Innovative Formate Brines in HPHT Drilling: Milestones and Success Stories

1. Formate brines – Some published milestones 2005 -2010 Saudi Aramco start using K formate to drill and complete (with ESS) in HPHT gas wells OMV Pakistan start using K formate to drill and complete (with ESS) in HPHT gas wells Petrobras use K formate brine for open hole gravel packs in Manati field First of 12 completions in the Kashagan field with K/Cs formate First MPD operation in Kvitebjørn with K/Cs formate “designer fluid” Gravel pack with K formate brine in Statfjord B Total’s West Franklin F9 well (204oC) perforated in K/Cs formate brine 2005 2006 2007 2008 2009 2010 K/Cs formate brines used as well perforating fluids in 11 HPHT gas fields in UK North Sea : Dunbar, Shearwater, Elgin, Devenick , Braemar , Rhum, Judy , Glenelg , Kessog , Jura and West Franklin 1999-2011 Potassium formate from Addcon

2. Saudi Aramco have been drilling HPHT gas wells with potassium formate brine since 2003 Potassium formate from Addcon

3. Saudi Aramco use of formate brines, 2003-2009 • 7 deep gas fields • 44 HPHT wells drilled • 70,000 ft of reservoir drilled at high angle • 90,000 bbl of brine recovered and re-used • Good synergy with ESS, also OHMS fracturing Potassium formate from Addcon

4. Summary from Aramco’s OTC paper 19801 Potassium formate from Addcon

5. Pakistan - OMV use potassium formate brine for HPHT deep gas well drilling and completions Potassium formate from Addcon

6. Extracts from OMV’s SPE papers and SPE presentations – note1,700 psi overbalance, and 350oF Potassium formate from Addcon

7. North Sea - K/Cs formate brines used as combined HPHT drill-in and completion fluids 33 development* wells drilled and completed in 7 HPHT offshore gas fields • Huldra (6 ) • Tune (4) • Devenick (2) • Kvitebjoern (8 O/B and 5 MPD) • Valemon (1) • Kristin (2) – Drilled only • Vega (5) * Except Valemon (appraisal well) Mostly open hole stand-alone sand screen completions Potassium formate from Addcon

8. Tune field – HP/HT gas condensate reservoir drilled and completed with K formate brine, 2002 4 wells : 350-900 m horizontal reservoir sections. Open hole screen completions. Suspended for 6-12 months in formate brine after completion Potassium formate from Addcon

9. Tune wells - Initial Clean-up – Operator’s view (direct copy of slide) June 2003 • Wells left for 6-12 months before clean-up • Clean-up : 10 - 24 hours per well • Well performance • Qgas 1.2 – 3.6 MSm3/d • PI 35 – 200 kSm3/d/bar • Well length sensitive • No indication of formation damage • Match to ideal well flow simulations (Prosper) - no skin • Indications of successful clean-up • Shut-in pressures • Water samples during clean-up • Formate and CaCO3 particles • Registered high-density liquid in separator • Tracer results • A-12 T2H non detectable • A-13 H tracer indicating flow from lower reservoir first detected 5 sd after initial clean-up <-> doubled well productivity compared to initial flow data • No processing problems Oseberg Field Center Potassium formate from Addcon

10. Tune – Production of recoverable gas and condensate reserves since 2003 (NPD data) • Good early production from the 4 wells • - No skin (no damage) • - 12.4 million m3 gas /day • - 23,000 bbl/day condensate • Good sustained production • - 90% of recoverable hydrocarbon • reserves produced by end of Year 7 • NPD current estimate of RR: • - 18.3 billion m3 gas • - 3.3 million bbl condensate • Rapid and efficient drainage of the reservoir Potassium formate from Addcon

11. Huldra field – HPHT gas condensate reservoir drilled and completed with K/Cs formate brine, 2001 • 6 production wells • 1-2 Darcy sandstone • BHST: 147oC • TVD : 3,900 m • Hole angle : 45-55o • Fluid density: SG1.89-1.96 • 230-343 m x 81/2” reservoir sections • Open hole completions, 65/8” wire wrapped • screens • Lower completion in formate drilling fluid and • upper completions in clear brine Potassium formate from Addcon

12. Huldra – Production of recoverable gas and condensate reserves since Nov 2001 (NPD data) • Plateau production from first 3 wells • - 10 million m3 gas /day • - 30,000 bbl/day condensate • Good sustained production • - 78% of recoverable gas and 89% of • condensate produced by end of Year 7 • - Despite rapid pressure decline..... • NPD current estimate of RR: • - 17.5 billion m3 gas • - 5.1 million bbl condensate • Rapid and efficient drainage of the reservoir Potassium formate from Addcon

13. Kvitebjørnfield – HPHT gas condensate reservoir drilled and completed with K/Cs formate brine, 2004-2013 • 13 wells to date – 8 O/B, 5 in MPD mode • 100 mD sandstone • BHST: 155oC • TVD : 4,000 m • Hole angle : 20-40o • Fluid density: SG 2.02 for O/B • 279-583 m x 81/2” reservoir sections • 6 wells completed in open hole : 300-micron single wire-wrapped • screens. • Remainder of wells cased and perforated Potassium formate from Addcon

14. A few of the highlights from Kvitebjoern Fast completions and high well productivity Operator comments after well testing (Q3 2004 ) “The target well PI was 51,000 Sm3/day/bar This target would have had a skin of 7” “A skin of 0 would have given a PI of 100,000” “THE WELL A-04 GAVE A PI OF 90,000 Sm3/day/bar (ANOTHER FANTASTIC PI)” The Well PI was almost double the target * Fastest HPHT well completion in the North Sea Potassium formate from Addcon

15. Kvitebjørn– Production of recoverable gas and condensate reserves since Oct 2004 (NPD data) • Good production reported from first 7 wells in 2006 - 20 million m3 gas /day • - 48,000 bbl/day condensate • Good sustained production (end Y8) • - 37 billion m3 gas • - 17 million m3 of condensate • - Produced 70% of original est. RR by • end of 8th year • NPD : Est. RR have been upgraded • - 89 billion m3 gas (from 55) • - 27 million m3 condensate (from 22) • Note : Shut down 15 months, Y3-5 • - To slow reservoir pressure depletion • - Repairs to export pipeline Potassium formate from Addcon

16. Economic benefits of using formate brines • SPE 130376 (2010): “A Review of the Impact of the Use of Formate Brines on the Economics of Deep Gas Field Development Projects” • SPE 145562 (2011): “Life Without Barite: Ten Years of Drilling Deep HPHT Gas Wells With Cesium Formate Brine” Potassium formate from Addcon

17. Economic benefits from using formate brines - Good well performance and recovery of reserves • “High production rates with low skin” * • “ We selected formate brine to minimise well control problems and maximise well productivity”* * Quotes by Statoil relating to Kvitebjoern wells (SPE 105733) Potassium formate from Addcon

18. Economic benefits from using formate brines - More efficient and safer drilling • Better/safer drilling environment saves rig-time costs • Stable hole: see LWD vs. WL calipers in shale • Elimination of well control* and stuck pipe • incidents • Good hydraulics, low ECD • Good ROP in hard abrasive rocks • * See next slide for details “ a remarkable record of zero well control incidents in all 15 HPHT drilling operations and 20 HPHT completion operations” Potassium formate from Addcon

19. Economic benefits from using formate brines - Improved well control and safety • Elimination of barite and its sagging problems • Elimination of oil-based fluids and their gas solubility problem • Low solids brine  Low ECD (SG 0.04-0.06) and swab pressures • Inhibition of hydrates • Ready/rapid surface detection of well influx • Elimination of hazardous zinc bromide brine Potassium formate from Addcon

20. Economic benefits from using formate brines - More efficicient/faster completions • - Drill-in and completing with • formate brine allows open hole • completion with screens • - Clean well bores mean no tool/seal • failures or blocked screens • - Completion time 50% lower than • wells drilled with OBM • “ fastest HPHT completion operation ever performed in North Sea (12.7 days)” Potassium formate from Addcon

21. Economic benefits from using formate brines - Operational efficiencies Flow check fingerprint for a Huldra well • No differential sticking • Pipe and casing running speeds are fast • Mud conditioning and flow-check times are short • Displacements simplified, sometimes eliminated Potassium formate from Addcon

22. Economic benefits from using formate brines - Good reservoir definition if Cs present in fluid • High density filtrate and no barite • Filtrate Pe up to 259 barns/electron • Unique Cs feature - makes filtrate invasion • highly visible against formation Pe of 2-3 b/e • LWD can “see” the filtrate moving (e.g. see • the resistivity log on far right – drill vs ream • Good for defining permeable sands (see • SAND-Flag on log right ) • Consistent and reliable net reservoir definition • from LWD and wireline Potassium formate from Addcon

23. Economic benefits from using formate brines - Good reservoir imaging • Highly conductive fluid • Clear resistivity images • Information provided: • - structural dip • - depositional environment • - geological correlations Potassium formate from Addcon

24. Formate brines – Summary of economic benefits provided to users Formate brines tend to improve oil and gas field development economics by : • Reducing well delivery time and costs • Improving well/operational safety and reducing risk • Maximising well performance • Providing more precise reservoir definition Potassium formate from Addcon

25. Formate brines as packer fluids in GOM Potassium formate from Addcon

26. BP High Island – Na/K formate brine as packer fluid for 6 years • 177ºC, 14,000 psi • S13Cr tubing failed from CaCl2 packer fluid • Well worked over and re-completed with Cs formate • 1.4 g/cm3 Na/K formate used as packer fluid • Tubing retrieved 6 years later • Tubing was in excellent condition. Potassium formate from Addcon