we r still healthy alive kicking and screaming

Hi,

Let us recap what we got:

Cash as at March 2012 = $31M (will be approx $25M as at End June 2012).

Daily Oil Production - Approx 260 Barrels
Daily Gas Production - Approx 650 MCF

Even at today's rates, these generate approx $22K per day
and this is sufficient to pay wages and production costs ie we are not going backwards.

We still have sureshot 6 production locations in North Stockyard and 12 underlying Three Fork locations.

By spending $15M on 6 Bakken locations at North Stockyard, we can increase daily oil production to approx 550 to 600 barrels and company will become cash flow positive to the tune of approx $2M per quarter.

Then we have

Three Horizontal and one vertical well under evaluation. At worst the money has been sunk and whatever we get will be pure bonus and will add to our cash flow. However, I believe SOA 2 will surprise most.

We are far from dead and are in fact better than I would say 90% of oilers listed on the ASX.


I ask the question - Why is market treating us so harsh!!

The following sums up my reasoning:

- The overall market sentisent is bad and people are protecting their profits/capital by taking money out of the market.

- The promise of a hanging fruit by SSN is being extended again and again.

- The ill conceived LTIP eroded all the faith in management

- The reporting style needs a lot to be desired. The management must provide reports in layman's terms and back it up with technical data like seismic data, porosity, permeability, saturation etc. Hiding technical details under the cover of confidentiality clause raises suspicions specially when the track record (read Defender confidentiality) is no good. People will assume (as in case of SOA 2) the worst result unless shown otherwise.

- The shareholders are afraid that current management is only seeking glory from geoligical perspective and not paying enough commercial attention. We may run out of funds and need more capital raisings. We need a clear laid out strategy showing how company will manage acreage and cash flow.