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“It is too early to bury the Makó dream”

http://www.portfolio.hu/cikkek.tdp?k=2&i=124969

2009.11.27 07:30

It is too early to bury the "Makó dream," said Dr. György Szabó CEO of Falcon’s subsidiary TXM Kft. yesterday in a press conference. The research experiments did not reveal any circumstances that should give rise to pessimism - explained the Director. György Szabó added that merely there are difficulties and enormous technical challenges awaiting the company. But should they succeed, then in 2012 the commercial exploitation will start, following that the Makó wells could even cover the country's total gas consumption. About the recent statement by an official from the Szolnok Mining Bureau – in his remark György Szabó said that many parts of the statement is faulty, the observations and conclusions are wrong interpretation of the law, therefore he requested an immediate review at the Mining Bureau.

Yesterday, the Canadian Falcon Oil and its subsidiary the TXM Kft. have invited the journalists to a trip in the Makó trough. The company is engaged in the exploitation of Makó gas resource, and currently is conducting test production at the Magyarcsanád-1 well, following the suspension of operations by Exxon and MOL at the Földeák-1 well in the recent weeks.

In the press conference that followed the tour, Dr. György Szabó said, its rather too early to bury the "Makó dream", considering that the research have not encountered any new problem or circumstance that would make the project an impossible task. To be sure, there are difficulties, and it’s still not certain that we will be able to bring up the Makó gas resource, but the research results have not given us any indication that would give rise to pessimism.

The current concept is already working in America, so why would not work in our country – inferred György Szabó. Of course, the technological challenge continues to be extremely difficult. For example, fracturing the rocks is such a critical task, like the appropriate choice of liquid used in fracing, in our case it is very likely that instead of using the existing water-based liquids, we will be using synthetic material. György Szabó emphasized that the research continues to rely on the work by domestic research institutes and universities, and he wish to continue this practice.

In response to journalists' questions György Szabó explained that the company’s calculation the $ 50 oil price considered to be theoretical limit to ensure the profitability of the Makó project, but he immediately added that this is only a theoretical number, since currently the technology is experimental, and the exact cost is not known. However, one thing is certain, that over time the non-conventional research costs will decline, so it is not inconceivable that it will drop to 20% of the current levels.

As we know, a couple of weeks ago, the head of the Szolnok Mining Bureau, the Makó area’s Mining Authority, has made statements that the Bureau could take away the production licence from the Canadian company, if TXM would not start production by 2012, he also added that he doesn’t think that anyone else would be interested in the research area. György Szabó said, the statement is incomprehensible, because normally the Bureau’s task would be to promote the exploitation of the mineral resources, but if the Bureau chief believes that no one would be replacing Falcon, then how in the world the exploitation would happen? In the view of the TXM, the person in charge wrongly interpreted the law. Therefore the company - the same day as the article appeared in the paper - has submitted a notice to the Mining Bureau for a review; the company has not yet received a reply.

György Szabó pointed out, that the company already stated in the past, that the possible starting date for commercial production is in 2012. And if we found the right technique by then, the exploitation of the Makó trough will surge exponentially. After the start of the commercial production, optimally in 2-3 years the production from the Makó trough could meet the country’s total gas consumption of 13-14 billion cubic meters annually.

Nevertheless the aforementioned – in TXM’s leaders opinion the baseless and harmful to the company’s reputation - because of the Mining Bureau’s statements, now all the company's chances for listing on Budapest stock market has faded, which they wanted to accomplish, and not necessarily for fundraising, but rather in order to operate closer with the Hungarian people – said György Szabó.