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DD

In House Resourcing of Directional Drillers and MWD Personnel:

Our group has just completed six-month review and the results are staggering. The newest innovation in horizontal directional drilling has saved the operator AFE dollars.

Directional drillers and MWD personnel worked through Callender Inc under the direct supervision of Callender Inc.'s Directional Coordinator all as consultants to the oil company. Eliminating the directional companies overhead. They were responsible for ordering motors and tubulars as well as MWD supplies. In addition, they were responsible for reviewing drilling procedures and advising on potential problems. They worked with the in house well planners and or third party well planners, which are available, to insure accurate plans were implemented.

Three operators for each discipline were acquired and brought in to replace Traditional Directional Company. We were able to realize 66% savings (Some traditional directional companies charging 20K /day while in house cost @ 6800). However, the most impressive savings were realized on the very first well drilled after Traditional Directional Company was released. They were averaging 46 to 50 days per well for Wolfcamp Operator but the in house crew drilled the very next well in 29 days. Improving with each additional well, they have gotten their average down to 25 days. That is a 50 % reduction in drilling time.

There are quality individuals available at this time and ready to improve their next customer's drilling schedules. By dedicating 3 operators to each project, it enables us to rotate the operators with a 20/10 schedule, which is un-common for this line of work. Keeping the Directional and MWD consultants from burning out with top pay is a winning scenario for both the operator and customer.

If you would like further information, please let Howard with Callender Inc know and we will be happy to meet and discuss this exciting new concept in directional drilling.

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