H2O Midstream LLC.

BVM: What do you mean by‘traditional midstream’? Summers: “We refer to it as traditional midstream because it’s the way oil and gas has traditionally been managed–by pipeline.That became well established in the 1940s and ‘50s.The water sector has been handled entirely different. It’s been treated as a waste; it’s been trucked; it’s been the lowest concern.Over the last five years, the fundamentals of water have changed such that it looks more like oil and gas in terms of the volume you have to move and its critical nature to business operations. Our vision was to apply traditional learnings from the oil and gas side to the way water is managed. That, itself, is innovative.” Bull: “In some ways,we think we’ve done this before.We’re just applying it in a new and unique way to an emerging sector - treating water as a commodity, not a waste. Similar to the way natural gas molecules are delivered in a fee-based trans- portation agreement,we take a producer’s water from their well and redeliver an equivalent amount of water somewhere else and we charge a nominal fee.Those are innovative things that nobody’s done before with water.” BVM: What do your operations entail? Summers: “Our initial operation is in Howard County, Texas, and we cover a good bit of that county.We acquired assets from Encana about a year and a half ago and that system spans 150 miles of pipeline. We own six facilities with seven SWDs (salt water disposal wells) on them and we’re connected to another four third-party operators that have a com- bined six SWDs behind them. “In addition,we recently completed the first third- party, truck-free produced water storage hub in the state of Texas.The reason that’s unique is, typically, producers (operators) build their own storage to use the water for hydraulic fracturing.We have an inter Total System Solutions Engineering, Design, Fabrication and, Integration Services • Production & Treating Facilities • Modular Equipment • Pump, Filtration, LACT Skids • Distributed Control & PLC Systems • Instrumentation • SCADA www.principaltechnology.com sales@principaltechnology.com | 214.239.3900