Exhibit 99.1
 | QUARTERLY REPORT for the period ended 31 March 2019 |
FINANCIAL HIGHLIGHTS
| - | Average net production for the quarter ended 31 March 2019 was 524 barrels of oil equivalent per day, down 28% from the quarter ended 31 December 2018 of 726 barrels of oil equivalent per day (production numbers are based on barrels sold and doesn’t include movements in oil tank inventory). |
| - | Current 30 day production rate (as at April 2019), is averaging 822 BOPD (on a gross Operated basis) and approximately 598 BODP net to Samson. This increase from March quarter is due to weather improvements which brought wells, previously shut in due to weather conditions, back on line. |
Prior 12 month production by quarter:
| | | Q2 2018 | | | Q3 2018 | | | Q4 2018 | | | Q1 2019 | |
| OIL, BO | | | 47,097 | | | | 54,779 | | | | 63,618 | | | | 46,258 | |
| GAS, MCF | | | 7,046 | | | | 11,941 | | | | 10,583 | | | | 5,213 | |
| BOE | | | 48,271 | | | | 56,769 | | | | 65,381 | | | | 47,157 | |
| BOEPD | | | 536 | | | | 631 | | | | 726 | | | | 524 | |
Estimated net production and revenue:
| | | OIL Bbls | | | OIL US$ | | | GAS Mscf | | | GAS US$ | | | TOTAL US$ | |
| March 2019 Quarter | | | 46,258 | | | | 2,246,288 | | | | 5,213 | | | | 16,368 | | | | 2,262,656 | |
| December 2018 Quarter | | | 63,618 | | | | 2,846,027 | | | | 10,583 | | | | 50,952 | | | | 2,896,979 | |
Average commodity prices:
| | | OIL US$/Bbl | | | GAS S$/Mscf | | | | | | | | | | |
| March 2019 Quarter | | $ | 48.56 | | | $ | 3.14 | | | | | | | | | | | | | |
| December 2018 Quarter | | $ | 44.73 | | | $ | 4.85 | | | | | | | | | | | | | |
In some cases, revenue is yet to be received and is therefore an estimate.
The differential (the difference between WTI and local pricing) for Williston Basin crude are set monthly by our marketer and are generally around $4 per barrel, the differential for the March 2019 quarter averaged $6.25.
IN FILL DEVELOPMENT
As a consequence of the recent refinancing, the Company has embarked on an infill development program . This program is expected to commence in late April 2019, with the drilling of the first Gonzales Proved Undeveloped (PUD) location. The drilling program is designed to drill two horizontal laterals from the existing Gonzales #1-8H well bore. This well has a 5 ½ inch casing set horizontally at 9,711ft. MD within the objective Ratcliffe Formation. The existing development consists of a single 5,300ft. lateral with a single 640 acre spacing unit. The two new well bores will be directionally drilled to access the balance of the 640 acre spacing unit.
The initial two laterals at the Gonzales location will be drilled by PowerDrill’s rig #101. Samson has run an inflatable packer to a depth of 10,411ft. (measured depth) and will commence injection of produced water in 24 hours, after the packer has time to inflate. This water injection is aimed at establishing additional reservoir pressure that will aid the directional drilling operation.
The ability to drill out of an existing wellbore has made the economics of these development wells extremely attractive, with an estimated drilling cost around $0.5 million and the resulting ability to use existing surface facilities associated with the existing well.
Samson Oil & Gas Limited Level 16, AMP Building, 140 St Georges Terrace, Perth WA 6000 T: +618 9220 9830F: +618 9220 9820ABN: 25 009 069 005ASX: SSN | Samson Oil & Gas USA 1131, 17th Street, Suite 710, Denver Colorado 80202 T: +1 303 295 0344F: +1 303 295 1961 |
SAMSON OIL & GAS LIMITED
March 2019 Quarterly Report
The estimated net present value of each lateral is $1.2 million, representing a rate of return of 340%. The recent appreciation in the price of crude has added considerable value to this and future drilling opportunities.
The next 12 months will see a total of 8 similar lateral wells to the Gonzales wells drilled within the Home Run Field, which is the largest (by area) of the oil fields in Samson’s portfolio. Samson has the ability to dispose of the produced water within a pressure maintenance facility that it owns in the adjacent Mays well, minimizing one of the significant costs of production. Samson has in its portfolio a total of 26 PUD locations that will provide an excellent growth platform. The debt funding that has been achieved in this transaction will provide sufficient working capital to initiate and maintain the planned development drilling program.
LAND
| PROJECT | | BASIN | | STATE | | COUNTY | | NET ACRES |
| Hawk Springs | | DJ | | Wyoming | | Goshen | | 40 |
| Roosevelt | | Williston | | Montana | | Roosevelt | | 2,230 |
| Rainbow | | Williston | | North Dakota | | Williams | | 294 |
| Foreman Butte | | Williston | | North Dakota/Montana | | Numerous | | 51,305 |
PROJECTS
Rainbow Field: Williams County, North Dakota
Mississippian Bakken Formation, Williston Basin
Gladys 1-20H
Samson 23% Working Interest
Kraken Operating, LLC, the operator of the Gladys 1-20H well, has been producing this well at an average rate of BOPD and MCFPD during the quarter. There are 6 additional Bakken/Three Forks drilling locations on this 1280 acre lease.
Foreman Butte Project: McKenzie & Williams Counties, North Dakota and Richland, Roosevelt, Sheridan Counties, Montana
Mississippian Madison Formation, Williston Basin
Samson 87% Operated Average Working Interest
The previously announced sale transaction for this project did not close as expected on 15 October 2018 and that contract was terminated. The infill drill project detailed in the earlier part of this report has commenced.
LIQUIDITY
Sources of cash for the next quarter are as follows:
| | | US$(’000’s) | |
| Current cash on hand | | | 953 | |
| Cash receipts from December quarter oil and gas sales* | | | 836 | |
| TOTAL | | | 1,789 | |
* Estimate based on realized March quarter production and $52.94 oil price (indicative of estimated oil pricing), allowing for a one month delay between production and cash receipt.
FINANCIAL
On April 9, Samson Oil and Gas, USA, Inc., a wholly owned subsidiary of Samson oil and Gas Limited closed a $33.5 million refinancing with AEP I FINCO LLC. The new facility has a 5 year term and an interest rate of LIBOR + 10.5%. The proceeds of the new debt facility will be used to retire the existing line of credit, repay outstanding creditors and to provide working capital to pursue an infill drilling program.
SAMSON OIL & GAS LIMITED
March 2019 Quarterly Report
Foreign Exchange Rates
The closing A$:US$ exchange rate on 31 March 2019 was $0.71 The average A$:US$ exchange rate for the quarter was $0.71.
The Company’s cash position at 31 March 2019 was as follows:
| | | US$(‘000’s) | |
| Cash at bank on deposit | | | 953 | |
As a result of the refinancing, Samson’s financial condition and liquidity has improved, and Samson will now commence the process of relisting on the ASX.
Hedging
Samson has entered into a series of hedges for 767,084 bbl of crude oil production for the next four years at an average price of $55.45/bbl and for 240,000 MMcf of natural gas costless collars with a weighted average put at $2.53 per MMBTU and a weighted average of call of $2.77 per MMBTU. A price point between the out and then call no settlement is due.
At a current oil price of $66.32 the mark to market value for the oil swaps is a negative $.8.3 million and the gas cost less collars have a positive value of $30,000.
For and on behalf of the Board of
SAMSON OIL & GAS LIMITED
Information contained in this report relating to hydrocarbon reserves was compiled by the Managing Director of Samson Oil & Gas Ltd., T M Barr a Geologist who holds an Associateship in Applied Geology and is a fellow of the Australian Institute of Mining and Metallurgy who has 30 years relevant experience in the oil & gas industry. |
TERRY BARR
Managing Director
2 May 2019
SAMSON OIL & GAS LIMITED
March 2019 Quarterly Report
Rule 5.3
Appendix 5B
Mining exploration entity and oil and gas exploration entity quarterly report
Introduced 01/07/96 Origin Appendix 8 Amended 01/07/97, 01/07/98, 30/09/01, 01/06/10, 17/12/10, 01/05/13, 01/09/16
| Name of entity |
| Samson Oil and Gas Limited |
| ABN | | Quarter ended (“current quarter”) |
| 25 009 069 005 | | 31 March 2019 |
| Consolidated statement of cash flows | | Current quarter
$US’000 | | | Year to date
(9 months)
$US’000 | |
| 1. | Cash flows from operating activities | | | | | | |
| 1.1 | Receipts from customers | | | 2,871 | | | | 11,558 | |
| 1.2 | Payments for | | | | | | | (48 | ) |
| | (a) exploration & evaluation | | | (9 | ) | | | | |
| | (b) development | | | (86 | ) | | | (343 | ) |
| | (c) production | | | (2,425 | ) | | | (8,029 | ) |
| | (d) staff costs | | | (219 | ) | | | (763 | ) |
| | (e) administration and corporate costs | | | (566 | ) | | | (1,590 | ) |
| 1.3 | Dividends received (see note 3) | | | | | | | | |
| 1.4 | Interest received | | | | | | | | |
| 1.5 | Interest and other costs of finance paid | | | (395 | ) | | | (1,151 | ) |
| 1.6 | Income taxes paid | | | | | | | | |
| 1.7 | Research and development refunds | | | | | | | | |
| 1.8 | Other (provide details if material) Hedging | | | | | | | | |
| | Abandonment costs | | | 0 | | | | (775 | ) |
| 1.9 | Net cash from / (used in) operating activities | | | (829 | ) | | | (1,141 | ) |
| | | | | | | | | | |
| 2. | Cash flows from investing activities | | | | | | | | |
| 2.1 | Payments to acquire: | | | | | | | | |
| | (a) property, plant and equipment | | | - | | | | - | |
| | (b) tenements (see item 10) | | | - | | | | - | |
| | (c) investments | | | - | | | | - | |
| | (d) other non-current assets | | | - | | | | - | |
SAMSON OIL & GAS LIMITED
March 2019 Quarterly Report
| Consolidated statement of cash flows | | Current quarter
$US’000 | | | Year to date
(9 months)
$US’000 | |
| 2.2 | Proceeds from the disposal of: | | | | | | | | |
| | (a) property, plant and equipment | | | - | | | | 700 | |
| | (b) tenements (see item 10) | | | - | | | | - | |
| | (c) investments | | | - | | | | - | |
| | (d) other non-current assets | | | - | | | | - | |
| 2.3 | Cash flows from loans to other entities | | | - | | | | - | |
| 2.4 | Dividends received (see note 3) | | | - | | | | - | |
| 2.5 | Other (provide details if material) | | | - | | | | | |
| 2.6 | Net cash from / (used in) investing activities | | | - | | | | 700 | |
| 3. | Cash flows from financing activities | | | - | | | | - | |
| 3.1 | Proceeds from issues of shares | | | | | | | | |
| 3.2 | Proceeds from issue of convertible notes | | | - | | | | - | |
| 3.3 | Proceeds from exercise of share options | | | - | | | | - | |
| 3.4 | Transaction costs related to issues of shares, convertible notes or options | | | - | | | | - | |
| 3.5 | Proceeds from borrowings | | | - | | | | - | |
| 3.6 | Repayment of borrowings | | | - | | | | - | |
| 3.7 | Transaction costs related to loans and borrowings | | | - | | | | - | |
| 3.8 | Dividends paid | | | - | | | | - | |
| 3.9 | Other (provide details if material) | | | - | | | | - | |
| 3.10 | Net cash from / (used in) financing activities | | | - | | | | - | |
| | | | | | | | | | |
| 4. | Net increase / (decrease) in cash and cash equivalents for the period | | | | | | | | |
| 4.1 | Cash and cash equivalents at beginning of period | | | 1,757 | | | | 1,376 | |
| 4.2 | Net cash from / (used in) operating activities (item 1.9 above) | | | (829 | ) | | | (1,141 | ) |
| 4.3 | Net cash from / (used in) investing activities (item 2.6 above) | | | - | | | | 700 | |
| 4.4 | Net cash from / (used in) financing activities (item 3.10 above) | | | - | | | | - | |
SAMSON OIL & GAS LIMITED
March 2019 Quarterly Report
| Consolidated statement of cash flows | | Current quarter
$US’000 | | | Year to date
(9 months)
$US’000 | |
| 4.5 | Effect of movement in exchange rates on cash held | | | 25 | | | | 18 | |
| 4.6 | Cash and cash equivalents at end of period | | | 953 | | | | 953 | |
| 5. | Reconciliation of cash and cash equivalents
at the end of the quarter (as shown in the consolidated statement of cash flows) to the related items in the accounts | | Current quarter
$US’000 | | | Previous quarter
$US’000 | |
| 5.1 | Bank balances | | | 953 | | | | 1,757 | |
| 5.2 | Call deposits | | | - | | | | - | |
| 5.3 | Bank overdrafts | | | - | | | | - | |
| 5.4 | Other (provide details) | | | - | | | | - | |
| 5.5 | Cash and cash equivalents at end of quarter (should equal item 4.6 above) | | | 953 | | | | 1,757 | |
| 6. | Payments to directors of the entity and their associates | | | | | Current quarter
$US'000 | |
| 6.1 | Aggregate amount of payments to these parties included in item 1.2 | | | | | | | 140 | |
| 6.2 | Aggregate amount of cash flow from loans to these parties included in item 2.3 | | | | - | |
| 6.3 | Include below any explanation necessary to understand the transactions included in items 6.1 and 6.2 | | | | | |
Salary and Directors Fees
| 7. | Payments to related entities of the entity and their associates | | | | | Current quarter
$US'000 | |
| 7.1 | Aggregate amount of payments to these parties included in item 1.2 | | | | | | | - | |
| 7.2 | Aggregate amount of cash flow from loans to these parties included in item 2.3 | | | | - | |
| 7.3 | Include below any explanation necessary to understand the transactions included in items 7.1 and 7.2 | | | | | |
SAMSON OIL & GAS LIMITED
March 2019 Quarterly Report
8.
| Financing facilities available
Add notes as necessary for an understanding of the position | | Total facility
amount at quarter end
$US’000 | | | Amount drawn at
quarter end
$US’000 | |
| 8.1 | Loan facilities | | | 24,000 | | | | 23,902 | |
| 8.2 | Credit standby arrangements | | | - | | | | - | |
| 8.3 | Other (please specify) | | | - | | | | - | |
| 8.4 | Include below a description of each facility above, including the lender, interest rate and whether it is secured or unsecured. If any additional facilities have been entered into or are proposed to be entered into after quarter end, include details of those facilities as well. | | | | | | | | |
Mutual of Omaha Bank credit facility - $23.9m. The interest rate is 5.25% on the reserve based lending facility and the interest rate is 6.5% on the term loan with a balance of $4.0 million. Both loans matured October 2018 and were fully secured against Samson’s oil and gas assets. The facility was refinanced in April 2019.
| 9. | Estimated cash outflows for next quarter | | $US’000 | |
| 9.1 | Exploration and evaluation | | | - | |
| 9.2 | Development | | | 1,000 | |
| 9.3 | Production | | | 1,500 | |
| 9.4 | Staff costs | | | 450 | |
| 9.5 | Administration and corporate costs | | | 600 | |
| 9.6 | Other (provide details if material) | | | - | |
| 9.7 | Total estimated cash outflows | | | 3,550 | |
10.
| Changes in tenements
(items 2.1(b) and 2.2(b) above) | | Tenement reference and location | | Nature of interest | | Interest at beginning of quarter | | Interest at end of quarter |
| 10.1 | Interests in mining tenements and petroleum tenements lapsed, relinquished or reduced | | | | | | | | |
| 10.2 | Interests in mining tenements and petroleum tenements acquired or increased | | | | | | | | |
SAMSON OIL & GAS LIMITED
March 2019 Quarterly Report
Compliance statement
| 1 | This statement has been prepared in accordance with accounting standards and policies which comply with Listing Rule 19.11A. |
| 2 | This statement gives a true and fair view of the matters disclosed. |
| Sign here: |  | | Date: 2 May 2019 |
| | (Director/Company secretary) | | |
| | | | |
| Print name: | DENIS RAKICH | | |
Notes
| 1. | The quarterly report provides a basis for informing the market how the entity’s activities have been financed for the past quarter and the effect on its cash position. An entity that wishes to disclose additional information is encouraged to do so, in a note or notes included in or attached to this report. |
| 2. | If this quarterly report has been prepared in accordance with Australian Accounting Standards, the definitions in, and provisions of, AASB 6: Exploration for and Evaluation of Mineral Resources and AASB 107: Statement of Cash Flows apply to this report. If this quarterly report has been prepared in accordance with other accounting standards agreed by ASX pursuant to Listing Rule 19.11A, the corresponding equivalent standards apply to this report. |
| 3. | Dividends received may be classified either as cash flows from operating activities or cash flows from investing activities, depending on the accounting policy of the entity. |
