Formate brines – Some published milestones OMV Pakistan start using K formate to drill and complete (with ESS) in HPHT gas wells K/Cs formate brines used as well perforating fluids in 11 HPHT gas fields in UK North Sea : Dunbar, Shearwater, Elgin, Devenick, Braemar, Rhum, Judy, Glenelg, Kessog, Jura and West Franklin Saudi Aramco start using K formate to drill and complete (with ESS) in HPHT gas wells Potassium formate from Addcon Gravel pack with K formate brine in Statfjord B First MPD operation in Kvitebjørn with K/Cs formate “designer fluid” First of 12 completions in the Kashagan field with K/Cs formate Total’s West Franklin F9 well (204 o C) perforated in K/Cs formate brine Petrobras use K formate brine for open hole gravel packs in Manati field

Saudi Aramco have been drilling HPHT gas wells with potassium formate brine since 2003 Potassium formate from Addcon

Saudi Aramco use of formate brines, deep gas fields 44 HPHT wells drilled 70,000 ft of reservoir drilled at high angle 90,000 bbl of brine recovered and re-used Good synergy with ESS, also OHMS fracturing Potassium formate from Addcon

Summary from Aramco’s OTC paper Potassium formate from Addcon

Pakistan - OMV use potassium formate brine for HPHT deep gas well drilling and completions Potassium formate from Addcon

Extracts from OMV’s SPE papers and SPE presentations – note 1,700 psi overbalance, and 350 o F Potassium formate from Addcon

North Sea - K/Cs formate brines used as combined HPHT drill-in and completion fluids 33 development* wells drilled and completed in 7 HPHT offshore gas fields Huldra (6 ) Tune (4) Devenick (2) Kvitebjoern (8 O/B and 5 MPD) Valemon (1) Kristin (2) – Drilled only Vega (5) * Except Valemon (appraisal well) Mostly open hole stand-alone sand screen completions Potassium formate from Addcon

Tune field – HP/HT gas condensate reservoir drilled and completed with K formate brine, wells : m horizontal reservoir sections. Open hole screen completions. Suspended for 6-12 months in formate brine after completion Potassium formate from Addcon

Tune wells - Initial Clean-up – Operator’s view (direct copy of slide) June 2003 Potassium formate from Addcon Wells left for 6-12 months before clean-up Clean-up : hours per well Well performance Qgas 1.2 – 3.6 MSm3/d PI 35 – 200 kSm3/d/bar Well length sensitive No indication of formation damage Match to ideal well flow simulations (Prosper) - no skin Indications of successful clean-up Shut-in pressures Water samples during clean-up Formate and CaCO 3 particles Registered high-density liquid in separator Tracer results A-12 T2H non detectable A-13 H tracer indicating flow from lower reservoir first detected 5 sd after initial clean-up doubled well productivity compared to initial flow data No processing problems Oseberg Field Center

Tune – Production of recoverable gas and condensate reserves since 2003 (NPD data) Good early production from the 4 wells - No skin (no damage) million m 3 gas /day - 23,000 bbl/day condensate Good sustained production - 90% of recoverable hydrocarbon reserves produced by end of Year 7 NPD current estimate of RR: billion m 3 gas million bbl condensate Rapid and efficient drainage of the reservoir Potassium formate from Addcon

6 production wells 1-2 Darcy sandstone BHST: 147 o C TVD : 3,900 m Hole angle : o Fluid density: SG m x 8 1 /2 ” reservoir sections Open hole completions, 6 5 /8 ” wire wrapped screens Lower completion in formate drilling fluid and upper completions in clear brine Huldra field – HPHT gas condensate reservoir drilled and completed with K/Cs formate brine, 2001 Potassium formate from Addcon

Huldra – Production of recoverable gas and condensate reserves since Nov 2001 (NPD data) Plateau production from first 3 wells - 10 million m 3 gas /day - 30,000 bbl/day condensate Good sustained production - 78% of recoverable gas and 89% of condensate produced by end of Year 7 - Despite rapid pressure decline..... NPD current estimate of RR: billion m 3 gas million bbl condensate Rapid and efficient drainage of the reservoir Potassium formate from Addcon

13 wells to date – 8 O/B, 5 in MPD mode 100 mD sandstone BHST: 155 o C TVD : 4,000 m Hole angle : o Fluid density: SG 2.02 for O/B m x 8 1 /2 ” reservoir sections 6 wells completed in open hole : 300-micron single wire-wrapped screens. Remainder of wells cased and perforated Kvitebjørn field – HPHT gas condensate reservoir drilled and completed with K/Cs formate brine, Potassium formate from Addcon

A few of the highlights from Kvitebjoern Kvitebjoern well Completion time (days) A A A A A * * Fastest HPHT well completion in the North Sea “The target well PI was 51,000 Sm 3 /day/bar This target would have had a skin of 7” “A skin of 0 would have given a PI of 100,000” “THE WELL A-04 GAVE A PI OF 90,000 Sm 3 /day/bar (ANOTHER FANTASTIC PI)” Operator comments after well testing (Q ) The Well PI was almost double the target Potassium formate from Addcon Fast completions and high well productivity

Kvitebjørn– Production of recoverable gas and condensate reserves since Oct 2004 (NPD data) Good production reported from first 7 wells in million m 3 gas /day - 48,000 bbl/day condensate Good sustained production (end Y8) - 37 billion m 3 gas - 17 million m 3 of condensate - Produced 70% of original est. RR by end of 8th year NPD : Est. RR have been upgraded - 89 billion m 3 gas (from 55) - 27 million m 3 condensate (from 22) Note : Shut down 15 months, Y3-5 - To slow reservoir pressure depletion - Repairs to export pipeline Potassium formate from Addcon

Economic benefits of using formate brines SPE (2010): “A Review of the Impact of the Use of Formate Brines on the Economics of Deep Gas Field Development Projects” SPE (2011): “Life Without Barite: Ten Years of Drilling Deep HPHT Gas Wells With Cesium Formate Brine” Potassium formate from Addcon

Economic benefits from using formate brines - Good well performance and recovery of reserves “High production rates with low skin” * “ We selected formate brine to minimise well control problems and maximise well productivity”* * Quotes by Statoil relating to Kvitebjoern wells (SPE ) Potassium formate from Addcon

Economic benefits from using formate brines - More efficient and safer drilling “ a remarkable record of zero well control incidents in all 15 HPHT drilling operations and 20 HPHT completion operations” Better/safer drilling environment saves rig-time costs Stable hole: see LWD vs. WL calipers in shale Elimination of well control* and stuck pipe incidents Good hydraulics, low ECD Good ROP in hard abrasive rocks * See next slide for details Potassium formate from Addcon

Economic benefits from using formate brines - Improved well control and safety Elimination of barite and its sagging problems Elimination of oil-based fluids and their gas solubility problem Low solids brine  Low ECD (SG ) and swab pressures Inhibition of hydrates Ready/rapid surface detection of well influx Elimination of hazardous zinc bromide brine Potassium formate from Addcon

- Drill-in and completing with formate brine allows open hole completion with screens - Clean well bores mean no tool/seal failures or blocked screens - Completion time 50% lower than wells drilled with OBM “ fastest HPHT completion operation ever performed in North Sea (12.7 days)” Economic benefits from using formate brines - More efficicient/faster completions Potassium formate from Addcon

No differential sticking Pipe and casing running speeds are fast Mud conditioning and flow-check times are short Displacements simplified, sometimes eliminated Duration of flow back (minutes) Fluid Gain (bbl) Potassium formate from Addcon Flow check fingerprint for a Huldra well Economic benefits from using formate brines - Operational efficiencies

Economic benefits from using formate brines - Good reservoir definition if Cs present in fluid High density filtrate and no barite Filtrate Pe up to 259 barns/electron Unique Cs feature - makes filtrate invasion highly visible against formation Pe of 2-3 b/e LWD can “see” the filtrate moving (e.g. see the resistivity log on far right – drill vs ream Good for defining permeable sands (see SAND-Flag on log right ) Consistent and reliable net reservoir definition from LWD and wireline Potassium formate from Addcon

Economic benefits from using formate brines - Good reservoir imaging Highly conductive fluid Clear resistivity images Information provided: - structural dip - depositional environment - geological correlations Potassium formate from Addcon

Formate brines – Summary of economic benefits provided to users Formate brines tend to improve oil and gas field development economics by : Reducing well delivery time and costs Improving well/operational safety and reducing risk Maximising well performance Providing more precise reservoir definition Potassium formate from Addcon

OPERATORLOCATION Packer Fluid (ppg) BHT (°C) BHT (°F) Start Date End Date Comments DevonWC 165 A-78.6 KFo /2005 DevonWC 165 A-88.6 KFo /2006 Devon WC 575 A-3 ST2 9.5 KFo /2005 WOG/DevonMO 862 #112.0 NaKFo /20055/2006 Well P&A – H 2 O production – G-3 in excellent condition BP/ApacheHI A-5 #111.5 NaKFo /20024/2008 Well P&A - Natural depletion – S13Cr in excellent condition ExxonMobilMO 822 #712.0 NaKFo EPLST 42 #111.5 NaKFo EPLST 41 #F113.0 NaKFo EPLEC 109 A NaKFo EPLST 42 #212.8 NaKFo Dominion WC 72 #3 BP NaFo EPL WC 98 A-3 ST NaKFo EPLWC 98 A NaKFo Formate brines as packer fluids in GOM Potassium formate from Addcon

177ºC, 14,000 psi S13Cr tubing failed from CaCl 2 packer fluid Well worked over and re- completed with Cs formate 1.4 g/cm 3 Na/K formate used as packer fluid Tubing retrieved 6 years later Tubing was in excellent condition. BP High Island – Na/K formate brine as packer fluid for 6 years Potassium formate from Addcon