Texon Petroleum Limited (ASX:TXN) Iluka Well Spudded, Rig Then Moves to First Wilcox Oil Test

Brisbane, Aug 5, 2011 AEST (ABN Newswire) - Texon Petroleum Limited (ASX:TXN) advises that the Iluka well (Scherer #1) spudded on the 1st of August.

This is a small gas prospect where the Yegua reservoir is the target. Iluka is the last of Texon's three (3) shallow Yegua prospects to be drilled. Texon originally had a 100% WI but sold all three Yegua prospects on a promoted basis to a private USA based company. Wells on the prior two prospects were successful Yegua completions for gas production.

The cost to Texon's retained 32.5%WI is largely covered by the promoted USA based company.

Wilcox

Drilling of Iluka is expected to take 10 days, at which time the rig will move to drill Texon's first well where Wilcox oil reservoirs are the target. (Please refer to Texon's release of 7 April 2011).

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

- Oil: US$90.29/bbl
- Gas: US$4.07/mmbtu (this translates to approx. US$6.70/mcf for all Texon gas - including US$7.70/mcf for Olmos and Eagle Ford gas)

Contact

Dr. John Armstrong Chairman Email: john.armstrong@texonpetroleum.com.au Mr. David Mason Chief Executive Officer Email: dave.mason@texonpetroleum.com.au Tel: +61-7-3211-1122 http://www.texonpetroleum.com.au