New Fluid Solutions, Inc. NFS-BlackSeal ®

Overview Generally, the types of formations that are prone to lost returns are cavernous and vugular, naturally occurring or induced fractures, unconsolidated sands, highly permeable and highly depleted tight sands. Well known lost circulation control techniques such as bridging, gelling, and cementing are typically used, with varying degrees of success. These remedies can sometimes complicate problems associated with lost returns. NFS-BlackSeal ®

Continue Overview Attempts to cure lost circulation can be difficult and costly, especially when considering the associated non-productive time. Lost circulation problems related to drilling through depleted sands are compounded by the low fracture gradient in the sands and the high mud weight required to minimize compressive failure in adjacent shales.

NFS-BlackSeal ® is a graphite based blend of several resilient materials including fibers, minerals, and polymers designed to help reduce or eliminate seepage losses during the drilling of a depleted zone. NFS-BlackSeal ® is temperature stable up to 450  F and disperses in synthetic and aqueous-base fluids. This product can be mixed in all types of drilling and completion fluids. Additions of up to 30 pounds per barrel of this unique product will not increase ECD, thus helping to reduce or eliminate losses. This process can cure losses instantly, without time or temperature dependency.

NFS-BlackSeal ® Advantages: Prevent and control seepage/total losses Provides lubricity One sack blend Easy mixing through the mud hopper Water and oil dispersible, so it can be used in a broad range of fluid applications Total resiliency Benefits: Mixes in all types of fluids Environmentally acceptable (complies with LC 50 requirement) Contaminant friendly Temperature stable up to 450  F

Preparation NFS-BlackSeal ® can be mixed in water, diesel or directly into the mud system. Note: NFS-BlackSeal ® can be mixed in water for density of up to 17.0 ppg. for higher density add NFS-BlackSeal ® to diesel or directly into the mud system.

NFS-BlackSeal ® Preparation: Pre-treat system with 3-5lbs/bbl. If seepage loss occurs, mix lbs/bbl of NFS-BlackSeal ® in a pill tank and sweep the hole. For seepage losses greater than 30 bbl/hr, mix lbs/bbl of the NFS-BlackSeal ® and sweep the hole. Losses greater than 30 bbl/hour: In a clean mixing tank prepare 50 barrels or (desired volume) of fresh water, sea water, or diesel, then mix 160 bags of NFS-BlackSeal ® for every 50 barrels pill, through the mud hopper and mix for minutes. If weighted pill is needed add Barite directly to the slurry for desired density. Placement Determine the loss zone of possible. Pump the NFS-BlackSeal ® slurry through the drill string, clear the pipe and the drill bit. Do not over displace. Pull 90’ of pipe or pull into the last casing and close the hydrill. Perform a 300 to 800 PSI squeeze and hold pressure for minutes. Open the hydrill wait 3 to 4 hours, trip back to the last bit position. Break circulation slowly with slow pump rate then resume drilling operation. Packaged in 25 lb bags or 2000 lb super sacks.

NFS-BlackSeal ® Filter Cake

NFS-BlackSeal ® Core testing of the Seal PSI

NFS-BlackSeal ® Example 11,000’ wells in Hidalgo County, South Texas

NFS-BlackSeal™ Mastersizer 2000 Ver Malvern Instruments NFS-BlackSeal ®

Results NFS-BlackSeal ® is the only effective alternative to the expensive and non-productive conventional lost circulation material. NFS-BlackSeal ® has been field tested successfully in over 100 wells. In both water and invert fluid systems.

Case Histories Operator South Texas: 610′ 6 1/2″ hole Hidalgo County, Texas 16.4 ppg OBM had pumped two 60 bbl of competitors product pills previous. As well as two cement plugs with no success. Pumped 36 bbls of NFS-BlackSeal ® (MIXED IN the shoe 7 bbls into the operation regained full returns. Continued pumping the rest of the pill, and held 500 PSI. Drilling resumed with full circulation. South Texas Operator: Pumped 90 bbls (Mixed in diesel) of NFS-BlackSeal ® and pulled above to squeeze, and circulated with minimal losses above the pill. Squeezed the material and would not hold pressure. Mixed another 55 bbl pill and re-squeezed, which held 600 PSI of pressure. Run on top of the plug, maintained circulation to 11500’ casing point. Run casing with no further losses.

Case Histories (continues) South Louisiana Operator: 17.2 ppg OBM 1900 feet open hole. Mud losses accrued during the drilling of 8.75” hole. Pumped and squeezed 120 bbls of NFS-BlackSeal ®, pulled above the loss zone, circulated with full returns. Ran back on top of the loss zone, broke circulation and drilling resumed with minimal losses. Operator in Galveston County: Lost 1400 bbls of oil base mud, stopped drilling, Lowered mud weight staged in the hole and pumped 65 bbls of NFS-BlackSeal ® pill. Squeezed into the formation, solved losses sufficient to run casing. Palace Royal: Louisiana Hole in casing, pumped 50 bbls and squeezed, with success ppg brine. Pumped single pill of NFS-BlackSeal ® on the backside, help pressure, completed the well.

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