Samson O&G Spotlights Production Boost in Williston Basin

Samson O&G updated its prior reports on the exceptional growth in oil production and reserves that it has achieved in the Williston Basin. Having just drilled its third Middle Bakken well (Gary #1-24H), which followed the previously drilled Leonard #1-23H, and Gene #1-22H wells, Samson announced that the next well in the sequence will be the Rodney #1-14H.

As a result of the drilling and fracture stimulation of this sequence of wells, Samson expects to be producing a net 6,000 barrels of oil equivalent a month as at December 2010. The projected December 2010 production rate is based on the data gathered from the Gene 1-22H well projected forward using conservative decline curve methodology. The projection assumes that the other wells making up the sequence perform like the Gene 1-22H well and are drilled and stimulated in a timely manner.

Gary #1-24H (37% working interest)

The Gary #1-24H well, located in Section 24, has reached a total depth of 17,727 feet measured depth, including a horizontal section of 5,647 feet. The well was drilled in the prolific middle member of the Mississippian Bakken Formation in the Williston Basin, using a design very similar to the one successfully implemented on the Gene #1-22H well.

While drilling the horizontal section, continuous oil and gas shows were recorded within the Middle Bakken Formation.

The forward plan is to run a 5 inch liner equipped with external casing packers that will allow 20 frac stages to be undertaken. The number of frac stages have been increased from the 15 stages utilized in the Gene #1-22H well based on experience in the area suggesting that the additional 5 stages will increase both the initial rate and the reserves associated with the well.

The frac date is expected to be either at the end of July or the third week of August.

Rodney #1-14H (27% working interest)

Samson has received a proposal to drill the Rodney #1-14H well, which would be its fourth Middle Bakken well. Both of the more successful Middle Bakken wells, the Gene 1-22H and the Gary 1-24H, will have been completed with high strength proppant and multiple stage fracs. This completion protocol showed considerable improvement in the Gene 1-22H from the Leonard #1-23H, which was Samson's first Bakken well in the field, and similarly positive results are expected when the Gary 1-24H is completed.

The spud date for the Rodney 1-14H well has not yet been set but it is anticipated that drilling will begin sometime in August of this year.

Gene #1-22H (30.6% working interest)

After being on-line for two months, the Gene #1-22H well has met Samson's pre-drill expectations. Cumulative production for the first two months is 33,470 bbls of oil and 40,000 Mscf of gas. The well is still flowing naturally and has a higher potential than the current rate of approximately 400 BOPD. It is typical for unconventional reservoirs like the Gene 1-22H to have a steep initial decline, so the Gene well is behaving as expected.

Sometime in the next several months, however, after the flowing tubing pressure and flow rate reduces to low rate, the rod pump will be run in the hole to commence artificial lift. At this time, the oil and gas flow rate would be expected to increase substantially due to the lower flowing bottom-hole pressure.