Samson Oil & Gas Limited (NYSE Amex, ASX: SSN) provided an operations update on its Williston Basin projects in Roosevelt County, Montana, and Williams County, North Dakota, as well as its Niobrara drilling projects in Goshen County, Wyoming.

Roosevelt County, Montana:

At the company’s Roosevelt project in Montana, SSN drilled the Australia II 12KA 6 well (100% working interest, subject to a 33.34% back-in option by Fort Peck Energy Company LLC) to a total measured depth of 14,972 feet. SSN reported encountering oil and gas shows across the entire length of the lateral (estimated at 4,700 feet). The company ran a 4 1/2-inch liner with 15 extender casing packers which were set in the 7-inch casing shoe. SSN started negotiations on securing a pressure pumping company to set a frac date for mid-February.

Based on the performance of nearby offsets, we do not expect the Montana Bakken wells to perform like those in the heart of the Bakken play (e.g., Williams County) where initial production (IP) rates of 2,000 BOPD and 3,000 BOPD are routine. The company suggests that IPs of 600 BOPD to 1,000 BOPD for Montana Bakken wells are economic and would be considered commercially successful. Follow the link above for the full report, and additional details on the economics of SSN’s Roosevelt County well program.

Goshen County, Wyoming:

At Hawk Springs, the pump on the Defender US33 #2-29H well (SSN 37.5% carried working interest) well (SSN was fully carried on this well) may have damaged valves that will need to be replaced in order to recover the remaining 60% of frac fluid.

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The Spirit of America US34 #1-29 well (SSN 100% working interest), also in Goshen county has been fracture stimulated into the J-sand formation and the company is continuing to monitor the reservoir quality over the next few weeks. No oil or formation fluids are being produced; only trace amounts of gas meaning the permeability of the reservoir may be too tight.

Bakken – North Stockyard Field – Williams County, North Dakota:

The Everett #1-15H well (SSN 26% working interest) in Williams County, North Dakota, is being fracture stimulated. Eleven of 20 planned stages have been completed; however, the 11th stage caused the sand in the well bore to be unable to flow back. Early in 2012, SSN will be contracting a coil tubing unit to complete the stimulation of the well. The well is Samson’s sixth Bakken well in the non-operated North Stockyard field.

OAG360 notes that production from the North Stockyard Field generates cash flow to cover fixed costs and preserve cash for executing the company’s exploration drilling program in Roosevelt County, Montana, and Goshen County, Wyoming. Upside from the Three Forks formation exists in the North Stockyard Field as well.


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