Bakken Oil Formation

Presented by

Century Energy LTD.

 Century Energy LTD.
• Century Energy Ltd (TSX.V:CEY, PK:CEYFF) is a junior oil and gas
exploration company actively pursuing resource opportunities in
North America. The company holds five leases adjacent to the
Roncott / Bakken Oil Field, which is prospective for both horizontal
and vertical drilling. Century Energy Ltd. has signed a farm-out
agreement with TriAxon Resources Ltd. of Calgary for the drilling of
a horizontal well before December 31st, 2008, on Century's acreage
adjacent to the Roncott/Bakken oil field in southeast Saskatchewan.

• Please visit www.centuryenergyltd.com for more information.

 Bakken Geology
Bakken Formation is comprised of 3 Members
Upper Shale Member– Source & Seal
Middle “Siltstone” Member– Reservoir & Migration
Conduit
Lower Shale Member- Source & Seal

-Middle Member Depositional Environment=Complex

Marginal Marine to Marine Shelf Environment with a
variety of rock types ranging from shales to siltstones
and fine grained sandstones, lime- and dolostones.
(Described as a ‘carbonate/clastic tug of war’ by Hess)
James A. Peterson, University of Montana
 Bakken Comparison – Canada /
USA
- The Bakken zone is geologically and lithologically complex across
the Williston Basin with numerous marginal marine depositional
environments and resultant rock types

- Montana rock types represent carbonate bank deposits

- North Dakota, Saskatchewan, and Manitoba rock types represent a

variety of marginal marine deposits

- The zone is about 10,000 feet deep in Montana and North Dakota,
about 5,000 feet in Viewfield Saskatchewan and about 3,000 feet in
Sinclair Manitoba
- OOIP per section for the different areas is estimated to be in the
order of 3 MMStb to 7 MMStb

- The oil is light, at about 40 – 45 degrees API

- Permeabilities are in the order of 0.001 to 1 millidarcy

- The fractured Bakken in North Dakota has initial rates of over 1,000
Bopd, the Montana Elm Coulee wells produce initially about 500
Bopd, the Viewfield wells commence at about 200 Bopd and the
Sinclair vertical wells start producing at rates of about 50 Bopd
- The deeper areas have lesser well density; about 2 Hz wells per
section, or less, as compared to Viewfield with 4 Hz wells per section
and Sinclair with 16 vertical wells per section

- Current Bakken production rates are estimated to be 130,000 Bopd

from 650 wells in Montana, 70,000 Bopd from 400 wells in North
Dakota, 40,000 Bopd from 550 wells in Viewfield and 10,000 Bopd
from 725 vertical wells in Sinclair
 Viewfield Bakken
Reserve Estimation Methods
- Volumetrics: Volumetric estimates using vertical well open hole logs,
samples and core control

- Computer simulation work on the Bakken to assist in estimating

solution gas drive recovery factors, potential interference effects
between wells and the expected production profile

- Type curve analysis

 Viewfield Bakken
Reserve Estimates
• - OOIP: 4 MMstb per section developed with 4 Hz wells per section;
1 MMstb OOIP per well

- Recovery Factor of 10%, 100,000 barrels of oil per well. 2P at

12.5%, 125,000 barrels of oil per well, and 3P at 17.5%, 175,000
barrels of oil per well.

- This represents the “average” well that has been used as an

analogue. Reserves assigned to both drilled wells and offsetting
locations will be dependent upon actual production characteristics of
producing wells in the vicinity
 Reserves Evaluation Issues
- Extremely active, over 100 wells per month, public and confidential
data

- A multitude of undrilled reserves, resource and prospective locations

- Short life performance history on the steep decline portion only; long
life lesser decline only a guess
 Reserves Evaluation Issues
- All wells are not “type” wells, sand is not a blanket (sink holes, crater
features, areas of anomalous tighter or sandier sediments and
structural components)

- All horizontal wells do not keep perfectly within the sand at an

optimum position, nor do all fracture stimulations stay “in the zone”

- Even “Packers Plus” fracture methods are not the same due to
different number of intervals and fluid type sensitivities
 Bakken Booking
Methodology
- Until the advent of horizontal drilling and focused fracturing
techniques, the Bakken oil play was limited to stimulated vertical
wells in areas where the average permeability was in the order of
10’s of millidarcies. Any other Bakken oil areas with low permeability
were uneconomic to develop even though producible oil was
established.

- The prospective resources in the Bakken play, both in the USA and
Canada, could be very large. In April 2008, the United States
Geological Survey assessed the mean undiscovered volume of oil in
the Bakken in the Williston Basin area of Montana and North Dakota,
combined, to be 3,650 MMstb.

- Resources and reserves bookings in the Bakken will be done by

analogy using type curves. The play lends itself to a statistical
approach, taking into account available geological and production
information.
 Bakken Booking
Methodology
- Prospective resources will be rapidly upgraded to contingent
resources or, more likely, to reserves, as wells are drilled.. The
USGS considers the Bakken oil play to be largely a resource play

- Resource and reserves assignments will be dependent on geological

and well control. A single successful oil well can result in a number of
offset reserve and resource locations. A few strategically placed
successful wells in an area can result in the booking of multiples of a
single well’s offset location potential.