fantale, interesting read in Street Talk today.Maverick, Gulf...

fantale, interesting read in Street Talk today.

Maverick, Gulf South deal could fund $200m drilling

Flying under the radar – at least on Wednesday – was high-flyer explorer Maverick Drilling and Exploration, whose farm-in deal with Gulf South Holdings has come up with some handy cash to fund up to $US200 million of drilling work in its shallow salt dome acreage in Texas.

If the deal completes as planned, New Orleans-based Gulf South will have the right to participate in the joint development of 400 or more wells, involving spending of $US100-$US200 million, across the shallow oil fairways of Maverick’s three salt domes through to the end of 2015. The program could be expanded to cover Maverick’s entire inventory of over 2000 development drill sites.

Gulf South will stump up $US250,000 per well for the term of the project for a 25 per cent stake in the drilling and production venture, then could increase its stake to 50 per cent for a further $US500,000 per well.

Maverick, the best performing stock on the ASX in the 2011-12 financial year, assessed the value of the deal at $US27 per barrel, compared with Maverick’s current market cap of about $5.25 per barrel of proven reserves.

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