Samson Oil & Gas Limited (ASX: SSN; NYSE MKT: SSN):

TOTAL COMPANY PRODUCTION

Samson net production for 2014 is as follows:

                          Q1   Q2   Q3   October   November OIL, BO   29,408   50,553   35,576   6,016   17,619 GAS, MCF   48,518   50,928   46,710   12,086   9,363 BOE   37,494   59,041   43,361   8,030   19,180 BOEPD   416   656   481   260   639          

The North Stockyard field saw an increase in production for November as wells were returned to production. We are expecting that the field will be largely “on stream” in January 2015 as the infill development comes to a close. In-field operations has necessitated, for safety and operational reasons, existing wells to be shut in whilst this activity was undertaken.

With the completion of Ironbank 6 expected later this week, Frontier 24 will be laid down and no further drilling in the field is contemplated in light of the recent slide in the oil price. We are however anticipating that the existing inventory of 3 wells will be fracked, and the 5 wells that have been fracked will require a clean out. This means that 8 wells will be brought on line in the near term.

HEDGE BOOK

Samson has the following hedges in place:

              Calendar year   Volume bbls.   Floor   Ceiling 2014   1,672   $90.00   $99.30 2015   18,270   $85.00   $89.85 2016   2,788   $85.00   $89.85 Calendar year   Volume bbls.   Average per month   Swap 2014   4,588   4,488   $97.92 2015   39,791   3,316   $92.61      

As at December 15th, 2014 the book value of the hedge was $2.4 million as valued by Samson’s counterparty.

NORTH STOCKYARD PROJECT, WILLIAMS COUNTY, NORTH DAKOTA

The infill development plan for North Stockyard consists of 8 middle Bakken wells that have been drilled and 22 Three Forks wells of which 9 have been drilled (8 in the First Bench and 1 in the Second Bench). Given the infill development curtailment there will remain an undrilled balance of 13 wells. For ease of reference, the current status of each well is set out below with separate tables for each drill pad:

                          TOFTE 1 PAD  

Laterallength

  Objective   Status  

IP rateBOPD

 

Avg. RateBOPD#

 

Cum toDate BO

Billabong2-13-14HBK

  6,147 ft.   Bakken  

Frack scheduled for January

  NA   NA   NA

Sail and Anchor4-13-14HBK

  6,375 ft.   Bakken  

Shut in for frack program

  1,323   SI   54,978

Blackdog3-13-14 HBK

  8,383 ft.   Bakken  

Shut in for frack program

  1,995   SI   109,878                                      

 

 

Laterallength

  Objective   Status  

IP rateBOPD

 

Avg. RateBOPD#

 

Cum toDate BO

Tooheys4-15-14HBK

  6,740 ft.   Bakken   On production   1,078   340   62,805

Coopers2-15-14HBK

  6,360 ft.   Bakken   On Production   556   288   53,476

Little Creature3-15-14HBK

  7,578 ft.   Bakken   Shut in for frack program   501   SI   72,284                                      

MATILDA BAYPAD

 

Laterallength

  Objective   Status  

IP rateBOPD

 

Avg. RateBOPD#

 

Cum toDate BO

Matilda Bay2-15-HBK

  4,215 ft.   Bakken   On Production   1,117   110   29,159

Matilda Bay1-15-HBK

  4,215 ft.   Bakken   On Production   318   184   8,979                                       TF NORTH PAD  

Laterallength

  Objective   Status  

IP rateBOPD

 

Avg. RateBOPD#

 

Cum toDate BO

Bootleg4-14-15TFH

  7,211 ft.   Three Forks 1   On Production   NA   650   41,178

Bootleg5-14-15TFH

  7,495 ft.   Three Forks 1   On Production   NA   690   31,909

Ironbank4-14-13TFH

  7,466 ft.   Three Forks 1   Flowback commenced needs a CTU cleanout   NA   NA   NA

Ironbank5-14-13TFH

  7,495 ft.   Three Forks 1   Flowback commenced needs a CTU cleanout   NA   NA   NA                                       TF SOUTH PAD  

Laterallength

  Objective   Status  

IP rateBOPD

 

Avg. RateBOPD#

 

Cum toDate BO

Bootleg6-14-15TFH

  6,867 ft.   Three Forks 1   Frack completed   NA   NA   NA

Bootleg7-14-15TFH

  6,973 ft.   Three Forks 1   Frack completed   NA   NA   NA

Bootleg8-14-15TFH

  6,771 ft.   Three Forks 2   Frack completed   922   NA   922

Ironbank6-14-13TFH

  7,434 ft.   Three Forks 1   Drilling lateral at 18,464 ft.   NA   NA   NA

Ironbank7-14-13TFH

  7,458 ft.   Three Forks 1   Drilling completed   NA   NA   NA             #The Avg. Daily rate is an average of the last week’s production or the average after the well was put back into production. BO: Barrels of oil BOE: Barrels of oil equivalent (gas converted at its heating value) BOPD: Barrels of oil per day MCF: Thousand cubic feet BOEPD: Barrels of oil equivalent per day   NA: Not available APD: Application for Permit to Drill IP Rate: Gross first 24 hour oil rate Current rate BOPD: Barrels of Oil per Day Cum to Date: Cumulative gross BO  

Samson’s working interest and its net revenue interest for the North Stockyard Project is set out in the following table:

          Well   Working interest   Net revenue Interest Billabong 2-13-14HBK   28.77220%   22.01073% Sail and Anchor 4-13-14HBK   25.028509%   19.146809% Blackdog 3-13-14H   24.863526%   19.020597% Tooheys 4-15-14HBK   28.232033%   21.597505% Coopers 2-15-14HBK   28.232033%   21.597505% Little Creature 3-15-14H   27.759719%   21.236185% Matilda Bay 2-15-H   32.972255%   25.223775% Matilda Bay 1-15-H   32.972255%   25.223775% Bootleg 4-14-15TFH   28.386344%   21.715553% Bootleg 5-14-15TFH   28.386344%   21.715553% Ironbank 4-14-13TFH   26.746521%   20.461089% Ironbank 7-14-13TFH   26.746521%   20.461089% Bootleg 6-14-15TFH   28.386344%   21.715553% Bootleg 7-14-15TFH   28.386330%   21.715553% Bootleg 8-14-15H   28.386330%   21.715553% Ironbank 6-14-13TFH   26.746521%   20.461089% Ironbank 7-14-13TFH   26.746521%   20.461089%    

RAINBOW PROJECT, WILLIAMS COUNTY, NORTH DAKOTA

Gladys 1-20H (SSN 23%)

The Gladys 1-20 H well has been drilled by Continental Resources to a total depth of 19,994 feet. The well is a 1,280 acre lateral (approximately 10,000 feet) in the middle member of the Bakken Formation.

                             

Laterallength

  Objective   Status  

IP rateBOPD

 

Avg. RateBOPD#

 

Cum to DateBO

Gladys 1-20H   9,558 ft.   Middle Bakken   flowing   717   270   30,781            

HAWK SPRINGS PROJECT, GOSHEN COUNTY, WYOMING

BLUFF 1-11 (SSN 25%)

As previously reported the 9500 ft. sand was flow tested at 8 mmcfpd and then the well was shut-in for 10 day build-up using down hole gauges. Samson has a 25% interest in the Bluff well but owns a 52% of the entire Bluff prospect, the differential is due to Bluff being drilled with some partners who don’t lease in the whole project.

Gas Analysis

As expected the gas samples have returned a high concentration of nitrogen with some helium present and a small amount of hydrocarbons:

        Element     Chemical mol. % Nitrogen     97.58 Hydrocarbon     2.08 Helium     0.152 Carbon dioxide     0.17 Argon     0.012    

Reservoir Pressure

The buildup data has determined that the original reservoir pressure within the 9500 ft. sand is 3,459 psi. This data and that obtained from the water saturated 9500 ft. sand in the nearby SOA#2 well enables a column height calculation to be undertaken. The SOA#2 well provides an insight into the water gradient in the area and using that and the reservoir pressure in Bluff establishes a column height of approximately 1,400 feet, assuming that both the Bluff and SOA#2 are in the same hydraulic system. Whilst there are inherent inaccuracies in this calculation, the column height is consistent with the 1,400 feet of closure mapped within the stratigraphic trap, as determined by the amplitude anomaly.

Reservoir Parameters

The 9500 ft. sand returned an impressive flow rate and the buildup data has established a permeability of 330 md or a total of 5.3 darcy feet for the completed interval.

Pressure Transient Analysis

This analysis is complex and is still in a preliminary stage, but there are some early conclusions that can be reached:

1) There is an apparent fluid boundary within the total reservoir. The analysis can’t distinguish between that fluid boundary being oil or water, but given the column height calculated from a different data set, it would be logical for this fluid boundary to be oil rather than water.

2) The total reservoir volume represents a gas in place (GIP) of 35 BCF if the entire container was gas filled. This compares well with the volumetrics calculated from the 3D derived map which returned a GIP of 37 BCF. It is recognized that in both of these calculations, the gas can be replaced by a quantity of oil depending on the establishment of the nitrogen/oil contact.

3) One solution in the transient analysis suggests that the gas reservoir has a volume of 5.3 BCF and accordingly the balance of the reservoir volume would be occupied by oil and would be estimated at 20 million barrels of oil in place. Typical recovery factors are around 25% and thus 5 million barrels might be recovered in this scenario.

It should be emphasized that the discussion above represents our current understanding and should not be construed as an opinion as to a reserve estimate. This will come in due course, and will require the drilling of a down dip appraisal well to prove reservoir continuity and fluid content.

Forward Program

The data gathered thus far from the Bluff flow test has been very encouraging and we are pursuing several avenues to establish an investment case for down dip appraisal well:

1) Isotope analysis of the gas samples: this analysis will deliver an understanding as to the source of the gas, principally if it is inorganic or organic. The presence of hydrocarbons would suggest an organic source, however confirmation of this will allow the presence of an oil column to be theoretically possible.

2) Seismic attribute processing: the 3D seismic data is now able to be fine-tuned with the knowledge of the contained fluids at the Bluff and SOA#2 wells. This reprocessing may enhance the ability of the 3D data to distinguish between gas and a fluid, which in turn would lead to a better choice of a step-out location.

3) In the event that the entire Bluff prospect is filled with nitrogen it is possible that this gas can be commercialized. Very preliminary discussions with an industrial gas company would suggest that there is a market for this gas in the oil field service sector where it is used as a frack and cleanout fluid. Whilst liquid nitrogen is typically manufactured from the atmosphere this process requires the gas to be compressed from an atmospheric pressure of 14.7 psi and that process accounts for about 50% of the cost which would largely be avoided using the Bluff well head pressure. We understand that liquid nitrogen supplied to the energy sector is priced at around $20 per mcf. This final product pricing would suggest that there is a significant margin available for field produced nitrogen.

4) In the event that a cryogenic plant to produce liquefied nitrogen is economically feasible then that process would enable the small amount of helium to be extracted as adjunct to that process. We understand helium has a current market value of around $185 per mcf.

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 ADSs. Accordingly, based on the NYSE MKT closing price of US$0.20 per ADS on December 15th, 2014, the Company has a current market capitalization of approximately US$27.7 million (the options have been valued at an exchange rate of 0.8236). Correspondingly, based on the ASX closing price of A$0.012 for ordinary shares and a closing price of A$0.005 for the 2017 options, on December 15th, 2014, the Company has a current market capitalization of approximately A$34.9 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”, “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, CEO, 303-296-3994 (US office)970-389-5047 (US cell)