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Home My WebLink AboutCO 207 BCONSERVATION ORDER NO. 2078 Docket Number: CO -16-018 and AIO-16-042 Prudhoe Bay Unit Lisburne Oil Pool North Slope Borough, Alaska 1. September 26, 2016 BP Exploration (Alaska), Inc. request to amend its prior orders to authorize continued GCWI into the Lisburne Oil Pool 2. September 30, 2016 Notice of public hearing, affidavit of publication, email distribution, mailings 3. March 14, 2019 BPXA request for spacing exception L5-03 ((CO207B.001) 4. March 19, 2019 BPXA request for spacing exception L5-27 ((CO207B.002) ORDERS • STATE OF ALASKA 41 ALASKA OIL AND GAS CONSERVATION COMMISSION 333 West 711 Avenue Anchorage, Alaska 99501 Re: THE APPLICATION OF BP Exploration (Alaska) Inc. to convert the pilot gas -cap water injection project to a permanent project. IT APPEARING THAT: Docket Number: CO-16-018 and AIO-16-042 Conservation Order 207B Prudhoe Bay Unit Lisburne Oil Pool North Slope Borough, Alaska January 26, 2017 1. By a letter received September 26, 2016, BP Exploration (Alaska) Inc. (BPXA) requested a conservation order and an area injection order authorizing continued gas -cap water injection (GCWI) into the Lisburne Oil Pool (LOP) for the purpose of enhancing recovery. On its own motion the Alaska Oil and Gas Conservation Commission (AOGCC) proposes to add an administrative action rule. 2. Pursuant to 20 AAC 25.540, the AOGCC tentatively scheduled a public hearing for November 3, 2016. On September 29, 2016, the AOGCC published notice of the opportunity for that hearing on the State of Alaska's Online Public Notice website and on the AOGCC's website, and electronically transmitted the notice to all persons on the AOGCC's email distribution list. On September 30, 2016, the AOGCC published the notice in the ALASKA DISPATCH NEWS and mailed printed copies of the notice to all persons on the AOGCC's mailing distribution list. 3. No comments were received, no one requested that the hearing be held, and the AOGCC determined it had sufficient information to act upon the request so the hearing was vacated on October 24, 2016. BPXA is the operator and a working interest owner (WIO) of the Prudhoe Bay Unit (PBU). Other WIOs include ConocoPhillips Alaska, Inc., ExxonMobil Alaska, Production Inc., and Chevron USA. 2. On June 4, 2008, the AOGCC issued administrative approval CO 207A.00I and AIO 4E.029, which authorized a pilot GCWI project for the LOP involving the injection of water into the PBU L5-29 well and monitoring the performance of offset wells. This Administrative approval was set to expire on July 1, 2011, but on June 17, 2011, the AOGCC issued administrative approval CO 207A.002 and AIO 4E.038, which extended the expiration date to July 1, 2016. 3. During the pilot GCWI project, BPXA injected approximately 22.1 million barrels of water into the PBU L5-29 well. This raised the average reservoir pressure in the pilot project area by approximately 300 psi. 4. Results in the offset wells have been mixed. Some wells saw increased production or suppressed decline and lowering of the gas oil ratio, while other wells that have seen water breakthrough have experienced decreased production due to increased water cut or production downtime associated with formation of gas hydrates. 5. BPXA estimates that the net benefit of LOP GCWI is on the order of 100 to 350 barrels of oil per day and 0.5 to 3 million stock tank barrels increase in ultimate recovery. These results are less than originally anticipated, and have resulted in the WIOs deciding that GCWI is viable for the LOP but does not warrant being expanded beyond the existing PBU L5-29 well. CO 207B • • January 26, 2017 Page 2 of 7 6. CO 207 was issued on January 10, 1985, and contains a rule specific to hydrogen sulfide measures. The AOGCC revised its hydrogen sulfide regulations in 1999. 7. CO 207 and 207A lack an administrative action rule, which is a standard rule in more recent AOGCC orders. CONCLUSIONS: 1. The LOP GCWI pilot project has shown that the concept is feasible and that overall it has increased daily production rates and should increase ultimate recovery. 2. Converting the LOP GCWl project from a pilot project to a permanent project will minimize waste and increase ultimate recovery. 3. Changes to area injection order 4F are not necessary in order to carry out continued GCWI at the LOP. 4. The AOGCC regulations on hydrogen sulfide operations provide adequate protection and a pool specific rule is no longer necessary. 5. The addition of an administrative action rule will aid in the proper oversight and development of the LOP. NOW THEREFORE IT IS ORDERED: Development and operation of the Lisburne Oil Pool are subject to the following rules and the statewide requirements under 20 AAC 25 to the extent not superseded by these rules. This order supersedes conservation orders 207 and 207A and all of their associated administrative approvals, except for CO 207.1. The records of those orders and approvals are incorporated by reference into this order. AFFECTED AREA: UMIAT MERIDIAN T10N, R13E Sections 1, 2, 3, 10, 11, and 12. TION, R14E Sections 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 35, and 36. TION, R15E All. T10N, R16E All. T10N, R17E Sections 3, 4, 5, 6, 7, 8, 9, 10, 15, 16, 17, 18, 19, 20, 21, 22, 27, 28, 29, 30, 31, 32, 33, and 34. THN, R13E Sections 1, 2, 3, 4, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35, and 36. THN, R14E All. THN, R15E All. THN, R16E All. CO 207B • • January 26, 2017 Page 3 of 7 T11N, R17E Sections 3, 4, 5, 6, 7, 8, 9, 10, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35, and 36. T12N, R13E Sections 35 and 36. T12N, R14E Sections 13, 14, 15, 16, 21, 22, 23, 24, 25, 26, 27, 28, 31, 32, 33, 34, 35, and 36. T12N R15E Sections 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35, and 36. T12N, R16E Sections 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35, and 36. Rule 1. FIELD AND POOL NAME (Source: CO 207) The field is the Prudhoe Bay Field and the pool is the Lisburne Oil Pool. Rule 2. POOL DEFINITION (Source: CO 207) The Lisburne Oil Pool is defined as the accumulations of oil and gas which occur in stratigraphic sections which correlate with the stratigraphic section found in the Atlantic Richfield -Humble Prudhoe Bay State No. 1 well between the depths of 8,790 feet measured depth and 10,440 feet measured depth. Rule 3. WELL SPACING (Source: CO 207) The well spacing unit shall be one producing well per governmental quarter section. No pay may be opened in a well closer than 1,000 feet to the pay opened in another well or opened in a well which is closer than 500 feet to the boundary of the affected area. Rule 4. CASING AND CEMENTING (Source: CO 207, Revised: CO 207.2) a) A conductor casing shall be set at least 75 feet below the surface and sufficient cement shall be used to fill the annulus behind the pipe to the surface. Rigid high density polyurethane foam may be used as an alternate to cement, upon approval by the Commission. The Commission may also administratively approve other sealing materials which are supported by sound engineering principles and performance data. b) Surface casing to provide proper anchorage for equipment to prevent uncontrolled flow, to withstand anticipated interval pressure and to protect the well from the effects of permafrost thaw -subsidence or freeze back loadings shall be set at least 500 feet, measured depth, below the base of the permafrost but not below 5000 feet true vertical depth. Sufficient cement shall be used to fill the annulus behind the casing to the surface. c) Surface casing types and grades approved for use through the permafrost interval include: CO 207B • January 26, 2017 Page 4 of 7 1) 13-3/8 inch, 72 pounds/foot, L-80 Buttress; 2) 13-3/8 inch, 72 pounds/foot, N-80 Buttress; 3) 13-3/8 inch, 68 pounds/foot, MN-80 Buttress; and 4)13-3/8 inch, 68 pounds/foot, K-55 d) The Commission may administratively approve additional types and grades of surface casing through the permafrost interval upon a showing that the proposed casing and connection can withstand the permafrost thaw -subsidence and freeze back loadings which may be experienced. Evidence submitted to the Commission shall include: 1) full scale tension and compression testing: or 2) finite element model studies: or 3) other types of axial strain data acceptable to the Commission. e) Alternate casing programs may be administratively approved by the Commission upon application and presentation of data which show the alternatives are appropriate, based upon accepted engineering principles. Rule 5. COMPLETION PRACTICES (Source: CO 207). Wells completed for production may utilize casing strings or liners cemented through the productive intervals and perforated, slotted liners, screen -wrapped liners, gravel packs or open hole methods, or combinations thereof. The Commission may administratively approve alternate completion methods where appropriate. Rule 6. HYDROGEN SULFIDE (Rescinded this Order). Rule 7. AUTOMATIC SHUT-IN EQUIPMENT (Rescinded by Other Order No. 66) Rule 8. GAS VENTING OR FLARING (Source: CO 207) a) The venting or flaring of gas is prohibited except for operational necessities and for safety volumes set out in this rule; b) A daily average volume of 1,000 MCF per day is approved for the safety flare at the Lisburne Production Center; c) Volumes of gas to provide safety flares for additional facilities may be approved by administrative order upon proper application; d) The volumes of gas for safety flares may be decreased or increased by administrative order; and e) Gas flaring may be approved by administrative order during commissioning of new equipment, purging, and start-ups after major repairs or interruptions. Rule 9. GAS -OIL RATIO TESTS (Source: CO 207) a) Between 90 and 120 days after regular production commences and each six months thereafter a gas -oil ratio test will be taken on each well for as long as it produces oil; CO 207B • . January 26, 2017 Page 5 of 7 b) The gas -oil ratio tests will be for a minimum of four hours and shall be taken at the normal producing rate of the well; and c) The results of the gas -oil ratio tests will be reported on Form 10-409, Gas -Oil Ratio Test and will be submitted in January and July of each year. Rule 10. PRESSURE SURVEYS (Source: CO 207, Revised CO 207.11). a) All new wells shall have an acceptable pressure survey, as defined in part (c), taken prior to regular production or injection. b) One pressure survey per producing drillsite per year shall be taken. Pressure surveys from producing or water and gas injection wells may be used for this pressure requirement. Pressure surveys covered in section (a) may be substituted for a drillsite pressure. c) Acceptable pressure surveys include static surveys, RFT/FMT, pressure buildup and falloff tests, and multi -rate pressure transient tests in production or injection wells. Other quantitative methods may be administratively approved by the Commission. d) The pressure datum for the Lisburne Oil Pool is 8900 feet subsea. The Commission may administratively amend this datum or create an additional datum when more information is available on the reservoir. e) Data from the pressure surveys, along with additional pressure data obtained through proper management of the reservoir, shall be filed on form 10-412 by the last day of the month following the month that the pressure survey was obtained. Submitted pressure data shall include other information as necessary such as rate, time, depth, temperature, and well conditions to allow for a complete analysis of the pressure survey. f) The operator shall schedule an annual meeting with the Commission to review the pressure monitoring program and discus future plans for reservoir management. Rule 11. UNITIZATION (Source: CO 207) To ensure the protection of correlative rights and to prevent waste, the Lisburne Oil Pool shall be administered in accordance with the Prudhoe Bay Unit Agreement. Rule 12. PILOT PROJECTS (Source: CO 207) Upon application, the Commission may administratively approve field pilot projects, well production and injection tests and other filed operations necessary for the purpose of developing a prudent enhanced recovery method and reservoir depletion program. Rule 13. POOL OFFTAKE RATE (Source: CO 207) No more than 160,000 barrels of oil per day may be produced from the Lisburne Oil Pool. However when evidence can be presented to the Commission showing that a higher offtake rate will not affect ultimate recovery, the Commission may increase the daily offtake rate by administrative order. Rule 14. CONSERVATION ORDER NO.83-C (Source: CO 207) CO 207B . • January 26, 2017 Page 6 of 7 Conservation Order No. 83-C is hereby cancelled. Rule 15. ANNULAR PRESSURES (Source: CO 492, Revised by: CO 207.17) a) The operator shall conduct and document a pressure test of tubulars and completion equipment in each development well at the time of installation or replacement that is sufficient to demonstrate that planned well operations will not result in failure of well integrity, uncontrolled release of fluid or pressure, or threat to human safety. b) The operator shall monitor each development well daily to check for sustained pressure, except if prevented by extreme weather conditions, emergency situations, or similar unavoidable circumstances. Monitoring results shall be made available for AOGCC inspection. c) The operator shall notify the AOGCC within three working days after the operator identifies a well as having (a) sustained inner annulus pressure that exceeds 2500 psig for wells processed through the Lisburne Processing Center and 2000 psig for all other development wells, or (b) sustained outer annulus pressure that exceeds 1000 psig. d) The AOGCC may require the operator to submit in an Application for Sundry Approvals (Form 10-403) a proposal for corrective action or increased surveillance for any development well having sustained pressure that exceeds a limit set out in paragraph 3 of this rule. The AOGCC may approve the operator's proposal or may require other corrective action or surveillance. The AOGCC may require that corrective action be verified by mechanical integrity testing or other AOGCC approved diagnostic tests. The operator shall give AOGCC sufficient notice of the testing schedule to allow AOGCC to witness the tests. e) If the operator identifies sustained pressure in the inner annulus of a development well that exceeds 45% of the burst pressure rating of the well's production casing for inner annulus pressure, or sustained pressure in the outer annulus that exceeds 45% of the burst pressure rating of the well's surface casing for outer annulus pressure, the operator shall notify the AOGCC within three working days and take corrective action. Unless well conditions require the operator to take emergency corrective action before AOGCC approval can be obtained, the operator shall submit in an Application for Sundry Approvals (Form 10-403) a proposal for corrective action. The AOGCC may approve the operator's proposal or may require other corrective action. The AOGCC may also require that corrective action be verified by mechanical integrity testing or other AOGCC approved diagnostic tests. The operator shall give AOGCC sufficient notice of the testing schedule to allow AOGCC to witness the tests. f) Except as otherwise approved by the AOGCC under paragraph 4 or 5 of this rule, before a shut- in well is placed in service, any annulus pressure must be relieved to a sufficient degree (a) that the inner annulus pressure at operating temperature will be below 2500 psig for wells processed through the Lisburne Production Center and below 2000 prig for all other development wells, and (b) that the outer annulus pressure at operating temperature will be below 1000 psig. However, a well that is subject to paragraph 3, but not paragraph 5, of these rules may reach an annulus pressure at operating temperature that is described in the operator's notification to the AOGCC under paragraph 3, unless the AOGCC prescribes a different limit. g) For purposes of these rules, "inner annulus" means the space in a well between tubing and production casing; "outer annulus" means the space in a well between production casing and surface casing; "sustained pressure" means pressure that (a) is measurable at the casing head of an annulus, (b) is not caused solely by temperature fluctuations, and (c) is not pressure that has been applied intentionally. CO 207B January 26, 2017 Page 7 of 7 Rule 16. GAS -CAP WATER INJECTION PROJECT (New this order) a) Water injection is authorized into Well L5-29 only and is limited to perforations within the upper Wahoo Formation (Zone 6) between the measured depths of 13,585' and 13,634'; b) The Well L5-29 injection rate is limited to 20,000 barrels of water injected per day; and c) Injection pressures must be maintained below 0.55 psi/ft. Rule 17. ADMINISTRATIVE ACTION (New this order) Upon proper application, or its own motion, and unless notice and public hearing are otherwise required, the Commission my administratively waive the requirements of any rule stated herein or administratively amend this order as long as the change does not promote waste or jeopardize correlative rights, is based on sound engineering and geoscience principles, and will not result in an increased risk of fluid movement i freshwater aquifers. c�IG DONE at Anchorage Alaska and dated January 26, 2017. .` Cathy . F rester v iel a ount, r Hollis French Chai , Commissioner Commissioner Commissioner,;,. r'.h RECONSIDERATION AND APPEAL NOTICE As provided in AS 31.05.080(a), within 20 days after written notice of the entry of this order or decision, or such further time as the AOGCC grants for good cause shown, a person affected by it may file with the AOGCC an application for reconsideration of the matter determined by it. If the notice was mailed, then the period of time shall be 23 days. An application for reconsideration must set out the respect in which the order or decision is believed to be erroneous. The AOGCC shall grant or refuse the application for reconsideration in whole or in part within 10 days after it is filed. Failure to act on it within 10-days is a denial of reconsideration. If the AOGCC denies reconsideration, upon denial, this order or decision and the denial of reconsideration are FINAL and may be appealed to superior court. The appeal MUST be filed within 33 days after the date on which the AOGCC mails, OR 30 days if the AOGCC otherwise distributes, the order or decision denying reconsideration, UNLESS the denial is by inaction, in which case the appeal MUST be filed within 40 days after the date on which the application for reconsideration was filed. If the AOGCC grants an application for reconsideration, this order or decision does not become final. Rather, the order or decision on reconsideration will be the FINAL order or decision of the AOGCC, and it may be appealed to superior court. That appeal MUST be filed within 33 days after the date on which the AOGCC mails, OR 30 days if the AOGCC otherwise distributes, the order or decision on reconsideration. In computing a period of time above, the date of the event or default after which the designated period begins to run is not included in the period; the last day of the period is included, unless it falls on a weekend or state holiday, in which event the period runs until 5:00 p.m. on the next day that does not fall on aweekend or state holiday. r� 0 Diane Richmond Performance and Data Management Team Lead BP Exploration (Alaska), Inc. P.O. Box 196612 Anchorage, AK 99519-6612 1DX1]ZXW.T%' ALASKA OIL AND GAS CONSERVATION COMMISSION 333 West 7th Avenue Anchorage, Alaska 99501 Re: THE APPLICATION OF BP Exploration (Alaska) ) Docket Number: CO-16-018 and Inc. to convert the pilot gas -cap water injection ) AIO-16-042 project to a permanent project. ) Conservation Order 207B ) Prudhoe Bay Unit Lisburne Oil Pool North Slope Borough, Alaska January 26, 2017 IT APPEARING THAT: 1. By a letter received September 26, 2016, BP Exploration (Alaska) Inc. (BPXA) requested a conservation order and an area injection order authorizing continued gas -cap water injection (GCWI) into the Lisburne Oil Pool (LOP) for the purpose of enhancing recovery. On its own motion the Alaska Oil and Gas Conservation Commission (AOGCC) proposes to add an administrative action rule. 2. Pursuant to 20 AAC 25.540, the AOGCC tentatively scheduled a public hearing for November 3, 2016. On September 29, 2016, the AOGCC published notice of the opportunity for that hearing on the State of Alaska's Online Public Notice website and on the AOGCC's website, and electronically transmitted the notice to all persons on the AOGCC's email distribution list. On September 30, 2016, the AOGCC published the notice in the ALASKA DISPATCH NEWS and mailed printed copies of the notice to all persons on the AOGCC's mailing distribution list. 3. No comments were received, no one requested that the hearing be held, and the AOGCC determined it had sufficient information to act upon the request so the hearing was vacated on October 24, 2016. FINDINGS: l . BPXA is the operator and a working interest owner (WIO) of the Prudhoe Bay Unit (PBU). Other WIOs include ConocoPhillips Alaska, Inc., ExxonMobil Alaska, Production Inc., and Chevron USA. 2. On June 4, 2008, the AOGCC issued administrative approval CO 207A.00I and AID 4E.029, which authorized a pilot GCWI project for the LOP involving the injection of water into the PBU L5-29 well and monitoring the performance of offset wells. This Administrative approval was set to expire on July 1, 2011, but on June 17, 2011, the AOGCC issued administrative approval CO 207A.002 and AID 4E.038, which extended the expiration date to July 1, 2016. 3. During the pilot GCWI project, BPXA injected approximately 22.1 million barrels of water into the PBU L5-29 well. This raised the average reservoir pressure in the pilot project area by approximately 300 psi. 4. Results in the offset wells have been mixed. Some wells saw increased production or suppressed decline and lowering of the gas oil ratio, while other wells that have seen water breakthrough have experienced decreased production due to increased water cut or production downtime associated with formation of gas hydrates. 5. BPXA estimates that the net benefit of LOP GCWI is on the order of 100 to 350 barrels of oil per day and 0.5 to 3 million stock tank barrels increase in ultimate recovery. These results are less than originally anticipated, and have resulted in the WIOs deciding that GCWI is viable for the LOP but does not warrant being expanded beyond the existing PBU L5-29 well. CO 207B January 26, 2017 Page 2 of 7 6. CO 207 was issued on January 10, 1985, and contains a rule specific to hydrogen sulfide measures. The AOGCC revised its hydrogen sulfide regulations in 1999. 7. CO 207 and 207A lack an administrative action rule, which is a standard rule in more recent AOGCC orders. CONCLUSIONS: 1. The LOP GCWI pilot project has shown that the concept is feasible and that overall it has increased daily production rates and should increase ultimate recovery. 2. Converting the LOP GCWI project from a pilot project to a permanent project will minimize waste and increase ultimate recovery. 3. Changes to area injection order 4F are not necessary in order to carry out continued GCWI at the LOP. 4. The AOGCC regulations on hydrogen sulfide operations provide adequate protection and a pool specific rule is no longer necessary. 5. The addition of an administrative action rule will aid in the proper oversight and development of the LOP. NOW THEREFORE IT IS ORDERED: Development and operation of the Lisburne Oil Pool are subject to the following rules and the statewide requirements under 20 AAC 25 to the extent not superseded by these rules. This order supersedes conservation orders 207 and 207A and all of their associated administrative approvals, except for CO 207.1. The records of those orders and approvals are incorporated by reference into this order. AFFECTED AREA: UMIAT MERIDIAN T10N, R13E Sections 1, 2, 3, 10, 11, and 12. T10N, R14E Sections 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 35, and 36. T10N, R15E All. TION, R16E All. T10N, R17E Sections 3, 4, 5, 6, 7, 8, 9, 10, 15, 16, 17, 18, 19, 20, 21, 22, 27, 28, 29, 30, 31, 32, 33, and 34. TUN, R13E Sections 1, 2, 3, 4, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35, and 36. THN, R14E All. THN, R15E All. THN, R16E All. CO 207B January 26, 2017 Page 3 of 7 T11N, R17E Sections 3, 4, 5, 6, 7, 8, 9, 10, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35, and 36. T12N, R13E Sections 35 and 36. T12N, R14E Sections 13, 14, 15, 16, 21, 22, 23, 24, 25, 26, 27, 28, 31, 32, 33, 34, 35, and 36. T12N R15E Sections 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35, and 36. T12N, R16E Sections 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35, and 36. Rule 1. FIELD AND POOL NAME (Source: CO 207) The field is the Prudhoe Bay Field and the pool is the Lisburne Oil Pool. Rule 2. POOL DEFINITION (Source: CO 207) The Lisburne Oil Pool is defined as the accumulations of oil and gas which occur in stratigraphic sections which correlate with the stratigraphic section found in the Atlantic Richfield -Humble Prudhoe Bay State No. 1 well between the depths of 8,790 feet measured depth and 10,440 feet measured depth. Rule 3. WELL SPACING (Source: CO 207) The well spacing unit shall be one producing well per governmental quarter section. No pay may be opened in a well closer than 1,000 feet to the pay opened in another well or opened in a well which is closer than 500 feet to the boundary of the affected area. Rule 4. CASING AND CEMENTING (Source: CO 207, Revised: CO 207.2) a) A conductor casing shall be set at least 75 feet below the surface and sufficient cement shall be used to fill the annulus behind the pipe to the surface. Rigid high density polyurethane foam may be used as an alternate to cement, upon approval by the Commission. The Commission may also administratively approve other sealing materials which are supported by sound engineering principles and performance data. b) Surface casing to provide proper anchorage for equipment to prevent uncontrolled flow, to withstand anticipated interval pressure and to protect the well from the effects of permafrost thaw -subsidence or freeze back loadings shall be set at least 500 feet, measured depth, below the base of the permafrost but not below 5000 feet true vertical depth. Sufficient cement shall be used to fill the annulus behind the casing to the surface. c) Surface casing types and grades approved for use through the permafrost interval include: CO 207B January 26, 2017 Page 4 of 7 1) 13-3/8 inch, 72 pounds/foot, L-80 Buttress; 2) 13-3/8 inch, 72 pounds/foot, N-80 Buttress; 3) 13-3/8 inch, 68 pounds/foot, MN-80 Buttress; and 4)13-3/8 inch, 68 pounds/foot, K-55 d) The Commission may administratively approve additional types and grades of surface casing through the permafrost interval upon a showing that the proposed casing and connection can withstand the permafrost thaw -subsidence and freeze back loadings which may be experienced. Evidence submitted to the Commission shall include: 1) full scale tension and compression testing: or 2) finite element model studies: or 3) other types of axial strain data acceptable to the Commission. e) Alternate casing programs may be administratively approved by the Commission upon application and presentation of data which show the alternatives are appropriate, based upon accepted engineering principles. Rule 5. COMPLETION PRACTICES (Source: CO 207). Wells completed for production may utilize casing strings or liners cemented through the productive intervals and perforated, slotted liners, screen -wrapped liners, gravel packs or open hole methods, or combinations thereof. The Commission may administratively approve alternate completion methods where appropriate. Rule 6. HYDROGEN SULFIDE (Rescinded this Order). Rule 7. AUTOMATIC SHUT-IN EOUIPMENT (Rescinded by Other Order No. 66) Rule 8. GAS VENTING OR FLARING (Source: CO 207) a) The venting or flaring of gas is prohibited except for operational necessities and for safety volumes set out in this rule; b) A daily average volume of 1,000 MCF per day is approved for the safety flare at the Lisburne Production Center; c) Volumes of gas to provide safety flares for additional facilities may be approved by administrative order upon proper application; d) The volumes of gas for safety flares may be decreased or increased by administrative order; and e) Gas flaring may be approved by administrative order during commissioning of new equipment, purging, and start-ups after major repairs or interruptions. Rule 9. GAS -OIL RATIO TESTS (Source: CO 207) a) Between 90 and 120 days after regular production commences and each six months thereafter a gas -oil ratio test will be taken on each well for as long as it produces oil; CO 207B January 26, 2017 Page 5 of 7 b) The gas -oil ratio tests will be for a minimum of four hours and shall be taken at the normal producing rate of the well; and c) The results of the gas -oil ratio tests will be reported on Form 10-409, Gas -Oil Ratio Test and will be submitted in January and July of each year. Rule 10. PRESSURE SURVEYS (Source: CO 207, Revised CO 207.11)* a) All new wells shall have an acceptable pressure survey, as defined in part (c), taken prior to regular production or injection. b) One pressure survey per producing drillsite per year shall be taken. Pressure surveys from producing or water and gas injection wells may be used for this pressure requirement. Pressure surveys covered in section (a) may be substituted for a drillsite pressure. c) Acceptable pressure surveys include static surveys, RFT/FMT, pressure buildup and falloff tests, and multi -rate pressure transient tests in production or injection wells. Other quantitative methods may be administratively approved by the Commission. d) The pressure datum for the Lisburne Oil Pool is 8900 feet subsea. The Commission may administratively amend this datum or create an additional datum when more information is available on the reservoir. e) Data from the pressure surveys, along with additional pressure data obtained through proper management of the reservoir, shall be filed on form 10-412 by the last day of the month following the month that the pressure survey was obtained. Submitted pressure data shall include other information as necessary such as rate, time, depth, temperature, and well conditions to allow for a complete analysis of the pressure survey. f) The operator shall schedule an annual meeting with the Commission to review the pressure monitoring program and discus future plans for reservoir management. Rule 11. UNITIZATION (Source: CO 207) To ensure the protection of correlative rights and to prevent waste, the Lisburne Oil Pool shall be administered in accordance with the Prudhoe Bay Unit Agreement. Rule 12. PILOT PROJECTS (Source: CO 207) Upon application, the Commission may administratively approve field pilot projects, well production and injection tests and other filed operations necessary for the purpose of developing a prudent enhanced recovery method and reservoir depletion program. Rule 13. POOL OFFTAI E RATE (Source: CO 207) No more than 160,000 barrels of oil per day may be produced from the Lisburne Oil Pool. However when evidence can be presented to the Commission showing that a higher offtake rate will not affect ultimate recovery, the Commission may increase the daily offtake rate by administrative order. Rule 14. CONSERVATION ORDER NO.83-C (Source: CO 207) CO 207B January 26, 2017 Page 6 of 7 Conservation Order No. 83-C is hereby cancelled. Rule 15. ANNULAR PRESSURES (Source: CO 492, Revised by: CO 207.17) a) The operator shall conduct and document a pressure test of tubulars and completion equipment in each development well at the time of installation or replacement that is sufficient to demonstrate that planned well operations will not result in failure of well integrity, uncontrolled release of fluid or pressure, or threat to human safety. b) The operator shall monitor each development well daily to check for sustained pressure, except if prevented by extreme weather conditions, emergency situations, or similar unavoidable circumstances. Monitoring results shall be made available for AOGCC inspection. c) The operator shall notify the AOGCC within three working days after the operator identifies a well as having (a) sustained inner annulus pressure that exceeds 2500 psig for wells processed through the Lisburne Processing Center and 2000 psig for all other development wells, or (b) sustained outer annulus pressure that exceeds 1000 psig. d) The AOGCC may require the operator to submit in an Application for Sundry Approvals (Form 10-403) a proposal for corrective action or increased surveillance for any development well having sustained pressure that exceeds a limit set out in paragraph 3 of this rule. The AOGCC may approve the operator's proposal or may require other corrective action or surveillance. The AOGCC may require that corrective action be verified by mechanical integrity testing or other AOGCC approved diagnostic tests. The operator shall give AOGCC sufficient notice of the testing schedule to allow AOGCC to witness the tests. e) If the operator identifies sustained pressure in the inner annulus of a development well that exceeds 45% of the burst pressure rating of the well's production casing for inner annulus pressure, or sustained pressure in the outer annulus that exceeds 45% of the burst pressure rating of the well's surface casing for outer annulus pressure, the operator shall notify the AOGCC within three working days and take corrective action. Unless well conditions require the operator to take emergency corrective action before AOGCC approval can be obtained, the operator shall submit in an Application for Sundry Approvals (Form 10-403) a proposal for corrective action. The AOGCC may approve the operator's proposal or may require other corrective action. The AOGCC may also require that corrective action be verified by mechanical integrity testing or other AOGCC approved diagnostic tests. The operator shall give AOGCC sufficient notice of the testing schedule to allow AOGCC to witness the tests. f) Except as otherwise approved by the AOGCC under paragraph 4 or 5 of this rule, before a shut- in well is placed in service, any annulus pressure must be relieved to a sufficient degree (a) that the inner annulus pressure at operating temperature will be below 2500 psig for wells processed through the Lisburne Production Center and below 2000 psig for all other development wells, and (b) that the outer annulus pressure at operating temperature will be below 1000 psig. However, a well that is subject to paragraph 3, but not paragraph 5, of these rules may reach an annulus pressure at operating temperature that is described in the operator's notification to the AOGCC under paragraph 3, unless the AOGCC prescribes a different limit. g) For purposes of these rules, "inner annulus" means the space in a well between tubing and production casing; "outer annulus" means the space in a well between production casing and surface casing; "sustained pressure" means pressure that (a) is measurable at the casing head of an annulus, (b) is not caused solely by temperature fluctuations, and (c) is not pressure that has been applied intentionally. CO 207B January 26, 2017 Page 7 of 7 Rule 16. GAS -CAP WATER INJECTION PROJECT (New this order) a) Water injection is authorized into Well L5-29 only and is limited to perforations within the upper Wahoo Formation (Zone 6) between the measured depths of 13,585' and 13,634'; b) The Well L5-29 injection rate is limited to 20,000 barrels of water injected per day; and c) Injection pressures must be maintained below 0.55 psi/ft. Rule 17. ADMMSTRATIVE ACTION (New this order) Upon proper application, or its own motion, and unless notice and public hearing are otherwise required, the Commission my administratively waive the requirements of any rule stated herein or administratively amend this order as long as the change does not promote waste or jeopardize correlative rights, is based on sound engineering and geoscience principles, and will not result in an increased risk of fluid movement into freshwater aquifers. DONE at Anchorage, Alaska and dated January 26, 2017. //signature on file// //signature on file// Cathy P. Forester Daniel T. Seamount, Jr Chair, Commissioner Commissioner OIL ISO //signature on file// Hollis French Commissioner irON CO`9g` RECONSIDERATION AND APPEAL NOTICE As provided in AS 31.05.080(a), within 20 days after written notice of the entry of this order or decision, or such further time as the AOGCC grants for good cause shown, a person affected by it may file with the AOGCC an application for reconsideration of the matter determined by it. If the notice was mailed, then the period of time shall be 23 days. An application for reconsideration must set out the respect in which the order or decision is believed to be erroneous. The AOGCC shall grant or refuse the application for reconsideration in whole or in part within 10 days after it is filed. Failure to act on it within 10-days is a denial of reconsideration. If the AOGCC denies reconsideration, upon denial, this order or decision and the denial of reconsideration are FINAL and may be appealed to superior court. The appeal MUST be filed within 33 days after the date on which the AOGCC mails, OR 30 days if the AOGCC otherwise distributes, the order or decision denying reconsideration, UNLESS the denial is by inaction, in which case the appeal MUST be filed within 40 days after the date on which the application for reconsideration was filed. If the AOGCC grants an application for reconsideration, this order or decision does not become final. Rather, the order or decision on reconsideration will be the FINAL order or decision of the AOGCC, and it may be appealed to superior court. That appeal MUST be filed within 33 days after the date on which the AOGCC mails, OR 30 days if the AOGCC otherwise distributes, the order or decision on reconsideration. In computing a period of time above, the date of the event or default after which the designated period begins to run is not included in the period; the last day of the period is included, unless it falls on a weekend or state holiday, in which event the period runs until 5:00 p.m. on the next day that does not fall on a weekend or state holiday. Colombie, Jody J (DOA) From: Colombie, Jody J (DOA) Sent: Thursday, January 26, 2017 10:45 AM To: aogcc.inspectors@alaska.gov; 'Bender, Makana K (DOA) (makana.bender@alaska.gov)'; 'Bettis, Patricia K (DOA) (patricia.bettis@alaska.gov)'; 'Brooks, Phoebe L (DOA) (phoebe. brooks@ a laska.gov)'; Carlisle, Samantha J (DOA); 'Colombie, Jody J (DOA) Oody.colombie@alaska.gov)'; 'Davies, Stephen F (DOA) (steve.davies@alaska.gov)'; Eaton, Loraine E (DOA); 'Foerster, Catherine P (DOA) (cathy.foerster@alaska.gov)'; 'French, Hollis (DOA)'; Trystacky, Michal (michal.frystacky@alaska.gov)'; 'Guhl, Meredith (DOA sponsored) (meredith.guhl@alaska.gov)'; Kair, Michael N (DOA); 'Link, Liz M (DOA)'; Loepp, Victoria T (DOA); 'Mumm, Joseph (DOA sponsored) Ooseph.mumm@alaska.gov)'; 'Paladijczuk, Tracie L (DOA) (tracie. pa lad ijczu k@ a laska.gov)'; 'Pasqual, Maria (DOA) (maria.pasqual@alaska.gov)'; 'Quick, Michael (DOA sponsored)'; 'Regg, James B (DOA) Oim.regg@alaska.gov)'; 'Roby, David S (DOA) (dave.roby@alaska.gov)'; 'Schwartz, Guy L (DOA) (guy.schwartz@alaska.gov)'; 'Seamount, Dan T (DOA) (dan.seamount@alaska.gov)'; Singh, Angela K (DOA); 'Wallace, Chris D (DOA) (chris.waIlace@alaska.gov)'; AK, GWO Projects Well Integrity, 'AKDCWeIIIntegrityCoordinator'; 'Alan Bailey'; 'Alex Demarban'; 'Alexander Bridge'; 'Allen Huckabay'; 'Andrew VanderJack'; 'Ann Danielson'; Anna Raff; 'Barbara F Fullmer'; bbritch; Becky Bohrer; 'Ben Boettger'; 'Bill Bredar'; Bob; Brandon Viator; 'Brian Havelock'; 'Bruce Webb'; 'Caleb Conrad'; 'Candi English'; Cocklan- Vendl, Mary E; Colleen Miller, 'Connie Downing'; Crandall, Krissell; 'D Lawrence'; 'Dale Hoffman'; 'Dave Harbour'; David Boelens; 'David Duffy'; David House; 'David McCaleb'; 'David McCraine'; 'David Tetta'; 'ddonkel@cfl.rr.com'; 'DNROG Units'; 'Donna Ambruz'; 'Ed Jones'; 'Elizabeth Harball'; Elowe, Kristin; 'Evan Osborne'; Evans, John R (LDZX); 'Gary Oskolkosf'; 'George Pollock'; Gordon Pospisil; Greeley, Destin M (DOR); 'Gretchen Stoddard'; gspfoff, Hurst, Rona D (DNR); Hyun, James J (DNR); 'Jacki Rose'; Jdarlington Oarlington@gmail.com); 'Jeanne McPherren'; 'Jerry Hodgden'; Jill Simek; 'Jim Watt'; Jim White; 'Joe Lastufka'; Joe Nicks; 'John Burdick'; 'John Easton'; John Larsen; 'John Stuart'; Jon Goltz; Josef Chmielowski; 'Juanita Lovett'; 'Judy Stanek'; Kari Moriarty, 'Kasper Kowalewski'; 'Kazeem Adegbola'; 'Keith Torrance'; Keith Wiles; Kelly Sperback; Kevin Frank, Kruse, Rebecca D (DNR); Laura Silliphant (laura.gregersen@alaska.gov); Leslie Smith; Lori Nelson; Louisiana Cutler; 'Luke Keller'; 'Marc Kovak'; Mark Dalton; Mark Hanley (mark.hanley@anadarko.com); 'Mark Landt'; 'Mark Wedman'; 'Mealear Tauch'; 'Michael Bill'; Michael Calkins; 'Michael Moora'; MJ Loveland; mkm7200; Mueller, Marta R (DNR); Munisteri, Islin W M (DNR); nelson; Nichole Saunders; Nikki Martin; NSK Problem Well Supv; Patty Alfaro; 'Paul Craig'; Paul Decker (paul.decker@alaska.gov); 'Paul Mazzolini'; Pike, Kevin W (DNR); Randall Kanady; 'Renan Yanish'; 'Richard Cool'; 'Robert Brelsford'; 'Ryan Tunseth'; Sara Leverette; 'Scott Griffith'; Shahla Farzan; Shannon Donnelly; Sharmaine Copeland; 'Sharon Yarawsky'; Shellenbaum, Diane P (DNR); Skutca, Joseph E (DNR); Smart Energy Universe; Smith, Kyle S (DNR); 'Stephanie Klemmer'; 'Stephen Hennigan'; Sternicki, Oliver R; Steve Moothart (steve.moothart@alaska.gov); 'Steve Quinn'; 'Suzanne Gibson'; 'Tamers Sheffield'; 'Ted Kramer'; 'Temple Davidson'; 'Teresa Imm'; 'Thor Cutler'; 'Tim Jones'; 'Tim Mayers'; 'Todd Durkee'; 'trmjrl'; 'Tyler Senden'; Umekwe, Maduabuchi P (DNR); 'Vinnie Catalano'; 'Well Integrity'; 'Well Integrity'; 'Weston Nash'; 'Whitney Pettus'; 'Aaron Gluzman'; 'Aaron Sorrell'; Ajibola Adeyeye; Alan Dennis; Assmann, Aaron A; Bajsarowicz, Caroline J; 'Bruce Williams'; Bruno, Jeff J (DNR); Casey Sullivan; Catie Quinn; 'Don Shaw'; Eric Lidji; Garrett Haag; 'Graham Smith'; Hak Dickenson; Heusser, Heather A (DNR); Holly Fair, Holly Pearen; Jamie M. Long; 'Jason Bergerson'; Jesse Chielowski; 'Jim Magill'; Joe Longo; John Martineck; Josh Kindred; Laney Vazquez; Lois Epstein; Longan, Sara W (DNR); Marc Kuck; Marcia Hobson; 'Marie Steele'; Matt Armstrong; 'Mike Franger'; Morgan, Kirk A (DNR); Pascal Umekwe; Pat Galvin; 'Pete Dickinson'; Peter Contreras; Richard Garrard; Richmond, Diane M; Robert Province; 'Ryan Daniel'; 'Sandra Lemke'; 'Susan Pollard'; Talib Syed; Tina Grovier (tmgrovier@stoel.com); Tostevin, Breck C (LAW); 'Wayne Wooster'; 'William Van Dyke' Subject: co207BB PXA) Attachments: co207B Final.pdf Please see attached. Re: THE APPLICATION OF BP Exploration (Alaska) Inc. to convert the pilot gas -cap water injection project to a permanent project. Jody J. Colombie .A0( CC Special Assistant .Ataska Oit and yas Conservation Commission 333 'Nest 7" _Aven u e Anchorage, ,Alaska 99501 Off ice: (907) 7�()3-1 J 21 fax: (907) 276-7542 • Docket Number: CO-16-018 and AIO- 16-042 Conservation Order 207B Prudhoe Bay Unit Lisburne Oil Pool North Slope Borough, Alaska January 26, 2017 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 Jody Colombie at 907.793.1221 or iodv.colombie@alaska.aov. • • Bernie Karl K&K Recycling Inc. P.O. Box 58055 Fairbanks, AK 99711 George Vaught, Jr. P.O. Box 13557 Denver, CO 80201-3557 Gordon Severson 3201 Westmar Cir. Anchorage, AK 99508-4336 Darwin Waldsmith P.O. Box 39309 Ninilchik, AK 99639 Penny Vadla 399 W. Riverview Ave. Soldotna, AK 99669-7714 Richard Wagner P.O. Box 60868 Fairbanks, AK 99706 THE STATE °fALASKA GOVERNOR MIKE DUNLEAVY Ms. Katrina Garner Alaska Oil and Gas Conservation Commission ADMINISTRATIVE APPROVAL CONSERVATION ORDER NO. 207B.002 West Area Manager, Reservoir Management, Prudhoe Bay Unit BP Exploration (Alaska) Inc. 900 East Benson Boulevard P.O. Box 196612 Anchorage, AK 99519-6612 Re: Docket Number: CO -19-012 333 west Seventh Avenue Anchorage, Alaska 99501-3572 Main: 907.279.1433 Fax: 907.276.7542 www.aogcc.alaska.gov Request for a spacing exception by Administrative Approval under Conservation Order No. 207B to allow drilling, completion, and production of the Prudhoe Bay Unit L5-27 development oil well within the same governmental quarter sections as wells that are, or may be capable of, producing from the same pool. Prudhoe Bay Unit L5-27 (PTD 219-046) Prudhoe Bay Field Lisburne Oil Pool Dear Ms. Garner: By letter received March 21, 2019, BP Exploration (Alaska) Inc. (BPXA) requests a spacing exception by Administrative Approval under Conservation Order No. 207B (CO 207B) to allow drilling, completion, and production of the Prudhoe Bay Unit L5-27 development oil well (L5-27) within the same governmental quarter sections as wells that are, or may be capable of, producing from the same pool. FINDINGS: 1. The surface location for L5-27 will be in Section 2 of TI IN, R15E, Umiat Meridian (UM). L5-27 will open the Lisburne Oil Pool in Section 3 of TI IN, R15E, UM, and it will reach total depth in Section 3 of TI IN, R15E, UM. 2. BPXA is the operator for the Lisburne Oil Pool, affected State of Alaska Leases ADL028320 and ADL034631, and all surrounding leases. 3. CO 207B governs the Lisburne Oil Pool, and Rule 3 of that order establishes well spacing requirements for the pool. 4. Rule 3 specifies the well spacing unit for the pool shall be one producing well per governmental quarter section. Rule 3 also specifies no pay may be opened in a well closer than 1,000 feet to the pay opened in another well or opened in a well that is closer than 500 feet to the boundary of the Affected Area. 5. L5-27 will lie within the Affected Area of CO 207B. CO 20713-002 April 4, 2019 Page 2 of 3 6. L5-27 will open the Lisburne Oil Pool more than 1,000 feet from the nearest well open to the same pool in compliance with Rule 3. 7. L5-27 will be located more than 500 feet from the boundary of the Affected Area of CO 207B in compliance with Rule 3. 8. L5-27 will violate Rule 3 because it will open the Lisburne Oil Pool within the same governmental quarter section as a producing well—L5-21—that is open to the same pool. 9. BPXA's selected trajectory for L5-27 through the Lisburne reservoir is necessary to access un -drained reserves that cannot be reached by wells conforming to applicable spacing requirements. 10. BPXA's plan for L5-27 is based on sound engineering and geoscience principles; it will not result in waste or increase the risk of fluid movement into freshwater aquifers. 11. Rule 17 of CO 207B allows the AOGCC to administratively waive the requirements of any rule stated therein or to administratively amend CO 207B as long as the change does not promote waste or jeopardize correlative rights, is based on sound engineering and geoscience principles, and will not result in an increased risk of fluid movement into freshwater aquifers. CONCLUSIONS: L An exception to the well spacing requirements of Rule 3 of CO 207B is necessary to allow drilling, completion, and production of the L5-27 development oil well to maximize reserve recovery from the Lisburne Oil Pool. 2. A spacing exception to allow drilling, completion, and production of the L5-27 development oil well is consistent with sound engineering and geoscience principles, and it will not result in waste, jeopardize correlative rights of adjoining or nearby owners, or increase the risk of fluid movement into freshwater aquifers. NOW THEREFORE IT IS ORDERED: BPXA's March 19, 2019 application for an order granting an exception to the well spacing requirements of Rule 3 of Conservation Order No. 207B to allow drilling, completion, and production of the L5-27 development oil well is approved. BPXA may proceed as long as it complies with the terms of the Prudhoe Bay Unit agreement, applicable Alaska laws, and all other legal requirements. DONE at Anchorage, Alaska and dated April 4, 2019. ��AA anie 'o t, r. J ie L. Chmielowski Commi eerr m�r efi is CO 207B-002 April 4, 2019 Page 3 of 3 As provided in AS 31.05.080(a), within 20 days after written notice of the entry of this order or decision, or such further time as the AOGCC grants for good cause shown, a person affected by it may file with the AOGCC an application for reconsideration of the matter determined by it. If the notice was mailed, then the period of time shall be 23 days. An application for reconsideration must set out the respect in which the order or decision is believed to be erroneous. The AOGCC shall grant or refuse the application for reconsideration in whole or in part within 10 days after it is filed. Failure to act on it within 10 -days is a denial of reconsideration. If the AOGCC denies reconsideration, upon denial, this order or decision and the denial of reconsideration are FINAL and may be appealed to superior court. The appeal MUST be filed within 33 days after the date on which the AOGCC mails, OR 30 days if the AOGCC otherwise distributes, the order or decision denying reconsideration, UNLESS the denial is by inaction, in which case the appeal MUST be filed within 40 days after the date on which the application for reconsideration was filed. If the AOGCC grants an application for reconsideration, this order or decision does not become final. Rather, the order or decision on reconsideration will be the FINAL order or decision of the AOGCC, and it may be appealed to superior court. That appeal MUST be filed within 33 days after the date on which the AOGCC mails, OR 30 days if the AOGCC otherwise distributes, the order or decision on reconsideration. In computing a period of time above, the date of the event or default after which the designated period begins to ran is not included in the period; the last day of the period is included, unless it falls on a weekend or state holiday, in which event the period runs until 5:00 p.m. on the next day that does not fall on a weekend or state holiday. THE STATF °ALASKA GOVERNOR MICHAEL J. DUNLEAVY Alaska Oil and Gas Conservation Commission ADMINISTRATIVE APPROVAL CONSERVATION ORDER NO. 207B.002 Ms. Katrina Gamer West Area Manager, Reservoir Management, Prudhoe Bay Unit BP Exploration (Alaska) Inc. 900 East Benson Boulevard P.O. Box 196612 Anchorage, AK 99519-6612 Re: Docket Number: CO-] 9-012 333 West Seventh Avenue Anchorage, Alaska 99501-3572 Main: 907.279.1433 Fax: 907.276.7542 v W.aogcc.aloska.gov Request for a spacing exception by Administrative Approval under Conservation Order No. 207B to allow drilling, completion, and production of the Prudhoe Bay Unit L5-27 development oil well within the same governmental quarter sections as wells that are, or may be capable of, producing from the same pool. Prudhoe Bay Unit L5-27 (PTD 219-046) Prudhoe Bay Field Lisburne Oil Pool Dear Ms. Garner: By letter received March 21, 2019, BP Exploration (Alaska) Inc. (BPXA) requests a spacing exception by Administrative Approval under Conservation Order No. 207B (CO 207B) to allow drilling, completion, and production of the Prudhoe Bay Unit L5-27 development oil well (L5-27) within the same governmental quarter sections as wells that are, or may be capable of, producing from the same pool. FINDINGS: I. The surface location for L5-27 will be in Section 2 ofT1IN, RI 5E, Umiat Meridian (UM). L5-27 will open the Lisburne Oil Pool in Section 3 of Tl 1N, R15E, UM, and it will reach total depth in Section 3 of TI IN, R15E, UM. 2. BPXA is the operator for the Lisburne Oil Pool, affected State of Alaska Leases ADL028320 and ADL034631, and all surrounding leases. 3. CO 207B governs the Lisburne Oil Pool, and Rule 3 of that order establishes well spacing requirements for the pool. 4. Rule 3 specifies the well spacing unit for the pool shall be one producing well per governmental quarter section. Rule 3 also specifies no pay may be opened in a well closer than 1,000 feet to the pay opened in another well or opened in a well that is closer than 500 feet to the boundary of the Affected Area. 5. L5-27 will lie within the Affected Area of CO 207B. CO 207B-002 April 4, 2019 Page 3 of 3 As provided in AS 31.05.080(a), within 20 days after written notice of the entry of this order or decision, or such further time as the AOGCC grants for good cause shown, a person affected by it may file with the AOGCC an application for reconsideration of the matter determined by it. If the notice was mailed, then the period of time shall be 23 days. An application for reconsideration must set out the respect in which the order or decision is believed to be erroneous. The AOGCC shall grant or refuse the application for reconsideration in whole or in part within 10 days after it is filed. Failure to act on it within 10 -days is a denial of reconsideration. If the AOGCC denies reconsideration, upon denial, this order or decision and the denial of reconsideration are FINAL and may be appealed to superior court. The appeal MUST be filed within 33 days after the date on which The AOGCC mails, OR 30 days if the AOGCC otherwise distributes, the order or decision denying reconsideration, UNLESS the denial is by inaction, in which case the appeal MUST be filed within 40 days after the date on which the application for reconsideration was filed. If the AOGCC grants an application for reconsideration, this order or decision does not become final. Rather, the order or decision on reconsideration will be the FINAL order or decision of the AOGCC, and it may be appealed to superior court. That appeal MUST be filed within 33 days after the date on which the AOGCC mails, OR 30 days if the AOGCC otherwise distributes, the order or decision on reconsideration. In computing a period of time above, the date of the event or default atter which the designated period begins to run is not included in the period; the last day of the period is included, unless it falls on a weekend or state holiday, in which event the period runs until 5:00 p.m. on the next day that does not fall on a weekend or state holiday. Bernie Karl Gordon Severson Penny Vadla K&K Recycling Inc. P.O. Box 58055 3201 Westmar Cir. 399 W. Riverview Ave. Fairbanks, AK 99711 Anchorage, AK 99508-4336 Soldotna, AK 99669-7714 George Vaught, Jr. Darwin Waldsmith Richard Wagner P.O. Box 13557 P.O. Box 39309 P.O. Box 60868 Denver, CO 80201-3557 Ninilchik, AK 99639 Fairbanks, AK 99706 THE STATE °fALASKA GOVERNOR MIKE DUNLEAVY Ms. Katrina Garner Alaska Oil and Gas Conservation Commission ADMINISTRATIVE APPROVAL CONSERVATION ORDER NO. 207B.001 West Area Manager, Reservoir Management, Prudhoe Bay Unit BP Exploration (Alaska) Inc. P.O. Box 196612 Anchorage, AK 99519-6612 333 West Seventh Avenue Anchorage, Alaska 99501-3572 Main907.279.1433 Fax, 907.276.7542 www.a og c c.a I oska. gc v Re: Docket Number: CO -19-011 Request for a spacing exception by Administrative Approval under Conservation Order No. 207B to allow drilling, completion, and production of the Prudhoe Bay Unit L5-03 development oil well within the same governmental quarter sections as wells that are, or may be capable of, producing from the same pool. Prudhoe Bay Unit L5-03 (PTD 219-033) Prudhoe Bay Field Lisburne Oil Pool Dear Ms. Garner: By letter received March 19, 2019, BP Exploration (Alaska) Inc. (BPXA) requests a spacing exception by Administrative Approval under Conservation Order No. 207B (CO 207B) to allow drilling, completion, and production of the Prudhoe Bay Unit L5-03 development oil well (L5-03) within the same governmental quarter sections as wells that are, or may be capable of, producing from the same pool. FINDINGS: The surface location for L5-03 will be in Section 2 of TI IN, RI 5E, Umiat Meridian (UM). L5-03 will open the Lisburne Oil Pool in Sections 11, 2, and 3 of TI IN, RI 5E, UM, respectively, and it will reach total depth in Section 3 of T1 IN, R1 5E, UM. 2. BPXA is the operator for the Lisburne Oil Pool, affected State of Alaska Leases ADL028320 and ADL034631, and all surrounding leases. 3. CO 207B governs the Lisburne Oil Pool, and Rule 3 of that order establishes well spacing requirements for the pool. 4. Rule 3 specifies the well spacing unit for the pool shall be one producing well per governmental quarter section. Rule 3 also specifies no pay may be opened in a well closer than 1,000 feet to the pay opened in another well or opened in a well that is closer than 500 feet to the boundary of the Affected Area. CO 20713-001 April 4, 2019 Page 2 of 3 5. L5-03 will lie within the Affected Area of CO 207B. 6. L5-03 will open the Lisburne Oil Pool more than 1,000 feet from the nearest well open to the same pool in compliance with Rule 3. 7. L5-03 will be located more than 500 feet from the boundary of the Affected Area of CO 207B in compliance with Rule 3. 8. L5-03 will violate Rule 3 because it will open the Lisburne Oil Pool within the same governmental quarter sections as two producing wells—L5-01 and L5-17A—that are open to the same pool. 9. BPXA's selected trajectory for L5-03 through the Lisburne reservoir is necessary to access un -drained reserves that cannot be reached by wells conforming to applicable spacing requirements. 10. BPXA's plan for L5-03 is based on sound engineering and geoscience principles; it will not result in waste or increase the risk of fluid movement into freshwater aquifers. 11. Rule 17 of CO 207B allows the AOGCC to administratively waive the requirements of any rule stated therein or to administratively amend CO 207B as long as the change does not promote waste or jeopardize correlative rights, is based on sound engineering and geoscience principles, and will not result in an increased risk of fluid movement into freshwater aquifers. CONCLUSIONS: 1. An exception to the well spacing requirements of Rule 3 of CO 207B is necessary to allow drilling, completion, and production of the L5-03 development oil well to maximize reserve recovery from the Lisburne Oil Pool. 2. A spacing exception to allow drilling, completion, and production of the L5-03 development oil well is consistent with sound engineering and geoscience principles, and it will not result in waste, jeopardize correlative rights of adjoining or nearby owners, or increase the risk of fluid movement into freshwater aquifers. NOW THEREFORE IT IS ORDERED: BPXA's March 19, 2019 application for an order granting an exception to the well spacing requirements of Rule 3 of Conservation Order No. 207B to allow drilling, completion, and production of the L5-03 development oil well is approved. BPXA may proceed as long as it complies with the terms of the Prudhoe Bay Unit agreement, applicable Alaska laws, and all other legal requirements. DONE at Anchorage, Alaska and dated April 4, 2019.J • �o"`e�/ w lam"/"` _ ani Seamount, Jr. J se L. Chmielowski ommissioner Commissioner CO 2076-001 April 4, 2019 Page 3 of 3 As provided in AS 31.05.080(a), within 20 days after written notice of the entry of this order or decision, or such further time as the AOGCC grants for good cause shown, a person affected by it may file with the AOGCC an application for reconsideration of the matter determined by it. If the notice was mailed, then the period of time shall be 23 days. An application for reconsideration must set out the respect in which the order or decision is believed to be erroneous. The AOGCC shall grant or refuse the application for reconsideration in whole or in part within 10 days after it is filed. Failure to act on it within 10 -days is a denial of reconsideration. If the AOGCC denies reconsideration, upon denial, this order or decision and the denial of reconsideration are FINAL and may be appealed to superior court. The appeal MUST be filed within 33 days after the date on which the AOGCC mails, OR 30 days if the AOGCC otherwise distributes, the order or decision denying reconsideration, UNLESS the denial is by inaction, in which case the appeal MUST be filed within 40 days after the date on which the application for reconsideration was filed. If the AOGCC grants an application for reconsideration, this order or decision does not become final. Rather, the order or decision on reconsideration will be the FINAL order or decision of the AOGCC, and it may be appealed to superior court. That appeal MUST be filed within 33 days after the date on which the AOGCC mails, OR 30 days if the AOGCC otherwise distributes, the order or decision on reconsideration. In computing a period of time above, the date of the event or default after which the designated period begins to run is not included in the period; the last day of the period is included, unless it falls on a weekend or state holiday, in which event the period runs until 5:00 p.m. on the next day that does not fall on a weekend or state holiday. THE STATE 01ALASKA Alaska Oil and Gas Conservation Commission GOV-RNOR MICHAEL 1. DUNUAVY 333 West Seventh Avenue Anchorage, Alaska 99501-3572 Main: 907.279.1433 Fax: 907.276.7542 www.aogcc.olaska.gov ADMINISTRATIVE APPROVAL CONSERVATION ORDER NO. 207B.001 Ms. Katrina Gamer West Area Manager, Reservoir Management, Prudhoe Bay Unit BP Exploration (Alaska) Inc. P.O. Box 196612 Anchorage, AK 99519-6612 Re: Docket Number: CO -19-011 Request for a spacing exception by Administrative Approval under Conservation Order No. 207B to allow drilling, completion, and production of the Prudhoe Bay Unit L5-03 development oil well within the same governmental quarter sections as wells that are, or may be capable of, producing from the same pool. Prudhoe Bay Unit LS -03 (PTD 219-033) Prudhoe Bay Field Lisburne Oil Pool Dear Ms. Garner: By letter received March 19, 2019, BP Exploration (Alaska) Inc. (BPXA) requests a spacing exception by Administrative Approval under Conservation Order No. 207B (CO 207B) to allow drilling, completion, and production of the Prudhoe Bay Unit L5-03 development oil well (L5-03) within the same governmental quarter sections as wells that are, or may be capable of, producing from the same pool. FINDINGS: 1. The surface location for L5-03 will be in Section 2 of TI IN, RI 5E, Umiat Meridian (UM). L5-03 will open the Lisburne Oil Pool in Sections 11, 2, and 3 of Tl 1N, R15E, UM, respectively, and it will reach total depth in Section 3 of TI IN, R15E, UM. 2. BPXA is the operator for the Lisburne Oil Pool, affected State of Alaska Leases ADL028320 and ADL034631, and all surrounding leases. 3. CO 207B governs the Lisburne Oil Pool, and Rule 3 of that order establishes well spacing requirements for the pool. 4. Rule 3 specifies the well spacing unit for the pool shall be one producing well per governmental quarter section. Rule 3 also specifies no pay may be opened in a well closer than 1,000 feet to the pay opened in another well or opened in a well that is closer than 500 feet to the boundary of the Affected Area. CO 2076-001 April 4, 2019 Page 3 of 3 As provided in AS 31.05.080(a), within 20 days after written notice of the entry of this order or decision, or such further time as the AOGCC grants for good cause shown, a person affected by it may file with the AOGCC an application for reconsideration of the matter determined by it. If the notice was mailed, then the period of time shall be 23 days. An application for reconsideration must set out the respect in which the order or decision is believed to be erroneous. The AOGCC shall grant or refuse the application for reconsideration in whole or in part within 10 days after it is filed. Failure to act on it within 10 -days is a denial of reconsideration. If the AOGCC denies reconsideration, upon denial, this order or decision and the denial of reconsideration are FINAL and may be appealed to superior court. The appeal MUST be filed within 33 days after the date on which the AOGCC mails, OR 30 days if the AOGCC otherwise distributes, the order or decision denying reconsideration, UNLESS the denial is by inaction, in which case the appeal MUST be filed within 40 days after the date on which the application for reconsideration was filed. If the AOGCC grants an application for reconsideration, this order or decision does not become final. Rather, the order or decision on reconsideration will be the FINAL order or decision of the AOGCC, and it may be appealed to superior court. That appeal MOST be filed within 33 days after the date on which the AOGCC mails, OR 30 days if the AOGCC otherwise distributes, the order or decision on reconsideration. In computing a period of time above, the date of the event or default after which the designated period begins to run is not included in the period; the last day of the period is included, unless it falls on a weekend or state holiday, in which event the period runs until 5:00 p.m. on the next day that does not fall on a weekend or state holiday. Bernie Karl K&K Recycling Inc. P.O. Box 58055 Fairbanks, AK 99711 Gordon Severson 3201 Westmar Cir. Anchorage, AK 99508-4336 Penny Vadla 399 W. Riverview Ave. Soldotna, AK 99669-7714 George Vaught, Jr. Darwin Waldsmith Richard Wagner P.O. Box 13557 P.O. Box 39309 P.O. Box 60868 Denver, CO 80201-3557 Ninilchik, AK 99639 Fairbanks, AK 99706 INDEXES KE March 19, 2019 Commissioners Alaska Oil and Gas Conservation Commission 333 West 71h Ave, Suite 100 Anchorage, AK 99501 RE: Prudhoe Bay Unit Lisburne Oil Pool Spacing Exception Application L5-27 Development Oil Well Dear Commissioners: BP Exploration (Alaska) Inc 900 East Benson Boulevard P O Box 196612 Anchorage. Alaska 99519.6612 (907)561-5111 RECEIVED MAR 2 1 2019 A OGCC BP Exploration (Alaska), Inc (BPXA), as operator of the Prudhoe Bay Unit, requests that the Commission grant a spacing exception via Administrative Approval for the L5-27, which BPXA would like to spud in May, 2019. BPXA is requesting an exception specifically to the following provision of CO 207B Rule 3: The well spacing unit shall be one producing well per governmental quarter section. The planned well will be compliant with the other two provisions of Rule 3. Please refer to Exhibit 1. • BP is the operator for the affected lease (ADL034631) and all surrounding leases; • there are no property boundaries within 500' of the well where ownership and landownership changes; • the chosen Lisburne reservoir trajectory for L5-27 (orange color below black circle of Top Lisburne) is more than 500' from the external boundary of the Affected Area of the Lisburne Oil Pool; • L5-27 will open the Lisburne Oil Pool more than 1,000' from the nearest well open to that same oil pool. However, L5-27 is planned to lie within the same governmental quarter section as another producing well that is open to the pool: L5-21, (has a portion of its perforations within the same quarter section). 1. The subject well's Lisburne reservoir interval will be in the southwestern quarter of the northeast quarter of section 3 (TI IN, R15E). 2. L5-21 is in the northern half of the northeast governmental quarter section of section 3. LS -27 will also be over 1,800' from any open pay in LS -21. Commissioners L5-27 Spacing Exception Application March 19, 2019 Geology supporting BPXA's proposed trajectory for L5-27 and the statements will be reviewed with an AOGCC staff geologist in a confidential technical meeting as part of this application. A top Lisburne structure map will be presented and discussed. Resource access would be forfeited if conformance to the one producing well per governmental quarter section spacing requirement of CO 207B was required, on account of geology. The requested exception does not promote waste or jeopardize correlative rights, promotes greater ultimate recovery, and is based on sound engineering and geoscience principles, and will not result in an increased risk of fluid movement into freshwater aquifers. If you have any questions regarding this request please contact Bill Bredar at 564-5348 or through email at William.bredar@bp.com. Respectfully, Katrina Gamer West Area Manager/Reservoir Management, Prudhoe Bay Unit Alaska Reservoir Development, BPXA Cc: Eric Reinbold, ConocoPhillips Alaska, Inc Jeff Farr, ExxonMobil Alaska, Production Inc Dave White, Chevron USA Dave Roby, AOGCC Exhibit 1 to 1-5-27 Spacing Exception Application, BP Exploration (Alaska) Inc w 0 Exhibit 1 to 1-5-03 Spacing Exception Application, BP Exploration (Alaska) Inc m 3 SE March 14, 2019 Commissioners Alaska Oil and Gas Conservation Commission 333 West 7w Ave, Suite 100 Anchorage, AK 99501 RE: Prudhoe Bay Unit Lisburne Oil Pool Spacing Exception Application L5-03 Development Oil Well Dear Commissioners: BP Exploration (Alaska) Inc. 900 East Benson Boulevard P.O. Box 196612 Anchorage. Alaska 99519-6612 (90 7) 561-5111 :9:IIFD MAN 19 2019 BP Exploration (Alaska), Inc (BPXA), as operator of the Prudhoe Bay Unit, requests that the Commission grant a spacing exception via Administrative Approval for the L5-03, a horizontal oil well, which BPXA would like to spud in late April, 2019. BPXA is requesting an exception specifically to the following provision of CO 207B Rule 3: The well spacing unit shall be one producing well per governmental quarter section. The planned well will be compliant with the other two provisions of Rule 3. Please refer to Exhibit 1. • BP is the operator for the affected leases (ADL028320 and ADL034631) and all surrounding leases; • there are no property boundaries within 500' of the well where ownership and landownership changes; • the chosen Lisburne reservoir trajectory for L5-03 (yellow color below black circle of Top Lisburne) is more than 500' from the external boundary of the Affected Area of the Lisburne Oil Pool; • L5-03 will open the Lisburne Oil Pool more than 1,000' from the nearest well open to that same oil pool. However, L5-03 is planned to lie within the same governmental quarter sections as other producing wells that are open to the pool; 1. The subject well will be in both section 11 and section 3 (TI 1N, RI 5E). 2. L5-01 is located in the southern half of the northeast governmental quarter section of section 11. The subject well will drill north of L5-01 and will be in the northernmost part of this same governmental quarter section. L5-03 will also be over 1,200' from any open pay in L5-01. 3. L5 -17A is located in the northern half of the southeast governmental quarter section of section 3. The subject well's planned trajectory is to Commissioners L5-03 Spacing Exception Application March 14, 2019 reach TD in the SE portion of the SE quarter of S 3. The TD of L5-03 is planned to be over 1,500' open pay in L5 -17A. • Geology supporting BPXA's proposed trajectory for L5-03 and the statements above were reviewed with an AOGCC staff geologist in a confidential technical meeting on March 12, 2019. A top Lisburne structure map was reviewed. Resource access would be forfeited if conformance to the one producing well per governmental quarter section spacing requirement of CO 207B was required due to geology. • The requested exception does not promote waste or jeopardize correlative rights, promotes greater ultimate recovery, and is based on sound engineering and geoscience principles, and will not result in an increased risk of fluid movement into freshwater aquifers. If you have any questions regarding this request please contact Bill Bredar at 564-5348 or through email at William.bredar@bp.com. Respectfully, -6(— Katrina Garner West Area Manager/Reservoir Management, Prudhoe Bay Unit Alaska Reservoir Development, BPXA Cc: Eric Reinhold, ConocoPhillips Alaska, Inc Jeff Farr, ExxonMobil Alaska, Production Inc Dave White, Chevron USA Dave Roby, AOGCC Notice of Public Hearing STATE OF ALASKA ALASKA OIL AND GAS CONSERVATION COMMISSION Re: Docket Numbers: AIO-16-042 and CO-16-018 The application of BP Exploration (Alaska) Inc. (BPXA) to convert the Prudhoe Bay Unit's (PBU) Lisburne Oil Pool (LOP) gas cap water injection (GCWI) pilot project to a permanent project. BPXA, by letter dated September 26, 2016, requests the Alaska Oil and Gas Conservation Commission (AOGCC) issue an order authorizing the PBU LOP GCWI project as a permanent development project instead of the pilot project it is today. The AOGCC has tentatively scheduled a public hearing on this application for November 3, 2016, at 9:00 a.m. at 333 West 7th Avenue, Anchorage, Alaska 99501. To request that the tentatively scheduled hearing be held, a written request must be filed with the AOGCC no later than 4:30 p.m. on October 15, 2016. If a request for a hearing is not timely filed, the AOGCC may consider the issuance of an order without a hearing. To learn if the AOGCC will hold the hearing, call 279-1433 after October 20, 2016. In addition, written comments regarding this application may be submitted to the AOGCC at 333 West 7th Avenue, Anchorage, Alaska 99501. Comments must be received no later than 4:30 p.m. on November 1, 2016, except that, if a hearing is held, comments must be received no later than the conclusion of the November 3, 2016 hearing. If, because of a disability, special accommodations may be needed to comment or attend the hearing contact the AOGCC at (907) 279-1433 no later than October 27, 2016. Cathy . Fo re ster Chair, Commissioner • • Diane Richmond Performance and Data Management Team Lead BP Exploration (Alaska), Inc. P.O. Box 196612 Anchorage, AK 99519-6612 (!:�_ 3c)-�� 242'Mm Notice of Public Hearing STATE OF ALASKA ALASKA OIL AND GAS CONSERVATION COMMISSION Re: Docket Numbers: AIO-16-042 and CO-16-018 The application of BP Exploration (Alaska) Inc. (BPXA) to convert the Prudhoe Bay Unit's (PBU) Lisburne Oil Pool (LOP) gas cap water injection (GCWI) pilot project to a permanent project. BPXA, by letter dated September 26, 2016, requests the Alaska Oil and Gas Conservation Commission (AOGCC) issue an order authorizing the PBU LOP GCWI project as a permanent development project instead of the pilot project it is today. The AOGCC has tentatively scheduled a public hearing on this application for November 3, 2016, at 9:00 a.m. at 333 West 7th Avenue, Anchorage, Alaska 99501. To request that the tentatively scheduled hearing be held, a written request must be filed with the AOGCC no later than 4:30 p.m. on October 15, 2016. If a request for a hearing is not timely filed, the AOGCC may consider the issuance of an order without a hearing. To learn if the AOGCC will hold the hearing, call 279-1433 after October 20, 2016. In addition, written comments regarding this application may be submitted to the AOGCC at 333 West 70' Avenue, Anchorage, Alaska 99501. Comments must be received no later than 4:30 p.m. on November 1, 2016, except that, if a hearing is held, comments must be received no later than the conclusion of the November 3, 2016 hearing. If, because of a disability, special accommodations may be needed to comment or attend the hearing contact the AOGCC at (907) 279-1433 no later than October 27, 2016. //signature on file// Cathy P. Foerster Chair, Commissioner STATE OF ALASKA ADVERTISING ORDER NUMBER ADVERTISING NOTICE TO PUBLISHER SUBMIT INVOICE SHOWING ADVERTISING ORDER NO., CERTIFIED ORDER AFFIDAVIT OF PUBLICATION WITH ATTACHED COPY OFADVERTISMENT. AO-17-008 FROM: AGENCY CONTACT: Jody Colombie/Samantha Carlisle Alaska Oil and Gas Conservation Commission DATE OF A.O. AGENCY PHONE: 333 West 7th Avenue 09/29/16 1(907) 279-1433 Anchorage, Alaska 99501 DATES ADVERTISEMENT REQUIRED: COMPANY CONTACT NAME: PHONE NUMBER: ASAP FAX NUMBER: (907)276-7542 TO PUBLISHER: SPECIAL INSTRUCTIONS: Alaska Dispatch News PO Box 149001 Anchorage, Alaska 99514 .� LEGAL blS" /kY CLASSFF D �;' OTHER (Specify belowrj ii�lljll I Put ft 1 i I DESCRIPTION PRICE AIO 16-042 and CO-16-018 Initials of who prepared AO: Alaska Non -Taxable 92-600185 Department of Administration stI$ ilT l......i.. I .R.... D....... Division AOGCC O;RDEl2iY0„.OER7IF FD;a�F I AvJi;OF;.; of Eae .................................. EUBL............ ATTACHEP:gOP.Y OF 333 West 7th Avenue ......i.. TSI4ILW Y 1 Oi.:.:.:.:.:.:.: : .............. ........ Anchora e, Alaska 99501 Pa e 1 of 1 REF Type Number Amount Date Comments I PvN ADN89311 2 Ao AO-17-008 3 4 FIN AMOUNT Sy Appr Unit PGM LGR Object FY DIST LIQ 1 17 021147717 3046 17 2 3 5 Purchasi file: fl ffhS1' Purchasing Authority's Signature Telephone Number 1 .0. an ceiw n name must appear on all invoices and documents relating to this purchase. Th state is registered for tax free transactions �rsal Z. under Chapter 32, IRS code. Registration number 92-73-0006 K. Items are for the exclusive use of the state and not for DISIItIB..TI.4N::::::........................................ ..... ........... :::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::......:::::::::::::::::: ....•....•........ ;: ©Co Dl,isiori;Fiscal/Qrigirial A..............P..............(.....)..............,.........8.......................................... Ptiliiisher:.faxeil :l)iivisibri Fiscal : 2eeeiviri..................................... .... . Form:02-901 Revised: 9/29/2016 270227 0001393657 $189.26 STATE OF ALASKA RECEIVED OCT 062016 AFFIDAVIT OF PUBLICATION AOGCC THIRD JUDICIAL DISTRICT Emma Dunlap being first duly sworn on oath deposes and says that he/she is a representative of the Alaska Dispatch News, a daily newspaper. That said newspaper has been approved by the Third Judicial Court, Anchorage, Alaska, and it now and has been published in the English language continually as a daily newspaper in Anchorage, Alaska, and it is now and during all said time was printed in an office maintained at the aforesaid place of publication of said newspaper. That the annexed is a copy of an advertisement as it was published in regular issues (and not in supplemental form) of said newspaper on September 30, 2016 and that such newspaper was regularly distributed to its subscribers during all of said period. That the full amount of the fee charged for the foregoing publication is not in excess of the rate charged private individuals. Subscribed and sworn to before me this 30th day of September, 2016 Notary Public in and for The State of Alaska. Third Division Anchorage, Alaska MY COMMISSION EXPIRES ca�&5ZaLl Nonce of WC Hearing STATE OF ALASKA ALA,SKA OIL AND GAS CONSERVATION COMMISSION Re: I Docket Numbers: AIO-16-042 and CO-16-018 The application of BP Exploration (Alaska) Inca (BPXA) to convert the Prudhoe Bay Unit's (PB ) Lisburne Oil Pool (LOP) gas cap water injection (GCWI) pilot project to a permanent project. gpXA, by letter dated September 26, 2016, requests the Alaska Oil and PBU LOp CWI prof crt ass a' permanent) de elopment prauthorizing ject instead of the pilot project it is today. The AOGCC has tentatively scheduled a public -hest 7 v this application for November 3, Z016eegqat 9:00 a.m. at 333 West 7th Avenue Anchorage, held ka written requestumust be file twith the AOGCC lno hearing 6bee later than 4:30 p.m. on October 15, 2016 If a request for a hearing is not timely filed, ther AOGCC maYy consider the issuance of an order without a hearing. To learn if the 4OGCC Will hold thehearin&,call 279-1433 after October 20, 2016.. in addition written comments regarding this application may. be submitted CommeAOGCC nts Must at received no laterth ethan Anchorage, 30 p mAla Alaska November 1 2016 except that if a hearing is held comments must be received no later-tfian the conclusion of the November 3, 2016 hearing - If, because of a disability special accommodations may be needed to comment or attend the hearing contact the AOGCC at (907) 279-1433 no later than October 27, 2016. Hsi nature, P Foerster Chair, Commissioner Published: September 30,2016 otE iy u1-iis BRttt"fEYI. i;CPat'S(�=+,'' ,f C . Colombie, Jody J (DOA) From: Colombie, Jody J (DOA) Sent: Thursday, September 29, 2016 2:41 PM To: Ballantine, Tab A (LAW); 'Ballantine, Tab A (LAW) (tab.baIlantine@alaska.gov)'; 'Bender, Makana K (DOA) (makana.bender@alaska.gov)'; 'Bettis, Patricia K (DOA) (patricia.bettis@alaska.gov)'; 'Bixby, Brian D (DOA)'; 'Brooks, Phoebe L (DOA) (phoebe.brooks@alaska.gov)'; Carlisle, Samantha J (DOA); 'Colombie, Jody J (DOA) Oody.colombie@alaska.gov)'; 'Cook, Guy D (DOA)'; 'Davies, Stephen F (DOA) (steve.davies@alaska.gov)'; Eaton, Loraine E (DOA); 'Foerster, Catherine P (DOA) (cathy.foerster@alaska.gov)'; 'French, Hollis (DOA)'; Trystacky, Michal (michal.frystacky@alaska.gov)'; 'Grimaldi, Louis R (DOA) (lou.grimaldi@alaska.gov)'; 'Guhl, Meredith (DOA sponsored) (meredith.guhl@alaska.gov)'; Herrera, Matthew F (DOA); 'Hill, Johnnie W (DOA)'; 'Jones, Jeffery B (DOA) (Jeff Jones@alaska.gov)'; Kair, Michael N (DOA); 'Link, Liz M (DOA)'; Loepp, Victoria T (DOA); 'Mumm, Joseph (DOA sponsored) Ooseph.mumm@alaska.gov)'; 'Noble, Robert C (DOA) (bob.nob le@alaska.gov)'; 'Paladijczuk, Tracie L (DOA) (tracie.paladijczuk@alaska.gov)'; 'Pasqual, Maria (DOA) (maria.pasqual@alaska.gov)'; 'Quick, Michael (DOA sponsored)'; 'Regg, James B (DOA) Oim.regg@alaska.gov)'; 'Roby, David S (DOA) (dave.roby@alaska.gov)'; 'Scheve, Charles M (DOA) (chuck.scheve@alaska.gov)'; 'Schwartz, Guy L (DOA) (guy.schwartz@alaska.gov)'; 'Seamount, Dan T (DOA) (dan.seamount@alaska.gov)'; 'Singh, Angela K (DOA) (angela.singh@alaska.gov)'; 'Wallace, Chris D (DOA) (chris.waIlace@alaska.gov)'; 'AK, GWO Projects Well Integrity'; 'AKDCWellIntegrityCoordinator'; 'Alan Bailey'; 'Alex Demarban'; 'Alexander Bridge'; 'Allen Huckabay'; 'Andrew VanderJack'; 'Ann Danielson'; 'Anna Raff'; 'Barbara F Fullmer'; 'bbritch'; 'Becky Bohrer'; 'Bill Bredar'; 'Bob'; 'Brian Havelock'; 'Bruce Webb'; 'Caleb Conrad'; 'Candi English'; 'Cocklan-Vendl, Mary E'; 'Colleen Miller'; 'Crandall, Krissell'; 'D Lawrence'; 'Dale Hoffman'; 'Dave Harbour'; 'David Boelens'; 'David Duffy'; 'David House'; 'David McCaleb'; 'David Tetta'; 'ddonkel@cfl.rr.com'; 'DNROG Units'; 'Donna Ambruz'; 'Ed Jones'; 'Elizabeth Harball'; 'Elowe, Kristin'; 'Evan Osborne'; 'Evans, John R (LDZX)'; 'Gary Oskolkosf'; 'George Pollock'; 'Gordon Pospisil'; Greeley, Destin M (DOR); 'Gregg Nady'; 'Gretchen Stoddard'; 'gspfoff'; Hyun, James J (DNR); 'Jacki Rose'; 'Jdarlington Oarlington@gmail.com)'; 'Jeanne McPherren'; 'Jerry Hodgden'; 'Jerry McCutcheon'; 'Jim Watt'; 'Jim White'; 'Joe Lastufka'; 'Joe Nicks'; 'John Burdick'; 'John Easton'; 'Jon Goltz'; 'Juanita Lovett'; 'Judy Stanek'; 'Julie Little'; 'Karl Moriarty'; 'Kasper Kowalewski'; 'Kazeem Adegbola'; 'Keith Torrance'; 'Keith Wiles'; 'Kelly Sperback'; Kruse, Rebecca D (DNR); 'Laura Silliphant (laura.gregersen@alaska.gov)'; 'Leslie Smith'; 'Louisiana Cutler'; 'Luke Keller'; 'Marc Kovak'; 'Mark Dalton'; 'Mark Hanley (mark.hanley@anadarko.com)'; 'Mark Landt'; 'Mark Wedman'; 'Marquerite kremer (meg.kremer@alaska.gov)'; 'Mealear Tauch'; 'Michael Bill'; 'Michael Calkins'; 'Michael Moora'; 'MJ Loveland'; 'mkm7200'; Munisteri, Islin W M (DNR); 'nelson'; 'Nichole Saunders'; 'Nikki Martin'; 'NSK Problem Well Supv'; 'Patty Alfaro'; 'Paul Craig'; 'Paul Decker (paul.decker@alaska.gov)'; 'Paul Mazzolini'; Pike, Kevin W (DNR); 'Randall Kanady'; 'Rena Del bridge'; 'Renan Yanish'; 'Richard Cool'; 'Robert Brelsford'; 'Ryan Tunseth'; 'Sara Leverette'; 'Scott Griffith'; 'Shannon Donnelly'; 'Sharmaine Copeland'; 'Sharon Yarawsky'; Shellenbaum, Diane P (DNR); Skutca, Joseph E (DNR); 'Smart Energy Universe'; Smith, Kyle S (DNR); 'Stephanie Klemmer'; 'Stephen Hennigan'; 'Sternicki, Oliver R'; 'Steve Moothart (steve.moothart@alaska.gov)'; 'Steve Quinn'; 'Suzanne Gibson'; 'Tamers Sheffield'; 'Ted Kramer'; 'Temple Davidson'; 'Teresa Imm'; 'Thor Cutler'; Tim Jones; 'Tim Mayers'; Todd Durkee; trmjrl; 'Tyler Senden'; Umekwe, Maduabuchi P (DNR); Vinnie Catalano; Weston Nash; Whitney Pettus; 'Aaron Gluzman'; 'Aaron Sorrell'; Ajibola Adeyeye; Alan Dennis; Assmann, Aaron A; Bajsarowicz, Caroline J; Brian Gross; 'Bruce Williams'; Bruno, Jeff J (DNR); Casey Sullivan; Catie Quinn; To: 'Don STt'aw'; Eric Lidji; Garrett Haag; 'Graham SmithQak Dickenson; Heusser, Heather A (DNR); Holly Pearen; Jamie M. Long; 'Jason Bergerson'; 'Jim Magill'; Joe Longo; John Martineck; Josh Kindred; Laney Vazquez; Lois Epstein; Longan, Sara W (DNR); Marc Kuck; Marcia Hobson; 'Marie Steele'; Matt Armstrong; 'Mike Franger'; Morgan, Kirk A (DNR); Pascal Umekwe; Pat Galvin; 'Pete Dickinson'; Peter Contreras; Richard Garrard; Richmond, Diane M; Robert Province; 'Ryan Daniel'; 'Sandra Lemke'; 'Susan Pollard'; Talib Syed; Tina Grovier (tmgrovier@stoel.com); Tostevin, Breck C (LAW); 'Wayne Wooster'; 'William Van Dyke' Subject: Public Notice Attachments: AIO-16-042 and CO-16-018 Public Hearing Notice.pdf Please see attached. Re: Docket Numbers: AIO-16-042 and CO-16-018 The application of BP Exploration (Alaska) Inc. (BPXA) to convert the Prudhoe Bay Unit's (PBU) Lisburne Oil Pool (LOP) gas cap water injection (GCWI) pilot project to a permanent project. Jody J. Co(omhie _AOGCC Specia(Assistant .Alaska odand (jas Conservation Commission 333 West 7"' .Avenue .Ancharage, Alaska 9.95ol Of f ive: (907) 793-1221 ,fax: (9)07) 276-7542 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 Jody Colombie at 907.793.1221 or iody.colombie@alaska.gov. Bernie Karl M Recycling Inc. Gordon Severson Penny Vadla P.O. Box 58055 3201 Westmar Cir. 399 W. Riverview Ave. Fairbanks, AK 99711 Anchorage, AK 99508-4336 Soldotna, AK 99669-7714 George Vaught, Jr. Darwin Waldsmith Richard Wagner P.O. Box 13557 P.O. Box 39309 P.O. Box 60868 Denver, CO 80201-3557 Ninilchik, AK 99639 Fairbanks, AK 99706 - � by September 26, 2016 • J 26 7016 Cathy P Foerster, Chair Alaska Oil and Gas Conservation Commission 333 West 7th Ave, Suite 100 Anchorage, AK 99501 BP Exploration (Alaska) Inc. P. 0.Box 196612 900 East Benson Boulevard Anchorage, AK 99519-6612 Re: Final Report and Application to Convert Pilot to Permanent Status Conservation Order 207A.002 and Area Injection Order 4E.038 (now 4F) Lisburne Gas Cap Water Injection (GCWI) Pilot Project — Well L5-29 Lisburne Oil Pool, Prudhoe Bay Unit Dear Chair Foerster: BP Exploration (Alaska), Inc., as operator of the Prudhoe Bay Unit and on behalf of the working interest owners, submits the attached Final Report of the referenced pilot project, and requests that the Commission amend its prior orders to authorize continued GCWI into the Lisburne Oil Pool We submit the attached Final Report for Lisburne Gas Cap Water Injection Pilot Project at L5-29 Well (07101114 — 07101116) pursuant to Conditions 4 and 5 of Conservation Order 207A.001 and Area Injection Order 4E.029, dated June 4, 2008. The Final Report discusses and documents the GCWI pilot period, and demonstrates that this GCWI method is a viable enhanced oil recovery process that leads to greater overall recovery from the Lisburne Oil Pool. The GCWI project going forward is not expected to be expanded to other areas of the Lisburne Oil Pool. The project will target water injection rates up to 20,000 bwpd in L5-29 for an estimated incremental oil recovery benefit of 100-350 bopd, or 0.5-3 MMSTBO. We request that the maximum injection limits be removed from the referenced commission order to allow for greater operational flexibility as our understanding of the reservoir progresses. We respectfully request that the Commission approve this request and make the referenced GCWI pilot project permanent, rename it the Lisburne GCWI Project, and allow GCWI into the Lisburne Oil Pool gas cap through Well L5-29 for enhanced Lisburne oil recovery. We propose to include an update of the Lisburne GCWI Project as part of the Lisburne Oil Pool Annual Surveillance Report, due June 15th of each year. Application to Conve0ot Project to Permanent Status CO 207A.002 AIO 4E.038 (now 4F) September 26, 2016 Page 2 Should you have any questions regarding this request please contact Bill Bredar at 907-564- 5348 and William.bredar@bp.com. Sincerely, 44a- A Diane Richmond Performance and Data Management Team Lead Enclosure: Final Report for Lisburne Gas Cap Water Injection Pilot Project at L5-29 Well cc: Mr. Eric Reinbold, ConocoPhillips Alaska, Inc Mr. Phil Tsunemori, ConocoPhillips Alaska, Inc Mr. Hank Jamieson, ExxonMobil Alaska, Production Inc Ms. Katherine Motteram, ExxonMobil Alaska, Production Inc Mr. Gerry Smith, ExxonMobil Alaska, Production Inc Mr. Phil Ayer, Chevron USA Mr. Dave White, Chevron USA RECEIVED FINAL REPORT FOR LISBURNE GAS CAP WATER INJECTION PILOT PROJECT AT L5-29 WELL (07/01/14 - 07/01/16) RESPONSE TO CONDITION NO. 5 UNDER ALASKA OIL AND GAS CONSERVATION COMMISSION ADMINISTRATIVE APPROVALS CO 207a.001 & AIO 4E.029 Submitted by BP as Operator on Behalf of the Prudhoe Bay Unit Working Interest Owners Dated: 9/01 /2016 Table of Contents • Executive Summary • Introduction — Objectives — Geologic Setting — Local Geologic Highlights for the L5-29 Area • Surveillance and Performance — Summary of Surveillance Activities — Injection History — Static Bottom -hole Pressure — Well Performance • Conclusion — Estimated Resource Recovery — Forward Plan Executive Summary The Lisburne L5 Gas Cap Water Injection (GCWI) pilot project began in July 2008 and terminated July 1st, 2016. Progress reports were submitted in 2011 and 2014 to the Alaska Oil and Gas Conservation Commission (AOGCC). This report will primarily cover the period following the last progress report, comprising the period of July 1st 2014 to July 1 st, 2016, as well as give a final overview of the pilot. Through the course of the pilot, 22.1 MMBW were injected into L5-29, a volume nearly two and a half times the volume of water injected during the L2 waterflood pilot of 1987- 1989. The GCWI pilot met the original five objectives of the pilot, however individual well performance was not consistent in behavior: Oil production has increased or decline has been suppressed in some of the offset wells. Pressure has increased approximately 300 psi since the start of the pilot. Gas/Oil Ratio (GOR) has been suppressed in some offset wells. L5-29 has been capable of injecting the desired rates during the pilot. Although hydrate problems related to GCWI occurred in some offset wells, it currently is providing a net positive oil benefit on the order of 100-350 bopd. This benefit has mostly been through sustained or increased fluid rates associated with higher reservoir pressure and suppressed gas rates. Although this is less than the aspired benefit of about 2,000 bopd, it has proven a greater technical success than the original L2 waterflood pilot. As the GCWI process has been successful in increasing oil production in the L5 area, the operator recommends continuing to inject into L5-29. At this time the Prudhoe Bay Unit working interest owners do not plan to expand the program of GCWI to other locations in the field due to the current low benefit and high cost of implementation at other drillsites, and scarcity of viable locations. Introduction Objectives The Lisburne L5 Gas Cap Water Injection (GCWI) initial pilot project had the following objectives: 1. Increase Lisburne oil production rates (primarily from L5 pad wells) 2. Provide pressure support to the Lisburne Reservoir, primarily in the L5 pad area 3. Reduce produced gas / oil ratios of L5 pad wells 4. Determine water injectivity for Lisburne wells 5. Evaluate gas cap water injection as a process that has potential to be expanded to other areas of the Lisburne gas cap to recover additional Lisburne oil Geologic Setting The Lisburne Field is the only producing carbonate field in Alaska (Figures 1 & 2). It is located approximately 250 miles north of the Arctic Circle at latitude of 71' N. The Lisburne Oil Pool encompasses some 39,200 acres (61 square miles). A significant portion of the Lisburne Oil Pool underlies the Prudhoe Bay Permo-Triassic reservoirs, separated by shale sequences. The Lisburne field was discovered in early 1968 with the drilling of the Prudhoe Bay State # 1 well by ARCO and Exxon. The Lisburne Oil Pool is defined by Rule 2 of Conservation Order No. 207. It is the accumulation of oil and gas found within stratigraphic sections that correlate with the stratigraphic section occurring in the Atlantic Richfield -Humble Prudhoe Bay State No. 1 well between the depths of 8,790 feet measured depth and 10,440 feet measured depth. The Lisburne Reservoir is a combination structural and stratigraphic trap of carbonate lithology. It is an anticlinal structure that is bounded on the north by the Prudhoe Bay- Niakuk fault complex, by the Lower Cretaceous Unconformity (LCU) truncation to the east, and by the Pre-Echooka Unconformity (PEU) truncation to the west. The unitized intervals are of Mississippian / Pennsylvanian age and include the Alapah and Wahoo formations of the Lisburne Group. Over the past eight years, the L5-29 GCWI Pilot Project injected seawater only into the Wahoo formation. I . ■ }ter LISBURNE FIELD WAHOO RESERVOIR - DRILL SITE LISBURNE US +y Ouu +3Wf0 5�.� .!r kCa cfit�Jsi3tl+t,'j F T. i � 1 • J ccwi+ni«wnwea .,� `_ 4 1538 LS-33 .545 Q .5-2$ DSW 1 ,.,, w ^ i A p„ '"--�'•-�--� .� -.-.� i - � tSi7 -. ^ � • y_ 4WYk iea Water One - L l TA t _ f '-e- -• _ p L30 .3-C3 • a O f ! 4 ! uu TOTAL DEPTH WELL LOCATION Figure 1: L5-29 Gas Cap Water Injector Location Plat Local Geologic Highlights for the L5-29 Area The area around L5-29 is geologically unique for the Lisburne field. Logs indicate 40%+ porosity enhancement locally (Figure 3) at the top of Wahoo Zone 6 from LCU exposure in the northernmost fault block. Wells L5-29 and L5-36 experienced large lost circulation events while drilling through this interval, and the drillers described it as a "cave". This super-porosity/permeability enhancement around L5-29 and L5-36 is not representative of matrix properties anywhere else in the field. The porosity enhancement is constrained by the Prudhoe Bay fault to the north and other major east -west faults to the south that appear to form a permeability barrier / baffle (Figures 4A, 4B and 4C). 11 599➢,m0 �5➢m �Am bwPm s9as,m➢ s9m,m➢ 597�,�p0 0 i s9T➢.mo 5965.m0 s9w,mp� s9ss.m➢ ST BEACH 02 ~jam ( L1-27 LGI-12 �i oGLGII--06 LS-25-31 33 JOLT\281...........� . Y--\ 8o J L& L L1-30 .�� LGI-02 �.,/ LI L �L 431 () L 21L`31 L1-14 LS L - IV170 L1_ ¢ i > 17 LS-18 L1-15 L1-10 L �16 L1- (• l L 11 L6_05 Lb01 1-�5-12 V Lis01 L 33 L*3!> 28 L, L 08 L8-04 L 2 L� 5L2--� jj_2t2-1 ®-206 ! L3�-12 q,, L —21 6 Lill W 3 18 Lb03 L:114 �18 � VV V l 0 -L411 ip V'LP21-2-d 1® 0 2 La- L2-03 L2-10 LJ30 4 LQ•1Q3 a-30 L 23 L�-01 L631 Lib 1-4-31 L4-32 L4-36 59 /5,m➢ ampm wpm empm r,F^pm sropm 6f5pm wpm 9.5 pm �➢Am 595 pm rmpm rm pm ?iopm ri5�t2_pm rmpm 175Am i1Ppm tupm Figure 2: Lisburne Field Fluid Contact Base Map with GCWI Pilot Figure 3: Log Suite Showing High Porosity at Top of Zone 6 Below LCU Gull-02 L5-29 L5-33 L5-18 I q, Z7 Z6 Z5 Z4 Z3x� /Z2 E :m LCU ACI 8500 9500 10000 Figure 4A: L5 West to East Structural Cross -Section L5-29 L5-33 NW 8500 9000 9500 10000 U) U) 10500 SE L5-31 / I L5-13 Z7 Z6 Z5 Z4 :n Z3 /Z2 Figure 413: L5 Northwest to Southeast Structural Cross -Section :L57-29 LS-36-28A LS-25 LS-28 GULL-02 y��`\ -9A L5-26 L5-21 N& L5-3 L5-23 LS-3 L5.24 -16AL2 LGI.04 _ _ _ L548 7 101K 2170G KIM .000 Figure 4C: L5 Pad Location Map for Structural Cross -Sections in Figures 4A and 4B Surveillance and Performance Summary of Surveillance Activities As a part of GCWI surveillance, Static Bottom -hole Pressures (SBHP) were measured in offset producers. L5-29 wellhead pressures and well performance of online producers were also monitored. Injection History Figure 5 illustrates the injection rate history along with periods when the injector was shut in during the reporting period of July 2014 through July 2016. As of July 1, 2016 the cumulative water injection reached 22.1 MMbbls. The current plan is to attempt to repair the well and continue injection. 20.000 18,000 16,000 0 14,000 a m 12.000 10,000 0 8.000 V 6,000 4,000 0 2.000 0 1 �'b L5-29 Injection L 11,0 Shut-in for choke change I .—Shut-in for well integrity �'b Ntk \a �5 Nb 4 No N" No 16 NOV,ZO 01 1\N\210\�\LO Figure 5: L5-29 Seawater Injection Rates for current reporting period Daily injection rates are plotted against wellhead pressure to investigate changes in L5-29 injectivity as shown in Figure 6. The rates and corresponding wellhead pressures are color coded by date. Figure 6 depicts a significant decrease in injectivity from year 2014 to 2015. This change does not represent the reservoir behavior as it is caused by installation of a different choke. 1.5-29 WHP vs Injection Rate 14W 1200 low ■ 400 ■ 200 ■ ■e■■ i ■ 0 7 ■ ♦1;12014-6/3Dj2D14 ■71i2014-121ft /2014 . 1:1 2015-613W2015 1. 711i2015.12/31?2015 � i i 1J1;'20166; 3D/ID16 i 8000 1o000 12000 14000 16000 18000 20)(10 Daily Injection Rate jbwpd) Figure 6: L5-29 WHP vs. Injection Rate Static Bottom -hole Pressure Frequent static bottom -hole pressures were measured for surveillance in the offset producers and showed pressures increased by—100-150 psi in the first row of offset producers (Figure 7) during this reporting period,—350-400 psi in total increase in pressure from 2008. The pressure increase shown on Figure 8 is likely due to a combination of lower withdrawal rate and the pressure support from the GCWI pilot well. Recent production from these wells is lower than before the injection start-up, and the entire L5 drillsite was temporarily down due to corrosion in the pad production export line during the reporting period. 9 1st Row of Producer 2tiA 5-29 5-36 tzr 2ooe L5- _ o 1i5-25 ;1 JL 8AL _ -26 _5- -- -23 L-21 1 5 5 zois L52 L5-24 L1-14 -- , L5-09 __ _ JL543 �.,517A_ _ ._. :..... L5-16A L2-32 L"5 L5-01 L5-12 _ 1-3-02 J_2-30 L2-28 L3-05, ,__ L5-08 L5-04 J-2-26 Figure 7: First Row of Producers Location Map with Year of Seawater Breakthrough • L5-23 ■ L6-28 ♦ LS-21 . L5-31 ■ LS-33 • L5.36 • L5-28A Prod Res bbi Rate —LS-29 (GCWI) Injecti71al. 3900 70000 3850 3800 3750 60000 3700 3650 50000 c 3600 A al! ji 3550 Am0 na 3500 • + 40000 a m 3450 — Y ) � Y 3400 30000 a w 3350to 3300 3250 fll!- - - 20000 3200 # - - 3150 i - - - - -- 10000 3100 - - - - 3050 - - 3000 - 0 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 Figure 8: Static BHP/Production Plot for First Row of L5 Pad Producers Well Performance Figures 9-17 depict the production performance history of five offset producers. The top plot in each figure is well test information (oil/water/gas rates and GOR/WC), and the bottom plot shows monthly average GOR vs. cumulative oil production on the X-axis. Presently, the signs of incremental oil benefit during the GCWI pilot are based on the individual well production history, and are on the order of 100-350 bopd. This benefit has largely been from suppressed GOR, and increased fluid rates. Not every well surrounding L5-29 has shown a positive benefit, as associated water production has caused hydrate problems in some of the offset wells. Well performance trends have also been masked or affected by other factors outside of GCWI such as pad and facility downtime. Figure 18 is a semi -log plot of GOR vs. cumulative oil production for L5-23, L5-28A, 1-5-31, L5-33, and L5-36 combined. The pre-GCWI trend is drawn to show GOR increase with respect to the cumulative oil production. The flattening of GOR trend (circled in the figure) since the injection began may be an indication of improved recovery. GOR trends may also be artificially affected by the facility limitations and the maturity of many wells across multiple fields. Seawater breakthrough took has been observed in producers L5-28A, L5-32, L5-33 and L5-36 (Figures 13, 15, 16, 17). Observed estimated benefits and comments may be found in Table 1. oQna LOA7A*Lb17A Typo,*—pom MOt" M&Oft 0"VPW40WU •� �"i4•.e...,e....�...m__.........,.m.»,�.r...._»e.a_, �....�®.._..._�.. low— ; GCWI Start-up ` na° + Sono �00 Oil Rate goo (bopd) ?ODDD 1400- Water Rat taooO !200 - (bwpd) GOR ea D (scf/bbl) ooD � eaODD V Increase in wo $DDT Cil Rate WDaD Dc too o 400 � t w Gas ate Watercut(%) b0 (tea DODO 00 ) 00 Ot nt Da O$ ,o a re -�„Tu qi, RAN '4,: Tn 9sa RnR,uJ-CiO—,lil Trt=n�l.�R�te 0—lRtiTKCiOR lM:B01i %�:RZ)TM WC tYe; 10000010 -(- WOOD GCWI Start-up --> 2D,• Year If $DODO- tO, =ONO r Mb 0060 1000 -------- � . a: GOR ..a — (scf/bbl) ssa avoOo.. ,s$t 9^ E 1 20000 - 10000 ,Da$ got 9 ,5D Ono D -M D T'D 0900 0. 1:0 .... . t. R, ... Cumulative Oil Production (MMSTB) Figure 9: Well Performance: L5-17 wma 132, w L"I taa. am Fe Mc a wso°E �a. PN zero zoon".�-. ± ,aoo� watercut(%) f _i .ua GCWI Start-up ,oanzr a000a so 0 aoono aoa +soo— water Rate :aa (b-pd) a000n en o ,on .!DILRai@.-.. E� •9 a aaa — ena — C1b wona wo a0000 san Gas Rat as a i ?vanoo ioo S� �taK s °o 0 t. o " oe as an av •a ,• ,� +e a000a — ronao + GCWI Start-up eooao � Year i =5 z GOR i I (scf/bbl) a000a z0000 — ,oQoo — m +aa: 'ass ILI - - .. Cumulative Oil Production (MMSTB) r-'---- i• g— v iv. vv eii reriormance: L'-Li L` ftm tb23 0 L60 Type 6m FOeIW: 101 CC" of BORE. Way Plod 2 blR t00000;Rlt Water Rate GCWI Start-up o 1w2.. (bWPd) .. wood _ Moo .. Oil Rate too 0000 lob two (bopd) +zoo ' eooao coo w Dedinq 9 50000 uPPr an GOR '° o soo (scf bl) ."00 w o to I Gas ate eoo (sdd 300 20000 zao - Watercut (%) I0000 10 0 0 a DG Dt 02 02 D. D! 04 0- 08 09 14 t6 O7iLl)T.011 RW 1-MIJT'r—R—Jm4tV-JLI)TYW. kV C)-lRt)Tu00RiWbbh A-IR2t TNWem tow ® 0:20 1N 2.f4 :8< 31D 132 !01 474 0.8 Cumulative Oil Production (MMSTB) Figure 11: Well Performance: L5-23 • • I GOR 40000 j [G�Iart-up (scf/bbl) 4o a eaaan �oaoo eoaoo `06 3a3 _ I o I wnoo Oil Rate Gas Rate »aco A _ (boo) I ifd we :oaoo Water Rate a 000a b OC 0 Watercut(%) +no Oi Oa O^ OQ a' AB 0 �;�+, TK 4++R�•; eta,: iK tip, Ra+e'M:aT�I'; iKeo�rasu �Rl, to Gba tKlCW., �;RS)TK vrO i%u J GCWI Start-up ro„ wag xoR [ TSea ! moon — I eh4t :nuoo Year fOG03 f � 0 :00 n po O MO o C0a ' +M t 20 , �O t4lG I "`a""°'"a"'•' Cumulative oil Production (MMSTB) + Figure 12: Well Performance: L5-25 Man►: LWMA IO: tMMA Tap: %ft Rdm,rW Q0y 4f *6W! OWr 0Md. 2 Mr4 ,800 T GCWI Start-up WOOD x0 ,800 + Watercut (%) ►0000 Oil Rate x Increasein —* eo0 tD0" 1boPd) i o R wacutert 70000 00 moo he JOW s000a wo a0o tyi t ,f 4. i' 4 • 0 ° o Q »000 300 aoo y. e $ � 20w me Water Rate m0► Decrease In is (bWpd) Gas Rate = ,0ooa 00 B 0 ° as x or 0► oM ,0 t, ,� 10 0 Lt>Tsl Oil Rs,�-�R±i TaI Opt R�,a{M Q)O-(Lt)TVWwrRw Q-1R,)TMOORid'6W) M-(R2)T91RCrr) 10000010,17 , T 90000_ GCWI Start-up ro,. 00000 - +000o w t Year Decrease in zoaa ma=. 00000 — 0000 GOR 40000 GDR ,yys (�/bbl) 00000 of t45! 20000 ' ,0000 ±99: , MaB a OOaMO 00920 O±M :, tsa 0.200 o„„"E 0.a72 OaM M6 Data 0a0p tm+CkO)•iW,),.. Cumulative Oil Production (MMSTB) Figure 13: Well Performance! 1,5-2RA e w...ua, m ua, .,...a. � �eDD•,aoo,�:°MyR,00-20rrY + _I.00000iRef TI 50004 DDD GCWI Start-up o woo BD D ,.so +. *oOOD Oil Rate Water Rate 60R °DO ,20D - ftpd) IbWP�I P (scf/bbl) ro9aD 60 a -..... Y.— _.... 5G 0 so n p I e a 09 Mo i Gas Rate S Woo l9 0 i o 8 , z0DOD ]D0 204 V • Is IsWatercut % 41 DO 0+ Iti, 6: W 01 Do, O s; I• � .. . ,DODO iD6 0 0 Od oT so Do to CaOR fyC DG+ %-1R2}t,I KC{Mi It -1l+I ist 0,1 A— iR+; TU Gss R.N rya q;.-{�t�TR p'sAr RAN o-tR+. TR 40DDD +� so Do-' T0909 - GCWI Start-up Zo!. zo++ Moo - A000 ----•- Year I098 20D^ !ssa ,ss± .D000 - Moo - SOOOD f 'ODDO - (scf/bbl) '9S2 ses 9 �. twR;m.a xb. fRa; xear 0D5iA O+'±0 .; _a D3BC D.95 9±9a o603 Cumulative Oil Production (MMSTB) D>91 0R9' - 98D Figure 14: Well Performance! E IA —L522'a Lo-32 -r"a aw Fame Lol cqw a4 soiw: owtip ft4d 2 . . .. ... .... . .. GCWI t woo too Iwo $00oo Oil Rate (bopd) Tooao toga Wa ter Rate GOR Woo bv (pd) 91 (scf/bbl) Increase ir °00 oil Dec easein wo0oo 4 r Gas atiA 200 Watercut(%) Gas Rate- --13afd 0 la,"; TV 0" P... —RIITIOO :tW; —RZTMWC,f; smo som Kcw:l Start-up 21" 70000 De�jreas An woob .0.0- G 4=0 Yea w000 t i L Jscf/bbl) 280 05N0 06. Cumulative Oil Production (MMSTB) 21 '5'2 Figure 15: Well Performance: L5-32 GCWI Start-u]' ,L� t it Rate row° too +40 b0pd) LL°90 Water Rate 700 1200 -' jbwpd) GOR. Co (scf/bbl) o L0 o S0 0 .00 F 2° 000 8 e s l Gas Rate (� wo ,sumo Lz 2W !t A r 'a ♦= + Watercut (%) Moo ,o o 0 00 01 02 03 04 09 AL 07 as 09 io + ,3 i4 ,9 ,9 ° 4-lai) TAGM R,y ad'°)V-a,) TM W„M Its* O-;a+) TV GCa iW W) %-,R2) to WC i%; GCWI Start-up sow h N„ cn000 �- Year 2606 i0o0 .0wo + GOR .2 xacro + 20M — ,0000 (scf/bbl) +ssz +Ms 0 0 tw o 2i0 .420 0 Mo o too C Lw o so + 2 Cumulative Oil Production (MMSTB) Ms Figure 16: Well Performance: L5-33 Nana: Lam ID: tam rfw ev. F mot to) Can of Wftfl 0") Pm0 2 �_. _.. .. .._.._ _... S. .�...-. .. .____. ,_.. ..__.. _. ..-.. _. ,oak::. GCWI Start-up watercuc�►,o ,eo0 _ aoMu ,Mo , k Increase in soc Watercut 1000 aterRate 200 _ jhwpd) Oil Rate to o 4 GOR e0000 (bopd 5Do aoD c Nx ' dd $ a000c OWN a Gas Rate aoo ..o (�, ouou * 1000O 20D d , C too 00 01 01, Ot 0, 08 Oa 10 12 ti t! 16 O-dL,i TY QI R.0 ';Ts!G.t R.e. ,.e:c�0-.: .,a: S4...rRw ❑-:R,'. 1sl OOR iv1'!RY %-A2}TRWCf%I t - t�rR11 IOOOOat'� t � t , GCWI Start-up — 20t. WON- 20„ TWOO T 2009 moo + MOOD02 •AD W5 30000 T 20pD0 r ,992 GOR (scf1bbl) ,uaa ,ouoc ,eae 0 a lac O CdC 9lTO ttE , •. 1 W 212 26, :90 • •• Cumulative Oil Production (MMSTB) Figure 17: Well Performance: L5-36 • • 0 _a____ - Va. %-Ulliu.auve vu rrouuction for L5-23, L5-28A, L5-31, L5-33 and L5-36 Table 1: Estimated Benefit of L5-29 on Nearby Wells L5-29 Gas Cap Water Injection Estimated Benefit Well Estimated 2016 IOR bo d Breakthrough Year Approximate Distance ft Comments L5-17A 100 N/A 7400 Well has increased in oil Production, althou h also has had Ion eriods of bein shut in for as rodudion. L5-21 0 N/A 4650 Well has a history of hydrate problems, and was offline from January 2006 to May 2016 due to integrity problem which has since been resolved. L5-23 25 N/A 5300 Fluid rate decline became near zero in 2009. LS-25 0 N/A 4250 Non -operable well, has been shut in for almost entirety of pilot and a reservoir P&A has recently been executed. L5-28A 200' 2013 6150 Wellwas previously high gas rate well with ow ontime. Well now has mu lower gas rate, but a so a higher watercut and now requires a gas lift line (pending installation). Benefit derived from increased ontime and lower GOR. Estimated benefits assume successful well after adding gas lift. Due to poor ontime while waiting for gas lit, actual 2016 benefit Is near 0 bopd. 1-5-31 0 N/A 5900 High GOR well with low ontime and hydrate problems. Shut-in since 2012. 1-5-32 50 2015 9235 Benefit may be from injection in L6-19 (2,800 It away). Well recently cycled on (June 2016) at higher fluid rates and reduced gas production. Well will now likely require installation of gas lift line with the higher WC and lower GOR. Evidence of seawater rodudion not obtained until Jury 2016, but early shift in trends began in Fall 2015. L5-33 -25 2009 3550 Well has had hydrate problems since 2009, and has not been able to sustain production since 2010 despite multiple hydrate remediation attempts. L5-36 -30 2011 5000 Well developed hydrate problems with the water production and has had trouble sustaining production despite hydrate remediation attempts. Higher watercut has also offset increased fluid rates, resulting in an overall lower oil rate. 0 • Conclusions Estimated Resource Recovery 1. Reservoir pressure has increased around L5-29, resulting in greater fluid production rates. 2. GOR suppression has been observed in several of the offset wells, creating an incremental benefit, even if the oil rate did not increase. 3. Increased watercut in some of the wells has created hydrate problems resulting in deferred production and increased remediation costs. 4. Increased watercut in some of the wells coupled with the favorable reduction in gas rate has created the need for gas lift. 5. Changes in well performance, both favorable and negative around L5-29, have often been sudden and rapid, making long term predictions difficult. a. Current observed net incremental rate from L5-29 is estimated to be in the range of 100-350 bopd, compared to original expected benefits of 2,310 bopd. b. Incremental net recovery benefits currently are estimated in the range of 0.5 to 3 MMSTB, compared to original predictions of 1-12 MMSTB c. Unforeseen facility and well problems resulting in injector and producer downtime obfuscates some of the well trends and producer -injector interactions. d. L5-29 may have larger field -wide impacts that are more difficult to quantify due to a combination of cycle, full-time, and offline wells spread over multiple drillsites. Plan Forward for GCWI 1. Attempt repair of injector L5-29. 2. Request AOGCC permission for permanent injection into L5-29. 3. Continue monitoring wells in the area to maximize performance and recovery. 4. The Prudhoe Bay Unit working interest owners at this time do not plan to expand GCWI outside of L5-29, however, the owners periodically review future opportunities as new information is acquired through time and understanding of performance changes.