re:halliburtons, page-31

If HAL decide to not commit to the 2nd appraisal what would it cost SSN to drill magic us 38 #3-38h.

SSN have a current 37% WI in the JV and would increase to 43.25%

Mountain Energy (ME)also have a 37% WI and would increase to 43.25%

HAL would stay at 12.5% WI

If the well costs are $6M (approx)it would cost SSN $2.6M (approx) to drill the 2nd appraisal if the JV in place is charged at the percentage of the WI.

HAL would have been privy to the 3D Seismic Data and obviously liked what they saw to do a deal with SSN in the first place. Regardless of whether they decide to agree, it will cost them $ with every single well drilled, remember TB said we joint ventured with HAL more for strategic reasons rather than financial.

Never the less it would be more beneficial to have another well completed at no cost to SSN and to have HAL further commit to the project.

Cheers Matsim