Flow Back Ops Continue at Samson's Hawk Springs Proj.

Samson O&G advised that flow back operations are continuing, with 29% of the frac fluid being recovered. The well has not produced any formation fluids to date and therefore no rate has been established. The lack of hydrocarbons at this stage of the flow back may be due to the existing pressure regime. As expected pre-drill, the Niobrara Formation is "normally pressured" and because the frac fluid in the wellbore is a 5% sodium chloride solution, it exerts a pressure on the formation that exceeds the formation pressure, thus inhibiting the reservoir fluids flow.

This pressure in-balance will be overcome by installing a pump and reducing the fluid column (and therefore the pressure) in the well bore. This is planned next week when tubing and a down-hole pump will be installed.

The Defender US33 #2-29H is the first Niobrara appraisal well in Samson's Hawk Springs project.


AUSTRALIA II 12KA 6 #1-29, (SSN 100%, subject to a 33.34% back-in option)

Drilling operations continue on the Australia II 12 KA 6 #1-29, which is at a depth of 9,414 feet, the core point for the Bakken Formation. One 60 foot core will be taken in the Bakken Formation and a second 60 foot core will be taken in the Upper Three Forks Formation. Following coring operations, electric logs will be run and the well will then be plugged back so the 4,500 foot lateral can be drilled.