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Home My WebLink AboutO 080 • • Image Project Order File Cover Page XHVZE This page identifies those items that were not scanned during the initial production scanning phase. They are available in the original file, may be scanned during a special rescan activity or are viewable by direct inspection of the file. 0 0 c 6 0 Order File Identifier Organizing (done) /o -sided III II'IIIII III IIIII ❑ Rescan Needed 1 [1111 11 1111 RES AN DIGITAL DATA OVERSIZED (Scannable) Co r Items: ❑Diskettes, No. ❑Maps: reyscale Items: ❑Other, No/Type: ❑ Other Items Scannable by a Large Scanner ❑ Poor Quality Originals: OVERSIZED (Non - Scannable) ❑ Other: ❑ Logs of various kinds: NOTES: El Other:: 'TIP BY: Date: 3 /i /s/ Project Proofing II 11111111 11111 BY: C Maria Date: 7/ 3 J/ 3 isi m Scanning Preparation x 30 = + = TOTAL PAGES 1 07'7 p (Count does not include cover sheet) BY: Date: �3 � /s/ Production Scanning I 1111 Stage 1 Page Count from Scanned File: 1 30 (Count does include cover sheet) Pa.e Count Matches Number in Scanning Preparation: YES NO BY: . . Date: 7/c3 isi vvl p Stage 1 If NO in stage 1, page(s) discrepancies were found: YES NO BY: Maria Date: /s/ Scanning is complete at this point unless rescanning is required. I ReScanned 1 BY: Maria Date: /s/ Comments about this file: Quality Checked III 111111 III IIII III 1/17/2012 Orders File Cover Page.doc INDEX OTHER NO. 80 3oldotna Creek Unit 44-33 Failure to Notify of Changes to an Approved Permit Failure to Test Blowout Prevention Equipment 1. October 23, 2012 2. November 1-2, 2012 3. November 7, 2012 4. (October 10, 2012) - November 7, 2012 5. November 7, 2012 6. April 25, 2013 7. April 30 and May 3, 2013 8. October 30, 2013 Letter from AOGCC to Mazzolini (Hilcorp) re: Notice of Proposed Enforcement Action (SCU 44-33) Email from Mazzolini to Regg (AOGCC) re: Request for Informal Review to discuss the Notice of Proposed Enforcement Action (SCU 44-33 Hilcorp's Agenda for Informal Hearing with AOGCC Hilcorp's Daily Drilling Reports re: SCU 44-33 SCU 44-33 Informal Review Letter from Mazzolini (Hilcorp) to AOGCC re: Corrective Actions Copy of Penalty Check and Corrective Actions by Hilcorp Letter from AOGCC to Hilcorp regarding Hilcorp's acceptable response regarding payment of civil penalty INDEX OTHER NO. 80 • STATE OF ALASKA ALASKA OIL AND GAS CONSERVATION COMMISSION 333 West Seventh Avenue, Suite 100 Anchorage Alaska 99501 -3539 Re: Failure to Notify of Changes to an ) Approved Permit; and Failure to Test ) Other Order No. 80 Blowout Prevention Equipment ) April 10, 2013 Soldotna Creek Unit 44 -33 ) Hilcorp Alaska LLC. ) DECISION AND ORDER On October 23, 2012, the Alaska Oil and Gas Conservation Commission (AOGCC) issued a Notice of Proposed Enforcement Action (Notice) stating that Hilcorp Alaska, LLC (Hilcorp) failed to notify AOGCC of changes to an approved permit to drill (PTD) and failed to test blowout prevention equipment (BOPE) in its operation of Soldotna Creek Unit 44 -33 (SCU 44 -33). The Notice proposed specific corrective actions and a $115,500 civil penalty under AS 31.05.150(a). On November 2, 2012, Hilcorp requested informal review with the AOGCC to discuss the proposed enforcement. Summary of Proposed Enforcement Action Hilcorp was granted approval to drill well SCU 44 -33 in PTD 2121430 dated October 3, 2012 Drilling commenced October 11, 2012 using Doyon Rig 1 (also known as the Doyon Arctic Fox). The Notice identified violations of the provisions of 20 AAC 25.015 ( "Changes to a program in a permit to drill ") and 20 AAC 25.035 ( "Secondary well control for primary drilling and completion "). The violations occurred when (1) Hilcorp commenced sidetrack drilling of SCU 44 -33 at a depth shallower than approved; (2) drilling encountered an over - pressured zone that caused the well to flow which required closure of BOPE; and (3) Hilcorp tripped its drilling assembly to surface to change out equipment and returned to continued drilling operations without testing the BOPE used for well control. The Notice proposed the following corrective actions by Hilcorp: (1) Within 2 weeks following the date of receipt of AOGCC's final decision, Hilcorp shall provide a detailed description of its regulatory compliance program and a copy of its written management -of -change procedures; (2) Within 2 weeks following the date of receipt of AOGCC' s final decision, Hilcorp shall complete and provide AOGCC with the results of a root cause analysis addressing the violations. (3) Within 4 weeks following the date of receipt of AOGCC final decision, Hilcorp shall provide evidence that personnel responsible for drilling and workover rig management, and staff involved with permitting well operations (drilling and workovers) have been 1 SCU 44 -33 is an approved sidetrack from suspended well SCU 24 -33. The Application for Sundry Approvals, Form 10 -403, was approved by AOGCC allowing the well to be configured for sidetrack drilling of SCU 44 -33. • • Other Order No. 80 April 10, 2013 Page 2 of 5 trained in AOGCC drilling and workover regulatory requirements, including the process for making changes to approved activities, testing, and reporting requirements; (4) Beginning immediately upon receipt of AOGCC's final decision, BOPE testing on all drilling and workover operations must be performed when installed, repaired, or changed and at intervals not to exceed seven (7) days between tests unless otherwise approved by AOGCC. When used for well control or other equivalent purposes, or routine use may have compromised equipment effectiveness, BOPE used must be tested before the next wellbore entry. The Notice also proposed a civil penalty under AS 31.05.150(a) in the amount of $115,500 as follows: - $75,000 for the initial violation — failure to maintain the wellbore in an overbalanced condition by increasing the drilling fluid weight prior to milling the casing window as required in the PTD; - $7,500 for failure to notify AOGCC of change in well plans; specifically, using a lighter weight drilling fluid for milling and initial drilling operations than approved in the PTD; - $3,000 for failure to notify AOGCC of a change in well plans; specifically, milling the casing window at a shallower depth than approved in the PTD; - $7,500 for each day October 14 through October 17, 2012 for failure to test BOPE used in well control operations. Requirement to Notify of Changes; Requirement to Test BOPE after Use Regulation 20 AAC 25.015(b) establishes requirements to change an approved PTD and states in relevant part: "To change a program approved in a Permit to Drill or to change information under 20 AAC 25.005(c) after drilling operations start, the operator shall... (2) submit and obtain the commission's approval of an Application for Sundry Approvals (Form 10- 403)...; must set out the approved program, the current conditions of the well, and the proposed changes." (emphasis added) Regulation 20 AAC 25.035(e)(10)(C) establishes requirements when BOPE use is required for well control or other equivalent purposes and states in relevant part: "if any BOP equipment components have been used for well control... the components used must be function pressure- tested before the next wellbore entry, to the required working pressure specified in the approve Permit to Drill..." (emphasis added) Violations Hilcorp provided a Notice of BOPE Use to AOGCC on October 12, 2012 after closing the upper pipe rams to control the flow of formation fluids. Receipt of Hilcorp's notice initiated a review of the approved drilling permit and a request for additional information, including daily drilling reports. In response, Hilcorp revealed that the SCU 44 -33 sidetrack was started at a depth approximately 500 feet shallower than approved and the drilling mud weight was not increased • Other Order No. 80 April 10, 2013 Page 3 of 5 prior to commencing sidetrack drilling operations as required. Hilcorp drilling reports also indicate that the drilling assembly was tripped to surface on October 13, 2012 after BOPE was used to control SCU 44 -33 and re -run in the well on October 14, 2012 without testing the used BOPE components. Hilcorp's failure to comply was the result of either a lack of attention paid to the regulations or a lack of understanding regarding AOGCC expectations; in this particular case regulations with clearly worded expectations. The evidence shows that Hilcorp violated AOGCC regulations governing changes to an approved PTD and required BOPE testing. Mitigating Circumstances Mitigating factors considered by the AOGCC included (1) Hilcorp did not act in a willful or knowing manner; (2) the lack of injury to the public; (3) the absence of tangible benefits derived from the violations; and (4) Hilcorp's stated commitment to correct regulatory deficiencies. During the informal review, Hilcorp's explanation for why no notice was given regarding the changes to the approved permit was that the changes were not deemed by Hilcorp to be significant enough to warrant notification to AOGCC. No explanation was offered for failure to test BOPE as required. Hilcorp accepted responsibility for the violations and has initiated corrective actions, including - updating its management of change procedures (Facility Change Request) to incorporate AOGCC regulatory requirements; - developing and implementing a regulatory compliance tracking spreadsheet; - training and orientation; - improving communications from Hilcorp including more detailed permit applications, timely notification of changes to approved permits by phone with proper written follow -up, and inquiries regarding regulatory requirements. Findings and Conclusions The aggressiveness with which Hilcorp is moving forward with operations appears to be contributing to regulatory compliance issues. Since Hilcorp commenced rig work in Alaska in April 2012, AOGCC Inspectors have observed rig crews unable to perform required BOPE component tests, rig crews not trained in use of well control equipment, and rigs with missing required equipment. Hilcorp's compliance history from April through December 2012 — including this enforcement action — shows 13 separate enforcement actions of varying severity since April 2012. Many of these actions were due to a failure to understand regulatory requirements. Strong evidence indicates that Hilcorp has not adequately prepared its personnel for operations in compliance with AOGCC regulatory requirements. Left unaddressed and uncorrected these and similar violations will be repeated. For the reasons stated above, the AOGCC finds that Hilcorp violated regulations governing changes to an approved PTD and required BOPE testing. The seriousness of these violations, the number of prior violations, the need to deter similar behavior, and the need to trigger a • • Other Order No. 80 April 10, 2013 Page 4 of 5 substantial change in Hilcorp's approach toward regulatory compliance warrant proceeding with these enforcement actions as proposed. However, BOPE installed on rigs engaged in development drilling will be allowed to continue testing at intervals not to exceed 14 days as currently authorized in 20 AAC 25.035 and 25.036 unless otherwise required by AOGCC in a PTD or based on BOPE performance. Since AOGCC issued the Notice, Hilcorp has provided the proper notification for required bi- weekly BOPE tests on rigs involved in development drilling, performed those tests in an acceptable manner, and provided test results to AOGCC as required. Imposing a more frequent BOPE test interval is unnecessary. NOW THEREFORE IT IS ORDERED THAT: Hilcorp shall comply with the following corrective actions: 1) Within 2 weeks following the date of receipt of this final decision, Hilcorp shall provide a detailed written description of its regulatory compliance program and a copy of its written management -of- change procedures, including but not limited to examples of regulatory compliance tracking sheets and similar evidence that supports Hilcorp's compliance efforts specific to AOGCC regulations; 2) Within 2 weeks following the date of receipt of AOGCC's final decision, Hilcorp shall provide AOGCC with its complete root cause analysis and results addressing the violations outlined in this order. 3) By May 3, 2013, Hilcorp shall provide evidence that personnel responsible for drilling and workover rig management, and staff involved with permitting well operations (drilling, workovers, and well operational oversight) have been trained in AOGCC regulatory requirements, including the process for making changes to approved activities, notification procedures, testing, reporting, and record - keeping requirements. Records shall be maintained to substantiate completed training for Hilcorp and Hilcorp- contracted personnel. In addition, Hilcorp shall pay a civil penalty under AS 31.05.150(a) in the amount of $115,500 as follows: - $75,000 for the initial violation — failure to increase the drilling fluid weight prior to milling the casing window as required in the PTD; - $7,500 for failing to notify AOGCC of change in well plans; specifically, using a lighter weight drilling fluid for milling and initial drilling operations than approved in the PTD; - $3,000 for failing to notify AOGCC of a change in well plans; specifically, milling the casing window at a shallower depth than approved in the PTD; - $7,500 for each day October 14 through October 17, 2012 for failing to test BOPE used in well control operations. Done at Anchorage, Alaska and dated April 10, 2013. d ie ' Jo ? # OI �� _ Cathy Foerster Daniel T. eamount, Jr. '�''; K. Norman Chair, Commissioner Commissioner ', issioner .ir' i o`fir"!ILA at ,,?1 ''l1'k mj c.O't Other Order No. 80 April 10, 2013 Page 5 of 5 RECONSIDERATION AND APPEAL NOTICE As provided in AS 31.05.080(a), within 20 days after written notice of the entry of this order or decision, or such further time as the AOGCC grants for good cause shown, a person affected by it may file with the AOGCC an application for reconsideration of the matter determined by it If the notice was mailed, then the period of time shall be 23 days. An application for reconsideration must set out the respect in which the order or decision is believed to be erroneous The AOGCC shall grant or refuse the application for reconsideration in whole or in part within 10 days after it is filed. Failure to act on it within 10 -days is a denial of reconsideration. If the AOGCC denies reconsideration, upon denial, this order or decision and the denial of reconsideration are FINAL and may be appealed to superior court The appeal MUST be filed within 33 days after the date on which the AOGCC mails, OR 30 days if the AOGCC otherwise distributes, the order or decision denying reconsideration, UNLESS the denial is by inaction, in which case the appeal MUST be filed within 40 days after the date on which the application for reconsideration was filed. If the AOGCC grants an application for reconsideration, this order or decision does not become final. Rather, the order or decision on reconsideration will be the FINAL order or decision of the AOGCC, and it may be appealed to superior court. That appeal MUST be filed within 33 days after the date on which the AOGCC mails, OR 30 days if the AOGCC otherwise distributes, the order or decision on reconsideration. As provided in AS 31.05.080(b), "[tike questions reviewed on appeal are limited to the questions presented to the AOGCC by the application for reconsideration." In computing a period of time above, the date of the event or default after which the designated period begins to run is not included in the period; the last day of the period is included, unless it falls on a weekend or state holiday, in which event the period nns until 5:00 p.m. on the next day that does not fall on a weekend or state holiday. U.S. Postal Service, CERTIFIED MAILTM, RECEIPT .0 (Domestic Mail Only; No Insurance Coverage Provided) ff For delivery information visit our website at www.usps.com;, AN i o A L USE try i+r ' 0 1 m Postage $ $0.66 1 ��ti j, r., J,i'E' eflitaabove wag ofessfalkswIng at their Certified Fee $3.1.0 t S ` . `t at heiS d i- 1 4 . PosTmett` cr , O Retum Receipt Fee � CI (Endorsement Required) $2.55 Hocap ri Restricted Delivery Fee s 0 Cy Y� g O (Endorsement Required) $0.00 7 a ?Ctit U AAl2 0 l cU Ti 0 rt.l Total Pos tage $6.3 04/10 + . nu Sent To 0" Mr. Paul Mazzolini 0 Street, Apt. No.; or PO Box No. Drilling Manager N o Hilcorp Alaska LLC Post Office Box 244027 Anchors a AK 99524 -4027 SENDER: COMPLETE THIS SECTION COMPLETE THIS SECTION ON DELIVERY . • • Complete items 1, 2, and 3. Also complete A item 4 if Restricted Delivery is desired. x 0 Agent 111 Print your name and address on the reverse ❑ Addressee so that we can return the card to you. g Rec ivrd b ( Name) C Date of Delivery • Attach this card to the back of the mailpiece, l� ,; �+ — t C. U or on the front if space permits. ' V ' it D. Is delivery address different from item 1? 0 Yes 1. Article Addressed to: if YES, enter delivery address below: 0 No Mr. Paul Mazzolini 3. Type Drilling Manager II �d77 C�fied Mail ❑ Express Mail Hilcorp Alaska LLC 0 Registered 0 Retum Receipt for Merchandise Post Office Box 244027 0 Insured Mail 0 C.O.D. Anchorage, AK 99524-4027 4. Restricted Delivery? (Extra Fee) 0 Yes 2. Article Number .7.0 0.9 ,22.50 0 0 0 4 3911 3378 f r r a PS Form 3811, February 2004 Domestic Return Receipt 102595 - - 1540 #s THE STATE OJ 1 S -K-A- GOVERNOR SEAN PARNELL October 30, 2013 CERTIFIED MAIL — RETURN RECEIPT REQUESTED 7012 3050 0001 4812 5610 Mr. Paul Mazzolini Drilling Manager Hilcorp Alaska LLC P.O. Box 244027 Anchorage, AK 99524-4027 RE: Soldotna Creek Unit 44-33 Enforcement Corrective Actions Dear Mr. Mazzolini: Alaska Oil and Gas 333 West Seventh Avenue Anchorage, Alaska 99501-3572 Main: 907.279.1433 Fax: 907.276.7542 The Alaska Oil and Gas Conservation Commission (AOGCC) issued a final Decision and Order regarding the Soldotna Creek Unit 44-33 enforcement action on April 10, 20131. As part of the decision, Hilcorp Alaska LLC (Hilcorp) was ordered to pay a civil penalty in the amount of $115,500 and implement several corrective actions. Letters dated April 25 and May 5, 2013 responded to the requirements of the enforcement. Hilcorp has satisfied the financial obligations as directed by the AOGCC's Decision and Order. Based on implied implementation of corrective actions identified in the root cause analysis — namely the regulatory compliance program, management of change processes, and personnel training — AOGCC finds Hilcorp's response acceptable. With this letter we are officially closing the Soldotna Creek Unit 44-33 enforcement action. Sincerely, Cathy P. oerster Chair, Commissioner ' Other Order 80 • rat Only, :. .D t+1 For delivery Information visit our website at e fU 4, i •- s ca Postage $ Certified Fee Return Receipt Fee Postmark Here Q (Endorsement Required) Restricted Delivery Fee 1-_3 (Endorsement Required) U-1 C3 Total Postage m r1.l Sent To r9 _________________ Mr. Paul Mazzolini p Street, Apt. No.; or PO Box No. Drilling Manager C!ty State, ZIP+ Hilcorp Alaska, LLC Post Office Box 244027 ;,, Anchors a AK 99524-4027 ■ Complete items 1, 2, and 3. Also complete A. Signatur item 4 if Restricted Delivery is desired.� Agent ■ Print your name and address on the reverse X ❑ Addressee so that we can return the card to you. B. Received by ( Printed Name) C. Date of Delivery ■ Attach this card to the back of the mailpiece, or on the front if space permits. A D. Is delivery addres ifferent from item 1? ❑ Yes 1. Article Addressed to: If YES, enter delivery address below: ❑ No Mr. Paul Mazzolini 3. S ice Type Drilling Manager 0 Certified Mail ❑ Express Mail Hilcorp Alaska, LLC ❑ Registered ❑ Return Receipt for Merchandise Post Office Box 244027 ❑ Insured Mail ❑ C.O.D. Anchorage, AK 99524-4027 4. Restricted Delivery? (Extra Fee) ❑ Yes 2. Article Number (Transfer from service label) 7 012 3050 0001 4 812 5 610 PS Form 3811, February 2004 Domestic Return Receipt 102595-02-M-1540 #7 • • Copy of Penalty Check and Corrective Actions by Hilcorp Alaska, LLC • Hilcorp Alaska LLC AMEGY BANK 1 1131 1201 LOUISIANA, SUITE 1400 HOUSTON TX 77002 Void After 90 Days 713 - 209 -2400 Check No Check Date Check Amount 0082009002 04/30/2013 '*"*** PAY One Hundred Fifteen Thousand Five Hundred Dollars and Zero Cents TO STATE OF ALASKA THE AOGCC ORDER 333 WEST 7TH AVE -SUITE #100 ANCHORAGE AK 99501 -3539 OF Authorized Signature 0008 200900 20 ': L L 3 L LO 5861: 044440 7 7480 "PLEASE DETACH AT PERFORATION ABOVE" "PLEASE DETACH AT PERFORATION ABOVE Hilcorp Alaska LLC 1201 SUITE 1400 HOUSTON TX 77002 713- 209 -2400 Check Number 0082009002 Invoice # Inv. Date Description Amount Discount Net Amount 042913 04/29/2013 CIVIL PENALTY PAYMENT 115,500.00 0.00 115,500.00 1083380 1 Owner Check Date: 04/30/2013 Check Amount 4 115,500.00 • • • Hilcorp Paul Mazzolini Hilcorp Alaska, LLC C Drilling Manager P.O. Box 244027 Anchorage, AK 99524 -4027 Tel 907 777 8369 Email pmazzolini @hilcorp.com 05/03/2013 RECEIVED Alaska Oil & Gas Conservation Commission VI Ay 0 3 2013 Cathy Foerster, Commissioner 333 W. 7 Avenue, Suite 100 AOGCC Anchorage, Alaska 99501 Re: Enforcement Action SCU 44 -33 — Corrective Actions SCU 44 -33 (PTD 212143) Dear Commissioner Foerster, This submittal is to provide the AOGCC with the last of the requested corrective actions to be delivered by May 3, 2013 as mandated by the Order dated April 10, 2013 and received by Hilcorp Alaska, LLC on April 15, 2013. The corrective action response that is included for May 3, 2013 delivery to the AOGCC is as follows: 1. Hilcorp shall provide evidence of training of personnel responsible for the many different areas of compliance to AOGCC regulations including permitting, well site supervision, follow up reporting and documentation to be delivered on May 3, 2013 as requested. The civil penalty payment from Hilcorp Alaska, LLC is included with this final submittal of information to the AOGCC. If you have any questions, please contact me at 777 -8369. Sincerely, 7 4 ta Paul Mazzolini Drilling Manager Hilcorp Alaska, LLC Page 1 of 1 � Hilcorp Alaska, LLC AOGCC • 0011° Regulatory Compliance Training • A Company Built on Fnergy Integrity * Urgency * Ownership * Alignment * Innovation AOGCC Regulations Compliance: Drillin g Completion / Overview • Drilling (20 AAC 25.005 — 20 AAC 25.080) — Permit to Drill (20 AAC 25.005) — Changes to a program in a PTD (25.015) • — Bonding (25.025) — Casing & cementing (25.030) — Primary well control; drilling fluids (25.033) — Secondary well control; BOPE testing and notifications (25.035) — Directional Surveys (25.050) — Gas detection (25.066) • Abandonment and Plugging (20 AAC 25.105 — 20 AAC 25.172) • • Reporting and Recordkeeping (20 AAC 25.70, 25.280) • Industry Guidance Bulletins H Permit to Drill (20 AAC 25.005) Submit AOGCC Form 10 -401. This form must include: — Plat identifying property and property owners, showing coordinates at SHL, TPH, and BHL. Must be referenced to governmental section lines and NAD • 27 — Diagram and description of BOPE and diverter — Information on drilling hazards (MASP — must show calculations), data on potential gas zones, etc. — FIT procedure — Complete proposed casing and cementing procedure — Drilling fluid program • — Sea bed survey if appropriate — Waste disposal description — Directional survey procedure — Drilling Procedure — Well bore diagram 1 II Changes to a program in a PTD (25.015) • Changes to an approved PTD require prior approval from • AOGCC. • This approval can be a simple email acknowledgement of the planned change to the approved program. • The AOGCC inspector will determine if a formal sundry (10- 403) is required to document the change. • • The important step is to provide and document the notification ahead of time. Examples of Changes that Require AOGCC Approval: • Change in mud density • • Change in operational sequence • BOP test interval • Change to directional plan • Proposed surface location is changed • • Proposed bottom hole location or objective formation is changed by more than 500' laterally or vertically. Secondary Well Control; BOPE Testing and Notifications (25.035) BOP Test on a development or service well is required when: • Installed, repaired or changed AND • • At intervals not to exceed 14 days OR • Weekly if required by AOGCC (PTD or Sundry will specify test frequency) BOP Test on an exploratory or stratigraphic test well is required when: • Installed, repaired or changed AND • At intervals not to exceed 7 days. • If any BOPE components have been used for well control or other equivalent purpose, or if its effectiveness has been compromised, the BOPE must be tested prior to the next wellbore entry. Secondary Well Control; BOPE Testing and Notifications (25.035) A minimum of 24 hours notice must be given to AOGCC prior to • testing the BOPE so that a representative may witness the test. BOP Test results must be recorded and provided to AOGCC within five days after completing the test. Report any instance of BOPE use to prevent the flow of fluids • from a well to AOGCC within 24 hours. � Recordkeeping and Reporting Weekly Operations Updates : Courtesy or regulatory requirement? Approved PTD must be posted in driller's shack and Co Man / TP • offices. Completion Report — 10 -407 to be submitted within 30 days of well completion. BOPE Test Schedule — Courtesy or regulatory requirement? Retain record of drilling operations and have available for inspection by AOGCC: • ➢ At the well, and ➢ In the state for five years after the date of well abandonment AOGCC Regulatory Compliance: FE MOC Overview • Facility Engineering Management of Change (MOC) process in place to — Ensure hazards associated with "change" are properly evaluated and addressed from planning through execution — Ensure appropriate personnel are involved in decisions — Ensure regulations and permit stipulations are followed • MOC Screening Form helps personnel determine if the MOC process is required. See handout for form. • New Sharepoint Tool rolled out for MOC process. Kimberly Jones and Bo York main points of contact for questions. AOGCC R egu l a t ory C li p FEMOC O verv i ew HAK Management of Change Process Flow Chart MOC Initiator completes "Request MOC Form ", attaches All reviewers approve and Yes Operations Manager, Yes Screening Form, Redlines. sign Section 5? AT Lead, or FE — Manager Approves? No No 4110 V Production Foreman V Denied performs initial Reviewers perform parallel approval MOC Team Lead V approval and assigns and verify required documentation in < provides additional < Perform work MOC team lead. Section 4 information A Approved No Drawing updates Approved V required? Denied Operations Manager Yes performs initial approval V MOC Team Lead completes Section V V 4 and completes and attaches MOC Team Lead completes HAZAN and Regulatory Screening and submits all MOC Team Lead initiates Forms. MOC Team Lead selects documentation required in { drawing as built updates (if reviewers in Section 5. Section 5 applicable) by attaching • updated drawing to MOC and V n communicating to Drafting Tech (Steve Carson) MOC Team Lead verifies completion and attaches all required No documentation to MOC. U Is all documentation Send notification of action < complete? Drafting tech updates drawings and notifies Yes appropriate personnel V U MOC Team Lead Yes Inspections reviews No I END. MOC Closed closes MOC and < documentation and gives signs Section 6 final approval? AOGCC Regulatory Compliance Training - Operations Overview • Sundry Operations (20 AAC 25.280) • • Online Inspection Notification Procedure • Underground Injection Control (UIC) Operations (20 AAC 25.252 Disposal /Storage & 25.402 Waterflood) • Well Safety Valve System (SVS) (20 AAC 25.265) • Reporting and Recordkeeping (20 AAC 25.320 Forms) II AOGCC R egu l a t or y C li ance p Training - Opera Overv ew Well Work Operations and Sundry Notice/ Reporting Requirements for Pools Subject to Sundry Waiver Rules (April 24' 2013) SERVICE (INJECTION) WELLS NO FORMS REQUIRED 1 FORM REQUIRED 2 FORMS REQUIRED 10-403 Not Required 10-403 Not Required 1 10-403 Required 10 -404 not Required I 10404 / 10 or other form Required 10 -404 / 10.407 or other form Required • Thru- Tubing Operations (5) Thru - (S) Thru - Tubing Operations (5) j • Fill tag e Perforate a new pool (1) • Set & pull retievable plug • Reperforate existing intervals • Change GLV's • Perforate new intervals within a pool (S) • Dummy & guage ring runs • Patches (5) • Pull & rerun SS5V's • Cutting off tailpipes (5) • Pressure surveys - unless required by some specific approval SPECIAL (5) • Temperature surveys- unless required by some specific approval On a case -by -case basis, a 10 -403 will be required fora particular well or • Caliper Surveys operation if the Commission requests It. • Bottom hole samples i If a well is operating under a sundry approval, a 1 -403 may be • Spinner Surveys required to perform work. The operator should consult with the • Logs - CNL, TOT, CO, CCL, CRL and other types - unless required by some i AOGCC to determine if a 10-40115 needed. specific approval If operations in this column are planned on a DISPOSAL well, the operator rr Please note that authorization from EPA Region 10 may be necessary to should contact the AOGCC to determine if a 10.404 is required perform any work on a Class I disposal well Pumping Operations, including using coil (S) < Pumping Operations, Including using coil (5) Pumping Operations, including using coil (5) • Tubing scale removal • Remedial cementing operations • Stimulations (frac or acid) (5) • Sludge removal c Conductor fill (S) • Remedial cementing operations (including but not limited to) O • Freeze protection • Squeezes /plugs to control fluid movement in zone (5) o Casing Shoes (outer annulus) (S) • Ice plug removal • Repair casing- Included but not limited to; • High pressure breakdown or inhibitor squeezes, excluding frac or acid jobs 0 Mechanical repairs (1) • Hot oil o "Pumping" repairs (cement or gel squeezes) (5) 1 • Tubing acid jobs • Fill Clean out . ._.._ _.___ _.. _. .... , 1 Other Operations (5) Other Operations (5) Other Operations (5) • Xmas tree & valve replacement • Injection well MIT (on MIT form) (5) • Major welding repairs on wellheads (5) • Diagnostic & pressure testing - unless required by some specific approval • Initial conversion from water injector to WAG injector (5) • Conductor "cutaways" and surface casing welding repairs (S) • Convert from injector to producer if for more than 30 days (5) • Annular disposal (Reported on form 10 -423) (5) • Seal welding on bradenheads (S) Rig/ Coil Operations • Alteration of mechanical completion (including but not limited to) o Pulling Tubing, milling packers (5) • Repair casing (including but not limited to) 0 Mechanical repairs (scab liners, tiebacks, etc)(5) Note: If you have any questions or require clarification contact your Regulatory Tech or Operations Engineer before beginning any work. AOGCC Regulatory Compliance Training - Operations Overview • Sundry Operations (20 AAC 25.280) • Online Inspection Notification Procedure • Underground Injection Control (UIC) Operations (20 AAC 25.252 Disposal /Storage & 25.402 Waterflood) • Well Safety Valve System (SVS) (20 AAC 25.265) • • Reporting and Recordkeeping (20 AAC 25.320 Forms) AOGCC Reg ula t ory Com li ance p Training - Operations Overview From: Regg, James B (DOA) <jim,regg alaska.gov- Sent: Mon 2/4/2013 5:46 PM To: Daniel, Ryan; billml bp.com; Redmond, Randy; 4 Larry Greenstein; Stan Golis; Chris Myers; Paul Mazzollni; NSK Fieldwide Operations Supt; Kanady, Randall 8; Mark C Wiggin; dmcmaster whpacific.com; Polkoski, David; Williams, Theresa; robert.tirpack(pxd.com; Harness, Evan; Erik Opstad; david.hall@cookinlet.net; Massey Steve; Flafziger Laura; George Pollock; Bill Penrose; Stephen F. Hennigan; James Inman; Chuck Johnson; Steve Ward; Matthew Federle; Richard Gentges; Phillips, Barney; Bridge, Alexander Cc: Schwartz, Guy L (DOA); DOA AOGCC Prudhoe Bay Subject: AOGCC Inspection Notification Procedures • Attachments: w Industry Guidance 10-01A.pdf (480 KB) i 1 _ 2 ••3 1 4 i ',,.5 -- 1 6 1 . . . 7 . . . i . . 8 ' . . . 9 •10 y ' AOGCC revised its test /inspection notification procedures on November 7, 2012. Industry Guidance Bulletin 10 -01A documents the revised notification procedures. Accompanying that, AOGCC added a test notification form on its 1.vebpage (http: /Jdoa.alaska.gov /ogc /farms /TestWitnessNotif.html). This change was in response to the elimination of AOGCC pager and transition to smart phones and an emphasis on email notification for inspections and test witness opportunities. AOGCC has recently enhanced this form to acknowledge receipt of the notice and include a copy of the notice for your records, and document procedures to follow if you do not hear back from an Inspector within 12 hours. It has come to my attention that some field personnel that are responsible for making notification to AOGCC about test witnessing have not been made aware of this change. Please forward the revised notification procedures to appropriate personnel. Another issue that we have identified is some are using the wrong email address to notify AOGCC Inspectors. Frequently there will be a response from an AOGCC Inspector generated on their smart phone while in the field confirming or waiving witness of a test. PLEASE DO NOT USE THE SMART PHONE EMAIL ADDRESS (beginning with "OGClnspector") as this may not reach the appropriate people. If an operator responds to this address it will only go to the smart phones, not the entire distribution list. Inspection - related email correspondence must be sent to AOGCC.Inspectors a alaska.gov (cc'd above) as referenced in the attached guidance bulletin; this email group address is distributed to all AOGCC Inspectors. I appreciate your assistance in making this a successful transition. Jim Regg Supervisor, Petroleum Inspections AOGCC 333 W. 7th Ave, Suite 100 Anchorage, AK 99501 907 - 7934236 '� AOGCC Regulatory Compliance Training - Operations Overview • Sundry Operations (20 AAC 25.280) • • Online Inspection Notification Procedure • Underground Injection Control (UIC) Operations (20 AAC 25.252 Disposal /Storage & 25.402 Waterflood) • Well Safety Valve System (SVS) (20 AAC 25.265) • • Reporting and Recordkeeping (20 AAC 25.320 Forms) R Com li ance AOGCC p Training - O erations O verview p STATE OF ALASKA ALASKA OIL AND GAS CONSERVATION COMMISSION Mechanical Integrity Test Submit to: jim.reggyalaska.govj AOGCC.InspectorsRalaska.gov, phoebe.brooksyalaska.gov chris.wallace/alaska.gov OPERATOR: Hilcorp Alaska, LLC • FIELD I UNIT I PAD: McArthur River /Trading Bay Unit/Dory Varden Platforn DATE: 04109113 OPERATOR REP: Austin Adler AOGCC REP: Lou Grimaldi Packer Depth Pretest Initial 15 Mn. 30 Mn. 45 Mn. 60 Mn. Well D -45 Type Inj. W TVD 8,933 Tubing 3400 3400 3400 3400 Interval O P.T.D. 1881400 Type test P Test psi 2233 Casing 155 2330 2285 2280 P/F P Notes: Post wireline work to repair tbg x csg comm. CA 105 118 121 122 Well Type Inj. TVD Tubing Interval P.T.D. Type test Test psi Casing P/F Notes: OA Well Type In]. TVD Tubing Interval P.T.D. Type test Test psi Casing P/F Notes: OA Well Type Inj. TVD Tubing Interval • P.T.D. Type test Test psi Casing P/F Notes: OA Well Type Inj. TVD Tubing Interval P.T.D. Type test Test psi Casing P/F Notes: OA TYPE INJ Codes TYPE TEST Codes INTERVAL Codes D= Drilling Waste M= Annulus Monitoring I= Initial Test G = Gas P = Standard Pressure Test 4= Four Year Cycle = Industrial Wastewater R Internal Radioactiae Tracer Suney V = Required by Variance N. Not Injecting A= Temperature Anomaly Survey 0= Other (describe in notes) W = Water D. Differential Temperature Test AOGCC Regulatory Compliance Training - Operations Overview • Sundry Operations (20 AAC 25280) • • Online Inspection Notification Procedure • Underground Injection Control (UIC) Operations (20 AAC 25.252 Disposal /Storage & 25.402 Waterflood) • Well Safety Valve System (SVS) (20 AAC 25.265) 4) • Reporting and Recordkeeping (20 AAC 25.320 Forms) AOGCC Regulatory Compliance Trainin g - Operations Overview Alaska Oil and Gas Conservation Commission Safety Valve System Test Report Operator Chevron Submitted By: Sandy McMillan Date: 4/5/2011 Operator Rep: Rick Musgrove Field/Unit/Pad Happy Valley A -Pad AOGCC Rep: Bob Noble Separator psi: LPS 254 HPS Well Data Pilots SSV SSSV Retest/SI Date Well Type Well Pressures Gas Lift Waiver Well Permit Separ Set L/P Test Test Test Date Passed Retest O, WAG, ®NJ, Inner Oder Tubing Yes/No Yes/No Nomber Nmuber PSI PSI Trip Code Code Code Or Date Simi In GAS, CYCLE, si PSI PSI PSI Al 2030720 254 200 202 P P 4/5/2011 GAS 260 No No A2 2031130 254 200 202 P P 4 /5/2011 GAS 265 No No A3 2032220 254 3/1/2004 SI No No 1 A4 2032230 254 3/1/2004 SI No No A6 2040440 254 6/1/2004 SI No No A7 2041060 254 8/1/2004 SI No No AS 2041140 254 200 200 P P 4/5/2011 GAS 262 No No A9 2041700 254 200 202 P P 4/5/2011 GAS 261 No No Al0 2041860 254 200 200 P P 4/5/2011 GAS 283 No No All 2042070 254 1/22/2010 SI No No • Wells: 5 Components: 10 Failure 0 Failure Rate: 000% ❑ Remarks: • • Date: 4/30/2013 IIilcorp Alaska, EEC Subject: AOGCC Regulatory Compliance Training N ab' title' --. /OY�'V l p c-c.� / / 5 ,t oke H(p l(er Dr; bi C.`n0 et . iC IAA va- d 10 CGS r ViaM c c f fe c u( ' IA_ /. 011.41-7.4- /-i ?`� 1 or 11h i r; I . /.1 nee; K • 4 it cam. 1 'ef a. i 7: IQ ifty A) I )4 01 \ ' Eil V ) roel fru-IVil (midi 6 Y'...) , , _ ��L ° r' r<< /,/ ��-c �; - s X5,7 Ci 7 .. / 4,-C i S/4-e-- Tit i '° M, " F 4,I trry t f r St r M t„,16„..ba Rte seN NA f• Eh %Hier i/ � N �� ;�,t*,i-E Y 61G V1 €'r - .CA 1 I - o'" 1 AOGCC / BLM Regulatory Compliance Training Drilling Team HAK Safety HAK Environmental Drilling Field Personnel Review Regulations Notifications 10 -01A Surf Cmte 13 -001 Requirements Compliance Shane Hauck Y Y Y Y Y Marvin Rogers Y Y Y Y Y Rick Brumley Y Y Y Y Y Joe Mc Ginnis Y Y Y Y Y Mike Leslie Y Y Y Y Y • Rance Pederson Y Y Y Y Y Jimmy Greco Y Y Y Y Y Joe Grubb Y Y Y Y Y Clint Chantey Y Y Y Y Y • 1 AOGCC / BLM Regulatory Compliance Training Cook Inlet Offshore Asset Team HAK Safety HAK Environmental Consultant Field Personnel Review Rees Notifications 10 -01A NOV Review Requirements Compliance Jack Anderson Y Y Y Y Y Charlie Cameron Y Y Y Y Y Ed Hooter Y Y Y Y Y Harold Soule Y Y Y Y Y • Billy Applewhite Y Y Y Y Y Greg Evanson Y Y Y Y Y Bob Finch Y Y Y Y Y • 1 AOGCC / BLM Regulatory Compliance Training North Kenai Asset Team Consultant Field Personnel Review Rees Notifications 10 -01A NOV Review HAK Safety HAK Environmental Requirements Compliance Donnie Huffman Y Y Y Y Y Wade Hudgens Y Y Y Y Y Russell Godwin Y Y Y Martin Longoria Y Y Y Y Y • • AOGCC / BLM Regulatory Compliance Training South Kenai Asset Team Consultant Field Personnel Review Regs Notifications 10 -01A NOV Review HAK Safety HAK Environmental Requirements Compliance Bobby Adams Y Y Y Y James Ostroot Y Y Y Y Y Micheal Sulley Y • • � Hilcorp Alaska, LLC AOGCC • 0111111111111111111° Regulatory Compliance Training • A Company Built on Fnergy Integrity * Urgency * Ownership * Alignment * Innovation AOGCC Regulations Compliance: Drilling / Completion Overview • Drilling (20 AAC 25.005 — 20 AAC 25.080) — Permit to Drill (20 AAC 25.005) — Changes to a program in a PTD (25.015) • — Bonding (25.025) — Casing & cementing (25.030) — Primary well control; drilling fluids (25.033) — Secondary well control; BOPE testing and notifications (25.035) — Directional Surveys (25.050) — Gas detection (25.066) • Abandonment and Plugging (20 AAC 25.105 — 20 AAC 25.172) • • Reporting and Record keeping (20 AAC 25.70, 25.280) • Industry Guidance Bulletins Permit to Drill (20 AAC 25.005) Submit AOGCC Form 10 -401. This form must include: — Plat identifying property and property owners, showing coordinates at SHL, TPH, and BHL. Must be referenced to governmental section lines and NAD • 27 — Diagram and description of BOPE and diverter — Information on drilling hazards (MASP — must show calculations), data on potential gas zones, etc. — FIT procedure — Complete proposed casing and cementing procedure — Drilling fluid program — Sea bed survey if appropriate — Waste disposal description — Directional survey procedure — Drilling Procedure — Well bore diagram II Changes to a program in a PTD (25.015) • Changes to an approved PTD require prior approval from • AOGCC. • This approval can be a simple email acknowledgement of the planned change to the approved program. • The AOGCC inspector will determine if a formal sundry (10- 403) is required to document the change. • The important step is to provide and document the notification ahead of time. H Examples of Changes that Require AOGCC Approval: • Change in mud density • • Change in operational sequence • BOP test interval • Change to directional plan • Proposed surface location is changed • • Proposed bottom hole location or objective formation is changed by more than 500' laterally or vertically. Secondary Well Control; BOPE Testing and Notifications (25.035) BOP Test on a development or service well is required when: • Installed, repaired or changed AND • • At intervals not to exceed 14 days OR • Weekly if required by AOGCC (PTD or Sundry will specify test frequency) BOP Test on an exploratory or stratigraphic test well is required when: • Installed, repaired or changed AND • At intervals not to exceed 7 days. • If any BOPE components have been used for well control or other equivalent purpose, or if its effectiveness has been compromised, the BOPE must be tested prior to the next wellbore entry. Secondary Well Control; BOPE Testing and Notifications (25.035) A minimum of 24 hours notice must be given to AOGCC prior to • testing the BOPE so that a representative may witness the test. BOP Test results must be recorded and provided to AOGCC within five days after completing the test. Report any instance of BOPE use to prevent the flow of fluids • from a well to AOGCC within 24 hours. � Recordkeeping and Reporting Weekly Operations Updates : Courtesy or regulatory requirement? Approved PTD must be posted in driller's shack and Co Man / TP • offices. Completion Report — 10 -407 to be submitted within 30 days of well completion. BOPE Test Schedule — Courtesy or regulatory requirement? Retain record of drilling operations and have available for inspection by • AOGCC: ➢ At the well, and ➢ In the state for five years after the date of well abandonment AOGCC Regulatory Compliance: FE MOC Overview • Facility Engineering Management of Change (MOC) process in place to • — Ensure hazards associated with "change" are properly evaluated and addressed from planning through execution — Ensure appropriate personnel are involved in decisions — Ensure regulations and permit stipulations are followed • MOC Screening Form helps personnel determine if the MOC process is required. See handout for form. • • New Sharepoint Tool rolled out for MOC process. Kimberly Jones and Bo York main points of contact for questions. AOGCC Regulatory Compliance II FEMOCO HAK Management of Change Process Flow Chart MOC Initiator completes "Request MOC Form ", attaches MOC All reviewers approve and Yes Operations Manager, Yes — Screening Form, Redlines. > sign Section 5? AT Lead, or FE 9 Manager Approves? • No No ./ Production Foreman V De nied performs initial Reviewers perform parallel approval MOC Team Lead V approval and assigns and verify required documentation in < provides additional Perform work MOC team lead. Section 4 information A V Approved No Drawing updates Approved V required? Denied Operations Manager Yes performs initial approval V MOC Team Lead completes Section V / 4 and completes and attaches MOC Team Lead completes HAZAN and Regulatory Screening and submits all MOC Team Lead initiates Forms. MOC Team Lead selects documentation required in < drawing as built updates (if reviewers in Section 5. Section 5 applicable) by attaching • updated drawing to MOC and A V communicating to Drafting Tech (Steve Carson) MOC Team Lead verifies completion and attaches all required No documentation to MOC. V Is all documentation Send notification of action < complete? Drafting tech updates drawings and notifies Yes appropriate personnel V V MOC Team Lead Yes Inspections reviews No END. MOC Closed closes MOC and < documentation and gives signs Section 6 final approval? 11 AOGCC Regulatory Compliance Training - Operations Overview • Sundry Operations (20 AAC 25.280) • • Online Inspection Notification Procedure • Underground Injection Control (UIC) Operations (20 AAC 25.252 Disposal /Storage & 25.402 Waterflood) • Well Safety Valve System (SVS) (20 AAC 25.265) • • Reporting and Recordkeeping (20 AAC 25.320 Forms) 11 AOGCC R egu l a t ory C om pli ance Training - Operations Overvi ew n Well Work Operations and Sundry Notice/ Reporting Requirements for Pools Subject to Sundry Waiver Rules (April 24' 2013) Ildrnrp ANA , 1.1.0 SERVICE (INJECTION) WELLS NO FORMS REQUIRED _ _ _ 1 FORM REQUIRED 2 FORMS REQUIRED 10 -403 Not Required r 10 Not Required 10-403 Required 10-404 not Required 10 / 10 or other form Required 10-404 J 10-407 or other form Required Thru-Tubing Operations (S) Thru- Tubing Operations (S) 1 Thru- Tubing Operations (5) • Perforate a new pool 5 • Fill tag p (5) • Set & pull retievable plug • Re, perforate existing intervals • Change GLV's • Perforate new intervals within a pool (5) 5 • Dummy & gouge ring runs • Patches () • Pull & rerun SSSV's • Cutting off tailpipes (5) • Pressure surveys - unless required by some specific approval SPECIAL (S) • Temperature surveys- unless required by some specific approval On a case -by -case basis, a 10 -403 will be required for a particular well or • Caliper Surveys operation if the Commission requests it. • Bottom hole samples If a well is operating under a sundry approval, a 10 -403 may be • Spinner Surveys required to perform work. The operator should consult with the • Logs - CNL, TOT, CO, CCL, COL and other types - unless required by some i AOGCC to determine if a 10.403 is needed. specific approval If o •erations in this column are •fanned on a DISPOSAL well the • •erat. r Please note that authorization from EPA Region 10 may be necessary to should contact the AOGCC to determine if a 10404 js required perform any work on a Class I disposal well Pumping Operations, including using coil (5) Pumping Operations, Including using coil (S) PuLri�na O,perabons, including using coil (S) • Tubing srale removal • Remedial cementing operations • Stimulations (frac or acid) (5) • Sludge removal 0 Conductor fill (5) • Remedial cementing operations (including but not limited to) • Freeze protection • Squeezes /plugs to control fluid movement in zone (S) o Casing Shoes (outer annulus) (S) • Ice plug removal s Repair casing - Included but not limited to • High pressure breakdown or inhibitor squeezes, excluding frac or acid jobs o Mechanical repairs (5) • Hot oil 0 "Pumping" repairs (cement or gel squeezes) (5) • Tubing acid jobs • Fill Clean out Other Operations (5) Other Operations (5) ( Other Operation, S) • Xmas tree & valve replacement • Injection well MIT (on MIT form) (5) • Major welding repairs on wellheads (S) • Diagnostic & pressure testing - unless required by some specific approval • Initial conversion from water injector to WAG injector (5) • Conductor "cutaways" and surface casing welding repairs (S) • Convert from injector to producer 3 for more than 30 days (5) •Annular disposal (Reported on form 10 -42)) (S) • Seal weldingon bradenheads (S) j l Rig /Coil Operations • Alteration of mechanical completion (including but not limited to) o Pulling Tubing, milling packers (5) • Repair casing (including but not limited to) o Mechanical repairs (scab liners,tiebacks, etc Note: If you have any questions or require clarification contact your Regulatory Tech or Operations Engineer before beginning any work. AOGCC Regulatory Compliance Na- Training - Operations Overview • Sundry Operations (20 AAC 25.280) • • Online Inspection Notification Procedure • Underground Injection Control (UIC) Operations (20 AAC 25.252 Disposal /Storage & 25.402 Waterflood) • Well Safety Valve System (SVS) (20 AAC 25.265) ~ • Reporting and Recordkeeping (20 AAC 25.320 Forms) 11 AOGCC Regulatory Compuance Training -Operations Overview From: Regg, lames B (DOA) <jim.regg alaska.gov Sent: Mon 2/4/2013 5:46 PM To: Daniel, Ryan; billmI,e bp.com; Redmond, Randy; ^ Larry Greenstein; Stan Golis; Chris Myers; Paul Mazzolini; NSK Fieldwide Operations Supt; Kanady, Randall B; Mark C. Wiggin; dmcmaster @vdhpacific.com; Polkoski, David; Williams, Theresa; robert.tirpackcpxd.com; Harness, Evan; Erik Opstad; david.h& cookinlet.net; Massey Steve; NNofziger Laura; George Pollock; Bill Penrose; Stephen F. Hennigan; James Inman; Chuck Johnson; Steve Ward; Matthew Federle; Richard Gentges; Phillips, Barney; Bridge, Alexander Cc: Schwartz, Guy L (DOA); DOA AOGCC Prudhoe Bay • Subject: AOGCC Inspection Notification Procedures Attachments: Industry Guidance 10-01A.pdf (480 KB) ••• 1 ••• i. . . 2 . . . 1 . . . 3 ••• 4 . . . i 5 . i 6 ••• 1 •. . 7. . . . . .8 9 102 r l AOGCC revised its test /inspection notification procedures on November 7, 2012. Industry Guidance Bulletin 10 -01A documents the revised notification procedures. Accompanying that, AOGCC added a test notification form on its webpage (http: / /doa.aiaska.gov /ogc /forms /TestWitnessNotif.html). This change was in response to the elimination of AOGCC pager and transition to smart phones and an emphasis on email notification for inspections and test witness opportunities. AOGCC has recently enhanced this form to acknowledge receipt of the notice and include a copy of the notice for your records, and document procedures to follow if you do not hear back from an Inspector within 12 hours. It has come to my attention that some field personnel that are responsible for making notification to AOGCC about test witnessing have not been made aware of this change. Please forward the revised notification procedures to appropriate personnel. Another issue that we have identified is some are using the wrong email address to notify AOGCC Inspectors. Frequently there will be a response from an AOGCC Inspector generated on their smart phone while in the field confirming or waiving witness of a test. PLEASE DO NOT USE THE SMART PHONE EMAIL ADDRESS (beginning with "OGClnspector") as this may not reach the appropriate people. if an operator responds to this address it will only go to the smart phones, not the entire distribution list. Inspection - related email correspondence must be sent to AOGCC.lnspectors @alaska.gov (cc'd above) as referenced in the attached guidance bulletin; this email group address is distributed to all AOGCC Inspectors. I appreciate your assistance in making this a successful transition. Jim Regg Supervisor, Petroleum Inspections AOGCC 333 W. 7th Ave, Suite 100 Anchorage, AK 99501 907 -793 -1236 AOGCC Regulatory Compliance Training - Operations Overview • Sundry Operations (20 AAC 25.280) • • Online Inspection Notification Procedure • Underground Injection Control (UIC) Operations (20 AAC 25.252 Disposal /Storage & 25.402 Waterflood) Weil c-+_r_i. , Valve ,��,...,,,, (SVS) inn n n nc • VVeil Safely Valve �yslem (20 AAC 25.265) • Reporting and Recordkeeping (20 AAC 25.320 Forms) Regulatory Com fiance AOGCC p Training - O erations Overview p STATE OF ALASKA ALASKA OIL AND GAS CONSERVATION COMMISSION Mechanical Integrity Test Submit to: jim.regq(alaska.gov; AOGCC.InspectorsWalaska.gov, phoebe.brooksypalaska.coy chris.wallace8alaska.coy OPERATOR: Hilcorp Alaska, LLC • FIELD 1 UNIT I PAD: McArthur River /Trading Bay UnitlDoly Varden Platforn DATE: 04/09/13 OPERATOR REP: Austin Adler AOGCC REP: Lou Grimaldi Packer Depth Pretest Initial 15 Mn. 30 Mn. 45 Mn. 60 Mn. Well D-45 Type Inj. W TVD 8,933' Tubing 3400 3400 3400 3400 Interval 0 P.T.D. 1881400 Type test P _ Test psi 2233 Casing 155 2300 2285 2280 PIF P Notes: Post wireline work to repair tog ecsgcomm. OA 105 118 121 122 Well Type In). TVD Tubing Interval P.T.D. Type test Test psi Casing PIF Notes: OA Well Type In). TVD Tubing Interval P.T.D. Type test Test psi Casing PIF Notes: OA Well Type Inj. TVD Tubing Interval • P.T.D. Type test Test psi Casing PIF Notes: OA Well Type In). TVD Tubing Interval P.T.D. Type test Test psi Casing PIF Notes: OA TYPE INJ Codes TYPE TEST Codes INTERVAL Codes D= Drilling Waste M = Annulus Monitoring I. Initial Test G =Gas P= Standard Pressure Test 4= Four Year Cycle I = Industrial Wastewater R = Internal Radioactive Tracer Survey V = Required by Variance N. Not Injecting A Temperature Anomaly Survey 0= Other (describe in notes) W = Water 0 = Differential Temperature Test • AOGCC Regulatory Compliance Training - Operations Overview • Sundry Operations (20 AAC 25.280) • • Online Inspection Notification Procedure • Underground Injection Control (UIC) Operations (20 AAC 25.252 Disposal /Storage & 25.402 Waterflood) • Well Safety Valve System (SVS) (20 AAC 25.265) • Reporting and Recordkeeping (20 AAC 25.320 Forms) AOGCC Regulatory Compliance Training - Operations Overvi ew Alaska Oil and Gas Conservation Commission Safety Valve System Test Report Operator. Chevron Submitted By. Sandy McMillan Date: 4/5/2011 Operator Rep: Rick Musgrove Field/Unit/Pad Happy Valley A -Pad • AOGCC Rep: Bob Noble Separator psi: LPS 254 HPS Well Data Pilots SSV SSSV Retest/SI Date Well Tjpe Well Pressures Gas Lift FVaiver Well Perm* Separ Set L/P Test Test Test Date Passed Retest oa, WAG, OM, Inner Oder Tubing Yes/No Yes/No Number Number PSI PSI Trip Code Code Code Or Date Slid In GAS, CYO, SI PSI PSI PSI Al 2030720 254 200 202 P P 4/5/2011 GAS 260 No No A2 2031130 254 200 202 P P 4/5/2011 GAS 265 No No A3 2032220 254 3/1/2004 SI No No A4 2032230 254 3/1/2004 SI No No A6 2040440 254 6/1/2004 SI No No A7 2041060 254 8/1/2004 SI No No A8 2041140 254 200 200 P P 4/5/2011 GAS 262 No No A9 2041700 254 200 202 P P 4/5/2011 GAS 261 No No A10 2041860 254 200 200 P P 4/5/2011 GAS 283 No No All 2042070 254 1/22/2010 SI No No I Wells: 5 Components: 10 Failure 0 Failure Rate: 000%0 Remarks: _ . _.. 0 0 Date: 4/30/2013 Ililcarp Alaska, LLC Subject: AOGCC Regulatory Compliance Training /or-v F r---- c- - 5 c 4 4 C V a.v\ V1 � 'a� - c S'�e e . _ /? ,,!�j 1 ?i? 1/ hi a e/l�r/I.4d x i 1 : i-A /_ t 'I 7.7e(24-.. , , '1" / ai /1 c irw-N__Ci .., 6 .1 . 7-49 il 1 a/" l l l G ? i icy 1 A Me Y 46 Ag/C l t,/ v di t„, m t k cn EA V I r AY.4 ( CC .l rlGtaW '''')A,J1 Po L +' o '( 0 ' e C. +f L e c� � .. Tel. 1 how . ' 8 °'�`"T w 11EMEN MilliMillialr. 1 ■■• • . mow r ""? 0 i ( / ***41 Yet 4e i>2101-efivi--' Sk.e--- >tt.r ISetct� A4a(t lyl+'►�V\ Rest Nov' Cti i e, N e 4 �� ;\i t(,�J j _ (`1Gkir t v v'1' -�-1.CA 11 il F ∎-- e-e. - ' i I 1 AOGCC / BLM Regulatory Compliance Training Drilling Team HAK Safety HAK Environmental Drilling Field Personnel Review Regulations Notifications 10 -01A Surf Cmtg 13 -001 Requirements Compliance Shane Hauck Y Y Y Y Y Marvin Rogers Y Y Y Y Y Rick Brumley y Y Y Y Y Joe McGinnis Y Y Y Y Y S Mike Leslie Y Y Y Y Y Rance Pederson Y Y Y Y Y Jimmy Greco Y Y Y Y Y Joe Grubb Y Y Y Y Y Clint Chanley Y Y Y Y Y • AOGCC / BLM Regulatory Compliance Training Cook Inlet Offshore Asset Team HAK Safety HAK Environmental Consultant Field Personnel Review Rees Notifications 10 -01A NOV Review Requirements Compliance Jack Anderson Y Y Y Y Y Charlie Cameron Y Y Y Y Y Ed Hooter Y Y Y Y Y Harold Soule Y Y Y Y Y • Billy Applewhite Y Y Y Y Y Greg Evanson Y Y Y Y Y Bob Finch Y Y Y Y Y • 1 AOGCC / BLM Regulatory Compliance Training North Kenai Asset Team Consultant Field Personnel Review Rees Notifications 10 -01A NOV Review HAK Safety HAK Environmental Requirements Compliance Donnie Huffman Y Y Y Y Y Wade Hudgens Y Y Y Y Y Russell Godwin Y Y Y 0 Martin Longoria Y Y Y Y Y • AOGCC / BLM Regulatory Compliance Training South Kenai Asset Team HAK Safety HAK Environmental Consultant Field Personnel Review Rees Notifications 10 -01A NOV Review Requirements Compliance Bobby Adams Y Y Y Y James Ostroot Y Y Y Y Y Micheal Sulley Y S • #6 • RECEIVED APR 2 6 2013 Hilcorp Paul MazzoNnl Hllcorp Alaska, LLC AOGCC Emmy Drilling Manager P.O. Box 244027 Anchorage, AK 99524 -4027 Tel 907 777 8369 Email pmazzoNrN @hfcorp.com 04/25/2013 Alaska Oil & Gas Conservation Commission Cathy Foerster, Commissioner 333 W. 7 Avenue, Suite 100 Anchorage, Alaska 99501 Re: Enforcement Action SCU 44 -33 — Corrective Actions SCU 44 -33 (PTD 212143) Dear Commissioner Foerster, This submittal is to provide the AOGCC with the requested corrective actions to be delivered by April 29, 2013 as mandated by the Order dated AprH 10, 2013 and received by Hllcorp Alaska, LLC on April 15, 2013. The corrective actionis included for dekvery by April 29, 2013 as requested by the AOGCC are as follows: 1. A detail description of the Hilcorp's regulatory compliance program with detail on MOC procedures to kiclude triggering criteria for the MOC, approval of change and communication of those changes to AOGCC and execution Team. 2. A Root Cause Analysis was performed for each of the violations noted in the Enforcement Letter for SCU 44 -33 and is included with the Comprehensive List of Causes utilized to determine the immediate causes and possible system causes. The corrective actions hst with "Who Is going to do What to or for Whom by When is included for review. 3. The final corrective action for Hiloorp to provide evidence of trainkig for personnel responsible for the many different areas of compliance to AOGCC regulations kicludinig permitting, well site supervision, follow up reporting and documentation will be delivered on May 3, 2013 as requested. The civil penalty payment will be made by Hilcorp Alaska, LLC with the final submittal of information to the AOGCC on May 3, 2013. if you have any questions, please contact me at 777 -8369. Sincerely, ( 20G 4 - / Paul Mazzolini Drilling Manager Hllcorp Alaska, LLC Page 1 of 1 • Incident Review Report Incident: Violation of Alaska Oil and Gas Conservation Commission (AOGCC) Regulations while drilling Soldotna Creek Unit (SCU) 44 -33 Date /Time of Incident: Violations occurred while drilling SCU 44 -33, spud date Oct 11 2012 Location of Incident: Swanson River Field, SCU 44 -33 Incident Description: Hilcorp Alaska, LLC (Hilcorp) violated provisions in; • 20 AAC 25.015 "Failure to notify AOGCC of changes to an approved permit to drill ". • 20 AAC 25.035 "Failure to test BOPE after use for well control purposes prior to next welibore entry ". • 20 AAC 25.033 "Failure to maintain the welibore in an overbalanced condition ". Incident Investigation Participants: (Luke Keller — Drilling Engineer, Paul Mazzolini — Drilling Manager, Kate Kaufman — Environmental Regulatory Compliance Specialist, Ed Thorsby — EH &S Training Coordinator). Facts Bearing on the Incident: 1. Hilcorp was granted approval to drill well SCU 44 -33 in Permit to Drill (PTD) 212 -143, dated October 3, 2012. 2. Sidetrack operations of well SCU 44 -33 commenced October 11, 2012 using Doyon Rig 1 (aka Doyon Arctic Fox). 3. Hilcorp commenced sidetrack drilling of well SCU 44 -33 at a depth shallower than approved in the PTD; in violation of provisions in 20 AAC 25.015 "Changes to a program in a permit to drill ". The PTD specified 9,500' MD. Actual sidetrack depth was 9,001' MD. 4. Hilcorp commenced sidetrack operations using a mud density less than approved in the PTD; in violation of provisions in 20 AAC 25.015. The PTD specified 10.6 ppg mud density. Actual mud density was 9.5 ppg. 5. Hilcorp failed to maintain the welibore in an overbalanced condition; in violation of provisions in 20 AAC 25.033. After sidetracking the well, the mud density was increased to 12.5 ppg to stabilize the lower Tyonek water flow, which was not expected to be encountered at this depth or in this part of the field. 6. Hilcorp closed the BOP when communication with the lower Tyonek water flow was established to prevent further influx while the mud density was increased. • • 7. Hilcorp tripped its drilling assembly to the surface of well SCU 44 -33 to change out the bottom hole assembly and returned to bottom and continued drilling operations without testing the BOPE used for well control; in violation of 20 AAC 25.035 "Secondary well control for primary drilling and completion ". Findings of the Root Cause Analysis Incident Investigation: Immediate Causes: 1 -2 Violation by Group - Drilling Team commenced sidetrack drilling without prior notification to the AOGCC of the changes to the PTD. 4 -1 Improper Decision Making or Lack of Judgment - Drilling Team incorrectly decided that changes to PTD were immaterial and proceeded with sidetrack drilling without seeking approval for changes to the PTD. 6 -3 Improperly Prepared Equipment- After tripping out of the hole to change the bottom hole assembly; the Drilling Team failed to test the BOPE prior to continuing drilling operations. System Causes: 14 -4 Inadequate Enforcement of Policy, Standard or Procedure: a. Drilling Team made changes to the SCU 44 -33 well plan, specifically with regards to the Kick -off Point and mud density, and did not provide notification to the AOGCC of these changes to the PTD. b. Drilling Team did not maintain wellbore in overbalanced condition. c. Drilling Team failed to test BOPs prior to next wellbore entry after using the BOPE to shut in on a well flow event. 14 -5 Inadequate Communication of Policy, Standard or Procedure: a. Drilling Team did not fully understand or recall specific regulations related to changes to approved PTD. An incorrect decision was made that the changes were immaterial and did not warrant AOGCC notification. b. Drilling Team did not recall the specific regulations related to testing BOPE prior to next wellbore entry after using them in a well control situation. 8 -2 Inadequate Leadership - Standards of Performance missing or not enforced a. Anchorage Drilling Team communicated the changes to the approved PTD to Drilling Foremen but did not understand the need to provide notification to AOGCC of changes to the approved PTD. • • 7 -2 Inadequate Recall of training material & 7 -3 Inadequate Training Effort a. Drilling Team did not fully understand or recall specific regulations related to changes to approved PTD. An incorrect decision was made that the changes were immaterial and did not warrant AOGCC notification. b. Drilling Team did not recall specific regulations related to testing BOPE prior to next wellbore entry after using them in a well control situation. Corrective Actions: (For each numbered System Cause, i.e.; 14 -4, 14 -5, 8 -2, 7 -2. 7 -3) 14 -4, 14.5, 8 -2 a. Drilling Engineer increased level of communication with AOGCC regulators (Beginning Nov - 2012). Even small changes to PTD are communicated to AOGCC regulators via email. If a formal 10 -403 is needed this is prepared immediately afterwards. b. Drilling Engineer submits entire Drilling Program (instead of drilling operations summary sheet) to AOGCC regulators along with 10 -401 PTD (Beginning Nov - 2012). This prevents additional, uncontrolled documents from being distributed. c. Drilling Engineer includes a "Regulatory Compliance Requirements" section in the drilling programs distributed to Drill Team (Nov- 2012). This document is reviewed and understood by all members of the Drilling Team. d. Hilcorp Alaska, LLC has adopted a "Regulatory Compliance Program" which includes a detailed MOC process to track and communicate changes to approved PTDs (Beginning Nov — 2012). 7 -2, 7 -3 a. Drilling Manager distributed electronic AOGCC & BLM Regulation Compliance Training to drill team members (12/13/2012). A spreadsheet is maintained to track review and understanding of AOGCC & BLM regulations and any guidance documents /update submitted. b. Regulatory Compliance Training will be provided for office personnel responsible for PTD and sundry preparation on April 30, 2013. An agenda and sign in sheet will be recorded as evidence of the training. A follow up session will be necessary for those that are unable to attend. c. AOGCC Guidance Bulletins are communicated with a request to review and send a response that the document is read and understood. If there are questions they are discussed with the Drilling Engineer or Manager. • • arililn Mana�eement of Change rl "li A cornerstone of a successful drilling operation is a well plan that is detailed, clearly written and effectively communicated to all parties that are responsible for directing.and supporting the executlon•of the plan. Once approved by the Drilling Manager this Well Plan becomesthe vehicle that will be the basis to gain regulatory approvals and guide the development of the daily plan utilized to execute the drilling operation. The critical nature of this document requires a systematic approach for making and communicating revisions to include the•foflowing: 1. Description of requested revision 2. Technical &operational evaluation 3. Acceptance or rejection proposed revision 4. Manager or designee approval of revision with approval date 5. Determination of regulatory approval requirement 6. Date & method of regulatory approval 7. Inclusion of revision to Well Plan with name & date isee revision documentation page) 8. Revision with accompanying regulatory approval (if required) sent to officepersonnel & Drilling Foremen for further communication Material revisions to the Well Plan require discussion with regulating agencies such as the AOGCC and BLM and may trigger the requirement for a formal written notification andipproval process. Examples of material revisions for discussion with regulating agencies Include but -are not Hmited to changes in the foliowing: • - Drilling fluid density or type (WBM vs: OBM) - Casing design & setting depths - Directional drilling plan, anti - collision &. spacing exemption Issues - Cementing program, cement type or volume - Casing shoe or open hole FIT requirement - .Rote size tope drilled, if a material change to cement volume - Unanticipated geologic event encountered - BOPE pressure rating requirement - Wellhead system pressure rating requirement Drilling rig to be utilized to perform the work Engaging in proactive discussions with all stakeholders and any regulating.agencies before & during the MOC process is a key component to obtaining approval and then integrating into the original Well Plan to allow for a safe, compliant & operationally sound execution at the well site. • II Flilcorp Alaska, LLC Hilcorp Energy Company Changes to Approved Permit to Drill Date: April 12th, 2013 Subject: Changes to Approved Permit to Drill for SRU 24.15 File #: SRU 24 -15 Drilling and Completion Program Any modifications to SRU 24 -15 Drilling & Completion Program will be documented and approved below. Changes to an approved APD will be communicated to the AOGCC & BLM. Section Pag Date Procedure Change Approved Approved e By By 7.0 7 1 -29 -13 Added "Variance Requests" section for variance requests LK PM from BLM. 7.0 7 1 -29 -13 Requested Variance from BLM Onshore Oil & Gas Order LK PM #1: Installation of HCR in lieu of check valve in kill line. 7.0 7 1 -29 -13 Requested Variance from BLM Onshore Oil & Gas Order LK PM #1: Allow use of co -flex choke and kill lines. 5.0 5 3 -7 -2013 Modified well schematic to show deeper 7 -5/8" casing LK PM shoe 9.0 11 3 -7 -2013 installation of 21 -1/4° x 2M diverter added LK PM 14 27 3 -7 -2013 Changed TO of 9 -7/8" hole section to 10,750' MD LK PM 16 30 3 -7 -2013 7 -5/8" Cmt program modified to reflect deeper csg shoe LK PM 19 40 3 -7 -2013 5" Cmt program modified to reflect deeper csg shoe LK PM 30 55 3 -7 -2013 Casing design info modified to reflect changes LK PM 33,34 3 -18 -2013 Directional plan revised. P4 is planned welipath. Only LK PM change is removal of the surface nudge from previous plan. 4 -8 -2013 7 -5/8" intermediate casing set at 9576' MD due to hole LK PM integrity / lost returns issues. 4 -8 -2013 Cmt volume for 7 -5/8" intermediate casing remained same LK PM as approved on APD. This results in 80% excess instead of 50 %. Displacement fluid will be FW. 4 -8 -2013 Cem Net (Lost Ciro Material) will be added to the first 25 LK PM bbis of lead cmt and also the leading edge of the tall slurry. 4 -8 -2013 MW for drilling the 6 -3/4" hole section is increased to 10.5 LK PM ppg instead of 9.5 ppg. LK PM 4 -8 -2013 FIT @ 7 -5/8" casing shoe increased to 13.0 ppg 4 -8 -2013 Well TD revised to 11,710' MD / 11,458' TVD. LK PM ( Ai Approval: , i 0 ‘.. ,' 2-, zo 3 Drilling Manager / Date Prepared: Lk /41 1e,-- 11,2 //gt?1 Drilling Engineer t Date SOU 24 -15 Changes to APD Mar 2013 • • 1 II 1 Hilcorp Alaska, LLC Hilcorp F.nc Company Changes to Approved Permit to Drill Date: Nov 20, 2012 Subject: Changes to Approved Permit to Drill for SRU 13 -27 File #: SRU 13 -27 Drilling and Completion Program Any modifications to SRU 13 -27 Drilling & Completion Program will be documented and approved below. Changes to an approved APD will be communicated to the AOGCC & BLM. Section Page Date Procedure Change Approved Approved By By 25 45 12/11 Added section thickness to geo- prognosis. LK PM 22 42 12/11 Revised BOP schematic to denote choke and kill line LK PM configuration. 4 4 12/11 Added wording concerning condition of casing /tubing run LK PM into the well. 16 30 12/11 A temp log will be run after running the 7 -5/8" intermediate LK PM casing. 9 10 12/11 No diverter system will be used, a diverter waiver is LK PM requested. /, t c Approval: / f Zo,z. Drilling Manager / .1 Date i j /iK i L Prepared: , ,,/,(_ , / / r 2 1 / t /20 Drilling Engineer Date SCU 13 -27 Changes to APD Nov 2012 • • Hilcorp Alaska Methodology for Compliance with AOGCC Regulations AOGCC's regulations and regulatory requirements cover all aspects of Hilcorp Alaska's (Hilcorp) daily Cook Inlet operations and therefore compliance with these regulations is a shared responsibility within the Hilcorp Team. An overview of each Team, responsible position(s), and the method of monitoring and compliance reporting to the AOGCC is as follows: Drilling Team Build and submit all Permits to Drill (PTD) and required Well Completion Reports. This work effort is led by the Drilling Engineer with the support of the Drilling Technician. The Drilling Manager reviews documents prior to submittal to AOGCC. Well operational updates for sundry notice well work and the PTD are submitted each week. The Asset Team's Regulatory Technician generates sundry well work updates and submits them to the Drilling Technician. These updates are then compiled with PTD wells and submitted to the AOGCC. A regulatory tracking spreadsheet is updated each week by Drilling and the Asset Teams. The spreadsheet is reviewed by Managers to ensure compliance from both the information aspect and required timing of submittals. The regulatory tracking spreadsheet (example attached) includes the following information: Well Name Well work description Spacing Exception required Proposed start of work Submittal & approval dates for each type of work request (401, 403, etc...) Work end date Date post filing due Date 404 or 407 submitted Date data submitted to DNR Asset Teams Build and submit all Sundry Notices and production information required for the Well Completion Reports. This work effort is led by the Operations Engineer with the support of the Regulatory Technicians. The Operations Manager reviews documents prior to submittal to AOGCC. Well operational updates for sundry notice well work are submitted each week. The Asset Team's Regulatory Technician generates sundry well work updates and submits them to the Drilling Technician. These updates are then compiled with updates to PTD wells and submitted to the AOGCC. • • Updates from the Asset Teams for the regulatory tracking spreadsheet are sent to the Drilling Technician. The tracking spreadsheet is revised and reviewed by Managers to ensure compliance from both the information aspect & required timing of submittals. Weekly Rig BOPE test schedule is generated by Operations Engineer with input from the Asset Teams and Drilling and is submitted at the end of the prior week to AOGCC (example attached). The MIT's for special case wells (waivered wells) are tracked separately (example attached) by Sr. Regulatory Compliance Specialist, so that they are more closely monitored in between tests. The standard wells which require MIT's have been added to the spreadsheet as a backup to the EAM system. Facility Engineering Identify and manage new construction and /or changes to existing facilities that have the potential to require AOGCC notice and /or approval through our Management of Change (MOC) process. Facility Engineers within the Asset Teams or Project Managers within the Facilities group shall use the MOC tool to screen and identify individual projects for AOGCC requirements. Operations and subject matter expert MOC reviewers will provide additional scrutiny to the projects. Asset Team Leaders, Operations Managers, or the Facility Manager shall provide final approval of the MOC and screening for AOGCC requirements. The MOC tool was recently revised to specifically reference and highlight AOGCC requirements. Field Operations The Drilling and Workover Foremen communicate with the AOGCC at a minimum of 48 hours in advance for the notification of BOP tests as now required by the regulations. The required test form with time / pressure recorded chart are submitted to AOGCC following the successful completion of the test. Compliance activities and reporting also extends to Production operations for testing well (MIT) and surface safety valve system (SSVS) integrity. Hilcorp utilizes a computer program (EAM) to track and schedule preventative maintenance for all facilities (example attached). This program also tracks the required interval for the testing of SSVS's and MIT's. Production Accounting receives information from Production field personnel on volumes of drilling fluids and cuttings injected in permitted disposal well(s) and reports volumes to agencies on a monthly basis. Attachment #1 Regulatory Tracking Spreadsheet Attachment #2 Weekly Rig BOP Test Schedule Attachment #3 EAM Preventative Maintenance Printout Attachment #4 Waivered Well MIT Tracking Spreadsheet Attachment #5 Management of Change Program Review • Attachment 1: Regulatory Tracking Spreadsheet I Last Updated: ® Sundry Tracking for AOGCC Spacing C ' yq Exception Proposed 10-401 10-401 10-403 10-403 10.400 10 -407 404110.4 7 j Well Name e AFE # Description If Job End Date Past p yes enter Job Start Date Dale Date Dele Date Date to DNR 70 Notes Filing Due g Dale Date Submitted , Approved Submitted Approved Submitte Submitted days after • • Approved lob D -16R0 Pending Convert from Injector to Producer 11/15/12 N/A N/A N/A N/A Future Pending Pending N/A TEI0 • I SD -05 135072 Perforate and Install Cap String ' 02/12/13 N /Ai N/A 02/08/13 02/14/13 Future Future Future N/A '. SD -02 . 1320552 Plug -back, Pull Tubing, Complete and Perforate 02/14/13 N/A N/A 02/05/13 02/13/13 4/23/201 9 Future Future N/A 11 I_ �� SRU 24 -15 1212877 Completion (Chad's) 02/15/13 WA N/A Pending', Pending Future Pending N/A DRILL TOD 1' ^7 1WSB Ns* a DI ng with completion schematic. • SRU 24 -15 1212877 New DO '', 02/15/13 01/15/13 02/05/13 N/A N/A Future Pending N/A Pending N/A PTO #213 -007 API# 50 20609 - 00;4000 psi BOP; SCU 31 -08 1222653 WO, Install Ratlines rod pump unit, RTP 02/20/13 N/A N/A 02/10/13 02/22/13 03X11/1 04/01/13 Pending N/A TBD stabilization (due 2 months after - 8/1/13). BCU -05RD 1350848 IM Fishing - Working 03/01/13 N/A N/A N/A N/A Future Pending Pending N/A G -07 1221772 Pull GL completion, den out to POD. perforate GZ 0 NB, Run ESP 03/01/13 N/A N/A 10X13/12 10/12/12 Future Pending Pending N/A TBD Test BOP to 3,000 psi / 10-404. '31.1-093: ,' -. -1. _ / 30u0 psi HOP - NO How lest alter SCU 41A-08 1222643 WO, Install Rotatlex rod pump unit, enhance production 03/01/13 N/A WA 02/22/13 '. 02/27/13 03/12/13 04/12/13 Pending N/A TBD stabilization (due 2 months after - 6/6/13). j BCU -01A 1320742 Cap String Removal 03/08/13 N/A WA N/A • N/A 03/08/13 04X18113 Pending N/A BCU -09 1320855 Return to Production d Piping Upgrades . Flow out of tubing pi 03/08/13 N/A j N/A N/A N/A 03/08/13 01/08/13 Pending N/A TOD 77 GP 11 -13R0 1320635 Pump xylene 03 /08 /13 N/A N/A 02/19/13 02/22/13 0405/13 05 /05/13 Pending N/A TOO : _ Subsequent 10 -404 HVA -03 1320655 Acid Stimulation 03/06/13 N/A N/A 04105/13'. 04/11/13 Future Future Future N/A • SD -07 1320802 Plug -back, Pull Tubing, Complete and Perforate 03/12/13 N/A N/A 02/05/13 I 02/13/13 Pending Future Future N/A • BA -04 Pending Tubing Patch 03/21/13 NIA N/A 021'28/13 03 /04/13 0327/13 04/27/13 Pending N/A TO W4lnassetl MIT - IA after stabilized injection / Srentlent 1(1 -4n4 CLU -05 N/A Run Cep string 03/21/13 N/A N/A 03/18/13 i 03/20/13 Future • Future Future i N/A A -21RD 1320028 C/O well, new tubing, add pees 03/25/13 N/A N/A 0122/13 01/30/13 Future Pending Pending N/A TOD 2,500 psi BOP Test/ Operations contingent on 1 Cnmmkcim do Meneelk S / Subs/ math! 10.404 SCU 33-5 1320331 WO, Recomplete Lower to Hemlock 03/25/13 N/A N/A 03/15913 1 1 0320/13 00/31/13 4/31/13 Pending N/A TBD' : 313 - 135; 10404 /26001m BOP 1500 psi Mmdr G -03RD2 1221773 i'....:•.• :, Pull 4 -1/2 GL completion. Isolate Hemlock, perforate G -Zone, Run 04X11/13 WA N/A 03/18/13'1 04/03913 Future Pending Pending N/A TBD Test BOP 3000 pal /T Annear le 2500 psi/ • 04/05/13 313 -161; 10-404/3000 11009 SCU 32-08 , 1351079 Rod Pump Repair 04814/13 N/A N/A 04 /02/13 Future Pending Pending NIA TBD Verbal OCU - 04 1350849 Roperforate 04/08/13 N/A N/A 04/02/13 04 /05/13 04/15/13 05/15/15 Pending N/A TBD 313 - 162,1')•.,4 G -17RD 1221775 Pull 3 -1/2" GL completion, perforate G -zone and He, Run ESP - 0408/13 N/A N/A 11/26/12 11/29/12 Future Pending Pending N/A TBD BOP Teal to 3,000 psi CLU -08 1351080 Remove and Replace Streddte Packer 04/08/13 N/A N/A 04 /02/13 04 /05/13 Future Futuna Future I N/A SCU 14-34 1321103 Recomplete Lower to Hemlock 04/10/13 N/A N/A 04 /04/13 04 /09/13 Future i . Pending Pending N/A TOD 313- 166; 10-404 / 3000 psi BOP ET 4111 SCU41A -04 1310631 New Drill 04/12/13 02/25/13 03/14/13 N/A N/A Future Pending N/A Pending TOD #213-028; API 50-133- 10109 -02 -00 1 SCU 41A-04 1310631 Completion (Chad's) 04/12/13 N/A WA Pending Pending Future Pending N/A DRILL TBD 10- 407 /4001 aupply Drilling with completion athematic. SCU 42 -04 1310631 P6A for Sidetrack = SCU 41A -04 04/12/13 N/A N/A 02/25/13 , 03/14/13 Future Pending N/A Pending TOD ` # 313 - 098; 10- 407 / 3000 pot BOP 3000 psi Casing KDU 02 Pending 04/14 /13 N/A N/A 0408/13 04/11/13 Future Future Future N/A BA -32 Pending Add peas and Install tubing patch 04 /15/13 N/A N/A 04/03113 04/11/13 Future Pending Pending N/A TBD I Subsequent 10 -404 O -07RD2 Pending Add StImulatidn 04 /15/13 N/A N/A 03/15/13 03/22/13 04 /04/13 05 /04/13 Pending I N/A TBD Subsequent 10- 404 / Need WSR's- work done on - u '/.SUU pal BOP I est / 0.6s11g test to 1,590 pie IND A-07 1320656 W/O Wen/ Install ESP '.0422/13 N/A N/A 02/07113 03 /08/13 Future Pending Pending N/A NA Flow lest after stabilized production /Subsequent l) G -02RD 1221774 Pull GL completion, dean out to POO, perforate HB 8 G -zone, Run ESP 04/29/13 N/A N/A 11/30/12. 12/12/12 Future Pending Pending N/A TBD Test BOP 3,000 psi /Nol Flow test sear stabilized I _ _ _ errnNxslaa 1 • • Attachment 2: Weekly Rig BOP Test Schedule (Example) • Weekly BOPE Test Schedule I/ By: Rig, Location, PTD #, & Sundry # Start: Sat 04/27/13 End: Fri 05/03/13 D Williams 404 Williams 405 Monopod Doyon Arctic Fox Cloverleaf ay Rig #5. Drilling , Eaktis „. Saturday Wet. Sundry PTDt Sunday Sundryi PTD Monday Well: 't Sund PTD Tuesday Wednesday Sundry PTO,: Thursday Sundry PTO; Friday Well: Sunder PTD: *Approximate Schedule only, this is not to be used as a substitute for official notification. 1 1 • Attachment 3: EAM Preventative Maintenance Program (Example) • . i nto LAM Print Work(bd ( unqucl ir.ov, • Work Order 24203 DV- OPERAlOR ' � • v '' ON WELL Scheduled Start 1 1412012 D -24A WITNESSED BY STATE AOGCC REP Schodutod End 09/10,`2012 Created By R6 Onto Created 00/10/2012 Status CLOSED (History) Roprint _ WO Typo PMC __ Paront WO -- PMC Compliance Class A0OCC Department DOLLY Priority 0 Dolly Varden Platform - CIO Warranty PM Schedule A- DV- O•C•0014 Safoty DV- OPERATOR 4 -YEAR MIT TEST ON WELL D -24A Equipment Criticality 3 WITNESSED BY STATE AOGCC REP Cost Code Assigned To DV-OPS Reporter! 13y Probtom Codo Assigned 13y Multiplo Equipment No Project Campaign Campaign Event Standard WO Date Started Date Completed 00/31/2012 limo Completed 00:00 Equipment WWELL -0 WELL; WATER INJECTION D -24A Manufacturer Model Serial Number Location Reliability Ranking Reliability Ranking Scoro Reliability Ranking indox CANDERS° 012 08 :201: C 8.31.2012, rscoTr(03 /x7/2012 17:281: • Reminder: Havo a calibrated test guago available for tho MIT prossuro test. For standard MIT: Any quosiions, call the Reservoir Enginoor (various) or MIT Coordinator (Larry Greonsteln x7001) Conduct official Slato witnessed MIT 1) Call tho State at least 24 hours In advance to schedule /request an inspector to wltnoss MIT (Jim Regg Q 703-1236) 2) Conduct a Safoty Mooting 3) Record all prossuros on woil (Injecting or shut -In doesn't matter, but injecting Is preferred) In "Pretest' cells on MIT form 4) f=lit 1st annulus with fluid to begin prossuro test (mothanoi, diesol, water, packer fluid, etc, your proforonco) 6) Pressuro up 1st annulus to desired lost pressure (.26‘TVD of pkr depth). 0) Record all prossuros on well In "Initlol" cells on MIT form 7) After 16 minutes, Record all pressures on well In 16 Min" colts on MIT form 8) After 16 more minutes, Record all pressures on wolf In "30 Min" cells on MIT form 0) If stet() witness present, Request signature and pass /fail ovatuatlon for MiT form, othonviso Roport "wltnoss Not Prosent ". • 10) Roturn annulus pressure to pretest reading 11) Send completed form to the Resorvoir Engineor and MIT Coordinator - NOT THE STATE - (electronically, hard copy, scanned, oto) 12) Ctoso work order in EAM, • 0 E r f o r EI1V1 Print Work Order - Comprehensive Activity Activity 1 � 2 ° 6 #., m r, Trado OPS Operations (All Levels) Activity Start 0910412012- - Dato Estimatod Hours 8 Activity End Dato 09/04/2012 People Roquired 1 Employee /Crow Date Time On Timo 00 Total Tlmo Typo of Hours 04127/2013 11:20 1 III.CORP ENERGY COMPANY Pauo 3 • • I nfor EAM Print Work Order 11 Work Order 14673 KS OPER 180 DAY WELLHEAD SAFETY TEST WITNESSED BY Scheduled End ate 04/09/2012 AOGCC Created By JMABREY Status CLOSED (History) Created 02/28/2012 Parent WO WO Type PM Department KING Class AOGCC King Salmon Platform Priority 0 PM Schedule A- KS -O -5 -0003 Warranty KS OPER 180 DAY WELLHEAD SAFETY TEST WITNESSED BY AOGCC Safety Cost Code Equipment Criticality Assigned To KS -OPS Problem Code Reported By Assigned By Project Multiple Equipment No Date Started Standard WO Date Completed 05/03/2012 Time Completed 15:29 Campaign Campaign Event Equipment KING PLATFORM; KING SALMON Manufacturer Model Serial Number Location WO /PM Comments DNJAA [05/03/2012 15 :28] : This WO was completed 4 -11 -2012 J MA G R E Y [02/14/2012 15 7]: M- KS -O -S -0003 12/07/2012 14:00 HILCORP ENERGY COMPANY Page 1 • 1 nfoA EAM Print Work Order 11 Work Order 14673 Activity 1 !Trade OPS Operations (All Levels) Activity Start Date 04/03/2012 Estimated Hours 12 Activity End Date 04/03/2012 People Required 1 Booked Hours 4,441.,... k,. ,,,kim nwiw .. A _. u. Employee /Crew Date Time On Time Off Total Time Type of Hours Instruction List Task A- AN- O- OSEFLD -009 0 Work Order 14673 Activity 1 Description AN WELLHEAD PRESSURE SAFETY INSPECTION Comment JMA BREY [03 /05/201216.:511. 1. Schedule a state representative, at least 24 hours prior to a test, to witness tests at least twice annually. AOGCC Contact: Jim Regg, Inspection Supervisor, jim_regg @admin.state.ak.us 793 -1236 » »Note: Contact by email in order to have a notification trail for backup. «« Website for additional info: http: / /www. state .ak.us /adminfogc /homeogc.htm 2. Perform the SSV and /or SSSV testing in accordance with AOGCC Policy 20AAC25.265. 3. Note results of test on the, "Safety Valve and Well Pressures Test Report ". » »Note: It is Chevron's responsibility to document and maintain a record of its SVS test results. 4. Send a copy of the test to: Alaska Oil & Gas Conservation Commission 333 W. 7th Ave., Ste, 100 Anchorage, Alaska 99501 Voice (907) 279 -1433 Fax (907) 276 -7542 5. If no test fails, complete work order in EAM (D7i) using action code "SCI" with closing comments that SVS test performed with no problems. 6. If a test fails, make notifications to AOGCC in accordance with SVS Failures 20AAC25.265. * Note: Valve must be repaired or replaced and ready for retest within 2 weeks. If repairs cannot be made within 2 weeks, notify AOGCC of the need for well shut -in. 7. 24 hour notification for witnessing a retest must be made to AOGCC when; a) repairs are completed after a failed test, or b) well restart after a shut -in. 1 ! 8. Complete work order in EAM. Write follow up work request to track substandard conditions found, Make sure to follow step 6 if test fails. k W "" a . a;e aywk .yaw S,C e .. ��c , . 4 � yy\ a4 4 �� \��V ,�,, `w Oa�� \1� \4��, x.A�A� 12/07/2012 14:00 HILCORP ENERGY COMPANY Page 2 Attachment 4: Waivered Well MIT Tracking Spreadsheet (Example) I 1 . , I 1 1 I • 1 l Condition AC t Date ' Term Duo i Platform Permit I Well 0 API # of Well Comments Status of well :LaSt MIT (years) Date v 1 i (St Of AcT) 1 0 .. _. Monopod 197-067 A-8R02 '50-733-20043-02 ACTIVE :05118111 4.00 yrs. 05/15 . Leak 7/12199 Baseline Temp Survey 2118/01 MIT SI MIT Approved 4/10/03 w/ Temp Log 5117/02. lo end of 3rd Or 2003, AOGGC neecs assesstnem e fut.. is Monopod 171-029 A-12RD 50-733-20076-01 !SI -7/84 1:8028/05 '2.00 yrs. . LTSI re utter Ran , l , temp survey 6/28/05. Sent assesstrent 9'6.'05. Sent 1 i continuation of Shut-1n 1 /9/06. i Occovered cornrnunrcabon and shut i. Mono-pod 136-001 A-19RD 50-733-20151-01 11010305 2.00 yrs. n well 7/24/06 Received LTSI TS Wall won't take any water. Admin Approval 12.001 on 11/2/06. Monopod 188-137 A-25RD 50-733-20242-01 ACTIVE 109/27J09 .4.00 yrs. 09/13 i MIT 1 Time extention granted to 9/1/02. Planned retina candidate wo 1 Monopcd 171-020 A-26 50-733-20230-00 l iSI .2/78 0629:05 2.00 yrs. LTSI Hai is writing letter to Tom. Ran temp survey 8/29/05. Sent a 1 , , ConfinuaSon of Shut4n 1/9/06. ! , Received Adrnin Approval 12.002 on 3/23/09. Comr,...1.ance 'MoIl 40/reletIOrl (I10 WW1. special requirements for Monopod 202-004 A-29RD 50-733-20245-01 VARIANCE 03/19111 2.00 yrs. 03113 anri,versafy Is 3118109 TS MIT . see leder dated 8/1/2002. NOWON AA - 3123109. S • • Attachment 5: Hilcorp Alaska Management of Change Program Overview • • HAK Management of Change Standard I. PURPOSE The purpose of this program is to ensure that hazards associated with the introduction of changes are properly evaluated and addressed from the planning through implementation stages within Hilcorp Alaska LLC (HAK), Oil & Gas Operations. II. SCOPE / APPLICABILITY This Standard must be followed prior to the introduction of a change to — HAK -owned rigs — Wells — Rig support systems — Operating procedures — Structures & equipment — Process technology — Piping — Chemicals — Control logic — Operating parameters that are beyond — Maintenance procedures established safe limits — Maintenance activity other than replacement in kind Replacements in kind are excluded from this standard. The MOC Screening Form should be used to determine if a change triggers the MOC process. III. MANAGEMENT OF CHANGE PROCESS Changes to Facility, Process, Process Conditions or Procedures The HAK MOC Sharepoint Tool and all MOC forms and templates are located on the HAK intranet site under "EH &S ", "Management of Change." The MOC Screening Form should be used to screen whether a change or modification should be managed using the MOC process. If necessary, the MOC should be generated and approved prior to a modification or change. To be of value, the MOC must be initiated and processed during the planning stages of the change. Project complexity or the existence of an emergency situation determines the degree of offsite approval necessary prior to implementation of the proposed change. In the event of an emergency response as determined by the Operations Manager or Incident Commander, a change may be undertaken without a pre- approved MOC. However, an MOC should be generated immediately following the emergency action. An emergency response does not negate the requirement for completed Pre - Startup Checklists, as appropriate. The MOC flow chart depicts the correct steps to process the MOC. The Sharepoint tool guides personnel through their respective tasks once the initiator submits an MOC in the MOC Sharepoint tool. Page 1 • • HAK Management of Change Standard IV. MOC- Related Responsibilities A. Initiator 1. The initiator is responsible for initiating the MOC process in the Sharepoint Tool by completing the "Request MOC Form" online. 2. The initiator will complete the MOC Screening Form as necessary to determine if an MOC is required. If they already know an MOC is required they do not need to fill out the form. 3. The initiator will attach any appropriate supporting documents to include redlines, updated procedures, cut sheets, etc... B. Production Foreman 1. The Foreman is responsible for reviewing and approving the work on their respective facility. If they deny the MOC it is cancelled. 2. The Foreman selects an MOC Team Lead to lead the MOC process through completion. 3. Prior to start-up, the Foreman may be requested to participate in a Hazard Analysis exercise. 4. The Foreman and the MOC Team Lead are jointly responsible for insuring that all personnel that could be affected by the change will be informed of the change and will be appropriately trained prior to start-up. The training should include any potential health and safety impacts, changes in operating procedures or changes in process safety information. 5. The Foreman may attach any appropriate supporting documents to include redlines, updated procedures, cut sheets, etc... C. Operations Manager 1. The Operations Manager is responsible for reviewing and approving the work within their respective field. If they deny the MOC it is cancelled. 2. Prior to start-up, the Foreman may be requested to participate in a Hazard Analysis exercise. 3. The Operations Manager may attach any appropriate supporting documents to include redlines, updated procedures, cut sheets, etc... D. MOC Team Lead 1. The MOC Team Lead is assigned by the Production Foreman and is responsible for the entire MOC process for the respective change. 2. The MOC Team Lead may attach any appropriate supporting documents to include redlines, updated procedures, cut sheets, etc... 3. The MOC Team Lead will select appropriate reviewers to review and approve the proposed change. Page 2 • • HAK Management of Change Standard 4. The MOC Team Lead will ensure all documentation is complete prior to initiation of work activities to implement the change and following completion of the work. 5. The MOC Team Lead is responsible for insuring implementation of recommendations noted in the HAZAN, as appropriate. 6. The MOC Team Lead is ultimately responsible for closing the MOC. E. Operations Manager, Asset Team Leader, or Facilities Engineering Manager 1. The Operations Manager, Asset Team Leader, or Facilities Engineering Manager is responsible for fmal approval of the MOC prior to initiation of the change. 2. This approval occurs after all individual reviewers have reviewed and approved the change. F. Reviewers (Operations, Engineers, Safety Specialist, Environmental Specialist, SCADA Supervisor, Metering Specialist, DOT Coordinator, etc...) 1. Reviewers are responsible for reviewing the MOC and noting required procedures and/or documentation required to make the change. 2. Reviewers may attach any appropriate supporting documents to include redlines, updated procedures, cut sheets, etc... 3. Reviewers will only approve the change after they have reviewed appropriate documents and /or listed the documents required to implement the change and /or to close the MOC process. 4. Reviewers shall be included, as appropriate, in the HAZAN process. V. ATTACHMENTS Appendix A — MOC Screening Form Appendix B — MOC Process Flow Chart Page 3 HAK Management of Change Process Flow Chart MOC Initiator completes "Request Yes Operations Manager, Yes MOC Form ", attaches MOC All reviewers approve and > AT Lead, or FE — Screening Form, Redlines. sign Section 5? Manager Approves? No V No Production Foreman V Denied performs initial Reviewers perform parallel approval MOC Team Lead approval and assigns and verify required documentation in ( provides additional E I Perform work J MOC team lead. Section 4 information W A Approved No Drawing updates required? • Yes V Denied Operations Manager V performs initial approval MOC Team Lead initiates Approved drawing as built updates (if pp applicable) by attaching updated drawing to MOC and communicating to Drafting Tech (Steve Carson) V MOC Team Lead completes Section V V 4 and completes and attaches MOC Team Lead completes Drafting tech updates HAZAN and Regulatory Screening and submits all Forms. MOC Team Lead selects documentation required in drawings and notifies reviewers in Section 5. Section 5 appropriate personnel A • V MOC Team Lead verifies completion and attaches all required No documentation to MOC. Send notification of action l< Is all documentation complete? Yes V V MOC Team Lead Yes Inspections reviews No I END. MOC Closed I closes MOC and documentation and gives signs Section 6 final approval? Rev 1 • • MOC REGULATORY SCREENING FORM (required) FACILITY: I MOC NAME MOC NO. Select from List Media Item Question? YES NO N/A 1. Does the project impact air, water, waste, land or fuel? 0 0 0 2. Does the project involve use of fresh water? L_I 0 0 3. Does the project involve moving land or use of waterways other 0 w than use of work boats in Cook Inlet? 4. Is the project off Hilcorp's leased land? • IN 0 5. Have you discussed this project previously with someone in the 0 0 0 Environmental Department? If yes, who? I I 6. Are you adding any temporary emission units? 0 0 0 7. Are you permanently removing any existing emission units? 0 0 0 8. Will the design of any fuel burning equipment be modified (e.g., fuel system, firing controls, compression ratio, burner size or 0 0 0 configuration? 9. Will the exhaust system, stack, or pollution control equipment for 0 0 0 any existing emission unit be modified? 10. Does the project involve changes to the method of operation that could result in increased usage of existing emission units or a throughout (e.g., debottlenecking or removing a capacity limitation, 0 0 0 changes in piping configuration, changes in control system configurations, changes in procedures)? 11. Does the project involve release, burning, or escape other than normal or incidental deminimus volumes of gas? If yes, review 0 0 0 20AAC25.235 for requirements and submit Form 10 -422 to AOGCC as required. 12. Will the fuel type, source blending or quality change? TI 0 0 13. Will we reduce air emissions through reduced fuel usage, 0 0 0 improved efficiency, pollution prevention, or pollution control? 14. Will the project effect discharges into Cook Inlet (including but not 0 0 0 limited to rerouting discharge piping, commingling streams, etc.)? 15. Does project involve sending waste to an onshore facility based 0 0 0 production wastewater treatment system? 15A Have the facility personnel been notified of the proposed 0 0 0 N commingling of fluids? 15B Has an evaluation been conducted to determine if the fluids may 0 El 0 a. cause an upset to the treatment system? 16. Does the project involve bypassing any portion of a treatment 0 0 0 system? 17. Are chemical treatment, usage, application, concentration, or 0 0 0 procedures being modified? 18. Does the project involve changes to the piping or tanks of the El 0 0 wastewater system? 19. Is Drilling performing required monitoring of drilling or work over 0 0 0 w discharges? If yes, who is responsible for monitoring? CI g 19A If Drilling is not monitoring drilling or work over discharges, has the 0 0 El project Foreman been informed of the discharge requirements? • • MOC REGULATORY SCREENING FORM (required) cont'd FACILITY: MOC NAME MOC NO. Media Item Question? YES NO N/A 20. Does the project involve sending E &P waste off the facility in containers? FM n n 21. Does the project involve sandblasting? 22. Does the project involve use of new chemicals at this facility? If yes, has n n n the purchase been officially approved? co 23. Are chemical treatment, usage application, concentration, or procedures n n n 1 being modified? 24. Does the project impact waste handling procedures? (Are you changing n n n the way you handle waste ?) 25. Does the project involve underground disposal of waste? If yes, review IEI n 20AAC25.252 for requirements. 26. Is the project located outside of a containment area? LI Li 27. Are liners being used in secondary containment for tanks and drums? 27A If yes, are you logging daily inspection of the secondary containment? n 1 cn 28. Are employees and contractors aware of spill notification and report 0 —i procedures? a cn 29. Are safeguards in place for prevention of spills (e.g., shutoff systems, 0 overflow alarms, etc.)? 30. Will any liner associated with an in- service tank > 10,000 gallons be n 0 n rendered inoperative for more than one 12 hour shift? Enter comments here. Please identify the item number for which you are commenting on: Completed By: Date: • S MOC SCREENING FORM (optional) FACILITY MOC NAME MOC No. Select facility from list 1. If the proposed change(s) meets any one of the guidelines below, MOC must be employed prior to implementing the work. No Categories Yes No 1. Facilities and Information Appearing on P&ID or NPDES Drawings: ❑ ❑ 1.1 Changes In flowline, pipeline or pipe size, specification or connection. 1.2 Changes to set points on safeguarding Instruments (alarms and shutdowns) relating to the safe operating limits. 1.3 Changes in equipment sizing or ratings. 1.4 Permanent removal of CSO or CSC designation on process isolation valves. 1.5 Changes in waste water routing or flow rate 1.6 Changes to any NPDES regulated effluent which include but are not limited to drilling fluids, deck drainage /storm water, sanitary wastes, domestic wastes, boiler blow down, fire control system test water, non - contact cooling water, excess water, flood water, and produced water. 1.7 Installation, changes, or modifications to a well's safety valve system. If yes, review 20AAC25.265 for requirements. 2. Changes in SOP`s or deviations from existing specifications for engineering ❑ ❑ equipment such as pumps, motors, valves, instruments, etc. 3. Changes to or permanently bypassing ESD /shutdown components and logic. ❑ ❑ 4. Changes to or permanently bypassing process control components and logic. ❑ ❑ 5. Installation, changes, or alterations to the eq, instrumentation, connectivity, layout, normal ❑ ❑ operating limits, calibration procedures, etc., on a sales gas or condensate metering system. If yes, review 20AAC25.228 for requirements and obtain AOGCC approval. 6. Any Welding Involving: ❑ ❑ 6.1 Installation of any hydrocarbon tank or pressure vessel and pressurized piping with the exception of water and air less than 150 psig design pressure. (No equipment in hydrocarbon service shall be installed without the approved FCR.) 6.2 Repair, Modification, or like -in -kind replacements to any hydrocarbon tank, pressure vessel or any regulated piping requires an approved FCR. 6.3 Attachments (minor or otherwise, temporary or permanent) to major structural members,- deck and jacket legs, deck truss and jacket braces, deck girders spanning between deck legs, or any steel component greater than 1 1 /4" in thickness. • MOC SCREENING FORM (optional) - cont'd FACILITY MOC NAME MOC No. Select facility from list 7. Structural Modifications / Additions: 0 0 7.1 More than 3 tons additional load (structure plus subsequent live loads) OR 7.2 More than 20 ft to the deck or walkway area. (In the event that work does not require FCR, as -built drawings shall be submitted to Drafting Coordinator for updates) • 7.3 Repair, modification or installation or a critical structural member. This should address any welding to a lifting device, trolley beam, personnel walkway supports, etc.) 8. Electrical Systems: 0 0 8.1 Changes and /or additions to the power generation and distribution system (switchgear, transformers, motor control centers). 8.2 Changes to the control logic. 8.3 Addition of equipment exceeding 75 kW power consumption. 9. Any additions, Relocations, Modifications or Removal of the Following 0 0 Equipment: 9.1 PSV's, safety equipment and systems (fire water deluge, fire detection, etc.) such as those included on Safety Equipment Layout and Escape Route drawings for the facility. 9.2 Equipment appearing on the P&ID's or plot plans. 9.3 Any electrical equipment permanently installed in an electrical hazardous area. 9.4 Any potential ignition source permanently installed in an electrical hazardous area. 9.5 Equipment exhausting or discharging hydrocarbons or other hazardous materials. 9.6 Maintenance activity that results in a change other than "in -kind" replacement 9.7 Mothballing, decommissioning, and abandonment. 10. Layout changes in enclosed areas (buildings, workshops, etc.) affecting points of ingress /egress, evacuation routes or electrical hazardous area classification CI 11. Changes to Process Fluids Including: 0 0 11.1 Hydrocarbon and utility streams 11.2 Heat transfer fluids 11.3 Lubrication and seal oils 11.4 Fuels for process equipment and prime movers 12. Any Modification, Structurally, Procedurally or Otherwise that has the 0 0 Potential Impact Helicopter Operations, such as; 12.1 Addition of an obstacles) to the helicopter approach / departure flight path; this includes both physical structures as well as exhaust gas and flare booms. 12.2 A layout change that would affect the way personnel embark / disembark to / from the helicopter. 12.3 Any modification to the size or shape of the helideck. 12.4 Addition of lighting that may interfere with helicopter operations. • • MOC SCREENING FORM (Optional) cont'd FACILITY MOC NAME MOC NO. Select facility from list 13. Changes to the status of a well (i.e.), does work involve abandoning, plugging, or 0 suspending a well? If yes, review 20AAC25.105 through 20AAC25.172. ❑ Completed by Date #s AOGCC Memorandum Date: November 7, 2012 To: SCU 44-33 (PTD 2121430) Other 80 From: Jim Regg, Sr. Petroleum Engineer Subject: SCU 44-33 Informal Review Informal review for the Soldotna Creek Unit (SCU) 44-33 notice of proposed enforcement was held on 11-7-12 at Hilcorp's request. Attendance list is attached. Summary of discussions follows; Hilcorp comments and discussion led primarily by Mr. Paul Mazzolini (Hilcorp Drilling Manager): Background Remarks - Drilling experience: 10 (Alaska experience); 5(from outside) - New company to Alaska; operate corporately out of Houston (local office in Anchorage); Gulf coast experience - Hilcorp is "troubled" by use of "disregard for AOGCC authority" in the notice - Understand now the magnitude of a change to approved plans that requires AOGCC further approval; was not clear before - Hilcorp does not want to be characterized as "aggressive" from negative perspective - Company "recognizes Macondo [BP blowout in GOM; 20101 has changed thing"; "don't have same flexibility as in past" o Note — AOGCC regulations notchanged because of Macondo incident as implied - Specific to SCU 44-33: o Past experience in area (drilling in 1960s) show operators drilled with 13ppg mud would would have never seen water flow zone that created problems o Water flow was fresh (low chlorides) and there were few logs available through this section in offset wells o Move up hole was intended to avoid the water flow zone (8700-9300 ft) o Gas storage zone in SCU is 5000-6000ft Failure to Notify - AOGCC was not notified because it was felt incremental changes were small in comparison to what was approved based on past experience of rig/engineering personnel - There is currently no formal Management of Change process for drilling program in Hilcorp — only for facilities; Hilcorp is currently working on a MOC for drilling to address this deficiency Failure to Test BOPE - Have not determined why BOPE used were not tested when first out of the hole after well control; likely a lack of training/knowledge of regulatory requirements - Hilcorp was advised of several other incidents where lack of awareness of regulatory requirements has created potential enforcement actions and burden on AOGCC to train field/rig personnel on-the-job Informal Review — SCU 44-33 Enforcement Page 1 of 2 o AOGCC requested to notify Hilcorp when encounter these situations in the field Corrective Actions - Beginning to address corrective actions listed in notice of proposed enforcement - Working on orientation program for personnel (Drilling; Production; Safety; Permits; Compliance) Addressing MOC process for drilling Developing regulatory compliance tracking sheet Performing root cause analysis - Training program that will go through AOGCC regulations - Pre -spud meeting will discuss compliance requirements; normally 2 weeks before spud Final Comments from Hilcorp - Concerned about AOGCC's perception of Hilcorp operations; Hilcorp intends to correct and seek AOGCC feedback - There is no disregard for AOGCC authority and regulations - Goal is a very active well work program; not aggressive in methodologies - Significant investment (expenditures) restore infrastructure; includes removing existing platform rigs, certification of BOPE stacks that were owned by previous operator Attendees Paul Mazzolini Hilcorp Drilling Manager Luke Keller Hilcorp Drilling Engineer Kevin Tabler Hilcorp Landman Larry Greenstein Hilcorp Regulatory Cathy Foerster AOGCC Chair, Commissioner Dan Seamount AOGCC Commissioner Tab Ballantine SOA DOL Assistant Attorney General Guy Schwartz AOGCC Sr. Petroleum Engineer Jim Regg AOGCC Sr. Petroleum Engineer Informal Review — SCU 44-33 Enforcement Page 2 of 2 44 _--, Hilcorp Energy Company DAILY DRILLING REPO REPORT NO._ LEASE WELL NO. COUNTY / PARISH WELL STATE DATE 35 A028399 & A028997 SCU 44 -33 SRF SCU 44 -33 AK 11/7/2012 RIG AFE NO. AFE AMOUNT DAILY COST CDC { CCC TOTAL CUM. COST RIG PHONE Arctic Fox 1212791 4018500 $57,250 $4,244,376 1 $4,244,3 907- 776 -6776 ACTIVITY TYPE: DRLG Drilling RD Rig Down DEPTH: MD/TVD PROGRESS / FIRS PROPOSED TD LAST SHOE TEST PPG 1 DAYS SINCE SPUD AFE DAYS FOREMAN I 12328 10/17/2012 26 34 Jimmey Greco ACTIVITY SUMMARY AT: 105:30 I HRS I SURVEY: MD ANGLE AZIMUTH ND SECTION N /S E /W DOG LEG Cleaning Pits I TIME LOG ELAPSED ACTIVITY COMMENTS FROM TO TIME 1114112-- 6:00 11:00 5.0 (drl)Trips Cont POOH LD 4" DP from 7884' to 3560', LD Swaco scraper assembly. 11:00 16:00 5.0 (drl)Trips Cont POOH from 3560', LD 2 7/8" HT PAC tubing. Cont injecting mud at G &I pad. 16:00 18:30 2.5 Install Wellheac Install tubing hanger w/ TWC and test @ 1000 psi _ 18:30 4:00 9.5 NU /ND BOPE 1 Rig down drip pan, flow line, koomey lines, choke & kill lines, nipple down BOPs I1,1 1 4:00 6:00 2.0 Install Wellhea. Install dead head tree, cleaning pits -_ I 1 TOTAL 24.00 LITHOLOGY: Hemlock _ MAX GAS ,J _ B.G. GAS 1 CON AS G ITRIP GAS L Accidents 1 Non e ' Pollution I Plan Next 24 Hr _ Report Attach 1 I Ri down MUD RECORD CASING RECORD PUMP 1 BPM TYPE 6% KCL _ DATA 1 GPM SIZE GRADE WT ]CONNI DEPTH DV ID NUMBER 1 2 TIME ,2:00 20 ELD_E_ 377 MAKE Garndner Denver Garndner Der DEPTH '12425 10 -3/4 J -55 40.5 3408 10.5 MODEL PZ -8 PZ -8 TEMP 65 7 -5/8 N -80 33.7 sEra 78 6.64 'STROKE 8 8 WEIGHT 8.70 7 -5/8 N -80 26.4 gipm 4621 6.844 LINER SZ 5.00 5.00 VISC 28.0 7 -5/8 N -80 29.7 TTRE' 6111 6.75 SPM PV TOP OF LINER @ 1 GAL /STK 1,96 1.96 YP BIT NO. ISUR .PSI 7_17 GELS BHA# SIZE API WL 9 MFG. 1 SLOW PUMP DATA @ HTHP DESCRIPTION OD ID FEET TYPE ' Pump # PSI 1 1 PSI 2 PSI 3 Eff % CAKE Bit 3.75 0.25 SERIAL NO. 1 I 96 SOLIDS Casing Scraper /Brust 4.88 1 12.88 NOZZLES 2 96 _ ADJSOL I 2 7/8" Tubing 2.88 2 3550 TFA - SPM for PSI 1/2/3 I OIL % XO 4.7 1.5 2.02 DEPTH OUT I DRILL STRING CAPACITY _ WTR % 97.2 3asing Scraper /Brust 6.94 1.5 17.33 DEPTH IN , BARRELS - SD % XO 4.88 2.375 1.71 TOTAL FT. STROKES MBT Drill Pipe 4 3.34 4316 HOURS POM XO 5 ; 2.5 1.62 AVG ROP pH ,7.6 Casing Scraper 5.38 1.5 6.81 WOB Pm XO 4.88 2.375 1.67 ANN VEL DEPTH PF /MF _ Drill Pipe 4 3.34 4378 ROT. RPM TORQUE _ Clmud AV DP CSG PICK UP Clwtr AV DP OP HLE ROTATIONAL Cal 30500 AV DC SLACK OFF LIME TOT CUM HR - _ %LGS GAUGE JAR HOURS ES INNER MUD MOTOR HRS OUTER LOCATION RP DULL CHAR. CUM HR BHA LIQ MUD 1 TOTAL LENGTH (FT) 3594.46 HYDRAULICS 1 FUEL 39 GAL ADD (DIESELGAL) TOT WEIGHT (LBS) DEPTH IFT CREW BOAT FUEL GAL SOLIDS EQUIPMENT NOZ.AREA IN POT. WATER 485 GAL SHAKER #1 Derrick 51' DRK 2 IIII d Pb PSI TUG FUEL _ 'GAL SHAKER #2 Derrick 51 BRDT HRS HHP BIT 0.8748 HP BARITE 490 SKS DERRICK #1 DRKS HRS H.S.I. HP /IN' FUEL USED 923 GAL _ MUD CLEAN CENT 0 HRS JET VEL FT /SEC HEAVY H2O 218 ,GA_L_ 1 BOP TESTED PERSONNEL ON BOARD IMP FORCE i _ WEATHER Misc 11/1/2012 HEC 11 %Pb I _ DAILY CUM NEXT TEST DUE RIG 24 BOATS _ WIND 5 MPH MUD _ 8,203.84 296,495.09 11/15/2012 SERVICE 12 MN - SEAS 1 TEMP DIESEL FUNC. DUE TOTAL 37 MN I IPRESCOND Clear TOTAL $296,495 i MN I FORECAST 2001 -2010 WellEz Information Management, LLC. All rights reserved ver 5.17.12bg A) Hilcorp Energy Company DAILY DRILLING REPO!' REPORT NO. LEASE WELL NO. COUNTY / PARISH WELL STATE DATE 34 A028399 & A028997 SCU 44 -33 SRF SCU 44 -33 AK 11/6/2012 RIG AFE NO. AFE AMOUNT DAILY COST CDC CCC TOTAL CUM. COST RIG PHONE Arctic Fox 1212791 4018500 $119,538 $4,187,126 $4,187,126 907 - 776 -6776 ACTIVITY TYPE: DRLG Drilling POOH Pulling out of Hole DEPTH: MD/TVD PROGRESS / HRS PROPOSED TD LAST SHOE TEST PPG DAYS SINCE SPUD AFE DAYS FOREMAN 12328 10/17/2012 25 3 Rance Pederson ACTIVITY SUMMARY AT: 105:30 HRS SURVEY: MD ANGLE AZIMUTH WO E SECTION N /S E / W DOG LEG POOH LD 4" DP at 7884' TIME LOG ELAPSED ACTIVITY COMMENTS FROM TO TIME It 11)I(S 6:00 7:00 1.0 Circ & Cond Cont CBU with 11.5 mud. at 12,288'. Rotate and recip 168 gpm -2600 psi, 40 rpm 7:00 11:00 4.0 Circ & Cond Displace well to fresh water 2 full circs at 124 gpm -ICP 1230 psi, FCP 800 psi. Did a walk through of the rig with Drilling Compliance Specialist and SLR Rep. 11:00 12:00 1.0 Other Pump fresh water through choke manifold, kill line, choke line, blow dwn top drive, mud line, choke line and manifold. 12:00 15:30 3.5 Short Trips POOH on elevators from 12288' to 7858' (upper scraper), up wt 185K, dwn wt 155K 15:30 18:00 2.5 Short Trips RIH from 7858' to 12288'. 18:00 0:00 6.0 Circ & Cond Displace well with clean fresh water, followed by pill train and 6% KCL. 0:00 1:00 1.0 Other Blow dwn all hoses and pumps from tank battery, flush pump 2, blow dwn topdrive, mudlines and all 3 rig pumps. 11) 6117/1:00 6:00 5.0 (drl)Trips POOH LD 4" DP from 12288 to 7884, LD baker scraper. TOTAL 24.00 LITHOLOGY: Hemlock MAX GAS I B.G. GAS ICON GAS 1 ITRIP GAS I I I Accidents None _ I Pollution _ Plan Next 24 Hr Report Attach POOH LD all DP, scrapers and tubing. MUD RECORD CASING RECORD PUMP BPM TYPE 16% KCL DATA I GPM SIZE GRADE WT CONN DEPTH DV ID NUMBER 1 1 2 TIME 2:00 20 OM 377 MAKE Gamdner Denver Gamdner De+ DEPTH 12425 10 -3/4 J -55 40.5 _ 3408 10.5 MODEL 'PZ -8 PZ -8 TEMP 65 7 -5/8 N -80 33.7 Ma 78 6.64 STROKE 8 8 WEIGHT 8.70 7 -5 /8 N -80 26.4 MEIN 4621 6.844 , LINER SZ 5.00 5.00 VISC 28.0 7 -5/8 N -80 29.7 TTRE' 6111 6.75 SPM PV _ TOP OF LINER 4) GAL/STK 1.96 1.96 YP BIT NO. ISUR .PSI GELS BHA# SIZE API WL 9 MFG. SLOW PUMP DATA @ I HTHP DESCRIPTION OD ID FEET TYPE Pump # PSI 1 1 PSI 2 PSI 3 Eff CAKE Bit 3.75 0.25 SERIAL NO. 1 96 SOLIDS asing Scraper /Brust 4.88 1 12.88 NOZZLES 2 96 ADJSOL 2 7/8" Tubing 2.88 2 3550 TFA - SPM for PSI 1/2/3 OIL % XO 4.7 1.5 2.02 DEPTH OUT DRILL STRING CAPACITY WTR % 97.2 asing Scraper /Brust 6.94 1.5 17.33 DEPTH IN BARRELS SD % XO 4.88 2.375 1.71 TOTAL FT. STROKES MBT Drill Pipe _ 4 3.34 4316 HOURS POM XO 5 2.5 1.62 AVG ROP pH 7.6 Casing Scraper 5.38 1.5 6.81 WOB _ Pm XO 4.88 2.375 1.67 ANN VEL DEPTH PF /MF Drill Pipe 4 3.34 4378 ROT. RPM - TORQUE Clmud AV DP CSG PICKUP _ - Clwtr AV DP OP HLE ROTATIONAL Cal 30500 AV DC SLACK OFF LIME TOT CUM HR %LGS 1 GAUGE JAR HOURS _ ES INNER MUD MOTOR HRS I OUTER LOCATION ' RP ' DULL CHAR. CUM HR BHA LIQ MUD I TOTAL LENGTH (FT) 1 3594.46 HYDRAULICS FUEL 14717 GAL ADD (DIESELGAL) TOT WEIGHT (LBS) DEPTH FT CREW BOAT FUEL GAL SOLIDS EQUIPMENT NOZ.AREA •IN' POT. WATER 485 GAL SHAKER #1 Derrick 51 DRK 2 J d Pb PSI TUG FUEL GAL SHAKER #2 Derrick 51 BRDT ___I - IRS HHP BIT 0.8748 HP BARITE 490 SKS DERRICK #1 DRKS HRS H.S.I. HP /IN' FUEL USED GAL MUD CLEAN CENT 0 HRS JET VEL FT /SEC HEAVY H2O 1300 GAL I BOP TESTED PERSONNEL ON BOARD IMP FORCE WEATHER Misc 11/1/2012 HEC 1 %Pb DAILY CUM NEXT TEST DUE RIG 24 BOATS - WIND Calm MPH MUD 8,203.84 296,495.09 11/15/2012 SERVICE 10 MN SEAS 26 TEMP DIESEL FUNC. DUE TOTAL 35 MN PRES COND Clear and Cold TOTAL $296,495 MN FORECAST Clear and Cold 2001 -2010 WellEz Information Management, LLC. All rights reserved ver 5.17.12bg __ • . Hilcorp Energy Company DAILY DRILLING REPO REPORT NO.___ LEASE WELL NO. COUNTY / PARISH WELL STATE - DATE 33 A028399 & A028997 SCU 44 -33 SRF SCU 44 -33 AK 11/5/2012 RIG AFE NO. AFE AMOUNT DAILY COST CDC CCC TOTAL CUM. COST RIG PHONE Arctic Fox 1212791 401850 $197,010 $4,067,589 $4,067,589 907- 776 -6776 ACTIVITY TYPE: DRLG Drilling C &C Circ & Cond DEPTH: MD/TVD PROGRESS / HRS PROPOSED TD , LAST SHOE TEST 1 PPG DAYS SINCE SPUD AFE DAYS FOREMAN 12328 10/17/2012 I 24 32 Rance Pederson ACTIVITY SUMMARY AT: 105:30 HRS 1 SURVEY: MD ANGLE AZIMUTH TV D SECTION N / S E /W DOG LEG CBU just above landing collar, prep to displace to water TIME LOG ELAPSED ACTIVITY COMMENTS FROM TO TIME 11 "I17/ 6:00 7:00 1.0 (drl)Trips Cont POOH from 559' LD HWDP and Baker rotating dog sub. I ` 7:00 9:00 2.0 Other RD hand tongs, 4" elevators and spinner, RU to run 2 7/8" tubing, clean floor. 9:00 19:30 10.5 (drl)Trips MU Swaco scraper assembly, 3.75" bit, 113 jnts 2 7/8" tubing from pipeshed and 4" DP from derrick. Had no problem going into 4 1/2" liner top. 19:30 5:30 10.0 Wash & Ream MU topdrive and wash /reamed from 8775' to 12290' at 4 bpm -1600 psi, 40 rpm, encountered no cement. 117I I-✓ 5:30 6:00 0.5 Circ & Cond CBU 168 gpm -2600 psi, 40 rpm, 2400 ft/lbs torque, rotate and reciprocate string. ENE Ell I _ TOTAL 24.00 LITHOLOGY: Hemlock MAX GAS I B.G. GAS ICON GAS 1 I TRIP GAS 1 J P Accidents INone Pollution Plan Next 24 Hr Report Attach I __ Displace well to 6% KCL, POOH LD DP and Tubing MUD RECORD CASING RECORD PUMP BPM TYPE I EZ -Mud _ DATA GPM SIZE 1- GRADE WT CONN DEPTH DV ID NUMBER 1 2 TIME 1:00 20 ELIDE I 377 MAKE Garndner Denver Garndner Der DEPTH 12425 10 -3/4 J -55 40.5 3408 10.5 MODEL PZ -8 PZ -8 TEMP 65 7 -5/8 N -80 33.7 TT-E' 78 6.64 STROKE 8 8 WEIGHT 11.70 7 -5/8 N -80 26.4 TTRE' 4621 6.844 LINER SZ 5.00 5.00 VISC 50.0 7 -5/8 N -80 29.7 TIRE' 6111 1 6.75 SPM PV 15.0 TOP OF LINER @ I GAL /STK 1.96 ,1.96 YP 16 BIT NO. SUR .PSI 1 GELS 5 BHA# SIZE API WL 5.2 9 MFG. SLOW PUMP DATA @ i HTHP 11 DESCRIPTION OD ID FEET ,TYPE Pump # PSI 1 PSI 2 PSI 3 Eff % CAKE 1 Bit 3.75 l 0.25 SERIAL NO. 1 96 SOLIDS 12.4 teasing Scraper /Brust 4.88 1 12.88 NOZZLES 2 96 ADJSOL 2 7/8" Tubing 2.88 2 3550 TFA SPM for PSI 1/2/3 OIL % 0.1 XO 4.7 , 1.5 2.02 DEPTH OUT DRILL STRING CAPACITY WTR % 85.5 teasing Scraper /Brust 6.94 ' 1.5 17.33 DEPTH IN BARRELS SD % XO 4.88 2.375 1.71 TOTAL FT.) STROKES 106.6 MBT 2.5 Drill Pipe 4 3.34 4316 HOURS POM XO 5 2.5 1.62 AVG ROP pH 8.5 Casing Scraper 5.38 1.5 6.81 WOB - Pm 0.1 XO 4.88 2.375 1.67 ;ANN VEL DEPTH PF /MF 0/4 T Drill Pipe 4 3.34 _4378 jROT. RPM TORQUE _ Clmud AV DP CSG - PICK UP Clwtr . AV DP OP HLE ROTATIONAL - - Cal 26500 AV DC SLACK OFF _ LIME TOT CUM HR %LGS 1.5 GAUGE JAR HOURS ES INNER MUD MOTOR HRS I OUTER LOCATION . RP DULL CHAR. CUM HR BHA LIQ MUD TOTAL LENGTH (FT) 3594.46 HYDRAULICS FUEL 4717 'GAL ADD (DIESELGAL) TOT WEIGHT (LBS) DEPTH FT CREW BOAT FUEL GAL SOLIDS EQUIPMENT NOZ.AREA IN' POT. WATER 485 GAL SHAKER #1 Derrick 511 DRK 2 ' I d Pb PSI TUG FUEL GAL SHAKER #2 Derrick 51 BRDT HRS HHP BIT 3.26721 HP BARITE 490 SKS DERRICK #1 DRKS HRS H.S.I. HP /IN' FUEL USED _ 1053 GAL MUD CLEAN CENT 0 HRS JET VEL FT /SEC _ HEAVY H2O 300 GAL F BOP TESTED PERSONNEL ON BOARD IMP FORCE WEATHER Misc 11/1/2012 HEC 1 %Pb _ DAILY CUM NEXT TEST DUE RIG 24 BOATS WIND 5 MPH MUD 3,353.80 279,819.73 11/15/2012 SERVICE 10 MN SEAS 28 I TEMP DIESEL FUNC. DUE TOTAL 35 MN PRES COND Sunny and Cold _ TOTAL $279,820 MN FORECAST I Sunny and Cold 2001 -2010 WellEz Information Management, LLC. All rights reserved ver 5.17.12bg • Hilcorp Energy Company DAILY DRILLING REPO REPORT NO. LEASE WELL NO. 1 COUNTY / PARISH WELL STATE DATE 32 A028399 & A028997 SCU 44 -33 I SRF SCU 44 -33 AK 11/4/2012 RIG AFE NO. AFE AMOUNT DAILY COST CDC 1 CCC TOTAL CUM. COST RIG PHONE Arctic Fox 1212791 4018500 $182,444 $3,870,578 $3,870,578 907- 776 -6776 ACTIVITY TYPE: DRLG Drilling TOH Tripping out of Hole DEPTH: MD/TVD PROGRESS / HRS PROPOSED TD LAST SHOE TEST PPG DAYS SINCE SPUD AFE DAYS ' FOREMAN 12328 10/17/2012 i 23 31 Rance Pederson ACTIVITY SUMMARY AT: 105:30 [HRS _ SURVEY: MD ANGLE AZIMUTH TVD SECTION N /S E /W DOG LEG LD 4" DP at 1114' 1 L TIME LOG ELAPSED ACTIVITY COMMENTS FROM TO TIME h(2,1(2,-, 6:00 8:00 2.0 (drl)Trips Cont POOH with polish mill /scraper assembly. Hole fill 6.75 bbls over calculated 8:00 11:00 3.0 Rig Service Wait on rotating dog sub delivery. Service rig and topdrive, clean floor, grease crown sheaves, service boiler, CO grabber dies, pull wear bushing. 11:00 18:30 7.5 (drl)Trips _ MU 5.57" rotating dog sub & 5.73" sleeve packoff + XO on HWDP, RIH to 8760'. Up wt 143K, dwn wt 137K with no pump or rotation. 18:30 19:00 0.5 (drl)Misc Ease into ZXP packer top with sleeve packoff, tag dog sub and set down 40K, had noticable indication of shear, cont dwn to 50K dwn wt, PU and rotate at 60 rpm, slack off and set dwn to 90K (50K dwn wt) while rotating, PU / slack off to 75K (60K dwn wt). PU 5 and RU to test casing. 19:00 20:30 1.5 Tstg BOP/WH/ Line up injection pump on kill line, press up on backside and test 4" x 7 5/8" for 15 minutes. Good test. Bleed off. 20:30 21:30 1.0 Circ & Cond Displace well to 11.5 mud. Had max gas of 2698 units at bottoms up. 21:30 22:30 1.0 Tstg BOP /WH/ Line up ijection pump and test 7 5/8 ", liner lap and 4 1/2" casing at 2100 psi for 30 minutes on chart. Good solid test. Bled off and RD injection pump. 22:30 23:30 1.0 Other Check for flow, pump 18 bbl dry job 1.5 lbs over, blow dwn topdrive & mud line. 23:30 2:30 3.0 (drl)Trips POOH rack back stands to 3444'. _ it l tv 2:30 6:00 ' 3.5 (drl)Trips Lay down 4" DP and 18 jnts 4" HWDP. TOTAL * 24.00 ' LITHOLOGY: Hemlock MAX GAS 12698 B.G. GAS j ICON GAS 1 1TRIP GAS 1 1 1 Accidents None Pollution Plan Next 24 Hr Report Attach MU 2 7/8" Cleanout Assembly and RIH to cleanout 4 1/2" liner MUD RECORD CASING RECORD PUMP ' BPM TYPE 1EZ-Mud _ DATA GPM SIZE GRADE WT CONN DEPTH DV ID [NUMBER 1 2 TIME 1:00 20 NELDE 377 MAKE Gamdner Denver Garndner Der DEPTH 12425 10 -3/4 J -55 40.5 3408 10.5 MODEL PZ -8 PZ -8 TEMP 65 7 -5/8 N -80 33.7 JTTRE' 78 6.64 STROKE 8 8 WEIGHT 11.70 7 -5/8 N -80 26.4 JTTRE' 4621 6.844 LINER SZ 5,00 5.0 VISC 50.0 7 -5/8 N -80 29.7 JTTRE 6111 6.75 ISPM PV 15.0 TOP OF LINER @ _ C 1GAUSTK 1.96 1.96 YP 16 [BIT NO. 1SUR .PSI 2163 El GELS 5 BHA# SIZE ' API WL 5.2 7 MFG. SLOW PUMP DATA @ HTHP 11 DESCRIPTION OD ID FEET TYPE Pump # _ PSI 1 PSI 2 PSI 3 Eff CAKE 1 Rotating Dog Sub 5.73 2 12.65 SERIAL NO. 1 96 SOLIDS 12.4 XO 4.75 2.25 1.71 NOZZLES 2 96 ADJSOL HWDP X 18 4 2.562 544.9 TFA SPM for PSI 1/2/3 OIL % 0.1 Drill Pipe 4 2.562 8206 DEPTH OUT DRILL STRING CAPACITY WTR % 85.5 DEPTH IN BARRELS SD % TOTAL FT. STROKES MBT 2.5 HOURS POM AVG ROP pH 8.5 WOB Pm 0.1 ANN VEL DEPTH PF /MF 0/4 _ ROT. RPM TORQUE _ Clmud AV DP CSG PICK UP Clwtr AV DP OP HLE ROTATIONAL Cal 26500 AV DC SLACK OFF LIME TOT CUM HR %LGS 1.5 GAUGE JAR HOURS ES INNER MUD MOTOR HRS OUTER LOCATION RP DULL CHAR. CUM HR BHA 1 LIQ MUD 1 TOTAL LENGTH (FT) 559.27 ! HYDRAULICS FUEL X2169 GAL ADD (DIESELGAL) TOT WEIGHT (LBS) 127000 DEPTH FT CREW BOAT FUEL GAL SOLIDS EQUIPMENT NOZ.AREA 1.7455 IN" SPOT. WATER 485 GAL SHAKER #1 Derrick 51 DRK 2 ME d Pb PSI TUG FUEL GAL SHAKER #2 Derrick 51 BRDT 1 HRS , HHP BIT 31.8014 HP BARITE 490 SKS DERRICK #1 DRKS , HRS I H.S.I. _ HP /IN' FUEL USED 2365 GAL MUD CLEAN _ CENT 0 HRS JETVEL I FT /SEC HEAVY H20 300 [GAL BOP TESTED PERSONNEL ON BOARD IMP FORCE _ WEATHER Misc 11/1/2012 HEC 1 %Pb DAILY CUM NEXT TEST DUE RIG 24 BOATS WIND 5 I MPH MUD 3,353.80 279,819.73 11/15/2012 SERVICE 12 MN SEAS 29 (TEMP DIESEL FUNC. DUE TOTAL 37 MN PRES COND Overcast TOTAL $279,820 MN i FORECAST Overcast 2001 -2010 WellEz Information Management, LLC. All rights reserved ver 5.17.12bg AO Hilcorp Energy Company n, DAILY DRILLING REPO" REPORT NO. LEASE WELL NO. COUNTY / PARISH WELL STATE DATE 31 A028399 & A028997 KU 44 -33 SRF SCU 44 -33 AK 11/3/2012 RIG AFE NO. AFE AMOUNT DAILY COST CDC CCC TOTAL CUM. COST RIG PHONE Arctic Fox 1212791 4018500 $183,871 $3,688,134 $3,688,134 907 - 776 -6776 ACTIVITY TYPE: DRLG Drilling TOH Tripping out of Hole DEPTH: MD/TVD PROGRESS / HRS PROPOSED TD LAST SHOE TEST PPG DAYS SINCE SPUD AFE DAYS FOREMAN T 12328 10/17/2012 22 30 Rance Pederson ACTIVITY SUMMARY AT: 105:30 - POOH HRS 1 SURVEY: MD ANGLE AZIMUTH TVD SECTION N /S E / W DOG LEG POOH to lay down polish mill assembly. TIME LOG ELAPSED FROM TO TIME ACTIVITY COMMENTS iilzj 1 __ 6:00 12:00 6.0 Tstg BOP/WH/ Cont testing BOPE at 250/5000 f/10 &10, annular at 250/2500 psi f/10 &10 min. _12:00 Had 5 fail /pass tests due to psi drop on chart recorder. Changed plug seals, isolation needle valve on test manifold and leaking fitting on chart recorder. All fail/pass tests were re -done successfully. 12:00 13:00 1.0 Other RD test equip, close annulus valve, pull test plug, install wear ring, blew dwn. 13:00 14:00 1.0 l (drl)Misc MU Baker "TBR" dress and polish mill assembly and 7 5/8" scraper and XO's. 14:00 20:00 6.0 '(drI)Trips RIH on 4" HWDP and DP to 8752' (13' above liner top). _ 20:00 21:00 1.0 Circ & Cond CBU one time to get good 12.5 mud all the way around. Max gas 3442 units. 197 spm -8.5 bpm -2200 psi, rotating and reciprocating 40 rpm -2600 ft/lbs torque. _ 21:00 22:00 1.0 Wash & Ream Reduce pump rate and rpm to 3 bpm and 10 rpm, ease down and locate liner top. PU increase rpm to 75, ease dwn and dress liner top f/10 min, 3000 ft/lbs torque on bott, 2200 ft/lbs off bott, 10K dwn wt on upper mill, 460 psi on bolt. 22:00 23:30 1.5 Circ & Cond CBU to clear any cuttings /cement from well bore and good 12.5 mud all around. 23:30 0:30 1.0 Other Check for flow, pump 18 bbl dry job and blow dwn topdrive /mud line. IA kb 0:30 6:00 5.5 (drl)Trips POOH from 8765' to 2000'. ME TOTAL 24.00 LITHOLOGY: Hemlock MAX GAS 3442 B.G. GAS CON GAS [TRIP GAS 1 I 11_. Accidents None Pollution Plan Next 24 Hr _- Report Attach RIH with Non Rotating Dog Sub and RTTS to test liner lap and casing MUD RECORD CASING RECORD -PUMP 4.66 BPM TYPE 1EZ -Mud DATA 196 GPM SIZE GRADE I WT TCONNI DEPTH DV ID - 1 NUMBER 11 2 TIME 3:00 20 ELDE( 377 MAKE r Gamdner Denver Garndner Der DEPTH 12425 10 -3/4 J -55 40.5 3408 10.5 MODEL PZ -8 PZ -8 TEMP 65 7 -5/8 N -80 33.7 JTTRE; 78 6.64 STROKE 8 8 WEIGHT 12.55 7 -5/8 N -80 26.4 JTTRE: 4621 6.844 1 LINER SZ 5.00 5.00 VISC 54.0 7 -5/8 N -80 29.7 JTTRE 6111 6.75 SPM 100 PV 15.0 TOP OF LINER @ 1 - 1 GAL/STK 1.96 11.96 YP 117 BIT NO. 4 '3 TSUR .PSI 12163 _ GELS 5 BHA# SIZE 6.125 6.125 API WL 5.6 6 MFG. HCC HCC SLOW PUMP DATA @ 18765 HTHP 11.2 DESCRIPTION OD ID FEET TYPE iMX -R18DX QD505FHX Pump# PSI1 PSI 2 PSI3 Eff% CAKE 1 TBR Polishing Mill 5.66 2.75 1.44 SERIAL NO. 5185181 7028065 1 325 550 96 SOLIDS 15.7 Extension _ 4.75 2 0.84 NOZZLES 3 x 18 5X12 2 96 ADJSOL Pup Joint 4.75 1.5 6.54 TFA 0.746 0.552 SPM for PSI 1/2/3 1 65 87 1 _ OIL % 0.1 fBR Top Dressing Mi 5.85 2.75 2.41 DEPTH OUT 12425 12425 DRILL STRING CAPACITY WTR % 82.25 Double Pin Sub 4.75 1.562 1.07 DEPTH IN 12425 9832 BARRELS SD % Casing Scraper 5.5 1.25 3.36 TOTAL FT. 2593 STROKES 92.4 MBT 2.5 Bit Sub 4.75 1.562 2.38 HOURS 74.4 POM XO 4.75 2.25 1.71 AVG ROP 34.8 pH 8.5 HWDP X 18 4 2.562 544.9 WOB Pm 0.1 _ Drill Pipe 4 2.562 8199 ANN VEL 335 DEPTH PF /MF 0/4 ROT. RPM 260 320 TORQUE Clmud AV DP CSG PICK UP 143000 Clwtr AV DP OP HLE ROTATIONAL 143000 Cal 26500 AV DC 482 SLACK OFF 143000 LIME TOT CUM HR 74.4 %LGS 1.8 GAUGE I JAR HOURS ES 1 INNER 0 MUD MOTOR HRS OUTER 1 LOCATION A RP ,Run Liner TD DULL CHAR.' ER CUM HR BHA I LIQ MUD 1 TOTAL LENGTH (FT) 564.66 HYDRAULICS FUEL 4234 GAL ADD (DIESELGAL) TOT WEIGHT (LBS) 126000 DEPTH FT CREW BOAT FUEL GAL SOLIDS EQUIPMENT NOZ.AREA .7455 IN' POT. WATER _ 185 GAL SHAKER #1 Derrick 51 DRK 2 1 d Pb 79.7625 PSI TUG FUEL GAL SHAKER #2 Derrick 51 BRDT HRS HHP BIT 131.8014 1 HP BARITE 580 SKS DERRICK #1 DRKS HRS H.S.I. 1.07985 HP /IN' FUEL USED GAL MU D CLEAN _ CENT 0 HRS JET VEL 84.0062 FT /SEC HEAVY H2O _ 300 GAL I __ BOP TESTED PERSONNEL ON BOARD IIMP FORCE _. WEATHER Misc 11/1/2012 HEC 1 _ %Pb 1 _ DAILY CUM NEXT TEST DUE RIG 24 - BOATS WIND 10 MPH MUD 14,630.03 276,458.93 11/15/2012 SERVICE 13 MN SEAS 26 TEMP DIESEL FUNC. DUE TOTAL 38 MN PRES COND Overcast TOTAL _ $276,459 MN FORECAST Overcast 2001 -2010 WellEz Information Management, LLC. All rights reserved ver 5.17.12bg _ Hilcorp Energy Com DAILY DRILLING REPO REPORT NO. LEASE WELL NO. COUNTY / PARISH WELL STATE DATE 30 A028399 & A028997 SCU 44 -33 SRF SCU 44 -33 AK 11/2/2012 RIG AFE NO. AFE AMOUNT DAILY COST CDC CCC TOTAL CUM. COST RIG PHONE Arctic Fox 1212791 4018500 l $58,427 $3,504,263 I $3,504,263 907- 776 -6776 ACTIVITY TYPE: DRLG ' Drilling TestBOP Testing BOP /WH DEPTH: MD/TVD PROGRESS / HRS PROPOSED TD LAST SHOE TEST PPG DA YS SINCE SPUD AFE DAYS FOREMAN 12328 10/17/2012 21 29 Leslie /Pederson ACTIVITY SUMMARY AT: 105:30 Test gas HRS I SURVEY: MD ANGLE AZIMUTH TVD SECTION N /S E /W DOG LEG Testing last of choke valves and 2 7/8" jnt in annular -. TIME LOG ELAPSED ACTIVITY COMMENTS FROM TO TIME iLii b 6:00 8:00 2,0 Well Control Cont monitor DP and annular pressure with well shut in, transfer 12.5 ppg mud into pits from tiger tank. SIDP 20 to 427, SICP 0 to 408. Transferred 11.5 mud to rockwasher tanks and tiger tank to make room for returns in rig tanks. 8:00 10:00 2.0 Circ & Cond Circ 12.5 mud around through choke and degasser at 3.5 bpm, held 200 psi back pressure, ICP 600 psi, FCP 570 psi with full open choke, max gas 1191 units. 10:00 10:30 0.5 Well Control Stop pump, open upper rams, monitor well 30 min, static. Blow dwn surf lines. 10:30 11:00 0.5 Other Pump 18 bbl slug 1.5 ppg over, blow dwn topdrive and mud line. 11:00 14:30 3.5 (dri)Trips POOH from 8730' to 5300', hole fill good. 14:30 15:00 0.5 Well Control Monitor well f /30 min while filling trip tank. Well static. 15:00 19:00 4.0 (drl)Trips Cont POOH from 5300' to surface, LD Baker HRD -E liner running tool. No damage or other issues found with running tool upon inspection. 19:00 20:30 1.5 _Other PU and break pup jnts off Baker cement head, LD same and remove from pipe shed. 20:30 22:30 2.0 Tstg BOP/WH/ RU to test BOPE, MU test jnt, plug, TIW and dart valves, PJSM. q(tit z,-- 22:30 6:00 7.5 Test BOPE at 250/5000 psi, annular at 250/2500, all tests at 10/10 min, test gas alarms, monitoring well in cellar through annulus valve (no flow). TOTAL 24.00 LITHOLOGY: Hemlock MAX GAS 1 B.G. GAS ICON GAS 1 (TRIP GAS - 1 _ Accidents None Pollution _ Plan Next 24 Hr Report Attach RIH with polish mill and scraper MUD RECORD CASING RECORD PUMP BPM TYPE 1EZ-Mud DATA L GPM SIZE GRADE WT CONN DEPTH DV ID NUMBER 11 2 TIME 3:00 20 VELD EI 377 MAKE Gamdner Denver Garndner Der DEPTH i 12425 10 -3/4 J -55 40.5 3408 10,5 MODEL PZ -8 PZ -8 TEMP 60 7 -5/8 N -80 33.7 JTTRE' 78 6.64: STROKE 8 _ 8 WEIGHT 12.55 7 -5/8 N -80 26.4 JTTRE' 4621 I 6.844 LINER SZ ;500 •5.00 VISC 52.0 7 -5/8 N -80 29.7 JTTRE' 6111 6.75 FSPM PV 15.0 TOP OF LINER QJ I GAL /STK 1.96 ;1.96 - YP PO BIT NO. 4 3 - 1 - SIR .PSI [810 GELS - 6 BHA# SIZE 6.125 6.125 API WL 5.2 5 MFG. i HCC HCC SLOW PUMP DATA @ T HTHP 11.2 DESCRIPTION I OD ID 1 FEET TYPE MX -R18DX QD505FHX Pump # _ PSI 1 _ PSI 2 PSI 3 1 Eff % CAKE 1 BIT 6.125 1.5 I 0.6 SERIAL NO. 5185181 7028065 1 I 96_ SOLIDS 15.8 MOTOR 4.75 3.421 22.04 NOZZLES 3 x 18 5X12 2 __ 96 ADJSOL N M STAB - STRING 6 ' 2.25 5.65 TFA 0.746 0.552 SPM for PSI 1/2/3 OIL % 0.1 DRILL PIPE 4.75 3.5 9.17 DEPTH OUT 12425 12425 DRILL STRING CAPACITY WTR % 82.25 NM SUB - STOP 5 2,25 1.67 DEPTH IN 12425 9832 BARRELS - SD % ON TRAK - MWD 4 2.25 23.37 TOTAL FT. 2593 STROKES 1 MBT 2.5 MWD STAB - MOD 5 1.15 2.87 HOURS 74.4 POM BCPM 5 1.875 10.76 AVG ROP 34.8 pH 8.9 MWD STOP SUB 5 1.375 2.98 WOB i Pm 0.25 Sonic Tool 4.75 2.5 32.88 ANN VEL 335 DEPTH PF /MF 0/3 NM SUB FILTER 4.75 2.75 5.6 ROT. RPM 260 320 TORQUE Clmud DRILL PIPE 3.687 2,312 30.29 AV DP CSG PICK UP 190 Clwtr DRILL PIPE 3.687 2.312 1 30.87 AV DP OP HLE ROTATIONAL 160 Cal 26000 XO 4.75 2.25 2.39 AV DC 482 SLACK OFF 155 LIME HW DP X 6 4 2.562 181.7 TOT CUM HR 74.4 %LGS 1.8 JARS 5.063 2 31.89 GAUGE I JAR HOURS 113 ES INNER 0 MUD MOTOR HRS 1 OUTER 1 LOCATION , A RP Run Liner TD DULL CHAR. ER CUM HR BHA LIQ MUD 1 TOTAL LENGTH (FT) 757.94 HYDRAULICS FUEL 14234 GAL ADD (DIESELGAL) TOT WEIGHT (LBS) 22.2 DEPTH FT CREW BOAT FUEL GAL j SOLIDS EQUIPMENT NOZ.AREA ,.7455 IN IPOT. WATER 185 GAL SHAKER #1 Derrick 51 DRK 2 . d Pb PSI _ TUG FUEL GAL SHAKER #2 Derrick 51 BRDT HRS HHP BIT HP BARITE ;1467 SKS DERRICK #1 DRKS HRSH.S.I. HP /IN' FUEL USED 1209 GAL M_U_ D CLEAN CENT 0 HRS , J ET V EL J FT /SEC 1HEAVY H2O 300 GAL l BOP TESTED PERSONNEL BOA RD IMP FORCE WEATHER Misc 11/1/2012 HEC 1 _ %Pb I __ DAILY CUM NEXT TEST DUE RIG 24 _ BOATS WIND 1 20 MPH MUD 7,136.20 261,828.90 11/15/2012 SERVICE X12 MN SEAS 20 TEMP DIESEL FUNC. DUE TOTAL 37 MN PRES COND Clear, Cold, Windy TOTAL $261,829 MN FORECAST Clear, Cold, Windy 2001 -2010 WellEz Information Management, LLC. All rights reserved ver 5.17.12bg 0 Hilcorp Energy Company , I An DAILY DRILLING REPOOP REPORT NO. LEASE WELL NO. COUNTY / PARISH WELL STATE DATE 29 A028399 & A028997 SCU 44 -33 SRF SCU 44 -33 AK 11/1/2012 RIG AFE NO. AFE AMOUNT DAILY COST CDC CCC 1 TOTAL CUM. COST RIG PHONE Arctic Fox 1212791 4018500 $241,131 $3,445,836 $3,445,836 907 - 776 -6776 ACTIVITY TYPE: DRLG Drilling SI /Eval Shut in for Eval DEPTH: MD/TVD PROGRESS / HRS PROPOSED TD LAST SHOE TEST PPG DAYS SINCE SPUD AFE DAYS FOREMAN 12328 10/17/2012 20 j 28 Leslie /Pederson ACTIVITY SUMMARY AT: 105:30 Monitor frI HRS I _ SURVEY: MD ANGLE AZIMUTH TVD SECTION N /S E /W DOG LEG Monitor shut in pressures at 8730' _ -- TIME LOG ELAPSED ACTIVITY COMMENTS FROM TO TIME 101311 ti) 6:00 8:30 2.5 UnPlanned Circ. High Vis Nut Plug Marker Pill In /Out to verify flow path of circ system . Pumped 33 bbl pill at 124 gpm -380 psi, chased with 11.5 mud at 210 gpm -910 psi Rotated string at 10 rpm -3200 ft/lbs torque, 9356 stks had nutplug pill at surf. _ 8:30 10:30 2.0 Wash & Ream RIH 20 stands DP washing liner to bottom at 3 bpm -500 psi, 150K dwn wt. 10:30 12:30 2.0 Circ & Cond CBU at 4 bpm -740 psi, 30 rpm -5500 ft/lbs torque, max gas 3487 units. 12:30 14:00 1.5 Wash & Ream Held PJSM with Baker reps and rig team on MU cement head and pup jnts. MU head, MU topdrive, wash down at 3 bpm -470 psi, 10 rpm -4000 ft/lbs torque, tag bottom at 12,425', PU and place shoe 2' off bottom at 12,423', up wt 175K. 14:00 14:30 0.5 Other Held PJSM with Schlumberger, rig team, Baker reps, AIMM drivers on cementing. 14:30 17:00 2.5 Cementing & VA SLB pumped 5 bbls water to fill lines, PT hardlines at 1000 and 5000 psi, Rig pumped 24 bbls 13ppg MudPush II at 3.5 bpm -700 psi, SLB began batching 12 _ bbls into MudPush. SLB pumped 100 bbls (416sx) 15.6 ppg cement at 3.9 bpm with full returns throughout job, rotated string at 23 rpm, 555 units max gas. Shut in DP, washed up cement lines, dropped dart, lined up and SLB displaced with 11.3 mud from pits at 5 bpm -330 psi initially, saw dart latch wiper plug at 89.6 bbls into displacement, increased pump rate to 5 bpm -1500 psi and stopped _ rotation of string, cut rate to 2.5 bpm -830 psi, bumped plug /landing collar at _ 144.2 bbis displaced, fcp 900 psi, held 1420 psi (500 over fcp) f/1 minute, increased psi to 3000 and held f/1 minute, bled back 1 bbl, floats holding, max gas 1891 units at shut dwn. CIP 16:45 hrs. 17:00 17:30 0.5 (drl)Misc Set HRD ZXP liner top packer as per Baker, top of liner at 8765.97', RD SLB _ 17:30 20:00 2.5 Circ & Cond Press up DP to 500 psi, ease up out of packer and start pumping as psi dropped. TOTAL 14.00 LITHOLOGY: Hemlock MAX GAS I B.G. GAS - C - ON GAS' TRIP GAS I 1 _ _ 1 A ccidents None Pollution I Plan Next 24 Hr _ Report Attach I Monitor well for pressure and troubleshoot flow issue - MUD RECORD CASING RECORD _ PUMP BPM TYPE EZ -Mud _ DATA GPM SIZE GRADE WT CONN DEPTH DV ID NUMBER 1 2 TIME 1:00 20 NELDE[ 377 MAKE Garndner Denver Garndner Der DEPTH 12425 10 -3/4 J -55 40.5 3408 10.5 MODEL PZ -8 PZ -8 TEMP 70 7 -5/8 N -80 33.7 JTTRE1 78 6,64 STROKE 8 8 WEIGHT 11.50 7 -5/8 N -80 26.4 JTTRE 4621 6.844 LINER SZ 5.00 5.00 VISC 50.0 7 -5/8 N -80 29.7 JTTRE 6111 6.75 SPM PV 13.0 TOP OF LINER @ I GAL /STK 1.96 1.96 YP 14 BIT NO. 4 3 - I SUR .PSI x810 GELS 4 BHA# SIZE 6.125 6.125 API WL 4.8 5 MFG. HCC HCC SLOW PUMP DATA @ HTHP 10.8 DESCRIPTION OD ID FEET 'TYPE MX-R18DX QD505FHX Pump # PSI 1 PSI 2 PSI 3 Eff % CAKE 1 BIT 6.125 1.5 0.6 SERIAL NO. 5185181 7028065 1 , 96 SOLIDS 11.9 MOTOR 4.75 3.421 22.04 NOZZLES 3 x 18 5X12 2 96 ADJSOL NM STAB - STRING 6 2.25 5.65 TFA 0.746 0.552 SPM for PSI 1/2/3 OIL % 0.1 DRILL PIPE 4.75 3.5 9.17 DEPTH OUTT 2425 12425 DRILL STRING CAPACITY WTR % 86 NM SUB - STOP 5 2.25 1.67 DEPTH IN 12425 9832 BARRELS SD % ON TRAK - MWD 4 2.25 23.37 TOTAL FT. 2593 STROKES MBT 2.5 MWD STAB - MOD 5 1.15 2.87 HOURS 74.4 POM BCPM 5 1.875 10.76 AVG ROP 34.8 pH 9 _ MWD STOP SUB 5 1.375 2.98 WOB Pm 0.35 Sonic Toot 4.75 2.5 32.88 ANN VEL ■ 335 DEPTH PF /MF 1/4 NM SUB FILTER 4.75 2.75 5.6 ROT. RPM 2 320 TORQUE _ Clmud DRILL PIPE 3.687 2.312 30.29 AV DP CSG _ PICK UP 190 Clwtr DRILL PIPE 3.687 2.312 30.87 AVDPOPHLE ROTATIONAL 160 Cal 26000 XO 4.75 2.25 2.39 AV DC 482 SLACK OFF 1 LIME HWDP X 6 4 2.562 181.7 TOT CUM HR 74.4 %LGS 2 JARS 5.063 2 31.89 GAUGE 1 JAR HOURS 113 ES INNER 0 MUD MOTOR FIRS OUTER 1 LOCATION A 'RP Run Liner TD DULL CHAR. ER CUM HR BHA 1 LIQ MUD 1 TOTAL LENGTH (FT) 757.94 HYDRAULICS FUEL 5289 GAL A_ DD (DIESELGAL) TOT WEIGHT (LBS) 22.2 DEPTH FT CREW BOAT FUEL GAL SOLIDS EQUIPMENT NOZ.AREA .7455 IN POT. WATER 360 GAL SHAKER #1 Derrick 51 DRK 2,1 II d Pb PSI TUG FUEL GAL SHAKER #2 Derrick 5 BRDT I HRS HHP BIT HP !BARITE .1057 SKS DERRICK #1 DRKS HRS H.S.I. HP /IN' FUEL USED GAL 1MUD CLEAN i CENT 0 HRS JET VEL jFT /SEC HEAVY H2O _ 300 GAL I BOP TESTED PERSONNEL ON BOARD IMP FORCE WEATHER Misc 10/18/2012 HEC 1 %Pb DAILY CUM NEXT TEST DUE RIG 24 BOATS WIND 20 MPH MUD 4,401.61 254,692.70 11/1/2012 SERVICE 20 MN SEAS 28 TEMP DIESEL _ FUNC. DUE TOTAL _ 45 MN PRES COND Cold /Windy TOTAL $254,693 MN FORECAST Cold/Windy 2001 -2010 WeIIEZ Information Management, LLC. All rights reserved ver 5.17.12bg Hilcorp Energy Company , DAILY DRILLING REPO ` REPORT NO. LEASE WELL NO. COUNTY / PARISH WELL STATE DATE 29 A028399 & A028997 SCU 44 -33 SRF SCU 44 -33 AK 11/1/2012 RIG AFE NO. AFE AMOUNT DAILY COST CDC CCC TOTAL CUM. COST RIG PHONE Arctic Fox 1212791 4018500 ] $241,131 $3,445,836 $3,445,836 907-776-6776 ACTIVITY TYPE: DRAG Drilling SI /Eval Shut in for Eval DEPTH: MD/TVD PROGRESS / HRS PROPOSED TD LAST SHOE TEST PPG DAYS SINCE SPUD AFE DAYS FOREMAN 12328 10/17/2012 20 28 Leslie /Pederson Continued from Page 1 TIME LOG ELAPSED ACTIVITY COMMENTS FROM TO TIME Increase rate to 7 bpm -1400 psi and CBU 1 x, drop 4" wiper ball and CBU 1 x, approx 10 bbls cement to surf on first CBU. 20:00 22:30 2.5 (drl)Trips POOH 14 stands racking back in derrick from 8 to 783 22:30 23:30 1,0 Rig Service Slip and cut 110' drill line. - 23:30 2:00 2.5 (drl)Trips Pump dry job, cont POOH from 7830' to 6585'. Hole fill incorrect. 2:00 3:30 1.5 C irc & Cond Performed flow check, well is flowing at 4.5 bph, CBU at 4 bpm -630 psi, 394 units gas at bott up. Notified Drilling Manager, prep to load 12.5 mud in pits - 3:30 5:30 2.0 (drl)Trips TIH fom 6585' to 8730' (30' above liner top), calculated displacement 11.35 bbls actual displacement was 19.5 bbls (8 bbls over). 41111 2 5:30 6:00 0.5 Well Control MU topdrive, close upper rams and monitor for any pressure on DP and annulus. MI EME _- Mil MI 111 I. 2001 -2010 WellEz Information Management, LLC. All rights reserved ver 5.17.12bg n til,_ Hilcorp Energy Company DAILY DRILLING REPOI1P REPORT NO. LEASE 1 WELL NO. COUNTY / PARISH WELL STATE DATE 28 A028399 & A028997 SCU 44 -33 SRF SCU 44 -33 AK 10/31/2012 RIG AFE NO. AFE AMOUNT DAILY COST CDC 1- CCC TOTAL CUM. COST RIG PHONE Arctic Fox 1212791 4018500 $70,291 $3,199,815 1 $3,199,815 907 - 776 -6 ACTIVITY TYPE: DRLG Drilling CsgProb Csg Problems DEPTH: MD/TVD PROGRESS / HRS PROPOSED TD LAST SHOE TEST PPG DAYS SINCE SPUD AFE DAYS FOREMAN 12425 1 10747 12328 10/17/2012 14.0 19 27 Leslie /Pederson ACTIVITY SUMMARY AT: 1 05:30 HRS SURVEY: MD AN_ GLE AZIMUTH TVD SECTION N /S E / W DOG LEG Pumping High Vis, Nut Plug marker Pill TIME LOG ELAPSED ACTIVITY COMMENTS FROM TO TIME 1 4I3o , ty 6:00 6:30 0.5 Wash & Ream T1H with 4 1/2" Production Liner 1/10070. Wash & Ream thru tight spot to 10227 6:30 8:00 1.5 Circ & Cond .CBU @ 10227. 20 rpm, 2500 tq, 6 bpm, 1100 psi. 3880 units @ B/U 8:00 9:00 1.0 (drl)Trips Continue to RIH f/102271/11230. Ream tight spots as necessary to pass. _ 9:00 10:30 1.5 Circ & Cond CBU @ 11230 to clear ann prior to entering Hemlock. 30 RPM, 3.5 tq, 5 bpm, 1090 10:30 14:00 3.5 (drl)Tnps Cont. to RIH. Wash & Ream when necessary. Tight working through top of Hemlock Ream tight spots from 11460 to 11560. Slide to 12088. Wash & Ream to 12360. 14:00 15:00 1.0 Circ & Cond Circ. to clear gas from Annulus prior to washing down final stand. (2085 units) 15:00 16:30 1.5 (drl)Trips Wash & Ream final stand to 12413. Make up Pup jts and TD Plug Dropping Head, 16:30 18:00 1.5 (drl)Trips Circ & cond f /Cmt job. UP 163, DN 152, ROT 160, 5 bpm, 835 psi, 30 RPM, 4500 tq _ Washed to 12423', psi dropped from 835 to 530 psi at bottom, tagged bottom and set 20K on shoe with no psi change. PSI down to 400. Notified Drilling Engineer of possible washout, dropped carbide pill, had indication of gas 26.8 bbls away. Decision made to backream OOH looking for hole 18:00 23:30 5.5 UnPlanned Backream OOH at 65 spm (470 psi) 25 rpm from 12,423' to 11,158' (20 stnds) 23:30 2:00 2.5 UnPlanned Dropped carbide pill with no indication of gas near surface, complete full circ at 65 spm -470 psi, max gas 1745 units. 2:00 3:30 1.5 UnPlanned Break off topdrive, close upper rams, fine up kill line, press up to 200 psi on _ backside, looking for communication in DP, had no flow, press up to 400 psi, no flow in DP, bled off annulus, blew dwn choke, MU topdrive, circ @ 3 bpm, 390 psi _ 3:30 4:00 0.5 UnPlanned Notified Drilling Manager of results, Agreement made to pump marker pill _ i0(3 I 4:00 6:00 2.0 UnPlanned Finish circ B/U to clear 2820 units. Mix high vis pill w /nut plug marker TOTAL 24.00 LITHOLOGY: Hemlock MAX GAS 3890 B.G. GAS ICON GAS 1 ITRIP GAS I Accidents I None Pollution _ No Pollution Plan Next 24 Hr Report Attach - ■ Evaluate results of marker Pill. Finish Liner job. MUD RECORD C ASING RECORD 1 PUMP 4.43 BPM TYPE IEZ -Mud _ DATA 186 GPM SIZE GRADE WT 1 CONN DEPTH DV ID I NUMBER 11 -1 2 TIME 1:00 20 V_ELDE1 377 MAKE Garndner Denver GarndnerDer DEPTH 12425 10 -3/4 J -55 40.5 10.5 'MODEL PZ -8 PZ -8 TEMP 74 ' 7 -5/8 N -80 33.7 JTTRE' 78 6.64 STROKE 8 18 WEIGHT 11.50 7 -5/8 N -80 26.4 JTTRE' 4621 _6.844 I LINER SZ 5.00 5.00 VISC 1 50.0 7 -5/8 N -80 29.7 L1TTRE' 6111 6.75 SPM 95 PV 13.0 TOP O F LINE R @ 1 _ GAL/STK 1.96 1.96 YP 14 1 BIT NO. 14 3 1SUR .PSI 810 --- GELS 4 BHA# SIZE 16.125 6.125 API WL 1 4.8 5 MFG. I HCC HCC SLOW PUMP DATA @ 111150 HTHP 11 DESCRIPTION OD ID 1 FEET TYPE MX- R18DX QD505FHX Pump # PSI 1 PSI 2 PSI 3 Eff % CAKE 1 BIT 6.125 1.5 0.6 SERIAL NO. 5185181 7028065 1 390 96 SOLIDS 11.9 i MOTOR 4.75 3.421 22.04 NOZZLES 3 x 18 5X12 2 I 96 ADJSOL NM STAB - STRING 6 2.25 5.65 'TFA 0.746 0.552 SPM for PSI 1/2/3 65 1 OIL % 0.1 DRILL PIPE 4.75 3.5 9.17 DEPTH OU1 1 12425 DRILL S_ TRING CAPACITY - WTR % 186 NM SUB - STOP 5 2.25 1.67 DEPTH IN 12425 9832 BARRELS SD % ON TRAK - MWD 4 2.25 23.37 TOTAL FT. 2593 'STROKES MBT 3.5 _ , MWD STAB - MOD 5 1.15 2.87 HOURS 74.4 POM BCPM 5 1.875 10.76 AVG ROP I 34.8 pH 9.3 MWD STOP SUB 5 1.375 2.98 WOB Pm 0.45 Sonic Tool ( 4.75 2.5 3 ANN VEL 335 DEPTH PF /MF 0/3 NM SUB FILTER 4.75 2.75 5.6 ROT. RPM 260 320 'TORQUE Clmud DRILL PIPE 3.687 2.312 30.29 AV DP CSG PICK UP 190 Clwtr DRILL PIPE 3.687 2.312 30.87 ' AV DP OP HLE : ROTATIONAL 160 Cal 126500 XO 4.75 2.25 2.39 AV DC 482 _ SLACK OFF 155 LIME HWDP X 6 4 2.562 181.7 TOT CUM HR 74.4 %LGS 2 JARS 5.063 2 31.89 GAUGE 1 JAR HOURS 113 ES INNER 0 MUD MOTOR_ HRS OUTER 1 LOCATION A RP Run Liner TD DULL CHAR. ER SCUM HR BHA LIQ MUD 1 TOTAL LENGTH (FT) 757.94 HYDRAULICS FUEL 15289 GAL ADD (DIESELGAL) TOT WEIGHT (LBS) 22.2 DEPTH 12425 FT CREW BOAT FUEL GAL SOLIDS EQUIPMENT NOZ.AREA .7455 IN POT. WATER 360 GAL SHAKER #1 Derrick 51 DRK 2 d Pb 65.963 PSI TUG FUEL GAL SHAKER #2 Derrick 51 BRDT HRS HHP BIT HP BARITE 1277 SKS DERRICK #1 DRKS HRS H.S.I. IHP /IN' FUEL USED 11004 GAL MUD CLEAN (CENT 1 0 HRS JET VEL 79.8059 FT /SEC HEAVY H2O 1300 GAL BOP TESTED PERSONNEL ON BOARD IMP FORCE 1 Misc 10/18/2012 HEC _ 1 %Pb I WEATHER DAILY CUM NEXT TEST DUE RIG 24 BOATS WIND ' 5 mph I MPH MUD 4,890.40 250,291.09 _ 11/1/2012 SERVICE 20 MN SEAS 25 (TEMP DIESEL _ FUNC. DUE TOTAL i45 I PRESCOND Cloudy TOTAL $250,291 j iMN FORECAST LSame 2001 -2010 WellEz Information Management, LLC. All rights reserved ver 5.17.12bg 1 1 il l • Hilcorp Energy Company _ DAILY DRILLING REPO REPORT NO. LEASE WELL NO. COUNTY / PARISH WELL STATE DATE 27 A028399 & A028997 SCU 44-33 SRF SCU 44 -33 AK 10/30/2012 RIG AFE NO. AFE AMOUNT DAILY COST CDC CCC I TOTAL CUM. COST RIG PHONE Arctic Fox 1212791 401850 1 $117,438 $3,129,524 $3,129,524 907- 776 -6776 ACTIVITY TYPE: DRLG Drilling RunCsg RU /Run Csg DEPTH: MD/TVD PROGRESS / HRS PROPOSED TD LAST SHOE TEST PPG DAYS SINCE SPUD AFE DAYS FOREMAN 12425 I 10747 12328 10/17/2012 18 26 Leslie /Greco ACTIVITY SUMMARY AT: 105:30 HRS SURVEY: MD ANGLE AZIMUTH TVD SECTION N / S E / W DOG LEG TIH with 4 1/2" Production Liner - - -- I TIME LOG I ELAPSED ACTIVITY COMMENTS FROM TO TIME 101 jfi Z 6:00 12:30 6.5 (drl)RU /Run C • P/U & RIH with 4 1/2 DWC /C -HT, 12.6 #, L -80 Production Liner 'r Verify operation of floats. 3617.76 includes Shoe Track. (87) joints. Installed Solid body centralizer on tube of first 37 joints. Installed Centralizer on every other joint f/ #38 to #87. Tq conn 1/6500 ft/lb 12:30 14:30 2.0 (drl)RU /Run C- P/U Baker Flex -lock Liner Hanger /ZXP Liner Top Packer. Wiper plug pinned f/1600 psi, Hanger pinned to set @ 2560 & release @ 3300 psi _ Mix and install Pal Mix & allow to set f /30 min. Liner wt 33,000# 14:30 15:00 0.5 Circ & Gond M/U Std #1. Circ Liner volume. R/D Weatherford equipment while circulating. 15:00 22:30 7.5 (drl)Trips TIH f/3655' with 4 1/2" Liner assembly on Dp. Drift each stand run w /2" drift. 22:30 23:30 1.0 Circ & Cond M/U TD on std #62. 8090, CBU @ 4 bpm, 500 psi. 780 units of gas @ B /U. 23:30 1:30 2.0 (drl)Trips Continue TIH f /80901/8969. Drift each stand w /2" drift. 1:30 2:00 1 (drl)RU /Run C M/U TD Plug Dropping Head, XOs and (2) 10' pups. Tq connections & lay do same. Circ &Cond M/U Top Drive. Brk circulation. Record parameters. UP X138, DN 133, ROT 135 Establish rotation. 1OR 1.5 tq, 20R 1.5 tq, 30R 1.5 tq. ROT wt = 135 2:00 4:00 2.0 Circ & Cond Displace 12.6 ppg mud to 11.4 ppg. Take returns to R4R tank. t ts° I", 4:00 6:00 2.0 (drl)Trips TIH with 4 1/2 Production Liner on Dp f/89691/10,070 - TOTAL 24.00 LITHOLOGY: Hemlock MAX GAS 1 B.G. GAS ICON GAS 7TRIP GAS r881 T Accidents None Pollution No Pollution Plan Next 24 Hr Report Attach Circ and cond @ TD. Cement Liner. Hanger Liner & set ZXP. POOH, L/D excess Dp. MUD RECORD CASING RECORD PUMP BPM TYPE [EZ -Mud DATA - GPM SIZE GRADE WT I CONN DEPTH 1 DV ID j NUMBER 1 _12 TIME 1:00 20 NELDEC 377 MAKE Gamd ner Denver ' Garndner Der DEPTH 12425 10 -3/4 J -55 40.5 10.5 MODEL PZ -8 PZ -8 TEMP 70 7 -5/8 N -80 33.7 JTTRE£ 78 _ 6.64 'STROKE 8 8 WEIGHT 11.50 7 -5/8 N -80 26.4 JTTRE/ 4621 6.844 LINER SZ 5.00 5.00 VISC 47.0 7 -5/8 N -80 29.7 JTTRE/ 6111 6.75 SPM PV 14.0 TOP OF LINER @ I GAL /STK 1,96 _ 1.96 YP 17 BIT NO. 4 3 ISUR .PSI 1500 I GELS 5 BHA# SIZE 6.125 6.125 API WL 5 5 MFG. HCC HCC SLOW PUMP DATA @ I HTHP 11.8 DESCRIPTION OD ID FEET TYPE MX -R18DX QD505FHX Pump # PSI 1 PSI 2 PSI 3 Eff % CAKE 1 BIT 6.125 1.5 0.6 SERIAL NO. 5185181 7028065 1 96 SOLIDS 11.8 MOTOR 4.75 3.421 22.04 NOZZLES 3 x 18 5X12 2 96 ADJSOL NM STAB - STRING 6 2.25 5.65 TFA 0.746 0.552 SPM for PSI 1/2/3 OIL % 0.1 DRILL PIPE 4.75 3.5 9.17 DEPTH OUT 12425 12425 DRILL STRING CAPACITY WTR % 86 NM SUB - STOP 5 2.25 1.67 DEPTH IN 12425 9832 BARRELS SD % ON TRAK - MWD 4 2.25 23.37 TOTAL FT. 2593 STROKES MBT 5 MWD STAB - MOD 5 1.15 2.87 HOURS 74.4 POM BCPM 5 1.875 10.76, AVG ROP 34.8 pH 9.2 MWD STOP SUB 5 1,375 2.98 WOB Pm 0.5 Sonic Tool 4.75 2.5 32.88 ANN VEL 335 DEPTH PF /MF 1/4 NM SUB FILTER 4.75 2.75 5.6 ROT. RPM 260 320 TORQUE Clmud DRILL PIPE 3.687 2.312 30.29 AV DP CSG PICK UP 190 Clwtr DRILL PIPE 3.687 2.312 30.87 AV DP OP HLE ROTATIONAL 160 Cal 28500 XO 4.75 2.25 2.39 AV DC 482 SLACK OFF 155 LIME HWDP X 6 4 2.562 181.7 TOT CUM HR 74.4 %LGS 1.9 JARS 5.063 2 31.89 GAUGE ' 1 JAR HOURS 113 ES INNER 0 MUD MOTOR HRS OUTER 1 LOCATION A RP Run Liner TD DULL CHAR. ER CUM HR BHA , LIQ MUD 1 TOTAL LENGTH (FT) 757.94 HYDRAULICS FUEL 2184 GAL ADD (DIESELGAL) TOT WEIGHT (LBS) 22.2 DEPTH 12425 FT CREW BOAT FUEL GAL SOLIDS EQUIPMENT NOZ.AREA .7455 IN' POT. WATER 360 GAL SHAKER #1 1 Derrick 51 DRK 2 d Pb PSI TUG FUEL GAL SHAKER #2 Derrick_ 51 BRDT HRS HHP BIT 1 H BARITE 1277 _ SKS DERRICK #1 DRKS HRS,H.S.I. HP /IN' FUEL USED 993 GAL MUD CLEAN CENT 10 HRS 'JET VEL FT /SEC HEAVY H2O 414 GAL L BOP TESTED PERSONNEL ON BOARD IMP FORCES WEATHER Misc 10/18/2012 HEC 1 %Pb DAILY CUM NEXT TEST DUE RIG 24 BOATS WIND ICalm 1 [MPH MUD 3,800.90 245,400.69, 11/1/2012 SERVICE 23 MN SEAS 28 I (TEMP DIESEL i FUNC. DUE TOTAL 48 MN PRES COND Partly cloudy TOTAL I 1 $245,401 MN FORECAST Same 2001 -2010 WellEz Information Management, LLC. All rights reserved ver 5.17.12b9 n ____,, Hilcorp Energy Company DAILY DRILLING REPO REPORT NO. LEASE WELL NO. COUNTY / PARISH I WELL STATE DATE 26 i A028399 & A028997 SCU 44 -33 SRF SCU 44 -33 AK 10/29/2012 RIG AFE NO. AFE AMOUNT DAILY COST CDC CCC TOTAL CUM. COST RIG PHONE Arctic Fox 1212791 4018500 $89,314 $3,012,086 $3,012,086 907- 776 - 6776__ ACTIVITY TYPE: DRLG Drilling RunCsg RU /Run Csg DEPTH: MD/TVD PROGRESS / HRS PROPOSED TD LAST SHOE TEST PPG DAYS SINCE SPUD AFE DAYS FOREMAN 12425 I 10710 12425 12328 10/17/2012 14.0 17 25 Leslie /Greco ACTIVITY SUMMARY AT: 105:30 HRS SURVEY: I MD ANGLE AZIMUTH TVD SECTION N / S E / W DOG LEG Run 4 1/2 Production Liner TIME LOG ELAPSED ACTIVITY COMMENTS FROM TO TIME tolija i 2 _ 6:00 9:00 3,0 Logging CASE MADD PASS with SLB Sonic tool (/9950 t/9660 9:00 10:30 1.5 Circ & Cond CBU @ 9660 to clear gas and water influx from Annulus. 739 units @ B/U 10:30 11:30 1.0 (drl)Trips IPOOH f/9660 U 9060. M/U TD and circulate while preparing for displacement. 11:30 14:00 2.5 Circ & Cond Displace Casing from 9015 to surface with 12.5 ppg mud. Monitor Well for 30 min. (static) Pump slug 14:00 21:30 7.5 (dri)Trips POOH f/9015 to BHA @ 758. (8) bbls over calc displ on trip out. 21:30 0:00 2.5 (drt)Trips BHA: Stand back HWDP. UD Jars and reminder of Directional tools. 0:00 1:00 1.0 (drl)Misc Clear floor of excess tools. Pull wear bushing. 1:00 4:00 3.0 (drl)RU /Run Ca Rig up Weatherford Tools and stage equipment on rig floor. Had to re- locate power pack due to fumes. Install X0 on Safety Valve 4:00 ' 5:00 1.0 (drt)RU /Run Ca Make up Shoe Track. Bakeriock the first 3 connections. Test operation of Floats U ' ( z_ 5:00 6:00 1.0 (drl)RU /Run CaP /U & RIH w/4 1/2 Production Liner. DWC /C -HT, 12.6 #, L -80, 3.958 ID I - TOTAL 24.00 LITHOLOGY: Hemlock _ MAX GAS 1772 B.G. GAS ICON GAS I (TRIP GAS I I I Accidents None Pollution No Pollution Plan Next 24 Hr Report Attach Run Liner on Dp to Wind ow. Displace Casing to 11.4 ppg. TIH to TO MUD RECORD CASING RECORD PUMP BPM TYPE IEZ -Mud DATA GPM SIZE I GRADE WT CONN DEPTH DV ID NUMBER 1 ' 2 TIME 1:00 20 ELDE 377 1111= MAKE Garndner Denver Garndner Der DEPTH 12425 10 -3/4 J -55 40.5 10.5 MODEL PZ -8 PZ -8 TEMP 70 7 -5/8 N -80 33.7 TTRE' 78 6.64 STROKE 8 8 WEIGHT 11.50 7 -5/8 N -80 26.4 TTRE' 4621 6.844 ' LINER SZ 5.00 5.00 VISC 44 0 7 -5/8 N -80 29.7 TTRE' 6111 6.75 SPM PV 17.0 TOP OF LINER @ GAL/STK 1,96 1.96 YP 18 BIT NO. 4 3 SUR .PSI 1500 GELS 4 BHA# SIZE 6.125 6.125 API WL 5 5 MFG. HCC 1HCC SLOW PUMP DATA © L__ HTHP 11.8 DESCRIPTION OD ID FEET TYPE MX -R18DX 'QD505FHX Pump # PSI 1 PSI 2 PSI 3 Eff % CAKE 1 BIT 6.125 1.5 0.6 SERIAL NO. 5185181 7028065 1 96 SOLIDS 15.6 MOTOR 4.75 3.421 22.04 NOZZLES 3 x 18 5X12 2 _�_ 9 ADJSOL NM STAB - STRING 6 2.25 5.65 TFA 0.746 0.552 SPM for PSI 1/2/3 OIL % 0.1 DRILL PIPE 4.75 3.5 9.17 DEPTH 0U1 12425 12425 DRILL STRING CAPACITY WTR % 182.3 NM SUB - STOP 5 2.25 1.67 DEPTH IN 12425 _ 9832 BARRELS SD % ON TRAK -MWD 4 2.25 23.37 TOTAL FT. 2593 STROKES MBT 5 MWD STAB - MO D 5 1.15 2.87 HOURS 74.4 POM BCPM 5 1.875 10.76 AVG ROP 34.8 pH 8.9 MWD STOP SUB 5 1.375 2.98 WOB Pm 0.25 Sonic Tool 4.75 2.5 32.88 ANN VEL 335 f DEPTH PF /MF 0/3 NM SUB FILTER 4.75 2.75 5.6 ROT. RPM 260 320 TORQUE Clmud DRILL PIPE 3.687 2.312 30.29 AV DP CSG, PICK UP 190 Clwtr DRILL PIPE 3.687 2.312 30.87 AV DP OP HLE' ROTATIONAL 160 Cal 28500 X0 4.75 2.25 2.39 AV DC 482 SLACK OFF 155 LIME HWDP X 6 4 2.562 181.7 TOT CUM HR 74.4 _ 1 %LGS 2 JARS 5.063 2 31.89 GAUGE I JAR HOURS 113 ! ES INNER 0 MUD MOTOR HRS OUTER 1 LOCATION j A RP Run Liner TD DULL CHAR. ER CUM HR BHA LIQ MUD TOTAL LENGTH (FT) 757.94 HYDRAULICS FUEL 3064 GAL ADD (DIESELGAL) TOT WEIGHT (LBS) 22.2 DEPTH 12425 FT CREW BOAT FUEL GAL SOLIDS EQUIPMENT NOZ.AREA .7455 IN' POT. WATER 360 GAL SHAKER #1 Derrick 51 DRK 2 I td Pb PSI TUG FUEL GAL SHAKER #2 Derrick 51 BRDT HRS I HHP BIT HP BARITE 1377 SKS DERRICK #1 DRKS HRS H.S.I. HP /IN' FUEL USED 1304 GAL MUD CLEAN CENT 0 HRS JET VEL FT /SEC HEAVY H2O - 316 GAL I BOP TESTED PERSONNEL ON BOARD _ IMP FORCE WEATHER Misc 10/18/2012 HEC '1 %Pb DAILY 1 CUM NEXT TEST DUE RIG 24 BOATS WIND _Calm I I MPH MUD 7,585.76 241,599.79 11/1/2012 _ SERVICE 23 MN SEAS 12 ITEMP DIESEL I FUNC. DUE TOTAL 48 MN PRES COND Sunny and cool TOTAL j $241,600 MN FORECAST Same 2001 -2010 WeIIEz Information Management, LLC. All rights reserved ver 5.17.12bg n _41, Hilcorp Energy Company _ DAILY DRILLING REPO REPORT NO. LEASE WELL NO. COUNTY / PARISH WELL STATE DATE 25 A028399 & A028997 SCU 44 -33 SRF SCU 44 -33 AK 10/28/2012 RIG AFE NO. AFE AMOUNT DAILY COST CDC CCC TOTAL CUM. COST RIG PHONE A_ rctic Fox 1212791 4018500 $79,811 $2,922,772 1 $2,922,772 907 - 776 -6776 ACTIVITY TYPE: DRLG Drilling Logging Logging DEPTH: MD/TVD PROGRESS / HRS PROPOSED TD LAST SHOE TEST PPG DAYS SINCE SPUD AFE DAYS FOREMAN 12328 10/17/2012 14.0 16 j 24 Leslie /Greco ACTIVITY SUMMARY AT: 105:30 I HRS 1 SURVEY: MD ANGLE AZIMUTH TVD SECTION !1-N / S E / W DOG LEG POOH, Logging with Schlumberger Sonic tool -_ TIME LOG ELAPSED ACTIVITY COMMENTS FROM TO TIME )�L�'t Z 6:00 7:00 1.0 (drl)Trips TIH f/12183 t/12425. Had to M/U Top Drive ea. stand and brk free w /rotation. 7:00 8:30 1.5 Circ & Cond Circulate and condition for Logging and Liner job. 2420 units on B/U 8:30 12:00 3.5 Logging CASE MADD PASS from 12425. (12313 sensor depth) to 11985. - Pull cQ 300 ft /hr, Logging with SLB Sonic tool. Back Ream to break free. Rig transmission overheating form pulling slow, torque converter not locking up 'Forced to backream each stand and then log down to avoid damage to transmission. 12:00 0:00 12.0 Logging CASE Continue MADD PASS f/11985 to 10728. Begin pumping out (no rot) f/11270. 6 bpm igz,6(t2_, 0:00 6:00 6.0 Logging CASE MADD PASS f/10728 to 9950. Rotate through tight spot f/10650 to 10660 TOTAL 24.00 LITHOLOGY: Hemlock MAX GAS j B.G. GAS 160 ICON GAS 1902 [TRIP GAS [3750 _ 1 1 Accidents None Pollution N o Pollution 1 Plan Next 24 Hr Report Attach _ 1 CBU Window / Displace Well Bore to 12.6 ppg / POOH for Production Liner. MUD RECORD CASING RECORD PUMP 3.03 BPM TYPE IEZ -Mud DATA 127 GPM SIZE GRADE WT CONN DEPTH DV ID 1 1 NUMBER 1 2 TIME 0:30 20 NELDEI 377 I MAKE Garndner Denver Garndner Der DEPTH 12425 10 -3/4 J -55 40.5 _ 10.5 __ MODEL PZ -8 PZ -8 TEMP 80 7 -5/8 N -80 33.7 JTTRE1 78 6.64 STROKE 8 8 WEIGHT 11.55 7 -5/8 N -80 26.4 JTTRE1 4621 6.844 LINER SZ 5.00 5.00 VISC 51.0 7 -5/8 N -80 29.7 JTTRq 6111 6.75 SPM 65 PV 18.0 TOP OF LINER @ 1 I_ GAUSTK 1.96 1.96 YP 121 BIT NO. 4 3 ISUR .PSI 11500 GELS 6 BHA# SIZE 6.125 6.125 API WL 3.8 5 MFG. HCC HCC SLOW PUMP DATA © 1 HTHP 10 DESCRIPTION 1 OD ID FEET TYPE MX -R18DX QD505FHX Pump # PSI 1 PSI 2 PSI 3 Eff % CAKE 1 BIT 6.125 1,5 0.6 SERIAL NO. 5185181 7028065 1 96 SOLIDS 11.9 MOTOR 4.75 3.421 22.04 NOZZLES 3 x 18 5X12 2 96 ADJSOL NM STAB - STRING 6 2.25 5.65 TFA 0.746 0.552 SPM for PSI 1/2/3 OIL % 0.1 DRILL PIPE 4.75 3.5 9.17 DEPTH OU 12425 DRILL STRING CAPACITY WTR % 85.8 NM SUB - STOP 5 2.25 1.67 DEPTH IN 12425 9832 BARRELS SD % ON TRAK -MWD 4 2.25 23.37 TOTAL FT. , -12425 2593 STROKES 3 MBT 5 MWD STAB - MOD 5 1.15 2.87 HOURS 74.4 POM 1 BCPM 5 1.875 10.76 AVG ROP 34.8 pH 9.3 MWD STOP SUB 5 1.375 2.98 WOB Pm 0.45 Sonic Tool 4.75 2.5 32.88 ANN VEL 335 DEPTH PF /MF 0/3 NM SUB FILTER 4.75 2.75 5.6 ROT. RPM 260 _320 TORQUE Clmud DRILL PIPE 3.687 2.312 30.29 AV DP CSG PICK UP 190 Clwtr DRILL PIPE 3.687 2.312 30.87 AV DP OP HLE ROTATIONAL t 160 Cal 30000 X0 4.75 2.25 2.39 AV DC 482 SUCK OFF 155 LIME HWDP X 6 4 2.562 181.7 TOT CUM HR , 74.4 %LGS 1.9 JARS 5.063 2 1 31.89 GAUGE I JAR HOURS 113 ES I INNER 0 MUD MOTOR HRS 22 OUTER 1 LOCATION A RP TD DULL CHAR.[ ER CUM HR BHA I ._ LIQ MUD 1 TOTAL LENGTH (FT) 757.94 HYDRAULICS FUEL 4264 GAL ADD (DIESELGAL) TOT WEIGHT (LBS) 22.2 I DEPTH FT CREW BOAT FUEL GAL SOLIDS EQUIPMENT NOZ.AREA .7455 IN' POT. WATER 360 GAL SHAKER #1 !Derrick 51 DRK 2 _ 1 d Pb 131.0144 PSI TUG FUEL GAL SHAKER #2 'Derrick 51 BRDT HRS HHP BIT 1 HP BARITE 1602 SKS DERRICK #1 DRKS HRS H.S.I. 1HP /IN' IFUEL USED 1317 GAL MUD CLEAN CENT 0 HRS JET VEL 54.604 IFT /SEC HEAVY H2O 420 GAL 1 BOP TESTED _ PERSONNEL ON BOARD 'IMP FORCE WEATHER Misc 10/18/2012 HEC 1 %Pb _ DAILY CUM NEXT TEST DUE RIG 24 BOATS WIND Calm MPH MUD 3,197.71 234,014.03 11/1/2012 SERVICE 17 MN SEAS 18 (TEMP DIESEL FUNC. DUE TOTAL 42 MN PRES COND Sunny & Cool TOTAL $234,014 MN FORECAST Same 2001 -2010 WellEz Information Management, LLC. All rights reserved ver 5.17.12bg n ___4,_. Hilcorp Energy Company DAILY DRILLING REP010 REPORT NO. LEASE WELL NO. COUNTY / PARISH WELL STATE DATE 24 A028399 & A028997 SCU 44 -33 SRF SCU 44 -33 AK 10/27/2012 RIG AFE NO. AFE AMOUNT DAILY COST CDC CCC TOTAL CUM. COST RIG PHONE Arctic Fox 1212791 4018500 $102,617 $2,842,961 $2,842,961 907 - 776 -6776 ACTIVITY TYPE: DRLG Drilling C &C Circ &Cond DEPTH: MD/TVD PROGRESS / HRS PROPOSED TD LAST SHOE TEST PPG DAYS SINCE SPUD AFE DAYS FOREMAN 12425 1 10747 12328 _ 10/17/2012 14.0 15 23 Leslie /Greco ACTIVITY SUMMARY AT: 105:30 1 HRS 1 SURVEY: MD ANGLE AZIMUTH TVD SECTION N / S E / W 1 DOG LEG TIH with Clean out/Sonic BHA . TIME LOG ELAPSED ACTIVITY COMMENTS FROM TO TIME 6:00 7:00 1.0 (drl)Trips BHA: Finish downloading data f /LWD. Inspect Motor and Bit. t0 li'lL Motor Bearing was extruding 1/4". Bit was in good condition. 0- 1- ER- A- X- I -CT -TD _ 7:00 8:30 1.5 Tstg BOP/WH/ Pull Wear Bushing. R/U to Test VBRs on 4 1/2" Test Joint _ 8:30 10:00 1.5 'Tstg BOP/WH/ Test VBR (Upper Rams) to 250L/5000H. Test Annular t/250L /2500H. 1 /10 ea. test 10:00 11:00 1.0 'Tstg BOP/WH/ R/D test equipment and install Wear Bushing. 11:00 15:00 4.0 (drl)Trips MU BHA 5: RR HCC Insert, Mtr, NM Stab, NMDC, Stop Sub, MWD, BCPM, Sonic, Filter (2) NMDC, XO, (6) HWDP, Jar, (12) HWDP = 757.94 I Orient, Upload MWD, Surface test Tools. RIH w /HWDP. 15:00 22:30 7.5 (drl)Trips TIH wfDp from 758' to Window @ 9000. PJSM on fluid displacement. 22:30 0:00 1.5 Circ & Cond Nose bit out window t19022. Displ Csg from 12.6 ppg to 11.4 ppg. 4 bpm. 940 psi 0:00 0:30 0.5 Circ & Cond Blow down Choke and Mud lines 0:30 2:30 2.0 (drl)Trips TIH f/9022 U10000. Fill pipe, Continue to TIH to 11,040. 2:30 4:00 1.5 Circ & Cond CBU @ 11040 to clear annulus of influx prior to entering Hemlock. Rotate & Reciprocate pipe. 7.2 bpm, 2910 psi, 60 rpm, 3 -7k tq. 3750 units @ B/U 10 1Z,7It 4:00 6:00 2.0 (drI)Trips TIH f/11040 t/12,183. Wash & Ream tight spot f/11801 t/11840. f Begin getting differentially stuckeach time in slips, starting f/11865. M/U TD on each stand and brk free with rotation to enable lowering of stand TOTAL 24.00 LITHOLOGY: Hemlock MAX GAS 13750 B.G. GAS ICON GAS 1 1TRIP GAS _ 1 Accidents None Pollution No Pollution [Plan Next 24 Hr Report Attach , j Circ and cond. for Liner. POOH @ 450 ft/hr for Sonic log _ MUD RECORD CASING RECORD , - I PUMP 6.06 BPM TYPE EZ -Mud 1 'DATA 255 GPM 1 SIZE GRADE 1 WT CONN DEPTH_ 1 DV ID J' ' NUMBER 1 2 TIME 0:30 20 r ELDE I 377 ' MAKE Gamdner Denver Garndner Der DEPTH 12425 10-3/4 J -55 40.5 1 10.5 MODEL PZ -8 • PZ -8_ TEMP 80 7 -518 N -80 33.7 TTRE' 78 6.64 STROKE 8 , 8 WEIGHT 11.55 7 -5/8 N -80 26.4 TTRE' 4621 6.844 , LINER SZ 5,00 11 5.00 VISC 49.0 1 7 -5/8 N -80 29.7 TTRE' 6111 6.75 ' SPM 65 65 PV 20.0 I TOP OF LINER @ T _ GAUSTK 1.96 1.96 YP 120 BIT NO. 4 3 1SUR .PSI 3300 1 13300 GELS 6 BHA# SIZE 6.125 6.125 API WL 3.6 51MFG. HCC HCC SLOW PUMP DATA @ HTHP 10 DESCRIPTION OD ID FEET TYPE 'MX -R18DX 1QD505FHX Pump # PSI 1 PSI 2 PSI 3 Eff % CAKE 1 BIT 6.125 1.5 0.6 SERIAL NO. 518518 7028065 1 , 96 SOLIDS 11.8 MOTOR 4.75 3.421 22.04 NOZZLES 3 x 18 5X12 2 ' 96 ADJSOL NM STAB - STRING 6 2.25 5.65 TFA 0.746 0.552 SPM for PSI 1/2/3 J _ OIL % 0.1 DRILL PIPE 4.75 , 3.5 9.17 DEPTH OUT 12425 DRILL STRING CAPACITY__ WTR % 85.8 NM SUB - STOP 5 2.25 1.67 DEPTH IN 12425 1 9832 BARRELS SD % ON TRAK - MWD 4 2.25 23.37 TOTAL FT. -12425 2593 t STROKES MBT 5 MWD STAB - MOD 5 1.15 2.87 HOURS 74.4 POM BCPM 5 1.875 10.76 AVG ROP 34.8 pH 9 _ MWD STOP SUB 5 1 1.375 2.98 1 WOB 3 -7 _ Pm 0.4 Sonic Tool 4.75 2.5 32.88 ANN VEL 335 DEPTH PF /MF 1/3 NM SUB FILTER 4.75 2.75 5.6 ROT. RPM 320 TORQUE Clmud DRILL PIPE 3.687 2.312 30.29 AV DP CSG PICK UP 190 Clwtr DRILL PIPE 3.687 2.312 30.87 AV DP OP HLE ROTATIONAL 160 Cal 31000 XO _ 4.75 2.25 2.39 AV DC 482 SLACK OFF 155 LIME HWDP X 6 4 2.562 , 181,7 TOT CUM HR 1 74.4 %LGS 11.8 JARS 5.063 2 1 31.89 GAUGE I JAR HOURS 113 ES 1 INNER 0 ' MUD MOTOR HRS OUTER 1 LOCATION A RP , TD DULL CHAR. I I ER CUM HR BHA 1 LIQ MUD 1 TOTAL LENGTH (FT) 757.94 HYDRAULICS FUEL 5449 GAL ADD (DIESELGAL) TOT WEIGHT (LBS) 22.2 DEPTH 112425 FT CREW BOAT FUEL GAL SOLIDS EQUIPMENT NOZ.AREA .7455 IN" POT. WATER 11860 GAL SHAKER #1 Derrick 51 DRK 2 1 d Pb 124.058 PSI TUG FUEL GAL SHAKER #2 Derrick 51 HRS HHP BIT HP BARITE 1602 SKS DERRICK #1 DRKS HRS jH.S.I. HP /IN' FUEL USED 1168 ,GAL MUD CLEAN CENT 0 HRS 1 JET VEL 109.208 FT /SEC HEAVY H2O _ 420 -- "91 AL __ BOP TESTED _ PERSONNEL ON BOARD IMP FORCE WEATHER Misc 10/18/2012 ;HEC 11 %Pb DAILY CUM NEXT TEST DUE RIG 124 BOATS WIND Calm MPH MUD 2,384.96 230,816.32 11/1/2012 SERVICE 17 MN SEAS 28 TEMP DIESEL FUNC. DUE TOTAL 42 MN PRES COND Partly cloudy TOTAL _ $230,816 MN FORECAST S ame 2001 -2010 WellEz Information Management, LLC. All rights reserved ver 5.17.12bg • Hilcorp Energy Company DAILY DRILLING REPO REPORT NO. LEASE WELL NO. COUNTY / PARISH WELL STATE DATE 23 A028399 & A028997 SCU 44 -33 SRF SCU 44 -33 AK 10/26/2012 RIG AFE NO. AFE AMOUNT DAILY COST CDC CCC 1 TO_ TAL CUM. COST RIG PHONE Arctic Fox 1212791 4018500 $119,682 $2,740,344 1 $2,740,344 907- 776 -6776 ACTIVITY TYPE: DRLG Drilling TOH Tripping out of Hole DEPTH: MD/TVD PROGRESS / HRS PROPOSED TD LAST SHOE TEST PPG DAYS SINCE SPUD AFE DAYS FOREMAN 12425 I 10746 12328 10/17/2012 14.0 14 22 Leslie /Greco ACTIVITY SUMMARY AT: 05:30 HRS 1 SURVEY: MD I ANGLE AZIMUTH TVD l SECTION 1 N / S E / W DOG LEG Downloading data from MWD/LWD TIME LOG ELAPSED ACTIVITY COMMENTS FROM TO TIME 4-41- 6:00 10:30 4.5 (drl)Trips POOH Back - reaming f/12425, t/11196. 60 rpm, 6 bpm, 2400 psi. Unable to straight pull. Differential sticking each time out of slips M/U TD and break free each time with rotation. (2 -5k over normal torque) Wall sticking ceased abruptly once above 11,270. 10:30 11:30 1.0 Circ & Cond CBU @ 11,196 to clear cuttings from back- reaming. 750 units @ B/U _ 11:30 13:00 1.5 (drl)Trips Straight pull f/11,196 t/9,750. UP 180k, no tight spots to report _ 13:00 14:00 1.0 Circ & Cond CBU @ 9750 to clear possible gas and water flow from Annulus. 7 bpm, 2880 psi, RPM 70. 3604 units from B/U and diluted from 11.4 to 10.9 14:00 14:30 0.5 (drl)Trips Pull additional 10 stands to place bit @ 9110 (window @ 9015) 14:30 17:30 3.0 Circ & Cond Displace Well f/9110 to surface w/12.6 ppg Mud. Circulate thru 3/4 open choke to keep heavy mud from u- tubing when pumping slow _ 17:30 18:30 1.0 Circ & Cond Monitor Well for 30 min (no flow) Mix and pump Slug 18:30 3:00 8.5 (drl)Trips POOH from 9110 to BHA © 784'. Flow check Well +/- 2500 & © BHA (No flow) 3:00 4:30 1,5 (drl)Trips BHA: Std back HWDP & Jars. PJSM. Remove RA Source. (o tZbiti Y 4:30 6:00 1.5 (drl)Trips Baker downloaded data f /MWD while suspended from Blocks. TOTAL 24.00 LITHOLOGY: Hemlock MAX GAS 1389 B.G. GAS CON GAS 1215 TRIP GAS 3694 T _ Accidents None Pollution No Pollution Plan Next 24 Hr Report Attach ,Finish working BHA / Test VBR rams on 4 1/2 / MU BHA #5 / Til-1 to window MUD RECORD CASING RECORD PUMP 6.99 BPM TYPE FEZ-Mu _ d _ DATA 294 , GPM SIZE GRADE WT CONN 1 DEPTH DV ID NUMBER 1 E- 2 TIME 2:00 20 VELDEI 377 MAKE Gamdner Denver Garndner Der DEPTH 12425 10 -3/4 J -55 40.5 10.5 MODEL PZ -8 PZ -8 TEMP 80 7 -5/8 N -80 33.7 'JTTRE: 78 6.64 STROKE 8 8 WEIGHT 12.50 7 -5/8 N -80 26.4 JTTRE 4621 [ 6.844 LINER SZ 5.00 5.00 VISC 55.0 7 -5/8 N -80 29.7 JTTRE1 6111 � 6 SPM 75 75 PV 21.0 TOP OF LINER @ r GAL /STK 1.96 1.96 YP 26 I BIT NO. 3 rSUR .PSI 13300 r 3 GELS 7 BHA # SIZE 6.125 API WL 3.8 4 MFG. HCC SLOW PUMP DATA @ 19110 HTHP 10.8 DESCRIPTION I OD ID FEET TYPE QD505FHX _ Pump # PSI 1 1 PSI 2 PSI 3 Eff % CAKE 1 BIT 6.125 1.5 0.9 SERIAL NO. 7028065 1 730 � 96 SOLIDS 15.4 MOTOR 4.75 3.421 22.07 NOZZLES 5X12 2 96 ADJSOL ORIENT SUB 4.75 1.5 2.15 1TFA 0.552 SPM for PSI 1/2/3 65 OIL % 0.1 'NM STAB - STRING 6 2.25 5.65 DEPTH OUT 12425 DRILL STRING CAPACITY WTR % 82.3 NM Drill collar - sho i 4.75 2.25 8.86 DEPTH IN 9832 BARRELS SD % DRILL PIPE 4.75 3.5 ; 9.17 TOTAL FT. 2593 STROKES 2840 MBT 5 NM SUB - STOP 5 2.25 1.67 HOURS 74.4 POM ON TRAK - MWD 4 2.25 23.37 AVG ROP 34.8 pH 9 MWD STAB - MOD 5 1.15 2.87 WOB 3 -7 Pm 0.4 ' BCPM 5 1 1.875 10.76 ANN VEL , 335 DEPTH PF /MF 2/2 MWD STAB - MOD 5.125 1.625 2.85 ROT. RPM 320 TORQUE Clmud SDN 5.312 1.625 14.4 AV DP CSG PICK UP 185 Clwtr MWD STOP SUB 5 1.375 AV DP OP HLE ROTATIONAL 160 Cal 131000 NM SUB FILTER 4.75 Lim • AV DC 482 SLACK OFF 155 LIME DRILL PIPE 4.562 2.25 30.83 TOT CUM HR 74.4 %LGS 1.8 DRILL PIPE 3.687 2.312 30.29 GAUGE JAR HOURS 113 ES INNER MUD MOTOR HRS 160 OUTER LOCATION RP TD 1 I DULL CHAR CUM HR BHA 177 LIQ MUD I TOTAL LENGTH (FT) 1784.48 I HYDRAULICS FUEL 6520 GAL ADD (DIESE_LGAL) TOT WEIGHT (LBS) 22.5 1DEPTH 12425 FT CREW BOAT FUEL GAL SOLIDS EQUIPMENT NOZ.AREA .552 IN' POT. WATER _1860 GAL SHAKER #1 Derrick 51 DRK 2 I 1 d Pb 326.035 PSI TUG FUEL i GAL SHAKER #2 Derrick 51 BRDT HRS HHP BIT HP BARITE 1602 SKS DERRICK #1 DRKS HRS H.S.I. HP /IN' FUEL USED 1560 GAL MUD CLEAN _ ,CENT 0 HRS JET VEL 170.295 FT /SEC HEAVY H2O 332 GAL I BOP TESTED PERSONNEL ON BOARD IMP FORCE T WEATHER Misc 10/18/2012 HEC 1 %Pb 1 I i DAILY 1 CUM NEXT TEST DUE RIG 24 BOATS 'WIND Calm 1MPH MUD 7,313.50 228,431.36 11/1/2012 SERVICE 18 MN I ^ SEAS 25 I TEMP DIESEL FUNC. DUE TOTAL 43 MN j PRES COND ;Clear and cool TOTAL _J $228,431 ■ MN FORECAST 1Same 2001 -2010 WellEz Information Management, LLC. All rights reserved ver 5.17.12bg 10 "" - H ilcorp Energy Company _ DAILY DRILLING REPO$ REPORT NO. LEASE WELL NO. COUNTY / PARISHT WELL 1 STATE DATE 22 A028399 & A028997 SCU 44 -33 SRF SCU 44 -33 1 AK 10/25/2012 RIG AFE NO. AFE AMOUNT DAILY COST _ CDC CCC TOTAL CUM. COST RIG PHONE Arctic Fox 1212791 4018500 $128,666 $2,620,662 $2,620,662 907- 776 -6776 ACTIVITY TYPE: DRLG Drilling Drilling r Drilling DEPTH: MD/TVD PROGRESS / HRS PROPOSED TD LAST SHOE TEST PPG DAYS SINCE SPUD ' AFE DAYS 1 FOREMAN 12425 T10747 400 12328 10/17/2012 14.0 13 21 Leslie /Greco ACTIVITY SUMMARY AT: 105:30 rHRS SURVEY: MD ANGLE AZIMUTH I ND SECTION N / S E / W DOG LEG Circulate and condition for POOH. 12425 60.53 82.12 10746.94 2772.12 1030.32 2751.74 12351 60.53 82.12 10710.54 2707.74 1021.49 2687.92 0.26 12250 60.45 81.83 10660.79 2619.9 1009.22 1 2600.89 0.68 12172 60.09 81.38 10622.11 2552.19 999.33 2533.88 0.67 12108 59.66 81.39 10589.99 2496.86 991.04 2479.15 1.09 TIME LOG ELAPSED ACTIVITY COMMENTS FROM TO TIME 1 0 1 Z �I tL 6:00 8:00 2.0 Drilling Rotary Drill f/12025 U12075. UP 190, DN 148, R165, RPM 55, TQ 6,000 8:00 10:00 2.0 Circ & Cond CBU for Short trip. Attempt to straight pull, but unable to brk over. Circ. 2nd circulation @ max rate. 7.8 bpm 3750 psi. 80 RPM, 6.5 tq Rot. and recip. throughout circ. Minimal increase in cuttings during circulation Stop rotation while in upstroke. String stalled with overpull of 60k. 10:00 12:00 2.0 Short Trips Backream from 12072 to 11565. Free string with rotation each time out of slips. 12:00 12:30 0.5 Circ & Cond Crew change. CBU @ 7.5 bpm. 415 units of gas. 12:30 13:00 0.5 Short Trips Straight pull f/11565 to 11240 to place bit above Tyonek G1. 13:00 14:00 1,0 Short Trips TIH f/11240 t/12072. Set down on obstructions @ 11591 & 11760. Wash & Ream each, 1 Differential sticking @ connections 11820, 11883, 11946 & 12009. Forced to M/U TD and rotate off wall. String broke free easily w /7 -8k tq. 14:00 14:30 0.5 Circ & Cond M/U TD, brk circulation and MWD Survey @ 12070'. Short Trip produced 3930 units of gas (prior to B /U) Mud Logger noted gas Lag came from +/- 9100'. 14:30 4:00 13.5 Rotary Drilling Drill 6 1/8" hole f/12072 t/TD @ 12425 as per Geologist. TD Well @ 04:10 Final survey placed TD 31.8' above & 15.27 right of planned target IA) V51( 7.-- 4:00 6:00 _ 2.0 Circ & Cond Circ & Cond., UP 190, DN 150, R 160, 60 rpm, 6 -7k tq, 7.5 bpm, 3570 psi TOTAL 24.00 'LITHOLOGY: ,Hemlock MAX GAS 1448 B.G. GAS 97 ICON GAS 1302 1TRIP GAS 13930 Accidents None Pollution No Pollution Plan Next 24 Hr Report Attach _ Trip out of hole for Sonic Logging tool MUD RECORD CASING RECORD PUMP 6.99 BPM TYPE 1EZ -Mud DATA 294 GPM SIZE I GRADE WT CONNi DEPTH DV 1 ID NUMBER 1 2 TIME 1:00 20 ELDE 377 MAKE Garndner Denver Garndner Der DEPTH 12300 10 -3/4 J -55 40.5 10.5 MODEL PZ -8 1PZ -8 TEMP 88 7 -5/8 N -80 33.7 JTTRE: 78 6.64 STROKE 8 ------_ 8 WEIGHT 11.40 7 -5/8 N -80 26.4 JTTRE; 4621 6.844 LINER SZ 5.00 5.00 VISC 50.0 7 -5/8 N -80 29.7 JTTRE1 6111 6.75 SPM 75 75 PV 20.0 TOP OF LINER @ I GAUSTK 1.96 1.96 YP 125 I BIT NO. 13 ISUR .PS I 3300 13300 GELS 6 BHA# SIZE 6.125 API WL 3.8 4 MFG. HCC SLOW PUMP DATA @ 112425 HTHP 10.8 DESCRIPTION OD ID FEET TYPE QD505FHX Pump # PSI 1 PSI 2 PSI3 Eff % CAKE 1 BIT 6.125 1.5 0,9 SERIAL NO. 7028065 1 920 1280 96 SOLIDS 11 MOTOR 4.75 3.421 22.07 NOZZLES 5X12 2 910 1260 ' 96 ADJSOL ORIENT SUB 4.75 1.5 2.15 TFA 0.552 SPM for PSI 1/2/3 65 85 OIL % 0.1 NM STAB - STRING 6 2.25 5.65 DEPTH OUT 12425 I DRILL STRING CAPACITY WTR % 86.6 NM Drill collar - short 4.75 2.25 8.86 DEPTH IN 9832 BARRELS SD % DRILL PIPE 4.75 3.5 9.17 TOTAL FT. 2593 STROKES 2837 MBT NM SUB - STOP 5 2.25 1.67 HOURS 74.4 POM ON TRAK - MWD 4 2.25 23.37 AVG ROP 34.8 - pH 10 MWD STAB - MOD 5 1.15 2.87 WOB 3 -6 Pm :0.8 BCPM 5 1.875 10.76 ANN VEL 335 DEPTH PF/MF 1/3 MWD STAB - MOD 5.125 1.625 2.85 ROT. RPM '320 TORQUE 6500 Clmud SDN 5.312 1.625 14.4 AV DP CSG PICK UP 185 Clwtr MWD STOP SUB 5 1.375 2.98 AV DP OP HLE ROTATIONAL 160 Cal 31000 NM SUB FILTER 4.75 2.75 5.6 AV DC 482 SLACK OFF 155 LIME DRILL PIPE 4.562 2.25 30.83 TOT CUM HR 74.4 %LGS 1.2 DRILL PIPE 3.687 1 2.312 30.29 GAUGE JAR HOURS 113 ES INNER 1 MUD MOTOR HRS 192 OUTER LOCATION RP TD DULL CHAR. 1 CUM HR BHA 77 _ _- LIQ MUD 1 TOTAL LENGTH (FT) 1 784.48 _ HYDRAULICS FUEL - 5209 GAL ADD (DIESELGAL) TOT WEIGHT (LBS) 22.5 DEPTH 12425 FT CREW BOAT FUEL GAL SOLIDS EQUIPMENT NOZ.AREA .552 IN' POT. WATER 1860_ GAL SHAKER #1 Derrick 51 DRK 2 j d Pb 297.344 PSI TUG FUEL GAL SHAKER #2 Derrick 51 BRDT HRS HHP BIT HP BARITE 1602 SKS DERRICK #1 DRKS HRS H.S.I. HP /IN' FUEL USED 1517 GAL MUD CLEAN CENT 0 FIRS JET VEL 170.295 FT /SEC HEAVY H2O 558 GAL BOP TESTED PERSONNEL ON BOARD 1IMP FORCE WEATHER' Misc 10/18/2012 HEC 1 %Pb DAILY CUM NEXT TEST DUE_ RIG 24 BOATS WIND Calm MPH MUD 11,649.05 221,117.86 11/1/2012 SERVICE 18 MN SEAS 20 TEMP DIESEL FUNC. DUE TOTAL 43 MN PRES COND Sunny & cold TOTAL $221,118 MN , 1 FORECAST Same 2001 -2010 WellEz Information Management, LLC. All rights reserved ver 5.17.12bg Hilcorp Ener Company D AI LY DR ILLI NG RE PO REPORT NO. LEASE WELL NO. COUNTY / PARISH WELL STATE DATE 21 A028399 & A0289 SCU 44 -33 SRF SCU 44 -33 AK 10/24/2012 RIG AFE NO. AFE AMOUNT DAILY COST CDC CCC 1 TOTAL CUM. COST RIG PHONE Arctic Fox 1212791 4018500 $187,266 $2,491,996 t $2,491,996 907-776-6776 ACTIVITY TYPE: DRLG Drilling Drilling Drilling DEPTH: MD/TVD PROGRESS / HRS PROPOSED TD LAST SHOE TEST PPG DAYS SINCE SPUD AFE DAYS FOREMAN 12025 1 10549 385 12328 10/17/2012 14.0 12 _ 20 Leslie /Greco ACTIVITY SUMMARY AT: 05:30 1HRS 1 SURVEY: MD ANGLE AZIMUTH ND SECTION N /S E /W DOG LEG Drilling Production interval in Hemlock 11810 58.56 81.26 10436.53 2241.46 951.80 2226.73 1.06 11748 58.53 80.49 10404.18 2188.58 943.42 2174.51 0.55 11688 58.3 80.21 10372.75 2137.47 934.85 2124.12 0.93 11628 58.07 80.81 10341.12 2086.49 926.44 2073.84 0.14 115651 58.12 80.9 10307.92 2033.01 917.94 2021.03 1.39 TIME LOG ELAPSED ACTIVITY COMMENTS FROM TO TIME to(z) I1 7s 6:00 12:00 6.0 Drilling Drill f/11640 t/11710. Confirmed top of Hemlock @ 11519. Trouble Slide Drilling UP 185k, DN 148k, ROT 160k, 7 bpm, 3250 psi, 11.3 ppg, 12.15 ECD, 55 RPM, 5k tq Pumped 22 bbl high vis sweep CO 11,665. 50% increase in ctgs when sweep returned. 12:00 18:00 6.0 Rotary Drilling Drill f/11710 t/11778. Vary parameters to maximize P -rate. 11 ft /hr ave rop 18:00 0:00 6.0 Rotary Drilling Rotary Drill f/117781/11910. 22 ft/hr ave rop Drilling brk @ 11801, 95 ft/hr (coal). ROP below coal is 20 to 60 ft/hr 0:00 6:00 6.0 Rotary Drilling Rotary Drill f/11910 to 12025. 19.2 ft/hr ave rop. No losses to formation. LO'� I I 2 ,._ TOTAL 24.00 LITHOLOGY: Hemlock MAX GAS 791 B.G. GAS 114 'CON GAS 1 591 TRIP GAS __ - I_ Accidents None Pollution No Pollution [Plan Next 24 Hr Report Attach Drill to TD MUD RECORD CASING RECORD I PUMP 6.85 BPM TYPE 1EZ-Mud i 1 DATA 288 GPM SIZE GRADE WT CONN DEPTH DV ID I NUMBER 1 ' '2 TIME 2:00 20 VELDEI 377 ! MAKE Garndner Denver Garndner Der DEPTH 11908 10 -3/4 J -55 40.5 10.5 MODEL PZ -8 PZ -8 TEMP 92 7 -5/8 N -80 33.7 JTTRE° 78 6.64 STROKE 8 8 WEIGHT 11.35 7 -5/8 N -80 26.4 JTTRE: 4621 6.844 LINER SZ 5.00 5.00 VISC 51.0 7 -5/8 N -80 29.7 JTTRE: 6111 6.75 1 SPM 73 1 74 PV 23.0 TOP OF LINER @ 1 I GAUSTK 1.96 ^ 1.96 YP 25 1 BIT NO. 3 'SUR .PSI 13200 J j 3200 GELS 8 BHA# SIZE 6.125 API WL 3.6 4 MFG. HCC SLOW PUMP DATA @ 111825 HTHP 10 DESCRIPTION OD ID FEET TYPE QD505FHX Pump # PSI 1 PSI 2 PSI 3 Eff % CAKE 1 BIT 6.125 1.5 0.9 SERIAL NO. 7028065 1 910 96 SOLIDS 11 MOTOR 4.75 3.421 22.07 NOZZLES 5X12 2 890 96 ADJSOL ORIENT SUB 4.75 1.5 2.15 TFA 0.55 SPM for PSI 1/2/3 65 OIL % , 0.1 NM STAB - STRING 6 2.25 5.65 DEPTH OUT DRILL STRING CAPACITY WTR % ! 86.5 NM Drill collar - short 4.75 2.25 8.86 DEPTH IN 9832 BARRELS SD % DRILL PIPE 4.75 3.5 917 TOTAL FT. -9832 STROKES 2740 MBT 6.5 NM SUB - STOP 5 2.25 1.67 HOURS 56 POM ON TRAK - MWD 4 2.25 23.37 AVG ROP pH 9.8 MW D STAB - MOD 5 1.15 2.87 WOB Pm 0.8 BCPM 5 1.875 10.76 ANN VEL DEPTH PF /MF 1/3 MWD STAB - MOD 5.125 1.625 2.85 ROT. RPM 320 TORQUE 6000 Clmud SDN 5.312 1.625 14.4 AV DP CSG PICKUP 185 Clwtr MWD STOP SUB 5 1.375 2.98 AV DP OP HLE ROTATIONAL _ 160 Cal 31500 NM SUB FILTER 4.75 2.75 5.6 AV DC SLACK OFF ! 155 LIME DRILL PIPE 4.562 2.25 30.83 TOT CUM HR 56 %LGS 1.7 DRILL PIPE 3.687 2.312 30.29 GAUGE JAR HOURS 85 ES INNER MUD MOTOR HRS 160 OUTER ! LOCATION RP DULL CHAR. I CUM HR BHA 58.9 LIQ MU TOTAL LENGTH (FT) j784.48 HYDRAULICS FUEL 6726 GAL ADD (DIESELGAL) ,TOT WEIGHT (LBS) 122.5 DEPTH 12025 FT CREW BOAT FUEL GAL SOLIDS EQUIPMENT 1NOZ.AREA .552 IN POT. WATER 1860 GAL SHAKER #1 Derrick 51 DRK 2 1 1 d Pb 284.317 PSI TUG FUEL GAL ! SHAKER #2 Derrick 51 BRDT HRS HHP BIT HP BARITE 1SKS DERRICK #1 DRKS ,HRS H.S.I. HP /IN' FUEL USED 1520 GAL MUD CLEAN CENT 0 HRS JET VEL 166.889 FT /SEC HEAVY H2O [486 GAL 1___ i BOP TESTED PERSONNEL ON BOARD IMP FORCE I WEATHER Misc 10/18/2012 HEC '2 _ %Pb L DAILY CUM NEXT TEST DUE RIG 24 _ BOATS WIND Calm MPH MUD 15,419.38 209,468.81 _ 11/1/2012 SERVICE 18 MN SEAS 24 TEMP DIESEL FUNC. DUE TOTAL 44 MN PRES COND Partly cloudy TOTAL $209,469 iMN FORECAST Same 2001 -2010 WellEz Information Management, LLC. All rights reserved ver 5.17.12bg Hilcorp Ener y Company DAILY DRILLING REPO REPORT NO. LEASE WELL NO. f COUNTY / PARISH WELL STATE DATE 20 A028399 & A028997 SCU 44 -33 SRF SCU 44 -33 AK 10/23/2012 RIG AFE NO. AFE AMOUNT DAILY COST CDC CCC TOTAL CUM. COST RIG PHONE Arctic Fox 1212791 4018500 $145,040 $2,304,730 $2,304,730 907- 776 -6776 ACTIVITY TYPE: DRLG Drilling Drilling ■ Drilling DEPTH: MD/TVD PROGRESS / HRS PROPOSED TD LAST SHOE TEST PPG DAYS SINCE SPUD AFE DAYS FOREMAN 11640 10346 261 12328 10/17/2012 14.0 11 19 Leslie /Greco ACTIVITY SUMMARY AT: 05:30 HRS SURVEY: MD ANGLE AZIMUTH ' ND SECTION N / S E /W DOG LEG Drilling Production interval through Hemlock formation 11503 57.86 79.93 10274.96 1980.44 909.19 1692.20 1.24 11440 57.49 79.12 1024.27 1927.2 899.51 1916.85 2.05 11378 57.2 77.65 10202.82 1875.03 889.00 1865.72 1.26 1 TIME LOG ELAPSED ACTIVITY COMMENTS FROM TO TIME I J+Z Z+rz_ 6:00 8:30 2.5 Short Trips Continue pulling Short Trip to Window F /11,000'. Hole in good condition. 8:30 9:30 1.0 Circ & Cond CBU @ 275 gpm, 2400 psi, 1412 units of gas 9:30 12:30 3.0 Short Trips Trip in hole F/ 9053 T/11325, p/u 185k, s/o 138k _ 12:30 15:00 2.5 Circ & Cond CBU , 3760 units gas 15:00 18:00 3.0 Drilling Rotate and slide F/ 11395 T/ 11510, 300 gpm, 3400 SPP, 50 rpm, 5/8 wob, 18:00 0:00 6.0 Drilling Rotate and slide F/ 11510 T/11592, p/u 188, s/o 152k, rot 158k, 290 gpm, Drilling 3140 PSI, ADT 5.5, AST .9, Bit hrs 41, 0IZ3+tz- 0:00 6:00 6.0 Drilling Rotate and slide F/11510 T/ 11640, Gpm 290, torq on bottom 5.6, off 4.8, Drilling spp 3025, rpm 50, p/u 188k, s/o 152, rlw 158 I TOTAL 24.00 LITHOLOGY: Hemlock MAX GAS 1388 B.G. GAS 132 ICON GAS 367 _ _TRIP GAS 3760 I _ Accidents 'None Pollution I No Pollution 'Plan Next 24 Hr Report Attach 1 _ Drill 6.125 Production hole MUD RECORD CASING RECORD I ?PUMP BPM TYPE 1EZ-Mud DATA GPM SIZE GRADE W T CONN DEPTH DV ID NUMBER 1 2 TIME 23:59 20 ELDE' 377 _ MAKE Garndner Denver • Garndner Der DEPTH 11592 10 -3/4 J -55 40.5 ' 10.5 MODEL PZ -8 PZ -8 TEMP 90 7 -5/8 N -80 33.7 TTRE' 78 6.64 STROKE 18 18 WEIGHT 11.40 ' N -80 I 26.4 TTRE' 4621 6.844 LINER SZ 5.00 •5.00 VISC 47.0 7 -5/8 N -80 29.7 TTRE' 6111 1 6.75 SPM PV 18.0 TOP OF LINER 1 GAL /STK 1.96 •1.96 YP 21 BIT NO_ . 3 1SUR .PSI 13300 L1 GELS 5 BHA# SIZE 6.125 API WL 4 MFG. HCC SLOW PUMP DATA (g 111630 HTHP 10.2 DESCRIPTION OD ID FEET TYPE IQD505FHX E. Pump# PSI 1 PSI2 PSI3 Eff% CAKE 2 BIT 6.125 1.5 0.9 SERIAL NO. 7028065 1 850 1250 96 SOLIDS 10.5 MOTOR 4.75 3421 22.07 NOZZLES 5X12 2 1 96 ADJSOL ORIENT SUB 4.75 1.5 2.15 TFA 0.552 SPM for PSI 1/2/3 65 87 OIL % NM STAB - STRING 6 2.25 5.65 DEPTH OUT DRILL STRING CAPACITY WTR % 86.5 NM Drill collar- sho ■ 4.75 2.25 8.86 DEPTH IN 9832 BARRELS SD % DRILL PIPE 4.75 3.5 9.17 TOTAL FT. -9832 STROKES 2655 MBT 1.5 NM SUB - STOP 5 2.25 1.67 HOURS 56 POM ON TRAK - MWD 4 2.25 23.37 AVG ROP pH 9.8 MWD STAB - MOD I 5 1.15 2.87 WOB Pm BCPM 5 1.875 10.76 ANN VEL DEPTH PF /MF MWD STAB - M_ OD 5.125 1.625 2.85 ROT. RPM 320 TORQUE 6000 Clmud SDN 5.312 1.625 14.4 AV DP CSG PICK UP 182 Clwtr 1 MWD STOP SUB 5 1.375 2.98 AV DP OP HLE ROTATIONAL 154 Cal 30500 NM SUB FILTER 4.75 2.75 5.6 AV DC SLACK OFF - 152 LIME DRILL PIPE 4.562 2.25 30.83 TOT CUM HR 56 %LGS 9.6 DRILL PIPE 3.687 1 2.312 30.29 GAUGE JAR HOURS 75 ES INNER MUD MOTOR HRS 150 I OUTER LOCATION RP DULL CHAR. I CUM HR BHA 40.5 ' LIQ MUD TOTAL LENGTH (FT) 784.48 HYDRAULICS FUEL 3246 GAL ADD (DIESELGAL) TOT WEIGHT (LBS) DEPTH 11640 FT CREW BOAT FUEL ' GAL SOLIDS EQUIPMENT NOZ.AREA .552 IN POT. WATER I GAL SHAKER #1 Derrick 51[DRK 21 1 d Pb PSI TUG FUEL GAL SHAKER #2 Derrick 51'BRDT I HRS BIT HP BARITE SKS DERRICK #1 DRKS 1 HRS H.S.I. HP /IN' FUEL USED 1892 GAL MUD CLEAN CENT 10 HRS JET VEL FT /SEC HEAVY H2O 316 GAL I _ BOP TESTED _ 1 PERSONNEL ON BOARD IMP FORCE WEATHER Misc 10/18/2012 IHEC 2 %Pb DAILY CUM NEXT TEST DUE RI G 124 BOATS WIND 1 Calm MPH MUD 13,899.51 194,049.43 11/1/2012 SERVICE 118 'MN SEAS 13 TEMP DIESEL FUNC. DUE TOTAL 44 MN PRES CONS Clear TOTAL $194,049 MN FORECAST Same 2001 -2010 WellEz Information Management, LLC. All rights reserved ver 5.17.12bg n All Hilcorp Energy Company DAILY DRILLING REPO REPORT NO. LEASE WELL NO. COUNTY / PARISH WELL STATE DATE 19 A028399 & A028997 SCU 44 -33 SRF SCU 44 -33 AK 10/22/2012 RIG AFE NO. AFE AMOUNT DAILY COST CDC CCC TOTAL CUM. COST RIG PHONE Arctic Fox 1212791 4018500 $116,970 $2,159,691 1 $2,159,691 907- 776 -6776 ACTIVITY TYPE: DRLG Drilling ShorTtrp Short Trip DEPTH: MD/TVD PROGRESS / HRS PROPOSED TD LAST SHOE TEST PPG DAYS SINCE SPUD AFE DAYS FOREMAN 11379 1 10208 11379 12328 10/17/2012 14.0 18 Leslie /Greco ACTIVITY SUMMARY AT: 105:30 1HRS 1 , SURVEY: MD ANGLE AZIMUTH TVD SECTION N / S E / W DOG LEG Short Trip to Window 11302 58.12 77.35 10167.16 1801.88 875.1 1803.03 2.39 11244 59.45 77.8 10137.1 1761.32 864.43 1754.59 1.62 11183 60.43 77.94 10106.55 1708.56 853.34 1702.97 1.6 11120 61.35 77.45 10075.9 1653.57 841.61 1649.2 1.28 11056 61.82 78.22 10045,44 1597.32 829.76 1594.17 2.88 TIME LOG ELAPSED ACTIVITY COMMENTS FROM TO TIME 1ple.11',L 6:00 12:00 6.0 Drilling Drill slide /rotary f /10285 t/11063. Pumped sweep @ 11025. Solids increased f/25% to 75% by volume @ B /U. 12:00 16:00 4.0 Drilling Drill slide /rotary f/11063 t/11175. Circ. carbide sample In /Out to gauge hole. Carbide returned to surface 14 bbl under calculated displacement. 16:00 17:00 1.0 Rig Repair Trouble shoot top drive blower motor default 17:00 21:00 4.0 Drilling Rotate and slide F/ 11175 T/ 11295, p/u 180k, s/o 150k, rot, 152, torq 5.1 21:00 21:30 0.5 Rig Repair Change out top drive blower motor power cable 21:30 23:30 2.0 Drilling Rotate and slide F/ 11295 T/11379, , p/u 182k, s/o 152k, rot 154k, gpm 300 Drilling rpm, 50, torq on 5.3, tq off 4 4, wob 6k, _ 23:30 1:00 1.5 Circ & Cond Circulate bottoms up @ 310 gpm, 3260 psi 1:00 1:30 0,5 (drl)Misc Monitor well for 30 min, well flowing @ 7.8 bbl /hr 1:30 2:00 0.5 Rig Repair Repair top drive hydrulic lines on IBOP actuator 2:00 2:30 0,5 (drl)Misc Safety stand down with rig crew on Near miss incident 2:30 5:30 3.0 Circ & Cond Circulate and increase mud weight F/ 11.4 T/11.6. Well flowing @ 2.4 bph 10 12 ,1t y, 5:30 6:00 0.5 Short Trips Begin Short Trip to Window. Pull from 11,380 t/11,000 TOTAL 24.00 LITHOLOGY: Tyonek MAX GAS 1442 B.G. GAS 61 - ICON GAS 1313 7TRIP GAS 1 ! ! Accidents Near -Miss Pollution No Pollution Plan Next 24 Hr Report Attach TIH f /window picking up singles (38 jts) MUD RECORD CASING RECORD PUMP 3.03 BPM TYPE 1EZ -Mud DATA 127 GPM SIZE GRADE WT CONN DEPTH DV ID _ NUMBER 1 2 TIME 23:59 20 ELDE 377 MAKE Garndner Denver Garndner Der DEPTH 10379 10 -3/4 J -55 40.5 10.5 MODEL PZ -8 PZ -8 TEMP 90 7 -5/8 N -80 33.7 TTRE 78 6.64 STROKE 8 8 WEIGHT 11.35 7 -5/8 N -80 26.4 TTRE 4621 6.844 LINER SZ 5.00 5.00 VISC 48.0 7 -5/8 N -80 29.7 TTRE 6111 6.75 SPM 165 PV 23.0 TOP OF LINER @ L GAL/STK 11.96 1.96 YP 26 BIT NO. 13 1SUR .PSI 3300 GELS 6 BHA# SIZE 6.125 API WL 4 MFG. HCC .SLOW PUMP DATA @ 110208 HTHP 9.8 DESCRIPTION OD ID FEET TYPE QD505FHX Pump # PSI 1 PSI 2 PSI 3 Eff CAKE 2 BIT 6.125 1,5 0.9 SERIAL NO. 7028065 1 850 1110 96 SOLIDS 10.5 MOTOR 4.75 3.421 22.07 NOZZLES 5X12 2 1 96 ADJSOL ORIENT SUB 4.75 1.5 2.15 TFA 10.552 SPM for PSI 1/2/3 1 OIL % NM STAB - STRING 6 2.25 5.65 !DEPTH OUT DRILL STRING CAPACITY WTR % 87 NM Drill collar - short 4.75 1 2.25 8.86 1 DEPTH IN +9832 BARRELS _ SD % DRILL PIPE 4.75 3.5 9.17 TOTAL FT. -9832 STROKES 2565 MBT 2.5 NM SUB - STOP P 5 2.25 1.67 HOURS 21 POM ON TRAK -MWD 4 2.25 23.37 AVG ROP pH 9.7 MWD STAB - MOD 5 1.15 2.87 WOB Pm BCPM 5 1.875 10.76 ANN VEL DEPTH PF /MF MWD STAB - MOD 5.125 MEW 2.85 ROT. RPM 320 TORQUE 5.3 Clmud SON 5.312 1.625 14.4 AV DP CSG PICKUP _ 182 Clwtr MWD STOP SUB 5 1.375 1 2.98 AV DP OP HLE ROTATIONAL 154 Cal 32000 NM SUB FILTER 4.75 2.75 1 5.6 AV DC SLACK OFF 152 LIME DRILL PIPE 4.562 2.25 30.83 TOT CUM HR 21 %LGS 10.2 DRILL PIPE 1 3.687 2.312 ! 30.29 GAUGE JAR HOURS 68 ES INNER MUD MOTOR HRS 130 1 OUTER LOCATION 1 RP DULL CHAR. CUM HR BHA 20.9 LIQ MUD 1 TOTAL LENGTH (FT) 784.48 HYDRAULICS FUEL 4923 GAL ADD (DIESELGAL) TOT WEIGHT (LBS) DEPTH 11379 FT CREW BOAT FUEL GAL SOLIDS EQUIPMENT NOZ.AREA .552 IN' POT. WATER GAL SHAKER #1 Derrick 51 DRK 2 ! d Pb 55.5898 PSI TUG FUEL GAL SHAKER #2 Derrick 51 BRDT HRS HHP BIT HP BARITE SKS DERRICK #1 DRKS HRS H.S.I. HP /IN' FUEL USED 1819 GAL MUD CLEAN CENT 0 HRS JET VEL 73.7946 FT /SEC HEAVY H2O 452 GAL BOP TESTED PERSONNEL ON BOARD IMP FORCE WEATHER! Misc 10/18/2012 HEC 2 %Pb 1 DAILY CUM NEXT TEST DUE RIG 24 BOATS WIND Calm MPH MUD 11478.07 180,149,92 11/1/2012 SERVICE 13 _ MN SEAS 22 TEMP DIESEL FUNC. DUE TOTAL 39 MN PRES COND Clear TOTAL $180,150 MN FORECAST _ Same 2001 -2010 WellEz Information Management, LLC. All rights reserved ver 5.17.12bg Hilcorp Energy Company DAILY DRILLING REPO REPORT NO . LEASE WELL NO. COUNTY / PARISH WELL STATE DATE 18 A028399 & A028997 SCU 44 -33 SRF SCU 44 -33 AK 10/21/2012 RIG AFE NO. AFE AMOUNT _ ( DAILY COST j CDC CCC TOTAL CUM. COST RIG PHONE Arctic Fox 1212791 4018500 j $162,603 $2,042,721 $2,042,721 907-776-6776 ACTIVITY TYPE: DRLG Drilling Drilling Drilling DEPTH: MD/TVD __ PROGRESS / HRS PROPOSED TD LAST SHOE TEST PPG DAYS SINCE SPUD AFE DAYS FOREMAN F 1232 10/17/2012 14.0 17 Leslie /Greco 1 ACTIVITY SUMMARY AT: 105:30 IHRS j 'SURVEY: MD ANGLE AZIMUTH TVD SECTION N / S E / W DOG LEG Drilling 10495 j 68.95 79.74 9822.94 1082.7 738.29 1087.75 1.02 10432 68.46 79.29 9800.06 1024.01 727.61 1030.03 0.073 10369 68 79.32 9776.7 965.5 716.75 972.54 3.32 10306 69.98 78.59 9754.11 906.71 705.48 914.82 0.31 10242 7014 78.47 9732.28 846.56 693.52 855.86 5.15 TIME LOG ELAPSED ACTIVITY COMMENTS FROM TO TIME _ I JILU1r L 6:00 12:00 6.0 Drilling Drill slide /rotary f/10200 t/10288. UP 165k, DN 148k, RT 150k, 7.8 bpm, 3225 psi Slow P -rate (2 -4 ft/hr) from 10275 to 10294 (6.2' TVD) Tuffaceous Claystone 12:00 18:30 6.5 Drilling Drill slide /rotary f/10288 1110508. 34 ft/hr ave rop 18:30 19:30 1.0 Rig Repair Troubleshoot Pump Engine problems. Engine repeatedly dying. _ 19:30 21:00 1.5 Drilling Drill slide /rotary f/105081/10561_ 21:00 22:00 , 1.0 Rig Repair Sheared die retainer plates in Grabber. Pull 1 std. Repair TD. _ 22:00 22:30 f 0.5 Ciro & Cond P/u 1 stand, circulate out gas, 166 units @ 310 gpm, 3050 psi 22:30 0:00 1.5 Drilling Drill F/ 10561 T/ 10580, @ 310 gpm, 3050 psi, p/u 170, s/o 153, rot wt 152 10124t tZ. 0:00 6:00 6.0 Drilling Rotate and slide F/10580 T/10825. 41 ft/hr ave rop r TOTAL ( 24.00 LITHOLOGY: Tyonek MAX GAS 11675 IB.G. GAS 94 ICON GAS _J599 1TRIP GAS 1 Accidents None 1 Pollution 1 No pollution Plan Next 24 Hr Report Attach I Drill 6.125 production hole MUD RECORD CASING RECORD PUMP 13.03 BPM TYPE EZ -Mud DATA 1127 GPM SIZE GRADE WT CONN DEPTH DV ID 'NUMBER 11 2 TIME 23:59 20 'VELDEE 377 I MAKE Gamdner Denver Gamdner Der DEPTH 10579 10 -3/4 J -55 40.5 10.5 MODEL PZ -8 PZ -8 TEMP 80 7 -5/8 N -80 33.7 JTTRE, 78 6.64 I STROKE 8 8 WEIGHT 11.35 7 -5/8 N -80 26.4 JTTRE: 4621 6.844 LINER SZ 5.00 5.00 VISC 48.0 7 -5/8 ( N -80 29.7 JTTRE; 6111 6.75 SPM 65 PV 18.0 ( TOP OF LINER @ 1 GAL/STK 1.96 1.96 YP 26 BIT NO. 3 SUR .PSI 3300 •3300_ GELS 6 BHA# SIZE 6125 API WL 4 MFG. HCC SLOW PUMP DATA @ 19826 HTHP 8.8 DESCRIPTION OD ID CM TYPE QD505FHX Pump # PSI 1 PSI 2 PSI 3 1 Eff % CAKE 2 BIT 6.125 ® 0.9 SERIAL NO. 7028065 1 750 I 96 SOLIDS 10.7 MOTOR mu 3.421 22.07 NOZZLES 5X12 2 I 96 ADJSOL ORIENT SUB 4.75 1.5 2.15 TFA 0.552 S _ PM for PSI 1/2/3 30 30 OIL % NM STAB - STRING 6 2.25 5,65 DEPTH OUT DRILL STRING CAPACITY WTR % 87 ;NM Drill collar - sho ■ 4.75 2.25 8.86 DEPTH IN 9832 (BARRELS SD % DRILL PIPE ( 4.75 9.17 TOTAL FT. -9832 ( STROKES 2369 MBT 2.5 NM SUB - STOP 5 ® 1.67 (HOURS 21 POM ON TRAK - MWD 4 2.25 23.37 AVG ROP pH 9.4 MIND STAB - MOD © 1.15 , 2.87 WOB Pm BCPM © 1.875 10.76 ANN VEL r DEPTH PF /MF MWD STAB - MOD 5.125 1.625 2.85 ROT. RPM TORQUE 4.9 Clmud SDN 5.312 1.625 14.4 AV DP CSG PICK UP 170 Clwlr MWD STOP SUB 5 1.375 2.98 AV DP OP HLE ROTATIONAL 152 Cal 29000 NM SUB FILTER 4.75 2.75 5.6 AV DC SLACK OFF 153 LIME _ DRILL PIPE 4.562 ' 2.25 30.83 TOT CUM HR 21 _ %LGS 9.8 DRILL PIPE 1 3.687 ® 30,291GAUGE _ ;JAR HOURS 72 ES 'INNER MUD MOTOR HRS 171 OUTER LOCATION RP DULL CHAR. CUM HR BHA 20.9 r _ I _ ___ LIQ MUD_ TOTAL LENGTH (FT) 784.48 HYDRAULICS 1 FUEL 7057 1GAL ADD (DIESELGAL) TOT WEIGHT (LBS) DEPTH ' IFT ICREW BOAT FUEL _ (GAL SOLIDS EQUIPMENT NOZ.AREA .552 IN' POT. WATER _ GAL SHAKER #1 Derrick FL DRK 2 1 ,d Pb 55.5898 PSI TUG FUEL _ GAL _SHAKER #2 Derrick FL BRDT HRS' HHP BIT HP BARITE _ SKS DERRICK #1 IDRKS (HRS H.S.I. HP /IN' FUEL USED 1136 GAL MUD CLEAN (CENT 0 HRS JET VEL (73.7946 FT /SEC (HEAVY H2O 370 _ GAL BOP TESTED PERSONNEL ON BOARD I IMP FORCE Misc 10/18/2012 HEC 2 %Pb WEATHER DAILY CUM NEXT TEST DUE RIG 24 BOATS WIND Calm MPH MUD 9838,47 168,671.85 11/1/2012 SERVICE X 13 MN SEAS 30 TEMP DIESEL FUNC. DUE TOTAL 39 MN PRES COND Clear TOTAL $168,672 (MN FORECAST Same 2001 -2010 WellEz Information Management, LLC. All rights reserved ver 5.17.12bg n 0 Hilcorp Energy_Company DAILY DRILLING REPO REPORT NO._ LEASE WELL NO. 4 COUNTY / PARISH WELL STATE DATE 17 A028399 & A028997 SCU 44 -33 SRF SCU 44-33 AK 10/20/2012 RIG AFE NO. AFE AMOUNT DAILY COST CDC CCC TOTAL CUM. COST RIG PHONE Arctic Fox 1212791 4018500 j $140,270 $1,879,928 $1,879,928 907 - 776 -6776 ACTIVITY TYPE: DRLG Drilling Drilling 1 Drilling DEPTH: MD/TVD PROGRESS / HRS PROPOSED TD LAST SHOE TEST PPG DAYS SINCE SPUD AFE DAYS FOREMAN 10220 I 9730 388 12328 10/17/2012 14.0 16 Leslie /Greco ACTIVITY SUMMARY AT: 105:30 J HRS 1� SURVEY: MD ANGLE AZIMUTH TVD SECTION 1 N /S E /W ' DOG LEG Drilling ahead @ 10,220 9928 65.93 72.97 9620.76 1 554.29 - 619.13 572.19 6.7 9901 64.15 73.32 9609.37 529.98 612.03 548.76 7.07 9865 61.98 71.83 9593.06 498.16 602.43 518.14 6.4 9831 59.81 71.63 9576.52 468.76 593.12 489.93 6.67 9800 57.81 71.02 9560.47 442.55 584.63 464.81 4.02 TIME LOG I ELAPSED ACTIVITY COMMENTS FROM TO TIME I Of i Iv 6:00 7:00 1.0 (drl)Trips TIH w1 BHA #4 on 4" Dp to 8980'. Well gave 4 bbls over calc displ. on TIH 7:00 9:30 2.5 Circ & Cond CBU w/ 12.5 ppg @ 9100. Began getting gas and fluid cut mud after 96 bbls pumped MW decreased to 11.4 ppg. 2250 units of gas. Chlorides diluted to 20,000 ppm. ! Shut in & circ thru Buster to clear gas influx. 9:30 13:00 3.5 Circ & Cond _ Begin diverting 12.4 ppg to R4R tank. Divert to Pits when wt decreased to 11.9 Recovered 382 bbls of weighted mud in R4R. Circ & cond to treat mud. Treat mud w /circ @ 5 bpm, 1650 psi while getting thru crew change (1st day back) 13:00 gra 1.5 (drl)Trips TIH f/9100. Set down on obstruction @ 9590. Wash and ream thru same. _ _ Continue TIH to 9833. Break circ and record parameters. UP 158k, DN 142k. 14:30 15:30 1.0 Circ & Cond CBU © 7 bpm, 3100 psi. 12.7 ECD. 2250 units of gas @ BU 15:30 0:00 8.5 Directional (TO Slide /Rotary drill for Directional requirements f/9832 1/9998. 7.6 bpm, 3200 psi _ Directional (TO' 330 gpm, 3050 SPP, 3.1 tq off bolt, 4k tq on, wob 8k, 50 rpm, p/u 160, s/o 146k ' Directional (TOirwt 150k, 6.4 hrs on bit t Oli), L 0:00 6:00 6.0 Directional (TO] Rotate and slide F/ 9998 T/10,220, 332 gpm, 3250 SPP. Bit Ave ROP = 26.4 ft/hr TOTAL 24.00 LITHOLOGY: Lower Tyonek - MAX GAS 1340 B.G. GAS 65 ICON GAS 1243 1TRIP GAS 13048 I L Accidents None Pollution No Accidents Plan Next 24 Hr Report Attach Drill 6 .125 production hole MUD RECORD CASING RECORD [ PUMP ' BPM TYPE FEZ -Mud DATA GPM SIZE GRADE WT CONN DEPTH DV ID ' NUMBER - 11 2 , TIME 23:59 20 hIELDEf 377 MAKE Gamdner Denver Gamdner Der DEPTH 9951 10 -3/4 J -55 40.5 10.5 MODEL PZ -8 PZ -8 TEMP 75 7 -5/8 N -80 33.7 JTTRE1 78 6.64 STROKE 8 8 WEIGHT 17.70 7 -5/8 N -80 26.4 JTTRE1 4621 - 6.844 LINER SZ 5.00 15.00 VISC 47.0 7 -5/8 N -80 29.7 JTTRE: 6111 6.75 SPM PV 17.0 TOP OF LINER r --- ' JGAUSTK 1.96 1.96 YP 26 BIT NO. 3 SUR .PSI 3 300 3300 GELS 6 BHA# SIZE 6.125 API WL 4 MFG. HCC SLOW PUMP DATA @ I HTHP 9.6 DESCRIPTION OD ID FEET TYPE QD505FHX Pump # PSI 1 PSI 2 PSI 3 Eff % CAKE 2 BIT 6.125 1.5 0.9 ISERIAL NO. 7028065 1 700 96 SOLIDS 12 MOTOR 4.75 3.421 22,07 NOZZLES 5X12 2 710 96 ADJSOL ORIENT SUB 4.75 1.5 2.15 TFA 0.552 SPM for PSI 1/2/3 I OIL % NM STAB - STRING 6 2.25 5.65 DEPTH OUl DRILL STRING CAPACITY WTR % 85.5 NM Drill collar - short 4.75 2.25 8.86 DEPTH IN 9832 BARRELS SD % DRILL PIPE 4.75 3.5 9.17 TOTAL FT. -9832 STROKES MBT 2.5 NM SUB - STOP 5 2.25 1.67 HOURS POM ON TRAK -MWD 4 2.25 23.37 AVG ROP pH 9.3 MWD STAB - MOD 5 1.15 2.87 WOB Pm BCPM 5 1.875 10.76 ANN VEL DEPTH PF /MF rWD STAB - MOD 5.125 1.625 2.85 ROT. RPM TORQUE 4000 Clmud I SDN 5.312 1.625 14.4 AV DP CSG PICK UP _ 165 Clwtr MWD STOP SUB 5 1.375 2.98 AV DP OP HLE ROTATIONAL 155 Cal 32000 NM SUB FILTER 4.75 2.75 5.6 AV DC j SLACK OFF _ 149 LIME DRILL PIPE 4.562 2.25 30.83 TOT CUM HR _ %LGS 10.9 DRILL PIPE 3.687 2.3 30.29 GAUGE _ _ JAR HOURS 35 ES INNER MUD MOTOR H_ RS 45 OUTER LOCATION RP DULL CHAR. CUM RR BHAr LIQ MUD 1 TOTAL LENGTH (FT) 784.48 I HYDRAULICS FUEL _ 4680 GAL ADD (DIESELGAL) TOT WEIGHT (LBS) _ DEPTH 10220 FT CREW BOAT FUEL GAL SOLIDS EQUIPMENT NOZ.AREA .552 IN POT. WATER GAL SHAKER #1 DRK 2 I d Pb _ PSI TUG FUEL GAL SHAKER #2 BRDT HRS HHP BIT HP BARITE SKS !DERRICK #1 DRKS HRS H.S.I. HP /IN' FUEL USED GAL MUD CLEAN CENT 0 (HRS JET VEL FT /SEC HEAVY H2O 240 ,GAL I BOP TESTED PERSONNEL ON BOARD IMP FORCE WEATHER' Misc 10/18/2012 HEC 12 %Pb DAILY CUM NEXT TEST DUE RIG 24 ■ BOATS WIND Calm MPH MUD 10,126.36 158,833.38 11/1/2012 SERVICE 13 MN SE/VS 20 TEMP DIESEL FUNC. DUE TOTAL 39 MN PRES COND Partly cloudy TOTAL $158,833 _ MN FORECAST Same 2001 -2010 WellEz Information Management, LLC. All rights reserved ver 5.17.12bg ill • Hilcorp Enema Company DAILY DRILLING REPO REPORT NO. LEASE WELL NO. COUNTY / PARISH WELL STATE DATE 16 A028399 & A028997 SCU 44 -33 SRF SCU 44 -33 AK 10/19/2012 _ RIG AFE NO. AFE AMOUNT DAILY COST CDC ' CCC TOTAL CUM. COST RIG PHONE Arct Fox 1212791 4018500 $642,103 $1,733,798 $1,733,798 907 - 776 -6776 ACTIVITY TYPE DRLG 1 Drilling TIH Tripping in Hole DEPTH: MD/TVD PROGRESS / HRS PROPOSED TD LAST SHOE TEST I PPG DAYS SINCE SPUD AFE DAYS FOREMAN 9832 L 9577 12328 10/17/2012 1 14.0 _ 1 Leslie /Greco ACTIVITY SUMMARY AT: 05:30 I HRS I SURVEY: MD ANGLE AZIMUTH TVD SECTION N /S E /W DOGLEG TIH © 7500'. TIME LOG ELAPSED ACTIVITY COMMENTS FROM TO TIME t 011610._ 6:00 9:30 3.5 (drl)Trips BHA: L/D Jars, Std back Flex DCs, PJSM on RA Source. Remove Source. Drain & inspect Motor. Inspect & grade bit. 4,3,WT,A,E,I,LT,Hrs I - ,P•. 9:30 11:30 2.0 Tstg BOP/WH/ Clear rig floor of slip /trip hazards. R/U to test BOP Z 1Z j43t;) I „P 11:30 15:30 4.0 Tstg BOP/WH/ Test BOP and related equipment to 250L /4000H. Test Annular to 250L/2500H. �Dl S1 Hold all tests f /10 min & chart record same. Perform Accumulator precharge test. 15:30 18:00 i 2.5 Tstg BOP/WH/ R/D test equipment & clear floor. Install Wear Bushing (6 5/16" ID) Prep BHA components and stage in Pipe Shed 18:00 21:30 3.5 (drl)Trips M/U BHA # 4: & orient mwd tools 21:30 22:30 1.0 (drl)Trips Shallow test mwd tools, clean rig floor, prep for p/u drill pipe 1 of taliv 22:30 6:00 7.5 (drl)Trips Pick up 50 joints drill pipe. TIH w /BHA #4. I TOTAL 24.00 LITHOLOGY: Lower Tyonek - MAX GAS I B.G. GAS 10 -- ICON GAS S - (TRIP GAS 1 Accidents None Pollution fNo Pollution Plan Next 24 Hr Report Attach I Trip in hole to window, cbu, displace 12.5 mud w/ 11.6, TIH to 9832, drill 6 1/8 hole MUD RECORD CASING RECORD PUMP BPM TYPE EZ -Mud DATA _ GPM SIZE GRADE © CONN DEPTH DV ' ID I 'NUMBER 1 12 TIME 23:59 20 ELDE i 377 i MAKE Garndner Denver 1 Garndner Der DEPTH 9832 10 -3/4 J -55 40.5 10.5 1 MODEL PZ -8 PZ -8 TEMP 75 7 -5/8 N -80 33.7 M' 78 6.64 STROKE 8 8 WEIGHT 12.50 7 -5/8 N -80 26.4 Ola 4621 6.844 LINER SZ 5.00 15.00 VISC 47.0 7 -5/8 N -80 29.7 Ma 6111 6.75 SPM PV 19.0 TOP OF LINER @ GAL/STK 1.96 ' 1.96 YP 26 BIT NO. 3 - F - 1 SUR .PSI 13300 13300 GELS 5 BHA# SIZE 6.125 _ API WL 4 MFG. 'HCC SLOW PUMP DATA @ 18960 HTHP 10.8 DESCRIPTION OD ID FEET 'TYPE QD505FHX Pump # PSI 1 PSI 2 PSI 3 Eff % CAKE 2 BIT 6.125 1.5 0.9 SERIAL NO. 7028065 1 850 960 96 SOLIDS 14.9 MOTOR 4.75 3.421 22.07 NOZZLES 5X12 2 96 ADJSOL ORIENT SUB 4.75 1.5 2.15 TFA 0.552 SPM for PSI 1/2/3 30 40 OIL % NM STAB - STRING 6 2.25 5.65 DEPTH OUT DRILL STRING CAPACITY WTR % 83 NM Drill collar - short 4.75 2.25 8.86 DEPTH IN 9832 BARRELS SD % DRILL PIPE 4.75 3.5 9.17 TOTAL FT. -9832 STROKES 2195 _ MBT 2.5 NM SUB - STOP 5 2.25 1.67 HOURS L POM ON TRAK - MWD 4 1 2.25 23.37 AVG ROP pH 9.4 MWD STAB - MOD 5 1.15 2.87 WOB Pm BCPM 5 1.875 10.76 ANN VEL DEPTH PF /MF MWD STAB - MOD 5.125 1.625 2.85 ROT. RPM TORQUE 0 Clmud SDN 5.312 1.625 14.4 AV DP CSG PICKUP 165 Clwtr I MWD STOP SUB 5 1.375 2.98 AV DP OP HLE i ROTATIONAL 155 Cal 28000 NM SUB FILTER 4.75 2.75 5.6 AV DC SLACK OFF 14 LIME DRILL PIPE 4.562 2.25 30.83 TOT CUM HR %LGS 14.4 DRILL PIPE 3.687 2.312 30.29 GAUGE JAR HOURS 35 ES INNER MUD MOTOR HRS 35 OUTER LOCATION RP I DULL CHAR. CUM HR BHA I LIQ MUD TOTAL LENGTH (FT) 784.48 I HYDRAULICS FUEL 4680 GAL ADD (DIESELGAL) TOT WEIGHT (LBS) I DEPTH 9832 FT CREW BOAT FUEL GAL I SOLIDS EQUIPMENT NOZ.AREA .552 IN' POT. WATER GAL I SHAKER #1 DRK 2 I d Pb PSI TUG FUEL GAL I SHAKER #2 BRDT FIRS HHP BIT HP BARITE _ SKS - DERRICK #1 DRKS HRS H.S.I. HP /IN' FUEL USED _ 1070 GAL MUD CLEAN CENT 0 HRS IJET VEL _ FT /SEC HEAVY H2O 240 _ GAL 1 BOP TESTED 1 PERSONNEL ON BOARD IMP FORCE 1 - - -- WEATHER Misc 10/18/2012 1HEC 2 %Pb I DAILY CUM NEXT TEST DUE RIG 24 BOATS WIND Calm MPH MUD 6190.141 148707.02 11/1/2012 SERVICE 13 iMN SEAS 18 i TEMP DIESEL FUNC. DUE TOTAL 39 MN PRES COND Clear TOTAL $148,707 MN FORECAST _ Same 2001 -2010 WellEz Information Management, LLC. All rights reserved ver 5.17.12bg • Hilcorp Energy Company DAILY DRILLING REPO REPORT NO. LEASE WELL NO. COUNTY / PARISH WELL _ I STATE DA TE 15 A028399 & A028997 SCU 44 -33 SRF SCU 44 -33 AK 10/18/2012 RIG AFE NO. AFE AMOUNT _ DAILY COST CDC CCC TOTAL CUM. COST RIG PHONE Arctic Fox 1212791 4018500 $94,713 $1,065,595 $1,065,595 907 - 776 -6 ACTIVITY TYPE: I DEPTH: MD/TVD PROGRESS ! HRS PROPOSED TD LAST SHOE TEST PPG DAYS SINCE SPUD AFE DAYS FOREMAN 9832 1 9577 12328 1 10/812012 14 (like Leslie /Jimmy Grec ACTIVITY SUMMARY AT: 105:30 !HRS 1 'SURVEY: 1 MD ANGLE AZIMUTH ND SECTION N / S E / W DOG LEG Tripping out of hole _ _J TIME LOG ELAPSED ACTIVITY COMMENTS FROM TO TIME 1 D1 6:00 9:00 3.0 Well Control 11.9 ppg in & out. Shut down pumps. Well flowing. Shut in Well and monitor pressure build. SIDDP = 310 psi, SICP = 290 psi sii- S 9:00 10:00 1.0 Tstg BOP /WH/ Perform F.I.T prior to increasing mud weight. Test MW = 11.9 ppg. ND = 8950. Test pressure = 993 = 14.0 ppg EMW. (good test) 10:00 11:00 1.0 Ciro & Cond Bleed down pressure. Open Well and CBU. Max Gas = 60 units • : 11:00 12:30 1.5 (drl)Trips POOH from 9830 to 9018'. UP 165k, DN 148k. (2.6 bbl under calc displ.) Orient to place bit © 80 deg RT 12:30 16:00 3.5 Well Control Increase MW in suction pit to 12.2 ppg. Displace Well Bore to 9018 with 12.2 ppg iA P IM 16:00 16:30 0.5 Well Control Flow check Well. (still flowing, but dimenished) Increase MW Ill 2.5 ppg 16:30 19:30 3.0 Well Control Displace Well Bore to 12.5 ppg. 3 bpm, 850 psi. 19:30 21:00 1.5 Cut/Slip Drill Lir monitor well, well ok, continue to circ © 3 bb /min & cut drilling line t0(1$10....- 21:00 6:00 9.0 (drl)Trips Monitor well, Trip out of hole TOTAL 24.00 LITHOLOGY: Lower Tyonek - MAX GAS 1= I B.G. GAS [CON GAS - T TRIP GAS Accidents None Pollution No Pollution Plan Next 24 Hr Report Attach _ Test bop's, m/u bha, trip in hole MUD RECORD CASING RECORD `PUMP 1 BPM TYPE I EZ -Mud _ __ j DATA I GPM SIZE GRADE WT CONNI DEPTH DV ID NUMBER 1 2 TIME 23:59 20 VELDEG 377 _ MAKE _ _ Gamdner Denver Gamdner Der DEPTH 9832 10 -3/4 J -55 40.5 10.5 MODEL PZ -8 PZ -8 TEMP 80 7 -5/8 N -80 33.7 TTRE: 78 6.64 !STROKE 8 8 WEIGHT 12.50 7 -5/8 N -80 26.4 TTRE: 4621 1 6.844 ■ LINER SZ 5.00 5.00 VISC 47.0 7 -5/8 N-80 29.7 JTTTRE1 6111 6.75 _ SPM PV 19.0 TOP OF LINER ©I y GAL /STK 1.96 ! 1.96 YP P7 - - BIT NO. 2 1SUR .PSI 13300 13300 GELS 6 BHA# SIZE 6.125 API WL 3 MFG. HCC SLOW PUMP DATA HTHP 10.6 DESCRIPTION OD ID FEET TYPE MX-R18DX Pump # PSI 1 PSI2 PSI3 Eff CAKE 2 BIT 6.125 1.5 0.6 ;SERIAL NO. 5185181 1 I _ 96 SOLIDS 15 MOTOR 4.75 3.421 22.07 NOZZLES ,3x14 2 l 96 ADJSOL ORIENT SUB 4.75 1.5 2.15 TFA 0.451 SPM for PSI 1/2/3 L OIL % NM STAB - STRING 6 2.25 5.65 DEPTH OUf9832 DRILL STRING CAPACITY WTR % 86 DRILL PIPE 4.75 3.5 9.17 DEPTH IN 9035 ; BARRELS SD %u NM SUB - STOP 5 2.25 1.67 TOTAL FT. 797 STROKES 2195 MBT 2.5 ON TRAK - MWD 4 2.25 23.37 HOURS 35 POM MWD STAB - MOD 5 1.15 2.87 AVG ROP 22.7 pH 9.2 BCPM 5 1.875 10.76 WOB Pm MWD STAB - MOD 5.125 1.625 2.85 ANN VEL DEPTH PF /MF SDN 5.312 1.625 I 14.4 ROT. RPM 1325 TORQUE Clmud MWD STOP SUB 5 1.375 2.98 AV DP CSG PICK UP 165 Clwtr SENSOR SUB 4.75 2.5 32.88 AV DP OP HLE ROTATIONAL 155 Cal 26000 NM SUB FILTER 4.75 2.75 5.6 AV DC SLACK OFF 149 LIME DRILL PIPE 3.687 2.312 30.29 TOT CUM HR 35 _ %LGS 14.4 DRILL PIPE 3.687 2.312 30.87 GAUGE !JAR HOURS 35 ES I INNER MUD MOTOR HRS 69 OUTER LOCATION 1 RP DULL CHAR. CUM HR BHA 35 I LIQ MUD J TOTAL LENGTH (FT) 777.37 HYDRAULICS FUEL 5520 GAL ADD (DIESELGAL) TOT WEIGHT (LBS) DEPTH 9832 FT CREW BOAT FUEL GAL SOLIDS EQUIPMENT NOZ.AREA .451 IN' POT. WATER GAL SHAKER #1 DRK 2 j d Pb PSI TUG FUEL GAL SHAKER #2 BRDT HRS HHP BIT HP ,BARITE SKS DERRICK #1 DRKS FIRS H.S.I. HP /IN' 1FUEL USED 1066 GAL MUD CLEAN ;CENT 0 HRS JET VEL 1FT /SEC 'HEAVY H2O 327 GAL I BOP TESTED PERSONNEL ON BOARD � IMP FORCE _ _ WEATHER! Misc 10/8/2012 HEC 2 ' %Pb I DAILY CUM NEXT TEST DUE RIG 24 BOATS WIND Calm 'MPH MUD 15,739.10 142,516.88 10/22/2012 SERVICE 11 MN SEAS 21 'TEMP DIESEL FUNC. DUE TOTAL 37 MN PRES COND clear TOTAL $142,517 I MN , FORECAST Same 2001 -2010 WellEz Information Management, LLC. All rights reserved ver 5.17.12bg n ____•___ Hilcorp Energy Compan r6ti., ! Cti- tvl/,� DAILY DRILLING REPO N LO [ Or) REPORT NO. LEASE WELL NO. 1 COUNTY / PARISH WELL STATE DATE A028399 8997 SCU 44-33 I 14 Z RIG AFE NO2 AFE AMOUNT DAILY COST CDC CCC TOTAL CUM. COST RIG PHONE 3JY P� l I D � j � / 7 Arctic Fox 1212791 4018500 $75,108 $970,882 $970,882 90 776 -6776 ACTIVITY TYPE: _ DEPTH: MD/TVD PROGRESS / HRS PROPOSED TD LAST SHOE TEST PPG DAYS SINCE SPUD AFE DAYS J FOREMAN 9832 I 9577 188 12328 10/8/2012 12.8 13 like Leslie /Jimmy Grec ACTIVITY SUMMARY AT: 05:30 HRS I jSURVEY: MD ANGLE AZIMUTH TVD 1 SECTION N / S E / W DOG LEG Circulating 11.9 KWM, taking returns through Choke @ 3 bpm 9771 57.08 69.94 9544.86 1 418.44 576.46 441.77 4.79 9741 55,79 69.18 9528.28 393.86 567.73 418.35 5.38 9710 54.5 67.9 9510.56 368.93 1 558.43 394.68 4.58 9678 53.08 67.45 9491.66 343.7 548.62 I 370.79 4.15 9 52.14 66.27 9472.23 318.95 j 538.63 1 347.41 i 4.81 TIME LOG ELAPSED ACTIVITY COMMENTS FROM TO TIME _ (11(olm, 6:00 12:00 6,0 Directional (TO Rotate and slide F/9644 T/9751, 315 gpm, 3260 spp, 60 rpm, tq on bolt 3.8k Directional (TO off 3k, wob 15/20k, p/u 153k, s/o 145k, rwt 147k 12:00 17:00 5.0 Directional (TO1 Rotate & slide 89751 89833. UP 155k, DN 145k, ROT 148k, 7.6 bpm = 3300 psi OB. .= - ,!'/ Q (,(, 1 12.5 ppg ECD, Ave ROP = 16.4 fph 17:00 1 18:00 1.0 Circ & Cond CBU. 7.1 bpm = 3050 psi. 5-P ( ''4V 4e0-t-, geP& 7 . 18:00 18:30 0.5 Well Control Monitor Well. Well flowing @ 2.8 bpm (1.4 bbl gain in 30 min) _ � a _ T✓ 18:30 19:30 1.0 Circ & Cond Pump up final survey & CBU. 2090 units of Gas @ BU 1"!-- 19:30 20:30 1.0 Short Trips POOH f/9833 88540. Well took 1.1 bbls over calc. displ on trip out. A tick Y Ory4_: 7P ft 20:30 21:30 1.0 Well Control Monitor Well on the Trip Tank. Well flowing @ 3.4 BPH • ff 21:30 23:00 1.5 Short Trips TIH f/8540 tfTD @ 9833 e' U C , ' 1 'O �`Gt,y u%d4 G 23:00 ' 0:00 1.0 Circ & Cond CBU to clear Gas Influx from Well Bore. 7.5 bpm = 3250 psi. 3572 units @ BU r1 L J� '' 6(s rJ t 0:00 1:00 1.0 Well Control Shut well in & record pressures, 342 on DP, 334 On annulas �f /, 1:00 4:00 3.0 Well Control Increase mud weight in surface volume F/11.6 11.9 >� J 4 _ &Vic_ k- Gt.`Pt. x, 1 z_ z Q � lot i✓ 4:00 DP psi @ 450 psi. Circulate 11.9 ppg KWM @ 3 bpm, ICP 1260 psi. f v - -- Ltf-P IC 61( L" - Kift2( 4 ( - TOTAL 22.00 LITHOLOGY: Lower Tyonek - `1)‘1' MAX GAS 1541 B.G. GAS 60 1CON GAS 1368 1TRIP GAS 13572 I Accidents None Pollution No Pollution Plan Next 24 Hr - Report Attach Moniotor shut in Well pressure. Increase MW as necessary to kill Well MUD RECORD CASING RECORD PUMP _ [7.74 BPM TYPE EZ -Mud DATA 1325 _ GPM _ SIZE GRADE I WT CONN DEPTH DV 1 ID NUMBER 1 2 TIME 23:59 20 ELDEI 377 i MAKE Garndner Denver Garndner Der DEPTH 9832 10 -3/4 J -55 40.5 10.5 MODEL PZ -8 I PZ -8 TEMP 88 7 -5/8 N -80 33.7 TTRE' 78 6.64 STROKE 8 '8 WEIGHT 11.60 7 -5/8 N -80 26.4 TTRE' 4621 I 6.844 LINER SZ 5.00 5.00 VISC 49.0 7 -5/8 N -80 29.7 TTRE' 6111 6.75 1 SPM 83 83 PV 19.0 TOP OF LINER @ � GAL /STK 1.96 _ 1.96 YP 31 _� BIT NO. 12 r SUR .PSI 13300 13300 GELS 7 BHA# SIZE 16.125 API WL 3 MFG. HCC SLOW PUMP DATA @ L HTHP 10.4 DESCRIPTION OD ID FEET TYPE MX -R18DX Pump # PSI 1 PSI 2 PSI 3 Eff CAKE 2 BIT 6.125 1.5 0.6 SERIAL NO. 5185181 1 875 96 SOLIDS 11.6 MOTOR 4.75 3.421 22.07 NOZZLES 3x14 2 850 1060 96 ADJSOL ORIENT SUB 4.75 1.5 2.15 TFA 0.451 SPM for PSI 1/2/3 9742 983 OIL % NM STAB - STRING 6 2.25 5.65 DEPTH OUT 9832 DRILL STRING CAPACITY WTR % 86 DRILL PIPE 4.75 3.5 9.17 !DEPTH IN 9035 BARRELS SD % NM SUB - STOP 5 2.25 , 1.67 TOTAL FT. ,797 STROKES 2304 MBT 2.5 ON TRAK -MWD 4 2.25 23.37 HOURS 135 POM MWD STAB - MOD 5 1.15 2.87 AVG ROP 122.7 _ I pH 9.4 BCPM 5 1.875 10.76 WOB ' 10/15 Pm MWD STAB - MOD 5.125 1.625 2.85 ANN V EL DEPTH PF /MF SDN 5.312 1.625 14.4 ROT. RPM 325 TORQUE 3800 Clmud MWD STOP SUB 5 1.375 2.98 AV DP CSG PICK UP 165 Clwtr SENSOR SUB 4.75 2.5 32.88 AV DP OP HLE ROTATIONAL 155 Cal 31000 NM SUB FILTER 4.75 2.75 5.6 AV DC SLACK OFF 149 LIME DRILL PIPE 3.687 2.312 30.29 TOT CUM HR 35 %LGS 10.6 DRILL PIPE 1 3.687 2.312 , 30.87 GAUGE JAR HOURS 35 ES INNER MUD MOTOR HRS 135 I OUTER LOCATION RP DULL CHAR. ■ CUM HR BHA `35 LIQ MUD _ TOTAL LENGTH (FT) 777.37 HYDRAULICS FUEL 1 1975 'GAL ADD (DIESELGAL) TOT WEIGHT (LBS) DEPTH 9832 FT CREW BOAT FUEL GAL SOLIDS EQUIPMENT NOZ.AREA 1.451 tN' POT. WATER I FGAL SHAKER #1 DRK 2 L d Pb 1555.1 PSI TUG FUEL 1 'GAL SHAKER #2 BRDT HRS HHP BIT I HP BARITE SKS DERRICK #1 DRKS HRS H.S.I. I HP /IN' FUEL USED 11533 GAL ! MUD CLEAN CENT 0 HRS JET VEL X230_665 FT /SEC HEAVY H2O 398 GAL BOP TESTED PERSONNEL ON BOARD IMP FORCE 1 WEATHER Misc 10/8/2012 HEC 1 2 %Pb 1 DAILY CUM NEXT TEST DUE RIG 24 ( BOATS !WIND Calm MPH MUD 12,831.33 128,777.78 10/22/2012 SERVICE 11 MN !SEAS TEMP DIESEL FUNC. DUE TOTAL 37 MN PRES COND Overcast and lite s TOTAL ! $128,778 IMN FORECAST 2001 -2010 WellEz Information Management, LLC. All rights reserved ver 5.17.120g n 4. Hilcorp Energy Company _ DAILY DRILLING REPO REPORT NO. LEASE WELL NO. I COUNTY / PARISH WELL STATE DATE 13 A028399 & A028997 SCU 44-33 SRF SCU 44 -33 AK 10/16/2012 RIG AFE NO. AFE AMOUNT DAILY COST CDC CCC TOTAL CUM. COST RIG PHONE Arctic Fox 1212791 4018500 $68,752 $895,774 $895,774 907 - 776 -6776 ACTIVITY TYPE: DEPTH: MD/TVD PROGRESS / HRS PROPOSED TD LAST SHOE TEST PPG DAYS SINCE SPUD AFE DAYS FOREMAN 9644 I 9472 344 12328 10/8/2012 12 Jimmy Greco ACTIVITY SUMMARY AT Tripping in hole HRS SURVEY: MD ANGLE AZIMUTH ND SECTION N / S E / W DOG LEG Drilling @ 9644 9457 40.59 64.83 9342.96 185.35 483.90 221.40 5.52 9425 38.92 63.93 9318.36 165.64 475.06 202.95 7.79 9396 36.66 63.9 9295.44 148.57 467.24 186.99 8.19 9364 34.19 62.38 9269.37 130.82 458.87 170.44 3.08 1 9332 33.5 61.12 9242.79 113.89 450.44 154.74 5.84 TIME LOG ELAPSED ACTIVITY COMMENTS FROM TO TIME (� 6:00 12:00 6.0 Directional (TO Drilling F/ 9300 T/9361, wob 15/20, rpm 45, tq. on bottom 3k, off bot 2.5k (L 1 Directional (TO' p/u 162k, s/o 150k, spp 3640 psi, 350 gpm, ADT 3.9 HR, ART 1.4 HR, AST 2.5 HR _ 12:00 18:00 6.0 Directional (TO' Rotate and slide F/9361 T/ 9450, - 89' @14.8 ft/hr, p/u 164k, s/o 148k, rtw 155 18:00 0:00 6.0 Directional (TO' Rotate and slide F/9450 T/ 9530', p/u 164k, s/o 148, rtw 152k, 3150 psi on bott Directional (TO 3050 psi off bot, tq on bott 3.4, tq off bott 2.6 ADT 7.9hr ART 1.9 hr, AST 6 hr talltol(i 0:00 6:00 6.0 Directional (TO Rotate and slide F/9530 T/9644, 114'@ 19 ft /hr, 3150 psi, tq on bot. 4k, tq off, 2.5 k, p/u 164k, s/o 148, rtw 152k TOTAL 24.00 LITHOLOGY: Lower Tyonek MAX GAS 11292 B.G. GAS 87 CON GAS 350 TRIP GAS L I Accidents None Pollution Plan Next 24 Hr Report Attach Circulate bottoms up, trip out of hole, test bops, trip in hole, drill ahead MUD RECORD CASING RECORD !PUMP 1 BPM TYPE EZ -Mud DATA I GPM SIZE GRADE © CONN DEPTH DV ID NUMBER 1 2 TIME 23:00 20 _ELIE 377 _ ■ MAKE Garndner Denver Garndner Der DEPTH 9527 10 -3/4 J -55 40.5 El 10.5 MODEL PZ -8 PZ -8 TEMP 98 7 -5/8 N -80 33.7 6.64 STROKE 8 8 WEIGHT 11.60 7 -5/8 N -80 26.4 TTRE' 6.844 ■ LINER SZ 5.00 E 5.00 VISC 47.0 7 -5/8 N -80 29.7 TTRE' 6111 6.75 SPM 65 I PV 16.0 TOP OF LINER @ ■ GAUSTK LL_ YP 30 BIT NO. 2 ;SUR .PSI GELS 8 BHA# SIZE 6.125 API WL 3 MFG. HCC - ;SLOW PUMP DATA @ HTHP 10.2 DESCRIPTION1 OD ID FEET TYPE MX -R18DX Pump # PSI 1 PSI 2 PSI 3 Eff CAKE 2 BIT 6.125 1.5 0.6 SERIAL NO. 5185181 i 1 850 SOLIDS 11.7 MOTOR 4.75 3.421 22.07 NOZZLES 3x14 _ 1 2 ADJSOL ORIENT SUB 4.75 1.5 2.15 TFA 0.451 SPM for PSI 1/2/3 OIL % NM STAB - STRING 6 2.25 5.65 DEPTH OU .9123 ' ' DRILL STRING CAPACITY W TR % 86 DRILL PIPE -1 4.75 3.5 9.17 DEPTH IN -19035 BARRELS SD % NM SUB - STOP 5 2.25 ' 1.67 TOTAL FT. j 88 STROKES 5737 MBT 2.5 ON TRAK -MWD 4 2.25 23.37 HOURS t POM MWD STAB - MOD 5 1.15 2.87 AVG ROP L pH 9.1 BCPM 5 1.875 10.76 WOB Pm MWD STAB - MOD 5.125 1.625 2.85 ANN VEL DEPTH PF /MF SDN 5.312 1.625 14,4 ROT. RPM TORQUE 4k Clmud MWD STOP SUB 5 1.375 2.98 AV DP CSG PICK UP Clwtr SENSOR SUB 4.75 2.5 32.88 AV DP OP HLE ROTATIONAL Cal 30000 NM SUB FILTER 4.75 2.75 5.6 AV DC SLACK OFF 148 LIME DRILL PIPE 3.687 2.312 30.29 TOT CUM HR _ %LGS 10.6 DRILL PIPE 3.687 2.312 30.87 GAUGE JAR HOURS ES INNER MUD MOTOR HRS 40.5 OUTER _ 1 LOCATION -I RP DULL CHAR. CUM HR BHA LIQ MUD I TOTAL LENGTH (FT) 777.37 HYDRAULICS FUEL 3392 GAL ADD (DIESELGAL) TOT WEIGHT (LBS) DEPTH 19644 FT CREW BOAT FUEL GAL SOLIDS EQUIPMENT NOZ.AREA , IN POT. WATER GAL SHAKER #1 DRK 2 I d Pb PSI TUG FUEL GAL SHAKER #2 BRDT HRS HHP BIT HP BARITE SKS DERRICK #1 DRKS FIRS H.S.I. HP /IN' FUEL USED 1526 GAL MUD CLEAN CENT HRS JET VEL _ FT /SEC HEAVY H2O 723 GAL I BOP TESTED PERSONNEL ON BOARD IMP FORCE ' 1 WEATHER Misc 10/8/2012 HEC 1 %Pb DAILY CUM NEXT TEST DUE RIG 22 BOATS WIND MPH MUD 10712.80 97597.91 10/22/2012 SERVICE 6 ,MN ;SEAS TEMP DIESEL FUNC. DUE TOTAL 29 1MN IPRES TOTAL $97,598 !MN FORECAST 2001 -2010 WellEz Information Management, LLC. All rights reserved ver 5.17.12bg • • Hilcorp Energy Company D AILY DRILLING REPORT REPORT NO. LEASE WELL NO. COUNTY/ PARISH WELL STATE DATE 12 A028399 & A028997 SCU 44 -33 SRF SCU 44 -33 AK 10/15/2012 RIG AFE NO. AFE AMOUNT DAILY COST CDC CCC TOTAL CUM. COST RIG PHONE Arctic Fox 1212791 4018500 $67,227 $812,050 $812,050 907- 776 -6776 ACTIVITY TYPE: DEPTH: MD/TVD PROGRESS /HRS PROPOSED TD AST SHOE TEST PPG DAYS SINCE SPUD AFE DAYS FOREMAN 9300 9300 12328 11 Jimmy Greco ACTIVITY SUMMARY AT: Tripping in hole HRS SURVEY: MD ANGLE AZIMUTH TVD SECTION N / S E / W DOG LEG Drilling 6 1/8 production hole TIME LOG ELAPSED ACTIVITY COMMENTS FROM TO TIME ( U1 4.-1.--. 6:00 10:00 4.0 (drl)Trips TIH F/ 777' T/ 8989, fill pipe every 3500', p/u 145k, s/o 115k l 10:00 11:00 1.0 Circ & Cond CBU, @ 250 gpm, 1690 psi, 24% flow, 3294 units gas @ 7200 stks, 11:00 12:00 1.0 Rig Repair Trouble shoot top drive robotics, ( top drive not rotating) 1200 15:00 3.0 Slide Drilling Drill F/ 9035 T /9050' 15:00 18:00 3.0 Rig Repair Trouble shoot top drive, ( top drive not rotating) 18:00 0:00 6.0 Slide Drilling Drill F/ 9050 T/9185, p/u 155k, s/o 144k, rot wt 148k, 300 gpm, 2830 psi Slide Drilling ADT 6.4, AST 6hr, ART o 1010 t( fY 0:00 6:00 6.0 Directional (TO' Rotate and slide F/ 9185 T/ 9300 , on bottom torq 3k, off bot 2k, diff 213 psi 9' Directional (TO' P/u 155K, S/O 144k, rot wt 148k, 2365 psi TOTAL 24.00 LITHOLOGY: Lower Tyonek MAX GAS 140 B.G. GAS 42 CON GAS 96 TRIP GAS 3279 Accidents None Pollution Plan Next 24 Hr Report Attach Drill 6 1/8 production hole MUD RECORD CASING RECORD PUMP BPM TYPE EZ -Mud DATA GPM SIZE GRADE WT CONN DEPTH DV ID NUMBER 1 2 TIME 23:00 20 VELDE[ 377 MAKE Garndner Denver Garndner Der DEPTH 9175 10-3/4 J -55 40,5 10.5 MODEL PZ -8 PZ -8 TEMP 78 7 -5/8 N -80 33.7 JTTRE: 78 6.64 STROKE 8 8 WEIGHT 11.60 7 -5/8 N -80 26.4 JTTRE'. 4621 6.844 LINER SZ 5.00 5.00 VISC 47.0 7 -5/8 N -80 29.7 JTTRE: 6111 6.75 SPM 65 PV 15.0 TOP OF LINER @ GAL/STK YP 30 BIT NO. 2 SUR PSI GELS 9 BHA# SIZE 6.125 API WI_ 3 MFG. HCC SLOW PUMP DATA @ HTHP 10.8 DESCRIPTION OD ID FEET TYPE MX -R18DX Pump# PSI 1 PSI2 PSI3 Eff % CAKE 2 BIT 6.125 1.5 0.6 SERIAL NO. 5185181 1 SOLIDS 11.6 MOTOR 4.75 3.421 22.07 NOZZLES 3x14 2 700 900 ADJSOL ORIENT SUB 4.75 1.5 2.15 TFA 0.451 SPM for PSI 1/2/3 OIL % NM STAB - STRING 6 2.25 5 65 DEPTH OUT 9123 DRILL STRING CAPACITY WTR % 86 DRILL PIPE 4.75 3.5 9.17 DEPTH IN 9035 BARRELS SD % NM SUB - STOP 5 2.25 1.67 TOTAL FT. 88 STROKES 93 MBT 1.5 ON TRAK - MWD 4 2.25 23.37 HOURS POM MWD STAB - MOD 5 1.15 2.87 AVG ROP pH 9.2 BCPM 5 1.875 10.76 WOB Pm MWD STAB - MOD 5.125 1.625 2.85 ANN VEL DEPTH PF /MF SDN 5.312 1.625 14.4 ROT. RPM TORQUE Clmud MWD STOP SUB 5 1.375 2.98 AV DP CSG PICK UP Clwtr SENSOR SUB 4.75 2.5 32.88 AV DP OP H ROTATIONAL Cal 30000 NM SUB FILTER 4.75 2.75 5.6 AV DC SLACK OFF LIME DRILL PIPE 3.687 2.312 30.29 TOT CUM HI %LGS 10.6 DRILL PIPE 3.687 2.312 30.87 GAUGE JAR HOURS ES INNER MUD MOTOR HRS 0 OUTER LOCATION RP DULL CHAR CUM HR BH LIQ MUD TOTAL LENGTH (FT) 777.37 HYDRAULICS FUEL 4817 GAL ADD (DIESELGAL) TOT WEIGHT (LBS) DEPTH 9300 FT CREW BOAT FUEL GAL SOLIDS EQUIPMENT NOZ.AREA IN POT. WATER GAL SHAKER #1 DRK 2 d Pb PSI TUG FUEL GAL SHAKER #2 BRDT HRS HHP BIT HP BARITE SKS DERRICK #1 DRKS HRS H.S.I. HP /IN' FUEL USED 1131 GAL MUD CLEAN CENT HRS JET VEL FT /SEC HEAVY H2O 887 GAL BOP TESTED PERSONNEL ON BOARD IMP FORCE WEATHER Misc 10/08/2012 HEC 1 %Pb DAILY CUM NEXT TEST DUE RIG 22 BOATS WIND MPH MUD 10712,80 97597.91 10/22/2012 SERVICE 6 MN SEAS 37 TEMP DIESEL FUNC. DUE TOTAL 29 MN PRES CDND Rain TOTAL $97,598 MN FORECAST Rain 2001 -2010 WellEz Information Management, LLC. All rights reserved ver 5.17.12bg 0 • Hilcorp Energy Company D AILY DRILLING REPORT REPORT NO. LEASE WELL NO. COUNTY / PARISH WELL STATE DATE 11 A028399 & A028997 SCU 44 -33 SRF SCU 44 -33 AK 10/14/2012 RIG AFE NO. AFE AMOUNT DAILY COST CDC CCC TOTAL CUM. COST RIG PHONE Arctic Fox 1212791 4018500 $78,988 $744,823 $744,823 907- 776 -6776 ACTIVITY TYPE: DEPTH: MD/TVD PROGRESS I HRS PROPOSED TD -AST SHOE TEST PPG DAYS SINCE SPUD AFE DAYS FOREMAN 12328 10 Jimmy Greco ACTIVITY SUMMARY AT: Tripping in hole HRS SURVEY: MD ANGLE AZIMUTH TVD SECTION N / S 01W DOGLEG tripping in hole TIME LOG ELAPSED ACTIVITY COMMENTS FROM TO TIME fy . 6:00 10:00 4.0 Circ & Cond Circulate and increase mud weight Fl 11.3 T/ 11.6, 1869 units gas @ bottoms up �l 10:00 11:00 1.0 Well Control Monitor well on trip tank, well flowing 1.8 bbl /hr 11:00 12:30 1.5 Circ & Cond Circulate and condution mud, insure mud is blanced @ 11.6 j 1¢111 Z. -- ---..,..-r 12:30 14:00 1.5 Tstg BOP/WH/l Perform FIT test @ 13ppg EMW, PSI up 10 652 psi, pressure bleed down to 554 c& Tstg BOP/WH /l psi = 12.8'EMW, rig down test equipment 14:00 14:30 0.5 Circ & Cond Circulate bottoms up, @ 310 gpm, 1500 psi, 770 units gas @ 5100 stks, Circ & Cond monitor well, well flowing @ 1 1/2 bbl hr 14:30 18:00 3,5 (drl)Trips Trip out of hole F/ 8998 T/ 5000', hole taking proper displacement, (drl)Trips when pulling pipe, monitor well F/ 30 min. well flowing 1/2 bbl hr, blow down TD 18:00 20:30 2.5 (drl)Trips Continue tripping out T/ 631' monitor well, well flowing 2 bbl /hr ' 20:30 22:30 2.0 (drl)Trips Continue tripping out of hole Ild milling assembly, sing mills in gauge, _._____, �I 5� S(.0 ZZ3t 4 '1' &I 1 2 window mill 6.25 22:30 23:00 0.5 (drl)Trips Install wear bushing, clean rig floor 23:00 1:30 2.5 (dri)Tnps Pjsm, bring drlg tools to rig floor, pick up bha, oirent mwd tools 1:30 3:00 1.5 (drl)Trips Down load mwd tools, m/u Slb sensor ^ 3:00 3:30 0.5 (drl)Trips PJSM, w/ all hands, load nuke sources in tools 4.___ IJ C� n e9 , 656- 1 30 f& �j 10141(,- 3:30 6:00 2.5 (drl)Trips Trip in hole LAS �i� l 0 �1,LA lu� i Ykx TOTAL 24.00 LITHOLOGY: MAX GAS B.G. GAS 1 CON GAS TRIP GAS Accidents None Pollution Plan Next 24 Hr Report Attach Trip in hole to 9035, drill ahead MUD RECORD CASING RECORD PUMP BPM TYPE EZ -Mud DATA GPM SIZE GRADE WT CONN DEPTH DV ID NUMBER 1 2 TIME 23:00 MAKE Garndner Denver Garndner Der DEPTH 9015 MODEL PZ -8 PZ -8 TEMP 68 STROKE 8 8 WEIGHT 1160 LINER SZ 5.00 5.00 VISC 47.0 SPM 65 PV 11.0 TOP OF LINER @ GAL/STK YP Y4 BIT NO. 1 SUR PSI GELS 9 BHA# SIZE 6 API WWL 1 MFG. SLOW PUMP DATA @ HTHP 11.4 DESCRIPTION OD ID FEET TYPE Pump # PSI 1 PSI 2 PSI 3 Eff CAKE 2 Bottom trip anchor 6 3.25 SERIAL NO. T72Xy 1 I SOLIDS 11.6 Gen 11 Whip stock 6 14.6 NOZZLES 3x16 2 525 800 ADJSOL Window Mill 6.625 1.562 1.5 TFA SPM for PSI 1/2/3 OIL % Lower string mill 6.375 1.5 5.5 DEPTH OUT 9123 DRILL STRING CAPACITY WTR % 86 Flex Jnt 3.5 1.5 6.55 DEPTH IN BARRELS SD % 0.1 Upper String Mill 6.625 2.687 5.85 TOTAL FT. 9123 STROKES MBT 1.5 HWDP 4 2.25 30.41 HOURS POM Float sub 4.688 2.25 2.44 AVG ROP pH 9.4 MWD 4.75 28.75 WOB Pm UBHO Sub 4.812 3.25 3.13 ANN VEL DEPTH PF /MF xo 4.75 2.25 2.39 ROT. RPM TORQUE Clmud HWDP 4 2.562 544.91 AV DP CSG PICK UP Clwtr Drill pipe 4 8385.8 AV DP OP H ROTATIONAL Cal 31000 AV DC SLACK OFF LIME TOT CUM HI %LGS 10.6 GAUGE JAR HOURS ES INNER MUD MOTOR HRS OUTER LOCATION RP DULL CHAR CUM HR BH LIQ MUD TOTAL LENGTH (FT) 649.28 HYDRAULICS FUEL 5778 GAL ADD (DIESELGAL) TOT WEIGHT (LBS) DEPTH FT CREW BOAT FUEL GAL SOLIDS EQUIPMENT NOZ.AREA IW POT. WATER GAL SHAKER #1 DRK 2 d Pb PSI TUG FUEL GAL SHAKER #2 BRDT HRS HHP BIT HP BARITE SKS 1� DERRICK #1 DRKS HRS H.S.I. HP /IN' FUEL USED 1035 GAL MUD CLEAN CENT HRS JET VEL FT /SEC HEAVY H2O 789 GAL BOP TESTED PERSONNEL ON BOARD IMP FORCE WEATHER Misc 10/08/2012 HEC 1 %Pb DAILY CUM NEXT TEST DUE RIG 22 BOATS WIND 8 MPH MUD 20566.96 86885.11 10/22/2012 SERVICE 6 MN SEAS 34 TEMP DIESEL FUNC. DUE TOTAL 29 MN PRES COND cloudy TOTAL $86,885 MN FORECAST 2001 -2010 WellEz Information Management, LLC. All rights reserved ver 5.17.12bg • • Hilcorp Energy Company D AILY DRILLING REPORT REPORT NO. LEASE WELL NO. COUNTY/ PARISH WELL STATE DATE 10 A028399 & A028997 SCU 44 -33 SRF SCU 44 -33 AK 10/13/2012 RIG AFE NO. AFE AMOUNT DAILY COST CDC CCC TOTAL CUM. COST RIG PHONE Arctic Fox 1212791 4018500 $109,362 $665,836 $665,836 907 - 776 -6776 ACTIVITY TYPE: DEPTH: MD/TVD PROGRESS / HRS PROPOSED TD AST SHOE TEST PPG DAYS SINCE SPUD AFE DAYS FOREMAN 12328 9 Jimmy Greco ACTIVITY SUMMARY AT: Circulating 11.2 HRS SURVEY: MD ANGLE AZIMUTH TVD SECTION N /S E /W DOG LEG TIME LOG ELAPSED ACTIVITY COMMENTS 13.94- Li-Se- - FROM TO TIME r , a42,117..._ 6:00 7:30 1,5 Well Control Circulate 10.7 mud around @ 210 gpm @ 1130 psi 21% flow max gas =424 units, V ' t � l Well Control monitor well, well flowing, shut in and record pressure, SIDP = 580, SICP = 520 7:30 10:30 3.0 Well Control Circulate and increase mud wt F/ 10.7 T/ 10.9, @ 168gpm ICP 730, FCP 760 psi �/�M Well Control max gas units 1173 units, monitor well, well flowing, shut in and record psi �� brl �, �`� - ' ! (1 504 Well Control SIDPP = 500 - SICP =450, decision made to drill ahead 10:30 16:00 5.5 Drilling Mill /drill F/ 9015 T/ 9035, @ 250 gpm, 13 (U off bot Si, p 1420 on bot psi, 100 Drilling rpm, off bot torq 2.5K, on bolt, torq. 5.5, wob 14/15, flow 23% out max gas t Drilling @ bottoms up = 1292 units 16:00 19:30 3.5 Drilling Monitor well, well flowing @ 2.8 bbls /hr, CBU @ 300 gpm, 1400 psi while 7� S} polishing window, w/ 80 rpm, pass through window w/ no pump, or rotation, ok 'l 19:30 21:30 2.0 Tstg BOPWH/ L/D single, monitor well on trip tank, rig up test pump and perform FIT lest W6- Tstg BOP/WH /t EMW 12 ppq with 10.0 ppq test mud, @ 8963' tvd, @ 512 psi, chart test 21:30 23:30 2.0 Circ & Cond Circulate and increase mud weight F/ 10.9 T/ 11.1 ppg, 2257 units gas @ bot, ups 23:30 0:00 0.5 Well Control Monitor well on trip tank 101131,,,_ 0:00 6:00 6.0 Circ & Cond circulate amd increase mud weight F/ 11.1 to 11.3, gas units @ bottoms up = 1639 TOTAL 24.00 LITHOLOGY: MAX GAS 1639 B.G. GAS 70 CON GAS 216 TRIP GAS Accidents None Pollution Plan Next 24 Hr Report Attach MUD RECORD CASING RECORD PUMP 8PM TYPE EZ -Mud DATA GPM SIZE GRADE WT CONN DEPTH DV ID NUMBER 1 2 TIME 23:00 MAKE Garndner Denver Garndner Der DEPTH 9015 MODEL PZ -8 PZ -8 TEMP 60 STROKE 8 8 WEIGHT 11.10 LINER SZ 5.00 5.00 VISC 64.0 SPM PV 12.0 TOP OF LINER @ GAL/STK YP 25 BIT NO. 1 SUR PSI GELS 5 BHA# SIZE 6 API WL 1 MFG. SLOW PUMP DATA @ HTHP 11.8 DESCRIPTION OD ID FEET TYPE Pump # PSI 1 PSI 2 PSI3 Eff % CAKE 2 Bottom trip anchor 6 3.25 SERIAL NO. T72Xy 1 SOLIDS 9.4 Gen 11 Whip stock 6 14.6 NOZZLES 3x16 2 ADJSOL Window Mill 6.625 1.562 1.5 TFA SPM for PSI 1/2/3 OIL % Lower string mill 6.375 1.5 5.5 DEPTH OUT 9123 DRILL STRING CAPACITY WTR % 88 Flex Jnt 3.5 1.5 6.55 DEPTH IN BARRELS SD % 0.1 Upper String Mill 6.625 2.687 5.85 TOTAL FT. 9123 STROKES MBT 1.5 HWDP 4 2.25 30.41 HOURS POM Float sub 4.688 2.25 2.44 AVG ROP pH 9.4 MWD 4.75 28.75 WOB Pm UBHO Sub 4.812 3.25 3.13 ANN VEL DEPTH PF /MF xo 4.75 2.25 2.39 ROT. RPM TORQUE Clmud HWDP 4 2.562 544.91 AV DP CSG PICK UP Clwtr Drill pipe 4 8385 8 AV DP OP H ROTATIONAL Cal 33000 AV DC SLACK OFF LIME TOT CUM HI %LGS 8.9 GAUGE JAR HOURS ES INNER MUD MOTOR HRS OUTER LOCATION RP DULL CHAR CUM HR BH LIQ MUD TOTAL LENGTH (FT) 649.28 HYDRAULICS FUEL 2388 GAL ADD (DIESELGAL) TOT WEIGHT (LBS) DEPTH FT CREW BOAT FUEL GAL SOLIDS EQUIPMENT NOZ.AREA IN POT. WATER GAL SHAKER #1 DRK 2 d Pb PSI TUG FUEL GAL SHAKER #2 BRDT HRS HHP BIT HP BARITE SKS DERRICK #1 DRKS HRS H.S.I. HP /IN' FUEL USED 1000 GAL MUD CLEAN CENT HRS JET VEL FT /SEC HEAVY H2O 717 GAL BOP TESTED PERSONNEL ON BOARD IMP FORCE WEATHER Misc 10/08/2012 HEC 1 %Pb DAILY CUM NEXT TEST DUE RIG 22 BOATS WIND MPH MUD 30695.50 66318.15 10/22/2012 SERVICE 6 MN SEAS 31 TEMP DIESEL FUNC. DUE TOTAL 29 MN PRES COND Clear TOTAL $66,318 MN FORECAST 2001 -2010 WellEz Information Management, LLC. All rights reserved ver 5.17.12bg • • Hilcorp Energy Company D AILY DRILLING REPORT REPORT NO. LEASE WELL NO. COUNTY/ PARISH WELL STATE DATE 9 A028399 & A028997 SCU 44 -33 SRF SCU 44 -33 AK 10/12/2012 RIG AFE NO. WE AMOUNT DAILY COST CDC CCC TOTAL CUM. COST RIG PHONE Arctic Fox 1212791 4018500 $49,886 $556,473 $556,473 907- 776 -6776 ACTIVITY TYPE: DEPTH: MD/TVD PROGRESS / HRS PROPOSED TD AST SHOE TEST PPG DAYS SINCE SPUD AFE DAYS FOREMAN 12328 8 Jimmy Greco ACTIVITY SUMMARY AT: 06:00 tripping c HRS SURVEY: MD ANGLE AZIMUTH ND SECTION N / S 61W DOGLEG Circulating 10.7 kill weight mud @ 9015' TIME LOG ELAPSED ACTIVITY COMMENTS FROM TO TIME 10 lid 6:00 10:00 4.0 (drl)Trips Trip in hole with whip stock to stand 134 10:00 11:00 1.0 Directional (TO' M/U top drive on std 134, break circ. orient whip stock @ 80 deg, tag CIBP r ,..�, Directional (TO' @ 9019', slack off 20K engauge anchor, P/U 6K to confirm set, slack gefet. Directional (TO' 40K and shear bolt, whipstock set @ 9001.15 Z' (.'v rf r Le 11:00 13:00 2.0 Circ & Cond Displace well W/ 352 bbls 9.5 EZ -mud, get drilling perimiters, p/u 150, s /o148, 'O p 13:00 19:00 6.0 Directional (TO' Mill window (/9001 T/ 9015, <------..„ o - ) rg 19:00 22:00 3.0 Well Control tronif011treil , weltftowing, @ 8/9 bbl /hr,shut well in, Shut in psi 1270 on csg r Well Control 1220 on drill pipe 7476;t mud system up o 1 .2, intial gain = 10 bbls � V i4: --V1/4/ 04 w 22:00 2:30 4.5 Well Control Pump 10.2 kill weight mud @ 3 bbl /min, ICP 1000 psi, continue pumping j_ Well Control pumping kill rate F/ 7800 stks, 30bbl gain while pumping kill wt fluid, `{.' Well Control continue pump until 10.2 ppg @ surface, monitor well through gas buster ce a1-, Well Control slight flow, open well and monitor well, well flowing, shut well in and record 10,17 \ / t Well Control pressure, 890 psi on drill pipe, 840 on csg, decission made to increase mud wt v Well Control to 10.7 build weight in mud pits to 10.7 (01 2:30 6:00 3.5 Well Control Pump 10.7 kill weight mud through choke, following pump schedual @ 3 bbl min TOTAL 24.00 LITHOLOGY: MAX GAS B.G. GAS CON GAS TRIP GAS Accidents None Pollution Plan Next 24 Hr Report Attach Drill 20' new hole, FIT test, trip out for drilling assembly MUD RECORD CASING RECORD PUMP BPM TYPE EZ -Mud DATA GPM SIZE GRADE WT CONN DEPTH DV ID NUMBER 1 2 TIME 23:00 MAKE Garndner Denver Garndner Der DEPTH 9015 MODEL PZ -8 PZ -8 TEMP 60 STROKE 8 8 WEIGHT 10.70 LINER SZ 5.00 5.00 VISC 60.0 SPM PV 9.0 TOP OF LINER @ GAL/STK YP 21 BIT NO. 1 SUR PSI GELS 6 BHA# SIZE 6 WI WL 1 MFG. SLOW PUMP DATA @ HTHP 11.8 DESCRIPTION OD ID FEET TYPE Pump# PSI 1 PSI2 PSI 3 Eff % CAKE 2 Bottom trip anchor 6 3.25 SERIAL NO. T72Xy 1 SOLIDS 6.3 Gen 11 Whip stock 6 14.6 NOZZLES 3x16 2 ADJSOL Window Mill 6.625 1.562 1.5 TFA SPM for PSI 1/2/3 OIL % Lower string mill 6.375 1.5 5.5 DEPTH OUT 9123 DRILL STRING CAPACITY WTR % 91 Flex Jnt 3.5 1.5 6.55 DEPTH IN BARRELS SD % 0.1 Upper String Mill 6.625 2.687 5.85 TOTAL FT. 9123 STROKES MBT 1.5 HWDP 4 2.25 30.41 HOURS POM Float sub 4,688 2.25 2.44 AVG ROP pH 9.2 MWD 4.75 28.75 WOB Pm UBHO Sub 4.812 3.25 3.13 ANN VEL DEPTH PF /MF xo 4.75 2.25 2.39 ROT. RPM TORQUE Clmud HWDP 4 2.562 544.91 AV DP CSG PICK UP Clwtr AV DP OP H ROTATIONAL Cal 31000 AV DC SLACK OFF LIME TOT CUM HI %LGS 5.3 GAUGE JAR HOURS ES INNER MUD MOTOR HRS OUTER LOCATION RP DULL CHAR CUM HR BH LIQ MUD TOTAL LENGTH (FT) 649.28 HYDRAULICS FUEL 3298 GAL ADD (DIESELGAL) TOT WEIGHT (LBS) DEPTH FT CREW BOAT FUEL GAL SOLIDS EQUIPMENT NOZ.AREA IN POT. WATER GAL SHAKER #1 DRK 2 d Pb PSI TUG FUEL GAL SHAKER #2 BRDT HRS HHP BIT HP BARITE SKS DERRICK #1 DRKS HRS H.S.I. HP /IN' FUEL USED 808 GAL MUD CLEAN CENT HRS JET VEL FT/SEC HEAVY H2O 821 GAL BOP TESTED PERSONNEL ON BOARD IMP FORCE WEATHER Misc 10/08/2012 HEC 1 %Pb DAILY CUM NEXT TEST DUE RIG 22 BOATS WIND MPH MUD 9691.00 35622.65 10/22/2012 SERVICE 6 MN SEAS TEMP DIESEL FUNC. DUE TOTAL 29 MN PRES COND TOTAL $35,623 MN FORECAST 2001 -2010 WellEz Information Management, LLC. All rights reserved ver 5.17.12bq • • Hilcorp Energy Company D AILY DRILLING REPORT REPORT NO. LEASE WELL NO. COUNTY / PARISH WELL STATE DATE 8 A028399 & A028997 SCU 44 -33 SRF SCU 44 -33 AK 10/11/2012 RIG AFE NO. AFE AMOUNT DAILY COST CDC CCC TOTAL CUM. COST RIG PHONE Arctic Fox 1212791 4018500 $58,166 $506,587 $506,587 907 - 776 -6776 ACTIVITY TYPE: DEPTH: MD/TVD PROGRESS / HRS PROPOSED TD -AST SHOE TEST PPG DAYS SINCE SPUD AFE DAYS FOREMAN 12328 7 Jimmy Greco ACTIVITY SUMMARY AT: 06:00 tripping c HRS SURVEY: MD ANGLE AZIMUTH TVD SECTION N / S 61W DOGLEG Tripping in hole with whip stock assembly @ 4289' TIME LOG ELAPSED ACTIVITY COMMENTS FROM TO TIME (6( tOtto- 6:00 8:30 2.5 (drl)Trips Trip out of hole 8:30 10:30 2.0 Other Wait on Pollard w /line 10:30 14:30 4.0 UnPlanned Rig and run collar locatorm gamma and CIBP tools, set CIBP @ 9038', bolt strippe UnPlanned out of lower plate on CIBP instead of shearing 14:30 17:30 3.0 Tstg BOPNVH /l test casing @ 2100 psi, test good 17:30 19:30 2.0 UnPlanned Wait on CIBP and E - Line unit, make up upper & lower string mills & mwd 19:30 20:30 1.0 UnPlanned PJSM w/ E _ line crew and rig up e- line 20:30 23:00 2.5 UnPlanned RIH with CIBP and set bridge plug @ 9034' wlm, pooh and rig down wire line 23:00 23:30 0.5 (dri)Trips P/U MWD, UBHO, xo and shallow test mwd @ 410 gpm 23:30 0:00 0.5 (drl)Trips Pick up upper and lower string mill, and whip stock 0:00 2:00 2.0 (drl)Trips RIH w/ whip stock assembly, & mills, mwd tools and orient tools to whip stock 1 bIy it y 2:00 6:00 4.0 (drl)Trips Trip in hole w/ whip stock on drill pipe from derrick @ 2 min per stand TOTAL 24.00 LITHOLOGY: MAX GAS B.G. GAS CON GAS TRIP GAS Accidents None Pollution Plan Next 24 Hr Report Attach Trip in hole to 9034, set whip stock, mill out window in casing MUD RECORD CASING RECORD PUMP BPM TYPE EZ -Mud DATA GPM SIZE GRADE WT CONN DEPTH DV ID NUMBER 1 2 TIME 23:00 MAKE Garndner Denver Garndner Der DEPTH 9000 MODEL PZ -8 PZ -8 TEMP 60 STROKE 8 8 WEIGHT 9.70 LINER SZ 5.00 5.00 VISC 60.0 SPM PV 9.0 TOP OF LINER @ GAUSTK VP 19 BIT NO. 1 SUR PSI GELS 6 BHA# SIZE 6 API I/,ti 1 MFG. SLOW PUMP DATA @ HTHP 11,4 DESCRIPTION OD ID FEET TYPE Pump # PSI1 PSI 2 PSI 3 Eff CAKE 2 Bit 6 0.6 SERIAL NO. T72Xy 1 SOLIDS 5.1 Bit Sub 4.75 2.96 NOZZLES 3x16 2 ADJSOL String Mill 2 5.11 TFA SPM for PSI 1/2/3 OIL % Flex Jnt 3.5 1.5 6.55 DEPTH OUT 9123 DRILL STRING CAPACITY WTR % String Mill 6 2 5.85 DEPTH IN BARRELS SD % 0.1 Cross Over 5 2.5 TOTAL FT. 9123 STROKES MBT 2.5 HWDP 4 2 HOURS POM Drill Pipe 4 2.25 8555.4 AVG ROP pH 8.6 WOB Pm ANN VEL DEPTH PF /MF ROT. RPM TORQUE Clmud AV DP CSG PICK UP Clwtr AV DP OP H ROTATIONAL Cal 33000 AV DC SLACK OFF LIME TOT CUM HI %LGS 6.4 GAUGE JAR HOURS ES INNER MUD MOTOR HRS OUTER LOCATION RP DULL CHAR CUM HR BH LIQ MUD TOTAL LENGTH (Fr) 567,68 HYDRAULICS FUEL 4009 GAL ADD (DIESELGAL) TOT WEIGHT (LBS) DEPTH FT CREW BOAT FUEL GAL SOLIDS EQUIPMENT NOZ.AREA IN' POT. WATER GAL SHAKER #1 DRK 2 d Pb PSI TUG FUEL GAL SHAKER #2 BRDT HRS HHP BIT HP BARITE SKS DERRICK #1 DRKS FIRS H.S.I. HP /IN' FUEL USED 630 GAL MUD CLEAN CENT HRS JET VEL FT /SEC HEAVY H2O 864 GAL BOP TESTED PERSONNEL ON BOARD IMP FORCE WEATHER Misc 10/08/2012 HEC 1 %Pb DAILY CUM NEXT TEST DUE RIG 22 BOATS WIND MPH MUD 4901.13 25531.55 10/22/2012 SERVICE 6 MN SEAS TEMP DIESEL FUNC. DUE TOTAL 29 MN PRES COND TOTAL $25,532 MN FORECAST 2001 -2010 WellEz Information Management, LLC. All rights reserved ver 5.17.12bq 3 • • Hilcorp Energy Company D AILY DRILLING REPORT REPORT NO. LEASE WELL NO. COUNTY/ PARISH WELL STATE DATE 7 A028399 & A028997 SCU 44-33 SRF SCU 44 -33 AK 10/10/2012 RIG AFE NO. AFE AMOUNT DAILY COST CDC CCC TOTAL CUM. COST RIG PHONE Arctic Fox 1212791 4018500 $68,325 $448,421 $448,421 907- 776 -6776 ACTIVITY TYPE: DRLG Drilling TOH Tripping out of Hole DEPTH: MD/TVD PROGRESS / FIRS PROPOSED TD .AST SHOE TEST PPG DAYS SINCE SPUD AFE DAYS FOREMAN 12328 6 Jimmy Greco ACTIVITY SUMMARY AT: 06:00 tripping c HRS SURVEY: MD ANGLE AZIMUTH TVD SECTION N /S E /W DOG LEG tripping out of hole @ 1750' TIME LOG ELAPSED ACTIVITY COMMENTS FROM TO TIME 10 1 61 .11 2 - - 6:00 6:30 0.5 Other Fill hole with 20 bbls w/ produce water 6:30 17:30 11.0 (drl)Trips Pick up singles & RIH V 700', work mill through spot @ 700' no drag, continue (drl)Trips picking up pipe to 9123' 17:30 21:30 4.0 Circ & Gond circulate bottoms up, pump sweep, circulate sweep out @ 400 GPM, 2270 psi Circ & Cond rotate and work pipe while circulating 21:30 22:00 0.5 (drl)Trips Monitor well 22:00 22:30 0.5 Circ & Coed Circulate and blance out fluid 22:30 23:30 1.0 (drl)Trips Trip out of hole standing back 23:30 0:00 0.5 Rig Service Service rig and topdrive ti: ipbz.. 0:00 6:00 6.0 (drl)Trips Trip out of hole @ 1750' TOTAL 24.00 LITHOLOGY: MAX GAS B.G. GAS CON GAS TRIP GAS Accidents None Pollution Plan Next 24 Hr Report Attach Rig up E- line, trip in hole w/ cibp and set @ 9030', rig down wire line, make up bha and w MUD RECORD CASING RECORD PUMP BPM TYPE DATA GPM SIZE GRADE WT CONN DEPTH DV ID NUMBER 1 2 TIME 23:00 MAKE Garndner Denver Garndner Der DEPTH 9000 MODEL PZ -8 PZ -8 TEMP STROKE 8 8 WEIGHT 9.70 LINER SZ 5.00 5.00 VISC 50.0 SPM PV 13.0 TOP OF LINER @ GAL /STK YP 18 BIT NO. 1 SUR PSI GELS 6 BHA# SIZE 6 API WL 1 MFG. SLOW PUMP DATA @ HTHP 12.4 DESCRIPTION OD ID FEET TYPE Pump # PSI 1 PSI2 PSI3 Eff CAKE 2 Bit 6 0.6 SERIAL NO. T72Xy 1 SOLIDS 0.3 Bit Sub 4.75 2.96 NOZZLES 3x16 2 ADJSOL String Mill 2 5.11 TFA SPM for PSI 1/2/3 OIL % Flex Jnt 3.5 1.5 6.55 DEPTH OUT 9123 DRILL STRING CAPACITY WTR % String Mill 6 2 5.85 DEPTH IN BARRELS SD % 0.1 Cross Over 5 2.5 TOTAL FT. 9123 STROKES MBT HWDP 4 2 HOURS POM Drill Pipe 4 2.25 8555.4 AVG ROP pH WOB Pm ANN VEL DEPTH PF /MF ROT. RPM TORQUE Clmud AV DP CSG PICK UP Clwtr AV DP OP H ROTATIONAL Cal 35000 AV DC SLACK OFF LIME TOT CUM HI %LGS 6.4 GAUGE JAR HOURS ES INNER MUD MOTOR HRS OUTER LOCATION RP DULL CHAR CUM HR BH LIQ MUD TOTAL LENGTH (FT) 567.68 HYDRAULICS FUEL 4462 GAL ADD (DIESELGAL) TOT WEIGHT (LBS) DEPTH FT CREW BOAT FUEL GAL SOLIDS EQUIPMENT NOZ.AREA IN POT. WATER GAL SHAKER #1 DRK 2 d Pb PSI TUG FUEL GAL SHAKER #2 BRDT HRS HHP BIT HP BARITE SKS DERRICK #1 DRKS HRS H.S.I. HP /IN' FUEL USED 626 GAL MUD CLEAN CENT HRS JET VEL FT /SEC HEAVY H2O 853 GAL BOP TESTED PERSONNEL ON BOARD IMP FORCE WEATHER Misc 10/08/2012 NEC 1 %Pb DAILY CUM NEXT TEST DUE RIG 22 BOATS WIND 5 MPH MUD 7,290.42 21,030.42 10/22/2012 SERVICE 6 MN SEAS 36 TEMP DIESEL FUNC. DUE TOTAL 29 MN PRES COND clear TOTAL $21,030 MN FORECAST 2001 -2010 WellEz Information Management, LLC. All rights reserved ver 5.17.12bq • • ; 1 1 ( t AGENDA FOR INFORMAL HEARING WITH AOGCC (20 AAC 25.535(c) and (d)) 1. Hilcorp's Intention Regarding Compliance 2. Discussion of Violations and Mitigating Circumstances 3. General Discussion regarding Changes in Drilling Plans 4. Progress on Corrective Actions 5. Concern about statement in letter of Hilcorp's disregard of AOGCC � Regulations 6. Reaffirmation of commitment to full compliance 2 . • Regg, James B (DOA) From: Paul Mazzolini [pmazzolini @hilcorp.com] Sent: Friday, November 02, 2012 4:36 PM To: Regg, James B (DOA) Cc: Kevin Tabler Subject: RE: Meeting between Hilcorp & AOGCC Jim, I would like to request an informal review with the Commission to discuss the Notice of Proposed Enforcement Action for Well SCU 44 -33. Hilcorp Alaska, LLC will be represented by myself, Kevin Tabler, Land Manager and Luke Keller, Drilling Engineer. As we realize that the Commission is extremely busy, we can make ourselves available next week from Monday after lunch until end of business on Thursday to participate in an informal review. I would request that when a date and time are set that possible attendees from the Commission be sent to us as well. I look forward to your response. Sincerely, Paul Mazzolini Drilling Manager Hilcorp Alaaska, LLC From: Regg, James B (DOA) [mailto:jim.reg9Cahalaska.gov] Sent: Friday, November 02, 2012 10:55 AM To: Paul Mazzolini Cc: Kevin Tabler Subject: RE: Meeting between Hilcorp & AOGCC Please clarify. Are you requesting a general discussion with staff or are you requesting an informal review as provided in 20 AAC 25.535(c)? Jim Regg AOGCC 333 W. 7th Ave, Suite 100 Anchorage, AK 99501 907 - 7934236 From: Paul Mazzolini [mailto :pmazzolini @hilcorp.com] Sent: Thursday, November 01, 2012 5:13 PM To: Regg, James B (DOA) Cc: Kevin Tabler Subject: Meeting between Hilcorp & AOGCC Jim, Good afternoon. I would like to propose any day next week except Monday morning and Friday to meet with the AOGCC to discuss the Notice of Proposed Enforcement Action. Hilcorp Alaska will be represented by myself and the Land Manager Kevin Tabler. I will await your response. 1 • • Regards Paul Mazzolini Drilling Manager Hilcorp Alaska,LLC 2 41 gi) :" or 1 j /j' THE STATE Alaska Oil and Gas W 9 �' °fA LASKA Conservation Commission GOVERNOR SEAN PARNELL 333 West Seventh Avenue Op. ie. Anchorage, Alaska 99501 -3572 Main: 907.279.1433 Fax: 907.276.7542 October 23, 2012 Certified Mail Return Receipt Requested 7009 2250 0004 3911 3279 Mr. Paul Mazzolini Drilling Manager Hilcorp Alaska LLC P. O. Box 244027 Anchorage, AK 99524 -4027 Re: Notice of Proposed Enforcement Action Failure to Notify of Changes to Approved Permit Failure to Test Blowout Prevention Equipment Soldotna Creek Unit 44 -33 (PTD 2121430) Dear Mr. Mazzolini: Pursuant to 20 AAC 25.535, the Alaska Oil and Gas Conservation Commission (AOGCC) hereby notifies Hilcorp Alaska, LLC. (Hilcorp) of a proposed enforcement action. Nature of the Apparent Violation or Noncompliance (20 AAC 25.535(6)(1)). The AOGCC considers that Hilcorp has violated the provisions of 20 AAC 25.015 ( "Changes to a program in a permit to drill") and the provisions of 2 0 AAC 25.035 ( "Secondary well control for primary drilling and completion") in its operation of Soldotna Creek Unit 44 -33 (SCU 44- 33). Basis for Finding the Violation or Noncompliance (20 AAC 25.535(b)(2)). Hilcorp failed to follow the well drilling procedures in Permit to Drill (PTD) number 2121430, approved by AOGCC on October 3, 2012, failed to notify AOGCC of changes to the approved well procedure, and failed to test blowout prevention equipment (BOPE) after being used in well control. Pursuant to AS 31.05.030, the AOGCC promulgated regulations to establish requirements for drilling oil and gas wells. Regulation 20 AAC 25.005 mandates a permit to drill, redrill, or re- enter an abandoned well must be approved by AOGCC before commencing drilling operations. Regulation 20 AAC 25.015 requires that any changes to a program approved in a PTD must be U.S. Postal Service,. CERTIFIED MAILTM RECEIPT Cr (Domestic Mail Only; No Insurance Coverage Provided) flJ For delivery information visit our website at www.usps.com OFFICIAL USE Postage $ Certified Fee STER S 41) I= Return Receipt Fee Em (Endorsement Required) ,-„.`." Here ce, \ " Restricted Delivery Fee (Endorsement Required) OCT /A t e 4 201 , Ln ru Total Postage Sent To AO- - Er Afcr:5 - Mr. Paul Mazzolini IZ:2 Street, Apt. No , Drilling Manager • or PO Box No. Hilcorp Alaska LLC City, State, ZIP PO Box 244027 tr '- PS Anchorage, AK 99524-4027 Form 3800: _ -verse or ns ructions'. SENDER: COMPLETE THIS SECTION COMPLETE THIS SECTION ON DELIVERY E Complete items 1, 2, and 3. Also complete A. Signature item 4 if Restricted Delivery is desired. X - 141Agent 0 Addressee E Print your name and address on the reverse so that we can return the card to you. B. Fyceiyed by ( Printed Name) C. Date of Delivery • Attach this card to the back of the mailpiece, tO or on the front if space permits. D. Is delivery addred.diffQt t frbm',em 1? 0 Yes 1. Article Addressed to: If YES, enter detiVer7adress 0 No 7C3/ 0 • Mr. Paul Mazzolini 3. Service Type S 99503 Drilling Manager 0 Certified Mail • Mail Hilcorp Alaska LLC 0 Registered 0 Return Receipt for Merchandise PO Box 244027 0 Insured Mail 0 C.O.D. Anchorage, AK 99524-4027 4. Restricted Delivery? (Extra Fee) 0 Yes 2. Article Number II I 16t19 tiffin"3911! A279 (Transfer from service labe0 PS Form 3811, February 2004 Domestic Return Receipt 102595-02-M-1540 • • Notice of Proposed Enforcement Action October 23, 2012 Page 2 of 4 authorized by AOGCC before making the change. Regulation 20 AAC 25.033(b) requires the drilling fluid program to be designed to maintain the wellbore in an overbalanced condition. Regulation 20 AAC 25.035(e)(10)(C) requires that BOPE used to control fluid flow to surface must be tested before the next wellbore entry. Hilcorp commenced sidetrack drilling of SCU 44 -33 at 1300 hours October 11, 2012 using Doyon Rig 1 (also known as Doyon Arctic Fox). A window was milled in the casing of suspended well SCU 24 -33 (PTD 1720070) by the rig after well work was completed to prepare it for drilling operations'. A Notice of BOPE Use was provided to AOGCC on October 12, 2012. Receipt of the BOPE notice initiated a review of the approved drilling permit and a request for additional information. Hilcorp responded with the requested information by electronic mail on October 15, 2012. Daily Drilling Reports indicate the casing window was milled at a depth approximately 500 feet shallower than approved in PTD 2121430. The mud weight was not increased prior to milling the window as required by that permit. The Drilling Reports further document that the well began to flow after milling 15 feet of casing, requiring Hilcorp to close the upper pipe rams within the BOP stack, and weight up and circulate kill- weight fluid into the well. Reports indicate Hilcorp circulated increasingly heavier kill weight fluid as part of continuing milling operations from October 11 through October 13. There was no request for a change in the approved well drilling procedure allowing for the shallower casing window and lower drilling mud weight. Hilcorp drilling reports also indicate that the drilling assembly was tripped to surface on October 13, 2012 and re -run in the well on October 14, 2012. There is no record of a test of the blowout prevention equipment used during well control operations prior to re- running the drilling assembly into the well. Hilcorp performed the required BOPE test on October 18, 2012. Proposed Action (20 AAC 25.535(b)(3). The AOGCC proposes to order the following corrective actions by Hilcorp: (1) Within 2 weeks following the date of receipt of AOGCC's final decision, Hilcorp shall provide a detailed description of its regulatory compliance program and a copy of its written management -of -change procedures; (2) Within 2 weeks following the date of receipt of AOGCC's final decision, Hilcorp shall complete and provide AOGCC with the results of a root cause analysis addressing the violations. (3) Within 4 weeks following the date of receipt of AOGCC final decision, Hilcorp shall provide evidence that personnel responsible for drilling and workover rig management, and staff involved with permitting well operations (drilling and workovers) have been 1 Application for Sundry Approvals, Form 10 -403, was approved by AOGCC allowing the well to be configured for sidetrack drilling of SCU 44 -33; refer to Sundry Approval 312 -353. 2 Refer to AOGCC Industry Guidance Bulletin 10 -003 for information required in the BOPE Use notice. • • Notice of Proposed Enforcement Action October 23, 2012 Page 3 of 4 trained in AOGCC drilling and workover regulatory requirements, including the process for making changes to approved activities, testing, and reporting requirements; (4) Beginning immediately upon receipt of AOGCC's final decision, BOPE testing on all drilling and workover operations must be performed when installed, repaired, or changed and at intervals not to exceed seven (7) days between tests unless otherwise approved by AOGCC. When used for well control or other equivalent purposes, or routine use may have compromised equipment effectiveness, BOPE used must be tested before the next wellbore entry. For violating 20 AAC 25.015, 25.033, and 25.035, the AOGCC intends to impose civil penalties on Hilcorp under AS 31.05.150 (a) as follows - $75,000 for the initial violation — failure to maintain the wellbore in an overbalanced condition by increasing the drilling fluid weight prior to milling the casing window as required in the PTD; - $7,500 for failing to notify AOGCC of change in well plans; specifically, using a lighter weight drilling fluid for milling and initial drilling operations than approved in the PTD; - $3,000 for failing to notify AOGCC of a change in well plans; specifically, milling the casing window at a shallower depth than approved in the PTD; - $7,500 for each day October 14 through October 17, 2012 for failing to test BOPE used in well control operations. The total proposed civil penalty is $115,500. The serious nature of violations relating to well control equipment and practices, and the actual or potential threat to public health or the environment, warrant penalties at the higher end of the scale. Hillcorp's disregard of the AOGCC's regulations and its aggressive approach to well work raise the potential for similar behavior with more serious consequences. Inadequacy in management -of -change protocols is an additional factor in the AOGCC's analysis. Rights and Liabilities (20 AAC 25.535(b)(4)). Within 15 days after receipt of this notification — unless the AOGCC, in its discretion, grants an extension for good cause shown — Hilcorp may file with the AOGCC a written response that concurs in whole or in part with the proposed action described herein, requests informal review, or requests a hearing under 20 AAC 25.540. If a timely response is not filed, the proposed action will be deemed accepted by default. If informal review is requested, the AOGCC will provide Hilcorp an opportunity to submit documentary material and make a written or oral statement. If Hilcorp disagrees with the AOGCC's proposed decision or order after that review, it may file a written request for a hearing within 10 days after the proposed decision or order is issued. If 3 AS 31.05.150(a) provides for not more than $100,000 for the initial violation and not more than $10,000 for each day thereafter on which the violation continues. 4 4 days; BOPE used for well control purposes on October 11, 2012; the drilling assembly was tripped to surface on October 13, 2012 (at surface 2230hrs); the drilling assembly was re -run into the well beginning 0330hrs October 4, 2012 without testing the BOPE components used for well control. BOPE were tested on October 18, 2012. • Notice of Proposed Enforcement Action October 23, 2012 Page 4 of 4 such a request is not filed within that 10 -day period, the proposed decision or order will become final on the 11 day after it was issued. If such a request is timely filed, the AOGCC will hold its decision in abeyance and schedule a hearing. If Hilcorp does not concur in the proposed action described herein, and the AOGCC finds that Hilcorp violated a provision of AS 31.05, 20 AAC 25, or an AOGCC order, permit or other approval, then the AOGCC may take any action authorized by the applicable law including ordering one or more of the following: (i) corrective action or remedial work; (ii) suspension or revocation of a permit or other approval; (iii) payment under the bond required by 20 AAC 25.025; and (iv) imposition of penalties under AS 31.05.150. In taking action after an informal review or hearing, the AOGCC is not limited to ordering the proposed action described herein, as long as Hilcorp received reasonable notice and opportunity to be heard with respect to the AOGCC's action. Any action described herein or taken after an informal review or hearing does not limit the action the AOGCC may take under AS 31.05.160. Sincerely, w it:7 t_4(...4,74 Cathy P. Foerster Chair, Commissioner