1. “Perspectives on Montana’s Petroleum Industry” MREA-MPA-MONTAX “Bridges to the Future” Conference October 15, 2009 Dave Ballard President Ballard Petroleum Holdings LLC Billings, Montana

2. Presentation Overview Industry Overview and Economic Contribution Meet the Producers Producing Areas and Trends Geologic Elements of an Oil Field Regional Geology Field Examples and the Technology of Discovery and Production Have We Reached Peak Production?

3. Field Examples and the Technology of Discovery and Production Surface Geologic Mapping Subsurface Geologic Mapping Seismic Mapping Shallow “Tight” Gas Frac Stimulation Horizontal Drilling and Frac Stimulation Waterflood Enhanced Oil Recovery CO 2 Flood Enhanced Oil Recovery Sensitive Environment Operations

4. Subsurface Prospect Mapping Examples Fred & George Creek (1963) Bell Creek (1967) Elm Coulee (2000) Cutbank (1926) Sumatra (1952)

5. Stratigraphically Trapped Oil Example Fred & George Creek Oil Field, Toole County, MT Sunburst –A Channel Map and Cross Section Discovered 1963 using subsurface geology From: Montana Geological Society, 2006, “Montana Oil & Gas Fields”

6. Bell Creek Oil Field, Powder River County, Montana Muddy Sand Isopach Map Discovered 1967 using subsurface geology Cum 132 MMBO

7. Bell Creek Oil Field, Powder River County, Montana 17 dry holes drilled in the area prior to discovery

8. NE Montana Red River Play Many small fields discovered using 2D and 3D seismic technology Updated as of May, 2009 NE Montana Red River,

9. Bainville North Oil Field, NE Montana 3D Seismic Survey 6.5 mi 5.2 mi From: Sheridan, Montana Tech, “Geology of the Bainville North Oil Field”

10. Detailed Structure Map from 3D Seismic From: S. Mogensen, St. Mary Land & Exploration Company Bainville North Oil Field, Roosevelt Co., MT 3D Seismic Red River Subsea Depth Structure C.I. = 10 ft Cum Prod. 8.3 MMBO N