SILICADRILL* - Silicate Water Based Drilling Fluid Applications Inhibitive Mechanism Concerns and Limitations Engineering The principal driver for the re-introduction of silicate fluids is environmental: In the North Sea operators have come under increasing pressure to drastically reduce the oil or synthetic based fluid levels currently discharged along with cuttings. Some operators (SHELL) have already adopted the policy that all 17 and 16.5” hole sections will be drilled with silicate drilling fluids. Silicate based systems are currently the most inhibitive fluids in the water based mud arsenal for drilling reactive claystone and chalk sections, previously drilled with OBM. The view here is that even synthetics discharged to the sea bed will leave an environmental legacy once the complete picture from sea bed surveys has been built. This presentation describes how the system functions and details the principal engineering aspects such as mixing procedures, maintenance and the effects of common contaminants. Success Stories 1 1 1

SILICADRILL* Drilling fluids based on soluble sodium silicate first introduced in 1930’s. Based on 20-50% soluble silicates Difficult to control because of high rheologies Silicate water based fluids further explored by collaboration between Mobil, BP Exploration, Shell Research and BW Mud. Recent silicate systems introduced based on lower concentrations of soluble silicates 1 1 2

SILICADRILL* Factors Determining Shale Inhibition Ability of fluid to reduce shale hydration proportional to : Increasing silicate concentration. Increasing salt concentration (KCl reducing shale hydration more than an equivalent level of NaCl). Minimum 10,000 ppm SiO2 required (3% v/v silicate solution). Optimum at higher pH (approaching pH 12) which additionally prevents fluid gelation. Evidence of synergy with polyalkylene glycols. 1 3 1

Physical Characteristics Viscosity / Temperature Profiles for Sodium Silicate Liquors Graph illustrating further data on the variation in viscosity of sodium silicate liquor as a function of mole ratio of SiO2 : Na2O . As the mole ratio and solids content increase, the viscosity of the sodium silicate liquor increases, particularly at low temperatures. Based on these observations along side both shale inhibition results and acceptable fluid properties, Dowell have selected a sodium silicate with a 2.0 :1 ratio and 42 - 44 % actives. A winterised version of this liquor has been developed for applications in colder climates, incorporating 3-5% KCl (which will probably be required for use in the North Sea if use of the neat silicate liquor is being considered for maintenance additions. It is important to note that the level of shale inhibition provided by silicate fluids is independent of the mole ratio of the sodium silicate liquor used - that is ranging from a ratio of 2.0 - 3.3 to 1 of Si02 : Na20. However, due to the progressively stronger buffering capacities at alkaline pH of sodium silicates with lower silica oxide ratios, it was found that using a sodium silicate liquor of 1.6 : 1 ratio will seriously compromise polymer performance (resulting in loss of viscosity and fluid loss control). 1 4 1

SILICADRILL* Effect of Fluid pH on Shale Inhibition pH Buffering of Silicates The pH behaviour and buffering capacity of silicate solutions is closely related to concentration and SiO2 : Na2O mole ratio. The buffering capacity of various sodium silicate liquors and how this affected observed levels of shale inhibition was investigated. The effect of pH and mole ratio on shale hydration and integrity was assessed using Bentonite/Kaolinite shale pellets exposed to each fluid under dynamic conditions at 200°F/16hrs. The formulation used, incorporating 5% w/v sodium silicate, provided effectively approximately the same level of of SiO2 in each fluid, Results 2.0 : 1 molar ratio sodium silicate liquor provides optimum buffering around pH 12, and the most stable fluid after ageing at 200°F. The results indicate that if the pH is increased above 12.5, either by the addition of a more ‘alkaline’ sodium silicate or by hydroxyl ions, the performance of viscosifying and fluid loss polymers is compromised. 1 5 1

SILICADRILL* Effect of Sodium Silicate Concentration on Shale Inhibition Shale recovery and hydration studies using bentonite/kaolinite pellets, which approximate to young tertiary claystones (swelling characteristics), show that approximately 8-10 % v/v is required to effect adequate shale stabilisation. Below 10 % v/v sodium silicate fluids formulated with fresh water out perform those formulated with sea water, indicating that an excess of silicate is required to counter the reaction of calcium and magnesium with silicate; this seems to be the case despite the pre-treatment of the sea water with soda ash. There appears to be an equilibrium set up where the silicate competes with soda ash for calcium and magnesium. 1 6 1

SILICADRILL* Effect of Salt Concentration on Shale Inhibition Sodium Silicate Moisture (%) Effect of Salt Concentration on Shale Inhibition Fluids were formulated with 3 v/v% and 6 v/v % sodium silicate liquor and the effect of salt concentration on shale pellet stability assessed. A reduction in shale pellet hydration is seen with (a) increasing silicate concentration and (b) increasing salt concentration. with 25ppb KCl reducing shale hydration more than an equivalent level of NaCl. Blank 15ppb 30ppb 54ppb 109ppb 25ppb Sodium Chloride Potassium Chloride 1 7 1

SILICADRILL* Synergy with Polyalkylene Glycol The degree of shale hydration inhibition which can be achieved from a hybrid silicate/polyalkylene glycol (PAG) fluid is shown here. STAPLEX 500 is a low molecular weight PAG used in the QUADRILL system. A sodium silicate fluid (8% v/v brine phase) alone provides good shale inhibition, but the amount of shale pellet hydration can be still further reduced with additions of 1-3% STAPLEX 500. Further work is required in this area but if a synergy exists between silicate and glycol components , the concept of a ‘super’ inhibitive water based fluid closely approaching the performance of OBM’s may become a reality. Recent work has also illustrated that the performance of fluid loss and viscosifying polymers can be thermally extended when glycol is added to a silicate fluid. 1 8 1

SILICADRILL*-Premix Formulation 25% v/v sodium silicate liquor To minimise problems encountered during mixing at the rig site and storing large volumes of chemicals, a premix is recommended: to be prepared at a mixing plant in town. The premix incorporates double the concentration of silicate liquor and fluid loss additives required for most applications. It may also include an excess of KCl above that programmed. Formulation for a concentrated premix to reduce logistics based on 25 % v/v sodium silicate liquor, 60 lb/bbl KCl and double the fluid loss package.. The premix will then be transported to the rig site and diluted back with drill water or treated sea water. It is recommended that polymer additions be made under high shear mixing conditions (cement unit available) before the addition of the KCl and silicate. 1 9 1

SILICADRILL*-Fluid Formulations and Properties Typical formulation and properties of a silicate fluid and is what we are presently recommending for implementation in to the field. A sodium silicate liquor which is 42% active, with a 2: mole ratio of SiO2 to Na2O was selected based on its viscosity profile at lower temperatures. 1 1 10

Mechanism Barrier formation at near well bore pH 7 Invasion of filtrate (pH 12) Gellation of invading silicate species in lower pH environment Precipitation of insoluble Ca2+, Mg2+ silicates Chemical dissolution of Al / cementation of clays Ca2+ Mg2+ pH 7 Barrier formation at near well bore Silicate Inhibition Mechanisms Representation of polysilicate species which may exist in solution. The inhibitive mechanisms currently put forward currently centre around two main mechanisms:- a) the silicate filtrate contacts the pore fluid in the formation and undergoes a drop in pH. The silicate fluid undergoes gelation forming a semi permeable membrane. b) the first mechanism is augmented by the presence of calcium and magnesium cations which form insoluble silicates. The solid precipitates effectively cement the near well bore forming an impermeable membrane, which prevents pore pressure penetration and the subsequent build up of hydration stress. c) the high pH filtrate changes the physio-chemical nature of the clays which undergo a redistribution of components ie. redistribution of silica and or alumina. 1 11 1

Mechanism-Clay Alteration b c Transmission Electron Micrographs of Kaolin clay treated with various fluids: a) raw untreated clay b) aged for 3 days at 300 F in distilled water c) aged for 3 days at 300 F in a 3% aqueous sodium silicate solution at pH 12 Clay Alteration by Silicates The effect of a high pH sodium silicate solution on a pure grade, well characterised clay substrate was examined. A pure grade of Kaolin clay, (ECC Supreme, containing negligible amounts of exchanged divalent cations) was aged at 300 F for 3 days in distilled water at pH 7 or 3% (w/w) sodium silicate at pH 12.0. TEM (a) shows an unexposed sample of Kaolin comprising well defined crystalline particles. The sample aged in distilled water, shown in (b), did not appear to have changed significantly (some smaller particles were evident). The sample aged in a sodium silicate at pH 12.0, (c), showed marked changes in morphology: a large number of aggregates or ‘flocs’ of finer material had been formed. Subsequent X-ray diffraction analysis of these samples showed that the Kaolin content of the sample exposed to sodium silicate and high pH had been reduced from 95 to 92%. Furthermore this sample’s diffraction pattern contained new peaks at 28, 33.3, 21.6, and 17.6 (corresponding to 3.1865, 2.6905, 4.1140 and 5.0390 Å). These peaks do not correspond to sodium silicate or simple sodium aluminium silicates; rather to the formation of a synthetic zeolite mineral phase. The naturally occuring zeolite, Phillipsite, (K0.79Na0.68Ca0.68Fe0.08Al2.81Si5.12O16.6.39H2O) or potassium sodium calcium aluminium silicate hydrate has an X-ray diffraction pattern whose principal peaks match these new peaks in that of the silicate aged sample. Neither the untreated clay or the sample aged in distilled water exhibited such changes. We believe these results demonstrate that some redistribution of clay species is occurring as a result of dissolution at high pH and subsequent in-situ reprecipitation. We believe these events also contribute to permeability reduction in the shale matrix. 12

Concerns Sensitive to solids contamination Sensitive to CO2 and H2S contamination Can cause severe gellation and elevated fluid loss if pH is not maintained. Low shear viscosity is borderline, limiting applications for deviated wells. Lubricity is poor compared to other water-based muds. Foaming problems identified with IDLUBE XL. Alternative lubricants under review. Temperature stability limited to wells where BHST is below 230°F. Concern over formation damage in some reservoirs. Depth of invasion of damage not determined. Elastomer Compatibility Progressive gellation of silicate fluids over long time periods. Not recommended as packer fluids. Logistics. The volume of sodium silicate stabiliser (C307) recommended for optimum shale control is 8-12 % by volume of the brine phase. 1 13 1

Temperature Stability Effect of Temperature on Fluid Properties TFL Fluid Formulation Fresh water Sodium silicate Liq. 10% KCl 40.0 ppb IDVIS 1.3 ppb IDF-FLR XL 1.5 ppb IDFLO 4.5 ppb PTS 200 2.0 ppb HMP 35.0 ppb Barite 97.1 ppb Mud Weight 11.5 ppg 1 14 1

Elastomer Compatibility Change in Elastomer Surface Hardness CARBOXYLATED VITON NITRILE HSN NITROXILE QUADRILL Silicate KCl / polymer ANADRILL have reported problems with premature failure of face seals on the MWD hydraulic tool, the lifespan of the tool being reduced from typically 500 hrs to 20 hrs. Precipitation of silica glass was occurring at the seal face and leakage of hydraulic oil was occurring. ANADRILL have solved the problem by use of new face seal materials and lubricants. Another concern was the compatibility of elastomers used in down hole sealed bearing drilling motors with silicate fluids compared to conventional fluids. Various elastomer types were hot rolled in solids free, non-viscosified fluids for 72 hrs at 250°F, and the effect monitored by measuring changes in surface hardness, volume and weight of elastomers after exposure. Surface hardness was determined using a penetrometer device where a needle probe is driven into the surface of the seal at a constant rate at a constant rate of 10 mm/min , with the final probe destination at 1mm from the face surface of the seal. Surface hardness was calculated from the max. slope of the resultant penetrometer traces and expressed as a percentage change from the initial state. Viton becomes very embrittled with the surface becoming very cracked after exposure to silicate fluids. Polypak Polypak Polypak Polypak NW6 NW6 MZ3 MZ3 Seal Boot Seal Boot (o-ring) (o-ring) 1 15 1

Elastomer Compatibility Change in Elastomer Dimensions QUADRILL Silicate KCl / polymer CARBOXYLATED VITON NITRILE HSN NITROXILE Polypak Polypak Polypak Polypak NW6 NW6 MZ3 MZ3 Seal Boot Seal Boot (o-ring) (o-ring) 1 16 1

Elastomer Compatibility Change in Elastomer Weight (Swelling / Erosion) QUADRILL Silicate KCl / polymer CARBOXYLATED VITON NITRILE HSN NITROXILE Polypak Polypak Polypak Polypak NW6 NW6 MZ3 MZ3 Seal Boot Seal Boot (o-ring) (o-ring) 1 17 1

Lubricity Frictional Wear Almen-Wieland Lubricity Results Test similar to a casing frictional wear tester but with much smaller dimensions. PCF will be acquring a larger lubricity tester where the contact pressures are more representative of down-hole conditions. The tester will have the capability of evaluating the coefficient of friction at metal-metal and metal-rock interfaces. I daN = 1Kg = 2.2 lbs Load Therefore max. load applied during the test is 334 lbs/square inch and during the test the temperature a the point of contact increases from 30°C to 126°C at 50 daN and 1150 daN respectively. 1 18 1

CO2 and Carnalite Brine Effect of CO2 and Carnalite Brine on Fluid Properties Carbon dioxide The main effect observed on a silicate fluid is a reduction in pH resulting in fluid gellation and a reduction, a massive diminution in soluble silicate concentration and a loss in filtration control. If the system is treated with caustic and the pH maintained, carbon dioxide contamination has minimal effect on rheological properties and fluid loss control is not adversely effected. Post-treatment of the fluid with caustic will alleviate some of the gelation problems. However full recovery of fluid loss control may only be affected by addition of further FLR XL or IDFLO. Carnalite Brine Carnalite brine contamination results in a reduction in pH with consequent fluid gelation and increased fluid loss. Reaction of sodium silicate with divalent magnesium ions will result in precipitation of insoluble magnesium silicate and severe depletion of silicate from the system. Fluid gelation resulting from carnalite brine contamination can be alleviated by maintaining pH with the additions of caustic as shown above. If the contamination occurs in the form of a brine flow then post treatment with caustic is recommended. Severe contamination is best treated by a whole mud dump and dilute. It is very difficult to treat the mud back once such contamination has occurred. Evidence of this is shown by the amount of caustic necessary to attain acceptable properties after 10 % Carnalite brine contamination Properties after heat ageing at 160 °F. 1 19 1

Drilled Solids Effect of Bentonite Contamination on Fluid Properties Bentonite Clay used to simulate drilled solids contamination, leads to increases in yield point and plastic viscosity. Low end rheology and gel strengths appear to be unaffected whilst the fluid loss control is reduced significantly. Although the influence of drilled solids does not appear to be drastic from these results, the detrimental effect is compounded by prolonged exposure at temperature and high pH. The concentration of the silicate is reduced further after longer exposure and the solids become more and more dispersed (due to less inhibition) causing very large changes in fluid properties. A solids laden system is not recommended and in fact a predetermined dump and dilute programme should be set before the system becomes unmanageable. Properties after heat ageing at 160 °F. 1 20 1

Cement and Chalk Effect of Cement and Chalk Contamination on Fluid Properties Properties after heat ageing at 160 °F. Chalk Chalk contamination does cause a large increase in PV and a slight increase in YP. Such contamination does lead to elevated fluid loss. Reaction of sodium silicate on the surface of drilled chalk forming an inert barrier (calcium silicate formation) will retard chalk dispersion into the fluid. Cement Cement contamination causes large increases in plastic viscosity and a large reduction in silicate concentration via the formation of calcium silicate. There is a slight decrease in fluid loss control. Cement Slurry(4) 50% w/w slurry in fresh water 1 1 21

ULTIDRILL Contamination Effect of Contamination of an ULTIDRILL Invert Synthetic Fluid ULTIDRILL Contamination Shows the effect of contamination by an ULTIDRILL Invert Synthetic system on a silicate fluid. This was performed to ascertain if significant contamination was detrimental to the system. It is clear that even with 5 % v/v Ultidrill contamination the silicate concentration in the fluid is substantially reduced from 53,000 ppm to 38,250 ppm. This result may be ascribed to the reaction of sodium silicate with calcium in the brine phase of the invert. It may also be possible that some of the silicate in the WBM brine phase has become emulsified leaving it unavailable for inhibition. The other effects of severe ULTIDRILL contamination are to increase the rheological properties of the fluid, particularly PV, YP and gel strengths and to reduce fluid loss. Therefore, it is important that the lines and tanks at the rigsite are thoroughly washed out effectively to remove any invert previously mixed. This is also true if a premix fluid is prepared at a mixing plant in town. Properties after heat ageing at 160 °F. 1 22 1

Reservoir Damage Characteristics Return Permeability Studies on Berea Sandstone Cores % Return Permeability Reservoir Impairment The reservoir damage characteristics of a silicate fluid were tested with Berea sandstone cores using the LTLP mud loop apparatus. Two separate tests were run using similar cores, one saturated with 10% NaCl brine and the other with a harder formation water containing multivalent ions (0.1% FeCl3, 1.2% MgCl2, 4.2% CaCl2, 0.1% KCl and 17.2% NaCl). In each test the permeability of the cores to kerosene before and after exposure to the mud. A much greater reduction in return permeability is seen from the core saturated with the harder mixed brine formation water than is evident with 10% NaCl. This reduction may be attributed to precipitation of insoluble calcium and magnesium silicates extending into the pore throats of the sandstone cores causing damage. In conclusion, a silicate fluid used to drill into the reservoir zone could be quite damaging particularly as the results illustrated were run on a relatively high permeability sandstone. However the depth of damage has not yet been ascertained but considering the gelatinous nature of Ca2+, Mg2+ silicate precipitated, it may only be ‘skin’ deep. Preliminary SEM examination of the cores were inconclusive and this forms an area for further work. This fluid is not recommended for reservoir sections where an open hole completion is anticipated. Where section is to be cased and perforated there should be no problems. Time (min) 1 23 1

Concentration Monitoring Titration Procedure (NaF - HCl) Si02 Na2O Titration Method for silicate determination A specific test has been developed which accurately monitors the level of SiO2 in the filtrate, based on a two step titration with hydrochloric acid and sodium fluoride. Operational chart showing ppm SiO2 determined from the titration method to that programmed in the fluid. Potassium Determination The method uses the standard sodium perchlorate precipitation technique, is unaffected by high pH, the presence of polymers or silicate in the filtrate. 1 24 1

SiO2 Adsorption Isotherms Silicate Depletion on LGS 1 25 1

Effective Engineering Maintain pH with Routine Additions of Caustic Soda. Control LGS with pre-defined Dump & Dilute Programme Maintain SiO2 with Additions of Sodium Silicate Liquor Pf / Mf Ratio Control of LGS build up is important to prevent fluid gelation. It is thought that the presence of montmorillonite or other clays will catalyse the polymerisation of the SiO2 species, leading to a highly gelled network structure 1 26 1

SILICADRILL* - Special Considerations

Environmental Impact Not classified as toxic or dangerous (main hazard attributable to high alkalinity) Silicates known to form an important resource in the marine food chain. OSPAR green list - Category ‘A’ UK CNS (Chemical Notification Scheme) category ‘E’ rating The proposed Preliminary Assessment Information Rule under TOSCA included soluble silicates : The environmental regulatory profile of soluble silicates provides incentive for their preference over more hazardous and more highly regulated alternate materials 1 28 1

HSE Issues Main hazard of sodium silicate liquor attributable to high alkalinity. Rabbit dermal irritancy study on silicate drilling fluid indicated no reaction (up to 4 hours exposure). No field problems reported with respect to skin irritancy of silicate drilling fluid on any well intervals drilled using SILICADRILL*. PVC slicker suits recommended if heavy contamination expected. PVC or rubber gloves are recommended Eye contact must be avoided. Glasses or goggles should always be worn, and preferably face visors while working on the drill floor or in the mud processing area. Vapours from the drilling fluid will not be a problem, but mists possibly generated from the shale shakers could be irritating to the respiratory tract. Adequate ventilation will keep mist to a minimum, but if mists are generated respiratory protection in the form of a dust respirator type P1 is recommended. 1 29 1

Shale Hydration H20 Adsorption from Drilling Fluid 1 30 1

Shale Integrity Penetrometer Hardness Profiles Force (g) Comparison of the Inhibitive Performance of Silicate Systems with other Fluid Types The shale inhibition derived from silicate and hybrid silicate/PAG fluids was directly compared to other water based fluid and an invert synthetic oil based fluid (ULTIDRILL). The pellet integrity (hardness) after exposure to each fluid was measured as a function of depth of penetration into the substrate. This slide clearly illustrates the improvements made in the performance of water based fluids and how they approach that of oil based fluids. Penetration (mm) 31 1 1

Current Status First Dowell Silicate well spudded July 1997 (Canada). Dowell Canada have used and seen benefits from the lubricant (XE859) First Dowell Silicate Well in the North Sea -a full success Sept 1997. Engineers’ Training of this new mud system is ongoing at UTC and KTC. Resources are now in place to extend applications wrt Improved Thermal Stability Improved lubricity and ROP Improved hole cleaning capabilities 1 32 1

Future Work Further evaluation of XE859 (SHELL, Houston). Initial indications that it aided clean up on MI-BP Tester metal surfaces. Further evaluation of highly modified cross-linked starches. For higher temperature applications or where restrictions on use of PTS 200. Accretion concerns in silicate fluids formulated with NaCl (GOM). “Anti-accretion” organics to be further investigted, possibly in conjunction with XE859 Lubricant. Dispersants No significant thinning action in solids laiden muds, but still to evaluate in Ca2+/Mg2+ - silicate gelled system. (IDSPERSE XT, DRILLTHIN, D145, TKPP). 1 33 1

SILICADRILL* Field Experience Ten hole intervals (July 1997-Jan 1998) 4 X 16” and 4 X12 1/4” intervals offshore Canada 1 X16” and 1 X 171/2” intervals in the Central North Sea All intervals drilled with SILICADRILL* after extensive laboratory evaluation of offset well cuttings - XRD Mineralogical analyses - Shale inhibition studies cf. ULTIDRILL & QUADRILL - Evaluation of Accretion tendency 34

Drilling with SILICADRILL* in the North Sea Case History #1: Appraisal Well * Objective to Drill 12 1/4” section through reactive shales in the central North Sea * Formation was soft plastic shale stones from 3037 to 7920 ft * Previous attempts to drill with water based muds in this area were unsuccessful * S-shaped well trajectory reaching a maximum inclination of 46 ° * SILICADRILL* was chosen ahead of SBMs on environmental grounds * BHST @ 168 °F, max mud weight 13.1 ppg 35

* All Logging and coring completed successfully Drilling with SILICADRILL* in the North Sea Case History #1 (Cont’d): Appraisal Well * Rig-site evaluation of inhibitive performance using BP cuttings hardness tester * Excellent wellbore stability: hole in gauge despite 29 days open hole time Mud related NPT= 3.7% * All Logging and coring completed successfully * Logging fluid designed using Fann 70 which determined clean mud was required to avoid gelation * The biggest problems were logistical. The mud was run at higher solids levels than programmed (7.3 cf 4%) due to low stocks of silicate liquor * DUALFLO successfully used to boost low end rheology 36

SILICADRILL* - Offshore North Sea Case History #1: Hole Caliper Logs Operational Summary Initial hole enlargement associated with physical wellbore instability due to insufficient mud weight (cavings). 37

Drilling with SILICADRILL* in the North Sea Case History #2: * Objective to Drill 17 1/2” section through 6547ft of reactive shale in CNS * Decision to drill made by operator following success of #1 * Vertical to 7500 ft building to 22.8° by 8450 ft, TD at 9535 ft * Open Hole time of 47 days with no wellbore stability * 17 days drilling time; delays due to non mud related equipment failures, WOW and wellhead problems * Largest Volume of hole drilled by Operator in the North Sea to date * FMP successfully used with this mud system for the first time 38

Drilling with SILICADRILL* offshore CANADA Case History #3: Developmental Wells * Objective to drill two 16” sections through 7000 ft reactive and dispersive shales * Formation was mainly siltstone and mudstone * Maximum hole inclination of 40 ° * SILICADRILL* was chosen on environmental grounds * STAPLEX 500 was included to maximise inhibitive performance (lab tests) * BHST 180 °F, max mud weight of 10.1 ppg 39

* No wellbore stability issues despite 20+ days open hole Drilling with SILICADRILL* offshore CANADA Case History #3: Developmental Wells (Cont’d) * No wellbore stability issues despite 20+ days open hole * Observed 30% depletion of K+ and SiO2 whilst drilling initial formation * Fluids also used to drill 12 1/4” sections successfully * Silicate depleted and mud converted to salt/ polymer/ carbonate * Well logged, cored and tested without problem-now producing at a satisfactory rate * Costs reduced by > two thirds over course of next 4 sections via optimising fluid (lower silicate, removal of STAPLEX 500 and replacement of IDVIS with prehydrated bentonite gel) 4-5% STAPLEX 500 programmed in the 16” intervals of Canadian offshore development wells. Glycol allowed to deplete in the 12¼” interval of 1st well and omitted entirely from 12¼” interval of the second well. Pilot tests conducted on the platform indicated that the presence of glycol did NOT significantly enhance the chemical inhibitive properties of the mud - and contributed to a 25% increase in the barrel price of the mud. 40

Drilling with SILICADRILL* offshore CANADA Case History #3: Hole Caliper Logs Operational Summary All case histories show silicate system provides excellent chemical wellbore stabilisation (most inhibitive water based mud). Initial barrel price comparable to QUADRILL (reason - need more polymers for control of viscosity and fluid loss . High maintenance and dilution rates mean that effectively a silicate system is more expensive to engineer, leading to pot5entially higher costs/ft than ULTIDRILL oil based mud. Field optimisation of the system in Canada and North Sea has reduced costs of fluid below that of SBMs. 41

Drilling with SILICADRILL* offshore CANADA Extent of Claystone Hydration with K+, SiO2 Concentration (16” Interval, Well-East) Extent of hydration of claystone (mudstone) cuttings monitored on the 16” intervals of Canadian offshore developments, and plotted as a function of KCl and silicate concentration. Cuttings containing sand and limestone sequences omitted from the final analysis. 42