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209-036
. . Image Project Well History File Cover Page XHVZE This page identifies those items that were not scanned during the initial production scanning phase. They are available in the original file, may be scanned during a special rescan activity or are viewable by direct inspection of the file. .0 y - 0 3 , Well History File Identifier Organizing (done) ❑ Two -sided I 11111111 II III ❑ Rescan Needed II I 1 1111 111 11 RE AN DIGITAL DATA OVERSIZED (Scannable) Color Items: ❑ Diskettes, No. ❑ Maps: ❑ Greyscale Items: ❑ Other, No/Type: ❑ Other Items Scannable by a Large Scanner ❑ Poor Quality Originals: OVERSIZED (Non - Scannable) ❑ Other: ❑ Logs of various kinds: NOTES: ❑ Other:: BY: Date: /f /s/ Project Proofing 11 1 1111111 11111 BY: OCIP Date: 0 / 11 /s/ i4 Scanning Preparation J x 30 = + q = TOTAL PAGES -3 (Count does not include cover sheet) 1 Maria Date: ) �iy /4 1 / /s/ BY: C am°° l V / Production Scanning III 1E11 III II IU Stage 1 Page Count from Scanned File: #0 (Count does include cov heet) Page Count Matches Number in Scannin Preparation: YES NO BY: Maria Date: 10 14/11 lsl to 111 Stage 1 If NO in stage 1, page(s) discrepancies were found: YES NO BY: Maria Date: /s/ Scanning is complete at this point unless rescanning is required. I 1111 ReScanned 13111 II III I BY: Maria Date: /s/ Comments about this file: Quality Checked I 10/6/2005 Well History File Cover Page.doc DATA SUBMITTAL COMPLIANCE REPORT 10/3/2011 Permit to Drill 2090360 Well Name /No. WAINWRIGHT 11XX Operator U S DEPT OF INTERIOR API No. 50- 301 - 20013 -00 -00 MD TVD Completion Date 7/14/2009 Completion Status Current S tus EXPI UIC N REQUIRED INFORMATION - Mud Log Yes Samples No Directional Survey No DATA INFORMATION Types Electric or Other Logs Run: (data taken from Logs Portion of Master Well Data Maint Well Log Information: • Log/ Electr Data Digital Dataset Log Log Run Interval OH / Type Med /Frmt Number Name Scale Media No Start Stop CH Received Comments Well Cores /Samples Information: Sample Interval Set Name Start Stop Sent Received Number Comments ADDITIONAL INFORMATION Well Cored? Y / N Daily History Received? Y / N Chips Received? Y / N Formation Tops Y / N Analysis Y / N Received? �t Comments: '•� 1`� b l G_i p Lr wv; Compliance Reviewed By Date: 3 t t X1\1 !, ‘11/ • McMains, Stephen E (DOA) From: Arthur C Clark [aclark @usgs.gov] Sent: Wednesday, October 13, 2010 6:58 AM 9 To: u Stephen E (DOA) c / dd) ( 0,3/ Stat Subject: Status of f well ell Wainwright 7 Steve, Wells Wainwright 7 and Wainwright 11 were both permitted but were not, and never will be, drilled. Art Clark Supervisory Geologist U.S. Geological Survey Box 25046 MS 939 Denver Federal Center Denver, CO 80225 phone: 303 - 236 -5793 aclark(cr�usgs.gov I r — t r ^ 8 s i d r gg d w Pip 7r7, 4 = LI 4 f t \\\,, r n f M F ,` r F 9y q k � �^ SARAH PALM, GOVERNOR L=n r ALASKA OIL AND GAS / 333 W. 7th AVENUE, SUITE 100 CONSERVATION COMMISSION / ANCHORAGE, ALASKA 99501 -3539 PHONE (907) 279 -1433 FAX (907) 276 -7542 Arthur Clark Supervising Geologist U.S. Geological Survey - DOI P.O. Box 25046 MS 406 Denver Federal Center Denver, CO 80225 Re: Exploratory Well Wainright No.11 U.S. Geological Survey - DOE Permit No: 209 -036 (Corrected) Surface Location: 4310' FNL, 2280' FEL, T15N, R32W, SEC. 24 Bottom Location: 4310' FNL, 2280' FEL, T15N, R32W, SEC. 24 Dear Mr. Clark: Please disregard the original transmittal letter that was sent to you on June 8, 2009 it contained a typographical error, note the changes in the first paragraph. It should have indicated that the transmitted letter approved an application was for an exploratory well not a development well. Sincerely, Daniel T. Seamount, Jr. Chair DATED this f1 day of July, 2009 cc: Department of Fish & Game, Habitat Section w/o encl. Department of Environmental Conservation w/o encl. 1111 1 glig Alta--,,,A\ SARAH PALIN, GOVERNOR ALASKA OIL AND GAS 333 W. 7th AVENUE, SUITE 100 CONSERVATION COMMJSSIOIQ ANCHORAGE, ALASKA 99501 -3539 PHONE (907) 279 -1433 FAX (907) 276 -7542 Arthur Clark Supervising Geologist U.S. Geological Survey - DOI P.O. Box 25046 MS 406 Denver Federal Center Denver, CO 80225 Re: Exploratory Well Wainright No.11 U.S. Geological Survey - DOE Permit No: 209 -036 Surface Location: 4310' FNL, 2280' FEL, T15N, R32W, SEC. 24 Bottom Location: 4310' FNL, 2280' FEL, T15N, R32W, SEC. 24 Dear Mr. Clark: Enclosed is the approved application for permit to drill the above referenced development well. This permit to drill does not exempt you from obtaining additional permits or an approval required by law from other governmental agencies and does not authorize conducting drilling operations until all other required permits and approvals have been issued. In addition, the Commission reserves the right to withdraw the permit in the event it was erroneously issued. A weekly status report is required from the time the well is spudded until it is suspended or plugged and abandoned. The report should be a generalized synopsis of the week's activities and is exclusively for the Commission's internal use. Conservation Order No. 618 (attached) grants a spacing exception to allow the drilling of this well as well as equipment exemptions requested by the U.S. Geological Survey - DOI associated with the drilling of this well. Please note that production testing and hydraulic fracturing must be approved by separate Commission action. Except as provided in this permit, operations must be conducted in accordance with AS 31.05; Title 20, Chapter 25 of the Alaska Administrative Code (e.g., 20 AAC 25.055); and any applicable orders or permits of the Commissioin. Failure to so comply may result in the revocation or suspension of the permit, other enforcement actions, and penalties. • 0 Permit No: 209 -036 June 5, 2009 Page 2 of 2 When providing notice for a representative of the Commission to witness any required test, contact the Commission's petroleum field inspector at (907) 659- 3607 (pager). cerely, tp" Dan T. Seamount, Jr. Chair DAFED this day of June, 2009 cc: Department of Fish & Game, Habitat Section w/o encl. Department of Environmental Conservation w/o encl. DR - °- -4 -09 STATE OF ALASKA ALASKA OIL AND GAS CONSERVATION COMMISSION PERMIT TO DRILL 20 AAC 25.005 1 a. Type of Work: 1 b. Current Well Class: Exploratory E • Development Oil ❑ 1 c. Specify if well is proposed for: Drill E . Redrill I] Stratigraphic Test ❑ Service 0 Development Gas ❑ Coalbed Methane ® . Gas Hydrates [] Re -entry ❑ Multiple Zone ❑ Single Zone ❑ Shale Gas ❑ 2. Operator Name: US Geological Survey DOI • 5. Bond: Blanket ® Single Well ❑ 11. Well Name and Number: g Y Bond No. DOI , SELF-INSURED • Wainwright 11 3. Address: p0 Box 25046, MS 406, Denver Federal Center 6. Proposed Depth: 12. Field /Pool(s): Denver, C080225 MD: 3000' ND; 3000', 4a. Location of Well (Governmental Section): 7Property Desi nation: Ei L., ug + ?rr r L? Surfac MTRS: Umiat T15N R32W, Sec. 24 North , Top of Productive Horizon: FNL:4310', FEL:2280' 8. Land Use Permit: 13. Approximate Spud Date: 70 °38'6.89 "N 160 °1'48.34'W • N/A June 1, 2009 Total Depth: 9. Acres in Property: 14. Distance to Nearest Vertical Well: 3000' 6 a -11" Property: 4b. Location of Well (State Base Plane Coordinates):6,6 0571 10. KB Bevation 15. Distance to Nearest Well Surface: x- 6 Zone - ... $ (Height above GL): 5' feet Within Pod: - 4;A • -� E 16. Deviated well /N 3- /4.c' K lckoff depth: feet 17. Maximum Anticipated Pressures in psig (see 20 AAC 25.035) =4 Maximum Hole Angle: degrees Downhde: 1293 ' Surface: 0 ` 3, , , 18. Casing Program: Specifications Top - Setting Depth - Bottom Cement Quantity, c.f. or sacks Hde Casing Weight Grade Coupling Length MD TVD MD TVD (including stage data) 9 7/8 6 5/8 18.97 20 0 80 • 30 cu. ft. ppt 19. PRESENT WELL CONDITION SUMMARY (To be completed for Redrill and Re -Entry Operations) Total Depth MD (ft): Total Depth TVD (ft): Plugs (measured): Effect. Depth MD (ft): Effect. Depth TVD (ft): Junk (measured): Casing Length Size Cement Volume MD TVD Conductor/Structural Surface Intermediate Production Liner Perforation Depth MD (ft): Perforation Depth TVD (ft): 20. Attachments: Filing Fee ❑ BOP Sketch ❑ Drilling Program ® Time v. Depth Plot ® Shallow Hazard Analysis E Property Plat ® Diverter Sketch © Seabed Report ❑ Drilling Fluid Program ® 20 AAC 25.050 requirements El 21 Verbal Approval: Commission Representative: Date 22. I hereby certify that the foregoing is true and correct. Contact .1 Printed Name ` A TH CLARK Title SUPV'. GEOLOGIST / Signature 1g .../ Phone 303 - 236 - 5793 Date C73 f Commission Use Only Permit to Drill _ / API Number Permit Approval ( i9a See cover letter for other Number: 2.,C."7--01:7X:!. ( 50- .0 f PP \ ' (,}( '-L p ate: requirements. Conditions of approval : If box is checked, well may not be used to explore for, test, or produce coalbed meth ne, s hydrates, or gas contained in shales: ❑ Other: Samples req'd: Yes +[l No ❑ Mud log req'd: Yes' No❑ H measures: Yes❑ No 11911 Directional svy req'd: Yes❑ No[+-- Z-,e_ /i d'r6.Y7• - 7 Strrie i £. APPROVED BY THE COMMISSION (fJ CCGJ ��// DATE: / , COMMISSIONER Form 10-401 Revised 12/2005 Submit in Duplicate 6' x/7 Permit to Drill, Form 10 -401 � � tJ RECEIVED MAR 1 6 2009 AOGCC Permit to Drill. Form 10 -401. Wainwright #11 ORIGINAL Alaska Oil & Gas Cons. Commission March 04, 2009, Page 5 of 25 Anchorage KECEIVED • STATE OF ALASKA • MAR 0 q ZDD9 ALASKA OIL AND GAS CONSERVATION COMMISSION PERMIT TO DRILL Alaska Oil &G as Cons. Commission C 25,005 1 a pe o ork: 1 b. Currant Wall aaea: ... Exploratory etiiielooment011 ❑ le. Spedly w e proposed iiot ' age Drill ® Redd" ❑ Slydlgrephlc Tat p SirvICO ❑ Development Oss ❑ Ceelbed Methane ® au Hydrates 0 as.in"y ❑ _ _ Multiple zone ❑ Slagle one 0 _ Shale Gas ❑ 1. Upsrat?�r NOT* 5. bond; Blanket n e ■ it Weil Name and Numbs VS Geological Survey -DOI BendNo, DOI, S F -INSURED wainwright 11 3, Ma seer Box 2504"'1, MS 400, Denver Federal Center S. Worland 3 0 00 0 0 0 i 1;:, FleldlPooE(U: Danvar, CO 00225 MD. ' TVD: ' a, Location of Wall (governmental er): 7. ProcariD p na on: Sufism Umiat T15N R32W, Sec, 24 Nort Slope Born Top o f Froducdvs Horizon; FNt.:4!10', f=EL :2 e. tad UU F = r - 1 a Appresemate spun kalw 70 1S0 N/A June 1, 200 e #, Wet In Property 1d Dlscante co Nearest Thiel Depth: ' prey, Vertical Well; 3000 4b. LQc an o e I tola Base Plan Coordirtekle): 0. 1C EIvaliOn 15. Dlelanoe to Neeresl Well m x .393479.238y- 60a5777.762 tons. 6 (He►Oht above r ); 5' feet woln POal: 3400' ^�� 16 Deviated wails: ' i ' R dep111: feet t . . ; -Toted MauroMauroI n raiz (see 20 AAC 25.096) Metdrnum Hole Angie: degree" DOwnrt. 1293 SUM 0 - 1 B. Leering Program: $paeMeedona _ op - -ze "' rig Depth - Bohan cement Quantity, cl or sacra NOB Con- Wel -tit Grsda Ccu 11 • • Lan.Ih r D TVD MD -ND p)teludIr g Slap dais) 9 QL 1LJ� �= --lr0 "WA f PP 111 MEM WIN= _ IIIIIII r 19. PRESENT WELL CON ' 1 • ' To Ds comptoteq Tor Radr+u and Re -Entry Operation') o sp - - -- Toted Dslith TVD (R): (measured): - _ . )=Keel Dept MD (t): Effoot, Depth TVD (ft): Junk (meevured): I' L no Length � SIN Volume MD TVO _ Om DonductoNS>turturxl ,Aiffaimitmilli Burfece ElPA INIIIMISMINIM n,, edlale Ilr Pradut"er' ___ -- `.:�" unit ��l\IIM'I - Perferatton Depth MD (11): r Perroraterl 20 rkments: FMK rip - - a lill t34P $kateh Ill Drilling Progrtan n ® limey. WO PIOt ® 911MIO v Haar 0110" Props Plat °Netter SUMO t l' Seabed MOON V DrUUng Fluid Program IN 20 MC 25,050 rsgedt.minte EL 21. Verbal Approved: Cam ' aelon Reoreientelive: Cats — 22, I dire / Potty that in foregoing la cue and correct. °ordeal Printed Name ' ' `: CLARK The SCTPV' . GEOLOGIST Signature O RIMS 303 - 236 -5793 Dale I:73 Cemmt..lon Una Onty Permit t0 DrIli - 'urrt • Permit Appr. . ' 849 Weer letter far otter Number: 26? _ v 6 5o• S Q f.— , I.3 Data _ rioUlremsrite, Condon. of coo roved : if box I" Checked. wstl may eel be used to *ore tor, leel, or produce method methane, gee hydrate', or pas =Wed In "nose: ❑ Other: Semld es nett V Na 0 Mud leg reghd: Yes v❑ N meaeuree: YesU No r2 Dlrsotional SW reC'd: YN❑ NO[+]*; .lCJ1,) Q>Z'�i YI/eN %it/ - S' /8,o APPRQ'VEO BY THE COMMISSION DATE' , COMMISSIONER � FOrrn 10.401 Ravlaad 12/2005 —, $uDmlt In Duplicate Office Project 19 March 2009 INPUT OUTPUT Geographic, NAD83 State Plane, NAD27 5007 - Alaska 7, U.S. Feet Accuracies of conversions from NAD 83 to NAD 27 are typically 12 to 18 cm. Wainwright #11 1/1 Latitude: 70 38 06.89 Northing/Y: 6086074.147 Longitude: 160 01 48.34 Easting/X: 939627.832 Convergence: 1 51 42.36589 Scale Factor 0.999965226 Datum Shift (m.): Delta Lat. = 57.508, Delta Lon = - 126.341 (C Remark: Corpscon v6.0.1, U.S. Army Corps of Engineers SURVEYED TOWNSHIP 15 NORTH,RANGE 32 WEST OF THE UMIAT MERIDIAN, ALASKA STATUS OF PUBLIC DOMAIN LAND AND MINERAL TITLES / raw Pun at gee » MTP aa.a..,T,t .l ...a 01 110,71 / SUPPL Sec 24. 25 ►roau.tla. 11.71 - mew . it / ` PERMITTED WELLS / ' `� n :. �.,. �1 sl 11 1< /o u001100Se T16tCTS / - .1.11 ...-..:74-4,-.-,, .. q•1T 44 M1. . / ognm7t rare 101.1111.11111111111 / /1J SC. Only / U r I III =BIM 4,‘ / El: . / / 11b1.v fIrMN. A e Irr 2.7.1::-...... / - we N1S. Tr 11 7 \ �. . OIMNS LTi1FfTPA'f MEMiIt A. es. :.,w 1 ', / !, �t [k►.1MQ. tM11Pt.M tIMV-JIMGW04— �4 / itwall0lrtt�t +\> / 1LLIMMILIORN CMill .� . � i ` . T..u7tal , •1l 1tgCL 00Ctl tFA'1'5 / i 7"' : , .q4J at tte at cat a .tort* ttotte art % rt Pa-1.w we a A. At 11! / 4 +I�• 4t• • I ... p. ,a 1 ' O - - -- •t ' _ _. l - #1 - 1,: - Well Ofset I ill / , Well #lo Offset s / — / / 1,1r.nnr:.1 . _. -. • >,•' -�'• j _,tort. PROPOSED WELLS #10 and #11. RECEIVED SURFACE ESTATE OWNER: MAR 1 8 2009 OLGOONIK CORP. Alaska Oil & Gas Cons. Commission SUBSURFACE ESTATE OWNER: Anchorage FEDERAL BLM — ADI r2. T l4 ti SCME _ , 11,}�,.>r y 9 _.. _. }0 Inn'. i. ll� + t 10 Owns* 1W.. p - M . _ y�p�1..� w ..11.+. a::: ":,,,51:::: � F'.• A a �r ..urM w rwi - ..s....R�+41.. • • Application for Permit to Drill. State of Alaska, Alaska Oil & Gas Conservation Commission Permit to Drill. Application Summary. Well Name and Number: Wainwright #11, (Exploration, Offset Well) Well Location Area: North Slope Borough, Airport at Wainwright. Well Location Legal: MTRS: Umiat T15N R32W, Sec. 24. FNL:4310' FEL:2280' NAD83 Lat.: 70 °38'6.89 "N Long.: 160 °1'48.34 "W State Base Plane Coordinates. Zone 6 x- 1393479.238 y- 6085777.762 Purpose of Well: Coal Bed Methane, Exploration offset well. Waivers Requested: Bonding requirements of 20 MC 25.025, • Blowout prevention equipment requirements of 20 AAC 25.035. • Well bore survey requirements of 20 MC 25.050(a)(2). • Well site seismic survey requirements of 20 AAC 25.061(a). • Gas detection requirements of 20 MC 25.066. Well Spacing Exemption Requested: • Requested exception for the well spacing requirements of 20 AAC 25.055(a) for proposed wells Wainwright #10 and #11 Proposed Depth: MD: 3,000' TVD: 3,000' Survey: Conduct geophysical logs (caliper, gamma, resistivity, density, sonic) Property Ownership: Surface: Olgoonik Corp. Sub - surface: BLM RECEIVE Applicant / Operator: USGS. \IAR 1 8 "i `_1`' Oil & Gas Co , Comrnissioo AOGCC Permit to Drill. Form 10 -401. Anchorage Wainwright #11 March 06, 2009, Page 1 of 25 • • Application for Permit to Drill. Contents of Application Application Summary. Contents of Application. Project Description and Overview. Permit to Drill, Form 10 -401. Designation of Operator, Form 10 -411. Figure #1. Wainwright Townsite. Plat T15N R32W UM. Figure #2. Location of Proposed Offset Wells #10 -11. Wainwright Townsite. Plat T15N R32W, Sec 24, 25 UM. Figure #3. Location of Proposed Offset Wells #10 -11. Wainwright, Aerial Photo. Figure #4. Location of Proposed Offset Wells #10 -11 Shown with the Runway Protection Zone, Wainwright Airport. Figure #5. Location of Proposed Offset Wells #10 -11, Spacing Exemption. Plan View. Explanation of land Ownership shown on Figures #1 and #2. Plat T15N R32W. Wells #10 -11. Permission to Enter Lands and Drill from the Land Owners: • Surface Estate: Olgoonik Corp. • Subsurface Estate: BLM. Requested Waivers and Drill Spacing Exemptions. Bonding requirements of 20 AAC 25.025, • Blowout prevention equipment requirements of 20 AAC 25.035. • Well bore survey requirements of 20 AAC 25.050(a)(2). • Well site seismic survey requirements of 20 AAC 25.061(a). • Gas detection requirements of 20 AAC 25.066. AOGCC Permit to Drill. Form 10 -401. Wainwright #11 March 06, 2009, Page 2 of 25 • Well Spacing Exemption Requested: • Requested exception for the well spacing requirements of 20 AAC 25.055(a) for proposed wells Wainwright #10 through #11. Figure #6. Diverter Diagram. Figure #7. Well Spacing Exemption Checklist. Figure #8. Letter from the President of Olgoonik Corp. regarding the public involvement and knowledge of the drilling program in Wainwright. Drilling Plan • Offset Wells. • Logging. • Decommission wells in 2009 Drilling Fluid Plan Figure #9. Depth v Time Graph, Offset Well. Borehole Sampling. Well Closure Procedures. Other Permits • DNR Temporary Water Use Authorization for 4,000gpd, 150,000 gal total. ACMP B -List GCD -8, and No Review Required decision. • ADEC ODPCP Exemption. • ADEC Solid Waste Disposal for cuttings, Plan Review • ADEC Drill Fluids and Produced Water Disposal. • NSB Development Permit, Planning Department. • NSB Dept. of Civil Works, approval to use of landfill for cuttings disposal. • FAA Determination of No hazard to Air Navigation, Wainwright Airport. AOGCC Permit to Drill. Form 10 -401. Wainwright #11 March 06, 2009, Page 3 of 25 • • Project Description and Overview Alaska Rural Energy Project Wainwright, Alaska, 2009 The Alaska Rural Energy Project is currently conductng a multi -well production test in Wainwright at the same location (Olgoonik Wareyard) as where exploration and testing activities occurred in June -July 2007. All wells have been be completed in an 8 ft coal , seam encountered at a depth of -1242 to 1250 ft. The test array consists of one central production well (10" hole with 6" steel casing cemented to -1240 ft, 6" open -hole completion through the coal zone) and 4 monitor wells (6" hole with 2.5" PVC casing, 10 ft of slotted PVC screen in the coal, sand packed around screen, annular area grouted (abandonment bentonite and cement) to land surface). Additionally, a separate well (which is currently permitted) will be drilled at the Wainwright landfill. Two additional off -set wells (proposed Wainwright #10 and #11) will be drilled during the summer 2009 season. For all three off -set wells a 6 inch steel surface casing will be set and cemented to a depth of -50 ft and a 6 inch open hole drilled to a depth of -1500-2000 ft. Core samples will be collected from the 1242 -ft coal ' bed and associated roof and floor rock. Geophysical logs (caliper, resistivity, gamma, density, sonic) will be run in the well and permeability tests will be conducted after which the wells will be plugged and abandoned with bentonite grout and cement. The following information will be gathered from these wells: • Lateral extent and continuity of individual coal seams between original site and landfill site (- 2 miles), and the airport runway in Wainwright. • Confirm gas content of the 1242 -ft coal bed • • Accurate determination of hydraulic conductivity and transmissivity • Storage coefficient (amount of water to be produced) • Detailed produced water chemistry Drilling is scheduled to begin on or about June 1, 2009 and completed on or about August 10, 2009. The first well drilled will likely be the landfill. Exact start and finish , dates for each well cannot be accurately predicted at this time. The offset wells will be abandoned in 2009. AOGCC Permit to Drill. Form 10 -401. Wainwright #11 March 06, 2009, Page 4 of 25 S STATE OF ALASKA ALASKA OIL AND GAS CONSERVATION COMMISSION DESIGNATION OF OPERATOR 20 AAC 25.020 1. Name and Address of Owner: Bureau of Land Management, 222 We Seventh Ave., #13, Anchorage, AK 98513 2. Notice Is hereby given of a designation of operators hip for the oil and gas property described below: Legal description of property: Well Name and Number: Wainwright #11, (Exploration, Offset Well) Well Location Area: North Slope Borough, Airport at Wainwright Well Location Legal: MTRS: Umiat T15N R32W, Sec. 24. FNL:4310' FEL:2280' NAD83 Lat.: 70°38'8.89 "N Long.: 180°1'48.34'W State Base Plane Coordinates. Zone 8 x- 1393479.238 y- 8085777.782 Property Plat Attached: 3. Name and Address of Designated Operator. US Geological Survey, PO Box 25048, MS 408, Denver Federal Center, Denver, CO 80225 4. Effective Date of Designation: 5. Acceptance of operatorship for the above described property within all attendant responsibilities and obligations Is hereby acknowledged: Signature Date Printed Name Title 6. The Owner hereby cedillas that the foregoing Is true and correct (attach Power of Attorney or other evidence of authority of person signing): Signature Date Printed Name Title 7. Approved: Commissioner Date Approved: Commissioner Date Approved: Commissioner Date (Requires approval by two Commissions's) Form 10-411 Rev.12/2005 Submit in duplicate Designation of Operator, Form 10-411 AOGCC Permit to Drill. Form 10 -401. Wainwright #11 March 06, 2009, Page 6 of 25 • • SURVEYED TOWNSHIP 15 NORTH RANGE 32 WEST OF THE UMIAT MERIDIAN, ALASKA STATUS OF PU$UC DCUAS / LAND AND MINERAL TITLES i MTP %' SUPPL SEC 24, 25 CHUKCHI / NC 1 SEA / row 'tH_" GFFGC //NG u /1.00, OH✓2 OF OFF :,FF.O,F0 LAWS Nf1.11V N tOH ZASSW:.O.W .10.441.04,0 1 IGN,1 /O" OIH,.'GNJC 000 / Nteth .O 10.0, a rMS 00 :0 <H/5: /4 11 % 2411 ara r : Sr5T AtA b N P..tfrr Jn>rms. +l>r:a + ./.rrrr O W I � nc. cm k0 41 69w a .Y 94 -1tP N / 011e-s1 Secs 24 XT ,I 9f-1, �s i i ssr e ' s 6 % 6 a ./ , -/ Wcvnwngh1 / In/ct / 25 %, / %/ L, / Figure #1. Wainwright Townsite. Plat T15N R32W UM. AOGCC Permit to Drill. Form 10-401. Wainwright #11 March 06, 2009, Page 7 of 25 II II SURVEYED TOWNSHIP 15 NORTH,RANGE 32 WEST OF THE UMIAT MERIDIAN, ALASKA F STATUS OF PUBLIC DOMAIN LAND AND MINERAL TITLES / mu oe, a r... a. MTP ..,.,...... �. IT•.TI / SUPPI Sec 24, 25 .a...» s.. PERMITTED WELLS -�—� / : , ' �.T[ ,. " TO iLiYK / . ' w .....T -.one /' wps., Co. wwWl•MISI�� t• / �Iiie� 5t. / rrxa i�MO�� MINIM _ ��!♦ ,4 °".'"' ' / . .. PVir L A W I E Pa'�•u dig xs a - 4 / � / ��.u. :xps Tare � 1 44.PLO.. 4 #,' / rr.ia ` / f 1.i!I14N1 =•n / ♦ �i y// "_, _/., q B . a , • Well #11,OEfset l,. / / Well #10 Offset / / / / PROPOSED WELLS #10 and #11. / / / SURFACE ESTATE OWNER: OLGOONIK CORP. SUBSURFACE ESTATE OWNER: FEDERAL, BLM — ID To .,,. .... ma ur •.x..,• . T _11 _10 .—M-11 w mawr.r ......._... W v "Fr....; A Figure #2. Location of Proposed Offset Wells #10 -11. Wainwright Townsite. Plat T15N R32W, Sec 24, 25 UM. AOGCC Permit to Drill. Form 10 -401. Wainwright #11 March 06, 2009, Page 8 of 25 • • z Permitted, drilled e • • ells #348_ • r • • Production Test . . rid Monitoring. 9 tOC yard. ♦ r 4 • • 4 w • • • . • • • • • s • #• ; Wainwright 4 t ` 1 ♦. . ! pi s . '' e • Pros i sed Wells #10 and #11. Offset southwest of Runway. im.ge o 200$ Oipit. Gfabe .':Ot n 0 2008 Tele M.. Figure #3. Location of Proposed Offset Wells #10 -11. Wainwright, Aerial Photo. AOGCC Permit to Drill. Form 10 -401. Wainwright #11 March 06, 2009, Page 9 of 25 • • 14 ♦ $!t 411 4 A. • + R � P Wells #10 and #11. RPZ: Runway Offset. Protection Southwest of Runway. Zone RPZ: Runway (Ultimate) Protection Zone Runway (Existing) 0 4 Airport Property Boundary #10 .+Aqe c :VOA U:$4•,...c Google ,,05 ,t Figure #4. Location of Proposed Offset Wells #10 -11 Shown with the Runway Protection Zone, Wainwright Airport. AOGCC Permit to Drill. Form 10-401. Wainwright #11 March 06, 2009, Page 10 of 25 • • 16,r 410 .WAINWRIGHT 3 r Drilled) t • �t . ,, o Ike IT -754 a �' 40131100kfilAtt,0,0MAt Oiain.wigh1 In • r OS • d WAINWRIGHT 11 (Proposed) WAINWRIGHT 10 (Proposed) s.�i.zN.,. _ uAu' Jr - tasCX . :i4�. 02007 n Image 02009 DlpAel6lobe 02009 Tele Atlas Figure #5. Location of Proposed Offset Wells #10 -11, Spacing Exemption. Plan View. AOGCC Permit to Drill. Form 10 -401. Wainwright #11 March 06, 2009, Page 11 of 25 • • Explanation of Land Ownership. Plat of T15N R32W. UM Section 24 and 25. Patent Number 50 -77 -0089 conveyed surface estate to Olgoonik Corporation on the following parcels of land (refer to plat): The subsurface estate was reserved to the Federal Government. Patent Number 50 -85 -0526 conveyed the surface estate to Olgoonik Corporation on the following parcels of land (refer to plat): USS 4418, Tr B The subsurface estate was reserved to the Federal Government. • AOGCC Permit to Drill. Form 10 -401. Wainwright #11 March 06, 2009, Page 12 of 25 • • Permission to Enter Lands and Drill from the Surface Land Owner. Surface Estate: Olgoonik Corp. June 7, 2007 Ma. Beth Maclean Bureau of Land Management 222 West Seventh Avenue, #13 Anchorage, AK 99513 Dear Ms. Maclean: Olgoonik Corporation (OC) is supportive of your efforts to evaluate coalbed natural gas potential of Wainwright as outlined in the town meetings you have held in Wainwright. We appreciate the effort that you have put forth on this project on behalf of our community. • OC has land entitlements within the city limits of Wainwright and also outside of these boundaries. OC recognizes the benefits that could occur from having a local, energy source available for the community. We recognize the cooperative work planned between Federal, State, and the private sector and are pleased to be a part of this effort in conjunction with Arctic Slope Regional Corporation. We appreciate the fact that the Bureau of Land Management and US Geological Survey are making a good faith effort to involve local communities in locating local sources of energy in rural Alaska. Sincerely, vek Lucille Mayer President, Olgoonik Corporation Cc: Teresa Imm, Arctic Slope Regional Corporation AOGCC Permit to Drill. Form 10 -401. Wainwright #11 March 06, 2009, Page 13 of 25 • • Waivers and Drill Spacing Exceptions Alaska Rural Energy Project Wainwright, Alaska, 2009 The Permit to Drill application includes requests for waivers for proposed wells Wainwright #10 and #11 for the following: • The bonding requirements of 20 MC 25.025, • The blowout prevention equipment requirements of 20 AAC 25.035 • The well bore surveys requirements of 20 MC 25.050(a)(2), • The well site seismic survey requirements of 20 AAC 25.061(a), • The gas detection requirements of 20 AAC 25.066. The Permit to Drill application includes a requested exception for the well spacing • requirements of 20 MC 25.055(a) for proposed wells Wainwright #10 through #11 Information in Support of Requested Waivers and Well Spacing Exemptions Bonding Waiver Request The operator is the US Department of the Interior, Geological Survey. The Department is self- insured under the Federal Tort Claims Act, 28 USC Sec. 26.71. BOP Waiver Request. For the previous permit to drill at this location at the Village of Wainwright #1 through #8, the operator (DOI) examined all well logs for the wells within the general vicinity of the Wainwright #1 well. They included Tunalik, Kugrua, and Peard Bay. In the upper 3,500 feet of each of these wells, measurable gas readings were associated with coal seams only. Mud weights were kept between 9 -10 pounds per gallon (ppg) above 3,500 feet in each well indicating that no overpressured conditions were expected or encountered. Seismic information shows no indication of the presence of shallow gas. In addition, . drilling records and mud log information from the nearest exploration wells show no indication of abnormal pressure. Additionally, the Wainwright #1 and #2 wells that were drilled to a depth of 1,613' in 2007 encountered no gas kicks. The Wainwright #3 through #8 wells that were drilled ' to a depth of 1,200' +1- in 2008 encountered no gas kicks AOGCC Permit to Drill. Form 10-401. Wainwright #11 March 06, 2009, Page 14 of 25 C * 2* 1 la 0 0 a Z G) 7' 1 : o 1 3 co c Drilling Rig DOI Drilling Operation Diverter Head 0 E; to 0 a 0:1 , 5 as .. Mfg. Washington Rotating Head ..i • .4" 3.5° core rod 01 -11 h3 3 < M Valve • o P- g 91 iir ..1 100 psi rubber seal _C3. • Diverter to T-fitting e 1)■ ii To holding pit 113 head • . . 3 ----"-- Threaded coupler-. E e 6 5/8" OD Valve . Conductor 03 casing z P 0 10 i I I toki 0 I 4 V 3 U. Fluid discharge to recirculation pit -il- . ,..:,xj,-1: • • v 40-80 bis --. - Diverter photograph • The proposed 2009 drilling of Wainwright #10 and #11 will use a weighted mud system typically ranging from 9.0 ppg -9.8 ppg. If over - pressured gas is encountered, a 10.5+ • ppg mud will be circulated down the well to stop the gas from venting. Optionally, a cement slurry weighing from 13 ppg -15 ppg could be mixed and pumped through the . drill steel from the bottom to the surface to kill the well. In this situation, the well would be considered abandoned. If a gas kick were to be encountered, the amount of gas that can safely be vented during drilling is considerable. The operator is proposing to utilize a Washington stripping head sealing 3'/2" drill pipe on 6 5/8" casing, and a 40 foot by 4" ID blooey line. Well Site Seismic Survey Waiver Request. DOI, the operator, has examined two seismic surveys in the Wainwright area. The first is an E -W line that runs from the S. Meade well to the Arctic coast approximately 5 -10 miles SW of Wainwright. The second is a NE -SW line that parallels the coastline from north of the Peard Bay well to north of the Tunalik well and runs directly through Wainwright. These surveys, while shot for deeper targets, do not show any shallow • hazards in the vicinity of the proposed drill site. Gas Detection Requirements, H2S and Methane Waiver Request For the previous permits to drill at this location at the Village of Wainwright (Wainwright #1 through #8) the operator (DOI) examined all well logs for the wells within the general vicinity of the Wainwright #1 well. They included Tunalik, Kugrua, and Peard Bay. In the upper 3,500 feet of each of these wells, measurable gas readings were associated • with coal seams only. Mud weights were kept between 9 -10 pounds per gallon (ppg) , above 3,500 feet in each well indicating that no overpressured conditions were . expected or encountered. The drilling will be done with a portable truck - mounted drilling rig. This equipment has no enclosures where methane could accumulate sufficiently to pose a risk of explosion • or fire, or where a methane detector could practicably be located. Additionally, the Wainwright #1 and #2 wells that were drilled in 2007, and the Wainwright #3 through #8 wells drilled in 2008 encountered no gas kicks. • Requested exception for the well spacing requirements of 20 MC 25.055(a) for proposed wells Wainwright #10 and #11. Well #10 and #11 both require a spacing exception because they are closer that 3,000' to state submerged lands, Chukchi Sea and Wainwright Inlet. AOGCC Permit to Drill. Form 10-401. Wainwright #11 March 06, 2009, Page 16 of 25 • • CHECKLIST - SPACING EXCEPTION APPLICATION OPERATOR USGS PROPERTY ID/ LEASE S: N/A FIELD /POOL Wainwright, Coal Bed Methane PI /BH: WELL NAME Wainwright #10 & #11. VERTICAL x EXPLORATORY x GAS x DEVIATED DELINEATION OIL DEVELOPMENT SURFACE LOCATION ' F L and 'F L, S. ,T , R , M PRODUCTIVE INTERVALS ' F L and 'F L, S. , T , R , M (Top and Bottom) See BOTTOM HOLE ' F L and ' F L, S. , T , R , M Applications Check applicable reason(s) for spacing exception per 20 AAC 25.055(a): (1) to drill a well for oil within 500 feet of a property line where ownership or landownership changes, x (2) to drill a well for gas within 1500 feet of a property line where ownership or landownership changes, (3) to drill and complete more than one oil well in a governmental quarter section; or to drill and complete an oil well closer than 1000' to any well drilling to or capable of producing from the same pool, (4) to drill and complete more than one gas well in a governmental section; or or to drill and complete a gas well closer than 3000' to any well drilling to or capable of producing from the same pool. Does the application contain: x A brief explanation for why the operator has chosen to drill the specified location. A plat drawn to a scale of one inch equaling 2,640 feet or larger, showing the location of the well or portion of the well for which the exception is sought, all other x completed and drilling wells on the property, and all adjoining properties and wells within 1,000 feet of a well or portion of the well requiring the spacing exception that is drilling for oil or within 3,000 feet of a well or portion of the well requiring the spacing exception that is drilling for gas. The names of all owners, landowners, and operators of all properties within 1,000 feet of a well or portion of the well requiring the spacing exception that is drilling for x oil or within 3,000 feet of a well or portion of the well requiring the spacing exception that is drilling for gas. A copy of the notice sent by certified mail to the owners, landowners and operators described above, the date of mailing, and the addresses to which the notice was sent. x An affidavit by a person acquainted with the facts verifying that all facts are true and that the plat correctly portrays pertinent and required data. if the operator requests a variance from the notice requirements of x 20AAC25.055(d), sufficient information to demonstrate that it is not feasible to comply with the notice requirements because of the complexity of ownership within the notice area. Figure #7. Well Spacing Exemption Checklist. 9 p 9 P AOGCC Permit to Drill. Form 10 -401. Wainwright #11 March 06, 2009, Page 17 of 25 • • June 7, 2007 Ms. Beth Maclean Bureau of Land Management 222 West Seventh Avenue, #13 Anchorage, AX 99513 Dear Ms. Maclean: Olgoonik Corporation (OC) is supportive of your efforts to evaluate coalbed natural gas potential of Wainwright as outlined in the town meetings you have held in Wainwright. We appreciate the effort that you have put forth on this project on behalf of our community. OC has land entitlements within the city limits of Wainwright and also outside of these boundaries. OC recognizes the benefits that could occur from having a local, energy source available for the community. We recognize the cooperative work planned between Federal, State, and the private sector and are pleased to be a part of this effort in conjunction with Arctic Slope Regional Corporation. We appreciate the fact that the Bureau of Land Management and US Geological Survey are making a good faith effort to involve local communities in locating local sources of energy in rural Alaska. Sincerely, vat Lucille Mayer President, Olgoonik Corporation Cc Teresa Imm, Arctic Slope Regional Corporation Figure #8. Letter from the President of Olgoonik Corp. regarding the public involvement and knowledge of the drilling program in Wainwright. AOGCC Permit to Drill. Form 10 -401. Wainwright #11 March 06, 2009, Page 18 of 25 Drilling Plan. Alaska Rural Energy Project Wainwright, Alaska, 2008 Airport Offset Wells 1. Move equipment to airport sites. Drill 9 7/8" hole through surficial deposits to depth of -50'. Set and cement 6 5/8" schedule 40 steel surface casing. 2. Mud rotary 6" open hole (no core) to between 1500 and 2000 ft. • 3. Core will be collected from the 1242 -ft coal bed and associated roof and floor rock ( -100 ft total core) 4. Conduct geophysical logs (caliper, gamma, resistivity, density, sonic) • 5. Conduct single -well permeability (drawdown - recovery) test 6. Abandon well with abandonment bentonite grout and cement. AOGCC Permit to Drill. Form 10 -401. Wainwright #11 March 06, 2009, Page 19 of 25 • • Decommission Wells • Abandon well with abandonment bentonite grout and cement. • Clean and Pack equipment. Transport equipment from Wainwright via barge. AOGCC Permit to Drill. Form 10 -401. Wainwright #11 March 06, 2009, Page 20 of 25 • • Borehole Sampling. Alaska Rural Energy Project Wainwright, Alaska, 2009 Airport Offset Wells During the drilling of the landfill offset well, mud -gas will be continuously monitored to detect the presence of hydrocarbons in the drill mud. Borehole cuttings will be collected, described, washed, and bagged at 10 -ft intervals. AOGCC Permit to Drill. Form 10 -401. Wainwright #11 March 06, 2009, Page 21 of 25 • • Days 0 1 1 2 3 4 5 6 7 9 -500 -- Set and cement surface casing - 1000 Well abandonmert -1500 ° -2000 -2500 -3000 Geophysical logging -3500 - Figure #9. Depth v Time Graph, Offset Wells at the Wainwright Airport. AOGCC Permit to Drill. Form 10 -401. Wainwright #11 March 06, 2009, Page 22 of 25 • • Drilling Fluid Plan Alaska Rural Energy Project Wainwright, Alaska, Summer 2009 The hole will be drilled using standard fresh water bentonite drilling fluids. Additives to be used include (all listed products are NL Baroid trade names): • Quick -Gel high yield bentonite (hole stability, circulation control, clay -shale control) • Aqua -Gel bentonite (hole stability, circulation control, mud - density control) • Pac -L and Pac -R powdered cellulose polymer (clay -shale control, water loss, viscosity control) • EZ mud liquid polymer (clay -shale control, water loss, viscosity control) • Pennetrol liquid detergent (bit cleaning, control clay build up around bit face and teeth) Drill fluids will be monitored for viscosity, weight, and temperature on a full -time basis. Drilling fluids will have cuttings removed and will be recirculated via a 1000 gallon trailer- mounted shaker system incorporating shaker screens and centrifugal desilting cones. Cuttings and used drill mud will be contained in above - ground tanks. At project's end, cuttings /mud will be disposed of at the Wainwright wastewater disposal pond. Rotary drilling and reaming operations will be conducted using a rig- mounted 5 1 /2" X 8" 350 gpm, duplex mudpump and a Gardner- Denver 5" x 6 ", 200 gpm, duplex mudpump. AOGCC Permit to Drill. Form 10 -401. Wainwright #11 March 06, 2009, Page 23 of 25 • 0 Well Closure Procedures Alaska Rural Energy Project Wainwright, Alaska, Summer 2009 During drilling and coring operations, aquifers will be protected by mixing bentonite and . polymer additives in the drill mud specifically designed to seal and protect water - bearing strata. Encountering water bearing strata that could contain a useable aquifer is not expected since the drilling will be within the permafrost. Upon completion of the airport offset wells, the wells will be plugged from total depth to 100 ft below land surface (Ws) with an abandonment bentonite grout mixture mixed at land surface with a grout plant and pumped from the bottom up. The top 100 ft of the , well will be filled with Arctic -blend cement. AOGCC Permit to Drill. Form 10 -401. Wainwright #11 March 06, 2009, Page 24 of 25 • Other Permits Alaska Rural Energy Project Wainwright, Alaska, Summer 2009 DNR Temporary Water Use Authorization for 4,000gpd, 150,000 gal total. ACMP B -List GCD -8, and No Review Required decision. ADEC ODPCP Exemption. ADEC Solid Waste Disposal for cuttings, Plan Review ADEC Drill Fluids and Produced Water Disposal. NSB Development Permit, Planning Department. NSB Dept. of Public Works, approval to use of landfill for cuttings disposal. FAA Determination of No Hazard to Air Navigation, Wainwright Airport. AOGCC Permit to Drill. Form 10-401. Wainwright #11 March 06, 2009, Page 25 of 25 • _ S'A'n ASIKQ:\ SARA/HPNsGORNOR 555 Cordova Street DEPT. OF ENVIRONMENTAL CONSERVATION. Anchorage, AK 99501 PHONE: (907) 269 -3094 DIVISION OF SPILL PREVENTION AND RESPONSE FAX: (907) 269 - 7687 INDUSTRY PREPAREDNESS PROGRAM httn:l/www•dec.state.ak.us Exploration Production & Refineries June 5, 2009 File No: 305.05 (BLM Wainwright CBM) Mr. Tom Mortensen Tom Mortensen Associates, LLC Environmental Permitting & Management P.O. Box 113.192 Anchorage, AK 99511 -3192 Subject: Exemption from Oil Discharge Prevention and Contingency Plan and Financial Responsibility Requirements for Wainwright Nos. 10 and 11 Coal Bed Methane Exploratory Wells, Wainwright, Alaska Dear Mr. Mortensen: The Alaska Department of Environmental Conservation (ADEC) has received a determination from the Alaska Oil and Gas Conservation Commission (AOGCC) regarding a request from the U.S. Geological Survey (USGS) in cooperation with the U.S. Bureau of Land Management (BLM) and Arctic Slope Regional Corporation (ASRC) for an exemption from Oil Discharge Prevention and - Contingency Plan (ODPCP) and Financial Responsibility (FR) requirements. The exemption request dated May 1, 2009 was submitted by Tom Mortensen Associates, LLC. The USGS intends to drill Wainwright Nos. 10 and 11 exploration wells to test for coal bed methane (CBM) near Wainwright,, Alaska. AOGCC reviewed confidential and public well record information in making their May 27, 2009 determination (attached). AOGCC determined that there is a reasonable certainty that the wells will not penetrate a formation capable of flowing oil to the ground surface in accordance with AS 31.05.030(1). Based upon AOGCC's evaluation and determination, ADEC hereby finds that the • Wainwright Nos. 10 and 11 wells meet the standards for exemption as a natural gas exploration facility under AS 46.04.050(c) and are exempt from ODPCP and FR requirements found in AS 46.040.030 and AS 46.040.040. Be advised that should the USGS penetrate a formation capable of flowing oil to the ground surface during the drilling of these wells, operations must immediately be suspended and ADEC must be immediately notified. The USGS must obtain ODPCP and FR approval by ADEC prior to proceeding. This exemption does not relieve the USGS of the responsibility for securing other Printed au Recycled Paper Mr. Torn Mortensen • 2 • June 5, 2009 Toni Mortensen Associates, LLC federal, state or local approvals or permits. The USGS is still required to comply with all other applicable laws. APPEAL: This is a final decision. Aggrieved persons with standing may appeal this decision to the Alaska Superior Court within 30 days as provided by the Alaska Rules of Appellate Procedure. If you have any questions, please contact Laurie Silfven at 269 -7540 or me at 269 -3054. Sincerely, C Jl'�1,J�sY1� — Betty Sclik Program anager Attachment: AOGCC May 27, 2009 letter to EPR Section Manager Electronic cc: Laurie Silfven, ADEC Chris Pace, ADEC John Norman, AOGCC Steve Davies, AOGCC Nina Brudie, ADNR cc: Johnny Aiken, NSB Arthur Clark, USGS Bob Fisk, BLM Teresa Imm, ASRC i 3r. • . TiggE unsgn SARAH PAULA, GOVERNOR tie ALASKA � OIL AND GAS 333 W.7thAVENUE, SUITE 100 CO1SERVA►� COMMISSION ANCHORAGE, ALASKA 99501 -3539 . l� ii PHONE (907) 279 -1433 FAX (907) 276-7542 May 27, 2009 Dianne Munson MAY 2.9 2009, . Acting Section Manager Dept. of Environmental Conservation OEPARTMENTOF Division of Spill Prevention and Response ' ` s' '' ENTAL.CO NS z •t ATION Exploration, Production & Refineries 555 Cordova Street Anchorage, AK 99501 Re: Request for Determination Under AS 31.05.030(1) for Coal Bed Methane Exploratory Wells Near Wainwright, Alaska • Dear Ms. Munson: By letter dated May 1, 2009, Tom Mortensen Associates, LLC (Mortensen) requested an ' exemption under AS 46.04.050(c) from the. State of Alaska's oil discharge prevention and contingency plan requirements (AS 46.04.030) and financial responsibility requirements (AS 46.04.040) for the proposed Wainwright coal bed methane exploratory wells planned by the U.S. Geological Survey (USGS) in and near Wainwright, Alaska. On May 4, 2009, the Alaska Oil and Gas Conservation Commission (Commission) received Mortensen's May 1, 2009, letter. AS 31.05.030(1) Under AS 31.05.030(1), the Commission makes determinations that result in the exemption of wells at a "natural gas exploration facility" from the requirements of AS 46.04.030 and AS 46.04.040. Mortensen's May 1, 2009, letter is an application for such a determination. Determination Based on the documents reviewed, the evidence shows with reasonable certainty that the proposed Wainwright Nos. 10 and 11 coal bed methane exploratory wells will not penetrate a formation capable of flowing oil to the ground surface. Documents Reviewed The Commission has reviewed the following documents: 1) confidential well records for the nearby Wainwright Nos. 1, 2, 3, 4, 5, 6, and 8 exploratory coal bed methane wells; and 2) public well records, including mud logs, for the Tunalik No. 1, Peard Test No. 1 and Kugrua No. 1 exploratory wells. • Diane Munson ;r May 27, 2009 • • Page2of2 Findings 1. The information examined shows that the planned Wainwright Nos. 10 and 11 exploratory coal bed methane wells will be used solely for the exploration for natural gas. 2. None of the information examined even suggests that in the vicinity of the planned wells the formations that would be penetrated will be capable of flowing oil to the ground surface. Please contact Mr. Steve Davies (at 907 - 793 -1224 or steve.davies ®alaska.gov) if you have questions concerning this letter. Daniel . Seamount, Jr. 1 r 4 1 o Cathy . Foerster Chair •mmis loner Commissioner cc: Laurie Silfven, DEC Tom Mortensen Associates, LLC Art Clark, USGS 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 after 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 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. I TRANSMITTAL LETTER C HECKLIST WELL NAME //✓p 1 Yl C- t,)''l sit 7 / / PTD# 7-0 L / Development Service Exploratory Stratigraphic Test Non - Conventional Well FIELD: e-7<-r )` ci I &� POOL: 1 Circle Appropriate Letter / Paragraphs to be Included in Transmittal Letter CHECK ADD -ONS WHAT (OPTIONS) TEXT FOR APPROVAL LETTER APPLIES MULTI LATERAL The permit is for a new wellbore segment of existing well , (If last two digits in Permit No. , API No. 50- - - . API number are between 60 -69) Production should continue to be reported as a function of the original API number stated above. PILOT HOLE In accordance with 20 AAC 25.005(0, all records, data and logs acquired for the pilot hole must be clearly differentiated in both well name ( PH) and API number (50- - - ) from records, data and logs acquired for well . SPACING The permit is approved subject to full eo ipliance with 20 AAC EXCEPTION 25.055. Approval to perforate an .roduc.0/ inject is contingent upon issuance . of a conse atio .. r approving a spacing ,/ exception. 3 7 a lo .,_. Cc t assumes the liability of any protes to the cing exceptio may occur. DRY DITCH All dry ditch sample sets submitted to the Commission must be in 7 SAMPLE no greater than 30' sample intervals from below the permafrost or from where samples are first caught and 10' sample intervals through target zones. Non - Conventional Please note the following special condition of this permit: Well production or production testing of coal bed methane is not allowed for (name of well) until after (Company Name) has designed and implemented a water well testing program to provide baseline data on water quality and quantity. (Company Name) must contact the Commission to obtain advance approval of such water well testing program. / / / 01.t /;tc y-7)4/ t1/ /7a,¢' 0 , // 4 / i: / r5 rev Rev: 1/11/2008 f� a / / WELL PERMIT CHECKLIST Field & Pool Well Name: WAINWRIGHT 11 Program EXP Well bore seg ❑ PTD#: 2090360 Company U S DEPT OF INTERIOR Initial Class/Type EXP / PEND GeoArea 89Q Unit On /Off Shore On Annular Disposal ❑ Administration 1 Permit_fee attached NA 2 Lease number appropriate No No lease_invol_ved: _BLM_land, SPACING EXCEPTION NEEDED because of nearby shoreline (Fed -State boundary 3 Unique well name and number Yes 4 Well located in a defined pool No Exploratory CBM well 5 Well located proper distance from drilling unit boundary No SPACING EXCEPTION NEEDED:7thwell in_$ec._ 24: may require an exception if Wainwright 10 is drilled first. 6 Well located proper distance from other wells Yes Nearest well will be Wainwright 10, -1850' to SSE. 7 Sufficient acreage available in drilling unit No 7th well in Section 24 8 If deviated, iswellbore plat included No Vertical well 9 Operator only affected party NA Received designation of operator form on 3/16/2009 in which Bl_M designates USGS as operator of the well 10 Operator has appropriate bond in force NA WAIVER NEEDED: Hearing regarding waiver of bond requirements required. 11 Permit_can be issued without conservation order NA Appr Date 12 Perrnit_can be issued without administrativ_e_approvai Yes SFD 6/3/2009 13 Can permit be approved before 15 -day wait Yes • 14 Well located within area and strata authorized by Injection Order # (put 10# in comments) (For : NA 15 All wells within 1(4_mile area of review identified (For service well only) NA 16 Pre - produced injector: duration of pre production less than 3 months_ (For service well only) NA 17 Nonconven gas conforms to AS3105 03Q0.1.A),(1,2.A -D) Yes Permafrost is about 1000' thick. No freshwater aquifers serve or will serve as sources of drinking water. 18 Conductor stringprovided Yes 6 -5/8 © 80'. Engineering 19 Surface casing_protectsall known U$DWs NA No known USD Ws. 20 CMT vol_ adequate to circulate on conductor & surf csg Yes Adequate excess for conductor. 21 CMT vol adequate _to tie -in long string to surf csg NA 22 CMT will coverall known productive horizons No 23 Casing designs adequate for C,_T, B _&_ permafrost Yes 24 Adequate tankage_or reserve pit Yes Plan states rig equipped with tanks. 25 if a_re- drill, has_a 10-403 for abandonment been ap proved NA 26 Adequate wellbore separation proposed Yes Nearest proposed well _(Wainwritht_ #10) -1020' away. 27 if diverter required, does it meet regulations Yes Will employ a rotating head. Rotating head will protectdriler's area and divert flow. Appr Date 28 Drilling fluid_ program schematic & equip _list adequate Yes Expected formation pressure 9.0 - 9,8_EMW._ Provision to weight up g to 10.5 ppi needed. TEM 6/4/2009 29 BOPEs,do they meet regulation No BOP exception requested. Granted by CO 618. 30 BOPE_press rating appropriate; lest to(put psig in comments) NA • 31 Choke manifold complies w /API RP -53 (_May 84) NA 32 Work will occur without operation shutdown Yes 33 is presence of H2S gas probable No 34 Mechanical condition of wells within /NOR verified (For service well only) NA 35 Permit_can be issued w/o_ hydrogen_ sulfide measures Yes WAIVER REQUIRED for gas detection equipment. Geology Y Offset seismic and wide s Y 36 Data_presented on_ potential overpressure zones b separated well control examined by_ no an shallow drillin Appr Date 37 Seismic analysis of shallow gas zones Yes hazards are indicated. _ None encountered in previous Wainwright coal bed methane test wells. SFD 6/3/2009 38 Seabed condition survey(if off-sh NA 39 Contact name /phone for weekly_progress repods_[exploratory only] Yes Art Clark 303 - 236 -5 793 Geologic Engineering • .lic EXCEPTION AND WAIVERS REQUIRED: Wainwright 11 will require an exception to 20 AAC 25.055(a)(4) because it will be the 7th well in Section 24. Commissioner: Date: Commissioner: Date loner Date Wainwright 11 may require an exception to 20 AAC 25.055(a)(4) if Wainwright 10 is drilled first, because Wainwright 11 will be about 1,860' from Wainwright fkia / .. Ire D /� 10. WAIVERS REQUESTED from the following requirements: BOPE Equipment, well bore survey, well site seismic survey, and gas detection. (Federal -State 6 4 property line). Waiver needed from bonding requirements. 1O U' 9
