This is not promoting either Oasis Petroleum (NYSE:OAS) or...

This is not promoting either Oasis Petroleum (NYSE:OAS) or American Patriot Oil & Gas (ASX:AOW).

Early research suggests the acreage being acquired comes from OAS. I've put up a few Montana O&G Commission production plots for potential shut-in wells that might be part of the package just to see what the Ratcliffe and Mission Canyon formations produce (collectively with Charles formation known as the Madison group and they are right above the Bakken/TFS formations)

Interesting, SSN will not be alone in pursuit of the conventional and hybrid unconventional in this area.

AOW did its IPO on ASX in 2014. Part of the IPO is the Northern Star Project (NSP) in Montana.

AOW allocated its funds as:

Acreage acquisition of NSP $666,667 for net 9,233 acres (or $72/acre). This would appear to be undeveloped acreage with 1P Reserves (IMO it would be PUD) of 215MBO (or $3.10 per 1P BO). They were also free carried for their share (30% WI) of 2 Hz wells which equates to a net $1.425M using AOW midpoint estimate of HZ well cost. Of course that's not really what they paid and AOW talks about selling acreage at 3 times what they paid for it as well as the well carry to farmout 70% interest.

Their NSP acreage is "functionally equivalent" to what SSN acquired as there is low chance of Bakken/TFS success and the targets are the Madison Group formations above.


I would recommend reading AOW IPO Prospectus from 2014 - especially Section 11 - which effectively is Reserves Report prepared by MHA Petroleum as well as Section 14 - which covers the JV farmout in NSP. Also relevant in that Section 11 report for SSN shareholders is the Paradox Basin acreage. Their investor preso is worth a browse as well.


IMO it shows again the value brought to SSN if it can close the deal (I say if since the offer is conditional on MOB agreeing to increase the BB and if I were MOB I would do it purely on the basis of it adds scale to reserves and production. Up to TB/SSN to prove to MOB that potentially this acquisition makes SSN stronger (and therefore their debt less risky) due to short term low cost recompletions.

Now if only OAS would tell EDGAR what they sold or SSN what they bought. Guess that comes Feb 1.

Also guessing TB keeps his job