San Leon Energy: Most Successful Shale Vertical in Poland

Breakthrough Frac Design from SIGMA³ Helps Stage Set for Commercially Viable Horizontal Well in Baltic Basin

HOUSTON, TX – July 15, 2014 – SIGMA³ (Sigma Cubed Inc.) provided the stimulation design and dynamic simulation modeling and onsite stimulation expertise for the San Leon Energy Plc (SLE) Lewino-1G2 shale gas well in Poland's Gdansk W Concession. With predictions of 200,000 to 400,000 scf/day, SLE described this project as the country's most successful vertical frac to date and is moving quickly to plan the first Lewino horizontal well with multi-frac stages. SIGMA³ was part of a services team led by United Oilfield Services (UOS).

After testing two frac strategies in the lower Ordovician, SLE's objective for the stimulation program in the upper shale interval was to prove the ability to fracture and enable sustained production. The same strategies would then be applied to a multi-stage stimulated horizontal well in the lower Ordovician – which has superior gas saturation and porosity – intended to open the upper and lower intervals and deliver consistent commercial flow rates.

"SIGMA³ provided engineering expertise for the final frac campaign of the vertical well, and it went exactly as planned," said Joel Price, Chief Operating Officer, SLE. "This break-through frac design is critical to the successful shale development in Poland's Baltic Basin, as well as Europe by association. We are excited about applying these learnings to the upcoming horizontal well with the aim of achieving commercial flow rates."

After the final frac, the Lewino vertical well yielded sustained production of 45,000 to 60,000 cubic feet of gas per day after partial frac fluid recovery. Using the available flowback data, SIGMA³ performed dynamic simulation modeling to determine the permeability of the upper formation and predicted post-cleanup production of 200,000 to 400,000 standard cubic feet per day.

"The vertical well was the testing ground, enabling us to learn more about the well properties and change the stimulation program to achieve maximum production. We are confident that fracs can be designed in the horizontal well that will cover the entire Ordovician target zone," said Price. "SIGMA³ and the team concluded that the production from the third frac campaign is coming from the upper half of the formation. The lower interval has even better reservoir characteristics and is our primary target. There is significant upside once the horizontal well is executed."

"We appreciate the opportunity to play a role in what will be the proving ground for shale optimization and production in Poland," said Jorge Machnizh, SIGMA³ CEO. "San Leon Energy is a trailblazer, and we are excited that our engineering efforts are contributing to their success."

SIGMA³ will be participating in frac design and analysis of the upcoming horizontal well, due to drill and frac later this year, which will allow a number of varied frac programs to identify the best approach – from 10 to 30 frac stages as routinely performed in the US.

About SIGMA³
Sigma Cubed Inc. (SIGMA³) addresses the demands of the next generation of conventional and unconventional resources producers through the development and delivery of unprecedented GeoEngineering™ integration, resulting in better subsurface reservoir characterization targets and optimal frac and completion strategies. Operators can significantly increase production while reducing costs by fracturing the reservoir where it is most productive, and validating their results using the industry's most reliable microseismic acquisition, event detection and location accuracy algorithms. Through a truly integrated, commercial portfolio of proprietary software, expertise and services, SIGMA³ helps clients target the sweet spots that will yield maximum EUR.

Media contact:
Kathy Ashmore
+1 281 363 8566