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207-169
• 0 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. cQ 0 7 - 1 6 9 Well History File Identifier Organizing (done) Two -sided HIM KIM ❑ Rescan Needed 1 I 1 1111 I RI RES AN DIGITAL DATA OVERSIZED (Scannable) Color Items: ❑ Diskettes, No. ❑ Maps: reyscale Items: ❑ Other, No/Type: ❑ Other Items Scannable by a Large Scanner /Door Quality Originals: I i OVERSIZED (Non - Scannable) ❑ Other: ❑ Logs of various kinds: NOTES: ❑ Other:: BY: Date: //6// /s/ Project Proofing I MI11111111 BY: Date: V/6// a /s/ Of Scanning Pre . aration 3 x 30 = 9 ° + . 5-6 = TOTAL PAGES q,.5 BY: ® Date: 7// (Count does not include cover sheet) � Y `� /s/ Production Scanning I 1111111111111111 Stage 1 Page Count from Scanned File: q A (Count does include cove heet) Page Count Matches Number in Scaning Preparation: V YES NO BY: Date: 7/f/ia /s/ (yip 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. N111111111 I ReScanned I 111111111 MI BY: Maria Date: /s/ Comments about this file: Quality Checked III II'IIIIII II'I III 12/22/2011 Well History File Cover Page.doc DATA SUBMITTAL COMPLIANCE REPORT 7/312012 Permit to Drill 2071690 Well Name /No. NORTH ALEXANDER 1XX Operator PACIFIC ENERGY RESOURCES LTD API No. 50- 283 - 20123 -00 -00 MD TVD Completion Date Completion Status Current Status EXPIR UIC N REQUIRED INFORMATION Mud Log Yes Samples No Directional Survey Yes 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 / IP 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 Cores and /or Samples are required to be submitted. This record automatically created from Permit to Drill Module on: 3/31/2008. ADDITIONAL INFORMATION Well Cored? Y / N Daily History Received? Y / N Chips Received? Y / N Formation Tops Y / N Analysis Y / N Received? • Comments: X p -e_ CV's UI^ Compliance Reviewed By: Date: w �— • From: Saltmarsh, Arthur C (DOA) Sent: Monday, March 09, 2009 11:08 AM To: Maunder, Thomas E (DOA); Seamount, Dan T (DOA); Davies, Stephen F (DOA); Roby, David S (DOA); McMains, Stephen E (DOA); Williamson, Mary 3 (DOA); Regg, James B (DOA); Fleckenstein, Robert J (DOA); Colombie, Jody J (DOA); Gary Carlson; Norman, John K (DOA); Foerster, Catherine P (DOA); Laasch, Linda K (DOA); Iongmer&verizon.net Subject: FW: Pacific Energy files chapter -11, it's official!!! FYI. PACIFIC ENERGY RESOURCES LTD. 111 West Ocean Blvd., Suite 1240 Long Beach, California 90802 Telephone: (562) 628 -1526; Fax: (562) 628 -1536 Files for Chapter 11 to Facilitate a Restructuring LONG BEACH, CALIFORNIA, Monday, March 9, 2009 - - Pacific Energy Resources Ltd. (the "Company ")(TSX:PFE) announces today that it and its wholly owned subsidiaries have filed voluntary petitions for reorganization under Chapter 11 of the U.S. Bankruptcy Code in the U.S. Bankruptcy Court for the District of Delaware. The filing was precipitated by the dramatic decrease in the market price of oil over the past five months. Combined with the Company's pre- existing level of debt related to past acquisitions and poor capital market conditions, the Company's liquidity and cash flow is insufficient to operate its business and invest in its oil producing assets to increase production. Faced with these constraints, the Company and its subsidiaries filed petitions for reorganization under chapter 11 to facilitate access to an immediate source of liquidity as it works to restructure its debt. In connection with the filing, the Company is seeking customary authority from the Bankruptcy Court that will enable it to continue operating its business in the ordinary course of business. The requested approvals include requests for the authority to make wage and salary payments and continue various benefits for employees. In addition, the Company has negotiated a commitment for $40 million in debtor -in- possession ( "DIP ") financing. The DIP facility wraps and replaces two of the Company's three asset -based credit facilities and is being provided by the lenders of the two credit facilities that are being replaced. Upon Court approval, the DIP financing combined with the Company's operating revenue will provide sufficient liquidity to fund working capital, meet ongoing obligations and ensure that normal operations continue without interruption during its restructuring. About Pacific Energy Resources Pacific Energy Resources Ltd. is an oil and gas exploration and production company based in Long Beach, California, U.S.A. Additional information relating to the Company may be found on SEDAR at www.sedar.com. The Company's web site is www.PacEnergy.com. ON BEHALF OF THE BOARD OF DIRECTORS PACIFIC ENERGY RESOURCES LTD. so Pacific Energy Resources Ltd. David Hall 310 K. Street, Suite 700 Alaska Operations Manager Anchorage, AK 99507 Main: 907 - 868 -2133 Office: 907 - 258 -8600 Cell: 907 - 317 -8239 Fax: 907 - 258 -8601 dmhall@nacenergy.com www.pacenergy.com • • SARAH PALIN, GOVERNOR ■T ALASKA OIL AND GAS �% 333 W 7th AVENUE, SUfTE 100 CONSERVATION COMMiSSIO.It ANCHORAGE, ALASKA 99501 -3539 PHONE (907) 279 -1433 FAX (907) 276 -7542 Bruce Webb, Agent Pacific Energy Resources, Ltd. 111 Ocean Blvd., Suite 1240 Long Beach, CA 90802 Re: Exploration Well, N. Alexander No. 1 Pacific Energy Resources, Ltd Permit No: 207 -169 Surface Location: 2500' FNL, 625' FWL, SEC. 22, T15N, R8W, SM Bottomhole Location: 2500' FNL, 625' FWL, SEC. 22, T15N, R8W, SM Dear Mr. Webb: Enclosed is the approved application for permit to drill the above referenced exploration 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. The permit is approved subject to full compliance with 20 AAC 25.055. Approval to perforate and produce is contingent upon issuance of a conservation order approving a spacing exception. Pacific Energy Resources, LTD. assumes the liability of any protest to the spacing exception that may occur. 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. A mudlog is required for this exploratory well. Cuttings samples are not required. At a minimum, openhole gamma ray, resistivity, and sonic or density porosity logs must be recorded from the base of conductor pipe to total depth of the well. If formation testing is planned, a Sundry Notice (Form 403) must be submitted in advance of the operations. Since the calculated surface pressure exceeds 3000 psi, at a minimum the BOP stack, choke manifold and all associated piping must be rated API 5K. PaCIFIC Energy Resourcestd. • N. Alexander #1 Permit: 207 -169 When rig -up operations have been completed and in advance of spud, you should contact Mr. Jim Regg at 907 - 793 -1236 so that arrangements can be made to conduct a rig inspection. Operations must be conducted in accordance with AS 31.05 and Title 20, Chapter 25 of the Alaska Administrative Code unless the Commission specifically authorizes a variance. Failure to comply with an applicable provision of AS 31.05, Title 20, Chapter 25 of the Alaska Administrative Code, or a Commission order, or the terms and conditions of this permit may result in the revocation or suspension of the permit. When providing notice for a representative of the Commission to witness any required test, contact the Commission's petroleum field inspector at least 48 hours in advance at (907) 659 -3607 (pager). Sincerely, Z ' , ,, . ) , r.,, ,7' . Daniel T. Seamount, Jr. Chair -f-h DATED this 23 day of March, 2008 cc: Department of Fish & Game, Habitat Section w/o encl. Department of Environmental Conservation w/o encl. RECEIVED STATE OF ALASKA ALA. OIL AND GAS CONSERVATION C M ION MAR 2 7 2008 PERMIT TO DRILL f 3 20 AAC 25.005 Alaska Oil & Gas Cons. Commission 1a. Type of Work: 1b. Current Well Class: Exploratory 151 Development Oil ❑ 1c. Specify if well i g: Drill El Redrill ❑ Stratigraphic Test ❑ Service ❑ Development Gas ❑ Coalbed Methane ❑ Gas Hydrates ❑ Re -entry ❑ Multiple Zone ❑ Single Zone ❑ Shale Gas ❑ 2. Operator Name: 5. Bond: i p Blan ( k � et in Ie�Wel 11. Well Name and Number: Pacific Energy Resources, Ltd. Bond No. ' o B be fumishdrpror io '‘ . ling North Alexander No. 1 3. Address: 6. Proposed Depth: 12. Field /Pool(s)rj VD 111 Ocean Blvd., Suite 1240, Long Beach, CA 90802 MD: - 8,500 TVD: . 8,500 undefined �� 3.274% 4a. Location of Well (Governmental Section): 7. Property Designation: Beluga Form and Surface: 625'FWL 2,500' FNL Sec 22 T15N R8W SM ADL 390586 Upper Tyonek Formation Top of Productive Horizon: 1P 1t 8. Land Use Permit: 13. Approximate Spud Date: 625'FWL 2,500' FNL Sec 22 T15N R8W SM None 2/15/2009 Total Depth: 9. Acres in Property: S''"y ,''" p 14. Distance to Nearest 625'FWL 2,500' FNL Sec 22 T15N R8W SM —640 .2?• ° 15 Property: 625' FWL 4b. Location of Well (State Base Plane Coordinates): 10. KB Elevation 15. Distance to Nearest Well Surface: ,X-r2695550.331 „0)(1517296.655 Zone- 4 (Height above GL): 16' feet Within Pool: none 16. Deviated wells: Kickoff depth: 0 feet 17. Maximum Anticipated Pressures in psig (see 20 AAC 25.035) Maximum Hole Angle: 0 degrees Downhole: - 4,156 psi Surface: 3,315 psi 18. Casing Program: Specifications Top - Setting Depth - Bottom Cement Quantity, c.f. or sacks Hole Casing Weight Grade Coupling Length MD TVD MD TVD (including stage data) Drilled 13 -3/8" 72# N -80 BW 80' 16' 16' 96' 96' N/A 11 -1/2" 9 -5/8" 40# N -80 LTC 2,500' 16' 16' 2,516' , 2,516' 747 sx 8 -1/2" 7" 23# N -80 LTC 8,500' 16' 16' 8,516' 8,516' Stage 1 - 829 sx Stage 2 - 1,504 sx 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 a � ?, �o BOP Sketch❑ Drilling Program Time v. Depth Plot 0 Shallow Hazard Analysis ❑ Property Plat Ell Diverter Sketch❑ Seabed Report ❑ Drilling Fluid Program 0 20 AAC 25.050 requirements ❑ 21. Verbal Approval: Commission Representative: Date 22. I hereby certify that the foregoing is true and correct. Contact Printed Name Bruce D. Webb, Webb Petroleum Services Title Agent for Pacific Energy Resources, Ltd i�,. €� Signature 1V , t ti Vy Phone (907) 229 -8398 Date 3/27/2008 r�- Commission Use Only Permit to Drill API Number: Q ,,((,,�� Permit Approval See cover letter for other , Number: 07- / � % 50- i - ZD/ 23 "".! Date: 3/ - /v tf requirements. Conditions of approval : If box is checked, well may not be used to explore for, test, or produce coalbed methane, gas hydrates, or gas contained in shales: Rf' Other: . 9 � Samples req'd: Yes ❑ No V Mud log req'd: Yes[ No �' �° �`\ `'� H measures: Yes No l?" Directional svyreq' Yes No 3500 R5 k N � o. r o c\'Z 3 c,. sc tvc .e 1at,c/inde t rk, ,SKY■ u.c /z =.2.7.41.60 .., y` APPROVED BY THE COMMISSION ze / 1 62/ D ATE: , COMMISSIONER F rm 10-401 Revised 12/2005 ORIGINAL Submit ,mi in Duplicate AA - ( • • S • Oil & Gas Development November 15, 2007 Mr. John Norman, Chair Alaska Oil and Gas Conservation Commission 333 West 7 Ave., Suite 100 Anchorage, Alaska 99501 RE: Application for Permit to Drill: North Alexander #1 Dear Mr. Norman: Escopeta Oil Company, LLC hereby applies for a Permit to Drill for an onshore gas exploration well in the North Alexander Unit about 6 miles north of the Lewis River Unit area on the west side of the Cook Inlet. The well is planned as a straight -hole, targeting the Beluga and Upper Tyonek formations. The rig to be used is the AWS #1. The rig's well control systems are on file with the Commission. Please find attached information as required by 20 AAC 25.005 (a) and (c) for your review. Pertinent information attached to this application includes the following: 1) Form 10 -401 Application for Permit to Drill. a. 3) A plat showing the surface location of the well. 4) Proposed summary drilling program. 5) Proposed drilling fluid program. 6) Proposed casing program. 7) Proposed cementing program. 8) Summary of Drilling Hazards. 9) A Time versus Depth plot. 10) Schematic of the proposed wellbore and completion. 11) Escopeta does not anticipate the presence of H2S in the formation to be encountered in this well. However, H2S monitoring equipment will be functioning on the rig at all times during drilling and completion operations. 12) The following is Escopeta's designated contact for all reporting responsibilities to the Commission (20 AAC 25.070 and 071): RECEIVED Danny S. Davis, President (713) 623 -2219 NOV 1 6 2007 Alaska Oil & Ga C �as.�r� ORIGINAL A thotdge 5005 Riverway, Suite 440 • Houston, Texas 77056 • Office: 713.623.2219 • Fax 713.439.1205 • E -mail: escopeta @swbell.net At is Mr. John Norman Page 2 Escopeta respectfully requests a waiver of 20 AAC 25.025(a) for the submission of a bond at this time. Under the Unit Plan of Exploration approved by the Department of Natural Resources, all permits are required to be in -place by December 31, 2007. It is unlikely that the N. Alexander #1 well will be drilled this winter exploration season. Therefore, no activity on the lease or the subject well will occur for approximately one year. Escopeta proposes that the Commission allow the submission of a bond, or other financial instrument, acceptable to the Commission within thirty (30) days prior to drilling activities. If you have any questions or require additional information, please contact Mr. Danny Davis at (713) 623 -2219. Sincerely, Bruce D. Webb Webb Petroleum Services Agent for Escopeta Oil Company, LLC enclosures w.rsv low • V a...snr r STATE OF ALASKA NOV 1 r 2007 ALAI, OIL AND GAS CONSERVATION COMIAION Alaska Oil & s Cons. C;a ' «' ,, PERMIT TO DRILL A missio 20 AAC 25.005 554 • ncharaue 1 a. Type of Work: b. Current Well Class: Exploratory 0 Development Oil ❑ 1 c. Specify if well is p • osed for: Drill 0 Redrill ❑ Stratigraphic Test ❑ Service ❑ Development Gas ❑ Coalbed Metha r ❑ Gas Hydrates ❑ Re -entry Multiple Zone ❑ Single Zone ❑ ; le Gas ❑ 2. Operator Name: '7a a..j . t... E;Ker 0.4gcw o 4 411. . 5. Bond_ ago. i,pgle W- p 11. Well Name and Number: Escopet 3 pany, LLC "� V .� ' Bond N Qto a e . • -1 D . . . North Alexander No. 1 3. Address: /// ka 4 /4,4 $ ,,:.t /276 6. Proposed Depth: 12. Field /Pool(s):4, o 5005 Riverwa , Houston, TX 77056 . d .t 4, c.f MD: 8,500 ` T ': 8,500 ' e 49 �y �• 4a. Location of Well G vernm ntal Section Property Designation: Beluga Formation n (v7 ) : /f 3 - 2 L ��l5 7. Pro Surface: 625WC 2,00' FNL Sec 22 T15N R8W SM ADL 39' :6 ' Upper Tyonek Formation ' To p 1}; of Productiv orizo • 07 8. Land Use Permit: 13. Approximate Spud Date: 62 W 2,500'' FNL Sec 22 T15N R8W SM one 2/15/2008 Total Depth: ci, , /i• (P.a.? 9. Acres in Prope ip 14. Distance to Nearest 625' FWL 2,500' FNL Sec 22 T15N R8W SM .. „64O 5'444) iv `.b Property: 625' FWL / 4b. Location of Well (State Base Plane Coordinates): 10. KB Elevati. 15. Distance to Nearest Well Surface: x- 2695550.331 y- 1517296.655 Zone- 4 (Height abov- L): 16' feet Within Pool: none 16. Deviated wells: Kickoff depth: 0 feet ' 17. Maxi Anticipated Pressures in psig (see 20 AAC 25.035) Maximum Hole Angle: 0 degrees Downh. : 4,156 psi , Surface: 3,315 psi 18. Casing Program: Specifications Top - Setting Depth - Bottom Cement Quantity, c.f. or sacks Hole Casing Weight Grade Coupling Length D TVD MD TVD (including stage data) Drilled 13 -3/8" 72# N -80 BW 80' 16' 16' ' 96' 96' ' N/A 11 -1/2" 9 -5/8" 40# N -80 LTC 2,500' 16' 16' 2,516'- 2,516' ' 747 sx 8 -1/2" 7" 23# N -80 LTC 8,50► 16' 16' 8,516' 8,516' Stage 1 - 829 sx Stage 2 - 1,504 sx 19. PRESENT WELL CONDITION SUMM '.'Y (To be completed for Redrill and Re -Entry Operations) Total Depth MD (ft): Total Depth TVD (ft): Plugs easured): Effect. Depth MD (ft): Effect. Depth TVD (ft): Junk (measured): Casing Length Size 40 Ce , nt Volume MD TVD Conductor /Structural - Surface l Intermediate � 4 D I►' Production Liner f t/ Perforation Depth MD (ft): Perforation Depth TVD (ft): 20. Attachments: Filing Fee A ,',}fir --- BOP Sketch/ Drilling Program 0 Time v. Depth Plot Ei Shallow Hazard Analysis ❑ Property Pl. El Diverter Sketc r / Seabed Report ❑ Drilling Fluid Program 0 20 AAC 25.050 requirements ❑ 21. Verbal Approval: Commission -presentative: Date 22. I hereby certify that the forego' • is true and correct. Contact Printed Name ny ' Title President Signature /4 Phone 713 - 623 -2219 Date 14- Nov -07 / Commission Use Only Permit to Drill / A PI Number: � .� 2 Permit Approval See cover letter for other Number: I� — cog 50- Z4S3 - (2-.7 Date: requirements. Conditions of a : If box is checked, well may not be used to explore for, test, or produce coalbed methane, gas hydrates, or gas contained in shales: Other:5O .4 0 i A .),` % O� s � Samples req'd: Yes 111 No [� Mud log req'd: Yes[✓ No c� _ \ `J L-� -` ` H Yes No T M Directional svy req'd: NoV 2z z v 4 7 �,Qc.c�.o$4.. vi vc c�� — S,�u) . 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L - 1.— I a # # ii ,+ sa4 # 'I Kit #, 3 4 # , , # I t ���/11 — #4 ,' + i, 4 i } 4* *,+I , . ; ,. � 4 y 4 F r4 !�� + �4 r r4 • # -- : #� i 4 } 1,'4. t fi 4 4 � It4 . • n� ti 4°48' 4 r ,1 , 4 'I # 4 # 4 1 1( #,4 4 E ° o o i - x 4 4 # 0 4 • $ !Pt nt # ^ ° e s , 4.1014, t I ' ' ',\I, '' 4 444 � I '+#. # 4 kilt' C #f 1 .+m4 4 i 44 I ” - r te. t. } 4; � 4 a �e o 4. *.� } I ' ''' ? f' '41 O V •_. a Z V • ti H ''N 4 1 a N 000 t'Z t9 N ,000'C0 T9 N 000'00 19 N 000'10 19 N ,000'0? t9 N ,000' 61oT9 N 000'#1019 N ,000'LToT9 N ,000'9ToT9 N ,000'ST oT9 LAND AND MINERAL ESTATE OWNERSHIP ' FIGURE 3: NORTH AL EXANDER IleSPECT LEASES and RIGHTS OF WAY 1 ,, :fillir i ly "rat • t i i .4* iiir_ ,,,...„,,.... de .. .. , a ENSTAR Pipeline ADL 389935 .• ADL 389213 t Tract 1 Tract 2 �'�' . iii iiii...„.: - DOT EASEMENT ROW Proposed Well Location -- . • dilli" ADL 89212 T pct 4 " ADL 390586 Temporary Tract 3 Ice R od \ _ 1 tit; Lewis River \ • I Unit area ' CEA Powerline ROW fi , . , t R , . / e e Gravel Roads Stump Lake Unit and Ivan River Unit areas COOK INLET idi — $ ,. O 0 1 .5 3 4.5 6 ""` ` • -' • NORTH "'■'" Miles 1 IIIN I I i I I • -6 - j SCALE I 0 1000 2000 I I i 1 I I FEET I I SECTION 16 I PROTRACTED SECTION CORNER ADL 389935 GRID N. .2698056.821 SECTION 15 GRID E:1516695.268 Escopeta Oil LATITUDE 61'22'58.531 "N ADL 389913 Company, LLC 16 15 LONGITUDE' 150'42'19.948 "W Escopeto Oil Company, LLC 15 14 21 22 22 { 23 / V z SECTION 22, T15N, R8W, ' - ``!; S.M., ALASKA i - I • N ADL 390586 / Escopeta Oil Company, LLC ....- • 1 m PROPOSED SURFACE LOCATION CC NORTH ALEXANDER NO. 1 •- II GRID N: 2695550.331 T GRID E:1517296.655 LATITUDE 6172'33.914'N • - - N 2 2 LONGITUDE: 150'42'07.050 "W Z p w ELEV. 55 /' • a) FM = 625' FWL 2151 a ' to Q d F, G F S - �tYJGp•- '� - 1) SURFACE LOCATION COORDINATES COMPUTED FROM SECTION LINE ` OFFSETS DERIVED BY PROTRACTED SECTION CORNER VALUES AND REPORTED IN NAD83 ASP ZONE 4 2) ELEVATION SCALED FROM USGS QUADRANGLE AND REPORTED IN NAVD8B- 3) SECTION LINE OFFSETS DERIVED FROM TIES TO PROTRACTD CORNERS OF SECTION 22 T15N R8W ACCORDING TO THE BLM PROTRACTION - DIAGRAM. • 4 ORTHOPHOTO SOURCE GOGGLE MAP 2006 -`''Y • . . NOTES f# ' 'i , 21 22 sw '- 22 23 28 1 27 27 26 PROJECT LOCATION REVISION- NO. NORTH ALEXANDER NO. 1 WELL DA os iz vz oo7 PROPOSED S22, T15N, R DRAWN BY MSM SURFACE LOCATION DIAGRAM SEWARD MERIDIAN, ALASKA SCALE. 1" =1000' • C 9 PROJECT NO. 073127 BOOK NO. leraolliella ' 5005 Riverway, Suite 440 oF- - � "G - �� "F �^�-^"a SHEET samTMa.uc BMW OF 1 Houston, Texas 77056 — MO- 028.210 FAX(MD] - II Escopeta Oil Company, LLC North Alexander No. 1 Drilling Program North Alexander No. 1 North Alexander No. 1 is a grass -roots straight -hole well that will target the Beluga and Upper 1 Tyonek formations. A spacing exemption will be required due to the proximity of the well to the adjacent oil and gas lease. It is proposed to be located in the North Alexander Unit approximately 6 miles north of the Lewis River Unit area. Pre Rig work 1. Stake & survey the North Alexander No. 1 well site. 2. Construct a 200' x 300' pad configured for AWS #1 with drilling support. Build sufficient cuttings containment for planned drilling program. 3. Install 13 -38" conductor to 80' below ground level. Install cellar & mousehole. Cut off conductor as needed to accommodate diverter system. Drilling Procedure 1. File & insure all necessary permits and applications are in place. 2. MIRU AWS #1 in drilling configuration. 13 -3/8" conductor has been pre - installed. Install 13 -5/8" VG LOK head. 3. Rig up diverter & mud loggers. Test & calibrate all PVT / gas sensor equipment. Provide )hr o� to AOGCC inspectors for chance to witness diverter test. 4. NI f AOGCC & pertinent agencies when ready to start drilling operations. 5. Prepare spud mud system / weight up to —9.5 ppg. Load, strap & drift 2,500' off 9 -5/8" surface casing. 6. PU 11 -1/2" mill tooth bit & drill to 2,550', using 6 -1/4" stabilized BHA. Watch for gas ' in shallow coals and sands. Attempt to TD in siltstone or claystone, avoid setting surface shoe in a coal bed or sand. If possible, adjust TD to put cement head at floor. 7. Condition hole for running 9 -5/8" surface casing, POOH, LD 11 -1/2" BHA. 8. Run & cement new 9 -5/8" 40 #, N -80 LTC casing @ 2,500', installing 1 centralizer / joint centered on the 1 4 joints above shoe, & 1 centralizer every 2nd joint across the collars there after. Shoe joint connection at float shoe and float collar must be Baker - Locked. Cementing will be single stage using 14.5 ppg gas-block enhanced Type I cement at 100% excess volume. Be prepared to treat cement returns with retarder++nM i? 7 9. RD cementers, nipple down diverter, cut casing and install 12 -1/2" 34,�vellhead. 10. RU and test I2=-11 2 stack and 5M choke manifold. Test stack and surface equipment to 3)6Q psi. Pressure test 9 -5/8" casing to 1 si for 15 minutes or as required on approved Permit to Drill. rk a Soo , L`� j�� sooO . ��.\ . \� v .p 3 0 Prepared by Webb Petroleum Services Page 1 of 11 S�Cc vr -• )6 �y r Escopeta Oil Company, LLC� • North Alexander No. 1 Drilling Program 11. PU 8 -1/2" Mill Tooth Bit & RIH w/ 5 -1/2" collars with 2 -7/8" drill string. Drill out shoetrack. Condition / treat mud as needed for cement contamination, drill 20' new formation. Pull back into shoe & perform FIT / LOT to 14.5 ppg EMW with low volume test pump. Record results. `` Cn. ate, tir`S�1-a��E�� ��Cc � 's" 9300 � �� 12. Install 2 -7/8" pipe rams and test to 1500 psi or as required by PTD. Notify AOGCC 24 )19 hrs. prior for witness of test. 13. Continue to drill 8 -1/2" hole to —8,500' MD (8,500' TVD) TD per drilling plan, or other as directed by Escopeta geologist. Increase MW to 10.2 prior to reaching 3,000'. Monitor well and volumes carefully. Be prepared to shut well in and weight up immediately if flow or excessive gas build up in mud is noticed. Monitor hole cleaning and drilling trends, prepare to short trip if needed. Anticipated mud weights required are 10.0 ppg 10.2 ppg. Do not exceed fracture gradient determined in step 11. If possible, adjust TD to put cement head on floor. While drilling, load, tally & drift 7" casing on racks. 14. Condition hole, short trip and prepare for running wireline logs. 15. POOH, rack back drillstring and RU wireline BOP's and lubricator and logging tools. Log 9 -5/8" cased hole section w /gamma ray sensor, Log OH section with logging suite including resistivity and porosity logs as directed by Aurora Gas. RD wireline. 16. RIH w/ 8 -1/2" drilling assembly to TD & condition hole for running 7" casing. Ensure cementing head has proper connections or proper cross -over and is available for quick rig up. 17. POOH while laying down drillpipe & BHA, RU to run casing. Verify cementer's equipment is ready. 3sDC7 ps 18. Install 7" pipe rams & test to 1„.54A psi. Notify AOGCC 24 hrs. prior for witness of test. 19. Run 7" 23# N -80, LTC casing installing 1 bowspring centralizer per joint centered on 1st 4 joints above shoe, a combination of rigid blade & bow spring centralizers in open hole & a bowspring every 3'' joint inside surface casing. Shoe joint connection at float shoe, float collar & stage tool landing collar must be Baker - Locked (80'shoetrack). While running casing, fill every 3` joint. Be prepared to wash to bottom. 20. RU cementers, cement per attached cementing program from TD to surface. The job will be conducted in 2 stages with an ES cementing stage tool @ 2,500'MD. Stage 1 will pump sufficient volume of 15.8 ppg Class G tail slurry to cover 7" x 8 -1/2" annulus to 2000'. See attached cementing info for preliminary volume estimates. While pumping 'cement, reciprocate pipe a minimum of 20' until cement goes around the shoe. Land casing within 1 - 5 ft of bottom if possible. Displacement will be with mud. When displacement is fmished, bump plug & open the stage tool by pressuring up casing to 2,750 psi. Upon opening the stage tool circulate any cement that is above 2,500' out of well & condition mud. Stage 2 will consist of sufficient volume of 13.5 ppg Class G lead cement to cover the shoe @ 2,500' to surface followed by sufficient volume of 15.8 ppg Class G cement to bring evidence of lead cement to surface. At that point the closing plug will be dropped and displaced with mud. Be prepared to get back 50 bbl of cement to shakers. Bump closing plug w/ 1, 100 psi over circulating pressure. Hold for 5 minutes, Prepared by Webb Petroleum Services Page 2 of I 1 Escopeta Oil Company, LLC North Alexander No. 1 Drilling Program bleed off, confirm that ES cementer is closed and holding, drain & wash down stack, check annulus for flow, center casing w/ annular preventer, clean out flowline & WOC. 21. RD cementers, nipple down stack, land casing in slips & cut casing. 22. Install 11" X 7- 1/16" tubing spool, 7- 1/16" X 11" DSA, mud cross and reinstall BOP stack. Pressure test BOP and surface equipment to 3,psi. Pressure test casing to 2,000 psi for 15 minutes and record results. 3SO ';, 23. Install 2 -7/8" pipe rams and test to INS psi or as required by PTD. Notify AOGCC X hrs. prior for witness of test. LC/ 24. RIH w/ bit & casing scraper on 2 -7/8" tubing to float collar. Displace well w/ filtered KC1/NaCI brine (wt. to be determined from MDT data). Continue to clean brine for perforating by running through centrifuge & filtering. POOH. Strap tubing on TOH to validate tally. j 4 p i 25. PU wireline BOP's & lubricator, pressure test all. PU GR/CBL /CCL & log 7" casing to 7' surface. LD logging tools & PU perforating guns, R1H to depth as determined from OH b 4 , °� logs and perforate zones of interest. Watch for pressures in casing after shooting. v I' POOH, LD perf gun, RD wireline. 26. RIH w/ bit & casing scraper on 2 -7/8" tubing to float collar. Circulate perforating debris from hole. Continue centrifuging & filtering brine until cleaned up. POOH. LD bit & scraper. 27. RU & RIH with test packer assembly on workstring. Connect to surface flow test equipment. RU & swab in well for flow test, record results. Kill well. 28. Repeat step 27 until all zones of interest have been evaluated for production. 29. POOH. Pull slowly to avoid swabbing in well with packer. 30. Pick up & assemble completion assembly which will use retrievable type packers, sand exclusion screens, sliding sleeves and other jewelry as necessary. Exact configuration to be determined by test results. Please see attached proposed completion scenario. Packer is to be 60' minimum above upper -most screen. RIH with completion & set completion at appropriate depth. POOH. 31. RIH with new 2 -7/8" 6.5# EUE 8rd production tubing, hydraulic set retrievable packers & seal assembly, space out & stab into packer PBR, hang off in tubing head & lock down. Install blanking plug in profile nipple at bottom of tubing. Pressure up tubing & set packers. Pressure test tubing to 2,000 psi, pull blanking plug. 32. RU & swab in well. After well cleans up perform 4 -point test. Shut in well & record pressure buildup until stabilized with no change in one hour. 33. Install BPV, nipple down & remove BOP stack. Install production tree. Tear down & remove all rig equipment. 34. Clear & clean location. Hand well over to production. 35. File completion reports with proper agencies. Prepared by Webb Petroleum Services Page 3 of 11 Escopeta Oil Company, LLC North Alexander No. 1 Drilling Program Site Access The North Alexander well site will be accessible via ice road to the Beluga area. Rig Aurora Well Service, Rig No. 1 (AWS 1) will be used to drill the N. Alexander #1 well. The Alaska Oil & Gas Conservation Commission has information on this rig and equipment as it has been in use for the last (5) years on other Aurora Gas operations. The pits, BOP system & mud equipment configuration will be the same as that used for previous work. Survey Program The 11 -1/2" surface hole and the 8 -1/2" production hole will be drilled vertically and the survey program will consist of inclination only single -shot surveys to be obtained at 500' intervals in accordance with rules laid out in 20 AAC 25.050 (a) (1) & (2). ri. 07 fr Logging Program Mud loggers will be on site for the duration of drilling activities. ./ Schlumberger will provide wireline logging services as proposed below: North Alexander #1 Proposed Logging Program �`''`� �i��444,5:::(143 Well Section Depths (ft) OH CH Log Type 11 -1/2" Surface 0' — 2,500' 4 N /A: No open -hole logs planned for surface at this time. /1.►+ -Gu GR only in cased hole. 8-1/2" Production 0' — 8,500' Platform Express: Array Induction, Compensated Neutron, p � , Hole Litho - Density, SP, GR, and possibly DSI and/or FMI. Also w ` • 0 7 MDT and Sidewall cores. 7" Casing 0' — 8,500' "J GR/CBL /CCL Surface — TD 0' — 8,500' Mud Logging Services BOP Equipment 5E cc \ S000 Escopeta Oil Company, LLC will be using a similiar BOP system as Aurora Gas, LLC / Aurora Well Service has been using for the last (5) years which will consist of the following: 11 - 1/2" Surface Hole While drilling the 11 -1/2" surface hole, a 12 -1/2" 3M annular w/ 13 -5/8" diverter spool & 12" diverter line will be used as per 20 AAC 25.035 (c)(1)(A) requiring that the diverter line outlet size be at least 16" diameter or (B) at least as large as the hole size being drilled. Prepared by Webb Petroleum Services Page 4 of 11 • • Escopeta Oil Company, LLC North Alexander No. 1 Drilling Program 8 -1/2" Production Hole SOO 0 r--;1/4 t �`� `'`C�. S e e , ` An 11" 3000 PSI WP Schafco (Shaffer Equivalent) BOP system will be used which is configured with an 11" 3000 PSI WP annular preventer, (1) 3000 PSI WP double gate with a set of pipe rams installed sized to fit the pipe being run and a set of blind rams and (1) 11" 3000 PSI WP rated drilling spool. BOP tests will be performed to 3000 psi. The annular preventer will be tested to 1500 psi. Drilling Fluids The drilling fluids will be furnished by Baroid Drilling Fluids who has extensive experience with drilling activities in this area. An experienced mud engineer will be on site at all times while drilling to monitor properties and make recommendations. Drilling Fluid Properties While Drilling 11 -1/2" interval to 2,500' Beluga Formation Base Fluid 6% KCL Density 9.5 —10 ppg PV 22 — 30 YP 20 -30 API Filtrate < 5 Total Solids 15 — 25 % Gel & Polymer mud system Drilling Fluid Properties While Drilling 8 -1/2" interval to 8,500' Beluga and Tyonek Formations Base Fluid 6% KCL Density 10.0 —10.5 ppg PV 22 — 30 YP 20 -30 API Filtrate < 5 Total Solids 10 —15 % Polymer mud system Drilling Fluid Handling System Shale Shaker, Mud Cleaner, Centrifuge, PVT monitors Drilling Waste Disposal The cuttings will be rockwashed for use on existing roads and pads. Drilling mud will be held in tanks for reuse or transfer, treatment and disposal at the Kenai Peninsula Borough Landfill. Brine will be placed in tanks for use in future wells. Prepared by Webb Petroleum Services Page 5 of 11 " r Escopeta Oil Company, LLC • North Alexander No. 1 Drilling Program Casing / Cementing Program All casing is new. Analysis (attached) indicates casing program as designed provides adequate safety factors for this well. All casing strings with the exception of the 13 -3/8" conductor will be cemented in place using industry standard casing cementing techniques utilizing a casing shoe, float equipment, top and bottom wiper plugs and centralizers installed as needed. 13 - 3/8" 72# N - 80 Conductor Analysis and Cementing Program The conductor for N. Alexander #1 will be installed by drilling/driving. The 13 -3/8" pipe to 80'SS /96'RKB. Joints will welded together and a drilling shoe will be welded to the bottom joint. No cementing is required. 9 - 5/8" 40# N LTC Surface Casing Analysis and Cementing Program The 9 -5/8" surface casing will be cemented from the proposed setting depth of 2,500' to surface with a 14.5 ppg Type I, gas block enhanced cement system. Capacities: 9 -5/8" Csg. Capacity = .0758 bbl/ft 9 -5/8" Csg. x 11 -1/2" OH Capacity= .0385 bbl /ft System Volume: 11 -1/2" OH x 9 -5/8" Csg: 2,500' x .0385 bbl/ft x 2 (100 % excess) =192.5 bbls Shoe Jt: 40' x .0758 bbl/ft = 3.1 bbls Actual volumes to be re- calculated at time of running casing due to potential variation in actual depth from planned. The surface cement system utilizes a Gas-Block type additive to minimize potential for gas entrainment or channeling. Cement System Weight (ppg) bbl ,j cf / sx Gas -Block enhanced Type I 14.5 195.6 1,098.2 747 Yield 1.47 clYsx Please see attached 9 -5/8" surface casing analysis and specifications. 7" 23# N-80 LTC Production Casing Cementing Program The 7" production casing will be cemented from the proposed set depth of 8,500' MD to surface. This will be done in 2 stages with the 1 stage consisting 15.8 ppg Class G tail cement covering from TD to 2,500'MD. Stage 2 will consist of a 13.5 ppg Class G lead slurry followed with 15.8 ppg Class G tail slurry. This program is designed to insure the intended perforating / production intervals are isolated with 15.8 ppg Class G cement. Prepared by Webb Petroleum Services Page 6 of 11 Escopeta Oil Company, LLC • North Alexander No. 1 Drilling Program Capacities: 7" 23# csg capacity = .0394 bbl/ft / 7" 23# csg X 8 -1/2" OH capacity = .0226 bbl/ft 7" 23# csg X 9 -5/8" 40# annular capacity = .0282 bbl /ft Stage 1: Tail System: 8 -1/2" OH x 7" Csg: 8,500' — 2,500' = 6,000' v 6,000' x .0226 bbl/ft x 1.25 (25% excess) =169.5 bbls Shoe Joint = 80' x .0394 bbl/ft = 3.2 bbls Total Tail Cement Volume = 172.7 bbls Stage 2: ��, \ �N c�Q o Lead System: SY O ca- — Sistg 9 -5/8" CH x 7 "Csg: = 2,500' �� 2,500' x .0282 bbls/ft x 1 (0% excess) = 70.5 bbls < � < (0 ) � Total Lead Cement Volume = 70.5 bbls ``�- Tail System:te 4S 8 -1/2" OH x 7' Csg: 8,500' — 2,500' — 6,000' •,ill'x.l • I ._ oexcess) — ;' .t s ---P 7" Csg: = 2,500' x .0394 bbl/ft = 98.5 bbls 4--- Total Tail Cement Volume = 268 bbls Stage 2 tail volume is estimation only. Tail cement will be pumped until evidence of lead is at surface. Only at that point will the wiper plug be dropped and cement displaced. Cement System Type Cement Weight (ppg) bbl cf sx Lead @ 1.83 cf/sx G 13.5 70.5 396 - 217 Tail @ 1.17 cf/sx G 15.8 440.7 2,475 2,116 Please see attached 7" production casing analysis and specifications. Pressure Calculations 1 /11(4.'' L). , ,s '' Maximum Anticipated Surface Pressure r l' � � i t°- anticipated pressure gradient data of .49 is used for the Tyonek sands. Calculating from this data, our maximum anticipated bottom -hole pressures should not exceed 4,165 psi at 8,500'MD (8,500'TVD). Maximum anticipated surface pressures "MASP" can be calculated by subtracting the gas gradient of .1 psi/ft from pore pressure gradient of .5 'psi / ft and multiplying by the total TVD depth. y Maximum Anticipated Surface Pressure = (.49 - .1) * 8,500' = 3,315 psi Prepared by Webb Petroleum Services Page 7 of 11 Escopeta Oil Company, LLC • North Alexander No. 1 Drilling Program Assuming casing shoe strength of 14.5 ppg EMW (or .754 psi/ft) our estimated Maximum Aikiwable Surface Pressure during the 9 -5/8" interval is expected to be: Maximum Allowable Surface Pressure = (.754 -.1) *2,500' = 1,635 psi Drilling Hazards Shallow gas Shallow gas is a known hazard which exists throughout the area. The northwest side of Cook Inlet is noteworthy for its shallow gas hazard. All responsible personnel will be made aware and " a notice of such hazards will be posted in the rig doghouse. There is no record of H2S in the region, however; a gas detection system capable of detecting H2S as well as methane will be installed on the rig with detectors at the floor level, the shale shaker and in the cellar. Coal Seams The Cook Inlet region is rich in coal seams, inter- bedded between the sands, gravels and shales that make up the Beluga and Tyonek formations. Drilling into a coal seam will appear to be a drilling break when drilled with a tri-cone bit. The major hazard of drilling into a coal seam without observing the proper response is the risk of stuck pipe. The proper course of action for preventing stuck pipe is two -fold. First, prior to drilling, insure the drilling fluid system is up to par, per recommendations from the on -site mud engineer. The second step to successfully drilling through coals in the Cook Inlet area is to not get greedy when coals are encountered. When a coal has been encountered, pull back above coal after drilling into it, and circulate, allowing the coal to stabilize. Re- enter, drill some more, and pull back out again. Continue in this fashion until successfully through the coal bed. The key word in successfully drilling the coal beds is patience. It should be remembered that coals behave plastically, and will flow under the weight of the overburden. The deeper the coal, the more pronounced this tendency becomes. For this reason it is critical to maintain the proper weight and viscosity of the drilling fluid to properly remove the coal cuttings, and to hold flowing coals in place. Again, heed the recommended drilling fluid program and advice offered by the on -site Mud Engineer. Well Proximity Risk There is no close approach risk associated with drilling N. Alexander #1. The nearest well activity lays more than a mile in any direction. Other Risks Sticky bentonitic clays, boulders, lost returns & differential sticking with overbalanced muds and gas influx while cementing or swabbing while tripping pipe. Prepared by Webb Petroleum Services Page 8 of 11 Escopeta Oil Company, LLC • North Alexander No. 1 Drilling Program North Alexander No. 1 Days vs Depth 0 5 10 15 20 25 30 0 500 Drill 11-12" Interval 1,000 1,500 2,000 Run 9-5/8" Casing 2,500 3,000 3,500 a 4 , 000 -0 e 4,500 Drill 8-1/2" Interval I 5,000 2 5,500 6,000 6,500 7,000 7,500 8,000 Log Well, Run 7" Casing, Perforate, Test, 8,500 Run Completion 9,000 1 Days prepared by Webb Petroleum Services Page 9 of 11 Escopeta Oil Company, LLC • P North Alexander No. 1 Drilling Program 2 7/8 6.5# 8rd EUE J -55 Tubing North Alexander #1 . Proposed - 13 -3/8" 72# N-80 Structural Configuration , Conductor to be drilled or driven to 80' 9 -5/8" 40# N -80 Surface Casing set at 2,500' Cement w/ 14.5 ppg Gas -Block Drill 11 -1/2" Hole to 2,500' , 2 -7/8" x 7" annulus to be displaced ..Y over to inhibited packer fluid through sleeve @ -3,380' 'I' Sliding sleeve 1 joint above packer Hydraulic Set Packer @ - 3,380' Hydraulic Set Packer @ - 3,410'MD I Sliding Sleeve @ - 3,470 SECONDARY ZONE OF INTEREST Upper Beluga Perforation Intervals & _.,',= C'..._ Equipment Depths to be determined by open -hole logging. (top @ - 3,500) Hydraulic Set Packer @ - 7.910'MD OR • Sliding Sleeve @ - 7,970' MD PRIMARY ZONE OF INTEREST (a) Lower Beluga Perforation Intervals & Equipment Depths to be determined by open -hole logging. (top @ - 8,000) - "7 2 -7/8" 6.5# EUE 8rd Tubing w/ Seal Assembly to Retrievable Seal Bore 1 Packer @ - 8,310' 2 -7/8" 6.5# EUE 8rd Tubing & Sand PRIMARY ZONE OF INTEREST (b) :•: — Exclusion Screens to - 8,370' MD Upper Tyonek Perforation Intervals & _..,, `} 1= Equipment Depths to be determined by open -hole logging. (top @ - 8,400) - '�'" n • I I= C 7" 23# N-80 Casing to -8,500' MD Estimated PBTD @ 8,460 C 8,500' (TVD) Cemented to surface w/ 13.5 Lead & 15.8 Tail Cement Drill 8 -1/2" Hole to 8,500' Prepared by Webb Petroleum Services Page 10 of 11 Escopeta Oil Company, LLC• • Pe P Y� North Alexander No. 1 Drilling Program North Alexander No. 1 Summary of Drilling Hazards POST THIS NOTICE IN DOGHOUSE Ai There is potential for abnormal pressured shallow gas. ✓ / There is potential for stuck pipe in coals encountered while drilling from surface to TD. Short trips as dictated by drilling trends. Ai There is no H2S risk anticipated for this well. Ai Due to potential for shallow gas kick, very little response time will ✓ be afforded to respond. PVT and gas detection systems must be fully operational and functioning at all times, visual flow checks and pit level monitoring are critical. CONSULT THE NORTH ALEXANDER # 1 WELL PLAN FOR ADDITIONAL INFORMATION Prepared by Webb Petroleum Services Page 11 of 11 3 North Alexander No. 1 Casing Properties and Design Verification Casing Performance Properties: Tensile Strength Internal Collapse Size Weight Yield Resistance TVD MD MW MASP (Inches) lb /ft Grade Cnxn (psi) (psi) Joint Body (ft RKB) (ft RKB) (ppg) BF (psi) 9 -5/8" 40 N -80 LTC 5750 3090 737000 916000 2500 2500 14.5 0.78 1635 7" 23 N -80 LTC 6340 3830 442000 532000 8500 8500 15.8 0.76 3315 Design Safety Factor* • Size Tensile Burst Collapse 9 -5/8" 9.5 3.5 1.9 7" 3.0 1.9 0.6 * Tensile design safety factors are calculated using pipe weight less buoyancy. * Burst design safety factors are calculated at the surface using zero backup on the outside and MASP on the inside. * Collapse design safety factors are calculated at the casing shoe using the maximum expected mud weight to be used at the ❑ shoe depth on the outside and the entire cased hole evacuated except for a gas gradient on the inside. Casing Setting Depth Rationale • 9 -5/8" 2500' MD / 2500' TVD Surface casing to stabilize shallow formations provide an anchor for the BOP stack and provide shoe strength in the event of a kick. 7" 8500' MD / 8500' TVD Production casing to stabilize and isolate producing interval for production operations. Prepared By Webb Petroleum Services page 1 of 1 f ?&C7 t- ■.....''. i 4 • ,— • 01 oil &G. Development March 26, 2008 Mr. Tom Maunder Petroleum Engineer AOGCC 333 W. 7th Ave., Ste. 100 Anchorage, Alaska 99501 Via Email: Tom.maunder@ Re: AOGCC Permit Dear Mr. Maunder: This is authorization that Bruce Webb should receive the AOGCC Permit. Please contact me should further information be needed. Yours truly, t 4 .... _ D.y ` r avis President f.)C 25 River aoy Sui!e 44C • Houston, texas /7056 • 04i:2 . 71 3.623.2219 ox: 77 3.43 1 205 • E -mail: es :ope ar swbell.net Page 1 of 2 • Davies, Stephen F (DOA) From: Bruce D Webb [bwebb c@aurorapower.comj Sent: Thursday, March 27, 2008 1:30 PM To: Darren Katic' Cc: Davies, Stephen F (DOA) Subject: RE: Letter of Incumbency for Webb.pdf - Adobe Acrobat Standard Thank you. If you can send an original to Commissioner Norman at the AOGCC as well, we should be covered. From: Darren Katic [mailto:dkatic @pacenergy.com] Sent: Thursday, March 27, 2008 1:16 PM To: 'Bruce D Webb'; Kevin_Banks; Steve Davies; Tom Maunder Cc: Danny S. Davis; Marino, Anthony C.; Art Copoulos; Gail Ropp; Wolf, Lynn G. Subject: RE: Letter of Incumbency for Webb.pdf - Adobe Acrobat Standard I sent it to Kevin Banks. From: Bruce D Webb [mailto:bwebb@aurorapower.com] Sent: Thursday, March 27, 2008 2:19 PM To: Darren Katic; Kevin_Banks; Steve Davies; Tom Maunder Cc: Danny S. Davis; Marino, Anthony C.; Art Copoulos; Gail Ropp; Wolf, Lynn G. Subject: FW: Letter of Incumbency for Webb.pdf - Adobe Acrobat Standard Darren, Thank you. I have forwarded this off to the appropriate individuals. I understand the originals will be mailed to the addresses on the letter. Thank you for your assistance. -Bruce From: Darren Katic [mailto:dkatic @pacenergy.com] Sent: Thursday, March 27, 2008 1:00 PM To: 'Bruce D Webb' Subject: Letter of Incumbency for Webb.pdf - Adobe Acrobat Standard Let me know if this is all you need. From: Gail Ropp Sent: Thursday, March 27, 2008 1:58 PM To: Darren Katic Subject: Letter of Incumbency for Webb.pdf - Adobe Acrobat Standard Pacific Energy Resources Ltd. 111 W. Ocean Blvd, Ste 1240 Long Beach, CA 90802 Gail Ropp Office: 562- 628 -1526 3/27/2008 I Page 2 of 2 Fax: 562 -62 &1536 • A dministrative • Assistant • ,09 , gropp@pacenergy.com 3/27/2008 • • • 0 ,.,, PACIFIC ENERGY March 27, 2008 Kevin Banks, Acting Director State of Alaska Division of Oil and Gas 550 W. 7 Avenue, Suite 1100 Anchorage, AK 99501-3560 John K. Norman, Chairman State of Alaska Oil and Gas Conservation Commission 333 W. 7 Avenue, Suite 100 Anchorage, AK 99501 Re: Letter of Incumbency for Webb Petroleum Services By Pacific Energy Resources Ltd., as Operator of the North Alexander Unit and the North Alexander No. 1 Exploratory Well Dear Mr. Banks and Mr. Norman: As Designation of Operator for the North Alexander Unit, Pacific Energy Resources Ltd. ( "PERL") hereby appoints Mr. Bruce D. Webb of Webb Petroleum Services, as their agent. Please be advised that PERL grants Mr. Webb the executory powers necessary for the administration of all necessary permitting and regulatory actions required in conjunction with the North Alexander No. 1 exploratory Well. The executory powers granted herein specifically allow Mr. Webb to sign the permit, authorization requests and submittals necessary to obtain the required permits and authorizations for the aforementioned exploratory well only. These executory powers shall be effective immediately and shall remain in full force and effect until revoked by an officer of this company. Should you have any questions, please contact me at the telephone number below. Respectfully Submitted By, c ,r'44 — Darren Katie President 1 Page l of l • Davies, Stephen F (DOA) From: Bruce D Webb [bwebb @aurorapower.comj Sent: Thursday, March 27, 2008 1:19 PM To: 'Darren Katic'; Banks, Kevin R (DNR); Davies, Stephen F (DOA); Maunder, Thomas E (DOA) Cc: Danny S. Davis; Marino, Anthony C.; Copoulos, Arthur E (DNR); 'Gail Ropp'; Wolf, Lynn G. Subject: FW: Letter of Incumbency for Webb.pdf - Adobe Acrobat Standard Attachments: Letter of Incumbency for Webb.pdf Darren, Thank you. I have forwarded this off to the appropriate individuals. I understand the originals will be mailed to the addresses on the letter. Thank you for your assistance. -Bruce From: Darren Katic [mailto:dkatic @pacenergy.com] Sent: Thursday, March 27, 2008 1:00 PM To: 'Bruce D Webb' Subject: Letter of Incumbency for Webb.pdf - Adobe Acrobat Standard Let me know if this is all you need. From: Gail Ropp Sent: Thursday, March 27, 2008 1:58 PM To: Darren Katic Subject: Letter of Incumbency for Webb.pdf - Adobe Acrobat Standard Pacific Energy Resources Ltd. 4 0 9 111 W. Ocean Blvd., Ste 1240 Long Beach, CA 90802 Gail Ropp Office: 562- 628 -1526 Administrative Assistant Fax: 562 - 628 -1536 gropp @pacenergy.com 3/27/2008 Page 1 of 1 • . Maunder, Thomas E (DOA) From: Darren Katie [dkatic@pacenergy.com] Sent: Thursday, March 27, 2008 1:16 PM I To: 'Bruce D Webb'; Banks, Kevin R (DNR); Davies, Stephen F (DOA); Maunder, Thomas E (DOA) Cc: Danny S. Davis; Marino, Anthony C.; Copoulos, Arthur E (DNR); Gail Ropp; Wolf, Lynn G. Subject: RE: Letter of Incumbency for Webb.pdf - Adobe Acrobat Standard I sent it to Kevin Banks. From Bruce D Webb [mailto:bwebb @aurorapower.com] Sent: Thursday, March 27, 2008 2:19 PM To: Darren Katic; Kevin_Banks; Steve Davies; Tom Maunder Cc: Danny S. Davis; Marino, Anthony C.; Art Copoulos; Gail Ropp; Wolf, Lynn G. Subject: FW: Letter of Incumbency for Webb.pdf - Adobe Acrobat Standard Darren, Thank you. I have forwarded this off to the appropriate individuals. I understand the originals will be mailed to the addresses on the letter. Thank you for your assistance. -Bruce From: Darren Katic [mailto:dkatic @pacenergy.com] Sent: Thursday, March 27, 2008 1:00 PM To: 'Bruce D Webb' Subject: Letter of Incumbency for Webb.pdf - Adobe Acrobat Standard Let me know if this is all you need. From: Gail Ropp Sent: Thursday, March 27, 2008 1:58 PM To: Darren Katic Subject: Letter of Incumbency for Webb.pdf - Adobe Acrobat Standard 49 Pacific Energy Resources Ltd. 111 W. Ocean Blvd., Ste 1240 Long Beach, CA 90802 Gail Ropp Office: 562 - 628 -1526 Administrative Assistant Fax: 562-628-1536 gropp @pacenergy.com 3/28/2008 • • • PACIFIC ENERGY March 27, 2008 Kevin Banks, Acting Director State of Alaska Division of OiI and Gas 550 W. 7 Avenue, Suite 1100 Anchorage, AK 99501 -3560 John K. Norman, Chairman State of Alaska OiI and Gas Conservation Commission 333 W. 7 Avenue, Suite 100 Anchorage, AK 99501 Re: Letter of Incumbency for Webb Petroleum Services By Pacific Energy Resources Ltd., as Operator of the North Alexander Unit and the North Alexander No. 1 Exploratory Well Dear Mr. Banks and Mr. Norman: As Designation of Operator for the North Alexander Unit, Pacific Energy Resources Ltd. ( "PERL ") hereby appoints Mr. Bruce D. Webb of Webb Petroleum Services, as their agent. Please be advised that PERL grants Mr. Webb the executory powers necessary for the administration of all necessary permitting and regulatory actions required in conjunction with the North Alexander No. 1 exploratory Well. The executory powers granted herein specifically allow Mr. Webb to sign the permit, authorization requests and submittals necessary to obtain the required permits and authorizations for the aforementioned exploratory well only. These executory powers shall be effective immediately and shall remain in full force and effect until revoked by an officer of this company. Should you have any questions, please contact me at the telephone number below. Respectfully Submitted By, Darren Katic President Page 1 of 1 i • Maunder, Thomas E (DOA) From: Bruce D Webb [bwebb @aurorapower.com] Sent: Thursday, March 27, 2008 9:32 AM To: Vlado @Pacenergy. Com; 'Darren Katic' Cc: Marino, Anthony C.; Davies, Stephen F (DOA); Maunder, Thomas E (DOA); Danny S. Davis Subject: North Alexander No. 1 exloratory Well permits Importance: High Attachments: N. Alexander No. 1 APD10- 401.xls; 9 -18 -07 INCUMBENCY AUTHORIZATION.Ddf, NAU Letter of Incumbency for Pacific Energy as Operator.doc Vladimir /Darren, With the change of Operator approved by the Alaska Oil and Gas Conservation Commission, they are ready to issue the Permit to Drili for the above referenced well. Because Pacific is now the Operator of Record, the Attached Permit to Drili needs to be re- executed and submitted for the Commissioner's signatures. This may very well be the case with several of the permits. In an effort for expediency and efficiency, it would be best if you would authorize me to execute the necessary permits for the North Alexander No. 1 well, as Escopeta had done previously (letter attached). The permit need to be issued by TOMORROW, as Monday the 31st (deadline) is an Alaska State Holiday. Once executed and on Pacific Letterhgead, please mail the originals to the addressee's on the letter. In the mean time, please send a scanned copy by e-mail to all of the e-mail recipients above. Thank you for your immediate attention to this. -Bruce 3/28/2008 I 0 • i ..-..... 1 4 4, .,...- . oil oil 4 �i* Devslopmant SePteMbCt 18, 20(17 Mr, Bruce a Webb Webb Petroleum Services P.O. Box 113141 Anchorage. AK 99511-3141 RE.: Incumbency Authorisation ta Oil Company. LLC Dear Mr, Webb: Please be advised that Escopeta Oil Company, 1.1,C hereby grants you executory powers in conjunction with the permitting and regulatory affairs for the North Alexander No. 1 exploratory well. The executory powers granted herein specifically allow you to sign the necessary permit and authorisation ts necessary to obtain the required authorizations for the aforementioned exploration well. The executory powers are eficti‘e immediately and shall continue until revoked by an officer of this company. Should you have any questions, please contact me at the Houston telephone number below, Ven 1 rill\ \ 41,/ ( A : i ,...._ AO 1 OP S. Davis President Cc: Mr, John K. Norman. Chairman Ben t ireene. Manager. Oil and Gas State or Alaska State of Alaska. DNR Oil and Gas Conservation Commission Office of Project Mgmt & Permitting Mr. Matt Rader, CI Permitting Supervisor Kenton 1 ay lor. Commissioner State of Alaska, DNR State of Alaska, Dept. of Fish and Game Division of Oil and Gas For Susitna Flats State Game Refuge Mr. Bob Blankenburg, Env, Program Mgr. ',mirk StlIVen. Env, Program Mgr. State of Alaska, DEC State of Alaska. DEC Solid Waste Spill Prevention and Response Patricia Bettis. Nat. Resource Mgr. State of Alaska, DNR Division of Mining, Land and Water Irwin (Skip) Joy. Project Manager 11. S. Dept. of the Army Corps of Engineers Page 1 of 2 1 • Maunder, Thomas E (DOA) From: Bruce D Webb [bwebb @aurorapower.com] Sent: Monday, March 24, 2008 2:17 PM To: Maunder, Thomas E (DOA) Cc: Danny S. Davis Subject: RE: N. Alexander Well Thanks Tom, Danny should be getting you something in terms of a authorization. -Bruce From: Maunder, Thomas E (DOA) [mailto:tom.maunder @alaska.gov] Sent: Monday, March 24, 2008 2:01 PM To: Bruce D Webb Cc: Davies, Stephen F (DOA); Danny S. Davis Subject: RE: N. Alexander Well Bruce, Steve should be getting to you shortly. With regard to a "copy ", that is not possible without an authorization. Sorry. Tom Maunder, PE AOGCC From: Bruce D Webb [mailto:bwebb @aurorapower.com] Sent: Monday, March 24, 2008 1:20 PM To: Maunder, Thomas E (DOA) Cc: Davies, Stephen F (DOA); Danny S. Davis Subject: RE: N. Alexander Well Thanks Tom, I don't recall getting a message from Steve, that doesn't mean I did not get it — I may have inadvertantly deleted it. I certainly hope it was not BAD news! All I really need is a copy of the Permit. I do have all the original of the all the other agencies permits, so it might make sense for me to have this one as well. Because of the timing though, a copy will suffice. Is it possible to get a PDF of it e- mailed? Danny can send me back the original if it gets mailed to Houston. Danny, does this sound OK with you? Please let Tom Know. Thanks. -Bruce From: Maunder, Thomas E (DOA) [ mailto:tom.maunder@alaska.gov] Sent: Monday, March 24, 2008 12:23 PM To: Bruce D Webb Cc: Stephen F Davies Subject: N. Alexander Well 3/28/2008 Page 2 of 2 • Bruce, You may have received an earlier message from Steve regarding the "Designation of Operator". As I am finishing up my review, I note that although you have signed the letter as "Agent ", the permit was signed by Danny Davis and the address at the top is in Houston. If it is desired for you to pick up the permit, we need a letter from Danny authorizing such. Otherwise, when completed, the permit will be mailed to Houston. Call or message with any questions. Tom Maunder, PE AOGCC 3/28/2008 410 411 Davies, Stephen F (DOA) From: Maunder, Thomas E (DOA) Sent: Tuesday, March 18, 2008 3:47 PM To: Bruce D Webb Cc: Davies, Stephen F (DOA) Subject: RE: N. Alexander Permit to Drill Hi Bruce, You must be reading my mind. I was wondering about that as well. Steve Davies should be back in the office tomorrow and I will check with him. At the worst, it just may take a new 401 sheet. I will be in contact. Tom Maunder, PE AOGCC Original Message From: Bruce D Webb [mailto :bwebb @aurorapower.com] Sent: Tuesday, March 18, 2008 3:29 PM To: Maunder, Thomas E (DOA) Subject: N. Alexander Permit to Drill Importance: High Hi Tom, With the Designation of Operator being Pacific Energy now - for Escopeta Oil, that does fulfill the bonding requirement, right? AS Pacific has the AOGCC Statewide bond in place. Will you be able to issue the Permit to Drill within the next week? I have to compile all the applications and submit to the DNR before March 31st. Thanks again for all your assistance, double checking and guidance. -Bruce Original Message From: Bruce D Webb (mailto:bwebb@aurorapower.com) Sent: Wednesday, March 05, 2008 11:19 AM To: 'Maunder, Thomas E (DOA)' Cc: Danny S. Davis (escopeta @swbell.net) Subject: RE: N. Alexander Well- -again Tom, I have went over your questions and re- calculations with my consulting engineer. It is agreed that your assumptions on the typo's and cement volumes are correct, as follows: 1. The pressure gradient is calculated to be .59 psi per foot. 2. The cement volume for the 7" second stage is calculated to be 98.5 bbls, which is 472 sacks at a 1.17 yield. Thank you for your diligent review and assistance in this Permit to drill, as always, it is greatly appreciated. -Bruce 1 Page l of l • • Davies, Stephen F (DOA) From: Bruce D Webb [bwebb @aurorapower.com] Sent: Tuesday, March 18, 2008 4:26 PM To: Colombie, Jody J (DOA) Cc: Davies, Stephen F (DOA) Subject: RE: North Alexander No. 1 spacing Exception Jody, I believe that was the case. The permit deadline was moved to March 31S I believe Steve was awaiting the bonding issue to be resolved, which it should be now. -Bruce From Colombie, Jody J (DOA) [ mailto :jody.colombie @alaska.gov] Sent: Tuesday, March 18, 2008 3:57 PM To: Bruce D Webb Cc: Davies, Stephen F (DOA) Subject: RE: North Alexander No. 1 spacing Exception Bruce, This spacing exception has not been issued. For some reason I thought you and Steve had talked and that it was not needed right away. Please let me know. Jody Colombie Special Assistant Alaska OH & Gas Conservation Commission Direct: 907 - 793 -1221 Fax: 907 - 276 -7542 `Note new email address From: Bruce D Webb [mailto:bwebb @aurorapower.com] Sent: Tuesday, March 18, 2008 3:53 PM To: Colombie, Jody J (DOA) Cc: Davies, Stephen F (DOA) Subject: North Alexander No. 1 spacing Exception Hi Jody, I have been looking for the AOGCC Spacing Exception for the N. Alexander No. Exploratory Well. I thought it was issued back in mid - January, but if so, I have lost it. The public info request period ended December 26 and I believe the Public Hearing scheduled for January 10 was cancelled. Do you know if the Spacing Exception was ever issued, or was it pending Escopeta's bonding verification? If so, since Pacific has become the designated operator, it should be taken care of with their statewide bond on file. Let me know, Thanks. -Bruce 3/27/2008 • • • ( 4• ! - • 4 oi & Gas Development February 25, 2008 Kevin Banks, Acting Director RECEIVED State of Alaska Division of Oil and Gas FB 2 6 2 008 550 W. 7 Avenue, Suite 1100 Alaska Oil Gas Cons. Commission Anchorage, AK 99501 -3560 Anchorage John K. Norman, Chairman State of Alaska Oil and Gas Conservation Commission 333 W. 7`" Avenue, Suite 100 Anchorage, AK 99501 Re: Designation of Unit Operator North Alexander Unit Dear Mr. Banks and Mr. Norman: Pursuant to 11 AAC 83.331 and 20 AAC 25.020, Escopeta Oil Company, LLC (Escopeta) hereby designates Pacific Energy Resources Ltd. (PER) as the Unit Operator for the North Alexander Unit. It is the intention of Escopeta to have PER fulfill the outstanding Unit Plan of Exploration obligations, including the drilling of the North Alexander No. 1 exploration well. Attached for your review and approval is the Alaska Oil and Gas Conservation Commission's Designation of Operator form 10 -411. Because of the timing of the Unit Plan of Operations obligations, your expedited approval is requested. Respectfully _ - itted By, Da 4 S. Davis President Attachments 5005 Riverway, Suite 440 • Houston, Texas 77056 • Office: 713 623 2219 • Fax 713.439.1205 • E -mail: escopeta @swbell.net 4111► • • of & Gas Development March 26, 2008 Mr. Tom Maunder Petroleum Engineer AOGCC 333 W. 7th Ave., Ste. 100 Anchorage, Alaska 99501 Via Email: Tom.maunder @alaska.gov_ Re: AOGCC Permit Dear Mr. Maunder: This is authorization that Bruce Webb should receive the AOGCC Permit. Please contact me should further information be needed. Yours truly, Danny ` i avis President 5005 Riverway; Site 440 • Houston, Texas 77056 • Office 713 623 2219 • Fax 713.439.1205 • E -mail: escooetaeswbell. net • Davies, Stephen F (DOA) � ) From: Davies, Stephen F (DOA) Sent: Monday, December 31, 2007 8:54 AM To: 'brucewebb@gci.net' Subject: FW: N. Alexander 1 -- No Bond Yet from Escopeta Bruce, I just checked with our staff special assistant, and the Commission has not yet received a bond from Escopeta for the N. Alexander 1 well. Thanks, Steve Davies AOGCC 907 - 793 -1224 Original Message From: Davies, Stephen F (DOA) Sent: Thursday, December 20, 2007 1:28 PM To: brucewebb @gci.net Subject: N. Alexander 1 No Bond Yet from Escopeta Bruce, Just a reminder: the Commission still has not received a bond from Escopeta for the N. Alexander 1 well. Thanks, Steve Davies AOGCC 907 - 793 -1224 Original Message From: Davies, Stephen F (DOA) Sent: Tuesday, December 18, 2007 3:08 PM To: 'brucewebb @gci.net' Subject: RE: N. Alexander photos, part 2 Bruce: I haven't heard from Danny Davis or Escopeta about shallow hazards. Thanks, Steve Davies AOGCC Original Message From: Bruce Webb [mailto:brucewebb @gci.net] Sent: Wednesday, November 28, 2007 11:17 PM To: Rader, Matthew W (DNR); Bethe, Amber N (DFG); Delgado - Plikat, Josephina L (DNR) Cc: Irwin, Tom E (DNR); Banks, Kevin R (DNR); Taylor, Kenton P (DFG); Copoulos, Arthur E (DNR); Danny S. Davis; BRUCE @ AURORA; Mylius, Richard H (DNR); JColonell @entrix.com; Fogels, Edmund J (DNR); Farley, Kathleen M (JPO); Pexton, Scott R (JPO); Fink, Mark J (DFG); Maclean, Scott H (DNR); Marie, Megan E (DNR); Bettis, Patricia K (DNR); Bethune, Stephen W (DNR); Easton, John R (DNR); Goatley, Margie M (DNR); Davies, Stephen F (DOA); Combellick, Rod A (DNR); Silfven, Laurie A (DEC); Roche, Frances E (DEC); Krauss, Brenda K (DEC); Blankenburg, Robert J (DEC); Ryan, Sally A (DEC); Pearson, Leslie A (DEC); Kruse, 1 f Kim M (DNR); Soderlund .Diannoepamail.epa.gov; rockwell.theooe @epa.gov; Burgh.Colleen @epa.gov; tyonek @aitc.org; barbara.mahoney @noaa.gov; Mary_Nation@fws.gov; snainc @alaska.com; tkroto @tyonek.com; manny .lopez @enstarnaturalgas.com; Greene, Ben A (DNR); susan.lee @matsugov.us; Kukla, Alan F (DEC) Subject: N. Alexander photos, part 2 continued... 2 • i4 • _- • ui S Oil & Gas Development January 22, 2008 Mr. Tom Maunder State of Alaska RECEIVED Oil and Gas Conservation Commission 333 W. 7tn Avenue, Suite 100 JAN 2 2 2008 Anchorage, AK 99501 Alaska Oil & Gas dons. l;ammission Anchorage Re: N. Alexander No. 1 Exploratory Well Delay of Drilling Schedule Dear Mr. Maunder, Please be advised that the actual drilling of the North Alexander No. 1 exploratory well has been delayed until the next winter drilling season of 2008/2009. However, even though the drilling is delayed by one year, the Department of Natural Resources has required that the Permit to Drill be issue and evidenced by March 31, 2008, to comply with the Notice of Default in conjunction with the Plan of Exploration. In order to accomplish this deadline, it will be necessary to receive the Permit to Drill in mid - March. The bonding for this well is in the process and should be delivered to the AOGCC shortly. Respectfully Submitted By, Bruce D. Webb Webb Petroleum Services Agent for Escopeta Oil Company, LLC Attachments 5005 Riverway, Suite 440 • Houston, Texas 77056 • Office: 713.623.2219 • Fax 713.439.1205 • E -mail: escopetaOswbell.net • 110 411 Maunder, Thomas E (DOA) From: Bruce D Webb [bwebb@aurorapower.com] Sent: Wednesday, March 05, 2008 11:19 AM To: Maunder, Thomas E (DOA) Cc: Danny S. Davis Subject: RE: N. Alexander Well —again Tom, I have went over your questions and re- calculations with my consulting engineer. It is agreed that your assumptions on the typo's and cement volumes are correct, as follows: 1. The pressure gradient is calculated to be .59 psi per foot. 2. The cement volume for the 7" second stage is calculated to be 98.5 bbls, which is 472 sacks at a 1.17 yield. Thank you for your diligent review and assistance in this Permit to drill, as always, it is greatly appreciated. -Bruce 1 . • Maunder, Thomas E (DOA) From: Maunder, Thomas E (DOA) Sent: Wednesday, February 27, 2008 8:01 AM To: 'bwebb @aurorapower.com'; David Boelens Subject: RE: N. Alexander Well—again Bruce and Dave, Waiting shouldn't be an issue. I will be gone next week back in office March 11. It will be my intent to move the permit forward recommending approval when I return. Call or message with any questions. Tom Maunder, PE AOGCC Original Message From: Webb [mailto:bwebb @aurorapower.com] Sent: Tuesday, February 26, 2008 6:58 PM To: Maunder, Thomas E (DOA); David Boelens Subject: RE: N. Alexander Well - -again Tom and Dave, I believe the calculations that Tom worked out are correct but I need to confirm with the third party engineer. Internet access here is limited to the hotel service and I do not have the option of connecting my laptop to the Internet. If this issue can wait, I will be back on Wednesday, March 4th, and will contact you then. Otherwise, I will do my best to confirm ASAP and will be checking my email tomorrow night. - Bruce Original Message From: David Boelens < dboelens @aurorapower.com> Date: Tue, 26 Feb 2008 16:01:51 -0900 >Tom >I do recall Bruce telling me he had an 3rd party engineer assist with >the calculations, but I do not recall who he said he used. Bruce does >have his laptop with him and said he would sign in as his travel plans and access to >the internet permits. In addition, we have left message on his cell phone >to call the office. >David Boelens >VP Alaska Operations >Aurora Power /Gas /Well Service /Shirleyville Ent >Phone 907 - 277 -1003 >Fax 907 - 277 -1006 >From: Maunder, T o . DOA) [mailto:tom.maunder @alaska.gov] >Sent: Tuesday, Februar • 'Iry . `- o':, _ >To: dboelens•. ..ower.com >Sub N. Alexander Well - -again 1 Page 1 of 2 • Maunder, Thomas E (DOA) From: David Boelens [dboelens @aurorapower.com] Sent: Tuesday, February 26, 2008 11:04 AM To: Maunder, Thomas E (DOA) Subject: RE: N. Alexander Well —again Tom I will call Bruce and see who did the cement calculations and follow up with them. My background is on the Aurora Well Service equipment side and I leave the down hole stuff to the engineers. David Boelens VP Alaska Operations Aurora Power /Gas/Well Service /Shirleyville Ent Phone 907 - 277 -1003 Fax 907 - 277 -1006 From: Maunder, Thomas E (DOA) [mailto:tom.maunder@alaska.gov] Sent: Tuesday, February 26, 2008 9:26 AM To: dboelens @aurorapower.com Subject: FW: N. Alexander Well- -again Good to speak with you Dave. Here are the messages I sent Bruce. look forward to your response. Tom Maunder, PE AOGCC From: Maunder, Thomas E (DOA) Sent: Monday, February 25, 2008 3:42 PM To: 'Bruce D Webb' Subject: RE: N. Alexander Well- -again Bruce, I need you to have Dave or whoever did the cementing calculations to look at the 7" 2 stage tail on page 7 of 11. It appears that volumes concerned with hole and casing below the stage tool have been included. Based on my understanding of stage tools, this is not correct. If I understand the stated intent, the minimum 2nd stage "neat" tail volume would be the capacity of 2500' of 7" casing. That volume is 98.5 bbls (472 sx @ 1.17 yield) as shown in the 3rd line of the calculation. Again, please confirm. Tom Maunder, PE AOGCC From: Maunder, Thomas E (DOA) Sent: Monday, February 25, 2008 3:01 PM To: 'Bruce D Webb' 2/26/2008 Page2of2 • • Subject: N. Alexander Well Bruce, I am attempting to finish my review and have a question ... 1. On page 7 of 11 in the pressure calculations two different gradients (.49 and .59 psi/ft) are listed. It would appear that the .59 psi/ft is a typo. Please confirm. Thanks. Tom Maunder, PE AOGCC 2/26/2008 • i Maunder, Thomas E (DOA) From: Maunder, Thomas E (DOA) Sent: Tuesday, February 19, 2008 9:44 AM To: 'Bruce D Webb' Subject: RE: BOP Stack Requirements- Again Thanks Bruce. I needed to ask again as I felt I was specific to the stack and needed to confirm the rig pipe is sufficiently rated. Tom Original Message From: Bruce D Webb [mailto:bwebb @aurorapower.com] Sent: Tuesday, February 19, 2008 9:40 AM To: Maunder, Thomas E (DOA) Subject: RE: BOP Stack Requirements- Again Hi Tom, The BOP and Accumulator will be 5,000# - rented from MI Swaco. Dave Boelens says that the choke and all piping are already rated to over 5,000 #. He also said it will end up being the same configuration that he will be using on the Armstrong well in the lower Kenai this spring. Hope that helps. Thanks. -Bruce Original Message From: Maunder, Thomas E (DOA) [mailto:tom.maunder @alaska.gov] Sent: Sunday, February 17, 2008 1:02 PM To: Bruce D. Webb Subject: RE: BOP Stack Requirements- Again Bruce, Thanks for the reply on the stack rating. Is the choke manifold and other piping also rated 5K? Thanks in advance. Tom Maunder, PE AOGCC Original Message • : Maunder, Thomas E (DOA) Sent: hursday, February 14, 2008 2:47 PM To: 'Bru D. Webb' Subject: RE: :■P Stack Requirements Bruce, Hope this is still your - :•ress. Just wanted to foil. up with regard to the North Alexander well and the BOP s . k rating. I am wo ng to get that permit out as we discussed, but needed to confirm ..at the sta rating that will be employed is 5K rather than 3K. The maximum surface pressu ca -. ation as I remember was greater than 3000 psi. We had talked informally about th': in Dece . as I remember. I look forward to your reply. Tom Maunder, PE AOGCC Original v - ssage From: Bruc= •. Webb [mailto:bwebb @aurorapower.com] Sent: day, September 07, 2007 10:02 AM To 'aunder, Thomas E (DOA) ubject: RE: BOP Stack Requirements 1 • • Maunder, Thomas E (DOA) From: Bruce D Webb [bwebb@aurorapower.com] Sent: Thursday, February 14, 2008 4:13 PM To: Maunder, Thomas E (DOA) Subject: RE: BOP Stack Requirements Hi Tom, Nice to hear from you. You are entirely correct in your recollections. I had spoken to Danny Davis and Dave Boelens and they indicated that a 5K BOP Stack was appropriate, and would require a shallow cellar to accommodate the increased stack height. Have a wonderful evening. -Bruce Bruce D. Webb Manager, Land and Regulatory Affairs Aurora Gas, LLC 1400 W. Benson Blvd., Suite 410 Anchorage, AK 99503 (907) 277 -1003 office (907) 229 -8398 cell (970) 277 -1006 fax Original Message From: Maunder, Thomas E (DOA) [mailto:tom.maunder @alaska.gov] Sent: Thursday, February 14, 2008 2:47 PM To: Bruce D. Webb Subject: RE: BOP Stack Requirements Bruce, Hope this is still your eddress. Just wanted to follow -up with regard to the North Alexander well and the BOP stack rating. I am working to get that permit out as we discussed, but needed to confirm that the stack rating that will be employed is 5K rather than 3K. The maximum surface pressure calculation as I remember was greater than 3000 psi. We had talked informally about this in December as I remember. I look forward to your reply. Tom Maunder, PE AOGCC Original Message From: Bruce D. Webb [mailto:bwebb @aurorapower.com] Sent: Friday, September 07, 2007 10:02 AM To: Maunder, Thomas E (DOA) Subject: RE: BOP Stack Requirements Thanks Tom. Original Message From: Maunder, Thomas E (DOA) [mailto:tom.maunder @ alaska.gov] Sent: Friday, September 07, 2007 10:00 AM To: Bruce D. Webb Subject: RE: BOP Stack Requirements Bruce, The necessary rating of the BOP is related to the calculated MASP (maximum anticipated surface pressure). If you assume a water gradient 1 4 (.433 psi /ft) to 8500' the bo pressure calculates at I80 psi. Subtracting a gas gradient of 0.1 psi /ft gives a calculated MASP of 2830 psi. If these values are valid, it would appear that an API 3K stack would be appropriate. If Dave has a question, have him send a message or call. Tom Maunder, PE AOGCC Original Message From: Bruce D. Webb [mailto:bwebb @aurorapower.com] Sent: Friday, September 07, 2007 9:45 AM To: Maunder, Thomas E (DOA) Subject: BOP Stack Requirements Hi Tom, A quick question The Aurora Well Service rig typically drills between 4,000 and 6,000 feet. The BOP stack is rated to 3,000 PSI. If we wanted to try and drill a gas well to 8,500 feet with 2 -7/8" drill pipe, would we need a higher rated BOP? Dave Boelens is concerned that there is a PSI rating that corresponds to certain depths. I, of course, have no idea. -Bruce No virus found in this incoming message. Checked by AVG Free Edition. Version: 7.5.485 / Virus Database: 269.13.8/993 - Release Date: 9/6/2007 3:18 PM 2 S [ R\S +� SARAH PALIN, GOVERNOR J 555 Cordova Street Anchorage, AK 99501 DEPT. OF ENVIRONMENTAL CONSERVATION PHONE: (907) 269 -3094 FAX: (907) 269 -7687 DIVISION OF SPILL PREVENTION AND RESPONSE ht://www.dec.state.ak.us INDUSTRY PREPAREDNESS PROGRAM Exploration Production & Refineries December 27, 2007 File No. 305.05_ (Escopeta North Mexander #1) Mr. Bruce D. Webb - Webb Petroleum Services P.O. Box 113141 - Anchorage, Alaska 99511 -3141 Subject: Exemption from Oil Discharge Prevention and Contingency Plan Requirement for Escopeta Oil & Gas Development North Alexander #1 Exploration Well Dear Mr. Webb: The Alaska Department of Environmental Conservation (ADEC) has received a determination from the Alaska Oil and Gas Conservation Commission (AOGCC) regarding the Escopeta Oil & Gas request for an exemption from Oil Discharge Prevention and Contingency Plan (ODPCP) and Financial Responsibility (FR) requirements. The exemption was requested for a drilling operation at the North Alexander #1 gas exploration well site north of Beluga, Alaska. AOGCC reviewed information submitted by you in addition to their own well files for four exploratory wells that lie within a 7 -mile radius of the proposed North Alexander #1 well. On December 19, 2007, AOGCC determined that there is a reasonable certainty that the well will not penetrate a formation capable of flowing oil to the ground surface in accordance with AS 31.05.030(/). Based upon AOGCC's evaluation and determination, ADEC hereby finds that the North Alexander #1 well meets the standards for exemption as a natural gas exploration facility under AS 46.04.050(c) and is exempt from ODPCP and FR requirements found in AS 46.040.030 and AS 46.040.040. Be advised that should Escopeta penetrate a formation capable of flowing oil to the ground surface during the drilling of this well, operations must immediately be suspended and ADEC must be immediately notified. Escopeta must obtain ODPCP and FR approval by ADEC prior to proceeding. This exemption does not relieve Escopeta of the responsibility for securing other federal, state or local approvals or permits. Escopeta is still required to comply with all other applicable laws. ♦„� Primed on Recyc!�..€ • • Bruce D. Webb 2 December 27, 2007 Webb Petroleum Services 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 me at 269 -7680. incere , , , \1 \ re; Gould Sect I n Manager cc: Laurie Silfven, ADEC Betty Schorr, ADEC Chris Pace, ADEC, Juneau John Norman, AOGCC Ben Greene, ADNR Gary Williams, KPB Michael Munger, CIRCAC Page 1 of 1 • Davies, Stephen F (DOA) From: Bruce D Webb [bwebb @aurorapower.com] Sent: Wednesday, December 26, 2007 9:08 AM To: Davies, Stephen F (DOA) Subject: FW: Shallow Hazards Analysis Good Morning Steve, Hope your Christmas went well. I received this note from Frank this morning, did you get anything from him (Escopeta mail) today? I have not. I also talked to Danny Davis, he indicated he would be working on the Bonding /Irrevocable Letter of Credit(s) today... two for DNR and one for the AOGCC. -Bruce From: frank banar [ mailto :frankbanar @sbcglobal.net] Sent: Wednesday, December 26, 2007 8:06 AM To: Bruce D Webb Subject: Re: Shallow Hazards Analysis My computer at home was not working. Today I wrote something on the shallow hazards at Escopeta's office to Steve and made a copy for you. It should go out today by E -mail. The stuff I sent you can go to the State if they want it...it just shows them that we have done alot of work with the data that we had. Bruce D Webb <bwebb@aurorapower.com> wrote: Frank, I received a package today containg multiple seismic plates, well logs and the N. Alexander Prospect Summary. I understand this information is in support of your analysis addressing any possible (or lack thereof) shallow geophysical hazards. Steve Davies needs some write up by you that indicates you have not seen any sags, bright spots, phase reversals, or anything else in the geological and geophysical information that might indicate the presence of abnormal gas pressures at a shallow depth. A brief discussion referencing well logs, velocity, or other information in support of a determination that no shallow geophysical hazards exist, or are not likely to be encountered, would also be helpful. An e-mail from you directly to Mr. Davies (address above) will be sufficient. Please include me in the cc distribution so I can have it for the records here. I will drop off the information you have sent to Mr. Davies and indicate it is confidential. Please advise if you require this package of information back, or if the AOGCC is suppose to file it with the N. Alexander well data. If you need to speak to Steve directly for any clarification, his direct phone number is (907) 793- 1224. Your time, expertise and assistance is greatly appreciated. -Bruce 12/31/2007 . 410 Davies, Stephen F (DOA) From: Davies, Stephen F (DOA) Sent: Thursday, December 20, 2007 1:28 PM To: brucewebb c@gci.net Subject: N. Alexander 1 -- No Bond Yet from Escopeta Bruce, Just a reminder: the Commission still has not received a bond from Escopeta for the N. Alexander 1 well. Thanks, Steve Davies AOGCC 907 - 793 -1224 Original Message From: Davies, Stephen F (DOA) Sent: Tuesday, December 18, 2007 3:08 PM To: 'brucewebb @gci.net' Subject: RE: N. Alexander photos, part 2 Bruce: I haven't heard from Danny Davis or Escopeta about shallow hazards. Thanks, Steve Davies AOGCC Original Message From: Bruce Webb [mailto:brucewebb @gci.netj Sent: Wednesday, November 28, 2007 11:17 PM To: Rader, Matthew W (DNR); Bethe, Amber N (DFG); Delgado - Plikat, Josephina L (DNR) Cc: Irwin, Tom E (DNR); Banks, Kevin R (DNR); Taylor, Kenton P (DFG); Copoulos, Arthur E (DNR); Danny S. Davis; BRUCE @ AURORA; Mylius, Richard H (DNR); JColonell @entrix.com; Fogels, Edmund J (DNR); Farley, Kathleen M (JPO); Pexton, Scott R (JPO); Fink, Mark J (DFG); Maclean, Scott H (DNR); Marie, Megan E (DNR); Bettis, Patricia K (DNR); Bethune, Stephen W (DNR); Easton, John R (DNR); Goatley, Margie M (DNR); Davies, Stephen F (DOA); Combellick, Rod A (DNR); Silfven, Laurie A (DEC); Roche, Frances E (DEC); Krauss, Brenda K (DEC); Blankenburg, Robert J (DEC); Ryan, Sally A (DEC); Pearson, Leslie A (DEC); Kruse, Kim M (DNR); Soderlund .Dianne @epamail.epa.gov; rockwell.theodore @epa.gov; Burgh.Colleen @epa.gov; tyonek @aitc.org; barbara.mahoney @noaa.gov; Mary_Nation @fws.gov; snainc @alaska.com; tkroto @tyonek.com; manny.lopez @enstarnaturalgas.com; Greene, Ben A (DNR); susan.lee @matsugov.us; Kukla, Alan F (DEC) Subject: N. Alexander photos, part 2 continued... 1 Page 1 of 2 1 Davies, Stephen F (DOA) From: Davies, Stephen F (DOA) Sent: Wednesday, November 14, 20071:10 PM To: Bruce D Webb Subject: RE: spacing exception v. permit to drill Bruce, Regulation 20 AAC 25.025(a) starts by stating: "An operator proposing to drill a well for which a permit is required under 20 AAC 25.005 shall file a bond and, if required under (2) of this subsection, security to ensure that each well is drilled, operated, maintained, repaired, and abandoned and each location is cleared in accordance with this chapter... ". Commission senior staff uses a standardized checklist during our review of every permit to drill application. One of the questions on that checklist is: "Operator has appropriate bond in force ?" So, permit to drill applications cannot be approved before a bond has been filed and approved by the Commission. Ownership /operator records must also be complete prior to approval. I also handle bonding, and Escopeta does not have one in place with the AOGCC. Steve Davies AOGCC 793 -1224 From: Bruce D Webb [mailto:bwebb @aurorapower.com] Sent: Tuesday, November 13, 2007 4:51 PM To: Davies, Stephen F (DOA) Subject: RE: spacing exception v. permit to drill Thanks again Steve, It looks like Escopeta has everything, except maybe the Bond. Danny Davis will be here tomorrow to meet with Dave Boelens and myself and I will ask him. Is there a database or individual at AOGCC I can check with as well, to verify (not that I wouldn't believe Danny Davis). I assume they need the bond in place — first — for the permit to drill, and cannot have the permit contingent on a bond prior to drilling activities, or could they? -Bruce Bruce D. Webb Manager, Land and Regulatory Affairs Aurora Gas, LLC 1400 W. Benson Blvd., Suite 410 Anchorage, AK 99503 (907) 277 -1003 office (907) 229 -8398 cell (970) 277 -1006 fax From: Davies, Stephen F (DOA) [ mailto:steve.davies @alaska.gov] Sent: Tuesday, November 13, 2007 3:15 PM To: Bruce D Webb Subject: RE: spacing exception v. permit to drill 12/31/2007 Page 2 of 2 • • Bruce, Yes, Escopeta can submit the application in advance of the permit to drill so long as Escopeta: 1. owns the lease upon which operations are proposed, 2. has submitted any required change of ownership and designation of operator forms for the affected lease(s), 3. has a bond in place with the Commission, and 4. Provides enough information for the Commission to publish a notice in the newspaper and online, such as: • surface and bottom hole locations, • which section(s) of 20 AAC 25.055 need exceptions, and • why the exceptions are needed (too close to lease line, too close to nearby well, second well in governmental section or quarter - section, etc.) Please let me know if you have additional questions. Steve Davies AOGCC 793 -1224 From: Bruce D Webb [mailto:bwebb @aurorapower.com] Sent: Tuesday, November 13, 2007 9:31 AM To: Davies, Stephen F (DOA) Subject: spacing exception v. permit to drill Good morning Steve, I am helping Escopeta with their N. Alexander No. 1 well. They have decided to drill it only 625' from the section line. According to the DNR Unit Plan of Exploration commitments require all permits to be in place by December 31st. I know the Spacing Exceptions take about 45 days, and the Permit to Drill only a couple weeks. The engineer working up the drilling /casing /cementing /mud plan is traveling for about a week, and I need to get the ball rolling in the right direction. Is it possible to submit the Spacing Exception Application in advance of the Permit to Drill (by a couple weeks)? Thank you once again for your guidance. Bruce D. Webb Manager, Land and Regulatory Affairs Aurora Gas, LLC 1400 W. Benson Blvd. , Suite 410 Anchorage, AK 99503 (907) 277 -1003 office (907) 229 -8398 cell (970) 277 -1006 fax 12/31/2007 f • W ©rzL A KA SARAH PALIN, GOVERNOR DEPARTMENT OF NATURAL RESOURCES 550 WEST 7 AVENUE, SUITE 800 ANCHORAGE, ALASKA 99501 -3560 DIVISION OF OIL & GAS ONE: (90) 69 -8800 FAX (907) 7 269 2 -8938 CERTIFIED MAIL -- RETURN RECIEPT REQUESTED December 31, 2007 Bruce D. Webb, Agent for Escopeta Oil Company, LLC Webb Petroleum Services Danny Davis, President 5005 Riverway, Suite 440 Houston, Texas 77056 Re: North Alexander Unit Plan of Exploration Requests for Modification Dear Mr. Webb and Davis: The Division of Oil and Gas (Division) received Escopeta Oil Company, LLC's (EOC) letter, dated September 25, 2007, requesting several modifications to the North Alexander Unit (NAU) Initial Plan of Exploration (initial POE). EOC asked the Division to modify the initial POE to allow it to "apply for" rather than "obtain" all required peuiiits by December 31, 2007 (Request #1). EOC indicated that: 1) it has fulfilled the intent of the 2007 — Year one work obligation; 2) issuance of the aforementioned permits are inevitable; 3) EOC is positioned far in advance of any other prospective company in exploring the acreage within the NAU, and; 4) EOC has done everything within its power to facilitate the issuance of the peimits in order to comply with this year's work obligation and that the actual issuance of the permits is now out of EOC's control. In an email dated December 7, 2007, EOC indicates that the December 31, 2007 deadline under the initial POE will not be met but that "permits necessary for drilling ... will be in place literally a few days past the Existing POE deadline." EOC will "just miss" the December 31, 2007 permit deadline in the initial POE. EOC has known about the December 31, 2007 permit deadline since January 31, 2007 when the NAU was approved. EOC waited at least eight months after NAU approval to file permit applications. EOC did not apply for land and environmental permits until October 8, 2007. EOC did not apply for a permit to drill and a spacing exception until November 15, 2007. Request #1 is denied under 11 AAC 83.303 because failure to timely obtain the required permits delays timely exploration, delineation, and production of the expiring NAU leases. The NAU was approved because EOC represented that it would result in drilling and exploration faster than re- leasing expiring NAU acreage. There was no drilling and exploration in the NAU during the primary term of expiring leases and EOC has not met its 2007 permitting obligation. The December 31, 2007 permit deadline was established in anticipation of 2007/2008 winter drilling. "Develop, Conserve, and Enhance Natural Resources for Present and Future Alaskans." Division of Oil & Gas 12/31/07 Page 2 of 2 EOC has made progress towards obtaining the required permits. Therefore, the NAU will not terminate and expired leases need not be surrendered back to the state on January 2, 2008 as required under the initial POE. Instead, this is notice of a default of the NAU under 11 AAC 83.374(a). The Division provides EOC with the following opportunity to cure the default under 11 AAC 83.374(b): By March 31, 2008, EOC shall obtain an approved Division Plan of Operations, and all other associated and required local, state, and federal permits necessary for drilling and associated activities within the NAU and shall provide written evidence to the Division that the permits have been obtained. This notice of default effectively defers the December 31, 2007 drilling permit deadline to March 31, 2008. This notice of default, however, protects the state's interest because it insures that the leases will return to the state if they are not timely developed. The Division also reviewed other requests in EOC's September 25, 2007 letter. A summary of EOC's other requests and Division responses are as follows: Request #2a: EOC requested to amend the initial POE so that an exploration well could be drilled as late as March 31, 2009 or in the 2008/2009 winter drilling season. EOC indicated that more time was needed due to the unseasonably warm weather, surface conditions, exploratory rig and rig crew availability, need for multi- company coordination, and for flexibility to accommodate uncertainties. EOC characterized the December 31, 2008 drilling deadline, required under the NAU initial POE, as "unrealistic" and indicated that "it is extremely unlikely that the drilling rig will be made available for a one -well project this winter." EOC has also indicated a multi -well drilling program is being developed with other operators for 2008 through the winter of 2008/2009 and that the POE modifications are in the best interest of the State. Request #2b: EOC requested minor revisions to the well's target depth and location based on revised geologic and geophysical interpretations. Division response to Request #2a: Request #2a to amend the initial POE so that an exploration well could be drilled as late as March 31, 2009 is not in the state's interest and is denied under 11 AAC 83.303. The NAU was approved on the basis that it would result in drilling and exploration faster than re- leasing expiring NAU acreage and in anticipation of 2007/2008 winter drilling. There was no drilling and exploration in the NAU during the primary term of expiring lease. It is unclear when and if EOC will drill. EOC has not conclusively ruled out 2008 drilling. EOC has not provided: 1) a firm drilling commitment for 2008/2009 winter drilling; 2) a fully executed drilling rig contract and; 3) a fully executed multi -well drilling partner agreement. EOC is encouraged to resubmit this request when drilling plans are firm and it can document a firm drilling commitment. Approval of this request risks further delay in the timely exploration, delineation, and production of the expiring NAU leases. Although time is granted to cure the default of EOC's year one work obligation, EOC should not assume that the year two work obligation and unit term will be further extended. • Division of Oil & Gas 12/31/07 Page 3 of 3 Division response to Request #2b: Request #2b is approved. Item #1 of the initial POE, Year two work obligation, is modified as follows: 2008 - Year two work obligations - Drill an exploration well within the NAU: By December 31, 2008, EOC shall drill an Exploration Well within the NAU to a bottomhole location within ADL 390586, to a minimum total vertical depth (TVD) of 8500 feet and at a minimum penetrating the Beluga and Tyonek Formations. EOC shall provide the Division with all log data acquired (GR or SP, Resistivity and Neutron/Density or Porosity: appropriate triple combo log and other logs). Approval of these target depth and location revisions do not pre -empt any other required state permit approvals. Request #3: EOC requested to amend paragraph four of the additional provisions to "apply for approval" rather than "obtain approval" to establish a Participating Area.... EOC indicated that modifications to paragraph four: 1) are in the best interest of the state; 2) are consistent with the Mission and goals of the Department of Natural Resources; 3) are not unusual; 4) do not damage or prejudice other companies or leaseholders, and; 5) are being made proactively... due to situations out of the direct control of EOC. Division response to Request #3: The Division will consider this request after EOC has fulfilled its 2008 work obligation. 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 Tom Irwin, Commissioner, Department of Natural Resources, 550 W. 7th Avenue, Suite 1400, Anchorage Alaska 99501; faxed to 1- 907269- 8918; or sent by electronic mail to drir_appeals@alaska.gov. This decision takes effect immediately. 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, • Kevin Banks Acting Director cc: Art Copoulos, DNR • • Division of Oil & Gas 12/31/07 Page4 of4 Cammy Taylor, DNR Temple Davidson, DNR Matt Rader, DNR Jeff Landry, Department of Law Nan Thompson, DNR X7-/69 • �S • � • 4 Oil & Gas Development January 10, 2008 RECEIVED Mr. Steve Davies ! AN 1 Q 2008 State of Alaska �lasica Oil & Gas Cons. Commission Oil and Gas Conservation Commission Anchorage 333 W. 7' Avenue, Suite 100 Anchorage, AK 99501 Re: N. Alexander No. 1 Exploratory Well Data Submission in support of the Shallow Hazards Analysis Dear Mr. Davies, Attached, please find the following data submittals in support of the Shallow Hazards Analysis for the above referenced well: /Plate J, Interpretive Geologic X- Section non - confidential g rn� /Plate K, Seismic data for line #2 confidential-4'0-4 o•4 /k. v Itiisrr�J 464- w/ H Plate L, Seismic data for line #5 confidential -2 V4r5ea iws _ I is 6 i s46/•c. j 2- (Plate M, Seismic data for line #7 confidential - o„ cKa.. i �\ �' ``�`�" "' / e.-G "Plate P, Regional Structure Map confidential /Plate R, Bell Island #1 Log non - confidential /Top of Tyonek Interpretive Structure Map confidential -- pa's 64i""4. The above data so indicated as confidential is requested to be kept confidential under .F t con q p 20 AAC 25.537 (b), as the information used to prepare said data is considered proprietary and of a commercial nature. Respectfully Submitted By, Bruce D. Webb Webb Petroleum Services Agent for Escopeta Oil Company, LLC C Attachments 5005 Riverway, Suite 440 • Houston, Texas 77056 • Office: 713.623.2219 • Fax 713.439.1205 • E -mail: escopeta @swbell.net • • Davies, Stephen F (DOA) From: Davies, Stephen F (DOA) Sent: Monday, December 31, 2007 8:54 AM To: 'brucewebb @gci.net' Subject: FW: N. Alexander 1 -- No Bond Yet from Escopeta Bruce, I just checked with our staff special assistant, and the Commission has not yet received a bond from Escopeta for the N. Alexander 1 well. Thanks, Steve Davies AOGCC 907 - 793 -1224 Original Message From: Davies, Stephen F (DOA) Sent: Thursday, December 20, 2007 1:28 PM To: brucewebb @gci.net Subject: N. Alexander 1 No Bond Yet from Escopeta Bruce, Just a reminder: the Commission still has not received a bond from Escopeta for the N. Alexander 1 well. Thanks, Steve Davies AOGCC 907 - 793 -1224 Original Message From: Davies, Stephen F (DOA) Sent: Tuesday, December 18, 2007 3:08 PM To: 'brucewebb @gci.net' Subject: RE: N. Alexander photos, part 2 Bruce: I haven't heard from Danny Davis or Escopeta about shallow hazards. Thanks, Steve Davies AOGCC Original Message From: Bruce Webb [mailto:brucewebb @gci.net] Sent: Wednesday, November 28, 2007 11:17 PM To: Rader, Matthew W (DNR); Bethe, Amber N (DFG); Delgado - Plikat, Josephina L (DNR) Cc: Irwin, Tom E (DNR); Banks, Kevin R (DNR); Taylor, Kenton P (DFG); Copoulos, Arthur E (DNR); Danny S. Davis; BRUCE @ AURORA; Mylius, Richard H (DNR); JColonell @entrix.com; Fogels, Edmund J (DNR); Farley, Kathleen M (JPO); Pexton, Scott R (JPO); Fink, Mark J (DFG); Maclean, Scott H (DNR); Marie, Megan E (DNR); Bettis, Patricia K (DNR); Bethune, Stephen W (DNR); Easton, John R (DNR); Goatley, Margie M (DNR); Davies, Stephen F (DOA); Combellick, Rod A (DNR); Silfven, Laurie A (DEC); Roche, Frances E (DEC); Krauss, Brenda K (DEC); Blankenburg, Robert J (DEC); Ryan, Sally A (DEC); Pearson, Leslie A (DEC); Kruse, 1 • • • • • oil Oil & Gas Developme December 26, 2007 Mr. Steve Davies Alaska Oil & Gas Conservation District (Via Email: steve davies@admin.state.al.us) Re: Shallow Hazards Analysis Dear Mr. Davies: I have reviewed the seismic lines and geological well data in the North Alexander Prospect area and do not see any shallow geophysical hazards at the proposed well location about 2000' Studies by our Geophysist, Glen Jones, on our seismic lines did not find any zones of anomalous amplitudes above 2000'. In my review of well data, we expect almost 3000' of Quaternary sediments at the North Alexander well location charged with fresh water and no gas. Detail reviews were made on the Bell Island #1 well, the Cities Service Oil, E. Lewis River #1 well and the Unit 1 Isla Grande well. Yours truly, Frank Banar CC: Bruce D. Webb (brucewebb @gci.net) 5005 River way, Suite X110 . HoL,tOO Texas 77056 • Offic 7 ' 3 . 6 23.22'.9 • Fax: 713 x39.1205 • E rnao , escopetkcv.., 4,10 Page 1 of 1 Davies, Stephen F (DOA) From: Bruce D Webb [bwebb @aurorapower.com] Sent: Wednesday, December 26, 2007 9:08 AM To: Davies, Stephen F (DOA) Subject: FW: Shallow Hazards Analysis Good Morning Steve, Hope your Christmas went well. I received this note from Frank this morning, did you get anything from him (Escopeta mail) today? I have not. I also talked to Danny Davis, he indicated he would be working on the Bonding /Irrevocable Letter of Credit(s) today... two for DNR and one for the AOGCC. -Bruce From: frank banar [ mailto :frankbanar @sbcglobal.net} Sent: Wednesday, December 26, 2007 8:06 AM To: Bruce D Webb Subject: Re: Shallow Hazards Analysis My computer at home was not working. Today I wrote something on the shallow hazards at Escopeta's office to Steve and made a copy for you. It should go out today by E -mail. The stuff I sent you can go to the State if they want it...it just shows them that we have done alot of work with the data that we had. Bruce D Webb <bwebb@aurorapower.com> wrote: Frank, I received a package today containg multiple seismic plates, well logs and the N. Alexander Prospect Summary. I understand this information is in support of your analysis addressing any possible (or lack thereof) shallow geophysical hazards. Steve Davies needs some write up by you that indicates you have not seen any sags, bright spots, phase reversals, or anything else in the geological and geophysical information that might indicate the presence of abnormal gas pressures at a shallow depth. A brief discussion referencing well logs, velocity, or other information in support of a determination that no shallow geophysical hazards exist, or are not likely to be encountered, would also be helpful. An e-mail from you directly to Mr. Davies (address above) will be sufficient. Please include me in the cc distribution so I can have it for the records here. I will drop off the information you have sent to Mr. Davies and indicate it is confidential. Please advise if you require this package of information back, or if the AOGCC is suppose to file it with the N. Alexander well data. If you need to speak to Steve directly for any clarification, his direct phone number is (907) 793- 1224. Your time, expertise and assistance is greatly appreciated. -Bruce 12/31/2007 Kim M (DNR); Soderlund.Dianepamail.epa.gov; rockwell.theoe @epa.gov; Burgh.Colleen @epa.gov; tyonek @aitc.org; barbara.mahoney @noaa.gov; Mary_Nation @fws.gov; snainc @alaska.com; tkroto @tyonek.com; manny .lopez @enstarnaturalgas.com; Greene, Ben A (DNR); susan.lee @matsugov.us; Kukla, Alan F (DEC) Subject: N. Alexander photos, part 2 continued... 1 2 Page 1 of 1 • • Davies, Stephen F (DOA) From: Danny S. Davis [escopetaoil @gmail.com] Sent: Wednesday, December 26, 2007 8:38 AM To: steve_davies @admin.state.al.us Cc: brucewebb @gci.net Subject: Shallow Hollow Analysis Attachments: 12 -26 -07 SHALLOW HAZARDS ANALYSIS.pdf 12/27/2007 • I 4 4 • • 011 Gil & Gas Development December 26, 2007 Mr. Steve Davies Alaska Oil & Gas Conservation District (Via Email: Steve davies@admin.state.al.us) Re: Shallow Hazards Analysis Dear Mr. Davies: I have reviewed the seismic lines and geological well data in the North Alexander Prospect area and do not see any shallow geophysical hazards at the proposed well location about 2000' Studies by our Geophysist, Glen Jones, on our seismic lines did not find any zones of anomalous amplitudes above 2000'. In my review of well data, we expect almost 3000' of Quaternary sediments at the North Alexander well location charged with fresh water and no gas. Detail reviews were made on the Bell Island #1 well, the Cities Service Oil, E. Lewis River #1 well and the Unit 1 Isla Grande well. Yours truly, eart Frank Banar CC: Bruce D. Webb (brucewebb@gcimet) 5005 Riverway, Sulk. 4/10 Houston Texas /7050 . office. 713 623.2219 Fax 713,439.105 Ernaik escopeitnYsvibe ncr Page 1 of 1 i Davies, Stephen F (DOA) From: Bruce D Webb [bwebb@aurorapower.com] Sent: Wednesday, December 26, 2007 9:08 AM To: Davies, Stephen F (DOA) Subject: FW: Shallow Hazards Analysis Good Morning Steve, Hope your Christmas went well. I received this note from Frank this morning, did you get anything from him (Escopeta mail) today? I have not. I also I on the L tter of Credit toda ... talked to Danny Davis, he indicated he would be working o t e e (s ) y tw o for DNR and one for the AOGCC. -Bruce From: frank banar [ mailto:frankbanar@sbcglobal.net] Sent: Wednesday, December 26, 2007 8:06 AM To: Bruce D Webb Subject: Re: Shallow Hazards Analysis My computer at home was not working. Today I wrote something on the shallow hazards at Escopeta's office to Steve and made a copy for you. It should go out today by E -mail. The stuff I sent you can go to the State if they want it...it just shows them that we have done alot of work with the data that we had. Bruce D Webb <bwebb@aurorapower.com> wrote: Frank, I received a package today containg multiple seismic plates, well logs and the N. Alexander Prospect Summary. I understand this information is in support of your analysis addressing any possible (or lack thereof) shallow geophysical hazards. Steve Davies needs some write up by you that indicates you have not seen any sags, bright spots, phase reversals, or anything else in the geological and geophysical information that might indicate the presence of abnormal gas pressures at a shallow depth. A brief discussion referencing well logs, velocity, or other information in support of a determination that no shallow geophysical hazards exist, or are not likely to be encountered, would also be helpful. An e-mail from you directly to Mr. Davies (address above) will be sufficient. Please include me in the cc distribution so I can have it for the records here. I will drop off the information you have sent to Mr. Davies and indicate it is confidential. Please advise if you require this package of information back, or if the AOGCC is suppose to file it with the N. Alexander well data. If you need to speak to Steve directly for any clarification, his direct phone number is (907) 793- 1224. Your time, expertise and assistance is greatly appreciated. -Bruce 12/27/2007 s • Davies, Stephen F (DOA) From: Bruce Webb [brucewebb@gci.net] Sent: Wednesday, December 26, 2007 9:22 AM To: Davies, Stephen F (DOA); Davies, Stephen F (DOA) Cc: bwebb ©aurorapower.com Subject: Fwd: Shallow Hollow Analysis Attachments: ATT440259.htm; Shallow Hollow Analysis ATT440259.htm Shallow Hollow (462 B) Analysis Steve, Frank had your e -mail address wrong, attached is his letter. Please let me know if it is adequate. Thanks, -Bruce 1 Page 1 of 1 • 0 Davies, Stephen F (DOA) From: Danny S. Davis [escopetaoil @gmail.com] Sent: Wednesday, December 26, 2007 8:38 AM To: steve_davies c@admin.state.aius Cc: brucewebbc©gci.net Subject: Shallow Hollow Analysis Attachments: 12 -26 -07 SHALLOW HAZARDS ANALYSIS.pdf 12/27/2007 • • • 44 • , 01 Oil & Gas Development December 26, 2007 Mr. Steve Davies Alaska Oil & Gas Conservation District (Via Email: stove davies;a)admin.state.al.us) Re: Shallow Hazards Analysis Dear Mr. Davies: I have reviewed the seismic lines and geological well data in the North Alexander Prospect area and do not see any shallow geophysical hazards at the proposed well location about 2000' Studies by our Geophysist, Glen Jones, on our seismic lines did not find any zones of anomalous amplitudes above 2000'. In my review of well data, we expect almost 3000' of Quaternary sediments at the North Alexander well location charged with fresh water and no gas. Detail reviews were made on the Bell Island #1 well, the Cities Service Oil, E. Lewis River #1 well and the Unit 1 Isla Grande well. Yours truly, ' I / ; /G'� Frank Banar CC: Bruce D. Webb (brucewebb(a-gei.net) j s ' 5005 Riverway, Suite 440 • Haustal, Texas 77056 •OFfice: 713:623:2219 • Fax: 713 439.1205 • E-mail: escapetcs@swbeThnet • • Davies, Stephen F (DOA) From: Davies, Stephen F (DOA) Sent: Thursday, December 20, 2007 2:31 PM To: 'brucewebb@gci.net' Subject: FW: N. Alexander 1 -- Another Request Bruce, The Commission's standardized spacing exception application checklist contains the following question: "Does the application contain a brief explanation for why the operator has chosen to drill the specified location ?" Could you please have Escopeta provide an explanation as to why they have chosen to drill the proposed N. Alexander 1 gas exploratory well only 625 feet from a property line where ownership changes? The standard set -back from such a property line required by regulation 20 AAC 25.055(a)(2) is 1,500 feet. Thanks again for your help. Steve Davies AOGCC 907 - 793 -1224 Original Message From: Davies, Stephen F (DOA) Sent: Thursday, December 20, 2007 1:28 PM To: 'brucewebb @gci.net' Subject: N. Alexander 1 No Bond Yet from Escopeta I I Bruce, Just a reminder: the Commission still has not received a bond from Escopeta for the N. Alexander 1 well. Thanks, Steve Davies AOGCC 907 - 793 -1224 Original Message From: Davies, Stephen F (DOA) Sent: Tuesday, December 18, 2007 3:08 PM To: 'brucewebb @gci.net' Subject: RE: N. Alexander photos, part 2 Bruce: I haven't heard from Danny Davis or Escopeta about shallow hazards. Thanks, Steve Davies AOGCC Original Message From: Bruce Webb [mailto:brucewebb @gci.net] Sent: Wednesday, November 28, 2007 11:17 PM 1 To: Rader, Matthew W (DNR);41,the, Amber N (DFG); Delgado -PAIL, Josephina L (DNR) Cc: Irwin, Tom E (DNR); Banks, Kevin R (DNR); Taylor, Kenton P (DFG); Copoulos, Arthur E (DNR); Danny S. Davis; BRUCE @ AURORA; Mylius, Richard H (DNR); JColonell @entrix.com; Fogels, Edmund J (DNR); Farley, Kathleen M (JPO); Pexton, Scott R (JPO); Fink, Mark J (DFG); Maclean, Scott H (DNR); Marie, Megan E (DNR); Bettis, Patricia K (DNR); Bethune, Stephen W (DNR); Easton, John R (DNR); Goatley, Margie M (DNR); Davies, Stephen F (DOA); Combellick, Rod A (DNR); Silfven, Laurie A (DEC); Roche, Frances E (DEC); Krauss, Brenda K (DEC); Blankenburg, Robert J (DEC); Ryan, Sally A (DEC); Pearson, Leslie A (DEC); Kruse, Kim M (DNR); Soderlund .Dianne @epamail.epa.gov; rockwell.theodore@epa.gov; Burgh.Colleen @epa.gov; tyonek @aitc.org; barbara.mahoney @noaa.gov; Mary_Nation @fws.gov; snainc @alaska.com; tkroto @tyonek.com; manny .lopez @enstarnaturalgas.com; Greene, Ben A (DNR); susan.lee @matsugov.us; Kukla, Alan F (DEC) Subject: N. Alexander photos, part 2 continued... 2 • Davies, Stephen F (DOA) From: Davies, Stephen F (DOA) Sent: Thursday, December 20, 2007 1:28 PM To: 'brucewebb @gci.net' Subject: N. Alexander 1 -- No Bond Yet from Escopeta Bruce, Just a reminder: the Commission still has not received a bond from Escopeta for the N. Alexander 1 well. Thanks, Steve Davies AOGCC 907 - 793 -1224 Original Message From: Davies, Stephen F (DOA) Sent: Tuesday, December 18, 2007 3:08 PM To: 'brucewebb @gci.net' Subject: RE: N. Alexander photos, part 2 Bruce: I haven't heard from Danny Davis or Escopeta about shallow hazards. Thanks, Steve Davies AOGCC Original Message From: Bruce Webb [mailto:brucewebb @ gci.net] Sent: Wednesday, November 28, 2007 11:17 PM To: Rader, Matthew W (DNR); Bethe, Amber N (DFG); Delgado - Plikat, Josephina L (DNR) Cc: Irwin, Tom E (DNR); Banks, Kevin R (DNR); Taylor, Kenton P (DFG); Copoulos, Arthur E (DNR); Danny S. Davis; BRUCE @ AURORA; Mylius, Richard H (DNR); JColonell @entrix.com; Fogels, Edmund J (DNR); Farley, Kathleen M (JPO); Pexton, Scott R (JPO); Fink, Mark J (DFG); Maclean, Scott H (DNR); Marie, Megan E (DNR); Bettis, Patricia K (DNR); Bethune, Stephen W (DNR); Easton, John R (DNR); Goatley, Margie M (DNR); Davies, Stephen F (DOA); Combellick, Rod A (DNR); Silfven, Laurie A (DEC); Roche, Frances E (DEC); Krauss, Brenda K (DEC); Blankenburg, Robert J (DEC); Ryan, Sally A (DEC); Pearson, Leslie A (DEC); Kruse, Kim M (DNR); Soderlund .Dianne @epamail.epa.gov; rockwell.theodore @epa.gov; Burgh.Colleen @epa.gov; tyonek @aitc.org; barbara.mahoney @noaa.gov; Mary_Nation @fws.gov; snainc @alaska.com; tkroto @tyonek.com; manny.lopez @enstarnaturalgas.com; Greene, Ben A (DNR); susan.lee @matsugov.us; Kukla, Alan F (DEC) Subject: N. Alexander photos, part 2 continued... 1 Page 1 of 1 • • Davies, Stephen F (DOA) From: Bruce D Webb [bwebb @aurorapower.com] Sent: Thursday, December 20, 2007 12:07 PM To: Frank Banar; Danny S. Davis Cc: Davies, Stephen F (DOA); home office Subject: Shallow Hazards Analysis Frank, I received a package today containg multiple seismic plates, well logs and the N. Alexander Prospect Summary. I understand this information is in support of your analysis addressing any possible (or lack thereof) shallow geophysical hazards. Steve Davies needs some write up by you that indicates you have not seen any sags, bright spots, phase reversals, or anything else in the geological and geophysical information that might indicate the presence of abnormal gas pressures at a shallow depth. A brief discussion referencing well logs, velocity, or other information in support of a determination that no shallow geophysical hazards exist, or are not likely to be encountered, would also be helpful. An e-mail from you directly to Mr. Davies (address above) will be sufficient. Please include me in the cc distribution so I can have it for the records here. I will drop off the information you have sent to Mr. Davies and indicate it is confidential. Please advise if you require this package of information back, or if the AOGCC is suppose to file it with the N. Alexander well data. If you need to speak to Steve directly for any clarification, his direct phone number is (907) 793- 1224. Your time, expertise and assistance is greatly appreciated. -Bruce 12/20/2007 Page 1 of 2 i 4 Davies, Stephen F (DOA) From: Bruce D Webb [bwebb @aurorapower.com] Sent: Tuesday, December 18, 2007 3:34 PM To: Davies, Stephen F (DOA) Subject: FW: AOGCC Shallow Geophysical Hazards Analysis Hi Steve, I was thinking that myself earlier, and called Danny. He said to re -email him the info and he would have his geologist, Frank Banar, work on it tomorrow. Thanks for the reminder though! Happy Holidays, -Bruce From: Bruce D Webb [mailto:bwebb @aurorapower.com] Sent: Tuesday, December 18, 2007 1:05 PM To: 'Bruce Webb'; 'Escopeta Oil' Cc: Frank Banar (frankbanar @escopetaoil.com) Subject: RE: AOGCC Shallow Geophysical Hazards Analysis Need this before the end of the year, if possible Original Message From: Bruce Webb [mailto:brucewebb @gci.net] Sent: Thursday, December 06, 2007 1:42 PM To: Escopeta Oil Cc: bwebb @aurorapower.com Subject: AOGCC Bonding and Shallow Geophysical Havards Danny, I spoke to Steve Davies at the AOGCC, they need a shallow hazards analysis for the N. Alexander No. Well in accordance to: 20 AAC 25.061. Well site surveys (a) For an exploratory or stratigraphic test well, near surface strata to a depth of 2,000 feet in the vicinity of the well must be evaluated seismically by common depth point refraction or reflection profile analysis, or by another method approved by the commission, to identify anomalous velocity variations indicative of potential shallow gas sources. Analysis results must be included with the application for the Permit to Drill (Form 10 -401). (b) For a well drilled offshore from a mobile bottom - founded structure, jack -up rig, or floating drilling vessel, the vicinity of the well must be evaluated by sidescan sonar and other pertinent surveys to determine whether potential seabed hazards to drilling operations are present. Survey results must be included with the application for Permit to Drill. (c) Upon request by the operator, the commission will, in its discretion, waive the requirements of this section if the operator can identify, by other equally effective means, the likelihood of encountering potential shallow gas or seabed hazards or if the commission already has information that substantiates the presence or absence of shallow gas or seabed hazards. History: Eff. 4/13/80, Register 74; am 4/2/86, Register 97; am 11/7/99, Register 152 12/20/2007 Page 2 of 2 • Original Message From: Escopeta Oil <escopeta @swbell.net> Date: Thursday, December 6, 2007 12:55 pm Subject: MESSAGE To: "BRUCE D. WEBB" <brucewebb @gci.net> > Bruce: > I left you a voice message while you were out to lunch and I > wanted to make > sure you get it so I am emailing it also. > 12/6/07 > 3:49 pm > Mr. Steve Davies > Alaska Oil & Gas Conservation District > 907 - 793 -1224 > Re: Permitting and Bonding > Thank you, > Carol > Escopeta Oil > 713 - 623 -2219 12/20/2007 1 • Davies, Stephen F (DOA) From: Davies, Stephen F (DOA) Sent: Tuesday, December 18, 2007 3:08 PM To: 'brucewebb @gci.net' Subject: RE: N. Alexander photos, part 2 Bruce: I haven't heard from Danny Davis or Escopeta about shallow hazards. Thanks, Steve Davies AOGCC Original Message From: Bruce Webb [mailto:brucewebb @gci.net] Sent: Wednesday, November 28, 2007 11:17 PM To: Rader, Matthew W (DNR); Bethe, Amber N (DFG); Delgado - Plikat, Josephina L (DNR) Cc: Irwin, Tom E (DNR); Banks, Kevin R (DNR); Taylor, Kenton P (DFG); Copoulos, Arthur E (DNR); Danny S. Davis; BRUCE @ AURORA; Mylius, Richard H (DNR); JColonell @entrix.com; Fogels, Edmund J (DNR); Farley, Kathleen M (JPO); Pexton, Scott R (JPO); Fink, Mark J (DFG); Maclean, Scott H (DNR); Marie, Megan E (DNR); Bettis, Patricia K (DNR); Bethune, Stephen W (DNR); Easton, John R (DNR); Goatley, Margie M (DNR); Davies, Stephen F (DOA); Combellick, Rod A (DNR); Silfven, Laurie A (DEC); Roche, Frances E (DEC); Krauss, Brenda K (DEC); Blankenburg, Robert J (DEC); Ryan, Sally A (DEC); Pearson, Leslie A (DEC); Kruse, Kim M (DNR); Soderlund .Dianne @epamail.epa.gov; rockwell.theodore @epa.gov; Burgh.Colleen @epa.gov; tyonek @aitc.org; barbara.mahoney @noaa.gov; Mary_Nation @fws.gov; snainc @alaska.com; tkroto @tyonek.com; manny.lopez @enstarnaturalgas.com; Greene, Ben A (DNR); susan.lee @matsugov.us; Kukla, Alan F (DEC) Subject: N. Alexander photos, part 2 continued... 1 Page 1 of 2 • • Davies, Stephen F (DOA) From: Bruce D Webb [bwebb @aurorapower.com] Sent: Friday, December 07, 2007 2:52 PM To: Danny S. Davis Cc: home office; Davies, Stephen F (DOA); Copoulos, Arthur E (DNR); Banks, Kevin R (DNR); Gibson, Kurtis K (DNR); susan.lee @matsugov.us Subject: FW: DOG Comments Escopeta North Alexander No. 1 Attachments: DOG ACMP Comment North Alex .pdf; North Alexander #1.pdf; 12.07.07 revised NAU Permit Update.doc Danny, Only one left to comment is the Mat -Su Borough... I have not heard from them, but don't anticipate any upset from the borough. The AOGCC Hearing Notice for the Spacing Exception went out today — the public hearing is scheduled for January 10 but the hearing will be cancelled if no one comments or requests it to be held by 12/26. So, the Spacing Exception and Permit to Drill will be issued the week after January 10 Don't forget to have Frank look at the seismic data and prepare a Shallow Hazards Analysis before the end of the year — you will want that submitted before the current POE deadline, even though the AOGCC cannot issue the permits until after the 10 of January. IF the DNR modifies at least the first part of the POE to allow the Unit to not automatically terminate on 12/31/07, I would suggest having the appropriate bonding in place by Friday the 28 assuming you get an indication that the Unit will continue before then. This will give the DNR and the AOGCC a week, and two weeks, respectively, to confirm the Letter of Credit and issue their permits. As I said last week, it's really out of your hands now and up to the DNR to decide if they want you to drill this well. It's coming down to the wire. I will keep you posted. -Bruce From: Rader, Matthew W (DNR) [mailto:matt.rader @alaska.gov] Sent: Friday, December 07, 2007 2:19 PM To: Delgado - Plikat, Josephina L (DNR) Cc: Mark Fink - DFG; Greene, Ben A (DNR); Susan Lee - MSB; Bruce D. Webb - Aurora; Faye Sullivan - Chevron; manny.Iopez - Enstar Pipeline; Silfven, Laurie A (DEC); Bethune, Stephen W (DNR); Mike Bethe - DNR OHMP; Bethe, Amber N (DFG) Subject: DOG Comments Escopeta North Alexander No. 1 Jodi, Division of Oil and Gas ACMP consistency comments are attached. Matt Rader Phone 907 269 -8776 Fax 907 269 -8938 DNR DO &G PSIO /Permitting Attn. Matt Rader 550 West 7th Ave #800 Anchorage, Alaska 99501 12/20/2007 Page 2 of 2 • http://www.dog.dnr.state.ak.us/oil/ http: / /www.dog.d n r. state. ak. us /oiI/ programs /permitting /permitting. htm 12/20/2007 Page 1 of 2 • Davies, Stephen F (DOA) From: Bruce D Webb [bwebb @aurorapower.com] Sent: Thursday, December 06, 2007 5:25 PM To: Delgado - Plikat, Josephina L (DNR) Cc: home office; Danny S. Davis; Banks, Kevin R (DNR); Gibson, Kurtis K (DNR); Copoulos, Arthur E (DNR); Bethune, Stephen W (DNR); Rader, Matthew W (DNR); susan.Iee @matsugov.us; Maclean, Scott H (DNR); Davies, Stephen F (DOA); Bethe, Amber N (DFG); Taylor, Kenton P (DFG); Irwin, Tom E (DNR) Subject: FW: Escopeta North Alexander Exploration Project ACMP Review Re -start Attachments: Escopeta_North Alexander Prospect_Review Restart.pdf; 12.07.07 NAU Permit Update.doc Josephina, I wanted to thank you for your expedient handling of this review. Although it was delayed, the Final Consistency is scheduled to be issued on December 31, 2007, as I had assumed last week. Despite the Unit Plan of Exploration requiring that ALL permits be issued on this date, I believe the DNR Division of Oil and Gas will show some lenience in not automatically terminating the Unit for failure of not having ALL permits in place by 12/31/07. After checking with the indivivals working on the remaining authorizations that are needed, I have determined that only the four (4) State agencies in red on the attached summary are dependent on the Final Consistency Determination. It is my understaning, as indicated in the public notice dated 10/29/07 that: "State agencies shall issue permits within five days after the OPMP issues the Final Consistency Determination that concurs with the Applicant's [Escopeta Oil Company LLCg consistency certification, unless the resource agency considers additional time to be necessary to fulfill its statutory or regulatory authority." 11 AAC 112.200 —11 AAC 112 990. I do realize that there may be ONE agency that will probably require "additional time ", but hopefully, the Division of Oil and Gas will consider the diligent effort put forth by Escopeta in obtaining the required permits by the deadline. Again, thank you for your patience, understanding and assistance... it has been greatly appreciated. Have a wonderful holiday season. Respectfully, -Bruce From: Delgado - Plikat, Josephina L (DNR) [mailto:josephina .delgado- plikat @alaska.gov] Sent: Thursday, December 06, 2007 4:19 PM To: Bruce D Webb Cc: Kukla, Alan F (DEC); Bethe, Amber N (DFG); Farley, Kathleen M (JPO); Pexton, Scott R (JPO); Fink, Mark J (DFG); Maclean, Scott H (DNR); Marie, Megan E (DNR); Bettis, Patricia K (DNR); Bethune, Stephen W (DNR); Rader, Matthew W (DNR); Easton, John R (DNR); Goatley, Margie M (DNR); Davies, Stephen F (DOA); susan.lee @matsugov.us; Combellick, Rod A (DNR); Silfven, Laurie A (DEC); Roche, Frances E (DEC); Krauss, Brenda K (DEC); Blankenburg, Robert J (DEC); Ryan, Sally A (DEC); Pearson, Leslie A (DEC); Soderlund .Dianne @epamail.epa.gov; rockwell.theodore @epa.gov; Burgh.Colleen @epa.gov; tyonek @aitc.org; barbara.mahoney @noaa.gov; Mary_Nation @fws.gov; Wade.Wilson @matsugov.us; Bruce.Paulsen @matsugov.us; snainc @alaska.com; tkroto @tyonek.com; manny.lopez@enstarnaturalgas.com; Greene, Ben A (DNR); ppourchot @audubon.org Subject: Escopeta North Alexander Exploration Project ACMP Review Re -start Attached is the ACMP Review Restart letter for the Escopeta North Alexander #1 Exploration Well project. Jodi Delgado - Plikat Oil and Gas Project Review Coordinator /JPO Liaison 550 West 7th Avenue, Suite 705 Anchorage, AK 99501 -3568 12/20/2007 Page 2 of 2 Tel: 269 -7472 12/20/2007 III 410 Davies, Stephen F (DOA) From: Bruce Webb [brucewebb @gci.net] Sent: Wednesday, December 05, 2007 2:52 PM To: Davies, Stephen F (DOA); Rader, Matthew W (DNR); Bethune, Stephen W (DNR); Maclean, Scott H (DNR); Pearson, Leslie A (DEC); Roby, David S (DOA); slee @matsugov.ak Cc: escopeta @swbell.net; bwebb @aurorapower.com; Copoulos, Arthur E (DNR) Subject: Progress of N. Aexander #1 permits Attachments: 12.5.07 NAU Permit Update.doc 1 12.5.07 NAU Permit Update.doc... All, Following is a list of people who I believe are working on the remaining permits, or pieces to the aboved referenced winter exploration project. This list does not include Amber Bethe with the SFSGR section of Fish and Game, as I know where they stand in the Special Areas Permit process. Steve Davies, AOGCC Permit to Drill and Spacing Exception Matt Rader, DNR Unit Plan of Operations Approval Stephen Bethune, DNR Temporary Land Use Permit Dave Roby, AOGCC ODPCP exemption for gas well Leslie Pearson, ADEC ODPCP exemption for gas well Scot MacLean, OHMP Title 41 Fish Habitat Permit Susan Lee, MatSu Bor. Land Use Permit I would like to know where each of you are in the process for isuing your respective permits, and whether or not you believe you permits cannot be issued until the Final Consisteny Determination is issued. Many of the required ermits have already been issued, a table detailing the permis is attached for your reference. As you know the North Alexander Unit and underlying leases are subject to a Plan of Exploration that is approved by the DNR. The First Year work commitment REQUIRES that ALL permits are ISSUED and evidenced to the DNR by 5 pm on December 31, 2007. The Plan of Exploation stipulates taht is the permits are not ISSUED (as opposed to being applied for) the unit will automatically terminate. The ACMP 50 -day review clock was stopped on day -25 by the ADF &G or an inconsequential information request. By regulation, the ADF &G has seven days to respond back to the OPMP office and indicate whether or not the additional information I had supplied was adequate. This seven day period expires on Friday the 7th of December. Wether or not the ADF &G's response is fovorable or negative, if the ACMP clock is simultaneously restarted on the 7th, the remaining 25 days left in the ACMP review will put the Final Consitency Determination at December 31st.... not leaving any resource agency any time to get their permis issued before the North Alexander Unit automatically terminates. By regulation, agencies have five (5) days to issue their permits after the Consistency Determination, I fully expect the ADF &G to take that entire five days as well. As you can see, timing is of the essence. If your individual permits ARE NOT dependent on the ACMP Final Consistency Determination, and you have the ability to issue them irrespective of that determination, please let me know and indicate when you anticipate issuance. Your time and consideration is greaty appreciated. Best Regards, -Bruce Webb, for Escopeta Oil Company LLC 1 • Davies, Stephen F (DOA) From: Bruce Webb [brucewebb @gci.net] Sent: Wednesday, November 28, 2007 11:17 PM To: Rader, Matthew W (DNR); Bethe, Amber N (DFG); Delgado- Plikat, Josephina L (DNR) Cc: Irwin, Tom E (DNR); Banks, Kevin R (DNR); Taylor, Kenton P (DFG); Copoulos, Arthur E (DNR); Danny S. Davis; BRUCE @ AURORA; Mylius, Richard H (DNR); JColonell @entrix.com; Fogels, Edmund J (DNR); Farley, Kathleen M (JPO); Pexton, Scott R (JPO); Fink, Mark J (DFG); Maclean, Scott H (DNR); Marie, Megan E (DNR); Bettis, Patricia K (DNR); Bethune, Stephen W (DNR); Easton, John R (DNR); Goatley, Margie M (DNR); Davies, Stephen F (DOA); Combellick, Rod A (DNR); Silfven, Laurie A (DEC); Roche, Frances E (DEC); Krauss, Brenda K (DEC); Blankenburg, Robert J (DEC); Ryan, Sally A (DEC); Pearson, Leslie A (DEC); Kruse, Kim M (DNR); Soderlund .Dianne @epamail.epa.gov; rockwell.theodore a a. ov; Bur h.Colleen a a. ov; onek aitc.or @ P 9 9 @ P 9 tY ; @ 9 barbara.mahoney @noaa.gov; Mary_Nation @fws.gov; snainc @alaska.com; tkroto @tyonek.com; manny.lopez@enstarnaturalgas.com; Greene, Ben A (DNR); susan.lee @matsugov.us; Kukla, Alan F (DEC) Subject: N. Alexander photos, part 2 Attachments: N. Alexander looking northwest.jpg; N. Alexander looking southl.jpg; N. Alexander looking south2.jpg; N. Alexander looking south.jpg; N. Alexander with Susitna.jpg N. Alexander N. Alexander N. Alexander N. Alexander N. Alexander with looking northwest...looking southl.jp... looking south2.jp... looking south.jpg... Susitna.jpg ... continued... 2 North Alexander Permitting Status as of December 5, 2007 Agency/ Applications for Permit Status Division Reviews, Approvals ADNR/DOG Unit Application and Plan of Exploration Completed, minor amendment request may be foliowing ADNR/D0G Unit PIan of Operations w/ Project Timeline Application submitted October 8.2OO7— part of ACMP review, Day 1 was 102907 ADNR/OPMP ACMP Review & Coastal Project Questionnaire Documents and CPQ submitted October 8, 2007, ACMP review Day 1 was 102907 ADNR/DLM&W Temporary Land Use Permit Application submitted October 0.2OO7— part nf ACMP review, Day 1 was 102907 ADNR/DLM&W Temporary Water Use Permit Completed, Permit tssued �N�� �� ADNR/8HPO Archeological Sumey/Comp|iano*Lo�orRepo� Completed, Leup,ofnon-oL4ecbnnreceived `�' AOGCC Permit to Drill and Spacing Exception Applications submitted November 15, 2007 AOGCC Concurrence Gas Exception Determination Application submitted October 8, 2007, reviewed concurrently with DEC ADEC/Solid Waste Temporary Waste Storage Plan Completed, Permit lssued EPA Spill Prevention Contm|& Countermeasure Plan Completed, Permit issued ADEC/SPAR Request for Spill Plan (ODPCP)Exception Application submitted October 8, 2007, reviewed concurrently with AOGCC ADEC/AQ Air Quaiity Control Minor General Permit (MGP1) Completed, Permit Issued ADF&G/SFSGR Special Area Permit for fieldwork in SFSGR Completed ADF&G/SFSGR Special Area Permit for drilling in SFSGR Application submitted October 8, 2007 — part of ACMP review, Day 1 was 10/29/07 ADNR/OHMP Title 41 Fish Habitat Permit Application submitted October 8, 2007 — part of ACMP review, Day 1 was 10/29/07 EPA NPDES Permit for Gray-Water Discharge Rig camp is in Boluga, camp owners already are permitted ill EPA NPDES Permit for Wator Maker Discharge Not applicable, water for ice roads is proposed from rivers and lakes only USACE Notification for Title 6 Nationwide Permit Not applicable, no seismic survey activities are planned or anticipated USACE Letters af Exemption from Sections 10 and 404 Connp|utnd, Permit issued, Letter of non-objection received ROW Access Letter of No Objection Notification letters toENSTAR.CEAand Chevron submitted, approval not req'd. , Mat/SuBomugx ACMP Process and Review Application submitted October 8, 2007 — part of ACMP review, Day 1 was 10/29/07 LJ d LJ D ► ► SARAH PALIN GOVERNOR DEPARTMENT OF NATURAL RESOURCES DIVISION OF COASTAL AND OCEAN MANAGEMENT iutp://www.alaskacoast_state.ak.us My SOUTHCENTRAL REGIONAL OFFICE 0CENTRAL OFFICE 0 PIPELINE COORDINATOR'S OFFICE 550 W. 7 AVENUE, SUITE 705 P.O. BOX 111030 411 WEST 4"' AVENUE. SUITE 2C ANCHORAGE, ALASKA 99501 JUNEAU, ALASKA 99811 -1030 ANCHORAGE, ALASKA 99501 -2343 PH: (907) 269 -7470 /FAX: (907) 269 -3981 PH: (907) 465 -3562 /FAX (907) 465 -3075 PH: (907) 257 -1351 /FAX (907) 272 -3829 November 26, 2007 Bruce Webb, Webb Petroleum Services — representing— Escopeta Oil Company, LLC P.O. Box 13141 Anchorage, AK 99511 -3141 Subject: Escopeta 2007 -2008 Exploration Drilling: North Alexander Prospect (SFSGR) State ID NO. AK 0711-010G Request For Additional Information / Suspension of ACMP review Dear Mr. Webb: Pursuant to the State of Alaska's review of the above referenced proposed activity for consistency with the Alaska Coastal Management Program (ACMP), the Division of Coastal and Ocean Management (DCOM) has received a request for additional information (RFAI) per 11 AAC 110.240(a) from the Alaska Department of Fish and Game (ADF &G). This request from the ADF &G asks the DCOM, within the context of the Coastal Consistency review for Escopeta's 2007 -2008 Exploration Drilling in the North Alexander prospect proposal, for additional information to determine if the proposed project is consistent with the ACMP. The proposed project would drill and test a single, onshore natural gas exploration well in its North Alexander prospect during the winter of 2007 -2008. The North Alexander Unit is within the Susitna Flats State Game Refuge (SFSGR). The proposed exploration well is located on state land in Section 22, T. 15N, R. 08 W., Seward Meridian. Operations are proposed to occur in late December, 2007 and January, 2008. The 22,882 acre prospect is located onshore on state oil and gas leases within the Susitna Flats State Game Refuge. The SFSGR was established by the Alaska Legislature to protect the following: 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 • 1 Escopeta 2007 -2008 Exploration Drilling November 26, 2007 AK 0711-010G Page2 Request for additional Information hunting; viewing; photography; and general public recreation in a high quality environment. Multiple land use activities on the SFSGR may be allowed if the proposed action provides for the proper protection of fish and wildlife resources and does not adversely impact important habitat values, fish or wildlife populations, or public recreational opportunities. The project proposal does not include all of the information necessary to assure compliance with Habitat Standard at 11 AAC 11 2.300. Consequently, ADF &G requests that the applicant submit the following information: 1. On- the - ground photos of the proposed North Alexander exploratory drilling site 2. Site plans for the drilling pad 3. Detailed information about the bridge crossing at Ivan River, including the width of the river at that location. 4. Additional information regarding in- stream flow in the Ivan, Lewis and Theodore Rivers. The applicant has provided a maximum withdrawal rate of 1,700 gallons per minute, or 3.78 cubic feet per second. This may be a significant percentage of available water; information is needed to fully assess the impact of these withdrawals. The purpose of this letter is to a) distribute this RFAI written request to review participants and b) to suspend the State ACMP review, per 11 AAC 270(a) (7), as of today, November 26, 2007 on day -25 of the state's 50 -day review. Resolution of ADF &G questions, which may have direct and consequential implications for the scope of this review, must be resolved in advance of restarting the review. Upon resolution of this request, I will restart the review on day -26 of 50, and the public comment deadline will occur on day -30, 4 days after the review is restarted. ADF& G will notify the requestor within seven days from when the applicant provides the requested information whether the information is adequate or inadequate for the review to restart. Once it has been determined that the applicant has satisfied the RFAI the review will be re- started immediately. If you have questions regarding the request for additional information, please contact me at (907)269 -7472 or email josephina .delgado- plikat @alaska.gov. Sincerely, Jodi Delagdo - Plikat Oil and Gas Project Review Coordinator Enclosure • • Escopeta 2007 -2008 Exploration Drilling November 26, 2007 AK 0711-010G Page3 Request for additional Information Cc: Scott Pexton; Katie Farley; Dennis Gnath; Mike Thompson, JPO Irwin (Skip) Joy; Jack Hewitt; Mike Holley, USACE Mark Fink; Amber Bethe, ADF &G Scott Maclean; Megan Marie, DNR/ OHMP Patricia Bettis; Steven Bethune, ADNR/DML &W Matt Rader; John Easton, DNR, DOG Margie Goatley, ADNR/DPOR/SHPO Stephen Davies, AOGCC Susan Lee, Matanuska - Susitna Borough Rod Combellick, DNR, Division of Geological & Geophysical Surveys Ben Greene, DNR, OPMP Laurie Silfven; Fran Roche; Brenda Krauss; Bob Blankenburg; Sally Ryan, Leslie Pearson; Cynthia Espinoza; Allan Kukla, DEC Dianne Soderlund; Ted Rockwell; Colleen Burgh, EPA Peter Merryman, President, Native Village of Tyonek (IRA) [via FAX 907 -583 -2442] Jaison Standifer, President, Tyonek Native Corporation [via FAX 907 - 274 -7125] Barbara Mahoney, NMFS/NOAA Mary Lynn Nation, USFWS Wade Wilson, MSB, Right -Of -Way Specialist Bruce Paulsen, MSB, Trails & Land Management Specialist Theresa Ressler, CIRI Penny Carty, Salamatof Native Assn. Ted Kroto, Tyonek Native Corp. Manny Lopez, Alaska Pipeline Company/ ENSTAR Page l of l • Davies, Stephen F (DOA) From: Bruce D Webb [bwebb @aurorapower.com] Sent: Thursday, November 29, 2007 8:57 AM To: Rader, Matthew W (DNR); Bethe, Amber N (DFG); Delgado- Plikat, Josephina L (DNR) Cc: Irwin, Tom E (DNR); Banks, Kevin R (DNR); Taylor, Kenton P (DFG); Copoulos, Arthur E (DNR); 'Danny S. Davis'; Mylius, Richard H (DNR); JColonell @entrix.com; Fogels, Edmund J (DNR); Farley, Kathleen M (JPO); Pexton, Scott R (JPO); Fink, Mark J (DFG); Maclean, Scott H (DNR); Marie, Megan E (DNR); Bettis, Patricia K (DNR); Bethune, Stephen W (DNR); Easton, John R (DNR); Goatley, Margie M (DNR); Davies, Stephen F (DOA); Combellick, Rod A (DNR); Silfven, Laurie A (DEC); Roche, Frances E (DEC); Krauss, Brenda K (DEC); Blankenburg, Robert J (DEC); Ryan, Sally A (DEC); Pearson, Leslie A (DEC); Kruse, Kim M (DNR); Soderlund .Dianne @epamail.epa.gov; rockwell.theodore @epa.gov; Burgh.Colleen @epa.gov; tyonek @aitc.org; barbara.mahoney @noaa.gov; Mary_Nation @fws.gov; snainc @alaska.com; tkroto @tyonek.com; manny .lopez @enstarnaturalgas.com; Greene, Ben A (DNR); susan.lee @matsugov.us; Kukla, Alan F (DEC) Subject: RE: N. Alexander photos If some of you received the e-mails of the N. Alexander and Ivan River photos more than once, I apologize. The server kept timing out last night while sending them due to the file size. I had to separate out the photos in multiple a -mails and re -send them in order to assure all recipients got them. 12/20/2007 Page 1 of 1 • Davies, Stephen F (DOA) From: Bruce D Webb [bwebb @aurorapower.com] Sent: Monday, November 26, 2007 3:33 PM To: 'Jeff D. Miller'; 'RCrotty'; Danny S. Davis; home office Cc: Irwin, Tom E (DNR); Banks, Kevin R (DNR); Taylor, Kenton P (DFG); Copoulos, Arthur E (DNR); Mylius, Richard H (DNR); JColonell @entrix.com; Delgado- Plikat, Josephina L (DNR); Fogels, Edmund J (DNR); Bethe, Amber N (DFG); Farley, Kathleen M (JPO); Pexton, Scott R (JPO); Fink, Mark J (DFG); Maclean, Scott H (DNR); Marie, Megan E (DNR); Bettis, Patricia K (DNR); Bethune, Stephen W (DNR); Rader, Matthew W (DNR); Easton, John R (DNR); Goatley, Margie M (DNR); Davies, Stephen F (DOA); Combellick, Rod A (DNR); Silfven, Laurie A (DEC); Roche, Frances E (DEC); Krauss, Brenda K (DEC); Blankenburg, Robert J (DEC); Ryan, Sally A (DEC); Pearson, Leslie A (DEC); Kruse, Kim M (DNR); Soderlund .Dianne @epamail.epa.gov; rockwell.theodore @ epa.gov; Burgh.Colleen @epa.gov; tyonek @aitc.org; barbara.mahoney @noaa.gov; Mary_Nation @fws.gov; snainc @alaska.com; tkroto @tyonek.com; manny.lopez@enstarnaturalgas.com; Greene, Ben A (DNR); susan.lee @matsugov.us; Kukla, Alan F (DEC) Subject: North Alexander ACMP Review Attachments: Escopeta_North Alexander Prospect #1 RFAI Suspend.pdf Rob and Jeff, I hope your Thanksgiving Holiday was enjoyable! I know I have bothered you probably enough in the past about this project, but the DNR has STOPPED the ACMP review of the project pending additional information requests by the Department of Fish and Game (ADF &G). The Plan of Exploration currently requires Escopeta to have ALL the permits issued by 12/31/07 — which only gives about a week AT THE MOST to get the required data, or Escopeta risks having the leases taken away. When Entrix was working on this project with Cruz Construction, I was told there were site visits made by helicopter with a representative from Fish and Game. Does Entrix or Cruz Construction have any site photos, field notes, names of contact people who visited the site with you, or information on the stream flows of the Ivan, Theodore r Lewis Rivers? I am in contact with the Hydrologic section of the Division of Mining, Land and Water, the USGS, ConocoPhillips and Chevron as well. In addition to the information request by the ADF &G, the Division of Oil and Gas has requested 10 informational items, some similar to the ADF &G. Jeff, I also need some information on the portable bridge we talked about over breakfast, that could be used to span rivers such as the Ivan, Lewis and Theodore. Your immediate assistance, or any information, would be greatly appreciated. Regards, Bruce D. Webb Manager, Land and Regulatory Affairs Aurora Gas, LLC 1400 W. Benson Blvd., Suite 410 Anchorage, AK 99503 (907) 277 -1003 office (907) 229 -8398 cell (970) 277 -1006 fax 12/20/2007 Page 1 of 2 • . Davies, Stephen F (DOA) From: Davies, Stephen F (DOA) Sent: Wednesday, November 14, 2007 1:10 PM To: Bruce D Webb Subject: RE: spacing exception v. permit to drill Bruce, Regulation 20 AAC 25.025(a) starts by stating: "An operator proposing to drill a well for which a permit is required under 20 AAC 25.005 shall file a bond and, if required under (2) of this subsection, security to ensure that each well is drilled, operated, maintained, repaired, and abandoned and each location is cleared in accordance with this chapter...". Commission senior staff uses a standardized checklist during our review of every permit to drill application. One of the questions on that checklist is: "Operator has appropriate bond in force ?" So, permit to drill applications cannot be approved before a bond has been filed and approved by the Commission. Ownership /operator records must also be complete prior to approval. I also handle bonding, and Escopeta does not have one in place with the AOGCC. Steve Davies AOGCC 793 -1224 From: Bruce D Webb [mailto:bwebb©aurorapower.com] Sent: Tuesday, November 13, 2007 4:51 PM To: Davies, Stephen F (DOA) Subject: RE: spacing exception v. permit to drill Thanks again Steve, It looks like Escopeta has everything, except maybe the Bond. Danny Davis will be here tomorrow to meet with Dave Boelens and myself and I will ask him. Is there a database or individual at AOGCC I can check with as well, to verify (not that I wouldn't believe Danny Davis). I assume they need the bond in place — first — for the permit to drill, and cannot have the permit contingent on a bond prior to drilling activities, or could they? -Bruce Bruce D. Webb Manager, Land and Regulatory Affairs Aurora Gas, LLC 1400 W. Benson Blvd., Suite 410 Anchorage, AK 99503 (907) 277 -1003 office (907) 229 -8398 cell (970) 277 -1006 fax From: Davies, Stephen F (DOA) [mailto:steve.davies @alaska.gov] Sent: Tuesday, November 13, 2007 3:15 PM To: Bruce D Webb Subject: RE: spacing exception v. permit to drill Bruce, 12/20/2007 Page 2 of 2 Yes, Escopeta can submit the applic411/n in advance of the permit to drill so long •scopeta: 1. owns the lease upon which operations are proposed, 2. has submitted any required change of ownership and designation of operator forms for the affected lease(s), 3. has a bond in place with the Commission, and 4. Provides enough information for the Commission to publish a notice in the newspaper and online, such as: • surface and bottom hole locations, • which section(s) of 20 AAC 25.055 need exceptions, and • why the exceptions are needed (too close to lease line, too close to nearby well, second well in governmental section or quarter - section, etc.) Please let me know if you have additional questions. Steve Davies AOGCC 793 -1224 From: Bruce D Webb [mailto:bwebb @aurorapower.com] Sent: Tuesday, November 13, 2007 9:31 AM To: Davies, Stephen F (DOA) Subject: spacing exception v. permit to drill Good morning Steve, I am helping Escopeta with their N. Alexander No. 1 well. They have decided to drill it only 625' from the section line. According to the DNR Unit Plan of Exploration commitments require all permits to be in place by December 31St. I know the Spacing Exceptions take about 45 days, and the Permit to Drill only a couple weeks. The engineer working up the drilling /casing /cementing /mud plan is traveling for about a week, and I need to get the ball rolling in the right direction. Is it possible to submit the Spacing Exception Application in advance of the Permit to Drill (by a couple weeks)? Thank you once again for your guidance. Bruce D. Webb Manager, Land and Regulatory Affairs Aurora Gas, LLC 1400 W. Benson Blvd., Suite 410 Anchorage, AK 99503 (907) 277 -1003 office (907) 229 -8398 cell (970) 277 -1006 fax 12/20/2007 Page 1 of 2 Davies, Stephen F (DOA) From: Bruce D Webb [bwebb @aurorapower.com] Sent: Tuesday, November 13, 2007 4:51 PM To: Davies, Stephen F (DOA) Subject: RE: spacing exception v. permit to drill Thanks again Steve, It looks like Escopeta has everything, except maybe the Bond. Danny Davis will be here tomorrow to meet with Dave Boelens and myself and I will ask him. Is there a database or individual at AOGCC I can check with as well, to verify (not that I wouldn't believe Danny Davis). I assume they need the bond in place — first — for the permit to drill, and cannot have the permit contingent on a bond prior to drilling activities, or could they? -Bruce Bruce D. Webb Manager, Land and Regulatory Affairs Aurora Gas, LLC 1400 W. Benson Blvd., Suite 410 Anchorage, AK 99503 (907) 277 -1003 office (907) 229 -8398 cell (970) 277 -1006 fax From: Davies, Stephen F (DOA) [mailto:steve.davies @alaska.gov] Sent: Tuesday, November 13, 2007 3:15 PM To: Bruce D Webb Subject: RE: spacing exception v. permit to drill Bruce, Yes, Escopeta can submit the application in advance of the permit to drill so long as Escopeta: 1. owns the lease upon which operations are proposed, 2. has submitted any required change of ownership and designation of operator forms for the affected lease(s), 3. has a bond in place with the Commission, and 4. Provides enough information for the Commission to publish a notice in the newspaper and online, such as: • surface and bottom hole locations, • which section(s) of 20 AAC 25.055 need exceptions, and • why the exceptions are needed (too close to lease line, too close to nearby well, second well in governmental section or quarter - section, etc.) Please let me know if you have additional questions. Steve Davies AOGCC 793 -1224 From: Bruce D Webb [mailto:bwebb @aurorapower.com] Sent: Tuesday, November 13, 2007 9:31 AM To: Davies, Stephen F (DOA) Subject: spacing exception v. permit to drill 12/20/2007 Page 2 of 2 Good morning Steve, • am helping Escopeta with their N. Alexander No. 1 well. They have decided to drill it only 625' from the section line. 1 According to the DNR Unit Plan of Exploration commitments require all permits to be in place by December 3 st know the Spacing Exceptions take about 45 days, and the Permit to Drill only a couple weeks. The engineer working up the drilling /casing /cementing /mud plan is traveling for about a week, and I need to get the ball rolling in the right direction. Is it possible to submit the Spacing Exception Application in advance of the Permit to Drill (by a couple weeks)? Thank you once again for your guidance. Bruce D. Webb Manager, Land and Regulatory Affairs Aurora Gas, LLC 1400 W. Benson Blvd., Suite 410 Anchorage, AK 99503 (907) 277 -1003 office (907) 229 -8398 cell (970) 277 -1006 fax 1 2/20/2007 41 • TRANSMITTAL LETTER CHECKLIST WELL NAME /V 4 - « e PTD#7 — / Development Service ' Exploratory Stratigraphic Test Non - Conventional Well Circle Appropriate Letter / Paragraphs to be Included in Transmittal Letter • CHECK ADD -ONS TEXT FOR APPROVAL LETTER WHAT (OPTIONS) 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(f), 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 compliance with 20 AAC EXCEPTION 25.055. Approval to perforate and produce / inject is contingent upon issuan ^� nnner!rvatinn nrriPr snows -� r) et a spacing VVV exception. ic, Eh a P� s , Lat esumes the liability of any protest to th�acing exception that may occur. DRY DITCH All dry ditch sample sets submitted to the Commission must be in 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. Please note the following special condition of this permit: Non - Conventional production or production testing of coal bed methane is not allowed Well 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. Rev: 7/132007 WELL PERMIT CHECKLIST Field & Pool Well Name: NORTH ALEXANDER 1 Program EXP Well bore seg ❑ PTD#: 2071690 Company E _OPETA Initial Class/Type EXP / PEND GeoArea 820 Unit On /Off Shore On Annular Disposal ❑ Administration '1 Permit fe,attached NA 2 Lease number appropriate Yes 3 Unique well name and number Yes 4 Well located in a defined pool No SPACING EXCEPTION under review by Legal. SFD 3/26/08. 5 Welllocated proper distance from drilling unit boundary No Violates 20 AAC25,055(2): will lie 625' from property line with Pacific Energy Alaska lease ADL 390585. 6 Well JOCated proper distance from other wells Yes 7 Sufficient acreage_available in drilling unit Yes Nearest well is located 3 miles distant. 8 if deviated, is wellbore platinciuded NA Vertical well 9 Operator only affected party N-o Pacific Energy Alaska lease lies about 625' from proposed locations. 10 Operator has_appropriate bond in force Yes BOND REQUIRED. Reminded again on 12/20/07 and 1/15/08. Pacific Energy (has bond) designated operator 2/2 11 Permit can be issued without conservation order No SPACING EXCEPTION under review by Legal. SFD 3/26/08. Appr Date 12 Permit can be issued without administrative approval Yes SFD 3/26/2008 13 Can permit be approved before 15-day wait NA • 14 Well located within area and strata authorized by Injection Order # (put 10# in_comment$)_(For NA_ 15 All welis_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 AS31.05.030(1.1-.A),(j_.2.A -D) NA Engineering 18 Conductor string provided Yes 19 Surface - casing protects all_known tJSDWs Yes 20 CMT vol_ adequate_to circulate_on conductor & surf csg Yes 21 CMT vol_ adequate_ to tie -in Jong string to surf csg Yes Cement calculations revised. 22 CMTwill coverall known- productive horizons Yes 23 Casing designs adequate for C, T, B & permafrost Yes 24 Adequate tankage -or reserve pit Yes Rig equipped with steel pits and while small, Aurora has successfully drilled grass roots wells using rig. 25 Its_ re- drill, has_ a_ 10-403 for abandonment been approved NA cuttings washed for beneficial reuse; liquid waste disposal tankagevolume notspecified 26 Adequate wellbore separation_proposed NA 27 If_diverter required, does it meet regulations Yes Inspection should be conducted prior to spud. Appr Date 28 Drilling fluid_ program schematic_& equip list adequate Yes Maximum anticipated formation pressure 9.4 EMW. Mud weightplanned up to 10.5 ppg. TEM 3/24/2008 29 BOPEs,_do they meet regulation Yes MASP calculated at 3315 psi. 5K rated , 3 ram w/ annular equipment required. Inspection required before spud_ - gIVI 3 • 0 BOPS_ press rating appropriate; test to (put psig in comments) 31 Ch Yes 5000 psi initial test, 3500 psi thereafter on 7 day schedule. P /API RP -53 Ma 84 Yes Inspection required before spud. ke le -o - - mani- fold com p lies w p q ( Y ) -j 6% 32 Work will occur without operation shutdown Yes 33 Is presence of H2S gas probable No H2S not reported in offsets. Rig should be equipped with standard H2S, CH4 detectors. 34 Mechanical condition of wells within AOR verified (For service well only) NA Geology 35 Permit can be issued w/o hydrogen_ sulfide measures Yes H2S was not observed on offset exploratory wells. 36 Data_presented on potential overpressurezones Yes Expected pressuregradient-is 0.49 psi/ft. Regs define "abnormally geo- pressured strata" as >0.50psi /fl. Appr Date 37 Seismic analysis of shallow gas zones Yes No evidence of shallow hazards seen at the proposed well location per Frank Banar, 12/26/07 letter. SFD SFD 12/27/2007 38 Seabed condition survey (if off - shore) NA 39 Contact name /phone for weekiy_progress reports [exploratory only] Yes Danny Davis, 713 - 623 -2219 Geologic Date: Engineering Date Public Date Pacific Energy designated as operator by Escopeta on 2/28/08. Pacific Energy established a $200,000 blanket bond (402 -67) Commissioner: Commissioner: Commissioner with AOGCC effective 01/15/2008. d > - 3-28 -9 8
