advisory tonight, page-24

Lol sandys you may be riight, so maybe thats a lesson on not burning bridges?

Re the skiddable rig, if my memory serves me correctly, then:

- the rig was a new build rig
- it was going to do one job for someone else before SSN took delivery for its lease starting in August.
- lease cost is $14M over 18 months or $770K/month
- while it could be used on the Nth Stockyard infill wells, its skiddable capability for multi-well drill pads couldnt be used there due to the spacing constraints, and so that capability would be targeted for FP

Hopefully I've got the above right - feel free to correct if not.

So:

- Normally if a company is expecting to take delivery of a leased rig to start drilling a well, then it would issue an announcement advising "the rig is now being released from its current operator and will be moved to our site by xxx date" or something to that effect. Samson has done the same in the past.

- There has not been any such announcement yet, or anything other than comments in presentations since the 10-Q where the lease commitment of the rig was reported.

- If the rig is on track for delivery to Samson in August, then I would expect an advisory about it before the end of July (after all delivery could be near the end of August).

- As to where it will be used? I have been keeping an eye on the Montana O&G commission website for new permit listings - I have not seen any new permits for Fort Peck yet. This means it could only be used for the Australia 3 location, because the Australia 4 location is within the suspect Brockton fault band that Gretel may be in, so I wouldnt drill that one. But Australia 3 is currently permittted for a short lateral on a diagonal orientation in a single section spacing, like Australia 2. We know that lng laterals are the way to go, so to proceed with Australia 3, they would have to amend the permit to a 1280 acre (2section) spacing - I havent seen that listed either yet.

- So at this stage it doesnt look like it will go to FP in August, simply because the time to list/amend and approve a permit probably wouldnt allow it.

- Therefore if it is going to be used as soon as we start the lease it is going to Nth Stockyard 1st imo, even though the skiddable functionality wont be used. The infill permits are already done as I recall. And as oer above, an announcement about this should come out by the end of July by when delivery date of the rig is known if on time.

- If they arent go to use the rig straight away, then they will lease it out to another operator until ready, but I would expect an announcement about that sooner than the end of July, because they should have decided that earlier than the end of this month, just before they take delivery, and it would a material decision imo.

Imo the above should all be independent of what happens with SOA2, because the two activities are not related.

Cheers, Sharks.