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CO 123 B
• 0 1. ►N 3. 4. 5. Index Conservation Order No. 123E Swanson River Field Soldotna Creek Unit Hemlock Oil Pool October 24, 2012 Hilcorp's request for Administrative action to eliminate well spacing requirements within the boundary of the Swanson River Field, Hemlock Oil Pool November 8, 2012 Hilcorp's revised request for Administrative action to eliminate well spacing requirements within the boundary of the Swanson River Field, Hemlock Oil Pool December 2, 2012 Notice of Public Hearing, Affidavit of Publication, Email Distribution, Bulk Mailing -------------------- Emails January 18, 2013 Notice of Public Hearing, Affidavit of Publication, Email Distribution, Bulk Mailing Conservation Order No. 123E STATE OF ALASKA ALASKA OIL AND GAS CONSERVATION COMMISSION 333 West 7th Avenue Anchorage, Alaska 99501 Re: THE APPLICATION OF Hilcorp Alaska, LLC. to revise well spacing requirements within the boundary of the Swanson River Field. BY THE COMMISSION: Docket CO-12-40 Conservation Order No. 123B Swanson River Field Swanson River Unit Soldotna Creek Unit Hemlock Oil Pool August 28, 2013 NOTICE CLOSING DOCKET The Commission has the closed the Docket in the above captioned matter. ENTERED AND EFFECTIVE at Anchorage, Alaska and this 28th day of August 2013. BY DIRECTION OF THE COMMISSION J. Wlo#ie al WssisYant to the Commission • 0 STATE OF ALASKA ALASKA OIL AND GAS CONSERVATION COMMISSION 333 West 71h Avenue Anchorage, Alaska 99501 Re: THE APPLICATION OF Hilcorp Alaska, LLC. to revise well spacing requirements within the boundary of the Swanson River Field. IT APPEARING THAT: Docket CO-12-40 Conservation Order No. 123B Swanson River Field Swanson River Unit Soldotna Creek Unit Hemlock Oil Pool August 28, 2013 1. By letters received October 25 and November 8, 2012, Hilcorp Alaska, LLC (Hilcorp) requests an order from the Alaska Oil and Gas Conservation Commission (AOGCC) to clarify the area affected by Conservation Order No. 123A (CO 123A), modify well spacing requirements of that order, and modify the rule that allows the order to be changed administratively. 2. On November 13, 2012, by certified mail, Hilcorp sent notice of the application to all owners, landowners, and operators of all properties within 3,000'of the Swanson River Field boundary. Hilcorp provided to AOGCC the notice, date of mailing, addresses to which the notice was sent, and proof of certified mailing. 3. Pursuant to 20 AAC 25.540, the AOGCC tentatively scheduled a public hearing for January 3, 2013. On November 20, 2012, the AOGCC mailed printed copies of the notice of the opportunity for public hearing to all persons on the AOGCC's mailing distribution list, published notice of the opportunity for that hearing on the State of Alaska's Online Public Notice website and on the AOGCC's website, and electronically transmitted the notice to all persons on the AOGCC's email distribution list. On December 2, 2012, the notice was published in the ALASKA JOURNAL OF COMMERCE. 4. No protest to the application or request for hearing was received. 5. AOGCC vacated tentatively scheduled public hearing on December 31, 2012. 6. On January 12, 2013, the AOGCC tentatively scheduled a second public hearing for February 26, 2013 in order to provide clear public notice that Hilcorp's letter of November 8, 2012 seeks to extend revised spacing requirements to all wells and all horizons within the field, in addition to those requests presented in Item 1, above. On January 20, 2012, the AOGCC mailed printed copies of the notice of the opportunity for public hearing to all persons on the AOGCC's mailing distribution list, published notice of the opportunity for CO 123B • • August 28, 2013 Page 2 of 6 that hearing on the State of Alaska's Online Public Notice website and on the AOGCC's website, and electronically transmitted the notice to all persons on the AOGCC's email distribution list. On January 18, 2013, the notice was published in the ANCHORAGE DAILY NEWS. 7. No protest to the application or request for hearing was received. 8. The tentatively scheduled public hearing was vacated on February 25, 2013. 9. Because Hilcorp provided sufficient information upon which to make an informed decision, the request can be resolved without a hearing. FINDINGS: 1. Operator: Hilcorp is the operator of the Swanson River Field, Swanson River Unit, and the Soldotna Creek Unit, which are located on the east side of the Cook Inlet, Kenai Peninsula Borough, Alaska. 2. Affected Area: The Swanson River Field —the Affected Area —lies onshore, Kenai Peninsula, Cook Inlet Basin. The northern two-thirds of the Swanson River Field are also known as the Swanson River Unit, and the southern one-third of the field is also known as the Soldotna Creek Unit. Owners and Landowners: Hilcorp is owner of the Swanson River Field. The U.S. Department of the Interior, Bureau of Land Management (BLM) and Cook Inlet Region, Inc. (CIRI) are landowners for the Swanson River Field. A single pooling agreement governs Swanson River Field.' 4. Pool Identification: Conservation Order No. 123A defines the Hemlock Oil Pool as all intervals which correlate with the interval 10,085' and 10,815' in the Standard Oil Company of California's (SOCAL) Soldotna Creek Unit No. 41-4 well.2 5. Exploration and Production History: The Hemlock Oil Pool within the Swanson River Unit was discovered in 1957 by the Swanson River Unit No. 13 well and confirmed by Swanson River Unit No. 24 in 1958 and Swanson River Unit No. 4A5 in 1959. Regular production from this portion of the Hemlock Oil Pool began in October 1958 and continues today. To date, 32 wells have produced oil from the Hemlock Oil Pool within the Swanson River Unit. The Hemlock Oil Pool in the Soldotna Creek Unit was discovered by Soldotna Creek Unit No. 41-42 in March 1960 and confirmed by the Soldotna Creek Unit No. 32-046 and No. 14- 047 wells in June and August 1960. Regular production from this portion of the Hemlock Oil 'Pooling Agreement for the Swanson River Field, Alaska; U.S. Department of the Interior, Geological Survey, Memorandum to Chief, Branch Oil & Gas Operations, dated December 28, 1964 2 API No. 50-133-10109-00-00; subsequently renamed Soldoma Creek Unit No. 341-04 by SOCAL circa 1967 3 Subsequently renamed Swanson River Unit No. 3 4- 10 4 Subsequently renamed Swanson River Unit No. 331-27 5 Subsequently renamed Swanson River Unit No. 14-15 6 Subsequently renamed Swanson River Unit No. 332-04 Subsequently renamed Swanson River Unit No. 314-04 CO 123B • • August 28, 2013 Page 3 of 6 Pool began in August 1960 and continues today. At present, 79 wells have produced oil from the Hemlock Oil Pool within the Soldotna Creek Unit. 6. Regulatory History: Conservation Order No. 5, issued November 25, 1960, approved a spacing pattern of 80 acres per well for reservoir development wells drilled in all pools of the Hemlock Zone within the limits of the Swanson River Field for a period of 18 months. Conservation Order No. 8, approved May 11, 1962, established the permanent spacing pattern of 80 acres per well for the Hemlock Zone within the field. Conservation Order No. 9, approved May 11, 1962, authorized injection of natural gas for pressure maintenance purposes into the Hemlock Zone of the Swanson River Field through specified wells. Conservation Order No. 123 (CO 123), approved August 23, 1973, defined the Hemlock Oil Pool within the Swanson River Field as all intervals that correlate with the interval from 10,230' to 10,585' in SOCAL's SCU 41-4 well and established pool rules to govern development. CO 123 Rule 5, Spacing Acreage, specified not more than two completed wells in any governmental quarter section, and Rule 6 specified that that no well shall be completed less than 500' from the exterior boundary of the Swanson River Field Working Interest Agreement Area. Between 1974 and 1982, eight Administrative Approvals were issued granting exceptions to CO 123 Rule 5, Spacing Acreage. Conservation Order No. 123A (CO 123A), approved December 5, 1995, expanded the Hemlock Oil Pool vertically to all intervals that correlate with the interval from 10,085' to 10,815' in SOCAL's SCU 41-4 well. The expanded pool includes the overlying G Zone of the Tyonek Formation and the underlying lower Hemlock sands HI through H15. CO 123A did not alter the well spacing requirements of CO 123. Between 2000 and 2012, three Administrative Approvals were issued granting exceptions to CO 123A Rule 5, Spacing. For all other hydrocarbon -bearing horizons within the Swanson River Field, statewide regulation 20 AAC 25.055 governs well spacing and specifies notification by certified mail of potentially affected owners, landowners and operators when a proposed well location will not conform to property -line setback requirements. 7. Application Notification: Hilcorp provided evidence to the AOGCC that the application was sent by certified mail to all affected working interest owners and landowners—i. e. , Cook Inlet Region, Inc. and the U.S. Bureau of Land Management —on November 13, 2012. 8. Proposed Change to the Well Spacing Requirements: Hilcorp's revised letter of application requested the AOGCC modify well spacing requirements to remove spacing restrictions except that no well shall be completed less than 500' from the exterior boundary line of the Affected Area. Hilcorp also requested the AOGCC expand the modified well spacing requirements to include all wells and all horizons within the Swanson River Field. 9. Proposed Change to the Affected Area: Hilcorp's revised letter of application requested the AOGCC modify the Affected Area of this order to conform to Hilcorp's map of the combined area of the Swanson River and Soldotna Creek Units that accompanied the revised letter of application! 8 Hilcorp Alaska, LLC, (Revised) Proposed Second Amendment to Conservation Order No. 123A, Letter of Application, dated November 8, 2012, Exhibit A. CO 123B • • August 28, 2013 Page 4 of 6 10. Proposed Change to the Administrative Approval Rule: Hilcorp's revised letter of application requested the AOGCC modify the text of Rule 7 of CO 123A to authorize any reasonable operation designed to maximize the recovery of oil and all other hydrocarbons in the Swanson River Field and to allow administrative changes to the boundaries of the Affected Area. CONCLUSIONS: 1. The Hemlock Oil Pool within the Swanson River Field is a mature, producing pool. 2. Revising well spacing provisions for the Hemlock Oil Pool within the Affected Area will increase the operator's flexibility when placing wells to optimize resource recovery. Revising well spacing provisions for the Hemlock Oil Pool will not promote waste, jeopardize correlative rights, or result in an increased risk of fluid movement into freshwater. 3. Changing well spacing requirements for other oil or gas pools or reservoirs within the Swanson River Field is unwarranted at this time as Hilcorp provided no supporting geologic or engineering evidence to show that proposed change will not promote waste, jeopardize correlative rights, or result in an increased risk of fluid movement into freshwater. 4. Correlative rights of owners and landowners of offset acreage will be protected by a 500-foot property line set -back requirement for the external boundary of the Affected Area that conforms with regulation 20 AAC 25.055(a)(1). 5. The ability to administratively change the external boundary of the Affected Area is not warranted. The notification requirements of 20 AAC 25.055 and 20 AAC 25.540 protect the correlative rights of owners and landowners of adjacent acreage who may be impacted by proposed changes to the Affected Area. NOW THEREFORE IT IS ORDERED: Hilcorp's November 8, 2012 application for an order modifying the well spacing and Administrative Action provisions of CO 123A is approved for the Hemlock Oil Pool within the Affected Area specified below. Hilcorp may proceed as long as it complies with the terms of the Pooling Agreement for the Swanson River Field, the Swanson River and Soldotna Creek Unit Agreements, applicable Alaska laws, and all other legal requirements. Development and operation of the Hemlock Oil Pool is subject to the rules in CO 123 and CO 123A and the amendments thereto and the statewide requirements under 20 AAC 25 to the extent not superseded by the following rules: CO 123B • • August 28, 2013 Page 5 of 6 Affected Area - Swanson River Field: Seward Meridian (revised this order) The Affected Area for the Swanson River Field comprises the combined Swanson River and Soldotna Creek Units as follows: Swanson River Unit Township, Range Description T08N, R09W Section 9: SE'/4 NE'/4, E'/z SE'/4, NW'/4 SEI/4 Section 10: W%2 WI/z, SE'/4 NW'/4, E'/2 SW'/4, W%z SEI/4, SEl/4 SE'/4 Section 15: All Section 16: EI/2 �7 Section 21 : NEI/4, E%2 NWI/4, EI/2 SEI/4, NWI/4 SEI/4, NEI/4 SWl/4 Section 22: WI/2, SEI/4, WI/2 NEI/4, SEI/4 NEI/4 Section 27: NEI/4, WI/2 SEI/4, WI/2 Section 28: EI/2 EI/2, SWI/4 NEI/4, W%2 SEI/4, EI/2 SWI/4 Section 32: E%2 SEI/4, SWI/4 SEI/4 Section 33: SWI/4, EI/2 NWI/4, SWI/4 NWI/4,NEI/4 Section 34: NWI/4, WI/2 NEI/4 Soldotna Creek Unit Township, Range Description T07N, R09W Section 3: WI/2, WI/2 NEI/4, NWI/4 SEI/4 Section 4: All Section 5: EI/2, SWI/4 Section 8: EI/2, EI/2WI/2, NWI/4 NWI/4 Section 9: All Section 10: WI/2 WI/2, NEI/4 NWI/4 Section 12: NWI/4, WI/2 NEI/4, NEI/4 NEI/4 Section 17: NEI/4 NEI/4 T08N, R09W Section 33: SEI/4 Section 34: SWI/4, WI/2 SEI/2 Rule 5 Well Spacing (Source: CO 123A, revised this order) There shall be no restrictions as to well spacing within the Hemlock Oil Pool except that no wellbore may be open to test or regular production in a well within 500 feet of the external property line of the Affected Area described above where the owners and landowners are not the same on both sides of the line. CO 123B • August 28, 2013 Page 6 of 6 Rule 7 Administrative Action (Source: CO 123A, revised this order) Upon proper application, or its own motion, and unless notice and public hearing are otherwise required, the AOGCC may administratively waive the requirements of any rule stated herein or administratively amend this order as long as the change does not promote waste or jeopardize correlative rights, is based on sound engineering and geoscience principles, and will not result in an increased risk of fluid movement into freshwater. DONE at Anchorage, Alaska and dated August 28, 2( Cathy . Foerster Chair, Commissioner I.kill III II JJIVllcl 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), "[t]he 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 runs until 5:00 p.m. on the next day that does not fall on a weekend or state holiday. Singh, Angela K (DOA) From: Colombie, Jody J (DOA) Sent Thursday, August 29, 2013 11:21 AM To: Singh, Angela K (DOA); Ballantine, Tab A (LAW); Bettis, Patricia K (DOA); Brooks, Phoebe L (DOA); Colombie, Jody J (DOA); Crisp, John H (DOA); Davies, Stephen F (DOA); Ferguson, Victoria L (DOA); Fisher, Samantha 1(DOA); Foerster, Catherine P (DOA); Grimaldi, Louis R (DOA); Hunt, Jennifer L (DOA); Johnson, Elaine M (DOA); Jones, Jeffery B (DOA); Laasch, Linda K (DOA); Bender, Makana K (DOA); Mumm, Joseph (DOA sponsored); Noble, Robert C (DOA); Norman, John K (DOA); Okland, Howard D (DOA); Paladijczuk, Tracie L (DOA); Pasqual, Maria (DOA); Regg, James B (DOA); Roby, David S (DOA); Scheve, Charles M (DOA); Schwartz, Guy L (DOA); Seamount, Dan T (DOA); Wallace, Chris D (DOA); (michael j.nelson@conocophillips.com); AKDCWeIIIntegrityCoordinator, Alexander Bridge; Andrew Vandedack, Anna Raff; Barbara F Fullmer, bbritch; bbohrer@ap.org; Bill Penrose; Bill Walker, Brian Havelock; Burdick, John D (DNR); caunderwood@marathonoil.com; Cliff Posey, Colleen Miller, Crandall, Krissell; D Lawrence; Daryl J. Kleppin; Dave Harbour, Dave Matthews, David Boelens; David Duffy, David Goade; David House; David Scott; David Steingreaber; Davide Simeone; ddonkel@cfl.rr.com; Donna Ambruz; Dowdy, Alicia G (DNR); Dudley Platt, Elowe, Kristin; Evans, John R (LDZX); Francis S. Sommer, Frank Molli; Gary Laughlin; schultz, gary (DNR sponsored); ghammons; Gordon Pospisil; Gorney, David L.; Greg Duggin; Gregg Nady; Gregory Geddes; gspfoff, Jacki Rose; Jdarlington Oadington@gmail.com); Jeanne McPherren; Jones, Jeffery B (DOA); Jerry McCutcheon; Jim White; Jim Winegamer, Joe Lastufka; news@radiokenai.com; Easton, John R (DNR); John Garing; Jon Goltz, Jones, Jeffrey L (GOV); Juanita Lovett; Judy Stanek, Houle, Julie (DNR); Julie Little; Kari Moriarty; Kaynell Zeman; Keith Wiles; Kelly Sperback; Kiorpes, Steve T; Klippmann; Gregersen, Laura S (DNR); Leslie Smith; Lisa Parker, Louisiana Cutler, Luke Keller, Marc Kovak; Dalton, Mark (DOT sponsored); Mark Hanley (mark.hanley@anadarko.com); Mark P. Worcester, Kremer, Marguerite C (DNR); Michael Jacobs; Mike Bill; mike@kbbi.org; Mikel Schultz; Mindy Lewis; MJ Loveland; mjnelson; mkm7200; knelson@petroleumnews.com; Nick W. Glover, Nikki Martin; NSK Problem Well Supv; Patty Alfaro; Decker, Paul L (DNR); Paul Mazzolini; Pike, Kevin W (DNR); Pioneer, Randall Kanady; Randy L. Skillern; Randy Redmond; Rena Delbridge; Renan Yanish; Robert Brelsford; Robert Campbell; Ryan Tunseth; Sandra Haggard; Sara Leverette; Scott Griffith; Shannon Donnelly; Sharmaine Copeland; Sharon Yarawskr,, Shellenbaum, Diane P (DNR); Slemons, Jonne D (DNR); Smith, Kyle S (DNR); Sondra Stewman; Stephanie Klemmer, Moothart, Steve R (DNR); Steven R. Rossberg, Suzanne Gibson; sheffield@aoga.org; Tania Ramos; Ted Kramer, Davidson, Temple (DNR); Terence Dalton; Teresa Imm; Thor Cutler; Tim Mayers, Tina Grovier (tmgrovier@stoel.com); Todd Durkee, Tony Hopfinger; trmjrl; Vicki Irwin; Walter Featherly; yjrosen@ak.net, Aaron Gluzman; Aaron Sorrell; Ajibola Adeyeye; Amanda Dial; Bruce Williams; Bruno, Jeff J (DNR); Casey Sullivan; David Lenig; David Martin; David Ross; Perrin, Don J (DNR); Donna Vukich; Eric Lidji; Erik Opstad; Gary Orr, Smith, Graham O (PCO); Greg Mattson; Heusser, Heather A (DNR); Holly Pearen; James Rodgers; Jason Bergerson; Jennifer Starck; jill.a.mcleod@conocophillips.com; Jim Magill; Joe Longo; King, Kathleen J (DNR); Laney Vazquez, Lois Epstein; Marc Kuck; Steele, Marie C (DNR); Matt Armstrong; Matt Gill; Michael Quick; Franger, James M (DNR); Bettis, Patricia K (DOA); Peter Contreras, Pollet, Jolie; Richard Garrard; Ryan Daniel; Sandra Lemke; Pexton, Scott R (DNR); Pollard, Susan R (LAW); Talib Syed; Tim Flynn; Wayne Wooster; Woolf, Wendy C (DNR); William Hutto; William Van Dyke Subject: co123b (Hilcorp Alaska) Swanson River Field Attachments: co123b.pdf • JodyJ. Colombie Special Assistant Alaska Oil and Gas Conservation Commission 333 W. 71h Avenue Anchorage, Alaska 99501 (907) 793-1221 (907) 276-7542 Easy Peel® Labels i ♦ Bend along line to 11 Aj/Ei® 5160� Use Avery® Template 51600 Feed Paper ��■ expose Pop-up Edge*"' 1 David W. Duffy Hilcorp Alaska, LLC Post Office Box 244027 Anchorage, AK 99524-4027 1 Iztiquettes faciles A peler ; A Repliez A la hachure arm de ; www.avery.com Utilisez le aabarit AVERY® 5160's , tis„„o dQ„. rev6ler le rebord Pop-up" ; 1-800-GO-AVERY L Easy Peel* Labels Use Avery® Template 51600 Bend along line to Feed Paper expose Pop-up EdgeTm 16 A AVERY® 5q60Tm 1 Penny Vadla 399 W. Riverview Ave. Soidotna, AK 99669-7714 Jerry Hodgden Hodgden Oil Company 408 le St. Golden, CO 80401-2433 Bernie Karl K&K Recycling Inc. Post Office Box 58055 Fairbanks, AK 99711 North Slope Borough Planning Department Post Office Box 69 Barrow, AK 99723 Jack Hakkila Post Office Box 190083 Anchorage, AK 99519 David McCaleb IHS Energy Group GEPS 5333 Westheimer, Ste. 100 Houston, TX 77056 Richard Neahring NRG Associates President Post Office Box 1655 Colorado Springs, CO 80901 CIRI Land Department Post Office Box 93330 Anchorage, AK 99503 Richard Wagner Post Office Box 60868 Fairbanks, AK 99706 Darwin Waidsmith Post Office Box 39309 Ninilchik, AK 99639 George Vaught, Jr. Post Office Box 13557 Denver, CO 80201-3557 Mark Wedman Halliburton 6900 Arctic Blvd. Anchorage, AK 99502 Baker Oil Tools 795 E. 94' Ct. Anchorage, AK 99515-4295 Gordon Severson 3201 Westmar Cir. Anchorage, AK 99508-4336 James Gibbs Post Office Box 1597 Soldotna, AK 99669 ttiquettes faciles a peter i �A de Repflez a to hachure akin de ; www averycom I ttiiicav Iv nahari4 AVFRV® K9An® ! _�_. nsvalar In rahnrd PnnamTm ! 9_RA1LP,n_AVr.RV 1 0 STATE OF ALASKA • ADVERTISING ORDER NO. S NOTICE TO PUBLISHER ADVERTISING INVOICE MUST BE IN TRIPLICATE SHOWING ADVERTISING ORDER NO., CERTIFIED AO-�2-I "31 AFFIDAVIT OF PUBLICATION (PART 2 OF THIS FORM) WITH ATTACHED COPY OF ORDER ADVERTISEMENT MUST BE SUBMITTED WITH INVOICE F AOGCC R 333 W 7th Ave, Ste 100 D Anchorage, AK 99501 M o Anchorage Daily News PO Box 149001 Anchorage, AK 99514 AGENCY CONTACT DATE OF A.o. January 17, 2013 Jody Colombie PHONE PCN i DATES ADVERTISEMENT REQUIRED: January 18, 2013 THE MATERIAL BETWEEN THE DOUBLE LINES MUST BE PRINTED IN ITS ENTIRETY ON THE DATES SHOWN. Type of Advertisement Legal® ❑ Display Classified ❑Other (Specify) SEE ATTACHED 2 IARDI FIN AMOUNT 1 2 Amend CO 123A AOGCC, 333 W. 7th Ave., Suite 100 Anchorage, AK 99501 JMBER AMOUNT 2910 _ SY CC PGM 13 02140100 PAGE 1 OF TOTAL OF 2 PAGES ALL PAGES LC ACCT FY I NMR DIST 73451 Copies: Department Fiscal, Department, Receiving AO.FRM 0 Notice of Public Hearing STATE OF ALASKA Alaska Oil and Gas Conservation Commission Re: Docket No. CO-12-40. The revised application of Hilcorp Alaska, LLC (Hilcorp) to amend Conservation Order No. 123A (CO 123A) to clarify the affected geographic area, expand the affected geologic intervals to include all wells and all horizons within the Swanson River Field, alter well -spacing restrictions, and expand the scope of the types of amendments to the order which can be made by administrative approval. CO 123A governs the Hemlock Oil Pool, Swanson River Field, Kenai Peninsula Borough, Alaska. Hilcorp's November 8, 2012 revised application requests the Alaska Oil and Gas Conservation Commission (AOGCC) amend Rule 2 (Rules Area), Rule 5 (Spacing) and Rule 7 (Administrative Approval) of CO 123A. Rule 2 describes the geographic area affected by CO 123A. Hilcorp proposes to clarify that description and to expand Rule 2 to include the entire geologic column within the affected geographic area. Rule 5 limits the number of wells allowed in any governmental quarter section to two. Hilcorp proposes to delete any restriction on the number or spacing of wells, but does not seek to alter the prohibition against any well being completed less than 500 feet from the Swanson River Field exterior boundary line. Hilcorp proposes to expand the scope of Rule 7, which allows administrative changes to the rules or geographic area affected by Conservation Order No. 123A. The AOGCC has tentatively scheduled a public hearing on this application for February 26, 2013 at 9:00 a.m. at the Alaska Oil and Gas Conservation Commission, at 333 West 71' Avenue, Suite 100, Anchorage, Alaska 99501. To request that the tentatively scheduled hearing be held, a written request must be filed with the AOGCC no later than 4:30 p.m. on February 4, 2013. If a request for a hearing is not timely filed, the AOGCC may consider the issuance of an order without a hearing. To learn if the AOGCC will hold the hearing, call 793-1221 after February 11, 2013. In addition, written comments regarding this application may be submitted to the Alaska Oil and Gas Conservation Commission, at 333 West 7`h Avenue, Suite 100, Anchorage, Alaska 99501. Comments must be received no later than 4:30 p.m. on February 19, 2013, except that, if a hearing is held, comments must be received no later than the conclusion of the February 26, 2013 hearing. If, because of a disability, special accommodations may be needed to comment or attend the hearing, contact the AOGCC's Special Assistant, Jody Colombie, at 793-1221, no later than February 22, 2013. Cathy P. Foerster Chair, Commissioner RECEIVED JAN 3 0 2013 STOF0330 # 184931 AO G C $255.64 AFFIDAVIT OF PUBLICATION STATE OF ALASKA THIRD JUDICIAL DISTRICT Joleesa Stepetin being first duly sworn on oath deposes and says that he/she is a representative of the Anchorage Daily News, a daily newspaper. That said newspaper has been approved by the Third Judicial Court, Anchorage, Alaska, and it now and has been published in the English language continually as a daily newspaper in Anchorage, Alaska, and it is now and during all said time was printed in an office maintained at the aforesaid place of publication of said newspaper. That the annexed is a copy of an advertisement as it was published in regular issues (and not in supplemental form) of said newspaper on January 18, 2013 and that such newspaper was regularly distributed to its, subscribers during all of said period. That the full amount of the fee charged for the foregoing publication is not in excess of the rate c ged private * ivi ails. Signe Subscribed and sworn to before � % me this � day of `J ' t `� r ?.o 117 -L _ Notary Public in and for The State of Alaska. Third Division Anchorage, Alaska MY COMMISSIO l 1) Notice of PubHcHearing AteskaOitaudC.as OCoHse3vaa.Commission le: Docket No. CO-12.40.The revised applicatioi )f HilcorA Alaska. LLC (Hilcornl to amens amenaments to the order which can be made'b) administrative approval. CO 123A governs the Hemlock oil Pool, Swanson River Field, Kenai Peninsula Borough, Alaska. Hilcorp's November8, 2012revised`application requests the Alaska Oil and Gas Conservation Commission (AOGCQ amend Rule 2 (Rules Area), Rule 5 (Sparing) and Rule 7 (Administrative Approval) Of CO 123A. Rule 2 describes the geographic area affected by CO 123A. Hilcorp proposes. to clarify that description and to expand Rule 2 to include the entire geologic column within theaffected geographic area, Rule 5 limits the number of walla alrnvr d In axu ne. 3phic area affected by Conservation Order No OGCC has tentatively scheduled a public g o.n this application for February-26, 2013 at m, at the Alaska Oil and Gas Conservation fission, at 333 West 7th Avenue, Suite 100, 30 P.M. on February 4, 2013. ring, csa /VS-1221,after ; February 11, 2013 Ition, written comments reSardin8g this tion ma1y, be submitted to the Alaska Oil and nservatIon Commission, at 333 west 7th 3, Suite ,1A0, Anchorage Alaska 99501. TO must be received no MW than 4:30 P.M. Wary 19, 413, except ftt,, if a hearing is contact the AOGCC's Special Assistant, Jody Colombia, at 793-1221, no later than February 22, 2013. Cathy P. Faerster Chao Commissioner AO-02-3-14-031 I Published: January 18, 2013 0 • STATE OF ALASKA NOTICE TO PUBLISHER ADVERTISING ORDER NO. ADVERTISING INVOICE MUST BE IN TRIPLICATE SHOWING ADVERTISING ORDER NO., CERTIFIED /� /\I�_131 ORDER AFFIDAVIT OF PUBLICATION (PART 2 OF THIS FORM) WITH ATTACHED COPY OF AO-0 ADVERTISEMENT MUST BE SUBMITTED WITH INVOICE F I AOGCC R 1333 West 7t' Avenue. Suite 100 o Anchorage. AK 99501 M o Anchorage Daily News PO Box 149001 Anchorage, AK 99514 United states of America State of division. AGENCY CONTACT DATE OF A.O. Jodv Colornbie January 17.2013 PHONE PCN (907) 793 -1221 DATES ADVERTISEMENT REQUIRED: January 18, 2013 THE MATERIAL BETWEEN THE DOUBLE LINES MUST BE PRINTED IN ITS ENTIRETY ON THE DATES SHOWN. SPECIAL INSTRUCTIONS: Account # STOF0330 AFFIDAVIT OF PUBLICATION REMINDER ss INVOICE MUST BE IN TRIPLICATE AND MUST REFERENCE THE ADVERTISING ORDER NUMBER. A CERTIFIED COPY OF THIS AFFIDAVIT OF PUBLICATION MUST BE SUBMITTED WITH THE INVOICE. Before me, the undersigned, a notary public this day personally appeared ATTACH PROOF OF PUBLICATION HERE. who, being first duly sworn, according to law, says that he/she is the Of Published at in said division and state of and that the advertisement, of which the annexed is a true copy, was published in said publication on the day of 2012, and thereafter for consecutive days, the last publication appearing on the day of . 2012, and that the rate charged thereon is not in excess of the rate charged private individuals. Subscribed and sworn to before me This _ day of 2012, Notary public for state of My commission expires _ Colombie, Jody J (DOA) 0 • From: Fisher, Samantha J (DOA) Sent: Thursday, January 17, 2013 9:48 AM To: (michael j.nelson@conocophillips.com); /o=SOA/ou=First Administrative Group/cn=Recipients/cn=cotaylor; Abbie Jossie; AKDCWellIntegrityCoordinator; alaska@petrocalc.com; Alexander Bridge; Andrew VanderJack; Anna Raff; Barbara F Fullmer, bbritch; bbohrer@ap.org; Bill Penrose; Bill Walker; Bowen Roberts; Brian Havelock; Bruce Webb; caunderwood@marathonoil.com; Cliff Posey; Crandall, Krissell; D Lawrence; Daryl J. Kleppin; Dave Harbour, Dave Matthews; David Boelens; David Duffy; David House; David Scott; David Steingreaber; Davide Simeone; ddonkel@cfl.rr.com; Dowdy, Alicia G (DNR); Dudley Platt; Elowe, Kristin; Francis S. Sommer; Gary Laughlin; Schultz, gary (DNR sponsored); ghammons; Gordon Pospisil; Gorney, David L.; Greg Duggin; Gregg Nady; Gregory Geddes; gspfoff, Jdarlington oarlington@gmail.com); Jeanne McPherren; Jones, Jeffery B (DOA); Jerry McCutcheon; Jill Womack; Jim White; Jim Winegarner; Joe Lastufka; news@radiokenai.com; Easton, John R (DNR); John Evans; John Garing; John Spain; Jon Goltz; Jones, Jeffrey L (GOV); Juanita Lovett; Judy Stanek; Houle, Julie (DNR); Julie Little; Kari Moriarty; Kaynell Zeman; Keith Wiles; Kelly Sperback; Gregersen, Laura S (DNR); Luke Keller, Marc Kovak; Mark Dalton; Mark Hanley (mark.hanley@anadarko.com); Mark P. Worcester, Kremer, Marguerite C (DNR); Michael Jacobs; Mike Bill; mike@kbbi.org; Mike Morgan; Mikel Schultz; Mindy Lewis; MJ Loveland; mjnelson; mkm7200; knelson@petroleumnews.com; Nick W. Glover, Nikki Martin; NSK Problem Well Supv; Patty Alfaro; Decker, Paul L (DNR); Paul Mazzolini; Pike, Kevin W (DNR); Randall Kanady; Randy L. Skillern; Randy Redmond; Rena Delbridge; Renan Yanish; Robert Brelsford; Robert Campbell; Ryan Tunseth; Sara Leverette; Scott Cranswick; Scott Griffith; Shannon Donnelly; Sharmaine Copeland; Sharon Yarawsky; Shellenbaum, Diane P (DNR); Slemons, Jonne D (DNR); Smith, Kyle S (DNR); Sondra Stewman; Stephanie Klemmer; Steve Miller; Moothart, Steve R (DNR); Steven R. Rossberg; Suzanne Gibson; sheffield@aoga.org; Ted Kramer, Davidson, Temple (DNR); Teresa Imm; Thor Cutler, Tim Mayers; Tina Grovier; Todd Durkee; Tony Hopfinger; trmjrl; Vicki Irwin; Walter Featherly; yjrosen@ak.net; Aaron Gluzman; Aaron Sorrell; Bruce Williams; Bruno, Jeff J (DNR); Casey Sullivan; Dale Hoffman; David Lenig; Donna Vukich; Eric Lidji; Erik Opstad; Franger, James M (DNR); Gary Orr; Smith, Graham O (PCO); Greg Mattson; Heusser, Heather A (DNR); James Rodgers; Jason Bergerson; Jennifer Starck; jill.a.mcleod@conocophillips.com; Jim Magill; Joe Longo; King, Kathleen J (DNR); Lara Coates; Lois Epstein; Louisiana Cutler; Marc Kuck; Steele, Marie C (DNR); Matt Gill; Ostrovsky, Larry (DNR sponsored); Bettis, Patricia K (DOA); Perrin, Don J (DNR); Peter Contreras; Pexton, Scott R (DNR); Pollard, Susan R (LAW); Richard Garrard; Ryan Daniel; Sandra Lemke; Talib Syed; Wayne Wooster; Woolf, Wendy C (DNR); William Hutto; William Van Dyke; Ballantine, Tab A (LAW); Bender, Makana K (DOA); Bettis, Patricia K (DOA); Brooks, Phoebe L (DOA); Colombie, Jody J (DOA); Crisp, John H (DOA); Davies, Stephen F (DOA); Ferguson, Victoria L (DOA); Fisher, Samantha J (DOA); Foerster, Catherine P (DOA); Grimaldi, Louis R (DOA); Johnson, Elaine M (DOA); Laasch, Linda K (DOA); McIver, Bren (DOA); McMains, Stephen E (DOA); Mumm, Joseph (DOA sponsored); Noble, Robert C (DOA); Norman, John K (DOA); Okland, Howard D (DOA); Paladijczuk, Tracie L (DOA); Pasqual, Maria (DOA); Regg, James B (DOA); Roby, David S (DOA); Scheve, Charles M (DOA); Schwartz, Guy L (DOA); Seamount, Dan T (DOA); Singh, Angela K (DOA); Wallace, Chris D (DOA) Subject: Public Hearing Notice Swanson River Field Amend CO 123A (Hilcorp) Attachments: Public Hearing Notice CO-12-40.pdf Please see attached. Samantha Fisher Executive Secretary II Alaska Oil and Gas Conservation Commission 333 West 7th Avenue, Suite 100 Anchorage, AK 99501 (907) 793-1223 (phone) (907) 276-7542 (fax) Easy Peel® Labels *eed A Bend alongline to Use Avery® Template 51600 Paper expose Pop-up EdgeTM 0 David McCaleb Penny Vadla IHS Energy Group 399 W. Riverview Ave. GEPS Soldotna, AK 99669-7714 5333 Westheimer, Ste.100 Houston, TX 77056 Jerry Hodgden Hodgden Oil Company 40818' St. Golden, CO 80401-2433 Bernie Karl K&K Recycling Inc. Post Office Box 58055 Fairbanks, AK 99711 North Slope Borough Planning Department Post Office Box 69 Barrow, AK 99723 Jack Hakkila Post Office Box 190083 Anchorage, AK 99519 Richard Neahring NRG Associates President P.O. Box 1655 Colorado Springs, CO 80901 CIRI Land Department Post Office Box 93330 Anchorage, AK 99503 Richard Wagner Post Office Box 60868 Fairbanks, AK 99706 Darwin Waldsmith Post Office Box 39309 Ninilchik, AK 99639 I��AVERY0 5960TM George Vaught, Jr. Post Office Box 13557 Denver, CO 80201-3557 Mark Wedman Halliburton 6900 Arctic Blvd. Anchorage, AK 99502 Baker Oil Tools 795 E. 94"' Ct. Anchorage, AK 99515-4295 Gordon Severson 3201 Westmar Cir. Anchorage, AK 99508-4336 James Gibbs Post Office Box 1597 Soldotna, AK 99669 Etiquettes faciles a peter I A Repliez A la hachure afin de I www.avery.com ; Sens de - ..� i 11-9nn-r-n-evCov M, • • Davies, Stephen F (DOA) From: Davies, Stephen F (DOA) Sent: Tuesday, April 02, 2013 9:02 AM To: Schwartz, Guy L (DOA) Subject: RE: SRU 13-27 perf adds Guy, Spacing is not a concern for these additional perfs since they will be in the Hemlock Oil Pool. According to an email from David Duffy of Hilcorp*, SRU 13-27 is the second well open to the Hemlock Oil Pool in SW1/4 of Section 27, T8N, R9W, SM, so the proposed perfs will conform with the requirements of CO 123A. Cheers, Steve D *David Duffy, Hilcorp, "RE: SRU 13-27 Sundry Application" dated 3/7/2013 From: Schwartz, Guy L (DOA) Sent: Tuesday, April 02, 2013 8:21 AM To: Davies, Stephen F (DOA) Subject: FW: SRU 13-27 perf adds Can we chat about this .. Guy Schwartz Senior Petroleum Engineer AOGCC 907-444-3433 cell 907-793-1226 office From: Chad Helgeson[mailto:chelgesonCabhilcorp.com] Sent: Monday, April 01, 2013 2:05 PM To: Schwartz, Guy L (DOA) Subject: SRU 13-27 pert adds Guy, I sent a request to you a couple weeks ago about possibly adding the H12 perfs to the SRU 13-27 (new drill well) after we complete some testing. I would also like to request the addition of an additional 18ft in the top of the H13 sand. We would like to perforate 11,592-11,610' in this zone. We already have 11,612-11,631' perforated. I assume this is not an issue, but wanted to check with you before we went forward with adding perforations in this well. If you could let me know on the perforating of the H12 in this well too would be greatly appreciated as well. This was the interval 11,555' - 11,578' (23'). Let me know if you have any questions or need additional information. Chad Helgeson Operations Manager North Kenai Asset Team Hilcorp Alaska, LLC Legend Surface Hole Location • Bottom Hole Location Abandoned Well — — — Well Paths j _ j Field Boundary ------------------- SRU 223-28 BHL 14 Hilcorp Alaska, LIX 28 A028399 SRU 12-27 BHL KGSF7 BHL KGSF3 BHL/ / KGSF2 BHL I / KGSF7A BHL SRU 23-27 BHL SRU 13-27 `a SRU 13-27 1 Bottom Hole Location l Top and Bottom of Productive Interval S008NO09W j SRU 13-27 Surface Hole Location _ — — — SRU 32A-33 BHL I -----• S A028990 t,FU 343-33 A028406 'I SRU 314-27 BHL ('SRU 314-27PB1 BHL Swanson River Field SRU 13-27 SRU 146-27 BHL SRU 21A-34 BHL Soldotna Creek 1,. SCU 13-34 BHL r 0 1,000 2,000 Feet Alaska State Plane Zone 4, NAD27 Map Date March 7, 2013 • • Colombie, Jody J (DOA) From: Davies, Stephen F (DOA) Sent: Monday, December 31, 2012 9:54 AM To: David Duffy - (C); Judy Stanek Cc: Colombie, Jody J (DOA) Subject: FW: Docket No. CO-12-28 status question David and Judy: The AOGCC's Commissioners have decided to vacate the public hearing that was tentatively set for January 3, 2013 concerning Hilcorp's application to amend Conservation Order 123A. Please contact Jody Colombie or me if you have any questions. Best Regards, Steve Davies Sr. Petroleum Geologist Alaska Oil and Gas Conservation Commission (AOGCC) Phone: 907-793-1224 Fax: 907-276-7542 From: "David Duffy - (C)" <dduffy@hilcorp.com> Date: December 28, 2012, 11:31:23 AM AKST To: "iody.colombie@alaska.gov" <iody.colombie@alaska.gov> Subject: Docket No. CO-12-28 status question Hi Jody — hope you had a great Christmas. There is a tentative hearing set for Jan. 3 at 9:00 AM on Hilcorp's application to amend CO 123A. Just wondering if any comments have been received, and if not, whether the Commission will consider issuance of an order without a hearing. Any updates appreciated. David Duffy, Landman Hilcorp Alaska, LLC 3800 Centerpoint Drive, Suite 100 Anchorage, Alaska 99503 Office: 907 777-8300 Direct: 907 777-8414 Fax: 907 777-8580 Email: dduffy@hilcorp.com This email may contain confidential and/or privileged information and is intended for the recipient(s) only. In the event you receive this message in error, please notify me and delete the message. • • Davies, Stephen F (DOA) From: Davidson, Temple (DNR) Sent: Friday, November 23, 2012 4:03 PM To: Davies, Stephen F (DOA) Cc: dglass@ciri.com Subject: B-15 well Attachments: HVB-15 Spacing Exception Submitted 08-15-12.pdf.pdf Hi Steve, Hope you had a wonderful Thanksgiving! I wanted to confirm that we have received the spacing exception request and that we have no objection —we would concur with the AOGCC determination. Thanks, Temple Ms. Temple Davidson Petroleum Reservoir Engineer State of Alaska Department of Natural Resources Division of Oil and Gas 550 W. 7th Avenue Anchorage, Alaska 99501 907.269.8784 CONFIDENTIALITY NOTICE: This e-mail message, including any attachments, contains information from the Department of Natural Resources (DNR), State of Alaska and is for the sole use of the intended recipient(s). It may contain confidential and/or privileged information. The unauthorized review, use or disclosure of such information may violate state or federal law. If you are an unintended recipient of this e-mail, please delete it, without first saving or forwarding it, and, so that the DNR is aware of the mistake in sending it to you, contact Temple Davidson at 907- 269-8784 or temple.davidson@alaska.Rov. Davies, Stephen F (DOA) From: Diel, Bill [bdiel@blm.gov] Sent: Tuesday, November 13, 2012 9:07 AM To: Davies, Stephen F (DOA) Subject: Swanson River Field Steve, We have issues with our scanner so I'm not yet able to send a PDF of the pooling agreement for the Swanson River Field. The agreement permits pooling of all field production for allocation to the Swanson River unit and the Soldotna Creek unit and their respective participating areas. It was effective July 1, 1963. According to the agreement, consolidated operation of the entire Swanson River Field was deemed necessary for the most efficient and economic operation of a gas repressuring program to recover the maximum amount of unitized substances and prevent waste of natural resources. The agreement area comprises all existing participating areas of the Swanson River and Soldotna Creek units. Please call if you have additional questions. I'll send a PDF of the agreement as soon as the scanner issues is resolved. N1 Bill Diel Geologist BLM Alaska State Office Branch of Energy and Minerals 907-271-3232 907-271-3933 (fax) bdiel(a.blm.gov • Davies, Stephen F (DOA) From: David Duffy - (C) [dduffy@hilcorp.com] Sent: Thursday, November 08, 2012 4:53 PM To: Davies, Stephen F (DOA) Cc: Kevin Eastham; Kevin Tabler Subject: RE: Swanson River Field -Working Interest Agreement Area Exterior Boundary Line Attachments: Spacing Exception Rule Modification Request Swanson River CO 123A (FINAL).pdf; proof of mailing to CIRI 11-8-2012.pdf; proof of mailing to BLM 11-8-2012.pdf Hi Steve, Please see attached application to modify CO 123A by eliminating spacing exceptions within the Swanson River Field. This application is intended to replace the previous version submitted on October 24. This cleans up the erroneous reference to other Conservation Orders in the subject line, and better clarifies the "area" to which the CO rules apply. Call me with any questions — but I think this addresses your prior questions. Hardcopies are going out in tomorrow's mail. Certificates also attached. Regards, David Duffy, Landman Hilcorp Alaska, LLC 3800 Centerpoint Drive, Suite 100 Anchorage, Alaska 99503 Office: 907 777-8300 Direct: 907 777-8414 Fax: 907 777-8580 Email: dduffy@hilcorp.com This email may contain confidential and/or privileged information and is intended for the recipient(s) only. In the event you receive this message in error, please notify me and delete the message. From: Davies, Stephen F (DOA)[mailto•steve.davies@alaska.gov] Sent: Wednesday, November 07, 2012 4:30 PM To: David Duffy - (C) Subject: RE: Swanson River Field -Working Interest Agreement Area Exterior Boundary Line David, My work notes from 11/1 indicate that you planned to re -submit the spacing exception application for SCU 44-33 updated with a corrected title and exterior boundary reference. Did you ever get a chance to do so? Thanks, Steve Davies AOGCC From: Davies, Stephen F (DOA) Sent: Thursday, November 01, 2012 11:01 AM To: 'David Duffy - (C)' 0 0 Subject: RE: Swanson River Field -Working Interest Agreement Area Exterior Boundary Line David, Alternatively, would it be easier to delete reference to the SRF working Interest Agreement Exterior Boundary, and give reference to the combined boundaries of the Swanson River Unit and Soldotna Creek Unit? My request for a map of the Agreement Exterior Boundary is for the purpose of checking it against the current SRU / SCU exterior boundary. Updating the exterior boundary reference from the agreement boundary to the current SRU / SCU boundary would be best. Would you like to re -submit the application deleting the reference to CO 351 in the title and asking also to update the exterior boundary of the affected area to coincide with the current SRU / SCU boundary? Regards, Steve Davies Sr. Petroleum Geologist Alaska Oil and Gas Conservation Commission (AOGCC) Phone: 907-793-1224 Fax: 907-276-7542 From: David Duffy - (C) [mailto:dduffy(cbhilcorp.com] Sent: Wednesday, October 31, 2012 4:12 PM To: Davies, Stephen F (DOA) Subject: RE: Swanson River Field -Working Interest Agreement Area Exterior Boundary Line Steve - please see clip below from the 1964 Working Interest Agreement. The first recital gives reference to the combination of the Swanson River Unit Agreement and the Soldotna Creek Unit Agreement. My electronic version does not have a map. I'll need to do some more digging for you tomorrow in the archive. 2 • go Working :Utertit Afire 3/5/64 T '44AZDOM entered jut* *a 01' tt* Iar der 'e 'Tw V' '00 trwv ttt 3 tvtvven tale uzUr4igned owners of eezotald Tj. S. oil and ;60 le^ass twMring lAnds 0= tie Swats= IRIY#r Field, Xeras Pt.tiAzula, Al,*,zk*, tereix&rtor *&U#d "Parties"' and SCmatimes referred to as '%o;cLeAjr.5 10ater#tv Owners.' AIMME TALS The ftrUto t* this ogremesit MM' 411 of the Working '.Intertmtz 9 within the prttently knovs productive 11ults of tt.e Sw6rs,= :Ilv,#r 'FI*14# "0 which lite partly vitbin the area covoertl by the Swanz= River Volt Agree. maht, Xo. '4-08-cxI.2969, approved JUly 11, 1W, and partly within the art* 12 covered by the SoldotrA Creek 'wit Agremment, :to. 14- 8-W1- , approved 13 Deectmber 18, 1959, Utith Unit Agreemotta were estst�ljshed and which Unit 14 Arose are oper4tod p4rtuAtt to the Miters'. Leasing Act of %Iebruory 25. 19m, 't 5 41 Stat. 437, *6 czended, 30 U.S.C. 3,--tz. 161 at seq. 16 This agroment is entered 14tO to Perolt tte Vorklzg Zntorosta In 17 VW jortlotpatI.Ing a of the Sj*kanzon River Unit Area to be opor4tod Jointly Vith the Working Intorasts in the p*rt.,cIp4tj," arts& of the Soldoto4 Creek Unit ArOS within the Swanson fiver Field In order to affect press,,zro min- terAzte 604 it resat recovery of Unitited Su't-st4"asty =saza of tj$ OrA/or other fluid 'Injection optratiooz or other operations agreed upot by this 22 Partito and approved ty Oar Supervisor, r-rA to eatabl:sh otA operate .41o1rt 23 f4ollitits ours ray for sutb r4vretions. Tt to also tb# --arpoa# of Utz *;-s"-4ent to eotabltib erg msint*iz 25 a plan of o;eratioz which will 'permit the rtturcos of tiv Svensou River 26 T'Itld to be more properly cotservod and utilized, will prtyott tzAtrgrouod 27 waste- and vill permit the m*xAm= *a is recovery of' oil and gas fr= mm'.4 28 r1*14. 9 I also want to check the boundary asV995 (time CO 123A was issued). There A Pot been any unit boundary changes since then. Alternatively, would it be easier to delete reference to the SRF working Interest Agreement Exterior Boundary, and give reference to the combined boundaries of the Swanson River Unit and Soldotna Creek Unit? Regards, David Duffy, Landman Hilcorp Alaska, LLC 3800 Centerpoint Drive, Suite 100 Anchorage, Alaska 99503 Office: 907 777-8300 Direct: 907 777-8414 Fax: 907 777-8580 Email: dduffy@hilcorp.com This email may contain confidential and/or privileged information and is intended for the recipient(s) only. In the event you receive this message in error, please notify me and delete the message. From: Davies, Stephen F (DOA)[mailto:steve.davies@alaska.gov] Sent: Tuesday, October 30, 2012 4:42 PM To: David Duffy - (C) Subject: Swanson River Field -Working Interest Agreement Area Exterior Boundary Line Importance: High Can please you provide me with a map that shows the current Swanson River Field -Working Interest Agreement Area exterior boundary line that is referenced in Rule 5 of Conservation Order No. 123A? Thanks, Steve Davies AOGCC 907-793-1224 4 ii Ah C STATE OF ALASKA Mw NOTICE TO PUBLISHER W ADVERTISING ORDER NO. ADVERTISING INVOICE MUST BE IN TRIPLICATE SHOWING ADVERTISING ORDER NO., CERTIFIED /� 1 �OnC A0-02-3-4 GJ AFFIDAVIT OF PUBLICATION (PART 2 OF THIS FORM) WITH ATTACHED COPY OF ORDER ADVERTISEMENT MUST BE SUBMITTED WITH INVOICE SEE BOTTOM FOR INVOICE ADDRESS F AOGCC AGENCY CONTACT DATE OF A.O. November 20, 2012 R 333 W 7th Ave, Ste 100 Jody Colombie PHONE PCN ° Anchorage, AK 99501 M DATES ADVERTISEMENT REQUIRED: December 2, 2012 o Alaska Journal of Commerce 301 Arctic Slope Avenue, Suite 350 Anchorage AK 99518 THE MATERIAL BETWEEN THE DOUBLE LINES MUST BE PRINTED IN ITS ENTIRETY ON THE DATES SHOWN. SPECIAL INSTRUCTIONS: Type of Advertisement SEE ATTACHED CO-12-28 SEND INVOICE IN TRIPLICATE AOGCC 333 W. 7th Ave., Suite 100 PAGE 1 OF TOTAL OF ALL PAGES$ TO Anchorage, AK 99501 2 PAGES REF TYPE NUMBER AMOUNT DATE COMMENTS 1 VEN 2 ARD 1 02910 FIN AMOUNT SY CC PGM LC ACCT FYINMR DIST LID 1 12 02140100 73451 2 REQUISIT NE B t7 L DIVISION APPROVAL: 02-902 (R-L' W94) Publisher/Original Copies: Department Fiscal, Department, Receiving AO. FRM Notice of Public Hearing STATE OF ALASKA Alaska Oil and Gas Conservation Commission Re: Docket No. CO-12-28. The application of Hilcorp Alaska, LLC (Hilcorp) to amend Conservation Order No. 123A to remove intra-pool well spacing requirements for the Hemlock Oil Pool, Swanson River Unit, Swanson River Field, Kenai Peninsula Borough, Alaska Hilcorp, by application received October 25, 2012, requests the Alaska Oil and Gas Conservation Commission (AOGCC) issue an order that there shall be no restriction as to well spacing except that no wellbore may be open to test or regular production within 500 feet of the exterior boundary of the Hemlock Oil Pool, Swanson River Unit, Swanson River Field, Kenai Peninsula Borough, Alaska where ownership or landownership changes. Current spacing in the Hemlock Oil Pool allows up to two wells to be completed in any governmental quarter section, but no well may be completed less than 500 feet from the Swanson River Field -Working Interest Agreement Area exterior boundary line. Future drilling will include deviated or long, horizontal wells or well sections in the pool that target un-drained reserves contained in isolated fault blocks. Many of these projects could require spacing exceptions to allow the wells or well sections to be drilled to the desired area within the oil pool. Removing the intra-well spacing requirements will lessen the administrative burden for both Hilcorp and the AOGCC as development proceeds in this mature oil pool. Hilcorp is not proposing to change the setback distance from any external boundary where ownership or landownership may change. The AOGCC has tentatively scheduled a public hearing on this application for January 3, 2013 at 9:00 a.m. at the Alaska Oil and Gas Conservation Commission, at 333 West 7th Avenue, Suite 100, Anchorage, Alaska 99501. To request that the tentatively scheduled hearing be held, a written request must be filed with the AOGCC no later than 4:30 p.m. on December 18, 2012. If a request for a hearing is not timely filed, the AOGCC may consider the issuance of an order without a hearing. To learn if the AOGCC will hold the hearing, call 793-1221 after December 20, 2012. In addition, written comments regarding this application may be submitted to the Alaska Oil and Gas Conservation Commission, at 333 West 7` Avenue, Suite 100, Anchorage, Alaska 99501. Comments must be received no later than 4:30 p.m. on January 2, 2013, except that, if a hearing is held, comments must be received no later than the conclusion of the January 3, 2013 hearing. If, because of a disability, special accommodations may be needed to comment or attend the hearing, contact the AOGCC's Special Assistant, Jody Colombie, at 793-1221, no later than December 26, 2012. Cathy P. oerster Chair, C mmissioner • 0 RECEIVED ournalorcommerce Alaska Oil & Gas Conservation Commission Public Notices FILE NO: AO-02-3-14-025 4ri#• 10169943 AO-02-3-14-025 DEC 0 5 2012 AOGCC AFFIDAVIT OF PUBLICATION UNITED STATES OF AMERICA, STATE OF ATTACII PROOF OF PUBLICATION HERE ALASKA, THIRD DISTRICT BEFORE ME, THE Notice of Public Hearing UNDERSIGNED, A NOTARY PUBLIC THIS DAY PERSONALLY APPEARED Tracy Allison STATE OF ALASKA WHO, BEING FIRST DULY SWORN, Alaska Oil and Gas Conservation ACCORDING TO THE LAW, SAYS THAT HE IS Commission THE Circulation Manager OF THE ALASKA Re: Docket No. CO-12-28. The appti- JOURNAL OF COMMERCE PUBLISHED AT 301 cation of Hilcorp Alaska, LLC (Hit• ARTIC SLOPE AVENUE, SUITE 350, IN SAID Corp) to amend Conservation Order to remove infra -pool well THIRD DISTRICT AND STATE OF ALASKA spacing requirements for the Hemlock spacing r AND THAT ADVERTISEMENT, OF WHICH THE Oil Pool, Swanson River Unit, Swan - ANNEXED IS A TRUE COPY, WHICH WAS son River Field, Kenai Peninsula Bor- PUBLISHED IN SAID PUBLICATION ough, Alaska Hilcorp, by application received Octo- ber 25, 2012, requests the Alaska Oil 1 2/02/2012 and Gas Conservation Commission ( issue an order that there 2nd DAY OF DECEMBER 2012 shallhall be be no restriction as to well spac- ing except that no wellbore may be AND THERE AFTER FOR I open to test or regular production CONSECUTIVE W EEK(S) AND THE within 500 feet of the exterior bound - ary of the Hemlock Oil Pool, Swanson LAST PUBLICATION APPEARING ON River Unit, Swanson River Field, Ke- 12/02/2012 nai Peninsula Borough, Alaska where 2ncl DAY OF DECEMBER 2012 ownership or landownership changes. Current spacing in the Hemlock Oil r Pool allows up to two wells to be completed in any governmental quar- ter section, but no well may be com- pleted less than 500 feet from the Swanson River Field -Working Interest Tracy Allison Agreement Area exterior boundary Circulation Manager line. Future drilling will include devi- ated or long, horizontal wells or well sections in the pool that target THIS 3rd DAY OF December 2012 un-drained reserves contained in iso- lated fault blocks. Many of these pro- jects could require spacing exceptions to allow the wells or well sections to be drilled to the desired area within the oil pool. Removing the infra well spacing requirements will lessen the N TARY PUBLIC STATE OF ALASKA administrative burden for both Hilcorp and the AOGCC as development pro - Notary Public ceeds in this mature oil pool. Hilcorp BELINDA CUMMINGS is not proposing to change the set - State of Alaska back distance from any external boundary where ownership or land- My Commission Expires Jun 14, 2016 ownership may change. The AOGCC has tentatively scheduled Co ; eA, R(-b - a public hearing on this application for January 3, 2013 at 9:00 a.m. at the Alaska Oil and Gas Conservation Commission, at 333 West 7th Ave- nue, Suite 100, Anchorage, Alaska 99501. To request that the tentatively scheduled hearing be held, a written request must be filed with the AOGCC no later than 4:30 p.m. on December 18, 2012. If a request for a hearing is not timely filed, the AOGCC may consider the is- suance of an order without a hearing. To learn if the AOGCC will hold the hearing, call 793-1221 after Decem- ber 20, 2012. In addition, written comments regard- ing this application may be submitted to the Alaska Oil and Gas Conserva- tion Commission, at 333 West 7th Avenue, Suite 100, Anchorage, Alaska 99501. Comments must be received no later than 4:30 p.m. on January 2, 2013, except that, if a hearing is held, comments must be received no later than the conclusion of the January 3, 2013 hearing. If, because of a disability, special ac- commodations may be needed to comment or attend the hearing, con- tact the AOGCC's Special Assistant, Jody Colombie, at 793-1221, no later than December 26, 2012, By:/s/Cathy P. Foerster Chair, Commissioner Pub:12/02/2012. Ad#10169943 0 0 STATE OF ALASKA NOTICE TO PUBLISHER ADVERTISING ORDER NO. ADVERTISING INVOICE MUST BE IN TRIPLICATE SHOWING ADVERTISING ORDER NO., CERTIFIED /f, O_o2_3_14-025 AFFIDAVIT OF PUBLICATION (PART 2 OF THIS FORM) WITH ATTACHED COPY OF / ORDER ADVERTISEMENT MUST BE SUBMITTED WITH INVOICE F I AOGCC R 1333 West 7t' Avenue. Suite 100 o Anchorage_ AK 99501 M o Alaska Journal of Commerce 301 Arctic Slope Avenue, Suite 350 Anchorage AK 99518 United states of America State of division. CONTACT PHONE 17 1/ 1 /7l -1GG1 DATES ADVERTISEMENT REQUIRED: December 2, 2012 DATE OF A.O. PCN THE MATERIAL BETWEEN THE DOUBLE LINES MUST BE PRINTED IN ITS ENTIRETY ON THE DATES SHOWN. SPECIAL INSTRUCTIONS: AFFIDAVIT OF PUBLICATION REMINDER ss INVOICE MUST BE IN TRIPLICATE AND MUST REFERENCE THE ADVERTISING ORDER NUMBER. A CERTIFIED COPY OF THIS AFFIDAVIT OF PUBLICATION MUST BE SUBMITTED WITH THE INVOICE. Before me, the undersigned, a notary public this day personally appeared ATTACH PROOF OF PUBLICATION HERE. who, being first duly sworn, according to law, says that he/she is the of Published at in said division and state of and that the advertisement, of which the annexed is a true copy, was published in said publication on the day of 2012, and thereafter for consecutive days, the last publication appearing on the day of . 2012, and that the rate charged thereon is not in excess of the rate charged private individuals. Subscribed and sworn to before me This _ day of 2012, Notary public for state of My commission expires _ r �J • Colombie, Jody J (DOA) From: Colombie, Jody J (DOA) Sent: Wednesday, November 21, 2012 9:52 AM To: Ballantine, Tab A (LAW); 'Angela Singh'; Bettis, Patricia K (DOA); 'Brooks, Phoebe'; Colombie, Jody J (DOA); Crisp, John H (DOA); Davies, Stephen F (DOA); Ferguson, Victoria L (DOA); Fisher, Samantha J (DOA); Foerster, Catherine P (DOA); Grimaldi, Louis R (DOA); Johnson, Elaine M (DOA); Jones, Jeffery B (DOA); Laasch, Linda K (DOA); 'Makana Bender'; McIver, Bren (DOA); McMains, Stephen E (DOA); Mumm, Joseph (DOA sponsored); Noble, Robert C (DOA); Norman, John K (DOA); Okland, Howard D (DOA); Paladijczuk, Tracie L (DOA); Pasqual, Maria (DOA); Regg, James B (DOA); Roby, David S (DOA); Scheve, Charles M (DOA); Schwartz, Guy L (DOA); Seamount, Dan T (DOA); 'Wallace, Chris (DOA sponsored)';'(michael.j.nelson @conocophiIlips. com)'; 'AKDCWelllntegrityCoordinator'; 'alaska@petrocalc.com'; 'Alexander Bridge'; 'Anna Raff; 'Barbara F Fullmer'; 'bbritch'; 'Becky Bohrer'; 'Bill Penrose'; 'Bill Walker'; 'Bowen Roberts'; 'Bruce Webb'; 'caunderwood'; 'Claire Caldes'; 'Cliff Posey'; 'Crandall, Krissell'; 'D Lawrence'; 'Daryl J. Kleppin'; 'Dave Harbour'; 'Dave Matthews'; 'David Boelens'; 'David Duffy'; 'David House'; 'David Scott'; 'David Steingreaber'; 'Davide Simeone'; 'ddonkel@cfl.rr.com'; 'Elowe, Kristin'; 'Francis S. Sommer'; 'Gary Laughlin'; 'Gary Schultz (gary.schultz@alaska.gov)'; 'ghammons'; 'Gordon Pospisil'; 'Gorney, David L.'; 'Greg Duggin'; 'Gregg Nady'; 'Gregory Geddes'; 'gspfoff; 'Jdarlington Qarlington@gmail.com)'; 'Jeanne McPherren'; 'Jeffery B. Jones Qeff.jones@alaska.gov)'; 'Jerry McCutcheon'; 'Jill Womack'; 'Jim White'; 'Jim Winegarner'; 'Joe Lastufka'; 'Joe Nicks'; 'John Easton'; 'John Garing'; 'John Spain'; 'Jon Goltz'; Jones, Jeffrey L (GOV); 'Judy Stanek'; 'Julie Houle'; 'Julie Little'; 'Karl Moriarty'; 'Kaynell Zeman'; 'Keith Wiles'; 'Kelly Sperback'; 'Laura Silliphant (laura.gregersen@alaska.gov)'; 'Luke Keller'; 'Marc Kovak'; 'Mark Dalton'; 'Mark Hanley (mark.hanley@anadarko.com)'; 'Mark P. Worcester'; 'Marquerite kremer (meg.kremer@alaska.gov)'; 'Michael Jacobs'; 'Mike Bill'; 'Mike Mason'; 'Mike Morgan'; 'Mike) Schultz'; Mindy Lewis; MJ Loveland; mjnelson; mkm7200; nelson; Nick W. Glover; NSK Problem Well Supv; Patty Alfaro; Paul Decker (paul.decker@alaska.gov); 'Paul Mazzolini'; Randall Kanady; Randy L. Skillern; 'Randy Redmond'; 'Rena Delbridge'; 'Renan Yanish'; 'Robert Brelsford'; Robert Campbell; 'Ryan Tunseth'; Scott Cranswick; 'Scott Griffith'; Shannon Donnelly; Sharmaine Copeland; Shellenbaum, Diane P (DNR); Slemons, Jonne D (DNR); Sondra Stewman; 'Stephanie Klemmee; Steve Moothart (steve.moothart@alaska.gov); Steven R. Rossberg; 'Suzanne Gibson'; Tamera Sheffield; 'Taylor, Cammy O (DNR)'; Temple Davidson; Teresa Imm; Thor Cutler; 'Tim Mayers'; Tina Grovier; Todd Durkee; Tony Hopfinger; trmjrl; Vicki Irwin; Walter Featherly; Yereth Rosen; 'Aaron Gluzman'; 'Aaron Sorrell'; 'Bruce Williams'; Bruno, Jeff J (DNR); Casey Sullivan; 'Dale Hoffman'; David Lenig; 'Donna Vukich'; Eric Lidji; Erik Opstad; Franger, James M (DNR); 'Gary Orr'; 'Graham Smith'; 'Greg Mattson'; Heusser, Heather A (DNR); 'James Rodgers'; 'Jason Bergerson'; Jennifer Starck; 'Jill McLeod'; 'Joe Longo'; King, Kathleen J (DNR); 'Lara Coates'; Lois Epstein; Marc Kuck; 'Marie Steele'; 'Matt Gill'; Melissa Okoola; 'Ostrovsky, Larry Z (DNR)'; 'Patricia Bettis'; Perrin, Don J (DNR); Peter Contreras; Pexton, Scott R (DNR); Richard Garrard; 'Ryan Daniel'; 'Sandra Lemke'; Talib Syed; Terrace Dalton; 'Wayne Wooster'; 'Wendy Wollf; 'William Hutto'; 'William Van Dyke' Subject: Public Hearing Notice Swanson River Unit Attachments: Public Hearing Notice (SRU).pdf Jody J. Colombie Special Assistant Alaska Oil and Gas Conservation Commission 333 West 7th Avenue Anchorage, AK 9.9501 (907)793-1221 (phone) (907)276-7542 (fax) i Easy Peel® Labels i ® Bend along line to Use. every ® Template 51600 i �d Paper ® expose Pop-up EdgeT- � Mary Jones David McCaleb XTO Energy, Inc. IHS Energy Group Cartography GEPS 810 Houston St., Ste. 200 5333 Westheimer, Ste.100 Ft_ Worth, TX 76102-6299 Houston, TX 77056 Jerry Hodgden Richard Neahring Hodgden Oil Company NRG Associates 408181" St. President Golden, CO 80401-2433 P.O. Box 1655 Colorado Springs, CO 80901 Bernie Karl CIRI K&K Recycling Inc. Land Department P.O. Box 58055 P.O. Box 93330 Fairbanks, AK 99712 Anchorage, AK 99503 North Slope Borough Richard Wagner Planning Department P.O. Box 60868 P.O. Box 69 Fairbanks, AK 99706 Barrow, AK 99723 Jack Hakkila Darwin Waldsmith P.O. Box 190083 P.O. Box 39309 Anchorage, AK 99519 Niniichik, AK 99639 Penny Vadla 399 W. Riverview Ave. Soldotna, AK 99669-7714 A%MRY@) 5960TM George Vaught, Jr. P.O. Box 13557 Denver, CO 80201-3557 Mark Wedman Halliburton 6900 Arctic Blvd. Anchorage, AK 99502 Baker Oil Tools 795 E. 94!' Ct. Anchorage, AK 99515-4295 Gordon Severson 3201 Westmar Or. Anchorage, AK 99508-4336 James Gibbs P.O. Box 1597 Soldotna, AK 99669 JIa ry. kicluettes faciles a peler ; Replies a la hachure afro de ; WWw.ave [ORi 1 Sens de we � R_unn_rrs_nvFav #2 Hilcorp Alaska, LLC November 8, 2012 Cathy Foerster, Chair Alaska Oil and Gas Conservation Commission 333 West 7`h Avenue, Suite 100 Anchorage, Alaska 99501 RECEIVED NOV 13 2012 AOGCC Post Office Box 244027 Anchorage, AK 99524-4027 3800 Centerpoint Drive Suite 100 Anchorage, AK 99503 Phone:907/777-8300 Fax: 907/777-8301 RE: (Revised) Proposed Second Amendment to Conservation Order No. 123A Dear Commissioner Foerster, This letter supersedes the application submitted on October 24, 2012. HilcoT Alaska, LLC ("Hilcorp"), as Operator, respectfully requests administrative action be taken by the Commission to eliminate well spacing requirements within 500 feet from the exterior boundary of the Swanson River Field, and also to clarify the area to which such rules apply. Rule No. 5 of Conservation Order No. 123A (August 23, 1773, as amended, December 5, 1995) currently limits the number of wells in any given governmental quarter section to two (2) wells. The proposed amendment is as follows: Rule 5: Spacing Net mefe d two eemp eted wells afe a4lowed in any- gee=emmental nu aAe_ see-tien. There shall be no restriction as to well spacing except that no No well shall be completed less than 500 feet from the Swanson River- Field Working 1n4er-est Agreement Afe exterior boundary line of the Swanson River Field, as defined in Rule 2. The Swanson River Field is a mature field with a complex administrative history. Discovery occurred in 1957, followed by development and first production in 1958. To date, 126 development and service wells have been drilled. The field consists of two federally -administered units, the Swanson River Unit and the Soldotna Creek Units, which were consolidated into a single operating area in 1964. See Conservation Order 123, Rule 2 (1973). This same definition of the Swanson River Field was utilized in 1995, when the order was amended to expand the Tyonek G-zone and Lower Hemlock intervals to the Hemlock Oil Pool. See Conservation Order 123A, Rule 2 (1995). 1 Conservation Order 123A, Rule 7 (Administrative Approval) provides that "[ulpon request of the Operator and showing that all affected parties have been notified of such request, the Committee may authorize any operation reasonably designed to further the progress of the project and maximize the recovery of oil from the Hemlock Oil Pool in the Swanson River Field." Swanson River Field 0 (Revised) Proposed Conservation Order Amendment November 8, 2012 Page 2 of 3 As currently drafted, Rule 2 describes the area to which applicable rules apply in both geographic terms ("the combined area of the Swanson River and Soldotna Creek Units") and by legal descriptions (i.e., metes and bounds). However, both the 1973 and current 1995 version of Rule 3 also define the Hemlock Oil Pool stratig_raphically as "...all intervals which correlate with the interval 10,085 feet to 10,815 feet in the Stand Oil Company of California, Soldotna Creek unit 41-4 well." In order to give clear meaning to the 500 foot well spacing buffer required by Rule 5, Hilcorp proposes to clarify the definition of the "Swanson River Field" as follows: Rule 2: Area to Which these Rules apply These rules apply throughout the Swanson River Field, which is comprised of the combined area of the Swanson River and Soldotna Creek Units, as illustrated on Exhibit A. [delete remainder of text (legal descriptions)] These proposed amendments will not impact the stratigraphic definition of the Hemlock Oil Pool, as stated in Conservation Order 123A, Rule 3 (1995). However, they will clarify that the 500 foot buffer required by Rule 5 applies to all wells and all horizons within the Swanson River Field, and eliminate any erroneous reference that such spacing rules only apply to wells targeting production from the Hemlock Oil Pool. Finally, Hilcorp proposes to amend Rule 7 (Administrative Approval), as follows: Rule 7: Administrative Approval Upon the request of the Operator and a showing that all affected parties have been notified of such request, the Committee Commission may authorize any operation reasonable designed to further the progress of the project and maximize the recovery of oil and all other hydrocarbons from the uomieek Oil Pool in the Swanson River Field. Moreover, the Operator shall promptly file updates to Exhibit A, as referenced herein at Rule 2, immediately following any administrative change of affecting the boundaries of the Swanson River Unit and/or the Soldotna Creek Unit. This amendment is necessary for current and future administrative housekeeping purposes. The proposed changes make clear that Conservation Order 123 applies to the entire Swanson River Field, and is not limited exclusively to the Hemlock Oil Pool. It also provides a reasonable mechanism for the Commission to be timely informed of any unit boundary changes of this federally -administered field. Collectively, the proposed Swanson River Field 0 (Revised) Proposed Conservation Order Amendment November 8, 2012 Page 3 of 3 amendments serve to prevent waste, protect correlative rights and improve the ultimate recovery of remaining hydrocarbons from the Swanson River Field.2 If you require additional information regarding this request, please contact Mr. Luke Kevin Eastham. Sr. Geologist at 777-8386, or you may contact the undersigned at 777- 8414. Sincerely, _ David W. Duffy Hilcorp Alaska, LLC Enclosures: Exhibit A; Certified mailing receipts CC: BLM CIRI 2 See Conservation Order 123A, Conclusion No. 2. Exhibit A Swanson River Field Swanson River Unit and Soldotna Creek Unit 6 4 3 2 1 A02 405 7 $ 11 12 17 A02 1077 18 17 13 15 6 14 1 2 A02838 - Swanson River Unit 9W Block 1 19 20 21 22 23 - 18 A028406 30 29 27 A02 39 A02�990 BNSVti 31 AO 8396 32 35 36 3 9 Soldotna Creek Unit Block 2 16 � 15 A028997 A028996 7N9 9 10 u Leases Unit Tracts A 29 2 12 18 CIR 5810 17 6 993 15 14 March 1, 2012 14 Scale: 2 :62,000 Hilcorp Alaska, LLC C ■ Complete items 1, 2. and 3. Also complete Item 4 if Restricted Delivery is desired, ■ Print your name and address on the reverse so that we can return the card to you. • Attach this card to the back of the maifpiece, or on the front if space permits. �. Article Addressed to: Ethan Schutt, Senior Vice President Land Energy Cook Inlet Region, Inc. 2525 C Street, Suite 500 Anchorage, AK 99503 2. Article Number (Transfer barn service label) PS Form 381 1. August 2001 A Sgr.4ture ❑ Agent t X I G`'. _ _ � t���",t'` 0 Addressee B. ReAeived by( PgPted Name) C. Date of Delivery f l D. Is delivery address different from item 1? 0 Yes If YES, enter delivery address below: ❑ No 3. Service Type 0 Certified Mail ❑ Express Mail ❑ Registered 0 Return Receipt for Merchandise ❑ insured Mail ❑ C.O.D. 1 4 Restricted Delivery? (Extra Feel 7001 n-320 0005 5886 9462 Donicsi,c Return Receipt • Complete items 1, 2, and 3. Also complete item 4 if Restricted Delivery is desired. 19 Print your name and address on the reverse so that we can return the card to you. ■ Attach this card to the back of the maifpiece, or on the front if space permits. 1. Article Addressed to: Wayne M. Svejnoha Branch Chief of Energy and Minerals Bureau of Land Management 222 West 7th Avenue, #13 Anchorage, AK 99513 ❑ Yes 102595-01-M-2509 © Anent _ 0 Addressee &` C. Date of Delivery D. Is delidifferent from item 1? 0 Yes If YES, enter delivery address below- ❑ No 3. Service Type ❑ Certified Mail 0 Express Mail 0 Registered ❑ Return Receipt for Merchandise ❑ Insured Mail 0 C.O.D- 4. Restricted Delivery? (Extra Fee) 0 Yes 2- Article Number 55h6 9995 5000 02E0 T004 (Transfer From service label) PS Form 3811, February 2004 Domestic Return Receipt 102595-02-W I W Post Office Box 244027 Anchorage, AK 99524-4027 Hilcorp Alaska, LLC 3800 Centerpoint Drive Suite 100 Anchorage, AK 99503 Phone: 907/777-8300 Fax: 907/777-8301 October 24, 2012 Cathy Foerster, Chair a { Alaska Oil and Gas Conservation Commission I 333 West 7u' Avenue, Suite 100 OCT 22012 Anchorage, Alaska 99501 AOGCC RE: Proposed Second Amendment to Conservation Order No. 123A, Swanson River Field; Proposed First Amendment to Conservation Order No. 351. Dear Commissioner Foerster, Hilcorp Alaska, LLC ("Hilcorp"), as Operator of the Swanson River Field, hereby requests administrative action be taken by the Commission to eliminate well spacing requirements within the boundary of the Swanson River Field, Hemlock Oil Pool, yet maintain the 500 feet setback from the exterior boundary of the Swanson River Field.' This action is necessary to maximize recovery from this mature field. Approval of this proposed amendment will reduce filings associated with future spacing exceptions and will result in administrative efficiencies for both the Operator and the Commission. Pool Rule No. 5 of Conservation Order No. 123A, Swanson River Field, Hemlock Oil Pool (August 23, 1773, as amended, December 5, 1995) currently limits the number of wells in any given governmental quarter section to two (2) wells. The proposed amendment is as follows: Rule 5: Spacing No more than two eempleted wells are allowed in any gevet:mnental quai4er- seefien. There shall be no restriction as to well spacing except that no No well shall be completed less than 500 feet from the Swanson River Field - Working Interest Agreement Area exterior. The Hemlock Oil Pool includes all intervals which correlate with the interval 10,085 feet to 10,815 feet in the Soldotna Creek unit ("SCU") 41-4 well. This pool was first established by Conservation Order No. 123 on August 23, 1973. On December 5, 1995, the Commission expanded the Hemlock Oil Pool to include the G zone of the Tyonek ' Conservation Order 123A, Rule 7 (Administrative Approval) provides that "[u]pon request of the Operator and showing that all affected parties have been notified of such request, the Committee may authorize any operation reasonably designed to further the progress of the project and maximize the recovery of oil from the Hemlock Oil Pool in the Swanson River Field." Swanson River Field Proposed Conservation Order Amendment October 10, 2012 Page 2 of 2 Formation and the lower portion of the Hemlock Formation.2 The purpose of this expansion was to "prevent waste, protect correlative rights and improve ultimate recovery from the Swanson River Field."3 The Swanson River Field is a mature field Discovery occurred in 1957, followed by development and first production in 1958. To date, 126 development and service wells have been drilled to the pool. Hilcorp estimates that the remaining reserves available from the pool cannot be captured through continued reliance on existing wellbores and unit infrastructure. Hilcorp's current development program seeks to maximize remaining reserves by targeting un-drained portions of the pool that cannot be reached by wells conforming to current spacing restrictions. Less restrictive spacing requirements will help to maximize recovery from this faulted and stratigraphically variable pool, while allowing for continued production from established development wells. Retention of the existing 500 foot buffer from the external boundary of the Swanson River Field will protect the correlative rights of adjoining or nearby property owners. If you require additional information regarding this request, please contact Mr. Kevin Eastham, Senior Geologist, at 777-8316, or you may contact the undersigned at 777- 8414. Sincerely, David W. Duffy Hilcorp Alaska, LLC cc: BLM CIRI 2 The Tyonek G zone is a predominantly sandstone interval within the Tyonek Formation that immediately overlies the Hemlock Formation and corresponds to the 10,085 foot to 10,230 foot measured depth interval in the SCU 4-4 well. Two discrete sandstones are present in the interval; the upper sandstone is designated in the G I sand and the lower G2 sand. See C.O. 124A, Finding No. 1. 31d. at Conclusion No. 2.
