Statoil's shale interests in Northern Australia

Pål Haremo Vice President Exploration SEAAOC Darwin 21 August 2014

2014-08-07 Classification: Internal

Copyright©Statoil 2012.10.23 RDI Beijing: Recriutment campaign / 5

License overview

3

304 km

Seismic Lines Pre 2013

Seismic Lines acq 2013, 304 km

2014 Drilling Program

Drilling Operations Oz-Alpha-1

2014-02-07 4 Classification: Internal

5 2013-11-16 Classification: Internal

HSE Overview

Statistics:

• Total Man hours 148 000

• Total flights 94

• Land transport (km) 150 000

• Safety Inductions 262

Incidents;

• First Aid Cases 3

• Equipment Damage 8

• Environment 3 minor spills

No Serious Incidents

2014-02-10 6 Classification: Internal

Select well site

location

Apply for CLC Sacred

Site Clearance

Certificate and notify

pastoralist

Drilling Approval Process

Commission

environmental study

and archaeological

study

Submit application to

drill including drilling

program and

environmental

management plan

Revise application to

meet specific

requirements of the

DME

Receive approval and

submit EMP summary

for publication on

DME website

Conduct operations

and submit daily

report to DME

Complete drilling and

submit application to

plug and abandon

Receive approval and

conduct

abandonment

operations

Submit well

completion report

Rehabilitate site and

commission report on

rehabilitation

Submit rehabilitation

report and receive

security bond refund

Main risks

• Risk 1; Operational Logistics – Road Transport

• Risk 2; Operational Logistics – Air transport

Main mitigations

• Mitigation 1; ERP,Statoil Australia driving policy,

Outback Logistics Journey management, Satellite

phones, Experienced Contractors , Risk

consiousness

• Mitigation 2; Flight safety equipment operated by

trained personnel. Compliance to internal

requirements and CASA standards. Accredited

Flight operators approved by Statoil Flight Safety

group.

2014-05-16 7 Classification: Internal

Managing logistics

Operational status so far: Excellent performance

2014-04-26 8 Classification: Internal

• US Onshore Knowledge transfer

(Unconventionals)

• Local lessons learned incorporated

• Procurement achievements record time

• Project schedule on track

• Statoil / DME relationship

• More than 121k man hours (June16th)

• Close costs control / daily monitoring

SGB 2014 wells: data collection program

2014-01-21 9 Classification: Internal

Information type Method

Presence of movable oil Single stage small scale flow test (1-3 wells)

Stress/fraccability Stress test (incl. DFIT)

Rock mechanics on core

Mineralogy from core (XRD)

Wireline logs

Permeability System permeability: DFIT (max 3 wells)

Core analysis (challenging!)

STOOIP / Pay zone Core analysis (porosity, saturation)

Wireline logs

Oil quality PVT of test oil (if possible)

Geochemical analysis of oil and core extracts

Source quality / maturity Core analysis

• Wells will be selected for testing (DFIT, stress, production) based on:

− Presence of oil in core (visual, core data, petrophysics)

− Adequate reservoir properties (core data, petrophysics)

− Production test dependent on DFIT results

2014-06-16 10 Classification: Confidential

Core under white and ultraviolet light

Core data Core under white and

UV light

Image Log

2014-05-15 11 Classification: Internal

Analysis of the Image logs gives information regarding the horizontal stress directions

Breakout (WNW-ESE)

High confidence

20cm

Testing

• More than sufficient vertical distance to Potable

Water

• Frac Gradient 0,95 psi/ft

• Frac Height 107 m

• Propped Lenght 60 m

• Fluid volume > 600 Barrels

• Prod Testing 12 days

2014-08-07 12 Classification: Internal

> 1000m

Presentation title

Presenters name

Presenters title

E-mail address ……@statoil.com

Tel: +4700000000 www.statoil.com

2014-08-07 13 Classification: Internal