CONFIDENTIAL INFORMATION DISTRIBUTION IS PROHIBITED WITHOUT SDT WRITTEN PERMISSION

SDT EXECUTIVE SUMMARY

ARMADILLO FIELD - EASTERN ECUADOR
April, 2016
PROJECT OBJECTIVES:

SDT to maximize asset value by providing specific services: build

access road, drilling platform, drill 12 wells, early production facilities,
pipeline and surface facilities in a 3 year investment program for
the Armadillo Field, operated by Petroamazonas EP.
To create value by applying state of the art, proven production and
reservoir engineering principals along with new operating
technologies.
To develop the Armadillo Field jointly with ECUASERVOIL by
production optimization, stimulation, re-completion, secondary
recovery, EOR, infield drilling while yielding superior financial results.
Raise USD 50 MM capital, which represents about 39% of the USD
123 MM total planned and approved investment in the field.

BACKGROUND:

ARMADILLO FIELD OPERATOR: PETROAMAZONAS EP, Ecuadorian

State Company
SERVICE CONTRACTOR: ECUASERVOIL: 90% Belorusneft (Belarus
National Oil Co); 10% EDINPETROL (Ecuadorian Co.). Specific
Services and Finance Contract C0348-PAM-EP-2015 between
PETROAMAZONAS and ECUASERVOIL was signed in Feb, 2015 and
re-negotiated in April 2016.
LOCATION: Eastern Ecuador. Southwest of the Puma Field.
TERM OF CONTRACT: 15 years from May, 2016
TECHNICAL INFORMATION: Current Production: 335 bopd;
Proven + Probable Reserves: 12.3 MMB (as reported by Ryder Scott),
Estimated Daily Production New Drilling: 450 estimated bopd/well
(potential up to 800 bopd/well); Reservoirs: U Inferior Sand and
Basal Tena Sandstone. 3D Seismic is available now for interpretation.
1

CONFIDENTIAL INFORMATION DISTRIBUTION IS PROHIBITED WITHOUT SDT WRITTEN PERMISSION

MAIN SERVICES TO BE PROVIDED BY ECUASERVOIL:

Production Optimization, Well intervention, Construction of road,
pipelines and Production Facilities.
PAYMENT FEE: A variable rate per incremental barrel of oil, indexed
to the WTI price. A minimum of USD 15 and a maximum of USD
33.20 per barrel:
WTI
RATE

30,00
15,00

40,00
19,6

50,00
24,1

55,00
26,4

60,00
28,7

65,00
30,9

70,00
33,20

DEVELOPMENT AND INVESTMENT PLAN: USD 123MM for

Geoscience Studies (3D seismic interpretation) Drilling: 12 wells: 9
development, 2 appraisal, 1 water injection. Surface Facilities, access
road, drilling platform Armadillo B, early production facilities, pipeline
& Engineering.
SDT & ECUASERVOIL AGREEMENT: SDT has been offered 39% of
ECUASERVOIL in exchange for obtaining financing (USD 50 MM
payment of this financing will be split between ECUASERVOIL and
SDT) and providing Integrated Services for the above described
investment plan. EDINPETROL will provide the remaining 10%
financing (about USD 12.3MM). ECUASERVOIL will pay SDT for the
provided services at market prices and will share with SDT 39% of
the incomes.

SDT & ECUASERVOIL NEEDS:

USD 50 million financing for a 15-year period, at a reasonable interest

rate. This financing will be paid with the revenues generated by the
development plan of Armadillo field. Guarantee is a trust that will
manage the funds generated by the project.
In the next page we have included the cash flow figures for this
project, considering a 450 bopd/well production.
Should you have any questions about this project, please contact
SDT Integrated Solutions, www.sdt.ec:
richard.aldaz@sdt.ec. Cell: +593 995879843
guillermo.burbano@sdt.ec. Cell: +593 983540075

ECUASERVOIL
2016
Yearly Oil Production,barrels
41.298,89
Rate per bopd
19,55
Total Revenue
807.393,31
USD 25MM Capital payments
Interest over 25MM loan @ 7%
ECUASERVOIL OPEX
2.000.000,00
Initial investment repayment USD 6 MM

2017
488.024,49
24,10
11.761.390,16
994.865,62
1.750.000,00
2.000.000,00
801.139,02

-1.192.606,69

6.215.385,53
1.153.808,86
5.061.576,67

Operating Income
Taxes
NOPAT

-1.192.606,69

2016

SDT
Total Revenue
SDT OPEX
CAPEX
USD 25MM Capital payments
Interest over 25MM loan @ 7%
Cash Flow
Taxes
50MM loan @ 7% interest
Net Cash Flow
Saldo Inicial
Cummulative Cash Flow

180.000,00
19.447.040,22

-19.627.040,22
15.000.000,00
-4.627.040,22
0,00
-4.627.040,22
IRR
NPV

2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
1.322.390,21 1.413.489,91
1.203.201,01 1.024.197,39
871.824,64
742.120,82
631.713,40
537.731,61
548.761,86
565.648,73
482.190,02
377.819,51
28,65
30,93
33,20
33,20
33,20
33,20
33,20
33,20
33,20
33,20
33,20
33,20
37.886.479,51 43.712.175,35 39.946.273,51 34.003.353,26 28.944.578,09 24.638.411,22 20.972.885,00 17.852.689,50 18.218.893,74 18.779.537,77 16.008.708,64 12.543.607,62
1.064.506,21 1.139.021,65
1.218.753,16 1.304.065,88 1.395.350,49 1.493.025,03 1.597.536,78 1.709.364,35 1.829.019,86 1.957.051,25 2.094.044,84 2.240.627,98
1.680.359,41 1.605.843,97
1.526.112,46 1.440.799,74 1.349.515,12 1.251.840,59 1.147.328,84 1.035.501,26
915.845,76
787.814,37
650.820,78
504.237,64
2.000.000,00 2.000.000,00
2.000.000,00 1.000.000,00 1.000.000,00
750.000,00
750.000,00
750.000,00
750.000,00
500.000,00
500.000,00
500.000,00
3.420.612,01 1.778.248,97

2030
297.526,58
33,20
9.877.882,59
2.397.471,93
347.393,68
500.000,00

2031
TOTAL
84.625,52 10.632.564,59
33,20
2.809.567,34 338.763.826,59
2.565.294,97 25.000.000,00
179.570,65 16.172.984,26
500.000,00 17.500.000,00
6.000.000,00

29.721.001,88 37.189.060,75 35.201.407,89 30.258.487,64 25.199.712,47 21.143.545,61 17.478.019,38 14.357.823,88 14.724.028,12 15.534.672,16 12.763.843,03
7.338.216,88 9.037.990,20
8.461.932,26 7.391.990,28 6.200.652,84 5.277.534,14 4.427.235,73 3.711.143,90 3.839.935,53 4.102.772,65 3.479.561,80
22.382.785,00 28.151.070,55 26.739.475,63 22.866.497,36 18.999.059,63 15.866.011,47 13.050.783,66 10.646.679,98 10.884.092,59 11.431.899,50 9.284.281,22

9.298.742,00
2.691.860,22
6.606.881,78

6.633.016,97
2.100.730,02
4.532.286,94

-435.298,28 274090842,3
449.720,77 69.665.086,09
-885.019,05 204425756,2

2017
2018
5.061.576,67 22.382.785,00
250.000,00
250.000,00
30.330.823,92 29.593.013,59
994.865,62
1.064.506,21
1.750.000,00
1.680.359,41
-28.264.112,87 -10.205.094,20
3.567.951,99
25.000.000,00 10.000.000,00
-3.264.112,87 -3.773.046,19
-4.627.040,22 -7.891.153,10
-7.891.153,10 -11.664.199,29
62%
22.934.817,99

2019
28.151.070,55
250.000,00

2020
24.931.417,26
250.000,00

2021
8.917.933,97
250.000,00

2022
7.409.633,25
250.000,00

2023
6.187.744,47
250.000,00

2024
5.089.805,63
250.000,00

2025
4.152.205,19
250.000,00

2026
4.244.796,11
250.000,00

2027
4.458.440,81
250.000,00

2028
3.620.869,68
250.000,00

2029
2.576.683,89
250.000,00

2030
1.767.591,91
250.000,00

1.139.021,65
1.218.753,16
1.605.843,97
1.526.112,46
25.156.204,93 21.936.551,65
5.307.949,46
4.778.466,32

1.304.065,88
1.440.799,74
5.923.068,35

1.395.350,49
1.349.515,12
4.414.767,64

1.493.025,03
1.251.840,59
3.192.878,85

1.597.536,78
1.147.328,84
2.094.940,01

1.709.364,35
1.035.501,26
1.157.339,58

1.829.019,86
915.845,76
1.249.930,49

1.957.051,25
787.814,37
1.463.575,19

2.094.044,84
650.820,78
626.004,06

2.240.627,98
504.237,64
-418.181,72

2.397.471,93
347.393,68
-1.227.273,71

2031

TOTAL
128.952.554,40
250.000,00
3.930.000,00
79.370.877,74
2.565.294,97 25.000.000,00
179.570,65 16.172.984,26
-2.994.865,62
13.654.367,77

19.848.255,47 17.158.085,33 5.923.068,35 4.414.767,64 3.192.878,85 2.094.940,01 1.157.339,58 1.249.930,49 1.463.575,19

626.004,06
-418.181,72 -1.227.273,71 -2.994.865,62
-11.664.199,29
8.184.056,18 25.342.141,51 31.265.209,86 35.679.977,50 38.872.856,36 40.967.796,36 42.125.135,94 43.375.066,43 44.838.641,62 45.464.645,68 45.046.463,95 43.819.190,25
8.184.056,18 25.342.141,51 31.265.209,86 35.679.977,50 38.872.856,36 40.967.796,36 42.125.135,94 43.375.066,43 44.838.641,62 45.464.645,68 45.046.463,95 43.819.190,25 40.824.324,63

40.824.324,63