Ann: Development Update , page-6

Spec from SAA Advisory - SEA is SDCjf.pk from the pink slip codes.

OUR STOCK PICK OF THE UNIVERSE CONTINUES TO DELIVER EXCELLENT RESULTS AND WE CONTINUE TO POUND ON THE TABLE THAT THIS STOCK HAS TO BE BOUGHT--AWRCF.OB-- SEE OUR CURRENT BRIEF!

Obama: you blew it! healthcare, bailouts, wasted $860 billion,continued welfare hand outs, looming tax increases all yields uncertainty- that is why America refuses to hire! Wake UP!
Sept 07, 2010

Recent oil and gas domestics that we have recommended:

BEXP-- $3.25---current price $17.11-

One of the early pioneers in horizontal frac in the Bakken in ND- remains a core holding and Strong Buy on any weakness. Most likely a takeover candidate within the next 6-12 months as the Bakken consolidates. Capitalism at work and creating "real' jobs! Thank You BEXP!

AXAS--.96-- Current price $2.57-

Remains one of our favorite domestic oil and gas E & P. Just signed a jv for $100 million to develop the Eagleford Shale area in TX. Participation in the Bakken continues to grow & other drilling continues in the Rocky Mountains & Canada. We continue to rate AXAS with a Strong Buy rating at current levels. We also believe that within 6-12 months AXAS will also be a takeover candidate. Insider buying has been heavy with little to no selling. This also remains our largest holdings!

USEG-$2.75-- current price--$4.38-

Well off the 52 week high, but still a winner. USEG was a "pilot fish" of BEXP and blasted-off during Oct 2009 running to $7.00 and then again during April of 2010. Current not a favorite of the street- I believe that analysts would prefer greater diversification within management and the board and less corporate spending. The money raise during late 2009 or early 2010 capped the run and management still promises a new drilling program, but as of yet we just hear "white noise". We are kinda in the Hold mode!

KOG- $1.28--- current price $2.68

Another favorite and potentially a huge winner. KOG just completed another $75 million raise for further development of their 55k net acres in the Bakken. Capex for 010 anticipated at around $75 million, which will be for the drilling of some 20+ wells in the Bakken. Management estimates exist 2010 with production of 2500 Boepd up dramatically from 2009 levels of around 800 Boepd. Management assumes that they have some 213 drill sites available for development. This is one Bear that I would not short!! The recent raise may cause near term flat line, but we believe KOG remains a winner and potentially a tracker of BEXP. We rate KOG with a Strong Buy rating at current level.

SSN- $.59 current price $1.38

Recently recommended via June 1, 2010 email alert. Presently everyone is waiting for the close of their property sale that will result in some $70 million in cash, which will be used to develop their remaining Niobrara & Bakken properties. They also are trying to finish up some problematic Bakken wells. The closing date is today so all the anticipation we assume is already built into the stock. We believe that until a drilling program is formulated and success occurs we see limited upside potential near term. We rate SSN with a Strong Hold and Buy on any weakness @ the $1.00 level if there are no corporate negatives. A well run junior Australian based E & P with the vision to Buy acreage on the cheap a few years ago and now have created a real "game changer" for itself! An excellent management team that has huge growth potential if they 'hit" in the Niobrara within their remaining acreage!

CMT.TO--.72- current price .$44

Mostly a NG play in Canada that has issues. Recently sold some acreage and raised some $150 million, which was used to pay off debt & the balance to be used for working capital. Capex for 2010 anticipated to be in the range of $60-$70 million. The main problem is NG has no legs and until it gets some "footing" most if not all NG plays can be very hurtful to investors. The company is working on a recap of debt- $450 million in Senior Notes for cash and "new" notes. On or about July 7th of 2008 when oil was trading @ $150/barrel or so- our little friend traded @ $13.00! So at .44 there is very little risk left! New management has turned CMT.TO around and survival is not a question any longer. We like it and own a bundle. The real risk is not owning CMT.TO or CMZPF.PK at current levels and rate it with a Strong Buy for more Speculative accounts!

AEZ-$6.44--- current price---$7.53

Bought out by HESS- At this point I would sell it! Short term hold for a short gain!

SDCJF.PK- .17US --current price .29US--

Our most recent recommendation: See email alert for July 1, 2010. Sundance Energy ( another Australian based corp that has all of its business in the USA. In Australia it trades with the symbol SEA. If you would like to review all financial and other dd go to the site www.asx.com.au and review the PDF's for SEA). We continue to rate SDCJF.PK with a Strong Buy rating even though it has almost doubled from our initial recommendation some 65 days ago. The current reserves exploded from last year, the drilling success continues ( some wells have fractional interest while others yield some 25% interest), has cash and no debt. Much of their property-95% is not included in recent reserve report. All investors need to visit www.asx.com.au and use the symbol SEA and review the August 23rd 2010 presentation. The company has 65k acres within the Bakken and the Niobrara plus other properties. Management estimates that sdcjf.pk will exist 2010 with 800-1000 Boepd in production. We like management, the properties, the potential and the current share price and still rate SDCJF.PK with a Strong Buy rating @ current levels. As mentioned within the July 1, 2010 email alert recommendation- the company intends to participate in 40 wells during 2010 and I believe that they have not hit a dry hole yet!! A great speculation and micro-mini cap with unlimited upside potential within some of the hottest drilling areas in the USA!