1. User Conference 11/14/13 Forgotten Oil & Gas Study John D. Grace Earth Science Associates Long Beach, CA 2013 User Conference Hosted by Maersk – Houston November 14, 2013

2. Goals High-grade opportunities for new production from dead reservoirs Develop methods for mass-batch decline curve analysis Identify non-balancing movements in field & sand reserve estimates Demonstrate data mining approach to analysis using GOM 3 User Conference 11/14/13

3. Decline Curve Study User Conference 11/14/13 Production Rate Number of Months On Last Production Date Estimated Current Abandonment Rate Production Estimated Remaining Recoverable Volume Statistically Estimated Decline Rate

4. Total Volumes & Uncertainty User Conference 11/14/13 0 100 12 9 6 3 0 200 300 400 500 Gas (Tcf) Oil (Million Bbls) Both oil and gas scaled in BOE

5. Size/Frequency Reservoir Recoverable Volume User Conference 11/14/13 0 10 500 20 MMCF 3 BCF 95 BCF MCF 0 1 2 3 4 Freq. (x 1,000) 0 10 500 20 M Bbls 3 MM Bbls 0 500 1,000 1,500 Freq.

6. Largest Reservoirs Found User Conference 11/14/13 6 12435 2 6 8 12 10 4 0 Remaining Oil (Million Bbls) Reservoirs 10 204060305070 20 40 0 10 30 Remaining Gas (Bcf)

7. Where Was 2012 Production? User Conference 11/14/13

8. Where is the Forgotten Oil & Gas? User Conference 11/14/13

9. Cost Proxies User Conference 11/14/13 Dot Size Proportional to Remaining BOE

10. Revenue Proxies - Oil User Conference 11/14/13

11. Revenue Proxies - Gas User Conference 11/14/13

12. Decline Methodology Studied reservoirs dead at end 2009 –Applied GOM 3 Decline Curve Tool in batch –Process data to find final regime break –Apply 4 standard engineering models Corrected bias in exponential estimates Retained confidence intervals for estimates Picked best model with R 2 (R 2 0.6) –Determined current abandonment rate User Conference 11/14/13

13. Break in Structural Regime User Conference 11/14/13 Global Prod. Max Break in Regime Estimated

14. Standard Decline Models Exponential rate v time: Linear rate v cumulative prod: Hyperbolic rate v time: If exponential; harmonic; hyperbolic User Conference 11/14/13

15. Models Tried: Picked Best Above Threshold User Conference 11/14/13 This reservoir does not pass the R 2 >0.6 criteria

16. Example: WC49 Field: L04 Sand User Conference 11/14/13 L04 SandL-8 & L-4NM reservoirs (12,919-13,134) Very low & strange production A and PA-3 reservoirs (13,406-14,308). Comps produced 27 & 28 bcf respectively 6 Bcf Remaining 371 MMcf Remaining ?

17. Wheres the Potential in WC49? User Conference 11/14/13

18. Plus: Dead but Not Declining User Conference 11/14/13

19. Look Where Reserves Do Not Balance User Conference 11/14/13

20. Found in Reserve Histories User Conference 11/14/13 6 BBL 4 BBL 34 TCF18 TCF 5 BBL 3.6 BBL 17 TCF 32 TCF Fields Sands

21. Next steps Get input from these presentations Complete analysis of Reserve Histories Final revisions to numbers & software Produce deliverables Decide on marketing strategy User Conference 11/14/13