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Global Innovation


in the Mississippian.


These are


meaningful production numbers, as they demonstrate good overall results from surrounding areas and provides support for AusTex’s belief that the Mississippian play extends further than had originally been thought.


The other major player in


the Mississippian is Devon Energy (DVN) who is aggressively moving forward with joint ventures to become the area’s leading integrated energy producer.


Devon recently announced a joint venture deal with Japan’s Sumitomo where Devon will sell a 30% interest in 650,000 acres in West Texas. Sumitomo agreed to pay $340 million and will commit $1.025 billion additionally for drilling, allowing Devon to invest more of its capital and resources into the Mississippian. Devon has also done a good job of increasing its operating cash flow and has been refinancing its debt so as to minimize impact of the heavily oversupplied natural gas market. Devon is not alone as there are plenty of other companies in similar


22 entrepreneurcountry


dire situations including Chesapeake Energy (CHK) who has been paying down debt by selling off natural gas assets.


There are also plenty of smaller upstarts with significant acreage positions in the Mississippian Lime including Petro River Oil.


This


private company is significant not only because it has purchased over 100,000 net acres in the Lime, but because it’s backed by the New York investment firm ICO Fund, a private equity fund focused on direct ownership of oil and gas assets. ICO was formed through the convergence of veteran oil and gas professionals, innovative technologists, leading entrepreneurs and experienced investment professionals utilizing advanced sciences to extract oil reserves.


They utilize leading


technologies and quantitative analytics to achieve impressive internal rates of returns.


PetroRiver,


with ICO’s backing has garnered the leadership of two CEOs, Daniel Smith and Ruben Alba, who combined have several decades of experience in


the oil and gas industry. Daniel has extensive prior experience with XTO Energy,


acquired by ExxonMobil


(XOM), and Ruben who brings an extensive oil service expertise to the company from Halliburton Energy Services and Superior Well Services. Ruben also holds several patents in completion technology.


Serving as


Senior Advisor is Luis Vierma, who spent several decades at Venezuelan state-owned oil and gas company PDVSA, where he served as the VP of Exploration and Production including a role as Venezuela’s Deputy Oil Minister to OPEC. Ironically, ICO is also an investor in AusTex.


So, it is truly impressive that we have been able to develop advancements in technology that allows us to drill much more efficiently and precisely for oil reservoirs in our own backyard, but better yet, that it provides us with the opportunity to


become


energy independent and diminish our reliance on Middle East oil and its messy politics. That is truly a pretty impressive feat indeed.


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