Here goes, a back of the envelope valuation for our little gem....

Here goes, a back of the envelope valuation for our little gem. Steini, keep selling.

Samson?s Dec Half yearly showed profit of approx. $1.1 on sales of approx. $3.3. Steini, my awesome power of observation extrapolates that to Full year profit of $2.2M

Please note, this was on 3 wells with oil at $70-$80 per barrel. From above we can see that 1/3 is profit. So cost is approx. $50/barrel. With Oil at around $100, that same profit now DOUBLES to $4.4M p.a. ?again on 3 wells.

Bakken
Bakken now has 3 more wells on line, Rodney, Earl, Everett (just about) ? add another $4.4m
Last presentation shows 3 more wells at 320 spacing to be drilled ? add another $4.4m

The Bakken will be giving us $13.2M pa. profit.

Niobrara
11 Wells by year end (give or take) with 75% interest (25% to Haliburton) if all goes well. At 30% 9 wells gave us $13.2M. Using some basic maths, I get 11 wells at 75% interest giving us $40.3M Profit.

Total profit within the next 12 months could be around $53.5M. P/E of 12 would give a business value of $642M. Shares on issue 1.8B, share price around 35c. Now we all know it will trade higher due to potential. Let me elaborate.

Niobrara can give us another 80 wells (I recall reading a previous announcement referring to 100 wells). Assume Samson could drill 20 wells per year, then within 5yrs...

If 11 wells give us profit of $40.3M, 80 wells will give us profit of $293M.

Again using P/E of 12, 293M + 53M from Bakken and initial Niobrara 11 gives SSN value of $4.15B.
1.8B shares on issue gives us a share price of $2.30

Steini, you were looking for some numbers with potential valuation ? here you go?.all within the next 5 years. Also, I wonder what Sammy will be doing with all that profit each year? Adding to their acreage? Paying dividends? Buying businesses? Simply?.adding to the value of the business and thus share price even further.