Oil & Gas Consulting Company

Com

pany Overview

Company Profile

Integrating with experience

Who we are

What we do

Nova Energy is a consulting group specialized in technical and economic analysis of projects, properties and companies.

We provide services from Integrated Asset Descriptions, as well as expert advice on divestment, mergers and acquisitions of oil and gas properties.

Nova Energy has a focused expertise in Integrated Asset Descriptions, Field Development Planning and Asset Transactions all involving cross-disciplinary integration of geophysics, geology, petrophysics, engineering, finance and economics.

Vast and long standing experience, impeccable ethics and access to a multidisciplinary network of business associates guarantees the high-end quality of services, teams and individuals.

Our staff comprises highly trained professionals with engineering, geological, geophysical, economic and computing skills.

Our strength comes from a business oriented focus built on individual excellence and the flow of knowledge between closely aligned multi-disciplinary teams.

Typical services include:

Asset screening. 3D static and dynamic reservoir

characterization. Field development planning. Harmonized asset reference

planning. Unconventional reservoir analysis. Well deliverability assessment. Detailed well petrophysical

analysis. Post implementation / investment

reviews. Asset transactions advice. Expert witness and data room

handling.

Com

pany Overview

Upstream IndustryWhere we apply our expertise

Our services can be applied on the following scenarios :

Corporate Planning: including review of field multiple operational scenarios and selection of the Best Case.

Completion assessment: Integrated well data interpretation provide assessment on future well deliverability.

Entry to Business: Screenings, Data Room Handling and Expert Advice for Acquisition of oil and gas properties, Swaps and Mergers.

Portfolio Management: Providing asset and company suitability ranking.

Data Room handling: data collection and fast track review for data validation.

Review and evaluation of property upside : including operating cost economies, operational changes, behind pipe and undeveloped reserve potential with the application of appropriate risk containment factors.

Post Implementation Assessment: Detailed Post-Investment or Post-Mortem Reviews for asset assimilation / divestment or project monitoring, including quantification of operational improvements, upside, and recommendations for improving cash flow.

Com

pany Overview

Strategies for integrated reviewsHow we work

True integration entails a bringing together of the minds of the several team players, in the form of either individuals or complete organizations aligned together for a common achievement.

NOVAs Core Team has been vastly trained, by several decades of intensive exposure to multivariate discipline and organizational environments, to collaboratively benefit from the talents and insights from diverse project participants to deliver Integrated Asset Descriptions (IAD).

Beginning when the project is first visualized and subject to conceptual analysis, NOVAs Integrated Process workflow exploits business structures, practices, and processes from both NOVAs Core Team and from all its Third Party Associates.

IADs include several phases before Project Delivery and Closing Out and they all encourage the early contribution of knowledge and experience and requires proactive involvement of key participants. IADs could eventually continue throughout the full field life cycle until the project implementation has been achieved.

Novas core team.

Novas internal quality assurance processes.

Data Model.

Internal process workflow - Third party associates or discipline.

Three level value assessment iteration ring.

Novas

Project

Management

Team

Strategies for integrated reviewsHow we work

Post Implementation Reviews are also part of the Project Delivery Workflow and is customarily utilized to monitor performance after implementation.

This higher level of completion allows the Implementation phase to be shorter than the traditional, and the early participation of key stakeholders allows the shortening of the management review and buyout phases.

The combined effect is that the project is defined and coordinated to a much higher level prior to implementation, enabling a more efficient and shorter execution period.

Com

pany Overview

Examples of Internal Process Workflow

Dynamic Model

Well Prognosis

Production Forecasts

3D Geological Realizations

Simulation of pipeline system

3D Petrophysical

ModelWell Prod

uctivity

Statis

tical

Analy

sis

Dyna

mic S

imula

tion

3D G

rids

for S

imul

atio

n

Ma

teria

l Ba

lanc

e

Structural M

odel

Production Log

ging

PLT-ILT

Palimpastic Model

Integration of Tracer Analysis

Estratigraphic ModelProduction and Injection History

3D Sism

ic Anal

ysis

Draina

ge Pro

cess An

alysis

Inte

rwel

l Dyn

amic

s

Pres

sure

Hys

tory

Ana

lysis

Petro

phy

sic

al M

od

el

Flui

d P

rop

erti

es

Ana

lysi

s

Static Model

YACIMIENTO XXXXPRONOSTICO DE PRODUCCION

00.5

11.5

22.5

33.5

44.5

5

05 10 15TIEMPO [ANOS]

Q O

IL [M

m3/

D]

Caso Base Caso 2Caso 2a Caso 2bCaso 3 Caso 3aCaso 3b Caso 4Caso 4a Caso 4b

Business Model How we work

An Integrated Project is built on collaboration. As a result, it can only be successful if the participants share and apply common values and goals. (A Working Definition - AIA California Council 2007).

The traditional project execution approaches contemplate separate silos of disciplines and responsibility that in practice yield to inefficiencies whenever there is a hand-off from one silo to another.

Additionally, projects delivered traditionally suffer because participants success are not necessarily related. Indeed it is quite possible for one or more of the project participants to succeed notwithstanding overall project failure.

Integrated Asset Descriptions represent a behavioral change in the industry by breaking down the discipline boundaries requiring higher level of cooperation and commitment among all major participants.

ESSENTIAL PRINCIPLES

To harness the collective capabilities, the integrated team and its management embrace our principles of:

Mutual respect

Harmonized Benefit

MANAGEMENT COMMITMENT

Integrated Asset Descriptions embodies, in varying proportion, many of the following attributes:

Ring Fenced Team Configuration

Early Gains Definition

Enhanced Communication

Clearly Defined Open Standards

Appropriate Technology and Practices

Com

pany Overview

Com

pany Overview

Business ModelHow we work

Integrated VCD Processes

Standards and Technology

Ring Fenced Teams

Life Cycle Impact

Practical Solutions

Early Gains

Team Skills and Competences

Commercial

Technical MindsetsExternal PerspectiveExternal Expertise

Local Perspective

Team Resource Allocation

Local Expertise

Local Application

Mutual Respect Harmonized Benefit Police

Process Management & Commitment

Ethical Behaviour

Asset M

anagement

Asset screening

BAJO DEL PICHE LIFECYCLE

0

100

200

300

400

500

Jan-

82

Jan-

85

Jan-

88

Jan-

91

Jan-

94

Jan-

97

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00

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03

Jan-

06

Jan-

09

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12

Jan-

15

Jan-

18

Jan-

21

Jan-

24

OIL

(m

3/d)

FORECAST

INCREMENTAL SCENARIOS

PRODUCTION FORECAST

Bajo del Piche Resource VolumesFuture Oil Recoveries EOC + 10yr Extension

1,035283

421

331

-

200.0

400.0

600.0

800.0

1,000.0

1,200.0

DO NOTHING (Proven Developed

Producing)

SCENARIO 1 (Probable)

SCENARIO 2 (Possible)

TOTAL RESOURCES(3P)

K m

3

FUTURE OIL RECOVERIES

331

421 283

Do Nothing (Proven Developed)

Scenario 1 (Probable)

Scenario 2 (Possible)

Total Resources

(3P)

1,035

Our experience indicates that major decisions on support of significant investments in field development, field rehabilitation or improved recovery operations often requires from a very fast although detailed study option to provide understanding of reservoir performance in order to assess future economic scenarios.

Our Asset Screening Service is an option to provide an enhanced insight into the key production drivers that control assess performance leading to rapidly leverage the existing data for competitive bidding submittals or business entry decisions.

Reservoir Characterization is the core and also the fast growing area of business for Nova Energy.

Our team has career length experience on global projects and is supported by the most comprehensive and up-to-date software packages available in the industry.

Components of Resource Visualizations and Property Structural Modeling Petrophysics Geology Reservoir Visualization In-Place Resource Volumes

Production Allocation Forecast Incremental Projects Uncertainty Assessment Strategic Planning and Field Development Property Valuation

Asset M

anagement

Field Developement Planning

Components of Field Development Planning Structural Modeling Petrophysical Modeling Stratigrafic Modeling Sedimentological Modeling 3D Integrated Stochastic Modeling Realization Analysis Property Upscaling

Strategic Planning and Field Development Reservoir Dynamic Simulation Uncertainty Assessment Scenario Modeling Reserve Categorization Reserve Maturation and Replacement Asset Reference Plan

The successful application of Field Development Planning (FDP) for oil and gas reservoirs requires an accurate understanding of key intrinsic reservoir architectural and field operational drivers that allow the performance prediction under different scenarios.

Integrated Asset Descriptions (IAD), are fit-for-purpose analytical planning tools that originates with the creation of multiple static and dynamic 3D subsurface models that honor the one, two or three dimensional data from well bores, seismic surveys and eventually, outcropping data.

IADs are leveraged by cross-discipline interactions that lead the generated models to fit multi-dimensional reservoir definitions enabling to narrow the many business and operational uncertainties involving reservoir management.

NOVAs staff has worked over many years on improving its streamlined IAD Workflow. This workflow is enabled by the rapid diagnose of field and well behavior parameters based on a detailed analysis and QC of field data base.

Once the reservoir performance key drivers are categorized, 3D static and dynamic models are oriented to contain these uncertainties and future scenarios are forecasted. Possible upside and downside cases are generated to derive the Harmonized Project Portfolio that builds the Best Case Scenario for the asset hydrocarbon recovery.

This approach allows for answers to complicated problems to be expressed under specific operational actions encompassing from the detailed definition of individual completions to detection of operational improvements.

1466 -

1468 -

1470-

1472 -

1474 -

1476 -

1478 -

Gt-Gh: Congl. sst, F-M clast-sup congl. Graded, Horiz bed, trough x-bed Convolute. Bed thick: 0.2-0.3 m

FACIES DESCRIPTION

Gmm: F-M matrix-sup congl. Poorly sort. Massive/graded.

Fm(P): Reddish, massive,mottled mudstones. Irregular vertical bioturbation (rhizoliths).

Sg: F-M sst w/scatterdclasts. Graded, Horizbedding, x-lam. Bed thick: 8-40 cm.

Sl-Sh: F-M sst. Graded. motted, Low angle x-lam.

13 %K 0.4D

11 %K 0.006D

17 %K 0.2D

16 %K 0.03D

13 %K 0.005D

INTERPRETATION

SEMIARID ALLUVIAL FAN SYSTEM

FU cycles dominated by hyperconcentratedflows, tractive currents, and mud flows.

Poorly-developed paleosols

Shallow braided-channel fills.

Single Well Evaluation Services

Single Well Evaluation

The emphasis in logging and formation evaluation has shifted into non-conventional reservoirs, improved geosteering in ERD and horizontal wells, as well as characterizing and evaluating deepwater laminated turbidites, low-permeability carbonates, fractured tight-gas reservoirs (sandstones and gas shales) and heavy oil/tar sands.

This emphasis has produced new and improved technologies and methods that provide additional and more accurate information for downhole reservoir characterization.

The integrated analysis, of core and log data, borehole imaging, downhole pressure monitoring devices and fluid characterization at reservoir conditions can span the analytical capabilities of traditional well interpretation enhancing completion design with significant impact on the project management.

The evaluation process workflow applied by our company integrates data from multiple sources and different support volumes to provide the basis to link geology and reservoir engineering. The ultimate goal of the single or multi-well process is to build realistic 3D wellbore property distribution to help to predict future performance and support completion operations.

Components of Single Well Integrated Evaluation

Log Analysis Rock Typing Pressure Analysis Wellbore Image Interpretations Flow Unit Determination Well Deliverability Assessment Non Conventional Reservoir Evaluations

Multi Well Evaluation

Multi W

ell Evaluation

Components of Flow UnitsDeterminations

Depositional Rock Typing Petrographic Rock Typing Hydraulic Rock Typing Port Size determinations Multi Well Log Analysis Flow Unit Identification Lateral Congruency Assessment

Rock Typing provides a consistent approach for integration of reservoir properties from various scales, identifying their intrinsic rock capacities of fluid flow and storage.

It ultimately leads to the definition of Flow Units that consists of reservoir subdivisions defined on the basis of similar pore type attributes. Inflow performance for a flow unit can be predicted from its inferred pore system properties, such as pore type, pore size and pore geometry.

Rock Typing workflow considers the description of different kinds of Rock Types known as:

Depositional: macroscopic-scale, original rock properties present at deposition

Petrographic: rock properties at microscopic-scale, i.e rock texture, composition, pore system, diagene-sis.

Hydraulic: represents the physical rock flow and storage properties as controlled by the pore texture.

Sb

0.004mD 0.01 mD

Sw (%)

100 0

Phi (%)

30 0

Qi (10E3 m3/d)

0 60

K (mD)

0.002 20

Top seal

Seat seal

0 500

P. Formaci on

Initial Pressure(320 kg/cm2)

Rango de Permeabilidades de Corte

Stor age range affected by C/O

Storage and permeabilityCut-off

TODOS LOS POZOS

C2

C3a

C3b

C4 0.0001

0.0010

0.0100

0.1000

1.0000

10.0000

100.0000

0 5 10 15 20

Porosidad (%, corona)

K a

bs

olu

ta (

mD

, c

oro

na

)

RT5RT4RT3RT2RT1

Rock Types and CapCurves are the properties that describe reservoir characteristics at multiple

scale levels

Comparison of WFT and Production Test Transients

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sure

Cha

nge

& D

eriv

ativ

e (p

si)

Comparison of WFT and Production Test Transients

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sure

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nge

& D

eriv

ativ

e (p

si)

Comparison of WFT and Production Test Transients

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sure

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nge

& D

eriv

ativ

e (p

si)

Comparison of WFT and Production Test Transients

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sure

Cha

nge

& D

eriv

ativ

e (p

si)

Comparison of WFT and Production Test Transients

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1

10

100

1000

10000

0.1 1 10 100 1000 10000 100000Time (s)

Pre

ssur

e C

hang

e &

Der

ivat

ive

(psi

)

k = 300 mDri = >5000 ft

Comparison of WFT and Production Test Transients

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1

10

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10000

0.1 1 10 100 1000 10000 100000Time (s)

Pre

ssur

e C

hang

e &

Der

ivat

ive

(psi

)

k = 7 mDri = 8 ft

k = 700 mDri = 10 ft

k = 70 mDri = 6 ft

k = 127 mDri = 16 ft

Comparison of WFT and Production Test Transients

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sure

Cha

nge

& D

eriv

ativ

e (p

si)

Comparison of WFT and Production Test Transients

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10

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0.1 1 10 100 1000 10000 100000Time (s)

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sure

Cha

nge

& D

eriv

ativ

e (p

si)

Comparison of WFT and Production Test Transients

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1

10

100

1000

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0.1 1 10 100 1000 10000 100000Time (s)

Pres

sure

Cha

nge

& D

eriv

ativ

e (p

si)

Comparison of WFT and Production Test Transients

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1

10

100

1000

10000

0.1 1 10 100 1000 10000 100000Time (s)

Pres

sure

Cha

nge

& D

eriv

ativ

e (p

si)

WFT

MacroScale

DST

MegaScale

Rock Typing & Flow Unitization Approach

Capillary Pressure

Unconventional Plays Integrated Reviews

Unconventional Reservoirs

The assessment methodology (IADs) and production practices of conventional reservoirs vary from those used for unconventional resources (i.e Ultra-Deep Fractured, Fractured Gas Shales, Coalbed Methane and Tight Gas sands). Predicting productivity of offsetting well locations in a non conventional reservoir environment are one of the key challenges to enhance well placement strategy and to meaningfully differentiate the quality of a each drainage point.

In many cases, none of the conventional reservoir architectural drivers correlate strongly to well performance. There may be not a unique reliable spatial predictor of conventional reservoir variables (even if the measurements and tests required to estimate these variables have been executed) to enhance prediction of performance on unconventional environments.

However, Shale Petrophysics that includes the exhaustive integration of Core Lithofacies, Geochemically derived TOC Content, Free and Adsorbed Gas Analysis and Critically Stressed Fracture Analysis have proven to have established the basis to predict well performance at the well scale.

At a play scale though, performance may nonetheless display a wide variability; and it is often the case that such variability cannot easily be predicted in advance or even correlated to conventional measurements (e.g. porosity, thickness, structural position, etc.).

That is why, in many instances, non conventional plays have alternately been described as statistical plays in which an operator must drill a large number of wells and can expect fairly repeatable results if enough wells are drilled. Under that scenario the economic development of unconventional resources is often questionable.

This hurdle can be minimized by an integrated interpretation of large-scale architectural reservoir attributes (Reservoir compartmentalization, fractures, and faulting) obtained from leading edge seismic processing and interpretation technics.

The obtained geological framework and the resulting elements from single well petrophysics define the areas of higher concentration of reservoir properties and other building elements of the reservoir systems such as seals, and baffles controlling fluid distribution and flow in the resrvoir.

Unconventional Shale PlaysIntegrated Reviews

Unconventional Reservoirs

UNCONVENTIONAL PLAY DEVELOPMENT PLAN

Prospect Evaluation

Prospect Evaluation

Tectonic history Structural framework Stratigraphic framework Stress regime Pore pressure regime Petroleum system Geochemistry

Resource Potential

Structural framework Stratigraphic framework Sweet spot distribution Hydraulic rock properties Fracture Network Volumetrics (HC in place) Distributary drainage

volumes Uncertainty and

probability assessment

Reserves Evaluation

Geomechanical properties

Stress anisotropy Fracture system

permeability Well placement Fracture stages HF hydraulic capacity Well performance

Reserves Evaluation

Resource Potential

Unconventional Reservoirs

Core to log calibration allows the identification of shale rock properties at well-scale, in order to extrapolate the analysis to wells lacking core data based on refined stratigraphic correlations.

Components of Shale plays Petrophysics

Total Organic Carbon Analysis

Free Gas Analysis Adsorbed Gas Analysis Productivity Analysis

Petrophysical characterization of Shale plays at well-scale is the basic step for resource assessment. The integrated workflow includes

exhaustive core analysis, naming lithofacies identification, geochemical analysis for TOC content, naturally fracture systems description, as well as geomechanical properties for Hydro-fracs feasibility.

Data Loading Data QC/QA

Environmental Corrections

Estimated Ultimate Recovery (EUR)

Total Gas Content (TGC)

Total Organic Carbon Analysis

Free Gas Analysis

Adsorbed GasAnalysis

ProductivityAnalysis

Delta Log R (Passey)Density Log (Schmoker)Core data

Artificial NN

TOC Content

Kerogen VolumeEffective PorosityWater Saturation

Adsorbed Gas Content

Productivity Drivers

Volumetric AnalysisVolume of Kerogen

Effective PorosityWater Saturation

Formation Permeability

Fracture Network (FN)FN Connectivity

Langmuir IsothermLangmuir ParametersCorrect for Res. Temp.Correct for Res. Press.

Correct for TOC

Unconventional Shale PlaysShale Plays Petrophysics

Naturally-fractured Reservoirs Assessment

A fractured reservoir is defined as a reservoir where naturally originated fractures are involved in fluid flow increasing reservoir permeability. In order to achieve the correct assessment of fractured reservoirs, natural fracture analysis is the key critical aspect to take care of. Novas experience has identified an integrated workflow that connects information from several scales, specially 3D seismic, wellbore data and cores where available.

Geological description of fractured reservoirs has a final goal that consists in creating a 3D Discrete Fracture Network, which allows to identify the main characteristics of the fractured environment, leading to be the support for dynamic simulations.

Unconventional Reservoirs

Evaluation of the fracture connectivity leads to quantify wellbore deliverability, allowing multiple scenarios to be simulated and choosing the best case for future field development.

Components of Naturally Fractured Reservoirs Assessment

Detailed Structural Modeling Dual-porosity Petrophysical Modeling Outcrop and Image log fractured

systems 3D Discrete Fracture Network Fractured system connectivity

3D Integrated Stochastic Modeling Reservoir Dynamic Simulation Uncertainty Assessment Scenario Modeling Strategic Planning and Field Development

Post-Mortem Assessment

Detailed Post-Implementation (i.e Post-Acquisition or Post Mortem) reviews are a new initiative by NOVA and are intended for asset assimilation (including quantification of operational improvements), upside identification and risk assessment, and recommendations for improving performance.

The post Implementation review process is based on an integrated and systematic program of data accumulation and analysis that is collected after the implementation of the decision and provides greater visibility to shareholding and high level management on how successful past investments have been, and whether the projects have achieved the goals as expected.

Additionally the purpose of a post completion review is threefold:

To support continuous improvement in the capital investment and implementation process. This process is oriented towards the future.

Asset 2

Acquisition Value including purchase value

Current Value including purchase value

Current Value including purchase value

Acquisition Value including purchase value

Asset 1

Acquisition Value including purchase value

Current Value including purchase value

Asset 2

Post-Implem

entation Review

s

To allow for the identification and implementation of corrective actions on the project under review or in similar projects. This is an opportunity to review not only the current cash flows of a project at the date of review, but also to review the updated future cash flows of that project.

To allow for the review of current procedures and the design of better ones to improve future decisions, to guarantee better implementation and better conformance.

Our Post Implementation Review services can be applied on the following scenarios:

Restoration of Value.

Purchase Price Review

Well Post Mortem.

Well Rehabilitation Exercises.

Components of Post Acquisition Reviews

Post Mortem Reviews Post Investments Reviews Post Acquisitions Reviews Restoration of Value Purchase Price Review

Humberto 1 281 PB. A

Ciudad Autnoma de Buenos Aires, Argentina.

Zip Code: C1103ACE

www.novaenergy.com.ar

Tel: 4300-9099/79

4300-1345

Contact: +54 (911) 68409070

+54 (911) 68409030

m.mallaviabarrena@novaenergy.com.ar

h.verdur@novaenergy.com.ar