Spears Associates Wireline Market 2005 2015 Spears Associates

Spears & Associates: Wireline Market 2005 -2015 Spears & Associates, Inc. 8908 South Yale, Suite 440 Tulsa, Oklahoma 74137 USA 1(918)496 -3434 Principal Authors: Richard Spears and David Otte rspears@spearsresearch. com Q 4 2015 1

Spears & Associates: Wireline Market Table of Contents Introduction: Market Description 3 Global Wireline 6 North American Wireline 18 US Wireline 20 US Regional Wireline 26 Wireline Supply Chain 66 Market Drivers 91 Companies 99 Authors & Legal 118 2

Spears & Associates: Wireline Market Introduction: Market Description Wireline OH wireline is almost exclusively new well work Open Hole (OH) E-line Cased Hole CH wireline is both new and old well work Cased Hole (CH) E-line Slickline Wireline service performed on e-line after the borehole is protected by casing and cement. Can include formation, pipe and cement evaluation as well as perforating and other completion related service. Wireline service performed on slickline. Generally includes mechanical completion or remedial services. Evaluation services can be performed utilizing memory tools to acquire data. “E-line” refers to “electric line” - wireline that has one or more electrical conductors to pass power and data to/from downhole tools Slickline is single strand steel (nominally) wireline, no conductors Wireline service performed on e-line to acquire formation evaluation data prior to the borehole being protected with steel pipe and cement. Commonly referred to as Open Hole logging. 3

Spears & Associates: Wireline Market Introduction: Market Description • The Global Wireline Market for 2015 is $10. 8 billion. This is ~ 1. 5 X the market size in 2005 of $6. 9 billion and represents a CAGR for the period of 4. 5%. • The four major logging companies, Schlumberger, Halliburton, Baker Hughes and Weatherford, hold a combined $8. 6 billion, or ~80% of the global wireline market. This is up slightly over the 77% of the market these companies accounted for in 2014. It is a normal feature of a market retreat for the majors to hold or grow market share better than their smaller competitors. • Historically, the global wireline market revenue was split 50/50 between open hole logging (formation evaluation) vs. cased hole logging (completion services). Today, the global split is roughly 33% open hole and 66% cased hole. For the US land market the revenue split is much closer to 20% open hole and 80% cased hole and is a result of the increasing intensity of cased hole wireline service required during a multi-stage frac completion commonly performed in the horizontal unconventional well and the reluctance to acquire open hole logs in a horizontal well. • The US land wireline market is $2. 8 billion in 2015 which is nearly 5 x the offshore market of $. 6 billion. 4

Spears & Associates: Wireline Market Introduction: Oilfield Lifecycle Spending These charts show the amount of money spent annually in each of the four segments. The period is 2005 -2016. Global Market Billions $15 Activity Exploration seismic, mapping Well Construction site prep, drilling, logging, set casing, cementing OH formation evaluation, CH cement evaluation Completion wireline, frac, rental & fishing CH plug & perforate, Slickline mechanical Production well head install, flow fluids/gas, pumping, testing, monitoring, remedial CH production logging, Slickline mechanical Well Construction Exploration $20 Phase $150 Global Market Billions Wireline Service Completion $150 Global Market Billions Production $60 $100 $40 $50 $20 $0 $0 $0 Global Market Billions $~185 billion (2015) is spent annually to explore, construct, complete & produce oil & gas wells around the world. This does not include the drilling contractor. Open hole wireline services are found primarily within the well construction segment. 2015 2013 2011 2009 2007 2005 2015 2013 2011 2007 2009 2015 2013 2011 2009 2007 $0 2005 $5 2005 $10 Cased hole wireline services are found primarily within the well completion segment but are also found in the production phase as many wells require remedial cased hole work through the life of the well Source: Spears & Associates’ research 5

Spears & Associates: Wireline Market Global Wireline 6

Spears & Associates: Wireline Market Global Wireline Market $16 $11 Billion 2015 Wireline as a % of $332 Billion Global Oilfield Services $500 $450 $14 $400 3. 2% $12 Oilfield Mkt $10 $300 $8 $250 $200 $6 96. 8% $150 $4 $100 $2 $0 $0 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006 2005 Wireline is a small, 3. 2%, but vital piece of the overall oilfield services market. Wireline consistently grows and shrinks along with the broader market. This “inelasticity” indicates wireline remains an essential and important tool for the industry. $50 7 Oilfield Svcs - Billions Wireline - Billions $350

Spears & Associates: Wireline Market Spears & Associates: Hydraulic Fracturing Market Global Wireline Market $16 2015 Global Wireline Market By Region - $10. 8 Billion $14 $12 25% Billions $10 41% No. Am La. Am $8 $6 $4 Eur/CIS/Afr 23% ME/Asia 11% $0 8 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006 2005 Throughout the years, North America remains the largest market region but has dropped to 41% from 2014’s 50% $2

Spears & Associates: Wireline Market Global Wireline Logging 2015 - Global Wireline Market By Region By Type $ in Billions 2015 Open Hole Cased Hole Total No. Am $0. 8 $3. 1 $3. 9 La. Am $0. 9 $0. 7 $1. 6 Eur/Afr/CIS $1. 4 $1. 1 $2. 5 ME/Asia $1. 5 $1. 3 $2. 8 TOTAL $4. 5 $6. 3 $10. 8 9

Spears & Associates: Wireline Market Global Wireline Market 10

Spears & Associates: Wireline Market 2015 -2020 estimated CAGR: 8% Global Wireline Logging 1% 1% 1% 10% 1% 2% 2% 2% 6% KEY FACTS 10% The 2005 -2014 CAGR of this sector has been 8%, due mainly to growth in cased hole logging services on land in North America bringing the Global Wireline Market to ~ $15 billion in 2014. Like most oilfield service market, wireline suffered a precipitous decline in 2015 of 29% to ~$11 billion. During the period 2015 -2020 we are forecasting an 8% CAGR – continuing at the same pace as the prior decade. Horizontal wells consume 2. 5 x the products of a vertical well, positively impacting wireline in the US. The major service companies represent ~80% of the wireline market, just like the completions market. 17% Each of these companies have segment revenues in excess of $100 million $16, 000 $14, 000 $12, 000 $10, 000 Millions Wireline logging, as a well intervention technique, is growing in popularity both on and offshore, where subsea well intervention is now commonly performed with a wireline and no drill ship. 47% SLB HAL BHI WFT C&J SPN COSL EXPRO Archer AHWS Qinterra AS Others $8, 000 $6, 000 $4, 000 $2, 000 $0 11 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006 2005 Source: Spears & Associates’ Oilfield Market Report, 2015

Spears & Associates: Wireline Market Global Wireline Logging Source: Spears & Associates’ Oilfield Market Report, 2015 12

Spears & Associates: Wireline Market Global Wireline Logging Global Market Share Companies Ranked by Total Revenues $6, 000 100% 90% $5, 000 80% 70% $4, 000 Million 60% All Others 50% $3, 000 BHI HAL 40% $2, 000 SLB 30% 20% $1, 000 0% 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006 2005 FMC Renegade GE Pioneer J-W Wireline Qinterra Allied Horizontal Archer COSL Expro C&J SPN WFT BHI HAL SLB $0 10% 13

Spears & Associates: Wireline Market Global Wireline Logging One measure of a market’s growth is the year-to-year change of the intensity with which the product/service is used. The measure we use on this page is market size divided by number of rigs running. The chart below divides the wireline logging global market by the number of actively drilling rigs worldwide. In 2005 about $2. 5 million wireline services per active rig were sold each year. In 2015 the number has grown to $4. 5 million and continues to rise. The intensity of growth of this market is still strong. Millions of Dollars Spent on Wireline Logging Each Year Per Active Rig around the World $5. 0 $4. 5 $4. 0 $3. 5 $3. 0 $2. 5 $2. 0 $1. 5 $1. 0 $0. 5 $0. 0 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 14

Spears & Associates: Wireline Market Wireline Logging Global Wireline Market with Wells Drilled Roughly 50% of wireline dollars are earned in NAM so a fair correlation with NAM activity is expected 15

Spears & Associates: Wireline Market Annual Market Change 40% Total Oilfield Equipment & Service Market Annual Change 30% 20% 10% 0% -10% 2006 2007 2008 2010 2011 2012 2013 2014 2015 2016 -20% -30% -40% The total oilfield equipment & service market grows & falls sharply, surging >30% some years, growing 5% some years… 40% Wireline Market Annual Change 30% Annual Change 2009 The period 2006 -2008 was characterized by rapid growth of nearly 20% each year followed by sudden collapse in 2009. Lean manufacturing of wells since 2012 has slowed the growth rate to ~ 8%. Followed by the market collapse in 2015. 20% 10% 0% -10% 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 -20% -30% -40% 16

Spears & Associates: Wireline Market Global Well Completion Market $140 Wireline is a sub-segment within the well completion market. The well completion market has been one of the highest growth segments of the global oilfield due largely to increasing demand for hydraulic fracturing, cased hole wireline services and expanding coiled tubing roles. -33% $120 $100 Hydraulic Fracturing $4. 6 $5. 7 Subsea Equipment $24. 4 $5. 7 Billions 2015 Global Well Completion Market - $85 B Wireline Logging Completion Equipment & Services $5. 9 $80 % $60 AG $40 200 Rental & Fishing Services Surface Equipment $10. 0 8 R– 5 C 015 2 – $20 Coiled Tubing Services $18. 3 $0 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006 Production Testing 2005 $10. 8 17

Spears & Associates: Wireline Market North American Wireline 18

Spears & Associates: Wireline Market Wireline Logging 2015 - No. Am Wireline Market By Type $ in Billions Open Hole Cased Hole Total U. S. Offshore $0. 3 $0. 6 U. S. Land $0. 4 $2. 8 Canada $0. 15 $0. 4 $. 55 TOTAL $. 75 $3. 1 $3. 9 19

Spears & Associates: Wireline Market US Wireline Market Overview 20

Spears & Associates: Wireline Market Wireline Cost Index Q 1 2008 = 1. 00 1. 20 1. 10 1. 00 0. 90 0. 80 0. 70 0. 60 Q 116 Q 115 Q 1 14 Q 1 13 Q 1 12 Q 1 11 Q 1 10 Q 1 09 Q 1 08 Spears undertakes a quarterly survey of independent well engineering and wellsite supervision firms to collect “spot market” drilling and completion services price information for a specific set of commonly drilled wells in the US. The information in the “well profile” survey is collected in the form of detailed drilling and completion services cost estimates based on current unit prices and usage rates in each location at the end of the quarter. Overall Well Cost Index 1. 30 Technical Services (includes Wireline) Cost Index 1. 40 1. 30 1. 20 Q 1 2008 = 1. 00 Costs for wireline work on land in the US have the same cycle as total D&C costs, but are less exaggerated. As the cost index illustrates, the collapse in wireline pricing in 2008 and 2009 was less extreme than total well costs. However, the rebound in prices through 2011 was about the same as the overall market. The collapse in oil prices late in 2014 placed a materially downward bias on wireline pricing through 2015. 1. 10 1. 00 0. 90 0. 80 0. 70 0. 60 Q 116 Q 115 Q 1 14 Q 1 13 Q 1 12 Q 1 11 Q 1 10 Q 1 09 Q 1 08 21

Spears & Associates: Wireline Market US Regional Wireline Markets $8, 000 2015 – Wireline Market By US Region $3. 4 Billion $7, 000 $6, 000 10% 18% Permian Basin East Texas/Haynesville Mid. Continent 21% 7% Bakken Other Rockies Northeast 3% West Coast Gulf Coast 9% 8% 5% 9% 10% Gulf of Mexico Millions So. Texas/Eagle Ford $5, 000 $4, 000 $3, 000 $2, 000 $1, 000 $0 Gulf of Mexico Gulf Coast West Coast Northeast Other Rockies Bakken Mid. Continent East Texas/Haynesville Permian Basin So. Texas/Eagle Ford 2011 $382 $234 $188 $431 $406 $511 $720 $681 $409 $508 2012 $562 $316 $212 $419 $449 $590 $806 $498 $644 $647 2013 $670 $355 $237 $465 $438 $623 $774 $514 $809 $738 2014 $700 $423 $278 $535 $435 $698 $837 $683 $1, 352 $759 2015 $600 $249 $111 $304 $163 $324 $355 $279 $705 $333 2016 $600 $178 $82 $227 $115 $221 $261 $199 $537 $226 22

Spears & Associates: Wireline Market US Regional CH Wireline Markets $6, 000 2015 – CH Wireline Market By US Region - $2. 7 Billion $5, 000 11% Permian Basin East Texas/Haynesville 8% Millions So. Texas/Eagle Ford $4, 000 $3, 000 Mid. Continent Bakken 4% 25% Other Rockies $2, 000 $1, 000 Northeast 10% West Coast Gulf Coast 5% Gulf of Mexico 8% 8% 10% The Permian remains the dominant CH market in 2015. Horizontal well drilling is on the rise in the Permian driving increased service intensity for cased hole wireline services. $0 Gulf of Mexico Gulf Coast West Coast Northeast Other Rockies Bakken Mid. Continent East Texas/Haynesville Permian Basin So. Texas/Eagle Ford 2011 $191 $155 $156 $349 $220 $354 $589 $543 $285 $358 2012 $281 $218 $177 $348 $247 $417 $670 $368 $511 $530 2013 $335 $273 $209 $400 $258 $468 $656 $394 $680 $618 2014 $350 $339 $251 $489 $300 $551 $720 $543 $1, 221 $659 2015 $300 $207 $104 $280 $125 $214 $315 $223 $671 $289 2016 $300 $156 $79 $214 $95 $164 $241 $170 $513 $203 23

Spears & Associates: Wireline Market US Regional OH Wireline Markets $1, 600 2015 – OH Wireline Market By US Region - $. 66 Billion $1, 400 $1, 200 7% Permian Basin 5% East Texas/Haynesville Mid. Continent 8% Bakken 45% 6% Other Rockies Northeast West Coast 11% Gulf Coast Gulf of Mexico 6% 6% 1% 4% Millions So. Texas/Eagle Ford $1, 000 $800 $600 $400 $200 $0 Gulf of Mexico Gulf Coast West Coast Northeast Other Rockies Bakken Mid. Continent East Texas/Haynesville Permian Basin So. Texas/Eagle Ford 2011 $191 $79 $33 $82 $185 $157 $131 $138 $124 $150 2012 $281 $98 $35 $72 $203 $174 $136 $129 $133 $116 2013 $335 $83 $28 $65 $180 $154 $119 $120 $128 $120 2014 $350 $84 $27 $46 $135 $147 $117 $140 $131 $100 2015 $300 $42 $7 $24 $38 $76 $40 $56 $33 $44 2016 $300 $22 $4 $13 $20 $58 $21 $29 $24 $23 24

Spears & Associates: Wireline Market US Regional Wireline Markets 25

Spears & Associates: Wireline Market US Regional Wireline Markets 26

Spears & Associates: Wireline Market Bottom Hole Temperatures The complexity of wireline technology is highly correlated to bottom hole temperature. High temperatures require downhole tools and wireline designed for the task. Risk of failure rises as the design requirements increase. Wireline jobs are carefully planned in the hotter environments to limit time spent in the wellbore. Temperature in degrees F at true vertical depth Region 5, 000’ 10, 000 15, 000’ South Texas 170 275 400 Permian 135 190 250 Haynesville 160 250 350 Mid. Continent 150 210 275 Niobrara 175 260 Based on an evaluation of several thousand wireline and MWD records, Spears has confirmed that the two hottest plays in the US are South Texas and the Haynesville. 27

Spears & Associates: Wireline Market Eagle Ford / South Texas The Eagle Ford is a play that spans at least 25 counties in Texas Rail Road Commission districts 1, 2, 3, 4 and parts of 5. By comparison, the largest oil & gas play on land in the last 75 years was the East Texas gas field which covered one entire county and parts of 4 others. Maps provided by the state of Texas (seen below) show the locations of these RRC districts and the extent of the specific Eagle Ford play. This report focuses on the Eagle Ford, but the region includes a variety of other well types. RRC district 4, for example, has some of the deepest and hottest vertical gas well drilling in the country. RRC district 1 has the original Austin Chalk horizontal play that proved to the industry that horizontal drilling was a valuable tool. Source: Spears & Associates, Inc. / Oilfield Logix Series 28

Spears & Associates: Wireline Market South Texas: Description New Well Drilling Activity New well construction fell sharply in 2015 due to global oil prices falling from $95 to $55, dipping to $45 early in 2015. This decline in oil prices will cut drilling in South Texas by 40%. 4, 500 4, 000 3, 500 New Wells Drilled Horizontal drilling in pursuit of the Eagle Ford’s oil is the predominant technique in South Texas, but there is still a small vertical well drilling industry. Vertical drilling has an enormous depth range with most of these pursuing natural gas. The greatest percentage decline in drilling has been felt in the vertical well category. The dominance of horizontal wells coupled with multistage “plug & perf” completions in the Eagle Ford create significant demand for cased hole wireline services. 3, 000 2, 500 2, 000 1, 500 1, 000 500 0 Vertical Horizontal/Directional 2013 319 3, 516 2014 252 3, 573 Horizontal/Directional 2015 95 2, 181 2016 107 2, 223 2017 125 2, 501 Vertical Source: Spears & Associates, Inc. / Oilfield Logix Series 29

Spears & Associates: Wireline Market South Texas Region 2015 DRILLING/COMPLETION/PRODUCTION SPENDING ~$11 billion will be spent in South Texas and its Eagle Ford play during the course of 2015. 37% of the $11 billion will be spent constructing wells, 44% completing wells, and 19% producing wells. Completions companies receive not quite one out of every two dollars spent on services in the basin. $333 million 2015 South Texas Wireline Market 13% Cased Hole The top three spend categories are hydraulic fracturing (19% of the basin’s total spend), contract drilling (11%) and water management (10%). Open Hole South Texas represents 12% of the total US land market. 87% Source: Spears & Associates, Inc. / Oilfield Logix Series 30

Spears & Associates: Wireline Market South Texas Cased hole logging is the primary wireline work found in South Texas. Certainly in the Eagle Ford. But for the occasional open hole log taken in a moderately exploratory hole, most wireline work is limited to cement bond longs, plug & perf work and setting packers. Wireline – S Texas $800 $700 As shown in the neighboring chart, the region’s wireline market is ~$0. 33 billion in 2015. This is down from $0. 8 billion in 2014 as frac activity fell and prices dropped. We don’t expect a significant recovery in 2016. $ in Millions $600 $500 $400 South Texas is served by a number of cased hole wireline logging companies, including: $300 $200 $100 $0 OH CH 2011 $150 $358 2012 $116 $530 2013 $120 $618 2014 $100 $659 2015 $44 $289 2016 $23 $203 Allied Horizontal Wireline Archer Ark. La. Tex Baker Hughes C&J/Cased Hole Solutions Halliburton Schlumberger Weatherford Spears & Associates, Inc. / Oilfield Logix Series 31

Spears & Associates: Wireline Market South Texas: Frac Stages / Well Distribution of Total Number of Frac Stages per Well 6 5 Shallow South Texas wells have <10 stages in each frac (typically just 1 -2). Horizontal wells range from 12 -30 stages, with the typical horizontal well frac pumping 15 -16 stages, but there is a strong trend to more stages each year. Wells in Sample 4 3 2 1 0 10 11 12 13 14 15 16 17 18 19 20 21 22 Number of Frac Stages 23 24 25 26 27 28 Frac Stages per well are a direct driver of cased hole wireline work as plug-n-perf is the predominant completion technique utilized in the Eagle Ford. Each frac stage will have an accompanying wireline run to set a plug and perforate to enable the next frac stage. 29 30 32

Spears & Associates: Wireline Market Spears & Associates: Hydraulic Fracturing Market South Texas: Lateral Length Distribution of Horizontal Lateral Lengths 35 Average Completed Length of HW 2012 5, 015’ 2013 5, 407’ 2014 5, 829’ 2015 6, 000’ 25 South Texas horizontal wells have laterals that range from 3, 000’ to 10, 000’. The most common lateral length is ~5, 500’. Each year operators are drilling laterals 5 -10% longer than the prior year. 20 15 10 5 0 00 00 0, 1 , 5 00 9 , 0 00 9 , 5 00 8 , 0 00 8 , 5 00 7 , 0 00 7 , 5 00 6 , 0 00 6 , 5 00 5 , 0 00 5 , 5 00 4 , 0 00 4 , 5 00 3 , 0 00 3 , 5 00 2 , 0 00 2 , 5 00 1 1 , 0 00 0 5 Wells in Sample 30 Year Lateral Length (ft. ) Lateral length of the well bore is a good indicator of how many frac/wireline stages will be utilized per well. Longer lateral lengths also increase the complexity and inherent risks associated with a wireline completion. 33

Spears & Associates: Wireline Market Permian Basin The Permian Basin consists of Texas Rail Road Commission Districts 7 C, 8 and 8 A, along with southeast New Mexico. The Permian Basin has two distinct models of development. The first is in the Midland sub-basin, where vertical drilling still reigns. But while operators have hydraulically fractured vertical wells here since the 1950 s, technological advancements are allowing them to drill deeper and tap more formations. Today, companies are using hydraulic fracturing to exploit a series of formations spanning a 4, 500 -foot vertical zone. Producing reservoirs include the Yates, San Andres, Clear Fork, Spraberry, Wolfcamp, Yeso, Bone Spring, Avalon, Canyon, Morrow, Devonian, and Ellenberger, with depths from a few hundred feet to five miles below the surface. The second development model is in the Delaware sub-basin that stretches from southeastern New Mexico into far West Texas. Production in this area relies on a combination of hydraulic fracturing and horizontal drilling. Delaware drilling is largely focused on the Avalon Shale and the tri-layered Bone Spring sands — although the Wolfcamp formation is also present. The Wolfcamp formation is deeper in the Delaware basin and tends to be gassier. Given the longer reach of horizontal wells as well as the higher number of fracturing stages used to complete them, well costs are a much higher $5 million to $7 million. The Permian remains a fast growing drilling province this year as operators switch from drilling individual vertical wells to horizontal wells off of multiple well pads. This conversion has had a fundamental impact on demand for equipment and services. As a result, investment is pouring into the region to satisfy this remarkable demand. Spears & Associates, Inc. / Field Logix Series 34

Spears & Associates: Wireline Market Spears & Associates: Hydraulic Fracturing Market Permian Basin: Description New Well Drilling by Type Since the Permian Basin is characterized by layers of oil-bearing rock stacked one on top of the other for thousands of feet, operators have to make the following choice: Do I drill vertically and tap all the stacked reservoirs, or do I select a single reservoir and tap it with a horizontal well? In the recent past, most operators chose to drill vertically, but half the wells drilled today in the basin are horizontal. Spears has chosen a conservative longer term outlook for Permian Basin oil-directed drilling. If oil prices do not rise significantly, and if the cost of drilling increases, some incentive to drill will be removed. We believe that lingering low oil prices will constrain E&P spending through 2016. 16, 000 14, 000 12, 000 10, 000 8, 000 6, 000 4, 000 2, 000 0 Vertical Horizontal/Directional 2013 10, 452 2, 766 2014 9, 561 4, 727 2015 4, 509 3, 241 2016 3, 626 3, 316 2017 4, 458 3, 731 The Permian Basin has the largest ratio of vertical to horizontal wells of any US region creating opportunities for open hole logging. Many of these wells require salt based mud systems which require Laterolog type resistivity tools. Spears & Associates, Inc. / Field Logix Series 35

Spears & Associates: Wireline Market Permian Basin $705 million 2015 Permian Basin Wireline Market 2015 DRILLING/COMPLETION/PRODUCTION SPENDING 5% ~$19 billion will be spent in the Permian during the course of 2015. 33% of the $19 billion will be spent constructing wells, 43% completing wells, and 24% producing wells. The top three spend categories are hydraulic fracturing (18% of the basin’s total spend), contract drilling (11%) and water management (11%). Cased Hole Open Hole 95% Spears & Associates, Inc. / Oilfield Logix Series 36

Spears & Associates: Wireline Market Permian: Wireline Market Shares Estimated Market Share of Logging Service Companies Formation evaluation in Permian is done on the wireline mostly, with a bit of LWD off the drill string. Open hole logging is done in the region, but it is almost exclusively in vertical wells. 4% Halliburton 2% 3% 4% As the chart to the right indicates, the three majors: Baker Hughes, Halliburton, and Schlumberger have the primary market shares, along with a larger independent, Capitan. Weatherford rounds out the top 75%, followed by more larger independents. Allied Horizontal Wireline, which is commercializing GE’s digital open hole logging technology, has 5% of the market, a 3% increase from last year. A significant portion of wireline work is done in the cased hole. This is reflected in the market shares of the independents, most of whom work exclusively in cased hole environments. Schlumberger 20% Weatherford Capitan 5% Baker Hughes Casedhole Solutions 7% Gray Wireline (Archer) Allied Wireline 7% 19% Jones Wireline Pioneer 7% Renegade Services 7% Other 13% Spears & Associates, Inc. / Oilfield Logix Series 37

Spears & Associates: Wireline Market Permian Basin Wireline – Permian Basin As shown in the neighboring chart, the region’s wireline market is ~$. 7 billion in 2015. This is up from just $0. 4 billion in 2011. The large increases in 2013 and 2014 are due to increased number of horizontal completions The Permian is served by numerous cased hole wireline logging companies. $1, 600 $1, 400 $1, 200 $ in Millions Cased hole wireline dominates the wireline work found in the Permian. Most new well wireline work is limited to cement bond longs, plug & perf work and setting packers. With the numerous old wells found in the Permian, remedial wireline work is also common. $1, 000 $800 $600 $400 $200 $0 OH CH 2011 $124 $284 2012 $133 $511 Spears & Associates, Inc. / Oilfield Logix Series 2013 $128 $680 2014 $131 $1, 221 2015 $33 $671 2016 $24 $513 38

Spears & Associates: Wireline Market Permian Basin: Total Measured Deptrh Vertical well depths in the Permian range from shallow (1, 500’) to deep (>17, 000’). The chart below shows the depth distribution of several hundred wells drilled in the last few years. Distribution of Total Measured Depth 90 80 60 50 40 Vertical Wells 30 Horizontal Wells 20 10 , 0 0 2 0 , 0 0 3 0 , 0 0 4 0 , 0 0 5 0 , 0 0 6 0 , 0 0 7 0 , 0 0 8 0 , 0 0 9 0 , 0 1 00 0, 0 1 00 1, 0 1 00 2, 0 1 00 3, 0 1 00 4, 0 1 00 5, 0 1 00 6, 0 1 00 7, 0 1 00 8, 0 1 00 9, 0 2 00 0, 0 2 00 1, 0 2 00 2, 0 2 00 3, 0 2 00 4, 00 0 0 1 Wells in Sample 70 Included on the same graph is a distribution of horizontal well depths. The measured depth of horizontal wells has increased recently from ~15, 000’ to 22, 000’. Although more horizontal wells are being drilled, vertical wells are still a main tool used in the basin. Total Measured Depth (ft. ) Spears & Associates, Inc. / Oilfield Logix Series 39

Spears & Associates: Wireline Market Permian: Lateral Length Lateral lengths of horizontal wells have been getting longer each year. In 2012 the average length was ~3, 900’ and in 2013 the length reached ~4, 200’, with a big leap to 5, 100’ in 2014. The chart below plots the distribution of horizontal lateral lengths of a couple hundred horizontal wells drilled in the last two years. The longest lateral in each year is ~8, 000’, but the most frequently drilled lateral 4, 400’ Year Average Lateral Length of HW 2012 3, 900’ 2013 4, 200’ 2014 5, 100’ Distribution of Horizontal Lateral Lengths 120 Wells in Sample 100 80 60 40 20 0 400 800 1, 2, 2, 3, 4, 4, 5, 6, 6, 7, 8, 20 60 00 40 80 20 60 00 0 0 0 Lateral 0 0 Length 0 (ft. ) 0 0 0 0 0 Spears & Associates, Inc. / Oilfield Logix Series 40

Spears & Associates: Wireline Market Permian Basin: Frac Stages / Well Distribution of Total Number of Frac Stages per Well 350 300 Shallow Permian Basin wells have 1 -2 stages in each frac (typically just 1). Horizontal wells range from 3 -13 stages, with the typical horizontal well frac pumping 8 -10 stages, but there is a strong trend emerging for 16 -17 stages per well. Wells in Sample 250 200 150 100 50 0 1 2 3 4 5 6 7 8 9 10 11 12 13 Number of Frac Stages 14 15 16 17 18 19 20 Frac Stages per well are a direct driver of cased hole wireline work as plug-n-perf is the predominant completion technique utilized in the Eagle Ford. Each frac stage will have an accompanying wireline run to set a plug and perforate to enable the next frac stage. Spears & Associates, Inc. / Oilfield Logix Series 41

Spears & Associates: Wireline Market East Texas/Haynesville: Description The East Texas/North Louisiana region includes a wide range of drilling projects, including the Haynesville, which is a deep, hot, high pressure horizontal shale development, and the shallower, old Travis Peak/Cotton Valley reservoirs of East Texas. We also find several shallow reservoirs that have been developed for decades. In Texas, this region includes Rail Road Districts 5 and 6, with a bit of bleed-over into District 3. In Louisiana, the region is primarily found within a 50 mile radius of Shreveport. 42

Spears & Associates: Wireline Market Spears & Associates: Hydraulic Fracturing Market East Texas/Haynesville New Well Drilling Activity by Type 4, 000 New Wells Drilled 3, 500 3, 000 2, 500 New well construction in this region is higher than it has been in previous years, hitting almost 3, 500 new wells in 2014. The market should start to see a significant drop in the coming years as drilling in the US slows down. Horizontal drilling in pursuit of the region’s gas is slowly becoming the more dominant drilling method. ~2, 000 horizontal wells were drilled in 2014 and although overall activity will fall off, the majority of wells will still be horizontal/directional. 2, 000 1, 500 1, 000 500 0 Vertical Horizontal/Directional 2012 1, 154 1, 498 2013 1, 056 1, 585 2014 1, 260 2, 093 2015 519 1, 384 2016 404 1, 256 43

Spears & Associates: Wireline Market E. Texas: Cased Hole Wireline Cased hole logging is the primary wireline work found in the region. But for the occasional open hole log taken in a vertical hole, most wireline work is limited to cement bond longs, plug & perf work and setting packers. As shown in the neighboring chart, the region’s wireline market was ~$0. 4 billion in 2015. This is expected to drop in the next few years. J-W Wireline, now owned by FTI, the frac service company, has the leading cased hole market share. East Texas/Haynesville Cased Hole Wireline Market $600 33% $500 44% Millions $400 J-W Wireline Pioneer Wireline WW Wireline $300 $200 22% $100 $0 CH Wireline 2012 $368 2013 $394 2014 $543 2015 $223 2016 $170 Spears & Associates, Inc. / Oilfield Logix Series 44

Spears & Associates: Wireline Market E. Texas: Formation Evaluation Formation evaluation in East Texas/North Louisiana is done off of the drill string, using an openhole wireline log and using mud logging/surface data logging. Schlumberger is the leading formation evaluation service company, followed by Baker Hughes and Halliburton. Several other service companies have been identified. OH Wireline Spending 4% $160 2%1% 5% Schlumberger 4% $140 35% $120 Halliburton 10% Millions $100 Weatherford Pioneer $80 $60 Tucker Energy 13% Archer/Great White $40 Admyr Wireline $20 $0 OH WL Baker Hughes 27% 2012 $129 2013 $120 2014 $140 2015 $56 Others 2016 $29 Spears & Associates, Inc. / Oilfield Logix Series 45

Spears & Associates: Wireline Market East Texas/Haynesville: Frac Stages / Well Year of Completion Average Number of Frac Stages 2012 9 2013 11 2014 15 Distribution of Number of Frac Stages per Well 35 30 Wells in Sample 25 Frac stages is one of the metrics regularly quoted by analysts working in this industry. Except for those companies providing plug & perf technologies, this is not a very meaningful statistic. In the Haynesville, as many as 30 frac stages have been pumped in a single well. As the table above shows, number of stages pumped have been slowly increasing since 2012. 20 15 10 5 0 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 32 34 36 38 40 Number of Frac Stages Spears & Associates, Inc. / Oilfield Logix Series 46

Spears & Associates: Wireline Market Haynesville, E. Texas: Lateral Length of horizontal wells has been getting longer each year. In 2012 the average length was ~3, 900’ and in 2013 the length was ~4, 200’. Using the 2012 -2014 data, well lengths are increasing 5% per year…or ~200’. The chart below plots the distribution of lateral lengths of more than 100 horizontal wells drilled in the last three years. The most frequently drilled lateral is around 4, 500’ – 5, 000’ In 2012 and 2013, operators drilled a large number of laterals shorter than 4, 000’. More and more wells are having laterals of 4, 000’ and greater. Year Average Lateral Length of HW 2012 3, 900’ 2013 4, 200’ 2014 4, 300’ 2015 4, 500’ Distribution of Horizontal Lateral Lengths 20 18 16 Wells in Sample 14 12 10 8 6 4 2 0 400 800 1, 2, 2, 3, 4, 4, 5, 6, 6, 7, 8, 20 60 00 40 80 20 60 00 0 0 0 Lateral 0 0 Length 0 (ft. ) 0 0 0 0 0 Spears & Associates, Inc. / Oilfield Logix Series 47

Spears & Associates: Wireline Market Mid. Continent: Description The Mid Continent spans a region including Western Oklahoma, the Texas Panhandle, and Kansas. And while gas well drilling is depressed in North Texas, we are including that play as well. The area is the site of much production from both deep and shallow conventional reservoirs as well as some emerging unconventional plays: Mid. Continent Granite Wash: Tight oil formation located in western Oklahoma and the Texas panhandle. It produces oil, gas, and liquids-rich gas. Key operators in the area include Chesapeake, Apache, Devon, and Cimarex. Mississippi Lime: Tight oil formation centered along the Oklahoma-Kansas border. Barnett Shale: Famous North Texas region that kicked off the unconventional natural gas horizontal development craze. Fayetteville Shale: The successor to the Barnett Shale boom, located across the center portion of Arkansas. Other basins include the Arkoma and Anadarko Basins of Oklahoma, plus several others. 48

Spears & Associates: Wireline Market Mid. Continent: Description 9, 000 8, 000 About 18% of the new wells constructed in the US this year will be in the Mid. Continent region. With drilling in the natural gas shales depressed due to low natural gas prices and will oil-directed drilling down significantly, this region’s drilling has fallen to about 4, 500 new wells per year until rising commodity prices bring oil and gas drilling back to life. Vertical drilling should remain stable at 3, 000 new wells per year while horizontal drilling is struggling at less than half its 2014 level. 7, 000 6, 000 5, 000 Vertical 4, 000 Horizontal 3, 000 2, 000 1, 000 0 2013 2014 2015 Spears & Associates, Inc. / Oilfield Logix Series 2016 2017 49

Spears & Associates: Wireline Market Mid. Continent Cased hole wireline dominates the wireline work found in the Midcontinent. Most new well wireline work is limited to cement bond longs, plug & perf work and setting packers. Wireline – Mid. Continent $900 As shown in the neighboring chart, the region’s wireline market is ~$. 46 billion in 2015. This is down from ~$0. 7 billion in 2011. $800 A few notable companies operating in the area include: $600 $ in Millions Allied Horizontal Wireline Archer C&J/Cased Hole Solutions Pioneer Halliburton Schlumberger Weatherford $700 $500 $400 $300 $200 $100 $0 OH CH 2011 $131 $589 2012 $136 $670 Spears & Associates, Inc. / Oilfield Logix Series 2013 $119 $656 2014 $117 $720 2015 $40 $315 2016 $21 $241 50

Spears & Associates: Wireline Market Mid. Continent: Frac Stages / Well Distribution of Total Number of Frac Stages per Well 40 35 Wells in Sample 30 Shallow vertical wells overwhelm this analysis…showing 1 stage per well in shallow wells. And horizontal wells show no clear tendency at all, from 3 stages to 24 stages. 25 20 15 10 5 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 Number of Frac Stages Spears & Associates, Inc. / Oilfield Logix Series 51

Spears & Associates: Wireline Market Mid. Continent: Lateral Length Completed length of horizontal wells has been getting longer each year. In 2013 the average length was ~4, 200’ and in 2015 the length reached ~5, 700’. New wells drilled 2013 -2015 have laterals growing by several hundred feet per year. In 2010 and 2011, operators drilled a large number of laterals shorter than 3, 000’ as they experimented with the Mississippi Lime and other new plays. With the maturing of these plays, very few shorter laterals are being drilled. Year Average Completed Length of HW 2013 4, 200’ 2014 4, 400’ 2015 5, 700’ A few very long laterals are appearing – almost 10, 000’. This is still too few to be considered a trend. Distribution of Horizontal Lateral Lengths 70 50 40 30 20 10 Spears & Associates, Inc. / Oilfield Logix Series 9, 600 9, 200 8, 800 8, 400 8, 000 10, 000 Lateral Length (ft. ) 7, 600 7, 200 6, 800 6, 400 6, 000 5, 600 5, 200 4, 800 4, 400 4, 000 3, 600 3, 200 2, 800 2, 400 2, 000 1, 600 1, 200 800 0 400 Wells in Sample 60 52

Spears & Associates: Wireline Market Bakken/Williston: Description The Rockies includes the following states: North Dakota, Montana, Wyoming, Colorado and Utah. The area is large, the drilling diverse, the activity erratic, but there is no question that it contains one of the most important plays ever to be discovered in the US: The Williston Basin’s Bakken: The deep, highly prolific, young play that spans North Dakota, Montana and extends north into two Canadian provinces. This report addresses the US portion. A horizontal play with pad drilling and 10, 000’ laterals. 53

Spears & Associates: Wireline Market Bakken/Williston: Description 3, 000 About 6% of the new wells constructed in the US this year will be in the Williston Basin, which includes the Bakken. This oil-rich play has captured the attention of oil companies, service companies and investors of all types Total drilling in 2015 will reach ~1, 200, of which almost all are Horizontal/Directional. Given low oil and gas prices, the outlook for drilling in 2016 calls for another 10 -15% decline, followed by a recovery in 2017. 2, 500 2, 000 Vertical 1, 500 Horizontal 1, 000 500 0 2013 2014 2015 Spears & Associates, Inc. / Oilfield Logix Series 2016 2017 54

Spears & Associates: Wireline Market Bakken/Williston: Description $. 3 billion 2015 Bakken Wireline Market 26% Almost $10 billion will be spent in the Bakken during the course of 2015. 36% of the $10 billion will be spent constructing wells, 43% completing wells, and 21% producing wells. Like most US basins, well completion is the largest of the three segments. OH CH The top three spend categories are hydraulic fracturing, water management and contract drilling. 74% Spears & Associates, Inc. / Oilfield Logix Series 55

Spears & Associates: Wireline Market Bakken Cased hole wireline dominates the wireline work found in the Bakken. The Bakken is one region in the US that some plug-perf completion work on the horizontal wells has been lost to sliding sleeve type completions. However, it appears that this trend has slowed and may be reverting back to wireline completions. A few notable companies operating in the area include: Allied Horizontal Wireline Cutters C&J/Cased Hole Solutions JW Wireline (FTS) Pioneer Halliburton Schlumberger Weatherford $800 $700 $600 $ in Millions As shown in the neighboring chart, the region’s wireline market is ~$. 3 billion in 2015. This is down from ~$0. 45 billion in 2011. We expect an additional decline of ~12% in 2016. Wireline – Bakken $500 $400 $300 $200 $100 $0 OH CH 2011 $157 $354 2012 $174 $417 Spears & Associates, Inc. / Oilfield Logix Series 2013 $154 $468 2014 $147 $551 2015 $76 $214 2016 $58 $164 56

Spears & Associates: Wireline Market Bakken: Frac Stages / Well Distribution of Total Number of Frac Stages per Well 70 Although a wide range of frac stages can be found in the Bakken, 30 stage frac jobs are by far the most common. 60 Wells in Sample 50 40 30 20 10 0 1 3 5 7 9 11 13 15 17 19 21 23 25 Number of Frac Stages 27 Spears & Associates, Inc. / Oilfield Logix Series 29 31 33 35 37 39 57

Spears & Associates: Wireline Market Lateral Length Bakken/Williston Lateral length of horizontal wells has been getting longer each year in the Bakken. In 2012 the average length was ~8, 000’ and in 2013 the length was 9, 000’. Using the 2012 -2014 data, well lengths are increasing a few hundred feet per year in the Bakken making the 2015 average 9, 500’ and the most common lateral length or median being 9, 500 – 10, 500’. Year Average Lateral Length 2013 9, 000’ 2014 9, 400’ 2015 9, 500’ The chart below plots the distribution of lateral lengths of ~200 horizontal wells drilled in the last three years. Distribution of Horizontal Lateral Length 30 20 15 10 5 Spears & Associates, Inc. / Oilfield Logix Series 13, 000 12, 500 12, 000 11, 500 11, 000 10, 500 10, 000 Lateral Length (ft. ) 9, 500 9, 000 8, 500 8, 000 7, 500 7, 000 6, 500 6, 000 5, 500 5, 000 4, 500 4, 000 3, 500 3, 000 2, 500 2, 000 1, 500 1, 000 0 500 Wells in Sample 25 58

Spears & Associates: Wireline Market Other Rockies: Description The Rockies includes the following states: North Dakota, Montana, Wyoming, Colorado and Utah. However, this section of the report addresses: Niobrara: A reservoir within the Denver-Julesberg Basin in Eastern Colorado, Eastern Wyoming and a bit of Nebraska. Operators are still trying to determine the optimal way to develop this reservoir with horizontal wells. Western Wyoming: A gas play that still has some large operators drilling wells. Piceance & Uinta: The Western Rockies with vertical drilling through highly tilted rock layers, creating a complicated drilling situation. 59

Spears & Associates: Wireline Market Other Rockies: Description 7, 000 6, 000 Total Rocky Mountain drilling in 2015 will fall to 1, 800, of which ~1, 100 are horizontal/directional and ~700 are vertical. Drilling has seen a decline since 2012, but the ratio of horizontal to vertical wells is slowly increasing. This report covers drilling in the Niobrara within the Denver-Julesberg Basin, several gas and gas liquids developments in Wyoming, gas plays in Western Colorado and Utah, and a smattering of drilling here and there. Some of the “other” drilling is shallow, vertical coalbed methane work in Wyoming. 5, 000 4, 000 3, 000 2, 000 1, 000 0 2013 2014 Horizontal Spears & Associates, Inc. / Oilfield Logix Series 2015 2016 2017 Vertical 60

Spears & Associates: Wireline Market Other Rockies: Description $. 2 billion 2015 Rockies Wireline Market 23% ~$6. 7 billion will be spent in the Rockies during the course of 2015. 37% will be spent constructing wells, 35% completing wells, and 28% producing wells. Unlike most US basins, construction is the largest of the three segments. OH The top three spend categories are water management, hydraulic fracturing and contract drilling. CH The Rockies represents about 8% of the total US land market. 77% Spears & Associates, Inc. / Oilfield Logix Series 61

Spears & Associates: Wireline Market Other Rockies Open hole wireline continues to share a larger part of the activity in the Rockies due to vertical well activity outside the Bakken. One can see the trend to less OH and more CH work in the region as we look into 2014 and beyond as horizontal wells become a larger portion of the market. A few notable companies operating in the area include: Allied Horizontal Wireline Cutters C&J/Cased Hole Solutions JW Wireline (FTS) Pioneer Halliburton Schlumberger Weatherford $500 $450 $400 $350 $ in Millions As shown in the neighboring chart, the region’s wireline market is ~$. 4 billion in 2014. This is about the same as in 2011 but shows a shift away from OH. Wireline – Other Rockies $300 $250 $200 $150 $100 $50 $0 OH CH 2011 $184 $220 2012 $202 $247 Spears & Associates, Inc. / Oilfield Logix Series 2013 $180 $258 2014 $135 $300 2015 $38 $125 2016 $20 $95 62

Spears & Associates: Wireline Market Other Rockies: Lateral Length Completed length of horizontal wells has been getting longer each year in all basins in the Rockies, which is heavily influenced by drilling in the Niobrara. The chart below plots the distribution of completed lengths of several horizontal wells drilled in the last three years in the Niobrara of Colorado. Year Average Lateral Length 2013 3, 000’ 2014 3, 400’ 2015 4, 000’ Distribution of Horizontal Lateral Lengths 12 Wells in Sample 10 8 6 4 2 0 400 800 1, 2, 2, 3, 4, 4, 5, 6, 6, 7, 8, 20 60 00 40 80 20 60 00 0 0 0 Lateral 0 0 Length 0 (ft. ) 0 0 0 0 0 Spears & Associates, Inc. / Oilfield Logix Series 63

Spears & Associates: Wireline Market Northeast: Description The Northeast US has several plays both new and old. The two primary states are Ohio and Pennsylvania, plus a bit of West Virginia. This report covers primarily Ohio and Pennsylvania and all drilling in the region. The biggest influencers of drilling and spending, however, are the Utica and the Marcellus, which have driven strong demand growth for horizontal drilling and multiple stage frac jobs. In this region, only the large operators tend to drill horizontal wells. New Well Drilling 5, 000 4, 500 4, 000 Horizontal 3, 500 Vertical 3, 000 2, 500 2, 000 1, 500 1, 000 500 0 2012 Horizontal 2, 953 Vertical 1, 577 Spears & Associates, Inc. / Oilfield Logix Series 2013 2, 660 1, 792 2014 2, 330 2, 108 2015 984 1, 426 2016 766 1, 296 64

Spears & Associates: Wireline Market Northeast Cased hole wireline dominates the Northeast since plug & perf techniques are preferred on multiple stage frac jobs…and very little formation evaluation is required during the drilling phase. Wireline – Northeast $600 As shown in the neighboring chart, the region’s wireline market is ~$. 3 billion in 2015. This is down 43% from 2014. Allied Horizontal Wireline C&J/Cased Hole Solutions JW Wireline (FTS) Superior Renegade Halliburton Schlumberger Weatherford $ in Millions A few notable companies operating in the area include: $500 $400 $300 $200 $100 $0 OH CH 2012 $72 $348 2013 $65 $400 Spears & Associates, Inc. / Oilfield Logix Series 2014 $46 $489 2015 $24 $280 2016 $13 $214 65

Spears & Associates: Wireline Market Northeast: Frac Stages / Well Frac stages is one of the metrics regularly quoted by analysts working in this industry. Except for those companies providing plug & perf technologies, this is not a very meaningful statistic. In the Northeast, as many as 40 frac stages have been pumped in a single well. As the table to the right shows, number of stages pumped have been increasing since 2012. Year of Completion Average Number of Frac Stages per well 2012 10 2013 12 2014 15 Distribution of Number of Frac Stages per Well 25 Wells in Sample 20 15 10 5 0 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 32 34 36 38 40 Number of Frac Stages Spears & Associates, Inc. / Field Logix Series 66

Spears & Associates: Wireline Market Northeast: Lateral Length Lateral length of horizontal wells has been getting longer each year, but length in 2013 and 2014 is showing a big jump as more 8 -10, 000’ laterals are appearing. The chart below plots the distribution of completed lengths of about 100 horizontal wells drilled in the last several years. The longest lateral in each year is 9, 000 -10, 000’, but the average or most frequently drilled lateral is still ~5, 000’. Year Average Completed Length of HW 2012 5, 200’ 2013 6, 000’ 2014 6, 500’ Distribution of Horizontal Lateral Lengths 9 8 6 5 4 3 2 1 0 00 00 0, 1 , 5 00 9 , 0 00 9 , 5 00 8 , 0 00 8 , 5 00 7 , 0 00 7 , 5 00 6 , 0 00 6 , 5 00 5 , 0 00 5 , 5 00 4 , 0 00 4 , 5 00 3 , 0 00 3 , 5 00 2 , 0 00 2 , 5 00 1 1 , 0 00 0 5 Wells in Sample 7 Lateral Length (ft. ) Spears & Associates, Inc. / Oilfield Logix Series 67

Spears & Associates: Wireline Market Western: Description California’s oilfields have been actively drilled and produced for decades. The heart of the industry surrounds Bakersfield, with clusters of activity near Los Angeles and the Elk Hills region. Further north in the state lies an active geothermal play. This report does not address that market. New Well Drilling 3, 000 2, 500 Vertical 2, 000 Horizontal 1, 500 1, 000 500 0 Vertical Horizontal 2012 1, 950 544 2013 1, 519 637 2014 1, 993 731 2015 1, 013 431 2016 788 386 68

Spears & Associates: Wireline Market Western The western US continues to be one of the smaller market regions. Most of the activity here will be concentrated in the old Long Beach and Bakersfield area oil fields. Wireline – Western $300 As shown in the neighboring chart, the region’s wireline market is ~$. 3 billion in 2014. This is up 50% from 2011. Tiger Wireline (C&J Wireline) Halliburton Schlumberger Weatherford $ in Millions A few notable companies operating in the area include: $250 $200 $150 $100 $50 $0 OH CH 2012 $35 $176 2013 $28 $209 Spears & Associates, Inc. / Oilfield Logix Series 2014 $27 $251 2015 $7 $104 2016 $4 $79 69

Spears & Associates: Wireline Market Western: Lateral Length Lateral length of horizontal wells has been getting longer each year, but California has the nation’s shortest horizontal wellbores (average length). Average completed length was 1, 200’ in 2014, up significantly from 2011, but most wells tend to be less than 1, 000’ long. Year Average Completed Length of HW 2012 1, 000’ 2013 1, 100’ 2014 1, 200’ Distribution of Horizontal Lateral Lengths 12 8 6 4 2 00 16 00 20 00 24 00 28 00 32 00 36 00 40 00 44 00 48 00 52 00 56 00 60 00 64 00 68 00 72 00 76 00 80 00 0 12 80 0 0 40 Wells in Sample 10 Lateral Length (ft. ) Spears & Associates, Inc. / Oilfield Logix Series 70

Spears & Associates: Wireline Market Western: Frac Stages / Well With relatively short horizontal laterals and with wellbore configurations that tend to be vertical, the number of frac stages per well tends to be lower than most other regions. The graph below shows that most wells have 14 frac stages. Longer laterals should promote more growth in this area, but with such a large decline in drilling activity, it could take several years for this growth to occur. Distribution of Frac Stages per Well 35 Wells in Sample 30 25 20 15 10 5 0 1 2 3 4 5 6 7 8 9 10 11 12 13 Number of Frac Stages 14 15 16 17 18 19 20 71

Spears & Associates: Wireline Market Gulf Coast/Southeast: Description This region includes South Louisiana and the coast eastward to Florida. New Well Drilling 2, 500 2, 000 Vertical Horizontal 1, 500 1, 000 500 0 Vertical Horizontal 2012 1, 130 838 2013 942 1, 036 2014 912 1, 226 2015 554 907 2016 318 682 72

Spears & Associates: Wireline Market Gulf Coast/Southeast As shown in the neighboring chart, the region’s wireline market is ~$. 4 billion in 2014. This is up from ~$. 25 billion in 2011. Wireline – Gulf Coast/Southeast $450 A few notable companies operating in the area include: $350 $ in Millions Pioneer GE Superior Energy Services Moncla Archer Ark. La. Tex Halliburton Schlumberger Weatherford $400 $300 $250 $200 $150 $100 $50 $0 OH CH 2011 $79 $155 2012 $98 $218 Spears & Associates, Inc. / Oilfield Logix Series 2013 $83 $273 2014 $84 $339 2015 $42 $207 2016 $22 $156 73

Spears & Associates: Wireline Market Wireline: Supply Chain 74

Spears & Associates: Wireline Market Wireline Supply Chain • There are five major components to the Wireline Supply Chain – Wireline Cable • A consumable downhole product used by wireline companies to deploy and retrieve tools in a wellbore. The cable is constructed such that two layers of helically wound steel (typically) wires surround one or more insulated conductors (nominally copper). The conductor carries the electrical power and communication signals to and from the downhole tools while the outer steel layers provide protection to the conductor(s) and the mechanical strength necessary to deploy the tools in and out of the wellbore. – Wireline Units (Trucks and Skids) – Downhole Wireline Tools • • CH OH – Wireline Data Acquisition Systems – Perforating Supplies • Related/Support Products & Services – Pressure Control Equipment and Rental 75

Spears & Associates: Wireline Market Wireline as a Consumable • • • The wireline is an essential part of the wireline operation. Open Hole units typically have one cable installed on the winch while a cased hole unit may have one or two cables. Each wireline unit in operation must have at least one serviceable cable installed and in a condition acceptable to running in and out of the wellbore. The action of running the cable in and out of the well produces wear and tear on the cable. – – • • Historically, a CH cable may last 12 – 18 months dependent on conditions, care and frequency of use. Open hole cables, under normal conditions, with proper care and maintenance may last 18 – 30 months. Currently, CH cables used in pump-down operations have a shortened life of 6 – 10 months due to much higher utilization rates, service intensity and the wear and tear imposed by the pump-down process. More extreme well environments also contribute to shorter life The end of the wireline connected to the downhole tools experiences the most wear and is subsequently cut off and discarded on a frequent basis. Thus, a wireline gets progressively shorter during its life and is eventually retired from use when it is too short for regional conditions or other damage and wear factors render the cable unusable. Cables can be repaired and or spliced to “rescue” a cable damaged during use. Local conditions and practices determine the extent to which repairs are acceptable. 76

Spears & Associates: Wireline Market Wireline Cable Typical Configuration Insulation • Material used largely defines maximum temperature rating from 300 to 600 ℉ Conductor (nominally copper) • Single conductor for CH cable • 7 conductors for OH cable Outer Armor Inner Armor • Wireline cable is manufactured to create one piece cables in typical lengths from 20, 000’ to 30, 000’ • Diameters range from. 185” to . 425” for CH work (single conductor) and . 325” to. 522” for OH (multi conductor) cables • Breaking strength varies from 1, 000 lbs to > 30, 000 lbs and is largely determined by the cables’ outside diameter. Outer Armor Inner Armor Insulation Conductor Cable Cross Section View 77

Spears & Associates: Wireline Market Wireline as a Consumable Factors determining the life-span of a wireline: • Wellbore conditions – Corrosive fluids can damage and weaken the steel armor. Special cable metallurgy can combat this increased wear. Conveyance type – Wireline cable was designed to be under tension during operation. Pump-down or other conveyance methods which place the cable under compression place additional wear and tear on the cable Maintenance – Cables that receive periodic maintenance are proven to have longer life spans Installation – Proper installation of new cables onto the drum is essential to providing expected cable life spans – – • Wireline Pricing: – – A standard CH cable averages ~ $1. 00 per linear foot of cable A standard OH cable averages ~$2. 00 per foot A standard Mechanical Cable averages ~ $. 50 per foot Corrosive resistant cables can cost > $10. 00 per foot 78

Spears & Associates: Wireline Market Wireline Cable Suppliers • Wire. Co World. Group (Camesa Brand) – – • Deacero – • Sugarland, TX Quality Wireline & Cable (Forum Energy Technologies) – – – • Burleson, TX Vector (Schlumberger) – • Virginia Manuf Synergy Wire & Cable – • Houston & Mexico Rochester Corp. (TE Connectivity) – • Queretaro, Mexico Deep Well Technologies – • Mexico City, Mexico Previously also marketed the “Wireline Works” brand but has been merged into Camesa during 2015 Calgary, CA CH & OH 33% market share China & Russia (unable to sell to NAM and/or International service companies due to quality issues) 79

Spears & Associates: Wireline Market Wireline Distribution • • Wirelines in North America are sold through distributor networks. The distributors are typically small, privately held regional companies. Distributors maintain on hand stock of various wirelines to be readily available. Distributors normally sell the wireline and receive a commission from the cable manufacturer. Distributors provide necessary aftermarket services: – Installation of new wirelines – Repair services – Maintenance services • • • Cleaning Cable Lubrication Cable Tightening and Tensioning 80

Spears & Associates: Wireline Market Global Wireline Cable Global Wireline (Cable) Market Wirelines – 2015 Global Market by Type $88 million 180 160 14% Intnl CH NAM CH Intnl OH 27% NAM OH 28% $ in Millions 31% 120 100 80 60 40 2011 2012 2013 2014 2015 81

Spears & Associates: Wireline Market Wireline Cable CH Wirelines – 2015 NAM Estimated Market $25 million 8% Wire. Co 12% 32% 22% Quality Schlumberger Rochester Deacero 24% OH Wirelines – 2015 Global Estimated Market $36 million Other 56% Wire. Co 22% 24% 82

Spears & Associates: Wireline Market Perforating 83

Spears & Associates: Wireline Market Perforating Market The 2014 $260 million perforating charge market represents approximately 37 million charges. If we include charges produced and utilized in China & Russia there approximately 64 million charges sold in 2014. Spears estimated that two-thirds of the global demand could be found in North America. This is due to the type of drilling and completion work found in the US and Canada. Other parts of the world will use fewer perforating shots due to generally higher quality reservoirs being developed. $1, 200 $1, 000 $ in millions The perforating market, addressable from the US*, grows and shrinks along with the wireline market. Extra growth has been added by the increased cased hole service intensity required by the horizontal unconventional reservoirs. Spears expects the switches segment to have a higher growth rate as the industry continues to adopt RF (radio frequency) safe, digitally addressable switches to further enhance safety, reliability and efficiency of perforating systems. $800 $600 $400 $200 $0 Other Detonators & Switches Charges & Det Cord Guns & Subs *Does not include the perforating charges and systems supplied from China and Russia together supply an estimated 27 million perforating charges annually in 2014. 2010 $20 $88 $175 $392 2011 $23 $125 $220 $495 2012 $25 $140 $235 $535 2013 $26 $155 $250 $565 2014 $28 $170 $260 $590 2015 $20 $135 $182 $353 2016 $18 $125 $165 $315

Spears & Associates: Wireline Market Perforating Market 2015 – Perforating Charges by Supplier - $182 million $1, 200 5% Titan 22% 5% Core Lab (Owens) $1, 000 SLB 5% JRC (HAL) 19% 16% ETA GEO DYNA 19% $ in millions 5% 3% $800 $600 $400 BH Other $200 $0 Titan and Owens supply the market with > 40% of the charges required. Both have extensive warehouses throughout the US and supply the majors as well as independent wireline companies. Other Detonators & Switches Charges & Det Cord Guns & Subs 2010 $20 $88 $175 $392 2011 $23 $125 $220 $495 2012 $25 $140 $235 $535 2013 $26 $155 $250 $565 2014 $28 $170 $260 $590 2015 $20 $135 $182 $353 2016 $18 $125 $165 $315

Spears & Associates: Wireline Market Perforating Suppliers Majors Independents Supplier Est. 2015 Global Revenue (Perf Sys) Description Market Regions Titan Manufacturer and supplier of perforating & logging products and supplies No. Am, So. Am, Eur, ME, Far East ~$185 M Core Labs (Owen) Manufactures and distributes perforating products and supplies No. Am, So. Am, Eur, ME, Far East ~$175 M Geo Dynamics Manufactures and distributes perforating and related supplies No. Am, Eur, ME, Far East ~$50 M DYNA Energetics Manufactures and distributes perforating systems and supplies No. Am, Eur, ME, Far East ~$75 M ETA S. A. Argentine based supplier of perforating charges, guns and supplies No. Am, So. Am, Eur ~$80 SWM Manufacturer/distributor of perforating guns No. Am, So. Am, Eur, ME, Far East ~$10 M Probe Technologies Designs, manufactures and distributes full range of perforating tools and equipment No. Am, So. Am, Eur, ME, Far East ~$70 M G&H Manufactures and distributes perforating guns No. Am, So. Am, Eur, ME, Far East ~$8 M SLB Integrated service provider with in-house perforating hardware manufacturing Global ~$170 M JRC (HAL) Integrated service provider with in-house perforating hardware manufacturing Global ~$125 Baker Hughes Integrated service provider with in-house perforating hardware manufacturing Global ~$115

Spears & Associates: Wireline Market Data Acquisition Systems 87

Spears & Associates: Wireline Market Data Acquisition Systems There is only one story to tell regarding the data acquisition systems available and that is of Scientific Data Systems. SDS developed a PC based cased hole logging system in 1993 and it has evolved into the de facto standard in logging systems available to the independent wireline company around the world. The Warrior Well Logging System (as marketed by SDS) has both open hole and cased hole capabilities and is compatible with virtually all types of downhole tools available from the various tool suppliers. Schlumberger, Baker, Halliburton and Weatherford utilize proprietary systems but Warrior systems will be found within all these majors. The data system acts as the “brains” of a logging unit and consists of both hardware and software. In the Warrior System, most of the value resides in the software. 2015 – 3 rd Party Data Acquisition System Estimated Market Size - $9 million 88

Spears & Associates: Wireline Market Pressure Control Equipment 89

Spears & Associates: Wireline Market Pressure Control Equipment is utilized during a wireline operation. The equipment allows the wireline to move in and out of the well while maintaining a pressure seal at the well head. Quite often, cased hole wireline operations are performed with pressure present at the well head so that well productivity is not damaged or otherwise compromised. The carton to the right and more detailed drawing on the far right show typical well head wireline PCE gear. 90

Spears & Associates: Wireline Market Wireline PCE Market Spears estimates half of the rental PCE market is provided by wireline companies, while the remainder is provided by 3 rd party companies. 2015 New Wells Market Size (millions) $/New Well 28, 200 $130 $5, 000 300 $14 $45, 000 Intl Land 9, 300 $120 $13, 000 Intl Offshore 2, 600 $170 $65, 000 TOTAL 40, 400 $434 $11, 000 No. Am Land No. Am Offshore 2014 Regional New Well Distribution Some 10 k PCE packages and almost all 15 k packages are supplied by 3 rd party suppliers 2014 Regional Revenue Distribution 6% 23% No. Am Land No. Am Offshore 30% No. Am Land 39% No. Am Offshore Intl Land Intl Offshore 1% 3% Intl Offshore 70% 28% Source: Spears & Associates 91

Spears & Associates: Wireline Market Based on Spears’ research and estimates, the global wireline PCE market will be $434 million in 2015, a sharp decline from 2014 as both activity and pricing was reduced. Growth in 2016 will be difficult as drilling activity and, therefore, completion activity, decline in the US. The largest market is International Offshore comprising 39% of the total market. Offshore (international plus North America) represents ~42% of the wireline PCE market. Millions Wireline PCE Market $900 $800 $700 $600 $500 $400 $300 $200 $100 $0 International Offshore International Land No. Am Offshore No. Am Land 2010 2011 2012 2013 2014 2015 Millions Region 2010 2011 2012 2013 2014 2015 No. Am Land $260 $350 $375 $400 $130 No. Am Offshore $20 $25 $30 $14 International Land $140 $135 $145 $150 $160 $120 International Offshore $125 $130 $160 $180 $200 $170 TOTAL $545 $635 $705 $735 $790 $434 Source: Spears & Associates’ DPO September 2014, plus Spears’ research. 92

Spears & Associates: Wireline Market Wireline Pressure Control Supplier Matrix Supplier NOV Elmar PCE Equipment Sales ✔ STS (Oil States) Hunting PCE Rental ✔ ✔ Professional Wireline (Halliburton) ✔ Forum Energy Technologies ✔ Frank Henry ✔ Gulfstream Services ✔ Supreme Services ✔ MPSI (Manufactured Products & Supply) ✔ Yellow Jacket ✔ Pressure Control Specialties ✔ Quinn’s Market Leaders ✔ NXT Oilfield Rentals ✔ ✔ Estimated 2015 Market $. 7 billion Estimated 2015 Market $. 6 billion 93

Spears & Associates: Wireline Market High Pressure Wireline Equipment Rental Wireline service providers historically have provided much of the low pressure (< 5, 000 psi at well-head) pressure control equipment (PCE) required during a wireline job. Most land offshore wireline companies choose to own and utilize this “low Pressure” PCE as a matter of convenience and economics. A set of 5 k PCE gear can be purchased for $75 k and will generally achieve payback in a matter of months. Third party suppliers, are relied upon to provide the specialized equipment and personnel required on a high pressure (15 k psi at well head). The mid-pressure (10 k psi at well head) is a mixed market with some wireline companies providing the equipment and others relying on third party providers. A typical wireline pressure control kit includes: wireline BOP, Pack-Off, Grease Injector Pump and Hoses, Grease Head and Flow Tubes, Lubricator, Tool Trap and/or Head Catcher. Kits are supplied to match pressure requirements but typical working pressures are 5, 000 psi, 10, 000 psi or 15, 000 psi. Why do wireline providers choose third party PCE for high pressure jobs? High pressure gear is considerably more expensive. A set of 15 k gear can cost in excess of $250 k. Lower utilization rates of this class of equipment precludes ownership and maintenance. High pressure gear requires constant maintenance and certification. This required activity detracts from the wireline company’s focus of service performance at the wellsite. Safety on a high pressure job is at a premium. The risks increase substantially where high pressure exists at the wellhead. It is difficult for a wireline company with low utilization rates of high pressure PCE to provide a person whose full time task is PCE service operator. Provision of a PCE service operator with 100% focus and training on the high pressure task is the only appropriate response to this requirement. Recognizing the above, it is not unusual for the well operator to require third party provision of high pressure PCE gear and service. 94

Spears & Associates: Wireline Market Wireline Units 95

Spears & Associates: Wireline Market Units: M&A 01/12/14 - The Artex Group - National Oilwell Varco (NOV) acquired The Artex Group effective 12/8/14. With 120+ employees and activities in (Brenham, TX) US, Middle East & South America, Artex fabricates wireline trucks for, and provides downhole tools & surface products and truck refurbishment services to, wireline services companies serving the oil & gas industry. 96

Spears & Associates: Wireline Market Wireline Units Supplier Matrix CAPEX spending was non-existent or highly constrained throughout 2015 placing large downward pressure on the unit supply market. A few new start-up wireline companies in the US added about 40 new-build units. Supplier Description Est. Annual Unit Sales NOV Elmar (ASEP) Manufactures e-line and slickline trucks and skids on a global basis ~$15 M Texas Wireline Manufactures and refurbs trucks and offshore skids ~$5 M Synergy Manufactures and refurbs trucks Artex (Acquired by NOV, December, 2014) Manufactures and refurbs e-line and slickline trucks and skids. ~$5 M General Bodies (Canada) Manufactures and refurbs e-line and slickline trucks and skids. ~$2. 5 M Dyna Winch (Canada) Manufactures and refurbs e-line and slickline trucks and skids. Has sold on a global basis ~$7 M Wireline Truck Fab Manufactures and refurbs trucks and offshore skids ~$2 M Eclipse Wireline Manufactures e-line and slickline trucks and skids. Has sold on a global basis ~$6 M Turnkey Industries Manufactures e-line trucks and data vans for frac ~$2 M Others ~$5 M ~$25 M Estimated 2015 Market $75 million 97

Spears & Associates: Wireline Market Downhole Wireline Tools 98

Spears & Associates: Wireline Market Wireline Tool Supplier Matrix Independents Supplier E-line OH E-line CH SL ✔ ✔ ✔ Titan (Hunting) Manufactures and distributes full range of cased hole e-line and slickline tools and equipment Probe Technologies Manufactures and distributes full range of open hole, cased hole e-line and slickline tools and equipment ✔ ✔ Hotwell Manufactures and distributes full range of cased hole e-line tools and equipment. Distributes Chinese made open hole tools. ✔ ✔ GE Oil & Gas In-house R&D, Engineering, Manufacturing and sales of full range of open hole, cased hole e-line and slickline tools and equipment ✔ ✔ NOV Elmar Logan Majors Description Manufactures and distributes slickline tools and equipment ✔ ✔ Manufactures and distributes slickline tools and equipment ✔ GOWELL (China) Manufactures and distributes full range of open hole, cased hole e-line tools and equipment SLB Integrated service provider with in-house R&D, Engineering and Manufacturing of proprietary tools for internal use. Has sold older generation tools to National Oil Companies ✔ ✔ HAL Integrated service provider with in-house R&D, Engineering and Manufacturing of proprietary tools for internal use. ✔ ✔ Weatherford Integrated service provider with in-house R&D, Engineering and Manufacturing of proprietary tools for internal use. ✔ ✔ Baker Hughes Integrated service provider with in-house R&D, Engineering and Manufacturing of proprietary tools for internal use. Has sold older generation tools to National Oil Companies ✔ ✔ Estimated 2015 Market $100 million (Excluding Majors) 99

Spears & Associates: Wireline Market Drivers 100

Spears & Associates: Wireline Market Price & Drilling Forecasts $100 80, 000 $5 70, 000 $90 60, 000 $4 50, 000 $70 $60 $3 $50 $40 $2 $30 $20 $1 Wells Drilled 40, 000 Natural Gas Spot West Texas Intermediate Oil $80 30, 000 20, 000 10, 000 0 Intl Total Wells Canada Total Wells US Total Wells 2012 13, 550 10, 900 46, 700 2013 13, 300 10, 900 45, 300 2014 13, 700 11, 300 45, 800 2015 12, 250 5, 500 22, 800 $10 $0 Oil Price Gas Price 2012 $94. 18 $2. 71 2013 $98. 12 $3. 65 2014 $93. 92 $4. 33 2015 $50. 77 $2. 76 2016 $57. 75 $3. 25 $0 Source: Spears & Associates’ DPO September 2015 101 20 11, 5, 4 19,

Spears & Associates: Wireline Market US Horizontal & Vertical New Wells 50, 000 45, 000 40, 000 35, 000 Wells Drilled 30, 000 25, 000 20, 000 15, 000 10, 000 5, 000 0 Vertical Horizontal/Directional 2012 28, 300 18, 300 2013 25, 100 20, 300 2014 21, 800 2, 400 Source: Spears & Associates’ DPO September 2015 8, 800 14, 000 2016 7, 400 12, 600 102

Spears & Associates: Wireline Market Offshore New Wells 3, 500 3, 000 Wells Drilled 2, 500 2, 000 1, 500 1, 000 500 0 Intl Offshore US GOM 2012 2, 469 384 2013 2, 544 455 2014 2, 615 462 Source: Spears & Associates’ DPO September 2015 2, 352 315 2016 2, 203 345 103

Spears & Associates: Wireline Market US Drivers: Rig Efficiency Horizontal well rig efficiency has increased 33% over the same period. This is ~7% CAGR in efficiency for the period The increased Horizontal well rig efficiency is a direct driver of increased cased hole wireline services in all regions. It also appears that growth in horizontal rig efficiency has slowed or stopped in the near term. 70 US New Well Drilling: Wells / Rig 60 50 Wells/Rig Annually The exciting story in US drilling, and particularly on land, is rig efficiency. As seen in the adjacent chart, vertical well rig efficiency has increased 31% for a CAGR of 7% from 2011 to 2015. Although the efficiency has improved, both the vertical rig count and vertical wells drilled are declining. 40 Vertical 30 Horizontal 20 10 0 Vertical Horizontal 2011 48 12 2012 51 13 2013 58 15 Source: Spears & Associates’ DPO September 2015 2014 58 16 2015 63 16 2016 65 16 104

Spears & Associates: Wireline Market Offshore New Wells in the US While the U. S. land continues to drive much of the drilling activity, offshore activity climbed from it’s low point in 2010 of approximately 500 new wells in 2014 before falling again in 2015. US Offshore 600 New Wells Drilled 500 400 300 200 100 TOTAL WEST GOM 2010 278 22 256 2011 284 23 261 2012 417 33 384 2013 494 39 455 Source: Spears & Associates’ DPO September 2015 2014 502 40 462 2015 342 27 315 2016 375 30 345 105

Spears & Associates: Wireline Market Horizontal & Vertical New Wells in the US Since 2009, drilling in the US has fundamentally changed. Prior to 2009, oil and gas producers drilled vertical wells and only drilled horizontal wells offshore and in a handful of natural gas shale plays. The slow down of 2009 gave producers free time to evaluate their drilling opportunities and most concluded that their future would consist of drilling horizontal wells in all types of oil-bearing rock. Vertical drilling has been in decline and horizontal drilling has grown. Although vertical wells will always be in the portfolio of drilling techniques, horizontal is now broadly adopted and embraced by all types of exploration and production companies in North America. This shift in drilling has led to a decline in open hole logging, onshore in the US. Many vertical wells obtain open hole logs while virtually all horizontal wells in the unconventional basins do not. 2009 US Well Drilled By Type 2015 Well Drilled By Type 21% 39% Vertical Horizontal 79% 61% Source: Spears & Associates’ DPO September 2015 Vertical Horizontal 106

Spears & Associates: Wireline Market Companies 107

Spears & Associates: Wireline Market Companies: M&A News FORT WORTH, Texas, Dec. 8, 2014 – FTS International (FTSI), the largest independent well completion service company in North America, announced today that it has completed the acquisition of substantially all the assets of J-W Wireline Company (J-W Wireline). The close of this acquisition increases FTSI’s wireline capacity more than tenfold and extends wireline service to all locations where the company currently offers hydraulic fracturing services, including the Permian Basin; Eagle Ford, Marcellus, Utica and Haynesville shales; and various mid-continent plays. The acquisition of substantially all of the assets of J-W Wireline, one of the largest independent cased-hole wireline companies in North America, provides a national wireline footprint to FTSI’s North American well stimulation fleet, which has more than 1. 6 million hydraulic horsepower. FTSI and J-W Wireline customers can now benefit from a more comprehensive and efficient bundle of well completion services, including vertical and horizontal (pump down) perforating, comprehensive cased-hole logging services including cement bond logs and production logging, slickline, braided line, tubing conveyed perforating (TCP), pipe recovery and mechanical services. “This acquisition provides us several key opportunities, ” FTSI Chief Executive Officer Greg Lanham said. “Partnering the acquired wireline units with our existing stimulation fleets will allow us to reduce wireline-related downtime for our customers while increasing the utilization of our equipment. ” The acquisition includes approximately 70 active wireline units, related district operation locations, a manufacturing facility and a training facility. With the completion of the transaction, approximately 400 J-W Wireline employees are joining FTSI, including a wireline management team with deep industry experience. Mr. Lanham added, “This acquisition places us even more securely among the top well completion service companies in North America as we continue to add scope and scale to the services we provide our customers. ” 108

Spears & Associates: Wireline Market Allied Horizontal Wireline Services Allied Horizontal Wireline, a privately held company, placed together two complementary companies, Allied Wireline and Horizontal Wireline in early 2014. AHWS is one of few independent wireline provides to supply both open hole and cased hole services to the US market in the major producing basins. 109

Spears & Associates: Wireline Market Archer, publicly traded in Norway, has grown through acquisition, including buying Gray Wireline in December of 2010, which added Cased hole wireline services in the US. Gray brought 110 wireline trucks and 6 offshore skids to Archer serving most of the U. S. market. Archer subsequently augmented its U. S. wireline offering with the acquisition of Universal Wireline in January of 2011. Universal added an additional 26 wireline trucks in capacity. 110

Spears & Associates: Wireline Market Baker Hughes’ wireline operation represented ~7% of the company’s 2015 total revenues. BHI has wireline operations around the world, both land offshore, and holds the number 3 position in North America. 111

Spears & Associates: Wireline Market Basic Energy Services Wireline remains a relatively small , ~1% of revenue, part of Basic’s operation. Basic provides cased hole services from locations in the Eastern Permian Basin. 112

Spears & Associates: Wireline Market C&J Energy Services Cased Hole Solutions was acquired June of 2012 adding substantially to C&J’s wireline capabilities and presence. C&J expanded into the Los Angeles and San Joaquin Basins of California with the acquisition of Tiger Cased Hole Services in May of 2014. Tiger provides land offshore (West Coast U. S. ) cased hole services as well as geothermal logging. During June of 2014, Nabors agreed to combine its Completion and Production Services with C&J Energy Services. This will include Nabors ~42 wireline cased hole units. The deal closed Q 1 2015. 113

Spears & Associates: Wireline Market China Oilfield Services COSL offers both open hole and cased hole wireline services and product sales as part of their offering. 114

Spears & Associates: Wireline Market Expro International Expro provides e-line and slickline cased hole well intervention and perforation services on a global basis 115

Spears & Associates: Wireline Market Spears & Associates: Hydraulic Fracturing Market FMC Technologies FMC acquired Pure Energy Services October, 2012 adding cased hole wireline in North America (largely in Canada). 116

Spears & Associates: Wireline Market Spears & Associates: Hydraulic Fracturing Market FTS International FTS acquired J-W Wireline in Q 4 of 2014 to give FTS cased hole wireline capabilities in the US to compliment its fracturing service. 117

Spears & Associates: Wireline Market Spears & Associates: Hydraulic Fracturing Market Forum Energy Technologies Annual Product Line Sales $80 $60 Millions FET is a manufacturer of engineered products for the oilfield. The high pressure treating iron segment serves the wireline market. We have estimated sales of these this product line in the neighboring graph. Treating Iron $40 $20 $0 2015 2014 2013 2012 2011 2010 2009 2008 118

Spears & Associates: Wireline Market Spears & Associates: Hydraulic Fracturing Market GE Oil & Gas provides open hole and cased hole wireline downhole tools and equipment on a global basis. GE also runs a cased hole service business, obtained in an acquisition from The Wood Group, in the US land, GOM , Argentina and Venezuela markets. 119

Spears & Associates: Wireline Market Spears & Associates: Hydraulic Fracturing Market Halliburton HAL is the second largest oilfield service company with open hole and cased hole wireline service locations around the world. Halliburton’s wireline is a distant second in the global market behind Schlumberger. Halliburton has announced a merger with rival Baker Hughes which may complete in early 2016. 120

Spears & Associates: Wireline Market Spears & Associates: Hydraulic Fracturing Market Hunting Energy Services Through its Titan division, Hunting is a major supplier of downhole wireline tools, perforating equipment and perforating shaped charges. 121

Spears & Associates: Wireline Market Spears & Associates: Hydraulic Fracturing Market National Oilwell Varco NOV is a global giant in supplying the energy and energy services industries. Through the NOV Elmar division, they manufacture and sell wireline pressure control equipment and wireline units. 122

Spears & Associates: Wireline Market Spears & Associates: Hydraulic Fracturing Market Pioneer operates a fleet of 120 units mainly in the Bakken, Eagleford and Permian basins. Pioneer offers both open hole and cased hole services. Pioneer Wireline grew by acquisition and the legacy companies include: Pioneer Wireline (Texas), Penkota Wireline (North Dakota), Competition Wireline (Montana, Wyoming) Log-Tech (Kansas, Oklahoma, Colorado), Rocky Mountain (Colorado) and Phoenix Surveys (Utah, Wyoming). 123

Spears & Associates: Wireline Market Spears & Associates: Hydraulic Fracturing Market Renegade is a good example of a large, regionally diverse cased hole independent in the US with locations in most producing basins on land. 124

Spears & Associates: Wireline Market Spears & Associates: Hydraulic Fracturing Market Schlumberger The world’s largest oilfield service company is the second largest frac and cement company. Schlumberger “wrote the book” on wireline logging and are the undisputed leader in this service and technology around the globe. In North America, Schlumberger’s wireline dominance is put under pressure from the independent cased hole companies. 125

Spears & Associates: Wireline Market Spears & Associates: Hydraulic Fracturing Market Superior Energy Services SPN acquired Black Warrior Wireline December, 2010. 126

Spears & Associates: Wireline Market Spears & Associates: Hydraulic Fracturing Market Weatherford is a distant # 4 among the major energy service companies in wireline. 127

Spears & Associates: Wireline Market Authors 128

Spears & Associates: Wireline Market Authors Spears & Associates has specialized in evaluating oilfield equipment and service markets and companies worldwide since 1965. The firm has completed ~2400 custom oilfield market research projects around the world and worked for ~400 clients in 2014. The firm is headquartered in Tulsa and has consultants across the US. Contributors to this report include: John Spears President Drilling & Production Outlook OILFIELD LOGIX, launched in 2012, is a standardized database of well construction and completion records across all active land basins in the US. The database spans the years 2010 through current, with thousands of wells added each year. OILFIELD LOGIX’S team of 15 data analysts uses a variety of public and private sources to construct a searchable database of new well construction and completion information. OILFIELD LOGIX is an independent data manufacturing company that works in cooperation with Spears & Associates to bring field level market intelligence and market analysis to the upstream oil and gas industry. Richard Spears Vice President Oilfield Market Report For additional information, please visit: Lauren Collette Data Analyst www. oilfieldlogix. com Spears & Associates sales & marketing: Katie Bewley Director, Client Relations Independent Advisor to Spears & Associates: David Otte Ft Worth, Texas 129

Spears & Associates: Wireline Market Legal Matters Copyright 2015, Spears and Associates, Inc. All rights reserved. This communication is confidential and is provided to clients of Spears and Associates, Inc. for their lawful use. This communication may not be disclosed, copied or disseminated, in whole or in part, without the prior written permission of Spears and Associates, Inc. The report and its contents are the property of Spears and Associates Inc. and are protected by applicable copyright, trade secret or other intellectual property laws. Disclaimer: This communication is based on information that Spears and Associates, Inc. believes is reliable. However, Spears and Associates, Inc. does not represent or warrant its accuracy, completeness, or any other aspect of this information. The viewpoints and opinions expressed in this report represent the views of Spears and Associates, Inc. as of the date of this report. These viewpoints and opinions may be subject to change without notice. This message should not be considered as a recommendation to buy or sell any securities. In no event shall Spears and Associates, Inc. be liable for incidental or consequential damages associated with reliance on any statement or opinion contained in this report. Important Disclosures: The following analysts were involved in creating or supervising the content of this report: Richard Spears, John Spears, and Lauren Collette. These analysts certify that the views and opinions expressed in this report accurately reflect their personal views. These analysts have not and will not receive direct or indirect compensation in return for expressing specific viewpoints in this report. Spears and Associates, Inc. provides market research services to the petroleum industry, but does not provide investment banking services. From time to time Spears and Associates, Inc. will provide market research consulting services to some of the oilfield service companies mentioned in this report for which the firm is compensated. 130