hartleys report bakken results encouraging, page-2

Niobrara Drilling Approaches at Hawk Springs Project


The Company had previously announced that drilling may commence in early Q2; however, we understand that final processing of 3D seismic to determine fracture identity is yet to be completed. Consequently, the preferred well location has not been decided.

A technical meeting with joint venture partner,
Halliburton, is scheduled for early April. Post this meeting, a more definitive timeframe is likely to be announced. We now expect drilling to occur prior to mid-year.Samson has a 100% working interest in 10,000 acres in the Niobrara and a 45% working interest in a further 10,000 acres, where it has recently executed a farm-out to Halliburton. Halliburton will fund the drilling and completion of two proof of concept wells to earn 2,819 acres.

Results from over 30 recent wells into the Niobrara have achieved average initial production of 678 barrels of oil per day. Well costs, drilled and fracture stimulated, have averaged With these parameters, we estimate that the play has attractive economics.

If Samson can emulate these results on its acreage, we calculate upside potential of 36cps from the Niobrara alone (using 160 acre well spacing).Additional upside is possible from closer spacing, lower costs, increased
ultimate recovery estimates and acquisition of additional acres in the Niobrara or the Bakken.
We rate Samson Oil and Gas Ltd as a Buy and have increased our 3 month price target from 18cps to 21cps.