Samson Oil & Gas Limited (NYSE MKT: SSN) announced today
that its Board of Directors had approved a change in the number of
its ordinary shares represented by American Depositary Shares,
issued by the Bank of New York Mellon as depositary, from 20
ordinary shares per ADS to 200 ordinary shares per ADS. The change
in exchange ratio for the ADSs will have the same effect as a
1-for-10 reverse stock split of the ADSs, reducing the number of
outstanding ADSs from 102,900,833 to approximately 10,290,000 ADSs.
The ADSs will continue to trade on the NYSE MKT. Samson’s ordinary
shares, which are not affected by the change, will continue to
trade on the ASX.
The new ADS to ordinary share ratio of 1 for 200 will be
effective prior to the commencement of trading on the NYSE MKT on
Monday, March 30th, 2015. Because each ADS will represent ten times
the number of Samson’s ordinary shares after the ratio change, and
the total number of ordinary shares remains the same, the trading
price of the ADSs is expected to increase by the same multiple,
enhancing the suitability of the ADSs for auction trading on the
NYSE MKT.
Holders of Samson’s ordinary shares, which are traded on the
Australian Securities Exchange (ASX: SSN), are entirely unaffected
by the new exchange ratio for ADSs. Approximately 70% of Samson’s
outstanding equity is currently represented by ADSs, with the
balance held directly as ordinary shares.
No fractional ADSs will be issued. Holders who would otherwise
receive fractional ADSs will receive a cash payment in lieu of such
fractional ADS. The cash in lieu rate will be set when the
depositary sells the ADSs that would otherwise have been issued as
fractional ADSs in one or more market trades.
ADS holders with ADSs held in book-entry form or through a bank,
broker or other nominee are not required to take any action and
will see the impact of the change to the ADS ratio reflected in
their accounts after March 30th, 2015. Beneficial holders may
contact their bank, broker or nominee for more information. ADS
holders with ADSs held in certificate form may exchange their
certificates for book-entry ADSs resulting from the changed ADS
ratio. Shortly after March 30th, 2015, such ADS holders will
receive a Letter of Transmittal and instructions for exchanging
their certificates from the depositary.
ABOUT SAMSON
Samson is an oil and gas producer and in February 2015 averaged
845 BOEPD from its producing properties largely in North
Dakota.
Samson has a proven reserve of between 1.9 and 2.4 million BOEs
valued at between $39 and $67 million, as determined by Ryder Scott
Company as at December 31st, 2014 as follows:
SEC Pricing Producing
Non-Producing
Undeveloped Total Proved
NPV 10millions
Oil 645.8 809.8 576.7
2,032.3 Plant products
1.5 0 0 1.5
Gas 878.1 761.7
557.3 2,197.1 BOE
793.7 936.8 669.6
2400.0 $67.575
SEC pricing
Oil $94.99 Plant Products
$44.84 Gas $4.37
NYMEXPricing
Producing
Non-Producing
Undeveloped Total Proved
NPV 10millions
Oil 614.3.0 783.5 224.0
1,621.8 Plant products
0.7 0 0 0.7
Gas 825.0 737.1
212.7 1,774.8 BOE
751.9 906.4 259.5
1917.8 $39.442
NYMEX pricing as at December 31st, 2014 was:
2015 2016 2017
2018 2019 2020
2021thereafter
Oil 56.01 62.63 66.55
68.50 69.75 70.52
70.61 Plant Products 30.85 29.63
28.92 28.45 28.19
28.18 28.18 Gas 3.00
3.46 3.76 3.96
4.12 4.21 4.15
Oil is as delivered at Cushing, plant products at Mont Belvieu,
and gas at Henry Hub and adjusted for local differentials.
In January 2014, Samson entered into a reserve based lending
facility with a 3 year term and an interest rate of 3.25% plus
LIBOR. This facility is currently drawn down to $19 million. As at
December 31 Samson had a cash balance of $3.9 million.
Samson is pursuing two additional projects that it believes to
be economic even at current oil prices, namely development of the
down dip oil in the Bluff prospect and of the Hawks Springs project
generally, as well as an opportunity identified in a new basin.
The Bluff 1-11X well proved an excellent Permian aged reservoir
along with trap integrity; however, the flow test produced 94%
nitrogen. Whilst an unusual gas composition, gas caps are quite
normal for oil fields and based on various technical analyses,
Samson believes it is likely that an oil leg lies down dip that was
not penetrated by the initial well. It is expected that the Bluff 2
well will be drilled this summer around 270 feet down dip of
Bluff1-11X to investigate the fluid content of the reservoir. Using
a sophisticated simulator, Samson currently projects a well in the
Bluff oil leg to recover 550,000 barrels and have a NPV10 of $8.3
million using a flat $50 oil price. Samson holds a working interest
of 51% and a net revenue interest of 42% in the Bluff Prospect
Samson is also pursuing an exploration opportunity in a new
basin where it has an executed option for 8,000 acres from a State
institution that requires a third party agreement to issue a 5 year
lease. This third party has an existing mineral lease outside of
the energy mineral suite that requires a mutual mineral development
agreement such that both the oil and gas can be exploited by Samson
along with an existing non energy mineral. Samson is confident that
such an agreement can be settled based on the very cooperative
negotiations undertaken thus far. The viability of the project is
demonstrated by the immediately adjacent production illustrating
the potential flow capacity and economics of the project.
Samson’s Ordinary Shares are traded on the Australian Securities
Exchange under the symbol "SSN." Samson's American Depository
Shares (ADSs) are traded on the New York Stock Exchange MKT under
the symbol "SSN." Each ADS represents 20 fully paid Ordinary Shares
of Samson. Samson has a total of 2,837 million ordinary shares
issued and outstanding (including 230 million options exercisable
at AUD 3.8 cents), which would be the equivalent of 141.85 million
DSs. Accordingly, based on the NYSE MKT closing price of US$0.19
per ADS on March 19th, 2015, the Company has a current market
capitalization of approximately US$27.9 million (the options have
been valued at an exchange rate of 0.7732). Correspondingly, based
on the ASX closing price of A$0.012 for ordinary shares and a
closing price of A$0.002 for the 2017 options, on March 19th, 2015,
the Company has a current market capitalization of approximately
A$34.5 million.
SAMSON OIL & GAS LIMITED
TERRY BARRManaging Director
Statements made in this press release that are not historical
facts may be forward looking statements, including but not limited
to statements using words like “may,” “believe,” “expect,”
“project,” “anticipate,” “should” or “will.” Actual results may
differ materially from those projected in any forward-looking
statement. There are a number of important factors that could cause
actual results to differ materially from those anticipated or
estimated by any forward looking information, including
uncertainties inherent in estimating the methods, timing and
results of exploration activities. A description of the risks and
uncertainties that are generally attendant to Samson and its
industry, as well as other factors that could affect Samson’s
financial results, are included in the prospectus and prospectus
supplement for its recent Rights Offering as well as the Company's
report to the U.S. Securities and Exchange Commission on Form 10-K,
which are available at
www.sec.gov/edgar/searchedgar/webusers.htm.
Samson Oil & Gas LimitedTerry Barr, 303-296-3994 (US
office) or 970-389-5047 (US cell)CEO