Page 9 - Sun Resources Annual Report 2013

Oil to surface from laterals
in Upper, Middle and Lower
Woodbine in first “proof-of-
concept” drilling program
The successful $13.5m HPPL private placement
was a key success. However, the arrival of Petro-
Hunt LLC was another very important event for Sun.
On 12 June 2013, Sun entered into an agreement
with Petro-Hunt to jointly explore and develop
an Area of Mutual Interest (AMI) in northern Leon
County, Texas. Sun contributed 810 net acres from
the northern part of Delta Oil Project leases together
with Petro-Hunt’s contribution of 2,430 net acres in
the 7,832 acre AMI. The combined 3,240 net acres
will be owned (and drilled) by Petro-Hunt (75%) and
Sun (25%). Being the operator of the project and
Halcón Resources Corporation’s largest shareholder,
Petro-Hunt is aiming to drill the first horizontal well
into the Lower Woodbine (“Dexter” or Woodbine “C”)
interval in the fourth quarter of 2013. This delivers
both a new project area and a financially strong
and technically capable operator, which is another
excellent result for Sun. Should the first well lead to
a good commercial outcome, then Sun can expect
substantial further activity in the AMI area as the
project has excellent prospects.
So after a challenging first six months, I can look back
at important successes which may turn out to be the
catalyst for Sun’s growth into the next financial year.
With much strengthened operational groups, a re-
capitalisation, support from a new large and skilled major
shareholder and with better technical knowledge about
to be deployed across our oil projects, I am confident
that we have substantially addressed our immediate
problems. These efforts will hopefully translate into
improved results from the next few wells and release
some of the tremendous potential that I consider is latent
across Sun’s team and assets. The forward work plan
includes refinement of the ‘frac recipe’ in future wells and
possibly expanding in the play or into other related shale
oil plays.
I am looking forward to continuing to work closely
with the Board and management team of Sun, as
we prudently deploy our capital across our portfolio
and continue to refine our strategy. I wish to thank
shareholders for staying with us during a turbulent last
year and also offer my thanks to all the stakeholders
who have laid the foundations for Sun’s journey into
unconventional shale and tight oil plays. We look forward
to a successful year ahead.
Yours faithfully
Dr Govert van Ek
Managing Director
MANAGING DIRECTOR’S OVERVIEW 7