REASONS TO COAT

INTRODUCTION

Tuboscope invented the internal tubular coating process in the 1930s and has led this global
industry ever since, pioneering the use of advanced plastic coatings technology to substantially
enhance the performance of your tubulars and your bottom line.

Our coating services enhance your tubulars' performance and your bottom line.

Raw materials - which are manufactured in Houston, Texas, and applied at 14 plants around the
world - have consistently set the standard for maximizing the useful life of tubulars - reducing
wear, increasing hydraulic efficiency, preventing corrosion and controlling the buildup of harmful
scale, paraffin or asphaltene.

All of which enhances your bottom line by helping you get the most value from your tubulars, the
most productivity from your operation and the most profit from your investment.

Our Tube-Kote line of internal plastic coatings is the world's most comprehensive, including
phenolic, epoxy, urethane and new thermoplastics that are designed to address the unique
operating needs of specific oilfield environments.

These coatings are available in thick and thin films that are applied in powder or liquid form over
our proprietary primers to deliver maximum adhesion and superior downhole performance.

In addition to SOCOTHERM AMERICAS coating activities, Tuboscope conducts extensive

research and development to improve the capabilities of our coatings. One outstanding success
is TK-34XT, the latest generation of TK-34, the world's first, and still industry-standard, drill-pipe
coating. This new, innovative formula has been refined to make it the most abrasion-resistant
coating in the world.

Clearly, TK-34XT is just one reason why, after half a century, Tuboscope continues to be the first
name in tubular coatings worldwide.

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Capital Federal (1002) - Argentina Escobar (1625) Buenos Aires - Argentina
Ph./Fax: +54 - 11 - 4312 - 9960/61 Ph.: +54 - 3488 - 493332
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Coating process

This proprietary application process ensures the superiority of our

coatings' performance.

Without proper application, even the best coating will not perform as expected, because
adherence to the tubular's surface is one of the most critical factors in ensuring long-term
performance.

Step 1

The first step in Tuboscope's application process is a thorough thermal cleaning of the tubular to
remove any residual hydrocarbons. This is accomplished by pre-baking the pipe to ~750 F for
up to eight hours.

Step 2

Next comes an abrasive blasting with aluminum oxide that creates an anchor pattern which is
optimal for adhesion. Tuboscope uses the NACE #1 white-metal finish as our blasting standard,
to ensure the highest level of quality.

Step 3

For liquid coating applications, a proprietary spinning-spray system deposits the appropriate
coating onto the tubular's surface, smoothly and uniformly. Then, after each layer of liquid
coating is applied, the tubular is baked and partially cured.

For some powder coating applications, a lance system applies a thick, even film coating. A
vacuum system can also be used to draw a standard amount of the coating into the heated
tubular, spreading an even layer throughout the internal pipe wall.

CORPORATE OFFICE HEAD OFFICE

25 de Mayo 565 - 4th Floor Ruta 9 km 52.3
Capital Federal (1002) - Argentina Escobar (1625) Buenos Aires - Argentina
Ph./Fax: +54 - 11 - 4312 - 9960/61 Ph.: +54 - 3488 - 493332
Fax: +54 - 3488 493314

socotherm@socotherm.com.ar / www.socothermamericas.com.ar
Step 4

The final step is the heat-curing of the internally coated tubular, which causes the thermoset
polymers to crosslink between primer layer(s) and top-coat layer(s), forming a homogenous
coating which is then subjected to our standard quality-control inspections.

The result: a high-quality, tightly adhered and uniform coating surface throughout the tubular
wall that offers maximum corrosion protection for years to come.

Higher quality standards yield higher quality coatings.

The industry's most stringent quality-control procedures cover each aspect of our coating
services, from formulation to manufacturing to application.

Our ISO-based quality program assures that our coatings are applied consistently and bond
securely, to meet both our extraordinary standards and your specifications.

In 1990, all Tuboscope operations adopted 100% holiday-free as standard on coating of all
tubing, casing and line-pipe applications, exceeding the current industry standard of 90%.
SOCOTHERM AMERICAS 's superior standards are designed to supply you with consistently
higher-quality coating performance.

Reasons to coat.
Tube-Kote coatings improve the economics of every drilling and production job.

When utilized as part of an integrated treatment program, Tube-Kote coatings can help cost-
conscious drilling and production companies realize superior returns on their long-term
investments in tubulars and drill pipe.

More cost-efficient than the alternatives - corrosion resistant alloys, chemical-inhibitor programs
and other methods that use coatings/linings that are not chemically or mechanically bonded -
tubulars and drill pipe coated by Tuboscope can improve the economics of every drilling and
production job they're used on.

CORPORATE OFFICE HEAD OFFICE

25 de Mayo 565 - 4th Floor Ruta 9 km 52.3
Capital Federal (1002) - Argentina Escobar (1625) Buenos Aires - Argentina
Ph./Fax: +54 - 11 - 4312 - 9960/61 Ph.: +54 - 3488 - 493332
Fax: +54 - 3488 493314

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Since most drilling muds are water-based, they are capable of causing extensive corrosion
pitting. Aggravating this problem is the oxygen that's picked up as the mud circulates through
the shaker, pumps and mud pit, and the CO2 and H2S that is picked up from the formation.
Through the drilling operation, the gradual increase in the concentration of these species greatly
increases the fear of corrosion related failures.Corrosion can exacerbate the stresses that
severe drilling operations inflict upon your drill pipe, leading to the rapid development of fatigue
cracks and, ultimately, a catastrophic downhole pipe failure.Approximately 85% of fatigue
failures occur near the pipe's upset area, where the reduction in bodywall from the tool joint to
the pipe body localizes the stresses adjacent to the upset region - causing a costly failure to
occur relatively early in the life of your drill pipe. Putting your drill pipe on a coating program can
maximize your drill pipe investment and improve the hydraulic efficiency if that asset.

When using your drill pipe for completion operations, internal plastic coating will help prevent
the production and deposition of iron based scales. These scales can be very detrimental in the
completion of a well. This mitigation of the iron based scales production and deposition will also
provide significant savings by alleviating the need for acid picking your completion string.

As production activities move into deeper, hotter environments, the forces attacking your
production tubulars dramatically increase, threatening their useful life. And, as additional fields
are put into water flood, CO2 flood and other forms of enhanced recovery, the corrosiveness of
the produced fluids increases as well as the threat of organic and inorganic deposition.
Moreover, the cost of workovers and the losses from having a well out of production continue to
mount, making the corrosion of your tubulars a very expensive problem.All of which points to the
added value of Tube-Kote coatings, which are increasingly vital to keeping the cost of drilling
and production jobs under control.

Maximize profit performance by improving hydraulic performance.

Until recently, most operators have overlooked the hydraulic benefits that they have gained by
using internally coated pipe. These benefits include increased production from oil and gas wells,
increased throughput in flowlines, decreased horsepower/utility requirements, increased
injection rates for disposal wells, and lower compression costs for natural gas transmission
companies. The key to superior profit performance is the hydraulic performance of your
tubulars, because even the slightest amount of friction inside your tubulars can seriously disrupt
the flow of product, thus increasing costs. Much of the power required to pump or produce fluids
is needed simply to overcome the resistance imposed by friction between the fluid/gas and the
pipe's uneven surface. However, since coated surfaces are much smoother than bare steel
surfaces, they present very little resistance to the flow of liquids or gases.Case histories have
indicated flow increases up to 25% under normal operations, and up to 90% in extreme cases.
This flow increase can allow you coating investment to be paid for in less than one day of
operation. This hydraulic benefit can also allow a smaller pipe size to be used while still
experiencing expected flow numbers. This can be very beneficial in casing limited situations, or
to minimize raw material, transportation and handling expenses.

CORPORATE OFFICE HEAD OFFICE

25 de Mayo 565 - 4th Floor Ruta 9 km 52.3
Capital Federal (1002) - Argentina Escobar (1625) Buenos Aires - Argentina
Ph./Fax: +54 - 11 - 4312 - 9960/61 Ph.: +54 - 3488 - 493332
Fax: +54 - 3488 493314

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 Laminar flow: all fluid particles Turbulent flow: local fluid velocities Surface roughness: uneven
move in distinct and separate and pressures fluctuate irregularly. surfaces cause fluid drag,
streams. impeding flow.

Flow Assurance - Deposition Mitigation

An obstruction caused by the buildup of organic deposits such as paraffin and asphaltene and
inorganic deposits such as scale can also inhibit a tubular's hydraulic performance and overall
ability to flow. Factors such as temperature changes, pressure changes and solubility changes
can induce the precipitation of paraffin, asphaltene and scale. Once begun, the buildup process
accelerates and intensifies, choking the tubing or flowline. Knowing that these species look for
both a chemical binding site as well as a mechanical anchor pattern for a deposition point,
promotes the use of Tube-Kote coatings for deposition mitigation. Tube-Kote coatings offer a
reduced surface roughness and therefore a minimal anchor pattern for mechanical binding.

This in conjunction with the mostly chemically inert

surface slows or completely stops the threat of
deposition. History has proven internal coatings
effectiveness in the mitigation of paraffin and scale
deposition. Recent successes have also shown
the benefit of certain Tube-Kote coatings in the
mitigation of asphaltene deposition. These
successes have shown that the use of internal
plastic coating can either completely stop the
deposition or minimize it to the point that the
reduction in chemical and mechanical treatments
more than pay for the coating in a short period of
time. Production is obstructed and can When treatment does become necessary, the
eventually be choked off by paraffin Tube-Kote coating will protect your tubular
deposits which build up on an investment from the harsh chemical and me-
uncoated tubing surface like this one. chanical treatments that may be
necessary.

CORPORATE OFFICE HEAD OFFICE

25 de Mayo 565 - 4th Floor Ruta 9 km 52.3
Capital Federal (1002) - Argentina Escobar (1625) Buenos Aires - Argentina
Ph./Fax: +54 - 11 - 4312 - 9960/61 Ph.: +54 - 3488 - 493332
Fax: +54 - 3488 493314

socotherm@socotherm.com.ar / www.socothermamericas.com.ar