The 2P NPV is an estimate of the potential of AOK based on...

The 2P NPV is an estimate of the potential of AOK based on current estimated 2P reserves and assumes it is fully developed and derisked.

As AOK are only at the initial stage of their drilling program, the NPV of $158m needs to be discounted accordingly. The appropriate discount rate is very subjective and will be influenced and will change based on future flow rates and drilling success.

So eventhough AOK's market cap is currently less than $40m vs 2P NPV of $158m, it doesn't necessarily mean that we are definitely significantly undervalued based on todays announcement. A lot will depend on how successful our upcoming vertical wells are.

However, IMO, AOK has tremendous potential upside because of the 100+ potential vertical and 15 to 25 horizontal well locations in the Snake River Project in Oklahoma targeting the Mississippi Lime and the tremendous potential of our NW Kansas lease holdings which will also be targeting the same formation. Based on the track record of the other players in the Mississippi Lime to date, I personally believe that AOK is a medium risk, high return play which is why I continue to accumulate on any share price weakness.