that runaway well, page-3

Thought would not post this weekend, but as doing some work from home, just wanted to add to Dalek post from the US forum (you can downloand this spreadsheet here if you want:
https://docs.google.com/leaf?id=0B-86qfVrGvvXZGFiMjUyYTMtNmRhMS00MmIyLTgxNjctNTFmMGVmNGFmMGQ2&hl=en
Hope it works or go to Yahoo Message Board for SSN and find posting for October Production figures.

WORD OF CAUTION
Just be careful when reading the spreadsheet that it does not include the 1,000BOPD for Gary (37% for SSN) for the whole quarter - as we know there will be drop off from these figures - so please take this into account with your calcualtions. If you are conservative like me maybe something like 50% or 500BOPD for the quarter would be a great result - I think after 17 days it was doing 955BOPD per day on average. Do not get me wrong this is a very good well but just keep things real, add this to current cashflow and it should mean cash inflows will enable us to get $3m back of the $5.8m we are spending this quarter before Rodney and Diamond Back results. Minimal burn rate for upfront capital expenditure, remember Rodney and Earl drilling costs have been paid from last quarter cashflow.

You could also add 40BOPD x 34.50% for Harstad (has averaged this for the last 3 quarterly reports) then this will give a clearer picture.

The cash burn rate is my main focus at present - remember you can make profit (which involves all great calculations like impairment costs, depreciation, future income tax benefit all non cash items) and still go broke - but positive cashflow or negative initial cashflow for long term return with strong cash backing and you increase the chances of success.

Great posts of articles on the Niobara even if a well was to average 300BOPD for 6 months at 100% that would be $4m in cashflow for 6 months, paying the cost of the well within 6 months. But let's not get to far ahead of ourselves, not in my calulations yet but will be fun when (if) I can finally add to the spreadsheet.

This spreadsheet is really an extension of the great timeline posts from 101INVESTOR and turns these targets into cash amounts:

This is a good approach to budgeting - draw the plan and then determine costs and then determine breakeven and then determine what income you want to make - once you determine the income then try to breakdown what you need to do to achieve that income i.e. number of customers x average sales or in the case of SSN number of wells x production rates x price of oil/gas. Work out if achievable and what cash you need and if you tick all the boxes off you go.

My approach is to keep the 101INVESTOR summary handy (great work by the way), read all announcements, use HC to get some feedback on stuff I do not understand in relation to O&G - plenty I don't, tick boxes when progress made and try to put a $$$$ to what it will mean to the company on my spreadsheet. If they continue to tick the boxes keep holding and adding if possible, if more misses (cash position will allow us to have some misses) than hits then time to consider getting out. Fast cash burn for little return not a good sign. Every tick adds long term value to the company - may take time for market to catch up on, so be it I call this opportunity if I think it is going to plan. But implementation takes time when you are a small player.

I used this approach with BDR (I know nothing about gold, nothing) but was given a list of what this company planned to do by a friend who was given to him by his broker - small initial investment (now my biggest spec holding, sorry more than SSN) - my list nearby - each announcement ticked off list (all ticked at the moment), initial market reaction nothing even went backwards, opportunity to add to holding, but those that understood soon jumped in to buy off screen - we have also had bots/sub share. changes to play with the price, market reaction since first purchase took a couple of months for it to catch on, now up 150% on intial purchase, one box left to tick due early November - then decision hold (with lots of new friends on HC) or sell? Kinda playing out similar to SSN, please note not saying to buy this share unless you understand the risks but just as comparison to current SSN position.

I think we should be grateful that we have some great posters on this forum doing the hard yards and trying to put sense to this company for that we should really applaud them - checkout the BDR forum it is a lonely place, lucky I can lean on my friend for feedback.

Nothing is for certain, and as anyone in business will tell you no one can guarantee you it will hit the targets, but at the moment SSN in my eyes has a greater chance than most and I hope it really changes the life in a positive way for those that have taken the time to research and share this information.