SGY are just about to start drilling a low risk/high impact...

SGY are just about to start drilling a low risk/high impact appraisal well offering recoverable gas potential of 40 BCF with upside of 100BCF...

UPCOMING DRILL

Southeast Lost Hills Project (SGY: 100%, Operator) POTENTIAL VALUE: A$0.28-1.38

◆ SGY currently have 2 wells producing at commercial rates just over 1km from their next drill which is due to spud on Wednesday and is considered as an appraisal well.

◆ 3-D seismic coverage across major acreage position of 5,120 acres- large gas prospect located in the San Joaquin Basin, California

◆ Development potential enhanced by excellent gas pricing, low drilling costs, shallow reservoirs, strong local gas demand and existing infrastructure- SGY now owns 100% of gas plant and pipeline infrastructure

OTHER PROJECTS

Maricopa Project (SGY: 50%, Operator) POTENTIAL VALUE: A$0.13-0.15

◆ Low risk oil development project located within the boundaries of one of the largest onshore oil fields in the world (Midway Sunset)- SGY has trebled original acreage position

◆ Existing oil production: Two successful wells drilled; one well currently producing oil and the other shut-in

◆ Numerous low cost and low risk drilling locations identified- potential to significantly enhance current production by drilling low risk wells

Deer Creek Project (SGY: 50%, Operator) POTENTIAL VALUE: A$0.22-0.30

◆ Located on the eastern side of the oil and gas rich San Joaquin Basin, near the southern boundary of Tulare County- Exploration play surrounded by two analogue fields with estimated recoverable oil reserves of 3-6 MMbbls

Silverthread Project (SGY: 18.5-20.0%) POTENTIAL VALUE: A$0.18 plus

◆ Potential low risk oil appraisal and development project- located in the prolific Ventura Basin

◆ A 495 foot oil column discovered in Nesbitt #5 has been confirmed by Schlumberger

SUMMARY

◆ Recent appointment of John Begg as Managing Director is a big endorsement for SGY's project portfolio. He has a proven track record for finding oil & gas i.e. Voyager, Salinas and Arc Energy

◆ Over the coming months SGY will be participating in several high impact wells which could substantially re-rate the company

◆ SGY currently has existing oil and gas production from 2 projects and boasts appraisal opportunities across its portfolio and IMO is one of the most undervalued oil/gas companies on the ASX.

JB

PS: Some of this info may have already been posted on the SGY thread- just back from holiday and getting back into the swing of things...