an interesting play

To investors and traders alike,
i have been doing a fair amount of due diligence into SSN and i must say that it is starting to look the goods. After successfully fracc'ed the Leonard and flowing approx 300 bopd, they are now in the midst of drilling another two wells just west of the Leonard well.

SSN management has been pretty conservative in their estimates for these two wells (a good thing in the current environment to have) and stated an initial rate of between 300-500 bpod is achievable. Management has also indicated a plan to have 4 producers (1 producer currently, 1 well just spudded, 1 to be spudded at the end of Jan and 1 on the drawing board) and thus substantially increasing their net oil production in the current attractive pricing environments. In addition to this, they have also indicated a low-risk drilling plan in the Texas Gulf coast; namely the ripsaw and sabretooth prospects.

Management - proven and capable

Debt - been restructured and nominal but will need to be closely controlled

Prospects - Low risk plays, enormous potential with its share resources, neighbours - devon energy and Kodiak Oil and gas are drilling - results of those plans should trigger buying in SSN on the AMEX

Politics - working environment in the states is conducive towards oil and gas, tax revenues are nominal, no adverse hostilities nor environmentalists discouraging drilling

Financing - $8.5 million cash at bank to be put towards drilling plan this year

Share price - averaging 0.014 to 0.016; undervalued based on current producers

Push indicators - Spudding of Gene 124-H, results of drill plans, price of crude oil, PR engine, Roadshow etc

Comments - An interesting play and one to watch in the coming months.