PRESENTATION TITLE. Anti-Collision Best Practices Developed for Horizontal Drilling Across Preexisting. Erin Britton & Rachel Grande

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1 PRESENTATION TITLE Industry Steering Committee on Wellbore Survey Accuracy Developed for Horizontal Drilling Across Preexisting Wellbore Horizontal Positioning Technical Wellbores Section Erin Britton &

Speaker Information Erin Britton, Sr. Drilling Engineer Petroleum engineer with over 9 years energy industry experience specializing in drilling engineering with a focus in project management. Holds a B.S. in Petroleum Engineering from the University of Oklahoma and a Masters of Energy Business from the University of Tulsa. Experience across multiple basins & plays including extended reach and multilateral drilling projects. Industry Steering Committee on Wellbore Survey Accuracy, Sr. Geologist Geologist with over 9 years energy industry experience specializing in operational geology and field development. Holds a B.S. in Geological Sciences from Ball State University. Experience in multiple basins & plays including Bakken, Powder River, and Eagle Ford. 2

3

Overview Current Anti-Collision Practices Williston Basin Overview Geologic Considerations and Planning Risk Management Drilling Considerations Stoplight Industry Method Steering Committee on Case Wellbore Studies Survey Accuracy Conclusion

Anti-Collision Industry View Standard view errs towards avoidance mentality: Total Avoidance Azm. Avoidance 5 Limited support and documentation for alternative processes when avoidance is not an option.

Anti-Collision Case Study Williston Basin 13,000 vertical wells, 15,000 horizontal wells, 1,000 re-entry/directional wells. 6 Developed for horizontal drilling across pre-existing horizontal wellbores in the Williston Basin. Drilled as close as 10 feet wellbore - wellbore 45 Miles

Geologic Considerations Anti-Collision Program Constraints 7 Laterally Continuous Formation Well Control Quality Data Clear Steering Markers Gamma Resistivity Middle Bakken ~20-80 Three Forks ~15-65

Geologic Planning Anti-Collision Methodology 8 Reinterpretation * Profiles * Structure Organization of Stratigraphic position Wellbore Placement Target Selection

Drilling Considerations Risk Management Program Potential Risks Impact vs. Probability 9 Risk Matrix Common Indicators Operational Parameters Geologic Directional/Survey Survey Error Ellipse of Uncertainty

Drilling Uncertainty Ellipsoids of Uncertainty 10 Major Concern Affecting Anti-Collision Planning Survey Error: MWD Error and interference concerns. Azimuth Uncertainty Inclination Uncertainty Surface Location Uncertainty Ellipse of Uncertainty: Expanding ellipse from surface onwards. Netwas Group Oil, 2017

Mitigating Risk & Accounting for Error Risk Management Meets Geology 11 Ability to simplify risk with the combination of drilling & geologic considerations. Expected Structure Apparent Dip Distinct Stratigraphic Markers Confirmation of Y or TVD direction Ellipse of uncertainty becomes plane of uncertainty with no expansion in the Y direction.

Stoplight Method A Disciplined Approach 12 Multidisciplinary approach using: Geologic Considerations Operations Best Practices Risk Management Geologic overlapping target windows by color zone implemented across the planned wellbore based on the risk management plan considerations. Existing Wellbore Stratigraphic Placement Red : High Risk Orange: Med. Risk Yellow: Low Risk Green: No Risk

Stoplight Method Risk Parameters Red: High Risk Controlled Operations & high alert communication Precise Steering target required Orange: Medium Risk Controlled operations and heighted communication procedures Overlap zone for steering adjustments Yellow: Low Risk Standard operations & communication procedures Begin steering considerations Green: No/Low Risk 13

Case Study A Stoplight Method 14 Drilled 32 above existing wellbore. 23 Total Thickness

Case Study B Stoplight Method Drilled across 3 existing laterals. Drilled 26 below wellbore #1. Drilled 34 below wellbore #2. Drilled 8 below wellbore #3. 15 #1 #2 #3 Wellbore #1 Wellbore #2 Wellbore #3 73 Total Thickness

Case Study C Stoplight Method Drilled across 3 existing laterals. Drilled 20 below wellbore #1. Drilled 36 below wellbore #2. Drilled 15 below wellbore #3. 16 #1 #2 Wellbore #2 #3 48 Total Thickness

Anti-collision Moving Forward Advancement in Practices 17 Mature Basin Development requires industry progression towards complex wellbore trajectories with significant collision concerns. Williston Basin anti-collision wells historical percent: 2010 ~ < 0.1% 2016 ~ 4.25%

Conclusions Industry Advancement 18 The progression towards increasingly complex wellbores requires Industry advancements in anti-collision practices and theories outside of avoidance mentality. Proactive approach to development for infill wells. Inclusive geological and engineering considerations. The Stoplight Methodology simplifies complex multidisciplinary considerations including hazards and stringent operational requirements into easily recognizable plan. Green = Go, Red = Stop

Thank You 19 The methodology and subsequent case studies were performed as part of the operational program at Liberty Resources, LLC. We would like to thank Liberty Resources, LLC for their continued support.