Cenkos Analyst Comments, page-60

Thanks CA.

It looks like the $20bbl is applicable to the triple stack technique they may be piloting ?

I saw the triple stack presentation (well one of them anyway, may have been a media item on new completion techniques to lower BE costs in fact) a few months ago and thought it was in the very early stages of trialing/piloting. As we know tho, these guys are MOTORING with these new capital flexible onshore unconventionals and it wouldn't surprise to see it fully implemented in the very near future if it hasn't been already.

If the case then yes Id have to agree with you re COP perhaps having reserves that are much lower BE and would prioritise these over an Icewine acquisition/operation.

Its interesting to note that Icewine may have the same potential with multiple oil bearing layers at Ice 1.

I was expecting some form of annmnt on the potential of the Kuparuk below the HRZ but they only mention that it bodes well for the conventional to date. They also had good oil shows above the HRZ from memory so whether that translates to a decent unconventional type reservoir is still open to question.

I say this because of the continued advances in completion technology/techniques and when you have a well already established this obviously brings BE costings down considerably as it appears to be doing with COP's Eagle Ford acreage with that very low BE of $20bbl.

I think that preso BE number that I quoted was for BE across all their reserve types and didn't realise that You were referencing just to the unconventional BE when applied to the triple stacking, if the case.

The interesting thing for me is just how low can these guys go in this regard as it seems to appear that some of these types of reservoir where the shale/rock type varies in the strata but can still carry good production potential.

What is important with these types of reservoirs is the retained o/pressure/pore pressure and the thermal maturity/ TOC in these strata as you can have one or two factors that are good but if you are lacking o/pressure then it may not be economic to extract as you will not have initial hydrocarbon flow rate.

The other important factor is the Geologic history and this relates to the Thermal Maturity WHEN THE organics were being converted. The strata require depth for these processes to be completed. I believe much of the Eagle Ford has been uplifted from S/East to N/West POST the creation of the sweetspot zone.

You are probably cogniscent of all these factors tho. I'm just mentioning this stuff for the benefit of newer less researched unconventional holders as its important for them to get their heads around this stuff.

Didn't think you were being disrespectful re DW/PB CAus.

Took your meaning to be simply that they wouldn't want to be controlled by the operator until such a time that they were happy the particular sweetspot being developed was derisked as far as possible. At some stage or another imo 88E/Bex MUST hand over operational control of the farmed acreage. This is why they will make sure that any incoming Icewine operator has their heads screwed on particularly as regards the fact that this is a NEW TYPE OF PLAY and there are some NON lower 48 Variables that will need to be dealt with but I'm sure PB will be fully cognisant of any such issues as I would think he will want to be involved in all stages of the initial Icewine pilot program and then into the full production development IF we get that far !!!

d.