enercom valuation of ssn , page-9

Hi Matsim,

Many thanks for summarising this. Helps a great deal.

Correct, all they need to do now is prove this up and away we go.

Will be an interesting 6 months ahead!

And we haven't even factored in ORRI revenue or our current producers! (As you mention in your post below):

"To simplify it further, CHK bought 24166 acres from SSN and with 160 acre spacing would give you approx 150 wells.

Now if you take 3.8% ORRI from 150 wells, SSN would have approx 6 wells at 100%WI, based on TBs estimation of 413MBOE this would translate to 2,478,000 barrels of oil at no cost to SSN.

The fact the ORRI is spread over the entire acreage will further de risk the project, but as you can see the revenue has so much upside potential, especially if you use CHK formula which would more than double the volume.

These wells can have a life span up to 20 - 30 years which will provide SSN cash flow for many many years to come. IMO they will be bought out well before such time."

That to me translates to a LOT a LOT of money!!

Matsim quick question regarding CHK ORRI's - is what acreage provided previously (please see below) where we stand currently?

ACREAGE'S POST ON 18/6/11:

"Morning all,

well a big thanks to Terry for confirmation of these wells.From these figures,I would assume that SSN is now receiving payment from 4 wells CHK have up and running ?

We have a total of 13 ORRI wells including the 2 wells ( State 24-63 14-1H State 24-63 10-1H ) Samson part owns. A total of 4 wells are in the Codell formation and the rest 9 are in the Niobrara.

Once again thankyou to Terry for clearing this matter up.

Well Name Formation Well status Twn Rge Sec Company SSN Royalty

Intrepid Us 22 1-16H Niobrara Drilled and Fracced 236316 Chesapeake Operating Inc YES

Enterprise US 27 1-36H Niobrara Drilled and Fracced 236336 Chesapeake Operating Inc YES


Courageous US 26 1-16H Niobrara Drilled 246316 Chesapeake Operating Inc YES


Alhbrandt 23-63 4-1H Niobrara Drilled and Fracced 23634 Chesapeake Operating Inc YES


State 36-24-64 1H Codell Applied 246436 Chesapeake Operating Inc NO


Gleam US 11 State 1-16H Niobrara Drilled and Fracced 226416 Chesapeake Operating Inc YES


Clark State 24-63 26-1H Niobrara Applied 246326 Chesapeake Operating Inc YES


Brandt 21-24-63 1H Codell Applied 246321 Chesapeake Operating Inc YES


Brandt 24-63 21-2H Niobrara Applied 246321 Chesapeake Operating Inc YES


Hall 24-63 19 #1H Niobrara Drilled 246319 Chesapeake Operating Inc YES


Price State 24-63 15-1H Codell Applied 246315 Chesapeake Operating Inc YES


State 24-63 14-1H Niobrara Applied partly owned by SSN 246314 Chesapeake Operating Inc YES


Dvorak State 13-24-63 1H Codell Applied 246313 Chesapeake Operating Inc YES


State 24-63 10-1H Codell Applied partly owned by SSN 246310 Chesapeake Operating Inc YES


Yeik 35-23-63 1H Codell Applied 236335 Chesapeake Operating Inc NO


State 22-63 36-1H Niobrara Applied 226336 Chesapeake Operating Inc NO


Teeters 12-22-63 1H Niobrara Applied 226312 Chesapeake Operating Inc NO


Splinter 1-22-63 1H Codell Applied 22631 Chesapeake Operating Inc NO


Pheasant 23-62 25-1H Codell Applied 236225 Chesapeake Operating Inc NO


Newton Ranches 14-3444H Niobrara Applied 246434 Devon Energy Production Co NO


H&T Ranch 2-2344H Niobrara Applied 246423 Devon Energy Production Co NO

Terry also stated that this list is restricted to our immediate area,any wells south of township 21 are NOT included.

A good weekend to all."


Kind regards,
TI