Provider of Oil Production and Reserve Recovery Increase Company Presentation June 2008 Strictly...

Provider of Oil Production and Reserve Recovery Increase Company Presentation June 2008 Strictly Private & Confidential

June 2008 - 2- Greenzyme releases oil through changing the surface tension between oil and water, it is environmentally friendly and has proven its ability to stimulate oil production without any damage to the formation Access to Greenzyme technology is based on a cooperative agreement with inventor and IP owner Philip Lau and his company Apollo Separation Technology Inc, based in Houston, Texas, USA. The agreement provides for exclusive rights to Greenzyme application onshore and offshore UK, Norway, Denmark and Sweden, and from a non-exclusive basis gain exclusive rights for countries entered into (*) Wellco Oil - Executive Summary *except China, Venezuela, Indonesia and North America Entered into agreements with a variety of oil companies with the intention to identify, plan and execute well stimulation going forward. Projects to be conducted at a no-cure no-pay risk sharing basis, where Wellco recovers costs based on achieved production increase, and where client and Wellco shares the resulting value enhancement from the well stimulation First well stimulation campaign agreed to start early Q2 2008 Infinite demand expected for effective stimulation and environmental services worldwide in light of maturing and declining oil fields, falling reserves and increasing public attention on environmental issues Very positive results achieved from Greenzyme well stimulation operations in China, Venezuela and Indonesia, with substantial and sustained production increases Water flooding core tests with Greenzyme has shown an oil releasing capability of more than 10 percent points of remaining oil in place (20-30 % share) Established year end 2005 with start up capital in place March 2006 The objective is to become an EOR and environmental focused oil Service & E&P company, based on access to the Greenzyme stimulation technology Strategic focus for 2008 is on pursuing and conducting well & reservoir stimulation pilots and build operational and commercial experience Experienced oil&gas resources involved in buildng and developing company Access to unique stimulation technology Large global market and value creation potential Oil well stimulation campaigns in 2008 Start-up oil service company INTRODUCTION

June 2008 - 3- Strategic Focus for 2008 Build documentation on EOR potential and prepare commercialisation of the Greenzyme technology Conduct pilot campaign on onshore oil wells in reservoirs with significant residual oil and near well bore damage Build organisation in Norway to cope with increasing number of countries

June 2008 - 4- Key Milestones in Wellcos development Incorporation By experienced Norwegian Entrepreneurs in Nov 05 On the basis of unique relations to inventor of Greenzyme, Mr. Philip Lau Exclusivity Agreement with Apollo Cooperative Agreement with Apollo in April 06 Renewed and strengthened cooperation in Oct 07 Capitalisation & Organization Strong backing from Norwegian Private Investors PetroAdvisor, an Oil&Gas Advisory Firm within the R.S. Platou (World Leading Shipbroker Firm) family of companies involved in managing the company Leading Norwegian reservoir / sub-surface resources involved Headquarter established in Oslo, Norway Technology documentation & verification Collected documentation from E&P companies applying technology Executed independent lab-tests with positive results, Aug-Dec 06 Achieved certificate for North Sea / Offshore application, April 07 Well stimulation agreements & operations Entered into LOIs with independent E&Ps and NOCs for well stimulation projects in Europe, Middle East, South-America and Asia Agreement Perenco to start well pilot in Turkey in April 2008 JV agreement signed with bill$ Bahrain company for cooperation throughout the Middle East Final negotiation ongoing with Babco to run pilot onshore Bahrain in April-May 2008 Final negotiation ongoing with ONGC to run pilot onshore India INTRODUCTION

June 2008 - 5- Our Value Proposition for Well Stimulation Our objective is to : -Substantially recover crude oil production from declining / low producing oil wells with near well bore damage -Avoid future reduction in oil production Our main commercial model : Execute no-cure no-pay risk-sharing well stimulation projects with client, typically: Wellco provides on site at our expense Greenzyme and supervisors to facilitate the operation Client carries the costs of the well stimulation operation Wellco achieves cost recovery on the basis of increased oil production recovery (increase) Client and Wellco shares the value of the resulting oil production recovery (increase) from the well stimulation operation A risk-sharing partnership INTRODUCTION Substantial Value Potential* *) Example: Reported results from Wei Zhou Field well stimulation, CNOOC, China

June 2008 - 6- Organizational Structure BD& Commercial Well Stimulation Einar F. Semb Technology & Operations Well Stimulation Hans Petter Hjermstad INTRODUCTION Accounting & Admin Stein Lberg (Advice Consulting Group) Bus Dev. Manager Tim Nettleship Middle East CFO & acting CEO Ola Krohn-Fagervoll Executive Board : Magne Sveen, Chairman & EVP John Hestenes Hansen (founder) Tom A. Thorsen (founder) Einar F. Semb Legal Trygve Gravdal (Rder) Technology & Operations Apollo Liasion Bert Purugganan PetroAdvisor Resources Ivar Haaland Vice President BD Ole Fredrik Ekern Environmental Projects TBN

June 2008 - 7- Wellco Oil Shareholder Structure

June 2008 - 8- Key Resources Involved Magne Sveen Chairman & EVP PetroAdvisor; Partner. Norwegian Air Shuttle ASA; Deputy CEO. Concordia BV; Executive Director. A.T. Kearney Mgmt Consultants (5 years). Saga Petroleum (5 years). Norwegian Export Council & BP Exploration, London. Education: Visiting Scholar, Stanford University (USA), MBA-Finance, Univ. of Wisconsin (USA), Master of Bus Mgmt, Norwegian School of Mgmt Ola Krohn-Fagervoll Acting CEO PetroAdvisor; Senior Partner. First Securities ASA; Corporate Finance, Saga Petroleum (16 years); Commercial Manager with extensive experience in complex multi-company negotiations. Exxon, Texas; Engineer. Education: Msc in Engineering, Norwegian Institute of Technology (NTH) Einar F. Semb Vice President Business Development & Commercial Schlumberger Oil Field Services; Senior Mgmt, Management and Engineer positions in operations worldwide (1972-1982 & 1998-present). GeoQvest; COO worldwide (3 years). GECO; VP Software Engineering and Support (4 years). Board member in various oil service companies. Education: Various Executive Mgmt Programs at IMD, LBS and INSEAD. BSc in Mechanical Engineering, Lieutenant in Norwegian Marines Special Forces Unit. Hans Petter Hjermstad Manager Operations Dewpoint AS; Founder and Managing Director. Saga Petroleum ASA (9 years); Section Leader & Senior Advisor, Production Technology. READ Petroleum Engineering Services (5 years); Founder. Norsk Hydro Research Center (6 years); Chief Engineer. Education: Msc in Mechanical Engineering and Msc in Environmental Technology, Norwegian Institute of Technology (NTH) Ole Fredrik Ekern Vice President BD Cumulus Energy Consultants; Founder and Managing Director. PGS Geophysical; Vice President Business Development Emerging Markets. The World Bank; Petroleum Specialist. PGS Reservoir Consultants; General Director. PGS Nopec AS; Technical Director. Saga Petroleum (12 years) ; Senior Business Advisor, Senor Manager Exploration & Senior Geologist. Education: MBA, NSM (BI), Msc in Mechanical Egineering, Norwegian Institute of Technology (NTH) INTRODUCTION

June 2008 - 9- Stimulation with Greenzyme is an EOR method where a genetically engineered charged protein is introduced into the oil bearing geological reservoir. The protein is non-living and will not replicate. Due to the charge it is efficiently transported in the water phase EOR with Greenzyme is different from microbial enhanced oil recovery (MEOR) where living microbes are used. MEOR is a tertiary recovery process in which specialised microbes, calculated inorganic nutrients, and oxygen are used Greenzyme is effective over a large temperature range (35 200 o C) whereas MEOR has a significantly smaller temperature range Like for MEOR, Greenzyme will only work where there is a water phase present Enhanced Oil Recovery by Bio-technology

June 2008 - 10- Why Greenzyme has proven to deliver positive results in well stimulation operations As a biological catalyst agent, Greenzyme seems to have a unique ability to release hydrocarbon compounds from the surfaces of any solids by lowering the interfacial tension between water and oil Furthermore, the effect of the stimulation is long lasting since the Greenzymes presence on the rock surface prevent any further deposition Lab analysis and field tests prove that when Greenzyme as a dilute water suspension, is pumped into an oil-well, it sets free oil, asphaltene, wax and breaks stable water-oil emulsion build-ups near the well By removal of the formation damage (reduce skin), the oil production rates is documented to be greatly enhanced and sustained

June 2008 - 11- Greenzyme will not introduce any damage to the formation Injectivity tests : From a Core flooding experiment at Core Laboratories, Aberdeen: TECHNOLOGY PLATFORM Unchanged Permeability

June 2008 - 12- Background of the Greenzyme Technology TECHNOLOGY A Brief History: Invented by Mr. Philip Lau, Ph.D in Chemical Engineering. Former Chemical Engineer with Dow Chemical Company, USA. Responsible for 12 commercial patents Invented in the early 1990s. Initial use was to aid in the clean-up of oily sludge sites and storage tanks in the US market Since 1999 been applied in well-stimulation operations in China, Venezuela and Indonesia His company Apollo Separation Technology Inc. in Houston, Texas holds the IP rights to Greenzyme with the trademark Apollo Greenzyme

June 2008 - 13- Cooperative Agreement with Apollo Entered into agreement with Apollo, April 2006 Wellco Oil holds rights to use, sell and distribute Greenzyme (GZM) on- and offshore in the UK, Norway, Denmark and the rest of Scandinavia Wellco Oil also holds the right to claim exclusivity to new countries entered into (*) The agreement is valid for a period of 5 years with automatic 5 years renewal Renewal of agreement is dependent on fulfillment of minimum purchase volumes and satisfactory commercial progress and results Apollo Separation Technology Inc / Philip Lau Wellco Oil AS (*) Except : China, Indonesia, Venezuela and North-America INTRODUCTION

June 2008 - 14- Oil Stimulation Services in High Demand Increasing number of mature & tail-end fields worldwide Limited success in discovering new large oil fields E&P companies experiencing declining reserve replacement ratios 400-500 tail end fields in the North Sea alone In order to reverse the production decline and increase its reserve base: the industries focus has shifted towards increased oil recovery from existing fields

June 2008 - 15- Improved Oil Recovery (IOR) through water injection, gas injection and a combination of the two (WAG) is currently state of art in most oil regions of the world Advances in seismic acquisition and processing, drilling techniques and intelligent completions have further contributed to improved recovery of oil as well as accelerated production However, according to the Norwegian Petroleum Directorate, methods to mobilize the residual oil (i.e. the oil left in the rock pores) after the above measures are currently inefficient and that further Enhanced Oil Recovery efforts are needed The Industry is looking for EOR technologies of a game changing character

June 2008 - 16- The technology promises substantial value enhancement for matured oil wells* Experience from China: 300 % oil production increase from shut down well, production rose from 35 to 140 bbls/day. Increased production sustained over a 6 months period (Young 8-52, Shengli Onshore Oilfield) Oil production increase of more than 50 % on well producing more than 300 bbls/day. Increased production sustained over a period of 2-3 years (Wei Zhou 11-4-3A, Beibuwan Offshore Oilfield Experience from Venezuela: Oil production increased to 100300 bbls/day from wells originally producing 1050 bbls/day. The increased production level was in some instances sustained over a 6 months period Experience from Indonesia: An average of 93 % increased cumulative oil production has been reported for the 5 pilot wells in a EOR project in the Central Sumatra basin. The Greenzyme stimulation has shown to stay active for more than 9 months. *) Based on communications and available reports provided by Apollo Separation Technology Inc and RadEx Technology AS.

June 2008 - 17- Positive experience from well stimulation conducted in China Wei Zhou 11-4-A3 Young 8-52 Shengli Onshore Oilfield Type of crude: Parafinic 16.8 o API Permeability: 1 mD Porosity: 29.7 % Production increase: from 35 to 140 bbls/day and sustained over 6 months Wei Zhou 11-4-A3 CNOOC Beibuwan Offshore Oilfield Type of crude: 19 o API 20 scf/stb Permeability: 500-1400 mD Porosity: 20-29 % Oil saturation: 77-84 % Production increase: from 300 to 450-500 bbls/day and sustained over 2-3 years TECHNOLOGY

June 2008 - 18- Oil production increased by 50% from a well stimulation conducted by CNPC in China 2003 - 05 The injection of Greenzyme reduced near well bore damages and generally recovered the oil flow / oil production from the well. The flowing bottom hole pressure increased from 23.3 to 65.7 bar after stimulation TECHNOLOGY

June 2008 - 19- Positive experience from well stimulation operations conducted in Venezuela Source: Report from 2001, Apollo Separation Technology Inc. Houston, USA TECHNOLOGY

June 2008 - 20- Positive experience from EOR Pilot Project in the Central Sumatra Basin, Indonesia The 5 pilot wells gave on average 93 % gain in the oil production after stimulation with Greenzyme. The water cut was basically unchanged The effect of the stimulation lasted for more than 9 months Well 4 TECHNOLOGY

June 2008 - 21- Core flooding lab-tests conducted in 2005 & 2006 indicates substantial EOR potential 81.0 37.2 34.2 30.2 26.8 0 10 20 30 40 50 60 70 80 90 InitialPost water floodPost 3 % GZPost 5 % GZPost 7 % GZ Oil satuaration (% of PV) Core: Berea 427 mD (air) 20.6 % porosity S owr = 37.2 % Fluids: 20 API crude 0.933 g/cc syntetic brine (30.000 mg/l) Conditions: 25 o C 70 bar pressure PTS Laboratories, Houston, Texas, USA Greenzyme FLOOD 28 % of the residual oil after water flooding was mobilized by Greenzyme injection. TECHNOLOGY

June 2008 - 22- Conditions: 17.1 API crude 0.952 g/cc 14.5 w-% asphaltenes 25 o C 70 bar pressure 5 vol-% Greenzyme solution Conclusion The enhanced recovery obtained in earlier Greenzyme lab floods are repeated No significant difference between the Greenzyme production batches was experienced Core flooding lab-tests conducted in 2005 & 2006 indicates substantial EOR potential (cont.) TECHNOLOGY

June 2008 - 23- Core flooding lab-tests conducted in 2005 & 2006 indicates substantial EOR potential (cont.) TECHNOLOGY

June 2008 - 24- GREENZYME FLOOD SUMMARY Simulated Reservoir Stress: 1000 psi Test Temperature 122.0 o F TECHNOLOGY

June 2008 - 25- GREENZYME FLOOD SUMMARY Simulated Reservoir Stress: 1000 psi Test Temperature 122.0 o F TECHNOLOGY

June 2008 - 26- Core flooding bySinopec Southern Exploration & Production Company, China confirms the EOR potential 1 Additional oil recovery after 1 PV of Greenzyme 2 Additional oil recovery after several PVs of Greenzyme Source: Sinopec Nan Ning branch: Oil displacement experimental study at Bai Se oil field, May 26 - 2005 TECHNOLOGY

June 2008 - 27- TECHNOLOGY The wettability of the reservoir rock is important for the oil recovery in water floods The contact angle between oil and water in contact with the rock surface is a measure of the wettability Lab tests show that Greenzyme improves the contact between water and the rock surface and displaces oil clinging to the surface Greenzyme changes the wettabiliy of the reservoir rock

June 2008 - 28- TECHNOLOGY Greenzyme reduces the interfacial tension between oil and water The capillary pressure will determine if water can enter a pore and displace the oil The capillary pressure is proportinal to the interfacial tension (IFT) Greenzyme reduces the interfacial tension The IFT will stay low as Greenzyme is dilluting in the formation water Sinopec: IFT between GZM and Lun 16 oil @ 50 o C

June 2008 - 29- TECHNOLOGY Oil releasing capability of Greenzyme The oil releasing capability of Greenzyme has been measured in lab tests during imbibition of oil saturated cores

June 2008 - 30- OPERATIONS Safety Data Sheet

Contact us: Wellco Oil AS c/o PetroAdvisor/Platou Shipbrokers P.O. Box 1604, Vika 0119 Oslo - Norway Phone 0047 - 23 11 28 84 Fax 0047 - 23 11 58 28 Email [email protected]@wellcooil.com Provider of Oil Production and Reserve Recovery Increase

Provider of Oil Production and Reserve Recovery Increase Company Presentation June 2008 Strictly...

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