Ann: JPR establishes Triassic flow rates from J-5, page-6

re: Ann: JPR establishes Triassic flow rates ... From SCE

Jupiter Energy (JPR)

750bopd from Kazakh oil well is a great result

Value of reserves could be higher. JPR has reported an excellent oil flow of 750bopd from the J-52 well in Block 31, Kazakhstan. This is much higher than the guidance of 500bopd and the 450bopd that we have used in our financial modelling assumptions for JPR. It seems the fracc and acid stimulation has worked very well. We won?t be changing our base case assumptions until we get some production history, but if we plug in 750bopd per well for the development scenario of a 25mmbbl oil field, our valuation for JPR would be $0.21/share rather than $0.18/share.

Watch short term news flow. JPR will have strong news flow over the next few months: (1) independent reserves report before end of March; (2) confirm stabilised flow rates at J-52; (3) Get south-easterly extension of Block 31 approved by Government; (4) Award of Trial Production License for J-50 well; (5) Test Z sandstone in J-52 well; (6) If successful, re-enter and test Z sandstone in Soviet well NWZ-2.

We continue to regard JPR as a very undervalued oil stock.

Recommendation: Spec Buy Previous Close: $0.058 Price Target: $0.18