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FINANCIAL HIGHLIGHTS – The company’s debt facility was increased to US$19 million and the interest rate reduced to a 90 day LIBOR plus 3.25%, currently the effective rate is approximately 3.48%. During the quarter, Samson drew down US$4.5 million against this facility, with a further drawdown of US$2.0 million in January 2015, bringing the outstanding loan balance to US$17.5 million. Given the curtailment of the North Stockyard drilling program, no further drawdowns are planned. – Samson has curtailed its development drilling program in the North Stockyard field after the completion of the Ironbank 6 well. The Frontier 24 rig was laid down without contractual penalty. – The Company’s G&A cost was reduced by 43% from US$3.3 million expensed for the six months to 31 December 2013, to US$2.3 million for the corresponding period in 2014. Further reductions in this expense are expected to be finalized in the first quarter of 2015 in response to the recent slide in the oil price. – Estimated oil and gas revenue was US$2.7 million for the quarter (there is generally a two to three month delay between production and the receipt of funds). – Lease operating, exploration, valuation of derivatives and administration expense for the quarter was US$0.3 million. – A net US$8.8 million was spent on development during the quarter, related to Samson’s share of the North Stockyard project drilling program. – The closing cash balance for the quarter was US$3.8 million. – During the quarter 36,600 barrels for 2016 production were added to the company’s hedge book. The total volume currently hedged is 97,449 barrels for 2015 and 2016 and is valued at US$2.6 million as at 26 January 2015.

OPERATIONAL HIGHLIGHTS – The North Stockyard field is being developed from several drill pads on which multiple wells are located. As the program is one of infill drilling both between and beneath existing well bores, a large part of the field was shut in during the December quarter to allow this activity to occur. The pad drilling and the intertwining well bores provides two operational issues: one is that it would be unsafe to be drilling on a pad that contained a flowing well bore in close proximity, and accordingly that producing well is shut in while those pad operations are underway; second, where a well is being fracked in close proximity to an existing well bore, industry practice is to remove the pump and plug the well temporarily such that the pressure pulse seen from conducting the adjacent fracture stimulation does not push proppant (“frack sand”) into that well bore and damage the completion. – As a result of these operational constraints, during the quarter only 820 “well days” of the available 2,208 “well days” were on production during the quarter. – Given that the drilling program has been curtailed, the North Stockyard field is being returned to full production, and, as of this report date, 11 wells are on stream. The remaining 13 wells are expected to be back on line by the end of February. – The Gladys well, which has been on free flow for four months, has had an electrical submersible pump (ESP) installed and the well has responded with two days of daily oil production exceeding 950 BOPD. While this is early in terms of establishing a stable production rate, the initial production rate from this ESP configuration is very encouraging. Gladys has produced 34,721 BBLs on free flow and was a modest producer – however the installation of the ESP may change that perception based on the early response of the well to artificial lift.

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