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202-177
1 4 ALASKA SEAN PARNELL, GOVERNOR AL"KA OIL AND GALS � 333 W. 7th AVENUE, SUITE 100 CONSERVATION COMUSSION ANCHORAGE, ALASKA 99501-3539 PHONE (907) 279-1433 FAX (907) 276-7542 Anita Dominguez Risk Insurance Assistant Pioneer Natural Resources USA, Inc. 5205 North O'Conner Blvd., Suite 900 Irving, TX 75039 Dear Ms. Dominguez: September 10, 2009 i OCT 0 8 2DIC,. a0a-177 I am responding to your email of February 16, 2009 in which you request release of Evergreen Resources, Inc.'s (Evergreen) Surety Bond No. RLB0004711, with RLI Insurance Company as surety. The surety bond you refer to is issued in favor of the Alaska Oil and Gas Conservation Commission (Commission) and is required to remain in effect until the abandonment of all wells covered by it and until the Commission approves final clearance of the locations (Title 20 Chapter 25 Section 025 Paragraph (c) of the Alaska Administrative Code). Commission records indicate that Evergreen drilled fourteen exploratory or stratigraphic test wells in Alaska: Baranof No. 4, Bering No. 3, Cook No. 1, Cornhusker No. 4, D.L. Smith No. 1, G. and J. Stromberg No. 2, Houston Pit No. 1, Kashwitna Lake No. 1, Little Su No. 1, Lowell No. 2, R.L. Smith No. 3, Sheep Creek No. 1, Slats No. 1, and Willow Fishhook No. 1. All of these wells have been plugged and abandoned, and Commission inspections showed all locations to be in compliance with 20 AAC 25.170, "Onshore Location Clearance." The Commission requires no further work on the wells or their locations. Therefore the Commission, in response to your request, releases RLI Insurance Company from any and all liability under Surety Bond No. RLB0004711. However, Pioneer Natural Resources Alaska, Inc., the survivor company to Evergreen, remains liable if any problems were to occur in the future with any of these wells. A photocopy of Surety Bond No. RLB0004711 will be retained in the Commission's records, and the originals will be returned to you as attachments to this letter. If there are any questions, please contact Mr. Steve Davies at (907) 793-1224. Sincerely, Daniel T. Seamount, Jr. Chairman cc: Bond file 402-44 MEMORANDUM State of Alaska Alaska Oil and Gas Conservation Commission TO: Jim Regg 1<< DATE; May 8, 2005 P. I. Supervisor (� FROM: John Spaulding, SUBJECT: Location Clearances Petroleum Inspector Pioneer Unit Pioneer Natural Res. ?1T) 7 The following wells in the Pioneer Unit were inspected for location clearances: Bering 03 PTD: 202-177 ✓Baranoff 04 PTD: 202-178 Cook 01 PTD: 202180 Lowell 02 PTD: 202-179 1702-14CC PTD: 199-065 1702-15DA WDW PTD 199-064 1702-15DD PTD: 199-066 Cornhusker 04 PTD: 202-181 RL Smith 03 PTD: 202-182 DL Smith 01 PTD: 202-184 Stromberg 02 PTD: 202-183"mod BLT 01 PTD: 199-068 All locations were found to be in excellent shape, well graded with some small amounts of debris. I requested that the debris be cleaned up and Joe Polya Pioneer Nat. Resources rep. agreed. He will inform as to when the final cleanup has been made so that I may make one last pass over the locations. SUMMARY: I found all locations in very good condition with small amounts of tidying up to be done. Attachments: photos on CD NON -CONFIDENTIAL DATA SUBMITTAL COMPLIANCE REPORT 12/11/2006 Permit to Drill 2021770 Well Name/No. BERING 3 Operator PIONEER NATURAL RESOURCES AL API No. 50-009-20019-00-00 MD 3750/ TVD 3750 t Completion Date 5/7/2003 Completion Status 1-CBNG Current Status P&A UIC N REQUIRED INFORMATION Mud Log No Samples No Directional Survey No DATA INFORMATION Types Electric or Other Logs Run: DNL, IL, GR, (data taken from Logs Portion of Master Well Data Maint Well Log Information: Log/ Electr Data Digital Dataset Log Log Run Interval OH / X-D C Las Lug C Log ILOT Log iLag P9 "9— 12844 Induction/Resistivity Induction/Resistivity Density Cement Evaluation Mud Log Gamma Ray Neutron C 1� ",yt (t � oY4. t-- -%, VVV11 NV1tl5/J4111P1Vb mFVrinauvn: OTH Blu 1 OTH Blu 2 OTH Blu 1 OTH Blu 5 Col 5 Blu 1 5 Blu 2 5 Blu 1 Inclination Survey 374 3747 Open 6/25/2004 Open Hole Suite 390 3749 6/25/2004 DUAL INDUCTION GAMMA RAY, DSN 1265 390 3749 6/25/2004 COMPENSATED DENSITY NEUTRON LOG, DSN 12656 0 3682 Case 6/25/2004 DUAL SPACED CEMENT BOND GAMMA RAY, DS 12656 420 3750 6/25/2004 MUD, ROP, DSN 12656 420 3750 2/16/2005 Columbine Logging, Inc 390 3749 2/6/2005 Dual Induction GR/Patterson 390 3749 2/16/2005 Compensated Density Neutron Log/Patterson 0 3682 2/16/2005 Dual Spaced Cement Sample Interval Set Name Start Stop Sent Received Number Comments DATA SUBMITTAL COMPLIANCE REPORT 12/11/2006 Permit to Drill 2021770 Well Name/No. BERING 3 MD 3750 ND 3750 ADDITIONAL INFORMATION Well Cored? Y / N Chips Received? -Y-rW Analysis IYF� Received? Comments Compliance Reviewed By: Completion Date 5/7/2003 Operator PIONEER NATURAL RESOURCES AL API No. 50-009-20019-00-00 Completion Status 1-CBNG Current Status P&A UIC N Daily History Received? ( 6N Formation Tops �/ N Date: R'ECEIVE .. .% STATE OF ALASKA _ jQQ ALASKA MAND GAS CONSERVATION COMMISSIO " OCT I `, WELL COMPLETION OR RECOMPLETION REPORTI ANC . camoliss o 1a. Well Status: Oil Gas Plugged ✓ Abandoned ✓ Suspended WAG 20AAC 25.105 20AAC 25.110 GINJ❑ WINJ❑ WDSPL❑ No. of Completions Other 1b. Well Class: Af4chua t: Development ElExp oratory❑✓ Service ❑ StratigraphicTest❑ 2. Operator Name: Pioneer Natural Resources Alaska, Inc. 5. Date Comp., Susp., or Aband.: Aug 14, 2005 12. Permit to Drill Number: 202-177 3. Address: 700 G Street, Suite 600 Anchorage, AK 99501 6. Date Spudded: October 9, 2002 13. API Number: 50-009-20019-00 4a. Location of Well (Governmental Section): Surface: 1523' FSL, 471' FEL, Sec 30, T18N, R1 W, SM Top of Productive Horizon: Same Total Depth: Same 7. Date TD Reached: November 6, 2002 14. Well Name and Number: Bering #3 / 8. KB Elevation (ft): 406 15. Field/Pool(s): Pioneer Unit 9. Plug Back Depth(MD+TVD): Surface 4b. Location of Well (State Base Plane Coordinates): Surface: x- 584998 y- 2783852 (NAD 27) Zone- 4 TPI: x- Same y- Same Zone- Total Depth: x- Same y- Same Zone- 10. Total Depth (MD + TVD): 3750' MD, TVD 16. Property Designation: ADL 384685 11. Depth Where SSSV Set: NA 17. Land Use Permit: NA 18. Directional Survey: Yes No 0 19. Water Depth, if Offshore: NA feet MSL 20. Thickness of Permafrost: NA 21. Logs Run: None 22. CASING, LINER AND CEMENTING RECORD CASING WT. PER FT GRADE SETTING DEPTH MD SETTING DEPTH TVD HOLE SIZE CEMENTING RECORD AMOUNT PULLED TOP BOTTOM TOP BOTTOM 12.75 NA NA Surface 279 Surface 279 16" 35 sx class A None 8.625 23 J-55 Surface 401 Surface 401 11" 30 bbls class G None 5.5 17 K-55 Surface 3721 Surface 3721 7-7/8" 150 bbis class G None 23. Perforations open to Production (MD + TVD of Top and Bottom Interval, Size and Number; if none, state "none"): None 24, TUBING RECORD SIZE DEPTH SET (MD) PACKER SET (MD) 25. ACID, FRACTURE, CEMENT SQUEEZE, ETC. DEPTH INTERVAL (MD) AMOUNT AND KIND OF MATERIAL USED 3382-3386 5 bbl Type I cement squeezed 26. PRODUCTION TEST Date First Production: Method of Operation (Flowing, gas lift, etc.): Date of Test: Hours Tested: Production for Test Period Oil-Bbl: Gas-MCF: Water-Bbl: Choke Size: Gas -Oil Ratio: =low Tubing Tess. Casing Press: Calculated 24-Hour Rate -► Oil-Bbl: Gas-MCF: Water-Bbl: Oil Gravity - API (corr): 7. CORE DATA rief description of lithology, porosity, fractures, apparent dips and presence of oil, gas or water (attach separate sheet, if necessary). ubmit core chips; if none, state "none". one �MlGINAL Form 10-407 Revised 12/2003 CONTINUED ON REVERSE I GEOLOGIC MARKERS 29. RMATION TESTS NAME MD TVD Include and briefly summarize test results. List intervals tested, and attach detailed supporting data as necessary. If no tests were conducted, state "None". None 30. List of Attachments: Final Well Schematic, Operations Summary 31. 1 hereby certify that the foregoing is true and correct to the best of my knowledge. Contact: Printed Name: Joe Polva Title: Sr. Staff Drilling Engineer Signature: Phone: 907-343-2111 Date: INSTRUCTIONS General: This form is designed for submitting a complete and correct well completion report and log on all types of lands and leases in Alaska. Submit a well schematic diagram with each 10407 well completion report and 10-404 well sundry report when the downhole well design is changed. Item 1 a: Classification of Service wells: Gas Injection, Water Injection, Water -Alternating -Gas Injection, Salt Water Disposal, Water Supply for / njection, Observation, or Other. Multiple completion is defined as a well producing from more than one pool with production from each pool completely segregated. Each segregated pool is a completion. Item 4b: TPI (Top of Producing Interval). Item 8: The Kelly Bushing elevation in feet above mean low low water. Use same as reference for depth measurements given in other spaces on this form and in any attachments. Item 13: The API number reported to AOGCC must be 14 digits (ex: 50-029-20123-00-00). Item 20: True vertical thickness. Item 22: Attached supplemental records for this well should show the details of any multiple stage cementing and the location of the cementing tool. Item 23: If this well is completed for separate production from more than one interval (multiple completion), so state in item 1, and in item 23 show the producing intervals for only the interval reported in item 26. (Submit a separate form for each additional interval to be separately produced, showing the data pertinent to such interval). Item 26: Method of Operation: Flowing, Gas Lift, Rod Pump, Hydraulic Pump, Submersible, Water Injection, Gas Injection, Shut-in, or Other (explain). Item 27: If no cores taken, indicate "none". Item 29: List all test information. If none, state "None". Form 10-407 Revised 1212003 Pioneer Natural Resources Alaska, Inc. Pioneer Unit Bering #3 Plug and Abandonment Operations Summary July 22, 2005 Pre -work safety meeting. Move from Lowell #2 to Bering #3. Rig up on 5.5 inch casing to inject, test lines to 3000 psi. Inject 15 bbl cement rinsate @ 1.2 bpm, 2850 psi. Batch mix 85 bbl, 15 ppg, Type 1 cement. Pump cement down 5.5 inch casing at 1 bpm, 2400 psi. Injection pressure increased to 2800 psi @ 0.5 bpm. Cement began to thicken in one batch unit after 60 bbls cement pumped. Switched over to water and pumped 25 bbl water behind cement, squeezing 5 bbl cement into perfs. Shut in well at 3000 psi. Poured water and retarder to cement with about 2 feet of cement hardening in one pod. Cement mixing problem attributed to 6 x 4 inch restriction in circulating line, problem will not affect future work. Clean up equipment, SDFN. July 23, 2005 Pre -work safety meeting. Test downhole plug to 1250 psi. Rig up for top job on Bering #3. RIH with cementing hose to 200 feet. Mix and set a 15 ppg, Type I cement plug in top 200 feet of 5.5 inch casing. POOH with cement hose, shut in well. Move to Cook #1 well. July 26, 2005 Dug out cellar to 7 feet below grade. July 28, 2005 Cut off wellhead at 5.5 feet below pad level. July 29, 2005 Performed minor top job on well with less than 2 feet of cement. August 9, 2005 Matt Rader of ADNR and Chuck Sheve of AOGCC- inspected well for final P&A. August 14, 2005 Installed marker plate on well. Backfill to be completed when surface equipment removed. - 1 - Pioneer Natural Resources Alaska, Inc. Bering #3 Plug and Abandonment Photos a aavw ,. t+1N111G11LIII.6 upuiauuns at tsenng TF.i. -2- PBTD 3688 Pioneer Unit Bering #3 Final Well Schematic 2 Well Bering #3 API 50-009-20019 Qtr/Qtr Sec 30 Pioneer Natural Resources Alaska, Inc. Twp 18N Rng 1w 4 1 Size Weight Grade Thread County Matanuska, Susitna State Alaska Casing 8-5/8 23 J-55 401 Field Pioneer Unit Country USA Casing 5-1/2 17 J-55 3722 Tubing No. Depth Length OD ID Description 1 3382 4 Perfs from 3382-3386, 4 spf, 23 gram, SQUEEZED 2 Surface Well cutoff 5.5 feet below ground level 3 1075 TOC of lower cement plug in 5.5" casing est. 1075' 4 200 Surface plug to 200 feet. Modified by JRM 9/12/05 9 0 MEMORANDUM State of Alaska Alaska Oil and Gas Conservation Commission TO: Pm Regg, j'(� �t�S DATE: July 29, 2005 I. Supervisor FROM: Chuck Scheve, SUBJECT: Surface Abandonment Petroleum Inspector Pioneer Unit Lowell #2 PTD# 202-179 Baranof #4 PTD# 202-178 Bering #3 PTD# 202-177 Cook #1 PTD# 202-180 Friday, July 29,2005: 1 traveled to Pioneer's Coal Bed Methane exploratory locations to inspect the casing cut off and abandonment of the above listed wells. All casing strings on the above listed wells were cut off at approximately 5' below original ground level. The Lowell 2, Baranof 4 and Bering 3 wells were found full of cement to within 18" of surface in all strings and will be topped off prior to installation of the marker plates. The Cook 1 well had cement to surface in all strings except the tubing by production casing annulus. 150' of Y2" pipe was run in this annulus and I witnessed cement circulated back to surface. The marker plates with the required information bead welded to them were on location and"will be welded4o tie outer most casing. SUMMARY: I inspected the casing cut off depth, and the P&A marker plates on the Lowell 2, Baranof 4, Bering 3 and Cook1 wells and found all to be in order. Attachments: Lowell 2.JPG Baranof 4.JPG Bering 3 .JPG Cook 1 .JPG 0 Pioneer Unit Surface Abandonments Photos by AOGCC Inspector Chuck Scheve July 29, 2005 Baranof #4 Casing Cut and Marker Plate Bering #3 Casing Cut and Marker Plate Cook #1 Casing Cut and Marker Plate Lowell #2 Casing Cut and Marker Plate UAU E -/f, I u 2 K L/jILl", ALASKA OIL AND GAS CONSERVATION COM USSION Joe Polya Sr. Staff Drilling Engineer Pioneer Natural Resources Alaska, Inc 700 G Street Ste 600 Anchorage, AK 99501 Re: Bering #3 305-190 Dear Mr. Polya: • FRANK H. MURKOWSKI, GOVERNOR 333 W. 7O1 AVENUE, SUITE 100 ANCHORAGE, ALASKA 99501-3539 PHONE (907) 279-1433 FAX (907) 276-7542 Enclosed is the approved Application for Sundry Approval relating to the above referenced well. Please note the conditions of approval set out in the enclosed form. Please provide at least twenty-four (24) Commission to witness any required test. inspector at (907) 659-3607 (pager). hours notice for a representative of the Contact the Commission's petroleum field As provided in AS 31.05.080, within 20 days after written notice of this decision, or such further time as the Commission grants for good cause shown, a person affected by it may file with the Commission an application for rehearing. A request for rehearing is considered timely if it is received by 4:30 PM on the 23rd day following the date of this letter, or the next working day if the 23rd day falls on a holiday or weekend. A person may not appeal a Commission decision to Superior Court unless rehearing has been requested. AVII DATED this 4 day of July, 2005 Encl. • r RECEIVED JUL 13 2005 Alaska Oil & Gas Cons. Commission Anchorage July 13, 2005 Mr. Winton Aubert Alaska Oil and Gas Conservation Commission 333 W. 7th Ave #100 Anchorage, Alaska, 99501-3539 RE: Sundry Approval (Form 10-403) Pioneer Unit — Bering #3 Well Plug and Abandon Dear Mr. Aubert: Attached is the 10-403 form requesting approval to Plug and Abandon the Bering #3 well. Pioneer Natural Resources acquired the Pioneer Coal Bed Methane Project through the acquisition of Evergreen Resources Corporation. Evergreen Resources attempted various stimulation techniques in an effort to produce the methane from these wells; however, the wells did not prove economical. Pioneer has determined that this project is not economically feasible at this time based on a thorough evaluation which included peer assists with experts involved in the profitable coal bed methane projects in Colorado and Canada. Pioneer is requesting a BOP waiver for the proposed Bering #3 P&A work. This well can be killed with fresh water and has been granted BOP waiver's in the past by the AOGCC. If you have any questions, please feel free to contact me at 907-343-2111 or polyaj(cD,pioneernrc.com. � ,, �- �� w Sincerely, '�P�'-Qld- Joe Polya Sr. Staff Drilling Engineer Pioneer Natural Resources Alaska, Inc. 700 G Street, Suite 600 Anchorage, AK s STATE OF ALASKA C423- 7 -1- 05 ALASOIL AND GAS CONSERVATION COMMIX APPLICATION FOR SUNDRY APPRL % 20 AAC 25.280 VZA7 f i4%iP 01-:5 71 RECEIVED 1. Type of Request: Abandon Suspend Operational shutdown Perforate Lj WaiverLJJUL 13 T Alter casing ❑ Repair well ❑ Plug Perforations ❑ Stimulate ❑ Time Extension ❑ Change approved program ❑ Pull Tubing ❑ Perforate New Pool ❑ Re-enter Suspende&"Oil & Gas Cons. CO 2. Operator Name: 4. Current Well Class: 5. Permit to Drill Numbe : nc orage Pioneer Natural Resources Alaska, Inc. Development ❑ Exploratory ❑✓ Stratigraphic ❑ Service ❑ 202-177 3. Address: 6. API Number: 700 G Street Suite 600 Anchorage, AK 99501 50-009-20019-00 7. KB Elevation (ft): 9. Well Name and Number: 453 ft KB Bering #3 - 8. Property Designation: 10. Field/Pools(s): ADL 384685 Pioneer Unite (610500) 11. PRESENT WELL CONDITION SUMMARY Total Depth MD (ft): Total Depth TVD (ft): Effective Depth MD (ft): Effective Depth TVD (ft): Plugs (measured): Junk (measured): 3750' 3750' 3688' 3688' None None Casing Length Size MD TVD Burst Collapse Structural n/a n/a n/a n/a n/a n/a Conductor 275 feet 12.750 inches 275 feet 275 feet NA NA Surface 401 feet 8-625 401 feet 401 feet 2950 psi 1370 psi Intermediate n/a n/a n/a n/a n/a n/a Production 3722 feet 5.500 inches 3722 feet 3722 feet 5320 psi 4910 psi Liner n/a n/a n/a n/a n/a n/a Perforation Depth MD (ft): Perforation Depth TVD (ft): Tubing Size: Tubing Grade: Tubing MD (ft): 3382'-3386' 3382'-3386' None N/A N/A Packers and SSSV Type: None Packers and SSSV MD (ft): None 12. Attachments: Description Summary of Proposal Lj 13. Well Class after proposed work: Detailed Operations Program Q BOP Sketch ❑ Exploratory Development ❑ Service ❑ 14. Estimated Date for 15. Well Status after proposed work: / Commencing Operations: 7/19/2005 Oil ❑ Gas ❑ Plugged Q Abandoned ❑ WAG ❑ GINJ ❑ WINJ ❑ WDSPL ❑ 16. Verbal Approval: Date: Commission Representative: 17. 1 hereby certify that the foregoing is true and correct to the best of my knowledge. Contact Joe Polya Printed Name Joe Polya Title Sr. Staff Drilling Engineer Signature Phone 907-343-2111 Date 711 COMMISSION USE ONLY Conditions of approval: Notify Commission so that a representative may witness Sundry Number: .345— / 10 Plug Integrity ❑ BOP Test ❑ Mechanical Integrity Test ❑ Location Clearance Other: Subsequent eq e - 4- 1 S BF APPROVED BY Approv b : COMMISSIONER THE COMMISSION Date: d� 711S8i0n Form 10-403 Revised 11/2004 Submit in Duplicate Pioneer Natural Resources Alaska, Inc. Plug and Abandon Procedure Pioneer Unit Bering #3 Well The Bering #3 well was drilled in November 2002 and has been shut in since September 2003. The well has a 12-3/4 inch conductor set at 275 feet, 8-5/8 inch surface casing set at 401 feet and 5-1/2 inch production casing set at 3722 feet. Both the 8-5/8 and 5-1/2 inch casing strings were cemented back to surface. The well is perforated from 3382 to 3386 feet with 4 spf. No tubing or completion is in the well. A current schematic for the Bering #3 well is provided in Attachment 1. Pioneer Natural Resources Alaska, Inc. (Pioneer) proposes the following P&A procedure to plug the well in accordance with AOGCC regulations. Based on previous reports, the well can be killed easily with fresh water and BOP waivers have been granted by the AOGCC in the past for work on this well and other similar nearby wells. Pioneer hereby requests a BOP waiver for the operations described below. The proposed final Bering #3 well diagram is presented in Attachment 2. 1. Verify all permit paperwork is in place and give AOGCC 24 hour notice of intent to begin well work operations and intent to cement well and give AOGCC representative chance to witness same. Obtain BOP waiver before starting work. Mobilize necessary equipment and personnel to location. Install circulating head on 5-1/2 inch Demco wellhead valve. Bleed off any pressure to slop tank. 4. Rig up cementing lines to triplex pump and test lines to 3000 psi. Verify injection capability with cement rinsate from previous well for injection test. 5. Mix and pump an bbl cement plug down the casing and into the perforations leaving the entire lbore full of cement. Shut in casing valve. Clean up cementing equipment and recover cement cleanup water for injection test at next well or dispose of in an approved sanitary sewer system. WOC. Excavate around casing to minimum six (6) feet below existing grade level. Install guillotine saw on well and cut off well a minimum of 5 feet below grade or original ground level, whichever is deeper. Remove wellhead for backhaul to D&J yard. Top off any unfilled annuli with cement. Collect photo documentation of surface cement and cutoff well. Bering#3 P&A procedure.doc Page 1 7/13/2005 • Weld on well ID marker plate (1/4" x 24" x 24") with the following information bead welded on plate: Pioneer NRA APD: 202-177 Pioneer Unit Bering #3 API: 50-009-20019-00 Backfill well excavation and grade for positive drainage. Perform complete site inspection immediately after P&A operations if AOGCC inspector is available. Bering#3 P&A procedure.doc Page 2 7/13/2005 0 PBTD 3688 Attachment 1: Pioneer Unit Bering #3 Current Well Schematic Well Bering #3 API 50-009-20019 Qtr/Qtr Sec 30 Pioneer Natural Resources Alaska, Inc. Twp 18N Rng 1W Size Weight Grade Depth County Matanuska, Susitna State Alaska Casing 8-5/8 23 J-55 401 Field Pioneer Unit Country USA Casing 5-1/2 17 J-55 3722 Tubing No. Depth Length 0 D-7 ID Description 1 3382 4 Perfs from 3382-3386, 4 spf and 23 gram created by 5 1 (3 3/30/03 Modified by JRM 7/09/05 Attachment 2: Pioneer Unit Bering #3 Proposed Final Well Schematic PBTD 3688 Well Bering #3 API 50-009-20019 QtdQtr Sec 30 Pioneer Natural Resources Alaska, Inc. Twp 18N Rng 1w Size Weight Grade Thread County Matanuska, Susitna State Alaska Casing 8-5/8 23 J-55 401 Field Pioneer Unit Country USA Casing 5-1/2 17 J-55 3722 Tubing No. Depth Length I OD ID Description 1 33821 41 PerFs from 3382-3386, 4 spf, 23 gram, SQUEEZED 2 Surface I I Well cutoff 5 feet below around level I by STG 3/30/03 )5 MEMORANDUM State of Alaska Alaska Oil and Gas Conservation Commission TO: Jim Regg DATE: P. I. Supervisor FROM: John Spaulding, SUBJECT: Petroleum Inspector May 8, 2005 Location Clearances Pioneer Unit Pioneer Natural Res. MM The following wells in the Pioneer Unit were inspected for location clearances: ✓Bering 03 PTD; 202-177 Baranoff 04 PTD: 202-178 Cook 01 PTD: 202180 Lowell 02 PTD: 202-179 1702-14CC PTD: 199-065 1702-15DA WDW PTD 199-064 1702-15DD PTD: 199-066 Cornhusker 04 PTD: 202-181 RL Smith 03 PTD: 202-182 DL Smith 01 PTD: 202-184 Stromberg 02 PTD: 202-183 BLT 01 PTD: 199-068 All locations were found to be in excellent shape, well graded with some small amounts of debris. I requested that the debris be cleaned up and Joe Polya Pioneer Nat. Resources rep. agreed. He will inform as to when the final cleanup has been made so that I may make one last pass over the locations. SUMMARY, I found all locations in very good condition with small amounts of tidying up to be done. Attachments: photos on CD NON -CONFIDENTIAL Bering #3 (Pioneer) Location Clearance Inspection Photos from John Spaulding, AOGCC May 8, 2006 Well location clearance; off Church Road in Wasilla STATE OF ALASKA ALASKA OIL AND GAS CONSERVATION COMMISSION WELL COMPLETION OR RECOMPLETION REPORT AND LOG 1a. Well Status: Oil❑ Gas❑ Plugged❑ Abandoned❑ Suspended® WAGE] 1b. Well Class: 20AAC 25.105 20AAC 25.110 Development ❑ Exploratory GINJ❑ WINJ❑ WDSPL❑ No. of completions Other Service ❑ Stratigraphic Test ❑ 2. Operator Name: Evergreen Resources Alaska Corp. 5. Date Comp., Susp., or Aband.: �Gl2ff0� ��G 12. permit to Drill Number: 202-177 3. Address: 6. Date Spudded: 13, API Number: P.O. Box 871846 10/9102 50-009-20019-00 Wasilla, AK 99687 4a. Location of Well (Governmental Section): 7. Date TD Reached: 14. Well Name and Number: 1116/02 Bering #3 Surface: 8. KB Elevation (ft): 462 ft KB 15. Field/Pool(s): Pioneer Unit 1523' FSL & 471' FEL, Sec 30 Twn 18N Rng 1 W, Seward Meridian Top of Productive: Same 610500 Horizon: Same 9. Plug Back Depth (MD + Total Depth: Same TVD): 3688' KB MD 4b. Location of Well (State Base Plane Coordinates): NAD 27 10. Total Depth (MD + TVD): 16. Property Designation: 3750' KB MD ADL 384685 Surface: x- 584998.01 E y- 2783852.40 N Zone-4 11. Depth where SSSV Set: 17. Land Use Permit: TPI: x- Same y- Same Zone-4 NIA feet MD NIA TotalDepth: x- Same y- Same Zone-4 19. Water Depth, if Offshore: NIA feet MSL 20. Thickness of Permafrost: N/A 18. Directional Survey: Yes[] No® 21. Logs Run: Compensated Density Neutron Log; Induction; Gamma Ray; Cased Hole Neutron; Dual Spaced Cement Bond Log; Mud log, Inclination Survey 22. CASING, LINER AND CEMENTING RECORD CASING SIZE WT. E GRADE SETTING DEPTH MD SETTING DEPTH TVD HOLE SIZE CEMENTING RECORD AMOUNT PULLED TOP BOTTOM TOP BOTTOM 12-3/4 36 N/A 0 279 0 279 16 35 sx Class A 8-5/8 23 J-55 0 401 0 401 11 30 bbls Class G 5-1/2 17 K-55 0 3721 0 3721 7-7/8 150 bbls Class G 23. Perforations Open to Production (MD + TVD of Top and Bottom 24. TUBING RECORD Interval, Size, and Number; if none, state "none'): SIZE DEPTH SET (MD) PACKER SET (MD) None None None 3382-3386 4 spf 19 gram total 16 perfs 25. ACID, FRACTURE, CEMENT SQUEEZE, ETC. DEPTH INTERVAL MD AMOUNT AND KIND OF MATERIAL USED None U 26. PRODUCTION TEST Date of First Production: N/A Method of Operation (Flowing, Gas Lift, etc.): N/A Date of Test: N/A Hours Tested: Production for Test Period ♦ Oil-Bbl: NIA Gas-MCF: Water-Bbl: Choke Size: Gas -Oil Ratio: I N/A Flow. Tubing Press: Casing Pressure: Calulated ♦ 24-Hour Rate Oil-Bbl: NIA Gas-MCF: Water-Bbl: Oil Gravity -API (corr): N/A 27. CORE DATA Brief description of Iithology, porosity, fractures, apparent d Submit core chips; if none, state "none".+ send presence of oil, gas, or water (attach separate sheet, if necessary). Nonei� Form 10-407 Revised 4/2003 - -- GQNTINUED ON REVERSE SIDE ORIGINAL 28. GEOLOGIC MARKERS 29. FORMATION TESTS NAME MD TVD Include and briefly summarize test results. List intervals tested, and attach detailed supporting data as necessary. If no tests were Quaternary Gravels Surface Surface conducted, state "None". Tyonek Formation 250' 250' Perfs from 3382-3386 — pressure build up test. Test showed coals to be extremely tight. See attached graphs. 30. List of Attachments: Daily Drilling Reports; all above listed logs 31. 1 hereby certify that the foregoing is true and correct to the best of my knowledge. Contact Shane Gagliardi Printed Name Shane Gagliardi Title Petroleum Engineer Signature Phone 907-355-8569 Date 6/22/04 INSTRUCTIONS General: This form is designed for submitting a complete and correct well completion report and log on all types of lands and leases in Alaska. Submit a well schematic diagram with each 10-407 well completion report and 10-404 well sundry report when the downhole well design is changed. Item 1a: Classification of Service Wells: Gas Injection, Water Injection, Water -Alternating -Gas Injection, Salt Water Disposal, Water Supply for Injection, Observation, or Other. Multiple completion is defined as a well producing from more than one pool with production from each pool completely segregated. Each segregated pool is a completion. Item 4b: TPI (Top of Producing Interval). Item 8: The Kelly Bushing elevation in feet above mean low low water. Use same as reference for depth measurements given in other spaces on this form and in any attachments. Item 13: The API number reported to AOGCC must be 14 digits (ex: 50-029-20123-00-00). Item 20: True vertical thickness. Item 22: Attached supplemental records for this well should show the details of any multiple stage cementing and the location of the cementing tool. Item 23: If this well is completed for separate production from more than one interval (multiple completion), so state in item 1, and in item 23 show the producing intervals for only the interval reported in item 26. (Submit a separate form for each additional interval to be separately produced, showing the data pertinent to such interval). Item 26: Method of Operation: Flowing, Gas Lift, Rod Pump, Hydraulic Pump, Submersible, Water Injection, Gas Injection, Shut -In, or Other (explain). Item 27: If no cores taken, indicate "none". Item 29: List all test information. If none, state "None". (`� ("; A L IReport No. I (Date 10/9/2002 IEnginser John T. (supervisor D.Walters IserviceCo Tester Drlg Well Name Bering Number 3 JAPI Number 50-009-20019 IFormation, T onek I unit Pioneer section 30 ITownship 18 lRange 1 County Mat -Su Istate, Alaska ICountr USA AFE Daily Total Cum Total Accident (yin) N lWeather PTLY C LDY, W I N DY Surf Csg OD in ID (in) Drift (in) I Couplings Wt (ppf) Condition Grade Prod Csg OD in ID (in) Drift (in) Couplings Wt (ppf) Condition Grade Start End Duration Description MOVE TO THE BERING #3,RIG UP,DRILL 16" F/SURF TO 100' 1930 HRS Note, 16" F/100' T/TD IReport No. 2 (Date 10/10/2002 (Engineer John T. (supervisor D.Walters IServiceCc Tester Drlg Well Name Bering Number 3 JAPI Number 50-009-20019 Formation T onek Unit Pioneer Section 30 ITownship 18 Range 1 lCounty Mat -Su Istate Alaska ICountry USA AFE Daily Total Cum Total Accident(yln) N iWeather PTLY CLDY,WINDY Surf Csg OD in ID (in) Drift (in) Couplings Wt (ppf) Condition lGracle Prod Csg OD in ID (in) Drift (in) Couplings Wt (ppf) Condition Grade Start End Duration Description DRILL F/100' T/275'GL TD ,CIRC HOLE CLEAN,TOOH W/DHD,RUN 12 3/4"CONDUCTOR TO 275'GL, Notes DOWN ANULUS W/TRIMIE LINE Daily Drilling Report Report No Begin 11-04-02 0600 1 End 11i-05-02 0600 supervisor pWALTERS Well BERING N�T-p 3' API 50-009-20019-00 operator E1/ERGREEN RESOURCES ALA Field Pioneer Qtr/Qtr NE/SE sec 30 T18N Rng R1W ICounty MAT-SU I State ALASKA lCountry USA Target Tyonek I Planned TD(ft) # lRigName EWS RIG #1 Project PIONEER UNIT Current Depth (ft KB) Current Activity WOC 24hr Forecast pRILL 7 7/8' HOLE AFE Daily Total (s) 143560 iWell Total ($) 143560 Accident (y/n) N I Last Safety Meeting Data Conductor 12 3/4" @ 275 SurfCsg. Int Call Prd Csg Spud Date (MM/DD/YYYY) 11:-05-02 End Date (MM/DD/rrvr) Driller TD (ft KB) Bottom Csg (fl KB) Start End Duration Activity 1600 2000 4.0 MIRU RD-20 2000 2230 2.5 TIH W/11",DRILL 20' CMT,DRLG 11"HOLE F/275' T/402' 2230 2330 10 RIG REPAIR,RIG DIES INTM,ELEC PROBROWER TO KILL SWITCH 2330 0030 _ 1.0 TOOH W111" 0030 0130 1.5 RUN 13 JTS 8 518",23#,K-55 STC CSG,TOTALING 397.1',SET 401' ___ _- 0230 . _ 10 _—._ _.._.. �__ _--__,.SHw.__._.B_.__ RU EWS CMTRS,PUMP 5 BBLS H2O,10 BBLS GEL/DYE WATER,10 BBLS H2O,30 BBLS CMT @ 15.8#� _ DISP W/23.5 BBLS H2O,CIRC 3 BBLS CMT TO PIT,PLG DOWN @ 0215 HRS,RD CMTRS 0130 0230 Vw 1.0 it-1/ 8.28-99 0 • Daily Drilling Report Report No 2 1B.gl. 11-05-02 0600 1 End 11-06-02 0600 1 Supervisor 'D.WALTERS Well BERING No 3 API 50-009-20019-00 operator EVERGREEN RESOURCES ALA Field P%oneer otr/otr I NE/SE Isec 30 JT.p T18N jRng jR1W ICounty MAT-SU state ALASKA country SA Target Tyonek Planned TD(ft) #' Rig Name EWS RIG #1 Project PJONEER UNIT Current Depth (ft KB) Current Activity DRLG @ 2330' 24hr Forecast DRILL 7 7/8"HOLE AFE - Daily Total (s) 22330 lWell Total ($) 165890 Accident (y/n) I NLast Safety Meeting Data = s Conductor 12 3/4" @ 275 surf Csg. 8 5/8",23# @ 401' 1lntCsg 11 Prd Csg[ER-:-- Spud Date (MM/DD/YYYY) '- f -05-02 End Date (MM/DD/YYYY) "- Driller TD (ft KB) v T,. Bottom Csg (1 KB) Start End Duration Activity 0600 1000 _ 4.0 WOC,BREAK OUT CMT HEAD & TIH y 1000 1100 1.0 DRILL 25' CMT,DRLG 7 7/8" F/401' T/740' 1100 1300 2.0 DHD QU IT,TOOH, REPLACE BLOW TUBE,TIH 1300 0230 10.5 DRLG FR40' T/2330' 0230 0600 3.5 PUH T/2100',REPAIR TOP HEAD PACKING Ver 1.0 it-l/ 8-28-99 Daily Drilling Report Report No ,3 Begin 11-06-02 0600 End 11-07-02 0600 1 supervisor IDBALTERS Well BERING No 3 API 5Q-009-20019-00 Operator EVERGREEN RESOURCES ALA Fleld Roneer Otr/Otr I NE/SE Isec 30 TWP T18N IRng JRIW JC.unty MAT-SU IState )USKA lCountry JUSA Target Tyonek I Planned TD(ft) I # Rig Name EWS RIG #1 Project PIONEER UNIT Current Depth (ft KB) Current Activity CANT LOGS 24hr Forecast LOG,RUN & CMT 51/2" AFE Daily Total (3) 2Q24Q Well Total ($) 186130 Accident (ytn) N Last Safety Meeting Date Conductor 112 3l4" @ 275 surf Csg. 8 518",23# @ 401 Int Csg Prd Csg Spud Date (MM/DDmrY) 11!-Q5-Q2 End Date (MM�DDNYYY) Driller TD (ft KB) Bottom Csg (s KB) Start End ration Activity 0600 2230 5 DRLG 7 718" FI2330' T/3750' TD 2230 2. - 0 .. r3.O---- CIRC HOLE CLEAN _ _ _ _w ._.._.n___. ___ ____v. _,. 2330 _ 0230 TOOHFILOGS0230 0600 . MIRU PATTERSON WIRELINE,LOG OH INTERVAL Ver 1.0 iI-118-28-99 Daily Drilling Report Report No 4 eegln 11i-07-02 0600 1 End 11-08-02 0600 supervisor D;WALTERS Well BERING lNo 3 API 50-009-20019-00 Operator EVERGREEN RESOURCES ALA Field I Pweer Otr/4tr NE/SE Isec 130 ITwp T18N JRg R1W ICounty MAT-SU Istate ALASKA ICountry 11SA Target Tyonek I Planned TD(ft) # Rig Name EWS RIG #1 1project PIONEER UNIT Current Depth (ft KB) Current Activity 24hr Forecast MOVE TO THE CORNHUSKER #4 AFE ;' Daily Total (3) $7025 Well Total (S) 273155 Accident (y/n) N, Last Safety Meeting DateLAS Conductor 112 3/4" @ 275 surf Csg. 8 5/8",23# @ 401' Int Call Prd Csg Spud Date (MM/DDnvvv) 11-05-02 End Date (MM/DD yYYY) 1'1-07 OZ Driller TD (ft Ks) 3750 Bottom Call (s KB) 3721 Start End Duration Activity 0600 1330 5.5 LOGGING W/PATTERS_ ON WIRELINE,RDMO WL 1330 1830 5.0 RU CSG T00�¢ LS,RUN 51/2"CMT GUIDE SHOE,1 JT 5112",17#,K-55,LTC CSG,INSERT FLOAT, 124 JTS 51/2",17#,K-55 LTC CSG,TOTALING=3716.54',SET@3721.54' 1830 1930 1.0 LAND CSG Q- 3721' NU WH 1930 2200 2.5 RD RD-20,RU EWS CMTRS 2200 0030 2.5 PUMP 60 BBLS H2O,10 BBLS GEL/DYE WATER,20 BBLS H20150 BBLS THIXOTROPIC @ 13.7# DISP W/85.5 BBLS H2O PLUG DOWN Q 0030 HRS,CIRC 7.5 BBLS CMT TO PIT,FLOAT HELD RDMO EWS Notes Summary ver 1.0 pW/ 8-29-99 0 • Daily Completion Report Report No Begin Q2/09103 End 2/9/2003 Supervisor Michael Polley Weil Bering 1No 3 1 API 50-0009-20019 1 operator lEvergreen Operating Corporl Field cenn Qtdgtr Sit Sec Twp �gjJ Rng 11// ty Matanuska,Susitna e jAlaska 1c.urtry JUSA Contractor I I EWS Rig #5 24nr Forecast PO# I Daily Total IS $3,840.00 1 well Total js, $3,840.00 --7Accident 1y/m NO Last Safety meeting Date Start End Duration 0700 1200 1200 1600 5 4 Activity _oaded equipment and tools. Rigged down rig. Repaired catwalk hinge and replaced grease fittings 3o rig could be greased. Roaded to location. Rigged up. Broke off frac valve, nippled up 3,000# - 51/2" X 7 1/16" companion lange, 3,000#, 7 1/16" X 7 1 1/6" spool, 3,000# double ram Townsend BOP and stripping head. 4ctuate blind rams. TIH with used 4 3/4" bit and 2 jts tbg. Actuate pipe rams. Insalled stripping rubber. TIH to 500'. Unloaded hole with compressor. TIH to 1000'. SDON COST ESTIMATE; RIG $2,040.00 Kill Trucks Water Trucks; Tubing Rods Wire line work Down hole tools $200.00 Tool Hand Cement: SUPERVISION $600.00 MISC $1,000.00 TOTAL $3,840.00 Ver 1.0 jjF1/ 8 28-99 • Daily Completion Report Report No Begin 02/10/03 End 2/10/2003 1 Supervisor Michael Polley Well Bering I No 3 1 API 50-0009-20019 1 Operator Evergreen Operating Corpor Field (2tr,gtr sec 1 Twp 18N IRng 1 W ICounty Matanuska,Susitna s.1e jAlaska Country USA Contractor I I EWS Unit #9619 1 Current Activity I Unloading hole preparing to pert. I 24hrForecast I Perf & run pressure rec. PC# Daily Total ($) $16,040.00 Well Total (Si $19,880.00 Accident (ym) NO Last Safety Meeting Date Start End Duration Activity 0700 1600 9 Pickup fittings at yard. Travel to location. Try to unload hole @ 1000'. Pressure too high. TOH to 850'. Unload hole. TIH to 1230'. Unload hole. TIH to 1630'. Unload hole. TIH to 2010'. Unload hole. TIH to 2360'. Unload hole. TIH to 2675'. Unload hole. TIH to 2920'. Unload hole. TIH to 3109'. Unload hole and blow dry. TIH to PBTD @ 3688'. Lay down 14 jts tbg. TOH standing remaining tbg back. Nipple down BOP. Nipple up tbg head. Flange up BOP. SDON ,COST ESTIMATE; RIG $1,490.00 Kill Trucks Water Trucks; Tubing $12,950.00 (Rods tWire line work wn hole tools ToolHand lCernent: SUPERVISION $600.00 MISC $1,000.00 TOTAL $16,040.00 Ver 1.0 BPI 8-28-99 • 0 Daily Completion Report Report No Begin 1 02/11/03 1 End 1 2/11/2003 1 Supervisor Michael Polley Well Bering I No 3 1 API 50-0009-20019 1 Operator Evergreen Operating Corporl Field Qtr,ptr sec 1 Twp 18N I Rng 1 W ICounty Matanuska,Susitna site jAlaska IC..ntry USA Contractor EWS Unit #9619 Current Activity Perfing & running pressure recorder. 2011. ecast I Wait on psi build up. PC# I Daily Total (s) $5,288.00 Well Total($( 1 1 $12,218.00 Accident (ym) NO I Last Safety Meeting Date Start End Duration Activity 0830 1400 51/2 Rigged up Patterson Wireline. Perforated under lubricator, 3382'-3386', 4 SPF. TIH / 2 7/8,,X 4' bull plugged tbg sub with pressure recorder # 19193 (started @ 9:58) and pressure recorder #19194 (started @ 9:58 and 30 seconds) loaded in sub. A 2 7/8" X 2' perforated sub, lockset RBP and tbg. Started in hole @ 10:21. Landed and set RBP @ 3297', @ 11:35. TD of bull plugged sub @ 3309'. Released off RBP. TOH with 2 jts tbg. Retrieving head @ 3235'. Landed tbg in tbg head. Nippled down BOP. Shut in tbg and tbg head. Rigged down. Policed location. Moved off. jCorrection on daily cost for 2110/03. No tubing charge for well at this time. Daily and cumm cost for 2110/03 should be less $12950 j I er 'COST ESTIMATE; RIG $960.00 Kill Trucks Water Trucks; Tubing Rods Wire line work $2,728.00 Down hole tools Tool Hand Cement: SUPERVISION $600.00 MISC $1,000.00 TOTAL $5,288.00 No tubing charge at this time. Correction on daily cost for 2/10/03 = (-$12950) Ver 1,0 jjt-1l8-28-99 0 • Daily Completion Report Report No 4 Begin 1 02/24/03 End 2/24/2003 1 Supervisor Michael Polley well Bering I No 3 1 API 50-0009-20019 Operator Evergreen Resources Alaska Field I Pioneer otrfQtr I NE/SE I sec 130 ITwp 18N I Rng 1W County Matanuska,Susitna — jAlaska ICountry USA Contractor I I EWS Unit#9619 Current Activity I Pulling RBP, pressure bomb and tbg. I 24hrForecast Wait on completion. PO# I Daily Total (S) $3,610.00 IWO Total (S) 1 1 $28,778.00 Accident (y/n( NO I Last Safety Meeting Date Start End Duration Activity 1600 2200 6 Move in and rig up. TIH with 2 jts tbg. Latch onto RBP. Release RBP. No blow after TBP released. TOH with tbg, bomb and RBP. Laid tbg down. Nipple down and shut well in with frac. valve. Rig down and move off. COST ESTIMATE; RIG $2,260.00 Kill Trucks Water Trucks; Tubing Rods Wire line work Down hole tools Tool Hand $550.00 Cement: SUPERVISION $300.00 MISC $500.00 TOTAL $3,610.00 Ver 1.0 jjt-1/ 8-28-99 Daily Completion Report Report No I 5 Begin 4-2-03 0930 1 End 4-2-031700 1 supervisor Shane Gagliardi well BERING No 3 API 50-009-20019-00 Operator EVERGREEN RESOURCES ALASKA Field Pioneer Qtr1Qtr NE/SE sec 301 Twp T18N Rng R1W county MAT-SU State ALASKA lCountY JUSA Target Tyonek I Planned TD(ft) 3750 Rig Name EWS RIG #1 lProject PIONEER UNIT Current Depth (ft KB) Current Activity Break Down and Wash Perfs 24hr Forecast I Pressure Build Up Test AFE Daily Total ($) 5000 well Total ($) 1 $20,828. 1 Accident (ym) I N Last Safety Meeting Date Conductor 12 3/4" @ 275 surf Csg. 8 5/8",23# @ 401' lint Csg I IPrd Csg 5-1 /2", 17# @ 3722' Spud Date (MM/DD/YYYY) 11-05-02 End Date (MM/ooNY(y) 11-07-02 Driller TD (ft KB) 3750 1 Bottom Csg (ft KB) 3721 Start End Duration Activity 0930 1230 3 RU EWS cmt unit and bring acid for dump bail job from yard. 1230 1430 2 Dump bail 10 gallons of 32% HCL @ 3372. Charges did not fully break glass disk. TIH to 3372 and work acid out of dump bailer. TOH and redress dump bailer for second run, remove plastic donut from glass disk. TIH, dump bail 10 additional gallons of 32% HCL @ 3372'. 1430 1500 0.5 Initial fluid level @ 80'. Load csg w/ fresh city water and biocide. Displace acid as follows: 0.5 bbls @ 0.5 BPM 6.5 bbls @ 3.0 BPM 2800 psi ISIP 2200 psi, total displacement was 7 bbls. Pressure fell to 1500 psi within 5 minutes. 1500 1530 0.5 RU full bore lubricator and collar stop tools. 1530 1700 1.5 Attempt to run collar stop and setting tools under pressure. There was not enough weight to get down under pressure. 1700 Shut well in over night to let pressure decrease and stabilize. Ver 10 Bt-l/ 8-28-99 i • Daily Completion Report Report No 6 Begin 4-3-03 0800 1 End 4-3-031700 1 Supervisor Shane Gagliardi well BERING No 3 AN 50-009-20019-00 operator EVERGREEN RESOURCES ALASKA Field Pioneer Qtr1Qtr NE/SE Isec 130 ITwp T18N jRng R1W lCounty MAT-SU State ALASKA ICo.ntry JUSA Target iTyonek Planned TD(ft) 3750 IRig Name I EWS RIG #1 1Project PIONEER UNIT Current Depth (ft KB) Current Activity TIH w/ Wireline Tools 24hr Forecast Pressure Build Up Test AFE Dafly Total ($) 3500 Well Total (81 $24,32$, Accident (y/n) N Last Safety Meeting Date Conductor 12 3/4" @ 275 surf Csg. 8 5/8",23# @ 401' Int Csg Prd Csg 5-1 /2", 17# @ 3722' Spud Date (MM/DD/YYYY) 11-05-02 1 End Date (MM/DD/YYYY) 11-07-02 Driller TD (ft Kl8) 3750 1 Bottom CSg (ft KB( 3721 Start End Duration Activity 0800 0900 1 Thaw wellhead and prepare to TIH with wireline collar stop tool. RU full bore lubricator. 0900 1500 6 Attempt to TIH w/ wireline collar stop tool. Had problems getting tool through frac valve. The tool was Iattempting to set in the grooves in the frac valve. Modified tool to run through frac valve (taped dog ;supports to decrease OD and put a ring of tape around top of cage to prevent premature setting). Need ';heavier sinker bar to aid in running tool. 1500 1600 1 lSet collar stop @ 3332'. RU pressure bombs and 4-1/2" no blow tool. 1600 1700 1 'Arms on no blow tool got hung up in frac valve, tool un-jayed and fell to bottom. RU fishing tool and TIH. Tag fish @ 3328' and set down. TOH. Centralizer above fishing tool unscrewed and was left downhole. Fish in hole consists of collar stop, pressure gauges, no blow tool, fishing tool and centralizer w/ 5/8" pin looking up. 1700 Shut down to research fishing tools to retrieve fish. Vey 10 ht-118-28-99 C� Daily Completion Report Report No % Begin 4-5-03 0800 1 End 4-5-031800 Supervisor Shane Gagliardi well BERIN I No 3 API 50-009-20019-00 Operator EVERGREEN RESOURCES ALASKA Field Pioneer Otr/Otr NE/SE I sec 130 ITwp T18N IRng R1N/ I county MAT-SU &t ALASKA I Country USA Target Tyonek I Planned TD(ft) 3750 jRigNarne JEWSRIG#1 I Project JPIONEERUNIT Current Depth (ft KB) Current Activity TIH w/ Wireline Tools I 24hr Forecast I Fish Tools AFE Daily Total (s) 15300 1 Well Total ($) 1 29,628. Accident (y/n) I N Last Safety Meeting Date Conductor 112 3/4" @ 275 surf Csg. 18 5/8" 23# @ 401' Int Csg Prd Csg 5-1/2", 17# @ 3722' Spud Date (MM/DDmNY) 11-05-02 End Date (MM/DD/YYYY) 11-07-02 Driller TD (ff KB) 3750 1BOttOM Csg (q KB) 3721 Start End Duration Activity 0800 1200 4 Wait on fishing tools. 1200 1500 3 MIRU Patterson. TIH w/ fishing tools. Fish pressure gauges, no blow tool, centralizer and collar stop tool. (Fish was retrieved on first run. Pressure gauges were downloaded and inspected - no damage noted. 1500 1800 3 Attempt to re -run collar stop tool. Had problems getting tool through frac valve. Remove frac valve and TIH w/ collar stop tool. Set screw in centralizer malfunctioned and centralizer, set tool and collar stop were left in hole. 1800 SDON Cost Estimate: Patterson Wireline: 3,000 lDownhole Tools: 1,500 Supervision: 300 Misc: 500 (Total: $5300 Ver 1.0 pt-1/ 8-28-99 Daily Completion Report Report No $ Begin 4-6-03 0800 1 End 4-6-031200 1 supervisor Shane Gagliardi Well BERING ND 3 AN 50-009-20019-00 Operator EVERGREEN RESOURCES ALASKA Field Pioneer Qtr/Qtr NE/SE Isec 130 JT.p T18N JR.g JR1W Icounty MAT-SU State ALASKA I country JUSA Target JTyonek I Planned TD(ft) 3750 JRigNanne EWS RIG #1 lProject PIONEER UNIT Current Depth (ft KB) Current Activity TIH W/ Wireline Tools 24hr Forecast Fall Off Test AFE Daily Total ($) 540Q Well Total (51 35,028. Accident (ym( N Last Safety Meeting Date Conductor 112 3/4" @ 275 surf Csg. 18 5/8",23# @ 401' Int Csg Prd Csg 5-1/2", 17# @ 3722' Spud Date (MM/DD/YYYY) 11-05-02 End Date (MM/DD/YYYY) 1 1 -07-02 Driller TD (n KB) 3750 1Bottom Csg (8 KB) 3721 Start End Duration Activity 0800 1000 2 MIRU Patterson wireline. Fish collar stop tool, set tool and centralizer. Fish was retrieved on first run. It appears that the set screw malfunctioned during jar action. The 5/8" box that was holding the centralizer was (mushroomed inward showing that the centralizer was lost when jarring operation began. There is evidence that the box had slid along the bow spring and contacted the casing wall repeatedly due to jarring action. 1000 1100 1 (TIH w/ collar stop tool. Tool set down @ 1236. No more casing springs on hand. Set tool @ 1236'. Program gauges. Gauges powered up @ 10:54.00, 1100 1200 1 TIH w/ pressure gauges; set @ 1236'. MIRU EWS cmt pump. Pump 2.5 bbls @ 0.3 BPM. Final pressure 2550 psi, ISIP 2500. !Cost Estimate I Patterson: 3000 Cmt Pump: 2000 Water Trk: 100 Supervision: 300 Total: $5400 Ver 10 tt-1/ 8-28-99 Daily Completion Report Report No 9 Begin 05/07/03 1 End 5/7/2003 1 Supervisor jGagliardi well Bering I No 3 1 API 50-0009-20019 1 Operator Evergreen Resources Alaska Field Pioneer otrlotr NE/SE I Sec 130 ITwp 18N I Rng 1W ICounty Matanuska,Susitna s-te jAlaska Country USA Contractor I Patterson I Current Activity I POOH w/ gauges and collar stops I 24hrForecast Shut In Po# Daily Total (s) $3,700.00 Well Total (s) 1 1 $38,728.00 Accident (ym) Np I Last Safety Meeting Date Start End Duration Activity 0900 0930 1000 11100 0930 1000 1100 0.5 0.5 1 MIRU Patterson wireline and boom truck. POOH w/ gauges and collar stops. Maximum pressure @ 3258 and falls off to 925 psi at end of test and falling at approximately 3.3 psi per day. BHT @ 52 degrees F. Gauges were set @ 1236'.� Perfs from 3382-3386._ RDMO Patterson to DL Smith to pull gauges. SWIFN .......... COST ESTIMATE Patterson $1,600.00 Supervision $600.00 Misc. $1,500.00 TOTAL $3,700.00 (Summary POOH w/ pressure gauges. Ver 1.0 jjt-t/ 8-28-99 0 • Daily Completion Report PAGE 2 Report No 10 Begin 07/27/03 1 End Supervisor Trout We11 Bering I NO 3 1 API 50-009-20019-00 1 Operator Evergreen Resources Alaska IF,eld Pioneer OtrtQtr NE/SE I see 130 ITwp 1 18 Rng 1 1 County I Mat -Su State Alaska Country USA Contractor EWS # 9619 I Current Activit, ITIH w/ BHP Gauges on 2 7/8" tbg. 24hrPorecast Running BHP PO# I Daily Total ($) 1 $4,100.00 ' Well Total ($) $42,828,00 Accident (ym) No I Last Safety Meeting Date 1 7-25-03 Start End Duration 1/2 Activity 1515 1545 FL @ surface 1st run w/ swab. Swabbed 6 bbls water FL @ 1000' 2nd run w/ swab. Swabbed 6 bbls water FL @ 2000' 3rd run w/ swab. Swabbed 8 bbls water. Swab pulled from packer. 1545 1615 1/2 @ 1543 hrs 7-25-03 SD for 30 min. Swabbed 1.47 bbl of water 4th run. FL @ 3137' 1615 1645 1/2 Swabbed .58 bbl of water 5th run. FL @ 3237'. 1645 1715 1/2 Swabbed .58 bbl of water 6th run. FL @ 3237. 1715 1845 1/2 Swabbed .24 bbls of water 7th run. FL @ 3287'. Swabbed total of 22.87 bbls water in 2 1/2 hrs. Ending FL @ 3387'. SI @ 1750 hrs. 7-25-03 for BHP build up pressure test. 7-26-03 SI Running BHP Survey. RD EWS unit # 9619. Move to Cook #1. 7-27-03 SI Running BHP Survey. COST ESTIMATE; Rig $2,500.00 Supervision $600.00 Misc. $1,000.00 TOTAL: $4,100.00 Ver 1.0 pt-1/ 8-28-99 Daily Completion Report Report No 110 Begin 07/27/03 1End 7/27/2003 1 Supervisor ITrout Well Bering I No 3 1API 50-009-20019-00 1 operator IlEvergreen Resources Alaska Field jPioneer atr/otr NE/SE I Seo 130 ITwp 18N I Rng JJW Icounty Mat -Su ISIal. Alaska coanVy USA Contractor I EWS # 9619 1 Current Activity TIH w/ BHP Gauges on 2 7/8" tbg. snnr Forecast I Running BHb-25-03 PO# Daily Total (S) $4,100.00 Well Total (s) $42,828.00 Accident (ym) NQ Last Safety Meeting Date Start End Duration Activity 0700 0800 1 Spread plastic, RU EWS unit # 9619. 0800 0900 1 Remove 51/2" Demco valve. Install well head. Nipple up BOP. Pressure test BOP to 3000 psi. Held OK. 0900 0930 1/2 Make up BHP gauges, place in bottom of tbg. 0930 1030 1 WO flow back tank. 1030 1330 3 PU 51/2" Lock -set packer & TIH w/ 2 7/8" tbg as follows. 1-2 7/8" EUE 6.5# J-55 tbg sub. 10.00 103 jts 2 7/8" EUE 6.5# J-55 3324.64 1-2 3/8"x2 7/8" EUE XO .50 1- 2 3/8" EUE x 51/2" Lock -Set packer 3.87 1-2 3/8" x 2 7/8" EUE XO .50 1-2 7/8" EUE 6.5# J-55 tbg. 32.32 1-2 7/8" EUE J-55 perforated nipple 2.00 1-2 7/8" EUE 6.5# J-55 tbg sub. 4.00 3377.83 Set packer. Bottom of tbg 3380', packer @ 3337'. Packer set an 1435 hrs, 7-25-03. 1330 1430 1 Nipple down BOP. 1430 1515 3/4 RU to swab, 1st run (a)1513 hrs 7-25-03. FL @ surface. COST ESTIMATE; Ver 1.0 pt-1/ 81&99 0 0 Daily Completion Report Report No 36 jBegj. 09/04/03 1 End 9/4/2003 supervisor Trout Well Bering I No 3 API 50-009-20019-00 1 operator lEvergreen Resources Alaska 111.1d jPioneer Qtdot NE/SE I sec 130 IT.p 118N I Rng 1W lCounty Mat -Su State JAlaska Country USA EWS # 9619 Current Activity Prepare to Pull BHP recorders 24hr Forecast SI to Evaluate htor Daily Total (s) 1 $1,300.00 lWall Total (s) Accident(ym) No ILast Safety Meeting Date 9-4-03 Start End Duration Activity 1230 1300 1/2 Spread plastic on location for unit # 9619 1300 1430 1 1/2 RU unit # 9619 1430 1630 2 Nipple up BOP & pressure test to 3000 psi for 10 min, held OK. 1630 1700 21/2 Unseat Lock -Set packer @ 3337'. TOH LID 2 7/8" tbg. LID packer & 104 jts of 2 7/8" tbg, 1700 1715 1/4 Secure well & SDON. COST ESTIMATE; Rig $500.00 Supervision $300.00 Misc. $500.00 $1,300.00 Ver 1.0 At-11 8-2899 Daily Completion Report ReportNo 38 jBegm 09/05/03 1 End 9/5/2003 Supervisor Trout Well Bering I No 3 1,11, 50-009-20019-00 1 operator IlEvergreen Resources Alaska 1pioneer ntrioa NE/SE Sec 30 TwP 18N Rng 1W county Mat -Su State Alaska co�atry USA contractor EWS # 9619 C u rrent Acbvity SI to Evaluate 124hrForeaast I SI to Evaluate PO# Daily Total (g) $650.00 WO Total )g) $44,778.00 Accident(ym) NO Last safety Meeting Date Start End Durafion Activity 0800 0900 1 Nipple down BOP. 0900 1100 2 RD EWS unit # 9619. Clen up location. Move to DL Smith # 1. Bottom hole pressure report to follow. No further reports to follow until addational well work is done. COST ESTIMATE; Rig Supervision Misc. TOTAL Notes $250.00 $150.00 $250.00 $650.00 Ver 1.0 jjt-118-28-99 PRESSURE AND TEMPERATURE VS DELTA TIME 400( ON E 2001 D U) CO w ry w 100, Company: Evergreen Resources Alaska Location: Bering #3 Date: 4/6/03 - 5/7/03 Serial# 9340 Max. Pressure: 3257.794 psig Max. Temperature: 55.646 F 0 100 200 300 400 500 600 700 DELTA TIME(HOURS) 56 54 • 52 50 m 48 c X m 46 44 • 42 40 38 800 161 141 121 101 LU 8 U) U) w ry 6 a_ 0 2 PRESSURE AND TEMPERATURE VS DELTA TIME Company: Evergreen Resources Alaska Location: Bering #3 Date: 7/25/03 - 9/4/03 Serial# 19193 Max. Pressure: 1508.571 psig Max. Temperature: 83.142 F 0 100 200 300 400 500 600 700 800 900 1000 DELTA TIME(HOURS) .e :e] m -v 70 MX D C X m aim 50 0 0 RESOURCES(ALASKA)CORP� A Subsidiary of Evergreen Resources, Inc. June 23, 2004 O0a-(- -' Mr. Bob Crandall Alaska Oil and Gas Conservation Commission 333 W. 7th Ave #100 Anchorage, Alaska, 99501-3539 RE: Evergreen Resources (Alaska) Corp.'s 2004 Core Program Dear Mr. Crandall: The purpose of this letter is to fulfill the reporting requirements of Evergreen Resources (Alaska) Corp. as stipulated by 20AAC25.070 and 20AAC25.071 for the wells drilled in Pilot #2. Attached are the drilling summaries, logs and other pertinent information for the Lowell #2, Bering #3 and Baranof #4. Drilling operations have been completed, but these wells have not been completed. These three wells are shut in; an evaluation of coals in the upper section of the hole is ongoing to determine the viability for completion and production testing. Several pressure tests were conducted on the Bering #3. There is one set of perforations open from 3382-3386. The graphs of those tests have been included. If you have any questions, please feel free to contact me at 907-357-8130 or shaneg(a-evergreengas.com. Sincerely, Shane Gagliardi Petroleum Engineer 1075 Check Street, Suite 202 < Wasilla AK 99654 RO.Box 871845 , Wasilla. A K 99687 . TEL 907 357,8130 ^ FAX 907. 357,8340 RESOURCES (ALASKA) CORP. A Subsidiary o/ Evergreen Resources, Inc. March 22, 2004 Winton Aubert Petroleum Engineer Alaska Oil and Gas Conservation Commission (AOGCC) 333 West 7t" Ave. #100 Anchorage, AK 99501-3539 RE: Request for Operational Shut Down for the Lowell #2, Bering #3 and Baranof #4 Dear Mr. Aubert: Attached are the 10-403 applications for sundry approval requesting that an operational shut down be granted for the following wells: Lowell #2, Bering #3 and Baranof #4. A pressure build up test has been conducted on the Bering #3 over a perforations from 3382'-3386'. There has been no completion activity on the Lowell #2 and Baranof #4. If you have any questions, please feel free to contact me at 907-355-8569 or shaneg@evergreengas. com. Sincerely, .�a 4� - Shane Gagliardi Petroleum Engineer R 2 5 200 ORIGINAL 1075 Check Street, Suite 202 - Wasilla AK 99654 P.O. Box 871845 - Wasilla, AK 99687 - TEL 907.357.8130 - FAX 907.357,8340 STATE OF ALASKA ALASKA OIL AND GAS CONSERVATION COMMISSION 1. Type of Request: Abandon ❑ Suspend ❑ Operation Shutdown ® Perforate ❑ Variance ❑ Annular Disposal ❑ After Casing ❑ Repair Well ❑ Plug Perforations ❑ Stimulate ❑ Time Extension ❑ Other ❑ Change Approved Program ❑ Pull Tubing ❑ Perforate New Pool ❑ Re-enter Suspended Well ❑ 2. Operator 4, Current Well Class: 5. Permit to Drill Number: Name: Evergreen Resources Alaska Corp. Development ❑ Exploratory ® Stratigraphic ® Service ❑ 202-177 3. Address: P.O. Box 871846 6API Number: Wasilla, AK 99687 50-009-20019-00 7. KB Elevation (ft): 9. Well Name and Number: 453 ft KB Bering #3 8. Property Designation: 10. Field/Pool(s): ADL 384686 610600 11. PRESENT WELL CONDITION SUMMARY Total Depth MD (ft): Total Depth TVD (ft): Effective Depth MD (ft): 1 Effective Depth TVD(ft): Plugs (measured): Junk (measured): 3760' 1 3750' 3688` 3688' None None Casing Length Size MD TVD Burst Collapse Structural Conductor 276' 12-3/4" 279' 279' N/A NIA Surface 397' 8-5/8" 401' 401' 2960 1370 Intermediate Production 3717' 5-112" 3721' 3721' 6320 4910 Liner Perforation Depth MD (ft}: Perforation Depth TVD (ft}: Tubing Size: TN/A Tubing Grade: FTubing MD (ft): 3382'-3386' 3382'-3386' None N/A Packers and SSSV MD (ft): Packers and SSSV Type: None None 12. Attachments: Description Summary of Proposal ❑ 13. Well Class after proposed work: Detailed Operations Program ❑ BOP Sketch ❑ Exploratory ® Development ❑ Service ❑ 14. Estimated Date for 15. Well Status after proposed work: Commencing Operations: 23 Mar 05 Oil ❑ Gas® Plugged ❑ Abandoned ❑ WAG ❑ GINJ ❑ WINJ ❑ WDSPL ❑ 16. Verbal Approval: Date: Commission Representative: 17. 1 hereby certify that the foregoing is true and correct to the best of my knowledge. Contact Shane Gagliardi Printed Name Shane Ga liardi Title Petroleum Engineer Signature Phone 907-366-8669 Date 3/22/04 Commission Use Only Sundry Number: Conditions of approval: Notify Commission so that a representative may witness Plug Integrity ❑ BOP Test ❑ Mechanical Integrity Test ❑ Location Clearance ❑ Other. SubseZb wired: I BY ORDER OF Appro COMMISSIONER THE COMMISSION Dater Form 10-4ctRe sealQO,03 ubmit i dupfi to RESOURCES (ALASKA) CORP. A Subsidiary of Evergreen Resources, In,% Cook #1 Lowell #2 Bering #3 Paranof #4 DIL Smith #1 Stromberg #2 RL Smith #3 Corr inusKer #4 API 50-009-20022-00 50-009-20021-00 50-009-20019(-00 50-009-20020-00 50-009-20026-00 50-009-20025-00 50-009-20024-00 50-009-2002 00 Permit to Drill # 202-180 , 202-179 202-177 202-178 202-184 202-183 202-182 202-181 Survey Type Sure Shot Model A Sure Shot Model A Sure Shot Model A Sure Shot Model A Sure Shot Model A Sure Shot Model A Sure Shot Model A Sure Shot Model A Inclination Inclination Inclination Inclination Inclination Inclination Inclination Inclination Survey Date 12/5/2002 11/6/2002 12/5/2002 11/3/2002 12/5/2002 12/5/2002 12/5/2002 12/5/2002 Conductor 12-3/4 245 200 275 300 320 360 420 415 Surface 8-5/8 384 381 400 513 1038 1020 1016 539 PBTD 3670 3238 3688 3697 2487 2492 2191 2577 Well TD 1 3740 1 3750 1 3753 1 3750 2510 1 2510 2300 2600 Measured Depth I I I I 250 0.5 0.5 1 1 1 2 300 0 500 1 7 4 3.5 0.5 4 1000 5 8 14 7 13 14 5 6 1500 10 8 13.5 14 10 8 1750 10 14 2000 9 10 14 14 14 11 2070 14 2465 14 2491 14 2500 10.5 11 14 101 3000 9 9 3250 11.5 14 3500 8 3665 13 3680 141 Surveying Compnay Patterson Wireline Survey Conducted By: Pat Patterson Owner Signature Date RECEIVED SEA 16 2003 Alaska 0*11 & Gas Consr ConvT+Ssicr'n Anchorage Corrected State Plane 9-9-03 BFL PTD NAME AS027Z4E 0-P27Z4N 2021780 BARANOF #4 585062.93 2782923.45 2021770 BERING #3 585004.70 2783942.33 2021810 COOK #1 584593.05 2783408.27 2021820 ROBERT SMITH #3 542887.46 543786.36 2774899.30 2021840 D.L.SMITH#1 —AR 2774923.09 2 221830 _ —BE GY & JOANN _ STRMMBERG #2 544423.2 2775528.70 2021790 LOWE_LL #2 584152.01 2783381.99 2021810 _ CORNHUSKER #4 543355.96 2774054.90 Well —Location —Evergreen Pared.xis i o2V77 STATE OF ALASKA IP NOTICE TO PUBLISHER ADVERTISING ORDER NO. ADVERTISING INVOICE MUST BE IN TRIPLICATE SHOWING ADVERTISING ORDER NO., RTIFIED p 0.02314010 AFFIDAVIT OF PUBLICATION PART 2 OF THIS FORM) WITH COPY OF ORDER ATTACHED / S ADVERTISEMENT MUST BE SUBMITTED WITH INVOICE < F AOGCC AGENCY CONTACT DATE OF A.O. R 333 W 7th Ave, Ste 100 Jody Colombie August 16 2002 ° Anchorage, AK 99501 PHONE PCN M o Anchorage Daily News DATES ADVERTISEMENT REQUIRED: August 17, 2002 P O Box 149001 Anchorage, AK 99514 THE MATERIAL BETWEEN THE DOUBLE LINES MUST BE PRINTED IN ITS ENTIRETY ON THE DATES SHOWN. SPECIAL INSTRUCTIONS: Account #STOF0330 Advertisement to be published was e-mailed Type of Advertisement X Legal ❑ Display ❑ Classified El Other (Specify) SEE ATTACHED PUBLIC HEARING > [ „=' AOGCC 333 W. 7th Suite 100 > Ave., PAGE 1 OF TOTAL OF ALL PAGES$ v.f _ Anchorage, AK 99501 2 PAGES REF ITYPE I NUMBER AMOUNT DATE COMMENTS 1 VEN 2 ARC 02910 3 4 FIN AMOUNT SY CC PGM LC ACCT FY NMR DIST LID 1 03 02140100 73540 2 3 4 REQUISITIONED BY. \1 % i ' DIVISION APPROVAL: i i v 02-902 (Rev. 3/94) Publisher/Original Copies: Department Fiscal, Department, Receiving AO.FRM Notice of Public Hearing STATE OF ALASKA Alaska OR and Gas Conservation Commission Re: Evergreen Resources (Alaska) Corp. Pioneer Unit, Matanuska, Susitna Borough Evergreen Resources (Alaska) Corp. by letter dated August 15, 2002, has requested an exemption from the gas detection equipment requirements of 20 AAC 25.066. The Commission has tentatively set a public hearing on this application for September 19, 2002 at 1:30 pm at the Alaska Oil and Gas Conservation Commission at 333 West 7th Avenue, Suite 100, Anchorage, Alaska 99501. A person may request that the tentatively scheduled hearing be held by filing a written request with the Commission no later than 4:30 pm on September 3, 2002. If a request for a hearing is not timely filed, the Commission will consider the issuance of an order without a hearing. To learn if the Commission will hold the public hearing, please call 793-1221. In addition, a person may submit written comments regarding this application to the Alaska Oil and Gas Conservation Commission at 333 West 71h Avenue, Suite 100, Anchorage, Alaska 99501. Written comments must be received no later than 4:30 pm on September 17, 2002 except that if the Commission decides to hold a public hearing, written comments must be received no later than 9:00 am on September 19, 2002. If you are a person with a disability who may need a special modification in order to comment or to attend the public hearing, please contact Jody Colombie at 793-1221 before September 5, 2002. Cam my Oechsli Taylor Chair Published Date: August 17, 2002 ADN AO# 02314010 *nchorage Daily News - Affidavit of Publication 1001 Northway Drive, Anchorage, AK 99508 PRICE OTHER OTHER OTHER OTHER OTHER GRAND AD # DATE PO ACCOUNT PER DAY CHARGES CHARGES #2 CHARGES #3 CHARGES #4 CHARGES #5 TOTAL 532873 08/17/2002 02314010 STOF0330 $128.78 $128.78 $0.00 $0.00 $0.00 $0.00 $0.00 $128.78 STATE OF ALASKA THIRD JUDICIAL DISTRICT Lorene Solivan, being first duly sworn on oath deposes and says that she is an advertising 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 newspaper. That the annexed is a copy of an advertisement as it was published in regular issues (and not in supplemental form) of said newspaper on the above dates and that such newspaper was regularly distributed 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 individtja}s-. ,,,,,, Subscribed and swor to me efore this date: Notary Public in and for the State of Alaska. Third Division. Anchorage, Alaska MY rt lo pL► 's.la, . ..- fi4 OTAR AUMVC OF A Notice of Publlc Nearing STATE OF ALASKA Alaska Oil and Gas Conservation Commission Re: Evergreen Resources (Alaska) Corp. Pioneer Unit, Matanuska, Susitno Borough; Evergreen Resources (Alaska) Corp. by letter dated August 15, 2002, has requested an exemption from the gas detection equipment requirements of 20 AAC 25.066. The Commission: has tentatively set a public hear- ingon this application for September. 192002ot 1:30 Pm at the, Alaska Oil and GasConservation than 4:30 pm on "September 3,.2002. If a request for a hearing is not timely filed, the Commission will consider the issuance of on order without a hearing. To learn if the Commission Wilt hold the public hearing, please call 793-1221, .In addition, a person may submit written corn ments regarding this application to the Alaska Oi) and Gas Conservation Commission at333 West'7th Avenue, Suite 100, Anchorage; Alaska 99501. Writ ten comments must be received no later than 4:f Pm on September 17, 2007:except that if the Com on September 19, 2002. If you are a person with a disability who may, need a -special modification in order to commentar to attend the public hearing, please contact Jody Co Zombie at 793-1221 before September 5, 2002. Commv Oechsli Taylor Chair Publish: August 17, 2002 AO#023140..10 STATE OF ALASKA ADVERTISING ORDER NO. ) RTIFIEO AO.02314010 ADVERTISING AFFIDAVIT AFFIDAVIT OF PUBLICATION (PART 2 OF THIS FORM WITH ATTACHED COPY OF ORDER ADVERTISEMENT MUST BE SUBMITTED WITH INVOICE :..: 001111 R IT F AOGCC AGENCY CONTACT DATE OF A.O. R 333 West 71h Avenue, Suite 100 Jody Colombie August 16, 2002 ° Anchorage, AK 99501 PHONE PCN M DATES ADVERTISEMENT REQUIRED: o Anchorage Daily News August 17, 2002 P O Box 149001 Anchorage, AK 99514 THELINES MUST BE PRINTED IN ITS ON THE DATES SHOWN. SPECIAL INSTRUCTIONS: Account #STOF0330 AFFIDAVIT OF PUBLICATION United states of America REMINDER State of ss INVOICE MUST BE IN TRIPLICATE AND MUST REFERENCE THE ADVERTISING ORDER NUMBER. division. A CERTIFIED COPY OF THIS AFFIDAVIT OF PUBLICATION MUST BE SUBMITTED WITH THE INVOICE. Before me, the undersigned, a notary public this day personally appeared ATTACH PROOF OF PUBLICATION HERE. who, being first duly sworn, according to law, says that he/she is the of Published at in said division and state of and that the advertisement, of which the annexed is a true copy, was published in said publication on the day of 2002, and thereafter for consecutive days, the last publication appearing on the day of . 2002, and that the rate charged thereon is not in excess of the rate charged private individuals. Subscribed and sworn to before me This _ day of 2002, Notary public for state of My commission expires 02-901(Rev. 3/94) AO.FRM Page 2 PUBLISHER NOTICE TO PUBLISHER UST BE IN TRIPLICATE SHOWING ADVERTISING ORDER NO. E John Katz Daniel Donkel SD Dept of Env & Natural Resources State of Alaska 2121 North Bayshore Drive Ste 1219 Oil and Gas Program Alaska Governor's Office Miami, FL 33137 2050 West Main , Ste #1 444 North Capitol St., NW, Ste 336 Rapid City, SD 57702 Washington, DC 20001 Alfred James Christine Hansen Citgo Petroleum Corporation 107 North Market Street, Ste 1000 Interstate Oil & Gas Compact Comm PO Box 3758 Wichita, KS 67202-1822 Excutive Director Tulsa, OK 74136 PO Box 53127 Oklahoma City, OK 73152 Conoco Inc. Mir Yousufuddin Mary Jones PO Box 1267 US Department of Energy XTO Energy, Inc. Ponca City, OK 74602-1267 Energy Information Administration Cartography 1999 Bryan St., Ste 1110 810 Houston St., Ste 2000 Dallas, TX 75201-6801 Ft. Worth, TX 76102-6298 Gregg Nady Michael Nelson Paul Walker Shell E&P Company Purvin Gertz, Inc. Chevron Onshore Exploration & Development Library 1301 McKinney Rm 1750 PO Box 576 600 Travis , Ste 2150 Houston, TX 77010 Houston, TX 77001-0576 Houston, TX 77002 G. Scott Pfoff G. Havran David McCaleb Aurora Gas, LLC Gaffney, Cline & Associations IHS Energy Group 10333 Richmond Ave, Ste 710 Library GEPS Houston, TX 77042 1360 Post Oak Blvd., Ste 2500 5333 Westheimer, Ste 100 Houston, TX 77056 Houston, TX 77056 William Holton, Jr. T.E. Alford Texico Exploration & Production Marathon Oil Company ExxonMobil Exploration Company PO Box 36366 Law Department PO Box 4778 Houston, TX 77236 5555 San Fecipe St. Houston, TX 77210-4778 Houston, TX 77056-2799 Chevron USA W. Allen Huckabay Donna Williams Alaska Division Phillips Petroleum Company World Oil PO Box 1635 Exploration Department Statistics Editor Houston, TX 77251 PO Box 1967 PO Box 2608 Houston, TX 77251 Houston, TX 77252 Chevron Chemical Company Shawn Sutherland Kelly Valadez Library Unocal Tesoro Refining and Marketing Co. PO Box 2100 Revenue Accounting Supply & Distribution Houston, TX 77252-9987 14141 Southwest Freeway 300 Concord Plaza Drive Sugar Land, TX 77478 San Antonio, TX 78216 James White Doug Schultze Robert Gravely Intrepid Prod. Co./Alaskan Crude XTO Energy Inc. 7681 South Kit Carson Drive 4614 Bohill 3000 North Garfield, Ste 175 Littleton, CO 80122 SanAntonio, TX 78217 Midland, TX 79705 George Vaught, Jr. Scott Webb Jerry Hodgden PO Box 13557 Ocean Energy Resources, Inc. Hodgden Oil Company Denver, CO 80201-3557 1670 Broadway, Ste 2800 408 18th St. Denver, CO 80202-4826 Golden, CO 80401-2433 John Levorsen Kay Munger John F. Bergquist 200 North 3rd St., #1202 Munger Oil Information Service, Inc Babson and Sheppard Boise, ID 83702 PO Box 45738 PO Box 8279 Los Angeles, CA 90045-0738 Long Beach, CA 90808-0279 Samuel Van Vactor Thor Cutler OW-137 Michael Parks Economic Insight Inc. US EPA egion 10 Marple's Business Newsletter 3004 SW First Ave. 1200 Sixth Ave. 117 West Mercer St, Ste 200 Portland, OR 97201 Seattle, WA 98101 Seattle, WA 98119-3960 Duane Vaagen Julie Houle Williams VanDyke Fairweather State of Alaskan DNR State of Alaska 715 L St., Ste 7 Div of Oil & Gas, Resource Eval. Department of Natural Resources Anchorage, AK 99501 550 West 7th Ave., Ste 800 550 West 7th Ave., Ste 800 Anchorage, AK 99501 Anchorage, AK 99501 Steve E. Mulder Richard Mount Cammy Taylor Dorsey & Whitney State of Alaska 1333 West 11th Ave. 1031 West 4th Ave., Ste 600 Department of Revenue Anchorage, AK 99501 Anchorage, AK 99501 500 West 7th Ave., Ste 500 Anchorage, AK 99501 Robert Mintz Susan Hill Ed Jones State of Alaska State of Alaska, ADEC Aurora Gas, LLC Department of Law EH Vice President 1031 West 4th Ave., Ste 200 555 Cordova St. 1029 West 3rd Ave., Ste 220 Anchorage, AK 99501 Anchorage, AK 99501 Anchorage, AK 99501 Tim Ryherd Jim Arlington Trustees for Alaska State of Alaska Forest Oil 1026 West 4th Ave., Ste 201 Department of Natural Resources 310 K St., Ste 700 Anchorage, AK 99501-1980 550 West 7th Ave., Ste 800 Anchorage, AK 99501 Anchorage, AK 99501 Mark Wedman Mark Dalton Schlumberger Halliburton HDR Alaska Drilling and Measurements 6900 Arctic Blvd. 2525 C St., Ste 305 3940 Arctic Blvd., Ste 300 Anchorage, AK 99502 Anchorage, AK 99503 Anchorage, AK 99503 John Harris Ciri Mark Hanley NI Energy Development Land Department Anadarko Tubular PO Box 93330 3201 C St, Ste 603 3301 C St., Ste 208 Anchorage, AK 99503 Anchorage, AK 99503 Anchorage, AK 99503 Baker Oil Tools Judy Brady Arlen Ehm 4730 Business Park Blvd., #44 Alaska Oil & Gas Associates 2420 Foxhall Dr. Anchorage, AK 99503 121 West Fireweed Lane, Ste 207 Anchorage, AK 99504-3342 Anchorage, AK 99503-2035 Greg Noble Jeff Walker Jill Schneider Bureau of Land Management US Minerals Management Service US Geological Survey Energy and Minerals Regional Supervisor 4200 University Dr. 6881 Abbott Loop Rd 949 East 36th Ave., Ste 308 Anchorage, AK 99508 Anchorage, AK 99507 Anchorage, AK 99508 Rose Ragsdale Jim Scherr s Thomas R. Marshall, Jr. Rose Ragsdale & Associates US Minerals Management Service 1569 Birchwood Street 3320 E. 41 st Ave Resource Evaluation Anchorage, AK 99508 Anchorage, AK 99508 949 East 36th Ave., Ste 308 Anchorage, AK 99508 Chuck O'Donnell Richard Prentki Paul L. Craig Veco Alaska,lnc. US Minerals Management Service Trading Bay Energy Corp 949 East 36th Ave., Ste 500 949 East 36th Ave., 3rd Floor 5432 East Northern Lights, Ste 610 Anchorage, AK 99508 Anchorage, AK 99508 Anchorage, AK 99508 Gordon Severson Jim Ruud Kristen Nelson 3201 Westmar Cr. Phillips Alaska, Inc. IHS Energy Anchorage, AK 99508-4336 Land Department PO Box 102278 PO Box 100360 Anchorage, AK 99510-2278 Anchorage, AK 99510 Perry Markley Jordan Jacobsen Robert Britch, PE Alyeska Pipeline Service Company Alyeska Pipeline Service Company Northern Consulting Group Oil Movements Department Law Department 2454 Telequana Dr. 1835 So. Bragaw - MS 575 1835 So. Bragaw Anchorage, AK 99517 Anchorage, AK 99515 Anchorage, AK 99515 Jeanne Dickey David Cusato Tesoro Alaska Company BP Exploration (Alaska), Inc. 600 West 76th Ave., #508 PO Box 196272 Legal Department Anchorage, AK 99518 Anchorage, AK 99519 PO Box 196612 Anchorage, AK 99518 J. Brock Riddle Kevin Tabler Sue Miller Marathon Oil Company Unocal BP Exploration (Alaska), Inc. Land Department PO Box 196247 PO Box 196612 PO Box 196168 Anchorage, AK 99519-6247 Anchorage, AK 99519-6612 Anchorage, AK 99519-6168 BP Exploration (Alaska), Inc. Dudley Platt Bob Shavelson Land Manager D.A. Platt & Associates Cook Inlet Keeper PO Box 196612 9852 Little Diomede Cr. PO Box 3269 Anchorage, AK 99519-6612 Eagle River, AK 99577 Homer, AK 99603 Shannon Donnelly Kenai Peninsula Borough James Gibbs Phillips Alaska, Inc. Economic Development Distr PO Box 1597 HEST-Enviromental PO Box 3029 Soldotna, AK 99669 PO Box 66 Kenai, AK 99611 Kenai, AK 99611 Penny Vadla Claire Caldes Kenai National Wildlife Refuge Box 467 US Fish & Wildlife Service Refuge Manager Ninilchik, AK 99669 Kenai Refuge PO Box 2139 PO Box 2139 Soldotna, AK 99669-2139 Soldotna, AK 99669 John Tanigawa Richard Wagner Cliff Burglin Evergreen Well Service Company PO Box 60868 PO Box 131 PO Box 871845 Fairbanks, AK 99706 Fairbanks, AK 99707 Wasilla, AK 99687 Harry Bader State of Alaska Department of Natural Resources 3700 Airport Way Fairbanks, AK 99709 North Slope Borough PO Box 69 Barrow, AK 99723 Bernie Karl K&K Recycling Inc. PO Box 58055 Fairbanks, AK 99711 Senator Loren Leman State Capitol Rm 113 Juneau, AK 99801-1182 0 Williams Thomas Arctic Slope Regional Corporation Land Department PO Box 129 Barrow, AK 99723 • EVERGREEN RESOURCES (ALASKA) CORP. A Subsidiary of Evergreen Resources, Inc. August 15, 2002 Mr. Dan T. Seamount Commissioner Alaska Oil and Gas Conservation Commission 333 West 7"' Avenue, Suite 100 Anchorage, AK 99500 RE: Waiver for exception from 20AAC 25.066 Gas Detection Dear Commissioner Seamount, Alaskat7i1"G,m 4"mage Evergreen Resources is the current operator for the Pioneer Unit, Matanuska Susitna Borough and plans to drill eight wells to test the Tyonek Coals in September 2002. In this letter, Evergreen Resources Alaska requests an exemption from 20 AAC 25.066, Gas Detection for the upcoming drilling program. 20 AAC25.066 sets forth the minimum gas detection equipment for drilling and work over rigs. This portion of the regulations are included at the end of this letter. Evergreen requests a waiver from this regulation since (1) there is no H2S gas from the shallow gas formations in the Pioneer Unit and (2) due the air drilling system that we employ. To date, 12 wells have been drilled on or directly adjacent to the Pioneer Unit. None of these wells reported 112S. We therefore believe there is sufficient evidence that no H2S exists. Secondly, due to the truck mounted drilling system that Evergreen employs, sensors cannot be placed in the cellar or substructure and next to the shale shaker. Methane gas, the primary constituent of natural gas from coal bed methane, will evolve from the air drilling process. However, these gasses are blown well away from the drill rig, out the 30 foot blooey line and are prevented from flowing up the drill pipe due to check valves (floats). We are confident we can safely drill, complete and produce coal bed methane wells in Alaska using our well -proven systems and methods discussed in earlier correspondences. This year alone, we have drilled over 40 miles of coal bed methane wells in the US, UK and Ireland with no accidents. We hope we can employ the same types of drilling measures, necessary for successful coal bed methane development, in Alaska. Thank you for considering Evergreen's request. Please contact me if you have questions. My telephone number is 907-841-0000 and my e-mail is JohnT EvergreenGas.com Sincerely, AOJ John J Tanigawa P.O. Box 871834 Wasilla, Alaska 99887 Tel: 907-357-8130 Fax: 907-357-8340 RESOURCES (ALASKA) CORP. A Subsidiary of Evergreen Resources, Inc, 20 AAC 25.066 GAS DETECTION. (a) Drilling and workover rigs must meet the following minimum requirements for methane and hydrogen sulfide gas detection: (1) the methane detection system must have a minimum of three sensing points; one sensing point must be under the substructure near the cellar, one must be over the shale shaker, and one must be above the drill rig floor near the driller's station or above the drilling platform; if the mud pits are remote from the shale shaker and enclosed, a fourth sensor must be located over the mud pits; (2) methane sensors must be placed to detect a "lighter -than -air" gas; (3) the hydrogen sulfide detection system must have a minimum of three sensing points; one sensing point must be under the substructure near the cellar, one must be near the shale shaker, and one must be above the drill rig floor near the driller's station or above the drilling platform; the commission will require additional sensors as the commission considers necessary for safety, such as at the entrance to living quarters if they are adjacent to the drill rig, or over the mud pits if they are remote from the shaker and enclosed; (4) hydrogen sulfide sensors must be placed to detect a "heavier-than-air" gas; (5) sensors must be automatic, acting independently and in parallel, and with one - minute minimum sampling intervals; (6) each detection system must include separate and distinct visual and audible alarms; the visual alarm must signal the low level gas alarm and the audible alarm the high level gas alarm; an audible alarm may have an "acknowledge" button; (7) the methane low level gas alarm must be set at not over 20 percent LEL; the high level alarm must be set at not over 40 percent LEL; (8) the hydrogen sulfide low level gas alarm must be set at 10 ppm; the high level alarm must be set at not over 20 ppm; (9) each alarm must be automatic and must be visible and audible from the driller's or operator's station; the hydrogen sulfide alarm must be audible throughout the drilling location, including the camp buildings. (b) A gas detection system that continuously performs self -checking or diagnostics must be function -tested when a BOP stack is initially installed after a drill rig is set up, when a commission -witnessed BOP test occurs, and no less frequently than once every six months. Other gas detection systems must be calibrated and tested when a BOP stack is initially Installed after a drill rig is set up, when a commission witnessed BOP test occurs, and no less frequently than once every 30 days. The operator shall maintain at the drill rig an accessible record of gas detection system tests and calibrations. (c) A failure in a gas detection system must be reported to the commission within 24 hours after the failure. The commission will, in its discretion, require well operations to be discontinued if a gas detection system fails. History - Eff. 1117199, Register 152 Authority - AS 31.05.030 P.O. Box 871834 Wasdla, MUM 9%87 Tel: 907357-8130 Fax: 907-357.8340 • 0 to-j6 A- z-/3/0 3 /AA L- 16 2/7/o.7 P�,t STATE OF ALASKA ALASKA OIL AND GAS CONSERVATION COMMISSION REPORT FOR SUNDRY APPROVALS 1, Type of Request Abandon C1 Suspend 13 Operation Shuldown M Re-enter sww" well 0 After Casing 0 fteir WON 0 Plugging 0 Time extension 0 Stimulate a CtwVe Apinved Pmgmm 13 Pull Tubing 0 vartanoe W Perforate 0 4 Other M Z Nan neof Operator Evergreen Resources Aftska S.Type ofWes Deve4ment 0 6. Datum elevation (DF or KB): Exploratory 111 St*whic 0 453 ft KB (4 ft AGL) 3. Address., P.O. BOX 8711845 7. Unit or Property Name: Wasills, AK 99687 Service 0 Pioneer unit 4. Location of well at surface: NEMofSec 3OTv* i8North RrgiWest, Seward MwMan 8. Well number. W FSL & 471'FEL OF SEC Bering No 3 At top of productive interval: 9. Permit number- 202-177 At effective depth: 10. AN Number sa409-3oo19i-w Total depth: 11. Field and Pool: Piortw 12. Present well condition summary Total depth: Measured 3750 feet Plugs (measured) none true vertical feel Effective depth: measured 3750 feet Junk (measured) none true vertical feet Casing: Length size cenw*ed Measured Depth True vertical depth Structural Conductor 275 12-314" 10 sx on bot & 10 sx on top 279' Surface 39r 8-518" 146 ox I&S Ppg CIO$$ G, ClrC tD SUrftW 401' Intermediate Production 3717' 5-Irt 511 sx 13.7 ppg Class 0, TOC +1. 10 ft 3721' Liner Perforation do*- Measured none True vertical none Tubing (size, grade, and measured depth) none Packers and SSSV (type and measured depth) none 13. Attachments: Description Summary of Proposal m Detailed Operations Program M BOP Sketch 0 14. Estimated date for commencing operation Ifi. Status of well classilloation as: M003 Oil ❑ Gas Suspended 171 Service 0 16. If proposal was verbally approved Name of approver Dab Appioved 17. 1 hereby cerbVithat the yegoing is true and correct to the best of my WwMWp, Signed AA111111013PI17� Title Alaska Projects Manger Date 2111M FOR COMMISSION USE ONLY Conditions of approval: Notify Canmission so representative may witness Appioal No. Sr ZPugin*_gdty[3 i"kri" d L 1107 *a W&L a ciewace 13 an" ntegrity test 0 Su required 1 Pe. Alf<: Z-,�, 7,.,; AA-C L5, 2- 17 "I I (k) cui ct-I 7� Approved by order ofthe Commisslo!� �A§&,Aj Qjr.,NED BY Commissioner Date /zV Form 1043 Rev 06115S L. Bill (,W RBOMS BFL SUBMIT INT11066ATre P red." 4 - - W► RE RESOURCES (ALASKA) CORP. A Program Summary Pioneer Unit Bering No. 3 API: 50-0009-20019 Section 1 Township 18 North Range 1 West Matanuska Susitna Borough, Alaska The subject well was drilled in November 2002 as a coal bed methane exploration well to a depth of 3750 ft KB. 5-1/2" casing was run and the well was cemented to surface. During these operations, air was used and there were no incidents that would cause concern from a well control standpoint. The goal of this well work is to determine formation pressure within the Tyonek coals. This will be achieved by 1st swabbing down the casing perforating a single coal seam and running in with a silicon pressure gauge below a Lockset Packer and 2-7/8" tubing. The pressure gauges will be left in the hole for approximately 2 weeks and then retrieved. In all the work, Evergreen's work over rig will be used. Proposed Derforations are at a deDth of and are detailed below. PROPOSED PERFORATIONS Interval Formation Shots/ft Size Holes Perf Description 3382-3386 T onek 4 0.48" 1 16 1 19 gr, premium deep penetrating Following this fracture treatment, the subject well will be fracture stimulated. Evergreen will utilize its own international frac fleet, single -double work over rig and water trucks currently residing in Wasilla. All frac's will occur down 2-7/8" 6.7 ppf, K-55, 8 rd, EUE tubing. As specified in 20 AAC 25.280 (b)(4), fresh water will be used to control the well. This wellbore has been entered on four separate occasions and on all occasions, fresh water (8.35 lb/gal) fluid was sufficient to control the well. As specified in 20 AAC 25.280 (b)(5), the pressure gradient is normal. Thus bottom hole pressure on the bottom most interval is (3,386 ft x 0.435 psi/ft) or 1,473 psig. We plan on using 3,000 psi BOPE. Regulation Exceptions 20 AAC 25.285: • Evergreen requests that our manual BOPE, as illustrated on the next page be acceptable for this operation. • Evergreen requests that the BOP be function tested only. During air drilling, the well was completely evacuated with liquids and the well did not flow gas. • Evergreen requests that the kill pump remain in the yard and be called out if necessary. Coals have not yet desorbed and as drilling showed, there is no free gas in the system. 20 AAC 25.287: • Evergreen requests that our Full bore lubricator on top of our BOPE is acceptable. This system is shown two pages hence. Office: 1075 Check Street, Suite 202 Wasilla, AK 99654 Mail: P.O. Box 871845 Wasilla, AK 99687 Tel:907-357-8130 Fax:907-357-8340 www.EvergreenGas.com VERGRE RESOURCES (ALASKA) CORP. A 0E ,*,,. BOP Detail Blow Out Prevention E ui ment for Fracturing and Well Clean -out Operations A schematic of Evergreen's BOPE is shown in the adjacent figure and detailed in the table below. Here we propose us!Fg 3,000 psi, 7-1/16 inch BOPE manually operated system. The BOP is attached to the 2- 7/8"x7" tubing head which is our spool in this operation. Evergreen uses a similar set-up in its operations in the Raton Basin. In this well testing type of operation, we normally do not use a BOP. No hem Manufacturer Size in Psi Rating Manufacture Yeah 1 Valve FMC 7-1/16 3,000 2000 2 Valve FMC 7-1/16 3,000 2000 3 Valve FMC 7-1/16 3,000 2000 4 1 Valve FMC 7-1/16 3,000 2000 5 Wellhead/Spool Wellhead, Inc. T' csg 3,000 1996 est 6 BOP: Blind Ram Townsend Manual Operated 7-1/16 3,000 2001 7 BOP: Pie Ram Townsend Manual Operated 7-1/16 3,000 2001 8 StrippingStdpping Head I High Tech Tools 7-1/16 3,000 2001 The blow out preventer is a Townsend (Odessa, TX) double gate with blind rams on the bottom and pipe rams on the top. This BOP is manually operated using two wheels. Above the BOP is a High Tech Tools (Aztec, NM) stripping head which functions as an annular preventer. The body is rated to 3,000 psi and the insert rubber, manufactured by Triple M (Odessa, TX), designed for 2-7/8" tubing, is pressure rated to 1,000 psi. Four manually activated FMC block valves are attached to the spool — two for the kill like and the remaining two to the choke line. The kill line is attached to an Evergreen Well Service frac truck or cement truck. Three inch 15M psi treating iron and/or 3 inch 3M psi hose will be used to connect the pump to the spool. A 15M psi valve and check valve also exists at the pump truck. Evergreen Requests that this pump truck be located at the yard and called out if needed. The choke line connects the wellhead to the lined pit. Two 3,000 psi block valves at the spool will be connected to two or three inch 3M pipe running to the 500 bbl frac tank. In line with the choke line are two 3M psi block valves located at least 20 feet from the wellhead. A i conventional choke manifold is not specified in this procedure due to the shallow depths, lack of hydrocarbons, and due to our prior experience with this well bore. Office: 1075 Check Street, Suite 202 Wasilla, AK 99654 Mail: P.O. Box 871845 Wasilla, AK 99687 Tel:907-357-8130 Fax:907-357-8340 www.EvergreenGas.com E w � : N nrso nn (At,A$KA) CORP, BOP Detail (Continued) Blow Out Prevention Equipment for Wireline Operations Wire line operations in this procedure consist of (1) running a cement bond log at the beginning of the job, (2) setting three RBP's and (3) perforating 135 feet of casing at a perforation density of 4 shots per foot. In all of these operations, a full bore lubricator in conjunction with our BOP set-up will be used as our method of well control. Shown in the adjacent figure is a schematic of our proposed set-up. The table below is a detail listing of the equipment. The full bore lubricator is 20 feet in length and is fabricated out of 5-1/2", 17 lb/ft, K-55 casing. It has a pressure rating of 3,000 psig working (6,000 psi test). An oil saver seals the wire line as it passes through the lubricator is at top. Located at the bottom of the full bore lubricator is a hammer union to allow quick access to guns, setting tools and logging tools during the job. No— �� ' item Manufacturer Size in Psi Rahn: Mafnufaciure � ;bear 1 Valve FMC 7-1116 3,000 2001 2 Valve FMC 7-1/16 3,000 2001 3 Valve FMC 7-1/16 3,000 2001 4 1 Valve FMC 7-1/16 3,000 2001 5 Spool High Tech Tools 7-1/16 3,000 2001 6 BOP: Blind Ram Townsend Manual Operated 7-1/16 3,000 2001 7 BOP: Pie Ram Townsend Manual Operated 7-1/16 3,000 2001 8 Full bore lubricator Patterson Wireline 5-1/2 3,000 1999 ? r< Office: 1075 Check Street, Suite 202 Wasilla, AK 99654 Mail: P.O. Box 871845 Wasilla, AK 99687 Tel:907-357-8130 Fax:907-357-8340 www.EvergreenGas.com RESO> RCES (ALASXA) CORP. A at EftVmm PA mom sr. Pressure Test Procedure Pioneer Unit Bering No. 3 API: 50-0009-20019 Section 1 Township 18 North Range 1 West Matanuska Susitna Borough, Alaska Elevations: GL: 449 ft KB: 453 ft (4 ft AGL) Objective: Run pressure gauges below packer to determine formation pressure. History: Subject well spud on November 5, 2003. Well finished drilling, running casings and cemented on November 7, 2003. Air drilling showed no hole problems and no well control issues. Preparation: 1. AOGCC: Contact AOGCC (907-279-1433), Winton Aubert, 48 hours prior to operations. 2. Tanks: None. 3. Water: If well control incident occurs, mobilize both 80 bbl water trucks from yard as the source of kill fluid. Yard is 3.5 miles away on blacktop roads / highways. 4. Pumping Services: Evergreen Well Service cement unit will be used if the well needs to be killed. 5. Haul Tubing: Haul 125 joints of tubing to location. 6. Forced Air Heater: One 500,000 BTU forced air heater needed to keep crew warm. Personnel: Engineer in Charge: Tom Hemler 719-680-1378 2r,d in Engineer: Shane Gagliardi 719-859-5072 Tool Pusher: Michael Polly 719-342-5600 EWS Manager: Eric Vaughan 303-881-3557 Accommodations: Evergreen will utilize local businesses to garner support for this project. The hotel accommodations are as follows: Evergreen Well Service: Big Lake Motel 907-892-7976 Completion Rig Crew: Big Lake Motel 907-892-7976 Patterson Wireline: Houston Lodge 907-892-6808 Tom Hemler & Mike Polly Best Western 907-373-1776 Spill Prevention: Alaska Department of Environmental conservation has strict regulations regarding spills. All equipment will have plastic liners underneath them. Liners will also be run around wellhead. A transfer pump from the cellar to the Office: 1075 Check Street, Suite 202 Wasilla, AK 99654 Mail: P.O. Box 871845 Wasilla, AK 99687 Tel:907-357-8130 Fax:907-357-8340 www.EvergreenGas.com RUOUR EB (A€*SKA) CORP. A &E �. Directions to Water Pilot 2 (From Wasilla): • West on Parks Highway 1.0 miles to Church Road • North on Church Road 2.1 miles to 2"d green gate on west side of road. • West into location. This is "2" in the map below. Casing and Tubing Data Strengths taken to 75% for Tubin and 80% of Casing Size in Weight ID in Drift in(psi) Collapse Burst (psi) Yield klbs Capacity Bbls/ft Capacity Ft/bbl Tubing 2-7/8" 6.5 2.441 2.347 5,760 5,450 54.4 0.005794 172.6 Casing 5-1/2" 17 4.892 4.767 4,910 5,320 273 0.0232 43.01 Annulus above - - - - - - 0.0152 65.7 Office: 1075 Check Street, Suite 202 Wasilla, AK 99654 Mail: P.O. Box 871845 Wasilla, AK 99687 Tel:907-357-8130 Fax:907-357-8340 www.EvergreenGas.com MIN RE$ URC$$ (ALASKA) CORP, A ®F Procedure Installation of Gauges 1. MIRU Evergreen Rig No. 5. 2. NU & Function Test 3000 lb manual BOP, Stripping Head. RU flow -back lines to pit and RU Kill line. 3. Using 5-1/2" casing scraper, seating nipple on 2-7/8" tubing, clean casing to PDTD at 3,688 ft KB. 4. Using tubing swab, swab casing down to +/- 3,100 ft KB. Flow water to lined pit. 5. POOH with 2-7/8" tubing, seating nipple and casing scraper. 6. MIRU Patterson Wireline. Using fullbore lubricator, perforate coal seam at 3382-3386 using 4 spf 19 gr premium charges. Correlate to CBM log ran on 15 November 2003. Log shows excellent cement from PBTD to surface. 7. RDMO Patterson Wireline. 8. RIH with seating nipple, Weatherford down -hole Shutoff Tool (or blank off tubing above packer, Baker Lockset on 2-7/8" tubing. On bottom of Lockseti1_1 run a 4 ft perforated sub with bull plug on bottom. Inside 4 ft sub, place 3/a" programmable 1,500 psi silicone crystal gauges. Program for 1 minute samples for 60 days. 9. Set packer at +/- 3,300 ft KB. Place 2" valve on top of 2-7/8" tubing. Place valve on tubing. Also place valves and pressure gauge to measure tubing - casing annulus pressure. 10. Clean Location 11. RDMO Evergreen Well Service. 12. Check pressure gauges within 24 hours to ensure that packer and Weatherford downhole setting tool have sealed. Removal of Pressure Gauges 1. After 2 weeks or at the direction of Evergreen Alaska Engineering, MIRU Evergreen Rig No. 5. 2. Check Pressure gauges and proceed with program if pressure is zero on both tubing and backside. 3. NU BOP and function test. r 4. Unseat Packer. Laydown test assembly and retrieve data from pressure f' gauge. At site, download data onto computer and ensure that a good test was achieved. If not, fix the problem and re -run gauges by following steps 8 through 12 for "Installation of Gauges". 5. Clean location & Bring back tubing, packer, perforated sub, etc to yard. 6. RDMO EWS Rig No. 5 Office: 1075 Check Street, Suite 202 Wasilla, AK 99654 Mail: P.O. Box 871845 Wasilla, AK 99687 Tel:907-357-8130 Fax:907-357-8340 www.EvergreenGas.com E .� RE RESOURCES (ALASKA) 00111P. A a Evergreen Resources Alaska Corp Pioneer Unit Bering No. 3 API: 50-0009-20019 Section 1 Township 18 North Range 1 West Matanuska Susitna Borough, Alaska 275 ft KB 397 ft KB PBTD 3,688 ft N Insert 3,717 ft K 3,717 ft KE Driller TD 3,750 ft KB 12-3/4"" Conductor Casing 12-3/4", 50 ppf, 0-275 ft KB 8-5/8" Surface Casing 24 ppf, 0 — 397 ft KB Cement 146 sx 15.8 ppg Circ to Surface 5-1/2" Production Casing 17 ppf, 0 — 3,717 ft KB cement with 511 sx 13.7 ppg cement. .irc to Surface. 3roposed Perforations (3,382-3,386) — 4 ft t JSPF,19 gr Charges Office: 1075 Check Street, Suite 202 Wasilla, AK 99654 Mail: P.O. Box 871845 Wasilla, AK 99687 Tel:907-357-8130 Fax:907-357-8340 www.EvergreenGas.com .. o. .GR R£SOVROES (AL&SKAj CORP. February 1, 2003 Ms. Camille Oechsli Taylor Commissioner Alaska Oil and Gas Conservation Commission 333 W. 7th Ave #100 Anchorage, Alaska, 99501-3539 RE: Form 10-403 — Run Pressure Gauges to determine reservoir pressure Pioneer Unit Bering No. 3 API:50-0009-20019 Permit:202-177 Section 30 Township 18 North Range 1 West Matanuska Susitna Borough, Alaska Dear Ms. Taylor, Pursuant to 20 AAC 25.270 -- Initial Reservoir Properties, Evergreen Resources Alaska Corporation submits the following 10-403 to run pressure gauges to determine reservoir pressure of the subject well. This is a simple and straight forward procedure will take 1 day, as proposed. We plan to begin this operation on Saturday February 8, 2003. / Evergreen Resou es (Alaska) Corp Jo n J. Taniga a Alaska Projects Manager Attachments Office: 1075 Check Street, Suite 202 Wasilla, AK 99654 Mail: P.O. Box 871845 Wasilla, AK 99687 Tel:907-357-8130 Fax:907-357-8340 www.EvergreenGas.com VOR i� �+ RESOURCES (ALASKA) CORP. A Subsidiary of Evergreen Resources, Inc. Friday, December 06, 2002 Mr. Winton Aubert Petroleum Engineer Alaska Oil and Gas Conservation Commission 333 West 7th, Suite 100 Anchorage, AK 99501 RE: Sundry Notice: Operational Shutdown Evergreen Resources Alaska Corp Bering 3 API No: 50-009-20019-00 Permit No: 202-177 r NE/SE Section 30 Twp 18 North Ring 1 West, Seward Meridian Pioneer Unit, Matanuska-Susitna Borough Dear Mr. Aubert, As requested, attached is a sundry notice for the subject well and a well bore diagram. This well was spud on November 5, 2002 and was finished drilling on November 7, 2002. Currently the well is awaiting a directional survey and a completion program. Evergreen requests an "Operational Shutdown" for the holidays. We expect to begin fracture stimulation, using our own equipment, during the first quarter 2003. As discussed, all information regarding this well will be submitted after the well is completed. Thank you for your time and consideration. Please call me if you have any questions: office: 907-357-8130 & cell: 907-841-0000. Sincerely, EVERGREEN RESOURCES (ALASKA) CORP J /J/./ igawa ECEiE DEC 0 9 2002 aska, Oil & Gas Cans. Commissio P.O. Box 871845 • Wasilla, AK 99687 - TEL 907.357.8130 • FAX 907.357.8340 W6k. I2.111C2__ STATE OF ALASKA /ti"h ALASKA OIL AND GAS CONSERVATION COMMVON b;T rZI T REPORT FOR SUNDRY APPROVALS C-T i 1. Type of Request Abandon El Suspend 0 Operation Shutdown I] Re-enter suspended well 11 After Casing 0 Repair Well n Plugging 11 Time extension 0 Stimulate 0 Change Approved Program 0 Pull Tubing 11 Variance 0 Perforate 11 Other D 2. Name of Operator Evergreen Resources Alaska 5. Type of Well Development D 6. Datum elevation (DF or KB): Exploratory Stratigraphic 453 ft KB (4 ft AGL) 3. Address: P.O. Box 871845 7. Unit or Property Name: Wasilla, AK 99687 Service 0 Pioneer Unit 4. Location of well at surface: NE/SE of Sec 30 Twp 18 North Rng 1 West, Seward Meridian 8. Well number: 1523' FSL & 471' FEL OF SEC Bering No 3 At top of productive interval: 9. Permit numbey 202.177 At effective depth: 10. API Number: 50-009.20019-00 Total depth: 11. Field and Pool: Pioneer 12. Present well condition summary Total depth: Measured 3750 feet Plugs (measured) none true vertical feet Effective depth: Measured 3750 feet Junk (measured) none true vertical feet Casing: Length Size Cemented Measured Depth True vertical depth Structural Conductor 275' 12-3/4" 70 sx on bot & 10 sx on top 279' Surface 397' 8-5/8" 146 sx 15.8 ppg Class G, Circ to Surface 401' Intermediate ` Production 3717' 5-1/2" 511 sx 13.7 ppg Class G, TOC +/-10 ft 3721' Liner Perforation depth: Measured none R E C. a True vertical none _ Tubing (size, grade, and measured depth) none DEC U Y Cut Packers and SSSV (type and measured depth) none �IasRa oil & Gas < ong. o r1r'hnra5f4 13. Attachments: Description Summary of Proposal Detailed Operations Program 11 BOP Sketch 0 14. Estimated date for commencing operation 15. Status Oil of well classification as: Gas ❑x Suspended 0 Service 16. If proposal was verbally approved Name of approver Date Approved 17. 1 hereby certif that the egoing is true and correct to the best of my knowledge. • Signed Title Alaska Projects Manager Date 1216102 FOR COMMISSION USE ONLY Conditions of approval: Notify Commission so representative may witness Approval No. ' 7� Plug integrity BOP test Location clearance 11 Mechanical integrity test 11 Subsequent form required 10- I ORIGINAL SIGNED BY j,, teAx.`- t Approved by order of the Commission M L. Bill Commissioner Date Form 10-403 Rev 06/15/88 SU MIT TR LICATE ,,DBMS BFL • • Well Bore Diagram Bering No 3 Evergreen Resources Alaska Pioneer Unit NE/SE of Section 30 Twp 18 North Rng 1 West, Seward Meridian 279 ft KB 401 ft KB 3688 ft KB 3750 ft K Conductor Casing: 279 ft KB 12-3/4", heavy wall, welded connection Cemented with 70 sx on bot & 10 sx on top Surface Casing 401 ft KB 8-5/8", 23 ppf, J-55, ST&C Cemented with 146 sx 15.8 ppg Class G Circ to Surface Production Casing 3721 ft KB 5-1/2", 17 ppf, J-55, ST&C Cemented with 511 sx 13.7 ppg Class G TOC +/-10 ft PBTD 3688 ft KB Cement in Csg V=IBC-IZ==1�I RESOURCES (ALASKA) CORP. A Subsidiary of Evergreen Resources, Inc. November 4, 2002 Ms. Cammy Oechsli-Taylor, Chair Alaska Oil and Gas Conservation Commission 333 West 7th Ave., Suite 100 Anchorage, Alaska 99501 RE: Revised APD - Increase TD from 2,999 to 3,900 ft KB Bering 3 Twp 18 North Rng 1 West Seward Meridian Pioneer Unit Matanuska Susitna Borough Dear Commissioner Taylor, Evergreen Resources Alaska requests permission to drill an additional 900 feet on the subject well evaluate the Tyonek coals and sandstones. Since the additional depth requested is beyond 500 feet, please find the attached APD and a check for $100.00. On November 1, 2002, Evergreen TD'd the Baranof #4 to a depth of 3,700 ft KB. - No drilling problems were encountered. There are absolutely no indications that this well will behave differently. Thank you for your assistance. I appreciate the help you and your staff have given our company. Sincerely, EVERGREEN RESOURCES (ALASKA) CORP 0 J• 00� 04000 John J. Tanigawa Alaska Projects Manager RECEIVE) NOV 1 2 2002 " 11ska 0118, Gas Cons. Cammissi(,rl. ` nrhora'( P.O. Box 871845 • Wasilla, AK 99687 • TEL 907.357.8130 • FAX 907.3578340 STATE OF ALASKA ALASKA OIL AND GAS CONSERVATION COMMON PERMIT TO DRILL 20 AAC 25.005 a. Type of work [X] Drill a ri FFf b. Type of weService Development Gas Inge Zone ]Multiple Zone [ Re -Entry Dee en X Exploratory [ Strati ra hic Test IDevelopment Oil 2. Name of Operator 5. Datum Elevation ( F or B) 1 . held and Pool Evergreen Resources (Alaska) Corporation 404 ft DF 3' AGL) Pioneer 3. Address 6. Property Designation P.O. Box 871845, Wasilla, AK 99687 Private Location o weat Type Bond (See 20 AAC 25.025)4. 1523' FSL & 471' FEL, Sec. 30, T18N, R1 W, SM Pioneer Unit At top of productive interval Number RLB0004711 8. Well Number Same Bering #3 At total depth Amount $200M 9. Approximate spud date Same 11 /4/2002 12. Distance to nearest property Ilne Distance to nearest well 14. Number of acres in property 15. ropose ept an ) 471 ft BLM Minerals 5810 ft AK94 CBM 16,780 1 3,900' MD, TVD 16. To be completed for deviated wells 17. Anticipated pressure (see 20 AAC 25.035 (e) (2)) Kick Off Depth N/A Maximum Hole Angle vertical Maximum surface 2027 psig , At total depth (TVD) 1600 psig 18. Casing Program Setting Depth Size Specifications Top Bottom Quantity of Cement Hole Casing Weight Grade Coupling Length MD TVD MD TVD include stage data 13 12.25 48 K-55 Welded 125 3 3 125 125 26 sx. If necessary, our add'I cement at surface 11 8.625 24 K-55 STC 300 3 3 300 300 111 sx. Circulate to Surface 7.875 5.5 17 K-55 STC 3900 3 3 3900 3900 671 sx. Circulated to surface 19. To be completed for Redrill, Re-entry, and Deepen Operations. Present well condition summary Total depth: measured feet Plugs (measured) true vertical feet Effective depth: measured feet Junk (measured) true vertical feet Casing Length Size Cemented MD TVD Structural Conductor Surface Intermediate Production Liner RECEIVED N 0 V 12 2002 Perforation depth: measured true vertical Alaska OR& GasGons, Commission Ancharaae 20. Attachments [X] Filing Fee [X] Property Plat [X] BOP Sketch [X] Diverter Sketch [X] Drilling Program X Drilling Fluid Program Time vs Depth Plot Refraction Analysis [ Seabed Report 20AAC25.050 Reg. Contact Engineer Na e/ ber.• John Tanigawa (907) 841-0000 Prepared By Name/Number: John Tanigawa (907) 841-0000 21. 1 hereby certify th e, going is true and correct to the best of my knowledge Signed �— Title Alaska Projects Manager Date Commission Use Only Permit Num API Number :§'d + OIL% • IG% ^ d 1 Approval Date 1 See cover letter for other requirements Conditions of Approval: Samples Required: [ ] Yes [ ] No Mud Log Required [ ] Yes [ ] No Hydrogen Sulfide Measures: [ ] Yes [ ] No Directional Survey Req'd [ ] Yes [ ] No Required Working Pressure for BOPE: [ ] 2M, [ ] 3M, [ ] 5M, [ ] 10M, [ ] 15M Other: by order of Approved By Commissioner the commission Date Form 10-401 Rev. 12-01-85 <. Submit In Triplicate /A Check No Check Dateh k Amount 0077000083 11 /05/2002 "**"******** 10000 "PLEASE DETACH AT PERFORATION ABOVEA "PLEASE DETACH AT PERFORATION ABOVEA Evergreen Resources (Alaska) Corp Suite 1 =V_I?_ R==hI 1401Dent err COt 80202 200 EVEWEE"rrEsooaeEsw, Check Number 007 0000083 .. Description 110402 JT7 11/04/2002 Permit Fees AOGCC 100.00 0.00 100.00 RECEIVED NOV 12 2 02 Alas oil --& pas cons. ( omagan Anehoreas 009195 ,�z Vendor Check Date: 11/05/2002 Check Amount 41 100.00 r)7�) ME OT A LASKA A I TONY KNOWLES, GOVERNOR A14A►7I> A GAS ANDAND�S 333 W. 7'" AVENUE, SUITE 100 CONSERVATIONCOMUSSION � ANCHORAGE, ALASKA 99501-3539 PHONE (907) 279-1433 FAX (907) 27&7542 John Tanigawa Alaska Projects Manager Evergreen Resources (Alaska) Corporation PO Box 871845 Wasilla AK 99687 Re: Pioneer Unit Bering #3 (Revised) Evergreen Resources (Alaska) Corporation Permit No: 202-177 Surface Location: 1523' FSL & 471' FEL, Sec. 30, T18N, R1W, SM Bottomhole Location: 1523' FSL & 471' FEL, Sec. 30, T18N, R1W, SM Dear Mr. Tanigawa: Enclosed is the revised approved application for permit to drill of above referenced well, to extend total depth of Bering #3 by 900 feet. The permit to drill does not exempt you from obtaining additional permits or approvals required by law from other governmental agencies, and does not authorize conducting drilling operations until all other required permits and approvals have been issued. In addition, the Commission reserves the right to withdraw the permit in the event it was erroneously issued. A weekly status report is required from the time the well is spudded until it is suspended or plugged and abandoned. The report should be a generalized synopsis of the week's activities and is exclusively for the Commission's internal use. All dry ditch sample sets submitted to the Commission must be in no greater than 30' sample intervals from below the permafrost or from where samples are first.caught and 10' sample intervals through target zones. Operations must be conducted in accordance with AS 31.05 and Title 20, Chapter 25 of the Alaska Administrative Code unless the Commission specifically authorizes a variance. Failure to comply with an applicable provision of AS 31.05, Title 20, Chapter 25 of the Alaska Administrative Code, or a Commission order, or the terms and conditions of this permit may result in the revocation or suspension of the permit. Please provide at least twenty- four (24) hours notice for a representative of the Commission to witness any required test. Contact the Commission's North Slope petroleum field inspector at 659-3607 (pager). Sincerely, A Cammy or e) Chair BY ORDER OF THE COMMISSION DATED this day of November, 2002 cc: Department of Fish & Game, Habitat Section w/o encl. Department of Environmental Conservation w/o encl. • • Waivers for the following regulations are hereby granted for Bering #3 (Permit No. 202-177): 1. 20 AAC 25.030 (d) (2), requiring conductor casing to be cemented to surface; 2. 20 AAC 25.033 (b), requiring drilling fluid of sufficient density for overbalance; 3. 20 AAC 25.035, blowout prevention equipment requirements; 4. 20 AAC 25.050 (a) (2), requiring well bore surveys for each 500 feet of well depth; 5. 20 AAC 25.061 (a), requiring seismic surveys of near surface strata; and 6. 20 AAC 25.066, requiring gas detection on drilling rigs. "44-A 1114loz- STATE OF ALASKA ALASKA *AND GAS CONSERVATION COASION PERMIT TO DRILL Q���so 20 AAC 25.005 la. Type of work Drill Redri I 1 b. Type of we ] Service eve opment as Inge Zone ]Multiple Zone [ Re -Entry Dee en X Exploratory [ Stratigraphic Test Develo ment Oil 2. Name of operator 5. Datum Elevation ( or B) 1 U. Fieldand Pool Evergreen Resources (Alaska) Corporation 404 ft DF 3' AGL) Pioneer 3. Address P.O. Box 871845, Wasilla, AK 99687 6. Property Designaii4o�.'6w 4. Location of we I at su ace 7. Unit o7r Property Name 11. Type on (see 20 AAC 25.025) 1523' FSL & 471' FEL, Sec. 30, T18N, R1 W, SM Pioneer Unit At top of productive interval Number RLB0004711 8. WellNumber Same Bering #3 At total depth Amount $200M 9. Approximate spud ate Same 11 /4/2002 12. Distance to nearest property line 13. Distance to nearest wel 4. Number of acres In property 15. Proposedept an ) 471 ft BLM Minerals 5810 ft AK94 CBM 16,780 3,900' MD, TVD 16. To be completed for deviated wells 17. Anticipated pressure {see 20 AAC 25.035 (e) (2)) i Kick Off Depth N/A Maximum Hole Angle vertical Maximum surface 2027 psig , At total depth (ND) 1600 prig 18. Casing Program Setting Depth Size S ecifications Top Bottom Quantity of Cement Hole Casing Weight Grade Coupling Length MD TVD MD TVD include stage data 13 12.25 48 K-55 Welded 125 3 3 125 125 26 sx. If necessary, our add'I cement at surface 11 8.625 24 K-55 STC 300 3 3 300 300 111 sx. Circulate to Surface 7.875 5.5 17 K-55 STC 3900 3 3 3900 3900 671 sx. Circulated to surface 19. To be completed for Redrill, Re-entry, and Deepen Operations. Present well condition summary Total depth: measured feet Plugs (measured) true vertical feet Effective depth: measured feet Junk (measured) true vertical feet Casing Length Size Cemented MD TVD Structural Conductor Surface Intermediate Production Liner RECEIVE[) NOV a 4 2002 Perforation depth: measured 4laska 011 & Gas Cons. Comm'sst" Anchorage true vertical 20. Attachments [X] Filing Fee [X] Property Plat [X] BOP Sketch [X] Diverter Sketch [X] Drilling Program X Drilling Fluid Program Time vs Depth Plot Refraction Analysis Seabed Report 20AAC25.050 Reg. Contact Engineer Name/Number: John Tanigawa (907) 841-0000 Prepared By Name/Number: John Tanigawa (907) 841-0000 21. 1 hereby certify that the foregoing is true and correct to the best of my knowledge Signed Title Alaska Projects Manager Date Commission Use Only Permit Number API Number `Z- - (� J©�O — �� (� — ©Ci A rev I Dat See cover letter + for other reqSjirements Conditions of Approval: Samples Required: Yes I 2 No Mud Log Required V1 Yes [ ] No Hydrogen Sulfide Measures: [ ] Yes bQ No Directional Survey Req'd Yes [ ] No Required Working Pressure for BOP : [ ] 2M, Other: Mi Ors �, w�C �� Yu i S t4p i. ' [ ] 3M, [ ] 5M, [ ] 10M, [ ] 15M c°rt S TPA, . ftinai Signed By by order of Approved By CamMy OeMS11 Tawky Commissioner the commission Date Form 10-401 Rev. 12-01-85 Subroitlrl'Triplicate RESOURCES (ALASKA) CORP. A Subsidiary of Evergreen Resources, Inc. November 4, 2002 Ms. Cammy Oechsli-Taylor, Chair Alaska Oil and Gas Conservation Commission 333 West 7th Ave., Suite 100 Anchorage, Alaska 99501 RE: Revised APD — Increase TD from 2,999 to 3,900 ft KB Bering 3 Twp 18 North Rng 1 West Seward Meridian Pioneer Unit Matanuska Susitna Borough Dear Commissioner Taylor, Evergreen Resources Alaska requests permission to drill an additional 900 feet on the subject well evaluate the Tyonek coals and sandstones. Since the additional depth requested is beyond 500 feet, please find the attached APD and a check for $100.00. On November 1, 2002, Evergreen TD'd the Baranof #4 to a depth of 3,700 ft KB. No drilling problems were encountered. There are absolutely no indications that this well will behave differently. Thank you for your assistance. I appreciate the help you and your staff have given our company. Sincerely, EVERGREEN RESOURCES (ALASKA) CORP • John J. Tanigawa Alaska Projects Manager RECEIVED NOV 0 4 2002 Alaska Oil,& Gas Cons. CDmmisslQr, Anchorage P.O. Box 871845 • Wasilla, AK 99687 • TEL 907.357.8130 • FAX 907.357.8340 FW: Well —Location Evergreen.xls Subject: FW: Well_ Location _Evergreen.xls Date: Fri, 11 Oct 2002 11:40:54 -0800 From: "John Tanigawa" <JohnT@EvergreenGas.com> To:<steve_davies@admin.state. ak.us> Steve, The original file had wellnames that were incorrect. Here is the correct file. Thank you. Have a great weekend. John Tanigawa 907-841-0000 -----Original Message ----- From: Enric Fernandez [mailto:efernandez@lynxalaska.com] Sent: Thursday, October 10, 2002 3:31 PM To: John J. Tanigawa (E-mail) Subject: Well_Location_Evergreen.xls John, This is the updated file with the name swap! Enrique Fernandez Information Technology and GIS Director Lynx Enterprises, Inc. 1029 W. 3rd Ave, Ste. 400 Anchorage, AK 99501 907-277-4611 efernandez@lynxalaska.com The information contained in this communication is confidential and privileged proprietary information intended only for the individual or entity to whom it is addressed. Any unauthorized use, distribution, copying, or disclosure of this communication is prohibited. If you have received this communication in error, please contact the sender immediately <<Well_Location_Evergreen.xls>> FRS Name: Well_Location_Evergreen.xls Well Location Evergreen.xls Type: Microsoft Excel Worksheet (application/vnd.ms-excel) Encoding: base64 I'UU i3UUf+ yO1; UDIOUILIUU J tUU'UVl "PLEASE DETACH AT PERFORATION ABOVE' "PLEASE DETACH AT PERFORATION ABOVE" Evergreen Operating Corp 1401 17th Street, Suite 120 E RGIt__�I Denver CO 80202 evEaceF�Neesamca mc. Check Number 0083004895 • 9. DescriptionB • 042802 JT-03 04/28/2002 12 Month Drilling Permit Fee 100.00 0.00 100.00 R� C�IU ED NOV p 4, 2002 ins. Comm`�ion Cd►Oi1&An hora9e AREA NAME ELV FT LEGALDESC ASP27Z4N ASP27Z4E DD27N DD27E Pilot 1 D.L.SMITH #1 274.4 Located 3293' north of the south line and 293' from the west line of section 1 T17N R3W Seward meridian. 2774923.09356000000 543786.35874200000 61.59466451260 -149.74861231100 Pilot 1 GARY & JOANN STROMBERG #2 296.0 Located 1386' north of the south line and 933' from the west line of section 1 T17N R3W Seward meridian. 2775528.70150000000 544423.26626200000 61.59631427130 -149.74494210500 Pilot 1 CORNHUSKER #4 249.8 Located 3272' north of the south line and 606' from the east line of section 2 T17N R3W Seward meridian. 2774899.30194000000 542887.46491700000 61.59460882660 -149.75377352900 Pilot 1 ROBERT SMITH #3 265.3 Located 2426' north of the south line and 141' from the east line of section 2 T17N R3W Seward meridian. 2774054.90335000000 543355.95720500000 61.59229425450 -149.75110236500 Pilot 2 COOK #1 408.8 Located 991' north of the south line and 888' from the east line of section 30 T18N R1 W Seward meridian. 2783408.27296000000 584593.04550000000 61.61724205120 -149.51397565500 Pilot 2 LOWELL #2 399.9 Located 967' north of the south line and 1329' from the east line of section 30 T18N R1 W Seward meridian. 2783381.99302000000 584152.01484300000 61.61717914890 -149.51651058400 Pilot 2 BERING #3 449.0 Located 1523' north of the south line and 471' from the east line of section 30 T18N R1 W Seward meridian. 2783942.33402000000 585004.69554800000 61.61869441150 -149.51158763300 Pilot 2 BARANOF #4 403.6 Located 504' north of the south line and 423' from the east line of section 30 T18N R1 W Seward meridian. 2782923.44787000000 585062.93452400000 61.61590632030 -149.51129695300 Pilot 3 TYONEK #1 417.4 Located 301' north of the south line and 1841' from the west line of section 20 T18N R1 W Seward meridian. 2788017.16180000000 587274.33011000000 61.62979282080 -149.49836720300 Pilot 3 KENAI #2 418.9 Located 815' north of the south line and 1832' from the west line of section 20 T18N R1 W Seward meridian. 2788531.16269000000 587261.14713400000 61.63119900780 -149.49842021600 Pilot 3 ILIAMNA #3 429.3 Located 236' north of the north line and 2403' from the west line of section 29 T18N R1 W Seward meridian. 2787480.78035000000 587841.89235100000 61.62831369770 -149.49512903800 Pilot 3 NANWALEK #4 414.7 Located 353' north of the north line and 1528' from the west line of section 29 T18N R1 W Seward meridian. 2787361.90624000000 586968.42649400000 61.62800698160 -149.50015429700 Evergreen Well Locations NAD 27, AK Zone 4 Subject: Evergreen Well Locations NAD 27, AK Zone 4 Date: Thu, 10 Oct 2002 11:14:27 -0800 From: "John Tanigawa" <JohnT@EvergreenGas.com> To: <steve davies@admin.state.ak.us> Steve, I apologize that these have taken so long. Here are the coordinates. >From now on, we will submit all coordinates in NAD 27. Please contact me if you have futher questions. Thank you. John Tanigawa 907-841-0000 Name: Well_Location_Evergreen.xls Well Location Evergreen.xls Type: Microsoft Excel Worksheet (applicationlvnd.ms-excel) Encoding: base64 1 r AIR «.4-7>dA0 r Rz . roc t��co �..t� �•rc 4 -em 2r aca Accaa.res; &cowrCW &644 '7?Amr— �it,+,v� Jo.•'� �+� . A�vD Ciw sraT]oa, jJWeow,e'4y aG ✓�JL 41t �'G'�✓ dvRfi.�' �A•�9rs�I'lJ ['��?� ../ *- AULT, .� 4 � . RECEIVED SEP 1 a 2002 icst�&GssCons.Commission TO'd ti00'oN OZ:SZ ZOOOI d3S 6909-9Z2:QI NOIlki(b3X3 'f'Q 0 ALASKA TONY KNOWLES, GOVERNOR ALA KA OIL AND GAS 333 W. 71H AVENUE, SUITE 100 CONSERVATION COMMISSION ANCHORAGE, ALASKA 99501-3539 PHONE (907) 279-1433 FAX (907) 276-7542 John Tanigawa Alaska Projects Manager Evergreen Resources (Alaska) Corporation PO Box 871845 Wasilla AK 99687 Re: Pioneer Unit Bering #3 Evergreen Resources (Alaska) Corporation Permit No: 202-177 Surface Location: 1523' FSL & 471' FEL, Sec. 30, T18N, R1W, SM Bottomhole Location: 1523' FSL & 471' FEL, Sec. 30, T18N, R1W, SM Dear Mr. Tanigawa: Enclosed is the approved application for permit to drill the above referenced exploration well. The permit to drill does not exempt you from obtaining additional permits or approvals required by law from other governmental agencies, and does not authorize conducting drilling operations until all other required permits and approvals have been issued. In addition, the Commission reserves the right to withdraw the permit in the event it was erroneously issued. A weekly status report is required from the time the well is spudded until it is suspended or plugged and abandoned. The report should be a generalized synopsis of the week's activities and is exclusively for the Commission's internal use. All dry ditch sample sets submitted to the Commission must be in no greater than 30' sample intervals from below the permafrost or from where samples are first caught and 10' sample intervals through target zones. The permit is approved subject to full compliance with 20 AAC 25.055. Approval to perforate and produce is contingent upon issuance of a conservation order approving a spacing exception. Evergreen Resources (Alaska) Corporation assumes the liability of any protest to the spacing exception that may occur. Operations must be conducted in accordance with AS 31.05 and Title 20, Chapter 25 of the Alaska Administrative Code unless the Commission specifically authorizes a variance. Failure to comply with an applicable provision of AS 31.05, Title 20, Chapter 25 of the Alaska Administrative Code, or a Commission order, or the terms and conditions of this permit may result in the revocation or suspension of the permit. Please provide at least twenty- four (24) hours notice for a representative of the Commission to witness any required test. Contact the Commission's North Slope petroleum field inspector at 659-3607 (pager). incerel ,V Daniel T. Seamount, Jr.. Commissioner BY ORDER OFJHE COMMISSION DATED this. day of September, 2002 cc: Department of Fish & Game, Habitat Section w/o encl. Department of Environmental Conservation w/o encl. Waivers for the following regulations are hereby granted for Bering #3 (Permit No. 202-177): 1. 20 AAC 25.030 (d) (2), requiring conductor casing to be cemented to surface; 2. 20 AAC 25.033 (b), requiring drilling fluid of sufficient density for overbalance; 3. 20 AAC 25.035, blowout prevention equipment requirements; 4. 20 AAC 25.050 (a) (2), requiring well bore surveys for each 500 feet of well depth; 20 AAC 25.061 (a), requiring seismic surveys of near surface strata; and 6. 20 AAC 25.066, requiring gas detection on drilling rigs. STATE OF ALASKA ALASKA *AND GAS CONSERVATION COM*SION PERMIT TO DRILL 20 AAr 2s nnS �Gh g1 Sl0 L 9/gloL a. Type of work Drill rl ype of well I Service eve opment as Single Zone Multiple zone Re-Entry Dee en —T71ame X Exploratory Strati ra hic Test Development Oil ot Operator 5. Datum Elevation or KU) I U. Field and Pool Evergreen Resources Alaska Corporation DF X AGL Pioneer 3. Address 6, Property Designation Tic.. P.O. Box 871845, Wasilla, AK 99687 Crete—� 0115 4. Location of well at surface 7. Unit or roperty ame ype Bond (see 20 AAC 25.025) 1523' FSL & 471' FEL, Sec. 30, T18N, R1 W, SM P'- At top of productive interval Number RLB0004711 8. wellNumber Same Bering #3 At total depth Amount $200M 9. Approximate spud Ste Same 9/15/2002 12, Distance to nearest property line 13. Distance to nearest well acres in property 5. roposdepth 9nd TVD) 471 ft BLM Minerals 5810 ft AK94 CBM 16,780 2,999' MD, TVD 16. To be completed for deviated wells j 17. Anticipated pressure (see 20 AAC 25.035 (e) (2)) Kick Off Depth N/A Maximum Hole Angle vertical Maximum surface 1559 psis , At total depth (TVD) 1230 psig 18. Casing Program Setting Depth Size Specifications Top Bottom Quantity of Cement Hole Casing Weight Grade Coupling Length MD TVD MD TVD include stage data 13 12.25 48 K-55 Welded 125 3 3 125 125 26 sx. If necessary, pour add'I cement at surface 11 8.625 24 K-55 STC 300 3 3 300 300 111 sx. Circulate to Surface 7,875 5.5 17 K-55 STC 2999 3 3 2999 2999 535 sx. Circulated to surface 19. To be completed for Redrill, Re-entry, and Deepen Operations. Present well condition summary Total depth: measured feet Plugs (measured) true vertical feet Effective depth: measured feet Junk (measured) true vertical feet Casing Length Size Cemented MD TVD Structural Conductor Surface Intermediate Production Liner Perforation depth: measured true vertical 20. Attachments [X] Filing Fee [XI Property Plat [XI BOP Sketch [X] Diverter Sketch [X) Drilling Program X Drilling Fluid Program I I Time vs Depth Plot I I Refraction Analysis Seabed Report I I 20AAC25.050 Reg. Contact Engineer Name/Number., John T nigawa (907) 841-0000 Prepared By Name/Number. John Tanigawe (907) 641-0000 21. 1 hereby certify that the f ing ' and correct to the best of my knowledge Signed Title Alaska Projects Manager Date Commission Use Only Permit Number �d PI Number A proval Date See cover letter C Jam— for other requirements Conditions of Approval: Samples Required: XYes [ I No Mud Log Required XYes [ ] No Hydrogen Sulfide Measures: [ I Yes �No Directional Survey Req'd Yes ! No_ ORIGINAL SIGNED BY Required Working Pressure for BOPS: [ 12M, t) 3M, [ 15M, [ ] 10M, [ ] 15M Other: D Taylor Seamount ORIGINAL SIGNED BY D Taylor Seamount by order of A roved By Commissioner the commission Date Form 10-401 Rev. 12-01-85 Submit Id Triplicate •=V=RGR==ISI RESOURCES(ALASKA)CORP. A ,SR�uMry o1 Ewrymn RexMnw, rc Permit To Drill Additional Information 20 AAC 25.005 (C 1) $100 FEE Check attached to application 20 AAC 25.005(C 2) PLAT IDENTIFYING PROPERTY AND OWNERS The mineral interest ownership map and the survey plat are shown in Figures 1 and 2 respectively. Figure 1 shows the subject well within Pilot Number 2. It also shows the mineral interest owners including a 1,500 foot radius around each well. University of Alaska snding Evergr State of Ala! (Evergreei Figure 1 Mineral Ownership Map and 1,500 foot radius around each well in Pilot 1 Coordinates of the location at surface, top of each formation, at total depth Hole Locations Surface 1523' FSL & 471' FEL OF SEC 30 Twp 18 North Rng 1 West Top T onek 1523' FSL & 471' FEL OF SEC 30 Twp 18 North Rng 1 West Total Depth 1523' FSL & 471' FEL OF SEC 30 Twp 18 North Rng 1 West (a) Coordinates in state plane coordinates Hole Locations Surface North 2783636 ft & East 1724950 ft ASP Zone 4 Nad 83 Top T onek North 2783636 ft & East 1724950 ft ASP Zone 4 Nad 83 Total De th North 2783636 ft & East 1724950 ft ASP Zone 4 Nad 83 APPLICATION FOR PERMIT TO DRILL Bering 3 Pilot 2 =V=I2GR==1d ! • RESOURCES (ALASKAICORP. A hfikknry N Evrrp,eyn R9ta,Icrt,[ Irc. NOTES: 1. COORDINATES SHOWN ARE NAD83 ALASKA STATE PLANE ZONE 4, NAD 83. 2. GEOGRAPHIC COORDINATES ARE NAD 83. 3. ALL DISTANCES ARE GROUND IN U.S. SURVEY FEET. 4. VERTICAL DATUM IS M.S.L. NGVD 1929. BASED ON BENCHMARK "V102" BERING #3 LOCATED 1523' FROM THE SOUTH LINE AND 471' FROM THE EAST LINE OF SECTION 30, T 18 N, R 1 W, SEWARD MERIDIAN LAT. 61'37'04.758"N LONG. 149'30'51.441"W ASP ZONE 4 N=2783635.605 E=1724949.770 (NAD 83) GROUND ELEVATION = 449.0' C 1/4 AI on-rzi 11 r," m nG Zn A A W SPRUCE AVE VICINTY MAP SCALE 1" = 1 MILE N 29 VJ JI IJ LV JJ.TT N O) M N BERING #3 470.89' SE 1 /4 SECTION 30 p T18N, R1 W, S.M., ALASKA U p 00 � U o N J 0 o z v 30 3U Q� c� N SCALE 1" = 600' w 0 It 00 0 0 0 v 29 N 89 51 23 W 2639.43 ji 32 PILOT 2 WELL BERING #3 LOUNSBURY & ASSOCIATES, INC. ENGINEERS —PLANNERS —SURVEYORS 723 W. 6th AVE. ANCHORAGE, ALASKA 99501 PERMIT DRAWING (907) 272-5451 DRAWN FWW I CHECKED KWA SCALE 1' = 600' AUGUST 12, 2002 DWG NAME 028-3W3.DWG APD Bering 3 Pilot 2 VRGH=NI • RESOUROESIALASKAICORP, a SiMxAalN nfwgron� aenrn,rces, rM (b) Proposed Depth, Depth of each objective formation Estimated Formation Tops Quarternary Gravel Surface Tertiary T onek 100 (c) Other Information as required by 20 AAC 050(b) For all hole segments, an air hammer will be used to drill the hole. Unlike PDC or conventional bits, air hammers, inherently drill straight holes. This is because the weight on bit is a fraction of the weight required by conventional drilling techniques. Increased weight on bit causes holes to become deviated. For additional information, please refer to Evergreen's response to the waiver request in Appendix A of this application. Since air hammers have not been widely used in Alaska's oil and gas industry, Evergreen will perform a Totco deviation survey for this well. This information will confirm to the commission that air hammers, by their design, must drill straight holes. It is our aim that after showing the commission that air hammers drill straight holes, that surveys will not be required. 25 AAC 25.005 (c 3) DIAGRAM OF BOPE Evergreen will use air to drill conductor, surface and production holes. Using this system, we plan on using a diverter in lieu of a BOP since our proposed diverter system is an equally effective means of well control in shallow gas wells. This discussion is included as Appendix A submitted August 8, 2002. A diagram of Evergreen's well control arrangement is shown in Figure 3. Two diverters will be used while drilling the subject well. One for the 11 inch surface casing hole and the other for the 7-7/8 inch production casing hole. For the I V surface hole, the diverter will connect to the cemented in conductor via a 13- 3/8" ST&C collar. Evergreen Resources Alaska Surface Well Control Setup 4-1/2"drill pipe Washingto 125 psi gate valve 30' x 8" ID Blooey Line 500 psi VENTING Diverter ----®20 MMSCFD KICK Head 4 k'.;ti '' ♦+' Ground Level 8 5/8 Surface Cas FORMATION GAS This schematic shows Evergreen's Air Drilling well control setup. When venting a 20 million standard cubic foot kick of methane, the diverter must contain 40 psi of pressure. The Diverter is rated to 500 psi while drilling and 1,000 psi while static. This is a 12 fold safety factor while drilling and a 24 fold safety factor when pipe is not rotating. Figure 3 — Surface Well Control The Production hole's diverter will connect to the cemented in 8-5/8" surface casing via the 8-5/8" ST&C collar. These diverters are shown in the Figures 4 and 5. APD Bering 3 Pilot 2 • RESOURCES (ALASKA) CORP. A Gnb— N Ewryres+ Reedrrces, M EVERGREEN RESOURCES ALASKA SURFACE CASING DIVERTER �— 15 h —� WASHINGTON DNERTER RUBBER ELEMENT MODEL 4010-CG.... Isee m9M1 16In io 30 FT BLOOEV LINE 8-W, 23 PPF. J-55 CASING 8097' ID Wnh Homnw Union connector CONNECTOR Is a 13-3/8` PIN ST&C. 8 RD, J-55 Figure 4 Surface Casing Diverter 0 EVERGREEN RESOURCES ALASKA PRODUCTION CASING DIVERTER r — 15 In WASHINGION DNERTER RUBBER ELEMENT MODEL 401 O-CG [see Below) 161n To 30 FT SLOOEY LINE 8_, 1 23 PPF. J-55 CASING 8,097. ID YM HWI"r Union Connector CONNECTOR 8-5/8' PIN ST&C, 8 RD. J-55 Figure 5 Production Casing Diverter 25 AAC 25.005 (c 4 A) MAXIMUM BOTTOMHOLE PRESSURE The maximum anticipated surface pressure (MASP) for this air -drilled well will equal the formation pore pressure less a full gas column to the surface. Based on offset well data, the highest formation pressure expected in this well is 1,559 psi (10.0 ppg EMW) at the well's TD of 2,999' TVD (or 0.520 psi/ft). Complete evacuation of the well bore, except for a 0.11 psi/ft gas gradient, is assumed. MASP (pore pressure) = (2,999 ft)(0.520 — 0.11) = 1,230 psi 25 AAC 25.005 (c 4 B) DATA ON POTENTIAL GAS ZONES One gas bearing zone will be encountered during the drilling of this well, namely the Tertiary Tyonek formation. Here, coals will be drilled through along with sandstones and siltstones. There are six wells that have penetrated this zone within the Pioneer Unit. The Quarternary Gravel will also be penetrated. This zone has no gas since there are no barriers for accumulation. This is the area's fresh water aquifer. 25 AAC 25.005 (c 4 C) POTENTIAL DRILLING PROBLEMS Since air drilling will be the drilling fluid for this well, problems associated with differential sticking and loss circulation zones, as identified in the regulations, are not relevant. However, issues associated with hole sloughing are a concern. For this reason, 12-3/4 inch conductor casing will be casing air drilled through the Quarternary APD Bering 3 Pilot 2 =V=RG-I?==1N RE SOURCES(ALASKA)CO RP, A 9uMnNnry O� RYarpr.er, R¢erurp`a, tom, Gravel section. This interval will then be cemented in with 26 sacks of cement to prevent water and gravel from sloughing through the conductor annulus. Significant gas volumes produced from formations are easily handled during drilling and this is discussed in Appendix A. To ensure that casing and logs can be run safely, if sufficient gas is being vented, then the well will be killed. On site will be a cement pump, mix tanks and sufficient chemicals to create a 10.5 pound killing fluid. ' The risk of encountering 1-12S is negligible. No wells drilled in or near the Pioneer Unit had any indications of hydrogen sulfide. Further, coal bed methane does not contain 1-12S. Details for 1-12S are discussed in Appendix A submitted to the commission on August 8, 2Q02. 25 AAC 25.005 (c 5) FORMATION INTEGRITY TEST Formation integrity tests are not applicable for this application since air drilling with a diverter is being employed. Formation integrity tests require a pressure containment scheme using BOPs to be relevant. Please refer to Appendix A of this application for further discussion. 25 AAC 25.005 (c 6) CASING AND CEMENT PROGRAM The casing and cementing program for the subject well is shown below. For the first well drilled in Pilot Number 2, a single induction log will be run to confirm that the surface casing is set through the fresh water zone. We will drill and set surface casing below the fresh water zone. All remaining surface casing depths will be modified based on this information. Current setting depths are well below all fresh water wells in the area. Casingi Information Depth ft KB CD in ID in Pipe Grade Weight Iblft Connection Type New/Used Conductor 125 12-3/4 12.00 Line Pie 48.0 ST&C Limited Svs Surface 300 8-5/8 8.097 K-55 23.0 ST&C New Production 2990 5-1/2 4.892 K-55 17.0 ST&C New For the surface and the production casings, the cement will be circulated to surface. In the case of the conductor pipe, we will attempt to circulate cement with 26 sacks of cement. If cement does not circulate, which is likely since this is a gravel interval drilled with air, then we will fill the annular volume with cement. Cement Information Depth ft KB Volume sacks Yield ft31sk Type Comments Conductor 125 26 1.18 Class G Circulate, if no circulation, then pour from top Surface 300 111 1.21 Class G Circulate to Surface Production 2990 535 1.35 Class G Circulate to Surface 20 AAC 25.005 (c 4) DIVERTER SYSTEM The diverter system is described in 25 AAC 25.005 (c 3) BOP SETUP. 20 AAC 25.005 (c 8) DRILLING FLUID SYSTEM APD Bering 3 Pilot 2 =V=RGR==I4 RESOURCES (AIASZ) CORP. ASuamary a caa�renn a�,rns. iM. The subject well will be air drilled and therefore utilize no fluid system. The proposed process of air drilling and of killing the well when and if necessary are described in detail in Appendix A dated August 8, 2002. 20 AAC 25.005 (c 9) ABNORMALLY GEOPRESSURED ZONES There are no abnormally geo pressured wells in the Pioneer Unit as discussed in Appendix A, submitted on August 8, 2002. 20 AAC 25.005 (c 10) SEISMIC REFACTION/REFLECTION ANALYSIS Evergreen requested a waiver for running seismic as detailed in Appendix A, submitted on August 8, 2002. 20 AAC 25.005 (c 11) OFFSHORE, SEABED CONDITIONS Not applicable. This is an onshore well. 20 AAC 25.005 (c 12) EVIDENCE OF BONDING Evergreen Resources Alaska's state wide bond is on file or will be very shortly with the commission. 20 AAC 25.005 (c 13) COPY OF DRILLING PROGRAM A copy of the drilling program is shown as Appendix B. 20 AAC 25.005 (c 14) DRILLING MUD & CUTTINGS DISPOSAL Evergreen has received permission from the Matanuska-Susitna Borough to dispose of drill cuttings at the borough landfill. Because well depths are less than 3,000 feet, we also have permission to dispose of the cuttings at the drill site. 20 AAC 25.005 (d) INTENTIONALLY DEVIATED WELLS This well is not being intentionally deviated 20 AAC 25.005 (e) MULTIPLE BRANCH WELLS This well will not have multiple branches 20 AAC 25.005 (f-h) n/a APD Bering 3 Pilot 2 RESOURCES(ALASKA) CORP. A 1v1 ., of F-91— Ras+,— lam. Appendix A Answer to AOGCC Questions APD Bering 3 Pilot 2 RESOURCES(ALASKA) CORP. A.��q�atnryN Everyreer Roea+rces. Inr. EVERGREEN Evergreen Resources Alaska Corporation Response to AOGCC Questions August 8, 2002 John Tanigawa Alaska Projects Manager Wasilla, Alaska 907-841-0000 APD Bering 3 Pilot 2 EVERGREN RESOURCES(ALASKA)CORP. a & .— of e- aeeavwa. * Waiver #1 — 20 AAC 25.030(d)(2)- Don't want to cement 100' to 200' conductor to surface. Will use 10 sacks. Surface csg must be set below the glacial gravel section. The gravel section is 500' to 800' thick, not 100' to 200'. The map (Figure 4) is a structure map using sea level datum. You have to add the topographic elevation to get the true thickness. Coals and permeable sands which may be gas bearing are present immediately underlying the glacial gravel section. (1)What would you do to mitigate risks if you drilled a free gas zone prior to setting surface csg? (2) How will free gas affect your cementing plans? (3) Does the fact that you will be setting the conductor in a permeable gravel zone change your ideas about your cementing plan? First, we must make a correction to figure 4 in the C Plan exemption document. Figure 4 does not represent the top of the Tyonek. The figure is improperly labeled. Instead, this is an isopach map showing the thickness of the gravels based on water well data. You are right, if this were a Tops map for the Tyonek, then the 500 to 800 feet would be correct. (1) To mitigate the risks of encountering a gas zone while drilling the surface casing, Evergreen will a) set and partially cement a 12-3/4" conductor casing (to protect fresh water & prevent water from entering well bore during surface hole drilling), b) Use a diverter (to redirect gas from annulus), c) Utilize a series of check valves in the drill string (to eliminate gas up drill pipe) and d) Drill with air. Described below is a description of this process and how it will mitigate dangers during this portion of the well plan. a) Evergreen will hire a water well contractor to casing drill (e.g., casing is drill pipe) the conductor through the Tertiary gravel and into the top +/-25 feet of the Tyonek formation. Depths are estimated to be 100 feet in Pilots 2 and 3 and 200 feet in Pilot 1. This section of the hole will be reverse circulated using air. After the casing is set, a 13-3/8",ST&C, 8 rd, J-55 collar will be installed at surface via a bell nipple. We will attempt to circulate cement to surface using 20-30 sx of 15.6 ppg cement or 150% of the annular volume. If cement does not circulate, which is likely in an air drilled hole through gravel, then we will pour additional cement sacks from surface until full. Before drilling out, the conductor will be pressure tested to 100 psi or Y2 psi/ft of the conductor setting depth. The conductor, therefore will be sealed. It is noted here that the primary reason for cementing the conductor is to prevent water from entering into the well bore while drilling the surface hole and not for kick protection. This is because, kick protection in the traditional sense, is not needed in an air drilled hole. b) Next, a 13-3/8" x 4-1/2" drill pipe diverter will then be installed. The diverter will screw into the conductor casing. The 11" surface hole will be drilled using an air hammer bit at 3,000 scfm of air. The diverter will redirect air, methane, cuttings, APD Bering 3 Pilot 2 VERG-IZ==NI RESOURCES(ALASKA) CORP, SixttxFxryo' fteryreen Resnx+s, lr. and water from the annulus to the cuttings pit via an 8" diameter by 30 foot blooey line — well away from the drilling table. This diverter head is fabricated by Evergreen, has been used for 7 years, has drilled over 575 wells in a variety of working conditions. Pressure rating is estimated to be 250 psi working and 500 psi static, which is half of a similar Washington or Williams diverter. This pressure rating should be adequate. For example, if 100 MCFD of methane gas were being vented, the diverter would see approximately 20 psi of pressure. c) We must also prevent natural gas from flowing up through the drill pipe during connections. This is handled through a series of check valves inside the 4-1/2" drill pipe. d) Finally, as will be shown later in this report, handling shallow gas kicks is arguably safer using air than in mud drilling. This is because well control is not based on containment of the formation pressures, where high pressure BOP's, and very large (in excess of 16 inches) are required. Instead, the formation is allowed to vent and high pressures are not allowed to build-up. (2) A free gas zone does not affect our cementing plans. Surface cement will have a density of 15 ppg. (3) We plan to sent the conductor casing below the gravel zone and into the top of the Tyonek formation. We plan to drill roughly 25 feet into the Tyonek. We were not planning on setting above the Tyonek. Waiver #2- 20 AAC 25.033 (b) Drill under balanced with air. (1) There are some permeable sands in the section. Some coals may also be permeable and may contain only gas and no water. Your plan is to have fluid and cement on location. Do you understand that the BLT #1 tested individually up to 40BBLS/hour of gassy water from several sands and one coal suggesting artesian or other type of over -pressured systems? We think that the Pittman well also encountered gas sands. You should verify that. (2) Have you evaluated the mud weights in wells drilled in the area? (3) What volume of air will you be using? Would it be sufficient to dilute a zone capable of 2000mcfd to below lower explosive limit (LEL) at hydrostatic pressure? (4) What is the maximum expected equivalent mud weight attainable from the drilling air? (5) What equipment is available to pump kill weight fluid and how will it be pre -staged? What would be the response time if a kick occurred? (1) You are correct for the BLT #1 there was a 40 bbl/hr flow of gas cut water. We were unable to find information at the commission library regarding the Pitman #1 well. �,t- # However, If we encounter 40 bbls/hr of gas -cut water, this will not be a problem. We Al. have effectively air drilled with water rates in excess of 250 bbls/hr of gas -cut water, further, we will have the pump equipment, and additives to kill the well on site. /J,? i (2) We have evaluated the mud weights in the area. This data is shown in the tablet, below. Generally, wells were drilled with muds in the 9.5 to 10.0 ppg range for the -f depths we are drilling. (3) The volume of air we will be 2,000 scfm for the 7-7/8 inch hole and 3,000 scfm for the 11 inch hole. The lower explosive limit (LEL) in ideal conditions is 5% and the APD Bering 3 Pilot 2 V=1 GR==NI • RESOURCES(ALASKA) GORG Upper explosive limit (UEL) is 12% by volume of methane in air [U S Bureau of Mines, R.I. no. 4751, 1950]. At concentrations above the LEL threshold, the air - methane mixture capable of ignition. Formations can therefore flow up to 144 Mcfd of methane in the 7-7/8" production hole and 218 Mcfd in the larger surface hole before fire is possible. Even when one drills wells in this condition, down hole are almost unheard of in CBM reservoirs. This is because even when one is in the explosive window, it is virtually impossible ignite the gas. Ignition sources in these shallow wells are principally thought to be from the bit cutting the rock and drill pipe rotating against a formation or surface/conductor casing. While operating an air hammer however, water is injected into the compressed air at 20 gpm to cool the bit and the hammer mechanism. This water mixture creates a fine mist that prevents sparks from occurring. Further, formation waters are produced during the drilling that further wets the system. Proof however is evident in the fact that thousands of wells have been drilled into CBM reservoirs using air without any down hole fires. (4) The maximum bottom hole pressure just above the bit in the annulus is 30 to 70 psi while air drilling the production hole at 3,000 feet. Mud weights are very low. (5) Equipment that will be on hand to kill the well will be Evergreen's cement unit, batch mixer consisting of two 75 bbl mix tanks water and weighting agents to build two batches of 10.5 ppg mud (or a single 13.5 ppg mud). Evergreen's g portable -- cementer is shown in the figure below. This pump has 4.5" plungers and is — capable of pumping at 6,228 psi at 13.3 -- bpm. The two 75 bbl batch mix tanks are designed to be used as a cement mixer or as a mud tank and are equipped with Evergreen Cement Portable Pump paddles to mix the weighting agents into the water. Calcium chloride will be our weighting mechanism, xanthan guar will be used to build viscosity and lost circulation material (bark, celoflake, et cetera) will be used to assist in lowering the fluid loss. Concentrations of each are the following: 123 Ibs/bbl CaCI, 1.5 Ibs/bbl Xanthan guar and 10 Ibs/bbl lost circulation material. A Evergreen Portable Batch Mixer 28 foot trailer will house the chemicals and will be on location at all times. Waiver #3- 20 AAC 25.035- No BOPE. (1) Have you examined the Houston # 1 and #2 well histories and operations? These wells were drilled with air up to 500' into the coal sections without even a diverter. Ignore Houston #4 since it spuded in metamorphic basement. (2) Can you demonstrate that you have a means of well control that is equally effective to a BOPS? I will do this. APD Bering 3 Pilot 2 =V=I2C-It==h1 0 • PESOUACES (MASK) CORP. .t R-1 -es. 1rt, (3) Your report states that you will have a 1000psi diverter. Is that the pressure rating of the pipe or actual drilling air pressure? Does that imply that you will be using different equipment than what the Commission observed in the Raton Basin? We need a more clear description of your well control equipment. I will do this. I will need some help with CAD work (1) The GRI, Inc's Houston 1,2 3 & 4 well records are unavailable to Evergreen. We have talked to people and have read reports on this project. These wells are relevant due to their close proximity to the Pioneer Unit. Four CBM wells were drilled representing the first time that air drilling technology was employed in Alaska. BOP's were installed after the surface casing, drilled 700 feet into the Tyonek formation, was set (Evergreen as a comparison will drill +/- 25 feet into the Tyonek. Wells were then drilled to roughly 2,100 feet and 4-1/2" casing was run. Coal, sandstones and siltstones were encountered from surface to TD. Although shallow gas was venting during the entire drilling process (even w/o a diverter during surface hole drilling), because the well was allowed to vent and not build up pressure, no well control issues arose and the BOP was never engaged for well control purposes. The successful drilling of these four wells proves that air drilling is an effective way to drill the shallow Tyonek formation in this area. (2) Not only will Evergreen demonstrate that we have an equally effective means of well control but, in fact, air drilling at these shallow depths is safer than mud drilling for shallow gas kicks. Mud drilling relies on always being in an overbalanced drilling condition. As history shows, this does not always happen. When kicks occur, the key to safety is detecting before the well becomes uncontrolled. Detecting shallow gas kicks are difficult since they are relatively hard to detect and because they occur very quickly. The well control strategy in mud drilling is pressure containment. For this reason, elaborate BOP's, choke manifolds, gas busters and very large blooey lines, like those stipulated in the AOGCC regulations are required. Air drilling on the other hand, has a completely different approach to well control. In air drilling our strategy is to allow the well to continually kick. The beauty in this strategy is that pressures are not allowed to build-up thereby eliminating the need for a BOP. Gas is redirected away from the drilling table to the cuttings pit via a blooey line and a diverter head. A Diverter head has a rubber element that seals the annular area between the casing and the drill pipe. To prevent gas from migrating up the drill string, a series of check valves (floats) will be incorporated. If a shallow gas zone is encountered, then the formation is allowed to vent while drilling ahead until bad hole conditions or excessive amounts of water are produced. APD Bering 3 Pilot 2 L YGI yl GGI I I NuavuI VGJ r11aa'a 4-1/2"drio Surface Well Control Setup • R ESOURCES IALASNAI CORP. A Sitliavxnn n' Fwnl'+"' gmnme, i. The amount of Washington 125 psi gate valve 30' x 8" ID Blooey Line gas that can 500 psi VENTING be safely vented Diverter 20 MMSCFD KICK Head in air drilling is Ground Level considerable. 8-50 . To illustrate, Surface Casing using Evergreen's This schematic shnum - 1101- and cubic proposed set foot kick of mett le drilling and 1,000 psi whi is a 12 fold safety factor while drilling and a 24fold safety factor when u p consisting Of pipe is not rotating. a Washington --- stripping head sealing 4-1/2" drill pipe on 8-5/8" casing, 30 foot by 8" ID blooey line, venting 20 million cubic feet of gas per day will generate 40 psia (25 psi gauge) of pressure below the diverter. [Reference: Equation 8-3, Air and Gas Drilling Manual, Lyons et al, McGraw Hill Press, 2001]. This is a lot of gas — roughly 7 times that of our air injection rate. Since the Washington Head is rated to 500 psi dynamic (e.g., while the pipe is rotating) and 1,000 psi static, a 12 fold safety factor still exists when venting while drilling and a 24 fold safety factor while pipe is not rotating. Finally, if too much gas is being vented, especially during the running of casing and open hole logs, then Evergreen will kill the well by pumping gelled water down the hole. If necessary, a weighted mud system, as described in the previous mitigation measure, will be implemented. Here a cement pump, batch mixer and materials to make a 10.5+ ppg mud will be on location at all times. So far this year, Evergreen has drilled over 42 miles of hole using an under balanced fluid, diverter head and blooey line like the ones proposed here. There have been no well control incidents this year or in any year previous. Simply put, if the well vents too much gas, we get a water truck and pump water to kill the well. In this case, no cement pump is on stand-by on location. (3) Evergreen will utilize two different diverter heads — one for the 11 inch surface hole and one for the 7-7/8 inch production hole. The surface hole diverter is of Evergreen manufacture. The body consists of a 16 inch 75 ppf piece of casing 20 inches high. The bottom has a 13-3/8" pin connector that screws directly into the conductor. There is a 8-5/8" OD opening (8.097" ID) that mates directly with the 8-5/8" blooey line. On the top is a 9 hole threaded flange where the Washington head is APD Bering 3 Pilot 2 Rubber Element • STOCK SIZES 4C10-A 2' . p•' 4010-B 3 4010-C 41,2 =N=12C-12==14 • • neaounces(ALASKa screwed in. This is the diverter seen in by the AOGCC in Colorado. Photos of the head and the rubber element are show to the right. Because of its similar design and materials, compared to the Washington heads, Evergreen has not pressure rated this head. However, from experience, we estimate that it can handle up to 250 psi dynamic and 500 psi static of pressure or 50% of the manufacturer's rating for the rubber element. As the calculation in the previous section answered, 250 psi provides several orders of magnitude of safety factors when drilling surface holes. This same head has been used over 1,000 hole sections in Colorado. The production hole will utilize a 1358 Washington Stripping head. This head has an 8-5/8", ST&C, 8 round pin on bottom that directly screws into the 8- 5/8" surface casing. There is an 8-5/8" OD opening that connects directly with the 30 foot blooey line. For both the production hole and the surface hole, the same rubber stripping element is used. Pressure ratings for this head are 500 psi dynamic (i.e., while drilling) and 1,000 psi static (i.e., while the pipe is not moving). A picture of the Washington head is shown to the right. The only difference between this head and the one we plan to use is that the bottom here is flanged whereas Evergreen's has an 8-5/8" pin. M Production Hole Diverter Waiver #4- 20 AAC 25.050 No directional surveying. (1) Well is meant to be vertical. The drilling assembly cannot deviate because of its mechanics. However approval of this waiver will probably be dependent on proximity to property lines. Do you have the ability to run a well bore survey log? (2) Can you expand on the reasons deviation of the wellbore will not be significant? (1) Evergreen's drilling rig is not equipped to run (Totco) surveys. well documented fact that air drilling using a hammer must, because of the physics of the system, drill vertical holes. Evergreen will however run Totco surveys via cased hole wireline in the first two wells to prove to the commission that this drilling method produces vertical holes. (2) Evergreen utilizes an Ingersoll Rand Quantum Leap down hole hammer located immediately above the bit. This mechanism is basically a jack hammer located down hole. Air passing through the hammer actuates a piston that that cycles roughly 700 times per minute. Effective stroke on the hammer is roughly 1/5tns of an inch. Pressure required to actuate the hammer action is 200 to 450 psi. In terms of energy transfer to the formation for drilling, the air Hammer is an extremely efficient way to drill. Penetration rates exceeding 200 feet per hour are typical. Shown to the right is a schematic of a down This is because the u APD Bering 3 Pilot 2 RESOURCES (AIASKA) CORP. A &Pl llq C E'. gW1 r+: hole hammer and bit. The primary reason that air hammer drilling produces straight holes is because of the low weight on bit required to drill efficiently. Ingersoll Rand recommends that for an 7-7/8" hole, the weight on bit be 3,900 Ibs or 500 psi per inch diameter of hole. More weight would inhibit the hammer's action causing the bit to simply drag across the formation instead of hammering into it. As a comparison, traditional bits require 3,000 to 6,000 pounds of weight per inch diameter of hole drilled. This means that for an 7-7/8" hole, one would need 24,000 Ibs to 48,000 Ibs on the bit to drill. The weight on bit has a profound effect on how vertical a hole is — less weight means straighter holes. Lubinkski and Woods in the 1950's provided the industry with the basic understanding of drilling vertical and inclined holes. Here they defined several forces on the bottom hole assemblies and drill pipes that cause the hole to deviate from vertical. In his paper entitled "Influences of Tension and Compression on Straightness and buckling", API, 1959, Volume 31, Lubinski presents equations, still used today, that conclude that the lower the weight on the bit, the more vertical the hole. Because air drilling requires very little weight on bit, buckling in the BHA and the drill string and torsional affects due to dragging the bit and the drill pipe — all of which create deviations from vertical — are eliminated. Waiver #5- 20 AAC 25.061 No seismic evaluation for shallow gas hazard. Can be justified by answers to questions under Waiver #2. Evergreen hopes that answers found in Waiver 2 and 3 provide sufficient information and surety to grant this waiver. We will further suggest that in shallow gas development, where unconventional reservoirs are the targets, that seismic is not an appropriate exploration technique. This is because unconventional formations — like coal, shales and tight sands — are ubiquitous and cover large areas. The axiom in this exploration realm is: Targets are easy to find but difficult to produce. Thus the preferred method to explore is through the drill bit and the completion rig. Completion and production techniques define the success and failure of these plays, not drilling. Seismic is not valid since we have a high degree of confidence that the formations are there. Oil and gas targets, are the conjugate — difficult to find but easy to produce. Because targets are more difficult to find, seismic is usually run. To have velocity surveys specified in AAC 25.061 make sense in this exploration regime. However, this regulation does not pertain to shallow gas development. Evergreen looks forward to working with the commission on the application of this regulation to shallow gas in particular. Waiver #6- 20AAC 25.066 Not have three methane and H2S detectors present. Meaningless because of rig configuration. No enclosed spaces. (1) Are there any areas where gas could accumulate? APD Bering 3 Pilot 2 RESOURCES (AIASKA) CORP. A S nary 0 Evegx.• s. i— (2) Do you know of any circumstances in Tyonek section in Cook Inlet Basin where H2S naturally occurs? (1) There are no areas where gas can accumulate. Gas produced will be methane with a molecular weight of 16 versus (air is 29). This means that methane is lighter and will disperse in an upwardly direction. (2) There are no known instances where H2S naturally occurs in the Cook Inlet and particularly in the wells drilled in the Pioneer Unit. Furthermore, even if H2S was present in the coalification process (there is no evidence of this), it is impossible for the hydrogen sulfide to replace the methane adsorbed on the coal. Waiver #7- 20AAC 25.527- No API standards All relevant waivers already covered. Spacing Exceptions- 20AAC 25.055 Wells may be within 1500' of property lines. Wells are 1100' apart. Cannot waive any regulation that affects other person's rights. Figures 18, 20, & 21 indicate the need for spacing exceptions because the wells appear to be within 1500' of a property line. Are any of the wells within 1500' of a property/lease line? Are the colored areas on Figures 18, 20, & 21 the only Evergreen leases? I.e.: Are the white areas on Figures 18, 20, & 21 leased by Evergreen? Do you have a real landmap? Who are the lessors? Maps shown in the Plan of Operations are surface landowner maps. Shown below are land maps showing mineral ownership for Pilots 1, 2 and 3. Also shown on these maps are the proposed well sites which have already been surveyed. Also included in these maps are 1,500 foot radius circles around each well showing which mineral interest owners are within this area. It should be mentioned here, that the well names presented in the Plan of Operations and in this document will be changed when drilling permits are submitted. Pilot 1 is situated on the Smith (Fee Lease). Here the Smiths own the surface and the minerals. As the figure illustrates all wells are all within 1,500 feet of the mineral property line. Here, the State of Alaska owns the minerals and Evergreen has those minerals leased. Pilots 2 and 3 are located on State of Alaska Minerals. These minerals are all leased by Evergreen. Like Pilot 1, all wells are within 1,500 feet of the mineral property line. Adjacent to this acreage are federal acreage blocks that are prohibited from leasing. Evergreen has met with the Bureau of Land Management and described our plans to drill. Since this is an exploration project where no gas will be sold (only vented), they are not opposed to our program. If economic quantities of gas are required, then a Compensatory Royalty agreement will be signed between Evergreen and the BLM. Close to but not within the 1,500 foot radius, are the Mental Health Trust Lands to the East of Pilot 3 and the University of Alaska Lands to the west. Evergreen Alaska leases APD Bering 3 Pilot 2 _V_izcR.:=Isl 0 0 RE SOU RC ES(ALRSKA rORP the Mental Health Trust Lands and is in the process of finalizing the University lands to the west. All wells are 940 to 1,100 feet apart and are designed in a way to test the Tyonek Coal Seams. In a production mode, wells will be spaced much farther apart. The table on the next page summarizes the well placement information. This data is from the surveys done. 5 'S;;;frt11 Of, State of Alaska n (Evergreen) Federal (unteaseable 'etI Well F deral sooaz�< •�.., �.,. (unte seable P�IA. well3 Pilot tw-11 4 io112 I State of Alaska ml I (Evergreen State of Alaska (Evergreen) (Evergreen) I •soonr Mental Health Trust (Evergreen) Zak (Evergreen) Pilot 1 Land Map Evergreen Well Placement for Pilots 1, 2 and 3 Permit Name Well Name S — T — R Footage (from section Pilot 1 Well 1 DL Smith Sec 2 T17N R3W 1255 FNL & 933 FWL Pilot 1 Well 2 Gary & Jo Ann Stromberg Sec 2 T17N R3W 2426 FSL & 141 FEL Pilot 1 Well 3 Robert Smith Sec 2 T17N R3W 3272 FSL & 606 FEL Pilot 1 Well 4 Cornhusker Sec 2 T17N R3W 652 FNL & 293 FEL Pilot 2 Well 1 Cook Sec 30 T18N R1 W 967 FSL & 1329 FEL Pilot 2 Well 2 Lowell Sec 30 T18N R1 W 504 FSL & 422 FEL Pilot 2 Well 3 Bering Sec 30 T18N R1 W 1523 FSL & 471 FEL Pilot 2 Well 4 Baronoff Sec 30 T18N R1 W 991 FSL & 888 FEL Pilot 3 Well 1 T onek Sec 20 T18N R1 W 815 FSL & 1832 FWL Pilot 3 Well 2 Kenai Sec 29 T18N R1 W 236 FNL & 2403 FWL Pilot 3 Well 3 Iliamna Sec 29 T18N R1 W 212 FNL& 1205 FWL Pilot 3 Well 4 Nanwalek Sec 20 T18N R1 W 301 FSL & 1841 FWL APD Bering 3 Pilot 2 Federal -a. Scala of Alaaaa Ern+ar'- (Evergreen) Federal '�^•M mn,... adaral (Unbeweblel Urar<r>rty IUn aseableH wa�kn (Parwl, I of 3 Wet `(Evergrwn) • Ilot 3 • Wall 4 1 113 P' 3 kbntal Health Trim (Everpeen) State of Alaska (Evergrwnl UnWaraiy of Alaska Uni—ky .>en.r. r j IPertdlrq E—g—) of Alaska '.'faal IPending E—Wean) it ill —al I State of Al— O IEvergreenl I federal nbaeeehle) State oflAlaaka (Evergreen) State of Alaska Pilo, (Evergeen) (J f P of 2 all 10 *Pilot 2 1 0 Pilot 2 Wall n.a. Fadaral (Unbawahlel 7(I ,r aAte_ State of Alaska y�ne I (Evergreen) Federal i IUnbawehlat I Pilots 2 (South) and 3 (North) Land Map APD Bering 3 Pilot 2 =V=l?Gl?==NI • RESOURCES(ALASNA) CORP. a $Ij—, I F11-11 Rwdxcxs, ice. Appendix B Proposed Drilling Procedure APD Bering 3 Pilot 2 EVERC—I2==N1 RESOURCES(ALASKA) CORP. � sue..„wya 6.agreen easw�rwev. Irv;. Well Location Elevation Field Target Proposed TD Proposed Drilling Procedure Evergreen Alaska Corporation Bering 3 (Pilot 2) NE/SE of Sec 30 Twp 18 North Rng 1 West Seward Meridian 1523' FSL & 471' FEL OF SEC Matanuska-Susitna Borough, Alaska USA Kelly: 452 Ground: 449 ft (3 ft AGL) Pioneer Unit Tertiary Tyonek 2990 -" Objective Air drill, log and set casing for the subject coal bed methane exploration well. Casing Program Hole Size in Casing Size in) Casing Weight (Ibsift) Casing Grade Casing Connection Casing Depth ft Cement Interval Conductor 13.875 12.75 49 H2O Pipe Welded 125 to surface Surface 1 11.00 8.625 1 24.0 1 J-55 ST&C 8 Round 300 to surface Production 7.875 5.50 1 17.0 1 J-55 ST&C 8 Round 2990 to surface Open Hole Logging Pro ram Log Interval Spontaneous Potential TD to ± 20 ft in Surface Casing Single Induction TD to ± 20 ft in Surface Casing Gamma Ray TD to ± 20 ft in Surface Casing Caliper TD to ± 20 ft in Surface Casing Compensated Density TD to ± 20 ft in Surface Casing The first well drilled in each pilot will have an induction log run on the surface hole to confirm that we have drilled beyond the fresh water zone. A Totco survey will be run in the cased hole to confirm that hammer air drilled holes must be vertical. Mud logging Program Mud log the subject well from surface to TD. Samples every 10 feet. Formation Tops Formation Estimated Tops (ft KB) Quartermy Gravel Surface Tertiary T onek 100 General Information All information not publicly available is considered Tight Hole and confidential. " Spill Prevention Plan and Bear Mitigation measures must be adhered to at all times. APD Bering 3 Pilot 2 =V=I?G-I?==N 0 0 RESOURCES (ALASKA) CORK. A $YM..xbrtryul EYerpmw� Rau�un'an, ��. Proposed Drilling Procedure Bering 3 (Pilot 2) Section 30 Twp 18 North Rng 1 West Seward Meridian Matanuska-Susitna Borough, Alaska CONDUCTOR PIPE 1. MIRU Water Well Contractor. 2. Casing drill using air and air hammer bit to +/- 225 feet or at least 25 feet into the ' Tyonek formation. Casing is 12-3/4 inch OD and 12 inch ID casing. Evergreen personnel will be on location to determine when depth is sufficient. Set casing 8 inches below ground level. Water contractor responsible for sourcing casing. Note: Casing must be straight (not bent) Casing must be vertical 3. POOH with casing drill & LD. 4. Install bell nipple consisting of a 13-3/8" (8 Round, Short Thread and Coupling — standard connection in oil industry) collar on 12.75 OD pipe. Weld nipple on both the inside and outside of casing. Water contractor will be responsible for sourcing bell nipple and welder. 5. Install cementing head (13-3/8"x2" swedge with two 2" valves, 2" nipple and 2"-- plug. Assembly from bottom up are: Swedge, valve, nipple and valve. 6. Cement (grout) program is as follows: a. Pump 110% of casing volume b. Pump annulus volume of cement plus 50% excess c. Displace with one casing volume less 2 barrels (100 gal) of water. This will leave 14.2 feet of cement in casing. d. Close both valves at surface, disconnect grouting unit. Ensure surface assembly hold pressure. If leaving well before 7 ' If cement does not circulate, then place 10 bbls of cement down annulus from the surface or until the surface annular volume is full of cement. Cement I Weight Yield Water Additives Type I Portland 115.6 ppg 1.18 ft /sk 5.2 gal/sk 1 % CaCI 7. Place plug on top valve to secure ifvalve becomes accidentally opened. 8. Wait on Cement at least 8 hours. 9. Open valves at surface. If cement has not set (water will rush out of 2" valve), then close valve and contact Evergreen immediately. 10. Connect Cement (grouting) head to water pump. Pressure test casing to 200 psi for 10 minutes. If pressure holds 200 psi for 10 minutes, then proceed to the next step. If not then Evergreen Personnel will advise on next step. 11. RI with 11" bit (tricone or otherwise) on drill rods. Drill out cement in conductor casing and drill ahead an additional 5 feet. Note any gravel that circulates to surface. 12. Circulate hole with air for 15 minutes. Note any evidence that the gravel is sloughing in during drilling or circulating. If sloughing occurs, then notify Evergreen immediately. 13. POOH and LD rods and bit. 14. RDMO Water Well Contractor proceed to next hole. APD Bering 3 Pilot 2 V=I?GIt==N1 • • RESOURCES (ALASKA) CORP. A 9i�svlary o' Fv.ryrexn Aesairt�s, !rt<. Proposed Drilling Procedure Bering 3 (Pilot 2) Section 30 Twp 18 North Rng 1 West Seward Meridian Matanuska-Susitna Borough, Alaska SURFACE AND PRODUCTION HOLE 1. MIRU Evergreen Rig Number 1. Rig Lay out is shown in Figure 1. Crane will be on location to unload Evergreen Portable cementer and Portable batch mixer. A 28 foot trailer with mud additives to kill well will be adjacent to the cement unit. Have kill IiKes from cement pump to rig's stand pipe ready for kill operation. 2. NU Diverter head (13-3/8" pin on bottom x 4-1/2" DP) and 30 feet 8-5/8", 24 ppf i blooey line with 125 psi gate valve. 3. RIH with 11" bit on hammer, stablizer on 4-1/2", 17 ppf drill pipe. Air hammer drill surface hole to 350 feet. 4. Condition Hole. 5. POOH & LD drill pipe, stablizer, hammer and bit on trailer. Move pipe trailer 30 feet forward. 6. RIH with 8-5/8", 24 ppf, J-55, ST&C, 8 round, Range II casing (no casing greater than 31.5 feet), with centralizers on 1 st, 3rd and 5th joint. Run open-ended. Set casing at ground level. 7. Install cement head. 8. RU Cementers. Circulate cement to surface. 9. Shut -valve at surface. Wait on cement 6 hours. 10. Open valve on cementing head. Ensure that the cement has set. RIH with 7- 7/8" drill bit, hammer, stabilizer on 4-1/2" drill pipe. Tag cement. Ensure that there is 10 feet of cement inside casing. If not, then do not drill out, and contact Evergreen for further instructions. 11. Install Washington Diverter Head (8-5/8", 8 rd pin, ST&C) and 30 ft blooey line (used to drill out surface casing). 12. Drill mead to 2,990 ft KB. Well will be TD'd above this level if significant hole problems occur. r 13. Condition hole with air. Monitor gas flow from well for 5 minutes. If gas is venting from hole at rates too high to safely run casing, then kill well with water. If water is not sufficient, then, weight up with 10 ppg fluid consisting of xanthan gel (125 CaCI sx/100 bbl, 2 sx xanthan gel/100 bbl). 14. POOH & LD bit, hammer, stabilizer, drill pipe. 15. MIRU Patterson Wireline. Run open hole log suite consisting of gamma, compensated neutron, caliper, induction & spontaneous potential. Confirm setting depth of casing. 16.Install Casing Running Diverter on 30 foot blooey line. 17. RIH with 5-1/2" guide shoe, shoe joint, insert and remaining 5-1/2" 17 ppf, ST&C, J-55, 8 round, Range II casing (31.5 max length), with 5 bow centralizers on 1st, 3rd, 10th, 15th and 20th joint. Install 500 psi casing head & run 5-1/2" casing with with 6" of stick-up. 18. Cement production casing from bottom to surface. 19. Clean-up well site. 20. RDMO Cement Unit and proceed to next well 21. RDMO Evergreen Rig #1 and proceed to next well. APD Bering 3 Pilot 2 V=1tGR==1N RESOURCES (ALASJ) CORP. � srtnxre.n w �em�enn ae��xes, t Conductor 12-3/4 inch Welded conn. Surface Casing 8-5/8 inch 24 ppf, J-55 ST&C, 8 Rd Range II Production Cash 5-1/2 in 17 ppf, J ST&C,8f RangE PROPOSED Drilling Procedure Bering 3 (Pilot 2) Section 30 Twp 18 North Rng 1 West Seward Meridian Matanuska-Susitna Borough, Alaska Set at 125 feet KB Cemented with sx Set at +/-425 feet Cement circulated to surface with xxx sx cement Set at 2,990 ft KB �ement circulated to surface with xxx sx cement APD Bering 3 Pilot 2 =V=RGlz==NI • • RESOURCES(AIASKA) CORP. A GRrtMwry a' Fve�ttwn iiPfCllIUYb, fin'. PROPOSED Telephone Contact List Bering 3 (Pilot 2) Section 30 Twp 18 North Rng 1 West Seward Meridian Matanuska-Susitna Borough, Alaska Company Name Location Telephone Columbine Mudlogging Spencer Flournoy Henderson, CO Office: 303-289-7764 Fax: 303-289-7764 Trinidad Trails Inn Motel Front Desk: 719-846-4425 Patterson Wireline Pat Patterson Weston, Colorado Office: 719-868-2119/3311 Evergreen Resources Alaska John Tanigawa Wasilla, AK Office:907-357-8130 P.O. Box 871845 AK Proj Manager Fax: 907-357-8340 Wasilla, AK 99687 Cell: 907-841 -0000 Evergreen Resources Inc. Tom Hemler Denver, Colorado Office: 303-298-8100 Suite 1200 Drilling Manager Fax: 303-298-7800 1401 Seventeenth Street Cell:719-680-1378 Denver, Colorado 80202 P.O. Box 660 Jerry Jacobs Denver, Colorado 80201-0660 Enviro Manager Pense Brothers Drilling Larry Pense Glenpool, OK Office:918-322-3095 Mobil 918-625-1668 Fax: 918-322-3829 APD Bering 3 Pilot 2 EVERGREEN RESOURCES ALASKA CORP P DRILLING SITE LAY OUT - — — — Wellhead Location IF _ C Cement x x Light U - ccj Additives Plant E U N J co co U W O 80 ff 120 ft [5WBb l Frac Tank O C Mud 7SutyItems Tr Description O Mud Supply Trailer - 28 ft enclosed F — Batch Mixer - Two 75 bbl tanks c/� Two Compressors 500 BBL Frac Tank - Fresh Water Cementer - on 20'x8'x8.5' skid z N c � Cement Additives - 20'x8'x8.5' cortex Light Plants - Two to Three on site � U Y EAirooster & Fuel Trailer Compressor - Two Ingersoll Rand XHP 900 scfm/350 psi Booster- Hurricane 3,000 scfm at 1,000 psig LO CL J Light Fuel Tank -1,500 gallon diesel tank w/auto shut-off U c Blooey Line - - 30 ft in Plant ❑ Doghouse Toolshed - 40 ft container w/gen-set Pipe Trailer - has 3,300 ft of 30 ft rods W (8 Doghouse & Parts Trailer `y` 20' Trailer- holds spider, casing running equipment, BHAs C Q � d U WELL Care Desorbtion Trailer -18-24 It trailer on site when coring Mudlogging Trailer -18 ft trailer w/ gas chromat & computer x 4-- Pipe Trailer Drill Rig -1999 Ingersoll Rand RD•20 Truck Mounted Drill Rig Blooey Line - 30 ft length & 8-5/8", 24 ppf casing CD Cuttings Pit -100ft by 30 It by 6 ft deep lined Lu Berm - use material from cuttings pit to stop blocey line pits m 20' Trailer lathed Parking Area - At rear of Location Kill Lines - from cementer to drill rig, always rigged up _ l� �� Tollet - Portable Toilet on Trailer Trash - Commercial or Fabricated Bin �� Sample Photo Light Plant QP Mudk�gger Core Desorb ElTrailer Trailer Toilet Trash 200 ft • • V=ItC-I2=.IN RESOURCES (ALASKA) CORP. 4 S,.-, a1 Ewrgaen Aexvrtes. Irc Well Control Diagrams Bering 3 EVERGREEN RESOURCES ALASKA SURFACE CASING DIVERTER 15 in WASHINGTON DIVERTER RUBBER ELEMENT MODEL 4010-C (See Below) 16 in To 30 FT BLOOEY LINE 8-5/8", 23 PPF• J-55 CASING 8.097" ID with Hammer Union connectc CONNECTOR is a 13-3/8" PIN ST&C, 8 RD, J-55 APD Bering 3 Pilot 2 16 in WASHINGTON DIVERTER RUBBER ELEMENT MODEL 4010-C (See Below) Pressure Rating: 1,000 psi Static, 500 psi To 30 FT BLOOEY LINE 8-5/8", 23 PPF, J-55 CASING 8.097" ID with Hammer Union connector EVERGREEN RESOURCES ALASKA PRODUCTION CASING DIVERTER 15 in CONNECTOR 8-5/8" PIN ST&C, 8 RD, J-55 STOCK SLMS G-9 312 ICL 4 1 2 M -1 tl2"� RESOURCES(AIASKA) CORP. n s+.es;mar, a Ensnee- wsarce,<.�.c Tubular and Cement Information Bering 3 (Pilot 2) Section 30 Twp 18 North Rng 1 West Seward Meridian Matanuska-Susitna Borough, Alaska Drill Pipe 11" Hole 11" Hole 8" Hole 8" Holle Size Pipe Weight ID Drift Collapse Burst Tinsile Capacity Capacity Capacity Capacity Annulus Annulus Annulus Annulus (in) Grade pp (in) (in) (psi) psi K si (bbl/ft) (ft/bbl) (gal/ft) (ftlgal) (bbl/ft) (ft/bbl bbl/ft ftlbbl 4-1/2 D 16.6 3.826 2.812 7,620 7,210 242 0.01422 70.32 0.5972 1.6744 0.0979 10.2175 0.0425 23.5295 Surface Casing 11" Hole 11" Hole 11" Hole 11" Holle Size Pipe Weight ID Drift Collapse Burst Tinsile Capacity Capacity Capacity Capacity Annulus Annulus Annulus Annulus in Grade pp in (in) psi (psi) (Kpsi) (bbl/ft) (ft/bbl) (gal/ft) (ft/gal) (bbl/ft) (ft/bbl (al/ft) (ft/ al 8-5/8 K-55 24.0 8.097 7.9272 1370 2950 263 0.0636 15.70 2.6749 0.3738 0.0453 22.0860 1.9017 0.5259 Production Casing 8" Hole 8-5/8 Surf 8-5/8 Surf Size Pipe Weight ID Drift Collapse Burst Tinsile Capacity Capacity Capacity Capacity Annulus Annulus Annulus in Grade pp in (in) (psi) psi Kpsi (bbl/ft) (ft/bbl) (gal/ft) (ft/gal) ft/bbl bbl/ft bbi/ft5.1/2 J-55 15.5 4.950 4.825 4040 4810 202 0.0238 42.01 0.9997 1.0003 FAnnulus 30.5012 0.0343 27.94 51/2 J-55 17.0 4.892 4.767 4910 5320 229 0.0232 43.01 0.9764 1.0242 30.5012 0.0343 1 27.94 Cement Information Name Density (lb/gal) Yield (ft31sk) Yield (bbl/sk) Water (gal/sk) Additives I V Hole Capacity 8" Hole Capacity Surface Set 15.6 .21 0.2155 5.3 Versaset YK 5% Salt, % Ib/sk Flocele 0.1175 bbl/ft O bbl/ft , a Pioneer LS 12.2 -4:94zl 0.3455 9.4 2% gel, 2% CaCI, 1 % Thixset A %% Thixset B, Yz #/sk Flocele 8.5076 ft/bbl 16.0846 ft/bbl J� APD Bering 3 Pilot 2 VN9 M TO&NOWLES, GOVERNOR 7i DEPARTMENT OF NATURAL RESOURCES 550 WEST 7THAVENUE, SUITE 800 ANCHORAGE, ALASK4 99501-3510 DIVISION OF OIL AND GAS PHONE: (907) 269-8800 FAX (907) 269-8938 August 29, 2002 Evergreen Resources Alaska Corp. Attn. John Tanigawa PO Box 871845 Wasilla, AK 99687 Re: Pioneer Unit Plan of Operation LO/CI 02-09 Pilots Wells 2002 Activity Subsurface Surface Pilot #1 Pads 1,2,3,4 Stromberg/Smith Stromberg/Smith Pilot #2 Pads 1,2,3,4 ADL 384685 State Pilot #3 Pads 1,2 MHTL MHTL Pilot #3 Pads 3,4 ADL 384685 State Dear Mr. Tanigawa: Evergreen Resources Alaska Corp. (Evergreen) applied for a Plan of Operations approval to drill and test 3 pilot projects in the Pioneer Unit. Under the terms of the Unit Agreement the Plan of Operation has been reviewed and found in compliance with the mitigation measures and advisories contained in the most recent Cook Inlet Areawide Sale. The Unit Plan of Operation is approved subject to Attachment 1 (ACMP Requirements), Attachment 2 (Well Data Submittal), and the following: Gravel drill pads shall be offset at least 25 feet from: a) the toe of the shoulder or top of cut banks of constructed public roads; and b) from section line easements, platted easements, or rights -of -way; and c) from the centerline of public trails that continue past the wellsite; and d) from a property line when the surface of an adjacent parcel is under different ownerhip. 2. Construction of permanent roads and pads on state owned surface is prohibited during the exploration phase. In addition to other rehabilitation requirements, upon abandonment roads must be removed to the extent they are rendered impassable, and rehabilitated in such a manner that any placed gravel remaining approximates surrounding natural features. Roads and pads may become permanent if needed in the development or transportation phase or for other beneficial purposes if approved. 3. Roads and pads on private property or Mental Health Trust Land may have other beneficial uses. The gravel structures will remain or be removed at the end of the drilling program according to the respective rights of the permittee and the surface owners. LOCI 02-09 Pioneer Pilot Wells 0 4. When the state does not own the subsurface of the location of the project the surface entry is not an exercise of the rights granted in the state oil and gas lease. This approval does not authorize surface entry that is not also a valid exercise of entry rights obtained elsewhere. 5. Lessee will notify this office at 269-8776 when drilling commences at each well site. 6. Well tests must be pre -approved as part of a unit plan of exploration or unit plan of development, and the unit operator shall report all production to the Division of Oil and Gas in accordance with the appropriate royalty accounting procedures. For questions concerning royalty and operator reporting, contact Jim Stouffer, Chief of Royalty Accounting at 907-269-8796. 7. A Status Report for the activities conducted under this approval must be filed with this office on May 1 and November 1 each year, from the date this approval is issued and until a Completion Report is filed with the Division. Failure to file in a timely manner may result in revocation of this approval. The report shall contain a statement describing clean-up activities conducted, the method of debris disposal, and a narrative description of known incidents of surface damage. 8. The applicant shall defend, indemnify and hold the State of Alaska harmless from and against any and all claims, damages, suits, losses, liabilities and expenses for injury to or death of persons and damage to or loss of property arising out of or in connection with the entry on and use of State lands authorized under this approval by the applicant, its contractors, subcontractors and their employees. 9. The applicant shall inform and insure compliance with any and all conditions of this approval by its employees, agents and contractors, including subcontractors at any level. 10. The Commissioner of the Department of Natural Resources may require that an authorized representative be on -site during any operations conducted under this approval. 11. Rehabilitation shall be completed to the satisfaction of the Commissioner. 12. The Alaska Historic Preservation Act (AS 41.35.200) prohibits the appropriation, excavation, removal, injury, or destruction of any state-owned historic, prehistoric (paleontological) or archaeological site without a permit from the commissioner. Should any sites be discovered during the course of field operations, activities that may damage the site will cease and the Office of History and Archaeology in the Division of Parks and Outdoor Recreation ((907) 762-2622). 13. This approval does not authorize activity on Mental Health Trust Lands or Lands owned by the University of Alaska. This activity, with the attached stipulations, is consistent with the Alaska Coastal Management Program and the Local District Plan. This final consistency determination is a final administrative decision for the purposes of Alaska Apellate Rules 601-612. Any appeal from this decision to the superior court must be made within 30 days of the date of the determination. This approval is issued in accordance with Alaska Statute 38.05, Alaska Administrative Code 11 AAC 83.158 or 11 AAC 83.343, and Alaska Statute 46.40. A person affected by this decision may appeal it, in accordance with 11 AAC 02. Any appeal must be received by August 29, 2002 and may be mailed or delivered to Pat Pourchot, Commissioner, Department of Natural Resources, 550 W. 7th Avenue, Suite 1400, Anchorage, Alaska 99501; faxed to 1-907-269-8918, or sent by electronic mail to dnr—appeals@dnr. state. ak.us . This decision takes effect immediately. If no appeal is filed by the Page 2 LOCI 02-09 Pioneer Pilot Wells 0 16 appeal deadline, this decision becomes a final administrative order and decision of the department on the 31 st day after issuance. An eligible person must first appeal this decision in accordance with 11 AAC 02 before appealing this decision to Superior Court. A copy of 11 AAC 02 may be obtained from this office or any regional information office of the Department of Natural Resources. This approval signifies only that the State of Alaska has no objection to the operations outlined in the lease operations application. It does not constitute certification of any property right or land status claimed by the applicant nor does it relieve the applicant of responsibility to obtain approvals or permits from other persons or governmental agencies that may also be required. All stipulations contained in the original lease and subsequent approvals remain in effect. If activities have not commenced, this approval expires at midnight, August 29, 2005. Failure to comply with the terms and conditions outlined in the lease, the attached stipulations, and this authorization may result in revocation of this Lease Operations approval. If you have any questions please contact the Division of Oil and Gas in Anchorage, at 269-8776, fax 269-8943, or e-mail mwr@dnr.state.ak.us. Sincerely, /S/ Matt Rader Natural Resources Manager Attachments: ACMP Requirements Well Data Submittal Page 3 Waivers for the following regulations are hereby granted for Bering #3 (Permit No. 202-177): 20 AAC 25.030 (d) (2), requiring conductor casing to be cemented to surface; 2. 20 AAC 25.033 (b), requiring drilling fluid of sufficient density for overbalance; 3. 20 AAC 25.035, blowout prevention equipment requirements; 4. 20 AAC 25.050 (a) (2), requiring well bore surveys for each 500 feet of well depth; 5. 20 AAC 25.061 (a), requiring seismic surveys of near surface strata; and 6. 20 AAC 25.066, requiring gas detection on drilling rigs. 0 0 CHECKLIST -SPACING EXCEPTION APPLICATION OPERATOR Evergreen Resources PROPERTY ID/ LEASE ADL 384685 FIELD/POOL Pioneer, Tyonek Undefined WELL NAME Berina #3 VERTICAL X EXPLORATORY X GAS X DEVIATED DELINEATION OIL DEVELOPMENT SURFACE LOCATION PRODUCTIVE INTERVALS (Top and Bottom) BOTTOM HOLE 1523' FSL and 471' FEL, S. 30, T18N, R1W, S.M. Same Same Same Check applicable reason(s) for spacing exception: (1 to drill a well for oil within 500 feet of a property line X 2 to drill a well for gas within 1500 feet of a property line (3) to drill and complete more than one oil well in a governmental quarter section; or to drill and complete an oil well closer than 1000' to any well drilling to or capable of producing from the same pool (4) to drill and complete more than one gas well in a governmental section; or or to drill and complete a gas well closer than 3000' to any well drilling to or capable of producing from the same pool Does the application contain: YES A brief explanation for why the operator has chosen to drill the specified location. A plat drawn to a scale of one inch equaling 2,640 feet or larger, showing the location of the well or portion of the well for which the exception is sought, all other YES completed and drilling wells on the property, and all adjoining properties and wells within 1,000 feet of a well or portion of the well requiring the spacing exception that is drilling for oil or within 3,000 feet of a well or portion of the well requiring the spacing exception that is drilling for gas. The names of all owners, landowners, and operators of all properties within 1,000 YES feet of a well or portion of the well requiring the spacing exception that is drilling for oil or within 3,000 feet of a well or portion of the well requiring the spacing exception that is drilling for gas. A copy of the notice sent by certified mail to the owners, landowners and operators YES described above, the date of mailing, and the addresses to which the notice was sent. YES An affidavit by a person acquainted with the facts verifying that all facts are true and that the plat correctly portrays pertinent and required data. NA If the operator requests a variance from the notice requirements of 20AAC25.055(d), sufficient information to demonstrate that it is not feasible to comply with the notice requirements because of the complexity of ownership within the notice area. RESOURCES (ALASKA) CORP. Is A Subsidiary of Evergreen Resources, Inc. August 26 2002 Ms. Cammy Oechsli-Taylor, Chair Alaska Oil and Gas Conservation Commission 333 West 7t' Ave., Suite 100 Anchorage, Alaska 99501 RE: Application for Permit to Drill: Bering Number 3 NE/SE of Sec 30 Twp 18 North Rng 1 West Pioneer Unit, Matanuska-Susitna Borough Target: Tertiary Tyonek, Proposed TD: 2990 Feet Proposed Spud Date: 15-Sep-2002 Dear Ms. Oechsli -Taylor, Evergreen Resources Alaska Corporation hereby applies for a Permit to Drill for the subject well located approximately 30 miles north of Anchorage. The well is planned as a shallow, straight hole drilled to evaluate the producibility of the Tyonek Coals. A local water well drilling contractor will casing drill a 12-3/4" conductor past the base of the unconsolidated gravels and cement the conductor in place. Evergreen's Ingersoll Rand RD-20 air -drilling rig, which recently arrived in Alaska, will then drill the 11" surface hole to a depth that protects the fresh water aquifer. A string of 8-5/8" surface casing will be run and cemented to the surface. A 7-7/8" hole will then be drilled to TD and a string of 5-1/2" casing will be run and cemented to surface. The entire drilling process takes less than 3 days. i Attached is information required by 20 AAC 25.005 (a) and (c) for your review. Due to the differences in equipment and methods used for air -drilling coal bed methane (CBM), we require several variances from current AOGCC regulations. These variances are recapitulated in this APD. Three items are of note. First, Evergreen has already contacted adjacent mineral interest owners. All parties, whether they be the State of Alaska or the Bureau of Land Management, know that some well locations are within 1,500 feet of our adjoining property lines.' All affected parties are support of our exploration efforts. Secondly, to better determine the depth that surface casing should be run, an induction log will be run to determine the appropriate depth of the surface casing for the pilot. Finally, we will run a directional survey in the first one or two wells in the cased hole to prove that down hole hammer drilling must drill straight holes. The designated contact for reporting responsibilities to the Commission is John Tanigawa, Alaska Projects Manager, 907-841-0000 as outlined in 20 AAC 25.070 and 20 AAC 25.071. Evergreen appreciates you and your staff's assistance during this, our first drilling campaign in Alaska. We look forward to working with you in the future. Sincerely, (ALASKA) CORPORATION Alaska Projects Manager enclosures P.O. Box 871845 - Wasilla, AK 99687 - TEL 907.357.8130 - FAX 907,3578340 "PLEASE DETACH AT PERFORATION ABOVE^ ItCIt::I M EVERGREEN RESOURCES, NC, JT-1 Check 'No' Check Date Check Amount 0083004904 05/30/2002 Evergreen Operating Corp 1401 17th Street, Suite 120 Denver CO 80202 Drilling "PLEASE DETACH AT PERFORATION ABOVE" Check Number 008300490,e . . 0.00 100.00 �mnI Int — inn nn TRANSMITAL LETTER CHECK LIST CIRCLE APPROPRIATE LETTER/PARAGRAPHS TO BE INCLUDED IN TRANSMITTAL LETTER WELL NAME �6 >~ r PTD# Z—�.Z i 7 CHECK WHAT ADD-ONS "CLUE" APPLIES (OPTIONS) MULTI The permit is for a new wellbore segment of LATERAL existing well , Permit No, API No. (If API number Production should continue to be reported as last two (2) digits a function of the original API number, stated are between 60-69) above. PILOT HOLE In accordance with 20 AAC 25.005(f), all (PH) records, data and logs acquired for the pilot hole must be clearly differentiated in both name (name on permit plus PH) and API number (50 - 70/80) from records, data and logs acquired for well (name on permit). SPACING The permit is approved subject to full EXCEPTION compliance with 20 AAC 25.055. Approval to perforate and produce is contingent upon issuance of a conservation order approving a spacing exception. V (Company Name) assumes the liab ty of any protest to the spacing exception that may occur. DRY DITCH All dry ditch sample sets submitted to the SAMPLE Commission must be in no greater than 30' sample intervals from below the permafrost or from where samples are first caught and 10' sample intervals through target zones. Rev: 07/10/02 0jody\templates womfiffiffew COMPANY EVERGREEN WELL NAME BERING 3 PROGRAM Exploratory (EXP) X Development (DEV)! Redril Service (SER) Well bore seg _Annular disposal para req FIELD & POOL 610500 nitial Class/Type EXP / 1-GAS GEOL AREA 820 UNIT No. 51550 ON/OFF SHORE On ADMINISTRATION 1. Permit fee attached............................................................................................. Yes # 0083004904 2. Lease number appropriate.................................................................................... No ADL 384685 based on DNR Mineral Estate map. 3. Unique well name and number............................................................................. Yes 4. Well located in a defined pool................................................................................ No Bering 3 will be located in the Pioneer unit in an undefined pool within the T onek Fm. 5. Well located proper distance from drilling unit boundary .............................................. No SPACING EXCEPTION REQUIRED. 8-28-02: Phone John T. 8-30-02: Phone John T. and discuss requirements. SFD 9-6-02: John will 6. Well located proper distance from other wells........................................................... Yes First well in Sec. 30, T18N, R1 W SM. provide spacing exception application to AOGCC shortly. Email him AOGCC checklist to aid hi APPR DATE 7. Sufficient acreage available in drilling unit................................................................ Yes First well in Sec. 30, T18N, Rt W, SM in building his applications. SFD 8. If deviated, is wellbore plat included........................................................................ Not A licable: vertical well SFD 9/6/2002 9. Operator only affected party.................................................................................. Yes 10, Operator has appropriate bond in force .................................................................. Yes 11. Permit can be issued without conservation order ..................................................... No SPACING EXCEPTION REQUIRED; text for public notice drafted 8-29-02. Waiting on application. SFD 12. Permit can be issued without administrative approval ............................................... Yes 13 Can permit be approved before 15-day wait........................................................... No (For Service Well Only) 14 Well located within area and strata authorized by Injection Order# NotA licable (For Service Well Only) 15 All wells witthin 1/4 mile area of review identified..................................................... Not Applicable 16 ACMP Finding of Consistency has been issued for this projec.................................... Yes 8-29-02: DNR rules that the project is consistent with the Alaska Coastal Management Program and the Local District Plan. SFD ENGINEERING 17 Conductor string provided................................................................................... Yes 12-1/4" @ 125'. 18 Surface casing protects all known USDWs............................................................. Yes 8-28-02: No information. 9-6-02: Offset well data and Evergreen's C-Plan Exemption request suggests that casing set at the proposed 300' 19 CMT vol adequate to circulate on conductor & surf csg............................................. Yes Surface Casing depth should be adequate to protect glacial till layer, which is the drinking water aquifer for this area. 20 CMT vol adequate to tie-in long string to surf csg..................................................... Yes Nearest drinking water wells are about 1 mile away, and they range in depth from 41 to 285 feet deep. 21 CMT will cover all known productive horizons......................................................... Yes Surface hole will be logged prior to setting casing and cementing it to surface to ensure that drinking 22 Casing designs adequate for C, T, B & permafrost ................................................... Yes water is protected. SFD 23 Adequate tankage or reserve pit........................................................................... Yes 24 If a re -drill, has a 10-403 for abandonment been approved ........................................ Not Applicable 25 Adequate wellbore separation proposed................................................................ Yes 26 If diverter required, does it meet regulations........................................................... Yes 27 Drilling fluid program schematic & equip list adequate .............................................. Yes Air drilled. APPR DATE 28 BOPEs, do they meet regulation.......................................................................... Not Applicable 29 BOPE press rating appropriate; test to .................... psig ........................... Not Applicable WGA 8/30/2002 30 Choke manifold complies w/API RP-53 (May 84)..................................................... Not Applicable 31 Work will occur without operation shutdown........................................................... Yes 32 Is presence of H2S gas probable.......................................................................... No (For Service Well Only) 33 Mechanical condition of wells within AOR verified .................................................... NotApplicable GEOLOGY 34 Permit can be issued w/o hydrogen sulfide measures ............................................... Yes 35 Data presented on potential overpressure zones ..................................................... No 8-28-02: No information provided. 9-6-02: Pioneer 15DD 4 miles S reportedly drilled interval with 8.4 ppg. Pioneer 14CC drilled APPR DATE 36 Seismic analysis of shallow gas zones.................................................................. Not Applicable interval with 9.2 ppg mud. Pittman 1 4 miles tested 120 b/d gassy water with SIP of 640 psi at-1100', and 37 Seabed condition survey (if off-shore)................................................................... Not Applicable this inteval was drilled with 9.5 ppg mud. AK94CBM 1 mile S driiiing records contain no into on mud SFD 9/6/2002 38 Contact name/phone for weekly progress reports [exploratory only] .......................... Yes John Tani awa: 907-841-0000 weights used to drill the interval. Evergreen will have materials and means to create 10.5 ppg mud onsite. GEOLOGY: ENGINERING: RES. ENGINERING: COMMISSION: Comments/Instructions �l(o`�Z 8-28-02: Spacing exception required to produce the well. Directional survey required as this well is within 500' of property line. SFD RPC: TEM: J"DH:�- COT: SFD: WGA:`` MJW: DTS: r bl
