1. Carpinteria Field Waterflood

2. Agenda Objective Phillips injection results Geologic aspects of waterflood Injection water supply o Quantity o Quality Water treatment Injection equipment

3. Waterflood Objective OCS-P 0166 Increase Oil Recovery by 10 to 15% of OOIP 16 – 20 MM bbls additional oil recovery

4. Carpinteria Offshore Field

5. Waterflood Objective OCS-P 0166 Increase Oil Recovery by 10% of OOIP 16 – 20 MM bbls additional oil recovery

6. Waterflood Objective OCS-P 0166 Increase Oil Recovery by 10% of OOIP 16 – 20 MM bbls additional oil recovery

7. OOIP Data DateSourceOOIP (MM bbls) Method 1968Phillips227 181 Volumetric 1998PACOPS157Volumetric 166Material Balance 2008PACOPS161-198Decline Curve

8. The Phillips Water Disposal Program Pilot Disposal Test March – June 1973 217,846 bbls into Well A-32 5-year Limited SWD 1973 - 1978 12,000,000 bbls into 5 Wells 300,000 – 500,000 STB from 8 offset producers Severe channeling Oil recovery was not maximized Enhanced oil recovery study 1983.

9. The Phillips Water Disposal Program Pilot Disposal Test March – June 1973 217,846 bbls into Well A-32 5-year Limited SWD 1973 - 1978 12,000,000 bbls into 5 Wells 300,000 – 500,000 STB from 8 offset producers Severe channeling Oil recovery was not maximized Enhanced oil recovery study 1983.

10. The Phillips Water Disposal Program Pilot Disposal Test March – June 1973 217,846 bbls into Well A-32 5-year Limited SWD 1973 - 1978 12,000,000 bbls into 5 Wells 300,000 – 500,000 STB from 8 offset producers Severe channeling Oil recovery was not maximized Enhanced oil recovery study 1983.

11. Repetto Producing Sands

12. Water Injection Wells, Top of F-1

14. Block M

15. Cross Section - Block M South North A-2 A-4 A-46ST1 A-1ST1 A-49WB1 A-43ST1 A-52ST1 F-1 F-3 F-2 F-4

16. Block – M Log Comparison A-2A-4 A-46ST1A-52ST1

17. SWD System at La Conchita Plant SWD Retention Tank Quintaplex Pumps Mixing Tank Media Filters To 4 line

18. SWD Rates Discharge to Ocean (250 total days from 6/2007 to 2/2008) 5 2 62 52 3 14 110 44% 21% 25% Number of Days Barrels per Day

19. Injection Water Quality Total Suspended Solids (TSS) Around 1 micron or less Critical Cations Calcium 66 ppm Barite unmeasurable Magnesium 80 ppm Other 0.5 ppm or less H 2 S 0.37 ppm dissolved O 2

20. Water Treatment Scale Inhibitor LSI: 0.4 – 1.53 Biocide SRBs Corrosion Inhibitor Treat Oxygen scavenger TBD

21. Equipment Layout at Platform Hogan Sampling point Chemical Injection Centrifugal pump Flow meter Low level High level Variable Choke Variable Choke 4 line from La Conchita Plant Disposal Tube Stabilizing Tank Flow Control Filter Bank Pressure gauge

22. Water Injection Wellhead and Manifold Layout 3 Master Valve 3 Well Manifold Kerotest valve Pressure gauge Sampling point 3 Actuated Wing Valve 3 Crown Valve Flow Tee or Cross 3 Choke Valve 3 Manifold Isolation Valve (MIV)3 Bowen Union Continuous Electronic Pressure Monitor Continuous Electronic Flowmeter

25. 61 MM 52 MM EL OPEX $1.5 MM/Mo Oil Price $75/bbl

26. 68 MM 52 MM EL