Samson Oil & Gas Limited (ASX: SSN; NYSE MKT: SSN):
TOTAL COMPANY PRODUCTION
Samson’s net monthly production for the December 2014 quarter is as follows:
| October | November | December | |||||||
| OIL, BO | 6,591 | 17,619 | 18,906 | ||||||
| GAS, MCF | 11,861 | 9,363 | 12,102 | ||||||
| BOE | 8,567 | 19,180 | 20,923 | ||||||
| BOEPD | 285 | 618 | 675 |
Samson’s net production by quarter for the calendar year ended December 31, 2014 is as follows:
| Q1 | Q2 | Q3 | Q4 | |||||||||
| OIL, BO | 29,430 | 53,317 | 35,074 | 43,116 | ||||||||
| GAS, MCF | 48,049 | 47,998 | 46,581 | 33,326 | ||||||||
| BOE | 37,494 | 59,041 | 43,361 | 48,670 | ||||||||
| BOEPD | 416 | 656 | 481 | 540 |
Samson’s net production for the year ended December 31, 2014 compared to its net production for the year ended December 31, 2013 is as follows:
| 2013 | 2014 | ||||||
| OIL, BO | 51,994 | 160,937 | |||||
| GAS, MCF | 174,300 | 175,954 | |||||
| BOE | 81,044 | 190,262 | |||||
| BOEPD | 222 | 521 |
The North Stockyard field continues to come back on line as the remaining three development wells (Billabong, Ironbank 6 and 7) are fracked. 5 existing wells around these wells remain shut-in whilst the recently drilled wells are fracked to prevent any damage to the well bores from this fracking activity. Harsh winter conditions have slowed the fracking operation.
HEDGE BOOK
Samson has the following hedges in place:
| Calendar year | Volume bbls. | Floor | Ceiling | ||||||
| 2015 | 18,270 | $85.00 | $89.85 | ||||||
| 2016 | 2,788 | $85.00 | $89.85 | ||||||
| Calendar year | Volume bbls. | Average per month | Swap | ||||||
| 2014 | 4,588 | 4,488 | $97.92 | ||||||
| 2015 | 39,791 | 3,316 | $92.61 |
As at January 9, 2014 the book value of the hedge was $2.7 million as valued by Samson’s counterparty.
NORTH STOCKYARD PROJECT, WILLIAMS COUNTY, NORTH DAKOTA
The infill development plan for North Stockyard consists of 8 middle Bakken wells that have been drilled and 22 Three Forks wells of which 9 have been drilled (8 in the First Bench and 1 in the Second Bench). Given the infill development curtailment there will remain an undrilled balance of 13 wells. For ease of reference, the current status of each well is set out below with separate tables for each drill pad:
| TOFTE 1 PAD |
Lateral |
Objective | Status |
IP rate |
Avg. Rate |
Cum to |
||||||||||||
|
Billabong |
6,147 ft. | Bakken | Frack scheduled for January | NA | NA | NA | ||||||||||||
|
Sail and Anchor |
6,375 ft. | Bakken | Shut in for frack program | 1,323 | SI | 56,233 | ||||||||||||
|
Blackdog |
8,383 ft. | Bakken | Shut in for frack program | 1,995 | SI | 109,878 |
|
|
Lateral |
Objective | Status |
IP rate |
Avg. Rate |
Cum to |
||||||||||||
|
Tooheys |
6,740 ft. | Bakken | On production | 1,078 | 543 | 74,806 | ||||||||||||
|
Coopers |
6,360 ft. | Bakken | On production | 556 | 388 | 55,417 | ||||||||||||
|
Little Creature |
7,578 ft. |
Bakken |
Shut in for frack program | 501 | SI | 72,284 |
|
MATILDA BAY |
Lateral |
Objective | Status |
IP rate |
Avg. Rate |
Cum to |
||||||||||||
| Matilda Bay
2-15-HBK |
4,215 ft. | Bakken | On Production | 1,117 | 82 | 31,191 | ||||||||||||
| Matilda Bay
1-15-HBK |
4,215 ft. | Bakken | On Production | 318 | 11 | 12,799 |
| TF NORTH PAD |
Lateral |
Objective | Status |
IP rate |
Avg. Rate |
Cum to |
||||||||||||
|
Bootleg |
7,211 ft. | Three Forks 1 | On production | 471 | 238 | 54,943 | ||||||||||||
|
Bootleg |
7,495 ft. | Three Forks 1 | Shut in | NA | SI | 49,866 | ||||||||||||
|
Ironbank |
7,466 ft. | Three Forks 1 | Requires a CTU cleanout | NA | NA | NA | ||||||||||||
|
Ironbank |
7,495 ft. | Three Forks 1 | On production | 528 | 471 | 15,609 |
| TF SOUTH PAD |
Lateral |
Objective | Status |
IP rate |
Avg. Rate |
Cum to |
||||||||||||
|
Bootleg |
6,867 ft. | Three Forks 1 | Frack completed, SI | NA | NA | NA | ||||||||||||
|
Bootleg |
6,973 ft. | Three Forks 1 | Frack completed, SI | NA | NA | NA | ||||||||||||
|
Bootleg |
6,771 ft. | Three Forks 2 | Frack completed, SI | 922 | NA | 922 | ||||||||||||
|
Ironbank |
7,434 ft. | Three Forks 1 | Drilling completed, awaiting frack | NA | NA | NA | ||||||||||||
|
Ironbank |
7,458 ft. | Three Forks 1 | Frack commenced | NA | NA | NA |
COMMENTARY
Frack operations have commenced on the Ironbank 7 well but have been hampered by adverse weather conditions. This frack is expected to be followed by Ironbank 6 and Billabong. A work over rig is currently over Billabong running the frack string.
#The Avg. Daily rate is an average of the last week’s production or the average after the well was put back into production.
BO: Barrels of oil
BOE: Barrels of oil equivalent (gas converted at its heating value)
BOPD: Barrels of oil per day
MCF: Thousand cubic feet
BOEPD: Barrels of oil equivalent per day
NA: Not available
APD: Application for Permit to Drill
IP Rate: Gross first 24 hour oil rate
Current rate BOPD: Barrels of Oil per Day
Cum to Date: Cumulative gross BO
Samson’s working interest and its net revenue interest for the North Stockyard Project is set out in the following table:
| Well | Working interest | Net revenue Interest | ||||
| Billabong 2-13-14HBK | 28.77220% | 22.01073% | ||||
| Sail and Anchor 4-13-14HBK | 25.028509% | 19.146809% | ||||
| Blackdog 3-13-14H | 24.863526% | 19.020597% | ||||
| Tooheys 4-15-14HBK | 28.232033% | 21.597505% | ||||
| Coopers 2-15-14HBK | 28.232033% | 21.597505% | ||||
| Little Creature 3-15-14H | 27.759719% | 21.236185% | ||||
| Matilda Bay 2-15-H | 32.972255% | 25.223775% | ||||
| Matilda Bay 1-15-H | 32.972255% | 25.223775% | ||||
| Bootleg 4-14-15TFH | 28.386344% | 21.715553% | ||||
| Bootleg 5-14-15TFH | 28.386344% | 21.715553% | ||||
| Ironbank 4-14-13TFH | 26.746521% | 20.461089% | ||||
| Ironbank 7-14-13TFH | 26.746521% | 20.461089% | ||||
| Bootleg 6-14-15TFH | 28.386344% | 21.715553% | ||||
| Bootleg 7-14-15TFH | 28.386330% | 21.715553% | ||||
| Bootleg 8-14-15H | 28.386330% | 21.715553% | ||||
| Ironbank 6-14-13TFH | 26.746521% | 20.461089% | ||||
| Ironbank 7-14-13TFH | 26.746521% | 20.461089% |
RAINBOW PROJECT, WILLIAMS COUNTY, NORTH DAKOTA
Gladys 1-20H (SSN 23%)
The Gladys 1-20 H well has been drilled by Continental Resources to a total depth of 19,994 feet. The well is a 1,280 acre lateral (approximately 10,000 feet) in the middle member of the Bakken Formation.
|
Lateral |
Objective | Status |
IP rate |
Avg. Rate |
Cum to |
|||||||||||||
| Gladys 1-20H | 9,558 ft. | Middle Bakken | SI | 717 | NA | 34,054 |
EXPIRY OF UNLISTED OPTIONS
The following unlisted options have expired, unexercised on 31 December 2014.
| Exercise Price | Expiry | Number of options | ||||
| $0.08 | 31 December 2014 | 60,500,000 | ||||
| $0.164 | 31 December 2014 | 4,000,000 |
Following the expiry of the above mentioned unlisted options, the Company’s capital structure is as follows:
| Class of share | Number of options | |||||
|
Listed |
Ordinary fully paid shares | 2,837,782,022 | ||||
| Options ($0.038 exp. 31 March 2017) | 229,634,519 | |||||
|
Unlisted |
Options ($0.155 expiring 31 October 2015) | 4,000,000 | ||||
| Options ($0.039 expiring 30 November 2017) | 4,000,000 | |||||
| Options ($0.033 expiring 30 April 2018) | 87,033,246 | |||||
Samson’s Ordinary Shares are traded on the Australian Securities Exchange under the symbol “SSN”. Samson’s American Depository Shares (ADSs) are traded on the New York Stock Exchange MKT under the symbol “SSN”. Each ADS represents 20 fully paid Ordinary Shares of Samson. Samson has a total of 2,837 million ordinary shares issued and outstanding (including 230 million options exercisable at AUD 3.8 cents), which would be the equivalent of 141.85 million ADSs. Accordingly, based on the NYSE MKT closing price of US$0.18 per ADS on January 12th, 2014, the Company has a current market capitalization of approximately US$26.1 million (the options have been valued at an exchange rate of 0.8244). Correspondingly, based on the ASX closing price of A$0.014 for ordinary shares and a closing price of A$0.003 for the 2017 options, on January 12th, 2014, the Company has a current market capitalization of approximately A$40.4 million.
