Native American Initiative

Strategic Center for Natural Gas and Oil

For GAO Review 1997-2007

August 09, 2007

Targets resources on tribal lands 890 million bbls oil 5.6 trillion ft3 of gas

Helps tribes develop and manage energy resources while protecting the environment

Stimulates economic development of oil & gas

Promotes Tribe-industry partnerships

22 projects funded from 1994 to 2004

Program Description

Participating Tribes

Assiniboine & Sioux Crow (2) Eastern Shoshone &

Northern Arapaho Hopi Inupiat Jicarilla Apache (3) Northern Cheyenne Osage (5) Southern Ute Three Affiliated Tribes Ute Ute Mountain Ute

Goals

Promote dialogue among tribes, industry, and researchers

Develop and demonstrate innovative petroleum technologies

Increase exploration and development activity on tribal lands

Increase oil and natural gas production on tribal lands

Create jobs for tribal members

Budget Level

Phase Period Projects # DOE

$K

DOE

%

Perform

$K

Perform

%

Total $$K

I 1994-1998

6 1,623 100% 0 0% 1,632

II 1996-2000

7 818 100% 0 0% 818

III 2000-2003

5 1,943 70% 833 30% 2,776

IV 2002-2005

4 1,778 62% 1,109 38% 2,887

Total 22 6,162 76% 1,942 24% 8,104

SuccessEnhanced Oil Recovery by Horizontal Waterflooding

Osage Tribe and Grand Resources Inc.

Goal: Demonstrate that horizontal

waterflooding can be technically and economically successful

Accomplishments: An abandoned field was revived Technology successfully used in

a nearby 100 year old field Production went from 0 to a total

of 100 bopd for the two fields Expected ultimate production for

the test wells is 29,000 bo

Enhanced Oil Recovery by Horizontal Waterflooding - Osage Tribe cont’d

Benefits: Technology can increase

production in poorly performing waterfloods and thereby reduce field abandonments

Demonstration scale horizontal waterflood could generate $2.9 million over 6 years

Vertical waterflood would generate $1.4 million in 30 years

SuccessNorth Hill Creek 3-D Seismic Exploration Ute Tribe and Wind River Resources Corp.

Goals: Use 3D seismic surveys to

assess oil and gas potential

Accomplishments: 15 wells drilled with a 100%

success rate Royalty revenue for the Ute Tribe

was $5,000 per day Identified 1 formation that had

never been produced commercially

1 formation had never been produced in that part of the basin

North Hill Creek 3-D Seismic Exploration Ute Tribe and Wind River Resources Corp. cont’d

Benefits: Demonstrated the value of 3D seismic

surveys

Success spawned 11 additional surveys during the year following project

Survey cost of $1.5 million is less than cost of 1 dry hole

Increased gas production on Ute Tribal lands

Provided a new revenue stream for the Ute Tribe

Program Accomplishments

1.84 BCF natural gas produced

2 TCF unconventional gas resource identified

19 Exploration leads discovered

2 plays with high potential for oil and gas

Estimated $260 million in economic activity on tribal lands plus

$40 million in direct tribal royalty payments expected from the program over next 20 years