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Home My WebLink AboutCO 408Conservation Order Cover Page XHVZE This page is required for administrative purposes in managing the scanning process. It marks the extent of scanning and identifies certain actions that have been taken. Please insure that it retains it's current location in this file. ~~-Z Conservation Order Category Identifier Organizing RESCAN [] Color items: [] Grayscale items: [] Poor Quality Originals: [] Other: NOTES: BY: ROBIN Scanning Preparation BY: ROBIN DIGITAL DATA [] Diskettes, No. [] Other, No/Type OVERSIZED (Scannable with large plotteflscanner) [] Maps: [] Other items OVERSIZED (Not suitable for plotter/scanner, may work with 'log' scanner) [] Logs of various kinds [] Other TOTAL PAGES Production Scanning Stage I PAGE COUNT FROM SCANNED DOCUMENT: ~ PAGE COUNT MATCHES NUMBER IN SCANNING PREPARATION: Y YES __ NO Stage 2 IF NO IN STAGE 1, PAGE(S) DISCREPANCIES WERE FOUND: __ YES NO (SCANNING IS COMPLETE AT THIS POINT UNLESS SPECIAL ATTENTION IS REQUIRED ON AN INDIVIDUAL PAGE BASIS DUE TO QUALITY, GRAYSCALE OR COLOR IMAGES) I IIII I III I II I II I I II I I I General Notes or Comments about this Document: 5/21/03 ConservOrdCvrPg.wpd Index Conservation Order 408 Cook Inlet Fields 1) October 27, 1997 Marathon Oil Company's Request Spacing Exception 2) November 5, 1997 Marathon Oil /Company's letter indicating which field/pool 3) November 14, 1997 Notice of Public Hearing, Affidavit of Publication 4) November 26, 1997 Marathon Oil Company's Request Spacing Exception 5) December 4, 1997 Objections 6) December 18, 1997 Transcript 7) October 22, 2009 Marathon Oil Company's e -mail request to use capillary string installation dispensation (CO 408 -001) Conservation Order 408 STATE OF ALASKA ALASKA OIL AND GAS CONSERVATION COMMISSION 3001 Porcupine Drive Anchorage Alaska 99501-3192 Re; THE APPLICATION OF MARATHON OIL ) COMPANY for an order exempting fields in the ) COok Inlet area from thc requirements of ) 20 AAC 25.280. ) Conservation Order No. 408 Marathon Operated Cook Inlet Fields January 15, 1998 IT APPEARING THAT: Marathon Oil Company ("Marathon"), operator of several COok Inlet oil and gas fields, submitted an application on November 5, 1997, requesting exemption from the requirements of 20 AAC 25.280(a) for wells in following fields and pools: FIELD POOL Beaver Creek Beaver Creek Beluga Sterling Undefined Kenai Kenai Unit Sterling 3.0 Sterling 4.0 Sterling 5.1 Sterling 5.2 Sterling 6.0 Tyonek Undefined Cannery Loop Unit Beluga Deep Tyonek Upper Tyonek Sterling Undefined Trading Bay G-NE/Hemlock-NE NTBU Undefined 2. Notice of public hearing was published in the Anchorage Daily News on November 14, 1997. 3. The Commission received a protest and request for hearing regarding the petition from Cook Inlet Region, Inc. on November 26, 1997. 4. A hearing was held at the Commission's office on December 18, 1997. Conservation Order 408'"i January 15, 1998 Page 2 FINDINGS: . An operator of an oil and gas well must file an Application for Sundry Approvals (Form 10- 403) and receive Commission approval prior to performing well service operations (i.e., perforating or reperforating casing, well stimulation, pulling tubing, altering casing, and repairing wells). 20 AAC 25.280(a). 2. Current well activity in the Cook Inlet area is dominated by thc types of sundry operations set forth in 20 AAC 25.280(a). 3. Marathon, as a principal Cook Inlet operator, has routinely conducted sundry well operations within the aforementioned Cool Inlet fields for the past 30 years. . Information regarding the current well condition, proposed well operations, bottom-hole pressure, and well control program must be submitted with an Application for Sundry Approval. 20 AAC 25.280(b). The operator must submit a complete well record, with copy of daily reports and tests, after completing well service operations on a Report of Sundry Well Operations (Form 10-404) within 30 days after completing the operations. 20 AAC 25.280(d). 6. The operator must maintain well records and reports for at least five years. 20 AAC 25.280(c) and 20 AAC 25.070. 7. The Commission has primacy for all Class II injection wells in the state. . Well service operations on injection wells sometimes prompt additional requirements such as mechanical integrity tests. Additional requirements arc spccificd on thc commission approved Application for Sundry Approvals. 9. Commission inspectors routinely inspect drilling operations and well service operations to ensure compliance with regulations. 10. Marathon conducts an annual average of 10 sundry well operations within wells in its Cook Inlet fields. 11. Most of the fields operated by Marathon arc adjacent to populated areas on the Kenai Peninsula. 12. The Applications for Sundry Approvals is part of the public record in non-confidential well files. 13. The Application for Sundry Approvals is the only routinely filed well document that provides advance notice of an operator's intention to undertake sundry operations including modifications or repairs of wells. CONCLUSIONS: 1. Marathon conducts a few standard and routine sundry well operations in fields it operates in the Cook Inlet area each year. Conservation Order 4081 '~ January 15, 1998 Page 3 2. Marathon's record of performance shows a history of safe and responsible sundry well operations. 3. Marathon's sundry well operations in its Cook Inlet fields, while few in number each year, are likely to generate public interest because of their proximity to population centers. , Eliminating the requirements of 20 AAC 25.280(a) and (b) for all development wells in Marathon operated fields in the Cook Inlet area will not significantly reduce filing or result in administrative efficiencies for either the operator or the AOGCC because of the small number of operations undertaken on an annual basis by Marathon. 5. In order to administer the Class II UIC program, Form 10-403 must be required prior to workovers on all service wells (i.e., gas injection, water injection, and waste disposal). 6. The location of Marathon's Cook Inlet operations engenders a concern to maintain as complete as possible public record of subsurface activities on these properties. NOW, THEREFORE IT IS ORDERED THAT: The November 5, 1997 request of Marathon Oil Company for exemption from the requirements of 20 AAC 25.280(a) is denied. DONE at Anchorage, Alaska and dated Davi~W. Johnst~'i~n, Cha~i~nan'"'"'~ ~ ~ ~g~j .AI~'t~~/~ ation Commission. ~, P.E., Conunissioner Alaska Oil and Gas Conservation Commission /~'J'~naYoOi~Ca~i'G~n~ni:~i~n Commission AS 31.05.080 provides that within 20 days after receipt of written notice ofthe entry of an order, a person affected by it may file with the Conmfission an application for rehearing. A request for rehearing nmst be received by 4:30 PM on the 23rd day following the date ofthe order, or next working day ifa holiday or weekend, to be timely filed. ~llae Commission shall grant or refi~se the application in whole or in part within 10 days. The Commission can refuse an application by not acting on it within the 10-day period. An affected person has 30 days from the date the Commission refuses the application or mails (or otherwise distributes) an order upon rehearing, both being the final order of the Commission, to appeal the decision to Superior Court. Where a request for rehearing is denied by nonaction of the Conunission, the 30 day period for appeal to Superior Cotlrt lUllS from the date on which the request is deemed denied (i.e., 10th day after the application for rehearing was filed). • • 0 SEAN PARNELL, GOVERNOR ALASKA OIL AND GAS 333 W. 7th AVENUE, SUITE 100 CONSERVATION COM USSION ANCHORAGE, ALASKA 99501 -3539 PHONE (907) 279 -1433 FAX (907) 276 -7542 ADMINISTRATIVE APPROVAL: CO 408.001 Mr. Kevin Skiba Marathon Alaska Production LLC P.O. Box 196168 Anchorage, AK 99519 Re: Request for Form 10 -403 dispensation for capillary string installations. Beaver Creek, Kasilof, Kenai, Kenai Cannery Loop Unit, Ninilchik, Sterling, West Fork, and Wolf Lake Fields, and the Sunrise Lake Project. Dear Mr. Skiba: The Alaska Oil and Gas Conservation Commission (AOGCC or Commission) hereby approves Marathon Alaska Production LLC (Marathon)'s request for Form 10 -403 dispensation for capillary string installations in the subject fields' wells. Marathon installs capillary strings in production wells that have relatively low pressure and are struggling to maintain a minimum flow rate. If remedial efforts are not undertaken to remove infiltrating water, the wells will eventually be unable to sustain flow and critical production will be removed from the area's already stressed gas supply system. I The Commission finds that capillary string installation has become routine, with minimal risks to personnel, property, and the environment. Elimination of the Form 10 -403 requirement would enhance Marathon's response time when facing production interruptions. It would also allow Marathon the ability to better utilize the limited resources available on the Kenai Peninsula. AOGCC's administrative approval to eliminate the Form 10 -403 requirement for capillary string installations is conditioned upon the following: 1. This approval applies to production wells in the following fields: Beaver Creek, Kasilof, Kenai, Kenai Cannery Loop Unit, Ninilchik, Sterling, West Fork, and Wolf Lake; 2. This approval further applies to production wells in the Sunrise Lake area; 3. Marathon shall report to the Commission all capillary string installations on Form 10 -404, and in accordance with 20 AAC 25.080 (d). I CO 408.001 • October 27, 2009 Page 2 of 2 DONE at Anchorage, Alaska and dated October 27, 2009. Daniel T. eamount, Jr. Cath P. Foerster . N rma Chairman Commissioner Commissioner RECONSIDERATION AND APPEAL NOTICE As provided in AS 31.05.080(a), within 20 days after written notice of the entry of this order or decision, or such further time as the Commission ' grants fox "good cause shown, a person affected by it may file with the Commission an application for reconsideration of the matter determined the'notice was mailed, then the period of time shall be 23 days. An application for reconsideration must set out the respect in which the `-order or decision is believed to be erroneous. The Commission shall grant or refuse the application for reconsideration in whole or in part within 10 days after it is filed. Failure to act on it within 10 -days is a denial of reconsideration. If the Commission denies reconsideration, upon denial, this order or decision and the denial of re- consideration are FINAL and may be appealed to superior court. The appeal MUST be filed within 33 days after the date on which the Com- mission mails, OR 30 days if the Commission otherwise distributes, the order or decision denying reconsideration, UNLESS the denial is by in- action, in which case the appeal MUST be filed within 40 days after the date on which the application for reconsideration was filed. If the Commission grants an application for reconsideration, this order or decision does not become final. Rather, the order or decision on re- consideration will be the FINAL order or decision of the Commission, and it may be appealed to superior court. That appeal MUST be filed within 33 days after the date on which the Commission mails, OR 30 days if the Commission otherwise distributes, the order or decision on re- consideration. As provided in AS 31.05.080(b), "[t]he questions reviewed on appeal are limited to the questions presented to the Commission by the application for reconsideration." In computing a period of time above, the date of the event or default after which the designated period begins to run is not included in the period; the last day of the period is included, unless it falls on a weekend or state holiday, in which event the period runs until 5:00 p.m. on the next day that does not fall on a weekend or state holiday. • • Mary Jones David McCaleb Cindi Walker XTO Energy, Inc. IHS Energy Group Tesoro Refining and Marketing Co. Cartography GEPS Supply & Distribution 810 Houston Street, Ste 2000 5333 Westheimer, Ste 100 300 Concord Plaza Drive Ft. Worth, TX 76102 -6298 Houston, TX 77056 San Antonio, TX 78216 George Vaught, Jr. Jerry Hodgden Richard Neahring PO Box 13557 Hodgden Oil Company NRG Associates Denver, CO 80201 -3557 408 18th Street President Golden, CO 80401 -2433 PO Box 1655 Colorado Springs, CO 80901 Mark Wedman Schlumberger Ciri Halliburton Drilling and Measurements Land Department 6900 Arctic Blvd. 2525 Gambell Street #400 PO Box 93330 Anchorage, AK 99502 Anchorage, AK 99503 Anchorage, AK 99503 Baker Oil Tools Ivan Gillian Jill Schneider 4730 Business Park Blvd., #44 9649 Musket Bell Cr. #5 US Geological Survey Anchorage, AK 99503 Anchorage, AK 99507 4200 University Dr. Anchorage, AK 99508 Gordon Severson Jack Hakkila Darwin Waldsmith 3201 Westmar Cr. PO Box 190083 PO Box 39309 Anchorage, AK 99508 -4336 Anchorage, AK 99519 Ninilchick, AK 99639 James Gibbs Kenai National Wildlife Refuge Penny Vadla PO Box 1597 Refuge Manager 399 West Riverview Avenue Soldotna, AK 99669 PO Box 2139 Soldotna, AK 99669 -7714 Soldotna, AK 99669 -2139 Richard Wagner Cliff Burglin Bernie Karl PO Box 60868 PO Box 70131 K &K Recycling Inc. Fairbanks, AK 99706 Fairbanks, AK 99707 PO Box 58055 Fairbanks, AK 99711 North Slope Borough PO Box 69 Barrow, AK 99723 le�y /61 ---q `� /o • Page 1 of 1 Colombie, Jody J (DOA) From: Colombie, Jody J (DOA) Sent: Tuesday, October 27, 2009 2:35 PM To: Ballantine, Tab A (LAW); 'Aaron Gluzman'; caunderwood @marathonoil.com; 'Dale Hoffman'; Frederic Grenier; 'Gary Orr'; Jerome Eggemeyer; 'Joe Longo'; 'Lamont Frazer'; Marc Kuck; 'Mary Aschoff; Maurizio Grandi; P Bates; Richard Garrard; 'Sandra Lemke'; 'Scott Nash'; 'Steve Virant'; 'Wayne Wooster'; 'Willem Vollenbrock'; 'William Van Dyke'; Woolf, Wendy C (DNR); 'Anna Raff; 'Barbara F Fullmer'; 'bbritch'; 'Bill Walker'; 'Bowen Roberts'; 'Brad McKim'; 'Brandon Gagnon'; 'Brian Gillespie'; 'Brian Havelock'; 'Brit Lively'; 'Bruce Webb'; 'buonoje'; 'Cammy Taylor'; 'Cande.Brandow'; 'carol smyth'; 'Charles O'Donnell'; Chris Gay; 'Cliff Posey'; 'Dan Bross'; 'dapa'; 'Daryl J. Kleppin'; 'David Brown'; 'David Gorney'; David House; 'David L Boelens'; 'David Steingreaber'; 'ddonkel'; Deborah Jones; Decker, Paul L (DNR); 'doug_schultze'; 'Evan Harness'; 'eyancy'; 'foms2 @mtaon line. net'; 'Francis S. Sommer'; 'Fred Steece'; 'Garland Robinson'; 'Gary Laughlin'; 'Gary Rogers'; 'Gary Schultz'; 'ghammons'; 'Gordon Pospisil'; 'Gregg Nady'; 'gspfoff; 'Hank Alford'; 'Harry Engel'; 'jah'; 'Janet D. Platt'; 'jejones'; 'Jerry Brady'; 'Jerry McCutcheon'; 'Jim Arlington'; 'Jim White'; 'Jim Winegarner'; 'Joe Nicks'; 'John Garing'; 'John S. Haworth'; 'John Spain'; 'John Tower'; 'John W Katz'; 'Jon Goltz'; Joseph Darrigo; 'Julie Houle'; 'Karl Moriarty'; 'Kaynell Zeman'; 'Keith Wiles'; knelson @petroleumnews.com; 'Krissell Crandall'; 'Kristin Elowe'; 'Laura Silliphant'; 'mail= akpratts @acsalaska.net'; 'mail= foms @mtaonline.net'; 'Marilyn Crockett; 'Mark Dalton'; 'Mark Hanley'; 'Mark Kovac'; 'Mark P. Worcester; 'Marguerite kremer; Melanie Brown; 'Michael Nelson'; 'Mike Bill'; 'Mike Jacobs'; 'Mike Mason'; 'Mike) Schultz'; 'Mind Lewis'; 'MJ e Y Loveland'; 'mjnelson'; 'mkm7200'; 'Nick W. Glover'; NSK Problem Well Supv; NSU, ADW Well Integrity Engineer; 'Patty Alfaro'; 'Paul Winslow'; 'peter Contreras'; Rader, Matthew W (DNR); Raj Nanvaan; 'Randall Kanady'; 'Randy L. Skillern'; 'Rob McWhorter'; rob.g.dragnich @exxonmobil.com; 'Robert Campbell'; 'Robert Province'; 'Rudy Brueggeman'; 'Sandra Pierce'; 'Scott Cranswick'; 'Shannon Donnelly'; 'Sharmaine Copeland'; Shellenbaum, Diane P (DNR); Slemons, Jonne; 'Sondra Stewman'; 'Sonja Frankllin'; 'Stan Porhola'; 'stanekj'; 'Steve Lambert'; 'Steve Moothart'; 'Steven R. Rossberg'; 'Susan Roberts'; 'Suzanne Gibson'; 'tablerk'; 'Tamera Sheffield'; 'Ted Rockwell'; 'Temple Davidson'; Teresa Imm; 'Terrie Hubble'; 'Thor Cutler'; 'Todd Durkee'; Tony Hopfinger; 'trmjrl'; 'Von Hutchins'; 'Walter Featherly'; Williamson, Mary J (DNR); Aubert, Winton G (DOA); Brooks, Phoebe; Crisp, John H (DOA); Darlene Ramirez; Davies, Stephen F (DOA); Fleckenstein, Robert J (DOA); Foerster, Catherine P (DOA); Grimaldi, Louis R (DOA); Johnson, Elaine M (DOA); Jones, Jeffery B (DOA); Laasch, Linda K (DOA); Mahnken, Christine R (DOA); Maunder, Thomas E (DOA); McIver, Bren (DOA); McMains, Stephen E (DOA); Noble, Robert C (DOA); Norman, John K (DOA); Okland, Howard D (DOA); Paladijczuk, Tracie L (DOA); Pasqual, Maria (DOA); Regg, James B (DOA); Roby, David S (DOA); I Saltmarsh Arthur C (DOA); Scheve, Charles M DOA); Schwartz, Guy L (DOA); Seamount, Dan T (DOA) Subject: co408 -001 and co625 Attachments: co625.pdf; co408- 001.pdf Joclv J. Colombie Special Assistant Alaska Oil cmcl Gas Conservation Commission 333 O'est 71h Avenue, Suite 100 Anchorage, AK 99501 (900793 -1221 (phone) (907)276 -7542 (f a) 10/27/2009 ~7 ~, ._,.~ Colombie, Jody J (DOA) From: Aubert, Winton G (DOA) Sent: Monday, October 26, 2009 3:18 PM To: Colombie, Jody J (DOA) Subject: FW: Capillary String Installation Dispensation From: Skiba, Kevin J. [mailto:kskiba@marathonoil.com] Sent: Thursday, October 22, 2009 12:27 PM To: Aubert, Winton G (DOA) Subject: Capillary String Installation Dispensation Winton, Marathon Oil requests dispensation from the 10-403 pre-approval process when installing capillary strings. We install capillary strings in wells that have relatively low pressure and are struggling to maintain a minimum flow rate. If remedial efforts are not undertaken, to remove the infiltrating water, the wells will eventually be unable to sustain flow and critical production will be removed from the area's already stressed gas supply system. The process of installing capillary strings has become a routine exercise with minimal risks to personal, equipment, and the environment. Documentation of these installations would still be provided to the AOGCC, as we already do when adjusting capillary sting depths, on the follow up 10-404 Report. Adopting this method would enhance Marathon's response time when facing production interruptions. It would also allow Marathon the ability to better utilize the limited resources available on the Peninsula. An additional benefit, to both organizations, is the reduction of the paper work processing that would be associated with each future installation. Marathon has utilized the capillary string remediation activities in most of its Alaskan fields including: Kenai Gas Field, Cannery Loop, Beaver Creek, Ninilchik Unit, and the Sterling Unit. Marathon is requesting that the suggested dispensation be approved for the above mentioned fields along with Wolf Lake, West Fork, Kasilof, and the Sunrise Lake project, which is under development. Sincerely, Kevin Skiba Regulatory Compliance Technician Marathon Alaska Production LLC Office (907) 283-1371 Fax (907) 283-1350 10/27/2009 ~s 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 ALASKA OIL AND GAS CONSERVATION COMMISSION PUBLIC HEARING In Re: THE APPLICATION OF MARATHON OIL COMPANY FOR EXCEPTION TO 20 AAC 25.280 FOR COOK INLET OIL AND GAS FIELDS. TRANSCRIPT OF PROCEEDINGS Anchorage, Alaska December 18, 1997 9:00 o'clock a.m. APPEARANCES: Commissioners: MR. DAVID W. JOHNSTON, CHAIRMAN MR. WILLIAM N. CHRISTENSEN MS. CAMILLE OECHSLI Marathon Oil Co.: Cook Inlet Region Inc.: MR. GARY LAUGHLIN MR. AL HASTINGS RECEIVED JAN -7 1998 Naska Oil & Gas Cons. Commission · Anchorage ORIGINAL ELITE COURT REPORTING 4051 East 20th Avenue #65 · Anchorage Alaska 99508 907.333.0364 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 PROCEEDINGS (On record - 9:03 a.m.) CHAIRMAN JOHNSTON: I'd like to call this public hearing into session, please. I'll note the time is approximately three minutes after the hour of 9:00 o'clock. The date is December 17, 1997. We're located in the offices of the Alaska Oil & Gas Conservation Commission, located at 3001 Porcupine Drive, Anchorage, Alaska. The head table consists of Chairman David Johnston, Commissioner Bob Christensen and Commissioner Cammie Oechsli. Laurel Earl of Elite Court Reporting will be making the transcript of these proceedings, and I'd ask if you wish to receive a copy of the transcript that you contact Elite Court Reporting directly for that. The purpose of these proceedings is to review the request of Marathon Oil Company for an exception to the provisions of 20 AAC 25.280(a). That regulation requires commission approval of an application for sundry approval, Form 10-403, before entering a well to perforate casing to stimulate the well or to pull tubing, alter casing or repair the well. Marathon seeks this exception for defined pools in the following fields: Beaver Creek, Kenai, Sterling, and Trading Bay. Public notice was given in the Anchorage Daily News on November 14, 1997. In response to that notice Cook Inlet Region Inc. filed a protest. We are now here to hear from both ELITE COURT REPORTING 4051 East 20th Avenue #65 · Anchorage Alaska 99508 907.333.0364 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Marathon and CIRI in this matter. At this time I'd like to enter into the public record the notice that was provided by the commission, and I'd like to note that that is Exhibit 1 -- Commission Exhibit 1, as I indicated earlier, published in the Anchorage Daily News on November 14, 1997, and it was signed by me. I would also like to enter into the public record the letter received from Cook Inlet Region Inc., protesting the granting of this exception to the regulation for Marathon. The date of that letter is November 26, 1997, and it was addressed to David Johnston of the Commission, and it was signed by Gerald G. Booth, Vice President of Resources for Cook Inlet Region Inc. The order of testimony will have Marathon appearing first, followed by CIRI, and then we felt it would be appropriate to allow each side a short rebuttal if appropriate. We will conduct this hearing in accordance with 20 AAC 25.540. Those are our commission regulations guiding us in public hearings. That does allow for the commission to accept sworn testimony or unsworn statements. And at this point we would allow you to decide whether you wish to be sworn in this matter or not. I'm not sure if you're going to be attesting to factual information or stating an opinion. So, again, we'll let that be at the discretion of the individuals testifying before the commission. If you wish to be considered an expert witness in this ELITE COURT REPORTING 4051 East 20th Avenue ~65 . Anchorage Alaska 99508 907.333.0364 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 matter, we'd ask you to state your qualifications and then the commission would rule as to whether we would consider you an expert. We will not be allowing questions from the audience, but again since there is no audience other than the two participants here, I don't expect any questions from them. But if somebody does come in from the public and wishes to ask a question, those questions would be forwarded to the front table and we would ask them if we thought it was germane. So at this point I guess we're now ready to invite Marathon to step forward and indicate why you believe we should grant this exception. MR. LAUGHLIN: Marathon Oil Company. My name is Gary Laughlin, representing I would like to make one, I believe, correction to your earlier statement. This covers 20 AAC 25.280(a) and (b). I think you just stated (a) only. CHAIRMAN JOHNSTON: Our Public Notice said paragraph (a). Let's see, yeah, I think we're just dealing with a technicality. Paragraph (a) sets the purpose of the sundry approval; paragraph (b) just merely indicates the type of information that you would attach to it. So technically we're just talking about the exception to paragraph (a). MR. LAUGHLIN: Fair enough. CHAIRMAN JOHNSTON: Before you proceed did you wish to offer sworn testimony? MR. LAUGHLIN: No, I don't. ELITE COURT REPORTING 4051 East 20th Avenue ~65 . Anchorage Alaska 99508 907.333.0364 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 expert? CHAIRMAN JOHNSTON: Okay, fine. MR. LAUGHLIN: I don't need it in this. CHAIRMAN JOHNSTON: Do you wish to be considered an MR. LAUGHLIN: No. CHAIRMAN JOHNSTON: Please proceed. MR. LAUGHLIN: I guess basically I would like to follow the same path that Unocal followed in applying for this exception to this 20 AAC 25.280(a). Marathon has been working in the Cook Inlet for, I guess, close to 30 years now, if not exceeding 30 years. Our operations and Unocal's operations are very similar, if not identical in a lot of ways. I believe that the filling out of the 10- -- eliminating filling out the 10-403s will streamline paperwork for both the state and for Marathon, and provide -- this does not preclude Marathon from filling out the 10-404 which indicates work that has been completed. Marathon intends to fill those out and file those with the commission, leaving an accurate record of work that has been done. Essentially, that's everything I've got to say. CHAIRMAN JOHNSTON: Any questions? MS. OECHSLI: I have no questions. MR. CHRISTENSEN: I have no questions. CHAIRMAN JOHNSTON: At this time the commission doesn't have any questions for you, but we may have questions following ELITE COURT REPORTING 4051 East 20th Avenue ~65 . Anchorage Alaska 99508 907.333.0364 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 the testimony from CIRI. MR. LAUGHLIN: Fair enough. Thank you. MR. HASTINGS: Good morning. CHAIRMAN JOHNSTON: Good morning. I'm A1 Hastings, I'm the Director of Oil and Gas for Cook Inlet Region Inc. and ..... CHAIRMAN JOHNSTON: Before you proceed do you wish to offer sworn testimony ..... MR. HASTINGS: No, I do not. CHAIRMAN JOHNSTON: ..... or be considered an expert? MR. HASTINGS: Not in this case. CHAIRMAN JOHNSTON: Very good. Please proceed. MR. HASTINGS: We're one of the royalty owners on the Kenai gas field, Beaver Creek, Sterling units, and as a royalty owner we have a limited opportunity to follow the activity that goes on in the field, and the sundry notices are one of the ways that we've done that in the past. However, the completion notice of work that's actually been done actually provides us probably better information than the sundry notice, so if we were able to receive completion notices of work that's been done in the three fields, that would satisfy our concerns on this issue. CHAIRMAN JOHNSTON: In the past we have granted the exception to -- the requirement for sundry approvals. Notably we've done it for certain fields on the North Slope, and we have also done it in the Cook Inlet in the following fields; ELITE COURT REPORTING 4051 East 20th Avenue #65 · Anchorage Alaska 99508 907.333.0364 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 McArthur River, Swanson River, Mill Ground Shoal, Granite Point, Trading Bay, Iven River and Lewis River. And the procedures that we have elected to employ is for the operator to provide a letter to us outlining the fact that they are planning to do the work in a well, like pull tubing or perforate casing. And normally it's just a listing of information rather than all the detail that is required on the Form 403. Based upon that we then direct our inspectors to the various activities that are occurring out in the oil patch, so we have that oversight. Then we do require the 404, the report of that activity. Now in terms of providing a copy of that, are you requesting that the commission provide that to you or that you'd be requesting that from the operator to provide that to you directly? MR. HASTINGS: I'm not sure that the commission normally provides completion notices to royalty owners. And whether it comes from the commission or from the operator is immaterial to us. It's just that we would like some way to be able to have some understanding of what goes on. CHAIRMAN JOHNSTON: Am I understanding then that -- are you drawing the distinction between having that information, the 404, just in the Well Completion or the Well History files or you would like to have a copy directly sent to CIRI? MR. HASTINGS: We'd like to have a copy sent directly ELITE COURT REPORTING 4051 East 20th Avenue ~65 · Anchorage Alaska 99508 907.333.0364 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 to us because if we don't know that the work is being done then we have no way of knowing that we need to go to your files to find out what's happened. CHAIRMAN JOHNSTON: So would you see that as a reasonable condition for the commission to establish in any order that we would care to adopt in this matter that the operator would be obligated to provide the royalty owner a copy of the completion report? MR. HASTINGS: Yeah, the same version that goes to you ..... CHAIRMAN JOHNSTON: Right. MR. HASTINGS: ..... we would just receive a copy of it. Yes, that would satisfy our concern completely. CHAIRMAN JOHNSTON: Very good. Any questions? MS. OECHSLI: I have no questions. MR. CHRISTENSEN: No questions. CHAIRMAN JOHNSTON: Okay. Maybe we could have the Marathon representative step forward again? I think you heard the representative from the CIRI indicate that they would no longer have a protest to this exception if we were to condition the Conservation Order with a requirement that a copy of the 404 be sent directly to the royalty owner. Do you think that Marathon would have any difficulty with that requirement? MR. LAUGHLIN: No. CHAIRMAN JOHNSTON: Okay. Very good. Any other ELITE COURT REPORTING 4o51 East 20th Avenue #65 · Anchorage Alaska 99508 907.333 °0364 10 11 12 13 14 15 16 17 18 19 20 21 2¸2 23 24 25 questions then? MS. OECHSLI: I don't have any other questions. MR. CHRISTENSEN: No questions. CHAIRMAN JOHNSTON: Well, I think at this point we've taken care of matters here and I think we can adjourn this session. Thank you very much. (Off record - 9:16 a.m.) END OF PROCEEDINGS ELITE COURT REPORTING 4051 East 20th Avenue ~65 · Anchorage Alaska 99508 907.333,0364 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 C E R T I F I C A T E UNITED STATES OF AMERICA) )SS. STATE OF ALASKA ) I, Laurel L. Earl, Notary Public in and for the State of Alaska, and Reporter for Elite Court Reporting, do hereby certify: That the foregoing Alaska Oil & Gas Conservation Commission Hearing, was taken before me on the 18th day of December 1997, commencing at the hour of 9:00 o'clock a.m., at the offices of Alaska Oil & Gas Conservation Commission, 3001 Porcupine Street, Anchorage, Alaska; That the hearing was transcribed by myself to the best of my knowledge and ability. IN WITNESS WHEREOF, I have hereto set my hand and affixed my seal this 6th day of January 1998. Notary Public in and for Alaska ~ NOTARY PUBLIC ~ ,~ My Comm. exp~.~'e~: ...l.L:..~..:.?....~.. ...... ~ ELITE COURT REPORTING 4051 East 20th Avenue ~65 · Anchorage Alaska 99508 907.333.0364 NAME - COMPANY (PLEASE PRINT) ALASKA OIL AND GAS CONSERVATION COMMISSION PUBLIC HEARING MARATHON EXCEPTION TO 20 AAC 25.280 - COOK INLET DECEMBER 18~ 1997 9:00 AM SIGN IN PLEASE PHONE DO YOU PLAN TO TESTIFY? YES NO 7 9 10 11 12 13 14 15 16 17 19 20 21 22 23 24 25 Condcnselt! m ~ Re: Marathon Oil Co. 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 ALASKA OIL AND GAS CONSERVATION COMMISSION PUBLIC HEARING In Re: THE APPLICATION OFMARATHON OIL COMPANY FOR EXCEPTION TO 20 AAC 25.280 FOR COOK INLET OIL AND GAS FIELDS. TRANSCRIPT OF PROCEEDINGS Anchorage, Alaska December 18, 1997 9:00 o'clock a.m. APPEARANCES: Commissioners: Marathon Oil Co.: Cook Inlet Region Inc.: MR. DAVID W. JOHNSTON, CHAIRMAN MR. WILLIAM N. CHRISTENSEN MS. CAMILLE OECHSLI MR. GARY LAUGHLIN MR. AL HASTINGS RECEIVED JAN -7 1998 Alaska Oil & Gas Cons. Commission Anchorage Page 3 1 Marathon and cau in this matter. 2 At this time I'd like to enter into thc public record 3 the notice that was provided by the commission, and I'd like to 4 note that that is Exhibit 1 -- Commission Exhibit 1, as I 5 indicated earlier, published in the Anchorage Daily News on 6 November 14, 1997, and it was signed by me. I would also like 7 to enter into the public record the letter received from Cook 8 Inlet Region Inc., protesting the granting of this exception to 9 the regulation for Marathon. The date of that letter is 10 November 26, 1997, and it was addressed to David Johnston of 11 the Commission, and it was signed by Gerald G. Booth, Vice 12 President of Resources for Cook Inlet Region Inc. 13 The order of testimony will have Marathon appearing 14 first, followed by emi, and then we felt it would be 15 appropriate to allow each side a short rebuttal if appropriate. 16 We will conduct this hearing in accordance with 20 AAC 25.540. 17 Those are our commission regulations guiding us in public 18 hearings. That does allow for the commission to accept sworn 19 testimony or unsworn statements. And at this point we would 20 allow you to decide whether you wish to be sworn in this matter 21 or not. I'm not sure if you're going to bc attesting to 22 factual information or stating an opinion. So, again, we'll 23 let that be at the discretion of the individuals testifying 24 before the commission. 25 If you wish to be considered an expert witness in this Page 2 PROCEEDINGS 1 (On record - 9:03 a.m.) 2 CHAIRMAN JOHNSTON: t'd like to call this public 3 Page 4 hearing into session, please, rll note the time is approximately three minutes after the hour of 9:00 o'clock. The date is De, centber 17, 1997. We're located in the offices of the Alaska Oil & Gas Conservation Commission, located at 3001 Porcupine Drive, Anchorage, Alaska. The head table consists of matter, we'd ask you to state your qualifications and then the commission would rule as to whether we would consider you an expert. We will not be allowing questions from the audience, 4 but again since there is no audience other than the two 5 participants here, I don't expect any questions from them. But 6 if somebody does come in from the public and wishes to ask a 7 question, those questions would be forwarded to the front table 8 and we would ask them if we thought it was germane. Chairman David Johnston, Commissioner Bob Christensen and Commissioner Cmnmie Oechsli. Laurel Earl of Elite Com~ Reporting will be making the transcript of these proceedings, and I'd ask if you wish to receive a copy of the transcript that you contact Elite Court Reporting directly for that. The purpose of these proceedings is to review the request of Marathon Oil Company for an exception to the 9 So at this point I guess we're now ready to invite 10 Marathon to step forward and indicate why you believe we should 11 grant this exception. 12 Ma. LAUGHLIN: My name is Gary Laughlin, representing 13 Marathon Oil Company. I would like to make one, I believe, 14 correction to your earlier statement. This covers 20 15 25.280(a) and Co). I think you just stated (a) only. CHALRMAN JOHNSTON: (~ Public Notice said paragraph (a). Let's see, yeah, I think we're just dealing with a 18 technicality. Paragraph (a) sets the purpose of the sundry 19 approval; paragraph Co) just merely indicates the type of 20 information that you would attach to it. So technically we're 21 just talking about the exception to paragraph (a). 22 MR. LAUGHLIN: Fair enough. 23 CHAmMAN JOHNSTON: Before you proceed did you wish to 24 offer sworn testimony? 25 MR. LAUGHLIN: No, I don't. provisions of 20 sc 25.250(a). That regulation requires 16 commission approval of an application for sundry approval, Form 17 10-403, before entering a well to perforate casing to stimulate the well or to pull tubing, alter casing or repair the well. Marathon seeks this exception for defined pools in the following fields: Beaver Creek, Kenai, Sterling, and Trading Bay. Public notice was given in the Anchorage Daily News on November 14, 1997. In response to that notice Cook Inlet Region Inc. filed a protest. We are now here to hear from both ELITE COURT REPORTING DUPLiC/;(rE Page 1 - Page 4 AOGCC Hearing, 12=18-9~' CondcnsoIt! m {. Re: Marathon Oil Co. Page 5 Page 7 1 McArthur River, Swanson River, Mill Ground Shoal, Granite 2 Point, Trading Bay, Iven River and Lewis River. And the 3 procedures that we have elected to employ is for the operator 4 to provide a letter to us outlining the fact that they are 5 planning to do thc work in a well, like pull tubing or 6 perforate casing. And normally it's just a listing of 1 CHAmMAN JOHNSTON: Okay, fine. 2 Ms. LAUGHLIN: I don't need it in this. 3 cm~mvtn~ JOHNSTON: Do you wish to be considered an 4 expert? 5 MR. LAUGHLIN: No. 6 cmm~MnN JOHNSTON: Please proceed. 7 MK LAUOHLIN: I guess basically I would like to follow 8 the same path that Unocal followed in applying for this 9 exception to this 20 Anc 25.280(a). Marathon has been working 10 in the Cook Inlet for, I guess, close to 30 years now, if not 11 exceeding 30 years. Our operations and Unocal's operations arc 12 very similar, if not identical in a lot of ways. I believe 13 that the filling out of the 10- -- eliminating filling out the 14 10-403s will streamline paperwork for both the state and for 15 Marathon, and provide -- this does not preclude Marathon from 16 filling out the 10-404 which indicates work that has been 17 completed. Marathon intends to fill those out and file those 18 with the commission, leaving an accurate record of work that 19 has been done. 20 Essentially, that's everything I've got to say. 21 cHnmMAN JOHNSTON: Any questions? 22 MS. OECHSLI: I have no questions. 23 Mr{. CHRISTENSEN: I have no questions. 24 Cm~RMAN JOHNSTON: At this time the coaunission doesn't 25 have any questions for you, but we may have questions following Page 6 1 the testimony from cfm. 2 Ma. LAUGHLIN: Fair enough. Thank you. 3 m~. HASTINOS: Good morning. 4 CHAmMAN JOHNSTON: Good morning. I'm A1 Hastings, I'm 5 the Director of Oil and Gas for Cook Inlet Region Inc. and ..... 6 CH~dKMnN JOHNSTON: Before you proceed do you wish to 7 offer sworn testimony ..... 8 MR. HASTINGS: No, I do not. 9 CHAIRMAN JOHNSTON: ..... or be considered an expert? 10 Ma. HASTINOS: Not in this case. 11 CHAmMAN JOHNSTON: Very good. Please proceed. 12 Ma. HAsTr~Gs: We're one of the royalty owners on the 13 Kenai gas field, Beaver Creek, Sterling units, and as a royalty 14 owner we have a limited opportunity to follow the activity that 15 goes on in the field, and the sundry notices are one of the 16 ways that we've done that in the past. However, the completion 17 notice of work that's actually been done actually provides us 18 probably better information than the sundry notice, so if we 19 wcrc able to receive completion notices of work that's been 20 done in the three fields, that would satisfy our concerns on 21 this issue. 22 c~ JOHNSTON: In the past we have granted the 23 exception to -- the requirement for sundry approvals. Notably 24 we've done it for certain fields on the North Slope, and we 25 have also done it in the Cook Inlet in the following fields; 7 information rather than all the detail that is required on the 8 Form 403. Based upon that we then direct our inspectors to the 9 various activities that are occurring out in the oil patch, so 10 we have that oversight. Then we do require the 404, the report 11 of that activity. 12 Now in terms of providing a copy of that, are you 13 requesting that thc commission provide that to you or that 14 you'd be requesting that from the operator to provide that to 15 you directly? 16 Ma. HASTINGS: I'm not sure that the commission 17 normally provides completion notices to royalty owners. And 18 whether it comes from the commission or from the operator is 19 immatea/al to us. It's just that we would like some way to be 20 able to have some understanding of what goes on. 21 CmURMA~ JOHNSTON: Am I understanding then that -- are 22 you drawing the distinction between having that information, : 23 the 404, just in the Well Completion or the Well History files 24 or you would like to have a copy directly sent to c~? 25 Ma. HASTINGS: We'd like to have a copy sent directly Page 8 1 to us because if we don't know that the work is being done then 2 we have no way of knowing that we need to go to your files to 3 find out what's happened. 4 CHAIRMAN JOHNSTON: So would you see that as a 5 reasonable condition for the commission to establish in any 6 order that we would care to adopt in this matter that the 7 operator would be obligated to provide the royalty owner a copy 8 of the completion report? 9 Ma. HASTINGS: Yeah, the same version that goes to 10 you ..... 11 CHAmM~ JOHNSTON: Right. 12 MR. HASTnqGs: ..... we would just receive a copy of it. 13 Yes, that would satisfy our concern completely. 14 CmUR~ JOHNSTON: Very good. Any questions? 15 MS. OECHSLI: I have no questions. 16 MR. CHRISTENSEN: No questions. 17 CHAmMAN JOHNSTON: Okay. Maybe we could have the 18 Marathon representative step forward again? I think you heard 19 thc representative from the cfm indicate that they would no 20 longer have a protest to this exception if we were to condition 21 thc Conservation Order with a requirement that a copy of the 22 404 bc sent directly to the royalty owner. Do you think that 23 Marathon would have any difficulty with that requirement? 24 MR. LAUGHLIN: NO. 25 ci~xrox~ JOHNSTON: Okay. Very good. Any other ELITE COURT REPORTING Page 5 - Page 8 AOGCC Hearing, 12-18-9~.. 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Condenselt! TM Page 9 1 questions then? 2 MS. OECHSLI: I don't have any other questions. 3 MR. CHRISTENSEN: No questions. 4 CHAIRMAN JOHNSTON: Well, I think at this point we've taken care of matters here and I think we can adjourn this session. Thank you very much. (Off record - 9:16 a.m.) END OF PROCEEDINGS 6 7 8 9 10 11 12 13 14 15 16 .17 :18 19 20 21 22 23 24 25 CERTIFICATE UNITED STATES OF AMERICA /ss. STATE OF ALASKA ) I, Laurel L. Earl, Notary Public in and for the State of Alaska, and Reporter for Elite Court Reporting, do hereby certify: That the foregoing Alaska Oil & Gas Conservation Cmmnission Hearing, was taken before me on the 18th day of December 1997, commencing at the hour of 9:00 o'clock a.m., at the offices of Alaska Oil & Gas Conservation Commission, 3001 Porcupine Street, Anchorage, Alaska; That the hearing was transcribed by myself to the best of my knowledge and ability. tN WtTN~S WHEREOF, t have hereto set my hand and affixed my seal this 6th day of January 1998. Notary Public in and for Alaska Re: Marathon Oil Co. ELITE COURT REPORTING Page 9 - Page 0 AOGCC Hearing, CondonsoIt!TM 1 - longer 12-18-9~ Re: Marathon Oil Co. 10:3,5,7,10,11,17 4:13 Essentially[il 5:20 6:8,10,12 7:16,25 8:9,12 -1- allow [31 3:15,18,20 completed Ill 5:17 !establish iai 8:5 head iai 2:8 I [21 3:4,4 allowing[il 4:3 completely[ii 8:13 exceeding[il 5:11 hear[il 2:25 10 pi 5:13 alter Ill 2:19 completion [51 6:16,19 exception [91 1:5 2:15 heard ill 8:18 10-403 Ill 2:18 AMERICA IH 10:2 7:17,23 8:8 2:20 3:8 4:11,21 5:9 6:23 hearing [sl 1:2 2:4 3:16 10-403s [1] 5:14 Anchorage [51 1:9 2:8 concern [1] 8:13 8:20 10:8,12 10-404 [1] 5:16 2:23 3:5 10:11 concerns Iii 6:20 Exhibit [2] 3:4,4 hearings Ill 3:18 APPEARANCES [11 condition [21 8:5,20 expect Ill 4:5 hereby [11 10:5 14 [21 2:24 3:6 1:11 conduct[a] 3:16 expert[41 3:25 4:3 5:4 hereto[Il 10:14 17[1] 2:6 appearing[i] 3:13 Conscrvation[s~ 1:I 6:9 I-Iistory[1] 7:23 18 Ill 1:9 application[2] 1:5 2:17 2:7 8:21 10:7,10 houri21 2:5 10:9 18th [11 10:8 applying Ill 5:8 consider[il 4:2 -F- 1997161 1:9 2:6,24 3:6 appropriate[21 3:15,15 cons]de[calm 3:25 5:3 Fill 10:1 -I- 3:10 10:9 1998 iii 10:15 approval [al 2:17,17 6:9 fact IH 7:4 identical Iii 5:12 4:19 consists Ill 2:8 factual[i] 3:22 immaterial Ill 7:19 approvals Ill 6:23 contact[i] 2:13 Fa]ri2] 4:22 6:2 Inc [5] 1:14 2:25 3:8,12 -2- attach[il 4:20 Cook[a] 1:6,14 2:24 3:7 felt[il 3:14 6:5 20 [5] 1:5 2:16 3:16 4:14 attesting Ill 3:21 3:12 5:10 6:5,25 field [2] 6:13,15 indicate [21 4:10 8:19 5:9 audience [21 4:3,4 copy[?l 2:12 7:12,24,25 fields[51 1:6 2:21 6:20 indicated[i] 3:5 25.280 [4] 1:5 2:16 4:15 8:7,12,21 6:24,25 indicates [2] 4:19 5:16 5:9 correction IH 4:14 file D] 5:17 25.540 [11 3:16 -B- Court [al 2:10,13 10:5 individuals IH 3:23 filed iai 2:25 information £51 3:22 26 iii 3:10 bBased[2] 4:15,19[al 7:8 coverScreek Ia]Ill 2:214:146:13 files [21 7:23 8:2 4:20 6:18 7:7,22 -3- Bay[21 2:22 7:2 fill IH 5:17 Inlet[a] 1:6,14 2:24 3:8 30121 5:10,11 Beaver[21 2:21 6:13 -D- fillingtal 5:13,13,16 3:125:106:5,25 3001 [21 2:7 10:10 best [11 10:12 fine [al 5:1 inspectors t~l 7:8 better[al 6:18 Dial 2:1 ;fi[still 3:14 intends iai 5:17 -4- between[il 7:22 Daily[al 2:23 3:5 follow[21 5:7 6:14 invite[a] 4:9 Bob iai 2:9 date[2] 2:6 3:9 followed[2] 3:14 5:8 issue IH 6:21 403[a1 7:8 Boo[hill 3:11 .Day]dial 1:122:9 3:10 following[al 2:21 5:25 Iven[a] 7:2 404 [al 7:10,23 8:22 dealing D] 4:17 6:25 _C_ December[al 1:92:6 foregoing[al 10:7 -J- 10:9 Form [2] 2:17 7:8 January Ill 10:15 -6- Cia] 2:1 10:1,1 decide[al 3:20 forward[2l 4:10 8:18 Johnston[2al 1:12 2:3,9 6th[al 10:15 CAMILLE[al 1'13 defined[al 2:20 forwarded[al 4:7 3:10 4:16,23 5:1,3,6,21 -9- Cammie Iai 2:10 detail [al 7:7 front [1] 4:7 5:24 6:4,6,9,11,22 7:21 care [2] 8:6 9:5 difficulty iai 8:23 8:4,11,14,17,25 9:4 9:00[al 1:102:5 10:9 casoDl 6:10 direct[a] 7:8 -Ct 9:03[11 2:2 casing[a] 2:18,197:6 directly[51 2:13 7:15,24 Gl21 2:1 3:11 -K- 9:16 m 9:7 certain D] 6:24 7:25 8:22 certify iai 10:6 Directorial 6:5 Gary [21 1:14 4:12 Kcnai [2] 2:21 6:13 gas [71 1:1,6 2:7 6:5,13 knowing [~1 8:2 -m- Chairman [22] 1:12 2:3 discretion [al 3:23 10:7,10 knowledge IH 10:13 a.m[q 1:10 2:2 9:7 10:9 2:9 4:16,23 5:1,3,6,21,24 distinction[il 7:22 Gerald[al 3:11 6:4,6,9,11,22 7:21 8:4,11 doesn't [al 5:24 AAC [51 1:5 2:16 3:16 4:14 5:9 8:14,17,25 9:4 germane [11 4:8 -L- done [7] 5:19 6:16,17,20 given [al 2:23 L IH 10:4 ability[il 10:13 Christensen[51 1:122:9 6:24,25 8:1 5:23 8:16 9:3 drawing [al 7:22 goes [al 6:15 7:20 8:9 Laughlin D0] 1:14 4:12 able [21 6:19 7:20 CIRI [5] 3:1,14 6:1 7:24 Drive iai 2:8 good [51 6:3,4,11 8:14,25 4:12,22,25 5:2,5,7 6:2 accept iai 3:18 8:19 Granite pi 7:1 8:24 accordance Iai 3:16 close iii 5:10 Laurel [21 2:10 10:4 accurate [11 5:18 Co DI 1:14 -E- grant Ill 4:11 granted Iai 6:22 leaving [al 5:18 activities Ill 7:9 commencing [1] 10:9 E [4] 2:1,1 10:1,1 granting [1] 3:8 letter [al 3:7,9 7:4 activity[2] 6:147:11 commission[iai 1:1 2:7 Earl[2] 2:10 10:4 GroundD] 7:1 Low]sD] 7:2 addrcsscdtll 3:10 2:17 3:3,4,11,17,18,244:2 elected[al 7:3 guoss[a] 4:9 5:7,10 limited[il 6:14 adjourn[~] 9:5 5:18,247:13,16,18 8:5 el]mina[ingle] 5:13 guiding[al 3:17 listing[il 7:6 adopt m 8:6 10:8,10 Elite Iai 2:10,13 10:5 located [21 2:6,7 affixed[il 10:15 Commissioner[21 2:9 employ[il 7:3 2:10 -H- longer Ill 8:20 again iai 3:22 4:4 8:18 Commissioners [al END Ill 9:8 Ali21 1:14 6:4 1:12 enter[21 3:2,7 hand iai 10:14 -M- Alaska[lei 1:1,9 2:7,8 Company[al 1:5 2:15 entering[il 2:18 Hastings Del 1:14 6:3,4 ELITE COURT REPORTING Index Page 1 AOGCC Hearing, 12-18-9~' Condenselt! TM Marathon - years Re: Marathon Oil Co. Marathon [aSl 1:5,14 2:15,20 3:1,9,13 4:10,13 5:9,15,15,17 8:18,23 matter[41 3:1,20 4:1 8:6 matters £a1 9:5 may [al 5:25 McArthur [u 7:1 merely [~1 4:19 Mill Bl 7:1 minutes raj 2:5 morning [21 6:3,4 MS [n] 1:13 5:22 8:15 9:2 -N- N[2] 1:12 2:1 name pi 4:12 need P-I 5:2 8:2 News [21 2:23 3:5 normally [21 7:6,17 North pi 6:24 Notably Iai 6:23 Notary [21 10:4,17 note [2] 2:4 3:4 notice [q 2:23,24 3:3 4:16 6:17,18 notices [3] 6:15,19 7:17 November [31 2:24 3:6 3:10 now [4] 2:25 4:9 5:10 7:12 -O- O Bi 2:1 o'clock[al 1:10 2:5 10:9 obligated m 8:7 occurring Iai 7:9 Oechsli [a 1:13 2:10 5:22 8:15 9:2 Off IH 9:7 offer£21 4:24 6:7 offices [2] 2:6 10:10 oil flU 1:1,5,6,14 2:7,15 4:13 6:5 7:9 10:7,10 one [3] 4:13 6:12,15 operations [21 5:11,11 operator [q 7:3,14,18 8:7 opinion [q 3:22 opportunity[il 6:14 order raj 3:13 8:6,21 outlining [ii 7:4 oversight [ii 7:10 owner [3] 6:14 8:7,22 owners [2] 6:12 7:17 -p- P D] 2:1 paperwork Ill 5:14 paragraph [q 4:16,18 4:19,21 participants m 4:5 past [21 6:16,22 patch [1] 7:9 path [u 5:8 p~r['orate [21 2:18 7:6 planning [al 7:5 point [41 3:19 4:9 7:2 9:4 pools [ii 2:20 Porcupine [21 2:8 10:11 preclude Iai 5:15 President ral 3:12 procedures m 7:3 proceed £41 4:23 5:6 6:6 6:11 proceedings [q 1:8 2:11 2:14 9:8 protest [21 2:25 8:20 protesting Ill 3:8 provide [51 5:15 7:4,13 7:14 8:7 provided[il 3:3 provides [21 6:17 7:17 providing Ill 7:12 provisions Ill 2:16 public riel 1:2 2:3,23 3:2 3:7,17 4:6,16 10:4,17 published iai 3:5 pull r21 2:19 7:5 pul'pOSe [21 2:14 4:18 -Q- qualifications [11 4:1 questions [lni 4:3,5,7 5:21,22,23,25,25 8:14,15 8:16 9:1,2,3 -R- RI2] 2:1 10:1 rather[il 7:7 Re Ill 1:4 ready D] 4:9 reasonable Iai 8:5 rebuttal £11 3:15 receive [3] 2:12 6:19 8:12 received[ii 3:7 record [51 2:2 3:2,7 5:18 9:7 Region [5] 1:14 2:25 3:8 3:12 6:5 regulation [21 2:16 3:9 regulations [~i 3:17 repair [~1 2:19 repolt [21 7:10 8:8 Reporter [al 10:5 Reporting [31 2:11,13 10:5 representative [~-1 8:18 8:19 representing m 4:12 request Bl 2:15 requesting [21 7:13,14 require [ii 7:10 required m 7:7 requirement [31 6:23 8:21,23 requires D] 2:16 gesourees [H 3:12 response Iai 2:24 review Bi 2:14 Right [H 8:11 River [4] 7:1,1,2,2 royalty [51 6:12,13 7:17 8:7,22 nile [H 4:2 -S- S [H 2:1 satisfy[2] 6:20 8:13 seal Ill 10:15 see [2] 4:17 8:4 seeks Bl 2:20 sent [3] 7:24,25 8:22 session [21 2:4 9:6 set [H 10:14 sets D] 4:18 Shoal Bi 7:1 short [H 3:15 side pi 3:15 signed I2i 3:6,11 similar[i] 5:12 Slope Ill 6:24 ss Bi 10:2 state i4i 4:1 5:14 10:3,4 statement nl 4:14 statements Ill 3:19 STATES [ii 10:2 stating Ill 3:22 step [21 4:10 8:18 Sterling [21 2:21 6:13 stimulate hl 2:18 streamline [11 5:14 Street [H 10:11 sundly[5] 2:17 4:18 6:15 6:18,23 Swanson Bi 7:1 sworn [41 3:18,20 4:24 6:7 T I2l 10:1,1 tablo [21 2:8 4:7 technicality raj 4:18 technically Ill 4:20 telmS Ill 7:12 testifying [al 3:23 tostimony [51 3:13,19 4:24 6:1,7 Thank [21 6:2 9:6 thought tli 4:8 throe [21 2:5 6:20 Trading [21 2:21 7:2 transcribed m 10:12 transcriptm 1:8 2:11 2:12 tubing [2] 2:19 7:5 two Ill 4:4 type Bi 4:19 -U- IYNITED [al 10:2 units [H 6:13 Unocal Ill 5:8 Unocal's [11 5:11 unSWOrn Ill 3:19 -V- various Ill 7:9 version m 8:9 Vice Ill 3:11 -W- W[1] 1:12 ways [21 5:12 6:16 WHEREOF raj 10:14 WILLIAM ill 1:12 wish [61 2:12 3:20,25 4:23 5:3 6:6 wishes [ii 4:6 witness [2] 3:25 10:14 -y- years [21 5:10,11 ELITE COURT REPORTING Index Page 2 ~~ TONY KNOWLES, GOVERNOR ~'~ ~OMMISSION 3001 PORCUPINE DRIVE ANCHORAGE, ALASKA 99501-3192 PHONE: (907) 279-1433 FAX: (907) 276-7542 December 4, 1997 Mr. Gerald G. Booth Vice President, Resources Cook Inlet Region, Inc. P O Box 93330 Anchorage, AK 99509-3330 Dear Mr. Booth: The Commission has received your objection to Marathon's request for an exception to the provisions of 20 AAC 25.280(a) to eliminate the requirement for filing a form 10-403 before initiating certain workover operations on wells located on the Kenai Peninsula and offshore in the Cook Inlet. It has been determined you have raised a substantial and material issue; therefore, a heating is scheduled for 9:00 AM, December 18, 1997 at the above ad&ess. We look forward to your attendance. · Chairman TONY KNOWLE$, GOVERNOR ALASi~ 011~~ GAS CONSERYATION~O~SSION 3001 PORCUPINE DRIVE ANCHORAGE, 'ALASKA 99501-3192 PHONE: (907) 279-1433 FAX: (907) 276-7542 December 4, 1997 Mr. Gary Laughlin Computer Geoscientist Marathon Oil Company P O Box 196168 Anchorage, AK 99519-6168 Dear Mr. Laughlin: The Commission has received an objection from Cook Inlet Region, Inc. to your request for an exception to the provisions of 20 AAC 25.280(a) for wells located on the Kenai Peninsula and offshore in the Cook Inlet (enclosed). Accordingly, as stated in the Notice of Public Hearing published in the Anchorage Daily News on November 14, 1997, a hearing is scheduled for 9:00 AM, December 18, 1997 at the above address. David W~ohnston Chairman (Enclosure) Notice of Public Hearing STATE OF ALASKA Alaska Oil and Gas Conservation Commission Re~ The application of Marathon Oil Company for exception to 20 AAC 25.280 for Cook Inlet oil and gas fields. Marathon Oil Company bx' lctter dated Novcmbcr 5. 1997 has rcqucstcd an cxccption to the provisions of 20 AAC 25.280(a). The exception would eliminate the requirement for filing a form 10-403 (Application for Sundrx' Approvals) before initiating ccrtain workovcr opcrations on wells in the following fields and pools located on thc Kcnai Peninsula and offshore in thc Cook Inlet. FIELD POOL Beaver Creek Beaver Creek Beluga Sterling Undcfincd Kenai Kenai Unit Sterling 3.0 Sterling 4.0 Sterling 5.1 Sterling 5.2 Sterling 6.0 Tyonck Undefined Sterling Trading Bay CanneD' Loop Unit Beluga Dccp Tyonck Upper Tvonck Undefined G-NE/Hclnlock-NE NTBU Undefined A person who max' be harmed if the rcqucsted order is issued may file a written protest prior to 4:00 PM November 28, 1997 with the Alaska Oil and Gas Conservation Commission, 3001 Porcupine Drive, Anchorage, Alaska 99501, and rcqucst a hearing on thc mattcr. If the protcst is timely filed and raises a substantial and material issue crucial to the Commission's dctemfination, a hearing on the matter will bc held at the above address at 9:00 am on December 18, 1997 in conformance with 20 AAC 25.540. If a hearing is to be held, interested panics may confirm this by calling the Commission's office, (907) 279-1433 after November 28, 1997. If no protest is filed, the Commission will consider the issuance of the order without a hearing. If you are a person with a disal Ct ~Ii~-x~~modification in order to ~.,~i~279-1433-.. no later than D~avid !°l.~t°n"~' /" ~ Commissio~ comment or to attend thc December 117 1997. Published November 14, 1997 ADN AO 02814013 4o cc am RECEIVED COOK INLET REGION, INC. November 26, 1997 Mr. David W. Johnston Naska 0il & Gas Cons. Commission Anchorage Chairman/Commissioner Alaska Oil and Gas Conservation Commission 3001 Porcupine Drive Anchorage, AK 99501-3192 Via Telecopier (907) 276-7542 Subject: Marathon Oil Company Request for Exception to 20 AAC 25.280(a) Workover Operations Application Submittal Dear Commissioner Johnston: In the matter of the above November 14, 1997 notice provided by AOGCC, it is CIRI's understanding that Marathon Oil Company (MOC) is requesting that the requirement for filing form 10-403, Application for Sundry Approvals, be eliminated for workover operations at the Beaver Creek, Kenai, Sterling, and Trading Bay Units. Cook Inlet Region, Inc. (CIRI) has the following comments hereby submitted as a written protest to MOC's request. As stated in the Alaska Administrative Code, the Application for Sundry Approvals is required to be submitted to and is subject to the approval of the AOGCC for subsurface well operations on state, federal, and private lands. AOGCC's review process ensures that well operations are monitored and are in compliance with regulations before an operator enters a producible or injection well. Further in 20 AAC 25.280, the following information is to be furnished: the current condition of the well; the proposed well plan; the BOP equipment specifications for meeting regulatory requirements, and the description of workover fluids for well control. CIRI believes the requirement to submit this information is essential to the monitoring and oversight role AOGCC is designated to perform under Sec. 31.05.030. It is CIRI's position that the requirements of 20 AAC 25.280(a) are also in place to provide critical information to all members of the public potentially affected by the activities relating to specified well operations and conditions during drilling, especially owners of surface and subsurface estate within affected units. CIRI owns a large portion of the subsurface estate included in leases in the Beaver Creek, Kenai, and Sterling Units (Beaver Creek Unit - 5,580.25 of the total 9,260.25 lease acres; Kenai Unit - 8,575.41 acres of the total 18,691.45 lease acres; Sterling Unit - 3,867 of the total 5,175.31 acres). Many of these leases were initially negotiated by the federal government and later were transferred to CIRI as successor to the government's interest in the underlying lands patented to CIRI under ANCSA. Such leases provide little in the way of notice on many issues, and accordingly, CIRI does not currently receive copies of these reports directly from the operator; we depend on the AOGCC to ensure that operators provide critical information required for well operations to comply with protective regulations in place. The elimination of CIRI BUILDING 2525 "C" STREET P. O. BOX 93330 ANCHORAGE, ALASKA 99509-3330 (907) 274-8638 FAX (907) 279-8836 Mr. David W. Johnston Alaska Oil and Gas Conservation Commission November 26, 1997 Page 2 the submittal of this information would effectively excuse an operator from providing critical well information currently required for AOGCC's appropriate review and enforcement of compliance. And it would eliminate a subsurface estate owner's source of information as to operations occurring on its property, and the appropriate action by AOGCC to ensure compliance and enforcement. CIRI respectfully requests that AOGCC consider our comments in protest as provide above, and hereby requests that a hearing be held before MOC's request is granted. Please contact me directly if you need further information. Thank you. Sincerely, COOK INLET REGION, INC. Gerald G. Booth Vice President, Resources #3 ~7619 STOF0330 A0-02814013 $97.68 AFFIDAVIT STATE OF ALASKA, ) THIRD JUDICIAL DiSTRiCT. ) being first duly sworn on oath deposes and says that he/she is an advertising representative of the Anchorage Daily News, a daily newspaper. That said newspaper has been approved by the Third Judicial Court, Anchorage, Alaska, and it now and has been published in the English language continually as a daily newspaper in Anchorage, Alaska, and it is now and during all said time was printed in an office maintained at the aforesaid place of publication of said newspaper. That the annexed is a copy of an advertisement as it was published in regular issues (and not in supplemental form) of said newspaper on Nov. 14, 1997 and that such newspaper was regularly distributed to its subscribers during all of said period. That the full amount of the fee charged for the foregoing publication is not in excess of the rate charged private individuals. s igned~~-'~~ Subscribed and sworn to b~f~te me this ZZ day of ...~...~..~~-'~ the State of Alaska. Third Division. Anchorage. Alaska MY COMMISSION EXPIRES ............ ........... OF PUBLICATION ', Nolice of Public Hearing '~ 'STATE OF ALASKA · ": "I?:~, ','AlaSka Oil~"and Gas · ~ Conservation commission Re::"~:The al~plication of I~r6thon oi~ Companv'for excepti0h' to 20,AA'C 25.280 for CoOk inlet oil and g0s fields., ";',[,:Marathon, 'Oil 1' Company bY I~te~, dated, N6Vembe~' .5' 1997 ha~..requested afl exception to tl~e~ ,,;l~roviStons of , 20 AAC 2$.280(a), ,Tl~e' excel~tlon w0Uld~ ellminate the requirement for' ffl~ tlg a, form' 10.403 ' (Applica- tion, for ,Sunctry. All,roYals) befbre initiating certain W6rkover. operatioh's "bn wells in" the foilowirlg, fields and addle located ,on 'the' Kenai Pe~in~bla and' offshore in the rdo,~lnlet. , , , ' FIELD.. "' 'POOL BeaVer~,: ~ Beaver Creek Creek" .,. ' ,.. ~ Beluga ' i', ~;';;"'~"Sterlin~ , ,::U:ndefinect., ' / Trh~di~g'.B~'~ '.,',r"."~ .L: :.!:J.:~i. ~ 'G.iN E/ He.ml'o.c~.=N E. · ..a.~ '...'.- Nq'~,~l;O'hu~frhea" · " eci.'.:'i~':,.tl~ re. qO'eSted.:.'0r~er is is~Jed may file b written '~rotest pricer to 4:00 PM. November 28, 1997 with the Alaska Oil an~ Gos.'Conservo- rion Commission, 30~1 Po(cupine Drive, Anchproge Al'agka 99501, and' reeuest o ~eb~iff~ on'th~ mat~r.' If the ~rotest iS 'timely filed r~ises a substdntiol and. material issue cruc.lol to the Commission's determination, o hearing on the matter will be ?]~ at the a~ove address at ... ~., :... ~:~.--~: .... ,. · . .. . AAC ..... '~ :.i ~:: ..:, ,":/, /' ,~',- ,, ;: ........ . - :? '". tho =: ..... ... ;...: :-- :.' ~'}.':.~ : .... '.r.~ .... . '~:' .. ::.. '.- ~ "., the :..'s[u~n~o o~ *~ ..9r~8~ :wrmout'":o ';:1~*~ ~g., '~ ~ :.?....:~ ::.: [,~.~iol.~ccom mo~a~tion jn. .. '~;' ': ~---e~+' ~" +e' e++end I,,.~, ..:. ~,: ..... ~.,.., ,~ ~:. , :, ~-:,. . ........ ,. ~ .,. .,-..., '.. ,, .~. '~ ~2 SE~T BY:Marathon 0tl Company ;11-12-07 ; 2'22PM ; Marathon Oil Company Anchorage--, Alaska R~ Domestic ~41uCtion 007 276 7§42;# 2/ 3 P,o. Box 196168 Anchorage, AK 99519-6168 Telephona gO7/561-5311 November 5, 1997 Alaska Oil and Gas Conservation Commission 3001 Porcupine Drive Anchorage, Alaska 99501-3192 Robed Crandall, Mr. Crandall this letter is in response to our telephone conversation on November 5, 1997. You requested a list of fields and pools where Marathon Oil Company is requesting exemption from the requirements of 20 AAC 25.280(a) and (b). Below is the list of fields and pools requested. Field Pool Beaver Creek Sterling Kenai Kenai C.L.U. A subsidiary of USX Corporation Sterling Undefined Beluga Beaver Creek Undefined Sterling 3.0 Sterling 4.0 Sterling 5.1 Sterling 5.2 Sterling 6.0 Undefined Tyonek Beluga Upper Tyonek Deep Tyonek Environmentally aware for lhe long run. North Trading Bay Hemlock G Zone Undefined Thank you for your prompt response in this matter, Sincerely, ' Gary Laugi~l~i'n ~ Computer Geoscientist ~~ ~srathon Oil Company ~ O: _R-,~x :~u~6168 -~nchorage, AK 99519-6168 David W. Johnston Alaska Oil and Gas Conse~ation Commission 300~ Porcupine Drive Anchorage, AK 9950~-3~ 92 II,l,,hl,,,hl,ll,,,,,,ll,,ll,,,,lll,h,,,hl,,,lll .!" Alaska ~.. ,on Domestic Firoduction Marathon Oil Company P.O. Box 196168 Anchorage, AK 99519-6168 Telephone 907/561-5311 October 27, 1997 Alaska Oil and Gas Conservation Commission 3001 Porcupine Drive Anchorage, Alaska 99501-3192 David W. Johnston, Marathon Oil Company, the operator of several Cook Inlet oil and gas fields is requesting exemption from the requirements of 20 AAC 25.280(a) and (b) for Marathon operated wells. Marathon applauds the AOGCC for granting the Conservation Order No. 351 for Unocal Corporation. Marathon agrees with the AOGCC's conclusions, the form 10-403 must be filed for Class II wells and the form 10-404 must be filed with the commission in order to keep well files current. Eliminating the requirements of 20 AAC 25.280 (a) and (b) for all development wells in the Marathon operated fields in the Cook Inlet area will reduce filing and result in administrative efficiencies for both Marathon and the AOGCC. Marathon has a long history of safe and responsible well workover operations, at least 30 years in the Cook Inlet. Sincerely, Gary Laughlin Computer Geoscientist A subsidiary of USX Corporation Environmentally aware for the long run. Notice of Public Hearing STATE OF ALASKA Alaska Oil and Gas Conservation Commission Re~ The application of Marathon Oil Company for exception to 20 AAC 25.280 for Cook Inlet oil and gas fields. Marathon Oil Company by letter dated November 5, 1997 has requested an exception to the provisions of 20 AAC 25.280(a). The exception would eliminate the requirement for filing a form 10-403 (Application for Sundry Approvals) before initiating certain workovcr operations on wells in the following fields and pools located on the Kenai Peninsula and offshore in the Cook Inlet. FIELD POOL Beaver Creek Beaver Creek Beluga Sterling Undefined Kenai Kenai Unit Sterling 3.0 Sterling 4.0 Sterling 5.1 Sterling 5.2 Sterling 6.0 Tyonek Undefined Sterling Trading Bay Cannery Loop Unit Beluga Deep Tyonek Upper Tyonek Undefined G-NE/Hemlock-NE NTBU Undefined A person who may be harmed if the requested order is issued may file a written protest prior to 4:00 PM November 28, 1997 with the Alaska Oil and Gas Conservation Colmnission, 3001 Porcupine Drive, Anchorage, Alaska 99501, and request a hearing on the matter. If the protest is timely filed and raises a substantial and material issue crucial to the Commission's determination, a hearing on the matter will be held at the above address at 9:00 am on December 18, 1997 in conformance with 20 AAC 25.540. If a hearing is to be held, interested parties may confirm this by calling the Commission's office, (907)279-1433 after November 28, 1997. If no protest is filed, the Commission will consider the issuance of the order without a hearing. If you are a person with a disa'ltywho_ ynee spe' modification in order to con~nent or to attend the l~61ic hea-rm~pl~~~'~279-1433 no later than December 11, 1997. ~ .... Published November 14, 1997 ADN AO 02814013