Ann: Alameda-1 Drilling Update, page-414

All eyes on Alameda Section flow testing. Lets remind ourselves of the significance of this flow test and what has potentially been discovered here in this interval so far;

During drilling operations through the Alameda interval, free oil was observed in the mud system shakers




The Alameda interval has confirmed a gross interval of 682 mMD (601 mTVD), a Net pay of 100 mMD (88 mTVD)



It is worth noting these pay figures lie well down dip from top of the structures. AP states in release 1 Feb 22; "Ideally, this would have involved each of the three objectives being intersected at the top of their structures. However, designing a well plan involves compromise, and thus, based on geological mapping, the N structure would have to be intersected at a less than optimal location, being "down dip" from the top of the structure."

"The potential upside in this scenario, however, is that finding even a thin oil column in the N objective at the current location could indicate a significant resource "updip" of the wellbore."

Following the Marti Section logging, this is reinforced by AP; "The Alameda-1 exploration well has confirmed the presence of oil across significant intervals in three structures (with potential for upside, given the two larger structures, Alameda and Marti, were intersected a long way down dip from their crests)."

Consider the following comment by AP regarding the poorer quality data (going back to the 1 Feb release) and the accuracy of their mapping;

Not sure if someone like VOGC would like to add further comment here, but this to me lends a degree of confidence in a much larger resource for the Alameda structure considering the data available to them and the fact that oil was found at their prognosed depths.

Following the logging of Alameda (N), evidence of pervasive natural fracturing was revealed by FMI logs, an important characteristic in carbonate reserviors for free flowing oil into the wellbore.



This, along with high downhole pressures, lend a degree of confidence for the reservior to be adequately charged to support unassisted oil recovery.

Following logging, external casing packers were used to isolate the zones in the N structure that will be flow tested.

Following the logging of Alameda (N), AP states (24 Feb); "The N structure is significantly larger, and is interpreted to have more net pay, than what we initially prognosed and with many of the characteristics one would expect to see in a productive reservior...."

"...Encountering an interval as significant as the one we've found in the N structure, particularly well down dip from the top of the structure, is very encouraging with respect to the potential of what we might have found here. An updated resource assessment will be undertaken and released once the current operations, including testing, are completed"