Director of Talon. His contract is three years at US$360,000 a year, with bonuses and options tied to share price. He says the aim is to build and sell assets. Texon merged into Sundance on 8 March 2013.

director officer appointment

Texon's chairman outlined the demerger of Talon, which would hold Texon's non-Eagle Ford assets. Texon holders get 2 Talon shares per 5 Texon shares. The Sundance Energy takeover of Texon depends on the demerger passing. Talon starts with production from only two wells.

business combination