eCORP Stimulation Technologies, LLC (ecorpStim) Pure Propane (PPS) - PowerPoint PPT Presentation

eCORP Stimulation Technologies, LLC (ecorpStim) Pure Propane (PPS) and Non-Flammable Propane (NFP) Stimulation of Shale Presented by John Francis Thrash, CEO October 9 th 2014 Paris, France

Overview Water Based Hydraulic Fracturing (HF) – Today, commonly employed formulations for hydraulically fracturing source rocks include the use of massive quantities of water in mixture with a variety of chemical additives combined with various proppant materials which are injected under high pressure into the rock formations. After stimulation there is an attempt to recover the water, chemicals and dissolved reservoir content from the newly established fracture system in the rock. Perceived Risks – All of these basic features of the process, as routinely practiced today, are sometimes associated with real and potential environmental and safety hazards as well as variable performance outcomes in certain instances. Infrastructure Limitations – This standard technology can present profound logistical challenges in a number of the newly evolving basins around the planet where there maybe water and infrastructure limitations, extremely cold climes or other conditions not previously routinely encountered in the North American shale experience. Pure Propane Stimulation (PPS) – A simple binary system of propane, butane or similar lightweight hydrocarbon, used in combination with man-made proppants of specifically designed dimensions and densities. The list of routinely encountered impacts associated with water-based HF obviated by PPS is very nearly complete. Flammability – Although propane is the third most frequent component of natural gas, and used in over 120 million households in Europe, the primary concern associated with its use in shale stimulation is flammability. This presentation discusses the science and techniques for safely utilizing PPS to stimulate production from shale source rocks, including the Non-Flammable Propane Stimulation (NFP) option and other safety features of the mechanical system, layout and operating protocols. Economics – The economics of these systems are discussed, in particular, when propane can be self- supplied by the operator once initial production has commenced.

Who is eCORP International, LLC Background

Background Who is eCORP International, LLC ?  eCORP is Headquartered in Houston, Texas with Offices Located in London, Paris, Madrid, Zurich and Sofia, Bulgaria  eCORP companies have been in business since 1978  eCORP has Closed Billions of USD in Successful Transactions & Developments  eCORP is a Privately Held Vertically Integrated Energy Company whose Primary Experiences Include:  Exploration & Production: Conventional and Unconventional  Natural Gas Storage and Pipelines  Enhanced Oil Recovery (EOR)  Specialized Field Services  Natural Gas Fired Power Generation

 Seeks to be First Mover, Innovative & Environmentally Sound  A Recognized as a Green/Low Environmental Impact Developer  A Developer of Novel and Successful Technical Solutions

Organizing Principles of eCORP – Safety and Environmental Care  Impeccable Safety Record in All Operations Since Inception  Zero Incidents with Propane (LPG) Operations for 35 Years  Commitment to Environmentally Sensitive Development Practices  Surface Aesthetics, Noise/Light Abatement, Infrastructure Impacts  Extensive Proactive Community Engagement  Maximize Cultural and Economic Benefit for the Community  Strive to Exceed Industry and Regulatory Standards  Innovate/Adapt Technology to Address Challenging Geologic and Reservoir Conditions while Maintaining Meticulous Environmental Care and Concern Today eCORP continues developments via positive interactions with regulators, legislatures, communities, NGO, virtually all stakeholders, in venues such as North America, and in such challenging states as New York, and in closed markets such as Mexico, as well as in Europe.

History Relevant to Pure Propane Stimulation Enhanced Oil Recovery (EOR)  Propane and Butane EOR Projects – Approx. 450 Well Development in Three Counties in South Texas  Miscible and Immiscible CO2 EOR Projects  Bio-Polymer EOR Project with Pfizer Oil Field Products  Largest Independent in EOR in Texas 1978 – 1988  Perfect Safety Record with Propane and Butane EOR  Trouble Free Operation of Propane / Butane Recycling

Natural Gas Storage and Pipelines  eCORP has been involved in Approximately 20% of New Storage Capacity Additions in the United States since Deregulation beginning in 1985  Salternatives TM Technology (horizontal well drilling and completion IP) and the Stuart Storage Facility, Stuart, Oklahoma 1991 – 2001  First All Horizontal Well Storage Development  Propane Stimulation / Clean-up of Storage Wells  Stagecoach Storage Facility 2002 – 2005  Nearest Storage to NYC / New England Gas Market  Most Productive Wells Drilled in the Lower 48 States  American Institute of Architecture (AIA) Award Winning / Environmental Design

Located Near Town of Owego New York State

Exploration & Production: Unconventional  eCORP Resource Partners I, LP was the 7 th Largest Non-Barnett US Shale Acreage Holder 2006 – 2008  Pioneer in US Shale: Example: Early 200,000 Acre Play in the Core of Marcellus Shale in Pennsylvania beginning in 2005  Closest Shale Well to New York City  eCORP Holds a Substantial Shale Acreage Position in Western Europe (> 1 Million Net Acreages) 2009 to Present

Specialized Field Services  ecorpStim (www.ecorpstim.com)  Launch of Pure Propane Stimulation (PPS) for Shale 2011  Key GasFrac Personnel Join ecorpStim 2012  Preliminary Field Testing of PPS 2012  Non-Flammable Propane Stimulation (NFP) Launched in 2013  Formation of the ecorpStim R&D Consortium 2014  eCORP subsidiary eCOREx founded 2011  Provides Minimal Discharge Micro-hole Coring Drilling for Rapid Inexpensive Evaluation of Hydrocarbon Reservoirs with Minimal Environmental Footprint and Impacts

Summary of Key eCORP History Relative the ecorpStim Proposition  Long History and Operating Experience with Propane (LPG) Stimulation in a Variety of Reservoir Settings  Perfect Safety Record with Propane (LPG) Stimulation Employed in eCORP Projects of All Kinds  Commitment to Innovation for the Preservation of the Environment  Extensive and Varied Shale Experience Internationally  Strong Track Record of Commercial Successes in Applying New Technologies Safety + Environmental Care + Propane History + Shale Experience = PPS and NFP

Challenges in the Stimulation of Shale Reservoirs

Challenges in the Stimulation of Shale Reservoirs  How can we get the Maximum Rates and Recoveries from Extremely Low Permeability Reservoirs?  Low Recovery Factors  How can we get the Maximum Effective Fracture Length from the Stimulation Process?  How do we Manage High Capillary Pressure Reservoirs  How do we Contend with Historically Low Frac-Water Recoveries (~20%) How can we Insure the Mechanical Fluid is Compatible with the Shale and Formation Fluids?  Easily Damaged Reservoirs – Swelling Clays, Imbibition, Water Blockage, etc.  Changes in the Strength of the Rock Facies?  How will we Minimize the Environmental Impact?  Water Usage  Disposal of Fracturing Fluids/Waste Streams  Venting/Flaring  How will we Achieve Safe Operations?

In Search of the “Perfect” Fluid?  Reservoir Performance  Non-Damaging (Water Blocks/Imbibition, Clay Swelling, Softening Formation, Scale, Emulsions, Gel Damage)  Create the Required Fracture Geometry  Effective Proppant Transport  Only Proppant Remains in the Fracture  100% Fluid Recovery  100% Fracture Volume Contributes to Production  Environmental & Economic Performance  No Chemicals Required to Modify the Mechanical Fluid  All Fluids Recovered are Marketable or Recyclable  Sustainability and Natural Substances)  Eliminate Water Usage, Disposal Needs, & CO 2 Venting  Operationally Safe  Injury and Accident Free Execution

Consider LPG Past Use in Reservoir Stimulation A 100% Compatible Stimulation Fluid Morris Muskat, Industrial and Engineering Chemistry, July 1953 “Laboratory experiments have demonstrated that complete removal of oil from a porous medium can readily be obtained by displacing it with the liquefied petroleum gases, propane, and butanes…” Koch & Slobod, SPE 714, Oct 1956 “Miscible phase displacement oil has been an intriguing idea because the elimination of capillary effects in the reservoir leads to 100% recovery in the areas contacted by the miscible displacing phase.” Roger Sessions, SPE 341, Jan 1963 “A number of laboratory tests with Slaughter crude indicates small propane slugs would efficiently displace 100% of the oil contacted in a sand packed column.”

Henderson, et. al., Petroleum Transactions 3501, Vol. 198, 1953 “A laboratory investigation of oil displacement from porous media by a liquefied petroleum gas.”

Thrash & Thrash, Oil World, Oct 1985 “Gaseous propane brings new life to field.”

Lestz et al, World Oil, July 2011 “Propane-based fracturing improves well performance in Canadian tight reservoirs.”