1. Sample Heavy Oil Screening Study Prepared For Epsilon Energy LTD. 3-31-2009 Gemini Solutions Inc. James L Buchwalter, P.E./PhD.

2. Goal Of Sample Heavy Oil Screening Study  Build model with crude properties similar to those found in the heavy Syrian Crude –Guess properties to allow vertical well rates of 20 BOPD with 11 API crude  Run sensitivities to reservoir temperature increase from steam flood, horizontal versus vertical wells, and pattern aspect ratio and development size –These sensitivities can be used to understand probable flow streams, economics, and rank multiple prospects in a consistent fashion

3. Basic Model Assumptions  Rock properties

4. Basic Model Assumptions  pvt properties

5. Basic Model Assumptions  Kr properties  20% water saturation

6. Basic Model Assumptions  Pattern Model Setup

7. Well Production Profile, 20 years 160 acres, no steam, vertical well

9. Sensitivity – Horizontal Well 160 acres, 3/1 aspect ratio, 3000 feet long blue [=] horizontal well, green [=] vertical well Recovery increase 4 fold !!

10. Sensitivity – Horizontal Well 160 acres, 3/1 aspect ratio, 3000 feet long Recovery increase 4 fold, 5% recovery factor !!

11. Horizontal Well Pressures after 20 years 160 acres, 3/1 aspect ratio, 3000 feet long Horizontal Well Pressures after 20 years 160 acres, 3/1 aspect ratio, 3000 feet long

12. Heat Oil With Steam  Original PVT and revised PVT on right –Oil viscosity drops from 71 cp to 13 cp at the bubble point  6 fold increase in rate through viscosity reduction

13. Temperature Sensitivity – 160 acres Vertical well [=] blue, vertical well + 180F, green 4 fold increase in recovery!

14. Temperature Sensitivity – 160 acres Horizontal well [=] blue, horizontal well + 180F, green 10 fold increase in recovery!

15. Horizontal Well Versus Vertical Well +Steam Both scenarios have similar profiles Perhaps as alternative to steam horizontal well technology may be feasible (if vertical permeability sufficient)

16. Closing Comments  A base model can be built and history matched  A series of sensitivity models can be created to understand the best drilling and completion strategy for a field  Screening models are adequate for ranking prospects and determining potential recovery factors and well drilling/completion strategies  More precise thermal project design requires a true thermal simulator and this is recommended for the final field design –Suggest CMG Stars simulator –This work will be an order of magnitude more expensive than the screening studies and take far longer