~ Contact - Name~

~ Contact - Title~

~ Opportunity Account~

~ Account - Address1~
~ Account - Address2~

~ Account - City~, ~ Account – State~ ~ Account - Postal Code~	07/25/2012

Subject: Proposal XXX- ~=qdb.format(record.selectSingleNode("f[@id=/*/table/fields/field[label='Date Created']/@id]").text,"date friendly")~

Dear ~ Contact - First Name~,

Thank you again for the opportunity to provide microseismic services to ~Opportunity Account~. As requested, the attached proposal is our estimate for a microseismic fracture mapping program at the ~ Well ID~ H well in Start Date. Based on our discussions, this will be a surface acquisition project covering a ~ Well ID~ horizontal well at an approximate depth of ~ Well Depth~ using three-component surface microseismic. The survey will provide microseismic data for a ` Well Depth`~Frac Stages~ stage hydraulic fracture over 8 days.

Spectraseis offers the industry’s most advanced technologies and services for microseismic data acquisition, processing and imaging. Our high-sensitivity, broadband instruments for surface acquisition and our application of full elastic wave equation imaging offer ~Opportunity Account~ the unique advantage of high-confidence data, which is not available from any other provider.

Spectraseis also offers Ambient Wave-field Characterization (AWC) to map attributes associated with changes in the reservoir fluid system due to hydraulic fracture stimulation, and borehole acquisition microseismic services. We would be happy to discuss these additional services with you as we are confident that they would add value to the overall project scope.

This proposal is valid until ~ ~=qdb.format(record.selectSingleNode("f[@id=/*/table/fields/field[label='Date Created']/@id]").text,"date friendly")~. We are very much looking forward to working with you on this important pilot project.

Yours sincerely,

~ Account Owner~

~ Account Owner - Title~

Fracture Imaging and Microseismic Analysis Proposal

~Opportunity Account~

~ Project County/Parish~ County, ~ Project State/Province~

Contents

I.	Context and ~Opportunity Account~’s objectives	4

II.	Scope of work	4

1. Solution overview	4

2. Surface data acquisition	5

3. Data Processing	5

4. Requirements	6

5. Deliverables	7

III.	Commercial Terms	8

Fracture Imaging and Microseismic Analysis	8

Pre-survey design and modeling	8

Processing	8

Extra services and deliverables	8

For above quoted pilot well	8

Notes:	9

Payment Terms	9

Spectraseis Inc.	9

Customer Signature	9

Appendix A	10

Key components and benefits of Spectraseis’ technical solution	10

The most reliable and advanced microseismic solution

~+ Surface Sensor Count*3~-channels, three-component, broadband surface acquisition employs additional sensitivity to detect and locate microseismic events more accurately in the subsurface 3D space.

Three-component, full-waveform surface array acquisition records the complete elastic wavefield from the fracture of reservoir rocks.

Full-waveform, wave-equation imaging TRI (time-reverse imaging) yields not only event location, but also the orientation of the fracture with respect to the reservoir

Optional – ambient wavefield characterization (AWC) delivers unique attributes associated with changes in the reservoir fluid system from fracturing and production, providing the asset team with a new dataset for interpreting and evaluating the fracture networks created by the well stimulation.

Ultra high sensitivity
three-component broadband
microseismic sensor
and recording unit

Context and ~Opportunity Account~’s objectives

~Opportunity Account~ is seeking to monitor and improve fracture performance in the Utica Shale Formation. ~Opportunity Account~ would like to better understand the fracture network, and the effective stimulated reservoir volume (eSRV) resulting from hydraulic fracturing. This understanding is critical for improved reservoir characterization in order to optimize production.

The key elements of the program are:

Planned true vertical depth for this well is approximately 8,100 ft.

~Opportunity Account~’s frac program will have one horizontal well, ~Frac Stages~ frac stages, with the created fracture network expected to extend up to 1,000 ft from the well.

The horizontal leg of the well will be approximately 5,000 ft.

~Opportunity Account~ has identified the following objectives for acquiring broadband three-component microseismic data:

Image the fracture network created by a controlled frac program.

Evaluate surface microseismic data as an input in determining the effective stimulated reservoir volume (eSRV).

Scope of work

1. Solution overview

Spectraseis’ will accomplish ~Opportunity Account~’s objectives through a broadband, high-sensitivity surface microseismic data acquisition program and elastic wave-equation-based processing for one horizontal well.

Spectraseis will deploy up to ~= Surface Sensor Count*3~ seismic channels via ~ Surface Sensor Count~ ultra-sensitive, broadband, three-component sensor nodes in a 11x14 rectangular sensor grid at a 1400-ft regular spacing.

The final survey plan will be determined on award of the project, after discussions with the ~Opportunity Account~’s team regarding available subsurface data, velocity model information and the results of any pre-survey modeling.

This layout provides ~Opportunity Account~ with the seismic aperture to locate fracture events, sufficient sensor density to capture the three-component wave field for elastic imaging of the fracture events and to image changes in the reservoir fluid system.

Elastic imaging uses both P- and S-waves to provide the most robust and reliable fracture event location and characterization. Spectraseis also calculates a statistical confidence factor for each event to give the interpreter a quantitative basis for selecting sub-populations of fracture events for analysis. Spectraseis’ scope of work includes all planning and pre-survey modeling.

2. Surface data acquisition

Spectraseis field operations to acquire high-quality, broadband, three-component data are estimated to take ~Frac Days~ days on location, based on an expected eight days of fracturing operations on the well. The main field activities will be:

Lay out the recording array and begin continuous recording 24 hours prior to the start of the frac program (two days for layout plus one day recording; three days total)

Record the frac stimulation for approximately eight days (11 days total)

Two days of post frac recording (13 days total)

Two days to pick up recording equipment and demobilize crew (~Frac Days~ days total)

3. Data Processing

Spectraseis will provide the following:

Microseismic fracture imaging

Event table containing x,y,z,t for each event plus the confidence factor for each event

Fracture event images from 3D visualization application provided for all frac stages

Spectraseis will deliver frac stages to ~Opportunity Account~ as they are completed

Final fracture table will be delivered within 45 days of completing the last stage

Advanced fracture characterization

Spectraseis will provide SEGY volumes of images of fracture radiation patterns for selected fracture events from the event table.

This information will allow ~Opportunity Account~ to better understand how their fracture treatment impacted the reservoir through identifying the fracture orientation and movement on the chosen events.

Example – Microseismic events table (x, y, z, t) loads into workstations

Figure 2: Microseismic results will focus on imaging and characterizing fracture events.

4. Requirements

Spectraseis will require the following information prior to executing the survey.

3D elastic velocity model covering the area of the surface recording grid

Stacking velocities

Faults and horizons in time or in depth (for velocity model building)

If the above are not provided, at a minimum, the following is recommended:

P and S well log data on the vertical well or in the immediate area.

(We strongly recommend well log be run as close to the surface as possible.)

Check shot data

VSP data

Increased Perforation shot size at the horizontal well toe (21-23 grams/shot)

Location information for all wells, deviation surveys, formation tops and perforation intervals for wells in the survey area

Time series engineering data from the fracture stimulation program

It is important that there be open and timely discussions between ~Opportunity Account~ and Spectraseis technical staff throughout the data processing and analysis phase.

5. Deliverables

Pre survey plan and survey modelling report

Scouting report

Acquisition Report

Raw data

A SEG-P1 file, multiple standard SEG-Y format files along with metadata and a plain text file describing metadata for all measurements, including observer’s logs and weather data. The SEG-Y files will be of 1 minute duration each and will be delivered on USB hard drives.

OR

A SEG-P1 file, multiple Pascal SEG-Y format files (each file will have data for up to 24 hours each) along with metadata and a plain text file describing metadata for all measurements including observer’s logs and weather data, printable documentation about the Pascal SEG-Y format, and a README file. The SEG-Y files will comprise each frac stage recording.

Microseismic fracture imaging

Event table containing x,y,z,t for each event plus confidence factor for each event, in ASCII format (up to ~Frac Stages~ stages).

Fracture event images for selected events from 3D visualisation software for all frac stages (PowerPoint)

Advanced fracture characterisation:

SEG-Y volumes of images of fracture radiation patterns for selected fracture events (up to 10 events)

Acquisition and processing report (PDF format)

General

All support data required to process the SEGY data including survey information with detailed documentation of the location of each seismic receiver, and specifications of the sensors used.

Estimates for delivery times assume fracture pumping time of approximately 24 hours/day for 8 days with 2 stage/day hydraulically fractured. Delivery time is also dependent on ~Opportunity Account~ providing the velocity model/or velocity model inputs as discussed in joint technical meetings. Additional pumping time will affect delivery times, depending on the availability of computing capacity and consulting resources.

Spectraseis will keep ~Opportunity Account~ fully informed of deliverables timing and possible overruns throughout the program and seek to optimize the efficiency of the data processing phase to achieve ~Opportunity Account~’s objectives.

Commercial Terms

Fracture Imaging and Microseismic Analysis
Acquisition survey parameters	~Opportunity Account~
Survey days – total	~Frac Stages~
Surface sensors deployed	~ Surface Sensor Count~
Borehole arrays deployed	0
Wells	1
Arrays	1
Total channel count	~ +Surface Sensor Count*3~
Pre-survey design and modeling
Forward-model microseismic response	Included
Finalize survey layout	Included
Processing
Velocity model – build model or amend for microseismic analysis	Included up to 8 hours
Frac workflow – for up to 16 stages	Included
Event catalog (location, time, S/N amplitude)	Included
Moment tensor (fracture propagation and orientation for up to 10 events)	Included
Total Investment:	$298,000
Extra services and deliverables	For above quoted pilot well
Near Real-Time Option	Cost prohibited and not offered for the given terrain conditions
Data Storage	6 months included with delivery of job - $1,000 per month afterwards
Post Job Consulting	10 hours included with job - $650 per hour afterwards
Analysis and Velocity Modeling – Additional work outside the scope of this proposal	$650 / hour – Principal Geophysicist $380 / hour – Senior Geophysicist
Crew and Equipment Rate – Field Operations Additional days on location over total of ~Frac Days~ days estimated in this proposal – standby rate	$ 23,800 per day

Notes:

Validity of this proposal is 08/25/2012.

The above price does not include taxes, if applicable.

Cancellation of the project four weeks or less, prior to mobilization of the Spectraseis acquisition crew and equipment will result in a fee of 35% of the contract price.

The total cost may be adjusted if the scope of the project is different to the current plan.

Permitting and its associated costs will be in addition and would be charged to ~Opportunity Account~ at cost plus 10% administrative and finance fee.

Required notice: 45 days before the planned start of fracturing operations.

Payment Terms

Payments are to be received within 30 days after invoice date.

A two-tier payment is proposed:

1. 65% due upon mobilization of the crew and equipment,

2. 35% due upon delivery of:

The Fracture events in an x, y, z, t table and visualization map

To signify acceptance of this quotation on behalf of ~Opportunity Account~ please sign below and send a copy of this proposal to:

Spectraseis Inc.

~ Account Owner~ – ~ Account Owner - Title~	~ C- Email~

Customer Signature

Name	Signature	Title	Date

Appendix A

Key components and benefits of Spectraseis’ technical solution

Microseismic processing

Spectraseis’ microseismic processing uses Time-Reverse Imaging (TRI) to harness the power of the elastic wave equation for fracture event location and characterization. TRI uses both P- and S-wave arrivals to locate and characterize fracture events. The elastic wave equation is capable of using multiples and multi-path arrivals to enhance the fracture image rather than to create false locations, as can occur with ray-based processing schemes. Spectraseis also calculates a statistical confidence factor for each event to give the interpreter a quantitative basis for selecting sub-populations of fracture events for analysis.

Spectraseis delivers a catalog of event locations in XYZ space along with event time, magnitude and confidence factor. These data can be loaded to interpretation workstations for integration with other G&G and engineering data. The result is fracture characterization tied to subsurface features of the reservoir interval. In addition, Spectraseis can deliver SEG-Y volumes of selected event images for loading to interpretation workstations

At the heart of Spectraseis’ microseismic processing system is a GP-GPU cluster capable of 100 Gigapoints of elastic model calculations, enabling full 3D elastic processing of the microseismic data. All of the recorded data is imaged, even events that are traditionally missed by processing systems requiring event picking.

Pre-project planning and modeling

Spectraseis believes that all survey design based should be based on the client’s needs and objectives rather than the limitations imposed by cables and limited boreholes. Detailed pre-project planning and modeling can optimize acquisition resources by putting the recording equipment where it will do the most good, on the surface or in a well bore. We consider not only the location of expected fracture events but also the radiation pattern of the energy away from the fracture. This modeling benefits our clients by helping them understand what the results should look like before the survey begins. It produces the highest quality surveys possible and saves our clients’ money by avoiding under- or over-designed acquisition programs.

Post-project consulting services

Spectraseis supports it clients throughout the project lifecycle as a routine part of their business. From understanding the problem and designing data acquisition through state- of-the-art data processing and analysis, we are in constant communication with our clients to ensure the results of the project meet their needs.

Data integration can be demanding so our experienced industry professionals are available to work with clients to help them integrate the project results with conventional G&G and engineering data. We first work to thoroughly understand our client’s project needs and then we can design and implement an integration workflow that maximizes the value of their project investment.

Surface equipment

Spectraseis uses ultra-high sensitivity broadband three-component sensors to record the passive wave field at the surface. These sensors record the complete ground motion in the frequencies between 0.1-1000 Hz and are 100 times more sensitive than standard geophones. This extra sensitivity allows the recording of 3-4 times the number of events seen by standard geophones. The additional bandwidth of the Spectraseis sensors provides more accurate fracture characterization.

All of Spectraseis’ seismic recording equipment is three-component, broadband sensors that record to individual digitizing nodes. Time synchronization is achieved through the GPS time clock. This provides the flexibility to design the survey needed to solve the problem rather than designing a survey that is limited by the available equipment. A summary of the equipment technical specifications is shown in Table 1.

Table 1

3C Sensor	3C Geophone	1C Geophone
Sensor name Sensor type Tilt tolerance Noise floor Sensitivity Freq. range	Nanometrics T-40 forced feedback 1 deg. low 1500 V/(m/s) 40s-50 Hz	ION Trimetric mass & spring 2 deg. low 4800 V/(m/s) 0.1-1000 Hz	Secret SG-10 mass & spring ~20 deg. high 20-30 V/(m/s) 10-1000 Hz

Borehole array

High-sensitivity, broadband downhole recording is achieved with the UltraSense™ borehole array instrument. The instruments employs the same high-sensitivity, broad- band sensors as in our surface recording equipment but deployed down hole, at or near the reservoir level. These data provide additional fracture location information and characterization as well as calibration of the surface microseismic recording. The array is conveyed swiftly and safely via tubing string into any well with 5.5 in casing or larger and data from the individual sondes are synchronized through the GPS clock. The technical specifications of our borehole sensors are shown in
Table 2

Table 2

UltraSenseTM borehole sonde	Sensor	Digitizer	Deployment
3-component mass and spring max 20° well dev. 4800 V/(m/s) 0.1 – 1000 Hz -200 dB noise floor	Downhole 24-bit A/D 0.5-100 ms SR -200 dB noise floor 4 ms/day time accuracy GPS synchronized	Tubing-deployed Max depth 8000 ft Max press. 5000psi 5.5” casing minimum

Advanced fracture analysis

Time-Reverse Imaging of the surface microseismic data directly images the fracture radiation patterns. These images contain information on the fracture strike, dip, and relative motion. Because the images are tied to the 3D seismic data via the common migration velocity model, fracture images and their information can be directly tied to equivalent locations within the 3D seismic volume. The TRI images can be combined with the engineering data from a well stimulation program to design more effective fracture treatments for your reservoir.

The increased sensitivity and broad band width of the Spectraseis acquisition equipment provides data allowing the detection of a larger number of weaker fracture events. In addition, moment magnitude calculations on individual events are more accurate than with conventionally recorded microseismic data.

Field Acquisition Crews

Spectraseis has an experienced HSE and Operations Group leadership team drawn from major oil companies and contractors. We have a full, audited HSE Management System. Spectraseis operates safely and effectively in challenging environments all around the world. We have built a flexible operating capability that meets and exceeds industry standards for international geophysical contractors.