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212-101
TI IE STATE 01ALASKA GOVERNOR MICHAEL J. DUNLEAVY August 23, 2019 Mr. Pat Galvin General Council Great Bear Petroleum Operating LLC 3705 Arctic Blvd, Suite 2324 Anchorage, AK 99503 Dear Mr. Galvin: Alaska Oil and Gas Conservation Commission 333 West Seventh Avenue Anchorage, Alaska 99501-3572 Main: 907.279.1433 Fax: 907.276.7542 w .aogcc.olaska.gov According to AOGCC records, Great Bear Petroleum Operating LLC has three permitted onshore wellheads that have been properly plugged and abandoned, but the well locations have not been cleared in accordance with 20 AAC 25.170 (see enclosed list). For all wells on the list, please arrange clearance inspections by submitting an AOGCC Test Witness Notification form before December 1, 2019. This form is available online at the AOGCC website: hLtp://doa.alaska.gov/ogc/forms/TestWitnessNotif.htini If you have any questions, please contact Ms. Jody Colombie at 907-793-1221 or iodv.colombie(@alaska eov or Mr. Dave Roby at 907-793-1232 or dave.roby@a,alaska.gov . Sincerely, Daniel T. Se ount, Jr. Je Ie L. Chmielowski Commissioner mmissioner Enclosure: List of Permitted Wellheads without Location Clearance Inspections Alaska Oil and Gas Conservation Commi3:5on Great Bear Petroleum Operating LLC *EXPLORATORY 12120570 50-223-20026-00-00 ALCOR 1 – -- -- — *EXPLORATORY 2012-08-11 – P&A 2017-11-17 Loc Ready For inspect 212101050-223-20027 00-00 MERAK 1 012-10-16 P&A – — 12 I 16 Loc Ready For Inspect *EXPLORATORY 2181740 50-103-20796-00-00 WINX 1 2019-03-17 _ IP&A _017-11 12019-03-17 '.Loc Readv Forinsoect Location Clearance 7/24/2019 Page 1 of 1 • STATE OF ALASKA • ECEI ALASKA OIL AND GAS CONSERVATION COMMISSION WELL COMPLETION OR RECOMPLETION REPORT AN6 L®GJ1? 1 a.Well Status: Oil ❑ Gas❑ SPLUG ❑ Other ❑ Abandoned 2 • Suspended❑ 1 b.Well Clas 20AAC 25.105 20AAC 25.110 Developmen GC()tory ❑✓ GINJ ❑ WINJ ❑ WAGE WDSPL❑ No.of Completions: Service ❑ Stratigraphic Test ❑ 2.Operator Name: 6. Date Comp.,Susp.,or 14. Permit to Drill Number/ Sundry: t L. Great Bear Petroleum Operating LLC (H0;6a.. 11/16/2017 * • 212-101 /-3 I-3- --1�S i 3.Address: 7. Date-Spudded: 15.API Number: 601 W.5th Avenue Suite 505,Anchorage AK 99501 8/22/2012 50-223-20027-00-00 • 4a. Location of Well (Governmental Section): 8. Date TD Reached: 16.Well Name and Number: Surface: 5009' FEL,44' FSL,Sec 8,T7N, R14, UM . 10/5/2012 Merak#1 • Top of Productive Interval: 5078'FEL, 136' FSL,Sec 8,T7N, R14E,UM 9. Ref Elevations: KB: 196 - 17. Field/Pool(s): C GL:j f( L- 175 . Exploration Total Depth: 5140'FEL,267' FSL,Sec 8,T7N, R14E, UM 10. Plug Back Depth MD/TVD: 18. Property Designation: Surface ADL 391706 • 4b. Location of Well (State Base Plane Coordinates, NAD 27): 11.Total Depth MD/TVD: 19. DNR Approval Number: Surface: x- 661,410.35 • y- 5,839,739.79 Zone- 4 - 11,094MD, 11,081"TVD ' LONS 11-007 TPI: x- 661,341.35 y- 5,839,831.79 Zone- 4 12.SSSV Depth MD/TVD: 20.Thickness of Permafrost MD/TVD: Total Depth: x- 661279.35 y- 5839962.79 Zone- 4 N/A 1680'MD, 1680'TVD • 5. Directional or Inclination Survey: Yes H (attached) No 2 - 13.Water Depth, if Offshore: 21. Re-drill/Lateral Top Window MD/TVD: Submit electronic and printed information per 20 AAC 25.050 N/A (ft MSL) N/A 22. Logs Obtained: List all logs run and, pursuant to AS 31.05.030 and 20 AAC 25.071,submit all electronic data and printed logs within 90 days of completion,suspension,or abandonment,whichever occurs first.Types of logs to be listed include,but are not limited to: mud log,spontaneous potential, gamma ray,caliper, resistivity,porosity, magnetic resonance,dipmeter,formation tester,temperature,cement evaluation,casing collar locator,jewelry,and perforation record. Acronyms may be used.Attach a separate page if necessary % ,JA' 9 0 2018 23. CASING, LINER AND CEMENTING RECORD WT. PER SETTING DEPTH MD SETTING DEPTH TVD AMOUNT CASING FT. GRADE TOP BOTTOM TOP BOTTOM HOLE SIZE CEMENTING RECORD PULLED 20" 129.45# X-56 Surf 93' Surf 93' 26" Grouted to surface 0' 13-3/8" 68# L-80 Surf 2,447' Surf 2,447' • 16" 361 bbls Lead,82 bbls Tail 0' 9-5/8" 47# L-80 Surf 8,727' Surf 8,721' 12-1/4" 556 bbls Lead,78 bbls Tail 0' 2nd stage 160 bbls 24.Open to production or injection? Yes ❑ No Q . 25.TUBING RECORD If Yes, list each interval open (MD/TVD of Top and Bottom; Perforation SIZE DEPTH SET(MD) PACKER SET(MD/TVD) Size and Number; Date Perfd): N/A N/A N/A •1305AK1PDU EP eeIttftEtterft 26.ACID, FRACTURE,CEMENT SQUEEZE, ETC. DATE Was hydraulic fracturing used during completion? Yes❑ No ❑� . -J J2ty L2 Per 20 AAC 25.283(i)(2)attach electronic and printed information VERIFIED DEPTH INTERVAL(MD) AMOUNT AND KIND OF MATERIAL USED 1..,(-- N/A 27. PRODUCTION TEST Date First Production: Method of Operation (Flowing,gas lift,etc.): Date of Test: Hours Tested: Production for Oil-Bbl: Gas-MCF: Water-Bbl: Choke Size: Gas-Oil Ratio: Test Period —0. Flow Tubing Casino Press: Calculated Oil-Bbl: Gas-MCF: Water-Bbl: Oil Gravity-API (corr): Press. 24-Hour Rate — Form 10-407 Revised 5/2017 ,..00 IL_ i CONTINUED ON PAGE 2 -73 vi [ 2017 Submi ORIGINIAL only • • 28.CORE DATA Conventional Core(s): Yes ❑ No El • Sidewall Cores: Yes ❑ No Q If Yes,list formations and intervals cored(MD/TVD,From/To),and summarize lithology and presence of oil,gas or water(submit separate pages with this form, if needed).Submit detailed descriptions,core chips,photographs,and all subsequent laboratory analytical results per 20 AAC 25.071. 29. GEOLOGIC MARKERS (List all formations and markers encountered): 30. FORMATION TESTS NAME MD TVD Well tested? Yes ❑ No 0 See already submitted"Merak#1 If yes,list intervals and formations tested,briefly summarizing test results. "Merak#1 Geologic Tops" Attach separate pages to this form,if needed,and submit detailed test information,including reports,per 20 AAC 25.071. Formation at total depth: Ivishak 31. List of Attachments: Information to be attached includes,but is not limited to:summary of daily operations,final wellbore schematic,Abandonment pictures per 20 AAC 25.070. 32. I hereby certify that the foregoing is true and correct to the best of my knowledge. Authorized Name: Patrick Galvin Contact Name: Tim Flynn Authorized Title: Chief Comercial Officer Contact Email: tlm.fI nn@ak-dc.com Authorized Contact Phone: 907 317 5504 Signature: Date:12/13/2017 INSTRUCTIONS General: This form and the required attachments provide a complete and concise record for each well drilled in Alaska. Submit a well schematic diagram with each 10-407 well completion report and 10-404 well sundry report when the downhole well design is changed.All laboratory analytical reports regarding samples or tests from a well must be submitted to the AOGCC,no matter when the analyses are conducted. Item la: Multiple completion is defined as a well producing from more than one pool with production from each pool completely segregated.Each segregated pool is a completion. Item 1 b: Well Class-Service wells:Gas Injection,Water Injection,Water-Alternating-Gas Injection,Salt Water Disposal,Water Supply for Injection, Observation,or Other. Item 4b: TPI (Top of Producing Interval). Item 9: The Kelly Bushing,Ground Level,and Base Flange elevations in feet above Mean Sea Level.Use same as reference for depth measurements given in other spaces on this form and in any attachments. Item 15: The API number reported to AOGCC must be 14 digits(ex:50-029-20123-00-00). Item 19: Report the Division of Oil&Gas/Division of Mining Land and Water:Plan of Operations(LO/Region YY-123),Land Use Permit(LAS 12345), and/or Easement(ADL 123456)number. Item 20: Report measured depth and true vertical thickness of permafrost.Provide MD and TVD for the top and base of permafrost in Box 29. Item 22: Review the reporting requirements of 20 AAC 25.071 and,pursuant to AS 31.05.030,submit all electronic data and printed logs within 90 days of completion,suspension,or abandonment,whichever occurs first. Item 23: Attached supplemental records should show the details of any multiple stage cementing and the location of the cementing tool. Item 24: If this well is completed for separate production from more than one interval(multiple completion),so state in item 1,and in item 23 show the producing intervals for only the interval reported in item 26.(Submit a separate form for each additional interval to be separately produced, showing the data pertinent to such interval). Item 27: Method of Operation: Flowing,Gas Lift,Rod Pump,Hydraulic Pump,Submersible,Water Injection,Gas Injection,Shut-in,or Other(explain). Item 28: Provide a listing of intervals cored and the corresponding formations,and a brief description in this box. Pursuant to 20 AAC 25.071,submit detailed descriptions,core chips,photographs,and all subsequent laboratory analytical results,including,but not limited to:porosity, permeability,fluid saturation,fluid composition,fluid fluorescence,vitrinite reflectance,geochemical,or paleontology. Item 30: Provide a listing of intervals tested and the corresponding formation,and a brief summary in this box. Submit detailed test and analytical laboratory information required by 20 AAC 25.071. Item 31: Pursuant to 20 AAC 25.070,attach to this form:well schematic diagram,summary of daily well operations,directional or inclination survey,and other tests as required including,but not limited to:core analysis,paleontological report,production or well test results. Form 10-407 Revised 5/2017 Submit ORIGINAL Only Ste.5 8eir Q 601 h 5th Ave,99501 5 0(907)868-807091 Anchorage,AK 99501 Q(907)891-9700 6r& t y C ,t O www.greatbearpetro.com m I R O L E U M December 14, 2017 RECEIVED Alaska Oil and Gas Conservation Commission DEC 1 4 2017 333 West 7th Avenue, Suite 100 Anchorage, AK 99501 AOGCC RE: 10-407 Well Completion Report: Merak #1 PTD 212-101 Dear Commissioner: Great Bear Petroleum hereby submits the 10-407 Well Completion Report for the permanent abandonment of Merak #1, permit to drill 212-101 . Merak #1 was spud on 8/22/2012, with a total depth of 11,049'MD reached on 10/05/2012. Abandonment of Merak #1 was completed on 11/16/2017. Pertinent information attached to this report includes the following: 1 . Form 10-407 Well Completion Report 2. Final Wellbore Schematic 3. Daily Operations Summary 4. Final Abandonment Photos If you have any questions or require additional information, please contact myself at 907-868- 8070, or Tim Flynn at 907-317-5504. Sincerely yours, Great Bear Petroleum Patrick S. Galvin Chief Commercial Officer & General Counsel 1 • • Merak #1 Final Abandonment OW 6rmt eur y_ HZOLEUM FT:T Pumed 46.0 bbls of 15.8 ppg 20"130#X-52 Conductor @ +/-93'MD/TVD cement down OA and up IA " ;.- Perferations @ 330'MD - Perferations @ 400'MD Port Collar+/-500'MD 1: [> 4 :1 Bridge Plug set @ 410'MD Never opened downhole 0 A I: '1 l. < Topof1'/I'coil fish:450'MD I, I: <I Base of Permafrost @ 1680'MD I` { Max Hole Inclination I:': l 16"Surface Hole Through Surface Hole<2 deg°Inc i Calc.TOC @ 2330'MD V Type P ES Stage Tool wl 18.5 bbls @ 15.8 ppg I b • Packer @ 2400'MD = 13-3/8"68#L-80 BTC Casing @ Mechanical Bridge Plug set @I` I iel +/-2441'MD,2441'TVD 2560'MD I ' I I I I I I I I I rt-- 12-1/4"Intermediate Hole I I Calc.TOC @4600'MD )l;; . J :1 :1 i k= Li t:: -4-7-= +/-827'of abandoned 2-7/8"6.5#L80 g* •,1 EUE 8RD Tubing .1 1 4 Calc.TOC @ 8582'MD f 14 9-5/8"47#L-80 BTC Casing @ I +/-8726'MD,8731'TVD . I :I I :; � �I I ::1 I -. .-.-,1 I:•: ::• 1 I:-. ' :I I.,: 1 I :I I :: 8-3/4"Hole filled with Cement F/11,094'MD up to 8,582'MD 1 A 01,;.5,;-=-,.--..;,...;:; <0 1 fic %f 4--- 8-'/<'Hole Of- Drilling •`� ,�. Completions µ Merak#1 TD @ 11,094'MD,11,081'TVD ' November 28, 2017 411 S Merak #1 Daily OperationsSummary Appt GIlAtglAl" API: 50-223-20027-00-00 Permit #: 212-101 Rig: Halliburton Coil Tubing Date and work completed as of 24:00 hours. Activity 30 October 2017 Men on location, Rig up,set equipment 0' 31 October 2017 Continue Rig Up. Met with Field AOGCC Rep. in Deadhorse and reviewed 0' operations 01 November 2017 Continue Rig Up coil tubing unit. Notified AOGCC of delay due to DOT 0' permits. 02 November 2017 Continue Rig Up coil tubing unit.AOGCC representative onsite to inspect site. 0' 03 November 2017 Shell test tree against 2-way check to 2500psi, R/U circulating line from IA to 0' tanks, rig up lines from OA to test w/state rep present. Discovered OA valve 14§J1 connection on wellhead damaged from ice,Tested tree with state rep witness to 1850psi....good, pull 2-way check test tubing kill string to 1500psi, "v""�' no communication to IA, R/U line to IA test both flanges, leaking ice damage, repair flanges and retest to 1500psi....good on flange repair. No communication to kill string determined well is frozen or plugged. Repair w'"r wellhead valves, prep and weld damaged valve connection, hook up 2" iron U A 04 November 2017 Test OA valves to 500psi good test, R/U flow tee, R/U coil tubing on well,test 0' CTU,good test, RIH,tagged solid ice at 800' MD,work down and break out of ice @ 940ft,establish communication on IA, pump in T/1700'; MD,circulate well bringing up a mixture of brine&diesel, POOH pumping freeze protect diesel down coil, break CTU from well, secure well, end well operations for day. • • 05 November 2017 R/U and pump 170F fluid down IA circulating up tubing to thaw OA and clear 0' IA of ice, pressure test IA and tubing T/1500psi for 30 min.with AOGCC rep witnessing,good test. Pumped down OA 22 BEI to pressure to 500psi, hold pressure on OA R/U and pump 170F fluid down IA and up tubing, R/U coil and RIH circulating down from 840ft to 1600ft, POOH freeze protect coil,, MU landing joint R/U elevators and slips pull hanger and tubing with crane, laydown hanger, drop 2-7/8 tubing, M/U well tree T/wellhead, suspend operations for night. 06 November 2017 RIH with W/gauge ring T/2700ft circulate to warm M/U 9 5/8 BP on setting 0' tool, RIH W/same,Set BP at 2560ft, running tool would not release from BP, performed several over pulls T/55K without successfully releasing, Coil Stuck suspend operations for the night 07 November 2017 Attempt to free coil, No joy pump hot diesel down tubing out IA,freeze 0' protected the coil Suspend operations for night. Approval from AOGCC representative to Guy Schwartz to place cement on top of bridge plug through coil. 08 November 2017 Cut Coil Tubing on surface, R/D Coil. Cementers R/U on coil stub 0' 1st cement plug:Tested lines to 4800psi, pumped 5 BBL water ahead, 18.5 BBL of 15.8ppg slurry, displaced with 1.2 BBL water&3.2 BBL of diesel,shut in well. Suspend operations for the night. 09 November 2017 R/U Wireline unit& pole truck, M/U, RIH T/450ft, POOH, M/U jet cutter RIH 0' and cut tubing at 450ft, POOH and rig down WL unit, POOH and laydown tubing in approximate 30ft sections, rig down BOPs and crossovers, remove tree, R/U WL, M/U 9-5/8 BP, RIH, set BP at 410ft, set down to confirm set POOH, M/U tree, M/U tubing punch and RIH, (9 shots, 2.9ft, .56 hole), RIH and tag plug P/U and shoot, BTM shot 400ft/Top shot 398ft, POOH with wireline,fuel all equipment, shutdown until morning, 10 November 2017 R/U cement pump and attempt to establish circulation through perfs at 400ff 0' down OA up IA without success, pressured to 500psi .6 BBL&900psi .7 BBL, fifk rig up WL and RIH with tubing punch T/330ft,shot a second set of, perforations,9 shots/2.9ft/.56 size, POOH and laydown perforating U equipment, all shots fired,established circulation through new perfs with 10 BBL diesel, pumped 46 BBL of permafrost cement pumped down OA and up the IA until cement was confirmed at surface, rigged down all wellhead iron 11 November 2017 Cut Coil Tubing on surface, R/D Coil. R/d down all equipment,wait on 0' welder to remove wellhead 12 November 2017 Cut Coil Tubing on surface, R/D Coil. R/d down all equipment, wait on 0' welder to remove wellhead 13 November 2017 Cut Coil Tubing on surface, R/D Coil. R/d down all equipment,wait on 0' welder to remove wellhead • 14 November 2017 Wellhead was successfully remove using the welder while 2 vacuum trucks 0' pulled water from the cellar, after the wellhead was off it was determined the 9-5/8 x 13-3/8 annulus needs to be topped out,the AOGCC rep was notified 15 November 2017 Pulled water from cellar with vacuum truck& pumped 5-1/4 BBL of 0' permafrost cement @ 15.6ppg to top out the 9-5/8 x 13-3/8 annulus, 16 November 2017 Wellhead cap was welded on and witnessed by AOGCC inspector. The cellar 0' was removed and gravel was used to fill the cellar to level grade of pad. • .s O 601 W 5th Ave,Ste SO:. Q(907)888-8070 ) (irtilt �6&ir Anchorage.AK 99501 Q(947)891-9700 Mitl' Q www greatbearpetro corn = i' f f Merak: Estimated to be about 100,000 sq.ft. of disturbed area. "r Aif 1 '� r ad`s t a ... ,� �, _ r�,"'� ; ' � RAK#/4 t ' ,� z 4 a t 44 d fi ' k "is ..'," 4 a IN Irk Study Arita Boundary Trans Alaska Pipakne I mak a1 ._.._..._.I CK.M Sett Perrelrum LLC *Wm of OtNtleton Soil Testing Great Bear will test 4 separate soil samples for fuels analyses at each pad (2 samples in the pad where the drilling took place and 2 samples in the ramps that will be removed). Samples will be kept at the required temperature and shipped to a laboratory in Anchorage for analysis of gasoline range organics (GRO), diesel range organics (DRO), residual range organics (RRO), methods AK 101, 102, and 103. Samples will be collected in the gravel, just above tundra. Lab results will be provided with a summary memorandum. 4 S r a ,. f' n g h • w Zi ffi • • „r . '' 4p4- ..YF i t ' i ,-,, , 0 • BIZ /C I Schwartz, Guy L (DOA) HYD From: Michael Duncan <michael@greatbearpetro.com> Sent: Monday, November 27,2017 9:40 AM To: Schwartz,Guy L(DOA) Subject: RE: Review of valve failures.pptx Guy— I hate to speculate. I am not sure the force ice could apply on those bolts, but I agree that it could apply additional tension on the studs. Maybe the gasket over various heat and freeze cycles(weather)lost integrity.This is really out of my expertise area here. I hope the review helps and we are all a little more aware in the future. Michael From:Schwartz,Guy L(DOA) [mailto:guy.schwartz@alaska.gov] Sent: Monday, November 27,2017 8:42 AM To: Michael Duncan<michael@greatbearpetro.com> Cc:Patrick Galvin<pat@greatbearpetro.com> Subject: RE: Review of valve failures.pptx Michael, Thanks for the review. Any thoughts to the IA flange leaking? I would assume that ice was the cause for stretching the bolts on the flange. Hard to come up with any other explanation since IA pressure tested OK when well was left a few years ago. Guy Schwartz Sr. Petroleum Engineer AOGCC 4 907-301-4533 cell ����e® �p 907-793-1226 office CONFIDENTIALITY NOTICE:This e-mail message,including any attachments,contains information from the Alaska Oil and Gas Conservation Commission (AOGCC),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 AOGCC is aware of the mistake in sending it to you,contact Guy Schwartz at(907-793-1226) or(Guy.schwartz@alaska.gov). From: Michael Duncan [mailto:michael@greatbearpetro.com] Sent: Monday, November 20, 2017 1:26 PM To:Schwartz,Guy L(DOA)<guy.schwartz@alaska.gov> Cc:Patrick Galvin<pat@greatbearpetro.com> Subject: Review of valve failures.pptx Guy— Please take a look at the attached ppt. Hopefully this will show what we found. Please let me know if this covers it or if more is needed. Thank you, 1 i • n N NI (1) L D Zr) . - no _. L L CD c L II co .,,, ,. . 3 ...... w E um co ,x, l W a a CO ^_ a) a) a-+ L a) c cL 3 _. 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C ._O +_, v, i.,, o o +„ a O U -0 C CD bA - N (7 �G > a) ca 0 a1 4—O U) 2 tap 4 fB U U 'v, 0- E a • • MEMORANDUM State of Alaska Alaska Oil and Gas Conservation Commission TO: Jim Regg ��1 Il(2Z(' 1 DATE: 11/17/17 P. I. Supervisor FROM: Guy Cook SUBJECT: Surface Abandonment Petroleum Inspector Merak#1 Great Bear Petroleum LLC PTD 2121010; Sundry 317-478 11/16/17: I traveled to Merak#1 and met with Paul Smith (Great Bear Petroleum) to inspect cement to surface and witness the installation of the identification marker plate. I witnessed cement to surface that was fully cured. The plate was welded on and from the top of the identification plate to ground surface was measured at 10 feet. The identification plate was bead welded with the proper information including: the well name, PTD#, the name of the operator, the name of the well and the API#. - After my inspection of the identification plate installation the process of removing the cellar box and filling of the cellar began. Attachments: Photographs (4) SCANNED 2017-1116_Surface_Abandon_Merak-1_gc.docx Page 1 of 3 • • Surface Abandonment— Merak #1 (PTD 2121010) Photos by AOGCC Inspector G. Cook 11/16/2017 • � II • Casing cutoff; cement to surface ft Side outlet on conductor casing sealed 2017-1116_Surface_Abandon_Merak-l_gc.docx Page 2 of 3 • 0 F ,... . . . . ',lir" • ,,,' • . '.', • . •‘ . . .. • ... , ..... , „ .! .".1.... - ' to ' * J. ,...t..--,' . 't.--4.4.4,„ ' .. • • , . . ,.. , ,.• ,,„,ifr.,440-ow •' ' - A' 'li. . 4 i - 4.. • . , ' . of. • ,.. ,----, li• 11100i .; . . ' .. • ' rt44 -= i..1 -. 0 ... r • . " - ,..-..., -c) a.) ti c7.0 ' °N., • * ' I .., ,--. v; ,41 .... . .,... ;-, cu 0.) 0 .-SE..• 1 0 rn 1.-. 0 W I.) . .-0 0 .i... 0 0 01 f') a) c) ;-, .7 ... r2- ,-- / . c., . . ? t 4 ) , - ., . ... - 44 ' ....f. ,. .- • ( ) 1 4t ._ . . 1, .) , r ' ..., „ . , ,. , .. i lt,), ,r... , ,i I , - - 0 I ,r 4 tf Ni ..-- :141— i (- ' / ' ..,. - , i , I ' ,....1./•.../. a,-, 0... -, • • le ,e 4iiiiiii\ir\. .. 442, A I I i I le . ' ,..'"/;* V ' .1 e , . .,.. , r .,.. ,1" ' . 1 , , t 4 ,i , , .., .,„. 1 . • P1t ZL Z.io to Regg, James B (DOA) From: Michael Duncan <michael@greatbearpetro.com> Sent: Wednesday, November 8, 2017 7:12 AM To: Regg, James B (DOA) 1 Cc: Schwartz, Guy L (DOA); DOA AOGCC Prudhoe Bay Subject: RE: BOP standard Mr. Regg— Sorry not to send this email yesterday. Thank you for bringing this discrepancy to my attention, and for the time discussing the matter. As discussed,the plan forward is to continue with the work on the Merak#1 well. I will communicate to all personnel involved that the subsequent BOP test will follow API RP 16ST to its fullest. As always, please give me a call if there are questions or concerns. 817.240.3865 Michael ckyk4 4Fekri— `I 444— 04,„.k From: Regg,James B (DOA) [mailto:jim.regg@alaska.gov] Sent:Tuesday, November 07, 2017 8:39 AM To: Michael Duncan <michael@greatbearpetro.com> Cc:Schwartz, Guy L(DOA) <guy.schwartz@alaska.gov>; DOA AOGCC Prudhoe Bay<doa.a :cc.prudhoe.bay@alaska.gov> Subject: RE: BOP standard API RP 16ST states "pressure shall be stabilized with no leakage for a minimum • 10 minutes". I don't seen pressure stabilization in the tests. Jim Regg Supervisor, InspectionsSCANNED OA ry AOGCC 333 W.7th Ave,Suite 100 Anchorage,AK 99501 907-793-1236 CONFIDENTIALITY NOTICE:This e-mail message,including any attachments,contains information from the Alaska Oil and Gas Conservation Commission(AOGCC),State of Alaska and is for the sole use'the intended recipient(s).It may contain confidential and/or privileged information. The unauthorized review,use or disclosure of such informption 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 AOGCC is aware of the mistake in sending it to you,contact Jim Regg at 907- 793-1236 or jim.regg@alaska.gov. From: Michael Duncan [mailto:michael@greatbearpetro.com] Sent: Monday, November 6, 2017 5:43 PM To: Regg,James B (DOA) <jim.reg @alaska.gov> Cc:Schwartz, Guy L(DOA) <g, c.schwartz@alaska.gov> Subject: Fwd: BOP standard Mr. Regg- 1 • • .11/4&ereek_it, i) ZI zi OiQ Regg, James B (DOA) From: Regg,James B (DOA) Sent: Tuesday, November 7, 2017 8:39 AM To: 'Michael Duncan' i )11 —1I(1 Cc: Schwartz, Guy L (DOA); 'AOGCC.Inspectors@alaska.gov Subject: RE: BOP standard Attachments: BOP Halliburton2 charts 11-2-17.pdf API RP 16ST states "pressure shall be stabilized with no leakage for a minimum of 10 minutes". I don't seen pressure stabilization in the tests. Jim Regg Supervisor, Inspections AOGCC 333 W.7th Ave,Suite 100 Anchorage,AK 99501 907-793-1236 CONFIDENTIALITY NOTICE:This e-mail message,including any attachments,contains information from the Alaska Oil and Gas Conservation Commission(AOGCC),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 AOGCC is aware of the mistake in sending it to you,contact Jim Regg at 907- 793-1236 or iim.regg@alaska.gov. From: Michael Duncan [mailto:michael@greatbearpetro.com] Sent: Monday, November 6, 2017 5:43 PM To: Regg,James B (DOA)<jim.regg@alaska.gov> Cc:Schwartz, Guy L(DOA)<guy.schwartz@alaska.gov> Subject: Fwd: BOP standard Mr. Regg- In response to your question regarding which API standards were used for evaluating the BOP test, please see the correspondence from Haliburton below. Please feel free to contact me should further information or clarification be needed. Thank you, Michael Sent from my iPhone Begin forwarded message: From: Adam Kendall <adam.Kendall@Halliburton.com> Date: November 6, 2017 at 4:43:50 PM AKST To: "Michael Duncan (michael@greatbearpetro.com)" <michael@greatbearpetro.com> Subject: BOP standard API RP 16ST First Edition March 2009 is the BOP standard. Section 12 is the testing portion 1 Adam Kendall Halliburton Field Service Quality Coordinator— Coiled Tubing 13100 County Road 8 Fort Lupton CO, 80621-8345 Email: adam.kendall halliburton.com Office: +1 303-655-4889 Mobile: +1 907-250-9547 HALL.J BURTON This e-mail, including any attached files, may contain confidential and privileged information for the sole use of the intended recipient. Any review, use, distribution, or disclosure by others is strictly prohibited. If you are not the intended recipient (or authorized to receive information for the intended recipient), please contact the sender by reply e-mail and delete all copies of this message. 2 • • STATE OF ALASKA OIL AND GAS CONSERVATION COMMISSION BOPE Test Report *AII BOPE reports are due to the agency within 5 days of testing* Submit to:jim.reggna.alaska.qov;AOGCC.Inspectors@alaska.gov; phoebe.brooks@alaska.gov Contractor: Halliburton Rig No.: 2 DATE: 11/2/17 Rig Rep.: Adam Kendall Rig Phone: 907-250-9547 Operator: Great Bear Op. Phone: 817-240-3865 Rep.: Michael Duncan E-Mail michael@greatbearpetro.com Well Name: Merak#1 PTD# Sundry# 317-478 Operation: Drilling: Workover: x Explor.: Test: Initial: x Weekly: Bi-Weekly: Test Pressure(psi): Rams: ¢wa Annular: N/A Valves: 25v 4t7W MASP:}500' MISC. INSPECTIONS: TEST DATA FLOOR SAFETY VALVES: Test Result Test Result Quantity Test Result Location Gen. P Well Sign P Upper Kelly 0 NA Housekeeping P Rig P Lower Kelly 0 NA PTD On Location _P.-OA Hazard Sec. ,..>"' Nts, Ball Type 0 NA Standing Order Posted P Misc. NA Inside BOP 0 NA FSV Misc 0 NA BOP STACK: Quantity Size/Type Test Result MUD SYSTEM: Visual Alarm Stripper 1 4.06 P Trip Tank NA NA Annular Preventer 0 NA Pit Level Indicators NA NA #1 Rams 1 Blind P Flow Indicator NA NA #2 Rams 1 1,1,-T," -ru1-4N 4r P Meth Gas Detector NA NA #3 Rams 1 � —JipJ NA H2S Gas Detector NA NA #4 Rams 1 Tebing -.P' pik MS Misc 0 NA #5 Rams 0 NA #6 Rams 0 NA Quantity Test Result Choke Ln.Valves 0 NA Inside Reel valves 1 P HCR Valves 0 NA Kill Line Valves 2 1.75in/lotorc P Check Valve 1 2in/lotorc P ACCUMULATOR SYSTEM: BOP Misc 0 NA Time/Pressure Test Result System Pressure(psi) 2900 P CHOKE MANIFOLD: Pressure After Closure(psi) 1800 P Quantity Test Result 200 psi Attained(sec) 1 P No.Valves 2'0 .P-Nik Full Pressure Attained(sec) 5 P Manual Chokes 0 P-- Blind Switch Covers: All stations Yes Hydraulic Chokes 0 P.-,J . Nitgn. Bottles#&psi(Avg.): 5„/„..1.590' th- r MA- CH Misc 0 .,p- ON ACC Misc 0 NA Test Results Number of Failures: 0 Test Time: 4,g Hours Repair or replacement of equipment will be made within N/A days. Notify the AOGCC of repairs with written confirmation to:AOGCC.Inspectors@alaska.gov Remarks: Lett 5644,6 i S SktS� d (Lt14-Sp_Op-:� -�1-CMstr�i-t el.� AA-- 1-Le eiccepictte (14- w X-.4+°a I'i4,, r ('' Cc'.l TuA! vk i4g ecKfr.,� wgAt.goi-Sy`. �+e) r5'tret+m 4o0-f 5s`4'C- S 6)I,1 j (s` (�{eI) ,410 h.s at v .0en `hue, ASOP 40- 14-441-15 sower r„rCLt ►1xs SU.4114.-S►.l yt ro w'eld bare tel► sr,o-e_.. AOGCC Inspection 24 hr Notice NO Date/Time litlilt 7. MS Waived By Test Start Date/Time: tt(t4 r i 15Ov, (d te) (time) Witness Test Finish Date/Time: kill- I I 1i 30 Form 10-424(Revised 03/2017) Merak 1 -State of Alaska BOP Test form . . . O OE > .N M 1 pdN 2 °c F a 01 N m o J `a o 4 w I N z CO N 0 co Lo , M N r N co N N N N 7 .— L ln O 0- 0 fn N _ •N• a Lra o cn 2 co o CL M c 73 N - ..- _c 1 N- L O 3 — _ N N '- > 00 N 0 - � E ? N • 0 a - LL N a ca > 0 o o > 0 c O El It o - CO -a W c 2 .- L a its N m -. N v N T- P2 d CLcc c L N fn p 0_ 4--. ED- 0 0 d L N co d N On a) U N Do , I ' ' I I 1---- = N CD O O O O O I V > ami O O O O Co c.) LO It M N x- a 0 • • • o� o 0 N i01 2 h N` a M d z° -I 3 A ..1a o Q z Z O IT CO 0 V' ) CO N N- - ID Nt 4) 12 0 Q To _ 2). N co oE TT( If VI w r NN _ J ca ^L LL O : 17 L_ 0 N 0 _ �_ z Z M P. ~ O a IL N 0 0_N caM - o jo g c •c O a d- o 0 06 ac) COCt ,_ u) o LLI c co _ i N 00 112 ii. 0 ca -612 OI OI O O M N 0 • .. O po > N o CON c v d r o ,f La Q _ w I- z O X". d CD N ') N"'" CO N O N 1 ii - L 4) cn _ 0 Q . N E I To U U) v.- CO N (V L o 0_ C C6 11 a) , 55 . Cz) ) N N , �a Oa) 0 -22 t-- O Z a� CD ` Cf) ' c N O - N 0 a. co cts 0 > 0 > c o -) D Ey O Nr o 0 06 ci) 'ct OU M o W C r u) _ ._ m L ro Ca N m g co 0_ U' ccoo c L c cn L 0 o cn a 9- 'L LL N cn U — o O CI 4 I � 0 I .4-N 5 N O O 0 O O O' .,—%- V O 0 0 O 0 0 Cf) M N % __ o • • MEMORANDUM State of Alaska Alaska Oil and Gas Conservation Commission TO: Jim Regg DATE: 11/08/2017 P. I. Supervisor FROM: Adam Earl SUBJECT: P&A Operations Petroleum Inspector Merak #1 Great Bear Petroleum PTD 212-101, Sundry 317-478 " Summary of phone conversations regarding the Merak #1 P&A operations. 11/8/17: Took over this job from Bob Noble and I spoke with Mr. Jerry Otto (Great Bear Petroleum) on their work plan. They set a plug at 450 ft with coil tubing and could not release from it. Attempts to get coil off the plug were unsuccessful so the decision was made to cut the coil at the top of the tree and run wireline in to cut the coil off just above the plug. 11/9/17: I went to the Merak drill site to check on operations. They were getting ready to cut the coil tubing and lay it down in 20-foot sections. 11/10/17: Spoke with Mr. Otto by phone this morning on the plan forward. They were going to establish circulation from the outer annulus to the inner annulus so they could pump cement. 11/10/17 4:00pm Update: The well is cemented to surface as per Mr. Otto's phone call. 7 same R 0 9 2(11h 2017-1110_P&A_Merak-1phone_record_ae.docx Page 1 of 1 • Schwartz, Guy L (DOA) From: Schwartz, Guy L(DOA) Sent: Monday, November 06, 2017 8:43 AM To: Regg,James B (DOA) Cc: Noble, Robert C (DOA) t e Subject: RE:Great Bear Merak#1 .. ' ®' Jim, Another reason for a guidance doc for cellar inspections more frequency for suspended exploration wells. Two issues this year. The well should be dead as it has a downhole plug. Does sound like the tubing is frozen...they should be able to pump down kill string and take returns up IA. They have not sent me any info... strange. Guy Schwartz Sr. Petroleum Engineer AOGCC 907-301-4533 cell SMINED 907-793-1226 office CONFIDENTIALITY NOTICE:This e-mail message,including any attachments,contains information from the Alaska Oil and Gas Conservation Commission(AOGCC),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 AOGCC is aware of the mistake in sending it to you,contact Guy Schwartz at(907-793-1226) or(Guy.schwartz@alaska.gov). From: Regg,James B (DOA) Sent:Saturday, November 04,2017 4:58 PM To:Schwartz,Guy L(DOA)<guy.schwartz@alaska.gov> Subject: Fwd:Great Bear Merak#1 Sent via the Samsung Galaxy S8 active,an AT&T 4G LTE smartphone Original message From: "Noble, Robert C(DOA)" <bob.noble(atalaska.gov> Date: 11/4/17 7:40 AM(GMT-09:00) To: "Regg,James B(DOA)"<jim.regg@alaska.gov> Subject: Great Bear Merak#1 Jim I went down there yesterday to see them do a pressure test of the well or MIT. Jerry Otto wanted to test the tree first. He had a 2 way check set and they tied into the tubing and tested and it passed. i • S Then they were going to do a MIT-T/IA as the well has an 800'work string in it. He then told me that he was not going to be able to get any OA pressures as the OA valves had been bent up and one was broken. (IA and OA valves were down in the cellar box)(cellar box was taking on water and had to be vac'ed out. They removed 2 way check and tried to pump down the tubing and it pressured up right away.So they tied on to the IA with the pump and it pressured up and started leaking on the inside flanges on the IA valves. I then told Jerry that he need to call our office and regroup. Jim to me, I think the cellar box filled with ice and messed up the valves and I also think the fell is frozen. 2 • . ,k&i41 (pi-1) ZIz 10(c) I o • F It sit ss ter:: w ITOP OF RIG MATS , .r i • 13-518"10.000 PSI 68X 6.00" sr TOP OF RIG MATSD " ® w' ------� _ —T_ i �. 9.0T --DRILLING ADAPTER 6.00" „ ,{ 13-5/8"5,000 NT-2 S 0 - r .. i, !I I ,, .,.. 8.93' te.00 ,:41 _---... ___-- DRILLING ADAPTER 4844" GROUND _ _ LEVEL MIR MOO Q 0 C , -01=1201=--_ 58.14' f '... 1. PICIONT 13.5!8'5,000 PSI 68X ' n.--- 1 s' a.•y ':;.,., - 31.07. cs 2.1/16'5.000 PSI , ts �► I fi . /' .7.r",),1 .0 jij ,, t 1e _- ,^ 13.378'QUICK DISCONNECT , r - _ 7 II tI1: .:'"� - -13-3/8"FLUTED CASING HANGER /�. �,I 20'LANDING RING 1 z -- ---. F --20"OD CSG I _____.— .: ___P--- '3-3/8' — '3-3t8'OD CSG --- INSTALLATION 01 DRILLING ADAPTER i vetco9Par ----- IGYOUT I SK STEP 8p 1::;w IIPI?OID/ a0 M I IIDO{l NII( IIP Ite IIP-1 I 1 .._..._ - IK,I • i i , `0 . er + . . 0,.,,.../lr.` ji. i f • . L , «� IV- i t 7 4. 4 ,'.' — t.. - . ', '''* ,.. , „,. . • ` '0.7 � t ' . , 41)-f.' '-.'-'-„,-..-'''' /y ,$ ' .a i. ti " ,... 44.,--; * ,,., ' .;.*p.',44*-- •;..- s- -' -:.*y, ,,*, ..."7'.::,1't c.*. al ty +' Rt,r � .,4.;,,, --, ,,,,,' 3,,,iii '4.4,12* li � 4.,r z [ e� � ` f :.0. " It '//l y ' 4,p,',...:,;,..„,-;?f,",?'‘'..", q4 ,Alf-i,„+' i,,i af '�` i a 4 • • Schwartz, Guy L (DOA) From: Michael Duncan <michael@greatbearpetro.com> Sent: Tuesday, November 07, 2017 8:01 AM To: Schwartz, Guy L(DOA) Subject: FW: Merak Wellhead ' � / cI l l Guy—This email just got kicked back, so I am sending it without the pics. I'll send the pics in a separate email. From: Michael Duncan Sent:Tuesday, November 07, 2017 7:44 AM To: 'Schwartz, Guy L(DOA)'<guy.schwartz@alaska.gov> Cc: Patrick Galvin<pat@greatbearpetro.com> Subject: Merak Wellhead Mr. Schwartz— This email is in follow up to our discussion yesterday.As discussed,we found that the outer annulus (OA)valves had lost integrity at the connection to the wellhead.A weld where the nipple connects to the wellhead body had a split along the weld. On attempt to pressure test the Inner Annulus (IA)we found test fluid leaking at the flange point. The IA valve flanges were tightened, after which the system held pressure integrity to the specified 1500psi. A welder was called out to address the OA valves, and the split was repaired. Pictures before and after are attached. After this repair the OA was tested to ensure he pressure integrity up to 500 psi as specified in the procedure. In short, all failures were repaired prior to any further activity. Once the repairs were made and results met the requirements in the procedure we continued forward. It was suspected during the wellhead pressure testing that the Tubing and IA were frozen down hole.This was confirmed when coil ran in hole and tagged at 800'. Circulation of hot fluid resulted in forward progress, and soon after the communication from the IA to the tubing. Please let me know if further information is needed. Thank you, Michael (--1) t /1.7) PAA/1/4"?f ei-j€4/11 1 • S ' MICHAEL DUNCAN SENIOR DRILLING 8.COMPLETIONS ENGINEER O michael©greatbearpetro.com O (817) 240-3865 6reAt6mr P ' T R ,,,.„ :,_ _ ... , ,,, , AlliPt 0 (907)868-8070 O (907) 868-3887 O mvw.greatbearpetro.com 4) 601 W 5th Ave, Ste.505 Anchorage,AK 99501 ,,, i;,1 ;, li..;;:ritained in this ttansrntssion is intended only for the person or entity to .. i.:ii ii is douresseu a:141 rII ::.ori;ain confideru,oi and/or privileged material. It you received this transmission in error, please contact the sender and destroy all printed copies and perma- nently delete the material from all electronic storage devices If you are not the intended recipient of this information,do not review,retrans- mit,disclose,disseminate,use, or take any action in reliance upon this information. • • • • 2 • Schwartz, Guy L (DOA) From: Schwartz, Guy L (DOA) Sent: Wednesday, November 08, 2017 8:50 AM To: 'Michael Duncan' Cc: Patrick Galvin Subject: RE: Merak#1, sundry 317-478 (PTD 212-101) Michael, The deviation from the approved sundry will also P&A Merak#1 to our regulations. Using the CT as a "leave in place" tubing cement string is done frequently and should allow cement placement to be done with high certainty. The only downside is not being able to tag cement but there is a solid base for placement using the bridge plug. Your plan is APPROVED as submitted below. Guy Schwartz Sr. Petroleum Engineer AOGCC 907-301-4533 cell 907-793-1226 office CONFIDENTIALITY NOTICE:This e-mail message,including any attachments,contains information from the Alaska Oil and Gas Conservation Commission (AOGCC),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 AOGCC is aware of the mistake in sending it to you,contact Guy Schwartz at(907-793-1226)or(Guv.schwartz@alaska.gov). From: Michael Duncan [mailto:michael@greatbearpetro.com) Sent:Tuesday, November 07, 2017 7:29 PM To:Schwartz, Guy L(DOA)<guy.schwartz@alaska.gov> Cc: Patrick Galvin<pat@greatbearpetro.com> Subject: Merak#1, sundry 317-478 Guy On Merak#1,the bridge plug was tripped into the well on 1-3/4" coil and set at 2550' MD. The tool malfunctioned and did not release the coil after the bridge plug was set. No disconnect is in the string and we have not been successful pulling up to release. Attempts of 70Klbs multiple time have been attempted. We are able to circulate and have been pumping warm fluid down coil for the last 22 hours. At this time we would like to move forward with the following supplemental procedure to successfully abandon the Merak#1 well. 1. Cut coil at surface and demobe coil tubing unit 2. Rig up connection to coil at surface. 3. Pump cement down abandoned coil up the IA: place cement above bridge plug(17 bbls of 15.8 ppg class G cement, calculated TOC: 2,330) 4.) Utilize wireline and cut coil at 450' MD 5.) Pull coil from well Follow approved procedure from step 15 in approved Sundry 317-478 15.) Set Bridge Plug at 410' MD 1. �� �� .�' 16.) Perforate 9-5/8" casing at 400'MD Continue with approved sundry procedure The cement procedure is design to have over 200' of cement above the bridge plug and leave over 300'of cement in the coil. The coil has a check valve in the string and we have a high confidence that cement can be placed where required. Attached is a proposed schematic showing the plugged configuration. If you have any questions or concerns please contact me on my cell phone. 817.240.3865 Thank you Michael DUNCAN MICHAEL ��8 KNCAN St � a C ~mp x. ',. • nn|choe/tagnmmtbearpetro.corn • (817)240'3885 �� (�¢7) ���-8�7O (zreiit tour (9Q7)r- T ' | E U M • xvvvw.gremtbemrpwtn»corn 6O1VK5th Ave, Ste 505 Anchorage,AK 99501 The information contained in est transeression ts intended orey tor the person or amity to Math 4 PS addressed end may contain confidential and'or postieged In/Menai ff yOtt received this thinennston error please contact the sender and destroy ell prtnted coptes and derma mutest deer*the ortatersel from lei electrortic storage detymes If you AV the intended mcipiertt of less information.donot restate,meanm me'Oscars*.disseminate.use,or take anv�ttton 41.^eltance upon this Informatron. 2 ti OF T� t„, \\�j/ 4'sA THE STAT Alaska Oil and Gas oA LAsKAL Conservation Commission GOVERNOR BILL WALKER 333 West Seventh Avenue ®F :T, P Anchorage, Alaska 99501-3572 ALAS Main: 907.279.1433 Fax: 907.276.7542 www.aogcc.alaska.gov Patrick Galvin Chief Commercial Office Great Bear Petroleum Operating, LLC SCOW DEC 0 52017. 601 W 5th Ave., Suite 505 Anchorage, AK 99501 Re: Exploratory Field, Exploratory Pool, Merak 1 Permit to Drill Number: 212-101 Sundry Number: 317-478 Dear Mr. Galvin: Enclosed is the approved application for sundry approval relating to the above referenced well. Please note the conditions of approval set out in the enclosed form. The AOGCC will treat the Sundry application and accompanying material as non-confidential because Great Bear has withdrawn its request for confidentiality. As provided in AS 31.05.080, within 20 days after written notice of this 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. A request for reconsideration is considered timely if it is received by 4:30 PM on the 23rd day following the date of this letter, or the next working day if the 23rd day falls on a holiday or weekend. Sincerely, Hollis S. French Chair DATED this 1L. day of October, 2017. RBDMS 0/OCT 2 5 2017 3 • • 0 RECEIVED STATE OF ALASKA ALASKA OIL AND GAS CONSERVATION COMMISSION OCT 0 6 011 APPLICATION FOR SUNDRY APPROVALS ice"- /Di i Z/ /7 20 AAC 25.280 AO O C C 1.Type of Request: Abandon ❑� - Plug Perforations❑ Fracture Stimulate ❑ Repair Well ❑ Operations shutdown 0 Suspend ❑ Perforate 0 Other StimulatePull Tubing ❑ Change Approved Program 0 Plug for Redrill 0 Perforate New Pool CIRe-enterSusp Well 7 Alter Casing 0 Other: ❑ 2.Operator Name: 4.Current Well Class: 5.Permit to Drill Number: Great Bear Petroleum Operating LLC • Exploratory El Development ❑ 212-101 • 3.Address: ❑ 6.API Number: Stratigraphic ElService 601 W.5TH Ave,Suite 505,Anchorage,Alaska 99501 50-223-20027-00-00 • 7.If perforating: 8.Well Name and Number: What Regulation or Conservation Order governs well spacing in this pool? No Will planned perforations require a spacing exception? Yes ❑ No ❑� Merak#1 9.Property Designation(Lease Number): 10.Field/Pool(s): ADL 391706 • Exploration • 11. PRESENT WELL CONDITION SUMMARY Total Depth MD(ft): Total Depth TVD(ft):/Effective Depth MD: Effective Depth TVD: MPSP(psi): Plugs(MD): Junk(MD): 1 'MD//7ciN 1f 5'TVD /I/GSI 9,042'MD 9035'ND 0 9,042'MD Casing, ./7 Length / �17 Size MD TVD Burst Collapse Structural K''f NA /� Conductor 93' 20" 93' 93' NA NA Surface 2,441' 13-3/8" 2,441 2,441' 5020 2260 Intermediate 8,726' 9-5/8" 8,726'MD 8,731'ND 9440 5300 Production Liner Perforation Depth MD(ft): Perforation Depth ND(ft): Tubing Size: Tubing Grade: Tubing MD(ft): NA NA N/A Packers and SSSV Type: Packers and SSSV MD(ft)and ND(ft): NA NA 12.Attachments: Proposal Summary U Wellbore schematic ❑� 13.Well Class after proposed work: Detailed Operations Program ❑ BOP Sketch ❑ Exploratory Q ` Stratigraphic❑ Development❑ Service ❑ 14.Estimated Date for 10/26/2017 15.Well Status after proposed work: Commencing Operations: OIL ❑ WINJ ❑ WDSPL ❑ Suspended ❑ 16.Verbal Approval: Date: GAS ❑ WAG ❑ GSTOR ❑ SPLUG ❑ Commission Representative: GINJ ❑ Op Shutdown ❑ Abandoned Q• 17. I hereby certify that the foregoing is true and the procedure approved herein will not be deviated from without prior written approval. Authorized Name: Patrick Galvin Contact Name: Tim Flynn Authorized Title: Chi Comercial Officer Contact Email: tim.flvnn aOak-dc.com h ' ,� Contact Phone: 907 317 5504 Authorized Signature: �_ — I0_ Date: COMMIS ON U E ONLY Conditions of approval: Notify Commission so that a representative may witness Sundry Number:� ' 1-C)0 c o4b IJ Plug Integrity a( BOP Test ❑ Mechanical Integrity Test 0 Location Clearance r Other: J A'/ L ! 4 , o t_ t..SV r*-, z 2J OQJ -- L tD c.j..„ Yt Post Initial Injection MIT Req'd? Yes 0 No ❑ t� Spacing Exception Required? Yes ❑ Er Subsequent Subsequent Form Required: � 96 7 RBDNIS J/ OCT 2 5 2u 117 EA20 �� APPROVED BY Approved by: ��t �. COMMISSIONER THE COMMISSION Date: ( G 1 %. 11 4 `I0 ;./j QRI GIN yraPForm 10-403 Revised 4/2017 Approved application is valid for 12 oh val. ,Attt�aac/chments in Duplicate doi `t`7r/ /0-7.t7 0 601 W.5th Ave,Ste.: 0(907)868-8070 5er Anchorage,AK 99501 0(907)891-9700/�` 0 www.greatbearpetro.com DROLL RECEIVED October 4, 2017 OCT 06 2017 Alaska Oil and Gas Conservation Commission AOGCC 333 West 7th Avenue, Suite 100 Anchorage, AK 99501 RE: 10-403 Sundry for Permanent Abandonment: Great Bear Merak #1 PTD 212-101 Dear Commissioner: Great Bear hereby submits an Application for Sundry Approvals for the permanent abandonment of Merak #1 , permit to drill 212-101 . Merak #1 was spudded 8/22/2012, and a total depth of 11 ,094' was reached on 10/05/2012. 8-3/4" hole was drilled to TD of 11 .094' MD with no casing run past the 7" intermediate casing set at 8,311 ' MD. The 8-3/4" open hole was fullycemented back above the 7" casing shoe to a depth of 7,833' MD. The abandonment procedure is attached with the form 10-403 sundry application. In the abandonment procedure, Great Bear plans to follow 20 AAC 25.112 (g)(1 ) for tagging requirements, by placing weight on the mechanical plug prior to placing cement. Pertinent information attached to this application includes the following: 1 . Form 10-403 Application for Sundry Approvals - 2 copies 2. Abandonment Procedure 3. Current Wellbore Schematic 4. Proposed Abandonment Wellbore Schematic 5. Directional Survey The AOGCC is requested to treat as confidential all information included. If you have any questions or require additional information, please contact Tim Flynn, Drilling Engineer at 907-317-5504, or myself at 907-868-8070. Sincerely yours, Great Bear Petroleum Patrick S. Galvin Chief Commercial Officer And General Counsel ORIGINAL www.greatbearpetro.com • • • E Alaska R.! Drilling Completions. Procedure: Merak #1 1.) Notify regulatory agencies 48 hours prior to commencing abandonment operations. 2.) Post approved 10-403 Sundry notice on location w ✓ 3.) Move in and R/U over Merak#1 I �,i 4.) Pull 4" BPV 5.) R/U Test Unit and pressure test 9-5/8" casing to 1500 psi for 30 mini Bleed off all pressure 6.) R/U Test unit to 13- 3/8"x 9-5/8" annulus and pressure up to 500 psi 7.) R/U and displace diesel to 9.6 ppg brine from tubing tail to surface 8.) Confirm well is dead, R/D tree from wellhead 9.) Pull 2-7/8" tubing from well, filling hole with 9.6 ppg brine 10.) R/U coil tubing to well 11.) R/U BOP's and test to 3000 psi 12.) RIH with bridge plug and set in 9-5/8" csg @ 2560' MD, Pull up 10K to verify set. 13.) TIH w/coil to 2550' MD and spot 15 bbls of 15.8 ppg class G cement above CIBP 14.) WOC, TIH and set down 10K to verify TOC 15.) RIH with bridge plug on coil and set in 9-5/8" csg @ 410' MD 16.) TIH and perforate 9-5/8" casing at 400' MD 17.) Attempt to gain circulation between the 13- 3/8"x 9-5/8" annulus. 18.) If unsuccessful, R/U on coil to 400' MD and circulate warm fluid (150 deg+) to thaw 13- 3/8"x 9-5/8" annulus. Establish circulation through OA valve 19.) Reverse circulate down OA and establish returns 20.) Mix and pump 55 bbls of permafrost cement to displace brine to surface ,3 "; . /`l Vo 6B4/ t 21.) Close OA valve 376 (--21- 22.) ` 22.) R/D Coil Tubing Unit 1,4 23.) N/D tree and cut off wellhead 5' below ground level ,.=Q` 24.) Top fill with cement if any sag 25.) Weld on abandonment cover '26.) Remove 10' culvert cellar 27.) Bury stub, fill hole and clear/ location j� li-4.Y 1 pc_ el. i..�( Lr+a,.Y..�w. ` 10 ,,4c74a_ Si �e • • Merak #1 (Current) 1 ii Driven Conductor 20"166#X-52 Conductor I: 1 @ +/-93'MD/TVD Port Collar+/-500'MD I. Base of Permafrost @761' Never opened downhole I " 2-7/8"Tubing&Diesel @ 827'MD Ii '1 I; I: ;,-.1.4_16"Surface Hole G ..1 I; Max HoleInclinaticn L Through Surface Hole<2 deg°Inc - I` I: :11 Type P ES Stage Tool w/ I: J 4 Packer @ 2400'MD 13-3/8"68#L-80 BTC Casing @ ' ' I' I +/-2441'MD,2441'TVD I I I I I I I I 112-1/4"Intermediate Hole I I Calc.TOC @ 4600'MD )►�� ..J tp- IA [ -, i) It t` f .) TOC @ 8582'MD-Tagged w/20K Down k 4 9-5/8"47#L-80 BTC Casing @ +/-8726'MD,8731'TVD I ;1 I : 1 I 1 I. 7 I 'j 1::,...:::-„::1 1 r 1 I :J : 9 ''::::::::.:11 8-'/,"Hole filled with Cement Fl 11,094'MD up to 8,582'MD :'3 ::a ::::.Hi -4-- 8'/d Hole :t . .t 1 k::::::::1 1:::::::::1 Itdosko rillingAugust 10, 2017 ompletions Merck#1 TD @ 11,094'MD,11,081'TVD • • Merak #1 (Proposed) 6rmt tar " PTROLLUM I 14 20"130#X-52 Conductor @ +/-93'MD/TVD 1,= : 4 Perferations @ 400'MD Port Collar+/-500'MD is -4 0 Bridge Plug set @ 410'MD Never opened downhole 0 Base of Permafrost @761' I; I: I: i Max Hole Inclination I; 16"Surface Hole Through Surface Hole<2 deg°Inc Calc.TOC @ 2330'MD ..4; --&—°',14 Type P ES Stage Tool w/ Packer @ 2400'MD I' 13-3/8"68#L-80 BTC Casing @ Mechanical Bridge Plug set @ I ''�-� w I +/-2441'MD,2441'TVD 2560'MD I }/\ I I I I I I I<-- 12-1/4"Intermediate Hole I Calc.TOC @ 4600'MD11 t:: i1 t: i ;1 1 !;', :i 4 Calc.TOC @ 8582'MD I*: . ' :I t 14 9-5/8"47#L-80 BTC Casing @ I A_:::, +1-8726'MD,8731'TVD It?,. I •1 :i I. 1 I . : .I I : 1 I f .::I I ' I I ::1 I :i I : i I i f : 1 I ,.I .••"'-" "I 8-%"Hole filled with Cement F/11,094'MD u to 8,582'MD i.I :i: F I 1 :1 -4-- 8-'/4'Hole t : l (ktska Drilling r".:•.-: Completions. Merak#1 TD @ 11,094'MD,11,081'TVD August 17, 2017 • • • '; $ HALLIBURTON I STE DIRECTIONAL SURVEY REPORT Great Bear Petroleum, LLC Merak 1 Exploration North Slope Borough Alaska USA AK-XX-0009498071 Surveys are SAG corrected. Final survey is projected to TD. Measured Vertical Vertical Depth Inclination Direction Depth Latitude Departure Section Dogleg (feet) (degrees) (degrees) (feet) (feet) (feet) (feet) (deg/100ft) 0.00 0.00 0.00 0.00 0.00 N 0.00 E 0.00 TIE-IN 21.72 0.00 0.00 21.72 0.00 N 0.00E 0.00 0.00 205.22 0.40 109.63 205.22 0.22 S 0.60 E -0.58 0.22 293.21 0.66 120.50 293.20 0.58 S 1.33 E -1.35 0.32 387.92 1.20 119.10 387.90 1.33 S 2.67 E -2.83 0.57 480.14 1.33 123.91 480.10 2.40 S 4.40 E -4.81 0.18 572.31 1.27 123.87 572.25 3.57 S 6.13 E -6.86 0.07 659.01 1.69 127.20 658.92 4.88 S 7.95 E -9.07 0.49 755.48 0.75 115.11 755.36 6.00 S 9.65 E -11.07 1.00 852.80 0.80 111.29 852.67 6.52 S 10.86 E -12.29 0.07 948.96 1.24 117.44 948.82 7.24 S 12.41 E -13.90 0.47 1042.78 0.15 104.50 1042.63 7.74 S 13.43 E -14.97 1.17 1140.43 0.57 311.45 1140.28 7.45 S 13.19 E -14.60 0.72 1237.27 0.76 320.43 1237.11 6.64 S 12.42 E -13.48 0.22 1331.49 0.89 324.83 1331.32 5.56 S 11.60 E -12.14 0.15 1424.86 0.73 291.84 1424.68 4.75 S 10.63 E -10.87 0.52 1521.09 0.55 296.22 1520.91 4.31 S 9.65 E -9.87 0.19 1617.23 0.55 303.23 1617.04 3.86 S 8.85 E -8.98 0.07 1712.85 0.43 298.52 1712.66 3.43 S 8.15 E -8.19 0.13 1808.37 0.46 297.19 1808.18 3.09 S 7.49 E -7.48 0.03 1902.82 0.40 283.50 1902.63 2.84 S 6.84 E -6.84 0.13 2000.03 0.50 291.93 1999.83 2.60 S 6.11 E -6.16 0.12 2096.67 0.33 288.27 2096.47 2.35 S 5.46 E -5.52 0.18 2189.37 0.42 293.41 2189.17 2.14 S 4.89 E -4.97 0.10 2286.29 0.22 285.11 2286.09 1.95 S 4.39 E -4.48 0.21 2382.70 0.38 256.72 2382.49 1.97 S 3.90 E -4.15 0.22 2416.13 0.46 300.59 2415.92 1.93 S 3.67 E -3.96 0.96 2476.15 0.31 269.70 2475.94 1.81 S 3.30 E -3.61 0.42 2572.53 0.27 237.07 2572.32 1.93 S 2.85 E -3.38 0.17 2668.57 0.27 225.36 2668.36 2.21 S 2.50 E -3.33 0.06 2762.54 0.36 223.57 2762.33 2.58 S 2.14 E -3.34 0.10 2859.05 0.29 243.52 2858.84 2.91 S 1.71 E -3.27 0.14 2954.96 0.37 224.35 2954.75 3.24 S 1.28 E -3.20 0.14 3051.08 0.35 242.08 3050.86 3.60 S 0.80 E -3.11 0.12 3147.07 0.31 234.82 3146.85 3.89 S 0.33 E -2.98 0.06 3241.90 0.37 215.93 3241.68 4.28 S 0.06 W -2.99 0.13 3338.63 0.44 230.17 3338.41 4.77 S 0.53 W -3.00 0.13 3433.80 0.46 207.29 3433.58 5.35 S 0.98 W -3.09 0.19 3527.21 0.46 225.29 3526.98 5.94 S 1.42 W -3.20 0.15 3628.46 0.49 218.68 3628.23 6.57 S 1.98 W -3.25 0.06 3719.73 0.51 231.61 3719.50 7.13 S 2.54 W -3.24 0.13 3816.40 0.59 225.83 3816.16 7.74 S 3.24 W -3.18 0.10 3910.83 0.68 219.79 3910.59 8.51 S 3.94 W -3.23 0.12 4007.62 0.70 220.09 4007.37 9.40 S 4.69 W -3.33 0.02 4102.29 0.71 224.57 4102.03 10.26 S 5.48 W -3.39 0.06 Page 1 of 3 I1ALLIBURTON Merak 1 Measured Vertical Vertical Depth Inclination Direction Depth Latitude Departure Section Dogleg (feet) (degrees) (degrees) (feet) (feet) (feet) (feet) (deg/100ft) 4197.60 0.71 220.92 4197.33 11.13 S 6.28 W -3.43 0.05 4294.41 0.79 216.96 4294.14 12.12 S 7.07 W -3.57 0.10 4389.95 0.51 201.65 4389.67 13.04 S 7.62 W -3.83 0.34 4485.57 0.55 196.80 4485.29 13.87 S 7.91 W -4.21 0.06 4581.52 0.57 218.74 4581.23 14.69 S 8.35 W -4.48 0.22 4676.26 1.06 12.43 4675.97 14.20 S 8.45 W -4.06 1.68 4771.61 1.57 17.43 4771.29 12.09 S 7.87 W -2.98 0.55 4868.13 1.58 17.62 4867.77 9.56 S 7.07 W -1.76 0.01 4967.66 1.58 17.07 4967.27 6.94 S 6.25 W -0.49 0.02 5059.71 1.60 16.57 5059.28 4.50 S 5.51 W 0.72 0.03 5155.87 1.09 5.16 5155.41 2.30 S 5.05 W 1.95 0.60 5250.98 1.05 7.41 5250.51 0.53 S 4.86 W 3.06 0.06 5347.19 0.81 24.77 5346.71 0.96 N 4.46 W 3.83 0.38 5443.81 0.84 93.27 5443.32 1.54 N 3.46 W 3.54 0.96 5539.58 0.84 83.88 5539.08 1.57 N 2.06 W 2.57 0.14 5637.34 0.82 95.80 5636.83 1.58 N 0.66 W 1.58 0.18 5731.28 0.82 90.17 5730.76 1.51 N 0.68E 0.58 0.09 5827.48 0.83 100.25 5826.95 1.38 N 2.06E -0.48 0.15 5923.32 0.82 83.65 5922.78 1.33 N 3.42 E -1.48 0.25 6018.45 0.79 89.08 6017.90 1.42 N 4.76 E -2.36 0.09 6116.64 0.60 251.70 6116.09 1.27 N 4.94 E -2.60 1.40 6209.50 0.82 255.20 6208.94 0.95 N 3.84 E -2.05 0.24 6305.63 0.88 247.54 6305.06 0.49 N 2.49 E -1.42 0.13 6401.70 0.79 246.95 6401.12 0.05 S 1.20E -0.89 0.09 6497.54 0.76 241.08 6496.95 0.62 S 0.04 E -0.46 0.09 6593.78 0.77 241.61 6593.18 1.23 S 1.09 W -0.10 0.01 6688.62 0.83 247.81 6688.01 1.80 S 2.29 W 0.35 0.11 6783.74 0.82 247.83 6783.12 2.31 S 3.56 W 0.88 0.01 6879.13 0.84 251.69 6878.50 2.79 S 4.85 W 1.46 0.06 6974.46 0.78 252.32 6973.82 3.21 S 6.13 W 2.07 0.06 7069.90 0.89 249.07 7069.25 3.67 S 7.44 W 2.67 0.13 7166.22 0.90 257.03 7165.56 4.11 S 8.88 W 3.38 0.13 7260.54 0.76 262.84 7259.87 4.35 S 10.22 W 4.15 0.17 7357.34 0.85 273.49 7356.66 4.39 S 11.58 W 5.08 0.18 7453.71 1.03 285.29 7453.02 4.11 S 13.12 W 6.37 0.27 7548.95 1.13 290.38 7548.24 3.56 S 14.83 W 7.97 0.15 7646.60 0.86 299.00 7645.88 2.87 S 16.37 W 9.55 0.32 7740.99 0.22 290.00 7740.26 2.47 S 17.16 W 10.39 0.68 7836.58 0.43 303.43 7835.85 2.21 S 17.64 W 10.91 0.23 7932.33 0.60 311.72 7931.60 1.67 S 18.31 W 11.76 0.19 8027.48 0.89 329.92 8026.74 0.70 S 19.05 W 12.98 0.39 8123.65 1.71 329.47 8122.88 1.18 N 20.16 W 15.09 0.85 8219.23 3.72 335.07 8218.35 5.22 N 22.19 W 19.38 2.12 8315.30 6.59 330.64 8314.02 12.85 N 26.20 W 27.62 3.01 8409.62 7.97 329.63 8407.58 23.21 N 32.16 W 39.16 1.47 8505.46 9.18 330.28 8502.35 35.58 N 39.31 W 52.96 1.27 8601.96 8.67 329.33 8597.68 48.53 N 46.84 W 67.43 0.55 8687.33 8.07 330.88 8682.14 59.29 N 53.04 W 79.43 0.75 8781.38 7.74 332.25 8775.29 70.67 N 59.20 W 91.83 0.40 8877.25 7.22 333.97 8870.35 81.79 N 64.85 W 103.69 0.59 8973.57 6.54 337.36 8965.97 92.29 N 69.62 W 114.49 0.82 9070.51 6.48 336.05 9062.29 102.39 N 73.96 W 124.70 0.17 9162.59 6.36 335.60 9153.79 111.78 N 78.18 W 134.32 0.14 9256.81 5.56 335.58 9247.50 120.69 N 82.22 W 143.48 0.85 9355.27 5.22 334.91 9345.53 129.09 N 86.09 W 152.16 0.35 Date Printed:05 October 2012 Page 2 of 3 HALLIBURTON Merak 1 Measured Vertical Vertical Depth Inclination Direction Depth Latitude Departure Section Dogleg (feet) (degrees) (degrees) (feet) (feet) (feet) (feet) (deg/100ft) 9451.76 4.21 334.58 9441.69 136.26 N 89.48 W 159.62 1.05 9546.61 3.98 333.26 9536.30 142.35 N 92.45 W 166.03 0.26 9640.62 3.98 333.34 9630.08 148.18 N 95.38 W 172.22 0.01 9736.66 3.86 331.15 9725.90 153.99 N 98.44 W 178.49 0.20 9834.22 3.74 329.64 9823.24 159.61 N 101.63 W 184.73 0.16 9927.04 3.71 328.57 9915.87 164.78 N 104.73 W 190.57 0.08 10025.79 3.54 330.01 10014.42 170.15 N 107.92 W 196.62 0.20 10117.76 3.41 329.16 10106.22 174.96 N 110.74 W 202.02 0.15 10213.98 3.39 332.08 10202.27 179.93 N 113.54 W 207.51 0.18 10312.43 3.30 333.15 10300.55 185.03 N 116.18 W 212.99 0.11 10408.97 3.21 332.43 10396.94 189.90 N 118.69 W 218.21 0.10 10501.20 3.21 331.28 10489.02 194.46 N 121.12 W 223.15 0.07 10560.93 3.21 331.64 10548.66 197.40 N 122.72 W 226.36 0.03 10577.79 3.32 332.40 10565.49 198.24 N 123.17 W 227.27 0.70 10673.10 3.03 336.24 10660.65 203.00 N 125.46 W 232.26 0.38 10767.67 3.06 336.16 10755.09 207.59 N 127.49 W 236.94 0.03 10865.00 3.35 335.85 10852.27 212.56 N 129.70 W 242.02 0.30 10959.55 2.44 356.84 10946.70 217.09 N 130.95 W 246.10 1.46 10993.28 2.64 0.62 10980.40 218.59 N 130.98 W 247.18 0.77 11094.00 2.64 0.62 11081.01 223.23 N 130.93 W 250.42 0.00 CALCULATION BASED ON MINIMUM CURVATURE METHOD SURVEY COORDINATES RELATIVE TO WELL SYSTEM REFERENCE POINT TVD VALUES GIVEN RELATIVE TO DRILLING MEASUREMENT POINT VERTICAL SECTION RELATIVE TO WELL HEAD VERTICAL SECTION IS COMPUTED ALONG A DIRECTION OF 315.00 DEGREES(TRUE) A TOTAL CORRECTION OF 20.75 DEG FROM MAGNETIC NORTH TO TRUE NORTH HAS BEEN APPLIED HORIZONTAL DISPLACEMENT IS RELATIVE TO THE WELL HEAD. HORIZONTAL DISPLACEMENT(CLOSURE)AT 11094.00 FEET IS 258.79 FEET ALONG 329.61 DEGREES(TRUE) Surveys are SAG corrected. Final survey is projected to TD. Date Printed:05 October 2012 Page 3 of 3 • • Carlisle, Samantha J (DOA) From: French, Hollis(DOA) Sent: Monday, October 16, 2017 9:21 AM To: Carlisle, Samantha i (DOA) Subject: FW: Great Bear confidentiality Sam, Print this and put a copy in each of the Great Bear sundries. thanks Original Message From:French,Hollis(DOA) Sent:Friday,October 13,2017 3:21 PM To:Seamount,Dan T(DOA) <dan.seamount@alaska.gov> Cc:Foerster,Catherine P(DOA) <cathy.foerster@alaska.gov>;Ballantine,Tab A(LAW) <tab.ballantine@alaska.gov>; Davies,Stephen F(DOA) <steve.davies@alaska.gov> Subject:Great Bear confidentiality I heard back from Pat Galvan that the request for confidentiality in their sundries was an oversight.That is,they recognize there is no need for confidentiality. Hollis Sent from my iPhone 1 0 601 W. 5th Ave,Ste.50:, 0(907)868-8070 elf� Anchorage,AK 99501 0(907)891-9700 0 www.greatbearpetro.com 01 I August 4, 2017 Nate Emery Alaska Department of Natural Resources Division of Oil and Gas SCANNED AUG 16 2017, 550 W 7th Ave, Ste 1 100 Anchorage, AK 99501-3560 Re: Plan of Ops Supplement- P&A of Alcor and Merak Wells Dear Nate, This letter accompanies a detailed description of our scheduled activities to plug and abandon ("P&A") the Alcor #1 and Merak #1 wells later this summer. These operations will be conducted under approved Plan of Operations LONS 11-007. The accompanying supplement provides additional information about the P&A and site remediation operations. We are seeking clarification from DNR-DOG regarding the site remediation requirements for these particular sites. Please review the supplemental information and provide guidance on the site remediation requirements. Sincerely yours, Great Bear Petroleum / - Patrick S. Galvin Chief Commercial Officer www.greatbearpetro,corn IFIRk &ret0 601 W. 5th Ave.Ste505 0 (907)868-8070 /j Anchorage.AK 99501 0(907)891-9700 0 www.grealhearpetro.corn August 4, 2017 Plan of Ops Supplement LONS 11 -007 Plug and Abandonment and Site Remediation Procedures Alcor #1 and Merak #1 Great Bear Petroleum ("Great Bear") has determined that the suspended wells, Alcor #1 and Merak #1, will not be put into production. Therefore, Great Bear is commencing operations to plug and abandon ("P&A") the two wells and restore the drill sites. This document is to serve as a supplement to the approved Plan of Operations ("PoO"), specifically Section 6.2, to provide greater detail on the plug and abandonment and site restoration operations. General Overview The Alcor#1 and Merak #1 locations were constructed in 2012, approximately 17 miles south of Prudhoe Bay, off the Dalton Highway. The previously disturbed upland pad areas were leveled by removing natural, inconsistent elevations in the terrain and then covering the exposed soil with rig mats. The rig mats have since been removed from location, leaving the leveled ground exposed. Below are aerial schematics of the sites that can provide rough location sizes. Sequence of Activities Site evaluations will be performed prior to project commencement to determine the current condition of each location. Rig mats will be laid to support equipment that will be used for the P&A portion of the program. Following the P&A activities, the sites will be remediated to the satisfaction of DNR. This document includes proposed remediation activities, but we will work with DNR to determine the specific activities that will be required. It is our intention to perform this program in the summer of 2017, approximately in the months of August and September. P&A Activities The following equipment will be used for the P&A portion of the program: • Wireline unit • Slickline unit 0 601 W.5th Ave,Ste.505 ©(907)862-8070 Anchorage,AK 99501 0(907)891-9700 0 www.greatbearpetro.com • Cement unit • Vac truck • Loader • Water tanker truck • Crane (if necessary) • Rig Mats The P&A operations will be conducted in compliance with AOGCC regulations. Each well will be properly plugged, and the wells cut off and capped below grade. The site remediation activities will take place immediately after the P&A operations are competed at each location. Drill Pad Remediation Activities Upon completion of P&A operations, Great Bear will remove all equipment for that portion of the program and will proceed with rem ediation of the pads to their original state, prior to our operations. The following equipment will be used for the remediation portion of the program: • Tractor • Grader • K-Line Trailer • Dozer • Loader • Seed Spreader • 30 CY End Dump The proposed procedures related to remediation of the two drill sites are below. Ultimately, they will be remediated as directed by DNR. Great Bear recognizes that DNR must initially make a determination whether the sites are to be re-covered by native vegetation. The following proposed procedures are based on the assumption that DNR will require the sites to be re- vegetated. However, it should be noted that each site has been flooded multiple times over the past several years. Therefore, any re-vegetation effort will be challenging. Upon completion of the primary remediation efforts, the appropriate state departments will be notified for inspection. Alcor Remediation 1 . Remove existing gravel ramps to pad and redistribute to existing roads within a 2-mile area or stockpile at a similar location for future use 2. It is estimated there is -300CY of gravel that will need to be removed 3. Remove existing fabric placed under the ramps 4. If required, in June 2018, hydo-seed all disturbed areas which is estimated at -3.5 acres. www.gr•a tbearpetro,com 0 601 W. 5th Ave,Ste 505 0(907)868-8070 e Anchorage,AK 99501 0(907)891-9700 404e !/Ri Q www.greatbearpetro.com Alcor: Estimated to be about 150,000 sq. ff. of disturbed area. 4,.,,.., fir. ' . t ,��." My •3 r'., 4 "kx k r r , �} , .," .• : - (~ 1 ' 't , T.-. i Ati 1i', rte 1' --. 41 it W t ila3ail .„ ' r— iAw t ; st l-Study Area Boundary Trans Alaska Pipeline UAckland r..._... Alcor sI Great Bear Pelruteunr LLC / Plan of Oper atoms ( L,. . _ .c•».vr.�row -+ Merak Remediation 1 . Remove existing gravel ramps to pad and redistribute to existing roads within a 2-mile area or stockpile at a similar location for future use 2. It is estimated there is -900CY of gravel that will need to be removed 3. Remove existing fabric placed under the ramps 4. If required, in June 2018, hydo-seed all disturbed areas which is estimated at -2.3 acres. 3 0 601 W. 5th Ave,Ste.50S Q(907)868-8070 t'reiteir Anchorage.AK 99501 0(907)891-9700 0 www.greatbearpetro.com Merak: Estimated to be about 100,000 sq. ft. of disturbed area. 4104 ' MERAK#1 t i ' • •r . f p ,Way-rea Boundary Trans Alaska f q:ee (.`.._t Aetlanci Metals Al Great Beat Petroleum LLC Plan nt Operaborn ABRG Unarm Iliervio.. Soil Testing Great Bear will test 4 separate soil samples for fuels analyses at each pad (2 samples in the pad where the drilling took place and 2 samples in the ramps that will be removed). Samples will be kept at the required temperature and shipped to a laboratory in Anchorage for analysis of gasoline range organics (GRO), diesel range organics (DRO), residual range organics (RRO), methods AK101 , 102, and 103. Samples will be collected in the gravel, just above tundra. Lab results will be provided with a summary memorandum. www.greatbearpetro,com 4 0 601 W. 5th Ave,Ste.50s Q(907)868-8070 �_ Anchorage,AK 99501 0(907)891.9700 f Q www.greatbearpetro.com Follow-up Monitoring Great Bear will review the remediation of each site in July 2018 and July 2019 and take remedial action to bring the sites into compliance with DNR requirements. www.greatb.arpelro.com 5 • VOF �� �,4\71///1;11,16,?,T ,s� THE STATE Alaska Oil and Gas of TLS�` Conservation Commission _=_ � -1,is ISM - 333 West Seventh Avenue • - � GOVERNOR BILL WALKER Anchorage, Alaska 99501-3572 Main: 907.279.1433 F-4 LAS Fax: 907.276.7542 www.aogcc.alaska.gov July 23, 2015 Mr. Patrick Galvin �`�, — \ o Vice President-External Affairs and Deputy General Counsel Great Bear Petroleum Operating LLC Key Bank Plaza3 2015 601 W. 5th Ave., Suite 505 E© JUL 2 Anchorage, AK 99501 Re: Request for Information - Copies of Well Completion and Recompletion Report and Log Forms • 10-407) Submitted by Great Bear Petroleum Operating LLC for Exploratory Wellicor No. 1 erak No. , and Alkaid No. 1 Dear Mr. Galvin: By email received July 20, 2015, Great Bear Petroleum Operating LLC (Great Bear), current operator for exploratory wells Alcor No. 1, Merak No. 1, and Alkaid No. 1, requests the Alaska Oil and Gas Conservation Commission (AOGCC) provide copies of the Well Completion and Recompletion Report and Log Forms (Form 10-407) submitted by Great Bear to the AOGCC for wells Alcor No. 1, Merak No. 1, and Alkaid No. 1. Great Bear requests specifically that these copies display the date that each form was received by the AOGCC. Well records for Alcor No. 1 and Merak No. 1 have been released to the public domain. Well records for Alkaid No. 1 are currently held confidential under Alaska Statute AS 31.05.035 and Regulation 20 AAC 25.537. AOGCC is providing this confidential information, as a courtesy to Great Bear, for Great Bear to use as it sees fit. Please call Mr. Steve Davies at (907) 793-1224 if you have questions concerning this request for information. Sincerely, Cathy P. Foerster Chair, Commissioner Attachments: Well Completion and Recompletion Report and Log Forms(Form 10-407)for Alcor No. 1,Merak No. 1, and Alkaid No. 1 STATE OF ALASKA ,,* SEP 10 2012 ALASKA OIL AND GAS CONSERVATION COMMISSION la. CWell StaWEoLL❑ COMGas ❑PLETIIOSPLUG❑N OReRr ❑ECOMPLAbandoned ❑ETION ndeSPORT N lb.Well IANI L& 2OAAC 25.105 20aac 25.110 Development ❑ Exploratory GINJ ❑ WINJ❑ WAG❑ WDSPL❑ .5: Service ❑ Stratigraphic Test❑ 2.Operator Name: '5.Date Comp.,Susp.,or 12.Permit to Drill Number: Great Bear Petroleum Operating LLC Aband.: 8/11/2012 • 212-057 • 3.Address: 6.Date Spudded: 13.API Number: 601 W.5th Ave,Suite 505,Anchorage,Alaska 99501 6/19/2012 • 50-223-20026-00-00 , 4a. Location of Well(Governmental Section): 7.Date TD Reached: 14.Well Name and Number: Surface: 2769'FSL,549'FEL,Sec 5,T7N,R14E,UM • 8/6/2012 • Alcor#1 • Top of Productive Horizon: 8.KB(ft above MSL):. 15.5Field/Pool(s): 2538'FSL,562'FEL,Sec 5,T7N, R14E,UM GL(ft above MSL):t1ib �Y�1 Exploration Total Depth: 9.Plug Back Depth(MD+TVD): g 2533'FSL,567'FEL,Sec 5,T7N,R14E,UM 10,665'MD,10,655'TVD 4b. Location of Well(State Base Plane Coordinates,NAD 27): 10.Total Depth(MD+TVD): 16. Property Designation: Surface: x- 665,672.49 • Y- 5,847,838.30 • Zone- 7 P 10,812'MD,10,802'TVD • ADL 391706 • TPI: x- 665,663.97 Y- 5,847,604.98 Zone- 7 11.SSSV Depth(MD+TVD): 17. Land Use Permit: Total Depth: x- 665,662.56 Y- 5,847,600.21 Zone- 7 N/A N12-071 18. Directional Survey: Yes El No ❑ 19.Water Depth,if Offshore: 20.Thickness of Permafrost MD/TVD: (Submit electronic and printed information per 20 AAC 25.050) N/A (ft MSL) 1,050' 21. Logs Obtained(List all logs here and submit electronic and printed information per 20AAC25.071): 22.Re-drill/Lateral Top Window MD/TVD: Resistivity,Array Sonic, Neutron, Density,WaveSonic,OMRI,GR,PWD,CSGR,CBL N/A 23. CASING,LINER AND CEMENTING RECORD WT.PER SETTING DEPTH MD SETTING DEPTH ND AMOUNT CASING GRADE TOP BOTTOM TOP BOTTOM HOLE SIZE CEMENTING RECORD FT. PULLED 16" Surface 79' Surface 79' 16" Grouted to surface 0' 9-5/8" 47# L-80 Surface 2,491' Surface 2,491' 12-1/4" 400 bbls PF+51 bbls G 0' 7" 29# P-110 Surface 8,311' Surface 8,311' 8-1/2" 119 bbls PF+32 bbls G 0' 4-1/2" 13.5# P-110 7,983' 10,753' 7,983' 10,743 6-1/8" 57.3 bbls Class G 0' 24.Open to production or injection? Yes❑ No0 If Yes,list each 25. TUBING RECORD interval open(MD+TVD of Top&Bottom; Perforation Size and Number): SIZE DEPTH SET(MD) PACKER SET(MD/TVD) No tbg in well d COWL 11014t 26. ACID,FRACTURE,CEMENT SQUEEZE,ETC. DEPTH INTERVAL(MD) AMOUNT AND KIND OF MATERIAL USED None ? 1 27. PRODUCTION TEST Date First Production: Method of Operation(Flowing,gas lift,etc.): Not yet tested Date of Test: Hours Tested: Production for Oil-Bbl: Gas-MCF: Water-Bbl: Choke Size: Gas-Oil Ratio: Test Period Flow Tubing Casing Press: Calculated Oil-Bbl: Gas-MCF: Water-Bbl: Oil Gravity-API(corr): Press. 24-Hour Rate i..0. 28. CORE DATA Conventional Core(s)Acquired? Yes CI No❑ • Sidewall Cores Acquired? Yes❑ No 0 • If Yes to either question,list formations and intervals cored(MD+TVD of top and bottom of each),and summarize lithology and presence of oil,gas or water (submit separate sheets with this form,if needed). Submit detailed descriptions,core chips,photographs and laboratory analytical results per 20 AAC 25.071. Submitted separately RaDMS SEP 11 2011 4 AA L Form 10-407 Revised 12/2009 CONTIN t A Submit original only STATE OF ALASKA ALASKA OIL AND GAS CONSERVATION COMMISSION WELL COMPLETION OR RECOMPLETION REPORT AND LOG 1a.Well Status: Oil❑ Gas ❑ SPLUG❑ Other ❑ Abandoned ❑ Suspended0• 1b.Well Class: 20AAC 25 105 20AAC 25 110 Development ❑ Exploratory 0• GINJ ❑ WINJ❑ WAG❑ WDSPL❑ No.of Completions: Service ❑ Stratigraphic Test❑ 2.Operator Name: 5.Date Comp.,Susp.,or 12.Permit to Drill Number: Great Bear Petroleum Operating LLC Aband.: Susp.10116/12 212-101 • 3.Address: 6.Date Spudded: 13.API Number: 601 W.5th Avenue,Suite 505,Anchorage,Alaska 99501 8/22/2012 50-223-20027-00-00 • 4a. Location of Well(Governmental Section): 7.Date TD Reached: 14.Well Name and Number: Surface: 5009'FEL,44'FSL,Sec.8,T7N,R14E,UM 10/5/2012 Merak#1 • Top of Productive Horizon: 5078'FEL,136'FSL,Sec.8,T7N,R14E,UM 8.KB(ft above MSL): 196 • 15.Field/Pool(s): GL(ft above MSL): 175• Exploration • Total Depth: 5140'FEL,267'FSL,Sec.8,T7N, R14E,UM 9.Plug Back Depth(MD+TVD): 8,582'MD,8,578'TVD 4b.Location of Well(State Base Plane Coordinates,NAD 27): 10.Total Depth(MD+TVD): 16. Property Designation: Surface: x- 661,410.35• y- 5,839,739.79' Zone- 4 •11,094'MD,11,081'TVD• ADL 391706 • TPI: x- 661,341.35 y- 5,839,831.79 Zone- 4 11. SSSV Depth(MD+TVD): 17. Land Use Permit: Total Depth: x- 661,279.35 y- 5,839,962.79 Zone- 4 N/A LONS 11-007 18. Directional Survey: Yes 0 No ❑ 19.Water Depth,if Offshore: 20.Thickness of Permafrost MD/TVD: (Submit electronic and printed information per 20 AAC 25.050) N/A (ft MSL) 739'/739' - 21. Logs Obtained(List all logs here and submit electronic and printed information per 20AAC25.071): 22.Re-drill/Lateral Top Window MD/TVD: Triple Combo,GEM,Array Sonic,Mud Log,PWD,Directional Survey ( No Ci34.) • N/A 23. CASING,LINER AND CEMENTING RECORD WT.PER SETTING DEPTH MD SETTING DEPTH TVD AMOUNT CASING FT. GRADE TOP BOTTOM TOP BOTTOM HOLE SIZE CEMENTING RECORD PULLED 20" 129.45# X-56 Surf. 93' Surf. 93' 26" Grouted to surface 0' 13-3/8" 68# L-80 Surf. 2,447' Surf. 2,447' 16" 361 bbls Lead,82 bbls Tail 0' 9-5/8" 47# L-80 Surf. 8,727' Surf. 8,721' 12-1/4" 556 bbls Lead,78 bbls Tail 0' .- Z01 site- ((40 Bots) 24.Open to production or injection? Yes illNo 0 • 25. - TUBING RECORD If Yes,list each interval open(MD+TVD of Top and Bottom;Perforation SIZE DEPTH SET(MD) PACKER SET(MD/TVD) Size and Number): 2-7/8" 827' N/A 26. ACID,FRACTURE CEMENT SQUEEZE,ETC. RECEIVED' e C E I V E Was hydraulic fracturing used during completion? Yes❑ No 0 -- - _---,, is DEPTH INTERVAL(MD) AMOUNT AND KIND OF MATERIAL USED 1.',0: PLED ,: s N/A NOV 13 2012 t . ►r4u r AOG 27. PRODUCTION TEST Date First Production: Method of Operation(Flowing,gas lift,etc.): Well not yet tested Date of Test: Hours Tested: Production for Oil-Bbl: Gas-MCF: Water-Bbl: Choke Size: Gas-Oil Ratio: Test Period . . Flow Tubing Casing Press: Calculated Oil-Bbl: Gas-MCF: Water-Bbl: Oil Gravity-API(corr): Press. 24-Hour Rate — 28. CORE DATA Conventional Core(s)Acquired? Yes 0 I No❑ Sidewall Cores Acquired? Yes❑ No 0 . If Yes to either question list formations and intervals cored(MD+TVD of top and bottom of each),and summarize lithology and presence of oil,gas or water (submit separate sheets with this form, if needed).Submit detailed descriptions,core chips,photographs and laboratory analytical results per 20 MC 25.071. Submitted Separately i P; 1k4 MOV/ 14 2011tyt. e* Form 10-407 Revised 10/2012 CONTINUED ON REVERSE //c,/? Submit original only Image Project Well History File Cover Page XHVZE This page identifies those items that were not scanned during the initial production scanning phase. They are available in the original file, may be scanned during a special rescan activity or are viewable 4direct inspection of the file. b icz_ 1 © I Well History File Identifier Organizing (done) ❑ Two-sided ❑ Rescan Needed RES AN: OVERSIZED: NOTES: Colr Items: ❑ Maps: Grayscale Items: ogs: ❑ Poor Quality Originals: ❑ Other: ❑ Other: i BY: Maria Date: 11/17P r, ' /st Project Proofing y BY: al, Date: [ I 9 uh/s/ I Scanning Preparation x 30 = D-70 + t 3 = TOTAL PAGES a U 3 (Count does not include cover sheet) BY: MP Date: ` /s/ Production Scanning / Stage 1 Page Count from Scanned File: �Cr1+(Count does include cover sheet) Page Count Matches Number in Scanning Preparation: YES NO BY: at* Date: 1 I i V 1 Lt. /s/ iv) Stage 1 If NO in stage 1, page(s) discrepancies were found: YES NO BY: Maria Date: /s/ Stage 2 Additional Well Reports: CP NO TOTAL PAGES: Digital version appended by: Meredithao---11.46Michal 1V( � Date: 111,2 LI�QOiq /s/ Final Page Count: Stage 1 + Stage 2: TOTAL PAGES: 3(o Scanning is complete at this point unless rescanning is required. 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(n d W O o - w •/A 1 Y N m.p� . y as g p \ c o 0 Q W c o @ �o C U (I) i E a�0 c -'' ''''. .7.-\--....---.'..) oU l S CO C0 cl- l m CO CO �(� '�� o p p p c I �J N N .a. «a. .@-� C CO CO `\ r .� .0 .0 '� `SCJ 1 O 0 0 0 € a c — m p o O ~ V CO O 1,- c CO - CO '° I.0 In W E n O as C71 N N N d N L W O O I- I d N a a I co - o c F2 ca ai CU 0 v yLa a6I O ` C) a c aorn o Wz 1U U QoF co ¢ oo c 2 46 10 v d gvrn a a UC ° dan E7 E 0 LL E o - i E aE OQ01wWw a 1zca 0 1 v X 0 0 1 Release of Confidential Data Coversheet Well Name: Merak 1 PTD: 212-101 E-Set: 22030, 22074,22268,23195,23453 Vc,."rb t,-," ✓ Physical data labeled with PTD, E-Set# Conf. entry: / / ✓ Import CD data to RBDMS via GeoLogs tab ✓ Confidential (incomplete)entry in Well Data List notes Id' Import to DigLogs via E-Set tab Scan labeled data /Apply OCR text recognition P1 Save to Well Log Header Scans VNew"complete" entry in Well Data List notes Logged by: Meredith Guhl Fully logged: 1/ /11 / Ai 212- 71 ,(7 150q Z (ow(e S 4 2t 2- 10I- 15 o5 a 1 (Oozes Great Bear Petroleum Operating LLC 601 W, 5e' Ave., Suite 505, Anchorage, AK 99501 Phone: (907) 868-8070, Fax: (907) 868-3887 October 28, 2014 Meredith Guhl Petroleum Geology Assistant Alaska Oil and Gas Conservation Commission 333 W. 7th Ave, Suite 100, Anchorage, AK 99501 Dear Ms. Guhl: This letter accompanies 6 boxes containing the core chip samples for the Alcor #1 and Merak #1 wells. If you have any questions or concern at any time, please do not hesitate to call me. Sincerely, Great Bear Petroleum Operating LLC Patrick S. Galvin Vice President-External Affairs& Deputy General Counsel RECEIVED CONFIRMATION OF RECEIPT OCT 2 8 r 0(26 / AOGCC WAIL e ( eceived By - Date RECEIVED OCT 2 8 2014 Bringinc,the Unconventional Resource Play to Alaska AOGGC Packing Slip /1'2--101 Alaska Core Samples Merak 1 1505- Merak 1 Core 1 Merak 1 Core 2 Merak 1 Core 2 Merak 1 Core 3 Merak 1 Core 3 _ 9013 9028 9073 10611 10656 9014 9029 9074 10612 10657 9015 9030 9075 10613 10658 9016 9031 9076 10614 9017 9032 9077 10615 9018 9033 9078 10616 9019 9034 9079 10617 9020 9035 9080 10618 9021 9036 9081 10619 9022 9037 9082 10620 9023 9038 9083 10621 9024 9039 9084 10622 9025 9040 9085 10623 9026 9041 9086 10624 9042 9087 10625 9043 9088 10626 9044 9089 10627 9045 10628 9046 10629 9047 10630 9048 10631 9049 10632 9050 10633 9051 10634 No Sample 9052 10635 9053 10636 9054 10637 9055 10638 9056 10639 9057 10640 9058 10641 9059 _ 10642 9060 10643 9061 10644 9062 10645 9063 10646 9064 10647 9065 10648 9066 10649 9067 10650 9068 10651 9069 10652 9070 10653 9071 10654 9072 10655 I acL Packing Slip Alaska core samples Merak 1 Merak 1 Core 4 (FT.) Merak 1 Core 4 (Ft.) Merak 1 Core 5 (Ft.) 10659 10705 10750 10660 10706 10751 10661 10707 10662 10708 10663 10709 10664 10710 10665 10711 10666 10712 10667 10713 10668 10714 10669 10715 10670 10716 10671 10717 10672 10718 10673 10719 10674 10720 10675 10721 10676 10722 10677 10723 10678 10724 10679 10725 10680 10726 10681 10727 10682 10728 10683 10729 10684 10730 10685 10731 10686 10732 10687 10733 10688 10734 10689 10735 10690 10736 10691 10737 10692 10738 10693 10739 10694 10740 10695 10741 10696 10742 10697 10743 10698 10744 10699 10745 10700 10746 10701 10747 10702 10748 10703 10749 10704 Packing Slip Alaska core Samples Merak 1 Merak 1 Core 6 (Ft.) Merak 1 Core 6 (Ft.) Merak 1 Core 6 (Ft.) 10754 10799 10844 10755 10800 10845 10756 10801 10757 10802 10758 10803 10759 10804 10760 10805 10761 10806 10762 10807 10763 10808 10764 10809 10765 10810 10766 10811 10767 10812 10768 10813 10769 10814 10770 10815 10771 10816 10772 10817 10773 10818 10774 10819 10775 10820 10776 10821 10777 10822 10778 10823 10779 10824 10780 10825 10781 10826 10782 10827 10783 10828 10784 10829 10785 10830 10786 10831 10787 10832 10788 10833 10789 10834 10790 10835 10791 10836 10792 10837 10793 10838 10794 10839 10795 10840 10796 10841 10797 10842 10798 10843 10799 Packing Slip Alaska Core Samples Merak 1 Merak 1 Core 7(Ft.) Merak 1 Core 7(Ft.) 10846 10892 10847 10893 10848 10894 10849 10895 10850 No Sample 10896 10851 No Sample 10897 10852 No Sample 10898 10853 No Sample 10899 10854 No Sample 10900 10855 No Sample 10901 10856 No Sample 10902 10857 No Sample 10903 10858 No Sample 10904 10859 No Sample 10905 10860 No Sample 10906 10861 No Sample 10907 10862 10908 10863 10909 10864 10910 10865 10911 10866 10912 10867 10913 10868 10914 10869 10915 10870 10916 10871 10917 10872 10918 10873 10919 10874 10920 10875 10921 10876 10922 10877 10923 10878 10924 10879 10925 10880 10926 10881 10927 10882 10928 10883 10929 10884 10930 10885 10931 10886 10932 10887 10933 10888 10934 10889 10935 10890 No Sample 10936 10891 Guhl, Meredith D (DOA) From: Decker, Paul L (DNR) Sent: Monday, October 20, 2014 11:40 AM To: Guhl, Meredith D (DOA) Cc: Bettis, Patricia K(DOA); Davies, Stephen F (DOA) Subject: RE: Extended Confidentiality Merak 1, PTD 212-101 Hello Meredith, No,there has been no request for extended confidentiality on Merak 1. Thanks, -Paul Paul L.Decker,Petroleum Geologist Resource Evaluation Manager Alaska Division of Oil&Gas 550 W.7th Ave,Ste. 1100 Anchorage,AK 99501 (907)269-8791 paul.decker@alaska.gov 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 Paul Decker at(907) 269-8791 or paul decker@alaska.gov. From: Guhl, Meredith D (DOA) Sent: Monday, October 20, 2014 11:24 AM To: Decker, Paul L(DNR) Cc: Bettis, Patricia K (DOA); Davies, Stephen F (DOA) Subject: Extended Confidentiality Merak 1, PTD 212-101 Hello Paul, Merak 1, PTD 212-101, is due for release on 11/16/2014. Has there been a request for extended confidentiality for this well? Thank you, Meredith Meredith Guhl Petroleum Geology Assistant Alaska Oil and Gas Conservation Commission 333 W. 7th Ave, Suite 100,Anchorage,AK 99501 meredith.guhl@alaska.gov Direct: (907)793-1235 CONFIDENTIALITY NOTICE:This e-mail message,including any attachments,contains information from the Alaska Oil and Gas Conservation Commission(AOGCC),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 AOGCC is aware of the mistake in sending it to you,contact Meredith Guhl at 907-793-1235 or meredith.guhl@alaska.gov. 1 RECEIVED WELL DATA TRANSMITTAL OCT 2 8 2013 AOGCC To: State of Alaska October 24, 2013 Alaska Oil and Gas Conservation Commission 2..\2'k 0\ Attn.: Makana Bender 333 West 7th Avenue, Suite 100 Zc�A5.3 Anchorage,Alaska 99501-3539 RE: Merged LWD&Wireline data for Merak 1 Per letter from Steve Davies (AOGCC) to Ed Duncan (Great Bear Petroleum) dated 10/2/13. Merak 1 50-223-20027-00-00 2"x 5" MD Triple Combo Logs: 1 Color Log 2"x 5"TVD Triple Combo Logs: 1 Color Log 2"x 5" MD Triple Combo + BAT Logs: 1 Color Log 2"x 5"TVD Triple Combo + BAT Logs: 1 Color Log Digital Log Images,las&dlis data 1 CD ROM PLEASE ACKNOWLEDGE RECEIPT BY RETURNING A SIGNED COPY OF THIS TRANSMITTAL LETTER TO SPERRY DRILLING: Sperry Drilling Attn: Buster Bryant 6900 Arctic Blvd. Anchorage,Alaska 99518 Office: 907-273-3539 Fax: 907-273-3535 Buster.Bryant@halliburton.com Date: %a 161/‘S Signed: 1 Page 1 of 2 Okland, Howard D (DOA) From: Ed Duncan [Ed@greatbearpetro.com] Sent: Tuesday, September 10, 2013 11:14 AM To: Okland, Howard D (DOA) Subject: RE: ETA for the delivery of Core Chips to the AOGCC Howard, We are aiming for end of October for the current round of analytical work. That said, we are competing for lab time with some lower 48 operators which tends to slow us down at times. Edward A. Duncan President&CEO Great Bear Petroleum Operating LLC Email: ed@greatbearpetro.com Mobile: (907) 341-9355 Office: (907) 868-8070 Fax: (907) 868-3887 Website: www.greatbearpetro.com Address: 601 W. 5th Ave, Suite 505, Anchorage, AK 99501 This electronic message contains information from the legal department of Great Bear Petroleum Operating LLC. The contents may be privileged and confidential and are for the use of the intended addressee(s) only. If you are not an intended addressee, note that any disclosure, copying, distribution or use of the contents of this message is prohibited. If you have received this e- mail in error, please contact me at ed@greatbearpetro.com. From: Okland, Howard D (DOA) [mailto:howard.okland@alaska.gov] Sent: Tuesday, September 10, 2013 9:14 AM To: Ed Duncan Subject: RE: ETA for the delivery of Core Chips to the AOGCC Ed, TNX for the reply. Do you have any idea as to when the analysis will be finished and we can expect delivery of the core chip samples? I realize that the Lab may not know when they will be finished, but any estimate would be helpful. Howard From: Ed Duncan [mailto:Ed(hgreatbearpetro.com] Sent: Tuesday, September 10, 2013 9:00 AM To: Okland, Howard D (DOA) Subject: RE: ETA for the delivery of Core Chips to the AOGCC Howard, Not sure where "third analysis came from" but Alcor and Merak cores are still in the geochem lab. We have just sampled core plugs and thin sections for physical measurements and sedimentology. If there is something specific you are looking for, let me know. Ed From: Okland, Howard D (DOA) [howard.okland@alaska.gov] 9/10/2013 ate - tU 1 Page 2 of 2 Sent: Tuesday, September 10, 2013 8:48 Al,, To: Ed Duncan Subject: ETA for the delivery of Core Chips to the AOGCC Ed, Good Morning. Do you have an estimate for the delivery of the core chips from Merak#1? The last info that we have ( 8 Aug )was that the cores were undergoing a third analysis. TNX, Howard Okland AOGCC Petroleum Geology Assistant 907 793 1235 9/10/2013 RECEIVED AUG 13 2013 AOGCC ,„ Jegjt -, Great Bear Petroleum Operating LLC A New Direction for the Last Frontier 601 W. 51" Ave., Suite 505, Anchorage, AK 99501. Phone: (907) 868-8070, Fax: (907) 868-3887 August 12, 2013 Howard Okland, Petroleum Geologist Asst. Alaska Oil and Gas Conservation Commission 333 W. 7th Ave., Ste. 100 Anchorage, Alaska 99501 RE: Core Data for Alcor #1 and Merak #1 Dear Mr. Okland: Accompanying this letter are two thumb drives containing certain data required to be submitted for the Alcor #1 and Merak #1 wells. The data set for each well contains the following (with the corresponding regulatory citation): • Core Photos (20 MC 25.071(b)(3)); • Core Descriptions (20 AAC 25.071(b)(3)); and • Shale Rock Properties Report (containing permeabilities, porosities and fluid saturations) (20 MC 25.071(b)(8)(C)). We are still in the process of analyzing the cores, and the core chips required under 20 MC 25.071(b)(4) will be submitted within 30 days of when the analysis is completed. Please let me know if there is any additional data or information you need regarding these wells. Sincerely, Great Bear Petroleum Operating LLC Karen Bryant Duncan Vice President-Corporate, General Counsel& Secretary Bringing the Unconventional Resource Play to Alaska a� Z 161 Page 1 of 1 Okland, Howard D (DOA) From: Bill Penrose [bill@solstenxp.com] Sent: Monday, August 05, 2013 9:55 AM To: Okland, Howard D (DOA) Cc: Davies, Stephen F (DOA) Subject: RE: Core info Not at present. The cores are undergoing their third set of analyses at a third lab and I'm not sure when that'll be completed. c� Peetrt44e Drilling Manager S LSTEN, 'P 406 W. Fireweed Lane,Suite 101 Anchorage,Alaska 99503 Main 907-279-6900 Direct 907-264-6114 Cell 907-250-3113 From: Okland, Howard D (DOA) [mailto:howard.okland@alaska.gov] Sent: Monday, August 05, 2013 9:52 AM To: Bill Penrose Cc: Davies, Stephen F (DOA) Subject: Core info Bill, TNX for the update on the core info for Merak#1. Do you have a timeline for the AOGCC getting core chip samples? TNX Howard 7931235 8/5/2013 Page 1 of 1 Okland, Howard D (DOA) From: Bill Penrose [bill@solstenxp.com] Sent: Friday, August 02, 2013 3:52 PM To: Okland, Howard D (DOA) Subject: Great Bear Petroleum: Merak#1 Core Data Howard, As promised, I'm updating you on progress on getting the core data for the Merak#1 to the Commission. The cores are still undergoing analysis but a great deal of data has been generated to date. I've compiled what we have so far (which I believe is far in excess of what the Commission usually receives) and will have a thumb drive and transmittal letter to you on Monday or Tuesday of next week. The data submitted will contain everything due the Commission with the exception of core chips. The chips will be taken and submitted after the core analyses have been completed. Please give a call with any questions. Regards, Patfrode Drilling Manager X FullColor_sma 406 W. Fireweed Lane,Suite 101 Anchorage,Alaska 99503 Main 907-279-6900 Direct 907-264-6114 Cell 907-250-3113 8/5/2013 7)-nj Z/Z -/ c , 12 PETROLEUM NEWS •WEEK OF SEPTEMBER 25,2011 • EXPLORATION & PRODUCTION Great Bear advances drilling plans Selects drill sites in pre-disturbed,active industrial area along highway,pipeline corridor to minimize environmental impact By KAY CASHMAN gravel roads/pads." Franklin Bluffs camp app withdrawn Petroleum News Great Bear is proposing to extensively use rig mats to protect any undisturbed The previous issue of Petroleum News carries a story about Black Gold Oilfield Services filing for a year-round 100 man camp on the state owned Franklin Bluffs On Sept. 14, Great Bear Petroleum lards.filed a lease plat[of operations with The first wells will be vertical holes gravel pad in support of Great Bear Petroleum's year-round drilling program from the Alaska Department of Natural down to 9,000 to 12,000 feet for coring and October of this year to September 2016.The article was triggered by a Sept 14 public Resources'Division of Oil and Gas,outlin- logging,which will be followed,or inter- notice by the Alaska Department ofNatural Resources'Northern Region Land Office. ing the 2011-12 exploration and evaluation mixed,with drilling"side track wells or lat- Sept.14 is the day Great Bear filed its plan of operations for its`North Slope Alaska ,program for its North Slope unconvention- orals"from those vertical holes to perform 2011-2012 Exploration&Evaluation Program"with DNR's Division of Oil and Gas al resource play,the first of its kind in short-term production flow tests after In its proposal Great Bear says it had been considering a camp at Franklin Bluffs,but Alaska. hydraulic fracturing. ' had decided"for the safety of personnel"to instead use a 65-man camp at the drill site. The independent's six drill sites are The company will rotate through the (It will be moved with the rig.) along a 15-mile long stretch following the drill sites,likely drilling no more than four Black Gold had not actually named Great Bear in its application,which was unusu- Dalton Highway and the trans-Alaska oil vertical wells with one lateral each,taking al,so when the land office called to find out which operator would be using the camp, pipeline,chosen because the corridor is a core samples from the vertical wells for lab Black Gold chief,Jim Huffman,said he had to check with SolstenXP.He then called previously disturbed,active industrial area analysis, and then returning to each of DNR's land office back with Great Bear's name and the notice was posted. with existing access roads and gravel sites, those wells to drill laterals and conduct After seeing the public notice,a Great Bear representative called the land office andthus minimizing the environmental impact hydraulic fracturing and production test- said there was no deal with Black Gold on a camp,reiterating Great Bear's decision to ,of drilling into the underlying source rocks, ing.The order in which drilling and pro- put a 65-man camp on drill site with the rig. mostly shale,that generated the oil and gas duction testing will take place is dependent The land office could not explain what happened and Black Gold pulled it applica- in northern Alaska, including the giant on the analysis of the cores taken from the non. Prudhoe Bay and Kuparuk River fields. wells—analysis that will begin immedi- -KAY CASIIMAN New gravel would be needed for"lean- ately after the first vertical is drilled. sitional driveways between the existing 'Proof of concept'in one year The goal of Great Bear's 2011-12 pro- gram is to achieve"proof of concept"— nabors.com i.e.to demonstrate that the oil and natural gas liquids in its leases are capable of corn- ' mereial production,a process that is less • - about proving the oil is in the source rocks and more about coming up with a well design that can produce commercial quan- tities of oil. • IThere are about 24 authorizations and permits the company had to have to first execute its summer fieldwork program, which has been successfully completed, •' and then to proceed with source rock drilling and evaluation. Great Bear has filed for 13 of those permits and authoriza- tions and received six,with the balance set --f''`h'1_ to be filed on or before Oct.1. 1 Pad construction and gravel repay and ' "'1 ,z..-. �\, I / conditioning work for the first drill pad is A , -- zri expected to start in 1,'_,-_ %--- early to mid-November, - \.-,. . IliLl 1 � with drilling to begin in mid-to-late • - t -. November,and continue on and off for 1 about 12 months. if • Payoff huge for state - Year-round access is standard in all u . w, •" - 1 ' source rock operations and especially criti- } w t r' .-v`c'�J cal for Great Bear,its plan of operations 1 J' ° ti Typical Alaska,winter-only,exploration access involving ice roads and pads will Safer. Smarterthree stretch theexploration and evaluation phase to throe to four years,the company says.That will delay development and get- ting oil in the pipeline,as well as bum up _ f e' Nu-' .1 _' ' S „' 40 percent or more of the seven-year lease t terns.(Half of Great Bear's leases have 4tzk t �^• - 1 seven-year terms; the others, 10 year "r.i! . .. �` Better. tee saysachieving' Great Bear proof of con- rw" A - i A cent in one year and thus being able to pro- t \ , ftIR ceed to field development is important for project economics and for a state with ' Our CDR2-AC rig reflects the latest innovations in Arctic drilling to provide our customers with declining oil production because it can incident free performance and operational and technical excellence. potentially mean hundreds of thousands of CDR2-AC is the first Arctic rig designed and built by Nabors specifically for Coil Tubing Drilling barrels of new,high-quality oil(petroleum operations.The rig was built to optimize CTD managed pressure drilling to provide precise control is cleanest at its source)in the trans-Alaska of wellbore pressures for improved safety,decreased costs,and increased wellbore lengths. pipeline and thousands of new jobs. Combining safety and environmental excellence with greater efficiency means CDR2-AC can deliver According to a North Dakota University the high value results customers have come to expect from Alaska's premier drilling contractor. ' Bakken source rock development created 13,000 new jobs in North Dakota Learn more about Nabors'new drilling technologies at Nabors.com. between 2005 and 2009.That state has one „P- '; yc•.,� _ world class source rock:Alaska has three, wti ; 4d. stacked one on top the other.Great Bear is A NABORS—MISSION TO ZERO looking to eventually develop all of them in its swath of 499,423 acres of state land '"' 111t ".n.. .•. Safer,Smarter-Incident Free see GREAT BEAR PLANS page 13 • IP • PETROLEUM NEWS • WEEK OF SEPTEMBER 2i.,—.1 13 continued from page 12 GREAT BEAR PLANS 1 south of Prudhoe Bay and Kuparuk. Extracting oil from just two of three Deadbo se stacked shale source rocks in Great Bear's 45-year measured drill-out program,can 1,4,44, potentially produce 200,000 barrels per - day by 2020; 350,000 bpd by 2035; 450,000 bpd by 2041;peaking at 600,000 bpd in 2056,with a sustained long-term production of 450,000 barrels per day out - as far as 2074. Named rafter the stars From north to south,the drill sites corn- •..^0 party and state regulatory officials identi- fied in the summer fieldwork program are w.. Alcor No.1,Merak No. 1,Mizar No. 1, Megrez No.I,Dubhe No.I and Alioth No. 1, named after stars within the URSA Major Constellation,i.e.The Great Bear. (See map from Great Bear's Sept.14 filing with this story) In its plan of operations the company says it will be using a 1,500 to 2,000 horse- power rig that can be broken down into creat bear Lease Sleek -- .ra•:ata::.a=pei rte -James Dalton HhenvarMilt . pieces and trucked to and from each loca- . Onlny Location —Secanoery Rood ,� a tion.The name and specifications of the rig • Commonry AMA YAP Ste Mara GMAT BEAN LFASE5 Great here Peeelwen LLC will be given to DNR and the state Per oroo.rekeie Department of Environmental riit nsnew. •..r.. ' "Tei""" Conservation`prior to activity,"Great Bear ...."*"."••• '-- "'-- ` says in its Sept.14 filing. *A....ow,.+,o Company President Ed Duncan told - "----"— -- Petroleum News in a Sept.22 email that Great Bear will not be using Doyon's -- __. --.--! .� Arctic Fox rig,as previously reported by PN.The rig was considered"early on,"but `•"""•'•°"" W^~" "dropped...from contention in July,"he says. R — Resource plops are dFarenf = TIC Proving a resource play, Great Bear - - J'"• says,is different than proving a conven- '- _. " ----. "One exploratory well is generally all E 1194:iY----f that is needed to prove a reservoir or pool exists so that development of a field can - "17--, begin.A north-south transect is required s across Great Bear's leases to test the target- S ed source rocks,calibrate the gas oil ratio , 1 's and determine rmine whether production can be '' 1 _" I PIT _ established at commercial rates,'the com- pany says in its plan of operations. .". _ C.OP Great Bear also says its exploration and --_ evaluation program will not pose the same risk as conventional drilling because liq- Ir,k Notes: 2.Pad h constructed of F-thick wooden olds production from source rocks requires aaa�°KO Layout rig mats.double stacked under au and stimulation to extract oil—specifically, and camp components. 4Wr3att i Access road is existing gravel. the use of fracing and pumping. :: t.•^-••I..-. _ s thick and NY wide. The Alaska Oil and Gas Conservation Commission agrees.The default oil spill response planning standard of 5,500 bar- rels a day for conventional wells in an uncontrolled scenario was reduced by AOGCfLEADER 111 AOGCC forr Great Bears 2011-11p 2 program ' to 500 barrels a day because,in AOGCC's certainty"evidence the standard tate for ..+rrwitiorw"__.114 .. ',,.:� ••«,;. " . able Great Bears wells targeting the HRZ, lag ,� 4 I [,ower Kingak and the Shublik source :.-_ - (•.. (^#►,�� ._ i.. • rocks would produce a rate less than 500kW':III barrels of oil per day for a vertical un-frac- .- .i 1. ' - tured well and less than 1,000 bopd for a vertical fractured well. DOYON,LIMITED,the regional CORPORATE VALUES Great Bear has the support of Gov Native corporation for Interior Alaska Sean's Parnell administration, which is •financially responsible fully behind the increased oil production •Based in the Interior Alaska-growing •pride and respect in Native VI IP f,'i.^ that source rock development has brought across the nation ownership to North Dakota,Texas and other states. The company's contractors include gen- •17,500 shareholders -socially and culturally responsible yf eral SolstenXP;ASRC Energy Services; •commitment to the long-term ��i •Largest private landowner in Alaska Schlumberger;;Jon Iversen,attorney with •honesty and integrity OZ TO Stoel Rives and former director of the tax .Operates a diverse Family of Y 1 division within the Alaska Department of •commitment to excellence Revenue;and Pat Galvin,attorney with Companies and has built a strong reputation in oil field services, -respect for employees Limited K&L Gates and former commissioner of government services,natural resource Revenue.• development and tourism 1 Contact Kay Cashman WWCCW.DOYON .COM • (907) 459-2000 atpublinher@petrok.a,ex',c.com Schwartz, Guy L (DOA) From: Bill Penrose <bill@solstenxp.com> Sent: Wednesday,June 05, 2013 3:06 PM To: Schwartz, Guy L(DOA) Cc: Davies, Stephen F (DOA); Clark Clement Subject: RE: Merak#1 frac sundry (PTD 212-101) Guy, Great Bear agrees and requests to withdraw Sundry No. 312-101 for the frac of a sidetrack of Merak#1. Plans for that sidetrack may change and that frac application is not appropriate at this time. We'll re-apply when plans are more firm. Thanks and regards, Eck avtOde Drilling Manager -,Tc=r"a 'P 406 W. Fireweed Lane,Suite 101 Anchorage,Alaska 99503 Main 907-279-6900 Direct 907-264-6114 Cell 907-250-3113 From: Schwartz, Guy L (DOA) [mailto:guy.schwartz(dhalaska.gov] Sent: Wednesday, June 05, 2013 2:05 PM To: Bill Penrose Cc: Davies, Stephen F(DOA) Subject: Merak #1 frac sundry (PTD 212-101) Bill, I have the sundry pending for the frac on Merak#1 sidetrack(PTD has not been issued) . We have not approved this sundry and I don't see that we can until the well is drilled and completed as proposed (horizontal lateral drilled) . It would be best to withdraw this sundry and resubmit once the well is ready, if at all. Can you request that the sundry(312-277) be withdrawn or have someone from Great Bear request it. Guy Schwartz Senior Petroleum Engineer AOGCC 907-444-3433 cell 907-793-1226 office 212-- 101 2126 WELL LOG TRANSMITTAL To: Alaska Oil and Gas Conservation Comm. February 19, 2013 Attn.: Makana Bender 333 West 7th Avenue, Suite 100 Anchorage, Alaska 99501 RE: Quad Combo/CSNG/GEM: MERAK#1 Run Date: 9/7/2012 The technical data listed below is being submitted herewith. Please address any problems or concerns to the attention of: Klinton Wood, Halliburton Wireline& Perforating, 6900 Arctic Blvd., Anchorage, AK 99518 MERAK#1 Data in LAS format, Digital Log Image files 1 CD Rom 50-223-20027-00 J Borehole Volume Plot Field Print 1 Color Log 50-223-20027-00 'Cross Dipole Wave Sonic Field Print 1 Color Log 50-223-20027-00 Dual Spaced Neutron Spectal Density Array 1 Color Log Comensated True Resistivity 1" = 100'Field Print 50-223-20027-00 Dual Spaced Neutron Spectal Density Array 1 Color Log Comensated True Resistivity 2" = 100' Field Print 50-223-20027-00 \.//Dual Spaced Neutron Spectal Density Array 1 Color Log Comensated True Resistivity 5" = 100' Field Print 50-223-20027-00 Gamma Elements and Minerals 1 Color Log Compensated Spectral Natural Gamma Field Print 50-223-20027-00 J GEM Multi- Mineral Analysis preliminary(Before Core) Processed Print 1 Color Log 50-223-20027-00 J Wavesonic Sembalance Analysis Processed Print 1 Color Log 50-223-20027-00 6000 Plot Field Print 1 Color Log 50-223-20027-00 PLEASE ACKNOWLEDGE RECEIPT BY SIGNING AND RETURNING A COPY OF THE TRANSMITTAL LETTER TO THE ATTENTION OF: Halliburton Wireline &Perforating Attn: Klinton Wood 6900 Arctic Blvd. Anchorage, Alaska 99518 Office: 907-273-3527 Fax: 907-273-3535 klinton.wood@halliburton.com Date: (2� Signed: gel(24ii4VV2) HALLIBURTON Sperry r l l l l To: Alaska Oil and Gas Conversation Commission 333 W 7th Ave Suite 100 Anchorage, AK 99501 Attn: Howard Oakland From: Sperry Drilling - Alaska Attn: Robert Haverfield 6900 Arctic Blvd. Anchorage, AK 99518 907-273-3559 Office 907-273-3535 Fax Robert.Haverfield@Halliburton.com Re: Great Bear Petroleum, LLC Well — Merak 1 AFE # 004 Rig — Nabors 105 Exploration, Alaska Shipment Includes: 1 End of Well Reports ✓ 1 Final Data Listing on CD-ROM .2 2 Q 7y 1 Sets of Final Logs —for each well contains: • 2" Color Log — Formation Evaluation MDLf • 5" Color Log — Formation Evaluation MD Received By: )40w04,4 01-cl A Print Name 1514.4( Sign Name Date Please sign acknowledgement of receipt - email, fax, or mail back. Thank you. J / 01 �2-\0 Qz RECEIVED NOV 20 2012 WELL DATA TRANSMITTAL AOGCC To: State of Alaska November 16,2012 Alaska Oil and Gas Conservation Commission Attn.: Makana Bender 333 West 7th Avenue, Suite 100 Anchorage,Alaska 99501-3539 RE: LWD Formation Evaluation Data: Merak 1 AK-MW-0009498071 Merak 1 50-223-20027-00 2"x 5" MD Triple Combo Logs: 1 Color Log 2"x 5"TVD Triple Combo Logs: 1 Color Log 2"x 5" MD Triple Combo+ BAT Logs: 1 Color Log 2"x 5"TVD Triple Combo + BAT Logs: 1 Color Log Digital Log Images&LAS Data 1 CD ROM PLEASE ACKNOWLEDGE RECEIPT BY RETURNING A SIGNED COPY OF THIS TRANSMITTAL LETTER TO SPERRY DRILLING: Sperry Drilling Attn: Buster Bryant 6900 Arctic Blvd. Anchorage,Alaska 99518 Office: 907-273-3539 Fax: 907-273-3535 Buster.Bryant@halliburton.com Date: \\I2-(r;AZ Signed: `-,- :if, , j j , T .) * 4 : Great Bear Petroleum Operating LLC A New Direction for the Last Frontier 601 W. 51' Ave., Suite 505, Anchorage, AK 99501 Phone: (907) 868 8070, Fax: (907) 868-3887 December 13, 2012 RECEIVED Ms. Cathy Foerster, Chair Alaska Oil and Gas Conservation Commission Nov 13 2012 333 West 7th Ave., Suite 100 Anchorage, Alaska 99501 A AO^� G RE: Well Completion Report: Merak #1 (PTD #212-101) Dear: Ms. Foerster, Great Bear Petroleum Operating LLC hereby submits its Well Completion Report for the work it performed in drilling its Merak #1 well from an onshore gravel pad near the Dalton Highway south of Deadhorse, North Slope, Alaska. Further diagnostic work will be performed in this well as described in detail in subsequent Sundry Application(s) to the Commission. For this reason, the well has not been abandoned and is being left in suspended mode. Please find attached the following information for your review: 1) Form 10-407 Well Completion or Re-completion Report and Log 2) Conductor As-Build Survey 3) Final Wellbore Schematic 4) Drilling Operations Summary 5) Wellbore Directional Survey Well logs, samples and core descriptions will be submitted separately. If you have any questions or require additional information, please contact Bill Penrose at (907) 264-6114 or (907) 250-3113. Bringing the Unconventional Resource Play to Alaska December 13, 2012 Page 2 of 2 Sincerely, Great Bear Petroleum Operating LLC Clark Clement, Chief Operating Officer Attachments Cc: Bill Penrose - SolstenXP Bringing the Unconventional Resource Play to Alaska STATE OF ALASKA ' ALASKA OIL AND GAS CONSERVATION COMMISSION WELL COMPLETION OR RECOMPLETION REPORT AND LOG la.Well Status: Oil❑ Gas ❑ SPLUG❑ Other ❑ Abandoned ❑ Suspended0• lb.Well Class: 20AAC 25105 20AAC 25110 Development ❑ Exploratory 2 • GINJ ❑ WINJ❑ WAG❑ WDSPL❑ No.of Completions: Service ❑ Stratigraphic Test❑ 2.Operator Name. 5.Date Comp.,Susp.,or 12.Permit to Drill Number: Great Bear Petroleum Operating LLC Aband.: Susp.10/16/12 212-101 • 3.Address: 6.Date Spudded: 13.API Number: 601 W.5th Avenue,Suite 505,Anchorage,Alaska 99501 8/22/2012 50-223-20027-00-00 • 4a.Location of Well(Governmental Section) 7.Date TD Reached: 14.Well Name and Number: Surface: 5009'FEL,44'FSL,Sec.8,T7N,R14E,UM 10/5/2012 Merak#1 • Top of Productive Horizon: 5078'FEL,136'FSL,Sec.8,T7N,R14E,UM 8.KB(ft above MSL): 196 • 15.Field/Pool(s): GL(ft above MSL): 175• Exploration• Total Depth: 5140'FEL,267'FSL,Sec.8,T7N,R14E,UM 9.Plug Back Depth(MD+TVD): 8,582'MD,8,578'TVD 4b.Location of Well(State Base Plane Coordinates,NAD 27): 10.Total Depth(MD+TVD): 16.Property Designation: Surface: x- 661,410.35• y- 5,839,739.79• Zone- 4 •11,094'MD,11,081'TVD- ADL 391706 • TPI: x- 661,341.35 y- 5,839,831.79 Zone- 4 11.SSSV Depth(MD+TVD): 17.Land Use Permit: Total Depth: x- 661,279.35 y- 5,839,962.79 Zone- 4 N/A LONS 11-007 18.Directional Survey: Yes E No ❑ 19.Water Depth,if Offshore: 20.Thickness of Permafrost MD/TVD: (Submit electronic and printed information per 20 AAC 25.050) N/A (ft MSL) 739'/739' • 21.Logs Obtained(List all logs here and submit electronic and printed information per 20AAC25.071): 22.Re-drill/Lateral Top Window MD/TVD: Triple Combo,GEM,Array Sonic,Mud Log,PWD,Directional Survey (No C.13(..) • N/A 23. CASING,LINER AND MENTING RECORD WT.PER SETTING DEPTH MD SETTING DEPTH ND AMOUNT CASING FT. GRADE TOP BOTTOM TOP BOTTOM HOLE SIZE CEMENTING RECORD PULLED 20" 129.45# X-56 Surf. 93' Surf. 93' 26" Grouted to surface 0' 13-3/8" 68# L-80 Surf. 2,447' Surf. 2,447' 16" 361 bbls Lead,82 bbls Tail 0' 9-5/8" 47# L-80 Surf. 8,727' Surf. 8,721' 12-1/4" 556 bbls Lead,78 bbls Tail 0' ,r Zwd 514e- C140 56(-5\ 24.Open to production or injection? Yes ❑ No E • 25. TUBING RECORD If Yes,list each interval open(MD+ND of Top and Bottom;Perforation SIZE DEPTH SET(MD) PACKER SET(MD/TVD) Size and Number): 2-7/8" 827' N/A 26. ACID,FRACTURE,CEMENT SQUEEZE, ETC. RECEIVEDWas hydraulic fracturing used during completion? Yes❑ No 0 . - •'- DEPTH INTERVAL(MD) AMOUNT AND KIND OF MATERIAL USED �� 1,. : . . t NOV 13 2012 N/A Op • •P--, li AOGCC 27. PRODUCTION TEST Date First Production: Method of Operation(Flowing,gas lift,etc.): Well not yet tested Date of Test: Hours Tested: Production for Oil-Bbl: Gas-MCF: Water-Bbl: Choke Size: Gas-Oil Ratio: Test Period Flow Tubing Casing Press: Calculated Oil-Bbl: Gas-MCF: Water-Bbl: Oil Gravity-API(corr): Press. 24-Hour Rate — 28. CORE DATA Conventional Core(s)Acquired? Yes E • No❑ Sidewall Cores Acquired? Yes❑ No 0 . If Yes to either question,list formations and intervals cored(MD+TVD of top and bottom of each),and summarize lithology and presence of oil,gas or water (submit separate sheets with this form,if needed) Submit detailed descriptions,core chips,photographs and laboratory analytical results per 20 MC 25.071. Submitted Separately ReCINAS NOV 14 2012 4) Form 10-407 Revised 10/2012 ' CONTINUED ON REVERSE //s-,/J? Submit original only ') I' 29. GEOLOGIC MARKERS (List all formations and markers encountered): 30. FORMATION TESTS NAME MD TVD Well tested?❑ Yes E . No If yes,list intervals and formations tested,briefly summarizing test results.Attach separate sheets to this form,if See Attached needed,and submit detailed test information per 20 MC 25.071. "Merck#1 Geologic Tops" Formation at total depth: Ivishak 31. List of Attachments: Drilling History,Final Wellbore Schematic,Conductor As-Built,Directional Survey 32. I hereby certify that the foregoing is true and correct to the best of my knowledge. Contact: Bill Penrose 264-6114 Email: clarkpgreatbearpetro.Com Printed Name. Clark Cleme t Title: Chief Operating Officer Signature: eldiA4 ' 1• Of Phone: 907-868-8070 Date: f J )l INSTRUCTIONS / General: This form is designed for submitting a complete and correct well completion report and log on all types of lands and leases in Alaska. Submit a well schematic diagram with each 10-407 well completion report and 10-404 well sundry report when the downhole well design is changed. Item lb: Classification of Service wells: Gas Injection,Water Injection,Water-Alternating-Gas Injection,Salt Water Disposal,Water Supply for Injection,Observation,or Other.Multiple completion is defined as a well producing from more than one pool with production from each pool completely segregated. Each segregated pool is a completion. Item 4b: TPI(Top of Producing Interval). Item 8: The Kelly Bushing and Ground Level elevations in feet above mean sea level. Use same as reference for depth measurements given in other spaces on this form and in any attachments. Item 13: The API number reported to AOGCC must be 14 digits(ex:50-029-20123-00-00). Item 20: Report true vertical thickness of permafrost in Box 20. Provide MD and TVD for the top and base of permafrost in Box 28. Item 23: Attached supplemental records for this well should show the details of any multiple stage cementing and the location of the cementing tool. Item 24: If this well is completed for separate production from more than one interval(multiple completion),so state in item 1,and in item 23 show the producing intervals for only the interval reported in item 26. (Submit a separate form for each additional interval to be separately produced,showing the data pertinent to such interval). Item 27: Method of Operation: Flowing,Gas Lift,Rod Pump,Hydraulic Pump,Submersible,Water Injection,Gas Injection,Shut-in,or Other (explain). Item 28: Provide a listing of intervals cored and the corresponding formations,and a brief description in this box. Submit detailed description and analytical laboratory information required by 20 MC 25.071. Item 30: Provide a listing of intervals tested and the corresponding formation,and a brief summary in this box. Submit detailed test and analytical laboratory information required by 20 MC 25.071. Form 10-407 Revised 10/2012 , , Great Bear Petroleum Merak #1 Geologic Tops Formation Tops in Bold Markers in Italics Merak#1 Lat 69.9687133 N, Long 148.7134144 W Elevation KB (RT): 196.32'AMSL, Pad (GL): 174.70' AMSL, Pad to RT 21.62' Formation Tops/Markers Depth Depth (TVD) Depth Zone Thickness (SSTVD) KB Recent/Holocene -196 0 0 484 Gubik 288 484 484 207 Middle Sagavanirktok 495 691 691 1355 Base Permafrost 565 761 761 739 Top Franklin Bluffs Member(Mid Sagavanirktok) 1183 1379 1379 667 Base Franklin Bluffs Member(Middle Sagavanirktok) 1850 2046 2046 Mikkelson Tongue(Upper Canning) 1850 2046 2046 520 Lower Sagavanirktok 2370 2566 2566 1166 Staines Tongue(Lower Sagavanirktok) 3536 3732 3732 1788 Prince Creek 5324 5520 5520 372 Upper Schrader Bluff 5696 5892 5892 1364 Campanian Flooding Surface 7062 7258 7258 Middle Schrader Bluff 7065 7261 7261 131 Lower Canning 7196 7392 7392 1088 MCU(Mid Campanian Unconformity) 8280 8477 8480 Hue Shale 8280 8477 8480 474 Top HRZ(Highly Radioactive Zone) 8750 8947 8954 218 Base HRZ 8967 9163 9172 Pebble Shale 8967 9163 9172 220 LCU(Lower Cretaceous Unconformity) 9186 9382 9392 Kuparuk C (Basal Zone) 9186 9382 9392 21 Kuparuk B 9207 9403 9413 24 Kuparuk A 9231 9427 9437 27 Miluveach 9258 9454 9464 186 Upper Kingak 9443 9639 9650 344 Lower Kingak 9786 9981 9994 225 Lower Kingak(K-1 Top) 10011 10207 10219 506 Lower Kingak Base 10516 10712 10725 Top Shublik 10516 10712 10725 126 Base Shublik 10642 10838 10851 Fire Creek 10642 10838 10851 46 Ivishak 10688 10884 10897 TD 10885 11081 11094 Merak # 1 PH Wellbore Diagram f _ " Diesel Cap ..4r 9 - 5/8" x 13 - 3/8' Casing 20" Conductor @ 93' "'`:' , ` a1 --.--Diesel from 827' to Surface Port Collar @ 500' —� ,1 ii;PO dw;ilt.44 Base Permafrost @ 761' -B►- — �__ 2 - 7/8" Tubing & Diesel 04 @ 827' CO •'� WO 13 - 3/8" Casing — •. Type P ES Stage Tool L- 80, 68 lbs/ft, BTC —� ' 'to% _�-��� w/ Packer @ -�- 2,400' TD @ 2,441' MD/TVD ----- - — — Calc. TOC @ --- 4,600' MD — s 12.2 PPG Mud g ; — pi: from 8'582' to 827' 4 ._. _.._ .4 - *44 $ — . _ . It .j . .,,,. ••„• , ,, ......,,,__— TOC @ 8,582' MD 9 5/8” Casing ,0' 2p�:;1+, dg L- 80, 47 lbs /ft, BTC -o •�►••`��`• 8,736' MD / 8,731' TVD *:+: et o � r jlJ Er- 11/ 6 N s2' A ouzoI2 #14 il / 7 F Apo. Elzt/tAK it, 41 s' / N4H113 IX-CT 10 1, 17 16 LIMI-5 OF ___L..... GRAVEL PAD VICINITY MAP NTS MERAK #1 GATE a►�'‘�fir.OF`4/�9"ii ,w '�P•" S „* •491 /'\ it , gYylf O tY it• ..CYYuia4ot / Y GRAVEL ACCESS ROAD-- 1.- mow.. s ''tchard Allison &` 'alit «•.s,....?a ~ , 44 MERAK #1 \( \ lcI 7eSURVEYOR'S CERTIFICATE I HEREBY CERTIFY THAT I AM PROPERLY REGISTERED AND LICENSED TO PRACTICE LAND SURVEYING IN THE STATE OF ALASKA AND THAT THIS AS-BUILT REPRESENTS A SURVEY MADE BY ME OR UNDER MY DIRECT SUPERVISION AND THAT ALL DIMENSIONS AND OTHER DETAILS ARE CORRECT AS OF AUGUST 16, 2012. MOTES 1. ALASKA STATE PLANE COORDINATES ARE ZONE 4, NAD 27. GEODETIC POSITIONS ARE NAD-27. 2. BASIS OF HORIZONTAL CONTROL IS POINT MI120238, DETERMINED LEGEND BY NGS OPUS STATIC SURVEY SOLUTION. 3. BASIS OF ELEVATION IS POINT MI120238 UTILIZING GEOID 99 UNDULATION -(1}- ASBUILT CONDUCTOR MODEL APPLIED TO NOS OPUS STATIC SURVEY SOLUTION. 4. THE COMBINED SCALE FACTOR FOR MERAK #1 IS 0.99992134. 5. REFERENCE FIELD BOOK: M112-06, PAGE 64-68 6. DATE OF SURVEY: AUGUST 16, 2012. GRAPHIC SCALE 7. APPROXIMATE LOCATION DALTON HWY MP 396.0 \ TAPS MP 21.4. 0 100 200 400 t 1 ( IN FEET ) 1 inch -200 ft. LOCATED WITHIN PROTRACTED SEC. 8, T. 7 N., R. 14 E., UMIAT MERIDIAN, ALASKA WELL A.S.P. PLANT GEODETIC GEODETIC CELLAR SECTION NO. COORDINATES COORDINATES POSITION(DMS) POSITION(D.DD) BOX ELEV. OFFSETS MERAK #1 Y=5,839,739.79 N N/A 69'58'07.368" 69.9687133' 174 7' 44' FSL X= 661,410.35 E N/A 148'42'48.292" 148.7134144' 5009' FEL [ ONAteri HACJ mincers `,MAN GREAT BEAR PETROLEUM _..—— OPERATING, LLC 8 a.84106./12 .�......__.............� _ __._...._._........._.............___...__.........�_._.._..._ FR812 GBP 11 S.FFT- JOB NO GREAT BEAR PETROLEUM, LLC WELL MERAK #1 KxrI" .INMIWIs __�.....,—. 1 1 _ Z�, CONDUCTOR AS—BUILT 1 °F 1 M4.,,,.)A11< REVISION 9Y r Y Great Bear Petroleum Merak #1 Drilling History August 20,2012 52' MW ----ppg Vis -- sec Incl ----° Accept rig at 1800 hrs. Unload mud products. PU DP from pipe shed, MU in stands and stand back in derrick. Tag up at 52' inside of conductor. Function test diverter. Finish building berms around rig components. August 21, 2012 318' MW 8.8 ppg Vis 34 sec Incl ----° MU and SB DP in derrick. Test diverter system, rig alarms and PVT sensors—witnessed by AOGCC's Jeff Jones. Load pipe shed with DP and 13-3/8" csg. MU BHA #1, load additional BHA components into pipe shed. Hold pre-spud safety mtg. Clean out conductor from 43' to 117'. Spud well at 02:24, 8/22/12 and drill 16" hole 117' to 318'. CBU,POH to PU directional drilling tools. August 22,2012 900' MW 9.2 ppg Vis 200 sec Incl 1.20° POH to 49', MU 8" directional tools. Shallow-test tools and RIH. Drill 16"hole 318' to 707'. Lost 300 psi pump pressure and ROP became erratic. POH. Bit worn but no probs found. MU new bit, RIH and drill 707' to 900'. August 23, 2012 2,080' MW 9.6 ppg Vis 180 sec Incl 0.73° Drill 16"hole 900' to 2,080',pumping 20 bbl hi-vis sweeps as necessary. August 24,2012 2,462' MW 9.6 ppg Vis 85 sec Incl 0.22° Drill 16" hole from 2,080' to 2,462'. CBU, POH to HWDP at 700'. RIH to TD, CBU. Monitor well—stable. POH, LD directional tools. August 25,2012 2,462' MW 9.5 ppg Vis 65 sec Incl 0.22° Finish LD tools. Make dummy run w/csg hgr into WH. RU to run casing. Run 13-3/8", 68#, L-80, BTC casing to 2,447' and land out. C&C mud, RU to run inner cementing string. August 26, 2012 2,462' MW 9.5 ppg Vis 50 sec Incl 0.22° Ost RIH w/ cmtg stinger on DP. Sting into FC, slack off w/ 10K lbs wt. RU to cmt. Test lines to 3,000 psi then pump cmt as follows: 5 bbls H2O + 60 bbls 10.5 ppg weighted VA •S'Al' spacer w/red dye +361 bbls Type L lead cement+ 82 bbls 15.8 ppg Class G tail cement. Drop plug, pump away with 10 bbls H2O, switch to rig pumps and displace w/ 27 bbls mud. Bump plug and check floats— OK. 180 bbls excess lead cement received back at surface. Unsting f/FC, CBU, flush diverter and lines and POH. Commence ND diverter. August 27, 2012 2,462' MW 9.5 ppg Vis 50 sec Incl 0.22° Finish ND diverter system. MU csg head and seals. Test seals. NU adapter spool, single gate rams, mud cross, double gate rams, annular preventer. MU choke, kill and koomey lines. Function test BOPE, install riser and mouse hole. August 28, 2012 2,462' MW 9.2 ppg Vis 45 sec Incl 0.22° Test BOPE to 250/5,000 psi, annular to 250/2,500 psi, Test witnessed by AOGCC's Lou Grimaldi. Dummy run 9-5/8" casing hanger into wellhead. PU/MU 12-1/4" drilling BHA,RIH w/BHA on DP singles from pipe shed. August 29, 2012 3,496' MW 9.2 ppg Vis 41 sec Incl 0.29° RIH picking up singles from 741' to 2,348'. Displace spud mud from hole w/ LSND drilling mud. Test csg to 3,500 psi for 30 min. Drill shoe track, rathole and 20' of new hole to 2,482'. Perform LOT- yielded 13.1 ppg EMW. Drill 12-1/4" hole from 2,482' to 3,496'. August 30,2012 4,625' MW 9.3 ppg Vis 42 sec Incl 0.68° Make wiper trip to 2,441 -work through tight spots w/20K lbs overpull. RIH to btm- no tight spots. Drill 12-1/4" hole from 3,496' to 4,547'. CBU, monitor well - static. Make wiper trip to 3,450' - work through tight spots w/20 - 30K lbs overpull. RIH to btm-no tight spots. Drill from 4,547' to 4,625'. August 31,2012 5,625' MW 9.3 ppg Vis 42 sec Incl 1.58° Drill/slide 12-1/4" hole from 4,547' to 5,505'. Make wiper trip to 4,545'- several tight spots pulling out, hole slick going back in. Drill from 5,505' to 5,625'. September 1, 2012 6,750" MW 9.3 ppg Vis 42 sec Incl 0.79° Drill/slide from 5,625' to 6,560'. Make wiper trip to 5,495' - had to back-ream from 5,793' to 5,580' and pump out from 5,580' to 5,495', trip back in went smoothly. Drill from 6,560' to 6,750'. September 2, 2012 7,708' MW 9.4 ppg Vis 48 sec Incl 0.89° Drill from 6,750' to 7,612'. Make wiper trip to 6,460' - minor tight spots coming out, slick going back in. Drill/slide from 7,612' to 7,708'. September 3,2012 8,412' MW 9.5 ppg Vis 48 sec Incl 0.89° Drill/slide from 7,708' to 8,412'. September 4, 2012 8,750' MW 9.6 ppg Vis 49 sec Incl 9.18° Slide/drill from 8,412' to 8,750'. C&C hole to circulate out gas. Monitor well - static. Commence short trip to surface casing shoe. September 5,2012 8,750' MW 9.6 ppg Vis 47 sec Incl 8.67° POH from 5,347'. Had to back ream 3,400' to 3,113'. POH to casing shoe at 2,441'. C&C hole while performing rig maintenance. RIH from 2,441' to 8,377'. Wash and rotate to 8,750'. Pump sweep, C&C mud. September 6,2012 8,750' MW 9.7 ppg Vis 56 sec Incl 8.07° C&C hole. POH, LD BHA. Test blind rams to 250/5,000 psi. RU to run WL tools. RIH w/Triple Combo/GEM,tag up at 8,720'. Begin logging up at 15 fpm. September 7,2012 8,750' MW 9.7 ppg Vis 55 sec Incl 8.07° Log from 6,980' to surface with triple combo/GEM. PU dipole sonic logging tool and RIH. Tag fill at 8,710' and log to surface. RD WL equip, test BOPE. Test witness waived by AOGCC's Jeff Jones. MU 12-1/4"cleanout BHA. September 8, 2012 8,750" MW 9.7 ppg Vis 54 sec Incl 8.07° Finish MU cleanout BHA and RIH to 8,750' TD. C&C hole w/viscous sweeps. POH, LD BHA. September 9, 2012 8,750' MW 9.7 ppg Vis 60 sec Incl 8.07° Finish LD BHA. RU csg running equipment. Install 9-5/8" rams and test to 250/3,500 psi. RIH w/9-5/8",47#, L-80,BTC casing to 6,021'. September 10, 2012 8,750' MW 9.7 ppg Vis 60 sec Incl 8.07° Run 9-5/8" casing to 8,727' and land out in wellhead. MU cmt head and lines and circulate well. Test cementing lines and pump first stage cement as follows: 60 bbls 11.0 ppg spacer+ 396 bbls 12.5 ppg lead cement + 78 bbls 15.8 ppg tail cement. Displace w/ mud using rig pumps. Did not bump plug. Lost 278 bbls mud while displacing. Check floats—OK. Pump second stage as follows: Drop stage tool opening plug and allow to e.2_401, '"` fall onto seat. Pressure up to open P-ES cementer. Pump 30 bbls 11.0 ppg spacer+ 160 bbls 15.8 ppg cmt. At 150 bbls pumped, lost returns. Drop closing plug and displace w/ rig pumps. Pressure up to close stage tool. RD cementing equipment. September 11, 2012 8,750' MW 9.7 ppg Vis 59 sec Incl 8.07° RD cmtg equip. Freeze protect 9-5/8" x 13-3/8" annulus w/ 3-1/2 bbls diesel. Install packoff and test void to 5,000 psi. RD choke and kill lines, break down and remove BOP components from cellar. Install new tubing spool on wellhead. NU adapter flange and re-assemble BOP stack and choke&kill lines. September 12, 2012 8,750' MW 9.7 ppg Vis 58 sec Incl 8.07° Torque BOP flanges, change out top and bottom rams to 2-7/8" x 5-1/2" variables. Install MPD rotating head. Plumb in koomey unit and function test it and all rams. Continue RU MPD equipment. Body test BOPs to 250/3,500 psi. Load shed w/ DP and MU/SB 2,000' of stands f/shed. RU to test BOPs. September 13,2012 8,750' MW 9.8 ppg Vis 58 sec Incl 8.07° Test upper and lower VBRs to 250/3,500 psi. Continue RU of MPD system. PU/MU BHA and RIH. Tag up on ES Cementer plugs at 2,377'. Mill up plugs. Pump up to 2,950 psi to set 9-5/8" TAM packer. Bleed off. Pressure up to 2,250 psi to close valve on ECP. Bleed off then pressure back up to 2,250 psi to confirm valve closure. Pressure test csg to 3,000 psi for 30 minutes—good test. POH, LD BHA. September 14, 2012 8,770' MW 9.8 ppg Vis 59 sec Incl 8.07° Test BOPE, sensors and alarms. Test witness waived by AOGCC's Chuck Scheve. MU BHA and RIH to firm cmt at 8,590'. Drill out cmt, shoe track and rat hole to 8,750'. Drill 20' of new hole to 8,770'. Prep to swap over to coring fluid system. September 15, 2012 9,012' MW 10.6 ppg Vis 48 sec Incl 8.07° Change out 9.8 ppg intermediate hole drilling mud to 10.4 ppg coring mud. Conduct LOT; leaked off at 14.8 ppg EMW. Rotary drill to core point at 9,012'. Weight up mud system to 10.6 ppg(to reduce background gas)and POH. LD BHA, MU coring assy. September 16,2012 9,025' MW 10.6 ppg Vis 53 sec Incl 8.07° MU coring assy and RIH. Wash down last stand and tag at 9,012', drop ball. Core from 9,012' to 9,025' at 2 fph. September 17, 2012 9,028' MW 10.6 ppg Vis 55 sec Incl 8.07° Continue coring from 9,025' to 9,028'. Stop coring, break off core w/ 32K lbs overpulkl and POH. Recovered 14.4' of core out of 15.3' cut. Modify core catching assy and RIH w/core assy to 6,930'. September 18, 2012 9,080' MW 10.7 ppg Vis 55 sec Incl 8.07° RIH from 6,930' to 8,672'. Wash to 9,028, drop ball. Core from 9,028' to 9,080'. September 19, 2012 9,089' MW 10.8 ppg Vis 58 sec Incl 8.07° Core from 9,080' to 9,089'. Stop rotation and PU 30K lbs overpull to break off core. POH. Recovered 61' of core out of 61' cut. MU directional drilling BHA and RIH. September 20,2012 9,610' MW 11.1 ppg Vis 58 sec Incl 6.48° RIH to 9,030', MAD pass w/ LWD tools 9,030' to 9,089'. Drill 8-1/2" hole 9,089' to 9,215'. Raise MW to 11.1 ppg(BGG at 2,200 units). Continue drilling/sliding to 9,610'. September 21, 2012 10,611' MW 11.4 ppg Vis 58 sec Incl 3.54° Drill from 9,610' to 10,611'. CBU, monitor well—static. POH. September 22,2012 10,611' MW 11.4 ppg Vis 58 sec Incl 3.21° Download and SB BHA. Test BOPE to 250/5,000 psi, test witness waived by AOGCC's Lou Grimaldi. MU Core Assembly#3 and RIH. September 23, 2012 10,644' MW 11.4 ppg Vis 50 sec Incl 3.21° RIH to 9,242', packed off. Backream up then wash and ream to btm at 10,611'. Cut Core#3 from 10,611' to 10,644'. September 24,2012 10,660' MW 11.6 ppg Vis 63 sec Incl 3.21° Core from 10,644' to 10,659'. Raise MW to 11.6 ppg. Attempt to break core; catcher slipping at 55K lbs overpull. Core one additional foot to 10,660'. Break off core w/65K lbs overpull. POH. Handle core bbls at surface. September 25, 2012 10,749' MW 11.6 ppg Vis 60 sec Incl 3.21° Recover 48.8' of core out of 49' cored. MU new core bit and bbls and RIH. Service rig and PU space-out pup at csg shoe. RIH, washing down from 9,550' to 10,623'. Pump sweep, observe 3,270 units trip gas. Drop ball, circ to seat and commence coring. Cut Core #4 from 10,660' to 10,749'. Stop coring, break off w/ 28K lbs overpull. Monitor well—static. POH pumping. September 26, 2012 10,749' MW 11.8 ppg Vis 66 sec Incl 3.21° Pump out of hole to casing shoe. POH on elevators to surface. Handle coring tools. Recovered 89' out of 89' cored. MU new inner bbls and re-run core bit and RIH to csg shoe. Service rig and cont RIH to 9,300'. September 27,2012 10,753' MW 12.0 ppg Vis 55 sec Incl 3.21° RIH to 10,210'. Ream to 10,586', packed off and stuck. Work free and cont reaming to btm at 10,749'. Cut Core #5 from 10,749' to 10, 753'. ROP 1.5 fph, core barrel/bit appears to be jammed. PU, increase system MW to 12.0 ppg and POH, pumping and backreaming as required to shoe. POH on elevators in cased hole to 300'. September 28, 2012 10,753' MW 12.0 ppg Vis 62 sec Incl 3.21° Handle core bbls. 2 feet of core recovered from 4 feet cored. Change out bit, MU coring assy and RIH. Tag up at 9,797'. Wash and ream to 10,734'. September 29, 2012 10,843' MW 12.2 ppg Vis 58 sec Incl 3.21° Wash and ream to 10,753'. Drop ball and core from 10,753' to 10,843' (90'). Break off core w/25K lbs overpull and POH. September 30, 2012 10,843' MW 12.2 ppg Vis 60 sec Incl 3.21° Cont POH. LD and handle core; recovered 92.37'. Test BOPE (weekly test), witness waived by AOGCC's John Crisp. Replace and re-test failed IBOP. LD outer core bbls from derrick. October 1,2012 10,834' MW 12.2 ppg Vis 61 sec Incl 3.21° Finish LD 6-3/4" outer core bbl f/ derrick. MU 4-3/4" core barrels w/ new bit. RIH. Stop at shoe to slip/cut drlg line and MU space-out pups. RIH,tag up at 9,147'. Wash& ream from 9,147' to 10,486'. October 2,2012 10,933' MW 12.2 ppg Vis 62 sec Incl 3.21° Wash & ream to btm at 10,843'. Drop ball and circulate down. Cut Core #7 from 10,843' to 10,933' (90'). Break off core w/ 10K lbs overpull and POH. October 3,2012 10,933' MW 12.2 ppg Vis 62 sec Incl 3.21° Finish POH w/ Core #7. LD outer and inner core bbls. 90.5' of core recovered (100%). MU drilling BHA w/ LWD tools and RIH to 9,490' (tagged up). MU top drive and wash/ream to 9,580'. October 4, 2012 11,013' MW 12.2 ppg Vis 59 sec Inel 3.03° Wash & ream from 9,580' to bottom at 10,933'. Drill 8-1/2" hole from 10,933' to 11,013'. October 5, 2012 11,094' MW 12.2 ppg Vis 57 sec Incl 2.44° Drill 8-1/2" hole from 11,013' to 11,094' TD. MAD pass w/ LWD tools from TD up to 8,940'. Had to work through several tight spots. October 6, 2012 11,094' MW 12.2 ppg Vis 58 sec Incl 2.64° Finish MAD pass to csg shoe at 8,727'. POH, download and LD BHA. RU WL,RIH w/ logging pass #1. Tag up at 8,740'. POH, change to different hole-finder on bottom of logging tools. RIH, tag up at 8,740'. Would not pass. POH and RD WL. Commence LD HWDP. October 7,2012 11,094' MW 12.2 ppg Vis 68 sec Incl 2.64° LD HWDP and jars. Test lwr VBR's on 2-7/8" test joint — OK. MU 2-7/8" mule shoe and 30 jts 2-7/8" tbg on DP and RIH. Precautionary wash & ream from csg shoe to 8,764'. RIH on elevators,tag up at 9,200'. Wash&ream from 9,200' to 9,434'. October 8, 2012 11,094' MW 12.2 ppg Vis 59 sec Incl 2.64° Wash & ream to 11,094' TD. C&C hole while RU to cement. Pump Plug #1 as: 5 bbls G water + 33 bbls 13.0 ppg spacer + 62 bbls 15.8 ppg Class G cmt + 12 bbls 13.0 ppg /kw{ spacer. Displace w/ 165 bbls mud. End displacement, attempt to POH. Pipe stuck. 'v Pump dn DP while working pipe. Lost approx 235 bbls mud to fm while working pipe. Pipe came free, POH to 10,350'. October 9,2012 11,094' MW 12.2 ppg Vis 59 sec Incl 2.64° POH to 9,727'. Drop DP wiper ball and circ down. RIH,tag top of plug at 10,170', saw Plug #1 lead spacer come to surface. Pump Plug #2 as: 5 bbls water+ 33 bbls 13.0 ppg spacer + 62 bbls 15.8 ppg Class G cmt + 12 bbls 13.0 ppg spacer. Displace w/ mud. POH to 9,088', drop DP wiper ball and circ down to 9,362'. Pump Plug #3 as: 5 bbls water + 34 bbls 13.0 ppg spacer + 59 bbls 17.0 ppg Class G cmt + 11 bbls 13.0 ppg spacer. Displace w/ mud. Drop DP wiper ball and POH to 8,322'. Wash dn to 8,575' and circ hole clean. POH,handle tbg cmtg stinger. October 10,2012 11,094' MW 12.2 ppg Vis 68 sec Incl 2.64° LD bent tbg jts. Test BOPE(weekly test). Test witness waived by AOGCC's John Crisp. RIH w/2-7/8"cmtg stinger on 5"DP to 8,480'. October 11, 2012 11,094' MW 12.2 ppg Vis 75 sec Incl 2.64° RIH, tag firm cement at 8,822'. Order out another batch of cmt. POH LD 3,000' of DP, RIH w/ 3,000' DP out of derrick. Pump Plug #4 as: 5 bbls water + 33 bbls 13.0 ppg spacer + 32 bbls 17.0 ppg Class G cmt + 12 bbls 13.0 ppg spacer. Displace w/ mud. POH to 8,134', drop DP wiper ball and wash dn to 8,475'. C&C mud and perform rig maintenance while WOC. Wash down,tag firm cmt at 8,582' w/20K lbs. Circ suface to surface to even out mud. October 12,2012 11,094' MW 12.2 ppg Vis 75 sec Incl 2.64° C&C mud. Pressure test casing to 3,000 psi. Pump dry job and POH LD DP w/o filling hole. SB tbg stinger. Fill csg to surface w/2,450 gals freeze protect diesel. RIH w/ 2- 7/8"tbg to 827'. October 13, 2012 11,094' MW 12.2 ppg Vis 58 sec Incl 2.64° Clean pits. MU 2-7/8"tbg hgr. Top off csg w/diesel, land hgr. RD tbg handling equip, flush lines,prep rig for SD. ND BOPE/MPD. October 14,2012 11,094' MW 12.2 ppg Vis 68 sec Incl 2.64° ND BOPE/MPD while loading out third party equip. Install TWC in tbg hgr. Continue ND BOPE while loading out equip and preparing rig for SD. October 15, 2012 11,094' MW 12.2 ppg Vis 59 sec Incl 2.64° Cont prepping rig for SD. Prep hgr void, install blank ported adapter flange. Test void to 10K psi. Remove TWC, install BPV. Bottom-test BPV by pressuring inner annulus to 500 psi. Cont prepping rig for SD. Release rig at 0600 hrs, 10-16-12. FINAL REPORT. HALLIBURTON INSITE DIRECTIONAL SURVEY REPORT Great Bear Petroleum,LLC Merak 1 Exploration North Slope Borough Alaska USA AK-XX-0009498071 Surveys are SAG corrected. Final survey is projected to TD. Measured Vertical Vertical Depth Inclination Direction Depth Latitude Departure Section Dogleg (feet) (degrees) (degrees) (feet) (feet) (feet) (feet) (deg/100ft) 0.00 0.00 0.00 0.00 0.00 N 0.00 E 0.00 TIE-IN 21.72 0.00 0.00 21.72 0.00 N 0.00E 0.00 0.00 205.22 0.40 109.63 205.22 0.22 S 0.60 E -0.58 0.22 293.21 0.66 120.50 293.20 0.58 S 1.33 E -1.35 0.32 387.92 1.20 119.10 387.90 1.33 S 2.67 E -2.83 0.57 480.14 1.33 123.91 480.10 2.40 S 4.40 E -4.81 0.18 572.31 1.27 123.87 572.25 3.57 S 6.13 E -6.86 0.07 659.01 1.69 127.20 658.92 4.88 S 7.95 E -9.07 0.49 755.48 0.75 115.11 755.36 6.00 S 9.65 E -11.07 1.00 852.80 0.80 111.29 852.67 6.52 S 10.86 E -1229 0.07 948.96 1.24 117.44 948.82 7.24 S 12.41 E -13.90 0.47 1042.78 0.15 104.50 1042.63 7.74 S 13.43 E -14.97 1.17 1140.43 0.57 311.45 1140.28 7.45 S 13.19 E -14.60 0.72 1237.27 0.76 320.43 1237.11 6.64 S 12.42 E -13.48 0.22 1331.49 0.89 324.83 1331.32 5.56 S 11.60 E -12.14 0.15 1424.86 0.73 291.84 1424.68 4.75 S 10.63 E -10.87 0.52 1521.09 0.55 296.22 1520.91 4.31 S 9.65 E -9.87 0.19 1617.23 0.55 303.23 1617.04 3.86 S 8.85 E -8.98 0.07 171285 0.43 298.52 1712.66 3.43 S 8.15 E -8.19 0.13 1808.37 0.46 297.19 1808.18 3.09 S 7.49 E -7.48 0.03 1902.82 0.40 283.50 1902.63 2.84 S 6.84 E -6.84 0.13 2000.03 0.50 291.93 1999.83 2.60 S 6.11 E -6.16 0.12 2096.67 0.33 288.27 2096.47 2.35 S 5.46 E -5.52 0.18 2189.37 0.42 293.41 2189.17 2.14 S 4.89 E -4.97 0.10 2286.29 0.22 285.11 2286.09 1.95 S 4.39 E -4.48 0.21 2382.70 0.38 256.72 2382.49 1.97 S 3.90 E -4.15 0.22 2416.13 0.46 300.59 2415.92 1.93 S 3.67 E -3.96 0.96 2476.15 0.31 269.70 2475.94 1.81 S 3.30 E -3.61 0.42 2572.53 0.27 237.07 2572.32 1.93 S 2.85 E -3.38 0.17 2668.57 0.27 225.36 2668.36 2.21 S 2.50 E -3.33 0.06 2762.54 0.36 223.57 276233 2.58 S 2.14 E -3.34 0.10 2859.05 0.29 243.52 2858.84 2.91 S 1.71 E -3.27 0.14 2954.96 0.37 224.35 2954.75 3.24 S 1.28 E -3.20 0.14 3051.08 0.35 242.08 3050.86 3.60 S 0.80 E -3.11 0.12 3147.07 0.31 234.82 3146.85 3.89 S 0.33 E -2.98 0.06 3241.90 0.37 215.93 3241.68 4.28 S 0.06 W -2.99 0.13 3338.63 0.44 230.17 3338.41 4.77 S 0.53 W -3.00 0.13 3433.80 0.46 207.29 3433.58 5.35 S 0.98 W -3.09 0.19 3527.21 0.46 225.29 3526.98 5.94 S 1.42 W -3.20 0.15 3628.46 0.49 218.68 3628.23 6.57 S 1.98 W -3.25 0.06 3719.73 0.51 231.61 3719.50 7.13 S 2.54 W -3.24 0.13 3816.40 0.59 225.83 3816.16 7.74 S 3.24 W -3.18 0.10 3910.83 0.68 219.79 3910.59 8.51 S 3.94 W -3.23 0.12 4007.62 0.70 220.09 4007.37 9.40 S 4.69 W -3.33 0.02 410229 0.71 224.57 410203 10.26 S 5.48 W -3.39 0.06 Page 1 of 3 HALLIBURTON Merak 1 Measured Vertical Vertical Depth Inclination Direction Depth Latitude Departure Section Dogleg (feet) (degrees) (degrees) (feet) (feet) (feet) (feet) (deg/100ft) 4197.60 0.71 220.92 4197.33 11.13 S 6.28 W -3.43 0.05 4294.41 0.79 216.96 4294.14 12.12 S 7.07 W -3.57 0.10 4389.95 0.51 201.65 4389.67 13.04 S 7.62 W -3.83 0.34 4485.57 0.55 196.80 4485.29 13.87 S 7.91 W -4.21 0.06 4581.52 0.57 218.74 4581.23 14.69 S 8.35 W -4.48 0.22 4676.26 1.06 12.43 4675.97 14.20 S 8.45 W -4.06 1.68 4771.61 1.57 17.43 4771.29 12.09 S 7.87 W -2.98 0.55 4868.13 1.58 17.62 4867.77 9.56 S 7.07 W -1.76 0.01 4967.66 1.58 17.07 4967.27 6.94 S 6.25 W -0.49 0.02 5059.71 1.60 16.57 5059.28 4.50 S 5.51 W 0.72 0.03 5155.87 1.09 5.16 5155.41 2.30 S 5.05 W 1.95 0.60 5250.98 1.05 7.41 5250.51 0.53 S 4.86 W 3.06 0.06 5347.19 0.81 24.77 5346.71 0.96 N 4.46 W 3.83 0.38 5443.81 0.84 93.27 5443.32 1.54 N 3.46 W 3.54 0.96 5539.58 0.84 83.88 5539.08 1.57 N 2.06 W 2.57 0.14 5637.34 0.82 95.80 5636.83 1.58 N 0.66 W 1.58 0.18 5731.28 0.82 90.17 5730.76 1.51 N 0.68 E 0.58 0.09 5827.48 0.83 100.25 5826.95 1.38 N 2.06 E -0.48 0.15 5923.32 0.82 83.65 5922.78 1.33 N 3.42 E -1.48 0.25 6018.45 0.79 89.08 6017.90 1.42 N 4.76 E -2.36 0.09 6116.64 0.60 251.70 6116.09 1.27 N 4.94 E -2.60 1.40 6209.50 0.82 255.20 6208.94 0.95 N 3.84 E -2.05 0.24 6305.63 0.88 247.54 6305.06 0.49 N 2.49 E -1.42 0.13 6401.70 0.79 246.95 6401.12 0.05 S 1.20E -0.89 0.09 6497.54 0.76 241.08 6496.95 0.62 S 0.04 E -0.46 0.09 6593.78 0.77 241.61 6593.18 1.23 S 1.09 W -0.10 0.01 6688.62 0.83 247.81 6688.01 1.80 S 2.29 W 0.35 0.11 6783.74 0.82 247.83 6783.12 2.31 S 3.56 W 0.88 0.01 6879.13 0.84 251.69 6878.50 2.79 S 4.85 W 1.46 0.06 6974.46 0.78 252.32 6973.82 3.21 S 6.13 W 2.07 0.06 7069.90 0.89 249.07 7069.25 3.67 S 7.44 W 2.67 0.13 7166.22 0.90 257.03 7165.56 4.11 S 8.88 W 3.38 0.13 7260.54 0.76 262.84 7259.87 4.35 S 10.22 W 4.15 0.17 7357.34 0.85 273.49 7356.66 4.39 S 11.58 W 5.08 0.18 7453.71 1.03 285.29 7453.02 4.11 S 13.12 W 6.37 0.27 7548.95 1.13 290.38 7548.24 3.56 S 14.83 W 7.97 0.15 7646.60 0.86 299.00 7645.88 2.87 S 16.37 W 9.55 0.32 7740.99 0.22 290.00 7740.26 2.47 S 17.16 W 10.39 0.68 7836.58 0.43 303.43 7835.85 2.21 S 17.64 W 10.91 0.23 7932.33 0.60 311.72 7931.60 1.67 S 18.31 W 11.76 0.19 8027.48 0.89 329.92 8026.74 0.70 S 19.05 W 12.98 0.39 8123.65 1.71 329.47 8122.88 1.18 N 20.16 W 15.09 0.85 8219.23 3.72 335.07 8218.35 5.22 N 22.19 W 19.38 2.12 8315.30 6.59 330.64 8314.02 12.85 N 26.20 W 27.62 3.01 8409.62 7.97 329.63 8407.58 23.21 N 32.16 W 39.16 1.47 8505.46 9.18 330.28 8502.35 35.58 N 39.31 W 52.96 1.27 8601.96 8.67 329.33 8597.68 48.53 N 46.84 W 67.43 0.55 8687.33 8.07 330.88 8682.14 59.29 N 53.04 W 79.43 0.75 8781.38 7.74 332.25 8775.29 70.67 N 59.20 W 91.83 0.40 8877.25 7.22 333.97 8870.35 81.79 N 64.85 W 103.69 0.59 8973.57 6.54 337.36 8965.97 92.29 N 69.62 W 114.49 0.82 9070.51 6.48 336.05 9062.29 102.39 N 73.96 W 124.70 0.17 9162.59 6.36 335.60 9153.79 111.78 N 78.18 W 134.32 0.14 9256.81 5.56 335.58 9247.50 120.69 N 82.22 W 143.48 0.85 9355.27 5.22 334.91 9345.53 129.09 N 86.09 W 152.16 0.35 Date PrintedA5 October 2012 Page 2 of 3 HALLIBURTON Merak 1 Measured Vertical Vertical Depth Inclination Direction Depth Latitude Departure Section Dogleg (feet) (degrees) (degrees) (feet) (feet) (feet) (feet) (deg/100ft) 9451.76 4.21 334.58 9441.69 136.26 N 89.48 W 159.62 1.05 9546.61 3.98 333.26 9536.30 142.35 N 92.45 W 166.03 0.26 9640.62 3.98 333.34 9630.08 148.18 N 95.38 W 172.22 0.01 9736.66 3.86 331.15 9725.90 153.99 N 98.44 W 178.49 0.20 9834.22 3.74 329.64 9823.24 159.61 N 101.63 W 184.73 0.16 9927.04 3.71 328.57 9915.87 164.78 N 104.73 W 190.57 0.08 10025.79 3.54 330.01 10014.42 170.15 N 107.92 W 196.62 0.20 10117.76 3.41 329.16 10106.22 174.96 N 110.74 W 202.02 0.15 10213.98 3.39 332.08 10202.27 179.93 N 113.54 W 207.51 0.18 10312.43 3.30 333.15 10300.55 185.03 N 116.18 W 212.99 0.11 10408.97 3.21 332.43 10396.94 189.90 N 118.69 W 218.21 0.10 10501.20 3.21 331.28 10489.02 194.46 N 121.12 W 223.15 0.07 10560.93 3.21 331.64 10548.66 197.40 N 122.72 W 226.36 0.03 10577.79 3.32 332.40 10565.49 198.24 N 123.17 W 227.27 0.70 10673.10 3.03 336.24 10660.65 203.00 N 125.46 W 232.26 0.38 10767.67 3.06 336.16 10755.09 207.59 N 127.49 W 236.94 0.03 10865.00 3.35 335.85 10852.27 212.56 N 129.70 W 242.02 0.30 10959.55 2.44 356.84 10946.70 217.09 N 130.95 W 246.10 1.46 10993.28 2.64 0.62 10980.40 218.59 N 130.98 W 247.18 0.77 11094.00 2.64 0.62 11081.01 223.23 N 130.93 W 250.42 0.00 CALCULATION BASED ON MINIMUM CURVATURE METHOD SURVEY COORDINATES RELATIVE TO WELL SYSTEM REFERENCE POINT TVD VALUES GIVEN RELATIVE TO DRILLING MEASUREMENT POINT VERTICAL SECTION RELATIVE TO WELL HEAD VERTICAL SECTION IS COMPUTED ALONG A DIRECTION OF 315.00 DEGREES(TRUE) A TOTAL CORRECTION OF 20.75 DEG FROM MAGNETIC NORTH TO TRUE NORTH HAS BEEN APPLIED HORIZONTAL DISPLACEMENT IS RELATIVE TO THE WELL HEAD. HORIZONTAL DISPLACEMENT(CLOSURE)AT 11094.00 FEET IS 258.79 FEET ALONG 329.61 DEGREES(TRUE) Surveys are SAG corrected. Final survey is projected to TD. Date Printed:05 October 2012 Page 3 of 3 REOCT 192012CEIVE " ` AOGCC Great Bear Petroleum Operating LLC A New Direction for the Last Frontier 601 W. 5`'' Ave,, Suite 505, Anchorage, AK 99501 Phone: (907) 868-8070, Fax: (907) 868-3887 October 17, 2012 Ms. Cathy Foerster, Chair Alaska Oil and Gas Conservation Commission 333 West 7th Ave., Suite 100 Anchorage, Alaska 99501 RE: Application for Sundry Approval Well Suspension: Merak #1 (PTD No. 212-101) Dear Ms. Foerster, Great Bear Petroleum Operating LLC hereby applies for Sundry Approval to suspend the Merak #1, a new oil exploration well located onshore near the Dalton Highway south of Deadhorse, Alaska. A Permit to Drill for the Merak #1 was issued by the AOGCC on August 7, 2012 and drilling commenced there on August 21. TD was reached on October 5. Great Bear proposes to suspend the well pending a decision on the form of further diagnostic operations. To accomplish the suspension, Great Bear proposes to: • Plug back the entire open hole with cement from TD to at least 100' into the shoe of the 9-5/8" intermediate casing • Tag the cement top to confirm its depth V • Pressure test the casing to 3,000 psi V(-/-esl— cwt Olin • Set 2-7/8" tubing from the surface to the base of the permafrost (base of permafrost is at 761' RKB in this well) Bringing the Unconventional Resource Play to Alaska 3 October 17, 2012 Page 2 of 2 • Freeze protect the tubing and 9-5/8" casing with diesel across the permafrost (the remainder of the well will be left with 12.2 ppg drilling mud with corrosion and bacteria inhibitors) • Set and bottom-test (to 500 psi) a back-pressure valve in the tubing hanger • Set a dry hole tree consisting of two 7", 5K psi valves and a tree cap. Attached you will find a Sundry Application Form 10-403 and a current wellbore • diagram. If you have any questions or require additional information, please contact me at (907) 868-8070 or (281) 828-0389. Sincerely, Great Bear Petroleum Operating LLC r Clark Clement, Chief Operating Officer Attachments Bringing the Unc-on ventronal Resource Play to Alaska gw,I771, , THE STATE Alaska Oil and Gas � = M °fALAS� Conservation Commission �*4 GOVERNOR SEAN PARNELL 333 West Seventh Avenue OA, Anchorage, Alaska 99501-3572 ALAS Main: 907.279.1433 Fax: 907.276.7542 Clark Clement Chief Operating Officer Great Bear Petroleum Operating, LLC 601 West 5th Avenue, Suite 505 Anchorage, AK 99501 Re: Exploration Field, Exploration Pool, Merak #1 Sundry Number: 312-406 Dear Mr. Clement: Enclosed is the approved Application for Sundry Approval relating to the above referenced well. Please note the conditions of approval set out in the enclosed form. As provided in AS 31.05.080, within 20 days after written notice of this decision, or such further time as the Commission grants for good cause shown, a person affected by it may file with the Commission an application for reconsideration. A request for reconsideration is considered timely if it is received by 4:30 PM on the 23rd day following the date of this letter, or the next working day if the 23rd day falls on a holiday or weekend. Sincerely, / /4607er\___ Cathy '. Foerster Chair DATED this Z day of October, 2012. Encl. RECEWED I°�� DCT 1 9 2012 STATE OF ALASKA /3rS /O(Z,31'( . ALASKA OIL AND GAS CONSERVATION COMMISSION A(\ ( APPLICATION FOR SUNDRY APPROVALS ) 20 AAC 25.280 1.Type of Request Abandon❑ Plug for Redd!❑ Perforate New Pool❑ Repair Well❑ Change Approved Program❑ Suspend Q ' Plug Perforations❑ Perforate❑ Pull Tubing❑ Time Extension❑ Operations Shutdown❑ Re-enter Susp.Well❑ Stimulate❑ Alter Casing❑ Other ❑ 2.Operator Name. 4.Current Well Class 5 Permit to Drill Number Great Bear Petroleum Operating LLC Exploratory ❑✓ Development ❑ 212-101 • 3.AddressStratigraphic ❑ Service ❑ 6.API Number 601 West 5th Avenue,Suite 505,Anchorage,Alaska 99501 50-223-20027-00-00 • 7.If perforating 8 Well Name and Number What Regulation or Conservation Order governs well spacing in this pool' Merak#1 ' Will planned perforations require a spacing exception? Yes ❑ No Q 9.Property Designation(Lease Number) ' 10 Field/Pool(s): ADL 391706 • Exploration • 11. PRESENT WELL CONDITION SUMMARY Total Depth MD(ftp Total Depth TVD(ft): Effective Depth MD(ft): Effective Depth ND(ft): Plugs(measured): Junk(measured) 11,094' 11,088' 8,582' 8,577' 8,582' None Casing Length Size MD ND Burst Collapse Structural - Conductor 94' 20" 117' 117' N/A N/A Surface 2,418' 13-3/8" 2,441' 2,441' 5,750 psi 3,090 psi Intermediate 8,713' 9-5/8" 8,736' 8,731' 6,870 psi 4,750 psi Production Liner Perforation Depth MD(ft) Perforation Depth ND(ft) Tubing Size Tubing Grade Tubing MD(ft) N/A N/A N/A N/A N/A Packers and SSSV Type Packers and SSSV MD(ft)and ND(ft) N/A N/A 12 Attachments Description Summary of Proposal Q '13.Well Class after proposed work: Detailed Operations Program ❑ BOP Sketch ❑ Exploratory ❑✓ • Stratigraphic❑ Development❑ Service ❑ 14 Estimated Date for '15.Well Status after proposed work. Operations' 10/13/2012 CommencingOil O pe ❑ Gas ❑ WDSPL ❑ Suspended 0 16 Verbal Approval: Date 10/12/2012 WINJ ❑ GINJ ❑ WAG ❑ Abandoned ❑ Commission Representative. Guy Schwartz GSTOR ❑ SPLUG ❑ 17.I hereby certify that the foregoing is true and correct to the best of my knowledge. Contact Bill Penrose 907-264-6114 Email bilk solstenxp.com Printed NameClark Clement Title 4,- +6NCI. Chief Operating Officer Signature Phone Date 0 -,..4 907-868-8070 COMMISSION USE ONLY Conditions of approval Notify Commission so that a representative may witness Sundry Number. >12 - (-/000 Plug Integrity [r BOP Test ❑ Mechanical Integnty Test ❑ Location Clearance ❑ Other Spacing Exception Required? Yes ❑ No 2( Subsequent Form Required. /0- y 0-1- APPROVED BY Approved by COMMISSIONER THE COMMISSION Date: ! Z3— /Z_ Submit Form and W 0 R1t1( eof o1L ov rc ti i approval.. va o months from the date of aAttachments in Duplicate�� d�C � , ,0.2,.,E ,oma I\I X Merak # 1 P H Proposed Wellbore Diagram ox: --- r 20" Conductor @ 93' Port Collar @ 500' --►.. :�. �� .: 'el .,•$ 80....5 e Perot I P t--�i•+ri : v 1 ti I.: r b Ci AlY t@ 3'C •t`•`•• "•'' Type P ES Stage Tool cc,13-3/8" Casing ; w/Packer @ — 2,400' L-80, 68 lbs/ft, BTC --► .,, ;., TD @ 2,441' .:% w.t: /r,Ju d :; ti4, ray: ti is 4:: .K syp, :iii, 1 '= - %®C e. t 'off ` 9-5/8' Casing ieif \ ''..`' L-80, 47 lbs/ft, BTC — 8,736' MD/8,731' TVD 1ri --+e-- 8-1/2" Hole .. ®,ret 4'; Itec/ Merak # 1 ID . .� , , . .t .• . //0 9y rL' • (150' Below Base Shublik) DRAWN BY: A. MICI REV: 04 SEP 2012 Page 1 of 1 Schwartz, Guy L (DOA) From: Bill Penrose [bill@solstenxp.com] Sent: Wednesday, October 17, 2012 1:43 PM To: Schwartz, Guy L (DOA) Subject: RE: Merak#1 P&A sundry (PTD 212-101) Guy, I'm out of the State at present but will get the Sundry to Great Bear for approval then get it delivered to you (in duplicate, of course) ASAP. The paperwork is done, I just have to get it out the door. Regards, Bill From: Schwartz, Guy L(DOA) [mailto:guy.schwartz@alaska.gov] Sent: Wednesday, October 17, 2012 8:45 AM To: Bill Penrose Subject: Merak #1 P &A sundry (PTD 212-101) Bill, Just a reminder that when verbal approval is given for a sundry the paper copy must be submitted within 3 days for final approval. ( see 20 AAC 25.015 (b)(2)) I have an email dated Oct 12th granting verbal approval. Guy Schwartz Senior Petroleum Engineer AOGCC 793-1226 (office) 444-3433 (cell) 1/15/2013 9 N)-;-) Great Bear Petroleum O ratin LLC 601 W. 5t Ave., Suite 505, Anchorage, AK 99501 Phone: (907) 868-8070, Fax: (907) 868-3887 October 16,2012 Ms. Cathy Foerster, Chair Alaska Oil and Gas Conservation Commission 333 West 7th Ave., Suite 100 Anchorage, Alaska 99501 RE: Weekly Report of Operations Great Bear Petroleum: Merak#1 (PTD #212-101) Dear Ms. Foerster, This is a report of Great Bear Petroleum's well operations on the Merak#1 for the period October 12 through October 15, 2012, inclusive. October 12, 2012 11,094' MW 12.2 ppg Vis 75 sec Incl 2.64° C&C mud. Pressure test casing to 3,000 psi. Pump dry job and POH LD DP w/o filling hole. SB tbg stinger. Fill csg to surface w/ 2,450 gals freeze protect diesel. RIH w/ 2- 7/8"tbg to 827'. October 13, 2012 11,094' MW 12.2 ppg Vis 58 sec Incl 2.64° Clean pits. MU 2-7/8" tbg hgr. Top off csg w/diesel, land hgr. RD tbg handling equip, flush lines, prep rig for SD. ND BOPE/MPD. October 14, 2012 11,094' MW 12.2 ppg Vis 68 sec Incl 2.64° ND BOPE/MPD while loading out third party equip. Install TWC in tbg hgr. Continue ND BOPE while loading out equip and preparing rig for SD. October 15, 2012 11,094' MW 12.2 ppg Vis 59 sec Incl 2.64° Cont prepping rig for SD. Prep hgr void, install blank ported adapter flange. Test void to 10K psi. Remove TWC, install BPV. Bottom-test BPV by pressuring inner annulus to 500 psi. Cont prepping rig for SD. Release rig at 0600 hrs, 10-16-12. FINAL REPORT. Bringing the Unconventional Resource Play to Alaska HALLIBURTON RECEIVED Sperry Drilling OCT 15 2012 To: Alaska Oil and Gas Conservation Commission AOGCC 333 West 7th Ave. Suite 100 Anchorage, AK 99501 Attn: Howard Okland (907) 793-1225 From: Sperry Drilling - Alaska Attn: Robert Haverfield 6900 Arctic Blvd Anchorage, AK 99518 907-273-3559 Office 907-273-3535 Fax Robert.Haverfield@Halliburton.com Re: Great Bear Petroleum LLC Well — Merak 1 North Slope, Alaska Shipment Includes: 1 Set — 11 boxes of dry samples 1 Set — 18 boxes of wet samples Received By: 4,1 u ...„L c L Print Name 1Las1L,_i _C3 ALL Sign Name Date Please sign acknowledgement of receipt - email, fax, or mail back. Thank you. la.- lob SAMPLE MANIFEST State Sample Boxes A Box Depth Envelopes . 1 900-1710 28 4' 2 1740-2460 25 hi , . 3 2490-3360 30 4 3390-4530 39 4, '" f 5 4560-5730 40 6 5760-6630 30 Great Bear Petroleum LIC 7 6660-7710 36 8 7740-8750 35 9 8760-9930 53 Sample Shipment to Anchorage 10 9960-10745 40 11 10750-11094 28 From: Merak 1, Deadhorse, AK 384 To: AOGCC Wet Sample Boxes 333 West 7th Avenue, Suite 100 Box Depth Bags Anchorage, Alaska 99501 1 900-1470 19 Attn: Howard Oakland 2 1500-2130 21 3 2160-2460 10 4 2490-3000 17 5 3030-3420 13 6 3450-4170 24 7 4200-5010 27 8 5040-5700 22 9 5730-6540 27 10 6570-7290 24 11 7320-8250 31 12 8280-8760 16 13 8790-9080 15 14 9120-9690 19 15 9720-10440 24 16 10470-10710 15 17 10715-10933 22 18 10940-11094 8 354 Page 1 of 1 Schwartz, Guy L (DOA) From: Schwartz, Guy L (DOA) Sent: Friday, October 12, 2012 3:46 PM To: 'Bill Penrose' Cc: 'clark@greatbearpetro.com' Subject: RE: Merak#1 Well Suspension r7D Z(Z'/01 Bill, You have verbal approval to suspend Merak#1 as proposed below. (Cement plug has been tested to 3000 psi and kill string to 800 ft will be installed.) Please make sure the BPV is tested from below. Submit a formal sundry (10-403) request as soon as possible. Guy Schwartz Senior Petroleum Engineer AOGCC 793-1226 (office) 444-3433 (cell) From: Bill Penrose [mailto:bill@solstenxp.com] Sent: Friday, October 12, 2012 3:19 PM To: Schwartz, Guy L (DOA) Cc: 'clark@greatbearpetro.com' Subject: Merak #1 Well Suspension Guy, Great Bear Petroleum intends to suspend Merak#1 while Great Bear awaits test results from Alcor#1 and Merak#1 in order to determine what operations are to be commenced next. Until such determination is made,the Merak#1 is planned to be configured as indicated on the attached wellbore diagram (forgive the hand-drawn portions—my CAD guy isn't available at present). The 9-5/8"casing has been tested to 3,000 psi. At the surface,the well will be secured with a back-pressure valve and dry hole tree containing 7", 5K valves and a tree cap. If this suspension plan is acceptable I will generate a Sundry Application to cover the work. However, as the drilling rig is just finishing up work on this well, an early verbal or email approval is requested. Regards, Peyrnade Drilling Manager �{ FullColor_sma 310 K Street,Suite 700 Anchorage,Alaska 99501 Main 907-279-6900 Direct 907-264-6114 Cell 907-250-3113 10/12/2012 Merak # 1 P H Proposed Wellbore Diagram •�'3 20" Conductor @ 93' Port Collar @ 500' ► '•••`A: in // i%o:; .:?O: pe 4-pT700 r SIF,' ii�i':".. "�•'•.i« ?,:•: __ Type P ES Stage Tool «'•1 °i w/Packer @ -- 2,400' 13 -3/8" Casing ''•' L-80, 68 lbs/ft, BTC --0.- TD @ 2,441' ♦,o��p'- 0'1 :ii �! mud Ow W. '; .. . roc e. 85460.7 9-5I8" Casing \ , L-80, 47 lbs/ft, BTC -+► �� 8,736' MD/8,731' ND -f-- 8-1/2" Hole ..• e•r ;ce / c1; 114'0/ Merak # 1 TD (y 7,/ • •' t f a • ♦I. w . /l© 7 ' � (150' Below Base Shubiik) DRAWN BY: A. MICI REV: 04 SEP 2012 Page 1 of 1 Schwartz, Guy L (DOA) From: Bill Penrose[bill@solstenxp.com] Sent: Friday, October 12, 2012 3:19 PM To: Schwartz, Guy L(DOA) Cc: 'clark@greatbearpetro.com' Subject: Merak#1 Well Suspension Attachments: Merak#1 WBD 10-12-12.PDF Guy, Great Bear Petroleum intends to suspend Merak#1 while Great Bear awaits test results from Alcor#1 and Merak#1 in order to determine what operations are to be commenced next. Until such determination is made,the Merak#1 is planned to be configured as indicated on the attached wellbore diagram (forgive the hand-drawn portions—my CAD guy isn't available at present). The 9-5/8" casing has been tested to 3,000 psi. At the surface,the well will be secured with a back-pressure valve and dry hole tree containing 7", 5K valves and a tree cap. If this suspension plan is acceptable I will generate a Sundry Application to cover the work. However,as the drilling rig is just finishing up work on this well,an early verbal or email approval is requested. Regards, Penode Drilling Manager x FullColorsma 310 K Street,Suite 700 Anchorage,Alaska 99501 Main 907-279-6900 Direct 907-264-6114 Cell 907-250-3113 1/15/2013 Merak # 1 P H , Proposed Wellbore Diagram ::1*: 20" Conductor @ 93' Port Collar @ 500' al.-- ::::"1:i* "l Oc...se Per"ATc0st�.•:: lel •<:.,. :.•.;:;� ;•gip• W • Type P ES Stage Tool 13 -3/8" Casing I �— w/ Packer @ – 2,400' L- 80, 68 lbs/ft, BTC TD @ 2,441' mud Ali itiH - roc e. 858 9 - 5/8" Casing \ L- 80, 47 lbs /ft, BTC —so— . : 8,736' MD/8,731' ND .. 8-1/2" Hole • '0. C7E;/'6 / c; I/.of Merak # 1 TD ' D /0-, g y rfi.6 (150' Below Base Shublik) DRAWN BY: A. MICI REV: 04 SEP 2012 -"j"\\I Great Bear Petroleum Operating LLC A New Direction for the Last Frontier 601 w 5`h Ave., Suite 505, Anchorage, AK 99501 Phone: (907) 868-8070, Fax: (907) 868-3887 October 12, 2012 Ms. Cathy Foerster, Chair Alaska Oil and Gas Conservation Commission 333 West 7th Ave., Suite 100 Anchorage,Alaska 99501 RE: Weekly Report of Operations Great Bear Petroleum: Merak#1 (PTD#212-101) Dear Ms. Foerster, This is a report of Great Bear Petroleum's well operations on the Merak#1 for the period October 5 through October 11, 2012, inclusive. October 5, 2012 11,094' MW 12.2 ppg Vis 57 sec Incl 2.44° Drill 8-1/2" hole from 11,013' to 11,094' TD. MAD pass w/ LWD tools from TD up to 8,940'. Had to work through several tight spots. October 6, 2012 11,094' MW 12.2 ppg Vis 58 sec Incl 2.64° Finish MAD pass to csg shoe at 8,727'. POH, download and LD BHA. RU WL, RIH w/ logging pass #1. Tag up at 8,740'. POH, change to different hole-finder on bottom of logging tools. RIH, tag up at 8,740'. Would not pass. POH and RD WL. Commence LD HWDP. October 7, 2012 11,094' MW 12.2 ppg Vis 68 sec Incl 2.64° LD HWDP and jars. Test lwr VBR's on 2-7/8" test joint — OK. MU 2-7/8" mule shoe and 30 jts 2-7/8" tbg on DP and RIH. Precautionary wash & ream from csg shoe to 8,764'. RIH on elevators,tag up at 9,200'. Wash&ream from 9,200' to 9,434'. October 8, 2012 11,094' MW 12.2 ppg Vis 59 sec Incl 2.64° Wash & ream to 11,094' TD. C&C hole while RU to cement. Pump Plug #1 as: 5 bbls water + 33 bbls 13.0 ppg spacer + 62 bbls 15.8 ppg Class G cmt + 12 bbls 13.0 ppg spacer. Displace w/ 165 bbls mud. End displacement, attempt to POH. Pipe stuck. Bringing the Unconventional Resource Play to Alaska • • Pump dn DP while working pipe. Lost approx 235 bbls mud to fm while working pipe. Pipe came free, POH to 10,350'. October 9, 2012 11,094' MW 12.2 ppg Vis 59 sec Incl 2.64° POH to 9,727'. Drop DP wiper ball and circ down. RIH, tag top of plug at 10,170', saw Plug #1 lead spacer come to surface. Pump Plug #2 as: 5 bbls water + 33 bbls 13.0 ppg spacer + 62 bbls 15.8 ppg Class G cmt + 12 bbls 13.0 ppg spacer. Displace w/ mud. POH to 9,088', drop DP wiper ball and circ down to 9,362'. Pump Plug #3 as: 5 bbls water + 34 bbls 13.0 ppg spacer + 59 bbls 17.0 ppg Class G cmt + 11 bbls 13.0 ppg spacer. Displace w/ mud. Drop DP wiper ball and POH to 8,322'. Wash dn to 8,575' and circ hole clean. POH, handle tbg cmtg stinger. October 10, 2012 11,094' MW 12.2 ppg Vis 68 sec Incl 2.64° LD bent tbg jts. Test BOPE (weekly test). Test witness waived by AOGCC's John Crisp. RIH w/2-7/8"cmtg stinger on 5"DP to 8,480'. October 11, 2012 11,094' MW 12.2 ppg Vis 75 sec Incl 2.64° RIH, tag firm cement at 8,822'. Order out another batch of cmt. POH LD 3,000' of DP, RIH w/ 3,000' DP out of derrick. Pump Plug #4 as: 5 bbls water + 33 bbls 13.0 ppg spacer + 32 bbls 17.0 ppg Class G cmt + 12 bbls 13.0 ppg spacer. Displace w/ mud. POH to 8,134', drop DP wiper ball and wash dn to 8,475'. C&C mud and perform rig maintenance while WOC. Wash down, tag firm cmt at 8,582' w/20K lbs. Circ suface to surface to even out mud. If you have any questions or require additional information, please contact me at 264- 6114 or 250-3113. Sincerely, For GREAT BEAR PETROLEUM OPERATING LLC Pew Drilling Manager SolstenXP Inc. cc: Clark Clement—Great Bear Bringing the Unconventional Resource Play to Alaska • Great Bear Petroleum O tin LLC 601 W. 5th Ave., Suite 505, Anchorage, AK 99501 Phone: (907) 868-8070, Fax: (907) 868-3887 September 28, 2012 Ms. Cathy Foerster, Chair Alaska Oil and Gas Conservation Commission 333 West 7th Ave., Suite 100 Anchorage, Alaska 99501 RE: Weekly Report of Operations Great Bear Petroleum: Merak#1 (PTD#212-101) Dear Ms. Foerster, This is a report of Great Bear Petroleum's well operations on the Merak#1 for the period September 21 through September 27, 2012, inclusive. September 21, 2012 10,611' MW 11.4 ppg Vis 58 sec Incl 3.54° Drill from 9,610' to 10,611'. CBU, monitor well—static. POH. September 22, 2012 10,611' MW 11.4 ppg Vis 58 sec Incl 3.21° Download and SB BHA. Test BOPE to 250/5,000 psi, test witness waived by AOGCC's Lou Grimaldi. MU Core Assembly#3 and RIH. September 23, 2012 10,644' MW 11.4 ppg Vis 50 sec Incl 3.21° RIH to 9,242', packed off. Backream up then wash and ream to btm at 10,611'. Cut Core#3 from 10,611' to 10,644'. September 24, 2012 10,660' MW 11.6 ppg Vis 63 sec Incl 3.21° Core from 10,644' to 10,659'. Raise MW to 11.6 ppg. Attempt to break core; catcher slipping at 55K lbs overpull. Core one additional foot to 10,660'. Break off core w/65K lbs overpull. POH. Handle core bbls at surface. September 25, 2012 10,749' MW 11.6 ppg Vis 60 sec Incl 3.21° Recover 48.8' of core out of 49' cored. MU new core bit and bbls and RIH. Service rig and PU space-out pup at csg shoe. RIH, washing down from 9,550' to 10,623'. Pump Bringing the Unconventional Resource Play to Alaska sweep, observe 3,270 units trip gas. Drop ball, circ to seat and commence coring. Cut Core #4 from 10,660' to 10,749'. Stop coring, break off w/ 28K lbs overpull. Monitor well—static. POH pumping. September 26, 2012 10,749' MW 11.8 ppg Vis 66 sec Incl 3.21° Pump out of hole to casing shoe. POH on elevators to surface. Handle coring tools. Recovered 89' out of 89' cored. MU new inner bbls and re-run core bit and RIH to csg shoe. Service rig and cont RIH to 9,300'. September 27, 2012 10,753' MW 12.0 ppg Vis 55 sec Incl 3.21° RIH to 10,210'. Ream to 10,586', packed off and stuck. Work free and cont reaming to btm at 10,749'. Cut Core #5 from 10,749' to 10, 753'. ROP 1.5 fph, core barrel/bit appears to be jammed. PU, increase system MW to 12.0 ppg and POH, pumping and backreaming as required to shoe. POH on elevators in cased hole to 300'. If you have any questions or require additional information, please contact me at 264- 6114 or 250-3113. Sincerely, For GREAT BEAR PETROLEUM OPERATING LLC Esti Pentode Drilling Manager SolstenXP Inc. cc: Clark Clement—Great Bear Slinging tine L/nconientional Resource Plcn Al,ska t 4 r Great Bear Petroleum O ratio LLC 601 W. 5th Ave., Suite 505, Anchorage, AK 99501 Phone: (907) 868-8070, Fax: (907) 868-3887 September 21, 2012 Ms. Cathy Foerster, Chair Alaska Oil and Gas Conservation Commission 333 West 7th Ave., Suite 100 Anchorage, Alaska 99501 RE: Weekly Report of Operations Great Bear Petroleum: Merak#1 (PTD#212-101) Dear Ms. Foerster, This is a report of Great Bear Petroleum's well operations on the Merak#1 for the period September 14 through September 20, 2012, inclusive. September 14, 2012 8,770' MW 9.8 ppg Vis 59 sec Incl 8.07° Test BOPE, sensors and alarms. Test witness waived by AOGCC's Chuck Scheve. MU BHA and RIH to firm cmt at 8,590'. Drill out cmt, shoe track and rat hole to 8,750'. Drill 20' of new hole to 8,770'. Prep to swap over to coring fluid system. September 15, 2012 9,012' MW 10.6 ppg Vis 48 sec Incl 8.07° Change out 9.8 ppg intermediate hole drilling mud to 10.4 ppg coring mud. Conduct LOT; leaked off at 14.8 ppg EMW. Rotary drill to core point at 9,012'. Weight up mud system to 10.6 ppg (to reduce background gas) and POH. LD BHA, MU coring assy. September 16, 2012 9,025' MW 10.6 ppg Vis 53 sec Incl 8.07° MU coring assy and RIH. Wash down last stand and tag at 9,012', drop ball. Core from 9,012' to 9,025' at 2 fph. September 17, 2012 9,028' MW 10.6 ppg Vis 55 sec Incl 8.07° Continue coring from 9,025' to 9,028'. Stop coring, break off core w/ 32K lbs overpulkl and POH. Recovered 14.4' of core out of 15.3' cut. Modify core catching assy and RIH w/core assy to 6,930'. Bringing the Unconventional Resource Play to Alaska September 18, 2012 9,080' MW 10.7 ppg Vis 55 sec Incl 8.07° RIH from 6,930' to 8,672'. Wash to 9,028, drop ball. Core from 9,028' to 9,080'. September 19, 2012 9,089' MW 10.8 ppg Vis 58 sec Incl 8.07° Core from 9,080' to 9,089'. Stop rotation and PU 30K lbs overpull to break off core. POH. Recovered 61' of core out of 61' cut. MU directional drilling BHA and RIH. September 20, 2012 9,610' MW 11.1 ppg Vis 58 sec Incl 6.48° RIH to 9,030', MAD pass w/ LWD tools 9,030' to 9,089'. Drill 8-1/2" hole 9,089' to 9,215'. Raise MW to 11.1 ppg(BGG at 2,200 units). Continue drilling/sliding to 9,610'. If you have any questions or require additional information, please contact me at 264- 6114 or 250-3113. Sincerely, For GREAT BEAR PETROLEUM OPERATING LLC &i€ Pe4arode Drilling Manager SolstenXP Inc. cc: Clark Clement—Great Bear 3ungrng the Unconl enhonar Resource Play to A1,3ske • 5-4, 9 \\N:03‘ Great Bear Petroleum Operating LLC A New Qirection for the Last Frontier Ave. X01 Phone: (907) 868-8070, Fax: (907) 868-3887 September 14, 2012 Ms. Cathy Foerster, Chair Alaska Oil and Gas Conservation Commission 333 West 7th Ave., Suite 100 Anchorage,Alaska 99501 RE: Weekly Report of Operations Great Bear Petroleum: Merak#1 (PTD #212-101) Dear Ms. Foerster, This is a report of Great Bear Petroleum's well operations on the Merak#1 for the period September 7 through September 13,2012, inclusive. September 7,2012 8,750' MW 9.7 ppg Vis 55 sec Incl 8.07° Log from 6,980' to surface with triple combo/GEM. PU dipole sonic logging tool and RIH. Tag fill at 8,710' and log to surface. RD WL equip, test BOPE. Test witness waived by AOGCC's Jeff Jones. MU 12-1/4"cleanout BHA. September 8,2012 8,750" MW 9.7 ppg Vis 54 sec Incl 8.07° Finish MU cleanout BHA and RIH to 8,750' TD. C&C hole w/viscous sweeps. POH, LD BHA. September 9,2012 8,750' MW 9.7 ppg Vis 60 sec Incl 8.07° Finish LD BHA. RU csg running equipment. Install 9-5/8" rams and test to 250/3,500 psi. RIH w/9-5/8",47#,L-80,BTC casing to 6,021'. September 10, 2012 8,750' MW 9.7 ppg Vis 60 sec Incl 8.07° Run 9-5/8" casing to 8,727' and land out in wellhead. MU cmt head and lines and circulate well. Test cementing lines and pump first stage cement as follows: 60 bbls 11.0 ppg spacer+ 396 bbls 12.5 ppg lead cement+ 78 bbls 15.8 ppg tail cement. Displace w/ mud using rig pumps. Did not bump plug. Lost 278 bbls mud while displacing. Check floats — OK. Pump second stage as follows: Drop stage tool opening plug and allow to Bringing the Unconventional Resource Play to Alaska fall onto seat. Pressure up to open P-ES cementer. Pump 30 bbls 11.0 ppg spacer+ 160 bbls 15.8 ppg cmt. At 150 bbls pumped, lost returns. Drop closing plug and displace w/ rig pumps. Pressure up to close stage tool. RD cementing equipment. September 11, 2012 8,750' MW 9.7 ppg Vis 59 sec Incl 8.07° RD cmtg equip. Freeze protect 9-5/8" x 13-3/8" annulus w/ 3-1/2 bbls diesel. Install packoff and test void to 5,000 psi. RD choke and kill lines, break down and remove BOP components from cellar. Install new tubing spool on wellhead. NU adapter flange and re-assemble BOP stack and choke&kill lines. September 12, 2012 8,750' MW 9.7 ppg Vis 58 sec Incl 8.07° Torque BOP flanges, change out top and bottom rams to 2-7/8" x 5-1/2" variables. Install MPD rotating head. Plumb in koomey unit and function test it and all rams. Continue RU MPD equipment. Body test BOPs to 250/3,500 psi. Load shed w/DP and MU/SB 2,000' of stands f/shed. RU to test BOPs. September 13, 2012 8,750' MW 9.8 ppg Vis 58 sec Incl 8.07° Test upper and lower VBRs to 250/3,500 psi. Continue RU of MPD system. PU/MU BHA and RIH. Tag up on ES Cementer plugs at 2,377'. Mill up plugs. Pump up to 2,950 psi to set 9-5/8" TAM packer. Bleed off. Pressure up to 2,250 psi to close valve on ECP. Bleed off then pressure back up to 2,250 psi to confirm valve closure. Pressure test csg to 3,000 psi for 30 minutes—good test. POH, LD BHA. If you have any questions or require additional information, please contact me at 264- 6114 or 250-3113. Sincerely, For GREAT BEAR PETROLEUM OPERATING LLC Peo4e Drilling Manager SolstenXP Inc. cc: Clark Clement—Great Bear Bringing the Unconventional Resource Plat to Alaska / 1) \'"\ Great Bear Petroleum 0 -ratin LLC 601 W. 5th Ave., Suite 505, Anchorage, AK 99501 Phone: (907) 868-8070, Fax: (907) 868-3887 September 7, 2012 Ms. Cathy Foerster, Chair Alaska Oil and Gas Conservation Commission 333 West 7th Ave., Suite 100 Anchorage, Alaska 99501 RE: Weekly Report of Operations Great Bear Petroleum: Merak#1 (PTD#212-101) Dear Ms. Foerster, This is a report of Great Bear Petroleum's well operations on the Merak #1 for the period August 31 through September 6,2012, inclusive. August 31, 2012 5,625' MW 9.3 ppg Vis 42 sec Incl 1.58° Drill/slide 12-1/4" hole from 4,547' to 5,505'. Make wiper trip to 4,545'- several tight spots pulling out, hole slick going back in. Drill from 5,505' to 5,625'. September 1, 2012 6,750" MW 9.3 ppg Vis 42 sec Incl 0.79° Drill/slide from 5,625' to 6,560'. Make wiper trip to 5,495' — had to back-ream from 5,793' to 5,580' and pump out from 5,580' to 5,495', trip back in went smoothly. Drill from 6,560' to 6,750'. September 2, 2012 7,708' MW 9.4 ppg Vis 48 sec Incl 0.89° Drill from 6,750' to 7,612'. Make wiper trip to 6,460' — minor tight spots coming out, slick going back in. Drill/slide from 7,612' to 7,708'. September 3, 2012 8,412' MW 9.5 ppg Vis 48 sec Incl 0.89° Drill/slide from 7,708' to 8,412'. September 4, 2012 8,750' MW 9.6 ppg Vis 49 sec Incl 9.18° Slide/drill from 8,412' to 8,750'. C&C hole to circulate out gas. Monitor well — static. Commence short trip to surface casing shoe. Bringing the Unconventional Resource Play to Alaska September 5,2012 8,750' MW 9.6 ppg Vis 47 sec Incl 8.6T POH from 5,347'. Had to back ream 3,400' to 3,113'. POH to casing shoe at 2,441'. C&C hole while performing rig maintenance. RIH from 2,441' to 8,377'. Wash and rotate to 8,750'. Pump sweep, C&C mud. September 6, 2012 8,750' MW 9.7 ppg Vis 56 sec Incl 8.07° C&C hole. POH, LD BHA. Test blind rams to 250/5,000 psi. RU to run WL tools. RIH w/Triple Combo/GEM,tag up at 8,720'. Begin logging up at 15 fpm. If you have any questions or require additional information, please contact me at 264- 6114 or 250-3113. Sincerely, For GREAT BEAR PETROLEUM OPERATING LLC 'e117'e ctode Drilling Manager SolstenXP Inc. cc: Clark Clement—Great Bear &liv,ng the Unconventional Resource Play to AOska r -- Great Bear Petroleum O ratin LLC 601 W. 5th Ave., Suite 505, Anchorage, AK 99501 Phone: (907) 868-8070, Fax: (907) 868-3887 August 31, 2012 Ms. Cathy Foerster, Chair Alaska Oil and Gas Conservation Commission 333 West 7th Ave., Suite 100 Anchorage, Alaska 99501 RE: Weekly Report of Operations Great Bear Petroleum: Merak#1 (PTD#212-101) Dear Ms. Foerster, This is a report of Great Bear Petroleum's well operations on the Merak #1 for the period August 24 through August 30, 2012, inclusive. August 24, 2012 2,462' MW 9.6 ppg Vis 85 sec Incl 0.22° Drill 16" hole from 2,080' to 2,462'. CBU, POH to HWDP at 700'. RIH to TD, CBU. Monitor well—stable. POH, LD directional tools. August 25, 2012 2,462' MW 9.5 ppg Vis 65 sec Incl 0.22° Finish LD tools. Make dummy run w/csg hgr into WH. RU to run casing. Run 13-3/8", 68#, L-80, BTC casing to 2,447' and land out. C&C mud, RU to run inner cementing string. August 26, 2012 2,462' MW 9.5 ppg Vis 50 sec Incl 0.22° RIH w/ cmtg stinger on DP. Sting into FC, slack off w/ 10K lbs wt. RU to cmt. Test lines to 3,000 psi then pump cmt as follows: 5 bbls H2O + 60 bbls 10.5 ppg weighted spacer w/red dye+ 361 bbls Type L lead cement+ 82 bbls 15.8 ppg Class G tail cement. Drop plug, pump away with 10 bbls H2O, switch to rig pumps and displace w/ 27 bbls mud. Bump plug and check floats — OK. 180 bbls excess lead cement received back at surface. Unsting f/FC, CBU, flush diverter and lines and POH. Commence ND diverter. Bringing the Unconventional Resource Play to Alaska August 27, 2012 2,462' MW 9.5 ppg Vis 50 sec Incl 0.22° Finish ND diverter system. MU csg head and seals. Test seals. NU adapter spool, single gate rams, mud cross, double gate rams, annular preventer. MU choke, kill and koomey lines. Function test BOPE, install riser and mouse hole. August 28, 2012 2,462' MW 9.2 ppg Vis 45 sec Incl 0.22° Test BOPE to 250/5,000 psi, annular to 250/2,500 psi. Test witnessed by AOGCC's Lou Grimaldi. Dummy run 9-5/8" casing hanger into wellhead. PU/MU 12-1/4" drilling BHA, RIH w/BHA on DP singles from pipe shed. August 29, 2012 3,496' MW 9.2 ppg Vis 41 sec Incl 0.29° RIFT picking up singles from 741' to 2,348'. Displace spud mud from hole w/ LSND drilling mud. Test csg to 3,500 psi for 30 min. Drill shoe track, rathole and 20' of new hole to 2,482'. Perform LOT —yielded 13.1 ppg EMW. Drill 12-1/4" hole from 2,482' to 3,496'. August 30, 2012 4,625' MW 9.3 ppg Vis 42 sec Incl 0.68° Make wiper trip to 2,441 —work through tight spots w/ 20K lbs overpull. RIH to btm — no tight spots. Drill 12-1/4" hole from 3,496' to 4,547'. CBU, monitor well — static. Make wiper trip to 3,450' —work through tight spots w/ 20 — 30K lbs overpull. RIH to btm—no tight spots. Drill from 4,547' to 4,625'. If you have any questions or require additional information, please contact me at 264- 6114 or 250-3113. Sincerely, For GREAT BEAR PETROLEUM OPERATING LLC Pe ode Drilling Manager SolstenXP Inc. cc: Clark Clement—Great Bear grmainq the Unconventional Resource Pial to Aiasba 1 0 y Great Bear Petroleum Operating LLC 601 W. 5th Ave., Suite 505, Anchorage, AK 99501 Phone: (907) 868-8070, Fax: (907) 868-3887 August 24, 2011 Ms. Cathy Foerster, Chair Alaska Oil and Gas Conservation Commission 601 West 5th Ave.. Suite 505 Anchorage,Alaska 99501 RE: Weekly Report of Operations Great Bear Petroleum: Merak#1 (PTD#212-101) Dear: Ms. Foerster. This is a report of Great Bear Petroleum's well operations on the Merak#1 for the period August 20 through August 23,2012. inclusive. August 20,2012 52' MW ----ppg Vis -- sec Incl ----° Accept rig at 1800 hrs. Unload mud products. PU DP from pipe shed, MU in stands and stand back in derrick. Tag up at 52' inside of conductor. Function test diverter. Finish building berms around rig components. August 21, 2012 318' MW 8.8 ppg Vis 34 sec Incl ---- MU and SB DP in derrick. Test diverter system, rig alarms and PVT sensors—witnessed by AOGCC's Jeff Jones. Load pipe shed with DP and 13-3/8" csg. MU BHA #1, load additional BHA components into pipe shed. Hold pre-spud safety mtg. Clean out conductor from 43' to 117'. Spud well at 02:24, 8/22/12 and drill 16" hole 117' to 318'. CBU, POH to PU directional drilling tools. August 22, 2012 900' MW 9.2 ppg Vis 200 sec Incl 1.20° POH to 49', MU 8" directional tools. Shallow-test tools and RIH. Drill 16" hole 318' to 707'. Lost 300 psi pump pressure and ROP became erratic. POH. Bit worn but no probs found. MU new bit. RIH and drill 707' to 900'. Bringing the Unconventional Resource Play to Alaska August 23, 2012 2,080' MW 9.6 ppg Vis 180 sec Incl 0.73° Drill 16"hole 900' to 2,080', pumping 20 bbl hi-vis sweeps as necessary. If you have any questions or require additional information, please contact me at 264- 611d nr')cO-'111'1 Sincerely, For GRP AT RF A R PFTR(N FT TM 013FR A TING.T I C 'lE ea'tode Drilling Manager CnlctenXP Inc re. Clark Clement—Great Rear Bunging the Unconventional Resource Play to Alaska RECEIVED SEP 12 2012 il/i\ . AOGCC ;. } Great Bear Petroleum Operating LLC A New Direction for the Last Frontier 601 W. 5`1 Ave., Suite 505, Anchorage, AK 99562. Phone: (907) 868-8070, Fax: (907) 868-3887 September 12, 2012 Ms. Cathy Foerster, Chair Alaska Oil and Gas Conservation Commission 333 West 7th Ave., Suite 100 Anchorage, Alaska 99501 RE: Amended Application for Permit to Drill Change of Approved Program: Merak #1 (PTD No. 212-101) Dear Ms. Foerster, Great Bear Petroleum Operating LLC hereby applies for an amended Permit to Drill to incorporate program changes for drilling and completing the Merak #1, a new oil exploration well located onshore near the Dalton Highway south of Deadhorse, Alaska. A Permit to Drill for the Merak #1 was issued by the AOGCC on August 7, 2012 and drilling commenced there on August 22. Since that time, events have shown the desirability of making two significant changes to the approved program. i) .First, ongoing analyses of the cores obtained in the previously drilled Alcor #1 indicate a new optimal azimuth for the planned horizontal sidetrack in the Merak #1. ' Consequently, a new directional plan has been designed and is submitted here for r approval. B NL 7 So - - `l Secondly, whereas the original well plan called for an intermediate 7" casing string and a 4-1/2" liner, both of which would experience maximum treating pressures during hydraulic fracturing operations, the proposed new plan calls for a 7" drilling liner hung in the 9-5/8" intermediate casing and the 4-1/2" liner, after being hung in the 7" liner, will be tied back to surface. In this configuration, only the 4-1/2" string will experience fracture treating pressures. A revised wellbore schematic is attached to illustrate this. Bringing the Unconventional Resource Play to Alaska September 12, 2012 Page 2 of 2 If you have any questions or require additional information, please contact me at (907) 868-8070 or (281) 828-0389. Sincerely, Great Bear Petroleum Operating LLC Ce#,4)& Clark Clement, Chief Operating Officer Attachments Btrngng the Unconv ntron0l Resource Play to AloSAO 4? w\1/7/1.1THE STATE Alaska Oil and Gas !j 4 S °fALA � Conservation Commission _ GOVERNOR SEAN PARNELL 333 West Seventh Avenue OP. Anchorage, Alaska 99501-3572 ALAS Main: 907.279.1433 Fax: 907.276.7542 Clark Clement Chief Operating Officer Great Bear Petroleum Operating, LLC 601 W 5th Avenue, Suite 505 Anchorage, AK 99501 Re: Exploratory Field, Exploratory Pool, Merak #1 Great Bear Petroleum Operating, LLC Permit No: 212-101 (revised) Surface Location: 45' FSL, 5008' FEL, T7N, R14E, SEC. 8, UM Bottomhole Location: 1746' FNL, 3231' FEL, T7N, R14E, SEC. 17, UM Dear Mr. Clement: Enclosed is the approved application for permit to drill the above referenced exploration well. This permit supersedes and replaces the permit previously issued for this well dated August 7, 2012. In accordance with 20 AAC 25.005(f), all records, data and logs acquired for the pilot hole must be clearly differentiated in both name Merak #1 plus PH and API number 50-223-20027-70 from records, data and logs acquired for well Merak #1. This permit to drill does not exempt you from obtaining additional permits or approvals required by law from other governmental agencies, and does not authorize conducting drilling operations until all other required permits and approvals have been issued. In addition, the Commission reserves the right to withdraw the permit in the event it was erroneously issued. A weekly status report is required from the time the well is spudded until it is suspended or plugged and abandoned. The report should be a generalized synopsis of the week's activities and is exclusively for the Commission's internal use. Operations must be conducted in accordance with AS 31.05 and Title 20, Chapter 25 of the Alaska Administrative Code unless the Commission specifically authorizes a variance. Failure to comply with an applicable provision of AS 31.05, Title 20, Chapter 25 of the Alaska Administrative Code, or a Commission order, or the terms and conditions of this permit may result in the revocation or suspension of the permit. Sincerely, Cathy Pi. Foerster Chair rck DATED this 3 day of October, 2012. cc: Department of Fish & Game, Habitat Section w/o encl. (via e-mail) Department of Environmental Conservation w/o encl. (via e-mail) RECEIVED STATE OF ALASKA SEP 1 2 2012 ALASKA OIL AND GAS CONSERVATION COMMISSION PERMIT TO DRILL (AMENDED) AOGCC lb eD 20 AAC 25.005 1a.Type of Work. 1b.Proposed Well Class Development-Oil LI Service- Winj ❑ Single Zone ❑ 1c Specify if well is proposed for Drill 0 • Rednll ❑ Stratigraphic Test❑ Development-Gas❑ Service-Supply ❑ Multiple Zone 0 • Coalbed Gas❑ Gas Hydrates ❑ Re-entry ❑ Exploratory 1=1 ' Service- WAG ❑ Service-Disp ❑ Shale Gas ❑ 2 Operator Name 5 Bond Blanket Ei Single Well❑ 11.Well Name and Number Great Bear Petroleum Operating LLC Bond No. B007354 • Merak#1 . ------------- -- ----- 3 Address: 6 Proposed Depth 12. Field/Pool(s) 601 W.5th Avenue,Suite 505,Anchorage,Alaska 99501 MD 14,600' . TVD 10,507'. Exploration . 4a Location of Well(Governmental Section). 7.Property Designation(Lease Number) Surface 45'FSL,5008 FEL,Sec 8,T7N,R14E,UM • ADL 391706 . Top of Productive Horizc 4,144'FNL,841'FEL,Sec 7, T7N,R14E,UM 8.Land Use Permit 13 Approximate Spud Date LONS 11-007 August 22,2012 " Total Depth 1,746'FNL,3.231'FEL,Sec 7,T7N,R14E,UM 9 Acres in Property: 14 Distance to Nearest Property. 5630 5200' 4b.Location of Well(State Base Plane Coordinates-NAD 27) 10 KB Elevation above MSL. . 198.4feet 15 Distance to Nearest Well Open Surface x-661411.16 , y- 5839740.79 • Zone-4 GL Elevation above MSL. 175.1feet to Same Pool:• 1.5 mi.to Alcor#1 16 Deviated wells: Kickoff depth 8,850'BKB feet 17 Maximum Anticipated Pressures in psig(see 20 MC 25 035) Maximum Hole Angle: 90 degrees Downhole 5,837 psi Surface 4,758 psi 18 Casing Program Specifications Top - Setting Depth - Bottom Cement Quantity,c f or sacks Hole Casing Weight Grade Coupling Length MD TVD MD TVD (including stage data) _ 26 20" 129.45 X-56 weld 80' 0' 0' 80' 80' Driven,with surface grout 16" 13 3/8" 68# L-80 BTC 2,500' 0' 0' 2,500' 2,500' 3,350 its PF L+380 ft'Class G 12 1/4" 9 5/8" 47# L-80 BTC-M 8,735' 0' 0' 8,735' 8,735' 2021 ft3Lead 413 ft3 Tail 804 ft3 Ann 8 1/2" 7" 29# P-110 _ BTC-M 2,807' 8,400' 8,400' 11,207' 10,466' 430 ft3 Class G 6 1/8" 4 1/2" 13.5# P-110 H 521 4,000' 10,600' 10,251' 14,600' 10,507' un-cemented,swell packers 19 PRESENT WELL CONDITION SUMMARY(To be completed for Redrdl and Re-Entry Operations) Total Depth MD(ft): Total Depth ND(ft) Plugs(measured) Effect.Depth MD(ft) Effect.Depth TVD(ft). Junk(measured). 8,750' 8,745' None 8,750' 8,745' None Casing Length Size Cement Volume MD ND Conductor/Structural 94' 20" N/A 117' 117' Surface 2,418' 13-3/8" 361 bbls PF lead+82 bbls G tail 2,441' 2,441' Intermediate Production Liner — Perforation Depth MD(ft) Perforation Depth TVD(ft). 20 Attachments Property Plat ❑ BOP Sketch❑ Drilling Program ❑ Time v Depth Plot ❑ Shallow Hazard Analysis❑ Diverter Sketch❑ Seabed Report LI Drilling Fluid Program ❑ 20 AAC 25.050 requirements❑ 21 Verbal Approval Commission Representative. Date 22 I hereby certify that the foregoing is true and correct Contact Bill Penrose 907-250-3113 Printed Name Clark Clement Title Chief Operating Officer 244 Signature l Phone 907-868-8070 Date //2.//1� Commission Use Only �` ` Permit to Drill API Number Permit Approval See cover letter for other Number: 212-101 • 50-223-20027-00-00 Date 8/7/2012 requirements. —✓ Conditions of approval If box is checked,well may not be used to explore for,test,or produce coalbed methane,gas hydrates,or gas contained in shales L� Other Samples req'd: Yes 0 No❑ Mud log req'd Yes 21 No❑ n H2S measures. Yes d Not❑ Directional svy req'd Yes No❑ Or it i h f l C St •-/-1:o'..s• a( al' .�C t rs�t S-14.. 4L C.2 1z-- /ot) '/ Tr C 61 L /pJ re-7.Z APPROVED BY THE COMMISSION G DATE f0 -12._._ 6)1-14)/ f -4-' ,COMMISSIONER ORIGINAL /607/7(2.____ Form 10-401(Revised 7i2009) This permit is valid for 24 months from the date of approval(20 AAC 25.005(8)) Submit in Duplicate 1 it/1� q RECEIVED pp _ ..�.._ ... - .....�,� SEP 27 2012 4 AOGCC i • ) y)).Is,\ , l' / .° ) Great Bear Petroleum Operating LLC A New Direction for the Last Frontier 601 W. 5'1 Ave., Suite 505, Anchorage, AK 99501 Phone: (907) 868-8070, Fax: (907) 868-3887 September 27, 2012 Ms. Cathy Foerster, Chair Alaska Oil and Gas Conservation Commission 333 West 7th Ave., Suite 100 Anchorage, Alaska 99501 RE: Additional Information for Amended Application for Permit to Drill Change of Approved Program: Merak #1 (PTD No. 212-101) Dear Ms. Foerster, On September 12 Great Bear Petroleum Operating LLC applied for an amended Permit to Drill to incorporate program changes for drilling and completing the Merak #1 oil exploration well located onshore near the Dalton Highway south of Deadhorse, Alaska. Subsequently, we were verbally requested by a Commission representative to provide additional information. Per that request, please find enclosed a detailed cementing program for the 7" liner, a modified summary drilling procedure and an updated wellbore schematic. If you have any questions or require additional information, please contact me at (907) 868-8070 or (281) 828-0389. Sincerely, Great Bear Petroleum Operatin' LLC Clark Clement, Chief Operating Officer Attachments Bringing the Unconventional Resource Play to Alaska Merak #1 General Drilling Program 1. Ensure regulatory compliance training is complete and key personnel are fully aware of responsibilities. 2. Install 20" conductor and a 10' diameter, 10' deep cellar. 3. Diverter riser assembly should be made to length according to diverter space out schematic. 4. Conduct specific tour safety meetings with each crew on the potential of gas hydrates or shallow gas and the handling of same. 5. Pick up and stand back 2,000' of 4" drill pipe and 500' of HWDP. Note: 4", S-135, 15.7#, XT 39 drill pipe will be used for all hole sections on Merak#1. 6. Notify the AOGCC within 48 hours of intent to spud and plans to perform diverter function test and drills. 7. Ensure that pipe rams are available for the following pipe sizes: 9-5/8", 7" and 4 1/2" casing, 4" drill pipe. 8. Install 21 %" 2000 psi diverter with 16" outlet line. Fill diverter & riser with water to check for leaks. Function test and record on IADC drilling report. Send completed Diverter Test form to AOGCC as specified on the form. Hold diverter drill prior to drilling surface hole. RU cement return lines from the 4" outlets on the 20". 9. A conventional spud mud, 8.8 ppg minimum,will be used on the surface hole. 10. PU 16" bit and bottomhole assembly including MWD. Test the BHA below the rotary table. 11. Spud well with reduced drilling parameters. Gradually increase drilling parameters when the BHA is below the conductor shoe. 12. Drill 16" hole vertically to 2,500' as per the directional plan and mud plan. Controlling ROP may be necessary to prevent packing off, lost circulation or flow over the top of the bell nipple. No sliding is expected in this section. 13. Actual TD will be based on ROP and mud logging data so as to place shoe in minimum 50' shale section if possible. Great Bear Geologist will assist in picking casing seat. 14. Make short trips as required, circulate and condition mud and POH. Stand back the BHA to , save time and move as rapidly as feasible toward running surface casing. The surface hole BHA can be laid down after cementing 13 3/8" casing. 15. Rig up casing running equipment and Frank's top drive fill up tool. 16. Run 13 3/8", 68#, L-80, BTC casing, monitoring returns and filling casing with fill up tool. A TAM collar will be installed in the 13 3/8" casing at 500' to be used in case a second stage cement job is required. 17. Cement 13 3/8" casing to surface, using the inner string method, according to the cementing program. Notify AOGCC immediately if the cement did not reach surface. Perform second stage cementing through the TAM collar if the cement did not reach surface. 18. Nipple down the diverter. 19. Make up and install GE O&G 13 5/8", 5k casing head, 13 5/8" drilling spool and 13 5/8" 5K BOP stack. Note: 11", 10k x 13 5/8" 5k intermediate head will be installed after landing and cementing 9 5/8" casing. 20. Notify AOGCC 48 hours prior to testing BOPE. Test BOPE to 250 psi low and 5,000 psi high (See Permit to Drill for reference). Note: BOP tests are required every 7 days on exploration drilling projects. 21. MU 12 1/4" directional BHA with LWD tools (DIR, GR, PWD) and test. Spud mud will be used to drillout the shoe track. Test casing to 3,000 psig for 30 min making sure to chart the test. Drill shoe track and 20' of new formation. 22. Switch out to 9.2 ppg LSND per mud program before LOT. 23. Perform LOT. Record the results on the Morning Report and in the IADC report. Note: Minimum acceptable LOT is 11.5 ppg. 24. Circulate and establish baseline parameters. Drill vertical 12 1/4" hole with mud motor and LWD-PWD system. 25. Slow down drilling and circulate for samples according to Great Bear mud logging procedures.The wellsite geologist will assist in formation tops determination. 26. Drill to intermediate casing point at top of the HRZ at-8,650' MD/TVD. Great Bear geologist will determine casing point. 27. Circulate and condition mud and POOH for open hole logs. 28. Perform E-line logging as follows: Triple Combo with GEM and Compensated Spectral Gamma Ray Dipole Sonic and OMR'(Oil Mud Micro Imager) MRIL (Nuclear Magnetic Resonance Tool) 29. After e-line work is complete, perform a wiper trip and prepare to run casing. 30. Run 9 5/8", 47#, L-80, BTC casing and cement per program. Establish injectivity into 9 5/8"x 13 3/8" annulus. Install 9 5/8" pack-off and test, RU to annulus and downsqueeze 9 5/8" x 13 3/8" annulus with Permafrost cement per the program. 31. Nipple down stack and install intermediate wellhead spool. NU BOP and test. Install bowl protector. 32. PU clean out BHA. RIH. Test casing to 3000 psi. Drill shoe track and 20' new hole. Displace to 9.4 ppg MOBM coring fluid. Note: Density of coring fluid will be increased up to 10.5 , ppg as needed for pore pressure and for shale stability. Perform FIT to 11.5 ppg EMW. Drill to core point per geologist. POOH. 33. MU coring BHA. Core the HRZ formation as directed by Geologist. POOH with coring tools. _ Cut and package cores and send for lab analysis. 34. MU and RIH with 8 1/2" drilling BHA and LWD. Ream through the cored hole and continue drilling to the Kingak core point per Great Bear Geologist. The LWD logging suite will include • DIR, GR, PWD. Circulate and condition for coring. POOH. 35. MU coring BHA. Core the Kingak formation as directed by Geologist. POOH with coring • k/" tools. Cut and package cores and send for the lab analysis. Ce � ', 36. MU and RIH with 8 1/2" drilling BHA and LWD. Ream through the cored hole and continue ° drilling to the Shublik core point per Great Bear Geologist. The LWD logging suite will include DIR, GR, PWD. Circulate and condition for coring. POOH. 37. MU coring BHA. Core 90 to 120 ft (one or two trips) in the Shublik formation as directed by Geologist. POOH with coring tools. Cut and package cores and send for the lab analysis. 38. Finish drilling the 8 %" hole section to 10,794 ft or 150 ft below base of Shublik as directed by Geologist. Back-ream and MAD pass through all pay zones. POOH BHA. C 39. Prepare for the Reservoir Evaluation E-line operations. ref 40. Perform E-line logging as follows: Triple Combo with GEM and Compensated Spectral Gamma Ray Dipole Sonic and OMRI(Oil Mud Micro Imager) MRIL (Nuclear Magnetic Resonance Tool) 41. After e-line work is complete, perform a wiper trip and prepare to plug back the open hole to approx. 9,100 ft. 42. RIH with cement stinger. Lay consecutive, balanced cement plugs from TD to approx. 9,100 ft. The top cement plug will be used as a kick-off plug for the sidetrack. 43. Install and test surface equipment for Managed Pressure Drilling (MPD) in the sidetrack hole. An MPD valve numbering diagram (VND) is attached. 44. MU and RIH with 8 %" directional assembly with LWD. Kick-off the cement plug. Maintain constant ECD via MPD as needed to stabilize shales. Drill to the top of the Shublik formation (+/- 10,939, 10,544' ND) per the directional plan. Circulate and condition mud • and POOH. 45. Rig down MPD equipment. Install and test rams for 7" casing. Run 7", 29#, P-110, BTC-M liner per MPD and cementing procedures. Top of liner and cement to be 280 ft above 9 5/8" shoe at top HRZ. US Lr L" p►r Fit'srCA5r - .4 across 46. ND stack and install GE wellhead spool. Test wellhead and BOPE. r` r"r a cfr 2) 47. MU and RIH with 6 1/8" bit and directional assembly. LWD to include GR, RES and PWD. cook Pressure test 7" liner and hanger to 3500 psi for 30 min. Displace well to 9.2 ppg KCI/Polymer WBM for drilling the Shublik lateral. 48. Drill out 7" shoe and 20 ft new hole. Perform FIT to 11.5 ppg. 71/:-.1•17' 49. Directionally drill 3,000 ft horizontal hole in the Shublik per directional plan. Condition hole and POOH. 50. Install and test rams for 4 1/2" casing. 51. MU and run 4 1/2", 13.5#, P-110, Hydril 521 liner with 16 swell packers per completion procedure. Displace liner and open hole with MOBM to activate swell packers. Set VersaFlex liner hanger with top at approx 10,439' MD (10,300' ND). Test hanger to 3500 psi. Displace well to 9.8 ppg NaCI. POOH with liner running tool while laying down drill pipe. 52. MU and run 4 1/2", 13.5#, P-110, Hydril 521 tie-back tubing to the 4-1/2" liner hanger. Sting ✓ into tie-back receptacle and land out. 53. Test 4-1/2" completion to 3500 psi. Install dry hole tree and test against test plug to 10,000 psi. Remove test plug (two-way check) and install back pressure valve 54. Rig down Nabors 105 AC and move to Alcor#2. At this point the operations on the Merak #1 well will be complete. An application for the 17 Sundry Notice to stimulate and test will be submitted separately. Casing will be tested to 8000 psi as part of the stimulation program. 6 Merak # 1 Proposed Wellbore Diagram ," -.in- 20" Conductor @ 93' Port Collar @ 500' —� E �� �iType P ES Stage Tool 13 - 3/8" Casing w/ Packer @ — 2,400' L- 80, 68 lbs/ft, BTC —� TD @ 2,441' ,, M O .p a— �iy p) Z4 C H • Top of 7" Liner 8,446' MD / 8,441' TVD aha;y6J .40 •. 4-1/2" Liner 9 - 5/8" Casinga P-110, 13.5 lbs /ft, HY521 L- 80, 47 lbs /ft, BTC , Liner Top 10,600' MD / 10,278' TVD 8,726' MD / 8,721' TVD g7Zu . 7" Liner (Top Shublik) :<44 , P - 110, 29lbs /ft, BTC - M 11,071' MD / 10,466' TVD [1p it • Irak # 1 PH TO Merak # 1 TD 664' MD / ,664' TVD 14,572' MD / 10,536' TVD (150' Below Base Shublik) (Mid - Shublik) DRAWN BY: A. MICI REV: 13 SEP 2012 Job information 7"Intermediate Liner Well Name:Merak Well#: 1 9-5/8" Intermediate Casing 0-8730 ft(MD) Outer Diameter 9.625 in Inner Diameter 8.681 in Linear Weight 471bm/ft Casing Grade L-80 8-1/2" Intermediate 2 Hole 2 8730- 11071 ft(MD) Inner Diameter 8.500 in Job Excess 20% 7" Intermediate Liner 8480- 11071 ft(MD) Outer Diameter 7.000 in Inner Diameter 6.184 in Linear Weight 291bm/ft Casing Grade P-110 5" Drill Pipe 0-8480 ft(MD) Outer Diameter 5.000 in Inner Diameter 4.276 in Linear Weight 19.50 Ibm/ft Tubing Grade S-135 Mud Type Oil Based Mud Weight 11.201bm/gal BHST 200 degF BHCT 160 degF Calculations 7"Intermediate Liner Spacer: 204.41 ft*0.2747 ft3/ft*0% = 56.15 ft3 Total Spacer = 56.15 ft3 = 10.00 bbl Spacer: 817.65 ft*0.2747 ft3/ft*0% = 224.58 ft3 Total Spacer = 224.58 ft3 = 40.00 bbl Cement : (2591.00 ft fill) 250.00 ft *0.1438 ft3/ft*0% = 35.94 ft3 2341.00 ft* 0.1268 ft3/ft*20% = 356.23 ft3 Primary Cement = 392.17 ft3 = 69.85 bbl Shoe Joint Volume: (85.00 ft fill) 85.00 ft*0.2086 ft3/ft = 17.73 ft3 = 3.16 bbl Tail plus shoe joint = 409.90 ft3 = 73.01 bbl Total Tail (13_5_!!k Total Pipe Capacity: 8480.00 ft*0.0997 ft3/ft = 845.67 ft3 2591.00 ft*0.2086 ft3/ft = 540.42 ft3 = 246.87 bbl Displacement Volume to Shoe Joint: Capacity of Pipe-Shoe Joint = 246.87 bbl-3.16 bbl = 243.71 bbl Job Recommendation 7"Intermediate Liner Fluid Instructions Fluid 1:Water Spacer Water Spacer Fluid Density: 8.33 lbm/gal Fluid Volume: 10 bbl Fluid 2: Rheologically Enhanced Spacer TUNED SPACER III Fluid Density: 11.501bm/gal 2 gal/bbl Dual Spacer Surfactant B(Surfactant) Fluid Volume: 40 bbl 146.5 lbm/bblBarite(Heavy Weight Additive) Fluid 3:Primary Cement HALCEM(TM)SYSTEM Fluid Weight 15.801bm/gal Slurry Yield: 1.15 ft3/sk Total Mixing Fluid: 4.97 Gal/sk Top of Fluid: 8480 ft Calculated Fill: 2591 ft Volume: 73.01 bbl Calculated Sacks: 356.44 sks Proposed Sacks: 360 sks V Fluid 4:Water Spacer Water Spacer Fluid Density: 8.33 lbm/gal Fluid Volume: 10 bbl Fluid 5: Mud Mud Fluid Density: 11.20 Ibm/gal Fluid Volume 233.71 bbl Job Procedure 7"Intermediate Liner Detailed Pumping Schedule Fluid# Fluid Fluid Name Surface Estimated Downhole Type Density Avg Rate Volume lbm/gal bbUmin 1 Spacer Spacer 8.3 5.0 10 bbl 2 Spacer Rheologically Enhanced 11.5 5.0 40 bbl Spacer 3 Cement Primary Cement 15.8 5.0 360 sks 4 Spacer Displacement Fluid 8.3 5.0 10 bbl 5 Mud Displacement Fluid 11.2 5.0 233.71 bbl 1:11 1 Great Bear Petroleum Great Bear Project Great Bear Plan Merak #1 1 i Merak #1 ST1 Plan: Merak #1 ST1 WP16.0A Standard Proposal Report 04 September, 2012 '''-i -I 2 k_ I 4 E HALLIBURTON Sperry Drilling Services i HALL ,BURTON °RENCE INFORMATION Co-ordinate(N/E)Reference: Well Plan Merak#1.True North Vertical(ND)Reference: Actual RKB @ 196.42ft(KBE©174.7+Actual(g21.72) Measured Depth Reference: Actual RKB(0 196.42ft(KBE(§174.7+Actual©21.72) rf,4 :perm Drilling Calculation Method: Minimum Curvature Great Bear Petroleum LLC CASING DETAILS SURVEY PROGRAM TVD MD Name Size Date:2012-09-04T00:00:00 Validated.Yes Version: 2446.79 2447.00 13 3/8" 13.375 8796.83 8800.00 9 5/8" 9.625 Depth From Depth To Survey/Plan Tool 10466.40 11207.00 7" 7.000 205.22 659.01 Merak#1 Rig Surveys(MWD_lnterp+Azi)(Merak#1) MWD_Interp Azi 10506.69 14599.99 4-1/2" 4.500 755.48 2416.13 Merak#1 Rig Surveys(MWD+sag)(Merak#1) MWD+sag 2476.15 7166.22 Merak#1 Rig Surveys (MWD+sag)(Merak#1) MWD+sag 7166.22 8800.00 Merak#1 WP16.0(Merak#1) MWD+sag COMPANY DETAILS: Great Bear Petroleum 8800,00 8850.00 Merak#1 WP16.0(Merak#1) MWD+sag 8850.00 11207.00 Merak#1 ST1 WP16.0A(Merak#1 ST1) MWD+sag Calculation Method Minimum Curvature 11207.00 14599.99 Merak#1 ST1 WP16.0A(Merak#1 ST1) MWD+sag Error System: ISCWSA Scan Method. Tray.Cylinder North Error Surface Elliptical Conic Warning Method: Error Ratio WELL DETAILS: Plan Merak#1 Ground Level: 174.70 +N/-S +E/-W Northing Easting Latittude Longitude Slot,. 0.00 0.00 5839739.79 661410.35 69°58'7.368 N 148°42'48.292 W Project Great Bear Project Site: Great Bear SECTION DETAILS Well: Plan Merak#1 Wellbore: Merak#1 ST1 Sec MD Inc Azi TVD +N/-S +EI-W DLeg TFace VSec Target Merak#1 ST1 WP16.0A 1 8850.00 9.00 315.00 8846.21 29.90 -53.56 0.00 0.00 59.01 2 8900.00 9.00 315.00 8895.80 35.43 -59.09 0.00 0.00 66.83 3 11599.99 90.00 315.00 10506.89 1369.27 -1392.93 3.00 0.00 1953.18 4 14599.99 90.00 315.00 10506.69 3490.59 -3514.26 0.00 0.00 4953.18 -1000 Vi West(-)/East(+)(1500 ft/in) +•=t -3750 -3000 -2250 -1500 -750 0 750 0- I j i 1 1 I I 11 l 1._.t....1....J....1.._1 i 1 I i i i i I I i I I I i t I i i 1000- 3750- -3750 • ``\' Merak#1 ST1 WP16.QA 2000- 3000 4-1/2" =3000 J1133/8" ! o c 3000- -2-2250- -2250 - a= o o i Lo Merak#1 WP16.0 r + c 4000- +1500-, -15001 _ _ cn p - .c _ Merak#1 Rig _ o O - 5000- Z 750- 7 -750 5' .c - d O - t CO - 9 5/8 'ti, - -al• 6000- 0- --•.' -0 _ Merak#1 Rig 13 3/8" _ H• 7000 1 3 KO8850.00'MD,8846.21'TVD -750- --750 I I I I I I I I I I I I I I I I i l i l i [ l i I I I I I I I I l l l rg Top HRZ ., " -3750 -3000 -2250 -1500 -750 0 750 ., 9 5/8" ' Start Dir 3°/100':8900'MD,8895.6'TVD West(-)/East(+)(1500 ft/in) 8000- Base HRZ '. -- Kuparuk C 9000- LCU' Miluveach Total Depth: 14599.99'MD,10506.69'TVD - Upper Kingak - End Dir :11599.99'MD,10506.69'TVD 10000- Lwr Kingak Base • • 4-1/2" -- Top Shublik- - --t 11000- Base Shubllk - - Ivishak Merak#1 WP16.0 Merak#1 ST1 WP16 OA 12000 -I I I I 1 1 I I i I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I t I -2000 -1000 0 1000 2000 3000 4000 5000 6000 7000 Vertical Section at 315.00°(2000 ft/in) HALLIBURTON Standard Proposal Report Database: EDM 2003.16 Single User Db Local Co-ordinate Reference: Well Plan Merak#1 Company: Great Bear Petroleum TVD Reference: Actual RKB @ 196.42ft(KBE@174.7+Actual@2 Project: Great Bear Project MD Reference: Actual RKB @ 196.42ft(KBE@174.7+Actual@2 Site: Great Bear North Reference: True Well: Plan Merak#1 Survey Calculation Method: Minimum Curvature Wellbore: Merak#1 ST1 Design: Merak#1 ST1 WP16.0A Project Great Bear Project Map System: US State Plane 1927(Exact solution) System Datum: Mean Sea Level Geo Datum: NAD 1927(NADCON CONUS) Using Well Reference Point Map Zone: Alaska Zone 04 Using geodetic scale factor Site Great Bear Site Position: Northing: 5,847,611.30ft Latitude: 69"59'23.898 N From: Map Easting: 665,578.34ft Longitude: 148`40'43.837 W Position Uncertainty: 0.00 ft Slot Radius: in Grid Convergence: 1.24 Well Plan Merak#1 Well Position +N/-S 0.00 ft Northing: 5,839,739.79 ft Latitude: 69°58'7.368 N +E/-W 0.00 ft Easting: 661,410.35 ft Longitude: 148`42'48.292 W Position Uncertainty 0.00 ft Wellhead Elevation: ft Ground Level: 174.70 ft Wellbore Merak#1 ST1 Magnetics Model Name Sample Date Declination Dip Angle Field Strength (°) (°) (nT) BGGM2012 8/31/2012 20.73 80.79 57,606 Design Merak#1 ST1 WP16.0A Audit Notes: Version: Phase: PLAN Tie On Depth: 8,850.00 Vertical Section: Depth From(TVD) +N/-S +E/-W Direction (ft) (ft) (ft) (°) 21.72 0.00 0.00 315.00 Plan Sections Measured Vertical TVD Dogleg Build Turn Depth Inclination Azimuth Depth System +N/-S +EI-W Rate Rate Rate Tool Face (ft) (°) (°) (ft) ft (ft) (ft) (°110oft) (°/10Oft) (°/100ft) (°) 8,850.00 9.00 315.00 8,846,21' 8,649.79 29.90 -53.56 0.00 0.00 0.00 0.00 8,900.00' 9.00 315.00 8,895.60 8,699.18 35.43 -59.09 0.00 0.00 0.00 0.00 11,599.99 90.00 315.00 10,506.69 10,310.27 1,369.27 -1,392.93 3.00 3.00 0.00 0.00 14,599.99 90.00 315.00 10,506.69 10,310.27 3,490.59 -3,514.26 0.00 0.00 0.00 0.00 9/4/2012 4::15:12PM Page 2 COMPASS 2003.16 Build 73 j - L.-I!, ,,, Standard Proposal Report Database: EDM 2003.16 Single User Db Local Co-ordinate Reference: Well Plan Merak#1 , Company: Great Bear Petroleum TVD Reference: Actual RKB @ 196.42ft(KBE@174.7+Actual@2 Project: Great Bear Project MD Reference: Actual RKB @ 196.42ft(KBE@174.7+Actual@2 Site: Great Bear North Reference: True Well: Plan Merak#1 Survey Calculation Method: Minimum Curvature , Wellbore: Merak#1 ST1 Design: Merak#1 ST1 WP16.0A Planned Survey Measured Vertical Map Map Depth Inclination Azimuth Depth TVDss +N/-S +E/-W Northing Easting DLS Vert Section (ft) (°) (°) (ft) ft (ft) (ft) (ft) (ft) 8,649.79 8,850.00 9.00 315.00 8,846.21 8,649.79 29.90 -53.56 5,839,768.55 661,356.18 0.00 59.01 KOP:8850.00'MD,8846.21'TVD 8,900.00 9.00 315.00 8,895.60 8,699.18 35.43 -59.09 5,839.773.96 661,350.53 0.00 66.83 Start Dir 3°1100':8900'MD,8895.6'TVD 8,918.04 9.54 315.00 8,913.40 8,716,98 37.48 -61.14 5,839,775.97 661,348.43 3.00 69.74 Top HRZ 9,000.00 12.00 315.00 8,993.91 8,797.49 48.31 -71.97 5,839,786.57 661,337.38 3.00 85.06 9,004.59 12.14 315.00 8,998.40 8,801.98 48.99 -72.65 5,839,787.23 661,336.69 3.00 86.01 Base HRZ 9,100.00 15.00 315.00 9,091,14 8,894.72 64.82 -88.48 5,839,802.72 661,320.53 3.00 108.40 9,141.81 16.25 315.00 9,131.40 8,934.98 72.78 -96.44 5,839,810.52 661,312.40 3.00 119.66 LCU-Kuparuk C 9,200.00 18.00 315.00 9,187.01 8,990.59 84.90 -108.56 5,839,822.37 661,300.03 3.00 136.80 9,220.42 18.61 315.00 9,206.40 9,009.98 89.43 -113.10 5,839,826.81 661,295.40 3.00 143.21 Miluveach 9,300.00 21.00 315.00 9,281.26 9,084.84 108.50 -132.16 5,839,845.47 661,275.94 3.00 170.17 9,400.00 24,00 315.00 9,373.64 9,177.22 135.56 -159.22 5,839,871.95 661,248.32 3.00 208.44 9,487.13 26.61 315.00 9,452.40 9,255.98 161.89 -185.55 5,839,897.72 661,221.44 3.00 245.68 Upper Kingak 9,500.00 27.00 315.00 9,463.89 9,267.47 165.99 -189.66 5,839,901.74 661,217.25 3.00 251.48 9,600.00 30.00 315.00 9,551.76 9,355.34 199.73 -223.39 5,839,934.75 661,182.81 3.00 299.19 9,700.00 33.00 315.00 9,637.01 9,440.59 236.67 -260.33 5,839,970.90 661,145.10 3.00 351.44 9,800.00 36.00 315.00 9,719.42 9,523.00 276.72 -300.38 5,840,010.09 661,104.22 3.00 408.07 9,900.00 39.00 315.00 9,798.74 9,602.32 319.76 -343.42 5,840,052.21 661,060.28 3.00 468.94 10,000.00 42.00 315.00 9,874.78 9,678.36 365.68 -389.34 5,840,097.15 661,013.41 3.00 533.88 10,100.00 45.00 315.00 9,947.30 9,750.88 414.35 -438.01 5,840,144.78 660,963.73 3.00 602.71 10,200.00 48.00 315.00 10,016.13 9,819.71 465.63 -489.29 5,840,194.96 660,911.38 3.00 675.24 10,300.00 51.00 315.00 10,081.07 9,884.65 519.40 -543.06 5,840,247.58 660,856.50 3.00 751,27 10,400.00 54.00 315.00 10,141.94 9,945.52 575.49 -599.15 5,840,302.47 660,799.24 3.00 830.59 10,500.00 57.00 315.00 10,198.57 10,002.15 633.76 -657.42 5,840,359.49 660,739.76 3.00 913.00 10,600.00 60.00 315.00 10,250.82 10,054.40 694.04 -717.70 5,840,418.49 660,678.22 3.00 998.25 10,700.00 63.00 315.00 10,298.53 10,102.11 756.17 -779.84 5,840,479.29 660,614.79 3.00 1,086.12 10,800.00 66.00 315.00 10,341.57 10,145.15 819.99 -843.65 5,840,541.74 660,549.65 3.00 1,176.37 10,900.00 69.00 315.00 10,379.84 10,183.42 885.31 -908.97 5,840,605.67 660,482.97 3.00 1,268.75 11,000.00 72.00 315.00 10,413.21 10,216.79 951.96 -975.62 5,840,670.89 660,414.94 3.00 1,363.00 11,100.00 75.00 315.00 10,441.61 10,245.19 1,019.75 -1,043.41 5,840,737.23 660,345.73 3.00 1,458.87 11,200.00 78.00 315.00 10,464.95 10,268.53 1,088.50 -1,112.16 5,840,804.51 660,275.56 3.00 1,556.10 11,207.00 78.21 315.00 10,466.40 10,269.98 1,093.34 -1,117.00 5,840,809.25 660,270.61 3.00 1,562.95 7" 11,207.02 78.21 315.00 10,466.40 10,269.98 1,093.36 -1,117.02 5,840,809.26 660,270.60 3.00 1,562.97 Lwr Kingak Base-Top Shublik 11,300.00 81.00 315.00 10,483.17 10,286.75 1,158.02 -1,181.68 5,840,872.54 660,204.59 3,00 1,654.41 11,400.00 84.00 315.00 10,496.22 10,299.80 1,228.11 -1.251.78 5,840,941.14 660,133.03 3.00 1,753.55 11,500.00 87.00 315.00 10,504.07 10,307.65 1,298.60 -1,322.26 5,841,010.12 660,061.08 3.00 1,853.23 9/4/2012 4.15:12PM Page 3 COMPASS 2003.16 Build 73 HALLIBURTO SJ Standard Proposal Report Database: EDM 2003.16 Single User Db Local Co-ordinate Reference: Well Plan Merak#1 Company: Great Bear Petroleum TVD Reference: Actual RKB @ 196.42ft(KBE©174.7+Actual@2 Project: Great Bear Project MD Reference: Actual RKB @ 196.42ft(KBE@174.7+Actual@2 Site: Great Bear North Reference: True Well: Plan Merak#1 Survey Calculation Method: Minimum Curvature Wellbore: Merak#1 ST1 Design: Merak#1 ST1 WP16.0A Planned Survey Measured Vertical Map Map Depth Inclination Azimuth Depth TVDss +N/-S +E/-W Northing Easting DLS Vert Section (ft) e) (0) (ft) ft (ft) (ft) (ft) (ft) 10,310.27 11,599.99 90.00 315.00 10,506.69 10,310.27 1,369.27 -1,392.93 5,841,079.28 659,988.94 3.00 1,953.17 End Dir :11599.99'MD,10506.69'TVD 11,600.00 90.00 315.00 10,506.69 10,310.27 1,369.28 -1,392.94 5,841,079.28`'' 659,988.94 1.38 1,953.18 11,700.00 90.00 315.00 10,506.69 10,310.27 1,439.99 -1,463.65 5,841,148.48 659,916.75 0.00 2,053.18 11,800.00 90.00 315.00 10,506.69 10,310.27 1,510.70 -1,534.36 5,841,217.68 659,844.57 0.00 2,153.18 11,900.00 90.00 315.00 10,506.69 10,310.27 1,581.41 -1,605.07 5,841,286.88 659,772.39 0.00 2,253.18 12,000.00 90.00 315.00 10,506.69 10,310.27 1,652.12 -1,675.78 5,841,356.08 659,700.21 0.00 2,353.18 12,100.00 90.00 315.00 10,506.69 10,310.27 1,722.83 -1,746.49 5,841.425.27 659,628.03 0.00 2,453.18 12,200.00 90.00 315.00 10,506.69 10,310.27 1,793.54 -1,817.20 5,841,494.47 659,555.85 0.00 2,553.18 12,300.00 90.00 315.00 10,506.69 10,310.27 1,864.25 -1,887.91 5,841,563.67 659,483.66 0.00 2,653.18 12,400.00 90.00 315.00 10,506.69 10,310.27 1,934.96 -1.958.62 5,841,632.87 659,411.48 0.00 2,753.18 12,500.00 90.00 315.00 10,506.69 10,310.27 2,005.67 -2,029.33 5,841,702.07 659,339.30 0.00 2,853.18 12,600.00 90.00 315.00 10,506.69 10,310.27 2,076.38 -2,100.05 5,841,771.27 659,267.12 0.00 2,953.18 12,700.00 90.00 315.00 10,506.69 10,310.27 2,147.09 -2,170.76 5,841.840.46 659,194.94 0.00 3,053.18 12,800.00 90.00 315.00 10,506.69 10,310.27 2,217.81 -2,241.47 5,841,909.66 659,122.76 0.00 3,153.18 12,900.00 90.00 315.00 10,506.69 10,310.27 2,288.52 -2.312.18 5,841,978.86 659,050.57 0.00 3,253.18 13,000.00 90.00 315.00 10,506.69 10,310.27 2.359.23 -2.382.89 5,842,048.06 658,978.39 0.00 3,353.18 13,100.00 90.00 315.00 10,506.69 10,310.27 2,429.94 -2,453.60 5,842,117.26 658,906.21 0.00 3,453.18 13,200.00 90.00 315.00 10,506.69 10,310.27 2,500.65 -2,524.31 5,842,186.46 658,834.03 0.00 3,553.18 13,300.00 90.00 315.00 10,506.69 10,310.27 2,571.36 -2,595.02 5,842,255.65 658,761.85 0.00 3,653.18 13,400.00 90.00 315.00 10,506.69 10,310.27 2,642.07 -2,665.73 5,842,324.85 658,689.67 0.00 3,753.18 13,500.00 90.00 315.00 10,506.69 10,310.27 2,712.78 -2,736.44 5,842,394.05 658,617.49 0.00 3,853.18 13,600.00 90.00 315.00 10,506.69 10,310.27 2,783.49 -2,807.15 5,842,463.25 658,545.30 0.00 3,953.18 13,700.00 90.00 315.00 10,506.69 10,310.27 2,854.20 -2,877.86 5,842,532.45 658,473.12 0.00 4,053.18 13,800.00 90.00 315.00 10,506.69 10,310.27 2,924.91 -2,948.57 5,842,601.65 658,400.94 0.00 4,153.18 13,900.00 90.00 315.00 10,506.69 10,310.27 2,995.62 -3,019.28 5,842,670.84 658,328.76 0.00 4,253.18 14,000.00 90.00 315.00 10,506.69 10,310.27 3,066.33 -3,089.99 5,842,740.04 658,256.58 0.00 4,353.18 14,100.00 90.00 315.00 10,506.69 10,310.27 3,137.04 -3,160.71 5,842,809.24 658,184.40 0.00 4,453.18 14,200.00 90.00 315.00 10,506.69 10,310.27 3,207.75 -3,231.42 5,842,878.44 658,112.21 0.00 4,553.18 14,300.00 90.00 315.00 10,506.69 10,310.27 3,278.47 -3,302.13 5,842,947.64 658,040.03 0.00 4,653.18 14,400.00 90.00 315.00 10,506.69 10,310.27 3,349.18 -3,372.84 5,843,016.84 657,967.85 0.00 4,753.18 14,500.00 90.00 315.00 10,506.69 10,310.27 3,419.89 -3,443.55 5,843,086.04 657,895.67 0.00 4,853.18 14,599.99 90.00 315.00 10,506.69 .10,310.27 3,490.59 .-3,514.25 , 5,843,155.23 657,823.50 0.00 4,953.17 Total Depth:14599.99'MD,10506.69'TVD-4-112" Casing Points Measured Vertical Casing Hole Depth Depth Diameter Diameter (ft) (ft) Name (in) (in) 14,599.99 10,506.69 4-1/2" 4.500 6.125 11,207.00 10,466.40 7" 7.000 8.500 8,800.00 8,796.83 9 5/8" 9.625 12.250 2,447.00 2,446.79 13 3/8" 13.375 17.500 9/4/2012 4:15:12PM Page 4 COMPASS 2003.16 Build 73 HALLIBURTON Standard Proposal Report Database: EDM 2003.16 Single User Db Local Co-ordinate Reference: Well Plan Merak#1 Company: Great Bear Petroleum TVD Reference: Actual RKB @ 196.42ft(KBE@174.7+Actual@2 Project: Great Bear Project MD Reference: Actual RKB @ 196.42ft(KBE@174.7+Actual@2 Site: Great Bear North Reference: True Well: Plan Merak#1 Survey Calculation Method: Minimum Curvature Wellbore: Merak#1 ST1 Design: Merak#1 ST1 WP16.0A Formations Measured Vertical Vertical Dip Depth Depth Depth SS Dip Direction (ft) (ft) ft Name Lithology (o) (0) 11,207.02 10.466.40 Lwr Kingak Base 9,004.59 8.998.40 Base HRZ 971.54 971.40 Permafrost 5,856.94 5,856.40 Upper Schrader Bluff 9,141.81 9,131.40 LCU 10,618.40 Ivishak 9,487.13 9,452.40 Upper Kingak 9,141.81 9,131.40 Kuparuk C 11,207.02 10,466.40 Top Shublik 9,220.42 9,206.40 Miluveach 10,585.40 Base Shublik 8,918.04 8,913.40 Top HRZ 7,166.06 7.165.40 Campanian Flooding Surface 6,522.99 6,522.40 Lower Canning 8,513.30 8,512.40 MCU Plan Annotations Measured Vertical Local Coordinates Depth Depth +N!-S +E/-W (ft) (ft) (ft) (ft) Comment 8,850.00 8,846.21 29.90 -53.56 KOP:8850.00'MD,8846.21'TVD 8,900.00 8,895.60 35.43 -59.09 Start Dir 3°/100':8900'MD,8895.6'TVD 11,599.99 10,506.69 1,369.27 -1,392.93 End Dir : 11599.99'MD, 10506.69'TVD 14,599.99 10,506.69 3,490.59 -3,514.25 Total Depth: 14599.99'MD,10506.69'TVD 9/4/2012 4:15.12PM Page 5 COMPASS 2003.16 Build 73 Great Bear Petroleum Great Bear Project reat Bear Plan Merak #1 Merak #1 ST1 Merak #1 ST1 WP16.OA Anticollision Summary Report 04 September, 2012 Anticollision Summary Report Company: Great Bear Petroleum Local Co-ordinate Reference: Well Plan Merak#1 Project: Great Bear Project TVD Reference: Actual RKB @ 196.42ft(KBE@174.7+Actual@ Reference Site: Great Bear MD Reference: Actual RKB @ 196.42ft(KBE@174.7+Actual@ Site Error: O.00ft North Reference: True Reference Well: Plan Merak#1 Survey Calculation Method: Minimum Curvature Well Error: 0.00ft Output errors are at 2.00 sigma Reference Wellbore Merak#1 ST1 Database: EDM 2003.16 Single User Db Reference Design: Merak#1 ST1 WP16.0A Offset TVD Reference: Offset Datum Reference Merak#1 ST1 WP16.OA Filter type: GLOBAL FILTER APPLIED:All wellpaths within 200'+100/1000 of refers Interpolation Method: MD Interval 25.00ft Error Model: ISCWSA Depth Range: Unlimited Scan Method: Tray.Cylinder North Results Limited by: Maximum center-center distance of 1,657,83ft Error Surface: Elliptical Conic Warning Levels Evaluated at: 2.00 Sigma Survey Tool Program Date 9/4/2012 From To (ft) (ft) Survey(Wellbore) Tool Name Description 205.22 659.01 Merak#1 Rig Surveys(MWD_Interp+Az) MWD_Interp Azi Fixed:v2:standard dec with interpolated azimuth 755.48 2,416.13 Merak#1 Rig Surveys(MWD+sag)(Merak MWD+sag Fixed:v2:standard declination+sag 2,476.15 7,166.22 Merak#1 Rig Surveys (MWD+sag)(Mera MWD+sag Fixed:v2:standard declination+sag 7,166.22 8,800.00 Merak#1 WP16.0(Merak#1) MWD+sag Fixed:u2:standard declination+sag 8,800.00 8,850.00 Merak#1 WP16.0(Merak#1) MWD+sag Fixed:v2:standard declination+sag 8,850.00 11,207.00 Merak#1 ST1 WP16.0A(Merak#1 ST1) MWD+sag Fixed:v2:standard declination+sag 11,207.00 14,599.99 Merak#1 ST1 WP16.OA(Merak#1 ST1) MWD+sag Fixed:v2:standard declination+sag Summary Reference Offset Distance Measured Measured Between Between Site Name Depth Depth Centres Ellipses Separation Offset Well-Wellbore-Design (ft) (ft) (ft) (ft) Factor Warning Great Bear Plan Merak#1 -Merak#1 -Merak#1 Rig 7,175.00 7,175.00 0.00 -0.94 0.001 Stop Drilling CF< 1.0,Cr Plan Merak#1 -Merak#1 -Merak#1 Rig 7,200.00 7,200.00 0.01 -1.02 0.011 Stop Drilling CF<1.0,Et Plan Merak#1 -Merak#1-Merak#1 WP16.0 8,900.00 8,900.00 0.00 -0.75 0.000 Stop Drilling CF<1.0,Cr Plan Merak#1 -Merak 1A(lateral)-Merak 1A 80 DLS W 9,986.27 10,329.80 701.77 685.60 43.408 CC Plan Merak#1 -Merak 1A(lateral)-Merak 1A 8°DLS W 10,000.00 10.350.00 715.43 685.54 23.935 ES,SF CC-Min centre to center distance or covergent point,SF-min separation factor.ES-min ellipse separation 9/4/2012 4:14:19PM Page 2 COMPASS 2003.16 Build 73 Anticollision Summary Report Company: Great Bear Petroleum Local Co-ordinate Reference: Well Plan Merak#1 Project: Great Bear Project TVD Reference: Actual RKB @ 196.42ft(KBE@174.7+Actual@ Reference Site: Great Bear MD Reference: Actual RKB @ 196.42ft(KBE@174.7+Actual@ Site Error: 0.00ft North Reference: True Reference Well: Plan Merak#1 Survey Calculation Method: Minimum Curvature Well Error: 0.00ft Output errors are at 2.00 sigma Reference Wellbore Merak#1 ST1 Database: EDM 2003.16 Single User Db Reference Design: Merak#1 ST1 WP16.0A Offset TVD Reference: Offset Datum Reference Depths are relative to Actual RKB @ 196.42ft(KBE@174.7-'Coordinates are relative to:Plan Merak#1 Offset Depths are relative to Offset Datum Coordinate System is US State Plane 1927(Exact solution),Alaska Zone 04 Central Meridian is 150°0'0.000 W° Grid Convergence at Surface is: 1.21° Ladder Plot I I i 1 1600 • I i i I I i i I I 1 i I I I I I 1 I I 1200 1 1 1 I 1 1 I 1 I I I C f i 1 I I I J -J - - --J-- -- _ 091 Qq� 1 1 1 I I II I 1 1 I I 1 1 E 800 1 1 1 I I I p 47 1 I I $ I b i i I 1 I I 1 1 I I I • i I I I I I i 1 I I I I 400 i i I I I I i I I 1 I I I I 1 FJ 1 I I 1 I I I i i RJ I I I 1 I I F 0 2000 4000 6000 8000 10000 12000 Measured Depth LEGEND PIan Merak N1,Merak N1,Merak N1Rig VO $ PIan Merak N1,Merak N1,MerakN1WP16.0VV -¢' PkanMeak✓a1,Merdd,3 j,Merak1A8°DLSVUP: CC-Min centre to center distance or covergent point,SF-min separation factor,ES-min ellipse separation 9/4/2012 4:14:19PM Page 3 COMPASS 2003.16 Build 73 Merak # 1 �� Proposed Wellbore Diagram 1j:4 20" Conductor @ 93' % Port Collar @ 500' 41 iia *. o II Type P ES Stage Tool 13 - 3/8" CasingA w/ Packer @ — 2,400' L- 80, 68lbs /ft, BTC 4,. TD @ 2,441' i 4 I4-1/2" Tubing —41---- P-110, 13.5 lbs /ft, ST- L Top of 7" Liner 280' Above 9-5/5' Shoe 41 II 9 - 5/8" Casing L- 80, 47 lbs /ft, BTC A 4-1/2" Liner 8,736' MD /8,731' TVD `" P-110, 13.5 lbs /ft, HY 521 y 7" Liner (Top Shublik) «. t P - 110, 29Ibs /ft, BTC - M 1, ` . , e.....4so 8-1/2" Hole _No— : Merak 11 .2 4 ° ton , 112n0' (150' Below Base Shublik) DRAWN BY: A. MICI REV: 04 SEP 2012 n to-C4-4— l To: Alaska Oil and Gas Conservation Commission Re: Managed Pressure Drilling—Great Bear Petroleum Sir: We are proposing to rig up a Managed Pressure Drilling(MPD)equipment package on Nabors 105E, currently operating for Great Bear Petroleum, and we are requesting information regarding regulations specifically applicable to adding equipment of this nature to existing rig systems. A summary of MPD operations, equipment required, and tie-in points to existing rig systems: Operations&tie-in points—The MPD system is used to manage bottomhole pressures(BHP) by pressurizing the annulus at the surface. This is accomplished by providing a seal around the drill pipe by utilizing a rotating control device (RCD). A flow tee is attached to the outlet on the RCD which allows us to divert flow directly to the shale shakers, or to the MPD auto-choke system. Each of the legs off the tee is isolated via a 2K WP pneumatic wedge valve. Annulus pressure is achieved by choking down the annular flow by means of computer-controlled chokes. Downstream of the auto-chokes,the fluid is returned to the active pit system on the rig via a 4" 1,300 psi WP line which ties in to the rig flow line. This line is isolated via a 4" 150 psi WP butterfly valve. When making a connection during normal drilling operations, annular flow stops,which reduces BHP due to annular friction loss. With our equipment in operation,we maintain the desired BHP by means of diverting flow from the drill string to our MPD auto-choke via a Rig Pump Diverter manifold (RPD). See attached procedure for connection procedure. Upon completion of the connection,flow is diverted from the RPD back to the drill string and drilling resumes. The connection procedure deviates from normal operations in that the rig pump is not shut down during the connection. In order to receive flow from the mud pumps to the RPD, a tie-in to the mud line is required. On Nabors 105E, an existing 2" Fig. 1502 outlet is available for the tie-in. We propose to isolate the rig mud line via a 2" 10K Lo-torq manually operated valve. A tie-in to the rig standpipe is also required for de-pressurizing the standpipe prior to a connection, as well as re-pressurizing the standpipe once the connection has been made. A 2" Fig. 1502 tie-in is also available on the standpipe,and will be isolated via a 2" 10K Lo-torqmanually operated valve as well. Additionally, we propose to tee off our primary flowline and connect a 2" 10K line to an existing 2" Fig. 1502 tie-in point on the rig choke manifold. This line will be isolated via a 2" 10K Lo-torq valve. The purpose of this line is to enable us to use the rig choke to maintain BHP in the event we have a system failure within the MPD auto-choke. The tie-in to the AMGS(downstream of valve U-11 on attached piping diagram) has been deemed to be impractical due to requiring a new AMGS inlet line to be fabricated in order to make the tie-in. This line was originally intended to divert return flow from the shale shakers to the AMGS in the event an influx is allowed into the wellbore. An influx, although possible, is unlikely if the system maintains a correctly- engineered desired BHP. However, if an influx is present in the wellbore,the MPD system is able to detect it prior to its reaching surface and we plan to shut the well in via the annular BOP and circulate it out via the rig choke/AMGS as we would in conventional drilling operations. Equipment required: RCD—13 5/8—5K Bottom flange—2K psi Working Pressure (WP) Flow tee—7 1/16—3K flanged --2K WP Wedge valve(s)—7 1/16—3K flanged—2K WP Primary flowline to MPD auto-choke—4"—6K WP w/4" Fig. 602 welded hammer unions . RPD-- 2" 10K piping w/2" 10K Lo-torq pneumatic valves(can be operated either locally or remotely via computer commands). MPD auto-choke—4"—5K WP pneumatic/manual gate valves(local or remote). 3X hydraulic chokes (3" 2„ 2"). 2" piping—2" 10K WP w/welded 2" Fig 1502 hammer unions. 4" liquid return piping—4" 1,300 psi WP w/welded 4" Fig. 206 hammer unions. Any information regarding inspections/testing of the above system, as well as any concerns you may have will be greatly appreciated. George Carpenter MPD Supervisor Halliburton—Sperry Drilling 713-876-4863 e-mail—George.carpenter@halliburton.com Of I N I A _I W N C A C • C D ;2i rrl x O c O D nx x n U D T A m O: O 1,1 X; x r i < P C) m • m A = QS) 01 -, oo 1--. l O rn -c xm e2 :8ge -@ — Ii u 21502 I 0 A m .— It it a 4 .� 2 F 6 1,1 �Om co Z. O rR , • m 2 o iIoD nm < - e , m cxz yy4e 9 4 FA 7-1 A � m_ z 33 o co le o 0 v (, 11111ii�il I I x o 0� III —-- O 5. O J gz "' 110 Rig Flow Line A N p ti OK-DI' O o� i� v <"i 2,---.', .O.' rri l K1 z N_ x A a p n 19p 08 A S AyN ; i x —? b. mo O % > v ; gl IR. a1- / w o . OO I-. `O Imo " m OCi io m ti S 0 _, m € F N - �� It € - 2 my FFF �9 0"y2 l a m ii o <m Z N a I-ng �Nmi+E ms2 ^'7 .Z7 � rn �.. _ — 57 R u{ i Pyr O�C7 `� ;03 C g oE8 m o m p _ O:vll ll®�,�� _ i�c A-m 2 z ❑ Vel.-. -V4—❑ 22 7 >� 0 �n S 0 '' F, �� N ►� fro°]_-_I-vp4 ❑,; F yo O I® 7O w� r 5. (0 E — ;< m ; :O L la — me tO o o so ®, 9, (0 15 1 N ; gym O N N- yy_= Am - � _. � in gam! o o -172 .6 O C) I. CI � To Rig Flow Line .C.' 6 6) c� I o * T m, o s 24 O6 250 psi El, Sm (IO 4.026") Z 'ElZ g O o OI • C o ps — _ 6 3 5 m T' i c g a "' e I P z C)) m g5 - - c a - c_% _ _ m ,\ 5,, O N = SG Zm \ ... Q Qi a ` m - - J � 2 0 m N a, I 0 I A I w N MPD-Connection with RPU(rev1.7) HALLIBURTON 1 Reviewed 1 Reviewed 1 Issued For Internal Review Rev. Date Reason for Issue: Prepared Checked Approved Approved 1.7 ORIGINATOR CLIENT CLIENT CONTRACT NO. Great Bear Petroleum PROJECT SITE/LOCATION: MERAK#1 DOCUMENT TITLE MPD -Connection with RPD DOCUMENT NO. 2 Project/ Originator Discipline Document Sequence Revision Entity ref. code code type no. 1 of 5 MPD-Connection with RPD(rev1.7) ACTIVITY: Drilling—CONNECTION USING MPD RPD Prepared by Mohamed Sati/Mike Pool 11-09-10 Checked by George Carpenter 09-11-12 Approved by Distribution: Drilling supervisor,Drilling Engineer,Tool pusher,Driller,Derrick man,Mud logger, DD,MWD operator,Mud eng,MPD Supervisor,RCD Operator,MPD Operator,Extra copy Abbreviations: MPD=Managed Pressure Drilling. PTW=Permit To Work. TBT=Tool Box Talk. BOP=Blow Out Preventer. MGS=Mud Gas Separator. PSV=Pressure Safety Valve(Pressure Relief Valve). WHP=Well Head Pressure. BHP=Bottom Hole Pressure P&ID=Process and Instrumentation Diagram. HCR=High Close Ratio valves hydraulically operated on the BOP stack. RCD=Rotating control Device. OBM=Oil Based Mud. WBM=Water Based Mud. PPE=Personal Protective Equipment. MSDS=Material Safety Data Sheets. DP=Differential Pressure. NRVs=Non Return Valves RPD=Rig pump diverter FOSV=Full Opening Safety Valve(sometimes referred to as TIW or Pipe Cock Valve). TIW=Texas Iron Work HMI=Human Machine Interface Objective/Goal: The purpose of this procedure is to detail the connection requirements for MPD operations using the Geobalance MPD system and Rig Pump Diverter system. Well status: 1. The MPD operations have commenced,the well is in a dynamic condition with a hydrostatic fluid column that is statically underbalanced and applied surface back pressure is required to maintain a BHP that is above either the pore pressure or the collapse pressure and below the fracture gradient. 2. Finish drilling a stand and ready to make a connection. 2 of 5 MPD-Connection with RPr,(rev 1.7) HES&Q: The Driller is the focal point of communication for MPD operations and is to be informed of all changes in well conditions and equipment conditions.The driller has the responsibility of communicating with the drilling supervision team. The addition of the MPD equipment does not interfere with the drillers ability to shut in the well conventionally and the procedures that are normally used remain intact. Well control events as defined by Great Bear Petroleum and agreed upon between Sperry and Nabors Drilling will result in the conventional BOP system being closed and well kill circulations being performed through the conventional well control choke lines,chokes,choke manifold and AMGS. It is not envisaged that any circumstances will arise that shall justify handling a well control event beyond the predefined limits through the MPD system. Well control events are serious matters and minor kick events can quickly escalate into major events. The main BOP system has been designed and proven to be capable of handling any event that may arise. The well control procedures will dictate when a well control event has occurred and at what point to switch from MPD mode to well control. As such it is an important part of our safety policy for MPD that well control equipment is for well control, MPD equipment is for normal operations Operational Parameters: Predefined operational parameters will be issued for the hole section. 3 of 5 MPD-Connection‘with RPD(rev1.7) Connection Step Procedure: Seq. Operations: Simultaneous activities/ Comments: no: Notes: 1. Driller—Inform MPD Prior to connection,Back ream Supervisor that the stand 1/2 stand observing for has been drilled down. indications of over-pull and stand The pipe is placed In- pipe pressure increase,Driller to slips. record torque&drag readings as per Great Bear/Nabors procedures. 2. Driller to adjust pump MPD supervisor/Operator to Good communication between rate as per MPD ensure the flow rates are MPD crew and Rig crew. supervisor within the controllable limits recommendation of the MPD choke. MPD supervisor to line MPD operator should have up the flow diversion Cv curves calculated with the path from rig pump to controllable area of WHP MPD primary flow line and pump rate to be used. 3. MPD crew to divert Communication between flow from rig pump to MPD supervisor and rig crew MPD primary flow line is essential so that the via RPD system: connection is done safely and smoothly Open valve"S5" Driller to notify MPD supervisor that he is ready to divert flow MPD operator start diversion 4. MPD crew to confirm MPD operator to notify Ensure SPP read zero psi!!! WHP and SPP is equal Driller of closing SP valve. Close valve"S8" 5. MPD crew and rig crew MPD supervisor visually MPD DAS Operator to notify to Isolate and bleed off confirms no flow @trip tank MPD supervisor when automatic SPP. &to inform Driller that SPP control has bled off all pressure has completely bled off and from standpipe. it's safe to break connection 6. Driller to make MPD choke operator to Flow rate from rig pump is major connection as per continue to monitor annular factor in keeping WHP pressure standard procedure. pressure to ensure there is no constant. Driller to inform MPD change. operator if any rate interruption is going to take place"swap pumps, leakage at pump,lines etc" In case of rig pump failure: switch to surface pressure control and try to maintain the last set pressure by trapping pressure with the chokes. 4 of 5 MPD-Connection with RPL(rev1.7) Seq. Operations: Simultaneous activities/ Comments: no: Notes: 7. Driller to inform MPD MPD supervisor to line up supervisor that valve for post connection connection is made. operation. 8. MPD supervisor to Driller to remain in in slips Note: Equalizing SPP will fill up equalize SPP with RPD until S8 is opened. the SP and the new stand which flow path pressure: will help to smooth transition from RPD flow path to normal MPD supervisor to drilling flow path,this will insure inform Driller that SP stable WHP and WHP are equal MPD supervisor notify Bleed trapped pressure at RPD Driller to open"S8" line to the rig tank Open: V5 9. Driller to confirm MPD engineer to monitor Flow rate from rig pump is major reaching drilling WHP and confirm MPD factor in keeping WHP pressure parameters system is stable and drilling constant. Driller to inform MPD operation can start operator if any rate interruption is about to take place"swap pumps, leakage at pump,lines etc". Good communication between MPD crew 5 of 5 TRANSMITTAL LETTER CHECKLIST WELL NAME ` / iirtk PTD# ?— / ?-- /O ' Development Service `� Exploratory Stratigraphic Test Non-Conventional Well ,5'44,6_ FIELD: X..../?7C-)-7 C POOL: I Check Box for Appropriate Letter/Paragraphs to be Included in Transmittal Letter CHECK ADD-ONS WHAT (OPTIONS) TEXT FOR APPROVAL LETTER APPLIES MULTI LATERAL The permit is for a new wellbore segment of existing well (If last two digits in Permit No. ,API No. 50- - - API number are between 60-69) Production should continue to be reported as a function of the original API number stated above. PILOT HOLE In accordance with 20 AAC 25.005(f), all records, data and logs acquired for the pil t hole must be clearly differentiated in both well name ( M-e- at, / PH) and API number (50- 2-33 - '7p) from records, data and logs acquired for well . SPACING The permit is approved subject to full compliance with 20 AAC EXCEPTION 25.055. Approval to produce/inject is contingent upon issuance of a conservation order approving a spacing exception. assumes the liability of any protest to the spacing exception that may occur. DRY DITCH All dry ditch sample sets submitted to the Commission must be in SAMPLE no greater than 30' sample intervals from below the permafrost or from where samples are first caught and 10' sample intervals through target zones. Non-Conventional Please note the following special condition of this permit: Well production or production testing of coal bed methane is not allowed for (name of well) until after (Company Name) has designed and implemented a water well testing program to provide baseline data on water quality and quantity. (Company Name)must contact the Commission to obtain advance approval of such water well testing program. Rev:9/09/2011 so N cn o N C a a) d OO. cn N N 0 • o @ O , t U ca) Q * d C 5,2 3' ac) � u�mi m'3 2 C, y, , . E. To t m o y 3: o, o c a c=i> a E' L 0. o m X c L. a) o: 1C1: 0 m, O: °� O m �: Q L, '3, 3' a o.y o y, O o: c, ,o -a a o 0, 3, 2' _ 0 E o2 3' m, a) ,o ,c O OE = c Lam. , , , , - a m, c oas : U i aw .CA U. co, ° a), V. O O, �: O O a C C y, a) co3 °' co • ai 0 >, o, a, '° C, y m a) - m c L, m O' co. is 2, Q•„ m, c, Q .3 U a) L, ,c) c E o, m, a, o, , m, co, C, p o 3 O : N, E Y ) C; O. 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RECEIVED SEP 0 6 2012 4 AOGCC Great Bear Petroleum Operating LLC A New Direction for the Last Frontier Phone: (907) 868-8070, Fax: (907) 868-3887 September 7, 2012 Ms. Cathy Foerster, Chair Alaska Oil and Gas Conservation Commission 333 West 7th Ave., Suite 100 Anchorage, Alaska 99501 RE: Application for Sundry Approval Change of Approved Program: Merak #1 (PTD No. 212-101) Dear Ms. Foerster, Great Bear Petroleum Operating LLC hereby applies for Sundry Approval to change the approved Permit to Drill for the Merak #1, a new oil exploration well located onshore near the Dalton Highway south of Deadhorse, Alaska. A Permit to Drill for the Merak #1 was issued by the AOGCC on August 7, 2012 and drilling commenced there on August 21. Since that time, events have shown the desirability of making two significant changes to the approved program. 0 First, ongoing analyses of the cores obtained in the previously drilled Alcor #1 indicate a new optimal azimuth for the planned horizontal sidetrack in the Merak #1. ill' I Consequently, a new directional plan has been designed and is submitted here for fit,)' � " approval. ��� I,� 1.1/ Secondly, whereas the original well plan called for an intermediate 7" casing string and a 1' 4-1/2" liner, both of which would experience maximum treating pressures during hydraulic fracturing operations, the proposed new plan calls for a 7" drilling liner hung in the 9-5/8" intermediate casing and the 4-1/2" liner, after being hung in the 7" liner, will be tied back to surface. In this configuration, only the 4-1/2" string will experience fracture treating pressures. A revised wellbore schematic is attached to illustrate this. Bringing the Unconventional Resource Play to Alaska September 7, 2012 Page 2 of 2 If you have any questions or require additional information, please contact me at (907) 868-8070 or (281) 828-0389. Sincerely, Great Bear Petroleum Operating LLC Clark Clement, Chief Operating Officer Attachments Bringing the Unconventional Resource Play to Alaska , ik S Fav FP Fo STATE OF ALASKA �� 20,2 ALASKA OIL AND GAS CONSERVATION COMMISSION APPLICATION FOR SUNDRY APPROVALS SCC 20 AAC 25.280 1.Type of Request Abandon❑ Plug for Redrill❑ Perforate New Pool❑ Repair Well❑ Change Approved Program 0 . Suspend❑ Plug Perforations❑ Perforate❑ Pull Tubing❑ Time Extension❑ Operations Shutdown❑ Re-enter Susp.Well❑ Stimulate❑ Alter Casing❑ Oti- : ❑ 2.Operator Name: 4.Current Well Class. 5,P tir.to Drill Number Great Bear Petroleum Operating LLC Development ❑ Exploratory 0 -, ,!` 212-101 3.Address: • I' •PI Number: Stratigraphic ❑ Service ❑ 601 West 5th Avenue,Suite 505,Anchorage,Alaska 99501 :11" r 50-223-20027-00-00 - 7.If perforating,closest approach in pool(s)opened by this operation to nearest 8.Well Name an property line where ownership or landownership changes. Merak#1 - Spacing Exception Required? Yes ❑ No 0 9.Property Designation(Lease Number): 10.Field/Pool(s): ADL 391706 ' Ex,,,Pon 11 PRESENT WELL CONDITION SUMMARY Total Depth MD(ft): Total Depth TVD(ft): Effective Depth MD(ft). Effective De ► (ft). jrte gs asured): Junk(measured). s 8,750' 8,745' 8,750' 4it'• None None Casing Length Size Burst Collapse Structural • Conductor 94' 20" 1 117' N/A N/A Surface 2,418' 9.625" 2,44 2,441' 5,750 psi 3,090 psi Intermediate Production Liner Perforation Depth MD(ft): Perforation Depth TVD(ft). bin. •ze: Tubing Grade: Tubing MD(ft). N/A N/A A N/A N/A Packers and SSSV Type. N/A • \ P kers and SSSV MD(ft)and TVD(ft). 12.Attachments: Description Summary of- Cr• Q 13.Well Class after proposed work: Detailed Operations Program CI BOP Ske r I D Exploratory 0 . Development ❑ Service ❑ 14.Estimated Date for 15.Well Status after proposed work: 9/1.4 2042 Commencing Operations Oil 0 - Gas ❑ WDSPL ❑ Suspended ❑ 16.Verbal Approval. Date WINJ ❑ GINJ ❑ WAG ❑ Abandoned ❑ Commission Representative. GSTOR ❑ SPLUG ❑ 17.I hereby certify that the foregoing is true- d correct to the best of my knowledge. Contact Bill Penrose 907-264-6114 Printed Name Clark lement Title /' 5//"-- J/!� Chief Operating Officer Signature ` Phone / Date 1,7 907-868-8070 COMMISSION USE ONLY Conditions of approval. Notify C. mission so that a representative may witness Sundry Number ?j I'1 — '23...(—VPlug Integrity ❑ BOP Test ❑ Mechanical Integrity Test ❑ Location Clearance ❑ O, Other Subsequent Form 'egwred: APPROVED BY Approved by: COMMISSIONER THE COMMISSION Date. Form 10-403 Revised 1/2010 ORIGINAL Sub d m D ph ate Great Bear Petroleum Great Bear Project Great Bear Plan Merak #1 ;') Merak #1 ST1 7 c/by/rA, Plan: Merak #1 ST1 WP16.0A .04 / IJ ,J f6; 1,y)'‘) Standard Proposal Report), ` 7 tld . 04 September, 2012 - \Oz tY) tc? 4-pV' nk / IT It HALLIBURT©N mainemommummimillims Sperry Drilling Services HAL_ BURTON ERENCE INFORMATION Co-ordinate(N/E)Re,erence: Well Plan Merak#1,True North Vertical(ND)Reference: Actual RKB @ 196.42f1(KBE@174.7+Actual@21.72) Measured Depth Reference: Actual RKB @ 196.42ft(KBE@174.7+Actual@21.72) Sperry Drilling Calculation Method: Minimum Curvature Great Bear Petroleum LLC CASING DETAILS SURVEY PROGRAM ND MD Name Size Date:2012-09-04T00:00:00 Validated:Yes Version: 2446.79 2447.00 13 3/8" 13.375 8796.83 8800.00 9 5/8' 9.625 Depth From Depth To Survey/Plan Tool 10466.40 11207.00 7" 7.000 205.22 659.01 Merak#1 Rig Surveys(MWD_Interp+Azi)(Merak#1) MWD_Interp Azi 10506.69 14599.99 4-1/2" 4.500 755.48 2416.13 Merak#1 Rig Surveys(MWD+sag)(Merak#1) MWD+sag 2476.15 7166.22 Merak#1 Rig Surveys (MWD+sag)(Merak#1) MWD+sag 7166.22 8800.00 Merak#1 WP16.0(Merak#1) MWD+sag COMPANY DETAILS: Great Bear Petroleum 8800.00 8850.00 Merak#1 WP16.0(Merak#1) MWD+sag 8850.00 11207.00 Merak#1 ST1 WP16.0A(Merak#1 ST1) MWD+sag Calculation Method: Minimum Curvature 11207.00 14599.99 Merak#1 ST1 WP16.OA(Merak#1 ST1) MWD+sag Error System: ISCWSA • Scan Method: Tray.Cylinder North #, Error Surface: Elliptical Conic `'g, Warning Method: Error Ratio WELL DETAILS: Plan Merck • ligItg Ground Level: 174.70 +N/-S +E/-W Northing Easting Latittude Longitude 0.00 0.00 5839739.79 661410.35 69°58'7.368 N 148°42'48.292 W Project: Great Bear Project Site: Great Bear SECTION DETAILS Well: Plan Merak#1 Wellbore: Merak#1 ST1 Sec MD Inc Azi TVD +N/-S +E/-W DLeg TFace VSec Target Merak#1 ST1 WP16.0A 1 8850.00 9.00 315.00 8846.21 29.90 -53.56 0.00 0.00 59.01 2 8900.00 9.00 315.00 8895.60 35.43 -59.09 0.00 0.00 66.83 3 11599.99 90.00 315.00 10506.69 1369.27 -1392.93 3.00 0.00 1953.18 4 14599.99 90.00 315.00 10506 69 3490.59 -3514.26 0.00 0.00 4953.18 -1000- _ it West(-)/East(+)(1500 ft/in) -3750 -3000 -2250 -1500 -750 0 750 0- Jiiiiiiiii 1_ 1 1 1 1 1 1.1 11 1 I_ l I I 1 1 1 1 I I I I I I 1000- 3750- -3750 _ 4 _ Merak#1 ST1 WP16.OA 2000- 3000 -3000 13 3/8" - 4-1/2" - rn - c 3000- '212250-- -2250-. - Z o 0 M. Merak#1 WP16.0 c 4000- --1500- -1500"" + cn o r - ,,y Merak#1 Rig _ o o - x 5000- Z 750- 7" -750 5 s - : - o o B fn - 9 5/8"_ - - Tu 0 6000- 0- -0 _ Merak#1 Rig _ 13 3/8" - a) 7000 ! KOP:8850.00'MD,8846.21'TVD -750- --750 Top HRZ i i i i I i i i I i i i i I i r i r -3750 -3000 -2250 -1500 -750 0 750 9 5/8" Start Dir 3°/100':8900'MD.8895.6'TVD West(-)/East(+)(1500 ft/in) 8000- Base HRZ Kuparuk C 9000 �� =. Total Depth:14599.99'MD,10506.69'TVD Miluveach- _- - Upper Kingak "" End Dir :11599.99'MD,10506.69'TVD 10000- Lwr Kingak Base 4-1/2" - Top Shublik ° -a 11000-- Base Shublik Ivishak Merak#1 WP16.0 Merak#1 ST1 WP16.OA 12000- I I 11 I I T 1 r T--1 T 1__1_.I-._r._T.T-TT-r--T-1-T,--r11--TTT1-1 T17T1 T r_-r_-i 1 1_T_-T_T.__I -2000 -1000 0 1000 2000 3000 4000 5000 6000 7000 Vertical Section at 315.00°(2000 ft/in) H L_LIBURTOr Standard Proposal Report Database: EDM 2003.16 Single User Db Local Co-ordinate Reference: Well Plan Merak#1 Company: Great Bear Petroleum TVD Reference: Actual RKB @ 196 42f(KBE@174.7+Actual@2 Project: Great Bear Project MD Reference: • Actual RKB @ 196.42ft(KBE@174.7+Actual@2 Site: Great Bear North Reference: True Well: Plan Merak#1 Survey Calculation Method: Minimum Curvature Wellbore: Merak#1 ST1 Design: Merak#1 ST1 WP16.0A Project Great Bear Project Map System: US State Plane 1927(Exact solution) System Datum: Mean Sea Level Geo Datum: NAD 1927(NADCON CONUS) Using Well Reference Point Map Zone: Alaska Zone 04 Using geodetic scale factor Site Great Bear Site Position: Northing: 5,847,611.30ft Latitude: 690 59'23.898 N From: Map Easting: 665,578.34ft Longitude: 148°40'43.837 W Position Uncertainty: 0.00 ft Slot Radius: in Grid Convergence:,,, 1.24 ° Well Plan Merak#1 Well Position +N/-S 0.00 ft Northing: 5,839,739.79 ft Laude: 69°58'7.368 N +E/-W 0.00 ft Easting: 661,410.35 ft Longitude: 148°42'48.292 W Position Uncertainty 0.00 ft Wellhead Elevation: ft Ground Level: 174.70 ft Wellbore Merak#1 ST1 Magnetics Model Name Sample Date Declination Dip Angle Field Strength (0) (°) (nT) BGGM2012 8/31/2012 20 73 g 80.79 57,606 Design Merak#1 ST1 WP16 0A . o•.6t41i+ritiu,+M.3;'Pi£a44::0. +''V 4'. F .... ++az`k,°„vsv.M1.Wfi"WS.c: .i:.+,N`Azrvmwaaw9':44•tdk:+;SW*!f,4400 Sas1'.44,4444 44..4444tK.:2 at"+ff.#i'NeDkiitiU%kk➢ktt r"�":- Audit Notes: Version: Phase: PLAN Tie On Depth: 8.850 00 Vertical Section Depth From(TVD) +N/-S +EI-W Direction A'� * ftftft ° 14.,.4,4„;."4;,:''',,;i',4,:54:,4„,4!,44/,,`41, • 21.72 0.00 0.00 315.00 F"AN%ix ,m90.0vnwamly ..,.,, <'00' '-',. ,., rr 3.,.,.�40 r44' m7t'ssffim*1.0'f44„., r i.0 ..1, ,`4"M°..,w 4 Plan Sections I Measured Vertical TVD Dogleg Build Turn Depth Inclination Azimuth Depth System +N/-S +E/-W Rate Rate Rate Tool Face (ft) (0) (°) (ft) ft (ft) (ft) (°/100ft) (°/100ft) (°/100ft) (0) 8.850.00 9.00 315.00 8,846.21 8,649.79 29.90 -53.56 0.00 0.00 0.00 0.00 8,900 00 9.00 315.00 8,895.60 8,699.18 35.43 -59.09 0.00 0.00 0.00 0.00 11.599 99 90 00 315.00 10,506.69 10,310.27 1,369.27 -1,392.93 3.00 3.00 0.00 0.00 14.599.99 90 00 315.00 10,506.69 10,310.27 3,490.59 -3,514.26 0.00 0.00 0.00 0.00 xi Aff.s„- 9/4/2012 4:15:12PM Page 2 COMPASS 2003.16 Build 73 HALLIBURTDN Standard Proposal Report Database: EDM 2003.16 Single User Db Local Co-ordinate Reference: Well Plan Merak#1 Company: Great Bear Petroleum TVD Reference: Actual RKB @ 196.42ft(KBE@174.7+Actual@2 Project: Great Bear Project MD Reference: Actual RKB @ 196.42ft(KBE@174.7+Actual@2 Site: Great Bear North Reference: True Well: Plan Merak#1 Survey Calculation Method: Minimum Curvature Wellbore: Merak#1 ST1 Design: Merak#1 ST1 WP16.0A Planned Survey Measured Vertical Map Map Depth Inclination Azimuth Depth TVDss +N/-S +EI-W Northing Easting DLS Vert Section (ft) (°) (°) (ft) ft (ft) (ft) (ft) (ft) 8,649.79 8,850.00 9.00 315.00 8,846.21 8,649.79 29.90 -53.56 5,839,768.55 661,356.18 0.00 59.01 KOP:8850.00'MD,8846.21'ND 8,900.00 9.00 315.00 8,895.60 8,699.18 35.43 -59.09 5,839,773.96 661,350.53 0.00 66.83 Start Dir 3°/100':8900'MD,8895.6'TVD 8,918.04 9.54 315.00 8,913.40 8,716.98 37.48 -61.14 5,839,775.97 661,348.43 3.00 69.74 Top HRZ 9,000.00 12.00 315.00 8,993.91 8,797.49 48.31 -71.97 5,839,786.57 661,337.38 3.00 85.06 9,004.59 12.14 315.00 8,998.40 8,801.98 48.99 -72.65 5,839,787.23 661,336.69 3.00 86.01 Base HRZ 9,100.00 15.00 315.00 9,091.14 8,894.72 64.82 -88.48 5,839,802.72 661,320.53 3.00 108.40 9,141.81 16.25 315.00 9,131.40 8,934.98 72.78 -96.44 5,839,810.52 661,312.40 3.00 119.66 LCU-Kuparuk C 9,200.00 18.00 315.00 9,187.01 8,990.59 84.90 -108.56 5,839,822.37 661,300.03 3.00 136.80 9,220.42 18.61 315.00 9,206.40 9,009.98 89.43 -113.10 5,839,826.81 661,295.40 3.00 143.21 Miluveach 9,300.00 21.00 315.00 9,281.26 9,084.84 108.50 -132.16 5,839,845.47 661,275.94 3.00 170.17 9,400.00 24.00 315.00 9,373.64 9,177.22 135.56 -159.22 5,839,871.95 661,248.32 3.00 208.44 9,487.13 26.61 315.00 9,452.40 9,255.98 161.89 -185.55 5,839,897.72 661,221.44 3.00 245.68 Upper Kingak 9,500.00 27.00 315.00 9,463.89 9,267.47 165.99 -189.66 5,839,901.74 661,217.25 3.00 251.48 9,600.00 30.00 315.00 9,551.76 9,355.34 199.73 -223.39 5,839,934.75 661,182.81 3.00 299.19 9,700.00 33.00 315.00 9,637.01 9,440.59 236.67 -260.33 5,839,970.90 661,145.10 3.00 351.44 9,800.00 36.00 315.00 9,719.42 9,523.00 276.72 -300.38 5,840,010.09 661,104.22 3.00 408.07 9,900.00 39.00 315.00 9,798.74 9,602.32 319.76 -343.42 5,840,052.21 661,060.28 3.00 468.94 10,000.00 42.00 315.00 9,874.78 9,678.36 365.68 -389.34 5,840,097.15 661,013.41 3.00 533.88 10,100.00 45.00 315.00 9,947.30 9,750.88 414.35 -438.01 5,840,144.78 660,963.73 3.00 602.71 10,200.00 48.00 315.00 10,016.13 9,819.71 465.63 -489.29 5,840,194.96 660,911.38 3.00 675.24 10,300.00 51.00 315.00 10,081.07 9,884.65 519.40 -543.06 5,840,247.58 660,856.50 3.00 751.27 10,400.00 54.00 315.00 10,141.94 9,945.52 575.49 -599.15 5,840,302.47 660,799.24 3.00 830.59 10,500.00 57.00 315.00 10,198.57 10,002.15 633.76 -657.42 5,840,359.49 660,739.76 3.00 913.00 10,600.00 60.00 315.00 10,250.82 10,054.40 694.04 -717.70 5,840,418.49 660,678.22 3.00 998.25 10,700.00 63.00 315.00 10,298.53 10,102.11 756.17 -779.84 5,840,479.29 660,614.79 3.00 1,086.12 10,800.00 66.00 315.00 10,341.57 10,145.15 819.99 -843.65 5,840,541.74 660,549.65 3.00 1,176.37 10,900.00 69.00 315.00 10,379.84 10,183.42 885.31 -908.97 5,840,605.67 660,482.97 3.00 1,268.75 11,000.00 72.00 315.00 10,413.21 10,216.79 951.96 -975.62 5,840,670.89 660,414.94 3.00 1,363.00 11,100.00 75.00 315.00 10,441.61 10,245.19 1,019.75 -1,043.41 5,840,737.23 660,345.73 3.00 1,458.87 11,200.00 78.00 315.00 10,464.95 10,268.53 1,088.50 -1,112.16 5,840,804.51 660,275.56 3.00 1,556.10 11,207.00 78.21 315.00 10,466.40 10,269.98 1,093.34 -1,117.00 5,840,809.25 660,270.61 3.00 1,562.95 7" 11,207.02 78.21 315.00 10,466.40 10,269.98 1,093.36 -1,117.02 5,840,809.26 660,270.60 3.00 1,562.97 Lwr Kingak Base-Top Shublik 11,300.00 81.00 315.00 10,483.17 10,286.75 1,158.02 -1,181.68 5,840,872.54 660,204.59 3.00 1,654.41 11,400.00 84.00 315.00 10,496.22 10,299.80 1,228.11 -1,251.78 5,840,941.14 660,133.03 3.00 1,753.55 11,500.00 87.00 315.00 10,504.07 10,307.65 1,298.60 -1,322.26 5,841,010.12 660,061.08 3.00 1,853.23 9/4/2012 4:15:12PM Page 3 COMPASS 2003.16 Build 73 HALLIBURTON Standard Proposal Report Database: EDM 2003.16 Single User Db Local Co-ordinate Reference: Well Plan Merak#1 Company: Great Bear Petroleum TVD Reference: Actual RKB @ 196.42ft(KBE@174.7+Actual@2 Project: Great Bear Project MD Reference: Actual RKB @ 196.42ft(KBE@174.7+Actual@2 Site: Great Bear North Reference: True Well: Plan Merak#1 Survey Calculation Method: Minimum Curvature Wellbore: Merak#1 ST1 Design: Merak#1 ST1 WP16.0A Planned Survey Measured Vertical Map Map Depth Inclination Azimuth Depth TVDss +N/-S +El-W Northing Easting DLS Vert Section (ft) (0) (0) (ft) ft (ft) (ft) (ft) (ft) 10,310.27 11,599.99 90.00 315.00 10,506.69 10,310.27 1,369.27 -1,392.93 5,841,079.28 659,988.94 3.00 1,953.17 End Dir :11599.99'MD,10506.69'ND 11,600.00 90.00 315.00 10,506.69 10,310.27 1,369.28 -1,392.94 5,841.079.28 659,988.94 1.38 1,953.18 11,700.00 90.00 315.00 10,506.69 10,310.27 1,439.99 -1,463.65 5,841,148.48 659,916.75 0.00 2,053.18 11,800.00 90.00 315.00 10,506.69 10,310.27 1,510.70 -1,534.36 5,841,217.68 659,844.57 0.00 2,153.18 11,900.00 90.00 315.00 10,506.69 10,310.27 1,581.41 -1,605.07 5,841,286.88 659,772.39 0.00 2,253.18 12,000.00 90.00 315.00 10,506.69 10,310.27 1,652.12 -1,675.78 5,841,356.08 659,700.21 0.00 2,353.18 12,100.00 90.00 315.00 10,506.69 10,310.27 1,722.83 -1,746.49 5,841,425.27 659,628.03 0.00 2,453.18 12,200.00 90.00 315.00 10,506.69 10,310.27 1,793.54 -1,817.20 5,841,494.47 659,555.85 0.00 2,553.18 12,300.00 90.00 315.00 10,506.69 10,310.27 1,864.25 -1,887.91 5,841,563.67 659,483.66 0.00 2,653.18 12,400.00 90.00 315.00 10,506.69 10,310.27 1,934.96 -1,958.62 5,841,632.87 659,411.48 0.00 2,753.18 12,500.00 90.00 315.00 10,506.69 10,310.27 2,005.67 -2.029.33 5,841,702.07 659,339.30 0.00 2,853.18 12,600.00 90.00 315.00 10,506.69 10,310.27 2,076.38 -2,100.05 5,841,771.27 659,267.12 0.00 2,953.18 12,700.00 90.00 315.00 10,506.69 10,310.27 2,147.09 -2.170.76 5,841,840.46 659,194.94 0.00 3,053.18 12,800.00 90.00 315.00 10,506.69 10,310.27 2,217.81 -2.241.47 5,841,909.66 659,122.76 0.00 3,153.18 12,900.00 90.00 315.00 10,506.69 10,310.27 2,288.52 -2.312.18 5,841,978.86 659,050.57 0.00 3,253.18 13,000.00 90.00 315.00 10,506.69 10,310.27 2,359.23 -2,382.89 5,842,048.06 658,978.39 0.00 3,353.18 13,100.00 90.00 315.00 10,506.69 10,310.27 2,429.94 -2,453.60 5,842,117.26 658,906.21 0.00 3,453.18 13,200.00 90.00 315.00 10,506.69 10,310.27 2,500.65 -2,524.31 5,842,186.46 658,834.03 0.00 3,553.18 13,300.00 90.00 315.00 10,506.69 10,310.27 2,571.36 -2,595.02 5,842,255.65 658,761.85 0.00 3,653.18 13,400.00 90.00 315.00 10,506.69 10,310.27 2,642.07 -2,665.73 5,842,324.85 658,689.67 0.00 3,753.18 13,500.00 90.00 315.00 10,506.69 10,310.27 2,712.78 -2,736.44 5,842,394.05 658,617.49 0.00 3,853.18 13,600.00 90.00 315.00 10,506.69 10,310.27 2,783.49 -2,807.15 5,842,463.25 658,545.30 0.00 3,953.18 13,700.00 90.00 315.00 10,506.69 10,310.27 2,854.20 -2,877.86 5,842,532.45 658,473.12 0.00 4,053.18 13,800.00 90.00 315.00 10.506.69 10.310.27 2,924.91 -2,948.57 5,842,601.65 658,400.94 0.00 4,153.18 13,900.00 90.00 315.00 10,506.69 10,310.27 2,995.62 -3,019.28 5,842,670.84 658,328.76 0.00 4,253.18 14,000.00 90.00 315.00 10,506.69 10,310.27 3,066.33 -3,089.99 5,842,740.04 658,256.58 0.00 4,353.18 14,100.00 90.00 315.00 10,506.69 10,310.27 3,137.04 -3,160.71 5,842,809.24 658,184.40 0.00 4,453.18 14,200.00 90.00 315.00 10,506.69 10,310.27 3,207.75 -3,231.42 5,842,878.44 658,112.21 0.00 4,553.18 14,300.00 90.00 315.00 10,506.69 10,310.27 3,278.47 -3,302.13 5,842,947.64 658,040.03 0.00 4,653.18 14,400.00 90.00 315.00 10,506.69 10,310.27 3,349.18 -3,372.84 5,843,016.84 657,967.85 0.00 4,753.18 14.500.00 90.00 315.00 10,506.69 10,310.27 3,419.89 -3,443.55 5,843,086.04 657,895.67 0.00 4,853.18 14.599 99 90.00 315.00 10.506.69 10,310.27 3,490.59 -3,514.25 5,843,155.23 657,823.50 0.00 4,953.17 Total Depth: 14599.99'MD,10506.69'TVD-4-1/2" Casing Points Measured Vertical Casing Hole Depth Depth Diameter Diameter (ft) (ft) Name (in) (in) 14,599.99 10,506.69 4-1/2" 4.500 6.125 11,207.00 10,466.40 7" 7.000 8.500 8,800.00 8,796.83 9 5/8" 9.625 12.250 2,447.00 2,446.79 13 3/8" 13.375 17.500 9/4/2012 4:15:12PM Page 4 COMPASS 2003.16 Build 73 HALLIBURTON Standard Proposal Report Database: EDM 2003.16 Single User Db Local Co-ordinate Reference: Well Plan Merak#1 Company: Great Bear Petroleum TVD Reference: Actual RKB @ 196.42ft(KBE@174.7+Actual@2 Project: Great Bear Project MD Reference: Actual RKB @ 196.42ft(KBE@174.7+Actual@2 Site: Great Bear North Reference: True Well: Plan Merak#1 Survey Calculation Method: Minimum Curvature Wellbore: Merak#1 ST1 Design: Merak#1 ST1 WP16.0A Formations Measured Vertical Vertical Dip Depth Depth Depth SS Dip Direction (ft) (ft) ft Name Lithology (0) (0) 11,207.02 10,466.40 Lwr Kingak Base 9,004.59 8,998.40 Base HRZ 971.54 971.40 Permafrost 5,856.94 5,856.40 Upper Schrader Bluff 9,141.81 9,131.40 LCU 10,618.40 Ivishak 9,487.13 9,452.40 Upper Kingak 9,141.81 9,131.40 Kuparuk C 11,207.02 10,466.40 Top Shublik I 9,220.42 9,206.40 Miluveach 10,585.40 Base Shublik 8,918.04 8,913.40 Top HRZ 7,166.06 7,165.40 Campanian Flooding Surface 6,522.99 6,522.40 Lower Canning 8,513.30 8,512.40 MCU Plan Annotations Measured Vertical Local Coordinates Depth Depth +N/-S +E/-W (ft) (ft) (ft) (ft) Comment 8,850.00 8,846.21 29.90 -53.56 KOP 8850.00'MD,8846.21'TVD 8,900.00 8,895.60 35.43 -59.09 Start Dir 3°/100':8900'MD,8895.6'TVD 11,599.99 10,506.69 1,369.27 -1,392.93 End Dir : 11599.99'MD, 10506.69'TVD 14,599.99 10,506.69 3,490.59 -3,514.25 Total Depth: 14599.99'MD, 10506.69'TVD ,4 9/4/2012 4::15:12PM Page 5 COMPASS 2003.16 Build 73 Great Bear Petroleum Great Bear Project Great Bear Plan Merak #1 Merak #1 ST1 Merak #1 ST1 WP16.0A Anticollision Summary Report 04 September, 2012 Anticollision Summary Report Company: Great Bear Petroleum Local Co-ordinate Reference: Well Plan Merak#1 Project: Great Bear Project TVD Reference: Actual RKB @ 196.42ft(KBE@174.7+Actual@ Reference Site: Great Bear MD Reference: Actual RKB @ 196.42ft(KBE@174.7+Actual@ Site Error: 0.00ft North Reference: True Reference Well: Plan Merak#1 Survey Calculation Method: Minimum Curvature Well Error: 0.00ft Output errors are at 2.00 sigma Reference Wellbore Merak#1 ST1 Database: EDM 2003.16 Single User Db Reference Design: Merak#1 ST1 WP16.0A Offset TVD Reference: Offset Datum Reference Merak#1 ST1 WP16.0A Filter type: GLOBAL FILTER APPLIED:All wellpaths within 200'+100/1000 of refer( Interpolation Method: MD Interval 25.00ft Error Model: ISCWSA Depth Range: Unlimited Scan Method: Tray.Cylinder North Results Limited by: Maximum center-center distance of 1,657.83ft Error Surface: Elliptical Conic Warning Levels Evaluated at: 2.00 Sigma Survey Tool Program Date 9/4/2012 From To (ft) (ft) Survey(Wellbore) Tool Name Description 205.22 659.01 Merak#1 Rig Surveys(MWD_Interp+Azi) MWD_Interp Azi Fixed:v2:standard dec with interpolated azimuth 755.48 2,416.13 Merak#1 Rig Surveys(MWD+sag)(Merak MWD+sag Fixed:v2:standard declination+sag 2,476.15 7,166.22 Merak#1 Rig Surveys (MWD+sag)(Mera MWD+sag Fixed:v2:standard declination+sag 7,166.22 8,800.00 Merak#1 WP16.0(Merak#1) MWD+sag Fixed:v2:standard declination+sag 8,800.00 8,850.00 Merak#1 WP16.0(Merak#1) MWD+sag Fixed:v2:standard declination+sag 8,850.00 11,207.00 Merak#1 ST1 WP16.0A(Merak#1 ST1) MWD+sag Fixed:v2:standard declination+sag 11,207.00 14,599.99 Merak#1 ST1 WP16.0A(Merak#1 ST1) MWD+sag Fixed:v2:standard declination+sag Summary Reference Offset Distance Measured Measured Between Between Site Name Depth Depth Centres Ellipses Separation Offset Well-Wellbore-Design (ft) (ft) (ft) (ft) Factor Warning Great Bear Plan Merak#1 -Merak#1 -Merak#1 Rig 7,175.00 7,175.00 0.00 -0.94 0.001 Stop Drilling CF< 1.0,C( Plan Merak#1 -Merak#1 -Merak#1 Rig 7,200.00 7,200.00 0.01 -1.02 0.011 Stop Drilling CF<1.0,E: Plan Merak#1 -Merak#1 -Merak#1 WP16.0 8,900.00 8,900.00 0.00 -0.75 0.000 Stop Drilling CF<1.0,C( Plan Merak#1 -Merak 1A(lateral)-Merak 1A 8'DLS W 9,986.27 10,329.80 701.77 685.60 43.408 CC Plan Merak#1 -Merak 1A(lateral)-Merak 1A 8°DLS W 10,000.00 10,350.00 715.43 685.54 23.935 ES.SF CC-Min centre to center distance or covergent point,SF-min separation factor,ES-min ellipse separation 9/4/2012 4:14:19PM Page 2 COMPASS 2003.16 Build 73 Anticollision Summary Report Company: Great Bear Petroleum Local Co-ordinate Reference: Well Plan Merak#1 Project: Great Bear Project TVD Reference: Actual RKB @ 196.42ft(KBE@174.7+Actual@ Reference Site: Great Bear MD Reference: Actual RKB @ 196.42ft(KBE@174.7+ActualC Site Error: 0.00ft North Reference: True Reference Well: Plan Merak#1 Survey Calculation Method: Minimum Curvature Well Error: 0.00ft Output errors are at 2.00 sigma Reference Wellbore Merak#1 ST1 Database: EDM 2003.16 Single User Db Reference Design: Merak#1 ST1 WP16.0A Offset TVD Reference: Offset Datum Reference Depths are relative to Actual RKB @ 196.42ft(KBE@174.71Coordinates are relative to.Plan Merak#1 Offset Depths are relative to Offset Datum Coordinate System is US State Plane 1927(Exact solution),Alaska Zone 04 Central Meridian is 150°0'0.000 W° Grid Convergence at Surface is: 1.21° Ladder Plot 1 I 1 1 1 I 1 60 0 1 I I I I I I I I I I 1 I I I I I I J I I I I 1 I I I I I I I I I I I I I I I I I I I 1200 I I I I I I 1 I I I I I C I 1 I I I I I I I I I I J J J A- CU I 1 I I I 11 AI I 1 I 1 I CU I I I I 1 ;�+ m 800 ' p I 1 I I I I C I I I I I I J f] I I I I 1 I I I I I I • I 1 I I I I I I I I I I 400 q I 1 I I I I I 1 I I I I I I I I 1J I 1 I I I I J J J _ _ __ J_ �> J 1 I I 1 1 1 I I I I I I I 1 1 1 FA 1 i I 11 /� I 0 C 0 2000 4000 6000 8000 10000 12000 Measured Depth LEGEND PlanMerakkl,MerakN1,Merak#1Rig VO $ Plan Merakig1,Merakip1.Merak#1WP16.0V0 PanMerakpl,Merdr maerajiMeraklAsnoL_:'JUP: CC-Min centre to center distance or covergent point,SF-min separation factor,ES-min ellipse separation 9/4/2012 4:14:19PM Page 3 COMPASS 2003.16 Build 73 Merak # 1 Proposed Wellbore Diagram 20" Conductor @ 93' Port Collar @ 500' 0 0 • • •0 m .• ► Type P ES Stage Tool 13 3/8" Casing w/ Packer @ — 2,400' L- 80, 68 lbs /ft, BTC A TD @ 2,441' 4-1/2" Tubing P-110, 13.5 lbs /ft, ST- L Top of 7" Liner 280' Above 9-5/5' Shoe 9 - 5/8" Casing �� L- 80, 47 lbs /ft, BTC c 4-1/2" Liner 8,736' MD / 8,731' TVD P-110, 13.5 lbs /ft, HY 521 " tll 11� 1i 7" Liner (Top Shublik) wo ••••••v P - 110, 29 lbs /ft, BTC - M .;.;.;.;.;.;., ..............,. pO.O••pp•❖p•❖•❖•; 8-1/2" Hole ••2°:•:•.%3:.:=9:.:..x:•: 1 .❖.❖.❖.••❖.❖.❖.•• .000•.000❖.o❖.•. ..❖.❖0..0• ❖e Merak # 1 TD 11 ,200' MD / 11 ,200' TVD (150' Below Base Shublik) DRAWN BY: A. MICI REV: 04 SEP 2012 Aeat.k-±'( Pit ZtziotO Regg, James B (DOA) From: Regg, James B (DOA) l'301[ Sent: Thursday, August 30, 2012 2:47 PM elei� zs To: 'Smith, Matt(GE Oil & Gas, VG)' Cc: Schwartz, Guy L (DOA); DOA AOGCC Prudhoe Bay Subject: RE: Great Bear Petroleum_Drilling Adapter Port Matt—Thank you for the drawings. Your comment about not being clear where AOGCC regulation stops pertaining to threaded connections warrants response. AOGCC is concerned with more than the permanently installed wellhead equipment; if we left you with the impression during past discussions that we were only concerned about permanent equipment it was unintentional. AOGCC regulations address preventing the release of wellbore fluids to atmosphere from primary and secondary well control perspectives. In this case,the 1" port is exposed to well pressure while drilling the next hole section, and anything that might compromise the threaded nipple,1/4 turn valve, and the loss of primary well control (drilling fluids) would result in a release to atmosphere. As observed by the AOGCC Inspector,the configuration does not meet AOGCC secondary well control equipment standards and represents an unnecessary hazard to well integrity while the temporary wellhead adapter is installed. It is unclear what purpose this port—as configured with 1" threaded nipples and 1/4 turn valve— serves during the drilling of the 9-5/8" hole section. If there is a purpose of the assembly attached to the port that is key to the well construction, AOGCC is willing to hear your arguments. Resolution of the situation at Great Bear's Merak#1 on Tuesday 8/28/12 was to remove the equipment threaded into the 1" port on the temporary wellhead adapter (2 threaded nipples, a collar, and 1/4 turn valve) and replace with a bull plug. The plugged 1" port did hold 5000psi several times during the AOGCC-witnessed BOPE test. Jim Regg AOGCC 333 W.7th Ave,Suite 100 Anchorage,AK 99501 907-793-1236 From: Schwartz, Guy L (DOA) Sent: Tuesday, August 28, 2012 3:36 PM To: Regg, James B (DOA) Subject: Fwd: Great Bear Petroleum_Drilling Adapter Port Jim Did u see this?? I vaguely remember discussing with Vetco ... Any resolution ? Sent from my iPhone Begin forwarded message: From: "Smith, Matt (GE Oil & Gas, VG)" <matt.smith cr ge.com> To: "Schwartz, Guy L (DOA)" <guy.schwartz a alaska.gov> Subject: Great Bear Petroleum_Drilling Adapter Port Guy, 1 I have attached drawings of this so that you have a visual of what it is i am referring to. It seems that the AOGCC inspector/witness for the Alcor I well has taken issue with a 1.00" port on our adapter. This is a temporary drilling adapter; we had covered/discussed these in our last meeting where it was decided that we were only looking at permanently installed wellhead equipment. Per instruction, I have ensured that all connections on our wellhead and tree are indeed flanged or studded. Also, it has not yet been clarified where the threaded connection regulation "stops" (i.e. test ports, injection ports, NPT ports, LDS, Control line ports, etc. The rig wants to modify our rental adapter by welding up this 1.00" port. Welding up of this connection is not an approved barrier as opposed to the currently installed (and tested) 6,000 psi nipple and 6,000 psi valve. Rig is standing by and I need your help on this one Sir. Thanks, Matt Matt Smith Technical Account Manager GE Oil & Gas T+1 907.522.3940 F +1 907.522.3974 M +1 907.244.9150 H +1 907.688.0825 E matt.smith@ge.com<mailto:matt.smith a,ge.com> 880 H Street, Suite 202 Anchorage, AK, 99501, USA GE imagination at work 2 s.. ° �� 3 a) rxe N cato V .'. 0. U U 'C cs 2 -cs ais 0 tom" -0 .5. a) y a) E O. •Q., ,-0 a) >> •. t~ 00 E a) O O `, M '0. H N• O~-o I 0 r-, o ct ob• 2 o> N - > ;, cl 41) - a) p 0O,. O a) O O N -. �� a) — cd o - °� �' a) o0 N C) •-• N -- o0 ai 3-1 mt 3 b O c "0cz, cd a) O .O 1, t1. ct Z U Ct 'tMI 4. °' > a)N - U0 = a) ,_: o CA a) > CA _ 04 30 3 oo ° a)3 V o..0 cc. ct cd E-, o E U �, a) U o f E N a) t. • c to ° •-•'' a) �. ocA ° ~ o bA «i C� F- 0 - o -,--, c� cl a) ai— .E. 8 ct a) — yd? ,, ,. N •^. I 3 C o a) ° ct w > 41E ¢ d: .o1 "o ct ct ct >o -,a) - E a) o 7 � • .0 O U a) o U -o t1 0 b o 'C 0• o o cr `0D o 0 ai Co �73 ' 0 Cc� k" N O0 yam., O Oo Q" c,,,, U U U o Q" an b4 O O Q. 4t ° ,- N U ° °O,nx'' U O b o a - MHCo dZ -oH o ' H ., ° > U cd ) C w C O Cl,O U 3 GQ O c 3 .� - \ il Cd ,0 _ : N fah 00 oc N Q. 1 '2 Q - ille N O x 0 . tom. •., 5 wr e •C7 E t ` .. + ; C F. A V . . � i a w mikk'L ' . _ *,..,...,...'**.'. :..,./.."....,.,:47. 4:_:L.'11.'I,*':"..:,,'-'7:',:;.:_,..,.''''.-.'1',.... O ee O 2, N 00 6> O (-1 k cd r1i. Regg, James B (DOA) From: Schwartz, Guy L (DOA) Sent: Tuesday, August 28, 2012 3:36 PM To: Regg, James B (DOA) Subject: Fwd: Great Bear Petroleum_Drilling Adapter Port Attachments: H270784-2_Drilling Adapter_Pin.pdf; ATT00001.htm; Great Bear Drilling Adapter Stackup.pdf; ATT00002.htm Jim Did u see this?? I vaguely remember discussing with Vetco ... Any resolution ? Sent from my iPhone Begin forwarded message: From: "Smith, Matt (GE Oil & Gas, VG)" <matt.smith@ge.com> To: "Schwartz, Guy L (DOA)" <guy.schwartz@alaska.gov> Subject: Great Bear Petroleum_Drilling Adapter Port Guy, I have attached drawings of this so that you have a visual of what it is I am referring to. It seems that the AOGCC inspector/witness for the Alcor I well has taken issue with a 1.00"port on our adapter. This is a temporary drilling adapter; we had covered/discussed these in our last meeting where it was decided that we were only looking at permanently installed wellhead equipment. Per instruction, I have ensured that all connections on our wellhead and tree are indeed flanged or studded. Also, it has not yet been clarified where the threaded connection regulation "stops" (i.e. test ports, injection ports, NPT ports, LDS, Control line ports, etc. The rig wants to modify our rental adapter by welding up this 1.00" port. Welding up of this connection is not an approved barrier as opposed to the currently installed (and tested) 6,000 psi nipple and 6,000 psi valve. Rig is standing by and I need your help on this one Sir. Thanks, Matt Matt Smith Technical Account Manager GE Oil & Gas T +1 907.522.3940 1 F +1 907.522.3974 M +1 907.244.9150 H +1 907.688.0825 E matt.smith(cage.com<mailto:matt.smith(aIge.com> 880 H Street, Suite 202 Anchorage, AK, 99501, USA GE imagination at work 2 W , 1 (pi-6 al tolo. 1 -- - l B t 8 -z I t! Ilro i 1 1 Y ., t TOP OF RIG MATS t ; mre . s '3 . .; 13-98"10,000 PSI 6BX 1 s.00" STOP OF RIG MAZSr ' - 9.071 — 6.00" DRILLING ADAPTER 13-5/81 5,000 Ni-2 6 fI II Milli 8.93" 18.00" ---DRILLING ADAPTER 48.44` GROUND —._... ..�- _. LEVEL i O O --- -_.- — 58.14" 5 13-5/8"5,000 PSI 6BX D . a /11:Z 31.07` 2-1/16'5.000 PSI RI I -4I 1 i Pii .-— �1 ice► i� a .... _,. . ::: 1. c•1, J -.n. ,: a— --13.318"QUICK DISCONNECT -- I h{ 3 N: .1. -_ 13-318"FLUTED CASING HANGER J 1 ---._---20"LANDING RING 1 ----I -----20"ODCSG "-----133/8"OD CSG i INSTALLATION OF DRILLING ADAPTER vetco9ra LAYOUT / SNE STEPS '0 I= NPIZOIOZ-I20 INC Iwnno:i p L_ ,, 0 m J 6. g \ 44 .:0 1 0 0 47 y 1).s. 00.=V”. X03 m•o •40 0I). �=et O tog 0 4 a H 0 0 (a1., .EI NI 60 0 44 ‘@", 1w nn — nn, y � n.,A el O w V) NI----=IMO 0 4111==-- - sc aV " rN r ] Cr CK 1 C12 La laJ I % 00 m li rr s �z 41 Ck" ... %0 0 I l 1 I 0**/,., , #‘104. EVrifr...1 F 7—z Ct.CL 11 0 b 4 ' O 71 !°.....L''''. :\ Om ' O4,,� p X44 if NN. 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" "*. .4 - i bA 714 CO N 00 N 00 _...._ it 0 cm 'O .b cz N Ti 0 0 It 1 I ... Page 1 of 1 Schwartz, Guy L (DOA) From: Bill Penrose [bill@solstenxp.com] Sent: Tuesday, August 14, 2012 10:54 AM To: Schwartz, Guy L(DOA) Cc: Ted Stagg; 'clark@greatbearpetro.com'; Buzz Yohman Subject: SCSSV in the Great Bear Merak#1 Guy, Great Bear Petroleum requests approval to frac,flow back and production test its Merak#1 exploration well without an SCSSV installed as that tool is inappropriate for the work planned. The way we're currently considering casing this well is as follows: - 9-5/8" intermediate casing set in vertical hole to approximately the top of the HRZ - 7" liner(hung in the 9-5/8")from the bottom of the 9-5/8" casing across the build section that lands out nearly horizontal in the Shublik - 4-1/2" liner(hung in the 7")from the bottom of the 7"to TD in the horizontal Shublik section - 4-1/2"tie-back string from surface to the top of the 4-1/2" liner We plan to frac,flow back and production test the Shublik Shale through the 4-1/2"string. Maximum treating pressure is set at 8,000 psi. Our concern is that an SCSSV in the 4-1/2" string is not well suited to fraccing through nor is conducting coil tubing operations and we would like to leave the SCSSV out of the string until the well is either placed on production (if it ever is) or we can prove the well incapable of unassisted flow. This latter is likely; none of these shale play wells are expected to flow on their own. Mitigating the lack of an SCSSV during fraccing,flowback and testing is that during all of these events Operator's representatives will be constantly present, monitoring the well and in a position to shut it in at the surface. Later, if the well is to be produced and will flow on its own, an SCSSV will of course be installed. Please let me know if you have any questions or concerns. Regards, Pearrtode Drilling Manager x FullColor_sma 310 K Street,Suite 700 Anchorage,Alaska 99501 Main 907-279-6900 Direct 907-264-6114 Cell 907-250-3113 R/14/2012 ( ) 'Gp 1G1 NF1 _ _ '`, f //SEAN PARNELL, GOVERNOR L Irk�+ �., L ALASKA OIL AND GAS 333 W.7th AVENUE,SUITE 100 CONSERVATION COMMISSION ANCHORAGE,ALASKA 99501-3539 PHONE (907)279-1433 Clark Clement FAX (907)276-7542 Chief Operating Officer Great Bear Petroleum Operating, LLC 601 W 5th Avenue, Suite 505 Anchorage, AK 99501 Re: Exploratory Field, Exploratory Pool, Merak #1 Great Bear Petroleum Operating, LLC Permit No: 212-101 Surface Location: 45' FSL, 5008' FEL, T7N, R14E, SEC. 8, UM Bottomhole Location: 2080' FNL, 1338' FEL, T7N, R14E, SEC. 17, UM Dear Mr. Clement: Enclosed is the approved application for permit to drill the above referenced exploration well. In accordance with 20 AAC 25.005(f), all records, data and logs acquired for the pilot hole must be clearly differentiated in both name Merak #1 plus PH and API number (50-223-20027-70) from records, data and logs acquired for well Merak #1. This permit to drill does not exempt you from obtaining additional permits or approvals required by law from other governmental agencies, and does not authorize conducting drilling operations until all other required permits and approvals have been issued. In addition, the Commission reserves the right to withdraw the permit in the event it was erroneously issued. A weekly status report is required from the time the well is spudded until it is suspended or plugged and abandoned. The report should be a generalized synopsis of the week's activities and is exclusively for the Commission's internal use. Operations must be conducted in accordance with AS 31.05 and Title 20, Chapter 25 of the Alaska Administrative Code unless the Commission specifically authorizes a variance. Failure to comply with an applicable provision of AS 31.05, Title 20, Chapter 25 of the Alaska Administrative Code, or a Commission order, or the terms and conditions of this permit may result in the revocation or suspension of the permit. Sincerely, - Cathy P. oerster Chair DATED this day of August, 2012. cc: Department of Fish & Game, Habitat Section w/o encl. (via e-mail) Department of Environmental Conservation w/o encl. (via e-mail) FECIIlitL) STATE OF ALASKA AL. A OIL AND GAS CONSERVATION COME. ON JUL 2 5 2012 PERMIT TO DRILL AOGCC 20 MC 25.005 la.Type of Work: lb.Proposed Well Class: Development-Oil U Service- Winj ❑ Single Zone ❑ 1c.Specify if well is proposed for Drill ❑✓ - Redrill ❑ Stratigraphic Test ❑ Development-Gas ❑ Service-Supply ❑ Multiple Zone ❑., • Coalbed Gas ❑ Gas Hydrates ❑ Re-entry ❑ Exploratory Q ' Service- WAG ❑ Service-Disp ❑ Shale Gas/ ❑ 2 Operator Name• 5. Bond: Blanket ❑✓ Single Well ❑ 11.Well Name and Number: ' Great Bear Petroleum Operating LLC Bond No. B007354 • Merak#1 • 3.Address: 6.Proposed Depth: 12.Field/Pool(s): 601 W.5th Avenue,Suite 505,Anchorage,Alaska 99501 MD: . 14,277 TVD. • 10,594 Exploration - 4a. Location of Well(Governmental Section): 7.Property Designation(Lease Number). Surface: 45'FSL,5008 FEL,T7N,R14E,Sec 8,UM ' ADL 391706 ' 4 I?/64- Nae Top of Productive Horizo 411'FNL,1061'FWL T7N,R14E,Sec 17,UM 8.Land Use Permit: 13.Approximate Spud Date: LONS 11-007 August 5,2012 • Total Depth:2,080'FNL,1,338'FEL,T7N,R14E,Sec 17,UM 9.Acres in Property. 14.Distance to Nearest Property: 5630 5200' 4b.Location of Well(State Base Plane Coordinates-NAD 27): 10.KB Elevation above MSL: . 198.4feet 15.Distance to Nearest Well Open Surface: x-661411.16 - y- 5839740.79 • Zone-4 GL Elevation above MSL: • 175.1feet to Same Pool: 5 mi.to Alcor#1 16.Deviated wells. Kickoff depth: 9,230'BKB feet 17.Maximum Anticipated Pressures in psig(see 20 AAC 25.035) Maximum Hole Angle: 90 degrees Downhole: 5,837 psi - Surface: 4,758 psi - 18.Casing Program Specifications Top - Setting Depth - Bottom Cement Quantity,c.f or sacks Hole Casing Weight Grade Coupling Length MD TVD MD TVD (including stage data) 26 20" 129.45 X-56 weld 80' 0' 0' 80' 80' ' Driven with surface grout S,i..rk 16" 13 3/8" 68# L-80 BTC 2,500' 0' 0' 2,500' • 2,500' 3,350 ft'PF L+380 ft'Class G IN-f t 12 1/4" 9 5/8" 47# L-80 BTC-M 8,650' 0' 0' 8,650 • 8,650 2311 ft'Lead 375 ft'Tail 200 ft'Ann -C 1'8 1/2" 7" 29# P-110 BTC-M 10,939 0' 0' 10,939 . 10,544' • 509 f Class G 16 1/8" 4 1/2" 13.5# P-110 H 521 3,838 10,439' 10,300 14,277 - 10,594 un-cemented,swell packers 19 PRESENT WELL CONDITION SUMMARY(To be completed for Redrill and Re-Entry Operations) Total Depth MD(ft). Total Depth TVD(ft): Plugs(measured): Effect Depth MD(ft): Effect.Depth TVD(ft): Junk(measured): Casing Length Size Cement Volume MD TVD Conductor/Structural Surface Intermediate Production Liner Perforation Depth MD(ft): Perforation Depth TVD(ft): 20. Attachments. Property Plat ❑ BOP Sketch❑✓ Drilling Program ❑✓ Time v.Depth Plot ❑l Shallow Hazard Analysis Diverter Sketch❑✓ Seabed Report ❑ Drilling Fluid Program ❑✓ 20 AAC 25.050 requirements❑ 21. Verbal Approval Commission Representative: Date 22. I hereby certify that the foregoing is true and correct. Contact Bill Penrose 907-250-3113 Printed Name Clark Clement Title Chief Operating Officer SignatureefASAWY; ; --Phone 907-868-8070 Date 7/2$ I/2- Commission Use Only /( Permit to Drill 2. / API Number: Permit Approval See cover letter for other Number: (2_ ��'( 50-2z3-2L62,2-- -`'Date: IZ requirements. Conditions of approval: If box is checked,well may not be used to explore for,test,or produce coalbed m thane,gas hydrates,or gas contained in sh les• J❑ Other: -IE ceop 05_ 66 f ` /,e 5•f-. Samples req'd: Yes[t�No❑ Mud log req'd: Yes [�] No❑ I /� _ L HZS measures: Yes[�No El Directional svy req'd: Yes Q No❑ �e eel` Sc rn rn€.4,. K K `.� a cj r'''' ' S ' LeY - ? dim f APP OVED BY THE COMMISSION DATE S —7 — 1 COMMISSIONER ni1 flG1NAL "Ft/iTz Form 10-401(Revised 7/2009) This permit is valid for 24 months from the date of approval(20 AAC 25.005(g)) Submit in Duplicate 2S A- } 4 4• i Great Bear Petroleum Operating LLC A New Direction for the Last Frontier 601 W. 5`" Ave., Suite 505, Anchorage, AK 99501 Phone: (907) 868-8070, Fax: (907) 868-3887 July 25, 2012 Ms. Cathy Foerster, Chair RECE51VED Alaska Oil and Gas Conservation Commission 601 West 5th Ave., Suite 505 JUL 2 5 2012 Anchorage, Alaska 99501 A nA RE: Application for Permit to Drill: Merak #1 ~OG�'"�+ Dear: Ms. Foerster, Great Bear Petroleum Operating LLC hereby applies for a Permit to Drill a new oil exploration well from an onshore pad near the Dalton Highway south of Deadhorse, Alaska. Great Bear plans to use Nabors Rig 105AC to drill its Merak #1 well. The MerakC1- 51 � / #1 will initially consist of a vertical pilot hole with 20" conductor pipe, 13 3/8" surface casing, 9 5/8" intermediate casing and 8-1/2" open hole to TD to obtain cores and logs through the target HRZ, Kingak and Shublik intervals. The pilot hole will then be plugged back and the well sidetracked with a horizontal lateral in the zone of interest. 7" intermediate casing will be set at or near the top of the Shublik formation. A 6-1/8" lateral will then be drilled and cased with a 4-1/2" liner extending from TD to above the 7" casing shoe. This liner will not be cemented. It will be equipped with external swell packers. The lateral will be drilled using Managed Pressure Drilling (MPD) technology for directionally drilling an 81/2" hole through the Kingak Formation to the top of the Shublik Formation. A static mud weight of 10.5 ppg will be used and will exceed the pore pressure of all exposed formations in this interval. MPD will be used to increase ECD to 11.5-12.5 ppg to assist in stabilizing the Kingak shale. Prior to tripping pipe or running 7" casing, the well will be displaced to a kill weight mud with a density equivalent to the maximum ECD held during drilling. After setting the 4-1/2" liner, the rig will be moved off to drill another well while the Merak #1 is hydraulically fractured and production tested. A separate Application for Sundry Approval for the hydraulic fracturing and production testing will be submitted. Bringing the Unconventional Resource Play to Alaska April 25, 2012 Page 2 of 2 Please find attached information as required by 20 MC 25.005 (a) and (c) for your review. Pertinent information attached to this application includes the following: 1) Form 10-401 Application for Permit to Drill 2) A plat showing the surface location of the well 3) Proposed Drilling Program 4) Drilling Time vs. Depth Plot 5) Geological Prognosis 6) Merak #1 Proposed Wellbore Diagram 7) Seismic and Offset Well Shallow Hazards Analyses / 8) Drilling Area Risks Discussion 9) Pressure Calculations (MASP) 10)Casing Properties and Design Factors 11)Fluid, Fracture and Temperature Gradient Curves 12)Diagrams and Descriptions of the BOP Equipment to be Used 13)Diagram of the Managed Pressure Drilling Equipment to be Used 14)Summary Drilling Fluid Program 15)Summary Cementing Program 16)Summary Directional Program 17)Great Bear does not anticipate the presence of H2S in the formation to be encountered in this well. However, H2S monitoring equipment will be functioning on the rig at all times during drilling and completion operations. 18)The following are Great Bear's designated contacts for reporting responsibilities to the Commission: 1) Completion Report Bill Penrose, Drilling Manager (20 MC 25.070) (907) 264-6114 2) Geologic Data and Logs Ed Duncan, President and CEO (20 MC 25.071) (907) 868-8070 If you have any questions or require additional information, please contact Bill Penrose at (907) 264-6114 or (907) 250-3113. Sincerely, Great Bear Petroleum Operating LLC / 4_ , Clark Clement, Chief Operating Officer Attachments Cc: Bill Penrose - SolstenXP Bringing the Unconventional Resource Play to Alaska Merak #1 General Drilling Program 1. Ensure regulatory compliance training is complete and key personnel are fully aware of responsibilities. 2. Install 20" conductor and a 10' diameter, 10' deep cellar. 3. Diverter riser assembly should be made to length according to diverter space out schematic. 4. Conduct specific tour safety meetings with each crew on the potential of gas hydrates or shallow gas and the handling of same. 5. Pick up and stand back 2,000' of 4" drill pipe and 500' of HWDP. Note: 4", 5-135, 15.7#, XT 39 drill pipe will be used for all hole sections on Merak#1. 6. Notify the AOGCC within 48 hours of intent to spud and plans to perform diverter function test and drills. 7. Ensure that pipe rams are available for the following pipe sizes: 9-5/8", 7" and 4 %" casing, 4" drill pipe. 8. Install 21 1/4" 2000 psi diverter with 16" outlet line. Fill diverter & riser with water to check for leaks. Function test and record on IADC drilling report. Send completed Diverter Test form to AOGCC as specified on the form. Hold diverter drill prior to drilling surface hole. RU cement return lines from the 4" outlets on the 20". 9. A conventional spud mud, 8.8 ppg minimum, will be used on the surface hole. 10. PU 16" bit and bottomhole assembly including MWD. Test the BHA below the rotary table. 11. Spud well with reduced drilling parameters. Gradually increase drilling parameters when the BHA is below the conductor shoe. 12. Drill 16" hole vertically to 2,500' as per the directional plan and mud plan. Controlling ROP may be necessary to prevent packing off, lost circulation or flow over the top of the bell nipple. No sliding is expected in this section. 13. Actual TD will be based on ROP and mud logging data so as to place shoe in minimum 50' shale section if possible. Great Bear Geologist will assist in picking casing seat. 14. Make short trips as required, circulate and condition mud and POH. Stand back the BHA to save time and move as rapidly as feasible toward running surface casing. The surface hole BHA can be laid down after cementing 13 3/8" casing. 15. Rig up casing running equipment and Frank's top drive fill up tool. 16. Run 13 3/8", 68#, L-80, BTC casing, monitoring returns and filling casing with fill up tool. A TAM collar will be installed in the 13 3/8" casing at 500' to be used in case a second stage cement job is required. urk 17. Cement 13 3/8" casing to surface, using the inner string method, according to the G5� cementing program. Notify AOGCC immediately if the cement did not reach surface. Perform second stage cementing through the TAM collar if the cement did not reach surface. 18. Nipple down the diverter. 19. Make up and install GE O&G 13 5/8", 5k casing head, 13 5/8" drilling spool and 13 5/8" 5K BOP stack. Note: 11", 10k x 13 5/8" 5k intermediate head will be installed after landing and cementing 9 5/8" casing. 20. Notify AOGCC 48 hours prior to testing BOPE. Test BOPE to 250 psi low and 5,000 psi high (See Permit to Drill for reference). Note: BOP tests are required every 7 days on exploration drilling projects. 21. MU 12 1/4" directional BHA with LWD tools (DIR, GR, PWD) and test. Spud mud will be used to drillout the shoe track. Test casing to 3,000 psig for 30 min making sure to chart the test. Drill shoe track and 20' of new formation. 22. Switch out to 9.2 ppg LSND per mud program before LOT. 23. Perform LOT. Record the results on the Morning Report and in the IADC report. Note: Minimum acceptable LOT is 11.5 ppg. s i.t1 24. Circulate and establish baseline parameters. Drill vertical 12 1/4" hole with mud motor and LWD-PWD system. 25. Slow down drilling and circulate for samples according to Great Bear mud logging procedures. The wellsite geologist will assist in formation tops determination. 26. Drill to intermediate casing point at top of the HRZ at 8,650' MD/TVD. Great Bear geologist will determine casing point. 27. Circulate and condition mud and POOH for open hole logs. 28. Perform E-line logging as follows: Triple Combo with GEM and Compensated Spectral Gamma Ray Dipole Sonic and OMRI(Oil Mud Micro Imager) MRIL (Nuclear Magnetic Resonance Tool) I. a `8 29. After a-line work is complete, perform a wiper trip and prepare to run casing. �'"k�, 30. Run 9 5/8", 47#, L-80, BTC casing and cement per program. Establish injectivity into 9 5/8" x 13 3/8" annulus. Install 9 5/8" pack-off and test, RU to annulus awl downsqueeze 9 5/�" �j 13 3/8" annulus with Permafrost cement per the program. S rl �� rosy "��"I I. 31. Nipple down stack and install intermediate wellhead spool. NU BOP and test. Install bowl protector. 32. PU clean out BHA. RIH. Test casing to 3000 psi. Drill shoe track and 20' new hole. Displace to 9.4 ppg MOBM coring fluid. Note: Density of coring fluid will be increased up to 10.5 ppg as needed for pore pressure and for shale stability. Perform FIT to 11.5 DDR EMW. Drill to core point per geologist. POOH. qy/ " 511.-c- 33. MU coring BHA. Core the HRZ formation as directed by Geologist. POOH with coring tools. Cut and package cores and send for lab analysis. p�°kr 1 34. MU and RIH with 8 1/2" drilling BHA and LWD. Ream through the cored hole and continue drilling to the Kingak core point per Great Bear Geologist. The LWD logging suite will include DIR, GR, PWD. Circulate and condition for coring. POOH. 35. MU coring BHA. Core the Kingak formation as directed by Geologist. POOH with coring tools. Cut and package cores and send for the lab analysis. 36. MU and RIH with 8 1/2" drilling BHA and LWD. Ream through the cored hole and continue • drilling to the Shublik core point per Great Bear Geologist. The LWD logging suite will include DIR, GR, PWD. Circulate and condition for coring. POOH. 37. MU coring BHA. Core 90 to 120 ft (one or two trips) in the Shublik formation as directed by • Geologist. POOH with coring tools. Cut and package cores and send for the lab analysis. 38. Finish drilling the 8 %" hole section to 10,794 ft or 150 ft below base of Shublik as directed . by Geologist. Back-ream and MAD pass through all pay zones. POOH BHA. 39. Prepare for the Reservoir Evaluation E-line operations. 40. Perform E-line logging as follows: Triple Combo with GEM and Compensated Spectral Gamma Ray Dipole Sonic and OMR'(Oil Mud Micro Imager) MRIL (Nuclear Magnetic Resonance Tool) 41. After a-line work is complete, perform a wiper trip and prepare to plug back the open hole to approx. 9,100 ft. 42. RIH with cement stinger. Lay consecutive, balanced cement plugs from TD to approx. 9,100 e/af ft. The top cement plug will be used as a kick-off plug for the sidetrack. 43. Install and test surface equipment for Managed Pressure Drilling (MPD) in the sidetrack I " hole. An MPD valve numbering diagram (VND) is attached. 44. MU and RIH with 8 'A" directional assembly with LWD. Kick-off the cement plug. Maintain constant ECD via MPD as needed to stabilize shales. Drill to the top of the Shublik formation (+/- 10,939, 10,544' TVD) per the directional plan. Circulate and condition mud and POOH. i° vel-L-- 45. L45. Rig down MPD equipment. Install and test rams for 7" casing. Run 7", 29#, P-110, BTC-M casing per MPD and cementing procedures. Top of�c7em(� ent to be 1000 ft above 9 5/8" shoe '7 at top HRZ. '' S d" w/ ro .a av ^. , L 46. ND stack and install GE wellhead ool. Test wellhead and BOPE. 47. MU and RIH with 6 1/8" bit and directional assembly. LWD to include GR, RES and PWD. Pressure test 7" casing to 3500 psi for 30 min. Displace well to 9.2 ppg KCI/Polymer WBM for drilling the Shublik lateral. 48. Drill out 7" shoe and 20 ft new hole. Perform FIT to 11.5 ppg, 49. Directionally drill 3,000 ft horizontal hole in the Shublik per directional plan. Condition hole and POOH. 50. Install and test rams for 4 'A" casing. 51. MU and run 4 'A", 13.5#, P-110, Hydril 521 casing with 16 swell packers per completion procedure. Displace liner and open hole with MOBM to activate swell packers. Set VersaFlex liner hanger with top at approx. 10,439' MD (10,300' TVD). Test hanger to 3500 psi. Displace well to 9.8 ppg NaCI. POOH with liner running tool while laying down drill pipe. 52. Test casing to 3500 psi. Install dry hole tree and test against test plug to 10,000 psi. Remove test plug (two-way check) and install back pressure valve 53. Rig down Nabors 105 AC and release. At this point the operations on the Merak #1 well will be complete. An application for the Sundry Notice to stimulate and test will be submitted separately. Casing will be tested to 8000 psi as part of the stimulation program. IFre"` a, CL in in f0 N u 'L 0 N t r+ Le) a, � v ani lba' CD u — 0) ✓ 0 D N. _ _ 0 co t = U ce to a a! V'- 0 co a _ N 7.- sr O a0 U sr J o7 0 J c% C) co C N r >4 M a, o 2 RI o o a N r = o > CL 07 N ul = d - -+ E M0 u • Y Q. 2 c7 -. _ __-. - 2 Ccc• s >. co w7 d• = N Z N L U) CD I— 06 Lo N CU v CCti)CI) N a� 0 I ICI _ O _- J re 00 N ' t �..; ¢ da m L 0 N C = C R N -0r0 E b- a G 2 N , _ 7 la u v C7 U w NC 00 N N 47 N 0) C-- _ N 010 ao U — ---_ _ N.n. C ...I N CO in N e\4 (0 00 U U _ i 0 0 aJ M Cs1G M t OC C o cL co aD H co r f\ e-1 (1) to 0 a r) N O O O O O O O O O O O O O O CO O O N CO CO O N CO (;ea;)sada°peinsee j Target Zone Geological Prognoses (July 20, 2012) Merak#1 Lat 69.9687464 N, 148.7134433 W Pad Elev. 175.5' AMSL, KB to GL 23.3 ft, KB Elev. 198.8'AMSL Formation Depth SS Elevation (KB) Depth BKB Permafrost 869 199 1068 Staines 199 Canning 4855 199 5054 Seabee 7096 199 7295 Hue 8206 199 8405 HRZ 8445 199 8644 Base HRZ 8695 199 8894 LCU 8695 199 8894 Top Lwr Kingak(K-1) 10120 199 10319 Base Lwr Kingak(K-1) 10345 199 10544 Top Shublik 10345 199 10544 Base Shublik 10445 199 10644 Fire Creek 10445 199 10644 Ivishak 10570 199 10769 TD 10595 199 10794 Merak # 1 ' Proposed Wellbore Diagram psi! :"4i CMT =►ii :4ti 20" Conductor @ 80' ► 9 - 5/8" x 13 - 3/8" Annulus •'` �— Downsqueezed with Port Collar @ 500' oo Permafrost Cement 4. 13 - 3/8" Casing :. • A Cement to Surface 13 -3/8" Casing •? •` ' "• I.D. 12.415" •• Burst Rating: 4,930 PSI 13 -3/8" Casing Cement: Cement to Surface with L- 80, 68 lbs /ft, BTC — 11.-- APermafrost Lead and TD @ 2,500' Class "G" Tail 9-5/8" Casing I.D. 8.681" Burst Rating: 6,870 PSI ••i Cement: Class G from 9 5/8" Shoe• N to 13-3/8"Shoe. «a ''`=" 7" Casing I.D. 6.184" Burst Rating: 11,220 PSI Cement: Cement 7" Shoe to 1,000 Above HRZ. ' 4- 1/2" Casing 7" Casing I.D. 3.920" Cement to 1,000' Burst Rating: 12,410 PSI Above HRZ Cement: None. To be Completed with Swell Packers 9 - 5/8" Casing , L- 80, 47 lbs /ft, BTC 4to 14 4-1/2" Liner Top HRZ - 8,650' MD • ', P-110, 13.5 lbs/ft, HY 521 u, 7" Casing (Top Shublik) ►:,, P - 110, 29lbs/ft, BTC - M ►K.>. 1 1 -- 10,939' MD / 10,544' ND °.% 00004•-.: 4.5" Liner Top .:+:••:+:•: �.�- ....::::::..•..,.. IIIIIILTTTIIIII -- 10,439' MD / 10,300'ND �I0 00•0.•.00;.0w } ♦.•41 wN � F P ►�4if I f4 �•,ff444*A•i44. 8-1/2" Hole :44,,,,4.,►.•,,00,„...mot �`�r►i4i4i ii4i14i4i4i4:4i:::4ii Plug Back to -- 9100' MD Merak # 1 TD Merak # 1 ST TD 10,794' MD / 10,794' TVD 14,277' MD / 10,594' ND (150' Below Base Shublik) (Mid - Shublik) REV: 23 JULY 2012 MERAK#1 DRILLING RISKS The histories of offsetting, previously drilled wells were closely examined to identify drilling risks and potential problems in the Merak#1. The offsetting wells examined are: Arco Pipeline State#1 Mobil Kadleroshilik#1 Conoco Sequoia#1 Arco North Franklin Bluffs#1 BLM Franklin Bluffs#1 Anadarko Jacob's Ladder C Shell Lake 79 Federal#1 Hemi Springs Unit#3 Hemi Springs Sag River#1 Toolik Federal#2 Wolfbutton 25-6-9 Based on the problems found in the drilling records for these wells, the identified drilling risks for the Merak#1 wells are divided into High Probability, Moderate Probability and Low Probability categories as discussed below. High Probability No Cement to Surface When Cementing Surface Casing All but one of the offsetting wells failed to bring cement to surface during the primary cementing job on the surface casing. Cement volumes ultimately used on these wells, including top jobs, varied from 3 to 8 times the volume calculated for an in-gauge hole. It has long been known that excessive circulation, multiple trips and elevated mud temperatures lead to dramatic hole enlargement in the permafrost interval. An examination in all the offset wells of the time interval between spud and pumping surface casing cement reveals a roughly linear relationship between that time and the amount of excess cement each well required (i.e. the longer the hole is open, the higher the percent excess cement is required). / The excess cement planned to be pumped in the Great Bear wells is based on the anticipated J number of days between spud and pumping cement. However, the volume will be adjusted before cementing to take into account the actual open hole time. For further assurance that cement will be brought to surface, the surface casing in all of the Great Bear wells will contain a port collar placed at+500' for use if the primary cement job fails to reach the surface. Shale Instability The two nearest offset wells to the Great Bear drilling locations, Pipeline State#1 and Sequoia #1, each experienced simultaneous lost returns, flowing conditions and rapid wellbore deterioration resulting in packing off and swabbing in the HRZ/Pebble Shale (at 10,360' in the Pipeline State#1) and Kingak Shale(at 8,910' in the Sequoia#1). There are known wellbore instability problems associated with the HRZ and Kingak shales in wells drilled across the developed North Slope. Some of the factors contributing to hole instability in these shales are insufficient mud weight, high deviation and wellbore azimuth. Generally, the Kingak shales exhibit higher risk and severity than the shallower HRZ. Published studies of these two troublesome shales include stability diagrams that relate hole angle, azimuth and optimum mud weight for keeping the shales as stable as possible. Great Bear's initial wells will be vertical holes so mud weight is the only controllable variable. The planned mud weights of 10.0 to 10.7 ppg, recommended as optimal by the HRZ and Kingak / stability charts, will be used. Moderate Probability Loss of Circulation Two of the offset wells experienced minor losses of circulation at varying depths. Most of the _ mud weights being used at these times is unrecorded. To minimize this as a potential problem, the planned mud weight curve will be adhered to unless hole conditions dictate otherwise. Tight Hole The majority of the geologic column to be drilled below the surface casing shoe consists of slowly water-reactive shales. These shales hydrate and swell with time,requiring occasional wiping of the hole via short or round trips. The only offset wells that experienced tight hole problems(notably Jacob's Ladder C) were those in which the operator waited too long between wiper or round trips. While drilling the Great Bear wells, a short or, as necessary, round trip will be performed every 1,000' drilled or 24 hours since the last trip, whichever comes first. Low Probability Gas Hydrates Methane hydrates within the permafrost interval have been encountered in various locations south and west of the Kuparuk River Field where they can be troublesome, reducing hydrostatic columns and inducing well kicks. Hydrates were not recorded in any of the wells offsetting the ✓ Great Bear locations along the Sag River and none are expected in the wells to be drilled there. However, there remains a remote possibility of encountering hydrates and caution will be exercised. Merck#1 WitOffset Well Casing and Cementing Information (Surface casing highlighted) Pipeline State#1 Kadleroshilik Unit#1 Sequoia#1 Jacob's Ladder Lake 79 Federal#1 Franklin Bluffs 16"Conductor 20"Conductor 20"Conductor 20"Conductor 30"Conductor 10-5/8"Structural Casing •Set at 115' •Set at 65' •Set at 135' •Set at 110' •Set at 57' •Set at 8' •Cemented with 194 sks CSII •Cemented with 379 sks Permafrost •cemented with 324 sks Permafrost •No cementing information available •cemented with180 sks Permafrost •Cemented to surface,no details 13-3/8"Casing 20"Casing 6.5/8"Conductor •Set at 308' •Set at 280' •Set at 76' •Cemented with 630 sks Permafrost •Cemented with 280 sks Permafrost, •Cemented to surface.no details good returns. 9-5/8"Surface Casing 9-5/8"Surface Casing 13-3/8"Surface Casing 13-3/8"Surface Casing 13-3/8"Surface Casing •Set at 3,853' •Set at 1,228' •Set at 2,500' •Set at 3,429' •Set at 2,280' •Cemented with 1200 sks CSIII and •Cemented with 950 sks Permafrost.•Cemented w/1100 sks CSII+ •Cemented w/1561 sks ASL+321 •Cemented with 810 sks Class G. 250 sks Class G Lost returns. Open FO at 383'and 300 sks Class G. Performed 10 bbl sks tail w/o cement to surface. Opened DV at 1,528'and pumped •Top job w/100 sks CSII pump 700 bbls LCM w/no returns. top job. Performed two top jobs,625 sks+ 2,980 sks Permafrost w/o cmt to Performed 185 sks top job. 314 sks. surface. Perform 160 sks top job. 7 Casing 9-5/8"Casing 9-5/8"Casing •Set at 2,294' •Set at 11,005' •Set at 11,077' •Could not circ 7". Perf above shoe •Cemented with 788 sks lead+331 •Cemented with 550 sks Class G+ Pump 400 sks Permafrost w/o rtns. sks tail 150 sks via DV tool at 2,417'. Performed 290 sks top job. Franklin Bluffs Ut#1 Hemi Springs Unit#3 Toolik Federal#1 Tgolik Federal#2 Wolfbutton 25-6-9 13-3/8"Conductor 16"Conductor 20"Conductor 13-3/8"Conductor 20"Conductor •Set at 92' •Set at 80' •Set at 108' •Set at 88' •Set at 109' •Cemented with 107 sks Permafrost •No cementing information available •Cemented with 175 sx Fonda •Cemented w/70 sks Fondu-FlyAsh •Cemented w/5 yds Permafrost cmt to surface. 9-5/8"Casing •Set at 811' •Cemented with 240 sks Fondu— FlyAsh and a 10 sk top job. 9-5/8"Surface Casing 9-5/8"Surface Casing 13-3/8"Surface Casing 7"Surface Casing 13-3/8"Surface Casing •Set at 1,710' •Set at 4,580' •Set at 1,565'(planned for 2,500') •Set at 2,190' •Set at 2,477' •Cemented with 2900 sks Perma- •Cemented with 1,300 sks Perma- •Cemented with 1,100 sks Class G+•Cemented with 300 sks Fondu+ •Cemented with 2,604 cu ft frost to surface. frost E+300 sks Class G. Top job 860 sks Fondu(via DV-no surf 200 sks Fondu-FlyAsh. Good Permafrost+top job of 96 cu ft performed with 100 sks Perma- returns)+130 sks Fondu top job. returns. Permafrost frost C. 9-5/8"Casing •Set at 3,552'(due to sticky hole) •Cemented with 1,500 sks Class G- no returns to surface. a y � Composite Mud Weight Plot Mud Weight(PPG) 8 9 10 11 12 13 14 15 16 1,000 2,000 -U—Sequoia#1(191-136 3,000 —*—Jacob's Ladder 1206-152) 4,000 — - —0—She I Lake 79 Fed(169-056) 5,000 —*—Franklin Bluff(105-105) 6,000 tet--Hemi Springs(85-22) sNz.„ 7,000 t t,, 8,000 G. d 0 9,000 10,000 11,000 12,000 13,000 14,000 15,000 16,000 Composite LOT / FIT Plot Equivalent Mud Weight(PPG) . 10.0 11.0 12.0 13.0 14.0 15.0 1,000 A 2,000 • ■ • 3,000 A 4,000 • 5,000 •LOT Wolfbutton ■LOT Sequoia 1 -c 6,000 a. p •LOT Hemi Springs S.R. 1 7,000 •LOT Hemi Springs 3 8,000 A FiT Frankling Bluff 1 9,000 _ A FIT Pipeline State 1 FIT Jacob's Ladder 1 10,000 FIT Hem Springs S.R. 1 11,000 12,000 F.9 MAXIMUM ANTICIPATED SURFACE PRESSURES (MASP) Great Bear Petroleum Operating LLC Merak#1 Note: Here MASP for each hole section is defined as the pore pressure at the next casing point less a gas column to surface. 16" Hole Section (80' —2500') This hole section will be drilled with a diverter only, no BOPs. While MASP will equal the formation pore pressure at the surface casing shoe depth of 2,500' less a gas gradient to the surface, it cannot be shut in, only diverted. Calculation: MASP1c, = (2,500 ft) ((9.5 ppg x 0.052)-0.1 psi/ft) = 985 psi 12 1/4" Hole Section (2,500' —8,650') The maximum anticipated surface pressure (MASP) for the 12 1/4"hole section in this vertical hole will be the formation pore pressure at 8,650' TVD less a full gas column to the surface. Offsetting well information indicates that the maximum pore pressure in the 12 '/"hole will be 9.4 ppg EMW. The gas column in the well is assigned a density gradient of 0.1 psi/ft. Calculation: MASP12 y,- = (8,650 ft) ((9.4 ppg x 0.052)-0.1 psi/ft) = 3,363 psi 8 'A" Hole Section (8,650' — 10,794') vertical core section Offset well information indicates that the maximum pore pressure in the 8 '/2"hole will be 10.4 ppg• MASP8 y2" = (10,794 ft) ((10.4 ppg x 0.052)-0.1 psi/ft) = 4,758psi 8 t/Z" Hole Section (9,230'TVD— 10,544'TVD) directional sidetrack to Top Shublik Offset well information indicates that the maximum pore pressure in the 8 t/z"hole will be 10.4 ppg• MASP8 1/2"sidetrack = (10,544 ft) ((10.4 ppg x 0.052)-0.1 psi/ft) =4,648 psi • 6 1/8" Hole Section (10,544'TVD— 10,594'TVD) Horizontal in Shublik Offset well information indicates that the maximum pore pressure in the 6 1/8"hole will be 9.2 ppg• MASP6 1/8"horizontal = (10,594 ft) ((9.2 ppg x 0.052)-0.1 psi/ft) = 4,009 psi vd N 1' ! y i ,�f 21 '`,,,. _ Merak #1 Casing Design Verification Planned Casing Programetx)D. S t.cr`. 1 ,' /Air. L L“..41,1-15w.)24; f i s 20" 13 3/8" 9 5/8" 7" 4.5" Depth (MD) 80 2,500' 8,650' 10,939 14,277-10,439 Depth (TVD) 80 2,500' 8,650' 10,544' 10,594-10,300 Hole Size 26" 16" 12 1/4" 8 W' 6 1/8" Weight (ppf) 129.45# 68# 47# 29# 13.5# Grade X-56 L-80 L-80 P-110 P-110 Connection weld BTC BTC BTC-M BTC-M Nominal ID (in) 18.75" 12.415" 8.681" 6.184" 3.920" The well will be drilled to a TD of 10,794' MD (10,794'TVD)to core and log the HRZ/Kingak/Shublik formations. After logging,the well will be plugged back and sidetracked for a horizontal completion in the Shublik Formation. API Casing Design Factors Design factors are essentially "safety factors"that allow the design of safe, reliable, casing strings. Each operator may have his own set of design factors based on his experience and the condition of the pipe. Here we use the following design factors: Tensile Joint Strength: Nt= 1.8 Collapse (from external pressure): Nc= 1.125 Burst (from internal pressure): Ni = 1.1 The pore pressures and fracture gradients used here are those derived from studies of offsetting well data in the north-south Sag River corridor approximately 40 miles south of Deadhorse,Alaska. Maximum Pore pressure is indicated to be 10.4 ppg in the HRZ—Kingak interval. Pore pressure in the Shublik is indicated to be 9.2 ppg. Design Factor Calculations Burst Requirements Use maximum anticipated surface pressures (MASP)for each casing string. For each casing string, MASP is the formation pressure at the next casing point less a gas column to surface. 13 3/8", 68#, L-80, BTC Surface Casing: MASP at 12 1/4" hole section TD of 8,200'TVD (Intermediate casing): MASP= (8,650')((9.4 ppg x 0.052)-0.1 psi/ft) =3,363 psi DFb= burst strength/burst stress =4,930 psi/3,363 psi =1.46 9 5/8", 47#, L-80, BTC Intermediate Casing: MASP at 8 1/2" hole section TD of 10,794'TVD(core hole): MASP= (10,794')((10.4 ppg x 0.052)-0.1 psi/ft) p.4 I' =4,758psi I, DFb = burst strength/burst stress =6,870 psi/4,758 psi =1.44 7",29#, P-110, BTC-M Intermediate Casing: MASP at 6 1/8" hole section TD of 10,594'TVD(Shublik Horizontal): MASP= (10,594')((9.2 ppg x 0.052)-0.1 psi/ft) =4,009psi DFb= burst strength/ burst stress =11,220 psi/4,009 psi ' =2.79 Collapse Requirements Use an external pressure consisting of formation pore pressure at the casing shoe and an internal pressure of a gas column to surface. 13 3/8", 68#, L-80 BTC Surface Casing: External pore pressure =9.4 x 0.052 x 2,500' =1,222 psi Internal pressure w/gas only =0.1 x 2,500' =250 psi Collapse Stress =1,222 psi—250 psi =972 psi DFc=collapse rating/collapse stress =2,270 psi/972 psi =2.33 9 5/8', 47#, L-80, 8TC Intermediate Casina: External pore pressure =9.4 x 0.052 x 8,650' =4,228 psi Internal pressure w/gas only =0.1 x 8,650' =865 psi Collapse Stress =4,228 psi—865 psi =3,363 psi DFc= collapse rating/collapse stress =4,750 psi/3,363 psi =1.41 7", 29#, P-110, 8TC-M Intermediate Casino: External pore pressure =10.4 x 0.052 x 10,544' =5,702psi Internal pressure w/gas only =0.1 x 10,544' = 1,054 psi Collapse Stress =5,702 psi—1,054 psi =4,648 psi DFc=collapse rating/collapse stress =8,510 psi/4,648 psi =1.83 Merak # 1 Predicted Pore Pressure, Mud Weight k and Fracture Gradient Equivalent Mud Weight (PPG) 8.0 9.0 10.0 11.0 12.0 13.0 14.0 15.0 0 1000 13-3/8"Casing at 2,500'MD 2000 3000 Predicted Mud Weight 4000 •• 5000 •• 6000 - •• Predicted Fracture Gradient H 7000 •• L 0. 8000 •• aJ4 9-5/8"Casing •• *• at 8,650'MD 9000 Predicted 8-1/2" Sidetrack 10000 - Pore Pressure w/MPD 7"Casing 4 • • at 10,439'MD 11000 • 12000 •• 6-1/8" Shublik Lateral 13000 •� ._ 14000 • - . •• 4.5" Liner at 14,277'MD 15000 14111 Alcor, Merak, Mizar, Megrez, Dubhe & Alioth Regional Temperature Gradient Temperature, deg F 0 50 100 150 200 250 300 0 2,000 Temperature Gradient= 1.62 deg F/t 100' 4,000 6,000 8,000 cu10,000 Data Sources Conoico Sequoia #_ - 12,000 Anadarko Jacobs Sadder-C Shell Lake 79 Federal ff1 Mobil W. Kadleroshi4 Unit#1 # } Arco Pipeline State#1 14,000 16,000 1 b >� g a ' _ �_ 6 a H 1oa, g FP 1 CD Z j 1 O . t W 2 w cc .. I. .: ! _ I u. a p > \ N i Jm0 W ow co r aW � .2 I N y\ O z oN 2 N OW7 c�cn + Ca ! cr , Z a ol- eo e J w 1Ct— I O $Lu w CO e g LLJ I-1J CO la oLo 1 44;l' N I omeg W + § Z Q �n_ a J j — O CO W J LD W Z H r I I co I 1.g J U e H 1--.ft-.ti -1- .z y ,z _ O n i W W I � Z- 0 co c,_ - go J'— _ ZI OO W I Q t-n Cr) I U cp O j -F Z + WI-Li J O Q W p W W V) C W O CO In N U I 0 R t., a b =8a g fii d Q I m 11' W z IliF2 gq Q- , Z =� s 1g J @ m% 1 I U y ZOI in li 41 " � " Z (n�57(Lu cs311 /I 1.4 t6 . JPO a2 1 —I y W [[ (f) cc pla gLL ' I CO T I N >= I? � I N �>i�'>ii° H Co � 1 � �'333� T O_.rs.m< O L ^ J -, � I 1 E iii it H � � 111 I I- r Fyiyl yyyyrr y� Q� 1--{ ■111��■�11�/ 17111/EN EM O_7 ,._... 111 � Wt \ II W II W rm.-- rn CI ' I o O QCC I W C° n-,,,,ZI_ Oo W I O O Q Q W W .. 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' w 3 a ., of w f s aI `r; 0 s N 1 5 _._ - • g _ 1 ®%1 i m ;0 ' ° r= x1111, 11 z — (1a Ti o6 i f C� moW vi 01.1 Y + W k v o 49 12© e& I a ¢ ,a gI �o i i Z (al 9. � I e s I zosf.z--- - ly j ° U 4 ? Ox /24 o > o a X-c — / I 1 5 e I® ., I g . a{ ^L c 3 o i o la & 2 c. i 1 i j Merak#1 Drilling Fluid Program Summary Ppg.Mud Exp. Potential Depth Mud Type Weight Fracture Drilling Baroid Solutions Gradient Hazard Shallow • Constant pit 0-2500' Freshwater/ 13.0 gas kick/ monitoring for MD AQUAGEL 8.8-9.5 ppg EMW Loss increase in pit spud mud circulation volume • Constant 2,500'- Wellbore monitoring of mud 8,650' MD losses/ returns, dilution as LSND 9.2-9.5 ppg 13.0-13.6 needed. To Top EMW Breathing HRZ • Lower MW through non pressurized formations. 8,650'— • Maintain 10,794' p ko Baracarb/Barablok MD 1k Loss to seal off sands, Vertical MOBM 10.5 ppg 13.6-13.9 circulation/ shale and to bridge EMW formation. Hole for Pack off Cores& Maintain Low Logs HPHT fluid loss. • Maintain Baracarb/Barablok 9,230'- �)11 10.5 ppg to seal off sands, shale and to bridge 10,939' ***MPD 13.6-13.9 Shale formation. MD MOBM EMW EMW instability Maintain Low Directional 12.0-12.5 HPHT fluid loss. Sidetrack PPg Maintain a constant pressure on the shales. • Maintain low ECD 10,939'- Continually monitor 14,277' 0 13.8 Shublik DFG+Dril ahead MD KCUP lymer 9.2 ppg EMW wellbore graphics and adjust Shublik breathing mud accordingly for Horizontal hole cleaning and ECD management. *** Managed Pressure drilling will be utilized to maintain adequate pressure for hole stability in the shales(not for hydro carbon control). A mud cap(heavy weight pill)will be spotted to maintain the EMW on bottom if any trips are needed while building to the 72°+/-angle. The entire wellbore will be displaced to a weighted fluid prior to running the 7"casing. This fluid will be weighted to equal the EMW that was being held on the wellbore at TD of the interval (currently planned to be in the 12.0 to 12.5 ppg range). Merak#1 Casing and Cement Summary 16" Surface Hole: 80-2500' MD 13 3/8", 68#, L-80, BTC casing to be cemented to surface using Inner String Method Lead Slurry: 3,350 cu ft Permafrost L 5v7 s.s Density: 11.1 ppg downhole Yield: 4.15 cu ft/sk Tail Slurry: 380 cu ft Class G 3 Z 2 5X Density: 15.8 ppg Yield: 1.18 cu ft/sk 12 %" Intermediate Hole: 2500' —8,650' MD/TVD 9 5/8", 47#, L-80, BTC casing long string to be cemented to shoe of surface casing 9 5/8" x 13 3/8" annulus to be cemented via the downsqueeze method Lead Slurry: 2,311 cu ft `r 8.? s K s Density: 12.5 ppg Yield: 2.34 cu ft/sk Tail Slurry: 375 cu ft Class G 32G SKs Density: 15.8 ppg Yield: 1.15 cu ft/sk Annulus: 200 cu ft Permafrost L SY s Dote)— SQL Density: 11.1 ppg downhole c7.A Yield: 4.15 cu ft/sk 7" Intermediate Hole (sidetrack): 8,650' MD/TVD to 10,939' MD, 10,544'TVD 7", 29#, P-110, BTC-M long string to be cemented to 1000' above 9 5/8" shoe Lead Slurry: 509 cu ft Class G Density: 15.8 ppg Yield: 1.15 cu ft/sk Great Bear Petroleum Great Bear Project Great Bear Plan Merak #1 Merak #1 ( • Plan: Merak #1 WP8.0 I Standard Proposal Report 23 July, 2012 HALLIBURTON Sperry Drilling Services HALL. IURTON F NCE INFORMATION Co-ordinate(N/E)Reference: Well Plan Merak#1,True North Vertical(ND)Reference: Updated 7/23 @ 198.40usft(KBE@175.1+RIG@ 23.3) Sperry Drilling Measured Depth Reference: Updated 7/23 @ 198.40usft(KBE@175.1+RIG@ 23.3) ACalculation Method: Minimum Curvature Great Bear Petroleum LLC --- SURVEY PROGRAM CASING DETAILS Date:2012-07-23T00:00:00 Validated:Yes Version: ND MD Name Size 2500.00 2500.00 13 3/8" 13-3/8 Depth From Depth To Survey/Plan Tool 8560.00 8560.00 9 5/8" 9-5/8 198.40 2500.00 Merak#1 WP8.0((Merak#1)) MWD R2 11447.99 11447.99 8 1/2 OH 8-1/2 2500.00 8650.00 Merak#1 WP8.0(Merak#1) MWD R2 8650.00 11448.00 Merak#1 WP8.0 Merak#1)) MWD R2 COMPANY DETAILS: Great Bear Petroleum Calculation Method: Minimum Curvature WELL DETAILS: Plan Merak#1 Error System: ISCWSA - _-- Scan Method: Tray.Cylinder North Ground Level: 23.30 Error Surface: Elliptical Conic +N/-S +E/-W Northing Easting Latittude Longitude Slot Warning Method: Error Ratio 0.00 0.00 5839740.78 661411.16 69°58'7.378 N 148°42'48.268 W SECTION DETAILS Project: Great Bear Project Sec MD Inc Azi ND +NI-S +E/-W Dleg TFace VSect Target Site: Great Bear 1 198.40 0.00 0.00 198.40 0.00 0.00 0.00 0.00 0.00 Well: Plan Merak#1 2 200.00 0.00 0.00 200.00 0.00 0.00 0.00 0.00 0.00 3 400.00 0.00 0.00 400.00 0.00 0.00 0.00 0.00 0.00 Wellbore: Merak#1 4 600.00 0.00 0.00 600.00 0.00 0.00 0.00 0.00 0.00 5 800.00 0.00 0.00 800.00 0.00 0.00 0.00 0.00 0.00 Merak#1 WP8.0 6 1000.00 0.00 0.00 1000.00 0.00 0.00 0.00 0.00 0.00 7 1200.00 0.00 0.00 1200.00 0.00 0.00 0.00 0.00 0.00 8 1400.00 0.00 0.00 1400.00 0.00 0.00 0.00 0.00 0.00 9 1600.00 0.00 0.00 1600.00 0.00 0.00 0.00 0.00 0.00 Vertical Section at 0.00° (2000 usft/in) 10 1800.00 0.00 0.00 1800.00 0.00 0.00 0.00 0.00 0.00 11 2000.00 0.00 0.00 2000.00 0.00 0.00 0.00 0.00 0.00 -4000 -3000 -2000 -1000 0 1000 2000 12 2200.00 0.00 0.00 2200.00 0.00 0.00 0.00 0.00 0.00 13 2400.00 0.00 0.00 2400.00 0.00 0.00 0.00 0.00 0.00 -1000 1 i 1 i i i i i i I i i i i _l 1.I i i i 1 -1000 14 2600.00 0.00 0.00 2600.00 0.00 0.00 0.00 0.00 0.00 _ _ 15 2800.00 0.00 0.00 2800.00 0.00 0.00 0.00 0.00 0.00 16 3000.00 0.00 0.00 3000.00 0.00 0.00 0.00 0.00 0.00 17 3200.00 0.00 0.00 3200.00 0.00 0.00 0.00 0.00 0.00 18 3400.00 0.00 0.00 3400.00 0.00 0.00 0.00 0.00 0.00 - W - 19 3600.00 0.00 0.00 3600.00 0.00 0.00 0.00 0.00 0.00 0- -0 20 3800.00 0.00 0.00 3800.00 0.00 0.00 0.00 0.00 0.00 21 4000.00 0.00 0.00 4000.00 0.00 0.00 0.00 0.00 0.00 22 4200.00 0.00 0.00 4200.00 0.00 0.00 0.00 0.00 0.00 - 23 4400.00 0.00 0.00 4400.00 0.00 0.00 0.00 0.00 0.00 - - 24 4600.00 0.00 0.00 4600.00 0.00 0.00 0.00 0.00 0.00 - - 25 4800.00 0.00 0.00 4800.00 0.00 0.00 0.00 0.00 0.00 1000- -1000 26 5000.00 0.00 0.00 5000.00 0.00 0.00 0.00 0.00 0.00 Permafrost 27 5200.00 0.00 0.00 5200.00 0.00 0.00 0.00 0.00 0.00 28 5400.00 0.00 0.00 5400.00 0.00 0.00 0.00 0.00 0.00 - - 29 5600.00 0.00 0.00 5600.00 0.00 0.00 0.00 0.00 0.00 - 30 5800.00 0.00 0.00 5800.00 0.00 0.00 0.00 0.00 0.00 - 31 6000.00 0.00 0.00 6000.00 0.00 0.00 0.00 0.00 0.00 2000-- .--2000 32 6200.00 0.00 0.00 6200.00 0.00 0.00 0.00 0.00 0.00 13 3/8" - 33 6400.00 0.00 0.00 6400.00 0.00 0.00 0.00 0.00 0.00 34 6600.00 0.00 0.00 6600.00 0.00 0.00 0.00 0.00 0.00 - 35 6800.00 0.00 0.00 6800.00 0.00 0.00 0.00 0.00 0.00 - - 36 7000.00 0.00 0.00 7000.00 0.00 0.00 0.00 0.00 0.00 - 37 7200.00 0.00 0.00 7200.00 0.00 0.00 0.00 0.00 0.00 3000 ---3000 38 7400.00 0.00 0.00 7400.00 0.00 0.00 0.00 0.00 0.00 39 7600.00 0.00 0.00 7600.00 0.00 0.00 0.00 x..0.00 0.00 40 7800.00 0.00 0.00 7800.00 0.00 0.00 0.00 0.00 0.00 41 8000.00 0.00 0.00 8000.00 0.00 0.00 0.00 0.00 0.00 42 8200.00 0.00 0.00 8200.00 0.00 0.00 0.00 0.00 0.00 43 8400.00 0.00 0.00 8400.00 0.00 0.00 0.00 0.00 0.00 c 7-7I 44 8600.00 0.00 0.00 8600.00 0.00 0.00 0.00 0.00 0.00 w 4000 4000 c45 8800.00 0.00 0.00 8800.00 0.00 0.00 0.00 0.00 0.00 CD cri 46 9000.00 0.00 0.00 9000.00 0.00 0.00 0.00 0.00 0.00 47 9200.00 0.00 0.00 9200.00 0.00 0.00 0.00 0.00 0.00 o - ,,,< 48 9400.00 0.00 0.00 9400.00 0.00 0.00 0.00 0.00 0.00 049 9600.00 0.00 0.00 9600.00 0.00 0.00 0.00 0.00 0.00 0 5000 -I -- 5000 ii 50 9800.00 0.00 0.00 9800.00 0.00 0.00 0.00 0.00 0.00 51 10000.00 0.00 0.0010000.00 0.00 0.00 0.00 0.00 0.00 c 0 52 10200.00 0.00 0.0010200.00 0.00 0.00 0.00 0.00 0.00 Ci_. - Canninga 53 10400.00 0.00 0.0010400.00 0.00 0.00 0.00 0.00 0.00 to 54 10600.00 0.00 0.0010600.00 0.00 0.00 0.00 0.00 0.00 _ 55 10800.00 0.00 0.0010800.00 0.00 0.00 0.00 0.00 0.00 6000 -- 6000 Iv 56 11000.00 0.00 0.00 11000.00 0.00 0.00 0.00 0.00 0.00 To - O 57 11200.00 0.00 0.00 11200.00 0.00 0.00 0.00 0.00 0.00 O 58 11400.00 0.00 0.00 11400.00 0.00 0.00 0.00 0.00 0.00 at - O 59 11448.00 0.00 0.0011448.00 0.00 0.00 0.00 0.00 0.00 ca - 2 7000 Seabee --7000 I- - - - West(-)/East(+)(150 usft/in) 9 5/8" Hue -75 0 75 8000 Base HRZ HRZ -- 8000 l i ' i l i ' ' i l i ' ' ' l l i ' 1 LCU - - - Top Lwr Kingak(K-1) - c 0 9000- _ c 9000 75' _75 g - Base Lwr Kingak(K-1) o� -_ 2 _ Imo, _ 10000-- Top Shublik -10000 E 0- 9 5/8" it 13 3/8" -0 +� - o_ I Base Shublik Merak#1 WP8.0 c I 8 1/2 0H 11000 - -11000 ;-75- --75 5 Ivishak 8 1/2 OH __� - n - Merak#1 WP8.0 - Total Depth: 11448.49'MD,11446'TVD _ _ _ 12000 -T i i i I i I I I I i I I I I I I I I I I I I I I I I I I 12000 I I I I I 1 I I I I I I I I I I I I i -4000 -3000 -2000 -1000 0 1000 2000 -75 0 75 Vertical Section at 0.00°(2000 usft/in) West(-)/East(+)(150 usft/in) HALLIBURTON Standard Proposal Report Database: EDM 5000.1 Single User Db Local Co-ordinate Reference: Well Plan Merak#1 Company: Great Bear Petroleum TVD Reference: Updated 7/23 @ 198.40usft(KBE@175.1+RIG@ 23. Project: Great Bear Project MD Reference: Updated 7/23 @ 198.40usft(KBE@175.1+RIG@ 23. Site: Great Bear North Reference: True • Well: Plan Merak#1 Survey Calculation Method: Minimum Curvature Wellbore: Merak#1 Design: Merak#1 WP8.0 Project Great Bear Project Map System: US State Plane 1927(Exact solution) ' System Datum: Mean Sea Level Geo Datum: NAD 1927(NADCON CONUS) • Using Well Reference Point Map Zone: Alaska Zone 04 • Using geodetic scale factor Site Great Bear Site Position: Northing: 5,847,611.30 usft Latitude: 69°59'23.898 N From: Map Easting: 665,578.34 usft Longitude: 148°40'43.837 W Position Uncertainty: 0.00 usft Slot Radius: 13-3/16" Grid Convergence: 1.24 ° Well Plan Merak#1 Well Position +N/-S 0.00 usft Northing: 5,839,740.78 usft • Latitude: 69°58'7.378 N +El-W 0.00 usft Easting: 661,411.16 usft , Longitude: 148°42'48.268 W' Position Uncertainty 0.00 usft Wellhead Elevation: usft Ground Level: . 23.30 usft Wellbore Merak#1 Magnetics Model Name Sample Date Declination Dip Angle Field Strength l°) (°I (nT) BGGM2011 8/15/2012 20.75 80.81 57.625 Design Merak#1 WP8.0 Audit Notes: Version: Phase: PLAN Tie On Depth: 198.40 Vertical Section: Depth From(TVD) +N/-S +E/-W Direction I (usft) (usft) (usft) (°) 198.40 0.00 0.00 0.00 7/23/2012 5:39:42PM Page 2 COMPASS 5000.1 Build 61 HALLIBLiRTOIV Standard Proposal Report Database: EDM 5000.1 Single User Db Local Co-ordinate Reference: Well Plan Merak#1 Company: Great Bear Petroleum TVD Reference: Updated 7/23 @ 198.40usft(KBE©175.1+RIG@ 23. Project: Great Bear Project MD Reference: Updated 7/23 @ 198.40usft(KBE@175.1+RIG@ 23. Site: Great Bear North Reference: True Well: Plan Merak#1 Survey Calculation Method: Minimum Curvature Wellbore: Merak#1 Design: Merak#1 WP8.0 Plan Sections Measured Vertical TVD Dogleg Build Turn Depth Inclination Azimuth Depth System +N/-S +E/-W Rate Rate Rate Tool Face (usft) (°) (') (usft) usft (usft) (usft) (/1OOusft) ('/1OOusft) (11OOusft) (°) 198.40 0.00 0.00 198.40 0.00 0.00 0.00 0.00 0.00 0.00 0.00 200.00 0.00 0.00 200.00 1.60 0.00 0.00 0.00 0.00 0.00 0.00 400.00 0.00 0,00 400.00 201.60 0.00 0.00 0.00 0.00 0.00 0.00 600.00 0.00 0.00 600.00 401.60 0.00 0.00 0.00 0.00 0.00 0.00 800.00 0.00 0.00 800.00 601.60 0.00 0.00 0.00 0.00 0.00 0.00 1,000.00 0.00 0.00 1,000.00 801.60 0.00 0.00 0.00 0.00 0.00 0.00 1,200.00 0.00 0.00 1,200.00 1,001.60 0.00 0.00 0.00 0.00 0.00 0.00 1,400.00 0.00 0.00 1,400.00 1,201.60 0.00 0.00 0.00 0.00 0.00 0.00 1,600.00 0.00 0.00 1,600.00 1,401.60 0.00 0.00 0.00 0.00 0.00 0.00 1,800.00 0.00 0.00 1,800.00 1,601.60 0.00 0.00 0.00 0.00 0.00 0.00 2,000.00 0.00 0.00 2,000.00 1,801.60 0.00 0.00 0.00 0.00 0.00 0.00 2,200.00 0.00 0.00 2,200.00 2,001.60 0.00 0.00 0.00 0.00 0.00 0.00 2,400.00 0.00 0.00 2,400.00 2,201.60 0.00 0.00 0.00 0.00 0.00 0.00 2,600.00 0.00 0.00 2,600.00 2,401.60 0.00 0.00 0.00 0.00 0.00 0.00 2,800.00 0.00 0.00 2,800.00 2,601.60 0.00 0.00 0.00 0.00 0.00 0.00 3,000.00 0.00 0.00 3,000.00 2,801.60 0.00 0.00 0.00 0.00 0.00 0.00 3,200.00 0.00 0.00 3,200.00 3,001.60 0.00 0.00 0.00 0.00 0.00 0.00 3,400.00 0.00 0.00 3,400.00 3,201.60 0.00 0.00 0.00 0.00 0.00 0.00 3,600.00 0.00 0.00 3,600.00 3,401.60 0.00 0.00 0.00 0.00 0.00 0.00 3,800.00 0.00 0.00 3,800.00 3,601.60 0.00 0.00 0.00 0.00 0.00 0.00 4,000.00 0.00 0.00 4,000.00 3,801.60 0.00 0.00 0.00 0.00 0.00 0.00 4,200.00 0.00 0.00 4,200.00 4,001.60 0.00 0.00 0.00 0.00 0.00 0.00 4,400.00 0.00 0.00 4,400.00 4,201.60 0.00 0.00 0.00 0.00 0.00 0.00 4,600.00 0.00 0.00 4,600.00 4,401.60 0.00 0.00 0.00 0.00 0.00 0.00 4,800.00 0.00 0.00 4,800.00 4,601.60 0.00 0.00 0.00 0.00 0.00 0.00 5,000.00 0.00 0.00 5,000.00 4,801.60 0.00 0.00 0.00 0.00 0.00 0.00 5,200.00 0.00 0.00 5,200.00 5,001.60 0.00 0.00 0.00 0.00 0.00 0.00 5,400.00 0.00 0.00 5,400.00 5,201.60 0.00 0.00 0.00 0.00 0.00 0.00 5,600.00 0.00 0.00 5,600.00 5,401.60 0.00 0.00 0.00 0.00 0.00 0.00 5,800.00 0.00 0.00 5,800.00 5,601.60 0.00 0.00 0.00 0.00 0.00 0.00 6,000.00 0.00 0.00 6,000.00 5,801.60 0.00 0.00 0.00 0.00 0.00 0.00 6,200.00 0.00 0.00 6,200.00 6,001.60 0.00 0.00 0.00 0.00 0.00 0.00 6,400.00 0.00 0.00 6,400.00 6,201.60 0.00 0.00 0.00 0.00 0.00 0.00 6,600.00 0.00 0.00 6,600.00 6,401.60 0.00 0.00 0.00 0.00 0.00 0.00 6,800.00 0.00 0.00 6,800.00 6,601.60 0.00 0.00 0.00 0.00 0.00 0.00 7,000.00 0.00 0.00 7,000.00 6,801.60 0.00 0.00 0.00 0.00 0.00 0.00 7,200.00 0.00 0.00 7,200.00 7,001.60 0.00 0.00 0.00 0.00 0.00 0.00 7,400.00 0.00 0.00 7,400.00 7,201.60 0.00 0.00 0.00 0.00 0.00 0.00 7,600.00 0.00 0.00 7,600.00 7,401.60 0.00 0.00 0.00 0.00 0.00 0.00 7,800.00 0.00 0.00 7,800.00 7,601.60 0.00 0.00 0.00 0.00 0.00 0.00 8,000.00 0.00 0.00 8,000.00 7,801.60 0.00 0.00 0.00 0.00 0.00 0.00 8,200.00 0.00 0.00 8,200.00 8,001.60 0.00 0.00 0.00 0.00 0.00 0.00 8,400.00 0.00 0.00 8,400.00 8,201.60 0.00 0.00 0.00 0.00 0.00 0.00 8,600.00 0.00 0.00 8,600.00 8,401.60 0.00 0.00 0.00 0.00 0.00 0.00 8,800.00 0.00 0.00 8,800.00 8,601.60 0.00 0.00 0.00 0.00 0.00 0.00 9,000.00 0.00 0.00 9,000.00 8,801.60 0.00 0.00 0.00 0.00 0.00 0.00 9,200.00 0.00 0.00 9,200.00 9,001.60 0.00 0.00 0.00 0.00 0.00 0.00 9,400.00 0.00 0.00 9,400.00 9,201.60 0.00 0.00 0.00 0.00 0.00 0.00 7/23/2012 5.39:42PM Page 3 COMPASS 5000.1 Build 61 IIALLIBURTOIV Standard Proposal Report Database: EDM 5000.1 Single User Db Local Co-ordinate Reference: Well Plan Merak#1 Company: Great Bear Petroleum TVD Reference: Updated 7/23 @ 198.40usft(KBE©175.1 +RIG@ 23. Project: Great Bear Project MD Reference: Updated 7/23 @ 198.40usft(KBE@175.1 +RIG@ 23. Site: Great Bear North Reference: True Well: Plan Merak#1 Survey Calculation Method: Minimum Curvature Wellbore: Merak#1 Design: Merak#1 WP8.0 9,600.00 0.00 0.00 9,600.00 9,401.60 0.00 0.00 0.00 0.00 0.00 0.00 9,800.00 0.00 0.00 9,800.00 9,601.60 0.00 0.00 0.00 0.00 0.00 0.00 10,000.00 0.00 0.00 10,000.00 9,801.60 0.00 0.00 0.00 0.00 0.00 0.00 10,200.00 0.00 0.00 10,200.00 10,001.60 0.00 0.00 0.00 0.00 0.00 0.00 10,400.00 0.00 0.00 10,400.00 10,201.60 0.00 0.00 0.00 0.00 0.00 0.00 10,600.00 0.00 0.00 10,600.00 10,401.60 0.00 0.00 0.00 0.00 0.00 0.00 10,800.00 0.00 0.00 10,800.00 10,601.60 0.00 0.00 0.00 0.00 0.00 0.00 11,000.00 0.00 0.00 11,000.00 10,801.60 0.00 0.00 0.00 0.00 0.00 0.00 11,200.00 0.00 0.00 11,200.00 11,001.60 0.00 0.00 0.00 0.00 0.00 0.00 11,400.00 0.00 0.00 11,400.00 11,201.60 0.00 0.00 0.00 0.00 0.00 0.00 11,448.00 0,00 0.00 11,448.00 11,249.60 0.00 0.00 0.00 0.00 0.00 0.00 7/23/2012 5:39:42PM Page 4 COMPASS 5000.1 Build 61 HALLIBI.IRTON Standard Proposal Report Database: EDM 5000.1 Single User Db Local Co-ordinate Reference: Well Plan Merak#1 Company: Great Bear Petroleum TVD Reference: Updated 7/23 @ 198.40usft(KBE@175.1+RIG@ 23. Project: Great Bear Project MD Reference: Updated 7/23 @ 198.40usft(KBE@175.1+RIG@ 23. Site: Great Bear North Reference: True Well: Plan Merak#1 Survey Calculation Method: Minimum Curvature Wellbore: Merak#1 Design: Merak#1 WP8.0 Planned Survey i Measured Vertical Map Map Depth Inclination Azimuth Depth TVDss +NI-S +E/-W Northing Fasting DLS Vert Section (usft) (^) (') (usft) usft (usft) (usft) (usft) (usft) 0.00 198.40 0.00 0.00 198.40 0.00 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 200.00 0.00 0.00 200.00 -1.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 300.00 0.00 0.00 300.00 -101.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 400.00 0.00 0.00 400.00 -201.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 ' 500.00 0.00 0.00 500.00 -301.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 600.00 0.00 0.00 600.00 -401.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 700.00 0.00 0.00 700.00 -501.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 800.00 0.00 0.00 800.00 -601.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 900.00 0.00 0.00 900.00 -701.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 1,000.00 0.00 0.00 1,000.00 -801.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 1,067.80 0.00 0.00 1,067.80 -869.40 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 Permafrost 1,100.00 0.00 0.00 1,100.00 -901.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 1,200.00 0.00 0.00 1,200.00 -1,001.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 1,300.00 0.00 0.00 1,300.00 -1,101.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 1,400.00 0.00 0.00 1.400.00 -1,201.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 I 1,500.00 0.00 0.00 1,500.00 -1,301.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 1,600.00 0.00 0.00 1,600.00 -1,401.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 1,700.00 0.00 0.00 1,700.00 -1,501.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 1,800.00 0.00 0.00 1,800.00 -1,601.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 1,900.00 0.00 0.00 1,900.00 -1,701.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 2,000.00 0.00 0.00 2,000.00 -1,801.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 2,100.00 0.00 0.00 2,100.00 -1,901.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 2,200.00 0.00 0.00 2,200.00 -2,001.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 2,300.00 0.00 0.00 2,300.00 -2,101.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 2,400.00 0.00 0,00 2,400.00 -2,201.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 2,500.00 0.00 0.00 2,500.00 -2,301.60 0.00 0.00 5,839,740,78 661,411.16 0.00 0.00 13 3/8" 2,600.00 0.00 0.00 2,600.00 -2,401.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 2,700.00 0.00 0.00 2,700.00 -2,501.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0,00 2,800.00 0.00 0.00 2,800.00 -2,601.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 2,900.00 0.00 0.00 2,900.00 -2,701,60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 3,000.00 0.00 0.00 3,000.00 -2,801.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 3,100.00 0.00 0.00 3,100.00 -2,901.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 3,200.00 0.00 0.00 3,200.00 -3,001.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 3,300.00 0.00 0.00 3,300.00 -3,101.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 3,400.00 0.00 0.00 3,400.00 -3.201.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 3,500.00 0.00 0.00 3,500.00 -3,301.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 3,600.00 0.00 0.00 3,600.00 -3,401.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 3,700.00 0.00 0.00 3,700.00 -3,501.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 3,800.00 0.00 0.00 3,800.00 -3,601.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 3,900.00 0.00 0.00 3,900.00 -3,701.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 4,000.00 0.00 0.00 4,000.00 -3,801.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 4,100.00 0.00 0.00 4,100.00 -3,901.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 4,200.00 0.00 0.00 4,200.00 -4,001.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 7/23/2012 5:39•42PM Page 5 COMPASS 5000.1 Build 61 I-IALLIBURTONi Standard Proposal Report Database: EDM 5000.1 Single User Db Local Co-ordinate Reference: Well Plan Merak#1 Company: Great Bear Petroleum TVD Reference: Updated 7/23 @ 198.40usft(KBE@175.1 +RIG@ 23. Project: Great Bear Project MD Reference: Updated 7/23 @ 198.40usft(KBE@175.1+RIG@ 23. Site: Great Bear North Reference: True Well: Plan Merak#1 Survey Calculation Method: Minimum Curvature Wellbore: Merak#1 Design: Merak#1 WP8.0 Planned Survey Measured Vertical Map Map Depth Inclination Azimuth Depth TVDss +N/-S +E/-W Northing Easting DLS Vert Section (usft) (°) (°) (usft) usft (usft) (usft) (usft) (usft) -4,101.60 4,300.00 0.00 0.00 4,300.00 -4,101.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 4,400.00 0.00 0.00 4,400.00 -4,201.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 4,500.00 0.00 0.00 4,500.00 -4,301.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 4,600.00 0.00 0.00 4,600.00 -4,401.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 4,700.00 0.00 0.00 4,700.00 -4,501.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 4,800.00 0.00 0.00 4,800.00 -4,601.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 4,900.00 0.00 0.00 4,900.00 -4,701.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 5,000.00 0.00 0.00 5,000.00 -4,801.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 5,053.80 0.00 0.00 5,053.80 -4,855.40 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 Canning 5,100.00 0.00 0.00 5,100.00 -4,901.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 5,200.00 0.00 0.00 5,200.00 -5,001.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 5,300.00 0.00 0.00 5,300.00 -5,101.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 5,400.00 0.00 0.00 5,400.00 -5,201.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 5,500.00 0.00 0.00 5,500.00 -5,301.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 5,600.00 0.00 0.00 5,600.00 -5,401.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 5,700.00 0.00 0.00 5,700.00 -5,501.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 5,800.00 0.00 0.00 5,800.00 -5,601.60 0.00 0.00 5,839.740.78 661,411.16 0.00 0.00 5,900.00 0.00 0.00 5,900.00 -5,701.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 6,000.00 0.00 0.00 6,000.00 -5,801.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 6,100.00 0.00 0.00 6,100.00 -5,901.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 6,200.00 0.00 0.00 6,200.00 -6,001.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 6,300.00 0.00 0.00 6,300.00 -6,101.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 6,400.00 0.00 0.00 6,400.00 -6,201.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 6,500.00 0.00 0.00 6,500.00 -6,301.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 6,600.00 0.00 0.00 6,600.00 -6,401.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 6,700.00 0.00 0.00 6,700.00 -6,501.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 6,800.00 0.00 0.00 6,800.00 -6,601.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 6,900.00 0.00 0.00 6,900.00 -6,701.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 7,000.00 0.00 0.00 7,000.00 -6,801.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 7,100.00 0.00 0.00 7,100.00 -6,901.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 7,200.00 0.00 0.00 7,200.00 -7,001.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 7,294.80 0.00 0.00 7,294.80 -7,096.40 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 Seabee 7,300.00 0.00 0.00 7,300.00 -7,101.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 7,400.00 0.00 0.00 7,400.00 -7,201.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 1 7,500.00 0.00 0.00 7,500.00 -7,301.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 7,600.00 0.00 0.00 7,600.00 -7,401.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 7,700.00 0.00 0.00 7,700.00 -7,501.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 7,800.00 0.00 0.00 7,800.00 -7,601.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 7,900.00 0.00 0.00 7,900.00 -7,701.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 8,000.00 0.00 0.00 8,000.00 -7,801.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 8,100.00 0.00 0.00 8,100.00 -7,901.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 8,200.00 0.00 0.00 8,200.00 -8,001.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 8,300.00 0.00 0.00 8,300.00 -8,101.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 7/23/2012 5:39.42PM Page 6 COMPASS 5000 1 Build 61 HALLIBURiDri Standard Proposal Report Database: EDM 5000.1 Single User Db Local Co-ordinate Reference: Well Plan Merak#1 Company: Great Bear Petroleum TVD Reference: Updated 7/23 @ 198.40usft(KBE@175.1+RIG@ 23. Project: Great Bear Project MD Reference: Updated 7/23 @ 198.40usft(KBE@175.1 +RIG@ 23. Site: Great Bear North Reference: True Well: Plan Merak#1 Survey Calculation Method: Minimum Curvature Wellbore: Merak#1 Design: Merak#1 WP8.0 Planned Survey � Measured Vertical Map Map Depth Inclination Azimuth Depth TVDss +N/-S +El-W Northing Easting DLS Vert Section (usft) (°) (°) (usft) usft (usft) (usft) (usft) (usft) -8,201.60 8,400.00 0.00 0.00 8,400.00 -8,201.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 8,404.80 0.00 0.00 8,404.80 -8,206.40 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 Hue 8,500.00 0.00 0.00 8,500.00 -8,301.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 8,560.00 0.00 0.00 8,560.00 -8,361.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 9 5/8" 8,600.00 0.00 0.00 8,600.00 -8,401.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 8,643.80 0.00 0.00 8,643.80 -8,445.40 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 HRZ 8,700.00 0.00 0.00 8,700.00 -8,501.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 8,800.00 0.00 0.00 8.800.00 -8,601.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 8,893.80 0.00 0.00 8,893.80 -8,695.40 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 Base HRZ-LCU 8,900.00 0.00 0.00 8,900.00 -8,701.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 9,000.00 0.00 0.00 9,000.00 -8,801.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 9,100.00 0.00 0.00 9,100.00 -8,901.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 9,200.00 0.00 0.00 9,200.00 -9,001.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 9,300.00 0.00 0.00 9,300.00 -9,101.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 9,400.00 0.00 0.00 9,400.00 -9,201.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 9,500.00 0.00 0.00 9,500.00 -9,301.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 9,600.00 0.00 0.00 9,600.00 -9,401.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 9,700.00 0.00 0.00 9,700.00 -9,501.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 9,800.00 0.00 0.00 9,800.00 -9,601.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 9,900.00 0.00 0.00 9,900.00 -9,701.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 10,000.00 0.00 0.00 10,000.00 -9,801.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 10,100.00 0.00 0.00 10,100.00 -9,901.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 10,200.00 0.00 0.00 10,200.00 -10,001.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 10,300.00 0.00 0.00 10,300.00 -10,101.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 10,318.80 0.00 0.00 10,318.80 -10,120.40 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 Top Lwr Kingak(K-1) 10,400.00 0.00 0.00 10,400.00 -10,201.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 10,500.00 0.00 0.00 10,500.00 -10,301.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 10,543.80 0.00 0.00 10,543.80 -10,345.40 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 I Base Lwr Kingak(K-1)-Top Shublik 10.600.00 0.00 0.00 10,600.00 -10,401.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 10,643.80 0.00 0.00 10,643.80 -10,445.40 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 Base Shublik-Ivishak 10,700.00 0.00 0.00 10,700.00 -10,501.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 10,800.00 0.00 0.00 10,800.00 -10,601.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 • 10,900.00 0.00 0.00 10,900.00 -10,701.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 11,000.00 0.00 0.00 11,000.00 -10.801.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 11,100.00 0.00 0.00 11,100.00 -10,901.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 11,200.00 0.00 0.00 11,200.00 -11,001.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 11,300.00 0.00 0.00 11,300.00 -11,101.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 11,400.00 0.00 0.00 11,400.00 -11,201.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 7/23/2012 5:39:42PM Page 7 COMPASS 5000.1 Build 61 11ALLI B U RTO NI Standard Proposal Report Database: EDM 5000.1 Single User Db Local Co-ordinate Reference: Well Plan Merak#1 Company: Great Bear Petroleum TVD Reference: Updated 7/23 @ 198.40usft(KBE@175.1 +RIG@ 23. Project: Great Bear Project MD Reference: Updated 7/23 @ 198.40usft(KBE@175.1 +RIG@ 23. Site: Great Bear North Reference: True Well: Plan Merak#1 Survey Calculation Method: Minimum Curvature Wellbore: Merak#1 Design: Merak#1 WP8.0 Planned Survey I Measured Vertical Map Map Depth Inclination Azimuth Depth TVDss +N/-S +E/-W Northing Easting DLS Vert Section (usft) (°) (°) (usft) usft (usft) (usft) (usft) (usft) -11,249.59 11,447.99 0.00 0.00 11,447.99 -11,249.59 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 8 1/2 OH 11,448.00 0.00 0.00 11,448.00 -11,249.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 Total Depth:11448.49'MD,11446'TVD Casing Points Measured Vertical Casing Hole Depth Depth Diameter Diameter (usft) (usft) Name (") (") 8,560.00 8,560.00 9 5/8" 9-5/8 12-1/4 2,500.00 2,500.00 13 3/8" 13-3/8 17-1/2 11,447.99 11,447.99 8 1/2 OH 8-1/2 8-1/2 Formations Measured Vertical Vertical Dip Depth Depth Depth SS Dip Direction (usft) (usft) Name Lithology (°) (°) 10,543.80 10,543.80 Base Lwr Kingak(K-1) 8,893.80 8,893.80 LCU 10,543.80 10,543.80 Top Shublik 8,404.80 8,404.80 Hue 10,643.80 10,643.80 Ivishak 7,294.80 7,294.80 Seabee 10,643.80 10,643.80 Base Shublik 10,318.80 10,318.80 Top Lwr Kingak(K-1) 8,893.80 8,893.80 Base HRZ 8,643.80 8,643.80 HRZ 1,067.80 1,067.80 Permafrost 5,053.80 5,053.80 Canning Plan Annotations Measured Vertical Local Coordinates Depth Depth +N/-S +E/-W (usft) (usft) (usft) (usft) Comment 11,448.00 11 448.00 0.00 0.00 Total Depth 11448.49'MD. 11446'TVD 7/23/2012 5:39:42PM Page& COMPASS 5000.1 Build 61 Z w °o F- L m ai IX 13,1• c c ME J J > QL L m = a M W a E 7 c o d p U 22 d 42 W oI co O y w O w d X d • O as CC r O 2 O ` Z N O • cu E 65• r w O II IIIM CO O T 06 N Y Lo u.; 2 L O T Q A+ V TOu L W - w L 0 �`p 4000 G) 7 R t0 LL SIM — 0Ua Z ° y d Q cr • 'L o w O + E m N 00 = N J CD Iv � ia < " D1r 0� L oa &)- 1:0 Wa L 0 • N r .5O ct O VN = c CU 0 C W % o m (-DJ N L r r a) L O z . :; .. o w M mCI" It A! • N a`r a •c t m o a) a� E Y Y D C V �J �+ • 0 E c o n `o a s L 0 C) i . 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O U !. 0 co i - • t •0 f0 d 0 o �n o io N o o LI) u> co o Q▪ Q U ^ o C O CO O N N O <h co I d (u!/ og•Z) ao�oed uoueJedag Q U Great Bear Petroleum Great Bear Project Great Bear Plan Merak #1 Merak #1 ST1 is Plan: Merak #1 ST1 WP8.0 Standard Proposal Report 23 July, 2012 HALLIBURTON Sperry Drilling Services HALL 3URTON F NCE INFORMATION lilt Co-ordinate(N/E)Reference: Well Plan Merak#1,True North Vertical(TVD)Reference: Updated 7/23 @ 198.40usft(KBE@175.1+RIG@ 23.3) Sperry Drilling Measured Depth Reference: Updated 7/23 @ 198.40usft(KBE@175.1+RIG@ 23.3) Calculation Method: Minimum Curvature Great Bear Petroleum LLC SURVEY PROGRAM CASING DETAILS Date:2012-07-23700:00:00 Validated:Yes Version: TVD MD Name Size 2500.00 2500.00 13 3/8" 13-3/8 Depth From Depth To Survey/Plan Tool 8560.00 8560.00 9 5/8" 9-5/8 198.40 2500.00 Merak#1 WP8.0 Merak#1 MWD R2 10544.00 10938.66 7" 7 2500.00 8650.00 Merak#1 WP8.0 Merak#1 MWD R2 10593.72 14277.43 4 1/2' 4-1/2 8650.00 9230.00 Merak#1 WP8.0 Merak#1 MWD R2 9230.00 9580.00 Merak#1 ST1 WP8.0{Merak#1 ST1)) MWD Interp Azi COMPANY DETAILS: Great Bear Petroleum R 9580.00 10938.66 Merak#1 ST1 WP8.0 Merak#1 ST1) MWD- 2 10938.66 14277.44 Merak#1 ST1 WP8.0 Merak#1 ST1)) MWD R2 Calculation Method: Minimum Curvature WELL DETAILS: Plan Merak#1 Error System: ISCWSA Scan Method: Tray.Cylinder North Ground Level: 23.30 Error Surface: Elliptical Conic +N/-S +EI-W Northing Easting Latittude Longitude Slot Warning Method: Error Ratio 0.00 0.00 5839740.78 661411.16 69°58'7.378 N 148°42'48.268 W SECTION DETAILS Project: Great Bear Project Sec MD Inc Azi ND +N/-S +E/-W Oleg TFace VSect Target Site: Great Bear 1 9230.00 0.00 0.00 9230.00 0.00 0.00 0.00 0.00 0.00 2 10467.19 49.49 120.00 10319.00 -250.95 434.65 4.00 120.00 501.89 Well: Plan Merak#1 3 11277.44 90.00 120.0010593.72 -623.15 1079.32 5.00 0.00 1246.29 Wellbore: Merak#1 STI 4 14277.44 90.00 120.00 10593.72-2123.17 3677.38 0.00 0.00 4246.29 Merak#1 ST1 WP8.0 ( West(-)/East(+)(900 usft/in) 1 -450 0 450 900 1350 1800 2250 2700 3150 3600 4050 4500 4950 5400 I I I I I I I I I I I i i 1 i I i i I 1 I i I I i i I I I I 11 I I I I I I i I I I I I I I I I I I I I I I I I I I I I 1 450- -450 i - Merak#1 WP8.0 0- - Start Dir 4°/100':9230'MD,9230'TVD: 120°RT TF 0 - 13 3/8 - - - Start Dir 5°/100': 10467.19'MD,10319'TVD -450- --450 9 5/8" - End Dir : 11277.44'MD,10593.72'TVD - a -900- --900 rn - o 7., z- 8 - - -1350- --1350 + - - 5 C - Total Depth: 14277.44'MD, 10593.72'TVD - o _ -1800- --1800 0 E o CID - - 4 1/2" 'e - - -2250- --2250 - Merak#1 STI WP8.0 - -2700- ----2700 -3150- -3150 IIIIIIIIIIIIIIII I IIIIIIIIII IIIIIII III II II I I I [ I I I I I 1 1 1 1 I 1 mil t I I t -450 0 450 900 1350 1800 2250 2700 3150 3600 4050 4500 4950 5400 West(-)/East(+)(900 usft/in) HALLJURTON F NCE INFORMATION V% Co-ordinate(N/E)Reference: Well Plan Merak#1,True North Vertical(TVD)Reference: Updated 7/23 @ 198.40usft(KBE@175.1+RIG@ 23.3) Sperry Drilling Measured Depth Reference: Updated 7/23 @ 198.40usft(KBE@175.1+RIG@ 23.3) Calculation Method: Minimum Curvature Great sear Petroleum LLC SURVEY PROGRAM CASING DETAILS Date:2012-07-23T00:00:00 Validated:Yes Version: TVD MD Name Size 2500.00 2500.00 13 3/8" 13-3/8 Depth From Depth To Survey/Plan Tool 8560.00 8560.00 9 5/8" 9-5/8 198.40 2500.00 Merak#1 WP8.0(Merak#1 MWD R2 10544.00 10938.66 7" 7 2500.00 8650.00 Merak#1 WP8.0(Merak#1 MWD R2 10593.72 14277.43 4 1/2" 4-1/2 8650.00 9230.00 Merak#1 WP8.0(Merak#1 MWD R2 9230.00 9580.00 Merak#1 ST1 WP8.0 Merak#1 ST1 MWD Intern Azi COMPANY DETAILS: Great Bear Petroleum 9580.00 10938.66 Merak#1 ST1 WP8.0 Merak#1 ST1 MWD R2 _ 10938.66 14277.44 Merak#1 ST1 WP8.0 Merak#1 ST1 MWD R2 Calculation Method: Minimum Curvature WELL DETAILS: Plan Merak#1 Error System: ISCWSA I I Scan Method: Tray.Cylinder North Ground Level: 23.30 Error Surface: Elliptical Conic +N/-S +E/-W Northing Fasting Latittude Longitude Slot Warning Method: Error Ratio 1 0.00 0.00 5839740.78 661411.16 69°58'7.378 N 148°42'48.268 W SECTION DETAILS Project: Great Bear Project Sec MD Inc Azi TVD +N/-S +EI-W Dleg TFace VSect Target Site: Great Bear 1 9230.00 0.00 0.00 9230.00 0.00 0.00 0.00 0.00 0.00 Well: Plan Merak#1 2 10467.19 49.49 120.00 10319.00 -250.95 434.65 4.00 120.00 501.89 3 11277.44 90.00 120.00 10593.72 -623.15 1079.32 5.00 0.00 1246.29 Wellbore: Merak#1 ST1 4 14277.44 90.00 120.00 10593.72-2123.17 3677.38 0.00 0.00 4246.29 Merak#1 ST1 WP8.0 Vertical Section at 120.00°(2000 usft/in) -3000 -2000 -1000 0 1000 2000 3000 4000 5000 6000 7000 8000 9000 10000 -1000 iiIIIIIIIIiiiiliiiiliiiiliiiilIJIIIiiitliiilIiit , Li , riiIIIIIiiii -1000 0- A ,,,,,,„,.,T,: i} ,,,,,4144.,,,,,,,..„„,„,.„.„ .„;,,, ,,v,,.. ,, .„.,,,„..,...„.„,,,,,,, _ _0 , 1.4,3:,!,.., ,,,.,„:44,41,,,,„ ‘,..40,..„ . _ :^iV fi , v K' +Y'„': - o-' - 1000- ,, ,: . .. . -1000 2000- 13 3/8" -2000 AL - 3000- -3000 c - - -1 4000 - -4000 c v) - m L - G 00 L f s- m I. N 5000--S l�t /�� -5000 w L p m p c0 6000 -6000 N 0 f 0 0 > - - c CL) m 2 7000-- --7000 I- - _ 8000- 9 5/8 -- 8000 JI, - Start Dir 4°/100':9230'MD,9230'TVD:120°RT TF _ 9000-- -9000 Start Dir 5°/100':10467.19'MD,10319'TVD - - Top Lwr Kingak(K-1) - 10000- End Dir :11277.44'MD,10593.72'TVD -10000 ✓ 7" - - Base Lwr Kingak(K-1) --v I Total Depth:14277.44'MD,10593.72'TVD - 11000- --- 11000 Base Shublik Top Shublik Merak#1 WP8.0 Ivishak 4 1/2" - - Merak:#1 ST1 WP8.0 IIIIIIIIIIIIIIIIIIIIII I I I I I I I I I I l I i i I I I I I I l I I I I I I I I I�I 'r 1 1 l i l l l l l l i l 12000 -3000 -2000 -1000 0 1000 2000 3000 4000 5000 6000 7000 8000 9000 10000 Vertical Section at 120.00°(2000 usft/in) HALLI B Li RTD I J Standard Proposal Report Database: EDM 5000.1 Single User Db Local Co-ordinate Reference: Well Plan Merak#1 Company: Great Bear Petroleum TVD Reference: Updated 7/23 @ 198.40usft(KBE@175.1 +RIG@ 23. Project: Great Bear Project MD Reference: Updated 7/23 @ 198.40usft(KBE@175.1 +RIG@ 23. Site: Great Bear North Reference: True Well: Plan Merak#1 Survey Calculation Method: Minimum Curvature Wellbore: Merak#1 ST1 Design: Merak#1 ST1 WP8.0 Project Great Bear Project Map System: US State Plane 1927(Exact solution) System Datum: Mean Sea Level Geo Datum: NAD 1927(NADCON CONUS) Using Well Reference Point Map Zone: Alaska Zone 04 Using geodetic scale factor Site Great Bear Site Position: Northing: 5,847,611.30 usft Latitude: 69°59'23.898 N From: Map Easting: 665,578.34 usft Longitude: 148°40'43.837 W Position Uncertainty: 0.00 usft Slot Radius: 13-3/16" Grid Convergence: 1.24 ° Well Plan Merak#1 Well Position +N/-S 0.00 usft Northing: 5,839,740.78 usft Latitude: 69°58'7.378 N +E/-W 0.00 usft Easting: 661,411.16 usft Longitude: 148°42'48.268 W Position Uncertainty 0.00 usft Wellhead Elevation: usft Ground Level: 23.30 usft Wellbore Merak#1 ST1 Magnetics Model Name Sample Date Declination Dip Angle Field Strength ' (°) (°) (nT) BGGM2011 6/10/2012 20.85 80.80 57.627 Design Merak#1 ST1 WP8.0 Audit Notes: Version: Phase: PLAN Tie On Depth: 9,230.00 Vertical Section: Depth From(TVD) +N/-S +E/-W Direction (usft) (usft) (usft) (°) 1 198.40 0.00 0.00 120.00 Plan Sections Measured Vertical TVD Dogleg Build Turn Depth Inclination Azimuth Depth System +N/-S +E/-W Rate Rate Rate Tool Face (usft) (°) (°) (usft) usft (usft) (usft) (°/100usft) (°/100usft) ("l100usft) (°) 9,230.00 0.00 0.00 9,230.00 9,031.60 0.00 0.00 0.00 0.00 0.00 0.00 10,467.19 49.49 120.00 10,319.00 10,120.60 -250.95 434.65 4.00 4.00 0.00 120.00 11,277.44 90.00 120.00 10,593.72 10,395.32 -623.15 1,079.32 5.00 5.00 0.00 0.00 14,277.44 90.00 120.00 10,593.72 10,395.32 -2,123.17 3,677.38 0.00 0.00 0.00 0.00 7/23/2012 5:45:26PM Page 2 COMPASS 5000.1 Build 61 HALLIBURTONI Standard Proposal Report Database: EDM 5000.1 Single User Db Local Co-ordinate Reference: Well Plan Merak#1 Company: Great Bear Petroleum TVD Reference: Updated 7/23 @ 198.40usft(KBE@175.1 +RIG@ 23. Project: Great Bear Project MD Reference: Updated 7/23 @ 198.40usft(KBE@175.1 +RIG@ 23. Site: Great Bear North Reference: True Well: Plan Merak#1 Survey Calculation Method: Minimum Curvature Wellbore: Merak#1 ST1 Design: Merak#1 ST1 WP8.0 Planned Survey Measured Vertical Map Map Depth Inclination Azimuth Depth TVDss +N/-S +E/-W Northing Easting DLS Vert Section (usft) (°) (0) (usft) usft (usft) (usft) (usft) (usft) -9,031.60 9,230.00 0.00 0.00 9,230.00 -9,031.60 0.00 0.00 5,839,740.78 661,411.16 0.00 0.00 Start Dir 4°/100':9230'MD,9230'TVD:120°RT TF 9,300.00 2.80 120.00 9,299.97 -9,101.57 -0.86 1.48 5,839,739.96 661,412.66 4.00 1.71 9,400.00 6.80 120.00 9,399.60 -9.201.20 -5.04 8.73 5,839,735.93 661,419.99 4.00 10.08 9,500.00 10.80 120.00 9,498.40 -9,300.00 -12.69 21.97 5,839,728.56 661,433.39 4.00 25.37 9,600.00 14.80 120.00 9,595.90 -9,397.50 -23.76 41.16 5,839,717.89 661,452.80 4.00 47.52 9,700.00 18.80 120.00 9,691.61 -9,493.21 -38.21 66.18 5,839,703.98 661,478.13 4.00 76.42 9,800.00 22.80 120.00 9,785.08 -9,586.68 -55.96 96.93 5,839,686.88 661,509.24 4.00 111.92 9,900.00 26.80 120.00 9,875.83 -9,677.43 -76.93 133.25 5,839,666.68 661,545.99 4.00 153.86 10,000.00 30.80 120.00 9,963.45 -9,765.05 -101.01 174.96 5,839,643.49 661,588.20 4.00 202.03 10,100.00 34.80 120.00 10,047.49 -9,849.09 -128.09 221.86 5,839,617.41 661,635.66 4.00 256.18 10,200.00 38.80 120.00 10,127.54 -9,929.14 -158.04 273.73 5,839,588.56 661,688.14 4.00 316.08 10,300.00 42.80 120.00 10,203.23 -10,004.83 -190.70 330.31 5,839,557.10 661,745.39 4.00 381.40 10,400.00 46.80 120.00 10,274.17 -10,075.77 -225.93 391.32 5,839,523.17 661,807.13 4.00 451.85 10,466.88 49.48 120.00 10,318.80 -10.120.40 -250.83 434.45 5,839,499.19 661,850.77 4.00 501.66 Top Lwr Kingak(K-1) 10,467.19 49.49 120.00 10,319.00 -10,120.60 -250.95 434.65 5,839,499.08 661,850.98 4.00 501.89 Start Dir 5°/100':10467.19'MD,10319'TVD 10,500.00 51.13 120.00 10,339.95 -10,141.55 -263.57 456.52 5,839,486.92 661,873.10 5.00 527.14 10,600.00 56.13 120.00 10,399.24 -10,200.84 -303.82 526.22 5,839,448.15 661,943.64 5.00 607.63 10,700.00 61.13 120.00 10,451.28 -10,252.88 -346.49 600.14 5,839,407.05 662,018.44 5.00 692.99 10,800.00 66.13 120.00 10,495.69 -10,297.29 -391.28 677.71 5,839,363.92 662,096.92 5.00 782.55 10,900.00 71.13 120.00 10,532.12 -10,333.72 -437.82 758.33 5,839,319.08 662,178.50 5.00 875.64 10,937.97 73.03 120,00 10,543.80 -10,345.40 -455.89 789.62 5,839,301.68 662,210.16 5.00 911.77 Base Lwr Kingak(K-1)-Top Shublik 10,938.66 73.06 120.00 10,544.00 -10,345.60 -456.21 790.18 5,839,301.37 662,210.74 5.00 912.43 7" 11,000.00 76.13 120.00 10,560.29 -10,361.89 -485.78 841.39 5,839,272.89 662,262.55 5.00 971.56 11,100,00 81.13 120.00 10,580.01 -10,381.61 -534.78 926.27 5,839,225.69 662,348.44 5.00 1,069.56 11,200.00 86.13 120.00 10,591.10 -10,392.70 -584.46 1,012.31 5,839,177.85 662,435.50 5.00 1,168.92 11,277.44 90.00 120.00 10,593.72 -10,395.32 -623.15 1,079.32 5,839,140.58 662,503.31 5.00 1,246.30 End Dir :11277.44'MD,10593.72'TVD 11,300.00 90.00 120.00 10,593.72 -10,395.32 -634.43 1,098.86 5,839,129.71 662,523.08 0.00 1,268.86 11,400.00 90.00 120.00 10,593.72 -10,395.32 -684.43 1,185.46 5,839,081.55 662,610.71 0.00 1,368.86 11,500.00 90.00 120.00 10,593.72 -10.395.32 -734.43 1,272.06 5,839,033.40 662,698.34 0.00 1,468.86 11,600.00 90.00 120.00 10,593.72 -10,395.32 -784.43 1,358.67 5,838,985.24 662,785.98 0.00 1,568.86 11,700.00 90.00 120.00 10,593.72 -10,395.32 -834.43 1,445.27 5,838,937.08 662,873.61 0.00 1,668.86 11,800.00 90.00 120.00 10,593.72 -10,395.32 -884.44 1,531.87 5,838,888.92 662,961.24 0.00 1,768.86 11,900.00 90.00 120.00 10,593.72 -10,395.32 -934.44 1,618.47 5,838,840.76 663,048.87 0.00 1,868.86 12,000.00 90.00 120.00 10,593.72 -10,395.32 -984.44 1,705.07 5,838,792.60 663,136.50 0.00 1,968.86 12,100.00 90.00 120.00 10,593.72 -10,395.32 -1,034.44 1,791.68 5,838,744.44 663,224.13 0.00 2,068.86 12,200.00 90.00 120.00 10,593.72 -10,395.32 -1,084.44 1,878.28 5,838,696.28 663,311.76 0.00 2,168.86 12,300.00 90.00 120.00 10,593.72 -10,395.32 -1,134.44 1,964.88 5,838,648.12 663,399.40 0.00 2,268.86 12,400.00 90.00 120.00 10,593.72 -10,395.32 -1,184.44 2,051.48 5,838,599.96 663,487.03 0.00 2,368.86 12,500.00 90.00 120.00 10,593.72 -10,395.32 -1,234.44 2,138,08 5,838,551.80 663,574.66 0.00 2,468.86 7/23/2012 5:45:26PM Page 3 COMPASS 5000,1 Build 61 I-IALLIBURI DNi Standard Proposal Report Database: EDM 5000.1 Single User Db Local Co-ordinate Reference: Well Plan Merak#1 Company: Great Bear Petroleum TVD Reference: Updated 7/23 @ 198.40usft(KBE@175.1 +RIG@ 23. Project: Great Bear Project MD Reference: Updated 7/23 @ 198.40usft(KBE@175.1+RIG@ 23. Site: Great Bear North Reference: True Well: Plan Merak#1 Survey Calculation Method: Minimum Curvature Wellbore: Merak#1 ST1 Design: Merak#1 ST1 WP8.0 Planned Survey Measured Vertical Map Map Depth Inclination Azimuth Depth TVDss +N/-S +E/-W Northing Easting DLS Vert Section (usft) (°) (°) (usft) usft (usft) (usft) (usft) (usft) -10,395.32 12,600.00 90.00 120.00 10,593.72 -10,395.32 -1,284.44 2,224.69 5,838,503.64 663,662.29 0.00 2,568.86 12,700.00 90.00 120.00 10,593.72 -10,395.32 -1,334.44 2,311.29 5,838,455.48 663,749.92 0.00 2,668.86 12,800.00 90.00 120.00 10,593.72 -10,395.32 -1,384.44 2,397.89 5,838,407.32 663,637.55 0.00 2,768.86 12,900.00 90.00 120.00 10,593.72 -10,395.32 -1,434.44 2,484.49 5,838,359.17 663,925.18 0.00 2,868.86 13,000.00 90.00 120.00 10,593.72 -10,395.32 -1,484.45 2,571.09 5,838,311.01 664,012.82 0.00 2,968.86 13,100.00 90.00 120.00 10,593.72 -10,395.32 -1,534.45 2,657.70 5,838,262.85 664,100.45 0.00 3,068.86 13,200.00 90.00 120.00 10,593.72 -10,395.32 -1,584.45 2,744.30 5,638,214.69 664,188.08 0.00 3,168.86 13,300.00 90.00 120.00 10,593.72 -10,395.32 -1,634.45 2,830.90 5,838,166.53 664,275.71 0.00 3,268.86 13,400.00 90.00 120.00 10,593.72 -10,395.32 -1,684.45 2,917.50 5,838,118.37 664,363.34 0.00 3,368.86 13,500.00 90.00 120.00 10,593.72 -10,395.32 -1,734.45 3,004.11 5,838,070.21 664,450.97 0.00 3,468.86 13,600.00 90.00 120.00 10,593.72 -10,395.32 -1,784.45 3,090.71 5,838,022.05 664,538.60 0.00 3,568.86 13,700.00 90.00 120.00 10,593.72 -10,395.32 -1,834.45 3,177.31 5,637,973.89 664,626.24 0.00 3,668.86 13,800.00 90.00 120.00 10,593.72 -10,395.32 -1,884.45 3,263.91 5,837,925.73 664,713.87 0.00 3,768.86 13,900.00 90.00 120.00 10,593.72 -10,395.32 -1,934.45 3,350.51 5,837,877.57 664,801.50 0.00 3,868.86 14,000.00 90.00 120.00 10,593.72 -10,395.32 -1,984.45 3,437.12 5,837,829.41 664,889.13 0.00 3,968.86 14,100.00 90.00 120.00 10,593.72 -10,395.32 -2,034.45 3,523.72 5,837,781.25 664,976.76 0.00 4,068.86 14,200.00 90.00 120.00 10,593.72 -10,395.32 -2,084.45 3,610.32 5,837,733.09 665,064.39 0.00 4,168.86 14,277.43 90.00 120.00 10,593.72 -10,395.32 -2,123.17 3,677.38 5,837,695.80 665,132.25 0.00 4,246.29 4 1/2" . 14.277.44 90.00 120.00 10,593.72• -10,395.32 -2,123.17 3,677.38 5,837,695.80 665,132.25 0.00 4,246.29 Total Depth:14277.44'MD,10593.72'TVD Casing Points Measured Vertical Casing Hole Depth Depth Diameter Diameter (usft) (usft) Name (") ("1 2,500.00 2,500.00 13 3/8" 13-3/8 17-1/2 8,560.00 8,560.00 9 5/8" 9-5/8 12-1/4 10,938.66 10,544.00 7" 7 8-1/2 14,277.43 10,593.72 4 1/2" 4-1/2 6-1/8 Formations Measured Vertical Vertical Dip Depth Depth Depth SS Dip Direction (usft) _ (usft) Name t. Lithology (°) (°) 8,893.80 8,893.60 Base HRZ 8,643.80 8,643.80 HRZ 8,893.80 8,893.80 LCU 8,404.80 8,404.80 Hue 10,937.97 10,543.80 Base Lwr Kingak(K-1) 7,294.80 7,294.80 Seabee 10,466.88 10,318.80 Top Lwr Kingak(K-1) 10,937.97 10,543.80 Top Shublik 7/23/2012 5:45:26PM Page 4 COMPASS 5000.1 Build 61 I-IALLIBURTON Standard Proposal Report Database: EDM 5000.1 Single User Db Local Co-ordinate Reference: Well Plan Merak#1 Company: Great Bear Petroleum TVD Reference: Updated 7/23 @ 198.40usft(KBE@175.1+RIG@ 23. ). Project: Great Bear Project MD Reference: Updated 7/23 @ 198.40usft(KBE@175.1+RIG@ 23.'' Site: Great Bear North Reference: True Well: Plan Merak#1 Survey Calculation Method: Minimum Curvature Wellbore: Merak#1 ST1 Design: Merak#1 ST1 WP8.0 Plan Annotations Measured Vertical Local Coordinates Depth Depth +N/-S +E/-W (usft) (usft) (usft) (usft) Comment 9,230.00 9,230.00 0.00 0.00 Start Dir 4°/100':9230'MD,9230'TVD:120°RT TF 10,467.19 10,319.00 -250.95 434.65 Start Dir 5°/100':10467.19'MD,10319'TVD 11,277.44 10,593.72 -623.15 1,079.32 End Dir :11277.44'MD,10593.72'TVD 14,277.44 10,593.72 -2,123.17 3,677.38 Total Depth:14277.44'MD,10593.72'TVD 7/23/2012 5 45 26PM Page 5 COMPASS 5000.1 Build 61 za) o3 H L mL J 13 J t QL 'al T ■fes I a E m a O a 92 � o a en U c0 co O • O W O • r X °w it a A o CC' Y o E co r 2ZN P Z U _ N C W ■— as O 7• u W c t N I, p Y 76 Sim II NM a) ` N � �/ • W co. 7 « a m m Q U y m aLu o 0. 0 = c CV 0 O C J O C 0 GO co ` d L. 00 N a Z• a d Q Imo, /p��` n V � CUwVw, C ^\ •. 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V 0 to - JN LL i l l i i 1 1 1 1 1 1 1 I 1 1 I I I 1 i r I 1 1 1 1 1 1 1 1 I I I 11 I Til O m mil 0 0) V O N N- O N N O N N- O N ,_ O N O N O Ls) C A O 00 f� O N (") N O I4 CO (u!/ Os.Z) JoTaed uo!T8Jedas Q U Analysis of Seismic Data for Shallow Hazards Great Bear Petroleum Operating LLC Merak#1 The following section contains an examination of 3-D seismic lines run through and near the Merak#1 drilling location for potential shallow hazards there. The attached seismic display is available electronically in high resolution PDF format and will be transmitted to the Commission upon request. The Preliminary Migration Processing Flow and Display Parameters Summary are included to provide answers to questions posed by the Commission during the earlier review of similar seismic data for the currently drilling Alcor#1 well. Note that the Merak#1 well location is located at the intersection of Inline 1248 and Crossline 383. These lines are included in the attached line displays along with others that straddle them. The eastern boundary of seismic data acquisition is marked by the Sag River. While the proposed Merak#1 lies in close proximity to the river, it is located on the west side and in the area of high quality seismic data. Based on the nearby Alcor#1 well (now drilling), the base permafrost depth is at approximately 1,025' BGL which is 200-250 ms subsurface on the displays. Note that the red-colored interval on the first Velan example is a product of the high data quality at that time (depth). 700 ms is approximately 3,000' subsurface using a 9,000 ft/sec velocity(as suggested from the Vlan). It can be seen from the gather to the right of the Velan display that reflection continuity is very good at 700 ms which provides statistically similar coherent velocity picks. Great Bear believes the nearby well data(contained in the section following this seismic discussion) and this location-specific 3-D data support the interpretation that there is no well or seismic evidence suggesting accumulated gas or elevated pressures at or shallower than 3,000' BGL. 1 ; I ",1 IL • Air ,_101 . . r j N. ,Ir i CS ^L W 0 S Cn m c L. r co CU z CC cuW j\ Ni COa H Q. No 0 co O , ell •__ IL)c\I.) 1 E v til .„, i 0 O 1.1w •- CLO m 0) To hi� 0To— Eo ^ U : • . lC 0 cv a) C oC N m ° r? a) m o g O T a) cmL 0 a) ~ •" C N O N CC Q f` ►— hi o `° o 0 i •V 0) -NC N 0) cii > FF. - U) d 12 Il ' I- CI •- .z N to E ;Iy cop it N u + I ea 0 V) U 0. U U U U 0 c X ,. d a) ° D �n co M a� arn� eon 0) z_ o T E O S_ Co U a) (0 to 11') L T O C N C 01 C U) v) tf) a 0 L it) a) F- a) .0 E RI Z' X a) c0 CI) tn ? o p n . O >. 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I lh i DC rn —CD ' 1 ,t/r fli 0821 - : : 1 c -I Z9ZT U ili 44ZT 1f III , CO Oil f 1 L ,' , �,1i'$,i 1," I , II FI •._ 9ZZT if i 'Pii.I,ii)ii m B0Z T - N M a) 06TT X 1 , C '- .L 43 ti , , s , p s 4 h ; ko 6 M C x p ""c, C , _ '_ _ C. _ -1 n N . 1 � *CV:A? F. vel (IT. '-'--.>i t f ti'r, ,''+ woo * ��APi '1 1 ylir A Vc Al H ----c -- ---- - Cl.) c c , 0 - . CU0 C .... U v) 'zzl' co _ r-i CD 0 c6 0 OC � Ol C ,--1 C c � 4- c r-1 o IrE: . t/'f ,,,i Y "_ CD o 1- C, . > �G. • c ,L r C ; ,, l (0 CIn ~ N 7 •,',441-MT r..A. 01 4 C C". L wr �► 1 }• t r G q I 1 I I '-,—+-� i.:)itis H c c c CO p -c U co p 7 O CO CU c J O !""I Et' (00 C C—+ Xc, v c c- t Q I c- c_ c V c r c_ r 0 Offset Well Review For Great Bear Petroleum Operating LLC Merak#1 Existing wells near the proposed Great Bear Alcor#1 have been reviewed to identify potential hazards in the surface hole interval and to identify the shallowest occurrence of hydrocarbons in each of the offset wells. Existing wells reviewed include: Pipeline State#1 (187-121) Kadleroshilik Unit#1 (173-040) Sequoia#1 (191-136) N. Franklin Bluffs Unit#1 (172-031) Franklin Bluffs(205-105) Jacob's Ladder(206-152) Lake 79 Fed (169-056) Hemi Springs Unit#3 (085-022) Hemi Springs Sag River#1 (184-007) Toolik Federal#2(168-096) Wolfbutton 25-6-9 (088-143) Alcor#1 (212-057) These wells' locations relative to the Merak#1 are indicated on the attached map. The two Franklin Bluffs wells are very shallow and yielded no deep information. The N. Franklin Bluffs Unit#1 well file contains no mud weight information. However,those two wells are included here due to their proximity to the Alcor#1 and for the shallow data they yield. The AOGCC's well files for the Toolik Federal#1 contain no mud weight information but otherwise yielded usable casing and drilling information. Included in this Offset Well Review are the following: • Offset Well Operational Summaries • Offset Well Problem Summary Spreadsheet • Alcor#1Drilling Risks Discussion • Offset Well Casing and Cementing Spreadsheet • Offset Well Mud Weight vs Depth Curves • Merak#1 Planned Mud Weight vs Depth Curve lin T.alj. E'Z r I �r , �, .,.) • ,, y • r EiL�CLTMI id a0, r_( 4 �1i � S*' y a Jj '� Cr t. r(�'J0w0e 1 I' wU 1. ay �y VAlte r' Oar; 4ckt t,,1 ' .v 4. L C iI ',1 4, �i., } ,� _ r� ttoS‘, ' A. tr .0 1- ..y I I 4': i .ai , A EO . S IL a('4. = M Ai W WKA. ?'.1 ' ,, �0/' ,k , 4�1 z, ,. •. 7�r er, A lAdt :* 1=3-171:11t1ITI ::"°.;:fie.1 r :i4.,, ,. ,, a "",.t „ . GS�GMf 1 '.R ip' ,, Q Offset Well Operational Summaries Summary of findings: There was no evidence of gas in any of the surface holes examined,other than 4 to 5 units of background gas recorded on Alcor#1 below 2000' MD. No kicks in surface holes were reported. Mud weights varied from 8.8 ppg to 10.5 ppg. Most of the wells experienced trouble in cementing casing to surface,primarily due to long open hole exposure before running casing. Surface hole casing setting depths varied from 1,228 ft(Kadleroshilik Unit#1)to 4,580 ft(Hemi Springs#3). The average surface casing setting depth for all the offsets studied is 2,581'. J Alcor#1 recorded a gas spike of 62 units in a coal layer at 3570'MD. Hemi Springs#3 recorded the first gas shows on the mud log at 3,600 ft. Sequoia#1 encountered the first gas show between 4,380 and 4,512 ft. Alcor#1 (212-057)Great Bear Petroleum Operating LLC,is currently drilling below 7"casing. 16"conductor set at 80 ft. 12 %"surface hole drilled with 10.0— 10.2 ppg mud weight. 9 5/8"casing was set at 2,491' and cemented to surface with 443 bbls lead and 50 bbls tail cement. 7"casing was set at 8,311' MD to isolate lost circulation zones above the HRZ. Alcor#1 has cored the HRZ and is currently drilling to the Kingak core point. Pipeline State#1 (187-121)was drilled by Arco in 1988 to a depth of 10,360 ft. 16"Conductor at 115 ft 12 %"surface hole drilled with 9.5 ppg mud weight. 9 5/8"casing set at 3,832 ft. 12.5 ppg FIT Pumped 2.7 times calculated volume but cement did not reach surface. Performed top job. At 9530 ft(300 ft above Hue Shale) 10.1 ppg mud was cut to 8.0 ppg and was stabilized with 10.4 ppg. Lost circulation in GRZ/Pebble Shale with 10.5 ppg mud. P&A well. Kadleroshilik Unit#1 (173-040)was drilled by Mobil in 1974 to a depth of 4,566 ft. 20"Conductor at 65 ft 17 %2"hole to 325 ft drilled with unknown mud weight. 13 3/8"casing set at 308 ft. 12 '/"hole drilled to 1,260 ft with lost circ. reported at 451 ft. No mud weights given. Ran logs and side wall cores. Ran 9 5/8"casing to 1,228 ft and cemented without returns. Drilled 8 %i"hole to 3,565 ft,ran logs and side wall cores. Drilled ahead to TD at 4,566 ft. Ran logs and side wall cores. Plug back open hole to 3,460 ft. Ran 7"casing to 2,294 ft. Could not circulate 7". Perf 7"above float collar and squeezed cement without returns. Ran two DST's with no fluid to surface. Abandoned well. Sequoia#1 (191-136)was drilled by Conoco in 1988 to a depth of 8,910 ft. 20"Conductor at 135 ft. 16"hole drilled to 2,500 ft with unknown mud weight. Ran logs and side wall cores. 13 3/8"casing to 2,500 ft. Cemented with 3 times calculated volume without surface returns. Performed top job. Drilled out and conducted LOT to 14.5 ppg EMW. Drilled 9 7/8"hole to 8,910 ft. Mud log indicated gas show between 4,380 and 4,512 ft. No further shows were seen until well flow was detected between 8,663 and 8,692(LCU). Flow was / ___., _ , i , , _.._ , controlled by weighting up to 10.4 ppg. Drilling continued with losses and swabbing. Logs were run and the well was abandoned. Franklin Bluffs Unit#1 (172-031)was drilled was drilled by Arco in 1973 to a depth of 3,500 ft. 13 3/8"Conductor at 92 ft. 12 %"hole was drilled to 1,710 ft and logs were run. Mud weight unknown. 9 5/8"casing was run to 1,710 and cemented with returns to surface. FIT to 12.5 ppg. 8 1/2"hole was drilled to TD at 3,500 ft and logged. Well was abandoned. Franklin Bluffs(205-105)was drilled by the BLM in 2005 to a depth of 1,818 ft. 10 5/8"Conductor at 8 ft. Drilled 9 7/8"hole to 76 ft and cemented 6 5/8"casing. Drilled and cored with unknown bit size to 1,818 ft. Mud weight ranged from 8.9 to 9.5 ppg. Twist-off occurred at 428 ft while drilling at 1,818 ft. Fishing unsuccessful. Abandoned well. The BLM was in search of coal or coal gas. No gas shows were reported. Jacob's Ladder(206-152) was drilled by Anadarko. The well reached 11,437 ft in the 2007 season and continued to 14,415 ft in the 2008 season. 20"Conductor set at 110 ft. 16"hole was drilled to 3,442 with 8.7 to 9.5 ppg mud weight. Tight hole from 2,776 to 3,412 ft. 13 3/8"casing cemented with 5.3 times calculated volume with no cement to surface. Performed two top jobs. Rig freeze-up problems contributed to delays and cementing difficulties. Drilled out of 13 3/8"with 12 %"bit and ran FIT to 12.5 ppg EMW. Drilled to top Kavik, logged well and ran and cemented 9 5/8"casing to 11,005 MD, 10,988 TVD. Mud weight in 12 %"hole was 9.6 ppg. Drilled shoe and ran FIT to 13.4 ppg EMW. Drilled into Lisburne to MD of 11,437 ft. Open hole was plugged and well suspended for season. In 2008 well was re-entered for further Lisburne testing. Well was abandoned on 4/10/08. Lake 79 Fed(169-056)was drilled by Shell in 1969 to a depth of 15,540 ft. 30"Conductor at 57 ft. 20"casing at 280 ft. 12 1/4"hole drilled to 2,295 ft then opened to 17 %". Mud weight 9.2 to 9.9 ppg with no report of gas, flow or losses. Ran 13 3/8"casing to 2,282 and cemented. Opened DV tool at 1,528 ft and pumped 5.4 times calculated volume of cement needed without getting cement to surface. Performed top job in 13 3/8"x 20"annulus. 12 1/"hole was drilled to 11,093 ft with 10.0 ppg mud. Logged well and ran 9 5/8"casing to 11,077 ft. Drilled 8 '/2"hole to 12,884 ft and ran logs. Continued drilling 8 1/2"hole with 10.1 ppg mud to 14,917 ft with 9.7 to 10.0 ppg mud. Made one core run, logged well and resumed drilling to TD at 15,544 ft MD. Logged well. Abandoned well on Oct. 22, 1969. No report of flow or losses on this well. Hemi Springs Unit#3 was drilled by Arco in 1985 to a depth of 10,059 ft as a test of the Kuuparuk. 16"Conductor at 80 ft. 12 '/"hole was drilled with 9.2 -9.4 ppg mud to 4600 ft.. Surface hole was logged and 9 5/8" casing run and cemented to 4580 ft. Cemented with 1300 sks Permafrost E+300 sks Class G. Performed top job with 100 sks Permafrost C. Drilled out and performed LOT to 12.0 ppg. 8 'h"hole was drilled with WBM. Initial mud weight of 9.0 ppg was used to a depth of 6772 ft. Mud weight was increased to 9.9 ppg by 7718 ft then to 10.6 ppg when coring began at 8567 ft. By 9505 ft the mud weight was increased to 11.2 ppg to control shale. Well was abandoned. The mud log on Hemi Springs#3 shows no sign of gas until a very small show appeared at 3600 ft. Gas shows began to increase below 8000 ft. Coring of the Kuparuk formation began at 8570'. Toolik Federal#1 was drilled by Arco in 1969 to a depth of 10,814'. 20"conductor set at 108 ft and cemented with 175 sks Fondu cement. Returns to surface. A 20"diverter was installed on the 20"casing. 13-3/8"set at 1,565 ft and cemented in 3 steps: Stage 1: 1100 sks Class G Stage 2: 860 sks Fondu via DV tool(no surface returns) Stage 3: Top job with 130 sks Fondu The 17-1/2"surface was planned to go to 2,500 ft but hole problems and stuck pipe caused casing to be set early. BOP's were installed on the 13-3/8"casing. 9-5/8"casing was set at 3,552 ft due to sticky hole. This casing had been planned for 10,000 ft. 9-5/8"was cemented with 1500 sks Class G with no surface cement returns. 8 'h"hole was drilled and cored to 10,814'. First"show"on mud log was at 5,990-6,000 ft. Reports say that"no commercial accumulations of hydrocarbons were encountered". AOGCC visited on March 26, 1969 while drilling at 9,438 ft. Operator reported that the well had experienced no lost circulation and no abnormal pressure. The only mud weight given was 11.1 ppg just prior to the P&A. Well was P&A'd April 15, 1969. Toolik Federal#2 was drilled by Arco in 1969 to a depth of 8,700'. 13-3/8"conductor set in 17-1/2"hole at 88' and cemented with 70 sks Fondu-FlyAsh cement. Returns to surface. N/U BOPE on 13-3/8". 9-5/8"casing was set in 12-1/4"hole at 818' and cemented with 240 sks Fondu-FlyAsh with no returns to surface. Pumped 10 sk top job. 7"casing was set in 8-3/4"hole at 2,190' and cemented with 300 sks Fondu and 200 sks Fondu-FlyAsh. Good returns to surface. Well was drilled to TD with 6-3/4"bits. Well was logged with wireline then abandoned. Woltbutton 25-6-9 was drilled by Texaco in 1989. 20"Conductor was set at 109' and cemented with 5 yds. Permafrost cement. 17-1/4"hole was drilled to 2,500 ft and logged. (no mud weight given) 13-3/8"casing was run to 2,477 and cemented with 2604 cu ft Permafrost cement. Performed 96 cu ft top job with Permafrost cement. Drilled 12 %"hole to 2,500 ft and ran LOT to 12.6 ppg EMW. (8.9 ppg mud w/490 psi surface) ' Drilled 12 1/"hole to 10,057' where mud was cut to 9.3 ppg. Drilled to 10,215 while increasing mud weight to 10.7 ppg where losses began. Reduced weight to 10.6 ppg and drilled to TD at 10,241'. Well was logged and P&A. Merak#1 Offset Well Problem Summary Pipeline State#1 Kadleroshilik Unit#1 Sequoia#1 Jacob's Ladder No cement to surface in surface hole No cement to surface in surface hole No cement to surface in surface hole No cement to surface in surface hole Total pumped 3.0X calculated vol Total pumped 7.5X calculated vol Total pumped 3.1X calculated vol Total pumped 8X calculated vol (5 days spent from spud to cementing) (5 days spent from spud to cementing) (3 days spent from spud to cementing) (12 days spent from spud to cementing) Gas cut mud just above Hue Shale Lost circ/kick/swabbing/deteriorating hole Lost circ/kick/swabbing/deteriorating hole in GRZ/Pebble Shale @ 10,360'(10.5 ppg in Kingak Shale @ 8,910'(10.6 ppg mud) mud) Lost circ while P&A-ing well(thief zone Lost circ at 451'(MW unknown) above 9,390') (10.5 ppg mud) Lost circ at 2,294'(MW unknown) Well flowed at 8,692'(MW<10.4) Tight hole 2,776'-3,412' Tight hole 14,416',lost BHA,ST well Lake 79 Federal#1 Hemi Springs#3 Toolik Federal#1 Sloughing hole and stuck pipe in surface hole. No cement to surface in surface hole No cement to surface in surface hole No cement to surface in surface hole Total pumped 5.7X calculated vol Total pumped 2.2X calculated vol Total pumped 2.1X calculated vol days spent from spud to cementing) (4 days spent from spud to cementing) days spent from spud to cementirn. Sloughing hole f/surf csg shoe to 3.560' Raised MW f/10.6 ppg at 8,567'to 11.2 ppg at 9,505'to control shale. Stuck pipe twice below 9,671'. Stuck DP at 8,359' A B 8 �06,� pr ? 2-1Z-—1°I 8 eoRE 7-1/16"10,000 PSI 6BX lbA I 6• ---- 1-13/16"10,000 PSI 01/ i \ !r .■ _ : oe° ! ;;•r r�lt!' 1 #11:03 � o° ; ;.1 26.25 o ovo , - t , A ii ,,&A ta ...�.. SECONDARY PACKOFF t 11"10000 PSI 6BX IIIIIIIIIII 1-13/16"10,000 PSI 29.3r 7"SUP TYPE CASING HANGER— sokOP ,_. �"` ���e.• illi. ' 5 66.89" ■ 5 Nii-it '_I e - - SECONDARY PACKOFF 1 9-5/8"PACKOFF D41! t ....1111111111111 13-5/8"5.000 PSI 68X 1 ,461.11111111111111. 4 ., '_ s t 9-5/8"FLUTED CASING HANGER d -- 2-1/16"5,000 PSI 28 63" I II ii 1 i 6 1111, 4. ......„, . 10 , s,,- ttriM •fill° 13-3/8"QUICK DISCONNECT ilf M OS OM ------13-3113"FLUTED CASING HANGER 2.44" tim I1TIIGRING 22 I 13-3/8"OD CSG 9-5/8"OD CSG i - INSTAII 7-I/16' 10 000 PSI 7'OD CSG TUBING HFAD ASSFM811 vetcogra LAYOUT/ SWE STEP21 I, 10120102-20 ING w Ism0 a w 11 NORTH PietNSG 46" I __----- 250' EVENT Q RADIUS / '.\ / / 0 APPROXIMATE EDGE OF PAD `, / / 1 \ .' t�\\ICii�v 20' \ t• tf� 100 LF Ill'° NABORS ' DIVERTER « 0 i / :® • RIG 105E Stir.,u> :v" / \ / 20'0 � \1::.' ``. 6,. IS \, WELL � y, CENTER / 20' / `: / /\ © 20' \\ N. / ,, � , Q - - EDGE OF PAD SURVEY CONTROL COORDINATE POINTS © EDGE OF PAD COORDINATES 27 Easting Northing1 661,418.0 5,839,862.0 2 661,569.0 5,839,731.0 s 661,331.0 5,839,436.0 Merak #'1 4 661,227.0 5,839,524.0 5 661,161.0 5,839,544.0 6 661,187.0 5,839,636.0 7 661,338.0 5,839,806.0 Survey Datum Referenced is NAD 27 Well Center 661,402.66 5,839,719.08 Pad Layout for Merak #1 Drilling Operations Great Bear Petroleum LLC Nabors Rig 105E Drilling Operations Plan oac 3 August 2012 "awn 25: Joe Alston ioo so o 50 ReWslon: . -Feet Date: - Sheet 1 of 1 75 25 25 Page 1 of 2 Schwartz, Guy L (DOA) From: Bill Penrose[bill@solstenxp.com] Sent: Friday, August 03, 2012 2:31 PM To: Schwartz, Guy L(DOA) Cc: 'clark@greatbearpetro.com' Subject: RE: Merak#1 (PTD 212-101) Attachments: Merak#1 Wellhead.pdf; Merak#1 Tension Check.docx; MERAK 1-105E_PAD LAYOUT- 3AUG2012.pdf Guy, Please see my responses to your questions in red below. Also see the relevant attachments. Let me know if you need anything else. Regards, Parytode Drilling Manager x FullColor_sma 310 K Street,Suite 700 Anchorage,Alaska 99501 Main 907-279-6900 Direct 907-264-6114 Cell 907-250-3113 From: Schwartz, Guy L (DOA) [mailto:guy.schwartz@alaska.gov] Sent:Thursday, August 02, 2012 9:37 AM To: Bill Penrose Cc: Davies, Stephen F(DOA) Subject: Merak #1 (PTD 212-101) Bill, Reviewing the PTD for Merak#1.. Can you supply the following: 1)Please provide a wellhead diagram. Attached 2)This will likely be Nabors 106E first well after a long shutdown? Will need inspectors there for a go over before spudding well. We will be using Nabors 105AC which is currently drilling Great Bear's Alcor#1 and will move directly to the Merak#1. 3) Please provide Tension calculations for casing design... Burst/collapse were provided only. Attached 4) Map of diverter line layout on drillsite needed. Attached 5)The Frac sundry can't be approved till I have the actual well cementing data and mechanical Integrity data for the well (as constructed). I will hang on to the sundry and review the plan supplied so far. Should be a fairly quick turn around once the well is TD'd to approve the stimulation. Understood. We submitted this Sundry Application along with the APD at the Commission's request to enable an advance look at completion/frac plans. 8/3/2012 Great Bear Petroleum Operating LLC Morale!f1 Tension Check Surface Hole: Mud weight is expected to be 9.5 ppg upon comoletion of surface hole. 13 3/8".68#. L-80.BTC Surface Casing: Weight in air =2,500'x 68.0 lb/ft =170,000 lbs Buoyed weight of oioe = 170.000 x 0.8547 =145.306 lbs DFt= body tensile strength/buoyed weight = 1,556,000/145,306 =10.71 Intermediate Hole: Mud weight is expected to be 10.5 ppg upon completion of intermediate hole. 9 5/8".47#.1-80.BTC Intermediate casing: Weight in air =8.650'x 47 lb/ft =406.550 lbs Buoyed weight of pipe =406,550 x 0.839 =341,278 lbs DFt= body tensile strength/buoyed weight =1,086,000/341,278 =3.18 Sidetrack Hole to Shublik: Mud weight is expected to be 12.0 ppg upon completion of sidetrack through the Kingak to top Shublik. 7".29#.P-110.BTC-M Production casing: Weight in air = 10,939'x 29 lb/ft =317,231 lbs Buoyed weight of'aloe =317231 x 0.8165 =259.023 lbs DFt= body tensile strength/buoyed weight =955,000/259,023 =3.68 RECEIVED JUL 2 5 2012 3. r AOGCC Great Bear Petroleum Operating LLC A New Direction for the Last Frontier 601 W. 5`1 Ave., Suite 505, Anchorage, AK 99 501 Phone: (907) 868-8070, Fax: (907) 868-3887 July 24, 2011 Ms. Cathy Foerster, Chair Alaska Oil and Gas Conservation Commission 601 West 5th Ave., Suite 505 Anchorage, Alaska 99501 RE: Application for Sundry Approval Hydraulic Fracture Stimulation of the Merak #1 (PTD TBA) Dear: Ms. Foerster, Great Bear Petroleum Operating LLC hereby applies for Sundry Approval to hydraulically fracture down casing a new oil exploration well located onshore near the Dalton Highway south of Deadhorse, Alaska. A Permit to Drill the Merak #1 has not yet been issued by the AOGCC. Great Bear was requested by the Commission to submit this Sundry Application concurrently with the Application for Permit to Drill the Merak #1 to allow the Commission additional time to review the stimulation plans. Great Bear plans to use Halliburton hydraulic fracturing equipment to stimulate the Merak #1. The Well will ultimately consist of 20" conductor pipe, 13-3/8" surface casing, 9-5/8" intermediate casing, 7" production casing and 4-1/2" production liner. The well will be vertical to ±9,226' where it will be kicked off into a ±3,000' horizontal production hole. After drilling, coring and logging this vertical well, the rig will be moved off to drill another well while Merak is prepared for fracturing. After fracturing, the well will be production tested with oil going to temporary storage tanks and the gas being flared. Please find attached information for your review. Pertinent information attached to this application includes the following: Bringing the Unconventronal Resource Play to Alaska July 20, 2012 Page 2 of 2 1) Form 10-403 Application for Sundry Approval 2) Merak #1 Wellbore Diagram 3) Conceptual Fracture Stimulation Equipment Spread Layout 4) Request for Variance to 20 AAC 25.200d 5) Information on Confining Zones 6) Proposed Fracture Stimulation Procedure 7) Detailed Stimulation Design 8) Diagrams and Descriptions of the Wellhead and Stimulation Tree to be Used 9) Diagrams and Descriptions of the BOP Equipment to be Used If you have any questions or require additional information, please contact me at (907) 868-8070 or (281) 828-0389. Sincerely, Great Bear Petroleum Operating LLC ee.a,4&064nir Clark Clement, Chief Operating Officer Attachments Slinging the Unconventional Resource Pray to/Moss a RECEIVED IVED JUL 252�012 STATE OF ASKA ALASKA OIL AND GAS CONSERVATION COMMISSION A'�OG CC APPLICATION FOR SUNDRY APPROV A S 20 AAC 25.280 1 Type of Request Abandon❑ Plug for Redrill❑ Perforate New Pool❑ Repair 'ell❑ Change Approved Program❑ Suspend❑ Plug Perforations❑ Perforate❑ Pull bang❑ Time Extension❑ Operations Shutdown❑ Re-enter Susp Well❑ Stimulate 0 - Alt- Casing Cl Other ❑ 2.Operator Name 4 Current Well Class 5 Permit to Drill Number 2 Great Bear Petroleum Operating LLC Development ❑ Explora ry 0 TBA I 2.-)VI 3.Address. 6 API Number. Stratigraphic ❑ s- .- ❑ 601 West 5th Avenue,Suite 505,Anchorage,Alaska 99501 TBA 7.If perforating,closest approach in pool(s)opened by this operation to nearest 8. y-I flame and Number property line where ownership or landownership changes- Ilk Spacing Exception Required? Yes ❑ No C Merak#1 9 Property Designation(Lease Number). 10 Field/Pool(s) ADL 391706 Exploration 11. PRESENT WELL CONDITION SU7 ARY Total MD Depth (ft) Total Depth TVD(ft) Effective Depth MD(ft) Eff- e Depth TVD(ft) Plugs(measured). Junk(measured). P 15,133' 11,043' 15,123' b. 11,043' None None Casing Length Size M+ / TVD Burst Collapse Structural Ilk `/ Conductor 80' 16" a 80' N/A N/A Surface 2,500' 9.625" 2, 10' ` 2,500' 5,750 psi 3,090 psi Intermediate 11,523' 7" r ' , 10,946' 11,220 psi 5,834 psi Production Ili Liner 4,110' 4.5" 1k 11,043' 12,410 psi 10,670 psi Perforation Depth MD(ft) Perforation Depth TVD(ft). Tubin%'It,e Tubing Grade Tubing MD(ft) N/A N/A N /A N/A N/A Packers and SSSV Type N/A lir "ackers and SSSV MD(ft)and TVD(ft) ` 1 N/A 12 Attachments Description Summary of Proposal LH., \ 1 Well Class after proposed work. Detailed Operations Program ❑ BOP Sketch Exploratory 0 Development Cl Service ❑ 14 Estimated Date for15.Well Status after proposed work 9/1/201- Commencing Operations Oil CI Gas ❑ WDSPL El Suspended ❑ 16 Verbal Approval: Date WINJ ❑ GINJ ❑ WAG ❑ Abandoned ❑ Commission Representative GSTOR ❑ SPLUG ❑ 17. I hereby certify that the foregoing is true and correct to e best of my knowledge. Contact Bill Penrose 907-264-6114 Printed Name Clark Clement Title Chief Operating Officer Signature Or , - o e Date 907-868-8070 ,�2 7 J/'y �[�w�✓/ COMMISSION USE QIVLY Conditions of approval Notify Commission so that a epresentative may witness Sundry Number. 31 2. -'2.-T7 Plug Integrity ❑ BOP Test ❑ Mechanical Integrity Test ❑ Location Clearance ❑ Other Subsequent Form Required APPROVED BY Approved by COMMISSIONER THE COMMISSION Date Form 10-403 Revised 1/2010 RIGINAL Submit in Duplicate ")/ ( � Merak # 1 , , ', Proposed Wellbore Diagram 20" Conductor @ 80' 5/8" 3/8" ,� 9 - x 13 - Annulus , , Downsqueezed with Port Collar @ 500' III. �' ` ' Permafrost Cement 13 -3/8" Casing ; , Cement to Surface / 13-3/8" CasingID. 12.415" Burst Rating: 4,930 PSI 13 - 3/8" Casing Cement: Cement to Surface with L- 80, 68 lbs/ft, BTC e Permafrost Lead and TD @ 2,500' Class "G" Tail tt ria 9-5/8" Casing 4.1 NO I.D. 8.681" a tit Burst Rating: 6,870 PSI Cement: Class G from 9-5/8" Shoe to 13-3/8" Shoe. VI a lilA 7" Casing I.D. 6.184" Burst Rating: 11,220 PSI Cement: Cement 7" Shoe to 1,000 Above HRZ. 4.3 A Ss 4- 1/2" Casing ••::: 7" Casing 1.D. 3.920" Cement to 1,000' —► 740: Burst Rating: 12,410 PSI Above HRZ Cement: None. To be Completed with Swell Packers 9 - 5/8" Casing '.11r. O''''/ L- 80, 47 lbs/ft, BTC 44 4-1/2" Liner Top HRZ --- 8,650' MD P-110, 13.5 lbs/ft, HY521 7" Casing (Top Shublik) P - 110, 29Ibs/ft, BTC - M —01.— 0,04. '_.. .J.� � � -- 10,939' MD / 10,544' TVD 4.5" Liner Top — 10,439' MD / 10,300'TVD 0, ...� _ .. _ 8-1/2" Hole *. . Plug Back to — 9100' MD Merak # 1 TD Merak # 1 ST TD 10:794' D / 10,794' T,. :..,. 14,277' MD / 10,594' TVD (150' Below Base Shublik) (Mid - Shublik) REV: 23 JULY 2012 210' Blender 65x10 .... o o o o or:1 ..., o o o o o ) ._, ' AIL 0 0 R -- 1J 100 V1 Iron Truck 65x10 o Manifold Trailer 75x10 ___ 1 ---- 1.:•:•:-:•:•:•:•.•.•.•I, ., /o/ 1 HT 2000 65x10 - /1 o i II -- I li i i J [77_,1 [[ _ ' 1 , . . il ----- 11-7J i[ __,, / .......' 0/ • \ / / • \ , Panther 65x10 // // \\ .••..• \ \ /4. t-7_ TI- .. ._ / . ..„....._ ...4.,_ ,// ,/ ai alv , , EL-. Chemical Transport 65x10 1225' i li III Ism 395,_ __ I . i - L.z.,....7..._....„...,..„1-41 _d i II, d• \ Transport 50x10 der •//' ' <... \ \ lilt i , . •, , 1 . PS—2500 with Tractor 65x10 \ \ /4**/ //, / 3.1; , \ ., i/ , 4S, , . , ill vcsie_ 1 , PS—2500 10x10 "N •.,)i 0 0 v- \,, , .,... ,-,.-n--_,.- A.l Ii , I # : LDV—Pickup 25x10 ......(\ o o a ..-.'.... .• . . 1 . 0 . :i -I__] .•••. 1 ° - 1 - ,_.... . 7 i7 .• 8 k * El III MN _ . f. . Crew Van 30x10 o ,\:-\\ ,\\\, . .......... ...................... 100' .....1 im El Heater 7x5 I I ' Light Plant 5x5 135 • • • 111 75' Merak#1 Request for Variance from 20 AAC 25.200(d) Merak #1 As the Merak#1 is planned for fracture stimulation down the casing and flow-back and testing out through the same casing,the well will contain no tubing or packers. Thus Great Bear Petroleum requests a variance from 20 AAC 25.200(d)which specifies that wells capable of unassisted flow contain such production equipment. Mitigating measures to be in place during fracture stimulation flowback to ensure safe operation of the well include the following: • The production casing and liner consist of high-strength P-110 steel. •The production casing will be cemented up into the intermediate casing. Above the top of cement, the annulus between the intermediate casing and the production casing will be used to provide backup pressure during fracture stimulation and for monitoring for production casing leaks during flow-back and testing. •A 10,000 psi WP tree w/redundant valves, some of them hydraulically actuated,will be utilized. • The well is not expected to flow naturally after frac cleanup. • Testing equipment will be 10,000 psi WP rated with redundant valves and chokes. • All testing lines will be pressure tested prior to use. • The entire location will be completely contained in impermeable material and berms with sufficient holding capacity for all possible flowback and production. Great Bear requests that this variance remain in effect for one hundred eighty (180) days from the time of completing hydraulic fracturing operations. Due to the nature of the shale resource play being tested, this amount of time may be required to adequately characterize the cleanup period and production decline characteristics of the well and formation. Confining Intervals Merak #1 Fracture stimulation of the Merak#1 is planned within the Shublik Formation. The subsurface top of the Shublik is projected at 10,544' RKB and its base at 10,644' RKB. The Shublik is stratigraphically confined by its upper contact with the very massive mudstones/shales of the Kingak Shale and its basal contact with siltstones/mudstones of the Fire Creek Siltstone. The Fire Creek is itself confined by projected siltstone facies of the Ivishak Formation. Kingak Shale The Kingak Shale is projected at 1,650' thick in Merak#1 (8,894' — 10,544' RKB). The Kingak is a series of massive, generally homogenous, marine mudstone/shale sequences(sometimes referred to as"black shales" due to the high organic content) and deposited on the unconformable upper surface of the Shublik Formation. A distinctive feature of the the Kingak is its overall lack of lithologic diversity through very long sections. The top of the Kingak at Merak is the Lower Cretaceous Unconformity (a significant sub-surface chrono-stratigraphic reference). It is then confined by the LCU contact with the shales/mudstones of the 489' thick (8,405'RKB—8,894' RKB)Hue Shale-HRZ Formation. Current estimates of Kingak fracture pressure is 13.5 ppg EMW, a value to be adjusted prior to fracture stimulation,pending the results of DFIT testing in Alcor land Merak 1. Fire Creek Siltstone The Fire Creek Siltstone, whose upper surface contact confines the overlying Shublik Formation, is projected to be+125' thick at Merak#1 (10,644 RKB—+10,769' RKB). The Fire Creek consists of thinly interbedded and laminated to locally massive undifferentiated mudstone/shale, siliceous siltstone, nodular siltstone, very fine, tight, pyrite-rich quartz arenite sandstone and argillaceous sandstone. Light and dark alternating silica-rich and clay-rich layers are characteristic. Composition is dominated by quartz, with chert and lithics both ranging to 20%. Complex inter-grain support includes 10-15% silica and calcite as clastic particles and as cementation agents. The base of the Fire Creek is in contact with the projected silt facies of the Ivishak Formation, which locally consists of interbedded siltstone and shale. The fracture pressure in the Kingak is estimated to be 13.5 ppg EMW. DFIT testing in the Alcor well prior to fracture stimulation of the Merak#1 will probably result in a revision to the currently used regional fracture gradient, including that in the Fire Creek. Great Bear Petroleum Merak #1 WELL SPECIFIC Draft Completion Program V1 Theron Hoedel— Halliburton Project Management Completions Engineer 5/1/2012 7.0 Merak#1 Completions Procedure Draft Page 1 Objective of Operation The goal of this procedure is to complete and test the Shublik formation in the Merak #1 well with the goal of establishing economic oil production in order to justify a program of horizontal wells within the Shublik formation. The well will be sidetracked and kicked off to drill a horizontal well. Stimulation stages (17)within the Shublik will be isolated utilizing external swell packers, in an un-cemented lateral. The well will be stimulated using CobraMax H Pinpoint Stimulation and perforations will be made using a jetting tool on coil to open up the zones inside of the production liner. The stimulation will consist of 1,241,000 gallons (29,548 bbls) of a hybrid fluid system and 1,207,000 lbs of ceramic 20/40 proppant for a total of 373 lb/ft in the 3,338 ft lateral wellbore. There will also be 59,500 lbs of 100 mesh sand. After the stimulation the wellbore will be cleaned out with coiled tubing and turned over to production through flow testing equipment for a planned period of 30 days. Upon conclusion of the production test a decision will be made on how to go forward with production operations of the Merak#1. Health—Safety—Environmental—Quality • HES' safety regulations are to be adhered to at all times by all personnel on location—no exceptions. • Zero accidents. • Zero environmental incidents. • Perform daily safety meetings with crews and pre-job JSAs. • Make daily HSEQ inspections. • Minimum of four near misses to be documented per month of completion operations. • Ensure that all vendors follow correct billing instructions. • Ensure that all costs are captured in a timely manner. General Information Single Lateral 14,277 ft MD/10,594 ft TVD KOP:9,230 ft Legal: Surface 45' FSL,5008' FEL,Sec 8,T7N, R14E, UM Heel of Lateral 411' FNL, 1061' FWL,Sec 17,T7N, R14E, UM Toe of Lateral 2080' FNL, 1338' FEL, Location: North Slope,Alaska GL: 196 ft AMSL, KB=23.3 ft Wellhead-GE QCS-105 10K, 20"x 13-3/8"x 9-5/8"x 7" [7-1/16, 10K Frac Tree] Completion Fluid—NaCl Brine Tubulars Depth(MD) Type Specifications Burst Collapse ID/Drift 0-2500' Surface 13-3/8", 68#, L-80, BTC 4,930 psi 2,270 psi 12.415"/12.259" 0-8,650' Intermediate 9-5/8",47#, L-80, BTC-M 6,870 psi 4,750 psi 8.681"/8.525" 0-10,939' Prod. Csg. 7",29#, P-110, BTC-M 11,220 psi 8,510 psi 6.184"/6.059" 10,439'-14,277'Prod Liner 4-1/2", 13.5#, P-110, Hydril 521 12,410 psi 10,670 psi 3.920"/3.795" 7.0 Merak#1 Completions Procedure Draft Page 2 Pre-Frac Procedure 1) Perform necessary location work to prepare pad for completion operations. Set and pull test rig anchors for WSU/CTU. 2) Move in and position 60—400 bbl upright tanks to their necessary location for handling 24,000 bbls during the frac. a. This will leave us with 13,548 bbls to truck in during stimulation operations,which may cause a shut down for refilling. b. Take a water sample of the source water and send it to HES PE Lab for compatibility testing. c. Be prepared to heat on the fly with super heaters. Target 70*F water temp or higher at time of injection. d. Lay out location to enable proppant addition on the fly. 3) MIRU flow testers with 1502 iron and flowback manifold, 4-phase separator and flare stack, and 4 open top tanks with relief and flowback lines. 4) MIRU pump equipment and pressure test to 10,000 psi. Ensure the following is completed: a. Move in man lift, light towers,and necessary rental equipment and position ahead of frac spread. b. Set the 4.5" x 7" annular relief valve to 8,500 psi. Install and function test pressure relief valve on the treating line(s)from the pump to the wellhead. Relief line should vent to open flowback tank. c. Install hard line from the 95/8i x 7" annulus side outlet to open flowback tank and leave the valve open throughout the job. d. Set fracture pumping equipment kick-outs to 8,000 psi. e. Rig up satellite system and ensure any real time monitoring arrangements have been setup ahead of time. Frac Procedure 5) Conduct PJSM prior to the start of work and at crew change outs. All services and personnel on location should be in attendance. 6) Ensure that all pre-job QA/QC tasks have been performed, and equipment pressure tested. 7) RIH with CT and SurgiFrac BHA. 8) Pump stage 1 as per the designed pumping schedule after hydro-jetting perforations. 9) Pull CT unit to the next injection point. Confirm packer depths. 10) Hydro-jet and pump remaining stages as per the pumping schedule below. In the event of a mechanical wellbore issue (rapid pressure decrease) or max pressure is exceeded (screenout, etc.) contact engineer for instructions. Do not assume that attempting to pump back into the fracture at a low rate is acceptable; it may be a wellbore integrity concern. 7.0 Merak#1 Completions Procedure Draft Page 3 11) During any shut down between stages retrieve ISIP data. After the final stage is pumped obtain ISIP, and pressures for 5, 10 and 15 minutes. 12) Have water transfer company strap tanks throughout the job and notify company man of volumes. During any shutdown, get storage tank bottoms as close to zero as practical especially near the jobs end. Also obtain estimates on sand volumes near the end of the job so that the pumping schedule can be altered accordingly. 13) Remove frac lines from well head and backside. Move off frac equipment. Cleanout Procedure 14) TOOH with CT, remove Surgifrac Jet BHA,and MU wash nozzle BHA for cleaning out the lateral. 15) RIH with CT, obtain SO/OP measurements before entering the build and monitor through the lateral. Begin circulating at the well at 2 BPM and adjust the testers choke to allow 2 BPM inflow from the formation, thus 4 BPM total at surface. 16) After each injection point, circulate 20 bbl gel sweep (LGC-36 UC at 5 gal/Mgal — Target apparent viscosity = 60cp). 17) Plan on making a short trip after half the lateral has been cleaned. Stop at the heel and pump another 20 bbl gel sweep before finishing the short trip into the vertical. 18) RIH with the wash nozzle, continuing the same gel sweep at each injection point to until we reach the float equipment. (Make additional short trips as necessary throughout the cleanout). Tag the float equipment for depth control then pull back to the heel continuing to circulate and flowback the well. 19) Stop at the heel and pump a 20 bbl gel sweep. 20) Finish TOOH with CT and LD the wash nozzle at surface. Close the upper master valve, ND CT BOP and injector head. Blow out lines and RDMO CTU.Turn well over to flow testers. Flowback Procedure 21) Flow well back at 1-2 bpm.A plan will be outlined on adjusting the choke over the period of a given time but the rate of flowback may gradually increase to 6-8 BPM. a. Email daily production reports to recipients on distribution list. Reports should be sent out after 6AM grind outs are taken. b. Monitor and report all daily fluid volumes, cumulative fluid volumes, pressure, oil gravity, water chlorides, load left to recover, sand recovered, choke size, and time. c. Prior to any shut in, the well should be gradually choked back over a 24-48 hour period to avoid water hammering and potential for greater formation damage. If the well is brought back online it should also be brought back on over a 24-48 hour period. Artificial Lift Installation TBD 7.0 Merak#1 Completions Procedure Draft Page 4 7.0 Merak#1 Completions Procedure Draft Page 5 HALLIBURTON Great Bear Petroleum LLC 601 W. 5th Ave Anchorage, Alaska 99501 Alcor 1 Alaska United States of America Revised 17 Stage CobraMax Prepared for: Brian Ennis May 1, 2012 Version: 4 Submitted by: Jon Wickham Halliburton 1125 17th Street#1900 Denver, Colorado 80202 +13038994716 HALLIBURTON 1/42 Proposal 312022 v.4 HALL_ /RI >I Tril! Halliburton appreciates the opportunity to present this cost estimate and looks forward to being of service to you. Foreword Halliburton's Pinpoint Stimulation Service Multiple zone stimulations have unique challenges for the completion engineers. Effectively stimulating each individual pay interval using fracturing treatments can be costly and time consuming. There have been 'short-cuts' developed during recent years that have reduced stimulation effectiveness using treatment methods such as Limited- Entry perforating and high-rate treatments utilizing particulate diversion or perforation ball sealers. Our challenge was to re-think the approach to this technology and develop more cost effective and efficient solutions. Halliburton's efforts have resulted in a new product service line we refer to as Pinpoint Stimulation. Pinpoint Stimulation Solutions result in reduced completion cycle timeto production. This means getting things done in a single trip to the well. The conventional perforating, fracturing, setting bridge plugs, cleaning the wellbore for each interval can add days or weeks to a completion delaying production to sales and increasing overall costs. Halliburton's Solutions offer improved fracturing efficiency that often translates to improved productionleading to an overall reduction in cost per BOE. Halliburton's CobraMax® Solution A key to this technology offering is the use of Halliburton's Coiled Tubing well intervention system. CobraMax H Pinpoint Stimulation Solutions permit precision multiple fracture stimulation in horizontal completions with cased/cemented wellbore configurations. CobraMax H was specifically developed to permit injection of proppant laden treatment fluids via the Coiled Tubing/Casing Annulus after hydra-jet perforating and fracture initiation by pumping through 1-3/4" or 2" coiled tubing. Now we hydra-jet perforate and fracture stimulate multiple intervals individually in horizontal wells with a single trip to the wellsite. Enclosed is our recommendation to fracture stimulate the referenced well using a CobraMax H Fracturing Solution. Halliburton recognizes the importance of meeting society's needs for health, safety, and protection of the environment. It is our intention to proactively work with employees, customers, the public, governments, and others to use natural resources in an environmentally sound manner while supplying high quality products and services to our customers. We appreciate the opportunity to present this proposal for your consideration and we look forward to being of service to you. Our services for your well will be coordinated through the service center listed below. If you require any additional information or designs, please feel free to contact myself or our field representative listed below. 2/42 Proposal 312022 v.4 HALLIBURTON Prepared by: Tyler Stanworth Procedure Analyst Submitted by: Jon Wickham Technical Advisor SERVICE CENTER: SERVICE COORDINATOR: OPER. ENGINEER: PHONE NUMBER: 3/42 Proposal 312022 v.4 H, LLIBURTON Well Information Cobra Max Well Name: Alcor Well #: 1 Tubulars Name Measured Outer; inner Linear Aeth Diameter(in) Diameter(in) We '• 4 1/2" Production Casing 0 - 10000 4.5 4 11.6 2" Coil Tubing 0- 10000 2 1.732 2.67 4/42 Proposal 312022 v.4 HAL.LLIRLJRTTJ Job Fluids Summary Cobra Max FR-66 Water Volume Base Fluid Friction Clay Control Surfactant Breaker Biocide �' Biocide • Reducer r , 374000(Gal) Fresh Water' FR-66 CLA-Web Losurf-300D Optikleen-WF BE-7 BE-6 Totals 374000(Gal) 187(Gal) 187(Gal) 187(Gal) 187(Ibm) 187(Gal) 74.8(Ibm) SilverStim M Volume Base Fluid Crosslinker Breaker Clay Control Surfactant Catalyst Catalyst B 7," Buffer Fresh CL-31 Vicon NF CLA-Web Losurf-300D CAT-3 CAT-4 Optiflo-Ill BA-20 Water* 867000 867(Gal) 4335(Gal) 433.5(Gal) 867(Gal) 433.5(Gal) 260.1 (Gal) 1734(Ibm) 867(Gal) (Gal) Biocide Biocide 867000 BE-7 BE-6 (Gal) Totals 433.5(Gal) 173.4(Ibm) JOB TOTALS Volume Base Fluid Friction Clay Control Surfactant Breaker Biocide Biocide Crosslinker Reducer a (Gal) (Gal) (Gal) „....(Gal). (Gal) ..(tbm) (Gal) (Ibm) (Gal) Fresh Water" FR-66 CLA Web Losurf-300D Optikleen-WF BE-7 BE-6 CL-31 1241000 187 620.5 1054 187 620.5 248.2 867 Breaker Catalyst Catalyst Breaker Buffer (Gal) (Gal) (Gal) (Ibm) (Gal) , Vicon NF CAT-3 CAT-4 Optiflo-Ill BA-20 4335 433.5 260.1 1734 867 Proppant Designed Qty Ceramic Plus-20/40 1207000(Ibm) 1207000(Ibm) Common White-100 Mesh,SSA-2 59500(Ibm) 59500(Ibm) Customer Supplied Items* Designed Qty Tank Bottom Requested w/ Tank Bottom Fresh Water 1241000 Gal 0 Gal 1241000 Gal 5/42 Proposal 312022 v.4 Ly N co OO O O 00 00 O ((y O O O O Oo c) O O co co co O O Q."2 M (o O) N C m U ac LI, up LI, Li, 0 O O O O O . N M 00 (1 m m E C�C�. 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F H Pkt O O a W g +''� c'� " r- N `O O LL a d m J co v a O 1-IALLIBURTON Fluid Details - Treatment 17 Cobra Max FR-66 Water Volume(Gal) Base Fluid Friction Clay Control Surfactant Breaker Biocide Biocide Reducer (gal/Mgal) (gaUMgal) (Ibm/Mgal) (gal/Mgal) (tbm/Mgal) (gal/Mgal) Fresh Water* FR-66 CLA-Web Losurf-300D Optikleen-WF BE-7 BE-6 22000 0-22000 0.5 0.5 0.5 0.5 0.5 0.2 SilverStim M Volume Base Crosslinker Breaker Clay "Surfactant Catalyst Catalyst Breaker Buffer Biocide Biocide (Gal) Fluid (gal/Mgal) (gal/Mgal) Control (gal/Mgal) (gal/Mgal) (gal/Mgal) (lbm/Mgal) (gal/Mgal) (gal/Mgal) (lbm/Mgal) (gal/Mgal) Fresh CL-31 Vicon NF CLA-Web Losurf- CAT-3 CAT-4 Optiflo-Ill BA-20 BE-7 BE-6 Water 300D 51000 0- 1 5 0.5 1 0.5 0.3 2 1 0.5 0.2 51000 *Customer Supplied 40/42 Proposal 312022 v.4 A L 8 V C11 O 06 BOR7E"-.- 8 8 7-1/16"10,000 PSI 6BX W. - ` :v. __ 4* — -i tt', 1-13/16"10,000 PSI 111, , at. Aip,,, ,t, _ : ;11,.... .-.. a T , IL ti ; - 1( pie , 1I .a �y lii ,0 4 v,_, 1 1�€ �• r(®4 . ®) i 26.25" __ In ECONDARY PACKOFF — :. 11"10,000 PSI 6BX _-z. i 6 ''''''mow-"wait NV 1 ® C 1-13/16"10,000 PSI . () 29.37" 7"SLIP TYPE CASING HANGER I • � Aw w s -t . ,e' . a. Ar: it:0'3;\lair' I MIMI 86.69" .,> ; ~ / / ,P '. S 5 frAlia � I ' ECONDARY PACKOFF i # 9-5/8"PACKOFF I D 4 �,, i I 13-5/8"5,000 PSI 6BX 4 9-5/8"FLUTED CASING HANGER G I 2-1/16 5,000 PSI 28.63" I " X �® , ice. ei i s ro, . ,IS . „„,i, MX :rt NI. iY 115' ' a� r \ ”et /< 3 ,. � 3 i'l:,':''' :1 '''„„4:isf 13-3/8"QUICK DISCONNECT I i — r2 13-3/8"FLUTED CASING HANGER 1 f a �3•, 1 Lt.' ' i ' 20"LANDING RING 2 2 I 20"OD CSG — 13-3/6"OD CSG I 5/8"OD CSG INSTAII 7-I/I6" 10 000 PSI 7"ODCSG TURING HFAD ASSFMflIY uzirmss o. / SOS vetco9ralT- LAYOUT6 On e/ SWE STEP 21 p�;'„-,z,'■ HP120102-120 INC nu.I.a D.a,zlazl MODEL NAME-XPI t0102-I I 8 C I- O PROLE t® GE Oil & Gas (68-1/2") era' �rr_.rt1,44,.....7-1/16 10,000 "fgr 4-1/16 10,000 ^' wIN4-1{16 10,000 ,r'h X3 1502 (THREAD HALF) ^ Liri_ 0 sten f71/16 10,000 _ i (153.00") \ r 7-1/16 10,000 • 'ul nrerara ADAPTER, 4-1/16 X 2-1/16 10,000 2-1/16 10,000 •• • •Luart11111111110 2-1/16 10,000 . � f '' I �'.� :79'.' . I 2-1/16 10,000 10,0E ' � `��' 2' 1502 (THREAD HALF? ' -m.trtre 7-1/16 10,000 0 U 1 "'° �U p, foo© �! (87.50") iC in O � 0 _©€ r 111111e.M111 rill mrn_"-uw. 7-1/16 10,000 '- — 11 10M mil ILII As ai '" k:; :',:::i Ptil This drawing is the property of GE Oil&Gas Pressure Control LP and is considered confidential. Unless otherwise approved in writing, GREAT BEAR neither it nor its contents may be used,copied, transmitted or reproduced except for the sole purpose of GE Oil&Gas Pressure Control LP. 7-1/16 10,000 psi FRAC TREE ASSEMBLY DRAWN CEDRIC 08MAY12 W/2-1/16" 10,000 PSI WING SECTION APPRV CR 08MAY12 W/7-1/16 X 4-1/16 10,000 PSI GOAT HEAD FOR REFERENCE ONLY DRAWING No, H P 120063 1! 'oruVanoil 4 1/16" 10K Quad BOP dTcehnotagies w/ Enviro-Safe Dismantling System The quad BOP has a four ram configuration to provide positive protection against blowouts and to secure the well in emergencies. This permits work to be carried out,under pressure,on surface equipment while the tubing is still in the wellbore. Our Enviro-Safe Dismantling System allows for quick and easy ram access, without any hydraulic fluid loss. By removing the actuator capscrews the actuators can be functioned back and away from BOP body. Once the actuators are retracted the rams can be removed for inspection,or servicing. An additional attribute is the "internal plumbing" feature. Single point open and close ports permit operation of both hydraulic actuators for each set of rams. The requirement of harness hoses becomes redundant, thereby effectively reducing the number of hoses and connections. " aomommo i ' Standard ram configurations are: � 1)Blind seal rams-top set of rams that serve to seal-off well pressure when no tubing is present 40 411.9* 2)Shear rams-second set of rams that ' serve to shear the tubing 4 - ,, .,, ,81 : , 3)Slip rams-third set of rams that serve to hold the tubing in place while shearing or for other applications t. _ 4)Pipe seal rams-bottom set of rams a that serve to seal around the tubing,thus isolating the wellbore pressure below ---..044‘,..„ ,,- the rams Features D Available with a ported type connection which can be used for downhole injection D Available with a variety hand unions,flanged or client specified connections. D Optional ram configurations D Operated with any hydraulic source capable of providing 3000 psi.hydraulic pressure D Manual lock holds rams mechanically locked in closed position D Manual override available in case of hydraulic failure. A-8064 Edgar Industrial Cres.,Alberta Canada,T4P 3S2 Direct:(403)347.8280/Fax(403)347.8281 /www.vanoil.com IForum Vanoil 4 1/16" 10K Quad BOP OiiriErtwnr, i :iL w/ Enviro-Safe Dismantling System 4 1/16" Technical Specifications Working Pressure: 10,000 psi Maximum Coiled Tubing Size:2 3/8" Operating Temperature: -28°C—120°C(-20°F—250°F) Internal Bore ID:4.06" Dimensions Overall Height: 43.88"(studded flanges) Width:51.64" Thickness: 19.09" Weight: 3615 lbs. Hydraulic System Connections: 1/2"NPT Box Hydraulic Operating Pressure:2800-3000 psi(max) Standard Actuator: Hydraulic Opening Volume(per Set): 118 in3 Hydraulic Closing Volume(per Set): 109 in3 Shear Actuator: Hydraulic Opening Volume(per Set):218 in3 Hydraulic Closing Volume(per Set):212 in3 Connections Common Top Connections: BX-155 10KPSI Studded Flange Integral 8.25-4 ACME(6.00)'B'Female Hand Union Common Bottom Connections: BX-155 10KPSI Open or Studded Flange Integral 8.25-4 ACME(6.00)`B'Male Hand Union Side Injection Port: BX-152 10K Studded Flange with a BX-152 10K x 2" 1502 Female Crossover A-8064 Edgar Industrial Cres.,Alberta Canada,T4P 3S2 Direct:(403)347.8280/Fax(403)347.8281 /www.vanoil.com Great Bear Petroleum Proposed Casing Fracturing Utilizing the CobraMax Frac Technique June 18, 2012 The Merak well The first well to be drilled horizontally by Great Bear and fracture stimulated will be the Merak #1. ( Please refer to the wellbore diagram.) The 16" conductor will be set at 80', the 9 5/8" surface casing at 2500', the 7" intermediate/completion string at 11,523'MD, and the 4 1/2" liner across the horizontal section at 15,133'MD. All casing will be new with mill specifications delivered with the casing. Prior to drilling horizontally, the Merak #1 will be drilled to a vertical depth of 11,200' in an 8 %2" hole with coring taking place in the HRZ, Lower Kingak, and Shublik formations. The well will be plugged back as shown in the diagram without setting casing. Sidetracking operations off the cement plug will be performed down to the top of the Shublik formation. The 7" casing will be set at that point. A 6 1/8" hole will be drilled to TD at 15,133' entirely in the Shublik formation. The intent is to have a 4000' lateral section. The 4 %Z" liner will have_ 16 "swell packers" on the outside of the casing allowing for a 17 stage frac operation. The packers swell utilizing the mineral oil based mud used to drill the well providing a seal against the formation. Instead of cementing the wellbore as is done in many horizontal wells, this type of completion is very similar to an open hole completion in that any natural fractures or permeable sections are not sealed off by cement. The packers have been tested to make sure they are strong enough to seal between each stage of the frac. The proposed frac technique for the Merak is the CobraMax operation described below. Halliburton has estimated the fracture gradient to be 0.75 psi/ft and run frac models based upon that. The fracture stimulation rate for this first job will be 16 BPM producing a surface pressure of 6400 psi,. Total fluid volume for the 17 frac stages is 30,000 bbls and the proppant volume is 1.3 million lbs. Why Fracturing Down the Casing Rather Than Down a Tubing String? One key factor to production from all the shale plays in the Lower 48 is that production can be directly correlated to the volume of frac fluid pumped. Unlike conventional reservoirs which rely on permeability and porosity for production, shales rely on connecting natural fractures already in the formation through the use of hydraulic fracturing. Most of these fractures are closed and not connected. The intervals being stimulated in horizontal wells are also several thousand feet of formation versus far shorter intervals in conventional wells. This requires large volumes of frac fluid. Since the shales being stimulated to connect the natural fractures are normally over 100' thick and sometimes far greater, the frac height is critical such that it connects most or all of the natural fractures the entire height of the formation. In order to do this with hydraulic fracturing, high rate is needed. Placement of high rate/high volume jobs down tubing/packer configurations is not possible due to the size of the tubing which limits the rate due to pressure limitations. Fracturing down casing has become the norm in shale plays for this reason. Casing fracturing is the only practical way to inject large volumes of frac fluid and proppant at high rates. Wellbore Integrity Since this will probably be the first casing frac run in Alaska, special attention to wellbore integrity has been addressed. The surface frac tree is rated and tested to 10,000 psi. (Frac Tree Diagram). Casing being exposed to fracture treating pressure of 6400 psi will be the 7" and 4 1/2" casing strings with the highest' differential pressure being seen at the surface in the 7"easing. (Wellbore Diagram) The 7" casing burst rating is 11,220 psi. As a backup to the 7" to insure casing integritduring the frac job, the cement will be brought up to just below the casing shoe., Immediately after the cement job, injection will be established down the 9 5/8"/7" annulus. Cement will then be pumped down the annulus to the top of the first cement job insuring that the 7" is covered with cement. According to Solsten XP, this is a common and accepted practice in Alaska. The burst rating of the 9 5/8" surface casing is 5750 psi and is cemented back to surface. With the 9 5/8"/7" casing being fully cemented as well as the burst integrity of the 7" casing being 11 2200, the possibility of a casing breach during fracturing operations has been greatly minimized if not eliminated. 170 �� Overview of the Frac Technique to be used in Great Bear's Merak and Alcor wells Halliburton's CobraMax Frac Technique is designed to perforate and fracture stimulate horizontal wells in a continuous operation. The steps below outline the sequence of events: 1) Coiled tubing is rigged up on top of the frac tree with the frac equipment installed on the side outlets of the tree. 2) In order to perforate the casing, the coil is lowered into the wellbore to the depth of the first interval to be perforated in the horizontal section. On the end of the coil is a jetting tool which applies sand and gel being pumped from the surface through the jet nozzles at high velocity thereby cutting holes through the casing and into the formation. 3) As soon as the holes are cut, an injection rate is established into the formation to insure the holes are open and ready for fracture stimulation. 4) The coiled tubing is pulled back up into the vertical casing, and the fracture �\6- .``Q pumping equipment establishes formation breakdown at an acceptable C' cc rate and pressure. Frac fluid and proppant are placed into the formation as in a conventional fracture treatment with all the material being pumped 6,5 i down the annulus of the coiled tubing/casing and into the lateral casing. 5) At the end of the treatment stage, the sand concentration is increased to intentionally screen out and set a sand plug in the casing. Once the sand plug is in place and pressure held on it for a period of time to make sure no more injection is taking place, the frac pumps are brought off line and the coiled tubing lowered into the lateral from the vertical section of casing. 6) The sand plug is "tagged" to determine the depth and to make sure the next interval can be jet perforated. If the plug is covering the next set of perforations, the jetting tool has the capability of"reversing out" the excess sand thereby uncovering the next interval to be perforated. 7) This interval is perforated, injection established, coiled tubing pulled back into the vertical wellbore, fracture stimulation performed, sand plug set, etc. until all the frac stages are completed. 8) Upon finishing the last frac stage, the coiled tubing is lowered back into the horizontal casing and all of the sand plugs are washed out of the hole leaving the well ready to flow test. 9) The coiled tubing and frac equipment are rigged down and the well is turned over to the flowback and well testing facilities. Future Frac Operations The frac rates and proppant volume to be used on the Merak#1 well is modest by most shale fracturing jobs. The zone directly below the Shulik may be wet so the frac rate is only 16 bpm on this job to limit height growth. However, depending on results, future jobs especially in the Lower Kingak and HRZ will probably require higher rates. Regardless, casing integrity will always be taken into account by utilizing stronger or larger casing should the need arise. Merak # 1 r i. Proposed Wellbore Diagram 16" Conductor @ 80' _______ 9-5/8" Casing I.D. 8.835" Burst Rating: 5,750 PSI 9 5/8" Casing Cement: Cement to Surface with L- 80, 40 lbs/ft, BTC Permafrost Lead andClass "G" Tail TD @ 2,500' 7" Casing I.D. 6.186" Burst Rating: 11,220 PSI • Cement: Class G from 7" Shoe to 9-5/8" Shoe. Permafrost Cement Squeezed down annulus from Surface to 9-5/8" Shoe 7" Casing 4- 1/2" Casing P - 110, 29 lbs /ft, BTC- M I.D. 3.920" 11,523' MD/ 10,946' TVD Burst Rating: 12,410 PSI Cement: None. To be Completed with Swell Packers 4-1/2" Liner P-110, 13.5 lbs/ft, H 5221 • 4.5" Liner Top 10,450' MD / 10,348'TVD , di•��O 1 V.- Merak # 1 ID Merak # 1 ST TD 11 .200' TD / 11 ,200' IVO 15,133' MD / 11 ,043' TVD REV 11 JUNE 2012 .16 GE Oil & Gas (68-1/2") i.e. Stotu 7-1/16 10.000 : i • 4-1/16 10,000 I4 4 + `\, 4-1/16 10,000 a� .•� `` X 3 1502 (THREAD HALF) Noun'rr 1.01.1 7-1/16 10,000 n .rn...1 Comme °gyp,�° r/ (153.00") .��� 7-1/16 10,000 - ADAPTER, 4-1/16 X 't'�`_t'-'t"t1 2-1/16 10,000 2-1/16 10,000 `�""'= 2-1/16 10,000 1�'II. �- 1ILS 1 1. �I �r-) 0 ����. r.� �.r r 1 I 2=11 5062 1(THREAD HALF) nnrnu ItltlJtl_I//.uW 7-1/16 10,000 1...101141.1: r� .W ._ (87.50'') r1 0 : Stimulation Effectively Fracture Horizontal Wel!bores and Overcome the Effects of Flow Convergence CobraMax® H Fracturing Service Pinpoint stimulation process provides highly efficient performance for fracturing multiple-interval horizontal wells completed with unperforated, cemented casing. • • xrw, F .. ► Proppant pack as a final stage of each fracture treatment helps achieve maximum conductivity in the near-wellbore region. ► Enables perforating and fracturing in the same trip in the hole. ► Eliminates the need to set mechanical plugs that must be removed later. ti,,,. HALLIBURTON I Enhnnrw+`mnnt ' STIMULATION CobraMax® H Fracturing Service Proven Pinpoint Stimulation Technology to Effectively Fracture Horizontal Wellbores and Overcome the Effects of Flow Convergence - A Halliburton Top Technology for 2007 CobraMaxo H service provides highly efficient performance for fracturing multiple-interval horizontal wells completed with unperforated,cemented casing.The process is especially beneficial since in horizontal wells flow convergence from the fracture into the wellbore can(ruse a significant loss in \ fry production. The proppant pack as a final stage of each �"r fracture treatment helps achieve maximum conductivity in the near-wellbore region where flow convergence:issues are n 9 k the most extreme. The service enables optimizing key treatment parameters such as injection rate,proppant volume,and proppant concentration. CobraMax H service takes advantage of the well control capabilities and speed of coiled tubing and provides several important benefits: CobraMax H service uses a proppant pack as a final stage of each • Enables perforating and fracturing in the same trip fracture treatment to help achieve maximum conductivity in the near-wellbore region. in the hole. • Eliminates the need to set mechanical plugs that must be removed later. Implementing CobraMax H Service The process is performed with a coiled-tubing-deployed • Enables the use of conventional coiled tubing units, Hydra-let"'bottomhole assembly. The BHA is moved to typically 1-3/4-or 2-in.OD units. the first target and perforating is accomplished by • No temperature limits with the bottomhole assembly hydrajetting via the coiled tubing. The annulus is closed (BHA)• in to enable breaking down the perforations and the • No depth limitations,except for the reach of the fracture treatment is pumped through the annulus. coiled tubing. During the fracturing treatment,the coiled tubing is moved • Enables fracturing in casing sizes of 3-1/2 in.or greater toward the next interval to be treated and acts as a dead • No downhole packer or bridge plug to manipulate. string for fracture diagnostics. A final proppant stage of • All operations are on a live well. uncrosslinked fluid with high proppant concentration is HSE and Quality Focus pumped to induce a near-wellbore proppant pack that • Requires fewer trips in the hole and to the wellsite as further improves near-wellbore conductivity and acts as a compared to conventional multistage treatments. diversion for treatments further uphole. • Requires a smaller operating footprint for improved When all intervals have been treated,the well is cleaned-out environmental performance. with the coiled tubing unit and the well can be jetted or flowed to recover treatment fluid. CobraMax H service is continually monitored and improved under Halliburton's Correction,Prevention and Improvement(CPI)process to achieve a high level of health, safety and environmental performance.Halliburton's Management System(HMS)process helps achieve global transfer of best practices and consistently high service quality. HALLIBURTON The CobraMax H Service Process Case History South Texas:The majority of the formations in the arca require hydraulic fracturing to sustain sufficient production. One Operator had tried many different stimulation and completion techniques including multistage remote-activated casing perforation modules,composite plugs,and stimulation valves. All of these methods proved 1.tee 11ydru-Jct‘"sen kc to perforateand initiate the fracture. unsatisfactory due either to job related problems or insufficient post production. Halliburton recommended CobraMax H service. 11.111111r."- tHioNorr Well conditions included a sandstone formation below I • • 10,000 ft with BHST 295°F and 3-1/2-in.unperforated cemented liner as production casing. The objective was 2.Pump rile fra;l:triw:treatment,l„..„the,.;;:r::!r,, to place six distinct fractures in the horizontal section. 1-3/4-in.coiled tubing was used in the treatment. Just "b`` over 1 million lb of 20/40 ceramic proppant and 1/2 million _ 11.11111"",1104111111111? lb 20/40 resin coated ceramic proppant were placed. The w = A:<»• '..s well was flowed back and achieved the highest production in the field with quick treatment payout. 3.,Note BHA toward the rne.et interval beyond este pr„pp,,,u. Ten additional wells have been treated using CobraMax H service for this Operator and nine more treatments have been performed for different customers in the South Texas -----r1> II 1""'1 11w-i t area. r'»+ Global:To date,more than 50 horizontal wells around the world have been stimulated with this method and most -1.Reverse while r,a hint out to next forget. recently at greater than 17,000 ft MD(5,200 m)and over 1 million lb(450 T)of proppant. — �-- -......,Iltwri It +I Mw t'•' . �' - Z 5. Use Ilyrira-Jet service to perforate and repeat the process for each interval. B I For more information about how CobraMaxe H service can help add production from horizontal wellbores and improve your ROI,contact your local Halliburton representative or e-mail stimulation@Halliburton.com. www.halliburton.com Sales of Halliburton products and services will be in HALLIBU RTON H05678 7/07 accord solely with the terms and conditions contained ©2007 Halliburton in the contract between Halliburton and the customer All Rights Reserved that is applicable to the sale.Actual results may vary Printed in U.S.A. in accordance with conditions and other variables. OVERSIZED DOCUMENT INSERT This file contains one or more oversized documents. These materials may be found in the original hard file or check the parent folder to view it in digital format. TRANSMITTAL LETTER CHECKLIST WELL NAME 4 e rci.k 1 PTD# 2- 12 - l 0 Development Service Exploratory Stratigraphic Test Non-Conventional Well ,5744 oiL FIELD: POOL: Fi /a,of' Check Box for Appropriate Letter/Paragraphs to be Included in Transmittal Letter CHECK ADD-ONS WHAT (OPTIONS) TEXT FOR APPROVAL LETTER APPLIES MULTI LATERAL The permit is for a new wellbore segment of existing well (If last two digits in Permit No. , No. 50- API number are ' between 60-69) Production should continue to be reported as a function of the original API number stated above. PILOT HOLE In accordance with 20 AAC 25.005(f), all records, data and logs acquired for thepilot hoQle must be clearly differentiated in both well name ( UwK �j PH) and API number (50-2.?3 - 2U� 2 7 -7 ) from records, data and logs acquired for well Metal. 1 j SPACING The permit is approved subject to full compliance with 20 AAC EXCEPTION 25.055. Approval to produce/inject is contingent upon issuance of a conservation order approving a spacing exception. assumes the liability of any protest to the spacing exception that may occur. DRY DITCH All dry ditch sample sets submitted to the Commission must be in SAMPLE no greater than 30' sample intervals from below the permafrost or from where samples are first caught and 10' sample intervals through target zones. Non-Conventional Please note the following special condition of this permit: Well production or production testing of coal bed methane is not allowed for (name of well) until after (Company Name) has designed and implemented a water well testing program to provide baseline data on water quality and quantity. (Company Name) must contact the Commission to obtain advance approval of such water well testing program. Rev:9/09/2011 L_ Y 0 (0 To N N 'O Nota N N _N a) a) ❑ .-. 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Technical Report Title Date Client: Great Bear Petroleum LLC Field: Exploration Rig: Nabors 105 Date: October 13, 2012 Surface Data Logging End of Well Report Merak 1 TABLE OF CONTENTS 1. General Information 2. Daily Summary 3. Morning Reports 4. Bit Record 5. Mud Record 6. Formation Tops 7. Survey Report 8. Days vs. Depth Digital Data to include: Final Logs Halliburton Log Viewer EMF Log Viewer EOW Report PDF Version A D I B a c k u p GENERAL WELL INFORMATION Company: Great Bear Petroleum LLC Rig: Nabors 105 Well: Merak 1 Field: Exploration Borough: North Slope Borough State: Alaska Country: United States API Number: 50-223-20027-00-00 Sperry Job Number: AK-AM-0009498071 Job Start Date: 19 August 2012 Spud Date: 21 August 2012 Total Depth: 11094’ MD, 11081’ TVD North Reference: True Declination: 20.7461° Dip Angle: 80.791° Total Field Strength: 57608 nT Date Of Magnetic Data: 23 August 2012 Wellhead Coordinates N: North 69° 58’ 7.368” Wellhead Coordinates W: West 148° 42’ 48.292“ Drill Floor Elevation 196.42’ Ground Elevation: 174.70’ Permanent Datum: Mean Sea Level SDL Engineers: Matthew Smith, Charles Sinn, Timothy Collins, Jessica Munsell, Dave Mckechnie SDL Sample Catchers: Will Grimes, Nathanial Van Kirk, Elia Epchook, Joshua Cloyd, Todd Wilson Company Geologist: Craig Silva, Lees Browne Company Representatives: Shane McGeehan, Mike Grubb, Jay Murphy, Gus Gustafson SSDS Unit Number: 117 DAILY SUMMARY 08/19/2012 – 08/20/2012 SDL arrived on location. Set up computers and computer network. Rigged up gas trap and ran gas line back to the unit. Set up 8800 gas analyzer and 8900 gas chromatograph and calibrated. Conducted unit inspection and completed the unit tier inspection form. Rigged up diverter line and surface stack. Took on 200 barrels spud mud to pits. Started picking up 5” drill pipe. 08/21/2012 Finished picking up and standing back 5” drill pipe. Function test BOPs and annular. Pick up and stand back HWDP. Load pipe shed with 13 3/8” casing. Pick up and load BHA and directional tools in shed. Test mud pumps and mud lines. 8/22/2012 Held pre-spud meeting and washed down and cleaned out conductor from 43’ to 117’. Spudded well at 02:30 hours. Rotated from 117’ to 318’. Circulated and conditioned hole. Tripped out of the hole to pick up directional BHA. Picked up directional BHA and surface tested directional BHA. Tripped in hole with directional BHA, resumed drilling/sliding from 318’ to 560’. Lost 300 psi and ROPs became erratic. Drilled to 707’. Tripped out of the hole, cleaned stabilizers and checked bit. Geology: Abundant various sourced gravel and pebbles and light gray to clear, quartz-rich coarse grained sand with occasional amounts of gray clay. Gas: Very minimal gas, less than 1 unit, C-1 only, less than 70ppm. Fluids: No fluid losses down hole 8/23/2012 Rotary drilled from 707' to 1530' @ 80 RPM and 550 GPM. Rotary drilled from 1530' to 1853' @ 80 RPM and 600 GPM. Pumped high vis sweeps every 200' of drilling. Drilled clays at 950'. Reduced viscosity at suction to accommodate increased viscosity at flow line from clay formation. Geology: Abundant various sourced gravel and pebbles and light gray to clear, quartz-rich coarse grained sand with occasional amounts of gray clay. Gas: Very minimal gas, less than 1 unit, C-1 only, less than 70ppm. Fluids: No fluid losses down hole 8/24/2012 Rotary drilled from 1856'-2462' 80 RPM 600 GPM. Clay zones continued to increase viscosity. Pumped high viscosity sweeps every 200'. Ran centrifuge with drilling. Pumped 60bbl very high viscosity spacer. POOH to heavyweight DP, working tight spots. Ran back to bottom. Circulated andcleaned hole. Dropped carbide bomb, came back 2000 strokes early. Dropped 10 # rice tracer, came back 600 strokes early. Geology: Predominately unconsolidated fine grained, well sorted and well-rounded sands suspended in a light grey soft clay matrix. As we neared surface TD encountered more silts and claystones suspended in a clay matrix. Gas: Very minimal gas, less than 1 unit, C-1 only, less than 70ppm. Fluids: 20 barrels mud lost down hole 8/25/2012 Tripped out of hole. Worked through tight spots. Rig and Ran 13.375" casing. Large quantities of clay cuttings to surface with casing displacement. Mud returned very high vis. Circulated bottoms up at 1000'. Geology: No geology to report Gas: Very minimal gas, less than 1 unit, C-1 only, less than 70ppm. Fluids: No fluid losses down hole 8/26/2012 Ran 13.375" casing to 2447'. Circulated bottoms up to ensure low vis mud in annulus. Tripped in hole with 5" DP and stab into FLT collar. Circulated to establish returns up 13.375" annulus. Pump 40 bbl citric/desco/bicarb treated mud, 5 bbls H2O, 60bbls 10.5 ppg spacer, 10.7 ppg lead cement, 82 bbls 15.8 ppg tail. Returned 180 bbls excess cement. Dropped DP wiper plug, 10 bbls H20, displace with 27 bbls mud. Tripped out of hole. Geology: No geology to report Gas: Very minimal gas, less than 1 unit, C-1 only, less than 70ppm. Fluids: No fluid losses down hole 8/27/2012 Laid down centralizer, cement stinger, and landing joint, cleared rig floor. Washed out stack. Removed diverter line, riser, mouse hole, annular, and diverter tee. Installed BOP trolley, nipple up bottom rams and mud cross, surface tested casing head seals to 5000 psi. Hung annular, set up double gates and annular. Cleaned out surface pits 3,4,5,6 Geology: No geology to report Gas: Very minimal gas, less than 1 unit. Fluids: No fluid losses down hole 8/28/2012 Rigged up choke hose, koomey lines, function tested BOPE, installed mouse hole and riser. Changed out lower rams from 4” to 5”, picked up testing tools and test joint, make up dart valve, picked up and set test plug. Tested annular to 250 psi low/ 2500 psi high, test good. Started next test, leak on blind ram door seal, drained stack and opened ram door to replaced door seal on blind rams. Tested BOPE and valves to 250 psi low/ 5000 psi high for 5 minutes. Tested annular to 250 psi low/ 2500 psi high, all tests were good and witnessed by AOGCC representative. Dummy ran casing joint and verified hanger in well head. Laid down testing tools and cleared rig floor and cellar and blew down surface equipment. Picked up BHA and staged BHA in pipe shed, picked up motor and bit. Geology: No geology to report Gas: Very minimal gas, less than 1 unit. Fluids: No fluid losses down hole 8/29/2012 Made up directional BHA to 190’ and surface tested tools. Tripped into the hole to 741’ and shallow tested the tools @ 800 GPM. Took on 600 bbls of LSND mud and displaced hole with 9.2 LSND @ 2348’. Pressure tested casing to 3500 psi for 30 minutes, test good. Tagged float collar at 2359’. Drilled out float and cement from 2359’ to 2427’. Drilled out shoe track and 20’; of new formation to 2482’. Preformed LOT and observed 13.1 ppg EMW, rigged down testing equipment. Drilled ahead f/ 2482’ to 3113’ Geology: Claystone, clay, sand. Common loosely consolidate silty matrix supported medium grained sandstones. Occasional 5-10’ thick coal stringers and organic-rich claystones Gas: Low gas averaging below 10 units, maximum observed gas was 18 units at 3051’, C-1 and very low C-2 values only. Fluids: 11 barrels mud lost down hole 8/30/2012 Rotate ahead from 3113’ to 3496’. Short trip for wiper from 3496’ to 2433’. Ran back to bottom at 3496’. Rotate ahead from 3496’ to 4548’. Geology: Claystone, silty claystones and silty fine grained sandstones, occasional thin coal stringers and organic rich claystones, trace amounts of thin white ashy tuffs. Gas: Averaging 60 units while drilling, occasional higher gas peaks under coal stringers, max gas was 456 units beneath a coal stringer at 4496’, C-1 and very low C-2 values only, higher gas peaks were mostly C-1, max C-1 was 85089 ppm at 4496’. Fluids: 25 barrels mud lost down hole 8/31/2012 Pumped high viscosity sweep and circulated bottoms up. Pulled out of hole for a short wiper trip from 4548’ to 3426’. Ran back to bottom at 4548’ and drilled ahead to 5506’. Pumped high viscosity sweep and circulated bottoms up at 5506’ Geology: Claystone, silty claystones and silty fine grained sandstones, occasional thin coal stringers and organic rich claystones, trace amounts of thin white ashy tuffs. Gas: Averaging 30-40 units while drilling, occasional higher gas peaks associated with coal stringers, max gas was 301 units at 5505’, C-1 and very low C-2 values only. Fluids: 15 barrels mud lost down hole 9/1/2012 Circulate and condition hole. Pulled out for short wiper trip from 5506’ to 4545’. Ran back to bottom at 5506’, picked up 18 stands of singles on way in. Rotated and slide ahead from 5506’ to 6560’. Pumped high viscosity sweep and circulated bottoms up at 6560’. Began wiper trip from 6560’ to 5779’ Geology: Fine grained sandstones and silty sandstones, occasional siltstones, trace coal stringers. Gas: Averaging 80-100 units while drilling, occasional higher gas peaks associated with coal stringers or sandstones, max gas was 291 units at 6344’ associated with a sandstone, C-1 through C-5 present through most of the section, C-4’s and C-5’s more common in sandstones. Fluids: 30 barrels mud lost down hole 9/2/2012 Continued wiper trip, pulled tight at 5779’. Back reamed from 5779’-5580’, pulled to 5495’ Ran back to bottom at 6560’. Rotated and slid ahead from 6560’-7613’. Pumped high viscosity sweep and circulated bottoms up. Pulled out of hole for wiper a trip from 7613’-7133’. Began offloading 400 barrels of mud during wiper trip. Geology: Fine grained sandstones and silty sandstones, occasional thin coal stringers. Gas: Averaging 100 units while drilling, max gas while drilling was 364 units at 6738’. C-1 through C-5’s present through section Fluids: 10 barrels mud lost down hole 9/3/2012 Continued pulling out the hole, encountered tight spots at 6938’, 6835’, 6735’, and 6525’. Finished offloading mud and brought on 400 new barrels of 9.5ppg mud. Ran to bottom and resumed rotating and sliding ahead to 8090’. Began build from 8090’, continued sliding and rotating to 8264’ Geology: Fine grained silty sandstones and common silty claystones. Gas: Gas averaging 60 units while rotating and 30 units while sliding. Fluids: 30 barrels of seepage mud loss down hole. 9/4/2012 Continued to slide and rotate from 8264’ to intermediate casing point at 8750’. Pumped high viscosity sweep and circulated bottoms up, continued to circulate until mud was 9.6ppg all around. Tripped from 8750’ to 7707’ and pumped dry job. Geology: Fine grained silty sandstones and silty claystone. Encountered to top of the hue shale at 8480’, with brown-gray, well laminated shales. Gas: Gas average between 30-70 units in sandstones and siltstones dependent on ROP. Gas began to increase in the Hue shale, averaging 300 units with a gas peak of 1481 units at 8714’. Fluids: 30 barrels of seepage mud loss down hole. 9/5/2012 Continued to trip out of the hole from 7707’, pulled tight at 6560’, 6464’, 5962’, 5854’, 5477’ and 5347’. Rotated slowly and pulled from 5347’ to 5240’, continued pulling from 5240’ to 4835’. Began pulling tight and began pumping and back reaming out of the hole from 4835’ to 3209’ and encountered pack off and decreased return flow. Circulated and condition at 3209’ and regained full returns, continued to back ream out of the hole to the shoe at 2441’. Circulated and conditioned mud, circulated bottoms up. Slipped and cut 124’ of drilling line. Tripped into the hole from the surface shoe to 4643’, filled pipe every 1000’. Geology: No geology to report Gas: Encountered a maximum of 91 units of gas while circulating. Fluids: 107 barrels mud lost down hole 9/6/2012 Continued to trip into the hole from 4643’ to 8733’ without any issues. Rotated and washed from 8733’ to bottom. Circulated and conditioned mud until clean returns were observed at the shakers. Tripped out of hole from 8750’ to the shoe at 2441’ with minimal tight spots. Laid down the direction and MWD tools, download data from MWD tools. Removed the wear bushing, pulled wear ring and cleaned and clear the rig floor. Picked up single and test plug, flushed the stack and rigged up testing equipment. Tested blind rams to 250psi low and 5000 psi high. Rigged down testing equipment and blew down kill and choke lines. Began loading wireline tools into the pipe shed. Geology: No geology to report Gas: Encountered a maximum of 416 units of gas while circulating. Fluids: No fluid losses down hole 9/7/2012 Made up sheaves and rigged up wireline tools. Ran into the hole with the triple combo/GEM tools. Ran triple combo/GEM logs, pulled out of hole. Picked up wave sonic tools. Ran into the hole and logged up from 8720’ with the wave sonic logs. Rigged down wireline tools. Drained stack, pulled wear ring, installed test plug and tested annular to 250psi low/2500psi high and rest of BOPs to 250psi low/5000 psi high. Geology: No geology to report Gas: No gas to report Fluids: No fluid losses down hole 9/8/2012 Finished testing BOPs, gas alarms, Koomey and PVT and flow alarms. Rigged down testing equipment, installed wear bushings, blew down choke and kill lines. Made up cleanout BHA and tripped into the hole to the shoe and filled pipe. Continued tripping into the hole, filling pipe every 1500’-2000’, encountered tight spots at 7170’ and 8628’. Tripped to bottom and circulated and conditioned mud until returns at shakers were clean. Pulled out of the hole from 8750’ to 5130’ with no tight spots. Geology: No geology to report Gas: Encountered a maximum of 214 units of gas while circulating. Fluids: No fluid losses down hole 9/9/2012 Tripped out of the hole from 5130’ to surface without any problems or tight spots. Laid down BHA. Removed wear bushing and set test plug, started rigging up casing equipment, changed rams to 9 5/8” fixed rams. Tested rams to 250psi low/3500psi high. Laid down testing tools. Picked up casing tools, made up shoe track and started running 9 5/8” casing to 3078’, filling each joint and circulating at surface shoe. Geology: No geology to report Gas: Encountered a maximum of 28 units of gas while circulating. Fluids: No fluid losses down hole 9/10/2012 Ran casing from 3078’, filling every joint and breaking circulation every 35 stands. Landed casing at 8726.66’. Drained stack, verified land, rigged down casing equipment. Rigged up cementing equipment and cement lines. Circulated bottoms up and clean returns. Tested cement lines, dropped wiper plug and pumped first stage of cement: 369bbls of 12.5lbs lead and 78bbls 15.8lbs tail. Dropped plug and flushed 10bbls, chased with rig pumps at 10bpm, 3pbm at packer, losing mud with poor returns at surface. No sing of plug landing at collar. Bleed off and checked float. Geology: No geology to report Gas: Encountered a maximum of 614 units of gas while circulating before first stage cement. Fluids: Lost 280bbls of LSND while chasing plug with rig pumps. 9/11/2012 Dropped plug and allow it to seat, pumped 540psi to open ES cementer. Circulated at 5bpm with no cement to surface. Pumped 8bbls water and 30bbls spacer, pumped second stage of 160bbls of 15.8lbs cement, no returns at 150bbls pumped, dropped plug and chased with 165.5bbls of LSND on rig pumps, losing mud, bumped plug at 2221stks, no returns. Rigged down cementing equipment, changed out bails and elevators, Nippled down BOP and removed wellhead. Installed new well head and tested same, nipple up pipe rams and mud cross. Continued to rig up MPD surface equipment throughout the day. Geology: No geology to report Gas: No gas to report Fluids: Lost 165bbls of LSND while chasing second plug with rig pumps. 9/12/2012 Attached choke and kill lines, set double gate, set rotating head on annular, set annular on double gate. Torque BOP flanges, change top and bottom rams to 5 ½”, installed tee on rotating head. Installed valve on rotating head on tee, secured stack. Cleared cellar and installed MPD valve below tee. Installed Koomey lines, function tested BOPs and bring Koomey online, function tested rams, Picked up testing equipment and test joint, tested BOPs. Body test for BOP to 250psi low/3500psi high. Load pipe shed with 63 joints of pipe and strapped same. Installed wear bushing and picked up pipe from pipe shed. Geology: No geology to report Gas: No gas to report Fluids: No fluid losses down hole 9/13/2012 Picked up and racked back 63 joints of drill pipe. Serviced top drive and tested upper and lower rams. Installed/ worked on new flowline modifications and new BOP riser. Strapped and picked up cleanout BHA, ran in hole with cleanout BHA and tagged up at 2377’, washed down to 2397’ tagged second stage cement plug. Geology: No geology to report Gas: No gas to report Fluids: No fluid losses down hole 9/14/2012 Drilled out plug from 2397’ to 2427’, pimped to open valve and inflate packer. Tested casing to 3000psi for 30 minutes, test good. Tripped out of the hole from 2427’ to surface. Laid down BHA. Picked up testing tools and tested BOP to 250psi low/5000psi high, tested annular to 2500 psi, preformed accumulator test. Laid down testing tools and blew down surface lines. Picked up BHA, shallow tested tools ran in hole to 2312’, slid through packer at 2312’. Tagged plug at 2505’, chased plug down hole to 8415’, filling pipe every 2500’. Circulated and conditioned, tagged up at 8590’. Geology: No geology to report Gas: No gas to report Fluids: No fluid losses down hole 9/15/2012 Drilled out collar and shoe and 20’ of new formation to from 8590’ to 8770’. Circulated and conditioned mud, displaced 9.8ppg mud with 10.4ppg mud. Preformed LOT to 14.7ppg equivalent at 8721’ TVD. Drilled ahead from 8770’ to 9012’, core point #1 in top of the HRZ. Weighted up mud to 10.6ppg as a result of high gas. Circulated and conditioned, check for flow tripped into shoe to 8702’ and pumped dry job. Tripped out of hole from 8702’ to 5920.’ Geology: Brownish black, moderately hard well laminated shale and tuffs in the Hue Shale, Dark grayish brown well laminated shale at HRZ starting at 8948’MD Gas: 400 to 800 units of gas while drilling, connection gases and pumps off gas above 1000 units. Max gas was 1755 units before mud was weighted up to 10.6, gas decreased to under 200 units while circulating 10.6ppg mud around prior to tripping out of the hole. Fluids: No fluid losses down hole 9/16/2012 Tripped out of hole from 5910’ to BHA. Laid down drilling BHA and made up coring BHA, Tripped into the hole to 8662’, filled pipe every 2000’. Slipped and cut 82.5’ of drill line, service top drive, blocks, and crown. Made up ball-drop sub, tripped into the hole to 9007’, tagged fill, washed and rotated to bottom. Dropped flow diversion ball and circulated. Geology: Grayish brown well laminated shale and occasional gray-white tuffs. Gas: Encountered a maximum of 1092 units of gas while circulating out trip gas. Fluids: No fluid losses down hole 9/17/2012 Cored ahead from 9012’ to 9028’, stopped rotating, pulled 32k over to break core. Tripped out of hole from 9028’ to surface, laid down core assembly and laid down core, recovered 14.37’ of core. Made up new coring assembly. Geology: Grayish brown well laminated shale and occasional gray-white tuffs. Gas: Encountered a maximum of 1102 units of gas while circulating out trip gas. Fluids: No fluid losses down hole 9/18/2012 Changed out jars, finished making up coring BHA. Ran into the hole to 9028’, circulated and conditioned. Began second core from 9028’ to 9073.’ Geology: Grayish brown well laminated shale and occasional gray-white tuffs. Gas: Encountered a maximum of 805 units of gas while circulating out trip gas. Fluids: No fluid losses down hole 9/19/2012 Cored ahead f/ 9073’ to 9089’, Pulled 30k over to break off core. Tripped out of hole from 9089’ to 8723’ in the shoe, pumped dry job. Tripped out of the hole and laid down coring BHA and core, recovered 100% of the core. Set back core BHA in derrick, serviced top drive. Geology: Grayish brown well laminated shale and occasional gray-white tuffs. Gas: Encountered a maximum of 62 units of gas while drilling. Fluids: No fluid losses down hole 9/20/2012 Picked up directional tools and made up directional BHA. Shallow pulse tested tools at 331’, Tripped into the hole to 8928’ and washed down to 9030’. Began MAD Passed from 9030’ to 9089’. Drilled ahead to 9217’, saw 2240 units of gas, circulated out high gas and began weighting up mud to 11.0ppg. Rotated and slid ahead from 9217’ to 9408’ MD. Geology: Grayish brown to brownish black silty shale and occasional gray-white tuffs, trace siltstones and rare sandstones. Gas: Encountered a maximum of 2240 units of gas while drilling and high gas before weighting up mud, connection/ pumps off gases 1000+units. Fluids: No fluid losses down hole 9/21/2012 Drilled ahead to the next core point at 10611’ MD. Weighted up to 11.4 ppg because of high background gas. Pumped a 20 barrel high viscosity sweep. Tripped out of the hole to 9561’ MD and monitored well, static. Continued to trip out of the hole. Geology: Gray to dark gray, moderately hard, platy to round, silty to gritty textured shale with trace mica and trace pyrite. Gas: The mas gas was 1738 units and the drilling background average was 671 units. Fluids: There were no fluid losses down hole. 9/22/2012 Tripped out of the whole to surface. Laid down BHA. Tested BOPs. Function test BSS de- silter. Picked up coring bit and core barrel. Tripped into the hole to 2324’ MD. Geology: No geology seen. Gas: The max gas while circulating was 9 units. Fluids: There were no fluid losses down hole. 9/23/2012 Continued to run into the hole with core barrel. Packed off at 9242’ MD, back reamed out a stand. Washed and reamed down to bottom at 10611’ MD. Observed a large quantity of shale over the shakers. Pumped a high viscosity sweep. Saw a max trip gas of 4403 units of gas while circulating. The gas cut mud from 11.4 ppg to 10.6 ppg. Dropped ball and began coring ahead at 1.5 – 2 feet an hour. Geology: Dark gray to medium gay, medium brown gray, firm to hard, silty, friable, platy to flaky, occasional silty laminations, non-calcareous shale with trace pyrite and trace claystone. SHOW: Scattered spotty fluorescence, slow pinpoint streaming cut, and a white milky residue Gas: A max trip gas of 4403 unit was seen while reaming and washing to bottom. The max gas was 789 units and the average back ground gas was 227 units. Fluids: There were no fluid losses down hole. 9/24/2012 Continued to core ahead to 10660” MD. Weighted up mud system to 11.6 ppg and circulated until 11.6 ppg all around. Attempted to break core, pulled 55K over and observed catcher slipping. Pulled to 65L over to break core. Monitored well, static. Began pulling out of the hole. Geology: Dark gray to medium gray, medium brown gray, firm to hard, silty platy to flaky, non- calcareous shale with trace pyrite and trace claystone. Gas: The max gas while coring was 175 units and the average background gas was 35 units. Fluids: There were no fluid losses down hole. 9/25/2012 Continued to pull out of the hole to surface. Laid down the core barrel, core #3 – 100% recovered. Picked up a new 90’ core barrel #4 and began tripping into the hole. Tripped into the hole to 8702’ MD, filled pipe. Cut and slip drill line and serviced rig. Finished tripping in to 10656’ MD, washing and reaming to bottom. Pumped high viscosity sweep and circulated to surface. Observed shale cavings, 1-2 inch long, at surface. Gas cut mud was 10.3 ppg when 3280 units was seen. Dropped the ball and cored ahead. Geology: Medium to dark gray, hard, blocky, argillaceous, non-calcareous siltstone. Gas: A max trip gas of 3280 units was seen at bottoms up. The max gas while coring was 274 units and the average background gas was 172 units. Fluids: There were no fluid losses down hole. 9/26/2012 Cored ahead to 10748’ MD. Pulled 28K over to break core. Pumped out of the hole to 8714’ MD. Attempted to pull out on elevators and observed 20-30K over pull. Circulated bottoms up to clean hole. Pumped 20 barrel dry job. Tripped out of the hole to surface and laid down core barrel #4 – 100% recovered. Weighted pit system to 11.8 ppg and increased to 6% KCl concentration to prevent shale swelling and splintering. Picked up new 90’ core barrel #5 and tripped into the hole, filling pipe every 2000’ MD. Geology: Medium to dark gray, firm, trace soft, silty shale, with trace pyrite, and gray white to cream, firm to soft, very calcareous limestone. Gas: The max gas was 925 units and the average background gas was 172 units. Fluids: There were no fluid losses down hole. 9/27/2012 Continued to trip into the hole with 90’ core barrel #5 to 10210’ MD and encountered a tight spot. Reamed/washed down while rotating to 10586’ MD. At 10594’ MD began to encounter packing off and sticking. Circulated bottoms up and reamed/washed down to bottom. Dropped ball and attempted to care ahead from 10649’ – 10753’ MD. Observed plugged core barrel. Weighted up mud system to 12 ppg. Back reamed and pumped out of the hole to the shoe. Began pulling out of the hole on elevators. Geology: Medium to dark gray, firm, trace soft, silty shale with traces of pyrite. Gray white to cream, soft to firm, very calcareous limestone. Gas: Max gas was 4246 units and the average background gas was 175 units. Fluids: There were no fluid losses down hole. 9/28/2012 Continued to pull out of hole on elevators to surface. Laid down core barrel, cleared core barrel obstruction and recovered 2’ of core. Picked up new core bit and core barrel #6 and began tripped into hole filling pipe every 2000’ MD. Reamed and washed down to 10573’ MD. Pumped a high viscosity sweep and attempted to circulate the hole clean, 600’ of fill was encountered. Geology: Medium to dark gray, firm, trace soft, silty shale with traces of pyrite. Gray white to cream, soft to firm, very calcareous limestone. Gas: Max gas was 398 units and the average background gas was 194 units. Fluids: No fluids lost down hole. 9/29/2012 Continued to circulate hole clean, while washing and reaming to bottom. Dropped ball and cored from 10753’ MD to 10843’ MD. Broke off core with 25K over pull. Weighted up mud system to 12.2 ppg. Back reamed and pumped out of the hole to the shoe. Observed 20K over pull at casing show, worked balled up stabilizers until obstruction cleared. Pumped a high viscosity sweep. Pull into the shoe with no over pull and circulated sweep. Pumped dry job and continued to pull out of the hole. Geology: Limestone: Creamy gray in color, occasions of brown-gray, firm to brittle, traces of shale and pyrite, with scattered sandstone towards bottom of interval. Gas: Average background gas was 249 units with a max of 703 units. Fluids: No fluids lost down hole. 9/30/2012 Continued to pull out of the hole on elevators to surface. Laid down core barrel #6. Rigged up to test BOPs and began testing BOPs. Geology: No geology. Gas: No significant gas data. Fluids: No fluids lost down hole. 10/01/2012 Continued testing BOPs. Replaced upper BOP and tested BOPs. Wait on smaller elevators from another rig. Pick up core barrel #7 and began tripping into the hole filling pipe every 2000’ MD. Cut and slip drilling line. Tripped into the hole to 9147’ MD. Began reaming and washing down. Geology: No geology. Gas: A trip gas of 640 units was seen while washing and reaming to bottom. Fluids: No fluids lost down hole. 10/02/2012 Continued to ream and wash down to bottom, working through tight spot at 10277’ MD to 10375’ MD. Pumped a 20 barrel sweep once free and increased flow to 210 gpm and continued to wash to bottom. Dropped ball and core ahead to 10933’ MD. Pumped 20 barrel sweep and broke core off with 10K over pull. Began backing reaming out of the hole. Geology: Dark gray to black, firm to hard, elongate with up to 1 inch by 0.1 inch cuttings, flaky, splintery shale with scattered sandstone and tuff. Gas: A max trip gas of 6212 units was seen, and the max gas while coring was 520 units and the average background gas was 125 units. Fluids: No fluids lost down hole. 10/03/2012 Continued to back ream out of the hole to the shoe and then began pulling out of the hole on elevators to surface. Changed out mud pump liners to 5.5”. Picked up BHA with MWD tools and began running in the hole, filling pipe every 2000’ MD. Geology: No geology. Gas: The max gas while tripping was 582 units. Fluids: No fluids lost down hole. 10/04/2012 Continued to trip in to the hole, filling pipe every 2000’ MD, to 9484’ MD and encountered fill. Began reaming and washing down, pumping high viscosity sweeps as needed. Geology: No geology. Gas: While reaming to bottom, a max gas of 2508 units was seen. Fluids: No fluids lost down hole. 10/05/2012 Continued to ream and wash to bottom through 6.75” hole section from last coring run. Began drilling ahead at 10933’ MD and drilled ahead to 11094’ MD TD. Began pulling out of the hole at 240 feet an hour for MAD PASS. At 9370’ MD encountered tight spot, worked pipe and pumped sweep, Sweep brought back a 25% increase in cuttings volume and size. Continued to MAD PASS out of the hole. Geology: Transparent to milky white, tan, occasionally light gray, fine to medium grained, sub angular to sub round, moderately to poorly sorted slightly calcareous sandstone with trace pyrite, shale, and tuff with mineral fluorescence. No show. Gas: The max gas while drilling was 418 units at 11080’ MD. Fluids: No fluids lost down hole. 10/06/2012 Continued to MAD PASS out of the hole to the shoe. Circulated bottoms up and pumped a dry job. Began pulling out of the hole on elevators. Laid down BHA. Spotted wire line unit and began rigging up. Geology: No geology. Gas: The max gas was 237 units and the minimum gas was 24 units. Fluids: No fluids lost down hole. 10/07/2012 Ran in the hole with wire line logging tools to 8740’ MD and encountered fill, could not get any deeper. Pulled out of the hole and added a hole finder tool. Ran in the hole and was still not able to get below 8740’ MD. Pulled out of the hole and rigged down wire line unit. Laid down heavy weight drill pipe and changed out upper rams to 2-7/8” by 5”. Picked up 2-7/8” tubing and began tripping into the hole. Geology: No geology. Gas: The max gas while tripping in was 312 units. Fluids: No fluids lost down hole. 10/08/2012 Continued running in the hole with 2-7/8” tubing to 8723’ MD and circulated bottoms up. Continued to trip into the hole to 9200’ MD and encountered fill. Reamed and washed down through tight spots to bottom, pumping high viscosity sweeps when needed. Rigged up cement trucks and lines while circulating and conditioning mud. While pumping on bottom began to lose mud. Geology: No geology. Gas: A max trip gas 1691 units was seen while circulating bottoms up. The minimum gas was 309 units. Fluids: Lost 217.5 barrels of water based mud down hole. 10/09/2012 Continued to rig up cement trucks and lines. Pressure tested cement lines. Pumped first cement plug. Attempted to pull out to above the cement plug with over pull of 325K. Brought up pumps and had minimal returns. Lost 343 barrels while attempting to free pipe. Pipe pulled free and tripped out of the hole to 9747’ MD. Dropped wiper plug and washed down to 10170’ MD. Pumped second cement plug and tripped out of the hole to 9088’ MD. Dropped another wiper plug and circulated out to the shoe. Pumped third cement plug and pulled out of the hole to 8514’ MD. Dropped wiper plug and circulated one and half bottoms up in preparation to trip out of the hole. Began tripping out of the hole. Geology: No geology. Gas: The max gas was 5062 units while circulating. Fluids: Lost 343.8 barrels of water based mud down hole. 10/10/2012 Continued to trip out of the hole on elevators to surface. Laid down 2-7/8” tubing. Rigged up to test BOPs and tested BOPs. Picked up 2-7/8” tubing and began tripping into the hole. Geology: No geology. Gas: No significant gas data. Fluids: No fluids lost down hole. 10/11/2012 Tripped into the hole and tagged cement at 8822’ MD. Pumped a dry job and pulled out of the hole sideways while waiting on cement truck to 6372’ MD. Ran back into the hole to the shoe and circulated. Tested cement lines and pumped fourth cement plug. Dropped a wiper ball and circulated a bottoms up. Cut and slip drill line. Geology: No geology. Gas: No significant gas data. Fluids: No fluids lost down hole. 10/12/2012 Pulled 15 joints out of the hole sideways. Ran back into the hole with four stands. Rigged up to pressure test. Pressure tested casing to 3000 psi for 30 minutes. Test good. Began pulling out of the hole sideways, laying down each joint. Rigged down gas trap, gas equipment, and computers. Geology: No geology. Gas: No significant gas data. Fluids: No fluids lost down hole. SDL released 13 August 2012 Customer:Report #: Well:Date: Area:04:00 Depth Location:Progress 24 hrs: Rig:Rig Activity: Job No.:Report For: ROP & Gas: . Mud Data:Density (ppg)Viscosity Depth ft in out (sec/qt) BHA Run #Bit Type TFA Hours Depth in / out Footage WOB RPM Condition Lithology (%): (current) *10000 units = 100% Gas In Air Logging Engineer:Report By: Jessica Munsell Ann Corr Cor Solids (lb/100ft2) 24 hr Max YP mg/l Sst API Filt Sd LstSiltSiltstClystSh C-5n TuffCht PV Size MBT 1 8/20/2012 96 Nabors 105E AK-AM-0009498071 ml/30min Great Bear Petroleum LLC Merak 1 Exploratory (ppb Eq)cP Gas Summary Chromatograph (ppm) Units*Depth GvlCoal Min Avg pH Chlorides % AvgMin Max Max Total Charges: Flow In (spm) SPP (psi) Gallons/stroke 0 Rigging Up Grubb/Gustafson Flow In (gpm) Current Pump & Flow Data: North Slope Daily Charges Avg Current R.O.P. (ft/hr) Depth PWD Drilling All Circ Avg Diam Max @ ft Hole Condition On Bot Hrs C-1 C-2 C-3 C-4i C-4n C-5i Maximum Minimum Average Background Trip (current)(max) 24 hr Recap: SDL arrived on location. Rigged up gas trap and sample lines. Set up computers and gas equipment calibrated gas equpiment. Rig continued to rig up and instal diverter. Matthew Smith/ Charles Sinn Matthew Smith Customer:Report #: Well:Date: Area:04:00 Depth Location:Progress 24 hrs: Rig:Rig Activity: Job No.:Report For: ROP & Gas: . Mud Data:Density (ppg)Viscosity Depth ft in out (sec/qt) BHA Run #Bit Type TFA Hours Depth in / out Footage WOB RPM Condition Lithology (%): (current) *10000 units = 100% Gas In Air Logging Engineer:Report By: Jessica Munsell 24 hr Recap: Finished rigging up diverter. Installed riser and cement/bleeder lines. Preped pipe shed for 5" DP. C/O saver sub, guide and die blocks on topdrive. Rigged up tongs and elevators. Strapped 5" DP. Took on 200 bbls spud mud to pits and 40 bbls water. started picking up 5" DP from pipe shed and racked back. Function tested annular. Matthew Smith/ Charles Sinn Matthew Smith (current)(max) Background Trip Average Minimum C-4i C-4n C-5i Maximum C-1 C-2 C-3 PWD Drilling All Circ Avg Diam Max @ ft Hole Condition On Bot Hrs Current R.O.P. (ft/hr) Depth 0 Picking Up 5" DP Grubb/Gustafson Flow In (gpm) Current Pump & Flow Data: North Slope Daily Charges Avg Total Charges: Flow In (spm) SPP (psi) Gallons/stroke AvgMin Max Max Min Avg pH Chlorides % GvlCoal Gas Summary Chromatograph (ppm) Units*Depth Great Bear Petroleum LLC Merak 1 Exploratory (ppb Eq)cP 2 8/21/2012 96 Nabors 105E AK-AM-0009498071 ml/30min PV Size MBT Cht Sh C-5n TuffSdLstSiltSiltstClystSst API Filt Ann Corr Cor Solids (lb/100ft2) 24 hr Max YP mg/l Customer:Report #: Well:Date: Area:04:00 Depth Location:Progress 24 hrs: Rig:Rig Activity: Job No.:Report For: ROP & Gas: . Mud Data:Density (ppg)Viscosity Depth ft in out (sec/qt) BHA Run #Bit Type TFA Hours Depth in / out Footage WOB RPM Condition Lithology (%): (current) *10000 units = 100% Gas In Air Logging Engineer:Report By: Jessica Munsell 24 hr Recap: Finished picking up and racking back 5" DP. Serviced topdrive. Function test BOPs- Test annular and knife valve, Koomey draw down test, test rig gas alarms, PVT sensors and Flow indicatros witnessed by AOGCC. Loaded pipe shed with 13 3/8" casing. Picked up and racked back HWDP. Made up drilling assembly. Loaded directional tools in pipe shed. Tested mud pumps and mudlines to 3000psi. Tagged up at 44.2' inside of conductor. Cleaned out conductor @ 02:00 hrs. Tagged bottom and began drilling ahead at 02:23hrs. Drilling ahead at 229' as of 04:00 hrs. Matthew Smith/ Charles Sinn Matthew Smith (current)(max) Background 1 Trip N/A 0 0 0 0 0 0 0 0 Average 0 25 0 0 0Minimum0200'0 0 0 0 0 0 C-5i Maximum 1 212'63 0 C-2 C-3 C-4i C-4n PWD Drilling All Circ Avg Diam 130.0 Max @ ft 0 bbls 16.00''Hole Condition On Bot Hrs Current R.O.P. (ft/hr)160' Depth 229'1.2 229 Picking Up 5" DP Grubb/Gustafson Flow In (gpm) Current Pump & Flow Data: North Slope Daily Charges Avg 492 155 Total Charges: Flow In (spm) SPP (psi) Gallons/stroke Min Max Max N/A 1090 3.1730 N/A Min N/A Avg N/A pH Chlorides % N/A GvlCoal 90 Units*Depth C-1 107.0 210.0 Great Bear Petroleum LLC Merak 1 Exploratory 16 0.6995 (ppb Eq)cP Mill Tooth EBXT1GRC 3 8/22/2012 229 Nabors 105E AK-AM-0009498071 ml/30min 3.28.80 8.80 300 PV Size MBT 27.5 Cht 34 1.20 10 Gas Summary Chromatograph (ppm) 0 C-5n TuffSd 7.4 Lst 116' #1 Silt Siltst ClystSst API Filt 9.6043 Sh Ann Corr Cor Solids (lb/100ft2) 1,100 24 hr Max YP mg/l N/A Avg Customer:Report #: Well:Date: Area:00:00 Depth Location:Progress 24 hrs: Rig:Rig Activity: Job No.:Report For: ROP & Gas: . Mud Data:Density (ppg)Viscosity Depth ft in out (sec/qt) BHA Run #Bit Type TFA Hours Depth in / out Footage WOB RPM Condition Lithology (%): *10000 units = 100% Gas In Air Logging Engineer:Report By: Jessica Munsell Ann Corr Cor Solids (lb/100ft2) 800 24 hr Max YP mg/l N/A Avg Sst API Filt 8.90 50 48 10% ShSd 7.8 Lst 116' #1 #2 Mill Tooth EBXT1GRC Silt Siltst Clyst 10 C-5n Tuff 0 80% Gas Summary Chromatograph (ppm) Cht 39 8.20 707' 591' 9.20 9.20 200 PV Size MBT - Mill Tooth EBXT1GRC 707' 4 8/23/2012 707 Nabors 105E AK-AM-0009498071 ml/30min 4.7 0.6995 80.0 187.0 Great Bear Petroleum LLC Merak 1 Exploratory 16"0.6995 (ppb Eq)cP Units*Depth C-1 16" GvlCoal 10% N/A Min N/A Avg N/A pH Chlorides % N/AMin Max Max N/A N/A 3.1730 N/A N/A Total Charges: Flow In (spm) SPP (psi) Gallons/stroke 707 Drilling McGeehan/Gustafson Flow In (gpm) Current Pump & Flow Data: North Slope Daily Charges Avg Current R.O.P. (ft/hr)230' Depth 707'8.2 PWD Drilling All Circ Avg Diam N/A Max @ ft 0 bbls 16.00''Hole Condition On Bot Hrs C-2 C-3 C-4i C-4n C-5i Maximum 1 75 0 0 0 0 0 0 Minimum 0 0 0 0 0 0 0 0 Average 0 40 0 0 0 0 0 Background 0 Trip N/A (current)(max) Matthew Smith/ Charles Sinn Matthew Smith Time Operation Summary 00:00-02:00 02:00-02:30 02:30-05:30 05:30-06:00 Load pipe shed with directional tools. Hold pre-job/pre-spud meeting with all personel Tagged up @ 43' in conductor, cleaned out to 117' Drilled ahead f/ 117' t/ 318' Circulated and conditioned mud. P/U BHA, make up new bit #2, RIH w/ new bit. Washed down, Tagged 6' of fill, Serviced topdrive and blocks. 06:00-07:00 07:00-12:00 12:00-19:00 19:00-19:30 19:30-24:00 Current Activity Proposed Activity 00:00-04:00: Slide f/707' to 786'. Rotate from 786' to 815' as of 04:00 Continue to drill ahead to surface casing point at +/- 2500' Depth:707' Tripped out of hole f/ 318' to 49' Picked up 8" BHA and directional tools, Tripped in hole, shallow tested tools-test good, washed down f/249'-318' Drilled ahead f/318' to 524', slide f/524'-560', rotate f/560' to 620', 300psi drop, erratic ROPs, rotate f/620'-707' Survey, Trip out of hole, Clean and inspect stabilizers and bit, clear rig floor Report number 4 Job No.:AK-AM-0009498071 Density: 9.6 Daily time-slot 00:00 - 03:00 03:00 - 07:30 07:30 - 09:20 09:20 - 12:00 12:00 - 15:00 15:00 - 18:00 18:00 - 21:00 21:00 - 24:00 Interval (ft) 707'-1856' Max Min Interval (ft) BHA Run #Bit Type Size TFA Hours Footage WOB RPM Condition #1/ Run 100 16"0.6995 #2/ Run 200 16"0.6995 ROP Current Avg 24 hr Max Max @ Ft R.O.P. (ft/hr)50 44 Depth Ann Corr Drilling Min N/A Avg N/A Max 1856 19.7 0 16"All Circ Min N/A Avg N/A Max Lower Kingak (K-1 Top) Lower Kingak Base Top Shublik Ivishak Base Shublik Fire Creek 4-4-WT-A-X-1-PN-PP 167 1785' Not cuts or shows Flow In (gpm) 595 SPP (psi) 2495 591 10 50.000EBXT1GRC EBXT1GRC 8.2 Depth In Depth Out 116 707 0 0 0 0 0 0 2 0 77 0 2 0 Depth (ft)Gas type & remarks 1780 Kuparauk B Kuparauk A Miluveach Upper Kingak Lower Kingak TD Formation Holocene Gublik Top HRZ (Higly Radioactive Zone) Base HRZ Pebble Shale LCU (Lower Cretaceous Unconformity) Middle Sagavanirktok Permafrost Mikkelson Tongue (Upper Canning) Current Pump & Flow Data Hole Condition On Bot Hrs Avg Diam PWD Slide f/996' t/1074' Rotate f/1381' t/1518' Rotate f/1195' t/1381' Casing and Liner On bottom with Bit #2. Resumed drilling. Slide f/707' t/786' Rotate f/ 786' t/996' Summary Operations Depth KB (MD) Rotate f/1703' t/1856' Flow In (spm) 187 Gallons/stroke 3.173 N/A N/A N/A N/A Water (% by volume):91%Chlorides (mg/l): 600 Shows Fluorescence iC5 & nC5 (ppm)iC4 & nC4 (ppm)C1 (ppm) 707'-1856' Formation Loose gravel, unconsolidated sands and clay. Lower Sagavanirktok Staines Tongue (Lower Sagavanirktok) Prince Creek Upper Schrader Bluff Lower Canning MCU (Mid Campanian Unconformity) Hue Shale Direct fluorescence comment Cut fluorescence comment No Sample Fluorescence Total Hardness (mg/l): 50 Rotate f/1518' t/1703' Mud type: SPUD Mud Rotate f/1074' t/1195' Depth (TVD) Kuparauk C Next 24 Hours Forecast (00h00 to 24h00) Depth (SSTVD) Ground Level = 558.162 m, RKB = 567.162 m. Origin Measurement Depths (MD) per foot from RKB. Spud date: 8/22/2012 Previous depth: 707' Representative: Shane McGeehan, Gus Gustafson Last deviation survey: 1712.85'/1712.66'/0.50/298.52 Geologist: Paul StilesDays since spud: 2 Total depth @ 24h00: 1856' Zone Thickness Drill to Casing point @ +/- 2500', Circulate, short trip, circulate, POOH, L/D tools, R/U casing equipment DAILY GEOLOGICAL AND OPERATIONS REPORT All measurement depths (MD) are quoted per foot from rotary kelly bushing (RKB) Coordinates: WELL : Merak 1 Ground Level: 174.7' Report date: 8/23/2012 Today's date: 8/24/2012 Kelly Bushing level (KB): 196.40' RIG: Nabors 105 Bit#2, life/footage: 19.7hrs/1149'ROP (min-max): 10-167 ft/hr Flow (gpm): 600 Stand pipe pressure (psi): 2495 Daily Progress: 1149' Longitude: 148° 42' 48.292 W Daily Charges: Total Charges: Average ROP: 44 ft/h Bit #2 16' Mill Tooth EBXT1GRC WOB (k): 15 RPM (Rot/min): 82 Current Operations Status (00h00 to 04h00) Drill Ahead from 1856' to 2027' prepare to pump 12 ppb walnut sweep. Casing shoe: size @ xxxft. Casing shoe: size @ xxxft. Total Gas (units) Summary lithological description and remarks C2 (ppm) Gas Shows and chromatographic analysis C3 (ppm) Latitude: 69° 58' 7.368 N Formation Tops Report number 5 Job No.:AK-AM-0009498071 Density: 9.6 Daily time-slot 00:00 - 03:00 03:00 - 06:00 06:00 - 09:00 09:00 - 12:00 12:00 - 14:20 14:20 - 16:30 16:30 - 20:00 20:00 - 22:00 22:00-24:00 Interval (ft) 1856'-2462' Max (Gas Test) Min Interval (ft) BHA Run #Bit Type Size TFA Hours Footage WOB RPM Condition #1/ Run 100 16"0.6995 #2/ Run 200 16"0.6995 ROP Current Avg 24 hr Max Max @ Ft R.O.P. (ft/hr)N/A 60 Depth Ann Corr Drilling Min N/A Avg N/A Max 2462 31.7 0 16"All Circ Min N/A Avg N/A Max 10555 10674 10674 10707 119 33 10555 10358 10477 10477 10510 10545 10664 10664 10697 7148 7335 7335 1258Lower Canning 10023 10210 10220 335 2046 667 Campanian Flooding Surface Middle Schrader Bluff 7057 7244 7244 4 307 Formation Tops in Red Surface Tops in Blue Undetermined Tops in Black Top Franklin Bluffs Member (Middle Sagavanirktok) Base Franklin Bluffs Member (Middle Sagavanirktok) 1183 1850 1379 7061 7248 7248 Gas Shows and chromatographic analysis C3 (ppm) Latitude: 69° 58' 7.368 N 12 13 51 Formation Tops From Wellsite Geologist 373 406 86 133 Total Gas (units) Summary lithological description and remarks C2 (ppm) 188 1275 1585 291 666 643 Pumped rice tracer (came back at 7200 strokes) Circulated and conditioned, Pulled out of hole to HWDP as of 04:00hrs Casing shoe: size @ xxxft. Casing shoe: size @ xxxft. 8593 8593 8999 484 207 1355 951 87 RIG: Nabors 105 Bit#2, life/footage: 31.7hrs/1755'ROP (min-max): 11-126 ft/hr Flow (gpm): N/A Stand pipe pressure (psi): N/A Daily Progress: 606' Longitude: 148° 42' 48.292 W Daily Charges: Total Charges: Bit #2 16' Mill Tooth EBXT1GRC DAILY GEOLOGICAL AND OPERATIONS REPORT All measurement depths (MD) are quoted per foot from rotary kelly bushing (RKB) Coordinates: WELL : Merak 1 Ground Level: 174.7' Report date: 8/24/2012 Today's date: 8/25/2012 Kelly Bushing level (KB): 196.40' Geologist: Paul StilesDays since spud: 2 Total depth @ 24h00: 2462' Zone Thickness L/D tools, R/U casing equipment, Run casing Average ROP: 60 ft/h WOB (k): N/A RPM (Rot/min): N/A Current Operations Status (00h00 to 04h00) Depth (SSTVD) Ground Level = 558.162 m, RKB = 567.162 m. Origin Measurement Depths (MD) per foot from RKB. 5644 5935 6601 Spud date: 8/22/2012 Previous depth: 1856' Representative: Shane McGeehan, Gus Gustafson Last deviation survey: 2416.13'/2415.93'/0.45/300.59 9903 Kuparauk C 10802 10812 Next 24 Hours Forecast (00h00 to 24h00) 691 951 2046 2784 4059 92189210 9222 9235 9285 9531 9230 9243 Depth (TVD) 9077 9210 0 484 9218 9085 9085 2046 1379 9077 9294 9540 9913 246 Total Hardness (mg/l): 40 Pull out of hole f/2462' to HWDP @ 707' Mud type: SPUD Mud Rotate f/2240' t/2369' 5644 5935 6601 8591 8591 8992 484 691 951 2046 2784 4059 9023 9035 9048 9098 9344 9716 8404 8404 8805 8890 8890 9023 2597 Direct fluorescence comment Cut fluorescence comment No Sample Fluorescence 1850 3872 5457 5748 6414 1856'-2462' Formation Clay, Sand, Silt, Claystone Lower Sagavanirktok Staines Tongue (Lower Sagavanirktok) Prince Creek Upper Schrader Bluff Lower Canning MCU (Mid Campanian Unconformity) Hue Shale N/A N/A N/A N/A Water (% by volume):91%Chlorides (mg/l): 600 Shows Fluorescence iC5 & nC5 (ppm) Flow In (spm) N/A Gallons/stroke N/A iC4 & nC4 (ppm)C1 (ppm) Casing and Liner Rotate f/1856' t/1998' Rotate f/1998' t/2086' increasing amounts of clay in samples and slower ROPs, pump high vis sweeps as needed. Summary Operations Depth KB (MD) -196 0 Trip in hole f/ HWDP @ 707' to 2238' Washed/Reamed f/2238' to bottom Rotate f/2086' t/2240' continue pumping sweeps as needed. Circulate and condition mud. Pump carbide tracer (returned to surface early at 5700 total strokes) pump high vis sweeps as needed Rotate f/2369' t/2462' surface casing point. 288 495 755 LCU (Lower Cretaceous Unconformity) Middle Sagavanirktok Permafrost Mikkelson Tongue (Upper Canning) Current Pump & Flow Data Hole Condition On Bot Hrs Avg Diam PWD Formation Tops/ Markers Holocene Gublik Top HRZ (Higly Radioactive Zone) Base HRZ Pebble Shale Kuparauk B Kuparauk A Miluveach Upper Kingak Lower Kingak TD Depth (ft)Gas type & remarks 2381 Bag Test @ Trap9983 3 8336 43 4170 0 2084 0 2095 & 2041 0 825 & 790 0 EBXT1GRC EBXT1GRC 8.2 31.7 Depth In Depth Out 116 707 707 2462 591 1755 10 10 50.000 70.000 4-4-WT-A-X-1-PN-PP 126 2228' Not cuts or shows Flow In (gpm) N/A SPP (psi) N/A Lower Kingak (K-1 Top) Lower Kingak Base Top Shublik Ivishak Base Shublik Fire Creek 10615 10358 10545 Report number 6 Job No.:AK-AM-0009498071 Density: 9.5 Daily time-slot 00:00 - 01:00 01:00 - 03:30 03:30 - 09:00 09:00 - 10:00 10:00 - 13:00 13:00 - 19:30 19:30 - 21:30 21:30 - 24:00 Interval (ft) Max Min Interval (ft) BHA Run #Bit Type Size TFA Hours Footage WOB RPM Condition #1/ Run 100 16"0.6995 #2/ Run 200 16"0.6995 ROP Current Avg 24 hr Max Max @ Ft R.O.P. (ft/hr)N/A N/A Depth Ann Corr Drilling Min N/A Avg N/A Max 2462 31.7 0 16"All Circ Min N/A Avg N/A Max Daily Charges: Total Charges: Lower Kingak (K-1 Top) Lower Kingak Base Top Shublik Ivishak Base Shublik Fire Creek 10615 10358 10545 N/A N/A Flow In (gpm) N/A SPP (psi) N/A 10 10 50.000 70.000 4-4-WT-A-X-1-PN-PP116707 707 2462 591 1755 0 0 0 0 EBXT1GRC EBXT1GRC 8.2 31.7 Depth In Depth Out 59 0 23 0 3 0 Lower Kingak TD Depth (ft)Gas type & remarks 2 0 Holocene Gublik Top HRZ (Higly Radioactive Zone) Base HRZ Pebble Shale Kuparauk B Mikkelson Tongue (Upper Canning) Current Pump & Flow Data Hole Condition On Bot Hrs Avg Diam PWD Kuparauk A Miluveach Upper Kingak L/D BHA and 8" directional tools from 155' to surface Run 13 3/8 casing to 1011' Rig up 13 3/8" casing running equipment. 288 495 755 Casing and Liner Circulate and condition hole Trip out of hole f/ 2462' t/155', work through tight spots:20k over@ 2368', 10k over@ 1450', 20k over @ 839', 25k over @ 695', 10k @ 655'. Summary Operations Depth KB (MD) -196 0 Run 13 3/8 casing to 1675' Flow In (spm) N/A Gallons/stroke N/A iC4 & nC4 (ppm)C1 (ppm) N/A N/A N/A N/A Water (% by volume):91%Chlorides (mg/l): 600 Shows Fluorescence iC5 & nC5 (ppm) Formation Lower Sagavanirktok Staines Tongue (Lower Sagavanirktok) Prince Creek Upper Schrader Bluff Lower Canning MCU (Mid Campanian Unconformity) Hue Shale Direct fluorescence comment Cut fluorescence comment 1850 3872 5457 5748 6414 LCU (Lower Cretaceous Unconformity) 8404 8404 8805 8890 8890 9023 9023 9035 9048 9098 9344 9716 8591 8591 8992 484 691 951 2046 2784 4059 9913 246 Total Hardness (mg/l): 40 Circulate and condition Mud type: SPUD Mud Rig up for 13 3/8" casing, preform dummy run with landing joint 5644 5935 6601 9077 9210 0 484 9218 9085 9085 2046 1379 9077 92189210 9222 9235 9285 9531 9230 9243 9294 9540 9903 Kuparauk C 10802 10812 Next 24 Hours Forecast (00h00 to 24h00) 691 951 2046 2784 4059 5644 5935 6601 Spud date: 8/22/2012 Previous depth: 1856' Representative: Shane McGeehan, Gus Gustafson Last deviation survey: 2416.13'/2415.93'/0.45/300.59 Depth (TVD) 2597 Geologist: Paul StilesDays since spud: 4 Total depth @ 24h00: 2462' Zone Thickness Rig up cementers. Cement 13 3/8" casing Average ROP: 60 ft/h WOB (k): N/A RPM (Rot/min): N/A Current Operations Status (00h00 to 04h00) DAILY GEOLOGICAL AND OPERATIONS REPORT All measurement depths (MD) are quoted per foot from rotary kelly bushing (RKB) Coordinates: WELL : Merak 1 Ground Level: 174.7' Report date: 8/25/2012 Today's date: 8/26/2012 Kelly Bushing level (KB): 196.40' RIG: Nabors 105 Bit#2, life/footage: 31.7hrs/1755'ROP (min-max): 11-126 ft/hr Flow (gpm): N/A Stand pipe pressure (psi): N/A Daily Progress: 606' Longitude: 148° 42' 48.292 W Bit #2 16' Mill Tooth EBXT1GRC Ran casing to 2450' Casing shoe: size @ xxxft. Casing shoe: size @ xxxft. 8593 8593 8999 484 207 1355 951 87 Total Gas (units) Summary lithological description and remarks C2 (ppm) 188 1275 1585 291 666 51 Formation Tops From Wellsite Geologist 373 406 86 133 643 Depth (SSTVD) 7061 7248 7248 Gas Shows and chromatographic analysis C3 (ppm) Latitude: 69° 58' 7.368 N 12 13 Formation Tops in Red Surface Tops in Blue Undetermined Tops in Black Top Franklin Bluffs Member (Middle Sagavanirktok) Base Franklin Bluffs Member (Middle Sagavanirktok) 1183 1850 1379 Ground Level = 558.162 m, RKB = 567.162 m. Origin Measurement Depths (MD) per foot from RKB. Middle Sagavanirktok Permafrost Formation Tops/ Markers 2046 667 Campanian Flooding Surface Middle Schrader Bluff 7057 7244 7244 4 7148 7335 7335 1258Lower Canning 10023 10210 10220 335 307 10555 10358 10477 10477 10510 10545 10664 10664 10697 10555 10674 10674 10707 119 33 Report number 7 Job No.:AK-AM-0009498071 Density: 9.5 Daily time-slot 00:00 - 03:00 03:00 - 05:30 05:30 - 07:00 07:00 - 10:00 10:00 - 12:00 12:00 - 13:00 13:00 - 13:30 13:30 - 17:30 17:30 - 18:00 18:00 - 19:00 19:00 - 21:00 21:00 - 24:00 Interval (ft) Max Min Interval (ft) BHA Run #Bit Type Size TFA Hours Footage WOB RPM Condition #1/ Run 100 16"0.6995 #2/ Run 200 16"0.6995 ROP Current Avg 24 hr Max Max @ Ft R.O.P. (ft/hr)N/A N/A Depth Ann Corr Drilling Min N/A Avg N/A Max 2462 31.7 0 16"All Circ Min N/A Avg N/A Max 10555 10674 10674 10707 119 33 10555 10358 10477 10477 10510 10545 10664 10664 10697 1258Lower Canning 10023 10210 10220 335 307 Campanian Flooding Surface Middle Schrader Bluff 7057 7244 7244 4 7148 7335 7335 Formation Tops in Red Surface Tops in Blue Undetermined Tops in Black Top Franklin Bluffs Member (Middle Sagavanirktok) Base Franklin Bluffs Member (Middle Sagavanirktok) 1183 1850 1379 Ground Level = 558.162 m, RKB = 567.162 m. Origin Measurement Depths (MD) per foot from RKB. Middle Sagavanirktok Permafrost Formation Tops/ Markers 7061 7248 7248 Gas Shows and chromatographic analysis C3 (ppm) Latitude: 69° 58' 7.368 N 12 13 51 Formation Tops From Wellsite Geologist 373 406 86 133 643 Depth (SSTVD) Total Gas (units) Summary lithological description and remarks C2 (ppm) 188 1275 1585 291 666 8593 8999 484 207 1355 951 87 2046 667 RIG: Nabors 105 Bit#2, life/footage: 31.7hrs/1755'ROP (min-max): Flow (gpm): N/A Stand pipe pressure (psi): N/A Daily Progress: 0' Longitude: 148° 42' 48.292 W DAILY GEOLOGICAL AND OPERATIONS REPORT All measurement depths (MD) are quoted per foot from rotary kelly bushing (RKB) Coordinates: WELL : Merak 1 Ground Level: 174.7' Report date: 8/26/2012 Today's date: 8/27/2012 Kelly Bushing level (KB): 196.40' 2597 Geologist: Paul StilesDays since spud: 5 Total depth @ 24h00: 2462' Zone Thickness Nipple down divertor, nipple up BOPs Average ROP: WOB (k): N/A RPM (Rot/min): N/A Spud date: 8/22/2012 Previous depth: 2462' Representative: Shane McGeehan, Gus Gustafson Last deviation survey: 2416.13'/2415.93'/0.45/300.59 Depth (TVD) Current Operations Status (00h00 to 04h00) Bit #2 16' Mill Tooth EBXT1GRC Lay down stinger tool, make up top pup joint to landing joint, lay down landing joint Casing shoe: 13 3/8" @ 2447 ft. Casing shoe: size @ xxxft. 10802 10812 Next 24 Hours Forecast (00h00 to 24h00) 691 951 2046 2784 4059 5644 5935 92189210 9222 9235 9285 9531 9230 9243 9294 9540 0 484 9218 9085 9085 2046 1379 9077 6601 8593 9913 246 Total Hardness (mg/l): 40 Clean cement plug from hard line and valve in cellar Mud type: SPUD Mud Trip in hole w/ 5" DP from surface t/2359'. Rig up cementing equip. Break circulation. Sting into float @ 2359' 5644 5935 6601 484 691 951 2046 2784 4059 9048 9098 9344 9716 8591 8591 8992 9077 9210 9903 8805 8890 8890 9023 9023 9035 Direct fluorescence comment Cut fluorescence comment 1850 3872 5457 5748 6414 LCU (Lower Cretaceous Unconformity) Lower Sagavanirktok Staines Tongue (Lower Sagavanirktok) Prince Creek Upper Schrader Bluff Lower Canning MCU (Mid Campanian Unconformity) Hue Shale 8404 8404 N/A N/A N/A N/A Water (% by volume):91%Chlorides (mg/l): 600 Shows Fluorescence iC5 & nC5 (ppm) rinse annular, riser and divertor, blow down cement line, lay down cement head Trip out of hole with 5" DP Flow In (spm) N/A Gallons/stroke N/A iC4 & nC4 (ppm)C1 (ppm) Casing and Liner Run 13 3/8" casing f/1675' t/2447' Circulate and condition @ 2447'. Clear casing equipment from rig floor. Summary Operations Depth KB (MD) -196 0 Pumped 5 bbls of water, 60 bbls of 10.5 ppg spacer, pumped 10.7 ppg lead cement, 82 bbls 15.8 ppg tail, 180 bbls of cement excess cement. Dropped wiper plug Circulate and condition, unsting from float, picked up f/ 2359' to 2336' circulate bottoms up Run casing back to upper landing joint. Change out bails. Pick up cement head Circulate and condition, pumped 40bbls citric/desco/bicarb Circulate and condition through cement stinger shoe @ 2441' @ 6 BPM 288 495 755 Hole Condition On Bot Hrs Avg Diam PWD Kuparauk A Miluveach Upper Kingak Formation Holocene Gublik Top HRZ (Higly Radioactive Zone) Base HRZ Pebble Shale Kuparauk B Mikkelson Tongue (Upper Canning) Kuparauk C Lower Kingak TD Depth (ft)Gas type & remarks 1 0 20 0 5 0 1 0 0 0 0 0 EBXT1GRC EBXT1GRC 8.2 31.7 Depth In Depth Out 116 707 707 2462 591 1755 SPP (psi) N/A 10 10 50.000 70.000 4-4-WT-A-X-1-PN-PP 6-5-WT-A-E-1-ER-TD Current Pump & Flow Data Fire Creek 10615 10358 10545 N/A N/A Flow In (gpm) N/A Daily Charges: Total Charges: Lower Kingak (K-1 Top) Lower Kingak Base Top Shublik Ivishak Base Shublik Report number 8 Job No.:AK-AM-0009498071 Density: 9.5 Daily time-slot 00:00 - 01:00 01:00 - 03:30 03:30 - 04:30 04:30 - 12:00 12:00 - 13:00 13:00 - 16:30 16:30 - 18:30 18:30 - 20:30 20:30 - 24:00 Interval (ft) Max Min Interval (ft) BHA Run #Bit Type Size TFA Hours Footage WOB RPM Condition #1/ Run 100 16"0.6995 #2/ Run 200 16"0.6995 ROP Current Avg 24 hr Max Max @ Ft R.O.P. (ft/hr)N/A N/A Depth Ann Corr Drilling Min N/A Avg N/A Max 2462 31.7 0 16"All Circ Min N/A Avg N/A Max Daily Charges: Total Charges: Lower Kingak (K-1 Top) Lower Kingak Base Top Shublik Ivishak Base Shublik Fire Creek 10615 10358 10545 N/A N/A Flow In (gpm) N/A SPP (psi) N/A 10 10 50.000 70.000 4-4-WT-A-X-1-PN-PP 6-5-WT-A-E-1-ER-TD Current Pump & Flow Data 116 707 707 2462 591 1755 0 0 0 0 EBXT1GRC EBXT1GRC 8.2 31.7 Depth In Depth Out 0 0 0 0 0 0 Lower Kingak TD Depth (ft)Gas type & remarks 0 0 Holocene Gublik Top HRZ (Higly Radioactive Zone) Base HRZ Pebble Shale Kuparauk B Mikkelson Tongue (Upper Canning) Kuparauk C Hole Condition On Bot Hrs Avg Diam PWD Kuparauk A Miluveach Upper Kingak Formation M/U stack wash tool, wash stack, L/D wash tool Vetco dressed threads on landing ring, installed surface head and NT2 adapter M/U LDS, Test surface head and casing head seals to 5000 psi Remove diverter tee from cellar 288 495 755 Casing and Liner L/D centralizer and stinger Pull and lay down landing joint Summary Operations Depth KB (MD) -196 0 Nipple up bottom rams and mud cross Hang annular, set dbl gate on dolly, set annular dbl gate and torque bolts, set annular and dbl gate on mud cross and torque bolts, M/U kill ine, Clean pits 3,4,5,6 Flow In (spm) N/A Gallons/stroke N/A iC4 & nC4 (ppm)C1 (ppm) N/A N/A N/A N/A Water (% by volume):91%Chlorides (mg/l): 600 Shows Fluorescence iC5 & nC5 (ppm) Lower Sagavanirktok Staines Tongue (Lower Sagavanirktok) Prince Creek Upper Schrader Bluff Lower Canning MCU (Mid Campanian Unconformity) Hue Shale 8404 8404 Direct fluorescence comment Cut fluorescence comment 1850 3872 5457 5748 6414 LCU (Lower Cretaceous Unconformity) 8805 8890 8890 9023 9023 9035 9048 9098 9344 9716 8591 8591 8992 9077 9210 9903 484 691 951 2046 2784 4059 9913 246 Total Hardness (mg/l): 40 Nipple up 13 5/8" 10M x 13 5/8" 5M adapter Mud type: SPUD Mud Remove divertor line, instal BOP trolly, remove riser, mouse hole, annular, and diverter tee 5644 5935 6601 9218 9085 9085 2046 1379 9077 6601 8593 9210 9222 9235 9285 9531 9230 9243 9294 9540 10802 10812 Next 24 Hours Forecast (00h00 to 24h00) 691 951 2046 2784 4059 5644 5935 Spud date: 8/22/2012 Previous depth: 2462' Representative: Shane McGeehan, Gus Gustafson Last deviation survey: 2416.13'/2415.93'/0.45/300.59 Depth (TVD) Current Operations Status (00h00 to 04h00) Bit #2 16' Mill Tooth EBXT1GRC Continued nippling up BOP Casing shoe: 13 3/8" @ 2447 ft. Casing shoe: size @ xxxft. 2597 Geologist: Paul StilesDays since spud: 6 Total depth @ 24h00: 2462' Zone Thickness Test BOP, Pick Up BHA Average ROP: WOB (k): N/A RPM (Rot/min): N/A DAILY GEOLOGICAL AND OPERATIONS REPORT All measurement depths (MD) are quoted per foot from rotary kelly bushing (RKB) Coordinates: WELL : Merak 1 Ground Level: 174.7' Report date: 8/27/2012 Today's date: 8/28/2012 Kelly Bushing level (KB): 196.40' RIG: Nabors 105 Bit#2, life/footage: 31.7hrs/1755'ROP (min-max): Flow (gpm): N/A Stand pipe pressure (psi): N/A Daily Progress: 0' Longitude: 148° 42' 48.292 W 484 207 1355 951 87 2046 667 0 484 Total Gas (units) Summary lithological description and remarks C2 (ppm) 188 1275 1585 291 666 Formation Tops From Wellsite Geologist 373 406 86 133 643 Depth (SSTVD) 8593 7061 7248 7248 Gas Shows and chromatographic analysis C3 (ppm) Latitude: 69° 58' 7.368 N 12 13 Formation Tops in Red Surface Tops in Blue Undetermined Tops in Black Top Franklin Bluffs Member (Middle Sagavanirktok) Base Franklin Bluffs Member (Middle Sagavanirktok) 1183 1850 1379 Ground Level = 558.162 m, RKB = 567.162 m. Origin Measurement Depths (MD) per foot from RKB. Middle Sagavanirktok Permafrost Formation Tops/ Markers Campanian Flooding Surface Middle Schrader Bluff 7057 7244 7244 4 7148 7335 7335 1258Lower Canning 10023 10210 10220 335 307 51 8999 9218 10555 10358 10477 10477 10510 10545 10664 10664 10697 10555 10674 10674 10707 119 33 Report number 9 Job No.:AK-AM-0009498071 Density: 9.2 Daily time-slot 00:00 - 06:00 06:00 - 07:30 07:30 - 10:30 10:30 - 12:00 12:00 - 13:00 13:00 - 20:30 20:30 - 21:30 21:30 - 22:30 22:30 - 24:00 Interval (ft) Max Min Interval (ft) BHA Run #Bit Type Size TFA Hours Footage WOB RPM Condition #2/ Run 200 16"0.6995 #3/ Run 300 12.25 0.8629 ROP Current Avg 24 hr Max Max @ Ft R.O.P. (ft/hr)N/A N/A Depth Ann Corr Drilling Min N/A Avg N/A Max All Circ Min N/A Avg N/A Max 10555 10674 10674 10707 119 33 10555 10358 10477 10477 10510 10545 10664 10664 10697 1258Lower Canning 10023 10210 10220 335 307 51 8999 9218 Campanian Flooding Surface Middle Schrader Bluff 7057 7244 7244 4 7148 7335 7335 Formation Tops in Red Surface Tops in Blue Undetermined Tops in Black Top Franklin Bluffs Member (Middle Sagavanirktok) Base Franklin Bluffs Member (Middle Sagavanirktok) 1183 1850 1379 Ground Level = 558.162 m, RKB = 567.162 m. Origin Measurement Depths (MD) per foot from RKB. Middle Sagavanirktok Permafrost Formation Tops/ Markers 7061 7248 7248 Gas Shows and chromatographic analysis C3 (ppm) Latitude: 69° 58' 7.368 N 12 13 Formation Tops From Wellsite Geologist 373 406 86 133 643 Depth (SSTVD) 8593 Total Gas (units) Summary lithological description and remarks C2 (ppm) 188 1275 1585 291 666 484 207 1355 951 87 2046 667 0 484 RIG: Nabors 105 Bit#3, life/footage: 0hrs/0'ROP (min-max): Flow (gpm): N/A Stand pipe pressure (psi): N/A Daily Progress: 0' Longitude: 148° 42' 48.292 W DAILY GEOLOGICAL AND OPERATIONS REPORT All measurement depths (MD) are quoted per foot from rotary kelly bushing (RKB) Coordinates: WELL : Merak 1 Ground Level: 174.7' Report date: 8/27/2012 Today's date: 8/28/2012 Kelly Bushing level (KB): 196.40' 2597 Geologist: Paul StilesDays since spud: 7 Total depth @ 24h00: 2462' Zone Thickness Trip in hole, shallow test, switch hole to LSND mud, casing pressure test, drill out cement + 10' leak off test, drill ahead Average ROP: WOB (k): N/A RPM (Rot/min): N/A Spud date: 8/22/2012 Previous depth: 2462' Representative: Shane McGeehan, Jay Murphy Last deviation survey: 2416.13'/2415.93'/0.45/300.59 Depth (TVD) Current Operations Status (00h00 to 04h00) Bit #3 12.25" HBDS FX56M Made up BHA, surface tested tools Casing shoe: 13 3/8" @ 2441 ft. Casing shoe: size @ xxxft. 10802 10812 Next 24 Hours Forecast (00h00 to 24h00) 691 951 2046 2784 4059 5644 5935 9210 9222 9235 9285 9531 9230 9243 9294 9540 9218 9085 9085 2046 1379 9077 6601 8593 9913 246 Total Hardness (mg/l): 120 Dummy run casing an verify hanger in well head Mud type: LSND Mud Test annular 250 low/2500 high, attempt next test, leak on blind ram door seal, drain stack open ram door 5644 5935 6601 484 691 951 2046 2784 4059 9048 9098 9344 9716 8591 8591 8992 9077 9210 9903 8805 8890 8890 9023 9023 9035 Direct fluorescence comment Cut fluorescence comment 1850 3872 5457 5748 6414 LCU (Lower Cretaceous Unconformity) Lower Sagavanirktok Staines Tongue (Lower Sagavanirktok) Prince Creek Upper Schrader Bluff Lower Canning MCU (Mid Campanian Unconformity) Hue Shale 8404 8404 N/A N/A N/A N/A Water (% by volume):96%Chlorides (mg/l): 10000 Shows Fluorescence iC5 & nC5 (ppm) Flow In (spm) N/A Gallons/stroke N/A iC4 & nC4 (ppm)C1 (ppm) Casing and Liner Rig up choke hose, rig up koomey lines, function test BOPE, install riser and mouse hole Change out lower rams from 4" to 5" Summary Operations Depth KB (MD) -196 0 L/D test tool, rig down testing equipment, clean rig floor/cellar, run wear ring, blow down surface equipment Pick up BHA, stage in shed, pick up motor and bit Pick up testing tools, remove ball valves from conductor, clear cellar, pick up test joint, make up dart valve, TIW, ported sub and test plug, set test plug, fill stack and lines with water Test BOP and valves 250 psi low/5000 psi high for 5 mins, test annular 250 low/2500 high, test witnessed by AOGCC Replace door seal on blind rams 288 495 755 Hole Condition On Bot Hrs Avg Diam PWD Kuparauk A Miluveach Upper Kingak Formation Holocene Gublik Top HRZ (Higly Radioactive Zone) Base HRZ Pebble Shale Kuparauk B Mikkelson Tongue (Upper Canning) Kuparauk C Lower Kingak TD Depth (ft)Gas type & remarks 0 0 0 0 EBXT1GRC FX56M 31.7 Depth In Depth Out 0 0 2462 1755 0 0 0 0 0 0 N/A 10 70.000 6-5-WT-A-E-1-ER-TD Current Pump & Flow Data 707 2462 10615 10358 10545 N/A N/A Flow In (gpm) N/A SPP (psi) Daily Charges: Total Charges: Lower Kingak (K-1 Top) Lower Kingak Base Top Shublik Ivishak Base Shublik Fire Creek Report number 10 Job No.:AK-AM-0009498071 Density: 9.2 Daily time-slot 00:00 - 04:30 04:30 - 05:30 05:30 - 08:30 08:30 - 10:30 10:30 - 11:00 11:00 - 12:00 12:00 - 14:00 14:00 - 14:30 14:30 - 15:30 15:30 - 18:00 18:00 - 21:00 21:00 - 24:00 Interval (ft) 2462'-3113' Max Min Interval (ft) BHA Run #Bit Type Size TFA Hours Footage WOB RPM Condition #2/ Run 200 16"0.6995 #3/ Run 300 12.25 0.8629 ROP Current Avg 24 hr Max Max @ Ft R.O.P. (ft/hr)85 86 Depth Ann Corr Drilling Min 9.51 Avg 9.64 Max 3113'7.2 30bbls All Circ Min 9.48 Avg 9.64 Max Daily Charges: Total Charges: Lower Kingak (K-1 Top) Lower Kingak Base Top Shublik Ivishak Base Shublik Fire Creek 10615 10358 10545 184 3018' No Cuts Flow In (gpm) 510 SPP (psi) 1270 10 70.000 6-5-WT-A-E-1-ER-TD Current Pump & Flow Data 707 2462 2462 1755 0 0 26 0 1 0 0 0 EBXT1GRC FX56M 31.7 Depth In Depth Out 2174 0 Lower Kingak TD Depth (ft)Gas type & remarks 3051 2462 18 0 Holocene Gublik Top HRZ (Higly Radioactive Zone) Base HRZ Pebble Shale Kuparauk B Mikkelson Tongue (Upper Canning) Kuparauk C Hole Condition On Bot Hrs Avg Diam PWD Kuparauk A Miluveach Upper Kingak Formation P/U 5" DP f/ 74' to 2348' Tag float collar @ 2359'. Drill out cement to 2427'. Pressure test casing to 3500 ps for 30 mins @ 2349', test good 288 495 755 Casing and Liner M/U 8" Directional BHA to 190', Surface test tools Trip into the hole f/ 190' to 741'. Shallow test tools @ 800 GPM Summary Operations Depth KB (MD) -196 0 Circulate and condition mud Perform LOT, observed 13.1 ppg EMW. R/D testing equipment. Rotate ahead f/ 2482' to 2634' Rotate ahead f/ 2634' to 2874' Rotate ahead f/ 2874' to 3113' Flow In (spm) 160 Gallons/stroke 3.173 iC4 & nC4 (ppm)C1 (ppm) Lowear Sagavanirktok 9.31 9.20 Water (% by volume):94%Chlorides (mg/l): 10000 Shows Fluorescence iC5 & nC5 (ppm) Claystone, Clay, loosely consolidated sandstone and sand. Common silty claystones/silty sandstones, thin coal stringers/ organic rich claystones Lower Sagavanirktok Staines Tongue (Lower Sagavanirktok) Prince Creek Upper Schrader Bluff Lower Canning MCU (Mid Campanian Unconformity) Hue Shale 8404 8404 Direct fluorescence comment Cut fluorescence comment No Fluor 1850 3872 5457 5748 6414 LCU (Lower Cretaceous Unconformity) 8805 8890 8890 9023 9023 9035 9048 9098 9344 9716 8591 8591 8992 9077 9210 9903 484 691 951 2046 2784 4059 9913 246 Total Hardness (mg/l): 200 Drill out shoe track and 20' of new formation f/ 2427' to 2482' Mud type: LSND Mud Take on 600bbls of LSND pumped 30 bbl water slug, high vis spacer, displace hole with 9.2ppg LSND @ 2348' 5644 5935 6601 9218 9085 9085 2046 1379 9077 6601 8593 9222 9235 9285 9531 9230 9243 9294 9540 10812 Next 24 Hours Forecast (00h00 to 24h00) 691 951 2046 2784 4059 5644 5935 9210 Spud date: 8/22/2012 Previous depth: 2462' Representative: Shane McGeehan, Jay Murphy Last deviation survey: 3051.08'/3050.87'/0.37/242.08 Depth (TVD) Current Operations Status (00h00 to 04h00) Bit #3 12.25" HBDS FX56M Continued to drill ahead f/ 3113' to 3366' Casing shoe: 13 3/8" @ 2441 ft. Casing shoe: size @ xxxft. 2597 Geologist: Paul StilesDays since spud: 7 Total depth @ 24h00: 3113' Zone Thickness Drill to 3500' Wipe hole to shoe, Continue to drill ahead. Average ROP: 96 ft/hr WOB (k): 0-4k RPM (Rot/min): 60 DAILY GEOLOGICAL AND OPERATIONS REPORT All measurement depths (MD) are quoted per foot from rotary kelly bushing (RKB) Coordinates: WELL : Merak 1 Ground Level: 174.7' Report date: 8/29/2012 Today's date: 8/30/2012 Kelly Bushing level (KB): 196.40' RIG: Nabors 105 Bit#3, life/footage: 7.5hrs/651'ROP (min-max): 3-184 ft/hr Flow (gpm): 510 Stand pipe pressure (psi): 1270 Daily Progress: 651' Longitude: 148° 42' 48.292 W 484 207 1355 951 87 2046 667 0 484 Total Gas (units) Summary lithological description and remarks C2 (ppm) 188 1275 1585 291 666 Formation Tops From Wellsite Geologist 373 406 86 133 643 Depth (SSTVD) 8593 7061 7248 7248 Gas Shows and chromatographic analysis C3 (ppm) Latitude: 69° 58' 7.368 N 12 13 Formation Tops in Red Surface Tops in Blue Undetermined Tops in Black Top Franklin Bluffs Member (Middle Sagavanirktok) Base Franklin Bluffs Member (Middle Sagavanirktok) 1183 1850 1379 Ground Level = 558.162 m, RKB = 567.162 m. Origin Measurement Depths (MD) per foot from RKB. Middle Sagavanirktok Permafrost Formation Tops/ Markers Campanian Flooding Surface Middle Schrader Bluff 7057 7244 7244 4 7148 7335 7335 1258Lower Canning 10023 10210 10220 335 307 51 8999 9218 10555 10358 10477 10477 10510 10545 10664 10664 10697 12 .25" 10555 10674 10674 10707 119 33 10802 Report number 11 Job No.:AK-AM-0009498071 Density: 9.2 Daily time-slot 00:00 - 05:50 05:50 - 08:30 08:30 - 10:30 10:30 - 13:00 13:00 - 16:00 16:00 - 19:00 19:00 - 24:00 Interval (ft) 3113'-4548' Max Min Interval (ft) BHA Run #Bit Type Size TFA Hours Footage WOB RPM Condition #2/ Run 200 16"0.6995 #3/ Run 300 12.25 0.8629 ROP Current Avg 24 hr Max Max @ Ft R.O.P. (ft/hr)-104.06 Depth Ann Corr Drilling Min 9.39 Avg 9.76 Max 4548 21.84 30bbls All Circ Min 9.38 Avg 9.83 Max Daily Charges: Total Charges: Lower Kingak (K-1 Top) Lower Kingak Base Top Shublik Ivishak Base Shublik Fire Creek 10615 10358 10545 278.72 4547' No Cuts Flow In (gpm) 423 SPP (psi) 850 10 70.000 6-5-WT-A-E-1-ER-TD Current Pump & Flow Data 707 2462 1755 0 0 36 0 0 0 EBXT1GRC FX56M 31.7 Depth In Depth Out 2462 Lower Kingak TD Depth (ft)Gas type & remarks 4496' 3113' 456 6 Gublik Top HRZ (Higly Radioactive Zone) Base HRZ Pebble Shale Kuparauk B Mikkelson Tongue (Upper Canning) Kuparauk C Hole Condition On Bot Hrs Avg Diam PWD Kuparauk A Miluveach Upper Kingak Formation Ran back into the hole to 3496' Rotate ahead f/ 3900' to 4166' Rotate ahead f/ 3657' to 3900' 288 495 755 Lowear Sagavanirktok Casing and Liner Rotate ahead f/ 3113' to 3496' Pulled out of the hole from 3496' to 2433' for wiper trip Summary Operations Depth KB (MD) -196 0Holocene Flow In (spm) 72 Gallons/stroke 3.173 iC4 & nC4 (ppm)C1 (ppm) 0 0 85089 40 9.57 9.57 Water (% by volume):94%Chlorides (mg/l): 10000 Shows Fluorescence iC5 & nC5 (ppm) Claystone. Common silty claystones/silty sandstones, thin coal stringers/ organic rich claystones, thin tuff stringers. Lower Sagavanirktok Staines Tongue (Lower Sagavanirktok) Prince Creek Upper Schrader Bluff Lower Canning MCU (Mid Campanian Unconformity) Hue Shale 8404 8404 Direct fluorescence comment Cut fluorescence comment No Fluor 1850 3872 5457 5748 6414 LCU (Lower Cretaceous Unconformity) 8805 8890 8890 9023 9023 9035 9048 9098 9344 9716 8591 8591 8992 9077 9210 9903 484 691 951 2046 2784 4059 9913 246 Total Hardness (mg/l): 200 Rotate ahead f/ 4166' to 4548.' Prepare to POOH for wiper trip. Mud type: LSND Mud Rotate ahead f/ 3496' to 3657' 5644 5935 6601 9218 9085 9085 2046 1379 9077 6601 8593 9222 9235 9285 9531 9230 9243 9294 9540 10812 Next 24 Hours Forecast (00h00 to 24h00) 691 951 2046 2784 4059 5644 5935 9210 Spud date: 8/22/2012 Previous depth: 3113' Representative: Shane McGeehan, Jay Murphy Last deviation survey: 4485.57'/4485.29'/0.56/196.80 Depth (TVD) Current Operations Status (00h00 to 04h00) Bit #3 12.25" HBDS FX56M Preparing to pull out of the hole for wiper trip Casing shoe: 13 3/8" @ 2441 ft. Casing shoe: size @ xxxft. 2597 Geologist: Paul StilesDays since spud: 8 Total depth @ 24h00: 4548 Zone Thickness Wiper trip. Continue to drill ahead. Average ROP: 104.06 WOB (k): 0-4k RPM (Rot/min): 80 DAILY GEOLOGICAL AND OPERATIONS REPORT All measurement depths (MD) are quoted per foot from rotary kelly bushing (RKB) Coordinates: WELL : Merak 1 Ground Level: 174.7' Report date: 8/30/2012 Today's date: 8/31/2012 Kelly Bushing level (KB): 196.40' RIG: Nabors 105 Bit#3, life/footage: 21.84hrs/2086'ROP (min-max): 10-278 Flow (gpm): 423 Stand pipe pressure (psi): 850 Daily Progress: 1435'' Longitude: 148° 42' 48.292 W 484 207 1355 951 87 2046 667 0 484 Total Gas (units) Summary lithological description and remarks C2 (ppm) 188 1275 1585 291 666 Formation Tops From Wellsite Geologist 373 406 86 133 643 Depth (SSTVD) 8593 7061 7248 7248 Gas Shows and chromatographic analysis C3 (ppm) Latitude: 69° 58' 7.368 N 12 13 Formation Tops in Red Surface Tops in Blue Undetermined Tops in Black Top Franklin Bluffs Member (Middle Sagavanirktok) Base Franklin Bluffs Member (Middle Sagavanirktok) 1183 1850 1379 Ground Level = 558.162 m, RKB = 567.162 m. Origin Measurement Depths (MD) per foot from RKB. Middle Sagavanirktok Permafrost Formation Tops/ Markers Campanian Flooding Surface Middle Schrader Bluff 7057 7244 7244 4 7148 7335 7335 1258Lower Canning 10023 10210 10220 335 307 51 8999 9218 10555 10358 10477 10477 10510 10545 10664 10664 10697 12 .25" 10555 10674 10674 10707 119 33 10802 Report number 12 Job No.:AK-AM-0009498071 Density: 9.35 Daily time-slot 00:00 - 02:00 02:00 - 03:30 03:30 - 05:00 05:00 - 08:00 08:00 - 11:00 11:00 - 14:00 14:00 - 18:00 18:00 - 23:00 23:00 - 24:00 Interval (ft) 3737'-5056'' Max Min Interval (ft) BHA Run #Bit Type Size TFA Hours Footage WOB RPM Condition #2/ Run 200 16"0.6995 #3/ Run 300 12.25 0.8629 ROP Current Avg 24 hr Max Max @ Ft R.O.P. (ft/hr)-89.21 Depth Ann Corr Drilling Min 9.56 Avg 9.69 Max 5056 34.99 30bbls All Circ Min 9.56 Avg 12.63 Max Rotate ahead f/ 5218' to 5506' Pump high vis sweep and circulate bottoms up in preparation for wiper trip. 12 .25" 10555 10674 10674 10707 119 33 10802 10555 10358 10477 10477 10510 10545 10664 10664 10697 1258Lower Canning 10023 10210 10220 335 307 51 8999 9218 Campanian Flooding Surface Middle Schrader Bluff 7057 7244 7244 4 7148 7335 7335 Formation Tops in Red Surface Tops in Blue Undetermined Tops in Black Top Franklin Bluffs Member (Middle Sagavanirktok) Base Franklin Bluffs Member (Middle Sagavanirktok) 1183 1850 1379 Ground Level = 558.162 m, RKB = 567.162 m. Origin Measurement Depths (MD) per foot from RKB. Middle Sagavanirktok Permafrost Formation Tops/ Markers 7061 7248 7248 Gas Shows and chromatographic analysis C3 (ppm) Latitude: 69° 58' 7.368 N 12 13 Formation Tops From Wellsite Geologist 373 406 86 133 643 Depth (SSTVD) 8593 Total Gas (units) Summary lithological description and remarks C2 (ppm) 520 1171 1585 291 666 484 207 1355 951 87 2046 667 0 484 RIG: Nabors 105 Bit#3, life/footage:34.99hrs/3044'ROP (min-max): 4-128 Flow (gpm): 557 Stand pipe pressure (psi): 1623 Daily Progress: 958'' Longitude: 148° 42' 48.292 W DAILY GEOLOGICAL AND OPERATIONS REPORT All measurement depths (MD) are quoted per foot from rotary kelly bushing (RKB) Coordinates: WELL : Merak 1 Ground Level: 174.7' Report date: 8/31/2012 Today's date: 9/01/2012 Kelly Bushing level (KB): 196.40' 2370 Geologist: Paul StilesDays since spud: 9 Total depth @ 24h00: 5506' Zone Thickness Wiper trip. Pick up 18 joints of drill pipe. TIH to bottom. Continue to drill ahead. Average ROP: 89.41 WOB (k): 0-11 RPM (Rot/min): 73 Spud date: 8/22/2012 Previous depth: 4548' Representative: Shane McGeehan, Jay Murphy Last deviation survey: 5443.81'/5443.32'/0.83°/93.27° Depth (TVD) Current Operations Status (00h00 to 04h00) Bit #3 12.25" HBDS FX56M Ciculate bottoms up in preparation for wiper trip and begin to POOH. Casing shoe: 13 3/8" @ 2441 ft. Casing shoe: size @ xxxft. 10812 Next 24 Hours Forecast (00h00 to 24h00) 691 951 2046 2566 3737 5644 5935 9210 9285 9531 9230 9243 9294 9540 9218 9085 9085 2046 1379 9077 6601 8593 9913 246 Total Hardness (mg/l): 180 Rotate ahead f/ 5026' to 5218' Mud type: LSND Mud Rotate ahead f/ 4548' to 4683' 5644 5935 6601 484 691 951 2046 2566 3737 9344 9716 8591 8591 8992 9077 9210 9903 9222 9235 8890 9023 9023 9035 9048 9098 No Fluor 1850 3541 5457 5748 6414 LCU (Lower Cretaceous Unconformity) 8805 8890 Siltstone, sandstone with interbedded coal stringers. Lower Sagavanirktok Staines Tongue (Lower Sagavanirktok) Prince Creek Upper Schrader Bluff Lower Canning MCU (Mid Campanian Unconformity) Hue Shale 8404 8404 9.4 9.40 Water (% by volume):94%Chlorides (mg/l): 8000 Shows Fluorescence iC5 & nC5 (ppm) Flow In (spm) 86 Gallons/stroke 3.173 iC4 & nC4 (ppm)C1 (ppm) 0 0 34827 1298 Lower Sagavanirktok Casing and Liner Pump high vis sweep and circulate bottoms up. Pulled out of the hole from 4548' to 3426' for wiper trip Summary Operations Depth KB (MD) -196 0Holocene Ran back into the hole to 4548'' Rotate ahead f/ 4839' to 5026' Rotate ahead f/ 4683' to 4839' 288 495 755 Hole Condition On Bot Hrs Avg Diam PWD Kuparauk A Miluveach Upper Kingak Formation Gublik Top HRZ (Higly Radioactive Zone) Base HRZ Pebble Shale Kuparauk B Mikkelson Tongue (Upper Canning) Kuparauk C Lower Kingak TD Depth (ft)Gas type & remarks 5505' 4548' 301 11 EBXT1GRC FX56M 31.7 Depth In Depth Out 2462 1755 0 0 33 0 0 0 Direct fluorescence comment Cut fluorescence comment 1097 10 70.000 6-5-WT-A-E-1-ER-TD Current Pump & Flow Data 707 2462 10615 10358 10545 128.38 5505' No Cuts Flow In (gpm) 479 SPP (psi) Daily Charges: Total Charges: Lower Kingak (K-1 Top) Lower Kingak Base Top Shublik Ivishak Base Shublik Fire Creek Report number 13 Job No.:AK-AM-0009498071 Density: 9.3 Daily time-slot 00:00 - 00:30 00:30 - 02:20 02:20 - 04:00 04:00 - 08:00 08:00 - 12:00 11:00 - 14:00 14:00 - 18:00 18:00 - 20:45 20:45 - 24:00 Interval (ft) Max Min Interval (ft) BHA Run #Bit Type Size TFA Hours Footage WOB RPM Condition #2/ Run 200 16"0.6995 #3/ Run 300 12.25 0.8629 ROP Current Avg 24 hr Max Max @ Ft R.O.P. (ft/hr)-93 Depth Ann Corr Drilling Min 9.63 Avg 9.71 Max 6560 47.5 30bbls All Circ Min 9.62 Avg 9.71 Max Daily Charges: Total Charges: Lower Kingak (K-1 Top) Lower Kingak Base Top Shublik Ivishak Base Shublik Fire Creek 10615 10358 10545 181 5852' No Cuts Flow In (gpm) 560 SPP (psi) 2080 10 70.000 6-5-WT-A-E-1-ER-TD Current Pump & Flow Data 707 2462 1755 81 & 102 0 2303 0 211 0 Direct fluorescence comment Cut fluorescence comment EBXT1GRC FX56M 31.7 Depth In Depth Out 2462 Lower Kingak TD Depth (ft)Gas type & remarks 6344' 5507' 291 2 Gublik Top HRZ (Higly Radioactive Zone) Base HRZ Pebble Shale Kuparauk B Mikkelson Tongue (Upper Canning) Kuparauk C Hole Condition On Bot Hrs Avg Diam PWD Kuparauk A Miluveach Upper Kingak Formation Single into hole w/ 18 jts DP f/4545' to 5116'. Continue to bottom with racked back stands of DP. Rotate ahead f/ 6020' to 6081' slide f/ 6081' to 6106' Rotate ahead f/ 5790' to 6020' 288 495 755 Casing and Liner circulate and condition, complete surface to surface strokes.. Pulled out of hole for short wiper trip from 5506' to 4545'. Summary Operations Depth KB (MD) -196 0Holocene Flow In (spm) 180 Gallons/stroke 3.173 iC4 & nC4 (ppm)C1 (ppm) 55 & 54 0 49013 44 9.54 9.43 Water (% by volume):93%Chlorides (mg/l): 8000 Shows Fluorescence iC5 & nC5 (ppm) Siltstone, sandstone with interbedded coal stringers. Lower Sagavanirktok Staines Tongue (Lower Sagavanirktok) Prince Creek Upper Schrader Bluff Lower Canning MCU (Mid Campanian Unconformity) Hue Shale 8404 8404 No Fluor 1850 3541 5324 5694 6270 LCU (Lower Cretaceous Unconformity) 8805 8890 8890 9023 9023 9035 9048 9098 9344 9716 8591 8591 8992 9077 9210 9903 9222 9235 484 691 951 2046 2566 3737 9913 246 Total Hardness (mg/l): 120 Rotate ahead f/ 6106' to 6291' Mud type: LSND Mud Rotate ahead f/ 5506'' to 5790' 5520 5890 6466 9218 9085 9085 2046 1379 9077 6466 8593 9285 9531 9230 9243 9294 9540 10812 Next 24 Hours Forecast (00h00 to 24h00) 691 951 2046 2566 3737 5520 5890 9210 Spud date: 8/22/2012 Previous depth: 5506' Representative: Shane McGeehan, Jay Murphy Last deviation survey: 6497.54'/6496.95'/0.77°/241.08° Depth (TVD) Current Operations Status (00h00 to 04h00) Bit #3 12.25" HBDS FX56M Back ream out of hole f/ 5779' to 5580' trip to 5495', Run to bottom resume drilling @ 02:50 hrs Casing shoe: 13 3/8" @ 2441 ft. Casing shoe: size @ xxxft. 2370 Geologist: Paul StilesDays since spud: 10 Total depth @ 24h00: 6560' Zone Thickness Drill ahead. Wipe hole at approx. 7500' Average ROP: 93 ft/hr WOB (k): 5-15k RPM (Rot/min): 78 avg DAILY GEOLOGICAL AND OPERATIONS REPORT All measurement depths (MD) are quoted per foot from rotary kelly bushing (RKB) Coordinates: WELL : Merak 1 Ground Level: 174.7' Report date: 9/01/2012 Today's date: 9/02/2012 Kelly Bushing level (KB): 196.40' RIG: Nabors 105 Bit#3, life/footage:47.5hrs/4098'ROP (min-max): 2-181 ft/hr Flow (gpm): 560 avg Stand pipe pressure (psi): 2080 avg Daily Progress: 1054' Longitude: 148° 42' 48.292 W 87 2046 667 0 484 291 666 484 207 1355 951 Depth (SSTVD) 8593 Total Gas (units) Summary lithological description and remarks C2 (ppm) 520 1171 1585 C3 (ppm) Latitude: 69° 58' 7.368 N 12 13 Formation Tops From Wellsite Geologist 373 406 Permafrost Formation Tops/ Markers 7061 7248 7248 Gas Shows and chromatographic analysis 86 133 643 7335 7335 Formation Tops in Red Surface Tops in Blue Undetermined Tops in Black Top Franklin Bluffs Member (Middle Sagavanirktok) Base Franklin Bluffs Member (Middle Sagavanirktok) 1183 1850 1379 Ground Level = 558.162 m, RKB = 567.162 m. Origin Measurement Depths (MD) per foot from RKB. Middle Sagavanirktok 8999 9218 Campanian Flooding Surface Middle Schrader Bluff 7057 7244 7244 4 7148 10664 10697 1258Lower Canning 10023 10210 10220 335 307 51 10802 10555 10358 10477 10477 10510 10545 10664 Rotate ahead f/ 6291' to 6560' Pump high vis sweep and circulate bottoms up, Wiper trip out of hole f/ 6560' to 5779' 12 .25" 10555 10674 10674 10707 119 33 Report number 14 Job No.:AK-AM-0009498071 Density: 9.4 Daily time-slot 00:00 - 02:45 02:45 - 06:00 06:00 - 09:00 09:00 - 12:00 12:00 - 15:00 15:00 - 18:00 18:00 - 20:30 20:30 - 22:00 22:00 - 24:00 Comments Interval (ft) Max Min Interval (ft) BHA Run #Bit Type Size TFA Hours Footage WOB RPM Condition #2/ Run 200 16"0.6995 #3/ Run 300 12.25 0.8629 ROP Current Avg 24 hr Max Max @ Ft R.O.P. (ft/hr)-78 Depth Ann Corr Drilling Min 9.64 Avg 9.78 Max 7613 61.8 30bbls All Circ Min 9.62 Avg 9.78 Max Total 24 hr mud losses downhole: 10 bbls, 115 bbls lost over shakers + solids control equipment Circulate and condition mud, pumped 26 bbl high visc sweep. Pulled out of hole for short wiper f/ 7613' to 7133' Began offlaoding 400 bbls of mud to vac trucks. 12 .25" 10555 10674 10674 10707 119 33 10802 10555 10358 10477 10477 10510 10545 10664 10023 10210 10220 335 307 51 Campanian Flooding Surface Middle Schrader Bluff 7063 7259 7259 2 7148 10664 10697 Formation Tops in Red Surface Tops in Blue Undetermined Tops in Black Top Franklin Bluffs Member (Middle Sagavanirktok) Base Franklin Bluffs Member (Middle Sagavanirktok) 1183 1850 1379 Ground Level = 558.162 m, RKB = 567.162 m. Origin Measurement Depths (MD) per foot from RKB. Middle Sagavanirktok Gas Shows and chromatographic analysis 86 133 793 7335 7335 8999 9218 1258 406 Permafrost Formation Tops/ Markers 7091 7287 7287 Lower Canning 1171 1783 C3 (ppm) Latitude: 69° 58' 7.368 N 12 13 Formation Tops From Wellsite Geologist 373 1355 951 Depth (SSTVD) 8593 Total Gas (units) Summary lithological description and remarks C2 (ppm) 520 26 2046 667 0 484 370 576 484 207 RIG: Nabors 105 Bit#3, life/footage:61.75hrs/5149'ROP (min-max): 13-116 ft/hr Flow (gpm): 560 avg Stand pipe pressure (psi): 2096 avg Daily Progress: 1053' Longitude: 148° 42' 48.292 W DAILY GEOLOGICAL AND OPERATIONS REPORT All measurement depths (MD) are quoted per foot from rotary kelly bushing (RKB) Coordinates: WELL : Merak 1 Ground Level: 174.7' Report date: 9/02/2012 Today's date: 9/03/2012 Kelly Bushing level (KB): 196.40' 2370 Geologist: Paul StilesDays since spud: 11 Total depth @ 24h00: 7613' Zone Thickness Bring on 200 more bbls of 9.5ppg mud. Continue to rotate/slide ahead to +/- 8600 for another short trip. Average ROP: 78 ft/hr WOB (k): 6- 10k RPM (Rot/min): 87 avg Spud date: 8/22/2012 Previous depth: 6560' Representative: Shane McGeehan, Jay Murphy Last Survey: 7548.95'/7548.24'/1.13°/290.38° Depth (TVD) Current Operations Status (00h00 to 04h00) Bit #3 12.25" HBDS FX56M Continue with wiper trip and offloading mud, Bring on 200 bbls of 9.5 ppg mud f/ trucks to active. RIH resume sliding @ 7613' @ 02:45 Casing shoe: 13 3/8" @ 2441 ft. Casing shoe: size @ xxxft. 10812 Next 24 Hours Forecast (00h00 to 24h00) 691 951 2046 2566 3737 5520 5890 9210 9285 9531 9230 9243 9294 9540 9218 9085 9085 2046 1379 9077 6466 8593 9913 246 Total Hardness (mg/l): 100 Rotate ahead f/ 7469' to 7613' Mud type: LSND Mud Rotated ahead f/ 6954'' to 7133'' 5520 5890 6466 484 691 951 2046 2566 3737 9344 9716 8591 8591 8992 9077 9210 9903 9222 9235 8890 9023 9023 9035 9048 9098 Wk mineral fluor/ Fluor Tuff 1850 3541 5324 5694 6270 LCU (Lower Cretaceous Unconformity) 8805 8890 Siltstone, sandstone with interbedded coal stringers. Lower Sagavanirktok Staines Tongue (Lower Sagavanirktok) Prince Creek Upper Schrader Bluff Lower Canning MCU (Mid Campanian Unconformity) Hue Shale 8404 8404 9.28 9.28 Water (% by volume):93%Chlorides (mg/l): 7500 Shows Fluorescence iC5 & nC5 (ppm) Flow In (spm) 180 Gallons/stroke 3.173 iC4 & nC4 (ppm)C1 (ppm) 87 / 99 0 / 0 53257 3133 Casing and Liner Continued Pulling out of hole for wiper trip, began pulling tight around 5779'. Back reamed f/ 5779' to 5580', Pulled to 5495'. Ran back to bottom. Rotated ahead f/ 6560' to 6783'. Summary Operations Depth KB (MD) -196 0Holocene Rotated ahead f/ 6783' to 6954' Rotate ahead f/ 7324' to 7469' ' Rotated ahead f/ 7133' to 7324' 288 495 755 Hole Condition On Bot Hrs Avg Diam PWD Kuparauk A Miluveach Upper Kingak Formation Gublik Top HRZ (Higly Radioactive Zone) Base HRZ Pebble Shale Kuparauk B Mikkelson Tongue (Upper Canning) Kuparauk C Lower Kingak TD Depth (ft)Gas type & remarks 6738 7610 364 22 EBXT1GRC FX56M 31.7 Depth In Depth Out 2462 1755 178 / 417 15 / 28 4299 186 1666 73 Direct fluorescence comment Cut fluorescence comment 2096 10 70.000 6-5-WT-A-E-1-ER-TD Current Pump & Flow Data 707 2462 10615 10358 10545 116 7265' No Cuts Flow In (gpm) 560 SPP (psi) Daily Charges: Total Charges: Lower Kingak (K-1 Top) Lower Kingak Base Top Shublik Ivishak Base Shublik Fire Creek Report number 15 Job No.:AK-AM-0009498071 Density: 9.5 Daily time-slot 00:00 - 02:30 02:30 - 06:00 06:00 - 09:00 09:00 - 12:00 12:00 - 15:00 15:00 - 18:00 18:00 - 21:00 21:00 - 24:00 Comments Interval (ft) Max Min Interval (ft) BHA Run #Bit Type Size TFA Hours Footage WOB RPM Condition #2/ Run 200 16"0.6995 #3/ Run 300 12.25 0.8629 ROP Current Avg 24 hr Max Max @ Ft R.O.P. (ft/hr)10 55 Depth Ann Corr Drilling Min 9.7 Avg 9.85 Max 8264'78.9 30bbls All Circ Min 9.71 Avg 9.85 Max 12 .25" 10555 10674 10674 10707 119 33 10802 10555 10358 10477 10477 10510 10545 10664 10023 10210 10220 335 3079716 51 Campanian Flooding Surface Middle Schrader Bluff 7063 7259 7259 2 7091 10664 10697 Formation Tops in Red Surface Tops in Blue Undetermined Tops in Black Top Franklin Bluffs Member (Middle Sagavanirktok) Base Franklin Bluffs Member (Middle Sagavanirktok) 1183 1850 1379 Ground Level = 558.162 m, RKB = 567.162 m. Origin Measurement Depths (MD) per foot from RKB. Middle Sagavanirktok Gas Shows and chromatographic analysis 86 133 793 7287 7287 8999 9218 1258 406 Permafrost Formation Tops/ Markers 7065 7261 7261 Lower Canning 1171 1783 8593 C3 (ppm) Latitude: 69° 58' 7.368 N 12 13 Formation Tops From Wellsite Geologist 373 1355 951 Depth (SSTVD) Total Gas (units) Summary lithological description and remarks C2 (ppm) 520 26 576 2370 10812 2046 667 0 484 370 484 207 691 951 RIG: Nabors 105 Bit#3, life/footage:78.9hrs/5802'ROP (min-max): 3 - 141 ft/hr Flow (gpm): 576 Stand pipe pressure (psi): 2109 Daily Progress: 651' Longitude: 148° 42' 48.292 W Geologist: Paul StilesDays since spud: 12 DAILY GEOLOGICAL AND OPERATIONS REPORT All measurement depths (MD) are quoted per foot from rotary kelly bushing (RKB) Coordinates: WELL : Merak 1 Ground Level: 174.7' Report date: 9/03/2012 Today's date: 9/04/2012 Kelly Bushing level (KB): 196.40' Total depth @ 24h00: 8264' Zone Thickness Continue to Slide/ Rotate ahead to top of Hue Shale @ estimated 8550' + 200' for casing point. Average ROP: 55 ft/hr WOB (k): 5- 8k RPM (Rot/min): 0 Next 24 Hours Forecast (00h00 to 24h00) Total 24 hr mud losses downhole: 30 bbls seepage , 246 bbls lost over shakers + solids control equipment Slide f/ 8230' - 8233', excess drag, back reamed stand, Rotated f/ 8233' - 8236', slide f/ 8236' - 8264' Spud date: 8/22/2012 Previous depth: 7613' Representative: Shane McGeehan, Jay Murphy Last Survey: 8219.23'/8218.35'/3.71°/335.07° Depth (TVD) Current Operations Status (00h00 to 04h00) Bit #3 12.25" HBDS FX56M Continued to slide/rotate ahead to 8384' Casing shoe: 13 3/8" @ 2441 ft. Casing shoe: size @ xxxft. 2046 2566 3737 5520 5890 9210 9218 9085 9085 9285 9531 9230 9243 9294 9540 2046 1379 9077 6466 8593 9913 9210 9903 9222 9235 246 Total Hardness (mg/l): 40 Slide f/ 8186' - 8230' Mud type: LSND Mud Rotate f/ 7839' - 8005' 5520 5890 6466 484 691 951 2046 2566 3737 9344 8591 8591 8992 90778890 9023 9023 9035 9048 9098 Wk mineral fluor/ Fluor Tuff 1850 3541 5324 5694 6270 LCU (Lower Cretaceous Unconformity) 8805 8890 Fine grained silty sandstone and silstone, occasional silty claystone. Lower Sagavanirktok Staines Tongue (Lower Sagavanirktok) Prince Creek Upper Schrader Bluff Lower Canning MCU (Mid Campanian Unconformity) Hue Shale 8404 8404 9.6 9.60 Water (% by volume):93%Chlorides (mg/l): 9000 Shows Fluorescence iC5 & nC5 (ppm) Flow In (spm) 184 Gallons/stroke 3.173 iC4 & nC4 (ppm)C1 (ppm) 33 / 36 0 / 0 17749 1990 Casing and Liner Short trip out f/7613' to 6460', tight spots @ 6938',6835',6735',6525' finished offloading mud, brought on 200 bbls mud, ran back to bottom Slide ahead f/ 7613'' to 7627' Rotate f/ 7627' to 7708'. Slide f/7708' - 7718'. Brought on 200 more bbls of 9.5 ppg mud. Summary Operations Depth KB (MD) -196 0Holocene Slide f/7718' - 7725'. Rotate f/ 7725' - 7839' Slide f/ 8099' - 8117', Rotate f/ 8117' - 8186' Rotate f/ 8005' - 8090', Begin build @ 8090', Slide f/ 8090' - 8099' 288 495 755 Hole Condition On Bot Hrs Avg Diam PWD Kuparauk A Miluveach Upper Kingak Formation Gublik Top HRZ (Higly Radioactive Zone) Base HRZ Pebble Shale Kuparauk B Mikkelson Tongue (Upper Canning) Kuparauk C Lower Kingak TD Depth (ft)Gas type & remarks 8024 8232 99 24 EBXT1GRC FX56M 31.7 Depth In Depth Out 2462 1755 85 / 137 16-Dec 970 111 472 78 Direct fluorescence comment Cut fluorescence comment 2109 10 70.000 6-5-WT-A-E-1-ER-TD Current Pump & Flow Data 707 2462 10615 10358 10545 141 7613' No discenr cut fluor above contamination fluor f/ mud additives Flow In (gpm) 575 SPP (psi) Daily Charges: Total Charges: Lower Kingak (K-1 Top) Lower Kingak Base Top Shublik Ivishak Base Shublik Fire Creek Report number 16 Job No.:AK-AM-0009498071 Density: 9.6 Daily time-slot 00:00 - 03:00 03:00 - 06:00 06:00 - 09:00 09:00 - 12:00 12:00 - 15:00 15:00 - 18:00 18:00 - 19:05 19:05 - 21:30 21:30 - 24:00 Comments Interval (ft) 7287-8480 8480-8750 Max Min Interval (ft) BHA Run #Bit Type Size TFA Hours Footage WOB RPM Condition #2/ Run 200 16"0.6995 #3/ Run 300 12.25 0.8629 ROP Current Avg 24 hr Max Max @ Ft R.O.P. (ft/hr)N/A 55 Depth Ann Corr Drilling Min 9.75 Avg 9.86 Max 8750 95.6 30bbls All Circ Min 9.75 Avg 9.86 Max Trip f/ 8750' - 7707'. Pumped 20bbl dry job. 12 .25" 10555 10674 10674 10707 119 33 10802 10555 10358 10477 10477 10510 10545 10664 10023 10210 10220 335 3079716 51 Campanian Flooding Surface Middle Schrader Bluff 7063 7259 7259 2 7091 10664 10697 Formation Tops in Red Surface Tops in Blue Undetermined Tops in Black Top Franklin Bluffs Member (Middle Sagavanirktok) Base Franklin Bluffs Member (Middle Sagavanirktok) 1183 1850 1379 Ground Level = 558.162 m, RKB = 567.162 m. Origin Measurement Depths (MD) per foot from RKB. Middle Sagavanirktok Gas Shows and chromatographic analysis 86 133 793 7287 7287 8999 9218 1193 406 Permafrost Formation Tops/ Markers 7065 7261 7261 Lower Canning 1171 1783 8480 C3 (ppm) Latitude: 69° 58' 7.368 N 12 13 Formation Tops From Wellsite Geologist 373 1355 951 Depth (SSTVD) Total Gas (units) Summary lithological description and remarks C2 (ppm) Hue Shale Brown-Gray silty, wavy laminated shale, common micas, mod calc, trc vis oil stain. Vis degassing in ctgs f/ 8700'-8750' 520 26 576 2370 10812 2046 667 0 484 370 484 207 691 951 RIG: Nabors 105 Bit#3, life/footage:95.6hrs/6288'ROP (min-max): 4 - 101 ft/hr Flow (gpm): 576 Stand pipe pressure (psi): 2225 Daily Progress: 486' Longitude: 148° 42' 48.292 W Geologist: Paul StilesDays since spud: 13 DAILY GEOLOGICAL AND OPERATIONS REPORT All measurement depths (MD) are quoted per foot from rotary kelly bushing (RKB) Coordinates: WELL : Merak 1 Ground Level: 174.7' Report date: 9/04/2012 Today's date: 9/05/2012 Kelly Bushing level (KB): 196.40' Total depth @ 24h00: 8750' Zone Thickness Continue short trip to casing shoe. RIH to bottom. Circulate bottoms up until hole is clean. POOH to L/D tools. Average ROP: 47 ft/hr WOB (k): 5- 10k RPM (Rot/min): 0- 80 Next 24 Hours Forecast (00h00 to 24h00) Total 24 hr mud losses downhole: 15 bbls seepage , 140.5 bbls lost over shakers + solids control equipment Pumped high visc sweep. Circulated bottoms up until mud was 9.6 ppg all around. Slow pumps. Survey. Monitor well: static. Spud date: 8/22/2012 Previous depth: 8264' Representative: Shane McGeehan, Jay Murphy Last Survey: 8687.33'/8682.14'/8.06°/330.88° Depth (TVD) Current Operations Status (00h00 to 04h00) Bit #3 12.25" HBDS FX56M Pulled out of the hole. Pulled tight at approx 6440', 5490', 5400'. Bit depth at 04:00 is 5350' Casing shoe: 13 3/8" @ 2441 ft. Casing shoe: size @ xxxft. 2046 2566 3737 5520 5890 9210 9218 9085 9085 9285 9531 9230 9243 9294 9540 2046 1379 9077 6466 8480 9913 9210 9903 9222 9235 246 Total Hardness (mg/l): 40 Rotate f/8710' - 8736' Slide f/ 8736' - 8747'. Rotate to 8750' MD Intermediate TD. Observed 1481 units of gas from formation @ 8716' mud cut f/ 9.6 ppg - 8.6 ppg with gas Mud type: LSND Mud Slide f/8483' - 8493'. Rotate f/8493' - 8568' 5520 5890 6466 484 691 951 2046 2566 3737 9344 8477 8477 8992 90778890 9023 9023 9035 9048 9098 dull, patchy yellow orange petro fluor 1850 3541 5324 5694 6270 LCU (Lower Cretaceous Unconformity) 8805 8890 Fine grained silty sandstone and silstone, occasional silty claystone. Lower Sagavanirktok Staines Tongue (Lower Sagavanirktok) Prince Creek Upper Schrader Bluff Lower Canning MCU (Mid Campanian Unconformity) Hue Shale 8280 8280 9.6 9.57 Water (% by volume):92%Chlorides (mg/l): 8500 Shows Fluorescence iC5 & nC5 (ppm) Flow In (spm) N/A Gallons/stroke 3.173 iC4 & nC4 (ppm)C1 (ppm) 211 / 253 0 / 0 185866 1778 Lower Canning Casing and Liner Slide f/8264' - 8282'. Rotate f/ 8282'- 8378' Slide f/8378' - 8415'. Summary Operations Depth KB (MD) -196 0Holocene Slide f/8415' - 8424'. Rotate f/8424' - 8472'. Slide f/ 8472' -8483' Rotate f/8646' - 8664'. Slide f/ 8664' - 8671'. Rotate f/ 8671' - 8710' Slide f/8568' - 8583'. Rotate f/ 8583'-8646' 288 495 755 Hole Condition On Bot Hrs Avg Diam PWD Kuparauk A Miluveach Upper Kingak 8480-8750 Formation Gublik Top HRZ (Higly Radioactive Zone) Base HRZ Pebble Shale Kuparauk B Mikkelson Tongue (Upper Canning) Kuparauk C Lower Kingak TD Depth (ft)Gas type & remarks 8716 8273 formation gas1481 21 EBXT1GRC FX56M 31.7 95.6 Depth In Depth Out 2462 8750 1755 6288 446 / 1782 15 / 20 11237 88 7276 69 Direct fluorescence comment Cut fluorescence comment N/A 10 8 70.000 61.000 6-5-WT-A-E-1-ER-TD Current Pump & Flow Data 707 2462 10615 10358 10545 141 7613' slow, transl, dull white cut fluor, slow v pl straw vis cut, dull yel res fluor Flow In (gpm) N/A SPP (psi) Daily Charges: Total Charges: Lower Kingak (K-1 Top) Lower Kingak Base Top Shublik Ivishak Base Shublik Fire Creek Report number 17 Job No.:AK-AM-0009498071 Density: 9.6 Daily time-slot 00:00 - 03:00 03:00 - 06:00 06:00 - 09:00 09:00 - 12:00 12:00 - 14:30 14:30 - 15:00 15:00 - 17:30 17:30 - 18:00 18:00 - 20:00 20:00 - 24:00 Comments Interval (ft) Max Min Interval (ft) BHA Run #Bit Type Size TFA Hours Footage WOB RPM Condition #2/ Run 200 16"0.6995 #3/ Run 300 12.25 0.8629 ROP Current Avg 24 hr Max Max @ Ft R.O.P. (ft/hr)N/A N/A Depth Ann Corr Drilling Min N/A Avg N/A Max 8750 95.6 30bbls All Circ Min 10.15 Avg 11.09 Max Circulate and condition mud, circulate bottoms up. Slip and cut 124' drill line. Inspect deadman clamp Daily Charges: Total Charges: Lower Kingak (K-1 Top) Lower Kingak Base Top Shublik Ivishak Base Shublik Fire Creek 10615 10358 10545 N/A N/A Flow In (gpm) N/A SPP (psi) N/A 10 8 70.000 61.000 6-5-WT-A-E-1-ER-TD Current Pump & Flow Data 707 2462 1755 6288 65/267 0 831 0 700 0 Direct fluorescence comment Cut fluorescence comment EBXT1GRC FX56M 31.7 95.6 Depth In Depth Out 2462 8750 Lower Kingak TD Depth (ft)Gas type & remarks While circulating91 0 Gublik Top HRZ (Higly Radioactive Zone) Base HRZ Pebble Shale Kuparauk B Mikkelson Tongue (Upper Canning) Kuparauk C Hole Condition On Bot Hrs Avg Diam PWD Kuparauk A Miluveach Upper Kingak Formation Trip out of hole f/5240' - 4835', still pulling tight. Began pumping and back reaming out f/4835' - 4353' Circulated and conditioned at 3209', Full returns. Back reamed to 3113' Continue to back ream out f/3411' - 3209', began packing off/limited return flow. 288 495 755 Casing and Liner Trip out of hole f/7707' - 6560'. Pulled tight @ 6560', 6464', 5962', 5854'. Continued tripping to 5550' Trip out of hole f/5550-5477'. Pulled tight @ 5477', Pulled tight @ 5347' rotated slow as needed and pull through 5347' - 5240' Summary Operations Depth KB (MD) -196 0Holocene Flow In (spm) N/A Gallons/stroke 3.173 iC4 & nC4 (ppm)C1 (ppm) 41/49 0 11639 0 N/A 9.86 Water (% by volume):91%Chlorides (mg/l): 8500 Shows Fluorescence iC5 & nC5 (ppm) Lower Sagavanirktok Staines Tongue (Lower Sagavanirktok) Prince Creek Upper Schrader Bluff Lower Canning MCU (Mid Campanian Unconformity) Hue Shale 8280 8280 1850 3541 5324 5694 6270 LCU (Lower Cretaceous Unconformity) 8805 8890 8890 9023 9023 9035 9048 9098 691 951 2046 2566 3737 9344 8477 8477 8992 9077 246 Total Hardness (mg/l): 40 Continue to back ream ot f/3113' - 2441' (Shoe) Mud type: LSND Mud Continue to back ream out f/4353' - 3411' 5520 5890 6466 484 2046 1379 9077 6466 8480 9913 9210 9903 9222 9235 9285 9531 9230 9243 9294 9540 2566 3737 5520 5890 9210 9218 9085 9085 Spud date: 8/22/2012 Previous depth: 8750' Representative: Mike Grubb, Jay Murphy Last Survey: 8687.33'/8682.14'/8.06°/330.88° Depth (TVD) Current Operations Status (00h00 to 04h00) Bit #3 12.25" HBDS FX56M Continued tripping into the hole, filling pipe every 1000'. Washed through tight spot @ 8375'. Currently @ 8470' Casing shoe: 13 3/8" @ 2441 ft. Casing shoe: size @ xxxft. Total depth @ 24h00: 8750' Zone Thickness Circulate and condition mud until clean returns. Pull out of hole to lay down directional tools. Average ROP: N/A WOB (k): N/A RPM (Rot/min): N/A Next 24 Hours Forecast (00h00 to 24h00) Total 24 hr mud losses downhole: 107 bbls , 82 bbls lost over shakers + solids control equipment Tripped in hole f/2441' - 4643' filling pipe @ 3400', 4360' DAILY GEOLOGICAL AND OPERATIONS REPORT All measurement depths (MD) are quoted per foot from rotary kelly bushing (RKB) Coordinates: WELL : Merak 1 Ground Level: 174.7' Report date: 9/05/2012 Today's date: 9/06/2012 Kelly Bushing level (KB): 196.40' RIG: Nabors 105 Bit#3, life/footage:95.6hrs/6288'ROP (min-max): N/A Flow (gpm): N/A Stand pipe pressure (psi): N/A Daily Progress: 0' Longitude: 148° 42' 48.292 W Geologist: Paul StilesDays since spud: 14 667 0 484 370 484 207 691 951 2046 Total Gas (units) Summary lithological description and remarks C2 (ppm) 520 26 576 2370 10812 8480 C3 (ppm) Latitude: 69° 58' 7.368 N 12 13 Formation Tops From Wellsite Geologist 373 1355 951 1193 406 Permafrost Formation Tops/ Markers 7065 7261 7261 Lower Canning 1171 1783 Gas Shows and chromatographic analysis 86 133 793 7287 7287 8999 9218 Formation Tops in Red Surface Tops in Blue Undetermined Tops in Black Top Franklin Bluffs Member (Middle Sagavanirktok) Base Franklin Bluffs Member (Middle Sagavanirktok) 1183 1850 1379 Ground Level = 558.162 m, RKB = 567.162 m. Origin Measurement Depths (MD) per foot from RKB. Middle Sagavanirktok Depth (SSTVD) 2046 51 Campanian Flooding Surface Middle Schrader Bluff 7063 7259 7259 2 7091 10664 10023 10210 10220 335 3079716 10802 10555 10358 10477 10477 10510 10545 10664 10697 12 .25" 10555 10674 10674 10707 119 33 Report number 18 Job No.:AK-AM-0009498071 Density: 9.7 Daily time-slot 00:00 - 03:00 03:00 - 06:00 06:00 - 09:00 09:00 - 12:00 12:00 - 15:00 15:00 - 16:30 16:30 - 21:00 21:00 - 21:30 21:30 - 23:00 23:00 - 24:00 Comments Interval (ft) Max Min Interval (ft) BHA Run #Bit Type Size TFA Hours Footage WOB RPM Condition #2/ Run 200 16"0.6995 #3/ Run 300 12.25 0.8629 ROP Current Avg 24 hr Max Max @ Ft R.O.P. (ft/hr)N/A N/A Depth Ann Corr Drilling Min N/A Avg N/A Max 8750 95.6 30bbls All Circ Min 10.15 Avg 11.09 Max 10477 3079716 12 .25" 10555 10674 10674 10707 119 33 10358 10477 N/A 9.86 10510 10545 10664 7259 7259 2 10802 10555 10697 10210 10220 335 10664 10023 Formation Tops in Red Surface Tops in Blue Undetermined Tops in Black Top Franklin Bluffs Member (Middle Sagavanirktok) Base Franklin Bluffs Member (Middle Sagavanirktok) 1183 1850 1379 Ground Level = 558.162 m, RKB = 567.162 m. Origin Measurement Depths (MD) per foot from RKB. Campanian Flooding Surface Middle Sagavanirktok Depth (SSTVD) 2046 Gas Shows and chromatographic analysis 86 133 793 7287 7287 8999 9218 51 406 Permafrost Formation Tops/ Markers 7065 7261 7261 Lower Canning 1171 1783 C3 (ppm) Latitude: 69° 58' 7.368 N 12 13 Formation Tops From Wellsite Geologist 373 1355 951 1193 Total Gas (units) Summary lithological description and remarks C2 (ppm) 520 26 576 2370 10812 667 0 484 370 484 207 691 951 2046 RIG: Nabors 105 Bit#3, life/footage:95.6hrs/6288'ROP (min-max): N/A Flow (gpm): N/A Stand pipe pressure (psi): N/A Daily Progress: 0' Longitude: 148° 42' 48.292 W DAILY GEOLOGICAL AND OPERATIONS REPORT All measurement depths (MD) are quoted per foot from rotary kelly bushing (RKB) Coordinates: WELL : Merak 1 Ground Level: 174.7' Report date: 9/06/2012 Zone Thickness Wireline Logging. Average ROP: N/A WOB (k): N/A RPM (Rot/min): N/A Water (% by volume):90% Today's date: 9/07/2012 Kelly Bushing level (KB): 196.40' Total depth @ 24h00: 8750' Geologist: Paul StilesDays since spud: 15 691 951 Next 24 Hours Forecast (00h00 to 24h00) Total 24 hr mud losses: 11 bbls lost over shakers + solids control equipment Clear rig floor, l/d single, blow down kill and choke lines. Begin loading wireline tools in pipe shed Spud date: 8/22/2012 Previous depth: 8750' Representative: Mike Grubb, Jay Murphy Last Survey: 8687.33'/8682.14'/8.06°/330.88° 9077 6466 Depth (TVD) Current Operations Status (00h00 to 04h00) Bit #3 12.25" HBDS FX56M Rig up wireline tools Casing shoe: 13 3/8" @ 2441 ft. Casing shoe: size @ xxxft. 2566 2046 1379 9294 9540 3737 5520 5890 9210 9218 9085 9085 8480 8480 9913 9210 9903 9222 9235 9285 9531 9230 9243 246 Total Hardness (mg/l): 40 Laid down BHA and directional tools. Downlink MWD tools and finish laying down BHA Mud type: LSND Mud Trip out of hole f/8750' - 6240', Minimal tight spots. 5520 5890 6466 484 2046 2566 3737 9344 8477 8477 8992 90778890 9023 9023 9035 9048 9098 48/49 0 59673 1850 3541 5324 5694 6270 LCU (Lower Cretaceous Unconformity) 8805 8890 Lower Sagavanirktok Staines Tongue (Lower Sagavanirktok) Prince Creek Upper Schrader Bluff Lower Canning MCU (Mid Campanian Unconformity) Hue Shale 8280 8280 7091 Middle Schrader Bluff 7063 Chlorides (mg/l): 9000 Shows Fluorescence iC5 & nC5 (ppm) Flow In (spm) N/A Gallons/stroke 3.173 iC4 & nC4 (ppm)C1 (ppm) 0 Casing and Liner Tripped in hole f/4643' - 7640' filling pipe @ 5525', 6490', and 7450' Tripped in hole f/7640' - 8733' rotate and washed f/8733' to bottom. Begin circulating hole clean. Summary Operations Depth KB (MD) -196 0Holocene Circulated bottoms up and circulated until returns at shakers were clean. Max gas while circulating was 416 units Trip out of hole f/2441' - 190'. Trip out of hole f/6240' - 2441', Minimal tight spots. Monitor well at shoe, well static. 288 495 755 Hole Condition On Bot Hrs Avg Diam PWD Kuparauk A Miluveach Upper Kingak Formation Gublik Top HRZ (Higly Radioactive Zone) Base HRZ Pebble Shale Kuparauk B Mikkelson Tongue (Upper Canning) Kuparauk C Lower Kingak TD Depth (ft)Gas type & remarks While circulating416 0 Direct fluorescence comment Cut fluorescence comment EBXT1GRC FX56M 31.7 95.6 Depth In Depth Out 2462 8750 707 2462 1755 6288 120/352 0 2228 0 1339 0 N/A SPP (psi) N/A 10 8 70.000 61.000 6-5-WT-A-E-1-ER-TD Current Pump & Flow Data Base Shublik Fire Creek 10615 10358 10545 N/A N/A Flow In (gpm) Install/Remove wear bushing, pull wear ring, clean and clear floor. P/U single, P/U test plug, flush stack, R/U testing equip, test blind rams to 250 low/5000 high for 5 mins, r/d testing equip. Daily Charges: Total Charges: Lower Kingak (K-1 Top) Lower Kingak Base Top Shublik Ivishak Report number 19 Job No.:AK-AM-0009498071 Density: 9.7 Daily time-slot 00:00 - 02:30 02:30 - 04:00 04:00 - 12:00 12:00 - 13:30 13:30 - 18:30 18:30 - 20:00 20:00 - 21:30 21:30 - 24:00 Comments Interval (ft) Max Min Interval (ft) BHA Run #Bit Type Size TFA Hours Footage WOB RPM Condition #2/ Run 200 16"0.6995 #3/ Run 300 12.25 0.8629 ROP Current Avg 24 hr Max Max @ Ft R.O.P. (ft/hr)N/A N/A Depth Ann Corr Drilling Min N/A Avg N/A Max 8750 95.6 30bbls All Circ Min N/A Avg N/A Max Begin BOP test. Test annular to 250/2500 psi. continue testing rest of BOPs to 250/5000 psi Daily Charges: Total Charges: Lower Kingak (K-1 Top) Lower Kingak Base Top Shublik Ivishak Base Shublik Fire Creek 10615 10358 10545 N/A N/A Flow In (gpm) N/A SPP (psi) N/A 10 8 70.000 61.000 6-5-WT-A-E-1-ER-TD 1-2-CT-A-X-I-BT-TD Current Pump & Flow Data 0 0 2228 0 0 0 2462 8750 707 2462 1755 6288 0 0 Direct fluorescence comment Cut fluorescence comment EBXT1GRC FX56M 31.7 95.6 Depth In Depth Out Depth (ft)Gas type & remarks Formation Gublik Top HRZ (Higly Radioactive Zone) Base HRZ Pebble Shale Kuparauk B Mikkelson Tongue (Upper Canning) Kuparauk C Lower Kingak TD 565 Hole Condition On Bot Hrs Avg Diam PWD Kuparauk A Miluveach Upper Kingak Holocene Pull out of hole with triple combo GEM logs. Rig down wireline tools Run in hole with wave sonic to 8720' @ 30-60 ft/ minute, log up f/ 8720' at slow rate. 288 495 0 Casing and Liner Rig up sheaves and rig up wireline tools Run in hole with triple combo GEM Summary Operations Depth KB (MD) -196 0 Chlorides (mg/l): 9000 Shows Fluorescence iC5 & nC5 (ppm) Flow In (spm) N/A Gallons/stroke 3.173 iC4 & nC4 (ppm)C1 (ppm) Prince Creek Upper Schrader Bluff Lower Canning MCU (Mid Campanian Unconformity) Hue Shale 8280 8280 7196 Middle Schrader Bluff 7062 1850 3536 5324 5696 6254 LCU (Lower Cretaceous Unconformity) 8805 8890 Lower Sagavanirktok Staines Tongue (Lower Sagavanirktok) 9023 9035 9048 9098 0 0 0 2046 2566 3732 9344 8477 8477 8992 90778890 9023 246 Total Hardness (mg/l): 40 Drain stack, pull wear ring, install test plug Mud type: LSND Mud C/O wireline tools. M/U wave sonic tool 5520 5892 6450 484 9913 9210 9903 9222 9235 9285 9531 9230 9243 1379 9294 9540 3732 5520 5892 9218 9085 9085 8480 Representative: Mike Grubb, Jay Murphy Last Survey: 8687.33'/8682.14'/8.06°/330.88° 9077 6450 Depth (TVD) Current Operations Status (00h00 to 04h00) Bit #3 12.25" HBDS FX56M Finish BOP testing. Casing shoe: 13 3/8" @ 2441 ft. Casing shoe: size @ xxxft. 2566 Geologist: Paul StilesDays since spud: 16 691 761 Next 24 Hours Forecast (00h00 to 24h00) Spud date: 8/22/2012 Zone Thickness Rig down testing equipment. M/U cleanout BHA, RIH for cleanout. Average ROP: N/A WOB (k): N/A RPM (Rot/min): N/A Water (% by volume):90% Total depth @ 24h00: 8750' DAILY GEOLOGICAL AND OPERATIONS REPORT All measurement depths (MD) are quoted per foot from rotary kelly bushing (RKB) Coordinates: WELL : Merak 1 Ground Level: 174.7' Report date: 9/07/2012 Today's date: 9/08/2012 Kelly Bushing level (KB): 196.40' RIG: Nabors 105 Bit#3, life/footage:95.6hrs/6288'ROP (min-max): N/A Flow (gpm): N/A Stand pipe pressure (psi): N/A Daily Progress: 0' Longitude: 148° 42' 48.292 W Previous depth: 8750' 558 2370 10812 667 0 484 372 484 207 1355 761 1193 Total Gas (units) Summary lithological description and remarks C2 (ppm) 520 131 1166 1788 C3 (ppm) Latitude: 69° 58' 7.368 N 12 13 Formation Tops From Wellsite Geologist 373 Permafrost Formation Tops/ Markers 7065 7261 7261 Lower Canning 691 761 2046 2046 7392 7392 8999 9218 51 406 9210 8480 Ground Level = 558.162 m, RKB = 567.162 m. Origin Measurement Depths (MD) per foot from RKB. Campanian Flooding Surface Middle Sagavanirktok Depth (SSTVD) 2046 Gas Shows and chromatographic analysis 86 133 808 10220 335 10664 10023 Formation Tops in Red Surface Tops in Blue Undetermined Tops in Black Top Franklin Bluffs Member (Middle Sagavanirktok) Base Franklin Bluffs Member (Middle Sagavanirktok) 1183 1850 1379 10545 10664 7258 7258 3 10802 10555 10697 10210 33 10358 10477 N/A N/A 10510 10477 3079716 12 .25" 10555 10674 10674 10707 119 Report number 20 Job No.:AK-AM-0009498071 Density: 9.75 Daily time-slot 00:00 - 04:00 04:00 - 05:30 05:30 - 07:45 07:45 - 09:30 09:30 - 10:00 10:00 - 12:00 12:00 - 16:00 16:00 - 19:30 19:30 - 24:00 Comments Interval (ft) Max Min Interval (ft) BHA Run #Bit Type Size TFA Hours Footage WOB RPM Condition #2/ Run 200 16"0.6995 #3/ Run 300 12.25 0.8629 ROP Current Avg 24 hr Max Max @ Ft R.O.P. (ft/hr)N/A N/A Depth Ann Corr Drilling Min N/A Avg N/A Max 8750 95.6 30bbls All Circ Min N/A Avg N/A Max 10477 3079716 12 .25" 10555 10674 10674 10707 119 33 10358 10477 N/A N/A 10510 10545 10664 7258 7258 3 10802 10555 10697 10210 10220 335 10664 10023 Formation Tops in Red Surface Tops in Blue Undetermined Tops in Black Top Franklin Bluffs Member (Middle Sagavanirktok) Base Franklin Bluffs Member (Middle Sagavanirktok) 1183 1850 1379 Ground Level = 558.162 m, RKB = 567.162 m. Origin Measurement Depths (MD) per foot from RKB. Campanian Flooding Surface Middle Sagavanirktok Depth (SSTVD) 2046 Gas Shows and chromatographic analysis 86 133 808 7392 7392 8999 9218 51 406 9210 8480 Permafrost Formation Tops/ Markers 7065 7261 7261 Lower Canning 691 761 2046 2046 1166 1788 C3 (ppm) Latitude: 69° 58' 7.368 N 12 13 Formation Tops From Wellsite Geologist 373 1355 761 1193 Total Gas (units) Summary lithological description and remarks C2 (ppm) 520 131 558 2370 10812 667 0 484 372 484 207 RIG: Nabors 105 Bit#3, life/footage:95.6hrs/6288'ROP (min-max): N/A Flow (gpm): N/A Stand pipe pressure (psi): N/A Daily Progress: 0' Longitude: 148° 42' 48.292 W Previous depth: 8750' DAILY GEOLOGICAL AND OPERATIONS REPORT All measurement depths (MD) are quoted per foot from rotary kelly bushing (RKB) Coordinates: WELL : Merak 1 Ground Level: 174.7' Report date: 9/08/2012 Today's date: 9/09/2012 Kelly Bushing level (KB): 196.40' Zone Thickness L/D BHA. Clear floor, Rig up 9 5/8" casing equipment, run 9 5/8" casing Average ROP: N/A WOB (k): N/A RPM (Rot/min): N/A Water (% by volume):90% Total depth @ 24h00: 8750' Geologist: Paul StilesDays since spud: 17 691 761 Next 24 Hours Forecast (00h00 to 24h00) Spud date: 8/22/2012 Representative: Mike Grubb, Jay Murphy Last Survey: 8687.33'/8682.14'/8.06°/330.88° 9077 6450 Depth (TVD) Current Operations Status (00h00 to 04h00) Bit #3 12.25" HBDS FX56M Continued tripping out of the hole f/5130' - 650', No tight spots Casing shoe: 13 3/8" @ 2441 ft. Casing shoe: size @ xxxft. 2566 1379 9294 9540 3732 5520 5892 9218 9085 9085 8480 9913 9210 9903 9222 9235 9285 9531 9230 9243 246 Total Hardness (mg/l): 40 Tripped in hole f/5000' - 8692' filling pipe every 2000', tight spots @ 7170' and 8628' Mud type: LSND Mud Tripped in hole to shoe at 2441' 5520 5892 6450 484 2046 2566 3732 9344 8477 8477 8992 90778890 9023 9023 9035 9048 9098 71/87 0 28803 1850 3536 5324 5696 6254 LCU (Lower Cretaceous Unconformity) 8805 8890 Lower Sagavanirktok Staines Tongue (Lower Sagavanirktok) Prince Creek Upper Schrader Bluff Lower Canning MCU (Mid Campanian Unconformity) Hue Shale 8280 8280 7196 Middle Schrader Bluff 7062 Chlorides (mg/l): 9000 Shows Fluorescence iC5 & nC5 (ppm) Flow In (spm) N/A Gallons/stroke 3.173 iC4 & nC4 (ppm)C1 (ppm) 0 Casing and Liner Test BOPs & equipment to 250/5000 psi. Test gas alarms, koomey, PVT and flow alarms Rigged down testing equipment, installed wear bushing, blow down choke and kill lines Summary Operations Depth KB (MD) -196 0Holocene M/U BHA, install float, gauged stabilizers Tripped in hole from shoe to 5000', filled pipe every 1500' Filled pipe @ shoe. 288 495 565 Hole Condition On Bot Hrs Avg Diam PWD Kuparauk A Miluveach Upper Kingak Formation Gublik Top HRZ (Higly Radioactive Zone) Base HRZ Pebble Shale Kuparauk B Mikkelson Tongue (Upper Canning) Kuparauk C Lower Kingak TD Depth (ft)Gas type & remarks Bottoms up Max trip gas214 0 Direct fluorescence comment Cut fluorescence comment EBXT1GRC FX56M 31.7 95.6 Depth In Depth Out 2462 8750 707 2462 1755 6288 130/424 0 1558 0 1290 0 N/A SPP (psi) N/A 10 8 70.000 61.000 6-5-WT-A-E-1-ER-TD 1-2-CT-A-X-I-BT-TD Current Pump & Flow Data Base Shublik Fire Creek 10615 10358 10545 N/A N/A Flow In (gpm) Circulated and conditioned. Circulated 34772 total str4okes, pumped 2 high vis sweeps until returns were clean, max gas was 214 units. Tripped out of hole. Pulled 5 stands. Pumped dry job. Tripped f/8750' - 5130', No tight spots Daily Charges: Total Charges: Lower Kingak (K-1 Top) Lower Kingak Base Top Shublik Ivishak Report number 21 Job No.:AK-AM-0009498071 Density: 9.75 Daily time-slot 00:00 - 02:30 02:30 - 04:15 04:15 - 07:30 07:00 - 08:45 08:45 - 11:00 11:00 - 12:00 12:00 - 12:30 12:30 - 13:00 13:00 - 16:30 16:30 - 17:30 17:30 - 22:00 22:00 - 22:30 22:30 - 24:00 Comments Interval (ft) Max Min Interval (ft) BHA Run #Bit Type Size TFA Hours Footage WOB RPM Condition #2/ Run 200 16"0.6995 #3/ Run 300 12.25 0.8629 ROP Current Avg 24 hr Max Max @ Ft R.O.P. (ft/hr)N/A N/A Depth Ann Corr Drilling Min N/A Avg N/A Max 8750 95.6 30bbls All Circ Min N/A Avg N/A Max Start running 9 5/8" casing to 2411' filling each joint as needed Circulated bottoms up at shoe. L/D test tool, test joint and test plug Rig up casing tools and stabbing board, pre-job safety meeting with all hands Daily Charges: Total Charges: Lower Kingak (K-1 Top) Lower Kingak Base Top Shublik Ivishak Base Shublik Fire Creek 10615 10358 10545 N/A N/A Flow In (gpm) N/A SPP (psi) N/A 10 8 70.000 61.000 6-5-WT-A-E-1-ER-TD 1-2-CT-A-X-I-BT-TD Current Pump & Flow Data 2462 8750 707 2462 1755 6288 28 Direct fluorescence comment Cut fluorescence comment EBXT1GRC FX56M 31.7 95.6 Depth In Depth Out Depth (ft)Gas type & remarks Circulating Gas Formation Gublik Top HRZ (Higly Radioactive Zone) Base HRZ Pebble Shale Kuparauk B Mikkelson Tongue (Upper Canning) Kuparauk C Lower Kingak TD 565 Hole Condition On Bot Hrs Avg Diam PWD Kuparauk A Miluveach Upper Kingak Holocene Lay Down BHA Start testing rams, trouble shoot chart recorder, repair and resumed test Change out rams to 9 5/8" fixed rams 288 495 Casing and Liner Trip out of the hole f/5341'-2365' Monitor well at shoe, well static continue to POOH to BHA Summary Operations Depth KB (MD) -196 0 Chlorides (mg/l): 9000 Shows Fluorescence iC5 & nC5 (ppm) Flow In (spm) N/A Gallons/stroke 3.173 iC4 & nC4 (ppm)C1 (ppm) Prince Creek Upper Schrader Bluff Lower Canning MCU (Mid Campanian Unconformity) Hue Shale 8280 8280 7196 Middle Schrader Bluff 7062 1850 3536 5324 5696 6254 LCU (Lower Cretaceous Unconformity) 8805 8890 Lower Sagavanirktok Staines Tongue (Lower Sagavanirktok) 9023 9035 9048 9098 2046 2566 3732 9344 8477 8477 8992 90778890 9023 246 Total Hardness (mg/l): 40 Test 9 5/8" pipe rams 250/3500 psi Mud type: LSND Mud Removed wear bushing, set test plug, start to R/U casing equipment. 5520 5892 6450 484 9913 9210 9903 9222 9235 9285 9531 9230 9243 1379 9294 9540 3732 5520 5892 9218 9085 9085 8480 Representative: Mike Grubb, Jay Murphy Last Survey: 8687.33'/8682.14'/8.06°/330.88° 9077 6450 Depth (TVD) Current Operations Status (00h00 to 04h00) Bit #3 12.25" HBDS FX56M Continued running casing/filling each joint to 5110' Casing shoe: 13 3/8" @ 2441 ft. Casing shoe: size @ xxxft. 2566 Geologist: Paul StilesDays since spud: 18 691 761 Next 24 Hours Forecast (00h00 to 24h00) M/U shoe track with baker lock, filled pipe, checked float Spud date: 8/22/2012 Zone Thickness Finish Running 9 5/8" casing. Rig up cementers, Cement 9 5/8" casing. Average ROP: N/A WOB (k): N/A RPM (Rot/min): N/A Continueded running casing from 2411' to 3078' as of 24:00hrs Water (% by volume):90% Total depth @ 24h00: 8750' DAILY GEOLOGICAL AND OPERATIONS REPORT All measurement depths (MD) are quoted per foot from rotary kelly bushing (RKB) Coordinates: WELL : Merak 1 Ground Level: 174.7' Report date: 9/09/2012 Today's date: 9/10/2012 Kelly Bushing level (KB): 196.40' RIG: Nabors 105 Bit#3, life/footage:95.6hrs/6288'ROP (min-max): N/A Flow (gpm): N/A Stand pipe pressure (psi): N/A Daily Progress: 0' Longitude: 148° 42' 48.292 W Previous depth: 8750' 558 2370 10812 667 0 484 372 484 207 1355 761 1193 Total Gas (units) Summary lithological description and remarks C2 (ppm) 520 131 1166 1788 C3 (ppm) Latitude: 69° 58' 7.368 N 12 13 Formation Tops From Wellsite Geologist 373 Permafrost Formation Tops/ Markers 7065 7261 7261 Lower Canning 691 761 2046 2046 7392 7392 8999 9218 51 406 9210 8480 Ground Level = 558.162 m, RKB = 567.162 m. Origin Measurement Depths (MD) per foot from RKB. Campanian Flooding Surface Middle Sagavanirktok Depth (SSTVD) 2046 Gas Shows and chromatographic analysis 86 133 808 10220 335 10664 10023 Formation Tops in Red Surface Tops in Blue Undetermined Tops in Black Top Franklin Bluffs Member (Middle Sagavanirktok) Base Franklin Bluffs Member (Middle Sagavanirktok) 1183 1850 1379 10545 10664 7258 7258 3 10802 10555 10697 10210 33 10358 10477 N/A N/A 10510 10477 3079716 12 .25" 10555 10674 10674 10707 119 Report number 22 Job No.:AK-AM-0009498071 Density: 9.75 Daily time-slot 00:00-06:00 06:00-12:00 12:00-13:00 13:00-14:30 14:30-15:00 15:00-18:00 18:00-21:30 21:30-23:00 23:00-24:00 Comments Interval (ft) Max Min Interval (ft) BHA Run #Bit Type Size TFA Hours Footage WOB RPM Condition #2/ Run 200 16"0.6995 #3/ Run 300 12.25 0.8629 ROP Current Avg 24 hr Max Max @ Ft R.O.P. (ft/hr)N/A N/A Depth Ann Corr Drilling Min N/A Avg N/A Max 8750 95.6 30bbls All Circ Min N/A Avg N/A Max 10477 3079716 12 .25" 10555 10674 10674 10707 119 33 10358 10477 N/A N/A 10510 10545 10664 7258 7258 3 10802 10555 10697 10210 10220 335 10664 10023 Formation Tops in Red Surface Tops in Blue Undetermined Tops in Black Top Franklin Bluffs Member (Middle Sagavanirktok) Base Franklin Bluffs Member (Middle Sagavanirktok) 1183 1850 1379 Ground Level = 558.162 m, RKB = 567.162 m. Origin Measurement Depths (MD) per foot from RKB. Campanian Flooding Surface Middle Sagavanirktok Depth (SSTVD) 2046 Gas Shows and chromatographic analysis 86 133 808 691 761 2046 2046 7392 7392 Latitude: 69° 58' 7.368 N 12 13 Formation Tops From Wellsite Geologist 373 Permafrost Formation Tops/ Markers 7065 7261 520 131 1166 1788 C3 (ppm) 7261 8999 9218 51 1193 Total Gas (units) Summary lithological description and remarks C2 (ppm) Lower Canning 406 9210 8480 10812 667 0 484 372 484 207 1355 761 RIG: Nabors 105 Bit#3, life/footage:95.6hrs/6288'ROP (min-max): N/A Flow (gpm): N/A Stand pipe pressure (psi): N/A Daily Progress: 0' Longitude: 148° 42' 48.292 W Previous depth: 8750' DAILY GEOLOGICAL AND OPERATIONS REPORT All measurement depths (MD) are quoted per foot from rotary kelly bushing (RKB) Coordinates: WELL : Merak 1 Ground Level: 174.7' Report date: 9/10/2012 Today's date: 9/11/2012 Kelly Bushing level (KB): 196.40' Average ROP: N/A WOB (k): N/A RPM (Rot/min): N/A Water (% by volume):90% Total depth @ 24h00: 8750' Geologist: Paul StilesDays since spud: 19 691 761 Next 24 Hours Forecast (00h00 to 24h00) Lost 280 bbls down hole while chasing plug with rig pumps. Spud date: 8/22/2012 Representative: Mike Grubb, Jay Murphy Last Survey: 8687.33'/8682.14'/8.06°/330.88° 9077 6450 Depth (TVD) Current Operations Status (00h00 to 04h00) Bit #3 12.25" HBDS FX56M Dropped opening plug & let it seat. Pressure up to 540 psi to open ES cementer, circulated @ 5bpm, no cmnt to surface, test lines, start stage 2 cmnt job Casing shoe: 13 3/8" @ 2441 ft. Casing shoe: size @ xxxft. 2566 9294 9540 3732 5520 5892 9218 9085 9085 8480 6450 484 9913 9210 9903 9222 9235 9285 9531 9230 80 Test cement lines to 4500psi Dropped wiper plug, pumped 1st stage cement: 369 bbls 12.5lb lead/ 78bbls 15.8lb tail, Max gas: 614 units Mud type: LSND Mud Drain stack, verified land, rigged down casing equip, stabbing board and Franks tool 5520 5892 1379 Zone Thickness Finish stage 2 cement job, R/D cementers, clean and clear pits, continue hooking up MPD equipment, 558 2046 2566 3732 9344 8477 8477 8992 90778890 9023 9048 9098 246 9243 8805 8890 Lower Sagavanirktok Staines Tongue (Lower Sagavanirktok) 9023 9035 2370 8280 8280 7196 Middle Schrader Bluff 7062 1850 3536 5324 5696 6254 C1 (ppm) Prince Creek Upper Schrader Bluff Lower Canning MCU (Mid Campanian Unconformity) Hue Shale LCU (Lower Cretaceous Unconformity) iC5 & nC5 (ppm) Flow In (spm) N/A Gallons/stroke 3.173 iC4 & nC4 (ppm) Casing and Liner Ran casing f/3078'-6021, filling every joint, break circ. Every 35 jts, no issues running casing Run casing f/6021'-8408' filling every joint, break circ every 35 jts, no issues or hole problems Summary Operations Depth KB (MD) -196 0Holocene Run casing f/8408'-8699', break circ @ 8532' M/U landing jt, land @ 8726.66' Circulate and condition due to lost circ pumped at 3-5.5 BPM, Bttms Up returns clean, 10392 strokes total, held pre-job with cement crew Installed cement lines, made up cross over and cement head, rigged up to circulate 288 495 565 Hole Condition On Bot Hrs Avg Diam PWD Kuparauk A Miluveach Upper Kingak Formation Gublik Top HRZ (Higly Radioactive Zone) Base HRZ Pebble Shale Kuparauk B Mikkelson Tongue (Upper Canning) Kuparauk C Lower Kingak TD Depth (ft)Gas type & remarks Bttms Up, While pumping w/ Cement pumps. 614 Direct fluorescence comment Cut fluorescence comment EBXT1GRC FX56M 31.7 95.6 Depth In Depth Out 2462 8750 707 2462 Shows Fluorescence 70.000 61.000 6-5-WT-A-E-1-ER-TD 1-2-CT-A-X-I-BT-TD Current Pump & Flow Data 1755 6288 N/A N/A Flow In (gpm) N/A SPP (psi) N/A 10 8 Lower Kingak (K-1 Top) Lower Kingak Base Top Shublik Ivishak Base Shublik Fire Creek 10615 10358 10545 Dropped plug @ 21:20, flushed 10bbls, chased with rig pumps @ 10bpm, 3 bpm through packer stopped @ 8364 stks, lost 280bbls LSND No sign of plug laning at landing collar, Bleed off and check float wait on orders Daily Charges: Total Charges: Chlorides (mg/l): 9000 Total Hardness (mg/l): Report number 23 Job No.:AK-AM-0009498071 Density: 9.75 Daily time-slot 00:00-01:30 01:30-03:00 03:00-05:30 05:30-08:00 08:00-09:00 09:00-10:30 10:30-12:00 12:00-14:00 14:00-16:00 16:00-17:00 17:00-18:30 18:30-20:30 20:30-24:00 Comments Interval (ft) Max Min Interval (ft) BHA Run #Bit Type Size TFA Hours Footage WOB RPM Condition #2/ Run 200 16"0.6995 #3/ Run 300 12.25 0.8629 ROP Current Avg 24 hr Max Max @ Ft R.O.P. (ft/hr)N/A N/A Depth Ann Corr Drilling Min N/A Avg N/A Max 8750 95.6 30bbls All Circ Min N/A Avg N/A Max Daily Charges: Total Charges: Chlorides (mg/l): 8500 100 10615 10358 10545 Remove new well head f/ crate, prep adapter flange Install new wellhead and test void to 5000 psi f/ 10 mins, Tighten gland nuts, remove flow nipple f/annulus clean holes and install studs for R.C.D Continue to remove koomey, choke and kill lines, pull out mouse hole, remove annualr from cellar Nipple down and remove double gates, nipple down and remove lower pipe rams w/ mud cross Lower Kingak (K-1 Top) Lower Kingak Base Top Shublik Ivishak Base Shublik Fire Creek N/A SPP (psi) N/A 10 8 Current Pump & Flow Data 1755 6288 N/A N/A Flow In (gpm) 2462 8750 707 2462 Shows Fluorescence 70.000 61.000 6-5-WT-A-E-1-ER-TD 1-2-CT-A-X-I-BT-TD EBXT1GRC FX56M 31.7 95.6 Depth In Depth Out Direct fluorescence comment Cut fluorescence comment Gublik Top HRZ (Higly Radioactive Zone) Base HRZ Pebble Shale Kuparauk B Mikkelson Tongue (Upper Canning) Kuparauk C Hole Condition On Bot Hrs Avg Diam PWD Kuparauk A Miluveach Upper Kingak Formation Pump 8bbls water and 30bbls spacer, pump 160bbls 15.8lbs cmnt, no returns @ 150bbls pumped, drop plug and displaced w/ 165.5 bbls, bumped plug @ 2221 stks, No returns Install 9 5/8" pack-off, R.I.L.D.S, and test void to 5000psi for 10 mins Gravity feed 3.5bbls diesel freeze protect down 9 5/8" annulus 288 495 565 3.173 iC4 & nC4 (ppm) Casing and Liner Dropped plug and allowed plug to seat. Pumped up to 540 psi to open ES cementer Circulate at 5 BPM, No cement to surface Summary Operations Depth KB (MD) Lower Canning MCU (Mid Campanian Unconformity) Hue Shale LCU (Lower Cretaceous Unconformity) iC5 & nC5 (ppm) Flow In (spm) N/A Gallons/stroke Lower Kingak TD 7196 Middle Schrader Bluff 7062 1850 3536 5324 5696 6254 Prince Creek Upper Schrader Bluff 246 9243 8805 8890 Lower Sagavanirktok Staines Tongue (Lower Sagavanirktok) 9023 9035 2370 8280 C1 (ppm)Depth (ft)Gas type & remarks 9344 8477 8477 8992 90778890 9023 9048 9098 8280 1379 Zone Thickness Rig up MPD equipment and rig up solids control equipment 558 2046 2566 3732 -196 0Holocene 9913 9210 9903 9222 9235 9285 9531 9230 9294 9540 3732 5520 5892 9218 9085 9085 8480 9077 6450 Depth (TVD) Current Operations Status (00h00 to 04h00) Bit #3 12.25" HBDS FX56M Continue to nipple up BOPs install MPD equipment Casing shoe: 13 3/8" @ 2441 ft. Casing shoe: 9 5/8" @ 8726.6 ft. 2566 6450 484 Next 24 Hours Forecast (00h00 to 24h00) Lost 165 bbls of mud downhole while chasing plug on second cement job. Remove adapter flange, suck out 9 5/8" and cellar with super sucker Spud date: 8/22/2012 Representative: Mike Grubb, Jay Murphy Last Survey: 8687.33'/8682.14'/8.06°/330.88° 80 Clean out drop pan, pull flow nipple, bleed koomey, remove hoses, break stud on annular, remove turnbuckles Mud type: LSND Mud Average ROP: N/A WOB (k): N/A RPM (Rot/min): N/A Nipple up 10K to 5K adapter flange, lower pipe rams and mud cross Water (% by volume):90% Total depth @ 24h00: 8750' Blow down cmnt lines, R/D cmnt head, landing jt, long bails, spiders and elevators. R/U short bails and 5" elevators DAILY GEOLOGICAL AND OPERATIONS REPORT All measurement depths (MD) are quoted per foot from rotary kelly bushing (RKB) Coordinates: WELL : Merak 1 Ground Level: 174.7' Report date: 9/11/2012 Today's date: 9/12/2012 Kelly Bushing level (KB): 196.40' RIG: Nabors 105 Bit#3, life/footage:95.6hrs/6288'ROP (min-max): N/A Flow (gpm): N/A Stand pipe pressure (psi): N/A Daily Progress: 0' Longitude: 148° 42' 48.292 W Previous depth: 8750' Geologist: Paul StilesDays since spud: 19 10812 667 0 484 372 484 207 1355 761 1193 Total Gas (units) Summary lithological description and remarks C2 (ppm) Lower Canning 406 9210 8480 520 131 1166 1788 C3 (ppm) 7261 8999 9218 51 Latitude: 69° 58' 7.368 N 12 13 Formation Tops From Wellsite Geologist 373 Permafrost Formation Tops/ Markers 7065 7261 691 761 2046 2046 7392 7392 691 761 5520 5892 Ground Level = 558.162 m, RKB = 567.162 m. Origin Measurement Depths (MD) per foot from RKB. Campanian Flooding Surface Middle Sagavanirktok Depth (SSTVD) 2046 Gas Shows and chromatographic analysis 86 133 808 10220 335 10664 10023 Formation Tops in Red Surface Tops in Blue Undetermined Tops in Black Top Franklin Bluffs Member (Middle Sagavanirktok) Base Franklin Bluffs Member (Middle Sagavanirktok) 1183 1850 1379 10545 10664 7258 7258 3 10802 10555 10697 10210 33 10358 10477 N/A N/A 10510 10477 3079716 12 .25" 10555 10674 10674 10707 119 Report number 24 Job No.:AK-AM-0009498071 Density: 9.75 Daily time-slot 00:00-06:00 06:00-09:00 09:00-11:00 11:00-12:00 12:00-14:00 14:00-16:00 16:00-18:00 18:00-19:30 19:30-22:30 22:30-23:30 23:30-24:00 Comments Interval (ft) Max Min Interval (ft) BHA Run #Bit Type Size TFA Hours Footage WOB RPM Condition #2/ Run 200 16"0.6995 #3/ Run 300 12.25 0.8629 ROP Current Avg 24 hr Max Max @ Ft R.O.P. (ft/hr)N/A N/A Depth Ann Corr Drilling Min N/A Avg N/A Max 8750 95.6 30bbls All Circ Min N/A Avg N/A Max 10477 3079716 12 .25" 10555 10674 10674 10707 119 33 10358 10477 N/A N/A 10510 10545 10664 7258 7258 3 10802 10555 10697 10210 Formation Tops in Red Surface Tops in Blue Undetermined Tops in Black Top Franklin Bluffs Member (Middle Sagavanirktok) Base Franklin Bluffs Member (Middle Sagavanirktok) 1183 1850 1379 Ground Level = 558.162 m, RKB = 567.162 m. Origin Measurement Depths (MD) per foot from RKB. Campanian Flooding Surface Middle Sagavanirktok Depth (SSTVD) 2046 Gas Shows and chromatographic analysis 86 133 808 691 761 2046 2046 7392 7392 691 761 5520 5892 Latitude: 69° 58' 7.368 N 12 13 Formation Tops From Wellsite Geologist 373 Permafrost Formation Tops/ Markers 7065 7261 131 1166 1788 C3 (ppm) 7261 8999 9218 51 10220 1193 Total Gas (units) Summary lithological description and remarks C2 (ppm) Lower Canning 406 9210 8480 667 0 484 372 484 207 1355 761 520 RIG: Nabors 105 Bit#3, life/footage:95.6hrs/6288'ROP (min-max): N/A Flow (gpm): N/A Stand pipe pressure (psi): N/A Daily Progress: 0' Longitude: 148° 42' 48.292 W Previous depth: 8750' Geologist: Paul StilesDays since spud: 20 DAILY GEOLOGICAL AND OPERATIONS REPORT All measurement depths (MD) are quoted per foot from rotary kelly bushing (RKB) Coordinates: WELL : Merak 1 Ground Level: 174.7' Report date: 9/12/2012 Today's date: 9/13/2012 Kelly Bushing level (KB): 196.40' WOB (k): N/A RPM (Rot/min): N/A Water (% by volume):90% Total depth @ 24h00: 8750' Install valve on rotating head tee, Secure stack. Clean up cellar, clean pits hang MPD valve below tee Install 9 1/16" ID wear bushing, R/U annulus to drain stack Spud date: 8/22/2012 Representative: Mike Grubb, Jay Murphy Last Survey: 8687.33'/8682.14'/8.06°/330.88° 100 Function test BOPs, bring Koomey online, check for leaks, function test all rams and HCR's, Install mousehole, continued rigging up PCD equipment Mud type: LSND Mud Average ROP: N/A 6450 Depth (TVD) Current Operations Status (00h00 to 04h00) Bit #3 12.25" HBDS FX56M RIH w/ 63 jts of DP. Rack back DP. Casing shoe: 13 3/8" @ 2441 ft. Casing shoe: 9 5/8" @ 8726.6 ft. 2566 6450 484 Next 24 Hours Forecast (00h00 to 24h00) 9230 9294 9540 3732 5520 5892 9218 9085 9085 8480 -196 0Holocene 9913 9210 9903 9222 9235 9285 9531 9048 9098 8280 1379 Zone Thickness Continue to hook up MPD equipment 558 2046 2566 3732 8477 8477 8992 90778890 9023 9077 C1 (ppm)Depth (ft)Gas type & remarks 9344 10812 335 10664 10023 246 9243 8805 8890 Lower Sagavanirktok Staines Tongue (Lower Sagavanirktok) 9023 9035 2370 8280 7196 Middle Schrader Bluff 7062 1850 3536 5324 5696 6254 Prince Creek Upper Schrader Bluff LCU (Lower Cretaceous Unconformity) iC5 & nC5 (ppm) Flow In (spm) N/A Gallons/stroke Lower Kingak TD 3.173 iC4 & nC4 (ppm) Casing and Liner Attach choke nad kill lines., set double gate set rotating head on annular, set annular on double gate Torque BOP flanges, change top and bottom rams to 2 7/8" X 5 1/2, install tee on rotating head Summary Operations Depth KB (MD) Change rotating head/ rubber, reorient roatating head and reinstall tee Install Koomey lines on BOPs, continue rigging up PCD equipment, remove uneaded equipment from landing, instal die screws on ST-80 dies, Install #2 mix pump Continue to rig up PCD equipment, celam ram inserts and remove from cellar, clean cellar and clear tools/equipment 288 495 565 Hole Condition On Bot Hrs Avg Diam PWD Kuparauk A Miluveach Upper Kingak Formation Gublik Top HRZ (Higly Radioactive Zone) Base HRZ Pebble Shale Kuparauk B Mikkelson Tongue (Upper Canning) Kuparauk C Lower Canning MCU (Mid Campanian Unconformity) Hue Shale Direct fluorescence comment Cut fluorescence comment FX56M 31.7 95.6 Depth In Depth Out 2462 8750 707 2462 Shows Fluorescence 70.000 61.000 6-5-WT-A-E-1-ER-TD 1-2-CT-A-X-I-BT-TD EBXT1GRC 1755 6288 N/A N/A Flow In (gpm) Ivishak Base Shublik Fire Creek N/A SPP (psi) N/A 10 8 Current Pump & Flow Data 10615 10358 10545 Pick up drill pipe from pipe shed. Secure stack, load out truck, M/U safety valves to be tested Test BOPs: M/U test joint and plug, preformed body test to 250/3500psi. Load pipe shed with 63 joints of drill pipe and strap same. R/D testing equipment and rig up GeoSpan Lower Kingak (K-1 Top) Lower Kingak Base Top Shublik Daily Charges: Total Charges: Chlorides (mg/l): 8500 Hardness (mg/l): Report number 25 Job No.:AK-AM-0009498071 Density: 9.8 Daily time-slot 00:00-03:00 03:00-05:00 05:00-05:30 05:30-07:30 07:30-12:00 12:00-12:30 12:30-15:00 15:00-17:00 17:00-19:00 19:00-20:30 20:30-24:00 Comments Interval (ft) Max Min Interval (ft) BHA Run #Bit Type Size TFA Hours Footage WOB RPM Condition ROP Current Avg 24 hr Max Max @ Ft R.O.P. (ft/hr)N/A N/A Depth Ann Corr Drilling Min N/A Avg N/A Max All Circ Min N/A Avg N/A Max Total Charges: Chlorides (mg/l): 8500 Hardness (mg/l): 10615 10358 10545 Tagged up at 2377', washed and rotated down to 2397', drill plug to 2403' Install flow riser, adjust stack for hammer seal, continue work on flowline P/U and M/U BHA #5, dumb iron, t/646', L/D single of HWDP Lower Kingak (K-1 Top) Lower Kingak Base Top Shublik Ivishak Base Shublik Fire Creek N/A SPP (psi) N/A Current Pump & Flow Data N/A N/A Flow In (gpm) Shows Fluorescence Depth In Depth Out Direct fluorescence comment Cut fluorescence comment Kuparauk B Mikkelson Tongue (Upper Canning) Kuparauk C Lower Canning MCU (Mid Campanian Unconformity) Hue Shale Hole Condition On Bot Hrs Avg Diam PWD Kuparauk A Miluveach Upper Kingak Formation Service Topdrive grease blocks and wash pipe. Check cellar and BOP valves Waiting on tools, waiting on flow nipple f/ GBR welding, replaced lights in derrick, cleaned rig floor and stack, blew down mud lines, hooked up hole fill line 288 495 565 Casing and Liner Pick up 63 JTS 5" DP Trip out of the hole and rack back 21 stands of 5" DP. Summary Operations Depth KB (MD) Gublik Top HRZ (Higly Radioactive Zone) Flow In (spm) N/A Gallons/stroke Lower Kingak TD 3.173 iC4 & nC4 (ppm) 7196 Middle Schrader Bluff 7062 1850 3536 5324 5696 6254 Prince Creek Upper Schrader Bluff 246 9243 8805 8890 Lower Sagavanirktok Staines Tongue (Lower Sagavanirktok) 9023 9035 2370 8280 Depth (ft)Gas type & remarks 9344 10812 335 10664 10023 iC5 & nC5 (ppm) 8992 90778890 9023 9077 C1 (ppm) LCU (Lower Cretaceous Unconformity) Base HRZ Pebble Shale 8280 1379 Zone Thickness Trip out of hole, L/D BHA, Test BOPs, P/U directional and MWD tools/BHA. 558 2046 2566 3732 8477 8477 Holocene 9913 9210 9903 9222 9235 9285 9531 9048 9098 9230 9294 9540 3732 5520 5892 9218 9085 9085 8480 Depth (TVD) Current Operations Status (00h00 to 04h00) Bit #4 8.5" HBDS FX56 drilled out plug to 2427'. Tested casing to 3000psi for 30 minutes, Tripped out to 1975' as of 04:00 Casing shoe: 13 3/8" @ 2441 ft. Casing shoe: 9 5/8" @ 8726.6 ft. 2566 484 Next 24 Hours Forecast (00h00 to 24h00) -196 0 Trip in hole f/646' to 2362' filled pipe at 1500' Spud date: 8/22/2012 Representative: Mike Grubb, Jay Murphy Last Survey: 8687.33'/8682.14'/8.06°/330.88° 100 BOP riser being built by GBR, continue modifications to flowline, strap and measure BHA, bring XO's and bit to rig floor Mud type: LSND Mud Average ROP: N/A WOB (k): N/A RPM (Rot/min): N/A Water (% by volume):90% Total depth @ 24h00: 8750' Test BOPs RU and test upper and lower 2 7/8" x 5 1/2" VBRs, 250/3500 psi Daily Charges: DAILY GEOLOGICAL AND OPERATIONS REPORT All measurement depths (MD) are quoted per foot from rotary kelly bushing (RKB) Coordinates: WELL : Merak 1 Ground Level: 174.7' Report date: 9/13/2012 Today's date: 9/14/2012 Kelly Bushing level (KB): 196.40' RIG: Nabors 105 Bit#4, life/footage:ROP (min-max): N/A Flow (gpm): N/A Stand pipe pressure (psi): N/A Daily Progress: 0' Longitude: 148° 42' 48.292 W Previous depth: 8750' Geologist: Paul StilesDays since spud: 21 0 484 372 484 207 1355 761 520 1193 Total Gas (units) Summary lithological description and remarks C2 (ppm) Lower Canning 406 9210 8480 131 1166 1788 C3 (ppm) 7261 8999 9218 51 10220 Latitude: 69° 58' 7.368 N 12 13 Formation Tops From Wellsite Geologist 373 Permafrost Formation Tops/ Markers 7065 7261 2046 2046 7392 7392 691 761 5520 5892 64506450 Campanian Flooding Surface Middle Sagavanirktok Depth (SSTVD) 2046 Gas Shows and chromatographic analysis 86 133 808 691 Formation Tops in Red Surface Tops in Blue Undetermined Tops in Black Top Franklin Bluffs Member (Middle Sagavanirktok) Base Franklin Bluffs Member (Middle Sagavanirktok) 1183 1850 1379 Ground Level = 558.162 m, RKB = 567.162 m. Origin Measurement Depths (MD) per foot from RKB. 761 667 10545 10664 7258 7258 3 10802 10555 10697 10210 33 10358 10477 N/A N/A 10510 10477 3079716 10555 10674 10674 10707 119 Report number 26 Job No.:AK-AM-0009498071 Density: 9.8 Daily time-slot 00:00-00:30 00:30-01:00 01:00-02:00 02:00-03:00 03:00-05:00 05:00-06:00 06:00-06:30 06:30-11:30 11:30-12:00 12:00-13:00 13:00-17:00 17:00-23:30 23:30-24:00 Comments Interval (ft) Max Min Interval (ft) BHA Run #Bit Type Size TFA Hours Footage WOB RPM Condition BHA #6 Bit #4RR1 8.5 0.8629 ROP Current Avg 24 hr Max Max @ Ft R.O.P. (ft/hr)N/A N/A Depth Ann Corr Drilling Min N/A Avg N/A Max All Circ Min N/A Avg N/A Max 10477 3079716 10555 10674 10674 10707 119 33 10358 10477 N/A N/A 10510 10545 10664 7258 7258 3 10802 10555 10697 10210 Base Franklin Bluffs Member (Middle Sagavanirktok) 1183 1850 1379 Ground Level = 558.162 m, RKB = 567.162 m. Origin Measurement Depths (MD) per foot from RKB. 761 667 Middle Sagavanirktok Depth (SSTVD) 2046 Gas Shows and chromatographic analysis 86 133 808 691 Top Franklin Bluffs Member (Middle Sagavanirktok) 2046 2046 7392 7392 691 761 5520 5892 64506450 Latitude: 69° 58' 7.368 N 12 13 Formation Tops From Wellsite Geologist 373 Permafrost Formation Tops/ Markers 7065 7261 131 1166 1788 C3 (ppm) 7261 8999 9218 51 10220 1193 Total Gas (units) Summary lithological description and remarks C2 (ppm) Lower Canning 406 9210 8480 372 484 207 1355 761 520 RIG: Nabors 105 Bit#4, life/footage:ROP (min-max): N/A Flow (gpm): N/A Stand pipe pressure (psi): N/A Daily Progress: 0' Longitude: 148° 42' 48.292 W Previous depth: 8750' Geologist: Paul StilesDays since spud: 22 DAILY GEOLOGICAL AND OPERATIONS REPORT All measurement depths (MD) are quoted per foot from rotary kelly bushing (RKB) Coordinates: WELL : Merak 1 Ground Level: 174.7' Report date: 9/14/2012 Today's date: 9/15/2012 Kelly Bushing level (KB): 196.40' Circulate and condition , washed down f/8590. Tagged up at 8590' Water (% by volume):90% Total depth @ 24h00: 8750' Test casing to 3000psi, chart and held for 30 minutes, R/D teesting equipment, blow down surface lines Daily Charges: Spud date: 8/22/2012 Representative: Mike Grubb, Craig Ruminer Last Survey: 8687.33'/8682.14'/8.06°/330.88° 140 P/U testing tools, pull wear ring, R/U test JT Mud type: LSND Mud Average ROP: N/A WOB (k): N/A RPM (Rot/min): N/A Bit #4RR1 8.5" HBDS FX56 Drilled out fill/plug/cement f/8590' to 8750'. Drilled 20' new formation to 8770', Max 854 units of gas at bottom of shoe Casing shoe: 13 3/8" @ 2441 ft. Casing shoe: 9 5/8" @ 8726.6 ft. 2566 484 Next 24 Hours Forecast (00h00 to 24h00) -196 0 No Downhole mud losses Blow down choke and kill lines, line up choke manifold and BOP valves 9230 9294 9540 3732 5520 5892 9218 9085 9085 84808477 Holocene 9913 9210 9903 9222 9235 9285 9531 9048 1379 Zone Thickness Switch mud to 10.8ppg, perform LOT Drill ahead to first core point projected @ +/- 9030Circulate and condition, POOH f/ core assembly 558 2046 2566 3732 Depth (TVD) 0 484 C1 (ppm) LCU (Lower Cretaceous Unconformity) Base HRZ Pebble Shale 8280 9098 Depth (ft)Gas type & remarks 9344 10812 335 10664 10023 iC5 & nC5 (ppm) While RIH Lower Sagavanirktok Staines Tongue (Lower Sagavanirktok) 9023 9035 2370 8280 8890 9023 Campanian Flooding Surface Prince Creek Upper Schrader Bluff 246 9243 8805 8890 8992 9077 9077 8477 7062 1850 3536 5324 5696 6254 Flow In (spm) N/A Gallons/stroke Lower Kingak TD 3.173 iC4 & nC4 (ppm) Casing and Liner Drill through free fall opening cone @ 2397' Wash down t/2412', tagged obstruction, rotated through, Torqued up, plled 20K over to free, continued to 2427' Summary Operations Depth KB (MD) Gublik Current Operations Status (00h00 to 04h00) Formation Tops in Red Surface Tops in Blue Undetermined Tops in Black Pumped to 2950psi to open valve and inflate packer, loss of psi to 2370', bleed to 800psi, pumped to 2250psi to shut valve, confirmed packer shut Set back HWDP and flex collars, break bit and bit sub, Clear floor Trip out of the hole f/2427 to surface 288 495 565 PWD Kuparauk A Miluveach Upper Kingak Formation Kuparauk C Lower Canning MCU (Mid Campanian Unconformity) Hue Shale Hole Condition On Bot Hrs Avg Diam Top HRZ (Higly Radioactive Zone) 7196 Middle Schrader Bluff 31 0 Direct fluorescence comment Cut fluorescence comment Depth In Depth Out 8570HDBS FX56 N/A N/A Flow In (gpm) Shows Fluorescence N/A SPP (psi) N/A Current Pump & Flow Data Test BOPs 250low/5000 high, Test annular to 2500, perform accumulator test, Test witnessed bu AOGCCD. Rigged down test equip and installed wear ring L/D testing tools and test joint, set wear ring Lower Kingak (K-1 Top) Lower Kingak Base Top Shublik Ivishak Base Shublik Fire Creek Kuparauk B Mikkelson Tongue (Upper Canning) Total Charges: Chlorides (mg/l): 8000 Hardness (mg/l): 10615 10358 10545 P/U BHA #6, surface test tools, Shallow pulse tested tools @ 691' Trip into the hole f/691' to 2312, slide through packer @ 2312', tagged plug at 2505'RIH cahsing plug f/2505' to 8415', filling pipe every 2500'. Report number 27 Job No.:AK-AM-0009498071 Density: 10.6 Daily time-slot 00:00-03:30 03:30-04:30 04:30-08:00 08:00-10:00 10:00-12:00 12:00-18:00 18:00-19:30 19:30-21:00 21:00-22:00 22:00-24:00 Comments Interval (ft) 8750'-8948' MD 8948-Current MD Max Min Interval (ft) BHA Run #Bit Type Size TFA Hours Footage WOB RPM Condition BHA #6 Bit #4RR1 8.5 0.8629 ROP Current Avg 24 hr Max Max @ Ft R.O.P. (ft/hr)N/A 50 Depth Ann Corr Drilling Min 10.92 Avg N/A 11.19 9012 6.3 0 All Circ Min 10.06 Avg N/A 10.71 10477 3079716 8.5" 10555 10674 10674 10707 119 33 10358 10477 10.06 9.97 10510 10545 10664 7258 7258 3 10802 10555 10697 10210 Base Franklin Bluffs Member (Middle Sagavanirktok) 1183 1850 1379 Ground Level = 558.162 m, RKB = 567.162 m. Origin Measurement Depths (MD) per foot from RKB. 761 667 Middle Sagavanirktok Depth (SSTVD) 2046 Gas Shows and chromatographic analysis 86 133 808 691 Top Franklin Bluffs Member (Middle Sagavanirktok) 2046 2046 7392 7392 691 761 5520 5892 64506450 Latitude: 69° 58' 7.368 N 12 13 Formation Tops From Wellsite Geologist 373 Permafrost Formation Tops/ Markers 7065 7261 131 1166 1788 C3 (ppm) 7261 8955 9218 51 10220 1193 Total Gas (units) Summary lithological description and remarks C2 (ppm) HRZ Dark gray-brownish balck, mod hard-hard shale, well laminated, trace interbed tuffs. Lower Canning 555 9210 8480 372 484 207 1355 761 520 RIG: Nabors 105 Bit#4, life/footage: 6.3hrs/262'ROP (min-max): 5-73ft/hr Flow (gpm): 430 Stand pipe pressure (psi): 1620 Daily Progress: 262' Longitude: 148° 42' 48.292 W Previous depth: 8750' Geologist: Paul StilesDays since spud: 23 DAILY GEOLOGICAL AND OPERATIONS REPORT All measurement depths (MD) are quoted per foot from rotary kelly bushing (RKB) Coordinates: WELL : Merak 1 Ground Level: 174.7' Report date: 9/15/2012 Today's date: 9/16/2012 Kelly Bushing level (KB): 196.40' Water (% by volume):88% Total depth @ 24h00: 9012' Rigged up for LOT, filled all surface lines, performed LOT w/10.4ppg mud @ 8721' TVD to 14.7ppg equivalent, rigged down test equip, blow down surface lines Daily Charges: Spud date: 8/22/2012 Representative: Mike Grubb, Craig Ruminer Last Survey: 8687.33'/8682.14'/8.06°/330.88° 120 Circulate and condition, continued to weight up to 10.6ppg, pumps off gas 1755units Mud type: LSND Mud Average ROP: 50 ft/hr WOB (k): 2-9k RPM (Rot/min): 80-120 Bit #4RR1 8.5" HBDS FX56 Continued tripping out of the hole. Started laying down tools Casing shoe: 13 3/8" @ 2441 ft. Casing shoe: 9 5/8" @ 8726.6 ft. 2566 484 Next 24 Hours Forecast (00h00 to 24h00) -196 0 No Downhole mud losses Tripped out of hole f/8702 -5920' 9230 9294 9540 3732 5520 5892 9218 9085 9085 84808477 Holocene 9913 9210 9903 9222 9235 9285 9531 9048 1379 Zone Thickness Lay down BHA, M/U coring BHA w/ 90' core bbl, RIH to shoe, slip and cut drill line, RIH to bottom, Core ahead 90', POOH w/ core 558 2046 2566 3732 Depth (TVD) 0 484 130305 C1 (ppm) LCU (Lower Cretaceous Unconformity) Base HRZ Pebble Shale 8280 9098 Depth (ft)Gas type & remarks 9344 10812 335 10664 10023 iC5 & nC5 (ppm) CG f/ 8991' conn. Lower Sagavanirktok Staines Tongue (Lower Sagavanirktok) 9023 9035 2370 8280 8890 9023 Campanian Flooding Surface Prince Creek Upper Schrader Bluff 246 9243 8751 8890 8948 9077 9077 8477 7062 1850 3536 5324 5696 6254 Flow In (spm) N/A Gallons/stroke Lower Kingak TD trace-spotty dull yellow-yellow white sample fluor trace-spotty yellow sample fluor Brownish Black, mod hard, well laminated, shale w/com micas, organic material, and occasional tuff interbeds 3.173 iC4 & nC4 (ppm) Casing and Liner Drilled out collar, shoe and 20' of new formation f/8590' to 8770' Circulated and conditioned mud @ 8770' Summary Operations Depth KB (MD) Gublik Current Operations Status (00h00 to 04h00) Formation Tops in Red Surface Tops in Blue Undetermined Tops in Black Displaced well f/ 9.8ppg mud to 10.4 ppg mud Drilled ahead f/8801'-9012' into top of HRZ (core point) gas 400-800 units while drilling, connection gas 1075units, weighted up mud to 10.4 heavy Washed fill f/8764' to 8770', Drilled ahead f/8770' to 8801'. 288 495 565 PWD Kuparauk A Miluveach Upper Kingak Hue Shale Formation 0 Hue Shale HRZ Kuparauk C Lower Canning MCU (Mid Campanian Unconformity) Hue Shale Hole Condition On Bot Hrs Avg Diam Top HRZ (Higly Radioactive Zone) 7196 Middle Schrader Bluff 1755 0 Direct fluorescence comment Cut fluorescence comment 9124 0 6210 293/539422/2186 Depth In Depth Out 00 8570HDBS FX56 6.3 73 8863' diffuse yellow-yellow white cut fluor, nil streamers weak yellow-white to white, rare white-blue cut fluor, rare streamers Flow In (gpm) 0 9012 Shows Fluorescence 120 max N/A SPP (psi) N/A 9k max Current Pump & Flow Data 0 442 Circulated and conditioned, monitored well, circulated bottoms up, gas decrease to 140-200units, built dry job Tripped out of hole into shoe to 8702', pumped dry job Lower Kingak (K-1 Top) Lower Kingak Base Top Shublik Ivishak Base Shublik Fire Creek Kuparauk B Mikkelson Tongue (Upper Canning) Total Charges: Chlorides (mg/l): 14500 Hardness (mg/l): 10615 10358 10545 Report number 28 Job No.:AK-AM-0009498071 Density: 10.6 Daily time-slot 00:00-04:00 04:00-06:00 06:00-10:00 10:00-11:00 11:00-12:00 12:00-19:00 19:00-21:30 21:30-23:30 23:30-24:00 Comments Interval (ft) 8948'-Current Max Min Interval (ft) BHA Run #Bit Type Size TFA Hours Footage WOB RPM Condition BHA #6 Bit #4RR1 8.5 0.8629 BHA #7 Bit #5 8.5 1.3 ROP Current Avg 24 hr Max Max @ Ft R.O.P. (ft/hr)2.8 3.3 Depth Ann Corr Drilling Min N/A Avg N/A Max 9022 4.1 0 All Circ Min N/A Avg N/A Max Safety stand down due to falling object f/Derrick, Stopped job, investigated cause and midigated hazards removed unecessary segments of lines. Tripped in hole f/99'-1507' Slipped and cut 82.5' of drilling line, Serviced topdrive, block, and crown. Circulate. Total Charges: Chlorides (mg/l): 15000 Hardness (mg/l): 10615 10358 10545 Dropped flow diversion ball, M/U Std 89, let ball seat. Circulate @ 250 gpm Lower Kingak (K-1 Top) Lower Kingak Base Top Shublik Ivishak Base Shublik Fire Creek Kuparauk B Mikkelson Tongue (Upper Canning) 245 SPP (psi) 805 9k max Current Pump & Flow Data 0 442 5.09 9015' diffuse yellow-yellow white cut fluor, nil streamers Flow In (gpm) 0 9012 Shows Fluorescence 120 maxHDBS FX56 FC3747 6.3 Depth Out 00 8570 1092 0 Direct fluorescence comment Cut fluorescence comment 5610 0 4191 164/237258/1322 Lower Canning MCU (Mid Campanian Unconformity) Hue Shale Hole Condition On Bot Hrs Avg Diam Top HRZ (Higly Radioactive Zone) 7196 Middle Schrader Bluff Depth In Formation 0 HRZ HRZ Kuparauk C Tripped in hole f/1507'-8662', filling pipe every 2000' 288 495 565 PWD Kuparauk A Miluveach Upper Kingak Summary Operations Depth KB (MD) Gublik Current Operations Status (00h00 to 04h00) Formation Tops in Red Surface Tops in Blue Undetermined Tops in Black Pick up coring BHA t/99' Flow In (spm) 78 Gallons/stroke Lower Kingak TD trace-spotty yellow sample fluor Dark gray-brownish balck, mod hard-hard shale, well laminated, occasionally silty, trace interbed tuffs. 3.173 iC4 & nC4 (ppm) 8477 7062 1850 3536 5324 5696 6254 246 9243 8751 8890 8948 9077 9077 Staines Tongue (Lower Sagavanirktok) 9023 9035 2370 8280 8890 9023 Campanian Flooding Surface Prince Creek Upper Schrader Bluff Depth (ft)Gas type & remarks Trip Gas 9344 10812 335 10664 10023 iC5 & nC5 (ppm) Bttms Up Trip Gas at 00:15 hrs.80772 C1 (ppm) LCU (Lower Cretaceous Unconformity) Base HRZ Pebble Shale 8280 9098 558 2046 2566 3732 Depth (TVD) 0 484 8477 Holocene 9913 9210 9903 9222 9235 9285 9531 9048 9294 9540 3732 5520 5892 9218 9085 9085 8480 2566 484 Next 24 Hours Forecast (00h00 to 24h00) -196 0 No Downhole mud losses 1379 Zone Thickness Continue coring ahead with 90' core barrel, Trip out of hole with core. Lower Sagavanirktok Average ROP: 3.3 ft/hr WOB (k): 4-14k RPM (Rot/min): 55 Bit #5 8.5" FC3747 Core Bit Max trip gas 1092 units, Began coring ahead f/9012' Casing shoe: 13 3/8" @ 2441 ft. Casing shoe: 9 5/8" @ 8726.6 ft. Casing and Liner Trip out of hole f/5910'-49' Lay down BHA and clear rig floor Water (% by volume):88% Total depth @ 24h00: 9022'Last Survey: 8687.33'/8682.14'/8.06°/330.88° 120 Tripped in hole, M/U ball drop sub, L/D top single on stnd #85, TIH w/ Std #86+87, Kelleyed up Std #88, washed down at 200gpm, tagged fill @ 9007' wash/rotate to 9012' Mud type: LSND Mud Ground Level: 174.7' Report date: 9/16/2012 Today's date: 9/17/2012 Kelly Bushing level (KB): 196.40' Daily Charges: Spud date: 8/22/2012 Representative: Mike Grubb, Craig Ruminer Daily Progress: 10' Longitude: 148° 42' 48.292 W Previous depth: 9012' Geologist: Paul StilesDays since spud: 24 DAILY GEOLOGICAL AND OPERATIONS REPORT All measurement depths (MD) are quoted per foot from rotary kelly bushing (RKB) Coordinates: WELL : Merak 1 484 207 1355 761 520 RIG: Nabors 105 Bit#5, life/footage: 4.1hrs/10'ROP (min-max): 2-5ft/hr Flow (gpm): 245 Stand pipe pressure (psi): 805 Total Gas (units) Summary lithological description and remarks C2 (ppm) Lower Canning 555 9210 8480 9230 1788 C3 (ppm) 7261 8955 9218 51 10220 1193 372 Latitude: 69° 58' 7.368 N 12 13 Formation Tops From Wellsite Geologist 373 Permafrost Formation Tops/ Markers 7065 7261 691 Top Franklin Bluffs Member (Middle Sagavanirktok) 2046 2046 7392 7392 691 761 5520 5892 2046 Gas Shows and chromatographic analysis 86 133 80864506450 131 1166 Base Franklin Bluffs Member (Middle Sagavanirktok) 1183 1850 1379 Ground Level = 558.162 m, RKB = 567.162 m. Origin Measurement Depths (MD) per foot from RKB. 761 667 Middle Sagavanirktok Depth (SSTVD) 10545 10664 7258 7258 3 10802 10555 10697 10210 33 10358 10477 N/A N/A 10510 10477 3079716 8.5" 10555 10674 10674 10707 119 Report number 29 Job No.:AK-AM-0009498071 Density: 10.6 Daily time-slot 00:00-07:30 07:30-12:00 12:00-14:00 14:00-15:00 15:00-17:00 17:00-19:00 19:00-22:00 22:00-00:00 Comments Interval (ft) 9012'-9028' Max Min Interval (ft) BHA Run #Bit Type Size TFA Hours Footage WOB RPM Condition BHA #6 Bit #4RR1 8.5 1.3 BHA #7 Bit #5 8.5 1.3 ROP Current Avg 24 hr Max Max @ Ft R.O.P. (ft/hr)0 0.75 Depth Ann Corr Drilling Min N/A Avg N/A Max 9028 7.5 0 All Circ Min N/A Avg N/A Max 9716 8.5" 10555 10674 10674 10707 10358 10477 N/A N/A 10510 10477 3 10802 10555 10697 10210 33 307 119 1166 Base Franklin Bluffs Member (Middle Sagavanirktok) 1183 1850 1379 Ground Level = 558.162 m, RKB = 567.162 m. Origin Measurement Depths (MD) per foot from RKB. 761 667 Middle Sagavanirktok Gas Shows and chromatographic analysis 86 133 80864506450 131 10545 10664 7392 7392 691 761 5520 5892 2046 7258 7258 13 Formation Tops From Wellsite Geologist 373 Permafrost Formation Tops/ Markers 7065 7261 691 Top Franklin Bluffs Member (Middle Sagavanirktok) 2046 1788 C3 (ppm) 7261 8955 9218 51 10220 1193 372 C2 (ppm) Lower Canning 555 9210 8480 9230 12 207 1355 761 520 RIG: Nabors 105 Bit#5, life/footage: 7.5hrs/0'ROP (min-max): 0-6.25ft/hr Flow (gpm): 250 Stand pipe pressure (psi): 860 2046 DAILY GEOLOGICAL AND OPERATIONS REPORT All measurement depths (MD) are quoted per foot from rotary kelly bushing (RKB) Coordinates: WELL : Merak 1 484 Latitude: 69° 58' 7.368 N Depth (SSTVD) Representative: Mike Grubb, Craig Ruminer Daily Progress: 6' Longitude: 148° 42' 48.292 W Previous depth: 9022' Geologist: Paul StilesDays since spud: 25 Coring M/U core head RIH w/ barrels, M/U core tubes & space out head, TIH w/ 2 stds H.WT. DP Mud type: LSND Mud Ground Level: 174.7' Report date: 9/17/2012 Today's date: 9/18/2012 Kelly Bushing level (KB): 196.40' Daily Charges: Spud date: 8/22/2012 Water (% by volume):88% Total depth @ 24h00: 9028.'Last Survey: 8687.33'/8682.14'/8.06°/330.88° 80 Average ROP: 0.75 ft/hr WOB (k): 0-14k RPM (Rot/min): 60 Bit #3 12.25" FX65M Core Bit Tripping in hole with new core assembly. Casing shoe: 13 3/8" @ 2441 ft. Casing shoe: 9 5/8" @ 8726.6 ft. Casing and Liner Coring / Core F/ 9012' T/ 9028'. 60 RPM. 250 GPM @ 860 PSI. TQ 2-2.3K. WOB 14K. Stop rotation. P/U to 32K to break core. Trip out of hole F/ 9028' T/5502'. (PMP Dry Job @ 8466' - Blow Down Top Drive) 2566 484 Next 24 Hours Forecast (00h00 to 24h00) -196 0 No Downhole mud losses 1379 Zone Thickness Continue tripping in hole to drill core. Lower Sagavanirktok 5520 5892 9218 9085 9085 8480 Depth (TVD) 0 484 8477 Holocene 9913 9210 9903 9222 9235 8280 9098 558 2046 2566 3732 9285 9048 9294 3732 Bttms Up Trip Gas at 00:15 hrs.5764 C1 (ppm) LCU (Lower Cretaceous Unconformity) Base HRZ Pebble Shale 9531 9540 Total Gas (units) Summary lithological description and remarks Upper Schrader Bluff Depth (ft)Gas type & remarks Trip Gas 9344 10812 335 10664 10023 iC5 & nC5 (ppm) 9077 9077 Staines Tongue (Lower Sagavanirktok) 9023 9035 2370 8280 8890 9023 Campanian Flooding Surface 3.187 iC4 & nC4 (ppm) 8477 7062 1850 3536 5324 5696 6254 246 Trip out of hole F/ 5502' to 3000' Normal Trip Speed. 155K Flow In (spm) 78 Gallons/stroke Lower Kingak TD PWD Kuparauk A Miluveach Upper Kingak Summary Operations Depth KB (MD) Gublik Current Operations Status (00h00 to 04h00) Formation Tops in Red Surface Tops in Blue Undetermined Tops in Black HRZ Kuparauk C Trip out of hole F/ 1000' to core assy. 9 min per stand. 288 495 565 trace-spotty yellow sample fluor Dark gray-brownish balck, mod hard-hard shale, well laminated, occasionally silty, trace interbed tuffs. 9243 8751 Hole Condition On Bot Hrs Avg Diam Top HRZ (Higly Radioactive Zone) 7196 Middle Schrader Bluff Depth In Formation 1386 HRZ 1102 0 Direct fluorescence comment Cut fluorescence comment 512 136 415 27/4330/173 Depth Out 022/35 9012HDBS FX56 FC3747 7.5 6.25 9015' diffuse yellow-yellow white cut fluor, nil streamers Flow In (gpm) 111 9012 Shows Fluorescence 60 max 247 SPP (psi) 838 14k max Current Pump & Flow Data Aug-44 0 Top Shublik Ivishak Base Shublik Fire Creek Kuparauk B Mikkelson Tongue (Upper Canning) Lower Canning MCU (Mid Campanian Unconformity) Hue Shale Prince Creek 10358 10545 Lower Kingak (K-1 Top) Lower Kingak Base 8890 8948 Trip out of hole F/ 3000' to 2000' 4 min per stand. 75K Trip out of hole F/ 2000' to 1000' 6 min per stand. 55K Layed down core PJSM w/ all hands. B/O float sub& core tubes, recovered 14.37' core, changed out top core barrel with new, B/O activation sub & core head. Total Charges: Chlorides (mg/l): 16000 Hardness (mg/l): 10615 Report number 30 Job No.:AK-AM-0009498071 Density: 10.7 Daily time-slot 00:00-07:30 07:30-08:00 08:00-09:30 09:30-12:00 12:00-00:00 Comments Interval (ft) 9028'-9073' Max Min Interval (ft) BHA Run #Bit Type Size TFA Hours Footage WOB RPM Condition BHA #8 Bit #6 8.5 1.3 BHA #7 Bit #5 8.5 1.3 ROP Current Avg 24 hr Max Max @ Ft R.O.P. (ft/hr)1.43 4.15 Depth Ann Corr Drilling Min N/A Avg N/A Max 9073 14.7 0 All Circ Min N/A Avg N/A Max Total Charges: Chlorides (mg/l): 17000 Hardness (mg/l): 10615 10358 10545 Lower Kingak (K-1 Top) Lower Kingak Base 8890 8948 Top Shublik Ivishak Base Shublik Fire Creek Kuparauk B Mikkelson Tongue (Upper Canning) Lower Canning MCU (Mid Campanian Unconformity) Hue Shale Prince Creek 296 SPP (psi) 1087 15 Current Pump & Flow Data 0 16 10.69 9058 diffuse yellow-yellow white cut fluor, nil streamers Flow In (gpm) 0 Shows Fluorescence 60 FC3747 FC3747 7 Depth Out 00 9012 9028 9028 805 0 Direct fluorescence comment Cut fluorescence comment 3014 0 1984 78-120141-653 Hole Condition On Bot Hrs Avg Diam Top HRZ (Higly Radioactive Zone) 7196 Middle Schrader Bluff Depth In Formation 0 HRZ HRZ Kuparauk C 288 495 565 trace-spotty yellow sample fluor Dark gray-brownish balck, mod hard-hard shale, well laminated, occasionally silty, trace interbed tuffs. 9243 8751 PWD Kuparauk A Miluveach Upper Kingak Summary Operations Depth KB (MD) Gublik Current Operations Status (00h00 to 04h00) Formation Tops in Red Surface Tops in Blue Undetermined Tops in Black Tripped in hole f/ 8672' t/ 8929'. Wash dn f/ 8929' t/ 9028'. 300 gpm @ 865 psi. 4' fill on btm. Dropped flow diversion ball and verified seated. Flow In (spm) 93 Gallons/stroke Lower Kingak TD 3.173 iC4 & nC4 (ppm) 8477 7062 1850 3536 5324 5696 6254 246 Staines Tongue (Lower Sagavanirktok) 9023 9035 2370 8280 8890 9023 Campanian Flooding Surface Upper Schrader Bluff Depth (ft)Gas type & remarks 9058 9344 10812 335 10664 10023 iC5 & nC5 (ppm) 41069 C1 (ppm) LCU (Lower Cretaceous Unconformity) Base HRZ Pebble Shale 9531 9540 Total Gas (units) Summary lithological description and remarks 558 2046 2566 3732 9285 9048 9294 3732 9077 9077 Depth (TVD) 0 484 8477 Holocene 9913 9210 9903 9222 9235 5520 5892 9218 9085 9085 8480 2566 484 Next 24 Hours Forecast (00h00 to 24h00) -196 0 No Downhole mud losses 1379 Zone Thickness Continue tripping in hole to drill core. Lower Sagavanirktok Tripping in hole with new core assembly. Casing shoe: 13 3/8" @ 2441 ft. Casing shoe: 9 5/8" @ 8726.6 ft. Casing and Liner Tripped in hole. Changed out jars. RIH w/ HWDP f/ 101' t/ 649'. RIH w/ DP f/ 649' t/ 8672'. L/D single and P/U 15' PUP f/ core spacout. Service top drive and traveling blocks. Cored f/ 9028' t/ 9036'. 70 rpm. 300 gpm @ 1050 psi. TQ 1.8K-3.6K. PUW 195K. SOW 193K. ROT 196K. WOB 14K.Cored f/ 9036' t/ 9073'. 14K on bit. 70 rpm @ 2-7k TQ. Pumping 94 spm. 300 gpm @ 1000-1200 psi. 195 K up. 193K dwn. ROT WT 196K. ROP= 2-10' per hour. Relieved WOB @ 9068' to clear bit. Total depth @ 24h00: 9073'Last Survey: 8687.33'/8682.14'/8.06°/330.88° 60 Average ROP: 4.19 ft/hr WOB (k): 0-14k RPM (Rot/min): 69 Bit #6 8.5" FX65M Core Bit Report date: 9/18/2012 Today's date: 9/19/2012 Kelly Bushing level (KB): 196.40' Daily Charges: Spud date: 8/22/2012 Daily Progress: 45' Longitude: 148° 42' 48.292 W Previous depth: 9028' Geologist: Paul StilesDays since spud: 25 Mud type: LSND Mud Ground Level: 174.7' Water (% by volume):73% DAILY GEOLOGICAL AND OPERATIONS REPORT All measurement depths (MD) are quoted per foot from rotary kelly bushing (RKB) Coordinates: WELL : Merak 1 484 Latitude: 69° 58' 7.368 N Depth (SSTVD) Representative: Mike Grubb, Craig Ruminer 207 1355 761 520 RIG: Nabors 105 Bit#6, life/footage: 44'/14.2Hrs ROP (min-max): 1.19-10.69ft/hr Flow (gpm): 296 Stand pipe pressure (psi): 1078 2046 Lower Canning 555 9210 8480 9230 12 8280 9098 1788 C3 (ppm) 7261 8955 9218 51 10220 1193 372 13 Formation Tops From Wellsite Geologist 373 Permafrost Formation Tops/ Markers 7065 7261 691 Top Franklin Bluffs Member (Middle Sagavanirktok) 2046 10664 7392 7392 691 761 5520 5892 2046 7258 7258 86 133 80864506450 131 1166 Base Franklin Bluffs Member (Middle Sagavanirktok) 1183 1850 1379 Ground Level = 558.162 m, RKB = 567.162 m. Origin Measurement Depths (MD) per foot from RKB. 761 667 Middle Sagavanirktok 3 10802 10555 10697 10210 33 307 119 N/A N/A 10510 Gas Shows and chromatographic analysis C2 (ppm) 9716 8.5" 10555 10674 10674 10707 10358 10477 10477 10545 Report number 31 Job No.:AK-AM-0009498071 Density: 10.85 Daily time-slot 00:00-11:00 11:00-12:00 12:00-12:30 12:30-17:00 17:00-18:00 18:00-19:30 19:30-21:00 21:00-21:30 21:30-23:30 23:30-00:00 Comments Interval (ft) 9028'-9073' Max Min Interval (ft) BHA Run #Bit Type Size TFA Hours Footage WOB RPM Condition BHA #8 Bit #6 8.5 1.3 BHA #7 Bit #5 8.5 1.3 ROP Current Avg 24 hr Max Max @ Ft R.O.P. (ft/hr)N/A 1.53 Depth Ann Corr Drilling Min N/A Avg N/A Max 9089 25.4 0 All Circ Min N/A Avg N/A Max8.5" 10555 10674 10674 10707 10358 10477 10477 10545 N/A N/A 10510 Gas Shows and chromatographic analysis C2 (ppm) 3 10802 10555 10697 10210 33 307 119 1166 Base Franklin Bluffs Member (Middle Sagavanirktok) 1183 1850 1379 Ground Level = 558.162 m, RKB = 567.162 m. Origin Measurement Depths (MD) per foot from RKB. 761 667 Middle Sagavanirktok 5892 2046 7258 7258 86 80864506450 1317261 691 Top Franklin Bluffs Member (Middle Sagavanirktok) 2046 10664 7392 7392 691 761 5520 1788 C3 (ppm) 7261 8955 9218 51 10220 1193 372 555 9210 8480 9230 12 13 133 RIG: Nabors 105 Bit#6, life/footage: 51'/25.4Hrs ROP (min-max): 0.90-2.26ft/hr Flow (gpm): 296 Stand pipe pressure (psi): 1042 2046 Representative: Shane McGeehan, Craig Ruminer 207 1355 761 520 Formation Tops From Wellsite Geologist Permafrost Formation Tops/ Markers Mud type: LSND Mud Ground Level: 174.7' Water (% by volume):87% DAILY GEOLOGICAL AND OPERATIONS REPORT All measurement depths (MD) are quoted per foot from rotary kelly bushing (RKB) Coordinates: WELL : Merak 1 Latitude: 69° 58' 7.368 N Report date: 9/19/2012 Today's date: 9/20/2012 Kelly Bushing level (KB): 196.40' Daily Charges: Spud date: 8/22/2012 Longitude: 148° 42' 48.292 W Geologist: Paul StilesDays since spud: 26 Total depth @ 24h00: 9089'Last Survey: 8687.33'/8682.14'/8.06°/330.88° 100 Average ROP: 1.53 ft/hr WOB (k): 0-14.4k RPM (Rot/min): 65 Bit #6 8.5" FX65M Core Bit Daily Progress: 16'Previous depth: 9073' Pick up MWD tools and trip in hole. Casing shoe: 13 3/8" @ 2441 ft. Casing shoe: 9 5/8" @ 8726.6 ft. Casing and Liner Cored f/ 9073' t/ 9089'. 70 rpm. 300 gpm @ 1050 psi. TQ 1.9K-2.4K. WOB 15K (Stop rotation. P/U 30K overpull to break core) Tripped out of hole f/ 9089' t/8723'. Tripped out of hole f/ 8723' t/ 3000'. Normal running speed. Tripped out of hole f/ 3000' t/ 2000'. 4 min per stand as per HALB Coring Program. Tripped out of hole f/ 1000' t/ core tools @ 9 min per stand. Laid down core / PJSM w/ all hands involved. B/O float sub. Pulled core head to surface and inspected. 484 Next 24 Hours Forecast (00h00 to 24h00) -196 0 No Downhole mud losses 1379 Zone Thickness Drill 1200' to next core section. 484 Depth (SSTVD) Holocene 9913 9210 9903 9222 9235 5520 5892 9218 9085 3732 9077 9077 Depth (TVD) 0 484 8477 9085 8480 2566 9540 Total Gas (units) Summary lithological description and remarks 558 2046 2566 3732 9285 9048 9294 5064 C1 (ppm) LCU (Lower Cretaceous Unconformity) Base HRZ Pebble Shale 9531 9098 373 9716 Depth (ft)Gas type & remarks 9085 9344 10812 335 10664 10023 iC5 & nC5 (ppm) 2370 8280 8890 9023 Campanian Flooding Surface Upper Schrader Bluff Lower Sagavanirktok Lower Canning 8280 7065 3.173 iC4 & nC4 (ppm) 8477 7062 1850 3536 5324 5696 6254 246 Circulate and condition / pump 33 BBL dry job @ 8723'. B/D top drive. Flow In (spm) N/A Gallons/stroke Lower Kingak TD PWD Kuparauk A Miluveach Upper Kingak Summary Operations Depth KB (MD) Gublik Current Operations Status (00h00 to 04h00) Formation Tops in Red Surface Tops in Blue Undetermined Tops in Black HRZ Kuparauk C Tripped out of hole f/ 2000' t/ 1000'. 6 min per stand. 288 495 565 trace-spotty yellow sample fluor Dark gray-brownish balck, mod hard-hard shale, well laminated, occasionally silty, trace interbed tuffs. 9243 8751 Hole Condition On Bot Hrs Avg Diam Top HRZ (Higly Radioactive Zone) 7196 Middle Schrader Bluff Depth In Formation 0 HRZ 62 0 Direct fluorescence comment Cut fluorescence comment 400 0 290 20-4024-123 Depth Out 00 9012 9028 9028FC3747 FC3747 25.4 7 2.26 9076' diffuse yellow-yellow white cut fluor, nil streamers Flow In (gpm) 0 9089 f 60 N/A SPP (psi) N/A 15 Current Pump & Flow Data 0 61 16 Top Shublik Ivishak Base Shublik Fire Creek Kuparauk B Mikkelson Tongue (Upper Canning) Lower Canning MCU (Mid Campanian Unconformity) Hue Shale Prince Creek Laid down core / pulled core tube. Drain top JT. L/D core tubes. P/U core barrel & B/O bit and stabalizer. Set back core barrel in derrick. Cleared and cleaned rig floor. Serviced top drive. Lower Kingak (K-1 Top) Lower Kingak Base 8890 8948 Staines Tongue (Lower Sagavanirktok) 9023 9035 Total Charges: Chlorides (mg/l): 17000 Hardness (mg/l): 10615 10358 10545 Report number 32 Job No.:AK-AM-0009498071 Density: 10.85 Daily time-slot 00:00-04:00 04:00-12:00 12:00-12:30 12:30-15:00 15:00-17:00 17:00-20:00 20:00-21:30 21:30-00:00 Comments Interval (ft) 9089'-9399' Max Min Interval (ft) BHA Run #Bit Type Size TFA Hours Footage WOB RPM Condition BHA #9 Bit #5 8.5 1.3 BHA #8 Bit #6 8.5 1.3 ROP Current Avg 24 hr Max Max @ Ft R.O.P. (ft/hr)N/A 63.25 Depth Ann Corr Drilling Min N/A Avg N/A Max 9407 8.3 0 All Circ Min N/A Avg N/A Max Total Charges: Chlorides (mg/l): 17000 Hardness (mg/l): 10615 10358 10545 Lower Kingak (K-1 Top) Lower Kingak Base 8890 8948 Staines Tongue (Lower Sagavanirktok) 9023 9035 Top Shublik Ivishak Base Shublik Fire Creek Kuparauk B Mikkelson Tongue (Upper Canning) Lower Canning MCU (Mid Campanian Unconformity) Hue Shale Prince Creek 462 SPP (psi) 2380 21.6 Current Pump & Flow Data 0 319 61 147.87 9164 diffuse blue white cut fluor, nil streamers Flow In (gpm) 0 9408 f 56.000FC3747 FC3747 8.1 25.4 90899028 Depth Out 00 9089 connection gas 2240 0 Direct fluorescence comment Cut fluorescence comment 11211 0 4946 232-345428-1545 Hole Condition On Bot Hrs Avg Diam Top HRZ (Higly Radioactive Zone) 7196 Middle Schrader Bluff Depth In Formation 0 Kuparauk A 9089'-9399' Kuparauk C Rotary drilling / slide drill f/ 9217' t/ 9234'. 10K on bit. Pumping 450 gpm @ 2350 psi. Drill f/ 9234' t/ 9313'. 60-80 rpm. 6-8K on bit. 2-4K torque. Pump 475 gpm @ 2450 psi. 288 495 565 trace-spotty yellow sample fluor Medium-light grat, mod hard-hard silty shale, laminated, trace interbed tuffs. 9243 8751 PWD Kuparauk A Miluveach Upper Kingak Summary Operations Depth KB (MD) Gublik Current Operations Status (00h00 to 04h00) Formation Tops in Red Surface Tops in Blue Undetermined Tops in Black Rotary drilled / Mad pass f/ 9030' t/ 9089'. 145' per hr. 40 rpm. 450 gpm. 2150 psi. Rot Wt 205K. 220K up. 198K dwn. Tag fill @ 9087' = 2' fill. 5K on bit to drill out. Flow In (spm) 74 Gallons/stroke Lower Kingak TD 3.173 iC4 & nC4 (ppm) 8477 7062 1850 3536 5324 5696 6254 246 2370 8280 8890 9023 Campanian Flooding Surface Upper Schrader Bluff Lower Sagavanirktok Lower Canning 8280 7065 Gas type & remarks 9364 9344 10812 335 10664 10023 iC5 & nC5 (ppm) gas peaks are pumps off and 185690 C1 (ppm) LCU (Lower Cretaceous Unconformity) Base HRZ Pebble Shale 9531 9098 373 9716 9540 Total Gas (units) Summary lithological description and remarks 558 2046 2566 3732 9285 9048 9294 3732 9077 9077 Depth (TVD) 0 484 8477 9085 8480 2566 Holocene 9913 9210 9903 9222 9235 5520 5892 9218 9085 484 Next 24 Hours Forecast (00h00 to 24h00) -196 0 16.7 bbls lost over shakers. 1379 Zone Thickness Drill 1200' to next core section. 484 Depth (SSTVD) Drilling to next core section. Casing shoe: 13 3/8" @ 2441 ft. Casing shoe: 9 5/8" @ 8726.6 ft. Casing and Liner Picked up BHA. M/U 6.75" directional tools f/ surface t/ 178'. Tripped in hole f/ 178' t/ 9030'. Shallow pulse test @ 331'. 425 gpm @ 1040 psi. Wash dn f/ 8928' t/ 9030'. 40 rpm. 450 gpm @ 2290 psi. Rotary drilled f/ 9234' t/ 9215'. 60 rpm. 10K on bit. 3-5K torque. 71/70 spm. 450 gpm @ 2150 psi. 205K Rot Wt. Get SPR'S @ 9122'. Build volume - weight gas units to 2200. Circ out flow check well. Build mud wt to 11.0 ppg. Pumping 300/ 350 gpm @ 1050 / 1430 psi. Slide drilling f/ 9313/ to 9334'. 8K on bit. Pumping 76/73 spm. 475 gpm @ 2450 psi. Rotary drilling f/ 9334' t/ 9405'. 60-80 rpm. 8-16K on bit. 3-5k torque. Pump 450 gpm @ 2215 psi. 475 gpm @ 2430 psi. Last Survey: 8687.33'/8682.14'/8.06°/330.88° 60 Average ROP: 63.25 ft/hr WOB (k): 0-21.6k RPM (Rot/min): 56 Bit #5 8.5" FX56 PDC Bit Daily Progress: 319'Previous depth: 9089' Daily Charges: Spud date: 8/22/2012 Longitude: 148° 42' 48.292 W Geologist: Paul StilesDays since spud: 27 Total depth @ 24h00: 9408' DAILY GEOLOGICAL AND OPERATIONS REPORT All measurement depths (MD) are quoted per foot from rotary kelly bushing (RKB) Coordinates: WELL : Merak 1 Latitude: 69° 58' 7.368 N Report date: 9/20/2012 Today's date: 9/21/2012 Kelly Bushing level (KB): 196.40' Representative: Shane McGeehan, Craig Ruminer 207 1355 761 520 Formation Tops From Wellsite Geologist Permafrost Formation Tops/ Markers Mud type: LSND Mud RIG: Nabors 105 Bit#5, life/footage: 330.97'/8.4Hrs ROP (min-max): 0.90-2.26ft/hr Flow (gpm): 462 Stand pipe pressure (psi): 2478 2046 Ground Level: 174.7' Water (% by volume):86% 555 9210 8480 9230 12 13 133 1788 C3 (ppm) 7261 8955 9218 51 10220 1193 372 7261 691 Top Franklin Bluffs Member (Middle Sagavanirktok) 2046 10664 7392 7392 691 761 5520 5892 2046 7258 7258 86 80864506450 131 1166 Base Franklin Bluffs Member (Middle Sagavanirktok) 1183 1850 1379 Ground Level = 558.162 m, RKB = 567.162 m. Origin Measurement Depths (MD) per foot from RKB. 761 667 Middle Sagavanirktok 3 10802 10555 10697 10210 33 307 119 N/A N/A 10510 Gas Shows and chromatographic analysis C2 (ppm) 8.5" 10555 10674 10674 10707 10358 10477 10477 10545 Depth (ft) Report number 33 Job No.:AK-AM-0009498071 Density: 11.4 Daily time-slot 00:00-12:00 12:00-20:00 20:00-21:30 21:30-00:00 Comments Interval (ft) 9396'(TVD)-10600(TVD) Max Min Interval (ft) BHA Run #Bit Type Size TFA Hours Footage WOB RPM Condition BHA #9 Bit #5 8.5 1.3 BHA #8 Bit #6 8.5 1.3 ROP Current Avg 24 hr Max Max @ Ft R.O.P. (ft/hr)N/A 104.75 Depth Ann Corr Drilling Min N/A Avg N/A Max 10,611.22'22.2 0 All Circ Min N/A Avg N/A Max8.5" 10555 10674 10674 10707 10358 10477 10477 10545 Depth (ft) N/A N/A 10510 Gas Shows and chromatographic analysis C2 (ppm) 3 10802 10555 10697 10210 33 307 119 1166 Base Franklin Bluffs Member (Middle Sagavanirktok) 1183 1850 1379 Ground Level = 558.162 m, RKB = 567.162 m. Origin Measurement Depths (MD) per foot from RKB. 761 667 Middle Sagavanirktok 5892 2046 7258 7258 86 80864506450 1317261 691 Top Franklin Bluffs Member (Middle Sagavanirktok) 2046 10664 7392 7392 691 761 5520 1788 C3 (ppm) 7261 8955 9218 51 10220 1193 372 555 9210 8480 9230 12 13 133 RIG: Nabors 105 Bit#5, footage/life: 1521.97'/22.2HrsROP (min-max): 0.90-2.26ft/hr Flow (gpm): 474 Stand pipe pressure (psi): 2973 2046 Ground Level: 174.7' Water (% by volume):85% Representative: Shane McGeehan, Craig Ruminer 207 1355 761 520 Formation Tops From Wellsite Geologist Permafrost Formation Tops/ Markers Mud type: LSND Mud DAILY GEOLOGICAL AND OPERATIONS REPORT All measurement depths (MD) are quoted per foot from rotary kelly bushing (RKB) Coordinates: WELL : Merak 1 Latitude: 69° 58' 7.368 N Report date: 9/21/2012 Today's date: 9/22/2012 Kelly Bushing level (KB): 196.40' Daily Charges: Spud date: 8/22/2012 Longitude: 148° 42' 48.292 W Geologist: Paul StilesDays since spud: 31 Total depth @ 24h00: 10,611'Last Survey: 10560.93'/10548.66'/8.06°/330.88° 40 Average ROP: 104.75 ft/hr WOB (k): 0-26.8k RPM (Rot/min): 85 Bit #5 8.5" FX56 PDC Bit Daily Progress: 1,203'Previous depth: 9,408' Tripping out to pick up coring bit. Casing shoe: 13 3/8" @ 2441 ft. Casing shoe: 9 5/8" @ 8726.6 ft. Casing and Liner Rotary drilling f/ 9405' t/ 10078'. 90 rpm. 475 gpm. Press on 2890 psi. Press off 2680 psi. Tq on 3k-4k. Tq off 3k. PUW 220k. SOW 218k. ROT 210k. WOB 10-14k. (Slide f/ 9405' t/ 9420', f/ 9431' t/ 9437', f/ 9479' t/ 9482') Circulate and condition / CBU @ 10611'. 475 gpm. 2680 psi. Pump 20 bbl high vis. Sweep. CBU. Rotate 40 rpm. 4k Tq. Reciprocate pipe. Get slow pump rates. Trip out of hole / monitor well (well static) f/ 10611' t/… Next 24 Hours Forecast (00h00 to 24h00) -196 0 142 bbls lost to SCE. No other losses. 1379 Zone Thickness Trip in with coring bit and begin drilling of next core section. 484 Depth (SSTVD) Holocene 9913 9210 9903 9222 9235 5520 5892 9218 9180 9171 9171 Depth (TVD) 0 484 8477 9180 8480 2566 484 Total Gas (units) Summary lithological description and remarks 558 2046 2566 3732 9285 9048 9294 3732 C1 (ppm) LCU (Lower Cretaceous Unconformity) Base HRZ Pebble Shale 9531 9098 373 9716 9540 Gas type & remarks 10,600 9344 10812 335 10664 10023 iC5 & nC5 (ppm) background peak was at 2370 8280 8975 9023 Campanian Flooding Surface Upper Schrader Bluff Lower Sagavanirktok Lower Canning 8280 7065 3.173 iC4 & nC4 (ppm) 8477 7062 1850 3536 5324 5696 6254 246 Rotary drilling f/ 10078' t/ 10611'. 80 rpm. 475 gpm. Press on 3000 psi. Press off 2680 psi. Tq on 3-7k. Tq off 3-5k. PUW 230k. ROT 217k. WOB 10-20k. Flow In (spm) 0 Gallons/stroke Lower Kingak TD PWD Kuparauk A Miluveach Upper Kingak Summary Operations Depth KB (MD) Gublik Current Operations Status (00h00 to 04h00) Formation Tops in Red Surface Tops in Blue Undetermined Tops in Black 9408'-10611' Kuparauk C 288 495 565 occasional trace-spotty yellow-white sample fluor Shale: Medium-dark gry, soft silty shale, occasionally laminated with occasional pyrite and traces of glauconite. 9243 8751 Hole Condition On Bot Hrs Avg Diam Top HRZ (Higly Radioactive Zone) 7196 Middle Schrader Bluff Depth In Formation 0 Lower Kingak 1738 0 Direct fluorescence comment Cut fluorescence comment 20360 0 6891 451-402941-1715102162 Depth Out 00 9408 beginning of coring point FC3747 FC3747 22.2 8.1 94089098 181 10569 diffuse blue white cut fluor, occasional streamers Flow In (gpm) 0 10611 f 56.000 0 SPP (psi) 0 21.6 Current Pump & Flow Data 0 1203 319 Top Shublik Ivishak Base Shublik Fire Creek Kuparauk B Mikkelson Tongue (Upper Canning) Lower Canning MCU (Mid Campanian Unconformity) Hue Shale Prince Creek Lower Kingak (K-1 Top) Lower Kingak Base 8975 8948 Staines Tongue (Lower Sagavanirktok) 9023 9035 Total Charges: Chlorides (mg/l): 16000 Hardness (mg/l): 10615 10358 10545 Report number 34 Job No.:AK-AM-0009498071 Density: 11.4 Daily time-slot 00:00-08:00 08:00-11:00 11:00-12:00 12:00-13:00 13:00-18:30 18:30-20:00 20:00-00:00 Comments Interval (ft) 9396'(TVD)-10600(TVD) Max Min Interval (ft) BHA Run #Bit Type Size TFA Hours Footage WOB RPM Condition BHA #10 Bit #1 8.5 1.3 BHA #9 Bit #5 8.5 1.3 ROP Current Avg 24 hr Max Max @ Ft R.O.P. (ft/hr)N/A N/A Depth Ann Corr Drilling Min N/A Avg N/A Max 10,611'28.5 0 All Circ Min N/A Avg N/A Max Total Charges: Chlorides (mg/l): 16000 Hardness (mg/l): 10615 10358 10545 Lower Kingak (K-1 Top) Lower Kingak Base 8975 8948 Staines Tongue (Lower Sagavanirktok) 9023 9035 Top Shublik Ivishak Base Shublik Fire Creek Kuparauk B Mikkelson Tongue (Upper Canning) Lower Canning MCU (Mid Campanian Unconformity) Hue Shale Prince Creek 0 SPP (psi) 0 N/A 21.6 Current Pump & Flow Data 0 0 1203 N/A N/A diffuse blue white cut fluor, occasional streamers Flow In (gpm) 0 10611 f N/A 56 FC3747 HDBS FX56 PDC 0 22.2 106119408 Depth Out 00 10611 9 0 Direct fluorescence comment Cut fluorescence comment 1722 0 768 81-55131-2037305 Hole Condition On Bot Hrs Avg Diam Top HRZ (Higly Radioactive Zone) 7196 Middle Schrader Bluff Depth In Formation 0 Lower Kingak 9408'-10611' Kuparauk C Install / remove wear bushing / L/D test jnt. Pulled test plug. Set wear ring. R/D testing equipment. Cln & clr rig floor. Blow down choke manifold and kill line. (Off load mud. Take on 288 495 565 occasional trace-spotty yellow-white sample fluor Shale: Medium-dark gry, soft silty shale, occasionally laminated with occasional pyrite and traces of glauconite. 9243 8751 PWD Kuparauk A Miluveach Upper Kingak Summary Operations Depth KB (MD) Gublik Current Operations Status (00h00 to 04h00) Formation Tops in Red Surface Tops in Blue Undetermined Tops in Black PU test tools / drain stack. Rig up to test BOP. Flow In (spm) 0 Gallons/stroke Lower Kingak TD 3.173 iC4 & nC4 (ppm) 8477 7062 1850 3536 5324 5696 6254 246 2370 8280 8975 9023 Campanian Flooding Surface Upper Schrader Bluff Lower Sagavanirktok Lower Canning 8280 7065 Gas type & remarks N/A 9344 10812 335 10664 10023 iC5 & nC5 (ppm) Trip gas C1 (ppm) LCU (Lower Cretaceous Unconformity) Base HRZ Pebble Shale 9531 9098 373 9716 9540 Total Gas (units) Summary lithological description and remarks 558 2046 2566 3732 9285 9048 9294 3732 Depth (TVD) 0 484 8477 9180 8480 2566 484 9913 9210 9903 9222 9235 5520 5892 9218 9180 9171 Next 24 Hours Forecast (00h00 to 24h00) -196 0 9 barrels lost to SCE. 1379 Zone Thickness Core next core section. 484 Depth (SSTVD) Holocene Tripping in with coring assembly. Casing shoe: 13 3/8" @ 2441 ft. Casing shoe: 9 5/8" @ 8726.6 ft. Casing and Liner Trip out of hole f/ 9586' t/ 728'. Stand back BHA f/ 728' t/ 88'. Pumped 20 bbls 12.7 ppg dry job @ casing shoe. Lay down BHA / L/D 6.75 directional tools f/ 88' t/ surf. Cln & clr rig floor. Install / remove wear bushing / remove wear ring. Set test plug. L/D single. P/U test joint. Fill stack. Prep testing equipment. Test BOP / test BOP and related valves 250 psi low, 5000 psi high. Annular 250 low, 3500 high. Chart & hold 5 min. BOP test waived by AOGCC Inspector Lou Grimaldt. new mud) Trip in hole M/U 90' core barrel assy t/ 98'. RIH HWDP from derrick and pipe shed t/ 895'. RIH DP out of derric f/ 895' t/ 2324' (function test desilter system) Last Survey: 10560.93'/10548.66'/8.06°/330.88° 40 Average ROP: N/A WOB (k): N/A RPM (Rot/min): N/A Bit #1 8.5" FC3747 CORE Bit Daily Progress: 0'Previous depth: 10,611' Spud date: 8/22/2012 Longitude: 148° 42' 48.292 W Geologist: Paul StilesDays since spud: 32 Total depth @ 24h00: 10,611' DAILY GEOLOGICAL AND OPERATIONS REPORT All measurement depths (MD) are quoted per foot from rotary kelly bushing (RKB) Coordinates: WELL : Merak 1 Latitude: 69° 58' 7.368 N Report date: 9/22/2012 Today's date: 9/23/2012 Kelly Bushing level (KB): 196.40' Representative: Shane McGeehan, Craig Ruminer 207 1355 761 520 Formation Tops From Wellsite Geologist Permafrost Formation Tops/ Markers Mud type: LSND Mud Daily Charges: RIG: Nabors 105 Bit#1, footage/life: N/A ROP (min-max): N/A Flow (gpm): 0 Stand pipe pressure (psi): 0 2046 Ground Level: 174.7' Water (% by volume):84% 555 9210 8480 9230 12 13 133 9171 1788 C3 (ppm) 7261 8955 9218 51 10220 1193 372 7261 691 Top Franklin Bluffs Member (Middle Sagavanirktok) 2046 10664 7392 7392 691 761 5520 5892 2046 7258 7258 86 80864506450 131 1166 Base Franklin Bluffs Member (Middle Sagavanirktok) 1183 1850 1379 Ground Level = 558.162 m, RKB = 567.162 m. Origin Measurement Depths (MD) per foot from RKB. 761 667 Middle Sagavanirktok 3 10802 10555 10697 10210 33 307 119 N/A N/A 10510 Gas Shows and chromatographic analysis C2 (ppm) 8.5" 10555 10674 10674 10707 10358 10477 10477 10545 Depth (ft) Report number 35 Job No.:AK-AM-0009498071 Density: 11.4 Daily time-slot 00:00-05:30 05:30-06:00 06:00-07:00 07:00-12:00 12:00-13:30 13:30-00:00 Comments Interval (ft) 9396'(TVD)-10600(TVD) Max Min Interval (ft) BHA Run #Bit Type Size TFA Hours Footage WOB RPM Condition BHA #10 Bit #1 8.5 1.3 BHA #9 Bit #5 8.5 1.3 ROP Current Avg 24 hr Max Max @ Ft R.O.P. (ft/hr)2 2.33 Depth Ann Corr Drilling Min N/A Avg N/A Max 10635 44.3 0 All Circ Min N/A Avg N/A Max Depth (ft)C2 (ppm) 8.5" 10555 10674 10674 10707 10358 10477 10477 307 119 N/A N/A 10510 Gas Shows and chromatographic analysis 10802 10555 10697 10210 33 10545 1166 Base Franklin Bluffs Member (Middle Sagavanirktok) 1183 1850 1379 Ground Level = 558.162 m, RKB = 567.162 m. Origin Measurement Depths (MD) per foot from RKB. 761 667 Middle Sagavanirktok 7258 86 80864506450 131 3 Top Franklin Bluffs Member (Middle Sagavanirktok) 2046 10664 7392 7392 691 761 5520 5892 2046 1788 C3 (ppm) 7261 8955 9218 51 10220 1193 372 555 9210 8480 9230 12 13 133 9171 RIG: Nabors 105 Bit#1, footage/life: 25'/10.8 ROP (min-max): 0.9-5.96 Flow (gpm): 294 Stand pipe pressure (psi): 1190 2046 Ground Level: 174.7' Water (% by volume):84% Representative: Shane McGeehan, Craig Ruminer 207 1355 761 520 Formation Tops From Wellsite Geologist Permafrost Formation Tops/ Markers Mud type: LSND Mud Daily Charges: DAILY GEOLOGICAL AND OPERATIONS REPORT All measurement depths (MD) are quoted per foot from rotary kelly bushing (RKB) Coordinates: WELL : Merak 1 Latitude: 69° 58' 7.368 N Report date: 9/23/2012 Today's date: 9/24/2012 Kelly Bushing level (KB): 196.40' Spud date: 8/22/2012 Longitude: 148° 42' 48.292 W Geologist: Paul StilesDays since spud: 33 Total depth @ 24h00: 10,611'Last Survey: 10560.93'/10548.66'/8.06°/330.88° 60 Average ROP: 2.33 WOB (k): 20.2 RPM (Rot/min): 60 Bit #1 8.5" FC3747 CORE Bit Daily Progress: 0'Previous depth: 10,611' Tripped in and began coring. Casing shoe: 13 3/8" @ 2441 ft. Casing shoe: 9 5/8" @ 8726.6 ft. Casing and Liner Trip in hole f/ 2324' t/ 8694'. Service rig top drive & traveling blocks. Reaming / Washing / ream dn f/ 9242'' t/ 10611'. 10 rpm. 300 gpm @ 1050 psi. ( pmp 22 bbl hi vis sweep ). Circulate and condition @ 10611'. Circulate sweep to surface. 335 gpm @ 1050 psi. 50 rpm. 2-4k Tq. Observed 2,600 units of gas. 0.8 ppg gas cut mud. Drop ball @ 1300 hrs. Coring f/ 10611' t/ 10635'. 14k WOB. 95 spm @ 300 gpm. 1100 psi on. 1100 psi off. 3-8k Tq on. 2-4k Tq off. 236k UWT. 235k RWT. 70 rpm. Next 24 Hours Forecast (00h00 to 24h00) -196 0 15.4 bbls lost to SCE. 1379 Zone Thickness Continue coring. 484 Depth (SSTVD) Holocene 9210 9903 9222 9235 5520 5892 9218 9180 9171 7261 Depth (TVD) 0 484 8477 9180 8480 2566 484 691 7258 Total Gas (units) Summary lithological description and remarks 558 2046 2566 3732 9285 9048 9294 3732 C1 (ppm) LCU (Lower Cretaceous Unconformity) Base HRZ Pebble Shale 9531 9098 373 9716 9540 Gas type & remarks 10,616 9344 10812 335 10664 10023 iC5 & nC5 (ppm) Coring 9913 2370 8280 8975 9023 Campanian Flooding Surface Upper Schrader Bluff Lower Sagavanirktok Lower Canning 8280 7065 3.173 iC4 & nC4 (ppm) 8477 7062 1850 3536 5324 5696 6254 246 Trip in hole f/ 8694' t/ 9242'. Packed off @ 9242'. Back ream out. 40 rpm. 300 gpm @ 950 psi. Flow In (spm) 43 Gallons/stroke Lower Kingak TD PWD Kuparauk A Miluveach Upper Kingak Summary Operations Depth KB (MD) Gublik Current Operations Status (00h00 to 04h00) Formation Tops in Red Surface Tops in Blue Undetermined Tops in Black 10611'-10635 Kuparauk C Establish coring parameters. Slow pump rates. 288 495 565 occasional trace-spotty yellow-white sample fluor Shale: Medium-dark gry, soft silty shale, occasionally laminated with occasional pyrite and traces of glauconite. 9243 8751 Hole Condition On Bot Hrs Avg Diam Top HRZ (Higly Radioactive Zone) 7196 Middle Schrader Bluff Depth In Formation 0 Lower Kingak 745 0 Direct fluorescence comment Cut fluorescence comment 5373 0 1972 126-102229-45845903 Depth Out 00 10611FC3747 HDBS FX56 PDC 10.8 22.2 106119408 5.96 10630 diffuse blue white cut fluor, occasional streamers Flow In (gpm) 0 10635 f 69.000 56 294 SPP (psi) 1180 14.5 21.6 Current Pump & Flow Data 0 24 1203 Top Shublik Ivishak Base Shublik Fire Creek Kuparauk B Mikkelson Tongue (Upper Canning) Lower Canning MCU (Mid Campanian Unconformity) Hue Shale Prince Creek Lower Kingak (K-1 Top) Lower Kingak Base 8975 8948 Staines Tongue (Lower Sagavanirktok) 9023 9035 Total Charges: Chlorides (mg/l): 17000 Hardness (mg/l): 10615 10358 10545 Report number 36 Job No.:AK-AM-0009498071 Density: 11.6 Daily time-slot 00:00-15:00 1500:-15:30 15:30-16:00 16:00-00:00 Comments Interval (ft) 10635'-10660' MD Max Min Interval (ft) BHA Run #Bit Type Size TFA Hours Footage WOB RPM Condition BHA #10 Bit #1 8.5 1.3 BHA #9 Bit #5 8.5 1.3 ROP Current Avg 24 hr Max Max @ Ft R.O.P. (ft/hr)N/A 1.87 Depth Ann Corr Drilling Min N/A Avg N/A Max 10660 26 0 All Circ Min N/A Avg N/A Max Total Charges: Chlorides (mg/l): 18000 Hardness (mg/l): 10615 10358 10545 Lower Kingak (K-1 Top) Lower Kingak Base 8975 8948 Staines Tongue (Lower Sagavanirktok) 9023 9035 Ivishak Base Shublik Fire Creek Kuparauk B Mikkelson Tongue (Upper Canning) Lower Canning MCU (Mid Campanian Unconformity) Hue Shale Prince Creek N/A SPP (psi) N/A 10.7 21.6 Current Pump & Flow Data 0 49 1203 6.82 10659 diffuse blue white cut fluor, occasional streamers Flow In (gpm) 0 10660 f 2.330 56 FC3747 HDBS FX56 PDC 26 22.2 106119408 Depth Out 00 10611 175 0 Direct fluorescence comment Cut fluorescence comment 1391 0 568 155-112352-3777664 Hole Condition On Bot Hrs Avg Diam Top HRZ (Higly Radioactive Zone) 7196 Middle Schrader Bluff Depth In Formation 0 Lower Kingak 10635'-10660' MD Kuparauk C 288 495 565 occasional trace-spotty yellow-white sample fluor Shale: Medium-dark gry, soft silty shale, occasionally laminated with occasional traces of pyrite. 9243 8751 PWD Kuparauk A Miluveach Upper Kingak Summary Operations Depth KB (MD) Gublik Current Operations Status (00h00 to 04h00) Formation Tops in Red Surface Tops in Blue Undetermined Tops in Black Cored from 10659' to 10660'. Average gas 32 units, max 46 units. Flow In (spm) N/A Gallons/stroke Lower Kingak TD 3.173 iC4 & nC4 (ppm) 8477 7062 1850 3536 5324 5696 6254 246 2370 8280 8975 9023 Campanian Flooding Surface Upper Schrader Bluff Lower Sagavanirktok Lower Canning 8280 7065 Gas type & remarks 10,659 9344 10812 335 10664 10023 iC5 & nC5 (ppm) Coring 9913 C1 (ppm) LCU (Lower Cretaceous Unconformity) Base HRZ Pebble Shale 9531 9098 373 9716 9540 Total Gas (units) Summary lithological description and remarks 558 2046 2566 3732 9285 9048 9294 3732 Depth (TVD) 0 484 8477 9180 8480 2566 484 691 7258 9903 9222 9235 5520 5892 9218 9180 9171 7261 Next 24 Hours Forecast (00h00 to 24h00) -196 0 9.7 bbls lost to SCE. 1379 Zone Thickness Continue tripping out of hole, lay down core and trip in for next coring run. 484 Depth (SSTVD) Holocene Continue tripping out of hole. Casing shoe: 13 3/8" @ 2441 ft. Casing shoe: 9 5/8" @ 8726.6 ft. Casing and Liner Coring from 10635' to 10659'. Average gas 39 units. Max gas 175 units. Attempted to break core and noticed catcher slipping. Tripping out of hole. Observed clean break off of core. Last Survey: 10560.93'/10548.66'/8.06°/330.88° 60 Average ROP: 1.87 WOB (k): 14.0 RPM (Rot/min): 67 Bit #1 8.5" FC3747 CORE Bit Daily Progress: 25'Previous depth: 10,635' Spud date: 8/22/2012 Longitude: 148° 42' 48.292 W Geologist: Paul StilesDays since spud: 34 Total depth @ 24h00: 10,660' DAILY GEOLOGICAL AND OPERATIONS REPORT All measurement depths (MD) are quoted per foot from rotary kelly bushing (RKB) Coordinates: WELL : Merak 1 Latitude: 69° 58' 7.368 N Report date: 9/24/2012 Today's date: 9/25/2012 Kelly Bushing level (KB): 196.40' Representative: Shane McGeehan, Craig Ruminer 207 1355 761 520 Formation Tops From Wellsite Geologist Permafrost Formation Tops/ Markers Mud type: LSND Mud Daily Charges: RIG: Nabors 105 Bit#1, footage/life: 49'/26hrs ROP (min-max): 1.29-6.82 Flow (gpm): 293.2 Stand pipe pressure (psi): 1181 2046 Ground Level: 174.7' Water (% by volume):84% 9210 8480 9230 12 13 133 9171 9210 1788 C3 (ppm) 7261 8955 9218 51 10220 1193 372 Top Franklin Bluffs Member (Middle Sagavanirktok) 2046 10664 7392 7392 691 761 5520 5892 2046 7258 86 80864506450 131 3 555 1166 Base Franklin Bluffs Member (Middle Sagavanirktok) 1183 1850 1379 Ground Level = 558.162 m, RKB = 567.162 m. Origin Measurement Depths (MD) per foot from RKB. 761 667 Middle Sagavanirktok Gas Shows and chromatographic analysis 10802 10555 10697 10210 33 10545Top Shublik 10477 307 119 N/A N/A 10510 Depth (ft)C2 (ppm) 8.5" 10555 10674 10674 10707 10358 10477 Report number 37 Job No.:AK-AM-0009498071 Density: 11.6 Daily time-slot 00:00-05:00 05:00-06:00 06:00-07:00 07:00-14:00 14:00-16:30 16:30-21:00 21:00-22:00 22:00-24:00 Comments Interval (ft) 10660'-10707' Max Min Interval (ft) BHA Run #Bit Type Size TFA Hours Footage WOB RPM Condition BHA #11 Bit #9 8.5 1.3 BHA #10 Bit #1 8.5 1.3 ROP Current Avg 24 hr Max Max @ Ft R.O.P. (ft/hr)9.9 39.9 Depth Ann Corr Drilling Min N/A Avg N/A Max 10707 2.2 0 All Circ Min N/A Avg N/A Max C2 (ppm) 8.5" 10555 10674 10674 10707 10358 10477 307 119 N/A N/A 10510 Depth (ft) 10210 33 10545Top Shublik 10477 Ground Level = 558.162 m, RKB = 567.162 m. Origin Measurement Depths (MD) per foot from RKB. 761 667 Middle Sagavanirktok Gas Shows and chromatographic analysis 10802 10555 10697 131 3 555 1166 Base Franklin Bluffs Member (Middle Sagavanirktok) 1183 1850 1379 691 761 5520 5892 2046 7258 64506450 1193 372 Top Franklin Bluffs Member (Middle Sagavanirktok) 2046 10664 7392 7392 86 808 9171 9210 1788 C3 (ppm) 7261 8955 9218 51 10220 8480 9230 12 13 133 RIG: Nabors 105 Bit#1, footage/life: 49'/26hrs ROP (min-max): 0.0-39.89 Flow (gpm): 293.2 Stand pipe pressure (psi): 954 2046 Ground Level: 174.7' Water (% by volume):83% Representative: Shane McGeehan, Craig Ruminer 207 1355 761 520 Formation Tops From Wellsite Geologist Permafrost Formation Tops/ Markers Mud type: LSND Mud Daily Charges: DAILY GEOLOGICAL AND OPERATIONS REPORT All measurement depths (MD) are quoted per foot from rotary kelly bushing (RKB) Coordinates: WELL : Merak 1 Latitude: 69° 58' 7.368 N Report date: 9/25/2012 Today's date: 9/26/2012 Kelly Bushing level (KB): 196.40' Spud date: 8/22/2012 Longitude: 148° 42' 48.292 W Geologist: Paul StilesDays since spud: 35 Total depth @ 24h00: 10,707'Last Survey: 10560.93'/10548.66'/8.06°/330.88° 60 Average ROP: 39.9 (While Drilling) WOB (k): 8.14 RPM (Rot/min): 69 Bit #9 8.5" FC3648 CORE Bit Daily Progress: 47'Previous depth: 10,635' Coring Casing shoe: 13 3/8" @ 2441 ft. Casing shoe: 9 5/8" @ 8726.6 ft. Casing and Liner Tripped out of hole from 2800' to surface. Trip gas minimal. No mud losses. Laid down core. 48.8' or core recovered. Tripped in hole from surface to 8702'. Rig service. Circulated and conditioned. Pumped sweep and contuned pumping bottoms up. Observed 1.7 ppg gas cut mud and 3270 units trip gas. Coring from 10,660' to 10706'. Average background gas 172 units, max 274 units. Next 24 Hours Forecast (00h00 to 24h00) -196 0 7.8 bbls lost to SCE. 1379 Zone Thickness Finish core run and trip out of hole with core. 484 Depth (SSTVD) Holocene 9903 9222 9235 5520 5892 9218 9180 9171 7261 9210 Depth (TVD) 0 484 8477 9180 8480 2566 484 691 7258 Total Gas (units) Summary lithological description and remarks 558 2046 2566 3732 9285 9048 9294 3732 C1 (ppm) LCU (Lower Cretaceous Unconformity) Base HRZ Pebble Shale 9531 9098 373 9716 9540 Gas type & remarks N/A 9344 10812 335 10664 10023 iC5 & nC5 (ppm) Trip Gas 9913 2370 8280 8975 9023 Campanian Flooding Surface Upper Schrader Bluff Lower Sagavanirktok Lower Canning 8280 7065 3.173 iC4 & nC4 (ppm) 8477 7062 1850 3536 5324 5696 6254 246 Changed out bit. Flow In (spm) 36 Gallons/stroke Lower Kingak TD PWD Kuparauk A Miluveach Upper Kingak Summary Operations Depth KB (MD) Gublik Current Operations Status (00h00 to 04h00) Formation Tops in Red Surface Tops in Blue Undetermined Tops in Black 10660'-10707' MD Kuparauk C Tripped in hole from 8702' to 10656'. 288 495 565 occasional trace-spotty yellow-white sample fluor Shale: Medium-dark gry, soft silty shale, occasionally laminated with occasional traces of pyrite. 9243 8751 Hole Condition On Bot Hrs Avg Diam Top HRZ (Higly Radioactive Zone) 7196 Middle Schrader Bluff Depth In Formation 0 Lower Kingak 3280 0 Direct fluorescence comment Cut fluorescence comment 12143 0 3763 212-135455-76679749 Depth Out 00 10660 Bit is newFG3648 FC3747 4.1 26 1066010611 61.75 10677 diffuse blue white cut fluor, occasional streamers Flow In (gpm) 0 10707 70.000 2.330 248 SPP (psi) 880 8.1 10.7 Current Pump & Flow Data 0 49 49 Ivishak Base Shublik Fire Creek Kuparauk B Mikkelson Tongue (Upper Canning) Lower Canning MCU (Mid Campanian Unconformity) Hue Shale Prince Creek Lower Kingak (K-1 Top) Lower Kingak Base 8975 8948 Staines Tongue (Lower Sagavanirktok) 9023 9035 Total Charges: Chlorides (mg/l): 18000 Hardness (mg/l): 10615 10358 10545 Report number 38 Job No.:AK-AM-0009498071 Density: 11.8 Daily time-slot 00:00-03:30 03:30-09:00 09:00-10:00 10:00-19:30 19:30-20:30 20:30-24:00 Comments Interval (ft) 10726'-10748' Max Min Interval (ft) BHA Run #Bit Type Size TFA Hours Footage WOB RPM Condition BHA #11 Bit #9 8.5 1.3 BHA #10 Bit #1 8.5 1.3 ROP Current Avg 24 hr Max Max @ Ft R.O.P. (ft/hr)N/A 21.94 Depth Ann Corr Drilling Min N/A Avg N/A Max 10748 N/A 0 All Circ Min N/A Avg N/A Max Total Charges: Chlorides (mg/l): 26000 Hardness (mg/l): 10615 10358 10545 Lower Kingak (K-1 Top) Lower Kingak Base 8975 8948 Staines Tongue (Lower Sagavanirktok) 9023 9035 Ivishak Base Shublik Fire Creek Kuparauk B Mikkelson Tongue (Upper Canning) Lower Canning MCU (Mid Campanian Unconformity) Hue Shale Prince Creek N/A SPP (psi) N/A 8.3 10.7 Current Pump & Flow Data 0 88 49 58.17 10724 No cut. No stain. Flow In (gpm) 0 10748 69.000 2.330 FG3648 FC3747 29 26 1066010611 Depth Out 00 10660 925 0 Direct fluorescence comment Cut fluorescence comment 11320 0 2903 185-83485-43665247 Hole Condition On Bot Hrs Avg Diam Top HRZ (Higly Radioactive Zone) 7196 Middle Schrader Bluff Depth In Formation 0 Shublik 10740'-10748' Kuparauk C Tripped in hole to 4690', filling every 2000'. Average trip gas 3 units with a max of 371 units. 288 495 565 No petro fluor. Shale: Medium-dark gry, firm silty shale, with occasional traces of pyrite. Coupled with gray to cream white, fossiliferous wackestone. 9243 8751 PWD Kuparauk A Miluveach Upper Kingak Summary Operations Depth KB (MD) Gublik Current Operations Status (00h00 to 04h00) Formation Tops in Red Surface Tops in Blue Undetermined Tops in Black Circulate and condition. Flow In (spm) N/A Gallons/stroke Lower Kingak TD 3.173 iC4 & nC4 (ppm) 8477 7062 1850 3536 5324 5696 6254 246 8280 8975 9023 Campanian Flooding Surface Upper Schrader Bluff Lower Sagavanirktok Lower Canning 8280 7065 Gas type & remarks 10,717 9344 10812 335 10664 10023 iC5 & nC5 (ppm) Background 9913 C1 (ppm) LCU (Lower Cretaceous Unconformity) Base HRZ Pebble Shale 9531 9098 373 9716 9540 Summary lithological description and remarks 558 2046 2566 3732 9285 9048 9294 3732 2370 8477 9180 8480 2566 484 691 7258 9903 9222 9235 5520 5892 9218 9180 9171 7261 9210 5.23 bbls lost to SCE. 1379 Zone Thickness Trip to bottom and core next core section. 484 Depth (SSTVD) Holocene Depth (TVD) 0 484 Casing and Liner Coring from 10726' to 10748'. Broke core. Avg background gas was 295 units with a max of 922 units. Tripped out of hole, pumping out from 10748' to 8714'. Trip out of hole from 8714' to surface. Average trip gas 51 units with a max of 412 units. Laid down core. 90' / 100% recovered. Total depth @ 24h00: 10,748'Last Survey: 10560.93'/10548.66'/8.06°/330.88° 60 Average ROP: 21.94 (While Drilling) WOB (k): 8.3 RPM (Rot/min): 69 Bit #9 8.5" FC3648 CORE Bit Daily Progress: 22' Today's date: 9/27/2012 Kelly Bushing level (KB): 196.40' Spud date: 8/22/2012 Longitude: 148° 42' 48.292 W Geologist: Paul StilesDays since spud: 36 Mud type: LSND Mud Daily Charges: DAILY GEOLOGICAL AND OPERATIONS REPORT All measurement depths (MD) are quoted per foot from rotary kelly bushing (RKB) Coordinates: WELL : Merak 1 Latitude: 69° 58' 7.368 N Report date: 9/26/2012 1355 761 520 Formation Tops From Wellsite Geologist Permafrost Formation Tops/ Markers -196 0 Ground Level: 174.7' Water (% by volume):83% Representative: Shane McGeehan, Craig Ruminer 207 Previous depth: 10,726' Tripping in hole with coring assembly Casing shoe: 13 3/8" @ 2441 ft. Casing shoe: 9 5/8" @ 8726.6 ft. Next 24 Hours Forecast (00h00 to 24h00) 12 13 133 RIG: Nabors 105 Bit#1, footage/life: 71'/29hrs ROP (min-max): 4.77 - 58.17 Flow (gpm): 247.7 Stand pipe pressure (psi): 913 2046 1788 C3 (ppm) 7261 8955 9218 51 10220 8480 9230 Top Franklin Bluffs Member (Middle Sagavanirktok) 2046 10664 7392 7392 86 808 9171 9210 691 761 5520 5892 2046 7258 64506450 131 3 555 1166 Base Franklin Bluffs Member (Middle Sagavanirktok) 1183 1850 1379 1193 372 Ground Level = 558.162 m, RKB = 567.162 m. Origin Measurement Depths (MD) per foot from RKB. 761 667 Middle Sagavanirktok Gas Shows and chromatographic analysis 10802 10555 10697 10210 33 10545Top Shublik 10477 307 119 N/A N/A 10510 Depth (ft)C2 (ppm) 8.5" 10555 10674 10674 10707 10358 10477 Total Gas (units) Report number 39 Job No.:AK-AM-0009498071 Density: 12 Daily time-slot 00:00-04:00 04:00-04:30 04:30-06:30 06:30-08:00 08:00-09:00 09:00-10:30 10:30-14:00 14:00-14:30 14:30-16:00 16:00-18:00 18:00-23:00 23:00-00:00 Comments Interval (ft) 10748'-10753.5 Max Min Interval (ft) BHA Run #Bit Type Size TFA Hours Footage WOB RPM Condition BHA #11 Bit #9 8.5 1.3 BHA #10 Bit #1 8.5 1.3 ROP Current Avg 24 hr Max Max @ Ft R.O.P. (ft/hr)N/A 3.98 Depth Ann Corr Drilling Min N/A Avg N/A Max 10748 N/A 0 All Circ Min N/A Avg N/A Max Total Gas (units) 8.5" 10555 10674 10674 10707 10358 10477 N/A N/A 10510 Depth (ft)C2 (ppm) 33 10545Top Shublik 10477 307 119 761 667 Middle Sagavanirktok Gas Shows and chromatographic analysis 10802 10555 10697 10210 Base Franklin Bluffs Member (Middle Sagavanirktok) 1183 1850 1379 1193 372 5892 2046 7258 64506450 131 3 1166 10664 7392 7392 86 808 9171 9210 555 1788 C3 (ppm) 7261 8955 9218 51 10220 8480 9230 12 13 133 RIG: Nabors 105 Bit#9, footage/life: 76'/31.3hrs ROP (min-max): 2.52-5-55 Flow (gpm): 245.2 Stand pipe pressure (psi): 912 2046 Water (% by volume):82% Representative: Shane McGeehan, Craig Ruminer 207 Previous depth: 10,748' Continue tripping out of hole. Casing shoe: 13 3/8" @ 2441 ft. Casing shoe: 9 5/8" @ 8726.6 ft. Next 24 Hours Forecast (00h00 to 24h00) Ground Level = 558.162 m, RKB = 567.162 m. Origin Measurement Depths (MD) per foot from RKB. 1355 761 520 Formation Tops From Wellsite Geologist Permafrost Formation Tops/ Markers -196 0 Top Franklin Bluffs Member (Middle Sagavanirktok) 2046 Mud type: LSND Mud Daily Charges: DAILY GEOLOGICAL AND OPERATIONS REPORT All measurement depths (MD) are quoted per foot from rotary kelly bushing (RKB) Coordinates: WELL : Merak 1 Latitude: 69° 58' 7.368 N Report date: 9/27/2012 Today's date: 9/28/2012 Kelly Bushing level (KB): 196.40' Spud date: 8/22/2012 Longitude: 148° 42' 48.292 W Geologist: Paul StilesDays since spud: 36 Ground Level: 174.7' Total depth @ 24h00: 10,753'Last Survey: 10560.93'/10548.66'/8.06°/330.88° 60 Average ROP: 3.98 WOB (k): 7.1 RPM (Rot/min): 59 Bit #9 8.5" FC3648 CORE Bit Daily Progress: 5' Casing and Liner Tripped in to hole from 6504' to 8619'. Serviced top drive and traveling blocks. Reaming, washing, and rotating down from 10210' to 10586. Worked pipe in a tight spot. Encountered packing off and sticking at 10586' but worked free. Reaming, washing and rotating down from 10586' to 10649'. Max trip gas encountered: 4246 units. Circulate and condition. Drop ball. Establish parameters. Tripping out of hole from 8727' to 8331'. Attempted to core from 10649' to 10753.5' Avg background gas: 223 units. Max: 257 units. No fluid losses down hole. 1379 Zone Thickness Trip out. Inspect core barrel. Trip in to core next section. 484 Depth (SSTVD) Holocene Depth (TVD) 0 484 9903 9222 9235 5520 5892 9218 9180 9171 7261 9210 8477 9180 8480 2566 484 691 7258 691 761 5520 Summary lithological description and remarks 558 2046 2566 3732 9285 9048 9294 3732 2370 C1 (ppm) LCU (Lower Cretaceous Unconformity) Base HRZ Pebble Shale 9531 9098 373 9716 9540 Gas type & remarks N/A 9344 10812 335 10664 10023 iC5 & nC5 (ppm) Trip Gas @ 10636' tripping in. 9913 9023 Campanian Flooding Surface Upper Schrader Bluff Lower Sagavanirktok Lower Canning 8280 7065 3.173 iC4 & nC4 (ppm) 8477 7062 1850 3536 5324 5696 6254 246 Tripped in hole from 8619' to 10210' Flow In (spm) N/A Gallons/stroke Lower Kingak TD PWD Kuparauk A Miluveach Upper Kingak Summary Operations Depth KB (MD) Gublik Current Operations Status (00h00 to 04h00) Formation Tops in Red Surface Tops in Blue Undetermined Tops in Black 10740'-10748' Kuparauk C Circulated and conditioned. Circulated a btm's up at 10586'. 288 495 565 No petro fluor. Shale: Medium-dark gry, firm silty shale, with occasional traces of pyrite. Coupled with gray to cream white, fossiliferous wackestone. 9243 8751 Hole Condition On Bot Hrs Avg Diam Top HRZ (Higly Radioactive Zone) 7196 Middle Schrader Bluff Depth In Formation 0 Shublik 4246 0 Direct fluorescence comment Cut fluorescence comment 3881 0 1114 51-39113-20328738 Depth Out 00 10660FG3648 FC3747 31.3 26 1066010611 5.55 10752 No cut. No stain. Flow In (gpm) 0 10753.4 59.000 2.330 N/A SPP (psi) N/A 7.1 10.7 Current Pump & Flow Data 0 93.4 49 Ivishak Base Shublik Fire Creek Kuparauk B Mikkelson Tongue (Upper Canning) Lower Canning MCU (Mid Campanian Unconformity) Hue Shale Prince Creek Observed plugged barrel. Lower Kingak (K-1 Top) Lower Kingak Base 8975 8948 Staines Tongue (Lower Sagavanirktok) 9023 9035 8280 8975 Total Charges: Chlorides (mg/l): 28000 Hardness (mg/l): 10615 10358 10545 Back reaming and pumping out of hole from 10753' to shoe. Report number 40 Job No.:AK-AM-0009498071 Density: 12 Daily time-slot 00:00-06:00 06:00-09:00 09:00-15:30 15:30-16:00 16:00-17:30 17:30-24:00 Comments Interval (ft) 10748'-10753.5 Max Min Interval (ft) BHA Run #Bit Type Size TFA Hours Footage WOB RPM Condition BHA #13 Bit #9 8.5 1.3 BHA #12 Bit #9 8.5 1.3 ROP Current Avg 24 hr Max Max @ Ft R.O.P. (ft/hr)N/A N/A Depth Ann Corr Drilling Min N/A Avg N/A Max 10748 N/A 0 All Circ Min N/A Avg N/A Max Total Charges: Chlorides (mg/l): 28000 Hardness (mg/l): 10615 10358 10545 Lower Kingak (K-1 Top) Lower Kingak Base 8975 8948 Staines Tongue (Lower Sagavanirktok) 9023 9035 8280 8975 Ivishak Base Shublik Fire Creek Kuparauk B Mikkelson Tongue (Upper Canning) Lower Canning MCU (Mid Campanian Unconformity) Hue Shale Prince Creek 243 SPP (psi) N/A N/A 7.1 Current Pump & Flow Data 0 0 5.4 N/A N/A No cut. No stain. Flow In (gpm) 0 10753.4 N/A 59.000 FC3747 FC3747 0 26 10753.410748 Depth Out 00 10753.4 643 0 Direct fluorescence comment Cut fluorescence comment 7179 0 2202 76-59182-38360141 Hole Condition On Bot Hrs Avg Diam Top HRZ (Higly Radioactive Zone) 7196 Middle Schrader Bluff Depth In Formation 0 Shublik 10740'-10748' Kuparauk C Reaming and washing from 9797' to 10561'. Average gas was 209 units with a max of 643 units. 288 495 565 No petro fluor. Shale: Medium-dark gry, firm silty shale, with occasional traces of pyrite. Coupled with gray to cream white, fossiliferous wackestone. 9243 8751 PWD Kuparauk A Miluveach Upper Kingak Summary Operations Depth KB (MD) Gublik Current Operations Status (00h00 to 04h00) Formation Tops in Red Surface Tops in Blue Undetermined Tops in Black Tripped in hole from surface to 8727'. Average gas was 33 units with a max of 107 units. Flow In (spm) N/A Gallons/stroke Lower Kingak TD 3.173 iC4 & nC4 (ppm) 8477 7062 1850 3536 5324 5696 6254 246 Campanian Flooding Surface Upper Schrader Bluff Lower Sagavanirktok Lower Canning 8280 7065 Gas type & remarks N/A 9344 10812 335 10664 10023 iC5 & nC5 (ppm) Trip Gas @ 10355' tripping in. 9913 C1 (ppm) LCU (Lower Cretaceous Unconformity) Base HRZ Pebble Shale 9531 9098 373 9716 9540 558 2046 2566 3732 9285 9048 9294 3732 2370 9023 2566 484 691 7258 691 761 5520 9222 9235 5520 5892 9218 9180 9171 7261 9210 8477 No fluid losses down hole. 1379 Zone Thickness Trip to bottom and core next section. 484 Depth (SSTVD) Holocene Depth (TVD) 0 484 Casing and Liner Tripped out of hole from 8331' to surface'. Average trip gas was 6 units with a max of 78 units. Laid down tools and inner core barrels. Changed out core bit. Picked up tools and inner core barrels. Rig service: Crown, blocks and top drive. Tripped in hole from 8727' to 9797'. Average gas was 6 units with a max of 19 units. 60 Average ROP: N/A WOB (k): N/A RPM (Rot/min): 27 Bit #9 8.5" FC3648 CORE Bit Daily Progress: 0' Geologist: Paul StilesDays since spud: 38 Ground Level: 174.7' Total depth @ 24h00: 10,753'Last Survey: 10560.93'/10548.66'/8.06°/330.88° DAILY GEOLOGICAL AND OPERATIONS REPORT All measurement depths (MD) are quoted per foot from rotary kelly bushing (RKB) Coordinates: WELL : Merak 1 Latitude: 69° 58' 7.368 N Report date: 9/28/2012 Today's date: 9/29/2012 Kelly Bushing level (KB): 196.40' 1355 761 520 Formation Tops From Wellsite Geologist Permafrost Formation Tops/ Markers -196 0 Top Franklin Bluffs Member (Middle Sagavanirktok) 2046 Representative: Shane McGeehan, Craig Ruminer 207 Previous depth: 10,753' Encountered packing off issues at 10614' just after midnight. Still having difficult reaching bottom. Casing shoe: 13 3/8" @ 2441 ft. Casing shoe: 9 5/8" @ 8726.6 ft. Next 24 Hours Forecast (00h00 to 24h00) Ground Level = 558.162 m, RKB = 567.162 m. Origin Measurement Depths (MD) per foot from RKB. Mud type: LSND Mud Daily Charges: Spud date: 8/22/2012 RIG: Nabors 105 Bit#9, footage/life: 76'/31.3hrs ROP (min-max): N/A Flow (gpm): 243 Stand pipe pressure (psi): 727 2046 Water (% by volume):82% Longitude: 148° 42' 48.292 W 8480 9230 12 13 1339180 8480 9171 9210 555 1788 7261 8955 9218 51 6450 131 3 1166 10664 7392 7392 86 808 Base Franklin Bluffs Member (Middle Sagavanirktok) 1183 1850 1379 1193 372 5892 2046 7258 6450 761 667 Middle Sagavanirktok Gas Shows and chromatographic analysis 10802 10555 10697 10210 33 10545Top Shublik 10477 307 119 10220 9903 N/A N/A 10510 Depth (ft)C2 (ppm)Total Gas (units) 8.5" 10555 10674 10674 10707 10358 10477 C3 (ppm) Summary lithological description and remarks Report number 41 Job No.:AK-AM-0009498071 Density: 12.2 Daily time-slot 00:00-04:00 04:00-07:30 07:30-12:30 12:30-18:30 18:30-20:30 20:30-23:30 23:30-00:00 Comments Interval (ft) 10753.5'-10843.8' Max Min Interval (ft) BHA Run #Bit Type Size TFA Hours Footage WOB RPM Condition BHA #13 Bit #9 8.5 1.3 BHA #12 Bit #9 8.5 1.3 ROP Current Avg 24 hr Max Max @ Ft R.O.P. (ft/hr)N/A 25.5 Depth Ann Corr Drilling Min N/A Avg N/A Max 10843 4.1 0 All Circ Min N/A Avg N/A Max Total Charges: Chlorides (mg/l): 28000 Hardness (mg/l): 10615 10358 10545 Lower Kingak (K-1 Top) Lower Kingak Base 8975 8948 Staines Tongue (Lower Sagavanirktok) 9023 9035 8280 8975 Ivishak Base Shublik Fire Creek Kuparauk B Mikkelson Tongue (Upper Canning) Lower Canning MCU (Mid Campanian Unconformity) Hue Shale Prince Creek Campanian Flooding Surface N/A SPP (psi) N/A N/A 7.1 Current Pump & Flow Data 0 89.78 5.4 45.1 10805' No cut. No stain. Flow In (gpm) 0 10843.18 N/A 59.000 FC3747 FC3747 4.1 26 10753.410748 Depth Out 00 10753.4 703 0 Direct fluorescence comment Cut fluorescence comment 7473 0 1710 85-45200-27454243 Hole Condition On Bot Hrs Avg Diam Top HRZ (Higly Radioactive Zone) 7196 Middle Schrader Bluff Depth In Formation 0 Shublik 10753.5'-10843.8' Kuparauk C Pumping out of hole. 288 495 565 No petro fluor. Limestone: Creamy gray in color, occasions of brown-gray, firm to brittle, traces of shale and pyrite, with scattered sandstone towards bottom of interval. 9243 8751 PWD Kuparauk A Miluveach Upper Kingak Summary Operations Depth KB (MD) Gublik Current Operations Status (00h00 to 04h00) Formation Tops in Red Surface Tops in Blue Undetermined Tops in Black Cored from 10751' to 10843'. Background gas was 249 units with a max of 703 units. Flow In (spm) N/A Gallons/stroke Lower Kingak TD 3.173 iC4 & nC4 (ppm) 8477 7062 1850 3536 5324 5696 6254 246 Upper Schrader Bluff Lower Sagavanirktok Lower Canning 8280 7065 Gas type & remarksC1 (ppm) LCU (Lower Cretaceous Unconformity) Base HRZ Pebble Shale 10,801 9344 10812 335 10664 10023 iC5 & nC5 (ppm) coring 9913 9531 9098 373 9716 9540 558 9222 9235 9218 9180 2046 2566 3732 9285 9048 9294 3732 2370 9023 2566 484 691 7258 691 761 5520 5520 5892 6450 761 9171 7261 9210 8477 No fluid losses down hole. 1379 Zone Thickness 484 1355 761 Trip out to surface. Recover core. BOP test. Trip in for next core section. 484 Depth (SSTVD) Holocene Depth (TVD) 0 Casing and Liner Tripped in hole and tagged fill at 10612'. Avg background gas was 359 units with a max of 1513 units. Tripped into hole from 10612' to 10751', washing and reaming. Avg background gas was 249 units with a max of 827 units. Pulled out of hole, back reaming when needed. Got stuck at the shoe and observed 20k overpull. Pumped a high visc. Sweep. Rotated and reciprocated pipe and pulled into shoe without overpull. Pulled out without pumping. 60 Average ROP: 25.54 WOB (k): 10.1 RPM (Rot/min): 69 Bit #9 8.5" FC3648 CORE Bit Daily Progress: 90'Total depth @ 24h00: 10,843'Last Survey: 10560.93'/10548.66'/8.06°/330.88° Representative: Shane McGeehan, Craig Ruminer Previous depth: 10,753' Spud date: 8/22/2012 DAILY GEOLOGICAL AND OPERATIONS REPORT All measurement depths (MD) are quoted per foot from rotary kelly bushing (RKB) Coordinates: WELL : Merak 1 Latitude: 69° 58' 7.368 N Report date: 9/29/2012 Today's date: 9/30/2012 Kelly Bushing level (KB): 196.40' 520 Formation Tops From Wellsite Geologist Permafrost Formation Tops/ Markers -196 0 Top Franklin Bluffs Member (Middle Sagavanirktok) 2046 207 Base Franklin Bluffs Member (Middle Sagavanirktok) Longitude: 148° 42' 48.292 W Trip out of hole. Gas was minimal. Casing shoe: 13 3/8" @ 2441 ft. Casing shoe: 9 5/8" @ 8726.6 ft. Next 24 Hours Forecast (00h00 to 24h00) Ground Level = 558.162 m, RKB = 567.162 m. Origin Measurement Depths (MD) per foot from RKB. Mud type: LSND Mud Daily Charges: Geologist: Paul StilesDays since spud: 39 Ground Level: 174.7' 8480 RIG: Nabors 105 Bit#9, footage/life: 89.42'/4.1hrs ROP (min-max): 2.11-45.12 Flow (gpm): 245 Stand pipe pressure (psi): 885 2046 Water (% by volume):81% 9230 12 13 1339180 9210 555 1788 7261 8955 9218 51 8480 131 3 1166 10664 7392 7392 86 808 9171 1183 1850 1379 1193 372 5892 2046 7258 6450 667 Middle Sagavanirktok Gas Shows and chromatographic analysis 10802 10555 10697 10210 33 10545Top Shublik 10477 307 119 10220 9903 N/A N/A 10510 Depth (ft)C2 (ppm)Total Gas (units) 8.5" 10555 10674 10674 10707 10358 10477 C3 (ppm) Summary lithological description and remarks Report number 42 Job No.:AK-AM-0009498071 Density: 12.2 Daily time-slot 00:00-08:30 08:30-10:30 10:30-12:00 12:00-22:00 22:00-23:00 23:00-00:00 Comments Interval (ft) 10753.5'-10843.8' Max Min Interval (ft) BHA Run #Bit Type Size TFA Hours Footage WOB RPM Condition BHA #13 Bit #9 8.5 1.3 BHA #12 Bit #9 8.5 1.3 ROP Current Avg 24 hr Max Max @ Ft R.O.P. (ft/hr)N/A 25.5 Depth Ann Corr Drilling Min N/A Avg N/A Max 10843 4.1 0 All Circ Min N/A Avg N/A Max Total Gas (units) 8.5" 10555 10674 10674 10707 10358 10477 C3 (ppm) Summary lithological description and remarks N/A N/A 10510 Depth (ft)C2 (ppm) Top Shublik 10477 307 119 10220 9903 Middle Sagavanirktok Gas Shows and chromatographic analysis 10802 10555 10697 10210 33 10545 1183 1850 1379 1193 372 5892 2046 7258 6450 667 131 3 1166 10664 7392 7392 86 808 9171 9210 555 1788 7261 8955 9218 51 8480 9230 12 13 1339180 8480 RIG: Nabors 105 Bit#9, footage/life: 89.42'/4.1hrs ROP (min-max): N/A Flow (gpm): 0 Stand pipe pressure (psi): 0 2046 Water (% by volume):81% Longitude: 148° 42' 48.292 W BOP Repair. Casing shoe: 13 3/8" @ 2441 ft. Casing shoe: 9 5/8" @ 8726.6 ft. Next 24 Hours Forecast (00h00 to 24h00) Ground Level = 558.162 m, RKB = 567.162 m. Origin Measurement Depths (MD) per foot from RKB. Mud type: LSND Mud Daily Charges: Geologist: Paul StilesDays since spud: 39 Ground Level: 174.7' 520 Formation Tops From Wellsite Geologist Permafrost Formation Tops/ Markers -196 0 Top Franklin Bluffs Member (Middle Sagavanirktok) 2046 207 Base Franklin Bluffs Member (Middle Sagavanirktok) DAILY GEOLOGICAL AND OPERATIONS REPORT All measurement depths (MD) are quoted per foot from rotary kelly bushing (RKB) Coordinates: WELL : Merak 1 Latitude: 69° 58' 7.368 N Report date: 9/30/2012 Today's date: 10/01/2012 Kelly Bushing level (KB): 196.40' Last Survey: 10560.93'/10548.66'/8.06°/330.88° Representative: Shane McGeehan, Craig Ruminer Previous depth: 10,843' Spud date: 8/22/2012 60 Average ROP: 25.54 WOB (k): 0 RPM (Rot/min): 0 Bit #9 8.5" FC3648 CORE Bit Daily Progress: 0'Total depth @ 24h00: 10,843' Casing and Liner Trip out of hole pull f/ 7180 to 3000' and reduce pulling rate according to core pulling schedule. Continue pulling out of hole. Stand back all drill pipe. Trip out of hole LD inner core barrels. Set back outer barrels. Test BOPS Test Annular preventer 250/3500 PSI. Test all other BOPE equipment 250/5000 PSI. Upper IBOP failure. Test BOPS blow down choke and kill lines. Pull test plug. Change out upper IBOP. Attempted to test - no test. RIIH With Core Barrel 484 Depth (SSTVD) Holocene Depth (TVD) 0 9171 7261 9210 8477 No fluid losses down hole. 1379 Zone Thickness 484 1355 761 484 691 7258 691 761 5520 5520 5892 6450 761 2046 2566 3732 9285 9048 9294 3732 2370 9023 2566 9098 373 9716 9540 558 9222 9235 9218 9180 N/A 9344 10812 335 10664 10023 iC5 & nC5 (ppm) 9913 9531 Upper Schrader Bluff Lower Sagavanirktok Lower Canning 8280 7065 Gas type & remarksC1 (ppm) LCU (Lower Cretaceous Unconformity) Base HRZ Pebble Shale 3.173 iC4 & nC4 (ppm) 8477 7062 1850 3536 5324 5696 6254 246 PU Test tools BOLDS and pull wear ring. RIH with test plug and RU test assembly. Flow In (spm) N/A Gallons/stroke Lower Kingak TD PWD Kuparauk A Miluveach Upper Kingak Summary Operations Depth KB (MD) Gublik Current Operations Status (00h00 to 04h00) Formation Tops in Red Surface Tops in Blue Undetermined Tops in Black 10753.5'-10843.8' Kuparauk C Downtime-BOP - Choke - IBOP Leaks. Change out IBOP. 288 495 565 No petro fluor. Limestone: Creamy gray in color, occasions of brown-gray, firm to brittle, traces of shale and pyrite, with scattered sandstone towards bottom of interval. 9243 8751 Hole Condition On Bot Hrs Avg Diam Top HRZ (Higly Radioactive Zone) 7196 Middle Schrader Bluff Depth In Formation 0 Shublik 0 0 Direct fluorescence comment Cut fluorescence comment 0 0 0 000 Depth Out N/A0 10753.4FC3747 FC3747 4.1 26 10753.410748 45.1 10805' No cut. No stain. Flow In (gpm) 0 10843.18 N/A 59.000 N/A SPP (psi) N/A N/A 7.1 Current Pump & Flow Data 0 89.78 5.4 Ivishak Base Shublik Fire Creek Kuparauk B Mikkelson Tongue (Upper Canning) Lower Canning MCU (Mid Campanian Unconformity) Hue Shale Prince Creek Campanian Flooding Surface Lower Kingak (K-1 Top) Lower Kingak Base 8975 8948 Staines Tongue (Lower Sagavanirktok) 9023 9035 8280 8975 Total Charges: Chlorides (mg/l): 28000 Hardness (mg/l): 10615 10358 10545 Report number 43 Job No.:AK-AM-0009498071 Density: 12.2 Daily time-slot 00:00-04:30 4:30-5:30 5:30-7:30 7:30-11:00 11:00-12:00 12:00-17:30 17:30-19:00 19:00-20:00 20:00-00:00 Comments Interval (ft) 10753.5'-10843.8' Max Min Interval (ft) BHA Run #Bit Type Size TFA Hours Footage WOB RPM Condition BHA #13 Bit #9 8.5 1.3 BHA #12 Bit #9 8.5 1.3 ROP Current Avg 24 hr Max Max @ Ft R.O.P. (ft/hr)N/A N/A Depth Ann Corr Drilling Min N/A Avg N/A Max 10843 0 0 All Circ Min N/A Avg N/A Max Total Charges: Chlorides (mg/l): 28000 Hardness (mg/l): 10615 10358 10545 Lower Kingak (K-1 Top) Lower Kingak Base 8975 8948 Staines Tongue (Lower Sagavanirktok) 9023 9035 8280 8975 Ivishak Base Shublik Fire Creek Kuparauk B Mikkelson Tongue (Upper Canning) Lower Canning MCU (Mid Campanian Unconformity) Hue Shale Prince Creek Campanian Flooding Surface 200 SPP (psi) N/A N/A 7.1 Current Pump & Flow Data 0 89.78 5.4 N/A N/A No cut. No stain. Flow In (gpm) 0 10843.18 N/A 59.000 FC3747 FC3747 4.1 26 10753.410748 Depth Out N/A0 10753.4 640 0 Direct fluorescence comment Cut fluorescence comment 3632 0 1282 9940459039 Hole Condition On Bot Hrs Avg Diam Top HRZ (Higly Radioactive Zone) 7196 Middle Schrader Bluff Depth In Formation 0 Shublik 10753.5'-10843.8' Kuparauk C Trip in hole F/ 1,751 T/ 8,727' Filling every 2000'. L/D Single of DP 288 495 565 No petro fluor. Limestone: Creamy gray in color, occasions of brown-gray, firm to brittle, traces of shale and pyrite, with scattered sandstone towards bottom of interval. 9243 8751 PWD Kuparauk A Miluveach Upper Kingak Summary Operations Depth KB (MD) Gublik Current Operations Status (00h00 to 04h00) Formation Tops in Red Surface Tops in Blue Undetermined Tops in Black Lay down BHA L/D 6.75 outer tube barrel Flow In (spm) N/A Gallons/stroke Lower Kingak TD 3.173 iC4 & nC4 (ppm) 8477 7062 1850 3536 5324 5696 6254 246 Upper Schrader Bluff Lower Sagavanirktok Lower Canning 8280 7065 Gas type & remarksC1 (ppm) LCU (Lower Cretaceous Unconformity) Base HRZ Pebble Shale 10,844 9344 10812 335 10664 10023 iC5 & nC5 (ppm) 9913 9531 9098 373 9716 9540 558 9222 9235 9218 9180 2046 2566 3732 9285 9048 9294 3732 2370 9023 2566 484 691 7258 691 761 5520 5520 5892 6450 761 9171 7261 9210 8477 No fluid losses down hole. 1379 Zone Thickness 484 1355 761 Core 484 Depth (SSTVD) Holocene Depth (TVD) 0 Casing and Liner Downtime BOP Choke Replace Upper IBOP Test upper IBOP 5000 PSI High, 250 PSI low 5 min Install / Remove wear bushing and break down test joint Pick up BHA Change out handling equipment. PU outer 4.75 barrel BHA and insert inner barrel. RIH with HWDP. Trip in hole with 9 Stands of drill pipe Cut Drilling line cut and slip 92' of drill line Trip in hole P/U space out pups. TIH T/ 9147' MD Reaming / Washing Wash Down F/ 9,147' T/ -----' 46 SPM 150 GPM; 450 PSI, 2k Free, 20 RPM 60 Average ROP: N/A WOB (k): 0 RPM (Rot/min): 0 Bit #9 8.5" FC3648 CORE Bit Daily Progress: 0'Total depth @ 24h00: 10,843'Last Survey: 10560.93'/10548.66'/8.06°/330.88° Representative: Shane McGeehan, Jay Murphy Previous depth: 10,843' Spud date: 8/22/2012 DAILY GEOLOGICAL AND OPERATIONS REPORT All measurement depths (MD) are quoted per foot from rotary kelly bushing (RKB) Coordinates: WELL : Merak 1 Latitude: 69° 58' 7.368 N Report date: 9/30/2012 Today's date: 10/02/2012 Kelly Bushing level (KB): 196.40' 520 Formation Tops From Wellsite Geologist Permafrost Formation Tops/ Markers -196 0 Top Franklin Bluffs Member (Middle Sagavanirktok) 2046 207 Base Franklin Bluffs Member (Middle Sagavanirktok) Longitude: 148° 42' 48.292 W RIIH With Core Barrel Casing shoe: 13 3/8" @ 2441 ft. Casing shoe: 9 5/8" @ 8726.6 ft. Next 24 Hours Forecast (00h00 to 24h00) Ground Level = 558.162 m, RKB = 567.162 m. Origin Measurement Depths (MD) per foot from RKB. Mud type: LSND Mud Daily Charges: Geologist: Paul StilesDays since spud: 40 Ground Level: 174.7' 8480 RIG: Nabors 105 Bit#9, footage/life: 89.42'/4.1hrs ROP (min-max): N/A Flow (gpm): 200 Stand pipe pressure (psi): 0 2046 Water (% by volume):81% 9230 12 13 1339180 9210 555 1788 7261 8955 9218 51 8480 131 3 1166 10664 7392 7392 86 808 9171 1183 1850 1379 1193 372 5892 2046 7258 6450 667 Middle Sagavanirktok Gas Shows and chromatographic analysis 10802 10555 10697 10210 33 10545Top Shublik 10477 307 119 10220 9903 N/A N/A 10510 Depth (ft)C2 (ppm)Total Gas (units) 8.5" 10555 10674 10674 10707 10358 10477 C3 (ppm) Summary lithological description and remarks Report number 44 Job No.:AK-AM-0009498071 Density: 12.2 Daily time-slot 00:00-05:00 05:00-12:00 12:00-20:30 20:30-00:00 Comments Interval (ft) 10843-10933 Max Min Interval (ft) BHA Run #Bit Type Size TFA Hours Footage WOB RPM Condition BHA #13 Bit #9 8.5 1.3 BHA #14 Bit #9 8.5 1.3 ROP Current Avg 24 hr Max Max @ Ft R.O.P. (ft/hr)N/A N/A Depth Ann Corr Drilling Min N/A Avg N/A Max 10933 0 0 All Circ Min N/A Avg N/A Max Total Gas (units) 8.5" 10555 10674 10674 10707 10358 10477 C3 (ppm) Summary lithological description and remarks N/A N/A 10510 Depth (ft)C2 (ppm) Top Shublik 10477 307 119 10220 9903 Middle Sagavanirktok Gas Shows and chromatographic analysis 10802 10555 10697 10210 33 10545 1183 1850 1379 1193 372 5892 2046 7258 6450 667 131 3 1166 10664 7392 7392 86 808 9171 9210 555 1788 7261 8955 9218 51 8480 9230 12 13 1339180 8480 RIG: Nabors 105 Bit#9, footage/life: 89.42'/5.3hrs ROP (min-max): 0-26.64 Flow (gpm): 0 Stand pipe pressure (psi): 0 2046 Water (% by volume):81% Longitude: 148° 42' 48.292 W Trip Out with Core Barrel Casing shoe: 13 3/8" @ 2441 ft. Casing shoe: 9 5/8" @ 8726.6 ft. Next 24 Hours Forecast (00h00 to 24h00) Ground Level = 558.162 m, RKB = 567.162 m. Origin Measurement Depths (MD) per foot from RKB. Mud type: LSND Mud Daily Charges: Geologist: Paul StilesDays since spud: 40 Ground Level: 174.7' 520 Formation Tops From Wellsite Geologist Permafrost Formation Tops/ Markers -196 0 Top Franklin Bluffs Member (Middle Sagavanirktok) 2046 207 Base Franklin Bluffs Member (Middle Sagavanirktok) DAILY GEOLOGICAL AND OPERATIONS REPORT All measurement depths (MD) are quoted per foot from rotary kelly bushing (RKB) Coordinates: WELL : Merak 1 Latitude: 69° 58' 7.368 N Report date: 10/02/2012 Today's date: 10/03/2012 Kelly Bushing level (KB): 196.40' Last Survey: 10560.93'/10548.66'/8.06°/330.88° Representative: Shane McGeehan, Jay Murphy Previous depth: 10,843' Spud date: 8/22/2012 60 Average ROP: 10.56 WOB (k): 0 RPM (Rot/min): 0 Bit #9 8.5" FC3648 CORE Bit Daily Progress: 90'Total depth @ 24h00: 10,933' Casing and Liner Trip in hole wash down and ream. 150 gpm at 600 psi. 48 rpm at 4 k tq. Work and rotate through tight spot. Pump sweep when free. Problem issue suspected farther up hole. Trip in hole RIH 50 RPM, 150 GPM. 10,615 and tag fill. Back ream F/ 10933 T/ 9900 Pickup next drilling assembly 484 Depth (SSTVD) Holocene Depth (TVD) 0 9171 7261 9210 8477 No fluid losses down hole. 1379 Zone Thickness 484 1355 761 484 691 7258 691 761 5520 5520 5892 6450 761 2046 2566 3732 9285 9048 9294 3732 2370 9023 2566 9098 373 9716 9540 558 9222 9235 9218 9180 10,933 9344 10812 335 10664 10023 iC5 & nC5 (ppm) 9913 9531 Upper Schrader Bluff Lower Sagavanirktok Lower Canning 8280 7065 Gas type & remarksC1 (ppm) LCU (Lower Cretaceous Unconformity) Base HRZ Pebble Shale 3.173 iC4 & nC4 (ppm) 8477 7062 1850 3536 5324 5696 6254 246 Coring drop core ball. Establish parameters. Core from 10,843' MD to 10,933' MD. Flow In (spm) 0 Gallons/stroke Lower Kingak TD PWD Kuparauk A Miluveach Upper Kingak Summary Operations Depth KB (MD) Gublik Current Operations Status (00h00 to 04h00) Formation Tops in Red Surface Tops in Blue Undetermined Tops in Black 10870-10880 Kuparauk C 288 495 565 Lt sptty brt orange petro fluorescence Shale. Dark grey - black, firm with up to 1 inch by 0.1 inch elongate cuttings. Some interbedded v f sandstone - silt and tuff. 9243 8751 Hole Condition On Bot Hrs Avg Diam Top HRZ (Higly Radioactive Zone) 7196 Middle Schrader Bluff Depth In Formation 5965 Base Shublik 520 62 Direct fluorescence comment Cut fluorescence comment 2093 791 636 7212314195 Depth Out 108490 10753.4 Dull lt blue fluorescence FC3747 FC3747 4.1 5 1093310843 N/A N/A Dull light blue fluorescence, Immediate streaming light yellow cut fluor, Star cut residue Slow streaming light yellow cut fluor, v lt straw cut residue Flow In (gpm) 226 10843.18 42.000 59.000 0 SPP (psi) 0 5 7.1 Current Pump & Flow Data 23 89.78 90 Ivishak Base Shublik Fire Creek Kuparauk B Mikkelson Tongue (Upper Canning) Lower Canning MCU (Mid Campanian Unconformity) Hue Shale Prince Creek Campanian Flooding Surface Lower Kingak (K-1 Top) Lower Kingak Base 8975 8948 Staines Tongue (Lower Sagavanirktok) 9023 9035 8280 8975 10920-10930 Total Charges: Chlorides (mg/l): 28000 Hardness (mg/l): 10615 10358 10545 Report number 45 Job No.:AK-AM-0009498071 Density: 12.2 Daily time-slot 00:00-03:00 03:00-4:30 4:30-10:30 10:30-12:00 12:00-15:00 15:00-20:00 20:00-00:00 Comments Interval (ft) 10933 Max Min Interval (ft) BHA Run #Bit Type Size TFA Hours Footage WOB RPM Condition BHA #15 Bit #10 8.5 0.8629 BHA #14 Bit #9 8.5 1.3 ROP Current Avg 24 hr Max Max @ Ft R.O.P. (ft/hr)N/A N/A Depth Ann Corr Drilling Min N/A Avg N/A Max 10933 0 0 All Circ Min N/A Avg N/A Max 10920-10930 Total Charges: Chlorides (mg/l): 28000 Hardness (mg/l): 10615 10358 10545 Lower Kingak (K-1 Top) Lower Kingak Base 8975 8948 Staines Tongue (Lower Sagavanirktok) 9023 9035 8280 8975 Ivishak Base Shublik Fire Creek Kuparauk B Mikkelson Tongue (Upper Canning) Lower Canning MCU (Mid Campanian Unconformity) Hue Shale Prince Creek Campanian Flooding Surface 365 SPP (psi) 1622 0 7.1 Current Pump & Flow Data 0 90 N/A N/A Dull light blue fluorescence, Immediate streaming light yellow cut fluor, Star cut residue Slow streaming light yellow cut fluor, v lt straw cut residue Flow In (gpm) 10933 0.000 59.000 HDBS FX56 FC3747 0 5 1093310843 Depth Out 10933 Dull lt blue fluorescence NEW 582 0 Direct fluorescence comment Cut fluorescence comment Hole Condition On Bot Hrs Avg Diam Top HRZ (Higly Radioactive Zone) 7196 Middle Schrader Bluff Depth In Formation Ivishak 10870-10880 Kuparauk C Pick up BHA 288 495 565 Lt sptty brt orange petro fluorescence Sandstone. White f-vf, sb-elg - sb-sph, w srt, pred qrtz, slt calc. 9243 8751 PWD Kuparauk A Miluveach Upper Kingak Summary Operations Depth KB (MD) Gublik Current Operations Status (00h00 to 04h00) Formation Tops in Red Surface Tops in Blue Undetermined Tops in Black Trip out of hole on elevators from shoe. Flow In (spm) 130 Gallons/stroke Lower Kingak TD 3.173 iC4 & nC4 (ppm) 8477 7062 1850 3536 5324 5696 6254 246 Upper Schrader Bluff Lower Sagavanirktok Lower Canning 8280 7065 Gas type & remarksC1 (ppm) LCU (Lower Cretaceous Unconformity) Base HRZ Pebble Shale 9344 10812 335 10664 10023 iC5 & nC5 (ppm) 9913 9531 9098 373 9716 9540 558 9222 9235 9218 9180 2046 2566 3732 9285 9048 9294 3732 2370 9023 2566 484 691 7258 691 761 5520 5520 5892 6450 761 9171 7261 9210 8477 No fluid losses down hole. 1379 Zone Thickness 484 1355 761 Drill ahead 484 Depth (SSTVD) Holocene Depth (TVD) 0 Casing and Liner Back reaming out of hole to shoe at 8727' MD. Pump sweep to clean out shoe. Circulate and condition circulate sweep to surface. Pump dry job and blow down top drive. Trip out of hole stand back jars and HWDP Lay down tools Trip in hole 60 Average ROP: 0 WOB (k): 0 RPM (Rot/min): 65 Bit #10 HDBS FX56 Daily Progress: 0'Total depth @ 24h00: 10,933'Last Survey: 10560.93'/10548.66'/8.06°/330.88° Representative: Shane McGeehan, Jay Murphy Previous depth: 10,933' Spud date: 8/22/2012 DAILY GEOLOGICAL AND OPERATIONS REPORT All measurement depths (MD) are quoted per foot from rotary kelly bushing (RKB) Coordinates: WELL : Merak 1 Latitude: 69° 58' 7.368 N Report date: 10/03/2012 Today's date: 10/04/2012 Kelly Bushing level (KB): 196.40' 520 Formation Tops From Wellsite Geologist Permafrost Formation Tops/ Markers -196 0 Top Franklin Bluffs Member (Middle Sagavanirktok) 2046 207 Base Franklin Bluffs Member (Middle Sagavanirktok) Longitude: 148° 42' 48.292 W Trip in hole with quad combo drilling assembly Casing shoe: 13 3/8" @ 2441 ft. Casing shoe: 9 5/8" @ 8726.6 ft. Next 24 Hours Forecast (00h00 to 24h00) Ground Level = 558.162 m, RKB = 567.162 m. Origin Measurement Depths (MD) per foot from RKB. Mud type: LSND Mud Daily Charges: Geologist: Paul StilesDays since spud: 40 Ground Level: 174.7' 8480 RIG: Nabors 105 Bit#10, footage/life: 0'/0hrs ROP (min-max): 0 Flow (gpm): 381 Stand pipe pressure (psi): 1750 2046 Water (% by volume):81% 9230 12 13 1339180 9210 555 1788 7261 8955 9218 51 8480 131 3 1166 10664 7392 7392 86 808 9171 1183 1850 1379 1193 372 5892 2046 7258 6450 667 Middle Sagavanirktok Gas Shows and chromatographic analysis 10802 10555 10697 10210 33 10545Top Shublik 10477 307 119 10220 9903 N/A N/A 10510 Depth (ft)C2 (ppm)Total Gas (units) 8.5" 10555 10674 10674 10707 10358 10477 C3 (ppm) Summary lithological description and remarks Report number 46 Job No.:AK-AM-0009498071 Density: 12.2 Daily time-slot 00:00-03:00 03:00-03:30 03:30-05:00 05:00-12:00 12:00-23:30 23:30-00:00 Comments Interval (ft) 10933 Max Min Interval (ft) BHA Run #Bit Type Size TFA Hours Footage WOB RPM Condition BHA #15 Bit #10 8.5 0.8629 BHA #14 Bit #9 8.5 1.3 ROP Current Avg 24 hr Max Max @ Ft R.O.P. (ft/hr)47 11 Depth Ann Corr Drilling Min N/A Avg N/A Max 10933 0 0 All Circ Min 12.77 Avg 13.23 Max Total Gas (units) 8.5" 10727 10674 10674 10707 10518 10477 C3 (ppm) Summary lithological description and remarks N/A 0.01 10510 Depth (ft)C2 (ppm) Top Shublik 10477 343 119 10357 10102 Middle Sagavanirktok Gas Shows and chromatographic analysis 10802 10727 10697 10346 33 10714 1183 1850 1379 1193 372 5892 2046 7258 6450 667 131 3 1166 10664 7392 7392 86 808 9171 9388 555 1788 7261 8955 9398 77 8480 9405 7 12 2189180 8480 RIG: Nabors 105 Bit#10, footage/life: 0'/0hrs ROP (min-max): 0 Flow (gpm): 450 Stand pipe pressure (psi): 2400 2046 Water (% by volume):81% Longitude: 148° 42' 48.292 W Drilling Casing shoe: 13 3/8" @ 2441 ft. Casing shoe: 9 5/8" @ 8726.6 ft. Next 24 Hours Forecast (00h00 to 24h00) Ground Level = 558.162 m, RKB = 567.162 m. Origin Measurement Depths (MD) per foot from RKB. Mud type: LSND Mud Daily Charges: Geologist: Paul StilesDays since spud: 40 Ground Level: 174.7' 520 Formation Tops From Wellsite Geologist Permafrost Formation Tops/ Markers -196 0 Top Franklin Bluffs Member (Middle Sagavanirktok) 2046 207 Base Franklin Bluffs Member (Middle Sagavanirktok) DAILY GEOLOGICAL AND OPERATIONS REPORT All measurement depths (MD) are quoted per foot from rotary kelly bushing (RKB) Coordinates: WELL : Merak 1 Latitude: 69° 58' 7.368 N Report date: 10/04/2012 Today's date: 10/05/2012 Kelly Bushing level (KB): 196.40' Last Survey: 10560.93'/10548.66'/8.06°/330.88° Representative: Mike Grubb, Jay Murphy Previous depth: 10,933' Spud date: 8/22/2012 60 Average ROP: 0 WOB (k): 7 RPM (Rot/min): 65 Bit #10 HDBS FX56 Daily Progress: 0'Total depth @ 24h00: 10,933' Casing and Liner Trip in hole from 5414' MD to 8656' MD above shoe. Fill pipe every 2000' Service Rig Reaming / washing from 9490' MD to 10,090' MD. Reaming / Washing from 10,090' MD to 10,843' MD Trip Out 484 Depth (SSTVD) Holocene Depth (TVD) 0 9171 7261 9388 8477 No fluid losses down hole. 1379 Zone Thickness 484 1355 761 484 691 7258 691 761 5520 5520 5892 6450 761 2046 2566 3732 9484 9211 9494 3732 2370 9192 2566 9288 213 9906 9801 558 9395 9407 9398 9180 10,933 9594 10812 374 10664 10149 iC5 & nC5 (ppm) Connection Gas 10014 9791 Upper Schrader Bluff Lower Sagavanirktok Lower Canning 8280 7065 Gas type & remarksC1 (ppm) LCU (Lower Cretaceous Unconformity) Base HRZ Pebble Shale 2.667 iC4 & nC4 (ppm) 8477 7062 1850 3536 5324 5696 6254 307 Trip in hole on elevators to 9490' MD Flow In (spm) 170 Gallons/stroke Lower Kingak TD PWD Kuparauk A Miluveach Upper Kingak Summary Operations Depth KB (MD) Gublik Current Operations Status (00h00 to 04h00) Formation Tops in Red Surface Tops in Blue Undetermined Tops in Black 10870-10880 Kuparauk C Hole opening 288 495 565 Lt sptty brt orange petro fluorescence Sandstone. White f-vf, sb-elg - sb-sph, w srt, pred qrtz, slt calc. 9417 8751 Hole Condition On Bot Hrs Avg Diam Top HRZ (Higly Radioactive Zone) 7196 Middle Schrader Bluff Depth In Formation Ivishak 2508 1 Direct fluorescence comment Cut fluorescence comment 20528 7817 7922653146472 Depth Out 10933 Dull lt blue fluorescence NEWHDBS FX56 FC3747 0 5 1093310843 64 10955 Dull light blue fluorescence, streaming light yellow cut fluor, Star cut residue Slow streaming light yellow cut fluor, v lt straw cut residue Flow In (gpm) 10933 0.000 59.000 450 SPP (psi) 2388 0 7.1 Current Pump & Flow Data 0 90 Ivishak Base Shublik Fire Creek Kuparauk B Mikkelson Tongue (Upper Canning) Lower Canning MCU (Mid Campanian Unconformity) Hue Shale Prince Creek Campanian Flooding Surface Lower Kingak (K-1 Top) Lower Kingak Base 8975 8948 Staines Tongue (Lower Sagavanirktok) 9192 9199 8280 8975 10920-10930 Total Charges: Chlorides (mg/l): 28000 Hardness (mg/l): 10615 10518 10714 Report number 47 Job No.:AK-AM-0009498071 Density: 12.2 Daily time-slot 00:00-03:00 03:00-10:00 10:00-12:00 12:00-21:00 21:00-23:00 23:30-00:00 Comments Interval (ft) 11094 Max Min Interval (ft) BHA Run #Bit Type Size TFA Hours Footage WOB RPM Condition BHA #15 Bit #10 8.5 0.8629 BHA #14 Bit #9 8.5 1.3 ROP Current Avg 24 hr Max Max @ Ft R.O.P. (ft/hr)0 20.06 Depth Ann Corr Drilling Min 12.91 Avg 13 Max 11094 5.16 0 All Circ Min 12.92 Avg 12.94 Max Total Charges: Chlorides (mg/l): 26000 Hardness (mg/l): 10615 10518 10714 Lower Kingak (K-1 Top) Lower Kingak Base 8975 8948 Staines Tongue (Lower Sagavanirktok) 9192 9199 8280 8975 Ivishak Base Shublik Fire Creek Kuparauk B Mikkelson Tongue (Upper Canning) Lower Canning MCU (Mid Campanian Unconformity) Hue Shale Prince Creek Campanian Flooding Surface 450 SPP (psi) 2500 0 7.1 Current Pump & Flow Data 0 0 90 73.23 11094 Flow In (gpm) 0 10933 0.000 59.000 HDBS FX56 FC3747 0 5 1093310843 Depth Out 0 10933 NEW 418 1 Direct fluorescence comment Cut fluorescence comment 1097 0 336 24748954 Hole Condition On Bot Hrs Avg Diam Top HRZ (Higly Radioactive Zone) 7196 Middle Schrader Bluff Depth In Formation 0 Ivishak Kuparauk C Circulate and condition. Build / pump 30 bbl HI - VIS sweep and spot @ 9,400' 288 495 565 Sandstone. trnsp, mlky wht, tn, occ lt gry, f - med gr, sb ang - sb rd, mo srt - pty srt, sli calc, 9417 8751 PWD Kuparauk A Miluveach Upper Kingak Summary Operations Depth KB (MD) Gublik Current Operations Status (00h00 to 04h00) Formation Tops in Red Surface Tops in Blue Undetermined Tops in Black Reaming / Washing Mad Pass from 11,094' - 10,750'. Flow In (spm) 170 Gallons/stroke Lower Kingak TD 2.667 iC4 & nC4 (ppm) 8477 7062 1850 3536 5324 5696 6254 307 Upper Schrader Bluff Lower Sagavanirktok Lower Canning 8280 7065 Gas type & remarksC1 (ppm) LCU (Lower Cretaceous Unconformity) Base HRZ Pebble Shale 11,080 9594 10812 374 10664 10149 iC5 & nC5 (ppm) Formation Gas 10014 9791 9288 213 9906 9801 558 9395 9407 9398 9180 2046 2566 3732 9484 9211 9494 3732 2370 9192 2566 484 691 7258 691 761 5520 5520 5892 6450 761 9171 7261 9388 8477 No fluid losses down hole. 1379 Zone Thickness 484 1355 761 Mad Pass Out / Wireline 484 Depth (SSTVD) Holocene Depth (TVD) 0 Casing and Liner Hole opening 6 1/8" hole to 8 1/2" from 10,843' to 10,933'. Rotary drilling from 10,933' to 11,094' Back reaming Mad Pass from 10,750' to 9,500' @ 240' / hr. Back reaming Mad Pass logging from 9,500' to 9,355' @ 120' / hr. Tight spot @ 9,370'. High torque, rotary stall & attempt to pack off @ 9,355' 60 Average ROP: 20.06 WOB (k): 12 RPM (Rot/min): 82 Bit #10 HDBS FX56 Daily Progress: 161'Total depth @ 24h00: 11,094'Last Survey: 11094.00'/11081.01'/2.64°/0.64° Representative: Mike Grubb, Jay Murphy Previous depth: 11,094' Spud date: 8/22/2012 DAILY GEOLOGICAL AND OPERATIONS REPORT All measurement depths (MD) are quoted per foot from rotary kelly bushing (RKB) Coordinates: WELL : Merak 1 Latitude: 69° 58' 7.368 N Report date: 10/05/2012 Today's date: 10/06/2012 Kelly Bushing level (KB): 196.40' 520 Formation Tops From Wellsite Geologist Permafrost Formation Tops/ Markers -196 0 Top Franklin Bluffs Member (Middle Sagavanirktok) 2046 207 Base Franklin Bluffs Member (Middle Sagavanirktok) Longitude: 148° 42' 48.292 W Mad Pass Out Casing shoe: 13 3/8" @ 2441 ft. Casing shoe: 9 5/8" @ 8726.6 ft. Next 24 Hours Forecast (00h00 to 24h00) Ground Level = 558.162 m, RKB = 567.162 m. Origin Measurement Depths (MD) per foot from RKB. Mud type: LSND Mud Daily Charges: Geologist: Paul StilesDays since spud: 41 Ground Level: 174.7' 8480 RIG: Nabors 105 Bit#10, footage/life: 161'/5.16hrs ROP (min-max): 0-73.23 Flow (gpm): 450 Stand pipe pressure (psi): 2500 2046 Water (% by volume):81% 9405 7 12 2189180 9388 555 1788 7261 8955 9398 77 8480 131 3 1166 10664 7392 7392 86 808 9171 1183 1850 1379 1193 372 5892 2046 7258 6450 667 Middle Sagavanirktok Gas Shows and chromatographic analysis 10802 10727 10697 10346 33 10714Top Shublik 10477 343 119 10357 10102 12.83 12.90 10510 Depth (ft)C2 (ppm)Total Gas (units) 8.5" 10727 10674 10674 10707 10518 10477 C3 (ppm) Summary lithological description and remarks Report number 48 Job No.: AK-AM-0009498071 Density: 8.5 Daily time-slot 00:00-03:00 03:00-10:00 10:00-12:00 12:00-21:00 21:00-23:00 23:30-00:00 Comments Interval (ft) 11094 Max Min Interval (ft) BHA Run # Bit Type Size TFA Hours Footage WOB RPM Condition BHA #15 Bit #10 8.5 0.8629 1-3-BT-T-X-I-CT-TD BHA #14 Bit #9 8.5 1.3 ROP Current Avg 24 hr Max Max @ Ft R.O.P. (ft/hr) 0 11 Depth Ann Corr Drilling Min N/A Avg N/A Max 11094 0 0 All Circ Min 12.89 Avg 13.07 Max Total Gas (units) 8.5" 10727 10674 10674 10707 10518 10477 C3 (ppm) Summary lithological description and remarks N/A 12.82 10510 Depth (ft) C2 (ppm) Top Shublik 10477 343 119 10357 10102 Middle Sagavanirktok Gas Shows and chromatographic analysis 10802 10727 10697 10346 33 10714 1183 1850 1379 1193 372 5892 2046 7258 6450 667 131 3 1166 10664 7392 7392 86 808 9171 9388 555 1788 7261 8955 9398 77 8480 9405 7 12 218 9180 8480 RIG: Nabors 105 Bit#10, footage/life: 0'/0hrs ROP (min-max): 0 Flow (gpm): N/A Stand pipe pressure (psi): N/A 2046 Water (% by volume): N/A Longitude: 148° 42' 48.292 W Running Wireline Casing shoe: 13 3/8" @ 2441 ft. Casing shoe: 9 5/8" @ 8726.6 ft. Next 24 Hours Forecast (00h00 to 24h00) Ground Level = 558.162 m, RKB = 567.162 m. Origin Measurement Depths (MD) per foot from RKB. Mud type: LSND Mud Daily Charges: Geologist: Paul Stiles Days since spud: 41 Ground Level: 174.7' 520 Formation Tops From Wellsite Geologist Permafrost Formation Tops/ Markers -196 0 Top Franklin Bluffs Member (Middle Sagavanirktok) 2046 207 Base Franklin Bluffs Member (Middle Sagavanirktok) DAILY GEOLOGICAL AND OPERATIONS REPORT All measurement depths (MD) are quoted per foot from rotary kelly bushing (RKB) Coordinates: WELL : Merak 1 Latitude: 69° 58' 7.368 N Report date: 10/06/2012 Today's date: 10/07/2012 Kelly Bushing level (KB): 196.40' Last Survey: 11094.00'/11081.01'/2.64 °/ 0.64 ° Representative: Mike Grubb, Jay Murphy Previous depth: 11,094' Spud date: 8/22/2012 N/A Average ROP: 0 WOB (k): N/A RPM (Rot/min): N/A Bit #10 HDBS FX56 Daily Progress: 0'Total depth @ 24h00: 11,094' Casing and Liner Continued pumping the sweep around to surface, circulating through tight spots. Pumped another 30 bbl high vis sweep. Encountered another tight spot at 9,269'. Continued washing/reaming. Mad passed from 9,269' to 9,047' at 120' an hour. Pumped a sweep at 8,860'. Resumed washing and reaming with no sign of tight spots. Pulled sources and laid down tools Rigged up to run wireline 484 Depth (SSTVD) Holocene Depth (TVD) 0 9171 7261 9388 8477 18 bbls lost to the trip out of the hole 1379 Zone Thickness 484 1355 761 484 691 7258 691 761 5520 5520 5892 6450 761 2046 2566 3732 9484 9211 9494 3732 2370 9192 2566 9288 213 9906 9801 558 9395 9407 9398 9180 11,094' 9594 10812 374 10664 10149 iC5 & nC5 (ppm) 10014 9791 Upper Schrader Bluff Lower Sagavanirktok Lower Canning 8280 7065 Gas type & remarks C1 (ppm) LCU (Lower Cretaceous Unconformity) Base HRZ Pebble Shale 2.667 iC4 & nC4 (ppm) 8477 7062 1850 3536 5324 5696 6254 307 washed/reamed to the shoe and pumped a bottoms up. Servied the rig and monitored for flow- Static. Resumed tripping out of the hole. -18 bbl loss for the trip. Flow In (spm) N/A Gallons/stroke Lower Kingak TD PWD Kuparauk A Miluveach Upper Kingak Summary Operations Depth KB (MD) Gublik Current Operations Status (00h00 to 04h00) Formation Tops in Red Surface Tops in Blue Undetermined Tops in Black N/A Kuparauk C Running wireline at report time. 288 495 565 N/A Sandstone. trnsp, mlky wht, tn, occ lt gry, f - med gr, sb ang - sb rd, mo srt - pty srt, sli calc, 9417 8751 Hole Condition On Bot Hrs Avg Diam Top HRZ (Higly Radioactive Zone) 7196 Middle Schrader Bluff Depth In Formation Ivishak 273 24 Direct fluorescence comment Cut fluorescence comment 1576 529 0 29 46 141 26254 Depth Out 10933 N/A HDBS FX56 FC3747 N/A 5 10933 10843 73.16 10953 N/A N/A Flow In (gpm) 11094 0.000 59.000 N/A SPP (psi) N/A N/A 7.1 Current Pump & Flow Data 161 90 Ivishak Base Shublik Fire Creek Kuparauk B Mikkelson Tongue (Upper Canning) Lower Canning MCU (Mid Campanian Unconformity) Hue Shale Prince Creek Campanian Flooding Surface Lower Kingak (K-1 Top) Lower Kingak Base 8975 8948 Staines Tongue (Lower Sagavanirktok) 9192 9199 8280 8975 N/A Total Charges: Chlorides (mg/l): N/A Hardness (mg/l): 10615 10518 10714 Report number 48 Job No.: AK-AM-0009498071 Density: 12.2 Daily time-slot 00:00-03:00 03:00-10:00 10:00-12:00 12:00-21:00 21:00-23:00 23:30-00:00 Comments Interval (ft) 11094 Max Min Interval (ft) BHA Run # Bit Type Size TFA Hours Footage WOB RPM Condition BHA #15 Bit #10 8.5 0.8629 1-3-BT-T-X-I-CT-TD BHA #14 Bit #9 8.5 1.3 ROP Current Avg 24 hr Max Max @ Ft R.O.P. (ft/hr) N/A N/A Depth Ann Corr Drilling Min N/A Avg N/A Max 11094 0 0 All Circ Min N/A Avg N/A Max Total Gas (units) 8.5" 10727 10674 10674 10707 10518 10477 C3 (ppm) Summary lithological description and remarks N/A N/A 10510 Depth (ft) C2 (ppm) 10714 Top Shublik 10477 343 119 10357 10102 667 Middle Sagavanirktok Gas Shows and chromatographic analysis 10802 10727 10697 10346 33 1193 372 5892 2046 7258 6450 131 3 1166 10664 7392 7392 86 808 9171 9388 555 1788 7261 8955 9398 77 8480 9405 7 12 218 9180 Ground Level: 174.7' 8480 RIG: Nabors 105 Bit#10, footage/life: 0'/0hrs ROP (min-max): 0 Flow (gpm): N/A Stand pipe pressure (psi): N/A 2046 Water (% by volume): 81% 207 Base Franklin Bluffs Member (Middle Sagavanirktok) Longitude: 148° 42' 48.292 W Running in the hole with 5" drill pipe. Casing shoe: 13 3/8" @ 2441 ft. Casing shoe: 9 5/8" @ 8726.6 ft. Next 24 Hours Forecast (00h00 to 24h00) Ground Level = 558.162 m, RKB = 567.162 m. Origin Measurement Depths (MD) per foot from RKB. Mud type: LSND Mud Daily Charges: Geologist: Paul Stiles Permafrost Formation Tops/ Markers -196 0 Top Franklin Bluffs Member (Middle Sagavanirktok) 2046 1183 1850 1379 DAILY GEOLOGICAL AND OPERATIONS REPORT All measurement depths (MD) are quoted per foot from rotary kelly bushing (RKB) Coordinates: WELL : Merak 1 Latitude: 69° 58' 7.368 N Report date: 10/07/2012 Today's date: 10/08/2012 Kelly Bushing level (KB): 196.40' Last Survey: 11094.00'/11081.01'/2.64 °/ 0.64 ° Representative: Mike Grubb, Jay Murphy Previous depth: 11,094' Spud date: 8/22/2012 Days since spud: 41 60 Average ROP: 0 WOB (k): N/A RPM (Rot/min): N/A Bit #10 HDBS FX56 Daily Progress: 0'Total depth @ 24h00: 11,094' Casing and Liner Continued running Wireline at 250' per minute in casing and 150' per minute in open hole but could not get below 8,740'. Pulled Wireline out of the hole and added the "Hole Finder" tool. Still could not get passed 8,740'. Pulled out of the hole and rigged down Wireline. Serviced the rig and picked up 2 7/8" tubing. Waited on orders. Tested BOP's 484 Depth (SSTVD) Holocene Depth (TVD) 0 Formation Tops From Wellsite Geologist 7261 9388 8477 18 bbls lost to the trip out of the hole 1379 Zone Thickness 484 1355 761 520 484 691 7258 691 761 5520 5520 5892 6450 761 2046 2566 3732 9484 9211 9494 3732 2370 9192 2566 9288 213 9906 9801 558 9395 9407 9398 9180 9171 11,094' 9594 10812 374 10664 10149 iC5 & nC5 (ppm) 10014 9791 Lower Sagavanirktok Lower Canning 8280 7065 Gas type & remarks C1 (ppm) LCU (Lower Cretaceous Unconformity) Base HRZ Pebble Shale 2.667 iC4 & nC4 (ppm) 8477 7062 1850 3536 5324 5696 6254 307 Flow In (spm) 151 Gallons/stroke Lower Kingak TD PWD Kuparauk A Miluveach Upper Kingak Summary Operations Depth KB (MD) Gublik Current Operations Status (00h00 to 04h00) Formation Tops in Red Surface Tops in Blue Undetermined Tops in Black N/A Kuparauk C Washing and reaming to bottom with 5" DP at report time. 288 495 565 N/A Sandstone. trnsp, mlky wht, tn, occ lt gry, f - med gr, sb ang - sb rd, mo srt - pty srt, sli calc, 9417 8751 Hole Condition On Bot Hrs Avg Diam Top HRZ (Higly Radioactive Zone) 7196 Middle Schrader Bluff Depth In Formation Ivishak 312 10 Direct fluorescence comment Cut fluorescence comment 1576 529 0 29 46 141 26254 Depth Out 10933 N/A HDBS FX56 FC3747 73.25 5 10933 10843 N/A 10953 N/A N/A Flow In (gpm) 11094 80.000 59.000 402 SPP (psi) 2176 10 7.1 Current Pump & Flow Data 161 90 Ivishak Base Shublik Fire Creek Kuparauk B Mikkelson Tongue (Upper Canning) Lower Canning MCU (Mid Campanian Unconformity) Hue Shale Prince Creek Campanian Flooding Surface Lower Kingak (K-1 Top) Lower Kingak Base 8975 8948 Staines Tongue (Lower Sagavanirktok) 9192 9199 8280 8975 Upper Schrader Bluff N/A Total Charges: Chlorides (mg/l): 27,000 Hardness (mg/l): 10615 10518 10714 Report number 48 Job No.: AK-AM-0009498071 Density: N/A Daily time-slot 00:00-03:00 03:00-10:00 10:00-12:00 12:00-21:00 21:00-23:00 23:30-00:00 Comments Interval (ft) 11094 Max Min Interval (ft) BHA Run # Bit Type Size TFA Hours Footage WOB RPM Condition BHA #15 Bit #10 8.5 0.8629 1-3-BT-T-X-I-CT-TD BHA #14 Bit #9 8.5 1.3 ROP Current Avg 24 hr Max Max @ Ft R.O.P. (ft/hr) N/A N/A Depth Ann Corr Drilling Min N/A Avg N/A Max 11094 0 0 All Circ Min N/A Avg N/A Max N/A Total Charges: Chlorides (mg/l): N/A Hardness (mg/l): 10615 10518 10714 Lower Kingak (K-1 Top) Lower Kingak Base 8975 8948 Staines Tongue (Lower Sagavanirktok) 9192 9199 8280 8975 Upper Schrader Bluff Ivishak Base Shublik Fire Creek Kuparauk B Mikkelson Tongue (Upper Canning) Lower Canning MCU (Mid Campanian Unconformity) Hue Shale Prince Creek Campanian Flooding Surface 2176 10 7.1 Current Pump & Flow Data 161 90 N/A N/A Flow In (gpm) 11094 80.000 59.000 306 SPP (psi) HDBS FX56 FC3747 73.25 5 10933 10843 Cut fluorescence comment 8581 1876 122 150 218 399 Middle Schrader Bluff Depth In Formation Ivishak 1691 309 Direct fluorescence comment 145737 Depth Out 565 N/A Sandstone. trnsp, mlky wht, tn, occ lt gry, f - med gr, sb ang - sb rd, mo srt - pty srt, sli calc, 9417 8751 Hole Condition On Bot Hrs Avg Diam Top HRZ (Higly Radioactive Zone) 7196 Summary Operations Depth KB (MD) Gublik Current Operations Status (00h00 to 04h00) Formation Tops in Red Surface Tops in Blue Undetermined Tops in Black N/A Kuparauk C Held another PJSM for cement job 288 495 TD PWD Kuparauk A Miluveach Upper Kingak 10933 N/A N/A N/A Flow In (spm) 114 Gallons/stroke 2.667 iC4 & nC4 (ppm) 8477 7062 1850 3536 5324 5696 6254 307 Lower Sagavanirktok Lower Canning 8280 7065 Gas type & remarks C1 (ppm) LCU (Lower Cretaceous Unconformity) Base HRZ Pebble Shale 11,028' 9594 10812 374 10664 10149 iC5 & nC5 (ppm) Trip Gas 10014 9791 213 9906 9801 558 9395 9407 9398 9180 9171 2566 3732 9484 9211 9494 3732 2370 9192 2566 9288 691 7258 691 761 5520 5520 5892 6450 761 2046 9388 8477 1379 Zone Thickness 484 1355 761 520 484 Stabilize volume and pump cement 484 Depth (SSTVD) Holocene Depth (TVD) 0 Formation Tops From Wellsite Geologist Washing/Reaming from 9,200 to 10,530'. Losses slowing, help prejob safety meeting for cement job in the doghouse Washing/Reaming to bottom. Experienceing losses N/A Average ROP: 0 WOB (k): N/A RPM (Rot/min): N/A Bit #10 HDBS FX56 Daily Progress: 0'Total depth @ 24h00: 11,094' Last Survey: 11094.00'/11081.01'/2.64 °/ 0.64 ° Representative: Mike Grubb, Jay Murphy Previous depth: 11,094' Spud date: 8/22/2012 Days since spud: 48 Latitude: 69° 58' 7.368 N Report date: 10/08/2012 Today's date: 10/09/2012 Kelly Bushing level (KB): 196.40' Top Franklin Bluffs Member (Middle Sagavanirktok) 2046 1183 1850 1379 DAILY GEOLOGICAL AND OPERATIONS REPORT All measurement depths (MD) are quoted per foot from rotary kelly bushing (RKB) Coordinates: WELL : Merak 1 Mud type: LSND Mud Daily Charges: Geologist: Paul Stiles Permafrost Formation Tops/ Markers -196 0 Casing and Liner Continued washing and reaming, circulating bottoms up at the shoe. Continued washing out of the shoe then tripped in the hole on elevators from 8,764' to 9,200' Continued washing and reaming from 9,200 to 9,638, working through tight spots, pumping high viscosity sweeps as needed. 2046 Water (% by volume): N/A 207 Base Franklin Bluffs Member (Middle Sagavanirktok) Longitude: 148° 42' 48.292 W Fighting Losses Casing shoe: 13 3/8" @ 2441 ft. Casing shoe: 9 5/8" @ 8726.6 ft. Next 24 Hours Forecast (00h00 to 24h00) Ground Level = 558.162 m, RKB = 567.162 m. Origin Measurement Depths (MD) per foot from RKB. 12 218 9180 Ground Level: 174.7' 8480 RIG: Nabors 105 Bit#10, footage/life: 0'/0hrs ROP (min-max): 0 Flow (gpm): N/A Stand pipe pressure (psi): N/A 1788 7261 8955 9398 77 8480 9405 7 7392 86 808 9171 9388 555 7261 1193 372 5892 2046 7258 6450 131 3 1166 7392 667 Middle Sagavanirktok Gas Shows and chromatographic analysis 10802 10727 10697 10346 33 10714 Top Shublik 10477 343 119 10357 10102 10664 Lower Kingak N/A N/A 10510 Depth (ft) C2 (ppm) Total Gas (units) 8.5" 10727 10674 10674 10707 10518 10477 C3 (ppm) Summary lithological description and remarks Report number 50 Job No.: AK-AM-0009498071 Density: 12.2 Daily time-slot 00:00-03:00 03:00-10:00 10:00-12:00 12:00-21:00 21:00-23:00 23:30-00:00 Comments Interval (ft) 11094 Max Ave Interval (ft) BHA Run # Bit Type Size TFA Hours Footage WOB RPM Condition BHA #15 Bit #10 8.5 0.8629 1-3-BT-T-X-I-CT-TD BHA #14 Bit #9 8.5 1.3 ROP Current Avg 24 hr Max Max @ Ft R.O.P. (ft/hr) N/A N/A Depth Ann Corr Drilling Min N/A Avg N/A Max 11094 0 0 All Circ Min N/A Avg N/A Max Total Gas (units) 8.5" 10727 10674 10674 10707 10518 10477 C3 (ppm) Lower Kingak N/A N/A 10510 Depth (ft) C2 (ppm) 343 119 10357 10102 10664 Middle Sagavanirktok Gas Shows and chromatographic analysis 10802 10727 10697 10346 33 10714 Top Shublik 372 5892 2046 7258 6450 131 3 1166 7392 86 808 9171 9388 555 7261 1193 7392 9398 77 8480 9405 7 RIG: Nabors 105 Bit#10, footage/life: 0'/0hrs ROP (min-max): 0 Flow (gpm): N/A Stand pipe pressure (psi): N/A 1788 667 Next 24 Hours Forecast (00h00 to 24h00) Ground Level = 558.162 m, RKB = 567.162 m. Origin Measurement Depths (MD) per foot from RKB. 12 218 9180 Ground Level: 174.7' 8480 7261 8955 Casing and Liner Pumped cement plugs and conditioned/worked pipe. Held a prejob safety meeting for the next cement job. Pressure tested cement lines to 5,000 PSI. Pumped cement plug- 5 bbls of water, 33 bbl spacer, 62 bbls of cement, 12 bbl spacer and 165 bbl displacement. 2046 Water (% by volume): 81% 207 Base Franklin Bluffs Member (Middle Sagavanirktok) Pulling out of the hole. Casing shoe: 13 3/8" @ 2441 ft. Casing shoe: 9 5/8" @ 8726.6 ft. 2046 1183 1850 1379 DAILY GEOLOGICAL AND OPERATIONS REPORT All measurement depths (MD) are quoted per foot from rotary kelly bushing (RKB) Coordinates: WELL : Merak 1 Mud type: LSND Mud Report date: 10/09/2012 Today's date: 10/010/2012 Kelly Bushing level (KB): 196.40' Top Franklin Bluffs Member (Middle Sagavanirktok) Daily Charges: Geologist: Paul Stiles Permafrost Formation Tops/ Markers Representative: Mike Grubb, Jay Murphy Previous depth: 11,094' Spud date: 8/22/2012 Days since spud: 49 Latitude: 69° 58' 7.368 N Longitude: 148° 42' 48.292 W 80 Average ROP: 0 WOB (k): N/A RPM (Rot/min): N/A Bit #10 HDBS FX56 Daily Progress: 0'Total depth @ 24h00: 11,094' Last Survey: 11094.00'/11081.01'/2.64 °/ 0.64 ° Tripped out of the hole to 9,747' with minimal overpull to spot the second cement plug. Reamed and washed the wiper ball at 9,727' and washed down to 10,170' Pumped 3rd cement plug. at 375 GPM. 484 Preparing for rig down. 484 Depth (SSTVD) Holocene Depth (TVD) 0 Formation Tops From Wellsite Geologist -196 0 2046 9388 8477 343 bbls lost downhole 1379 Zone Thickness 484 1355 761 520 9288 691 7258 691 761 5520 5520 5892 6450 761 9171 2566 3732 9484 9211 9494 3732 2370 9192 2566 10014 9791 213 9906 9801 558 9395 9407 9398 9180 10812 374 10664 10149 iC5 & nC5 (ppm) Trip Gas 10477 Summary lithological description and remarks 307 Lower Sagavanirktok Lower Canning 8280 7065 Gas type & remarks C1 (ppm) LCU (Lower Cretaceous Unconformity) Base HRZ Pebble Shale iC4 & nC4 (ppm) 8477 7062 1850 3536 5324 5696 6254 9594 Flow In (spm) N/A Gallons/stroke 2.667 TD PWD Kuparauk A Miluveach Upper Kingak 10933 N/A N/A N/A Summary Operations Depth KB (MD) Gublik Current Operations Status (00h00 to 04h00) Formation Tops in Red Surface Tops in Blue Undetermined Tops in Black N/A Kuparauk C Pumped dry job. Pulling out of the hole at report time. 288 495 565 N/A Sandstone. trnsp, mlky wht, tn, occ lt gry, f - med gr, sb ang - sb rd, mo srt - pty srt, sli calc, 9417 8751 Hole Condition On Bot Hrs Avg Diam Top HRZ (Higly Radioactive Zone) 7196 Middle Schrader Bluff Depth In Formation Ivishak 1691 141 Direct fluorescence comment 145737 8581 1876 122 150 218 399 11,028' FC3747 73.25 5 10933 10843 Cut fluorescence comment Depth Out Flow In (gpm) 11094 80.000 59.000 N/A SPP (psi) HDBS FX56 N/A 10 7.1 Current Pump & Flow Data 161 90 N/A N/A Ivishak Base Shublik Fire Creek Kuparauk B Mikkelson Tongue (Upper Canning) Lower Canning MCU (Mid Campanian Unconformity) Hue Shale Prince Creek Campanian Flooding Surface Lower Kingak (K-1 Top) Lower Kingak Base 8975 8948 Staines Tongue (Lower Sagavanirktok) 9192 9199 8280 8975 Upper Schrader Bluff N/A Total Charges: Chlorides (mg/l): 25,000 Hardness (mg/l): 10615 10518 10714 Report number 50 Job No.:AK-AM-0009498071 Density: Daily time-slot 00:00-01:00 01:00-06:00 06:00-11:30 11:30-13:00 13:00-14:00 14:00-19:00 19:00-21:00 21:00-22:00 22:00-24:00 Comments Interval (ft) 11094 Max Ave Interval (ft) BHA Run #Bit Type Size TFA Hours Footage WOB RPM Condition BHA #15 Bit #10 8.5 0.8629 1-3-BT-T-X-I-CT-TD BHA #14 Bit #9 8.5 1.3 ROP Current Avg 24 hr Max Max @ Ft R.O.P. (ft/hr)N/A N/A Depth Ann Corr Drilling Min N/A Avg N/A Max 11094 0 0 All Circ Min N/A Avg N/A Max Hardness (mg/l): 10615 10518 10714 L/D test tool and equip, pull test plug, install weat bushing, blowdonw choke and kill lines. Lower Kingak (K-1 Top) Lower Kingak Base 8975 8948 Staines Tongue (Lower Sagavanirktok) 9192 9199 8280 8975 Upper Schrader Bluff Ivishak Base Shublik Fire Creek Kuparauk B Mikkelson Tongue (Upper Canning) Lower Canning MCU (Mid Campanian Unconformity) Hue Shale Prince Creek Campanian Flooding Surface N/A 10 7.1 Current Pump & Flow Data 161 90 N/A N/A Flow In (gpm) 11094 80.000 59.000 N/A SPP (psi) HDBS FX56 FC3747 73.25 5 1093310843 Cut fluorescence comment Depth Out N/A 1876 122 150218 399 11,028' Middle Schrader Bluff Depth In Formation Ivishak 1691 141 Direct fluorescence comment 145737 565 N/A Sandstone. trnsp, mlky wht, tn, occ lt gry, f - med gr, sb ang - sb rd, mo srt - pty srt, sli calc, 9417 8751 Hole Condition On Bot Hrs Avg Diam Top HRZ (Higly Radioactive Zone) 7196 Summary Operations Depth KB (MD) Gublik Current Operations Status (00h00 to 04h00) Formation Tops in Red Surface Tops in Blue Undetermined Tops in Black N/A Kuparauk C P/U test tools, R/U test equipment, fill stack & choke, test BOPS and related valves 250/5000 psi, annular 250/2500 psi, test H2 and gas sensor. BOP test witnessed by AOGCC 288 495 Kuparauk A Miluveach Upper Kingak 10933 N/A N/A N/A 8581 9594 Flow In (spm) N/A Gallons/stroke 2.667 PWD 7062 1850 3536 5324 5696 6254 Lower Sagavanirktok Lower Canning 8280 7065 Gas type & remarksC1 (ppm) LCU (Lower Cretaceous Unconformity) Base HRZ Pebble Shale iC4 & nC4 (ppm) 10812 374 10664 10149 iC5 & nC5 (ppm) Trip Gas 10477 Summary lithological description and remarks TD 9791 213 9906 9801 558 9395 9407 9398 9180 307 2566 3732 9484 9211 9494 3732 2370 9192 2566 8477 9288 691 7258 691 761 5520 5520 5892 6450 761 9388 8477 1379 Zone Thickness 484 1355 761 520 9171 484 RIH, set cement plug #4 above 9 5/8" casing shoe. 484 Depth (SSTVD) Holocene Depth (TVD) 0 Formation Tops From Wellsite Geologist -196 0 Trip out of hole with 2 7/8" tubing, l/d bad tubing, racked back 4 stnads, L/D 18 jts total. R/D 2 7/8" tubing equipment. Pull wear ring, set test plug L/D test tool, R/D 5" test jt, p/u 2 7/8" test jt, blow down Topdrive, test lower 2 7/8" x 5" variables , test blind rams R/U 2 7/8" equipment, TIH w/ 4 stands to 2 7/8" tubing to 381'. Trip in hole with 5" DP to 1331' P/U test tools, function rams, flush stack, function test BOPS, flush stack and blow down surface equipment. WOB (k): N/A RPM (Rot/min): N/A Bit #10 HDBS FX56 Daily Progress: 0'Total depth @ 24h00: 11,094'Last Survey: 11094.00'/11081.01'/2.64°/0.64° Days since spud: 49 Latitude: 69° 58' 7.368 N Longitude: 148° 42' 48.292 W Average ROP: 0 Total Charges: Chlorides (mg/l): Kelly Bushing level (KB): 196.40' Top Franklin Bluffs Member (Middle Sagavanirktok) Daily Charges: Geologist: Paul Stiles Permafrost Formation Tops/ Markers Representative: Mike Grubb, Craig Ruminer Previous depth: 11,094' Spud date: 8/22/2012 1379 DAILY GEOLOGICAL AND OPERATIONS REPORT All measurement depths (MD) are quoted per foot from rotary kelly bushing (RKB) Coordinates: WELL : Merak 1 Mud type: LSND Mud Report date: 10/10/2012 Today's date: 10/11/2012 Casing and Liner cleanout cmnt stinger, circ bttms up @ 8573', minal trace of spacer to pits trip out of hole f/ 8573' t/948' 2046 Water (% by volume): 207 Base Franklin Bluffs Member (Middle Sagavanirktok) Tripping into the hole Casing shoe: 13 3/8" @ 2441 ft. Casing shoe: 9 5/8" @ 8726.6 ft. Next 24 Hours Forecast (00h00 to 24h00) Ground Level = 558.162 m, RKB = 567.162 m. Origin Measurement Depths (MD) per foot from RKB. 12 2189180 Ground Level: 174.7' 8480 7261 8955 RIG: Nabors 105 Bit#10, footage/life: 0'/0hrs ROP (min-max): 0 Flow (gpm): N/A Stand pipe pressure (psi): N/A 1788 667 2046 1183 1850 9398 77 8480 9405 7 7392 86 808 9171 9388 555 7261 11937392 372 5892 2046 7258 6450 131 3 1166 2046 Middle Sagavanirktok Gas Shows and chromatographic analysis 10802 10727 10697 10346 33 10714Top Shublik 343 119 10357 10102 10664 10014Lower Kingak N/A N/A 10510 Depth (ft)C2 (ppm)Total Gas (units) 8.5" 10727 10674 10674 10707 10518 10477 C3 (ppm) Report number 51 Job No.:AK-AM-0009498071 Density: 12.2 Daily time-slot 00:00-07:00 07:00-09:00 09:00-09:30 09:30-13:30 13:30-15:30 15:30-17:00 17:00-18:30 18:30-21:30 21:30-22:00 22:00-24:00 Comments Interval (ft) 11094 Max Ave Interval (ft) BHA Run #Bit Type Size TFA Hours Footage WOB RPM Condition BHA #15 Bit #10 8.5 0.8629 1-3-BT-T-X-I-CT-TD BHA #14 Bit #9 8.5 1.3 ROP Current Avg 24 hr Max Max @ Ft R.O.P. (ft/hr)N/A N/A Depth Ann Corr Drilling Min N/A Avg N/A Max 11094 0 0 All Circ Min N/A Avg N/A Max8.5" 10727 10674 10674 10707 10518 10477 C3 (ppm) Lower Kingak N/A N/A 10510 Depth (ft)C2 (ppm) 343 119 10357 10102 10664 10014 Middle Sagavanirktok Gas Shows and chromatographic analysis 10802 10727 10697 10346 33 10714Top Shublik 372 5892 2046 7258 6450 131 3 1166 2046 7392 86 808 9171 9388 555 7261 11937392 9398 77 8480 9405 7 RIG: Nabors 105 Bit#10, footage/life: 0'/0hrs ROP (min-max): 0 Flow (gpm): N/A Stand pipe pressure (psi): N/A 1788 667 2046 1183 1850 Next 24 Hours Forecast (00h00 to 24h00) Ground Level = 558.162 m, RKB = 567.162 m. Origin Measurement Depths (MD) per foot from RKB. 12 2189180 Ground Level: 174.7' 8480 7261 8955 Casing and Liner Trip into the hole to 8491', Wash down f/ 8491', tagged cement at 8822' Circulate bottoms up, minimal trace of cement at shakers 2046 Water (% by volume):0.0/80.5% 207 Base Franklin Bluffs Member (Middle Sagavanirktok) Slip and cut, wait on cement to set Casing shoe: 13 3/8" @ 2441 ft. Casing shoe: 9 5/8" @ 8726.6 ft. 1379 DAILY GEOLOGICAL AND OPERATIONS REPORT All measurement depths (MD) are quoted per foot from rotary kelly bushing (RKB) Coordinates: WELL : Merak 1 Mud type: LSND Mud Report date: 10/11/2012 Today's date: 10/12/2012 Kelly Bushing level (KB): 196.40' Top Franklin Bluffs Member (Middle Sagavanirktok) Daily Charges: Geologist: Paul Stiles Permafrost Formation Tops/ Markers Representative: Mike Grubb, Craig Ruminer Previous depth: 11,094' Spud date: 8/22/2012 Days since spud: 50 Latitude: 69° 58' 7.368 N Longitude: 148° 42' 48.292 W 80 Average ROP: 0 Total Charges: Chlorides (mg/l): 23,000 WOB (k): N/A RPM (Rot/min): N/A Bit #10 HDBS FX56 Daily Progress: 0'Total depth @ 24h00: 11,094'Last Survey: 11094.00'/11081.01'/2.64°/0.64° Slip and cut drill line. Pumped dry job @ 8822' RIH w/ stands f/ derrick, tagged cement at 8822', Test lines, pump plug #4, displace w/ rig pumps, CIP @ 18:08hrs. TOH f/ 8475'' t/8294', Blow down Top Drive L/D drill pipe f/ 8822' to 6732' 484 tag up on cement, pull out of hole and lay down DP. 484 Depth (SSTVD) Holocene Depth (TVD) 0 Formation Tops From Wellsite Geologist -196 0 9388 8477 1379 Zone Thickness 484 1355 761 520 9171 9288 691 7258 691 761 5520 5520 5892 6450 761 2566 3732 9484 9211 9494 3732 2370 9192 2566 8477 9791 213 9906 9801 558 9395 9407 9398 9180 307 10664 10149 iC5 & nC5 (ppm) 10477 Summary lithological description and remarks TD Total Gas (units) 8280 7065 Gas type & remarksC1 (ppm) LCU (Lower Cretaceous Unconformity) Base HRZ Pebble Shale iC4 & nC4 (ppm) 10812 374 7062 1850 3536 5324 5696 6254 Flow In (spm) N/A Gallons/stroke 2.667 PWD Kuparauk A Miluveach Upper Kingak 10933 N/A N/A N/A Summary Operations Depth KB (MD) Gublik Current Operations Status (00h00 to 04h00) Formation Tops in Red Surface Tops in Blue Undetermined Tops in Black N/A Kuparauk C R/U cement lines, PJSM f/ cementing 288 495 565 N/A Sandstone. trnsp, mlky wht, tn, occ lt gry, f - med gr, sb ang - sb rd, mo srt - pty srt, sli calc, 9417 8751 Hole Condition On Bot Hrs Avg Diam Top HRZ (Higly Radioactive Zone) 7196 Middle Schrader Bluff Depth In Formation Ivishak Direct fluorescence comment FC3747 73.25 5 1093310843 Cut fluorescence comment Depth Out N/A Flow In (gpm) 11094 80.000 59.000 N/A SPP (psi) HDBS FX56 N/A 10 7.1 Current Pump & Flow Data 161 90 N/A N/A Mikkelson Tongue (Upper Canning) Lower Canning MCU (Mid Campanian Unconformity) Hue Shale Prince Creek Campanian Flooding Surface Lower Sagavanirktok Lower Canning 9192 9199 8280 8975 Upper Schrader Bluff Ivishak Base Shublik Fire Creek Kuparauk B 9594 Hardness (mg/l): 10615 10518 10714 R/D cement lines, Trip out of hole to 8134'. Drop wiper ball down DP. Wash down f/8134' t/8475', cir4culate and condition, dump 50 bbls contaminated mud Lower Kingak (K-1 Top) Lower Kingak Base 8975 8948 Staines Tongue (Lower Sagavanirktok) WE L L N A M E : Me r a k 1 LO C A T I O N : Exploration OP E R A T O R : Gr e a t B e a r P e t r o l e u m L L C AR E A : North Slope MU D C O : Ba r o i d ST A T E : Alaska RI G : Na b o r s 1 0 5 SP U D : 22-Aug-12 SP E R R Y J O B : AK - A M - 0 0 0 9 4 9 8 0 7 1 TD : 5-Oct-12 BI T RE C O R D BH A # S D L RU N # Bi t # B i t T y p e B i t Si z e De p t h In De p t h Ou t Fo o t a g e B i t Ho u r s TF A A V G RO P WO B (m a x ) RP M (m a x ) SP P (m a x ) FL O W G P M (m a x ) Bi t G r a d e R e m a r k s 1 1 0 0 1 H D B S E B X T 1 G R C 1 6 . 0 0 0 1 1 4 7 0 7 5 9 3 8 . 2 3 0 . 6 9 9 5 7 2 . 0 12 50 1 6 9 0 4 8 8 4- 4 - W T - A - E - 1 - P N - P P POOH for loss of pump pressure, C/O bit 2 2 0 0 2 H D B S E B X T 1 G R C 1 6 . 0 0 0 7 0 7 2 4 6 2 1 7 5 5 3 1 . 7 2 0 . 6 9 9 5 5 5 . 0 16 80 2 1 5 0 6 1 1 6- 5 - W T - A - E - 1 - E R - T D Drilled to surface casing TD 3 3 0 0 3 H D B S F X 5 6 M 1 2 . 2 5 0 2 4 6 2 8 7 5 0 6 2 8 8 9 5 . 6 3 0 . 8 6 2 9 6 6 . 0 12 90 2 3 5 0 6 0 0 1 - 2 - C T - A - X - I - B T - T D D r illed to Intermediate casing TD 4 4 0 0 3 r r 1 H D B S F X 5 6 M 1 2 . 2 5 0 8 7 5 0 8 7 5 0 0 - 0 . 8 6 2 9 - - - - - 1 - 2 - C T - A - X - I - B T - T D C l e a n o u t R u n 5 5 0 0 4 H D B S F X 5 6 8 . 5 0 0 8 7 5 0 8 7 5 0 0 - 0 . 8 6 2 9 - -- - - 0- 0 - P N - C - X - I - R R - B H A Cleanout Plug @ 2400' 6 6 0 0 4 r r 1 H D B S F X 5 6 8 . 5 0 0 8 7 5 0 9 0 1 2 2 6 2 6 . 1 9 0 . 8 6 2 9 42 . 0 10 1 2 0 1 6 8 0 4 2 5 3 - 2 - C T - A - X - I - D L - C P D r illed to Core Point 7 7 0 0 5 H D B S F C 3 7 4 7 8 . 5 0 0 9 0 1 2 9 0 2 8 1 6 7 . 7 0 1 . 3 0 0 0 2. 0 23 1 2 1 1 1 8 5 3 2 0 - C o r i n g R u n - C o r e # 1 - 1 4 . 3 7 ' R e c o v e r e d 8 8 0 0 6 H D B S F C 3 7 4 7 8 . 5 0 0 9 0 2 8 9 0 8 9 6 1 2 5 . 4 0 1 . 3 0 0 0 2. 4 23 1 2 1 1 1 0 9 3 0 1 - C o r i n g R u n - C o r e # 2 - 1 0 0 % R e c o v e r e d 9 9 0 0 7 H D B S F X 5 6 8 . 5 0 0 9 0 8 9 1 0 6 1 1 1 5 2 2 2 2 . 0 9 0 . 8 6 2 9 68 . 9 24 9 5 3 4 5 2 4 5 0 3 - 2 - C T - A - X - I - P N - C P D r illed to Core Point 10 1 0 0 0 8 H D B S F C 3 7 4 7 8 . 5 0 0 1 0 6 1 1 1 0 6 6 0 4 9 5 7 . 0 0 1 . 3 0 0 0 0. 9 23 7 1 11 9 2 2 9 4 - C o r i n g R u n - C o r e # 3 - 1 0 0 % R e c o v e r e d 11 1 1 0 0 9 H D B S F C 3 6 4 8 8 . 5 0 0 1 0 6 6 0 1 0 7 4 8 8 8 5 . 1 0 1 . 3 0 0 0 17 . 5 23 7 0 11 0 8 2 9 0 - C o r i n g R u n - C o r e # 4 - 1 0 0 % R e c o v e r e d 12 1 2 0 0 1 0 H D B S F C 3 6 4 8 8 . 5 0 0 1 0 7 4 8 1 0 7 5 3 5 1 . 3 0 1 . 3 0 0 0 3. 8 31 7 1 90 2 2 4 5 - C o r i n g R u n - C o r e # 5 - 2 ' R e v o v e r e d 13 1 3 0 0 1 1 H D B S F C 3 6 4 8 8 . 5 0 0 1 0 7 5 3 1 0 8 4 3 9 0 4 . 1 0 1 . 3 0 0 0 21 . 9 28 7 2 99 5 2 6 1 - C o r i n g R u n - C o r e # 6 - 1 0 0 % R e c o v e r e d 14 1 4 0 0 1 2 H D B S F C 3 6 4 5 6 . 1 2 5 1 0 8 4 3 1 0 9 3 3 9 0 8 . 1 0 1 . 3 0 0 0 11 . 1 19 7 7 12 4 2 1 8 4 - C o r i n g R u n - C o r e # 7 - 1 0 0 % R e v o c e r e d 15 1 5 0 0 1 3 H D B S F X 5 6 8 . 5 0 0 1 0 9 3 3 1 1 0 9 4 1 6 1 5 . 3 8 0 . 8 6 2 9 29 . 9 13 8 4 26 5 0 4 5 0 1 - 3 - B T - T - X - I - C T - T D D r ill to TD, MA D PASS to shoe W E L L N A M E : Me r a k 1 LO C A T I O N : Ex p l o r a t i o n OP E R A T O R : Gr e a t B e a r P e t r o l e u m L L C AR E A : No r t h S l o p e MU D C O : Ba r o i d ST A T E : Al a s k a RI G : Na b o r s 1 0 5 SP U D : 22 - A u g - 1 2 SP E R R Y J O B : AK - A M - 0 0 0 9 4 9 8 0 7 1 TD : 5- O c t - 1 2 W a t e r - B a s e d M u d R e c o r d Da t e D e p t h W t V i s P V Y P G e l s F i l t R6 0 0 / R 3 0 0 / R 2 0 0 / R 1 0 0 / R6 / R 3 Ca k e S o l i d s Oi l / W a t e r Sd P f / M f p H P m M B T C h l o r i d e s H a r d n e s s R e m a r k s ft - M D p p g s e c l b / 1 0 0 l b / 1 0 0 f t 2 m / 3 0 m R h e o m e t e r 3 2 n d s % % % l b / g a l m g / L C a + + 21 - A u g 0 8 . 8 0 3 0 0 2 4 4 2 3 4 / 3 7 / 0 9 . 8 9 0 / 6 6 / 5 7 / 4 6 / 3 2 / 3 1 1 / 0 2 . 7 0 . 0 / 9 7 . 0 - 0 . 0 7 / 0 . 2 2 9 . 8 0 . 2 4 - 1 2 0 0 1 0 0 R i g U p 22 - A u g 7 0 7 9 . 2 0 2 0 0 3 9 4 8 2 1 / 2 7 / 0 7 . 8 1 2 6 / 8 7 / 6 9 / 5 0 / 2 3 / 2 1 3 / 0 4 . 7 0 . 0 / 9 5 . 0 3 . 0 0 0 . 1 0 / 0 . 3 6 8 . 9 0 . 1 8 2 5 . 0 8 0 0 1 2 0 D r i l l i n g 23 - A u g 1 8 5 3 9 . 6 0 1 8 0 4 2 5 1 1 7 / 4 0 / 0 7 . 2 1 3 5 / 9 3 / 7 5 / 5 3 / 2 4 / 2 3 3 / 0 8 . 8 0 . 0 / 9 1 . 0 2 . 0 0 0 . 1 0 / 0 . 5 0 8 . 7 0 . 2 0 2 2 . 0 6 0 0 5 0 D r i l l i n g 24 - A u g 2 4 6 2 9 . 6 0 8 5 2 9 3 0 2 4 / 4 0 / 0 7 . 0 8 8 / 5 9 / 4 8 / 3 3 / 1 3 / 1 2 3 / 0 9 . 3 0 . 0 / 9 0 . 5 1 . 5 0 0 . 1 0 / 0 . 5 0 8 . 5 0 . 1 5 2 5 . 0 6 0 0 4 0 T D S u r f a c e H o l e / C l e a n out Run 25 - A u g 2 4 6 2 9 . 5 0 6 5 1 9 2 0 1 4 / 2 5 / 0 7 . 4 5 8 / 3 9 / 3 1 / 2 3 / 1 3 / 1 2 3 / 0 9 . 3 0 . 0 / 9 0 . 5 1 . 5 0 0 . 0 5 / 0 . 5 0 8 . 5 0 . 1 0 2 6 . 0 6 0 0 4 0 R u n C a s i n g 26 - A u g 2 4 6 2 9 . 5 0 5 0 1 8 1 5 4 / 2 3 / 0 7 . 7 5 1 / 3 3 / 2 5 / 1 7 / 8 / 7 3 / 0 8 . 8 0 . 0 / 9 1 . 0 1 . 5 0 0 . 0 5 / 0 . 5 0 8 . 4 0 . 1 0 2 5 . 0 6 0 0 4 0 C e m e n t C a s i n g 27 - A u g 2 4 6 2 9 . 5 0 5 0 1 9 1 4 4 / 2 4 / 0 7 . 5 5 2 / 3 3 / 2 5 / 1 7 / 8 / 7 3 / 0 8 . 8 0 . 0 / 9 1 . 0 1 . 5 0 0 . 0 5 / 0 . 5 0 8 . 4 0 . 1 0 2 5 . 0 6 0 0 4 0 N i p p l e U p B O P 28 - A u g 2 4 6 2 9 . 2 0 4 5 1 2 2 0 8 / 1 1 / 0 5 . 6 4 4 / 3 2 / 2 7 / 2 0 / 8 / 7 1 / 0 3 . 4 0 . 0 / 9 6 . 0 - 0 . 1 5 / 0 . 6 0 9 . 4 0 . 3 0 - 1 0 0 0 0 1 2 0 T e s t B O P s 29 - A u g 3 1 1 3 9 . 2 0 4 1 1 2 1 8 8 / 1 1 / 1 3 4 . 6 4 2 / 3 0 / 2 6 / 2 0 8 / 7 1 / 0 5 . 1 0 . 0 / 9 4 . 0 - 0 . 1 5 / 0 . 6 0 9 . 4 0 . 3 5 2 . 5 1 0 0 0 0 2 0 0 D r i l l i n g 30 - A u g 4 3 7 3 9 . 3 0 4 2 1 2 2 4 1 0 / 1 3 / 1 5 5 . 2 4 8 / 3 6 / 3 1 / 2 5 / 1 3 / 1 2 1 / 0 4 . 7 0 . 0 / 9 4 . 5 1 . 0 0 0 . 2 5 / 1 . 0 0 1 0 . 6 0 . 5 0 6 . 0 8 5 0 0 2 0 0 D r i l l i n g 31 - A u g 5 5 0 7 9 . 3 5 4 2 8 1 8 4 / 7 / 1 0 5 . 4 3 4 / 2 6 / 2 2 / 1 7 / 7 / 6 1 / 0 5 . 3 0 . 0 / 9 3 . 5 1 . 0 0 0 . 2 0 / 0 . 6 0 1 0 . 2 0 . 4 0 8 . 0 8 0 0 0 1 8 0 D r i l l i n g 1- S e p 6 5 6 0 9 . 3 0 4 2 1 0 1 8 4 / 7 / 1 0 5 . 2 3 8 / 2 8 / 2 3 / 1 8 / 6 / 5 1 / 0 5 . 0 1 . 0 / 9 3 . 3 0 . 5 0 0 . 2 0 / 0 . 6 0 1 0 . 0 0 . 4 0 7 . 0 8 0 0 0 1 2 0 D r i l l i n g 2- S e p 7 6 1 3 9 . 4 0 4 8 1 0 2 0 4 / 7 / 1 1 5 . 0 4 0 / 3 0 / 2 4 / 1 8 / 6 / 5 1 / 0 5 . 0 1 . 0 / 9 3 . 0 0 . 2 5 0 . 1 0 / 0 . 6 0 1 0 . 0 0 . 2 0 7 . 0 7 5 0 0 1 0 0 D r i l l i n g 3- S e p 8 2 6 0 9 . 5 0 4 8 1 4 1 9 4 / 6 / 1 0 4 . 8 4 7 / 3 3 / 2 7 / 1 9 / 5 / 4 1 / 0 5 . 2 1 . 0 / 9 3 . 0 0 . 2 5 0 . 1 0 / 0 . 6 0 1 0 . 0 0 . 2 0 5 . 5 9 0 0 0 4 0 D r i l l i n g 4- S e p 8 7 5 0 9 . 6 0 4 9 1 5 2 0 4 / 6 / 1 0 4 . 4 5 0 / 3 5 / 2 7 / 1 9 / 5 / 4 2 / 3 6 . 7 1 . 0 / 9 1 . 5 0 . 2 5 0 . 1 0 / 0 . 6 0 1 0 . 0 0 . 2 0 6 . 0 8 5 0 0 4 0 D r i l l e d t o C a s i n g P o i n t 5- S e p 8 7 5 0 9 . 6 0 4 7 1 7 1 9 4 / 8 / 1 1 4 . 4 5 3 / 3 6 / 2 9 / 2 0 / 5 / 4 2 / 3 7 . 2 1 . 0 / 9 1 . 0 0 . 2 5 0 . 1 0 / 0 . 6 0 1 0 . 0 0 . 2 0 6 . 0 8 5 0 0 4 0 W i p e r T r i p 6- S e p 8 7 5 0 9 . 7 0 5 6 1 8 2 2 5 / 1 1 / 1 4 4 . 0 5 8 / 4 0 / 3 2 / 2 3 / 5 / 4 2 / 3 8 . 2 1 . 0 / 9 0 . 0 0 . 2 5 0 . 1 5 / 0 . 8 0 1 0 . 0 0 . 2 0 9 . 0 9 0 0 0 4 0 W i p e r / L / D T o o l s 7- S e p 8 7 5 0 9 . 7 5 5 5 1 6 2 0 4 / 1 0 / 1 3 4 . 0 5 2 / 3 6 / 2 9 / 2 0 / 5 / 4 2 / 3 8 . 2 1 . 0 / 9 0 . 0 0 . 2 5 0 . 1 0 / 0 . 9 0 9 . 5 0 . 3 0 9 . 0 9 0 0 0 4 0 E - l o g / T e s t B O P s 8- S e p 8 7 5 0 9 . 7 5 5 4 1 4 1 8 4 / 8 / 1 1 4 . 4 4 6 / 3 2 / 2 4 / 1 7 / 6 / 4 2 / 3 8 . 2 1 . 0 / 9 0 . 0 0 . 2 5 0 . 1 0 / 0 . 9 0 9 . 9 0 . 9 0 9 . 5 9 0 0 0 4 0 C l e a n O u t R u n 9- S e p 8 7 5 0 9 . 7 5 6 1 1 8 2 3 6 / 9 / 1 2 4 . 8 5 9 / 4 1 / 3 4 / 2 4 / 7 / 5 2 / 3 8 . 7 1 . 0 / 8 9 . 5 0 . 2 5 0 . 1 0 / 1 . 0 0 9 . 6 0 . 2 0 9 . 5 9 0 0 0 4 0 R u n C a s i n g 10 - S e p 8 7 5 0 9 . 7 5 6 0 1 6 1 6 4 / 6 / 9 4 . 4 5 2 / 3 4 / 2 2 / 1 8 / 4 / 3 2 / 3 8 . 7 1 . 0 / 8 9 . 5 0 . 2 5 0 . 1 0 / 0 . 9 0 9 . 5 0 . 2 0 9 . 5 9 0 0 0 8 0 R u n C a s i n g / C e m e n t 11 - S e p 8 7 5 0 9 . 7 5 5 9 1 5 1 8 4 / 7 / 1 0 5 . 2 4 8 / 3 3 / 2 1 / 1 9 / 4 / 3 2 / 3 8 . 8 1 . 0 / 8 9 . 5 0 . 2 5 0 . 0 5 / 1 . 1 0 9 . 0 0 . 1 0 9 . 5 8 5 0 0 1 0 0 N i p p l e D o w n 12 - S e p 8 7 5 0 9 . 7 5 5 8 1 5 1 8 4 / 7 / 1 1 5 . 2 4 8 / 3 3 / 2 3 / 1 8 / 4 / 3 2 / 3 8 . 8 1 . 0 / 8 9 . 5 0 . 2 5 0 . 0 5 / 1 . 1 0 8 . 7 0 . 1 0 9 . 5 8 5 0 0 1 0 0 N i p p l e U p / T e s t 13 - S e p 8 7 5 0 9 . 8 0 5 8 1 5 1 8 4 / 7 / 1 0 5 . 2 4 8 / 3 3 / 2 3 / 1 8 / 4 / 3 2 / 3 8 . 8 1 . 0 / 8 9 . 5 0 . 2 5 0 . 0 5 / 1 . 2 0 8 . 6 0 . 1 0 9 . 5 8 5 0 0 1 0 0 H o o k u p M P D / D r i l l O u t P lug 14 - S e p 8 7 5 0 9 . 8 0 5 8 1 5 1 8 4 / 7 / 1 0 5 . 2 4 8 / 3 3 / 2 3 / 1 8 / 4 / 3 2 / 3 8 . 8 1 . 0 / 8 9 . 5 0 . 2 5 0 . 0 5 / 1 . 2 0 8 . 6 0 . 1 0 9 . 5 8 5 0 0 1 0 0 T r i p I n H o l e D r i l l O u t 15 - S e p 9 0 1 2 1 0 . 6 0 4 8 1 6 1 6 4 / 5 / 6 3 . 2 4 8 / 3 2 / 2 4 / 1 6 / 5 / 4 1 / 2 1 0 . 8 0 . 0 / 8 8 . 0 - 0 . 1 5 / 0 . 6 0 9 . 8 0 . 3 0 - 1 4 5 0 0 1 2 0 D r i l l e d t o C o r e P o i n t 16 - S e p 9 0 1 2 1 0 . 6 0 5 3 1 8 1 7 5 / 8 / 0 3 . 0 5 3 / 3 5 / 2 7 / 1 8 / 5 / 4 1 / 2 1 0 . 8 0 . 0 / 8 8 . 0 - 0 . 1 5 / 0 . 6 0 9 . 8 0 . 3 0 - 1 5 0 0 0 1 2 0 C o r i n g 17 - S e p 9 0 2 8 1 0 . 6 0 5 5 2 1 1 6 4 / 8 / 0 2 . 7 5 8 / 3 7 / 2 9 / 1 9 / 5 / 4 1 / 0 1 0 . 7 0 . 0 / 8 8 . 0 - 0 . 2 0 / 1 . 0 0 1 0 . 1 0 . 4 0 0 . 5 1 6 0 0 0 8 0 P O O H w / C o r e 18 - S e p 9 0 7 3 1 0 . 7 0 5 8 2 4 1 5 4 / 7 / 0 2 . 5 6 3 / 3 9 / 3 0 / 1 9 / 4 / 3 1 / 0 1 0 . 9 0 . 0 / 8 7 . 8 - 0 . 2 0 / 1 . 0 0 1 0 . 2 0 . 4 5 5 . 0 1 7 0 0 0 6 0 C o r i n g 19 - S e p 9 0 8 9 1 0 . 8 5 5 8 2 7 2 0 4 / 8 / 0 2 . 6 7 4 / 4 7 / 3 6 / 2 2 / 5 / 4 1 / 0 1 1 . 7 0 . 0 / 8 7 . 0 - 0 . 2 5 / 1 . 1 0 1 0 . 1 0 . 5 0 5 . 0 1 7 0 0 0 1 0 0 C o r i n g 20 - S e p 9 4 0 5 1 1 . 1 0 5 8 2 5 1 5 4 / 7 / 0 2 . 4 6 5 / 4 0 / 3 0 / 1 8 / 4 / 3 1 / 2 1 3 . 0 0 . 0 / 8 5 . 8 - 0 . 2 5 / 1 . 1 0 1 0 . 1 0 . 5 0 5 . 0 1 7 0 0 0 6 0 D r i l l i n g 21 - S e p 1 0 6 1 1 1 1 . 4 0 5 8 2 9 2 4 4 / 1 4 / 2 5 2 . 4 8 2 / 5 3 / 4 1 / 2 6 / 6 / 5 1 / 0 1 4 . 3 0 . 0 / 8 4 . 5 - 0 . 2 0 / 1 . 0 0 9 . 8 0 . 4 0 9 . 5 1 6 0 0 0 4 0 T r i p p i n g O u t o f H o l e 22 - S e p 1 0 6 1 1 1 1 . 4 0 5 8 2 5 1 6 4 / 8 / 0 2 . 8 6 6 / 4 1 / 3 2 / 2 0 / 4 / 3 1 / 0 1 4 . 3 0 . 0 / 8 4 . 5 - 0 . 2 0 / 0 . 8 0 1 0 . 3 0 . 4 0 3 . 0 1 6 0 0 0 4 0 T r i p p i n g i n h o l e w / c o r e barrel 23 - S e p 1 0 6 3 5 1 1 . 4 0 5 9 2 5 1 6 4 / 1 0 / 1 9 2 . 6 6 6 / 4 1 / 3 1 / 2 0 / 4 / 3 1 / 2 1 4 . 7 0 . 0 / 8 4 . 0 - 0 . 2 0 / 0 . 8 0 1 0 . 5 0 . 4 5 7 . 5 1 7 0 0 0 6 0 C o r i n g 24 - S e p 1 0 6 6 0 1 1 . 6 0 6 3 2 9 1 9 4 / 0 / 0 2 . 4 7 7 / 4 8 / 3 7 / 2 3 / 5 / 4 1 / 2 1 5 . 2 0 . 0 / 8 3 . 5 - 0 . 2 0 / . 0 8 0 1 0 . 3 0 . 4 0 7 . 5 1 8 0 0 0 6 0 C o r i n g a n d t r i p o u t o f hole 25 - S e p 1 0 7 0 6 1 1 . 6 0 6 0 3 0 1 8 6 / 1 2 / 0 2 . 2 7 8 / 4 8 / 3 6 / 2 2 / 5 / 4 1 / 0 1 5 . 4 0 . 0 / 8 3 . 3 - 0 . 2 0 / 0 . 8 0 1 0 . 1 0 . 4 0 7 . 5 1 8 0 0 0 6 0 T r i p o u t o f h o l e w i t h core barrel 26 - S e p 1 0 7 4 8 1 1 . 8 0 6 6 2 6 1 7 5 / 1 1 / 0 2 . 4 6 9 / 4 3 / 3 1 / 2 0 / 5 / 4 1 / 0 1 5 . 6 0 0 / 8 2 . 5 - 0 . 2 0 / 0 . 7 0 1 0 . 2 0 . 4 0 7 . 5 2 6 0 0 0 6 0 C o r i n g a n d t r i p o u t o f hole 27 - S e p 1 0 7 5 3 1 2 . 0 0 5 5 2 5 1 6 4 / 1 0 / 1 9 2 . 6 6 6 / 4 1 / 3 1 / 1 9 / 5 / 4 1 / 3 1 6 . 0 0 . 0 / 8 2 . 5 - 0 . 2 0 / 0 . 7 0 1 0 . 3 0 . 4 0 7 . 5 2 8 0 0 0 6 0 T I H , c o r e d 5 ' , T O O H 28 - S e p 1 0 7 5 3 1 2 . 0 0 6 2 2 6 1 7 5 / 1 2 / 0 2 . 4 6 9 / 4 3 / 3 1 / 1 8 / 5 / 4 1 / 0 1 6 . 0 0 0 / 8 2 - 0 . 2 0 / 0 . 8 0 1 0 . 3 0 . 4 0 7 . 5 2 8 0 0 0 6 0 T O O H , c h a n g e d b i t T I H 29 - S e p 1 0 8 4 3 1 2 . 2 0 5 8 2 6 1 6 5 / 1 1 / 2 0 2 . 4 6 8 / 4 2 / 3 2 / 2 0 / 4 / 3 1 / 0 1 6 . 6 0 0 / 8 1 . 4 - 0 . 2 0 / 0 . 8 0 1 0 . 3 0 . 4 0 7 . 5 2 8 0 0 0 6 0 C o r i n g a n d t r i p o u t o f hole 30 - S e p 1 0 8 4 3 1 2 . 2 0 6 0 2 2 1 5 4 / 1 1 / 1 9 2 . 4 5 9 / 3 7 / 2 8 / 1 8 / 4 / 3 1 / 0 1 6 . 7 0 . 0 / 8 1 . 3 - 0 . 1 5 / 0 . 8 0 1 0 . 0 0 . 3 0 7 . 5 2 8 0 0 0 6 0 T e s t i n g B O P ' s 1- O c t 1 0 8 4 3 1 2 . 2 0 6 1 2 6 2 0 5 / 1 4 / 2 0 2. 4 72 / 4 6 / 3 3 / 2 1 / 5 / 4 1 / 0 1 6 . 7 0 . 0 / 8 1 . 3 - 0. 1 5 / 0 . 8 0 1 0 . 0 0 . 3 0 7 . 5 2 8 0 0 0 6 0 Reaming/wash down hole 2- O c t 10 9 3 3 1 2 . 2 0 6 2 2 7 1 9 4/ 1 5 / 2 4 3. 0 73 / 4 6 / 3 3 / 2 2 / 5 / 4 2 / 0 1 7 . 0 0 . 0 / 8 1 . 1 - 0. 2 0 / 0 . 8 0 1 0 . 2 0 . 4 0 9 . 5 2 7 0 0 0 6 0 Backreaming out of hole 3- O c t 10 9 3 3 1 2 . 2 0 6 2 2 6 1 9 5/ 1 5 / 2 5 3. 0 71 / 4 5 / 3 5 / 2 3 / 6 / 5 1 / 0 1 7 . 1 0 . 0 / 8 1 . 0 - 0. 1 5 / 0 . 8 0 1 0 . 0 0 . 3 0 9 . 5 2 7 5 0 0 6 0 RIH with Quad Combo tools 4- O c t 10 6 7 5 1 2 . 2 0 5 8 3 3 2 2 6/ 1 7 / 2 8 3. 2 8 8 / 5 5 / 4 2 / 2 7 / 6 / 4 2/ 3 17 . 2 0 . 0 / 8 1 . 0 - 0 . 3 0 / 1 . 6 0 9 . 6 0 . 4 0 9 .5 2 6 0 0 0 6 0 R e a m i n g / w a s h d o w n h o l e 5- O c t 11 0 4 3 1 2 . 2 0 5 7 3 6 2 2 6 / 2 3 / 3 0 3. 2 9 4 / 5 8 / 4 6 / 2 9 / 6 / 4 2/ 3 17 . 2 0 . 0 / 8 1 . 0 - 0 . 2 0 / 1 . 2 0 1 0 . 2 0 . 3 0 1 0 2 6 0 0 0 6 0 M A D P a s s Pa g e 1 o f 2 W E L L N A M E : Me r a k 1 LO C A T I O N : Ex p l o r a t i o n OP E R A T O R : Gr e a t B e a r P e t r o l e u m L L C AR E A : No r t h S l o p e MU D C O : Ba r o i d ST A T E : Al a s k a RI G : Na b o r s 1 0 5 SP U D : 22 - A u g - 1 2 SP E R R Y J O B : AK - A M - 0 0 0 9 4 9 8 0 7 1 TD : 5- O c t - 1 2 W a t e r - B a s e d M u d R e c o r d Da t e D e p t h W t V i s P V Y P G e l s F i l t R6 0 0 / R 3 0 0 / R 2 0 0 / R 1 0 0 / R6 / R 3 Ca k e S o l i d s Oi l / W a t e r Sd P f / M f p H P m M B T C h l o r i d e s H a r d n e s s R e m a r k s ft - M D p p g s e c l b / 1 0 0 l b / 1 0 0 f t 2 m / 3 0 m R h e o m e t e r 3 2 n d s % % % l b / g a l m g / L C a + + 6- O c t 11 0 9 4 1 2 . 2 0 5 8 2 6 2 2 6 / 1 9 / 2 5 3. 2 7 4 / 4 8 / 3 5 / 2 2 / 6 / 4 2/ 3 17 . 7 0 . 0 / 8 0 . 5 - 0 . 2 0 / 1 . 2 0 9 . 8 0 .3 0 1 0 2 6 0 0 0 6 0 W i r e L i n e l o g s 7- O c t 11 0 9 4 1 2 . 2 0 6 8 2 9 1 9 5 / 1 7 / 23 3 7 7 / 4 8 / 3 7 / 2 3 / 4 / 3 2/ 3 17 . 5 0 . 0 / 8 0 . 6 - 0 . 2 0 / 1 . 2 0 1 0 . 2 0 . 3 0 1 0 2 7 0 0 0 6 0 T r i p p i n g i n t h e h o l e 8- O c t 11 0 9 4 1 2 . 2 0 5 9 2 9 2 0 5 / 1 7 / 2 5 3. 2 7 8 / 4 9 / 3 8 / 2 3 / 6 / 4 2/ 3 17 . 6 0 . 0 / 8 0 . 6 - 0 . 2 0 / 1 . 4 0 9 . 8 0 . 3 0 1 0 2 5 5 0 0 60 Circulating and Conditioning mud 9- O c t 11 0 9 4 1 2 . 2 0 5 9 2 9 2 1 5 / 2 2 / 2 7 3. 8 7 9 / 5 0 / 3 0 / 2 5 / 5 / 4 2/ 3 17 . 3 0 . 0 / 8 0 . 6 - 0 . 2 0 / 1 . 4 0 10 0 . 3 0 1 0 2 5 0 0 0 8 0 C i r c u l a t i n g a n d C o n d i t i o n i n g m u d 10 - O c t 11 0 9 4 1 2 . 2 0 6 8 3 0 1 9 5 / 1 8 / 2 6 3. 8 7 9 / 4 9 / 3 0 / 2 5 / 5 / 4 2/ 3 17 . 8 0 . 0 / 8 0 . 5 - 0 . 2 0 / 1 . 3 0 1 1 . 1 0 . 3 0 1 0 2 3 5 0 0 8 0 T r i p p i n g i n t h e h o l e 11 - O c t 11 0 9 4 1 2 . 2 0 7 5 3 0 2 0 5 / 2 1 / 28 4 8 0 / 5 0 / 3 7 / 2 5 / 6 / 5 2/ 3 17 . 9 0 . 0 / 8 0 . 5 - 0 . 3 5 / 1 . 5 0 1 2 0 . 40 1 0 2 3 0 0 0 8 0 C u t a n d S l i p D r ill Line Ca s i n g R e c o r d 20 " C o n d u c to r @ 1 1 6 ' M D 13 - 3 / 8 " S u r f a c e @ 2 4 4 1 ' M D 9- 5 / 8 " I n t e r m e d i a t e @ 8 7 2 6 ' M D Pa g e 2 o f 2 Formation/Marker Tops Depth (MD) Depth (TVD) Depth (SSTVD) Gubik 484 484 288 Middle Sagavanirktok 691 691 495 Permafrost 761 761 565 Top Franklin Bluffs Member (Middle Sagavanirktok)1379 1379 1183 Base Frankin Vluffs Member (Middle Sagavanirktok)2046 2046 1850 Mikkelson Tongue (Upper Canning)2046 2046 1850 Lower Sagavanirktok 2566 2566 2370 Staines Tongue (Lower Sagavanirktok)3732 3732 3536 Prince Creek 5520 5520 5324 Upper Schrader Bluff 5892 5892 5696 Campanian Flooding Surface 7258 7258 7062 Middle Schrader Bluff 7261 7261 7065 Lower Canning 7392 7392 7196 MCU (Mid Campanian Unconformity) 8480 8477 8280 Hue Shale 8480 8477 8280 Top HRZ 8954 8947 8750 Base HRZ 9172 9163 8967 Pebble Shale 9172 9163 8967 LCU (Lower Cretaceous Unconformity) 9392 9382 9186 Kuparuk C (Basal Zone) 9392 9382 9186 Kuparuk B 9413 9403 9207 Kuparuk A 9437 9427 9231 Miluveach 9464 9454 9258 Upper Kingak 9650 9639 9443 Lower Kingak 9994 9981 9786 Lower Kingak (K‐1 Top) 10219 10207 10011 Lower Kingak Base 10725 10712 10516 Top Shublik 10725 10712 10516 Base Shublik 10851 10838 10642 Fire Creek 10851 10838 10642 Ivishak 10897 10884 10688 Formation Tops in Black Surface Tops in Blue Merak 1 Geological Tops 19 October, 2012 Great Bear Project Great Bear Merak #1 50-223-20027-00-00 Project: Company: Local Co-ordinate Reference: TVD Reference: Site: Great Bear Petroleum Great Bear Project Great Bear Halliburton Company Definitive Survey Report Well: Wellbore: Plan Merak #1 Merak #1 Survey Calculation Method:Minimum Curvature Actual @ 196.42ft (@ 196.42 (174.7 + 21.72) Design:Merak #1 Rig Surveys Database:.16 prd MD Reference:Actual @ 196.42ft (@ 196.42 (174.7 + 21.72) North Reference: Well Plan Merak #1 True Map System: Geo Datum: Project Map Zone: System Datum:US State Plane 1927 (Exact solution) NAD 1927 (NADCON CONUS) Great Bear Project Alaska Zone 04 Mean Sea Level Using Well Reference Point Using geodetic scale factor Well Well Position Longitude: Latitude: Easting: Northing: ft +E/-W +N/-S Position Uncertainty ft ft ftGround Level: Plan Merak #1 ft ft 0.00 0.00 5,839,739.79 661,410.35 174.70Wellhead Elevation:ft0.00 69° 58' 7.368 N 148° 42' 48.292 W Wellbore Declination (°) Field Strength (nT) Sample Date Dip Angle (°) Merak #1 Model NameMagnetics BGGM2012 8/23/2012 20.75 80.79 57,606 Phase:Version: Audit Notes: Design Merak #1 Rig Surveys 1.0 ACTUAL Vertical Section: Depth From (TVD) (ft) +N/-S (ft) Direction (°) +E/-W (ft) Tie On Depth:21.72 315.000.000.0021.72 From (ft) Survey Program DescriptionTool NameSurvey (Wellbore) To (ft) Date 10/19/2012 Survey Start Date MWD+sag Fixed:v2:standard declination + sag205.22 659.01 Merak #1 Rig Surveys (MWD+sag) (Mera 08/18/2012 MWD+sag Fixed:v2:standard declination + sag755.48 2,416.13 Merak #1 Rig Surveys (MWD + sag) (Me 08/23/2012 MWD+sag Fixed:v2:standard declination + sag2,476.15 8,687.33 Merak #1 Rig Surveys (MWD+sag) (Mer 08/28/2012 MWD+sag Fixed:v2:standard declination + sag8,750.00 10,993.28 Merak #1 Rig Surveys (MWD+sag) (Mera 09/05/2012 MD (ft) Inc (°) Azi (°) +E/-W (ft) +N/-S (ft) Survey TVD (ft) TVDSS (ft) Map Northing (ft) Map Easting (ft) Vertical Section (ft) DLS (°/100')Survey Tool Name 21.72 0.00 0.00 21.72 0.00 0.00-174.70 5,839,739.79 661,410.35 0.00 0.00 UNDEFINED 205.22 0.40 109.63 205.22 -0.22 0.608.80 5,839,739.59 661,410.96 0.22 -0.58 MWD+sag (1) 293.21 0.66 120.50 293.20 -0.58 1.3396.78 5,839,739.24 661,411.69 0.32 -1.35 MWD+sag (1) 387.92 1.20 119.10 387.90 -1.33 2.67191.48 5,839,738.51 661,413.04 0.57 -2.83 MWD+sag (1) 480.14 1.33 123.91 480.10 -2.40 4.40283.68 5,839,737.48 661,414.80 0.18 -4.81 MWD+sag (1) 572.31 1.27 123.87 572.25 -3.57 6.13375.83 5,839,736.35 661,416.56 0.07 -6.86 MWD+sag (1) 659.01 1.69 127.20 658.92 -4.88 7.95462.50 5,839,735.08 661,418.40 0.49 -9.07 MWD+sag (1) 755.48 0.75 115.11 755.36 -6.00 9.65558.94 5,839,733.99 661,420.13 1.00 -11.07 MWD+sag (2) 852.80 0.80 111.29 852.67 -6.52 10.86656.25 5,839,733.50 661,421.35 0.07 -12.29 MWD+sag (2) 948.96 1.24 117.44 948.82 -7.24 12.41752.40 5,839,732.81 661,422.91 0.47 -13.90 MWD+sag (2) 1,042.78 0.15 104.50 1,042.63 -7.74 13.43846.21 5,839,732.33 661,423.94 1.17 -14.97 MWD+sag (2) 10/19/2012 11:47:39AM COMPASS 2003.16 Build 73 Page 2 Project: Company: Local Co-ordinate Reference: TVD Reference: Site: Great Bear Petroleum Great Bear Project Great Bear Halliburton Company Definitive Survey Report Well: Wellbore: Plan Merak #1 Merak #1 Survey Calculation Method:Minimum Curvature Actual @ 196.42ft (@ 196.42 (174.7 + 21.72) Design:Merak #1 Rig Surveys Database:.16 prd MD Reference:Actual @ 196.42ft (@ 196.42 (174.7 + 21.72) North Reference: Well Plan Merak #1 True MD (ft) Inc (°) Azi (°) +E/-W (ft) +N/-S (ft) Survey TVD (ft) TVDSS (ft) Map Northing (ft) Map Easting (ft) Vertical Section (ft) DLS (°/100')Survey Tool Name 1,140.43 0.57 311.45 1,140.28 -7.45 13.19943.86 5,839,732.62 661,423.70 0.72 -14.60 MWD+sag (2) 1,237.27 0.76 320.43 1,237.11 -6.64 12.421,040.69 5,839,733.41 661,422.91 0.22 -13.48 MWD+sag (2) 1,331.49 0.89 324.83 1,331.32 -5.56 11.601,134.90 5,839,734.48 661,422.07 0.15 -12.14 MWD+sag (2) 1,424.86 0.73 291.84 1,424.68 -4.75 10.631,228.26 5,839,735.27 661,421.08 0.52 -10.87 MWD+sag (2) 1,521.09 0.55 296.22 1,520.91 -4.31 9.651,324.49 5,839,735.68 661,420.09 0.19 -9.87 MWD+sag (2) 1,617.23 0.55 303.23 1,617.04 -3.86 8.851,420.62 5,839,736.12 661,419.28 0.07 -8.98 MWD+sag (2) 1,712.85 0.43 298.52 1,712.66 -3.43 8.151,516.24 5,839,736.53 661,418.57 0.13 -8.19 MWD+sag (2) 1,808.37 0.46 297.19 1,808.17 -3.09 7.491,611.75 5,839,736.86 661,417.91 0.03 -7.48 MWD+sag (2) 1,902.82 0.40 283.50 1,902.62 -2.84 6.841,706.20 5,839,737.10 661,417.24 0.13 -6.84 MWD+sag (2) 2,000.03 0.50 291.93 1,999.83 -2.60 6.111,803.41 5,839,737.32 661,416.52 0.12 -6.16 MWD+sag (2) 2,096.67 0.33 288.27 2,096.47 -2.35 5.461,900.05 5,839,737.55 661,415.86 0.18 -5.52 MWD+sag (2) 2,189.37 0.42 293.41 2,189.16 -2.14 4.891,992.74 5,839,737.76 661,415.29 0.10 -4.97 MWD+sag (2) 2,286.29 0.22 285.11 2,286.08 -1.95 4.392,089.66 5,839,737.94 661,414.78 0.21 -4.48 MWD+sag (2) 2,382.70 0.38 256.72 2,382.49 -1.97 3.902,186.07 5,839,737.90 661,414.29 0.22 -4.15 MWD+sag (2) 2,416.13 0.46 300.59 2,415.92 -1.93 3.672,219.50 5,839,737.94 661,414.06 0.96 -3.96 MWD+sag (2) 2,476.15 0.31 269.70 2,475.94 -1.81 3.302,279.52 5,839,738.05 661,413.69 0.42 -3.61 MWD+sag (3) 2,572.53 0.27 237.07 2,572.32 -1.93 2.852,375.90 5,839,737.92 661,413.24 0.17 -3.38 MWD+sag (3) 2,668.57 0.27 225.36 2,668.36 -2.21 2.502,471.94 5,839,737.63 661,412.90 0.06 -3.33 MWD+sag (3) 2,762.54 0.36 223.57 2,762.33 -2.58 2.142,565.91 5,839,737.25 661,412.54 0.10 -3.34 MWD+sag (3) 2,859.05 0.29 243.52 2,858.84 -2.91 1.712,662.42 5,839,736.92 661,412.12 0.14 -3.27 MWD+sag (3) 2,954.96 0.37 224.35 2,954.75 -3.24 1.282,758.33 5,839,736.58 661,411.70 0.14 -3.20 MWD+sag (3) 3,051.08 0.35 242.08 3,050.86 -3.60 0.802,854.44 5,839,736.21 661,411.23 0.12 -3.11 MWD+sag (3) 3,147.07 0.31 234.82 3,146.85 -3.89 0.332,950.43 5,839,735.91 661,410.76 0.06 -2.98 MWD+sag (3) 3,241.90 0.37 215.93 3,241.68 -4.28 -0.063,045.26 5,839,735.51 661,410.38 0.13 -2.99 MWD+sag (3) 3,338.63 0.44 230.17 3,338.41 -4.77 -0.533,141.99 5,839,735.01 661,409.92 0.13 -3.00 MWD+sag (3) 3,433.80 0.46 207.29 3,433.58 -5.35 -0.983,237.16 5,839,734.42 661,409.48 0.19 -3.09 MWD+sag (3) 3,527.21 0.46 225.29 3,526.98 -5.94 -1.423,330.56 5,839,733.82 661,409.06 0.15 -3.20 MWD+sag (3) 3,628.46 0.49 218.68 3,628.23 -6.57 -1.983,431.81 5,839,733.18 661,408.51 0.06 -3.25 MWD+sag (3) 3,719.73 0.51 231.61 3,719.50 -7.13 -2.543,523.08 5,839,732.61 661,407.96 0.13 -3.24 MWD+sag (3) 3,816.40 0.59 225.83 3,816.16 -7.74 -3.243,619.74 5,839,731.98 661,407.28 0.10 -3.18 MWD+sag (3) 3,910.83 0.68 219.79 3,910.59 -8.51 -3.943,714.17 5,839,731.20 661,406.59 0.12 -3.23 MWD+sag (3) 4,007.62 0.70 220.09 4,007.37 -9.40 -4.693,810.95 5,839,730.29 661,405.86 0.02 -3.33 MWD+sag (3) 4,102.29 0.71 224.57 4,102.03 -10.26 -5.483,905.61 5,839,729.41 661,405.09 0.06 -3.39 MWD+sag (3) 4,197.60 0.71 220.92 4,197.33 -11.13 -6.284,000.91 5,839,728.53 661,404.31 0.05 -3.43 MWD+sag (3) 4,294.41 0.79 216.96 4,294.14 -12.12 -7.074,097.72 5,839,727.53 661,403.54 0.10 -3.57 MWD+sag (3) 4,389.95 0.51 201.65 4,389.67 -13.04 -7.624,193.25 5,839,726.60 661,403.00 0.34 -3.83 MWD+sag (3) 4,485.57 0.55 196.80 4,485.29 -13.87 -7.914,288.87 5,839,725.75 661,402.73 0.06 -4.21 MWD+sag (3) 4,581.52 0.57 218.74 4,581.23 -14.69 -8.354,384.81 5,839,724.93 661,402.32 0.22 -4.48 MWD+sag (3) 4,676.26 1.06 12.43 4,675.97 -14.20 -8.454,479.55 5,839,725.42 661,402.20 1.68 -4.06 MWD+sag (3) 4,771.61 1.57 17.43 4,771.29 -12.09 -7.874,574.87 5,839,727.54 661,402.74 0.55 -2.98 MWD+sag (3) 10/19/2012 11:47:39AM COMPASS 2003.16 Build 73 Page 3 Project: Company: Local Co-ordinate Reference: TVD Reference: Site: Great Bear Petroleum Great Bear Project Great Bear Halliburton Company Definitive Survey Report Well: Wellbore: Plan Merak #1 Merak #1 Survey Calculation Method:Minimum Curvature Actual @ 196.42ft (@ 196.42 (174.7 + 21.72) Design:Merak #1 Rig Surveys Database:.16 prd MD Reference:Actual @ 196.42ft (@ 196.42 (174.7 + 21.72) North Reference: Well Plan Merak #1 True MD (ft) Inc (°) Azi (°) +E/-W (ft) +N/-S (ft) Survey TVD (ft) TVDSS (ft) Map Northing (ft) Map Easting (ft) Vertical Section (ft) DLS (°/100')Survey Tool Name 4,868.13 1.58 17.62 4,867.77 -9.56 -7.074,671.35 5,839,730.08 661,403.48 0.01 -1.76 MWD+sag (3) 4,967.66 1.58 17.07 4,967.27 -6.94 -6.254,770.85 5,839,732.72 661,404.24 0.02 -0.49 MWD+sag (3) 5,059.71 1.60 16.57 5,059.28 -4.50 -5.514,862.86 5,839,735.18 661,404.93 0.03 0.72 MWD+sag (3) 5,155.87 1.09 5.16 5,155.41 -2.30 -5.054,958.99 5,839,737.39 661,405.35 0.60 1.95 MWD+sag (3) 5,250.98 1.05 7.41 5,250.51 -0.53 -4.865,054.09 5,839,739.15 661,405.51 0.06 3.06 MWD+sag (3) 5,347.19 0.81 24.77 5,346.71 0.96 -4.465,150.29 5,839,740.65 661,405.87 0.38 3.83 MWD+sag (3) 5,443.81 0.84 93.27 5,443.32 1.54 -3.465,246.90 5,839,741.25 661,406.85 0.96 3.54 MWD+sag (3) 5,539.58 0.84 83.88 5,539.08 1.57 -2.075,342.66 5,839,741.32 661,408.25 0.14 2.57 MWD+sag (3) 5,637.34 0.82 95.80 5,636.83 1.58 -0.665,440.41 5,839,741.35 661,409.66 0.18 1.58 MWD+sag (3) 5,731.28 0.82 90.17 5,730.76 1.51 0.685,534.34 5,839,741.31 661,411.00 0.09 0.58 MWD+sag (3) 5,827.48 0.83 100.25 5,826.95 1.38 2.065,630.53 5,839,741.22 661,412.38 0.15 -0.48 MWD+sag (3) 5,923.32 0.82 83.65 5,922.78 1.33 3.425,726.36 5,839,741.20 661,413.74 0.25 -1.48 MWD+sag (3) 6,018.45 0.79 89.08 6,017.90 1.42 4.765,821.48 5,839,741.31 661,415.07 0.09 -2.36 MWD+sag (3) 6,116.64 0.60 251.70 6,116.09 1.27 4.945,919.67 5,839,741.16 661,415.27 1.40 -2.60 MWD+sag (3) 6,209.50 0.82 255.20 6,208.94 0.95 3.846,012.52 5,839,740.82 661,414.17 0.24 -2.05 MWD+sag (3) 6,305.63 0.88 247.54 6,305.06 0.49 2.496,108.64 5,839,740.33 661,412.83 0.13 -1.42 MWD+sag (3) 6,401.70 0.79 246.95 6,401.12 -0.05 1.206,204.70 5,839,739.76 661,411.55 0.09 -0.89 MWD+sag (3) 6,497.54 0.76 241.08 6,496.95 -0.62 0.046,300.53 5,839,739.17 661,410.40 0.09 -0.46 MWD+sag (3) 6,593.78 0.77 241.61 6,593.18 -1.23 -1.096,396.76 5,839,738.53 661,409.29 0.01 -0.10 MWD+sag (3) 6,688.62 0.83 247.81 6,688.01 -1.80 -2.296,491.59 5,839,737.95 661,408.10 0.11 0.35 MWD+sag (3) 6,783.74 0.82 247.83 6,783.12 -2.31 -3.566,586.70 5,839,737.40 661,406.84 0.01 0.88 MWD+sag (3) 6,879.13 0.84 251.69 6,878.50 -2.79 -4.856,682.08 5,839,736.90 661,405.56 0.06 1.46 MWD+sag (3) 6,974.46 0.78 252.32 6,973.82 -3.21 -6.136,777.40 5,839,736.45 661,404.29 0.06 2.07 MWD+sag (3) 7,069.90 0.89 249.07 7,069.25 -3.67 -7.446,872.83 5,839,735.97 661,402.99 0.13 2.67 MWD+sag (3) 7,166.22 0.90 257.03 7,165.56 -4.11 -8.886,969.14 5,839,735.50 661,401.56 0.13 3.38 MWD+sag (3) 7,260.54 0.76 262.84 7,259.87 -4.35 -10.227,063.45 5,839,735.23 661,400.22 0.17 4.15 MWD+sag (3) 7,357.34 0.85 273.49 7,356.66 -4.39 -11.587,160.24 5,839,735.16 661,398.87 0.18 5.08 MWD+sag (3) 7,453.71 1.03 285.29 7,453.02 -4.11 -13.137,256.60 5,839,735.40 661,397.32 0.27 6.37 MWD+sag (3) 7,548.95 1.13 290.38 7,548.24 -3.56 -14.837,351.82 5,839,735.92 661,395.60 0.15 7.97 MWD+sag (3) 7,646.60 0.86 299.00 7,645.88 -2.87 -16.377,449.46 5,839,736.57 661,394.04 0.32 9.55 MWD+sag (3) 7,740.99 0.22 290.00 7,740.26 -2.47 -17.167,543.84 5,839,736.96 661,393.24 0.68 10.39 MWD+sag (3) 7,836.58 0.43 303.43 7,835.85 -2.21 -17.647,639.43 5,839,737.21 661,392.77 0.23 10.91 MWD+sag (3) 7,932.33 0.60 311.72 7,931.60 -1.67 -18.317,735.18 5,839,737.73 661,392.08 0.19 11.76 MWD+sag (3) 8,027.48 0.89 329.92 8,026.74 -0.70 -19.057,830.32 5,839,738.69 661,391.32 0.39 12.98 MWD+sag (3) 8,123.65 1.71 329.47 8,122.88 1.18 -20.167,926.46 5,839,740.54 661,390.18 0.85 15.09 MWD+sag (3) 8,219.23 3.72 335.07 8,218.35 5.22 -22.198,021.93 5,839,744.54 661,388.06 2.12 19.38 MWD+sag (3) 8,315.30 6.59 330.64 8,314.02 12.85 -26.208,117.60 5,839,752.09 661,383.88 3.01 27.62 MWD+sag (3) 8,409.62 7.97 329.63 8,407.58 23.21 -32.168,211.16 5,839,762.32 661,377.71 1.47 39.16 MWD+sag (3) 8,505.46 9.18 330.28 8,502.35 35.58 -39.318,305.93 5,839,774.53 661,370.30 1.27 52.96 MWD+sag (3) 8,601.96 8.67 329.33 8,597.68 48.53 -46.848,401.26 5,839,787.31 661,362.50 0.55 67.43 MWD+sag (3) 10/19/2012 11:47:39AM COMPASS 2003.16 Build 73 Page 4 Project: Company: Local Co-ordinate Reference: TVD Reference: Site: Great Bear Petroleum Great Bear Project Great Bear Halliburton Company Definitive Survey Report Well: Wellbore: Plan Merak #1 Merak #1 Survey Calculation Method:Minimum Curvature Actual @ 196.42ft (@ 196.42 (174.7 + 21.72) Design:Merak #1 Rig Surveys Database:.16 prd MD Reference:Actual @ 196.42ft (@ 196.42 (174.7 + 21.72) North Reference: Well Plan Merak #1 True MD (ft) Inc (°) Azi (°) +E/-W (ft) +N/-S (ft) Survey TVD (ft) TVDSS (ft) Map Northing (ft) Map Easting (ft) Vertical Section (ft) DLS (°/100')Survey Tool Name 8,687.33 8.07 330.88 8,682.14 59.29 -53.048,485.72 5,839,797.95 661,356.08 0.75 79.43 MWD+sag (3) 8,781.38 7.74 332.25 8,775.29 70.67 -59.208,578.87 5,839,809.19 661,349.68 0.40 91.83 MWD+sag (4) 8,877.25 7.22 333.97 8,870.35 81.79 -64.858,673.93 5,839,820.19 661,343.79 0.59 103.69 MWD+sag (4) 8,973.57 6.54 337.36 8,965.97 92.30 -69.628,769.55 5,839,830.59 661,338.81 0.82 114.49 MWD+sag (4) 9,070.51 6.48 336.05 9,062.29 102.39 -73.968,865.87 5,839,840.59 661,334.25 0.17 124.70 MWD+sag (4) 9,162.59 6.36 335.60 9,153.79 111.78 -78.188,957.37 5,839,849.89 661,329.84 0.14 134.32 MWD+sag (4) 9,256.81 5.56 335.58 9,247.50 120.69 -82.229,051.08 5,839,858.71 661,325.61 0.85 143.48 MWD+sag (4) 9,355.27 5.22 334.91 9,345.53 129.09 -86.099,149.11 5,839,867.03 661,321.56 0.35 152.16 MWD+sag (4) 9,451.76 4.21 334.58 9,441.69 136.26 -89.489,245.27 5,839,874.13 661,318.03 1.05 159.62 MWD+sag (4) 9,546.61 3.98 333.26 9,536.30 142.35 -92.459,339.88 5,839,880.15 661,314.92 0.26 166.03 MWD+sag (4) 9,640.62 3.98 333.34 9,630.08 148.18 -95.389,433.66 5,839,885.91 661,311.87 0.01 172.22 MWD+sag (4) 9,736.66 3.86 331.15 9,725.90 153.99 -98.449,529.48 5,839,891.66 661,308.69 0.20 178.49 MWD+sag (4) 9,834.22 3.74 329.64 9,823.24 159.61 -101.639,626.82 5,839,897.21 661,305.38 0.16 184.73 MWD+sag (4) 9,927.04 3.71 328.57 9,915.86 164.78 -104.739,719.44 5,839,902.32 661,302.18 0.08 190.57 MWD+sag (4) 10,025.79 3.54 330.01 10,014.42 170.15 -107.929,818.00 5,839,907.62 661,298.88 0.20 196.62 MWD+sag (4) 10,117.76 3.41 329.16 10,106.22 174.96 -110.749,909.80 5,839,912.36 661,295.95 0.15 202.02 MWD+sag (4) 10,213.98 3.39 332.08 10,202.27 179.93 -113.5410,005.85 5,839,917.27 661,293.05 0.18 207.51 MWD+sag (4) 10,312.43 3.30 333.15 10,300.55 185.03 -116.1810,104.13 5,839,922.31 661,290.30 0.11 212.99 MWD+sag (4) 10,408.97 3.21 332.43 10,396.94 189.90 -118.6910,200.52 5,839,927.14 661,287.69 0.10 218.21 MWD+sag (4) 10,501.20 3.21 331.28 10,489.02 194.46 -121.1210,292.60 5,839,931.64 661,285.16 0.07 223.15 MWD+sag (4) 10,560.93 3.21 331.64 10,548.66 197.40 -122.7210,352.24 5,839,934.54 661,283.50 0.03 226.36 MWD+sag (4) 10,577.79 3.32 332.40 10,565.49 198.24 -123.1710,369.07 5,839,935.38 661,283.03 0.70 227.27 MWD+sag (4) 10,673.10 3.03 336.24 10,660.65 203.00 -125.4610,464.23 5,839,940.08 661,280.64 0.38 232.26 MWD+sag (4) 10,767.67 3.06 336.16 10,755.09 207.59 -127.4910,558.67 5,839,944.63 661,278.52 0.03 236.94 MWD+sag (4) 10,865.00 3.35 335.85 10,852.27 212.56 -129.7010,655.85 5,839,949.56 661,276.20 0.30 242.02 MWD+sag (4) 10,959.55 2.44 356.84 10,946.70 217.09 -130.9510,750.28 5,839,954.06 661,274.86 1.46 246.10 MWD+sag (4) 10,993.28 2.64 0.62 10,980.40 218.59 -130.9810,783.98 5,839,955.55 661,274.80 0.77 247.18 MWD+sag (4) 11,094.00 2.64 0.62 11,081.01 223.23 -130.9310,884.59 5,839,960.19 661,274.75 0.00 250.42 PROJECTED to TD 10/19/2012 11:47:39AM COMPASS 2003.16 Build 73 Page 5 0 1000 2000 3000 4000 5000 6000 7000 8000 9000 10000 11000 12000 13000 14000 15000 0 4 8 12 16 20 24 28 32 36 40 44 48 52 56 60 64 Me a s u r e d D e p t h Rig Days Prognosed Actual Merak 1 Days vs. Depth Sperry SDL Released 13 Oct 2012 Sperry SDL Arrived on Location 19 August 2012 SDL Services Online 20 August 2012 Set 9 5/8" Casing 8726.6' MD, 8720' TVD 10 Sept 2012 Commenced 16" Surface Hole Section On Bot: 02:00 22 Aug 2012 Commenced 12.25" Intermediate Hole Section On Bot: 13:25 29 Aug 2012 TD 16" Surface Hole Section 2462' MD, 2462' TVD Off Bot: 14:20 24 Aug 2012 TD 12.25" Intermediate Hole Section 8750' MD, 8682' TVD Off Bot: 19:05 04 Sept 2012 Set 13 3/8" Casing 2441' MD, 2441' TVD 26 Aug 2012 TD 8.5" Production Hole Section 11094' MD, 11080' TVD Off Bot: 09:50 05 OCt 2012 Commenced 8.5" Production Hole Section On Bot: 03:05 15 Sept 2012 Core #1 9012' MD - 9028' MD 17 Sept 2012 Core #2 9028' MD - 9089' MD 19 Sept 2012 Core #3 10611' MD - 10660' MD 23 Sept 2012 Pump Cement Plugs 09 Oct 2012Core #4 10660' MD - 10748' MD 25-26 Sept 2012 Core #5 10748' MD - 10753' MD 27 Sept 2012 Core #6 10753' MD - 10843' MD 29 Sept 2012 Core #7 10843' MD - 10933' MD 02 Oct 2012 Surface Data Logging After Action Review Employee Name: Jessica Munsell Date: 10/10/2012 Well: Merak 1 Hole Section: Production What went as, or better than, planned: No major failures or data interruptions. Difficulties experienced: We had a small issue with our air compressor over heating. It was placed into its insulated box that we use for very cold weather. We took the compressor out of the box and let it set for awhile. Once it cooled off it started right back up and we have had no problems with it since. We also had a IMOD PROC error come up on out IRIS machine and also on the MWD primary computer which tracks depth. The driller was called immediately to stop drilling and to circulate while the problem was fixed. In the case of the MWD computer, geometry had become corrupted and had to be deleted and re-entered. For IRIS, all the configurations had to be deleted and new ones entered. This was accomplished in less than a half an hour and we did not have the error come up again. Now that it is beginning to freeze outside, we had some issues with our gas line freezing. We are able to fix this by putting some antifreeze in the line and blowing air through it and the ice will come lose from the line. We try and prevent this problem by blowing air through the line once every hour, but sometimes that still does not stop the line from freezing. Recommendations: With the weather this time of year, getting colder and then warming up again, it’s a good idea to either leave the air compressor out of its box, or leave the lid open so that it does not over heat. Make sure to have our heated gas line on location at all times, wether its cold or not, so we can avoid problems with it suddenly getting cold and our gas lines freezing. Innovations and/or cost savings: Having a buddy box just for SDL has saved a lot of our sample supplies from being ruined by the weather. Surface Data Logging After Action Review Employee Name: Charles Sinn / Matthew Smith Date: 09/13/2012 Well: Merak 1 Hole Section: Surface/Intermediate What went as, or better than, planned: The rig up of this job went much more smoothly than the previous well. We were called to location and given two days to rig up which allowed for testing and rigging up all equipment as well as helping others with networking issues. No failures on our side occurred and all operations during drilling went smoothly. Difficulties experienced: We have had a few problems with Canrig's Rigwatch software/sensors. The Canrig personnel out here are considered geologists and not technicians. At Canrig there is a complete divide between a technician and a mudlogger so when it came to any kind of troubleshooting issues it was very difficult to get a fix from Canrig. We have learned a great deal about their software functions and fixing WITs on their side out of necessity for our client's success. Recommendations: Either we should have all Halliburton systems and sensors on the rig or Canrig should have a dedicated technician on the slope which they do not. All of their technicians are in the Cook Inlet at the moment and will be there for the foreseeable future. Innovations and/or cost savings: We fixed a heat sealer without having to replace the whole device and have procured all of our needed supplies from our storage units on the slope.
