Current SSN Stock Info

Samson Foreman Butte Acquisition increases production 61%

Samson Oil & Gas (ticker: SSN) reported second quarter results today, posting a 61% increase in production from last quarter with the inclusion of production from their Foreman Butte acquisition. Production for the second quarter reached 18.2 MBOPD, according to the company’s press release.

Interest On April 1, Samson closed on the acquisition of 51,305 net acres of oil and gas leases, producing oil and gas wells, currently shut-in wells and associated facilities in North Dakota and Montana for a cash price of $16.0 million. Samson holds an 87% operated interest in the asset.

The 51,305 net acres of petroleum leases that were acquired include the right to exploit hydrocarbons down to the top of the Bakken Formation. For a portion of the leases, Samson is also acquiring the rights to the deeper geologic section below the Bakken pool.

The properties have been in production for several years and represent production from various geologic horizons above the Bakken Formation, including the Ratcliffe and Mission Canyon intervals of the Mississippian Madison Formation which provide conventional oil and gas accumulations in this region. The properties have largely been developed using 640 acre horizontal wells or 40 acre vertical wells. With the current lower oil service costs, Samson plans to development the acquired PUD locations by using longer laterals, infilling the historical 640 acre wells or developing 40 acre infills adjacent to existing or known production, the company said in its release.

Other highlights from the company’s second quarter included:

  • Samson’s G&A cash expenditure was reduced to $0.5 million for the second quarter from $1.3 million for the prior corresponding period in 2015.
  • Lifting cost per barrel (excluding workovers) continued to decline with the company’s current estimated cost estimate at $10 per barrel.
  • Oil price differentials in the Williston Basin improved from $8.00 per barrel 12 months ago to a current estimated differential of between $5.50 and $6.50 per barrel.
  • The closing cash balance for the quarter is $2.7 million.
  • $11.5 million debt facility reduction to be achieved through the sale of North Stockyard for $15 million, which is due to close on August 31st unless extended.

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