Case Study – Foothills Region, Canada 2008 CASING DRILLING TM Plastering Success 9-5/8” casing x 12-1/4” EZCase drilled from 850 M to 1,250 M CD effectively reduced lost circulation while drilling NPT reduction > 50% Days from Drill-out of Previous Casing Measured depth, meters

100% 50% 0% 2008 Results from Canadian Foothills: Circulation Improved while Drilling Ahead Measured depth, meters Partial Loss Stop drilling Drilling

Artic Permafrost Application Mackenzie Delta –Canada Conventional Drilling Issues Keeping Permafrost frozen is critical to wellbore stability. Hydrates and borehole erosion. Mud cooling is required. Conventional drilling requires high flow rates for hole cleaning. Lots of problems with high flow rate coolers. Difficult to keep hole stabile while tripping to run casing. Small pumps dictated by ice road limits. SPE paper

Artic Permafrost Application Mackenzie Delta –Canada Casing Drilling Solution Drilling with casing: eliminated need to trip. allowed good cleaning at low flow rates. minimized pressure losses (heating). implemented with small pumps BHA: 17-1/2 EZCase bit, stab, float collar, joint of casing, float collar, stab, 4 jts casing, stab, csg Mud cooling. KCl polymer mud (8-10% KCl depresses freezing) Spiral heat exchanger, ammonia refrigerant, glycol heat exchanger fluid Spiral exchanger minimized plugging but gave adequate contact surface and time.

Conclusions/Observations Minimized flat time. No borehole stability issues. Cooling system & CD prevented permafrost from degrading. Extended casing setting depth well below base of permafrost. Kept ROP below 15m/hr to minimize need to stop drilling and circulate for hydraulic lift. Walnut hull sweeps used to control balling. EZCase drilled out with TCI bit.

CASING DRILLING ® Project Summary Pan American ENERGY, Argentina  PAE received approval from government to extend its Cerro Dragon concession (4000 Km 2 ) to They will drill approximately 300 wells /year.  At least 10% of these well will benefit from CwD, due to problems associated to Water Injection/ depletion problems (High Losses).  CwD project initiated as Enhanced Productivity Project (rather than Drilling)  A typical well is cased with 9 300m & 5 2,400m.  Tesco ® Project: Evaluate a 5 well Project with 5½” BRT® OBJECTIVE: To be able to drill the production hole with minimum NPT associated to losses, trips, allowing a positive impact on the productivity of the well

Pan American ENERGY Project Summary  Successfully drilled both areas: Averaged 14 days/well.  Reduce NPT related to loss circulation and highly damaged reservoirs.  Reduced production hole from 13 to 11 days.  Good quality wells: Better CBL’s and one well did not require fracturing.  C Grande previously considered not accessible.  Value: Less Completion Costs & possibly better productivity. CURRENT CUSTOMER STATUS: CURRENT CUSTOMER STATUS: PAE Evaluating production results. PAE requesting fiscal leverage from government related to technology deployment, in order to start back in Jan 09 C Dragon C Grande Conv. CD1 CD2 CD3 Conv. CD4 CD5

Casing Size: 9-5/8 - 47Lbs/ft, L80, BTC c/w MLT™ Rings CASING DRILLING™ footage drilled 1,416 ft Job Date: September, 2008 What: 2 nd OFFSHORE DIRECTIONAL CASING DRILLING™ from a SIDETRACK Where: QATAR – MIDDLE EAST Job Details: Objective: Drill a directional section through unstable shale formation with 9 5/8” casing. Results: Used CDS™ to make up and run 9 5/8” casing, then drilled with the casing CASING DRILLING™ successfully drilled the 12 ¼” hole section into the reservoir SUCCESS IN THE ARABIAN GULF Lost 2 BHA’s drilling conventionally thru the unstable shale formation. Challenge:

BHA: PDC Bit/Rotary Steerable/MWD/RR/UR/Motor/DLA No issues tripping / drilling casing thru openhole sidetrack Used 1 BHA to drill the entire hole section at 38 ft/hr Successfully set / retrieved BHA using drill pipe (Level 3) Built from 65° to 86.4°, turning the azimuth from 272° to a 292 ° Unstable shale, pack-off csg near TD in the top of the reservoir BHA, tripped thru casing to surface, leaving shale behind casing No QHSE incident occurred during the Job No rig modifications were required Tesco’s CDE™ torque modeling proved reliable No loss circulation, Torque and Drag trended well Achieved desired directional trajectory Provided cased wellbore into reservoir. Highlights: Operations: RSS CD-BHA SUCCESS IN THE ARABIAN GULF