I was surprised because SSN have limited cash and in my view need these funds available in the very short term for their 2 projects Roosevelt and Hawk Springs as they are yet to be proven. We don’t know how much cash will be needed or how many wells it might take, but its both these project which will give shareholders the biggest increases.
Whereas North Dakota hasn’t given SSN any real growth in terms of SP, just take a look at the last 3 wells Rodney, Earl, and Everett which have been good for cashflow but the market believes the 1200 net acres isn’t the future of SSN. Until we know what costs will be involved with the other projects North Dakota will always be there and can be done at any time subject to contractual arrangements.
SSN may not be the operator of North Dakota but I believe they have more say in the project than suggested. It was SSN who organized the frontier rig to start the infill wells
If you look at the operational update on 19.03.2012.
"Samson has entered into two contracts with Frontier Drilling."
“Frontier Rig 24 has been contracted for an 18 month period to drill wells in both the Roosevelt Project and in Samson’s North Dakota North Stockyard Field. Frontier 24 is a new build rig which is due to be completed in May/June 2012 and will drill one well before starting the Samson contract.”
Zavanna may be the operator but it has been very difficult for SSN to get them to complete their wells in the past hence why SSN may have organised the Frontier Rig.
GL Matsim
SSN Price at posting:
9.3¢ Sentiment: Hold Disclosure: Held
