ENTERPRISE RESOURCE MANAGEMENT OF EM OPERATIONS Hans Christian

ENTERPRISE RESOURCE MANAGEMENT OF EM OPERATIONS Hans Christian Juul Naval Engineer Manager Special Projects, Acqusition Department Electromagnetic Geoservices ASA

ELECTROMAGNETIC GEOSERVICES IN BRIEF

EMGS IN BRIEF • Pioneered the EM industry • ~300 employees • Listed on OSE March 2007 • Technology & market leader • Worldwide experience • 2012 revenues: USD 201 million • Delivered >700 surveys • Efficient & stable operations • 2012 EBITDA: USD 56 million

WORLDWIDE EXPERIENCE AND PRESENCE Include PNG Survey water depths from ~ 30 to 3500 metres in mature and frontier basins worldwide

CUSTOMERS AND TRACK RECORD Delivered more than 700 surveys Unmatched technology, knowledge and experience Staffed with the world’s leading experts in EM

THE VALUE OF EM Customers use 3 D EM data to: • Provide early indications of hydrocarbon prospectivity in frontier areas • Test and rank seismic prospects • Find bypassed and satellite fields in mature areas • Prioritize drilling locations • Improve delineation of reservoirs • Better understand geological features such as salt, basalt and carbonates

EXPLORATION BY USE OF ELECTROMAGNETICS

RESISTIVITY – A KEY HYDROCARBON INDICATOR Well log resistivity [ m] 10 Water-bearing sediments: 1 - 2 Ωm Hydrocarbon reservoirs: 10 - 100 Ωm -1 0 10 1 10 2 10 3 10 4 10 Hydrocarbon reservoirs display high resistivity

THE CSEM METHOD EM source towed above receivers EM receivers dropped on the seabed EM data indicated reserves

SEISMIC MAPS STRUCTURES Depth [m] Data courtesy of Murphy Seismic flat spot indicates a potential reservoir.

CSEM MAPS RESISTIVITY – A KEY HYDROCARBON INDICATOR • Sensitive to pore fluids and saturation RESISTIVITY An EM anomaly confirmed a seismic flat spot, both laterally and in depth. Therefore, the risk of drilling a low-saturation, non-commercial reservoir was reduced. The subsequent well encountered a good-quality gas reservoir with saturation of commercial potential.

A FULL SUITE OF SERVICES Pre-survey analysis 3 D EM data acquisition Processing and imaging Sensitivity study Full-azimuth 3 D CSEM Survey design and optimisation Magnetotelluric (MT) Offshore quality control & data conditioning 3 D and 2. 5 D inversion Integrated interpretation

INDUSTRY-LEADING EQUIPMENT AND CAPACITY SOURCE Most powerful and stable source 3 D EM VESSELS High capacity with full redundancy RECEIVERS Up to 200 receivers per vessel

THE EM FLEET

“ERP” IN EMGS 10 years in business – a case study of ERP development: 2004: Excel Spread Sheets 2005: Infor Datastream (5 vessels in operation) 2006: Lotus Notes QHSE MS 2007: IFS (Listed on OSX) 2007: Agresso (Passed 300 employees) 2008: STAR IPS and CPS replaces Infor Datastream and integrates with SBLWiz 2012: Intelex Technologies replaces Lotus Notes due to poor acceptance of by employees 2014: IFS to replace STAR?

RESOURCES – ASSET MANAGEMENT MAINTENANCE MANAGEMENT • Documents • Preventive Maintenance • Corrective Maintenance • Fault reporting • Statistics LOGISTICS • Inventory Control • Material Requisitions • Shipment Management REPLICATION ONSHORE & OFFSHORE DATABASES

RESOURCES – PERSONNEL – HR MANAGEMENT ONSHORE DATABASE • • • Employee registry Activity reporting Salary Crewing Management Crew CV Management

RESOURCES – PERSONNEL – QHSE MANAGEMENT • • Standards Procedures Competency Compliancy QHSE Statistics REPLICATION ONSHORE & OFFSHORE DATABASES Data logged onboard: • Incidents • Nonconformities • Training Management • Audits • Drills • Job Safety / RA • Meetings In addition: • Document Control System

RESOURCES – FINANCE ONSHORE DATABASE FINANCE & ACCOUNTING • • • Invoicing Payment Survey project planning Rigging of vessels Technology Development

PRODUCTION FOLLOW UP – KEY PERFORMANCE INDICATORS

LESSONS LEARNED

LESSONS LEARNED ü Replication of databases via SATCOM (256 kb/s) is challenging • Modern systems designed for broad band internet • Most systems uses one central database – design of tables need to support replication

LESSONS LEARNED ü A full integrated ERP system or a collection of multiples? • Several systems reduces risk – one defect system doesn’t affect the entire operation • User interface – for whom is the system designed and by whom? • License management and costs? • Database integration - bridging

LESSONS LEARNED ü Adapt to workflow or to solution? • Workflows / processes in small companies are constantly shifting • Annual organisational changes • COTS solutions provides a quick solution but is restricting innovation

LESSONS LEARNED ü • • Knowhow about databases opens for interaction with alternative / temporary solutions Spread sheets for Daily Progress Report Own developed EM - processing software auto-generates WO in STAR on Receivers with bad data. Own developed hardware test tools in LABVIEW Integration with own developed tools – resources

LESSONS LEARNED ü Implementation • Ambitions set in the user requirement specification process higher than the organisations ability to achive. • Avoid too complex systems - KISS • Coding of equipment and type of failures - lack of usable standards: step by step work • Definition of KPI’s and shifting objectives • Standardisation of work flows

LESSONS LEARNED ü Training of employees • User interface depended • Use of roles – strip functionality down to “need to have” • More challenging at supervisor/manager level - leadership • Crew training is resource-demanding

LESSONS LEARNED ü Commitment • Executive level: Reporting, decision making • Mid-manager / supervisor level: Involvement, motivation, improvement focus • “Back deck” level follow ups – monthly topic