ARES ENERGY, LTD. SDI Survey Report. Fuhrman-Mascho Andrews County, Texas (Grid North) University 13 #2H VH - Job # KW-204.

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1 ARES ENERGY, LTD. Fuhrman-Mascho Andrews County, Texas (Grid North) University 13 #2H VH - Job # KW-204 Survey: Gyro SDI Survey Report 17 February, 2014

2 SDI SDI Survey Report Company: ARES ENERGY, LTD. Local Co-ordinate Reference: Well University 13 #2H Project: Fuhrman-Mascho TVD Reference: Mean Sea Level (System) Site: Andrews County, Texas (Grid North) MD Reference: Mean Sea Level (System) Well: University 13 #2H North Reference: Grid Wellbore: VH - Job # KW-204 Survey Calculation Method: Minimum Curvature Design: VH - Job # KW-204 Database: EDM-Regulatory Project Fuhrman-Mascho Map System: Geo Datum: Map Zone: US State Plane 1927 (Exact solution) NAD 1927 (NADCON CONUS) Texas North 4201 System Datum: Mean Sea Level Site Andrews County, Texas (Grid North) Site Position: From: Position Uncertainty: Lat/Long 0.0 usft Northing: -622, usft Easting: 1,629, usft Slot Radius: 13-3/16 " Latitude: Longitude: Grid Convergence: 32 17' N ' W Well University 13 #2H, Horizontal Well Position Position Uncertainty +N/-S +E/-W 0.0 usft 0.0 usft 0.0 usft Northing: Easting: Wellhead Elevation: -658, usft 1,643, usft 0.0 usft Latitude: Longitude: Ground Level: 32 11' N ' W 0.0 usft Wellbore VH - Job # KW-204 Magnetics Design Model Name Sample Date Declination Dip Angle Field Strength (nt) IGRF2010 2/12/ ,447 VH - Job # KW-204 Audit Notes: Version: 1.0 Phase: ACTUAL Tie On Depth: 0.0 Vertical Section: Depth From (TVD) +N/-S +E/-W Direction Survey Program Date 2/17/2014 From To Survey (Wellbore) Tool Name Description ,661.0 Gyro (VH - Job # KW-204) Keeper Keeper Survey MD Inc Azi (azimuth) TVD N/S E/W Closure Azimuth Closure Distance , , , , /17/2014 8:34:39PM Page 2 COMPASS Build 70

3 SDI SDI Survey Report Company: ARES ENERGY, LTD. Local Co-ordinate Reference: Well University 13 #2H Project: Fuhrman-Mascho TVD Reference: Mean Sea Level (System) Site: Andrews County, Texas (Grid North) MD Reference: Mean Sea Level (System) Well: University 13 #2H North Reference: Grid Wellbore: VH - Job # KW-204 Survey Calculation Method: Minimum Curvature Design: VH - Job # KW-204 Database: EDM-Regulatory Survey MD Inc Azi (azimuth) TVD N/S E/W Closure Azimuth Closure Distance 1, , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , /17/2014 8:34:39PM Page 3 COMPASS Build 70

4 Project: Fuhrman-Mascho Andrews County, Texas (Grid North) Well: University 13 #2H Wellbore: VH - Job # KW-204 Design: VH - Job # KW-204 WELL DETAILS: University 13 #2H Mean Sea Level (System) Ground Level: 0.0 +N/-S +E/-W Northing Easting Latittude Longitude Slot ' N ' W G T M Azimuths to Grid North True North: 0.67 Magnetic North: 7.48 Magnetic Field Strength: snT Dip Angle: Date: 2/12/2014 Model: IGRF South(-)/North(+) (10 usft/in) West(-)/East(+) (10 usft/in) PROJECT DETAILS: Fuhrman-Mascho SITE DETAILS: Andrews County, Texas (Grid North) Geodetic System: US State Plane 1927 (Exact solution) Site Centre Latitude: 32 17' N Datum: NAD 1927 (NADCON CONUS) Longitude: ' W Ellipsoid: Clarke 1866 Positional Uncertainity: 0.0 Zone: Texas North 4201 Convergence: System Datum: Mean Sea Level Local North: Grid

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7 Location: Field: Facility: ARES Energy Ltd. Andrews County, TX (University) Sec 13, Blk 10 University 13-2H Slot: Well: Wellbore: No. 2H SHL No. 2H No. 2H PWB Scale 1 inch = 400 ft Easting (ft) No. 2H SHL Tie On : ft TVD, ft S, 63.12ft E End of Tangent : ft TVD, ft S, 68.14ft E BGGM ( to ) Dip: Field: nt Magnetic North is 6.91 degrees East of True North (at 1/14/2014) Grid North is 2.81 degrees West of True North To correct azimuth from True to Grid add 2.81 degrees To correct azimuth from Magnetic to Grid add 9.72 degrees EOC : ft TVD, ft S, ft E TL : ft TVD, ft S, ft E Design Comment Tie On End of Tangent EOC TL No.2H PBHL Plot reference wellpath is Rev-F.0 MD (ft) Inc True vertical depths are referenced to Rig on No. 2H SHL (RT) Measured depths are referenced to Rig on No. 2H SHL (RT) Rig on No. 2H SHL (RT) to Mean Sea Level: 3194 feet Mean Sea Level to Mud line (At Slot: No. 2H SHL): feet Coordinates are in feet referenced to Facility Center Az Well Profile Data TVD (ft) Grid System: NAD27 / Lambert Texas SP, North Central Zone (4202), US feet North Reference: Grid north Scale: True distance Depths are in feet Local N (ft) Created by: gentbry on 2/17/2014 Local E (ft) DLS ( /100ft) VS (ft) Northing (ft) No.2H PBHL : ft TVD, ft S, ft E No. 2H PBHL 330' Hard Line True Vertical Depth (ft) Scale 1 inch = 400 ft Tie On : Inc, ft MD, ft TVD, ft VS End of Tangent : Inc, ft MD, ft TVD, ft VS /100ft EOC : Inc, ft MD, ft TVD, ft VS TL : Inc, ft MD, ft TVD, ft VS No. 2H PBHL No.2H PBHL : Inc, ft MD, ft TVD, ft VS Vertical Section (ft) Azimuth with reference 0.00 N, 0.00 E Scale 1 inch = 400 ft

8 Actual Wellpath Report No.2H AWP Page 1 of 4 REFERENCE WELLPATH IDENTIFICATION Operator ARES Energy Ltd. Slot No. 2H SHL Area Andrews County, TX Well No. 2H Field (University) Sec 13, Blk 10 Wellbore No.2H AWB Facility University 13-2H Sidetrack from No. 2H AWB (Pilot) at MD REPORT SETUP INFORMATION Projection System NAD27 / Lambert Texas SP, North Central Zone (4202), Software System WellArchitect US feet North Reference Grid User Gentbry Scale Report Generated 2/20/2014 at 9:13:23 AM Convergence at slot 2.81 West Database/Source file MidlandDB/No.2H_AWB.xml WELLPATH LOCATION Local coordinates Grid coordinates Geographic coordinates North East Easting Northing Latitude Longitude Slot Location '05.898"N '56.855"W Facility Reference Pt '05.898"N '56.855"W Field Reference Pt '07.574"N '55.159"W WELLPATH DATUM Calculation method Minimum curvature Rig on No. 2H SHL (RT) to Facility Vertical Datum 0.00ft Horizontal Reference Pt Facility Center Rig on No. 2H SHL (RT) to Mean Sea Level ft Vertical Reference Pt Rig on No. 2H SHL (RT) Rig on No. 2H SHL (RT) to Mud Line at Slot (No. 2H SHL) 0.00ft MD Reference Pt Rig on No. 2H SHL (RT) Section Origin N 0.00, E 0.00 ft Field Vertical Reference Mean Sea Level Section Azimuth

9 Actual Wellpath Report No.2H AWP Page 2 of 4 REFERENCE WELLPATH IDENTIFICATION Operator ARES Energy Ltd. Slot No. 2H SHL Area Andrews County, TX Well No. 2H Field (University) Sec 13, Blk 10 Wellbore No.2H AWB Facility University 13-2H Sidetrack from No. 2H AWB (Pilot) at MD WELLPATH DATA (92 stations) MD Inclination [ ] Azimuth [ ] TVD Vert Sect North East Grid East Grid North Latitude Longitude DLS Comments [ /100ft] '05.898"N '56.855"W '05.899"N '56.855"W '05.900"N '56.857"W '05.899"N '56.863"W '05.897"N '56.870"W '05.894"N '56.875"W '05.890"N '56.876"W '05.886"N '56.878"W '05.883"N '56.879"W '05.880"N '56.881"W '05.877"N '56.883"W '05.873"N '56.884"W '05.870"N '56.886"W '05.866"N '56.889"W '05.862"N '56.891"W '05.859"N '56.893"W '05.856"N '56.893"W '05.855"N '56.891"W '05.854"N '56.890"W '05.854"N '56.883"W '05.851"N '56.868"W '05.847"N '56.849"W '05.841"N '56.828"W '05.835"N '56.806"W '05.830"N '56.783"W '05.826"N '56.756"W '05.827"N '56.724"W '05.829"N '56.690"W '05.831"N '56.657"W '05.833"N '56.630"W '05.835"N '56.608"W '05.835"N '56.587"W '05.835"N '56.566"W '05.833"N '56.544"W '05.831"N '56.520"W '05.831"N '56.499"W '05.833"N '56.479"W '05.836"N '56.457"W '05.840"N '56.432"W '05.845"N '56.406"W 0.12 Tie On '05.844"N '56.387"W '05.833"N '56.377"W '05.804"N '56.364"W '05.751"N '56.346"W '05.676"N '56.325"W 16.01

10 Actual Wellpath Report No.2H AWP Page 3 of 4 REFERENCE WELLPATH IDENTIFICATION Operator ARES Energy Ltd. Slot No. 2H SHL Area Andrews County, TX Well No. 2H Field (University) Sec 13, Blk 10 Wellbore No.2H AWB Facility University 13-2H Sidetrack from No. 2H AWB (Pilot) at MD WELLPATH DATA (92 stations) MD Inclination [ ] Azimuth [ ] TVD Vert Sect North East Grid East Grid North Latitude Longitude DLS Comments [ /100ft] '05.571"N '56.299"W '05.441"N '56.269"W '05.298"N '56.236"W '05.136"N '56.202"W '04.965"N '56.166"W '04.774"N '56.126"W '04.577"N '56.082"W '04.359"N '56.031"W '04.129"N '55.973"W '03.895"N '55.908"W '03.642"N '55.835"W '03.379"N '55.761"W '03.116"N '55.691"W '02.835"N '55.621"W '02.547"N '55.549"W '02.255"N '55.472"W '01.968"N '55.393"W '01.668"N '55.310"W '01.365"N '55.226"W '01.060"N '55.143"W '00.763"N '55.065"W '00.455"N '54.985"W '59.847"N '54.825"W '59.240"N '54.661"W '58.622"N '54.494"W '58.015"N '54.329"W '57.410"N '54.154"W '56.798"N '53.961"W '56.197"N '53.765"W '55.597"N '53.568"W '54.996"N '53.372"W '54.386"N '53.173"W '53.785"N '52.979"W '53.183"N '52.788"W '52.581"N '52.599"W '51.978"N '52.410"W '51.376"N '52.220"W '50.765"N '52.023"W '50.164"N '51.829"W '49.562"N '51.639"W '48.949"N '51.451"W '48.345"N '51.270"W '47.741"N '51.090"W '47.147"N '50.910"W '46.543"N '50.728"W 0.51

11 Actual Wellpath Report No.2H AWP Page 4 of 4 REFERENCE WELLPATH IDENTIFICATION Operator ARES Energy Ltd. Slot No. 2H SHL Area Andrews County, TX Well No. 2H Field (University) Sec 13, Blk 10 Wellbore No.2H AWB Facility University 13-2H Sidetrack from No. 2H AWB (Pilot) at MD WELLPATH DATA (92 stations) MD Inclination [ ] Azimuth [ ] TVD Vert Sect North East Grid East Grid North Latitude Longitude DLS Comments [ /100ft] '46.150"N '50.611"W '45.632"N '50.457"W 0.00 Proj to Bit TARGETS Name No. 2H PBHL MD TVD North East Grid East Grid North Latitude Longitude Shape '45.663"N '50.316"W point WELLPATH COMPOSITION - Ref Wellbore: No.2H AWB Start MD Ref Wellpath: No.2H AWP Positional Uncertainty Model Log Name/Comment Wellbore End MD Generic gyro - northseeking (Standard) Scientific Gyros < > No. 2H AWB (Pilot) NaviTrak (Standard) BHI MWD NaviTrak <3972-XXXX> No.2H AWB Blind Drilling (std) Projection to bit No.2H AWB

12 2105 MARKET STREET MIDLAND, TX HR (432) STATE OF TEXAS COUNTY OF I, Charles Moore, Directional Driller certify that I am employed by Baker Hughes INTEQ; did conduct or supervise on the day(s) of 02/13/2014 through 02/20/2014 taking of MWD surveys from a depth of 3972 to a depth of 6289 the that the data is true, correct, complete and within the limitations of the tool as set forth by Baker Hughes INTEQ ; that I am authorized and qualified to make this report; that this survey was conducted at the request of Ares Energy for the University 13 No. 2H Well, API No in ANDREWS County, TX; and that I have reviewed this report and find that it conforms to the principles and procedures as set forth by INTEQ. Field Service Engineer: Charles Moore

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