SAMSON OIL & GAS LIMITED 
By HIGHLIGHTS FINANCIAL
- Cash receipts from debtors for the quarter was US$1.7 million
- Samson has recorded a closing cash balance for the quarter of US$42.4 million
OPERATIONAL- Fracking operations on the Everett #1-15H well in the North Stockyard Field, North Dakota commenced in December with 1.6 million pounds of proppant placed in 20 stages. The well flowed during drill-out operations as well as during the procedure to land the production tubing resulting in hourly measured flow rates varying from 528 BOPD to 2,112 BOPD. During the first 24-hour period of production, the well produced 1,373 BOEPD. The well has now been producing for two weeks at an average rate of 884 BOEPD.
- In the Hawk Springs Project (Goshen County, WY), Samson's first Niobrara appraisal well, the Defender US33 #2-29H, was fracked in 15 stages. Following year-end, the well was placed on pump and is currently producing between 400-500 barrels of fluid per day with a 30% oil cut. The Defender well is the now the most northerly located Niobrara oil well discovery in the D-J Basin.
- The Spirit of America US34 #1-29 vertical well was drilled, but was unsuccessful in reaching the Lower Permian and Pennsylvanian targets due to the bottom-hole assembly getting mechanically stuck in the Upper Permian Goose Egg Salt section. This well will be re-drilled at a later date this year in order test the two Permian and Pennsylvanian conventional targets down to a depth of 11,000'.
- On the Fort Peck Indian Reservation in
Roosevelt County, Montana, the Australia II 12 KA 6 well was
successfully drilled to a measured depth of 14,972' and the
Gretel II 12 KA 3 well is currently in the process of being
drilled. Both wells are scheduled to be fracture stimulated
during the 1st quarter of
2012.
- Samson's current land position in the Hawk Springs projects stands at 18,000 net acres after assuming that our farmin partner exercises their option to drill the second farmin well.
- Samson's current land position in the Roosevelt Project is 23,000 acres (subject to FPEC's back in right) and is most likely to be a net 31,000 acres (should Samson elect to exercise its current option and FPEC elect its back in right) with potential to grow that position to a net 35,000 acres with additional leasing activity.
SAMSON OIL & GAS LIMITED December 2011 Quarterly Report
DRILLING PROGRAMME 2012
Roosevelt Project, Roosevelt County, Montana Mississippian Bakken Formation, Williston Basin Australia II 12 KA 6 and Gretel II 12 KA 3Samson 100% Working Interest (subject to a 33.34% back-in)
Following the drilling of the two initial Bakken appraisal
wells [the Australia II 12 KA 6 well (completed) and Gretel
II 12 KA 3 well (in progress)], both wells will be fracture
stimulated and the production will be evaluated prior to
beginning the development program. If commercial production
is established at Australia II 12 KA 6 or Gretel II 12 KA 3,
the development program would commence and include the
drilling of the Australia III 12 KA 9
well (permitted) and the Australia IV 12 KA 16 well
(permitted and surface casing set).
Samson 37.5% Working Interest
The recent production from the first Niobrara appraisal well,
the Defender US33 #2-29H, is currently being evaluated in
conjunction with data taken from logs and core to determine
the next step to take in the development of the Niobrara
Formation. The Defender well was drilled and funded 100% by
Halliburton under
their farmin agreement. Halliburton can earn into a second
tranche acreage position within the Joint Venture
area by drilling and funding 100% of another Niobrara
horizontal well. The Defender well was completed with the
plug and perf process in 15-stages, which involved the
placement of 3,000,000 pounds of proppant into the Niobrara
Formation.
Spirit of America US34 #1-29
Samson 100% Working Interest
The Spirit of America US34 #1-29 well was unsuccessful in reaching the Lower Permian and Pennsylvanian targets due to getting stuck in the Upper Permian Goose Egg Salt section. This 11,000' vertical well test will be re-drilled at a later date in order test the original Permian and Pennsylvanian conventional targets.
State GC Oil and Gas Field, Lea County, New Mexico Permian Bone Spring Formation, Western Permian Basin State GC #2Samson 27% Working Interest
The Permian Bone Spring Formation in State GC#2 is waiting to be fracture-stimulated as soon as a frac crew becomes available to the operator.
Page 2 of 11
SAMSON OIL & GAS LIMITED December 2011 Quarterly Report
PROJECTS Roosevelt Project, Roosevelt County, Montana Mississippian Bakken Formation, Williston Basin Samson (Initially 100% subject to a 33.34% back-in)
Samson owns 22,643 acres of leasehold (subject to a 33.4%
back in) in the Roosevelt Project and retains the
option to acquire additional acreage within the project area,
which on a most likely case basis will result in
Samson having a net acreage position of 31,000 acres after a
back in has been exercised.
The first two initial wells, Australia II 12 KA 6 and Gretel
II 12 KA 3, are 4,500 foot laterals in the middle Bakken
Formation. The Australia II well was drilled in the
4th quarter and the drilling of the Gretel II
was in progress at the time of this report. Both wells will
be fracture stimulated using a multi-stage, external casing
packer completion technique by the end of the
1st quarter. Good gas and oil shows were
recorded on the mudlog while drilling through the Bakken
Formation in the Australia II 12 KA 6 well. Although not
expected to be drilled immediately, a permit has been
received for Australia III KA 9.
Following the drilling of the two initial appraisal wells,
FPEC will have the right to back into a 33.34% position by
reimbursing Samson's acreage and drilling costs to the extent
of that equity. In such an event, Samson will have a 66.66%
working interest and a 53.34% net revenue interest.
FPEC is owned by North American Resource Partners (NARP) and
the Assiniboine and Sioux Tribes. NARP is a portfolio company
of Quantum Energy Partners, a private equity fund with
substantial experience in energy transactions with Indian
Nations. While Samson is not part of FPEC or NARP, the
importance of having the Fort Peck Tribes as equity partners,
albeit indirectly, was an important part of Samson's decision
to invest in the Roosevelt Project.
Page 3 of 11
SAMSON OIL & GAS LIMITED December 2011 Quarterly Report
North Stockyard Oilfield, Williams County, North Dakota Mississippian Bakken Formation, Williston BasinSamson various Working Interests
Samson now has seven producing wells in the North Stockyard
Field after the Everett #1-15H well was fracture stimulated
in December. These wells are located in Williams County,
North Dakota, in Township 154N Range
99W.
1. The Harstad #1-15H well (34.5% working interest) averaged
36 BOPD and 12 Mcf/D for the quarter from the Mississippian
Bluell Formation. The well has performed as expected with a
cumulative gross production of 95 MSTB and 82 MMcf.
2. The Leonard #1-23H well (10% working interest, 37.5% after
non-consent penalty) averaged 43
BOPD and 54 Mcf/D during the quarter. This well was drilled
as a horizontal lateral into the highly productive middle
member of the Bakken Formation. To date, the Leonard #1-23H
well has produced approximately 91 MSTB and 89 MMcf.
3. The Gene #1-22H well (30.6% working interest) produced at
an average daily rate of 58 BOPD and
32 Mcf/D during the quarter. The average daily rate is lower
this quarter due to the well being worked over for rod pump
failure and tubing failure. The cumulative production to date
is approximately 104 MSTB and 115 MMcf.
4. The Gary #1-24H (37% working interest) well averaged 121
BOPD and 180 Mcf/D during the quarter. The cumulative
production to date is approximately 101 MSTB and 161
MMcf.
5. The Rodney #1-14H (27% working interest) well produced at
an average daily rate of 181 BOPD
and 302 Mcf/D. The cumulative production to date is
approximately 64 MSTB and 75 MMcf.
6. Earl #1-13H (32% working interest) well produced at an
average daily rate of 289 BOPD and 360
Mcf/D. These average rates take into account several down
days due to well workovers. Cumulative production to date is
approximately 97 MSTB and 125 MMcf.
7. The Everett #1-15H well was the sixth Bakken well drilled
in the North Stockyard Field and was fracture stimulated in
December. During the first 24-hour period of production, the
well produced
1,176 BOPD and 1,180 Mcf/D. The well has produced at an
average daily rate of 740 BOPD and
865 Mcf/D during its first two weeks of production.
Samson's net average daily (after royalties) production rate
for the quarter is set out below:
Well | Net Mcf/D | Net BOPD | Net BOEPD |
Leonard #1-23H | 0.69 | 3.17 | 3.29 |
Harstad #1-15H | 3.10 | 11.1 | 11.62 |
Gene #1-22H | 1.33 | 12.49 | 12.71 |
Gary #1-24H | 43.86 | 34.16 | 41.47 |
Rodney #1-14H | 37.64 | 40.06 | 46.33 |
Earl #1-13H | 80.49 | 68.70 | 82.12 |
Total | 167.11 | 169.68 | 197.53 |
Production for the Davis Bintliff #1 well averaged 4.3 MMcf/D and 48 BOPD for the quarter, which is essentially a constant rate from inception. Cumulative production to date is approximately 4.2 Bscf and 50 MBO.
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SAMSON OIL & GAS LIMITED December 2011 Quarterly Report
Diamondback Prospect, Jefferson County Texas Oligocene Marginulina Frio Sandstone, Gulf Coast Basin
The Diamondback #1 well was scheduled to spud in June 2011,
but as is normal practice, a title opinion was obtained ahead
of commencing drilling operations. This opinion provided some
uncertainty as to the ownership of a lease that had been
acquired previously by Samson, which with a contiguous
(undisputed) lease gave Samson 100% equity in the prospect.
Samson has been endeavoring to resolve the ownership and is
continuing to sort out the title issues.
The well will be located in Jefferson County, Texas
approximately 9.5 miles south of the town of Fannett. The
well has been permitted to a depth of 8,900 feet to test a
bright spot anomaly in the prolific Oligocene Marginulina
Frio sand.
The State GC oil and gas field is located in Lea County, New
Mexico, and includes two wells, which produced at
an average rate of 48.6 BOPD and 81.0 Mcf/D. This rate is
expected to increase after the Permian Bone Spring Formation
interval in the State GC#2 well is fracture stimulated. This
operation has been delayed because of the unavailability of
hydraulic fracturing services.
Samson is currently evaluating new production data and core
data from the Defender US33 #2-29H well in
preparation for the design of a new Niobrara well. The last
outstanding lease is being finalized so that a replacement
well for the Spirit of America well can be drilled in the
second quarter of 2012.
Samson has two contiguous areas in the Hawk Springs Project.
One of the areas is a joint venture with a private company
and is subject to the Halliburton Joint Venture (HJV). Post
completion of the Halliburton farmin, Samson will have a net
5,125 acres and outside of the HJV area Samson has a net
13,079 acres, amounting to total net acreage of 18,199 acres.
Within the HJV area Samson will remain Operator; however,
Halliburton will be providing project management services
along with regular oil field services to effect the drilling,
completion and fracture stimulation of the wells drilled.
The Harrod 4-2 well has been producing steadily and has averaged 9.1 BOPD for the quarter.
PRODUCTION
GAS Mcf GAS US$ | OIL Bbls OIL US$ | TOTAL US$ | |
September Quarter | 59,181 321,174 | 24,912 2,096,645 | 2,417,819 |
December Quarter | 58,487 279,433 | 18,580 1,679,698 | 1,959,131 |
In some cases revenue is yet to be received and is therefore an estimate
The quarterly oil production was down principally because the Gene well in the North Stockyard suffered both a tubing and rod pump failure and was consequently out of production for a month during the quarter. This well is currently being worked over.
Page 5 of 11
SAMSON OIL & GAS LIMITED December 2011 Quarterly Report
Average commodity prices:
GAS US$/Mcf | OIL US$/Bbl | |
September 2011 Quarter | $5.42 | $84.16 |
December 2011 Quarter | $4.77 | $90.40 |
Given that Samson's business is conducted in the US, the
Directors determined that the company's cash balance should
be maintained largely in that currency. In order to diversify
the deposit risk, a treasury management policy was adopted
such that the cash was distributed as follows:
Bank of the West (Samson's trading bank) US$1,441,352
Bank of New York Mellon US$25,015,534
National Australia Bank US$10,018,913
National Australia Bank A$5,938,249
The closing A$:US$ exchange rate on 31 December 2011 was
1.0156. The average A$:US$ exchange rate for the quarter was
1.0118.
The Company's cash position at 31 December 2011 was as
follows:
US$ ('000's) | ||
Cash at bank and on deposit | : | 42,404 |
42,404 |
For and on behalf of the Board of
SAMSON OIL & GAS LIMITEDFor further information please contact
Denis Rakich, Company Secretary, on 08 9220 9882
TERRY BARR
Managing Director
31 January 2012
Information contained in this report relating to hydrocarbon reserves was compiled by the Managing Director of Samson Oil & Gas Ltd., T M Barr a Geologist who holds an Associateship in Applied Geology and is a fellow of the Australian Institute of Mining and Metallurgy who has 30 years relevant experience in the oil & gas industry.
Page 6 of 11
SAMSON OIL & GAS LIMITED December 2011 Quarterly Report
Appendix 5B
Mining exploration entity quarterly report
Introduced 01/07/96 Origin Appendix 8 Amended 01/07/97, 01/07/98, 30/09/01, 01/06/10, 17/12/10
Name of entity
Samson Oil and Gas Limited
Rule 5.3
ABN Quarter ended ("current quarter")
25 009 069 005 31 December 2011
1.1 Receipts from product sales and related debtors
1.2 Payments for (a) exploration & evaluation
(b) development
(c) production
(d) administration
1.3 Dividends received
1.4 Interest and other items of a similar nature received
1.5 Interest and other costs of finance paid
1.6 Income taxes paid
1.7 Other (provide details if material)
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SAMSON OIL & GAS LIMITED December 2011 Quarterly Report
1.13 Total operating and investing cash flows (brought forward) | (11,767) | (15,978) |
Cash flows related to financing activities 1.14 Proceeds from issues of shares, options, etc. 1.15 Proceeds from sale of forfeited shares 1.16 Proceeds from borrowings 1.17 Repayment of borrowings 1.18 Dividends paid 1.19 Other (provide details if material) Net financing cash flows | 6 - - - - - | 296 - - - - - |
Cash flows related to financing activities 1.14 Proceeds from issues of shares, options, etc. 1.15 Proceeds from sale of forfeited shares 1.16 Proceeds from borrowings 1.17 Repayment of borrowings 1.18 Dividends paid 1.19 Other (provide details if material) Net financing cash flows | 6 | 296 |
Net increase (decrease) in cash held 1.20 Cash at beginning of quarter/year to date 1.21 Exchange rate adjustments to item 1.20 1.22 Cash at end of quarter | (11,761) 53,947 218 | (15,682) 58,448 (362) |
Net increase (decrease) in cash held 1.20 Cash at beginning of quarter/year to date 1.21 Exchange rate adjustments to item 1.20 1.22 Cash at end of quarter | 42,404 | 42,404 |
Current quarter
$US'000
1.23 Aggregate amount of payments to the parties included in
item 1.2 180
-
1.24 Aggregate amount of loans to the parties included in
item 1.10
1.25 Explanation necessary for an understanding of the
transactions
Monies paid to Directors for salary and fees
2.1 Details of financing and investing transactions which
have had a material effect on consolidated assets and
liabilities but did not involve cash flows
2.2 Details of outlays made by other entities to establish or
increase their share in projects in which the reporting
entity has an interest
Page 8 of 11
SAMSON OIL & GAS LIMITED December 2011 Quarterly Report
Financing facilities availableAdd notes as necessary for an understanding of the position.
3.1 Loan facilities
3.2 Credit standby arrangements
4.1 Exploration and evaluation
4.2 Development
4.3 Production
4.4 Administration
Reconciliation of cash
Reconciliation of cash at the end of the quarter (as shown in the consolidated statement of cash flows) to the related items in the accounts is as follows.
Changes in interests in mining tenements6.1 Interests in mining tenements relinquished, reduced or lapsed
Page 9 of 11
SAMSON OIL & GAS LIMITED December 2011 Quarterly Report
6.2 Interests in mining tenements acquired or increased
Issued and quoted securities at end of current quarter - all reference to option exercise price is in AUSTRALIAN DOLLARSDescription includes rate of interest and any redemption or conversion rights together with prices and dates.
7.5 +Convertible debt securities (description)
7.6 Changes during quarter (a) Increases through issues (b)
Decreases through securities matured, converted
Page 10 of 11
SAMSON OIL & GAS LIMITED December 2011 Quarterly Report
7.12 Unsecured notes (totals only)
Compliance statement
1 This statement has been prepared under accounting policies
which comply with accounting standards as defined in the
Corporations Act or other standards acceptable to ASX (see
note 5).
2 This statement does give a true and fair view of the
matters disclosed.
Sign here: | ............................................................ | Date: 31 JANUARY 2012 |
Print name: | (Company secretary) Denis Rakich |
Notes
1 The quarterly report provides a basis for informing the market how the entity's activities have been financed for the past quarter and the effect on its cash position. An entity wanting to disclose additional information is encouraged to do so, in a note or notes attached to this report.
2 The "Nature of interest" (items 6.1 and 6.2) includes options in respect of interests in mining tenements acquired, exercised or lapsed during the reporting period. If the entity is involved in a joint venture agreement and there are conditions precedent which will change its percentage interest in a mining tenement, it should disclose the change of percentage interest and conditions precedent in the list required for items 6.1 and 6.2.
3 Issued and quoted securities The issue price and amount paid up is not required in items 7.1 and 7.3 for fully paid securities.
4 The definitions in, and provisions of, AASB 6: Exploration for and Evaluation of Mineral Resources and AASB 107: Statement of
Cash Flows apply to this report.
5 Accounting Standards ASX will accept, for example, the use of International Financial Reporting Standards for foreign entities.
If the standards used do not address a topic, the Australian standard on that topic (if any) must be complied with.
== == == == ==
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| Documents associés | |
| December 2011 Quarterly Report and Appendix 5B |
