CASPIAN WIRELINE SERVICES, LTD. IS READY FOR BUSINESS EXPANSION IN AZERBAIJAN


Caspian Wireline Services, Ltd.

President, CEO Calvin Wilson

Since November 2000, Caspian Wireline Services LTD, CWS, has been providing wireline logging and perforating services to oil production companies in Azerbaijan. CWS specializes in providing high quality cost effective services in the Caspian Sea region. In cooperation with Azeneftmadangeophysica Trust, CWS strive to provide solutions fit for the marketplace and deliver the services required in an efficient manner.

Due to the significant well control issues encountered when drilling near the mud volcanoes in Azerbaijan, CWS has recently added Drilling Data Logging services. In addition to mud logging and cutting analysis, real time drilling data is displayed on the rig floor and in the company representative's office enabling close monitoring of pit volumes and gas detection systems. This service line began as an effort to compliment the Mud Logging services provided by Azeneftmadangeophysica Trust and has now evolved to CWS providing the equipment and utilizing some Trust employees to provide the services. Supervisors with extensive experience have been employed to continually improve the services provided, train local personnel and ensure good communication on the rigs. In addition to the monitoring services, the Wildcat Automated Drilling System provided by Varco can be leased through CWS to companies operating in the Caspian Sea region.

Open Hole Logging Equipment manufactured by Tucker Technologies, Inc. in Tulsa, Oklahoma, USA is utilized to provide a full range of services required in this region. CWS is providing these services for Karasu Operating Company and have utilitzed the fully digital logging equipment for other companies in Azerbaijan and Georgia since purchasing the equipment in 2001.

CWS and Read Well Services in Norway have an agreement to provide borehole seismic services in Georgia and Azerbaijan. Read Well Services provides high level data acquisition and processing services for companies operating around the world and working with Read enables CWS to offer very high quality services in a cost effective manner.

In Azerbaijan, very large numbers of older wells have been reworked to maintain and increase the production of several fields and there are a large number of additional wells that have potential. Over the past four years, CWS has focussed on helping our customers evaluate existing wells and perform operations to enhance the production.

CWS offers the Pulsed Neutron-Neutron produced by Hotwell in Austria and this tool is proving to provide very good data in the low salinity environment. Karasu Operating Company has used this service in over 40 wells and the development managers are finding the data very reliable and useful in reducing the risks associated with reworking the older wells by helping them assess the potential candidate wells. In addition to water saturation, borehole isolation through cementation is very important and CWS is now adding the Radial Bond Tool provided by Sondex to improve the cement bond evaluation methods.

In Azerbaijan, the near well bore damage is very significant in the majority of the older wells and CWS utilizes premium perforating systems produced by Owen Oil Tools in Fort Worth Texas USA to provide deep penetration perforations. Over the past four years, significant increases in production have been realized by utilizing these charges to perforate new and previously perforated intervals. Operating companies in the region have tried charges from other suppliers and found that the premium charges from Owen definitely provide deeper penetration and the result is increased production.

During the well workover and drilling operations, operating companies occasionally require pipe recovery services to locate the stuck point and release lodged downhole equipment. CWS offers the Radial Cutting Torch from MCR Oil Tools in Fort Worth, Texas USA and this tool provides a very clean cut without significant hazards for shipping and handling. Jet cutters and Colliding Pipe Severing tools are provided through Owen Oil Tools. The Colliding EBW detonators are licensed to Owen Oil Tools from the US government and provide the ability to sever drill collars in extreme conditions.

Recently, the opportunity has arisen to offer improved well testing capabilities in Azerbaijan and CWS has imported equipment from the US to provide electronic monitoring along with improved three phase separators, choke manifolds and other equipment. During the testing phases for new wells, CWS provides TCP services, pressure gauges deployed via the TCP drop bar and an additional gauge deployed in a bombwell that can be deployed and retrieved during the test. On the surface, pressure and temperature are measured at various points along with the gas, oil and water flow rates from the output of the separator and fluid level in the storage tank are recorded and monitored.

CWS is very grateful for the opportunity to do business in Azerbaijan over the last four years and we are planning to continue for many more years. CWS entered this market to provide high quality services, efficiently and in a cost effective manner. Our mission is to help our customers identify opportunities and through cooperation from vendors worldwide, provide the products and services that will help our customers realize greater success in their operations.

Through support from suppliers around the world,

CWS is currently providing the services listed below:

- Drilling Data Logging

- Automatic Drilling System

- Open Hole Logging

- Borehole Seismic Services

- Cased Hole Logging

- Production Logging

- Perforating: Wireline & TCP Pipe Recovery Services

- Well Testing