Texon Petroleum Limited (ASX:TXN) Fifth Leighton Olmos Production Well Will Also Drill Eagle Ford Shale

Brisbane, Oct 12, 2009 AEST (ABN Newswire) - Texon Petroleum Limited (ASX:TXN) advises that the fifth Leighton well, Tyler Ranch #4, commenced drilling on 10 October 2009. The well has a planned total depth of 3,444 metres (11,300 feet) and will take about 20-25 days to drill. The well will penetrate the Olmos reservoir at approximately 2,703 metres (8,870 feet), which is the same oil and gas reservoir as is producing in the first four Leighton wells (Peeler #1, Tyler Ranch #1, Tyler Ranch #2 and Tyler Ranch #3). Tyler Ranch #4 is located 326 metres south west of Tyler Ranch #1.

In addition to targeting the Olmos reservoir, Tyler Ranch #4 will drill about 2,000 feet deeper to the Eagle Ford Shale which has flowed oil and gas from Petrohawk wells at rates of 3.8-8.3mmcfgpd and 200-395 bbl of condensate (oil) per day and which represents a significant upside opportunity for the Company in the Leighton area. Once drilled, the plan is to collect data on the Eagle Ford Shale to evaluate whether it could contain commercially producible oil and gas. In turn this will enable the Company to assess whether the Eagle Ford Shale has development potential over the 2,700 acres of leases that Texon holds at Leighton and Mosman. Refer also to the Company's announcement on 11 September which sets out the upside potential of the Eagle Ford Shale in these leases.

If the wire line electric logs indicate producible oil and gas in the Olmos reservoir the well will be completed as the Company's fifth oil and gas producer from this zone.

Texon has a 70% working interest (52.5% net revenue interest) in the Leighton Project with joint venture parties Global Petroleum Limited (15%) and Excellong, Inc (15%).

Oil and gas futures prices [Source: NYMEX November 2009 contract]

Oil: US$72.27/bblGas: US$4.79/mmbtu

    
      
        
          
            
            
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Dr John Armstrong
Chairman
Brisbane: +61-7-3211-1122

Mr David Mason
Chief Executive Officer
Brisbane: +61-7-3211-1122
Houston: +1-281-419-4976