Texon Petroleum Limited (ASX:TXN) Second Eagle Ford Well Observed Good Oil And Gas Shows

Brisbane, Dec 21, 2010 AEST (ABN Newswire) - Texon Petroleum Limited (ASX:TXN) advises that it has finished drilling and casing its second Eagle Ford well (Teal EFS #1H). Strong oil and gas shows were observed throughout the 4,500ft of horizontal drilling within the Eagle Ford reservoir similar to the oil and gas shows in the first Eagle Ford well that has just been tested. Production casing has been run in preparation for the fracture stimulation which has been contracted and is expected to begin in March. After this work has been completed, the well will be production tested.

Log analysis indicates that the reservoir characteristics (porosity, permeability and oil and gas content) in the Eagle Ford in this second well (Teal EFS #1H) are similar to the reservoir properties of the Eagle Ford in recently tested Tyler Ranch EFS #1H located 5 km to the Northeast and which flowed 1,200 bopd.

There are now three wells which have flowed substantial quantities of oil from the Eagle Ford in and around Texon's Leighton, Mosman, Rockingham and Sutton leases ("LMRS"). These wells are shown on the map (see link at the bottom of the release) i.e. Texon's first Eagle Ford well which flowed 1,200 bopd and two Swift wells which flowed respectively 1,134 bopd and 775 bopd. These results indicate that the Eagle Ford in Texon's LMRS leases is in a liquids rich area.

Texon has a 100% Working Interest (75% net revenue interest) in the Teal EFS #1H well.

Texon has an overall 92% Working Interest in approximately 5,000 gross acres in the LMRS leases which surround or are nearby to Texon's first Eagle Ford well. The Eagle Ford reservoir is expected to be present throughout these leases.

Texon's nett Eagle Ford acreage holding is 4,550 acres which could represent a resource potential of some 30-34 mmboe as to the Company's working interest or 23-26 mmboe as to Texon's net revenue interest in these leases.

Oil and gas futures prices (Source: NYMEX January 2011 contracts)

Oil: US$88.79/bbl

Gas: US$4.23/mmbtu (approx. US$4.90/mcf for all Texon gas - including US$6.80/mcf for LMRS, Eagle Ford and Olmos gas).

For the complete Texon announcement including map, please view the following link:

http://www.abnnewswire.net/media/en/docs/64859-ASX-TXN-227625.pdf

Contact

Dr. John Armstrong Chairman Brisbane: Tel: +61-7-3211-1122 Mr. David Mason Chief Executive Officer Brisbane: Tel: +61-7-3211-1122 Houston: Tel: +1-281-419-4976 (Houston is 16 hours behind Aust. Eastern Standard time)