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Home My WebLink AboutSIO 0042. 3. 4. 5. 6. 7 INDEX STORAGE INJECTION ORDER NO. 4 Pretty Creek Unit Pretty Creek Gas Storage Facility Pretty Creek Unit Well No. 4 May 10, 2005 Unocal's application for Gas Storage May 11, 2005 Unocal's Pretty Creek Gas Storage Lease Application ----------------- Email June 20, 2005 June 22, 2005 June 24, 2005 June 24, 2005 8. June 23, 2005 9. June 27, 2005 10. July 7, 2005 11. July 11, 2005 12. July 12, 2005 13. July 14, 2005 14. July 26, 2005 15. July 26, 2005 16. July 27, 2005 17. July 28, 2005 18. July 29, 2005 19. August 1, 2005 20. August 3, 2005 21. August 9, 2005 22. August 10, 2005 23. August 16, 2005 24. August 17, 2005 25. September 13, 2005 26. September 14, 2005 27 September 14, 2005 28. September 26, 2005 29. October 4, 2005 30. November 2, 2005 31. 2006 32. 2007 33. 2008 34. July 21, 2008 35.--------------- 36. 2009 Unocal's revised application for Gas Storage Unocal's amended application for Gas Storage Notice of Public Hearing, Affidavit of Publication, email distribution, and mailings DNR's letter re: State of ACMP Review of Gas Storage Lease Application Email from Cook Inlet Keepers Cook Inlet Keepers' letter to AOGCC Email from Unocal Trading Bay Oil and Gas request for public hearing Email from DNR Email from Unocal Transcript and sign -in sheet Memo to file Email Proposed ACMP Determination Letter from AOGCC to Unocal re: continuation of hearing DNR Comments Email to DNR from AOGCC Email Transcript, sign -in sheet and exhibits (Exhibits D and E held confidential in secure storage) Email Unocal letter to AOGCC re: hearing Pretty Creek Storage Lease Final Finding of the Director DNR Email DNR's Notice of Issuance of Gas Storage Lease Best Interest Finding and Final Consistency Determination Chevron's Request for Reconsideration (DNR) (exhibits D and E held confidential in secure storage) DNR's Approval for First Storage Development Plan Email re: Commencement of Injection Operations Monthly Reports requiring pressure monitoring Monthly Reports requiring pressure monitoring Monthly Reports requiring pressure monitoring Unocal's request to commence storage injection into the Sterling 45-0 and of the Pretty Creek Gas Storage Facility (SIO 4.001) Backup information for SIO 4.001 Monthly Reports requiring pressure monitoring 37. April 28, 2010 Email re: Gas Storage Jurisdictional Question 38. March 4, 2011 Email re: Master Well List TIO Report 39. April 1, 2011 Chevron Pretty Creek Development Plan 40.------------------- Monthly reports requiring pressure monitoring INDEX STORAGE INJECTION ORDER NO. 4 ,) ) STATE OF ALASKA OIL AND GAS CONSERVATION COMMISSION 333 West 7th A yen ue Anchorage, Alaska 99501 Re: THE APPLICATION OF UNION OIL COMP ANY OF CALIFORNIA ("Unocal") for an order authorizing the underground storage of hydrocarbons in the Beluga and Sterling Formations in Pretty Creek Unit Well No.4, Cook Inlet Area, Alaska. ) Storage Injection Order No.4 ) ) Pretty Creek Unit ) Pretty Creek Gas Storage Facility Pretty ) Creek Unit Well No.4 ) ) September 12,2005 IT APPEARING THAT: 1. By application dated May 10, 2005 and received by the Alaska Oil and Gas Conservation Commission ("Commission") on May 11, 2005, Union Oil Company of California ("Unocal") requested an order from the Commission authorizing the underground storage of hydrocarbons in the Beluga and Sterling Formations of the proposed Pretty Creek Gas Storage Facility ("PCGSF") using Pretty Creek Unit ("PCU") Well No.4. Unocal proposes to inject gas into the PCU #4 well for storage during periods of excess gas supply and to produce the gas during periods of increased demand. This well is located in Section 33, Township 14 North, and Range 9 West, Seward Meridian ("SM"). 2. Unocal submitted a revised application, dated June 20, 2005 and received June 22, 2005 that addressed errors and discrepancies in the original application. 3. Notice of opportunity for public hearing was published in the Anchorage Daily News Anchorage Daily News on June 24, 2005 in accordance with 20 AAC 25.540. 4. Cook Inlet Keeper submitted comments concerning Unocal's PCGSF Application on June 27, 2005; but did not request a public hearing. 5. On July 11, 2005 Trading Bay Oil & Gas, LLC ("TBO&G") requested the AOGCC hold a public hearing regarding Unocal's PCGSF proposal, citing correlative rights and potential encroachment on TBO&G leases to the North ofPCU. 6. The Commission convened a public hearing on July 26, 2005. The hearing was continued to August 10,2005 at the request of the Applicant and by consent ofTBO&G. 7. On August 9, 2005 Unocal submitted an email and attached documents answenng questions raised by AOGCC staff regarding the revised application 8. The public hearing was re-convened in conformance with 20 AAC 25.540 at the Commission's offices, 333 W. 7th Avenue, Suite 100, Anchorage, Alaska 99501 on August 10, 2005, at which time the Commission heard testimony concerning proposed storage of gas in and around well PCU #4. The hearing record was left open through August 17, 2005 to allow Unocal to provide exhibits and clarification to their hearing testimony. 9. On August 17, 2005 Unocal submitted an affidavit and 6 exhibits (Exhibits A, B, C, D, E, and F) to clarify testimony regarding the structure, stratigraphy and areal extent of the Storage Injection Order No. ) September 12, 2005 } Page 2 Sterling 45-0 and Beluga 51-5 sands. Exhibits D and E were submitted under seal as proprietary and confidential information related to the proceedings. 10. The hearing record was closed at 4:30 p.m. ADT on August 17,2005. FINDINGS: 1. Operator: Unocal is the operator of the PCU, which is located on the west side of Cook Inlet in Townships 13 North and 14 North, Range 9 West, SM. 2. Project Description: Unocal proposes to use PCU #4 for storage purposes as well as a periodic peak demand producer in the proposed storage program. The gas storage project will inject a significant gas volume into the available reservoir(s) at a relatively high injection rate and withdraw the gas at a relatively high rate during peak demand periods. Unocal proposes to conduct dry gas storage injection within the PCU #4 well using the Beluga Formation 51-5 sandstone ("Beluga 51-5") as a primary target. The Sterling Formation 45-0 sandstone ("Sterling 45-0") may be used as a secondary target at some point in the future. 3. Storage Area: The PCU #4 well is drilled and completed within State of Alaska Oil & Gas leases ADL 63048 and ADL 58813. The State of Alaska is the subsurface landowner within the area covered by the leases. There are no other operators within a one-quarter mile radius of the PCU #4 well. Unocal has given notice and copies of its application to the surface owners within a one-quarter mile radius of the PCU #4 well and to a surface and mineral rights owner whose land lies outside the storage area but within the current Pretty Creek Unit boundary. 4. Storage Reservoirs Description & Properties: Unocal describes the Beluga 51-5 as lying between 5144 and 5173 feet measured depth ("MD") and the Sterling 45-0 lies between 4503 and 4518 feet MD in the PCU #4 well. The Sterling Formation is comprised of interbedded sandstone, siltstone, mudstone and coal. This formation was likely deposited in a high energy meandering to braided stream environment. The Sterling 45-0 is confined by 36 feet of coal above and 33 feet of coal below. The coal is commonly called Beluga Coal and is laterally extensive and correlates across gas fields to the north and east. The Beluga Coals are described in Unocal's application as barriers between permeable sands above and below the Sterling 45-0 sandstone. The Beluga Formation lies below the Sterling and is characterized as stream sediments deposited in a low energy environment. Beluga sandstones are commonly lenticular and often discontinuous over interwell distances. The Beluga section is approximately 900 feet thick in the Pretty Creek Unit. The Beluga 51-5 is bounded above by 10 feet of impermeable interbedded siltstone, clay-rich siltstone and mudstone. Underlying the Beluga 51-5 are 21 feet of shale and shaly coal which grade to 10 feet of coal (informally termed the PC4 Beluga Coal in the PCU #4 well), which is laterally extensive and seals the overlying sand from potential permeable sands below. Storage Injection Order No. ) September 12, 2005 ) Page 3 Initial reservoir pressure estimated in PCU #4 Beluga 51-5 was 1674 psia at 3686 feet true vertical depth ("TVD"), assuming a normal 0.45 psi/foot gradient. Reservoir pressure in the PCU #4 well Beluga 51-5 has depleted to about 669 psi between December 2001 and February 2005. 5. Production & Material Balance: Production from the Sterling 45-0 and Beluga 51-5 and an underlying sandstone termed Beluga 55-6 has been commingled on occasion and has totaled 2.6 BCF. The Operator suspects the Beluga 55-6 is non-productive or depleted and did not contribute any gas during appraisal tests or attempts to produce. Unocal estimates the Beluga 51-5 originally held 2.07 Bcf gas-in-place ("GIP") based on a P/Z material balance analysis. The pressure used in the analysis was from the Beluga 51-5 when isolated from the Sterling 45-0 and the Beluga 55-6. Material balance analysis of historical production supports the contention that the Beluga 51-5 and Sterling 45-0 intervals proposed for gas storage each drain a limited area, are isolated from other strata and from each other. The Operator believes the Sterling 45-0 has watered out based on production history and performance. Gas storage in a water-saturated sand may cause production problems by increasing formation back pressure as water is produced thereby decreasing gas flow rate and increasing water handling problems at the surface. Formation water may potentially trap gas when injection displaces it and then resaturates during production operations. Unocal stated that gas was likely trapped in the Sterling 45-0 as it depleted and water encroached. The last pressure measured in the Sterling 45-0 was 687 psi during April 2004. This indicates energy remains within the reservoir. As water production from this zone increased, the amount of produced water became too great to lift from the perforations to the surface. Gas storage in the Sterling 45-0 mayor may not cause additional gas to be trapped. Unocal acknowledged the Sterling 45-0 would have slightly more risk of gas loss because of elevated water saturation. 6. Mechanical Condition: The Operator will demonstrate the mechanical integrity of the PCU #4 well according to the provisions of 20 AAC 25 .252( d) before initiating gas injection and storage operations. Well records indicate the Beluga 51-5 and Sterling 45-0 in the PCU #4 well are adequately protected by casing and cement. The Beluga 51-5 and Sterling 45-0 in the PCU #4 well are covered by 7 inch production casing, which was cemented with 106 barrels of 12 pound per gallon cement. The cement evaluation log (Ultrasonic Imager Cement Bond Log dated 11/04/01) indicated good bond from 6918-5900 feet MD. A formation leak off test at 6941 feet MD indicated leak off at 1465 psi and a 0.82 fracture gradient indicating the cement at the shoe of the 7" casing was sealing. A remedial circulation squeeze cement job was performed on the 7" casing through perforations from 5594 to 5596 feet MD. Drilling mud was circulated from the 7" by open hole and the 7" by 9-5/8" casing annuli. The remedial cement job consisted of 230 barrels of cement pumped through the perforations and circulated to surface with 12 barrels returned. The evaluation of the cementing operation indicated formation isolation. Further evidence of formation isolation is predicated on the volumetric depletion and pressure drop in each sandstone and lack of behind- pipe water movement. · . ) Storage InjectIOn Order Nu. Z. September 12, 2005 ) Page 4 The PCU #4 well has been completed to isolate the Sterling 45-0, Beluga 51-5 and Beluga 55-6 to prevent cross flow in the tubing. There are packers above and below the upper sandstones and sliding sleeves across from each interval to facilitate isolation. Unocal described water cross flow from the Sterling 45-0 to the Beluga 51-5 when the well was shut-in for mechanical problems. 7. Reservoir Fluids. Gas and Storage Gas Properties: The gas proposed for storage is predominantly methane produced from Middle Kenai Gas Pool in the McArthur River Field. The composition of this gas is 97.8% methane, 1.5% carbon dioxide 0.3% nitrogen and 0.4% other gaseous hydrocarbons (ethane, propane, butanes and C6+). The gas from the Pretty Creek undefined pool has 98.8% methane, 0.5% C02, 0.6% N2 and 0.1% miscellaneous hydrocarbons (ethane, C6+). Specific gravity of the injected gas is expected to be 0.57 (air = 1.0). Gas from other fields on the West side of Cook Inlet may also be stored in the PCGSF. Produced water from the Sterling 45-0 has approximately 22,500 parts per million Total Dissolved Solids ("TDS"). Water from the Beluga 51-5 has approximately 9,900 parts per million TDS. TDS are based on samples the Operator gathered and had analyzed. Both reservoir intervals are classified as hydrocarbon bearing and are not sources of drinking water. Unocal does not expect gas adsorption in adjacent coal beds to cause a significant problem for the PCGSF in the Sterling 45-0. Gas adsorption and desorption will occur according to the pressure being exerted by injection or the pressure differential exerted by depletion caused by production. 8. Injection Rate. Pressure and Fracture Gradients: Formation fracture gradients measured in shallower and deeper formations range from 0.99 psi to 0.82 psi per foot based on leak off tests performed at 2398 and 6954 feet MD respectively. Neither the Beluga nor Sterling Formations have had direct fracture gradient determinations. Calculated fracture gradients based on electric log-derived properties were 0.68 and 0.72 psi/ft for the Sterling 45-0 and between 0.77 and 0.79 psi/ft in the Beluga 51-5. Estimated maximum injection rate is 20 MMSCF/D, and expected average wellhead injection pressure is 1550 psig. The Operator proposes to limit the maximum pressure gradient while injecting gas to 0.65 psi/ft. This will limit maximum injection pressure to 2400 psi at the mid- point of Beluga 51-5 at 3686 feet TVD. The proposed maximum pressure and gradient are less than calculated fracture gradients of the Beluga 51-5 and Sterling 45-0. 9. Reservoir Surveillance: Unocal plans to monitor the reservoirs with material balance based on measured net gas in and out of the reservoir and reservoir pressure. Hysteresis effects between injection and production material balance data may alter straight-line P/Z analysis, but the technique is expected to verify volumetric balance within the storage reservoirs. Material balance surveillance of the Beluga 51-5 and Sterling 45-0 will enable the Operator to account for gas in and out of the reservoirs, monitor mechanical integrity, monitor confinement of the gas and provide a means to prevent waste. 10. Lateral Reservoir Confinement: TBO&G holds five leases immediately to the north and east of Pretty Creek Unit. TBO&G stated their support for gas storage projects in the Cook Inlet Area. TBO&G is concerned that operation of the PCGSF could impact their leases if gas were to migrate from the storage reservoir onto their leases and potentially create correlative rights and safety issues. Storage Injection Order NU.) September 12, 2005 ) Page 5 Maps provided by Unocal indicate the Beluga 51-5 and Sterling 45-0 reservoirs are confined within a small area of the PCU by the structure and stratigraphic features. This interpretation is based on data derived from drilling, electric logs, pressure tests, material balance, and production performance. CONCLUSIONS: 1. The project as described and proposed meets the requirements of20 AAC 25.252. 2. Mechanical integrity of the PCU #4 well will be demonstrated according to the requirements of20 AAC 25.252(d) prior to initiating gas injection and storage operations. 3. The proposed injection of natural gas into the PCU #4 well for the purpose of storage will not cause movement of hydrocarbons into sources of freshwater. 4. The proposed storage of natural gas in the reservoir beneath the PCU #4 well will not cause fluids to move behind casing beyond the approved storage zone. 5. The proposed storage of natural gas in well PCU #4 will not propagate fractures through the confining zones. 6. The proposed injection of natural gas into the PCU #4 well for the purpose of storage will not cause waste, jeopardize correlative rights, endanger freshwater, or impair ultimate recovery. 7. Surveillance of operating parameters on the storage well and offset wells will aid III preventing stored gas from moving out of the formation where it is intended to be stored. 8. Surveillance of reservoir pressure and volumes injected and produced will ensure conservation of natural gas, prevent waste and protect correlative rights. NOW, THEREFORE, IT IS ORDERED that the following rules, in addition to statewide requirements under 20 AAC 25, apply to the underground storage of hydrocarbons by injection in the PCU #4 well. RULE 1: STORAGE INJECTION The Commission approves the injection for storage of natural gas into the Beluga Formation 51-5 sandstone. After one year of injection storage and retrieval operations have been completed, the operator shall provide a written summary report and meet with the Commission to present its findings. At that time, the Commission will render a decision concerning storage injection operations in the Sterling Formation 45-0 sandstone within the PCU #4 well bore. The Operator shall report disposition of production and injection as required by 20 AAC 25.228, 20 AAC 25.230, and 20 AAC 25.235. RULE 2: ACQUISITION OF A GAS STORAGE LEASE The Commission's approval in Rule 1 is conditioned on the issuance and maintenance of a Gas Storage Lease from the Alaska Department of Natural Resources, Division of Oil and Gas, in accordance with AS 38.05 prior to beginning and throughout the duration of storage operations. RULE 3: DEMONSTRATION OF MECHANICAL INTEGRITY The mechanical integrity of the injection well must be demonstrated before injection begins, and before returning a well to service following a workover affecting mechanical integrity. A Storage Injection Order Nu. ) September 12, 2005 ) Page 6 Commission-witnessed mechanical integrity test must be performed after injection is commenced for the first time in the well, to be scheduled when injection conditions (temperature, pressure, rate, etc.) have stabilized. Subsequent tests must be performed at least once every four years thereafter (except at least once every two years in the case of a slurry injection well), The Commission shall be notified at least 24 hours in advance to enable a representative to witness mechanical integrity tests. Unless an alternate means is approved by the Commission, mechanical integrity must be demonstrated by a tubing/casing annulus pressure test using a surface pressure of 1500 psi or 0.25 psi/ft multiplied by the vertical depth of the packer, whichever is greater, that shows stabilizing pressure and does not change more than 10 percent during a 30-minute period. Results of mechanical integrity tests must be readily available for Commission inspection. RULE 4: WELL INTEGRITY FAILURE AND CONFINEMENT Whenever any pressure communication, leakage or lack of injection zone isolation is indicated by injection rates, operating pressure observations, tests, surveys, logs, or other evidence, the operator shall notify the Commission by the next business day and submit a plan of corrective action on a Form 10-403 for Commission approval. The operator shall immediately shut in the well if continued operation would be unsafe or would threaten contamination of freshwater, or if so directed by the Commission. A monthly report of daily tubing and casing annuli pressures and injection rates must be provided to the Commission for all injection wells and offsets within 1/2 mile indicating well integrity failure or lack of injection zone isolation. RULE 5: MAXIMUM INJECTION PRESSURE Maximum wellhead injection pressure shall be limited to 1900 psi or 20% over initial reservoir pressure or 2000 psi at 3686 feet TVD and a formation pressure gradient of 0.55 psi per foot. Upon satisfactory demonstration of confinement of the storage gas at elevated pressure by P/Z material balance, the Operator may apply to the Commission to increase the reservoir pressure for storage purposes. RULE 6: ANNUAL PERFORMANCE REPORT An annual report evaluating the performance of the storage injection operation must be provided to the Commission no later than 60 days after the beginning of each calendar year. The report shall include material balance calculations of the gas production and injection volumes to provide assurance of continued reservoir confinement of the gas storage volumes. RULE 7: EXPIRATION OF APPROVAL' As provided in 20 AAC 25.2520), if storage operations are not begun within 24 months after the date of this Order, the injection approval shall expire unless an application for extension has been approved by the Commission. ) Storage Injection Order Nu. 4 September 12, 2005 ) Page 7 RULE 8: ADMINISTRATIVE ACTIONS Unless notice and public hearing is otherwise required, the Commission may administratively waive or amend any rule stated above as long as the change does not promote waste or jeopardize correlative rights, is based on sound engineering and geoscience principles, and will not result in fluid moveme 0 side of the authorized injection zone. Daniel T.' amount, Jr. Commissioner ~%.~~~ Com;hissioner CTlJnc L Jo~ K. rman '-Ó;irman AS 31.05.080 provides that within 20 days after receipt of written notice of the entry of an order, a person affected by it may file with the Commission an application for rehearing. A request for rehearing must be received by 4:30 PM on the 23rd day following the date of the order, or next working day if a holiday or weekend, to be timely filed. The Commission shall grant or refuse 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 Commission, the 30-day period for appeal to Superior Court runs from the date on which the request is deemed denied (i.e., 10th day after the application for rehearing was filed). various Administrative Approvals and Storage lni.ection Orders ) ') Subject: Various Administrative Approvals and Storage Injection Orders From: Jody Colombie <jody _ colombie@admin.state.ak.us> Date: Tue, 13 Sep 2005 13:56:11 -0800 To: undisclosed~recipients:; Tarious Administrative Approvals and Storage Ini~ction Orders ) \ ) Administrative Approval AlO 10B.003 Administrative Approval AlO 14B.1 Administrati ve Approval AlO 5..005 Administrative Approval CO 477.006 Administrative Approval AlO 10B.002 Storage Injection Order #4 PBU. Schrader Bluff PBUNiakuk Trading Bay Unit Grßying 16 PBUSchrader Bluff PBQ ßchrader~luff Pretty Creek Ur¡Ü t#4 I· , , ,I" :,,,:,,,:,,,,,,,,,,,..::,,:,,,,:,,,,,,,:,,.:::,¡::,:,;,:,,,,,,"""'"..",:,""':""""''',:,:"....:..::,;'.; I Content- Type: applicationlpdf' I AI014B.001.pdf, . ' ....·.i .' . . .. ..' . ", '.Content-EncodIng: base64 ' ..1.... . , I Content-Type: applicationlpdf ,AIOI0B.003.pdf '. . . . Content-EncodIng: base64 I ' Content-Type: applicationlpdf I C04 77 .006. pdf ,I ' Content-Encoding: base64 Content-Type: applicationlpdf AIOIOB.002.pdf . Content-Encoding: base64 I ! Content-Type: applicationlpdf I ~SI04 pdf! I · : Content-Encoding: base64 Content-Type: applicationlpdf AI05.005.pdf . . Content-Encoding: base64 20f2 9/13/2005 1 :56 PM Citgo Petroleum Corporation PO Box 3758 Tulsa, OK 74136 Mona Dickens Tesoro Refining and Marketing Co. Supply & Distribution 300 Concord Plaza Drive San Antonio, TX 78216 Jerry Hodgden Hodgden Oil Company 408 18th Street Golden, CO 80401-2433 Kay Munger Munger Oil Information Service, Inc PO Box 45738 los Angeles, CA 90045-0738 Mark Wedman Halliburton 6900 Arctic Blvd. Anchorage, AK 99502 Ciri land Department PO Box 93330 Anchorage, AK 99503 Jill Schneider US Geological Survey 4200 University Dr. Anchorage, AK 99508 Darwin Waldsmith PO Box 39309 Ninilchick, AK 99639 Penny Vadla 399 West Riverview Avenue SOldotna, AK 99669-7714 Bernie Karl K&K Recycling Inc. PO Box 58055 Fairbanks, AK 99711 ') Mary Jones XTO Energy, Inc. Cartography 810 Houston Street, Ste 2000 Ft. Worth, TX 76102-6298 Robert Gravely 7681 South Kit Carson Drive Littleton, CO 80122 Richard Neahring NRG Associates President PO Box 1655 Colorado Springs, CO 80901 Samuel Van Vactor Economic Insight Inc. 3004 SW First Ave. Portland, OR 97201 Schlumberger Drilling and Measurements 2525 Gambell Street #400 Anchorage, AK 99503 Baker Oil Tools 4730 Business Park Blvd., #44 Anchorage, AK 99503 Gordon Severson 3201 Westmar Cr. Anchorage, AK 99508-4336 James Gibbs PO Box 1597 Soldotna, AK 99669 Richard Wagner PO Box 60868 Fairbanks, AK 99706 Williams Thomas Arctic Slope Regional Corporation land Department PO Box 129 Barrow, AK 99723 ) David McCaleb IHS Energy Group GEPS 5333 Westheimer, Ste 100 Houston, TX 77056 George Vaught, Jr. PO Box 13557 Denver, CO 80201-3557 John levorsen 200 North 3rd Street, #1202 Boise, 10 83702 Michael Parks Marple's Business Newsletter 117 West Mercer St, Ste 200 Seattle, WA 98119-3960 David Cusato 200 West 34th PMB 411 Anchorage, AK 99503 Ivan Gillian 9649 Musket Bell Cr.#5 Anchorage, AK 99507 Jack Hakkila PO Box 190083 Anchorage, AK 99519 Kenai National Wildlife Refuge Refuge Manager PO Box 2139 Soldotna, AK 99669-2139 Cliff Burglin PO Box 70131 Fairbanks, AK 99707 North Slope Borough PO Box 69 Barrow, AK 99723 . \\ª ~,~Cr) ~G\\? • • ~s ...~ ~.j i ~'~j i~.~+~ Z j d 3 P i ~ p ° ~° ! ~j~(1 ! ~~ ~ .. 3 ~ ~ l «- r ~ ~ ~ ~ ~ J ) SARAH PALIN, GOVERNOR E . . .:. ~ C1•ilt~-7~ OIIJ ~ ~ 333 W. 7th AVENUE, SUITE 100 C01~51RQATIOrT C011II1IIS51O1Q ANCHORAGE, ALASKA 99501-3539 PHONE (907) 279-1433 FAX (907) 276-7542 ADMINISTRATIVE APPROVAL SIO 4.001 Mr. Paul M. Winslow Chevron North America Exploration and Production P.O. Box 196247 Anchorage, AK 99519-6247 RE: Storage Injection into Sterling 45-0 Sand Dear Mr. Winslow: In accordance with Rules 1 and 8 of Storage Injection Order (SIO) 4.000, the Alaska Oil and Gas Conservation Commission (AOGCC or Commission) hereby grants Chevron North America Exploration and Production (Chevron)'s request for approval to commence storage injection into the Sterling 45-0 sand of the Pretty Creek Gas Storage Facility (PCGSF). Gas storage and retrieval using the Sterling 45-0 sand must be reauthorized on a yearly basis, until the Commission directs otherwise. Likewise, Chevron shall not commingle gas storage-retrieval operations in the Sterling 45-0 sand with the Beluga 51-5 sand until the Commission is satisfied that commingling will not promote waste. With an effective date of September 12, 2005, SIO 4 authorized Chevron to inject gas into Pretty Creek Unit (PCU) Well 4 for storage during periods of excess gas supply and to produce gas during periods of increased demand. Initial gas storage injection was restricted to the Beluga Formation 51-5 sand. Rule 1 of SIO 4 includes the provision for expanding, with Commission approval, storage injection into the Sterling Formation 45-0 sand after completing one year of storage injection and retrieval operations in PCU 4. To date, Chevron has successfully completed 2 gas injection-retrieval cycles in PCU 4. Information provided with the application for administrative approval, including gas material balance calculations and accompanying graphical analysis of the reservoir's performance indicate storage-retrieval operations are being conducted in a manner that assures the confinement of injected gas. Mechanical integrity and confinement have been demonstrated throughout the storage injection-retrieval operation. A passing mechanical integrity test of the tubing-casing annulus in PCU 4 was witnessed by a Commission Inspector on March 29, 2008. Monthly reports of wellhead pressures provided by Chevron as required by Rule 4 of SIO 4 show no anomalous conditions that would indicate the loss of well mechanical integrity. Reservoir performance data reported by Chevron indicate gas is confined to the injection interval. Chevron indicates that the Beluga 51-5 sand is rapidly approaching its individual storage capacity. Allowing gas injection into the Sterling 45-0 sand would significantly increase the SIO 4.001 • • August 21, 2008 Page 2 of 2 overall storage capacity for the PCGSF and will further enhance gas availability during peak demand periods. Findings in SIO 4 raise concerns about loss of injected gas due to water encroachment in the Sterling 45-0 sand should storage injection be allowed. The Commission believes operating the Sterling and Beluga sands independently for at least the first year's storage injection-retrieval cycle is a prudent action that allows Chevron to test the ability of the Sterling 45-0 sand to operate effectively and efficiently. Annual reauthorizations of the storage injection into the Sterling 45-0 sand will also provide the Commission, the oversight to assure there is no gas waste due to the potential problems associated with gas storage in water-saturated. sand. The Commission notes that PCU 4 is completed with separate sliding sleeves across the Sterling 45-0 sand and Beluga 51-5 sand to allow for the independent operation of the two sands. In correspondence dated August 1, 2008 Chevron clarified that the Sterling 45-0 and Beluga 51-5 sands would likely be isolated for the first and possibly second storage injection-retrieval cycles. Future commingling of the sands would be an option. The Commission believes the Sterling 45- 0 and Beluga 51-5 sands should be operated independently for at least the first and second injection-retrieval cycles, allowing the performance of the Sterling 45-0 sand to be assessed. Please note that this approval establishes a new storage injection pool named Pretty Sterling Gas Storage. DONE at Anchorage, Alaska and dated August Cathy . Foerster Commissioner Creek . `~`',r«~~,` . . d~ r-~ --, ., ~. ~~ , ;,:` ,;'T ~_ -~ 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 for good cause shown, a person affected by it may file with the Commission an application for reconsideration of the matter determined by it. If the notice was mailed, then the period of time shall be 23 days. An application for reconsideration must set out the respect in which the order or decision is believed to be erroneous. The 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 reconsideration are FINAL and may be appealed to superior court. The 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 denying reconsideration, UNLESS the denial is by inaction, in which case the appeal MUST be filed within 40 days after the date on which the application for reconsideration was filed. If the Commission grants an application for reconsideration, this order or decision does not become final. Rather, the order or decision on reconsideration will be the FINAL order or decision of the Commission, and it may be appealed to superior court. That appeal MUST be filed within 33 days aHer the date on which the Commission mails, OR 30 days if the Commission otherwise distributes, the order or decision on reconsideration. 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. Page 1 of 1 Colombie, Jody J (DOA) From: Colombie, Jody J (DOA) Sent: Friday, August 22, 2008 11:07 AM Subject: CO 228-001 MGS Cancellation and S104-001 Pretty Creek Attachments: co228-001 cancelled.pdf; sio4-001.pdf BCC:'Dale Hoffman'; Fridiric Grenier; Joseph Longo; 'Lamont Frazer'; 'Mary Aschoff ; Maurizio Grandi; P Bates; 'Scott Nash'; Tom Gennings; 'Willem Vollenbrock'; 'Aleutians East Borough'; 'Anna Raff ; Arion, Teri A (DNR); 'Arthur Copoulos'; 'Barbara F Fullmer'; 'bbritch'; 'Bill Walker'; 'Brad McKim'; 'Brandon Gagnon'; 'Brian Gillespie'; 'Brian Havelock'; 'Brit Lively'; 'Bruce Webb'; 'buonoje'; 'Cammy Taylor'; 'Cande.Brandow'; 'carol Smyth'; 'Cary Carrigan'; caunderwood@marathonoil.com; 'Charles O'Donnell'; 'Chris Gay'; 'Christian Gou-Leonhardt'; 'Cliff Posey'; 'Dan Bross'; 'dapa'; 'Daryl J. Kleppin'; 'David Brown'; 'David Hall'; David House; 'David L Boelens'; 'David Steingreaber'; 'ddonkel'; 'Deborah J. 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Rossberg'; 'tablerk'; 'Tamera Sheffield'; 'Temple Davidson'; 'Terrie Hubble'; 'Tim Lawlor'; 'Todd Durkee'; Tony Hopfinger; 'trmjrl'; 'Walter Featherly'; 'Walter Quay'; 'Wayne Rancier'; Birnbaum, Alan J (LAW); Crisp, John H (DOA); 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, C (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); Saltmarsh, Arthur C (DOA); Scheve, Charles M (DOA); Seamount, Dan T (DOA); Smith, Chasity R (DOA); Williamson, Mary J (DOA) Attachments:co228-001 cancelled.pdf;sio4-OOl.pdf; Jody J. Colombie Special Assistant to the Commission Alaska Oil and Gas Conservation Commission 333 West 7th Avenue, Suite 100 Anchorage, Alaska 99501 (907) 793-1221 Direct Line (907) 276-7542 Fax 8/22/2008 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 John Levorsen Mark Wedman Baker Oil Tools 200 North 3rd Street, #1202 Halliburton 4730 Business Park Blvd., #44 Boise, ID 83702 6900 Arctic Blvd. Anchorage, AK 99503 Anchorage, AK 99502 Schlumberger Ciri Ivan Gillian Drilling and Measurements Land Department 9649 Musket Bell Cr.#5 2525 Gambell Street #400 PO Box 93330 Anchorage, AK 99507 Anchorage, AK 99503 Anchorage, AK 99503 Jill Schneider Gordon Severson Jack Hakkila US Geological Survey 3201 Westmar Cr. PO Box 190083 4200 University Dr. Anchorage, AK 99508-4336 Anchorage, AK 99519 Anchorage, AK 99508 Darwin Waldsmith James Gibbs Kenai National Wildlife Refuge PO Box 39309 PO Box 1597 Refuge Manager Ninilchick, AK 99639 Soldotna, AK 99669 PO Box 2139 Soldotna, AK 99669-2139 Penny Vadla Richard Wagner Cliff Burglin 399 West Riverview Avenue PO Box 60868 PO Box 70131 Soldotna, AK 99669-7714 Fairbanks, AK 99706 Fairbanks, AK 99707 Bernie Karl North Slope Borough Williams Thomas K&K Recycling Inc. PO Box 69 Arctic Slope Regional Corporation PO Box 58055 Barrow, AK 99723 Land Department Fairbanks, AK 99711 PO Box 129 Barrow, AK 99723 ~~~ ~ ~,~~ • • s , Regg, James B (DOA) From: Larry Greenstein [Igreenstein @hilcorp.com] 5 q 1 Sent: Tuesday, May 08, 2012 1:18 PM To: Regg, James B (DOA); Schwartz, Guy L (DOA) Cc: Chet Starkel; Luke Saugier; Chris Kanyer; Neumann, Michael P (DNR) Subject: 2012 April's PCU #4 Storage Well Monitoring Report Attachments: Master Well List TIO Report 2012 05 01.xls Hi Jim & Guy, Here is April's monthly report for the wells requiring pressure monitoring for the PCU #4 storage reservoir. Not much action with the PCU #4 storage well this last month...did get some gas into the ground and there'll be much more of that occurring in the coming months. The pressures responded as expected to the short term injection events. The PCU #2 well was inactive this last month. Per the attached plots, there isn't any indication that the stored gas is not being contained in the approved storage area. v Larry e t Pressure & Rate vs Time - Well PCU 4� 1800 .... _..., ''....1‘.1,,,,.. 1600 , 10000 1400 Y 8000 • 1 53 1200 - - -- 133/8" /8 — Tubing — Vol Inj —Vol Prod 1000 • , E' 1 4 u. 7 ( 6000 Ili a §' 800 - L . 4000 600 • 400 n i - 2000 200 - 1 N N N N 8 O N N N co cl co M a n n O r Date 133/8“ ligirinj Vol Prod TIO Report 04/29/12 1 0 1441 0 0 04/28/12 1 0 1446 3510 0 Data Sheet 04/27/12 1 0 1440 0 0 04/26/12 1 0 1440 0 0 04/25/12 10 0 1440 1580 0 PCU 4 04/24/12 10 0 1438 0 0 04/23/12 1 0 1438 0 0 04/22/12 1 0 1438 0 0 STORAGE WELL 04/21/12 - 10 =- 0 1442 2070 0 04/20/12 1 0 1610 6280 0 04/19/12 1 0 1600 6370 0 Permit # 2011930 04/18/12 10 0 0 1590 1490 0 04/17/12 1 0 1416 0 0 04/16/12 i 0 1420 0 0 API # 50- 283 - 20100 -00 04/15/12 1 0 1419 0 0 04/14/12 1 0 1418 0 0 04/13/12 1 0 1418 0 0 10/31/2011 to 05/01/2012 04/12/12 10 0 1416 0 0 04/11/12 10 0 1416 0 0 04/10/12 j 10 0 0 1416 0 0 04/09/12 10 0 0 1417 0 0 04/08/12 10 0 0 1416 0 0 04/07/12 10 0 0 1416 0 0 04/06/12 10 0 0 1416 0 0 04/05/12 10 0 016 0 0 04/04/12 10 0 0 1414 0 0 04/03/12 10 0 0 1414 0 0 04/02/12 ! 10 0 0 1413 0 0 04/01/12 10 0 0 1412 0 0 03/31/12 10 0 0 1414 0 0 03/30/12 10 0 0 1412 0 0 03/29/12 1Q 0 0 1410 0 0 03/28/12 0 0 1410 0 0 03/27/12 0 1404 0 0 03/26/12 0 1400 03/25/12 0 1400 0 0 5/9/2012 2:15 PM - TIO Reports 7e.xls 11 Dolan Master Well List TIO Report 2012 05 01 PCU 4 Ot Pressure & Rate vs Time - Well PCU 2. • 1400 - 200 ______ 180 1200 ~�"""�'_ 160 ■....9 5/8" 133/8" 1000 ■20" —_ _______ m■Tubing 140 Vol 800 120 — V. 3 N LL 10 a 600 80 400 60 40 200 20 N 0 N N N p a N N co n m a i-i Date 13 3/8" 20" Tubing Vol TIO Report 04/29/12 0 0 1223 0 04/28/12 0 0 1222 0 Data Sheet 04/27/12 0 0 1220 0 04/26/12 0 0 1220 0 04/25/12 0 0 1220 0 PCU 2 04/24/12 0 0 1218 0 04/23/12 0 0 1220 0 04/22/12 0 0 1218 0 FLOWING _. 04/21/12 0 0 1218 0 04/20/12 0 0 1220 0 04 /19/12 0 0 1220 o Permit # 1790090 04/18/12 0 0 1219 0 04/17/12 0 0 1217 0 04/16/12 0 0 1217 o API # 50 283 - 20022 - 90 04/15/12 0 0 1218 0 04/14/12 0 0 1217 0 04/13/12 0 0 1216 0 10/31/2011 to 05/01/2012 04/12/12 0 0 1215 0 04/11/12 0 0 1215 0 04/10/12 0 0 1215 0 04/09/12 0 0 1216 0 04/08/12 0 0 1214 0 04/07/12 0 0 1213 0 04/06/12 0 0 1215 0 04/05/12 0 0 1214 0 04/04/12 0 0 1215 0 04/03/12 0 0 1215 0 04/02/12 0 0 1213 0 04/01/12 0 0 1216 0 03/31/12 0 0 1216 0 03/30/12 0 0 1217 0 03/29/12 0 0 1216 0 03/28/12 0 0 1216 0 03/27/12 0 0 1216 0 03/26/12 0 0 1215 0 03/25/12 0 0 1215 0 5/9/2012 2:16 PM - TIO Reports 7e.xls 11 Dolan Master Well List TIO Report 2012 05 01 PCU 2 • • ReOg, James B (DOA) 0 4 From: Larry Greenstein [Igreenstein©hilcorp.com] Sent: Monday, April 09, 2012 8:31 AM Pt A ( To: Regg, James B (DOA); Schwartz, Guy L (DOA) Cc: Chet Starkel; Luke Saugier; Chris Kanyer; Neumann, Michael P (DNR) Subject: 2012 March's PCU #4 Storage Well Monitoring Report Attachments: Master Well List TIO Report 2012 04 01.xis Hi Jim & Guy, Here is March's monthly report for the wells requiring pressure monitoring for the PCU #4 storage reservoir. Off and on, there was some pretty heavy production from the PCU #4 storage well this last month. No injection occurred this last month. The PCU #2 well was inactive this last month. ✓ Per the attached plots, there isn't any indication that the stored gas is not being contained in the approved storage area. Larry 1 • • Plot Pressure & Rate vs Time - Well PCU 4 2000 - - 1800 - - 10000 1600 OL-111. ' ■ 5/8" 13 3/8" 8000 1400 Tubing ......Vol Inj I •VOI Prod 1200 I it N Is) . LA 6000 1000 i ti 800 ^ f 4000 600 - 400 - i I 2000 1 200 I 0 1 �� 0 p N N N O M M M N N N O O t� (f O n 0 • Plot Pressure & Rate vs Time - Well PCU 2 1400 - �._.. , 200 180 �� moo........ ■►mot 1200 - �� -9 5/8" 160 13 3/8" ++ 20" 1000 erstsoTubing 140 Vol 3 120 800 N LL N N 10 a` 600 80 60 400 40 200 ■ 20 Q N N N , -,7 7-. ( Q p N N M a 0O o CJ • Regg, James B (DOA) From: Larry Greenstein [Ireenstein @hilcorp.com] Sent: Wednesday, March 07, 2012 2:38 PM t,i 3 617 i z To: Regg, James B (DOA); Schwartz, Guy L (DOA) Cc: Chet Starkel; Luke Saugier; Chris Kanyer; Neumann, Michael P (DNR) Subject: 2012 February's PCU #4 Storage Well Monitoring Report Attachments: Master Well List TIO Report 2012 03 01.xls Hi Jim & Guy, Here is February's monthly report for the wells requiring pressure monitoring for the PCU #4 storage reservoir. There was a little less gas demand from PCU #4 this month and we even got some gas back into the ground early in the month. The pressures at the wellhead responded as expected from the injection and production of gas during this time. The PCU #2 well was inactive this last month. Per the attached plots, there isn't any indication that the stored gas is not being contained in the approved storage area. Larry � 1 • • 5 4- 201 Z 3 1 7 1tz Plot Pressure & Rate vs Time - Well PCU 4 2000 1800 10000 N. 1600 ■9 5/8" 13 3/8" LI .011. 01.1i iv..., ...Tubing ■VOI Inj 8000 1400 i.VOIProd 1200 V i A\ '`IA . v - xv), • . 3 N 2 1000 u W L ■ a` 800 - 4000 600 ) - 400 2000 200 - I N N ` O N a `) n C1 O • • • 7 tl Plot Pressure & Rate vs Time - Well PCU 2 1400 - - 200 1200 _ 180 �1 5/8" 160 13 3/8" 1000 20" Tubing 140 Vol 800 120 U- v 10 a 600 • 80 400 60 40 200 20 0 c.4 N M M N 1` O e"! O \ r N CV � O O • • z_ Regg, James B (DOA) From: Larry Greenstein [Igreenstein@hilcorp.com] --� Gel Z� ?�� Sent: Monday, February 06, 2012 1:33 PM �� To: Regg, James B (DOA); Schwartz, Guy L (DOA) Cc: Chet Starkel; Luke Saugier; Chris Kanyer; Heumann, Michael P (DNR) Subject: 2012 January's PCU #4 Storage Well Monitoring Report Attachments: Master Well List TIO Report 2012 01 31.xis Hi Jim & Guy, Here is January's monthly report for the wells requiring pressure monitoring for the PCU #4 storage reservoir. There was lots of gas storage demand during the month of January and the well responded as expected. Almost no injection was possible due to the cold. The PCU #2 well was inactive again this last month. Per the attached plots, there isn't any indication that the stored gas is not being contained in the approved storage area. Larry 1 • • Plot Pressure & Rate vs Time - Well PCU 4 2000 - IIIIII 1800 10000 ft.s..j' Ir ‘iii.'....1/4'".e.i." 1 ..... 1600 -- - 7" —9 5 /8" 13 3/8" 8000 1400 Tubing 1 •Vol Inj I' , Vol Prod 1200 I) \. 6000 1000 v L 800 4000 600 t 400 2000 200 0 - 0 N o 8 o> 8 c n 1 co M N N N N N 0 0 0 0 • • Plot Pressure & Rate vs Time - Well PCU 2 1400 1200 - -9 5/8" 1000 13 3/8" •••■••• 20" Tubing 800 v N N 600 400 200 0 r - N O m m a0 W N N f` 00 O) 0 0 0 0 0 39 • • Chevron Kevin A. Tabler Chevron North America Manager, Land & Exploration and Production %OS Government Affairs 909 West 9 Avenue Mid Continent/Alaska P.O. Sox 196247 Anchorage, AK 99519 6247 7 Tel 907 263 7600 Fax 907 263 7698 Email tablerk @chevron.com VIA EMAIL AND U.S MAIL DELIVERY Email: wench =.wooiffit alaska.2ov April 01, 2011 Mr. Kevin Banks, Director Alaska Department of Natural Resources Division of Oil and Gas 550 West 7 Avenue, Suite 800 Anchorage, AK 99501 -3560 o t PRETTY CREEK STORAGE LEASE STATE OF ALASKA G , SEVENTH GAS STORAGE DEVEOPMENT PLAN J , 0 ADL #390776 Dear Mr. Banks: Pursuant to the provisions of Section 12 of the Pretty Creek Gas Storage Lease, Union Oil Company of California ( "Union "), as Unit Operator, submits the following Seventh (7 Storage Development Plan for your approval. I. PERIOD This plan shall cover the period from June 1, 2011 through May 31, 2012. 1I. FACILITY DESCRIPTION A. Sixth Plan Review No significant changes were made to the Pretty Creek storage facilities. B. Seventh Plan Proposed No changes to the Pretty Creek Storage facilities are anticipated for the Sixth Plan Period. MldContinent /Alaska /Chevron North America Exploration and Production www.chevron.com • • Mr. Kevin Banks, Acting Director 7 Gas Storage Development Plan April 01, 2011 Page 2 III. OPERATIONS A. Sixth Plan Review 1. Gas storage operations (including gas production) occurred in the PCU #4 well during the 6 plan period in accordance with gas supply and demand conditions. 2. As of March 31, 2011 the Beluga 51 -5 reservoir was depleted to an average reservoir pressure of 1,465 psi, based upon material balance. This pressure corresponds to a net gas extraction of 718 MMcf below the original gas in place in the 51 -5 sand reservoir. 3. The sliding sleeve across the Sterling 45-0 interval has been untouched throughout the time associated with the 6 plan period. The 45 -0 interval has remained closed, while Union has filled the Sterling 51 -5 reservoir above original reservoir pressure and volume, as allowed in the September 12, 2005 Storage Injection Order No. 4, Rule 5. B. Seventh Plan Proposed Union plans to conduct gas storage operations during the 7 plan period in accordance with gas supply and demand conditions. At this time, Union only plans to continue gas storage operations in the Beluga 51 -5 sand, vis -a -vis the PCU #4 well. IV. OPERATIONS PERFORMANCE MONITORING -r cfl�c�o� s •Pt. �� S A. Attached to this 7 Storage Development Plan is the "2010 Annual Performance Report ", which was submitted to the AOGCC on February 28, 2011, as required under Rule 6 of AOGCC Storage Injection Order No. 4. B. Union will continue to measure all gas injected into and withdrawn from the gas storage formation, and keep a record of all injections and withdrawals, as per the terms of the lease and the injection order. Flowing tubing pressures will be recorded on a daily basis. In addition, static tubing pressures and other pressure surveys will be conducted periodically to monitor the reservoir pressure and assess the storage well and reservoir performance. MidContinent /Alaska /Chevron North America Exploration and Production www.chevron.com • • Mr. Kevin Banks, Acting Director 7 Gas Storage Development Plan April 01, 2011 Page 3 V. PLANS FOR EXTRACTION /CONTRACTION A. Seventh Plan Union intends to continue to conduct storage operations in the Beluga 51 -5 reservoir, from the PCU #4 well. Future performance and gas supply /demand concerns may influence future expansion plans for the overall storage operation. B. Long -Term Plan Union plans to operate the PCGSF indefinitely to fulfill its annual and daily contract demands in accordance with the terms and conditions of the Gas Storage Lease. Union, as Storage Lease Operator, reserves the right to propose modifications to this Plan should conditions so warrant; however, no modifications will be made without first obtaining permission from the appropriate governmental agencies. Very truly yours, UNION OIL COMPANY OF CALIFORNIA By K n A. Tabler Manager, Land & Government Affairs APPROVED: ALASKA DEPARTMENT OF NATURAL RESOURCES Division of Oil and Gas This day of , 2010 By: cc: Chantal Walsh, CVX Dave Whitacre, CVX Kevin Eastham, CVX Daniel T. Seamount, AOGCC MidContinent /Alaska /Chevron North America Exploration and Production www.chevron.COm 8E. • • Page 1 of 1 Maunder, Thomas E (DOA) From: Walsh, Chantal [Petrotechnical Resources of Alaska (PRA)] [WalshC @chevron.com] Sent: Friday, March 04, 2011 3:54 PM To: Maunder, Thomas E (DOA) \—N Cc: Greenstein, Larry P Subject: New Pretty Creek #4 plot Attachments: Master Well List TIO Report 03 01.xls D-V E Tom, Please find attached the corrected PCU 4 gas storage Pressure and rate plot. As you can see, data was missing in the last report sent to you. The questions you raised earlier seem to steam from the missing data and I believe are no longer an issue. Please let me know if you have any further questions. At this time, all data looks good and indicates that the stored gas is being contained in the approved storage area. Chantal 263 -7627 3/7/2011 . . Plot Pressure & Rate vs Time - Well PCU 4 2000 - —,., 12000 1800 __. _ _— __._._. 141 \P 1600 - -- 10000 '9 5/8" 13 3/8" 1400 — •Tubing Vol Inj ""''" Vol Prod 8000 1200 w Iii w 1000 6000 a. 800 „r ^ ✓ V 1 ".%" ‘N.^ 4000 600 - 400 .. — 2000 200 0 „r 0 o _0 0 0 0 0 o m N N r M ro M N CV W O N O Q O Date 13 3/8" Tubing of TIO Report 03/01 /11 0 620 8 \-"C4„�� S� 02/28/11 7 111 0 0 630 0 7768 Data Sheet 02/27/11 0 0 640 0 8029 02/26/11 1 15 0 0 634 0 8180 02/25/11 i 15 0 0 636 0 8195 PCU 4 02/24/11 i 15 0 0 648 0 8274 02/23/11 i 15 0 0 648 0 8325 02/22/11 I 15 0 0 668 0 8300 STORAGE WELL 02/21/11 I, 15 0 0 672 0 8364 02/20/11 i 15 0 0 673 0 8482 02/19/11 I` 15 0 0 670 0 8468 Permit # 2011930 02/18/11 15 0 0 683 0 8518 02/17/11 15 0 0 690 0 8685 02/16/11 i 15 0 0 691 0 8653 API # 50- 283 - 20100 -00 02/15/11 02/14/11 1 15 0 0 697 0 8767 02/13/11 1; 15 0 0 693 0 8749 08/31/2010 to 03/01/2011 02/12/11 1 15 0 0 702 0 8884 02/11/11 15 0 0 699 0 8847 02/10/11 15 0 0 704 0 8916 02/09/11 l 15 0 0 703 0 8942 02/08/11 1 15 0 0 712 0 8945 02/07/11 15 0 0 707 0 9007 02/06/11 15 0 0 706 0 9139 02/05/11 ! 15 0 0 709 0 9228 02/04/11 15 0 0 712 0 9211 02/03/11 15 0 0 712 0 9267 02/02/11 15 0 0 719 0 9291 02/01/11 :: 15 0 0 724 0 9353 01/31/11 15 0 0 724 0 9458 01/30/11 15 0 0 724 0 9479 01/29/11 15 0 0 726 0 9494 01/28/11 - 15 0 724 0 9608 01/27/11 15 0 726 0 9658 01/26/11 i 15 0 727 0 9586 01/25/11 1 15 0 744 0 9717 3/7/2011 10:11 AM - TIO Reports 7e.xls J J Dolan Master Well List TIO Report 03 01 .xIs PCU 4 2011 February's PCU #4 Storage WeMonitoring Report Page 1 of 2 • Maunder, Thomas E (DOA) From: Greenstein, Larry P [Greensteinlp @chevron.com] Sent: Friday, March 04, 2011 11:10 AM To: Maunder, Thomas E (DOA) Subject: RE: 2011 February's PCU #4 Storage Well Monitoring Report Tom, You'll get a full report from Chantal on this issue, but let me first apologize for something I should have caught. All your questions will be answered once the plot gets the rest of the data plotted. Turns out one of the operators wasn't entering the production volume correctly in the system, so the plot couldn't 'see' what PCU #4 made that day (notice how '2 & 2' the data gaps look). I should have seen this pattern myself looking and investigated before sending this to you. We are correcting the data entry errors and will resend this plot when we get this done. It will look a lot better when we do. Sony about this. Larry From: Maunder, Thomas E (DOA) [mailto:tom.maunder @alaska.gov] Sent: Friday, March 04, 2011 9:52 AM To: Greenstein, Larry P Subject: RE: 2011 February's PCU #4 Storage Well Monitoring Report Thanks Larry. I was wondering if you could have Chantal or Gary take a look at these questions. 1. I am curious of the pressure response during the 3 most recent SI periods. Starting with the most recent, the pressure continues to decline at roughly the same rate as during the production periods either side while there is "chatter" in the pressure response during the prior 2 SI periods. Can you comment on the differences? 2. The relative pressure values seem to be "lower" beginning with the 3rd most recent SI period than previously. There seems to be a "step change" down in the pressure. Was an instrument changed? 3. During the 3rd most recent production period there is a sharp pressure increase when the rate is reduced from 10+ MM /day to -7 MM /day. Is that just a transient caused by the rate change? Thanks in advance. Tom Maunder, PE AOGCC From: Greenstein, Larry P [mailto :Greensteinlp @chevron.com] Sent: Thursday, March 03, 2011 4:55 PM To: Maunder, Thomas E (DOA); Regg, James B (DOA) Cc: Walsh, Chantal [Petrotechnical Resources of Alaska (PRA)]; Ross, Gary D Subject: 2011 February's PCU #4 Storage Well Monitoring Report Hi Tom & Jim, Here is February's monthly report for the wells requiring pressure monitoring for the PCU #4 storage reservoir. The use of the PCU #4 well has continued as the cold weather dictates and the pressures have declined as expected. 3/7/2011 2011 February's PCU #4 Storage W,Monitoring Report • Page 2 of 2 Nothing going on with PCU #2 this last month, its pressures remain stable. Per the attached plots, I don't see any indication that the stored gas is not being contained in the approved storage area. Larry «Master Well List TIO Report 2011 03 01.xis» 3/7/2011 Plot Pressure & Rate vs Time - Well PCU 4 2000 A r 12000 1800 ,n 1600 V '. 10000 '•""''9 5/8 1400 _ - 13 3/8" Tubing 8000 Vol I nj 1200 — Vol Prod d 3 LL u v 1000. __ 6000 L d "\l‘nriA"%.........,. , 800 - - -- - -- . __. - - -- — - .:::i __ - �. 400 - - --- __ ____ __ -- - -- -- _ __ - -- -- .-- ._ —_ - 2000 200 _ ...- - -- - - - -- _ -- - -- --. _ — . -- - - -- -- - - - -_ .— - - - - - -- 0 0 0 0 0 N N N co N " N c0 cn O N N O O _ O O Date '7" . 13 3/8" u ng Vol Irr Vol Prod TIO Report 02/27/11 15 0 0 640 0 8029 80 02/26/11 « A Sihj \ Data Sheet 15 0 0 634 0 8180 02/25/11 15 0 0 636 0 02/24/11 15 0 0 648 0 02/23/11 15 0 0 648 0 PCU 4 02/22/11 15 0 0 668 0 02/21/11 15 0 0 672 0 02/20/11 15 0 673 o STORAGE WELL 02/19/11 15 0 670 0 0 02/18/11 15 0 683 0 0 02/17/11 - 15 ' 0 690 0 0 Permit # 2011930 02/16/11 -� 0 691 0 0 02/15/11 02/14/11 15 ; ,,- 0 697 0 0 API # 50- 283 - 20100 -00 02/13/11 15 ' °, 0 693 0 0 02/12/11 15 0 702 0 0 02/11/11 15 .. 0 699 0 0 08/30/2010 to 03/01 /2011 02/10/11 15 , 0 704 0 0 02/09/11 -15 ' ` .<- 0 703 0 0 02/08/11 15 0 712 0 0 02/07/11 15 0 707 0 0 02/06/11 15 . -: 0 706 0 9139 02/05/11 15 `` 0 709 0 9228 02/04/11 15 0 712 0 9211 02/03/11 15 ..- 0 712 0 9267 02/02/11 15" � 0 ' 719 0 9291 . 02/01/11 15 0 724 0 9353 01/31/11 15 0 724 0 9458 01/30/11 - 15 -- 0 724 0 9479 01/29/11 15:' 0 726 0 9494 01/28/11 15': 0 724 0 9608 01/27/11 15' 0 726 0 9658 01/26/11 15 0 727 0 9586 01/25/11 15 0 744 0 9717_ 01/24/11 15 0 744 0 9606 01/23/11 15 0 743 0 0 3/7/2011 10:14 AM - TIO Reports 7e.xls J J Dolan Master Well List TIO Report 2011 03 01 (4).xls PCU 4 ~~ • • Page 1 of 2 Regg, James B (DOA) From: Regg, James B (DOA) ~.~ C ~(Z~~~ Sent: Wednesday, April 28, 2010 2:59 PM /-~~'--~"'~(~~, To: 'dennis.hinnah@dot.gov' Cc: Aubert, Winton G (DOA) Subject: RE: Gas Storage Jurisdictional Question I referenced the wrong Swanson River storage injection order; it should have read SIO 6, not SIO 3 Jim Regg AOGCC 333 W.7th Avenue, Suite 100 Anchorage, AK 99501 907-793-1236 _. _ _ __ _ _ From: Regg, James B (DOA) Sent: Wednesday, April 28, 2010 2:42 PM To: 'dennis.hinnah@dot.gov' Cc: Aubert, Winton G (DOA) Subject: RE: Gas Storage Jurisdictional Question Dennis - Winton and I discussed your request; I also checked with our Stat Tech who handles Monthly Facility Gas Disposition reports. AOGCC does not know the exact source of the gas that goes into storage unless the operator chooses to offer the information as part of one of its required reporting obligations. The operator's application for storage injection is required to identify the injected fluids (source) per 20 AAC 25.252(c)(7) which most often includes provisions for accepting gas from other unnamed sources that have gas compatible with the storage zone formation fluids. For the fields you name, the operator lists the following likely gas sources: SIO 3 -Swanson; application says source of gas will be from Swanson River Field initially and from other Cook Inlet fields in the future; SIO 4 -Pretty Creek; application says source of gas will be from excess Union-owned gas likely from Steelhead platform (McArthur River Field; Trading Bay Unit) and could also be sourced from Beluga River field or other west side properties operated by other operators; SIO 7A -Kenai; application says source of gas will be Kenai and Cannery Loop or sources deemed compatible with Sterling Pool 6; SIO 8 - Nicolai Creek; application says source of gas is "not presently determinable"; could come from other Aurora operated fields or purchased from another producer or utility. We checked the annual gas storage performance reports required by injection order rule; these focus on volume injected/produced and ongoing integrity of reservoir/wellbore without identifying the source. Our Storage Injection Order files include copies of the Storage Development Plans field with DNR; those include references to source(s) of gas for the gas storage project. For example, the DNR Storage Development Plan for Kenai Unit indicates gas from only Kenai Unit and Cannery Loop Unit has been injected to date. Because of the Commission's regulatory focus (reservoir and well performance/integrity perspectives) and lack of jurisdication beyond the point of custody transfer, we do not have information on pipeline(s) used to transfer the gas to storage injection well. We also do not have information about any processing facilities between a production well and storage injection well. Regarding inspections, our focus is the wellhead safety valve system, wellbore integrity and custody transfer measurement; we do not perform safety inspections at storage facilities. I think you are going to find there is more likely to be a regulatory gap than there would be regulatory overlap regarding surface facilities servicing gas storage operations. Sounds like your best bet is to obtain information about the source of gas from the operators. 4/28/2010 Page 2 of 2 Jim Regg AOGCC 333 W.7th Avenue, Suite 100 Anchorage, AK 99501 907-793-1236 From: dennis.hinnah@dot.gov [mailto:dennis.hinnah@dot.gov] Sent: Wednesday, April 28, 2010 11:40 AM To: Aubert, Winton G (DOA); Regg, James B (DOA) Subject: Gas Storage Jurisdictional Question Hi Winton/Jlm, I am trying to figure out a jurisdictional question related to the gas storage fields in Alaska and I am hoping you can help me. As I understand it, these are the four gas storage fields: Swanson River Field, operated by operated by Union Oil Company of California (SIO 3) Pretty Creek Gas Storage Facility, operated by Union Oil Company of California (SIO 4) Kenai Gas Field, operated by Marathon Oil Company (SIO 6) Nicolai Creek Field, operated by Aurora Gas, L.LC (SIO 8) PHMSA has jurisdiction in gas storage fields for surface piping, compression, etc. where the source of the gas is from a pipeline regulated by PHMSA. It is not clear what our jurisdiction is if the gas is moved between wells in the same field to get it to a well with higher deliverability or different reservoirs in the same field. There are probably other scenarios that I haven't thought of. I reviewed the Storage Injection Orders and wasn't able to find what I need. For each Storage Injection I would like to know the source of the stored gas, the pipeline(s) it travels through, and any processing facilities between the production well(s) and injection well(s). I included Jim on this email, because I would also like to know the extent of the safety inspections that the AOGCC does at the storage facilities. I don't see much jurisdictional overlap but things such as a pressure relief device that protects both the well and the pipeline or a common cathodic protection system would probably be jurisdictional to both agencies. Some of this could involve DNR or BLM jurisdiction, but so far I haven't seen anything leading me in that direction. I would be happy to discuss this further or if you would like to meet please let me know. Thanks, Dennis Dennis Hinnah, P.E. Deputy Director, Western Region U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration Phone: 907-271-4937 4/28/2010 -~.~~ 2009 August's PCU #4 Storage W~Monitoring Report . Page 1 of 1 Regg, James B (DOA) ~~ ~ ~ From: Greenstein, Larry P [Greensteinlp@chevron.com] Sent: Tuesday, September 15, 2009 11:34 AM ~ ~~~ f ~~~/~~~ To: Maunder, Thomas E (DOA); Regg, James B (DOA) Cc: Walsh, Chantal [Petrotechnical Resources of Alaska (PRA)]; Winslow, Paul M; Ross, Gary D Subject: 2009 August's PCU #4 Storage Well Monitoring Report Attachments: Master Well List TIO Report 2009 09 01.x1s Hi Tom & Jim, Here is August's monthly report for the wells requiring pressure monitoring for the PCU #4 storage reservoir. Injection has stopped on PCU #4 as the reservoir is full. Per the attached plots, I don't see any indication that any stored gas is not being contained in the approved storage area. Larry «Master Well List TIO Report 2009 09 01.x1s» 9/16/2009 Plot Pressure & Rate vs Time -Well PCU 2 1000 __ _ . - ~.-__ : ~.:, ~; 200 900 ----_ -- ------- __-.. - --- --- --- ~_ _ _ -____ --._. -----~ ` _ ...------ _:. 180 800 _ _- -- 160 _ 700 _ ~9 5/8~~ _ _ _ _ - -_ - - 140 13 3/8" - . _. 20° 600 - -- - - - Tubing _._. ------ ..__.._...- --- - ... _ . _.._-_ -----~ ~_. -~----------------- _-- ------ _;--- - --_ __-- - ~ 120 a~ ~Vol3 ' L 3 , . F LL u v 500 -__-...._. - - __._. -- 1 ~ a 400 _ - _ _- - - _ .. - --- - - _ _ - _ 80 300 - d 60 200 - -- -- - _- _ - - --- - - 1 4 0 100 - - _ _ _ _ - 20 ' ' 0 0 _ _ _ rn 0 rn rn rn rn 0 0 0 0 rn 0 rn 0 ~y O O O O M M O M ~ N ch ~ ~ i[> CO t` N a 11 i 2009 July's PCU #4 Storage Wel~onitoring Report • Page 1 of 1 Regg, James B (DOA) From: Greenstein, Larry P [Greensteinlp@chevron.com] Sent: Tuesday, August 11, 2009 8:55 AM ~~~ ~~~ To: Maunder, Thomas E (DOA); Regg, James B (DOA) ~Q~~ Cc: Walsh, Chantal [Petrotechnical Resources of Alaska (PRA)]; Winslow, Paul M; Ross, Gary D Subject: 2009 July's PCU #4 Storage Well Monitoring Report Attachments: Master Well List TIO Report 2009 08 01.x1s Hi Tom & Jim, Here is June's monthly report for the wells requiring pressure monitoring for the PCU #4 storage reservoir. / PCU #4 storage is practically full. The pressures have built as expected. ~ PCU #2 has been able to maintain its low production rate. °' Per the attached plots, I don't see any indication that any stored gas is not being contained in the approved storage area. Larry «Master Well List TIO Report 2009 08 01.x1s» 8/11/2009 Plot Pressure & Rate vs Time -Well PCU 4 1800 - _ _ _ 800 1600 _ - -- _ - _ -- _ -_ - - 700 1400 -_ _-_- - - _ -- - _ - ~ 600 1200 _ - ~~'~`"'~~~ ~C ~t ~ n, ~, ~ ~ '~~ ~ ~ 500 L~ ~ 1000 ---_ _-_ -_ _ - -- - _ - - - - 3 ~ 7 ~ ~ J N 4~ a 800 ~ ~9 5/8" 1 - ( -- V s ~ 13 3/8" ~ c~~' V'`~K` ~~, e 300 600 _- Tubing ~ i ~ _ _ - ~Vollnj ~ ~~lt~~~~,lit ~ 200 400 -- --_-__ --- - -- ~ Vol Prod _ _-._ _ 200 V~~k~~ _. - __ _ 100 ^"~.i.t(FL%~ ! -7 u L/ 0 0 o O O o 0 p (~ O O O M M M ~ N_ ~ N M M V ~ ~ ~ • • Plot Pressure & Rate vs Time -Well PCU 2 20 1000 _. _ _ _ 900 - - -_ _ _ _ - _ 18 800 _ _ _- __ ____ _ - 16 ~9 5/8 700 - ~ ~ u~~ 14 13 3/8" ' 600 ~.h 20., ---.._.-----------____.~_ ------ ----.--------- -- --..------- --- ------- --__._ 12 ' ~ Tubing 3 N J N V1 _____-- ___. - ~, 500 ----- ~Vol3 - --- -- --._^ a t___.~____._-- 400 ~ _ 80 v~~l4,c,-~~ 300 60 200 _ - _ _ - -_ _ - - - _ - 40 100 20 rn 0 rn 0 rn rn rn 0 0 0 rn 0 rn 0 0 M O 0 o M M M rn N rn N M M ~ ~ CO t~ r 2009 June's PCU #4 Storage We~onitoring Report ~ Page 1 of 1 Regg, James B (DOA) From: Greenstein, Larry P [Greensteinlp@chevron.com] Sent: Friday, July 10, 2009 4:04 PM '~j ~~~ ~ t' To: Maunder, Thomas E (DOA); Regg, James B (DOA) ~~ Cc: Walsh, Chantal [Petrotechnical Resources of Alaska (PRA)]; Winslow, Paul M; Ross, Gary D Subject: 2009 June's PCU #4 Storage Well Monitoring Report Attachments: Master Well List TIO Report 2009 07 01-GIL2.xls Hi Tom & Jim, Here is June's monthly report for the wells requiring pressure monitoring for the PCU #4 storage reservoir. '~ PCU #4 is continuing to inject gas back into the reservoir. The pressures have been building as expected. PCU #2 is maintaining its small production rate. Per the attached plots, I don't see any indication that any stored gas is not being contained in the approved storage area. 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N .P O W O _ ~ O O O O Pressure N A O O O N ~ O O O O O O O O O O 11 /29/08 12/02/08 12/05/08 ~ 12/08/08 , x 12/11/08 12/14/08 12/17/08 12/20/08 ~.~~...- .~, 12/23/08 12/26/08 12/29/08 1 /01 /09 1 /04/09 ~ 1 /07/09 c w ~ 1/10/09 ~ ~ o0 1 /13/09 ~ ~ ~ ~ ~ 1 /16/09 _ ~ 1 /19/09 ~ 1 /22/09 _ ~ ~ 1 /25/09 ~ 1 /28/09 CD 1 /31 /09 v' 2/03/09 ` ~ 2/06/09 ~ 2/09/09 2/12/09 n .,. ~. ~ QO 2/15/09 ~2 ~ , ~.- ' • . .,k,.: ~. ~-.._~: _ -~:.... . .;, ~ . 2/18/09 /~ 2/21 /09 ~ 2/24/09 ~ ~ 2/27/09 ~ e 3/02/09 r in 3/05/09 w°° y 3/08/09 ~• 3/11/09 ; 3/14/09. [ ~p 3/17/09 ~ ~ 3/20/09 x 3/23/09 3/26/09 ~ 3/29/09 ~ 4/01109. ~ b 4/04/09 ~ ('~ 4/07/09 ~I 4/10/09 4/13/09 ~ ~ 4/ 16/09 4/ 19/09 4/22/09 4/25/09 `y 4/28/09 5/01 /09 5/04/09 5/07/09 5/10/09 5/13/09 5/16/09 5/19/09 5/22/09 5/25/09 5/28/09 5/31 /09 O N W ? (T 67 ~I W S o o ~ te S o 0 0 • _~ -~~~` N .~ -v`y C ~~ ~~ 0 Pressure _ N W A ~ O v O O O O O O O O O O O O O O O O O O O O O O O O 11 /29/08 12/02/08 12/05/08 12/08/08 12/11/08 12/14/08 ~ I I 12/17/08 ~ 12/20/08 0 ~ o_ w ~, 12/23/08 °o w\ 12/26/08 o - ' ~ o 12/29/08 1 /01 /09 1 /04/09 1 /07/09 1/10/09 , 1 /13/09 ~ 1 /16/09 """ ~ 1 /19/09 , .r 1 /22/09 ~ 1 /25/09 -~ 1 /28/09 CD 1 /31109 ° 4r~ ~ 2/03/09 C 2/06/09 ~ 2/09/09 2/12/09 Qo 2/15/09 2/18/09 2/21 /09 ~ 2/24/09 rD 2/27/09 C 3/02/09 ~ ~ 3/05/09 ? ~..~ 3/08/09 ~ ~• 3/11/09 '~ 3/14/09 ~ 3/17/09 ~ 3/20/09 3/23/09 ~ ,~ 3/26/09 ~ y~ ,~ 3/29/09 ~ r.r 4/01 /09 ~ 4/04/09 4/07/09 ' 4/10/09 N 4113/09 4/16/09 4/ 19/09 4/22/09 4/25/09 4/28/09 5/01 /09 # 5/04/09 ~ 5/07/09 ., 5/10/09. 5/13/09 '~ 5/16/09 5/19/09 5/22/09 5/25/09 ' 5/28/09 5/31 /09 O O O O O R SJF~ N ? O W O bb~~ O O O O O • 'v ~~~ ~- 2009 April's PCU #4 Storage W~Monitoring Report ~ Page 1 of 1 Regg, James B (DOA) From: Greenstein, Larry P [Greensteinlp@chevron.com] Sent: Wednesday, May 06, 2009 8:37 AM To: Maunder, Thomas E (DOA); Regg, James B (DOA) ~~ ~(2~0 Cc: Orr, Gary A.; Winslow, Paul M; Ross, Gary D Subject: 2009 April's PCU #4 Storage Well Monitoring Report Attachments: Master Well List TIO Report 2009 04 30.x1s Hi Tom & Jim, Here is April's monthly report for the wells requiring pressure monitoring for the PCU #4 storage reservoir Again, a little flow from PCU #2 this last month, but trouble keeping it online. PCU #4 was tested in the upper zone, after sliding the sleeve. This shows upon the plot as a large tubing pressure drop. As this was unsuccessful, the sleeve was shifted back and the well is now taking storage gas back into the primary storage reservoir. This injection will show up on the plot for next mon s report. Per the attached plots, I don't see any indication that any stored gas is not being contained in the approved storage area. Larry «Master Well List TIO Report 2009 04 30.x1s» 5/6/2009 Pressure _ N A O OD O N A 67 O O O O O O O O O O O O O O O O O 10/30/08 11 /02/08 11 /05/08 11 /08/08 11/11/08 11 /14/08 11/17/08 .. , , ~..., . . ,._ ,: ,~ .= 11 /20/08 _ . ~K ..,:. 11 /23/08 11 /26/08 11 /29/08 12/02/08 ' , ~~~ ~' 12/05/08 : ~ ' 12/08/08 12/11 /08 12/ 14/08 ~ 12/17/08 "~ 12/20/08 v . .., ~ 12/23/08 ~ 12/26/08 ~ 12/29/08 , ~ 1/01/09 - ~ 1 /04/09 ~ I I I ~ I, 1 /07/09 ~ ' ~ 1/10/09 < < ~ ~ ~ ~ A 1/13/09 ~ _ ~ 1 / 16!09 ~ ° ~ 1/19/09 ~ ~ 1 /22/09 1 /25/09 _ - - -- CC 1 /28/09 ~ 1 /31 /09 2/03/09 ~ ~] 2/06/09 '~ ~'• 2/09/09 ! 2/12/09 y ~. ~... , ~ 2/15/09 , .<. ~..~.~~- 2/18/09 + ~ I~ 2/21 /09 2/24/09 C 2/27/09 3/02/09 ~ 3/05/09 3/08/09 C~ 3/ 11 /09 ~ 3/ 14/09 3/ 17/09 3/20/09 3/23/09 3/26/09 3/29/09 4/01 /09 4/04/09 'i 4/07/09 4/10/09 4/13/09 4/16/09 4/19/09 4/22/09 4/25/09 4/28/09 O N W A CTi O v C O O O O O O O O R:atO~ O O O .~ O tt~~ O O O • • Pres sure O N O W O A O C O P O O v O 00 O O O _ O O O O O O O O O O O O O 10/30/08 11 /02/08 11 /05/08 11 /08/08 11/11/08 r y 11 /14/08 11/17/08 i 11 /20/08 0 ~ o w ~ ~~ 11/23/08 W ~ w 11 /26/08 cn °' _ 11 /29/08 - _ 12/02/08 12/05/08 12/08/08 12/11/08 12/14/08 b 12/17/08 C 12/20/08 ~ 12/23/08 ~ ~ 12/26/08 '~ 12/29/08 ~ 1 /01 /09 ~ 1 /04/09 ~ 1 /07/09 ~ ~ 1 /10/09 1 /13/09 1 /16/09 -~ 1 / 19/09 ~ 1 /22/09 1 /25/09 ~ 1 /28/09 ~ 1 /31 /09 2/03/09 ~"~ 2/06/09 ~~ 2/09/09 CD 2/12/09 2/15/09 ~ 2/18/09 2/21 /09 ~p 2/24/09 ~ 2/27/09 ~ 3/02/09 3/05/09 3/08/09 3/11 /09 r N 3/14/09 3/17/09 03/20/09 3/23/09 3/26/09 3/29/09 4/01 /09 4/04/09 4/07/09 4/10/09 4/13/09 "~' 4/16/09 4/19/09 4/22/09 4/25/09 4/28/09 O N A O O R ~e N ~ O N O O O O O O • 2009 April's PCU #4 Storage ~l Monitoring Report • Page 1 of 2 From: Winslow, Paul M Sent: Monday, May 11, 2009 3:56 PM To: 'Maunder, Thomas E (DOA)' Cc: Walsh, Chantal [Petrotechnical Resources of Alaska (PRA)); Greenstein, Larry P; Regg, James B (DOA) Subject: RE: 2009 April's PCU #4 Storage Well Monitoring Report Tom, Here is a summary of the testing that was recent conducted on the PCU #4 well. Note that the Beluga 51-5 and Sterling 45-0 zones were tested independently. 4/7/09 - With the middle sliding sleeve open (Beluga 51-5 reservoir), the well had a shut in tubing pressure of -1200 psi. Slick line rigged up on the well, closed the middle sleeve, and then negative tested the tubing to confirm that the tubing was isolated. The SITP was bled down from 1200 psi to 1000 psi. The upper sliding sleeve (Sterling 45-0 reservoir) was then opened and the tubing pressure increased to 1120 psi. 4/8/09 - A pressure/temp survey was run. Pressure at Sterling 45-0 interval (top sliding sleeve) was --1205 psi. The last pressure survey on this zone showed the reservoir pressure to be -1050 psi (05/04). 4/16/09 - The well was opened to production, from the Sterling 45-0 reservoir. After producing a very small volume of gas (~20 Mcf), the well died within minutes. The well appears to have loaded up with water from the 45-0 interval. The well was left shut-in with the upper sliding sleeve open. 5/2/09 - Rigged up slickline. Fluid level was taken at 2000'. The tubing was pressured up to push fluid back into the Sterling 45-0 interval. We shot a fluid level confirming that the fluid level (at 4444') was about at the upper Sterling 45-0 perfs. RIH and shut sliding sleeve across the Sterling 45-0 sand. Negative tested the tubing and confirmed that all sleeves were closed. We then opened the sliding sleeve across the middle, Beluga 51-5, zone. The well was then turned over to production (from the Beluga 51-5 interval), and blown dry. We are currently evaluating the results of the test on the Sterling 45-0 interval, to decide if the interval has future utility for gas storage. In the meantime, we have begun to re-fill the Beluga 51-5 reservoir. Please contact me if you have any questions. Paul Paul Winslow Chevron North American Exploration 8~ Production MidContinent /Alaska Business Unit 3800 Centerpoint Dr., Suite 100, Anchorage, AK 99503 Tel: 907-263-7629 Cell: 907-382-3813 Fax 907-263-7828 pwinslo_w_ a~c_h_evron_com From: Maunder, Thomas E (DOA) [mailto:tom.maunder@alaska.govJ Sent: Wednesday, May 06, 2009 9:54 AM file://C:\Users\snlg\AppData\Local\Temp\RE 2009 April's PCU #4 Storage Well Monitori... 7/28/2009 2009 April's PCU #4 Storage ~l Monitoring Report • Page 2 of 2 To: Greenstein, Larry P Cc: Orr, Gary A.; Winslow, Paul M; Ross, Gary D; Regg, James B (DOA) Subject: RE: 2009 April's PCU #4 Storage Well Monitoring Report Larry, et al, Willa 404 covering the "testing" of the upper zone be filed? Thanks, Tom Maunder, PE AOGCC From: Greenstein, Larry P [mailto:Greensteinlp@chevron.com) Sent: Wednesday, May 06, 2009 8:37 AM To: Maunder, Thomas E (DOA); Regg, James B (DOA) Cc: Orr, Gary A.; Winslow, Paul M; Ross, Gary D Subject: 2009 April's PCU #4 Storage Well Monitoring Report Hi Tom & Jim, Here is April's monthly report for the wells requiring pressure monitoring for the PCU #4 storage reservoir. Again, a little flow from PCU #2 this last month, but trouble keeping it online. PCU #4 was tested in the upper zone, after sliding the sleeve. This shows up on the plot as a large tubing pressure drop. As this was unsuccessful, the sleeve was shifted back and the well is now taking storage gas back into the primary storage reservoir. This injection will show up on the plot for next month's report. Per the attached plots, I don't see any indication that any stored gas is not being contained in the approved storage area. Larry «Master Well list TIO Report 2009 04 30.x1s» file://C:\Users\snlg\AppData\Local\Temp\RE 2009 April's PCU #4 Storage Well Monitori... 7/28/2009 This document was created with Win2PDF available at http://www.win2pdf.com. The unregistered version of Win2PDF is for evaluation or non-commercial use only. This page will not be added after purchasing Win2PDF. 2009 March's PCU #4 Storage ~11 Monitoring Report ~ Page 1 of 1 Regg, James B (DOA) From: Greenstein, Larry P [Greensteinlp@chevron.com] Sent: Monday, April 06, 2009 9:57 AM To: Maunder, Thomas E (DOA); Regg, James B (DOA) Cc: Orr, Gary A.; Winslow, Paul M; Ross, Gary D Subject: 2009 March's PCU #4 Storage Well Monitoring Report Attachments: Master Well List TIO Report 2009 04 01.x1s Hi Tom & Jim, ~~% Here is March's month) report for the wells requiring pressure monitoring for the PCU #4 storage reservoir. The previous three month data window has been widened to a six month window this report to better visualize a well's response to a secondary mechanical integrity failure. With PCU #4 shut-in, PCU #2 has been flowing some including fuel. The estimated fuel usage doesn't show on this plot, so the slow tubing pressure drop for #2 appears unexplained. The monthly production reporting does address the fuel volumes and correctly assigns them between either well #4 or #2 as appropriate. A fuel gas meter has been installed and is awaiting final calibration and start-up. This should fix the data visibilty problem. Per the attached plots, I don't see any indication that any stored gas is not being contained in the approved storage area. Larry «Master Well List TIO Report 2009 04 01.x1s» 4/14/2009 Pressure _ _ _ _ N ? O N O N A 67 O O O O O O O O O O O O O O O O O 10/03/08 10/06/08 10/09/08 10/12/08 ~ I ( I 10/15/08 10/18/08 D o ~ c ~ 10/21 /08 - - w ~ w ~ ! 10/24/08 ~ ~ ° ~ ~ 10/27/08 ° ~ ~ ~° 10/30/08 - 11 /02/08 11 /05/08 11 /08/08 11/11/08 11/14/08 11/17/08 ~.r>~,.~ .:._~..~-_ ~~ ~~ ~ b 11 /20/08 ~ ~. ~ 11 /23/08 ~ 11 /26/08 _ ~ 11 /29/08 ~ 12/02/08 ~ 12/05/08 12/08/08 ~ 12/11/08 '~ ~ ~ 12/14/08 12/17/08 12/20/08 _~ _ _y __ 12/23/08 ~ 12/26/08 12/29/08 ~ 1 /01 /09 C 1 /04/09 ~ 1 /07/09 ~ y 1/10/09 1 / 13/09 ~ 1 / 16/09 1 /19/09 ~ 1 /22/09 1/25/09 ~ ~p 1 /28/09 ~ 1 /31 /09 ~ rb 2/03/09 ~ ~' 2/06/09 "' 2/09/09 2/12/09 _,~ .._ ~:. ~ 2/15/09 ._:, ,,. ~. -----_-- ~ -~~..~~w .~ 2/18/09 2/21 /09 2/24/09 2/27/09 3/02/09 3/05/09 3/08/09 3/ 11 /09 3/ 14/09 3/ 17/09 3/20/09 is 3/23/09 3/26/09 ' 3/29/09 4/01 /09 O O N O W O A O (T O O O ~! O o g g Ra th o o g Pressure N A O N O N O O O O O O O O O O O O O 1 3/08 / 0 0 10/06/08 10/09/08 10/12/08 10/15/08 _ _._ 10/18/08 ~ ~ 10/21 /08 ~ ~ I 10/24/08 c ~ o ~°' '~ $ 10/27/08 o - ~ w _ ~ i 10/30/08 ~ , ~ 00 ~ 11 /02/08 --- - - _ - ~ 11 /05/08 11!08/08 11/11/08 11 /14/08 11 /17/08 b 11 /20/08 O 11 /23/08 '"r 11 /26/08 b 11 /29/08 ~ '~ 12/02/08 vii 12/05/08 ~' ~ 12/08/08 12/11 /08 ~ 12/14/08 ~y, ~G" 12/17/08 12/20/08 ~~ 12/23/08 ~ 12/26/08 ~, ''r ~ 12/29/08 C 1 /01 /09 ~ 1 /04/09 y ~~ 1 /07/09 ' 1 /10/09 ~ 1/13/09 ~ 1 /16/09 i 1/19/09 1 /22/09 1 /25/09 ~ ' 1 /28/09 ' '-' 1 /31 /09 ~ b 2/03/09 (~ 2/06/09 2/09/09 N 2/12/09 2/15/09 2/18/09 02/21 /09 2/24/09 02/27/09 3/02/09 3/05/09 3/08/09 a 3/11 /09 3/14/09 3/17/09 03/20/09 3/23/09 3/26/09 '' 3/29/09 4/01 /09 _ O N CJ A CJi 6> ei ' 2009 February's PCU #4 Stormell Monitoring Report ~ Page 1 of 1 Regg, James B (DOA) From: Greenstein, Larry P [Greensteinlp@chevron.com] Sent: Thursday, March 05, 2009 3:26 PM To: Maunder, Thomas E (DOA); Regg, James B (DOA) ~~ Cc: I Orr, Gary A.; Winslow, Paul M / Subject: 2009 February's PCU #4 Storage Well Monitoring Report Attachments: Master Well List 2009 03 02.x1s Hi Tom & Jim, Here is February's monthly report for the wells requiring pressure monitoring for the PCU #4 storage reservoir. ------- PCU #4 had been used heavily for a while, but is now shut-in. The pressures responded as expected and are well within normal ranges. We did achieve some short lived production from PC #2, but were not able to sustain the flow rates. Per the attached plots, I don't see any indication that any stored gas is not being contained in the approved storage area. Larry «Master Well List 2009 03 02.x1s» Pressure 0 0 o a o 0 0 0 0 0 0 0 0 11 /30/08 12/03/08 _- 12/06/08 ', 'E 12/09/08 0 o c W co ~' a ~_ 12/12/08 ~ ~ ~ ~ 00_ ~ o ~ 12/ 15/08 ~ a 12/ 18/08 ---- - 12/21/08 b 12/24/08 p 12/27/08 ~ 12/30/08 ~ 1 /02/09 ~ ~ ~! ~D 1 /05/09 ry„ 1 /08/09 -~ k 1/11/09 1/14/09 ° ~ p #' 1/17/09 y 1 /20/09 1 /23/09 ~ ~ 1 /26/09 ,...~ 1 /29/09 rb 2/01 /09 2/04/09 ~ 2/07/09 ;~ ~~~ ; 's 2/10/09 `~ . F 2/13/09 - ` E a r.'~ 2/16/09 2/19/09 2/22/09 2/25/09 2/28/09 O N W ? (T O O v -. O ~ O o O n`a }~ ~pp O tZJ O O O O O i i 11 /30/08 12/03/08 12/06/08 12/09/08 12/12/08 12/15/08 12/18/08 12/21 /08 12/24/08 12/27/08 12/30/08 1 /02/09 1 /05/09 1 /08/09 1 /11 /09 1 / 14/09 1 / 17/09 1 /20/09 1 /23/09 1 /26/09 1 /29/09 2/01 /09 0/09 3/09 6/09 9/09 b r.r O b C C y ~• CD b N ° o 0 0 o Rye a o 0 o S 2009 January's PCU #4 Storag~ell Monitoring Report Page 1 of l Regg, James B (DOA) From: Greenstein, Larry P [Greensteinlp@chevron.com]~~~ zll<<~~ Sent: Wednesday, February 04, 2009 2:48 PM To: Maunder, Thomas E (DOA); Regg, James B (DOA} Cc: Orr, Gary A.; Winslow, Paul M Subject: 2009 January's PCU #4 Storage Well Monitoring Report Attachments: Master Well List TIO Report 2009 01 31.x1s Hi Tom & Jim, Here is January's monthly report for the wells requiring pressure monitaring for the PCU #4 storage reservoir. PCU #4 has been used heavily for a while now and has responded well. We attempted to flow PC #2 at the end of last month and had some success. Don't know if it wi(I keep flowing or not. Per the attached plots, l don't see any indication that any stored gas is not being contained in the approved storage area. Larry «Master Well List TIO Report 2009 01 31.x1s» 2/5/2009 Pressure 0 0 0 0 °o 0 0 0 0 0 0 0 0 0 0 0 0 10/31 /08 ~~ ~ 11 /03/08 ~ ~ ~ F~ ~ ~ ~ ~ ~ r 11 /06/08 ~ ~ i ~ < < ~ ~ ~ I ~! "~ 11 /09/08 ' . t o o c - ~ w U, ~'' ~ w ~± ~ ~ I ~ ~ ~ `. ~ o _ oo ~ ,; 11 /12/08 ~ ~ ~ i ~ °- ~ ~ ~~ i ~ y 11 /15/08 " ' ~ ~ - , ~ '' 11/18/08 ' ~ ; I ~ u i 11 /21 /08 '. i i ~ ~; ~ i ~ s q 11 /24/08 ~ ~ ~ "" 11 /27/08 ' ~ i I ~ ~ s ~ 11 /30/08 j 12/03/08 ' I i ~ i ~ ~ 12/06/08 . { ~ 12/09/08 i ~ ~ ~ i ~ I ~ 12/12/08 I i i i ~ A~ I ~ ' ~ I `^ ~ 12/15/08 ~ ~ ~ ~ = ~ ~ 12/18/08 ' ~ i i ~ y 12/21 /08 ~ ~ ~ ~ ~ ~.. ' ~ ~ ~ '~ rD 12/24/08 ~ i 12/27/08 ' ? ~ i I %' ~ 12/30/08 ~ I i ~ ; b 1/02/09 ~ I i ~ ~ ~ ;; ('~ 1 ( I 1 /05/09 " I I ~ 1 /08/09 ' I ~ ~ `` I 1 /11 /09 1 /14/09 ~ s 1 /17/09 ' ! i ~ ~ 1 /20/09 j ~ ~ I ~ 1 /23/09 ' i I % 1 /26/09 ~ j j I 1 /29/09 ~ ~ I ' I I , o ° ° o ° ° ° ° o 0 o 0 o Rath o o o 0 o 0 Pres sure O N O W A O O ( O T O v O O Oo O O O O O O O O O O O O O O O O 10/31 /08 _ ! { 11 /03/08 ii ; ~ y'. I 11 /06/08 ' ~ ~ i i ~ ~ I 11 /09/08 ~ I ~ ! i I I ~ 11 /12/08 ~ i ~ { ~ C t ~ ~ ~ O C O_ W ~ ~' W ~ ~ °D ~ - 11/15/08 ' I i j _.__ ____ y 11 /18/08 ~ ' ~ ~ i ~ 11 /21 /08 ! ~ i ~ ~ 11 /24/08 ~ { I I ~ ~, ~ ~ 11 /27/08 ; I ~ ~ ! b ~ ~'! 11 /30/08 j i ~ ~ i 12/03/08 ~ ~ ~ ~ ~ C ~ 12/06/08 I ! j I I I i ~ U 12/09/08 i ~ i ~ 12/12/08 i I ,~.r I ~ 12/15/08: j ! ~ i i I ~ ,, ~ 12/18/08 ! ~ ' ~ ~ i..] 12/21 /08 ~ ~ ~ ~... i ~ ~ ~ ~ ~ rD ~ 12/24/08 " ~ i ~ ~ ~ ~ i ~ ~ 12/27/08 ~ ~ I j i 12!30/08- ~ ~ j ~ ~ ~ j ~ ~ ~ b 1 /02109 ~ ~ ~ '~ i 5 ~ ' I I ~" 1 /05/09 ~ j ~ i N ~ ~ ~ 1 /08/09 _ ~: ~ ~ I i ~ i i 1/11/09 j , i ~ j 1!14/09 ~ ~ ! i i i i i 1 /17/09 ! ~ ~ I i ~ i~ 1 /20/09 ~ I I I ~ ~ ~ ¢ ff 1 /23/09 _ ~ ! j fi i 1 ! ~ 7 1 /26/09 1 ! ~ i i ~ i ~. 1 /29/09 ~ ~ ~ ! I i ~ ~ i ~- ° o 0 0 o R ye o $ o 0 0 ~ ~ ~ 35 Page 1 of 2 • • Regg, James B (DOA) ~~~ ~ ~~~ From: Winslow, Paul M [PWinslow@chevron.com] Sent: Friday, August 01, 2008 1:31 PM To: Roby, David S (DOA) Cc: Maunder, Thomas E (DOA); Davies, Stephen F (DOA); Regg, James B (DOA); Whitacre, Dave S Subject: RE: SIO 4 expansion request questions Dave, For at least the first {and likely second} injection/production cycle, I'm sure we will keep the reservoirs separate. The 51-5 reservoir is acting very predictable and we wouldn't want to jeopardize it. li is also nearly full at the current time, and we don't want to cross-flow storage gas back into the 45-0 sand, without knowing how that reservoir {45-0) is going #o behave. Depending upon how the storage operations go in the 45-0 reservoir, we may entertain the idea of commingling injection/production in the future. Far my own accounting/material balance calculations, I would prefer keeping the two reservoirs totally separate, but that decision will be made at a later date. If you or Jim have any other questions, please give me a call or shoot me an email. Thanks, Paul Paul Winslow Chevron North American Exploration & Production MidContinent /Alaska Business Unit 909 West 9th Ave, Anchorage, AK 99501 Tel: 907-263-7629 Cell: 907-382-3813 Fax 907-263-7828 pwinslow@chevron.com From: Roby, David S (DOA) [mailto:dave.roby@alaska.gov] Sent: Friday, August 01, 2008 11:21 AM To: Winslow, Paul M Cc: Maunder, Thomas E (DOA); Davies, Stephen F (DOA); Regg, James B (DOA) Subject: SIO 4 expansion request questions Hi Paul, I have a question about your request to add the Sterling 45-0 and to the strata authorized for injection in the PCU No. 4 well. In the application you mention that you would "likely close" the sleeve to isolate the 51-5 and then open the sleeve to allow injection in the 45-0. Is it your intention to operate these two sands independently or do you plan to commingle them? The reason I ask this is that in SIO 4 it mentions trapping of gas by water encroachment in the 45-0 sand and concern about loss of injected gas due to elevated water saturation in the sand. Allowing the 45-0 and 51-5 to be commingled prior to determining if the concerns with the 45-0 sand are resolved could have severe adverse 8/6/2008 • • Regg, James B (DOA) From: Roby, David S (DOA) Sent: Friday, August 01, 2008 11:21 AM To: Regg, James B (DOA) Subject: FW: SIO 4 Admin Approval Request Here's Steve's concern. Dave Roby Phone: 907-793-1232 email: dave.roby~a alaska.gov Page 1 of 1 ~~~ ~-----° ~~ From: Davies, Stephen F (DOA) Sent: Thursday, July 24, 2008 9:59 AM To: Maunder, Thomas E (DOA); Roby, David S (DOA); Regg, James B (DOA) Subject: RE: SIO 4 Admin Approval Request In SIO 4, trapping of gas by water encroachment in the 45-0 sand is mentioned on page 3, along with some concern about loss of injected gas due to elevated water saturation in the sand. I think opening the 45-0 sand to storage injection is fine, but suggest that we require a complete injection -production cycle in the sand prior to allowing commingling of production from both sands. From: Maunder, Thomas E (DOA) Sent: Thursday, July 24, 2008 7:45 AM To: Roby, David S (DOA); Davies, Stephen F (DOA); Regg, James B (DOA) Subject: RE: SIO 4 Admin Approval Request Looking at Unocal's application, I think it is clear that they have been injecting into a confined volume. They state it is planned to close the sliding sleeve of the 51-5 and open the sleeve opposite the 45-0 sand. Do we know if once the pressures are -equal if they plan to commingle the zones? Tom From: Roby, David S (DOA) Sent: Wednesday, July 23, 2008 2:41 PM To: Davies, Stephen F (DOA); Maunder, Thomas E (DOA); Regg, James B (DOA) Subject: SIO 4 Admin Approval Request In accordance with Rule 1 of SIO Chevron has presented data on their storage operations in the Beluga 51-5 sand and are now seeking authorization to begin injection into the Sterling 45-0 sand, as was envisioned in the origin application and order. I'll be distributing copies of the application to each of you shortly. Please review and give me any comments or questions you may have. I would appreciate a response by the end of the week. Thanks, Dave Roby Reservoir Engineer Alaska Oil and Gas Conservation Commission Phone: 907-793-1232 Fax: 907-276-7542 email: dave.roby~a alaska.gov 8/6/2008 2008 July's PCU #4 Storage Well Monitoring Report Page 1 of 1 • Regg, James B (DOA) From: Maunder, Thomas E (DOA} Sent: Tuesday, August 05, 2008 8:50 AM To: Roby, David S (DOA) Cc: Regg, James B (DOA) Subject: FW: 2008 July's PCU #4 Storage Well Monitoring Report Attachments: Master Well List TIO Report 2008 07 31.x1s Dave, Here is a report we get monthly from Unocal/Chevron regarding Pretty Creek. Prior reports are stored on the W drive in Unocal_Storage_Pretty_Creek. You might take a look at the information from Pretty Crk #2. They did produce it in the month. The pressure response seems to indicate that the resource accessed by that wellbore might be near depletion. FYI. ) Tom ~~~ Pl-~ .~llS`~ ~e,~ From: Greenstein, Larry P [mailto:Greensteinlp@chevron.com] Sent: Monday, August 04, 2008 4:49 PM To: Maunder, Thomas E (DOA); Regg, James B (DOA) Cc: Orr, Gary A.; Winslow, Paul M Subject: 2008 July's PCU #4 Storage Well Monitoring Report Hi Tom & Jim, Here is July's monthly report for the wells requiring pressure monitoring for the PCU #4 storage reservoir. PCU #4 continued with injection last month which shows up nicely as a slow increase in wellhead pressure. There also was a little gas production from the PC #2 well last month. Per the attached plots, I dan't see any indication that any stored gas is not being contained in the approved storage area. Larry «Master Well List TIO Report 2008 07 31.x1s» 8/6/2008 PCU 4 TIO Storage Injection History 1800 1600 1400 1200 c. 1000 m N ~ 800 a 600 400 200 0 O~ ~~~,`~ O~ ~~~~~\ O~ ^~\~~~ O~ ~~ ~~ O~ ~~~,~~ 00 ~\~O\ 00 ~\~p\ 00 ~~~ 00 ~~r~\ 00 O~rp\ O~ O\~O\ O~ ~~n~\ ~ O ~ 0 0 O O O D~~~\O ~\~~O h~~~\O h~~0\O O\~~O O\~O~O 1~~0\O '~~~~\O 12000 10000 8000 6000 ~ O 4000 2000 • 0 Date IA OA O OA Tu bing Vol Inj Vol Prod '''°""' - eriy Creek .- 1 No. 4 Tight spot in tubing at 1150' WLM (4/17103) ~~ CASING AND TUBING DETAIL ~ SIZE WT GRADE CONN ID TOP $T~•i. 13-3/8" Surface 120' 9-5/8" 47 L-80 Butt Surface 2,385' 7" 29 L-80 Butt Surface 6,942' Tubing 2-7/8" 6.4 L-80 Butt SC 4,372' JEWELRY DETAIL ~T~'la C `~-~ ~s~_~ ;' 6 C~~"' ~P/~ie Production Tubing Inner String Jewelry I 4521 2.313 3.170 Baker CMD sliding sleeve II 4560 2.313 3.Z4 Baker "X" nipple III 5173 2.313 3.17 Baker CMD sliding sleeve IV 5212 2.313 3.24 Baker "X" nipple V 5319 2.313 3.117 Baker "X" nipple VI 5576 2.313 3.17 Baker CMD sliding sleeve ~ 5584 Bull plug -end of tubing Packers, Screens, Misc. 1 - - Dual Tubing Hanger, 2-718" x 2-318", 11" SM 2 4,372' SC-1 Gravel Pack Packer 3 4,501' Baker Weld Wire Wrapped Screen 4 4,526' SC-1 Gravel Pack Packer 5 5,147' Baker Weld Wire Wrapped Screen 6 5,181' SC-1 Gravel Pack Packer 7 5,554' Baker Weld Wire Wrapped Screen 8 5,584' K-1 Retainer 9 6,862' K-1 Retainer with 12 bbls cement below and 5 bbls above. A 2,517' ~j ~~~ }.,o~.e o~ie ~1 ~,,~ It Heater String 2-3/8", L-80, Butt SC ~~ I~ t `17D 515(? PERFORATION HISTORY nterv ccum ate ne op tm mt sp omments 11/24/2001 Sterlin 4,507' 4,514' 7' 12 32`jQs 32.i3(~' "1'li') 11/17/2001 1Selu a 5,152' 5,172' 20' 12 '3b7~ - 31ofZi TUB il/14/2001 Belu a 5,566' S,57T 11' 12 3~6~•- 3~75~ TL'/~ SLIDING SLE EVE HISTORY SS Depth 5/4/2002 9/21/2002 4/20103 3/22/06 4521 closed open closed closed SI73 open open open open 5576 closed closed open? closed TD = 9,580'MD/7,600' TVD Max Hole Angle = 51 deg PCU 4 Actua105-30-06.doc DRAWN BY: crw/tcb/jws ~~ • • Chevron Paul Winslow Chevron North America Petroleum Engineer Advisor Exploration and Production MidContinent/Alaska P.O. Box 196247 Anchorage, AK 99519-6247 Tel 907 263 7675 Fax 907 263 7847 Email Hal.Martin@chevron.com ~:_ ~"t July 21, 2008 k , :~ , .. ~ .:.~~ Mr. Dan Seamont, Chair u1 ~ `~ `' ~ f ~ `' ~ Alaska Oil and Gas Conservation Commissio , ~ ~~• ~~ ~ ~~:-~ 333 West 7"' Avenue, Suite 100 ~IU~~ §`~ ~~ Anchorage, AK 99501 Re: Application to amend Storage Injection Order No. 4, to include the Sterling 45-0 Sand; Pretty Creek Gas Storage Facility, Pretty Creek Unit Well No. 4 Dear Commissioner Seamount: On May 10, 2005 Union Oil Company of California ("Union Oil") requested an order from the State of Alaska Oil and Gas Conservation Commission (AOGCC) authorizing the underground storage of hydrocarbons into the Beluga 51-5 and Sterling 45-0 sands of the proposed Pretty Creek Gas Storage Facility (PCGSF). On September 12, 2005 the AOGCC issued Storage Injection Oder No. 4 (SIO4), authorizing the storage of natural gas into the Beluga Formation 51-5 sandstone. Rule 1: Storage Injection, states: "After one year of injection storage and retrieval operations have been completed, the operator shall provide a written summary report and meet with the Commission to present its findings. At that time, the Commission will render a decision concerning storage injection operations in the Sterling Formation 45-0 sandstone within the PCU #4 well bore". Having nearly completed the second injection cycle, Union Oil is requesting from the AOGCC an amendment to the existing Storage Injection Order (SIO4) to include the Sterling 45-0 sand. Attachment #1 to this application is a table of gas production and injection volumes for the PCU#4 well beginning with the commencement of primary production and ending with the data through May 31, 2008. Attachment #2 is a table listing the reservoir pressure estimates over the life of PCU #4. These pressures, divided by the non-ideal gas deviation factor (Z factor), have been plotted versus net cumulative gas withdrawn (from the 51-5 sand), on the standard P/Z plot shown as Attachment #3. Viewing Attachment #3, the reservoir pressure measured during the initial injection cycle (2005 - 2007) deviates above the straight line path established by the primary depletion points. As the 51-5 reservoir was filled, the reservoir pressures were converging on the original reservoir pressure. Once production commenced from the 51-5 storage sand, the pressures (2007/2008 production cycle) walked back down the line previously established by the original primary MidContinent/Alaska Chevron North America Exploration and Production • ; • • Commission Chair Dan Seamount Alaska Oil and Gas Conservation Commission July 21, 2008 Page 2 depletion data. Similarly, the latest injection data (5/17/08 - 6/26/08), walks back up the depletion/injection trend, toward the original reservoir pressure. As of 6/26/08, it is estimated that the 51-5 sand is approximately 164 MMcf short of being full. The pressure and injection/ withdrawal data listed and plotted in attachments #1 - #3, clearly demonstrate reservoir confinement of the gas storage volumes injected into the 51-5 sand in the PCGSF. Having shown containment of gas within the Beluga 51-5 storage sand (observed over two production/injection cycles), it is Union Oil's desire to expand the gas storage operations within the PCGSF to include the Sterling 45-0 sand. Primary production from the two sands (combined) was 2.94 Bcf, of which 1.65 Bcf has been attributed to the 51-5 sand and 1.29 Bcf attributed to the 45-0 sand. Adding the 45-0 sand will add an additional storage capacity of over 1.0 Bcf to the Pretty Creek Gas Storage Facility. This will allow Union Oil to better meet peak winter gas delivery demands in South-central Alaska. The PCU #4 well was completed with separate sliding sleeves across the 45-0 and 51-5 sands. Since SIO4 was issued, the sliding sleeve across the 45-0 sand has been closed. Once the 51-5 sand has been filled to its original capacity (estimated to be full in early August), Union Oil will likely close the sliding sleeve isolating the 51-5 sand, and then re-open the sleeve to the 45-0 sand. This will allow Union Oil to obtain a current reservoir pressure from the 45-0 sand. Once authorization is granted from the AOGCC, injection can commence into the 45-0 sand. If you or your staff have any questions or should require any additional information, please contact me at 263-7629. I would also welcome a meeting with the appropriate AOGCC staff to review the attached data. Sincerely, ~~.~~ Paul M. Winslow Petroleum Engineer Advisor cc: Dave Whitacre Shannon Martin Attachments: MidContinent/Alaska Chevron North America Exploration and Production • • Commission Chair Dan Seamount Alaska Oil and Gas Conservation Commission July 21, 2008 Page 3 LIST OF ATTACHMENTS Attachment #1 -PCU #4 Production and Injection Volumes Attachment #2 -PCU #4 P/Z versus Cumulative Gas Production Data Attachment #3 -PCU #4 Material Balance Plot: P/Z versus Cumulative Gas MidContinent/Alaska Chevron North America Exploration and Production AfiTACHMENT #1 - PCU #4 ~DUCTION AND INJECTION VOLUM~ Total Cumulative Primary Production (51-5 and 45-0 Sands) DATE Monthly Gas Prod MCF Monthly Gas Inj MCF Cum Gas Withdrawn MCF DATE Monthly Gas Prod MCF Monthly Gas Inj MCF Cum Gas Withdrawn MCF December-01 80,465 - 80,465 Janua -02 195,929 - 276,394 Janua -06 - - 2,719,005 Februa -02 196,257 - 472,651 Februa -06 - - 2,719,005 March-02 220,869 - 693,520 March-06 - 104,423 2,614,582 April-02 165,533 - 859,053 April-06 - 163,320 2,451,262 Ma -02 26,375 - 885,428 Ma -06 - 3,281 2,447,981 June-02 31,104 - 916,532 June-06 283 - 2,448,264 Jul -02 10,746 - 927,278 Jul -06 292 - 2,448,556 Au ust-02 - - 927,278 Au ust-06 292 - 2,448,848 Se tember-02 33,163 - 960,441 September-06 2,927 59,329 2,392,446 October-02 183,163 - 1,143,604 October-06 - 140,560 2,251,886 November-02 157,256 - 1,300,860 November-06 3,315 96,880 2,158,321 December-02 138,233 - 1,439,093 December-06 - 116,573 2,041,748 Janua -03 117,103 - 1,556,196 Janua -07 49,440 85,109 2,006,079 Februa -03 85,932 - 1,642,128 Februa -07 3,706 85,162 1,924,623 March-03 79,775 - 1,721,903 March-07 58,089 74,450 1,908,262 April-03 17,030 - 1,738,933 April-07 - 184,212 1,724,050 Ma -03 196 - 1,739,129 Ma -07 - 116,641 1,607,409 June-03 - - 1,739,129 June-07 - 64,573 1,542,836 Jul -03 25,313 - 1,764,442 Jul -07 - - 1,542,836 Au ust-03 20,306 - 1,784,748 Au ust-07 - - 1,542,836 September-03 16,087 - 1,800,835 Se tember-07 - - 1,542,836 October-03 9,758 - 1,810,593 October-07 339 - 1,543,175 November-03 3,544 - 1,814,137 November-07 94 - 1,543,269 December-03 52,856 - 1,866,993 December-07 37,071 - 1,580,340 Janua -04 57,353 - 1,924,346 Janua -08 99,982 - 1,680,322 Februa -04 55,318 - 1,979,664 Februa -08 107,659 - 1,787,981 March-04 45,931 - 2,025,595 March-08 634 - 1,788,615 April-04 - - 2,025,595 April-08 283 - 1,788,898 Ma -04 56,583 - 2,082,178 Ma -08 - 128,809 1,660,089 June-04 70,263 - 2,152,441 June-08 Jul -04 21,267 - 2,173,708 Jul -08 Au ust-04 74,030 - 2,247,738 Au ust-08 September-04 41,208 - 2,288,946 September-08 October-04 83,626 - 2,372,572 October-08 November-04 80,884 - 2,453,456 November-08 December-04 71,571 - 2,525,027 December-08 Janua -05 62,310 - 2,587,337 Februa -05 54,328 - 2,641,665 March-05 55,460 - 2,697,125 A ril-05 57,247 - 2,754,372 Ma -05 53,045 - 2,807,417 June-05 40,800 - 2,848,217 Jul -05 40,964 - 2,889,181 Au ust-05 37,981 - 2,927,162 Se tember-05 8,872 - 2,936,034 October-05 - - 2,936,034 November-05 - 59,329 2,876,705 December-05 - 157,700 2,719,005 ATTACHMENT #2 - P/Z Data Gauge Measured Pressure Test @ Datum Cumulative Depth Pressure at Depth, Gas Produce, Wellname Date Test Type Reservoir (MTD), ft MTD, psia Datum TVD Z res Psia bcf P/Z, Psia Comments PRIMARY PRODUCTION PCU 4 2/3/2002 SIBHP 45-0, 51-5 & 55-6 5 571 1625 3589 0.8539 1457 0.25 1706 All3 Zones open PCU 4 5/11/2002 Surface PBU 45-0 & 51-5 0 1270 3589 0.8678 1270 0.86 1463 Top 2 zones open, bottom zone closed PCU4 4/10/2003 SIBHP 45-0&51-5 5,162 1028 3589 0.8889 1026 1.72 1154 Top2zones open, bottom zone closed PCU 4 5/7/2003 SITP 45-0 0 1005 3589 0.8826 1095 1.73 1241 Well SI on 5/3/03. On 6/5/03, SITP still 990 psi PCU 4 4/20/2004 SITP 45-0 0 630 3589 0.9225 687 2.03 744 Well SI on -4/1/04. Tried unsucc to unload 4/5-6. SI since 4/7/04 PCU4 7!6/2004 Surface PBU 51-5 0 935 3685 0.8893 1021 0.87 1148 72 hr PBU wSPYDR PCU 4 9/20/2004 SITP 51-5 0 833 3685 0.8999 910 1.00 1011 PCU 4 2/7/2005 SITP 51-5 0 625 3685 0.9229 683 1.29 740 PCU 4 2/13/2005 PBU 51-5 5162 669 3685 0.9244 669 1.30 724 PCU4 9/30/2005 Static 51-5 5162 475 3685 0.9454 475 1.65 502 Static gradient with bombs $tOraOe ~q@ratlgrl PCU 4 9/30/2005 Static 51-5 5162 475 3685 0.9454 475 1.650 502 Static gradient with bombs PCU4 2/9/2006 SITP 51-5 0 665 3685 0.9184 726 1.429 791 38 day SITP PCU 4 5/3/2006 BH Falloff 51-5 5162 3685 0.8857 1061 1.198 1198 24 hr falloff with BH ua es PCU 4 9/27/2006 SITP 51-5 5 162 1119 3685 0.8717 1222 1.072 1402 8 hr SITP after compressor S/D see 9/27/06 morning report PCU4 10/11/2006 SITP 51-5 5162 1141 3685 0.8697 1246 0.987 1433 25 hr SITP-Shut in well to swap annulus fluids PCU 4 10/24/2006 SITP 51-5 5162 1151 3685 0.8688 1257 0.972 1447 25 hr SITP -Shut in well to swap annulus fluids PCU 4 11 /7/2006 SITP 51-5 5,162 1245 3685 0.8609 1360 0.852 1579 35 hr SITP -Shut in well for gas supply/demand PCU 4 11/10/2006 SITP 51-5 5,162 1236 3685 0.8616 1350 0.852 1567 25 hr SITP -Shut in well to swap annulus fluids PCU 4 11 /20/2006 SITP 51-5 5,162 1240 3685 0.8613 1354 0.838 1572 35 hr SITP -Shut in well for as su pl /demand PCU 4 12/3/2006 SITP 51-5 5,162 1248 3685 0.8606 1363 0.824 1584 35 hr SITP -Shut in well for as suppl /demand PCU 4 12/20/2006 SITP 51-5 5,162 1287 3685 0.8575 1406 0.759 1639 8da SITP - Shut in well for as supply/demand PCU 4 12/24/2006 SITP 51-5 5,162 1299 3685 0.8566 1419 0.746 1656 50 hr SITP - Shut in well for as suppl /demand PCU 4 12/28/2006 SITP 51-5 5,162 1295 3685 0.8569 1414 0.738 1651 80 hr SITP - Shut in well for gas suppl /demand PCU4 1/8/2007 SITP 51-5 5,162 1315 3685 0.8553 1436 0.710 1679 8da SITP-Shut in well for as su ~/demand PCU4 2/5/2007 SITP 51-5 5,162 1357 3685 0.8522 1482 0.625 1739 Ida SITP-Shut in well for gas supply/demand PCU 4 5/7/2007 SITP 51-5 5,162 1455 3685 0.8454 1589 0.307 1880 PCU 4 6/5/2007 SITP 51-5 5,162 1492 3685 0.8430 1629 0.205 1933 PCU 4 12/12/2007 SITP 51-5 5,162 1460 3685 0.8451 1595 0.141 1887 2007/2008 Production PCU4 1/1/2008 SITP 51-5 5162 1435 3685 0.8467 1567 0.178 1851 10 da SITP-Shut in well for as suppl/demand PCU4 1/22/2008 SITP 51-5 5,162 1414 3685 0.8481 1544 0.216 1821 6day SITP-Shut in well for gas suppl/demand PCU 4 2/25/2008 SITP 51-5 5,162 1320 3685 0.8550 1442 0.383 1686 8da SITP - Shut in well for as su pI /demand PCU4 4/28/2008 SITP 51-5 5162 1335 3685 0.8538 1458 0.386 1708 -zo da SITP-Shut in well forgas sup ly/demand 2008 Infection Season PCU 4 5/17/2008 SITP 51-5 5 162 1374 3685 0.8510 1501 0.331 1763 3 da SITP - In action shut down temporaril PCU 4 6/23/2008 SITP 51-5 5,162 1465 3685 0.8447 1600 0.169 1894 5 da SITP - Shut in well for compressor repair & Volume check PCU 4 6/26/2008 SITP 51-5 5 162 1464 3685 0.8448 1599 0.164 1893 1 day SITP -Injection shut down temporaril • • O:\NAU\MCBUWIaska\DeplslAssetDev\CIGas\USERS\PMW\Gas Storage\PCU #4\PCU4_Storage PZ_071608.x1s f ATTACHMENT #3 PCU #4 Material Balance Plot: P/Z vs Cumulative Gas (as of 6-26-08) 2500 2000 1500 c~ . y a N a 1000 500 0 -1 0 1 2 3 Net Cumulative Gas Withdrawn, Bcf DOriginal BHP at Fillup (12-12-07) (6-5-07) • Primary Depletion (51-5) •2005-2007 Injection Cycle (51-5) ~;.~ 2005 - 2007 :2007/2008 Production Cycle (51-5) 2008 Injection (thru 6-26-08) ,,b • ~ ~ Injection cycle ~ •2008 Injection Cycle (51-5) _ M ~ ~ Primary production cycle ~ (9-30-05) • • O:\NAU\MCBU\Alaska\Depts\AssetDev\CIGas\USERS\PMVV~Gas Storage\PCU #4\PCU4_Storage PZ_071608.x1s ~ 33 2008 December's PCU #4 Storage Well Monitoring Report Page 1 of 1 • Regg, James B (DOA) S~ ~. From: Greenstein, Larry P [Greensteinlp@chevron.com] Sent: Thursday, January 08, 2009 8:31 AM J To: Maunder, Thomas E (DOA); Regg, James B (DOA) ~ ~~~ ~'~~( Cc: Orr, Gary A.; Winslow, Paul M Subject: 2008 December's PCU #4 Storage Well Monitoring Report Attachments: Master Well List TIO Report 2008 12 31.x1s Hi Tom & Jim, Here is December's monthly report for the wells requiring pressure monitoring for the PCU #4 storage reservoir. _.---- With the cold weather we just came through, PCU #4 has been used heavily and has responded well. Per the attached plots, I don`t see any indication that any stored gas is not being contained in the approved storage area. Larry «Master Well List TIO Report 2008 12 31.x1s» 1 /8/2009 • • Pressure 0 0 0 0 °o 0 0 0 0 0 0 0 0 0 0 0 0 10/01 /08 ~ I i ~ , i 10/04/08 ' ~ ~ ~ ~ _ I L_ _. a~ ~; 10/07/08 ' ~ ' ! ' i 10/10/08 ~ I ~ ( ~ ( I I ~. ~ 10/13/08 ' ~ ~ i o o c w ~ ~ ~ ~ ~ a, ~ ~ ~ 10/16/08 ~ ( `I o ~ ~~ ~ 00_ - ri • co w 10/19/08 ~ { ~ Q I 10/22/08 - i ~ __ ! ~ - ( I ~ b 10/25/08 ~ ~ ~ C 10/28/08 ', { ~ ~ '~ i ~ ~ ' ~ `'d 10/31/08 ~ r I l ~ I I ~ ~ i ' ~ ~ 11 /03/08 ~ ~ i i ' ~ ~ ~ 11 /06/08 ` ~ I I ~ ~ 11 /09/08 ~ ~ ~" ~ ~ r 11 /12/08 ~ ' ~ ~ ~ I ~ A~ ~ n ~ 11/15/08 ' i c ~ ~ ~ ~ M C 11/18/08 ~ . ~ I x y ~ 11 /24/08 ~ I I ~ 11 /27/08 ~ ~ ~ I ~ y 1 ~ 11 /30/08 ~ ~ I { ! ~, ~ r ~ ~ 12/03/08 ' ~ ~ ( ; ~"d f ~ i ~ ('~ 12/06/08 i ~ y 12/09/08 ' ~` ~ j ~ I I I ~ r n 12/12/08 ~ j ~ ~, ' I ~ 12/15/08 1 i ~ ~ r 12/18/08 i j ~ ~ ~ I y 12!21 /08 I I ~ i y ' ~ { I ~ r 12/24/08 ' ~ i 12/27/08 ~ ~ 1 12/30/08 # O -• N W ? CJ1 O v O O O O O O O Rate .. .. 2008 November's PCU #4 Storage Well Monitoring Report Page 1 of 1 Regg, James B (DOA) From: Greenstein, Larry P [Greensteinlp@chevron.com] Sent: Monday, December 08, 2008 8:19 AM To: Maunder, Thomas E (DOA); Regg, James B (DOA) ~~ ( t/2o(Zc~ Cc: Orr, Gary A.; Winslow, Paul M Subject: 2008 November's PCU #4 Storage Well Monitoring Report Attachments: Master Well List TIO Report 2008 11 30.x1s Hi Tom & Jim, STS 4 Here is November's monthly report for the wells requiring pressure monitoring for the PCU #4 storage reservoir. The use of storage has started with the cold weather we just came through and PCU #4 responded Weil. Per the attached plots, I don't see any indication that any stored gas is not being contained in the approved starage area. Larry «Master Well List TIO Report 2008 11 30.x1s» 12/8/2008 Pressure N A O O O O O N O O O O O 8/31 /08 i ~ 9103/08 I I I 9/06/08 ~ i ~ ~ ( < ~ N ~ ~ 9/09/08 i ' ~"' ~ w 00= I . ~ 9/12/08 ( 9/15/08 ~ ~ ~ ~ 1 { 9/18/08 " ~ I ~ 9/21 /08 ' ~ I ~ I ' i b 9/24/08 ~ ~ ~ O 9/27!08 i ~ ~ ~ ~ ~ b 9/30/08 ' ~ ~ ~ 10/03/08 ~ ~' ~„ ~ 10/06/08 ~„ ~ 10/09/08 } 10/12/08 E ~ l ~ A~ 10/15/08 - . ~ I f ~ ~ ~ ( C 10/18!08 j ~ ~' 10/21 /08 I 10/24/08 ~ ~ j ~ ~D I ~ ~ i 10/27/08 ~ ~ I 10/30/08 ~ ~ ~ i i ,~ 11 /02/08 ' ~ I ~ b i ~ ~; 11 /05/08 11 /08/08 i i N 11/11/08 ~ ~ ~ ~ 11/14/08 t 11/17/08 ~ i , 11 /20/08 ~ f 1 ~ i i 11 /23/08 ' 11 /26/08 " j ~ ~ ~ 11 /29/08 ,. O ~ O N O W O A O (J1 O O O O O O O O O Rate • ~ Pressure O O O ~ O O ~ O ~ ~ O O O O O O O O O O O O O 8/31 /08 I I . i i 9/03/08 ' ,_ _ _ t ~ 9/06/08 j i I ~ ~ I I I ~ i i ~ i I u 9/09/08 ' ~ j o o c w ~° ~ ~ ~ = ~ ; 9/12/08 T I ~ > > cn ( ~ ao ~ ~: o • ~ _ ! t ~; 9/15/08 - ~ ~I 9/18108 ' ~ ~ -- ; ' ! -_~ ~ i i ~; i ~ ~ i ~ ~ I 9/21 /08 I ' j I I i 9/24/08 ' ! ~ C 9/27!08 `~ I 9/30/08 l i ~ ~ 10/03/08 ' i I i ~ I ~ ~ { k ~ ' ? I ~ 10/06/08 ~ ~ ~ i ~ ~ i ~ 1 ~ ~ ~ ~ j 10/09/08 ~ 2 " f ~ ~ 10/12/08 ~ ~ ~ ~' 1 10/15/08 ~ s I j ~ ~ ~ ~ ~ ~ I ~ I ( i 10/18/08 ~ ~ } ' ~ ~' ~ ~ y 10/21 /08 ' i I ~ i ; 10/24/08 I ~ { ~ ~ ~ ~ ~ ~' i 10/27/08 ~ ~ ! ! I ~ I 10/30/08 ' 1 j ~ ~ ~ C 11 /02/08 r I ; i 11 /05/08 ` ~ I j ~ i 11 /08/08 I i i ~ ~ '~' 11 /11 /08 '' I ~ ~. i 1 ; '' 11/14/08 ' ~ ~ I i { 1 s 11/17/08 ' ~ 11 /20/08 ' j ~ ~ , j ~ ~ ~ ~ 11 /23/08 ~ ~ ~ j ~ ~ i ~ i 11 /26/08 ~ ~ ~ ~ I i 11 /29/08 p ' N W A CT p O O O O O O Rete 2008 October's PCU #4 Storage Well Monitoring Report Page 1 of 1 • Regg, James B (DOA) From: Greenstein, Larry P [Greensteinlp@chevron.comj Sent: Wednesday, November 05, 2008 3:37 PM ~'~~ Il~~l (~l:~r To: Maunder, Thomas E (DOA); Regg, James B (DOA) Cc: Orr, Gary A.; Winslow, Paul M Subject: 2008 October's PCU #4 Storage Well Monitoring Report Attachments: Master Well List TIO Report 2008 11 01.x1s Hi Tom & Jim, Here is October's monthly report for the wells requiring pressure monitoring for the PCU #4 storage reservoir. The winter is starting which leads to the first uses of PCU #4. The well wasn't used during October, but the usage normally increases dramatically in November each year. There was some production out of PCU #2, but it doesn't seem to maintain any consistent rate. Per the attached plots, I don't see any indication that any stored gas is not being contained in the approved storage area. tarry «Master Well List TIO Report 2008 11 01.x1s» 11/5/2008 Pressure O N O O ~ O O O O O O O O O O O N O O 7/31 /08 ~~~. ` ~~~~,~~»~ I ~ ~ ~ ~ r' 8/03/08 ~ - ~ ;, 8/06/08 `~ ' ~ ~ ' I I I I 8/09/08 -` 1 ~~ ~ ~ o ~ o w ~ ~ ~• W ~ woo oo = ~~; s 8/12/08 I ~ F 8/15/08 ' ' ~ ~ ~ z ~ ~, 8/18/08 E ~ ~ ~ 8/21 /08 f , b 8/24/08 ' ~ ~ , ~ ~ ~ I i 8/27/08 ~ ~ M~ I. ~ ~ 8/30/08 ~ ~ ~ i ~ ~ 9/02/08 ' ~ ;, ~ C ,, ~ ~ 9/05/08: ' ~ I i ~ ~ i I j ~o 9/08/08 ~ ~ i ~~ 9/11/08 ~ ~ ~ ~ ~ N A... ~ ~D 9/14/08 ~ ~ i C ~ ~ ~ 9/17/08 y 9/20/08 `~ i { 1 ~. ti ~ ~ ~ 9/23/08 ' 9/26/08 ~ i ~ I ~ ~ ~ 9/29/08 ' ~' ~ ~ ~ ~ ~ ~ ~ ~ 10/02/08 ~ ~ ('~ `~ 10/05/08 ~ N 10/08/08 ;' ~~ ~ 10/11 /08 ' i ~ ~; 10/14/08 ~ , ~ ~~ 10/17/08 ~~ j i 10/20/08 10/23/08 " 10/26/08 ~ ~ ! ~ ~ 10/29/08 11 /01 /08 ~' ~~ O N W Rye ? o U1 0 O 0 o g ,~ 0 0 o area o 0 ~ ~ ~ N ~ O .. E ~ i ~ _. 80/ 6 0/ L 6 z / 1 ~~ '~ ~ 80/sZ/0 L ~ ~ i ~ j . 80/9Z/0 L ~ N ~ ~ ~ ~ ~ ~ ~ ' ~ 80/£Z/0 L ` i ~ ~ ~ ~ ~' 80/OZ/O G ~ i ~ ; I ! i ~ ' ~ 80/L L!0 l I i ~ I L ( ' 80/til/Ol f i ~ 'i ~ ~ ~ 80/ L L /0 L ~ k 80/80/0 ~ ~ ~ so/so/o ~ ~ ~ ~ , 8o/ZO/o ~ ~ ~ ' 80/sZ/6 ~ i 80/8Z/6 i ' I f ~ ! ; I ~ ~ 80/OZ/6 ~ y ~ ~ I ~ 1 ~ i ~ ~ 8o/L ws i . 80/~ ~/s ~ ~ { ~ ~ ~ 80/ L L/6 j ~ ~ ~ I '. ! ~ I ~ l 80/80/6 G~ ~ I ' ' ~ g 80/50/6 L ~ I ~ ~ ~ ~ ~ ; I r ~ 80/ZO/6 ~ ~ ~ r ~ ~ 1 ! I 80/0£/8 Q, , j , ~ ~ 80/LZ/8 ~ i ~ a ~ ! I 80/~Z/8 i j ~ r I ( ~ ~ 80/ 1 Z/8 ~ ~ ~ i 80/8 L/8 -- -~--- ~ ' 80/5l/8 ~ ~ I 8o/z ~/8 j ~ r` ~ M `n M rn ~ i H > > ~ ~~ ' : 80/60/8 a 1 ~ I ' ~ 80/90/8 . ~ I 80/£0/8 ,r - -- - - i ~ ! f z , I , °o °o °o °o °o °o °o °o °o 00 CO r r ~ r N r O Op r CO ~ N aanssaa~ 2008 September's PCU #4 Storage Well Monitoring Report Page 1 of 2 • • Regg, James B (DOA) From: Maunder, Thomas E (DOA) Sent: Friday, October 03, 2008 9:30 AM To: Regg, James B (DOA) Subject: FW: 2008 September's PCU #4 Storage Well Monitoring Report He missed copying you on this message. From: Greenstein, Larry P [mailto:Greensteinlp@chevron.com] Sent: Thursday, October 02, 2008 4:49 PM To: Maunder, Thomas E (DOA) Subject: RE: 2008 September's PCU #4 Storage Well Monitoring Report First Tom, let me apologize for sending the entire file to you with this e-mail. Normally I only send the worksheets for the wells represented in the e-mail..,sorry. As for PCU #4 pressures, there was an acid stimulation done this last month that didn't go so well. Lots of attempts to get the well to 'clean up' resulted in both pushing and puNing on the well pretty hard. This appears to have worked and the wel! is starting to respond better. Hapefully these efforts will last through the winter and we°II have a fully functional storage well at our disposal. As for PCU #2, no idea. The early graph praduction is almost a blowdown or unloading attempt to get the well to filow. As the well died off, nothing seemed to work. The latest increase in tubing pressure is the mystery to me. I'll see what I can find out.,.maybe the well is trying to flow again (don't I wish). Hope this helps explain the pressures, Tom. Larry From: Maunder, Thomas E (DOA) [mailto:tom.maunder@alaska.gov] Sent: Thursday, October 02, 2008 8:20 AM To: Greenstein, Larry P Cc: Regg, James B (DOA) Subject: FW: 2008 September's PCU #4 Storage Well Monitoring Report Larry, There appear to be some large pressure swings on the Pretty Creek wells. Any explanation? Tom Maunder, PE AOGCC From: Greenstein, Larry P [mailto:Greensteinlp@chevron.com] Sent: Wednesday, October 01, 2008 3:36 PM To: Maunder, Thomas E (DOA); Regg, James B (DOA) Cc: Orr, Gary A.; Winslow, Paul M Subject: 2008 September's PCU #4 Storage Well Monitoring Report Hi Tom & Jim, Here is September's monthly report for the wells requiring pressure monitoring for the PCU #4 storage reservoir. 10/3/2008 2008 September's PCU #4 Storage Well Monitoring Report Page 2 of 2 • • Once again, there was very little use of PCU #4 and no use of PCU #2 last month. Pressures appear to be remaining stable. Per the attached plots, I don`t see any indication that any stored gas is not being contained in the approved storage area. Larry «Master Well List TIO Report 2008 09 30.x1s» 10/3/2008 ~ ~ P ressure 0 0 0 ° o 0 0 ° 0 0 o o 6/30/08 , „~. ~ J 7/03!08 ' ~ I ~ ~~ ___ 7/06/08 ? ! ~ ~ 7/09/08 I ~ o o c w ~l ~ , C° ~! 7/12/08 ~ j ~ ~ o0 ' o ~ ~ ~ r 00- ~~ s . 7115/08 ~ ~I Q -- ! ~' i ~ ~ r 7/18/08 ~ I ~ i ~ 1 9 7/21 /08 ! I I ! j I ~, j ~ I ' ! 2 b 7/24/08 ~' fi 7/27/08 ~ I. I ~ ~ i 4 ~ ' 'r ~ i , 7/30/08 i ~ ~ ~ ~ 8/02108 ~ i ~ i ! ; C , 8/05/08 ' ~ ~ i ~ ~ 8/08/08 ~ F , j 8/11 /08 ` ` ~~ ~ ~ ~ I A~ ~ ~ ~ F I i ~ ~ 8/14/08 ' ~ ~ ~ ~ ~ G 8/17/08 ~ ~ 1 I ! ~ ~, 'r ~ ' 1 ~' ~ 8/20/08 ~ ~ ~ I a ~• i ~ i ~ 8/23/08 ~ ~ i r 8/26/08 ' ~ ~ ~ ~ 8!29/08 j ~ ~"'d ~ ! i 9/01 /08 I ~ ~ 9/04/08 ~ 9/07/08 ~ ! j ~ ~ ~~ 9/10/08 - ~ 1 ~ ~ , 9/13/08 ', { ~ ~ I ~ i j i i ~ ~- ~ 9/16/08 ~~ ~ ~ j I ~ ~ ~ ~ 9/19/08 4 i i ~ ~ I ' j I ' I I ~ , I i 9/22/08 i ~' ~ ' I ~ f 9/25/08 ~~ ~ ~ ~ 'm s 9/28/08 ° 0 0 0 0 0 0 0 o Rite o 0 0 r 2008 August's PCU #4 Storage Well Monitoring Report Page 1 of 1 . • • Regg, James B (DOA) From: Greenstein, Larry P [Greensteinlp@chevron.com] Sent: Tuesday, September 09, 2008 2:07 PM To: Maunder, Thomas E (DOA); Regg, James B (DOA) ~~~ j ~ ~~~ Cc: Orr, Gary A.; Winslow, Paul M Subject: 2008 August's PCU #4 Storage Well Monitoring Report Attachments: Master Well List TIO Report 2008 08 31.x1s Hi Tom & Jim, Here is August`s monthly report for the wells requiring pressure monitoring for the PCU #4 storage reservoir. There was very little use of PCU #4 and no use of PCU #2 last month. Pressures appear to be stable. Per the attached plots, I don't see any indication that any stored gas is not being contained in the approved storage area. Larry «Master Well List TIO Report 2008 08 31.x1s» 9/9/2008 Pressure 0 0 0 0 °o 0 0 0 0 0 0 0 0 0 0 0 0 0 0 5/31 /08 6/03/08 ~ ~ I 6/06/08 ~ ~ i ~ I ~ ~ ! l ~ o o c ~ w ~ ' - '~ 6/09/08 ' j ~ ~ - ~ w ~ 1 ~. (~ a _ 6/12/08 ~ j 6/15/08 ~, ~ i ~ 6/18/08 ' ~ ~ t 6/21 /08 ~ ~ i ~ ~ ~~ b 6/24/08 i ~ ~ O ~ y ~ 6/27/08 ~ ` ~ i ,,~ ~ ~ 6/30/08 i j f D ~ I ~ 7/03/08 ' i %'', C ~ '~! 7/06/08 i ~ I ~ 4 ~ w 7/09/08 ' ~ 7/12/08 ' ~ ~ ~ ~ 1 ~ ~ 7/15/08 j ~ I ~ i H C 7/18/08 i ~ j ! ~ M"~ 7/21 /08 ~ , j l i ~"' ~ i ' ~ ~ ~ 7/24/08. :' ~ 7/27/08 `` ~ j I l ~ ~ 7/30/08 ` ~ I ~ ' j ~' ~ { 1 ` ~ 8/02/08 I ~ u ~ b 8/05/08 i ' { ~ ~ { ~ 8/08/08 i ~ i s j ~ ~ ~ 8/11 /08 i i ~ ~ ~ i ~; 8/14/08 i j ~ A A 8/17/08 ; { i I ' i ~; j ~ . 8/20/08 i ~ ~ ~ I a ~, 8/23/08 ' ~ 8/26/08 ~ i ~ ' ~ { ~ i 8/29/08 { ~ ~• ~ .. 1-, , ° ° Rates ° ° • Pressure 0 0 0 0 °o 0 0 0 0 0 0 0 0 5/31 /08 6/03/08 ~ ~ _ _ -~ ---,, y ' 6106/08 i ~ 6/09/08 ~ ' ~ ~ ~`' ~ co ~' ° ~' ' ~ ~ w j it I ~ -~ ° ~° ~,' n °D 6/12/08 I ~ 6/15/08 ~ I ~ ~ i 6/18/08 6/21 /08 ~ ~+ ~ y, b 6/24/08 ~~ ~ i ~ r ~ ~ ~ ~ 6/27/08 ~ ~ ~ y 6/30/08 ' y , ~ ~, ~ 7/03/08 "~ ~ ~ ~ ~ C 7/06108 ~ I ~ r` i 7/09108 1 ~ ~k 6 7/12/08 ~ ~ ~ ~ r ,~.r ~; ~D 7/15/08 f ~ ~ ~ j 7118/08 j ~ I j r..~ 7/ 1 /08 ~ ~• 2 ' ~ i { y ~ ~ ~ 7/24/08 ' ~ j ~ ~ ~ ~ 7/27/08 ': i ~ r ~ ~ 7/30/08 i { I ! ~ y ~ ~ .... r ~ b 8/02/08 `~ i 8105/08 j N ~ { 8/08/08 8/11 /08 ~ i I ( y j 8/14/08 ' ~ 8/17/08 ( i ~ 8/20/08 j ~! 8/23/08 , ~ f ~ a i I 8/26/08 I i 8/29/08 H s } ~ ~ ~ N R~e ° ° N o W W o ° ~ ° o o o o .. 2008 July's PCU #4 Storage Well Monitoring Report • Regg, James B (DOA) From: Greenstein, Larry P [Greensteinlp@chevron.com] Sent: Monday, August 04, 2008 4:49 PM To: Maunder, Thomas E (DOA); Regg, James B (DOA) Cc: Orr, Gary A.; Winslow, Paul M Subject: 2008 July's PCU #4 Storage Well Monitoring Report Attachments: Master Well List TIO Report 2008 07 31.x1s Hi Tam & Jim, • Page 1 of 1 Here is July's monthly report for the wens requiring pressure monitoring for the PCU #4 storage reservoir. PCU #4 continued with injection last month which shows up nicely as a slow increase in wellhead pressure. There also was a little gas production from the PC #2 well last month. Per the attached plots, I don't see any indication that any stored gas is not being contained in the approved storage area. Larry «Master Well List TIO Report 2008 07 31.x1s» 8/4/2008 Pressure 0 0 0 0 °o 0 0 0 0 0 0 0 0 0 0 0 0 0 0 4/30/08 ~" '~""`". 5/03/08 I 5/06/08 _ I I ;""'""~ 'i.°~~ """ 5/09/08 - ~ ~ I 5/12/08 ~ i 5/15108 ~ ~ ~,I ~I 5/18/08 ~ 5/21 /08 ~ __ . ~ _ 1 b 5/24/08 ~ ( I I I ~ O ~ ~ 5/27/08' ~ o o~ w~ ~~ ' rb 5/30/08 j i ~ ~ j w ~ ~-! o ~. ~ ao_ 00 ! ~ a ~ ~ 6/02/08 ~ ~ ~ T ~ ~ ~ 6/05/08: ~ i ~ ~ ~ i ~ QO 6/08/08 ' ~ 6/11/08 { i ~ I CD 6/14/08 I ! ~ C ~ 6/17/08 ', i ~I i..~ 6/20/08 ' ~. ~' i ~D i I 6/23/08 ~ /08 i 6/26 i ~ ~ CD 6/29/08 - ~~~ ~ j ~'~ ~'` "" ~ 7/02/08 i n ~ 7/05/08 ' I I I ~ I 7/08/08 j t 7/11/08 ' I '~ 7/14108 i i ~ ~ ~ I 7/17/08 i 7/20/08 7/23/08 I ! ', ', 7/26/08 ~ ~ ' ~' 7/29/08 j ~ j ~ ~ o ~ N W ~ U1 Rates ° ° 0 0 0 0 • • Pressure 0 Q 0 0 ~ ~ ~ 0 ~ 4/30108 »~"~ , :, : 5/03/08 _-__-- -__-_- 5/06/08 1 ( I ~ I , ~ ~ N ~ ~ 5/09/08: ~ o ~ ~ w o, ~ ' `, /12/08 I I ~ ~• ~ oo a ~ 5 -. 5/15/08 1 5/18/08 5/21 /08 { 1 ~ 5/24/08: i ~ O i ~ ~ ~ 5/27/08 ~ :, b ' ~ "! 5/30/08 ~ ~ ~~ ~ ~, ~ 6/02/08 j ~ ~ ~ ,; i I 6/05/08 i ~ , 6108/08 " ~ /~ ~ ~ ~ ~ 6/11 /08 ~ `, ~ 6/14/08: ~ ~ i 6/17/08 ' ' i '~ y ~ 6/20/08 i , I ~ i ~ t ` ~ 6/23/08 ~ ~ ~ ~ e i ' 6/26/08 ii ~ ~ 6/29/08 ~ ~ b 7/02/08 C 7/05/08 ~ ~ i j ', N 7/08/08. ~ I 7/11/08 7/14/08 ~ ~ ~ ~ 1 7/17/08: 7/20/08 ' ~ ~ ~ i 7/23/08 i j 7/26/08 °; 7/29/08: ~ i ~ '~ ~ ._ ~ ,. ~ N N W W A Rye o 0 0 0 ° o o • • 2008 June's PCU #4 Storage Well Monitoring Report Page l of 1 • Regg, James B (DOA) From: Greenstein, Larry P [Greensteinlp@chevron.com] Sent: Tuesday, July 08, 2008 11:56 AM ~~ ~ 71 i~l2~J~~ To: Maunder, Thomas E (DOA); Regg, James B (DOA) Cc: Orr, Gary A.; Winslow, Paul M Subject: 2008 June's PCU #4 Storage Well Monitoring Report Attachments: Master Well List TIO Report 2008 06 30.x1s Hi Tom & Jim, Here is June's monthly report for the wells requiring pressure monitoring for the PCU #4 storage reservoir. PCU #4 continued with injection last month which shows up nicely as a slow increase in wellhead pressure. There was some gas production from the PC #2 well last month. Per the attached plots, I don't see any indication that any stored gas is not being contained in the approved storage area. Larry «Master Well List TIO Report 2008 06 30.x1s» 7/15/2008 Pressure _ ~ N ~ OD N W O O O O O O O 3/31 /08 ~ , ~ 4/03/08 - 4/06/08 ~ ~ I I I I 4/09!08 p o c w C° v' ~' 4/12/08 l - - ~ ~ o ~~ c~ w ~ ~ 0° i a i : 4/15/08 ~ _._ - _ ~ 4/18/08 4/21 /08 ~ b 4/24/08 ' p i 4/27/08. ~ ~ ~ "'! 4/30/08 ~ `` ~ 5/03/08 ~ ~ ~ ~ """~" CD 5/06/08 ~ ~ i ,~,~,.~~. 5/09/08 -~ j 5/12/08 <; ,~.r ~D 5/15/08 ~ 5/18/08 ' i--] ~. 5/21 /08 ~ 5/24/08 j i ~ 5/27/08 ? ~ ~ 5/30/08 ! i ~ j ~ 'i b 6/02/08 ~ j 6/05/08 ~ 6/08/08 6/11 /08 6/14/08 6/17/08 ~ 6/20/08 ~~ 6/23/08 ' I 6/26/08 6/29/08 ' O ~ N W A U1 O O O O O Rates p p p p rte' 1 ~~ L~ -~. C~ -~ U~ • • Pressure 0 0 0 0 °o 0 0 0 0 0 0 0 0 . .~.. 3/31 /08 I I _. . 1 _ -- 4/03/08 I I ' 4/06/08 o o ~ ~ _ w \, ~i 4/09/08 ' ~ ~• ~ w ~ ~ 4/12/08 °- - - - !, 4/15/08 ' j ~i 4/18/08 4121 /08 ~~ ~ w b 4/24/08 p t 4/27/08 ~ ~ q b 4130/08: ` ~ 5/03/08 ~ j ~ ~ 5/06/08 - ~ ~ ~ 5/09/08 ~ j ~ r~ y 5/12/08 ~ j ~ i ~ 5/15/08 ~ ~' ~ 5/18/08 ( ~ ~"~ ! ~. 5/21 /08 ~'D 5/24/08 ~ ~ . ~' i ~ ~ '.~ 5/27/08 5/30/08 r~ 6/02/08 6/05/08 '`' N 6/08/08 6/11 /08 i 6/14/08 ~ 6/17/08 6/20/08 6/23/08 6/26/08 6/29/08 -~ N N W W ? Rye o 0 0 0 ° o o • • C'~ ~~- ~~ 2008 May's PCU #4 Storage Well Monitoring Report • Regg, James B (DOA) From: Greenstein, Larry P [Greensteinlp@chevron.com] Sent: Monday, June 02, 2008 4:32 PM To: Maunder, Thomas E (DOA); Regg, James B (DOA) ~~~ Cc: Orr, Gary A.; Winslow, Paul M ~,~~~~~ Subject: 2008 May's PCU #4 Storage Well Monitoring Report Attachments: Master Well List TIO Report 2008 05 31.x1s Hi Tom & Jim, Page 1 of 1 Mere is April's monthly report for the wells requiring pressure monitoring for the PCU ##4 storage reservoir PCU #4 started up some injection last month which showed up nicely as'a sfaw increase in wellhead pressure. There was only some minor fuel gas production for facility purposes from the wells last month. Per the attached plots, I don°t see any indication that any stored gas is not being contained in the approved storage area, Larry «Master Well List TIO Report 2008 05 31.x1s» 6/6/2008 Pressure O O O O O _ _ OD O N ? O O O O O O O O O O O O O 2/29/08 ~ ~ ! i I: ~ ! I _ _~ 3/03/08 , 3/06/08 i I I I I i 1 3/09/08 ~ ~ ~ o o c w~ ~_ ~ I 3/12/08 ~ ; I -D v ~' ~ ? ~ oo = o a 3/15/08 3/18/08 ~ ~ - ~ ~ ~ ~, ~ a 3/21 /08 ' ~ ~ I 1 ~ I I 3/24/08 I I ~ ' ~ I ` , .r j 3/27/08 I I ~ ~ I 3/30/08 I j I i ! j ~ ~ j I ~ I 7 ~ 4/02/08 ' ~ I t C ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ 4/05/08 ' ! I i ! ~ ~ ~` 4!08/08 I ~ I I 4/11 /08 ~ j ! ~ ~ ~ ~ ~ 4/14/08 ~ ~ ~ ~ ~ C ! I ~ 4/17/08 ~ ~ ~ ~ ' I _ ~] ~~ ~ /08 I I ~ ~ ~• ~ 4/20 ~ ~ u' ~ 4/23!08 j ( ~ ~ i ~ ~ ~ ! ! ,, i 4/26/08 ~ ~ I I ~ /29/0$ 1 ~ ~ ~ ~ ..r i ~ I 1 ~ v: ~ r 5/02/08 " ~ 5/05/08 ~ i .~_~..'~:,,.~,,, ~ ~ ~ 5/08/08 ' j . I ~ 5/11!08 ' I I I I I 5!14/08 ' , ~ I I 5/17/08. i ~ ] ~ 5/20108 1 5/23/08 ~, j '~I I 5/26/08 'i I ~ ~ 5/29/08 ~ I , ~ ~~ O ~ ~.~ N W p es O 0 o R at o 0 • • Pres sure N ~, O O O O O O _ _ O N O O O O O O O O O 2/29/08 ~ ~~ I : ~ . 3/03/08 ~ 3/06/08 ~ 3/09/08 3/12/08 `~ 3/15/08 ' j i ~ 3/18/08 - _- _._- ( ~ ~ ~' 3/21 /08 ~ o w C° ~ ' 3/24/08 ~ i _ '~ ~ ~ i ~ ~ C ~, 3/27/08 ~ rb ~ 3/30/08 I ~ ~ ( ~ 4/02/08 ~ ~ ~ C 4/05/08 ~ ~ ! ~ ` ~ 4/08/08 4/11/08 ~ ~ ' I ~ ~ ~ 4/14/08 I ~ !, 4/17/08 ~~ y 4/20/08 ~„ ' ~ " c'D 4/23/08 _ ~ i i 4/26/08 j rC 4/29/08 ~ ~ '^^ C ~ { b 5/02/08 ('~ ~ 5/05/08 ~ N 5/08/08 i I I i I 5/11/08 ~ 5/14/08 ~ ~ ~ I 5/17/08 I 5/20/08 ~ i I I 5/23/08 5/26/08 5/29/08 ' S o o o 0 0 i 0 0 o R te 0 i 2008 April's PCU #4 Storage Well Monitoring Report • Regg, James B (DOA) From: Greenstein, Larry P [Greensteinlp@chevron.com] Sent: Monday, May 05, 2008 7:55 AM °'~ ~ S' I~O~ To: Maunder, Thomas E (DOA); Regg, James B (DOA) \ ~~ Cc: Orr, Gary A.; Winslow, Paul M Subject: 2008 April's PCU #4 Storage Well Monitoring Report Attachments: Master Well List TIO Report 2008 05 01.x1s Hi Tom & Jim, Page 1 of 1 Here is April's monthly report for the wells requiring pressure monitoring for the PCU #4 storage reservoir. There wasn't any production or injection last month at Pretty Creek. The pressures have remained very steady, as expected. Bottom line, 1 don't see any indication that any stored gas is not being contained in the approved storage area. Larry «Master Well List TIO Report 2008 05 01.x1s» 5/15/2008 • • 0 ~ ~ O ~ aop ~ ~ N O O B" d' U a v v .~ E~ G~ ,Lr a~ ^^~I~ FBI +.d a F y ~ f ~ ~ i i i ~ i t f ~ ~ ~ p ~ o rn ~ ,~ ~ fh ~ M 7 ~ ~ ~ I ; ; N ~ ~ I I r j _ _ __ 80/LZ/t 80/8 l/ti 80/5 l/b 80/Z 4 ~ti( 80/ ~ 8o/s 80/9 80/E 80/0 80/L 80/ ~ 8o/s 80/5 8o/z Pres sure 0 0 0 0 0 0 0 0 0 °o 0 0 0 1 /31 /08 k. 2/03/08 ~ ! 2/06/08 i ~ - - _-- I 2/09/08 ' I N ~ ~ ~ ~ O C O W (.T1 ~I ~ 2/12/08 W ~ ~ - 2115/08 I ! ~ 00 - - i 2/18/08 2/21 /08 ' ~ ~ ( r 2/24/08 ~ ! `'d "'r ~ i O ,..r 2/27/08 ', I '' ~ 3/01 /08 ~ I I ~ ~: ~ F ~ x 3/04/08 - ~ ( ~ ~ ' ~ ~ ~ 3/07/08 , ~ i 3/10/08 3/13/08 '~ I ~ ~ '-` 3/16/08 C 3/19/08 ~ / 2/08 ! 3 2 ~ ~ i ~ CD 3/25/08 ~ ' ~ ~ ~ ~ cc ~ 3/28/08 I C ~D 3/31 /08 ~ ~ ~ ~ I ~ b 4/03/08 ~ i I 4/06/08 ~ f I ~ N 4/09/08 ~ 4/12/08 4/15/08 ~ ~ ~ t ~ 4/18/08 ! 4/21 /08 % ~ ! I 4/24/08 ! 4/27/08 ' ! ! i 4/30/08 ~ ~ ~ I O ~ N W l~ C o T O) o V Oo 0 0 c0 ~ 0 0 0 0 0 R abe 0 • • 2008 March's PCU #4 Storage Well Monitoring Report Page 1 of 1 Re James B DOA • g9~ ~ From: Greenstein, Larry P [Greensteinlp@chevron.com] Sent: Friday, April 04, 2008 12:24 PM To: Maunder, Thomas E (DOA); Regg, James B (DOA) Cc: Orr, Gary A.; Sauve, Jeff ~ ~~ ¢I7Jd~3 Subject: 2008 March's PCU #4 Storage Well Monitoring Report Attachments: Master Well List TIO Report 2008 03 31.x1s Hi Tom & Jim, Here is March's monthly report for the wells requiring pressure monitoring for the PCU #4 storage reservoir. There wasn't any production or injection last month at Pretty Creek except a little produced gas out of PCU #2. The pressures have remained very steady, as expected. Bottom line, I don't see any indication that any stored gas is not being contained in the approved storage area. Larry «Master Well List TIO Report 2008 03 31.x1s» 4/4/2008 Pressure ~ 1 ~ ~ O O O O O O O O O 12/31 /07 _ __ 1 /03/08 ~ I I 1 /06/08 ~ o g~ w c~ ~ 1 /09/08 ~ ~ n .?. ~ ~ ~ o0 1/12/08 ~~ 1/15/08 -- 1 /18!08 , 1121/08 ': ~ 1 /24/08 ~~! _ O 1 /27/08 ~ ~ 1 /30/08 ": ~ 2/02/08 ' O ~ 2/05/08 '; 2/08/08 ~ ~~, ~ ~, 2/11 /08 ,~.~. 2/14/08 r C 2/17/08 ~ ~ y ,..' 2/20/08 rD 2/23/08 ~ z 2/26/08 2/29/08 I ~ C , ~ 3/03/08 3/06/08 r, 3/09/08 3/12/08 3/15/08. ~; 7 3/18/08 x; 3/21 /08 r ~\ 3!24/08 ~ ~ ' 3/27/08 `, ~ ~ 3/30/08 p ~ 0 N W .A CT 0 0 o p° p o V 0 00 p 0 0 ~ 0 R~ {g 0 • • Pressure O O O O O O O O O O O N O O 12/31 /07 1 /03/08 1 /06/08 1 /09/08 v ~ I 1 /12/08 ' o ~ o_ w ~ ~ _ 00 ~ ~ 1/15/08 ~ co _ 1/18/08 1/21/08 b 1 /24/08 ~ p 1 /27/08 ~ ~ ~ "~ 1 /30/08 r ~ ~ 2/02/08 ~ ,~ ~D 2/05/08 2/08/08 2/11 /08 ~ 2/14/08 ~ 2/17/08 ' ~"'~ . ~ 2/20/08 ' ~ 2/23/08 ` ~ 2/26/08 ~ ~p 2/29/08 ~ ~ 3/03/08 3/06/08' N 3/09/08 3/12/08 M 3/15/08 3/18/08 3/21 /08 ; ;- ~ \ Y, 3/24/08 `; ~~ 3/27/08 ..A-- ~~ ~ ~~ 3130108 ' %' -~'~ p ~ N O O W A (T O O R~ O v O O O O (O O ~ O O • • 2008 February's PCU #4 Storage~ll Monitoring Report Regg, James B (DOA) Page 1 of 1 From:. Greenstein, Larry P [Greensteinlp@chevron.com] n, ,~I Sent: Tuesday, March 04, 2008 1:26 PM ~~~ To: Maunder, Thomas E (DOA); Regg, James B (DOA) Cc: Orr, Gary A.; Sauve, Jeff Subject: 2008 February's PCU #4 Storage Well Monitoring Report Attachments: Master Well List TIO Report 2008 02 29.x1s Hi Tom & Jim. Here is February's monthly report for the wells requiring pressure monitoring for the PCU #4 storage reservoir. There wasn`t any injection last month again at Pretty Creek. We mostly used the PCU #4 storage well early in the month ~ due to the cold weather. The pressures responded as expected. Bottom line, I don't see any unexplained indication that any stored gas is not being contained in the approved storage area. Larry «Master Well List TIO Report 2008 02 29.x1s» 3/12/2008 Pressure 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 11 /30/07 -- 12/03/07 ~ ~ ( 12/06/07 " I ~ ~ < < ~ ,~ ~ ~; 12/09/07 I ~ ` ~"' ~ ao ~ o °~ °D- ~ 12/12/07 ~ ~ j i i 12/15/07 ~ ~ _ _ ~ _ ~ I ' ~ ~ ' 12/18/07 1/07 ` ~ / i ~ ~ ~ I i 12 2 I y ~ 12/24/07 I '~ j ~ p I ~ ~ ~ 12/27/07 j I I ~ i I 1 I j 12/30/07 ~~ ' i ~ ~ f ~ ~ ~ ~ ~ ~ 1 /02/08 i i ~ ~ ~ ~ ~ ~ ; I ~ i I i 1 /05/08 I ~ 1 /08!08 i 1/11/08 ~ ~ ' ~ A7 ~ ~ 1 /14/08 l ~ , ~ ~ i . F 1/17/08 I ~ ~"'~ ~~ j ~.. 1 /20/08 ~ 1 !23/08 ' ~ ~us.• 1 /26/08 ! ~ ~ ~ ~ ~ ~ ~ ~ j ~ ' ', ~ ~ " "" 1 /29/08 ~~ i~ w ~ 2/01 /08 ', 2/04/08 - i 1 ; 1 I ~ ~ 2/07/08 ~ I~ ~ I! 2/10/08 I ~ 2/13/08 ~I 2/16/08 2/19!08 ~ ', ~ j ~ ~ ~' 2/22/08 I ~ i 2/25/08 '~ E j i 2/28/08 ' ~ 4 ~.. I I o _ ~ 0 N. .. _(A A tT 0 0 o i p ~ v p p o 0 0 ~ 0 te R 0 ~1 SL ~ W • • Pres sure ~ O O O p p p O O O J O O O O 11 /30/07 A: _ , 1 12/03/07 ~ ~ I ~ 12!06/07 ' ~ ~'c ~ o ~ _ w cn i > 12/09/07 r' ~ ~ ~ ~ ~~ 12/12/07 I -~ 12/15/07 l 12/18/07 i 12/21 /07 ` b 12/24/07 ~ I ~ q i 12/27/07 b 12/30/07 ' i ! ~ 1 /02/08 ~ C b ~ ~ CD 1 /05!08 ~ ~ i 1 /08/0$ ~ r~ i ~ ~ ! ~ i ~ ~ 1/11/08 _ ~ ~ ^ ~ i 1 /14/08 ' ' ' i < ~ ' y ~ I 1/17/08 i j ~ ~ ~-] i 1 l 1 /20/08 ~ ~ i ~ ~ 1 /23/08 ~ j I ~ ti ~ ~ U 1 /26/08 ~ ~ rD ~ ~ ... ~ ~ 1 /29/08 ~ ~ ~ ~ ~ 2/01 /08 ' r n 2/04/08 ' { ~ ~ I a ~ N 2/07/08 ' ~ I ~ y; 2/10/08 ~~ ~ i I + 2/13/08 ' d 2/16/08: 2/19/08 I 2/22/08 ' ^ 2/25/08 ~ ~ 1 ri 1 2/28/08 "~ ..u.,,,...,....,,~.~.,.~,,._._«~~+~,~-err- ... .. .... ,~. .. _.. ,. p ~ N w ~ °o °o o °p R (T p °o it V W °o °o p -• °o °o e 0 ~1~ VY ~o • • 2008 January's PCU #4 Storage .Monitoring Report • Page 1 of 1 Regg, James B (DOA) From: Greenstein, Larry P [Greensteinlp@chevron.com] f Sent: Monday, February 04, 2008 3:04 PM~~ q ~1~ ~~ To: Maunder, Thomas E (DOA); Regg, James B (DOA) '1 (, Cc: Orr, Gary A.; Sauve, Jeff Subject: 2008 January's PCU #4 Storage Well Monitoring Report Attachments: Master Well List TIO Report 2008 01 31.x1s Hi Tom & Jim, , Here is January's monthly report for the wells requiring pressure monitoring for the PCU ##4 storage reservoir. There wasn`t any injection last month again at Pretty Creek. PCU #2 did produce some gas; but it may be the last fora ,~ while. We used PCU 4 storage well for a few more days late in the month due to the cold weather. The pressures responded as expected, Bottom line, I don't see any unexplained indication that any stored gas is not being contained in the approved storage area. Larry «Master Well List TIO Report 2008 01 31.x1s» 2/4/2008 Pres sure 0 0 0 0 0 0 0 0 °o 0 0 0 0 0 0 0 0 11 /01 /07 i ~- ~ 11/04/07. ~ ~ ~ ~ ~, ~ 11/07/07 ~ ~ ~ ~ ~ ~ ~ ( ~ 11/10/07 j ~ ~ ~ o ~ a~ w cfl ~! 11/13/07 ~ ~ o . ~• ~ 0D ~ ~~ n 11 /18/07 - ~ ~ / 7 I 1 ~ ~ ~ 11/19 0 ~ ; 11 /22/07 ~ ~ ~, i i ~ ~ ~ b 11/25/07 ' ,' ~ ~ ..+ i ' { y ~ 11 /28/07 j T ~ ~ 12/01 /07 ' ~ ~ v~ 12/04/07 1 I i ~ ~ ~ 12/07!07 ' ' ~ ~ 12/10/07 i i 1 ' ' ~ ~ '~ 12/13/07 ~ i ~ ' ~ ~ ~ ~ ~ 12/16/07 ~ t 12I191Q7 ~ ~~ j ~ I ~ ~'~ ~] ~. 2/22/0 ~ I ~ q ~ 12/25/07 1 i i ~ ~ ~ 1 ~ ~! 12/28/07 ~ ~ ~ i i ' rp 12131 /07 ~ a ~ I ~, ~G 1 /03/08 ~ ~ ~ ~ ~ ~ ~ i )1 /06/08 ~ ~ 1 /09/08 ~~'~ ~ ' ~ I ~ ~ ~ 1112/08 ' ~ ! I 1 /15/08 . """/ ~" ,;. i 1118/08 I 1 /21 /0>? ' ' 1 /24/08 '' 1 /27/08 ? i ' ~ 1/30/OS ~ ~ ~ ' r O O O O O O n b O O G O O O O O Q O R ~ O ~ ~~ • Pressure 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 11 /01 /07 _-._ x, 11 /04/07 I ~ i 7/ 7 11/0 0 ~ i ~ i ! o N ~ cfl `. o w ~ _ cn 11 /10/07 { ! ~ ~ ~ ~ cn n . 11/13/07 ! I ! 1 _ ~ x. 11/16/07 '' ~ ~ i 11/19/07 I, 11 /22/07 ~ i-~ 11 /25/07 ,~ ~~ 11 !28!07 ' ib ~ "~ 12/01 /07 ' ~ ; l ~ ~ i~ 12/04/07 i ~ i ` ,~ ~ C 12/07/07 'i 2/10/07 ~ ~ 12/13/07 j ~ ~ i 1 ; ~ 12/16/07 I ~ I I ~ I 12/19/0' '~ ! ~ ~ ~ ~] . ~ ~ j ~ I ~ 12/22/07 ~ ~ ~ 12/25/07 ' ~ ~ ~ ~ ~ ~ y 12/28/01 I ~ ~ ~~ ~ ~ ~ y rr 12131 /07 ~ I ~ ' i ~ ~ /03/08 ~ ~~ ', C'" 1 /06108: ~ ~~~~ ~~ laa 1 /09/08 ' 9/12/08 ~ ~ I 1/15/08 - ~~ l 1/18108 I ~ I `~ l 1 /21 /08 ~ ~ I ~ I 1 /24/08 - ~, ~ I ~i27/08 0 ~ '~ ~ j 1/30/08 ~~ -,~.-.-.' .,~~. ~ , Rite ~ ~ ° 0 0 ~~ Q • ~' 32 2007 December's PCU #4 Storag~ell Monitoring Report Page 1 of 2 Re James B DOA • J9, ( ) From: Greenstein, Larry P [Greensteinlp@chevron.com] Sent: Thursday, January 10, 2008 8:30 AM To: Maunder, Thomas E (DOA) Cc: Regg, James B (DOA) Subject: RE: 2007 December's PCU #4 Storage Well Monitoring Report Hi Tom, The PCU #2 well has been a real problem to keep flowing. A number of the pressure changes have been related to trying to kick the well off or keep It going at rates that are below the unloading rate. Bleed downs and soap sticks are the most common attempts. They don't always work, so the well has shown a number of pressure changes that resulted in no 'production' from the well. It is confusing to me too, but it looks like they got some produotion from the wel! the first week of January, which you will see in next month's plots. There may also be a couple of typos mixed in #here to further cloud the issue. It isn't a pretty plot by any means. I do believe they are getting all the estimated production data entered into the database daily, but there have been omissions in the past. I"ll walk back through the morning reports to take a peek. We sure wish the well was stronger to produce a much cleaner looking plot each month, Larry From: Maunder, Thomas E (DOA) [mailto:tom.maunder@alaska.gov] Sent: Thursday, January 10, 2008 8:18 AM To: Greenstein, Larry P Cc: Jim Regg Subject: RE: 2007 December's PCU #4 Storage Well Monitoring Report Thanks Larry, Looking at the charts, it appears that the rate info is out of sync with the pressure data and that maybe some rate information is missing from the PCU 2 data. On PCU 2, I would expect to see some production given the large pressure change about October 21 and the "chatter" following. The information for PCU 4 looks more reasonably matched in time. Can you and your colleagues reconcile? Tom Maunder, PE AOGCC From: Greenstein, Larry P [mailto:Greensteinlp@chevron.com] Sent: Thursday, January 10, 2008 8:06 AM To: Maunder, Thomas E (DOA); Regg, James B (DOA) Cc: Orr, Gary A.; Sauve, Jeff Subject: 2007 December's PCU #4 Storage Well Monitoring Report Hi Tom Jim. Here is December's monthly report for the wells requiring pressure monitoring for the PCU #4 storage reservoir. There wean°t any injection last month again at Pretty Creek. PCU #2 did have some more production and we also used PCU #4 storage well for a few days in December. The pressures responded as expected. 1;10/2008 2007 December's PCU #4 Storag~ell Monitoring Report Page 2 of 2 Bottdm line, 1 don't see any unexplai indication that any stored gas is not bein~tained in the approved storage area_ Larry «Master Well List TIO Report 2007 12 31.x1s» 1/10/2008 Pressure J 0 0 ~ ~ 0 ~ Q 0 J ~ ~ 0 ~ 0 9/30/07 3 10/03/07 ~ I 10/06/07 r 10/09/07 n y 10/12/07 ~ _; 10/15/07 z ~ I I 10/18/07 ~ ~ o ~ o w = CO ~' t 10/21/07 ~ ~ I g w ao °D ' o ~ ~ 10/24/07 ~ Q- ~ ~, p - 10/27/07 ~ I ,; ~ ~ 10/30/07 ' ! ~ 11 /02!07 ~~~ ~ ~ ~' ~ Y I "~! 11 /05/07 ' I I ~ 11 /08/07 1€ ~~ ' ' 11 /11 /07 I ~ ~ 11 /14/07 ~ ~ ~~ ti C 11/17/07 r i y ... 11 /20/07 ~; ~ 11 /23/07 ~ 11 /26/07 11 /29/07 u 12/02/07 ~ 'r 12/05/07 ~ j ' N 12/08/07 '12/11/07 F 12/14/07 x 4 12/17/07 12/20/07 12/23/07 12/26/07 12/29/07 ' ` ' a ~ Q i ~ ~ o 0 R te 0 0 • • • • ~' V i . ^., E-~ 7 L i a r.., O °o o °o °o °~}~~ °o °o °o °o ~ pOp ~ ~ ~ ~ M N ~ O LO/6Z/Z t LO/9Z/Z L LO/£Z/Z ~ LO/OZ/Z 6 LOIL l/Z ~. LOIb l/Z R. LO/ L WZ L LO/80/Z 4 LO/50/Z ~. LO/ZO/Z L LO/6Z/ L L LO/9Z/ 4 4 LO/£Z/L L LO/OZ/ L 6 LO/L L/ 6 t- LO/ti W L t LO/Ll/LG LO/80/ L t LO/50/ L L LO/ZO/ L L LO/0£/0 l LO/LZ/0 L LO/~Z/0 L LO/ L Z/0 L LO/8 L/0 L LO/5 L/0 6 LO/Z l/0 L LO/60/0l LO/90/0 L LO/£0/0 L LO/0£/6 0 (00 ~ N O COO COO ~ N ~ r r r aanssaad . 2007 November's PCU #4 Storag~ell Monitoring Report . Page 1 of 1 Regg, James B (DOA) From: Greenstein, Larry P [Greensteinlp@chevron.com] ~P~e; )~~~ ~ ~ 0 .~ Sent: Wednesday, December 05, 2007 8:59 AM To: Maunder, Thomas E (DOA); Regg, James B (DOA) Cc: Orr, Gary A.; Sauve, Jeff Subject: 2007 November's PCU #4 Storage Well Monitoring Report Attachments: Master Well List TIO Report 2007 11 30.x1s ~ • Hi Tom & Jim. Here is November`s monthly report for the wells requiring pressure monitoring for the PCU #4 storage reservoir. There wasn't any injection last month again at Pretty Creek. PCU 2 did have some more production, but it has been ,,,~' spotty. We'll keep trying to get this well to flow better. Bottom line, l don't see any unexplained indication that any stored gas is not being contained in the approved storage area, Larry «Master Well List TIO Report 2007 11 30.x1s» 12/6/2007 Pressure O N A W 00 O O O O _ _ O N O O _ A O _ O O 8/31 /07 ~ -- 9/03/07 ~ I 9/06/07 p C s ~ N ~ O W 9/09/07 w ~ ~ oo i 9/12/07 ~< ' 9l15/07 ~ ~ ~ ~ - ~ - I 9/18/07 9/21 /07 s 9/24/07 ~ ~ O 9/27/07 ~ rb "~ 9/30/07 ~ 10/03/07 # ~ ~ 10/06/07 10/09/07 10/12/07 10/15/07 ~ ~ 10/18/07 ~] ~ ~ 10/21 /07 10/24/07 ~ ~ 10/27/07 CD f, ~_ 10/30/07 ~ r 11 /02/07 ~ 11 /05/07 ~ ~ N 11 /08/07 11 /11 /07 >. 11 /14107 "" 11 /17/07 f 11 /20/07 H a- ~` 11 /23107 r ~. 11/26/07 ~~ 11 /29/07: o o n o ~ Rite 0 0 • • ~~ N ~- Pressure S o o S o 0 0 0 o 8/31 /07 ~ ~ 9/03/07 ~ ~ ~ ~ ~ ~~ 9/06/07 r _ ~~~ _ 9/09/07 ~ ~ 0 0 ~ ~ 9/12/07 ~ w cn w ~ - 9 i N ~p 0D 9/15/07 ~i - - 9!18/07 ~ ~ 9/21 /07 ~ ~~ ~ '~i b )9/24/07 ~ ~ O ~ ~ ~ ~ 9/27/07 . ~ ~~ -b 9/30/07 ~ I ' ~ z ~ ~ 10/03/07 , ~, ~ 10/06/07 m 10/09/07 I ~ ~ ~ '10/12/07 % , i ~ 10/15/07 ~ 10/18/07 10/21 /07 , I f 10/24/07 ~ I 10/27/07 ~ ~p I i C 10/30/07 f ~~ rb n 11 /02/07 i I ~.~ 11 /05/07 ~ ~ 11 /08/07 y 11/11/07 t 11/14/07 11 /17/07 r 11 /20/07 ' 11 /23/07 11 /26/07 ~ 11 /29/07 ~ r ° o 0 0 o Rye o 0 0 0 0 • • ~d N G v 2007 October's PCU #4 Storage~ll Monitoring Report • Regg, James B (DOA) Page 1 of 1 From: Greenstein, Larry P [Greensteinlp@chevron.com] Sent: Monday, November 05, 2007 11:15 AM ~~~ 7 r]~S I~~ To: Maunder, Thomas E (DOA); Regg, James B (DOA) Cc: Orr, Gary A. Subject: 2007 October's PCU #4 Storage Well Monitoring Report Attachments: Master Well List TIO Report 2007 10 31.x1s Hi Tam & Jim, Here is October's monthly report for the webs requiring pressure monitoring for the PCU #4 storage reservoir. There wasn't any injection last month again at Pretty Creek. PCU #2 did get perforated, but didn't lank too good. Had ,/f enough pressure to supply the fuel gas, but couldn't keep flawing against the backpressure of the pipeline and didn't have the rate to start up the compressor. We'll keep trying to get this well to flaw better. Bottom line, I don't see any unexplained indication that any stored gas is not being contained in the approved storage area. Larry «Master Well List TIO Report 2007 10 31.x1s» 11/5/2007 Pressure o~ °D °o 0 0 0 o °o °0 0 0 0 0 0 0 ~ ~ 8/01 /07 _ ~ , ~ I 8/04/07 ~' I i ~ ~ ` fin.-,' 8/07/07 ~ I ~ ~ ~ ~ ~ I ~ ~ ~ i ~~I 8/10/07 ~ ~ o_ o ~ w _ ~ '~ cn - 8/13/07 ~ ~ ~ N co w 0D I I ~ ,- 8/16/07 ' i i ~ -- ~ - I ~ 8/19/07 8/22/07 ~ ~ j ~ ~ ~,.~ 1 ~ ~ O 8/25/07 i i n' ~ 8/28/07 I ~ ~ , ~ ~ ~ ~ 8/31 /07 ~ ~ ~ I ~ ~ 9/03/07 ' ~ ~ ~ ~ ~ i ~ ~D 9/06/07. ~ ~ ~p 9/os/o7 ~ ~ 1 j ~ ~d 9/12/07. ~ ~ ;. ~ i 9115/07 ~ ~ ~ ~ i 9/18/07 ; ~ 9/21 /07 ~ ~ I °' ~ 91'24/07 1 1 9!27/07 ' ~ ~ `;. i °; ~.. 9/30/07 ~ ~ b i ~ ~ n 10/03/07 I i 10/06/07 ~' ~ ~ 'p 10!09/07 10/12/07 ~ I 10!15/07 t 10/18!07 ' i I 10/21 /07 10/24/07` i 10/27/07 i 1 ! i 10/30/07 a ° No $ o 0 Rite o 0 0 0 0 • • Pressure O N O O 00 O O O _ ? O O O O O O 8/01/07 ~ ~ ; 8/04/07 ~ i ~ ? ~ ~ F ~ ~ l 8/07/07 ," I ~ l ' 8/10/07 -5 ~ i J ~ N c o ~ w , ' ! 6 U, w ao , ',, 8/13/07 ' ~ ~ ~ ~ °°_ = J _ _ 8/16/07 ~ i ~ 8/19/07 ~ 'I ~ a/22/o7 ~ 1 ~ j I c 8/25/07 ' ~ ~ I I ;: ,..r i 8/28/07 '~ I 8/31 /07 _ ~ ~ ~ ~% ~ 9/03/07 ~ , j ~ ~ ~ ~ ~ 9/06/07 ~ I i I I 9/09/07 ' ~ 9!12/07 ` C ~ 9/15/07 ~ ~ ~ 9/18/07 ~ I I l i ~~ CD 9/21 /07 ~ ~ I ~ 9/24/07 1 I 9/27/07 j ' ~ ~ i C 9/30/07. ~ i ~ ~~ i 10/03/07 ~ ~ ~ i N 10/06/07 ~ ~ I 10/09/07 10/12/07 '' ~ ~ 10/15/07 ~ ~ ~~~ ~~ ~ 10/18/07 ~ j 10/21 /07 ' ~i 10/24/07 10/27/07 10/30/07 ~ ~ i.1 5~ o' J • • 2007 September's PCU #4 Storaell Monitoring Report Page 1 of 1 Regg, James B (DOA) From: Greenstein, Larry P [Greensteinlp@chevron.com] Sent:. Thursday, October 04, 2007 7:54 AM ~~~ ~{ l~ ~ ~~~ To: Maunder, Thomas E (DOA); Regg, James B (DOA) t Cc: Orr, Gary A. Subject: 2007 September's PCU #4 Storage Well Monitoring Report Attachments: Master Well List TIO Report 2007 09 30.x1s Hi Tom & Jim, Here is September's monthly report for the wells requiring pressure monitoring for the PCU #4 storage reservoir. There wasn't any injection or production volumes at Pretty Creek last month and the pressures are looking fairly stabie. The PCU #2 well is scheduled to be perfed soon and it is getting colder, so Pretty Creek pad will be producing some gas fairly quickly. Bottom line, I don't see any unexplained indication that any stored gas is not being contained in the approved storage area. Larry «Master Well List TIO Report 2007 09 30.x1s» I 1'r 10/4/2007 Pres sure ° ° ~ ° ~ 0 ° .1 0 o 0 0 0 o o 0 7/01/07 - i j ~ 7/04/07 I 7/07/07 ' 7/10/07 , I I ~ I I I ', j ~ J 0 0 ~ w cn = ' ~; 7/13/07 ; ~ 7/16/07 i, ~ - ~ ~- - ~ 7/19/07 ~; 7/22/07 '"d 7/25/07 ~~~ ~ .r ~ , 7/28/07 ' ~ I ~ I 7/31 /07 C 8/03/07 f ~ ~'D 8/06/07 i 8/09/07 " I I ;- ~ ~ 8/12/07` ~ ~ j CD 8/15/07 ' ~ i ~ ~ C ~ 8/18/07 ' ~ i ~ ~ ~ ~' ~ 8/21 /07 ~ ~ ,, rp ~ ~~ ~ 8/24/07 ~ '~ I ~ ~ :< 8/27/07 ~D 8/30/07 ~ I 9/02/07 9/05/07 1 9/08/07 i 9/11/07 9/14/07. 1 ' 9/17/07 9/20/07 ~ ~ ~ i 9/23/07: 9/26/07 9/29/07 " ', '~ ° o $ o o R ye o 0 0 0 0 r • m "~ ~ ~` l ~--1 ~- v Pressure -~ rv w ~ cn o~ ~ w co 0 o °o °o °o °o °o °o °o °o o °o ~,~,~r . /07 7/07/07 7/10/07 7/13/07 X07/19/07 7/22/07 ~D7/28/07 7/31 /07/31 /07 i i i i ~ - -= -i ~'~ i i I ~ N~ c o I c o w ~ I ~ ~ OD ', r ~ w ~ o i ~ I i i ~ j j I I i I I i ~ i I i ~ ~ ~ 0 2/07 5/07 8/07 1 /07 /07 1 /07 4/07 7/07 ~ ~ I I I b 0 b C "~ A7 C y ~. 'b N n r-- G J • • 2007 August's PCU #4 Storage WMonitoring Report Page 1 of 1 Regg, James B (DOA) From: Greenstein, Larry P [Greensteinlp@chevron.com] Sent: Thursday, September 06, 2007 9:15 AM ~ ~ ~~ IG~ To: Maunder, Thomas E (DOA); Regg, James B (DOA) ` `~~~ Cc: Orr, Gary A. Subject: 2007 August's PCU #4 Storage Well Monitoring Report Attachments: Master Well List TIO Report 2007 08 31.x1s Hi Tom & Jim, E-lere is August's monthly report for the wells requiring pressure monitoring in the PCU 4 storage reservoir. There was no injection or production volumes at Pretty Creek last mon#h and the pressures are looking fairly stable. Battom line, I don't see any unexplained indication that any stared gas is not being contained in the approved storage area. Larry «Master Well List TIO Report 2007 08 31.x1s» 9/7/2007 O /07 0/07 3/07 9/07 /07 /07/07 /10107 '/13/07 '/16/07 '/19/07 '/22/07 '/25/07 2/07 8/07 1 /07 Pressure N A O W O N A O O O O O O O O O O O ''d O ~"d r~yD., ~G" A~ C ~. i CD r..+ n A c4 G =-~ ~~ J • ~ ~ ~ N N W W A A CT O O O O O ~ O O O O O O O O R~e O O O O o Pres sure -• N W ~ O CT O 0 O 1 V OD c0 O O O O O O O O O 6/01 /07 L + i ~ 6/04/07 ~ i 1 { i i ' ~ ~ ~ -- , 6/07/07 ~ , I 6/10/07 j ~ ~ ~ ~ i N ~ ~I ~ ~ I ~ ~ o_ w Q W ~ i I 6/13/07 ', ~ ~ ! ~~ oo °D-' + -~° i 6/16/07. ~~ I' ~ ' f 6/19107 i i j 6/22/07 i i ~d 6/25/07 = ' 1 ~ j I ~ O ~ I + ~ ~ 6128/07 ~ ~ i ~ I ~ i ~D 7/01 /07 ~ ~ i ~ ' ~ ~ 7/04/07. { ~ ~ ~ ± I 7/07/07 ~ ; i i I I I ~ ' i 7/10/07 , 7/13/07 I j ~ i ~ I ~ ~ 7/16/07 , ~ i ~ ~ y 7/19/07 ~ ~' "'" 7/22/07 ' ~~ ~ i i ~ 7/25/07 ~ j ~ ~ ~ ~ I ~ ~ t i ~ 7/28/07 ~ ~ ~ 7/31 /07 ~ I ~ b I ~ 8/03/07 I ~ ,; N 8/06/07 '~~ ~ I ~ 8/09/07 1 i i i I ~ I 8/12/07 '. i i 8/15/07 ~~ I , i ! 8/18/07 ~ 8/21 /07 ~ i ~ ~~ 8/24/07 i i 8/27/07 ~° ~ ~ ~ ' 8/30/07 ~ i ~ ~ ~ ~~ ,° v 2007 July's PCU #4 Storage Well Ma~oring Report • Regg, James B (DOA) From: Greenstein, Larry P [Greensteinlp@chevron.com] Sent: Tuesday, August 07, 2007 11:17 AM g~ ~ ~ Q 7 To: Maunder, Thomas E (DOA); Regg, James B (DOA) ~G~ ~~ Cc: Orr, Gary A. Subject: 2007 July's PCU #4 Storage Well Monitoring Report Attachments: Master Well List TIO Report 2007 07 31.x1s Hi Tom & Jim. Here is July°s monthly report for the wells requiring pressure monitoring in the PCU #4 storage reservoir. There was no injection or production volumes at Pretty Creek last month and the pressures are looking stable. Page 1 of 1 Bottom line, 1 don't see any unexplained indication that any stored gas is not being contained in the approved storage area. Larry «Master Well List TIO Report 2007 07 31.x1s» 8/7/2007 Pressure J N A O O O O OD O O O _ ~ ~ N A O O O O O O O 4/30/07 £' 5/03/07 5/06/07 5/09/07 ~ W 5/12/07 ( ~ I I I 5115/07 li 0 _ 0 ~ W ~ ~ 5/18/07 ~ ~ =, ~ W ~ N ~ ~ r 5/21 /07 ' ~ ~ b 5/24/07 ~ '' ~ ~ m W 5/27/07 '' `' ~ ' "~! 5/30/07 ~ 6/02/07 ~ ~ 6/05/07 `' ~ 6/08/07 , 6/11 /07 ~ 6/14/07 C 6/17/07 u y ..~. 6/20/07 rD 6/23/07 ~ 6/26/07 6/29/07 - '~ ''d 7/02/07 7/05/07 7/08/07 7/11 /07 7/14/07" 7/17/07 7/20/07 ' 7/23/07 7/26/07 7/29/07 O ~ o N S W i A ~ O o o S p p R te O O o • ~D U~ f, Pressure ~ O N W A Ul O O O O O v O O O CO O O O O O 4/30/07 5/03/07 5/06/07 ~' I 5/09/07 f ~ N ~ ~ r' 5/12/07 ~ °= w co 0° 5/15/07 5/18/07 5/21 /07 i! ~` ~ 5/24/07 O 5/27/07 ± ~,, z ~ 5/30/07. v, M 6/02/07 ~ 6/05/07: ~ Qo 6/08/07 u 6/11 /07 r ~ t 6!14/07 ~ v' y 6/17/07 ' ~' 6/20/07 ~ 6/23/07 , 6/26/07 C ~ ~ 6/29/07 7/02/07 q N 7/05/07 ' 7/08/07 7/11 /07 7/14/07 7/17/07 7/20/07 7/23/07 7/26/07 7/29/07 • ~ F n ~\ ~ `J r n ~ J 2007 June's PCU #4 Storage 11 Monitoring Report Page 1 of 1 Regg, James B (DOA) From: Greenstein, Larry P [Greensteinlp@chevron.eom] Sent: Thursday, July 05, 2007 9:32 AM ,f,,~~~ To: Maunder, Thomas E (DOA); Regg, James B (DOA) ~ ~~ Cc: Orr, Gary A. Subject: 2007 June's PCU #4 Storage Well Monitoring Report Attachments: Master Well List TIO Report 2007 06 30.x1s Hi Tom Jim, Nere is June's monthly report for the wells requiring pressure monitoring in the PCU #4 storage reservoir. ~Jeither well produced in April, May or June, but a lot of gas was put into the ground. PCU ##2 shows a gradual SI tubing pressure increase which the engineer attributed to fluid level changes and a partially successful sand bailing job in mid-April and not a response from the increased gas stored in the PCU #4 well. Bottom line, I don`t see any unexplained indication that any stored gas is not being contained in the approved storage area. Larry «Master Well List TIO Report 2007 06 30.x1s» 7/10/2007 Pressure 0 0 0 0 °o 0 0 0 0 0 0 0 0 0 0 0 0 0 0 3/31 /07 /03/07 ~I ~ ( I 4/06/07 I ~`.~ w~~_ /09/07 Q o ~ w ~ - - co a ~ 4/12/07 4/15/07 /18/07 4/21 /07 b 4/24!07 O /27/07 ~ 4/30!07 ~ 5/03/07 ~ ~ 5/06/07 ~ ~D ti 5/09/07 9 5/12/07 ,~.r CD 5/15/07 ~ 5/18/07 y 5/21107 ~D 5/24/07 ~ ~ 5!27/07 3 ~ ~ 5/30/07 ~ b 6/02/07 < y 6/05/07 ~ 6/08/07 ' 6/11/07 ~ ~, ~+ 6/14/07 F 6/17/07 ~ 6/20/07 3,~ y ' 6/23/07 ~ ~ 6/26/07 `' /07 6/29 o ~ N W ~ ° U1 p V g Rate o 0 0 0 0 0 • • -~ v Pressure ~ N (+~ A C71 O V O O O 00 O CO O O O O O O O O 3/31/07 ,_ ~ 4/03/07 ~ I ~ N ~ Cfl 4/06/07 ~ °_ w ~ ~ ~ o0 /09/07 ~° 4/12/07 0 4/15/07 ~ s 6 4/18/07 4/21 /07 ~ 4/24/07 g ~ ~ ~.. C f ,..r 4/27/07 q i ~ ~~ ~ CD 4/30/07 I ~ ~' F 5/03/07 ~ ~ 5/06/07 3 5/09/07 I 5/12/07 ~ ~ ~ C ,5115/07 ~ ~ ~' ~ ~ ~ ~ i y 5/18/07 - ~. 5/21 /07 ~ ~ i 5/24/07 ' ~i rp 5/27/07 „ C b 5/30/07 6/02/07 N 6/05/07 w 6/08/07 y 6/11 /07 1 6/14107 ~ I ~~ ~~ 6/17/07 6/20/07 E 6/23/07 t a' 6/26/07 6/29/07 ~~~,. <, . „ u ~. a ~,., ,~.. , „ . ~., . , _ ,,, k ,, _. G • • 2007 May's PCU #4 Storage Well Monitorin Report Subject: 2007 May's PCU #4 Storage Well Monitoring Report From: "Greenstein, Larry P" <Greenstcinlp@clrevron.com> ~,~, ~~If ~~' ~ Date: Thu, 07 Jun 200717:50:53 -0500 ~~~~ To: Thum~~s ~tauncier ~~-tun~_m~iun~lcr~u~admin.statc.~ik.us~-~, .fim 1Z_~~~~ -~~ji~r~rr~~~~cr:~idi~~in.s~<~~e.ah.us--~ CG "Orr. Gar~~ :~." ~-ORRG,-1ic~~cherrcm.eom-~ Fli Tom & Jim, Here is May's monthly report for the wails requiring pressure monitoring in the PCU #4 storage reservoir. Neither well produced in April or May, but a lot of gas was put into the ground. PCU 2 shows a gradual ~I tubing pressure increase which the engineer attributed to fluid level changes and a partially successful sand bailing job in mid-April and not a response from the increased gas stored in the PCU #4 well. Bottom line, I don`t see any unexplained indication that any stored gas is not being contained in the approved storage area. Larry «Master Well List TIO Report 2007 05 31.x1s» 'Master Well List TIO Report 2007 OS 31.x1s Content-Description; Master Well List TIO Report 2007 05 31.x1s Content-Type: Content-Encoding: application/vnd.ms-excel base64 1 of 1 6/11/2007 9:08 AM Pressure 0 0 0 0 ° 0 ° ° 0 0 o o 0 3/02/07 q 3/05/07. z 3/08/07 3/11 /07 ~; 3/14!07 ~ ~ ~~ z; 3/17/07 A 3/20/07 3/23/07 b 3/26/07 O 3/29/07 ~ I ~"d ~ ~ I I F! 4/01 /07 ~ I i i ~ ~ ~ < < ~ v~ 4/04/07 ~ ~ ~ ~ w °~\° ~' ,~~ ! ~ w _ ~ ~ ~D 4/07/07 - 4/10/07 - - ~ - - I 4/13/07 > ~ ' m ~ 4/16/07 ~ I ~~ C ~ ~ x` y 4/19/07 A ~• ' ~ /22/07 , u 4/25!07 ' ~ 4/28/07 "; ~ ~ 5/01 /07 I! b 5/04/07 5/07/07 u ~ 5/10/07 1 ' 5/13/07 5/16/07 5/19/07 5/22/07 5/25/07 5/28/07 5/31/07 - _;. ,,_ __, _ :_._ i ° ° ° ° ° ° ° ° ° o ° o ° o ° o o ° Red ° o o o ° ° ° Pressure 0 0 0 0 °o 0 0 0 0 0 0 0 0 0 0 1 /07 4/07 7/07 0/07 3/07 6/07 9/07 1 /07 10/07 13/07 16/07 19/07 1 /07 O • b O b C "~ A~ e y ~.. CD ~.. b t•J c-~. C V N ~ O OD ~ ~ .~ ~ ~ O O O O O O O O O O O O O O 2007 April's PCU #4 Storage Well Monitoring Report ~~ • Subject: 2007 April's PCU #4 Storage Well Monitoring Report From: "Greenstein, Larry P" <GreEnsteinlp@chevron.cotn> ~ ~'I~ 0 Date: Fri, 04 May 2007 16:13:11 -0500 ~ ~ t ,~ To: Thomas Maunder ~_-tom maundcr('u'admin.state.iik.u5 -,Jim Red-;~' `aimis«~~<<i;aeim~n.state.al`.us=~° CC: "On'. Gary ~." '~OIZRGA(uchevron.com= Hi Tom & Jim, Here is April's monthly report for the wells requiring pressure monitoring in the PCU ~#4 storage reservoir. Neither well produced in April, but a lot of gas was put into the ground. PCU #2 had same bailing done to clean out sand last month. To ensure no further sand ingress, some gas pressure was applied to the tubing and held. This shows up as ~ 275# tubing pressure increase on 4113107. Bottom line, I don't see any indication that any stored gas is not being contained in the approved storage area. Larry «Master Well List TIO Report 2007 04 30.x1s» Content-Description: Master Well List TIO ~ Report 2007 04 30.x1s Master Well List TIO Report 2007 04 30.x1s- Content-Type: application/vnd.ms-excel Content-Encoding: base64 1 of 1 5/4/2007 2:21 PM Pressure 0 0 0 0 0 0 0 0 0 0 0 0 $ o 0 0 0 0 0 1 /30/07 2/02/07 5 2/05107 2/08/07 2/11 /07 2/14/07 2/17/07 y 2/20/07 b 2/23/07 ~ O y ,..r 2/26/07 ~ b "'! 3/01 /07 ~ ~ ~ ~ ~ 3/04/07 s I _ 3/07/07 3/10/07 ~ y 3/13/07 ~ ~~ ~ CD 3/16/07 ~~ ~ ~ y 3/19/07 3/22/07 ' ~p _ - - _ ~' ~ 3/25/07 I 3/28/07 ` I ~ I I I :~ ' ~ . ~ 3/31 /07 o_ o = w ~ J ~ 4/03/07 ' ~ a ~ ~ _ ~ w ~ ~ ~ 4/06/07 ' ~ 4/09/07 4/12/07 4/15/07 4/18/07 "" 4/21107 4/24/07 4/27/07 4130/07 ,.__---- ----_~_. .. ,,_ __ _;-.-- _ _. . ~ _ __.~ . _ _ r.~.._r _ ._ _._ _ .. __._r~__ _._--.... _ -.~--, ,~,._.. _ O ~ O N O W O ~ (T O O O v 00 O O O O O ° ° °o °o °o °o Rai o o o o • ~ ~V -P C. Pressure 0 0 0 0 0 0 0 0 1 /30/07 - _ . 2/02/07 2/05/07 2/08/07 2/11 /07 - ~' 2/14/07 y 2/17/07 e ti : 2/20/07 ' ~: y, 2/23/07 ' ~ ~ ~ ~ ~ ~ ~ ~ 2/26/07 o ~ w t° ~ o 3101 /07 ' ~ ~ _ ~_ oW~o w F ~ Q d; ~ 3/04/07 _ 3/07/07 ~ `~ CD 3/10/07 ""'~~° h 3/13/07 3/16/07 ' ~' ~ F ~ ~ 3/19!07 ~ y 3/22/07 3/25/07 rp 3/28/07 3/31107 ~ 4/03/07 ~ r.d 4/06/07 4/09/07 ~ N 4/12/07 4/15/07 ' 4/18/07 ` 4/21 /07 ; /24/07 4/27/07 4/30/07 . ~.~.__ _ ~:.-w-,-~_.~~_~_ . ~._~~~_,~ ~-. _~~_-• -~--__.~~ ~,~___~_~.~.m.~ ~,----___ ~_._~~_ _ .Y __ O O O O O O N A O O O O O O O O O O O p Rate • • rte/ V ~,, nn v\ -~ G 2007 March's PCU #4 Storage Well Monitoring Report Subject: 2007 March's PCU #4 Storage Well Monitoring Report From: "Greenstein, Larry P" <Greensteinlp@chevron.com> ~~~ Date: Thu; OS Apr 2007 19:35:25 -0500 ~""i `~ 'f o:Thomas ~~t~iundcr ~~tom maundei~~r%aclmin.stat~.ak.us-,aim R~~~~ ~ ;jii1~ rc~t~~~~i'aci~Y~in.state.aL.uS=° CC: "Orr. Gary' ,a." ~~ORR(;.~lu chc.ti~ron.com~= Hi Tom & Jim, Here is March's monthly report for the wells requiring pressure monitoring in the PCU #4 storage reservoir. Both wells have been producing this past month and #4 has also had a lot of injection. Bottom line, I don't see any indication that any stored gas is not being contained in the approved storage area `p Larry «Master Well List Tf0 Report 2007 03 31.x1s» Content-Description: Master Well List TIO Report 2007 03 31.x1s :.Master Well List TIO Report 2007 03 31.x1s Content-Type: application/vnd.ms-excel Content-Encoding: base64 1 of 1 4/5/2007 4:55 PM 1 /07 4/07 7/07 1 /07 0/07 3/07 6/07 9/07 1 /07 0 b O ~"'d C ~! A~ CD C ,... ~.. .r A • • s. °o °o °o °o o °o °o °o °o 0 0 0 0 0 0 0 0 0 Rate Pressure O N ? O W O O O O O N O O A O 1 /01 /00 1/04/00 `s - 1/07/00 I ' 1/10/00 ~ N ~ CO ~ °- ~ ° 1/13/00 ' 1 /16/00. ~' 1/19/00: '` r.~ u, 1 /22/00 ~ ~ .~.....~+.~.~s ~ . 1 /25/00 _ ~ C 1 /28/00 ~ ~ 1 /31 /00 ~ ' ~ ~ `~ v~ 2/03/00 ~ _ 2/06/00 ' ~ 2/09/00. :, ~, 2/12/00 ~ ' ~ ~ 2/15/00 ~...~i~ e 2/18/00 ; . ~; ~ ~ 2/21 /00 ~' 2/24/00 ~ i 2/27/00: y 3/01 /00 ' ~ .r 3/04/00 b n 3/07/00 ~ ~ 3/1 U/00 `: ~ N 3/13/00: ~6.., 3/16/00 3/19/00 3/22/00 3/25/00 3/28/00 O N A O O O O O O O N A O OD O O O O ~ 00 O O O Rate • • ~./~ i i~ 2007 February's PCU #4 Storage Well Monitoring Report c: Subject: 2007 February's PCU #4 Storabe Well Monitorinb Report From: "Greenstein, Larry P" <Greensteinlp@chevron.com> .~~ 3~~°~~a~ Date: Tue, 13 Mar 2007 11:49:21 -0500 To:Thonr,~s yl~luucice<tonl_m~iutldcr;~~i<idmit~.state.~~k.u5- ~, .Iitt~ Re~~ ~~ain~ r~~~ ~ rr ad~7lin.~t~ir=e.ak.us> CC: "Orr. (_;tir~~ ;~." ~~_ORRG.1iu?chcti r~,n.c~~rn . Hi Torn & Jim, ~dlP - sTO y- Here is February`s monthly report for the wells requiring pressure monitaring in the PGU #4 storage reservoir. Both wells have been producing this past month and #4 has also had a lot of injection. Bottom line; I don't see any indication that any stored gas is not being contained in the approved storage area, Larry «Master Well List TIO Report 2007 02 28.x1s» Content-Description: Master Well List TIO Report 2007 02 28.x1s 1Vl~ster Well List TIO Report 2007 02 28.x1s ~ - ` Content-Type: application,/vnck.ins--excel Content-Encoding: base64 1 of 1 3/19/2007 3:03 PM Pressure 0 0 0 0 0 0 0 0 °o 0 0 0 0 0 0 12/01 /06 .~: 12/04/06 ~ I I 12/07/06 o ~ o w = ~° cn 12/10/06 - _~ ~ ~ ~ ~° ~ o n. 12/13/06 12/16/06 "' s 12/19!06 ; 12/22/06 12/25/06 ~ O 12/28/06 b ~ 12/31 /06 ~ 1/03/07 ` ~ ~ { ~ 1 /06/07 ~ """"'" Qp w 1 /09/07 ~ ,~ ~ A~ 1 /12/07 `° ~ 1 /15/07 ~°' ~ ~ " 1 /18/07 ' ~ 1/21/07 ~ i 1 /24/07 ~ 1 /27/07 ~, ~. 1 /30/07 ~"d 2/02/07 2/05/07 N 2/08!07 2111 /07 2/14/07 2/17/07 2/20/07 2/23107 2/26!07 O ~ ~ ~ N N W O o O cn O O O o cn 0 o 0 O o 0 0 0 n G ti • • Pressure 0 0 0 0 °o 0 0 0 0 0 0 0 0 0 0 0 0 0 0 12/01 /06 a 12/04/06 " - -- -- - - 12/07/06 12/10/06 ' ' 0 0 ~ ~ ~ ~ ~ r ~' ~, ~_ w _ ~ 12/13/06 ~ ~ ~ w o ~° 12/16/06 " °' 12/19/06 12/22/06 ' ~ 12/25/06 ' ~' O ~; ~ 12/28/06 ~ b d_ "Y 12/31 /06 ~ ~ _ 1 /03/07 "! ~ 7 CD 1 /06/07 ~ ~p 1 /09/07 A~ 1/12/07 ` ~p ~ 1/15/07 y 1 /18/07 u 1 /21 /07 rD i 1 /24/07 { F 1 /27/07 `' ~ 1 /30/07 2/02/07 C"' i ~ 2/05/07 2/08/07 2/11/07 2/14/07 2/17/07 2/20/07 ' ' 2/23/07 2/26/07 '' ° ° ° ° ° ° ° ° ° o ° o ° o ° o o Rath o o o o o o ° o 9 0 • • 2007 January's PCU #4 Storage Well MonitoReport ~ ~ z~,~~~ Subject: 2007 3anuary's PCU #4 Storage Well Monitoring Report From: "Greenstein, Larry P" <Greensteinlp@chevron.com> Date~:'Fri, 09 Feb 2047 15:15:51 -0600 To: `I honias Maunder <~tom maunder(~radmin.state.ak.u~ ~, .lim Rc~~~ <jim t-e~~~~<<i'adn~in.state.ak.us CG "~Vtlitaere, Day e S" ~ ~~~hitacrcdlri_~chevron.com==, "Orr. Gary A." ~ =ORRG,~~ci;che.vron.coi~1=>, "Dolan, Jeff J" ~~dol~inlJ~~chevron.co~7~- Hi Tom & Jim, Here is January's monthly report for the wells requiring pressure monitoring in the PCU #4 storage reservoir. We have started using the PCU #2 Well more this month. Bottom line, I don't see any indication that any stored gas is not being contained in the approved storage area. Larry «Master Well List TIO Report 2007 01 31.x1s» Content-Description: Master Well List TIO Report 2007 O1 31.x1s Master Well List TIO Report 2007 Ol 31.x1s Content-Type: application/vnd.ms-excel Content-Encoding: base64 1 of 1 2/13/2007 4:50 PM r~~ ~r v Pressure (psi) ~ ~ O N N O O O O O 10/31 /06 ,: 11/03/06 '~ ~ - -- - - 11 /06/06 ~ ~ ~~ 11 /09/06 ~ ~ ~ o c o w ~ ~! can - 11/12/06 ~~~ .v ~ o ~ <,, ~ w ~~ i a 11/15/06 ~ 11 /18/06 ~ 11 /21 /06 q: ~ ~ ~~ ~ ~ ~ , 11 /24/06 ~ ~ a ~ 11 /27/06 ~ ~ ~"d 11 /30/06 k ~ ~ ~ 12/03/06 ' C ~ '~ 12/06/06 ~ 12/09/06 ~ ~0 12/12/06 ~ 12/15/06 r~ ~ r. e~ 12/18/06 , v' y 12/21 /06 y "• • 12/24/06 ~ CD ~ 12/27/06 12/30/06 ' ~ ~ ~ 01 /02/07 s ~ 01 /05/07 F 01 /08/07 " N 01 /11 /07 01 /14107 01/17/07 k€ 01 /20/07 01 /23/07 01/26/07 ~ ~. .r^ 01 /29/07 '< O CJi ~ ~ N N O O O O O O O O O Rate (Mcf/d) • ~~ 0 Pressure (psi) ° ° ° ° o ° ° ° ° o o o o o o o o o 10/31 /06 11 /03/06 ', 11 /06/06 ''- 11 /09106 11/12/06 ~ 11 /15/06 ~ "'~~ 11/18/06 F 11 /21 /06 ~~! ', V 11 /24/06 ~` p 11 /27/06 r ~ 11 /30/06 s ~ rD 12/03/06 _ ~-! 12/06/06 '` `'! ~ ~ ~ 12/09/06 ~ 12/12/06 ~ p c ~ ~ 12/15/06 ' rn ~ ~ ' ! w cn w o'o ~ ~ ~ ~ 3 ~ ~ ~ 12/18/06 + Q- ' ~~ ~ ~ 12/21/06 12/24/06 ', y: ~p 12/27/06 12/30/06 ' rp 01 /02/07 `~ ~ 01 /05/07 01 /08/07 01/11/07 " 01 /14/07 01/17/07 01 /20/07 `' 01/23/07 01 /26/07 01/29/07 . o °o °o °o °o °o °o °o °o 00 Rate (Mcfld) • ~' 31 2006 December's PCU #4 Storage Well Monig Report ~~ Subject: 2006 December's PCU #4 Storage Well Monitoring Report ~ ~~~ I` From: "Greenstein, Lany P" <Greensteinlp@chevron.conl> Date: 'Thu, 25 Jan 2007 12:47:40 -0600 To: Thomas ~~launder °~-tom maundcr(uadmin.state ak.us==, .lim IZeg~ °~jii~~ rr~T„„r'ciadmin.stare.ak.us=- ['C: "~~'hitacrc, Dare S" <~~~hitacre~l(ci;~che~a-orl.com ~, "Smetanka, .left W"' smctankaj~u che.~ron.co~~~-~~. "Dolan ~~Jeffi J" °~=dolanjj(a;chevron.coill=~ Ni Tom & Jim„ Nere is December°s monthly report for the wel{s requiring pressure monitoring in the PCU #4 storage reservoir. The PCU #2 wail has started production and PCU #4 also had a {{ttle production this month again. PGU #4 well continues to receive some gas for storage and shows the shut-in tubing pressure increase as expected. Bottom {ine„ 1 don't see any indication that any stored gas is not being contained in the approved storage area. Larry «Master Well List TIO Report 2006 12 31.x1s» 'Master Well List TIO Report 200612 31.x1s Content-Description: Master Well List TIO Report 2006 12 31.x1s Content-Type: application/vnd.ms-excel Content-Encoding: base64 1 of 1 1/26/2007 8:45 AM 0 0 0 0 0 0 0 Pressure 0 00 0 0 0 0 0 0 0 0 0 0 -,~..,--~-- 10/01/06 __ _..~.:.~_ ._..~_ ~.~_ ~ 10/04/06 10/07/06 10/10/06 10/13/06 10/16/06 10/19/06 10/22/06 b 10/25/06 ` ` O 10/28/06 I ~ ' rb ~ 10/31 /06 < < ~ N ~ rv ~ o ~ ~ 0 o c rn o_ w v, _ ~ 11/03/06 ' ~ ~ ~ ~' ~ ao = C 11 /06/06 °~ . ~ "~! ~ 11 /09/06 11/12/06 ' CD 11/15/06 ' C 11/18/06 ~ M..~ 11 /21 /06 ... 11 /24/06 ' i 11 /27/06 ~D 11 /30/06 '' r..~ '~' "d 12/03/06 ' " (~ ~ 12/06/06 ' 12/09/06 12/12/06 12/15/06 " 12/18/06 ~ 12/21 /06 12/24/06 12/27/06 ~' 12/30/06 O N ? O ° ~ ~ ° ° Rate o O J • ~ Pressure 0 0 0 0 0 _ o 0 o $ 0 0 -- _ ~-- 10/01 /06 '~ 10/04/06 10/07/06: 10/10/06 I < ~ N ~ o v 10/13/06 o c ~ o_ w U, o ~° = 10/16/06 °' 10/19/06 10/22/06 ~ 10/25/06 ,; _ O 10/28/06 ~ ~y ' '" x ~ "~! ~ 10/31 /06 ~ 11 /03/06 "'' _ " ! 11 /06/06 '' 11 /09/06 -~ 11/12/06 ~ ~D 11/15/06 ~; ~ 11 /18/06 ~--] 11 /21 /06 11 /24/06 ~ 11 /27/06 a ~ 11 /30/06 ~ _ ~ "C7 12/03/06 12/06/06 N 12/09/06 12/12/06 12/15/06 12/18/06 .~"" 12/21 /06 .. 12/24/06 12/27/06 12/30/06 .--_. ~.,- O O O ' ~ N O (11 O O O O N CJ~ O W W O CJt O O O O O O O O -~ a V • ~ 2006 November's PCU #4 Storage Well Moni~ng Report ~ 'li 7~~ l `~ i Subject: 2006 November's PCU #4 Storage Well Monitoring Report ~'~ From:.":Greenstein, Larry P"<Greensteinlp@chevron.com> Date: Wed, O6 Dec ?OO6 1 0:46:47 -0600 'To: "hhomas Maunder ~=tom_maunder~u~admin.state.~lk.us-->, Jim EZe~~ ~jim_r~i1~~(ciadi~~in.state.ak.us=> CC: "~~`tlitacre, Dave S" ~~whitacred(u;:chcvron.com==, "Smetank~i, Jeff W" <_smetankaj(cr~cheti~ron.com>, "Dolan, Jeff.!" <dolanjj(ci~:chevr-on.com== Hi Tom & Jim, Nere is November°s monthly report for the wells requiring pressure monitoring irf the PCU #4 storage reservoir. Surface facilities are still being prepared to return the PCU 2 weil to production. pCU #4 well continues to receive gas for storage and shows the shut-in tubing pressure increase as expected. PCU #4 was used for free flow production for the first time (since conversion to gas storage) the day before Thanksgiving. Bottom Gne, I don't see any indication that any stored gas is not being contained in the approved storage area. tarry «Master Well List TIO Report Dec 2006.x1s» Content-Description• Master Well List TIO Report Dec 2006.x1s Master Well List TIO Report Dec 2006.x1s ,Content-Type: " Content-Encoding: application/vnd.ms-excel base64 1 of 1 12/7/2006 3:48 PM Pressure _ N A O 0o O N A O Oo O O O O O O O O O O O O O O O O O O O 1/06 4/06 7/06 0/02/06 0/05/06 0/08/06 0/11 /06 0/17/06 0/20/06 0/23/06 0/26/06 0/29/06 1/01/06 1 /04/06 1 /07/06 1 /10/06 1 /13/06 1 /16/06 1 /19/06 1 /22/06 1 /25/06 1 /28/06 2/01 /06 O Rate • "'d O ~"d rD C ~T CD A~ CD y ~.. .r b A N A O W O O O O O O O O O O O Pressure 0 0 0 o S o 0 0 0 0 0 0 0 0 0 0 0 9/02/06 j. ----__~---------- ---- --- __~ . 9/05/06 9/08/06 I I 9/11/06 m ~ c o w ~' ~ w ~~ ~ o0 ~° 9/14/06 - 9!17/06 9/20/06 9/23/06 ~ 9/26/06 O 9/29/06 ~ r~ "! 10/02!06 ~ 10!05/06 ~ ~ ~T ~ 10/08/06 10/11 /06 10/14/06 ~ CD 10/17/06 ~ ~ 10/20/06 ~-~] ... 10/23/06 ~ 10/26/06 ~ 10/29/06 ` 11 /01 /06 11 /04/06 11 /07/06 N 11 /10/06 11 /13/06 11/16!06 11 /19/06 11 /22/06 11 /25/06 L~ 11/28/06 ~ 12/01 /06 w -~ . J • 2006 October's PCU #4 Storage Well Monitoring Report • Subject: 2006 October's PCU#4 Storage WellMonitoring Report ~ From: "Greenstein, Lar~-yP" <Greensteinlp@chevron.com> ~'~~ I~~t~~ Date: Thu, 09 Nov 2006 19:52:45..-0600 ~~ To: Thotilas :'launder tom_maunder(uadmin.statc.ak.us->, .Iim Rc~~~ `~-jimrt~~~(~i:'adi~~in.state,akus==~ CC: "Whitacre, Dave S" <~whitacrcd(riche~~ron.com~=, "Smet~lnka, JefF ~V~~ -smetankaj~~z~.chevron.coill-, "Dolan, Jeff.i" ~~=dolanjjr~i~.chevroil.coil~~- Ni Tom & Jim, Nere is October's monthly report for the wells requiring pressure monitoring in the PCU #4 storage reservoir. Surface facilities are being prepared to return the PCU 2 well to production. PCU #4 well continues to receive gas for storage and shows the shut-in tubing pressure increase as expected. Bottom line, I don't see any indication that any stored gas is not being contained in the approved storage area, Larry «Leftover Well List TIO Report Nov 2006.x1s» Content-Description: Leftover Well List TIO Report Nov 2006.x1s .Leftover Well List TIO Report Nov 2006.x1s Content-Type: application/vnd.ms-excel Content-Encoding: base64 1 of 1 11/15/2006 2:45 PM 0 0 0 Pressure 0 0 0 0 0 0 0 0 0 0 _y~_._ ~ 0 0 _ ~_ 0 0 m.~,. 8/04/06 __.~- ___. ,.___.___~. 8/07/06 I 8/10/06 - C ~ ~ N v 8/13/06 ~ O W to ~ o0 _ ~ - - 8/16l06 8/19/06 8/22/06 8/25/06 `d 8/28/06 "r O 8/31 /06 ~ 9/03/06 ~ ~ ,, v, 9/06/06 ' C ~! 9/09/06 ~~ r ~ 9/12/06 `` ~ 9/15/06 9/18/06 t 9/21 /06 " i--] -.. 9/24/06 CD 9/27/06 ' ~ ~ 9/30/06 ` CD 10/03/06 ' ~ ~ n 10/06/06 10/09/06 'i N 10/12/06 10/15/06 '` 10/18/06 10/21 /06 10/24/06 10/27/06 ` 10/30/06 11 /02/06. x , ,. , ~ , . • • 0 0 0 0 0 . Pressure 0 0 0 0 0 0 0 0 ~ __ 0 0 ~. 0 0 0 0 _----------- T 8/04/06 =~ - _ - .. _-T.__. , _~, 8/07/06 8/10/06 ~ I 7 . C N ~ O ~ O W ~ 8/13/06 < 6 w ~ o ~ ~_ 8/16/06 8/19/06 8/22/06 8/25/06 8/28/06 ~ O 8/31 /06 ^r b 9/03/06 ~ ~ 9, 9/06/06 ~ ~ C 9/09/06 ~ ? "~ CD 9/12/06 9/15/06 9/18/06 rD C 9/21 /06 ~ y 9/24/06 9/27/06 ~ ~D 9/30/06 10/03/06 ~ ~ ~ ~ _ 10/06/06 ~ b n 10/09/06 ~ 10/12/06 .~...~.. ~ -~ 10/15/06 """"~'-- 10/18/06 10/21 !06 10/24/06 10/27/06 10/30/06 11/02/06 ~ _ ~--~-~,-~--„1 ,_,._.~.~~___._..~:.,~,.~.~~_ ._~.~._._{.. ~ - o ° ° ° ° o o o o 00 0 • 2006 September's PCU #4 Storage Well Monit~ g Report • ` ' ~~ ~ILIL~~ ~~ Subject: 2006 :September s PCU #4 Storage Well Monitoring Report From: "Greenstein, Larry P" <Greensteinlp@chevron.com> Date: Tue, 10 Oct 2006 11:03:29 -0500 To: 1'honlas '~~~laund~r °~~-tom_maunder(c1 admin.<ate.ak.u~-, Jim Re~~~ ~~-jun_rc~~~~~a.'adm~n.state.a~.us CC': "~~V'hitacre, Da~~e S" <~~~~hitacred~ci<che~~ron.com== "Smetanka, JeI~L W'• -smctankajrcr~:chevron.coi~~ ~~, "Dolan, .lcfl~.l" ~~-dolan}~~ci~~.chcvron.~om-= Hi Tom & Jim, Nere is September's monthly report for the wells requiring pressure monitoring in the PCU #4 storage reservoir. The PCU # 2 well was recompleted up hole last month and the corresponding pressure changes have shown up on the chart. We anticipate }cringing this we}l on production later this month, Bottom line, I don't see any indication that any stored gas is not being contained in the approved storage area. Larry «Master Well List TIO Report Sept 2006 vicer.xls» ',Master Well List TIO Report Sept 2006 vicer.xls Master Well List TIO Content-Description: Report Sept 2006 vicer.xls Content-Type: application/vnd.ms-excel Content-Encoding: base64 1 of 1 10/16/2006 10:30 AM 0 0 0 Pressure 0 0 0 °o 0 0 0 0 0 0 0 0 0 0 7/10/06 ~,~-- 7/13/06 ( I 7/16/06 ~ = No ~ = G, ~ ~' ~ . ~ w ~ 7/19/06 ' ~ p ~ Z 7/22/06 7/25/06 7/28/06 7/31 /06 b 8/03/06 ' p 8/06/06 - ~ 8!09/06 ~ 8/12/06 ~ "! 8/15/06 8/18/06 A~ 8/21 /06 ~ 8/24/06 ~ 8!27!06 y 8/30/06 9/02106 ' ~ 9/05/06 rp 9108/06 C ~ 9111 /06 9/14/06 N 9/17/06 9/20/06 ' e 9/23/06 s, x 9/26/06 9/29/06 10/02/06 y' ~;. 10/05/06 10/08/06 ~ „ - >; • • Pressure 0 0 0 0 °o 0 0 0 0 0 0 0 0 0 0 0 0 7/10/06 ' 7/13/06 ' ( ~ I 7/16/06 ~ o w ~ ~ ~ _ ~ 7/19/06 r ~ N ~p ~ ~ w 0D ~ - r 7/22/06 Z v 4, 7/25/06 a 7/28/06 - ~; 7/31 /06 8/03/06 " ~' ~ O 8/06/06 '"~ ~ 8/09/06 ' ~ 8/12/06 ~ 8/15/06 ~ ~D 8/18/06 8/21 /06 ~ 8/24/06 y rD e 8/27/06 F ~ ~ y 8/30/06 ~ 9/02/06 i 9/05/06 9/08/06 ~ 9/11/06 ' ""'"'-- b 9/14/06 9/17/06 ~ 9/20/06 9/23/06 9/26/06 2 9/29/06 - 10/02/06 10/05/06 a 10/08/06 o ° ° ° ° o o o 0 0 Rate • • 2006 August's PCU #4 Storage Well Monitorin~„Report Subject: 2006 August's PCU #4 Storage Well Monitoring Report ~, (~ ~~{;~~~'~ From: "Greenstcin_ Lar~-~~ 1'" <Greensteinlp@chevron.com> '~~'~~ Date: Thu, 07 Sc~ ?UOG 10:58:33 -0800 To: Tbc~z~~as Viau~~dcr°~1om maunder(cr~,at3min.statc.ak.us= ,Jim [Zed<~ °~;jiiTir~~~ ~~«;adt~iin.slate.al..us, CC: "~~'hit~~cre., Da~~e S" ~~whi<<~crc~l~ci)unocal.com- ~, "Smetal~ka, Jeff G~'" ~-sme-tanl:aj~"uche,vron.c~>m=~. "Dolan, Jeff~J" =ciolanlJ!~i;chc~ ron.cotli-' Hi Tom & Jim, Nere is August's monthly report for the wells requiring pressure monitoring in the PCU #4 storage / reservoir. The PCU # 2 well has been shu#-in far some time and is being used to monitor injection zone isolation. Looks like the chemical treatments on PCU #4 have had some benefit as the well is starting to respond more as expected. In addition, PCU #2 has been recently recompleted up hole and will show the ,/ corresponding pressure changes on next month's report. Bottom line, I don't see any indication that any stored gas is not being contained in the approved storage area. Larry «Master Well List TIO Report Aug 2006.x1s» Content-Description• Master Well List TIO Report • Aug 2006.x1s '':Master Well List TIO Report Aug 2006.x1s Content-Type: application/vnd.ms-excel Content-Encoding: base64 1 of 1 9/8/2006 9:07 AM Plot Pressure & Rate vs Time -Well PCU 4 1000 ~.. 7.. ~~9 5/8" 900 13 3/8" Tubing 800 700 600 4a L N 500 L Q. 400 300 200 100 0 0 N O • • • 2006 July's PCU #4 Storage Well Monitoring Report . _ Subject: ?006 July's PCU #4 Storage Well Ntonitoring Report ~ ~~~,~~~ From: "~;recnstein, Lar«~ P"` <Gre~nsteinlp(<<?chcvron.eom? ~~~ Date: Tue, 0~ Aug 2006 1 ~:=10:08 -0800 To: Thomas Maunder <tonl__maunder(a;~admin.state.ak.us>, ;Ii111 Re~~ ~jim_re~.;~~ci~adrnin.state.ak.us> CC: "Whitacre, Daec S" ~~~~hitacred(ccunocal.com==, "Smelanka, 3eff VV" ~smetankaj(uchevron.com%, "Dolan, Jcff.l" <dolanjj(uchevron.com~> Hi Tom & Jim, Here is July's monthly report for the wells requiring pressure monitaring in the PCU #4 storage reservoir. The PCU # 2 well has been shut-in for some time and is being used to monitor injection zone isolation. The gas injection into PCU #4 has remained down fior a while due to low infectivity. We have a CTU over on the West Side to work on this well and others. The pressure monitoring doesn't show any indication of annulus communication. Bottom line, I don"t see any indication that the storage gas is not being contained in the approved storage area. Larry «Master Well List TIO Report Jul 2006.x1s» Content-Description: Master Well List TIO Report Jul 2006.x1s Master Well List TIO Report Ju12006.x1s Content-Type: application/vnd.ms-excel Content-Encoding: base64 1 of 1 8/14/2006 10:15 AM Plot Pressure & Rate vs Time -Well PCU ~} , 1400 2000 .: _ ,. ~~ ~„ i 1800 ~~9 5/8" . 1200 13 3/8" 1600 Tubing ~~VOL 002 I 1000 1400 i 1200 800 L ~ i } N 1000 ~= ~ 600 800 400 600 400 '' 200 200 ,, 0 _ ., O O t° m co ~ ~ co cg o ~o 0 _ _ 0 0 ~ 0 O N _ ~ ~ Q N M O M O r d' ~ `' N N ~ ~ _~ ~ N O ~ O ~ ~ ~ ~ In ~ (O CO CO N ~ ~ n • • Pressure O O ~ ~ N N W W ~ O ~ O O O O O O O 5/02/06 , I I 5/09/06 ` W (n ~ ~ w co 5/16/06 5/23/06 b O ~ 5/30/06 ~! C 6/06/06 ~ - 6/13/06 ~ 6/20/06 6/27/06 rD ... 7/04/06 N 7/11 /06 7/18/06 7/25/06 • • 2006 June's PCU #4 Storage Well Monitoring Report . • ~ ~,~, Subject: 2006 June's PCU #4 StorageWell Monitoring Report ~ '7 ~ ~"~ From: "Greenstein, Lany P" <Greensteinlp cr cl~t~r~~n.com> ~~~~ Date: Mon, 0'~ .lul 2006 U~:--1:04 -0800 To: "I~humas ~9aunder~~=tom m~n~nd~r~t~admin.~tate.akus>. Jim Rc,~~~ ~imre~~~~a'admin.statc.aku~== CC': "~i'hitacc~, [)a~~ S" <«~hitacrcd'~%.uno~al.cum=>. "timet~inka, .lef~h~1~"' ~sil~etank~ijiu~che~~roil.ct~«~=~, "[)olz~n, ,I~~If~J" <:~lolanjj~~r:ch~~~ron.oom== Hi Tom & Jim, Here is June's monthly report for the wells requiring pressure monitoring in the PCU #4 storage reservoir. The PCU # 2 well has been shut-in for some time and is being used to monitor injection zone isolation. The gas injection into PCU #4 has remained down for a while due to low injectivity. 11Ve are still looking into ways to improve the injectivity into the well. The pressure monitoring doesn't show any indication of annulus communication. PCU #2 appears to have some duplicate data entry problems, we will try to clean these up before the next report. Bottom line, I don't see any indication that the storage gas is not being contained in the approved storage area. Larry «Master Well List Wavered Well Report Jun 2006.x1s» Master Well List Content-Description: Wavered Well Report Master Well List Wavered Well Report Jun 2006.x1s Jun 2006.x1s Content-Type: application/vnd.ms-excel Content-Encoding: base64 1 of 1 7/6!2006 5:13 PM Pressure O O ~ ~ O O O ~ ~ O O O N O O O 12/30/05 I I I I 1 /06/06 1/13/06 y ~ ~ 0 3 w cfl ~ J - co ~ - 1 /20/06 a s - 1 /27/06 ~ y 2/03/06 b 2/10/06 ~` 2/17/06 ~ 2/24/06 % ~ ~' 3/03/06 ~ ~ & ~ 3/10/06 E 3/17/06 k QO 3/24/06 ~ ~ `~ ~ ~ 3/31 /06 ~ ~ v~ 4/07/06 t ~ y 4/14/06 `; a` ~ 4/21 /06 ' ~ z` 4/28/06 ~ ' '_' ...r....r. 5/05/06 ~ 5/12/06 C,' 5/19/06 ;' 5/26/06 Y 6/02/06 6/09/06 s 6/16/06 6/23/06 o ° ° ° ° ° ° °o °o o o °o o o o o Rate Pressure N N W O O O O W O A O O O O 12/30/05 ; 1 /06/06 I 1/13/06 ', ~ w ~' ~ co a° ~ ;. 1 /20/06 a v 1 /27/06 y 2/03/06 2/10/06 ~~ ~ 2/17/06 ' O '"~ 2/24/06 ' b ~~ ~ 3/03/06 ' ~ "~ 3/10/06 ~ ~ ~ rp 3/17/06 a u 3/24/06 ' ~ ,~,r 3/31 /06 ~ ' 4/07/06 ' % 4/14/06 '' ~ 4/21 /06 -: s, 4/28/06 ~; b 5/05/06 '` 5/12/06 ~" N 5/19/06 5/26/06 y s 6/02/06 ` ~ h 6/09/06 ~ ----- M 6/16/06 ~. ~ ~ ~ 6/23/06 T %' yam ~,.rr~;^a~ai ~. .r_ +rr .ar~x~ i ,rs, flare ~nzxx^+s , r.~w;rxzrsrxzwi i.uc .. ,~;. , o a ars„ ~/ i ~ 2006 May's PCU #4 Storage Well Monitoring Report - ` • Subject: 2006 May's PCU #4 Storage Well Monitoring Report From: ".Greenstein, Larry P" <Greensteinlp c~chevron.coin> ,~, ~ ~ ~ ~ ~~, Date: Tue, 06 Jun 2006 l t>. ~-i:-l ~ -0800 `,~,c~~ 1 To: Thum~~s ~11~lundcr "-t~~ru r»~iun~lcr:~i!.admiil.stale.ak.u~=, iim l:e~~~ ;lii1~ r~~~,~i;a~ln~in.state.aku.~~~ CC: "1Vhita~re_ L)a~~r S" °~-~~~hilacre~l criunocal.r~~m=~~, "Smetanka, Jc'tt~~~ti~" --smetanl.aj ~i'~he~-rcm.com='. "Dolan, Jcf~f.l" ~-dolanjj(a~chevron.~~~~n~=- Hi Tom & Jim, Here is May's monthly report for the wells requiring pressure monitoring in the PCU #4 Storage reservoir. The PCU # 2 well has been shut-in for some time and is being used to monitor injection zone isolation. The gas injection into PCU #4 has been stopped for a while due to low injectivity. We are looking into ways to improve the injectivity into the well The pressure monitoring doesn't show any indication. of annulus communication. Bottom line, I don't see any indication that the storage gas is not being contained in the approved storage area. Larry «Master Well List Wavered Well Report May 2006.x1s» Master Well List Wavered Well Report May 2006.x1s __ Master Well List Content-Description: Wavered Well Report May 2006.x1s Content-Type: application/vnd.ms-excel Content-Encoding: base64 1 of 1 6/8!2006 1:06 PM Plot Pressure & Rate vs Time -Well PCU 4 zooo .~ ~a,,,~. ,m~, ~a=A.~,~~, ~~_,__,,~,,,,, .~,~_~ee_x~_„ „~_~~„m~,.,, ,,~„~~, _ ~ ~~_a., ~ __~ e . ,~ „_, __, P _ ,_ ,~ 4 _ ~ __ . ,.~ 7„ 8000 1800 ' - ~9 5/8" 1600 13 3/8" 7000 Tubing ', 1400 ~~I ~Inj Vol ! 6000 1200 5000 ~ ~ N 1000 - ~ ~ 4000 ~ L a • 800 - 3000 600 2000 400 1000 200 . - - - - 0 .~, ~ _ ~. ~,~ ~ ._ w, ~ ... __, .~,~ .,~ ~_, , 4, ~ ~_ f u_ . ~ , _., _,~ _ _. 0 ca co 0 0 co m co co co cfl co cfl co co 0 0 0 0 0 0 0 0 0 0 ~ co 0 O O _ ~ N ~ O ~ N N O ~ ~ N • Pressure N O O _ ~ r .~ ~ N A O O O N A O 0o O O O O O O O O O O 3/02/06 k i I ~ I 3/09/06 y ~ co c w cn W o0 co 3/16/06 " 3/23/06 I b O 3/30/06 ~ ~ rD C 4/06/06 `' ~ 4/13/06 `' ~ fD 4/20/06 ' y i 4/27/06 ? b 5!04/06 N 5/11/06 5/18/06 5/25/06 ,,, r„~. ~,a u w ~, . , .,,,,., ~ ~.. , . , , , . . • ~ ~ 2006 April's PCU #4 Storage Well Monitoring Report • Subject: 2006April's PCU #4 Storage We•I1 >ttonitoring Report ~, From. "Greenstein, Larry P° <Greensteinli~ rr~chcvron.com> ~ ~~ ~~`~~ ~~? , llare: ,'Ion, OR ~9a~~ ?~li)G l~~u~;:rii (~ti0u To: l'homa~ ]~tauncJcr- ~~tom ~~~aundet~uadil~iil.s~tatc.ak.u,>. Jim Rcc~~ 'jimrc~~ u~admin.st~te.ak.us- ~'C: "~~~"}~itticre. Ua~e S" ~ -~~~hitacred,~runocal.ann>, "Smet.~nka. Jeff ~~'~~ -_>metanka~~'a,~che~r~~n.coni>_ "D~~lan, Jett J" ~"aalanjl ciehe~~ron.com> Hi Tom & Jim, Here is April's monthly report for the wells requiring pressure monitoring in the PCU #4 Storage reservoir. The PCU # 2 well has been shut-in far some time and is being used to monitor injection zone isolation. Most of the data retrieval problems have been fixed and the plots are looking better. The PCU #4 well has been on injection only as of late and the tubing looks like it is slowly pressuring up (as expected). Bottom line, I don`t see any indication that the storage gas is not being contained in the approved storage area. Larry «Master Well List Wavered Well Report Apr 2006REV.xIs» Well List Wavered Well Report Apr 2006REV.xIs Master Well List " Content-Description: Wavered Well Report Apr 2006REV.xIs Content-Type: application/vnd.ms-excel Content-Encoding: base64 1 of 1 5/8/2006 4:26 PM Plot Pressure & Rate vs Time -Well PCU 4 2000 ~~~~,~~~~,~ ~~,~~,~: ~ e~~,~~~„~a~~r ~~~~~ ~a~,~~ ~~~~, Q ~ ~z~.,~e_~ ~ ~ ,_,s~e~ ~~~~ ~~„~,,_~ a„~ ..~~ ~~ _,~ _ ~ a~~.,~, ~„ ~ ... ~, 12000 7" 1750 ~9 5/8" 13 3/8" 10000 Tubing 1500 ~Inj Vol 8000 1250 -- - - - - - -- -_ - - - - - - L ~ 1000 6000 ~ d ~ L a 750 - - - _ - - - 4000 500 2000 250 co ca ca co cfl co co co cfl co co co cfl 0 0 0 0 0 0 0 0 0 0 0 0 0 r r N ~M O M N N O ~ N N O ~ r ~ cv N N N M M M M ~ ~ ~ • • Pressure N ~ O O O _ ~ ~ ~ O O O N A O O O O O O O ~ N O O O O 1 /30/06 c w U, 2/06/06 ~ I ~ ~ w ~' ~ ' ~ - -- ~ ~ ~ 2/13/06 ~ i ~~ ~ ~ i r. 2/20/06 ~ ~ ?' O ~ 2/27/06 ~~ I ~ ~ ~ ~ ~ 3/06/06 ~ I , ~ ~ rp ~ ~ ~i ~ ~~ 3/13/06 , ..r , C ~ y 3/20/06 ' ~ 3/27/06 _ ~ ', ~~, CD ~_ I ~ 4/03/06 I I N ' 4/10/06 ~ ' ~` i 4/17/06 ; ~' ; . 4/24/06 ; 2006 March's PCU #4 Storage Well Monitoring Report Subject: 2006 March's PCU #4 Storage Well Monitoring Report From: "Greenstein, Lam- P" <Greensteinlp c~chevron.com> Datc: ~ti~c~l. U5 Apr 2U06 16:~~:46 -080~~ To: ~[~homas 1~T~un~icr - t~~m_m.~und~r a;a~lnun..~tate.al<.us -. Jim IZ~~~~~ -~~aim_re~~~ a::adillin.~tate.akii~=, ('(`: "~~Vhitacre. Dave S" ~':«-llitacred~ci~unocal.co~ll~~, "Sr~letanka, fel~(~~~~" --~nletankaj~,~r;chvvrun.~~~m=~ "Dolan. Jcff~ i" <d~~lan~j~:u chc~rc~n.c~»il . ~',. ~~i3~D~~ ~~ Hi Tom & Jim, Here is March`s monthly report for the wells requiring pressure monitoring in the PCU #4 Storage reservoir. The PCU # 2 well has been shut-in for some time and is being used to monitor injection zone isolation. We are still having some data retrieval problems with both wells. Inside the database, both production and injection tables will need to be accessed and this is causing some ofi our problems with the zeros' being missed as null characters. We'll get it figured out before the next report. Bottom line, I don't see any indication that the storage gas is not being contained in the approved storage area. Larry «Master Well List Wavered Well Report Mar 2006 prelim.xls» !Master Well List Wavered Well Report Mar 2006 prelim.xls Master Well List Content-Description: Wavered Well Report Mar 2006 prelim.xls Content-Type: application/vnd.ms-excel Content-Encoding: base64 1 of 1 4/13/2006 5:00 PM Plot Pressure & Rate vs Time -Well PCU 4 1600 ;_ _ H~, ~,, _; . _, ~ _ ~, :,~-.,_ ..,_.. 7000 1400 6000 1200 ' ~.~ ~~~ ~9 5/8" Tubing 5000 1000 ~VOL 002 ~ 4000 ~; N 800 ~ d L a 3000 600 2000 400 1000 200 ~ .~ . .. _ ~ ~; 0 p .. __ ~. _ _ . _,__~ _. _ ,x_ ,. ~~_ _ ~n m ca 0 0 0 m ca cfl ca cfl co co co 0 0 0 0 0 0 0 0 ~ co cfl 0 0 i v M O w ~ ~ w n v ~ N N O ~ ~ N \O ~ N N N N M M o n ~ N M M ~ I #30 Fwd: Commencement of Injection Operations - Pretty Creek Storage ... ) ') Subject: [Fwd: Commencement of Injection Operations- Pretty Creek Storage (Storage Injection ,Order #4)] From: John Hartz<jack_hartz@admin.state.ak.us> Date: Wed, 02 Nov 2005 08:56:28 -0900 T·,,',,",, ': IYI':d"· " :'1'0'" ': 1",1'1 ,,',:,', b: ,.:::'lb~::',I'i;.1 ""'il',;:II, I" ':"1' '"I,:, "1..!:~.",I"~"",, "'II"d,'II',;: ,:i',: "tl, I"'t'::'::' :!~II:"':'II"I""':'' ,', ""I,'::,:,,' ":1,,'1"1"/ ",li'"!II::'I,,I'I:II:I:' 'I;,' 'I" II" 1'1' , " I I I I '" I O:JO 'M, 'Q om le''ì:'~1 O,uY:'\CQ oml.ll~ : a mln~ s a e: " ". us=?' II' "iii:",;'," ',\,,':" ::\": " 'I,I¡: I:' ", I'" ' II 'II '11,1 ',I "I III ' il i,' !,J """lil,I'I'II':i!,II,'III'!'~""ill".-;¡:'I'li"'11 )1: ',II'I"'i!i!,'II'IIII,'II,','II' ,~li,:¡:II'~:'I,i "II:::~I:' "":: II" I/"",I'I,!,::"!:III,I,:'I>",¡I!", :1111 II 1'1 '1111 III II! ' , ,,' I' I çp:"mñomasIE':¥~@â~r ~tgm~œ~UJ1Ø~r@8;Wriip¡:~t~t~;~~ *s?,,:ÇathyEo~f,st~~!:::;,(',!il:II:',' I:' ',I, ':1', : 111111' I' I III, " I; , I" '1"""t',,,,'h""I,,"I,I.c: 'II,' "I:"" '1'""'@"'"'"''''d:I''',,'''''''':''''i'i''''' """'i"'I~'1~",,,I""I"" "':1,' 'i'II:",,'II'II"""'I"" '111"","11":1.."1""1,1,,,,1::,, ,,' ,:",,,,,,,' ,1,,,1,: :11,1::,(, "'1""1",1'11111 ""ii, 1,,'11111111'111,,1 ,,1111111,1, I' ,II' '", 11'1 ' II I <,I ca Y loerster ,," a mln.state~é1l\.~us>"iii,"'~:'I,I,,¡ '1::1:',1:1:1, ',,' ','"'''' "I,' "~II ',,' ,,,', ',;'II,!I'I' ,,' ','I, " 1,'"1,,, 'I,", ' , 1,1, , I" ,I ,I' ',', ,_ "",'1,,"" II, ,II,",,""" ",,',' , '",' ,',,, ,,',1'1 """,1:,,111.,'1"0111'11:1';', "'11.,·,,1,'1'1".',11""1,,,,1'1,,111:"1.1,',11'" III lill III III I I I Jody, please file this with Storage Injection Order #4. I spoke with Jeff Smetanka this a.m. and the problem VOoC has achieving a 10 day notification is predicting when Agrium will drop demand which will free up gas to inject. This is a good faith notification of commencement of their gas storage injection. The 10 day requirement is not really achievable given the situation. The injection beginning 11/4 is primarily to condition the well and prevent freezing etc. Jack -------- Original Message -------- Subject:Commencement of Injection Operations - Pretty Creek Storage (Storage Injection Order #4) Date: Wed, 02 Nov 2005 08:46:48 -0900 From:Smetanka, JeffW <smetanka:i~unocal.com> To:Thomas Maunder <tom maunder(â?admin.state.ak.us>, "Hartz, John D -AOGCC" ~i ack hartz~admin. state.ak. us> cc: Whitacre, Dave S <whitacred~unoca1.com>, Greenstein, Larry P <greensteinlp~unocal.com> I am writing to inform the commission that Union Oil Company of California intends to commence gas injection into the PCU #4 well on Friday, November 4, 2005. We had originally planned to commence gas storage operations in early October, as indicated in my cover letter containing the sundry request for PCU #4 conversion to storage service, dated September 30th. However, due to a change in gas demand, we have not had sufficient gas supply to source the injection gas. We expect the gas supply situation to change abruptly at some point in the coming weeks or months, when gas demand from one of our customers is reduced. The date that this gas supply/demand change occurs cannot be predicted. We intend to inject a limited amount of gas (1 mmcfd +-) into PCU #4 beginning November 4th to prepare the well for full scale gas storage injection and as a means to deliver gas to the site to provide fuel and to prevent the freezing problems which we are now experiencing during the final stages of commissioning the storage compressor. Please let me know if you have any questions or concerns with this commencement plan. Thank you and regards, Jeff Smetanka Reservoir Engineer Union Oil Company of California 909 West 9th Avenue, Anchorage, AK 99501 Tel 907 263 7622 Fax 907 263 7847 lof2 11/2/20054:08 PM Fwd: Commencement of Injection Operations - Pretty Creek Storage ... ) ) Mobile 907 22~ 6058 smetankaj@chevron.com Jack Hartz, r.E. S . Reservoir neer !\.l.aska Oil & Ga~) C~on::)eI·va.t.:i"on Cornm"is~)i()n 333 West 7th Avenue Suite 100 .i;nchOrë)qe, [>;1< 99.50], rhone - 907-793-1232 - 907-276-7542 Jack Hartz, P.E. <jack hartz@¿adnlin.state.ak.us> Alaska Oil & gas Conservation Commission 20f2 11/2/2005 4:08 PM #29 10/4/2005 ),:75 PM 1 of 1 Storage Development Plan #1.pdfi Content-Type: app1ication/pdf Content-Encoding: base64 ! 390776 YirstSDP _ Approval.pdf Content-Type: application/pdf Content-Encoding: base64 .............................:::.:::::::::::::::::::::::::::::::::::'::::::';":::::":::'.'::':::':::'::::':::::::'::":::::::'::::'::::::::::::::':,'.':'::::::.'::'::':::::::::::::::::::.1 Brian Havelock Natural Resources Specialist Division of Oil & Gas Alaska Department of Natural Resources 550 West 7th Avenue, Suite 800 Anchorage, Alaska 99501 http://www.dog.dnr.state.ak.us See attached DNR approval, and thanks to everyone who worked on this. Brian 269-8807 Subject: Pretty Creek Gas Storage Faci1ityFirst Storage Development Plan approved From: Brian Havelock <brian_havelock@dnr.state.ak.us> Date: Tu~,040ct 2005,09:25:4~ -,0800, . . ... '." . ... . ..". ..' æ~~smetarikaj@unoca1.cotn,..·keýìn·~abl~·,<tablerk@un~cat.CQin>,..matt~rader@)drir ~state.àk~lls~ )Ken [H~µnQløt,_~k~n~helrr1Q14@dnr~st~t~.ak.~s~,jQD11e_sleJ.no~~C$<Þy;.st.3;tç.ak.us,·'~p~Ì;il~:œW¡e)'t;.::. ..... ':.. .- ¡~pirtle~båte's@d~n\state.ak.us~, :~LiSa:I<irsch'·<1isa~kirS~h@~aw~.stât~·~akJìS>; nJiìrts :(Jim S}" . - <j,~~_ßt()~ffer@dpr.~tate~~.u~~~ b~lL.Y~~dY~~@d:nr.~tate.~.µs~M~:Schultz ..' ., ','.. . " ~111~in_sc~u~ti~dnr.:s~~~~·~~~~,4~~(L.coU~Y@91J.r.·s~ate.lll<~~~'?JÞÍ?11 N9rnuni:_,.. ..... .... i !.,' ::<':, ; . <jQhr1_norman@adriiin.·~tate~~.uS>,'T6ri1·Maunder~tò1Ì1.:)naUndèr@admin.·sÚlte~al(.'vs>, J ohnHârtz -- ,,'.j _ .' \,,'.,: '" '"." "",' .'1 ,:0",:'" ",'I:' '" '" r " 'I' "I.: ' . " ' : ,','I" 'I, ' ,", ',' I '"',, " ',' " , " I <9.~clç~h~z@adiI1~.n~~~at~~~~µs~,tJ~~.. Ç9wan' ,<ji~~cow~($<inr!~~at~~a.1{, us::> .. Ç,¢('~ltr9.tJe,é@chIr~st~le·.~~tls:~ _.~ ~.~.. ",.' ".' , 510-4 ) Pretty Creek Gas Storage Facility First Storag rvelopment Plan a... ) ""","" / fì \ ! f, \ ! ¡¡ I \ ~ ;' ~ \ \,' I \"J rn i-I /,' f ¡ ì V{ ~t~ \ ! ¡ \ ^ \ I J '\ rl ¡ 'I V \ L..I \.....L..r'tj FRANK H. MURKOWSKI GOVERNOR DEPARTMENT OF NATURAL RESOURCES DIVISION OF OIL AND GAS 550 WEST 7TH A VENUE, SUITE 800 ANCHORAGE, ALASKA 99501-3560 PHONE: (907) 269-8800 FAX: (907) 269-8938 CERTIFIED MAIL RETURN RECEIPT REQUESTED October 3,2005 Kevin Tabler Land/Government Affairs Union Oil Company of California PO BOX 196247 Anchorage, AK 99519-6247 RE: ADL 390776 First Storage Development Plan Approved Dear Kevin, The Division received the proposed First Storage Development Plan (1 st SDP) for gas storage lease ADL 390776 on September 30, 2005, submitted by lessee, Union Oil Company of California (Unocal). Under Paragraph 12 of the gas storage lease, Unocal must have an approved SDP prior to commencing storage operations, and must submit an annual SDP for Division approval 60-days before the expiration of the previously approved plan. The Division expects to issue this gas storage lease on or before October 5, 2005. ADL 390776 grants Unocal the right to store gas in both the Beluga 51-5 and Sterling 45-0 sands, however, Alaska Oil & Gas Conservation Commission Storage Injection Order No.4 only authorizes injection into the 51-5 sand. Other limitations are prescribed in Injection Order No.4 and Unocal is required to operate the gas storage lease and Pretty Creek Gas Storage Facility (PCGSF) in compliance with Injection Order No.4 and any amendments or revisions. The proposed 1st SDP describes Unocal's plans for the PCGSF, which includes injection and storage of dry odorized gas in the depleted Beluga 51-5 sand during the plan period, and a longer term option to utilize the Sterling 45-0 sand at the facility. Unocal will begin by free-flowing gas from the higher pressure Enstar sales pipeline to the lower pressure storage reservoir. Following installation of additional compression on the Pretty Creek pad, Unocal will then inject gas from the Enstar line into the 51-5 reservoir until it is filled to an estimated capacity of 2.54 bcf. The proposed 1 st SDP also includes reservoir performance monitoring, injection and withdrawal reporting, and a description of the PCGSF that references Division of Oil and Gas Plan of Operations Permit LO/CI 05-14. Unocal plans to operate the PCGSF indefinitely, injecting and "Develop, Conserve, and Enhance Natural Resources for Present and Future Alaskans. " ) ADL 390776 First SDP October 3,2005 Page 2 withdrawing gas as needed to meet daily and annual contract demand. Unocal currently has no plans for commercial storage of gas owned by a third party. Contingent upon lease issuance, I approve the proposed 1 st SDP for ADL 390776 for the period October 1, 2005 through September 30, 2006. The proposed Second SDP will be due in this office on or before August 2, 2006. Under Paragraph 12(b) of the lease, Unocal shall notify the Division of any anticipated changes in a project resulting in alteration of conditions that were originally approved, including: increase in the maximum annual working gas capacity; increase in the maximum daily injection or withdrawal rate; increase in the approved zone pressure; commencement of third-party (commercial) storage; or the installation of additional wells, compression or pipelines. No changes may be carried out without Division approval as stated in the lease agreement. Consistent with the lease agreement, the Division may request additional engineering, geological, or operational data. A person affected by this decision may appeal it, in accordance with 11 AAC 02. Any appeal must be received within 20 calendar days after the date of "issuance" of this decision, as defined in 11 AAC 02.040 (c) and (d), and may be mailed or delivered to Thomas E. Irwin, 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 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 any regional information office of the Department of Natural Resources. Sincerely, ~.£?~-'. Mark D. Myers Director cc: Jeff Landry, DOL John K. Norman, Chair, AOGCC ) ) Unocal Alaska Union Oil Company of California 909 West 9th Avenue, P.O. Box 196247 Anchorage, Alaska 99519-6247 Telephone (907) 276-7600 Fax (907) 263-7698 UNOCALe Kevin A. Tabler, Manager land/Government Affairs September 30, 2005 Mr. Mark D. Myers, Director Alaska Department of Natural Resources Division of Oil and Gas 550 West 7th Avenue, Suite 800 Anchorage, AK 99501-3560 PRETTY CREEK STORAGE LEASE STATE OF ALASKA FIRST STORAGE DEVELOPMENT PLAN FOR ADL #390776 Dear Mr. Myers: Attached for your information and approval is Unocal's First Storage Development Plan for the Pretty Creek Storage Lease. If you have any questions, please contact Jeff Smetanka at 263-7622. ,¡::;J~ Kevin A. Tabler KAT:JWS:dma Attachment CC: Jeff Smetanka Dave Whitacre ) Unocal Alaska Union Oil Company of California 909 West 9th Avenue, P.O. Box 196247 Anchorage, Alaska 99519-6247 Telephone (907) 276-7600 Fax (907) 263-7698 UNOCALe Kevin A. Tabler, Manager land/Government Affairs September 30, 2005 Mr. Mark D. Myers, Director Alaska Department of Natural Resources Division of Oil and Gas 550 West 7th Avenue, Suite 800 Anchorage, AK 99501-3560 PRETTY CREEK STORAGE LEASE STATE OF ALASKA FIRST STORAGE DEVELOPMENT PLAN FOR ADL #390776 Dear Mr. Myers: Pursuant to the provisions of Section 12 of the Pretty Creek Gas Storage Lease, Union Oil Company of California, as Operator, submits the following as its First Storage Development Plan for your approval. I. DURATION This plan shall cover the period from October 1, 2005 through September 30, 2006. II. FACILITY DESCRIPTION The Pretty Creek Storage lease ADL No. 390776 li.mits gas storage operations vertically to two gas reservoirs within the gas storage area, described as follows: Sterling 45-0 Gas Sands and Beluga 51-5 Gas Sands between the measured depth of 4,503 feet and 5,173 feet below the surface of the ground in the Pretty Creek Unit #4 well. Net thickness of the Sterling 45-0 sand is approximately 9 feet and the Beluga 51-5 sand is approximately 16 feet. These two reservoirs are contained within a storage lease area of 1,990 acres. As specified in Storage Injection Order No.4, Unocal will limit reservoir pressure of the Beluga 51-5 sand reservoir to 2000 psi at 3686' NO and a formation pressure gradient of 0.55 psi per foot. At this reservoir pressure, the estimated total ) ) Mr. Mark Myers September 30, 2005 Page 2 capacity of the Beluga 51-5 reservoir is 2.54 bcf. It is estimated that the working capacity of the reservoir with existing wells and facilities is 700 mmcf per year. The PCU #4 well is the sole storage well for the facility and the only well completed in the storage formations. We estimate that maximum injection rates into the PCU #4 well will be approximately 20 mmcfd and average wellhead injection pressures will be 1550 psig. As specified in Storage Injection Order No.4, Unocal will limit maximum wellhead injection pressure to 1900 psig. The attached Figure 1 shows the Pretty Creek Storage Lease and associated infrastructure. The list of relevant facilities (pad, wells, gathering lines, compressors, etc.) was included in the Pretty Creek Storage Operations Plan. III. PROPOSED OPERATIONS A. First Plan 1. Unocal plans to commence gas storage operations within the Pretty Creek Storage lease during the plan period by free-flowing gas from the Enstar system into the PCU #4 well. Unocal intends to initiate this injection as soon as all regulatory permissions have been received. It is estimated that approximately 150 mmcf of gas may be injected in this phase. 2. Unocal plans to install a gas compressor at the Pretty Creek pad during the plan period to allow injection of gas into the PCU #4 well at pressures greater than the pipeline system. The start-up date of the compressor is currently planned for late October, 2005. Injection rates will fluctuate based on supply and demand and injection pressure will not exceed 1900 psi, as specified in AOGCC injection order NO.4. 3. Unocal plans to remove the existing produced water tank from the site and install a smaller tank for shared gas storage and Unit primary production operations. In addition, the existing secondary containment liner will be replaced. The 500 gallon diesel expansion tank will be reinstalled in the same secondary containment in order to reactivate the heat string capabilities of the wells. 4. The plan is to inject gas intermittently throughout the plan period as gas supply allows. With the exception of deliverability testing and short-term events, it is not anticipated that significant volumes of gas will be redelivered from the storage well during the plan period. 5. Unocal plans to commence gas storage into the Beluga 51-5 reservoir during the plan period. Unocal intends to fill this reservoir to original capacity of 2.07 bet during the plan period, and may ) ) Mr. Mark Myers September 30,2005 Page 3 inject additional volumes (estimated additional 0.47 bct) to bring the reservoir pressure up to 2000 psi. IV. OPERATIONS PERFORMANCE AND MONITORING A. Unocal will be providing an annual performance report to the AOGCC, as required under Rule 6 of AOGCC Storage Injection Order NO.4. The first of these will be available in March, 2006 and will be attached to the proposed Second Pretty Creek Storage Development Plan. B. Unocal will measure all gas injected into and withdrawn from the gas storage formation, and keep a record of all injections and withdrawals, as per the terms of the lease and the injection order. Flowing tubing pressures will be recorded on a daily basis. In addition, static tubing pressures and other pressure surveys will be conducted periodically to monitor the reservoir pressure and assess the storage well and reservoir performance. V. EXPANSION I CONTRACTION PLANS A. First Plan There are no current plans to expand the gas storage operation with additional wells or reservoirs. Unocal intends to conduct storage operations solely in the PCU #4 well during the plan period. Performance data from this initial activity and gas supply/demand concerns will influence future expansion plans for the overall storage operation. B. Long-Term Plan Unocal plans to operate the Pretty Creek Gas Storage Facility indefinitely to help meet annual ,and daily contact demand. The AOGCC Storage Injection Order No.4 limits injection to the Beluga 51-5 sand. After one year of injection storage and withdrawal operations have been completed, Unocal will provide a written summary report and meet with the AOGCC to present its findings. At that time, the Commission will render a decision concerning storage injection operations in the Sterling Formation 45-0 sandstone within the PCU #4 well bore. Additionally, maximum wellhead injection pressure is limited to 1900 psi or 20% over initial reservoir pressure or 2000 psig at 3686 feet TVD and a formation pressure gradient of 0.55 psi per foot. Upon satisfactory demonstration of confinement of the storage gas at elevated pressure by P/Z material balance, Unocal may apply to the Commission to increase the reservoir pressure for storage purposes. ) ) =- Mr. Mark Myers September 30, 2005 Page 4 Union Oil Company of California, as Storage Lease Operator, reserves the right to propose modifications to this Plan should conditions so warrant; however, no modifications will be made without first obtaining permission from the appropriate governmental agencies. Very truly yours, UNIO~OIL OMPANY OF CALIFORNIA By:_ JrLi~ in A. Tabler, Manager Attorney-in-Fact APPROVED: ALASKA DEPARTMENT OF NATURAL RESOURCES Division of Oil & Gas This _ day of ,2005 By: KA T:JWS:dma cc: Jeff Smetanka Dave Whitacre ril( ) ) Pretty Creek Storage Lease 19 21 v¡ 23 ADl389934 ADl390103 ) ( ADL063047 ADl063048 ADL058810 30 29 27 26 31 ADL063049 32 ) U.S.S 21561 34 35 ADL032930 PCU4 . 5 4 ADl058813 3' -. '" 2 ADL 390776 ADL058814 LEGEND 8 Gas Storage Lease Boundary Pretty Creek Unit Boundary 7 - Roads - CEA Electric lines - 4" Flowlines - Enstar 20" line 11 ..' . . 1""':''''- . ...'...."'..: _.: ':~'I.·. ~I\.~J.,..;.,.,', ~;~ . .-- d I... , . ..: il' ~ ". -¡' "".'" . - .' .." Miles 0.5 . Figure 1 UNOCAL(; 0.5 I 0.25 0 #28 ) , Chevron . Union Oil Company of California A Chevron Company Kevin A. Tabler Manager, Land & Government Affairs Tel 907.263.7600 Fax 907.263.7698 Cell 907.227-4076 a-mail tablerk@chevron.com VIA HAND DELIVERY AND EMAIL PDF Email: dnr_appeals@dnr.state.ak.us September 26, 2005 Thomas R. Irwin Commissioner, Department of Natural Resources 550 W. 7th Avenue, Suite 1400 Anchorage. Alaska 99501 Re Request for Reconsideration Reconsideration Pretty Creek Gas Storage Lease ADL 390776; Decision Establish- ing the Areal Extent of the Lease Case Reference No. ADL 390776 Contact Name Kevin Tabler Manager, land and Government Affairs PO Box 196247 Anchorage AK 99519-6247 Phone: (907) 263-7600 Email: tablerk@chevron.com Dear Commissioner Irwin: We are in receipt of the Final Finding of the Director respecting Pretty Creek Gas Storage lease ADL 390776 issued by Mark Myers, Director, Division of Oil and Gas, dated September 13, 2005, and cosigned by you. In that document, the Department approved a smaller gas storage lease area than Union Oil Company of California 1 (Union) requested in its May 11, 2005, appli- cation as revised on June 22, 2005. Pursuant to 11 MC 02.030(a), we herewith file this re- quest for reconsideration of the decision only with respect to lands granted as part of the gas storage lease. Basis for Reconsideration 1 Until August 10, 2005, Union Oil Company of California was a wholly owned subsidiary of Unocal Cor- poration. On August 10, 2005, Union Oil Company of California became a wholly owned indirect sub- sidiary of Chevron Corporation. Union Oil Company of Califomia I Chevron 909 West 9th Avenue, Anchorage. Alaska 99501 http://www.chevron.com ) ) Union seeks reconsideration of the lease decision in order to expand the areal extent of the gas storage lease to be reasonably certain that the entire reservoirs which are the subject of the lease are within the lease boundaries. The current state of knowledge concerning the areal extent of the proposed storage reservoirs does not allow precise delineation of the proposed storage reservoirs. This uncertainty was noted during the proceedings on Union's application with the Alaska Oil and Gas Conservation Commission for the gas storage injection order. Enclosed as part of this Request for Reconsideration is a plat showing the expanded storage area interpretation submitted to the Alaska Oil and Gas Conservation Commission on August 10 and 17, 2005. This interpretation was submitted on August 17, 2005, as Exhibit A of the affida- vie of Coleen Shannon, a Chevron geologist, delivered to the Alaska Oil and Gas Conservation Commission which in part states: Due to uncertainties related to reservoir distribution and trapping mechanism, and the quality and quantity of available geologic and geophysical data, two geo- logic interpretations were developed for each proposed storage reservoir (45-0 sand and 51-5 sand). Each geologic interpretation was sized to match the origi- nal gas in place volumes determined from material balance analysis. An ex- panded area was then created by encompassing the areas from each case, add- ing an additional structural contour interval (50 feet) to the total area and drawing the polygon in a manner which assumes that certain faults do not seal. These are the areas depicted on the Map in Exhibit A. Thus the Map shows our current interpretation of the areal extent of the storage reservoirs plus additional area as- suming non-sealing faults plus the areal extent of the contour which is fifty feet lower. It is important to be reasonably certain that the storage reservoirs are encompassed by the leased area. As a result of the geological uncertainties, and the inconclusiveness of the existing data, it is appropriate to provide for the possibility that the reservoir configuration may be shaped differently than the two deterministic cases upon which the gas storage lease decision was based. The decision requires the segregation of the existing underlying oil and gas leases at the boundary of the gas storage lease. The leased area outside of the Pretty Creek Gas Storage Lease will be incorporated in four new separate distinct leases having the same terms as the original oil and gas leases and will continue to be part of the Pretty Creek Unit (PCU). Once the PCU terminates, the new leases created by segregation will also terminate, leaving only the area covered by the gas storage lease and its associated oil and gas leases. 2 The cover letter and affidavit of Coleen Shannon is submitted with this Request for Reconsideration. Because Exhibits 0 and E to the affidavit are CONFIDENTIAL (see the cover letter discussion), Union requests DNR retain those Exhibits as confidential pursuant to AS 38.05.035(a)(9)(C). Union 011 Comp.ny of C.lifoml.¡ Chevron 909 West 9th Avenue. Anchorage, Alaska 99501 http://www.chevron.com ) ) The geological uncertainty combined with the future contraction of the oil and gas leases to co- incide with the gas storage lease area justifies an expanded interpretation that includes suffi- cient lands so as to be reasonably certain that the proposed storage reservoirs are incorporated in the leased area. We met with members of your staff on September 21 2005, to discuss this matter and present the concerns expressed herein. As a result of these discussions, we seek reinstatement of our original proposed gas storage lease outline with the exclusion of the following two (2) quar- ter/quarter sections: SE1/4SE1/4 Section 28 and the SE1/4NW1/4 Section 34 both in T14N- R9W SM. Accordingly, we ask for reconsideration of the September 13, 2005, decision only with respect to the gas storage lease area and request that the following legal description (depicted as Pretty Creek Storage Lease Attached) replace the Department's proposed gas storage lease ADL 390776 legal description: Pretty Creek Gas Storage Lease, ADL 390776 T.13N., R.9W., S.M. Section 3: W1/2NW1/4, NW1/4SW1/4, 120 acres; Section 4: N1/2, SE1/4, N1/2SW1/4, SE1/4SW1/4, 600 acres; T.14N., R.9W., S.M. Section 28: SW1/4, SW1/4SE1/4, 200 acres; Section 29: E1/2SE1/4, 80 acres; Section 32: E1/2E1/2, 160 acres; Section 33: All. 640 acres; Section 34: W1/2W1/2, NE1/4SW1/4, Excluding U.S. Survey 2156, 190 acres; Containing 1,990 acres, more or less. Should you have any questions or wish to discuss this matter further, please don't hesitate to contact the undersigned. Siniely, ·¡~w.wJrI~ ì<J:n A. Tabler cc: John Norman, Chair, Alaska Oil and Gas Conservation Commission Email: john_norman@admin.state.ak.us Mark D. Myers, Director, Division of Oil and Gas Email: mark_myers@dnr.state.ak.us Jeff Landry, Alaska Department of Law Email: jeff_landry@law.state.ak. Union 011 Company of Califomia I Chevron 909 West 9th Avenue, Anchorage, Alaska 99501 http://www.chevron.com ) ) Pretty Creek Storage Lease '<œ ''''II'''' , , I" . "~C""""'''\r 22 23 31 \ "- 20'~ ~ "~ 1 ''''' I ,"""'1".1 \ 29~n - "l 28 III~ ~II ''--,\ \ ~z ~ ~ --~ \ / ( ~~ ) 33 V34 · ~ ,/'~_/' T14N RfW f T13N RtW ( - 1.1/ ......,,_,,_~,_,__k_,.... 6 ' 21 19 1 30 26 ,; 32 5 4 J 3 2 d J 1oiiII....¡¡¡¡¡'-,' '-'''-""-"'''~'--·"lii.!ìi.¡B¡''''I'''-- '"."'" , _,.< r\"""~""'-"Ir>''I:L'~'-I_'n'''''·'"''''''~-''''''''''''''''.J LEGEND . Pretty Creek Well Pad LJ Gas Storage Lease Bou ndary [~:-"=,"1 Pretty Creek Unit Boundary - Roads 9 10 11 0.5 I 0.25 0 0.5 I UNOCAL~ Miles ) " UNOCAL. Marc D. Bond Assistant Counsel Law Department Tel 907.263.7813 Fax 907.263.7607 Cell 907.229.5750 mbond@unocal.com August 17, 2005 .~ RECEIVED i\~~ AUG 1 7 2005 <ec, y VIA HAND DELIVERY John Norman, Chair Alaska Oil and Gas Conservation Commission 333 W. 7th Ave., Suite 100 Anchorage, Alaska 99501 Alaska ail & Ga$ Cons. Commission Anchorage Re: In the Matter of the Application of Union Oil Company of California (Unocal) for a Stor- age Injection Order. Pretty Creek Gas Storage Facility Dear Chair Norman: During the hearing on August 10, 2005, and in response to concerns expressed by Trading Bay OU & Gas LLC representatives concerning the possible effect of the proposed storage on its acreage to the north of Pretty Creek, Unocal projected a map of the Pretty Creek Unit (the "Map"). The Map was later filed with the Commission. Unfortunately, we may have left the Commission with the misimpression that Unocal's current interpretation is that the areal extent of the proposed storage reservoirs is coincident with the two colored areas on the Map. As we do not want to leave the Commission with that possible misimpression, we submit the enclosed affidavit of Coleen Shannon and attached exhibits. The exhibits attached to Ms. Shannon's affidavit include two drawings, sealed in a separate en- velope, which contain confidential information. These are Exhibits D and E, which have been marked jn red as "UNOCAL CONFJDENTJAL" at the top and "CONFJDENTJAL" at the bottom. The confidential and proprietary nature of the information shown on Exhibits D and E is the con- tours of the sands shown in the exhibits. These are interpretations based upon well logs. seis- mic data and other confidential information held by Unocal. Both th~ interpretations and the data upon which they are based provide Unocal with independent actual economic value by not being known or readily ascertainable by other persons. As with all oil and gas companies, Uno- cal takes reasonable and significant efforts to maintain the secrecy of this information. Accord- ingly, this information is within the definition of "trade secret" In AS 45.50.940(3). Union 011 Company of Callfoml. I Unoc.1 Alaska 909 West 9th Avenue, Anchorage, Alaska 99501 http://www.unocal.com ) ,) John Norman, Chair August 17, 2005 Page 2 Since Unocal is submitting Exhibits D and E voluntarily, the request for confidentiality may be proper under 20 MC 25.537(b). However, since the materials are submitted in connection with a hearing held on Unocal's application for a storage injection order, our request for confidential- ity may be more appropriately handled under 20 AAC 25.540(c)(10). Unocal respectfully re- quests that the Commission maintain Exhibits D and E as confidential and not available to the other parties attending the hearing or to the public generally. ¡{::.~ Marc Bond Union 011 Company of Callfomla / Unocal Alaska 909 West 9th Avenue, Anchorage. Alaska 99501 http://www.unocal.com ) ) ALASKA OIL AND GAS CONSERVATION COMMISSION Before Commissioners: John K. Norman, Chairman Daniel T. Seamount Cathy Foerster .~~ RECEIVED (O-i!\vX AUG 1 7 2005 '¡i.ÿ AI~Aka ail & Gas Cons. Comn1ission Anchorage In the Matter of the Application of UNOCAL for a Storage Injection Order, Pretty Creek Gas Storage Facility AFFIDAVIT OF COLE EN C. SHANNON STATE OF ALASKA ) ) ss. THIRD JUDICIAL DISTRICT ) Coleen C. Shannon declares the following to be true under penalty of perjury: 1. I am a geologist engaged by Union Oil Company of California (Unocal) in the position of Advising Geologist in the Unocal Alaska business unit. I provided testimony before the Com- mission on this matter on Wednesday, August 10, 2005, including testimony respecting my ex- pertise in the area of petroleum geology. I have a bachelor of science degree in geology from Mount Holyoke College and a master of science degree in geology from Stanford University. 2. During the hearing on August 10. 2005. and in response to concerns expressed by Trading Bay Oil & Gas LLC representatives concerning the possible effect of the proposed stor.. age on its acreage to the north of Pretty Creek. Unocal projected a map of the Pretty Creek Unit (the "Map"). The Map was later filed with the Commission and is attached to this affidavit as Ex- hibit A. At the hearing, I described the Map (which depicts two colored areas) as follows: What this shows is what we believe to be the extent of the 45 0 and 51 5 sands in the vicinity of the wells in the Pretty Creek Unit. The orange color would be the 51 5 and the magenta color would be the 45 0 sands. And those are the extents. Now this not specifically a structure map, but it gives you a sense for what we do believe the extent is of these sands. 3. In response to questioning by Commissioner Foerster, I furthered described the method for developing the Map as follows: Pretty Creek Gas Storage Facílíty Affidavit of Coleen C. Shannon Page 1 ) [W]e took an approach where we looked at a number of cases, two cases in each way, one where there was a structural component associated with the trap and two, where there was a stratigraphic only component to the trap. So what we did was we mapped out net sand above a lowest known gas level and mapped that sands in both cases and then went to the next contour Interval, 50 feet down, and drew a boundary around the two cases and what and that's what you're seeing here, is the extent of a boundary around the two cases for each of the sands. As- suming that you have a single net sand map, a lowest known gas level defined by Pretty Creek 4 and a structure map that on each at the top of each of the sand maps. 4. During the hearing, in response to questioning by Chairman Norman, Jeff Smetanka of Unocal testified respecting the Map as follows: CHAIR NORMAN: So, Mr. Smetanka, so I understand then, the orange or tan or- ange is superimposed on top of the magenta boundary there and that depicts the geographic limits of what you expect the reservoir to be, is that correct? MR. SMET ANKA: That's correct. 5. Unfortunately, I believe we may have left the Commission with the misimpression that Unocal's current interpretation is that the areal extent of the proposed storage reservoirs is coin- cident with the two colored areas on the Map. The purpose of this affidavit is to correct that pos- sible misimpression. 6. The two colored areas on Exhibit A are larger than our best estimates for the storage areas. The Map was developed as part of a slide presentation in connection with our work with the Department of Natural Resources, Alaska 011 and Gas Division, in determining the most ap- propriate storage lease area for the project. Due to uncertainties related to reservoir distribution and trapping mechanism, and the quality and quantity of available geologic and geophysical data, two geologic interpretations were developed for each proposed storage reservoir (45-0 sand and 51-5 sand). Each geologic interpretation was sized to match the original gas in place volumes determined from material balance analysis. An expanded area was then created by encompassing the areas from each case, adding an additional structural contour interval (50 feet) to the total area and drawing the polygon in a manner which assumes that certain faults do not seal. These are the areas depicted on the Map in Exhibit A. Thus the Map shows our cur- Pretty Creek Gas Storage Facility Affidavit of Coleen C. Shannon Page 2 ) ) ) rent interpretation of the areal extent of the storage reservoirs plus additional area assuming non-sealing faults plus the areal extent of the contour which is fifty feet lower. 7. To correct possible misimpression respecting Unocal's view of the proposed storage sands and to provide more information to the Commission, I have directed the preparation of five drawings and have attached these drawings to this affidavit as Exhibits B, C, D, E, and F. 8. As I previously testified, given the uncertainties concerning the extent of the reservoirs, I analyzed the data and developed two interpretations (Case 1 and Case 2) for the 51..5 sand and two interpretations (Case 1 and Case 2) for the 45-0 sand. Attached to this affidavit are drawings which show these interpretive cases both with and without the structural contour lines. Exhibit B shows the two cases I prepared for the 51..5 sand. Exhibit C shows the two cases I prepared for the 45-0 sand. Exhibit D shows the same 51-5 sand areas from Exhibit B super- imposed on a 51-5 sand structure map. Exhibit E shows a similar display for the 45-0 sand. Be- cause Exhibits D and E convey highly proprietary information and interpretations, Unocal is pro- viding the commission these figures with the understanding that they will be held in strict confi- dence and not be released to the public. Finally, I directed the preparation of an additional draw- ing, Exhibit F, which combines the cases for the 45-0 sands and the 51-5 sands in a single draw- ing. Exhibit F is the proper substitute for the Map shown at the hearing. 9. I apologize for any misimpression we may have created. I am available to answer any Date: I: h~ to<> 5 thi affidavit and the attached additional questions the Commission may have afte materials. --...... The foregoing was subscribed and sworn to or affirmed %:- ~~ of August, 2005. Notary Public In and for the State of Alaska My Commission Expires: (; · ~q . O~ Pretty Creek Gas Storage Facility Affidavit of Coleen C. Shannon Page 3 ) : ..; ~36I~'iO;~ . . ; I; :~;t~.·;: I : : . ..~.~ : ...: : I . ,I P:retty ICree:k un.·.lt:· ..·..p:r:O\DIO. "8. .ad.. ',..,.... IG.·· .,:1:8..9,'." :O;~. aiae.i .....IA..,reas, I x'" ... ...L"'"":''''-~-iI'I-K-~-('''11 n .i I )( I )( J )( X-x-xl I' X .x-)(~"~ II X' I ,j:,,::,I:I"':"': II:':""'I"~,':I,;",,I)('::I:I"~III" ~- I :s - :>: jij- I )( J x I )( , ';I( Ii X :1' X ~ :,: ")( II :x I X II X: , X ~ ,X I X I I Iii X -,-,-,L."X-M-*-M;-)(· ..)f ,')( J' ..... Je Pretty Creek Unit Boundary ) 3:.:1tOO(11 . I'. :"': I .", )( ......~ u t( .M- ~< ??oo 3JOOO 4400 5Øo~n I I I I 1 :31)000 I I , 34QOOO j: N- 8- ~- fj. i~ ~. )~ .f -tC .. M. S ~~ t 10tJ() WWW - PCU..01 . 33tW4Ó . . . I . . . ~"oo . . . I . . . 3~ - -- ~ ~I I- .... - - w ~, , " , I :=: k :1 - - I, ....' ""'" ..... .. ..~ - r,X-X1 ':,X ¡ ~ )( M ~c J \11II" - ... ~ . ~ I' i 'w i_ :~ :~ .. - .... .- )(. I x I x 1 x ~i :1 ~I .§ EXHIBIT A )) Pretty Creek Gas Storage ReservoÎr Area 51-5 Sand Cases 1 & 2 20 21 22 23 PRETTY CREEK UNIT II I ~~¡ . :~291_~~ I 28 27 II"'cJ ~ 1M '1-3 ,~ M M ¡~ , c: Z I~ _,~' ~ i'! Z ~ 1",,11 W WJ ex:; , u ~ 32 E-i \ÏI, æ ~. I I· I 1':"1 T14N R9W II T13N R9W Ji 5 ~"III ì I 34 '~35 I ..... r I I :_J 3 I ~ I 2 ~ ¡~ \ "' '-"'''"''''.I''.,=....'!l'=~'I''~--'-''''''''''"~',-., """".... _, .',,, ",'''''''''' I ~"'~~~l!!cm&~."ll'll'!l'ftllo!,ftIIIII'.,.~'W.i'iij 1..~~¡¡,.ri.~~~¡-';lfI,,"JI'ß.r-'~1oo.,;,".~~(~I' "'_'I~""~U . ·1J.::.'L'.:'~:I-joa,~+'·'l'I.jIIlJIIfIIÞ'I'~~""':I""""""\-"UI~ ~ - PRETTY CREEK UNIT C Pretty Creek Unit 9 10 11 . PCU 51-5 Case 1 . PCU 51-5 Case 2 UNOCALt!> 0.5 0.25 0 0.5 EXHIBIT B I I Miles · ) ). A Pretty Creek Gas Storage Reservoir rea 45-0 Sand Cases 1 & 2 20 21 22 23 PRETTY CREEK UNIT lI:.IINI.i~'lltill~IIIIII~III'I'I.,~IAJ~~lt:",,:II,ll"""\''''1,:II,tC'II..~_~,',l:-~';,; ;'~i~r,;,,,,M'ï:;I,:,::::,:,::Jbtti'" ,"rJ,,:I, ;¡¡¡~:":,:,,::~::\~;;:,;~~~~t~ 28 27 l. ~ 1-:3 ., 1-:3 ~ "1 (1 l~ I ~ I d Z H 11-:3 5 II i' E-i I H Z 8 ~ ~ l' ~,j E-i I E-i ~ 1'1111 W II æl1 111' ¡!~ T14N R9W 1\ Irl'i T13N R9W ,,!,I: ~ i d ,Iii! I 32 34 35 'ft.SIIIIIII J ,'I :-.1 i~ !J i ,'ì I l f ~4 I I I~L~"¡','''··''''··'''·~'W'=''''"'''''''''''''''''''''-''~"'''.\''''''''''-'-_'l.''''-"' ""'~I~_,......, "." ". _, II't'r.r~"""''"'"_''''~'''-_'''~_''",T""",,,,,,,,,,_.,,'V~,,,n-~!Ii.'_''~:'~'"'''·''''''' ",~,~",·,"·Itf'""···1":::~~:~;¡¡~~'~~'11!"""-'I>1"'''' ~ ~ 3 f , 2 PRETTY CREEK UNIT C 9 10 Pretty Creek Unit 11 _ ''N. D PCU 45-0 Case 1 D PCU 45-0 Case 2 UNOCAL{i> 0.5 0.25 0 0.5 EXHIBIT C I I Miles ') ) CONFIDENTIAL EXHBITS D and E In the Matter of the Application of Union Oil Company of California (Unocal) for a Storage Injection Order, Pretty Creek Gas Storage Facility EXHIBITS D and E are FILED UNDER SEAL ) Pretty Cr~ek Gas Storage Reservoir Area 45-0 and 51-5 Sand Overlay 20 21 22 23 PRETTY CREEK UNIT I ~ ~ , ~~ 2911111J!tii , 28 27 '"tJ ::0 tr:J 1-3 11-3 K; o , ,.., I ~ ~ c: Z H f-3 ~, 32 E-t t:iI æ! 1"111' '111111 " \I~ ~¡-:,I: HI S ili ~' Ejl ex: II ul ~ I' I 5 \1 1II1 \11 ',. .,,1,,1\ : \ \ ) 33~'J' 1~1j", ~r 1 1, , .!oJ · i ~ - I ~I 1t f- l 1 ' ,t ' . .. .. - II I , "~ 'I '" .~ " 1 r 34 I' ¡"""'I"""''''''''I. 35 I :¡ T14N R9W -~I 1:,1 T13N R9W ~ I \ I ,I I, II I ,'I ~! , ~ ~l I .} "i¡ ,~ I '1 1 J l,,,,,,,,,,=!I'~::::;::'~';:;"'"'"'''~='''''''''""''~~_'''''''''''''''~"'''''''''''''''r::Jl!!''.J'=-"~n_'''~,'-'''''''.~'~.~.''''',,..,, ""--'r-"__"~~-~~'._"""__~""""""_"'.__'_"",,' ", ".''';',' " -l_II.IIIi~~~""7"'r.~!II!!.r~i?!"Il'.~~I"'I' ",~,,,,.,,,,,..,.~ .~"""~.!!III~....'!'II.~.- .;;;0-....... ~"', li'¡;';¡, "_lIIf-"¡;¡'iJ.I ir,v'''''''''''-' ""._~_-I' ~~I'o,u,·'''' PRETTY CREEK UNIT 3 ¡r' 2 C Pretty Creek Unit . PCU 51-5 Case 1 . PCU 51-5 Case 2 D PCU 45-0 Case 1 D PCU 45-0 Case 2 UNOCAL(t) 9 10 11 0.5 I 0.25 o 0.5 I EXHIBIT F Miles #27 ©~&~~ Qi')&~©'Zß DEPARTMENT OF NATURAL RESOURCES DIVISION OF OIL AND GAS Ft'.111K H. MURKOWSKI, GOVERNOR 550 WEST 7TH A VENUE, SUITE 800 ANCHORAGE, ALASKA 99501-3650 PHONE: (907) 269-8800 FAX: (907) 269-8938 SEP 1 if) 2005 September 14, 2005 NOTICE OF ISSUANCE OF GAS STORAGE LEASE BEST INTEREST FINDING AND FINAL CONSISTENCY DETERMINATION The Department of Natural Resources (DNR), Division of Oil & Gas (division) gives notice under AS 38.05.945(a)(3)(B), that it plans to issue a Gas Storage Lease (ADL 390776) to Union Oil Company of California (Unocal) within the Pretty Creek Unit on the west side of Cook Inlet. The lease is entirely within the Matanuska-Susitna Borough and contains 1,640.00 acres of state-owned mineral estate. Annual Fee Unocal must pay a fee of $25,000.00 per year. Lease Term The lease has a primary term of ten (10) years. Lease Form The lease will be executed on Gas Storage Lease Form # DOG200509. Best Interest Findine On September 13, 2005 the Director, Division of Oil and Gas (director), issued a final finding and decision under AS 38.05.035(e), with the concurrence of the Commissioner, Department of Natural Resources. This finding sets forth the facts, policies, and laws upon which the determination was made. The Best Interest Finding and Final Consistency Determination are available on the division's Website: www.dog.dnr.state.ak.us/oil. Copies of the finding are also available for public review at the division's offices, the Matanuska-Susitna Borough offices, as well as the Loussac Public Library in Anchorage. Individuals may obtain copies of the finding and consistency determination from the division: 550 West 7th Avenue, Suite 800; Anchorage, Alaska 99501. To order, call Anna Motschenbacher at (907) 269-8814, or e-mail atAnna_Motschenbacher@dnr.state.ak.us. Miti2ation Measures AS 38.05.035(e) and the departmental delegation of authority provide the director the authority to impose conditions or limitations, in addition to those imposed by law, to ensure that the disposal best serves the interests of the state. To meet this requirement, the director has adopted Mitigation Measures and Lessee Advisories that impose standards of conduct that must be met and inform the lessee of possible future limitations. These measures and advisories are deemed necessary to protect biological, cultural and archeological resources as well as to mitigate social impacts. These measures will be enforced throughout the lease term. "Develop, Conserve, and Enhance Natural Resources for Present and Future Alaskans." Reconsideration and Appeal This finding is a final administrative decision of the department. A person affected by this decision who provided timely written comment or public hearing testimony on this decision may request reconsideration, in accordance with 11 AAC 02. Any reconsideration request must be received by 5:00 p.m. (local time), October 3,2005 and may be mailed or delivered to Tom Irwin, 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 . If reconsideration is not requested by that date or if the commissioner does not order reconsideration on his own motion, this decision goes into effect as a final order and decision on October 14, 2005. Failure of the commissioner to act on a request for reconsideration within 30 days after issuance of this decision is a denial of reconsideration and is a final administrative order and decision for purposes of an appeal to Superior Court. The decision may then be appealed to Superior Court within a further 30 days in accordance with the rules of the court, and to the extent permitted by applicable law. An eligible person must first request reconsideration of 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 any regional infonnation office of the Department of Natural Resources. The State of Alaska, DNR, Division of Oil & Gas complies with Title II of the Americans with Disabilities Act 1990. This Publication will be made available in alternative communication fonnats upon request. Please contact Anna Motschenbacher at (907) 269-8814 to make any necessary arrangements. ~£?Ø5-. Mark D. Myers Director STATE OF ALASKA DEPARTMENT OF NATURAL RESOURCES DIVISION OF OIL & GAS 550 W 7TH AVE, SUITE 800 ANCHORAGE, AK 99501-3560 $ OO~·3,1° C (II G .:13 :~1 SE F' 5 2 10 0 5 ~ F,/¡pjU:::.D FROM ZIP C:,ODE '~'3S0 1 AOGCC 333 W 7T HAVE #100 ANCHORAG A E AK 99501-3539 ) ) ¡Ii #26 e: agency cooperation on Pretty Creek ) ) Subject: Re: agency cooperation on Pretty Creek From: John Norman <john_norman@admin.state.ak.us> Date: Wed, 14 Sep 2005 18:25:35 -0800 To: brian_havelock@dnr.state.ak.us Thank you Brian. It is always a pleasure to work with you and the other professionals at DNR. John Brian Havelock wrote: Commissioner, I wanted to take a second to thank you and your staff for coordinating with DNR on issuing our respective authorizations for gas storage at Pretty Creek. For many reasons, it is important that we work together to ensure Injection Orders are consistent with the Storage Lease; a chicken and egg situation. We shared information, held joint technical meetings, and conferred with each other on the key issues. The same cooperative effort is now underway for the storage injection Lease and Order at Kenai River Unit. Although applicants rarely express appreciation for saving time and avoiding duplication, I think the public would be glad to know we worked together to make defensible decisions and ensured everybody's rights are protected. Brian Brian Havelock Natural Resources Specialist Division of Oil & Gas Alaska Department of Natural Resources 550 West 7th Avenue, Suite 800 Anchorage, Alaska 99501 b!!.p:/ /www .dog.dnr.state:-ª.~~~~ John K. Norman <John Nonl1an~~adl11in.state.us> Commissioner Alaska Oil & Gas Conservation Commission 1 of 1 9/15/2005 9: 16 AM #25 ) ~ ; Pretty Creek Gas Storage Lease ADL 390776 Final Finding of the Director Prepared by Alaska Department of Natural Resources Division of Oil and Gas Anchorage, Alaska September 13, 2005 ) Table of Contents Introduction............................................................................................................. 1 Statutory Background............................................................................................. 2 Scope of Review..................................................................................................... 2 Public Process......................................................................................................... 4 Comments on Proposed Gas Storage Application .................................................. 5 Alaska Coastal Management Program.................................................................... 6 Material Facts and Issues........................................................................................ 7 Environll1ental Impacts................... ........................................................................ 8 Analysis of State Benefits....................................................................................... 9 Best Interest Determination.................................................................................. 10 Attached: ADL 390776 Gas Storage Lease (including Mitigation Measures and Lessee Advisories...................................................................................... 14 ) Introduction On May 13,2005, Union Oil Company of California (Unocal) applied to the Alaska Department of Natural Resources (ADNR), Division of Oil and Gas (Division) for a gas storage lease under AS 38.05.180(u) and 11 AAC 83.500-520. The application included a proposed form of storage lease and $50 application fee as required by 11 AAC 83.520 and 11 AAC 88.105. Unocal revised the application, specifically the proposed lease area, on June 22, 2005. Additionally, Unocal supplied pertinent geological and geophysical data to support the application, which are held confidential under AS 38.05.035(a)(9). Unocal applied to store natural gas in two reservoirs within a gas storage area utilizing an existing gas well and facilities located approximately 30 miles west of Anchorage in the Susitna Flats State Game Refuge (SFSGR). The State of Alaska (state) owns all of the lands within the proposed storage lease. The proposed storage lease is within the Pretty Creek Unit, and is subject to state oil and gas leases owned and operated by Unocal. The Pretty Creek Unit is connected to the Cook Inlet gas pipeline grid system via Enstar Natural Gas Company's 20-inch gas pipeline traversing the unit area. Unocal must obtain approval from agencies with jurisdiction, including the Alaska Oil and Gas Conservation Commission (AOGCC), prior to any gas injection. This decision approves a smaller lease area than Unocal requested in its application. The approved storage lease area includes 1,640.00 acres in the following state lands: T. 13 N., R. 9 W., Tract A, Seward Meridian, Alaska Section 3, Unsurveyed, Wl/2NWl/4, 80.00 acres; Section 4, Unsurveyed, Nl/2, Nl/2SWI/4, SE1/4SWl/4, SEl/4, 600.00 acres; T. 14 N., R. 9 W., Tract A, Seward Meridian, Alaska Section 28, Unsurveyed, Wl/2SWl/4, SEl/4SWI/4, SW1/4SEI/4, 160.00 acres; Section 32, Unsurveyed, El/2El/2, 160.00 acres; Section 33, Unsurveyed, WI/2NE1/4, SEI/4NE1/4, NW1/4, SI/2, 600.00 acres; Section 34, Unsurveyed, SWI/4SWI/4, 40.00 acres; The lease limits the gas storage area vertically to two gas reservoirs within the gas storage area, described as follows: Sterling 45-0 Gas Sands and Beluga 51-5 Gas Sands between the measured depth of 4,503 feet and 5,173 feet below the surface of the ground in the Pretty Creek Unit #4 well, the surface wellhead of which is located in Section 33, Township 14 North, Range 9 West, Seward Meridian, Alaska. Issuance of this gas storage lease will extend the terms of four oil and gas leases: ADLs 58810, 63048, 63049, and 58813, issued by the state, the sole owner of the mineral ) ) estate under AS 38.05.180(u). Underlying oil and gas leases have either a fixed 12.5 percent or 16.667 percent royalty rate and their primary terms have been extended by ADNR indefinitely by unitization. Unocal agrees to segregate these leases at the gas storage lease boundary, creating four new separate and distinct leases outside the gas storage area having the same terms and conditions as the original leases within the gas storage area. Statutory Background The proposed gas storage lease will dispose of an interest in state land. Under AS 38.05.035(e), an ADNR director must make a written finding that a disposal of state land, resources, property, or interests will serve the best interests of the state. This best interest finding is a written analysis which describes for the public the facts and applicable law which are relevant to the disposal and gives a decision based on these factors. The finding must also discuss material issues that were raised during the period allowed for receipt of public comment. The Director must make this written finding public at least 21 days before issuing the storage lease. Under AS 38.05.180(u), the Commissioner of ADNR may authorize the subsurface storage of oil or gas to avoid waste or to promote conservation of natural resources. It does not matter whether the oil or gas is produced from state land, so long as storage occurs in land leased or subject to lease under section AS 38.05.180. An oil and gas lease on which storage is authorized shall be extended at least for the period of storage and so long thereafter as oil or gas not previously produced is produced in paying quantities. By memorandum dated September 2, 2004, the Commissioner approved a supplement to Department Order 003, and delegated the authority to authorize subsurface storage to the Division Director. This written finding meets the requirements of AS 38.05.035(e) for the authorization and issuance of gas storage lease ADL 390776 to Unocal. It describes for the public the facts and applicable law which are relevant to the disposal and sets forth the decision based on these factors. This finding also discusses material issues that were raised during the comment period. The attached gas storage lease, ADL 390776 grants the lessee the exclusive right to store gas and associated substances in the gas storage formation reservoirs and area identified in Exhibit A to the gas storage lease, subject to the lease terms and applicable statutes and regulations, including mitigation measures and lessee advisories incorporated by reference into the lease. Scope of Review The scope of this administrative review is limited to reasonably foreseeable, significant effects of the disposal or leasing phase of this activity as set out in the attached lease. This review is limited to applicable statutes and regulations; material facts 2 ) pertaining to the land, resources, or property, or interest in them; and issues that are material based on the statutes, regulations and facts. Accordingly, the division has considered some generalized activities following issuance of the gas storage lease that are reasonably foreseeable and expected within the initial ten-year term of the lease. Unanticipated future uses or operations, however, are beyond the scope of this review and will be subject to future public reviews and authorizations by the state. ADNR is allowed to review projects as "multi-phased development, "when three conditions are met (AS 38.05.035(e)(l)(C»: (a) the only uses to be authorized are part of the discrete phase being reviewed; (b) ADNR's approval is required before the next phase may proceed (i.e., a plan of operations or permit must be authorized before another phase or segment may begin); and (c) ADNR describes its reasons for allowing phased review and conditions the approval to ensure that any additional uses or activities proposed for that or any later phase will serve the best interests of the state. Phased review is based in part on the fact that some multiphased projects are subject to continued review throughout the succeeding stages. Phased review is intended to allow for consideration of subsequent issues when sufficient data are available upon which to make reasonable decisions. Future phases cannot be reviewed with any accuracy when information regarding future activities is unknown, nonspecific, undefined, unavailable, or unreliable. Condition (a) is met because the proposed gas storage lease gives the lessee the right to conduct storage activities, it does not authorize other activities by the lessee on leased area. Before any operation may be undertaken on the leased area, the lessee is required to comply with all applicable statutes and regulations, and secure approval of a plan of operations and all applicable permits. Condition (b) is met because state approval is required before the next phase may proceed. Before new activities can occur on leased lands, the lessee must secure all applicable permits. Additional permits must also be prepared, and approved by the state, for any later development or production phase. The plans of operation must identify the specific measures, design criteria, construction methods, and standards that will be employed to meet the provisions of the lease. Plans of operation are subject to extensive technical review by a number of local, state, and federal agencies. They are also subject to consistency with the Alaska Coastal Management Program (ACMP) standards, if the affected lands are within the coastal zone. The plans are available for public review upon submission to the state. Oil and gas storage-related activities will be permitted only if proposed future operations comply with all borough, state, and federal laws and the provisions of the lease. Condition (c) is met because ADNR is conditioning this best interest determination and the leases with a number of mitigation measures designed to ensure 3 ) \ } that any future activities in the exploration, development, and production phases will serve the best interests of the state. These mitigation measures have been developed by ADNR through its review of the material facts and issues, including the reasonably foreseeable cumulative effects of storage in the lease area. Therefore, the scope of review in this finding is limited to the applicable statutes and regulations; the material facts and issues that are known to the director that pertain to the storage lease phase; and the reasonably foreseeable, significant effects of gas storage. This includes all of the items referenced on the list in AS 38.05.035(g) and all material facts and issues raised by the public during the public comment period. Specific future storage activities will be considered at each phase, when permit applications for specific proposed activities at specific locations are reviewed by various government agencies and the public. Every individual activity on the proposed storage lease is or has been subject to public review and agency permitting. Public Process On June 24, 2005, in compliance with AS 38.05.945 the Division issued a public notice (Notice) of receipt of a gas storage lease application, and included in that notice, in compliance with AS 46.40.096(c), notice that the proposed storage area is within the Matanuska-Susitna Borough (MSB) Coastal Resource District. The Notice was published in the Anchorage Daily News, Peninsula Clarion and The Frontiersman on June 24, 2005; posted on the state public notice website and on the Division's website; and sent to interested parties on the Division's Cook Inlet lease sale mailing list, including public libraries, federal, state, and local governments, non-governmental organizations, and electric and natural gas utilities. The Notice established a public comment period which ended at 5:00 p.m. on July 25, 2005. The Notice called for comments on the application's consistency with the ACMP, including the enforceable policies of the Matanuska-Susitna Borough (MSB) Coastal Resource District's Coastal Management Plan. The Notice stated that the proposed gas storage lease would be a phased activity under AS 46.40.094(a)(2), requiring additional permits and an ACMP review, including an opportunity for public comment, for any future development activities. Comments relative to ACMP consistency were required to identify the enforceable policy or standard at issue and explain how the application is inconsistent. In addition to the general public notice, the ACMP review package was mailed to ADNR's Office of Project Management and Permitting (OPMP), Office of Habitat Management and Permitting (OHMP), Division of Mining Land & Water (DML W), and State Historic Preservation Office (SHPO), the MSB, Joint Pipeline Office, Alaska Department of Fish and Game (ADFG), Alaska Department of Environmental Conservation (ADEC), Alaska Oil and Gas Conservation Commission (AOGCC), and the applicant, Unocal. In addition, the Notice called for separate comments under AS 38.05.035(e) regarding whether the issuance of the proposed storage lease that would best serve the 4 ) ) interests of the state. To be eligible to appeal this final finding, a person must have provided written comments during the comment period as stated in the Notice. The Division received comments from ADFG, the MSB, Enstar Natural Gas Company, and Trading Bay Oil and Gas, LLC. These comments are addressed below. Comments on Proposed Gas Storage Application The Mat-Su Borough found the proposed disposal to be consistent with the MSB Coastal District's Coastal Management Plan, and requested that within the District's 75- foot shoreline setback, all areas not occupied by allowed development must minimize disturbance of natural vegetation. This stipulation will be placed into the lease file and be included in all future Pretty Creek gas storage lease permit reviews. ADFG requested that Cook Inlet Areawide Lease Sale mitigation measures and lessee advisories be attached to the gas storage lease. ADFG also commented that it understood the purpose of the recently approved Special Area Permit (FG 05-II-0043) was for installation of a boost compressor necessary to deplete remaining reserves, not for purposes of injection, but noted that ADFG did not object to its usage for storage. Enstar Natural Gas Company commented that since no new facilities will be required, the project should be consistent with the ACMP. Enstar additionally commented that gas storage will play an increasingly important role in meeting gas supply requirements in the Cook Inlet region and will help meet peak demand needs for half the state's population. Enstar noted that having a facility at Pretty Creek (west side of Cook Inlet) is vital in the event of any disruption of storage at Swanson River Field (east side of Cook Inlet). Trading Bay Oil and Gas, LLC (TBOG) commented on both the ACMP consistency and the state's best interest determination for this proposed gas storage lease application. Comments relative to the ACMP determination stated that ifUnocal's proposed injection operations were to create an abnormally pressurized zone on TBOG's adjacent leases, it could result in unforeseen effects and would violate 11 AAC 112.230 regarding the siting of energy facilities. This regulation requires operators to cooperate with landowners and developers in the development of their facilities, and requires facilities to be located such that they are compatible with existing and subsequent adjacent uses. The Proposed Consistency Determination noted that a preliminary determination of discontinuity between the proposed storage zones and the TBOG production zones had been made; and further that the comment was not germane to ACMP consistency, which focuses on surface impacts. TBOG's comments relative to the best interest finding stated that if Unocal's proposed injection were to affect the operations on TBOG leases, TBOG may not drill to explore or develop its leases, which would be contrary to the interests of the state. As stated in this finding, the state does not anticipate any effect on neighboring leases from 5 ) ') proposed injection operations. Should new information show otherwise, subsequent plan of operations permits may be amended or conditioned appropriately. TBOG also commented on Unocal's application for a Storage Injection Order and requested a public hearing. At the hearing, held on August 10, 2005, TBOG expressed concern that injection operations could affect the natural pressure or fluid flow characteristics of the same sand horizon on its leases located approximately 2,600 feet north and 3,900 feet east of the storage lease boundary. TBOG also expressed concern that Unocal would someday claim that gas produced from its neighboring lease was Unocal's injected gas. The AOGCC said there is never any complete certainty that the injections will not affect TBOG leases, but that it was very unlikely, given that the sands mapped by Unocal do not extend onto TBOG leases, and that Beluga sands rarely extend that distance anywhere in Cook Inlet. The Division has independently determined that all available data indicates that the reservoir sands proposed for storage are wholly contained in the proposed lease area. The Division has seen no evidence, nor was any presented, that would suggest that the Pretty Creek gas reservoir is in communication with any potential gas reservoir located on TBOG leases. In addition, the terms of the proposed storage lease provide protections in the event of migrating gas and changes in pressure. Paragraph 1 provides that lessee's storage rights must be "exercised in a manner that will not unreasonably interfere with the rights of any permittee, lessee or grantee of the state consistent with the principle of reasonable concurrent uses as set out in Article VIII, Section 8 of the Alaska Constitution." Paragraph 12(b) requires the lessee to notify the division of any anticipated changes in a project resulting in alteration of conditions that were originally approved, including: increase in size of the project; increase in the approved zone pressure; changes in the injection and withdrawal intervals; changes in the observation and collection intervals; or monitoring procedures. No changes may be carried out without commissioner approval. Paragraph 21 of the lease states that if the Commissioner determines that stored gas is migrating from the gas storage formation to other formations or that stored gas within the gas storage formation is expanding beyond the limits of the leased area, this lease may be amended, effective as of the date prescribed by the Commissioner, to include formations or lands subject to the same terms and conditions applicable to the lands and formations previously committed to this lease. Alaska Coastal Management Program If the proposed activity (a disposal of interest in land) occurs in a coastal area, AS 46.40 requires that the activity be consistent with the ACMP, which includes approved local district coastal zone management plans. The Notice described above solicited comments relative to such a consistency determination. Under 11 AAC 110.255, the Department issued a Proposed ACMP Consistency Determinationfor Proposed Gas Storage Lease Application (ADL 390776), Pretty Creek 6 ) Unit on July 28, 2005 which addressed all relevant comments received in response to the Notice. Issued concurrently with this Best Interest Finding, the Final Consistency Determination finds this disposal to be consistent with the ACMP, including the MSB Coastal Resource District's Coastal Management Plan. Material Facts and Issues ADNR approved the Pretty Creek Unit (PCU) on October 10,1977. Chevron, U.S.A., Inc. discovered the Pretty Creek gas field in 1979 with the Pretty Creek Unit #2 well. The PCU #2 was completed and immediately suspended on February 26, 1979 due to a lack of market for the gas. Following this discovery, two additional wells have been drilled in the unit area. In an effort to delineate the northern extent of the producing reservoir, the PCU #224-28 was drilled and abandoned in August 1986. After Enstar Natural Gas Company built its 20-inch pipeline across the unit area, ADNR approved the Pretty Creek Unit Beluga Participating Area on August 19, 1986. The operator, Unocal, put the PCU #2 well into production on December 17, 1986. The PCU #2 well produced 6.4 billion cubic feet of gas until Unocal shut-in the well in January 1999, due to sand accumulation in the wellbore. The PCU #4 well was completed on November 30,2001 and began producing gas from the commingled Beluga-Sterling Formation at an initial rate of 4.7 million cubic feet of natural gas daily (MMCFD). Recently, the Sterling FOfl11ation sand horizon (45-0) began producing water into the well bore, and that horizon was sealed off from the deeper, producing Beluga sand with a sliding sleeve. PCU #4 is currently producing 1.3 MMCFD, and Unocal expects the well to cease being economic to produce before the end of 2005, after having produced almost 3 billion cubic feet of gas. Currently, the gas must be compressed before it will flow into the Enstar sales pipeline that serves the Matanuska-Susitna Valley and Greater Anchorage Area. Without this storage project, Unocal would shut-in the well when there are no economically recoverable gas reserves remaining in the Beluga 51-5 sand. The Sterling 45-0 sand produces significant quantities of water in association with gas in the PCU #4 well. The applicant proposes to conduct injection and withdrawal operations from an existing well, gravel pads, roads, and utilities infrastructure. Installation of additional compression and possibly an additional well are foreseeable to fully exploit the working gas capacity of the storage lease area. It is anticipated that all future activities will occur on existing pads and roads in the lease area. Further, any future plan of operations approvals will undergo public and multi-agency ACMP review, and all activities must comply with mitigation measures attached to the storage lease. No additional impact to the surrounding environment, including the habitat and the fish and wildlife species that depend on that habitat, is foreseeable following issuance of the gas storage lease. 7 ) ) All relevant statutes and regulations have been considered in this finding, including AS 38.05.180(u), 11 AAC 83.500-520, AS 41.06, and 20 AAC 25.252. All terms are specified in the lease. To prevent the storage lease from extending the term of oil and gas leases covering large tracts of land not used for storage, this decision requires that the oil and gas leases underlying the storage lease area be segregated, and new leases issued for the acreage outside the storage lease. The Division significantly amended the lease terms proposed by Unocal and added terms necessary to protect the interests of the state, such as Reserved Rights, Term, Renewal, Required Operations, Native Gas Royalty, Storage Operations Plan, Storage Development Plan, Diligence, Suspension, Surrender, Default and Termination, Rights upon Termination, and Local Hire. Environmentallmpacts The proposed gas storage lease is within the Susitna Flats State Game Refuge (SFSGR), established in 1976 under AS 16.20.036 to protect: (1) fish and wildlife habitat and populations, particularly waterfowl nesting, feeding, and migration areas; moose calving areas; spring and fall bear feeding areas; salmon spawning and rearing habitats; and (2) public uses of fish and wildlife and their habitat, particularly waterfowl, moose, and bear hunting; viewing; photography; and general public recreation in a high quality environment. The SFSGR is known for its public uses, such as wildlife viewing and hunting. Approximately ten percent of the statewide waterfowl harvest comes from the SFSGR. Producing gas fields within this refuge include Pretty Creek, Lewis River, Ivan River and Stump Lake. All approvals for activities are conditioned by mitigation measures designed to protect the recognized values of the SFSGR. ADNR, ADFG, the MSB and various additional stakeholders participated in developing the Cook Inlet Areawide mitigation measures which address operations within the original oil and gas lease sale area, including the SFSGR. Those mitigation measures, as modified to specifically address this gas storage lease, address potential environmental impacts, and are incorporated by reference into the proposed gas storage lease The storage lessee must comply with all applicable state and federal statutes and regulations, including the mitigation measures, and any terms imposed in the AOGCC Storage Injection Order. ADNR has the authority to amend the proposed storage lease if stored gas migrates from the gas storage formation to other formations, or if stored gas expands beyond the limits of the leased area. The storage lessee shall notify the Division 8 ) ) of any anticipated changes in the project resulting in alteration of conditions that were originally approved, and must obtain further approval before implementing those changes. Analysis of State Benefits Gas storage increases reliability of gas delivery to electric utility companies, industrial users, and all residents who use gas in the Cook Inlet Basin. Nearly sixty percent of Alaskans depend on Cook Inlet gas to heat or light their homes and businesses (ADOL WD, 2004). All electric utilities in the Cook Inlet region depend on reliable supplies of natural gas. Most homes located along the natural gas pipeline grid system are heated with natural gas or gas-generated electricity. The ConocoPhillips-Marathon Liquefied Natural Gas (LNG) Facility, Tesoro Petroleum Refinery, and Agrium fertilizer/ammonia plant rely on natural gas delivered from the Cook Inlet pipeline grid (USDOE,2004). There exists at times a shortage of gas for use in Cook Inlet along the gas pipeline distribution system during the winter months of peak demand. When demand exceeds supply, gas delivery contracts specify that industrial use be curtailed, requiring plant operators to shut down facilities and output. Of the 200 billion cubic feet of gas consumed in Cook Inlet in 2003, 20 percent was sold to Agrium for urea/ammonia production, 37 percent to ConocoPhillips-Marathon plant for LNG production, and the remainder was used for power generation (18 percent), utility gas (16.5 percent), field operations and other uses (8.3 percent). Industrial consumption is level, but residential and commercial demand is growing (ADNR, 2004). During the winter of 2004-2005, industrial use at Nikiski was curtailed at times because producers could not supply enough natural gas to all markets. Unlike previous years, in the future diverting supply from industrial users such as the Agrium fertilizer plant or the ConocoPhillips-Marathon LNG plant may not compensate for the forecasted shortfall. Sufficient gas storage will help alleviate peak demand shortages, thereby helping to provide a reliable supply to industrial, commercial and residential end users. On July 29, 2005, Alaska Governor Murkowski's Agrium Task Force recommended that state and federal government and industry actively support and promote the establishment of new natural gas storage facilities within the Cook Inlet Basin to address the issue of natural gas deliverability shortfalls in winter. "The natural gas system may be challenged to meet future peak demand periods in winter. Without adequate natural gas storage capacity in place, industrial users are the first to feel the effects of deliverability shortfalls through curtailment of their natural gas supplies in deference to the needs of utility consumers. Curtailments of supply create increasingly unfavorable economic conditions for industrial users that may ultimately result in the closure of one or more natural gas based industrial plants." Total Cook Inlet gas reserves are estimated at 2.087 trillion cubic feet; of which about 300 billion cubic feet are undeveloped. Reserves will eventually be produced, but 9 ,) daily demand for gas, especially on cold winter days, exceeds the supply that currently can be delivered (ADNR, 2004). While industrial demand is relatively stable throughout the year, residential and commercial demand for gas ranges from 35 MMCFD in the summer to 200 MMCFD or higher on the coldest days of the year. Enstar forecasts daily gas contract needs to grow 2% each year over the next 10 years. Demand for gas on an average annual basis will exceed contracted supply beginning in 2009 (Enstar, 2005). Some of the gas after 2009 will come from undeveloped reserves; however production rates from ageing fields and existing wells are declining and there are virtually no new large gas discoveries in Cook Inlet to replace existing production. Unocal's proposed gas storage facility at Pretty Creek may deliver a maximum of 20 MMCFD to the Cook Inlet gas pipeline grid or 700 MMCF annually. The Division estimates Cook Inlet will require an additional 9 to 14 billion cubic feet of annual storage capacity to meet peak winter spikes in demand (ADNR, 2005). Best Interest Determination State oil and gas leases exclude storage rights except for secondary or tertiary enhanced oil recovery or reservoir pressure maintenance. AS 38.05.180(u) allows ADNR to authorize underground storage of hydrocarbons as a separate activity from conventional oil and gas leasing. In Alaska, depleted reservoirs with established well control data are preferred storage zones. Some unproduced "native" gas remains in the gas storage reservoirs and serves as "cushion gas" to support gas withdrawal and delivery rates. Cushion gas is the volume of gas intended as permanent inventory in a storage reservoir to maintain adequate pressure and deliverability rates throughout the withdrawal season. Royalty on this native cushion gas will be paid from a percentage of each year's annual gas withdrawal as if it were originally produced from the overlying oil and gas lease, and allocated according the Pretty Creek Unit Agreement. Injected gas will mix with native gas in the reservoirs. Royalty on the native gas within the gas storage formation under the leased area will be computed at the royalty rate and paid at the value as specified in the applicable oil and gas leases. Paragraph 7 of the lease stipulates the methodology for determining monthly royalty payments for the native gas that will be allocated to the individual existing oil and gas leases as prescribed in the Pretty Creek Unit Agreement. The storage lease is for only specified sand horizons and does not give the lessee the right to drill, develop, produce, extract, remove or market gas other than injected gas. No other horizons in the PCU #4 well are known to contain commercial quantities of gas. The Pretty Creek commingled Sterling-Beluga gas pool is the only known accumulation in the leased area and is the basis for the Pretty Creek Unit, discovered in 1979. Unocal is the sole working interest owner of the storage lease and all overlying oil and gas leases. The storage lease allows the overlying oil and gas leases to continue as long as their original terms are met. The storage operator or lessee will be subject to terms and 10 ) J conditions identical to existing oil and gas lease permit and bonding requirements. Storage operations may not interfere with existing oil and gas lease operations. The underground storage of hydrocarbons is prohibited except as ordered by the AOGCC. On June 20, 2005, Unocal applied for a Storage Injection Order as required by 20 AAC 25.252. A public hearing was held on July 27 and continued on August 10. The operator must comply with 20 AAC 25, specifically 20 AAC 25.252. There are no wells within 1,500 feet of the injection well (PCU #4). Adjacent lease ownership lines are greater than 1,500 feet from the injection well, thus no spacing exception is required (20 AAC 25.055(a)(2». Before any gas may be injected, Unocal must obtain approval of the Injection Order from AOGCC. Well data and interpretations of seismic surveys indicate that the horizontal and vertical extent of the horizons proposed for injection are wholly contained within the storage lease area. Data and interpretations of those data reasonably demonstrate that injection operations will not affect the pressure or movement of fluid beneath adjacent leases. ADNR and U nocal agree that the estimated ultimate recovery of gas from the gas storage formation is 2.991 billion cubic feet. This estimate is based upon an engineering assessment which considers both mechanical constraints and well and reservoir performance, and utilizes decline curve, material balance, and nodal analysis techniques. Using the ultimate recovery value of 2.991 billion cubic feet, there rell1ained 33 MMCF of royalty-bearing recoverable reserves as of October 1, 2005. Developing the state's energy resources and ensuring reliability of supply is vital to the state economy and the well-being of its citizens. The state will be paid royalties on cushion gas that would not otherwise be produced. The gas storage project increases Unocal's ability to meet demand, results in operational efficiencies, and does not diminish royalty and tax payments that would occur without storage. Alaska's population is growing as is residential and commercial demand for natural gas. This growth will exacerbate gas deliverability shortages in the near future, unless gas storage or other deliverability measures are encouraged and implemented. Underground gas storage feasibility depends on favorable geological and engineering properties of the storage reservoir, its size and its cushion, or base, gas requirements. It also depends on access to transportation pipeline infrastructure, existing production infrastructure, gas production sources, and delivery points. Favorable geologic characteristics and location along an important gas pipeline make the Pretty Creek gas reservoir an ideal candidate for storing natural gas, conserving it for use during times of peak demand. All gas consumers in Cook Inlet, and especially industrial users, will benefit from efficiencies created by reliable gas service. Consumers or end users of natural gas in Cook Inlet may benefit from lower utility rates because of 11 ) J firm supply contracts between the producer (Unocal) and the gas delivery company (Enstar). The Pretty Creek natural gas storage facility is designed to help manage seasonal load variations, hourly swings, and emergency situations when consumer demand for gas exceeds available deliverability. The storage lease allows the operator to store gas during lower demand periods (usually summer) and withdraw and deliver that gas during the high demand periods of winter. This helps Unocal to meet contract demands year-round, furthering the goal of uninterrupted service for all consumers of gas in Cook Inlet. The proposed gas storage lease is conditioned by its terms, including mitigation measures and lessee advisories. It provides for a reasonable fee in exchange for exclusive use of the subsurface storage container, two nearly depleted gas reservoirs. The storage lease will have a ten year primary term with one optional renewal, and will continue in effect as long as the terms are met. The storage lessee must inject and withdraw gas on a regular basis to keep the lease. The state will be paid a fixed annual fee for use of the storage reservoirs. The Division tailored the fee to the stated purpose of the gas storage lease and finds this fee reasonable. The division based the fee on estimated working gas usage and considered the stated purpose of the gas storage facility, namely operational balancing and system supply, and not direct customer service. Should the purpose of the storage facility change the lessee must file an amended storage operations plan. Further, state interests are protected because any change in the material conditions under which this lease was originally approved, including any increase in the size of the project or increase in zone pressure, requires ADNR approval. On the basis of the facts and issues, comments received, applicable laws and regulations, and the documents reviewed during preparations of this finding, I conclude that issuing gas storage lease ADL 390776 will best serve the interests of the state of Alaska. This finding is a final administrative decision of the department. A person affected by this decision who provided timely written comment or public hearing testimony on this decision may request reconsideration, in accordance with 11 AAC 02. Any reconsideration request must be received by 5:00 p.m. (local time), October 3, 2005 and may be mailed or delivered to Tom Irwin, 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 . If reconsideration is not requested by that date or if the commissioner does not order reconsideration on his own motion, this decision goes into effect as a final order and decision on October 14, 2005. Failure of the commissioner to act on a request for reconsideration within 30 days after issuance of this decision is a denial of reconsideration and is a final administrative order and decision for purposes of an appeal to Superior Court. The decision may then be appealed to Superior Court within a further 30 days in accordance with the rules of the court, and to the extent permitted by applicable law. An eligible person must first request 12 ) ) reconsideration of 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 any regional information office of the Department of Natural Resources. ~,.<£? ~ Mark D. Myers Director Septem ber 13, 2005 I concur with the director that the issuance of Gas Storage Lease ADL 390776 is in the best interests of the state. Thomas E. Irwin Commissioner September 13, 2005 13 ) ) References ADOL WD (Alaska Department of Labor and Workforce Development) 2004 Alaska Population Estimates 2000-2004. Alaska Department of Labor & Workforce Development, Research & Analysis Section. ADNR (Alaska Department of Natural Resources) 2005 Unpublished estimate. Alaska Department of Natural Resources, Division of Oil &' Gas, Commercial Section, August. 2004 Annual Report. Alaska Department of Natural Resources, Division of Oil & Gas, December. Enstar Natural Gas Company 2005 Personal cOlll111unication with Dan Dickegraff, Enstar Natural Gas Company, August 18, 2005. USDOE (United States Department of Energy) 2004. South-Central Alaska Natural Gas Study. Charles P. Thomas, et al. United States Department of Energy, National Energy Technology Laboratory, Arctic Energy Office, Final Report, June. Attached: ADL 390776 Gas Storage Lease (including Mitigation Measures and Lessee Advisories 14 ) ) Gas Storage Lease Form #OOG 200509 STATE OF ALASKA DEPARTMENT OF NATURAL RESOURCES Gas Storage Lease ADL No. 390776 THIS LEASE is entered into , between the State of Alaska, "the state," and Union Oil Company of California, a California Corporation, "the lessee," whether one or more, whose sole address for purposes of notification is under Paragraph 27. In consideration of the payment made by the lessee to the state, and subject to the provisions of this lease, including the mitigation measures and lessee advisories attached to this lease and by this reference incorporated in this lease, the state and the lessee agree as follows: 1. GRANT. (a) Subject to the provisions in this lease, the state grants and leases to the lessee, without warranty, the exclusive right for Storage of Gas and Associated Substances in the Gas Storage Formation under the following described tract of land: T. 13 N., R. 9 W., Tract A, Seward Meridian, Alaska Section 3, Unsurveyed, W1/2NW1/4, 80.00 acres; Section 4, Unsurveyed, N1/2, N1/2SW1/4, SE1/4SW1/4, SE1/4, 600.00 acres; T. 14 N., R. 9 W., Tract A, Seward Meridian, Alaska Section 28, Unsurveyed, W1/2SW1/4, SE1/4SW1/4, SW1/4SE1/4, 160.00 acres; Section 32, Unsurveyed, E1/2E1/2, 160.00 acres; Section 33, Unsurveyed, W1/2NE1/4, SE1/4NE1/4, NW1/4, S1/2, 600.00 acres; Section 34, Unsurveyed, SW1/4SW1/4, 40.00 acres; containing approximately 1,640.00 acres, more or less (referred to in this lease as the "leased area"); and the nonexclusive right to install pipelines and build structures on the leased area for the purpose of Storage and to house and board employees in its operations on the leased area. The rights granted by this lease are to be exercised in a manner that will not unreasonably interfere with the rights of any permittee, lessee or grantee of the state consistent with the principle of reasonable concurrent uses as set out in Article VIII, Section 8 of the Alaska Constitution. (b) For the purposes of this lease, the leased area contains the legal subdivisions as shown on the attached plat marked Exhibit A. Page 1 of 17 ) , (c) If the leased area is described by protracted legal subdivisions and, after the effective date of this lease, the leased area is surveyed under the public land rectangular system, the boundaries of the leased area are those established by that survey, when approved, subject, however, to the provisions of applicable regulations relating to those surveys. (d) If the state's ownership interest in the leased area is less than an entire and undivided interest, the grant under this lease is effective only as to the state's interest and the payments provided in this lease must be paid to the state in the proportion that the state's interest bears to the entire undivided fee. (e) The state makes no representations or warranties, express or implied, as to title, or access to, or quiet enjoyment of, the leased area. The state is not liable to the lessee for any deficiency in title to the leased area, nor is the lessee or any successor in interest to the lessee entitled to any refund due to deficiency in title for any payments made under this lease. 2. GAS STORAGE FORMATION. Lessee proposes to use two gas sand horizons for the Storage of Gas, whether or not produced from state owned lands, which are defined in this lease as the "Gas Storage Formation" and are described as follows: Sterling 45-0 Gas Sands and Beluga 51-5 Gas Sands between the measured depth of 4,503 feet and 5,173 feet below the surface of the ground in the Pretty Creek Unit #4 well, the surface wellhead of which is located in Section 33, Township 14 North, Range 9 West, Seward Meridian, Alaska. 3. RESERVED RIGHTS. (a) The state, for itself and others, reserves all rights not expressly granted to the lessee by this lease. These reserved rights include: (1) the right to explore for Oil, Gas, and Associated Substances by geological and geophysical means; (2) the right to explore for, develop, and remove natural resources including Oil, Gas, and Associated Substances on or from the leased area; (3) the right to establish or grant easements and rights-of-way for any lawful purpose, including without limitation for shafts and tunnels necessary or appropriate for the working of the leased area or other lands for natural resources including Oil, Gas, and Associated Substances; (4) the right to dispose of land within the leased area for well sites and well bores of wells drilled from or through the leased area to explore for or produce Oil, Gas, and Associated Substances in and from lands not within the leased area; and (5) the right otherwise to manage and dispose of the surface of the leased area or interests in that land by grant, lease, permit, or otherwise to third parties. (b) The rights reserved may be exercised by the state, or by any other person or entity acting under authority of the state, in any manner that does not unreasonably interfere with or endanger the lessee's operations under this lease. 4. TERM. This lease is issued for an initial term of 10 years from the effective date of this lease. 5. RENEWAL. This lease is renewable for one additional, successive term of 10 years subject to any terms and conditions the Commissioner may impose, provided the lessee has complied fully with the terms of this lease. The annual fee for the renewal period will be the higher of (1) the annual fee set for the initial term increased by the PPI for Industrial Commodities, published by the Bureau of Labor Statistics, U.S Dept. of Labor, during the initial term of this lease, or (2) the highest annual fee for any other Cook Inlet Basin Gas Storage lease or agreement predominantly on state, federal, or a combination of state and federal land that is issued during the initial term of this lease. If the payment for such lease or agreement is other than an annual fee, that payment will be converted to an equivalent annual fee. 6. REQUIRED OPERATIONS. Lessee shall use the Gas Storage Formation for storage operations to maintain the lease. Any consecutive 24 month period without storage operations will constitute a default of the lease under paragraph 22, unless cessation of storage operations is undertaken pursuant to an approved suspension of operations under paragraph 17. For the purposes of this paragraph, storage operations mean the Injection or Withdrawal of Gas. 7 . NATIVE GAS ROYALTY. (a) The state and lessee agree that the estimated ultimate recovery of Native Gas from the Gas Storage Formation is 2,991 million cubic feet (MMcf) and that there are 33 MMcf of recoverable reserves (Native Gas) in the Gas Storage Formation under the leased area. Ten percent (10%) of all Gas withdrawn from the Gas Storage Formation is deemed to be royalty bearing Native Gas until a total of 330 MMCF of Gas has been withdrawn. Page 2 of 17 ,) ') (b) Lessee shall make additional royalty payments to the state for all Gas withdrawn from the Gas Storage Formation that exceeds the sum of the total Gas injected plus the 33 MMcf Native Gas. (c) Royalty on the Native Gas withdrawn from the Gas Storage Formation under the leased area will be paid under the terms of the applicable Oil and Gas leases and unit agreements. If Native Gas is withdrawn from state land with no applicable Oil and Gas lease, the lessee shall pay the state monthly royalty of the full market value of the Gas at the time it is withdrawn. (d) The lessee may inject only Produced Gas into the Gas Storage Formation. 8. FEE. The lessee shall pay an annual fee to the state of $25,000, plus $5,000 for each well in addition to the PCU #4 well used for Storage operations. (b) The lessee shall pay the annual fee to the state, in advance, on or before the annual anniversary date of this lease. The state may designate another depository with at least 60 days notice to the lessee. The state is not required to give notice that fees are due. If the state's (or depository's) office is not open for business on the annual anniversary date of this lease, the time for payment is extended to include the next day on which that office is open for business. 9. RECORDS. The lessee shall keep and have in its possession books and records showing the development and Storage operations (including records of development, Injection and Withdrawal expenses) and disposition (including records of sale prices, volumes, and purchasers) of all Gas and Associated Substances injected or withdrawn from the leased area. The lessee shall permit the state or its agents to examine these books and records at all reasonable times. Upon request by the state, the lessee's books and records must be made available to the state at the state office designated by the state. These books and records must employ methods and techniques that will ensure the most accurate figures reasonably available. The lessee shall use generally accepted accounting principles consistently applied. 10. PAYMENTS. All payments to the state under this lease must be made payable in the manner directed by the state, and unless otherwise specified, must be delivered to the state at: DEPARTMENT OF NATURAL RESOURCES 550 WEST 7TH AVENUE, SUITE 1410 ANCHORAGE, ALASKA 99501-3561 ATTENTION: FINANCIAL SERVICES SECTION or in person at either of the Department's Public Information Centers located at 550 W. ih Ave., Suite 1260 Anchorage, Alaska 3700 Airport Way Fairbanks, Alaska or to any depository designated by the state with at least 60 days notice to the lessee. 11. STORAGE OPERATIONS PLAN. 11 MC 83.158 will apply to all operations under this lease. Lessee shall have an approved operations plan prior to commencing Storage operations. 12. STORAGE DEVELOPMENT PLAN. (a) The lessee shall file annually two copies of an application for approval by the state of a development plan that must describe the lessee's plans under this lease. The plan must include the estimated size in surface acreage or shape, total capacity, and working capacity of the Gas Storage Formation and any other engineering, geological or operational data that may be requested by the Division. The development plan must include maps and statements describing: long-range activities for the leased area; plans for expansion or contraction of this lease; details of proposed operations for at least one year following submission of the plan; and the sequence and schedule of the operations (Injection and Withdrawal volumes) to be conducted on or in the leased area, including the date operations are proposed to begin and their proposed duration. Lessee shall have an approved development plan prior to commencing Storage operations. (b) The development plan must be revised, updated, and submitted to the state for approval 60 days before the anniversary date of the previously approved plan. If no changes from an approved plan are contemplated for the following year, the lessee shall file a statement to that effect for approval in lieu of the required revision and update. The Lessee shall notify the Division of any anticipated changes in a project resulting in alteration of conditions that were originally approved, including: increase in size of the project; increase in the approved zone pressure; changes in the Injection and Withdrawal intervals; changes in the observation and collection intervals; or monitoring procedures. No changes may be carried out without Commissioner approval. Page 3 of 17 ) (c) The lessee may, with the approval of the state, modify an approved development plan. 13. INFORMATION ACQUIRED FROM OPERATIONS. (a) The lessee shall submit to the state all geological, geophysical and engineering data and analyses obtained from the lease within 30 days following the completion of a well. The lessee shall submit to the state data and analyses acquired subsequent to well completion within 30 days following acquisition of that data. The state may waive receipt of operational data from some development, service or injection wells. The state will inform the operator of the waiver prior to well completion. The lessee shall submit the data and analyses to the Division at the location specified in paragraph 27 of this lease. The data and analyses must include the following: (1) a copy of the completion report (AOGCC form 10-407) with an attached well summary, including daily drilling reports, formation tops encountered, a full synopsis of drillstem and formation testing data, an identification of zones of abnormal pressure, Oil and Gas shows and cored intervals; (2) latitudinal and longitudinal coordinates for the completed surface and bottom hole locations; (3) a copy of the permit to drill (AOGCC form 10-401 only) and the survey plat of the well location; (4) a paper copy (no sepia copies) of all final 2-inch open hole and cased hole logs, including measured depth and true-vertical depth versions, specialty logs (such as Schlumberger's cyberlook, formation microscanners and dipmeter logs), composite mud or lithology log and report, measured-while-drilling (MWD) and logged-while-drilling (LWD) logs, velocity and directional surveys; (5) a digital version of well logs in LAS, LIS or ASCII format on IBM format floppy disks, a digital version of velocity surveys in SEG Y format, a digital version of directional surveys in ASCII format (other formats may be acceptable upon agreement with the Division); and (6) a paper copy of all available well analyses, including geochemical analyses, core analyses (porosity, permeability, capillary pressure, photos, and descriptions), paleontologic and palynologic analyses, thermal maturation analyses, pressure build up analyses, and fluid PVT analyses (an ASCII format digital version of the above information shall also be submitted, if available). The state may require the lessee to submit additional information in accordance with the applicable statutes and regulations in effect at the time of the completion date of the well. (b) Any information submitted to the state by the lessee in connection with this lease will be available at all times for use by the state and its agents. The state will keep information confidential under AS 38.05.035(a)(9) and its applicable regulations. In accordance with AS 38.05.035(a)(9)(C), in order for geological, geophysical and engineering information submitted under paragraph 13(a) of this lease to be held confidential, the lessee shall request confidentiality at the time the information is submitted. The information must be marked CONFIDENTIAL. 14. GAS MEASUREMENT. The lessee shall measure all Gas injected into and withdrawn from the Gas Storage Formation, and keep a record of all Injections and Withdrawals. Lessee shall submit to the Division within 30 days after each calendar month, a statement certified by lessee showing the total amount of Gas injected into and withdrawn from the Gas Storage Formation during that preceding calendar month, a copy of the Monthly Injection Report (AOGCC Form 10-406) and Facility Report of Produced Gas Disposition (AOGCC Form 10-422), and any other engineering, geological, or operational data that may be requested by the state. The amount of injected and withdrawn Gas reported each month must be computed at a standard pressure of 14.65 pounds per square inch absolute and a standard temperature of 60 degrees Fahrenheit, regardless of the pressure and temperature at which the Gas was actually measured. 15. DILIGENCE AND PREVENTION OF WASTE. (a) The lessee shall exercise reasonable diligence in Drilling wells and conducting Storage operations on the leased area unless consent to suspend operations temporarily is granted by the state. (b) The lessee shall perform all operations under this lease in a good and workmanlike manner in accordance with the methods and practices set out in the approved operations plan and development plan, with due regard for the prevention of waste of Oil, Gas, and Associated Substances and the entrance of water into the Oil and Gas-bearing sands or strata, and to the preservation and conservation of the property for future productive operations. The lessee shall carry out at the lessee's expense all orders and requirements of the state regarding the prevention of waste and the preservation of the leased area. If the lessee fails to carry out these orders, the state will have the right, together with any other available legal recourse, to enter the leased area to repair damage or prevent waste at the lessee's expense. (c) The lessee shall securely plug in an approved manner any well before abandoning it. 16. INSPECTION. The lessee shall keep open at all reasonable times, for inspection by any duly authorized representative of the state, the leased area, all wells, improvements, machinery, and fixtures on the leased area, and all reports and records relative to operations and surveys or investigations on or with regard to the leased area Page 4 of 17 ) or under this lease. Upon request, the lessee shall furnish the state with copies of and extracts from the reports and records. 17. SUSPENSION. The state may from time to time direct or approve in writing suspension of Storage operations under this lease in accordance with 11 AAC 82.670. Nothing in this paragraph suspends the obligation to pay fees, royalties or other production or profit-based payments to the state from operations on the leased area that are not affected by any suspension. 18. FORCE MAJEURE. If the state determines that the lessee has been prevented by Force Majeure, after efforts made in good faith, from performing operations under this lease, this lease will not expire during the period of Force Majeure. Nothing in this paragraph suspends the obligation to pay fees, royalties or other production or profit-based payments to the state from operations on the leased area that are not affected by any Force Majeure. 19. ASSIGNMENT. This lease, or an interest in this lease, may, with the approval of the state, be assigned, subleased, or otherwise transferred to any person or persons qualified to hold a lease in accordance with 11 AAC 82.605-11 AAC 82.630. 20. SURRENDER. The lessee at any time may file with the state a written surrender of rights under this lease in accordance with 11 AAC 82.635. 21. EXPANSION. If the Commissioner determines that Gas is migrating from the Gas Storage Formation to other formations or that Gas within the Gas Storage Formation is expanding beyond the limits of the leased area, this lease may be amended, effective as of the date prescribed by the Commissioner, to include additional formations or lands subject to the same terms and conditions applicable to the lands and formations previously committed to this lease. 22. DEFAULT AND TERMINATION; CANCELLATION. (a) The failure of the lessee to perform timely its obligations under this lease, or the failure of the lessee otherwise to abide by all express and implied provisions of this lease, is a default of the lessee's obligations under this lease. Whenever the lessee fails to comply with any of the provisions of this lease, and fails within 60 days after written notice of that default to begin and diligently prosecute operations to remedy that default, the state may terminate this lease if at the time of termination there is no Non-Native Gas within the Gas Storage Formation under the leased area. If there is Non-Native Gas within the Gas Storage Formation under the leased area, the lessee shall be given a reasonable period, not to exceed two years, in which to withdraw the Non-Native Gas from the Gas Storage Formation prior to termination. (b) The state may cancel this lease at any time if the state determines, after the lessee has been given notice and a reasonable opportunity to be heard, that: (1) continued operations under this lease will cause serious harm or damage to biological resources, to property, to mineral resources, or to the environment (including the human environment); (2) the threat of harm or damage will not disappear or decrease to an acceptable extent within a reasonable period of time; and (3) the advantages of cancellation outweigh the advantages of continuing this lease in effect. Any cancellation under this subparagraph will not occur unless and until operations under this lease have been under suspension or temporary prohibition by the state, with due extension of the term of this lease, continuously for a period of five years or for a lesser period upon request of the lessee. (c) Any cancellation under subparagraph (b) will entitle the lessee to receive compensation that the lessee demonstrates to the state is equal to the lesser of: (1) the value of the cancelled rights as of the date of cancellation, with due consideration being given to both anticipated revenues from this lease and anticipated costs, including costs of compliance with all applicable regulations and stipulations, liability for clean-up costs or damages, or both, in the case of an Oil spill, and all other costs reasonably anticipated under this lease; or (2) the excess, if any, over the lessee's revenues from this lease (plus interest on the excess from the date of receipt to date of reimbursement) of all consideration paid for this lease and all direct expenditures made by the lessee after the effective date of this lease and in connection with exploration or development, or both, under this lease, plus interest on that consideration and those expenditures from the date of payment to the date of reimbursement. 23. RIGHTS UPON TERMINATION. Upon the expiration or earlier termination or cancellation of this lease as to all or any portion of the leased area, the state shall direct the lessee in writing and the lessee shall have the right at any time within a period of one year after the expiration, termination or cancellation, or any extension of that Page 5 of 17 ) period as may be granted by the state, to remove from the leased area or portion of the leased area all machinery, equipment, tools, and materials. Upon the expiration of that period or extension of that period and at the option of the state, any machinery, equipment, tools, and materials that the lessee has not removed from the leased area or portion of the leased area become the property of the state and may be removed by the state at the lessee's expense. At the option of the state, all improvements such as roads, pads, and wells must either be abandoned and the sites rehabilitated by the lessee to the satisfaction of the state, or be left intact and the lessee absolved of all further responsibility as to their maintenance, repair, and eventual abandonment and rehabilitation. Subject to the above conditions, the lessee shall deliver up the leased area or those portions of the leased area in good condition. 24. DAMAGES AND INDEMNIFICATION. (a) No rights reserved under the AS 38.05.125 may be exercised by the lessee until the lessee has provided to pay the owner of the land, his lessees and permittees, upon which the AS 38.05.125 reserved rights are sought to be exercised, full payment for all damage sustained by the owner by reason of entering the land. If the owner for any reason does not settle the damages, the lessee may enter the land after posting a surety bond determined by the state, after notice and an opportunity to be heard, to be sufficient in form, amount, and security to secure to the owner, his lessees and permittees, payment for damages, and may institute legal proceedings in a court of competent jurisdiction where the land is located to determine the damages which the owner of the land may suffer. The lessee agrees to pay for any damages that may become payable under AS 38.05.130 and to indemnify the state and hold it harmless from and against any claims, demands, liabilities, and expenses arising from or in connection with such damages. The furnishing of a bond in compliance with this paragraph will be regarded by the state as sufficient provision for the payment of all damages that may become payable under AS 38.05.130 by virtue of this lease. (b) The lessee shall indemnify the state for, and hold it harmless from, any claim, including claims for loss or damage to property or injury to any person caused by or resulting from any act or omission committed under this lease by or on behalf of the lessee. The lessee is not responsible to the state under this subparagraph for any loss, damage, or injury caused by or resulting from the sole negligence of the state. (c) The lessee expressly waives any defense to an action for breach of a provision of this lease or for damages resulting from an Oil spill or other harm to the environment that is based on an act or omission committed by an independent contractor in the lessee's employ. The lessee expressly agrees to assume responsibility for all actions of its independent contractors. 25. BONDS. Lessee agrees to maintain bonds in accordance with 11 MC 83.505(4) and 11 AAC 83.160. 26. AUTHORIZED REPRESENTATIVES. The Director of the Division of Oil and Gas, Department of Natural Resources, State of Alaska, and the person executing this lease on behalf of the lessee will be authorized representatives for their respective principals for the purposes of administering this lease. The state or the lessee may change the designation of its authorized representative, or the address to which notices to that representative are to be sent, by a notice given in accordance with Paragraph 27 below. Where activities under a development plan are underway, the lessee shall also designate, by a notice under Paragraph 27 below, by name, job title, and address, an agent who will be present in the state during all lease activities. 27. NOTICES; PROTEST. (a) Any notices required or permitted under this lease must be by electronic media producing a permanent record or in writing and must be given personally or by registered or certified mail, return receipt requested, addressed as follows: TO THE STATE: DIRECTOR, DIVISION OF OIL AND GAS DEPARTMENT OF NATURAL RESOURCES 550 WEST 7TH AVENUE, SUITE 800 ANCHORAGE, ALASKA 99501-3560 TO THE LESSEE: UNION OIL COMPANY OF CALIFORNIA 909 WEST NINTH AVENUE ANCHORAGE, ALASKA 99501 ATTENTION: LAND MANAGER (b) Any notice given under this paragraph will be effective when delivered to the above authorized representative. Page 6 of 17 ) (c) A lessee who wishes to protest the amount of money due the state under this lease or any action of the state regarding a provision of this lease must file a written protest with the Division within 30 days after the mailing date of the state's notice or bill. A lessee who fails to file a protest within the required time waives any further right to protest. The state will establish the administrative appeal procedure to be followed and will inform the lessee of the procedure no later than 30 days after the filing of the written protest. 28. STATUTES AND REGULATIONS. This lease is subject to all applicable state and federal statutes and regulations in effect on the effective date of this lease, and to all statutes and regulations placed in effect after the effective date of this lease. A reference to a statute or regulation in this lease includes any change in that statute or regulation whether by amendment, repeal and replacement, or other means. This lease does not limit the power of the state or the United States of America to enact and enforce legislation or to promulgate and enforce regulations affecting, directly or indirectly, the activities of the lessee or its agents in connection with this lease or the value of the interest held under this lease. In case of conflicting provisions, statutes and regulations take precedence over this lease. 29. INTERPRETATION. (a) This lease is to be interpreted in accordance with the rules applicable to the interpretation of contracts made in the State of Alaska. The paragraph headings are not part of this lease and are inserted only for convenience. The state and the lessee expressly agree that the law of the State of Alaska will apply in any judicial proceeding affecting this lease. (b) The term "including" when used in this lease will be by way of example only and shall not be considered in any way to be in limitation. (c) Any reference to a dollar amount contained in this lease will refer to United States dollars. (d) Unless the context requires otherwise, any reference in this lease to any document or instrument is a reference to that document or instrument and all schedules, exhibits, and attachments as amended and in effect from time to time. (e) Unless otherwise stated, any reference in this lease to any person, entity, or organization includes its permitted successors and assigns and, in the case of any governmental authority, any person succeeding to its functions and capacities. (f) Unless the context requires otherwise, the present tense will be read to include the past tense and the past tense will be read to include the present tense, and the singular will be read to include the plural and the plural will be read to include the singular. (g) This lease is the product of negotiation and collaboration between the state and lessee and interpretation of the terms of this lease shall favor neither party. 30. INTEREST IN REAL PROPERTY. It is the intention of the state and lessee that the rights granted to the lessee by this lease constitute an interest in real property in the leased area. 31. WAIVER OF CONDITIONS. The state reserves the right to waive any breach of a provision of this lease, but any waiver extends only to the particular breach waived and does not limit the rights of the state with respect to any future breach; nor will the waiver of a particular breach prevent cancellation of this lease for any other cause or for the same cause occurring at another time. Notwithstanding the foregoing, the state will not be deemed to have waived a provision of this lease unless it does so in writing. 32. SEVERABILITY. If it is finally determined in any judicial proceeding that any provision of this lease is invalid, the state and the lessee may jointly agree by a written amendment to this lease that, in consideration of the provisions in that written amendment, the invalid portion will be treated as severed from this lease and that the remainder of this lease, as amended, will remain in effect. 33. LOCAL HIRE. The lessee is encouraged to hire and employ local and Alaska residents and companies, to the extent they are available and qualified, for work performed on the leased area. Lessees shall submit, with the operations plan, a proposal describing the means by which the lessee will comply with this measure. The lessee is encouraged, in formulating this proposal, to coordinate with employment services offered by the state and local communities and to recruit employees from local communities. Page 7 of 17 ) 34. NONDISCRIMINATION. The lessee and the lessee's contractors and subcontractors may not discriminate against any employee or applicant because of race, religion, marital status, change in marital status, pregnancy, parenthood, physical handicap, color, sex, age, or national origin as set out in AS 18.80.220. The lessee and its contractors and subcontractors must, on beginning any operations under this lease, post in a conspicuous place notices setting out this nondiscrimination provision. 35. DEFINITIONS. All words and phrases used in this lease will be interpreted in accordance with AS 01.10.040. However, the following words have the following meanings unless the context unavoidably requires otherwise: (1) "Associated Substances" means all substances except helium produced as an incident of production of Oil or Gas by ordinary production methods and not defined in this lease as Oil or Gas; (2) "Commissioner" means the Commissioner of Natural Resources; (3) "Division" means Division of Oil and Gas, Department of Natural Resources; (4) "Drilling" means the act of boring a hole to reach a proposed bottom hole location through which Gas may be injected or withdrawn, and includes redrilling, sidetracking, deepening, or other means necessary to reach the proposed bottom hole location, testing, logging, plugging, and other operations necessary and incidental to the actual boring of the hole; (5) "Force Majeure" means war, riots, acts of God, unusually severe weather, or any other cause beyond the lessee's reasonable ability to foresee or control and includes operational failure of existing transportation facilities and delays caused by judicial decisions or lack of them;. (6) "Gas" means all natural Gas (except helium gas) and all other hydrocarbons that are not defined in this lease as Oil; (7) "Gas Storage Formation" means the reservoirs described in paragraph 2; (8) "Injection" means the deposit of Non-Native Gas into the Gas Storage Formation; (9) "Native Gas" means Gas within the Gas Storage Formation that has not been produced and for which production royalties have not been paid; (10) "Non-Native Gas" means Gas injected into the leased area that has been previously produced and for which production royalties have been paid. (11) "Oil" means crude petroleum Oil and other hydrocarbons, regardless of gravity, that are produced in liquid form by ordinary production methods, including liquid hydrocarbons known as distillate or condensate recovered by separation from Gas other than at a Gas processing plant; (12) "Produced Gas" means Gas for which royalty has been paid to the mineral owner; (13) "Storage" means the compression, Injection, containment, Withdrawal, treatment, processing, transportation, marketing and selling of Non-Native Gas; (14) "Withdrawal" means the removal of Non-Native Gas from the Gas Storage Formation; Page 8 of 17 ) 36. EFFECTIVE DATE. This lease takes effect on BY SIGNING THIS LEASE, the state as lessor and the lessee agree to be bound by its provisions. STATE OF ALASKA By: Mark D. Myers Director, Division of Oil and Gas STATE OF ALASKA ) ) ss. Third Judicial District ) On , before me appeared Mark D. Myers of the Division of Oil and Gas of the State of Alaska, Department of Natural Resources, and who executed this lease and acknowledged voluntarily signing it on behalf of the State of Alaska as lessor. Notary public in and for the State of Alaska My commission expires September 28, 2007 UNION OIL COMPANY OF CALIFORNIA By: Kevin A. Tabler Attorney in Fact STATE OF ALASKA ) ) ss. Third Judicial District ) On , before me appeared Kevin A. Tabler, Attorney in Fact for Union Oil Company of California, and who executed this lease and acknowledged voluntarily signing it on behalf of Union Oil Company of California as lessee. Notary public in and for the State of Alaska My commission expires February 14,2006 Page 9 of 17 ) Mitigation Measures The proposed gas storage lease is entirely within the Susitna Flats State Game Refuge (SGR). Management of the Susitna Flats SGR is the co-responsibility of ADNR (AS 38.05.027) and ADF&G (AS 16.20.050-060). For activities occurring within the refuge, the lessee will be required to obtain permits from both ADNR and ADF&G. The decision whether to grant an exception to these mitigation measures will be based on review of the Plan of Operations by the public and in consultation with appropriate state resource agencies. Mitigation measures subject to exceptions are noted with an asterisk (*), followed by the initials of the agency that must be consulted in any decision to grant an exception. Agency abbreviations are: ADF&G (Alaska Department of Fish and Game), ADEC (Alaska Department of Environmental Conservation), OHMP (ADNR/Office of Habitat & Management Permitting) and DMLW (ADNR/Division of Mining, Land & Water). Operations within this refuge must comply with the terms and conditions of the lease and the regulations at 5 AAC 95. Where the requirements of this lease are more restrictive than the requirements of other sources, the provisions of this lease prevail. General 1. Use of explosives will be prohibited in open water areas of fish bearing streams and lakes. Explosives must not be detonated beneath, or in close proximity to fish bearing streams and lakes if the detonation of the explosive produces a pressure rise in the waterbody greater than 2.5 pounds per square inch (psi) unless the waterbody, including its substrate, is solidly frozen. Explosives must not produce a peak particle velocity greater than 0.5 inches per second (ips) in a spawning bed during the early stages of egg incubation. The minimum acceptable offset from fish bearing streams and lakes for various size buried charges is: Charge Weight 1 pound charge 2 pound charge 5 pound charge 10 pound charge 25 pound charge 100 pound charge Distance from Stream 37 feet (11.2 m) 52 feet (15.8 m) 82 feet (25.0 m) 116 feet (35.4 m) 184 feet (50.1 m) 368 feet (112.2 m) Specific information on the location of these fish bearing waterbodies may be obtained by contacting ADF&G. Page 10 of 17 ) ) 2.* Onshore exploration activities must be supported by air service, an existing road system or port facility, ice roads, or by vehicles which do not cause significant damage to the ground surface or vegetation. Unrestricted surface travel may be permitted by the directors of DO&G, DMLW, and by ADF&G if an emergency condition exists. Construction of temporary roads may be allowed. Temporary means that a road must be removed to the extent that it is rendered impassable or is otherwise rehabilitated in a manner such that any placed gravel remaining approximates surrounding natural features. Construction of permanent roads will be prohibited during the exploration phase. *Exception - DMLW, ADF&G 3. a. Removal of water from fish bearing rivers, streams, and natural lakes shall be subject to prior written approval by DMLW, OHMP. b. Compaction or removal of snow cover overlying fish bearing waterbodies will be prohibited except for approved crossings. If ice thickness is not sufficient to facilitate a crossing, ice and/or snow bridges may be required. 4. Water intake pipes used to remove water from fish bearing waterbodies must be surrounded by a screened enclosure to prevent fish entrainment and impingement. Screen mesh size shall not exceed 0.04 inches unless another size has been approved by OHMP and ADF&G. The maximum water velocity at the surface of the screen enclosure may be no greater than 0.1 foot per second. Facilities and Structures 5. a. The siting of onshore facilities, other than docks, or road and pipeline crossings, will be prohibited within 500 feet of all fish bearing streams and lakes. Additionally, siting of facilities will be prohibited within one-half mile of the banks of the Theodore and Beluga rivers. New facilities may be sited within the one-half mile buffer if the lessee demonstrates that the alternate location is environmentally preferable, but in no instance will a facility be located within one-quarter mile of the river bank. ADF&G concurrence will be required for siting within the one-half mile buffer. Road and pipeline crossings must be aligned perpendicular or near perpendicular to watercourses. b. Lessees will minimize sight and sound impacts for new facilities sited less than one-half mile from river banks and in areas of high recreational use by (1) providing natural buffers and screening to conceal facilities; (2) conducting exploration operations between October 1 and April 30; and (3) using alternative techniques to minimize impacts. 6. The siting of new facilities in key wetlands and sensitive habitat areas should be limited to the extent possible. If facilities are to be located within these areas, the lessee should demonstrate to the satisfaction of the Director and ADF&G thatimpacts are minimized through appropriate mitigation measures. 7.* Measures will be required by the Director or ADF&G, after consultation with ADEC, to minimize the impact of industrial development on key wetlands. Key wetlands are those wetlands that are important to fish, waterfowl, and shorebirds because of their high value or scarcity in the region or that have been determined to function at a high level using the Page 11 of 17 " ) hydrogeomorphic approach. Lessees must identify on a map or aerial photograph the largest surface area, including reasonably foreseeable future expansion areas, within which a facility is to be sited, or an activity will occur. The map or photograph must accompany the plan of operations. DO&G will consult with ADF&G and ADEC to identify the least sensitive areas within the area of interest. To minimize impacts, the lessee must avoid siting facilities in the identified sensitive habitat areas. *Exception - ADEC. 8.* Impermeable lining and diking, or equivalent measures such as double-walled tanks, will be required for onshore oil storage facilities and for sewage ponds. Additional site-specific measures may be required as determined by ADNR, with the concurrence of ADEC, and will be addressed in the existing review of project permits or oil spill contingency plans (C- Plans). Buffer zones of not less than 500 feet will be required to separate onshore oil storage facilities and sewage ponds from marine waters and freshwater supplies, streams, lakes, and key wetlands. Sumps and reserve pits must be impermeable and otherwise fully contained through diking or other means. *Exception - ADEC, ADF&G. 9.* With the exception of drill pads, airstrips, and roads permitted under Measure 2, exploration facilities must be consolidated, temporary, and must not be constructed of gravel. Use of abandoned gravel structures may be permitted on an individual basis. *Exception - DMLW, ADF&G. 10. a. Wherever possible, onshore pipelines must utilize existing transportation corridors and be buried where soil and geophysical conditions permit. In areas where pipelines must be placed above ground, pipelines must be sited, designed and constructed to allow free movement of moose and caribou. b. Pipelines must be located upslope of roadways and construction pads and must be designed to facilitate the containment and cleanup of spilled hydrocarbons. Pipelines, flowlines, and gathering lines must be designed and constructed to assure integrity against climatic conditions, tides and currents, and other geophysical hazards. Local Hire 11. To the extent they are available and qualified, the lessee is encouraged to employ local and Alaska residents and contractors for work performed on the leased area. Lessees shall submit, as part of the plan of operations, a proposal detailing the means by which the lessee will comply with the measure. The proposal must include a description of the operator's plans for partnering with local communities to recruit and hire local and Alaska residents and contractors. The lessee is encouraged, in formulating this proposal, to coordinate with employment services offered by the state of Alaska and local communities and to recruit employees from local communities. Training 12. Lessee must include in any plan of exploration or plan of development, a training program for all personnel, including contractors and subcontractors, involved in any activity. The program must be designed to inform each person working on the project of environmental, social, and cultural concerns which relate to the individual's job. The program must employ Page 12 of 17 ) effective methods to ensure that personnel understand and use techniques necessary to preserve geological, archeological, and biological resources. In addition, the program must be designed to help personnel increase their sensitivity and understanding of community values, customs, and lifestyles in areas where they will be operating. Access 13. a. Public access to, or use of, the leased area may not be restricted except within the immediate vicinity of onshore drill sites, buildings, and other related structures. Areas of restricted access must be identified in the plan of operations. b. No lease facilities or operations may be located so as to block access to or along navigable and public waters as defined at AS 38.05.965(13) and (17). 14. Lease-related use will be restricted when the commissioner determines it is necessary to prevent unreasonable conflicts with local subsistence harvests and commercial fishing operations. In enforcing this term the division, during review of plans of operation or development, will work with other agencies and the public to assure that potential conflicts are identified and avoided. In order to avoid conflicts with fishing activities, restrictions may include alternative site selection, requiring directional drilling, seasonal drilling restrictions, and other technologies deemed appropriate by the commissioner. Prehistoric, Historic, and Archeological Sites 15. a. Prior to the construction or placement of any structure, road, or facility resulting from exploration, development, or production activities, the lessee must conduct an inventory of prehistoric, historic, and archeological sites within the area affected by an activity. The inventory must include consideration of literature provided by the Matanuska- Susitna Borough (MSB) and local residents; documentation of oral history regarding prehistoric and historic uses of such sites; evidence of consultation with the Alaska Heritage Resources Survey and the National Register of Historic Places; and site surveys. The inventory must also include a detailed analysis of the effects that might result from the activity. b. The inventory must be submitted to the Director for distribution to Division of Parks and Outdoor Recreation (DPOR) for review and comment. In the event that a prehistoric, historic, or archeological site or area may be adversely affected by a leasehold activity, the Director, after consultation with DPOR and the MSB, will direct the lessee as to what course of action will be necessary to avoid or minimize the adverse effect. c. Discovery of prehistoric, historic, or archaeological objects: In the event any site, structure, or object of prehistoric, historic, or archaeological significance is discovered during leasehold operations, the lessee must immediately report such findings to the Director. The lessee must make every reasonable effort to preserve and protect such site, structure, or object from damage until the Director, after consultation with the SHPO, has given directions as to its preservation. Page 13 of 17 ) Fish bearing Streams 16. Under Title 41 of the Alaska Statutes, the measures listed below may be imposed by OHMP to protect designated anadromous fish-bearing streams. Similar provisions will be imposed by the Director to protect non-anadromous fish bearing streams. Specific information on the location of anadromous waterbodies in and near the area may be obtained from OHMP. a. Alteration of river banks will be prohibited. b. Operation of equipment within riparian habitats will be prohibited. c. The operation of equipment, excluding boats, in open water areas of rivers and streams will be prohibited. d. Bridges or non-bottom founded structures will be required for crossing fish spawning and important rearing habitats. In areas where culverts are used, they must be designed, installed, and maintained to provide for the efficient passage of fish. Waste Disposal 17. Solid waste disposal: a. Solid waste generated from the development and/or operation of the lease areas shall be reduced, reused, or recycled to the maximum extent practicable. Garbage and domestic combustible refuse remaining following reuse or recycling must be incinerated where appropriate. Remaining solid waste shall be taken to an approved disposal site, in accordance with 18 AAC 60. New solid waste disposal sites will not be approved or located on state property during the exploratory phase. Exceptions may be provided for drilling waste if the facility will comply with the applicable provisions of 18 AAC 60. b. The preferred method for disposal of muds and cuttings from oil and gas activities is by underground injection. AOGCC regulates both the Underground Injection Control (UIC) program and annular disposal of wastes. c. Discharge of drilling muds and cuttings into lakes, streams, rivers, and high value wetlands is prohibited. Surface discharge of drilling muds and cuttings into reserve pits shall be allowed only when it is determined that annular injection is not technically achievable. A solid waste disposal permit must be obtained from ADEC. If use of a reserve pit is proposed, the operator must demonstrate the advantages of a reserve pit over other disposal methods, and describe methods to be employed to reduce the disposed volume. On pad temporary cuttings storage will be allowed as necessary to facilitate annular injection and/or backhaul operations in accordance with ADEC solid waste regulations 18 AAC 60. Page 14 of 17 ) 18. Wastewater disposal: a. Unless authorized by NPDES and/or state permit, disposal of wastewater into freshwater bodies, intertidal areas, or estuarine waters is prohibited. b. Disposal of produced waters to freshwater bodies, intertidal areas, and estuarine waters is prohibited. c. Disposal of produced waters in upland areas, including wetlands, will be by subsurface disposal techniques. d. Surface discharge of reserve pit fluids will be prohibited unless authorized in a permit issued by ADEC and approved by DMLW. Gravel Mining 19. Gravel mining within an active floodplain will be prohibited. Upland sites will be restricted to the minimum necessary to develop the field in an efficient manner. Special Areas 20. Since the lease area is wholly located within the Susitna Flats SGR, a legislatively designated Special Area, the following measures apply: a. Surface entry for drilling and above ground lease-related facilities and structures will be prohibited within the primary shorebird area in Susitna Flats SGR. Surface entry may be allowed on uplands within the SGR. Directional drilling from adjacent sites may be allowed. b. Exploration, development, and major maintenance within important Tule goose and trumpeter swan habitat in the Susitna Flats SGR and within the primary waterfowl area above mean high tide within the Susitna Flats SGR will be allowed only between November 1 and March 31, unless an extension is approved by ADF&G and DO&G. Routine maintenance and emergency repairs will be permitted on a year-round basis during the production phase. A detailed plan describing routine maintenance activities to be conducted between April 1 and October 31 must be submitted to ADF&G and DO&G for review and approval. c. Gravel pads and wellheads are the only above ground structures that will be allowed within the primary waterfowl area above mean high tide and in important Tule goose and trumpeter swan habitat in the Susitna Flats SGR. d. Construction activities within a refuge must utilize the best available technology to minimize the visual, biological, and physical impacts of these structures and must be approved in writing by ADF&G and the Director. e. Surface discharge of produced waters will be prohibited. f. Disposal of drilling muds and cuttings will be allowed only at upland sites approved by the Director and ADF&G, after consultation with DMLW and ADEC. Page 15 of 17 ) g. Facilities must be designed and constructed to prevent the spill and spread of hydrocarbons and to facilitate cleanup efforts. h. Facilities must be designed to minimize the possibility of spills or fires resulting from vandalism or hunting accidents. i. Upon abandonment or expiration of a lease, all facilities must be removed and the sites rehabilitated to the satisfaction of ADF&G and the Director. The departments may determine that it is in the best interest of the public to retain some or all of the facilities. Rehabilitation requirements will be identified in a Special Area Permit (AS 16.20.060). j. Gravel roads will not be allowed during exploration unless an exception is granted as provided above. 21.* Surface entry will be prohibited within one-quarter mile of trumpeter swan nesting sites between April 1 through August 31. The siting of permanent facilities, including roads, material sites, storage areas, powerlines, and above-ground pipelines will be prohibited within one-quarter mile of known nesting sites. Trumpeter swan nesting sites will be identified by ADF&G at the request of the lessee. *Exception - ADF&G. 22. Lessees must disclose any requests for exceptions to these mitigation measures and advisories in their plans of operation and applicable permit applications. 23. Plans of operation submitted for review and approval must describe the lessee's efforts to communicate with local communities, and interested local community groups, if any, in the development of such plans. 24. Lessees must submit a plan of operations to the state for approval as required by 11 AAC 83.158. Where surface activities are proposed on non state-owned land, lessees must submit a copy of the plan of operations to the private surface owner. Plans of operation must describe the lessee's efforts to minimize impacts on residential areas and privately- owned surface lands. Lessee Advisories 1. a. Aircraft flying over the primary shorebird habitat within the Susitna Flats SGR should maintain a minimum altitude of 1,500 feet above ground level or a horizontal distance of one mile. b. Aircraft flying over the primary waterfowl habitat above mean hiqh tide within the Susitna Flats SGR should maintain a minimum altitude of 1,500 feet above ground level or a horizontal distance of one mile from April 1 to October 31. Human safety will take precedence over this provision. 2. a. Because of the state's interest in encouraging clean air, lessees are encouraged to adopt conservation measures to reduce hydrocarbon emissions. Page 16 of 17 ) ) b. The state recognizes that in the long run sources of energy other than oil and gas will be needed. Lessee participation in conducting research on alternative energy sources is appreciated. 3. In populated areas where there is no local planning and zoning, ADNR may require, in approval of plans of operation, that permanent structures be designed to be compatible with the aesthetics of the surrounding area. 4. Bald eagles are protected under the Bald Eagle Protection Act (16 U.S.C. 668-668c) and the Migratory Bird Treaty Act of 1918 (16 U.S.C. 703-712) and are under authority of the U.S. Fish and Wildlife Service (USFWS). Lessees are responsible to ensure their actions do not take bald eagles. The Eagle Protection Act defines "take" to include disturbing birds. Any nests located within %-mile of the project site must be mapped, and destruction of nest trees or locations is prohibited. If any nests are located within %-mile of a project site, Lessees shall meet with the USFWS to review any site-specific concerns regarding the subject nest. USFWS generally recommends no clearing of vegetation within 330 feet of any nest. No activity should occur within 660 feet of any nests between March 1 and June 1. Between June 1 and August 31, no activity should occur within 660 feet of active eagle nests until after juvenile birds have fledged, unless specifically authorized by the USFWS. While the USFWS can recommend ways to avoid the take of eagles, final accountability lies with the party responsible for the action. 5. For projects in proximity to areas frequented by bears, lessees are encouraged to prepare and implement bear interaction plans to minimize conflicts between bears and humans. These plans could include measures to: (a) minimize attraction of bears to drill sites; (b) organize layout of buildings and work areas to minimize human/bear interactions; (c) warn personnel of bears near or on work sites and the proper procedures to take; (d) if authorized, deter bears from the work site; (e) provide contingencies in the event bears do not leave the site; (f) discuss proper storage and disposal of materials that may be toxic to bears; and (g) provide a systematic record of bears on site and in the immediate area. Page 17 of 17 ) Exhibit A ADL 390776 '1 tJ [I ~ 32 3~; 34:,:~",,,,, li::itiii:¡M;>:~,~', 4 "'1~"3 ,:;I 1.:11:11"11 1.. ;~:' /'1 T. 13 N., R. 9 W., Tract A, Seward Meridian, Alaska Section 3, Unsurveyed, W1/2NW1/4, 80.00 acres; Section 4, Unsurveyed, N1/2, N1/2SW1/4, SE1/4SW1/4, SE1/4, 600.00 acres; T. 14 N., R. 9 W., Tract A, Seward Meridian, Alaska Section 28, Unsurveyed, W1/2SW1/4, SE1/4SW1/4, SW1/4SE1/4, 160.00 acres; Section 32, Unsurveyed, E1/2E1/2, 160.00 acres; Section 33, Unsurveyed, W1/2NE1/4, SE1/4NE1/4, NW1/4, S1/2, 600.00 acres; Section 34, Unsurveyed, SW1/4SW1/4, 40.00 acres; This tract contains 1,640.00 acres, more or less. #24 ) '} UNOCAL8 Marc D. Bond Assistant Counsel Law Department Tel 907.263.7813 Fax 907.263.7607 Cell 907.229.5750 mbond@unocal.com VIA HAND DELIVERY August17,2005 RECE"/ED AUG 1 7 2005 John Norman, Chair Alaska Oil and Gas Conservation Commission 333 W. 7th Ave., Suite 100 Anchorage, Alaska 99501 Alaska Oil & Gas Cons. Commission Anchorage Re: In the Matter of the Application of Union Oil Company of California (Unocal) for a Stor- age Injection Order, Pretty Creek Gas Storage Facility Dear Chair Norman: During the hearing on August 10, 2005, and in response to concerns expressed by Trading Bay Oil & Gas LLC representatives concerning the possible effect of the proposed storage on its acreage to the north of Pretty Creek, Unocal projected a map of the Pretty Creek Unit (the "Map"). The Map was later filed with the Commission. Unfortunately, we may have left the Commission with the misimpression that Unocal's current interpretation is that the areal extent of the proposed storage reservoirs is coincident with the two colored areas on the Map. As we do not want to leave the Commission with that possible misimpression, we submit the enclosed affidavit of Coleen Shannon and attached exhibits. The exhibits attached to Ms. Shannon's affidavit include two drawings, sealed in a separate en- velope, which contain confidential information. These are Exhibits D and E, which have been marked in red as "UNOCAL CONFIDENTIAL" at the top and "CONFIDENTIAL" at the bottom. The confidential and proprietary nature of the information shown on Exhibits D and E is the con- tours of the sands shown in the exhibits. These are interpretations based upon well logs, seis- mic data and other confidential information held by Unocal. Both the interpretations and the data upon which they are based provide Unocal with independent actual economic value by not being known or readily ascertainable by other persons. As with all oil and gas companies, Uno- cal takes reasonable and significant efforts to maintain the secrecy of this information. Accord- ingly, this information is within the definition of "trade secret" in AS 45.50.940(3). Union Oil Company of California I Unocal Alaska 909 West 9th Avenue, Anchorage, Alaska 99501 http://www.unocal.com ) ') John Norman, Chair August 17, 2005 Page 2 Since Unocal is submitting Exhibits D and E voluntarily, the request for confidentiality may be proper under 20 AAC 25.537(b). However, since the materials are submitted in connection with a hearing held on Unocal's application for a storage injection order, our request for confidential- ity may be more appropriately handled under 20 AAC 25.540(c)(10). Unocal respectfully re- quests that the Commission maintain Exhibits D and E as confidential and not available to the other parties attending the hearing or to the public generally. ~:~ Marc Bond Union Oil Company of California I Unocal Alaska 909 West 9th Avenue, Anchorage. Alaska 99501 http://www.unocal.com ~. ) , ALASKA OIL AND GAS CONSERVATION COMMISSION Before Commissioners: John K. Norman, Chairman Daniel T. Seamount Cathy Foerster In the Matter of the Application of UNOCAL for a Storage Injection Order, Pretty Creek Gas Storage Facility AFFIDAVIT OF COLEEN C. SHANNON RECEIVE C) AUG I 7 Z005 STATE OF ALASKA ) ) ss. ) Alas~~ Oil & Gas Cons, CQmmi$siQo Anchorage THIRD JUDICIAL DISTRICT Coleen C. Shannon declares the following to be true under penalty of perjury: 1. I am a geologist engaged by Union Oil Company of California (Unocal) in the position of Advising Geologist in the Unocal Alaska business unit. I provided testimony before the Com- mission on this matter on Wednesday, August 10, 2005, including testimony respecting my ex- pertise in the area of petroleum geology. I have a bachelor of science degree in geology from Mount Holyoke College and a master of science degree in geology from Stanford University. 2. During the hearing on August 10, 2005, and in response to concerns expressed by Trading Bay Oil & Gas LLC representatives concerning the possible effect of the proposed stor- age on its acreage to the north of Pretty Creek, Unocal projected a map of the Pretty Creek Unit (the "Map"). The Map was later filed with the Commission and is attached to this affidavit as Ex- hibit A. At the hearing, I described the Map (which depicts two colored areas) as follows: What this shows is what we believe to be the extent of the 45 0 and 51 5 sands in the vicinity of the wells in the Pretty Creek Unit. The orange color would be the 51 5 and the magenta color would be the 45 0 sands. And those are the extents. Now this not specifically a structure map, but it gives you a sense for what we do believe the extent is of these sands. 3. In response to questioning by Commissioner Foerster, I furthered described the method for developing the Map as follows: Pretty Creek Gas Storage Facility Affidavit of Coleen C. Shannon Page 1 ) ) [W]e took an approach where we looked at a number of cases, two cases in each way, one where there was a structural component associated with the trap and two, where there was a stratigraphic only component to the trap. So what we did was we mapped out net sand above a lowest known gas level and mapped that sands in both cases and then went to the next contour interval, 50 feet down, and drew a boundary around the two cases and what and that's what you're seeing here, is the extent of a boundary around the two cases for each of the sands. As- suming that you have a single net sand map, a lowest known gas level defined by Pretty Creek 4 and a structure map that on each at the top of each of the sand maps. 4. During the hearing, in response to questioning by Chairman Norman, Jeff Smetanka of Unocal testified respecting the Map as follows: CHAIR NORMAN: So, Mr. Smetanka, so I understand then, the orange or tan or- ange is superimposed on top of the magenta boundary there and that depicts the geographic limits of what you expect the reservoir to be, is that correct? MR. SMET ANKA: That's correct. 5. Unfortunately, I believe we may have left the Commission with the misimpression that Unocal's current interpretation is that the areal extent of the proposed storage reservoirs is coin- cident with the two colored areas on the Map. The purpose of this affidavit is to correct that pos- sible misimpression. 6. The two colored areas on Exhibit A are larger than our best estimates for the storage areas. The Map was developed as part of a slide presentation in connection with our work with the Department of Natural Resources, Alaska Oil and Gas Division, in determining the most ap- propriate storage lease area for the project. Due to uncertainties related to reservoir distribution and trapping mechanism, and the quality and quantity of available geologic and geophysical data, two geologic interpretations were developed for each proposed storage reservoir (45-0 sand and 51-5 sand). Each geologic interpretation was sized to match the original gas in place volumes determined from material balance analysis. An expanded area was then created by encompassing the areas from each case, adding an additional structural contour interval (50 feet) to the total area and drawing the polygon in a manner which assumes that certain faults do not seal. These are the areas depicted on the Map in Exhibit A. Thus the Map shows our cur- Pretty Creek Gas Storage Facility Affidavit of Coleen C. Shannon Page 2 ) ) rent interpretation of the areal extent of the storage reservoirs plus additional area assuming non-sealing faults plus the areal extent of the contour which is fifty feet lower. 7. To correct possible misimpression respecting Unocal's view of the proposed storage sands and to provide more information to the Commission, I have directed the preparation of five drawings and have attached these drawings to this affidavit as Exhibits B, C, D, E, and F. 8. As I previously testified, given the uncertainties concerning the extent of the reservoirs, I analyzed the data and developed two interpretations (Case 1 and Case 2) for the 51-5 sand and two interpretations (Case 1 and Case 2) for the 45-0 sand. Attached to this affidavit are drawings which show these interpretive cases both with and without the structural contour lines. Exhibit B shows the two cases I prepared for the 51-5 sand. Exhibit C shows the two cases I prepared for the 45-0 sand. Exhibit D shows the same 51-5 sand areas from Exhibit B super- imposed on a 51-5 sand structure map. Exhibit E shows a similar display for the 45-0 sand. Be- cause Exhibits D and E convey highly proprietary information and interpretations, Unocal is pro- viding the commission these figures with the understanding that they will be held in strict confi- dence and not be released to the public. Finally, I directed the preparation of an additional draw- ing, Exhibit F, which combines the cases for the 45-0 sands and the 51-5 sands in a single draw- ing. Exhibit F is the proper substitute for the Map shown at the hearing. 9. I apologize for any misimpression we may have created. I am available to answer any Date: 1 A><~ ~065 ---------- , additional questions the Commission may have afte materials. The foregoing was subscribed and sworn to or affirmed ~ ~~ of August, 2005. Notary Public in and for the State of Alaska My Commission Expires: ß· ~q . OCo Pretty Creek Gas Storage Facility Affidavit of Coleen C. Shannon Page 3 ) .)36')')0 ;34.0p)OO,344000 . I . . . . I . . . . I . . . . I . . . . , . ) 34S!ðX1 I . . . . I . . . . I I Pr~'tty.'Creek Unít: pro. DOSed. . 'Gas. Storaae .Areas )¿^·JI\-",.!:.^-.....-X-JC;-;IIC;->l'-X-U u I x I )C J )( )(x-xl I X )(- )(.'- ~ :1 )( I ·x I x 1 x :1 )( ~ )( I 'X r. x S ·1 ~~ f oJ"········ n\.~!n"~_I1iii\~Iii'.."..,."."...,',.. ........,...........I'lIl\;...,,'...... ·x [ * I r ~ x ¡ J ª )( ~ , ' x I t j ~ ¡ X ! I I x ~ - ..... .)( U )( ·H· U 1)( 1'4 )( II Pretty Creek Unit Boundary I tt·-· )(u U )t'..¡( x o. ~- I N' §. ~~ ~~ ~. )( Jt· J. .. ). §. ~~ '44 - - ::c - rX-)(:- )( I X )I' - - = .~ :: ~~ - - - - - - - - ..., 1 ~ ~~ .... - .ª - - .... .... .~ ~~ - - - - .... .... ~ .1'>.'0 (to I -~ )( I '0 x I x )! - .... ..... ~ . PCU-01 e I) 10-)0 ~ 3ð().') 4<)00 ~·)(Jn ~w... I I I I 1 :-3i)(ÞX .ns'I).).:) . . . I . . . ~O'·) 00 . . . I . . . 344003 , . . . . , . 34W).') .~ -t .§ . , EXHIBIT A ) ) Pretty Creek Gas Storage Reservoir Area 51-5 Sand Cases 1 & 2 20 21 22 23 PRETTY CREEK UNIT "'·~",E"3Ã~ærm:~w~:=1i!ìirD'i!:_i.15jmr~_iHim¡ii!r~ii.mt;1æi~;;¡¡¡¡¡;m~~i5Œ;_\il~¡¡¡;~£iiT~R:" _"_J29 i1W~,~~"""i."'('f ,I 28 27 i¡,j.,~I!, II 1" t"( I~,,',I ~ ~ II t:I:1 ¡¡ ~ t-3 " t-3 í~ ~ " 0 '~,! ~ ,t:I:1 I~ t:I:1 I',,'¡,:'," ~ ~:! c I ~ z 11¡~,I,,\j H ï~¡~ t-3 ¡II!' - ~l' E-I H Z t:). ~: ¡:i ¡:i 0::; o ~ 32 E-I µ:¡ 0::; Q..¡ 5 34 35 ~ I :,~tJJ. ',,~ 11:/1\ ~l¡; ~J 3 œt ~1~,Pj \~ "f I~I It,) ~I~ -J .,,=~~~~;~~ PRETTY CREEK UNIT '~ 'I T14N R9W ~ T13N R9W ,II ~! 2 C 10 11 ,. ' 9 Pretty Creek Unit . PCU 51-5 Case 1 . PCU 51-5 Case 2 UNOCALfØ 0.5 0.25 0 0.5 EXHIBIT B I I Miles ., ) ) Pretty Creek Gas Storage Reservoir Area 45-0 Sand Cases 1 & 2 ,.'" 20 21 22 23 . 29' PRETTY CREEK UNIT ';_E~i,'iI¡m.\¡¡;~::;¡¿¡:riì~¡;r;:~iifiiii:1~:5¡¡;¡iir.i~~m::iB,:=~~~i?_~_Jt5;¡b¡¡;Eæi::iii:¡¡æ~~=3iiæi:¡E'i.esm£iii\i:"I".a¡~~- ~I' !~! ~~~ ~~ ;g ~~~~ tIj ~1'j\1 t-3 Wi,l t-3 ~I~ r< 28 27 I g ~"'" tIj ~I~ tIj 'ß~¡ ~ !:I~ r~ ~ I~ F,:~,',~,', ~~ í,',~,i,l¡, I'J'~ ~~ ~,,",~'\," ¡'Ii~ ~,¡ 34 35 E-t H Z D ~ Ï] , Ï çx; ,,' u ~ E-t E-t Ï], çx;, 0../ 32 r';ij,:';","""";ï:~' I~-? ·I~,I,I,:, ~. . ~ I "\1i\i !~ 1~','¡," I.I~ i' \~ im 5 3 ¡?~~ ì ~ 1 ' ¡~J i~,m¡ . ~ i ,I i(~~ .'1 :~:~:;"'i;:;:~~~~¡;~~~£.".'"-~;,¡.,,,.~..,;~¡;;;~:~"=~~??~;:;~:::¡,:;,,\;;;+.:,;;;;¡.:¡:*:;;,;;.~'S3:i~"'¿£":f1t~~sJ~ PRETTY CREEK UNIT ~ T14N R9W J T13N R9W 2 C 10 11 , ' Pretty Creek Unit 9 , D PCU 45-0 Case 1 [J PC U 45-0 Case 2 UNOCALe 0,5 0.25 0 0.5 EXHIBIT C I I Miles _I 'r- ... 1" · ) ) ¡, Pretty Creek Gas Storage Reservoir Area 45-0 and 51-5 Sand Overlay 20 21 22 PRETTY CREEK UNIT ~~_w~~S';ì:3E~I~n~;£t5i\=~SB~il*8ii~\,M"i¥~~;,:æ~SSii~iS'~:';:Ii~¡irn;,1~"S~5:~£:.t.~'8if3 'ffi''''"29'¡¡'''' 28 27 34 E-i H Z D ~ µ:¡ ~ 0:; 0' l'lù ¡!,~ ¡¡"I¡. i~~ \'¡~I' '1:ri;:6=~.im!~~:¡ ::1¡;1 Ii '~~ ~~ ¡¡I ~:i~ ¡¡¡Iii \11 ;\rl lIlt ~1;1 :~ 3 1111:_' ¡;i,i I,'~ l\~ ~ ~,)~ ·f ~ ~ ~ -.'\~,"¡;:;,:."'~~\~>ètC''"':':i:n:\~,~;~:G¡:,ìr~'\;.;;li;¡~;:'~~~~'iëii:!2~~=~£~''::£~¡=::i'i.~E~~~;=~~'i~.t!,~ I PRETTY CREEK UNIT 32 I T13N R9W , , 5 C'~"""'-~,I I .- . . o [] UNOCALii) Pretty Creek Unit PCU 51-5 Case 1 PCU 51-5 Case 2 PC U 45-0 Case 1 PCU 45-0 Case 2 23 I'I~ 'I~",'I¡M , ~, f!r~ rcJ f,1"~ ~ \1 tJ:j ij,11¡ t-3 !"ì,I~~ f-3 n~ 1\'. ,i~ 'Ii 0 ~~ ~ ~\¡¡\ M ¡¡I~j M 1;lj,~ ~ ¡¡!~ d 18,~ ~ ~ ~I \~~ 'i:t~ 35 2 9 10 11 0.25 o 0.5 I EXHIBIT F 0.5 I Miles #23 Re: Open record period for PC Storage Project ) :~ S.~;~j.e.~t.:....~e:....Op.en...record...p.e.~Qd·fo~·.pp·.·...Stor(l~y .Proj·~c~ Fr~:Iq:..I~OJnªS.··.·I\1aunder. ~to.m__111aµn4er@ª<1iTïirl;state;(lk.~s:> . . nª~e:Tµ;e,16 Aµg 20Q514:4.4:$.o.~08PQ Thanks Jeff. After receiving your call earlier this morning, I did check with Commissioner Norman and the record is open until 16:30 tomorrow August 17. Tom Maunder, PE AOGCC Smetanka, JeffW wrote, On 8/16/2005 12:21 PM: Tom, Thank you for checking with Commissioner Norman and for confirming with me that the open record period for the Pretty Creek storage project extends until 4:30 PM on Wednesday, August 17th. As we discussed, Unocal plans to submit additional material for the record within this open record period. Thanks, Jeff 1 of 1 8/16/2005 12:24 PM #22 ( 1 ALASKA OIL AND GAS CONSERVATION COMMISSION ( 2 Before Commissioners: John K. Norman, Chairman Daniel T. Seamount Cathy Foerster 3 4 In the Matter of the Application ) 5 of UNOCAL for a storage Injection ) Order, Pretty Creek Gas Storage ) 6 Facility ) ) 7 8 ALASKA OIL and GAS CONSERVATION COMMISSION Anchorage, Alaska 9 August 10, 2005 9:00 o'clock a.m. 10 11 VOLUME II PUBLIC HEARING 12 BEFORE: John K. Norman, Chairman Daniel T. Seamount, Commissioner Cathy Forester, Commissioner 13 ( 14 APPEARANCES: 15 FOR UNOCAL: MR. MARC BOND Unocal Assistant Counsel 909 East Ninth Avenue Anchorage, Alaska 99501 16 17 18 FOR TRADING BAY OIL & GAS: MR. WILLIAM M. BANKSTON Bankston, Gronning, O'Hara, Sedor, Mills, Givens & Heaphey, PC Attorneys at Law 601 West Fifth Avenue suite 900 Anchorage, Alaska 99501 19 20 21 22 23 24 25 ( R & R C 0 U R T R E P 0 R T E R S 810 N STREET (907)277-0572/Fax 274-8982 ANCHORAGE, ALASKA 99501 . . . . . 11 13 14 . 30/44 35 41 . . . . 48 · . . · . . . . . . . · . . . ANCHORAGE, ALASKA 99501 810 N STREET (907)277-0572/Fax 274-8982 R & R C 0 U R T R E P 0 R T E R S Opening remarks by Chairman Norman Remarks by Marc Bond Testimony by Jeff Smetanka Testimony by Paul craig . . . . . . . Testimony by Erik Opstad Remarks by William Bankston Testimony by Coleen Shannon . . . . . . . . . . . . TABLE OF CONTENTS ( 1 2 3 4 5 6 7 8 9 10 11 12 13 ( 14 15 16 17 18 19 20 21 22 23 24 25 ( ( ( 1 PRO C E E DIN G S 2 Tape 1 3 0015 4 (On record - 9:02 a.m.) 5 CHAIRMAN NORMAN: Good morning. I will call this hearing 6 to order. This is a hearing before the Alaska oil and Gas 7 Conservation commission being conducted on the morning of 8 August 10. This is a reconvening of the hearing originally 9 convened on July 26th, 2005. The hearing was convened and then 10 subsequently continued to today at the request of the 11 applicant. 12 The record reflects that notice was duly published in the ( 13 Anchorage Daily News. If anyone would like a copy of that 14 notice you may see the Commission's public assistant. 15 The record also reflects a public comment in the form of a 16 letter by Cook Inlet Keeper signed by Lois Epstein (ph) P.E. in 17 which there are some suggested alternatives that the Commission 18 is asked to look at. If the applicant has not received a copy 19 of this letter, then we want to be sure that you do get a copy. 20 Additionally, on July the 11th a request for this hearing 21 was filed by Trading Bay oil & Gas, LLC, and we recessed with 22 the stated intention of reconvening this morning to consider 23 this application. 24 This hearing is being conducted in accordance with 20 -- 25 Alaska Administrative Code 25.540 which pertains to hearings ( R & R C 0 U R T R E P 0 R T E R S 810 N STREET (907)277-0572/Fax 274-8982 ANCHORAGE, ALASKA 99501 11 { 1 2 3 4 5 6 7 8 9 10 11 12 13 ( 14 15 16 17 18 19 20 21 22 23 24 25 ( before the Commission. Generally the order of business is that we convene the hearing, the Commission will receive sworn testimony from witnesses. If any person does not wish to be sworn we will respect your wishes, however, we do give greater weight to sworn testimony than unsworn testimony. Each witness will be asked to come forward, state your name, who you represent and an Oath will be administered. If your intention is to provide expert testimony, then at the beginning of your testimony we will want a statement of your qualifications so that we know who we are hearing from. A written transcript of this hearing will be prepared. ordinarily we do not allow cross examination of witnesses. However, it is within the discretion of the Commissioners to do so if good cause is shown by someone. Generally speaking, if any persons present wish a question answered you can provide it in writing and get it to a member of the Staff or on a recess to the Commissioners and then we will do our best to see that all relevant questions are answered. The matter before us is an application for underground storage of hydrocarbons and as I mentioned the application was filed by Union oil of California on May 10th and our purpose today is to consider that application. I'll first introduce on my right -- my name is John Norman and I am the Chairman of the Commission. On my right is commissioner Dan Seamount, the geologic commissioner. On my R & R C 0 U R T R E P 0 R T E R S 810 N STREET (907)277-0572/Fax 274-8982 ANCHORAGE, ALASKA 99501 12 13 ANCHORAGE, ALASKA 99501 810 N STREET (907)277-0572/Fax 274-8982 R & R C 0 U R T R E P 0 R T E R S CHAIRMAN NORMAN: Yes, thank you, Mr. Bond, and we'll 25.540(c) (10). consideration for keeping it confidential pursuant to 20 AAC information may be requested, at that point I would ask for commission it is possible that confidential or proprietary information. However, in response to questions from the will make, to enter into confidential or proprietary intention during the presentation that Mr. Smetanka, to my left I note only for purposes of the record that it isn't our presentation without interruption from me. my intention to allow our engineers to go ahead and make that established for underground storage under 20 AAC 25.252. It is making a presentation to the Commission on the criteria least until today that's who I'm counsel for. We will be I am assistant counsel for Union oil Company of California at MR. BOND: Thank you, Mr. Chairman. My name is Marc Bond. proceed. CHAIRMAN NORMAN: Okay. Then I think we're ready to COMMISSIONER FOERSTER: Nor do I. CHAIRMAN NORMAN: Commissioner Foerster. COMMISSIONER SEAMOUNT: I have nothing, Mr. Chairman. start? commissioner Seamount, do you have anything before we commissioner. left, Commissioner Cathy Foerster, the engineering ~: ~ 1 2 3 4 5 6 7 8 9 10 11 12 ( 13 14 15 16 17 18 19 20 21 22 23 24 25 ( 14 ANCHORAGE, ALASKA 99501 810 N STREET (907)277-0572/Fax 274-8982 R & R C 0 U R T R E P 0 R T E R S Petroleum Engineering in 1982 from the University of Tulsa. I MR. SMETANKA: Okay. I graduated with a Bachelors in credentials? some statement of your educational experience and your other testimony as an expert witness then could you, please, give us CHAIRMAN NORMAN: And if it is you intention to offer MR. SMETANKA: Unocal. CHAIRMAN NORMAN: And who do you represent? MR. SMETANKA: Jeff Smetanka. CHAIRMAN NORMAN: Please state you name? TESTIMONY BY JEFF SMETANKA MR. SMETANKA: Yes, I do. (Oath Administered) hand, sir. CHAIRMAN NORMAN: Very good. Can you raise your right testimony. turn it over to Mr. Smetanka to be sworn and present his MR. BOND: Thank you, Mr. Chairman. with that I'd like to that time. then you can bring it to our attention and we'll consider it at that you believe is proprietary, deserving of confidentiality, certainly hear you and will look to you if we get into an area The burden will be upon anyone asserting a privilege, but we'll have as much information as possible into the pubic record. certainly respect that. It is the bias of the Commission to (' f 1 2 3 4 5 6 7 8 9 10 11 12 13 ( 14 15 16 17 18 19 20 21 22 23 24 25 ( ( 1 2 3 4 5 6 7 8 9 10 11 12 ( 13 14 15 16 17 18 19 20 21 22 23 24 25 ( have 22 years of experience in the oil industry, 17 years with Unocal. The last 11 years have been in the petroleum engineering, reservoir engineering area. The last nine years here in Alaska working the Cook Inlet properties. I'm a registered petroleum engineer in Colorado as well. CHAIRMAN NORMAN: Regarding the qualifications, commissioner Seamount, any questions? COMMISSIONER SEAMOUNT: I have no questions. CHAIRMAN NORMAN: Commissioner Foerster? COMMISSIONER FOERSTER: No. CHAIRMAN NORMAN: Just one question, have you had any experience in storage reservo- -- in use of reservoirs for storage? MR. SMETANKA: Yes, I submitted the first application for the KGSF-1 gas storage facility in 2001. MR. BOND: Excuse me, that would be the Kenai Gas Storage Facility at the Swanson River Field. MR. SMETANKA: So, yes, I've got experience in designing and managing gas storage since that time. CHAIRMAN NORMAN: Okay. Well, we will accept your qualifications as an expert witness and you may proceed. MR. SMETANKA: Okay. I have a short presentation that I'd like to show that goes over our application for this storage order. Unocal, as Marc mentioned, is requesting this storage R & R C 0 U R T R E P 0 R T E R S 810 N STREET (907)277-0572/Fax 274-8982 ANCHORAGE, ALASKA 99501 15 ! \ ( 1 order for the Pretty Creek area to help meet the utility gas 2 market demands in the Cook Inlet. This storage deliverability 3 helps ensure that the peak winter demands in the Anchorage area 4 are met so we feel this is an important component of the gas 5 supply in the Cook Inlet. 6 Unocal feels we've met all the AOGCC requirements for 7 storage application and what I have in the presentation is a 8 summary of that app- a summary of the requirements. The 9 code that guided our application was 20 AAC 25.252(c) and it 10 spells out the requirements for a storage application and 11 that's what we followed and the following slides address that 12 code. ( 13 One of the first requirements in the code is a plat 14 showing the location of all the proposed storage wells. Any 15 abandoned wells, unused wells, any production dry hole wells 16 within one quarter mile of each proposed storage well. 17 My next slide shows those two plats. You can see I have 18 two plats, one for each sand. This is the 51 -- we have two 19 sands that we intend to store gas into, the 51-5 sand and the 20 45-0 sand. 21 The one on the left is the 51-5 sand and what we've done 22 is drawn a quarter mile radius around the penetration of the 23 Pretty Creek 4 well in the 51-5 sand and likewise we've done a 24 quarter mile radius around the penetration in the 45-0 sand. 25 You can see there's not a lot of wells in that area. There are ( R & R C 0 U R T R E P 0 R T E R S 810 N STREET (907)277-0572/Fax 274-8982 ANCHORAGE, ALASKA 99501 16 { 1 2 3 4 5 6 7 8 9 10 11 12 ( 13 14 15 16 17 18 19 20 21 22 23 24 25 ( no wells that are within that radius. You can see the Pretty Creek 2 well there on 224-28. The next requirement from the code is to list all the operators and surface owners within a one quarter mile radius of each proposed storage well. As I showed on the previous slide that Unocal is the operator and the state of Alaska, Department of Natural Resources as the surface owner and that was stated in the application. The next item in the code is an affidavit showing that the operators and surface owners within that one quarter mile radius had been provided a copy. We did do this. We provided a copy to the state of Alaska DNR. We also provided a courtesy copy of the application to Mr. Francis H. Grant due to the proximity of his land in the storage area. Mr. Grant owns a 20 acre parcel within the Pretty Creek unit. It is three quarters of a mile from the well, but we provided him a copy so -- to inform him of what we were doing. The next item in the code is to talk about the storage formations. There is more detail in our actual application, but I'll go through some high level information here sand by sand. The first sand is the 51-5 sand and this is a primary reservoir that we intend to do gas storage. It's a Beluga formation. The sand top in the Pretty Creek 4 well is at 5,144 R & R C 0 U R T R E P 0 R T E R S 810 N STREET (907)277-0572/Fax 274-8982 ANCHORAGE, ALASKA 99501 17 ( 1 2 3 4 5 6 7 8 9 10 11 12 ( 13 14 15 16 17 18 19 20 21 22 23 24 25 ( , feet measured depth and that's 3,585 feet below sea level. It's a 20 foot thick sand. It lies under siltstone and mudstone, 10 feet measured depth thickness above -- immediately above. It overlies the coal that we call the PC4 coal which is 21 feet thick. The next slide is a log section that we included in our application and it just shows the 51-5 sand and it -- you can see the coal underneath and the siltstone, mudstone above. The second storage formation is the 45-0 sand. This is a sand we do not intend to use initially. It's a sand that we may expand the storage into in subsequent years. It's a sterling formation. Sand top in Pretty Creek 4 is at 4,503 feet measured depth, 3,185 feet subsea. It's a nine foot thick sand. It lies between two coals, a 36 foot coal above and 33 foot coal below and you can see that on this log section. You can see the coals and the gas sand is right in between. In addition, all the open hole logs from the wells in the Pretty Creek unit were sent to the AOGCC when the logs were completed and those should be on the record. The next item is the mechanical integrity, how we will prove mechanical integrity of our storage well. The Pretty Creek 4 well will be tested for mechanical integrity using a standard 30 minute annulus test as per the AOGCC guidelines at 20 AAC 25.412. Unocal will monitor the injection rates and pressures R & Reo U R T R E P 0 R T E R S 810 N STREET (907)277-0572/Fax 274-8982 ANCHORAGE, ALASKA 99501 18 ( 1 2 3 4 5 6 7 8 9 10 11 12 ( 13 14 15 16 17 18 19 20 21 22 23 24 25 ( daily and will notify the AOGCC the next working day if the data, the rates and pressures indicate there's communication or leakage. And, of course, the monthly data would be provided to the AOGCC for the pressure and rate information. The next slide is a schematic that shows how the well is completed, the Pretty Creek 4 well. There are three gravel packs in the well. The 45-0 sand is the upper completion. The 51-5 is the middle completion and the 56-5 is the bottom completion which never flowed any gas. There is a two and seven-eighths tubing string with a two and seven-eighths inch inner string inside the gravel pack that has sliding sleeves across each zone so that we can selectively inject into or produce any zone or commingle them. There's seven inch casing down to about 6,900 feet and the nine and five-eighths casing is about 2,400 feet. The storage fluid, we intend to store predominately methane, 98 percent methane, natural gas into the well. This will be sourced from our own production or it will be purchased or exchanged from other operators. The actual fields it will be sourced from is McArthur River Field, the Steelhead platform, Grayling gas sands, Beluga River Field or any properties on the West Side of Cook Inlet could be possible sources of the gas. We estimate the maximum injection rate of 20 million a day going into the well. And then I've got a gas analysis to the right there that R & R C 0 U R T R E P 0 R T E R S 810 N STREET (907)277-0572/Fax 274-8982 ANCHORAGE, ALASKA 99501 19 ( 1 2 3 4 5 6 7 8 9 10 11 12 ( 13 14 15 16 17 18 19 20 21 22 23 24 25 , , { shows the components. It's 97.87 percent methane, some nitrogen and C02, but predominately methane which is typical in the Cook Inlet. Injection pressures, we estimate the average injection pressure will be 1,550 pounds psig. The maximum injection pressure will be 2,500 psig. We intend to maintain surface pressure such that a gradient of .65 psi per foot at the formation is not exceeded. Leakoff test data performed during the drilling of the well, Pretty Creek 4, indicated fracture gradients of higher than .82 psi per foot. We had two measurements at each casing shoe or one at each casing shoe, .82 psi per foot at the deeper shoe at 5,104 TVD and 0.99 psi per foot at the shallower shoe at 1,977 feet. Another requirement of the regulation is to supply water analysis. We had two samples that were measured at the laboratory. These were included in our application. These are produced water samples from the well collected in May 2004 and one in May 2005. The first sample was 22,459 milligrams per liter TDS, total dissolved solids, and the 2005 sample was nearly 10,000. It was 9,856. We believe the first sample was representative of the upper sand and the second sample was representative of the 51-5 sand where we intend to initially inject. Mechanical condition of the well, this is requested also R & R C 0 U R T R E P 0 R T E R S 810 N STREET (907)277-0572/Fax 274-8982 ANCHORAGE, ALASKA 99501 20 21 ANCHORAGE, ALASKA 99501 810 N STREET (907)277-0572/Fax 274-8982 R & R C 0 U R T R E P 0 R T E R S deliverability can be available for the market as soon as application so that we can commence storage so that the gas injection order and we request prompt approval of the application meets all the AOGCC requirements for the storage storage facility for the Cook Inlet market. We feel the So in summary Pretty Creek represents an important gas with for storage. isolation, so we think we have a good mechanical well to work straight line trend on the P over Z plot which indicates produce the 51-5 in isolation and the pressure behavior was a able to shut a sliding sleeve and shut that water off. And zonal isolation because the 45-0 sand watered out. We were The subsequent production behavior is indicative of full happy with the remedial cement job. returns. We had 12 barrels of cement at surface so we were cement from approximately 5,600 feet to surface. We had full did some remedial cemented. We perforated and circulated was only in the deeper part of the hole, 69 to 5,900 feet so we after the seven inch was cemented and it showed that good bond had full returns to surface. We did run a cement bond log tested within regulations. When we cemented the seven inch we The casing was cemented according to state regulations and November 2001 so it's a fairly new well. provided. The Pretty Creek 4 well was drilled and completed in in the regulations and here's some summary information that we Iii i ( 1 2 3 4 5 6 7 8 9 10 11 12 ( 13 14 15 16 17 18 19 20 21 22 23 24 25 ( 22 ANCHORAGE, ALASKA 99501 810 N STREET (907)277-0572/Fax 274-8982 R & R C 0 U R T R E P 0 R T E R S MR. SMETANKA: We do. In fact, the .65 psi per foot of going over original pressure in your storage? then Pretty Creek 4. COMMISSIONER SEAMOUNT: Do you ever foresee a possibility did not have any additional zones that they saw potential in They identified additional potential for Pretty Creek 2, but reservoir engineering firms look at the Pretty Creek property. identified anything to date and we've had third parties, of the wells. We put together those projections and we haven't reserves other than the remaining gas in these two -- well, in the 51-5 zone. We haven't identified any unproven reserves in terms of our -- the work that we do for managing the depletion In the Pretty Creek 4 well we don't have any proven be better in the future for pursuing those. justify them under past prices so I think the opportunities may for those projects in the past and have not been able to identified in the Pretty Creek 2 well. We've tried to budget MR. SMETANKA: We have some additional opportunities you feel it's been adequately tested? potential gas reservoirs in this field that you know of or do COMMISSIONER SEAMOUNT: Mr. Smetanka, are there any other commissioner Seamount. Let me see if we have any questions of the Commission. CHAIRMAN NORMAN: Good. Thank you for your testimony. possible. That's all I have. ( ( 1 2 3 4 5 6 7 8 9 10 11 12 '< 13 14 15 16 17 18 19 20 21 22 23 24 25 \ 23 ANCHORAGE, ALASKA 99501 810 N STREET (907)277-0572/Fax 274-8982 R & R C 0 U R T R E P 0 R T E R S ( 25 in it- -- at one time in the early stages, but I'd have to look 24 you for sure. I believe we had a rate of six million a day MR. SMETANKA: The initial production rate I couldn't tell 23 22 rate of this well? COMMISSIONER SEAMOUNT: What was the initial production 21 20 is under the frac gradient. 19 based on the data we've seen that a .65 psi per foot gradient 18 to us, too, that we not lose any gas, but we feel comfortable 17 'cause that's real money lost to Unocal so it's very important 16 If that happens, of course, we're not going to continue gas. 15 ( here with the 51-5 sand, we'll be able to see if we're losing 14 13 with a volumetric reservoir which we think we're dealing with 12 net volumes in and out of the reservoir and if you're doing 11 our first storage project. We monitor pressures and volumes, 10 clearly with -- based on the surveillance work we've done on MR. SMETANKA: I believe we'd be able to tell pretty 9 8 be able to tell? 7 losing the gas if you did go over original? I mean, would you COMMISSIONER SEAMOUNT: Do you not see a possibility of 6 4 this application to go to .65 psi per foot which will enable us 5 to have higher deliverability and larger storage capacity. 3 the Cook Inlet which is .45 psi per foot. We are requesting in feel is a normal gradient which is what we tend to see most in 2 l I:; gradient is above original pressure. The original pressure we 1 ~ 24 ANCHORAGE, ALASKA 99501 810 N STREET (907)277-0572/Fax 274-8982 R & Reo U R T R E P 0 R T E R S initial period, in the, I'd say, two year period, maybe three produced both the 45-0 and the 51-5 zone together in the MR. SMETANKA: Right. What -- let me explain on that. We you completed in the 51-5 you had a straight line P over Z? COMMISSIONER FOERSTER: Okay. Well, you said that when MR. SMETANKA: No. the 51-5 and produced only the 45-0 until it watered out? COMMISSIONER FOERSTER: So then you subsequently shut in normal pressure gradient was there. between the two which certainly allows you to believe that the going to see the full pressure of the 51-5 zone, but it lied in open there's going to be cross flow going on and so you're not When you measure one point in the well with both zones would be higher. would be at a lower pressure being the shallower zone. 51-5 the 45-0 and the 51-5 zone open so I would expect the 45-0 zone initial point that we measured was with both zones opened, with you observed comparable to the .465 (ph) gradient? MR. SMETANKA: What we had is the initial data, the production from the 51-5 sand was the original pressure that COMMISSIONER FOERSTER: Mr. Smetanka, when you started CHAIRMAN NORMAN: Commissioner Foerster. have no further questions. COMMISSIONER SEAMOUNT: Okay, thank you, Mr. Smetanka. I back at the data. ¡" \ ( 1 2 3 4 5 6 7 8 9 10 11 12 ( 13 14 15 16 17 18 19 20 21 22 23 24 25 ( 25 ANCHORAGE, ALASKA 99501 810 N STREET (907)277-0572/Fax 274-8982 R & R C 0 U R T R E P 0 R T E R S reservoir there's a certain amount of losses that are expected don't know at this point is -- what kind of impact that will be. I think any time that you conduct gas storage in a MR. SMETANKA: The 51-5 sand has a coal below it so I COMMISSIONER FOERSTER: Um-hum. the two coals is the 45-0 zone which is our secondary target. MR. SMETANKA: That's prim- -- the zone that's adjacent to the coal? that's above and below it, you know, any absorption of gas in concern for the gas having a negative interaction with the coal COMMISSIONER FOERSTER: That makes sense. Do you have any producing that remaining water. flowed from the 45-0 on (ph) the 51-5 and we were just tailing off and so what we assumed is that the water had cross gas with water so we put it back on and the water started When we tried to flow the 51-5 zone in isolation it flowed we got nothing whatsoever so we closed it. isolation and when we tried to flow the 45-0 zone in isolation, starting closing sleeves and flowing individual zones in We tried to flow it to atmosphere and it wouldn't flow. So we When we tried to bring the well back on it wouldn't flow. surface and we had to shut the well in. more and more water, but we had a mechanical problem on the We tried to bring it back on. We knew it was starting to make year period. The well watered out and we shut the well down. ( ( 1 2 3 4 5 6 7 8 9 10 11 12 (' 13 , 14 15 16 17 18 19 20 21 22 23 24 25 ( 26 ANCHORAGE, ALASKA 99501 810 N STREET (907)277-0572/Fax 274-8982 R & R C 0 U R T R E P 0 R T E R S MR. SMETANKA: Um-hum. The watered out zone is not as interaction, you know, same question in reverse, too? injecting into the watered out zone and potential of that COMMISSIONER FOERSTER: Do you have any concern for MR. SMETANKA: Um-hum. COMMISSIONER FOERSTER: One more question. gas. to use to verify that we're keeping whole on our volumes of production side, but that's the main technique that we're going curve probably on the injection side and under on the straight line P over Z trend down it's going to go over the always historistic effect where instead of following the gas, net gas, is in and look at the pressures. And there's reservoir on a material balance basis so we look at how much MR. SMETANKA: Our main monitoring steps are to manage the what will be your threshold for deciding to stop? that you have to determine if it's going to be a problem and COMMISSIONER FOERSTER: So what are your monitoring steps it's a great concern though. don't know how the reservoir is going to act. I don't think until you put gas in and take it out over a cycle you really greater than that, but similar to the first project we did I wouldn't think that this absorption effect would be percent. and it's small, you know, it's maybe on the order of five I~ ( 1 2 3 4 5 6 7 8 9 10 11 12 ( 13 14 15 16 17 18 19 20 21 22 23 24 25 ( 27 ANCHORAGE, ALASKA 99501 810 N STREET (907)277-0572/Fax 274-8982 R & R C 0 U R T R E P 0 R T E R S zones as -- and that's from the two zones? CHAIRMAN NORMAN: And insofar as using these receiving MR. SMETANKA: I believe that's pretty close, yes. I understand? production from this well is about 2.7 bcf, is that right, what CHAIRMAN NORMAN: Okay. Mr. Smetanka, the cumulative COMMISSIONER FOERSTER: I do, too. Thank you. little more risk than the 51-5. have the option to do that in the future. I think it has a our first target for gas storage in this well, but we want to a bit of an experiment for us and it's -- that's certainly not gas and we may not lose any more gas at -- so it's going to be In this case the water has already come in and trapped the case when you're putting gas into a aquifer you know you're going to lose gas that's going to be trapped as that water comes back in. -- you know, gas storage is conducted in aquifers and in that the water comes back in too quick and traps some gas, but the There's also a reserve loss issue that you could have if to depose of. There could be hydrate problems. could have water handling problems on the surface that you have you start producing a lot of water you could lose rate. You out gas zones have the potential for production problems. If we've been looking for is depleted gas reservoirs. The watered ideal as injecting into a depleted gas reservoir. Ideally what { 1 2 3 4 5 6 7 8 9 10 11 12 ( 13 14 15 16 17 18 19 20 21 22 23 24 25 ( 28 810 N STREET (907)277-0572/Fax 274-8982 ANCHORAGE, ALASKA 99501 R & R C 0 U R T R E P 0 R T E R S CHAIRMAN NORMAN: And just on orders of magnitude how much into the reservoir so it would be an incremental amount. we're going to have to put more material into the -- more gas per foot, because that's higher than the original pressure, MR. SMETANKA: Yes. And in order to go to that .65 psi gas than was previously produced from the reservoir? CHAIRMAN NORMAN: Would you anticipate ever injecting more of me. little higher than that and I don't have that number in front because we're asking to go to .65 psi per foot it would be a back in to the reservoir I would guess this first go round, but 2.07 bcf and I believe we're looking at getting roughly 85 percent of that so 1.7 b's (ph) is what we'll intend to put -- we've estimated the gas in place for the 51-5 sand to be have the exact volumes in front of me, but it's -- I know the We don't actually go to the .65 psi per foot, but I don't that's what's going to happen or not. we do that initially maybe the first season. I don't know if sand, filling it back up to original. I would anticipate that the 40- -- what we'll do is plan on injecting gas in the 51-5 MR. SMETANKA: Well, we intend to fill the reservoir back, the. . . . . storage what volume would you anticipate injecting back into CHAIRMAN NORMAN: Okay. And as far as using these for MR. SMETANKA: That's right. ~:' { 1 2 3 4 5 6 7 8 9 10 11 12 ( 13 14 15 16 17 18 19 20 21 22 23 24 25 ( 29 810 N STREET (907)277-0572/Fax 274-8982 ANCHORAGE, ALASKA 99501 R & R C 0 U R T R E P 0 R T E R S see that at some time. copy of the specific letter that you referenced and we would to of Ms. Epstein's suggestion before I don't believe we have a I forgot to mention at the beginning while we've seen some time, Mr. Chairman, thank you. MR. BOND: We have no further witnesses to present at this CHAIRMAN NORMAN: Mr. Bond. MR. SMETANKA: Okay, thank you. until these proceedings are concluded today. Thank you. also ask that you remember that you would remain under Oath you stay and it might be that we would recall you. And we'd Mr. Smetanka, then you're excused, but we would ask that any persons? The Chair sees no one asking to be recognized. would have to be very relevant to the application. Are there that have some standing in this proceeding and the questions direct questions to the witness. These would have to be people such a request now if there are any persons that would like to allow cross examination, but if there are any persons present who feel like there may be some facts that could be elicited if you were enabled to ask questions, the Chair will entertain from the Commissioners. As I mentioned ordinarily we don't CHAIRMAN NORMAN: I believe that completes the questioning 40 percent more. MR. SMETANKA: I believe it'd be probably on the order of more would it exceed the original amount produced? ~,{ ( 1 2 3 4 5 6 7 8 9 10 11 12 ( 13 14 15 16 17 18 19 20 21 22 23 24 25 ( 30 ANCHORAGE, ALASKA 99501 810 N STREET (907)277-0572/Fax 274-8982 R & R C 0 U R T R E P 0 R T E R S MR. CRAIG: Correct. CHAIRMAN NORMAN: An adjacent property owner? entrepreneur with proprietary interest in neighboring acreage. of an expert. I'm testifying in the capacity of an MR. CRAIG: I'm -- no, I'm not testifying in the capacity capacity of an expert or more generally? CHAIRMAN NORMAN: Okay. And are you testifying in the MR. CRAIG: Yes, it is. commission? CHAIRMAN NORMAN: And that is the same entity that has -- that requested this hearing by a letter dated July 11th to this oil & Gas, LLC. MR. CRAIG: I'm a member and the manager of Trading Bay CHAIRMAN NORMAN: And who do you represent? MR. CRAIG: Paul Craig. CHAIRMAN NORMAN: Your name, please? TESTIMONY BY PAUL CRAIG MR. CRAIG: I do. (Oath Administered) right hand, please. Yes, sir, you may come forward. will you please raise your persons that wish to offer testimony today on this application? CHAIRMAN NORMAN: Very good. Then, are there any other MR. BOND: Thank you very much. CHAIRMAN NORMAN: We will see that you get a copy. ( 1 2 3 4 5 6 7 8 9 10 11 12 ~ 13 14 15 16 17 18 19 20 21 22 23 24 25 (' \ 31 ANCHORAGE, ALASKA 99501 810 N STREET (907)277-0572/Fax 274-8982 R & R C 0 U R T R E P 0 R T E R S total of 10.75 square miles of oil and gas leases, again, number, two, three and four so the last number is 390 104. A Unit. Those include ADL 389 934 and then 390 101 and that some leases immediately to the north and east of the Pretty Creek Just for the record Trading Bay oil & Gas holds five proposed storage facility in the Pretty Creek #4. reassuring to hear the engineering report regarding the the concept.· And I would also add that it's somewhat factor in terms of a healthy marketplace, so I'm not opposed to marketplace it's very clear to me that storage is a critical Cook Inlet. Being knowledgeable about the Cook Inlet gas supportive of Unocal's concept of developing storage in the Basically I would like to go on record as being highly testify when I'm done. I also have two other parties here who may wish to briefly development of the leases immediately to the north. leases. And as we speak am working on attempting to fund the attempted to raise capital for drilling of wells on these interest in leases in the state of Alaska since 1993 and have couple of different entities owning oil and gas working I've been involved with owning through one -- well, through a MR. CRAIG: Okay, thank you. As far as my credentials go testimony as an owner of adjacent property. Please proceed. background you may do so, otherwise we will receive your CHAIRMAN NORMAN: Very well. If you wish to state your :{ 1 2 3 4 5 6 7 8 9 10 11 12 ( 13 14 15 16 17 18 19 20 21 22 23 24 25 ( ( 1 2 3 4 5 6 7 8 9 10 11 12 ( 13 14 15 16 17 18 19 20 21 22 23 24 25 ( immediately to the north and east of the Pretty Creek unit. Trading Bay oil & Gas' concerns and reasons for request for this hearing are fairly simple. Basically I just am asking that the Commission take all of the data available to it and provide assurance that Unocal's storage proposal in the Pretty Creek unit will not in any way impact Trading Bay oil & Gas' operations to the north or to the east. The specific concerns in that regard would be assuming the Trading Bay & oil Gas does not request a spacing exception and does drill wells no closer than 1,500 feet to the boundary of the Pretty Creek unit that there be no subsequent claim on the part of Unocal or any successor to Unocal regarding the produced hydrocarbons from those zones in relation to this storage proposal. In other words, if we drill more than 1,500 feet from the boundary and test and produce from a zone that maybe analogous to the zone that's being injected that Unocal does not make a claim that we're producing their gas and that they're not using Trading Bay's leases for storage. Secondly, in terms of operation and I think that the same question has been answered, but I would like the Commission to look at it specifically, I am concerned about -- or Trading Bay oil & Gas is concerned about the possibility of an increased pressure gradient in any well that it were to drill more than 1,500 feet the Pretty Creek unit boundary and just want R & R C 0 U R T R E P 0 R T E R S 810 N STREET (907)277-0572/Fax 274-8982 ANCHORAGE, ALASKA 99501 32 ~ 1 2 3 4 5 6 7 8 9 10 11 12 ( 13 14 15 16 17 18 19 20 21 22 23 24 25 ( ~ \ reassurance that their operations will not influence normal pressure gradient in the zones being penetrated by a well drilled by Trading Bay oil & Gas or a partner. And, again, I would just close my testimony by saying that Trading Bay oil & Gas is supportive of Unocal's storage proposal to the extent it does not interfere with any aspect of Trading Bay oil & Gas' operations on adjacent properties. CHAIRMAN NORMAN: Thank you, Mr. Craig. If you'll remain there.... MR. CRAIG: Sure. CHAIRMAN NORMAN: .....there may be some questions. commissioner Seamount. COMMISSIONER SEAMOUNT: I have no questions. CHAIRMAN NORMAN: Commissioner Foerster. COMMISSIONER FOERSTER: No. CHAIRMAN NORMAN: I have just a couple. I wanted to make sure that I understand, you have leases outside the unit located to the north and east of the unit, correct? MR. CRAIG: Well, Trading Bay oil & Gas does. CHAIRMAN NORMAN: Trading Bay -- when I say you..... MR. CRAIG: Yes. CHAIRMAN NORMAN: .....I'm referring..... MR. CRAIG: Yes. CHAIRMAN NORMAN: .....to the entity that you're speaking for. R & R C 0 U R T R E P 0 R T E R S 810 N STREET (907)277-0572/Fax 274-8982 ANCHORAGE, ALASKA 99501 33 34 ANCHORAGE, ALASKA 99501 810 N STREET (907)277-0572/Fax 274-8982 R & R C 0 U R T R E P 0 R T E R S know whether -- I haven't thought whether we even have the wish that the Commission would condition its order -- I don't others that answer this, well, that's fine here, but it is your CHAIRMAN NORMAN: Is it your wish that -- and if there are expertise to answer that question. I don't. address that question on my behalf. He has the technical MR. CRAIG: No, I do not. I have Erik Opstad who could pressure gradient within your lease area? normal pressure gradient. And do you know now the normal was that the increase in pressure gradient not impact the CHAIRMAN NORMAN: And then a second concern that you had MR. CRAIG: That -- in essence, that's -- yes, that's it, that's one of the primary concerns. stored gas, is that it? you are producing their stored gas or impact drawing down their normal spacing unit, that you not face a claim by Unocal that commence regular production, and by regular I mean within the something that would address your concern. Your concern is that if in the future operations you then try to see if there is some way the Commission can fashion claim by Unocal and I want to be sure I understand this and operations. And then you mentioned a request that there be no that the proposed storage project would not impact Trading Bay CHAIRMAN NORMAN: And you mentioned desiring an assurance MR. CRAIG: Right. 1 1 2 3 4 5 6 7 8 9 10 11 12 ( 13 14 15 16 17 18 19 20 21 22 23 24 25 ( 35 ANCHORAGE, ALASKA 99501 810 N STREET (907)277-0572/Fax 274-8982 R & R C 0 U R T R E P 0 R T E R S CHAIRMAN NORMAN: And your name? TESTIMONY BY ERIK OPSTAD MR. OPSTAD: Yes, I do. (Oath Administered) right hand, please. wish to offer testimony on this matter? Please raise your CHAIRMAN NORMAN: Are there any other persons here who MR. CRAIG: I will and I do, thank you. CHAIRMAN NORMAN: .....understand? Thank you. MR. CRAIG: I will..... you. . . . . you to return to the microphone that you remain under Oath, do conclude the proceedings. And would remind you that if we ask ask similarly that if you are able to do so you remain until we CHAIRMAN NORMAN: Right. Well, thank you. And I would storage. Trading Bay leases are not being used for purposes of gas review of public and proprietary data has assurance that oil & Gas would have some assurance that the Commission through MR. CRAIG: Essentially, yes, that basically Trading Bay wind up? your wells, is that -- is that where you would like to see this against Trading Bay for production of stored gas through one of an order that Unocal would not in the future make a claim authority to do this, but that the Commission might condition i ( 1 2 3 4 5 6 7 8 9 10 11 12 ( 13 14 15 16 17 18 19 20 21 22 23 24 25 ( 36 ANCHORAGE, ALASKA 99501 810 N STREET (907)277-0572/Fax 274-8982 R & R C 0 U R T R E P 0 R T E R S all a normal gradient, pressure gradient. Creek unit as well as up onto Trading Bay oil & Gas leases is the statement made by Unocal that the area around the Pretty MR. OPSTAD: Okay. I said I just wanted to concur with sure I understand what you just said. CHAIRMAN NORMAN: Would you say that again, I want to be that's a normally pressure gradient in that whole area. that whole area I agree with the statement made by Unocal about the gradient. As far as I know based on experience in MR. OPSTAD: I just wanted to to respond to your question CHAIRMAN NORMAN: You may proceed. MR. OPSTAD: Sure, it's O-p-s-t-a-d. record, please? CHAIRMAN NORMAN: And could you spell you name for the 30 years. operated here in Alaska in the oil and gas industry for about Alaska. I have a Bachelors and a Masters in geology and I've MR. OPSTAD: Yes, sir. I'm a registered geologist here in someone having expertise in an area as an expert witness? CHAIRMAN NORMAN: And are you speaking from the basis of MR. OPSTAD: And I -- I..... CHAIRMAN NORMAN: Okay. MR. OPSTAD: Trading Bay oil & Gas, LLC. CHAIRMAN NORMAN: And who are you speaking for today? MR. OPSTAD: Erik Opstad. (:' 1\ (' 1 2 3 4 5 6 7 8 9 10 11 12 ( 13 14 15 16 17 18 19 20 21 22 23 24 25 ( 37 810 N STREET (907)277-0572/Fax 274-8982 ANCHORAGE, ALASKA 99501 R & R C 0 U R T R E P 0 R T E R S you foresee going wrong here if the neighbor -- your neighbor that that not impact you so in what ways might it? What could exceeds the normal pressure Mr. Craig has expressed a desire CHAIRMAN NORMAN: And if the storage injection rate the entire area to find anything that would be over-pressured. there's no reason based on the whole history of the drilling in wells in the area with -- with unusual pressure gradients so MR. OPSTAD: Because we haven't seen any really anomalous CHAIRMAN NORMAN: And upon what do you based that belief? MR. OPSTAD: Yes. CHAIRMAN NORMAN: But that's what you believe? MR. OPSTAD: .....there is it would be normally pressured. CHAIRMAN NORMAN: Sure. don't know, but if..... it hasn't been drilled, we MR. OPSTAD: If there is CHAIRMAN NORMAN: I know we don't know, it's..... MR. OPSTAD: If -- if the..... under the Trading Bay leases that..... underlying these leases there is gas under pressure right now CHAIRMAN NORMAN: So it is your belief as a geologist that something in that range. MR. OPSTAD: No, I mean something around .44 psi per foot, (simultaneous speech) ..... that there's even communication, is that what you mean CHAIRMAN NORMAN: And by normal pressure gradient you mean ( 1 2 3 4 5 6 7 8 9 10 11 12 ( 13 14 15 16 17 18 19 20 21 22 23 24 25 ( 38 810 N STREET (907)277-0572/Fax 274-8982 ANCHORAGE, ALASKA 99501 R & R C 0 U R T R E P 0 R T E R S CHAIRMAN NORMAN: Okay. And you use the word unlikely and Bay might wish to conduct in the future. particular impact, safety hazard on any operations that Trading which remain within the Pretty Creek unit would have no energy acreage and, therefore, over-pressuring in the sands storage are unlikely to be continuous onto the Trading Bay shows that the sands in question that are being used for which should be readily -- they should be able to provide that paraphrase for Paul a little bit, is just some sort of evidence But I think what Trading Bay was asking, if I could everybody and I think that's the only real potential hazard. over-pressured that could have a negative surprise for gradients and you penetrated a zone which was artificially weights that were designed to contain those normal pressure drilling a well assuming normal pressure gradients using mud could pose a drilling safety issue. If one were going in and pressures in the reservoirs essentially leak across and it One could encounter a situation where the elevated sands are discontinuous, although they probably are. guess any geologic evidence from Unocal to assure us that those Certainly Trading Bay doesn't. And I haven't seen any -- I sands -- maybe these sands are continuous, we don't know. MR. OPSTAD: If in the unlikely event that there were negatively impact Trading Bay, LLC? to the south over-pressures that reservoir how could that ( ( 1 2 3 4 5 6 7 8 9 10 11 12 ( 13 14 15 16 17 18 19 20 21 22 23 24 25 ( 39 ANCHORAGE, ALASKA 99501 810 N STREET (907)277-0572/Fax 274-8982 R & R C 0 U R T R E P 0 R T E R S Trading Bay oil & Gas' standpoint the request here is one of to happen. But I think that from Trading Bay Energy standpoint -- or depositional (ph) environment there one would not expect that somewhat of an unusual or atypical situation with regard to the throughout the area and -- and so and unless there's some -- rule the sands in question do tend to be somewhat discontinuous I use the word unlikely because as a general -- general from sources here which would show that. Bay hasn't provided me with any information that may have come I haven't seen that and at least Trading here, but I haven't within their current unit boundaries and there isn't an issue quite comfortable with the fact that those sands are contained in that area and it may well be that -- that Unocal itself is presented to Trading Bay in terms of the lay of the subsurface and you may have seen more information than what was MR. OPSTAD: I certainly -- I certainly do. I think the and Foerster may have a different view on..... information at least that I've seen and Commissioners Seamount you understand that there's no way to guarantee with the which would be that we could guarantee that that didn't, so do .....we've also used the word assurance CHAIRMAN NORMAN: MR. OPSTAD: Right. likely, less probable, but..... I think that may be a proper word here. It means it's less t ( 1 2 3 4 5 6 7 8 9 10 11 12 ( 13 14 15 16 17 18 19 20 21 22 23 24 25 ( 40 ANCHORAGE, ALASKA 99501 810 N STREET (907)277-0572/Fax 274-8982 R & R C 0 U R T R E paR T E R S COMMISSIONER SEAMOUNT: Okay. I guess I don't have any but. . . . . have to waffle on that one because I -- there could be, MR. OPSTAD: I -- using any -- the word any I think I'd Sterling sands, correct? COMMISSIONER SEAMOUNT: Including the thicker (ph) MR. OPSTAD: Over that distance, no. the area? sands in the Beluga, sterling section that are continuous to COMMISSIONER SEAMOUNT: Mr. Opstad, do you know of any CHAIRMAN NORMAN: Okay. Commissioner Seamount. MR. OPSTAD: You also do. interrupted) ..... possibility of abnormal pressures though (indiscernible - CHAIRMAN NORMAN: You always have to be alert to the drilling program. than -- other than normal pressures as part of designing a drilling operation to plan -- to have need to plan for other And also that there's some -- that there's no reason for a that we've come to some meeting of the minds maybe here today that where we all can say okay, no one is going to claim that gas is being drawn from -- from one site or the other. drilled, successful wells that do produce gas that there -- operations occur on that lease and there are wells that are setting someone -- or asking just that -- that if future ~. .( (' 1 2 3 4 5 6 7 8 9 10 11 12 ( 13 14 15 16 17 18 19 20 21 22 23 24 25 ( 41 ANCHORAGE, ALASKA 99501 810 N STREET (907)277-0572/Fax 274-8982 R & R C 0 U R T R E P 0 R T E R S ( 25 standing to request that. 24 adjacent landowners and lessees and Trading Bay certainly has 23 power granted you to conserve and protect the rights of 22 -- condition by the finding and I think that's well within your 21 leases will not be impacted by this reservoir or a conditional 18 Paul Craig is exactly what Trading Bay oil & Gas is asking. 19 And that is that the -- there either be a finding by the 20 Commission that the future development of Trading Bay oil & Gas 17 offer any testimony, but I would think that your question to 16 an attorney for Trading Bay oil & Gas and like Mr. Bond I don't MR. BANKSTON: Mr. Norman, my name is Bill Bankston. I'm 15 14 persons? CHAIRMAN NORMAN: Okay, thank you. Are there any other 13 ( MR. OPSTAD: Yes, sir. 12 11 you understand? 10 ask you to return to the microphone that you remain under Oath, CHAIRMAN NORMAN: .....and remember that if you -- we do 9 MR. OPSTAD: Sure. 8 7 finished..... 6 if you would likewise remain until these proceedings are CHAIRMAN NORMAN: All right. Thank you, Mr. Opstad, and 5 4 time (simultaneous speech) ..... COMMISSIONER FOERSTER: I don't have any questions at this 3 MR. OPSTAD: okay. 2 further questions at this time. Thank you. 1 ~:- 42 ANCHORAGE, ALASKA 99501 810 N STREET (907)277-0572/Fax 274-8982 R & R C 0 U R T R E P 0 R T E R S imperfect picture of what is there. unpredictable once you get underground. We have always an any adverse consequences. However, it is there are any points from this particular well. I would be very surprised if Trading Bay Energy's property is over a mile away at all range of a quarter mile, the spacing that you would expect. wells or other dispositions that might be within the normal thrust of all the regulations in asking about properties or sands are fairly isolated from the neighboring -- that is the order to give this storage injection permit at all, that the intention. I think the Commission has to make a finding in have to be carefully crafted in language. I understand the MR. BOND: I understand, Mr. Chairman. I think that would the concern that I'm hearing here. on their facility? That would certainly slice through a lot of your storage facility as long as they are at a legal location claim would be made against Trading Bay for producing gas from Would Unocal be willing to stipulate that in the future no don't have to answer it now, but it might short circuit this. Let me -- Mr. Bond, I'm going to pose a question. You impact a wider area than we think. intervene and put some sideboards on this if it -- if it did continuing jurisdiction and we could certainly at that point find that it is impacted I think the Commission retains CHAIRMAN NORMAN: Mr. Bankston, I could see that if we ( 1 2 3 4 5 6 7 8 9 10 11 12 ( 13 '\ 14 15 16 17 18 19 20 21 22 23 24 25 ( ,~ 43 ANCHORAGE, ALASKA 99501 810 N STREET (907)277-0572/Fax 274-8982 R & R C 0 U R T R E P 0 R T E R S testimony? Mr. Craig? Mr. Craig, you remain under oath, you Are there any other persons present that wish to offer 0015 Tape 2 (Tape change) 2700 Mr. Bankston, thank you. understand your answer. I just felt I would try to ask the question and see, but I CHAIRMAN NORMAN: Certainly and I understand that answer. that they have requested. necessary finding which I think then provides the protection commission to avoid that order if at all possible and make the if necessary to make that protection. I would ask the has more than adequate tools in a subsequent hearing or process correlative rights that need to be protected. The Commission There's no question that Trading Bay Oil & Gas has additional protection afforded at that time. back to the commission, make the report and there would be some more gas than we anticipate, we would expect that we would come make indicate a loss of pressure or that we're putting in much consequences. To the extent our reports which we are having to then protects Trading Bay oil & Gas from any adverse the finding that's required by the regulations and I think that I would be much more comfortable if the Commission made ( 1 2 3 4 5 6 7 8 9 10 11 12 ( 13 14 15 16 17 18 19 20 21 22 23 24 25 ( { 1 2 3 4 5 6 7 8 9 10 11 12 ( 13 14 15 16 17 18 19 20 21 22 23 24 25 ( understand? TESTIMONY BY PAUL CRAIG CONTINUED MR. CRAIG: Yes. And I just wanted to follow up with what I've just heard. And I am looking to the Commission, not to Unocal Trading Bay oil & Gas is looking to the commission, not to Unocal, to review the available data and to make sure that approval of this storage facility does not or is not anticipated to have any impact upon Trading Bay oil & Gas' operations. Trading Bay oil & Gas is in active negotiations with parties who have a interest in drilling this prospect and they will be they are and will be watching carefully what the commission does in this regard and it could have a very significant impact for Trading Bay oil & Gas in terms of securing a partner and/or funding for purposes of proceeding with this project. So I would just ask that the Commission review all of the available data and if it does not seem probable that it will have no impact on the Trading Bay leases, hopefully the commission would behave in a manner that protects Trading Bay's correlative rights. I see nothing to date that would suggest that Trading Bay's correlative rights will be impacted, but certainly the Commission has access to a broader data base than Trading Bay oil & Gas does. Thank you. CHAIR NORMAN: Are there any other persons present that R & R C 0 U R T R E P 0 R T E R S 810 N STREET (907)277-0572/Fax 274-8982 ANCHORAGE, ALASKA 99501 44 45 ANCHORAGE, ALASKA 99501 810 N STREET (907)277-0572/Fax 274-8982 R & R C 0 U R T R E P 0 R T E R S TESTIMONY OF JACK HARTZ have the responses and want to put those into the record? for the record to identify yourself and then to the extent you entered into the record. And Mr. Hartz may -- I ask you just did respond to each question and those responses should be were some questions directed to the applicant by Staff. Unocal Before we do that it did come to our attention that there questions. commissioners have conferred and have a few remaining application of Unocal for a storage injection order. record at approximately 10:30 to continue the hearing on the CHAIR NORMAN: We have recessed and we are back on the (On record - 10:30 a.m.) (Off record - 10:02 a.m.) record at 10:02. allow us to go over all of our notes. We'll recess, off the -- let's say we'll reconvene at approximately 10:15, just to around the corner, water, and we'll reconvene in approximately There are restrooms out in that direction, there is coffee wrap up fairly quickly. see if there are any final questions and then I think we can and during the break period the Commissioners can confer and efficient if we took perhaps a 10 minute break at this point We have 10:00 o'clock, and I think it would be most wish to offer any testimony? it , 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 ( ~ 1 2 3 4 5 6 7 8 9 10 11 12 ( 13 14 15 16 17 18 19 20 21 22 23 24 25 ( MR. HARTZ: Correct. I'm Jack Hartz, senior reservoir engineer on the Staff at the Alaska oil & Gas Conservation commission. As part of our evaluation of Unocal's application, there were several questions that were submitted to technical people at Unocal for consideration as part of the hearing process or part of the evaluation process. We submitted a series of questions, I believe there are about eight or nine regarding fracture gradients, pressure history, water production, water influx and trapping of gas as well as estimate -- or pressures from the various sands that are being considered as well as production history from the various sands that are being considered. Yesterday on the 9th of August, Mr. Smetanka from Unocal submitted an e-mail with answers to these questions, either qualitative answers where data didn't exist or quantitative answers where there was data, as well as a pressure history for the Pretty Creek unit #4 well. And I believe these questions and answers are pertinent to the discussion that the Commission will have regarding the storage injection order so I believe they should be entered into the record. CHAIR NORMAN: Mr. Hartz, I have here a -- it consists of one, two, three, three pages and an attached tabulation of -- in question and answer form and if you have a copy there to R & R C 0 U R T R E P 0 R T E R S 810 N STREET (907)277-0572/Fax 274-8982 ANCHORAGE, ALASKA 99501 46 47 810 N STREET (907)277-0572/Fax 274-8982 ANCHORAGE, ALASKA 99501 R & R C 0 U R T R E P 0 R T E R S anything and I think he would correct us. So I believe that CHAIR NORMAN: Knowing Mr. Havelock, if we misstated with us. subject to correction from Mr. Havelock who is with DNR and is MR. BOND: Yes, Mr. Chairman, that's my understanding owner to conduct the storage. having land tenure in the form of authorization from the land our order and that our order is conditioned upon the applicant or something like that. And we would anticipate noting that in going from memory for the moment, but as I recall there was a time table and it was projected that DNR might be ready to adjudicate on that by, I believe, it was the 9th of September State of Alaska and this commission doesn't address that. I'm record, is there is a storage lease agreement pending with the to the questions posed by the Staff for working this. Another matter that I did want to note simply for the you to authenticate that that was what you received in response CHAIR NORMAN: Okay. Thank you, Mr. Hartz, we just wanted print of that. with pressure data from Pretty Creek #4 which I don't have a questions, there's a fourth page which would be a spreadsheet MR. HARTZ: Yes, the three pages are answers to the (indiscernible) . part of the record of this -- these proceedings that's give to the court reporter, otherwise we can use mine to make ,( ~. (' 1 2 3 4 5 6 7 8 9 10 11 12 ( 13 14 15 16 17 18 19 20 21 22 23 24 25 ( ;J.r" ~ 1 2 3 4 5 6 7 8 9 10 11 12 ( 13 14 15 16 17 18 19 20 21 22 23 24 25 ( (' concludes those preliminary matters so let -- what I will do now is ask the Commissioners if there are any final questions of any of the witnesses that testified. I don't think that will be lengthy. And then we'll give any parties here and you, Mr. Bond, the final opportunity to summarize where we are, if you care to do so. And then I think we should be able to wrap up, I would estimate within certainly the next 30 minutes, perhaps less. commissioner Seamount, questions? COMMISSIONER SEAMOUNT: Yes. Mr. Smetanka, yesterday the Staff showed me a structure map of the Pretty Creek area that I assumed was submitted by Unocal and I was wrong, it was a map that's in our files. I think -- I guess my first question would be what does Unocal think the trapping mechanism is of Pretty Creek field? MR. SMETANKA: Well, I think I should get my geologist to. . . . . COMMISSIONER SEAMOUNT: And where is your geologist? MR. BOND: Mr. Chairman, if we could swear another witness we could get a more direct answer. Our engineer is giving out on us. CHAIR NORMAN: Can you raise your right hand, please? (Oath administered) MS. SHANNON: Yes, I do. TESTIMONY BY COLEEN SHANNON R & R C 0 U R T R E P 0 R T E R S 810 N STREET (907)277-0572/Fax 274-8982 ANCHORAGE, ALASKA 99501 48 49 ANCHORAGE, ALASKA 99501 810 N STREET (907)277-0572/Fax 274-8982 R & R C 0 U R T R E P 0 R T E R S be two answers to that. The first answer is I believe that MS. SHANNON: To answer the question, I guess, there could qualifications, please proceed. CHAIR NORMAN: without objection we will accept your geologist in the state of Texas. MS. SHANNON: I also am a registered professional CHAIR NORMAN: Very well. Inlet oil and gas properties. realm. I have been in Alaska now for two years, working Cook have worked only for Unocal, primarily in the international since 1984. I have a bachelor's and master's in geology and I not -- I'm sorry, not professional, I have worked for Unocal MS. SHANNON: I have been a professional geologist and -- background? CHAIR NORMAN: And, please, state your professional MS. SHANNON: I represent Unocal. CHAIR NORMAN: And, please, state who you're representing? MS. SHANNON: C-o-I-e-e-n. CHAIR NORMAN: Okay. And..... MS. SHANNON: Yes. CHAIR NORMAN: And the first is with a C? MS. SHANNON: S-h-a-n-n-o-n. CHAIR NORMAN: And would you spell that, please? MS. SHANNON: Coleen Shannon. CHAIR NORMAN: Please state your name for the record? ~, 1 2 3 4 5 6 7 8 9 10 11 12 ( 13 14 15 16 17 18 19 20 21 22 23 24 25 ( 50 ANCHORAGE, ALASKA 99501 810 N STREET (907)277-0572/Fax 274-8982 R & Reo U R T R E P 0 R T E R S data or information, but we would like to see what Unocal's What we would like to have in the record is not any raw confidentiality. certainly want to respect all proper assertions of Mr. Bond, and then we'll be happy to hear you further and we CHAIR NORMAN: I think what we're -- see if this helps, mind. commissioner desires to head, but just wanted to keep that in to the confidential, proprietary data. I don't know where the (indiscernible) else will verify, but we are now getting close MR. BOND: This is Mr. Bond. I think it is possible and injection zones, proposed injection zones? MS. SHANNON: No, they do not. COMMISSIONER SEAMOUNT: Would it be possible for Unocal to provide us with a structure map close to the top of the kind of four way closure on the field? trap gas in and around the Pretty Creek 4 well. COMMISSIONER SEAMOUNT: Do your interpretations show any how those faults are behaving, they could actually seal and been done, we have seen evidence for faults. Not understanding The other is in some of the recent seismic work that's trapping component. south to north which would sort of incorporate a stratigraphic sands begin to become more silty and shaly as you move from there could be a stratigraphic trap in that I believe that the f & ( 1 2 3 4 5 6 7 8 9 10 11 12 ( 13 14 15 16 17 18 19 20 21 22 23 24 25 ( 51 ANCHORAGE, ALASKA 99501 810 N STREET (907)277-0572/Fax 274-8982 R & R C 0 U R T R E P 0 R T E R S focus of this map? We are interested simply in this zone of public record. Would it be possible to perhaps narrow the into this hearing it would, it's going to be -- enter the CHAIR NORMAN: I think we have to say that once it's put result then we'd prefer to have a finding of confidentiality. public generally. If showing it on the screen would make that to find its way into the public record and be available to the Let me say this, I would not want a hard copy map of this course, is both proprietary and confidential. data which is itself confidential and the interpretation, of MR. BOND: The map, of course, is an interpretation of map itself? CHAIR NORMAN: Are you asserting confidentially over the we are correct in asserting a confidentiality request for it? materials and then you could make a determination as to whether be good if we could show the Commission itself initially these want to belabor this point, Mr. Chairman, but perhaps it would MR. BOND: All right. Jeff, can you help us? I don't CHAIR NORMAN: We would like to see it. like to see it. MR. BOND: We're prepared to show such a map here if you'd the particular receiving reservoir. suffice in the form of simply a contour map showing us that -- containing reservoir would look like. And I think that would picture -- interpretation of this receiving reservoir, the " 1 2 3 4 5 6 7 8 9 10 11 12 ( 13 14 15 16 17 18 19 20 21 22 23 24 25 ( { { 1 the receiving reservoir and to the extent that there are 2 contours extending out from that, we'd just like to know what 3 your picture of this. 5 MR. BOND: Okay. CHAIR NORMAN: And I also think there is feeling by the 4 6 Commission that in fairness to the public and adjacent property 7 owners, they need to know that also in order to be able to 8 meaningfully respond to this. So if you don't want to put the 9 map on now, we would leave the record open and you can prepare 10 a map to tailor it down to meet specifically this application. 11 MR. BOND: Okay. Could we just confer for a minute,..... 12 CHAIR NORMAN: Sure. ( 13 MR. BOND: .....and look at what we got? 14 CHAIR NORMAN: Sure. We'll go off the record for a 15 moment, please. 16 (Off record - 10:43 a.m.) 17 (On record - 10:45 a.m.) 18 TESTIMONY OF COLEEN SHANNON CONTINUED 19 MS. SHANNON: What this shows is what we believe to be the 20 extent of the 45-0 and 51-5 sands in the vicinity of the wells 21 in the Pretty Creek unit. The orange color would be the 51-5 22 and the magenta color would be the 45-0 sands. And those are 23 the extents. Now this not specifically a structure map, but it 24 gives you a sense for what we do believe the extent is of these 25 sands. ( R & R C 0 U R T R E P 0 R T E R S 810 N STREET (907)277-0572/Fax 274-8982 ANCHORAGE, ALASKA 99501 52 53 ANCHORAGE, ALASKA 99501 810 N STREET (907)277-0572/Fax 274-8982 R & R C 0 U R T R E P 0 R T E R S MS. SHANNON: Not gas/water context, lowest known gas. of gas/water context and stratigraphy, correct? COMMISSIONER SEAMOUNT: So it's based on an approximation that on each -- at the top of each of the sand maps. known gas level defined by Pretty Creek 4 and a structure map sands. Assuming that you have a single net sand map, a lowest the extent of a boundary around the two cases for each of the two cases and what -- and that's what you're seeing here, is contour interval, 50 feet down, and drew a boundary around the mapped that sands in both cases and then went to the next we mapped out net sand above a lowest known gas level and stratigraphic only component to the trap. So what we did was associated with the trap and two, where there was a cases in each way, one where there was a structural component took an approach where we looked at a number of cases, two MS. SHANNON: There's -- let me just go in and say that we understand what it is? COMMISSIONER FORRESTER: Well, could you help me MS. SHANNON: Yes, I do. It's neither. extent? Do you understand what I'm..... COMMISSIONER FORRESTER: Of the sand extent, not the pay aerial size of what we think these are. MS. SHANNON: This is just strictly showing on a plat an gross sand map, a net pay map, what would..... COMMISSIONER FORRESTER: Would that be a net sand map, a I( {, 1 2 3 4 5 6 7 8 9 10 11 12 ( 13 14 15 16 17 18 19 20 21 22 23 24 25 ( 54 ANCHORAGE, ALASKA 99501 810 N STREET (907)277-0572/Fax 274-8982 R & R C 0 U R T R E P 0 R T E R S ( 25 The. . . . . 24 boundary. The storage area itself is not described on here. 23 side of the X dash X boundary in this case, which is the unit MS. SHANNON: Okay. The leases are on the north and east 22 21 have to respond verbally. MR. BOND: Remember to the Commissioner's question you 20 MS. SHANNON: Oh, I'm sorry. 19 MR. BOND: Was the answer yes, Coleen, you have to talk? 18 17 COURT REPORTER: I didn't hear the response. 16 any more questions. Thank you, Ms. Shannon. COMMISSIONER SEAMOUNT: Okay. Thank you. I don't have 15 (Inaudible response) MS. SHANNON: 14 COMMISSIONER SEAMOUNT: Okay. And am I correct in saying that the Trading Bay leases are on the north edge and the east edge of the map? 13 ( 12 11 MS. SHANNON: Yes, we have. 10 9 the gas that's been produced and will be stored? 8 figure out if that's a reasonable container, it can hold all 7 any estimations, you know, back calculating volumetrics to COMMISSIONER SEAMOUNT: Okay. So this -- has Unocal done 6 5 and the lowest completion depth. 4 (ph) interval and Pretty Creek 4. The two sands were competed MS. SHANNON: Just the lowest known gas from completion 3 2 lowest known gas estimated? COMMISSIONER SEAMOUNT: Lowest known gas? And how is 1 ( 55 ANCHORAGE, ALASKA 99501 810 N STREET (907)277-0572/Fax 274-8982 R & R C 0 U R T R E P 0 R T E R S container size once you've achieved that or no? percent over original gas, does this map represent the COMMISSIONER FORRESTER: If you're expecting to inject 40 COMMISSIONER SEAMOUNT: Thank you. in place that we had calculated. balance work. Those volumes are -- represent the original gas that we calculated through volumetrics and through our material MR. SMETANKA: That represents the original gas in place BCF, is that correct, as colors? COMMISSIONER SEAMOUNT: And that represents more than 2.7 MR. SMETANKA: That's correct. COMMISSIONER SEAMOUNT: 2.7 BCF? MR. SMETANKA: 2.7. produced, was it 7 BCF? COMMISSIONER SEAMOUNT: Okay. And how much gas has been understanding is the gas storage area as we see it. that includes a buffer and quarter sections. But this to my as we see it. We've gone to the DNR to lease a larger area the DNR is larger than this volume. This is the storage area leased area that we're -- the area we're trying to lease from MR. SMETANKA: I think what Coleen is referring to is the COMMISSIONER SEAMOUNT: Is it larger by 40 percent? MS. SHANNON: The storage area is larger. or smaller? COMMISSIONER SEAMOUNT: Would the storage area be larger ,I' , ( 1 2 3 4 5 6 7 8 9 10 11 12 ( 13 14 15 16 17 18 19 20 21 22 23 24 25 ( 1 \ 2 3 4 5 6 7 8 9 10 11 12 13 14 ( 15 16 17 18 19 20 21 22 23 24 25 ( ~ MR. SMETANKA: It depends. If -- we think we're dealing with a volumetric reservoir and 51-5 sand, if that's the case as we put in 40 percent more volume, the area is not going to get bigger, the pressure's just going to go higher. And we should be able to tell that as we reach that point that we go over the normal pressure. But if, in fact, the reservoir's larger than that then yes, the area would grow some. I don't have another map to show that. COMMISSIONER FORRESTER: Okay. CHAIR NORMAN: So, Mr. Smetanka, so I understand then, the orange or tan orange is superimposed on top of the magenta boundary there and that depicts the geographic limits of what you expect the reservoir to be, is that correct? MR. SMETANKA: That's correct. CHAIR NORMAN: And the magenta -- incidently, magenta comes from the battle of Magenta, Italy where blood was strewn allover and the entire area of the battlefield was the color of dried blood and that's how we use the term magenta. Footnote for the court reporter. But the magenta is your expected container and if gas moves out of that area then that is moving into an area that you are not anticipating it to be nor would the Commission, is that right? MS. SHANNON: Right. CHAIR NORMAN: Okay. So we have a geographic boundary and R & R C 0 U R T R E P 0 R T E R S 810 N STREET (907)277-0572/Fax 274-8982 ANCHORAGE, ALASKA 99501 56 57 ANCHORAGE, ALASKA 99501 810 N STREET (907)277-0572/Fax 274-8982 R & R C 0 U R T R E P 0 R T E R S color. CHAIR NORMAN: Let's see, I think we understand then and this particular map will be -- I think we understand this COMMISSIONER SEAMOUNT: It's also T. K. Whitney's (ph) Phoenicia. CHAIR NORMAN: Purple is the royal color of the palace at COMMISSIONER SEAMOUNT: Yeah, where'd purple come from? purple, John? COMMISSIONER SEAMOUNT: That looks purple to me. COMMISSIONER FORRESTER: What's the origin of the word MS. SHANNON: .....oranges below are 51-5. Okay. MS. SHANNON: Yeah, and the..... COMMISSIONER FORRESTER: .....and the orange is below? the. . . . . COMMISSIONER FORRESTER: The magenta is the upper and MS. SHANNON: .....45-0. COMMISSIONER FORRESTER: Okay. MS. SHANNON: No, I believe the magenta is the upper..... boundary? intervals aerial boundary and the magenta was the lower sands on this. I thought that the tannish orange was the upper boundary is at this point well south of the Trading Bay Leases? COMMISSIONER FORRESTER: Let me ask a clarifying question that is -- again since we are talking for the record, that Ilf f .~ 1 2 3 4 5 6 7 8 9 10 11 12 13 ( 14 15 16 17 18 19 20 21 22 23 24 25 ( 58 ANCHORAGE, ALASKA 99501 810 N STREET (907)277-0572/Fax 274-8982 R & Reo U R T R E P 0 R T E R S ( 24 the record will remain open for a period of one week from today 25 for you to submit it. 23 persons that wish to submit something for the record, likewise 22 week and receive that information and if there are any other CHAIR NORMAN: Yes, we will hold the record open for one 21 20 as well? 19 copies of our slides that were presented earlier and this slide MR. BOND: .....remain open so that it can receive the 18 CHAIR NORMAN: Please. 17 16 record..... MR. BOND: Mr. Chairman, could I just ask that the 15 COMMISSIONER FORRESTER: Nor do I. 14 ( CHAIR NORMAN: Commissioner Forrester? 13 COMMISSIONER SEAMOUNT: I have no further questions. 12 CHAIR NORMAN: All right. Good. Commissioner Seamount? 11 MS. SHANNON: Yes. 10 CHAIR NORMAN: .....correct? 9 MS. SHANNON: Exactly. 8 7 according to plan,..... 6 outside that boundary, then we know that this has not gone 5 and there's a showing that stored gas is appearing somewhere 4 reservoir. And if at some future date we all were to reconvene 3 this is the approximate geographic boundary of the receiving 2 is the lower interval and the magenta is the upper interval and depicts the top of each of the receiving sands and the orange 1 ]" ( I{ " { 59 810 N STREET (907)277-0572/Fax 274-8982 ANCHORAGE, ALASKA 99501 R & R C 0 U R T R E P 0 R T E R S ( 25 24 23 22 21 20 19 18 0843 17 (Recessed - 10:55 a.m.) 16 10:55 a.m. 15 no objection by the Commissioners we will stand adjourned at no persons asking to be recognized and accordingly if there are 14 Okay. The Chair would note for the record that there are 13 ( excused. If you could remain for just a moment, and I'll ask if there are any other persons present in these proceeding who have any testimony that they wish to offer? 12 11 10 CHAIR NORMAN: All right. Thank you. Then you're 9 8 approval in the course? 7 would ask the Commission give it its due consideration and 6 elements required by the regulation respecting storage and MR. BOND: Yeah, I believe that we have presented all the 5 4 it's been a good presentation, I believe we understand it. 3 You need not do a summation, but if you care to do so. I think And Mr. Bond, I'll first ask is there anything finally? 2 Thank you very much then for your testimony. 1 (" ( ANCHORAGE, ALASKA 99501 810 N STREET (907)277-0572/Fax 274-8982 R & R C 0 U R T R E P 0 R T E R S ( 25 24 23 22 21 20 19 18 17 16 15 14 ~()~~~~ Notary Public in and for Alaska My Commission Expires:10/10/06 13 ( 12 IN WITNESS WHEREOF, I have hereunto set my hand and 11 affixed my seal this 12th day of August, 2005. 10 THAT this Public Hearing, as heretofore annexed, is a true 9 and correct transcription of the proceedings taken and transcribed by Suzan Olson and Lynn Hall. 8 6 THAT the annexed and foregoing Public Hearing held on August 10th, 2005 was taken by Suzan K. Olson, commencing at 7 the hour of 9:00 o'clock a.m, at the Alaska oil and Gas Conservation commission of Alaska in Anchorage, Alaska; 4 I, Rebecca Nelms, Notary Public in and for the state of Alaska, residing at Anchorage, Alaska, and Reporter for R & R 5 Court Reporters, Inc., do hereby certify: 2 UNITED STATES OF AMERICA ) )ss. 3 STATE OF ALASKA ) C E R T I F I CAT E 1 ,{ \, ~:' ~: -.c.-.~~~ 8. ., O. '05 Application for Storage Order for Pretty Creek --~ Overview · Unoca is recuesting a storage oreer ':or -¡;;...~ t 1e :>retty Cree < area to 1e·J meet utiity gas mar<et eemanes in t1e Coo< n et · Storage eeivera Ji ity 1e ps ensure Jea < winter gas eemane is met ':or t 1e Anc 10rage area -~~ · L noca 1as met a t 1e AOGCC requirements ':or storage app ication Application Requirements AOGCC ~egu ations 20 AAC 25.252 'c' An aJJication ':or ~ ~ uncergrounc cisposa or storage must . Inc uce: ~ P a~ · A )at s 10wing t1e ocation 0-= a . )ro :Josee storage we s, a )aneonee or ot1er unusee we s, Jroeuction we s, cry 10 es, ane any ot1er we s wit1in one-cuarter mie 0-= eaC1 )ro:Josee storage we 5 4 .3 5 "l 3 ~ ~ ~ ~ (7) CJ) (7) CJ) oÞ tÞ oÞ tÞ ...,:¡ I I I -.] ...,:¡ I I I -.] ::I~. 000 ::142.090 3471~Ø 3~. 00Ø 342.090 ::Ii71~0 51 Ð 51 ~ IS) = IS) = 1 ~rHJ(} 1 :6000 'EEr~(}nET fEET ~ 10ØD 2ÐpD FEET = G\ (5) ~ (7) (n N _ IS) ~ Œ\ = G\ (5) r;-'....",=---- ~ CJ) U1 _N ~ CJ) U1 _N ~ (7) (n N _ IS) ~ Œ\ 34 33 \ ;:12 34 33 32 PCU 2 -818' Quarter mile radius arounp 45-0 penetration in PCU-4 well -"55Ô~CU 2 Quarter mile radius around 51-5 penetrati9n in PCU-4 well (5) G\ (5) Œ\ ~ Œ\ (5) G\ (5) Œ\ ~ Œ\ N m U1 _-.:I -8191 + N m (n ~ - N m U1 _-.:I -361pCU 224-28 + N m (n ~ - 27 2B pcu 2.24-28 29 27 28 29 347d5iØ No 342.080 3ai. øøø N N 347.äø N 342.13013 a~. 0Øø N œ ~ œ (5) G\ SI œ- ~ œ (5) G\ SI PCU #4 Location Map, 45-0 Sand ~ {Depth values in TVDSS} ~ PCU #4 Location Map, 51-5 Sand ~ (Depth values in rvDSS) · A ist 0'= a operators anc surace owners wit1in a one-cuarter mi e racius 0'= eaC1 :>ro:>osec storage we - Unocal - State of Alaska Department of Natural Resources 'DNR' .. j Lis: 0': Opera:ors/Surace Owners ..-. -- · Affidavit showing that the operators and surface owners within a one-quarter mile radius have been provided a copy of the application for storage · Provided copy to - State of Alaska Department of Natural Resources (DNR) · A courtesy copy of storage application was provided to Mr. Francis H. Grant, due to the proximity of his land to the storage area :within Unit, % mile from well' ~ Notification /-, - · 5~ -5 sanc_ - Beluga formation - Sand top in PCU #4 at 5144' MD, -3585' SS - Thickness = 20' - Lies under interbedded siltstone, mudstone '10' MD~ ,. ~ - Overlies PC4 coal '21' MD~ ~ ~ Storage Formations ~.. r- ~ ~ ....r-. ~ ____ ~_-L~~_~ .~. .... - ~--.... ......._-----_._--~------ ~ .- -- ~.: ~ ' RHOB 7·65 lL&~ HIli:! lNPH IJ ) 3Ø0'.e.~ ~ $' , , , ,¡ ,¡ I : 51~~ $anc- I < f ( i n~ ' ,;' ' : ;:: t ~; .~ RU P5R e-. e- _ 0 '""J 0 II'J '.'" k') I O· 15- 111· J. g ~f¡p 'W) . 11). ~. e-. e- e- - ~ II'J.~ . If} JoI} . O· g- "'II. g~ 9.1 r yf t 9~i1p' rx:~ Z S S .e- . "'II '""J . , .~ t rr~ : « ~ ~. t .~' : ¡ ¡ .. 4 ~ ~ ~ &R_(DR GR_JNÞ PCU-4 Well Log Showing 51-5 Sand PC:~o~ I i ~ 1 - .~ T · . . · . . 1 ; ~ · . . · . - · . . ~1-r R ¡ I PC4(':qf'1 '~~I P~IL nn. ~ Q · 45-0 sane - Sterling formation - Sand top in PCU #4 at 4503' MD, -3185' SS - Thickness = 9' - Lies under coal '36' MD~ , ~ - Overlies coal '33' MD' , ~ Storage Formations - "- ~~I J e-~II:! lL&~ -~~~-~-- ! '___,_n i I 7.6& ~___n.__ - ! 'r._-~_.mmrn.....! mn ,}_ ~ lNPH RHOB ~. ~ê I 0/1":"<:' I -i ; .;0' ... ~~-'~_._n_n__~.~.~;;::~_'\ _ >yc'-f+, _ ¡ Ii .. :--r-¡ f~~'~--~ j gl 45l1SfdÌJd c-~~ . ~--. l,. I¡"IoJ 1· . "( I ~ J - I : 1'\'3 l on ~¡ Ii .... : L "L I I I i , "'---'- .;0 ~,t""I o -..-;t ... - ..-;t ..,. , o ~- "'II o· ~- ..... I;' I;' - .... ..., , O· ~- "'II. 9>3 r ~f t g~i1p.rx:ftZ SS ~ ~-~- ... 3~~P.e- r- i -~ pr 1 ":orl ---. RlI! 300' .H· P5R ,.-, _. . · I·V .. ,'_~ I ~~.. ...... - ! &R_(DR g~ ~ GR_JNP PCU-4 Well Log Showing 45-0 Sand -, · A open 10 e ogs '=rom we s in t1e 'Jretty Cree < Unit were sent to t1e AOGCC once t1e ogs were com'J etec. .- Logs · The PCU #4 well will be tested for mechanical integrity using the standard 30 minute annulus test per 20 AAC 25.412. · Unocal will monitor daily injection rates and pressures and notify the AOGCC the next working day if the rates and pressures indicate communication or leakage · Rate and pressure data will be reported to the AOGCC on a monthly basis -'~- Mechanical Integrity c Schemati on / nformati Casing Pretiy Cmek Well No.4 Actual 05.Ð5104 l!iI~¡BJ~ UNOCAL<. CMIN(; AlID TUBIN(; D!:TAIL !mït~---W1'-----¡-~ i CXt6E" ¡ --u,- ,'1'0:£, :e:m. I I 1~.J,z" :. ' . I su,r.17: I ;os' tæ¡ -~-;~-----!:~~-t~==f~-=;;i~:~ :~~¡ I J ,- ,IT'i,'!ILIo 'I DETAIL ~i~'~'T--:œ--"r~---T 1-'------ i i i j J'l'oductÏo)n Tut.~Innt>rltri1f J~I'7 íf!Ji!t~Ït}~~ji';-----.·- --vr-r----J}7r-¡--y.nrr----rr;-r- }.:.i.I~~iiw .- - ~----F~=-F==-~-+~=-=--l ~1§~U4~~-.·.· --. -T~t=~~~F~4~~~if~f··ll..: =lfj!~~:~l;:~~i~:~:;::..WoiH~- ¡ ¡ ,,,'!.ow ----~---~!~----~~;-~-~-;-~~~-~-- - -- - - --- - -~l=¡_iIT=.t~===t:==~~·i~~:~~i~....._._ _ C..IU~.:B PI:Rl"ORA'IT OR HB TOR.Y ..~...... hmm. To¡. BUn. .t\mt. fIf 4.5(17' 4.514' ----=¡¡- 12 5.H2' 5.172', 20' 12 5.5(;(;' 5.517'''' 11' 12 lØí.e StorU/u" :f;t>Þ~. :f;t>b~_ Date U'l412.Q(U JlIl.7/.10JI} lln4mu - A ¡'~l= .l.~~ 1-' I 'q <I------ n ¡ r ; ~ ~~ f~~:.~ m ~ ~~IV ~~v ~I~~ / :5 ti ? I: 2 3 ... Tig}-.t. spot:in. b.ibÏng i'J1 ~ 1150' WLM (4/11103 ) .-' <11910<1 Op%l. dHM G:bnd _<1130103 Op%l. op~ Op%l. SL][)Iß.GS ¡.mn: BD TO];tY ~ S~th . 5r'<1nO JI~:\'121m92 J J21 ..I:>,~"a O}Cr%I. J 1]3 ~~~. oP.%I. . J J7 , ..I:>n,a ..I:> ~M TD = !JI,:5Ð2'MDn,ti(J(J'1VD ,¿ ~ !JI Storage Fluid -98°/Ó methane Unocal Gas Analysis Report -Sourced rfrom own Location: Steelhead GGS (6105 meter) . production or purchase I Facility ID: TBPF 6105 Analysis Date: 12/6/04 exchange: from Steel head Btu/Cf: 1003.235 Gravity: 0.568105 GGS rMcArthur River CO2 0.30862 ~ Field:, Beluga River Field, N2 1.45155 Methane 97.87396 ~. Ethane 0.16970 Propane 0.06731 or properties on the West Ibutane 0.01331 Nbutane 0.03390 NeoPentane Side of Cook Inlet Ipentane Npentane - C6+ 0.08165 100.00000 -Estimated max injection rate of 20 mmcfd ~. · -1e estimatec average in.·ection 'Jressure wi Je' 550 'Jsig · -1e maximum injection pressure wi Je 2500 psig Injection Pressure · We 1eac in·ection :>ressures wi .3e . maintainec SUC1 t1at a gracient 0'= 0.65 :>si, ''=t at t 1e target mic :>oint 0'= :>erorations c e:>t1 0'= 3686' -, ,0:J '5' -5 sanc' is not ~ ~ exceec ec. · _ea <0'='= test c ata '=rom :>CU ~4 incicates '=racture grac ient 0'= 0.99 psi, ''=t at 1977' -, ,0:J anc 0.82 :>si, ''=t at 5' 04' -, ,0:J Fracture Information ~ -. - 5/26/05 9,856 mg/I TDS · Representative of 51-5 sand ,.- · Twoa.Joratory ana yses 0'= producec wa:er sam:> es '=rom t1e ~CU ~4 we were co ectec: - 5/17/04 22,459 mg/I TDS · Representative of 45-0 sand _0 Water Analysis · Well was drilled and completed in November 2001 · Casing cemented according to 20 AAC 25.252(b), tested in accordance with 20 AAC 25.030(g) · 7" casing cemented with full returns to surface · Subsequent cement bond log showed good bond from 6918 to 5900' · Perforated and circulated cement from 5594' to surface with 12 bbls return at surface - full returns · Full zonal isolation believed to be present due to successful water shut off with closing sliding sleeves, and straight line trend in P/Z plot of 51-5 sand Mechanical Condition ~, .- · -=>retty Cree < represents an important gas storage '=aci ity '=or t1e Coo< net mar<et · -1is a:>p ication meets a AOGCC rec uirements '=or storage in.·ection orcer · Unoca requests prompt approva 0'= t1is app ication so t 1at storage operations can . .Jegln Summary ,"- ,- I: ~. §" ~~ g. ~- ~. [.~ ~~ æ· §. ¡~ ) 33M I) (I :34.(11)00344000 . I . . . . I . . . . I . . . . I . . . . I . ) 34'WOC1 . I . . . . I I u .)( .. U U .. X .1 Pretty Creek ~ '!!t: ^pr~~!.~ ..:~~x ~~!.? (~::a~4 X I X / X J X >rx-x/ I X x-x'-~ :/ )( I M I X I X il )( , )( I )( I: X I X j f .·".m¡,.1""····,,", )( t X I X J )( . X t )( If x \ +U' )( .1 n~.- u t U )t II Pretty Creek Unit Boundary .",,",._iiJii'llìi¡¡¡¡:'¡ !, I . )( .¡ -tf U U - - - .~ - -- ~! .... - - - - - - , :' . w - ~~ - - .§ - - - .... ... - rX-·)(.:-' )( I, x M tt I - - :: .... ~ - - .~ ~~ - - W' .... )f .N¡ ð'> I -~ )( I '0 x / x .1 " PCU-01 . .) HNO »XI 3000 4')00 SO·) on ~ I I I I 1 :3')<»:) . I . 336-.).).:) . . . I . . . I . . . ~I·)OO . . . I . . . ).Woo:) . I . 34Q.(1OO .~ ~I . I ) ) STATE OF ALASKA OIL AND GAS CONSERV A TION COMMISSION Pretty Creek Gas Storage Injection Hearing August 10, 2005 9:00 AM NAME - AFFILIATION ADDRESS/PHONE NUMBER TESTIFY (Yes or No) (PLEASE PRINT) WILL! /lét.-¡ )/1 '73A¡V/é J:T6,---J &¿7) C-u'. ~-jL"" <7&ð;> 2 /0-1) /; /U//-7/fr SAwH/l Et- It TìA-"" 'OAt- LW A 1.--\ (lð tEEN ~ H-A-J r1 oti Ho..rG ~'()l1.{J -!e-CcÇ SMd-~ ~/l {'/C1f~. 1; ~ \--\CÅ~~~!- ~(l.ltVJ ~8.0 ~ Ef2(lé ¿k.f1n-jJ ...(.; ., ð Cf \;j' cfTH !tw¿H '2-- b') --:::ri .6 4 'l D 0; ".J. 1!~ ft( ¿r;;:¡ /9 /; b qoCl ¿J " 9 ¿ I!Jr€ 2& ~ "'78( 'S ,\. ¿,k ~ ('6'L'ê. --l (- l05 51 ß L£ CD t.J/7$f?l +'~ L/~'7 (,j C 0_ ( '--( e~ 5"132 t:. /l.7fiC/~ I )kG 278'-7l(JY1 Yö. f-\O~Cc.... ~<;š-\)-S-ù ~'t\)~ 1\DNR 'bD~& 2~~"i?8ùì ~~~~"hN~ ßJ.ß¡, /?¿J?5-St ,S~--~\~3t/'V ßð #21 L'U.::..·/F !Cuy \.AI;;íC;J.\. ùLV ~JJl1~aL!VH ) ) A ,( __/¿ /D'( -- /( Subject: RE: Pretty Creek S10 Application From: "Smetanka, JeffW" <smetankaj@unoca1.com> Date: Tue, 09 Aug 2005 16: 10:02 -0800 To: "Hartz, Jolm D -AOGCC" <jack_hartz@admin.state.ak.us>, JeffSmetanka <smetankaj@unoca1.com>, Stephen F Davies <steve_davies@admin.state,ak,us>, Thomas E Maunder <tom _ maunder@admin.state.ak. us> CC: "Shannon, Coleen C," <cshannon@unoca1.com>, "Darkwah, Samuel A" <darkwahs@unocal.com> Jack, Attached is a Word document containing the answers to your questions. Also attached is a spreadsheet containing the pressure data. Hopefully, you will find this information helpful and responsive to your questions. We had hoped to get this information to you sooner but encountered some difficulties. Please let me know if you have any questions on this. Thanks, Jeff 263-7622 From: Hartz, John D -AOGCC Sent: Tuesday, June 28, 20054:00 PM To: Jeff Smetanka; Stephen F Davies; Thomas E Maunder Subject: Pretty Creek S10 Application Jeff, I have some questions and comments regarding the Pretty Creek Storage Application. Section 7: · Are there any estimates of frac gradient for the over and under lying confining intervals for the Beluga 51-5 and the Sterling 45-0 sands? · How do the coal, mudstone, siltstone, claystone estimated frac gradients compare to the Beluga , and Sterling sands? ' · Have frac gradients been calculated for the sands based on log properties? Section G: · Please tabulate the pressure history for the well so it is clear what initial pressure was, when pressures were measured and what the individual zone status was when each pressure was taken. · Water production appears to have killed the 45-0 sand. What is the estimate of remaining "reserves" or resources in the 45-0 sand? · Water could be a major consideration in the storage project. What steps are or will be taken to prevent water from cross flowing into the storage sand? · Is there risk that gas could be trapped by water influx or by water cross flow? · When plotting the PCU 2 and PCU 4 production history and p/z (based on pressures we have in our files) it almost appears they are connected to the same reservoir. Is there a possibility they 1 of2 8/10/2005 8:48 AM .I ..- -.... -- - - _£"£"___'__u__. ) that #2 an #4 are completed in some of the same intervals? Section J: . As in the question in Section G, it will be helpful to give the estimates of production from the 45-0, 51-5 and 56-5 sands at the dates pressure was measured in PCU 4. This additional infonnation should be provided before the hearing, Thanks, Call me (793-1232) if you have any questions. Regards, Jack Hartz, P .E, Sr. Reservoir Engineer Alaska Oil & Gas Conservation Commission 333 W 7th Ave, Suite 100 Anchorage AK 99501 907 -793-1232 Fax: 907-276-7542 . . . Response to Jack Hartz Content-DescriptIon. AOGCC,doc Response to Jack Hartz AOGCC.doc Content-Type: Content-Encoding: application/msword base64 Content-Description: pc4""'pressure _ data.xls pc4 -pressure _ data.xls Content-Type: application/vnd.ms-excel Content-Encoding: base64 20f2 8/10/2005 8:48 AM ) ) 1. Are there any estimates of ftac gradient for the over and under lying confining intervals for the Beluga 51-5 and the Sterling 45-0 sands? Fracture gradients/or the confining intervals around the Beluga 5 j -5 and Sterling 45-0 sands' in PCU#4 have not been measured directly. Specific leak-ofltest (LOT) data is not available and no core was acquired in these intervals 1,vhile drilling. 2. How do the coal, mudstone, siltstone, claystone estimated ftac gradients compare to the Beluga and Sterling sands? One ¡neasure ofa rock's strength is Poisson's Ratio. Poisson 's Ratios are lower for higher quality sandstones. Poisson's Ratios are higher/or silts. shales, shaly sands,tones and coals. These rocks are more elastic and are harder to fracture. Coals willlike~v be the upper and 10H/er barrier to the height ofa fracture in both the 45-0 and 51-5 sands. 3. Have frac gradients been calculated for the sands based on log properties? Yes. }ve have performed initial calculations offi'ac gradients based on log properties. Initial results suggest thatfrac gradients are betvveen 0.68 and O. 72 psi~ftfòr the 45-0 sand and bet'vveen O. 77 and O. 79 psVfi in the 51-5 sand. Note that the measured leak off tests (LOT'5) are sign{fìcantly higher than the log e,I:,'timatedvalues. rVe believe this discrepancy may be due to the availabili~F of log data and quali~v ofsarne and possibly an inadequate understanding of the mineralogy. [)ue to the lack (?ldipole sonic and core data. analog data from other South ,Kenai Beluga formations was z",sed. 4. Please tabulate the pressure history for the well so it is clear what initial pressure was, when pressures were measured and what the individual zone status was when each pressure was taken, See attached '~1Jreadsheet entitled ¡'pc4,jJressure.....data.xls". 5. Water production appears to have killed the 45-0 sand. What is the estimate of remaining "reserves" or resources in the 45-0 sand? liVe believe that there are no renulining gas resenles in the 45-0 sand. The production histoFJ! of the )vell indicates that the increasing lvater productionfronl the well in April 2004 was from the 45-0 sand. Attempts to flolv that zone both in combination 1vith [he 51-5 sand and in isolation vvere unsucces,~ful due to .."vater production. i4s a result, 'we feel that no additional gas will be recovered from the interval. 6. Water could be a major consideration in the storage project. What steps are or will be taken to prevent water ftom cross flowing into the storage sand? ~Vater is definitely a major consideraÜon in our gas storage project. In general, ourfirst preference for gas storage reservoirs are depleted gas reservoirs that exhibit volumetric ) ) behavior (i.e. no lvater Ù?flux). These reservoirs should pres en t fm'ver production problenzs such as surface 'water handling and ·wellloading. Fortunate~)), the PCU #4 vvell is completed H'Üh multžple packers and an inner tubing string (inside the gravel pack screens) 1A.¡,ith sliding sleeves, vvhich enable us to open or close individual zones with slick-line tools. This enables us to ¡nechanically isolate any of the three existing cOlnpletions. This ¡nechanical isolation has proven to be effective as Ï've were able to shut oilthe vvater production /i"'om the 45-0 sand and deplete the 5]-5 sand in isolation. One of the primal)? steps lve intend to take in this ga,s storage project is to initial~v conduct gas storage in the 5]-5 sand only, leaving the 45-0 zone closed in. At somepoint žn the jÌlture, we ¡nay decide to test gas storage in the 45-0 zone, but it is unlikely that this initial testing vvould occur while the 51-5 zone is qpen. ,If a test such as this is conducted and is succes.~ful, there may be some periods vvhere both zones are open for storage operations. Production tests and daily production Ù?lòrmation (rates and tubing pressure,s~would be utilized along with any additional required tests to rninimize the loss (?l Unocal 's gas in storage. 7. Is there risk that gas could be trapped by water influx or by water cross flow? Gas storage conducted in the 45-{) sand entails SOl7Je risk in trapping gas due to water Ù~llux. Since this interval has apparently already 1,vatered out, then residual gas has alrecu(v been trapped behind the 'l-vaterfront. It is possible that additional gas could be trapped in the reservoir. either due to trapping the same pore volume (~f residual gas at higher pressure or due to early breakthrough of vvater after gas Ù~jectíon. This is a risk that is inherent in storing gas in }vater-drive gas reseJ1Joirs. It should be noted that gas storage is conducted in aqutfers in sonze parts of the world. Storage in these reservoirs H.1ill have the same production-related problems as the water- drive gas reservoirs, but vvill also have a defìnite reserve loss due to 1-vater encroachment. In these reservoirs, water }vill encroach l,'vhen the injected gas Ìs produced, causing gas to be trapped thatH'illlikely ne-ver be recovered. 8. When plotting the PCU 2 and PCU 4 production history and p/z (based on pressures we have in our files) it almost appears they are connected to the same reservoir. Is there a possibility that #2 and #4 are completed in some of the same intervals? Theproduction andpressure data lve use for p/z analysis for the PCU #4 is li·OIlI the 51-5 and 45-0 in ten 'Czls. The production and pressure datafòr pi:.: analysis/or PCU #2 Ìs from the intervalfrom 39/5' to 3980' AlD, producedfrom the long string. ~f/e do not believe that the 51-5 and 45-0 intervals in PCU #4 are in communicaiiol11vith the long string produced inten'al Ùz PCU #2. Some afthe pelf intervals in the n·vo wells are in close stratigraphic proximity. hOlvever. It is possible that the 55-6 interval in PCU #4 is the same interval a5,' the completed long ) string interval (3915- 3980') in PCU #2. lVote that no production rate could be established from the 55-6 interval in PCU #4. It }vas assumed that the zone was either severely damaged, depleted, or both. The 51-5 completion in PCU #4 is in close proximit.v to the cOlnpleted short string interval inPCU #2, livhich is from 37()() - 3780 'All). This interval spans from the PC4 coal to the sands belo1-v. In the case of the PCLl #4 vI/ell, the 51-5 completion is in the sandjust above the PC4 coal. The 51-5 sand does not appear to be developed or gas saturated in the PC[! #2 ll/ell. In addition, no appreciable gas quantities lvere produced fronl the short string completion in the PCer #2 vI/ell. The vI/ell commenced production on 12/20/86 at a 0.72 mmcfd rate and 11/as shut in due to l-vaterproduction on 12/30/86. J..)"fubsequent atten/pts to return the well to production failed due to sand production. 9. As in the question [above, #4], it will be helpful to give the estimates of production from the 45-0, 51-5 and 56-5 sands at the dates pressure was measured in PCU 4. JiVe have not allocated production to the indtvidual sands at each tÙne that a pressure measl/,remeni 'was taken. PVe have, hO'vvever., used the single zone 51-5 production history from the period beginning in J\;fa~v 2004 to datel to estÙnate individual cwnulatìve production volumes to the sands. This ¡nethod is explained in Section G (page 6) afthe Storage Order Application. iVote that noproduction "\,vas ever establishedfrom the 56-5 sand. Gauge Est. Cumulative Measured Reservoir Gas Test Depth Pressure at Pressure, Produced, Wellname Date Test Type Reservoirs Open (MTD), ft MTO, psia Z res Psia bct P/Z, Psia Comments PCU4 12/10/2001 SITP 51-5 0 1345 0.8533 1466 0.00 1718 Unsure if well fully unloaded, assume gas gradient, may have liquid in well PCU4 2/3/2002 SIBHP 55-6, 51-5, 45-0 5,571 1456 0.8540 1455 0.25 1704 All 3 Zones open PCU4 2/3/2002 SIBHP 55-6,51-5,45-1 4,510 1485 0.8539 1457 0.25 1706 PCU4 5/2/2002 Surface PBU 45-0 0 1156 0.8677 1271 0.86 1465 Top 2 zones open, bot zone closed PCU4 5/10/2002 Surface PBU 51-5 0 1175 0.8654 1300 0.86 1502 PCU4 4/10/2003 SIBHP 51-5, 45-0 5,162 1028 0.8889 1026 1.72 1154 Top 2 zones open, bot zone closed PCU4 5/7/2003 SITP 45-0 0 1005 0.8826 1095 1.73 1241 Well Sl on 5/3103. On 6/5/03, SITP still 990 psig PCU4 4/20/2004 SITP 45-0 0 630 0.9225 687 2.03 744 Well Sl on -4/1/04. Tried unsuccessfully to unload to tank on 415-6. Sl since 4171 PCU4 7/6/2004 Surface PBU 51-5 0 935 0.8893 1021 2.16 1148 72 hr PBU w SPYDR PCU4 9/20/2004 SITP 51-5 0 833 0.8999 910 2.29 1011 ~ PCU4 2/7/2005 SITP 51-5 0 625 0.9229 683 2.58 740 PCU4 2/13/2005 PBU 51-5 5,162 669 0.9244 669 2.58 724 '- pc4JJressure_ data.xls #20 ) Alaska Oil and Gas Conservation Commission 333 West 7th Avenue, Suite 100 Anchorage, AK 99501-3539 Phone: (907) 279-1433 Fax: (907) 276-7542 Fax Transmission The information contained in this fax is confidential and/or privileged. This fax is intended to be reviewed initially by only the individual named below. If the reader of this transmittal page ;s not the intended recipient or a representative of the intended recipient, you are hereby notified that any review, dissemination or copying of this fax or the information contained herein is prohibited. If you have received this fax in error, please immediately notify the sender by telephone and return this fax to the sender at the above address. Thank you. To: ß("'\~("'o.. \\o.."""::¡(l \~c:...\. \)~~ \C~t-\<:.>-.~~~, Fax #: ;) G:> ~ - <2S'<\ "-\ ~ From: Date: ÞOt~ Ö~ ().OO$" Phone #: Subject: ?~~\. ~o-~ ~~~~ Message: ß ~~ ~ .,....., \-\ct.~ ~~ ....<t.~\~\ ~<:.~~,,~ ~~~\",,0 N;:)c::..c... \\";:. ?'{"'tè\\-f c..~"- c;..\-o("Ca.~ ~ \Ð~<!:.~..:\:-. \\~">~ <.).,,~ ~~'3'\~~ \?l-r'it}~~~I$::.<::..-\- R(ë )j~<:.û~c-..~,> o.~ ~ Q) "1/ã-<;-Cl;; ~~(-'--\<t.~~ v..~':\>oa\<é:~\~ \ ~Q... \ ~ ~{~ -<::'C; c..c,~~,»..'\~' ~~~ ~~ -\"ò ..ç.\\~ \ ~~tè.. ~ .., IJ.",-c:£ h."<!::AM.......~ ~~c..'"\& '6~'7é0 "/\\-'05: \n.ð'l.~ ~Ì"Öç.(..:,~-.)~..\-- ~{""Wc.a.~"S \ ~~ ¢ <J¡1';1.~-t:§::; C~ ~\'<;.\ Cf)~~c:!:>\..\- \~. Pages (including cover sheet): \~ If you do not receive all the pages or have any problems with this fax. please call for assistance at (907) 793..1223. DATE, TIME FAX NO./NAME DURATION PAGE(S) RESULT MODE ) JOB STATUS REPORT 08/03 07:05 2598943 00:02:25 13 OK STANDARD ECM ) TIME NAME FAX# TEL# SER.# 08/03/2005 07:09 AOGCC 9072757542 BR02J2502370 #19 08~01/2005 15: 51 FAX 907 269 "'\'3 SOA DIV OF OIL & GAS ) 141001 IltEC~/lß~.. l..~ . . C¡W!'cD AUG" () ',' . "CIII . 1. Z005 ~~~~rf1t~ ro: ~~:J;-;=M~_"~=~~':~~~~~" PHO~~~~~.~~·~~=~~~~~~= J:'O...M~~_._..,_~~_C ~ _..__._"",."_,,..~LAX NO.: _.__,."."."".___________....,.. 1£~º-~~...",.."'".,,..,.._..L_~ß--~~-1-)-ß,"{L,'~,..Q...~J~ 1_ PHº~~.~,'~..,..,.~"._____ ____._......,'''''''''''''''',..,''',........_..._._~ ~~~==1:ZQC?_t_=====]~;~~=~,_:__~~-±·~~=] State of AJaska Department of Natural Resource Division of Oil & Gas 550 West 7th Avenue, Suite 800 Aulchorage,AJC 99501~3560 (907) 269-8800 ''''''ëë·:···-···--------·-····'-'''''''''''''''''''''''''''''''''''''''''''''''..''·'".,.,....-...--...--.--.------- 111PII.mrluIIIIUllliih.......I.....__. 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'.: :.. .'.. ", "," .' ". '. '.' . '. . . ' : I I I I I r I I", , . , _. .. .' . .. ". .' '.' . . . ~ ..,. I.. ':,',::',' . ,,',,:~O~Qìn,,~t~ÝC?a~m: ",:' ,'.'.' . :' :.' :',<,<,: :,:, :-..: ',' , ,; ,::" ,:, ..: ,~,; ,," ':' ... H ,...... . .~: . .' '.'. Tlús:¡e~: is ~~bmitt~~ p~u~n ~9 .the.P.ivisi~n'.s requ~~. foÌ p~~1ic:~~~'<:k\t~d June , ' '.' . . . . . . .', " ':,:' . ,24~ 2,005 ·~&at~ -:C!nó'q~?~ ái:ipncåtìC!n.,for a, Gas··Storage 'Lease ~thin:the ~:(~ Crc::c~ .," ,.'" ,,'..._ "'" :- ':' 'U~t: ';' :',' ":, ',:: : ' '<'" '.' .. :::,:,":"''-: ", «,:-, , :,. ,'.',", ", ::;:~' ': :' " /' : ' .. .: .. .' . '." , T~~'Baÿ Oir&'ß~~ LLC trij'OG) ,dWrls ñ~e·ôi!:ànd.'gas'·leaS~ ~~~i:v..~~íb.e.: . .' '. ':"" , " '.,". . no~t:h· of ~d ,~o~ti~us ~th::th~ P~y~, Qr~~ T)J;Üt.. ,~qG, p.!au.s.. tP."LþiI.l. 0:D;e .or more' Q~l. ',:. ': :. ,... . ., "andlqr' g!iÍs w~lls,'~J1"oij.e·o~'m,ore pfthe Ie~es'.co~ttgud~'\Vith the Prclíy Creek·U¢t+. .'.: .".. .'. ",'.:.. . , . ,'. "" ::: . -: ,. ': ' ,',.'. " " " '. ,'. . : .~. - .... .:. '. . . ., ,,'.' I ' ,." ,:, ': "'" ,."":'. :.'. '. . '. ' . . . . . .... "". .. '. , . . ,", ' ",' .... ..., .' W~th:I:e~ to ·lJ~o~~.F$ a.ppli<:~1fbri to 1JSe,.one or m..o~e pte:ŸioU3~Y ptoduped g~s z:~zi,9s . . ,',:,' ',: :.. ': :-, " ':"" : : ". ~~~~lying'th~ ~ C~~·Ú·nii:'for. gås··ínj~9ti.O~ ~.d ~pragë, T~~g:Bay'rðqU~sts~ ". . ,,'. '", " , ',:.:"",',"~."'.." the'Di\Visio¡;(pfOìl&.Gás.CårefullYJ;e~ewUÙ~~~,p~¢nt.geol¢gic~aridgeòphYsiGal:data:'.·.·:. " ", ' ,'"",':., ,:,,"1, ,,,:.",. :: fi?~!Þe~r~ttr·~C1;~e~U:ni~ino.r~¢r;·~~·~~~~'¥T~i?G:s,?P~~þQ~~~ör·~r~~ii~~.:;.. .....:.. .....' .' ',,' " . ,.,. .'. '. w1l1n()tbeeffectedby.~:storageus'41ga,:Pretty,CreekÛllitwen·as~lnJectiÇt:I.1:welL. . . '. ",': ',.: ':'. ., ,', :.. T;B,OGm>Uldlik~:assnran~thaàJ~~~~é$~~~~;~~i~'a'~s st~ragel~e .. .~ ,'.' ;:.,' . ..> ~ '¥iìt1iin the·.Pietty.çr~k Unit will not ie$1.ilt i:ri·any..,di~u~~ regarding o~¢Ishi.p of iæ .., :" '.. . . . , . ", . p~o~uçeQ. frÔm: any ion~ penör~te4' 'Yithi;o a '~ell. driÌled on '~rie of the TBQG Je~s ., ',' "~ . ..... '< .. >.' .'. .':. :," aSsµ.i:ri.iñg sáid·wdl.iS .located.át·least. ¡,5QO" from the Pie~ 'Crook Up.jt boùn~r.· ,,' . :. , : , ....':, ~ . ,.' ',~.'. Lik~.~~;, ~.9G..~ou;ld Hk~ assurariçe ~aÍ:"Uno~~s gæ' '~rag~ ôper~tip~ in' thé P~~tw ':'. : ". ". ".' . '.". çreekU~t,wiU not.signifi~!ID~Y incte~ë ~ pr.ess,*e f'::HInG} ~ any ,zon~,on,the·TBqG.. . -<~ , . ,'; ..,: .1~es.lQCate~-atleast ~.jOO~.ftom"the P;rettý.:Creel<Umtb.ò'W:I:d~<IfT...TDoca:I?s stc)~e.·. . ." .' :. . .'.' "",',,', ~viti~~ ~ere't~·cì-~ä~·~.t{a~~o~y:#s~e~.:zo~· ~~~~~.·or'~q.re·'o'fthð, TBQG "', :.' '. .:. '.;" . . ' '. '. '. '·l.eases.to the .ilo~ 'oftbt' Pretty Creek Uni~.vèry signific-arit safety ~ 'op~onal~ and.' "" '. " .:. '. ,:. .~. ",', ".':." ::.-. env1römhentarprÒþ.lems..~otÙd;eIÌ1.erge,\yijen.~ob.azone'is p.èn~tràte4 by.~e bit ~hi~e . '. ....,. ': >.' . ',' ....':--, '.',: .".:. "dr:ijl~g,~~XplOrå1ion'~~n·~ri.$~TBO~ 1~(~):. ." .:'..' , .' ." .: ....: '. .:._ ..' ; . .,..... '. ',' : >.-:: .' ,." ':~>,,, " ': .,'!Ü ~~~~ry'-iÚt.~ be'~o~~Ä~:unò~ ~'þl~~ru~ ~qmj~tmtoa dis~e'. .... . ,.,".. . " ,.'.:". ,,"reservoirthat is not' ,in ·èonnnunicatiòI). 'With.any zones'löèatè"d under,the,TBOG-.léases~' . . ." . . ..' '. ."', :.·,~n,TIkcfu¡g·B~t~ås,~o:obJ~?n or"·~oir~'eniš'.re~ativè.:.t?..tJnòcå.T:~"·PÌ"ç.~os&·~o store g~ ':': . ... ." . . . .,:.;.' I. ':" ip:jetted;~' a'Pr~ttY Çreek~·Unitwell'.·. Ifr.her~.is·apq·ss.Î~ility~t}Jnoc~r~I.PI\?Þó.se4'.· .... . . ....:. ",' ,',', ",.',siorag~·0p'era#on~,a't,aga~ storage leaseWï:~ ~è futty ç~k: Vnit,m~~ ~II1p~t" Tradß:1g. '. I . ,~ . " ,r . .. . , I I .. .' . .. , ,.. 141004 PACE 1/1 . .... . .. " ".' , . I' ", .. ,¡ " , .. . . '.. .. \ I' ; '" . " . " \ " '. . , .' " , '. I . . ' , .... , " '.' . '. . , I . " .... I.. . . . . '" " .. . ~; I ' . , . . .., I '. ' ,", .",' I ,', '-. . :. ,', I .. ., . . . . ," '" , .' . . . , I' , " I . . , ,_ I I , , 08/01/2005 15:52 FAX 907 269 8943 SOA DIV OF OIL & GAS r", . " " · "~ ,""O~,' PAUL ) eRA] G PHD. " [D. 9"72· ~ 1 ~, . .. ,,., ,.. . . . '. . . ~"~~'" " :' \.":'".... "'. ,':.' ". .",. '. _. '., .,:.1.', :1 II~ ,,~ ',' ., '. ",' I Ij, 1'1'11 ¡ ¡ ~~ \1" ':: , ,I./ . I '1. .,' I I I I I '. '. . .. .. ' '. . / . -~ . :... . ',_ ,". I:: I I' '.: I, I I' ',_ '.' .... r1 . .. ~. I ,I I'. ....' . _, .... . .' . · , .' '; -...., BaY).'s ~p~ratïönS aD.d!ór·.pro,duct~Qf1 {roln weHs 'drilled' 81. ie;ast 1 ~5OÓ~: ~m. the Pretty .':.', ". . ' ' . ;', ,....... , '",' .:'. 1Cr:eek 1)nitbomid3rY".the~'TB'QO'Wó~d· op~~'.using the)?rettY .ÇreekUnit~i1 ~or gas: " .. ,'.. ','., , " " '.' .':'-: '.' . ~jecliö~ ánd"s.torage..~~far.~ tllls ~u1d!>e cn~~ tq. the' State'.s best inter.est. ,Fþr' " . ,'::' '.: ' ", ' .'. ': '.:" '. ,~. ..:..' ",.:exIDnplê, if.'TBOØ~s· opera:tÍoIi$ ~e.potentiaUy impacted by a,gas injectionleaSe. "'. . . ' " :' . :. ,., ',' . ,imIDeiiiiiely ,tò,tñè :south,· '~nv~o¡-s ,and1or p~eiS,'i~víe:wiPg'1:he 'puSsibility .ofdrillmg ... . , .' ':', , . " ',' \ th~ WQG·l~. ihày de~ide."t?-qt tq pioç~ 'Yi~ 'exþlorwon and produ~on on ~. ," . . , " . ".' " TBOG..ieases for this reaSon.'. ·Ìfthis were to OCÇU[\ thë Sfute of AlaSka would.',notbenefit " " .~ :', "',.' ,.,." . frolli:de~elopmenf¿{the.pós$ible gas' reserves belowthe·rnÖa leaies, and,"would nót ' . . .' . . '~6y ~e [pyaltY'iriÇ~m¢. ~ ',~'p,,~s' þi:od~¿iiQ~ ~es.: paid by :moo, '3r.J,d WQ~â Ì1~t .,,' " . '. .'.: ':'. . .~ '.: ·,bën~fi~·frO'~.the.p~4üctio~' of·tlüs"gð$ lo,·ser.ve\the n¢ed~ qÍ AIaskarl.,g: loéateclaroùn4 the ' '. · . . .i,. ........ :, .·Cook.IbÏetbasin.·.· . "',: , ': ' " ,. '. ':'" ,':,', .' .'. .... .' . ' '. .' : ."'"'' .:' " " " ". .'. . '. :... ' ", '. " ..,':;. ' "" : . :. . ~ " '.': , . , , .' :.; ,':'" . ". '.:: As staÌ~d:p~~iq~;31J7'ií~:z~rie(s) ÛnqcaJi;;,propò~~g for.g~ inje~ö~.'~d:~orage '. :,1' " '.' ....' .:". i';, ',.. . '~anbn~' åf~ '~SC19D#n~~uS ~th geo}9'gi~ z6h~s ~~~~r1yj.rig ili~ TBqG)~~s, '~~'1Ïò .' ", . .'. . '. ~tt.eet#·ar;iSe ··oo.:the pàrt o;f TBQ.G reh~tìV'e ~o Unocafs ,request fõr a' g~ storage -leaSe "', , . , ....: . .... Witñin'·th:P· Itty 'C" . k uIDt ......" .... ,.."..:'.' . . ., ,. " : ' " :'. <':...:'..::'....,,':<,'..'....'.. ........:...~.:...~" ~...r~:~ .,..' ....... <.'......;. ..:..:....,......:-:,...;.:.....'.,....'. . .... .. ." ",':"" ~....: ','~ .,:'. .', ';', , ": Th~,ÿollfo~".tiey·· ',~ g"tþese cö-mø.~DtS·and·9onqe~s~· . ,'" ",:.'", "',,' " . .. " .... ":. " ", '., ,,,:,,:',.':.' I '. . : :.... ' . /"'" ',. '.' " "'. ¡ ," ,"',,:,..;" :". 'I.'" '..'" . ,: ' . , " I ,I fl. I I . I I ,I I .,,,:,,'.",·:,',",,'S1n· "". ",' ", .,,' . \. ". .\., ',. < '.' '. .' " I ,I I 1\' 141005 PAGE 1/1 . " . , . ., , ',' ' IIII ,II, ' '. .'1' 1,1 I .' ' , ' '" . " . '. . , " , ; ,', : , . , .1 " ' · " , " I ., . 'II . '., '\. . I' I I , , 11 r I I .' I I' I I I. I111 / ,n, , I,' I ,. , , " ," ,. " . .' , . : I ',I , , " ' , " '. . ': ','- " ., .,' .. '" '. , -' . . . . ':, " . ' '.. I''':'',''''': ,.,' . ' . .. 1 I 'I r. , I , ' ., , , , I I 1.1 . '. , , . , \ ' , , " , . .. . . . , " :' ; . ~ ' ::" " I I . '1'1' , I. ~ I 'II 1 ." .. . " . . I. . . ,., .,, I ..' ,', .. 'I " " .'... , ", , r. , . . . I II' ' , :.' :' " '..' ':,' " . i, : . . '11 . I '11, I, I '.', . , ' I,' : . ' 1'1' t,' ~ I '. r ' , , ' 'r, ,', ." I . , '. ',' I ,'I , 'I ,i" I, " : '.' . "'\: '" , ' I I . , I ~ ~"I ,\ , ..... , ,~ I , ,II i I. I '" , . , , ',' . .. , ~ r , , .11 "','. . . , . I' ., . . , ~ .. I 'II I 'I'll , . , I , .. I' I ~ .. r I . ' - . I·· \ ' . . I,. , · ,. . I . ' .". Jo. . - . ' , , , . \ . .. . , .. '" " ~ -' .. .., , '. ~ , " ,I' , I , · ~ I" " '..., ," , ...,'.. ., , , ..' , I , , , I . ~- ~,', " :' "',:," ',' .. I I.. ~. ..., '. '. " " .' 1, 'I . .: :.:' '::.' '"~ . I ,'.:~, . . " - . . . . . . .' . ...." '.' .".', - n" . . \ .. :'. '. . '.," " . .' .. . .. " , . . -' - ' " , . . · . . . .' I,: I , '", ' . , . I.. ", . " ".,: I . . . .. . , , . " I , '. I I I .' ." , I , , , ' /', ",. " ~', " . . . , .: I' " . . .. . . . ,'" , 'I' . , "L" :', . . ,,' , " ,; . . ,', '. "'.' " .. . . . . . ., " ., ' '~ '. . . . ',. ..', . .. , , , , . , . , . . . ': ,\' . ' . . ..~. :,' ..'" ,'.' ". '. \. . , ....-. ". . ' . " ','.,.. . , . " ." ~ ..,' .. .', .' I, .' '. '." , . .\ . .,. .'" . . .., ., , . . .. , '[' ,: I I . .. ~ ':I'" ..' ..' . '. ~L.' .' " " #18 '@I~\ !~Tri ' ff0/~..' ~ ¡:::n , \. I!! ,;~. ;1 f. :.! ,\, 'I~' " ,~ II: I : .\\ ~ i ./ ¡i \ \ Ui; j:~ 1'1.; j :1!1 1 ]-='). \\'1 \ I "r ""-"'" :"",:¡ W \\.J¡ . I ~ .11). 'n" ¡·F :' I '. I : i : ¡ ¡ : ; ¡ i;)i)!~¡ \~ 1W ) ~"., U" ¡:'T\ (--'~ :1'7~\ ' ¡\ \ : i " {\\ ~ (U , ¡ I / J\ 'I. ,f ß ;', ¡; I,: !.J ···~'\\~1 ¡ i.···, / jJ .....~ " ¡', I, i ~ ~ :, ~: ,., . ) ;', \. i":1 ',\ ~ 'I ! J I ' : " " ,:.' " \ ¡Lnù ~ iU W\~¡ J ~ u-u ) A",ASIiA OIL AND GAS CONSERVATION COMMISSION FRANK H. MURKOWSKI, GOVERNOR 333 w. ]TH AVENUE, SUITE 100 ANCHORAGE, ALASKA 99501-3539 PHONE (907) 279-1433 FAX (907) 276·7542 July 29, 2005 Dale Haines Oil and Gas Operations Manager U nocal PO Box 196247 Anchorage, AK 99519 Re: Pretty Creek Storage Injection Order Dear Mr. Haines: At 9:00 am on July 26, 2005 the Alaska Oil and Gas Conservation Commission ("Commission") convened the hearing on Unocal's request for a storage injection order for the Pretty Creek Gas Storage Facility. Per Unocal request the Commission recessed the hearing and it will reconvene on August 10, 2005 at 9:00 am. -/ cc: AOGCC Commissioners Dave Cole, Unocal Lois Epstein, Cook Inlet Keeper Paul Craig, Trading Bay Oil and Gas, LLC #17 Fwd: Proposed ACMP Consistency OeterminatinJ'1 ':" Gas Storage Lea... . ) ) Subject: [Fwd: Proposed ACMP Consistency Determination - Gas Storage Lease Application ADL 390776] From: John Norman <john_norman@admin.state.ak.us> Date: Thu, 28 Jul2005 17:33:21 -0800 To: JodyJ.Colombie <jody_colombie@admin.state.ak.us> CC:Cathy P Foerster <cathy_foerster@admin.state.ak.us>,Dan T Seamount <dan _ seamount@admin.state.ak.us> pIs pritn and file in Pretty creek gas storage appn file. Thanx -------- Original Message -------- Subject:Proposed ACMP Consistency Determination - Gas Storage Lease Application ADL 390776 Date:Thu, 28 Jul 2005 08:40:01 -0800 From:Jonne Slemons ~ionne slemons(c~dnr.state.ak.us> Reply- To:jonne slemons~dnr.state.ak.us To:Kevin Tabler <tablerk(Z~unocal.com>, "John K. Norman" ~iohn nonnan(á)admin.state.ak.us>, Susan Lee <Susan.I.lee(ä~matsugov.us>, ben greene(c~dnr.state.ak.us, kim kruse~dnr.state.ak.us, christine ballard(á~dnr.state.ak.us, n1atthew lacroix(êì)dnr.state.ak.us, mark fink~fishgam.e.state.ak.us, wayne dolezal(á~Üshgan1e.state.ak.us, patricia bettis(á)dnr.state.ak.us, kellie westphal(ci}dnr. state.ak. us, linda books(á)dnr. state.ak.us, cynthia espinoza(c~dec.state.ak.us, lydia mjner(c~dec.state.ak.us, stefanie ludwig(à~dn:r.state.ak.us, Paul Craig <pcraig~gci.net> CC:Patrick Galvin <patrick galvin(c~dnr.state.ak.us>, Brian Havelock <brian havelock(c~dnr.state.ak.us>, Pirtle Bates <pirtle bates(á)dnr.state.ak.us>, Bill Van Dyke <bill van dyke(á~dnr.state.ak.us> Distribution of this Proposed Consistency Determination is being made in advance of the original schedule. Please note that any elevation of this proposed determination must be received by 5:00 pm on August 4, 2005, by postal mail, fax or e-mail as identified below. Jonne Slemons Manager, Oil & Gas Permitting Division of Oil & Gas Department of Natural Resources 550 W 7th Ave Anchorage AK 99501-3510 Fax: 907-269-3484 - OR -- 907-269-8938 E-mail: ionneslemons~dnr.state.ak.us Phone: 907-269-8806 John K. Norman <John Norn1an~admin.state.us> 1 of2 7/29/2005 7:40 AM Fwd: Proposed ACMP Consistency Determination..:- Gas Storage Lea... . ) Commissioner Alaska Oil & Gas Conservation Commission ) ! Content-Type: application/pdf Proposed Consist Determ-Gas Storage.pdf. . b 64 Content-Encoding: ase 20f2 7/29/2005 7:40 AM ) ) MEMORANDUM Department of Natural Resources STATE OF ALASKA Division of Oil & Gas DATE: July 28, 2005 TO: Distribution List FROM: Patrick S. Galvin Director SUBJECT: Proposed ACMP Consistency Determination for Proposed Gas Storage Lease Application (ADL 390776), Pretty Creek Unit The Alaska Department of Natural Resources (ADNR), Division of Oil and Gas (DO&G), is reviewing the proposed gas storage lease application for consistency with the Alaska Coastal Management Program (ACMP). Union Oil Company of California (Unocal) proposes to store natural gas in two gas sand horizons within a gas storage reservoir area utilizing existing gas wells and facilities located approximately 30 miles west of Anchorage in the Susitna Flats State Game Refuge. All of the lands within the proposed storage area are subject to existing oil and gas leases owned and operated by Unocal. The proposed lease area lies within Alaska's coastal zone, and has been reviewed for consistency with the Matanuska-Susitna Borough Coastal Management Plan (MSBCMP). DO&G is issuing this proposed consistency determination under 11 AAC 110.255. On June 24,2005, DO&G initiated an Alaska Coastal Management Program Review for the proposed Gas Storage Lease. Agencies, local governments, coastal districts, the oil industry, environmental organizations, and the public were invited to comment on the proposed lease's consistency with the ACMP, and on any issues relative to the state's best interests regarding the proposal. Several entities provided comments. Alaska Department ofFish and Game (ADF&G) commented that the mitigation measures identified in the Cook Inlet Areawide Oil and Gas Lease Sale Best Interest Finding, as supplemented in 2004, should be applied to the proposed lease. The Matanuska-Susitna Borough, Department of Planning and Land Use, commented that the project is consistent with stipulations of the MSBCMP. Enstar Natural Gas Company commented that: 1) since the proposed operation involves only existing facilities and leases it should be found consistent with the ACMP; and 2) the ability to supply gas from storage to help meet peak-demand needs for half the state's population must be considered a very high priority. Trading Bay Oil & Gas, LLC (TBOG) commented that no concerns arise regarding the proposed lease, "... if the zone(s) Unocal is proposing for gas injection and storage operations are discontinuous with geologic zones underlying the TBOG leases..." and requests 00&0 determination of such. DO&G has made preliminary determinations that the area in the application wholly contains the injection formations. Further, this issue is not relevant to the consistency review, which is focused on surface impacts, but will be thoroughly addressed in the Best Interest Finding. ) ) Page 2 of 10 A best interest finding for the proposed lease is valid for the length of the lease. However, proposed activities on the lease will be subject to ACMP consistency. Both the best interest finding and the final consistency determination for the proposed lease are scheduled for release on August 15, 2005. Following review of the comments received and the proposed lease, DO&G will attach mitigation measures and lessee advisories based upon the Cook Inlet Areawide 2005 Lease Sale mitigation measures and lessee advisories, as terms of the storage lease. The complete Mitigation Measures and Lessee Advisories to be attached to the proposed gas storage lease are set out below: Mitigation Measures General 1. Use of explosives will be prohibited in open water areas of fishbearing streams and lakes. Explosives must not be detonated beneath, or in close proximity to fishbearing streams and lakes if the detonation of the explosive produces a pressure rise in the waterbody greater than 2.5 pounds per square inch (psi) unless the waterbody, including its substrate, is solidly frozen. Explosives must not produce a peak particle velocity greater than 0.5 inches per second (ips) in a spawning bed during the early stages of egg incubation. The minimum acceptable offset from fishbearing streams and lakes for various size buried charges is: Charge Weight 1 pound charge 2 pound charge 5 pound charge 10 pound charge 25 pound charge 1 00 po~nd charge Distance from Stream 37 feet (11.2 m) 52 feet (15.8 m) 82 feet (25.0 m) 116 feet (35.4 m) 184 feet (50.1 m) 368 feet (112.2 m) There are numerous fishbearing streams and lakes within the sale area. Specific information on the location of these waterbodies may be obtained by contacting ADNR's Office of Habitat Management and Permitting (OHMP). 2.* Onshore exploration activities must be supported by air service, an existing road system or port facility, ice roads, or by vehicles which do not cause significant damage to the ground surface or vegetation. Unrestricted surface travel may be permitted by the directors of DO&O and Division of Mining Land and Water (DML W), if an emergency condition exists. Construction of temporary roads may be allowed. Temporary means that a road must be removed to the extent that it is rendered impassable or is otherwise rehabilitated in a manner such that any placed gravel remaining approximates surrounding natural features. Construction of permanent roads will be prohibited during the exploration phase. * Exception - DML W ) ) Page 3 of 10 3. a. Removal of water from fishbearing rivers, streams, and natural lakes shall be subject to prior written approval by DMLW and OHMP. b. Compaction or removal of snow cover overlying fishbearing waterbodies will be prohibited except for approved crossings. If ice thickness is not sufficient to facilitate a crossing, ice and/or snow bridges may be required. 4. Water intake pipes used to remove water from fishbearing waterbodies must be surrounded by a screened enclosure to prevent fish entrainment and impingement. Screen mesh size shall not exceed 0.04 inches unless another size has been approved by OHMP. The maximum water velocity at the surface of the screen enclosure may be no greater than 0.1 foot per second. Facilities and Structures 5. a. The siting of onshore facilities, other than docks, or road and pipeline crossings, will be prohibited within 500 feet of all fishbearing streams and lakes. Additionally, siting of facilities will be prohibited within one-half mile of the banks of the Theodore, Beluga, and Susitna rivers. New facilities may be sited within the one-half mile buffer if the lessee demonstrates that the alternate location is environmentally preferable, but in no instance will a facility be located within one-quarter mile of the river bank. OHMP concurrence will be required for siting within the one-half mile buffer. Road and pipeline crossings must be aligned perpendicular or near perpendicular to watercourses. b. Lessees will minimize sight and sound impacts for new facilities sited less than one-half mile from river banks and in areas of high recreational use by (1) providing natural buffers and screening to conceal facilities; (2) conducting exploration operations between October 1 and April 30; and (3) using alternative techniques to minimize impacts. 6. The siting of new facilities in key wetlands and sensitive habitat areas should be limited to the extent possible. If facilities are to be located within these areas, the lessee should demonstrate to the satisfaction of the Director and OHMP that impacts are minimized through appropriate mitigation measures. 7.* Measures will be required by the Director, after consultation with OHMP and ADEC, to minimize the impact of industrial development on key wetlands. Key wetlands are those wetlands that are important to fish, waterfowl, and shorebirds because of their high value or scarcity in the region or that have been determined to function at a high level using the hydrogeomorphic approach. Lessees must identify on a map or aerial photograph the largest surface area, including reasonably foreseeable future expansion areas, within which a facility is to be sited, or an activity will occur. The map or photograph must accompany the plan of operations. 00&0 will consult with OHMP and ADEC to identify the least sensitive areas within the area of interest. To minimize impacts, the lessee must avoid siting facilities in the identified sensitive habitat areas. *Exception - OHMP, ADEC. 8.* Impermeable lining and diking, or equivalent measures such as double-walled tanks, will be required for onshore oil storage facilities (with a total above ground storage capacity greater than 1,320 gallons, provided no single tank capacity exceeds 660 gal) and for sewage ponds. Additional site-specific measures may be required as determined by ADNR, with the concurrence of ADEC, and will be addressed in the existing review of project permits or oil spill contingency plans (C-Plans). Buffer zones of not less than 500 feet will be required to separate onshore oil storage facil ities and sewage ponds from marine waters and freshwater supplies, streams and lakes, and key wetlands. Sumps and ) ) Page 4 of 10 reserve pits must be impermeable and otherwise fully contained through diking or other means. *Exception - OHMP, ADEC. 9. * With the exception of drill pads, airstrips, and roads permitted under Term 3, exploration facilities must be consolidated, temporary, and must not be constructed of gravel. Use of abandoned gravel structures may be permitted on an individual basis. *Exception - OHMP, DL. 10. a. Wherever possible, onshore pipelines must utilize existing transportation corridors and be buried where soil and geophysical conditions permit. In areas where pipelines must be placed above ground, pipelines must be sited, designed and constructed to allow free movement of moose and caribou. b. Offshore pipelines must be located and constructed to prevent obstructions to marine navigation and fishing operations. c. Pipelines must be located upslope of roadways and construction pads and must be designed to facilitate the containment and cleanup of spilled hydrocarbons. Pipelines, flowlines, and gathering lines must be designed and constructed to assure integrity against climatic conditions, tides and currents, and other geophysical hazards. Local Hire 11. To the extent they are available and qualified, the lessee is encouraged to employ local and Alaska residents and contractors for work performed on the leased area. Lessees shall submit, as part of the plan of operations, a proposal detailing the means by which the lessee will comply with the measure. The proposal must include a description of the operator's plans for partnering with local communities to recruit and hire local and Alaska residents and contractors. The lessee is encouraged, in formulating this proposal, to coordinate with employment services offered by the state of Alaska and local communities and to recruit employees from local communities. Training 12. Lessee must include in any plan of exploration or plan of development, a training program for all personnel, including contractors and subcontractors, involved in any activity. The program must be designed to inform each person working on the project of environmental, social, and cultural concerns which relate to the individual's job. The program must employ effective methods to ensure that personnel understand and use techniques necessary to preserve geological, archeological, and biological resources. In addition, the program must be designed to help personnel increase their sensitivity and understanding of community values, customs, and lifestyles in areas where they will be operating. Access 13. a. Public access to, or use of, the leased area may not be restricted except within 1,500 feet (457 m) or less of onshore drill sites, buildings, and other related structures. Areas of restricted access must be identified in the plan of operations. b. No lease facilities or operations may be located so as to block access to or along navigable and public waters as defined at AS 38.05.965(13) and (17). 14. Lease-related use will be restricted when the commissioner determines it is necessary to prevent unreasonable conflicts with local subsistence harvests and commercial fishing operations. In enforcing ') ) Page 5 of 10 this term the division, during review of plans of operation or development, will work with other agencies and the public to assure that potential conflicts are identified and avoided. In order to avoid conflicts with fishing activities, restrictions may include alternative site selection, requiring directional drilling, seasonal drilling restrictions, subsea completion techniques, and other technologies deemed appropriate by the commissioner. Prehistoric, Historic, and Archeological Sites 15. a. Prior to the construction or placement of any structure, road, or facility resulting from exploration, development, or production activities, the lessee must conduct an inventory of prehistoric, historic, and archeological sites within the area affected by an activity. The inventory must include consideration of literature provided by the KPB, MOA, MSB and local residents; documentation of oral history regarding prehistoric and historic uses of such sites; evidence of consultation with the Alaska Heritage Resources Survey and the N'!tional Register of Historic Places; and site surveys. The inventory must also include a detailed analysis of the effects that might result from the activity. b. The inventory must be submitted to the Director for distribution to DPOR for review and comment. In the event that a prehistoric, historic, or archeological site or area may be adversely affected by a leasehold activity, the Director, after consultation with DPOR and the KPB, MOA or MSB, will direct the lessee as to what course of action will be necessary to avoid or minimize the adverse effect. c. Discovery of prehistoric, historic, or archaeological objects: In the event any site, structure, or object of prehistoric, historic, or archaeological significance is discovered during leasehold operations, the lessee must immediately report such findings to the Director. The lessee must make every reasonable effort to preserve and protect such site, structure, or object from damage until the Director, after consultation with the SHPO, has given directions as to its preservation. Fishbearing Streams 16. Under Title 41 of the Alaska Statutes, the measures listed below may be imposed by OHMP below the ordinary high water mark to protect designated anadromous fish-bearing streams. Similar provisions will be imposed by the Director to protect non-anadromous fishbearing streams. Specific information on the location of anadromous waterbodies in and near the area may be obtained from OHMP. a. Alteration of river banks will be prohibited. b. Operation of equipment within riparian habitats will be prohibited. c. The operation of equipment, excluding boats, in open water areas of rivers and streams will be prohibited. d. Bridges or non-bottom founded structures will be required for crossing fish spawning and important rearing habitats. In areas where culverts are used, they must be designed, installed, and maintained to provide efficient passage of fish. Waste Disposal 17. Solid waste disposal: ) ) Page 6 of 10 a. Solid waste generated from the development and/or operation of the lease areas shall be reduced, reused, or recycled to the maximum extent practicable. Garbage and domestic combustible refuse must be incinerated where appropriate. Remaining solid waste shall be taken to an approved disposal site, in accordance with 18 AAC 60. New solid waste disposal sites will not be approved or located on state property during the exploratory phase. Exceptions may be provided for drilling waste if the facility will comply with the applicable provisions of 18 AAC 60. b. The preferred method for disposal of muds and cuttings from oil and gas activities is by underground injection. Injection of non-hazardous oilfield wastes generated during development is regulated by AOGCC through its Underground Injection Control (UIC) Program for oil and gas wells. c. Discharge of drilling muds and cuttings into lakes, streams, rivers, and high value wetlands is prohibited. Surface discharge of drilling muds and cuttings into reserve pits shall be allowed only when it is determined that underground injection is not technically achievable. A solid waste disposal permit must be obtained from ADEC. If use of a reserve pit is proposed, the operator must demonstrate the advantages of a reserve pit over other disposal methods, and describe methods to be employed to reduce the disposed volume. Onpad temporary cuttings storage will be allowed as necessary to facilitate annular injection and/or backhaul operations in accordance with ADEC solid waste regulations 18 AAC 60. 18. Wastewater disposal: a. Unless authorized by NPDES and/or state permit, disposal of wastewater into freshwater bodies, intertidal areas, or estuarine waters is prohibited. b. Disposal of produced waters to freshwater bodies, intertidal areas, and estuarine waters is prohibited. c. Disposal of produced waters in upland areas, including wetlands, will be by subsurface disposal techniques. d. Surface discharge of reserve pit fluids will be prohibited unless authorized in a permit issued by A OGCC and approved by D L. Gravel Mining 19. Gravel mining within an active floodplain will be prohibited. Upland sites will be restricted to the minimum necessary to develop the field in an efficient manner. Special Areas 20. Management of legislatively designated state game refuges and critical habitat areas is the co- responsibility of ADF&G (AS 16.20.050-060) and ADNR (AS 38.05.027). For activities occurring within a refuge or critical habitat area, the lessee will be required to obtain permits from both ADNR and ADF &G. The Susitna Flats State Game Refuge is partially within the lease area. Operations within this refuge must comply with the terms and conditions of the lease, the regulations contained in 5 AAC 95, and the requirements applicable to special area management plans. Where the ) ') Page 7 of 10 requirements of this term are more restrictive than the requirements of other terms, the provisions of this term prevail. a. Surface entry for drilling and above ground lease-related facilities and structures will be prohibited within the primary shorebird area in Susitna Flats SGR. Surface entry may be allowed on uplands within the SGR. Directional drilling from adjacent sites may be allowed. b. Exploration, development, and major maintenance within important Tule goose and trumpeter swan habitat in the Susitna Flats SGR and within the primary waterfowl area above mean high tide within the Susitna Flats SGR will be allowed only between November 1 and March 31, unless an extension is approved by ADF&G and DO&G. Routine maintenance and emergency repairs will be permitted on a year-round basis during the production phase. A detailed plan describing routine maintenance activities to be conducted between April 1 and October 31 must be submitted to ADF &G and DO&G for review and approval. c. Gravel pads and wellheads are the only above ground structures that will be allowed within the primary waterfowl area above mean high tide and in important Tule goose and trumpeter swan habitat in the Susitna Flats SGR. Construction activities within a refuge must utilize the best available technology to minimize the visual, biological, and physical impacts of these structures and must be approved in writing by ADF &G and the Director. d. Surface discharge of produced waters will be prohibited. e. Disposal of drilling muds and cuttings will be allowed only at upland sites approved by the Director and ADF&G, after consultation with DML Wand ADEC. f. Facilities must be designed and constructed to prevent the spill and spread of hydrocarbons and to facilitate cleanup efforts. g. Facilities must be designed to minimize the possibility of spills or fires resulting from vandalism or hunting accidents. h. Upon abandonment or expiration of a lease, all facilities must be removed and the sites rehabilitated to the satisfaction of ADF &G and the Director. The departments may determine that it is in the best interest of the public to retain some or all of the facilities. Rehabilitation requirements will be identified in a Habitat Special Area Permit (AS 16.20.060 and/or AS 16.20.530). i. Gravel roads will not be allowed during exploration unless an exception is granted as provided above. J. Public access to, or use of, the leased area may not be restricted except within the immediate vicinity of onshore drill sites, buildings, and other related structures. Areas of restricted access must be identified in the plan of operations. No lease facilities or operations may be located so as to block access to or along navigable and public waters as defined at AS 38.05.965(13) and (17). 21. * Surface entry will be prohibited within one-quarter mile of trumpeter swan nesting sites between April 1 through August 31. The siting of permanent facilities, including roads, material sites, storage areas, powerlines, and above-ground pipelines will be prohibited within one-quarter mile of ) ) Page 8 of 10 known nesting sites. Trumpeter swan nesting sites will be identified by OHMP at the request of the lessee. *Exception - OHMP. 22. Lessees must disclose any requests for exceptions to these mitigation measures and advisories in their plans of operation and applicable permit applications. 23. Plans of operation submitted for review and approval must describe the lessee's efforts to communicate with local communities, and interested local community groups, if any, in the development of such plans. 24. Lessees must submit a plan of operations to the state for approval as required by 11 AAC 83.158. Where surface activities are proposed on non state-owned land, lessees must submit a copy of the plan of operations to the private surface owner. Plans of operation must describe the lessee's efforts to minimize impacts on residential areas and privately-owned surface lands. Lessee Advisories 1. a. Aircraft flying over the primary shorebird habitat within the Susitna Flats SGR, Trading Bay SGR, and Redoubt Bay CHA must maintain a minimum altitude of 1,500 feet above ground level or a horizontal distance of one mile. b. Aircraft flying over the Goose Bay SGR and the Palmer Hay Flats SGR, the primary waterfowl habitat above mean high tide within the Susitna Flats SGR and Trading Bay SGR, and the core Tule goose and trumpeter swan molting and nesting corridors in Trading Bay SGR and Redoubt Bay CHA must maintain a minimum altitude of 1,500 feet above ground level or a horizontal distance of one mile from April 1 to October 31. Human safety will take precedence over this provision. 2. a. Because of the state's interest in encouraging clean air, lessees are encouraged to adopt conservation measures to reduce hydrocarbon emissions. b. The state recognizes that in the long run sources of energy other than oil and gas will be needed. Lessee participation in conducting research on alternative energy sources is appreciated. 3. In populated areas where there is no local planning and zoning, ADNR may require, in approval of plans of operation, that permanent structures be designed to be compatible with the aesthetics of the surrounding area. 4. Bald eagles are protected under the Bald Eagle Protection Act (16 U.S.C. 668-668c) and the Migratory Bird Treaty Act of 1918 (16 U.S.C. 703-712) and are under authority of the U.S. Fish and Wildlife Service (USFWS). Lessees are responsible to ensure their actions do not take bald eagles. The Eagle Protection Act defines "take" to include disturbing birds. Any nests located within Y2-mile of the project site must be mapped, and destruction of nest trees or locations is prohibited. If any nests are located within ~-mile of a project site, Lessees shall meet with the USFWS to review any site-specific concerns regarding the subject nest. USFWS generally recommends no clearing of vegetation within 330 feet of any nest. No activity should occur within 660 feet of any nests between March 1 and June I. Between June 1 and August 31, no activity should occur within 660 feet of active eagle nests until after juvenile birds have fledged, unless specifically authorized by the USFWS. While the USFWS can recommend ways to avoid the take of eagles, final accountability lies with the party responsible for the action. ) ) Page 9 of 10 5. For projects in proximity to areas frequented by bears, lessees are encouraged by OHMP to prepare and implement bear interaction plans to minimize conflicts between bears and humans. These plans could include measures to: (a) minimize attraction of bears to drill sites; (b) organize layout of buildings and work areas to minimize human/bear interactions; (c) warn personnel of bears near or on work sites and the proper procedures to take; (d) if authorized, deter bears from the work site; (e) provide contingencies in the event bears do not leave the site; (t) discuss proper storage and disposal of materials that may be toxic to bears; and (g) provide a systematic record of bears on site and in the immediate area. CONCLUSION Based upon the review of all currently available information, 00&0 considers the Proposed Gas Storage Lease (ADL 390776), with mitigation measures and lessee advisories as described above, consistent with the ACMP. ELEVATION Pursuant to 11 AAC 110.600, a state resource agency, the project applicant, or an affected coastal district that does not concur with this proposed consistency determination may request an elevation of the proposed determination to the department's director or commissioner. The deadline for requesting elevation is 5:00 p.m. Alaska time, August 4, 2005. An elevation may be initiated by submitting a written statement describing the concerns, and the revised proposed alternative(s) that would meet those concerns. For other requirements regarding the written statement see 11 AAC 110.600. Elevations must be filed with the Division of Oil and Gas, 550 W. ih Avenue, Suite 800, Anchorage, Alaska 99501; by fax to 1-907-269-8938, or bye-mail to Jonne_Slemons@dnr.state.ak.us. ) ) Page 10 of 10 Distribution List: Kevin Tabler Susan Lee Ben Greene Kim Kruse Christine Ballard Matt LaCroix Mark Fink Wayne Dolezal Patricia Bettis Kellie Westphal Linda Books Cynthia Espinoza Lydia Miner Stefanie Ludwig Jack Norman Paul L. Craig U nocal Matanuska-Susitna Borough ADNRJOPMP ADNRJOPMP ADNRJOPMP ADNRJOHMP ADF&G ADF&G ADNRJDML W ADNR/DML W ADNRJDML W ADEC ADEC ADNRJSHPO AOGCC Trading Bay Oil & Gas, LLC #16 ·Fwd: [Fwd: Re: [Fwd: Pretty Creek App1icationll-~J(OR contact] ,) ) Subject: [Fwd: [Fwd: Re: [Fwd: Pretty Creek Application]]--DOR contact] From: John Norman <john_norman@admin.state.ak.us> Date: Wed, 27 Jul2005 17:19:13 -0800 To: Jody J Colombie <jody _ colombie@admin.state.ak.us> print for file -------- Original Message -------- Subject:[Fwd: Re: [Fwd: Pretty Creek Application]]--DOR contact Date: Wed, 20 Jul 2005 11: 13 :26 -0800 From:Thomas Maunder <tom. Inaunder~admin.state.ak.us> Organization:State of Alaska To:John Norman <john nOrIllan(â¿admin.state.ak.us>, Daniel T Seamount JR <dan sean10unt~adlnin.state.ak. us>, Catherine P Foerster <cathy foerster(â¿adlnin. state.ak. us> CC:Jody J Colombie <iody colombie@admin.state.ak.us>, Steve Davies <steve davies(â¿adnlin.state.ak.us>, John D Hartz <jack hartz(â¿adlnin.state.ak.us>, Robert Mintz <robert mintz@law.state.ak.us> All, Here is the message trail regarding a request from the Department of Revenue regarding a meeting and requesting a copy ofUnocal's Pretty Creek Gas Storage application. Ms. Jenny Rogers and Mr. Gary Rogers, CPA (Revenue Audit Supervisor II) came over this morning at 10 and I met with them. Neither Jack or Steve were available. Their interest is in storage in general and how gas stored should be treated for tax considerations. Pretty Creek is the first storage operation planned involving state leases and these tax concerns were not addressed or not involved (I am not sure which) when the Swanson Storage operations were begun. Apparently there are tax allowances/deductions applicable to gas injection used for enhanced recovery and Unocal may be pursuing attempts to claim such for this project. In particular for doing gas storage, Unocal has apparently advanced the argument that with storage available they won't have to SI wells which avoids the potential to damage a well's producibility. They asked if this was so. I commented that some well performance has been known to be affected by shutting in (some platform oil wells when Redoubt erupted), but that I had not heard of that "problem" with south Alaska gas wells. I stated that it all depended on the production characteristics of a given well and what fluids (gas and water) were being produced. If such were believed to be the case, production records for a particular could be examined to determine if such an effect could be identified for operations in the past years. They also asked if "all" the gas that might be injected into Pretty Creek would likely be recovered. I said that it was likely particularly for the lower proposed storage sand since the production behavior showed that sand behaving as a volumetric reservoir. Injection and then production should follow the "P over Z line" between the starting and end pressures. I mentioned that annual reports were available for the Swanson Storage operations and that I believed P over Z plots were included that demonstrated recovery of the gas injected. Ms. Rogers confirmed that what information she had examined indicated that to be the 1 of3 7/28/2005 9: 14 AM Fwd: [Fwd: Re: [Fwd: Pretty Creek Application ll-.::DOR contact] ) ) case. With regard to the upper proposed sand, I said I was not certain due to that zone having produced water and that analysis by our team reservoir engineer would be needed to assess how recovery of any stored gas in that zone might be affected. As the meeting ended, they requested a copy ofUnocal's June 20, 2005 application which I provided. Mr. Rodgers also requested to be added to our public notice list. They departed about 10:25. Tom Maunder -------- Original Message -------- Subject:Re: [Fwd: Pretty Creek Application] Date:Wed, 20 Jul2005 08:23:50 -0800 From:Thomas Maunder <tommaunder~admin.state.ak. us> Organization:State of Alaska To:Jenny Rogers ~jenny rogers~revenue.state.ak.us> References:<00040 1 c5 8d46$dd7 de650$5bOaOaOa~dor.ak.local> Jenny, 10 will work fine. I am part of the "West Team" which handles CI offshore and the West Side. My teammates are Jack Hartz (Sr. Reservoir Engineer) and Steve Davies (Geologist). Together we will try to get an answer to what questions you might have. See you at 10. Tom Maunder Jenny Rogers wrote: Thank you, Tom. I'll come over around 10 o'clock, if that's convenient for you. Just for future reference, are you the Cook Inlet "expert"? As we sort through the tax implications of the gas storage situation, we might have more questions for the AOGCC. Our concerns are a little different than the royalty folks' issues at DNR. Thanks again and I'll see you around 10. Jenny -----Original Message----- From: Thomas Maunder [mailto:tom maunder@admin.state.ak.us] Sent: Tuesday, July 19, 2005 4:35 PM To: Jenny L Rogers Cc: Jane Williamson; John 0 Hartz Subject: Re: [Fwd: Pretty Creek Application] Jenny, You are welcome to come over and look at the application. You may also 2 of 3 7/28/2005 9: 14 AM Fwd: [Fwd: Re: [Fwd: Pretty Creek Applicationll--DOR contact] ) ) get a copy if you'd like. FYI, DNR also has a public notice going regarding the storage lease. The documents they sent out have a copy of the original storage application in it, but after our initial review Unocal it was necessary for Unocal to provide a revised application. Have Linda at the front desk contact either Jane or myself when you come over. Tom Maunder, PE AOGCC Jane Williamson wrote: Can you help Jenny? -------- Original Message -------- Pretty Creek Application Tue, 19 Jul 2005 16:18:36 -0800 Jenny Rogers <jenny rogers@revenue.state.ak.us> , J an e Will i ams 0 n' ,::::j.."?..0._~..........~,~..,~",.~...~"9.,~"§..?.0.,~...§.1:..9.~..~.0...,:....:?,,~..§...~..§.",:....?:..~..,:....~..:??:, Subject: Date: From: To: Jane, Is it possible for Department of Revenue to obtain a copy of Unocal's application for a storage injection order at Pretty Creek? I understand that the Commission's order will be public, but we're interested in reviewing the application. If you can't provide a copy of the application, might it be possible for us to review it at your offices? Thank you for your help. Jenny Rogers 269-1015 John K. Norman <John Nonnan(á¿admin.state.us> Commissioner Alaska Oil & Gas Conservation Commission 30f3 7/28/2005 9: 14 AM #15 FROM: ) ) This morning I convened the hearing on Unocal's May 10th, 2005, application for a storage order for the Pretty Creek Gas Storage Facility. Unocal had previously requested a continuance and, therefore, at the start of the hearing I announced that it would be my intention to recess and reconvene at 9:00 o'clock a.m. on August 10th, 2005, to continue the Pretty Creek hearing. I also referenced the fact that Cook Inlet Keeper had filed public comments, but did not request a hearing. We will consider the public comments of Cook Inlet Keeper at the time we act on the application. Of additional significance is the fact that Trading Bay Oil & Gas, LLC, filed a request for a hearing. Special Assistant has notified Trading Bay Oil & Gas of our intention to reconvene the hearing on August 10th, 2005, and I am asking the Special Assistant to also either bye-mail or letter, confirm to Unocal, Trading Bay Oil & Gas and Cook Inlet Keeper, even though they did not request a hearing, that we convened the hearing and at request of the applicant it has been continued to August 10th, 2005. A carbon copy of this should be sent to the State of Alaska, Department of Natural Resources, Division of Oil & Gas, a CC of the letter. In reviewing the file I note that there is pending a gas storage lease application, which was filed with the Division of Oil & Gas that was filed on June 24th, 2005. The estimated date of lease award is September 9th, 2005. When we take action on this matter at the time the hearing reconvenes, it will be important to ensure that any action by this agency approving the application .is ..tl-- conditioned upon issuance of a gas slora~e le'ase bv the Division of Oil & Gas. J \ MEMORANDUM STATE OF ALASKA ALASKA OIL AND GAS CONSERV A TION COMMISSION TO: f"\ Mer.ö tc File DATE: July 26, 2005 SUBJECT: Storage Injection Hearing \,. ~ I J)0.Jµ ^ çl/ 0 '\ 'l/~/· ~c. ) '\, 1. Like to call this hearing to order Date: Time: Located: July 26, 2005 Approximately 9:00 am 333 W. 7th Ave., Ste 100, Anchorage, Alaska Offices of the Alaska Oil and Gas Conservation Commission 2. Introduce the bench . Two Commissioners >- John Norman Chairman >- Daniel Seamount Commissioner >- Cathy Foerster, Commissioner . Susie ofR&R reporting making transcript of proceedings Can get copy from R&R court reporting. Purpose- Alaska Oil and Gas Conservation Commission's Unocal request for a storage injection order for Pretty Creek Gas Storage Facility. On June 20, 2005 Unocal provided the surface owners/operators a copy of the permit application. Hearing Notice of duly published on June 24, 2005 in Anchorage Daily News. ~On June 27, 2005 Cook Inlet Keeper filed public comments but did not request a hearing. Trading Bay Oil and Gas, LLC filed a request for a , _ C\ hearing on July 11, 2005. ----- vý 3. Proceedings held in accordance wI 20AAC 25.540- regulations ~" governing public hearings. ~ Q~ ~~ 4. Hearing will be recorded. Unocal has requested a continuance until August 10, 2005 at 9:00 am 5. Appropriate to go ahead and ~he meeting ;:) ~~ -\&(2 7~ ~ f 1'0 / ,- ~ #14 ) 10 11 12 ) 1 ) ) Before Commissioners: ALASKA OIL AND GAS CONSERVATION COMMISSION 2 3 4 5 In the Matter of UNOCAL for Order, Pretty Facility 6 7 John K. Norman, Chairman Daniel T. Seamount Cathy Foerster of the Application ) a Storage Injection) Creek Gas Storage ) ) ) 8 ALASKA OIL and GAS CONSERVATION COMMISSION Anchorage, Alaska 9 BEFORE: 13 14 15 16 17 18 19 20 21 22 23 24 25 July 26, 2005 9:05 o'clock a.m. VOLUME I PUBLIC HEARING John K. Norman, Chair ) ) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 ) TABLE OF CONTENTS Remarks by Chair Norman . . . . . . . . . ) ........ . 03 ) 1 2 3 4 5 6 7 8 9 10 11 12 ) 13 14 15 16 17 18 19 20 21 22 23 24 25 ~ , ) ) PRO C E E DIN G S Tape 1 0015 (On record - 9:05 a.m.) CHAIR NORMAN: Good morning. I will call this hearing to order. This is a hearing before the Alaska oil & Gas Conservation commission. The purpose of the hearing is to consider an application for a storage injection order for the Pretty Creek Gas storage Facility. The application is presented by Unocal. And presently in attendance this morning is John Norman, Chairman of the Commission. I'll indicate right now preliminarily that the applicant has requested for convenience of the applicant that the hearing be continued, and we have set a new date. Therefore, although we do not have a quorum I will proceed to state the purpose of the hearing and then it will be my intention to recess to the new date. A transcript is made of these proceedings and of the proceedings when we recess and reconvene. Any persons desiring a copy of that can get a copy from R & R Court Reporting. The file reflects that the application was filed on May 10th, 2005. A hearing notice of these proceedings was duly published in the Anchorage Daily News on June 24th, 2005. There is an affidavit of publication on the file. Any persons desiring to see a copy of that may obtain one from the commission's special assistant, Jody Colombie. Additionally, the file reflects that the applicant, 3 ~ ) 1 2 3 4 5 6 7 8 9 10 11 12 ) 13 14 15 16 17 18 19 20 21 22 23 24 25 ~ ) ) Unocal, provided notice as required by the regulations to surface owners within the requisite distance from the proposed injection area. On June 27th, 2005, the organization, Cook Inlet Keeper, filed public comments, but in their public comments they specifically stated that they were not requesting a hearing. We will, of course, take those public comments into consideration in any action taken by the Commission in this matter. On July 11th, 2005, Trading Bay oil & Gas, LLC, and LLC meaning Limited Liability Company, filed a request for a hearing, and this hearing is being conducted and going forward pursuant to that formal request. These proceedings are held in accordance with 20 AAC section 25.540 of the regulations of the Alaska oil & Gas Conservation commission governing hearings of this nature. The party that requested the hearing, Trading Bay oil & Gas, LLC, has been notified of our intention to continue the hearing to August 10th as requested by the applicant. Accordingly, they were told that they need not appear and attend today because the purpose would be to simply state the purpose of the hearing and give public notice in this forum that the hearing is going to be recessed to be reconvened at the time when both the applicant, Unocal, and the party requesting the hearing, Trading Bay oil & Gas, LLC, can be present. We do have certain members of the staff present today. And before I recess and announce the reconvening I will just 4 ) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 ) ) ) ) briefly ask, it's not necessary that they comment, but I will ask them if there is anything that they think should be stated in the public record before I recess. You may take your time to review. MR. DAVIES: There is Steve Davies, there is one ma t ter. . . . . (Off record comments re microphone) MR. DAVIES: My name is Steve Davies. I'm a geologist here at the Alaska oil & Gas Conservation commission. I'd just like to mention that there was one issue that was mentioned by the Department of Natural Resources. And that is the fact that there is not a storage injection lease agreement in effect for that particular lease, the affected lease, at this time. So that's one issue that the Commission will need to consider as we decide the timing of any decision that we'd make on this matter. CHAIR NORMAN: Very good. Thank you, Mr. Davies, for that comment. Correct me if I'm wrong then, but these are State of Alaska oil and gas leases, is that correct, all of them..... MR. DAVIES: That's correct. CHAIR NORMAN .....the area here. And what the State of Alaska is saying is that these are oil and gas leases but the leases were not issued for the purpose of allowing storage. They were issued for the purpose of allowing the lessee to explore for and produce oil and gas. Consequently, the State is pointing out that before it would be appropriate to grant this as the owner of the subsurface there should be a subsurface storage agreement in place? 5 ) . , ) ) 1 MR. DAVIES: That's correct. 2 CHAIR NORMAN: Good. Thank you for identifying that 3 issue. I would like to ask staff if they would contact Unocal 4 and advise them of that communication and tell them that before 5 the Commission would be able to approve this we need to know 6 that they do have tenure of the area that they're proposing to 7 inject the gas into for this particular purpose? 8 MR. DAVIES: Yes, sir, we'll notify Unocal. 9 CHAIR NORMAN: Thank you. 10 MR. MAUNDER: My name is Tom Maunder. I'm one of the 11 petroleum engineers at the Commission. commissioner Norman, 12 further to the issue of the lease, the Department of Natural ) 13 Resources does presently have a matter out for public comment 14 for this storage lease. I believe we have a copy in the record 15 that on June 24th they made their notice and if I remember the 16 time line correctly allowing for potential appeals, that the 17 storage lease issue could be determined sometime around 18 September 9th. 19 CHAIR NORMAN: Yes, thank you, Mr. Maunder. As we've been 20 talking I'm now focused on this. And I do see that their 21 proposed time table, the deadline for comments was July 25th. 22 Their proposed determination is August 8th. A written finding 23 they are estimating would be ready by August 15th. The end of 24 the appeal period upon that would run on September 6th, 2005, 25 and the lease would be awarded on September 9th, 2005, ) according to that projected time table. So it does appear that everything is in order. And seeing this then what I would anticipate is the Commission could proceed at the August 10th 6 ) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 ') ) ) ) hearing to receive the testimony, make our own decision, and one condition, of course, would be that they obtain the lease, but aside from that I think my earlier comment about Notifying Unocal it appears like that has been attended to, so..... Is there anything else? Okay. I thank you for those comments. And at this point then I am going to recess these proceedings and announce that we will reconvene at 9:00 o'clock a.m. on the morning of August 10th, 2005, in these chambers. We are recessed. (Recessed - 9:15 a.m.) 0240 7 ) 1 2 3 4 5 6 7 8 9 10 11 12 ) 13 14 15 16 17 18 19 20 21 22 23 24 25 ) ') ) C E R T I F I CAT E UNITED STATES OF AMERICA ) ) ss. STATE OF ALASKA ) I, Rebecca Nelms, Notary Public in and for the State of Alaska, residing at Anchorage, Alaska, and Reporter for R & R Court Reporters, Inc., do hereby certify: THAT the annexed and foregoing Public Hearing, Volume I, held on July 26th, 2005 was taken by Suzan K. Olson, commencing at the hour of 9:05 o'clock a.m, at the Alaska Oil and Gas Conservation commission of Alaska in Anchorage, Alaska; THAT this Transcript, as heretofore annexed, is a true and correct transcription of the proceedings taken and transcribed by Suzan Olson. IN WITNESS WHEREOF, I have hereunto set my hand and affixed my seal this 26th day of July, 2005. ,.....,~) {'¡ \.:.~~~ . .~ Notary PubllC ln and for Alaska My Commission Expires:10/10/06 ') ) STATE OF ALASKA OIL AND GAS CONSERVATION COMMISSION Pretty Creek Gas Storage Injection Hearing July 25, 2005 9:00 AM NAME - AFFILIATION ADDRESS/PHONE NUMBER (PLEASE PRINT) L W¡/e f)fJl//é~ I --¡(;//7 /fol//17é'r J O()CC~ iJ-O~Cr: TESTIFY (Yes or No) y f #13 le: Pretty Creek Storage Public Notice ) ') Subject: Re: Pretty Creek Storage Public Notice From: Jody Colombie <jody _ colombie@admin.state.ak.us> Date: Thu, 14 Jul2005 08:57:01 -0800 To:"SI11et~nka,?effW"<smetankaj@unoca1.c011l> ". . '. '.', .,..>',< ee,: Th911lasMé:lurider 6tom J11~under@adtIlitl. sjctte.aku$>, St~yepa.yi~s I' '. '.'. ,':i<"" )' '...',..'" <steve~4ayjes@~4min.state.ak~us> ,"H~z, J0ll11I?'-~QG,CC "<jaqk_h'1tt~(@acllIlirl.staie.~.~s>, ".Sh,.an, .', . ,n,".."b,n. ".C,',' 0', ,,',l.,.e., ~,n" ",..e, " ." <. .. C~l1, ann", 0..' n@uno,c,."'.,a,1.co,.,m.,>,',IIT..'a.' b,ler,,: W"eY.i.n, ,', A. ',',t".<.'.t"åÞ"k~"rk,."'" @, ' .' :un,'.,'.' ,., '.,',..0" ,...c,'",.,al.'.,·.com..,'. >,"'"",','.'.':W. I h,',i,tacre,',., Daye .S" <whita~r~d'@unQcaLcOm>, III)élfk~ah,S,amuelA;"fdar~wGth~@U#~þal.c()~~,"Sl1lli"an'F~ye " V{'~ <sullifw@unoça1.c011»,"Lambe,StevenS" <larobes@unoca1.com> ' " , Jeff, Just a confirmation of our phone call last night. Unocal willI not be at the continuance hearing set for July 26th at 9:00 am. At the short hearing the Chairman will continue the hearing until August 10th at 9:00 am. Jody Colombie Special Staff Assistant Smetanka, Jeff W wrote: Tom, I received your phone message indicating that a public call has been made for a hearing. As we discussed last week, we have a conflict with the original hearing date of July 26 and would like to defer the meeting to the August 10th date. Thank you, Jeff From: Thomas Maunder [mailto:tom maunder@admin.state.ak.us] Sent: Thursday, July 07, 2005 4:06 PM To: Smetanka, Jeff W Cc: Jody J Colombie; Steve Davies; Hartz, John D -AOGCC Subject: Re: Pretty Creek Storage Public Notice Jeff, To close the loop after our call this morning... 1. Thus far, no member of the public has made a request for a public hearing. A request may be made up to 1630 on Monday July 11. The Commissioners may detennine that a hearing is desired for this matter. At this time, I do not know how the Commissioners feel with regard to a hearing. 2. In order to avoid the expense of having to renotice the hearing, if there is a conflict it is possible to go on record at the current time specified and "move" the hearing to a later date. On Tuesday, we will at least know if someone in the public has requested a hearing. lof2 7/14/2005 8:57 AM ~e: Pretty Creek Storage Public Notice ) '\ ) Call or message with any questions. Tom Maunder, PE AOGCC Smetanka, Jeff W wrote: Tom, Do you know if there have been any requests for the public hearing for our Pretty Creek Storage project? I may have a conflict with the tentative July 26 hearing date and wanted to find out what you've heard on this. In the event that a hearing will be held, what other dates do you have available? Thanks, Jeff From: Thomas Maunder [mailto:tom maunder@admin.state.ak.us] Sent: Wednesday, May 18, 2005 4:30 PM To: Smetanka, Jeff W Cc: Hartz, John D -AOGCC; Steve Davies; Jody J Colombie Subject: Re: Pretty Creek Storage Application Thanks Jeff. We will hold "noticing" until we have received the corrected document. Tom Maunder, PE AOGCC Smetanka, JeffW wrote: Tom, As we discussed today, we realize now that we have several errors in our Pretty Creek Storage application. We are working at this time to correct those errors and provide the additional information that you requested. To ensure that everything is in order before this goes out to the public, we request that the AOGCC temporarily hold off on putting this out to public notice. We hope to resolve all these issues soon. I will contact you when the revised report is complete and we are ready to resume the process. Thank you, Jeff Smetanka 263-7622 ~ of2 7/14/2005 8:57 AM #12 1¡;DNR comment on Application for Pretty Cre~k Stnr)ge Injection Order ) Subject: ADNR comment on Application for Pretty Creek Storage Injection Order From: Brian Havelock <brian_havelock@dnr.state.ak.us> Date: Tue, 12 Jul2005 10:46:33 -0800 To: Stev~Davies <st~ve__davies@admin.state.ak.us>, 'JodyColombie'. .·'i" <jody _colombie~admin.state.ak. us>". 'Thomas· Maunder' <tom_ Il.1aun4er@adIllil1;state.ak:.us> CC: Jim C?wan<jim_cowan@dnr.state.ak.us?,bill~ van_d¥ke@~nr.state.ak;us, "Piql~(Pirll~)" <pirt~e ~bates@?dnr;'stat~¡ak. us>,'tisa Kirsch'· <lisa Jdrscli@la~~state.ak;~s>\ k~"\,illtaþler <tablerk@unocal.co111>, "MikeK (MikeK)"<mike_kotowski@dnr.state~éÙ\.~us~' ' July 12, 2005 Commissioners, On June 22, 2005, the Division of Oil & Gas received the Revised Application for Storage Order for Pretty Creek Gas Storage Facility dated June 20, 2005, submitted by Union Oil Company of California (Unocal) to the AOGCC. The Division also received on May 13, 2005 from Unocal an application to ADNR for a Gas Storage Lease under AS 38.05.180(u), which is currently under review. At the earliest date, a storage lease may be issued September 9,2005. Unocal is not authorized by ADNR to inject or withdraw non-native gas at Pretty Creek prior to issuance of the storage lease. The Division has no other comment on the proposed Storage Order at this time, but wishes to reserve the right to comment before any injection or withdraw operations are finally approved by the Commission. If you have any questions, please contact Brian Havelock at 269-8807. Thank You. Brian Havelock Natural Resources Specialist Division of Oil & Gas Alaska Department of Natural Resources 550 West 7th Avenue, Suite 800 Anchorage, Alaska 99501 http://www.dog.dnr.state.ak.us 1 of 1 7/12/2005 12:56 PM #11 ££ ~~ £~-~~ r~UITI:rMUL "'1-\ .1 Lr t"' HU lU:~Ø?7 ) 1 1 PAGE 1/2 y' Trading Bay Oil & Gas, LLC 5432 E. Northel~n Lights, #610 Ancho.,.age~ AK 99508 PhQ1te (907) 278-7489 Fax (907) 274-8211 Jtùy 11; 2005 To: ~~::n~OGCcø¿~ From: Paul L. Craig . Manager, Tradi ay il as7 LL Re: The application of Union Oil Com y of California e'Unocal") for a Storage Inj ection Order authorizing the erground storage of natural gas by injection into the Beluga and Sterling Formations in the Pretty Creek #4 well, Pretty Creek Undefined Gas Pool Cook Inlet Area~ Alaska. Pursuant to the June 24, 2005 notice of public hearing regarding Unocal's application to inject natural gas into zones penetrated by the Pretty Creek #4 well, Tradíng Bay Oil & Gas, LLC hereby requests that the public hearing be held on July 26,2005 at 9:00 am at the Alaska on and Gas Conservation Commis$Ïon. Trading Bay Oil and Gas, LLC owns leases contiguous with the north boundary of the Pretty Creek Unit. It is therefore an interested party relative to correlative rights and/or encroachment upon operations on its leases to the north. Delivered via fax: (907-276-7542) Attaclunent: Notice of Public Hearing dated June 247 2005 RE:CEjVED !ì J! 1 "1 Î DOS .,........ '- _l ...1. - .,.. ,~j;U;(3 ûH ,~ G3S Gon¡;. Cwmmi5Sio¡; Am-;hof¡)99 JUL-11-0S 14:30 FROM:PAUL )AIG PHD ID:907~ )11 Notice of Public Hearing STATE OF ALASKA Alaska on and Gas Conservation Commission Re: The application of Union Oil Company of California ("Unocal") for a Storage Injection Order authorizing the underground storage of natural gas by injection into the Beluga and SterIíng Formations in the Pretty Creek #4 well, Pretty Creek Undefined Gas Pool Cook Inlet Area~ Alaska. Union on COlnpany of California ("Unocal") by letter dated June 20, 2005, has applied for an injection order authorizing the underground storage of natural ga$ in the Beluga and Sterling Formations at Pretty Creek #4 well in accorda.nce with 20 MC 25-252. The Pretty Creek #4 wel1 is located in Section 33~ Township 14 N, Range 9 W7 SM. The Beluga forma.tion occurs at an approximate depth of 3600' SS and the Sterling formation occurs at an a.pproximate depth of3200) ss. The Commission has tentatively set a public hearing on this applicatíon for July 26, 2005 at 9:00 at.I.1 at the Alaska Oil and Gas Conservatíon Commission at 333 W cst 7th. Avenue, Suite 100, Anchorage~ Alaska 99501. A person may request that the, tentative hearing be held by fi 1 ing a written request with the Commission no later than 4 :30 pm on July 11, 2005. 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 7th Avenue.. Suite 100, Anchorage~ Alaska 99501. Written comments must be received no later than 4:30 pm on July 25, 2005, except that if the Conunission decides to hold a public hearing, written comments must be received no later than 9:00 am on July 26, 2005. \ If you are a person vvith a disability who may need a specíal accommodation in order to comment or to attend the public hearing, please contact Jody Colombíe at 793- 1221 before July 20, 2005. John Norman Chairn1an Publish¢d Date: June 24, 2005 ADN AO# 02514039 PAGE 2/2 ) ,) ~OILÆNb Æ~~?\\ \ /. /...1.'.'.... ~ , ~~'-~"".~ 'iI" ',1 [, ,ç7 iii' ~ . . ''''''~J Q ~. ,";~;t."":'>". ~ ~ ..... ·"i.,::.,, . :S? ~~ .,~~~ "~~TI0N co~/ Alaska Oil and Gas Conservation Commission 333 West 7th Avenue, Suite 100 Anchorage, AK 99501-3539 Phone: (907) 279-1433 Fax: (907) 276-7542 Fax Transmission The information contained in this fax is confidential and/or privileged. This fax is intended to be reviewed initially by only the individual named below. If the reader of this transmittal page is not the intended recipient or a representative of the intended recipient, you are hereby notified' that any review, dissemination or copying of this fax or the information contained herein is prohibited. If you have received this fax in error, please immediately notify the sender by telephone and return this fax to the sender at the above address. Thank you. To: ,-\<è..çÇS~~",~ \J"E) <:..ú..,\ \õ~ \-\.(J..~~ <tr Fax #: d(q ~ - "ì <2; '-\ '\ From: Date: ~ -..) \'i \ ") \ ;}ð () Ç" Phone #: Subject: ~ ~~ (~\L. ~c....\'\......~ Pages (including cover sheet): J.-- Message: J Cc.Ç.~ \ ~rc. \~ \k "'~û..r'\~~\-'-.J~-\-~M.. \~~r--~ &'-( 0-\ \ ~ GO-s L\..--~ n:.~(),J)'ì""-~ +~ ~ffire...~ ::CY'-jCcC-\-tÐr-O~\\ ~\ '?'\tt;~(C.R-{, ~,T\ru-$- 1'é)\-\"c..\.~t.rJ--- -t~ c&~'f O~~(Ç ~O-\.'ìc..~ . ~ryv¡~ u...---\cg'f ~ \Ð~b \K If you do not receive all the pages or have any problems with this fax, please call for assistance at (907) 793-1223. DATE, TIME FAX NO./NAME DURATION PAGE(S) RESULT MODE ) JOB STATUS REPORT 07/12 08:20 2637847 00:00:28 02 OK STANDARD ECM TIME NAME FAX# TEL# SER.# ) 07/12/2005 08:21 AOGCC 9072767542 BR02J2502370 #10 Re: Pretty Creek Storage Public Notice ') ') Subject: Re: Pretty Creek Storage Public Notice From: Thomas Maunder <tom _ maunder@admin.state.ak.us> Date: Thu, 07 Jul2005 16:06:02 -0800 T 0: "Smetanka,J eff W" <smetankaJ@unocaLcom> CC: lody J Colömbie<jody _colombie@admin.state.ak.us>, Steve Davies <steve_davies@admin;state.ak.us>, John DHart;z <jack_hartz@admin.state.ak.us> Jeff, To close the loop after our call this morning... 1. Thus far, no member of the public has made a request for a public hearing. A request may be made up to 1630 on Monday July 11. The Commissioners may determine that a hearing is desired for this matter. At this time, I do not know how the Commissioners feel with regard to a hearing. 2. In order to avoid the expense of having to renotice the hearing, if there is a conflict it is possible to go on record at the current time specified and "move" the hearing to a later date. On Tuesday, we will at least know if someone in the public has requested a hearing. Call or message with any questions. Tom Maunder, PE AOGCC Smetanka, Jeff W wrote: Tom, Do you know if there have been any requests for the public hearing for our Pretty Creek Storage project? I may have a conflict with the tentative July 26 hearing date and wanted to find out what you've heard on this. In the event that a hearing will be held, what other dates do you have available? Thanks, Jeff From: Thomas Maunder (mailto:tom maunder@admin.state.ak.us] Sent: Wednesday, May 18, 2005 4:30 PM To: Smetanka, Jeff W Cc: Hartz, John D -AOGCC; Steve Davies; Jody J Colombie Subject: Re: Pretty Creek Storage Application Thanks Jeff. We will hold "noticing" until we have received the corrected document. Tom Maunder, PE AOGCC Smetanka, JeffW wrote: Tom, 1 of2 7/11/20052:08 PM ~e: Pretty Creek Storage Public Notice ') ) As we discussed today, we realize now that we have several errors in our Pretty Creek Storage application. We are working at this time to correct those errors and provide the additional information that you requested. To ensure that everything is in order before this goes out to the public, we request that the AOGCC temporarily hold off on putting this out to public notice. We hope to resolve all these issues soon. I will contact you when the revised report is complete and we are ready to resume the process. Thank you, Jeff Smetanka 263-7622 20f2 7/11/2005 2:08 PM #9 ) ) Protecting Alaska's Cook Inlet watershed and the life it sustains June 27,2005 J Ohl1 N onnan, Chain11an Alaska Oil and Gas Conservation COll1lnission 333 West ih Avenue, Suite 100 Anchorage, AK 99501 ECE;VE JUN 2 9 Z005 t~U~S~{~ Oi~ & 1[;¡J,s Cm~;¡;. Dear Chairman N annan: Cook Inlet Keeper (Keeper), a non-profit conservation organization whose mission is to protect Alaska's Cook Inlet watershed and the life it sustains, is writing you about Unocal's application for a Storage Injection Order to inject natural gas into the Beluga and Sterling Fonnations in the Pretty Creek #4 well, Pretty Creek Undefined Gas Pool Cook Inlet Area, AI~eeper is not opposed to storage of natural gas per se, however we are opposed to storage in sensitive habi at i ing so will extend the life of industrial operations in sensitive habitat beyond the time period for oil and/or gas uction. As you know, this proposed storage will occur in the Susitna Flats State Game Refuge, a protected area and sensitive habitat for wildlife. As Keeper stated in its March 15,2005 letter to the Robin West of the U.S. Fish and Wildlife Service regarding potential storage of gas by Unocal in the Kenai National Wildlife Refuge (NWR),"[t]he proposed [storage] project will likely materially interfere with and detract from the purposes of [the] Kenai NWR and the mission of the refuge system." This statement also applies to the state refuge system, including the Susitna Flats State Game Refuge. As a result, Keeper respectfully requests that AOGCC place a time limit on these proposed storage operations, i.e., that they will not extend beyond the operating life of the gas pool's production operations. Additionally, Keeper would like to bring to AOGCC's attention other ways for Unocal and other southcentral Alaska gas producers to address forecasted seasonal deliverability demand, also known as "peak" demand. The following alternatives to storage in sensitive habitats are possible: 1. Unocal can utilize storage capacity in oil and gas fields located in non-protected lands in the region that are connected to southcentral Alaska's natural gas pipeline infrastructure, 2. Unocal can construct Liquified Natural Gas (LNG) "peak shaving" gas storage facilities utilizing LNG from the ConocoPhillips plant in Nikiski, and/or 3. Enstar, southcentral Alaska's primary natural gas supplier, can set up "interruptible supply contracts" with industrial gas users to give them financial incentives not to use gas at times of peak demand, and/or Enstar can provide financial incentives for residential consumers not to use gas at peak times. :T;.¡ Cook Inlet Keeper is .ug¡ requesting a public hearing on Unocal' s application for gas storage, however we would ~ . ...... C, appreciate notificatioñ'i'r AOGCC decides to hold a hearing on this application. - · ..q . Thank you very much for your attention to our comments. Sincerely, èY'crYo (!. ~- Lois N. Epstein, P.E. Senior Engineer ( r~7ô I 308 G Street, Suite 219, Anchorage, Alaska 99501 · Phone: (907) 929-9371 · Fax: (907) 929-1562 www.inletkeeper.org #8 {e: Public Notice Storage Injection Notice (Prettv r"jk) Subject: Re: Public Notice Storage Injection Notice (Pretty Creek) From: lody Colombie <jody_colombie@admin.state.ak.us> Date: Thu, 23 lun 2005 15 :26:59 -0800 To:··lois@inletkeeper.org Lois, It is our understanding that the Pretty Creek Storage well is located within the Susitna Flats State Game refuge. To verify this we would refer you to the status plats of Division of Mining, Land and Water. If I can be of further assistance please call or e-mail me. Jody Colombie Special Staff Assistant Lois Epstein wrote: Jody - Hi. Is there any way you can find out if this well is in the Susitna Flats State Game Refuge? DNR hasn't been able to confirm that (surprisingly). Thanks. Lois Lois N. Epstein, P.E. Senior Engineer Oil and Gas Industry Specialist Cook Inlet Keeper (Anchorage Office) 308 G St., Suite 219 Anchorage, Alaska 99501 ph: 907 929-9371 fx: 907 929-1562 lois@inletkeeper.org 1995-2005: Ten years protecting Alaska's Cook Inlet watershed & the life it sustains -----Original Message----- From: Jody Colombie [mailto::jody colombie@admin.state.ak.us] Sent: Thursday, June 23, 2005 12:05 PM To: undisclosed-recipients: Subject: Public Notice Storage Injection Notice (Pretty Creek) NOD32 1.1152 (20050623) Information This message was checked by NOD32 antivirus system. http://www.eset.com 1 of 1 6/23/2005 3 :27 PM #7 @~&~~ ~J &~@~ DIVISION OF OIL & GAS FRANK H. MURKOWSKI, GOVERNOR DEPARTMENT OF NATURAL RESOURCES 550 WEST 7TH AVENUE, SUITE 800 ANCHORAGE, ALASKA 99501-3560 PHONE: (907) 269-8800 FAX: (907) 269-8938 r:;~t~ /~ r-~" " r''\, ~ 1/-0,",."" .,: i., !< rr= ~ ",-", \V I~ íi' ~" I;' I"'" ..."...~.\,; t:' !.¡-'''''~~ June 24, 2005 Jl1N 2 S 2005 ß;ash~ Oil:? ¡-'..,- C ,..... '-~ l:::c~, fìm~. Camr:,;;'\sl';",,-; To: See Distribution List Re: Start of ACMP Review of Gas Storage Lease Application (ADL 390776) Reviewers: The Division of Oil and Gas (DO&G) has received an application for a Gas Storage Lease from Union Oil Company of California (Unocal). Unocal applied for the lease under AS 38.05.180(u). DO&G will coordinate the consistency review. The proposed action is more completely described in the attached public notice. Notice was published in the Anchorage Daily News, Peninsula Clarion and the Frontiersman, posted to the State's public notice web site (http://notes.state.ak.us/pn/pubnotic.nsf) and sent to the Postmasters in the vicinity of the applied for areas for public display. A mailout was also conducted to parties on DO&G's Cook Inlet Lease Sale mailing list, Agrium, and southcentral public utilities. Review Schedule The DO&G will coordinate this as a 50 day consistency review under 11 AAC 110. The deadlines for this review are: Public Notice and Start Review Requests for Additional Information deadline Comment deadline Proposed Consistency Determination issued Final Consistency Determination and Written Finding under AS 38.05.035(e) End of Appeal/Reconsideration Period for Written Finding under AS 38.05.035(e) and Effective Date of Decision Lease Awarded June 24, 2005 July 19, 2005 July 25, 2005 August 8, 2005 August 15, 2005 September 6, 2005 September 9,2005 "Develop, Conserve, and Enhance Natural Resources for Present and Future Alaskans. " 06/24/05 Gas Storage Lease ACMP REVIEW LETTER - UNOCAL ADL 390776.doc Page 2 of3 ) .', ) Review participants will evaluate these proposed leases for consistency with the standards and policies of the Matanuska-Susitna Coastal Management District, and the State of Alaska. All comments from reviewers must be received by the DO&G before 5:00 p.m. on July 25, 2005, at: Director, Division of Oil and Gas 550 West 7th Avenue, Suite 800 Anchorage, AK 99501-3560 The proposed consistency determination will include proposed lease mitigating measures. Elevation DO&G must receive any request for elevation of the proposed consistency determination to the Commissioner within five (5) days of the issuance of the proposed consistency determination. The applicant, State Resource Agencies, and the Matanuska-Susitna Borough Coastal Management District have elevation rights. FOR MORE INFORMATION CONTACT: Jonne Slemons, Natural Resource Specialist Division of Oil and Gas 550 West ih Avenue, Suite 800 ~chorage,AJ( 99501-3560 Phone: (907) 269-8806 E-mail: Jonne_Slemons@dnr.state.ak.us Fax: (907) 269-8943 Sincerely, PÇx!-&y>'~ Jonne Slemons Natural Resource Specialist V Enclosures: 1) Copy of Application 2) Copy of Mailout 3) Public Notice Distribution: ( ( 06/24/05 Gas Storage Lease ACMP REVIEW LETTER - UNOCAL ADL 390776.doc Page 3 of3 Susan Lee, Matanuska-Susitna Borough Ben Greene, JPO Kim Kruse, DNR, OPMP/ACMP Christine Ballard, DNR, OPMP / ACMP Matt LaCroix, DNR, OHMP Mark Fink, ADF&G Wayne Dolezal, ADF&G Kellie Westphal, DNR, DML&W Linda Books, DNR, DML&W Cynthia Espinoza, DEC Lydia Miner, DEC Stephanie Ludwig, DNR, SHPO AOGCC Kevin Tabler, Unocal @~&~] Q} &~@~ DIVISION OF OIL & GAS ) FRANK H. MURKOWSKI3 GOVERNOR DEPARTMENT OF NATURAL RESOURCES 550 WEST 7TH AVENUE, SUITE 800 ANCHORAGE, ALASKA 99501-3560 PHON~;:' :'(~'a7J'2:6],:'~80a ~i', FAX: ~! :¡ '(-907) '2Õ9-89ß'B I; - , 2 B Z005 June 24, 2005 GAS STORAGE LEASE APPLICATION RECEIVED CALL FOR COMMENTS & ALASKA COASTAL MANAGEMENT PROGRAM CONSISTENCY REVIEW The Department of Natural Resources (DNR), Division of Oil and Gas (DO&G) hereby gives notice under AS 38.05.945 of the receipt of a gas storage lease application under AS 38.05.180(u). Notice is also given under AS 46.40.096(c) that this application is within the Matanuska-Susit~a Borough Coastal Management District. Union Oil Company of California (Unocal) proposes to store natural gas in two gas sand horizons within a gas storage reservoir area utilizing existing gas wells and facilities located approximately 3D-miles west of Anchorage in the Susitna Flats State Game Refuge. All of the lands within the proposed storage area are subject to existing oil and gas leases and in the Pretty Creek Unit, owned and operated by' Unocal. Unocal must obtain approval from agencies with jurisdiction, including the Alaska Oil and Gas Conservation Commission, prior to any gas injection. The propos~d storage lease area includes all or portions of the following state lands: T. 14 N., R. 9 W., Seward Meridian Sections 27,28,29,32,33,34 and T. 13 N., R. 9 W., Seward Meridian Sections 3, 4, and 5 You may review the application at the Division of Oil and Gas, Leasing Section, 550 West 7th Avenue, Suite 806, Anchorage. The Director, DO&G calls for your comments on the application's consistency with the Alaska Coastal Management Program (ACMP). The issuance of this lease would be a phased activity under AS 46.40.094(a)(2). Further development of the leased area would require additional permits and ACMP review. Comments regarding inconsistency with any of the Matanuska-Susitna Borough Coastal Management District's enforceable policies or a state standard set out in 11 MC 112 must be in writing and identify the enforceable policy or standard and explain how the application is inconsistent. Following the comment period, DO&G will issue a consistency determination. DO&G will send a copy of the consistency determination to any person who provides written comment. In addition, the Director, DO&G calls for separate comments under AS 38.05.035(e) regarding whether the issuance of the proposed lease would be in the best interests of the state. Following this comment period and the issuance of the ACMP consistency determination, DO&G will issue a written finding. To be eligible to appeal this finding, a person must provide written comments during this comment period. DO&G will send a copy of the final finding to any person who provides written comment. "Develop, Conserve, and Enhance Natural Resources for Present and Future Alaskans. " To be considered, written coml, ,lnts must be submitted to: ') ~ /l Director, Division of Oil and Gas 550 West ¡th Avenue, Suite 800 Anchorage, AK 99501-3560 and must be received on or before July 25, 2005w Comments will also assist DO&G when considering lease stipulations and mitigation measures. FOR MORE INFORMATION CONTACT: Jonne Slemons, Natural Resource Specialist Division of Oil and Gas 550 West 7th Avenue, Suite 800 Anchorage, AK 99501-3560 Phone: (907) 269-8806 Fax: (907) 269-8943 e-mail: Jonne_Slemons@dnr.state.ak.us The State of Alaska, DNR, DO&G complies with Title It of the Americans with Disabilities Act 1990. This Notice will be made available in alternative communication formats upon request. Please contact Tom Bucceri at (907) 269-8801 to make any necessary arrangements. Department of Natural Resources Division of Oil & Gas - Lease Sales 550 West 7th Avenue, Suite 800 Anchorage, AK 99501 ) June 24,2005 ) Ii ~\ ,", 1'1' 'ì fI \J 5 J~ j,~\~ I~þ h LU l ~ ~~ l~1~ .,,' The Department of Natural Resources (D~}?"",,,~,t:,!~ Division of Oil and Gas (DO&G) hereby givbs" (,,,, notice under AS 38.05.945 of the receipt of a gas storage lease application under AS 38.05.180(u). Notice is also given under AS 46.40.096(c) that this application is within the Matanuska-Susitna Borough Coastal Management District. GAS STORAGE LEASE APPLICATION RECEIVED, CALL FOR COMMENTS & ALASKA COASTAL MANAGEMENT PROGRAM CONSISTENCY REVIEW Union Oil Company of California (Uno c al) proposes to store natural gas in two gas sand horizons within a gas storage reservoir area utilizing existing gas wells and facilities located approximately 30-miles west of Anchorage in the Susitna Flats State Game Refuge. All of the lands wi thin the proposed storage area are subj ect to existing oil and gas leases and in the Pretty Creek Unit, owned and operated by Unocal. Unocal must obtain approval from agencies with jurisdiction, including the Alaska Oil and Gas Conservation Commission, prior to any gas inj ection. The proposed storage lease area includes all or portions of the following state lands: T. 14 N., R. 9 W., Seward Meridian Sections 27, 28, 29, 32, 33, 34 and T. 13 N., R. 9 W., Seward Meridian Sections 3, 4, and 5 You may review the application at the Division of Oil and Gas, Leasing Section, 550 West 7th Avenue, Suite 806, Anchorage. The Director, DO&G calls for your comments on the application's consistency with the Alaska Coastal Management Program (ACMP). The issuance of this lease would be a phased activity under AS 46.40.094(a)(2). Further development of the leased area would require additional pennits and ACMP review. Comments regarding inconsistency with any of the Matanuska-Susitna Borough Coastal Management District's enforceable policies or a state standard set out in 11 AAC 112 must be in writing and identify the enforceable policy or standard and explain how the application is ) ) inconsistent. Following the comment period, DO&G will issue a consistency detennination. DO&G will send a copy of the consistency detennination to any person who provides written comment. ill addition, the Director, DO&G calls for separate comments under AS 38.05.035(e) regarding whether the issuance of the proposed lease would be in the best interests of the state. Following this comment period and the issuance of the ACMP consistency detennination, DO&G will issue a written finding. To be eligible to appeal this finding, a person must provide written comments during this comment period. DO&G will send a copy of the final finding to any person who provides written comment. To be considered, ,vritten COIT1,.ments must be submitted to: Director, Division of Oil and Gas 550 West ih Avenue, Suite 800 Anchorage, AK 99501-3560 and must be received on or before July 25, 2005. Comments will also assist DO&G when considering lease stipulations and mitigation measures. FOR MORE INFORMATION CONTACT: Jonne Slemons, Natural Resource Specialist Division of Oil and Gas 550 West ih Avenue, Suite 800 Anchorage, AI<. 99501-3560 Phone: (907) 269-8806 Fax: (907) 269-8943 e-mail: Jonne_Slemons@dnr.state.alcus The State of Alaska, DNR, DO&G complies with Title II of the Americans with Disabilities Act 1990. This Notice will be made available in alternative communication formats upon request. Please contact Tom Bucceri at (907) 269-8801 to make any necessary arrangements. ') ) STATE OF ALASKA DEPARTMENT OF NATURAL RESOURCES JUN 2 8 2005 Underground Gas Storage Lease Lease No. This Lease Agreement is made and entered into by and between the State of Alaska, Department of Natural Resources, Division of Oil and Gas ("Lessor"), and Union Oil Company of California ("Lessee"), each sometimes individually hereinafter referred to as a "Party" or collectively as the "Parties" as of the 1 st day of June, 2005 ("Effective Date"). RECITALS: A. Lessee proposes to establish a gas storage facility in the Pretty Creek Unit on and underlying the following described real property: The South 1/2 of the Northwest 1/4, the South 1/2 of the Northeast 1/4, and the South 1/2, all of Section 33, Township 14 North, Range 9 West; and the North 1/2 of the Northwest 1/4, the North 1/2 of the Northeast 1/4, the Southeast 1/4 of the Northwest 1/4, and the Southwest 1/4 of the Northeast 1/4, all of Section 4, Township 13 North, Range 9 West, all located in the Anchorage Recording District, Third Judicial District, State Alaska, and comprising 720 acres, more or less, as illustrated in Exhibit A. All of such land, plus or minus such land as may be subsequently added to or released from coverage under Section 6 of this Agreement, is referenced in this Agreemènt as the Lands and/or the Gas Storage Reservoir Area. B. All of the Lands within the Gas Storage Reservoir Area are subject to existing oil and gas leases and the Pretty Creek Unit Agreement ("Unit Agreement") by and between Lessor and Lessee, which leases are more particularly described in Exhibit B. C. Lessee proposes to utilize the two gas sand horizons within the Gas Storage Reservoir Area for the storage of natural gas, whether or not produced from state owned lands, which sands are described as follows: Sterling 45-0 Gas Sands and Beluga 51-5 Gas Sands between the measured depth of 4,503 feet and 5,173 feet below the surface of the ground in the Pretty Creek Unit #4 well, the surface wellhead of which is located in Section 33, Township 14 North, Range 9 West, Seward Meridian, Alaska, which sands are referenced in this Agreement as the Gas Storage Formation. D. Under the terms and provisions of AS 38.05.180(u), 11AAC 88.105 and 11 AAC 83.500- 520, to avoid waste or to promote conservation of natural resources, the Commissioner of Natural Resources is empowered to authorize the subsurface storage of gas, whetheï or not produced from state owned lands, in lands leased or subject to lease under state law. Page 1 ) ) TERMS: NOW THEREFORE, it is agreed as follows: 1 GRANT The Lessor does hereby grant and authorize the Lessee the exclusive use of the State interests in the Gas Storage Formation in the Gas Storage Reservoir Area for underground gas storage purposes, and does hereby exclusively authorize Lessee to store gas and at will to inject gas into and withdraw gas from storage. Lessee shall be under no obligation to inject or withdraw, or store a particular quantity of gas other than such gas as it shall in its sole discretion deem advisable. The Lessor does hereby exclusively authorize Lessee to enter upon the surface of the said Gas Storage Reservoir Area, to the extent that said surface is owned by the Lessor, for the purpose of injecting gas into and withdrawing gas from said Gas Storage Formation by means of any well now existing or hereafter drilled as provided for by Section 2 hereof. 2 LESSEE RIGHTS AND OBLIGATIONS Lessee shall have the right to drill, rework, or abandon such wells to the Gas Storage Formation on State land within the Gas Storage Reservoir Area to the extent that such work shall be approved by Lessor prior to commencement as necessary for the enjoyment by Lessee of the gas storage rights granted by this Agreement. Lessor does hereby authorize Lessee to construct, install, maintain, and remove from the State lands structures, pipelines, casing, drips, valves, and other appurtenances necessary, useful, or convenient for the purpose of this Agreement. Lessee agrees that all operations and other actives conducted under this Agreement on State owned lands are subject to the terms and conditions of applicable State oil and gas leases, as modified by this Agreement, to all applicable laws, and to all statutes and regulations applicable to oil and gas operations, including those hereafter promulgated when not inconsistent with the specific provisions of this Agreement. The lessee agrees to furnish subsequent reports of such operations, along with all necessary data, to Lessor within thirty (30) days of completions of the operation. 3 EFFECTIVE DATE This Agreement shall be effective on and from the Effective Date, and shall remain in force and effect for a period of ten (10) years and so long thereafter as Lessee shall continue to use the Lands or any portion thereof for underground storage purposes, unless terminated sooner as provided in Section 10 hereof. 4 RENTAL As consideration to Lessor for the rights, power, and privileges granted herein, Lessee agrees to pay Lessor an annual rental payment of $10 per acre of the Gas Storage Reservoir Area per year during the term hereof. Such annual payment shall be due and payable on or before each anniversary of the Effective Date. Lessee's failure to timely pay such annual rental payment shall not be grounds for cancellation of this Agreement. Page 2 ') ) 5 NATIVE GAS 5.1 It is hereby agreed between the Lessor and Lessee that there were 160 million cubic feet (MMcf) of recoverable reserves of native gas in the Gas Storage Formation within the Gas Storage Reservoir Area as of the Effective Date. The native gas will be deemed to be produced equally on an acreage basis from the several oil and gas leases forming the Gas Storage Reservoir Area. Each such lease shall have allocated to it such percentage of said native gas production as provided in the Unit Agreement. / 5.2 Royalty on the native gas attributed on leased State acreage will be computed at the royalty rate and paid as specified in the respective oil and gas leases and shall be paid not later than thirty (30) days after the execution of this Agreement by all necessary signatory parties and on or prior to each subsequent anniversary date thereafter. Should it become apparent at a later date that the amount of native gas withdrawn from the Gas Storage Reservoir Area is in excess of the 160 MMcf herein established as recoverable reserves on the Effective Date, Lessee agrees to make additional payments to the Lessor on the basis as heretofore prescribed. To determine whether any such additional payment is due, it is agreed that if the total gas withdrawn from storage exceeds the total gas injection plus 160 MMcf, additional payments for,such excess withdrawal will be due the Lessor on their proportionate share thereof. 6 EXPANSION OR CONTRACTION OF STORAGE AREA 6.1 Nothing in this Agreement shall be construed as limiting the right of the oil and gas Lessees to relinquish at any time their State oil and gas leases covering all or part of the lands within or outside the Gas Storage Reservoir Area. 6.2 In the event it should be determined that lands within the Gas Storage Reservoir Area are not necèssary for the purposes of this Agreement, said lands may be eliminated from the Gas Storage Reservoir Area by filing with the Commissioner a request, together with supporting geologic and engineering data, to eliminate such land. Upon approval of the request by the Commissioner, the lands and formations shall be deemed removed as of the date specified by the Commissioner. 6.3 If Lessee demonstrates to the satisfaction of the Commissioner, or the Commissioner determines that stored gas is migrating from the Gas Storage Formation to other formations or that stored gas within the Gas Storage Formation is expanding beyond the limits of the Gas Storage Reservoir Area, this Agreement may be amended, effective as of the date prescribed by the Commissioner, to exclude or include formations or lands subject to the same terms and conditions applicable to the lands and formations previously committed to this Agreement. Thereupon the annual storage fees for the State lands, specified in Section 4 of this Agreement, shall be reduced or increased by an amount equal to $10 per acre of State lands eliminated or added effective the next anniversary date of the Agreement. Within thirty (30) days after the Effective Date of any such contraction or expansion of the Gas Storage Reservoir Area, Lessee shall file revised Exhibits A and B and all other appropriate data showing affected leases, tracts, and land descriptions with the Commissioner. Page 3 ) ) 7 GAS MEASUREMENT All stored gas shall be measured when injected into and withdrawn from storage, and a record thereof shall be kept. Lessee agrees to render to the Commissioner within thirty (30) days after each calendar year quarter, a statement certified by Lessee showing the total amount of gas injected into and withdrawn from said Gas Storage Formation during that preceding calendar year quarter. The amount of gas reported as injected and withdrawn each quarter shall be computed as a standard pressure of 14.65 pounds per square inch absolute and a standard temperature of 60 degrees Fahrenheit, regardless of the pressure and temperature at which the gas was actually measured. The statements herein required shall be filled with the Commissioner. 8 BONDING; SURFACE DAMAGES 8.1 Lessee has provided and, during the term of this Agreement, shall keep current a statewide bond as provided in 11 AAC 83.160( c). Said bond shall be further conditioned upon compliance with the terms of this Agreement. 8.2 Lessee shall pay any damage that becomes payable under AS 38.05.130 and shall indemnify Alaska and hold it harmless from and against any claims, demands, liabilities, and expenses arising from or in connection with the damage. 9 ROYALTIES 9.1 The Unit Agreement and the oil and gas leases covering the Gas Storage Reservoir Area are hereby modified to provide that no royalties shall accrue and be payable thereunder on any stored gas injected or removed from the Gas Storage Formation pursuant to this Agreement. 9.2 In the event the total gas ultimately withdrawn from the Gas Storage Formation exceeds the total gas determined to be in place at the inception of this Agreement plus the total gas ultimately injected, royalty payments shall be valued and made in accordance with the provisions set forth in Section 5 of this Agreement for excess native gas withdrawn from the Gas Storage Formation. 9.3 Any virgin or original gas subsequently discovered in other formations within the Gas Storage Reservoir Area shall be produced only under the terms and conditions of the respective oil and gas leases, unit agreement, or other agreements covering such formations. 9.4 None of the payments made pursuant to Section 4 of this Agreement shall be credited against any rentals or minimum royalties provided for under the terms ofthe respective oil and gas leases. For oil and gas leases without a well capable of production in paying quantities, the lessee must pay the applicable annual rental or minimum royalty in accordance with the terms of the respective oil and gas lease and any applicable unit agreement. Page 4 ) ) 10 RENEGOTIATION AND TERMINATION OF AGREEMENT 10.1 During the term of this Agreement, the rental amount set forth in Section 4 shall be renegotiated on or before each tenth (10th) anniversary of this Agreement for the next ten year period. In no event shall the increase or decrease in annual storage fees through such renegotiation exceed ten (10) percent of the then-current rental for the succeeding ten (10) year period. If the parties hereto are unable to agree upon renegotiated new fees prior to the first day of any such succeeding ten year period, this Agreement shall continue so long as Lessee is willing to and does pay a rental which is ten (10) percent higher than the then-current rental for the succeeding ten (10) year period. In the event the parties are unable to agree on a new rental and the Lessee is not willing to pay a rental which is ten (10) percent higher than the then-current rental for the succeeding ten (10) year period, the prior rental rate shall continue and this Agreement shall terminate upon expiration of an additional two (2) years, unless during such two year period the parties hereto agree upon a renegotiated rate to be effective retroactively to said first day or the Lessee is willing to and does pay a rental which is ten (10) percent higher than the then-current rental for the succeeding ten (10) year period. Any gas remaining in the Gas Storage Formation beneath State tracts or any facilities not removed from the surface of the State lands at the termination of this Agreement shall become the property of the Lessor. 10.2 The Lessor reserves the right to terminate this Agreement at any time if the Lessee shall violate and shall continue to violate any of the terms, conditions, or provisions of this Agreement for more than thirty (30) days after receipt by the Lessee of notice of such violation by registered or certified mail from the Commissioner. 10.3 The Lessor reserves the right to terminate this Agreement in the event Lessee has not used any portion of the Gas Storage Formation for the storage of gas for a two- year period. The Commissioner must provide Lessee with written notice of his intention to terminate this Agreement at least sixty (60) days before termination. In the event Lessee is able to provide sufficient evidence of actual storage activities or the continued need for storage under this Agreement within this period of time, the Agreement shall continue. 10.4 Upon agreement between the Lessor and the Lessee, this Agreement may be voluntarily terminated at any time. 10.5 Lessee shall have two (2) years from the date of termination of the Agreement in which to remove all gas facilities and any remaining injected gas, subject to the payment of all rental and royalties pursuant to the terms of this Agreement and any existing oil and gas lease. 11 ACCESS TO RECORDS Lessee agrees to keep open all reasonable times, for the inspection by Lessor, the premises covered hereby, and all wells, improvements, machinery, and fixtures thereon, and all books, accounts, meter charts, and records pertaining to operations hereunder or the payments herein provided. Lessee further agrees to furnish all required periodic reports and any special reports or information pertinent to this Agreement as may be reasonably requested Page 5 ) ) by the Commissioner. 12 RESERVATION OF RIGHTS Lessor expressly reserves the right to (1) utilize the surface and to lease, sell, or otherwise dispose of the surface of any of the above described lands so far as said surface is owned by the Lessor and is not necessary for the use of Lessee in injecting, storing, and withdrawing of gas from the Gas Storage Formation, or (2) dispose of any resource on or in such lands, subject to such condition as are necessary to preclude unreasonable interference with Lessee operations under this Agreement. 13 FORCE MAJEURE 13.1 No Party shall be responsible for any loss or damage to another Party resulting from any delay in performing or failure to perform any obligation under this Agreement (other than Lessee's obligation to make payments due and owing under this Agreement) if the failure or delay is caused by a Force Majeure Event. 13.2 "Force Majeure Event" means any event that directly or indirectly renders a Party unable, wholly or in part, to perform or comply with any obligation, covenant or condition in this Agreement if the event, or the adverse effects of the event, is outside of the control of, and could not have been prevented by, the affected Party with reasonable foresight, at reasonable cost, and by the· exercise of reasonable diligence in good faith, and is not attributable to the negligence or willful misconduct of the affected Party. Force Majeure Events include without limitation the following events (to the extent they otherwise satisfy the definition): (a) act of God, fire, lightning, landslide, earthquake, storm, hurricane, hurricane warning, flood, high water, washout, explosion, or well blowout; (b) strike, lockout, or other industrial disturbance, act of the public enemy, war, military operation, blockade, insurrection, riot, epidemic, arrest or restraint by government of people, terrorist act, civil disturbance, or national emergency; (c) the inability of the affected Party to acquire, or the delay on the part of the affected Party in acquiring materials, supplies, machinery, equipment, servitudes, right of way grants, easements, permits or licenses, approvals, or authorizations by regulatory bodies or oil and gas lessors needed to enable the Party to perform; (d) breakage of or accident to machinery, equipment, facilities, or lines of pipe, and the repair, maintenance, improvement, replacement, test, or alteration to the machinery, equipment, facilities, or lines of pipe, and the freezing of a well or line of pipe, well blowout, or the partial or entire failure of a well; or (e) act, order, or requisition of any governmental agency or acting governmental authority, or any governmental law, proration, regulation, or priority. 13.3 Notice and Remedy: The Party claiming the excuse of Section 13.2 shall: (a) notify the other Party of the Force Majeure Event within a reasonable time after its occurrence, giving reasonably full particulars and its best estimate of the time required to remedy the Force Majeure Event; (b) keep the other Party informed of all significant developments; (c) exercise diligence in good faith to remedy the Force Majeure Event and resume full performance under this Agreement as soon as reasonably practicable (except that the settlement of strikes, lockouts, or other labor disputes or the restoration of a failed Gas well shall be entirely within the discretion of the affected Party); and (d) if the Party claiming the Force Majeure Event Page 6 ) ) estimates that the Force Majeure Event will not be remedied for twenty-four (24) Months or more, the other Party may terminate this Agreement on sixty (60) days notice. 14 ASSIGNMENT; SUCCESSORS AND ASSIGNS This Agreement, or an interest in this Agreement, may, with the approval of Lessor, be assigned, subleased, or otherwise transferred to any person or persons qualified to hold a gas storage lease. No assignment, sublease, or other transfer of an interest in this Agreement will be binding upon Lessor unless approved by Lessor. Lessee shall remain liable for all obligations under this Agreement accruing prior to the approval by Lessor of any assignment or other transfer of an interest in this Agreement. All provisions of this Agreement will extend to and be binding upon the legal representatives, successors, and assigns of Lessor and Lessee. Applications to Lessor for approval of an assignment or other transfer must comply with all applicable regulations and must be filed within 90 days after the date of final execution of the instrument of transfer. Lessor will approve a transfer of an undivided interest in this lease unless the transfer would adversely affect the interests of Alaska or the application does not comply with applicable regulations. 15 NOTICES 15.1 Any notices required or permitted under this lease must be by electronic 'media producing a permanent record or in writing and must be given personally or by registered or certified mail, return receipt requested, addressed as follows. (The Parties may, but are not required, to provide an additional courtesy notice by email.) To Lessor: Director, Division of Oil and Gas Department of Natural Resources 550 West 7th Avenue, Suite 800 Anchorage, Alaska 99501-3560 Email: To Lessee: Manager, Land and Government Affairs Union Oil Company of California 909 West 9th Avenue Anchorage, Alaska 99501 Email: tablerk@unocal.com 15.2 Any notice given under this paragraph will be effective when delivered to the above authorized representative. ' 15.3 Any Party may provide a different physical or email address for future notices by providing notice to the other Party in accordance with the provisions of this section. Page 7 ) ) estimates that the Force Majeure Event will not be remedied for twenty-four (24) Months or more, the other Party may terminate this Agreement on sixty (60) days notice. 14 ASSIGNMENT; SUCCESSORS AND ASSIGNS This Agreement, or an interest in this Agreement, may, with the approval of Lessor, be assigned, subleased, or otherwise transferred to any person or persons qualified to hold a gas storage lease. No assignment, sublease, or other transfer of an interest in this Agreement will be binding upon Lessor unless approved by Lessor. Lessee shall remain liable for all obligations under this Agreement accruing prior to the approval by Lessor of any assignment or other transfer of an interest in this Agreement. All provisions of this Agreement will extend to and be binding upon the legal representatives, successors, and assigns of Lessor and Lessee. Applications to Lessor for approval of an assignment or other transfer must comply with all applicable regulations and must be filed within 90 days after the date of final execution of the instrument of transfer. Lessor will approve a transfer of an undivided interest in this lease unless the transfer would adversely affect the interests of Alaska or the application does not comply with applicable regulations. 15 NOTICES 15.1 Any notices required or permitted under this lease must be by electronic 'media producing a permanent record or in writing and must be given personally or by registered or certified mail, return receipt requested, addressed as follows. (The Parties may, but are not required, to provide an additional courtesy notice byemail.) To Lesso r: Director, Division of Oil and Gas Department of Natural Resources 550 West 7th Avenue, Suite 800 Anchorage, Alaska 99501-3560 Email: To Lessee: Manager, Land and Government Affairs Union Oil Company of California 909 West 9th Avenue Anchorage, Alaska 99501 Email: tablerk@unocal.com 15.2 Any notice given under this paragraph will be effective when delivered to the above authorized representative. 15.3 Any Party may provide a different physical or email address for future notices by providing notice to the other Party in accordance with the provisions of this section. Page 7 ) ) 16 GOVERNING LAW This Agreement shall be construed and enforced in accordance with the laws of the State of Alaska, excluding any choice of law principle which would direct the selection of law other than the law of the State of Alaska. 17 INTERPRETATIVE MATTERS 17.1 The section headings are for convenience of reference only and are not intended to restrict, affect or be of any weight in the interpretation or construction of the provisions of this Agreement or its sections. 17.2 The term "including" when used in this Agreement shall be by way of example only and shall not be considered in any way to be in limitation. 17.3 Any reference to a dollar amount contained in this Agreement shall refer to United States dollars. 17.4 Unless the context requires otherwise, any reference in this Agreement to any document or instrument is a reference to that document or instrument and all schedules, exhibits, and attachments thereto as amended and in effect from time to time. 17.5 Unless otherwise stated, any reference in this Agreement to any person, entity, or organization includes its permitted successors and assigns and, in the case of any governmental authority, any person succeeding to its functions and capacities. 17.6 The words "hereof," "herein," "hereto" and "hereunder" and words of similar import when used in this Agreement, unless otherwise expressly specified, refer to this Agreement as a whole and not to any particular provision of this Agreement. 17.7 Unless the context requires otherwise, the present tense shall be read to include the past tense and the past tense shall be read to include the present tense, the male gender shall be read to include the female gender, and the singular shall be read to include the plural and the plural shall be read to include the singular. 17.8 This Agreement is the product of negotiation and collaboration between the Parties and interpretation of the terms of this Agreement shall favor neither Party. 18 ENTIRE AGREEMENT This Agreement constitutes the final agreement between the Parties. It is the complete and exclusive expression of the Parties' agreement on the matters contained in this Agreement. All prior and contemporaneous negotiations and agreements between the Parties on the matters contained in this Agreement are expressly merged into and superseded by this Agreement. The provisions of this Agreement may not be explained, supplemented or qualified through evidence of trade usage or a prior course of dealings. In entering into this Agreement, neither party has relied upon any statement, representation, warranty or agreement of the other party except for those expressly contained in this Agreement. There are no conditions precedent to the effectiveness of this Agreement, other than those Page 8 ) ) expressly stated in this Agreement. 19 SEVERABILITY If any provision of this Agreement is determined to be invalid, illegal or unenforceable, the remaining provisions of this Agreement remain in full force, if the essential terms and conditions of this Agreement for each Party remain valid, binding, and enforceable. 20 NO THIRD PARTY BENEFICIARIES This Agreement does not and is not intended to confer any rights or remedies upon any person, entity or agency other than the signatories. 21 FURTHER ASSURANCES Each Party shall use all commercially reasonable efforts to take, or cause to be taken, all actions, and execute all such further documents, as may be necessary or desirable to consummate and make effective and carry out the provisions this Agreement. 22 AMENDMENT The parties may amend this Agreement only by a written agreement of the parties that identifies itself as an amendment to this Agreement. IN WITNESS WHEREOF, the Parties have executed the foregoing instrument as of the Effective Date. LESSOR: STATE OF ALASKA LESSEE: UNION OIL COMPANY OF CALIFORNIA By: By: Mark D. Myers Director, Division of Oil and Gas Kevin A. Tabler Attorney-in-Fact Date: Date: Page 9 ) ) ACKNOWLEDGMENTS State of Alaska State of Alaska ) ) ss. Third Judicial District ) The foregoing instrument was acknowledged before me this _ day of , 2005, by Mark D. Myers, as Director of the Division of Oil and Gas of the State of Alaska, Department of Natural Resources, on behalf of State of Alaska, Lessor. Notary public in and for the State of Alaska My commission expires: Union Oil Company of California State of Alaska ) ) ss. Third Judicial District ) The foregoing instrument was acknowledged before me this day of , 2005, by Kevin A. Tabler, as attorney-in-fact on behalf of Union Oil Company of California, Lessee. Notary public in and for the State of Alaska My commission expires: Page 10 ) I ') Exhibit A Underground Gas Storage Lease Pretty Creek Unit Gas Storage Reservoir Area " "",:'" <' " ,,: ;:' :,¡;~.:;.:;~;::;;~,~[~~;;~;;:'·C~t~~Ii::'.'I;I,~,~:~~,:;:~:),~!.;,'},\!1.~'):;¡.~'~);,~;¡'1;·t::1~~~'i..l!;;,M1';;;:IL:'1~I:VI):n;'!J:,:.\J!!~;~:'\;:¡::'~'~~:~::t:X;;':;;J\,,¡, \r- "-, ' ' "~ Îlj "I~ 11 '~r !~! ~! H ~I f, ,I!:~ ~\ ~ ADL063o.t.7 ".ír·"~~'''·\'''·ii; 28 27 II, ' "", ~-""" ~.' , ~ ~ f PCU 224-28 , i Ir~od I - ~ ~ 1 ADL058810 HJL39J,1Q4 -:: ,I AÐ~O~~r- I:,! .-jl ¡lJ H ,,~] t-' """ . ADtb.oo49 32 '').~~~'f¡1'!tl':Jìt~, ~ ~ 2I14N R9W rNR~ ADL05881.4 5 C q ¡ Ö ~ II , ~ ! ~i:,Y=~':i~tl!t.I;;;I.~:~::2':"ro-:,:::~ ,::J¡~\.~\~:_v...~_.~.: '::~:;:'~';:';¡;;;:<£Eì.':·!í~.:r.:t'Î!.J;;Z:;.r~r.ü..'¡~,~:::~.: ADL390tOO I ' ACL300102 51-5 . ~,f;\~;'¢,~, ,', i ~~,ii.'jr"~ ,,' ,:~ ~:I¥:~',~,:,¡:i~\;:~;:::!i;';:;:~::~i!;:r~~~" ~;i~" :{'. ~:~;~f'!f ..~..-- ''''';'':1 '~UJ.~930:, .. ': ~;,~",,:,,-: '"",'i',',:' :~~r1::r:,J':;~':~';:;~;f ~ ~',' :;","I'¡~I :": '\i~I~:;",:~Nlf~~'r, 1;;I~;:11}i l ;:,,¡ ,d, ' " '"L·", "",'.., ,-. ~~ - . f,!¡~~;l ADL058813 ACL3E¡0571 x Pretty Creek Unit Pad Locations .ADL389520 ~,~'''I' ~ . PCU t4 Markers 0.5 0.25 0 J I Wü 0,5 UNOCALf) '-.-. Alaska. Page 11 cr- ') ) Exhibit B Underground Gas Storage Lease Pretty Creek Unit Oil and Gas Leases Unit Tract Number ADL Number 4 58813 11 63048 Description Acrea~e T13N, R9W, S.M. See 3: W1/2 See 4: All 960.00 T14N, R9W, S.M. See 28: All See 33: All 1,200.00 Gas Storage Reservoir Area Unit Tract Number ADL Number 4 58813 11 63048 Description T13N, R9W, S.M. See 4: N1/2NW1/4, N1/2NE1/4, SE1/4NW1/4', SW1/4NE1/4 T14N, R9W, S.M. See 33: S1/2NW1/4, S1/2 NE1/4, S1/2 Page 12 Acreage 240.00 480.00 720.00 #6 STATE OF ALASKA ') NOTICE TO PUBLISHER ) ADVERTISING ORDER NO. ADVERTISING ORDER SEE BOTTOM FOR II\VOICEA.[)DRESS INVOICE MUST BE IN TRIPLICATE SHOWING ADVERTISING ORDER NO" CERTIFIED AFFIDAVIT OF PUBLICATION (PART 2 OF THIS FORM) WITH ATTACHED COpy OF ADVERTISEMENT MUST BE SUBMITTED WITH INVOICE AO-02514040 F AOGCC R 333 W 7th Ave, Ste 100 o Anchorage, AK 99501 M AGENCY CONTACT DATE OF A.O. Jody Colombie PHONE June 23, 2005 PCN (907) 793 -1 ??l DATES ADVERTISEMENT REQUIRED: b Anchorage Daily News PO Box 149001 Anchorage, AK 99514 June 24, 2005 THE MATERIAL BETWEEN THE DOUBLE LINES MUST BE PRINTED IN ITS ENTIRETY ON THE DATES SHOWN. SPECIAL INSTRUCTIONS: Type of Advertisement X Legal D Display Advertisement to be published was e-mailed D Classified DOther (Specify) SEE ATTACHED SEND INVOICE IN TRIPLICATE AOGCC, 333 W. 7th Ave., Suite 100 TO AnchoraQ'e. A K 99:')01 REF TYPE NUMBER AMOUNT DATE VEN TOTAL OF PAGE 1 OF ALL PAGES$ 2 PAGES COMMENTS 2 ARD 3 4 02910 ¡:IN 6MnllNT ~v ~~ Pr:M I~ 6~~T ¡:v NMR DIST LlQ 05 02140100 73451 2 3 DIVISION APPROVAL: ) Notice of Public Hearing STATE OF ALASKA Alaska Oil and Gas Conservation Commission Re: The application of Union Oil Company of California ("Unocal") for a Storage Injection Order authorizing the underground storage of natural gas by injection into the Beluga and Sterling Formations in the Pretty Creek #4 well, Pretty Creek Undefined Gas Pool Cook Inlet Area, Alaska. Union Oil Company of California ("Unocal") by letter dated June 20, 2005, has applied for an injection order authorizing the underground storage of natural gas in the Beluga and Sterling Formations at Pretty Creek #4 well in accordance with 20 AAC 25.252. The Pretty Creek #4 well is located in Section 33, Township 14 N, Range 9 W, SM. The Beluga formation occurs at an approximate depth of 3600' SS and the Sterling formation occurs at an approximate depth of 3200' SS. The Commission has tentatively set a public hearing on this application for July 26,2005 at 9:00 am at the Alaska Oil and Gas Conservation Commission at 333 West ih Avenue, Suite 100, Anchorage, Alaska 99501. A person may request that the tentative hearing be held by filing a written request with the Commission no later than 4:30 pm on July 11, 2005. 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 ih Avenue, Suite 100, Anchorage, Alaska 99501. Written comments must be received no later than 4:30 pm on July 25, 2005, except that if the Commission decides to hold a public hearing, written comments must be received no later than 9:00 am on July 26, 2005. may need a special accommodation in , please contact Jody Colombie at 793- ~ Published Date: June 24. 2005 ADN AO# 02514039 ') Anchorage 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 530978 06/24/2005. 02514040 STOF0330 $179.36 $179.36 $0.00 $0.00 $0.00 $0.00 $0.00 $179.36 STATE OF ALASKA THIRD JUDICIAL DISTRICT Teresita Peralta, 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 individuals. Signed VrY~~tU Subscribed and sworn to me before this date: I UtIJltJ· a~ ~ Notary Public in and for the State of Alaska. Third Division. Anchorage, Alaska , MY COMMISSION EXPIRES: cY14 ~ø7 ß -Jy ~v1ß ~~'/:\\(!((({frrl ~ \ \ ~RL y 1"1"" / LA/J1 (Á;~¡ .- t~.. ~~'.'~~;,~..'Yþ 'I " .. ~OTA~j~'~ ~. --....,......... . ~. . ~ :::~: ÞuSL.iC : ~ - .(þ . .... =-~^ --. .l'J" ~ ..... -- . .~ S':: ~ ~. ·'~OF A~.· .a.:~ ~ ~. .'..., ._...A. '\ :\" '..11 ',e'xptr<op." ~~ ", ./J')J}jJJJP" Notice of PUQlic Hearing STATE OF ALASKA Alaska Oil and Gas Conservation Commission Re: The application of Union 011 Company 'of California ("Unocal") for an a Storage Inlection Order authoriz.lngthe underground storage of natural gas by ,in1ection Into the Beluga and ¡¡ter- ling Formationsin.,the Pretty Creek #4 well, Pretty Creek Undefined Gas Pool Cook I nlet Area, Alaska. Union Oil Company o.f California ("Unocal") by,' letter dated June 20, 2005, has applie.d for an.iniec- tion order authorizing the underground storage of natural gas In the Beluga and¡¡terlir)9 .Formation~ I for storage inlection well,' at ,Pretty Creek #4 well In accordance with 20 AAC25.25.2. 'Th.e .Pretty, Creek #4 well is locatec;l in Section 33, TownshiÞ 1,4' , N, Range 9 w, sM. The Beluga formation occurs at an approximate depth of 3600' SS and the Ster- ling formation occurs at an approximate depth of 3200~ 5S. The Commlssl.onhas tentath/ely set a public hear- ing 9nthls application for'Julv 26, 2005 at 9:00 am at the Alaska 011 and Gas Conservation Commis- sion at 333 West 7th Avenue, Suite 100, Anchorage, Alaska 99501. A person may tequest that th,e tenta- tive tentativelY scheduled hearing be held by filing a written request with the Commission no later than.4:30 pm on JulY 11, 2005. If a request for a hearing is not timely filed, the Commfssion will consider the issuance of an ord~r without a hearing To learn if the Commission will hold the public hearing, please call 793-1221. In addition, a person may submit written com- ments regarding this application to the Alaska 011 arid Gas Conservation Commission at 333 West 7th Avenue, Suite 100, Anchorage, Alaska 99501. "Writ- ten comments must be received no later than 4:30 pm on· July 25, 2005, except that if the Commission decides to hold a public hearing, written com- ments must be received no later than 9:00 am on July 26,2005. If YOU are a person with a disability who may need a special accommodation in order..to comment or to attend the public hearing, please contact Jody Colombie at 793-1221 before July 20; 2005. Is!: John Norman Chairman ADN AO# 02514040 Published Date: June 24, 2005 I -\ ~e: Notice ) Subject: Re: Notice From: "Kirby, Kimberly" <KKirby@adn.com> Date: Thu, 23 lun 2005 15:27:36 -0800 To: lady Colombie <jody_colombie@admin.state.ak.us> Hello Jody: BE SURE TO CHECK OUT THE LEGAL NOTICES ON-LINE. WE RECENTLY CREATED NEW LEGAL SECTIONS ON-LINE ESPECIALLY FOR THE STATE OF ALASKA. WE ARE OFFERING A 90 DAY FREE TRIAL ON ALL LEGAL ADVERTISING AS OF MAY 9TH TO PROMOTE OUR NEW ON-LINE, USER FRIENDLY CATEGORY'S. PLEASE TAKE THIS TIME TO TRACK YOUR CUSTOMERS AND SEE IF ON-LINE ADVERTISING IS RIGHT FOR YOU. Following is the confirmation information on your legal notice. Please review and let me know if you have any questions or need additional information. Account Number: STOF 0330 Legal Ad Number: 530978 Publication Date(s): June 24, 2005 Your Reference or PO#: 02514040 Cost of Legal Notice: $179.36 Additional Charges: Web Link: E-Mail Link: Bolding: Total Cost To Place Legal Notice: $179.36 Your Legal Notice Will Appear On The Web: www.adn.com: XXXX Your Legal Notice Will Not Appear On The Web www.adn.com: Thank You, Kim Kirby Anchorage Daily News Legal Classified Representative E-Mail: legalads@adn.com Phone: (967)'25..7..'::::'42..9..6'........."..., Fax: (907) 279-8170 On 6/23/05 12:03 PM, "Jody Colombie" <jody colombie@admin.state.ak.us> wrote: Please publish on Friday. Jody 1 of I 6/27/2005 8:21 AM 02-902 (Rev. 3/94) Publishel ~inal Copies: Department Fiscal, Departme )eceiving AO,FRM STATE OF ALASKA ADVERTISING ORDER SEE BOTTOM FORINVOICE ADDRESS NOTICE TO PUBLISHER ADVERTISING ORDER NO. INVOICE MUST BE IN TRIPLICATE SHOWING ADVERTISING ORDER NO" CERTIFIED AO 02514040 AFFIDAVIT OF PUBLICATION (PART 2 OF THIS FORM) WITH ATTACHED COpy OF - ADVERTISEMENT MUST BE SUBMITTED WITH INVOICE F AOGCC 333 West ih Avenue. Suite 100 Anr,n()r~a~ A K qq,,() 1 907-793-1221 AGENCY CONTACT DATE OF A.a. R o M Jodv C:olombie June ?J. )005 PHONE PCN (907) 793 -1 ?,) 1 DATES ADVERTISEMENT REQUIRED: T a Anchorage Daily News PO Box 149001 Anchorage, AK 99514 June 24, 2005 THE MATERIAL BETWEEN HIE DOUBLE LINES MUST BE PRINTED IN ITS ENTIRETY ON THE DATES SHOWN. SPECIAL INSTRUCTIONS: United states of America AFFIDAVIT OF PUBLICATION REMINDER State of ss INVOICE MUST BE IN TRIPLICATE AND MUST REFERENCE THE ADVERTISING ORDER NUMBER. A CERTIFIED COPY OF THIS AFFIDAVIT OF PUBLICATION MUST BE SUBMITTED WITH THE INVOICE, ATTACH PROOF OF PUBLICATION HERE. division. Before me, the undersigned, a notary public this day personally appeared 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 2005, and thereafter for _ consecutive days, the last publication appearing on the _ day of . 2005, 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 2005, Notary public for state of My commission expires 02-901 (Rev, 3/94) AO.FRM Citgo Petroleum Corporation PO Box 3758 Tulsa, OK 74136 Mona Dickens Tesoro Refining and Marketing Co, Supply & Distribution 300 Concord Plaza Drive San Antonio, TX 78216 Jerry Hodgden Hodgden Oil Company 408 18th Street Golden, CO 80401-2433 Kay Munger Munger Oil Information Service, Inc PO Box 45738 Los Angeles, CA 90045-0738 Mark Wedman Halliburton 6900 Arctic Blvd, Anchorage, AK 99502 Ciri Land Department PO Box 93330 Anchorage, AK 99503 Jill Schneider US Geological Survey 4200 University Dr. Anchorage, AK 99508 Darwin Waldsmith PO Box 39309 Ninilchick, AK 99639 Penny Vadla 399 West Riverview Avenue Soldotna, AK 99669-7714 Bernie Karl K&K Recycling Inc. PO Box 58055 Fairbanks, AK 99711 ') Mary Jones XTO Energy, Inc. Cartography 810 Houston Street, Ste 2000 Ft. Worth, TX 76102-6298 Robert Gravely 7681 South Kit Carson Drive Littleton, CO 80122 Richard Neahring NRG Associates President PO Box 1655 Colorado Springs, CO 80901 Samuel Van Vactor Economic Insight Inc. 3004 SW First Ave. Portland, OR 97201 Schlumberger Drilling and Measurements 2525 Gambell Street #400 Anchorage, AK 99503 Baker Oil Tools 4730 Business Park Blvd" #44 Anchorage, AK 99503 Gordon Severson 3201 Westmar Cr. Anchorage, AK 99508-4336 James Gibbs PO Box 1597 Soldotna, AK 99669 Richard Wagner PO Box 60868 Fairbanks, AK 99706 Williams Thomas Arctic Slope Regional Corporation Land Department PO Box 129 Barrow, AK 99723 ) David McCaleb IHS Energy Group GEPS 5333 Westheimer, Ste 100 Houston, TX 77056 George Vaught, Jr. PO Box 13557 Denver, CO 80201-3557 John Levorsen 200 North 3rd Street, #1202 Boise, 10 83702 Michael Parks Marple's Business Newsletter 117 West Mercer St, Ste 200 Seattle,WA 98119-3960 David Cusato 200 West 34th PMB 411 Anchorage, AK 99503 Ivan Gillian 9649 Musket Bell Cr,#5 Anchorage, AK 99507 Jack Hakkila PO Box 190083 Anchorage, AK 99519 Kenai National Wildlife Refuge Refuge Manager PO Box 2139 Soldotna, AK 99669-2139 Cliff Burglin PO Box 70131 Fairbanks, AK 99707 North Slope Borough PO Box 69 Barrow, AK 99723 'ublic Notice Storage Injection Notice (Pretty Cr~ek) ) j Subject: Public Notice Storage Injection Notice (Pretty Creek) From: Jody Colombie <jody _ colombie@admin.state.ak.us> Date: Thu, 23 Jun 2005 12:05:27 -0800 To: ·undisclosed..recipients:; 'ublic Notice Storage Injection Notice (Pretty Creek) ) ') 20f2 6/23/2005 12:05 PM ~otice 1 of 1 ) ) Subject: Notice From: Jody Colombie <jody_colombie@admin.state.ak.us> Date: Thu, 23 Jun 2005 12:03:10 -0800 To: Legal Ads Anchorage DailyNews <legalads@adn;com> Please publish on Friday. Jody Content-Type: applicationlmsword Ad Order form.doc Content-Encoding: base64 Content-Type: applicationlmsword Pretty_Creek Storage.doc Content-Encoding: base64 6/23/2005 12:05 PM #5 ) Unocal Alaska ) Union Oil Company of Ca .,nia 909 West 9th Avenue, P.O. Box 196247 Anchorage, Alaska 99519-6247 Telephone (907) 276-7600 Fax (907) 263-7698 UNOCALe ..fUN ~] g Z005 Kevin A. Tabler, Manager Land/Government Affairs June 22, 2005 Mr. Tom Irwin, Commissioner Alaska Department of Natural Resources 550 W. 7th Avenue, Suite 800 Anchorage, AK 99501-3560 RE: Cook Inlet Area State of Alaska Pretty Creek Unit Amended Gas Storage Lease Application Dear Commissioner: Union Oil Company of California (Unocal), as operator of the Pretty Creek Unit (PCU), submitted an application for a Gas Storage Lease May 11, 2005. After further technical review and discussion with the Division of Oil and Gas staff, Unocal is now proposing an amendment to said application. The gas storage reservoir area will be expanded to cover a total of 2059.33 acres. All lands affected by this application continue to lie entirely within the PCU and are depicted on the attached revised Exhibit A. The proposed lease area is more particularly described as follows: ADL 63047 T14N-R9W Sec. 29: E1/2SE1/4 (80 acres) ADL 63048 T14N-R9W Sec. 28: SW1/4, S1/2SE1/4 Sec. 33: All r..:' '''~.i'. ;":. - ~. ,.,: '..' ~ (880 acres) "d0~~: . "I, JUN 2 2 2005 C,¡,j::)!~)',: c;;- ()~ L~ I-\¡\¡ () t:3/\~t~~ ) ) Pretty Creek Unit Amended Gas Storage Lease Application June 22, 2005 Page: 2 ADL 63049 T14N-R9W Sec. 33: E1/2E1/2 (160 acres) ADL 58810 T13N-R9W Sec. 34: NW1/4NW1/4, S1/2NW1/4, N1/2SW1/4, SW1/4SW1/4, Excluding U.S.Survey 2156 (219.33 acres) ADL 58813 T13N-R9W Sec. 3: W1/2NW1/4, NW1/4SW1/4 Sec. 4: N1/2, SE1/4, N1/2SW1/4, SE1/4SW1/4 (720 acres) Total Lease Area: (2059.33 acres) By transmittal letter to Mark Myers dated June 20, 2005, Unocal submitted a revised copy of our Injection Order Application which contains a thorough technical discussion of the geologic and engineering merits of this revised proposal. Should you have any technical questions, please do not hesitate to contact Jeff Smetanka, Reservoir Engineer. For any other questions please contact the undersigned at (907) 263-7600. Sincerely, Union Oil Company of California , B~ _W-tA2J~~ evin A. Tabler Its Attorney-in-Fact Enclosures cc: AOGCC UNO CALi> ,,~~-- Alaska Miles 0.5 I 0.25 0 0.5 , Pretty Creek Unit Gas Storage Lease Area 8 ADL389520 , ADL389932 BÆ ,,_ _07---' i . . ,...-.-"'" ~""'~W"" "... U¡"" ','-' - ." - '.n, ...¡ . 'I --'",\-l ,- - ......,~~"- h ::... " ADL05881'3 4 5 ADL058814 L f'" -, ../.;, ~::,:",;¡.:~'j~';'"-~::!f.¡f;,~ ,.'1-,".' ~ ~ "" ,^"" .-" ~'.' 'c. "'":1'....'" ~." .:or ~-'._~ "... . H. ..' "- ,-,_- ,_, .". ',~, ' ,,_ -,.............~..........C"..".'.."'!"-r".._......"..1 ~~;;!c;,~\i;.~ 'i' : ,', : ::::',;: ~;i 'I:~;¡)'-' fJi"" ,:i " .. " "', I ~' ',',,' '.,'. '11"\'" ',,' ,\ AD L063047 ' " "", , \(",I{~.", ",',\1 . ._'. .. , . _"' ,~ L\,\', I'~'\ ..c. II'"..' I'~ ,~~ f·,· ..,':'¡.., "1.'-·~"'""·''"'U''''_'_. r¿""","".".,.A.{." " I ,. t '1\1' ".1'. 'I' " ii' . '1 [¡.! D ::~:,I): . ;\'''-::';:;;:', 1 r- .~:.-5 I fl.. -., -"-"~ ___.1 I,"'''''"',''·",'.'',,,'', ., ,",.'" , . " ."",,'1,".,''',,,'',,:.,,' ',,',~~, ~ ,"'¡ ·',,:,',I\:":,'!":"¡:\:·; ..:",':' ":¡ .~" I ;;"'/:":':~·'Y,,,:..:"'" ',,," ',' " '.'}.,,',,:;, ,,'::, ,',(' "A,,:'~.,,~,L390104 , ~I,,'"::::: ".,I!('·:::'AD'L058810", '"".,," 3I~ . ( 'I'.. .I,~- ," . ,.1"1 "," . I. I ' " I . . ,- " ,J AJ:)~Ð6ßÐ4'8 ~,I.II '", ~:1 1 " i . . '-,.l~I.;I".;a.f;l_~·:., ,,'.," . ".,;1,~I\:" ..::",,1. ,,"" ~ I' , .:' ,>:',",)' ',' " ~[ i ,l. ',,,c,,,,r L~ ,'. >, J~ ',J :;:t: >-\ .: .:< ~';'.:,! .' ~~fNr;;i~: \",I~MI11I';' II~fI1!i\IN\,jll~'O¡J"~I,~:'·'j¡~'I.<I:'j'fI(~~ I 1 ' . ':'\ ,I L '.,' 'J 11.' I ' I ADLØ'-6304932 33 ",:'~).~~;~,':~~~ .', "', i. ~ ~\I':'" ,~·n'·';·,~~I' ';f~~';"~' t ,J~·..~II:IIR~~t.;:~¡:~ "';--... ,.( L.. .S ¡~..~. ;'.""~~~Ir .~~ I.~~\.,~~~ -" - ~ '·'\~~",IIIi!'~'\;J~'>,ß. ;~J\:~ "'.'·1'''\~~' '1~~,1~1!~~ rl.,'.. ...d ~ 'j' ~~r;~ ~.: p~ ~I . .. A~ ..1:-; I.~~.n ':q, '. ~~. I¡\~/I ~. I u~ , ~~~jJt¡!~!f~ "'~~' .\':i ...:~if¡J¡i¡~~~~. ~1~1'~I,.~¡~·.'I¡\j~,1.j~t,;,(ij ¡l~~I\~i~~H' :\....:.".','..'~,.',., "". ~I"~ '"'...'\,~~", :.~ "''- ¡'r' \~~' ,1, "'!,¡t1 ,'~i~I~~~ I~~ :¡~~:~:~.' ¡l;Ai~ i' ;~1:¡¡;'t'~1~;:¡ I ~~~ I t ~ '1 T14NfR9W ~ T13N R9W i- AOL390102 ADL390103 f\mended Exhibit.A ) Pretty Cr.· Gas StoraQe Reservoir Area , í #4 ) " Unocal Alaska ) Union Oil Company of Cairo J,nia 909 West 9th Avenue, P.O. Box 196247 Anchorage, Alaska 99519-6247 Telephone (907) 276-7600 UNOCAL8 R'I" F.P- C^~ ~ ~ "~t:"EIJ\/E[) JUN 2 0 2005 em & June 20,2005 Ms. Cathy Foerster Mr. Dan Seamount Mr. John Norman Alaska Oil and Gas Conservation Commission 333 W. 7th Avenue, Suite 100 Anchorage, AK 99501-3539 APPLICATION FOR STORAGE ORDER FOR PRETTY CREEK GAS STORAGE FACILITY Dear Commissioners: Attached for your review are two copies of our revised Application for Injection Order for Gas Storage for the Pretty Creek Gas Storage Facility. The application is submitted by Union Oil Company of California (dba Unocal). Tom Maunder, of your agency, reviewed our initial submittal and notified us of several errors or discrepancies, which we have now corrected. Please contact me at 263-7622 if you have any questions regarding this application. SinCerelY,., _n. '~'I~ ~~lme~nk: Consulting Reservoir Engineer JWS:dma Attachments cc: Kevin Tabler ,I ) APPLICATION FOR INJECTION ORDER FOR GAS STORAGE PRETTY CREEK GAS STORAGE FACILITY TABLE OF CONTENTS Section/Regulatory Citation Subject Paae A. 20 MC 25.252(c)(1) Plat information 3 B. 20 MC 25.252( c )(2) Operators/Surface Owners 3 C. 20 MC 25.252(c)(3) Affidavit 4 D. 20 MC 25.252(c)(4) Description of Operation 5 E. 20 MC 25.252(c)(4) Storage Zones 5 F. 20 MC 25.252(c)(4) Geologic Information 5 G. 20.MC 25.252(c)(4) Production History 6 H. 20 MC 25.252(c)(5) Well Logs 7 I. 20 MC 25.252(c)(6) Mechanical Integrity 8 J. 20 MC 25.252(c)(6) Casing Information 8 K. 20 MC 25.252( c )(7) Injection Fluid 9 L. 20 MC 25.252(c)(8) Injection Pressure 10 M. 20 MC 25.252(c)(9) Fracture Information 10 N. 20 MC 25.252(c)(10) Formation Fluid 10 o. 20 MC 25.252(c)(12) Wells Within Area 10 1 Number 1 2 3 4 5 6 7 8 9 10 11 12 13 14 ) } PRETTY CREEK FIELD APPLICATION FOR INJECTION ORDER FOR GAS STORAGE PRETTY CREEK GAS STORAGE FACILITY LIST OF ATTACHMENTS Description Regional Cook Inlet Location Map PCU #4 Location Map, 51-5 Sand PCU #4 Location Map, 45-0 Sand PCU #4 Well Log Section Showing 51-5 Sand PCU #4 Well Log Section Showing 45-0 Sand PCU #4 Production Chart - Gas and Water Rates Material Balance Plot: P/Z vs Cumulative Gas Current Wellbore Schematic for PCU #4 Leak-off Test at Surface Casing Depth (9 5/8") for PCU #4 Leak-off Test at 7" Casing Depth for PCU #4 Sample Gas Analysis from Pretty Creek Field Sample Gas Analysis from Steelhead Platform GGS PCU #4 Water Analysis, 5/17104 Sample PCU #4 Water Analysis, 5/26/05 Sample 2 ) ) PRETTY CREEK FIELD PRETTY CREEK GAS STORAGE FACILITY APPLICATION FOR STORAGE INJECTION ORDER June 17, 2005 Introduction Union Oil Company of California (dba Unocal) requests a storage injection order for a gas storage project within the boundaries of the Pretty Creek Gas Field. Unocal specifically requests permission for storage injection operations into the Beluga 51-5 and Sterling 45-0 sands, which are present in the PCU #4 well. After obtaining all necessary approvals, PCU #4 would be converted to gas storage service. Additional wells would possibly be drilled or re-drilled to these same sands in the future to increase deliverability from the storage facility. Section A - Plat Attachment 1 is a regional map showing the location of the Pretty Creek Field relative to other fields in the Cook Inlet area. Attachments 2 and 3 are plats showing the location of the two proposed gas storage reservoirs in PCU #4: Beluga 51-5 and Sterling 45-0, respectively, and the surrounding wells in the Pretty Creek Field. Section B - Operators/Suñace Owners The surface owners and operators within the area of this injection order and extending one-quarter mile beyond the boundary are: · Unocal · State of Alaska Department of Natural Resources (DNR) The following surface and mineral owner lying outside the storage area but within the existing production unit was also furnished a copy of this application: · Francis H. Grant Family Trust 3 ') ) . Section C - Affidavit Affidavit of Samuel Atta-Darkwah STATE OF ALASKA THIRD JUDICIAL DISTRICT I, Samuel Atta-Darkwah, declare and affirm as follows: 1. I am over 19 years of age. I am employed by Unocal as a Reservoir Engineer. have personal knowledge of the matters set forth in this affidavit. 2. On Y tA.tJ'ê 2..D I'"t , 2005, the surface owners/operators listed in section B were provided a copy of this permit application. DATED at Anchorage, Alaska this :r "" \V e , 2005. Go. 0 -al day of /þ~ Samuel Atta-Darkwah Subscribed and affirmed before me at Anchorage, AI~a on ( Cìuu.., d-(J , 2005. T-- -- /' I ? . ~ U/'- Notary Public in and for the State of Alaska My commission expires: b'. z,ðf . ~ 4 ) Section D - Description of Operation ) Unocal proposes injecting gas into two gas sands for gas storage purposes. Unocal intends to initially use the Beluga 51-5 sand for storage. This sand is expected to be depleted or nearly depleted at the time of gas storage commencement. Unocal may later expand storage operations into the Sterling 45-0 sand. Initially, the PCU #4 well will be used as the sole well for gas storage operations (both production and injection). Unocal may later decide to drill a new well or re-drill the PCU #2 well to expand storage deliverability from one or both of these reservoirs. The storage gas will be injected during periods of excess supply and produced back during periods of increased demand to help balance gas deliverability requirements. Section E - Storaae Zones The Beluga 51-5 sand (primary target) and the Sterling 45-0 sand (secondary target) are the proposed zones of injection. The primary target comprises a stratigraphic interval, the top of which correlates to depths defined in the following Pretty Creek Field wells: Well PCU4 PCU2 PCU 224-28 51-5 Sand Top (MD) 5144' 3671' 3902' Similarly, the 45-0 sand is penetrated as follows: Well PCU4 PCU2 PCU 224-28 45-0 Sand Top (MD) 4503' 3270' 3451' Section F - Geoloaic Information 51-5 Sand (TVDSS) -3585' -3586' -3630' 45-0 Sand (TVDSS) -3185' -3185' -3195' All gas production from the Pretty Creek Field has come from the Sterling and Beluga Formations. The Sterling Formation is the shallowest, extending in PCU #4 to a depth of approximately 3645 TVD feet. It is comprised of interbedded sands, silt, mudstone, and coal. The Sterling Formation was most likely deposited in a higher-energy meandering to braided stream environment. Underlying the Sterling is the Beluga Formation. These sands were probably deposited in a lower energy stream system and are likely to be laterally discontinuous. As with the Sterling Formation, these low-energy Beluga sands are inter-layered with abundant " mudstones and coals. The Beluga low-energy section is approximately 900 feet thick at Pretty Creek Field. 5 ) ) Although gas production has not been established in the Tyonek sands at Pretty Creek Field, historical DST testing in PCU #2 determined that marginal and non-commercial quantities were present in this formation. The Tyonek Formation is comprised of meander belt and braided stream sandstones interbedded with mudstones and thick coals and is 4300 feet thick at Pretty Creek Field. Beluga 51-5 Sand The 51-5 sand is a Beluga channel sand that is currently on production and is being depleted by the PCU #4 well. The sand appears to grade to overbank silt and finally to silty mudstone in the PCU #2 and PCU 224-28 wells, respectively, suggesting that there should be a channel boundary between PCU #4 and PCU #2 as the channel disappears to the no rth. The attached log section for PCU #4 (Attachment 4 ) shows the 51-5 sand at depths from 5144 to 5173 feet measured depth (MD). The sand is overlain by 10 MD feet of interbedded siltstone, clay-rich siltstone and mudstone, creating an impermeable barrier above; there are no permeable gas sands immediately above this interval. The sand is underlain by 21 MD feet of shale and shaly coal. The shaly coal grades to solid coal (PC4Coal pick) with depth; this 10-foot coal acts to seal off the 51-5 sand from possible permeable sands below. The PC4Coal is laterally extensive and easily picked in other wells across the field. . Sterling 45-0 Sand The 45-0 sand is a Sterling sand in PCU #4 that has been produced and depleted. The sand appears to pinch out to the north as it becomes thinner and increasingly silty and shaly towards the PCU #2 and PCU 224-28 wells. Consequently, the 45-0 sand is not considered to be a gas reservoir in either of these two wells. The attached log section for PCU #4 (Attachment 5) shows the 45-0 sand at depths from 4503 to 4518 feet measured depth (MD). The sand is encased by coal above (36 MD feet) and below (33 MD feet). This thick coal is commonly referred to as the BelugaCoal (despite it being Sterling in age). The BelugaCoal is laterally extensive and is also penetrated by fields to the north (Lewis River) and east (Ivan River) of PCU #4. The coal acts to seal off the 45-0 from any permeable sands above or below. Section G - Production History The PCU #4 well was drilled and completed in November 2001. Three gravel packs were installed, with one each in the Beluga 51-5, the Sterling 45-0 and the Beluga 55-6. A single 2-7/8" production tubing string was run. Sliding sleeves were installed across each interval to enable zones to be opened or closed as required. 6 ) ) Attachment 6 shows the production history of the PCU #4 well. The well was produced the first winter with all three sands open and commingled. Peak gas production from the well occurred on 2/18/02 at 7.82 MMCFD at 975 psig flowing tubing pressure (ftp). In April 2002, diagnostic work was performed on each interval. It was determined at that time that the bottom interval (Beluga sand from 5,566' - 5,577' MD) was not contributing to flow. After the diagnostic work, the well was returned to production in both the Beluga 51-5 and the Sterling 45-0 sands. In November 2003, compression was installed on the pad to provide for lower flowing tubing pressures and additional recovery of reserves. Upon startup of the compressor, it became apparent that the water rate had increased significantly. Water rates continued to increase up to 14 bwpd rate. In April 2004, the well was shut in for compressor repairs. Attempts to return the well to production were unsuccessful. The sleeves were then shifted to determine if reliable gas production could be achieved. It was determined that the Sterling 45-0 sand had watered up and would not flow. The Beluga 51-5 sand was able to flow gas when produced in isolation. The well was returned to production in May 2004 from the Beluga 51-5 sand only. Initial water rates were high - in the 14 bwpd range. These water rates slowly decreased, giving indication that the zone was producing back water that had cross-flowed into the reservoir from the Sterling interval. The water rate eventually decreased to a 1 bwpd rate. The well continues to produce 1.5 mmcfd and 1 bwpd at 270 psig flowing tubing pressure. Estimates for original gas in place for the Beluga 51-5 sand were determined by analyzing the material balance plot (Attachment 7) for the post April 2004 period when the zone produced in isolation from the Sterling interval. Note that the P/Z vs. cumulative gas produced plot for this time period is a straight line, indicating volumetric type depletion or a weak aquifer at most. By extrapolating this straight line back to the original reservoir pressure for the sand, we constructed a theoretical plot for the zone had it produced in isolation over the entire depletion period. Using this approach, it is estimated that the original gas in place for this zone is 2.07 bcf. For the Sterling 45-0 sand, single zone depletion data was not available. For this reservoir we calculated the zonal cumulative gas production (1.29 bcf) by difference using the total for the well and the 51-5 zone estimates. Section H - Well LOQs All open hole logs from wells in the Pretty Creek Unit were sent to the Commission once the logs were completed. Attachments 4 and 5 show log sections for the proposed injection intervals in well PCU 4. 7 ) ) Section I - Mechanicallntearitv The PCU #4 well will be tested for mechanical integrity using the standard 30 minute annulus test per 20 AAC 25.412. To confirm continued mechanical integrity, Unocal will monitor daily injection rates and pressure and notify the AOGCC the next working day if the rates and pressure indicate pressure communication or leakage in any casing, tubing or packer. The rate and pressure data will also be reported to the Commission on a monthly basis. Section J - Casina Information The current wellbore schematic shown in Attachment 8 will remain the same after gas storage operation commences. The sliding sleeves governing flow from the Sterling 45-0 and Beluga 55-6 sands will remain closed, and the sliding sleeve governing flow from'the"Seluga 51-5 sand will remain open. The casing in PCU #4 was cemented in accordance with 20 AAC 25.252(b) and tested in accordance with 20 AAC 25.030(g) when completed. The first hole section (12 ~") in PCU #4 was drilled and subsequently completed with a 9-5/8" casing to a depth of 2,398' MD. The 9-5/8" casing shoe was pressure tested with 1500 psi surface pressure. A leak off test (LOT) was performed at the shoe (Attachment 9), 2,398'MD/1 ,977'TVD and yielded a leak-off pressure of 1000 psi and a fracture gradient of 0.99 psi/ft. The casing was cemented with 237 bbl of cement (210 bbl of 13 ppg lead slurry and 27 bbls of 15.8 ppg tail slurry) with returns to surface. The next hole section (8-1/2") was drilled and completed with 7" casing to a depth of 6,941' MD/5,1 04' TVD (TD is at 6,954' MD/5, 114' TVD). The primary cement job on the 7" x 8-1/2" OH consisted of 106 bbls of 12 ppg LITECRETE. The cement was pumped with full returns and 2200 psi pressure test on plug bump. An Ultrasonic Imager Cement Bond Log (dated 11/4/01) showed good bond from 6918' up to +/- 5,900'. Based on the volume of cement pumped and full returns, the hole was apparently washed out to an average size of 11.6". A leak-off test was performed at the shoe (Attachment 1 0), 6,941'MD/5, 1 04'TVD and yielded a leak-off pressure of 1465 psi and a fracture gradient of 0.82 psi/ft. The 6" hole section was drilled from 6,954' - 9,580' MD to evaluate Tyonek potential, but no zones of interest were encountered. Cement retainers were set at 5,581' and 6,862' to plug off this lower section. The 7" casing was perforated from 5,594' MD to 5,596' MD with 4-1/2" perforating guns. Full circulation was established down the 7" casing with returns from the 7" by 9-5/8" annulus, and the old mud was displaced with new mud. A cement retainer was set in the 7" @ 5,584' MD. The 7" was remedial cemented with 230 bbls, 1130 sx, of 15.6 ppg class G cement with 12 bbls cement return at surface. Full returns were observed while 8 ) .) cementing. Based on volumes of cement, the 7" casing by open hole was washed out to ..... 10". No subsequent cement evaluation tools were run post remedial cementing. The well was subsequently completed with 2-7/8" production tubing to 4,372' MD/3,196' TVD and three packers and gravel pack assemblies (as well as three Baker CMD Sliding Sleeves) at 4,521' MD, 5,173' MD and 5,576' MD. Full zonal isolation is believed to be present in PC #4. As noted in section G of this application, commingled production occurred from Beluga 55-6 and 51-5 sands, and Sterling 45-0. The Beluga 55-6 sand was isolated and production resumed in the Beluga 51-5 and Sterling 45-0 sand. The Sterling 45-0 sand was isolated with the Sliding sleeve and production from the Beluga 51-5 sand continued. The Straight line P/Z curve on the Beluga 51-5 only sand shows both a volumetric reservoir and no behind the casing fluid migration. In summary, Unocal believes there to be sufficient zonal isolation to allow for gas storage. The opinion is based on the success of the remedial cement job on the 7" casing and the P/Z data on the Beluga 51-5 sand. Section K - Injection Fluid The type of fluid for proposed injection is dry natural gas, which is predominantly methane. It is intended to use the Pretty Creek Storage Facility for the injection of excess gas owned by Unocal; however, it is likely that the physical molecules of gas may be sourced from the Beluga River Field or from other West Side properties operated by others. The source of the Unocal owned and operated gas would likely be from the Grayling Gas Sands on the Steelhead Platform in the McArthur River field Attachments 11 and 12 are representative gas analyses for gas produced both from the PCU #4 well and from the Steelhead Platform Grayling Gas Sands. The compositions of the samples are very similar, with a specific gravity of 0.57. The Beluga River gas also has a very similar composition. Since all expected sources of gas are predominantly methane and are very similar to the original gas in the reservoir, no fluid compatibility problems are expected. The estimated maximum amount of gas to be injected daily is 20 mmcfd. 9 ) ) Section L - Injection Pressure Compression will be used for gas injection and production operations. The estimated average injection pressure will be 1550 psig. The maximum injection pressure will be 2500 psig. Wellhead injection pressures will be maintained such that a gradient of 0.65 psi/ft at the target midpoint of perforations depth of 3,686' TVD (51-5 sand) is not exceeded. This corresponds to wellhead pressures of approximately 2200 psig with the well shut in and 2500 psig at a 10 mmcfd injection rate. Section M - Fracture Information The proposed maximum injection pressures for the gas storage operation will not initiate fractures in the confining strata which might enable the injection or formation fluid to enter freshwater strata. The proposed maximum injection pressure for PCU #4 in the . Beluga 51-5 sand, as previously mentioned, will not exceed a gradient of 0.65 psi/ft at the sandface. As stated in Section I of this document, leak off tests conducted while drilling PCU #4 in November 2001 (Attachments 9 & 10), show the fracture gradient at 1,977' TVD and 5,104' TVD to be 0.99 psi/ft and 0.82 psi/ft, respectively. Original reservoir pressure in the Beluga 51-5 sand in PCU 4 is estimated at 1659 psi based on a normal pressure gradient. Section N - Formation Fluid Attachments 13 and 14 are laboratory analyses of produced water samples from the well collected on 5/17/04 and 5/26/05, respectively. Based on the production history of the well, it is believed that the sample taken on 5/17/04 is representative of the 45-0 zone and the sample collected on 5/26/05 is representative of the 51-5 zone. Section 0 - Wells Within Area As shown in Attachments 2 and 3, there are no wells that penetrate the Beluga 51-5 sand and Sterling 45-0 sands within a quarter mile of the proposed PCU #4 well. 10 . , , . . , . 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I I Cook Inlet Regional Map N ) è . ) PCU #4 Location Map, 51-5 Sand (Depth values in TVDSS) N 3æJ, øøø N 8i2,ØBØ 3i7 I äø N ~ ISJ ~ IS) IS! oS! 29 28 27 N -'jfj1pCU 224.-28 1'-.:1 · a:. C') (f1 Ul -..1 _ + _-.J . · ~ IS) ISJ IS! ~ IS) Quarter mile: radius around 51-5 p~netration -356~CU 2 in PCU-4 ,well 32 \ .33 34 1\ I\) í N 0') (1) (f1 Ul N _ - _1'-.:1 · CãI -3565 - ISI ISJ IS! ~ IS) :¢PCU 4 5 .. 3 I\) N 0') (1) þÞ ..Þ ~ --.] j ~, Ø00 ji2,0BØ ji7.1@9Ø oS! oS! CãI ISI 1 :60()(1 ~EE'f' 1 1 (1r' ZOrO?EET Attachment 2 ',) 8 ~. 121121 121 ',) ~.- IS' IS 29 N m (.Il ...J _ ~ IS' ~' ) \ } PCU #4 Location Map, 45-0 Sand (Depth values in TVDSS) . Quarter mile ràdius :around 45-0 penetration : in PCU-4 w~1I 92 N 0') (.Il N _ IS'! IS' ~ 5 N . 0') .¡::. ~ ð ~. 121121 121 ðJ .:5;1 \ \ -SIB51 \,' ~ 8i2.I2IØø 28 fCU 224--28 -8191 + fCU 2 -318' 33 PCI 4 .q. 4 ði2.øØø 1 :800D FEET ~ ' r zoiC FEET N 8i7.äø N .. IS> IS! oS:! 27 N .. en U1 _-..J IS> IS! IS> 34: N 0) U1 _N ISI IS! oS> 3 N 0) ¡.þ -J ði7. ~ø 5) ISI Attachment 3 Log Showing 51-5 Sand II PCU-4 We ----1'Ri c' '> ~ \ r.cc ~~=-.:::;:;~~::",::~'r .¿ ¡ ¡ _~6G ( _J [- J ( -....... --...... /" Atta(:hment 4 - --r~-: -.:;~----_._----_._--------_. ~~.J...,?i!ir.c::-~:-"--- I ¡ . ?>I ~ &:"1 5.$. !:3nd --=,_£~, "U9iõ ·"..··....'.-.-··.·t ¡ ¡I,~r-·..--.......·TIf_.~_,..-w....-~-.æ~~, -...,,- ~ a';::' ""'L ~,,4;I,,~ - ~_.....""_.'ff-~I ~ · ~.;::::.I-..'."""..,...""-V"".."'.\r~"'....-".... ." 7! .--'F of." _ ,~.,._-,..~.:'~J'ir---'--~ ~ ,. ~ t"')' ~ .r-" ~ ~~ ~ I ~ ~ Jr -~ .r'" ~ . "- 1 J o ~~ ..r ~ .- - -~--~ ~ M~ l.-. ~"J EF'G ~...f.- ~" L (.;. ,;:~ fH .1...... ~ '). .~ ~ -'a :;.> ~) "\.. ,.......::> ,ë# -.:~) ~.. ~ 1. RHº8 HU)~' o o ..... ..... , ~'1'---- 30 ß~lugo 51-5T _ ."Ü .,.. _,,";.. ~.. . ..r._ .. ~( "'~""'-L ...............;.'1t'1 P (, 4':v", 1 PC5Coo I --~ - ---:z-- ----- .....--. - ~'~ ~ - ~E'J .Ê-~ ~~e.~ f>SR A1f~ ~.. ~ ~'. ~2 - ',,",--, ., ç:.. . ~.~-. ....1 "6~, Vfè.ss ~~g'()<k f 10 ~ .. . o '0 r .. "I J o . ~ ~ .., o g·o If) 0 If') ..... J o o - In (I) _ pH- - --- ------ C·R_C 011 ~ .... ~ 7'1'",. ,.. OJ ~.,~ ¡ ø~ :i- ~ - > R.t:'fl'"~-"<?J : _>=~ - I - : : - - - {\c~ . ,..___..,I.L~\ku.ll . _....,....,-~ ........< .. ..".,. ~~"..""{,.,i"L~_·¡''1'--''-,~. "'4' ~.;.¡,,:_'·'O..:~t;-a· ·n- ·d~ ~"!.I,- ,~.~~;=::;."._.L'.;"~'~Cn{A__'i'.~~~¡":::.' -, '~:"C'~~L___--__-_·__.";-.·.-'" - .~.........- . ."- . ~ ~ t V V _.~ - _~ ~""-'-. ~.,_-... . .<,-;;::....._,~-~.~.~, I . :~ -----~ ----- - - -. {--~ , ~ .. ..;.'=c----:~-,. _ ç ~- :l 411....&....._ r.----'--,. ---- - ----- _,J> ~~~--~-'---'ñ'i (..~( olt (> -~ l'.t-. ~ . I ~ " Q r ~ I n ~ --r- ,+,. - - _I- ! . ~ -"-.- - -c;.: .t-c I I ra 9 l "'-'I Qr -. " PC. 1 Cnnl -.t: . - .. 1 PCU-4 Well Log Showing 45-0 Sand ~ .~ t.Ü oJ':~ ·ftti... '- ~E' ~- }' ;,~,,~~ CloUt f~lM _ ,,,;;·t 10.., '~~ð )} _._-..~ "": ...--~ ~_A- _ 4S -.. .~.~,. . ^ t - - L g - .'1 ~ - 'g ~:;. t ... .. - - - - - .. - , § - .. § .. ... \ }// :¡s \ Attachment 5 _.- _ --- --I:d- -~---~ ------ - -~ - - ---- ---- -- -...-~ -..,...----~--- -'" --~ .----~""----- --- ------~--~-""' ª ..' R!. .. . , .,.;:;¡. , -~ . ,-~..... ~ PCU #4 Production Chart - Gas and Water Rates 12000 --- Gas Rate --$- Water Rate 10000 8000 :E (.) E cD 6000 ... co 0::: I t/) co C> 4000 2000 o Jan-01 Jan-02 ---- 20 . þ Production from Beluga 51-5 only ~ - 15 . o "C C. ~ .c Cñ - t/) () 1 0 !::. () ... co 0::: ... () - co ~ -' o Jan-03 Jan-04 Jan-05 ATTACHMENT 6 2000 1500 .! ø Q. 1000 ~ 0.. 500 o o PCU #4 Material Balance Plot 4 (P/Z vs Cumulative Gas) .51-5 and 45-0 commingled . 51-5 '~ . --------------------------------------------------------------------- _r' 1 2 5 3 4 Cum Gas, bcf ATTACHMENT 7 UNOCAL6) Tight spot in tubing at ~1150' WLM (4/17/03) 1 -/ A I I;: I I ~ I'¡ " 2 3 1l ~ 4 5 ~ ;~~ II 11 JHf-m ~__IV I~V -;jt;- : ~ 'ì: == : ~ 'i: - .,... ~II VI 6 7 8 9 L ~ L' ") SIZE WT 13-3/8" 9-5/8" 47 T' 29 Tubing 2-7/8" 6.4 2-3/8" 4.6 NO. Depth I 4521 II 4560 III 5173 IV 5212 V 5319 VI 5576 5581 I 2 4,372' 3 4,501 ' 4 4,526' 5 5,147' 6 5,181 ' 7 5,554' 8 5,584' 9 6,862' A 2,517' }.etty Creek Well No.4 Actual 05/05/04 CASING AND TUBING DETAIL GRADE CONN ID L-80 Butt L-80 Butt L-80 Butt SC L-80 Butt SC JEWELRY DETAIL OD Item Production Tubing Inner String Jewelry Baker CMD sliding sleeve Baker "X" nipple Baker CMD sliding sleeve Baker "X" nipple Baker "X" nipple Baker CMD sliding sleeve Bull plug - end of tubing ID 2.313 2.313 2.313 2.313 2.313 2.313 3,170 3.24 3.17 3.24 3.117 3.17 TOP Surtàce Surtàce Surtàce BTM. 75' 2,398' 6,941 ' 4,372' 2,517' Packers, Screens, Misc. Dual Tubing Hanger, 2-7/8" x 2-3/8", 11" 5M SC-l Gravel Pack Packer Baker Weld Wire Wrapped Screen SC-l Gravel Pack Packer Baker Weld Wire Wrapped Screen SC-I Gravel Pack Packer Baker Weld Wire Wrapped Screen K-l Retainer K-l Retainer with 12 bbls cement below and 5 bbls above. Heater String 2-3/8", L-80, Butt SC PERFORA TION HISTORY Interval Accum. Date Zone Top Btm Amt spf Comments 11/14/2001 Sterlin~ 4,507' 4,514' 7' 12 11/17/2001 Belu~a 5,152' 5,172' 20' 12 11/24/2001 Belu~a 5,566' 5,577' 11' 12 SLIDING SLEEVE HISTORY SS Depth 5/4/2002 9/21/2002 4/30/03 4/9/04 4521 closed open open open 5173 open open open? closed 5576 closed closed open closed TO = 9,502'M0/7,600'TVO Max Hole Angle = 51 deg ATTACHMENT 8 Pretty Creek Field PC #4 9.625" LOT UNOCALe DATE: 10/16/2001 Strokes I Volume Pump Time FOREMAN D Fowler Pumped Pressure FIELD: Pretty Creek (BBLS) (psi) (min) PLATFORM: 0 1.00 200 4,0 WELL: PC #4 1.25 250 5,0 1.50 300 6,0 SIZE: 9.625 IN 1.75 350 7,0 WEIGHT: 47.0 LBS 2,00 400 8,0 GRADE: L-80 2.25 450 9,0 BURST: 6,870 PSI 2.50 500 10.0 MAX. PRESS: 5.496 PSI 2.75 550 11.0 TEST PRESS: 1,500 PSI 3.00 600 12.0 3.25 650 13.0 CSG DEPTH (MD): 2,398 FT 3.50 700 14.0 CSG DEPTH (TVD): 1,977 FT 3.75 740 15.0 TD (MEASURED): 2,398 FT 4,00 780 16.0 TD (TVD): 1,977 FT 4.25 810 17,0 FLUID TYPE: POLYMER MUD 4.50 850 18,0 MW: 9.30 PPG 4.75 895 19.0 INCREMENTS: 0.25 BBLS 5.00 940 20.0 PUMP IN RATE: 0.25 BPM 5.25 950 21.0 LEAKOFF(GRAPH): 1,000 PSI 5.50 970 22,0 LOT OR FIT?: LOT 5.75 990 23.0 FRAC GRAD: 0.989 PSIIFT 6.00 1000 24.0 EMW: 18.40 PPG 6.25 1000 25,0 6.50 1000 26,0 IKB - MSL FT 830 27,0 KB . MUD LINE FT 730 28,0 ICOR FG.: 0.99 PSIIFT COR EMW: 19.03 PPG Note: .101 BBLS/STRK Copy of PC #4 9.625 LOT Pressure vs Volume 1200 ----~--------------,-~---~-'--.-----'---.-~-'-- 1000 800 600 400 200 1,00 2,00 ~" 3,00 Volume (BBLs) Pressure vs Time ._------_._~-- .J~' 4,00 5,00 6.00 7,00 1200 1000 . . \ 800 600 -~ 400 200 5,0 10,0 15,0 Time (Minutes) 20,0 25,0 30,0 ATTACHMENT 9 Pretty Creek Field PC #4 7"LOT UNOCALi) DATE: FOREMAN FIELD: PLATFORM: WELL: SIZE: WEIGHT: GRADE: BURST: MAX. PRESS: TEST PRESS: CSG DEPTH (MD): cSG DEPTH (TVD): TD (MEASURED): TD (TVD): FLUID TYPE: MW: INCREMENTS: PUMP IN RATE: LEAKOFF(GRAPH): LOT OR FIT?: FRAC GRAD: EMW: IKB . MSL KB . MUD LINE ICOR FG.: COR EMW: Copy of PC #4 7.0 LOT 10/28/2001 Strokes I Volume Pump Time D Fowler Pumped Pressure Pretty Creek (BBLS) (psi) (min) 0 0 PC #4 0,25 13 1,0 0.50 28 2,0 7" IN 0.75 61 3,0 29# LBS 1.00 176 4,0 L-80 1.25 338 5,0 8,160 PSI 1.50 502 6.0 6,528 PSI 1.75 679 7.0 3,000 PSI 2.00 844 8.0 2.25 1017 9.0 6,941 FT 2,50 1178 10.0 5,104 FT 2.75 1329 11.0 6,954 FT 3,00 1465 12,0 5,104 FT 3.25 1584 13,0 POLYMER MUD 3.50 1705 14,0 10.20 PPG 3.75 1810 15.0 0.25 BBLS 4,00 1895 16,0 0.25 BPM 4.25 1950 17.0 1 ,465 PSI 1835 18,0 LOT 1775 19,0 0.817 PSIIFT 1736 20,0 15.71 PPG 1650 21,0 Pressure vs Volume 2500 --~~-~--- 2000 1500 1000 500 Oil ~ 2500 2000 ~---- --~--------------- ----~----- --- ------.------ 0,50 1,00 1,50 2,00 2,50 Volume (BBLs) 3,00 4,00 4,50 3,50 Pressure vs Time 87,70 FT FT 1500 0.82 PSIIFT 15.86 PPG -' 1000 500 O. 5,0 10,0 15,0 Time (Minutes) 20,0 25,0 30,0 ATTACHMENT 10 ) Unocal Gas Analysis Report Location: Pretty Creek Unit #4 Facility 10: WSPC Analysis Date: 3/16/05 Btu/Cf: 1003.577 Gravity: 0.5630756 CO2 0.52107 N2 0.63934 Methane 98.77972 Ethane 0.04426 Propane Ibutane Nbutane NeoPentane Ipentane Npentane C6+ 0.01561 100.00000 ) ATTACHMENT 11 Unocal Gas Analysis Report Location: Facility ID: Analysis Date: Btu/Cf: Gravity: C02 N2 Methane Ethane Propane I butane Nbutane NeoPentane Ipentane N pentane C6+ Steelhead GGS (6105 meter) rBPF 6105 12/6/04 1003.235 0.568105 0.30862 1.45155 97.87396 0.16970 0.06731 0.01331 0.03390 0.08165 100.00000 ) ATTACHMENT 12 ) ) West Coast Region 5125 Boylan Street Bakersfield, CA 83308 (661) 325-4138 Lab Team Leader - Sheila Hernandez (915) 495-7240 Water Analysis Report by Baker Petro lite Company: UNOCAL ALASKA RESOURCES Sales RDT: Account Manager: MIKE PING (907) 252-4082 Region: ALASKA Area: KENAI, AK Lease/Platform: PRETTY CREEK Entity (or well #): Sample #: Analysis ID #: Formation: Sample Point: UNKNOWN WASTE WATER Summary 31100 316644 43439 Anions Analysis of Sample 316644 @ 75 of mgll meq/l Cations Sampling Date: Analysis Date: Analyst: 5/17/04 5/27/04 JAMES AHRLETT 344.74 24.88 O. 0.19 Chloride: Bicarbonate: Carbonate: Sulfate: Phosphate: Borate: Silicate: 12222.0 1518.0 0.0 9.0 TDS (mgll or g/m3): Density (g/cm3, tonne/m3): Anion/Cation Ratio: 22459.1 1.004 1 Carbon Dioxide: Oxygen: Comments: Hydrogen Sulfide: pH at time of sampling: pH at time of analysis: pH used in Calculation: 6,37 6.37 Sodium: Magnesium: Calcium: Strontium: Barium: Iron: Potassium: Aluminum: Chromium: Copper: Lead: Manganese: Nickel: mg/I 7787.2 52.0 90.0 0.9 6.0 228.0 546,0 meq/I 338.73 4.28 4.49 0.02 0.09 8.24 13.96 Conditions Values Calculated at the Given Conditions - Amounts of Scale in Ib/1000 bbl Gauge Calcite Gypsum Anhydrite Celestite Ba rite CO2 Temp Press. CaC03 CaSe ¡2~ 0 CaSe 4 SrS04 BaS04 Press of psi Index Amount Index Amount Index Amount Index Amount Index Amount psi 80 0 -0,58 0,00 -3.47 0.00 -3.53 0.00 -3,67 0.00 0.26 1.37 6.79 100 0 -0.46 0.00 -3.49 0.00 -3.49 0.00 -3.67 0.00 0,10 0.69 8.79 120 0 -0.33 0.00 -3.51 0,00 -3.43 0,00 -3.65 0.00 -0.04 0.00 10.93 140 0 -0.19 0,00 -3,52 0.00 -3.35 0,00 -3.63 0.00 -0,15 0.00 13.13 Note 1: When assessing the severity of the scale problem, both the saturation index (SI) and amount of scale must be considered, Note 2: Precipitation of each scale is considered separately. Total scale will be less than the sum of the amounts of the five scales. Note 3: The reported C02 pressure is actually the calculated C02 fugacity. It is usually nearly the same as the C02 partial pressure, ATTACHMENT 13 ) ) West Coast Region 5125 Boylan Street Bakersfield, CA 83308 (661) 325-4138 Lab Team Leader - Sheila Hernandez (432) 495-7240 Water Analysis Report by Baker Petro lite Company: UNOCAL ALASKA RESOURCES Sales ROT: Account Manager: TODD STONE (907) 283-4634 Region: ALASKA Area: KENAI, AK Lease/Platform: PRETTY CREEK Entity (or well #): 4 Sample #: Analysis 10 #: Formation: Sample Point: BELUGA 51-5 SANDS COMPRESSOR Summary 31104 235504 51886 Sampling Date: Analysis Date: Ana Iyst: mg/l Analysis of Sample 235504 @ 75 of meq/l Cations 5/26/05 6/7/05 STACEY SMITH Anions Chloride: Bicarbonate: Carbonate: Sulfate: Phosphate: Borate: Silicate: 4954.0 1220.0 0.0 3.0 139.73 19.99 o. 0.06 TDS (mg/I or g/m3): 9856.4 Density (g/cm3, tonne/m3): 1.008 Anion/Cation Ratio: 0.9999999 Carbon Dioxide: Oxygen: Comments: 760 PPM RESISTIVITY: 0.8 OHM-M @ 75°F Hydrogen Sulfide: pH at time of sampling: pH at time of analysis: pH used in Calculation: 0,5 PPM 7.17 Sodium: Magnesium: Calcium: Strontium: Barium: Iron: Potassium: Aluminum: Chromium: Copper: Lead: Manganese: Nickel: mg/l 2405.4 240.0 360.0 3.0 11.0 33.0 627.0 meq/l 104.63 19.74 17.96 0.07 0.16 1.19 16.03 7.17 Conditions Values Calculated at the Given Conditions - Amounts of Scale in Ib/1000 bbl Gauge Calcite Gypsum Anhydrite Celestite Barite CO2 Temp Press. CaC03 CaSO ¡2~ 0 CaS04 SrS04 BaSO 4 Press of psi Index Amount Index Amount Index Amount Index Amount Index Amount psi 80 0 0.87 107,94 -3.13 0.00 -3.20 0.00 -3.44 0.00 0.23 0.69 0.93 100 0 0,98 123.91 -3.14 0.00 -3.15 0.00 -3.42 0.00 0.08 0.35 1.23 120 0 1,10 140.57 -3,15 0,00 -3.07 0,00 -3.40 0.00 -0.04 0.00 1.56 140 0 1.23 157.57 -3.14 0,00 -2,97 0,00 -3.36 0.00 -0,14 0.00 1.93 Note 1: When assessing the severity of the scale problem, both the saturation index (Sl) and amount of scale must be considered, Note 2: Precipitation of each scale is considered separately. Total scale will be less than the sum of the amounts of the five scales. Note 3: The reported C02 pressure is actually the calculated C02 fugacity. It is usually nearly the same as the C02 partial pressure. ATTACHMENT 14 #3 [Fwd: RE: Pretty Creek Storage Application] ) ') Subject: [Fwd: RE: Pretty Creek Storage Application] From: Thomas Maunder <tom_maunder@admin.state.ak.us> Date: Fri, 27 May 2005 09:49:09 -0800 T 9:.JoOO I) Hartz <j ack _hartz@ad11lin.state.a~. us>, Steve. Davies ·<steve_davies@admin;state.ak.us> CC: JodylColbmbie <jody _ coloínbie@admin.state.akus> FYI. -------- Original Message -------- Subject: RE: Pretty Creek Storage Application Date: Fri, 27 May 2005 09:47:27 -0800 From: Smetanka, Jeff W <smetankaj@unocal.com> To: tom maunder@admin.state.ak.us C C : 's"li"1'I"'rvaÏ1"';""''''''F'ã''y'e'''''''W''''''''';¿'s''uI'''rI''i'w@''u'rï"õ' c a 1 . corn> , S h ann 0 n , Co lee n C. <cshannon@unocal.com>, Whitacre, Dave S <whitacred@unocal.com>, Lambe, Steven S <lambes@unocal.com>, Darkwah, Samuel A <darkwahs@unocal.com> Tom, Thanks for your call today. As discussed, please continue to hold off on noticing the Pretty Creek Storage application until we submit our revised application. We are in the process of reconciling the differences between the log methods of determining TDS and our water analysis from the zone. In addition, we have gathered another produced water sample and have sent this off for analysis. We may be another week or slightly longer before we have the information to present to you. Thanks, Jeff ------------------------------------------------------------------------ *From:* Thomas Maunder [mailto:tom maunder@admin.state.ak.us] *Sent:* Wednesday, May 18, 2005 4:30 PM *To:* Smetanka, Jeff W *Cc:* Hartz, John D -AOGCC¡ Steve Davies¡ Jody J Colombie *Subject:* Re: Pretty Creek Storage Application Thanks Jeff. We will hold "noticing" until we have received the corrected document. Tom Maunder, PE AOGCC ------------------------------------------------------------------------ *From:* Smetanka, Jeff W *Sent:* Wednesday, May 18, 2005 4:19 PM 1 of2 5/31/2005 9:58 AM Fwd: RE: Pretty Creek Storage Application] ) ) *To: * "'tom maunder@admin. sta.te. ak. us' *ec:* Sullivan, Faye W; Shannon, Coleen C.; Whitacre, Dave S; Lambe, Steven S; Darkwah, Samuel A *Subject:* Pretty Creek Storage Application Tom, As we discussed today, we realize now that we have several errors in our Pretty Creek Storage application. We are working at this time to correct those errors and provide the additional information that you requested. To ensure that everything is in order before this goes out to the public, we request that the AOGCC temporarily hold off on putting this out to public notice. We hope to resolve all these issues soon. I will contact you when the revised report is complete and we are ready to resume the process. Thank you, Jeff Smetanka 263-7622 20f2 5/31/2005 9:58 AM #2 , ~ ') Unocal Alaska \ Union Oil Company of cal~a 909 West 9th Avenue, P.O, Box 196247 Anchorage, Alaska 99519-6247 Telephone (907) 276-7600 Fax (907)263-7698 J!!N 6)..,; l., ,t,,, 2005 UNOCALe r.:'~~~~ ¡f,'f;","" ~.;~~ '~~.,:¡~ 1:,'1\"") .~;~"""G ~f~,,~, ~,:~\\ !'l(i~~; "'.D~· . ~",' . ,,:;'::~..I,,:,,:\ (:'~:: :'.,.·",:í' '1~~}~ ~ ,,'v ,'.' ,..,..". ... """~ij MAY 1 3 2005 ~ DIVISION OF OIL AND GAS Kevin A. Tabler, Manager Land/Government Affairs May 11, 2005 Mr. Tom Irwin, Commissioner Alaska Department of Natural Resources 550 W, 7th Avenue, Suite 800 Anchorage, AK 99501-3560 RE: Petty Creek Unit Gas Storage Lease Application Cook Inlet Area State of Alaska Dear Commissioner: Union Oil Company of California (Unocal), as operator of the Pretty Creek Unit (PCU), hereby applies for a Gas Storage Lease as subsequently defined herein in accordance with 11AAC 83.500 - 520, 11AAC 88.105 and AS 38.05.180 (u). As part of this application, we have included the prescribed filing fee of $50.00 pursuant to 11 AAC 05.010 (10) U). Also enclosed, and made a part of this application is a copy of our Injection Order Application to the Alaska Oil and Gas Conservation Commission (AOGCC) dated May 10, 2005, which contains a thorough technical discussion of the geologic and engineering merits of this proposal. The lands affected by this application lie entirely within the PCU and are depicted on the attached Exhibit A. Specifically, the gas storage reservoir area will cover 720 acres more or less and is more particularly described as follows: ADL 63048 T14N-R9W Sec. 33: S1/2NW1/4, 81/2 NE1/4, S1/2 (480Acs) ADL 58813 T13N-R9W Sec, 4: N1/2NW1/4, N1/2NE1/4, SE1/4NW1/4, SW1/4NE1/4 (240 acs) Pretty Creek Unit Gas Storage Lease Application May 11 2005 Page:2 ) ) .., \ In compliance with the provisions of 11AAC 83. 520, we have enclosed three copies of a proposed form of gas storage lease. Supporting data demonstrating the feasibility of the proposed storage project is contained in the enclosed Injection Order application. For notice purposes regarding this application, please use the following address: Union Oil Company of California PO Box 196247 Anchorage, Alaska 99519-6247 Attn: Land Manager Should you have any technical questions, please do not hesitate to contact Jeff Smetanka, Reservoir Engineer. For any other questions please contact the undersigned at (907) 263-7600. Sincerely, Union Oil Company of California evin A. Tabler Its Attorney-in-F act Enclosures cc: AOGCC UNO CALi) ,,'.;J¡~ Alaska Miles 0.5 I 0.25 0 0.5 , X Pad Locations · pcu #4 Markers Pretty Creek Unit r=-¡I I', '" ..,. .'-:-.~,_~,' L ADL389520 ADL390571 ADL390103 ADL390102 l,':,I~~':.:";'-::::-~';~i: ~::.~~~::i~-~:~::=-:-:~~~:'; :c::-:::'7:':::"~~~:~~~'\~:::~n.;;:a.E::,:.~.f,;;"~]~.~J,~:¿:':Jmñf~~=i.~=:-:'::11,'- ~; ~ ' I r.~..1..,,~,...;.' . I'...' ~ t 1,"1 "'1 1'1. ' "'I' I' ~"I \1 ADL063047 2.,9. -~::~~;;-2.! 28 27 .~¡¡ ¡~I bl~ 'i1,:11 PCU 224-28 ' . ~I~ :'1', /. ~I¡ " ...' ,,' .':}! .. '~¡~j 1--.' _-:_____....J,I 'ilj,1 ',I ' ,~' ',....' '--, . ,:¡..'¡ ]!~!~ ;', V/ ,1.1 'I'... ^ riP ~ . ~ --,l' ADL058810 ADL39~1104 1,.11 ÄB~06St;l48 ~IÎ.·~ I" u :¡,- '.1' I::! 1,', :'~I~ \',':!'.'. ~ìJ ','iII ~~~ ~I' ~ , m ll;·~ ,I f~~ '.r: ~' , "" ,"." i,J" ~ Illflì~ ""l 32 . ..... . . .'.. ij~ AD. L063049 ~.' ""':·"'''·íi;''''··'~1 '!: .IQ~~':'~ ,r.:::'..~iW-!F'" ;:¡,: .]1 ,.'.1.. ' . 'mi..,' ' ,I, I : ¡ 1 3,~.Q'::m:~-,jjJ.". . i' ~fÇ,~"~t·"..:\r'·,~':,: ,";j"'I·' ;",', TH 4N R9W'il~"I~i¡W~b;~~~~~~~~~~ -l ,~1:h':·'" "". '>.':"'!';" ," 1Í13N R9W fl"":""," ,. t i~,': , " , I " I I ~ I l I: "," "", ",',' il' 'I iL ~¡ " ' AD~032930 .', ' .jl 51-5 I'.. :,,",' ,J,:I¡H,:~ li"1' 'i ., " /, I'~-I '; I' ,¡:,I'I' ~1 li'.1;. c'1i"1,~ ~h~'~'¡!'III~~I~'e : ~ t ':'1',1" . ':, ';\' I :I~~,;\,'l ,1!1:;N~;~~ AgL058814 5 ~' ". - - ." - ,;'''' . ,.~..~ I '!'i ADL058813 4 ",i >,.,','"i·'~C,,/' ~, .:, ¡'i ·"i:':.'I"{:,i~f;'ì'2",("';·:\t~I" '1' t¡ .,..""l..,. '·.'I,.J"I "I j' J~ r;i~;¡I!\;; " 'II I... "...L._._ ~I" ~ I ' ": I ' I~ ','L1 h ",' 'I'~ ~:~.-~~~:-~~·~;'i;';;";'~F;;;';:~;':';~~F.~;;=~.;~:~;;::~~~';;~~~~~~~i~:3::~8,¡;:r;,~~+~~~~~:::::¡::.:~~,¿:;;:.;;~,~~:~-:,;;~j ) ) Exhibit A: Pretty Cr. Gas Storage Reservoir Area Þ', ~ _.P #1 ) \ Unocal Alaska Resourc. ) Unocal Corporation 909 West 9th Avenue, P.O. Box 196247 Anchorage, Alaska 99519-6247 Telephone (907) 276-7600 RECEIVED MAY 11 Z005 UNOCAL8 Alaska Oil & Gas Cons. Commission Anchor~ge May 10, 2005 Ms. Cathy Foerster Mr. Dan Seamount Mr. John Norman Alaska Oil and Gas Conservation Commission 333 W. 7th Avenue, Suite 100 Anchorage, AK 99501-3539 Re: APPLICATION FOR STORAGE ORDER FOR PRETTY CREEK GAS STORAGE FACILITY Dear Commissioners: Attached for your review are two copies of Application for Injection Order for Gas Storage for the Pretty Creek Gas Storage Facility. The application is submitted by Union Oil Company of California (dba Unocal), as Operator. Upon your approval of this application and pending approval of gas storage with the Alaska Department of Natural Resources Division of Oil and Gas, Unocal plans to commence injection of gas into the PCU #4 Well this summer. Please contact Jeff Smetanka at 263-7622 if you have any questions regarding this application. 2Â1~ Jeff Smetanka Consulting Reservoir Engineer OR\G\~JAL ) ) APPLICATION FOR INJECTION ORDER FOR GAS STORAGE PRETTY CREEK GAS STORAGE FACILITY TABLE OF CONTENTS Section/ReQulatory Citation Subject Paae A. 20 AAC 25.252(c)(1) Plat information 3 S. 20 AAC 25.252( c )(2) Operators/Surface Owners 3 C. 20 AAC 25.252(c)(3) Affidavit 4 D. 20 AAC 25.252( c)( 4) Description of Operation 5 E. 20 AAC 25.252( c)( 4) Storage Zones 5 F. 20 AAC 25.252( c)( 4) Geologic Information 5 G. 20.AAC 25.252( c)( 4) Production History 6 H. 20 AAC 25.252(c)(5) Well Logs 8 I. 20 AAC 25.252(c)(6) Mechanical Integrity 8 J. 20 AAC 25.252(c)(6) Casing Information 8 K. 20 AAC 25.252( c )(7) Injection Fluid 9 L. 20 AAC 25.252(c)(8) Injection Pressure 9 M. 20 AAC 25.252(c)(9) Fracture Information 9 N. 20 AAC 25.252(c)(1 0) Formation Fluid 10 O. 20 AAC 25.252(c)(11) Aquifer Exemption 10 P. 20 AAC 25.252(c)(12) Wells Within Area 10 1 Number 1 2 3 4 5 6 7 8 9 10 11 12 13 ) ') PRETTY CREEK FIELD APPLICATION FOR INJECTION ORDER FOR GAS STORAGE PRETTY CREEK GAS STORAGE FACILITY LIST OF ATTACHMENTS Description Regional Cook Inlet Location Map PCU #4 Location Map, 51-5 Sand PCU #4 Location Map, 45-0 Sand PCU #4 Well Log Section Showing 51-5 Sand PCU #4 Well Log Section Showing 45-0 Sand PCU #4 Production Chart - Gas and Water Rates Material Balance Plot: P/Z vs Cumulative Gas Current Wellbore Schematic for PCU #4 Leak-off Test at Surface Casing Depth (9 5/8") for PCU #4 Leak-off Test at 7" Casing Depth for PCU #4 Sample Gas Analysis from Pretty Creek Field Sample Gas Analysis from Steelhead Platform GGS PCU #4 Water Analysis 2 ) ) PRETTY CREEK FIELD PRETTY CREEK GAS STORAGE FACILITY APPLICATION FOR STORAGE INJECTION ORDER May 5, 2005 Introduction Unocal Oil Company of California (dba Unocal), as operator of the Pretty Creek Unit, requests a storage injection order for a gas storage project within the boundaries of the Pretty Creek Gas Field. Unocal specifically requests permission for storage injection operations into the Beluga 51-5 and Sterling 45-0 sands, which are present in the PCU #4 well. After obtaining all necessary approvals, PCU #4 would be converted to gas storage service. Additional wells would possibly be drilled or redrilled to these same sands in the future to increase deliverability from the storage facility. Section A - Plat Attachment 1 is a regional map showing the location of the Pretty Creek Field relative to other fields in the Cook Inlet area. Attachments 2 and 3 are plats showing the location of the two proposed gas storage reservoirs in PCU #4: Beluga 51-5 and Sterling 45-0, respectively, and the surrounding wells in the Pretty Creek Field. Section B - Operators/Suñace Owners The surface owners and operators within the area of this injection order and extending one-quarter mile beyond the boundary are: . Unocal . State of Alaska Department of Natural Resources (DNR) 3 ') ) . Section C - Affidavit Affidavit of Samuel Atta-Darkwah STATE OF ALASKA THIRD JUDICIAL DISTRICT I, Samuel Atta-Darkwah, declare and affirm as follows: 1. I am over 19 years of age. I am employed by Unocal as a Reservoir Engineer. have personal knowledge of the matters set forth in this affidavit. 2. On MAY \ 0 , 2005, the surface owners/operators listed in section B were provided a copy of this permit application. DATED at Anchorage, Alaska this (v\ A: '(. , 2005. t D'TH day of ~~ Samuel Atta-Darkwah Subscribed and affirmed before me at Anchorage, Alaska on ~ '0) ,2005. ~~ Notary Public in and for the State of Alaska My commission expires: 8, tCf .0(0 4 ) Section D - Description of Operation } Unocal proposes injecting gas into the watered-out Sterling 45-0 sand and the nearly depleted Beluga 51-5 sand for gas storage purposes. Unocal intends to initially use the Beluga 51-5 sand for storage and later expand storage operations into the Sterling 45-0 sand. Initially, the PCU #4 well will be used as the sole well for gas storage operations (both production and injection). Unocal may later decide to redrill PCU #2 or drill a new well for storage operations in these two reservoirs. The storage gas will be injected during periods of excess supply and produced back during periods of increased demand to help balance gas deliverability requirements. Section E - Storage Zones The Beluga 51-5 sand (primary target) and the Sterling 45-0 sand (secondary target) are the proposed zones of injection. The primary target comprises a stratigraphic interval, the top of which correlates to depths defined in the following Pretty Creek Field wells: Well PCU4 PCU2 PCU 224-28 51-5 Sand Top (MD) 5144' 3671' 3902' Similarly, the 45-0 sand is penetrated as follows: Well PCU4 PCU2 PCU 224-28 45-0 Sand Top (MD) 4503' 3270' 3451' Section F - Geologic Information 51-5 Sand (TVDSS) -3585' -3586' -3630' 45-0 Sand (TVDSS) -3185' -3185' -3195' All gas production from the Pretty Creek Field has come from the Sterling and Beluga Formations. The Sterling Formation is the shallowest, extending in PCU #4 to a depth of approximately 3645 TVD feet. It is comprised of interbedded sands, silt, mudstone, and coal. The Sterling Formation was most likely deposited in a higher-energy meandering to braided stream environment. Underlying the Sterling is the Beluga Formation. These sands were probably deposited in a lower energy stream system and are likely to be laterally discontinuous. As with the Sterling Formation, these low-energy Beluga sands are inter-layered with abundant mudstones and coals. The Beluga low-energy section is approximately 900 feet thick at Pretty Creek Field. 5 ) ) Although gas production has not been established in the Tyonek sands at Pretty Creek Field, historical DST testing in PCU #2 determined that marginal and non-commercial quantities were present in this formation. The Tyonek Formation is comprised of meander belt and braided stream sandstones interbedded with mudstones and thick coals and is 4300 feet thick at Pretty Creek Field. BeluQa 51-5 Sand The 51-5 sand is a Beluga channel sand that is currently on production and is being depleted by the PCU #4 well. The sand appears to grade to overbank silt and finally to silty mudstone in the PCU #2 and PCU 224-28 wells, respectively, suggesting that there should be a channel boundary between PCU #4 and PCU #2 as the channel disappears to the north. The attached log section for PCU #4 (Attachment 4) shows the 51-5 sand at depths from 5144 to 5173 feet measured depth (MD). The sand is overlain by 10 MD feet of interbedded siltstone, clay-rich siltstone and mudstone, creating an impermeable barrier above; there are no permeable gas sands immediately above this interval. The sand is underlain by 21 MD feet of shale and shaly coal. The shaly coal grades to solid coal (PC4Coal pick) with depth; this 10-foot coal acts to seal off the 51-5 sand from possible permeable sands below. The PC4Coal is laterally extensive and easily picked in other wells across the field. Sterling 45-0 Sand The 45-0 sand is a Sterling sand in PCU #4 that has been produced and depleted. The sand appears to pinch out to the north as it becomes thinner and increasingly silty and shaly towards the PCU #2 and PCU 224-28 wells. Consequently, the 45-0 sand is not considered to be a gas reservoir in either of these two wells. The attached log section for PCU #4 (Attachment 5) shows the 45-0 sand at depths from 4503 to 4518 feet measured depth (MD). The sand is encased by coal above (36 MD feet) and below (33 MD feet). This thick coal is commonly referred to as the BelugaCoal (despite it being Sterling in age). The BelugaCoal is laterally extensive and is also penetrated by fields to the north (Lewis River) and east (Ivan River) of PCU #4. The coal acts to seal off the 45-0 from any permeable sands above or below. Section G - Production History The PCU #4 Well was drilled and completed in November 2001. Three gravel packs were installed, with one each in the Beluga 51-5, the Sterling 45-0 and the Beluga 55-6. A single 3-1/2" tubing string was run. Sliding sleeves were installed across each interval to enable zones to be opened or closed as required. 6 ) Attachment 6 shows the production history of the PCU #4 well. The well was produced the first winter with all three sands open and commingled. Peak gas production from the well occurred on 2/18/02 at 7.82 MMCFD at 975 psig flowing tubing pressure (ftp). I n April 2002, diagnostic work was performed on each interval. It was determined at that time that the bottom interval (Beluga sand from 5,566' - 5,577' MD) was not contributing to flow. After the diagnostic work, the well was returned to production in both the Beluga 51-5 and the Sterling 45-0 sands. I n November 2003, compression was installed on the pad to provide for lower flowing tubing pressures and additional recovery of reserves. Upon startup of the compressor, it became apparent that the water rate had increased significantly. Water rates continued to increase up to 14 bwpd rate. In April 2004, the well was shut in for compressor repairs. Attempts to return the well to production were unsuccessful. The sleeves were then shifted to determine if reliable gas production could be achieved. It was determined that the Sterling 45-0 sand had watered up and would not flow. The Beluga 51-5 sand was able to flow gas when produced in isolation. The well was returned to production in May 2004 from the Beluga 51-5 sand only. Initial water rates were high - in the 14 bwpd range. These water rates slowly decreased, giving indication that the zone was producing back water that had cross-flowed into the reservoir from the Sterling interval. The water rate eventually decreased to a 1 bwpd rate. The well continues to produce 1.85 mmcfd and 1 bwpd at 285 psig flowing tubing pressure. Estimates for original gas in place for the Beluga 51-5 sand were determined by analyzing the material balance plot (Attachment 7) for the post April 2004 period when the zone produced 0.708 bcf in isolation from the Sterling interval. Note that the P/Z vs. cumulative gas produced plot for this time period is a straight line, indicating volumetric type depletion or a weak aquifer at most. By extrapolating this straight line back to the original reservoir pressure for the sand, we constructed a theoretical plot for the zone had it produced in isolation over the entire depletion period. Using this approach, it is estimated that the original gas in place for this zone is 2.07 bcf. For the Sterling 45-0 sand, single zone depletion data was not available. For this reservoir we calculated the zonal cumulative gas production (1.29 bcf) by difference using the total for the well and the 51-5 zone estimates. As of May 1, 2005, cumulative production from the PCU #4 well is 2.73 bcf of gas and 1 MBW. Although the 51-5 sand is not yet fully depleted, it is desired to convert the well to gas storage service at this time in order to avoid production related problems that often occur at the late stages of reservoir depletion. 7 ) Section H - Well Logs All open hole logs from wells in the Pretty Creek Unit were sent to the Commission once the logs were completed.. Attachments 4 and 5 show log sections for the proposed injection intervals in well PCU 4. Section I - Mechanicallntegritv The PCU #4 well will be tested for mechanical integrity using the standard 30 minute annulus test per 20 AAC 25.412. To confirm continued mechanical integrity, Unocal will monitor daily injection rates and pressure and notify the AOGCC the next working day if the rates and pressure indicate pressure communication or leakage in any casing, tubing or packer. The rate and pressure data will also be reported to the Commission on a monthly basis. Mechanical integrity will also be monitored by observing the Material Balance Plot of P/Z versus Cumulative Gas Produced or Injected during gas storage operations. Monitoring of pressures and volumes in a gas storage reservoir is a secondary check upon mechanical integrity. The data from the original depletion can be compared with subsequent injection and production cycles. Although some hysteresis has been known to occur even in volumetric reservoirs, any problems that result in a loss of mechanical integrity will likely be evident in this data. Section J - Casing Information The current wellbore schematic shown in Attachment 8 will remain the same after gas storage operation commences. The casing in PCU #4 was cemented in accordance with 20 AAC 25.252(b) and tested in accordance with 20 AAC 25.030(g) when completed. The first hole section (12 %") in PCU #4 was drilled and subsequently completed with a 9-5/8" casing to a depth of 2,398' MD. The 9-5/8" casing shoe was pressure tested with 1500 psi surface pressure. A leak off test (LOT) was performed at the shoe (Attachment 9), 2,398'MD/1,977'TVD and yielded a leak-off pressure of 1000 psi and a fracture gradient of 0.99 psi/ft. The casing was cemented with 237 bbl of cement (210 bbl of 13 ppg lead slurry and 27 bbls of 15.8 ppg tail slurry) with returns to surface. The next hole section (8-1/2") was drilled and completed with 7" casing to a depth of 6,941' MD/5,1 04' TVD (TD is at 6,954' MD/5, 114' TVD). A leak-off test was performed at the shoe (Attachment 10), 6,941'MD/5,1 04'TVD and yielded a leak-off pressure of 1465 psi and a fracture gradient of 0.82 psi/ft. It was subsequently completed with 2- 7/8" production tubing to 4,372' MD/3,196' TVD and three packers and gravel pack assemblies (as well as three Baker CMD Sliding Sleeves) at 4,521' MD, 5,173' MD and 8 ) ) 5,576' MD. The cement bond log for the entire hole section indicates good bonding throughout. Note that the 6" hole section was drilled from 6,954' - 9,580' MD to evaluate Tyonek potential, but no zones of interest were encountered. Cement retainers were set at 5,581' and 6,862' to plug off this lower section. Production data from the well is also supportive of a good cement bond. Section K - Injection Fluid The type of fluid for proposed injection is dry natural gas, which is predominantly methane. It is intended to use the Pretty Creek Storage Facility for the injection of excess gas owned by Unocal; however, it is likely that the physical molecules of gas may be sourced from the Beluga River Field or from other West Side properties operated by others. The source of the Unocal owned and operated gas would likely be from the Grayling Gas Sands on the Steelhead Platform in the McArthur River field Attachments 11 and 12 are representative gas analyses for gas produced both from the PCU #4 well and from the Steelhead Platform Grayling Gas Sands. The compositions of the samples are very similar, with a specific gravity of 0.57. The Beluga River gas also has a very similar composition. Since all expected sources of gas are predominantly methane and are very similar to the original gas in the reservoir, no fluid compatibility problems are expected. The estimated maximum amount of gas to be injected daily is 20 mmcfd. Section L - Injection Pressure Compression will be used for gas injection and production operations. The estimated average injection pressure will be 1550 psig. The maximum injection pressure will be 2500 psig. Wellhead injection pressures will be maintained such that a gradient of 0.65 psi/ft at the target midpoint of perforations depth of 3,686' TVD (51-5 sand) is not exceeded. This corresponds to wellhead pressures of approximately 2200 psig with the well shut in and 2500 psig at a 10 mmcfd injection rate. Section M - Fracture Information The proposed maximum injection pressures for the gas storage operation will not initiate fractures in the confining strata which might enable the injection or formation fluid to enter freshwater strata. The proposed maximum injection pressure for PCU #4 in the 9 ) Beluga 51-5 sand, as previously mentioned, will not exceed a gradient of 0.65 psi/ft at the sandface. As stated in Section I of this document, leak off tests conducted while drilling PCU #4 in November 2001 (Attachments 9 & 10), show the fracture gradient at 1,977' TVD and 5,104' TVD to be 0.99 psi/ft and 0.82 psi/ft, respectively. Original reservoir pressure in the Beluga 51-5 sand in PCU 4 is estimated at 1659 psi based on normal pressure gradient in offset wells on the West side. Section N - Formation Fluid Attachment 13 is a produced water sample from the well collected on 5/17/04. Section 0 - Aquifer Exemption The proposed gas injection will be at depths of approximately 4,507' - 4,514' MD (3,275' - 3,279' TVD) and 5,152' - 5,172' MD (3,678' - 3,692' TVD). As per 40 CFR 147.1 02(b) the aquifers in the Pretty Creek Field are exempted in accordance with 40 CFR 144.7(b) and 40 CFR 146.4. Section P - Wells Within Area As shown in Attachments 2 and 3, there are no wells that penetrate the Beluga 51-5 sand and Sterling 45-0 sands within a quarter mile of the proposed PCU #4 well. 10 ~ , "'.. fF ì I f 1- : : i : : I U~ffiB : I I I ' . I , , I , I ------ __, _________ , _ -------....-u--------.------_____t__________ ,____. :-----------1-----------1----------;-----______;______-----¡-----------¡- iI ¡- : I ! I I: ' , , , , : , I , , I , \, : : : : : : : : : l ~ ~r : /~ ' T14II' .L .L ~ I , , , , I I I : : : PRETlYCIjŒK : , : : : I: ' I , I I , I , , I , : : '~: : : ~ " - 1_______ ¿-J f--------u_:_____ Pretty Creek .------1---------- ---t---- --sïUûp------ __~------ tq ______~ : ': F· Id :, LAKt::: I ; Tl-; Gas, e! i ¡ ! ¡ -1 I ~" I "" 1'..---' i ' , , "" j , : : , I 'BE!lJG¡I RIB, , : : : :. AN Cd OPJAG E ' , , , : , I , , , L ____ ----l,-:-------_.....r___. L-r----------l-r------___l_r_________i_r_________..-___------".---- --.L,----------.,-------___.,__________~---------- ¡ RRE ~ ~ , I : : : : I : : : : : :s_ '~: ' , , , , , : : , , -Ä : , : I : : : I I I :: I I ' !'I2I'C, , , , , I : , , , : : : I : : : : : , : : : I I ' , , I IIOWA\V(j£ I , .: , , , : , : : I I -------, -_______ u-----'-----------~---------_~---________~--________4_-__________¡__ -r--------T----------r---------r:::.~t--- ~ 4œ~ i ! i ! i : : : f'ROD. r AClUII£s :: "I:: I / fUN I f NICOlAI CREEK I. KAlA , , , I I I,: : : :: :':"':: I I , , I mAl/lIE POIN" , : I I , , : --i-----------i-----------i________ --f---------- ----i-----------f-----------f--------___f___ ------1_______ ---7-----------1-----------:---. ' , " "A"", I , : ' , " "'\, I, '~ ' , " "Þ"}':'" I ' TlGlr, " "', I , , : : I , QlAHJI£: : . : ': :, -..... I I ~ ~œlH PaNT : ~\þ I : , , : : ! i 5PæR 1R1D'NG 8AY: : i ì. : : ---------L--------L_________L_________... ________~--- ---- ------ --- ----------- -- --1-----------1-----__ --- --I-Z-------I------- 1 ~ ¡ : : : : : : " ~',:[, ", I, I f,lunvrtAl/ NORTH ' I.,.: : : , , : : I, 'I (\ I I I, I : TIIN : s MlODl.£ GI!CtINO (V'\.J : ~ I : : : : I :: : SHOAl : (' \J : : BRCH HIlL : : : : I " , \) , , : , , , I , :: .."."'::, ---L ---------_L ----------1 ----------JT---------_J,.__________~--- --~I7;;jìli:î--...- ,__----Lr----------~r-------- ~¡------- ¡ r r : : : TÍ.IIIII(o IlAY . "" I I" PRqo. rACIUTIES : : SHOAl I : : J: : , : ' 111II "~'T ""::: 0 I : nt:i ::::'" !!!Ii'_." 'FORfiANO 'I,,::: :SCAlE :: : ~' I I , : I I ' "I --- ' ---------- ___________ -----------T-. --T-- --- ~ -T---- ~-----T---------r- SWfsoo RIB i r ¡ Attachment 1 ' , EAsr F-"RElNio , I.. I , -... ~.",''''... , . .- 10 -J 5 ~ IN NILES! / Cook Inlet Regional Map N ) ) PCU #4 Location Map, 51-5 Sand (Depth values in TVDSS) N 8~. 000 N 8i2.0~0 8i7 I iÍi0 N oS> GI G:I iSI ISJ rSJ 29 28 27 N -'ð61PCU .224-.28 N · · en en (Jl + (Jl -.J _ _-..:I · · oS> iSI GI ISJ oS> iSI Quarter mile; radius around 51-5 pønetration -358E"rSPCU 2 in PCU-4 well 3.2 \ 33 34 1,\ N N CI) CI) (Jl (Jl N _ _N · · I3õI -3565 - IS! GI ISJ oS> iSI :¢:Feu 4 5 4 .3 N N · CI) CI) tÞ ¡.þ --.] -.] ~ ~. 000 ~i2.0~0 ~i7 I ~0 tSI 5) I3õI IS! 1 :6C100 l'EE'f' 1 11" aopGTEET Attachment 2 ) ) PCU #4 Location Map, 45-0 Sand (Depth values in TVDSS) N 8~. 000 N (5) - c:;) oS:! 8i2.0~0 N 8i?ä0 N oSo -GI ISJ 29 28 27 fCU 224-28 N -8191 N · r:n en (f (J1 -.J _ + --...:I · (5) oSo ~ GI (5) oSo . , ¡ Quarter mile radius ¡around 45-0 pen~tration fCU 2 : in PCU-4 w~1I -318' \ S2 33 3'1 I\) N (I') en (f -3185- (J1 N _ _N . · 13::1 \~ IS'! ~ 1St (5) oSo PCl .4 ~ 5 4: 3 I\) N (I') en IÞO ..Þ -J -.J ~ ~. 000 ~i2.0~0 ~i?,~0 oS) oS.I 13::1 IS'! 1 :6000 FEET ~ 'Ï 20fD FEET Attachment 3 PC5Coo~1 PC4\.;V'" í I i I í Beluga 51-5T ' i I ,.............-.........,...-..1....-..""....._._..._.............,...-4<_... .=:>- , ..-- ,~~ ~ ¡ ~--~ :;:~ ;-- ~ C·R_CO~ ~ ,r "6~Yff~ss ~0g lock ! to - "" - ~ Q o ,"" "'1 . o ~ ~ -, .., , , o g~o .".0 . If) "" - . Q .. 2- '"VJ ¡Ii o o If) .,., ð o N ti"J - , ~ r t ... "--Ao..___~.~ (PC ~' '-~--;·_------:-"-"T "--~. ~....:.::---~--i-t¿:---c.Œ¡,-, ~~Jlnt~~A1.""PK:=::."'~."'7HIfi.,m<~4.',.. ..nß<11;;~I)~.S8nd,I~NU,.<nI. i:Tn, .':~..&, ., .- .. :.<..~frD,."J'I-m'flri'T:~l1:n:-nN:U1TtU1.TIrt~,'. .:INOIoI'IItNIIN';';IfliImm'i},JlII:r:! 7 . ':~~-=-" ' ~r--- . · ~G' ~¡~ ~ .... l .A i ,~ f- ~ . f ,~ Attachment 4 o o ,... tJ') I '~ ." ~"iir ~".€-s Jm.",- 0 '=.,_~ ,..--.. ,~ .....» .-, ~~,~~----- ? ? .E>~ TLC.$ ej~ ~ :L -- ')! ~' ,30 e."'~ .?fA P'$R A1R PCU-4 Well Log Showing 51-5 Sand --~--~--TF(O RH06 HIP,", Rd.. ., ....r, <")., I ~> , ~ > " , - .. ~ - '. M - _'''',,'' -=~, '''''',"'',."",-_.- '..-xl'" - ....{J~"'fe~::;-"t'r'1¡.æKi'!-· ... -W'-' --...., . "..-em.,", '"'~\I"'_, ~/J"dl"-I".."~~~";~-"H-~~n'A. ,,~,,: .. .... .... - -. -' ,. ..,----..~...-.-.-<O;::..".,---""'~..--..-..-:~J t ~ 'fv-v ,",'¿' u ___ ~~ ~! t ..., , . " I - , · 7 ... 0 I ~ ~ R r ~ 4L. ..: """"'- . . Attachment 5 ~ 9' ~___ ". .,.2 , ... ,,-~--~-- -- ( f,(.~ ....~:> -t- ~ ~' --~'~ , 0" ~ :_-~ , aa~M .....00 ~~I..,.~ )~ '- - ~ -" ~ . . î AUt ~ P<: 1 ('nn I t- 00 !- ~ ¡ 0. ~- .. f- .!. .- . ~~ ? ~- ,~ rß~.o;, ~I -"''Ar..n,_ rI\.J . '! ~i!l4'~ -~ ~ (·~¿olt ~__ _ f!_~-'-~__ _~___~~~~ -f""~~ - PCU-4 Well Log Showing 45-0 Sand PCU #4 Production Chart - Gas and Water Rates 12000 20 --- Gas Rate -+-- Water Rate 10000 - - 15 8000 "C Co "C ~ .... i (,) E en a> CD - 6000 1 0 t:.. C'G a:: CD - en C'G C'G a:: C) ... CD - 4000 ~ - 2000 o Jan-01 o Jan-02 Jan-03 Jan-04 Jan-05 ATTACHMENT 6 2000 1500 .! In Q. 1000 tf a.. 500 o o PCU #4 Material Balance Plot: P/Z vs Cumulative Gas Blue diamonds: 51-5 and 45-0 commingled Red boxes: Beluga 51-5 in isolation "'" 5/1/05 Cumulative Production . I I Estimated Ultimate Recovery 1 I 2 I , : I 3 4 Cum Gas, bcf -' 5 ATTACHMENT 7 UNOCALe Tight spot in tubing at ~1150' WLM (4/17/03) 1 i ~ ~ .,~ ~ ¡ I u ,~ A -/ . , 2 Å 3 I 4 ~.- II 5 ~III E:! .- IV ~'-V 6 7 ;:. ;- :;! :'. ª :...~.- VI 8 9 L ~ L' ) SIZE WT 13-318" 9-518" 47 7" 29 Tubing 2- 7 18" 6.4 2-3/8" 4.6 NO. Depth I 4521 II 4560 III 5173 IV 5212 V 5319 VI 5576 5581 I 2 4,372' 3 4,501' 4 4,526' 5 5,147' 6 5,181 ' 7 5,554' 8 5,584' 9 6,862' A 2,517' Date 11/14/2001 11/17/2001 11/24/2001 Zone Sterlin~ Belu~a Belu~a )retty Creek Well No.4 Actual 05/05/04 CASING AND TUBING DETAIL GRADE CONN to L-80 Butt L-80 Butt L-80 Butt SC L-80 Butt SC JEWELRY DETAIL 00 Item Production Tubing Inner String Jewelry Baker CMD sliding sleeve Baker "X" nipple Baker CMD sliding sleeve Baker "X" nipple Baker "X" nipple Baker CMD sliding sleeve Bull plug - end of tubing to 2.3 ]3 2.313 2.313 2.3 ]3 2.313 2.313 3.170 3.24 3.1.7 3.24 3.1] 7 3.17 TOP Surface Surface Surtàce BTM. 75' 2,398' 6,941 ' 4,372' 2,517' Packers, Screens, Misc. Dua] Tubing Hanger, 2-7/8" x 2-3/8", ]]" 5 M SC-l Grave] Pack Packer Baker Weld Wire Wrapped Screen SC-l Grave] Pack Packer Baker Weld Wire Wrapped Screen SC-l Gravel Pack Packer Baker Weld Wire Wrapped Screen K-l Retainer K-] Retainer with] 2 bbls cement below and 5 bb]s above. Heater String 2-3/8", L-80, Butt SC PERFORATION HISTORY Interval Accurn. Top Btm Amt spf Comments 4,507' 4,514' 7' 12 5,152' 5,172' 20' 12 5,566' 5,577' 1].' 12 SLIDING SLEEVE HISTORY SS Depth 5/4/2002 9/21/2002 4/30/03 4/9104 4521 closed open open open 5] 73 open open open? closed 5576 closed closed open closed TO = 9,502'M0I7,600'TVO Max Hole Angle = 51 deg ATTACHMENT 8 Pretty Creek Field PC #4 1200 Pressure vs Volume 9.625" LOT UNOCALi> 1000 DATE: 10/16/2001 Strokes I Volume Pump Time .~ FOREMAN D Fowler Pumped Pressure FIELD: Pretty Creek (BBLS) (psi) (min) 800 PLATFORM: 0 1.00 200 4,0 WELL: PC #4 1.25 250 5,0 1.50 300 6,0 600 SIZE: 9.625 IN 1.75 350 7,0 WEIGHT: 47.0 LBS 2.00 400 8,0 GRADE: L-80 2.25 450 9,0 400 ~. BURST: 6,870 PSI 2.50 500 10,0 '~ MAX. PRESS: 5,496 PSI 2.75 550 11.0 TEST PRESS: 1,500 PSI 3.00 600 12,0 200 3.25 650 13,0 CSG DEPTH (MD): 2,398 FT 3.50 700 14.0 CSG DEPTH (TVD): 1,977 FT 3.75 740 15,0 i TD (MEASURED): FT 4.00 780 1.00 2,00 3.00 4,00 5,00 6,00 7,00 2,398 16,0 Volume (BBLs) TD (TVD): 1,977 FT 4.25 810 17,0 FLUID TYPE: POLYMER MUD 4.50 850 18,0 MW: 9.30 PPG 4.75 895 19,0 Pressure vs Time INCREMENTS: 0.25 BBLS 5,00 940 20,0 PUMP IN RATE: 0,25 BPM 5,25 950 21,0 1200 LEAKOFF(GRAPH): 1,000 PSI 5,50 970 22,0 LOT OR FIT?: LOT 5,75 990 23,0 FRAC GRAD: 0.989 PSIIFT 6,00 1000 24.0 1000 . . \ EMW: 18.40 PPG 6,25 1000 25,0 ~ 6,50 1000 26,0 IKB - MSL FT 830 27,0 KB - MUD LINE FT 730 28,0 800 ICOR FG.: 0,99 PSI/FT COR EMW: 19,03 PPG 600 '- 400 200 5,0 10,0 15,0 Time (Minutes) 20,0 25,0 30,0 Note: .101 BBLS/STRK Copy of PC #4 9.625 LOT ATTACHMENT 9 Pretty Creek Field PC #4 2500 Pressure vs Volume ~---- 7"LOT UNOCALe 2000 DATE: 10/28/2001 Strokes I Volume Pump Time ---------- FOREMAN D Fowler Pumped Pressure FIELD: Pretty Creek (BBLS) (psi) (min) PLATFORM: 0 0 1500 WELL: PC #4 0.25 13 1,0 0,50 28 2,0 SIZE: 7" IN 0.75 61 3,0 WEIGHT: 29# LBS 1.00 176 4,0 1000 GRADE: L-80 1.25 338 5,0 BURST: 8,160 PSI 1.50 502 6,0 '-!-""' MAX. PRESS: 6,528 PSI 1.75 679 7.0 500 TEST PRESS: 3,000 PSI 2.00 844 8,0 2.25 1017 9,0 CSG DEPTH (MD): 6,941 FT 2.50 1178 10,0 CSG DEPTH (TVD): 5,104 FT 2.75 1329 11,0 0" 0,50 1,00 1,50 2,00 2,50 3,00 3,50 4,00 4,50 TD (MEASURED): 6,954 FT 3,00 1465 12,0 Volume (BBLs) TD (TVD): 5,104 FT 3.25 1584 13,0 FLUID TYPE: POLYMER MUD 3.50 1705 14.0 MW: 10.20 PPG 3.75 1810 15,0 Pressure vs Time INCREMENTS: 0.25 BBLS 4.00 1895 16,0 PUMP IN RATE: 0.25 BPM 4.25 1950 17.0 2500 LEAKOFF(GRAPH): 1,465 PSI 1835 18.0 LOT OR FIT?: LOT 1775 19,0 FRAC GRAD: 0.817 PSIIFT 1736 20.0 EMW: 15,71 PPG 1650 21.0 2000 IKB - MSL 87.70 FT KB - MUD LINE FT 1500 ICOR FG.: 0,82 PSI/FT ! COR EMW: 15.86 PPG " " " e Q. 1000 500 Copy of PC #4 7,0 LOT oz 5,0 10,0 15,0 Time (Minutes) 20,0 25,0 30,0 ATTACHMENT 10 ) Unocal Gas Analysis Report Location: Pretty Creek Unit #4 Facility 10: WSPC Analysis Date: 3/16/05 Btu/Cf: 1003.577 Gravity: 0.5630756 CO2 0.52107 N2 0.63934 Methane 98.77972 Ethane 0.04426 Propane Ibutane Nbutane NeoPentane I pentane Npentane C6+ 0.01561 100.00000 ATTACHMENT 11 ) Unocal Gas Analysis Report Location: Facility 10: Analysis Date: Btu/Cf: Gravity: C02 N2 Methane Ethane Propane I butane Nbutane NeoPentane I pentane Npentane C6+ Steelhead GGS (6105 meter) TBPF 6105 12/6/04 1003.235 0.568105 0.30862 1.45155 97.87396 0.16970 0.06731 0.01331 0.03390 0.08165 100.00000 ') ATTACHMENT 12 ) '~ } West Coast Region 5125 Boylan Street Bakersfield, CA 83308 (661) 325-4138 Lab Team Leader - Sheila Hernandez (915) 495-7240 Water Analysis Report by Baker Petrolite Company: UNOCAL ALASKA RESOURCES Region: ALASKA Area: KENAI, AK Lease/Platform: PRETTY CREEK Entity (or well #): Sales ROT: 31100 Account Manager: MIKE PING (907) 252-4082 Sample #: Analysis 10 #: Formation: Sample Point: UNKNOWN WASTE WATER 316644 43439 Anions Analysis of Sample 316644 @ 75 of mg/l meq/l Cations Summary Sampling Date: Analysis Date: Analyst: 5/17/04 5/27/04 JAMES AHRLETT Chloride: Bicarbonate: Carbonate: Sulfate: Phosphate: Borate: Silicate: 12222.0 1518.0 0.0 9.0 344.74 24.88 O. 0.19 TDS (mgll or g/m3): Density (g/cm3, tonne/m3): Anion/Cation Ratio: 22459.1 1.004 1 Carbon Dioxide: Oxygen: Comments: Hydrogen Sulfide: pH at time of sampling: pH at time of analysis: pH used in Calculation: 6.37 6.37 Sodium: Magnesium: Calcium: Strontium: Barium: Iron: Potassium: Aluminum: Chromium: Copper: Lead: Manganese: Nickel: mg/l 7787.2 52.0 90.0 0.9 6.0 228.0 546.0 meq/l 338.73 4.28 4.49 0.02 0.09 8.24 13.96 Conditions Values Calculated at the Given Conditions - Amounts of Scale in Ib/1000 bbl Gauge Calcite Gypsum Anhydrite Celestite Barite CO2 Temp Press. CaC03 CaSO ¡2J2 0 CaSO 4 SrS04 BaSO 4 Press of psi Index Amount Index Amount Index Amount Index Amount Index Amount psi 80 0 -0.58 0.00 -3.47 0.00 -3.53 0.00 -3.67 0.00 0.26 1.37 6.79 100 0 -0.46 0.00 -3.49 0.00 -3.49 0.00 -3.67 0.00 0.10 0.69 8.79 120 0 -0.33 0.00 -3.51 0.00 -3.43 0.00 -3.65 0.00 -0.04 0.00 10.93 140 0 -0,19 0.00 -3,52 0.00 -3.35 0.00 -3,63 0.00 -0.15 0.00 13.13 Note 1: When assessing the severity of the scale problem, both the saturation index (SI) and amount of scale must be considered. Note 2: Precipitation of each scale is considered separately. Total scale will be less than the sum of the amounts of the five scales, Note 3: The reported C02 pressure is actually the calculated C02 fugacity. It is usually nearly the same as the C02 partial pressure. ATTACHMENT 13