Hi Rob, I understand that you are bullish SSN on fundamentals...

Hi Rob,

I understand that you are bullish SSN on fundamentals and management and our opinions diverge further as the rout gets deeper. May I suggest that such a backward looking view in the chart is dangerous. After all the bulk of the debt finance occurred during that time to drill into 1P Reserves - you should expect such an increase.

Forwarding looking binoculars are needed. Barely a little over 2 weeks ago you wrote "...I believe the production number currently achieved has been throttled to ensure sufficient cash is generated to fund the current modest development plans whilst not over producing and giving away too much with the low oil price..." I thought that was overly bullish at the time and that there is no way to substantiate the production number being throttled suggestion (or my opposite view in that the well is producing at the optimal rate to recover its EUR).

In any case, it is now shown that either SSN but more likely Slawson was somewhat unprepared for "increased line pressure in the regional gas gathering system" leading to restricted flow and equipment upgrades.

So the question becomes then, what are you thinking for July. Will you see production back up and over that of May (making June a mere hiccup)

I think you're also seeing just how slow the recovery in the oil price is. That channel of WTI between $50-$60 is showing signs of again breaking down below $50. IMO you wont see the BB lending institutions using "upgraded" price decks for the Sep/Oct revision season. On top of that SSN has been producing its 1P Reserves. In terms of volumes its possible 1P Reserves may go down.

You did say "always recommend people challenge my views" so I am doing that (nicely of course since we had many useful discussions) but I expect there will be some who choose to express less pleasantries.

Net Net - I was expecting better than this and I think the market was too. SSN was beaten down on Friday on higher volume. They are certainly not alone in that regard though as misery loves company.

GLTM