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Home My WebLink AboutCO 701 ECONSERVATION ORDER 701E Ninilchik Unit 1. September 16, 2022 Hilcorp’s Spacing Exception Application for Pearl 9 Well 2. September 28, 2022 Public Hearing Notice, Affidavit of Publication, Email list, bulk mail list 3. October 13, 2022 Don Shaw request for hearing to be held 4. October 13, 2022 Email to Hilcorp re: request for hearing 5. November 3, 2022 Hearing transcript, Hilcorp presentation, Don Shaw attachments 6. December 16, 2022 Don Shaw request for reconsideration STATE OF ALASKA ALASKA OIL AND GAS CONSERVATION COMMISSION 333 West 7th Avenue Anchorage, Alaska 99501 Re: THE APPLICATION OF Hilcorp Alaska, LLC for a spacing exception to revise CO 701D allowing Hilcorp to complete, test, and produce Pearl 9 well in the Pearl Undefined Gas Pool within 1,500 feet of a property line where the owners and landowners are not the same on both sides of the line and in the Ninilchik Beluga/Tyonek Gas Pool within 1,500 feet from the exterior boundary of the Affected Area of Conservation Order 701C, pursuant to 20 AAC 25.055 and Rule 3 of CO701C. ) ) ) ) ) ) ) ) ) ) ) Docket Number: CO-22-012 Conservation Order 701E Pearl 9 Exploration Well Pearl Prospect near Ninilchik, AK Kenai Peninsula Borough, Alaska November 16, 2022 IT APPEARING THAT: 1. By letter dated September 16, 2022, Hilcorp Alaska, LLC (Hilcorp) submitted an application for revision to the Alaska Oil and Gas Conservation Commission (AOGCC) to revise CO 701D to allow the Pearl 9 well to be completed, tested, and produced in the Pearl Undefined Gas Pool and Ninilchik Beluga/Tyonek Gas Pool within 1,500 feet of a property line where the owners and landowners are not the same on both sides of the line and within 1,500 feet from the exterior boundary of the Affected Area of Conservation Order 701C, Cook Inlet Basin, Kenai Peninsula Borough, Alaska. 2. Pursuant to 20 AAC 25.540, the AOGCC tentatively scheduled a public hearing for November 3, 2022. On September 29, 2022, the AOGCC published notice of the opportunity for that hearing on the State of Alaska’s Online Public Notice website and on the AOGCC’s website, electronically transmitted the notice to all persons on the AOGCC’s email distribution list and mailed printed copies of the notice to all persons on the AOGCC’s mailing distribution list. On October 2, 2022, the AOGCC published the notice in the Anchorage Daily News. 3. Hilcorp sent, by certified mail, notice of the application to all owners, landowners, and operators of all properties within 3,000 feet of the entire Pearl 9 well path and provided the notice, addresses to which the notices were delivered, and certified mail receipts to AOGCC. 4. One request for a public hearing was received from landowner Don Shaw. For this reason, the tentatively scheduled public hearing was held at 10:00 a.m.on November 3, 2022. Mr. Shaw and two other Ninilchik landowners (McKibben Jackinsky and Patricia Waggoner provided oral testimony by phone at the hearing. Only McKibben Jackinsky was a landowner of record notified for the Pearl 9 well path revision. All three members of the public expressed concerns regarding the noise level and congestion around the Hilcorp Pearl gas development pad associated with a 24-hour drilling operation. Unfortunately, these concerns lie outside of the jurisdiction of AOGCC. CO 701E November 16, 2022 Page 2 of 4 5. Hilcorp’s original application for revision, along with its presentation at the hearing, provided sufficient information upon which to make an informed decision on its request. PURPOSE AND NEED FOR THIS ORDER: Well spacing regulations protect the oil and gas rights of adjacent landowners and maximize resource recovery by establishing default limits on how close, under the land's surface, oil and gas wells can be to each other and to property lines where ownership changes hands. These limits are set forth in a regulation, 20 AAC 25.055. Operators must abide by the default well spacing limits (referred to as statewide spacing requirements) unless they apply for, and obtain, an exception to those limits. Although exceptions to the default well spacing requirements are not unusual, AOGCC carefully evaluates each application, and typically grants them only when actual geologic conditions demonstrate that the proposed subsurface location of a well is necessary to reach otherwise unreachable oil or gas and that both the rights of adjacent landowners and underground drinking water can be protected. As a general matter, AOGCC does not have extensive authority over surface impacts such as noise, emissions, or construction. FINDINGS: 1. Hilcorp is operator for the proposed offshore targeted Pearl 9 exploration well located within Kenai Peninsula Borough, on the east side of the Cook Inlet Basin near Ninilchik, Alaska: Surface Location: Non-Unit Tract 243 (100% Private Ownership) Section 23, T01S, R14W, S.M. 402’ FNL, 791’ FEL (100% Hilcorp Working Interest (WI)) Well Path & TPH: Non-Unit Tracts 243 & 375 (100% Private); Unit Tract 008 (100% State) Sections 14 & 23, T01S, R14W, S.M. (100% Hilcorp WI) Top of Productive Horizon (1,500’ MD) Non-Unit Tract 243 270’ FNL, 907’ FEL Section 23, T01S, R14W, S.M. Bottom-hole Location: Ninilchik Unit Tract 008 (100% State – ADL0384372) 100% Hilcorp WI 2456’ FSL, 2289’ FEL Section 14, T01S, R14W, S.M. 2. Hilcorp owns 100% Working Interest (WI) in the affected oil and gas leases and is currently the operator of Ninilchik Unit. The State of Alaska owns 100% of the mineral interest in the affected lands located offshore in ADL 3384372 where the revised Pearl 9 well path is being drilled. The remaining tracts are 100% privately owned subsurface. Hilcorp provided the tract ownership schedule for the affected tracts, which details tract ownership within 3,000’ of the Pearl 9 well. 3. On August 10, 2022, AOGCC issued CO 701D granting Hilcorp a spacing exception to drill, complete, test and produce Pearl 8 & 9 exploration wells as requested, after the CO 701E November 16, 2022 Page 3 of 4 scheduled hearing was vacated. All landowners within 3,000’ of both original well paths were notified at that time. 4. After reviewing the results from the three wells targeting the Pearl structure, Hilcorp made significant changes to the well plan for Pearl 9 to get higher on the structure, by moving the well path further to the west and offshore. Additional landowners within 3,000’ from the new well path needed to be contacted due to this revision. 5. Following completion of Pearl 9 well and prior to bringing the well online, Hilcorp proposes to apply to the Department of Natural Resources (DNR) to form a Unit and Initial Participating Area (PA). Hilcorp further proposes that production be allocated in accordance with DNR’s Unit and PA decision, that production only commence when a state-approved PA is in place, and that a copy of the State decision and PA allocation schedule will be provided to AOGCC prior to commencement of production. 6. Hilcorp proposes to allocate royalties to all leased owners/landowners based on their tract allocation percentages, mineral ownership, and lease royalty shown on the approved PA allocation schedule. Hilcorp will establish and maintain, without costs to the non-participating owners/landowners, a single, interest-bearing escrow account for the non-participation owners/landowners, and will provide documentation to AOGCC that the Escrow Account has been established (see more details in Hilcorp’s June 27, 2022 Application for Spacing Exception). 7. The estimated top of Pearl Undefined Pool is 1,500’ MD. The actual TPH could easily vary from the drilling prognosis, anywhere between 1,500’ to ~9000’ MD (BHL). 8. Pearl 9 targets unproven reserves in the Beluga and Tyonek formations within the Pearl Undefined Gas Pool and within the Ninilchik Beluga/Tyonek Pool. These drilling objectives cannot be reached by conforming to applicable statewide spacing regulations because of the narrow, discontinuous, and lenticular nature of the reservoir sands and their most prospective locations on the subsurface structure. 9. If operated as required, drilling, testing, completion, and regular production of the Pearl 9 well will not cause waste or result in an increased risk of fluid movement into freshwater. CONCLUSIONS: 1. An exception to the well spacing provisions of 20 AAC 25.055 is necessary to allow drilling, completion, testing and regular production of the Pearl Undefined Gas Pool and Ninilchik Beluga/Tyonek Gas Pool in the Pearl 9explorationgas well,in order to maximize ultimate resource recovery. 2. Granting an exception to the well spacing provisions of 20 AAC 25.055 for Pearl 9 will not result in waste or jeopardize correlative rights of adjoining or nearby owners, is based on sound engineering and geoscience principles, and will not result in an increased risk of fluid movement into freshwater. 3. No production may occur absent AOGCC approval of allocation of production. In addition, Hilcorp will establish and maintain, without costs to the non-participating owners/landowners, a single, interest-bearing escrow account for the non-participation owners/landowners, and will provide documentation to AOGCC that the Escrow Account has been established. CO 701E November 16, 2022 Page 4 of 4 NOW THEREFORE IT IS ORDERED: The AOGCC grants Hilcorp’s September 16, 2022 application for an exception to the well spacing provisions of 20 AAC 25.055 to revise CO 701D allowing Hilcorp to complete, test, and produce Pearl 9 well in the Pearl Undefined Gas Pool within 1,500 feet of a property line where the owners and landowners are not the same on both sides of the line and in the Ninilchik Beluga/Tyonek Gas Pool within 1,500 feet from the exterior boundary of the Affected Area of Conservation Order 701C, pursuant to 20 AAC 25.055 and Rule 3 of CO 701C. Hilcorp may proceed and must comply with all applicable laws and all other legal requirements. DONE at Anchorage, Alaska and dated November 16, 2022. Jessie L. Chmielowski Gregory C. Wilson Commissioner Commissioner RECONSIDERATION AND APPEAL NOTICE As provided in AS 31.05.080(a), within 20 days after written notice of the entry of this order or decision, or such further time as the AOGCC grants for good cause shown, a person affected by it may file with the AOGCC an application for reconsideration of the matter determined by it. If the notice was mailed, then the period of time shall be 23 days. An application for reconsideration must set out the respect in which the order or decision is believed to be erroneous. The AOGCC shall grant or refuse the application for reconsideration in whole or in part within 10 days after it is filed. Failure to act on it within 10 days is a denial of reconsideration. If the AOGCC denies reconsideration, upon denial, this order or decision and the denial of reconsideration are FINAL and may be appealed to superior court. The appeal MUST be filed within 33 days after the date on which the AOGCC mails, OR 30 days if the AOGCC otherwise distributes, the order or decision denying reconsideration, UNLESS the denial is by inaction, in which case the appeal MUST be filed within 40 days after the date on which the application for reconsideration was filed. If the AOGCC grants an application for reconsideration, this order or decision does not become final. Rather, the order or decision on reconsideration will be the FINAL order or decision of the AOGCC, and it may be appealed to superior court. That appeal MUST be filed within 33 days after the date on which the AOGCC mails, OR 30 days if the AOGCC otherwise distributes, the order or decision on reconsideration. In computing a period of time above, the date of the event or default after which the designated period begins to run is not included in the period; the last day of the period is included, unless it falls on a weekend or state holiday, in which event the period runs until 5:00 p.m. on the next day that does not fall on a weekend or state holiday. Jessie L. Chmielowski Digitally signed by Jessie L. Chmielowski Date: 2022.11.16 10:06:05 -09'00' Gregory Wilson Digitally signed by Gregory Wilson Date: 2022.11.16 10:25:18 -09'00' Bernie Karl K&K Recycling Inc. P.O. Box 58055 Fairbanks, AK 99711 mailed 11/16/22 From:Carlisle, Samantha J (OGC) To:AOGCC_Public_Notices Subject:[AOGCC_Public_Notices] Conservation Order 701E (Pearl 9) Date:Wednesday, November 16, 2022 11:12:24 AM Attachments:CO701E.pdf Re: THE APPLICATION OF Hilcorp Alaska,LLC for a spacing exception to revise CO701D allowing Hilcorp to complete, test, and produce Pearl 9 well in the Pearl Undefined Gas Pool within 1,500 feet of a property line where the owners and landowners are not the same on both sides of the line and in the Ninilchik Beluga/Tyonek Gas Pool within 1,500 feet from the exterior boundary of the Affected Area of Conservation Order 701C, pursuant to 20 AAC 25.055 and Rule 3 of CO701C. Samantha Carlisle AOGCC Special Assistant Alaska Oil and Gas Conservation Commission 333 West 7th Avenue Anchorage, AK 99501 (907) 793-1223 __________________________________ List Name: AOGCC_Public_Notices@list.state.ak.us You subscribed as: samantha.carlisle@alaska.gov Unsubscribe at: https://list.state.ak.us/mailman/options/aogcc_public_notices/samantha.carlisle%40alaska.gov 6 Application for Reconsideration Docket Number: CO-22-012 Conservation Order 701E Dec. 16, 2022 Dear Commissioners, I'm writing in regards for an Application for Reconsideration from the AOGCC hearing held Nov 3, 2022 at 10am. While I, and others attended telephonic, things started out pretty normal for a hearing that lasted a full 6 minutes and 53 seconds! Hilcorp's Cody Terrell did mention “we're not sure exactly why this hearing was requested.” When the public was given the chance to testify, in the 45 seconds trying to un- mute my phone as the system was set up I heard “this hearing is now adjourned”. During that 45 seconds I could hear Commissioner Chmielowski asking if any one wanted to make a comment. No directions on how to connect to the 4 people that were on the line. She ask someone, [do I hear a smirk in her voice or is it just me] presumably in charge of the phone system I imagine, if anyone was coming thru on the chat or otherwise. I had requested this hearing, no one ask if there was a technical problem with the participants on the phone line, not 1 concern, just the end of the hearing. This hearing was not administered as professionally as I would expect from Commissioner Chmielowski and Commissioner Wilson based on their esteem. After that brief hearing I was in shock having my civil right to testify at an official hearing denied so blatantly. I found the number to Samantha Carlisle at AOGCC and voiced my concern. Being told the hearing was over and nothing could be done I was more adamant about my rights to testify being denied. I now was told by the end of business another hearing could be scheduled. I explained others planned their day to be there, not just me. Somewhere around 10:15am Ms Carlisle called to inform me a new hearing will convene at 11am. Now there was a hurried rush to try to get the other By Samantha Carlisle at 6:58 am, Dec 07, 2022 participants the news of the 11am hearing. Thankfully everyone made it to the new hearing. For the readers to fully understand, attached is a copy of the voice recording and a copy of the transcript. To just read the hearing transcript everything seems fine. To hear the voice recording I'm of the impression it was a sham hearing aimed at shutting me up in my continued battle for my mineral rights in this Ninilchik Unit CO 701, A, B, C, D and now E. Connect to the AOGCC homepage, go DATA, go ORDERS, go CO, search 701C. 335 pages, newest to oldest I think it is. Now that we have a new hearing 3 members of the public finally get to make comments. Patricia Waggoner, McKibbin Jackinski and myself. In the failed 1st hearing Mr. Terrell mentioned “we're not sure exactly why this hearing was requested.” Ms. Waggoner has a good answer for that, “Unfortunately under state regulations the actual drilling of the wells, this is the -- the spacing is one of the only opportunities for the public to comment.” “So this is our opportunity to comment and so I'm just adamantly against well spacing and any further drilling. I recently provided comments in regards to the well blowout regulation requesting that AOGCC consider all of us adjacent residents to these pads.” Ms. Jackinski has a very real life or death concern, “Because this is one of the few opportunities if not the only opportunity we have for making public comments, I'm -- I appreciate the opportunity and am frustrated by when I've made comments in the past hearing that well, this agency doesn't have any oversight on this particular issue or that particular issue and just having my concerns so diffused down by not knowing who to speak to that to have a chance to say something publicly is great and I'm very, very thankful for that. I am concerned about the safety of the Pearl pad that's so close to my cabin and the land where my family has lived, now I'm the third generation, my grandchildren are the fifth.” Further down in her comment, “when this was happening on the North Slope and when it happens on the North Slope there isn't a neighborhood like there is where we are. There's still the environmental issues, but there are no people considered living close to the pad like there are now. Should something happen on the Pearl pad I share a driveway with Hilcorp, I would have no way to get out other than through the one driveway we all share. That's a concern.” In my comment you'll notice I make no bones about it. I've been in this CO 701 series for 8 years or so now. Just like the others, a spacing exception hearing is the only time the public has a chance to say anything. The Sept 16, 2022 Revision to Spacing Exception CO 701D got my interest. It's the Affected Area of CO 701C that caught my eye [it's at the bottom of 1st page]. Your ruling in this 701E is wrong when you only said “All three members of the public expressed concerns regarding the noise level and congestion around the Hilcorp Pearl gas development pad associated with a 24-hour drilling operation.” There were 3 comments with concerns of safety, of blowouts, of threat to innocent lives from the industrialization of a volatile substance in an earthquake zone. As I said Nov. 3rd and I say it now. Should there ever be a catastrophic event that would harm or kill Ms. Jackinski, her family, friends or anyone else, YOU, the commissioners, should be tried for murder. Your not working in the wilderness, your under our feet! Should any of the readers who have made it this far. If you have the ability or interest drive to Windsong Ct in Ninilchik and you'll see the concern. While your driving looking at Hilcorp pads, the Bartolowits Pad is a big one. It's by Jellyfish, about 100 feet south on the west side, in Clam Gulch. Built for 6 wells, the Frances 1 sits all alone and shut down. I would like to also let you, the readers know, I'm involved in an appeal with the DNR side of things. Appeal 17-004. It was estimated to take 2 months for a ruling and we're 7 months and counting as we wait. Attached you'll find my geological report that both the DNR and the AOGCC has. And now you. Commissioners, you rule for the escrow account. Your going beyond your bounds forcing anyone to have cost taken or forcing us to sign. I must get this filed before the deadline or there would be more. Thank you, Don Shaw Clam Gulch . This is not the what's ours is ours and what's yours is negotiable wither you like it or not doctrine. This is the core value of our American system and the rights that are guaranteed within it. The rights of my minerals are not for the state to force me to sign a lease to supposedly get money for what is rightfully mine to begin with. AOGCC does not have the backing to ensure any type of commitment to the unit is in my favor especially from a company who welshed on their willingly signed contracts responsibility in Louisiana before coming to Alaska. There is no protection of cost they can bill. Of all the patent fee holders who have signed a Hilcorp lease in the Ninilchik Unit, I'm not seeing new cars and new trucks on the road in my area. As I've well documented in my past statements, David Duffy once told me, “once our bore penetrates your sub surface then we owe you money”. A few minutes later he called me back and realized I hadn't signed a lease , “maybe we can go on a fishing charter and you can sign the lease, maybe we can go on a deer hunting charter and you can sign the lease.” “I e-mailed a lease and my boss is snail mailing a lease to you right now for you to sign.” CO 701C covers this. There's so much corruption here Alaska has it's own Wikipedia page. Alaska political corruption probe. Look it up because I think it's long past time to investigate again. Public Intergrity Section, U.S. Department of Justice, Federal Bureau of Investigation, Internal Revenue Service I hope will be interested. The State of Alaska's Constitution mirrors us many sections as America's Constitution. Article 1 Declaration of Rights. § 1. Inherent Rights This constitution is dedicated to the principles that all persons have a natural right to life, liberty, the pursuit of happiness, and the enjoyment of the rewards of their own industry; that all persons are equal and entitled to equal rights, opportunities, and protection under the law; and that all persons have corresponding obligations to the people and to the State. § 2. Source of Government All political power is inherent in the people. All government originates with the people, is founded upon their will only, and is instituted solely for the good of the people as a whole. § 7. Due Process No person shall be deprived of life, liberty, or property, without due process of law. The right of all persons to fair and just treatment in the course of legislative and executive investigations shall not be infringed. 5 AOGCC 11/3/2022 ITMO: HILCORP ALASKA Docket No. CO 22-12 329 F Street, Ste. 222., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net Computer Matrix, LLC Phone: 907-227-5312 ALASKA OIL AND GAS CONSERVATION COMMISSION In the Matter of Hilcorp Alaska, LLC's ) Request to Revise Conservation Order ) 701D on a Spacing Exception for the ) Pearl 9 Well. ) __________________________________________) Docket number: CO 22-012 PUBLIC HEARING November 3, 2022 Anchorage, Alaska 10:00 o'clock a.m. BEFORE: Jessie Chmielowski, Commissioner Greg Wilson, Commissioner AOGCC 11/3/2022 ITMO: HILCORP ALASKA Docket No. CO 22-12 329 F Street, Ste. 222., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net Computer Matrix, LLC Phone: 907-227-5312 Page 2 1 TABLE OF CONTENTS 2 Opening remarks by Commissioner Chmielowski 03 3 Comments by Mr. Terrell 05 4 Comments by Mr. Shaw 11 5 Comments by Ms. Waggoner 19 6 Comments by Ms. Jakinski 21 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 AOGCC 11/3/2022 ITMO: HILCORP ALASKA Docket No. CO 22-12 329 F Street, Ste. 222., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net Computer Matrix, LLC Phone: 907-227-5312 Page 3 1 P R O C E E D I N G S 2 (On record - 10:00 a.m.) 3 COMMISSIONER CHMIELOWSKI: It is approximately 4 10:00 a.m. on Thursday, November 3rd, 2022. I am 5 Commissioner Jessie Chmielowski and with me is 6 Commissioner Greg Wilson. This is a public hearing on 7 docket number CO-22-012 to consider Hilcorp Alaska, 8 LLC's request that the Alaska Oil and Gas Conservation 9 Commission revise conservation order 701D on a spacing 10 exception for the Pearl 9 well. Conservation order 11 701D was issued on August 10, 2022 for the Pearl 8 and 12 9 exploration wells. Copies of conservation orders 13 related to this matter are available on the AOGCC 14 website. 15 Today's hearing is being held in person and via 16 Microsoft Teams. The in person location is the Alaska 17 Oil and Gas Conservation Commission Office at 333 West 18 7th Avenue, Anchorage, Alaska. Please be mindful of 19 any background noise and make sure you are muted when 20 you are not testifying or addressing the Commission. 21 If you require any special accommodation please 22 contact Samantha Carlisle. She can be reached at 907- 23 793-1223 or send her a message through the Microsoft 24 Teams chat icon and she will do her best to accommodate 25 you. AOGCC 11/3/2022 ITMO: HILCORP ALASKA Docket No. CO 22-12 329 F Street, Ste. 222., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net Computer Matrix, LLC Phone: 907-227-5312 Page 4 1 Computer Matrix will be transcribing the 2 hearing. Upon completion and preparation of the 3 transcript persons desiring a copy will be able to 4 obtain it by contacting Computer Matrix. 5 This hearing is being held in accordance with 6 Alaska statute 44.62 and 20 AAC 25.540 of the Alaska 7 Administrative Code. 8 The notice of the hearing was published on the 9 state of Alaska online notices website as well as the 10 AOGCC's website and was sent through the AOGCC email 11 list serve on September 29th, 2022. The AOGCC also 12 published the notice in the Anchorage Daily News on 13 October 2nd, 2022. 14 A request to hold this hearing was received 15 from a member of the public, Mr. Don Shaw, on October 16 13th, 2022. 17 Before asking Hilcorp to provide their 18 presentation, Commissioner Wilson, do you have any 19 questions? 20 COMMISSIONER WILSON: Nothing further from me. 21 Thanks. 22 COMMISSIONER CHMIELOWSKI: Thanks. The 23 Commissioners will ask questions during testimony. We 24 may also take a recess to consult with Staff to 25 determine whether additional information or clarifying AOGCC 11/3/2022 ITMO: HILCORP ALASKA Docket No. CO 22-12 329 F Street, Ste. 222., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net Computer Matrix, LLC Phone: 907-227-5312 Page 5 1 questions are necessary. 2 So representatives from Hilcorp, are you ready 3 to make your presentation. 4 MR. SIKS: Yes. 5 COMMISSIONER CHMIELOWSKI: Great. Thank you. 6 Please speak into the microphone and make sure the 7 bright green dot is lit. And please state your names 8 clearly for the record and begin. 9 MR. SIKS: My name is Ben Siks, I'm a geologist 10 with Hilcorp. 11 MR. TERRELL: My name's Cody Terrell, I'm the 12 landman for Hilcorp. 13 So we -- we're not sure exactly why the hearing 14 was requested so we didn't really have anything to 15 address in particular for Mr. Shaw but we can kind of 16 go over just in general what we're asking for in our 17 application and kind of just open it up for questions. 18 You know, we can go ahead and go to the next slide. 19 This is the slide number 2. This is just an 20 overview of the Ninilchik field and then showing where 21 our Pearl 9 well is. It's located just to the very 22 southern part of the Ninilchik field. If you want to 23 go to the next slide it'll kind of show what we 24 originally..... 25 So this is our original well location for Pearl AOGCC 11/3/2022 ITMO: HILCORP ALASKA Docket No. CO 22-12 329 F Street, Ste. 222., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net Computer Matrix, LLC Phone: 907-227-5312 Page 6 1 9 when we submitted our spacing exception on 6/27/2022. 2 The well was within 1,500 feet of a property boundary 3 where ownership is different and we sent notice out to 4 all the landowners within 3,000 feet of the well. And 5 after we drilled the Pearl 8 well the plans for our 6 Pearl 9 well were reevaluated and we ended up changing 7 our well location which is why we submitted the request 8 to revise it. If there's question about, you know, 9 maybe some -- why it was revised then we can maybe go 10 into that if you have questions after we go over this. 11 But next slide will show our new well location, 12 we moved it to the west and its bottomhole now offshore 13 on a state lease. We submitted our request on 14 9/16/2022 and like I said before the drilling results 15 from Pearl 8 really drove our revised well location, 16 that's why we changed it and but we're still within 17 1,500 feet of a property line where ownership has 18 changed. And as we move from the bottomhole location 19 to the surface hole location we start to get into that 20 area where there are not defined pool rules which falls 21 under the statewide spacing rules and so that's why we 22 submitted our revision, we understood we need a spacing 23 exception for the revised well location. The wells 24 targeting Beluga/Tyonek gas sands and the production 25 right now from the well, there's no production online AOGCC 11/3/2022 ITMO: HILCORP ALASKA Docket No. CO 22-12 329 F Street, Ste. 222., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net Computer Matrix, LLC Phone: 907-227-5312 Page 7 1 at the moment, but it's pending DNR decision for the 2 Pearl PIN, then production will then be allocated to 3 the Pearl PA pending DNR decision once it gets brought 4 online. 5 Ownership within that drainage area is various 6 private lands and state of Alaska lands. And all the 7 owners within 3,000 feet were sent notice as required 8 under regulation. 9 I think..... 10 COMMISSIONER CHMIELOWSKI: Thank you. So you 11 mentioned the Pearl PA, is that evaluation with the DNR 12 right now, I mean, that application? 13 MR. TERRELL: Yes, ma'am. 14 COMMISSIONER CHMIELOWSKI: Yeah. And will the 15 Ninilchik unit then be expanded to include Pearl PA? 16 MR. TERRELL: There was also a unit expansion 17 request as well. 18 COMMISSIONER CHMIELOWSKI: Okay. 19 MR. TERRELL: And our plan is just -- is to 20 also expand the pool rules, but we're kind of waiting 21 on confirmation from DNR because we want it to match 22 the pool boundaries or the unit boundaries. 23 And that's all I have. That's kind of just a 24 general overview of what we're asking. We can open it 25 up for questions for whoever at this point. That's AOGCC 11/3/2022 ITMO: HILCORP ALASKA Docket No. CO 22-12 329 F Street, Ste. 222., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net Computer Matrix, LLC Phone: 907-227-5312 Page 8 1 really all we had, we don't have any new information 2 that's not in the application already..... 3 COMMISSIONER CHMIELOWSKI: Okay. 4 MR. TERRELL: .....as presented. So..... 5 COMMISSIONER CHMIELOWSKI: I just had a quick 6 question. Reviewing the conservation order 701D that 7 was issued already, there's mention of creating an 8 escrow account, but also mentions that regular 9 production will not begin until the PA is approved. So 10 are you doing both of those items, creating an escrow 11 account and waiting for regular production? 12 MR. TERRELL: So the requirement in the current 13 pool rules for Ninilchik field require an escrow 14 account for any unleased lands within a participating 15 area. 16 COMMISSIONER CHMIELOWSKI: Uh-huh. 17 MR. TERRELL: And in this case there will be 18 some, initially some unleased lands within the Pearl 19 PA. So we're kind of both, so we're going to form the 20 Pearl PA and establish an escrow account for those 21 unleased landowners..... 22 COMMISSIONER CHMIELOWSKI: Okay. 23 MR. TERRELL: .....as required under the..... 24 COMMISSIONER CHMIELOWSKI: Thank you. 25 MR. TERRELL: .....pool rules. AOGCC 11/3/2022 ITMO: HILCORP ALASKA Docket No. CO 22-12 329 F Street, Ste. 222., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net Computer Matrix, LLC Phone: 907-227-5312 Page 9 1 COMMISSIONER CHMIELOWSKI: No further questions 2 from me. Commissioner Wilson, do you have questions 3 before we go to the public? 4 COMMISSIONER WILSON: Nothing further from me. 5 COMMISSIONER CHMIELOWSKI: All right. So I 6 would like to offer any member of the public the 7 opportunity to testify or provide comments. No written 8 comments were received on this matter. Is there 9 anybody on the phone or on Teams who would like to 10 provide comments? 11 (No comments) 12 COMMISSIONER CHMIELOWSKI: Is there anything 13 coming through, Sam, on the chat or otherwise? 14 MS. CARLISLE: There's nothing. 15 COMMISSIONER CHMIELOWSKI: Well, the record 16 will be open until 4:30 this afternoon for anyone who 17 wishes to provide comments. 18 I have nothing further and there's no other 19 comments. Commissioner Wilson, anything else from you. 20 COMMISSIONER WILSON: Nothing further from me. 21 COMMISSIONER CHMIELOWSKI: All right. Thank 22 you. So hearing no other business the time is 10:08 23 a.m. and this hearing is now adjourned 24 (Off record - 10:08 a.m.) 25 (On record) AOGCC 11/3/2022 ITMO: HILCORP ALASKA Docket No. CO 22-12 329 F Street, Ste. 222., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net Computer Matrix, LLC Phone: 907-227-5312 Page 10 1 COMMISSIONER CHMIELOWSKI: .....well. 2 Conservation order 701D was issued on August 10th, 2022 3 for the Pearl 8 and 9 exploration wells. Copies of 4 conservation orders related to this matter are 5 available on the AOGCC website. This hearing was first 6 convened at 10:00 a.m. this morning. At the time of 7 that hearing opportunity was given for public comment 8 however due to technical difficulties a member of the 9 public was not given the opportunity to testify on the 10 record. I apologize to Mr. Don Shaw for this issue and 11 we will make some corrections to our process to avoid 12 it in the future. 13 I would like to just check whether 14 representatives from Hilcorp are on the line. Please 15 -- if so, please state your names. 16 (No comments) 17 COMMISSIONER CHMIELOWSKI: The way to unmute 18 yourself if needed is pound -- is star, six. Is anyone 19 from Hilcorp on Teams. 20 MS. CARLISLE: I think they're joining now. 21 COMMISSIONER CHMIELOWSKI: Okay. I think 22 they're joining now so we'll just give a minute. 23 So we will -- we are reconvening this hearing 24 to offer any member of the public the opportunity to 25 testify or provide comments. No written comments were AOGCC 11/3/2022 ITMO: HILCORP ALASKA Docket No. CO 22-12 329 F Street, Ste. 222., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net Computer Matrix, LLC Phone: 907-227-5312 Page 11 1 received on this matter. Mr. Don Shaw has indicated 2 that he wishes to provide comment. Just for general 3 information on Teams the code to unmute your phone is 4 star, six. If anyone has technical difficulties 5 Samantha Carlisle can be reached at 907-793-1223 or you 6 can call the AOGCC main number at 907-279-1433. And at 7 the appropriate time we will pause for 60 seconds to 8 allow people to unmute themselves if needed. 9 I believe Hilcorp is on the line. I just want 10 to double check, Hilcorp is anyone on the line. 11 MR. TERRELL: Yes, this is Cody Terrell. Ben 12 Siks was not able to join, but I'm on the line. 13 COMMISSIONER CHMIELOWSKI: Great. So, Mr. 14 Shaw, are you on the line and would you like to take 15 this opportunity to provide comments? 16 MR. SHAW: Yes, I am, Commissioner, and yes, I 17 would. 18 COMMISSIONER CHMIELOWSKI: Please proceed. 19 MR. SHAW: All right. Well, first I'd like to 20 say I see we have new Commissioners in the AOGCC. I'd 21 like to thank you. I would also like to thank you for 22 reconvening this so I can testify. And I truly hope 23 for integrity in our state. 24 The first thing I want to really clear up, 25 first and foremost I'd like to clear up any AOGCC 11/3/2022 ITMO: HILCORP ALASKA Docket No. CO 22-12 329 F Street, Ste. 222., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net Computer Matrix, LLC Phone: 907-227-5312 Page 12 1 misconception about the spacing exception that the past 2 Commissioners have made in 701C. I've been well aware 3 for quite sometime that being within 3,000 foot radius 4 of the spacing exception does not mean I'm 5 automatically to be entitled royalties. It does 6 however inform me that something is taking place within 7 3,000 feet of me. Nowhere do I recall seeing the word 8 notification on my spacing exception packet. So for 9 them to rule notification is just that and nothing 10 more, does not imply or establish a 3,000 foot drainage 11 radius for the Francis 1 well. 12 So put the word notification on my spacing 13 exception packet and then they would have been valid on 14 that ruling. 15 My experience in 45 years up here with the oil 16 industry, being an Exxon Valdez oil spill litigant, I 17 used to believe in the oil industry and how they -- how 18 the state and everything was for the state and for the 19 people until Tony Knowles was elected governor. When 20 he was first elected governor he got on a jet, he flew 21 to Texas because Alaska's soil was not good enough for 22 him to stand on being sworn in as governor of Alaska. 23 So I've seen in my times being in the AOGCC 24 office where before hearing Hilcorp freely gets to walk 25 back into the office, they come out and attend the -- AOGCC 11/3/2022 ITMO: HILCORP ALASKA Docket No. CO 22-12 329 F Street, Ste. 222., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net Computer Matrix, LLC Phone: 907-227-5312 Page 13 1 they attend the hearing and freely get back to walk 2 back in. I truly believe there is corruption in this 3 state. And I think what they do is they go for the 4 highest levels because you're the ones who make the 5 decisions. 6 In August of 2016 there's a -- the meter 7 violation over the Francis 1 well on the Bartholowoods 8 pad, they don't even know how much they stole. And in 9 that violation in your records they've got a long 10 history of noncompliance. At the point AOGCC made a 11 unprecedented drive to Kenai to show them how to do 12 things and I think that the oil company, I think 13 Hilcorp, is still laughing at that. 14 Now Hilcorp came from Louisiana, they started 15 from Exxon, Greg Hildebrandt, he started Hilcorp, he 16 went to Louisiana and he bought out all the little 17 companies there, the lease contract he had was -- it 18 was his duty, his responsibility to cleanup the mess 19 that all those other people had done. And what he did 20 is he made a billion dollars and he moved up to Alaska 21 and back then in 2015, '16, before they came up here 22 and I think still to this day are trying to change the 23 Louisiana constitution to shirk their responsibilities 24 on a lease. 25 So we've got the escrow account and the escrow AOGCC 11/3/2022 ITMO: HILCORP ALASKA Docket No. CO 22-12 329 F Street, Ste. 222., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net Computer Matrix, LLC Phone: 907-227-5312 Page 14 1 account that Hilcorp's proposing right now affects 701C 2 which I had greatly testified in. It's basically state 3 sponsored blackmail. If you allow this escrow account 4 to go through there's no -- the state doesn't have any 5 power to negotiate the lease. So now people are told 6 that they've got money, but they don't get it until 7 they sign the lease, they commit to the unit. But the 8 lease isn't set up for the people and if you allow this 9 it's blackmail because when people finally breakdown 10 and sign the lease, the lease pretty much -- you don't 11 get any money anyway. So if you're going to do 12 anything about people who are not committed to the unit 13 is force the royalty. There's no law anywhere in 14 America that says I have to sign a lease. Now I'm 15 currently involved in the appeal with the DNR to repeal 16 17004 and Hilcorp mentioned it in their DNR delay of 17 contraction. They're still waiting on a ruling on 18 that. I've submitted by geological report and that, 19 I'm not within the nice, pretty boundary lines, but I 20 am within the producing area. 21 So to allow this escrow to go through, that 22 would force me to sign a lease that I can't trust 23 Hilcorp. They left Louisiana, they shirked their 24 responsibility over a lease and now it's a matter of 25 I've got to hire a lawyer to fight for what's mine, AOGCC 11/3/2022 ITMO: HILCORP ALASKA Docket No. CO 22-12 329 F Street, Ste. 222., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net Computer Matrix, LLC Phone: 907-227-5312 Page 15 1 that's if you allow it. If you allow it it's 2 blackmail. 3 So forced royalties for people -- not all of us 4 are in love with the oil industry. You've got the 5 Francis 1 pad or the Bartholowoods pad where the 6 Francis 1 well was built, they -- back then they were 7 going to have the Francis 2 and the Francis 3 and the 8 concrete pads are there to put those wells in. But 9 then I started testifying back there. Francis 1 was 10 one of the greatest gas wells the state's seen in a 11 long, long time. Everybody's excited about having 12 Francis 2 and Francis 3, the pad was big enough to put 13 Francis 4, 5 and 6 on. 14 Currently Francis 1 has not produced anything 15 in around 17 months. Instead you've moved down to -- 16 you've moved down to the Furrow pad. And now down at 17 the Furrow pad I've seen Makivin Jakinski's home that 18 is truly 50 feet, 60 feet away from the pad. You've 19 industrialized the neighborhood. If there was a crisis 20 on that pad, if something happened, truly Makivin and 21 her family could be killed. And if that pad is allowed 22 to continue I think you, the Commissioners, who could 23 put a stop to this should be charged with murder. 24 There's no sense in letting this company move literally 25 right onto people's front doorsteps. AOGCC 11/3/2022 ITMO: HILCORP ALASKA Docket No. CO 22-12 329 F Street, Ste. 222., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net Computer Matrix, LLC Phone: 907-227-5312 Page 16 1 You've got the Bartholowoods pads that's away 2 from everybody, it was already planned for six wells, 3 they were excited about it, now they've got this escrow 4 issue, they have this appeal issue, they're trying to 5 move down the coast and our state has got to do 6 something to keep them out of our neighborhoods, keep 7 them away from the kids' swingsets. This is 8 industrialization and should be done in a far off 9 place. 10 On the North Slope we couldn't do anything 11 about it. In the Ninilchik unit there's so many 12 homestead lands, (indiscernible - distortion) owners 13 and you're just letting these people just bulldoze 14 their way right in. So that's something is concern. 15 And I think truly what should be done on the Furrow pad 16 is you should rip it out by the roots and return it to 17 where it -- what it was. And if you -- if you're going 18 to do something unprecedented then I'd say make an 19 unprecedented drive down to the Furrow pad and look at 20 where MaKivin's house is, 50 feet from the pad, and 21 apparently they want -- they want three acres of her 22 land so they can enlarge it even closer. So you're 23 just -- you got to rip it out. You got the 24 Bartholowoods pad, it hasn't done anything in several 25 years. AOGCC 11/3/2022 ITMO: HILCORP ALASKA Docket No. CO 22-12 329 F Street, Ste. 222., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net Computer Matrix, LLC Phone: 907-227-5312 Page 17 1 Everybody's out to sign leases, sign leases, 2 there's no law in America that says we have to sign 3 leases. 4 Being a litigant in the Exxon Valdez oil spill 5 I mention this and I'm going to send this in after we 6 finish with this hearing, I've got a couple of files to 7 send with my testimony. Being a litigant from the 8 Exxon Valdez oil spill I am fully aware of my state 9 government's cold, deaf ears. This hearing only shows 10 a new low that I didn't -- truly didn't think 11 attainable. That was my reply to the ruling of 701C. 12 Hilcorp and 701D want to change the escrow 13 account, no. No. It's within the realm of the AOGCC 14 and you can see that Cathy Foerster said that in CO 15 701, right at the very beginning in there. They forced 16 royalties before, they'll do it again and I'm hoping 17 that the new Commissioners that we have now will take 18 that stand, stand up for the people. 19 So I think that's pretty much what I've got to 20 say. Oh, I've got one more thing to say and it's about 21 our state constitution. And our state constitution it 22 pretty much mirrors the U.S. government constitution 23 only one of the things in there because of our 24 independent natures, we've got a little more fierceness 25 in our constitution. Me being a commercial fisherman AOGCC 11/3/2022 ITMO: HILCORP ALASKA Docket No. CO 22-12 329 F Street, Ste. 222., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net Computer Matrix, LLC Phone: 907-227-5312 Page 18 1 I'm fiercely independent. The source of the government 2 in section II of our constitution, the source of the 3 government's political power is inherent in the people. 4 All government originates with the people, is founded 5 upon their will only and is instilled fully for the 6 good of the people has a whole. Forcing people to sign 7 contracts for money they'll never get just to be part 8 of a resource that they truly own is denying that 9 constitutional right. 10 So I think that's pretty much what I've got to 11 say. If there's anybody else on the line that wants to 12 testify, I truly hope they do, but I'm very adamant, 13 I'm in the appeals, I'm sure Hilcorp knows that, I -- 14 they've got all my files, they've got my geological 15 reports and I'm tired of the thievery, I've been stolen 16 from for years and I don't get a penny out of it. And 17 it's time to come to an end. 18 So, Commission, I'm going to close my testimony 19 on this. I've got the file that I'm going to send here 20 just shortly and I'd like to thank you for the 21 opportunity to speak. 22 COMMISSIONER CHMIELOWSKI: Thank you very much, 23 Mr. Shaw. As you know the record will stay open until 24 4:30 this afternoon if there's anything you'd like to 25 provide in addition to your oral testimony. AOGCC 11/3/2022 ITMO: HILCORP ALASKA Docket No. CO 22-12 329 F Street, Ste. 222., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net Computer Matrix, LLC Phone: 907-227-5312 Page 19 1 I will open up the line. Is there any other 2 member of the public who would like to testify or 3 provide comments. 4 MS. WAGGONER: Yes, I would. 5 COMMISSIONER CHMIELOWSKI: Will you please 6 state your name and affiliation for the record. 7 MS. WAGGONER: Yes, my name is Patricia 8 Waggoner and I currently reside within one mile of both 9 the Pearl Pad, a quarter-mile of the Paxton pad and a 10 mile of the Klosa pad. 11 COMMISSIONER CHMIELOWSKI: Okay. Thank you. 12 Please provide your testimony. 13 MS. WAGGONER: And -- yeah. Unfortunately 14 under state regulations the actual drilling of the 15 wells, this is the -- the spacing is one of the only 16 opportunities for the public to comment. And I am 17 impacted by all three sites, multiple years of lost 18 sleep. The adjacent resident to Paxton and I 19 commiserate at 3:00 in the morning. So I would really 20 request that AOGCC look at not approving any wells to 21 be drilled until we can actually start looking at 22 impacts to the closest residents. We recently -- 23 neighbors and I commented in regards to an expansion of 24 the Pearl pad or the Paxton pad and were told DNR only 25 looks at the pad itself, they don't have to deal with AOGCC 11/3/2022 ITMO: HILCORP ALASKA Docket No. CO 22-12 329 F Street, Ste. 222., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net Computer Matrix, LLC Phone: 907-227-5312 Page 20 1 the drilling. 2 So this is our opportunity to comment and so 3 I'm just adamantly against well spacing and any further 4 drilling. I recently provided comments in regards to 5 the well blowout regulation requesting that AOGCC 6 consider all of us adjacent residents to these pads. 7 And that's all I have to say. Thank you. 8 COMMISSIONER CHMIELOWSKI: Thank you very much. 9 Is there anybody else on the line who would like to 10 testify or provide comments? 11 (No comments) 12 COMMISSIONER CHMIELOWSKI: So I will just 13 repeat some basic information and then we will pause. 14 On Teams the code to unmute yourself is star, six. If 15 anyone is having technical difficulties Samantha 16 Carlisle can be reached at 907-793-1223 or you can call 17 the AOGCC main number at 907-279-1433 and we will help 18 you address your issue. I will now pause for a full 60 19 seconds to allow people time to unmute or contact us 20 about providing comments. 21 MS. JAKINSKI: This is Makivin Jakinski. Have 22 I successfully unmuted myself? 23 COMMISSIONER CHMIELOWSKI: Yes, you have. 24 Would you like to provide comments. 25 MS. JAKINSKI: Yes, I would. Thank you. AOGCC 11/3/2022 ITMO: HILCORP ALASKA Docket No. CO 22-12 329 F Street, Ste. 222., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net Computer Matrix, LLC Phone: 907-227-5312 Page 21 1 COMMISSIONER CHMIELOWSKI: Okay. Please 2 state..... 3 MS. JAKINSKI: First of all I want to thank the 4 Commission..... 5 COMMISSIONER CHMIELOWSKI: Oh, go ahead. 6 MS. JAKINSKI: Oh, go ahead. 7 COMMISSIONER CHMIELOWSKI: I was going to say 8 please just restate..... 9 MS. JAKINSKI: This is Makivin. 10 COMMISSIONER CHMIELOWSKI: .....your name and 11 affiliation for the record. 12 MS. JAKINSKI: Okay. Makivin Jakinski is my 13 name and I live within a quarter mile of the Pearl pad 14 and within a mile of -- within a second pad that's just 15 to the north of me, also a Hilcorp pad. 16 I want to thank the Commission for restarting 17 this meeting. I was surprised when it -- when no one 18 spoke up earlier, but I understand that there were some 19 technical difficulties so thank you for giving us all a 20 second chance here to comment. And also thanks to Don 21 Shaw and to Trish Waggoner for making comments. 22 Because this is one of the few opportunities if 23 not the only opportunity we have for making public 24 comments, I'm -- I appreciate the opportunity and am 25 frustrated by when I've made comments in the past AOGCC 11/3/2022 ITMO: HILCORP ALASKA Docket No. CO 22-12 329 F Street, Ste. 222., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net Computer Matrix, LLC Phone: 907-227-5312 Page 22 1 hearing that well, this agency doesn't have any 2 oversight on this particular issue or that particular 3 issue and just having my concerns so diffused down by 4 not knowing who to speak to that to have a chance to 5 say something publicly is great and I'm very, very 6 thankful for that. 7 I am concerned about the safety of the Pearl 8 pad that's so close to my cabin and the land where my 9 family has lived, now I'm the third generation, my 10 grandchildren are the fifth. I've just been approached 11 for the third time from Hilcorp with a lease. Every 12 time I've refused to sign it because I don't want them 13 that close to my place, but I seem to have -- my nos 14 seem to have no impact in terms of keeping them out of 15 the neighborhood. As someone said earlier that 16 testified, I believe it was Don Shaw, when this was 17 happening on the North Slope and when it happens on the 18 North Slope there isn't a neighborhood like there is 19 where we are. There's still the environmental issues, 20 but there are no people considered living close to the 21 pad like there are now. Should something happen on the 22 Pearl pad I share a driveway with Hilcorp, I would have 23 no way to get out other than through the one driveway 24 we all share. That's a concern. 25 The disturbance that their activity has caused AOGCC 11/3/2022 ITMO: HILCORP ALASKA Docket No. CO 22-12 329 F Street, Ste. 222., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net Computer Matrix, LLC Phone: 907-227-5312 Page 23 1 already and they've not yet even started to produce has 2 been immense. The noise of the flaring that went on 3 this last summer, the noise of their activity, the 4 disturbance that causes to the neighborhood plus the 5 wildlife is immeasurable. I can't say enough about how 6 much I don't want them there. 7 So before any permission is done for them to do 8 anymore, if some state agency and hopefully it will 9 start with the Commission, would look closely at the 10 activities that's going on, it would be very 11 appreciated and take the public into account. 12 Thank you so much for this opportunity. 13 COMMISSIONER CHMIELOWSKI: Thank you for your 14 comments. Is there anybody else on the line who would 15 like to testify. 16 (No comments) 17 COMMISSIONER CHMIELOWSKI: So I will go back -- 18 we'll wait a full 60 seconds just in case anyone's 19 having trouble. Again the code to unmute Teams is 20 star, six and the two numbers to call if you need to 21 are 907-793-1223 or 907-279-1433. 22 I will pause now for 60 seconds to allow people 23 time to communicate with the AOGCC if wanted to. 24 Thanks. 25 (No comments) AOGCC 11/3/2022 ITMO: HILCORP ALASKA Docket No. CO 22-12 329 F Street, Ste. 222., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net Computer Matrix, LLC Phone: 907-227-5312 Page 24 1 COMMISSIONER CHMIELOWSKI: All right. It has 2 been 60 seconds and I haven't heard anything. 3 Samantha, have we received any calls or chat texts on 4 the Teams? 5 MS. CARLISLE: I have not. 6 COMMISSIONER CHMIELOWSKI: Okay. I appreciate 7 the comment we received today. I apologize again for 8 technical difficulties and the AOGCC will do better in 9 future hearings to ensure that members of the public 10 are given the opportunity to testify. All the 11 testimony received today is on the record and will be 12 carefully considered. 13 Is there anything you'd like to say, 14 Commissioner Wilson? 15 COMMISSIONER WILSON: No. Just to reiterate 16 that we do regret the technical difficulties today. We 17 thank you for helping us improve our meeting process 18 and we will add these additional opportunities with the 19 phone calls and the longer pause at all forthcoming 20 meetings. 21 Thank you. 22 COMMISSIONER CHMIELOWSKI: All right. Hearing 23 no other business the time is 11:27 and this hearing is 24 now adjourned. 25 Thank you. AOGCC 11/3/2022 ITMO: HILCORP ALASKA Docket No. CO 22-12 329 F Street, Ste. 222., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net Computer Matrix, LLC Phone: 907-227-5312 Page 25 1 (Hearing adjourned - 11:27 a.m.) 2 (END OF PROCEEDINGS) 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 AOGCC 11/3/2022 ITMO: HILCORP ALASKA Docket No. CO 22-12 329 F Street, Ste. 222., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net Computer Matrix, LLC Phone: 907-227-5312 Page 26 1 TRANSCRIBER'S CERTIFICATE 2 I, Salena A. Hile, hereby certify that the 3 foregoing pages numbered 02 through 26 are a true, 4 accurate, and complete transcript of proceedings in 5 Docket number: CO 22-012, transcribed under my 6 direction from a copy of an electronic sound recording 7 to the best of our knowledge and ability. 8 9 _______________ _______________________________ 10 DATE SALENA A. HILE, (Transcriber) 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Pearl 9 Spacing Exception Ben Siks (GEO) Cody Terrell (Landman) November 3, 2022 AOGCC Public Hearing 2 Ninilchik Field Pearl 9 Well 3 Pearl 9 Spacing Exception Initial Spacing Exception Request •Submitted on 6/27/2022 •Pearl 9 is within 1,500’ of property boundary where there is ownership change •Notice was mailed to all landowners within 3,000’ of wellbore. •After drilling Pearl 8 well the well plan for Pearl 9 was revised. Initial Pearl 9 BHL 4 Pearl 9 Spacing Exception (revised) Revised Pearl 9 BHL Revised Spacing Exception Request •Submitted on 9/16/2022 •Drilling results from Pearl 8 well changed well plan for Pearl 9. •Revised Pearl 9 well is within 1,500’ of property boundary where there is ownership change •Notice mailed to all landowners within 3,000’ of wellbore. •Targeting the Beluga/Tyonek gas sands. •Any production will be allocated as prescribed in the pending DNR Decision for the Pearl PA. •Ownership within anticipated drainage area: •State of Alaska •Private From:don shaw To:Carlisle, Samantha J (OGC) Subject:Nov 3 2022 hearing files to be added to my testimony CO-22-012 Date:Thursday, November 3, 2022 11:44:21 AM Attachments:Don Shaw Geologic Study(1).pdf Notice of Reconsideration CO 701c Jan 22 2018.pdf CAUTION: This email originated from outside the State of Alaska mail system. Do not click links or open attachments unless you recognize the sender and know the content is safe. Don Shaw Geologic Study Falls Creek Participating Area Ninilchik Gas Field, Alaska Submitted to: Don Shaw Physical Address: 14250 Osemore Street Tract 238, Clam Gulch, AK 99568 Mailing Address: 3640 N. Jaeger Circle Wasilla, Alaska 99654 By: Belowich Coal Consulting Michael A. Belowich M.Sc. Coal Geologist - CPG-11077 Michael Belowich, M.Sc. (CPG-11077) 1125 E. Snowhill Ave. Wasilla, Alaska 99654 907-631-0482 (home) 907-232-9538 (mobile) STATEMENT OF INDEPENDENCE & QUALIFICATIONS Michael Belowich, M.Sc. (CPG-lI077) is not, nor intends to be a director, officer or other direct employee of Mr. Don Shaw and has no material interest in the Ninilchik Gas Unit or Falls Creek PA area or exploration wells contained within or adjacent to. The relationship with Mr. Shaw is solely one of professional association between client and independent consultant. The review work and this report are prepared in return for professional fees based upon agreed commercial rates and the payment of these fees is in no way contingent on the results of this report. Author: Michael Belowich, M.Sc. (CPG-II077) Michael Belowich qualifies as a Competent Person as per 2012 Edition of JORC Code. Mr. Belowich is a Certified Professional Geologist, with a Master's degree in geology from the University of Alaska Fairbanks, with emphasis on coal science and technology. Mr. Belowich is a member of American Institute of Professional Geologists, American Association of Petroleum Geologists, Alaska Geologic Society and Alaska Miners Association. Mr. Belowich has 39 years of coal experience in Alaska, including surface and underground coal mine exploration, coal-bed methane exploration, underground coal gasification exploration, and permitting of coal related projects through Alaska's Surface Mining Control and Reclamation Act (SMCRA) and associated State and Federal regulatory agencies. Since January 1, 2016, Mr. Belowich has been an independent geological consultant starting in a commercial office space in Wasilla, Alaska, then in a home office in Kea’au, Hawaii from October 2016 to July, 2021, and then upon his move back to Alaska, from a Wasilla home office. In the last several years, he has consulted for Alaska Earth Sciences, Alaska Natural Gas Corporation, University of Alaska and McKinley Service & Equipment of Soldotna. Between 2005 and 2015, Mr. Belowich worked for Alaska Earth Sciences as a project senior geologist and has authored geologic reports and/or regulatory permits for the following coal deposits: Jonesville; Chickaloon; Wishbone Hill; Jarvis Creek; Beluga Underground Coal Gasification (UCG); Port Mackenzie CBM/UCG; Northern Dancer #1 conventional gas/CBM; Seward Peninsula Coal Deposit; and Herendeen Bay Coal Deposit. Mr. Belowich has consulted for Alaska's Division of Geological and Geophysical Surveys, Arctic Slope Consulting Group, Evergreen Resources Alaska, Forest Oil Corporation, Storm Cat Energy, Chugach Alaska Corporation, Black Range Minerals, Laurus Energy, Usibelli Coal Mine, and Cook Inlet Regional Corporation. From 2003 to 2005, Mr. Belowich was a coal geologist for Evergreen Resources overseeing exploration plans and operations for coal bed methane exploration. From 1997 to 2003, Mr. Belowich worked as an independent consultant for coal exploration in Alaska. From 1995 to 1997, Mr. Belowich worked for Nerox Power Systems as the mine geologist and regulatory compliance manager for development of the Jonesville Mine in Sutton, AK. From 1988 to 1994, Mr. Belowich worked as a consulting geologist for clients including the State of Alaska and Arctic Slope Consulting Group. Mr. Belowich worked as an intern for the Alaska Division of Geological and Geophysical Surveys from 1982 to 1988. 2 TABLE OF CONTENTS TOPIC PAGE 1.0 Summary 1 2.0 Background 1 3.0 Cook Inlet Geologic Setting 3 3.1 Structure 3 3.2 Stratigraphy 5 4.0 General Geology Ninilchik Area 9 5.0 Past Exploration in Ninilchik Area 17 6.0 Falls Creek Participating Area Discussions 18 7.0 Tyonek Formation Depositional Environments 20 8.0 Hilcorp Frances #1Wellfile Geologic Discussions 25 9.0 Hilcorp Geologist Comments in 2015 27 10.0 Correlation of Hilcorp Frances #1 and SOCAL #43-6 Wells 29 11.0 Discussions 35 12.0 Don Shaw Tract 238 Discussions 36 13.0 Conclusions 40 14.0 References 42 LIST OF FIGURES Figure 1 Cook Inlet Basin and Respective Coal Fields 4 Figure 2 Cook Inlet Basin Stratigraphic Column 6 Figure 3 Tyonek Formation Type Section 7 Figure 4 Ninilchik Unit and Anticlinal Structure 10 Figure 5 Subsea Depth Structure Map of Ninilchik Field at Top Tyonek Horizon 11 Figure 6 Interpreted Seismic Line B Depicting Northward Dipping Normal Faults 12 Figure 7 Interpreted Seismic Line A Depicting the Main Southeast-Dipping Reverse 13 Fault and Basic Anticlinal Structure at Ninilchik Figure 8 Falls Creek Participating Area Showing Past Exploration Wells 19 Figure 9 Hilcorp Frances #1 LAS File Data Between 7,480’ and 7,680’ 31 Figure 10 SOCAL 43-6 Gamma-Density Log Between 7,540’ and 7,790’ 32 LIST OF TABLES Table 1 Tyonek Formation Depositional Environments 24 Table 2 Frances #1 Gas Shows – from AOGCC well file 26 Table 3 Hilcorp Frances #1 – SOCAL #43-6 Correlatable Sands and Coal Beds 33 3 4 1.0 SUMMARY This is an independent Geological Report of the Falls Creek Participating Area (PA) within the Ninilchik Gas Field in the vicinity of Hilcorp Alaska LLC’s Frances #1 well and Don Shaw’s Tract 238 in the greater Clam Gulch area of the Kenai Peninsula. The report is a request by Mr. Don Shaw for an independent third-party geologic opinion. Impetus to complete such a study are Mr. Shaw’s continuing disagreement with Hilcorp’s proposed amendment to the Ninilchik Gas Unit’s Beluga/Tyonek Gas Pool from 2015, an expansion of their Falls Creek Participating Unit within the Ninilchik Gas unit in 2016, a refinement of the vertical and horizontal boundaries of the Ninilchik Beluga/Tyonek Gas Pool within Conservation Order 701 in 2017, a Notice of Reconsideration of CO 701 in 2018 and finally a more recent Appellant Opportunity to Supplement Record on this Reconsideration in 2021. Mr. Shaw has for many years owned a 9.55-acre parcel (Tract 238) in the Falls Creek subdivision near Clam Gulch. which lies within the 3,000 feet spacing exception to the producing Frances #1 gas well drilled in 2013 and operated by Hilcorp. Mr. Shaw also appears to have issues with the Alaska Oil & Gas Conservation Commission (AOGCC) adjudication process within the Falls Creek PA over the last several years. Furthermore, the Alaska State Department of Natural Resources and its Division of Oil and Gas has a policy that assumes that only areas within 1,500 feet of productive wellbores contain productive sand zones and thus excludes any areas outside this, or around “dry” holes (even if they were not tested), when determining Participating Area boundaries. Because of these bureaucratic issues, Mr. Shaw feels that his correlative rights are not being protected since he is adamant that he is within the 3,000-foot drainage radius of a producing gas well, Hilcorp’s Frances #1. Hilcorp has even approached Mr. Shaw in the past about signing a lease with them since he is within the 3,000-foot spacing exception. To date Mr. Shaw has not agreed to sign the above noted lease offered by Hilcorp and join with other nearby landowners in or immediately adjacent to the Falls Creek PA as royalty interest owners in the future development of the adjacent gas field. For unleased tracts, including those outside the 1,500- foot PA boundaries, but still within the 3,000-foot spacing exception, Hilcorp is offering those with unleased or uncommitted tracts a suspense account. These suspense accounts accumulate a standard royalty interest of 12 and a half percent for landowners that are released and placed into a pay status as soon as Hilcorp can reach agreement with the previous uncommitted landowner to sign a lease with them. Belowich Coal Consulting (BCC) is not party to the reasoning behind Me. Shaw’s refusal to this point of not signing a lease agreement with Hilcorp in the Falls Creek PA. It is hoped that the upon reading and understanding the findings of this independent geologic report by BCC, that Mr. Shaw can make a more informed decision on whether to continue with his appeals regarding his correlative rights regarding future as production from the nearby Frances #1 gas well and sign or not sign the lease offer from Hilcorp. 2.0 BACKGROUND There are many direct correlations between the issues Don Shaw is presently having with Hilcorp, the AOGCC and the Alaska DNR and issues that the University of Alaska’s Facility and Land Management (UAFLM) Department and another landowner in the area, Paul L. Craig (PLC, LLC), continue to have with the same entities. UAFLM owns two parcels of land (Parcels 19 and 18) that are east of the Falls Creek PA and about one mile and 1.5 miles north northeast respectively of the Shaw property. Mr. 5 Craigs land holdings in Sections 31 and 32 are just beyond UAFLM’s property to the north, that straddles a northwest to southeast bounding fault. In as much as the issues that exist between the three private landowners and the three aforementioned private and governmental organizations are somewhat interrelated, BCC feels it is pertinent that to explain some of the background details that are involved that initiated the issues. These background details were brought out in BCC’s independent geologic report to the University of Alaska in 2018. The below details were taken from the 2018 UAFLM report. The impetus to complete the 2018 UAFLM study was the recent exclusion by the Alaska Department of Natural Resources (DNR) of the University of Alaska’s parcel (Track) 19 from the Falls Creek Participating Area. Hilcorp’s technical staff had reached a different technical conclusion and had included Tract 19 in their PA expansion application. The university wanted to ascertain whether its track 19 was going to be drained of subsurface natural gas from Hilcorp’s gas production program in the Falls Creek PA, which could possibly harm its correlative rights in the area due to the said DNR decision. Again, this is similar to the issue Don Shaw is facing. According to the UAFLM, the UA acreage was included in the Falls Creek PA by Hilcorp after they used the “lowest Known Gas (LKG) Method in determining projected gas reservoir areas of sand intervals. In this method, they depth mapped each productive interval of sand from different area exploration wells, looking for temperature signatures. After many observations, they concluded that warm temperature sands were productive and cooler temperature sands were water filled. They then drew LKG contours or polygons around each productive sand interval. They then did a composite of all of these contours or polygons and the outer limit of the most laterally extensive was the outer boundary for the PA. According to UAFLM, the State DNR took issue with Hilcorp’s LKG approach because there were two supposedly “dry” wells included in the polygon area, the Correa Creek #1 and the Falls Creek 43-6. The Falls Creek 43-6 well was located only about ¼ miles south of UA’s Parcel 19. Because of this, the state DNR wanted a method that excluded the areas around the “dry” wells. So instead of using productive sand maps derived from all the well logs, they just assumed that the area within 1,500 feet of the well bores of productive wells was the outline of the PA. Given that UA parcel or tract 19 was not within 1,500 feet of a productive well, it was deemed that UA’s parcel should not be part of the PA. This is also one of Mr. Shaw’s primary issues with the State DNR. Paul Craig also is affected by the same constricted PA boundary decision, at least that portion of his properties up to the northernmost boundary fault in the Ninilchik Gas Field. In order to have UAFLM better understand the subsurface geologic landscape below their excluded land parcels, BCC evaluated the following on their behalf: 1) all available nearby and readable well and surface map land information with a concentration on Hilcorp’s Frances #1 and the old Standard Oil Falls Creek 43-6 wells; 2) transcript from a 6/2/15 AOGCC hearing on Hilcorp’s amendment of Ninilchik Unit pool rules, and 3) a 1/3/17 Expansion of Falls Creek Participating Area discussion by Paul Craig along with many Ninilchik area land status and geologic structure maps of the Ninilchik gas unit. BCC then used this accrued information to construct an electronic well log correlation between the Frances #1 and Falls Creek (SOCAL) 43-6 wells through the author’s own Schlumberger Data View program and forwarded paper well log copies of the 43-6 well from UAFLM. All of this information is very much pertinent to this geologic report for Don Shaw. 6 Finally, this report for Don Shaw will use pertinent excerpts from BCC’s UAFLM geologic report to describe the geologic setting of oil and gas areas in the western Kenai Peninsula and its place in the overall Cook Inlet hydrocarbon province. It is important to understand the overall geologic picture in the Cook Inlet area, as it will demonstrate that what is observed in the Ninilchik area is not at all unique. In addition, BCC will attempt to use commonly known stratigraphic relationships in the sedimentary rock formational units within Cook Inlet to show that there is a likely gas resource, not only north and northeast of the so-called “dry” Standard Oil 43-6 well, but also southeast of the “producing” Frances #1 well, in the direction of Mr. Shaw’s Parcel 238. 3.0 COOK INLET GEOLOGIC SETTING The focus of this report, notably the Falls Creek Participating Area near Ninilchik in the vicinity of Don Shaw’s Tract 238, is a tiny part of the much larger and extensive Cook Inlet Tertiary Basin (Figure 1), a depositional trough in southern Alaska roughly 70 miles wide by 200 miles long (Calderwood and Fackler, 1972, Kirschner and Lyon, 1973). The Tertiary-aged deposits, many of which are coal-bearing (McGee and O’Conner, 1975), that accumulated in this basin, lie unconformably on older Mesozoic sedimentary basement rock formations, some of which are hydrocarbon source rocks, primarily oil. The basin developed as a forearc basin structure of the ancestral Alaska and Aleutian Mountain Ranges. Eroded sediments from the ancestral Tanana Uplands and Alaska Range, as well as the Kenai and Chugach mountain ranges, found their way into this elongate depositional trough and were deposited up to a maximum estimated depth of 26,000 feet. The thickest known depositional center is in the East Foreland area of the Kenai Peninsula north of the city of Kenai. Sediments gradually thin in all directions from this location. 3.1 Structure Structurally, the Cook Inlet basin is an asymmetric intermontane graben with a steeper, more complex northwest flank in the north end of the basin (Hackett 1976a, 1976b, 1977). The Susitna basin further to the north, as shown in Figure 1, has other structural elements in play that are separate from the development of the Cook Inlet basin, and as such, will not be discussed further in this report. The intermontane graben aspect of Cook Inlet basin is a result of being bounded on the west and north by the Castle Mountain-Bruin Bay Fault system that stretches for about 700 kilometers from the Becharof Lake area of the Alaskan Peninsula to the northern Matanuska Valley, separating the Cook Inlet forearc basin from the Jurassic Talkeetna- Aleutian Arc. The eastern boundary of the depositional basin is marked by the Border Ranges Fault system that stretches 450 kilometers from Kodiak Island to the southern portion of the Matanuska Valley and separates the Cook Inlet forearc basin from the Mesozoic subduction accretionary complex of the Chugach Mountains (Kirschner and Lyon, 1973). The result of compression from the accretionary complex to the southeast into the Cook Inlet sedimentary basin has created a series of parallel to sub parallel folds within the Tertiary basin sediments. Trends of the folds in the northern portion of the basin trend from northerly to easterly as early Tertiary right lateral drag from the Castle Mountain Fault was projected into 7 the Matanuska Valley. Further to the south within the greater part of the basin and on the Kenai Peninsula, folding trends slightly east of north to northeast. Virtually all the anticlines in the basin have the same asymmetrical structural configuration as the basin as a whole, with steeper west 8 flanks. Faulting is also common across these folds due to compressional forces. Nearly all folds are concentric in habit and involve pre-Tertiary strata in their cores at depth. 9 3.2 Stratigraphy Geologic investigations prior to the early 1970’s considered all of the Cook Inlet basin deposited Tertiary-aged sediments, many of which are coal-bearing, to belong to the Kenai Formation, named for the location where many of the easily accessible observed outcrops of these sediments were found (Barnes, 1966). Ensuing surface outcrop studies and additional subsurface information gleaned from 1950’s and 1960’s era oil exploration activities around the expansive basin showed distinguishable characteristics within the thick Cook Inlet sediment package (Magoon et al, 1976; Magoon and Claypool, 1981). In the early 1970’s, the Kenai Formation was divided into five new and separate formations within the newly named Kenai Group (Calderwood and Fackler, 1972; Hartman et al, 1972). These five separate lithologic formations were named, in ascending order: West Foreland Formation; Hemlock Conglomerate; Tyonek Formation; Beluga Formation; and the Sterling Formation (Figure 2). The West Foreland Formation is thickest (about 1,000 feet) in the West Foreland area of western Cook Inlet (Hartman, 1974). It consists of poorly sorted conglomerate, graywacke and siltstone with interbedded volcanic tuffs and local basalt flows. A few thin coal beds have been recognized in the formation. It is laterally discontinuous as it filled in topographic and structural lows on top of the older Mesozoic rocks previously laid down and since partially eroded. The West Foreland basal beds tend to reflect the lithology and mineralogy of the underlying Mesozoic terrane. The southern Alaska Range appears to have supplied most of the sediments being deposited in the West Foreland Formation. Unconformably overlying the West Foreland in the Cook Inlet basin is the Hemlock Conglomerate. This distinct formation that averages between 300 and 500 feet thick is thickest in the central and western parts of the basin, especially near the Middle Ground Shoal area. It is predominantly a sequence of conglomeratic sandstones and conglomerates, hence the name, that also contain isolated thin coal beds and finer grained sediments. The conglomeratic formation was first identified and mapped in Richfield Oil Corporation’s Swanson River Unit #1 discovery well drilled in 1957. The 570-foot-thick type section for this formation is in the Swanson River well (Calderwood and Fackler, 1972). It was in this unit that oil was first found in the Cook Inlet basin. While the primary depositional area being in the center of the basin, the formation appears to not have been deposited along the eastern basin margin and crops out in a few areas along the foothills of the Alaska Range. The middle portion of the old Kenai Formation as well as the middle of the five formations in the Kenai Group is named the Tyonek Formation. It was along the western Cook Inlet shore near the village of Tyonek where a distinctive coal-bearing sequence of Tertiary- aged sedimentary rocks are found in outcrop. In 1965, an oil exploration well was drilled by Pan American Petroleum Corporation about 5 miles southwest of Tyonek in Cook Inlet waters off of 10 11 Granite Point. The Type Section for Tyonek Formation was found in this well and was 7,650 fee thick (Figure 3). The formation is identified by the more massively bedded sandstones an numerous thick coal beds that can reach to over 50 feet in thickness. In the Kenai Peninsul area, these coal beds are somewhat thinner than that depicted in Figure 3, but are stil numerous and substantial. Finer-grained sediments are common and usually are foun adjacent to the coal beds. One of the distinctive characteristics of the Tyonek Formation is th makeup of the sandstone. It is composed primarily of white quartz with minor amounts of blac chert and opaques of heavy mineral origin (Kirschner and Lyon, 1973). This gives the sand somewhat salt and pepper appearance and is usually quite porous and permeable (Flores et al 1995). The heavy mineral suite contains a high percentage of garnet. Both the Hemloc Formation’s conglomerates and the sandstones and conglomerates of the Tyonek Formatio show characteristics of being derived from a high-grade metamorphic source terrane in centra and eastern Alaska. Braided paleostreams depositing these quartzose sands into the Cook Inle basin were primarily flowing north to south or close to it (Hite, 1976). The Tyonek Formation i said to be conformable on top of the previously deposited Hemlock conglomerate. In fact, th lowermost portion of the Tyonek Formation in Cook Inlet is composed primarily o conglomeratic sandstone with minimal finer-grained sediments or coal beds Overlying the Tyonek Formation in the Cook Inlet basin in apparent discordance is the Beluga Formation. The thick sequence of rhythmically alternating thin sands, silts and coals shows its thickest accumulations in the lower reaches of the Beluga River in northwestern Cook Inlet. The type section for the formation was observed in the discovery well of the Beluga River gas field and was 4,150 feet thick. A predominance of epidote in the heavy mineral suite indicates that the Kenai-Chugach Mountains east of Cook Inlet was the source area for the Beluga sediments that swept across the basin to the foothills of the Alaska Range on the west (Kirschner and Lyon, 1973). Some Beluga Formation fanglomerates have been seen in the eastern flank of the basin substantiating this westward sediment dispersal. The lower depositional gradient setting during the deposition of the Beluga Formation resulted in thicker assemblages of fine-grained clastic rocks such as siltstone, silty claystone, claystone and thin lignitic coal beds in contrast to the massive bedded sandstones and thick subbituminous coal beds that typify the underlying Tyonek Formation. Other distinguishing characteristics of the Beluga Formation from the underlying Tyonek Formation strata is that the sandstones are considerably darker gray in color and contain abundant lithic fragments, also derived from the metamorphic source terrane in the Chugach and Kenai Mountains. The uppermost of the five Kenai Group formations is the Sterling Formation. This formation is partially distinguished by conglomeratic facies on the margins and coeval with thick-bedded sandstones in the central part of the Cook Inlet basin. Finer-grains sediments and thin lignitic coals are also found in the Sterling. The type section for the formation was observed in the Sterling Unit No. 23-15 well drilled by Union Oil in 1961. The formation was 4,490 feet thick in this discovery well. Well and seismic data suggest that the Sterling Formation could be as thick as 11,000 feet in the East Foreland area on the northwestern Kenai Peninsula (Calderwood and Fackler, 1972). The extreme thickness of the formation in this area suggests that the depocenter of the formation shifted considerably southeastward from its 12 northwestern Cook Inlet location during deposition of the underlying Beluga Formation. This depositional shift reflects a stronger, more positive source area in the Alaska Range to the north and west. A predominance of hornblende in the heavy-mineral suite also suggests the formation being derived from Alaska Range diorites. Another common heavy mineral is hypersthene, which increases upward in the Sterling Formation section, reflects increased volcanism in the later Tertiary. The inclusion of common lighter-colored diorite rocks in the Sterling Formation results in the formation, on the whole, being lighter gray in color compared to the darker gray tones of the underlying Beluga Formation. It is also distinguished from the Beluga by its massive multi-bedded sandstones. The uppermost geologic deposits that mantle the underlying Tertiary strata over the entire study area are varying amounts of Quaternary-aged sediments that are glacial, eolian, colluvial, and fluvial in origin. The thickness of these deposits increases to the north in the Cook Inlet basin. Some of the thickest known surface deposits lie in Point Mackenzie area and areas to the west at the mouth of the Susitna River. At Lake Lorraine near Point Mackenzie, the surface gravels reach a thickness of 1,200 feet and are estimated to be over 2,000 feet thick at the mouth of the Susitna River. Owing to a lack of Pleistocene-aged glacial activity to the south within the Cook Inlet basin, surface deposits gradually diminish in a southerly direction. Minimal if any glacial deposits are seen on the Kenai Peninsula, especially south of Clam Gulch. It should be noted, for the purpose of this report, that hydrocarbons have been found in all five of the above described Kenai Group’s distinctive formations. From Figure 2, oil has been found in conventional sandstone and conglomerate reservoirs within the bottom three formations, coming almost exclusively from underlying Mesozoic formations that contain oil source rocks, namely the middle Jurassic-aged Tuxedni Formation. Conventional gas accumulations are then found in the uppermost three formations, all of which contain coal, which is the primary source rock for these primarily biogenic gases. 4.0 GENERAL GEOLOGY NINILCHIK AREA The Ninilchik Unit area of the Cook Inlet basin lies on the west side of the Kenai Peninsula between the small coastal towns of Clam Gulch and Ninilchik. The primary geologic structure in the area in the Ninilchik anticline. This anticlinal fold axis trends approximately parallel to and just off the Kenai Peninsula coastline for over 16 miles between these two towns (Figure 4). The axial area of the structure is shallowest in the south and plunges gradually to the north. This can be seen clearly from some 2D Seismic data acquired in 1998 (Figure 5). From this seismic data, the subsurface structure is segmented in part by numerous crosscutting normal faults that cut across the crest of the anticline at perpendicular and oblique angles (Figure 6). These faults create part of the reservoir trapping mechanisms that Hilcorp and previous oil and gas development companies have and continue to target in their gas exploration and development efforts. From previous investigations, it was universally accepted 13 that the west limb of these structures was steeper and the eastern limbs gentler. This is the case at the Ninilchik anticline as well as seen from the 1998 seismic (Figure 7). 14 15 16 17 18 Along the coast in the Ninilchik Unit area, thick sandstones with occasional thin lignitic coal beds are observed. These sedimentary deposits belong to the Sterling Formation of the Kenai Group (Lueck et al, 1986). Along this portion of the Kenai Peninsula, if non-Kenai Group surface deposits are present, they are minimal. This means that exploration borings in the area like the Frances #1 and the Standard Oil exploration well 43-6 (SOCAL 43-6) wells were most likely spud directly into Sterling Formation strata. Figure 8 in report Section 5.0 below will show the location of the Frances #1 and SOCAL 43-6 wells along with other past oil and gas exploration wells in the vicinity of the Falls Creek Participating Area. Hilcorp’s Frances #1 well and the older SOCAL 43-6 well are both in close proximity to Don Shaw’s 9.55-acre Tract 238 in the Falls Creek subdivision. These two wells are also located down the southeast limb of the Ninilchik anticline, same as Mr. Shaw’s land parcel. As such, this report examines and compares the subsurface geology of these two well borings in detail, as whatever is found in these two boreholes most likely also lies in the subsurface below Mr. Shaw’s property. From mudlog data from the Standard Oil exploration well 43-6, primarily poorly indurated sandstones with a few conglomeratic zones dominates the Sterling Formation sediments in this well from about 650 feet in depth to the top of the Beluga Formation reported at 2,290 feet. There were occasional finer grained deposits like siltstone, claystone and thin lignitic coal beds observed in the 43-6 mudlog. Above 650’ to the start of mudlogging at 420 feet, predominantly finer grained sediments were observed. These sediments included varying thicknesses of siltstone and claystone. Given that the Sterling Formation was predominantly deposited by meandering paleostreams, these finer-grained sediments suggest thick overbank paleo-flood deposits (Flores and Stricker, 1992). A few thin sandstones were mixed in with these finer-grained sediments. In comparison, wellbore data of Hilcorp’s 2013 Frances #1 well, reveals that logging didn’t occur until 2,580 feet. This suggests that the entire Sterling Formation was cased through as well as several hundred feet of the uppermost Beluga Formation. Given the preponderance of mostly poorly indurated to unconsolidated sediments common in the Sterling Formation, this is completely understandable. As noted above, the Beluga Formation in the old SOCAL 43-6 well was first intersected at an approximate depth of 2,290 feet. Well data from Hilcorp’s Frances #1 well suggests that the top of the Beluga Formation was first intersected at 2,107 feet. The bottom of the Beluga Formation and corresponding top elevation of the Tyonek Formations reported at both wells is 5,765’ and 5,227’, respectively. The 183’ distance disparity of the top elevations of the Beluga Formation and the 538’ disparity in the bottom elevations of the Beluga Formation in the Ninilchik area between the Frances #1 and 43-6 wells is most likely the result of the 43-6 being slightly down the Ninilchik anticlines plunging axis and eastern limb from the Frances #1 well. Also, a factor here in the top and bottom formational differences is the arbitrary determinations of formational changes based on mudlog and electric log interpretations. From the SOCAL 43-6 mudlog, the Beluga Formation in the well shows a distinct change from the overlying Sterling Formation. While the Sterling Formation has multiple, thick 19 sandstone horizons with thin finer-grained sediments and an occasional thin lignitic coal bed, a common meandering stream depositional characteristic, the underlying Beluga Formation has thicker assemblages of finer-grained sediments and thinner sandstone intervals (Flores et al, 1997). The incorporation of thicker assemblages of finer-grained sediments and thinner sandstone bodies suggests deposition via braided paleo-streams (Flores and Stricker, 1993). The lignitic coal beds in the Beluga Formation are more numerous but still generally thin, with an occasional thicker bed between 5-10 feet thick. The well logs from the Frances #1 well mimics these Beluga Formation trends. Occasionally, thicker sandstone horizons 25-50 feet thick are observed in the Beluga Formation. One particular thick sandstone over 150 feet thick is seen in the uppermost 750 feet of the formation. This thicker multi-storied sandstone suggests deposition in a meandering stream environment that is more typical of the overlying Sterling Formation. In fact, this thick sandstone’s presence in the upper portion of the Beluga suggests a transitioning from braided to meandering streams as the Cook Inlet basin was getting filled with sediments from the rising mountain ranges that surround it. These thicker Beluga sandstones have in the past, and continue to exhibit reservoir accumulations of gas. Some have been developed for gas in the past and some still do. The uncharacteristic thick sandstone in the upper portion of the Beluga Formation has also been seen in the Beluga area of Cook Inlet and was observed at multiple locations during Cook Inlet Regional Corporation’s (CIRI) 2010-11 exploration foray into possible underground coal gasification development. The author only notes this fact as to not ignore the Beluga Formation for its potential for conventional gas development. With the slightly thicker coal beds in the Beluga Formation in contrast to the overlying Sterling Formation, there is a greater chance of biogenic methane gas migrating upward into the thicker Beluga sandstones and becoming a conventional gas resource. As noted above, underlying the Beluga Formation in the Ninilchik area and within Cook Inlet as a whole, is the Tyonek Formation. As discussed in the above Stratigraphy (3.2) section, the Tyonek Formation is noted for its massive sandstones as well as massive subbituminous coal beds. Although the coal beds in this formation are thinner in the subsurface of the Kenai Peninsula, compared to those near the Tyonek Formation’s primary depocenter of in northwestern Cook Inlet and in the Beluga Coal Field, they are still substantial, reaching thicknesses of up to 25 feet thick. Several in the 20-foot range lie in the subsurface within the Ninilchik Unit and are observed in the well logs of the Frances #1 well and the well and mud logs of the SOCAL #43-6. From the SOCAL #43-6 well file information, the top of the Tyonek Formation was intersected at 5,765 feet of depth. No bottom depth was given for the formation. In Hilcorp’s Frances #1 well files, the formation’s top was at 5,227 feet and the bottom was determined to be at a depth of 11,453 feet. Since the Hilcorp well’s bottom depth was well beyond the total depth of the SOCAL #43-6 well, the Tyonek Formation’s bottom in the #43-6 well was evidently never reached. It should also be noted that the electric logging suite used in the Frances #1 well reached only down to 10,590 feet. This suggests that Hilcorp was only considering hydrocarbon resources in the middle to upper portion of the Tyonek Formation and the Beluga 20 Formation. Substantiating this in the well files of the Frances #1 well, was Hilcorp’s intersect of a Tyonek G2 sand at 11,330 feet of depth. This lower Tyonek Formation sand was evidently not targeted by the logging at the conclusion of drilling. As mentioned above, one of the distinguishing characteristics of the Tyonek Formation in the Cook Inlet area is its many thick massive sandstones. In the SOCAL #43-6 well, many thick Tyonek Formation sandstone beds were indeed noted in the mudlog from this well. A couple sandstone intervals were over 150 feet thick and numerous were 30-100 feet thick. Many of the thick sandstones were also noted in the limited electric logs of the 43-6 well that were available to Belowich Coal Consulting (BCC). The available e-logs only show data between the depths of 7,180’ to 8,430’. These sandstones formed primarily by crevasse splay and stream channel deposits, with the former being essentially a breakout of the stream channel over an adjacent flood plain during a flood event. The Tyonek Formation sandstones, noted in the SOCAL 43-6 mud logs were comprised of fine to coarse-grained, light gray to salt and pepper-colored, quartz-rich sands that were occasionally pebbly. Some thin conglomeratic zones were present. Dark opaque-colored fragments in the sands were primarily chert, although some mica and kaolinite were noted. Some areas of the sandstones were cemented with calcite. The 43-6 mud logs also note the sand grains being subangular to sub-rounded, sometimes with a smoky appearance. Sand grain characteristics will be discussed in more detail later in this report as to their potential to enhance or reduce hydrocarbon reservoir porosity and permeability. Finer-grained siltstone, claystone and carbonaceous shale beds were also common in the 43-6 mudlog, mostly associated with subbituminous coal beds of varying thicknesses, although sometimes being interbedded with finer-grained Tyonek sands. In the vicinity of some coal beds, finer-grained sediment zones were noted to be up to 150 feet in thickness. This is not all that uncommon in depositional environments formed by braided surface streams, one of the characteristics of the Tyonek Formation deposition in the Cook Inlet basin. These finer deposits are characteristically overbank flood deposits, channel plug (abandoned stream channel) deposits, and lacustrine (freshwater lake) deposits. They can also form from sag ponding adjacent to syntectonic conditions or contemporaneous growth fault movements. Underlying the Tyonek Formation in the lower Kenai Peninsula area of the Cook Inlet basin were the lowermost two formations in the Kenai Group, the Hemlock and West Foreland Formations. Hilcorp’s Frances #1 well data show that the Hemlock Formation lies between 11,453’ and 11,747’ in the well with the underlying West Foreland Formation incorporated between the depths of 11,747’ and 12,025’. With a queried intersection of Jurassic basement rocks at 12,825’, it is unclear where the West Foreland Formation ends and the basement rocks begin. In any event, these lowermost Kenai Group rocks and basement rocks do not play a part in the primary objectives of this report, that being the determination if Don Shaw’s Tract 238 is either being drained of gas resources or if gas resources could feasibly extend into Mr. Shaw’s parcel from the nearby Falls Creek Participating Area. Therefore, any further discussion of these two lowermost Kenai Group formations is not warranted. 21 5.0 PAST EXPLORATION IN NINILCHIK AREA To better understand the subsurface geology in the Ninilchik area of the lower Kenai Peninsula and eastern Cook Inlet basin for this report, it is important to reflect on what early oil and gas explorers thought and determined during their initial drilling exploits. An anticlinal structure was first recognized in the sea cliffs north of Ninilchik and south of Clam Gulch. This structural feature was then further evaluated as a highly potential exploration target. This was in the late 1950’s and the structure was mapped in the subsurface with the seismic, gravity and magnetic tools available at the time. Fourteen exploration wells were subsequently drilled between 1961 and 2002 in the vicinity of this anticline. Standard Oil of California (SOCAL) drilled the first well, SOCAL Falls Creek #1 (SFC1) in 1961 to test this promising anticlinal structure. Although the primary exploration objective was oil, none was found. However, gas was discovered in the upper Tyonek Formation in four sandstone zones and the SFC1 was completed as a gas well in 1961. The SFC1 was ultimately plugged and abandoned because the estimated size of the accumulation did not justify the cost of facilities and transportation. Infrastructure in the area was pretty much nonexistent during the early exploration period, and was a significant deterrent to development. Since the early 2000’s, this infrastructure impediment has been alleviated for the most part. Additional oil and gas exploration activity in the Ninilchik area occurred on and off throughout the 1960’s and 1970’s. Unocal drilled the Ninilchik #1 well in 1962 and tested gas in two Tyonek Formation zones. Between 1964 and 1978 six more exploration wells were drilled with oil and gas objectives. These were the Mobil Ninilchik #1, SOCAL Falls Creek #2, SOCAL Falls Creek #43-6, Brinkerhoff Ninilchik #1, Unocal Clam Gulch #1, and Texaco Ninilchik #1. All six of these wells were eventually plugged and abandoned as “dry” holes without testing any prospective reservoir sandstones within the Tyonek Formation, although the Texaco well briefly flow tested gas from one Tyonek Formation interval. Between 1979 and 1996, there appeared to be a hiatus in oil and gas exploration in the area. Undoubtedly, the lack of an oil discovery was a contributing factor along with the lack of said infrastructure. Finally, though, interest in the area picked up and in 1996, Marathon Oil Corporation drilled the Corea Creek #1 well and drill stem tested four intervals within the Tyonek Formation, recovering some gas and water. The results of the well verified and delineated a promising Falls Creek reservoir. Between 2001 and 2004, Marathon Alaska Production Company drilled three more exploration wells in the northern portion of the Ninilchik Unit in the Falls Creek area. The Falls Creek Unit 1 RD was drilled in 2001 and defined the interval from 5,513’ to 8,900’ as the Falls Creek PA reservoir, which was composed of multiple sand intervals in the mid to upper Tyonek Formation. This was followed shortly thereafter by the Falls Creek #3 well in 2003. 22 After another exploration hiatus from late 2003 to 2013, Hilcorp finally acquired Marathon Oil’s assets in the western Kenai Peninsula‘s Ninilchik Unit in 2013. This was after acquiring Marathon partner Union Oil’s Kenai Peninsula assets in 2012. Hilcorp then progressed to drill four more gas exploration and potential development wells in 2013-14 in the Falls Creek area. There were, in order, the Frances #1, Falls Creek #4, Falls Creek #5 and Falls Creek #6 wells. Figure 8 below illustrates the location of the exploration wells drilled in and adjacent to the present Falls Creek Participating Area (PA). 6.0 FALLS CREEK PARTICIPATING AREA DISCUSSIONS The formation of the Falls Creek Participating Area (PA) was initially conceived in 1961 upon the drilling of the SOCAL Falls Creek #1 well. The planned objective of this initial Ninilchik area well was oil in the Hemlock Conglomerate. No oil was found in the Hemlock, but gas was discovered in the Tyonek Formation rocks overlying the Hemlock Conglomerate. According to State of Alaska records, four Tyonek Formation sands were tested with individual gas flow rates of 30,000 to 2 million cubic feet per day. The well was completed in an upper Tyonek Formation sand between measured depths of 7,562’ and 7,600’. In February 1964, the Falls Creek #1 was certified as the discovery well, which established gas in commercial quantities for this area of the Kenai Peninsula and within the Tyonek Formation. Following this discovery well, SOCAL proceeded to drill two delineation wells. One was the Falls Creek #2 drilled four miles south of the Falls Creek #1 in 1966. This was followed by the SOCAL 43-6 well in 1973. Results from these two delineation wells were deemed negative and the wells were considered “dry” holes based only on electric log data interpretation. It is now known through modern advances in electric logging technology that early e-log suites were of poor quality and making any qualitative determinations of subsurface gas accumulations were questionable. Furthermore, with the nearby Falls Creek #1 well having flowed gas in the Tyonek Formation, especially from a zone 7,562’ to 7,600’ below the surface, very close to the same depth that the Frances #1 is currently flowing commercial volumes of gas, the quick dismissal of the Falls Creek #2 and Falls Creek 43-6 wells as “dry” is particularly suspect, especially within the Falls Creek PA. The Falls Creek PA reservoir is presently defined as the interval between the measured depths of 5,513’ and 8,900’ in the Marathon Falls Creek #1 RD well type log. The reservoir is composed of multiple sand intervals in the mid to upper Tyonek Formation. A refinement of the vertical and horizontal boundaries of the gas pool into the lower Beluga Formation within Conservation Order 701 is presently in play in continuing discussions between Hilcorp and the AOGCC and the State DNR. The actual reservoir structure, as interpreted by Marathon, was of a faulted anticline defined by four-way dip closure on the southeast and northwest. Closure to the southwest and to the northeast is by fault seals from crosscutting normal faults that lay perpendicular to the axial trend of the Ninilchik anticline (State of Alaska Division of Oil & Gas, 2003). The presence of the fault closure to the northeast is important in the case of the University of Alaska Facility 23 & Land Management (UAFLM) and the land holdings of PLC, LLC., but not to the Don Shaw parcel. As such, it will not be discussed further herein. The fault closure directly south of Don Shaw’s parcel 238, however, 24 25 does come into play and will be discussed in more detail later in this report. The Falls Creek PA reservoir sands, interbedded in part with silt, clay and coal, were deposited in a fluvial environment. Marathon based its initial Falls Creek PA boundary on their interpretation of the Lowest Known Gas (LKG) in each of the mapped sandstones in the upper Tyonek Formation within the participating area. Marathon’s interpretation of the data has shown that the area included in the Falls Creek PA is reasonably known to be underlain by hydrocarbons and known or reasonably estimated to be capable of producing or contributing to production of hydrocarbons in paying quantities. In the 2003 State of Alaska Division of Oil & Gas’s (DOG) Ninilchik Unit Expansion document discussions, the Division had some concerns regarding Marathon’s interpretation of the southwest part of the proposed Falls Creek PA and was waiting for the completion of the drilling of the Falls Creek #3 well before determining the configuration of the PA to the southwest. It is important to note here that there wasn’t any concern on the DOG’s part with the PA in the northeast direction toward the 43-6 well and areas to the northeast up to the crosscutting fault or to the southeast in the direction of Don Shaw’s Tract 238. There will be more discussion on this later in the report as well, especially as it pertains to reservoir sandstones to the southeast of Hilcorp’s Frances #1 well. Based on all the data and interpretations available to the DOG in 2003, all sand intervals of the upper Tyonek Formation that are gas-bearing within the proposed Falls Creek PA, as of 2003, are below the depth of the LKG and are supposedly not gas-bearing outside the proposed participating area northern and eastern boundaries. With the present Falls Creek PA reservoir defined above as the Tyonek Formation reservoir sand interval between the depths of 5,513’ and 8,900’, this exclusion of potential gas-bearing intervals to the north of the PA up to the crosscutting fault or to the southeast down the Ninilchik’s southeast limb some distance beyond the present PA boundary does not make sense. This is especially so with the results of the drilling of Hilcorp’s Frances #1 well in 2013. From the drilling results from this well and the identification of productive gas sands between 7,569’ and 7,593’, all are within Marathon’s original PA reservoir interval. The author, in this report, will attempt to add the missing geological information that the DOG did not have available, or failed to consider, during the initial expansion hearing of the Falls Creek PA in 2003. It will be determined that not considering the remaining portion of the 5,513’ to 8,900’ PA interval to the northeast in the direction of the northernmost crosscutting fault and to the southeast down the southeast limb of the Ninilchik anticline is shortsighted and without validity. 7.0 TYONEK FORMATION DEPOSITIONAL ENVIRONMENTS In previous discussions, it was noted that a major characteristic of the Tyonek Formation is its massive sandstones as well as massive subbituminous coal beds. It was also mentioned that individual beds of coal and sandstone are somewhat thinner in the subsurface of the Kenai Peninsula, compared to those near the Tyonek Formation’s primary depocenter in northwestern Cook Inlet and specifically in the Beluga Coal Field. 26 It was also discussed previously that a distinctive characteristic of the Tyonek Formation is the makeup of the sandstones, being composed primarily of white quartz with minor amounts of black chert and opaques of heavy mineral origin. The associated mineral assemblage in these salt and pepper sandstones suggest a provenance from a high-grade metamorphic source terrane in central and eastern Alaska. At the time of Tyonek Formation deposition during the Miocene Epoch, Cook Inlet was early in its depositional history as a developing forearc basin fronting the ancestral Alaska and Aleutian Mountain Ranges. As such, the steeper gradients into and within the basin from the northern sediment source areas resulted in the development of an alluvial plain with sediment laden braided streams coursing through it. With the Chugach and Kenai Mountains yet to rise, the coarse-grained braided paleo stream channels flowed into the basin from the north, heading southward to the sea. The bottom of the Tyonek Formation, similar to the Hemlock Conglomerate underlying it, was primarily composed of coarser-grained conglomerate and conglomeratic sandstone from progressing alluvial fans and braided stream channels flowing into the basin. As the early Cook Inlet basin slowly filled with these sediments, the depositional gradient lessoned, and the braided streams spread out over the alluvial plain. This resulted in the deposition of more sandy conglomerates, conglomeratic sands and sandstone. Parallel to these dominantly south flowing braided streams and between alluvial fans emanating from the ancestral Alaska Range were overbank flood plains and mires. In these areas away from the actively flowing paleo streams, peat swamps developed. Mires or peat swamps also developed on abandoned braid belt streams and between channels. The longer they lasted before being overrun by a stream channel, the thicker the peat deposit. These peat deposits, over time, coalified into the subbituminous coal beds seen today. One of the characteristics of braided streams is that they are sediment laden, resulting in aggrading stream channels. This means that as they flow, they deposit large amounts of sediment eroded from upstream areas into their channels. As they aggrade, channels will move from the higher elevation depositional areas to new lower elevation depositional areas (Hayes et al, 1976). Unlike meandering stream channels that move laterally across an alluvial or depositional flood plain by cutting into older sediment deposits, aggrading braided streams move laterally when their channels fill up with sediments, spilling out into adjacent lower topographic areas. Both of these depositional environments can result in thick peat accumulations lateral to them, depending on how long they remained unaffected by the nearby stream channels. Some of the thickest peat swamps, and thus thicker future coal beds, lie between alluvial fans. The more distant these alluvial fans are from each other, the more extensive the peat swamp. In areas of active braid belt stream deposition, lateral peat swamps have a hard time existing in place too long because they are soon overrun by the aggrading streams. During the past 18 years, the author has spent considerable time closely examining the Tyonek Formation in detail in Cook Inlet. As coal geologist for Evergreen Resources, Pioneer Natural Resources and for Alaska Earth Sciences, the latter in the Beluga Coal Field on behalf of 27 Cook Inlet Regional Corporation (CIRI), the author logged, in minute detail, over 25,000 feet of core samples, over 80% of which were in Tyonek Formation. The logging of this core was for unconventional gas exploration purposes for coalbed methane (CBM) and underground coal gasification (UCG). During the examination of the extensive cores, trends and characteristics of the Tyonek Formation’s clastic sandstones and finer-grained sediments were examined in great detail, in addition to the coal beds. The author is fairly confident that there is no one presently in Alaska with the amount and depth of experience examining the Tyonek Formation in as much detail as the author did when examining the amount of core in the above unconventional exploration projects. This gives the author a unique perspective on the depositional environments of the Tyonek Formation within Cook Inlet. The author used the close examination of the Tyonek Formation cores, as well as some Beluga Formation cores in the Beluga Coal Field, to develop the most comprehensive correlation of subsurface formational rocks in the northern Cook Inlet area. These correlations incorporated not only the subsurface strata from the more than 25 wells the author personally logged, but also every nearby old oil and gas exploration well. In total, over 50 exploration boreholes (wells) were incorporated in these extensive correlations. One of these correlated areas is in northern Cook Inlet from Palmer to Big Lake and then south to Point Mackenzie, totaling over 200 square miles. The other is from the Texas Petroleum Company Pretty Creek #1 well to the Simpko Koloa #1 well in the area of the Beluga Gas Fields, totaling over 100 square miles. These subsurface geological correlations offer a unique perspective on the characteristics of the Tyonek Formation over long distances. From these correlations, not only were the subsurface coal beds correlated, but also the reservoir sandstone units. This latter information, the author feels, is quite beneficial to the proposed correlation in this report between Hilcorp’s Frances #1 and SOCAL’S #43-6 well as well as beyond the Falls Creek PA northeast to the crosscutting fault and eastward down the southeast limb of the Ninilchik anticline. One of the geological and lithological aspects of these long-distance correlations was the discernment of separate environments of deposition during the laying down of the different lithostratigraphic units. It was possible to segregate the rocks seen in the core samples into two primary environments. These include those laid down in a more active fluvial depositional environment with those laid down in a more quiescent lacustrine regime. Lithologies common to the fluvial environments (fluvial dominated lithofacies) were thick assemblages of fine to coarse-grained sandstones, pebbly sandstones, conglomerates and lessor amounts of fine- grained clastic rocks such as siltstone, claystone (mudstone), and carbonaceous shale. Coal seams were thicker and cleaner in the fluvial dominated lithofacies, often with good face cleat development. Those lithologies common to the quiescent lacustrine dominated lithofacies were thick assemblages of very fine-grained sandstones, siltstones, silty claystones, claystones (mudstones), and carbonaceous shale. The coals seams, in these environments, were generally thin and dirty, often were amorphous and calcite cemented, and had poor, if any, cleating. Although one of this report’s focuses is on the potential correlation of some reservoir sandstone units between the Frances #1 and SOCAL #43-6 wells and beyond to the north crosscutting fault and southeast down the limb of the anticline, it is important to not discount 28 the importance of the coal seams that surround these potential reservoir sand units. The author’s previous Tyonek Formation correlation work recognized that coal beds located within a dominantly fluvial depositional environment possessed better developed cleating with more closely spaced cleat fracturing. Coal beds with better developed cleating also tended to be thicker and cleaner than those coal beds associated with lacustrine dominated depositional environments, most of which were thinner, dirtier and has less developed cleating. More extensive cleating also means more methane gas generation and improved permeability for this gas to reach the wellbore. It is well known and recognized that natural gas found in the Cook Inlet basin is primarily biogenic, or emanates from the abundant subsurface coal beds found in primarily the Tyonek Formation but also in the overlying Beluga Formation. As such, it is important to not ignore the characteristics of the adjacent coal beds when searching for gas-rich sandstone reservoirs. There is a much better chance of locating potential gas sands if the latter overlie a thicker, cleaner coal bed formed within a fluvial depositional environment. In turn, sandstone bodies overlying thinner and dirtier lacustrine depositional environment formed coal beds will usually lack significant accumulations of gas. Other things to look for is the type of cap rock directly overlying the coal beds. Since the coal beds are essentially the source rock for the natural (methane) gas found in conventional sandstone reservoirs, if the methane gas cannot rise through the cap rock due to its impermeable properties, it will remain within the coal bed itself and won’t be available for exploitation within the overlying sandstone unit. The most impermeable cap rocks are those that are composed primarily of clay. The thickness of the cap rock is also important as a thicker clay or claystone unit will be more impermeable than a thinner clay or claystone unit. It is also important to recognize that natural fracturing in the rocks can help release underlying methane gas to overlying sandstone units through impermeable cap rocks. This fracturing is more likely to occur in close proximity to faults and along the apexes of anticlines. Finally, any discussions of formational depositional environments, should include vertical and lateral extent. From the authors previous correlation work in northern and western Cook Inlet, it was learned that the two primary depositional systems, a fluvial dominated one and a lacustrine dominated one, tended to exist for long periods of time geologically. The geological time to deposit a lacustrine dominated depositional environment was generally longer than a fluvially dominated one. From these subsurface investigations, both the major coal seams and thicker adjacent sandstone units were quite laterally extensive. Thinner coal seams and sandstones were not as laterally extensive. In the western portion of Cook Inlet, in the Beluga River area, almost all larger coal seams and most of the thicker, distinctive sandstone units were traced for up to 15 miles from north to south, the primary paleo stream direction. In the northern Cook Inlet area, these coal bed and sandstone units were traced similarly for many miles. From examining outcropping sandstone units as well as coal beds as part of a 1984 geological study on the Kenai Peninsula (Lueck et al, 1986), the author noted many sandstone units in the Beluga and Sterling Formations were traced for up to two miles. From these studies in the Beluga and Sterling Formations and from the aforementioned sandstone reservoir units in the Tyonek Formation, it can easily be assumed that thicker 29 sandstone zones intersected in the Hilcorp and SOCAL exploration wells could easily extend laterally to the north to the crosscutting fault north of the Falls Creek PA as well as to the southeast in the vicinity of the Don Shaw’s Tract 238. It is only about one and one quarter miles from the Falls Creek #43-6 well to the northern cross-cutting fault and less than 3,000 feet between the Frances #1 well and Don Shaw’s parcel. In Figure 8, a map of the Falls Creek PA wells with a yellow line that shows the Frances #1 and 43-6 wells lining up with the University of Alaska land parcels 19 and 18 in a straight line to the crosscutting fault, the latter of which straddles lands owned by PLC, LLC. Conversely, the dashed line shows Don Shaw’s Tract 238 southeast of the Frances #1 well and directly downslope on the southeast limb of the Ninilchik anticline. Based on the authors previous correlation work in northern and western Cook Inlet, primarily within the Tyonek Formation, it was decided to compare the two primary depositional systems in the Tyonek Formation within the two wells being studied for this report, namely Hilcorp’s Frances #1 and SOCAL’s #43-6. The below Table 1 reflects the measured depth of the identified two depositional systems in these wells. Again, as noted previously, the author only had a little over 1,200 feet of electric logging data available from the old SOCAL #43-6 well. The entire Tyonek Formation was available from the Frances # well and the environments from 5,500’ to 8,500’ were closely examined. From the examination of the logs from the Frances #1 well, four each lacustrine and fluvial dominated depositional environments were noted in the 3,000’ of Tyonek Formation examined. Only two each lacustrine and fluvial dominated depositional environments were noted in the #43-6 in the total 1,230-foot thick logged interval available to the author. In the lacustrine dominated Tyonek Formation strata, in both wells, thinner and dirtier coal seams were noted along with thinner sandstone units. Many of the sandstone beds were cemented. The dominate strata in this lacustrine environment was finer grained sediments, primarily siltstone, silty claystones and claystones. In contrast, the fluvial dominated strata in both wells exhibited TABLE 1 TYONEK FORMATION DEPOSITIONAL ENVIRONMENTS (Select Depths in Frances #1 & SOCAL #43-6 wells) Hilcorp #1 SOCAL #43-6 Depositional Environment Measured Depth (Ft.) Measured Depth (Ft.) Lacustrine 5,500’ – 6,070’ Fluvial 6,070’ – 6,660’ Lacustrine 6,660’ – 6,840’ Fluvial 6,840’ – 7,060’ Lacustrine 7,060’ – 7,290’7,200’ – 7,336’ Fluvial 7,290’ – 7,912’7,336’ – 7,966’ 30 Lacustrine 7,912’ – 8,230’7,966’ – 8,340’ Fluvial 8,230’ – 8,500’8,340’ – 8,430’ thicker and cleaner coal beds, thicker sandstone intervals and lessor amounts of finer-grained sediments. Only minor cementing of the sandstone units was noted. The developed gas sand in Hilcorp’s’ Frances #1 well is located in the one of the lower fluvial dominated units. 8.0 HILCORP FRANCES #1 WELLFILE GEOLOGY DISCUSSION In order to get a better idea on what Hilcorp saw during the drilling of the Frances #1 well that would help with correlations to the SOCAL #43-6 and beyond to the crosscutting fault as well as southeast toward Shaw’s Tract 238, the author took a good look at the Frances #1 well files from the Alaska Oil and Gas Conservation Commission (AOGCC) website. It shows that the Frances #1 well was spud on October 9, 2013 and drilled to total depth of 12,920 feet. The well reached TD depth on 12/11/13. Several months of testing and completion activities followed. In the well file, Hilcorp confirmed that it spud the well directly into Sterling Formation strata. There was no mention of younger, more recently deposited surface deposits. The file also confirmed that the Beluga Formation was intersected at 2,107’, the Tyonek Formation at 5,227’, The Hemlock Conglomerate at 11,453’ and the West Foreland Formation at 11,747’ and Jurassic basement rocks at 12,825’. The author took note of the lithologic descriptions from the mudloggers who examined the drill cuttings coming across the shaker tables at the surface. Prior to the intersecting the Tyonek, the primary description of the sand/sandstone from the overlying Beluga Formation was that they were dark gray in color, were “tuffaceous” in character and contained lots of mica, were malleable, contained lots of greenish grains, mostly angular to subrounded grains, exhibited poor porosity, and incorporated a good percentage of calcite, chlorite and lithic fragments and appeared to have a clay supported matrix. Tuffaceous is an incorrect term used for the more malleable grains here as it implies a volcanic origin. The above characteristics point directly to having a provenance from Chugach/Kenai Mountains which contain a high percentage of metamorphic rocks which, when eroded, deposit sediments that have the above distinct characteristics. When the drilling of the Frances #1 reached the underlying Tyonek Formation at 5,227’, there was a distinct change in the sandstone appearance and other pertinent characteristics that differentiate the Tyonek Formation sands/sandstones from the overlying Beluga Formation sands/sandstones. The most noticeable change is the change in color from dark gray to a salt and pepper appearance. The sand grains in the Tyonek are described by the mudloggers as being clear to translucent to smoky in color contrasting with the dark gray to black lithic grains. Common in the Tyonek sands were small pebbles that substantiates that the sandstone grain 31 sizes are somewhat coarser and pebbly. Porosity between the grains was increased in the Tyonek as it didn’t contain anywhere as much pore clogging mica, clays, chlorites, metamorphic grains that the overlying Beluga Formation contained. Grain shapes were similar, subangular to subrounded but there was mention of some rounded grains and better sorting which help in porosity and permeability. Also, the description tuffaceous wasn’t used as much by the mudloggers when describing the sands of the Tyonek. There were also common notes of degassing organic coaly materials, which wasn’t mentioned very much in the Beluga Formation. One of the more common distinguishing features of the Tyonek Formation sands noted in the Frances #1 mud logs was the presence of an increasing number of unconsolidated sands. Although there were some disaggregated and loose sands in the overlying Beluga, they seemed to be more common in the Tyonek. One of the possible reasons for this was the lack of or lesser amounts of interstitial “tuffaceous” grains (i.e. micas, clays, chlorites etc.) that were much more common in the Beluga Formation. These supposedly “tuffaceous” grains, which tend to adhere the adjacent sand grains together, effectively improved the induration of the sands and allowed them to stand up better when being cut by the drill bit. This increase in induration or cementing came at a cost of porosity, though, which is one of the reasons why the Beluga Formation on the Kenai Peninsula isn’t as targeted as much for potential gas reservoirs as the formation is in the Beluga Gas Field on the opposite side of Cook Inlet. In this latter area, the pore clogging “tuffaceous” grains are in shorter supply, being much farther from Chugach/Kenai Mountains source areas. Unconsolidated sands provide a marked increase in porosity and permeability for water and hydrocarbon movement. Speaking of hydrocarbon movements, the Frances #1 well file also listed 10 apparent hydrocarbon or gas shows in sand or sandstone zones between 4,400 feet and well TD. The bottom two shows are beyond 12,000 feet and below the Tyonek Formation and will not be expounded upon here. The other 8 shows are listed below with depths and associated comments. TABLE 2. Frances #1 Gas Shows – from AOGCC well file Shows Depth Formation Comments #1 4,450’ – 4,680’Beluga Gas background rising #2 4,730’ – 4,800’Beluga Gas show only #3 5,045’ – 5,150’Beluga Zone of interest, could be productive if enough porosity #4 5,350’ – 5,421’Tyonek Visible evidence of degassing, not enough data #5 6,270’ – 6,355’Tyonek Unconsolidated in part, gas rose to 1,110 units, a fine clean sand carrying 32 a moderately strong gas #6 6,550’ – 6,650’Tyonek Included coalbed having up to 664 units gas #7 7,550’ – 7,710’Tyonek Disaggregated loose sand and tuff- aceous sand, very dull yellow flour- escence, trace yellow residue, up to 1,607 units. “This is producing sand” #8 7,740’ – 7,880’Tyonek Sandstone & conglomerate, also has very dull golden yellow fluorescence slight yellow residue The list of shows is interesting because it also contains sandstones in the Beluga Formation. This is important. The present refinement of the vertical and horizontal boundaries of the Ninilchik Beluga/Tyonek Gas Pool within Conservation Order 701 in 2017 includes expansion of the PA to include both the Beluga and Tyonek Formations. Just restricting the PA to the Tyonek Formation would not be maximizing the resource in the eyes of the State of Alaska. The shows in the Beluga Formation and the upper part of the Tyonek Formation, above the known #7 producing gas sand, may not ultimately be producible, but unless they are tested, this is not known definitively. The #7 and #8 Tyonek Formation gas shows also mention in their comment sections, that they exhibited very dull yellow fluorescence with a trace of yellow residue. It is known that many common minerals fluoresce under UV light. Fluorescence spectroscopy is a type of electromagnet spectroscopy that analyzes fluorescence of a sample. It involves using a beam of light, usually ultraviolet light, that excites the electrons in molecules of certain compounds and causes them to emit light; typically, but not necessarily, visible light. This light, like a black light, uses either a UV lamp or a Laser Induced Fluorescence (LIF) as a light source. Other than the basic minerals that naturally fluoresce yellow, like dolomite (in magnesian limestones), aragonite and calcareous mudstones, aromatic hydrocarbons also fluoresce. Fluorescence spectrography is also used for vitrinite reflectance determinations on organic matter in collected cutting samples that indicate the maturity of the sample in regards to being in the oil or gas “window”. The mudloggers, working during the drilling of the Hilcorp Frances #1 well, were most likely looking for the presence of hydrocarbons in the interstitial spaces between the sand grains indicating that hydrocarbons are in the sample or passed through the sample during an earlier time. Because, there was a dull yellow fluorescence and a trace of yellow residue, this is evidence that hydrocarbons have passed through or are still in the sand/sandstone sample being investigated. A lack of fluorescence, however, does not prove the absence of hydrocarbons in the zone of interest (Daniels et al, 1992). Similarly, a lack of sample staining (residue) does not prove that a reservoir lacks producible hydrocarbons. Further testing of these sands is still warranted. 9.0 HILCORP GEOLOGIST COMMENTS IN 2015 33 On June 2, 2015, a Frances #1 drainage hearing was held at the Alaska Oil and Gas Conservation Commission (AOGCC) offices in Anchorage. The reason for the hearing was in regards to Hilcorp Alaska LLC’s application for the proposed amendment of pool rules in the Beluga/Tyonek gas pool, Ninilchik Field. This amendment involved a proposal to modify conservation order 701 to provide unlimited spacing throughout the Ninilchik Field and the Beluga/Tyonek gas pool. The other objective, according to Hilcorp, was to modify the existing rules related to the requirement to escrow revenue for the uncommitted tracks in so-called “suspense” accounts. At this hearing, Mr. Donald Shaw, a mineral right owner with property within 3,000 feet of the Frances #1 well, expressed concern that his land was possibly being drained of gas by the Frances #1 well and should be entitled to his fair share of escrowed royalty money. However, Mr. Shaw has to date refused to sign a lease with Hilcorp to receive these possible royalties, mainly because his land parcel lies outside the Falls Creek PA, but within the 3,000’ spacing exemption from Hilcorp’s producing Frances #1 well. As such, he is presently not eligible for the royalties that he firmly believes he is eligible for. As noted earlier, this geologic report by Belowich Coal Consulting (BCC) is being submitted for Mr. Shaw’s benefit to help him better understand what he potentially has beneath his property in order to make a more informed decision on whether or not to sign a lease with Hilcorp. In this report, there appears to be geologic grounds that his property being drained by the Frances #1 producing gas well is indeed quite possible. Although the AOGCC hearing of June 2, 2015 discussed many different particulars regarding pool rules, spacing requirement, escrow payment procedures etc., it was the testimony of Hilcorp’s geologist during the hearing that contained the most pertinent information that has a direct bearing on the Frances #1/SOCAL 43-6 well correlation work and Mr. Shaw’s drainage claims that this report is addressing. During this June 2, 2015 hearing, a Mr. David Buthman, Hilcorp senior geologist with 25 years petroleum geology experience with Unocal, Chevron and for the last three years Hilcorp, gave his testimony on the geology of the Ninilchik Field and Falls Creek PA, in particular. In discussions with Dan Seamount, AOGCC geologist member, Mr. Buthman noted that the Ninilchik Field is contained within one large anticline that plunges slightly to the northeast. This anticline is broken up into three pools, domes or structural closures. The three pools are, from the south to north, the Susan Dionne, Grassim Oskolkoff (GO), and Falls Creek Participating Areas. Dave Buthman continued in his testimony stating that a large paralleling reverse fault sets up the anticline along its northwest side (Figure 4). There is no paralleling fault along the east side of the anticlinal structure, predominantly the land portion of the structure. Mr. Buthman also states that the topmost gas pools are charged, if charged at all. This is both in the Tyonek Formation and in the overlying Beluga Formation. The author assumes that topmost 34 refers to the pools at or near the crest of the anticline. However, Mr. Buthman does not say in the hearing how far down the limbs of the anticline the charged areas extend. As the hearing continued, Dave Buthman states that they are presently drilling the Blossom well (this is in 2015) outside the blue where we can. The blue referring to the Participating Area (PA). He goes on to say that he is finding a number of sands that aren’t on the top of the pool that are present outside the pool, down the structure to the east. He also states that the “fluvial channels generally go northeast-southwest” as well as “wrapping around the east side of this Falls Creek pool”, which is where “we landed with a hundred foot of gas sand at the Frances well”. Given Mr. Buthman’s note of gas pools in axis areas of the Ninilchik anticline as well as down the eastern limb of the same anticline, he was asked by AOGCC’s Dan Seamount if there was any gas production from stratigraphic structural traps within the saddle areas between the three separate gas pools. Mr. Buthman replied that there was production from these saddle areas. One of the gas sands down the eastern limb of the anticline was located within the Beluga Formation. Another interesting statement in the hearing was made by Dan Seamount which concerned Hilcorp’s previous analysis of analog depositional systems. He noted that Hilcorp uses a mean fluvial channel width of 500 feet with 15% exceeding 3,000 feet. Dan asked Mr. Buthman where he got the analogs to come up with this mean fluvial channel width. Dave said that Hilcorp used analogs from all over the world, and specifically pointed to analogs of the Ninilchik River, Kasilof River as well as the Kenai River. The author finds Hilcorp’s use of these three Alaskan rivers as analogs interesting considering these streams are primarily meandering streams. Although meandering streams are somewhat common in the overlying Beluga and especially Sterling Formations, during the time of deposition during the Tyonek Formation, braided streams were the norm (Flores et al, 1995, 2004). A better Alaskan analog for determining fluvial channel width for the Tyonek Formation, and possible lower portion of the Beluga Formation, is the present-day Matanuska and Susitna Rivers. Using Google Earth maps measurements, these rivers range in width from 1,000 feet to a mile wide in the case of the Matanuska River and from 3,000 feet up to 10 miles wide in the case of the Susitna River. 10.0 CORRELATION OF HILCORP FRANCES #1 AND SOCAL #43-6 WELLS As outlined in the 2.0 Background section of this report, Belowich Coal Consulting (BCC) was retained by the University of Alaska’s Facility and Land Management (UAFLM) Department in 2018 to ascertain in a geologic analysis whether its track 19 in the Falls Creek Participating Area (PA) within the Ninilchik Gas Field was possibly being drained of subsurface natural gas from Hilcorp’s gas production program in said PA, specifically from the Frances #1 well. Further discussions and received informational materials from UAFLM at the time expanded the geologic study to determine if there is a potential gas resource within and to the north northeast of the Standard Oil 43-6 well. This determination could potentially mean that not only should UA’s parcel 19 be included the Falls Creek Participating Area but also its parcel 18 further to the northeast, as well as in Paul Craig’s leases in Sections 31 and 32 up to a bounding northwest trending fault. In as much as Don Shaw’s Tract 238 is actually closer to the Frances #1 well than either of the U of A parcels, being less than 3,000 feet directly down depositional slope 35 from the bottom-hole position of the producing Hilcorp gas well, information from the U of A study is also pertinent to the herein Don Shaw study. To accomplish what the University of Alaska was requesting back in 2018, BCC decided to undergo a lithological correlation study from well logs of both the 2013 Hilcorp Frances #1 well as well as the 1973 SOCAL #43-6 well. For this study, BCC received the LAS log files for Hilcorp’s 1973 drilled Frances #1 well from the University of Alaska, who received it from the Alaska Oil and Gas Conservation Commission (AOGCC). BCC took this LAS file and entered it into BCC’s downloaded Schlumberger Data View Program. The Data View program displays digital data from the logging suites run upon the completion of drilling of any particular exploration or production well, which can be from oil, gas or mineral wells. Within this program, BCC chose six different e-logs that were run on the Frances #1 well to display. These logs were Caliper, Gamma Ray, Induction (deep), Neutron Porosity, Bulk Density and Sonic. They are shown in the below Figure 9 from left to right, respectively. The LAS files for the older 1973 SOCAL #43-6 exploratory oil and gas exploration well could not be located by the University of Alaska. Instead, the U of A forwarded to BCC copies of the paper logging runs from this latter well. The only complete section of logging, as noted previously in Section 4.0 of this report, was from e-log data between the depths of 7,180’ to 8,430’ only. The best set of logs that could be used for lithologic characterization was the Gamma Ray, Caliper and Formation Bulk Density logs. These are shown in the darker colored log suite of Figure 10. A separate paper log depicting Neutron Porosity was also received by BCC from the U of A. No Induction or Sonic logs were received for the #43-6 well. BCC then printed out copies of Frances #1 LAS file logs from 5,500’ to 8,500’ of depth as well as the paper logs of the SOCAL #43-6 between 7,180’ to 8,430’ of depth, and by taping them together, formed a long roll of log data. The rolls of log data were then compared side to side to determine the best correlations between the two. Figures 9 and 10 show about a two-hundred-foot section of both logs that clearly show direct correlations between the two wells as they pertain to the gas producing sand from the Frances #1 and a correlatable sand body in the #43-6 well. These two figures also depict two correlatable coal beds above and one large correlatable coal bed below this particular producing 24-foot reservoir sand. After Belowich Coal Consulting (BCC) had the above two-hundred-foot zone correlated between the Frances #1 and 43-6 wells, BCC expanded the correlation between these two wells to include all the sand bodies and coal beds (two-feet and thicker) between 7,180’ to 8,430’. Again, this depth interval was the only logged zone that was available to BCC from the U of A, within the old SOCAL 43-6 well. The below Table 3 list this correlation data from the Hilcorp Frances #1 and SOCAL #43-6 wells between the depths of 7,180’ and 8,430’. In Table 3, BCC depicts the lithology (either sand/SS or coal bed) along with its intersected depth below surface, the apparent thickness of each lithologic strata, porosity information from the sands/SS units and a separate comment column for each well. From the Table 3 correlation information, some generalities can be made. One of these being that the lithologic units in each well pretty much match up with each other between the 36 two wells that are 2/3rds of a mile apart. Another is that correlatable lithologic units between the two wells are pretty much along the same plane on the eastern limb of the Ninilchik anticline. The intersection depths of comparable units at the SOCAL 43-6 appear to be slightly lower than those at the Frances #1 well, but always within about 75 feet of each other. The coal correlations are pretty amazing in their lateral continuity of thickness over this 2/3rds of a mile distance. Only one coal bed appeared to be missing between the two wells and that bed 8,086 feet deep in the Frances #1 well, appeared to have been eroded out by an overlying sandstone in the area of the 43-6 well. This is a common occurrence and constitutes nothing unusual in coal-bearing environments. 37 38 39 TABLE 3 HILCORP FRANCES #1 - SOCAL #43-6 CORRELATABLE SANDS AND COAL BEDS FRANCES #1 SOCAL 43-6 Lithology Depth (ft.)Thickness (ft.)Porosity %Comments Depth (ft.) Thicknes s (ft.)Porosity %Comments Coal Bed 7,289 - 7,305 16 7,335 - 7,348 13 Coal Bed 7,332 - 7,341 9 7,364 - 7,368 4 Sand/SS 7,354 - 7,400 46 24-32 Good Porosity 7,390 - 7,447 57 23-48 Great Porosity/Crossover Coal Bed 7,472 - 7,475 3 7,520 - 7,524 4 Coal Bed 7,493 - 7,495`2 7,548 - 7,550 2 Coal Bed 7,540 - 7,546 6 7,599 - 7,605 6 Coal Bed 7,553 - 7,560 7 7,619 - 7,626 7 Sand/SS 7,574 - 7,598 24 16-27 Producing Gas 7,643 - 7,667 24 18-33 Good Porosity/Crossover Coal Bed 7,623 - 7,643 20'7,698 - 7,718 20 Coal Bed 7,689 - 7,695 6 7,765 - 7,670 5 Coal bed 7,852 - 7,870 18 7,894 - 7,910 16 Sand/SS 7,888 - 7,910 22 22-26 Overlies coal 7,936 - 7960 24 15-36 Good Porosity Coal Bed 7,910 - 7,914 4 7,960 - 7,963 3 Coal Bed 8,010 - 8,017 7 8,050 - 8,058 8 Sand/SS 8,036 - 8,042 8 19-25 Sandstone not present Sand/SS 8,050 - 8,068 18 19-30 8,066 - 8,100 34 18-32 Cemented near top Sand/SS 8,076 - 8,086 10 21-26 Overlies coal 8,106 - 8,120-14 15-33 Cemented near top Coal Bed 8,086 - 8,092 6 Coal bed eroded by SS Coal Bed 8,126 - 8,128 2 8,170 - 8,172 2 Sand/SS 8,162 - 8,176 14 10-30 Mostly cemented Sandstone not present Coal Bed 8,194 - 8,198 4 8,236 - 8,238 Coal Bed 8,206 - 8,210 4 8,240 - 8,246 6 Sand/SS 8,234 - 8,286 52 23-28 Overlies coal 8,270 - 8,320 50 22-30 One cement zone Coal Bed 8,286 - 8,295 7 8,320 - 8,326 6 Coal Bed 8,321 - 8,324 3 8,356 - 8,359 3 Coal Bed 8,326 - 8,333 7 8,367 - 8,372 5 40 The correlatable sandstone units between the two wells is also very interesting. Almost every sand body that is in the Frances #1 well is also seen in the SOCAL 43-6 well at the same stratigraphic position between the correlatable coal beds. The only exceptions are the sand units that were first intersected at 8,036’ and 8,162’ in the Frances #1 well. In the upper sand zone starting at 8,036’, three separate but close proximity sand units, separated by finer-grained deposits total 36 feet. In the 43-6 well, this sand zone, intersected at 8,066’, is shown to include two sandstone units that cover an interval of 54’, with 48 feet comprised of sand/SS. If you add up the fine-grained zones between three sand/SS units in the Frances #1 well, you get a total of 50 feet. This shows that this particular sand/SS unit is laterally continuous over the 2/3rds of a mile between the two wells. As for the sand/SS unit intersected 8,176’ in the Frances #1 well, but not in the 43-6 well, this sandstone was the thinnest of all those noted in the correlation section, being only 14 feet thick. It was also shown to be cemented from the Frances #1 sonic log. Thinner sandstone bodies, especially ones that fine upward rather quickly, which this one did, are usually the result of overbank deposits or crevasse splays which break out from the main stream channel during a flood event (Horne et al, 1978). These sand/SS units are usually thin and discontinuous, and that is what we see here. When looking at all the other sand/SS units in the two wells within the 1,044-foot logged interval, they are all laterally continuous and appear to be approximately of the same thickness and stratigraphic position during their deposition at the well locations. In most cases, the correlatable sand/SS units in the SOCAL 43-6 well are slightly thicker than their corresponding counterparts in the Frances #1 well. The known producing sand/SS unit in the Frances #1 well between 7,574’ and 7,598 is exactly the same thickness (24 feet) as its counterpart in the 43-6 well between 7,643’ and 7,667’. Porosities of the sand/SS units in both wells appear to be good. Some of the lower logged sand/SS units appear to be cemented in part. The two uppermost units, however, appear to show not only good porosity, but there is evidence of crossovers between the bulk density and porosity logs, indicating the present of gas. Since gas is already being produced from the 7,574’ – 7,598’ sand/SS unit in the Frances #1 well, its counterpart in the 43-6 well also shows similar gas potential. The same circumstances and characteristics occur in the sand/SS units between 7,354’ and 7,400’ in the Frances #1 well and 7,390’ and 7,447’ in the 43-6 well. There is another aspect of the relationships between coal beds and the sand/SS units in the two wells that should be mentioned at this point. As stated earlier in this report, it is widely known that almost all of the gas being produced in the Cook Inlet area of Alaska is biogenic and is coming from the abundant coal resources contained within this large structural and stratigraphic basin (Flores et al, 2004). In all coal-bearing basins, including Cook Inlet, the coal bed is the source rock and the sand/SS rocks are the reservoir rocks, when you are talking about conventional gas resources. For unconventional gas resources, the coal bed is both the source rock and the reservoir rock, as in coalbed methane resources. In this case within the Falls Creek PA, where we are talking about the conventional gas resources, it is important to know where the coal beds (source rocks) are located in relation to the sand/SS (reservoir rocks). Obviously, if there are no coal beds around, no conventional gas resource will be found either. 41 Since methane is lighter than air and water due to its lower specific gravity and density, it is also less dense than the surrounding rocks. Therefore, it will tend to rise in the stratigraphic column. If this gas encounters a dense rock unit with a low permeability, it will be trapped below this lower permeability unit. These low permeability units are clay-rich rocks like siltstone, silty claystone, claystone, carbonaceous shale and coal beds. So, it seems understandable that gas emanating out of a coal bed into an overlying sandstone, which in turn is capped by finer- grained rocks and coal beds is a good place to look for potential gas resources. If the coal source rock is thick, it is capable of producing more gas. In the case of the producing gas sand/SS unit in the Frances #1 well located between 7,574’ and 7,598’, it overlies the thickest coal bed noted in the Frances #1 well identified to be between 7,623’ and 7,643’. This 20-foot thick coal is evidently pumping out considerable gas to make the 24-foot thick sand producible. Immediately overlying this thick coal bed is about 25 feet of finer-grained rocks that could be considered as impermeable. Given the gas is being reported in the sand/SS unit above this finer-grained interval, this relatively impermeable unit is evidently fractured. Since we know that the Ninilchik Gas Field is near the apex of an anticline, which is usually fractured, this seems reasonable. From Table 3, the side comments reveal that three of the sand/SS units directly overlie coal beds. In this case, methane gas emanating from the underlying coal seam will rise naturally into the overlying sand/SS unit and will not stop until it is impeded by an overlying finer-grained rock unit with low permeability that is not fractured, thus forming a stratigraphic trap. Although maybe not tested by Hilcorp in the Frances #1 well, these sand/SS units that directly overly coal beds are good places to expect to find trapped natural gas. There are numerous thick coal beds in the Tyonek Formation that underlie sand/SS units. There are even coal beds in the Beluga Formation that underlie sand/SS units. All of these are good places to look for methane gas accumulations. Given that the SOCAL 43-6 well has pretty much the same stratigraphic relationships at the Frances #1 well as shown in the above Table 3, it is a good bet that trapped conventional gas can be found in the sand/SS units here as well. 11.0 DISCUSSIONS In the 2018 geologic report for University of Alaska’s Facility and Land Management (UAFLM) Department, Belowich Coal Consulting (BCC) defined the clear purpose of that report. That was to strongly suggest that hydrocarbon resources (specifically gas sands) very likely extend northeastward from Hilcorp’s Frances #1 well, extending to include the SOCAL 43-6 well, U of A land parcels 19 and 18 and areas right up to the crosscutting fault northeast of them. BCC then proceeded to methodically build a case for the reasoning behind its assumptions and determinations to come to the reasonably-based decision that will be expounded upon in this report section and in Section 13.0 below. In this present report for Mr. Don Shaw of Clam Gulch, most of the important “evidence” brought forth in the UAFLM report to back BCC’s assumptions and determinations is also applicable to Don Shaw and his Tract 238 directly down depositional slope from the Frances #1 well. Due to the similarities in proximal distances to the Falls Creek PA between the 42 three separate landowners (U of A, PLC, LLC and Don Shaw), it is important to lay out the “evidence’ accumulated for the UAFLM report in this geologic report for Don Shaw as well, for comparison purposes. A separate discussions section of this report for Don Shaw, Section 12.0, follows and is more site specific to Mr. Shaw’s Tract 238 and its closer proximal position to Hilcorp’s producing Frances #1 well. The assumptions and determinations made in both the 2018 UAFLM geologic report and this present Don Shaw geologic report are determined by the basic geology of the Cook Inlet basin. This Tertiary sediment-rich basin contains multiple geologically distinct formations that have historically demonstrated to possess hydrocarbon reservoir rocks, common stratigraphic and structural mechanisms to trap and hold hydrocarbons, coal beds to source the biogenic hydrocarbons (natural or methane gas), and attractive paleo environments during the time of deposition that concentrated the generated hydrocarbons so that they could be exploited by present day drilling and production techniques and procedures. To further add credence to the “evidence” described within this report that BCC is trying to project to the reader, the author utilized numerous pieces of information to come up with a plausible conclusion. This information includes actual well log file information and statements from past drilling activities, comments made by company geologists and other officials that were involved with the exploration drilling, electric logging data from two nearby wells under investigation, past geological field observations along the lower Kenai Peninsula coast, commonality of an expansive collection of Tyonek Formation lithological correlation data from other parts of the Cook Inlet basin that extend laterally for “miles”, and just plain familiarity with Tertiary coal-bearing formations within the Cook Inlet basin and their tendencies. The aforementioned correlatable “information” and “evidence” exhibited in the 2018 UAFLM report will be examined again in the below site-specific Don Shaw Tract 238 discussions. 12.0 Don Shaw Tract 238 Discussions In Section 10.0 of Belowich Coal Consulting’s (BCC) 2018 geologic report for the University of Alaska’s Facility and Land Management (UAFLM) Department , 24 bullet points were listed as important geological or informational findings that supported BCC’s geologic contention that potential productive gas sands lie to the northeast Hilcorp’s Frances #1 well up to the northernmost crosscutting fault in the Ninilchik Gas Field, thus incorporating the University of Alaska parcels 19 and 18, and some of PLC, LLC’s land holdings. Most, if not all, of these same geological or informational findings also appear to support the contention that similar productive gas sands lie to the southeast of Hilcorp’s Frances #1 producing gas well, in the direction of Don Shaw’s Tract 238. In fact, there are geological nuances that suggest that Mr. Shaw may have an even stronger case that the University of Alaska and PLC, LLC. The following 24 geological and informational bullet points are herein submitted again in the case of Mr. Shaw. Both the coal-bearing Beluga and Tyonek Formations are known to have gas-bearing sand/sandstone reservoirs in the Cook Inlet Basin 43 Beluga Formation sands/ss to 150’ thick and Tyonek Formation sands/ss to 200’ thick were noted in the electric logs run The sandstones in the lower Beluga Formation and the Tyonek Formation are laterally continuous and are much wider in nature due to their primarily braided stream paleo deposition. Meandering intervals from the upper Beluga and Sterling Formations are often vertically stacked and less laterally continuous. The coarser and purer nature of the Tyonek Formation sands versus the Beluga Formation sands enhance their porosity and permeability. The Ninilchik anticline trends closer to land further to the north improving the chances of stratigraphic and structural trapping of hydrocarbons in the land portion of the Falls Creek PA. Hilcorp was targeting the Beluga and middle to upper Tyonek Formations for gas sands based on only logging from 2,600’ to a depth of 10,590’ in a 12,920-foot deep well. SOCAL’s Falls Creek #1 had discovered gas in four Tyonek Formation sand/ss units and tested flow rates of 30,000 to 2 million cubic feet/day in one of the Tyonek Formation sands between 7,562’ and 7,600’, at about the same depth as the producing gas sand in the Frances #1 well. SOCAL’s Falls Creek 43-6 was deemed “dry” but was never tested due to the search for oil and the lack of infrastructure on the lower Kenai Peninsula. The poor-quality e-log data in the 50’s, 60’s and early 70’s was the primary factor in determining the “dry” designation at the time. This would probably not have been the case under todays technological advances in the art of electric logging. The Falls Creek PA reservoir is defined as the interval between the depths of 5,513’ and 8,900’. If this interval wasn’t potentially developable, it wouldn’t have been listed in the PA. In 2003, the State of Alaska Division of Oil & Gas had concerns of the Ninilchik Unit expansion of the Falls Creek PA in a southwest direction. There was no mention of concerns in a northeast direction toward the U of A land parcels and the northern crosscutting fault, nor east or south-eastward down the depositional slope on southeast limb of the Ninilchik anticline. Thicker and cleaner coal beds below sand/sandstone beds improves the latters chances of being a reservoir gas sand. This combination is mostly found in fluvial dominated depositional environments. Having logged over 25,000 feet of Tyonek Formation core gives BCC an advantage of identifying locations of gas sands in relation to accompanying coal beds. This has resulted in coalbed and sandstone bed correlation work in Cook Inlet covering long distances. Mudloggers on Hilcorp’s Frances #1 well noted numerous “degassing” organic coaly materials in the Tyonek Formation as well as a few in the lower Beluga Formation. This gas has to go someplace and that is most likely into a porous sand/ss unit above these degassing coaly materials. A definite increase in unconsolidated sands in the Tyonek Formation versus the Beluga Formation was noticed by the mudloggers. Loose sands have greater porosity and permeability and are better gas sand reservoir targets. 44 The Frances #1 well file noted eight (8) apparent gas shows between 4,400’ and 8,000’. Three (3) were in the Beluga Formation and five (5) were in the Tyonek Formation. Two of the latter Tyonek Formation shows exhibited yellow fluorescence with trace of yellow residue. These findings demonstrate that gas has been or is presently passing through that particular sand/ss unit. Hilcorp geologist David Buthman comments in the AOGCC hearing of 6/2/15 that there is one large anticline at Ninilchik that plunges slightly to the northeast. This anticline is broken into three pools, domes or structures by crosscutting faults. These pools are cut off on northwest side by a large reverse fault but are open down limb on the east side and outside of PA. This is in the direction of the SOCAL 43-6 well, the U of A parcels and Don Shaw’s Tract 238. Mr. Buthman also notes in same hearing that there are charged gas sands at the crest of the anticline but does not say how far down east limb of the anticline the charged areas extend. He also noted that gas is found in the lower saddle areas of the anticline, between the domes, as well. This suggests that the gas sands can theoretically be found down the limbs for some distance, at least to the subsurface depth of the saddles. In the 2015 hearing, Mr. Buthman also mentions that there are a number of sands that aren’t at the top of a pool, but are found down structure to the east and outside the PA. Again, this is in the direction of the 43-6 well, the U of A parcels, areas up to the crosscutting fault to the north and toward Mr. Shaw’s Tract 238. In a big revelation, Mr. Buthman goes on to say that fluvial paleo channels, or where the sand/sandstone units are located, generally trend in a northeast-southwest direction. This is the same direction from the Frances #1 well that points toward the 43-6 well and the two U of A land parcels up to the crosscutting fault. In another interesting statement by Buthman, he says that one of the gas sands down the eastern limb of the anticline was located in the Beluga Formation. In discussions with Dan Seamount of the AOGCC during the same June 2015 hearing, it was revealed that Hilcorp used Alaska stream analogs (Ninilchik, Kasilof, and Kenai Rivers) to estimate Tyonek Formation paleo channel sand width (average 500’ to 3,000’ wide). Since the above rivers are meandering streams, this is an incorrect analogy. Since the Tyonek Formation, at the time of its deposition in the early stages of the Cook Inlet basin development, was primarily as a result of braided streams, Hilcorp should have used the Matanuska and Susitna Rivers as analogs. These latter rivers have much more expansive stream widths from a bare minimum of 1,000 feet to multiple miles wide. This more accurate width of stream in a NE direction from the Frances #1 well would easily cover the U of A land parcels and more, up to the crosscutting fault as well as down depositional slope to and beyond the Don Shaw property. In BCC’s correlations between the Hilcorp Frances #1 and SOCAL 43-6 wells, a distance of 2/3rds miles from each other in a northeast direction, almost all coal beds and sand/ss intervals maintained their thickness and relative stratigraphic positions. The 24-foot gas sand in the Frances #1 well was exactly in the same position between two thinner coal beds above it and one large coalbed below it, all three of which maintained their thickness as well. This strongly suggests that these same lithologic 45 units extend not only to the northeast for a considerable distance, but also toward the southeast toward Don Shaw’s Tract 238. Two sands at the SOCAL 43-6 at 7,390’ and 7,643’ exhibit good porosity and have apparent crossovers between their bulk density and neutron porosity logs. This suggests they are gas reservoirs. This trend should continue to the northeast and southeast. The following geological nuances of the position of Mr. Shaw’s property in relation to the bottom hole location of the Frances #1 well suggest that Mr. Shaw may have an even stronger case than that the University of Alaska and PLC, LLC. in regards to potential methane drainage losses. To support this contention, BCC offers up two site specific examples of methane movement observed from other parts of Alaska. In the early fall of 1997, the author was involved in an exploration core drilling program with Sumitomo Coal Mining Inc of Japan at the eastern end of Wishbone Hill. Sumitomo paid for the two-borehole exploration drilling program in advance of possibly investing in the Jonesville Mine project for a proposed 500,000-ton thermal coal contract with Nerox Power Systems, the coal leaseholder of the Jonesville Coal Lease at the time. Drilling took place on the high plateau near the eastern apex of Wishbone Hill. The USGS Coal Division in Denver, Colorado heard about the deep coring effort of bituminous ranked coal and arranged for several methane desorption cannisters to be sent to the project to test the gas contents of the intersected coal beds deep within the Wishbone Hill syncline. Upon the completion of the drilling, the two-foot long coal core filled cannisters were sent to Denver for desorption testing. The measured methane content from the desorption studies noted that several coal seams exhibited minimal gas contents while others showed more normal expected gas readings in standard cubic feet per ton. When examining which coal seam sample showed lower than expected gas contents, it was found that these low gas coals corresponded to the same coals that were exposed in the 1960’s era strip pits on the northern limb of the syncline. It was evident that in-seam produced methane gas had migrated up the north limb of the syncline and escaped to the atmosphere within the still opened strip pits. The lateral distance between where the strip pits were and the downhole location of the coal beds intersected was approximately one mile. During the late summer of 2014, the author was involved in a coalbed methane exploration well in the Healy Creek Valley within the Usibelli Coal Mine property east of Healy, Alaska. During the exploration, a core hole (Healy Creek #1) was drilled to test the methane gas contents of several of the subbituminous rank coal seams that had been or were currently being mined by Usibelli Coal Mine on their property holdings. Again, numerous methane desorption canisters were filled with two-foot long coal cored samples during the drilling and sent to a lower 48 testing lab. Gas content sample results from this drilling program revealed similar lower than expected gas readings from some of the canistered coal samples as that seen at Wishbone Hill in 1997. In this case, about ½ mile to the east of the core drilling site, and up depositional dip, was the large Hydraulic Pit from an earlier Usibelli Coal Mine stripping operation. 46 It is important here to reiterate again to the reader that methane gas is lighter than air and water due to its lower specific gravity and density. It is also less dense than the surrounding rocks. Therefore, it will tend to rise in the stratigraphic column either into overlying stratigraphic rock units if it has an avenue of escape (i.e. fractures) or directly into more porous and permeable roof rocks. And as we have seen from the above two Alaska examples, generated coal-bed methane will also rise laterally within a coal bed itself, if it is not flat lying. Since coal beds in the Cook Inlet basin are rarely, if ever, flat lying, this naturally produced coal gas will rise continuously up dip within every coalbed in coal-bearing formations until this gas either reaches a flat-lying zone (i.e. apex of an anticline), reaches an impermeable barrier (i.e. fault) or grades into an impermeable stratigraphic rock unit (i.e. pinch-out stratigraphic trap). In regards to Don Shaw’s Tract 238 property in the Falls Creek Subdivision, it lies directly down depositional slope from the bottom hole location of Hilcorp’s producing Frances #1 gas well. Mr. Shaw’s property is also north of a known crosscutting fault and there are no discernible fault barriers identified in the earlier seismic studies between his parcel and the Frances #1 well. In other words, there is no identifiable major impediment to stop generated methane gas from coal seams below Mr. Shaw’s 9.55-acre land parcel from migrating upslope toward the Frances #1 well gas pool. If for some unknown reason, methane generated below Mr. Shaw’s property does not flow up dip within the noted laterally continuous 24-foot thick gas producing sand illustrated in Figures 9 and 10, there are multitudes of other porous sand units sitting under Mr. Shaw’s property within the Tyonek and Beluga Formations that likely do extend unimpeded laterally between his property and the Frances #1 gas well. BCC is confident that the noted 24-foot sand is not the only producing gas sand within the Frances #1 well, especially since Hilcorp’s David Buthman said there is a 100-foot producing gas sand within the same well in his 2015 AOGCC Hearing comments. Finally, on the extremely slim chance that all porous and permeable gas sands within the Tyonek and Beluga Formations under Mr. Shaw’s parcel miraculously pinch out between his property and the Frances #1 well, all is not lost. Mr. Shaw has multitudes of Tyonek and Beluga Formation coal beds below his property that are continuously generating methane gas. This gas resource is all migrating up depositional dip within these coal beds toward the apex of the Ninilchik Anticline. Near this apex where fracturing of the rock strata is common, the generated Shaw property methane gas will inevitably migrate upwards into producing sand units within the Frances #1 well or closer to the apex where it can be produced through the Falls Creek Unit 1 RD well or one of the other Falls Creek pad wells. Mr. Shaw’s property location, relative to the position of the producing Falls Creek PA wells, especially the Frances #1 well, makes all this very much possible, and most likely inevitable. 13.0 CONCLUSION Belowich Coal Consulting (BCC) wants to thank Mr. Don Shaw for approving of this geological report patterned after an earlier 2018 geologic report for the University of Alaska’s Department of Land Management. It hopefully addresses his concerns of being drained of potential gas resource revenue by not being a part of Hilcorp’s Falls Creek Participating Unit 47 within the Ninilchik Gas Field. Some readers may question the wisdom of utilizing a geologist with years of experience in coal mine exploration and unconventional gas exploration to help out in discussions of a conventional gas resource issue. I can say to these readers that BCC is a longtime member of the American Association of Petroleum Geologists (AAPG), the American Institute of Professional Geologists (AIPG) as a certified professional geologist (CPG-11077), is registered as a Professional Geologist with the State of Alaska and is a member in good standing with the Alaska Geological Society. BCC also reiterates, from prior discussions in this report, to have directly logged over 25,000 feet of Cook Inlet Basin coal-bearing rock, mostly within the Tyonek Formation, the geologic formation that contains the primary gas reserves not only in the lower Kenai Peninsula area, but also in the greater Cook Inlet basin area as a whole. Since oil and gas company geologists mainly look at subsurface rock through shaker table cuttings or via electric logging means, BCC is fairly confident that there is no geologist presently in Alaska that has observed as much Beluga and Tyonek Formation strata up close and personal as BCC has through all the coring work it has been associated with over the years. In addition, BCC’s Cook Inlet geology work with companies exploring for unconventional gas resources such as coalbed methane and underground coal gasification and correlating the intersected geologic formations over miles, has incorporated a decent working knowledge of the industries electric logging techniques. BCC has had to learn how to use the varying type of e-logs to identify all the different lithology’s found in the Tertiary formations of Cook Inlet. With BCC’s extensive core work, it has been able to directly compare the cores to the log responses, a tool or skill that many geologists do not ever have the opportunity to experience. BCC, however, does herein acknowledge, that it was not afforded the examination of the number of electric logs and other downhole data that oil and gas company have easily at their disposal. Nor does BCC have any access to seismic data of the Ninilchik area or other proprietary exploratory or formation testing tools. The LAS files from Hilcorp’s Frances #1 well and some partial logs from the SOCAL 43-6 well, plus the mud logs of each, were all BCC had to work with. Nevertheless, the information that BCC did have at its disposal was sufficient enough to make a determination in this case. The primary goal of this geologic report was to predict or estimate the chance that Don Shaw’s Tract 238 in the Falls Creek Subdivision was potentially being drained by gas development activities by Hilcorp in the Falls Creek Participating Area (PA), and particularly by the Frances #1 producing gas well. While BCC can’t equivocally say with 100% assurance that Tract 238 will be drained by continued gas extraction in the area by Hilcorp, the evidence brought forth in this geologic report suggests that this will indeed be the case and probably has been the case soon after the Frances #1 well went into production. To add additional credence to this assumption, BCC queried a very knowledgeable and experienced petroleum drilling engineer regarding the earlier U of A Parcel 19 and 18 drainage issues. This drilling engineer has worked with British Petroleum (BP) on Alaska’s North Slope as well as with Samson Oil in Oklahoma and Talisman’s Energy in Australia and the eastern U.S. In explaining the situation with this drilling engineer, he noted from experience that gas in reservoir sands can easily be drained up to a half mile in most sand/sandstone reservoirs and could extend well over a mile 48 in loose unconsolidated sands. The evidence brought forth in the above report notes that the productive sand in the Frances #1 well at 7,574 feet is unconsolidated and this sand extends to the SOCAL 43-6 well at 7,643’ with the same characteristics. This same productive sand, therefore, most likely extends southeastward toward the Don Shaw property. His land parcel is barely over ½ mile southeast of the Frances #1 well. In conclusion, BCC also wants to reiterate to the readers of this report that the abundance of relatively thick coal beds in the Tyonek Formation throughout the Cook Inlet Basin, many of which exhibit clean (1.5 specific gravity or less) lenses or benches, are going to produce considerable amounts of methane (natural gas) at depth, where they reach higher relative coal rank and can hold more gas per unit volume. This methane will undoubtedly migrate upslope within the same coal bed and/or escape to rise and get trapped in overlying porous and permeable sands/sandstone units below an inevitable finer-grained, less permeable cap rock. It is unfathomable, geologically speaking, to predict that all these sand/sandstone units (hundreds of feet of them in two different formations) would all pinch out or disappear right before reaching Don Shaw’s Tract 238 directly adjacent to the Falls Creek Participating Area. 14.0 REFERENCES Barnes, F.F., 1966, Geology and coal resources of the Beluga-Yentna region, Alaska: U.S. Geological Survey Bulletin 1202-C, 54 p. Calderwood, K.W., and Fackler, W.C., 1972, Proposed stratigraphic nomenclature, Kenai Group, Cook Inlet basin, Alaska: American Association of Petroleum Geologists Bulletin, v. 56, no. 4, p. 739- 754. Daniels, Paul A., Finnell, David B., and Anderson, William J., 1992, Show evaluation from Methods in Exploration, Wellsite Methods: Development Geology Reference Manuel, in AAPG Methods in Exploration Series, No 10, pages 109-114. Flores, R.M., Stricker, G.D., and Stiles, R.B., 1995, Tidal Influence on deposition and quality of coals in the Miocene Tyonek Formation, Beluga Coal Field, Upper Cook Inlet, Alaska; in Geologic Studies in Alaska by the U.S. Geological Survey, 1995: U.S. Geological survey Professional Paper 1574, p. 137-156. Flores, R.M., and Stricker, G.D., 1992, Reservoir framework architecture in the Clamgulchian Type Section (Pliocene) of the Sterling Formation, Kenai Peninsula, Alaska: U.S. Geological Society Bulletin 2068, p.118-129. Flores, R.M., and Stricker, G.D., 1993, Interfluve-Channel facies models in the Miocene Beluga Formation near Homer, South Kenai Peninsula, Alaska: in Rao, P.D., and Wolff, E.N., eds., Focus on Alaska’s Coal ’93: Alaska Coal Conference, 4th, Fairbanks, 1993, Proceedings, Fairbanks, University of Alaska Mineral Industry Research Laboratory Report 94, p. 140-166. 49 Flores, R.M., Stricker, G.D., and Bader, L.R., 1997, Stratigraphic architecture of the Tertiary alluvial Beluga and Sterling Formations, Kenai Peninsula, Alaska; in 1997 Guide to the Geology of the Kenai Peninsula, Alaska: Alaska Geological Society Report, p. 36-53. Flores, R.M., Stricker, G.D., and Kinney, S.A., 2004, Alaska coal geology, resources and coalbed methane potential: U.S. Geological Survey Digital Data Series 77, 140 p. Gorney, David and Enos, Jennifer, 2013, Ninilchik Gas Field, Cook Inlet, Alaska, in D. M. Stone and D. M. Hite, ed., Oil and Gas Fields of the Cook Inlet Basin, Alaska: AAPG Memoir 104, p. 225-243. Hackett, S.W., 1976a, Speculative tectonic evolution of the Cenozoic Shelikof trough, south central Alaska; in Short notes on Alaska geology – 1976: Fairbanks, Alaska Division of Geological and Geophysical Surveys Geologic Report 51, p. 13-18. __________ 1976b, Regional gravity survey of Beluga basin and adjacent area, Cook Inlet region, south central Alaska: Fairbanks, Alaska Division of Geological and Geophysical Surveys Open-file Report 100, 40 p. __________ 1977, Gravity survey of Beluga basin and adjacent area, Cook Inlet region, south central Alaska: Fairbanks, Alaska Division of Geological and Geophysical Surveys Geologic Report 49, 38 p. scale 1:250,000, 3 sheets. Hartman, D.C., Pessel, G.H., and McGee, D.L., 1972, Preliminary report on the stratigraphy of the Kenai Group, upper Cook Inlet, Alaska: Fairbanks, Alaska Division of Geological and Geophysical Surveys Special Report 5, scale 1:500,000, 11 sheets. __________ 1974, Kenai Group of Cook Inlet basin, Alaska: Fairbanks, Alaska Division of Geological and Geophysical Surveys Open-file Report 49, 5 p., scale 1: 500,000, 11 sheets. Hayes, J.B., Harmes, J.C., and Wilson, T.W. Jr., 1976, Contrasts between braided and meandering stream deposits, Beluga and Sterling Formations (Tertiary), Cook Inlet, Alaska, in Recent and ancient sedimentary environments in Alaska: Alaska Geological Society Symposium, Anchorage, 1976, Proceedings, p. J1-J27. Hite, D.M., 1976, Some sedimentary aspects of the Kenai Group, Cook Inlet, Alaska, in Recent and ancient sedimentary environments in Alaska: Alaska Geological Society Symposium, Anchorage, 1976, Proceedings, p. I1-I23. Horne, J.C., Ferm, J.C. Caruccio, F.T., and Baganz, B.P., 1978, Depositional models in coal exploration and mine planning, Appalachian region: American Association of Petroleum Geologists Bulletin, v. 62, 12, p. 2379-2419. Lueck, Larry, Rawlinson, S.E., Belowich, M.A., Clough, J.G., Goff, K.M., Reinink-Smith, L., 1986, Kenai coal assessment and mapping project: in Rao, P.D., and Wolff, E.N., eds., Focus on Alaska’s Coal ’86: Alaska Coal Conference, 3rd, Fairbanks, 1986, Proceedings, Fairbanks, University of Alaska Mineral Industry Research Laboratory Report 72, p. 183-197. Kirschner, C.E., and Lyon, C.A., 1973, Stratigraphic and tectonic development of Cook Inlet petroleum province, in Pither, M.G., ed., Arctic Geology: American Association of Petroleum Geologists Memoir 19, p. 396-407. 50 Magoon, L.B., Adkison, W.L., and Egbert, R.M., 1976, Map showing geology, wildcat wells, Tertiary plant fossil localities, K-Ar age dates, and petroleum operations, Cook Inlet area, Alaska: U.S. Geological Survey Geologic Investigations Map I-1019, scale 1: 250,000. Magoon, L.B., and Claypool, G.E., 1981, Petroleum geology of Cook Inlet basin---an exploration model: U.S. Geological Survey Open-file Report 79-548, 23 p. McGee, D.L. and O’Conner, K.M., 1975, Cook Inlet basin subsurface coal reserve study: Fairbanks, Alaska Division of Geological and Geophysical Surveys Open-file Report 74, 24 p. scale 1:500,000, 3 sheets. State of Alaska Division of Oil & Gas, 2003: The First Expansion of the Unit Area, Formation of the Falls Creek, Grassim Oskolkoff, and Susan Dionne Participating Areas, and Amendments to the Unit Agreement; Findings and Decision of the Director, Division of Oil and Gas, under delegation of authority from the Commissioner, State of Alaska, Department of Natural Resources, 18 p. 51 Notice of Reconsideration of Co. 701c February 9, 2018 Dear Commissioners, I request a reconsideration on your Jan. 22, 2018 ruling of CO 701c. First and foremost I would like to clear up any misconception about the spacing exception that you apparently have. I have been well aware for quit some time that being within the 3,000 foot radius of the spacing exception DOES NOT mean I'm to automatically be entitled royalties. It does however inform me that something is taking place within 3,000 feet of me. Nowhere do I recall seeing the word "Notification" on my Spacing Exception packet. So for you rule "Notification is just that, and nothing more. It does not imply, or establish, a 3,000-foot drainage radius for the Frances 1 well." Put the word "Notification" on my spacing exception packet and then you'll be valid on that part of your ruling. Now that I've been notified, I've used my diligence to investigate my correlative rights in respect to the well called Frances 1. Having ask for the Dec. 14, 2017 hearing to be postponed while I was just starting my medical care leading to my unexpected Dec. 5 open heart surgery, I was forced to testify telephonic. The first 6 weeks after surgery my heart was out of rhythm and there was a limit as to what I could do. These last couple of weeks I am adjusting to this new in rhythm heart and a breast bone that has healed nicely and the freedom of this thing called life with only a small portion of my thoughts always aware of what I've just been through. My hospital stay started Nov. 26, 2017 with a 2 AM ambulance ride to the ER. I'd been in Florida 20 hours and I'd brought double pneumonia to Orlando in me. 5 days in the ICU later and I could breath fairly well. It was during the ICU time that blood work showed that I had an Aortic valve that hadn't worked in 2 years. Between the 2 they didn't even know why I was alive at the time. After the ICU came the cardiac catheterization. That now told my surgical team that I needed 1 bovine Aortic valve and 1 right coronary artery bypass after they could get my body in shape for the Dec. 5 surgery. After a few days of more fresh blood and getting my medications right so that my blood pressure didn't drop 40 points every time I stood I was released Dec. 10 or 11. My total time in the Orlando hospital was 15 or 16 days straight. As I laid there worried about my life the whole time I also worried about this very important opportunity to testify at the hearing. Unable to concentrate, it was only in the couple of days prier to the hearing that, under duress, I managed to produce some form of testimony even though it was not as through as I had hoped to be prepared for. I meant it when I testified and I mean it even more now when I said " Being a litigant from the Exxon Valdez oil spill I am fully aware of my state government's cold deaf ears. This hearing only shows a new low that I truly didn't think obtainable." During the time of my medical crisis my thoughts in preparing to testify was to include Docket No. CO 14-029 [it became CO 701A]. Hilcorp's geologist, Dave Buthman, was sworn in on page 41, starting at line 15. Page 43, line 3, Direct Examination, line 4, Commissionaire Seamount, lines 5 through 11, [this is very important to me because this was important to the Commission] "One comment I would make is that sense the allocation is based solely on acreage some of this stuff may not be necessary in conservation order 701 of September 18th, 2014, but I still think it should be in there, I mean, I think it's important information for the record that people understand." When questioned by Commissioner Seamount on page 44, line 5, " And is the what, the hydrocarbon thickness is it similar throughout the sections and if I'm getting into confidentiality let me know?" The testimony of Mr. Buthman, starting on page 44, beginning at line 9, is of particular interest to my claim that trespass is being committed against me by Hilcorp stealing what is rightfully mine, in this case, my natural gas. The only thing homogeneous about the Falls Creek area is the hetrogenitity of the Beluga/Tyonek field all those thousands of feet down below the surface. Mr. Buthman testifies that the fluvial channels generally go northeast, southwest, "but they'll go wrapping around the east side of this Falls Creek pool and so we land with a hundred foot of gas sand at the Frances well whereas at the Falls Creek 1 redrill you have zero". Further, on page 46, beginning at line 6, Commissionaire Seamount ask about stratigraphic trapping. Starting at line 13 Mr. Buthman testifies, in part, lines 19 through 21, "it's true up at Falls Creek, the Frances well found a hundred foot gas sand, you know, half mile east of the Falls Creek well". Commissionaire Seamount, page 47, line 1," the strat traps have not been taken seriously. The, there's talk about Hilcorp's analysis of analog depositional systems suggest the mean channel width and you go into some detail about 500 feet and less than 15 percent exceeds 3,000 feet," ect. Mr. Buthman's testimony includes page 47, lines 13 through 17, "and Kasilof. We've actually gone through to measure them from the remote sensing satellite data and tabulated those as they made us do at Unocal, is there a size distribution, just field or sand size distribution so that's what we've done." In no.7 of your findings you rule " Accordingly, the coordinates for the northwestern corner of the Shaw Property —the portion of the property nearest to the gas-producing perforations in Frances 1— are 2,650 feet FNL and 1,320 feet FEL of Section 7. The perforations within Frances 1 lie about 2,750 feet from the nearest portion of the Shaw Property." I've got 3 State commissionaires along with Your Army of State professionals and Your Army of State lawyers, looking out for Your State Jobs picking out a well drilled in 1973 and Never tested, in this region of hetrogenitity telling me that I'm not supplying gas to the gas sand supplying the perforations of the Frances1 2,750 feet west of me, all the while " it's true up at Falls Creek, the Frances well found a hundred foot gas sand, you know, half a mile east of the Falls Creek well". One half of a mile is 2,640 feet. Your 2,750 feet minus Hilcorp's 2,640 feet equals 110 feet from my sub surface property line. In this hetrogenitity of a lenticular and discontinuous field a "dry hole", that is at least 43 years dead and about a mile north of me, does not constitute a good foundation when I'm 110 feet away from one hundred feet of gas sand helping to supply one of the greatest gas wells Alaska has seen in a long time. From July 2014 through Oct. 2016 the Frances 1 has produced 3,765,366 mcf. Times that by the value the state uses for royalty payment of Ninilchik Unit gas for October 2016, $6.82 [it varies monthly] and your trying to tell me that all that gas came from that tiny area? That's around 25 million dollars. I haven't checked sense Oct. of 2016 but if Frances 1 produced straight for another 17 months I think it would be safe to say 15 million dollars more could be added. 40 million dollars in 3 1/2 years, I'm sure that it's more. If it is true that you already have all the confidential data that Hilcorp uses then you'll be able to prove to me, in this contested hetrogenitity, a wall that encloses my sub surface boundaries, complete with a floor. As I testified in CO 14-029, I've seen maps several years ago that had the lands miles east of me called the Falls Creek Gas Reserve. I seem to recall depths of between 8,000 and 9,000 feet. That land mass moved down toward me, 8,000 feet a little east of me, 6,000 feet under my feet, Rising 2,000 feet in the space of approximately 1 1/2 miles. As you said, gas rises. The structure of the Beluga and Tyonek Formations is not analogous to a pond. The Beluga and Tyonek are comprised of discontinuous sandstone lenses deposited in braided to meandering rivers and streams that have stratigraphic trapping that have not been taken seriously. The Falls Creek Gas Reserve bleeds small amounts of gas throughout it's vastness to the upper elevations, replacing the gas in the braided meandering rivers and streams, and into the stratigraphic traps that have had their pressure released, always trying to replace what was lost until the valve is shut off. The natural flow of natural gas, poke a hole in the dome and out comes the gas. Your choice off depths only enforce my claim of being drained. The 220 true vertical feet deeper on the flank of the Ninilchik Anticline than the Frances 1 well means the gas flowing from the depths of the Falls Creek gas reserve have to flow UP, in part under my feet, to reach a depth of about 5,735 feet TVDSS within the Frances 1 well. Unless Hilcorp and the State have a rouge well capable of dodging sub surface property lines at your leisure. The AOGCC has stated in its decision that gas is located at the top of a structure and that water pushes the gas up from the sands down dip from the top of the structure. If the structure was created from a thick blanket of sand, the AOGCC’s description of where the gas is located in the Falls Creek area would be accurate. In that case, there would be a gas-water contact at a precise point down dip on the structure that would follow a line around the structure at that exact depth. Gas would be found above the line and water would be found below the line defined by that specific vertical depth around the structure. If this model was accurate, then the gas in the Falls Creek Participating Area could be produced from one well drilled at the very top of the structure. The water below the gas-water contact all around the structure would push the gas up toward the top of the blanket of sand – and eventually all of the gas would be produced from that single well. Hilcorp and the AOGCC knows that this is not how the gas is distributed in the Falls Creek area. Rather than a blanket of sand, the Beluga and Tyonek reservoirs were created millions of years ago by layer after layer of twisting and winding riverbeds creating many channels of sand, layered on top of one another with each layer of these riverbeds following unique meandering channels. These layers of deposits have created a three-dimensional puzzle of braided streambeds that wind around and meander; and that do not create reservoirs with predictable gas-water contacts at one particular depth down dip on the structure. For this reason, a well drilled far from the crest of the structure may penetrate a thick channel of gas-bearing sandstone and a well drilled higher on the structure may miss that string of sandstone entirely and/or may penetrate wet sandstone. You only need to look at the Frances #1 well – drilled far from the top of the structure and is a very productive gas well – to know that I am correct regarding this issue. The AOGCC’s decision is based, in part, on an assumption that there is a predictable depth of a gas- water contact in the Beluga and Tyonek formations, below which water is always found and above which gas is always found. Again, if the sandstone was a thick blanket of sand that was connected throughout the structure, this idea would make sense. But that is not the correct model to understand where gas may be found in the Falls Creek Beluga and Tyonek reservoirs. Using the AGOCC’s model of where gas and water are located, the AOGCC has decided that my property only has water under it because the Falls Creek 43-06 well is assumed by the AOGCC to have water in it. If you read the well file at the AOGCC you can see that 43-06 was drilled but was never tested. A core sample brought to the surface from the 43-06 well released gas at the surface. The FC 43-06 well may be wet or it may be gassy – again, it was never tested. Even if the assumption that the 43-06 is wet is a correct assumption, that does not prove that the sandstone river channel(s) from which the Frances #1 well is producing gas does not wind around to the SE and pass directly under my property. Any geologist who has studied the Beluga and Tyonek sands in the Cook Inlet basin knows that gas fields producing from these formations do not have a single gas-water contact found at the same depth throughout the field. A case in point well known to the AOGCC is the Beluga Gas Field. In one place, water may be found in the sand at a particular depth. In another well, gas may be found in a deeper layer of sandstone created by an older riverbed. In the AOGCC’s decision, the use of the FC 43-06 – a well that was never tested – as proof that there is no gas under my property is a geologically flawed argument. There are only two ways to state with reasonable certainty whether I am being drained by Hilcorp by production at the Frances #1 well. One way is for me to drill a well into the Beluga and Tyonek formations below my property. If you, the AOGCC Commissioners, actually believe your decision that my property just has water under it, then I would assume you would not require me to obtain any oil and gas permits to drill a water well on my land into the Beluga and Tyonek formations. You know, and I know that you would require permits because it is highly probable that I would hit gas. And hitting gas would support the argument that I am being drained. But drilling that well is inconsistent with the AOGCC’s statutes and regulations that require only one gas well per section of land to prevent waste. If every owner of a ten-acre parcel of mineral rights around Clam Gulch had to drill a well to prove he or she was being drained by Hilcorp, we would be back to the days of Spindletop in Texas. The fact that Spindletop became a pin cushion of oil wells drilled right next to each other is the reason that the Texas Railroad Commission became the first oil and gas conservation commission in the country. Drilling a well on each ten acre parcel of land is wasteful, would damage the reservoir, and must be prevented according to Alaska law. The AOGCC exists to make sure that I and every other owner of small pieces of mineral rights in my section of land do not drill a bunch of extra wells when one well is enough to produce the gas on one section of land. Drilling a well is the first way to see if I am being drained. The second way to determine if I am being drained is by using 3D seismic data and remote sensing satellite data to see where each channel of sand producing gas in the Frances #1 well meanders. If one or more channels of gas-producing sandstone from the ancient riverbeds meanders under my property or replenishes the stratigraphic trapping, I am being drained. If not, I am probably not being drained. Kevin Tabler offered to put a road in for me to sign the lease. It is well over $100,000 to put a road to my door. I'm sure he knows that I am. The importance of e-mailing and USPS a paper copy that day, deer or fishing charters. The recorded deceit on why it's good for me to sign from the very beginning. Keep me out of the Frances 1 and you keep me out of the PA. That's a lot of money for the State and Hilcorp to divide between yourselves, MY money. I'm sure that by now the State has meant few patent fee holders as diligent as I am. As a litigant of the Exxon Valdez Oil Spill who's life was so horribly altered, I HATE oil companies and I truly DO NOT TRUST my State Government, including you. The State will find a way to end your commissions and any future work for the State will come to an end because your loyalty was to the private individuals throughout the state and not the oil companies best interest, part of unbiased is not worrying about your job or standing with peers . Tony Knowles made public who's best interest was served when he won the gubernatorial election and immediately boarded a jet to fly to Texas to be sworn in as Alaska's governor because Alaska's soil wasn't good enough for him to stand on. I want to vomit every time I remember they named a trail after him. Rights in America and in Alaska are inalienable. Even the criminals who sit the bench in the Alaska Supreme Court have to be bias in protecting the patent fee correlative rights in order to protect their jobs, their prestige, the future tyranny Alaska will continue to be forced to live by. No means no, no matter how poorly the ruling is made. The gas in the braided meandering rivers and streams, and the stratigraphic traps is being replaced from the vastness of the Falls Creek Gas Reserve of which I'm a part of and next to "it's true up at Falls Creek, the Frances well found a hundred foot gas sand, you know, half mile east of the Falls Creek well". Another thing I'd meant to bring up at the hearing in my weakened state was that the commission had ordered Hilcorp, at the Nov. 14 hearing, to inform everyone on the spacing exception of the Dec. 14 hearing. I never got a notice, I'm on the list weather or not I'm the one requesting the hearing. I know that land has changed ownership sense the Spacing Exception was first mailed. Were the new owners informed? How do we tell? As a constitute I expect the highest order of performance in matters pertaining to my rights, nothing less. Having a chair commissionaire holding a law degree and once being elected by the people to run for Lt. Governor before being outested by his own party I don't think that is to much to ask for considering the importance of this matter. I call on you, the Commissionaires, charged with protecting my correlative rights, to review the lands next me and the Frances 1 and not a mile away. Under the tightest of scrutiny, prove to me that I an not supplying gas to the Frances 1. Even in qusi judicial there can be no doubt. The law is not man, it's the law. As I understand, you don't even have to reply to my request of reconsideration, but if you do electronically is preferred as I'm still out of state until my Dr.'s clear me to return home. Thank you, Don Shaw Clam Gulch 4 CAUTION: This email originated from outside the State of Alaska mail system. Do not click links or open attachments unless you recognize the sender and know the content is safe. From:Carlisle, Samantha J (OGC) To:Cody Terrell Cc:Roby, David S (OGC); Davies, Stephen F (OGC) Subject:RE: Application to Revise CO 701D - Pearl 9 Date:Thursday, October 13, 2022 12:30:00 PM Attachments:CO-22-012 Public Hearing Notice.pdf Don Shaw request for public hearing.pdf Hi Cody – Today the AOGCC received a request to hold this hearing. See attached hearing notice and request for a public hearing. Thank you, Samantha Carlisle AOGCC Special Assistant Alaska Oil and Gas Conservation Commission 333 West 7th Avenue Anchorage, AK 99501 (907) 793-1223 From: Cody Terrell <cterrell@hilcorp.com> Sent: Friday, September 23, 2022 8:25 AM To: Carlisle, Samantha J (OGC) <samantha.carlisle@alaska.gov> Cc: Roby, David S (OGC) <dave.roby@alaska.gov>; Davies, Stephen F (OGC) <steve.davies@alaska.gov> Subject: RE: Application to Revise CO 701D - Pearl 9 Samantha, See the list below with the tracking numbers for the certified mailing to landowners: ORDER SUMMARY SENT TO: Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf Arthur D. Reina, 240 Birch Banks Rd., Sagle ID 83860, United States CERTIFIED Tracking Information 92071902358909000017340254 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf Brandon Levi &Melissa Lancaster, P. O. Box 1397, Anchor Point AK 99556, United States CERTIFIED Tracking Information 92071902358909000017340261 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf Carolee Pickett, 5336 Holly Loop SE, Turner OR 97392, United States CERTIFIED Tracking Information 92071902358909000017340292 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf Cynthia L. Hatton, P. O. Box 2789, Homer AK 99603, United States CERTIFIED Tracking Information 92071902358909000017340278 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf Danny L. Martin, 2250 NW 114th Ave, Unit 1P, PTY-14423, Miami FL 33192, United States CERTIFIED Tracking Information 92071902358909000017340285 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf Darlene M. Rozak, 1134 S Magnolia Ave, Yuma AZ 85364, United States CERTIFIED Tracking Information 92071902358909000017340308 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf Darwin E. and Kaye A. Waldsmith Trust, PO Box 39309, Ninilchik AK 99639, United States CERTIFIED Tracking Information 92071902358909000017340315 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf David B. Charbonnier, 804 Madison Street, Petaluma CA 94952, United States CERTIFIED Tracking Information 92071902358909000017340346 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf David W. Smith, PO Box 39690, Ninilchik AK 99639, United States CERTIFIED Tracking Information 92071902358909000017340322 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf Edward Lee Maki, 505 Jamestown Ct, Frankfort KY 40601- 1341, United States CERTIFIED Tracking Information 92071902358909000017340339 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf Ember A. Jackinsky, aka joshua Jackinsky, 3700 Sharon Gagnon LN, Anchorage AK 99508-4656, United States CERTIFIED Tracking Information 92071902358909000017340353 Pearl No. 9 Spacing Exception Revision 9-16-Emily Long, PO Box 39187, Ninilchik AK 99639, United States CERTIFIED 22.pdf Tracking Information 92071902358909000017340377 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf Gailan B. Johnson, 6710 Elmore Road, Anchorage AK 99507, United States CERTIFIED Tracking Information 92071902358909000017340384 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf Gailan B. Johnson and Carol Lane-Johnson, PO Box 39108, Ninilchik AK 99639-0108, United States CERTIFIED Tracking Information 92071902358909000017340391 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf Gale R. Graham, 1668 Oro Dam Blvd W 67, Oroville CA 95965-4155, United States CERTIFIED Tracking Information 92071902358909000017340360 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf Gary Andes and Marna Andes, c/o Andes Pool Supply 23 Perry Ave, Biggs CA 95917, United States CERTIFIED Tracking Information 92071902358909000017340407 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf Gary Wade Jackinsky, P.O. Box 39127, Ninilchik AK 99639, United States CERTIFIED Tracking Information 92071902358909000017340414 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf George R. Maki, Jr., 681 Cassidy Drive, Durango CO 81303, United States CERTIFIED Tracking Information 92071902358909000017340452 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf George S. Lindholm, P. O. Box 332, Rochester WA 98579, United States CERTIFIED Tracking Information 92071902358909000017340421 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf Glen Thomas and Dianne Thomas, PO Box 1083, Moore Haven FL 33471, United States CERTIFIED Tracking Information 92071902358909000017340445 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf Glenn R. Edwards and Carolyn M. Edwards, PO Box 39064, Ninilchik AK 99639, United States CERTIFIED Tracking Information 92071902358909000017340438 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf Gloria Ann Ropelato, aka Gloria Ann Millet 3954 W. 1400 S., Ogden UT 84401-9062, United States CERTIFIED Tracking Information 92071902358909000017340469 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf James D. and Diane S. Elledge, 20504 Philadelphia Way, Eagle River AK 99577-8496, United States CERTIFIED Tracking Information 92071902358909000017340476 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf Janusz Naumiuk and Taisa Naumiuk, 3 Elmwood Terrace, Edison NJ 08817, United States CERTIFIED Tracking Information 92071902358909000017340483 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf Jason V. Jackinsky, PO Box 744, Palmer AK 99645-0744, United States CERTIFIED Tracking Information 92071902358909000017340506 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf Jennifer Long, PO Box 39187, Ninilchik AK 99639, United States CERTIFIED Tracking Information 92071902358909000017340490 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf John D. McCombs and Deidre E. McCombs, PO Box 39087, Ninilchik AK 99639, United States CERTIFIED Tracking Information 92071902358909000017340513 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf John L. and Nancy E. Stengl, North 12003 Cedar Road, Birnamwood WI 54414-8737, United States CERTIFIED Tracking Information 92071902358909000017340520 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf Joy Ward, P. O. Box 3414, Kenai AK 99611, United States CERTIFIED Tracking Information 92071902358909000017340551 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf Judith Ballentine, PO Box 9, Veguita NM 87062, United States CERTIFIED Tracking Information 92071902358909000017340537 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf Kenneth E. and Brenda M. Noonan, h/w, 1 Kollar Road, Willington CT 06279, United States CERTIFIED Tracking Information 92071902358909000017340544 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf Larry M. Rozak, PO Box 1179, Homer AK 99603, United States CERTIFIED Tracking Information 92071902358909000017340568 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf Lela Young, aka Lela Joye Thatcher, 2020 Muldoon Rd, Unit 241, Anchorage AK 99504-3685, United States CERTIFIED Tracking Information 92071902358909000017340575 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf Mathew Byler, PO Box 39308, Ninilchik AK 99639, United States CERTIFIED Tracking Information 92071902358909000017340582 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf McKibben Jackinsky, PO Box 39187, Ninilchik AK 99639, United States CERTIFIED Tracking Information 92071902358909000017340599 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf Mercy A. Shelton, PO Box 2260, Homer AK 99603, United States CERTIFIED Tracking Information 92071902358909000017340605 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf Michael Roy Smith, 1121 Burnt Ridge Road, Troy ID 83871, United States CERTIFIED Tracking Information 92071902358909000017340612 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf Michael S. and Cheryl B. Sutton, PO Box 39214, Ninilchik AK 99639, United States CERTIFIED Tracking Information 92071902358909000017340629 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf Ninilchik Point View LLC, PO Box 39309, Ninilchik AK 99639, United States CERTIFIED Tracking Information 92071902358909000017340636 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf No More FYI, LLC, c/o Shari Wulf 10672 Kenai Spur Hwy, Ste 112, PMB 289, Kenai AK 99611, United States CERTIFIED Tracking Information 92071902358909000017340643 Pearl No. 9 Spacing Patrick L. Pearl, 2705 Range Avenue, Apt 109, Santa Rosa Exception Revision 9-16- 22.pdf CA 95403, United States CERTIFIED Tracking Information 92071902358909000017340650 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf Redford Johnathan Turner, IV, P. O. Box 141, Clam Gulch AK 99568, United States CERTIFIED Tracking Information 92071902358909000017340667 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf Risa A. Jackinsky, 4014 Ben Walters Lane, Apt. C8, Homer AK 99603, United States CERTIFIED Tracking Information 92071902358909000017340674 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf Robert Flygenring and Cheryl King, 926 W 80TH AVE, Anchorage AK 99518, United States CERTIFIED Tracking Information 92071902358909000017340681 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf Ronald Ray Albright, 2371 E Ventura Blvd, SPC 68, Oxnard CA 93036-7927, United States CERTIFIED Tracking Information 92071902358909000017340698 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf Sharon Culhane Living Trust, 5331 Bishops Castle Circle, Anchorage AK 99516, United States CERTIFIED Tracking Information 92071902358909000017340704 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf Shawn M. and Myrle Wilson, 8312 N Highlander Loop, Palmer AK 99645-8016, United States CERTIFIED Tracking Information 92071902358909000017340711 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf Shawn W. Jackinsky, Jr., PO Box 15282, Fritz Creek AK 99603, United States CERTIFIED Tracking Information 92071902358909000017340728 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf State of Alaska, DNR, ATTN: Units Section 550 West 7th Avenue, Ste. 1100, Anchorage AK 99501, United States CERTIFIED Tracking Information 92071902358909000017340735 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf Stephen M. and Theresa Wackowski, 103 Ryans Way, Yorktown VA 23693, United States CERTIFIED Tracking Information 92071902358909000017340742 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf Stephen Wackowski and Thomas Brady, 103 Ryans Way, Yorktown VA 23693, United States CERTIFIED Tracking Information 92071902358909000017340759 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf Stephen Walter Jackinsky, 138 NE 106 St., Miami FL 33138, United States CERTIFIED Tracking Information 92071902358909000017340766 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf Thomas James and Deborah Ann Bandelow, 8000 Little Dipper Ave, Anchorage AK 99504, United States CERTIFIED Tracking Information 92071902358909000017340216 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf Thomas P. Brady, 7760 McClure Circle, Anchorage AK 99507-6231, United States CERTIFIED Tracking Information 92071902358909000017340230 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf Walter L. Wilson, 91 Good Times Drive, Las Cruces NM 88005, United States CERTIFIED Tracking Information 92071902358909000017340223 Pearl No. 9 Spacing Exception Revision 9-16- 22.pdf Wendy Jacqueline Seaman, 12 Haven Dr., Petaluma CA 94952, United States CERTIFIED Tracking Information 92071902358909000017340247 Regards, Cody T. Terrell Landman Hilcorp Alaska, LLC Direct: 907-777-8432 Cell: 713-870-4532 This email may contain confidential and / or privileged information and is intended for the recipient(s) only. In the event you receive this message in error, please notify me and delete the message. From: Cody Terrell Sent: Friday, September 16, 2022 10:07 AM To: Carlisle, Samantha J (CED) <samantha.carlisle@alaska.gov> Cc: Roby, David S (CED) <dave.roby@alaska.gov>; Davies, Stephen F (CED) <steve.davies@alaska.gov> Subject: Application to Revise CO 701D - Pearl 9 Hi Samantha, Please see Hilcorp’s application to revise CO 701D, changing the well location of the Pearl No. 9 well within the Ninilchik Unit. Notice to landowners are being sent out today. Once I receive the certified mailing tracking numbers I will forward them to you. Thank you. Regards, Cody T. Terrell | Landman | Hilcorp Alaska, LLC O: 907-777-8432 | C: 713-870-4532 | cterrell@hilcorp.com 3800 Centerpoint Dr., Suite 1400 | Anchorage | Alaska | 99503 This email may contain confidential and / or privileged information and is intended for the recipient(s) only. In the event you receive this message in error, please notify me and delete the message. The information contained in this email message is confidential and may be legally privileged and is intended only for the use of the individual or entity named above. If you are not an intended recipient or if you have received this message in error, you are hereby notified that any dissemination, distribution, or copy of this email is strictly prohibited. If you have received this email in error, pleaseimmediately notify us by return email or telephone if the sender's phone number is listed above, then promptly and permanently deletethis message. While all reasonable care has been taken to avoid the transmission of viruses, it is the responsibility of the recipient to ensure that theonward transmission, opening, or use of this message and any attachments will not adversely affect its systems or data. No responsibilityis accepted by the company in this regard and the recipient should carry out such virus and other checks as it considers appropriate. 3 CAUTION: This email originated from outside the State of Alaska mail system. Do not click links or open attachments unless you recognize the sender and know the content is safe. From:don shaw To:Carlisle, Samantha J (OGC) Subject:Docket Number: CO-22-012 Date:Thursday, October 13, 2022 9:31:30 AM You don't often get email from shawmanseafoods@yahoo.com. Learn why this is important Hello, I would like to request a public hearing on this matter. Thank You, Don Shaw 2 Notice of Public Hearing STATE OF ALASKA ALASKA OIL AND GAS CONSERVATION COMMISSION RE: Docket Number: CO-22-012 Hilcorp Alaska, LLC’s Spacing Exception to drill the Pearl 9 well in the Pearl Undefined Gas Pool and the Ninilchik Beluga-Tyonek Gas Pool, Cook Inlet Basin, Alaska Hilcorp Alaska, LLC (Hilcorp), by letter dated September 16, 2022, submitted a revision request to the Alaska Oil and Gas Conservation Commission (AOGCC) to revise Conservation Order 701D (CO 701D), allowing Hilcorp to complete, test, and produce the Pearl 9 well in the Pearl Undefined Gas Pool within 1,500 feet of a property line where the owners and landowners are not the same on both sides of the line and in the Ninilchik Beluga/Tyonek Gas Pool within 1,500 feet from the exterior boundary of the Affected Area of Conservation Order 701C (CO 701 C), pursuant to 20 AAC 25.055 and Rule 3 of CO 701C. Well spacing regulations protect the oil and gas rights of adjacent landowners and maximize resource recovery by establishing default limits on how close, under the land's surface, oil and gas wells can be to each other and to property lines where ownership changes hands. These limits are set forth in a regulation, 20 AAC 25.055. Operators must abide by the default well spacing limits (referred to as statewide spacing requirements) unless they apply for, and obtain, an exception to those limits. Although exceptions to the default well spacing requirements are not unusual, AOGCC carefully evaluates each application, and typically grants them only when actual geologic conditions demonstrate that the proposed subsurface location of a well is necessary to reach otherwise unreachable oil or gas and that both the rights of adjacent landowners and underground drinking water can be protected. As a general matter, AOGCC does not have extensive authority over surface impacts such as noise, emissions, or construction. This notice does not contain all the information filed by Hilcorp. You may obtain more information about this filing by contacting the AOGCC’s Special Assistant, Samantha Carlisle, at (907) 793-1223 or samantha.carlisle@alaska.gov. A public hearing on the matter has been tentatively scheduled for November 3, 2022 at 10:00 a.m. The hearing, which may be changed to full virtual, if necessary, will be held in the AOGCC hearing room located at 333 West 7th Avenue, Anchorage, AK 99501. The audio call-in information is: (907) 202-7104 Conference ID: 458 918 175#. Anyone who wishes to participate remotely using MS Teams video conference should contact Ms. Carlisle at least two business days before the scheduled public hearing to request an invitation for MS Teams. To request that the tentatively scheduled hearing be held, a written request must be filed with the AOGCC no later than 4:30 p.m. on October 13. 2022. If a request for a hearing is not timely filed, the AOGCC may issue an order without a hearing. To learn if the AOGCC will hold the hearing, call (907) 793-1223 after October 13, 2022. In additions, written comments regarding this application may be submitted to the AOGCC at 333 West 7th Avenue, Anchorage, AK 99501 or samantha.carlisle@alaska.gov. Comments must be received no later than 4:30 p.m. on November 2, 2022, except that if a hearing is held, comments must be received no later than the conclusion of the November 3, 2022 hearing If, because of a disability, special accommodations may be need ed to comment or attend the hearing, contact Samantha Carlisle at (907) 793-1223, no later than October 27, 2022. Jessie L. Chmielowski Commissioner Jessie L. Chmielowski Digitally signed by Jessie L. Chmielowski Date: 2022.09.28 15:23:31 -08'00' Adam Garrigus being first duly sworn on oath deposes and says that she is a representative of the Anchorage Daily News, a daily newspaper. That said newspaper has been approved by the Third Judicial Court, Anchorage, Alaska, and it now and has been published in the English language continually as a daily newspaper in Anchorage, Alaska, and it is now and during all said time was printed in an office maintained at the aforesaid place of publication of said news- paper. That the annexed is a copy of an adver- tisement as it was published in regular issues (and not in supplemental form) of said news- paper on AFFIDAVIT OF PUBLICATION ______________________________________ Notary Public in and for The State of Alaska. Third Division Anchorage, Alaska MY COMMISSION EXPIRES ______________________________________ 10/02/2022 and that such newspaper was regularly distrib- uted to its subscribers during all of said period. That the full amount of the fee charged for the foregoing publication is not in excess of the rate charged private individuals. Signed________________________________ Subscribed and sworn to before me this 3rd day of October 2022. Account #: 100869 ST OF AK/AK OIL AND GAS CONSERVATION COMMISSION 333 W. 7TH AVE STE 100, ANCHORAGE, AK 99501 Order #: W0033291 Cost: $387.5 Notice of Public HearingSTATE OF ALASKAALASKA OIL AND GAS CONSERVATION COMMISSION RE: Docket Number: CO-22-012Hilcorp Alaska, LLC’s Spacing Exception to drill the Pearl 9 well in the Pearl Undefined GasPool and the Ninilchik Beluga-Tyonek Gas Pool, Cook Inlet Basin, Alaska Hilcorp Alaska, LLC (Hilcorp), by letter dated September 16, 2022, submitted a revision request to the Alaska Oil and Gas Conservation Commission (AOGCC) to revise Conservation Order 701D (CO 701D), allowing Hilcorp to complete, test, and produce the Pearl 9 well in the Pearl Undefined Gas Pool within 1,500 feet of a property line where the owners and landowners are not the same on both sides of the line and in the Ninilchik Beluga/Tyonek Gas Pool within 1,500 feet from the exterior boundary of the Affected Area of Conservation Order 701C (CO 701 C), pursuant to 20 AAC 25.055 and Rule 3 of CO 701C. Well spacing regulations protect the oil and gas rights of adjacent landowners and maximize resource recovery by establishing default limits on how close, under the land’s surface, oil and gas wells can be to each other and to property lines where ownership changes hands. These limits are set forth in a regulation, 20 AAC 25.055. Operators must abide by the default well spacing limits (referred to as statewide spacing requirements) unless they apply for, and obtain, an exception to those limits. Although exceptions to the default well spacing requirements are not unusual, AOGCC carefully evaluates each application, and typically grants them only when actual geologic conditions demonstrate that the proposed subsurface location of a well is necessary to reach otherwise unreachable oil or gas and that both the rights of adjacent landowners and underground drinking water can be protected. As a general matter, AOGCC does not have extensive authority over surface impacts such as noise, emissions, or construction. This notice does not contain all the information filed by Hilcorp. You may obtain more information about this filing by contacting the AOGCC’s Special Assistant, Samantha Carlisle, at (907) 793- 1223 or samantha.carlisle@alaska.gov. A public hearing on the matter has been tentatively scheduled for November 3, 2022 at 10:00 a.m. The hearing, which may be changed to full virtual, if necessary, will be held in the AOGCC hearing room located at 333 West 7th Avenue, Anchorage, AK 99501. The audio call-in information is: (907) 202-7104 Conference ID: 458 918 175#. Anyone who wishes to participate remotely using MS Teams video conference should contact Ms. Carlisle at least two business days before the scheduled public hearing to request an invitation for MS Teams. To request that the tentatively scheduled hearing be held, a written request must be filed with the AOGCC no later than 4:30 p.m. on October 13. 2022. If a request for a hearing is not timely filed, the AOGCC may issue an order without a hearing. To learn if the AOGCC will hold the hearing, call (907) 793-1223 after October 13, 2022. In additions, written comments regarding this application may be submitted to the AOGCC at 333 West 7th Avenue, Anchorage, AK 99501 or samantha.carlisle@alaska.gov. Comments must be received no later than 4:30 p.m. on November 2, 2022, except that if a hearing is held, comments must be received no later than the conclusion of the November 3, 2022 hearing If, because of a disability, special accommodations may be needed to comment or attend the hearing, contact Samantha Carlisle at (907) 793-1223, no later than October 27, 2022. Jessie L. ChmielowskiCommissioner Pub: Oct. 2, 2022 STATE OF ALASKA THIRD JUDICIAL DISTRICT 2024-07-14 Document Ref: XXTLZ-RVYWJ-EUVRS-JBKZA Page 4 of 48 From:Carlisle, Samantha J (OGC) To:AOGCC_Public_Notices Subject:[AOGCC_Public_Notices] Public Hearing Notice (Spacing Exception, Pearl 9) Date:Thursday, September 29, 2022 8:46:12 AM Attachments:CO-22-012 Public Hearing Notice.pdf Docket Number: CO-22-012 Hilcorp Alaska, LLC’s Spacing Exception to drill the Pearl 9 well in the Pearl Undefined Gas Pool and the Ninilchik Beluga-Tyonek Gas Pool, Cook Inlet Basin, Alaska Samantha Carlisle AOGCC Special Assistant Alaska Oil and Gas Conservation Commission 333 West 7th Avenue Anchorage, AK 99501 (907) 793-1223 __________________________________ List Name: AOGCC_Public_Notices@list.state.ak.us You subscribed as: samantha.carlisle@alaska.gov Unsubscribe at: https://list.state.ak.us/mailman/options/aogcc_public_notices/samantha.carlisle%40alaska.gov Bernie Karl K&K Recycling Inc. P.O. Box 58055 Fairbanks, AK 99711 mailed 9/29/22 1 By Samantha Carlisle at 10:10 am, Sep 16, 2022 1 Carlisle, Samantha J (OGC) From:Cody Terrell <cterrell@hilcorp.com> Sent:Friday, September 23, 2022 8:25 AM To:Carlisle, Samantha J (OGC) Cc:Roby, David S (OGC); Davies, Stephen F (OGC) Subject:RE: Application to Revise CO 701D - Pearl 9 Samantha, See the list below with the tracking numbers for the certified mailing to landowners: ORDER SUMMARY SENT TO: Pearl No. 9 Spacing Exception Revision 9-16-22.pdf Arthur D. Reina, 240 Birch Banks Rd., Sagle ID 83860, United States CERTIFIED Tracking Information 92071902358909000017340254 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf Brandon Levi &Melissa Lancaster, P. O. Box 1397, Anchor Point AK 99556, United States CERTIFIED Tracking Information 92071902358909000017340261 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf Carolee Pickett, 5336 Holly Loop SE, Turner OR 97392, United States CERTIFIED Tracking Information 92071902358909000017340292 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf Cynthia L. Hatton, P. O. Box 2789, Homer AK 99603, United States CERTIFIED Tracking Information 92071902358909000017340278 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf Danny L. Martin, 2250 NW 114th Ave, Unit 1P, PTY-14423, Miami FL 33192, United States CERTIFIED Tracking Information 92071902358909000017340285 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf Darlene M. Rozak, 1134 S Magnolia Ave, Yuma AZ 85364, United States CERTIFIED Tracking Information 92071902358909000017340308 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf Darwin E. and Kaye A. Waldsmith Trust, PO Box 39309, Ninilchik AK 99639, United States CERTIFIED Tracking Information 92071902358909000017340315 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf David B. Charbonnier, 804 Madison Street, Petaluma CA 94952, United States CERTIFIED CAUTION: This email originated from outside the State of Alaska mail system. Do not click links or open attachments unless you recognize the sender and know the content is safe. 2 Tracking Information 92071902358909000017340346 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf David W. Smith, PO Box 39690, Ninilchik AK 99639, United States CERTIFIED Tracking Information 92071902358909000017340322 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf Edward Lee Maki, 505 Jamestown Ct, Frankfort KY 40601-1341, United States CERTIFIED Tracking Information 92071902358909000017340339 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf Ember A. Jackinsky, aka joshua Jackinsky, 3700 Sharon Gagnon LN, Anchorage AK 99508-4656, United States CERTIFIED Tracking Information 92071902358909000017340353 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf Emily Long, PO Box 39187, Ninilchik AK 99639, United States CERTIFIED Tracking Information 92071902358909000017340377 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf Gailan B. Johnson, 6710 Elmore Road, Anchorage AK 99507, United States CERTIFIED Tracking Information 92071902358909000017340384 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf Gailan B. Johnson and Carol Lane-Johnson, PO Box 39108, Ninilchik AK 99639-0108, United States CERTIFIED Tracking Information 92071902358909000017340391 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf Gale R. Graham, 1668 Oro Dam Blvd W 67, Oroville CA 95965-4155, United States CERTIFIED Tracking Information 92071902358909000017340360 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf Gary Andes and Marna Andes, c/o Andes Pool Supply 23 Perry Ave, Biggs CA 95917, United States CERTIFIED Tracking Information 92071902358909000017340407 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf Gary Wade Jackinsky, P.O. Box 39127, Ninilchik AK 99639, United States CERTIFIED Tracking Information 92071902358909000017340414 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf George R. Maki, Jr., 681 Cassidy Drive, Durango CO 81303, United States CERTIFIED Tracking Information 92071902358909000017340452 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf George S. Lindholm, P. O. Box 332, Rochester WA 98579, United States CERTIFIED Tracking Information 92071902358909000017340421 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf Glen Thomas and Dianne Thomas, PO Box 1083, Moore Haven FL 33471, United States CERTIFIED 3 Tracking Information 92071902358909000017340445 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf Glenn R. Edwards and Carolyn M. Edwards, PO Box 39064, Ninilchik AK 99639, United States CERTIFIED Tracking Information 92071902358909000017340438 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf Gloria Ann Ropelato, aka Gloria Ann Millet 3954 W. 1400 S., Ogden UT 84401-9062, United States CERTIFIED Tracking Information 92071902358909000017340469 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf James D. and Diane S. Elledge, 20504 Philadelphia Way, Eagle River AK 99577-8496, United States CERTIFIED Tracking Information 92071902358909000017340476 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf Janusz Naumiuk and Taisa Naumiuk, 3 Elmwood Terrace, Edison NJ 08817, United States CERTIFIED Tracking Information 92071902358909000017340483 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf Jason V. Jackinsky, PO Box 744, Palmer AK 99645-0744, United States CERTIFIED Tracking Information 92071902358909000017340506 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf Jennifer Long, PO Box 39187, Ninilchik AK 99639, United States CERTIFIED Tracking Information 92071902358909000017340490 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf John D. McCombs and Deidre E. McCombs, PO Box 39087, Ninilchik AK 99639, United States CERTIFIED Tracking Information 92071902358909000017340513 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf John L. and Nancy E. Stengl, North 12003 Cedar Road, Birnamwood WI 54414-8737, United States CERTIFIED Tracking Information 92071902358909000017340520 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf Joy Ward, P. O. Box 3414, Kenai AK 99611, United States CERTIFIED Tracking Information 92071902358909000017340551 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf Judith Ballentine, PO Box 9, Veguita NM 87062, United States CERTIFIED Tracking Information 92071902358909000017340537 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf Kenneth E. and Brenda M. Noonan, h/w, 1 Kollar Road, Willington CT 06279, United States CERTIFIED Tracking Information 92071902358909000017340544 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf Larry M. Rozak, PO Box 1179, Homer AK 99603, United States CERTIFIED 4 Tracking Information 92071902358909000017340568 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf Lela Young, aka Lela Joye Thatcher, 2020 Muldoon Rd, Unit 241, Anchorage AK 99504-3685, United States CERTIFIED Tracking Information 92071902358909000017340575 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf Mathew Byler, PO Box 39308, Ninilchik AK 99639, United States CERTIFIED Tracking Information 92071902358909000017340582 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf McKibben Jackinsky, PO Box 39187, Ninilchik AK 99639, United States CERTIFIED Tracking Information 92071902358909000017340599 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf Mercy A. Shelton, PO Box 2260, Homer AK 99603, United States CERTIFIED Tracking Information 92071902358909000017340605 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf Michael Roy Smith, 1121 Burnt Ridge Road, Troy ID 83871, United States CERTIFIED Tracking Information 92071902358909000017340612 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf Michael S. and Cheryl B. Sutton, PO Box 39214, Ninilchik AK 99639, United States CERTIFIED Tracking Information 92071902358909000017340629 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf Ninilchik Point View LLC, PO Box 39309, Ninilchik AK 99639, United States CERTIFIED Tracking Information 92071902358909000017340636 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf No More FYI, LLC, c/o Shari Wulf 10672 Kenai Spur Hwy, Ste 112, PMB 289, Kenai AK 99611, United States CERTIFIED Tracking Information 92071902358909000017340643 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf Patrick L. Pearl, 2705 Range Avenue, Apt 109, Santa Rosa CA 95403, United States CERTIFIED Tracking Information 92071902358909000017340650 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf Redford Johnathan Turner, IV, P. O. Box 141, Clam Gulch AK 99568, United States CERTIFIED Tracking Information 92071902358909000017340667 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf Risa A. Jackinsky, 4014 Ben Walters Lane, Apt. C8, Homer AK 99603, United States CERTIFIED Tracking Information 92071902358909000017340674 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf Robert Flygenring and Cheryl King, 926 W 80TH AVE, Anchorage AK 99518, United States CERTIFIED 5 Tracking Information 92071902358909000017340681 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf Ronald Ray Albright, 2371 E Ventura Blvd, SPC 68, Oxnard CA 93036- 7927, United States CERTIFIED Tracking Information 92071902358909000017340698 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf Sharon Culhane Living Trust, 5331 Bishops Castle Circle, Anchorage AK 99516, United States CERTIFIED Tracking Information 92071902358909000017340704 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf Shawn M. and Myrle Wilson, 8312 N Highlander Loop, Palmer AK 99645- 8016, United States CERTIFIED Tracking Information 92071902358909000017340711 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf Shawn W. Jackinsky, Jr., PO Box 15282, Fritz Creek AK 99603, United States CERTIFIED Tracking Information 92071902358909000017340728 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf State of Alaska, DNR, ATTN: Units Section 550 West 7th Avenue, Ste. 1100, Anchorage AK 99501, United States CERTIFIED Tracking Information 92071902358909000017340735 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf Stephen M. and Theresa Wackowski, 103 Ryans Way, Yorktown VA 23693, United States CERTIFIED Tracking Information 92071902358909000017340742 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf Stephen Wackowski and Thomas Brady, 103 Ryans Way, Yorktown VA 23693, United States CERTIFIED Tracking Information 92071902358909000017340759 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf Stephen Walter Jackinsky, 138 NE 106 St., Miami FL 33138, United States CERTIFIED Tracking Information 92071902358909000017340766 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf Thomas James and Deborah Ann Bandelow, 8000 Little Dipper Ave, Anchorage AK 99504, United States CERTIFIED Tracking Information 92071902358909000017340216 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf Thomas P. Brady, 7760 McClure Circle, Anchorage AK 99507-6231, United States CERTIFIED Tracking Information 92071902358909000017340230 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf Walter L. Wilson, 91 Good Times Drive, Las Cruces NM 88005, United States CERTIFIED Tracking Information 92071902358909000017340223 Pearl No. 9 Spacing Exception Revision 9-16-22.pdf Wendy Jacqueline Seaman, 12 Haven Dr., Petaluma CA 94952, United States CERTIFIED 6 Tracking Information 92071902358909000017340247 Regards, Cody T. Terrell Landman Hilcorp Alaska, LLC Direct: 907-777-8432 Cell: 713-870-4532 This email may contain confidential and / or privileged information and is intended for the recipient(s) only. In the event you receive this message in error, please notify me and delete the message. From: Cody Terrell Sent: Friday, September 16, 2022 10:07 AM To: Carlisle, Samantha J (CED) <samantha.carlisle@alaska.gov> Cc: Roby, David S (CED) <dave.roby@alaska.gov>; Davies, Stephen F (CED) <steve.davies@alaska.gov> Subject: Application to Revise CO 701D ‐ Pearl 9 Hi Samantha, Please see Hilcorp’s application to revise CO 701D, changing the well location of the Pearl No. 9 well within the Ninilchik Unit. Notice to landowners are being sent out today. Once I receive the certified mailing tracking numbers I will forward them to you. Thank you. Regards, Cody T. Terrell | Landman | Hilcorp Alaska, LLC O: 907-777-8432 | C: 713-870-4532 | cterrell@hilcorp.com 3800 Centerpoint Dr., Suite 1400 | Anchorage | Alaska | 99503 This email may contain confidential and / or privileged information and is intended for the recipient(s) only. In the event you receive this message in error, please notify me and delete the message. 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