PNG DRILLING COMPANY LIMITED RUSSIAN DRILLING CONTRACTOR WITH INTERNATIONAL APPROACH

PNG DRILLING COMPANY LIMITED RUSSIAN DRILLING CONTRACTOR WITH INTERNATIONAL APPROACH

ABOUT COMPANY PNG Drilling Company Ltd. is an independent private Company providing a complete range of services in the sphere of deep well drilling and work-over. The Company headquarters is located in Moscow. PNG Drilling Co. production facilities and assets are concentrated in the Southern Federal District, Yamal-Nenets Autonomous District and the Republic of Komi of the Russian Federartion. PNG Drilling Co. possesses all the required licenses and permits to perform statutory activities, is a member of Self-regulated Organization (Moscow, the RF), International Association of Drilling Contractors (IADC, USA) and International Well Control Forum (IWСF, UK). PNG Drilling Co. is a Russian drilling contractor with international approach. The Company possesses experience of participation in several dozens of tenders organized by Russian and international independent and vertically integrated oil-&-gas companies both in Russia and abroad. PNG Drilling Company has drilled many a dozen of wells for Russian and foreign users of subsurface resources including such big and esteemed oil-&-gas company as JSC LUKOIL and its activities were always awarded the top assessment. 2

PNG DRILLING CO. COMPETITIVE ADVANTAGES Along with highly qualified personnel the Company possesses objective advantages as compared to its competitors, among other things this is due to the use of world-class drilling equipment. Below are presented only a few competitive advantages of PNG Drilling Co. drilling rigs: 1. The entire PNG Drilling Co rig fleet was manufactured in Italy and the USA, the rigs are highly mobile (the hoisting module is transported by 1 or 2 semitrailers only) and space-saving (as regards their allocation on drill site). The rigs mean age is 1.5 year. 2. All the drilling rigs are equipped with European-made Power Top Drive. 3. All the rigs enable to create adjustable axial downward load onto bit (0-30 MT) without changing bottom-hole assembly ( Over Top Drive ) which fact is especially important while drilling through the first meters of drift-sand layers and in other situations when it is impossible to create pressure on bit using DC and bottom-hole assembly at drilling and casing of side tracks as well as casing running in horizontal sections and/or in multi-lateral wells. 4. All the drilling rigs are equipped with dedicated pipe elevators of Overshot type for DP roundtrip operations and casing running with simultaneous flushing and rotation. Such elevator also enables drilling with casing using standard equipment of mobile rig, while other contractors have to use for this purpose expensive (as compared to PNG DC daily rate) external service by western companies such as Tesco-Schlumberger or Weatherford; 5. All the rigs are equipped with pipe handlers an automated system for pipe delivery from surface racks to TD and back (Power Catwalk) enabling to reduce one DP connection time up to less than 60 seconds (while traditional rig standard rate is 180 sec.); 3

PNG DRILLING CO. COMPETITIVE ADVANTAGES (continued) 6. All the rigs are equipped with up-to-date drilling process monitoring and control systems (controlling joysticks, on screen display in driller s cabin and record of current drilling parameters with their wireless transmission to foreman and Customer s office, CCTV, etc.); 7. PNG Drilling Co. possesses its own equipment and techniques for: (a) MPD; and (b) UBD; 8. PNG Drilling Co. is the sole drilling contractor in the Russian Federation owning equipment and techniques for on-going continuous mud circulation in drill string (without interruption for DP makeup) which is especially important at deep and difficult well drilling when circulation interruption while making-up endangers borehole integrity; 9. PNG Drilling Co. possesses its own equipment and techniques for drilling with simultaneous wellbore casing using dedicated tools installed on the TD and drilling floor; 10. PNG Drilling Co. possesses equipment and techniques for sumpless drilling using big cuttings dryer centrifuges instead of traditional environmentally-dangerous coagulation & flocculation system applying corrosive acids. 11. PNG Drilling Co. has an affiliated grouting company PNG Service Company (www.pngservice.ru), and actually is an integrated drilling contractor that is able to render services of oil- &-gas well construction on turn-key and one-stop-shop basis. Detailed information on the above and other PNG Drilling Co. competitive advantages is available on the Company official site (www.png-drilling.ru). 4

Drilling Rig Fleet Drilling Rig 1: POBEDIT 4000 / WEI DS205 Mobile Rig (WEI, Italy) Mobile (semi-trailer, 3 axes), diesel-hydraulic Drilling Rig: Drive type diesel: 2 x Caterpillar C18, aggregate capacity 1260 hp (930 kw); Max load carrying capacity 205 MT (450,000 lbs); Power top drive max torque 39 000 Nm; Adjustable axial bit load 0 to 25 MT; Clearance for BOP installation 5.5 m (18 ft); Nominal depth of drilling using 127 mm (5 ) HWDP 3 200 m; MDR is equipped with: (a) semi-automatic pipe delivery system (pipe handler); (b) hydraulic power tongs for pipe making-up and breaking-out ( rough neck type); Drilling is effected with single HWDP, pipe length RIII (up to 14.5 m), Super Single without using personnel on the drilling floor and the crown (no personnel present), which fact ensures a higher operations safety; MDR is equipped with 2 Ellis Williams Engineering mud pumps (USA), model E-800 (2х800 hp, drive: Caterpillar 3412E) 4 cleaning stages, circulation system capacity 215 m 3 ; Winterization according to design intended for operation in Russian cold climate conditions; BOP of Shaffer type, 350 x 350 (13-5/8 x 5,000psi); One main coupled Cummins diesel generator set (2х320 kw) and one stand-by John Deere diesel generator set (200 kw); Shift- camp for 50 persons, ski-mounted wagon-type houses. 5

Drilling Rig Fleet (continued) Drilling Rig 2: ESKIMOS 4500 /WEI DS250 Mobile Rig (WEI, Italy) Mobile (semi-trailer, 5 axes), diesel-hydraulic Drilling Rig: Drive type diesel: 2 х Caterpillar C18, aggregate capacity1500 hp (1119 kw); Max hook load 250 MT (550,000 lbs); TD max torque 39 000 Nm; Adjustable axial bit load 0 25 MT; Clearance for BOP installation 5.5 m (18 ft); Nominal depth of drilling using 127 mm (5 ) HWDP 3 800 m; Mobile Rig is equipped with: (a) semi-automatic pipe delivery system (pipe handler); (b) hydraulic power tongs for pipe making-up and breaking-out ( rough neck type); Drilling is effected with single HWDP, pipe length RIII (up to 14.5 m), Super Single without using personnel on the drilling floor, which fact ensures a higher operations safety; MDR is equipped with 2 WEI (Italy) mud pumps, model F-1000 (2 х 1000 hp, drive: Caterpillar C18) 4 cleaning stages, circulation system capacity 250 m 3 ; Winterization according to design intended for operation in Russian cold climate conditions; BOP of Shaffer type, 350 x 350 (13-5/8 x 5,000psi); One main coupled and one stand-by Cummins diesel generator set (2 х 400 kw and 240 kw correspondingly); Shift- camp for 50 persons, wagon-type houses on chassis. 6

Drilling Rig Fleet (continued) Drilling Rig 3: VIKING 6000 /WEI D340-32 Mobile Rig (WEI, Italy) VIKING 6000 / WEI D340-32 Mobile Rig will supplement PNG DC rig fleet in summer 2014. This Rig has no analogues and is unique in respect of its characteristics and mobility. Mobile (semi-trailer, 5 axes), diesel-hydraulic Drilling Rig: Drive type diesel: 2 х Caterpillar C-32, aggregate capacity 2 250 hp (1678 kw); Max hook load 340 MT; TD max torque 53000 Nm, capacity 700 hp; Adjustable axial bit load 0 30 MT; Clearance for BOP installation 7.2 m (18 ft); Nominal depth of drilling using 127 mm (5 ) HWDP 6 000 m; MDR is equipped with: (a) semi-automatic pipe delivery system (pipe handler); (b) hydraulic power tongs for pipe making-up and breaking-out ( rough neck type); Drilling is effected with triple- or double-stands (pipe length RII or RIII), max string length 28 m; MDR is equipped with 2 WEI (Italy) mud pumps of F-1600 type (2 х 1600 hp, drive: Caterpillar C-32) 4 cleaning stages, circulation system capacity 450 m 3 ; Winterization according to design intended for operation in Russian cold climate conditions; BOP equipment of Shaffer type, 350 x 700 (13-5/8 х 10,000psi); One main coupled and one stand-by Cummins diesel generator set; Shift- camp for 50 persons, wagon-type houses on chassis. 7

Drilling Rig Fleet (continued) Drilling Rig 4: PIONEER 4000 WEI DS 205-22 LT (WEI, Italy) Mobile (semi-trailer, 4 axes), diesel-hydraulic Drilling Rig: Drive type diesel: 2 x Caterpillar C 18, total power 1,260 hp (930 kw); Max static hook-load capacity 205 MT (450,000 lbs); Top drive max torque 39 000 Nm; Pull down system with controlled load onto the bit from 0 up to 25 MT; Clearance for BOP installation 5,5 m (18 ft); Nominal depth of drilling using 127 mm (5 ) DP 3,200 m; MDR is equipped with: (a) semi-automatic telescopic pipe handling system (power catwalk telescopic); (b) hydraulic power tongs for pipe making-up and breaking-out (power rough neck); (c) power rotary slips; (d) top drive; (e) overshot on top drive; (f) zero spills system; (g) drawworks free rig s desing, etc.. Drilling is done by Doubles DP Stacks Range 2 (max length of the stack 19 m), Doubles Range 2 without drill floor men and no derrick-man which secure high safety of operations; MDR is equipped with 2 X WEI QF-1600 mud pumps (Italy), 1,600 HP each, diesel drive Caterpillar C 32 4 stages mud purifying circulation system with total volume of 250 cub.m.; Winterization according to design intended for operation in Russian cold climate conditions; BOP of Shaffer type, 350 x 350 (13-5/8 x 5,000psi); One twin Cummins diesel generator set (2 х 320 kw) and one single back up John Deere diesel generator set (200 kw); Shift- camp for 50 persons, trailer mounted, wagon-type houses. 8

Drilling Rig Fleet (continued) Drilling Rig 5: SARMAT 4000 WEI DS 205-22 LT (WEI, Italy) Mobile (semi-trailer, 4 axes), diesel-hydraulic Drilling Rig: Drive type diesel: 2 x Caterpillar C 18, total power 1,260 hp (930 kw); Max static hook-load capacity 205 MT (450,000 lbs); Top drive max torque 39 000 Nm; Pull down system with controlled load onto the bit from 0 up to 25 MT; Clearance for BOP installation 5,5 m (18 ft); Nominal depth of drilling using 127 mm (5 ) DP 3,200 m; MDR is equipped with: (a) semi-automatic telescopic pipe handling system (power catwalk telescopic); (b) hydraulic power tongs for pipe making-up and breaking-out (power rough neck); (c) power rotary slips; (d) top drive; (e) overshot on top drive; (f) zero spills system; (g) drawworks free rig s desing, etc.. Drilling is done by Doubles DP Stacks Range 2 (max length of the stack 19 m), Doubles Range 2 without drill floor men and no derrick-man which secure high safety of operations; MDR is equipped with 2 X WEI QF-1600 mud pumps (Italy), 1,600 HP each, diesel drive Caterpillar C 32 4 stages mud purifying circulation system with total volume of 250 cub.m.; Winterization according to design intended for operation in Russian cold climate conditions; BOP of Shaffer type, 350 x 350 (13-5/8 x 5,000psi); One twin Cummins diesel generator set (2 х 320 kw) and one single back up John Deere diesel generator set (200 kw); Shift- camp for 50 persons, trailer mounted, wagon-type houses. 9

MISSION & STRATEGY Company Mission, Strategy and Management PNG Drilling Co. mission is provision of high quality services in oil & gas well construction and work-over applying state-of-the-art drilling machinery and techniques meeting world-class standards. The strategic target of PNG Drilling Company Ltd. is to become the most preferable Russian contractor in the sphere of drilling services. MANAGEMENT PNG Drilling Co. Chief Executive Officer is Mr. Zamir Abdullaev, Ph.D., he has got two higher education degrees: Military & Legal (Moscow) and Oil & Gas (Moscow, Russian Federation, and Manchester, Great Britain). PNG Drilling Co. is staffed with highly professional engineers and specialists. Their longstanding successful experience has been honored with diploma and commendations by Governors of Khanty- Mansiisk Autonomous District, Krasnodar Territory, Astrakhan Region, the RF Ministry of Energy. PNG DC managers and engineers possess experience of work in such companies as Rosneft, Lukoil, Gazprom Neft, Zarubezhneft as well as in oil-&-gas and drilling contractor companies of Canada. 10

SOCIAL POLICY Company Social & Industrial Policy PNG Drilling Co. social policy is aimed at creation of favorable work conditions, improvement of infrastructure and social amenities, provision of comfortable conditions for employees lodging in dormitory accommodations, shift- and field camps. PNG DC shift-camps represent a perfect model of social and living condition organization for drilling crew members and subcontractor units personnel. HSE & QUALITY MANAGEMENT SYSTEM The most important directions of PNG Drilling Co. activities are: protection of the Company employees life and health, reduction of negative impact on the environment and sound resource management. PNG Drilling Company possesses certificates of conformity to international standards of integrated management systems, inclusive of: ISO 9001 Quality Management System, ISO 14001 Environmental Management Systems and OHSAS 18001 Occupational Health and Safety Management System conformity certificates. 11

PARTNERS TESTIMONIALS & RECOMMENDATIONS 12

MOBILE RIG PHOTOS Mobile Rig POBEDIT 4000 / WEI DS205 Mobile Rig ESKIMOS 4500 / WEI DS250 Mobile Rig POBEDIT 4000 / WEI DS205 Mobile Rig ESKIMOS 4500 / WEI DS250 13

Contacts: PNG Drilling Company Ltd. 77 Butyrskaya Str., Moscow, 127015, Russia Phone: +7 495 787-37-27, Fax: +7 495 787-37-28 E-mail: info@png-drilling.com www.png-drilling.com 14