potentially significant new oil play, page-13

Activity and interest is building in the Canning Basin. I would suggest a takover is possible, but let's hope a deal is done like what NSE have done(refer below announcement 13 July, 2011) or the market starts valuing this stock properly. BRU and NSE are kicking goals in the Canning Basin. NSE has gone from 20c since 13/7/11 to 36.5c like a bullet and still going up with a market cap of $80 million. BRU has a market cap of $133 million. OBL has a market cap of $9 million.

The 13 July announcement is
NSE AND CONOCOPHILLIPS EXECUTE HEADS OF AGREEMENT TO FARM INTO GOLDWYER PROJECT
(ASX: NSE)
New Standard Energy Ltd (New Standard) announces that it has entered into a non-binding Heads of Agreement (Heads of Agreement) and exclusive negotiating period with ConocoPhillips Australia SH4 Pty Ltd (ConocoPhillips), an affiliate of global energy company ConocoPhillips [NYSE:COP].
The Heads of Agreement sets the framework for ConocoPhillips to farm-in and jointly explore, New Standard?s flagship Goldwyer Project in the Canning Basin, Western Australia. It also contains an agreed set of core commercial principles which will form the basis for negotiating and completing binding and definitive agreements.
These core commercial principles envisage ConocoPhillips funding up to US$109.5MM over four phases of unconventional hydrocarbon exploration work, including the drilling, coring and evaluation of multiple wells. In return for funding the phased work program ConocoPhillips will have the right to earn up to a 75% working interest in the Goldwyer Project which would reduce New Standard?s working interest from 100% to 25%.
ConocoPhillips must complete all four phases of work to earn and retain the 75% working interest. In the event that ConocoPhillips elects not to complete all four proposed phases of work a 100% operated working interest in the Goldwyer Project will revert to New Standard.
ConocoPhillips will also make an upfront payment of A$1MM to New Standard in consideration of prior costs.
The phased nature of the exploration program provides for initial drilling, coring and evaluation of multiple wells to be undertaken following which ConocoPhillips will be required to decide if it wishes to proceed with further exploration, appraisal and pilot development work in subsequent phases. This structure provides ConocoPhillips with the option to withdraw at the completion of each phase of work on the basis that any working interest (or associated rights) is returned to New Standard.
The timing of the proposed work programs will be consistent with permit and work commitment revisions to be sought and agreed with the government. New Standard envisages that Phase 1 work would be carried out in 2012 assuming binding agreements are successfully executed.
The Heads of Agreement contemplates that New Standard will remain as operator, although ConocoPhillips would have the right to assume operatorship of the Goldwyer Project at its election. An integral part of the proposed farm-in arrangement is the proposed provision of technical support by ConocoPhillips to New Standard to enhance the operating arrangement. New Standard believes that ConocoPhillips? participation will inject invaluable and world class technical knowledge and resources to ensure the Goldwyer Project is explored and appraised in conjunction with a world leader in global shale plays.
Both parties have committed to an exclusive period to negotiate the proposed transaction with a target of executing binding agreements as soon as possible, but no later than 30 September 2011. The binding agreements will also be subject to any outstanding government approvals.
New Standard Energy Ltd. New Standard has agreed to notify ConocoPhillips of any approaches in relation to its interest in the Goldwyer Project during this exclusivity period, and to provide ConocoPhillips with a right to match any offers that relate to New Standard?s interest in the Goldwyer Project. New Standard Managing Director Mr Sam Willis said: ?We are delighted to have established the commercial framework to conclude a major deal with ConocoPhillips who are clearly a world leader in shale gas exploration and development.?
?ConocoPhillips is a very high quality partner for New Standard and will bring exceptional experience and endorsement to the Goldwyer Project to advance it from early stage exploration right through to development.?
?We look forward to the opportunity of working closely with the ConocoPhillips team to execute the transaction as quickly as possible and commence the proposed exploration activities on our Goldwyer Project.?

SUMMARY

In the last announcement under Subsequent Recent Events "The Company is actively seeking Farm-in interest to this prospective permit" This Canning Basin permit has a larger TCF potential than NSE in the Canning Basin and I believe OBL could strike a similar deal or better than NSE.

Also, native title approval as in the latest announcement "During the June 2011 Quarter, both the Operator Backreef Oil Pty Limited and the Company
attended compulsory mediation proceedings with
the relevant stakeholders. A number of meetings have progressed over the period 12 May 2011 to present and the Company is very pleased with the progress to date." I believe we could have this wraped up before xmas.

What would it do to our share price if we got a deal like NSE got and Native title approval before xmas? Remember OBL is USG and CSG operator. Farm in interest is very high.

My family and friends have about 5 million shares and 10 million options. We are confident OBL will be well over 6c before xmas. I would be very surprised if it is not. Good luck. DYOR.

PS I have not mentioned anything about oil potential.