zu Terax:
Sep 13, 2007 (Fort Worth Star-Telegram - McClatchy-Tribune Information
Services via COMTEX) --
Terax Energy, a small Dallas energy company that boasted of its Barnett
Shale production, is at the center of a lawsuit filed by the Securities and
Exchange Commission against the company, two Los Angeles residents and the
Beverly Hills oil company they control.
Early Wednesday, the SEC temporarily suspended trading in Terax shares,
which are traded over the counter, saying "questions have been raised about
the accuracy and adequacy" of the company's disclosures of its operations,
financing, pending transactions and "the identity of the persons in control
of the operations and management of Terax."
The agency later sued in Dallas federal district court, claiming fraud and
seeking to freeze the defendants' assets.
According to the SEC's complaint, Mark Roy Anderson, 53, a felon and
disbarred lawyer, in late 2006 solicited a Dallas resident in an effort to
raise $5 million for Westar Oil of California. The offering promised a "huge
play" in Nye County, Nev., that would increase Westar's value tenfold.
By March, 30 of the Dallas resident's friends and relatives, most of them
Texans, had invested just over $1 million in Westar. Five later sought and
received refunds totaling $170,000, the suit says.
On May 1, the suit alleges, Linda Contreras, an Anderson associate and the
new chief executive of Terax, filed an SEC report announcing that Westar had
agreed to buy 55 percent of Terax's shares. On June 8, Terax issued a news
release announcing that it was extending its leases in Erath County,
southwest of Fort Worth, and expected six wells to generate more than
$750,000 per month in oil and gas within 30 days.
But the SEC said that on June 1 the owner of Erath County mineral rights had
told Terax that he was terminating the leases for failure to pay royalties
and had locked the company out of the well sites, and on June 6 the leases
were put into receivership. Texas Railroad Commission records, the agency
charged, showed that the wells operated only a few months in mid-2006 and
produced only about $100,000 worth of petroleum before being shut in.
A phone call to Westar's offices was not returned. Terax officials also
could not be reached.
In its previous disclosures, Terax claimed to hold 27,500 gross acres in
Erath and Comanche counties, which are on the western edge of the Barnett
Shale. Of the nearly 200 drilling rigs working in the Barnett Shale as of
Sept. 7, four are in Erath County and none are in Comanche County, according
to RigData.
Terax's shares were at $2.65 when trading was suspended. In the past year
they have traded as high as $15, one year ago, and as low as 13 cents, in
April.