Fortaleza Energy Inc August 2014 Rational for the Acquisition of Stimsol Business from Arcan Resources Ltd and the Creation of BlendForce Energy Services Inc. Vision – Rapidly Changing Industry Improving Commodity Prices however there remains significant risks with continued success of resource play development in North America Resource Play Development – large land position – deep drilling inventory – profits driven with field execution- cost reductions. Resource Plays returns are very sensitive to costs and commodity prices Significant shift down market in Companies being financed – however investors remain selective Vision - Investment Opportunity Stimsol Acquisition from Arcan Resources Operating Business Immediate Cash Flow Low maintenance capital No outside equity requirement Growth opportunities Very quick payback – less than two years Potential to pay dividends in the future Diversified lines of business Exploration – variety of resource plays Production – existing producing wells Complete management team in place and operating the business History of Stimsol Stimsol created in 1983 Operating in Red Earth Creek Stimsol Acquired by Arcan in September 2011 for $24.5mm. Business consisted of: 1. 2. 3. Proprietary Acid Blend with $134/m3 royalty 5 C&A Pumpers, 7 Pressure Tank Trucks Production Services Business employing 85 people with operational bases located in Grande Prairie, Blackfalds and Red Earth Creek. Corporate Office and Lab based in Calgary. In 2012 , acquired Firm Acid Supply from Canexus and Univar for 80,000 m3 per In 2011, commenced construction of Acid Blend Facility in Swan Hills for $7.3mm - commission in November 2012. 2013 disposed of $8.0mm of equipment. Terminated take or pay acid supply contracts with Univar and Canexus The Acquisition – Stimulation Fluid Blending Facility Arcan has agreed to sell to Fortaleza the assets and business of StimSol for $2.5mm. Assets: The Swan Hills Blending Facility site operated by StimSol located within the town of Swan Hills, Alberta consisting of 48,400 sq. meter site governed by municipal and provincial surface lease. Disposal Well located within facility site LSD 2-14-66-10 W5M and bottom hole located at LSD 8-14-66-10 W5M and all equipment associated with asset and special assignment of disposal zone rights Warehouse & Office Building (50ft X 120ft), including office furniture, pump room and load cell station and QC lab and associated equipment. 10 – 750 bbl fiberglass acid tanks within containment 4 – 400 bbl steel storage tanks within containment 4 – 100 bbl steel storage tanks within containment All equipment associated with handling, blending and shipping of all products produced out of the Swan Hills Facility. Office, Lab and computer equipment located at 7874 – 10th Street N.E. Calgary, Alberta and the assignment of the commercial lease agreement. Vision – Maximizing Value of Service Area Blendforce Swan Hills Service Area – 250 KM Carbonate Play Light Oil Resource Play being exploited with Horizontal multi stage acid fracs. 840 sections of oil charged platform reef. Estimated Unconventional OOIP of 2.5 billion bbls with per section OOIP of 1.6 -6.2mmbbls – “Sleeping Giant” Wells Drilled Since 2006 Play Types – Undrilled LSDs Swan Hills – Carbonate Play 35% Acid 1. Acid in the Field Acid Frac – 1,000 cubic meters - 33 Truck Loads Diluted to 28% and chemical added: 2. Friction reducers Corrosion inhibitors Solids Controls Demulsifier Spearhead – 200m3 per job – any horizontal stage fracs. Diluted to 15% and chemicals added Corrosion inhibitors Solids Controls 3. Stimulation Fluid –Well Cleanouts – Scale Removal -15 m3 per job Diluted to 15% and chemicals added Every producing well with associated water requires Acid treatment Specialty Chemical Blends 4. Flow Back Fluid Disposal Disposal Well Fortaleza Public Co TSX V Listing Oil and Gas Meets Minimum Listing Requirements for TSX-V $4.7mm @10% Buick Creek BlendForce Acid Frac Fluid Blending & Supply Acid Stimulation & Production Enhancement Fluids Flow Back Water Disposal Pine Creek Petroleum Based Frac Fluid Supply Logicss Revenue Streams and Field Margins $/m3 Scenario 1 Scenario 4 Field Price Acid Frac Supply BlendForce Pumper $ 700 $ 850 Raw 38% Acid @ Bruderheim Trucking Swan Hills Cost of Added Chemicals Blending Costs Trucking to Location Total Cost of Supply $ $ $ $ $ $ 175 55 140 20 55 445 Net Margin $ Volume for Diluted Acid per Job m3 Number of Trucks Loads Days of Blending and Shipping Revenue per Job Gross Margin Per Job Cost Savings Per Job $ $ $ 175 140 $ $ 110 425 255 $ 425 900 33 1 $ $ 900 33 8 Scenario 5 Scenario 6 Load and Frac 15% Water Go HCLSpearhead Disposal Savings BlendForce BlendForce Pumper Savings $ 310 $ 330 $ 450 $ 120 $ 18 $ $ 118 $ 79 $ 55 $ $ $ 134 $ 181 $ 3 $ 176 $ 149 $ 15 15 1 7 630,000 $ 765,000 $ 135,000 $ 229,500 $ 382,500 $ 36% 50% $ 296,700 48 15 200 7 1 200 2000 60 4,650 $ 66,000 $ 90,000 $ 24,000 $ 2,640 29,800 $ 57% 45% $ 24,000 36,000 30,000 83% Identified Work 2014 Q1 28% Acid Fracs Supply 15% Spearhead Load and Go Water Disposal 28 120 Licenced Carbonate HZ Wells in the service area 2015 Q2-Q4 13 10 89 Q1 11 12 42 11 Q2-Q4 18 8 92 18 Expansion Opportunities Transportation From Terminal to SHAW Blending Facility - $50/m3 From Shaw Blending Facility to Field – $50-75/m3 New Location Blending Facility is new location SE Saskatchewan - Bakken Fort Nelson -NE BC Montney Supply Logistic Management for Frac Fluids Fluid & Logistics Management Water and Petroleum Based Fracs Flow Back Water Disposal $750,000 Investment Capacity to dispose of 300 m3 of fluid per day New completion flowback 1500 - 2500 m3 per well.