Changes in the Directional Drilling And Surveying Markets

1. Changes in the Directional Drilling And Surveying Markets

2. Introduction The purpose of this discussion is to update everyone with what is available in the market and give a general description on why and how this technology can assist you with your drill programs. It will cover the main items that you may run into, or be asked about, in the field today. • Surveying • Brief History – Starting years ago with Acid tests and standard film single shots, Canadian Drilling Contractors have been taking survey tests in drill holes to provide requested information to their clients. Over the past decade extreme changes have come about with the introduction of numerous new tools and suppliers. With these changes have come secondary survey methods, contractors who work solely in this market and some introduction of “in-house” divisions to handle these requests.

3. Types of instruments • Magnetic Survey Instruments – Single and Multishot Photographic Single and Multishots – Record a film record of a compass and gravity dip indicator at a drill hole depth to be read and recorded by the client. Useful tools but are being phased out due to easier to use electronic tools. Electronic Single and Multishots – These tools use a combination of accelerometers and magnetometers in conjunction with an electronic timer and on board memory to record azimuth and dip information. The ease of use and in some cases multiple functions of these tools makes them superior to film based units. Due to the on board sensors used it is also possible to determine and record the magnetic field intensity and dip to assist in determining if possible interference has been pick up in the reading.

4. Non Magnetic Survey Instruments • Gyros – These instruments use similar accelerometers to record dip but use a gyro which records deviation in the drill hole free from any interference caused by possible magnetics. The 3 main types in use in this market are • Mechanical Free Gyros • Rate Gyro Systems • North Seeking Gyro Systems • Other Options – Other commonly used tools in this category are based on curve measurement or light reflection area. As the tools pass along the drill string measurements are taken and movement is determined based on visible ring area or strain on instrument components. The main tool that fits into this category is the Reflex Maxibore. Recent introduction of a Devico Deviflex tool generates similar results and past Lightlog or Boretrack tools work on similar principles.

5. Several Companies are currently working on, or are in the testing phase on new non-magnetic survey instruments. Most are based on gyro principles and within the next 12 to 18 months. It is believed that some of these may be introduced that are sufficiently robust and operator friendly that Mining Companies and Drill Contractors may incorporate these into their operations or services. • List of Manufactures / Suppliers • Reflex Instruments * - Halliburton Sperry Sun * • International Directional Services * - Borinfo * • Ranger Survey Systems - Icefield Tools • Pajari - Flexit * indicates companies that supply both magnetic and non-magnetic survey tools. Note: I.D.S. and Borinfo are mainly service suppliers

6. Survey Summery With the speed at which the market is changing and with the introduction of new easier to use tools, it is believed your clients will start to request more information about these options. Most everything has benefits and some disadvantages so knowing your project and clients needs is key to selecting the proper tool, Supplier or Contractor. This will mean less down time for you and proper data for them. Federal requirements are starting to change and going forward it is believed due diligence in regards to survey data and hole location will take a larger role. Better to know your options than to be behind when the questions arrive.

7. Directional Drilling A self described definition of directional drilling is any drill hole that the contractor attempts to change or alter the azimuth or inclination of the drill hole through downhole assembly selections, wedging or directional drilling tools. Under this definition almost all drilling contractors have been required at some point to directional drill or control their drill holes. When these times arise, being prepared, planning, proper method selection, having the right know how, and incorporating these items will result in a smoother completion. This also assists in quicker, more cost effective completion of the total project.

8. Main Methods for Directional Drilling Bottom hole assembly selection -with the introduction of stabilized full hole barrels, longer reaming shells and better bit technology it is now easier to control a drill hole by setting parameters for crews to follow. This will not steer a hole in a particular direction but will assist in minimizing or using the formations natural tendencies. Not a new method but becoming more efficient. Directional Wedges or Retrievable Wedges -Directional wedges are used to cut off an existing hole and start a secondary hole. These can be set off bottom enabling the contractor to set up and correct if a hole is heading off line. Retrievable wedges are used when a client wants no steel left in the hole. These are set off bottom and need to be planned ahead of time to avoid allowing the hole to drift to far off line. These options are fairly common in the Canadian Drilling Industry and are handled almost exclusively by the drill contractors.

9. Positive Displacement Motors -Directional motors got their start in the oilfield years ago. For the past 15 to 20 years they have been available in sizes that are more common for the mining industry. This equipment uses a large amount of fluid to pass through a power section and transfer rotational power to the bit. In using fluid to rotate the bit the motor can then be manufactured with a bend and create side hole force to deviate drill holes. Over the last 5 years or so we have seen major changes to the power sections to provide more HP and bearing changes to avoid unnecessary wear. These have also benefited for better bit technologies and survey tools. This has allowed for easier use and more accurate control of doglegs and target requirements. Motor have been used throughout Canada and have controlled deflections past 2000m in depth. Because of these changes some drill contractors are electing to run this equipment on certain projects without the need for an outside contractor.

10. Devico Directional Corebarrels -This tool has been around since 1999 in a NQ wireline option. For the first few years it had some difficulties but has come a long ways and is now proving to be a reliable option for directional drilling. It works by utilizing two outer barrel and an inner tube to retrieve the core. When the water is pumped past the tool it expands a packer and disengages a locking pin which holds the outer barrel in place against the hole wall and allows the inner barrel to provide the rotation to the bit. The system is complicated and requires frequent repairs and cleaning as well as strict attention to pressures and variables. The system is available in standard form B and H sizes but requires the tool to be pulled from the hole every drill run. These tools may work similar to a retrievable wedge but for longer deflections would be labour intensive. This system can be run by contractors but requires personnel commitment and proper service planning to avoid breakdowns and delays.

11. List of Manufactures / Suppliers • International Directional Services • Major Drilling Group • Devico Directional Tools The above companies supply separate directional contracts and personnel to drilling companies or mining companies that require these services. Other Canadian drilling contractors have also used these tools to great success by using experienced supervisors and foreman to oversee these projects.

12. Additional Specialty Tools Core orientation tools, Directional Software and Hole Planning, Basic Geophysical Services As with most things specialty service companies are changing and more than every new tools and technologies will continue to be developed and offered to contractors to better their services.