Outline

1. Successful, Proactive Managed Pressure Drilling Application Brought Added Value for Extreme Narrow Operating Windows in a 10 5/8-in x 12 1/4–in Hole Section in Southern Mexico

2. Outline • Field Information • Details • Remarkable Aspects • Objectives • The Solution • MPD Strategy • MPD Plan • Execution Phase • Results • Conclusions

3. Costero Field Information • The field is located in Southern Region of Mexico in the municipality of Centla, Tabasco, at 17 km northeast from the Frontera city. • Discovered in 1992 • Producer of wet and sour gas and light oil from Medium Cretaceous at 5700 TVD).

4. Well Geometry 26” @ 1000 m TVD 20” CSG 94.0 lb/ft, K-55, BTC, 0 – 400 m 20” 106.5 lb/ft, K-55, BTC, 400 – 1000 m 17-1/2” @ 2500 m TVD 13 3/8” CSG 72.0 lb/ft, P-110, BTC, 0 – 1100 m 13 3/8” CSG 72.0 lb/ft, TAC -110, BTC, 1100 – 2500 m 12-¼”4,920 m TVD 9-5/8” CSG 53.5 #P-110 VAM SLIJ II (0 – 3,200 m) 9-5/8” CSG 53.5 # TAC 140 VAM SLIJ II (3,200 – 4,920 m) 8-1/2” @ 5444 TVD / 5457 MD Liner: 7” 38 lb/ft, TAC-140, VAM SLIJ-II, 4720-5457 m STUB: 7 5/8” 39 lb/ft, TAC-140, VAM SLIJ-II, 2500-4720 m Tie-Back: 7 5/8” 39 lb/ft, TRC-95, VAM SLIJ-II, 0-2300 m 7 5/8” 39 lb/ft, TRC-110, VAM SLIJ-II, 2300-2500 m 5 5/8” @ 5864 TVD / 5896 MD Liner 4 1/2” (Solid + Slotted + Inflatable Packers) 13.5 lb/ft, TAC-140 VAMTOP, 5257-5896 m

5. Details The 12 1/4-in hole is an intermediate section that is normally drilled in a conventional way; however, due to NPT-generated gas influx problems at the beginning of the section and fluid loss conditions when the control mud density was attained, it became necessary to use the MPD technique to solve these operational problems.

6. Remarkable Aspects • The well condition was atypical; the maximum mud density used in offset wells for same depth in 12 1/4-in hole section has been around 1.99 g/cc. • No well has presented influxes to this depth (2,989 m). • During the drilling of the first 260 m in this 12 1/4-in hole, an accumulative mud loss of 114 m3 was observed.

7. Objectives • To drill 10-5/8-in x 12-1/4-in hole section, overcoming abnormal pressure behavior shown, compared with the other offset wells drilled in the same field. • The well flows in static condition and loses in dynamic condition, even with low frictional losses.

8. The Solution • Managed Pressure Drilling • Maintaining a constant bottomhole pressure at all times during operation • IADC Well Classification 5-A5

9. The Solution To provide the flexibility to dynamically handle the annular pressure controls, and it facilitates drilling or circulation of influxes; it also mitigates risks, allowing for quick action and for the reduction of nonproductive time associated with unexpected pressure variations

10. MPD Strategy • MPD technique used to avoid and/or securely handle formation influxes. Any incidental influx in the operation may be securely contained using an appropriate process. • The flexibility to dynamically manage the annular pressure facilitates the control during drilling and circulation of influxes, reducing unproductive time associated with variations in unforeseen pressure situations.

11. MPD Plan • The plan was to start drilling with 2.08 g/cc of fluid density, which would have a statically underbalanced condition, but it will be in balance with dynamic pore pressure during all drilling operations. • The annular friction losses will be replaced by the MPD choke, so that ESD will be maintained between 2.11 and 2.12 g/cc.

12. Conventional Vs. MPD The pressure at surface is atmospheric 1. Static Well (Mud Pumps “Off”) Static Pressure Gradient 2. Dynamic Well , With Flow (Mud pumps “On”) Depth Dynamic Pressure Gradient Pore Pressure Fracture Gradient Frictional Losses Pressure

13. Conventional Vs. MPD ¿How do it conventionally – NMWW 1. Static Well (Mud Pumps “Off”) Static Pressure Gradient Depth 2. Dynamic Well , With Flow (Mud pumps “On”) Dynamic Pressure Gradient Pore Pressure Fracture Gradient Lost of Circulation!!!!! Pressure

14. Conventional Vs. MPD Solution: MPD with CBHP – NMWW 1. Static Well (Mud Pumps “Off”) Static Pressure Gradient Depth 2. Dynamic Well , With Flow (Mud pumps “On”) Dynamic Pressure Gradient Pore Pressure Fracture Gradient Constant Bottom Hole Pressure All the Time Pressure

15. Effect of Adding Backpressure at Surface 0 6XX m 11-3/4” Contingency Casing Gas Bearing Shale TV Depth 10-5/8” x 12 ¼” Hole Section Fracture Gradient Drilling window Pore Pressure

16. MPD Equipment Process Flow Diagram

17. Simplyfied MPD Equipment Process Flow Diagram Standpipe Mud Pumps Shakers Rotating Head Primpay Line Mud Pits BOP Stack Flare Stack MPD Choke Manifold Return Line to Shakers

18. MPD Control Matrix Followed

19. Kill Line Circulation and Backpressure During POOH

20. MPD Daily Chart, October 20, 2009

21. MPD Daily Chart, October 22, 2009

22. Results • The well was drilled finding the balance between upper gas zones and lower weak zones. • Due to the high rheology of the mud, use of MPD equipment was mandatory during POOH and while tripping, in order to avoid swabbing and surge effects. • Before the client takes decision to use MPD spent 16 days trying conventional.

23. Results • During the POOH operation to change the BHA or bit, a procedure was carried out to maintain bottomhole pressure via a heavy pill pumped at the shoe. • Thanks to the MPD application the upper gas zone was drained while the well was drilled, mitigating losses.

24. Results • Application of the MPD technique was essential because the only other well drilled by the customer in same cluster was lost. • The application of MPD was initiated after trying to drill the well conventionally with 2.02 g/cc mud, increasing up to 2.12 g/cc. However, the initial attempts were unsuccessful and only 252-m could be drilled conventionally but with 114 m3 of mud losses.

25. Thank YouQuestions?