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Conductor Hole <br />The conductor hole was drilled by Pete Martin Drilling Inc. on June 29, 2013, and the <br />casing was set and cemented the next day. The conductor hole was drilled with a 20 -inch <br />bit to a depth of 80 feet and the 13.375 -inch conductor casing was set to the same depth. <br />The casing was cemented to surface with 5.5 cubic yards of Portland Type II cement. SDI <br />conducted a gyro survey in the conductor hole between the depths of 15 feet and <br />80 feet GL, sometime after the hole was cemented and before the spud of the <br />intermediate hole on July 4, 2013. <br />Intermediate Hole Operations <br />The 9.875 -inch diameter intermediate hole was spudded at 09:30 hours on July 4, 2013 <br />with a slick BHA (non - directional) and drilled from 91 feet to 141 feet MD KB. The slick <br />BHA was tripped out of the hole and the directional BHA No. 1 was built up and run in the <br />hole. BHA No. 1 was a directional drilling assembly which consisted of, in part, a 9.875 - <br />inch Reed tri -cone rock bit (Serial No. 7 -1 -0351) and a 6.75 -inch mud motor (Serial No. <br />6812) with a 2.00 degree bend. A gamma detector was spaced at 34.9 feet behind the bit <br />to aid in correlation while drilling to casing point. <br />Capstar Rig #314 began drilling with BHA No. 1 at 130 feet at 14:25 hours on July 4, 2013, <br />and drilled to 1,830 feet MD KB by 08:15 on July 6th. The drilling fluid was water based <br />mud (WBM) with MI Gel and Poly -Pac R additives. At 1,359 feet MD KB, 250 barrels of <br />mud was lost and another 130 barrels was lost at 1,612 feet MD KB near the bottom of the <br />B- Groove stratigraphic zone. Circulation was not lost completely and the losses were <br />stopped with the addition of LCM in the form of sawdust and fiberseal. At 1,830 feet (in <br />the L5 Zone of the Parachute Creek Member of the Green River Formation) inclination <br />would not build consistently and BHA No. 1 was pulled out of the hole. Scientific Drilling <br />personnel were not able to adjust the motor to the desired angle (3 degrees), so a 3- <br />degree motor was delivered to location at 16:00 hours the same day. <br />Daub & Associates, Inc. Page 3 of 13 10H -1V Well Summary Report <br />