Oil & Gas Market and Core Operations Overview

1. Oil & Gas Market and Core Operations Overview Ram Mistry M (214) 608-9304 Ramniklal.Mistry@VerizonWireless.com

2. Business Challenges for Oil & Gas • Decline in the price of oil - overall market volatility • Competitive market cutback strategies • Economic impacts • Increasing regulatory requirements • State-sponsored hacking and associated security risks • Increasing data needs

3. Supply and Demand Demand Supply • US Production • US Inventories • US Shale BE Cost of $40 • US 1.1M Wells • No OPEC Production Cuts • Iraq/Iran • Russia • Venezuela • New discoveries and long lead projects • US: Solar and Wind • US GDP: 2.3% ave • China GDP • India GDP • Japan Negative GDP • Eurozone uncertainty • Electric Cars • Increasing vehicle mpg • Auto share and ride share programs • IoT and Workforce optimization

4. Global Market by the Numbers: Supply & Demand

5. Global Break-Even Costs

6. US Oil & Gas Industry by the Numbers • 1.1M Oil and Gas Well Heads; 1,880 Drill Rigs • Petroleum and Natural Gas Extraction: • 11,500 companies(184,000+ Employees) • 352 companies with > 50 Employees (108,000 Employees) • 200,000 miles of crude oil and refined petroleum product pipelines • Pipeline Transport Companies: • 5,090 companies(72,000+ Employees) • 139 companies with > 50 Employees (32,500 Employees) • 38 Jones Act vessels (U.S. flag ships that move products between U.S. ports) • 3,300 coastal, Great Lakes and river tank barges • 200,000 rail tank cars • 144 refineries • 1,400 petroleum product retail, 100,000 tanker trucks, and 123,289 Convenience stores selling Gasoline • 475,000 storage tanks

7. US Oil & Gas Industry Core Operations Transport Land Management Production/Storage Refine Drilling/Completion Transport Terminal Retail Seismic

8. US Oil & Gas: Drilling and Well Completion • Drilling/Completion: • Cost to Oil & Gas company: $5M+ per Drill Rig per Well Head(s) • Drill Rigs • 6-8 weeks per well (mobile asset) • Typical deployment in rural areas • 25-30 people onsite from different vendors • 500MB/month/Rig • New development of Multiple Lateral Drills per pad site (2 to 24 drills per pad) • 10% to 20% estimated miss rate: miss pocket completely or hit the pocket partially • 50+ sensors per Rig collecting data: Power/Generators, Tank Levels, Gas emissions, Toxic compounds from drill site, etc. • Data stored locally on Hard Drive and then sent to Petroleum Engineers (90% of Rigs are not connected to the network)

9. Mobile Communications Solution Mobile Communications Solution Dynamic Mesh • Cellular Only • Cellular Primary + Satellite Secondary

10. US Oil & Gas: Transport • Green: Oil pipelines • Red: Natural Gas pipelines • Blue: Refined Petroleum pipelines • Characteristics of Crude Oil pipelines: • Up to 48 Inches in diameter • Flow rate of up to 510K barrels per day for Trans Alaska Pipeline System • Oil movement of 1 to 6 meters per second • Pinhole size leak at 1.5% of max flow rate for 14 days – 189K barrels of oil leaked (source PHMSA) Source: Theodora 160K+ miles of pipeline with an average of 1-2 sensors per mile

11. Chevron Pipeline

12. Requirements Improve efficiency with an end-to-end, integrated platform and solutions. Leverage expertise from consultants/professional services. Increase effectiveness by interpreting data correctlyin near real-time. Enhance operational efficiencies with mobile management and workforce optimization Protect all lines of business by managing risk across the board. Maintain compliance with strict security policies. Focus on core business.