Basker sidetrack a winner: Anzon

ANZON Australia may have the last laugh following its failed merger with Nexus Energy after producing more strong flows during testing of its Basker-6ST 1 well in the Basker oil field.
Basker sidetrack a winner: Anzon Basker sidetrack a winner: Anzon Basker sidetrack a winner: Anzon Basker sidetrack a winner: Anzon Basker sidetrack a winner: Anzon

The well flowed oil at a stable rate of 4800 barrels per day during its third and final production test over zones 2 and 7, adding to flow rates of more than 8000bpd from the shallower new pool discovery sand 2872m and the field-wide intra-Latrobe sand zone.

Anzon said the production rates are higher than the joint venture expected and support the existence of a significant southeastern extension to the Basker field with field-wide reservoir sands.

The results also back Anzon chief financial officer Tony Strasser's comments in yesterday's Australian that Nexus was offering too little for Anzon in its revised takeover offer.

Strasser claimed Nexus managing director Ian Tchacos had used his company's blocking stake in Anzon to try to force the acceptance of a lower value for the company.

"Our view is that at the very least, the latest drill results put us back to where we were before Basker-6 came in under expectations," he said.

Nexus had said on Monday the merger, which originally valued Anzon at about $1.71 per share, fell apart after both companies failed to agree that revised merger terms were necessary following the disappointing results from Basker-6 and what it maintains are unfavourable results from the Basker-6ST1 sidetrack.

Strasser told the Australian that the results showed Anzon was worth at least $1.50 a share.

"Anzon is not a $1.20 a share company," he said.

Anzon's original Basker-6 appraisal well had failed to find a southeast extension of the Basker field after intersecting its objectives about 40m low to prognosis and below the hydrocarbon-water contacts, leading to suggestions that reserves at the field might be downgraded by as much as 40%.

The subsequent sidetrack did encounter what appeared to be a southeast extension of the field, and the latest results have led some analysts to suggest that a reassessment of the geology at both Basker and Manta might actually upgrade reserves at the two fields.

Nexus managing director Ian Tchacos maintains that it does not believe this is the case.

"We couldn't get a meeting of minds on value," he told the newspaper.