Workflow for Finding Bypassed Reserves in Mature Assets

1. Workflow for Finding Bypassed Reserves in Mature Assets • Real Time Integration of Simulation , Seismic Interpretation, and Geophysics • Best Answers Possible • Simulation matches dynamics • Geology matches statics and dynamics

2. Reality Today • Integration of Seismic, Geoscience and Reservoir Simulation Almost Never Applied • Not Practical • Work flow in each disciplines historically takes months to years • Answers needed in weeks to months to add value • A good answer on time is better than a perfect answer too late

3. Data Analysis System Requirements • Easy to Use Windows Based Mapping/Simulation Packages • Designed for all engineers • Not just the expert • Easy integration of geology • Apprentice mapping package • Interpretations for simulator in hours • User friendly simulation analysis system • Merlin - easy to use windows based pre / post processor • Quick results

4. Mapping Package Features Digitize maps with mouse or tablet

5. Mapping Package Features Import wizard to import maps from other programs

6. Mapping Package Features Flexible gridding

7. Data Analysis System Features PVT/Kr correlations Waterflood pattern models in minutes

8. Data Analysis System Features Place horizontal and vertical well trajectories with the mouse

9. Data Analysis System Features Contour maps and cross sections

10. Data Analysis System Features 3-D fences and fields

11. Data Analysis System Features Ternary colors

12. Evaluation of Mature Asset with Quantitative 3-D Seismic Gemini Solutions, Inc..

13. Objective: in partnership with Energy Outpost assess drilling prospects for the Mature Gulf Of Mexico Prospect

14. Introduction: 5 major sands investigated: Sand 1, Sand 2, Sand 3, Sand 4, Sand 5 Highly faulted and compartmentalized environment: a total of 52 reservoirs/fault blocks 24 reservoirs/fault blocks with production history and 29 wells/completions A total of 64 independent reservoirs/fault blocks initialized and simulated to arrive at final results.

15. Introduction (cont.): Reservoir models initialized on the basis of: - structure, gross thickness, net thickness, and porosity maps developed by Energy Outpost - available reservoir data from property/prospects files (PVT, well test, completion data, etc.) - assumption of relative permeability, and permeability All sands simulated on identical 53x46x3 variable size grid

16. Introduction (cont.): Reservoir history match performed for every fault block with production history, within the focus area. Reservoir history match results resolved with Energy Outpost interpretations (iterative process of model definition and enhancement). Final models used to approximate hydrocarbons in place for prospect areas, and to approximate recovery.

17. Sand 1 Sand Model Structure Map

18. Sand 1 Sand Model Net Thickness Map

19. Sand 1 Sand Model Region Definition Map 1 3 5 2 6 8 7 4

20. Sand 1 Sand Model Well History Match

21. Sand 1 Sand Model Saturation map at initialization

22. 1 3 5 2 6 8 7 4 Sand 1 Sand Model Results of modeling 6.4 BCF reserves in compartments 3, 5, 6

23. Sand 2 Sand Model Structure Map

24. Sand 2 Sand Model Net Thickness Map

25. 9 10 2 3 11 7 12 1 14 13 4 15 6 8 5 Sand 2 Sand Model Region Definition Map

26. Sand 2 Sand Model Well history match

27. Sand 2 Sand Model Oil Saturation map at initialization Simulation Identified Leaking Faults

28. Sand 2 Sand Model Gas Saturation map at initialization

29. 9 10 3 2 11 12 7 13 14 1 4 15 6 8 5 Sand 2 Sand Model Results of modeling 3.1 BCF reserves in 4 compartments

30. Sand 3 Sand Model Structure Map

31. Sand 3 Sand Model Net Thickness Map

32. 2 11 3 5 7 12 9 6 17 10 13 4 1 14 16 15 8 Sand 3 Sand Model Region Definition Map

33. Sand 3 Sand Model Oil Saturation map at initialization

34. Sand 3 Sand Model Gas Saturation map at initialization

35. 2 11 3 5 7 9 12 17 6 10 13 4 14 16 1 15 8 Sand 3 Sand Model Results of modeling 11.5 BCF , 2.2 MMBO reserves in 8 compartments

36. Sand 4 Sand Model Structure Map

37. Sand 4 Sand Model Net Thickness Map

38. 7 2 6 3 9 8 17 4 10 11 12 16 5 1 13 14 15 Sand 4 Sand Model Region Definition Map

39. Sand 4 Sand Model Saturation map at initialization

40. Sand 4 Sand Model Saturation map at initialization

41. Sand 4 Sand Model Results of modeling 7 2 6 3 9 8 17 4 10 11 16 12 5 14 1 13 15 3.8 BCF , 1.33 MMBO reserves in 5 compartments

42. Summary of results 27 BCF , 3.8 MMBO new reserves in 5 horizons

43. Conclusions: • Integration of quick simulation and geoscience interpretations allowed significant new reserves to be identified in a mature asset approaching the economic limit • Neither discipline could have identified all of these reserves • 64 fault compartments • history matched multiple times only in weeks • Maps generated quickly • days to weeks – not months to years