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O 122
OTHER ORDER 122 Nordaq Energy Docket Number: OTH-16-032 1. ------------------------- Background information 2. December 2, 2016 Notice of Enforcement Action Tiger Eye Central 1 3. December 3, 2016 DNR Letter re: Statewide Bond Release Request 4. January 14, 2017 Notice of public hearing, affidavit of publication, email distribution, bulk mailing list 5. January 20, 2017 Letter from DNR Re: Statewide Bond Release Request for $500,00 Certificate on Deposit with Wells Fargo 6. ------------------------- E-mails 7. April 4, 2017 Hearing Transcript, Sign in Sheet and Exhibits 8. May 24, 2017 Revised Notice of Enforcement Action Tiger Eye Central 1 9. June 8, 2017 Nordaq's Letter not concurring with the proposed enforcement action 10. June 12, 2017 AOGCC's letter scheduling informal review 11. June 22, 2017 Nordaq's submittal for the informal review 12. June 27, 2017 Sign in Sheet for Informal Review and documents submitted by Nordaq 13. August 4, 2017 Entry of Appearance Brena, Bell & Clarkson 14. August 4, 2017 NordAq Energy's Request for Extension of Time to File Application for Reconsideration and Affidavit in Support 15. August 10, 2017 AOGCC's response to Request for Extension of Time to File 16. August 14, 2017 NordAq Energy's Request for Oral Argument, Entry of Appearance, Application for Reconsideration and Exhibits 17. September 11, 2017 Hearing Notice to NordAq 18. September 13, 2017 NordAq Energy's Application for Reconsideration Re: Surety Bond 19. September 19, 2017 Notice of public hearing, affidavit of publication, email distribution, bulk mailing list 20. September 20, 2017 Hearing Transcript, Sign in Sheet and Exhibits Internal Documents held in Secure Storage ORDERS STATE OF ALASKA ALASKA OIL AND GAS CONSERVATION COMMISSION 333 West Seventh Avenue Anchorage, Alaska 99501 Re: Failure to Plug and Abandon Tiger Eye ) Other Order No. 122 Central -1 (Permit No. 212-102) Before ) Docket No. OTH-16-032 Termination of Owner's Rights in Oil and ) July 20, 2017 Gas Leases ADL 391104 and C-061677 ) Failure to Respond to Notice of Proposed ) Enforcement Action ) DECISION AND ORDER On December 2, 2016, the Alaska Oil and Gas Conservation Commission (AOGCC) issued a Notice of Proposed Enforcement Action (Notice) to NordAq Energy Inc. (NordAq) regarding Tiger Eye Central -1 exploratory well (Tiger Eye -1). The Notice was based upon NordAq's failure to permanently abandon Tiger Eye -1 before expiration of NordAq's rights in leases through which Tiger Eye -1 is drilled: State of Alaska lease ADL 391104 and Cook Inlet Region, Inc. (CIRI) lease C-061677. The termination of NordAq's rights in ADL 391104 was effective October 12, 2016. The CIRI lease was terminated effective July 1, 2015. (AOGCC did not learn of the termination of the CIRI lease until after issuance of the December 2, 2016, Notice.) The Notice proposed specific corrective actions and a $150,000 civil penalty under AS 31.05.150(a). The Notice also proposed that NordAq provide a check in the amount of $1,300,000, AOGCC's projected cost to plug and abandon Tiger Eye -1 if NordAq did not uphold its obligation to do so. NordAq failed to respond to the Notice. The AOGCC scheduled a public hearing for April 4, 2017, at 10:00 a.m. On January 14, 2017, the AOGCC published a public notice for that hearing in the ALASKA DISPATCH NEWS. After the AOGCC noticed the public hearing, NordAq contacted AOGCC with a proposed plan to plug and abandon the Tiger Eye -1. AOGCC approved that plan on March 7, 2017. The public hearing was held on April 4, 2017. NordAq appeared and presented evidence. Summary of Revised Proposed Enforcement Action After the hearing, on May 24, 2017, the AOGCC issued a Revised Notice of Proposed Enforcement Action (Revised Notice) regarding Tiger Eye -1. The Revised Notice changed the requirement of Other Order No. 122 July 20, 2017 Page 2 of 5 a check for $1,300,000 to a bond in that amount in the sole favor of the AOGCC and lowered the civil penalty to $100,000. The Revised Notice specified that the bond would be forfeited if Tiger Eye -1 had not been permanently plugged and abandoned and the well location cleared within one year of the date of the Revised Notice. The bond was to be due within 30 days of the Revised Notice. NordAq requested an informal review. That review was held at the AOGCC offices on June 27, 2017. Preliminary Findings On September 4, 2012, AOGCC issued Permit to Drill No. 212-102 for Tiger Eye -1. Tiger Eye -1 was drilled in 2012 and subsequently suspended. NordAq was the owner of CIRI lease C-061677 and State of Alaska lease ADL 391104. The surface location for Tiger Eye -1 lies on acreage owned by Salamatof Native Association Inc. A portion of the wellbore crosses CIRI lease C- 061677. The bottom -hole location lies within ADL 391104. Tiger Eye -1 is located on the west side of Cook Inlet Basin and is only accessible during summer months. On October 14, 2016, DNR advised AOGCC that the termination of the Tiger Eye Unit on October 12, 2016, was the effective date of the termination of NordAq's rights in ADL 391104. CIRI lease C-061677 was terminated effective July 1, 2015. NordAq does not dispute that the Tiger Eye -1 was not properly plugged and abandoned at the time of the expiration of NordAq's rights in those leases. NordAq has violated 20 AAC 25.105(a). Mitigating Circumstances Presented by the Operator At the public hearing on April 4, 2017 and the informal review on June 27, 2017, NordAq offered the following in mitigation of its noncompliance: NordAq's delay was due in part to its attempt to negotiate transfer of Tiger Eye -1 to Cook Inlet Energy (CIE) after termination of the CIRI lease; Other Order No. 122 July 20, 2017 Page 3 of 5 CIE informed NordAq around July 2016 that it was not interested in assuming responsibility for the Tiger Eye -1 well; Tiger Eye -1 is only accessible during summer months; NordAq's failure to respond to the initial Notice was due to a robbery that occurred at NordAq's offices; NordAq's effort to start work to plug and abandon Tiger Eye -1 in June 2017 has been delayed until August 1, 2017, due to Chevron's use of dock on west side of Cook Inlet; The delay in plugging and abandoning the well after termination of these oil and gas leases resulted in no hydrocarbon leakage, well integrity problems, or other problems other than a time delay; Tiger Eye -1 well site has road access from Cook Inlet dock area. As a result, the expense of reaching Tiger Eye -1 is less than contemplated by AOGCC's $1,300,000 bond; and Salamantof Native Corporation (surface estate owner) wants the existing road and pad left in place. Additional Findings NordAq failed to properly plug and abandon Tiger Eye -1 and clear the well site in accordance with AOGCC's regulatory requirements prior to termination of its rights in the leases upon which Tiger Eye -1 is sited. Following termination of leases C-061677 and ADL 391104, NordAq did not notify the AOGCC or discuss Tiger Eye -1 with the AOGCC. NordAq failed to respond to the initial Notice. Bonds on file with other State agencies cannot be appropriated by the AOGCC. Other Order No. 122 July 20, 2017 Page 4 of 5 Conclusions The surety bond must reflect all costs that will be incurred by the State in the event NordAq defaults on its regulatory obligations to plug and abandon Tiger Eye -1 and clear the well site. Because Tiger Eye -1 well site has road access, construction and use of an ice road for plugging and abandonment operations are not required, thus lowering the total cost estimate to bring Tiger Eye -1 into compliance, and in turn, the amount of the bond required. Now Therefore It Is Ordered That: After application of the criteria set forth in AS 31.05.150(g) to the matters set forth above, NordAq shall pay a civil penalty of $100,000 for violating 20 AAC 25.105(a) by failing to permanently abandon Tiger Eye -1 before expiration of its rights in State of Alaska oil and gas lease ADL 391104 and CIRI oil and gas lease C-061677. The total civil penalty is $100,000. In addition, within 30 days of receipt of this letter, NordAq shall submit a surety bond for $800,000 issued on Form 10-402A in the sole favor of the AOGCC by an authorized insurer under AS 21.09 whose certificate of authority is in good standing with the State of Alaska. This bond will be returned to NordAq following permanent abandonment of Tiger Eye -1 and clearance of well location. This bond shall be forfeited to the AOGCC if Tiger Eye -1 is not permanently plugged and abandoned and the well location cleared within one year of the date of this Decision and Order. As an Operator involved in an enforcement action, you are required to preserve documents concerning the above action until after resolution of the proceeding. Done at Anchorage, Alaska and dated July 20, 2017. Other Order No. 122 July 20, 2017 Page 5 of 5 Hollis S. French Chair, Commissioner &i�; Daniel T. Seamount, Jr. Commissioner 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. - &omestic mau tPrilty M , 7 N For delivery information, visit our website at www.usps.comll. u-) Ln ro Certified Mail Fee 3. Service Type ❑ Priority Mail Express® r -q $ Ln Extra Services R Fees (check box, add fee as appropriate) ❑ Return Receipt (hardcopy) $ rr1 ❑ Return Recelpt (electronic) $ Postmark O ❑ Certified Mail Restricted Delivery $ ❑ Registered Mail Here E3 ❑ Adult Signature Required $ III 0 ❑ Adult Signature Restricted Delivery $ I IIID 17-11 Postage I I II :1- $ ❑ Adult Signature Restricted Delivery _D Total Postage and Fees o $ Robert Warthen „r) Sent To Senior Advisor a- Street andApElVo.,iirPOBoxNo. NordAq Energy, Inc. 560 E. 34th St., Ste. 200 city, staie; 2iP+4®----------------------- f,Certified Mail® Delivery 9590 9402 1823 6104 6488 49 Anchorage, AK 99503 ■ Complete items 1, 2, and 3. ■ Print your name and address on the reverse so that we can return the card to you. ■ Attach this card to the back of the mailpiece, or on the front if space permits. 1 Ar 1-1- All ----- RECEI A.:+ cure y , �A n 13 Agent X`'�` 44"X aft, ❑ Addressee B. Received 'Au, M l %Varve) I C. Date.ot Delivery W,r''`u, Cki `�S. D. Is delivery address differAi fro nm item 1? 0 Yes S,,enter delivery address below: 0 No Robert Warthen E o Senior Advisor JUL 2 4 2 , 7 NordAq Energy, Inc. 99 560 E. 34th St., Ste. 200 /� OGG Anchorage, AK 99503 � 3. Service Type ❑ Priority Mail Express® ❑ Adult Signature ❑ Registered Mail ll I III II III I I I II I IIID ( I ( I I II II II I'll ❑ Adult Signature Restricted Delivery ❑ Registered Mail R Restricted f,Certified Mail® Delivery 9590 9402 1823 6104 6488 49 ❑ Certified Mail Restricted Delivery OR Return Receipt for Merchandise ❑ Collect on Delivery ❑ Collect on Delivery Restricted Delivery ❑ Signature ConfirmationT ❑ Signature Confirmation 2. Article Number (Transfer from service label) 7 015 0640 0003 5185 5734 fail rail Restricted Delivery Restricted Delivery PS Form 3811, July 2015 PSN 7530-02-000-9053 Domestic Return Receipt Ito t7-3 0 U1 r_1 O N xtra Services & Fees (check box, add fee as appropriate) A. signature ILI E3 Agent : ❑ Return Receipt (hardcopy) $ �■ )11VI CJ [3 Addressee'' ❑ Return Receipt (electronic) $ Postmark ❑ Certified Mail Restricted Delivery $ Here ❑ Adult Signature Required $ is delivery address different from item 17` ❑ Yes ❑ Adult Signature Restricted Delivery $ V10fter delivery address below: p No A now $ David Pfeiffer Sent To Chief Financial Officer Str . q Energy, ---------- NordA Ener Inc. eet and Apt. No., or PO Box No -----state; zfP+4®------------------------ 560 E. 34th St., Ste. 200 Anchorage, AK 99503 ■ Complete items 1, 2, and 3. A. signature ILI E3 Agent : Print your name and address on the reverse �■ )11VI CJ [3 Addressee'' so that we can return the card to you. ■ Attach this card to the back of the mailpiece, B. Received by (Printed Namq) C. Date of Deliverp 13 �4 F�� N or on the front if space permits. AwW^ AA- 4 •^• _ is delivery address different from item 17` ❑ Yes V10fter delivery address below: p No A now David Pfeiffer 411111111, Chief Financial Officer .JUL 2 4 2017 NordAci Energy, Inc. 560 E. 34th St., Ste. 200 q fi*t OqVL� Anchorage, AK 99503 3. Service Type ❑ Priority Mail Express® II I' IIII IIII II I II I IIII III ( III I II I II I I O Adult Signature - ❑ Registered Mail ❑ Adult Signature Restricted DeliveryElR Registered Mall Restricted e-Ctified Mail® Delivery 9590 9402 1823 6104 6488 25 ❑Certified Mail Restricted Delivery q7-Retum Receipt for ❑ Collect on Delivery Merchandise 2. Article Number (transfer f om service label) El Collect on Delivery Restricted Delivery 0 Signature Confirmation - 2. ❑ Signature Confirmation 7 015 0640 0003 5185 5741 la I Restricted Delivery Restricted Delivery PS Form 3811, July 2015 PSN 7530-02-000-9053 Domestic Return Receipt STATE OF ALASKA ALASKA OIL AND GAS CONSERVATION COMMISSION 333 West Seventh Avenue Anchorage, Alaska 99501 Re: Failure to Plug and Abandon Tiger Eye ) Other Order No. 122 Central -1 (Permit No. 212-102) Before ) Docket No. OTH-16-032 Termination of Owner's Rights in Oil and ) July 20, 2017 Gas Leases ADL 391104 and C-061677 ) Failure to Respond to Notice of Proposed ) Enforcement Action ) DECISION AND ORDER On December 2, 2016, the Alaska Oil and Gas Conservation Commission (AOGCC) issued a Notice of Proposed Enforcement Action (Notice) to NordAq Energy Inc. (NordAq) regarding Tiger Eye Central -1 exploratory well (Tiger Eye -1). The Notice was based upon NordAq's failure to permanently abandon Tiger Eye -1 before expiration of NordAq's rights in leases through which Tiger Eye -1 is drilled: State of Alaska lease ADL 391104 and Cook Inlet Region, Inc. (CIRI) lease C-061677. The termination of NordAq's rights in ADL 391104 was effective October 12, 2016. The CIRI lease was terminated effective July 1, 2015. (AOGCC did not learn of the termination of the CIRI lease until after issuance of the December 2, 2016, Notice.) The Notice proposed specific corrective actions and a $150,000 civil penalty under AS 31.05.150(a). The Notice also proposed that NordAq provide a check in the amount of $1,300,000, AOGCC's projected cost to plug and abandon Tiger Eye -1 if NordAq did not uphold its obligation to do so. NordAq failed to respond to the Notice. The AOGCC scheduled a public hearing for April 4, 2017, at 10:00 a.m. On January 14, 2017, the AOGCC published a public notice for that hearing in the ALASKA DISPATCH NEWS. After the AOGCC noticed the public hearing, NordAq contacted AOGCC with a proposed plan to plug and abandon the Tiger Eye -1. AOGCC approved that plan on March 7, 2017. The public hearing was held on April 4, 2017. NordAq appeared and presented evidence. Summary of Revised Proposed Enforcement Action After the hearing, on May 24, 2017, the AOGCC issued a Revised Notice of Proposed Enforcement Action (Revised Notice) regarding Tiger Eye -1. The Revised Notice changed the requirement of Other Order No. 122 July 20, 2017 Page 2 of 5 a check for $1,300,000 to a bond in that amount in the sole favor of the AOGCC and lowered the civil penalty to $100,000. The Revised Notice specified that the bond would be forfeited if Tiger Eye -1 had not been permanently plugged and abandoned and the well location cleared within one year of the date of the Revised Notice. The bond was to be due within 30 days of the Revised Notice. NordAq requested an informal review. That review was held at the AOGCC offices on June 27, 2017. Preliminary Findine-s On September 4, 2012, AOGCC issued Permit to Drill No. 212-102 for Tiger Eye -1. Tiger Eye -1 was drilled in 2012 and subsequently suspended. NordAq was the owner of CIRI lease C-061677 and State of Alaska lease ADL 391104. The surface location for Tiger Eye -1 lies on acreage owned by Salamatof Native Association Inc. A portion of the wellbore crosses CIRI lease C- 061677. The bottom -hole location lies within ADL 391104. Tiger Eye -1 is located on the west side of Cook Inlet Basin and is only accessible during summer months. On October 14, 2016, DNR advised AOGCC that the termination of the Tiger Eye Unit on October 12, 2016, was the effective date of the termination of NordAq's rights in ADL 391104. CIRI lease C-061677 was terminated effective July 1, 2015. NordAq does not dispute that the Tiger Eye -1 was not properly plugged and abandoned at the time of the expiration of NordAq's rights in those leases. NordAq has violated 20 AAC 25.105(a). MitigatinIz Circumstances Presented by the Operator At the public hearing on April 4, 2017 and the informal review on June 27, 2017, NordAq offered the following in mitigation of its noncompliance: NordAq's delay was due in part to its attempt to negotiate transfer of Tiger Eye -1 to Cook Inlet Energy (CIE) after termination of the CIRI lease; Other Order No. 122 July 20, 2017 Page 3 of 5 CIE informed NordAq around July 2016 that it was not interested in assuming responsibility for the Tiger Eye -1 well; Tiger Eye -1 is only accessible during summer months; NordAq's failure to respond to the initial Notice was due to a robbery that occurred at NordAq's offices; NordAq's effort to start work to plug and abandon Tiger Eye -1 in June 2017 has been delayed until August 1, 2017, due to Chevron's use of dock on west side of Cook Inlet; The delay in plugging and abandoning the well after termination of these oil and gas leases resulted in no hydrocarbon leakage, well integrity problems, or other problems other than a time delay; Tiger Eye -1 well site has road access from Cook Inlet dock area. As a result, the expense of reaching Tiger Eye -1 is less than contemplated by AOGCC's $1,300,000 bond; and Salamantof Native Corporation (surface estate owner) wants the existing road and pad left in place. Additional Findings NordAq failed to properly plug and abandon Tiger Eye -1 and clear the well site in accordance with AOGCC's regulatory requirements prior to termination of its rights in the leases upon which Tiger Eye -1 is sited. Following termination of leases C-061677 and ADL 391104, NordAq did not notify the AOGCC or discuss Tiger Eye -1 with the AOGCC. NordAq failed to respond to the initial Notice. Bonds on file with other State agencies cannot be appropriated by the AOGCC. Other Order No. 122 July 20, 2017 Page 4 of 5 Conclusions The surety bond must reflect all costs that will be incurred by the State in the event NordAq defaults on its regulatory obligations to plug and abandon Tiger Eye -1 and clear the well site. Because Tiger Eye -1 well site has road access, construction and use of an ice road for plugging and abandonment operations are not required, thus lowering the total cost estimate to bring Tiger Eye -1 into compliance, and in turn, the amount of the bond required. Now Therefore It Is Ordered That: After application of the criteria set forth in AS 31.05.150(g) to the matters set forth above, NordAq shall pay a civil penalty of $100,000 for violating 20 AAC 25.105(a) by failing to permanently abandon Tiger Eye -1 before expiration of its rights in State of Alaska oil and gas lease ADL 391104 and CIRI oil and gas lease C-061677. The total civil penalty is $100,000. In addition, within 30 days of receipt of this letter, NordAq shall submit a surety bond for $800,000 issued on Form 10-402A in the sole favor of the AOGCC by an authorized insurer under AS 21.09 whose certificate of authority is in good standing with the State of Alaska. This bond will be returned to NordAq following permanent abandonment of Tiger Eye -land clearance of well location. This bond shall be forfeited to the AOGCC if Tiger Eye -1 is not permanently plugged and abandoned and the well location cleared within one year of the date of this Decision and Order. As an Operator involved in an enforcement action, you are required to preserve documents concerning the above action until after resolution of the proceeding. Done at Anchorage, Alaska and dated July 20, 2017. Other Order No. 122 July 20, 2017 Page 5 of 5 Hsignature on fileH Hollis S. French Chair, Commissioner Hsignature on fileH Daniel T. Seamount, Jr. Commissioner RECONSIDERATION AND APPEAL NOTICE Hsignature on fileH Cathy P. Foerster Commissioner 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. Bernie Karl K&K Recycling Inc. Gordon Severson Penny Vadla P.O. Box 58055 3201 Westmar Cir. 399 W. Riverview Ave. Fairbanks, AK 99711-0055 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 99639-0309 Fairbanks, AK 99706-0868 `ll(js 7 - Zo - 2-" k -r, EN Colombie, Jody J (DOA) From: Colombie, Jody J (DOA) Sent: Thursday, July 20, 2017 10:12 AM To: DOA AOGCC Prudhoe Bay; Bender, Makana K (DOA); Bettis, Patricia K (DOA); Brooks, Phoebe L (DOA); Carlisle, Samantha J (DOA); Colombie, Jody J (DOA); Davies, Stephen F (DOA); Eaton, Loraine E (DOA); Foerster, Catherine P (DOA); French, Hollis (DOA); Frystacky, Michal (DOA); Guhl, Meredith D (DOA); Kair, Michael N (DOA); Link, Liz M (DOA); Loepp, Victoria T (DOA); Mumm, Joseph (DOA sponsored); Paladijczuk, Tracie L (DOA); Pasqual, Maria (DOA); Quick, Michael J (DOA); Regg, James B (DOA); Roby, David S (DOA); Schwartz, Guy L (DOA); Seamount, Dan T (DOA); Singh, Angela K (DOA); Wallace, Chris D (DOA); AK, GWO Projects Well Integrity; AKDCWellIntegrityCoordinator; Alan Bailey; Alex Demarban; Alexander Bridge; Alicia Showalter, Allen Huckabay; Andrew Vandedack; Ann Danielson; Anna Raff; Barbara F Fullmer; bbritch; bbohrer@ap.org; Ben Boettger; Bill Bredar; Bob Shavelson; Brandon Viator; Brian Havelock; Bruce Webb; Caleb Conrad; Candi English; Cocklan-Vendl, Mary E; Colleen Miller; Connie Downing; Crandall, Krissell; D Lawrence; Dale Hoffman; Darci Horner; Dave Harbour; David Boelens; David Duffy; David House; David McCaleb; David McCraine; ddonkel@cfl.rr.com; DNROG Units (DNR sponsored); Donna Ambruz; Ed Jones; Elizabeth Harball; Elowe, Kristin; Elwood Brehmer; Evan Osborne; Evans, John R (LDZX); Brown, Garrett A (DNR); George Pollock; Gordon Pospisil; Greeley, Destin M (DOR); Gretchen Stoddard; gspfoff, Hunter Cox; Hurst, Rona D (DNR); Hyun, James J (DNR); Jacki Rose; Jason Brune; Jdarlington Oarlington@gmail.com); Jeanne McPherren; Jerry Hodgden; Jill Simek; Jim Watt; Jim White; Joe Lastufka; Radio Kenai; Burdick, John D (DNR); Easton, John R (DNR); Larsen, John M (DOR); John Stuart; Jon Goltz; Chmielowski, Josef (DNR); Juanita Lovett; Judy Stanek; Kari Moriarty; Kasper Kowalewski; Kazeem Adegbola; Keith Torrance; Keith Wiles; Kelly Sperback; Frank, Kevin J (DNR); Kruse, Rebecca D (DNR); Kyla Choquette; Gregersen, Laura S (DNR); Leslie Smith; Lori Nelson; Louisiana Cutler, Luke Keller; Marc Kovak; Dalton, Mark (DOT sponsored); Mark Hanley (mark.hanley@anadarko.com); Mark Landt; Mark Wedman; Mealear Tauch; Michael Bill; Michael Calkins; Michael Moora; Mike Morgan; MJ Loveland; mkm7200; Motteram, Luke A; Mueller, Marta R (DNR); knelson@petroleumnews.com; Nichole Saunders; Nick Ostrovsky; Nikki Martin; NSK Problem Well Supv; Patty Alfaro; Paul Craig; Decker, Paul L (DNR); Paul Mazzolini; Pike, Kevin W (DNR); Randall Kanady; Renan Yanish; Richard Cool; Robert Brelsford; Sara Leverette; Scott Griffith; Shahla Farzan; Shannon Donnelly; Sharon Yarawsky; Skutca, Joseph E (DNR); Smart Energy Universe; Smith, Kyle S (DNR); Stephanie Klemmer; Stephen Hennigan; Sternicki, Oliver R; Moothart, Steve R (DNR); Steve Quinn; Suzanne Gibson; sheffield@aoga.org; Ted Kramer; Teresa Imm; Tim Jones; Tim Mayers; Todd Durkee; Tom Maloney; 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; Andy Bond; Bajsarowicz, Caroline J; Bruce Williams; Bruno, Jeff J (DNR); Casey Sullivan; Corey Munk; Don Shaw; Eppie Hogan ; Eric Lidji; Garrett Haag; Smith, Graham O (DNR); Heusser, Heather A (DNR); Fair, Holly S (DNR); Jamie M. Long; Jason Bergerson; Jesse Chielowski; Jim Magill; Shine, Jim M (DNR); Joe Longo; John Martineck; Josh Kindred; Keith Lopez; Laney Vazquez; Lois Epstein; Longan, Sara W (DNR); Marc Kuck; Marcia Hobson; Steele, Marie C (DNR); Matt Armstrong; Melonnie Amundson; Franger, James M (DNR); Morgan, Kirk A (DNR); Umekwe, Maduabuchi P (DNR); Pat Galvin; Pete Dickinson; Peter Contreras; Rachel Davis; Richard Garrard; Richmond, Diane M; Robert Province; Ryan Daniel; Sandra Lemke; Pollard, Susan R (LAW); Talib Syed; Tina Grovier (tmgrovier@stoel.com); William Van Dyke Subject: Other Order 122 Attachments: Other 122.pdf Please see attached. Re: Failure to Plug and Abandon Tiger Eye ) Other Order No. 122 Central -1 (Permit No. 212-102) Before ) Docket No. OTH-16-032 Termination of Owner's Rights in Oil and ) July 20, 2017 Gas Leases ADL 391104 and C-061677 ) Failure to Respond to Notice of Proposed ) Enforcement Action ) Jody J. Colombie AOGCC SpeciaCAssistant ACaska Oil and Gas Conservation Commission 333 'Nest 7t' Avenue Anchorage, Alaska gg5oi Office: (907) 793-1221 fax: (907) 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 jodv.colombie@alaska.gov. STATE OF ALASKA ALASKA OIL AND GAS CONSERVATION COMMISSION 333 West Seventh Avenue Anchorage, Alaska 99501 Re: Failure to Plug and Abandon Tiger Eye ) Other Order No. 122 Final Central -1 (Permit No. 212-102) Before ) Docket No. OTH-16-032 Termination of Owner's Rights in Oil and ) June 29, 2018 Gas Leases ADL 391104 and C-061677 ) Failure to Respond to Notice of Proposed ) Enforcement Action ) DECISION AND ORDER ON RECONSIDERATION The Violation On September 4, 2012, the Alaska Oil and Gas Conservation Commission (AOGCC) issued Permit to Drill No. 212-102 for the Tiger Eye -1 exploratory well (Tiger Eye 1). Tiger Eye -1 was drilled in 2012 and subsequently suspended. Tiger Eye -1 is located on the west side of Cook Inlet Basin and is only accessible during summer months. The surface location for Tiger Eye -1 lies on acreage owned by Salamatof Native Association, Inc. A portion of the wellbore crosses Cook Inlet Region, Inc. (CIRI) lease C-061677 (CIRI lease). The bottom -hole location lies within State of Alaska Department of Natural Resources (DNR) lease ADL 391104 (DNR lease). NordAq Energy, Inc. (NordAq) was the owner of the CIRI lease and the DNR lease. In October 2016, DNR advised AOGCC that the termination of the Tiger Eye Unit on October 12, 2016 was the effective date of the termination of NordAq's rights in the DNR lease. ADL 391104. At the time of termination of both leases, Tiger Eye 1 had not been properly plugged and abandoned. As a result of DNR's notification, on December 2, 2016, the AOGCC issued a Notice of Proposed Enforcement Action (Notice) to NordAq based upon NordAq's failure to permanently abandon Tiger Eye -1 before expiration of NordAq's rights in the DNR lease. After it issued the Notice, AOGCC learned the CIRI lease had been terminated effective July 1, 2015. The Notice proposed specific corrective actions, a$150,000 civil penalty and that NordAq provide a check in the amount of $1,300,000, AOGCC's projected cost to plug and abandon Tiger Eye -1 if NordAq defaulted on its obligation to do so. When NordAq failed to respond to the Notice, AOGCC scheduled a public hearing for April 4, 2017, at 10:00 a.m. On January 14, 2017, the AOGCC published a public notice for that hearing in the ALASKA DISPATCH NEWS. In response to AOGCC's notice of the public hearing, NordAq contacted AOGCC with a proposed plan to plug and abandon Tiger Eye -1. AOGCC approved that plan on March 7, 2017. Other Order No. 122 Final June 29, 2018 Page 2 of 3 The public hearing was held on April 4, 2017. NordAq appeared and did not dispute that it had not complied with the regulation, but presented evidence it felt mitigated the violation On May 24, 2017, the AOGCC issued a Revised Notice of Proposed Enforcement Action (Revised Notice), lowering the proposed penalty to $100,000 and changing the requirement of a check for $1,300,000 to a bond in that amount in the sole favor of the AOGCC. The Revised Notice specified that the bond would be forfeited if Tiger Eye -1 had not been permanently plugged and abandoned and the well location had not been cleared within one year of the date of the Revised Notice. The bond was due within 30 days of the Revised Notice. NordAq requested an informal review. That review was held at the AOGCC offices on June 27, 2017. Other Order No. 122 After informal review, on July 20, 2017 Other Order No. 122 (Order) was issued. Based on the evidence presented, the Order imposed a civil penalty in the amount of $100,000, reduced the required bond amount to $800,000 and required NordAq to submit proof of the bond within 30 days. The bond was deemed forfeited if NordAq did not plug and abandon Tiger Eye 1 within a year. Subsequent Proceedings On August 4, 2017, NordAq requested an extension of time to file an application to reconsider the portion of the Order that required a surety bond in the amount of $800,000. AOGCC granted the request. The revised due date was September 13, 2017. On August 14, 2017, NordAq requested reconsideration and oral argument of the Order's bond requirement. Oral argument was held on September 20, 2017. At oral argument, NordAq advised that Tiger Eye -1 had been plugged and abandoned on September 9, 2017. NordAq argued that the $800,000 surety bond had become moot and requested to be relieved of the bonding requirement. NordAq also argued that a $10,000 civil penalty was more reasonable given that the failure to plug and abandon Tiger Eye -1 had not harmed the public and had not resulted in any increased risk to health, safety, or the environment. Findings Because NordAq admits it violated 20 AAC 25.105(a), AOGCC finds NordAq failed to properly plug and abandon Tiger Eye -1 and clear the well site prior to termination of its rights in the leases upon which Tiger Eye -1 is sited. Tiger Eye -1 was plugged and abandoned on September 9, 2017. Other Order No. 122 Final June 29, 2018 Page 3 of 3 Now Therefore It Is Ordered That: After application of the criteria set forth in AS 31.05.150(g) to the matters set forth above, within 30 days of the date of this Final Decision and Order, NordAq shall pay a civil penalty of $25,000 for violating 20 AAC 25.105(a). Requirement for a $800,000 -dollar bond is rescinded. As an Operator involved in an enforcement action, NordAq is required to preserve documents concerning the above action until after resolution of the proceeding. Done at Anchorage, Alaska and dated June 29, 2018. Hollis S. French Daniel T. Seamount, Jr. Cathy P. Chair, Commissioner Commissioner Commiss 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. STATE OF ALASKA ALASKA OIL AND GAS CONSERVATION COMMISSION 333 West Seventh Avenue Anchorage, Alaska 99501 Re: Failure to Plug and Abandon Tiger Eye ) Other Order No. 122 Final Central -1 (Permit No. 212-102) Before ) Docket No. OTH-16-032 Termination of Owner's Rights in Oil and ) June 29, 2018 Gas Leases ADL 391104 and C-061677 ) Failure to Respond to Notice of Proposed ) Enforcement Action ) DECISION AND ORDER ON RECONSIDERATION The Violation On September 4, 2012, the Alaska Oil and Gas Conservation Commission (AOGCC) issued Permit to Drill No. 212-102 for the Tiger Eye -1 exploratory well (Tiger Eye 1). Tiger Eye -1 was drilled in 2012 and subsequently suspended. Tiger Eye -1 is located on the west side of Cook Inlet Basin and is only accessible during summer months. The surface location for Tiger Eye -1 lies on acreage owned by Salamatof Native Association, Inc. A portion of the wellbore crosses Cook Inlet Region, Inc. (CIRI) lease C-061677 (CIRI lease). The bottom -hole location lies within State of Alaska Department of Natural Resources (DNR) lease ADL 391104 (DNR lease). NordAq Energy, Inc. (NordAq) was the owner of the CIRI lease and the DNR lease. In October 2016, DNR advised AOGCC that the termination of the Tiger Eye Unit on October 12, 2016 was the effective date of the termination of NordAq's rights in the DNR lease. ADL 391104. At the time of termination of both leases, Tiger Eye 1 had not been properly plugged and abandoned. As a result of DNR's notification, on December 2, 2016, the AOGCC issued a Notice of Proposed Enforcement Action (Notice) to NordAq based upon NordAq's failure to permanently abandon Tiger Eye -1 before expiration of NordAq's rights in the DNR lease. After it issued the Notice, AOGCC learned the CIRI lease had been terminated effective July 1, 2015. The Notice proposed specific corrective actions, a $150,000 civil penalty and that NordAq provide a check in the amount of $1,300,000, AOGCC's projected cost to plug and abandon Tiger Eye -1 if NordAq defaulted on its obligation to do so. When NordAq failed to respond to the Notice, AOGCC scheduled a public hearing for April 4, 2017, at 10:00 a.m. On January 14, 2017, the AOGCC published a public notice for that hearing in the ALASKA DISPATCH NEWS. In response to AOGCC's notice of the public hearing, NordAq contacted AOGCC with a proposed plan to plug and abandon Tiger Eye -1. AOGCC approved that plan on March 7, 2017. Other Order No. 122 Final June 29, 2018 Page 2 of 3 The public hearing was held on April 4, 2017. NordAq appeared and did not dispute that it had not complied with the regulation, but presented evidence it felt mitigated the violation On May 24, 2017, the AOGCC issued a Revised Notice of Proposed Enforcement Action (Revised Notice), lowering the proposed penalty to $100,000 and changing the requirement of a check for $1,300,000 to a bond in that amount in the sole favor of the AOGCC. The Revised Notice specified that the bond would be forfeited if Tiger Eye -1 had not been permanently plugged and abandoned and the well location had not been cleared within one year of the date of the Revised Notice. The bond was due within 30 days of the Revised Notice. NordAq requested an informal review. That review was held at the AOGCC offices on June 27, 2017. Other Order No. 122 After informal review, on July 20, 2017 Other Order No. 122 (Order) was issued. Based on the evidence presented, the Order imposed a civil penalty in the amount of $100,000, reduced the required bond amount to $800,000 and required NordAq to submit proof of the bond within 30 days. The bond was deemed forfeited if NordAq did not plug and abandon Tiger Eye 1 within a year. Subsequent Proceedines On August 4, 2017, NordAq requested an extension of time to file an application to reconsider the portion of the Order that required a surety bond in the amount of $800,000. AOGCC granted the request. The revised due date was September 13, 2017. On August 14, 2017, NordAq requested reconsideration and oral argument of the Order's bond requirement. Oral argument was held on September 20, 2017. At oral argument, NordAq advised that Tiger Eye -1 had been plugged and abandoned on September 9, 2017. NordAq argued that the $800,000 surety bond had become moot and requested to be relieved of the bonding requirement. NordAq also argued that a $10,000 civil penalty was more reasonable given that the failure to plug and abandon Tiger Eye -1 had not harmed the public and had not resulted in any increased risk to health, safety, or the environment. Findinas Because NordAq admits it violated 20 AAC 25.105(a), AOGCC finds NordAq failed to properly plug and abandon Tiger Eye -1 and clear the well site prior to termination of its rights in the leases upon which Tiger Eye -1 is sited. Tiger Eye -1 was plugged and abandoned on September 9, 2017. Other Order No. 122 Final June 29, 2018 Page 3 of 3 Now Therefore It Is Ordered That: After application of the criteria set forth in AS 31.05.150(g) to the matters set forth above, within 30 days of the date of this Final Decision and Order, NordAq shall pay a civil penalty of $25,000 for violating 20 AAC 25.105(a). Requirement for a $800,000 -dollar bond is rescinded. As an Operator involved in an enforcement action, NordAq is required to preserve documents concerning the above action until after resolution of the proceeding. Done at Anchorage, Alaska and dated June 29, 2018. //signature on file// //signature on file// //signature on file// Hollis S. French Daniel T. Seamount, Jr. Cathy P. Foerster Chair, Commissioner Commissioner Commissioner 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 I0 -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 Colombie, Jody J (DOA) From: Colombie, Jody J (DOA) Sent: Friday, June 29, 2018 10:49 AM To: rwarthen@nordaqenergy.com; Bell, Abby E (DOA); Bixby, Brian D (DOA); Brooks, Phoebe L (DOA); Carlisle, Samantha J (DOA); Colombie, Jody 1 (DOA); Cook, Guy D (DOA); Davies, Stephen F (DOA); Earl, Adam G (DOA); Erickson, Tamara K (DOA); Foerster, Catherine P (DOA); French, Hollis (DOA); Frystacky, Michal (DOA); Guhl, Meredith D (DOA); Herrera, Matthew F (DOA); Jones, Jeffery B (DOA); Kair, Michael N (DOA); Laubenstein, Lou (DOA); Loepp, Victoria T (DOA); Martin, Teddy 1 (DOA); McLeod, Austin (DOA); Mcphee, Megan S (DOA); Mumm, Joseph (DOA sponsored); Noble, Robert C (DOA); Paladijczuk, Tracie L (DOA); Pasqual, Maria (DOA); Regg, James B (DOA); Rixse, Melvin G (DOA); Roby, David S (DOA); Schwartz, Guy L (DOA); Seamount, Dan T (DOA); Wallace, Chris D (DOA); AK, GWO Projects Well Integrity; AKDCWellIntegrityCoordinator; Alan Bailey; Alex Demarban; Alicia Showalter; Allen Huckabay; Andrew VanderJack; Ann Danielson; Anna Lewallen; Anna Raff; Barbara F Fullmer; bbritch; bbohrer@ap.org; Ben Boettger; Bill Bredar; Bob Shavelson; Bonnie Bailey; Brandon Viator; Brian Havelock, Bruce Webb; Caleb Conrad; Candi English; Cody Gauer; Cody Terrell; Colleen Miller; Connie Downing; Crandall, Krissell; D Lawrence; Dale Hoffman; Danielle Mercurio; Darci Horner; Dave Harbour; David Boelens; David Duffy, David House; David McCaleb; David Pascal; ddonkel@cfl.rr.com; Diemer, Kenneth 1 (DNR); DNROG Units (DNR sponsored); Donna Ambruz; Ed Jones; Elizabeth Harball; Elowe, Kristin; Elwood Brehmer; Evan Osborne; Evans, John R (LDZX); Brown, Garrett A (DNR); George Pollock, Gordon Pospisil; Greeley, Destin M (DOR); Greg Kvokov, Gretchen Stoddard; gspfoff; Hurst, Rona D (DNR); Hyun, James J (DNR); Jacki Rose; Jason Brune; Jdarlington Oarlington@gmail.com); Jeanne McPherren; Jerry Hodgden; Jill Simek; Jim Shine; Jim Watt; Jim White (im4thgn@gmail.com); Young, Jim P (DNR); Joe Lastufka; Radio Kenai; Burdick, John D (DNR); Easton, John R (DNR); Larsen, John M (DOR); Jon Goltz; Joshua Stephen; Juanita Lovett; Judy Stanek; Kari Moriarty; Kasper Kowalewski; Kazeem Adegbola; Keith Torrance; Keith Wiles; Kelly Sperback; Frank, Kevin J (DNR); Kruse, Rebecca D (DNR); Kyla Choquette; Gregersen, Laura S (DNR); Leslie Smith; Lori Nelson; Luke Keller, Marc Kovak; Dalton, Mark (DOT sponsored); Mark Hanley (mark.hanley@anadarko.com); Mark Landt; Mark Wedman; Michael Bill; Michael Calkins; Michael Moora; Michael Quick; Michael Schoetz; Mike Morgan; MJ Loveland; Motteram, Luke A; Mueller, Marta R (DNR); Nathaniel Herz; knelson@petroleumnews.com; Nichole Saunders; Nick Ostrovsky; NSK Problem Well Supv; Patty Alfaro; Paul Craig; Decker, Paul L (DNR); Paul Mazzolini; Pike, Kevin W (DNR); Randall Kanady; Renan Yanish; Richard Cool; Robert Brelsford; Robert Tirpack; Ryan Gross; Sara Leverette; Scott Griffith; Shahla Farzan; Shannon Donnelly; Sharon Yarawsky; Skutca, Joseph E (DNR); Smith, Kyle S (DNR); Spuhler, Jes J (DNR); Stephanie Klemmer; Stephen Hennigan; Stephen Ratcliff; Sternicki, Oliver R, Moothart, Steve R (DNR); Steve Quinn; Suzanne Gibson; sheffield@aoga.org; Tanisha Gleason; Ted Kramer, Teresa Imm; Terry Caetano; Tim Mayers; Todd Durkee; Tom Maloney; Tyler Senden; Umekwe, Maduabuchi P (DNR); Vern Johnson; Vinnie Catalano; Well Integrity; Well Integrity; Weston Nash; Whitney Pettus; Aaron Gluzman; Aaron Sorrell; Ajibola Adeyeye; Alan Dennis; Andy Bond; Bajsarowicz, Caroline J; Bruce Williams; Casey Sullivan; Corey Munk; Don Shaw, Eppie Hogan; Eric Lidji; Garrett Haag; Smith, Graham O (DNR); Heusser, Heather A (DNR); Fair, Holly S (DNR); Jamie M. Long; Jason Bergerson; Jesse Chielowski; Jim Magill; Joe Longo; John Martineck; Josh Kindred; Keith Lopez; Laney Vazquez,, Lois Epstein; Longan, Sara W (DNR); Marc Kuck; Marcia Hobson; Matt Armstrong; Melonnie Amundson; Franger, James M (DNR); Morgan, Kirk A (DNR); Umekwe, Maduabuchi P (DNR); Pat Galvin; Pete Dickinson; Peter Contreras; Rachel Davis; Richard Garrard; Richmond, Diane M; Robert Province; Ryan Daniel; Sandra Lemke; Scott Pins; Pollard, Susan R (LAW); Talib Syed; Tina Grovier (tmgrovier@stoel.com); William Van Dyke; Zachary Shulman Subject: Other Order 122 and Other Order 123 Final (NordAq) Attachments: Other123 Final.pdf; Other122 Final .pdf Please see attached. Re: Failure to Plug and Abandon Tiger Eye ) Other Order No. 122 Final Central -1 (Permit No. 212-102) Before ) Docket No. OTH-16-032 Termination of Owner's Rights in Oil and ) June 29, 2018 Gas Leases ADL 391104 and C-061677 ) Failure to Respond to Notice of Proposed ) Enforcement Action ) Re: Failure to Plug and Abandon Shadura-1 ) (Permit No. 211-014) Before Expiration of ) Owner's Rights in CIRI Lease C-061648 ) Failure to Respond to Notice of Proposed ) Enforcement Action ) Jody J. Colombie AOGCC Syecial Assistan t Alaska OifandGas Conservation Commission 333 -Vest 7" Avenue Anchorage, Alaska 99501 Office: (907) 793-1221 Fax: (907) 276-7542 Other Order No. 123 Final Docket No. OTH-16-031 June 29, 2018 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 M 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 0 0001417 11-24 OHlce AU n 12106) Remltler: NORDAO ENERGY INC. Operator LD. u623790 u623790 CASHIER'S CHECK PAY TO THE ORDER OF ***STATE OF ALASKA*** ***Fifty thousand dollars and no cents*** Payee Address'. Memo'. OT Hb1� 6-031 8 TH-1 -032 ock ey t WELLS FARGO BANK, N.A. S 301 W NORTHERN LIGHTS BLVD ANCHORAGE, AK 99503 FOR INQUIRIES CALL (480) 394-3122 001L, 1707 247,11 1: 1 2 1000 2481:4861 5113E 0141707247 June 29, 2018 **$50,000.00** DI R. AUTHORIZED SIGNATURE ECEIVID JUN 292018 A®GCC INDEXES P AOGCC 9/202017 ITMO: PROPOSED ENFORCEMENTACTIONAGAINSTNmeOAq ENERGY Docket No. OM 1"31/032 ALASKA OIL AND GAS CONSERVATION COMMISSION Before Commissioners: Hollis French, Chair Cathy Foerster Daniel T. Seamount In the Matter of the Proposed Enforcement Action Against NordAq Energy, Inc. for Failure to Permanently Abandon the Shadura 1 Before Expiration of Rights in CIRI Oil and Gas Lease C-061648 and 20 AAC 25.105(a) and Failure to Respond to Notice of Proposed Enforcement and for Failure to Permanently Abandon the Tiger Eye Central 1 Before Expiration of Rights Under State of Alaska Oil and Gas Lease ADL 391104 and 20 AAC 25.105(a) and Failure to Respond to Notice of Proposed Enforcement. Docket No.: OTH 16-031 OTH 16-032 ALASKA OIL and GAS CONSERVATION COMMISSION Anchorage, Alaska September 20, 2017 10:00 o'clock a.m. PUBLIC HEARING BEFORE: Hollis French Daniel T. Seamount Cathy Foerster Compute Mattii. LLC Phone: 907-243-0668 135 Christensen Dr., Ste, 2., Anch. AK 99501 Fax: 907-243-1473 Email: sande@w ci.md AOGCC 912O/2017 IWO: PROPOSED ENFORCEMENTACTION AGAMSTNordAq ENERGY Dockd No. OT 16-031/032 Page 2 1 TABLE OF CONTENTS 2 Opening remarks by Chair French 03 3 Oral argument by Mr. Brena 05 4 Testimony by Mr. Warthen 26 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Computer Matrix, I t r Phone: 907-243-0668 135 Chdmenseo Dr., Ste. 2.,A 6. AK 99501 Fax: 907-243-1473 Email: sahile@8cind AOG(C 9202017 ITMO'. PROPOSED ENFORCEMENT ACTION AGAINST No dAq ENERGY Docket No. OTD I6-031032 Page 3 1 P R O C E E D I N G S 2 (On record) 3 CHAIRMAN FRENCH: It's 10:02 in the morning on 4 September 20, 2017. We're here at 333 West Seventh 5 Avenue, the offices of the Alaska Oil and Gas 6 Conservation Commission. Again September 20th, 10:00 7 a.m. here at the offices. To my right is Commissioner g Cathy Foerster, to my left is Commissioner Dan Seamount 9 and I am Hollis French, Commissioner of the AOGCC as 10 well. 11 We're here on docket number OTH 16-032 which is 12 NordAq Energy's application for reconsideration of the 13 decision and order issued in this matter by the AOGCC. 14 At the request of NordAq Energy we've scheduled this 15 oral argument. The subject of the hearing is our 16 decision and order on the civil penalty and the 17 reduction of the proposed bond amount. 18 We have the proceeding being recorded today by 19 our first rate staffer, Jody Colombie. You can get a 20 copy of the transcript from Computer Matrix which is -- 21 who actually handles the recordings when this hearing 22 is over. 23 NordAq is here to present. There won't be any 24 testimony today from anyone else, this is just an oral 25 argument. We will hear the presentation. Computer Mae %, LLC Phone 907-241-0668 13s Cnnstensen R.. Ste. 2.. Ancn. AK 99501 Fax907-243-1473 Emall'. saM1'dea ganef AOGCC 9202019 ITMO. PROPOSED FNFORCFMEN F ACTION AGAINST Num A,ENERGY Decker No 01 16-01032 Page 4 1 Commissioners may ask questions during the 2 presentation. We will certainly take a recess at the 3 end of the presentation, confer with our senior staff 4 and then come back and if we have any questions present 5 them at that time as well. 6 For you, Mr. Brena, keep in mind that you must 7 speak into the microphone so that those in the audience 8 and the court reporter can hear your testimony. 9 We do have some people online listening in I 10 think from the Peninsula Clarion, but perhaps not. 11 UNIDENTIFIED VOICE: That's correct. 12 CHAIRMAN FRENCH: I'm sorry. We just heard a 13 voice, yes? 14 (No audible response) 15 CHAIRMAN FRENCH: We've been given to 16 understand that the Peninsula Clarion was going to be 17 listening in, but doesn't appear that they're on the 18 line. 19 COMMISSIONER FOERSTER: In here. 20 CHAIRMAN FRENCH: Oh, I'm sorry. In the room. 21 Beg your pardon. Thanks for the clarification. 22 Mr. Brena. 23 (Off record comments) 24 MR. BRENA: Chairman French, Commissioners 25 Foerster and Seamount. First thank you for the Computer MaErx, LLC Phore 901-243-0668 135 Chnsumsm Dv_ Sm. 2., Arch AK 99501 Fax'. 909-243-14]3 Email sahlle�a 0anei 9/208017 f O: PROPOSMD FORCEMENTACUONAGAMSTNor gENERGY Docket No, OTH 16-0311032 Page 5 1 opportunity for this oral argument, I realize that it 2 was discretionary. My name is Robin Brena with the 3 firm of Brena, Bell and Clarkson. 4 COMMISSIONER SEAMOUNT: Mr. Brena, perhaps you 5 could sit down and speak closer to the microphones 6 because our court recorder is deaf. 7 (Off record comments) g MR. BRENA: So thank you for the opportunity. 9 My name is Robin Brena, I'm with the firm of Brena, 10 Bell and Clarkson and I'm here on behalf of NordAq 11 Energy, Inc. With your permission I'd like to also 12 introduce, we have representatives of NordAq here, 13 Doris Chang, the vice chairman of (indiscernible - away 14 from microphone). She's sitting behind me in the 15 center. David Pfeiffer, the chief financial officer 16 for NordAq is here, sitting there. And then Robert or 17 Bob Warthen who's the senior advisor to NordAq and was 18 a former president and CEO of the company are with me. 19 And then Laura Gould is an attorney with our firm and 20 is also sitting behind me. 21 I'd like to spend a minute just talking about 22 NordAq so you get a better sense for who they are and 23 why we're here. NordAq is a small, independent 24 producer with a lease interest on the North Slope and 25 the Cook Inlet. NordAq is taking the risks to come to Computer Metrix, LLC Phone: M-2434 8 135 Chrig.. @., Ste. 2., Ancch. AK 99501 Fox: 907-243-1473 Email: xa fl.(.,i.nm AOGCC 9/20Q017 f O: PROPOSED ENFORCEMENTACTION AGAINST NordAq ENERGY Dockd No. OW 16-031/032 Page 6 1 Alaska and to drill exploratory wells, oil and gas 2 wells, with the -- trying to expand the resource base 3 in Alaska. That is exactly the kind of company that we 4 want in Alaska more of. We want independent producers 5 coming up here and drilling exploratory wells, trying 6 to expand our resource base. I think that's a very 7 important point. g It's not just that they come to our state and 9 are doing exactly what we want the independent 10 companies to do, but it's the way they've done it. 11 They hire a third party compliance officer with regard 12 to their drilling and they coordinate very well with 13 people. They've tried to do it right with regard to 14 the Shadura well on the Kenai Peninsula. It has state 15 park land, it has state land, it has federal refuge 16 land, it has layer after layer after layer of 17 challenges, compliance challenges, and NordAq has never 18 received a single letter or comment of noncompliance in 19 the time that it's been operating in this state. 20 So they're a small, independent, they're not a 21 major, they need to be -- that means some things we'll 22 get into in a minute. They're here to expand our 23 resource base and drill exploratory wells, something 24 that many of the majors are not even doing in our 25 state. And they're doing -- they're trying to do it Compute Mute, LLC Phone: 909.243-0668 135 Christeoscv Dr., Ste. 2., Md. AK 99501 Fac 909-243-1493 EmuJ: uhd 8ci vd AOGCC 9ROR017 17 0: PROPOSED E ORCEM NTACnON AGANSTNordAq ENERGY Docks No. OTD 16-031/032 Page 7 1 right. And they have a history of doing it right and 2 coordinating closely with this Commission and with its 3 inspectors as well as multiple other people that are 4 engaged with the complex challenges of developing our 5 resource in refuge and on state park land. 6 So I want to acknowledge as I would hope that 7 you do that these are the kind of good citizens, good g corporate citizens, that matter in Alaska and that are 9 trying to make a difference and they're trying to do it 10 right. 11 we're here today to talk with you about first 12 lifting the bonding requirement with regard to the 13 Tiger Eye well. The reason that we're going to ask you 14 to do that and I will detail that argument in a moment, 15 I'm just summarizing the argument now, is because the 16 work's done, it's been plugged and abandoned and 17 there's no reason for a bonding requirement to ensure 18 that work gets done that's already been done. So 19 that's with regard to Tiger Eye bonding. 20 With regard to Shadura we're here to ask you 21 for some flexibility with regard to the bonding 22 requirement so that we can get the job done without the 23 financial burden on the company of an unnecessary 24 bonding requirement. We think that you should give us 25 the flexibility because you were flexible with us with Computa Metrix, LLC Phone: 907-243-0668 135 Christensen R., Ste. 2., Anch. AK 99501 Pax: 907-243-1473 Email: sah0e(m'ana AOGCC 920_201) 1'MO'. PROPOSED LNFORCEMENr ACI ION AGAINST NordAq ENERGY Docket No_01H 16-031012 •�- 1 regard to Tiger Eye and we've demonstrated our 2 willingness and ability to do the things that we said 3 we'd do for you. And so now they're done. I think 4 that should count for something here. So our 5 willingness and capacity to proper abandon, this has 6 been demonstrated, the work has been fully permitted, 7 the work has been fully contracted, there's an AFE 8 that's been approved by the company, the funds are 9 available to complete the work at Shadura to plug it 10 and abandon it properly. We've already spent between 11 40 and $50,000, it's fair to say that that project is 12 in mid project, it's not -- we're not promising 13 something in the future, we're doing it and we've done 14 the permitting, the permitting is complete, the 15 contracting is complete and all we're waiting for is an 16 opportunity for the weather to permit an 18 foot wide 17 snow road to be built so we can get eight foot light 18 equipment in there and do the job that we said that 19 we'd do and we currently plan to have that done by the 20 end of February. 21 So and then after I talk with you about each of 22 these wells and the bonding requirements and some of 23 the history and how you've worked with us and I'd like 24 to talk about the penalties for our failure to comply. 25 I mean, we're not here saying that we complied, we have Compumr Matrix. LLC Phone-. 007-243 066S 135 Chnslenseo U'Nta 2_ Anch_AN 99901 F., 907-243-1473 P nad_ sahile(a gecnd AOGC'(' 920'_01] ITMO'. PROPOSLDLNFORCF_MENTAC'T10NAGAINSTNordAq LNERGl' Docket No.OM 161131032 Page 9 1 an obligation to when the leases expire to properly 2 abandon these wells. We understand that, we 3 acknowledge that, we should have communicated with the 4 Commission, we should have explained why we were doing 5 what we were doing, asked for your permission for 6 relaxation of that requirement. We did not, but there 7 are circumstances, the mitigation circumstances set g forth in AS 31.3150(b). We think that they favor some 9 flexibility with regard to the penalty that's been 10 assessed. So that's a summary of what I'm going to 11 talk about today. there were not signs 12 First let me just talk for a minute about Tiger 13 Eye. The Tiger Eye is a well on the west side. Any 14 well on the west side as you know is a little more 15 complicated, you have to have camps, you have to fly 16 parts and people in and fuel and you have to stockpile 17 things on the side. You have circumstances of weather 18 and transportation, you're off the road system, it's a 19 more complex sort of situation. Tiger Eye was intended 20 originally to be an exploratory well for oil and gas 21 and it turned out there were not signs of oil and so it 22 was converted into an exploratory well for gas only. 23 It was between 10 and 11,000 feet deep. As I mentioned 24 on both of our projects we had third party compliance 25 officers. All American Oil Field, a well respected Computer M..,. LLC Phones. 907-'_41-0665 135 Cbmtce en Dr.. Ste. 2., Anch, AK 99501 Pat_ 907-243-148 FnraiL stthlle(t goon 912012017 DMO: PROPOSED ENFORCEMENTACHONAGAINSTNor gENERGY Docks No. OTH 1&031(032 Page 10 1 third party provider of these sorts of services worked 2 with us every step of the way, we wanted to be sure we 3 were in compliance with the permitting, with the proper 4 drilling requirements and with all the requirements. 5 We found gas in Tiger Eye at about 6,000 feet, we found 6 about 3 million a day. And that's a pretty good well 7 all things considered, but we had problems with the 8 encroachment of water into the well and it was a saline 9 water, it wasn't a freshwater that gives more 10 flexibility in terms of what you do with it. It was a 11 saline water and so we didn't have an economic solution 12 for how to manage the water and so we were -- we did 13 everything that we could with it. We came to your 14 staff and we submitted an AFE that said it would take 15 us $666,602 to plug and properly abandon that work. 16 It's been done. The cost ultimately was slightly over 17 700, between 700 and 720. And the reason for that 18 additional cost had to do with -- there was an 800 foot 19 ice plug in the well that we had to that we had to 20 address, we had to bring up a special tool that they 21 use for dewaxing wells, we had to fly in a person with 22 it and so it ran the cost a little bit up. Important I 23 think for this conversation is that but for that 24 unusual circumstance of that ice plug we would have 25 come in under the AFE that we submitted to the Computes Manu, LLC Phone: 907-243-060 135 Chtistcna Dr., Ste, 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahik(a'Sci.nd AUGCC 9^_02017 ITMO_ PROPOSED ENFORCEMENT AC EION AGAINST NordAq ENFRGY D dket No. OTT[ I6-031032 Page 11 1 Commission as the AFE that -- to get the job done. And 2 that'll matter I think in a moment because we have an 3 AFE for Shadura and we're asking you to give 4 credibility to that AFE and we think that our 5 performance under the AFE at Tiger Eye gives you just 6 reason to do that. 7 So the Commission, I want to acknowledge its g work with us. I mean, it changed from a check to a 9 bonding requirement for example, trying to lessen the 10 impact on a smaller, independent company I think was 11 your intention. I just wanted to mention that we 12 appreciate the effort. Bonding is worse than the check 13 for a small company because unlike the majors if you 14 try to get -- or that have private facilities and 15 letters of credit and bonding capacity sometimes 16 through affiliates and efficiently and cheaply provide 17 those sorts of assurances, independents have to go out lg on the insurance market and that's a difficult thing to 19 do here. Ultimately for a small, independent -- in our 20 case we checked on it, they wanted 100 percent of the 21 bond amount in cash plus they wanted a 2 or 3 percent 22 fee. So while you were trying to work with us, I -- 23 that was my sense of your shifting from check to 24 bonding, in fact it was -- had a greater financial 25 impact on a small independent. It would have been an Compwer Mz,.., LLC Phone. 907-243 0668 115 Chrivensen Dv. Ste.2_ An,h, AN 99501 170x:907-243-1473 Email'. s�Ile/o 9ci nu AOGCC 9 301011 ITMO. PROPOSED LNI OR( EMENI ACTION AGA INST NordAq ENERGY W,Lk No.OTH 16-031033 Page 12 1 appropriate way to work with a major that had those 2 sorts of large credit facilities available, but in our 3 case it isn't. So I wanted to just bring that to your 4 attention 5 The bond, you worked with us on the bond 6 amount. Based on our AFE you reduced the bond amount 7 from a 1,300,000 to 800,000. Thank you for that, the 8 AFE was 666,602. And we -- and you worked with us with 9 regard to the schedule on Tiger Eye. We asked you for 10 an opportunity to complete the work before the bonding 11 requirement was imposed on us and effectively that's 12 what's happened. And so we're here asking now for a 13 lifting of the bond requirement because the work is 14 completed. We filed with the Commission yesterday 15 afternoon all the paperwork to demonstrate proper 16 abandonment of this well. And our -- my understanding 17 is that all the work has been signed off on by 18 inspectors so I don't believe that there's an issue 19 about whether this well has -- there's not an issue 20 that I'm aware of about whether this well has been 21 properly plugged and abandoned. 22 COMMISSIONER FOERSTER: But, Mr. Brena, may I 23 please interrupt you for a second. Have you -- we know 24 that you've P&A'd the well, have you cleared the 25 location as well? Cmvpurer Mainz. LLC Phone 907-243-0669 135 Chr tensen Dr.. Ste 2., Anch. AS 99501 Fax907-243-1471 ft,i,tahild,,g tnet AOGC(' 9]0301] IITAO- PROPOSED ENFORCENEN I ACTION AGAINST NoedAq ENERGY Wdc ,No_01H16-031032 Page 13 1 MR. BRENA: Hmmm..... 2 COMMISSIONER FOERSTER: Okay. Thank you. 3 MR. BRENA: Yes. I'm sorry, Commissioner, but 4 I didn't know that answer, Commissioner Foerster. 5 So the work is complete and we appreciate you 6 working with us in terms of the check to bond, we 7 appreciate you working with us with regard to the 8 amount of the bond, we appreciate you showing the 9 flexibility and working with us with regard to the 10 timing of the bond. And the result is that it's worked 11 out perfectly for all of us. And so now we request 12 that the bonding requirement be lifted from Tiger Eye. 13 With regard to -- I start with Tiger Eye 14 because we do the things that we say we're going to do 15 and we've done them and we've demonstrated that and we 16 think that should stand for something. 17 With regard to Shadura, we have an AFE for 18 Shadura that's $483,826. We're..... 19 COMMISSIONER FOERSTER: Say that number again, 20 please. 21 MR. BRENA: 483,826. 22 COMMISSIONER FOERSTER: Thank you. 23 MR. BRENA: Shadura is a simpler well. Shadura 24 is 2.1 miles from the road system, it's on the east 25 side and not the west side of Cook Inlet, it was a Compmer Malnx. LLC Phone 907-243-0668 135 Chnstensm @. Ste. 2.-An,h. AK 99501 Fax: 90]-243-14A Emal sahlleee0einei AOGCC 9 20'_017 ❑MO'. PROPOSED ENFORCEMENT ACTION AGAINST NONAq ENERGY Docket No.01H 16-031 032 Page 14 1 straighter bore. We have stockedpiled in place cement 2 to manage the plugging. We have all the permitting in 3 place, we have all the contracting in place. We have 4 an approved AFE, we have the funds available to fund 5 that AFE. There is -- we have spent 40 or $50,000 6 already in terms of permitting and the other things 7 that are necessary to prepare properly, surveying, 8 engineering work. And all we want -- all we need now 9 is the weather to get cold enough to put in a snow 10 compacted road. So we're not ducking, we're not 11 weaving, we are -- we're in mid project and we're going 12 to be done by the end of February. The snow road, we 13 need a 2.1 mile snow road, we need it to be 18 feet 14 wide so we can move through eight foot equipment, it'll 15 take 10 to 13 days to complete. The well work is 16 relatively straightforward, it'll take seven to 10 days 17 to complete. It has fewer plugs, three, than are 18 required in Tiger Eye which took five. And there's no 19 camp necessary, the workers can go home, no barging, no 20 air transport of equipment, there are none of the 21 complications, logistical complications, that you often 22 find when we're discussing the west side, the west side 23 well. So we think that our AFE is rock solid, we think 24 that there are fewer risks associated with the AFE for 25 this well compared with the one on the other side. And Computer Metrix, LLC Phone'. 907-243-0668 135 Chmtenson Dr., Ste 2. Anch. AK 99501 F. 907-243 14 73 Emei1'. sahilea eci.ne AOGCC 930 2019 ITMO. PROPOSED LNFORCEMEN'T ACTION AGAINST NerdAq ENERGY Dodet No.O1'H 16-031032 Page 15 1 we performed on the one on the other side and ran 2 across one unusual circumstance or we would have been 3 under budget on that one and we managed that unusual 4 circumstance within a reasonable range. 5 So the bond that's imposed on us for Shadura is 6 $1.2 million. And the holding by the Commission in the 7 decision and order was that we presented no evidence g that a reduction in the bond amount was appropriate. 9 We're confused by that whole thing because we presented 10 two AFEs, the AFE on Tiger Eye was taken into 11 consideration and our bond was lowered. The AFE that 12 we presented with regard to Shadura was not recognized 13 in the order and in fact the opposite was stated, that 14 there was no evidence that it should be reduced. So I 15 don't -- it's hard -- I assume that that was an 16 oversight, clearly an AFE detailing the timing and 17 amount that's necessary and the stage of the project 18 and affidavits of people are clearly evidence that 19 suggests that the bond amount is greater. The Shadura 20 bond amount and AFE are going to be less, they're going 21 to be less than the Tiger Eye one. 22 And so we want -- we're here to ask you for 23 some flexibility for the schedule for this bonding 24 requirement like you gave us on Tiger Eye. We're here 25 to ask you first and foremost if you can delay imposing Computer Ma=. LLC Phone .907-243-0668 135 Chd tmsen U'.. Ste. 2, Att&. AK 99501 Fac 907-243-I47i Emeil: sahllc(ayci.net AOGC( 9203019 ITMO'. PROPOSRDENFOR('EMFNTACIIONAOAINSTNoidAgF LR(;)' Dockci NoOTII 16 MI 031 Page 16 1 that requirement until the end of February to give us 2 an opportunity to do what we're in the middle of 3 getting done. We think that you have assurances in 4 that we've already performed on Tiger Eye, we think you 5 have assurances because we have our contracting in 6 place, we have our permitting in place, we've already 7 spent 40 or $50,000, this project is a simple project, g we've demonstrated our willingness and capacity to 9 perform this work and we intend to perform it and we're 10 here to say that we intend to perform it. And so we're 11 asking for the same kind of flexibility you gave us on 12 Tiger Eye where you gave us, you know, a couple months 13 and gave us a chance to get the work done, otherwise 14 this is a tremendous financial hardship for this 15 company to come up with these kinds of funds 16 unnecessarily in the middle of a project. And so my 17 first request is that you give us -- that you allow us lg until the last day of February before this is imposed 19 and if we don't get the work done when we said we'll 20 get it done then we'll be back here explaining why not 21 to you. But we're doing it, we're in the middle of 22 getting it done and imposing such a financial hardship 23 on such a small company is from our point of view not a 24 commercially reasonable way to proceed. The second 25 thing is if that doesn't work, 1 mean, we just plugged Compua+Mm... LLC Phone. 907 -NI -W8135 ChmIcnsen Ih_ Ste?.. Anch. AK 99501 Fox 907-^_4}1471 Emml sahilrra gci.nel AOGC( 9^_02017 MIO '.PROPOSEDFNFORCFMENIACTIONAGAINSTNordAgliNFRGI' DO,ketNo OTH 160;1 OL 8 and based on our performance and just give us until 9 February to get the job done and if we don't get it 10 done then we'll revisit the issue. Secondly if -- we'd 11 ask you to be flexible enough with the schedule so that 12 we can get the bond that already exists that Page 17 1 and abandoned Tiger Eye, we have a $500,000 bond that 2 is going to be released to us, and so allow us a couple 3 months to get that bond freed up from Tiger Eye so that 4 we can apply it over here. So, but 500,000 is more 5 than our AFE that's been contracted for, there is 6 virtually no risk in you permitting that. 7 So first we'd ask you to take us at our word 8 and based on our performance and just give us until 9 February to get the job done and if we don't get it 10 done then we'll revisit the issue. Secondly if -- we'd 11 ask you to be flexible enough with the schedule so that 12 we can get the bond that already exists that will be 13 released because of our proper abandonment of Tiger Eye 14 and be able to use that facility to cover this. We 15 think that this is in the public interest, we think it 16 sends the right signals to the community and so we 17 would ask you for that. 18 I want to turn now to the penalties. we were 19 assessed a penalty for an initial violation of failure 20 to properly abandon under 31.30.150(a) as set forth in 21 the regulation 20 AAC 25.105(a). So that penalty, the 22 maximum amount that can be assessed as an initial 23 violation is $100,000 under your regulations. We've 24 been assessed $100,000 for both of them, we've been 25 assessed the maximum fine both times. Computes Matnrc_ LLC Phone'. 907-243-0668 135 Dc. Stc 2.. An,h. AK 99501 F., 907--243-1473 Email'. sa J&11 pci W AOOCC 9202017 I1MO PROPOSEDFNFORCFMENTACTIONACAINSTNordAq ENER(i)' D,,&c, Na. OTII 16 031 031 Page 18 1 I'd like to just go through the mitigating 2 factors because we think that penalties should be -- 3 you know, should reflect the facts and circumstances of 4 an individual case. And in fact the statute requires 5 you to take into consideration these factors, it's not 6 discretionary, it says you shall consider these 7 factors. And so I'd like to just go through each 8 factor and talk with you about them for a minute 9 because a maximum penalty under this circumstance, I 10 mean, with Tiger Eye we thought there were other 11 commercial opportunities and people interested in 12 continuing the well and it really wouldn't have been in 13 the public interest to plug and abandon a well that may 14 be commercially viable and that other people may be 15 interested in. 16 In Shadura we had a similar circumstance and we 17 were intending to initially branch off of that well, 18 use that wellbore for additional drilling and that 19 didn't prove viable. So in both situations we weren't 20 ignoring anything, we were trying to make wells work in 21 Alaska which is in the public interest for you to 22 allow. And now we didn't communicate what we were 23 doing to you and so we're not asking for no penalty, 24 we're asking for a penalty to be assessed at $10,000 in 25 each case. And we'll make a commitment to you that -- Computer Malnx, LLC Phone_ 907-243-0668 135 Chnslensrn DT,S11. 2.. An,h. AK 99501 Fax907-24; F..1 sA le'µpnoq AOG('( 9/20/2011 tWO: PROP(1SEDENFORCEM TACTIONAGANSTNo,dAq ENERGY DocketNo.= 16-031/032 Page 19 1 I mean, someone would have to be crazy to ignore a 2 notice from this Commission and we certainly don't 3 intend to and we intend to work with you and you will 4 not see us in here again for our failure to 5 communicate, in fact you might be standing at the door 6 with a bat because we're over here too darn much for 7 you. g So, but let me go through these mitigation 9 factors. It says in determining the amount of the 10 penalty assessed under (a), the Commission shall 11 consider the extent to which the person's acting in 12 good faith. I don't -- you know, there isn't a bad 13 faith finding in any of your orders, I don't -- I'm not 14 aware of any facts that even suggest one. 15 (2) says willfulness and knowing manner, I 16 mean, we were trying to extend the commercial viability 17 of two wells, we weren't walking away from them and not 18 fulfilling our duty to abandon properly, we were trying 19 to find a way to make them work for people involved. I 20 don't think that rises to sort of a willfulness. 21 (3), the extent and seriousness of the 22 violation, actual or potential threat to the public 23 health or environment. There's a specific fact holding 24 that there was no risk at all. The only thing that 25 happened was the delay of time. There's never been a (',—,, , Mm,ix, LLC Phone: 901443-0668 Emvl: sahileC46ci.nn 135 Choi tmn a., Ste. 2., Anch. AK 99501 Fu: 901-243-1413 AOGCC 92012017 ITMO: PROPOSMD FORCEMENTACTIONAGAMSTNordAq ENERGY Pocket No. M 16-0311032 Page 20 1 safety risk, there hasn't been a pressure issue, there 2 hasn't been a blowout issue, there's no public health 3 issue in this case, these are just wells with a small, 4 independent trying to figure out how to make them work 5 when the leases expired. 6 Injury to the public, there is none. There is 7 absolutely no injury to the public. g Benefit derived. We are not getting any g benefit from not doing this whatsoever. 10 History of compliance or noncompliance. We 11 have a rock solid history of compliance. We think that 12 our Shadura efforts demonstrate that, I mean, we've 13 been under federal refuge, state park and state lands 14 and operating with third party compliance officers and 15 without one notice of noncompliance for several years. 16 We're not some fly-by-night company up here, you know, 17 trying to short circuit the rules and regulations and 18 not respect them. We're the opposite of that, we're 19 incurring additional expense and cost trying to do it 20 right. 21 Deter similar behavior. I don't know, you 22 know, the deterral impact, I think that's largely 23 diluted. I mean, the facts and circumstances of each 24 case are so unique that I'm not sure how that works, 25 but in terms of deterring similar behavior I think a Computer Matrix. LLC Phone:%7-243-0668 135 Christeesen D.., Ste, 2., Anch, AK 99501 Fez 90]-243-14]3 Emailaahile@Bci.net AOGCC 9^_02017 [TMP. PROPOSED LNFORCEMFNT ACTION AGAINST NoIJA4EvERGY Docket No OTFI 16031 A32 Page 21 1 $10,000 fine lets people know that if you're going to 2 try and find a way to extend the life of wells past the 3 expiration of the lease that we ought to be talking to 4 you and explaining what we're doing and getting your 5 permission to do it. 6 And so that's the behavior, this isn't putting 7 the public at risk, this isn't putting people at -- 8 there's no safety risk, there's no environmental risk, 9 there isn't any of the kind of bad acts behavior that 10 would bring up your guard hairs to impose a maximum 11 fine. An effort made by the person committing the 12 violation to correct it prevents future violations. I 13 don't know how you can get a better record than the one 14 that we've established, we've done the things we said 15 we'd do, we've spent the money we said we'd spend and 16 going forward we have contracts in place, we have a 1.7 timetable in place, we have the permitting in place, lg we're acting as best a corporate citizen of Alaska as 19 we're able to and other factors considered relevant. I 20 -- you know, I thought about this one. I think this 21 Commission should care about the culture that it 22 creates in Alaska for independent producers, I think 23 you should care about that. We are not BP, these bond 24 impositions and penalties, they hurt us, they hurt our 25 ability to operate. And so the one size fits all Computer Matnx. LLC Phones 909243-0668 115 Chnsteosm Dr., Ste. 2. Anch. AN 99501 Fan 907-243148 Lmeil eahilcngai.cet AOGCC 9^_0201) FIMOP. PROPOSED FNFORCFMENF ACTION AGAINST NOIdAq ENERGY Dockn NoOTp 16-031 031 Page 22 1 really doesn't fit all. You know, what you need to do 2 to punish one person isn't what you need to do to 3 punish another, there are just different circumstances. 4 And I would -- and, you know, I don't use this as an 5 excuse because I'm not offering any excuses today for 6 not communicating properly to the AOGCC. I'm not 7 offering any, we didn't and we should have and we will g in the future. 9 But I think it's important for you to at least 10 be aware of that we had $9 million in credits that 11 should have flowed from the state to us that have not 12 been appropriated. so we're in Alaska, operating at 13 additional expense with third party compliance 14 officers, without any notices, without any 15 noncompliance in Alaska, trying to do our best in 16 Alaska drilling exploratory wells, we as Alaskans 17 should be begging companies to come up and do. And 18 we've done it even though the state of Alaska 19 ultimately -- it was expected that we were expected to 20 be paid $9 million and we aren't using a penny of that 21 money to suggest that any of that has anything to do 22 with this. I bring it forward not as an excuse, I 23 bring it forward because that's the culture that we're 24 operating in, small, independents were impacted by 25 those decisions and we are honoring our commitments to Com In Matnx. LLC Phone_ 90)'_43 M65 pn . 907-24} 1471 Emal sahlyn� gefnel 135 Chnslensni Uc, 5¢. 2.. Anch. AK 99501 Fax' AOGCC 920201- ITMO', PROPOSED ENFORCCMENTACTIONAGAINS I Nn,dAq ENERGY Docket Nu.OTH 16-031 032 Page 23 1 the state notwithstanding that being hammered by the 2 failure to appropriate funds to reimburse for $9 3 million in drilling costs. 4 So I don't know, you know, we're the people you 5 want here doing what we're doing and doing it the way 6 we're doing it. And so we have the only penalty that's 7 been assessed, it's for an initial violation of failure g to abandon properly and that initial violation has a 9 maximum of 100,000 and we've been assessed the maximum 10 of 100,000. And we don't think that that's a fair 11 assessment under these facts and circumstances and so 12 we would ask you to -- for some flexibility on that, 13 it's not like we're not stepping up to the plate and 14 swinging the bat and it's not like we're not hitting 15 the balls that are being thrown, we're doing both. 16 That's what we're here to ask you for, 17 continued flexibility working with us and, you know, 18 and rationalizing the fine to something that fits the 19 facts and circumstances of our case. 20 I'm happy to respond to any questions you have. 21 I understand we're going to take a break and you're 22 going to get a chance to talk to staff and then come 23 back and ask more questions, but our -- whatever, I'll 24 be happy to answer any questions that you have. 25 CHAIRMAN FRENCH: Mr. Brena, thank you for the Compete, Mattie, LLC Phone. 907--243-0666 135 Chd tet sen Da. Ste. 2., Aach. AK 99501 Pax_ 907-243-149? Email sahilmkydnet AOGCC 9 20 2017 DMO .PROPOSED E.NFORCFMENf ACDON AGAINSTNo,dAq ENERGY Docket No. OTH 16-031'032 Page 24 1 presentation. Commissioner Foerster, any questions 2 now? 3 COMMISSIONER FOERSTER: I have several 4 questions, but I'll keep them until after the break. 5 CHAIRMAN FRENCH: Commissioner Seamount, any 6 questions now? 7 COMMISSIONER SEAMOUNT: Yeah, I have a few g questions before we take the break in case we need to 9 address them. First of all I'd like to say that I'm 10 sorry that you couldn't make these wells economic and I 11 assume that Mr. Warthen was the one who generated these 12 prospects. And I've known him for 30 years and I think 13 he's the foremost oil and gas explorer in Cook Inlet 14 over -- the majority of prospects drilled in Cook Inlet 15 have been Mr. Warthen's. 16 But having said that, I have a few questions 17 which probably will come up in the break, but I'd like 18 to bring them out right now. And that is -- well, 19 first of all does NordAq have any production or 20 activities outside of Alaska? 21 MR. BRENA: (Indiscernible - away from 22 microphone)..... 23 UNIDENTIFIED VOICE: No. 24 COMMISSIONER SEAMOUNT: Okay. You're totally 25 Alaska based? C'ompow Matrix. LLC Phone 907-241-0668 115 Chnstccsen Ih_ So, 2._ Anch. AK 99101 Fac 907-'_43-1471 Emnl sahilmn pci.nn AOGCC 9 20 2019 ITMOI PROPOSED ENFORCEMENf ACTION AGAINST NmdAq ENFRGY DO,km No_OIH 16-03103? Page 25 1 MR. BRENA: Okay. 2 COMMISSIONER SEAMOUNT: Our AFE, I mean, that's 3 what it would probably cost the state to plug these 4 wells if NordAq were to run off? So..... 5 MR. BRENA: I'm sorry, Commissioner, would you 6 please..... 7 COMMISSIONER SEAMOUNT: Which is $1.2 million. 8 Okay. Now you've got an AFE for $483,000. Does that 9 AFE include your ice road? 10 MR. BRENA: It's a snow road, Commissioner..... 11 COMMISSIONER SEAMOUNT: Yes. 12 MR. BRENA: .....and it does. And there's 13 seven to 10 days associated with the compaction of a 14 snow road. 15 COMMISSIONER SEAMOUNT: Okay. Does it..... 16 MR. BRENA: The equipment..... 17 COMMISSIONER SEAMOUNT: .....does it include 18 mob and demob? 19 MR. BRENA: My understanding is that's it's an 20 all in price. 21 COMMISSIONER SEAMOUNT: Okay. So is all the 22 equipment in place in Cook Inlet or do you have to 23 bring it in from North Slope or other places? 24 MR. WARTHEN: All in place. 25 CHAIRMAN FRENCH: Why don't we take a quick Compmer Mavis. LLC Phone. 907-243-0668 135 Chmtensen Dr.. Sm.'_. And. AK 99;01 F. 907-243-1493 Email sahilIX beinet AOGC(' 9202017 ITMO. PROPOSED FNFORCEMENI ACTION AGAINST NONAq LNERM Docket No. OTI1 16 031-032 Page 26 1 pause here and identify this witness and have him sworn 2 in if we're going to get testimony from him. 3 MR. WARTHEN: Yes, I'm Bob Warthen senior 4 advisor for NordAq Energy. 5 CHAIRMAN FRENCH: Mr. Warthen, if you'd raise 6 your right hand. 7 (Oath administered) g MR. WARTHEN: Yes, I do. 9 CHAIRMAN FRENCH: Thank you. 10 BOB WARTHEN 11 called as a witness on behalf of NordAq Energy, 12 testified as follows on: 13 DIRECT EXAMINATION 14 CHAIRMAN FRENCH: Thank you. Commissioner 15 Seamount. 16 COMMISSIONER SEAMOUNT: One more question. Is 17 the crew guaranteed to be available when the road's 18 available? 19 MR. WARTHEN: Yes, they are. The crew are all 20 housed and domiciled in the -- on the Kenai Peninsula, 21 in the Kenai and Soldotna area. So, yes, they're -- 22 they will be available. 23 COMMISSIONER SEAMOUNT: Thankfully the low oil 24 prices I assume. 25 MR. WARTHEN: Well, correct. Compwa Mat—, LLC Phone907-243 068 115Che tr_ enses DSte. 2.. Anch_ AK 99501 F. 90]-2441471 Email: sahilua So no AOOCC 9 20 2017 I IMO_ PROPOSFD EN17ORCFMEN I ACTION AGAINSTN,,,dA, ENFRGY Do,Ur N. OT 14 16-03103'_ Page 27 1 COMMISSIONER SEAMOUNT: okay. That's all I 2 have. Thank you, Mr. Warthen and Mr. Brena. 3 MR. BRENA: Thank you. 4 CHAIRMAN FRENCH: I read the clock as saying 5 10:37. We'll take at least a 12 minute break and be 6 back at say no later than 10:55 a.m. 7 COMMISSIONER FOERSTER: As we go into recess I g notice that there are people in the room whose names 9 are not on the sign -in sheet. If you're one of those 10 people please add your name to the sign -in sheet so 11 that we have a record of all in attendance. 12 CHAIRMAN FRENCH: Thank you, Commissioner 13 Foerster, for that reminder. 14 COMMISSIONER SEAMOUNT: Oh, I..... 15 CHAIRMAN FRENCH: Commissioner Seamount. 16 COMMISSIONER SEAMOUNT: .....had one other 17 question. If the state were to have to do the work 18 would the contracts you have in place, would they 19 apply, could the state use them? 20 MR. WARTHEN: I assume that -- you know, we 21 have master service agreements with these companies so 22 I assume that the state has that opportunity to engage 23 with these companies also..... 24 COMMISSIONER SEAMOUNT: Okay. Thank you. 25 MR. WARTHEN: .....they would be willing to do Compmv Matrix. LLC Phrre907-243-0658 135 Chd,,.,n Dr.. Ste 2-. Arch_ AK 99501 Fax 907-241.1473 GmatLcahilcnpa.net AOGCC 1 the work. 9 ^_0201] ITMO'. PROPOSED E,NI ORCEMENT ACTION AGA1NS I No,dAq ENERGY Dock,,NO.OTH 16-031 032 Page 28 2 COMMISSIONER SEAMOUNT: Thank you. 3 CHAIRMAN FRENCH: If nothing else we'll stand 4 in recess. 5 (Off record - 10:41 a.m.) 6 (On record - 10:53 a.m.) 7 CHAIRMAN FRENCH: We'll go back on the record. 8 The first thing I'm going to do is just correct that 9 while we -- I announced the docket number as OTH 16- 10 031, we have strayed into consideration of docket 11 number 0TH 16-032. And so I just want to make sure 12 that folks are alerted to that because we've taken up 13 both Shadura and Tiger Eye here today. That's point 14 one. 15 Point two is, my question for you, Mr. Brena or 16 Mr. Warthen, any one of you can answer these questions, 17 where are you in the process of getting the return of 18 the DR&R bond from DNR and do you have any expectation 19 or any date at which you expect to receive the return 20 of that bond? 21 MR. WARTHEN: No, sir, we have not -- we have 22 not processed that yet. We wanted to get our paperwork 23 in to the Commission before we turned that plug and 24 abandonment documentation over to the DR -- the DOG. 25 CHAIRMAN FRENCH: Thank you. That's -- those Compu0.n Mal.x. LLC Pho 907-243-0668 135 Chi Hensen Dr.. Ste?., An6 AK 99,01 Fa. -907-^_43-14]3 Emeil: sAlmg16el AOGCC 9202019 ❑MO. PROPOSED ENFORCEMENT ACTION AGAINST NofdA9 ENERGY Dockal N,, ATH 16 031032 Page 29 1 are my questions. Commissioner Foerster I think has a 2 couple questions. 3 COMMISSIONER FOERSTER: I do. 4 MR, BRENA: We would anticipate that to be a 5 month or two though. I mean..... 6 CHAIRMAN FRENCH: It's 30 to 60 days. Okay. 7 I'll -- thanks. Commissioner Foerster. g COMMISSIONER FOERSTER: Yes. First question, 9 did you put any contingency money into your AFE? 10 MR. WARTHEN: Sometimes we put 10 percent in. 11 COMMISSIONER FOERSTER: Did you? 12 MR. WARTHEN: Yes. 13 COMMISSIONER FOERSTER: Okay. Can you 14 demonstrate to us that the contracts that you say are 15 in place are in place? 16 MR. WARTHEN: Well, the only contracts that we 17 have are our master service agreement with All American 18 Oil Field. And then what they do is they subcontract 19 to various vendors in the Kenai area, you know, 20 Halliburton, Pollard Wireline, you know, whomever that 21 we have to use. The contract that we have in place 22 would be with Cardno Entrix which has been fulfilled 23 and that was for the permitting. The other contract 24 would be with Petroleum Engineers and that has been -- 25 that's ongoing from the standpoint that being sure that Compma Matrix_ LLC Ph.ne 907-241A 68 _ 135 Chnsmnsen Dc.Ste_2- Ands_AK 99501 Fu. 907 243-1473 E.A 'ahilnpgo,nu AOG('( 41_02017 DNO'. PROPOSFDGNFORCEMFN(ACTONAGAINSTNordAq ENERGY Docker No. 0111 16-031032 Page 30 1 we use Mr. Hennigan, you know, he's provided the basic 2 documentation for the P&A approval and he will continue 3 to work with the project as the project is commenced 4 and do the plug and abandonment paperwork when it's 5 completed. 6 MR. BRENA: And, Commissioner, there are two 7 affidavits attached to the reconsideration that go to g this issue as well. There's an affidavit of Peter 9 Dickerson who is the president of All American that 10 states that he has contracts or agreements with all the 11 vendors listed on NordAq's authorization for 12 expenditure to plug and abandon Tiger Eye and the same 13 with Shadura. That's paragraph eight of his affidavit. 14 So we have a sworn affidavit by the third party who has 15 the contracts and there is a affidavit of Steven 16 Hennigan concerning -- who's the -- who is with 17 Petroleum Engineers and discusses the engineering work. 18 I've been contracted by NordAq to provide engineering 19 services and interaction efforts for the abandonment of 20 Shadura. So we have affidavits -- two affidavits that 21 go to your question as well. 22 COMMISSIONER FOERSTER: Thank you. Can you 23 demonstrate that you have an approved AFE that will 24 stay in force until the work is done? 25 MR. WARTHEN: That we have an approved AFE? Comput¢ Metrix, LLC Phorc 907-243-0668 FinaiL sahilnp gcinp 115 Chnswmse Dr.. S11 2. Anch. AK 99501 Fax'. 907243-1493 AOGCC 9:20201) HNIO- PROPOSED ENFORCEMENT ACTION AGAINST NordAq ENERGY Docker No. DTH 16 011032 Page 31 1 COMMISSIONER FOERSTER: You stated that you 2 have an..... 3 MR. WARTHEN: Yes. Yes. 4 COMMISSIONER FOERSTER: .....approved AFE, can 5 you demonstrate that other than by saying it? 6 MR. WARTHEN: Well, in our company the board of 7 directors approves the AFE and that has been done. 8 COMMISSIONER FOERSTER: So..... 9 MR. BRENA: If you..... 10 MR. WARTHEN: Are you looking for the actual 11 AFE itself or..... 12 COMMISSIONER FOERSTER: That would be one part. 13 MR. WARTHEN: Yes, we have that. 14 COMMISSIONER FOERSTER: Is that..... 15 MR. WARTHEN: And that we -- I believe we 16 submitted that to the Commission. 17 COMMISSIONER FOERSTER: Okay. 18 MR. WARTHEN: Yes. 19 COMMISSIONER FOERSTER: But then that's one 20 part, but having worked in an industry -- in the 21 industry..... 22 MR. WARTHEN: Right. 23 COMMISSIONER FOERSTER: .....before myself I'm 24 familiar with if you get an approved AFE and then you 25 have a budget cycle and then the budget cycle ends and Compnmr Mmnc. LLC Phone. 909-243-0668 Emell. sehlle'a eci.nU 135 Chnsrensen D.. SN ^_.. Aneh_AK 99501 F&N 907-243-1471 AOGCC 920^201-1 DMO: PROPOSED ENFORCEMENT ACT ION AGAINST NOIdAq ENERGY Docket No-OTH I6-031032 Page 32 1 you start a new budget cycle the AFE goes away. So 2 there's more to the demonstration that the AFE is 3 approved and will remain than simply having the AFE. 4 MR. WARTHEN: Well, we do -- the AFE has been 5 approved within NordAq's management and the funding is 6 in place, you know, for that effort. I guess that's -- 7 that would probably be the only thing -- you know, I g understand where you're coming from, you know, having 9 myself worked for a corporation as to the process, but 10 somewhat different in our organization is that, you 11 know, we build the AFE, we get approval from the board 12 of directors, the board of directors finds the money or 13 designates the money for that particular project and 14 that has been done. 15 MR. BRENA: And it's a small enough company so 16 that the process that you've described that is the -- 17 where you go through sort of an annual capital, you 18 know, we -- that isn't how this company works. This 19 company has an AFE in place and it's authorized the 20 expenditures and set the funds aside. 21 COMMISSIONER FOERSTER: Okay. So you say the 22 funds are in place, the funds have been set aside. So 23 the money to do the work, how is it set aside, 24 characterize that for me? 25 MR. WARTHEN: Bank accounts, cash. Computer Matnx. LLC Phone', 90]-243-11668 135 Chnsensen Dr.. Sic 2.. Aceh. AK 99501 Pax 907 2411813 Email . sahileaget net AOGCC 920'_017 ITMO. PROPOSED I NFNRCfMENT ACTION AGAINST NOIdAq ENERGY Dockel N. OTA 16-031 02 Page 33 1 COMMISSIONER FOERSTER: So you have a savings 2 account..... 3 MR. WARTHEN: That's correct. 4 COMMISSIONER FOERSTER: .....with this money in 5 it for no other use than for this purpose? 6 MR. WARTHEN: That's correct. 7 COMMISSIONER FOERSTER: And you can demonstrate 8 that to us? 9 MR. WARTHEN: Yes, we -- yes. 10 UNIDENTIFIED VOICE: We don't have a separate 11 account, but we've got the funds set aside and I can -- 12 I can demonstrate that we have the money in 13 (indiscernible - away from microphone)..... 14 MR. WARTHEN: It's not an account designated 15 with the name on it, Shadura..... 16 COMMISSIONER FOERSTER: Okay. 17 MR. WARTHEN: .....funding, you know, it's a 18 general NordAq account. 19 COMMISSIONER FOERSTER: Okay. 20 MR. BRENA: Well, let me suggest too if it's a 21 requirement of the Commission that it be set up in such 22 an account that it be limited to that use, then we'd be 23 happy to do that just so that we can draw from that 24 account to do the job. 25 COMMISSIONER FOERSTER: Okay. Another question ComputerMam%, LIR Ph,, e.907-243-0668 Gsh. sehilca mtnn 135 Chn %m, n Dr.. Sw 2na .. An6. AK 99501 Pas: 907-243-1473 6 AOGCC 9202017 IIMO'. PROPOSED ENEORC EMENI ACTION AGA INS F NordAq ENERGY Docket No.OTH 16 031 032 Page 34 1 along those lines. Do you have the financial stability 2 to assure that that money will stay there and that 3 means do you have other -- do you have creditors that 4 you haven't paid yet, do you have other projects that 5 will be competing -- do you have a financial future 6 that guarantees that money won't be used someplace 7 else? 8 MR. BRENA: We will -- if it's a requirement of 9 the Commission we will set that fund aside for that use 10 only and provide those assurances..... 11 COMMISSIONER FOERSTER: Okay. 12 MR. BRENA: .....to the Commission in -- just 13 only subject to the ability to draw down to do that 14 work. 15 COMMISSIONER FOERSTER: And my last question is 16 what if next winter's a bad winter too and you don't 17 get the work -- can't get the work done next winter? 18 MR. BRENA: You know, if there's something 19 that's going to happen that's going to make us do 20 something different than what we're promising you we'll 21 do, we'll know about it ahead of time. So there will 22 be communication. I mean, who knows what the future 23 brings, but we're talking about 10 to 13 days to build 24 the compacted snow road and seven to 10 days, we're 25 talking about less than three weeks worth of work. So Computer Matrix. LLC Phone. 90]-243-0668 115 ChriM a,c,, U.. Ste_ 2.. Anch, AK 99501 Fax_ 907-243-1473 Email'. sahilu✓agcinq AOGCC 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 9/200017 TWO: PROPOSED ENFORCEMENT ACTION AGAINSTNooMq ENERGY Dock No. OM 16-031/032 Page 35 it would have to be -- so I don't believe we've ever had a winter that hasn't permitted that scope of work to be done. COMMISSIONER FOERSTER: Okay. Those are all my questions. CHAIRMAN FRENCH: Anything else, Commissioner Seamount? COMMISSIONER SEAMOUNT: I have none. CHAIRMAN FRENCH: Mr. Brena, Mr. Warthen, thanks so much for being here. With that we're going to conclude this hearing and we are adjourned. (Hearing adjourned 11:02 a.m.) (END OF REQUESTED PORTION) Compma Mauia, LLC Phone: 90]443-0668 135 Ch, onsm Dr.. Ste. 2.. Auch. AK 99501 Fac 90]-243-14]3 Email: sahik(o,'inq AOGCC 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 9202017 ❑MO: PROPOSED ENFORCEMENT ACTION AGAINST NordAq ENERGY Docket No -0TH 16-031032 Page 36 C E R T I F I C A T E UNITED STATES OF AMERICA ) )ss STATE OF ALASKA ) I, Salena A. Hile, Notary Public in and for the state of Alaska, residing in Anchorage in said state, do hereby certify that the foregoing matter; Docket No.: OTH 16-031; OTH 16-032 was transcribed to the best of our ability. IN WITNESS WHEREOF I have hereunto set my hand and affixed my seal this 26th day of September 2017. Salena A. Hile Notary Public, State of Alaska My Commission Expires: 09/16/2018 Cmnpmer Metrix, LLC Phone909-243-0668 Email sahile(nghnG 135 Chnsmn.en a,St, -'_.M6 AK 99501 Z 90'7--243-1473 September 11, 2017 Mr. Hollis S. French, Chair Alaska, Oil and Gas Conservation Commission 333 West 7th Avenue, Suite 100 Anchorage, AK 99501 RE: Submittal of 10-404 for P&A — Sundry 317-083 NordAq Energy, LLC Tiger Eye Central (41-24) (PTD No. 212-102, Sundries 313-324,313-239,313-172,313-105) Dear Mr. French, RECEIVED S€P202017 AOGCC NordAq Energy, LLC is providing Sundry documentation for the plug and abandonment of the above referenced well. Documentation includes (numbered by electronic order) Form 10-404 Wellbore Diagram Operations Summary Pressure charts Cementing job reports Septic closure cert Pictures of casing art off and welded plate Pictures of well location area. If you have any questions or require additional information, please contact Stephen Hannigan at (337) 849-5345 or Robert Warthen, Senior Adviser, NordAq Energy, LLC at (907) 646-9315. Sincer l � R bert Warthen Senior Advisor NordAq Energy, LLC Enclosures Cc: Pete Dickinson All American Oilfield Stephen F. Hennigan Petroleum Engineers Consulting Project Engineer for NordAq Energy, LLC STATE OF ALASKA ALASKA OIL AND GAS CONSERVATION COMMISSION REPORT OF SUNDRY WELL OPERATIONS 1. Operations Abandon Plug Perforations Fracture Stimulate Pull Tubing Operations shutdown Performed: Suspend Perforate Other Stimulate Alter Casing Change Approved Program Developm Plug for Reddll Perforate New Pool Repair Well Re-enter Susp Well Oder. 2. Operator 4. Well Class Before Work: 5. Permit to Drill Number. Name: NordAq Enerily, Inc Development Stratigraphic Exploratory Service 212.102 3. Address: U. API Number 560 E. 34N St. Anchorage, AK 99503 50-133-20005{10-00 7. Property Designaflon (Lease Number): 8. Well Name and Number. ADL 391104 and Private Fee land Tiger Eye Central (41.24) # 1 9. Logs (List logs and submit electronic and printed data per 20AAC25.071): 10. Plexi/Pool(s): See attached Wildcat W Cook Inlet area 11. Present Well Condition Summary: Total Depth measured 10,750 feet Plugs measured See WBD feet true vertical 10157 feet Junk measured See WBD feet Effective Depth measured 0 feet Packer measured See W8D feet various has vertical 0 feet I" vertical gree W8D feet Casing Length Size MD TVD Burst Collapse Structural 141 20.00 141 141 no 770 Conductor 808 13.38 808 807 2450 1950 Surface 4,560 9.62 4,560 3,968 5750 3090 Intm/Liner 3.557 7.00 7,945 7,353 7240 5410 Open Hole 0 0.00 10,750 10,157 0 D Liner Perforation depth Measured depth See WBD feet Various Two Vertical depth See WBD feet Tubing (size, grade, measured and true veNcal depth) - 6.4ppf N80 mdfd See WBD 'ackers and SSSV (type, measured and two vertical depth) See WBD 12. Stimulation of cement squeeze summary: Intervals treated (measured): For PBA, see plug summaries on WBD Treatment descrip6ons including volumes used and final pressure: Prior to well oparatlon: bseeuem to operation: Daly Report of Well Operations Copies of Logs and Surveys Run Printed and Electronic Fracture Stimulation Data 'dA, see plug summaries on WBD Representative Dally Average Proc Gas-Mcf Water -Bbl 0 0 0 0 15. Well Class after work: Explore" Developm 18. We9 Steals after work: GSTOR WINJ WAG my knowledge Service GINJ SUSP SPLUG Iry Number or N/A If C.O. Exempt: Contact Name: Contact Email: slrver�rllEunc.Gan Contact Phone: (337) 8411-5345 Logs Run 1 Tiger Eye 1 BHA 8-22-17 2 Tiger Eye 1 Tbg punch1 8-23-17 2a TIGER EYE 1 TAG1 8-27-17 3 TIGER EYE 1 CIBP1 8-28-17 3a TIGER EYE 1 TAG2 8-28-17 4 Tiger Eye 1 Tbg punch2 8-29-17 5 TIGER EYE 1 CIBP2 8-30-17 5a TIGER EYE 1 TAG3 8-30-17 5b TIGER EYE 1 TAG4 8-30-17 6 Tiger Eye 1 Tbg punch3 8-31-17 7 TIGER EYE 1 CIBP3 9-1-17 8 Tiger Eye 1 Tbg punch4 9-1-17 Tiger Eye Central #1 621' FNL, 833' FWL S19 TBN R14W S.M. Witness 13 3/8 amid to surface NIO�118 b9f4passd4aads aesildlnce"g8filpasorl� hlsulge arb3A[Pe"adMpNMupsa _ dryvldlilawwwwIlm - ad Wds; w161"I ' p1ad81 ASaBulill gwegedii1py gOxdw 7keiletlwals Rikplbab ' dW1165Shs LSlBsnn81bwl60 i ,;f�8t ttdlil B.i% pnpM 111 chemical Injection Nipple at 1800' MD 1711'NDw/1/4" /• h convol lines W surface t09,u_,ggi ivQc jq�t.{sti7 7'n ga/o�i=u1 .0C"THT 6 I Max 63 daprece T7GSmpsi {3( ,,WnpAgpunped60 bbl slurred spa We ( s WM0W/484bx; 1100SX lead 612.0 ppg Yff \\VVYY Is N1J3ms"8I50ppg.lcal rokm@3454as :6384bbls DappbgePd1&*ced W/335ta9---�_ d baryadplug 1632 pd hstlfa2rin andbbtl oil checklbals. Rmxmd2bb6llW. ameo' We 7- T! 19IR IN bilis Conant reMlrn dto sudace r Baker Flex Lok Line w/ ZXP Pitt and top 04,308'N Baker Madel D Prod. Packer set at 5895' MD 5304' TVD Baker Model D Prod. Packer set at 6050' MD 5459' TVD Sllding5leeveat 6078'MD "X" Profile at 6090" MD Model D Prod. Packer @ 6110' MD 5519'TVD. Wire -line set plug in tubing tail at 6137' MD 5546' TVD fell out Punch tbg 0 599'-601'. `p•15 bbls gel pill In annulus 13 3/8" Set cibp @230'. Tag, punch 0200.2'. Mix & pump 40sx "G" ® 15.8 ppg. Cmt to surface. (Cmrd up tree/wellheatl. Tested erratically. @cuNla 2x Blm'up PMM ft." S.6 Jiea b 46WPil1 OK Permits: 212102 " 50 Bbl. Spacer a 126 R rdow w/92.5 JIM. toedm AN C 50.133.20605.00-00 14.5 PP3 rolbw w/ I ee Bfib TeX O 168 PPG w/n OrxWkm Fr -op. Des: &WI9Wn Snuwn Banwepl le drop wbw plug%ugwolN 7,845' KB elevation: 30' (21' AGL) gelklo4opbIbgsub Senpinidbpwewmnlcb..etoplug- Latitude: 60A 34'11.520" 9/8/2017 Longitude: 151A 13' 27.868" Casings Spud, 9/21/2012 Top L 11.21.2012 cut 5' bgl. Rig Released: 12-11.2012 Plate Completion Ria AAO 111 welded. 4/28/13.9/16/13 Punch tbg 0 599'-601'. `p•15 bbls gel pill In annulus 13 3/8" Set cibp @230'. Tag, punch 0200.2'. Mix & pump 40sx "G" ® 15.8 ppg. Cmt to surface. (Cmrd up tree/wellheatl. Tested erratically. @cuNla 2x Blm'up PMM ft." S.6 Jiea b 46WPil1 OK " 50 Bbl. Spacer a 126 R rdow w/92.5 JIM. toedm 29 ppf 14.5 PP3 rolbw w/ I ee Bfib TeX O 168 PPG w/n OrxWkm Bottom &WI9Wn Snuwn Banwepl le drop wbw plug%ugwolN 7,845' mlraWe9-Ibtl to &Void he%eWapy W/zerew dW.eW 7,363 - gelklo4opbIbgsub Senpinidbpwewmnlcb..etoplug- 6140' abamed nap rravemml Ira"cel"Ig pkq drop -!iib M leek I W &5mh-Rip c.d plug. cabtl dbpLLcaneM Rug On 7 Tfebxk buryFl deddhu 185bbblarco"re.sbn&aVwVq 29 PPI mid Pwq ew M n"I mm, 9el/tln& perfo,nud WI Mod Iwne. Top .el aeh.are4ollemmrgenoY reheee mnnbg lod W1ndP& MD .a12XMN.keramuble imd, zoo ebb codlaft.1 mid 10,760'MD Ik,renL GP 414:10 Me am8hoe 10,167'TVD 84 ppf Bottom 141' Conductor Pipe 13 3/8" K55 68 ppf TOP BOTTOM MD 0 808' 5/8.1 L-80 40 ppf Top Bottom MD o' 4,560' NO 0' 3.668' 7"' LINER LA0 29 ppf Top Bottom MD 4,388' 7,845' TVD 3,788' 7,363 - 4 9/1/2017 x & pump 450 sx Prem 'G' ® 15.8pp( ® 4.5 bpm/350 psi. WOC. Test t 1000 psi/30 min 09/03/2017. CHT 5. csgs. Cmt biw cut. Ran tbg. Stopper n Tubing 2 7/8" L -w 6.4 ppf Top Bottom MD e' 6140' TVD W 6547' 7 Tfebxk L40 29 PPI Top Bottom MD Surf 4,388' at 45'. Pump 5 bills 15.8. Cmt to surf w/ 2 bbls pumped. PLUG3- 8/30/2017-08!31/2017 BP ® 5607', Test CHT 2. Tag & punch 0 5591.3 Est inj rate ® 3 bpm 0 1012 psi. Mix & pump 10.2 bbls 15.8 ppg cvmt. Displ w/ H2O ® 884 psi. WOC. Tag TOC ® 5082'. Set clbp 05068'. Test tbg x arm to 1600 psi/30 min. CHT 4. Test cibp - CHT 4b. PLUG 1 - 8/24/2017-08 27,2017 ; 08128/2D17- 08/30/2017 Punch Tubing 5920.22' 'Tagged ® 5818' Est Inj rate ® 3.2 bpm. Mix & !Test tbg to 1700 psi - bled back to pump 15.5 bbls 15.8 ppg amt. 1550psi 0 30 min. OK. CHT 1 Mllpl w/33.87 bbls H2O. Final (Test ann lam psi/30 min. OK. CHT 3 pressure of 861 psi. WOO. 1737.1705'W 88031903' 2035 2054' 2501.2535' 5379-5429 5473-5487 5604 5813 57135783 6938.8990 NjwI4' &Lb SM1"e OEm 4' pPb 9400' glwil&le 8 -IciMYbn pde & eveNOW A4d-9] %ii In 89A PfG ail RI9M- Tasl Wlbumn Sur(ade ldiee b 1800 HI OK - iwrw 20 Bbl F120Ahw0. &x &NBP qg Bble (1a63k)'G' CM w/0.3%CFA 1, 0.5%IMNd- I.ISY,.164s8g4104be w/2.2Aof Ft"h 1.15Y, Dephe"ek-rudli4ibld BbLL 04ehN20 behM Replace w/mtl 114 BbLL D'caanxl&Po w/1-Long WeY6TIOD'-gpe 1&:4S 4. Gdid7/0PI. NOV NOTE for FILE Regarding NordAq Energy LLC PTD 212 102 Tiger Eye Central (41-24) #1 ADL 391104 612' FNL & 833' FWL Sec 19 8n 14w West Cook Inlet Area Wildcat Original Permit and subsequent Sundry permits had the following API no Plate welded on for P&A as noted by Mr. Matt Herrera of the AOGCC, has the incorrect API Nordaq Energy Tiger Eye Central (41-24) Jr 1 BlocWeec 19 On 14w Wildest (W Cook Inlet area) KPe, Naske Ser p.: 212 102 012'FNL&833'FWL Secl98nl4w 1122'FNL&787'FEL Sec248nl6w Daily Operations for P&A Sundry 317-083 —________—__—__—__—___________—__—__—__—__—_--__—__—__—__—__—__—__—__—_____—__—__ August 10,2017____ -Review Sundrq andl�islics.- Travel to west side. August 112017—__— Otfloatl barges—_ -- AAO Rstbts work/on H2O Lines - 2) MW, 1) GE, 2)PESI to Tiger Eye - Got Water Well working w/existing August 12, 2017 pump, Tst'd Pull BPV w/ GE - 750 PSI on Well - Shuttin, Bleed/dn GE Lubricater - No Fluid - Rigldn Same - Release GE & MW Send PESI Crane Hands to Camp - Install 1" Hose to Waste Management Facility & 2" Pipe to Frac Tank PESI "E" Line Unit to Tiger Eye - Will be Ready In Morning Shut(dn for Night --- -----------------------------------------------_----------------------._-- ______ Mobilize Pollard SlicWine & Mast Track to Tiger Eye - PJSM - Rig/up Slickline Drive to Cell Range - Cord Call w/ Larry D, Steve H & Ed Hawkins - Drive back to Tiger Eye Tst Lub to 1500 Psi - OK - Tbg Press = -0- Psi - Fluid 0 Surface - RIH w/ Eq Prong to 3471'- Work to 3498' to Equalize plug - Tbg Press went to 900 Psi - August 13, 2017 POOH -Plug is Equalized - RIH w/2 7/8: GS Pulling Toot to 3495', Latch A -Stop POOH w/ Stop - RIH to3496' - Latch PWoff Plug - POOH - w/ Plug - No element - RIH w/ Braid Brush - POOH Psi now 1000 - RIH w/ GS to 3498 - Latch AD2 Stop - POOH Pk/off Element Inside G Fishing Neck - Tbg Press =1100 Psi - RIH w/2 74/8" Shift Tool to 6081'- Open Xa Sleeve 1150 Psi - R/dn S L - Riglup E- Line- Unable to get below 90'- No Sudden Stops - Shut /dn f/ Night Travel to Tiger Eye - Cut 200' W ire & Re -head - Conf Call - Decide to Bring SL Oper Back - M/u Ass'bty w/ SL W t Bars RKBTbg Press =800 PSI - Unable to fight past 73' RKB - 4 Attempts - - POOH -Tbg = 650 Psi - P/u 2.12" LIB - Tbg = 400 Psi - RIH - Settdn 0 50' fight way to 62'- POOH - No Markings on LIB - R/dn E - August 14, 2017 Line - Travel to Glacier f/ S L Unit Retrieve S L Unit - R/u same & Wait on Slick Line Oper & Methanol Finish R/u S L - Tst Lub 2500 Psi - OK - RIH w/ Bull Plug - SIt/dn ® 55'- Hand Spang - Tbg = 475 Psi - POOH - RIH W/2' Bailer to 23'- Hand Spang 3 times - POOH w/ HYDRATES - r/U Pump to Wing - Pump 25 gal - Tbg Press climbed to 2075 Psi - Lay/dn Lub - Secure well - tbg Press dropped to 1100 Psi - Shutldn for Night Travel to Tiger Eye - Inspect Well - Tbg = 700 Psi (f/ Guage on Arm w/ Arm, Mid, & L. Mstr Valves Closed) Wd/on Meth Corti Cell Plup Meth f/ Plane - Transfer to Test .Pump - %p S L - PT Lub 1500 Psi -OK- Open Swab & Press Tbg to 2000 Psi - RIH w/ DO Bailer to 142, Tag & POOH - Tbg = 680 Psi - Pump 1500 August 15, 2017 Psi in Lub - Open Swab -Press Tbg to 2000 Psi - RIH w/2" x9" Dump Bailedilled w/ Ice -Melt H20 -Meth to 142'w Tool to 159'- POOH - Fluid Dumped - RIH w/ Same&Filled w/ Same to 159'w/ Tool to 211'- Tbg = 1300 Psi - POOH - Fid Dumped - RIH w/ 1.5" Stem w/ 1.75: Stem & 1.75" Star Drill to 216' w/ Tool to 250' POOH - RIH w/ Sme to Tool @ 283'- POOH RIH w/ D Baller w/ Ice/H20/Meth to 283 - POOH - No Shear - Re -run w/added stem & Dumped - POOH R/dn & Secure Tree & Nite Cap - Sht/dn for Night _ - _ -- - -- -- --- ------ --- --- --- ----- -- -- - -- ----------------------------------------------- To --------------------------------------------- To Tiger Eye - Cut Wire & Re -Head - Tbg -1200 Psi - Open Swab - Tbg =1000 Psi - Press/up Tbg to 1200 Psi - RIH w/ 1.75" Star Drill -Tag 0 291' POOH - Coal Call - Press/up Tbg to 2000 Psi - RIH w/ 2' dd Bailer w/ Ball Bottom - w/ Tool firm Surface to 291' Several times to Circulate Fluid - POOH - Tbg = 3200 Psi - RIH August 16, 2017 w/ 2" Star to 294' w/ Tool - POOH Tbg = 3200 Psi - RIH w/ 2.25" Star - Drill to 308' w/ Tool - POOH - Tbg = 2700 Psi - RIH w/1" Chisel to 358'w/ Tool - POOH Tbg = 1750 Psi - RIH w/ 2" Star to 326'w/ Tool POOH - RIH w/ 2"xg" Dump Bailerw/Ice Melt to 326'w/ Tool Fluid Dump POOH - Tbg =1350 Psi - Press/up Tbg to 2000 Psi - Close All Valves, Ly/dn Lub - Srcure Well for Night -------- ------------------------------------------------------------------- Conf Call - Drive to Glacier to P/u Tools f/ Chem Inj Line -Bailer w/ Ice Mlt& Meth to 398 w/rool - POOH - Dump Slurry POOH - Press/up Tbg to 4000 Psi & Pump 8 Gal Melh/dn Inj Line As/per Conf Call - Tbg = 260OPsi - Press/up to 4000 Psi - Tbg bid to 26 Psi - Press/bk/up to 4000 Psi - Tbg bl/bk to 2200 Psi - RIH August 17, 2017 w/1.75 Star Drill to 401'w/ Tool - POOH Bailer w/Ice MltlMeth to 409'w/ Tool -Dump Slurry - POOH - RIH w/ 2" Bailer w/ Bell Bottom to 409 -Make Several Passes to Stir Slurry- POOH - Conf Call - RIH w/ 2"x9" Dump Bailer w/ Slurry to 409 w/ Tool - POOH Slurry Dumped Pump 10 Gall Meth Dn Inj Line - Ly/dn Lub - Bleed Tbg to 800 Psi As/per Conf Call - Secure Well for Night --- —-- —- - - Arrive Tiger Eye - Tbg = 900 Psi (up from 800 Psi last Nile) - Tat Lub - RIH w/ 1.75" Star - 417'- Work to 427' - POOH - RIH w/ 2" DD Bailer w/ Ball - Circulars Slurry (up & Dn) - Conf Call - 1000 Psi on Inj - Press/up to August 18, 2017 3000 Psi Ill broke & Pump 30 Gal Meth - Shutrin (no material f/ guage -will order - RIH W/ W/ Bailer & Dump Meth/Ice Mlt do to 428' - 12381 Move Slick Une Unit & Crane to Glacier -Jockey Hands to Hilcorp Camp & Put/on Plane as/per Pollard & AAO orders Unload 1) Bbl Meth from Plane. --------------------------------------------------------------------------------------- August 19, 2017 Check/on Tiger Location throughout day - All Secure - Tbg = 800 Psi - Loaded & Spread Soil on Road zing of H2O Hose to "La Latrine" --------------------------------------------------------------------------------------- Mac to Tiger Eye - Secure & deserted - Not here w/ E -Line Unit, yet - P/u 1 PEST, 2)AAO, & 1) Hot Rod Tool Hand @ Air Strip - To Camp & to Tiger Eye - R/u E-Une & Gen - P/up Hot Rod & Tesr - OK - Test Lub - OK - RIH w/ Hot Rod Tag T/hydrates 0 435'- Work w/ Hot Rod (tool working good 290 Deg F) to 453.5 @ Conf August 20, 2017 Call 0 16:00 Hrs It was decided that we Work 2) Shifts - Swapped hands w/ town 0 19:30 - Continue Melt Hydrates w/ Hot Rod on E-Une (24' total ft. ice melted 459' depth) POOH. w/ hot rod and add 5'x1.68" weight bar. Test tools on surface. RIH and continue w/ hot rod. Well is jugged tight w/ ice plug. Tubing pressure fluctuates with line displacement. Continue w/ hot rod trying different methods (spudding and/or sitting on ice). Depth = 470'. (35' total ft.) --------------------------------------------------------------------------------------- Corttinued wireline work with hot rod. (depth= 471' /525psi -tubing). Tool set down high after reaching a depth of 483', worked tool back down to 487'. POOH to run dump bailer w/ Ice melt. OOH. Bled gas cap off and then fluidic 200 psi. RIH w/ 10' x 2" OD dump bailer w/ 1.5 gal. of dryIce melt. Bailer set down at 485', dumped ice melt, worked tool to 489', POOH. OOH, bled off gas cap w/ well open, all gas. Shut in well and August 21, 2017 prep hot rod, Pump down CIM 3 gal. RIH w/ hot rod and tag Ice at 501.5'. Continue with hot rod, occassionally tagging sidewall ice. Pump methanol down tubing (1050 psi). POOH w/ hot roti, last tag = 542'. Load up dump bailer w/ ice melt, RIH and tag at 53T, dump salt, work tool, no progress, POOH. MU hot rod, RIH and tag at 540', work tool progressively sitting at one spot for 30-45 min. then spudding up and down. 577' ® 06:00 to 2075 Psi - Lay/dn Lub - Secure well - flog Press dropped to 1100 Psi - Shut/dn fa Night Continue w/ wireline hot rod. POOH w/ hot rod and change out to 2" dump bailer. MU bailer and load w/ log melt. RIH and dump at 580'.POOH. OOH. MU tat rod, RIH, (579')start heating process. (1100 psi tubing). At depth 598', pumped 15 gal. methanol down CIM. Check valve apparently not working (1500pst on CIM). August 22, 2017 Tubing rose to 1350 psi after pumping on CIM. POOH. OOH. RD wireline off tree. Cap tree and RU test pump. PT to 4000 psi. Pressure dropped off to 1720 psi after 15 min. No change on CIM. PT on CIM to check communication. Rehead wireline and add grease tube. MU bailer and load w/ ice melL R1H and dump at 60ly:POOH. OOH. Change out to fat rod. Set down at 605.9. While in the bole PT to 2000 psi and pressure drops off in 2 min. Finished heating at 637'. POOH. OOH. W/O orders. RD hot roti. MU dump bailer w/ ice melt and RIH. Tagged at 632' dumped and worked tool. POOH. MU tool string w/ 1-3/8" x T wt. bar, hot rod, RIH, tag Ice at 634'(1275 psi). Hot roti burned through ice at 662' (1750 August 23, 2017 psi) 0 14:20. Tool set down again at 1067' worked tool for 30 min. and then broke thru and fell free to 2150'. POOH. Conference call to town and MU 2.25" gauge ring and CCL. RIH w/ 2.25" gauge ring to 6205' PBTD. (1950 psi tubing). Logged BHA w/ CCL. POOH. Shut down for night. Hold PJ SM and RU to perforate w/ tubing puncher. PT lubricator to 2500 psi and attend conference call. (1950 psi tubing). RIH w/ 1-11!16" x 2' tubing puncher gun loaded with 10 shots. Correlate gun to BHA CCL August 24, 2017 log on 8-22-17. Log into position and set gun to shoot at 5920'-5922'. Fire gun .(Tubing 1925 psi), no annular change in pressure. 13:30 POOH. RD E -line. Mov a to Camp - Pk/up 3) E -Line Crew & 1) Safety Man to Air Strip Wait/on Haliburton August 25, 2017 Travel to Tiger Eye - Meet Ryan (Nalco's Cementer) - He Stated that They would be ready for our Job 0 +/- 15:00 Hrs But only if they were released (by Glacier) Waitton Haliburton --------------------------------------------------------------------------------------- To Tiger Eye - No Haliburton - Scuttlebutt = Glacier, as/per "Armando" & Conrad Perry will not release Haliburton crew for +/- 4) days Conference Call: Discuss situation & decide that Steve H will call Conrad, Larry D will call Halib urton & Larry Mac will call State Inspector Call Matt Herrera ($1. Insp) & postpone his Flight to Kenai, Call from LarryD: Will start Cmt Job w/ Hallburton Sat, 26th (thanks to Mr Hannigan) - Called August 26, 2017 Inspector back & seUupSat AM Flight to Kenai. Anyhway,after he was contac led, he is going to Glacier first & hoprfully ujs Sun for Tag of Plug #1 Septic Destruction complete. (Thanks to Kevin Reed's Expertise) - Tank was full of Clean H2O w/ 4" Sludge - Tank destroyed w/ top off & bottom tore open - Pumped tp Leach Field, Limed & Bk -Filled (Kevin has separate report) Haliburton was going to Riglup on Well @ d- 20:00 His, but never Showed. Will Start @ 06:00 Sat. Tbg = 1900 Psi --------------------------------------------------------------------------------- Wait/on Halliburton PJSM & R/up on Well - Tbg =1900 Psi Press Tat Surf Lines 3500 Psi - OK -Open Well & Est Inj Rate - 3.2 Bpm M 1960 Psi - 2850 Psi - Mx & Pump 15.5 Bbls Cmt to Slurry Wt of 15.8 Ppg & August 27, 2017 Follow w/ 33.87 Bbis H2O Displacement - Cak:'d T/Cmt = 5850' CIP 09:48 His ShuMn Wellhead Pressure = 3222 Psi Wsh/up & Rig/dn Halliburton - Release Same - They will E -Mail Me Charts & I'll Forward them General Pad Clean/up & Maintenance - Matt Herrera (AGCC Insp) Went Home - Said to Report Tag & PT,etc. to Jim Regg, Sunday. To Tiger Eye - Wait/on PESI E -Line Unit Rig/up E -Line - Tbg = 600 Psi - Bleed /dn to 0 Psi - Press Tat Lub to 1500 Psi - RIH w/ 2.25" Guage Ring / CCL Ass'bly to T/Cmt Tag 0 5618' MD /RKB ( 232' Above August 28, 2017 Calculated) - Log/up & RIH & Re -tag X 5 - POOH R/up to Press Test Tbg w/ Chart Recorder- Unable to get Good Press Test - Full 10 Min @ 1500 Psi & Then would Meed down to 1400 Psi by 15 Min & would continue to Bleed. Press Tested to 2000 Psi & Bled/dn 1900 Psi in 13 Min 1800 Psi in 30 Min. - Decide to Shutldn for Night & Report to AOGCC Mon Morning. To Tiger Eye - E -Line Am 09:15 - Attempt Pump/dn Inj Line - 4000 Psi - Bid/to 2000 Psi - No Pump - R/u PT T/Cmt - Many Attempts - 1700 Psi Bid to 1490 Psi in 30 Min - Accepted. CHT 1. RIH w/ E -Line to Re -tag & August 29, 2017 Brush - Tag T/Cmt @ 5617.5'- Re-tst 1700 Psi f/ 30 Min Bid/to 1480 Psi & Stabilized - OICd - Brush Tbg above Chit - POOH - RIH w/ CIBP - Re -tag Cmt @ Same & Set CIBP @ 5607 - POOH - PT Tbg & CIBP to 1700 Psi - Held solid for 30 Min - Good Test - CHT 2. R/dn Tdt Eq & E -Line - Shut/dn f/ Night - E -Liners have many hours. August 30, 201 ------------ ---------------------------------------------------------------- To Tiger Eye - PJSM - Rig/up to PT 2 718" X 7" Ann - - Test 1600 Psi for 30 Min - Held 1600 Psi - Good Test -CHT 3. R/u E Line - P T Lub 250/ Psi - OK - Conf. Call - M/u 10 Shot 1 9/16" RTG - RIH -Tag CIBP 5607'- Pull Tie/in Log - Re-RIH to CIBP - Log & Locate -Put 200 Psi on Tbg - Part Tbg f/ 5590.7' to 5593'- 7 POOH - R/dn Pollard E -Line R/u Halliburton to Pump(dn Tbg & Take Returns f/ 2 7/8" Ann - PT Surface Lines - Est Inj Rate of 3 BPM 0 1012 Psi - 6 bbis in Caught Circ - Pump 10 Bbls H2O - Mix & Pump 10.2 BBIs Cml to a SlurryWt of 15.B Ppg & Disp w/ 2 Bpm 0 884 Psi w/ 30.7 Bbis H2O - CIP = 14:18 Hrs - Caldd T/Cmt = 5298'- Length of Plug = 292.26 - Rig/dn Haliburton General Clean/up & Maintainance of Pad ---------------------------------------------------------------------------- To Tiger Eye - Worklon Tiger Eye #2 Conductor Casing - Whilst W OC & Conf Call 0 08:00 to 08:30 - Discuss new plan of Action for Tiger Eye #1 - Cuttoff #2 Conductor 0 5.5' BGL & Fill w/ Pad Gravel, Weld/install Top Metal Plate E-Une Rigged/up Whilst WOC - RIH w GR Ass'bly & Tag T/Cmt @ 5084.2' - August 31, 2017 Pull Tiefin Log & Tag T/Cmt 5081.2 X 4 - POOH - R/u & PT 2 7/8" X 7" Ann to 1600 Psi for 30 Min w/ Chart - CHT 4 RIH w/ Brush Ass'bly - Re -Tag T/Cmt 0 5082' - Pull Tie/in Log & Brush/Otag f/ 15 Min POOH - M/u 2.16" CIBP - RIH - Log Into Position & Set CIBP ® 5067.6'- POOH - R/u to PT CIBP & Test Same to 1600 Psi for 30 Mln & Charted - Good Test - CHT 4b Rig/dn Shut/dn for Night TGSM - R/u to PT Chem Inj Line - Conf Call - Chem Inj Line failed Tat & is Taking Fluid. 7" x 9 5/8" annulus test- PT HI Press & Lo Press lines - Staged Pumps 110.5 Bpm to 5 Bpm - 0 5 Bpm Max Press = 240 Psi - September 1, 2017 135 Bbls Fluid Pumped Total. R/u & Hand/pump w/ Pollard 4) Gal HES Chit Down Chem Inj Line w/3000 Psi on it R/u E -Line PT Lub - RIH w/ 4" X 1.4,V'00 Guns & CCL - Stop ® 650' PUH to 580'- RBIH & Standby for Orders t/ Town - Receive Orders to Continue - Log into Position & Fire Shots f/ 598.7'b 601' POOH - Rig/dn - Shut/dn f/ Night Secure Well & Location --------------------------------------------------------------------- to Tiger Eye - R/u to PT Chem Inj Line - Will not test - Will give Special Cmt another 24 Hire - R/u E Line - PT Lub - RIH w/ 4" X 1.44' Setting Tool & CIBP & CCL- Conf Call - Log Into Position & Set CIBP 0 230' PUH to 185; RBIH & Tag CIBT At 230'- POOH - Mhi 10 Shot 19/161 RTG - RIH w/ Pert Ass'bly - Tag CIBP rd 230' - September 2, 2017 Log Into Position & perr'd from 200' to 2023- POOH & Rig/dn- R/u HES - Circ 2 7/8" Ann Thm Penis Shot 20D'- 202.2 to Clear Gel - Mixed & Pumped 450 Sx Prem "G" 0 15.8 Ppg - ® 4.5 Bpm & 315 Psi do 9 5/8" X T' Ann - Shutrin @250 Psi - Pumped 1 Bbl H2O to Clean Wellbore Pumped/dn 2 7/8" X 7" Ann 40 Sx Prem "G" @ 15.8 Ppg - 2 Bbls good Cmt to Surface - CIP = 12.00 His Prep Ped f/ Move - Start Bk -fill os Conductor on #2 - Briddn Pipeline to H2O Well ----------------- - ------------------------------------- To Tiger Eye - PJSM - R/u to PT Chem Inj Line - Good Tat 1700 Psi f/ 30 Min - Conf Call - CHT 6. Whilst WOO, R/u To Tag TOC - PT Lub RIH - Tag TOC 0 T/Swab Valve & Pollard XO - CEMENT TO SURFACE & Tree Cmt'd / up - R/dn Lub, etc. R/u to Ann's whilst move Crane to H2O Well - Pumplinto 7" X 9516: Ann - September 3, 2017 NO Press - 2 7/8" X 7" Ann Jumps/up to as Hi as 2500, R/u HES on 7" X 9 5/8" Ann - Use Pump System that will only buck Press to 135 Psi & then brought HT 400's on - results: w/ 4.5 Bbls pumped - Press = 1012 Psi (Equals +/-156' in Ann - CHT 5. Pollard's Air Pump just wasn't filling the Void - HES Strongly recommended to not Re-tst 2 7/8" X 7" Ann till Sunday AM as Cmt in Tree is Very Green & to use Air Pump -------------- _—_For Tests_----_ To Tiger Eye - PJSM - R/u to PT 2 7/8" Tbg to 1500 Psi ff 30 Min w/ Pollard - Test Failed - MultipeTimes. R/u to PT 2 7/8" X 7' Ann to 1500 Psi f/ 30 Min - Test Failed Multiple Times - Communication Established between Tbg & Ann Conf Call - Decide that Prior Day's PT by HES of 7" X 9 5/8" Ann to (1000 September 4, 2017 Psi f/31 Min) good w/ 10°/, Bleed Test W HES (w/ AAO's Chart -3). Calls to Larry Driskill from AAO/Pollard/HES During Testing: 2 7/8" 30 Min, 2 7/8" 30 Min, 2 7/8"X 7" 1.5 Hr, 2 718" 1.5 Hr. Nipple/dnSwab Valve from Tree - "SOLID CEMENT" INC Wing - Snapshots of Tgest Charts E -Mailed to -----------------------------------------------------------------------'------- Larry & Steve NOTE: All Testing w/ HES with no more than 1 % of Bbl of fluid pumped with each test ------ To Tiger Eye - R/u to PT 2 7/8" Tbg w/ Pollard - Would/not hold Test - HES told to PT 2 7/8'X 7" to 3000 Psi & Chart for 1.5 His It Bled to +/- 500 Psi & never Stabilized - Conf Call - PT Tree to Btm Master - OK - SteveHennigan Located Mr Quick w/ AOGCC & Presented Our Position Eloquently & He Gave us the "go September 5, 2017 ahead" w/ Plan to Cutfoff Tree - Hoorah! - Remove Wing Valve V Tree & Ready for Crane Hookup R/dn Pollard E -Line & HES - General Clean/up Around WH Area - Excavate Around Tree, Except Crane Area - Pull Cellar w/ Crane & Loader - Continue Excavation Around Tree/Welihead - Ready for the Torch - Shut/dn for Night To Tiger Eye - PJSM - Whilst Enlarging Space Around Tree, Cut Water Well Cog T BGL - Cut Wellhead Off using Torch - Supported Same w/ Pollard Crane & Recovered from Pit. 2 7/8" Tbg = Solid Cmt, 2 718" September 6, 2017 OOOOOox 7" Ann = Solid Cmt - 7" X 9 5/6" = Fluid - Tbg = T'= Collar (making access to Ann very Chmped for T/job) - Fill Water Well w/ Plug Product & also on outside Csg below Top Soil & Gravel Meet Plane from Kenai w/ Supplies - Barge postponed till Wed AM - Ready for AOGCC Inspection - Have Photos ---------------. --. --.. --. —.-----.---.----..----------------------------------------.. Stormy Night - Clear 4) Trees off/road to Tiger Eye - Location Flooded - Wellhead Pit Sloughed/in & had 3112 Ft:Rainwater Above Csg Stump - Pump Water & Build Berm Around Pit Run Coiled 1/2" Copper Tubing Dn September7, 2017 7" 9 5/8" Arm - Solid Stop ® 45' - ftfu HES'& to Copper Tubing - Boost 1) Bbt H2O® 20 Psi - Mix & Pump 5) Bbls Chit to 15.8 Ppg - Pump @ 56 Psi - Cmt to Surface after 2) Bbls Pumped @ 15:30 Hrs Rig/dn HES & ........... AAO- Shuf/dn for Night............ To Tiger Eye - Cmt in 7" X 9 5/8" Ann Dropped (or drooped) Up to 21" on only 1/2 of the Circle "A Crescenr' thu the night. Called it in & took Photos - Walt/on Mr Matt Herrera of AOGCC's Arrival Mr Herrera OK'd September 8, 2017 Plug w/ addition of 21" Patch Job - Escorted Said Inspector to Glacier Property, Where He Blessed Similar Icons - Escorted Mr Herrera to Camp, where He caught a Plane to Kenai (along w/ 2) HES Hands) Began Clean/up of Tanks, & Bk(filling & Taxiing of WBI Trailers f/ Barge Landing to Location - Planning on 2) Barges Sat, Sept 9th ® 06:00 & 17:00 Hrs --------------------------------------------------------------------------------------- September 9, 2017 Load Trailers w/Driver & Haul Same to Barge Landing & General Cleanup of Tiger Eye Pad. All Looks Neat 's ...--._.----------------------------------- w/ the Exception of CIE / Glacier / HES Matter Stored on Somali ---------------------------------------.. —.. Barge #1 - Loaded w/ W bi Trailers Listed on Last Report w/ All AAO Eq & Rentals Inc. Case Loader Barge#2 September 10, 2017 - Loaded w/ WBI Trlr # 38.203 w/ HES Misc, 1) HES Pump Unit, 1) Cmt Pod Unit, 1) HES P/u, 1) Pollar E - Line Unit, 1) Pollard P/u, & 1) WBI Winch Truck - Shoved/off @ 19:50 His Chart Index Descriptions Sa CHT 1 5b CHT 2 5c CHT 3 5d CHT 4 5dx CHT4b 5e CHT 5 5f CHT 6 5g CHT 7 { f � t � 7 j I P5 f ( //,1'7- Z- l� / .I 7b'4 - - CA- r,T� 2 / S r,T� ���73 W v „L Halco and other Reports 6a PJR - V1 - Tiger Eye Central 1 Tubing Job #1 - Perfs 6b PJR - V1- Tiger Eye Central 1 Tubing Job #2 Balanced plug deep 6c PJR - V1- Tiger Eye Central 1 Viscous Pill and Surface Cement 6d PJR - V1- Tiger Eye Central 1 Viscous Pill, OA Abandonment and Surface Cement 6e PJR - VS - Tiger Eye Central 1 Top Out 7 Nordaq Tiger Eye Septic Closure Record Drawing iCem Service NORDAQ ENERGY INC - EBUS United States of America For: Pete Dickinson Date: Wednesday, September 13'" 2017 Tubing Plug #1 Job Date: Saturday, August 26", 2017 Sincerely, Savannah Afoa �..iahil 1yt111i:C Warllirlg Disclaimer Although the information contained in this report is based on sound engineering practices, the copyright owner(s) does (do) not accept any responsibilitywhatsoever, in negligence or otherwise, for any loss or damage arising from the possession or use of the report whether in terms of correctness or otherwise. The application, therefore, by the user of this report or any part thereof, is solely at the user's own risk. in-iii.ations Ui Llabiliiy Except as expressly set forth herein, there are no representations or warranties by Halliburton, express or implied, including implied warranties of merchantability and/or fitness for a particular purpose. In no event will Halliburton or its suppliers be liable for consequential, incidental, special, punitive or exemplary damages (including, without limitation, loss of data, profits, use of hardware, or software). Customer accepts full responsibility for any investment made based on results from the Software. Any interpretations, analyses or modeling of any data, including, but not limited to Customer data, and any recommendation or decisions based upon such interpretations, analyses or modeling are opinions based upon inferences from measurements and empirical relationships and assumptions, which inferences and assumptions are not infallible, and with respect to which professional may differ. Accordingly, Halliburton cannot and does not warrant the accuracy, correctness or completeness of any such interpretation, recommendation, modeling or other products of the Software Product. As such, any interpretation, recommendation or modeling resulting from the Software for the purpose of any drilling, well treatment, production or financial decision will be at the sole risk of Customer. Under no circumstances will Halliburton or its suppliers be liable for any damages. HALLIBURTON Table of Contents Customer: Nordaq Tiger Eye 1 Tubing Plug #1 iCem Service (v. 6.2.393) Page 3 Created: Wednesday, May 10", 2017 HALLIBURTON Customer: Nordaq Tiger Eye 1 Tubing Plug R1 Mr. Dickinson, Halliburton appreciates the opportunity to perforin the cementing services on Tiger Eye Central 1. A pre -job safety meeting was held where details of die job were discussed and potential safety hazards were reviewed. At 07:00 on August 251b, Halliburton cement arrived on location and had a pre -job safety meeting. Following the meeting the crew began preparing the mix water for the cement job. At 08:59, the cement unit came online for a low pressure test to 337 psi and a high pressure test to 3717 psi. Both tests were successful so pressure was bled off. At 09:10, HAL broke circulation at 2300 psi, after which the pressure fell to 1900 psi at 3 bpm. An injection test was then performed with 20.7 bbl at 3 bpm and 1900 psi, and 6 bbl at 0.7 psi bpm. Cement was then pumped for a total of 36.5 bbl at 15.8 ppg and 3.1 bpm, followed by 33.8 bbl of water displacement pumped at 3 bpm. Displacement pressure was 3071 psi and the well was shut in at 3222 psi. Cement was in place at 09:52, and HAL left location at 11:00 Halliburton maintains a continuous quality improvement process and appreciates any comments or suggestions that you may have. Halliburton Energy Services again thanks you for the opportunity to perform services work on this well. We hope to be your solutions provider for future projects. Thank You, Savannah Afoa Technical Professional — Cement and Casing Equipment 6900 Arctic Blvd. Anchorage, AK 99518 Email: avan aliafeallltallibut(,n.com Mobile: +1907-223-9423 Office: +1907-273-3568 "I)eVikn and p ejivev Dependable Harlem Tailored to r4/inimiZe Rieh eurd Ma-viurite Poidu (ion (v. 4.2.393) Created: Wednesday, May 10s, 2017 Page 4 H ALLI B U RTO N Customer: Nordaq Tiger Eye 1 Tubing Plug ##1 2.1 Job Event Log Type Seq. Activity Graph label Date Time Source PS Pump DH Comb Comb No. Press Density Pump PumpTotai Rate (Psi) (PPo) lhbJ/min) (661) Event 1 Start Job Start Job 8/26/2017 08:58:45 COMS -1.00 8.58 0.00 0.00 Comments Event 2 Pressure Test Pressure Test 8/26/2017 08:59:55 USER 317.00 8.58 0.00 0.20 Pressure testing low pt 337 psi, High pt 3717 Injection test well broke over at 2300 psi, dropped to Event 3 Injection Test Injection Test 8/26/2017 09:10:15 USER 1918.00 8.19 0.00 0.30 1900 psi 3 bpm, pumped 20.7 b1bl3 bpm 1900 psi, 6 bbl Injection at.7 bpm, Event 4 Pump Cement Pump Cement 8/26/2017 09:31:36 USER 855.00 15.49 1.90 29.10 Pumped 15.4 bb115.9 ppg - cement 3 bpm, 938 psi Pumped 33.8 bbl fresh water displacement, 3 bpm Event 5 Pump Displacement Pump Displacement 8/26/2017 09:36:34 USER 700.00 13.62 3.20 44.40 3071 psi, shut in well with 3222 psi, cement in place 09:52 Page 5 Event 6 Shutdown Shutdown 8/26/2017 09:47:18 USER 3264.00 8.30 3.20 78.50 Event 7 End Job End Job 8/26/2017 09:51:08 COMS 8.00 8.19 0.00 7890 iCem Service (v. 4.2.393) Created: Wednesday, May le, 2017 HALLISURTON rt,uUh:tta+ 3.1 Job Chart Q❑ Customer: Nordaq Tiger Eye 1 Tubing Plug #1 Cusorn Resulm tOrAm BMW hA MAW OR" Y k-1347 ff 4zslam rh 4J 0. iCem Service (v. 4.2.393) Page 6 Created: Wednesday, May 101°, 2027 iCem Service NORDAQ ENERGY INC - EBUS United States of America For: Pete Dickinson Date: Tuesday, August 29s, 2017 Plug 42 Job Date: Wednesday, August 30h, 2017 Sincerely, Savannah Afoa Warning Disclaimer Although the information contained in this report is based on sound engineering practices, the copyright owner(s) does (do) not accept any responsibility whatsoever, in negligence or otherwise, for any loss or damage arising from the possession or use of the report whether in terms of correctness or otherwise. The application, therefore, by the user of this report or any part thereof, is solely at the user's own risk. I in-litarions cit IJabiIity Except as expressly set forth herein, there are no representations or warranties by Halliburton, express or implied, including implied warranties of merchantability and/or fitness for a particular purpose. In no event will Halliburton or its suppliers be liable for consequential, incidental, special, punitive or exemplary damages (including, without limitation, loss of data, profits, use of hardware, or software). Customer accepts full responsibility for any investment made based on results from the Software. Any interpretations, analyses or modeling of any data, including, but not limited to Customer data, and any recommendation or decisions based upon such interpretations, analyses or modeling are opinions based upon inferences from measurements and empirical relationships and assumptions, which inferences and assumptions are not infallible, and with respect to which professional may differ. Accordingly, Halliburton cannot and does not warrant the accuracy, correctness or completeness of any such interpretation, recommendation, modeling or other products of the Software Product. As such, any interpretation, recommendation or modeling resulting from the Software for the purpose of any drilling, well treatment, production or financial decision will be at the sole risk of Customer. Under no circumstances will Halliburton or its suppliers be liable for any damages. HALLIBURTON Table oFC'orteuts Customer: Nordaq Tiger Eye Central 1 Tubing Plug k2 Page 3 iCenl' Service (v. 4.2.393) Created: Wednesday, May IOM, 2017 HALLIBURTON Customer: Nordaq Tiger Eye Central 1 Tubing Plug #2 Mr, Dickinson, Halliburton appreciates the opportunity to perform the cementing services on Tiger Eye Central 1. On August 29t°, a prejob safety meeting was held where details of the job were discussed and potential safety hazards were reviewed. At 07:30 the Halliburton cement crew began loading the bulk truck with cement for the second cement plug. Rig -up began at 11:00, at which time the mix water was prepared. The cement job began at 13:10 with a low pressure test to 550 psi to test the iron fallowing by a high pressure test to 3070 psi. Both tests were successful and pressure was filed off. An injection test was them performed, after which cement was batch mixed. At 13:52 the cement was ready and HAL began pumping cement down hole. The total volume pumped was 10.2 bbl at 2 bpm with 331 psi. Mix water used was 278 gallons. Cement was followed with 30.7 bbi of displacement pumped at 2 bpm. Job pressure was 884 psi. The job was completed at 14:17. Halliburton maintains a continuous quality improvement process and appreciates any comments or suggestions that you may have, Halliburton Energy Services again thanks you for the opportunity to perform services work on this well. We hope to be your solutions provider for future projects. Thank You, Savannah Afoa Technical Professional — Cement and Casing Equipment 6900 Arctic Blvd. Anchorage, AK 99518 Email: coil, Mobile: +1907-223-9423 Office: +1907-273-3568 Design and Deliver Depeilrlable Bat'rieis l ailored t(, AYNnimice Risk and ,Newhaize Produerinn" Page 4 (v. 4.2.393) Created: Wednesday, May 101b, 2017 HALLIBURTON Customer: Nordaq Tiger Eye Central 1 Tubing Plug #2 I! i(' 1( Tii)li loi, :i, 2.1 Job Event Log Type Seq. Activity Graph label Date Time Source PS Pump DH, Comb Comb Comments No. Press Density Pump Pump Total Rate (PO (PPG) Obl/min) (6611 Event 1 Start Job Start lob 8/29/2017 13:10:36 COMS 5.00 8.53 0.D0 0.00 Event 2 Pressure Up Pressure Up 8/29/2017 13:24:05 USER 19.00 8.46 0.30 0.10 Pressure testing iron, Low Pt 550 High Pt 3070 psi, Injection test, pumped 10 bbl injection test, .5 bpm 177 psi, 1 bpm 249 Event 3 Injection Rate Injection Rate 8/29/2017 13:37:14 USER 143.00 8.56 0.40 0.20 psi, 1.5 bpm 435 psi, 2 bpm 650 psi, 2.5 bpm 848 psi, 3 bpm 1012 psi, Caught returns and 6.3 bbl pumped, Event 4 Shutdown Shutdown 8/29/2017 13:43:37 USER 320.00 8.27 0.00 10.20 Event 5 Other Batching Cement 8/29/2017 13:46:51 USER 288.00 8.10 0.00 10.20 Gatch 15,8 ppg cement, Mixed and pumped 10.2 bbl Event 6 Pump Cement Pump Cement 8/29/2017 13:51:40 USER 346.00 8.15 1.00 1030 15.8 ppg cement, 2 bpm, 331 psi, 278 gallons mix water used Pumped 30.7 bbl Event 7 Pump Displacement Pump Displacement 8/29/2017 13:58:26 USER 254.00 11.77 1.90 21.50 displacement, 2 bpm, 894psi Event 8 Shutdown Shutdown 8/29/2017 14:14:37 USER 791.00 8.27 0.70 52.30 Event 9 End Job EndJob 8/29/2017 14:17:59 COMS 99.00 8.23 0.00 52.30 Page 5 iCem'" Service (v. 4.2.393) Created: Wednesday, May le, 2017 HALLIBURTON ctachfnc. 3.1 Tab Chart Customer: Nordaq Tiger Eye Central STubing Plug#2 Custom Results o a s u u a u I I I I I I 1 3 1 I I I I I I I I 6 I I Page 6 MM ,33820 13*0 13= YMB 141bW kui-1 a YB1701i R.A8.90:•7.8 Y. R.r,.;, q?s<IFS% Ct:errsty Ccrh Pwry Tsk PE6Tr` Ccr,DFunp ¢!N lClii: ICem Service (v. 4.2.393) Created: Wednesday, May 10i°, 2017 iCem Service NORDAQ ENERGY INC - EBUS United States of America For: Pete Dickinson Date: Wednesday, September 13`h 2017 Surface Plug Job Date: Friday, September 1", 2017 Sincerely, Savannah Afoa .'s1`lf '�uLce Warning Disclaimer Although the information contained in this report is based on sound engineering practices, the copyright owner(s) does (do) not accept any responsibility whatsoever, in negligence or otherwise, for any loss or damage arising from the possession or use of the report whether in terms of correctness or otherwise. The application, therefore, by the user of this report or any part thereof, is solely at the user's own risk. Limitations of Liability Except as expressly set forth herein, there are no representations or warranties by Halliburton, express or implied, including implied warranties of merchantability and/or fitness for a particular purpose. In no event will Halliburton or its suppliers be liable for consequential, incidental, special, punitive or exemplary damages (including, without limitation, loss of data, profits, use of hardware, or software). Customer accepts full responsibility for any investment made based on results from the Software. Any interpretations, analyses or modeling of any data, including, but not limited to Customer data, and any recommendation or decisions based upon such interpretations, analyses or modeling are opinions based upon inferences from measurements and empirical relationships and assumptions, which inferences and assumptions are not infallible, and with respect to which professional may differ. Accordingly, Halliburton cannot and does not warrant the accuracy, correctness or completeness of any such interpretation, recommendation, modeling or other products of the Software Product. As such, any interpretation, recommendation or modeling resulting from the Software for the purpose of any drilling, well treatment, production or financial decision will be at the sole risk of Customer. Under no circumstances will Halliburton or its suppliers be liable for any damages. HALLIBURTON TJb[C0|(0A|C8L� |/) F/A:uiircSumm:rv------.-----.—^~----' 1.0 Rcu|-TimL .1vhSun1nm/y............. ..... —...—^—`—'—' 2./ Job Event Log ..................................... .............................. ........ ....... ^~~.... ~~~^ !V 6kodxxuos..... -----.......................... ...... I ... ......... ' uViscous Pill Job Chart ..................... ..................... .............. ....... ._... ..... ..... ~~.... Customer:Nmclaq Tiger Eye 1Surface Plug 4 _..... ,.......... .................. ........... ..... —.6 ... .... —.... .7 C8no'S8rviC9 (v. 4.2.393) Created: Wednesday, May m~,mo HAL.L,IBUATON Mr. Dickinson, Customer: Nordaq Tiger Eye 1 Surface Plug Halliburton appreciates the opportunity to perform the cementing services on Tiger Eye Central 1. A pre -job safety meeting was held where details of the job were discussed and potential safety hazards were reviewed. At 06:00 on September 1" the Halliburton cement arrived on location and had a pre job safety meeting. The pumps were primed at 06:30, after which 15 bbl of a viscous pill was prehydrated. Once the pill was ready, Halliburton broke circulation with 10 bbl of fresh water and pumped the viscous pill at 3 bpm, 125 psi. 0.9 bbl of water displacement was pumped after the pill to balance, and the cement unit was shut down and waited for Pollard to set a bridge plug and perforate tubing. Halliburton circulated the tubing and annulus at 10:20 to get rid of excess viscous pill. The 45 bbls of fluid from the slop tank were then injected down hole followed by 10 bbl of fresh water. At 10:48, the cement unit pumped 93.2 bbl/ 450 sks of 15.8 ppg cement down the OA to bring cement to surface. The cement was pumped at 4.5 bpm and job pressure was 315 psi. Once cement was displaced with 0.75 bbl of fresh water per the customer, the well was shut in with 215 psi and Halliburton swapped to pump down the tubing. A total of 8.3 bbl/40 sks of cement was pumped down the tubing and out of the perforations to fill the 2-718" x 7" annulus to surface. 2 bbls of cement returned to surface. The job was completed at 12:00 and the crew left location at 14:00. Halliburton maintains a continuous quality improvement process and appreciates any comments or suggestions that you may have. Halliburton Energy Services again thanks you for the opportunity to perform services work on this well. We hope to be your solutions provider for future projects. Thank You, Savannah Afoa Technical Professional —Cement and Casing Equipment 6900 Arctic Blvd. Anchorage, AK 99518 Email: savannah.nfoafii.•hallibunon.com Mobile: +1907-223-9423 Office: +1907-273-3568 1'0^ign and Deliver Dependahlr Rairiers Tailored fa Minimize RiA, rnrd .1&crimize Prnduefien" Page4 ICrsrn S,ar"ice (v. 4.2.393) Created: Wednesday, May 10°, 2017 HALLIBURTON Job Event Log Customer: Nordaq Tiger Eye I Surface Plug Type Seq. No. Activity Graph Label Date Time source Ps Pump Comb Pumpstg Recirc 9/1/2017 07:46:40 USER Event 7 Circulate Well Circulate tubing and Press Pump Tot Density annulus 9/1/2017 10:20:29 USER Event 8 Rate Inject 9/1/2017 10:29:40 USER Event 9 Pump Cement Pump Cement 9/1/2017 (Psi) (bbUminJ (bbl) (PP9) Event 1 Start lob StartJob 9/1/2017 07:32:55 COM6 31.00 0.00 0.00 8.42 Event 2 Break Circulation Break Circulation 9/1/2017 07:33:04 USER 34.00 0.30 0.00 8.42 Event 3 Pump Gel Pill Pump Gel Pill 9/1/2017 07:39:05 USER 135.00 3.20 0.00 0.04 Event 4 Pump Displacement Pump Displacement 9/1/2017 07:44:34 USER 99.00 3.20 17.60 0.03 Event 5 Other Shutdown 9/1/2017 07:45:35 USER Event 6 Clean Lines Wart on Pollard 9/1/2017 07:46:40 USER Event 7 Circulate Well Circulate tubing and 0.00 8.42 annulus 9/1/2017 10:20:29 USER Event 8 Inject Down Annulus Inject 9/1/2017 10:29:40 USER Event 9 Pump Cement Pump Cement 9/1/2017 10:48:37 USER Page 5 20.00 0.00 1.00 0.03 17.00 0.00 1.00 0.03 17.00 0.00 0.20 8.43 4.00 0.00 0.00 8.42 2.00 0.00 0,00 8,34 ICem Service (v. 4.2.393) Created: Wednesday, May le, 2017 Comments Break circulation with SO bbis of fresh water 3 bpm 135 psi Pump 15 bbls of gel pill 3 bpm 125 psi Pump 0.9 bbls of fresh water to balance.3 bpm 97psi Shut down pumps and check flow back to displacement tank. No flaw back pill is balanced. Clean pumps and wait on Pollard to set bridge plug and pert holes Circulate tubing and annulus to surface through perfs at 200 to 202.2' to clear gel Inject 45 bbls from slop tank down annulus followed by 10 bbls fresh water Pump down 7" %9.625 annulus - 93.2 bbls cement at 15.8 ppg, 450 sacks, 1.163 cf/sk, 5.085 gal/sk. Final pump pressure was HALLIBURTON Customer: Nordaq Tiger Eye 1 Surface Plug 315psi at 4.5 bpm, shut in at 2so psi. As per customers request Event 10 Shutdown End O.A. down squeeze 9/1/2017 11:18:37 USER 457.00 3.50 89.70 1.36 chased cement with 0.75 bbl of water to clear well head. Pump through Perls In 2.875" X 7" to surface - 8.3 bbls cement at 15.8ppg, 40 sacks, 1.163 cf/sk, 5.085 Event 11 Pump Cement Pump Cement 9/1/2017 11:32:39 USER 13.00 0.90 1.30 15.92 gal/sk. 2 bbls good cement to surface. As per customers request chased with 0.75 bbl of water to clearwell head Recirc density charted on Event 12 Endlob End Job 9/1/2017 12:05:00 COME 20.00 2.00 15.90 0.16 chart due erratic readings on HPVr caused from low back pressures. iCern Service Page (v. 4.2.393) g Created: Wednesday, May 10°, 2017 HALLIBURTON 3.1 V Is000a Pill Job Chat Nordaq Tiger eye 91 PTA L Customer: Nordaq Tiger Eye 1 Surface Plug C� 1 I I 1 I I 1 i enaw armAa Na`6p O7Aafi0 a7�iL'AD 9743N7 RAM a *Aa 9P -!W 3�IE1a17 a iCem Service Page 7 (v. 4.2.393) Created: Wednesday, May le, 2017 HALLIBURTON 3.2 Cement Job Chart I t 1 I I I } 1 1 1 1 Page a Nordac. Tiger eyeft PTA Customer: Nordaq Tiger Eye 1 Surface Plug a L lozz 1Qdaitl Wild� _— —. 14IM7 !1:13M >73aW ;LJ6YJ SlIK 9MG171: ;✓r31 -m; 'r>:vma a:ss!r::. :.cvd>,vro2a:; cSU�^: -a*: S3h, ural: rs:,r•:•3;^sYS�' iCem Service (v. 4.2.393) Created: Wednesday, May 10'i 2017 iCem Service NORDAQ ENERGY INC - EBUS United States of America For: Pete Dickinson Date: Wednesday, September 13" 2017 Surface Plug Job Date: Friday, September 1", 2017 Sincerely, Savannah Afoa Warnint; Disclaimer Although the information contained in this report is based on sound engineering practices, the copyright owner(s) does (do) not accept any responsibility whatsoever, in negligence or otherwise, for any loss or damage arising from the possession or use of the report whether in terms of correctness or otherwise. The application, therefore, by the user of this report or any part thereof, is solely at the user's own risk. Limitations of Liability Except as expressly set forth herein, there are no representations or warranties by Halliburton, express or implied, including implied warranties of merchantability and/or fitness for a particular purpose. in no event will Halliburton or its suppliers be liable for consequential, incidental, special, punitive or exemplary damages (including, without limitation, loss of data, profits, use of hardware, or software). Customer accepts full responsibility for any investment made based on results from the Software. Any interpretations, analyses or modeling of any data, including, but not limited to Customer data, and any recommendation or decisions based upon such interpretations, analyses or modeling are opinions based upon inferences from measurements and empirical relationships and assumptions, which inferences and assumptions are not infallible, and with respect to which professional may differ. Accordingly, Halliburton cannot and does not warrant the accuracy, correctness or completeness of any such interpretation, recommendation, modeling or other products of the Software Product. As such, any interpretation, recommendation or modeling resulting from the Software for the purpose of any drilling, well treatment, production or financial decision will be at the sole risk of Customer. Under no circumstances will Halliburton or its suppliers be liable for any damages. HALLIBURTION Table of(olitents Customer: Norclaq Tiger Eye 1 Surface Plug A F.,icaltive sullinlary .... 4 10 Real -Tillie .IQb C311111111LIJ, ............. - 5 2.1 Job Event Log.... ..................... ........ .... .. ... .. ...... ... .. - ... . ... ... .. ... ... ..... . . * ...... .... .... .... ..... .. .... . . .......... .......... 5 3.0 Allachnients - .... .. .. .. ... I ...... I ......... 7 3.1 Viscous Pill Job Chart ....... .................. .. ... ............ ... ... . . ....... .. . ......... . ..... . ........... ..... .. 4 .. ... .. 4 ... . ...... — ......... * . ........ 44*,4** ... ..... — ............... 7 3.2 Cement Job Chart ................... . . .. . .. ... . .... .. ... . . ....... . .. .... .. .... ... .. . ** .......... ...... — ............... - . ......... —, — ... * ... 8 Page 3 iCem'Service (v. 4.2.393) Created: Wednesday, May 101h, 2017 MALLIBURTON Mr. Dickinson, Customer: Nordaq Tiger Eye 1 Surface Plug Halliburton appreciates the opportunity to perforin the cementing services on Tiger Eye Central 1. A pre -job safety meeting was held where details of the job were discussed and potential safety hazards were reviewed. At 06:00 on September I" the Halliburton cement arrived on location and had a pre job safety meeting. The pumps were primed at 06:30, after which 15 bbl of a viscous pill was prehydrated. Once the pill was ready, Halliburton broke circulation with 10 bbl of fresh water and pumped the viscous pill at 3 bpm, 125 psi. 09 bbl of water displacement was pumped after the pill to balance, and the cement unit was shut down and waited for Pollard to set a bridge plug and perforate tubing. After circulating the tubing through the perforations to get rid of excess viscous pill, HAL switched to pump cement down the 7" x 9- 5/8" OA. The 45 bbls of fluid from the slop tank were then injected down hole followed by 10 bbl of fresh water. At 10:48, the cement unit pumped 93.2 bbl/ 450 sks of 15.8 ppg cement down the OA to bring cement to surface. The cement was pumped at 4.5 bpm and job pressure was 315 psi. Once cement was displaced with 0.75 bbl of fresh water per the customer, the well was shut in with 215 psi and Halliburton swapped to pump down the tubing. A total of 8.3 bbl/40 sks of cement was pumped down the tubing and out of the perforations to fill the 2-7/8" x 7" annulus to surface. 2 bbis of cement returned to surface. The job was completed at 12:00 and the crew left location at 14:00. Halliburton maintains a continuous quality improvement process and appreciates any comments or suggestions that you may have. Halliburton Energy Services again thanks you for the opportunity to perform services work on this well. We hope to be your solutions provider for future projects. Thank You, Savannah Alba Technical Professional — Cement and Casing Equipment 6900 Arctic Blvd. Anchorage, AK 99518 Email: savannah afoauiuhollibunon.corn Mobile: +1 907-223-9423 Office: +1907-273-3568 "Design acrd Deliver Dependable Harriers 1,11i6med la Mioinwe rii.sh and 'ifoximi;e t5ndncrinn Page 4 1(_P'!1! SP'Vi C:(' (v. 4.2.393) Created: Wednesday, May W, 2017 HALLIBURTON Customer: Nordaq Tiger Eye 1 Surface Plug 2.1 Job Event Log Type Seq. Activity Graph label Date Time Source p5 Pump Comb Pump stg Recirc Comments No. Press Pump Tot Density Rate (0) (bbVmir) (bbo (ppq) Event 1 StartJob Start Job 9/1/2017 07:32:55 COM6 31.00 0.00 0.00 8.42 Event 2 Break Circulation Break Circulation 9/1/2017 07:33:04 USER 34.00 0.30 Break circulation with 30 0.00 8.42 bbls of fresh water 3 bpm 135 psi Event 3 Pump Gel Pill Pump Gel Pill 9/1/2017 07:39:05 USER 135.00 3.20 0.00 0.D4 Pump 15 bbls of gel pill 3 bpm 125 psi Event 4 Pump Displacement Pump Displacement 9/1/2017 07:44:34 USER 99.00 3.20 Pump 0.9 bbls of fresh 17.60 0.03 water to balance. 3 bpm 97psi Shut down pumps and Event 5 Other Shutdown 9/1/2017 07:45:35 USER 20.00 0.00 1.00 0.03 check flow back to displacement tank. No flow back pill is balanced. Event 6 Clean lines Wait on Pollard 9/1/2017 07:46:40 USER 17.00 0.00 1.00 0.03 Clean pumps and wart on Pollard to set bridge plug and pert holes Event 7 Circulate Well Circulatetubingand 9/1/2017 10:20:29 USER 17.00 Circulate tubing and annulus to surface through anulus annulus 0.00 0.20 8.43 perfs at 200 to 202.2'to cleargel Event 8 Inject Down Annulus Inject 9/1/2017 10:29:40 USER 4.00 Inject 45 bbls from slop tank 0.00 0.00 8.42 down annulus followed by 10 bbls fresh water Pump down 7" X 9.625 Event 9 Pump Cement Pump Cement 9/1/2017 10:48:37 USER 2.00 0.00 annulus - 93.2 bbis cement 0.00 8.34 at 15.8 pp&450 sacks, 1.163 d/sk, 5.085 gal/sk. Final pump pressure was iCerti Service Page 5 jv. 4.2.393) Created: Wednesday, May 10', 2017 HALLIBURTON Customer: Norclaq Tiger Eye 1 Surface Plug iCem` Service Page 6 (v. 4.2.393) Created: Wednesday, May le, 2017 315psi at 45 bpm, shut in at 250 psi. Event 10 Shutdown End O.A. down squeeze 9/1/2017 1118:37 USER 457.00 3.50 89.70 1.36 As per customers request chased cement with 0.75 bbl of water to clear well head. Pump through Paris in 2.875' X 7" to surface - 8.3 bbis cement at 15.8ppg, 40 Event 11 PumpCement Pump Cement 9/1/2017 11:32:39 USER 13.00 0.90 1.30 15.92 sacks,1 gal/zk.2 bbi d/sit, cament bls good cement to surface. As per customers request chased with 0.75 bbl of water to clear well head Event 12 End lob End Joh 9/1/2017 12:05:00 COME 20.00 2.00 15.90 0.16 Recirc density charted on chart due erratic readings on HPVr caused from low back pressures. iCem` Service Page 6 (v. 4.2.393) Created: Wednesday, May le, 2017 HALLIBURTON 3.1 Viscous PIII lob C'batt II . 11 II II II I I � kyr II If I 11 it 11 17 ii 11 I I II li II RUM OMA Page 7 Customer: Nordaq Tiger Eye 1 Surface Plug iG`3Sl0 07SM W*" A�1.- "n °:or. -:ass •ea; :r. t o,+re ?a:a mt"m.: v :5:y is :GC ?arc Daeay �r iCem Service (v. 6.2993) Created: Wednesday, May l0a', 2017 9MIM7 HALLIBURTON 3.2 Cement Job Chart NordagTiger eye #t PTA Customer: Nordaq Tiger Eye 1 Surface Plug - A Page 9 1aTYGl _i13N ',�� 11A&Ca ;2d�`_A 1fu�01J .-t'as;Tme PS :Urp-Ecs (c;� ar„e Pwm:s,=.CC,nm^` -.m"Sg ioi':Sf ^:::rc }xssy yoe iCem Service (V. 4.2.393) Created: Wednesday, May 10a', 2017 iCem Service NORDAQ ENERGY INC - EBUS United States of America For: Pete Dickinson Date: Wednesday, September 13" 2017 Top Out Job Date: Wednesday, September 6"', 2017 Sincerely, Savannah Afoa uICPIC� Wlarnino Disclaimer Although the information contained in this report is based on sound engineering practices, the copyright owner(s) does (do) not accept any responsibility whatsoever, in negligence or otherwise, for any loss or damage arising from the possession or use of the report whether in terms of correctness or otherwise. The application, therefore, by the user of this report or any part thereof, is solely at the user's own risk. Limitations Ul i,_iabihly Except as expressly set forth herein, there are no representations or warranties by Halliburton, express or implied, including implied warranties of merchantability and/or fitness for a particular purpose. In no event will Halliburton or its suppliers be liable for consequential, incidental, special, punitive or exemplary damages (including, without limitation, loss of data, profits, use of hardware, or software). Customer accepts full responsibility for any investment made based on results from the Software. Any interpretations, analyses or modeling of any data, including, but not limited to Customer data, and any recommendation or decisions based upon such interpretations, analyses or modeling are opinions based upon inferences from measurements and empirical relationships and assumptions, which inferences and assumptions are not infallible, and with respect to which professional may differ. Accordingly, Halliburton cannot and does not warrant the accuracy, correctness or completeness of any such interpretation, recommendation, modeling or other products of the Software Product. As such, any interpretation, recommendation or modeling resulting from the Software for the purpose of any drilling, well treatment, production or financial decision will be at the sole risk of Customer. Under no circumstances will Halliburton or its suppliers be liable for any damages. HALLIBURTON Customer: Nordaq Tiger Eye 1 Top Out (Cern Service (v. 4.2.393) Created: Wednesday, May 10'x, 2017 Page 3 HALLIBURTON Mr. Dickinson, Customer: Nordaq Tiger Eye 1 Top Out Halliburton appreciates the opportunity to perform the cementing services on Tiger Eye Central I. A pre -job safety meeting was held where details of the job were discussed and potential safety hazards were reviewed. At 13:00 the Halliburton cement arrived on location to pump top -out cement. The cementjob began at 15:16 with 1 bbl of water during which time maximum pressure was 20 psi. This was followed with 25 sks/5 bbls of 15.8 ppg cement, and 2 bbls returned to surface. At 15:41 the unit shutdown and lined up to wash up into an open -top tank. Thejob was completed at 16:00 and the crew left location at 17:30. Halliburton maintains a continuous quality improvement process and appreciates any comments or suggestions that you may have. Halliburton Energy Services again thanks you for the opportunity to perform services work on this well. We hope to be your so lutions provider for future projects. Thank You, Savannah Afoa Technical Professional — Cement and Casing Equipment 6900 Arctic Blvd. Anchorage, AK 99518 Email: aanunnah afaaGr!hallibunrn.aan Mobile: +1907-223-9423 Office: +1907-273-3568 *Ves14"n and Uefiver D"pelidab/e 8rtrrirry Tailored to Jimirnice Risk and d9aeimi; e Pradnefioa" Page 4 (v. 4.2.393) Created: Wednesday, May 10", 2017 HALLIBURTON Customer: Nordaq Tiger Eye 1 Top Out Type Seq. No. Activity Graph Label Date Time Source DS pump Press DH Density Comb Pump Comments Rate (psi) W9) (bb4min) Event 1 StartJob Start Job 9/6/2017 15:07:00 COMB -5.00 8.55 0,00 Event 2 Other Other 9/6/2017 15:16:24 USER -4.00 8.51 0.00 BOOST iBBL OF H2O 2oPSl PUMP 255K5 OF 15.80 Event 3 Pump Cement Pump Cement 9/6/2017 15:19:48 USER 55.00 15.83 0.00 LB/GAL 1.15 Fr/SK S.00 GALI KBOOSTED A TOTAL OF SBBL955PSI GOT 2BBLS OF CEMENTTO SURFACE. Event 4 Shutdown Shutdown 9/6/2017 15:41:17 USER5.00 16.14 0.00 SHUTDOWNANDWASH PUMP AND UNE TO OPEN TANK. Event 5 End Job End)ob 9/6/2017 16:00:00 COMB 22.00 9.32 0.00 iCem' Service Page 5 (v. 4.2.393) Created: Wednesday, May 10�, 2017 HALLIBURTON Customer: Nordaq Tiger Eye 1 Top Out 3.1 Job Chart TOP OUT NORDAO WELL#1 OrSflBii 15$N 35:1110 15',AOp linB20 15ini0 9yM7 trtaiT-k " , B ICem Service Page 6 (v. 4.2.393( Created: Wednesday, May 16', 2017 NORDAQ ENERGY, INC. TIGER EYE CENTRAL SEPTIC SYSTEM CLOSURE PLAN t SCALE VICINITY IMP I' 1 I I I I ... I I I I I 11 RECORD DRAWING NOTE ' _= THIS DRAWING WAS PREPARED TO DOCUMENT THE CLOSURE OF A SOIL ABSORPTION SYSTEM ON 31 AUGUST 2017 THE SYSTEM WAS DISPOSED IN PLACE IN ACCORDANCE WITH THIS PLAN S A. McLANE CE7863 DATE 1 PROJECT DISPOSE OF CONVENTIONAL SOIL ABSORPTION SYSTEM CONSISTING OF A 2,500 GALLON STEEL TANK AND ASS PIPING. LOCATION: NW$ NWyJ SECTION 14. TSN. RNW 5.M AK KUSTATAN AREA IN THE KENAI PENINSULA BOROUGH. LEGEND —' — GE4'iCRIWk - OESNiN R0.SI}ShWIU;p CSVJOyRLR�3 M!ffACf RPFF - l3CR^rSEP Cut1tRT,JSE: INDEX OF SHEETS $MEET ND OF !_ PWmm 6lOGTply S112 RAN � sysTFi.1JK.waJroTEs _ N tYPIGL SEGRgN661416 NORDAQ ENERGY INC. 3000 A STEET, SUITE 410 ANCHORAGE, AK 99501 WETLANDS WITH PERIODIC SURFACE WATER W i UQ'zV Eus.uw sr�t, c�a o wnrrn v2u to ce uro�a er orNms U � 700 FT. SETBACK O W y } W N a E>GSTINO SEPTIC SYSTEM SEE SHEET 3 ABANDONMENT DETAIL REMOVE 4' STANDPIPES AT EACH END OF EACH LEACH TRENCH. ABANDON TANK INDUCE ft5' PULL OUT ALL EXPOSED PIPES GPO Ja05`T°lo 0 1 SCO 11 6 SEPTIC TANK, 2500 GAL. STEEL REVISION 1 I-- SOLIDS DIPOSAL ARE RECORD ABANDONMENT AND CLOSURE NOTES: I 1, TANK WAS PUMPED BY OTHERS PRIOR TO ABANDONMENT. t 2. TANK WAS EXCAVATED AND EXPOSED. TOP WAS CUT t OPEN TO EXPOSED BOTH COMPARTMENTS. 3. APPROXIMATELY 5 GALLONS OF SLUDGE WAS REMOVED AND SPREAD ON SOIL ADJACENT TO TANK. THIS P THICK LAYER OF SLUDGE WAS COVERED WITH A DUSTING OF HYDRATED LIME. (\l 4. TANK BOTTOM WAS PERFORATED, A DUSTING OF LIME APPLIED, THEN BACKFILLED WITH NATIVE SOIL. 5. ALL STANDPIPES AND MONITOR TUBES WERE PULLED AND VOIDS BACKFILLED WITH NATIVE SOIL. / 6. SITE WAS GRADED TO PRE -DISTURBANCE CONTOURS. j ABANDONMENT AND CLOSURE NOTES. 1 COMPLY WITH ALL REQUIREMENTS OF I8AAC 72880. 2 MAINTAIN SEPARATION DISTANCES PER 18 AAC 72.020 3. PUMP TANK LIQUIDS INTO SOIL ABSORPTION SYSTEM. 4. EXCAVATE ANO EXPOSE STEEL SEPTIC TANK. REMOVE MANHOLE COVERS FROM EACH END. ESTIMATE SLUDGE AND SOLIDS VOLUME. THE FIRST COMPARTMENT HOLDS ABOUT 8 CUBIC YARDS 5. EXCAVATE A TRENCH ADJACENT TO THE SEPTIC TANK TRENCH SHALL BE 6 FT. DEEP ALLOW FOR AT LEAST 3 FT OF SOIL COVER 8. OPEN TOP OF TANK BETWEEN THE MANHOLE COVERS TO EXPOSE BOTH COMPARTMENTS AND ALLOW ACCESS FOR SOLIDS REMOVAL 7. REMOVE SLUDGE AND SOLIDS WITH EXCAVATOR, TRANSFER TO TRENCH IN LAYERS 12 INCH MAXIMUM DEPTH SPRINKLE HYDRATED LIME OVER THE LAYERS PROVIDING LIGHTCOVERAGE REPEAT AS NECESSARY UNTIL ALL SOLIDS ARE BURIED 8. PERFORATE BOTTOM OF TANK IN EACH COMPARTMENT WITH EXCAVATOR. SPRINKLE LIGHT COVER OF LIME OVER TANK BOTTOM, THEN BACKFILL WITH NATIVE SOIL 9. REMOVE ALL STAND PIPES BY SURFACE EXCAVATION THEN PULL OUT WITH EXCAVATOR. 10. BACKFILL AND GRADE TO MATCH NATURAL CONTOURS 11. TAKE DIGITAL PHOTOS TYPICAL OF EACH PHASE AND DELIVER TO ENGINEER. u w �O U°ZU C)U� DC w � Ou i Z u U C7 d � w N 3 Picture Descriptions 8a IMG -1727 Cmt visible except 7 x 9 5-8 8b IMG -1736 Cmt to surface after top job Sc IMG -1745 name plate on casing 8d IMG -1740 ALL annuli cemented 9a IMG -1752 location cleared other eqpmt Glacier 9b IMG -1753 location, 9c IMG -1757 location 9c IMG 1757 location I J A lr� st A; VISW -T KrI e. oy j 590 � c .a 1 s l'. L' :f a ` r + W 't t r w i. v a MIN a S- �y_���' `_ - �L. Y: "`ry ��.., 1.,.q, vim•._ -,-�c�'�.ti.^"`+.fir 1 .rs✓"•�y�`�Y�t '4�„�i�i .r G .!' �- _ _... � \tea. �.� . : � �f 4,. • , ~� `�.�-+..... � rM V o. 44 w y �-J C tl � Y aS i•-= ~ter � ' � i R % Y , • �v S G r `j ! r.>. :a1 i TIGER EYE CENTRAL #1 BHA LOG 8-22-17 Database File tiger eye central #1 db Dataset Pathname TIGER_EYE_CENTRAL_#1lCCL1/PASS1 Presentation Format ccl Dataset Creation Tue Aug 22 18:10:55 2017 Charted by Depth in Feet scaled 1:240 CCL 000� 4-i-2.7/8" TUBING JT +- BAKER MODEL"0" PACKER 5900 5950 +=— 2-718" TUBING JT. f-2-7/8" TUBING JT f— BAKER MODEL "D" PACKER 6000 +-2-718" TUBING JT. TIGER EYE #1 8-23-17 TUBING PUNCH #1 5920' - 5922'(10 SHOTS) Database File tiger eye central #1.db Dataset Pathname TIGER_EYE_CENTRAL_#1Jtbgpunchl7PASS7 Presentation Format ccl Dataset Creation Wed Aug 23 10:17:42 2017 Charted by Depth in Feet scaled 1:240 5 -- CCL 5 — --------------- I 5800 I 2-7/8" TUBING 5850 +— 2-7/8" TUBING F BAKER MODEL "D" PACKER M F CCL DEPTH (3.5' CCL TO TOP SHOTI ® +—TUBING PUNCH h 2-718" TUBING 5950 TIGER EYE 1 TAG1 8-27-17 TOC @ 5,618' MD Database File tiger eye central #1.db Dataset Pathname TIGER_EYE_CENTRAL_i1/TAG I/PASS12 Presentation Format col Dataset Creation Sun Aug 2712:16:57 2017 Charted by Depth in Feet scaled 1:240 5 CCL -5 0 LTEN (lb) 5000 5450 4 5500 5550 5600 i-- CCL, BTS 8.7 BELOW CCL. t— TOC @ 5,618' MO ---- CCL --- LTEN (Ib) y TIGER EYE 1 CIBP1 8-28-17 CJBP SET @ 5,607' MD Database File tiger eye central #t.db Dataset Pathnome TIGER_EYE—CENTRAL_#1/CIBP1/PASS3 Presentation Format ccl Dataset Creation Mon Aug 28 17:29:51 2017 Charted by Depth in Feet scaled 1:240 15 CCL -51 10 LTEN (lb) 5000 i— CCL STOP DEPTH _ 5,599.5'MD - 4-- CCL PICKUP +- CIBP SET @ 5,607' MD 15 CCL .51 10 LTEN (lb) 5000 3 TIGER EYE 1 TAG2 8-28-17 TOC @ 5,617.5 MD Database File tiger eye central #1.db Dataset Pathname TIGER—EYE—CENTRAL—#1f rAG2/PASS9 Presentation Format ccl Dataset Creation Mon Aug 28 15:49:13 2017 Charted by Depth in Feet scaled 1:240 15 CCL -51 10 LTEN (lb) 5000 5450 5500 5550 5600 — 4— CCL, 8T8 9,5' BELOW CCL f— TOC @ 5,617.5' MD CCL -5 0 LTEN (Ib) 5000 TIGER EYE 1 TUBING PUNCH 2 (5-29-17) -Em SHOTS FIRED FROM 5,590.7' MD -5,593' MD Database File tiger eye central #1,clb Dataset Pathname TIGER—EYE—CENTRAL WI/PNCH7JPASS5 Presentation Format col Dataset Creation Tue Aug 29 09:54:36 2017 Charted by Depth In Feet scaled 1:240 5 CCL -5 0 LTEN (lb) 5000 i i 5550 i 5600 i CCL •51 10 LTEN (lb) TIGER EYE 1 CIBP2 8-30-17 CIBP SET @ 5,067.6' MD Database File tiger eye central #1.db Dataset Pathname TIGER _EYE_CENTRAL #1/CI8P21PASS4 Presentation Format col Dataset Creation Wed Aug 3019:01:55 2017 Charted by Depth in Feet scaled 1:240 5 CCL -5 0 LTEN (lb) 5000 5050 i � I +— CCL STOP DEPTH 5,060MD 1— CIBP SET @ 5,067.6 MD, i I 5 CCL 5 0 LTEN (Ib) 5000 TIGER EYE TAG3 8-30-17 TOC @ 5,081.2' MD Database File tiger eye central #1 -db Dataset Pathname TIGER_EYE_CENTRAL #1lrAG3/PASS2 Presentation Format col Dataset Creation Wed Aug 3014:55:41 2017 Charted by Depth In Feet scaled 1:240 5 CCL -5 0 LTEN (lb) 5000 i I i 5050 I i i I i i CCL LIEN (lb) � J TIGER EYE 1 TAG4 8-30-17 TOC @ 5,082' MD Database File tiger eye central #1 .db Dataset Pathname TIGER_EYE_CENTRAL_#1/TAG4/PASS4 Presentation Format ccl Dataset Creation Wed Aug 3017:21:42 2017 Charted by Depth in Feet scaled 1:240 15 CCL -5I IO LTEN (lb) 50001 5050 1—CCL, BTS 9.5' BELOW CCL +— TOC @ 5,082' MD 15 CCL -5i 10 LTEN (ib) 50001 TIGER EYE 1 TUBING PUNCH 3 (8-31-17) SHOTS FIRED FROM 598.7' MD TO 601' MD Database File tiger eye central #1.db Dataset Pathname TIGER_EYE_CENTRAL_#1/PNCH3/PASS3 Presentation Format cel Dataset Creation Thu Aug 31 14:56:24 2017 Charted by Depth in Feet scaled 1:240 5 CCL 5 0 LTEN (lb) 5000 250 300 350 M 500 �- CCL STOP DEPTH. TS IT BELOW CCL 600 CCL TIGER EYE CIBP3 9-1-17 CIBP SET @ 230' MD Database File tiger eye central #1.db Dataset Pathname TIGER—EYE—CENTRAL #1/CIBP3/PASS4 Presentation Format ccl Dataset Creation Fri Sep 0108:45:42 2017 Charted by Depth in Feet scaled 1:240 5 CCL -5 IV LTEN(Ib) 5000 I 200 CCL 5 0 _ LTEN (lb) TIGER EYE 1 TUBING PUNCH 4 (9-1-17) SHOTS FIRED FROM 200' MD TO 202.3' MD Database File tiger eye central #1.db Dataset Pathname TIGER_EYE_CENTRAL_#1/PNCH4/PASS2 Presentation Format cd Dataset Creation Fri Sep 01 09:27:46 2017 Charted by Depth in Feet scaled 1:240 CCL -5 1 150 �- CCL STOP DEPTH, TS 3.T BELOW CCL. 200 LTEN (lb) 5 CCL -51 10 LTEN (lb) 5000 STATE OF ALASKA ALASKA OIL AND GAS CONSERVATION COMMISSION Docket No. OTH-16-031 and OTH-16-032 Applications for Reconsideration September 20, 2017 at 10:00 am NAME AFFILIATION Testify (ves or no) rWj no BG -e�-L Rr S�evP:eS +fit, cc nCj Ky-cske l I 61S' D rI Pe4ro leurn /flews A/'(-) C (miler —5isar icd k.' FwS AJb C�r;S ua� e 4, 0 C, C C- 4,0 C.? CC v4, ORIGINAL �� ix Second Corrected Notice of Public Hearing STATE OF ALASKA ALASKA OIL AND GAS CONSERVATION COMMISSION Re: Docket Number: OTH-16-031 and OTH 16-032 NordAq Energy, Inc. The applications for Reconsideration of the Decision and Order's issued in this matter by the AOGCC. The AOGCC has scheduled oral argument on these applications for September 20, 2017, at 10:00 a.m. at 333 West 7 t Avenue, Anchorage, Alaska 99501. If, because of a disability, special accommodations may be needed to comment or attend the hearing, contact the AOGCC's Special Assistant, Jody Colombie, at (907) 793-1221, no later than September 19, 2017. Hollis S. French Chair, Commissioner David Pfeiffer Chief Financial Officer NordAq Energy, Inc. 560 E. 34' Ave., Ste. 200 Anchorage, AK 99503 rite CL Second Corrected Notice of Public Hearing STATE OF ALASKA ALASKA OIL AND GAS CONSERVATION COMMISSION Re: Docket Number: OTH-16-031 and OTH 16-032 NordAq Energy, Inc. The applications for Reconsideration of the Decision and Order's issued in this matter by the AOGCC. The AOGCC has scheduled oral argument on these applications for September 20, 2017, at 10:00 a.m. at 333 West 7`h Avenue, Anchorage, Alaska 99501. If, because of a disability, special accommodations may be needed to comment or attend the hearing, contact the AOGCC's Special Assistant, Jody Colombie, at (907) 793-1221, no later than September 19, 2017. //signature on file// Hollis S. French Chair, Commissioner Bernie Karl K&K Recycling Inc. Gordon Severson Penny Vadla P.O. Box 58055 3201 Westmar Cir. 399 W. Riverview Ave. Fairbanks, AK 99711-0055 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 99639-0309 Fairbanks, AK 99706-0868 Colombie, Jody J (DOA) From: Colombie, Jody 1 (DOA) Sent: Monday, September 18, 2017 8:07 AM To: 'rbrena@brenalaw.com'; 'aguerriero@brenalaw.com'; 'Igould@brenalaw.com' Subject: FW: Second Corrected Public Notice Attachments: CO 16-031 and CO 16-032 Oral Argument Second Corrected.pdf From: Colombie, Jody J (DOA) Sent: Monday, September 18, 2017 8:05 AM To: DOA AOGCC Prudhoe Bay <doa.aogcc.prudhoe.bay@alaska.gov>; Bender, Makana K (DOA) <makana.bender@alaska.gov>; Bettis, Patricia K (DOA) <patricia.bettis@alaska.gov>; Brooks, Phoebe L (DOA) <phoebe.brooks@alaska.gov>; Carlisle, Samantha J (DOA) <samantha.carlisle@alaska.gov>; Colombie, Jody J (DOA) <jody.colombie@alaska.gov>; Davies, Stephen F (DOA) <steve.davies@alaska.gov>; Foerster, Catherine P (DOA) <cathy.foerster@alaska.gov>; French, Hollis (DOA) <hollis.french@alaska.gov>; Frystacky, Michal (DOA) <michal.frystacky@alaska.gov>; Guhl, Meredith D (DOA) <meredith.guhl@alaska.gov>; Kair, Michael N (DOA) <michael.kair@alaska.gov>; Link, Liz M (DOA) <Iiz.link@alaska.gov>; Loepp, Victoria T (DOA) <victoria.loepp@alaska.gov>; Mumm, Joseph (DOA sponsored) <joseph.mumm@alaska.gov>; Paladijczuk, Tracie L (DOA)<tracie.palad ijczuk@alaska.gov>; Pasqual, Maria (DOA) <maria.pasqual@alaska.gov>; Quick, Michael J (DOA) <michael.quick@alaska.gov>; Regg, James B (DOA) <jim.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) <angela.singh@alaska.gov>; Wallace, Chris D (DOA) <chris.wallace@alaska.gov>; AK, GWO Projects Well Integrity <AKDCProjectsWelllntegrityEngineer@bp.com>; AKDCWelllntegrityCoordinator <AKDCWellintegrityCoordinator@bp.com>; Alan Bailey <abailey@petroleumnews.com>; Alex Demarban <alex@alaskadispatch.com>; Alicia Showalter <ashowalter@hilcorp.com>; Allen Huckabay <allenhuckabay@hotmail.com>; Andrew VanderJack <AMV@vnf.com>; Ann Danielson <Ann.Danielson@bp.com>; Anna Raff <anna.raff@dowjones.com>; Barbara F Fullmer <barbara.f.fullmer@conocophillips.com>; bbritch <bbritch@alaska.net>; bbohrer@ap.org; Ben Boettger <benjamin.boettger@peninsulaclarion.com>; Bill Bredar <william.bredar@bp.com>; Bob Shavelson <bob@inletkeeper.org>; Brandon Viator <Brandon.S.Viator@conocophillips.com>; Brian Havelock <behavelock@gmail.com>; Bruce Webb <b.webb@furiealaska.com>; Caleb Conrad <caleb.conrad@bakerhughes.com>; Candi English <c.english@nsakllc.com>; Cocklan- Vendl, Mary E <mary.cocklan-vendl@bp.com>; Cody Gauer <cody.gauer@enipetroleum.com>; Colleen Miller <cmiller@ciri.com>; Connie Downing <cdowning@tyonek.com>; Crandall, Krissell <Krissell.Crandall@bp.com>; D Lawrence <DLawrence4@slb.com>; Dale Hoffman <dale.hoffman@caelusenergy.com>; Darci Horner <dhorner@hilcorp.com>; Dave Harbour <harbour@gci.net>; David Boelens <dboelens@aurorapower.com>; David Duffy <dduffy@hilcorp.com>; David House <dhouse@usgs.gov>; David McCaleb <david.mccaleb@ihs.com>; David McCraine <d.mccraine@furiealaska.com>; ddonkel@cfl.rr.com; Diemer, Kenneth J (DNR) <ken.diemer@alaska.gov>; DNROG Units (DNR sponsored) <dog. units@a laska.gov>; Donna Ambruz <dambruz@hilcorp.com>; Ed Jones <jejones@aurorapower.com>; Elizabeth Harball <eharball@alaskapublic.org>; Elowe, Kristin <Kristin.Elowe@mms.gov>; Elwood Brehmer <elwood.brehmer@alaskajournal.com>; Evan Osborne <Osborne.Eva n@epa.gov>; Evans, John R (LDZX) <John.R.Evans@conocophillips.com>; Brown, Garrett A (DNR) <garrett.brown@alaska.gov>; George Pollock <gpollock@aurorapower.com>; Gordon Pospisil <PospisG@BP.com>; Greeley, Destin M (DOR) <destin.greeley@alaska.gov>; Gretchen Stoddard <mgstodda rd @gci. net>; gspfoff <gspfoff@aurorapower.com>; Hunter Cox <hcox@vnf.com>; Hurst, Rona D (DNR) <rona.hurst@alaska.gov>; Hyun, James J (DNR) <james.hyun@alaska.gov>; Jacki Rose <jrose@bluecrestenergy.com>; Jason Brune <JBrune@ciri.com>; Jdarlington (jarlington@gmail.com) <jarlington@gmail.com>; Jeanne McPherren <jmcpherren@brenalaw.com>; Jerry Hodgden <geodogs@comcast.net>; Jill Simek <Jill.Simek@conocophillips.com>; Jim Watt <jwatt@strongenergyresources.com>; Jim White <jimwhite@satx.rr.com>; Joe Lastufka <lastufjn@bp.com>; Radio Kenai <news@rad iokenai.com>; Burdick, John D (DNR) <john.burdick@alaska.gov>; Easton, John R (DNR) <john.easton@alaska.gov>; Larsen, John M (DOR) <john.larsen@alaska.gov>; John Stuart <j.stuart@furiealaska.com>; Jon Goltz <Jon.Goltz@conocophillips.com>; Chmielowski, Josef (DNR) <josef.chmielowski@alaska.gov>; Juanita Lovett <jlovett@hilcorp.com>; Judy Stanek <jstanek@hilcorp.com>; Kari Moriarty <moriarty@aoga.org>; Kasper Kowalewski <kasper.kowalewski@cop.com>; Kazeem Adegbola <kazeem.a.adegbola@conocophillips.com>; Keith Torrance <keith.torrance@uicumiaq.com>; Keith Wiles <kwiles@marathonoil.com>; Kelly Sperback <ksperbeck@slb.com>; Frank, Kevin J (DNR) <kevin.frank@alaska.gov>; Kruse, Rebecca D (DNR) <rebecca.kruse@alaska.gov>; Kyla Choquette <Kyla.Choquette@bp.com>; Gregersen, Laura S (DNR) <laura.gregersen@alaska.gov>; Leslie Smith <I.smith@furiealaska.com>; Lori Nelson <Inelson@hilcorp.com>; Luke Keller <Ikeller@hilcorp.com>; Marc Kovak <yesnoak@gmail.com>; Dalton, Mark (DOT sponsored) <Mark.Dalton@hdrinc.com>; Mark Hanley (mark.hanley@anadarko.com) <mark.hanley@anadarko.com>; Mark Landt <landtman4@yahoo.com>; Mark Wedman <mark.wedman@pxd.com>; Mealear Tauch <mzt@vnf.com>; Michael Bill <billmk@acsalaska.net>; Michael Calkins <mcalkins117@yahoo.com>; Michael Moora <mmoora@anvilcorp.com>; Mike Morgan <mike.morgan@caelusenergy.com>; MJ Loveland <N1878@conocophillips.com>; mkm7200 <mkm7200@aol.com>; Motteram, Luke A <luke.a.motteram@exxonmobil.com>; Mueller, Marta R (DNR) <marta.mueller@alaska.gov>; knelson@petroleumnews.com; Nichole Saunders <nsaunders@edf.org>; Nick Ostrovsky <nostrovsky@ahtna.net>; Nikki Martin <martin@aoga.org>; NSK Problem Well Supv <n1617@conocophillips.com>; Patty Alfaro <palfaro@yahoo.com>; Paul Craig <drpaulcraig@gmail.com>; Decker, Paul L (DNR) <paul.decker@alaska.gov>; Paul Mazzolini <pmazzolini@hilcorp.com>; Pike, Kevin W (DNR) <kevin.pike@alaska.gov>; Randall Kanady <Randall.B.Kanady@conocophillips.com>; Renan Yanish <renan@astercanyon.com>; Richard Cool <cool.richard@epa.gov>; Robert Brelsford <robert.brelsford@argusmedia.com>; Robert Warthen <rwarthen@nordagenergy.com>; Sara Leverette <saleverette@stoel.com>; Scott Griffith <scott_griffith@xtoenergy.com>; Shahla Farzan <shahla@kbbi.org>; Shannon Donnelly <shannon.donnelly@conocophillips.com>; Sharon Yarawsky <syarawsk@blm.gov>; Skutca, Joseph E (DNR) <joseph.skutca@alaska.gov>; Smart Energy Universe <admin@smartenergyuniverse.com>; Smith, Kyle S (DNR) <kyle.smith@alaska.gov>; Stephanie Klemmer <sklemmer@hilcorp.com>; Stephen Hennigan <shennigan@peiinc.com>; Sternicki, Oliver R <Oliver.Sternicki@bp.com>; Moothart, Steve R (DNR) <steve.moothart@alaska.gov>; Steve Quinn <smgwrite@gmail.com>; Suzanne Gibson <sgibson@ciri.com>; sheffield@aoga.org; Ted Kramer <tkramer@hilcorp.com>; Teresa Imm <timm@asrc.com>; Tim Jones <tjones@glacieroil.com>; Tim Mayers <mayers.timothy@epa.gov>; Todd Durkee <todd.durkee@anadarko.com>; Tom Maloney <tmaloney@ahtna.net>; trmjrl <trmjrl@aol.com>; Tyler Senden <r.tyler.senden@conocophillips.com>; Umekwe, Maduabuchi P (DNR) <pascal.umekwe@alaska.gov>; Vinnie Catalano <catalano@circac.org>; Well Integrity <n2550@conocophillips.com>; Well Integrity <n2549@conocophillips.com>; Weston Nash <Weston.Nash@bp.com>; Whitney Pettus <Whitney.Pettus@bp.com>; Aaron Gluzman <aaron.gluzman@gmail.com>; Aaron Sorrell <Aaron.Sorrell@BP.com>; Ajibola Adeyeye <Ajibola_Adeyeye@xtoenergy.com>; Alan Dennis <Alan.Dennis@bp.com>; Andy Bond <Andy.Bond @caelusenergy.com>; Bajsarowicz, Caroline 1 <Caroline.Bajsarowicz@bp.com>; Bruce Williams <bruce.williams@bp.com>; Bruno, Jeff (DNR) <jeff.bruno@alaska.gov>; Casey Sullivan <Casey.Sullivan@pxd.com>; Corey Munk <Corey.Munk@BP.com>; Don Shaw <shawmanseafoods@yahoo.com>; Eppie Hogan <eppie.hogan@bp.com>; Eric Lidji <ericlidji@mac.com>; Garrett Haag <Garrett.B.Haag@conocophillips.com>; Smith, Graham O (DNR) <graham.smith@alaska.gov>; Heusser, Heather A (DNR) <heather.heusser@alaska.gov>; Fair, Holly S (DNR) <holly.fair@alaska.gov>; Jamie M. Long <jamie.m.long@esso.ca>; Jason Bergerson <Jason. Bergerson @ north-slope.org>; Jesse Chielowski <jchmielowski@blm.gov>; Jim Magill <jim_magill@platts.com>; Shine, Jim M (DNR) <jim.shine@alaska.gov>; Joe Longo <Joe. Longo@hxrd ril lingservices.com>; John Martineck <john@bluecrestenergy.com>; Josh Kindred <kindred@aoga.org>; Keith Lopez <Keith.Lopez@caelusenergy.com>; Laney Vazquez <LVazquez@chevron.com>; Lois Epstein <lois_epstein@tws.org>; Longan, Sara W (DNR) <sara.longan@alaska.gov>; Louisiana Cutler <louisiana.cutler@klgates.com>; Marc Kuck <Marc.kuck@enipetroleum.com>; Marcia Hobson <mhobson@eenews.net>; Steele, Marie C (DNR) <marie.steele@alaska.gov>; Matt Armstrong <Matt.Armstrong@bakerhughes.com>; Melonnie Amundson <Melonnie.Amundson@caelusenergy.com>; Franger, James M (DNR) <mike.franger@alaska.gov>; Morgan, Kirk A (DNR) <kirk.morgan@alaska.gov>; Umekwe, Maduabuchi P (DNR) <pascal.umekwe@alaska.gov>; Pat Galvin <pat@greatbearpetro.com>; Pete Dickinson <pdickinson@a Ila mericanoilfield.com>; Peter Contreras <contreras.peter@epa.gov>; Rachel Davis <Rachel.Davis@caelusenergy.com>; Richard Garrard <rgarrard@nordaqenergy.com>; Richmond, Diane M <Diane.Richmond@bp.com>; Robert Province <robert.province@enipetroleum.com>; Ryan Daniel <Ryan.DanieI@bp.com>; Sandra Lemke <Sandra.D.Lemke @conocophillips.com>; Pollard, Susan R (LAW) <susan.pollard@alaska.gov>; Talib Syed <talibs@ecentral.com>; Tina Grovier (tmgrovier@stoel.com) <tmgrovier@stoel.com>; William Van Dyke <bvandyke @ petroak.com> Subject: Second Corrected Public Notice I apologize for second corrected notice. Corrected the Docket Numbers as well as added Inc. to Operator's Name. Jody J. Colombie AOGCC SpeciafAssistant `Kaska OilandGas Conservation Commission 333 west 7F .avenue Anchorage, Alaska 995oi Office: (907) 793-1221 Fax: (907) 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 )odv. colombie®alaska aov. Corrected Notice of Public Hearing STATE OF ALASKA ALASKA OIL AND GAS CONSERVATION COMMISSION Re: Docket Number: CO -16-031 and CO 16-032 NordAq Energy. The applications for Reconsideration of the Decision and Order's issued in this matter by the AOGCC. The AOGCC has scheduled oral argument on these applications for September 20, 2017, at 10:00 a.m. at 333 West 7th Avenue, Anchorage, Alaska 99501. If, because of a disability, special accommodations may be needed to comment or attend the hearing, contact the AOGCC's Special Assistant, Jody Colombie, at (907) 793-1221, no later than September 19, 2017. i Hollis S. French Chair, Commissioner David Pfeiffer Chief Financial Officer NordAq Energy, Inc. 560 E. 30 Ave., Ste. 200 Anchorage, AK 99503 Corrected Notice of Public Hearing STATE OF ALASKA ALASKA OIL AND GAS CONSERVATION COMMISSION Re: Docket Number: CO -16-031 and CO 16-032 NordAq Energy, The applications for Reconsideration of the Decision and Order's issued in this matter by the AOGCC. The AOGCC has scheduled oral argument on these applications for September 20, 2017, at 10:00 a.m. at 333 West 7a' Avenue, Anchorage, Alaska 99501. If, because of a disability, special accommodations may be needed to comment or attend the hearing, contact the AOGCC's Special Assistant, Jody Colombie, at (907) 793-1221, no later than September 19, 2017. //signature on file// Hollis S. French Chair, Commissioner Bernie Karl K&K Recycling Inc. Gordon Severson Penny Vadla P.O. Box 58055 3201 Westmar Cir. 399 W. Riverview Ave. Fairbanks, AK 99711-0055 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 99639-0309 Fairbanks, AK 99706-0868 "A'a-'�cL ' (-15-20 \Z Colombie, Jody J (DOA) From: Colombie, Jody J (DOA) Sent: Friday, September 15, 2017 2:59 PM To: DOA AOGCC Prudhoe Bay; 'rbrena@brenalaw.com'; 'aguerriero@brenalaw.com'; 'Igould@brenalaw.com'; Ballantine, Tab A (LAW); Bender, Makana K (DOA); Bettis, Patricia K (DOA); Brooks, Phoebe L (DOA); Carlisle, Samantha J (DOA); Colombie, Jody J (DOA); Davies, Stephen F (DOA); Foerster, Catherine P (DOA); French, Hollis (DOA); Frystacky, Michal (DOA); Guhl, Meredith D (DOA); Kair, Michael N (DOA); Link, Liz M (DOA); Loepp, Victoria T (DOA); Mumm, Joseph (DOA sponsored); Paladijczuk, Tracie L (DOA); Pasqual, Maria (DOA); Quick, Michael J (DOA); Regg, James B (DOA); Roby, David S (DOA); Schwartz, Guy L (DOA); Seamount, Dan T (DOA); Singh, Angela K (DOA); Wallace, Chris D (DOA); AK, GWO Projects Well Integrity; 'AKDCWelllntegrityCoordinator'; 'Alan Bailey'; 'Alex Demarban'; 'Alexander Bridge'; Alicia Showalter; 'Allen Huckabay'; 'Andrew VanderJack'; 'Ann Danielson'; Anna Raff; 'Barbara F Fullmer'; bbritch; bbohrer@ap.org;'Ben Boettger';'Bill Bredar'; Bob Shavelson; Brandon Viator; 'Brian Havelock'; 'Bruce Webb'; 'Caleb Conrad'; 'Candi English'; Cocklan-Vendl, Mary E; Cody Gauer; Colleen Miller, 'Connie Downing'; Crandall, Krissell;'D Lawrence'; 'Dale Hoffman'; 'Darci Horner'; 'Dave Harbour'; David Boelens;'David Duffy'; David House;'David McCaleb';'David McCraine';'ddonkel@cfl.rr.com'; Diemer, Kenneth J (DNR); DNROG Units (DNR sponsored); 'Donna Ambruz';'Ed Jones'; 'Elizabeth Harball'; Elowe, Kristin;'Elwood Brehmer';'Evan Osborne'; Evans, John R (LDZ1n; Brown, Garrett A (DNR); 'George Pollock'; Gordon Pospisil; Greeley, Destin M (DOR); 'Gretchen Stoddard'; gspfoff;'Hunter Cox'; Hurst, Rona D (DNR); Hyun, James J (DNR); 'Jacki Rose'; Jason Brune; Jdarlington Oarlington@gmail.com); 'Jeanne McPherren'; 'Jerry Hodgden'; Jill Simek;'Jim Watt'; Jim White;'Joe Lastufka'; Radio Kenai; Burdick, John D (DNR); Easton, John R (DNR); Larsen, John M (DOR); 'John Stuart'; Jon Goltz; Chmielowski, Josef (DNR); 'Juanita Lovett'; 'Judy Stanek'; Kari Moriarty, 'Kasper Kowalewski'; 'Kazeem Adegbola'; 'Keith Torrance'; Keith Wiles; Kelly Sperback; Frank, Kevin J (DNR); Kruse, Rebecca D (DNR); Kyla Choquette; Gregersen, Laura S (DNR); Leslie Smith; Lori Nelson; Louisiana Cutler; 'Luke Keller'; 'Marc Kovak'; Dalton, Mark (DOT sponsored); Mark Hanley (mark.hanley@anadarko.com); 'Mark Landt';'Mark Wedman';'Mealear Tauch'; 'Michael Bill'; Michael Calkins; 'Michael Moora'; Mike Morgan; MJ Loveland; mkm7200;'Motteram, Luke A'; Mueller, Marta R (DNR); knelson@petroleumnews.com; Nichole Saunders; 'Nick Ostrovsky'; Nikki Martin; NSK Problem Well Supv; Patty Alfaro; 'Paul Craig'; Decker, Paul L (DNR); 'Paul Mazzolini'; Pike, Kevin W (DNR); Randall Kanady; 'Renan Yanish'; 'Richard Cool'; 'Robert Brelsford'; Robert Warthen; Sara Leverette; 'Scott Griffith'; Shahla Farzan; Shannon Donnelly; 'Sharon Yarawsky'; Skutca, Joseph E (DNR); Smart Energy Universe; Smith, Kyle S (DNR); 'Stephanie Klemmer'; 'Stephen Hennigan'; Sternicki, Oliver R; Moothart, Steve R (DNR); 'Steve Quinn'; 'Suzanne Gibson'; sheffield@aoga.org; 'Ted Kramer'; Teresa Imm; Tim Jones; 'Tim Mayers'; Todd Durkee; 'Tom Maloney'; 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; Andy Bond; Sajsarowicz, Caroline J; 'Bruce Williams'; Bruno, Jeff J (DNR); Casey Sullivan; Corey Munk, 'Don Shaw'; Eppie Hogan; Eric Lidji; Garrett Haag; Smith, Graham O (DNR); Heusser, Heather A (DNR); Fair, Holly S (DNR); Jamie M. Long; 'Jason Bergerson'; Jesse Chielowski;'Jim Magill'; Shine, Jim M (DNR); Joe Longo; John Martineck; Josh Kindred; Keith Lopez, Laney Vazquez; Lois Epstein; Longan, Sara W (DNR); Marc Kuck; Marcia Hobson; Steele, Marie C (DNR); Matt Armstrong; Melonnie Amundson; Franger, James M (DNR); Morgan, Kirk A (DNR); Umekwe, Maduabuchi P (DNR); Pat Galvin; 'Pete Dickinson'; Peter Contreras; Rachel Davis; Richard Garrard; Richmond, Diane M; Robert Province; 'Ryan Daniel'; 'Sandra Lemke'; Pollard, Susan R (LAW); Talib Syed; Tina Grovier (tmgrovier@stoel.com); 'William Van Dyke' Subject: RE: Notice of Hearing - NorclAq Energy, Inc. Applications for Reconsideration - Corrected Attachments: CO 16-031 and CO 16-032 Oral Argument - Corrected.pdf Please see attached. Notice of Public Hearing STATE OF ALASKA ALASKA OIL AND GAS CONSERVATION COMMISSION Re: Docket Number: CO -16-031 and CO 16-032 The applications for Reconsideration of the Decision and Order's issued in this matter by the AOGCC. The AOGCC has scheduled oral argument on these applications for September 20, 2017, at 10:00 a.m. at 333 West 7`h Avenue, Anchorage, Alaska 99501. If, because of a disability, special accommodations may be needed to comment or attend the hearing, contact the AOGCC's Special Assistant, Jody Colombie, at (907) 793-1221, no later than September 19, 2017. CtDr Hollis S. French Chair, Commissioner Notice of Public Hearing STATE OF ALASKA ALASKA OIL AND GAS CONSERVATION Re: Docket Number: CO -16-031 and CO 16-032 The applications for Reconsideration of the Decision and Order's issued in this matter by the AOGCC. The AOGCC has scheduled oral argument on these applications for September 20, 2017, at 10:00 a.m. at 333 West 7t' Avenue, Anchorage, Alaska 99501. If, because of a disability, special accommodations may be needed to comment or attend the hearing, contact the AOGCC's Special Assistant, Jody Colombie, at (907) 793-1221, no later than September 19, 2017. //signature on file// Hollis S. French Chair, Commissioner Colombie, Jody J (DOA) From: Colombie, Jody J (DOA) Sent: Friday, September 15, 2017 2:11 PM To: DOA AOGCC Prudhoe Bay; rbrena@brenalaw.com; aguerriero@brenalaw.com; Igould@brenalaw.com; Ballantine, Tab A (LAW); Bender, Makana K (DOA); Bettis, Patricia K (DOA); Brooks, Phoebe L (DOA); Carlisle, Samantha J (DOA); Colombie, Jody J (DOA); Davies, Stephen F (DOA); Foerster, Catherine P (DOA); French, Hollis (DOA); Frystacky, Michal (DOA); Guhl, Meredith D (DOA); Kair, Michael N (DOA); Link, Liz M (DOA); Loepp, Victoria T (DOA); Mumm, Joseph (DOA sponsored); Paladijczuk, Tracie L (DOA); Pasqual, Maria (DOA); Quick, Michael J (DOA); Regg, James B (DOA); Roby, David S (DOA); Schwartz, Guy L (DOA); Seamount, Dan T (DOA); Singh, Angela K (DOA); Wallace, Chris D (DOA); AK, GWO Projects Well Integrity; AKDCWellIntegrityCoordinator, Alan Bailey, Alex Demarban; Alexander Bridge; Alicia Showalter; Allen Huckabay; Andrew Vandedack; Ann Danielson; Anna Raff; Barbara F Fullmer, bbritch; bbohrer@ap.org; Ben Boettger; Bill Bredar, Bob Shavelson; Brandon Viator; Brian Havelock; Bruce Webb; Caleb Conrad; Candi English; Cocklan-Vendl, Mary E; Cody Gauer; Colleen Miller; Connie Downing; Crandall, Krissell; D Lawrence; Dale Hoffman; Darci Horner, Dave Harbour, David Boelens; David Duffy; David House; David McCaleb; David McCraine; ddonkel@cfl.rr.com; Diemer, Kenneth J (DNR); DNROG Units (DNR sponsored); Donna Ambruz; Ed Jones; Elizabeth Harball; Elowe, Kristin; Elwood Brehmer; Evan Osborne; Evans, John R (LDZX); Brown, Garrett A (DNR); George Pollock, Gordon Pospisil; Greeley, Destin M (DOR); Gretchen Stoddard; gspfoff, Hunter Cox; Hurst, Rona D (DNR); Hyun, James J (DNR); Jacki Rose; Jason Brune; Jdarlington Garlington@gmail.com); Jeanne McPherren; Jerry Hodgden; Jill Simek; Jim Watt; Jim White; Joe Lastufka; Radio Kenai; Burdick, John D (DNR); Easton, John R (DNR); Larsen, John M (DOR); John Stuart; Jon Goltz; Chmielowski, Josef (DNR); Juanita Lovett; Judy Stanek; Kari Moriarty; Kasper Kowalewski; Kazeem Adegbola; Keith Torrance; Keith Wiles; Kelly Sperback; Frank, Kevin J (DNR); Kruse, Rebecca D (DNR); Kyla Choquette; Gregersen, Laura S (DNR); Leslie Smith; Lori Nelson; Louisiana Cutler, Luke Keller; Marc Kovak; Dalton, Mark (DOT sponsored); Mark Hanley (mark.hanley@anadarko.com); Mark Landt; Mark Wedman; Mealear Tauch; Michael Bill; Michael Calkins; Michael Moora; Mike Morgan; MJ Loveland; mkm7200; Motteram, Luke A, Mueller, Marta R (DNR); knelson@petroleumnews.com; Nichole Saunders; Nick Ostrovsky; Nikki Martin; NSK Problem Well Supv; Patty Alfaro; Paul Craig; Decker, Paul L (DNR); Paul Mazzolini; Pike, Kevin W (DNR); Randall Kanady; Renan Yanish; Richard Cool; Robert Brelsford; Robert Warthen; Sara Leverette; Scott Griffith; Shahla Farzan; Shannon Donnelly, Sharon Yarawsky; Skutca, Joseph E (DNR); Smart Energy Universe; Smith, Kyle S (DNR); Stephanie Klemmer; Stephen Hennigan; Sternicki, Oliver R; Moothart, Steve R (DNR); Steve Quinn; Suzanne Gibson; sheffield@aoga.org; Ted Kramer; Teresa Imm; Tim Jones; Tim Mayers; Todd Durkee; Tom Maloney; 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; Andy Bond; Bajsarowicz, Caroline J; Bruce Williams; Bruno, Jeff J (DNR); Casey Sullivan; Corey Munk; Don Shaw; Eppie Hogan; Eric Lidji; Garrett Haag; Smith, Graham O (DNR); Heusser, Heather A (DNR); Fair, Holly S (DNR); Jamie M. Long; Jason Bergerson; Jesse Chielowski; Jim Magill; Shine, Jim M (DNR); Joe Longo; John Martineck; Josh Kindred; Keith Lopez; Laney Vazquez; Lois Epstein; Longan, Sara W (DNR); Marc Kuck; Marcia Hobson; Steele, Marie C (DNR); Matt Armstrong; Melonnie Amundson; Franger, James M (DNR); Morgan, Kirk A (DNR); Umekwe, Maduabuchi P (DNR); Pat Galvin; Pete Dickinson; Peter Contreras; Rachel Davis; Richard Garrard; Richmond, Diane M; Robert Province; Ryan Daniel; Sandra Lemke; Pollard, Susan R (LAW); Talib Syed; Tina Grovier (tmgrovier@stoel.com); William Van Dyke Subject: Notice of Hearing - NorclAcl Energy, Inc. Applications for Reconsideration Attachments: CO 16-031 and CO 16-032 Oral Argument.pdf Please see attached. Jody J. Cotombie AOGCC Specia[Assistant Alaska Oiland(jas Conservation Commission 333 west 7`F .Avenue .anchorage, Alaska 99501 Office: (907) 793-1221 Fax: (907) 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 iodv.colombie®aloskagov. W BRENA, BELL & CLARKSON, P.C. 810 N Street, Suite 100 Anchorage, Alaska 99501 Phone: (901)258-2000 Facsimile: (901) 25&2001 RECEIVED EP 13 1:: STATE OF ALASKA AOGCC ALASKA OIL AND GAS CONSERVATION COMMISSION 333 West Seventh Avenue Anchorage, Alaska 99501 Re: Failure to Plug and Abandon Tiger Eye ) Central -1 (Permit No. 212-102) Before ) Termination of Owner's Rights in Oil ) and Gas Leases ADL 391104 and ) C-061677 Failure to Respond to Notice ) of Proposed Enforcement Action ) Docket No. OTH-16-032 APPLICATION FOR RECONSIDERATION RE SURETY BOND NordAq Energy, Inc. (NordAq), through its attorneys, Brena, Bell & Clarkson, P.C., applies for reconsideration of the Commission's Decision and Order (Decision) with respect to the requirement for a surety bond in the amount of $800,000. NordAq files this Application for Reconsideration pursuant to correspondence from the Commission granting NordAq's request for an extension of time.' The Decision requires NordAq to submit a surety bond in the amount of $800,000 and further states: "This bond will be returned to NordAq following permanent abandonment of Tiger Eye -I and clearance of well location. ,2 The work to plug and abandon the well is now complete, including clearance of the well location. The Commission's inspector has approved the work. NordAq is currently in the process of compiling chart data, graphs, and photos that will be included with the final P&A Sundry that NordAq will submit to the Commission. ( Letter Re Request for Extension of Time to File Application for Reconsideration, Docket No. OTH-16-032 (August 10, 2017). Decision and Order, Docket No. OTH-16-032 at 4 (July 20, 2017). Application for Reconsideration re Surety Bond Re. Failure to Plug Tiger Eye Central -1, Docket No. OTH-16-032 September 13, 2017 Page I of 2 BRENA, BELL & CLARKSON, P.C. 810 N Street, Suke loo Anchorage, Alaska 99501 Phone: W) M.W00 Facsimile: (9071 n&2001 Counsel for NordAq will provide the chart data, graphs, and photos to the Commission at oral argument on September 20, 2017. Completion of the work to plug and abandon Tiger Eye -1 negates the need for a surety bond. NordAq thus respectfully requests that AOGCC waive the requirement for a surety bond in the amount of $800,000. DATED this 13th day of September, 2017. BRENA, BELL & CLARKSON, P.C. Attorneys for NordAq Energy, Inc. Y Robin O. Brena, ABA No. 8410089 Anthony S. Guerriero, ABA No. 8509123 Laura S. Gould, ABA No. 0310042 Application for Reconsideration re Surety Bond Re. Failure to Plug Tiger Eye Central -I, Docket No. OTH-16-032 September 13, 2017 Page 2 of 2 17 THE STATE Alaska Oil and Gas ALASKA A Conservation Commission GOVERNOR BILL WALKER September 11, 2017 Robin O. Brena BRENA, BELL & CLARKSON, P.C. 810 N Street, Suite 100 Anchorage, AK 99501 Re: Docket Number OTH-16-031 and OTH 16-032 Oral Argument Applications for Reconsideration Dear Mr. Brena: 333 West Seventh Avenue Anchorage, Alaska 99501-3572 Main: 907.279.1433 Fax: 907.276.7542 www.00gcc.alaska.gov At the request of your office the Alaska Oil and Gas Conservation Commission has rescheduled the hearing on NordAq's Applications for Reconsideration for September 20, 2017 at 10:00 a.m. If you have any questions on this matter, please contact Ms. Jody Colombie Jody.colombie@alaska.gov or (907)793-1221. Sincerely, Cathy P Foerster Commissioner THE STATE GOVERNOR BILL WALKER August 16, 2017 Robin 0. Brena BRENA, BELL & CLARKSON, P.C. 810 N Street, Suite 100 Anchorage, AK 99501 Re: Docket Number OTH-16-031 and OTH 16-032 Applications for Reconsideration Dear Mr. Brena: Alaska Oil and Gas Conservation Commission 333 West Seventh Avenue Anchorage, Alaska 99501-3572 Main: 907.279.1433 Fax: 907.276.7542 www,aogcc.alaska.gov The Alaska Oil and Gas Conservation Commission (AOGCC) has received NordAq Energy, Inc.'s (NordAq) August 13, 2017 Applications for Reconsideration. The AOGCC has scheduled a hearing on NordAq's Applications for Reconsideration for September 19, 2017 at 10:00 a.m. If you have any questions on this matter, please contact Ms. Jody Colombie Jody.colombiena,alaska.gov or(907)793-1221. Sincerely, 12 Cathy �Foerster Commissioner im BRENA, BELL & CLARKSON, P.C. 810 N Street, Suite 100 a AnchoBe, Lska 99501 Phone: (907) 2584000 Facsimile: (902) 25&2001 STATE OF ALASKA RECEIVE® AUG 14 2011 ACGCC ALASKA OIL AND GAS CONSERVATION COMMISSION 333 West Seventh Avenue Anchorage, Alaska 99501 Re: Failure to Plug and Abandon Tiger Eye ) Central -1 (Permit No. 212-102) Before ) Termination of Owner's Rights in Oil ) and Gas Leases ADL 391104 and ) C-061677 Failure to Respond to Notice ) of Proposed Enforcement Action ) Docket No. OTH-16-032 REQUEST FOR ORAL ARGUMENT NordAq Energy, Inc., through its attorneys, Brena, Bell & Clarkson, P.C., requests oral argument on its Application for Reconsideration filed with this Commission on August 14, 2017. DATED this 14' day of August, 2017. BRENA, BELL & CLARKSON, P.C. Attorneys for NordAq Energy, Inc. By L14, � 1 6,cJ )" l Robin O. Brena, ABA No. 8410089 Anthony S. Guerriero, ABA No. 8509123 Laura S. Gould, ABA No. 0310042 Request for Oral Argument Re. Failure to Plug Tiger Eye Central -1, Docket No. OTH-16-032 August 14, 2017 Page 1 of 2 BRENA, BELL & CLARKSON, P.C. 810 N Street, Suite 100 Ancho .rye, Alaska 99501 Phone: (90]258-21000 Facsimile: (907) 258-2001 Certificate of Service The undersigned hereby certifies that a copy of the foregoing document was mailed to the following on the 14' day of August, 2017: Hollis French, Chair/Commissioner Daniel T. Seamount, Jr., Commissioner Cathy P. Foerster, Commissioner Alaska Oil and Gas Conservation Commission 333 West Seventh Avenue Anchorage, Alaska 99501 Request for Oral Argument August 14, 2017 Re. Failure to Plug Tiger Eye Central -1, Docket No. OTH-16-032 Page 2 of 2 BRENA, BELL & CLARKSON, P.C. 810 N Street, Suite 100 Anchorage, Alaska 99501 Phone: (907)258-2000 Facsimile: (907)258-2001 STATE OF ALASKA FIECEIVED AUG 0 4 2017 AOGCC ALASKA OIL AND GAS CONSERVATION COMMISSION 333 West Seventh Avenue Anchorage, Alaska 99501 Re: Failure to Plug and Abandon Tiger Eye ) Central -1 (Permit No. 212-102) Before ) Termination of Owner's Rights in Oil ) and Gas Leases ADL 391104 and ) C-061677 Failure to Respond to Notice ) of Proposed Enforcement Action ) Docket No. OTH-16-032 ENTRY OF APPEARANCE Brena, Bell & Clarkson, P.C. enters its appearance as attorneys for NordAq Energy, Inc. in the above -entitled action. Copies of all communications and filings herein shall be addressed to the following attorneys: Robin O. Brena, Esq. Anthony S. Guerriero, Esq. Laura S. Gould, Esq. Brena, Bell & Clarkson, P.C. 810 N Street, Suite 100 Anchorage, Alaska 99501 Telephone: (907) 258-2000 Facsimile: (907) 258-2001 E-mail: rbrena(2brenalaw.com E-mail: aguerrierona,brenalaw.com E-mail: 1 og uld(a,brenalaw.com DATED this 4' day of August, 2017. BRENA, BELL & CLARKSON, P.C. Attorneys for NordAq Energy, Inc. Y Robin O. Brena, ABA No. 8410089 Anthony S. Guerriero, ABA No. 8509123 Laura S. Gould, ABA No. 0310042 NordAq Entry of Appearance Re. Failure to Plug Tiger Eye Central -1, Docket No. OTH-16-032 August 4, 2017 Pagel of 2 BRENA, BELL & CLARKSON, P.C. 818 N Street, Suke 100 Anchoreee, Alaska 99501 Phone: (90](258-2000 Facsimile: (90](358-2001 Certificate of Service The undersigned hereby certifies that a copy of the foregoing document was e-mailed and mailed to the following attorneys/ parties of record on the 41h day of August, 2017: Hollis French, Chair/Commissioner Daniel T. Seamount, Jr., Commissioner Cathy P. Foerster, Commissioner Alaska Oil and Gas Conservation Commission 333 West Seventh Avenue Anchorage, Alaska 99501 Avonna L. Murfitt NordAq Entry of Appearance August 4, 2017 Re. Failure to Plug Tiger Eye Central -1, Docket No. OTH-16-032 Page 2 of 2 BRENA, BELL & CLARKSON, P.C. 810 N Street, Suite 100 Anchorage, Alaska 99501 Phone: I97) 259-2000 Facsimile: J907)258-2001 RECEIVED AUG 14 2017 STATE OF ALASKA AOGCC ALASKA OIL AND GAS CONSERVATION COMMISSION 333 West Seventh Avenue Anchorage, Alaska 99501 Re: Failure to Plug and Abandon Tiger Eye ) Central -1 (Permit No. 212-102) Before ) Termination of Owner's Rights in Oil ) and Gas Leases ADL 391104 and ) C-061677 Failure to Respond to Notice ) of Proposed Enforcement Action ) Docket No. OTH-16-032 APPLICATION FOR RECONSIDERATION NordAq Energy, Inc. (NordAq), through its attorneys, Brena, Bell & Clarkson, P.C., applies for reconsideration of the Decision and Order (Decision) issued in this matter by the Commission on July 20, 2017. The Decision is erroneous because it fails to sufficiently consider the facts of this particular case and applicable case law. PROCEDURAL BACKGROUND On May 24, 2017, the Commission sent a Revised Notice of Proposed Enforcement to NordAq.2 The Revised Notice modified the requirement of a check in the amount of $1,300,000 to a surety bond in that amount in the sole favor ofAOGCC .3 As a practical matter, This Application for Reconsideration is only with respect to the civil penalty. On August 10, 2017, AOGCC granted NordAq's request for extension of time to file an application for reconsideration, but only with respect to the bonding requirement. 2 Attachment A. The procedural history preceding the Revised Notice of Proposed Enforcement Action is set forth in the Decision at 1. 3 Attachment A at 3. Application for Reconsideration Re. Failure to Plug Tiger Eye Central -1, Docket No. OTH-16-032 August 14, 2017 Page 1 of 5 BRENA, BELL & CLARKSON, P.C. 810 N Street, Suite 100 Anchorage, Alaska 99501 Phone: (90])258-2000 Facsimile: (907)258-2001 however, NordAq is required to pay cash to obtain such a bond. The Revised Notice also reduced the civil penalty to $100,000.4 On June 8, 2017, NordAq timely responded to the Commission and indicated that NordAq did not concur with the proposed action and requested informal review. On June 12, 2017, the Commission responded to NordAq and indicated that all written submissions and a summary of any oral statements planned by NordAq should be provided to AOGCC no later than noon on June 22, 2017, in advance of informal review. NordAq timely submitted its summary of position and written submissions to AOGCC on June 22, 2017.5 On June 27, 2017, informal review took place at the Commission's office in Anchorage. On July 20, 2017, the Commission issued its Decision that is the subject of this Application for Reconsideration. ARGUMENT The Decision is erroneous because it fails to address mitigating factors that support a significant reduction in the civil penalty. Under AS 31.05.150(a), $100,000 is the maximum amount of a civil penalty for the initial violation. In its Decision, the Commission imposed a civil penalty of $100,000 "[a]fter application of the criteria set forth in AS 31.05.150(g)."' The Decision, however, contains no discussion whatsoever of the criteria in AS 31.05.150(g). Moreover, most of the criteria set forth in subsection (g) favor NordAq in this matter. 4 Attachment A at 3. 5 Attachment B. All exhibits referenced below are numbered exhibits that are included in Attachment B. 6 Attachment C at 4. Application for Reconsideration Re. Failure to Plug Tiger Eye Central -1, Docket No. OTH-16-032 August 14, 2017 Page 2 of 5 BRENA, BELL & CLARKSON, P.C. 010 N Street, Suite 100 Anchorage, Alaska 99501 Phone: (90))258-2000 Facsimile: (907) 258-2001 The following are mitigating factors under the relevant numbered criteria under AS 31.05.150(g): (1) NordAq acted in good faith when it suspended rather than plugged and abandoned Tiger Eye; (2) NordAq did not willfully commit the violation; (3) the violation is not serious and there is no threat to public health or the environment from the violation; (4) there is no injury to the public resulting from the violation; (5) NordAq derived no benefits from the violation; (6) NordAq does not have a history of noncompliance with the Commission; and (8) NordAq has made and continues to make efforts to correct the violation.' In a separate case involving ConocoPhillips, AOGCC considered similar mitigating factors and reduced the civil penalty by over 50 percent.$ Tiger Eye was suspended rather than plugged and abandoned because NordAq had an understanding with Cook Inlet Energy to take over the well for utility purposes.9 At the time of the informal review, NordAq was actively engaged in efforts to plug and abandon Tiger Eye and presented evidence of this to the Commission.10 The work to plug and abandon the well is now in progress." In addition, NordAq has consistently cooperated with AOGCC in this matter. By way of example, the Decision notes that "[a]fter the AOGCC noticed the public 7 See AS 31.05.150(g)(1)-(6), (8). Subsection (7) concerns "the need to deter similar behavior by the person committing the violation and others similarly situated at the time of the violation or in the future." 8 Attachment D, ConocoPhillips Alaska, Inc., as Operator of the Kuparuk River Unit; Kuparuk River Field; Well DRU ID -39 Enforcement Action, AOGCC Order No. 33 (May 20, 2005). 9 Attachment B, Exhibit 4. 10 Attachment B, Exhibit 1 and Exhibit 3 11 Attachment E at 2, ¶ 9. Application for Reconsideration Re. Failure to Plug Tiger Eye Central -1, Docket No. OTH-16-032 August 14, 2017 Page 3 of 5 BRENA, BELL & CLARKSON, P.C. 810 N Street, Suite 100 Anchorage, Alas" 99501 Phone: L907)258-2000 Facsimile: (907) 258-2001 hearing, NordAq contacted AOGCC with a proposed plan to plug and abandon Tiger Eye -1. AOGCC approved the plan on March 7, 2017."12 Since that time, NordAq has continued to cooperate with AOGCC in this matter. The Decision, however, contains no discussion of these mitigating factors with respect to the civil penalty imposed. NordAq maintains that a significant reduction in the civil penalty is warranted under the facts of this case. Based on the mitigating factors set forth above, NordAq respectfully requests that the Commission reduce the amount of the civil penalty to $10,000—commensurate with the facts of this case and the evidence supporting those facts. CONCLUSION The Decision erroneously fails to address mitigating factors in this case that support a significant reduction in the civil penalty in the maximum amount of $100,000. The Decision summarily refers to the criteria set forth in AS 31.05.150(g) as the basis for the penalty, but there is no discussion of those criteria as applied to this case. Nearly all of the criteria favor NordAq under the facts of this case. NordAq thus respectfully requests that the Commission reduce the civil penalty to $10,000—commensurate with the facts and the evidence in this case. 12 Attachment C at 1. Application for Reconsideration August 14, 2017 Re. Failure to Plug Tiger Eye Central -1, Docket No. OTH-16-032 Page 4 of 5 BRENA, BELL & CLARKSON, P.C. 810 N Street, Suite 100 Anchorage, Alaska 99501 Phoire: (902)258-2000 Facsimile: (907)258-2001 DATED this 14' day of August, 2017. BRENA, BELL & CLARKSON, P.C. Attorneys for NordAq Energy, Inc. Robin O. Brena, ABA No. 8410089 Anthony S. Guerriero, ABA No. 8509123 Laura S. Gould, ABA No. 0310042 Certificate of Service The undersigned hereby certifies that a copy of the foregoing document was mailed to the following attorneys/ parties of record on the 14'x' day of August, 2017: Hollis French, Chair/Commissioner Daniel T. Seamount, Jr., Commissioner Cathy P. Foerster, Commissioner Alaska Oil and Gas Conservation Commission 333 West Seventh Avenue Anchorage, Alaska 99501 Application for Reconsideration August 14, 2017 Re. Failure to Plug Tiger Eye Central -1, Docket No. OTH-16-032 Page 5 of 5 THE STATE GOVERNOR BILL WALKER May 24, 2017 CERTIFIED MAIL RETURN RECEIPT REQUESTED 7015 0640 0003 5185 5963 Robert Warthen, Senior Advisor NordAq Energy, Inc. 560 East 34th Avenue, Suite 200 Anchorage, AK 99503 Alaska Oil and Gas Conservation Commission 333 West Seventh Avenue Anchorage, Alaska 99501-3572 Main: 907.279.1433 Fax: 907.276.7542 www.aogcc.alaska.gov Re: Docket Number: OTH-16-032 Revised Notice of Proposed Enforcement Action Failure to Plug and Abandon Tiger Eye Central -I (PTD 212-102) Before Expiration of Owner's Rights in Oil and Gas Leases ADL 391104 and C-061677 Failure to Respond to Notice of Proposed Enforcement Action Dear Mr. Warthen: The Alaska Oil and Gas Conservation Commission (AOGCC) hereby notifies NordAq Energy Inc. (NordAq) of a revised proposed enforcement action. Nature of the Violation or Noncompliance (20 AAC 25.535(b)(1)). NordAq violated 20 AAC 25.105(a) by its failure to permanently abandon the Tiger Eye Central - 1 exploratory well (Tiger Eye -1) before expiration of NordAq's rights in oil and gas leases ADL 391104 and C-061677. Basis for Finding the Violation or Noncompliance (20 AAC 25.535(b)(2)). On September 4, 2012, NordAq was issued Permit to Drill No. 212-102 for the Tiger Eye -1 exploratory well. Tiger Eye 1 was drilled in 2012 and subsequently suspended. NordAq was the owner] of CIRI lease C-061677 and State of Alaska lease ADL 391104. The surface location for Tiger Eye I lies on acreage owned by Salarilatof Native Association Inc. A portion of the surface hole interval crosses oil and gas lease C-061677, and the bottom -hole location for the well lies within oil and gas lease ADL 391104. Tiger Eye -1 is located on the west side of Cook Inlet Basin and is only accessible during summer months. "Owner" means the person who has the rightto drill into and produce from spent and to appropriate the oil and gas the pennon produces from a pool for that person and others.' Person" includes a natural person, corporation, association, partnership, receiver, trustee, executor, administrator, guardian, fiduciary or other representative of any kind. and includes a departmenL agency or instrumentality of the state or a governmental subdivision of the state. ATTACHMENT A PAGE 1 of 4 Docket Number: OTH-16-032 May 24, 2017 Page 2 of 4 On October 14, 2016, the Alaska Department of Natural Resources (DNR) advised AOGCC that it had received, on January 27, 2016, NordAq's surrender of two State of Alaska oil and gas leases associated with the Tiger Eye Unit (leases ADL 391104 and ADL 391103). DNR approved the termination of the Tiger Eye Unit effective October 12, 2016. NordAq's rights in the two leases expired that same date. CIRI's lease C-061677 was terminated by CIRI effective July 1, 2015. (However, AOGCC did not learn of the lease termination until after issuance of the December 2, 2016 Notice of Proposed Enforcement Action.) In the event an operator defaults on its regulatory obligations to plug and abandon a well, the AOGCC looks to the landowner to fulfill those obligations. CIRI is the landowner' for lease C- 061677 and the DNR is the landowner of lease ADL 391104. NordAq violated 20 AAC 25.105(a) when it failed to properly plug and abandon Tiger Eye -I prior to termination of its rights in CIRI lease C-061677 and State lease ADL 391104. On December 2, 2016, the AOGCC sent to NordAq, via certified mail, a Notice of Proposed Enforcement Action that allowed NordAq a period of 90 days to either: • Submit a Sundry Application for the plugging and abandonment of the Tiger Eye -I and properly plug and abandon Tiger Eye -1; or • Submit a check in the amount of $1,300,000, which AOGCC estimates to be the cost to properly plug and abandon Tiger Eye -1. The Notice of Proposed Enforcement Action proposed two civil penalties for violating 20 AAC 25.105(a) and 20 AAC 25.535(b)(2): 1. $100,000 for the initial violation: failure to permanently abandon Tiger Eye -I before expiration of owner's rights in State lease ADL 391104; and 2. $50,000 for violating the requirement to plug and abandon and clear the well site to the satisfaction of the AOGCC as per 20 AAC 25.112 and 20 AAC 25.170 (50 days at $1,000 per day). On January 14, 2017, AOGCC noticed a public hearing for April 4, 2017 at 9:00 a.m. concerning NordAq's failure to permanently abandon Tiger Eye -1 and to respond to the Notice of Proposed Enforcement Action. On February 15, 2017, NordAq submitted a Sundry Application to permanently abandon Tiger Eye -1. On March 7, 2017, NordAq's Sundry Application to permanently abandon Tiger Eye -I Application was approved. At the April 4, 2017 public hearing, Robert Warthen of NordAq and John Easton of the Alaska Department of Natural Resources (DNR) testified. Mr. Warthen testified that: ' "Landowner" means the owner of the subsurfo:e estate of the net affected. ATTACHMENT A PAGE 2 of 4 Docket Number: 07H-16-032 May 24, 2017 Page 3 of 4 • Cook Inlet Energy, LLC had expressed interest in the Tiger Eye -1 well as a utility well. NordAq was notified in late October or early November 2016 that Cook Inlet Energy Inc. was no longer interested in utilizing the well. • NordAq plans to commence plugging and abandonment operations as early as June 2017. Operations may be delayed, however, if the well site location is within 600 feet of an active bald eagle nest. Under that scenario, operations would be delayed until mid-July 2017. • Plugging and abandonment operations are seasonal, as a barge is needed to move supplies to the remote West Foreland region. • NordAq's failure to respond to the Notice of Proposed Enforcement Action was due to a robbery at NordAq's office. Mr. Easton testified that NordAq has a $500,000 bond on file with DNR. The record closed at the end of the hearing. Proposed Enforcement Action (20 AAC 25.535(b)(3). Within 30 days of receipt of this letter, NordAq shall submit a surety bond for $1,300,000 issued on Form 10-402A in sole favor of the AOGCC by an authorized insurer under AS 21.09 whose certificate of authority is in good standing with the State of Alaska. This bond will be returned to NordAq following permanent abandonment of Tiger Eye -1 and clearance of well location. This bond shall be forfeited to the AOGCC if Tiger Eye -1 is not permanently abandoned and the well location is not cleared within one year of the date of this Enforcement Action. After consideration of the criteria set forth in AS 31.05.150(8), the AOGCC proposes to impose one civil penalty on NordAq for violating 20 AAC 25.105(a) and 20 AAC 25.535(b)(2): $100,000 for the initial violation of failure to properly abandon Tiger Eye 1 before expiration of owner's rights in State of Alaska oil and gas lease ADL 391104 and CIRI oil and gas lease C-061677. The total civil penalty is $100,000. Rights and Liabilities (20 AAC 25.535(b)(4)). Within 15 days after receipt of this notification — unless the AOGCC, in its discretion, grants an extension for good cause shown — NordAq may file with the AOGCC a written response that concurs in whole or in part with the proposed action described herein, requests informal review, or requests a hearing under 20 AAC 25.540. If a timely response is not filed, the proposed action will be deemed accepted by default. If informal review is requested, the AOGCC will provide NordAq an opportunity to submit documentary material and make a written or oral statement. If NordAq disagrees with the AOGCC's proposed decision or order after that review, it may file a written request for a hearing within 10 days after the proposed decision or order is issued. If such a request is not filed within that 10 -day period, the proposed decision or order will become final on the 11' day after it was issued. If such a request is timely filed, the AOGCC will hold its decision in abeyance and schedule a hearing. If NordAq does not concur in the proposed action described herein, and the AOGCC fmds that NordAq has violated a provision of AS 31.05, 20 AAC 25, or an AOGCC order, permit or other approval, then the AOGCC may take any action authorized by the applicable law including ATTACHMENT A PAGE 3 of 4 Docket Number: OTH-16-032 May 24, 2017 Page 4 of 4 ordering one or more of the following: (i) corrective action or remedial work; (ii) suspension or revocation of a permit or other approval; (iii) payment under the bond required by 20 AAC 25.025; and (iv) imposition of penalties under AS 31.05.150. In taking action after an informal review or hearing, the AOGCC is not limited to ordering the proposed action described herein, as long as NordAq received reasonable notice and opportunity to be heard with respect to the AOGCC's action. Any action described hereto or taken after an informal review or hearing does not limit the action the AOGCC may take under AS 31.05.160. Sincerely, C thy . F' oe ter Chair Commissioner cc: Andrew T. Mack, Commissioner, Department of Natural Resources, (via Certified Mail) Sophie Minich, CIRI President and CEO, Cook Inlet Region, Inc., (via Certified Mail) ATTACHMENT A PAGE 4 of 4 NORDAQ ENERGY, INC. June 8th, 2017 Cathy P. Foerster, Chau Alaska Oil and Gas Conversation Commission 333 West Seventh Avenue Anchorage, Alaska 99501-3572 Re: Docket Number: OTH-16-032 Revised Notice of Proposed Enforcement Action Failure to Plug and Abandon Tiger Eye Central -1 (PTD 212-102) Before Expiration of Owner's Rights in Oil and Gas Leases ADL 391104 and C-061677 Dear Ms. Foerster: This letter is NordAq's timely written response to the latter in this matter from the Alaska Oil and Gas Conversation Commission ("AOGCC") dated May 24, 2017. NordAq does not concur with the proposed action described in that letter and requests informal review. Consistent with that letter, NordAq will avail itself of the opportunity to submit documentary material and make a written or oral statement during that review. If NordAq disagrees with the AOGCC's proposed decision or order after that review, then NordAq intends to file a written request for a hearing within ten days after the proposed decision or order is issued. In the interim, NordAq respectfully requests a stay of the bonding requirement set forth in the letter referenced above. NordAq will submit evidence that the bonding requirement significantly exceeds the estimated cost to plug and abandon the Tiger Eye Central -1 well. In addition, as noted in the letter, NordAq already has a $500,000 bond on file with DNR. Sincerely, NORDAQ ENERGY C. By David f ffer Chief Financial Officer 560 East 34'" Avenue, i Suite 200 Anchorage, AK 99503 Main: 907.646.9315 Fax: 907.646.9317 I w .nordagenergy.com ATTACHMENT B PAGE 1 of 19 NorclAci Energy Tiger Eye #1 Plug and Abandon WELL NAME: Tiger Eye #1 POB Days: 21 OBJECTIVE: P&A Operating Days: 14 AFE #: TP&A0417 Total Days: 24 DATE: 5/1/2017 TOTAL: $666,602 EXPENSE CATEGORY TOTAL COMMENTS VENDOR Expense Subcategory - Permitting Permitting $ 22,000.00 AOGCC, Field Engineering PEI/ Sierra Hamilton Support and Personnel Communications $ 1,500.00 plug number AAO Management Personnel $ 59,640.00 30 days x 1988 AAO Company man $ 41,748.00 21 days x 1988 AAO Circulation pit $ 2,400.00 24 days x 100 AAO Surface rentals $ 10,000.00 sills, portable fuel tank, etc.. AAO Welding machine $ 2,000.00 2000 per month AAO Break shack $ 10,000.00 1200 per month Mag tech Excavator $ 3,100.00 3100 per month Airport Loader $ 17,500.00 17,500/ month AAO Generators $ 6,000.00 24 days x 250 (two gens) AAO Trucks $ 3,000.00 3 trucks x 1000/ month Mag tech Transportation Services Barging $ 20,000.00 4 loads x 5,000 Red Dog Dock call out $ 20,000.00 4 call outs x 5000 OSK Hilcorp call out $ 20,000.00 4 call outs x 5000, not verified Hilcorp Barge load out $ 4,800.00 4 loads x 1200 Weaver bros East side Trucking $ 5,000.00 4 days x 1250 Weaver bros West side trucking $ 15,680.00 8 Opr x 1460 +16 standby x 250 Weaver bros Air Charters $ 9,450.00 21 trips x 450 Kenai Aviation Location Preparation Pad labor Roustabouts $ 47,187.00 (1x 889 2x 679) x21 AAO Pad / Pit liner $ 5,000.00 Herculite DNOW Welding labor $ 3,896.00 4 days x 974 AAO Water Well, Tank, and Pumps $ 5,600.00 24 x 150, 2 days x 1000 M -W, Rain 4 rent Camp $ 36,750.00 0 x 175 per person 21 days, not verifiei Hilcorp Health, Safety and Environmental Safety and Compliance $ 21,105.00 1005 days x 21 AAO Waste Management Refuse Disposal $ 1,000.00 month rental and disposal Triangle recycling Septic Disposal $ 10,000.00 2 porta potties and disposal Isaacs Honey wagon Materials and Supplies Fuel $ 12,000.00 4000 gallons x $3 Doyle's Drilling Fluids $ 4,000.00 2 pallets Bentonite chips AK Mineral supply EXHIBIT 1 (NORDAQ) Page 7 of 2 ATTACHMENT B PAGE 2 of 19 NordAq Energy Tiger Eye #1 Plug and Abandon Slickline / Eline $ 42,941.00 7 runs, + 4 days crew standby x 1650, 7 days equipment standby 350, 3 days operating x 3040 Pollard Downhole Tools Plugs $ 2,400.00 3 CIBP's Pollard Perfs $ 3,750.00 3 x 1250 Pollard Cementing Services - P&A Dump bail $ 3,750.00 5 x 750 Pollard P&A $ 152,166.54 4 plugs Halliburton Subtotal: $ 625,364 Management fee $ 41,238.75 Cost+10% AAO TOTAL: $ 666,602 EXHIBIT 1 (NORDAQ) Page 2 of 2 ATTACHMENT B PAGE 3 of 19 STATE OF ALASKA ��g-' ALASKA OIL AND GAS CONSERVATION COMMISSION 2 ASSIGNMENT OF CERTIFICATE(S) OF DEPOSIT AND JAN 2.1 2011 CONFIRMATION AND AGREEMENT OF ISSUING W& On _._,g5, 2011 , itStt RtYa�Sr (Principal/ igor) �7 9350 Ne J1c Androu.a. Ak 44.so7 (Address) executed the following certificate(s) of deposit (Certificate(s)): 1. 96364634!i in the amount ofS 2004OW_� 2. in the amount of S to secure, in accordance with 20 AAC 25.025, any default that may occur under State of Alaska, Alaska Oil and Gas Conservation Commission (AOGCC) Personal Bond No. 4536963rl (Bond). WHEREAS, under 20 AAC 25.025, an operator submitting a personal bond on Form 10- 4026, must provide security, issued in the sole favor of the AOGCC, by a bank authorized to do business in the State of Alaska guaranteeing the operator's performance; NOW THEREFORE, to meet the requirements of 20 AAC 25.025, under this Assignment of Certificate(s) of Deposit and Confirmation and Agreement of Issuing Bank (Assignment), A. the Principal/Obligor agrees to the following: 1. it assigns its rights to the Cenificate(s) to the AOOCC; 2, the State of Alaska, by and through its duly authorized agents, is irrevocably constituted and appointed as its Attorney -in -Fact to do all things necessary to effectuate the purposes of this Assignment; and 3. this Assignment shall retrain in full force and effect until released in writing by the AOGCC in accordance with 20 AAC 25.025(c). B. The Issuing Bank confirms and agrees to the following: I . it is a bank authorized to do business in the Stale of Alaska; AOGCC — ASSIGNMENT OF CD(s) / CONFIRMATION/AGREEMENT (4%1004) Page I of 5 EXHIBIT 2A (NORDAQ) Page 1 of 6 ATTACHMENT B PAGE 4 of 19 2. it is federally insured or a Federal Reserve Bank branch; 3. it has changed its records to show that, subject to its compliance with all applicable State of Alaska and federal laws, only the AOGCC may collect the principal amount(s) of the Certificate(s); 4. it has placed a hard hold or freeze on the Certificate(s) in accordance with this Assignment; 5. it shall, within 3 business days after the Certificate(s) are issued, deliver the original Certificate(s)-or, if it does not issue original Certificate(s), other account documents, such as receipts, adequately showing that the Certificate(s) were issued—to the AOGCC (which shall hold them until this Assignment is released in writing by the AOGCC); 6. the Certificate(s) comply with the following requirements: (a) the principal of the Certificate(s) is/are in the sole favor and for the exclusive use of the AOGCC—i.e., the Certificate(s) will be held by the Issuing Band in trust for the AOGCC; (b) the Certificate(s) is/are assigned to the AOGCC in writing and upon the books of the Issuing Bank to secure any default, as determined by the AOGCC in its sole discretion, that may occur under the Bond, which accompanies the Certificate(s); (c) subject to the Issuing Bank's compliance with all applicable State of Alaska and federal laws, the AOGCC alone, in its sole discretion, shall authorize the release, in any fort, to any party of any or all of the principal amount(s) of the Certificate(s); (d) the Certificate(s) is/are, at any time prior to maturity, redeemable, and the principal amount(s) of the Certificate(s) is/are payable, in whole or in part at the AOGCC's sole discretion, to the AOGCC immediately upon the AOGCC's written demand; (e) the Certificate(s) is/are in such amount(s) that liquidation prior to maturity will result in the full amount of the Bond, or the Certificates) is/are issued with the provision that all costs of liquidation (including, for example, penalties for early redemption) will be paid out of the interest earned of the Principal/Obligor, not out of principal amount(s) of the Certificate(s); (t) the Certificate(s) is/are federally insured; (g) the Certificate(s) automatically renew; AOGCC – ASSIGNMENT OF CD(s) / CONFIRMATION/AGREEMENT (4/2009) Page 2 of 5 EXHIBIT 2A (NORDAQ) Page 2 of 6 ATTACHMENT B PAGE 5 of 19 (h) the Certificate(s) is/are subject to no expiration date that would restrict the right of the AOGCC to collect the principal amount of the Certificate(s) at any time of default; and (i) the Certificate(s) is/are not, and will not be, subject to any rights of set-off or liens of the Issuing Bank; and 7. the State of Alaska, by and through its duly authorized agents, is irrevocably constituted and appointed as its Attomey-in-Fact to do all things necessary to effectuate the purposes of this Assignment; 8. this Assignment shall remain in full force and effect until released in writing by the AOGCC in accordance with 20 AAC 25.025(c); and 9. it shall immediately notify the AOGCC and Principal/Obligor if it becomes unable, for any reason, to fulfil[ its obligations under the Certificate(s) or it it learns, or reasonably should have teamed, that any confirmation or agreement above is or becomes inaccurate. IN WITNESS WHEREOF, the Principal/Obligor has set its signature and seal (if it has one) Z ayofof PtincipaVAAObligo�r) iJ/r 4/ !A/ii(�iLit-��/ By: .-� Title: ). AzllA/ll IN WITNESS WHEREOF, the Issuing Bank has set its signature and seal (if "as one) this 2 7 dayof_� _.� 2 of t . (Signa ofIss Bank) By,. e- L�mor'S. Title: t s.,n"S AOGCC — ASSIGNMENT OF CD(s) / CONFIRMATION/AGREEMENT (4/2009) Page 3 of 5 EXHIBIT 2A (NORDAQ) Page 3 of 6 ATTACHMENT B PAGE 6of19 STATE OF ALASKA ) )ss. 3 JUDICIAL DISTRICT ) ACKNOWLEDGEMENT OF PRINCIPAL/OBLIGOR On this,' day of —TC 20 11 > before me, a notary public in and for the State of Alaska, duly commissioned and sworn, appeared to me personalty known, who, being by me duly swom, said the following: (I) he/she is qP�t � ctmiKAnIrmVL 7 of S' , the Principal/Obligor that executed the attached Assignment of Certificate(s) of Deposit and Confirmation and Agreement of Issuing Bank (Assignment); (2) the seal (if applicable) affixed to the Assignment is the Principal/Obligor's corporation seal; (3) the Assignment was signed and sealed (if applicable) on behalf of the Principal/Obligor by the authority of its Board of Directors; and (4) executing the Assignment is the free act and deed of the Principal/Obligor for the uses and purposes set forth in it. IN WITNESS WHEREOF, I have hereunto set my hand and official seal on the day, month, and year aforesaid. _=rNOTARY Notary Public in and for the State of Alaska \ PUBLIC My Commission Expires: ©2- L+- 2012-- AOGCC — ASSIGNMENT OF CD(s) / CONFIRMATION/AGREEMENT (4/2009) Page 4 of 5 EXHIBIT 2A (NOROAQ) Page 4 of 6 ATTACHMENT B PAGE 7of19 STATE OF ALASKA ) )ss. JUDICIAL DISTRICT ) ACKNOWLEDGEMENT OF ISSUING BANK On this` i Bay of JGLYILk__ -2of) before me, a notary public in and for the State of Alaska, duly commissioned and swam, appeared 5 C to me personally known, who, being by me duly(s�wom, said the following: (1) he/she is of C,• f V• , the Issuing Bank that executed the attached Assignment of Certificate(s) of Deposit and Confirmation and Agreement of Issuing Bank (Assignment); (2) the seal (if applicable) affixed to the Assignment is the Issuing Bank's corporation seal; (3) the Assignment was signed and sealed (if applicable) on behalf of the Issuing Bank by the authority of its Board of Directors; and (4) executing the Assignment is the free act and deed of the Issuing Bank for the uses and purposes set forth in it. IN WITNESS WHEREOF, 1 have hereunto set my hand and official seal on the day, month, and year aforesaid. (01(� 0 - f A R t Notary Public in and for the State of Alaska PUBLIC My Commission Expires: 02-' � - 1 Z AOGCC - ASSIGNMENT OF CD(s) / CONFIRMATION/AGREEMENT (412009) Page 5 of 5 EXHIBIT 2A (NORDAQ) Page 5 of 6 ATTACHMENT B PAGE 8 of 19 WELTS FA3:G0 Time Account Receipt/Disclosure Ranker Name Olfim/PordoloNumber: Date: ICHRISTIAN COSTELLO _ IF0605 01/25/2011 eatelphonc SweNulow.. Rarke,AU: Ranier MAC. - 1907/267 -5565 103902 10001061 IK3207-011 Customer/Account. Information primaryGntomrName: - Customer Number UNI: NORDAQ ENERGY INC. 1928506192336118 COID: pmmn: At otnt Number. Open Date: film Maurey, Date: 100569 ICDA 19636963911 101/25/2011 16 months 107/25/2011 Jim Aossalt Opedng Depose: Interest Rate: kmalPeraemage Yield: ReeARate: Variable Rate: Renewal Tam: [$200,000.00_ 1 0.20t_—J_0_20% IYes INO16 months InWeStwill bepaid: Tire metladdpaywitt eAp6r. EVERY 01 MONTHS AND AT WITHDRAWAL BY ADDING TO PRINCIPAL _ _ Rmewabpily. �OU WILL AUTOMATICALLY RENEW MY TIME ACCOUNT AT MATURITY UNLESS I NOTIFY YOU OTHERWISE Account Title and Mailing Information Custom(s) Listed on Account: Moping Address NORDAQ ENERGY INC. 9350 NORDIC ST IITF: ALASKA OIL AND GAS pity; Stan [CONSERVATION COMMISSION ANCHORAGE 1AK ZIP/Postal Code: fw^VY: I--_ _ 1199507-6035 IUS This is arascipt. It need not be presented 4 the time you obtain payment from the Rank. W50168 (I 1-10 SV%) ATTACHMENT B PAGE 9 of 19 Page t or t EXHIBIT 2A (NORDAQ) Page 6 of 6 November 6, 2012 THE STATE Department of Natural Resources 01ALASKA D, V ISION of oil & G;; Anchorage Ofrir, P. P.kOR $1. !J Pdh;Je =0z. YCi 2.i y5C5S Nordaq Energy Inc. Attn: Robert Warthen 3000 A street, Suite 410 Anchorage, AK 99503. RE: Nordaq Energy Inc. Statewide Oil and Gas Lease Bond Dear Mr. Warthen: The Statewide Oil and Gas Bond submitted by Nordaq Energy, Inc. in the foam of a Certificate of Deposit with Wells Fargo Bank (Account # 9422389560) in the amount of $500,000 under the control of the State of Alaska is hereby accepted 09/17/2012 under 11 AAC 83.160. The Bank has agreed to not alter or cancel the Certificate of Deposit without the State's concurrence and the Certificate of Deposit is subject to the following conditions: 1. The State of Alaska may require additional financial security as necessary. 2. Nordaq Energy Inc. Does hereby irrevocably constitute and appoint the State of Alaska, Department of Natural Resources, Division of Oil and Gas by and through its authorized agents and Attorney -in Fact as Beneficiary of the Certificate of Deposit. 3. Nordaq Energy Inc. agrees that only the State of Alaska, Department of Natural Resources, division of Oil and Gas, upon written notice shall cause the transfer of any and all funds in the Certificate of Deposit referenced above. The statewide bond satisfies all the bond requirements to which an oil and gas lease is subject under the Department of Natural Resources. All oil and gas bonds must comply with 11 AAC 82.600. Thank you for providing the Certificate of Deposit to satisfy the Statewide Oil and Gas bond requirements. If you have any questions, contact David Edmunds at 907-269-8769 or email him at david edmundsnoalaska e . Sincerely, Kim Kruse Petroleum Land Manager ATTACHMENT B PAGE 10 of 19 EXHIBIT 2B (NORDAQ) Page 1 of 6 cc. Rachelle Burnett Business Relationship Manager 1351 E. Huffrnan Road Suite 201 Anchorage, Alaska Jeremy Vance Wells Fargo Bank 301 W. Northern Lights Blvd., Suite 100 Anchorage, Alaska 99503 EXHIBIT 211 (NORDAQ) Page 2 of 6 ATTACHMENT B PAGE 11 of 19 Form DOGiPCU-01 October 2011 Fik No. _ STATE OF ALASKA DEPARTMENT OF NATURAL RESOURCES EQEn!JD1 DMSION OF OIL AND GAS [RI:) AUG 2 u STATEWIDE OIL AND GAS BOND DIVISION OF ALL MEN BY THESE PRESENTS that we,©fC AND GAS as principal, atvna , whose address is as surety, are held and firmly bound unto the State of Alaska in the `sum of FIVE HUNDRED THOUSAND DOLLARS ($500,000.00), lawful money of the United States for the use and benefit of (1) the State of Alaska, (2) any owner of a portion of the land subject to the coverage of this bond who has a statutory right to compensation in connection with a reservation of the oil and gas deposits to the State of Alaska, and (3) any lessee or permittee under a lease or permit issued by the State of Alaska prior to the issuance of an oil or gas lease for same land subject to this bond, covering the use of the surface or the prospecting for or development of other mineral deposits in any portion of such land, to be paid to the State of Alaska. For such payment, well and truly to be made, we bind ourselves and each of us and each of our heirs, executors, administrators, successors and assigns, jointly and severally by these presents. THE CONDITIONS of the foregoing obligations are such that, WHEREAS: A. The principal in one or more of the following ways has an interest in oil and gas leases on lands of the State of Alaska under the jurisdiction of the Department of Natural Resources: (]) as the lessee of such leases, (2) as the approved holder of operating rights in all or part of the lands covered by such leases under operating agreements with the lessee, and (3) as designated operator or agent under such leases pending approval of an assignment or operating agreement; and, B. The principal is authorized to drill for, explore for, develop, produce, process, and market oil and gas deposits in or under the lands covered by such leases and is obligated to comply with certain covenants and agreements set forth in such leases; and, C. The principal and surety agree that the coverage of this bond shall extend to all of the principal's holdings under such leases in the State of Alaska, and without notice to the surety shall also extend to and include: 1. Any such oil and gas lease hereafter issued to or acquired by the principal, the coverage to become effective immediately upon such issuance or upon approval by the State of Alaska of a transfer in favor of the principal; and, EXHIBIT 2B (NORDAQ) Page 3 of 6 ATTACHMENT B PAGE 12 of 19 2. Any such operating agreement hereafter entered into or acquired by the principal, the coverage to become effective immediately upon approval by the State of Alaska of the agreement or of a transfer of such an agreement to the principal; and, 3. Any designation hereafter or the principal as operator or agent of a lessee under such a lease, the coverage to become effective immediately upon the filing of such a designation with the State of Alaska; and, 4. Any extension of a lease covered by this bond, such coverage to continue without any interruption due to the expiration of the term set forth in the lease; Provided however, that the surety may elect to have additional coverage authorized under this Paragraph C, to become inapplicable as to all interests of the principal acquired more than 30 days after the receipt of written notice of such election by the Division of Oil and Gas; and, D. The surety hereby waives any right to notice of, and agrees that this bond shall remain in full force and effect notwithstanding: I . A transfer or transfers, either in whole or in part, of any or all of the leases or of the operating agreements, and further agrees to remain bound under this bond as to the interests, either in the leases or in the operating agreements or in both, retained by the principal when the approval of the transfer or transfer becomes effective; and, 2. Any modification of a lease or operating agreement or obligations thereunder whether made or effected by commitment of such lease or operating agreement to unit, cooperative, communitization, or storage agreements, or development contracts, suspensions of operations or production, waivers, suspensions or changes in rental, minimum royalty and royalties, compensatory royalty payments, or otherwise; and, E. The principal and surety agree that notwithstanding the termination of any lease or leases, operating agreements, or designations as operator or agent covered by this bond, whether the termination, in part or wholly is by operation of law or otherwise, the bond shall remain in full force and effect as to all remaining leases, operating agreements, or designations covered by this bond; and, F. The principal, as to any lease or part of a lease for lands as to which he has been designated as operator or agent or approved as operator in consideration of being permitted to furnish this bond in lieu of the lessees, agrees and by these presents does hereby bind himself to fulfill on behalf of each lessee al I the obligations of each such lease for the entire leasehold in the same manner and to the same extent as though he were the lessee; and, G. The principal and surety agree that the neglect or forbearance of the lessor, in enforcing against the lessees of such lessor the payment of rentals or royalties or the performance of any other covenant, conditions, or agreement of the leases, shall not in any way release the principal and surety, or either of them, from any liability under this bond; and, EXHIBIT 20 (NORDAQ) Page 4 of 6 ATTACHMENT B PAGE 13 of 19 H. The principal and surety agree that, in the event of any default under the leases, the lessor may commence and prosecute any claim, suit, action, or other proceeding against the principal and surety or either of them without the necessity of joining the lessees. NOW THEREFORE, if said principal shall in all respects faithfully comply with all of the provisions of the leases referred to hereinabove, then the above obligations are to be void; OTHERWISE. to remain in full force and effect. APPROVAL AND ACCEPTANCE BY THE STATE OF ALASKA By:Dated: Department ``ofNlatural Resources, Division of Oil and Gas INSTRUCTIONS: 1. The surety on the bond may be any corporation qualified to issue performance and reclamation bonds in the State of Alaska. 2. If the principals are partners, their individual names shall appear in the spaces provided, with recital that they are partners comprising a firm, naming it, and all members of the partnership shall execute the bond as individuals. 3. Where this bond is executed by a corporation, either as surety or as principal, the bond must be executed by a duly autborized officer, and the individual signing must submit evidence of their authority to act for the corporation. 4. When any party executes this bond through an agent, a power of attorney or other evidence of authority must accompany this bond. EXHIBIT 213 (NORDAQ) Page 5 of 6 ATTACHMENT B PAGE 14 of 19 Swth Anchorage Business Banking MAC K3211-020 1351 E. Huffman Aoed Suite 201 Anchorage, AK 99515 September 17, 2012 State of Alaska RE: Certificate of Deposit To Whom It May Concern: This letter is to inform you that Nordaq Energy, Inc. has one (1) Certificates of Deposit (CD) with Wells Fargo Bank, N.A. The CD listed below are located at branch 6759 (1351 E Huffman Ste 202 Anchorage, AK 99515). Account Amount Maturity Date 9422389560 $500,000 01/31/2013 The above listed certificate of deposit is under the control of The State of Alaska. The Bank will not alter of cancel the certificate of deposit without the State's concurrence. Release of funds to the beneficiary, Nordaq Energy, Inc., is dependent upon the State's written instruction. The certificate of deposit is set to renew automatically. Please feel free to contact me at 907-348-5367 with any questions or concerns. Sincerely, p Rachelle Burnett Business Relationship Manager ATTACHMENT B PAGE 15 of 19 Together we'll go far EXHIBIT 213 (NORDAQ) Page 6 of 6 ALASKA OIL AND GAS CONSERVATION COMMISSION DOCKET NUMBERS OTH-16-031 AND OTH 16-032 AFFIDAVIT OF PETER M. DICKINSON RE STATUS OF WORK TO PLUG AND ABANDON TIGER EYE. CENTRAL -1 AND SHADURA-1 WELLS STATE OF TEXAS ) ) SS. COUNTY OFs_ } PETER M. DICKINSON, being first duly sworn upon his oath, deposes and states: I am the President of All American Oilfield, LLC ("All American"), a limited liability company based in Kenai, Alaska. 2. I have been involved in work for NordAq Energy, Inc. ("NordAq") on the Tiger Eye Central -I well ("Tiger Eye") and the Shadura-1 well ("Shadura") since their inception, and All American drilled both of the wells. 3. All American is the general contractor for NordAq for the work to plug and abandon Tiger Eye and Shadura. 4. All American has contracts or agreements with all of the vendors listed on the NordAq authorization for expenditure to plug and abandon Tiger Eye, which is in a total amount of $666,602. [Exhibit 1 to NordAq's First Supplemental Response to Revised Notice of Proposed Enforcement Action re Tiger Eye] 5. All American cannot begin work to plug and abandon Tiger Eye before August 1, 2017, because the necessary camp on the West side of Cook Inlet is currently in use and will not be available prior to that time. EXHIBIT 3 (NORDAQ) Page 1 of 2 ATTACHMENT B PAGE 16 of 19 6. NordAq is also waiting for a few State permits before it can begin the work to plug and abandon Tiger Eye. All American currently plans to begin the work to plug and abandon Tiger Eye after the necessary camp becomes available and after the remaining permits are obtained. The work is expected to last approximately 21 days. 8. All American has contracts or agreements with all of the vendors listed on the NordAq authorization for expenditure to plug and abandon Shadura, which is in a total amount of $483,826. [Exhibit 1 to NordAq's First Supplemental Response to Revised Notice of Proposed Enforcement Action re Shadura] 9. All American cannot begin the work to plug and abandon Shadura until there is approximately one foot of frost and one foot of snow in the area, because it is necessary to build a snow trail to the well in the absence of any existing roads. 10. With the approval of AOGCC, NordAq may try to plug and abandon Tiger Eye and Shadura consecutively in an effort to decrease costs and increase efficiency, DATED this ;2 1_ day of June, 2017. PETER . DIM CON SUBSCRIBED AND SWORN TO before me this' -2 /3 -f. -day of June, 2017. NGEMVGONZALEZ ?z'; °4; -Notary Publlo, 6Sot0 0 Texas ,• Comm. Expires 01+39+2D70 otary Public in ancffor Texas NOW ID 129096991 My Commission Expires: 002-,0/8� EXHIBIT 3 (NORDAQ) Page 2 of 2 ATTACHMENT B PAGE 17 of 19 ALASKA OIL AND GAS CONSERVATION COMMISSION DOCKET NUMBERS OTH-16-031 AND OTH 16-032 AFFIDAVIT OF STEPHEN F. HENNIGAN RE NORDAQ'S EFFORTS TO PLUG AND ABANDON TIGER EYE CENTRAL -1 AND SHADURA-1 WELLS STATE OF ALASKA ) ) ss. THIRD JUDICIAL DISTRICT ) states: STEPHEN F. HENNIGAN, being first duly sworn upon his oath, deposes and 1. I am a project engineer and I work through and for Sierra Hamilton, LLC, of which my former company, Petroleum Engineers, Inc., has become a part. 2. I was contracted by NordAq to prepare and submit drilling permits, weekly and final reports, sundries, etc., to State agencies, primarily AOGCC, in the drilling of NordAq-operated Shadura-1 (PTD No. 211-014 ) ("Shadura") and Tiger Eye Central -1 (PTD No. 212-102) ("Tiger Eye"). 3. I was integrally involved with the preparation and submittal of the end -of - well sundries for the above wells—for Shadura Sundry 312-001, for Tiger Eye Sundry 313-239. 4. I have met with and had numerous telephone and email discussions with the AOGCC staff on behalf of NordAq in discussing Sundry data. 5. I have been integrally involved in submitting final data to the AOGCC via the required 10-407 forms and format on both wells. EXHIBIT 4 (NORDAQ) Page 1 of 2 ATTACHMENT B PAGE IS of 19 6. Shadura-1 was suspended rather than plugged and abandoned at that time, as it was intended that NordAq would drill a second Shadura well and use Shadura-1 as a sidetrack candidate or for other utility purposes. 7. Tiger Eye was secured rather than plugged and abandoned at that time because, in my understanding, NordAq had an understanding with Cook Inlet Energy to take over the well for utility purposes. 8. I have prepared and submitted to the AOGCC sundries for plugging and abandonment of both wells, which have been approved: a. Shadura - 317-027 b. Tiger Eye - 317-083 9. I have been contracted by NordAq to provide engineering services and interaction efforts in the abandonment of Shadura and Tiger Eye. In addition, I am to supply daily, weekly, and final reports, as required by the AOGCC, to them. DATED this �� day of June, 2017. TEPHEN F. HENNIGAN AND SWORN TO before me this?, day of June, 2017. }i 441 Ro`tary Public in and for Alaska My Commission Expires: 3 a� 2 EXHIBIT 4 (NOROAQ) Page 2 of 2 ATTACHMENT B PAGE 19 of 19 STATE OF ALASKA ALASKA OIL AND GAS CONSERVATION COMMISSION 333 West Seventh Avenue Anchorage, Alaska 99501 Re: Failure to Plug and Abandon Tiger Eye ) Other Order No. 122 Central-] (Permit No. 212-102) Before ) Docket No. OTH-16-032 Termination of Owner's Rights in Oil and ) July 20, 2017 Gas Leases ADL 391104 and C-061677 ) Failure to Respond to Notice of Proposed ) Enforcement Action ) DECISION AND ORDER On December 2, 2016, the Alaska Oil and Gas Conservation Commission (AOGCC) issued a Notice of Proposed Enforcement Action (Notice) to NordAq Energy Inc. (NordAq) regarding Tiger Eye Central -1 exploratory well (Tiger Eye -1). The Notice was based upon NordAq's failure to permanently abandon Tiger Eye -1 before expiration of NordAq's rights in leases through which Tiger Eye-] is drilled: State of Alaska lease ADL 391104 and Cook Inlet Region, Inc. (CIRI) lease C-061677. The termination of NordAq's rights in ADL 391104 was effective October 12, 2016. The CIRI lease was terminated effective July 1, 2015. (AOGCC did not learn of the termination of the CIRI lease until after issuance of the December 2, 2016, Notice.) The Notice proposed specific corrective actions and a $150,000 civil penalty under AS 31.05.150(a). The Notice also proposed that NordAq provide a check in the amount of $1,300,000, AOGCC's projected cost to plug and abandon Tiger Eye -1 if NordAq did not uphold its obligation to do so. NordAq failed to respond to the Notice. The AOGCC scheduled a public hearing for April 4, 2017, at 10:00 a.m. On January 14, 2017, the AOGCC published a public notice for that hearing in the ALASKA DISPATCH NEWS. After the AOGCC noticed the public hearing, NordAq contacted AOGCC with a proposed plan to plug and abandon the Tiger Eye -1. AOGCC approved that plan on March 7, 2017. The public hearing was held on April 4, 2017. NordAq appeared and presented evidence. Summary of Revised Prouosed Enforcement Action After the hearing, on May 24, 2017, the AOGCC issued a Revised Notice of Proposed Enforcement Action (Revised Notice) regarding Tiger Eye -l. The Revised Notice changed the requirement of ATTACHMENT C PAGE 1 of 5 a check for $1,300,000 to a bond in that amount in the sole favor of the AOGCC and lowered the civil penalty to $100,000. The Revised Notice specified that the bond would be forfeited if Tiger Eye -1 had not been permanently plugged and abandoned and the well location cleared within one year of the date of the Revised Notice. The bond was to be due within 30 days of the Revised Notice. NordAq requested an informal review. That review was held at the AOGCC offices on June 27, 2017. Preliminary Findings On September 4, 2012, AOGCC issued Permit to Drill No. 212-102 for Tiger Eye -1. Tiger Eye -1 was drilled in 2012 and subsequently suspended. NordAq was the owner of CIRI lease C-061677 and State of Alaska lease ADL 391104. The surface location for Tiger Eye -1 lies on acreage owned by Salamatof Native Association Inc. A portion of the wellbore crosses CIRI lease C- 061677. The bottom -hole location lies within ADL 391104. Tiger Eye -1 is located on the west side of Cook Inlet Basin and is only accessible during summer months. On October 14, 2016, DNR advised AOGCC that the termination of the Tiger Eye Unit on October 12, 2016, was the effective date of the termination of NordAq's rights in ADL 391104. CIRI lease C-061677 was terminated effective July 1, 2015. NordAq does not dispute that the Tiger Eye -1 was not properly plugged and abandoned at the time of the expiration of NordAq's rights in those leases. NordAq has violated 20 AAC 25.105(a). Mitigating Circumstances Presented by the Operator At the public hearing on April 4, 2017 and the informal review on June 27, 2017, NordAq offered the following in mitigation of its noncompliance: NordAq's delay was due in part to its attempt to negotiate transfer of Tiger Eye -1 to Cook Inlet Energy (CIE) after termination of the CIRI lease; ATTACHMENT C PAGE 2 of 5 CIE informed NordAq around July 2016 that it was not interested in assuming responsibility for the Tiger Eye -1 well; Tiger Eye -I is only accessible during summer months; NordAq's failure to respond to the initial Notice was due to a robbery that occurred at NordAq's offices; NordAq's effort to start work to plug and abandon Tiger Eye -1 in June 2017 has been delayed until August 1, 2017, due to Chevron's use of dock on west side of Cook Inlet; The delay in plugging and abandoning the well after termination of these oil and gas leases resulted in no hydrocarbon leakage, well integrity problems, or other problems other than a time delay; Tiger Eye -I well site has road access from Cook Inlet dock area. As a result, the expense of reaching Tiger Eye -1 is less than contemplated by AOGCC's $1,300,000 bond; and Salamantof Native Corporation (surface estate owner) wants the existing road and pad left in place. Additional Findings NordAq failed to properly plug and abandon Tiger Eye -I and clear the well site in accordance with AOGCC's regulatory requirements prior to termination of its rights in the leases upon which Tiger Eye -1 is sited. Following termination of leases C-061677 and ADL 391104, NordAq did not notify the AOGCC or discuss Tiger Eye -1 with the AOGCC. NordAq failed to respond to the initial Notice. Bonds on file with other State agencies cannot be appropriated by the AOGCC. ATTACHMENT C PAGE 3 of 5 Conclusions The surety bond must reflect all costs that will be incurred by the State in the event NordAq defaults on its regulatory obligations to plug and abandon Tiger Eye -1 and clear the well site. Because Tiger Eye -1 well site has road access, construction and use of an ice road for plugging and abandonment operations are not required, thus lowering the total cost estimate to bring Tiger Eye -1 into compliance, and in turn, the amount of the bond required. Now Therefore It Is Ordered That: After application of the criteria set forth in AS 31.05.150(g) to the matters set forth above, NordAq shall pay a civil penalty of $100,000 for violating 20 AAC 25.105(a) by failing to permanently abandon Tiger Eye -1 before expiration of its rights in State of Alaska oil and gas lease ADL 391104 and CIRI oil and gas lease C-061677. The total civil penalty is $100,000. In addition, within 30 days of receipt of this letter, NordAq shall submit a surety bond for $800,000 issued on Form 10-402A in the sole favor of the AOGCC by an authorized insurer under AS 21.09 whose certificate of authority is in good standing with the State of Alaska. This bond will be returned to NordAq following permanent abandonment of Tiger Eye -1 and clearance of well location. This bond shall be forfeited to the AOGCC if Tiger Eye -1 is not permanently plugged and abandoned and the well location cleared within one year of the date of this Decision and Order. As an Operator involved in an enforcement action, you are required to preserve documents concerning the above action until after resolution of the proceeding. Done at Anchorage, Alaska and dated July 20, 2017. ATTACHMENT C PAGE 4 of 5 //signature on file// Hollis S. French Chair, Commissioner //signature on file// Daniel T. Seamount, Jr Commissioner AND APPEAL NOTICE //signature on file// Cathy P. Foerster Commissioner 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 atter it is filed. Failure to act on it within 10 -days is a denial of reconsideration. If the AOOCC 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 ATTACHMENT C PAGE 5 of 5 STATE OF ALASKA ALASKA OIL AND GAS CONSERVATION COMMISSION 333 West Seventh Avenue, Suite 100 Anchorage Alaska 99501-3539 Re: ConocoPhillips Alaska, Inc., as Operator of the ) Kuparuk River Unit; Kuparuk River Field; ) Well KRU 1 D-39 Enforcement Action ) AOGCC Order No. 33 May 20, 2005 DECISION AND ORDER On March 31, 2005, the Alaska Oil and Gas Conservation Commission issued a Notice of Proposed Enforcement Action under 20 AAC 25.535(b), stating that it considered that ConocoPhillips Alaska, Inc. ("CPAI") may have violated provisions of regulation 20 AAC 25.402 and Area Injection Order No. 2B in connection with operating well Kuparuk River Unit ("KRU") 1D-39. The Commission proposed civil penalties under AS 31.05.150(a) in the total amount of $53,250, as well as specified corrective actions. Pursuant to CPAI's request for informal review under 20 AAC 25.535(c), CPAI met with the Commission on May 11, 2005. CPAI also provided by electronic mail written material referred to as "key points" for discussion at the May 11, 2005 meeting. A. Summary of Proposed Enforcement Action In its Notice of Proposed Enforcement Action, the Commission identified an apparent violation by CPAI of Rule 7 of Area Injection Order No. 2B ("AIO 213") and regulation 20 AAC 25.402 by failing to timely report a well integrity failure that occurred on August 24, 2004, by failing to obtain Commission approval of a plan of corrective action, and by failing to obtain Commission approval to continue injection. ATTACHMENT D PAGE 1 of 6 AOGCC Order #33 I ") May 20, 2005 Page 2 of 6 The Commission proposed to order the following corrective actions by CPAI: (1) that within 30 days after the effective date of the enforcement order, CPAI correct deficiencies in its surveillance program; and (2) that within 30 days after the effective date of the enforcement order, CPAI provide the Commission with new protocols established to insure the timely identification and reporting of injection well mechanical integrity failures. In addition, the Commission proposed the following civil penalties under AS 31.05.150(a): (i) $5,000 for violating reporting requirements in AIO 2B, Rule 7 and 20 AAC 25.402(f); (ii) $5,000 for violating corrective action plan requirements in AIO 213, Rule 7; and (iii) $250 per day for each 173 days for violating requirements for obtaining approval to continue injecting in AIO 2B, Rule 7 from August 25, 2005 through February 13, 2005, inclusive. The total of the proposed civil penalties was $53,250. B. Surveillance and Reporting Requirements for Injectors Commission requirements for demonstrating and monitoring mechanical integrity of injection wells are documented in regulation 20 AAC 25.402, and specifically for KRU in Area Injection Order 2B. CPAI does not dispute the facts of the case and acknowledges that KRU 1D- 39 did point out the existence of a gap in their annular pressure monitoring and surveillance program. However, CPAI raised several concerns about the proposed enforcement action: (1) the Notice of Proposed Enforcement Action references 173 days that had passed between leak initiation and observation; CPAI believes only 171 days passed; ATTACHMENT D PAGE 2 of 6 AOOCC Order #33 I Page 3 of 6 May 20, 2005 (2) the Notice of Proposed Enforcement Action does not accurately reflect that CPAI reported tubing/annulus communication in KRU 1D-39 to the Commission within 1 day following leak observation, and voluntarily self -disclosed that 171 days had passed between leak initiation and observation; and (3) the circumstances surrounding KRU 1D-39 are not the same as previous well integrity enforcements, warranting a different response than the Commission applied in this case. The Commission agrees that language in the notice does not accurately reflect the fact that CPAI self-reported the tubing/annulus communication in this injection well. We also agree that the correct interval between leak observation and reporting was 171 days, not 173 days, as determined from the pressure trends and data provided with CPAI's initial notice of well integrity failure. The circumstances CPAI alludes to were clarified in the May 11, 2005, informal meeting. CPAI stated that the significant differences were in the self -reporting of the well integrity failure and in the risk represented by the well integrity failure. The Commission does agree that, based on the evidence presented subsequent to the commencement of this review, KRU 1 D-39 was not ever in danger of annulus overpressure or misinjection of fluids (fluids remained confined to the wellbore and the injection zone). However, the fact remains that the clear regulatory requirements for well integrity were violated, and CPAI does not dispute that fact. As acknowledged by CPAI, reliance on the allowable thresholds for development well annular pressures as provided by Conservation Order 494 ("CO 494") is not appropriate for injection wells, since the Commission has clearly established different and more stringent regulatory requirements for injectors. ATTACHMENT D PAGE 3 of 6 AOOCC Order #33 Page 4 of 6 C. Workine Relationship May 20, 2005 CPAI expressed concerns that this enforcement action does little to improve well integrity, that it simply "adds strain" to the close and open working relationship that CPAI has endeavored to create with the Commission, particularly in the area of complex well integrity issues. The Commission recognizes CPAI's efforts to work well integrity issues collaboratively with the Commission. However, that collaborative work relationship between the regulatory agency (Commission) and the regulated community (CPAI) does not negate the Commission's clear mandate for enforcement when rules are violated. Of particular concern to the Commission is the fact that the Commission had questioned CPAI personnel about their internal well operating guidelines, and more specifically, the treatment of injection wells as if they were governed by production well integrity rules several times prior to this incident [beginning with the publication of Conservation Order 494 for public comment on June 30, 2003 effective date of CO 494 was September 4, 2003.] D. Corrective Actions In previous enforcement actions, the Commission has identified five factors that should be considered in determining appropriate penalties. These include: (1) the good or bad faith of the operator in violating the law; (2) the injury to the public resulting from the violation; (3) the benefits derived by the operator from its violation; (4) the operator's ability to pay any penalty; and (5) the need to deter similar behavior by the operator and others in the future. In addition, the Commission has considered the operator's voluntary remedial responses subsequent to the occurrence of a violation. ATTACHMENT D PAGE 4 of 6 AOGCC Order #33 Page 5 of 6 May 20, 2005 Several mitigating factors appear applicable in the present situation. First, the Commission acknowledges the good faith of CPAI throughout this investigation. Particularly noteworthy was the voluntary self -disclosure that 171 days passed between leak initiation and observation. In considering the injury to the public or environment resulting from the violation, the Commission is convinced that the risks during the 171 days of operation were minimal. Because of the low injection pressures, fluids being injected (water), and well design (multiple casing strings with pressure ratings exceeding injection pressure available to contain pressure communication or leakage), there was never any danger of annulus overpressure and no misinjection of fluids. The Commission also recognizes that CPAI has instituted corrective actions to improve compliance with applicable regulations and orders. These actions were instituted on CPAI's own initiative immediately following the identification of a gap in the annular pressure monitoring and surveillance program. F. Findings and Conclusions For the reasons stated above, the Commission finds that CPAI violated Area Injection Order 2B, Rule 7, and regulation 20 AAC 25.402(f). To deter future violations by any operator, the Commission concludes that civil penalties are called for and that the corrective actions set out below should be ordered. The Commission further concludes that because of CPAI's self - reporting and self -disclosure, cooperation throughout the investigation, and absence of substantial risk associated with the violations, the penalty amount originally proposed should be significantly reduced. ATTACHMENT D PAGE 5of6 AOGCC Order #33 May 20, 2005 Page 6 of 6 NOW THEREFORE IT IS ORDERED THAT: 1. CPAI shall pay to the Commission a civil penalty in the amount of $25,000 within 30 days after the date this Decision and Order becomes final; 2. CPAI shall comply with the following corrective actions within 30 days from the date this Decision and Order becomes final: a. CPAI shall provide the Commission with a detailed description of actions completed to correct deficiencies in the annular pressure monitoring and surveillance program. CPAI shall also identify any remaining actions and the timeframe for completion. b. CPAI shall provide the Commission with a description of its new protocols established to ensure the timely identification and reporting of injection well mechanical integrity failures. 3. This Decision and Order becomes final on the 11th day after the date of its issuance shown below, unless within 10 days after the date of issuance CPAI files a written request for a hearing under 20 AAC 25.535(d). If CPAI timely files a written request for a hearing this Decision and Order will be of no effect. Done at May, 2005. Daniel T. Seamount, Jr., Commissioner Cathy Poeister, Commissioner ATTACHMENT D PAGE 6 of 6 BRENA, BELL & CLARKSON, P.0 810 N Street, SWta 100 Mchomp, Alaska 99501 Ph ... :)909)258-2000 Facsimile: (90))258-2001 STATE OF ALASKA ALASKA OIL AND GAS CONSERVATION COMMISSION 333 West Seventh Avenue Anchorage, Alaska 99501 Re: Failure to Plug and Abandon Tiger Eye ) Central -1 (Permit No. 212-102) Before ) Termination of Owner's Rights in ) Oil and Gas Leases ADL 391104 ) And C-061677 Failure to Respond to ) Notice of Proposed Enforcement ) Action ) Docket No. OTH-16-032 AFFIDAVIT OF ROBERT C. WARTHEN IN SUPPORT OF APPLICATION FOR RECONSIDERATION STATE OF ALASKA ) ) ss. THIRD JUDICIAL DISTRICT ) ROBERT C. WARTHEN, being first duly sworn upon oath, deposes and states: 1. I am a Senior Advisor for NordAq Energy, Inc. (NordAq). 2. On June 22, 2017, NordAq submitted documentary material to the Commission that included an authorization for expenditure for Shadura-1 (Shadura), which indicated the total estimated cost to plug and abandon the well is $483,826.1 On the same day, NordAq submitted documentary material to the Commission that included an authorization for expenditure for Tiger Eye Central -1 (Tiger Eye), which indicated the total estimated cost to plug and abandon the well is $666,602.2 Attachment B, Exhibit 1 to Application for Reconsideration re Shadura. Attachment B, Exhibit 1 to Application for Reconsideration re Tiger Eye. Affidavit of Robert C. Warthen Re. Failure to Plug Shadura-1, Docket No. OTH-16-031 ATTACHMENT Pagel of 3 BRENA, BELL & CIARKSON, P.C. 810 N Shee4 SuOe 100 MchmBe, Alk. 99501 Ph..: (907)158-1000 F.W.1k: (W7)ZS-3001 3. The total estimated cost to plug and abandon Shadura is less than the total estimated cost to plug and abandon Tiger Eye for the reasons discussed below. 4. Shadura is located in the east side of Cook Inlet, close to an established road system and other infrastructure, while Tiger Eye is located in a remote part of the west side of Cook Inlet. Transportation services, location preparation, and labor -related costs are thus less expensive for Shadura than for Tiger Eye because there is less trucking, no barging, and no camp required for Shadura. 5. Slickline/Eline costs are less for Shadura than for Tiger Eye because Shadura is a straight well, Tiger Eye is a deviated well, and Shadura has fewer perforations than Tiger Eye. 6. Cementing services are less expensive for Shadura than for Tiger Eye for the same reasons that slickline/eline costs are less for Shadura than for Tiger Eye. 7. NordAq also has unused cement from previous jobs that it can use to plug and abandon Shadura, which reduces the amount and cost of cement that NordAq will need to purchase to complete the work to plug and abandon the well. 8. These cost differences are reflected in the respective authorizations for expenditure for Shadura and for Tiger Eye. 9. The work to plug and abandon Tiger Eye is currently in progress, and NordAq expects to complete the work by the end of the month or shortly thereafter. 10. Once the work to plug and abandon Tiger Eye is complete, NordAq expects to recover a $500,000 bond in favor of the State that NordAq obtained when it unitized Tiger Eye. 11. NordAq plans to use those funds to obtain security for Shadura. Affidavit of Robert C. Warthen Re. Failure to Plug Shadura-1, Docket No. OTH-16-031 Page 2 of 3 ATTACHMENT E BRENA, BELL & CLARKSON, P.C. 810 NSb et, Suite 100 Anchorage, Meeh 99501 Shore: (90])]59.1000 F.W.11e: (9 )858-2001 12. If required to submit the surety bond for $1,200,000, NordAq would be requires to provide the full amount of $1,200,000 to obtain the bond rather than provide a much smaller percentage of the full amount to obtain the bond. DATED this 14'x' day of August, 2017. SUBSCRIBED AND SWORN TO before me this 14')' day of August, 2017. r Notary Public in and for Alaska A1C vr` My Commission Expires: C5 17/ affidavit of Robert C. Warthen ie. Failure to Plug Shadura-1, Docket No. OTH-16-031 ATTACHMENT ! Page 3 of 3 15 THE STATE °fALASKA GOVERNOR BILL WALKER David Pfeiffer Chief Financial Officer August 10, 2017 Alaska Oil and Gas Conservation Commission Certified Mail Return Receipt Requested . 7015 0640 0003 5185 6021 NordAq Energy, Inc. 560 East 34'h Avenue, Suite 200 Anchorage, AK 99503 Re: Docket No. OTH- 16-032 Other Order No. 122 Request for Extension of Time to File Application for Reconsideration Dear Mr. Pfeiffer: 333 West Seventh Avenue Anchorage, Alaska 99501-3572 Main: 907.279.1433 Fax: 907.276.7542 www.aogcc.olaska.gov NordAq Energy, Inc.'s August 4, 2017 request for an extension of time to file an Application for Reconsideration of the portion of Other Order No. 122 that required a surety bond in the amount of $800,000 is granted. The revised due date for an Application for Reconsideration is September 13, 2017. Sincerely, LtQ97\-- Hollis S. French Chair, Commissioner cc: Robin O. Brena, Esq., Brena, Bell & Clarkson, P.C, (via email) Anthony S. Guerriero, Esq., Brena, Bell & Clarkson, P.C. (via email) Laura S. Gould, Esq., Brena, Bell & Clarkson, P.C. (via email tf1%o a 9 .0 Certified Mail Fee a Ln $ 560 E. 34th Ave., Ste. 200 U.S. Postal Service" C3 ❑Retumnecelpttelec ,o r3 CERTIFIED C3 MAIL° RECEIPT O Adult Signature Re &ed Dellvel O Postage ? $ r3 Total Postage and Fee, 0 Registered MailR ❑ Registered Mail Restdctedl Domestic Mail Only r-3 a Delivery elleturn Receipt for O For delivery M1 Merchandise Al-lu Numtmr flrnr; iM, "m.Re",Ajahell 0 Collect on Delivery Reetricted Delivery ❑Signature Confirmation"" 7015 0640 0003 5185 6021 information, visit our website at www.usps.comi tf1%o a 9 .0 Certified Mail Fee a Ln $ 560 E. 34th Ave., Ste. 200 Extra services & Fees fcrraok rrl OReWM RagelPt (hardcopy) C3 ❑Retumnecelpttelec ,o r3 O Certified Mall Restricted Delivery C3 i] Adult Signature Required �) O Adult Signature Re &ed Dellvel O Postage ? $ r3 Total Postage and Fee, 0 Registered MailR ❑ Registered Mail Restdctedl 9590 9401 0057 5071-0132 60 sear To r-3 a Delivery elleturn Receipt for O 8treeieriOApl. No., orP[Jeuxi M1 Merchandise $ P k $ He. RBfe David Pfeiffer Chief Financial Officer NordAq Energy, Inc. 560 E. 34th Ave., Ste. 200 Anchorage, AK 99503 ■ Complete items 1, 2, and 3. ■ Print your name and address on the reverse so that we can return the card to you. ■ Attach this card to the back of the mailpiece or on the front if space permits. David Pfeiffer REC Chief Financial Officer NordAq Energy, Inc. AU 560 E. 34th Ave., Ste. 200 III'IIIII Anchorage, AK 99503 Ad 0 Agent 0 Adore by (Printed `Vame)' C. D. Is delive address different from Rem 1? QYw, VEEPr delivery address below: ❑ No 2017 3. Service Type fiWntlSignatyre 12PriorityMail Express® i III'IIIII I'II III II II�IIIIIIIII �) 111111111111 2:1t Signature Restricted! Delivery 0 Registered MailR ❑ Registered Mail Restdctedl 9590 9401 0057 5071-0132 60 ertifled Mail® v D Certified Mail Restrioi6d plelivery Delivery elleturn Receipt for 0 Collect on Delivery I Merchandise Al-lu Numtmr flrnr; iM, "m.Re",Ajahell 0 Collect on Delivery Reetricted Delivery ❑Signature Confirmation"" 7015 0640 0003 5185 6021 ured Mal :uretl Mail Restricted Delivery ❑ Signature Confirmation Restricted Delivery $500) PS Form 3811, April 2015 PSN 7530-02-000-9053 Domestic Return Receipt . Colombie, Jody J (DOA) From: Colombie, Jody J (DOA) Sent: Thursday, August 10, 2017 2:50 PM To: Igould@brenalaw.com Subject: FW: Extension of Time Attachments: SKM_C454e17081014560.pcif Please find the attached response to your Request for Extension of Time to File Application for Reconsideration. Jody J. Colombie AOGCC Specia(Assistant Alaska Oi(andGas Conservation Commission 333 }'Vest 7'fi Avenue Anchorage, Alaska 99501 Office: (907) 793-1221 _Tax. (907) 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). If 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' Lodv.colombie@aloska.aov. Colombie, Jody J (DOA) From: Colombie, Jody J (DOA) Sent: Thursday, August 10, 2017 2:48 PM To: rbrena@brenalaw.com; aguerriero@brenalaw.com; Igoul@brenalaw.com Subject: Extension of Time Attachments: SKM_C454e17081014560.pdf Please find the attached response to your Request for Extension of Time to File Application for Reconsideration. Jody J. Co(ombie .AOgCC Specia.(Assistant .A(aska Oi(andgas Conservation Commission 333 West 7'F .Avenue .Anchorage,.A(aska 99501 Office: (907) 793-1221 -Tax: (907) 276-7542 CONFIDENr1AMY 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.coIL)mbie@alaska.gov. 14 BRENA, BELL & CLARKSON, P.C. 810 N Street, Suite 100 Anchorage, Alaska 99501 Phone: (907)258-2000 Facsimile: (90]2511-2001 RECEIVE® AUG 0 4 2011 AOGCC STATE OF ALASKA ALASKA OIL AND GAS CONSERVATION COMMISSION 333 West Seventh Avenue Anchorage, Alaska 99501 Re: Failure to Plug and Abandon Tiger Eye ) Central -1 (Permit No. 212-102)Before ) Termination of Owner's Rights in Oil ) and Gas Leases ADL 391104 and ) C-061677 Failure to Respond to Notice ) of Proposed Enforcement Action ) Docket No. OTH-16-032 REQUEST FOR EXTENSION OF TIME TO FILE APPLICATION FOR RECONSIDERATION NordAq Energy, Inc. (NordAq), through its attorneys, Brena, Bell & Clarkson, P.C., requests an extension of time within which to file an application for reconsideration of the Decision and Order (Decision) issued by the Commission on July 20, 2017. The Decision and Order requires that an application for reconsideration must be filed within twenty days after written notice of the entry of the order or decision, "or such further time as the AOGCC grants for good cause shown." I The Commission ordered that NordAq must submit a surety bond for $800,000 within thirty days of receipt of the Decision .2 The bond would thus be due by August 23, 2017. NordAq, however, plans to begin the work to plug and abandon Tiger Eye Central -1 (Tiger Eye) on August 7, 2017, and anticipates that the work will take approximately twenty-one days I Decision and Order, Docket No. OTH-16-032 at 5 (July 20, 2017). 2 Decision and Order at 4. Request for Extension of Time Re. Failure to Plug Tiger Eye Central -1, Docket No. OTH-16-032 August 4, 2017 Pagel of 3 BRENA, BELL& CLARKSON, P.C. 810 N Street, Suite 100 Anchorage, Alaska 99501 Phone: (90))258-2000 Facsimile: (90))2582001 to complete.' Thus, completion of the work to plug and abandon the well will occur close to the time that the surety bond would be due. Completion of the work will negate the need for a surety bond, which will also negate an application for reconsideration of the Decision with respect to the bonding requirement. In addition, NordAq has paid $410,000 of the estimated total cost of $666,602 to plug and abandon Tiger Eye. This is well over half of the estimated total cost to plug and abandon the well. NordAq has also appropriated the funds to pay the remaining balance of $256,602.5 NordAq will pay half of the remaining balance of $256,602 by August 16, 2017, and the remaining balance of $128,301 by August 21, 2017.6 Thus, financing for the work to plug and abandon the well is not at issue. Finally, NordAq would be required to provide the full amount of $800,000 to obtain the surety bond rather than provide a much smaller percentage of the full amount to obtain the bond .7 NordAq has limited resources, and this would divert those resources away from the goal to plug and abandon Tiger Eye before the end of this month. Therefore, NordAq respectfully requests a thirty -day extension of time within which to file an application for reconsideration to allow for completion of the work to plug and abandon the well. The revised due date for an application for reconsideration would be September 13, 2017. Exhibit A, Affidavit of David P. Pfeiffer in Support of Request for Extension of Time. Exhibit A. 5 Exhibit A. 6 Exhibit A. 7 Exhibit A. Request for Extension of Time Re. Failure to Plug Tiger Eye Central -1, Docket No. OTH-16-032 August 4, 2017 Page 2 of 3 BRENA, BELL & CLARKSON, P.C. 810 N Street, Suite 100 Anchorage, Alasica 99501 Phone: (90](258-2000 Facsimile: (901)258-2001 DATED this 41 day of August, 2017. BRENA, BELL & CLARKSON, P.C. Attorneys for NordAq Energy, Inc. By �14__ V 6�1 1 . u . Robin O. Brena, ABA No. 8410089 Anthony S. Guerriero, ABA No. 8509123 Laura S. Gould, ABA No. 0310042 Certificate of Service The undersigned hereby certifies that a copy of the foregoing document was e-mailed and mailed to the following attorneys/ parties of record on the 4' day of August, 2017: Hollis French, Chair/Commissioner Daniel T. Seamount, Jr., Commissioner Cathy P. Foerster, Commissioner Alaska Oil and Gas Conservation Commission 333 West Seventh Avenue Anchorage, Alaska 99501 Avonna L. Murfitt� Request for Extension of Time .August 4, 2017 Re. Failure to Plug Tiger Eye Central -1, Docket No. OTH-16-032 Page 3 of 3 BRENA, BELL & CLARKSON, P.C. 810 N street, suite Ino Anchorage, Alaska 99501 Phone: (90])358-1000 Faulmlle: (90])3582001 RECEIVED AUG 0 4 2017 A0G00 STATE OF ALASKA ALASKA OIL AND GAS CONSERVATION COMMISSION 333 West Seventh Avenue Anchorage, Alaska 99501 Re: Failure to Plug and Abandon Tiger Eye ) Central -1 (Permit No. 212-102) Before ) Termination of Owner's Rights in Oil ) and Gas Leases ADL 391104 and ) C-061677 Failure to Respond to Notice ) of Proposed Enforcement Action ) Docket No. OTH-16-032 AFFIDAVIT OF DAVID P. PFEIFFER IN SUPPORT OF REQUEST FOR EXTENSION OF TIME STATE OF ALASKA ) ) ss. THIRD JUDICIAL DISTRICT ) David Pfeiffer, being first duly sworn upon oath, deposes and states: 1. I am the Chief Financial Officer for NordAq Energy, Inc. (NordAq). 2. NordAq plans to begin the work to plug and abandon Tiger Eye Central -1 (Tiger Eye) on August 7, 2017. 3. NordAq anticipates that the work will take approximately twenty-one days to complete. 4. NordAq has paid $410,000 of the estimated total cost of $666,602 to plug and abandon the well. 5. NordAq has appropriated the funds to pay the remaining balance of $256,602. 6. NordAq will pay half of the remaining balance of $256,602 by August 16, 2017. 7. NordAq will pay the remaining balance of $128,301 by August 21, 2017. Affidavit of David P. Pfeiffer Re. Failure to Plug Tiger Eye Central -1, Docket No. OTH-16-032 Pagel of 2 8. If required to submit the surety bond for $800,000, NordAq would be required to provide the full amount of $800,000 to obtain the bond rather than provide a much smaller percentage of the full amount to obtain the bond. DATED this 34 day of August, 2017. P. PFEIFFER SUBSCRIBED AND SWORN TO before me this � day of August, 2017. sy_ Notary Public in and for Alaska l/C ``` My Commission Expires: �l Certificate of Service The undersigned hereby certifies that a copy of the foregoing document was e-mailed and mailed to the following attorneys/ parties of record on the day of August, 2017: Hollis French, Chair/Commissioner Daniel T. Seamount, Jr., Commissioner Cathy P. Foerster, Commissioner Alaska Oil and Gas Conservation Commission 333 West Seventh Avenue Anchorage, Alaska 99501 BRENA, BELL & C: (X7)N, P.C. \` ----Z 810 N Street, Suite 100 Anchorage,Alaska 99501 Phone: (X7) 25&2000 Facsimile: (90])35&2001 Avonna L. Murfitt Affidavit of David P. Pfeiffer Re. Failure to Plug Tiger Eye Central -1, Docket No. OTH-16-032 Page 2 of 2 RECEIVED AUC 0 8 2017 STATE OF ALASKA AOGCC ALASKA OIL AND GAS CONSERVATION COMMISSION 333 West Seventh Avenue Anchorage, Alaska 99501 Re: Failure to Plug and Abandon Tiger Eye ) Central -1 (Permit No. 212-102) Before ) Docket No. OTH-16-032 Termination of Owner's Rights in Oil ) and Gas Leases ADL 391104 and ) C-061677 Failure to Respond to Notice ) of Proposed Enforcement Action ) AFFIDAVIT OF DAVID P. PFEIFFER IN SUPPORT OF REQUEST FOR EXTENSION OF TIME STATE OF ALASKA ) ) ss. THIRD JUDICIAL DISTRICT ) David Pfeiffer, being first duly sworn upon oath, deposes and states: 1. I am the Chief Financial Officer for NordAq Energy, Inc. (NordAq). 2. NordAq plans to begin the work to plug and abandon Tiger Eye Central -1 (Tiger Eye) on August 7, 2017. 3. NordAq anticipates that the work will take approximately twenty-one days to complete. 4. NordAq has paid $410,000 of the estimated total cost of $666,602 to plug and abandon the well. BRENA, BELL& 5. NordAq has appropriated the funds to pay the remaining balance of $256,602. CLARKSON, P.C. 810 N Street, Sui[e 100 Aruhom{e,Fiaaka 89501 Phone: (90]) 12 6. NordAq will pay half of the remaining balance of $256,602 by August 16, 2017. Facsimile: (907) 128-20058-A0 1 7. NordAq will pay the remaining balance of $128,301 by August 21, 2017. Affidavit of David P. Pfeiffer Re. Failure to Plug Tiger Eye Central -1, Docket No. OTH-16-032 Page 1 of 2 EXHIBIT A 8. If required to submit the surety bond for $800,000, NordAq would be required to provide the full amount of $800,000 to obtain the bond rather than provide a much smaller percentage of the full amount to obtain the bond. DATED this Smoot day of August, 2017. P. PFEIFFER SUBSCRIBED AND SWORN TO before me this 34,/— day of August, 2017. �A lies 4 _+= Notary Public in and for Alaska 1C My Commission Expires: Certificate of Service The undersigned hereby certifies that a copy of the foregoing document was e-mailed and mailed to the following attorneys/ parties of record on the day of August, 2017: Hollis French, Chair/Commissioner Daniel T. Seamount, Jr., Commissioner Cathy P. Foerster, Commissioner Alaska Oil and Gas Conservation Commission 333 West Seventh Avenue Anchorage, Alaska 99501 BRENA, BELL & CLARKSON, P.C. 810 N Street, Suite 100 Anchoage, Alaska 99501 Phone: (90))258-2000 Facsimile: (907)258-3001 Avonna L. Murfitt Affidavit of David P. Pfeiffer Re. Failure to Plug Tiger Eye Central -1, Docket No. OTH-16-032 Page 2 of 2 13 BRENA, BELL & CLARKSON, P.C. 810 ra street, suns 100 Anchorape, Alaska 99501 Phone: (907) M-2000 Facsimile: (907) 258-2001 RECEIVED AUG 0 8 2017 A0GCG STATE OF ALASKA ALASKA OIL AND GAS CONSERVATION COMMISSION 333 West Seventh Avenue Anchorage, Alaska 99501 Re: Failure to Plug and Abandon Tiger Eye ) Central -1 (Permit No. 212-102) Before ) Termination of Owner's Rights in Oil ) and Gas Leases ADL 391104 and ) C-061677 Failure to Respond to Notice ) of Proposed Enforcement Action ) Docket No. OTH-16-032 ENTRY OF APPEARANCE Brena, Bell & Clarkson, P.C. enters its appearance as attorneys for NordAq Energy, Inc. in the above -entitled action. Copies of all communications and filings herein shall be addressed to the following attorneys: Robin O. Brena, Esq. Anthony S. Guerriero, Esq. Laura S. Gould, Esq. Brena, Bell & Clarkson, P.C. 810 N Street, Suite 100 Anchorage, Alaska 99501 Telephone: (907)258-2000 Facsimile: (907) 258-2001 E-mail: rbrena@brenalaw.com E-mail: aguerrierokbbrenalaw.com E-mail: lgould(a,brenalaw.com DATED this 41 day of August, 2017. BRENA, BELL & CLARKSON, P.C. Attorneys for NordAq Energy, Inc. LM LCL/ , 1\, � VL�� Robin O. Brena, ABA No. 8410089 Anthony S. Guerriero, ABA No. 8509123 Laura S. Gould, ABA No. 0310042 NordAq Entry of Appearance Re. Failure to Plug Tiger Eye Central -1, Docket No. OTH-16-032 August 4, 2017 Pagel of 2 BREVA, BELL & CLARKSON, P.C. 810 N Street, Sulte 100 Anchorage, Alaska 99501 Phone: (901(35&3000 Facsimile: (90](258-2001 Certificate of Service The undersigned hereby certifies that a copy of the foregoing document was e-mailed and mailed to the following attorneys/ parties of record on the 41 day of August, 2017: Hollis French, Chair/Commissioner Daniel T. Seamount, Jr., Commissioner Cathy P. Foerster, Commissioner Alaska Oil and Gas Conservation Commission 333 West Seventh Avenue Anchorage, Alaska 99501 Avonna L. Murfitt NordAq Entry of Appearance August 4, 2017 Re. Failure to Plug Tiger Eye Central -1, Docket No. OT14-16-032 Page 2 of 2 12 STATE OF ALASKA ALASKA OIL AND GAS CONSERVATION COMMISSION Docket No. OTH-16-031 and OTH-16-032 INFORMAL REVIEW June 27, 2017 at 10:00 am NAME AFFILIATION Testify (yes or no) 11 N(--)RDAQ 1:=NL':RGY, INC. June 22, 2017 HAND DELIVERED Ms. Cathy P. Foerster, Chair Alaska Oil and Gas Conversation Commission 333 West Seventh Avenue Anchorage, Alaska 99501-3572 Re: Docket Number: OTH-16-032 RECEIVED JUN 2 2 2017 AGC Revised Notice of Proposed Enforcement Action Failure to Plug and Abandon Tiger Eye Central -1 (PTD 212-102) Before Expiration of Owner's Rights in Oil and Gas Leases ADL 391104 and C-061677 Dear Ms. Foerster: In accordance with your letter dated June 12, 2017, NordAq submits this summary of its position in this matter and all accompanying documentary material. With respect to the requirement for a surety bond, NordAq assumes the requirement is not in effect because it is part of the proposed enforcement action to which NordAq timely responded. NordAq respectfully requests that AOGCC reconsider the bonding requirement, and submits the following facts and attached documentary material to support these facts. 1. The amount of the bond significantly exceeds the estimated cost to plug and abandon the Tiger Eye Central- l well ("Tiger Eye"). Attached as Exhibit 1 is NordAq's authorization for expenditure to plug and abandon the well, which is in a total amount of $666,602. This is slightly over half the proposed amount of the surety bond. S60 E. 34" Avenue, Anchorage, AK Fax: Suite 200 99503 -, Main: 907.646.9315 r www.nordagenergy.com 907.646.9317 NORDAQ LNERG"' , !NC_. Ms. Cathy P. Foerster June 22, 2017 Page 2 2. NordAq currently has a Personal Bond in the amount $200,000 on file with AOGCC, and a Statewide Oil and Gas Bond in the amount of $500,000 on file with the Department of Natural Resources ("DNR"). Attached as Exhibit 2 are documents to demonstrate the existence and extent of these bonds. NordAq believes these bonds are applicable to the plugging and abandonment work that remains to be done. 3. NordAq is currently working with a general contractor and subcontractors to do the work necessary to plug and abandon the well. The work will begin after August 1, 2017, and will take approximately twenty-one days to complete. Attached as Exhibit 3 is an affidavit from the general contractor, Peter M. Dickinson of All American Oilfield, LLC, to attest to these facts. NordAq would appreciate your consideration of these facts with respect to its request for AOGCC to reconsider the bonding requirement. To the extent the State wants a surety bond to protect against the risk of NordAq failing to plug and abandon Tiger Eye, NordAq is actively moving forward to plug and abandon the well as quickly as possible (see Affidavit of Stephen F. Hennigan referenced below). In addition, NordAq currently has significant bonds on file with the State of Alaska that are designed to protect the State in the unlikely event of NordAq's failure to perform its obligations with respect to the well. NordAq is concerned that AOGCC's proposed level of bonding will divert valuable company resources such that it will detract from the goal to plug and abandon the well as quickly as possible. NordAq believes the foregoing facts are sufficient to justify no additional bonding. With respect to the proposed civil penalty, NordAq maintains that it should not be subject to the penalty under the facts of this case. Tiger Eye was secured rather than plugged and abandoned earlier because NordAq had an understanding with Cook Inlet Energy to take over the well for utility purposes. Attached as Exhibit 4 is an affidavit from of Stephen F. Hennigan, who was involved with the preparation and submittal of the end -of -well sundry for Tiger Eye, to attest to this. NordAq was discussing alternative uses of the well with Cook Inlet Energy until late 2016. Cook Inlet Energy, however, did not take over the well. 3000 A Street, Suite Anchorage, AK Main: I Fax. 410 99503907.646.9315 I 907.646.9317 www.n,rdagenergy.com N(.=)KD,,'\Q EINE-KC,Y; INC. Ms. Cathy P. Foerster June 22, 2017 Page 3 In addition, NordAq has cooperated with AOGCC in this matter by timely submitting a Sundry Application to permanently plug and abandon Tiger Eye as required by the original Notice of Proposed Enforcement Action dated December 2, 2016. As noted in the Revised Notice of Proposed Enforcement Action dated May 24, 2017, AOGCC approved that application. NordAq would appreciate your consideration of these facts with respect to the proposed civil penalty. NordAq reasonably believed that Cook Inlet Energy would take over Tiger Eye for utility purposes, and NordAq has made a good -faith effort to cooperate with AOGCC. NordAq is again concerned that AOGCC's proposed penalty will divert valuable company resources such that it will detract from the goal to plug and abandon the well as quickly as possible. NordAq believes the foregoing facts are sufficient to justify no civil penalty. In the alternative, NordAq requests that AOGCC stay the bonding requirement and proposed civil penalty until September 30, 2017, at which time NordAq anticipates that the work on Tiger Eye will be complete. If the work is complete at that time, NordAq requests that the Commission waive the bonding requirement and proposed civil penalty. NORDAQ ENERGY, . By David Pfeiffer Chief Financial Officer Enclosures 3000 A Street, Suite Anchorage, AK Main: Fax: 410 99503 1 907.646.9315 907.646.9317 www.nordaqenergy.com j NordAq Energy Tiger Eye #1 Plug and Abandon WELL NAME: Tiger Eye #1 POB Days: 21 Aft OBJECTIVE: P&A Operating Days: 14 AFE #: TP&A0417 Total Days: 24 DATE: 5/1/2017 TOTAL: $666,602 EXPENSE CATEGORY TOTAL COMMENTS VENDOR Expense Subcategory Permitting Permitting $ 22,000.00 AOGCC, Field Engineering PEI/ Sierra Hamilton Support and Personnel Communications $ 1,500.00 plug number AAO Management Personnel $ 59,640.00 30 days x 1988 AAO Company man $ 41,748.00 21 days x 1988 AAO Circulation pit $ 2,400.00 24 days x 100 AAO Surface rentals $ 10,000.00 sills, portable fuel tank, etc.. AAO Welding machine $ 2,000.00 2000 per month AAO Break shack $ 10,000.00 1200 per month Mag tech Excavator $ 3,100.00 3100 per month Airport Loader $ 17,500.00 17,500/ month AAO Generators $ 6,000.00 24 days x 250 (two gens) AAO Trucks $ 3,000.00 3 trucks x 1000/ month Mag tech Transportation Services Barging $ 20,000.00 4 loads x 5,000 Red Dog Dock call out $ 20,000.00 4 call outs x 5000 OSK Hilcorp call out $ 20,000.00 4 call outs x 5000, not verified Hilcorp Barge load out $ 4,800.00 4 loads x 1200 Weaver bros East side Trucking $ 5,000.00 4 days x 1250 Weaver bros West side trucking $ 15,680.00 8 Opr x 1460 +16 standby x 250 Weaver bros Air Charters $ 9,450.00 21 trips x 450 Kenai Aviation Location Preparation Pad labor Roustabouts $ 47,187.00 (1x 889 2x 679) x21 AAO Pad / Pit liner $ 5,000.00 Herculite DNOW Welding labor $ 3,896.00 4 days x 974 AAO Water Well, Tank, and Pumps $ 5,600.00 24 x 150, 2 days x 1000 M -W, Rain 4 rent Camp $ 36,750.00 0 x 175 per person 21 days, not verifiei Hilcorp Health, Safety and Environmental Safety and Compliance $ 21,105.00 1005 days x 21 AAO Waste Management Refuse Disposal $ 1,000.00 month rental and disposal Triangle recycling Septic Disposal $ 10,000.00 2 porta potties and disposal Isaacs Honey wagon Materials and Supplies Fuel $ 12,000.00 4000 gallons x $3 Doyle's Drilling Fluids $ 4,000.00 2 pallets Bentonite chips AK Mineral supply EXHIBIT 1 (NORDAQ) Pane 1 of 2 NordAq Energy Tiger Eye #1 Plug and Abandon Slickline / Eline $ 42,941.00 7 runs, + 4 days crew standby x 1650, 7 days equipment standby 350, 3 days operating x 3040 Pollard Downhole Tools Plugs $ 2,400.00 3 CIBP's Pollard Perfs $ 3,750.00 3 x 1250 Pollard Cementing Services - P&A Dump bail $ 3,750.00 5 x 750 Pollard P&A $ 152,166.54 4 plugs Halliburton Subtotal: $ 625,364 Management fee $ 41,238.75 Cost +10% AAO TOTAL: $ 666,602 EXHIBIT 1 (NORDAQ) Paae 2 of 2 STATE OF ALASKA ALASKA OIL AND GAS CONSERVATION COMMISSION ASSIGNMENT OF CERTIFICATE(S) OF DEPOSIT AND JAN 2 CONFIRMATION AND AGREEMENT OF ISSUING BANK On _ _2�5, 201 1 , ocAav_ En _, _ (Principal) Igor) q350 N1,11&I An,Aorw A k rl 4 Sd 7 _ .--- (Address) executed the following certificate(s) of deposit (Certificate(s)): `:;If"P,'t�, ¢0 1. q Q 6963y tt in the amount of $__200, - Ow 2. in the amount of $ to secure, in accordance with 20 AAC 25.025, any default that may occur under State of Alaska, Alaska Oil and Gas Conservation Commission (AOGCC) Personal Bond No. 46361634 Bond). WHEREAS, under 20 AAC 25.025, an operator submitting a personal bond on Form 10- 402B, must provide security, issued in the sole favor of the AOGCC, by a bank authorized to do business in the State of Alaska guaranteeing the operator's perfomnance; NOW THEREFORE, to meet the requirements of 20 AAC 25.025, under this Assignment of Certificate(s) of Deposit and Confirmation and Agreement of Issuing Bank (Assignment), A. the Principal/Obligor agrees to the following: 1. it assigns its rights to the Certificate(s) to the AOGCC; 2. the State of Alaska, by and through its duly authorized agents, is irrevocably constituted and appointed as its Attorney -in -Fact to do all things necessary to effectuate the purposes of this Assigrunent; and this Assignment shall remain in full force and effect until released in writing by the AOGCC in accordance with 20 AAC 25.025(c). B. The Issuing Bank confirms and agrees to the following: it is a bank authorized to do business in the State of Alaska; AOGCC — ASSIGNMENT OF CD(s) / CONTFIRMATION/AGREEMENT (4/2009) Page 1 of 5 EXHIBIT 2A (NORDAQ) Paae 1 of 6 2. it is federally insured or a Federal Reserve Bank branch.- it ranch; it has changed its records to show that, subject to its compliance with all applicable State of Alaska and federal laws, only the AOGCC may collect the principal amount(s) of the Certificate(s); 4. it has placed a hard hold or freeze on the Certificate(s) in accordance with this Assignment; 5. it shall, within 3 business days after the Certificate(s) are issued, deliver the original Certificate(s)—or, if it does not issue original Certificate(s), other account documents, such as receipts, adequately showing that the Certificate(s) were issued—to the AOGCC (which shall hold them until this Assignment is released in writing by the AOGCC); 6. the Certificate(s) comply with the following requirements: (a) the principal of the Certificate(s) is/are in the sole favor and for the exclusive use of the AOGCC—i.e., the Certificate(s) will be held by the Issuing Band in trust for the AOGCC; (b) the Certificate(s) is/are assigned to the AOGCC in writing and upon the books of the Issuing Bank to secure any default, as determined by the AOGCC in its sole discretion, that may occur under the Bond, which accompanies the Certificate(s); (c) subject to the Issuing Bank's compliance with all applicable State of Alaska and federal laws, the AOGCC alone, in its sole discretion, shall authorize the release, in any form, to any party of any or all of the principal amount(s) of the Certificate(s); (d) the Certificate(s) is/are, at any time prior to maturity, redeemable, and the principal amount(&) of the Certificate(s) is/are payable, in whole or in part at the AOGCC's sole discretion, to the AOGCC immediately upon the AOGCC's written demand; (e) the Certificate(s) is/are in such amount(s) that liquidation prior to maturity wilt result in the full amount of the Bond, or the Certificate(s) is/are issued with the provision that all costs of liquidation (including, for example, penalties for early redemption) will be paid out of the interest earned of the Principal/Obligor, not out of principal amount(s) of the Certificate(s); (t) the Certificate(s) is/are federally insured; (g) the Certificate(s) automatically renew; AOGCC -- ASSIGNMENT OF CD(s) / CONFIRMATION/AGREEMENT (4/2009) Page 2 of 5 EXHIBIT 2A (NORDAQ) Paae 2 of 6 (h) the Certificate(s) Ware subject to no expiration date that would restrict the right of the AOGCC to collect the principal amount of the Certificate(s) at any time of default; and (i) the Certificate(s) is/are not, and will not be, subject to any rights of set-off or liens of the Issuing Bank; and 7. the State of Alaska, by and through its duly authorized agents, is irrevocably constituted and appointed as its Attorney -in -Fact to do all things necessary to effectuate the purposes of this Assignment; 8_ this Assignment shall remain in full force and effect until released in writing, by the AOGCC in accordance with 20 AAC 25.025(c); and 9, it shall urimediately notify the AOGCC and Principal!Obligor if it becomes unable, for any reason, to fulfill its obligations under the Certificate(s) or it it teams, or reasonably should have learned, that any confirmation or agreement above is or becomes inaccurate. IN WITNESS WHEREOF, the Principal/Obligor has set its signature and seal (if it has one) this day of 726//. (Signature of Principal/Obligor)+ Title: IN WITNESS WHEREOF, the Issuing Bank has set its signature and seal (if it has one) this -7 day of (Signa of Iss Bank) By:M" 0 r S. Title: &5 noas &V�—, AOGCC — ASSIGNMENT OF CD(s) / CONFIRMATION/AGREEMENT (4/2009) Page 3 of 5 EXHIBIT 2A (NORDAQ) Paae 3 of 6 STATE OF ALASKA ) )ss. 3 Y JUDICIAL DISTRICT ) ACKNOWLEDGENFENT OF PRINCIPAL/OBLIGOR On this,2-1 ay ofjC411A� , 2Cti 1 , before me, a notary public in acid for the State of Alaska, duly commissioned and sworn, appeared to me personally known, who, being by me duly sworn, said the following: (1) ke/she is 4 a"� tr�o-V7 of -D�—k 0 Y _ C , the Principal/Obligor that executed the attached Assignment of Certificate(s) of Deposit and Confirmation and Agreement of Issuing Bank (Assignment); (2) the seal (if applicable) affixed to the Assignment is the Principal/Obligor's corporation seal; (3) the Assignment was signed and sealed (if applicable) on behalf of the Principab'Obligor by the authority of its Board of Directors; and (4) executing the Assignment is the free act and deed of the Principal/Obligor for the uses and purposes set forth in it. IN WITNESS WHEREOF, I have hereunto set my hand and official seal on the day, month, and year aforesaid. a (r(NOTARY Notary Public in and for the State of Alaska PUBLIC ,k My Commission Expires: 2-0 1 Z AOGCC — ASSIGNMENT OF CD(s) / CONFIRMATION/AGREEMENT (4/2009) Page 4 of 5 EXHIBIT 2A (NORDAQ) Pace 4 of 6 STATE OF ALASKA ) )5S. �— 3UDICIAL DISTRICT ) ACKNOWLEDGEMENT OF ISSUING BANK On this,�l�day of ]�u+'t 20 1! , before nie, a notary Public i' and for the State of Alaska, duly commissioned and sworn, appeared JC Cto me personally known, who, being by me duly sworn, ,said the following: (i) he/she is V�At y�lt/1S__ OfiL- of rM' the Issuing Bank that executed the attached Assignment of Certificate(s) of Deposit and Confirmation and Agreement of Issuing Bank (Assignment); (2) the seal (if applicable) affixed to the Assignment is the Issuing Bank's corporation seal; (3) the Assignment was signed and sealed (if applicable) on behalf of the Issuing Bank by the authority of its Board of Directors; and (4) executing the Assignment is the free act and deed of the Issuing Bank for the uses and purposes set forth in it. IN WITNESS WHEREOF,1 have hereunto set my hand and official seal on the day, month, and year aforesaid. -A�6- 1,1C Notary Public in and for the State of Alaska POU13 My Commission Expires_ ©, -2-" - 2^ ?� 12- AOGCC - ASSIGNMENT OF CD(s) I CONFIRMATION/AGREEMENT (4/2009) Page 5 of 5 EXHIBIT 2A (NORDAQ) Paae 5 of 6 WF:L.LS FARGO _I Time Account Receipt/Disclosure Banker Name: Officer/Prrrtfolio Number: Date: (CHRISTIAN COSTELLO IF0605 01/2.5/2011 _ Banker Phone. y Store Number. Banker ALI: Banker MAC: 1907/267-5565 103402 10001061 IK3207-011 Customer/Account Information Primary Customer Name: Customer Number (ECN): NORDAQ ENERGY INC. _ 1428506192336116 COID: Product: Account Number. Open Date: Term: Maturity Date: 100569 (CDA j9636963911 101/25/2011 16 months 107/25/2011_ Time Account Opening Deposit: Interest Rate: Annual Percentage Yield: Fixed Rate: Variable Rate: Renewal Term: 1$200,000.00 1 0.20% 1 0.20% (Yes jNo 16 months Interest will be paid: The method or payment wilt be: (EVERY OI MONTHS AND AT WITHDRAWAL jBY ADDING TO PRINCIPAL Renewability. IYOU WILL AUTOMATICALLY RENEW MY TIME ACCOUNT AT MATURITY UNLESS I NOTIFY YCU OTHERWISE Acenunt Title and Mailina Information Customers) Listed on Account Mailing Address: NORDAQ ENERGY INC. 9350 NORDIC ST Address line 2: ITF: ALASKA OIL AND 'SAS City. State: (CONSERVATION COMMISSION ANCHORAGE JAK ZIP/Postal Cork: Country: I 99507-6035 Jos This is a receipt. It need not be presented at the time you obtain payment from the Bank, W60168 1111-10 SVP) Page 1 or 1 EXHIBIT 2A (NORDAQ) Paae 6 of 6 November 6, 2012 THEJ�STNIT K--A— Deparlinent o Natural Resoitrce.solALAS DI`vlCi ri ofGilo G4 -,n l"I C 1, 41 a t P, f.) i^'.'U;' Nordaq Energy Inc. Attn: Robert Warthen 3000 A street, Suite 410 Anchorage, AK 99503. RE: Nordaq Energy Inc. Statewide Oil and Gas Lease Bond Dear Mr. Warthen: The Statewide Oil and Gas Bond submitted by Nordaq Energy, Inc. in the form of a Certificate of Deposit with Wells Fargo Bank (Account # 9422389560) in the amount of $500,000 under the control of the State of Alaska is hereby accepted 09/17/2012 under 11 AAC 83.160. The Bank has agreed to not alter or cancel the Certificate of Deposit without the State's concurrence and the Certificate of Deposit is subject to the following conditions: 1. The State of Alaska may require additional financial security as necessary. 2. Nordaq Energy Inc. Does hereby irrevocably constitute and appoint the State of Alaska, Department of Natural Resources, Division of Oil and Gas by and through its authorized agents and Attorney -in Fact as Beneficiary of the Certificate of Deposit. 3. Nordaq Energy Inc. agrees that only the State of Alaska, Department of Natural Resources, division of Oil and Gas, upon written notice shall cause the transfer of any and all funds in the Certificate of Deposit referenced above. The statewide bond satisfies all the bond requirements to which an oil and gas lease is subject under the Department of Natural Resources. All oil and gas bonds must comply with 11 AAC 82.600. Thank you for providing the Certificate of Deposit to satisfy the Statewide Oil and Gas bond requirements. If you have any questions, contact David Edmunds at 907-269-8769 or email him at david-edmunds@alaska.gov. Sincerely, 1//)-Z�e)v-t-� Kim Kruse Petroleum Land Manager EXHIBIT 2B (NORDAQ) Paue 1 of 6 cc. Rachelle Burnett Business Relationship Manager 1351 E. Huffman Road Suite 201 Anchorage, Alaska Jeremy Vance Wells Fargo Bank 301 W. Northern Lights Blvd., Suite 100 Anchorage, Alaska 99503 EXHIBIT 26 (NORDAQ) Paae 2 of 6 Form DOGiPCU-01 October 2011 Fite No. STATE OF ALASKA DEPARTMENT OF NATURAL RESOURCESD 7!7 DIVISION OF OIL AND GAS `� AUG 2 �I STATEWIDE OIL AND GAS BOND DIVISION OF ALL MEN BY THESE PRESENTS that we, OIL AND GAS as principal, whose address is as surety, are held and firmly bound unto the State of Alaska in the sum of FIVE HUNDRED THOUSAND DOLLARS ($500,000.00), lawful money of the United States for the use and benefit of (1) the State of Alaska, (2) any owner of a portion of the land subject to the coverage of this bond who has a statutory right to compensation in connection with a reservation of the oil and gas deposits to the State of Alaska, and (3) any lessee or permittee under a lease or permit issued by the State of Alaska prior to the issuance of an oil or gas lease for same land subject to this bond, covering the use of the surface or the prospecting for or development of other mineral deposits in any portion of such land, to be paid to the State of Alaska. For such payment, well and truly to be made, we bind ourselves and each of us and each of our heirs, executors, administrators, successors and assigns, jointly and severally by these presents. THE CONDITIONS of the foregoing obligations are such that, WHEREAS: A. The principal in one or more of the following ways has an interest in oil and gas leases on lands of the State of Alaska under the jurisdiction of the Department of Natural Resources: (1) as the lessee of such leases, (2) as the approved holder of operating rights in all or part of the lands covered by such leases under operating agreements with the lessee, and (3) as designated operator or agent under such leases pending approval of an assignment or operating agreement; and, B. The principal is authorized to drill for, explore for, develop, produce, process, and market oil and gas deposits in or under the lands covered by such leases and is obligated to comply with certain covenants and agreements set forth in such leases; and, C. The principal and surety agree that the coverage of this bond shall extend to all of the principal's holdings under such leases in the State of Alaska, and without notice to the surety shall also extend to and include: 1. Any such oil and gas lease hereafter issued to or acquired by the principal, the coverage to become effective immediately upon such issuance or upon approval by the State of Alaska of a transfer in favor of the principal; and, EXHIBIT 213 (NORDAQ) Pane 3 of 6 2. Any such operating agreement hereafter entered into or acquired by the principal, the coverage to become effective immediately upon approval by the State of Alaska of the agreement or of a transfer of such an agreement to the principal; and, 3. Any designation hereafter or the principal as operator or agent of a lessee under such a lease, the coverage to become effective immediately upon the filing of such a designation with the State of Alaska; and, 4. Any extension of a lease covered by this bond, such coverage to continue without any interruption due to the expiration of the term set forth in the lease; Provided however, that the surety may elect to have additional coverage authorized under this Paragraph C, to become inapplicable as to all interests of the principal acquired more than 30 days after the receipt of written notice of such election by the Division of Oil and Gas; and, D. The surety hereby waives any right to notice of, and agrees that this bond shall remain in full force and effect notwithstanding: I . A transfer or transfers, either in whole or in part, of any or all of the leases or of the operating agreements, and further agrees to remain bound under this bond as to the interests, either in the leases or in the operating agreements or in both, retained by the principal when the approval of the transfer or transfer becomes effective; and, 2. Any modification of a lease or operating agreement or obligations thereunder whether made or effected by commitment of such lease or operating agreement to unit, cooperative, communitization, or storage agreements, or development contracts, suspensions of operations or production, waivers, suspensions or changes in rental, minimum royalty and royalties, compensatory royalty payments, or otherwise; and, E. The principal and surety agree that notwithstanding the termination of any lease or leases, operating agreements, or designations as operator or agent covered by this bond, whether the termination, in part or wholly is by operation of law or otherwise, the bond shall remain in full force and effect as to all remaining leases, operating agreements, or designations covered by this bond; and, The principal, as to any lease or part of a lease for lands as to which he has been designated as operator or agent or approved as operator in consideration of being permitted to furnish this bond in lieu of the lessees, agrees and by these presents does hereby bind himself to fulfill on behalf of each lessee all the obligations of each such lease for the entire leasehold in the same manner and to the same extent as though he were the lessee; and, G. The principal and surety agree that the neglect or forbearance of the lessor, in enforcing against the lessees of such lessor the payment of rentals or royalties or the performance of any other covenant, conditions, or agreement of the leases, shall not in any way release the principal and surety, or either of them, from any liability under this bond; and, EXHIBIT 2B (NORDAQ) Paae 4 of 6 H. The principal and surety agree that; in the event of any default under the leases, the lessor may commence and prosecute any claim, suit, action, or other proceeding against the principal and surety or either of them without the necessity of joining the lessees. NOW THEREFORE, if said principal shall in all respects faithfully comply with all of the provisions of the leases referred to hereinabove, then the above obligations are to be void; OTHERWISE, to remain in full force and effect. APPROVAL AND ACCEPTANCE BY THE STATE OF ALASKA By: Dated: Department of Natural Resources, Division of Oil and Gas INSTRUCTIONS: I. The surety on the bond may be any corporation qualified to issue performance and reclamation bonds in the State of Alaska. 2. If the principals are partners, their individual names shall appear in the spaces provided, with recital that they are partners comprising a firm, naming it, and all members of the partnership shall execute the bond as individuals. 3. Where this bond is executed by a corporation, either as surety or as principal, the bond must be executed by a duly authorized officer, and the individual signing must submit evidence of their authority to act for the corporation. 4. When any party executes this bond through an agent, a power of attorney or other evidence of authority must accompany this bond. EXHIBIT 2B (NORDAQ) Paae 5 of 6 South AnciorageBusiness Banking MAC K3211-020 1351 E. Huffman Road Suite 201 Anchoraae, AK 99515 September 17, 2012 State of Alaska RE: Certificate of Deposit To Whom It May Concern: This letter is to inform you that Nordaq Energy, Inc. has one (1) Certificates of Deposit (CD) with Wells Fargo Bank, N.A. The CD listed below are located at branch 6759 (13 51 E Huffman Ste 202 Anchorage, AK 99515). Account Amount Maturity Date 9422389560 $500,000 01/31/2013 The above Iisted certificate of deposit is under the control of The State of Alaska. The Bank will not alter or cancel the certificate of deposit without the State's concurrence. Release of funds to the beneficiary, Nordaq Energy, Inc., is dependent upon the State's written instruction. The certificate of deposit is set to renew automatically. Please feel free to contact me at 907-348-5367 with any questions or concerns. Sincerely, CI Rachelle Burnett Business Relationship Manager Together we'll go far EXHIBIT 2B (NORDAQ) Paae 6 of 6 ALASKA COIL AND GAS CONSERVATION COMMISSION DOCKET NUMBERS CATH -16-031 AND CATH I6-032 AFF1_DA IT OI{` PETER lie DICKINSON ISL STATUS OF WORK TO PLUG AND ABANDON TIGER EYE CENTRAL -1 AND SHADURA-I WELLS STATE OF TEXASCOUNTY OF ) ) ss. PETER M. DICKINSON, being first duly sworn -upon his oath, deposes and states: 1. 1 am the President of All American Oilfield, LLC ("All American"), a limited liability company based in Kenai, Alaska, 2. 1 have been involved in work for NordAq Energy, Inc. ("NordAq") on the Tiger Eye Central -1 well ("Tiger Eye") and the Shadura-1 well ("Shadura") since their inception, and All American drilled both of the wells. 3. All American is the general contractor for NordAq for the work to plug anal abandon Tiger Eye and Shadura. 4. All American has contracts or agreements with all of the vendors listed on the NordAq authorization forexpenditure to plug and abandon Tiger Eye, which is in a total amount of $666,602. [Exhibit I to NordAq's First Supplemental Response to Revised Notice of Proposed Enforcement Action re Tiger Eye] 5. All American cannot begin work to plug and abandon Tiger Eye before August 1, 2017, because the necessary camp on the West side of Cook Inlet is currently in use and will riot be available prior to that time. EXHIBIT 3 (NORDAQ) Paae 1 of 2 6. NordAq is also waiting for a few Mate permits before it can begin the work to plug and abandon Tiger Eye, 7. All American currently plans to begin the work to plug and abandon Tiger Eye after the necessary camp becomes available and after the remaining permits are obtained. The -work is expected to last approximately 71 days. 8. All American has contracts or agreements with all of the vendors listed on the NordA.q aull-ior.•ization for expenditure to plug and abandon Shadura, which is in a total amount of $483,826. [Exhibit 1 to NordA q s First Supplemental Response to Devised. Notice of Proposed Enforcement Action re Shadura] 9. All American cannot begin the work to plug and abandon Shadura until there is approximately one foot of frost and one foot of snow in the area, because it is necessary to build a snow trail to the well in theabsence of any existing roads. 10. With the approval. of .A0GCC, N'ordAq may try to plug and abandon Tiger Eye and Shadura consecutively in an effort to decrease costs and increase efficiency, DATED this I_ day of June, 2017. �.w -----------.................. PETE1. ASI. DICKINSON' SUBSCRIBED ANDSWORN TO before me this"2 is day of June, 2017. NOEMII GO�EZ NOtBf y Public, SWO ()f T"04 �. " Comm. wires Af-�9=2rrlif A.' Nptafy ID 129999091 C)�q_o'ta2ryPLuLblic in Cantorexas My Commission Expires: 6 �D 2-c/ 2 EXHIBIT 3 (NORDAQ) Paae 2 of 2 ALASKA OIL AND GAS CONSERVATION COMMISSION DOCKET NUMBERS OTH-16-031 AND OTH 16-032 AFFIDAVIT OF STEPHEN F. HENNIGAN RE NORDAQ'S EFFORTS TO PLUG AND ABANDON TIGER EYE CENTRAL -1 AND SHADURA-1 WELLS STATE OF ALASKA ) ) ss. THIRD JUDICIAL DISTRICT ) states: STEPHEN F. HENNIGAN, being first duly sworn upon his oath, deposes and 1. I am a project engineer and I work through and for Sierra Hamilton, LLC, of which my former company, Petroleum Engineers, Inc., has become a part. 2. I was contracted by NordAq to prepare and submit drilling permits, weekly and final reports, sundries, etc., to State agencies, primarily AOGCC, in the drilling of NordAq-operated Shadura-1 (PTD No. 211-014 ) ("Shadura") and Tiger Eye Central -1 (PTD No. 212-102) ("Tiger Eye"). 3. I was integrally involved with the preparation and submittal of the end -of - well sundries for the above wells—for Shadura Sundry 312-001, for Tiger Eye Sundry 313-239. 4. I have met with and had numerous telephone and email discussions with the AOGCC staff on behalf of NordAq in discussing Sundry data. 5. I have been integrally involved in submitting final data to the AOGCC via the required 10-407 forms and format on both wells. EXHIBIT 4 (NORDAQ) Paae 1 of 2 1 6. Shadura-1 was suspended rather than plugged and abandoned at that time, as it was intended that NordAq would drill a second Shadura well and use Shadura-1 as a sidetrack candidate or for other utility purposes. 7. Tiger Eye was secured rather than plugged and abandoned at that time because, in my understanding, NordAq had an understanding with Cook Inlet Energy to take over the well for utility purposes. 8. I have prepared and submitted to the AOGCC sundries for plugging and abandonment of both wells, which have been approved: a. Shadura - 317-027 b. Tiger Eye - 317-083 9. I have been contracted by NordAq to provide engineering services and interaction efforts in the abandonment of Shadura and Tiger Eye. In addition, I am to supply daily, weekly, and final reports, as required by the AOGCC, to them. DATED this :�/ day of June, 2017. TEPHEN F. HENNIGAN SUBSCRIBED AND SWORN TO before me this �� ay of June, 2017. otary Public in and for AIaska My Commission Expires: 2 EXHIBIT 4 (NORDAQ) Paae 2 of 2 NORDAQ ENERGY, INC. June 22, 2017 HAND DELIVERED Ms. Cathy P. Foerster, Chair Alaska Oil and Gas Conversation Commission 333 West Seventh Avenue Anchorage, Alaska 99501-3572 Re: Docket Number: OTH-16-032 RECEIVED JUN 27 2017 Revised Notice of Proposed Enforcement Action Failure to Plug and Abandon Tiger Eye Central -1 (PTD 212-102) Before Expiration of Owner's Rights in Oil and Gas Leases ADL 391104 and C-061677 Dear Ms. Foerster: In accordance with your letter dated June 12, 2017, NordAq submits this summary of its position in this matter and all accompanying documentary material. With respect to the requirement for a surety bond, NordAq assumes the requirement is not in effect because it is part of the proposed enforcement action to which NordAq timely responded. NordAq respectfully requests that AOGCC reconsider the bonding requirement, and submits the following facts and attached documentary material to support these facts. The amount of the bond significantly exceeds the estimated cost to plug and abandon the Tiger Eye Central -1 well ("Tiger Eye"). Attached as Exhibit 1 is NordAq's authorization for expenditure to plug and abandon the well, which is in a total amount of $666,602. This is slightly over half the proposed amount of the surety bond. 560 E. 34th Avenue, Anchorage, AK Fax: Suite 200 99503 Main: 907.646.9315 807.646.9317 WWW'nordagenergy.com NORDAQ ENERGY, INC Ms. Cathy P. Foerster June 22, 2017 Page 2 2. NordAq currently has a Personal Bond in the amount $200,000 on file with AOGCC, and a Statewide Oil and Gas Bond in the amount of $500,000 on file with the Department of Natural Resources ("DNR"). Attached as Exhibit 2 are documents to demonstrate the existence and extent of these bonds. NordAq believes these bonds are applicable to the plugging and abandonment work that remains to be done. 3. NordAq is currently working with a general contractor and subcontractors to do the work necessary to plug and abandon the well. The work will begin after August 1, 2017, and will take approximately twenty-one days to complete. Attached as Exhibit 3 is an affidavit from the general contractor, Peter M. Dickinson of All American Oilfield, LLC, to attest to these facts. NordAq would appreciate your consideration of these facts with respect to its request for AOGCC to reconsider the bonding requirement. To the extent the State wants a surety bond to protect against the risk of NordAq failing to plug and abandon Tiger Eye, NordAq is actively moving forward to plug and abandon the well as quickly as possible (see Affidavit of Stephen F. Hennigan referenced below). In addition, NordAq currently has significant bonds on file with the State of Alaska that are designed to protect the State in the unlikely event of NordAq's failure to perform its obligations with respect to the well. NordAq is concerned that AOGCC's proposed level of bonding will divert valuable company resources such that it will detract from the goal to plug and abandon the well as quickly as possible. NordAq believes the foregoing facts are sufficient to justify no additional bonding. With respect to the proposed civil penalty, NordAq maintains that it should not be subject to the penalty under the facts of this case. Tiger Eye was secured rather than plugged and abandoned earlier because NordAq had an understanding with Cook Inlet Energy to take over the well for utility purposes. Attached as Exhibit 4 is an affidavit from of Stephen F. Hennigan, who was involved with the preparation and submittal of the end -of -well sundry for Tiger Eye, to attest to this. NordAq was discussing alternative uses of the well with Cook Inlet Energy until late 2016. Cook Inlet Energy, however, did not take over the well. 3000 A Street, Suite Anchorage, AK Main: Fax: www.nordagenergy.com 410 99503 907.646.9315, 907.646.9317 NORDAQ ENERGY, INC.. Ms. Cathy P. Foerster June 22, 2017 Page 3 In addition, NordAq has cooperated with AOGCC in this matter by timely submitting a Sundry Application to permanently plug and abandon Tiger Eye as required by the original Notice of Proposed Enforcement Action dated December 2, 2016. As noted in the Revised Notice of Proposed Enforcement Action dated May 24, 2017, AOGCC approved that application. NordAq would appreciate your consideration of these facts with respect to the proposed civil penalty. NordAq reasonably believed that Cook Inlet Energy would take over Tiger Eye for utility purposes, and NordAq has made a good -faith effort to cooperate with AOGCC. NordAq is again concerned that AOGCC's proposed penalty will divert valuable company resources such that it will detract from the goal to plug and abandon the well as quickly as possible. NordAq believes the foregoing facts are sufficient to justify no civil penalty. In the alternative, NordAq requests that AOGCC stay the bonding requirement and proposed civil penalty until September 30, 2017, at which time NordAq anticipates that the work on Tiger Eye will be complete. If the work is complete at that time, NordAq requests that the Commission waive the bonding requirement and proposed civil penalty. NORDAQ ENERGY, IW. B Y A -111r David Pfeiffer Chief Financial Officer Enclosures 3000 A Street, Suite Anchorage, AK Main: Fax: www.nordagenergy.com 410 99503 907.646.9315 907.646.9317 NORDAQ ENERGY, INC. Cathy P Foerster Alaska Oil & Gas Conversation Commission 333 West Seventh Avenue Anchorage, AK 99501 Dear Ms. Foerster– 'ID JUN 27 2017 June23rd, 2017 Please find enclosed the original response letters pertaining to the Revised Notice of Proposed Enforcement Action for the Plug & Abandonment for Tiger Eye & Shadura. Copies of these letters were hand delivered by Robert Warthen to your office earlier this week. Please do not hesitate to contact me at dpfeiffer@nordagenergy.com or 630-699-2175 with any questions. Sincerely, 0 q/ — David Pfeiffer Chief Financial Officer 560 East 341h Avenue, j I Suite 200 1 Anchorage, AK 99503 Main: 907.646.9315 Ears: 907.646.9317 www.nordagenergy.com 10 TIDE STATE 01ALASKA GOVERNOR BILL WALKER June 12, 2017 CERTIFIED MAIL — RETURN RECEIPT REQUESTED 7015 0640 0003 5185 6014 David Pfeiffer Chief Financial Officer Nordaq Energy, Inc. 560 East 34th Avenue, Suite 200 Anchorage, Alaska 99503 Alaska Oil and Cas Conservation Commission 333 West Seventh Avenue Anchorage, Alaska 99501-3572 Main: 907.279.1433 Fax: 907.276.7542 www.aogcc.alaska.gov Re: Docket Number: OTH 16-031 Failure to Plug and Abandon Shadura-1 (PTD 211-014) Before Expiration of Owner's Rights in CIRI Lease C-061648 Failure to Respond to Notice of Proposed Enforcement Action Docket Number: OTH 16-032 Failure to Plug and Abandon Tiger Eye Central -1 (PTD 212-102) Before Expiration of Owner's Rights in Oil and Gas Leases ADL 391104 and C-061677 Failure to Respond to Notice of Proposed Enforcement Action Informal Reviews Dear Mr. Pfeiffer: As part of the informal review process, the Alaska Oil and Gas Conservation Commission (AOGCC) is providing Nordaq Energy, Inc. (Nordaq) an opportunity to submit documentary material and make written and oral statements regarding the above -referenced Notices of Proposed Enforcement Action. There will be no formal record kept of the review and the review will not involve the presence of counsel, either for the Alaska Oil and Gas Conservation Commission (AOGCC) or the operator. The informal review meeting is scheduled for June 27, 2017 at 10:00am in the AOGCC's Anchorage office at 333 West 7th Avenue. Mr. David Pfeiffer June 12, 2017 Page 2 of 2 Copies of all written submissions and a summary of any oral statements planned by Nordaq should be provided to the AOGCC no later than 12:OOpm June 22, 2017 so we can make best use of the informal review. Sincerely, P46$-� Cathy f Foerster Chair, Commissioner a Domestic X(� r 0 For delivery information, visit our website at WWVV.Usps.con? USLn co Certified Mail Fee r-1 $ V") Extra Services & Fees (check box, add fee as appropriate) El (hardcopy) $ MC] C]Return Receipt (electronic) $ Postmark O C3 ❑Certified Mall Restricted Delivery $ Here C:l ❑ Adult Signature Required $ ❑ Adult Signature Restricted Delivery $ C3 Postage $ --- -- 0 Total Postage and Fees David Pfeiffer Ln sent To Chief Financial Officer ------- NordAq Energy, Inc. E3Stla38t and Apt. IJo., or PO Box N o. r` 560 E. 34th Ave., Ste. 200 City, $tale, ZlP+4® Anchorage, AK 99503 ■ Complete items 1, 2, and 3. ■ Print your name and address on the reverse so that we can return the card to you. ■ Attach this card to the back of the mailpiece, or on the front if space permits. David Pfeiffer Chief Financial Officer NordAq Energy, Inc. 560 E. 34th Ave., Ste. 200 Anchorage, AK 99503 A. Signature X(� r ❑ Agent ❑ Addressee B. Received by (Pinter Name) C. Qate pf Delivery D. Is delivery address different from item 1? LJ Yes If YES, enter delivery address below: ❑ No ECEIVE[ JUN 16 2017 II �I�I�I �'II I'I II'I I �'I I I'I II I II I� I III �II �II 0 dull Signature ❑ Priority Mail Expresso ❑ Adult Signature ❑Registered MaiIT"' ❑ Adult Signature Restricted Delivery ❑ Registered Mail Restricted 0 Certified Mail® Delivery 9590 9401 0057 5071 01136 66 ❑ Certified Mail Restricted Delivery 0 Return Receipt for ❑ Collect on Delivery Merchandise 2-Article_NuM er (transfer f 2m SeNI(ZE-label 0 Collect on Delivery Restricted Delivery ❑ Signature Confirmation- --cured Mail ❑ Signature Confirmation 7 015 0640 0003 5185 6 014 cured Mail Restricted Delivery Restricted Delivery _ ter $500) PS Form 3811, April 2015 PSN 7530-02-000-9053 Domestic Return Receipt NOKDAQ ENERGY, INC. June 8th, 2017 Cathy P. Foerster, Chair Alaska Oil and Gas Conversation Commission 333 West Seventh Avenue Anchorage, Alaska 99501-3572 Re: Docket Number: OTH-16-032 Revised Notice of Proposed Enforcement Action Failure to Plug and Abandon Tiger Eye Central -1 (PTD 212-102) Before Expiration of Owner's Rights in Oil and Gas Leases ADL 391104 and C-061677 Dear Ms. Foerster: This letter is NordAq's timely written response to the letter in this matter from the Alaska Oil and Gas Conversation Commission ("AOGCC") dated May 24, 2017. NordAq does not concur with the proposed action described in that letter and requests informal review. Consistent with that letter, NordAq will avail itself of the opportunity to submit documentary material and make a written or oral statement during that review. If NordAq disagrees with the AOGCC's proposed decision or order after that review, then NordAq intends to file a written request for a hearing within ten days after the proposed decision or order is issued. In the interim, NordAq respectfully requests a stay of the bonding requirement set forth in the letter referenced above. NordAq will submit evidence that the bonding requirement significantly exceeds the estimated cost to plug and abandon the Tiger Eye Central -1 well. In addition, as noted in the letter, NordAq already has a $500,000 bond on file with DNR. Sincerely, NORDAQ ENERGY,4NC. David,"fe+fffer Chief Financial Officer 560 East 341h Avenue, Suite 200 Anchorage, AK 99503 Main: 907.646.9315 Fax: 907.646.9317 1 www.nordagenergy.com Cath% 1. I-tcrster. Chair 1la,ka Uit anis Ciao ('trn%cr>ation Cowfnis,ittll `.� We,,( '�'CkCliff) AkCline \nchoriwc. Alaska RECEIVED JUN 0 S 2017 AOGCC loot° 91h, ?t)1 Inc l)+tckct Ntunts r; i)411-di,-f!i' lir%iwcrl Notice or Proposed Fsiforcenient Action Iailtire to Phar; and Ahandon I ; cr l--ke Ccntral-I t II 11) '12- Io1 i licIoIc I xpiratitna of >cyncr', Rights in ()iI .u.d (i;ati I casc, .A1')1 >cal Ita.1 anti C-))616 . I har %k Voev tcr- I tit, loter 1, Nord:,Ntl , ))inch Nrltwn respttn,c to (hC letter an this matter trona the,. �AJ&Nka C)il and Cia.? C'onker,.afitat C onli "slctrs t", C)CiCC') (Coed Miry 14. ?at 1 ". Ncud.Aq doe, "tit Cetncur kkith the Ikrolioscd action dc,crihcd in that letter and reipic tl trilo-1nral rektckc. C unsistcnt kk ith tla:tt letter, NordAq %k ill ak aii iteclf of the t�ppotlunitk tet ,nhntit dok:nnwm1ary material .and make a kkrittcn ctr ural ,tatcaraent da.arinv that l,ckicuk 11* NatrdAq di ;tgucs kk atlt the At Hit °(' proposed decision or +trdcr atter thm rct ic%% then NckrdALl intends to file al kdritterl rcque.t tier a hearan) %%nhin ten d:ak, atter tlrc pruparscd ;lccision or order is t;,ued In the interim. Nord/'lc( ruspcctt'ttllk request, a :taav of the bonding rcquircnlcltt set forth in the. letter retercnced aboke. NordAq gill �,sjhnlii ck idcfarc that the Iktendine rcytnrcntertt ,i'niticantik ;: ycccch tile cstimabandon Lost to phaw� and b ntdon the I igcr 1.\c Cennrai-1 k%C111 lar addition, av' meted In ttac letter. NordAq aircaadk h.a, a Y'+tH)_000 hood on tale vkith I)NI? Smccrclk . N( )RI )AQ I NI'IiCil' I )a\ idr�i Ice Chicl Financial ( )l'licer S60 fast 34' A nuc. Swete 200 Anchorage. AK 9950.► Maim. 907.1-16.9115 6aju 907 646.5311 WvYw nocdact"e^rgy cc)", THE STATE P I a A F401111 W4415 GOVERNOR BILL WALKER May 24, 2017 CERTIFIED MAIL RETURN RECEIPT REQUESTED 7015 0640 0003 5185 5963 Robert Warthen, Senior Advisor NordAq Energy, Inc. 560 East 34th Avenue, Suite 200 Anchorage, AK 99503 Re: Docket Number: OTH-16-032 Alaska Oil and Gas Conservation Commission 333 West Seventh Avenue Anchorage, Alaska 99501-3572 Main: 907.279.1433 Fax: 907.276.7542 www.aogcc.alaska.gov Revised Notice of Proposed Enforcement Action Failure to Plug and Abandon Tiger Eye Central -1 (PTD 212-102) Before Expiration of Owner's Rights in Oil and Gas Leases ADL 391104 and C-061677 Failure to Respond to Notice of Proposed Enforcement Action Dear Mr. Warthen: The Alaska Oil and Gas Conservation Commission (AOGCC) hereby notifies NordAq Energy Inc. (NordAq) of a revised proposed enforcement action. Nature of the Violation or Noncompliance (20 AAC 25.535(b)(1)). NordAq violated 20 AAC 25.105(a) by its failure to permanently abandon the Tiger Eye Central - 1 exploratory well (Tiger Eye -1) before expiration of NordAq's rights in oil and gas leases ADL 391104 and C-061677. Basis for Finding the Violation or Noncompliance (20 AAC 25.535(b)(2)) On September 4, 2012, NordAq was issued Permit to Drill No. 212-102 for the Tiger Eye -1 exploratory well. Tiger Eye 1 was drilled in 2012 and subsequently suspended. NordAq was the ownerl of CIRI lease C-061677 and State of Alaska lease ADL 391104. The surface location for Tiger Eye 1 lies on acreage owned by Salamatof Native Association Inc. A portion of the surface hole interval crosses oil and gas lease C-061677, and the bottom -hole location for the well lies within oil and gas lease ADL 391104. Tiger Eye -1 is located on the west side of Cook Inlet Basin and is only accessible during summer months. 1 "Owner" means the person who has the right to drill into and produce from a pool and to appropriate the oil and gas the person produces from a pool for that person and others. "Person" includes a natural person, corporation, association, partnership, receiver, trustee, executor, administrator, guardian, fiduciary or other representative of any kind, and includes a department, agency or instrumentality of the state or a governmental subdivision of the state. 1 Docket Number: OTH-16-032 May 24, 2017 Page 2 of 4 On October 14, 2016, the Alaska Department of Natural Resources (DNR) advised AOGCC that it had received, on January 27, 2016, NordAq's surrender of two State of Alaska oil and gas leases associated with the Tiger Eye Unit (leases ADL 391104 and ADL 391103). DNR approved the termination of the Tiger Eye Unit effective October 12, 2016. NordAq's rights in the two leases expired that same date. CIRI's lease C-061677 was terminated by CIRI effective July 1, 2015. (However, AOGCC did not learn of the lease termination until after issuance of the December 2, 2016 Notice of Proposed Enforcement Action.) In the event an operator defaults on its regulatory obligations to plug and abandon a well, the AOGCC looks to the landowner to fulfill those obligations. CIRI is the landowner' for lease C- 061677 and the DNR is the landowner of lease ADL 391104. NordAq violated 20 AAC 25.105(a) when it failed to properly plug and abandon Tiger Eye -1 prior to termination of its rights in CIRI lease C-061677 and State lease ADL 391104. On December 2, 2016, the AOGCC sent to NordAq, via certified mail, a Notice of Proposed Enforcement Action that allowed NordAq a period of 90 days to either: • Submit a Sundry Application for the plugging and abandonment of the Tiger Eye -1 and properly plug and abandon Tiger Eye -1; or • Submit a check in the amount of $1,300,000, which AOGCC estimates to be the cost to properly plug and abandon Tiger Eye -1. The Notice of Proposed Enforcement Action proposed two civil penalties for violating 20 AAC 25.105(a) and 20 AAC 25.535(b)(2): $100,000 for the initial violation: failure to permanently abandon Tiger Eye -1 before expiration of owner's rights in State lease ADL 391104; and 2. $50,000 for violating the requirement to plug and abandon and clear the well site to the satisfaction of the AOGCC as per 20 AAC 25.112 and 20 AAC 25.170 (50 days at $1,000 per day). On January 14, 2017, AOGCC noticed a public hearing for April 4, 2017 at 9:00 a.m. concerning NordAq's failure to permanently abandon Tiger Eye -1 and to respond to the Notice of Proposed Enforcement Action. On February 15, 2017, NordAq submitted a Sundry Application to permanently abandon Tiger Eye -1. On March 7, 2017, NordAq's Sundry Application to permanently abandon Tiger Eye -1 Application was approved. At the April 4, 2017 public hearing, Robert Warthen of NordAq and John Easton of the Alaska Department of Natural Resources (DNR) testified. Mr. Warthen testified that: 2 "Landowner" means the owner of the subsurface estate of the tract affected. i Docket Number: OTH-16-032 May 24, 2017 Page 3 of 4 • Cook Inlet Energy, LLC had expressed interest in the Tiger Eye -1 well as a utility well. NordAq was notified in late October or early November 2016 that Cook Inlet Energy Inc. was no longer interested in utilizing the well. • NordAq plans to commence plugging and abandonment operations as early as June 2017. Operations may be delayed, however, if the well site location is within 600 feet of an active bald eagle nest. Under that scenario, operations would be delayed until mid-July 2017. • Plugging and abandonment operations are seasonal, as a barge is needed to move supplies to the remote West Foreland region. • NordAq's failure to respond to the Notice of Proposed Enforcement Action was due to a robbery at NordAq's office. Mr. Easton testified that NordAq has a $500,000 bond on file with DNR. The record closed at the end of the hearing. Proposed Enforcement Action (20 AAC 25.535(b)(3). Within 30 days of receipt of this letter, NordAq shall submit a surety bond for $1,300,000 issued on Form 10-402A in sole favor of the AOGCC by an authorized insurer under AS 21.09 whose certificate of authority is in good standing with the State of Alaska. This bond will be returned to NordAq following permanent abandonment of Tiger Eye -1 and clearance of well location. This bond shall be forfeited to the AOGCC if Tiger Eye -1 is not permanently abandoned and the well location is not cleared within one year of the date of this Enforcement Action. After consideration of the criteria set forth in AS 31.05.150(g), the AOGCC proposes to impose one civil penalty on NordAq for violating 20 AAC 25.105(a) and 20 AAC 25.535(b)(2): $100,000 for the initial violation of failure to properly abandon Tiger Eye 1 before expiration of owner's rights in State of Alaska oil and gas lease ADL 391104 and CIRI oil and gas lease C-061677. The total civil penalty is $100,000. Rights and Liabilities (20 AAC 25.535(b)(4)). Within 15 days after receipt of this notification — unless the AOGCC, in its discretion, grants an extension for good cause shown — NordAq may file with the AOGCC a written response that concurs in whole or in part with the proposed action described herein, requests informal review, or requests a hearing under 20 AAC 25.540. If a timely response is not filed, the proposed action will be deemed accepted by default. If informal review is requested, the AOGCC will provide NordAq an opportunity to submit documentary material and make a written or oral statement. If NordAq disagrees with the AOGCC's proposed decision or order after that review, it may file a written request for a hearing within 10 days after the proposed decision or order is issued. If such a request is not filed within that 10 -day period, the proposed decision or order will become final on the l Ith day after it was issued. If such a request is timely filed, the AOGCC will hold its decision in abeyance and schedule a hearing. If NordAq does not concur in the proposed action described herein, and the AOGCC finds that NordAq has violated a provision of AS 31.05, 20 AAC 25, or an AOGCC order, permit or other approval, then the AOGCC may take any action authorized by the applicable law including Docket Number: OTH-16-032 May 24, 2017 Page 4 of 4 ordering one or more of the following: (i) corrective action or remedial work; (ii) suspension or revocation of a permit or other approval; (iii) payment under the bond required by 20 AAC 25.025; and (iv) imposition of penalties under AS 31.05.150. In taking action after an informal review or hearing, the AOGCC is not limited to ordering the proposed action described herein, as long as NordAq received reasonable notice and opportunity to be heard with respect to the AOGCC's action. Any action described hereto or taken after an informal review or hearing does not limit the action the AOGCC may take under AS 31.05.160. Sincerely, Cathy . Foerster Chair Commissioner cc: Andrew T. Mack, Commissioner, Department of Natural Resources, (via Certified Mail) Sophie Minich, CIRI President and CEO, Cook Inlet Region, Inc., (via Certified Mail) U.S. Postal Service TM CERTIFIED ❑ Certified Mail Restricted Delivery MAIL° RECEIPT Domestic ❑Adult Signature Restricted Delivery $ Mail Only For delivery information, visit our website at www.usps.com®. ul C0 ri Ln M C3 C3 C3 C3 C3 Lr) r-3 O r% -- Extra Services & Fees (check box, add tee as appropnate) ❑ Return Receipt (hardcopy) $ ❑ Return Receipt (electronic) $ ❑ Certified Mail Restricted Delivery $ ❑Adult Signature Required $ ❑Adult Signature Restricted Delivery $ Postmark Here $ Robert Warthen, Senior Advisor Sent To NordAq Energy, Inc. Street andAiifwz.,oiPOBoxr 560 E. 34th Ave., Ste. 200 city State, 2h544®------------ Anchorage, AK 99503 ■ Complete items 1, 2, and 3. ■ Print your name and address on the reverse so that we can return the card to you. ■ Attach this card to the back of the mailpiece, or on the front if space permits. Robert Warthen, Senior Advisor NordAq Energy, Inc. 560 E. 34th Ave., Ste. 200 Anchorage;'AK 99503 A. f• gent ❑ Addressee D. Is delivery address different from item 1? El Yes If YES, enter delivery address below: ❑ No UN 12 7 3. Service Type ❑ Priority Mail Expresso I I III' III I'I'I II I III I II II I II I I II II I I I I ❑ Adult SignatureElRegistered Mail ❑ Adult Signature Restricted Deli ❑ Restricted Registered Mail Restricted "ertified Mail@ Delivery 9590 9 4 0 1 005? 5 0 7 L 013 5 6 7 O Certified Mail Restricted Delivery Return Receipt for ❑ Collect on Delivery `Merchandise 9 Artirla Ni imhar (Trancfer from .¢arvirP lahal) ❑Collect on Delivery Restricted Delivery El Signature Confirmation T"' 7 015 0640 0003 5185 5963 urd Mail 11Signature Confirmation gyreed Mail Restricted Delivery Restricted Delivery $500) PS Form 3811, April 2015 PSN 7530-02-000-9053 Domestic Return Receipt Domestic Mail Only ' For delivery information, visit our website at wimmusps.come. Ceaied Mail Fee _■ ■ Complete items 1, 2, and 3. ■ Print your name and address on the reverse so that we can return the card to you. ■ Attach this card to the back of the mailpiece, or on the front if space permits. X s gent rt ❑ Addressee B.B. Rec d me) C. eof Delivery i i D. Is delivery address different from item 1? ❑ Yes ,4YAS, enter delivery address below: ❑ No Andy Mack ❑ Return Receipt (hardcopy) $ Commissioner M M [:]Return Receipt (electronic) $ Postmark O FlCertified Mail Restricted Delivery $ Here r3 ❑ Adult Signature Required $ --�"'--- ---- 3. Service Type Adult Signature Restricted Delivery $ O Postage $ O Total Postage and Fees $ Andy Mack Ln Sent To Commissioner O StieetendAW E,oFAU96 Department of Natural Resources II II II 550 W. 7th Ave., Ste. 1400 I III Ciry State; zTP+d®---------- I II I I II I II I II Anchorage, AK 99501-3561 ■ Complete items 1, 2, and 3. ■ Print your name and address on the reverse so that we can return the card to you. ■ Attach this card to the back of the mailpiece, or on the front if space permits. X s gent rt ❑ Addressee B.B. Rec d me) C. eof Delivery i i D. Is delivery address different from item 1? ❑ Yes ,4YAS, enter delivery address below: ❑ No Andy Mack EIVE® Commissioner Department of Natural Resources MAY 3 0 2017 550 W. 7th Ave., Ste. 1400 Anchorage, AK 99501-3561 --�"'--- ---- 3. Service Type ❑ Priority Mail Express8 ❑Adult Signature ❑ Registered Mail- II I I Ilii I'I II II II I III I III II I II I I II I II I II III 1t Signature Restricted Delivery ❑ Signature ❑Registered Mail Restricted 9590 9401 0057 5071 0135 74 trelified Mail@ ElCertified Mail Restricted Delivery Delivery iiiFiefurn Receipt for Merchandise ❑ Collect on Delivery Fl rn°Act on Delivery Restricted Delivery ❑ Signature Confirmation - ❑ signature Confirmation c . lahall 2. Article Number (Transfer from servi-_P, . _ ?015 0640 0003 518 5 598? ed Mail ed Mail Restricted Delivery Restricted Delivery $500) PS Form 3811, April 2015 PSN 7530-02-000-9053 Domestic Return Receipt Domestic Mail Only ' For delivery information, visit our website at www.usps.com®. Certified Mail Fee ■ Complete items 1, 2, and 3. ■ Print your name and address on the reverse so that we can return the card to you. ■ Attach this card to the back of the mailpiece, or on the front if space permits. nr l�le A,+a.,.,..._ ._. Sophie Minich CIRI President and CEO Cook Inlet Region, Inc. 725 E. Fireweed Ln., Ste. 800 Anchorage, AK 99503 A. ure (N.-'^' ❑Agent X U [3 Addressee B. Received by a ;.:dam C. {fGifDelive 7 1 D. Is delivery address diff ent from item 1? ❑ Yes If YES, enter delivery address_ below: ❑ No ilrl JUN 12 2017 ❑ Return Receipt (hardcopy) $ ❑ Priority Mail Express® M ❑ Return Recelpt (electronic) $ Postmark r-3 ❑ Certified Mail Restricted Delivery $ Here 1:3 1:3 ❑ Adult Signature Required $ ❑ Adult Signature Restricted Delivery $ ❑ Adult Signature O Postage I IIID IIII $ III II E3 Total Postage and Fees Sophie Minich II $ CIRI President and CEO Ln Sent To I III r=1 ❑ Adult Signature Restricted Delivery Cook Inlet Region, Inc. O r� Street and Apt lVo., or PO Box No. 725 E. Fireweed Ln., Ste. 800 City Stale; ziP+4® "" Anchorage, AK 99503 ■ Complete items 1, 2, and 3. ■ Print your name and address on the reverse so that we can return the card to you. ■ Attach this card to the back of the mailpiece, or on the front if space permits. nr l�le A,+a.,.,..._ ._. Sophie Minich CIRI President and CEO Cook Inlet Region, Inc. 725 E. Fireweed Ln., Ste. 800 Anchorage, AK 99503 A. ure (N.-'^' ❑Agent X U [3 Addressee B. Received by a ;.:dam C. {fGifDelive 7 1 D. Is delivery address diff ent from item 1? ❑ Yes If YES, enter delivery address_ below: ❑ No ilrl JUN 12 2017 3. Service Type _. ❑ Priority Mail Express® ❑ Adult Signature ❑ Registered Mailr" II I IIID IIII III II II I III I II II I II I I I III I III ❑ Adult Signature Restricted Delivery C1 Registered Mail Restricted ertified Mail0 Delivery 9590 9401 0057 5071 0135 81 Certified Mail Restricted Delivery �ii#Eturn Receipt for Merchandise E]Collect on Delivery E3Collect on Delivery Restricted Delivery — 0 Signature Confirmation T"' ❑ Signature Confirmation 2. Article Number (Transfer from service label) ?015 0640 0003 5185 5970 ,red Mail lred Mail Restricted Delivery Restricted Delivery it $500) PS Form 3811 , April 2015 PSN 7530-02-000-9053 Domestic Return Receipt AOGCC 4/4/2017 Docket No. OT14-16-031 ALASKA OIL AND GAS CONSERVATION COMMISSION Before Commissioners: Cathy Foerster, Chair Daniel T. Seamount Hollis French In the Matter of the Proposed Enforcement Action Against NordAq Energy, Inc. for Failure to Permanently Abandon the Shadura 1 Before Expiration of Rights in CIRI Oil and Gas Lease C-061648 and 20 AAC 25.105(a) and Failure to Respond to Notice of Proposed Enforcement. Docket No.: OTH 16-031 ALASKA OIL and GAS CONSERVATION COMMISSION Anchorage, Alaska April 4, 2017 10:00 o'clock a.m. PUBLIC HEARING BEFORE: Cathy Foerster Daniel T. Seamount Hollis French Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net AOGCC 4/4/2017 Docket No. OTH-16-031 Page 2 1 TABLE OF CONTENTS 2 Opening remarks by Chair Foerster 03 3 Testimony by Mr. Warthen 4 Testimony by Ms. Miller 5 M. i 9 10 13 14 Wil. 16 17 18 19 20 21 22 23 24 25 Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net AOGCC 4/4/2017 Docket No. OTH-16-031 Page 3 1 P R O C E E D I N G S 2 (On record - 10:00 a.m.) 3 CHAIR FOERSTER: All right. I will call this 4 hearing to order. It is 10:00 a.m. on April 4, 2017. 5 We are in the offices of the Alaska Oil and Gas 6 Conservation Commission at 333 West Seventh Avenue, 7 Anchorage, Alaska. To my left is Commissioner Dan 8 Seamount, to my right is Commissioner Hollis French and 9 I'm Commissioner Cathy Foerster. 10 We're here today for docket number OTH 16-031, 11 failure to plug and abandon Shadura number 1, permit to 12 drill 211-014 and failure to respond to the notice of 13 proposed enforcement action. 14 (Off record comments) 15 COMMISSIONER FRENCH: The subject of the 16 hearing today is AOGCC's proposed enforcement action 17 against NordAq Energy, Inc. for failure to permanently 18 abandon the Shadura number 1 exploratory well before 19 expiration of rights in CIRI oil and gas lease C- 20 061648. Shadura number 1 was drilled within Section 21 23, Township 8 North, Range 10 West, Seward Meridian. 22 Computer Matrix will be recording today's 23 proceedings and you can get a copy of the transcript 24 from Computer Matrix. 25 I see that we have Bob Warthen desiring to Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile a gci.net AOGCC 4/4/2017 Docket No. OTH-16-031 Page 4 1 testify and no one else. The Commissioners will ask 2 the questions during testimony, we may also take a 3 recess to consult with staff to determine whether 4 additional questions need to be asked. If there's a 5 member of the audience who has a desire to have a 6 question asked he or she should give that question to 7 Jody Colombie who's doing the float wave. She'll 8 submit the question to the Commission and if we 9 determine that the questions will assist us in making 10 our determination we will ask them. 11 If you're testifying please keep in mind that 12 you must speak into the microphone so that people in 13 the audience and the court reporter can capture what 14 you say. Also make sure that the green light is bright 15 on. And if you have any slides be sure to reference 16 your slides so that people reading the record in the 17 future can follow along. 18 We have a few rules relative to testimony. 19 Testimony must be relevant to the purposes of the 20 hearing that we discussed a minute ago and to the 21 statutory authority of the AOGCC. Anyone desiring to 22 testify may do so, but if the testimony drifts off 23 subject we will limit the testimony to three minutes. 24 Additionally testimony may not take the form of cross 25 examination. As I said before the Commissioners will Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email• sahile@gci.net AOGCC 4/4/2017 Docket No. OTH-16-031 Page 5 1 be asking the questions. And finally testimony should 2 be respectful. 3 Commissioner Seamount, do you have anything to 4 add for the good of the order before we begin? 5 COMMISSIONER SEAMOUNT: Not at this time, Madam 6 Chair. 7 CHAIR FOERSTER: Commissioner French? 8 COMMISSIONER FRENCH: No. Thank you. 9 CHAIR FOERSTER: Although we did have a hearing 10 involving the same operator at 9:00 o'clock this is a 11 separate hearing and so the operator may be confused 12 and frustrated, but we will be covering the same ground 13 again including the need to swear you in for testimony. 14 All right. Mr. Warthen, state your name and 15 who you represent and then let me swear you in. 16 MR. WARTHEN: Good morning, Commissioners. My 17 name is Robert C. Warthen, Bob Warthen, and I represent 18 NordAq Energy, Inc. 19 CHAIR FOERSTER: Raise your right hand. 20 (Oath administered) 21 MR. WARTHEN: I do. 22 CHAIR FOERSTER: All right. Please proceed 23 with your testimony. 24 MR. WARTHEN: NordAq did in fact..... 25 CHAIR FOERSTER: Oh, would you like to be Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net AOGCC 4/4/2017 Docket No. OTH-16-031 Page 6 1 recognized as an expert witness? 2 MR. WARTHEN: Yes, ma'am, I would. 3 CHAIR FOERSTER: Okay. Please give us your 4 credentials. 5 MR. WARTHEN: Yes, ma'am. I have a bachelor 6 and master of science degree in geology with some post 7 graduate studies in geology. Prior to my arrival in 8 Alaska I worked in various geological positions for the 9 North Dakota Geological Survey, Sinclair Oil and Gas 10 and Continental Oil Company. Upon arriving in Alaska I 11 worked my first 27 years here for Union Oil Company of 12 California in various geologic positions and operations 13 positions and management positions. In 105 I formed 14 NordAq Energy Partners which morphed into NordAq 15 Energy, Inc. a few years later and was incorporated in 16 January of 2009 and have since been connected with 17 NordAq since that time. 18 CHAIR FOERSTER: Okay. Commissioner Seamount, do 19 you have any questions? 20 COMMISSIONER SEAMOUNT: No questions, no 21 comments, no objections. 22 CHAIR FOERSTER: Commissioner French? 23 COMMISSIONER FRENCH: I'll go along with 24 Commissioner Seamount. 25 CHAIR FOERSTER: All right. And I'm fine, no Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net AOGCC 4/4/2017 Docket No. OTH-16-031 Page 7 1 questions and we recognize you as an expert witness. 2 Please proceed with your testimony. 3 MR. WARTHEN: Thank you. 4 BOB WARTHEN 5 previously sworn, called as a witness on behalf of 6 NordAq, testified as follows on: 7 DIRECT EXAMINATION 8 MR. WARTHEN: NordAq did in fact drill Shadura 9 number 1 in the Kenai National Wildlife Refuge and 10 having done that to access that well location we had to 11 cross State park lands as well as State of Alaska 12 lands. We had all intentions of follow-up and drilling 13 a second well updip from the first well approximately 14 one and a half miles due east. And in doing so we 15 would have -- we had to build a gravel road into the 16 Refuge. We did in fact start that endeavor in the fall 17 of 114, August to be exact, and we worked up until 18 snowfall where we did a small portion of that road and 19 then abandoned until the following spring when we were 20 going to come back after the Migratory Bird Treaty Act 21 expired which was July 15 of 115. I believe that was 22 the same date that Cook Inlet Region who owned the 23 subsurface mineral estate in the Kenai National 24 Wildlife Refuge of which NordAq had the leases from, 25 canceled NordAq's lease. There had been some Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email sahile@gci.net AOGCC 4/4/2017 Docket No. OTH-16-031 Page 8 1 discussions prior to that time with Cook Inlet Region 2 indicating that NordAq for various reasons would not go 3 ahead and drill the second well. And so..... 4 CHAIR FOERSTER: What was the date of the 5 lease..... 6 MR. WARTHEN: I believe they canceled the lease 7 July 15,2015. 8 MR. WARTHEN: Okay. Thank you. 9 COMMISSIONER FRENCH: If I could ask just did 10 the cancellation pertain to the proposed drilling site 11 or the existing site? 12 MR. WARTHEN: No, I think -- well, I can't -- I 13 can't say exactly what their reasoning for canceling 14 the leases, but..... 15 COMMISSIONER FRENCH: You misunderstand my 16 question. Just geographically did the lease 17 cancellation affect the proposed drilling site? 18 MR. WARTHEN: Yes, it did? 19 COMMISSIONER FRENCH: And the existing drill 20 site? 21 MR. WARTHEN: Both. 22 COMMISSIONER FRENCH: Both. 23 MR. WARTHEN: Both. 24 COMMISSIONER FRENCH: I understand. Thank you. 25 MR. WARTHEN: Yes. Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahileggci.net AOGCC 4/4/2017 Docket No. OTH-16-031 Page 9 1 COMMISSIONER FRENCH: I don't need..... 2 MR. WARTHEN: Yes. 3 COMMISSIONER FRENCH: .....I don't need the 4 reasons. 5 MR. WARTHEN: Okay. 6 COMMISSIONER FRENCH: We may give that later. 7 I just wanted to make sure I understood. 8 Thank you. 9 MR. WARTHEN: Yeah, both. When NordAq decided 10 that they would not move forward they had discussions 11 with a third party that was interested in taking over 12 the prospect and the project and had an agreement with 13 NordAq to do such, but in order to fulfill that 14 agreement they had to conduct and have an agreement 15 with Cook Inlet Region. And they did in fact have 16 discussions and engaged in discussions with Cook Inlet 17 Region up until I believe January of '16 which failed 18 to materialize. And at that time NordAq talked to CIRI 19 again telling them that the well actually was an asset 20 for them, a case tool (ph) asset and if they had 21 intentions of moving forward on their own which they 22 indicated they might do in shooting 3D seismic and 23 drilling a follow-up well that that well could be used 24 as a sidetrack candidate as well as a utility well or a 25 potential injection or water disposal well. And that Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net AOGCC 4/4/2017 Docket No. OTH-1 6-031 Page 10 1 was the intent that NordAq had for the well all along. 2 CHAIR FOERSTER: So CIRI expressed interest in 3 keeping the well? 4 MR. WARTHEN: At some point they did. 5 CHAIR FOERSTER: Do you know when they did? 6 MR. WARTHEN: Pardon me. 7 CHAIR FOERSTER: At some point? 8 MR. WARTHEN: Yes, I can't say exactly when 9 because there was some hesitancy on their part and I 10 don't know if it had to do with the work that they 11 conducted in their own investigations, subsurface 12 investigation, or if there were other matters that -- 13 you know, that I'm not aware of, but at some point they 14 brought in another party that was interested in a 15 project and, you know, and would take over the entire 16 project as well as the well. I was informed from them 17 on December 30th of 116 that their potential interested 18 party failed to materialize and that NordAq could go 19 ahead and abandon the well. At that point we again 20 contracted -- contacted and contracted our petroleum 21 engineer, Steve Hennigan, who was involved with the 22 drilling of this here project to begin applying for a 23 sundry notice to plug and abandon. We also contacted 24 our permitter who was also involved with this project 25 Cardno-ENTRIX, to start permitting for plugging and Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email• sahile@gci.net AOGCC 4/4/2017 Docket No. OTH-16-031 Page 11 1 abandoning and going through all the agencies that 2 needed to be accessed to do such. And we also 3 contacted our project management team, American 4 Oilfield Services, who drilled the well and we would 5 use their services to go ahead and conduct the 6 operations to plug and abandon the well. 7 We went ahead and contacted the Refuge, we 8 obtained all the necessary permits. I do have a 9 package of the permits here if the Commission desires 10 to see those. They are inclusive of the National 11 Wildlife Refuge permit, the land use permit from the 12 DNR, the Oil and Gas Division, Fish and Habitat 13 permits, Kenai Peninsula permits, the State park 14 permit, water use permit, the letter of non -objection 15 from Tesoro as well as from Hilcorp to cross their 16 pipeline and bring equipment in to abandon the well, a 17 letter of non -objection from CIRI to conduct the 18 operation, certificates of liability that we needed to 19 have to provide to the agencies that required such such 20 as the Kenai Wildlife Refuge as well as the State. And 21 additional to that a master service agreement from All 22 American Oilfield Services. 23 We started to conduct the operation in March, 24 and our operations people said that we could start the 25 operation, but we would never complete it because of Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email• sahile a gci.net AOGCC 4/4/2017 Docket No. OTH-16-031 Page 12 1 the turating (ph) snow conditions, the snow was 2 becoming sugary which would require a lot more water 3 which would create more problems as such. And since 4 NordAq had two entries into the Refuge in conducting 5 this type of operation, the drilling of the well 6 initially with an ice road and follow-up year to test 7 the well with a snow road we knew -- had an idea when 8 it would be best to exit the Refuge without causing any 9 damage. And those dates were April 5th and March 7th 10 in previous years. And of course each year could be 11 different, this year's somewhat different. But we also 12 had some encouragement from the Refuge people in Kenai 13 that they would not be too happy if we got in there and 14 made a mess quite frankly. And we didn't want to do 15 that so we opted to come back in December with all the 16 permits in place. 17 We do have a certificate or a bond in place 18 with the National Wildlife Refuge of some $50,000, we 19 have $1,000 land use permit certificate in place and we 20 also have all the permits and fees paid for. so it is 21 NordAq's intent to continue this operation in December 22 and abandon the location. 23 Again as to why we failed to respond to the 24 initial order or complaint from the Commission is that 25 NordAq's offices were robbed and the tenant on the same Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net AOGCC 4/4/2017 Docket No. OTH-16-031 Page 13 1 floor were robbed and as such we locked down -- the 2 building was locked down, no access by stairwell or 3 elevator and everything had to go through the major 4 building tenant on the first floor. And I personally 5 or NordAq did not receive any of the paperwork from the 6 Commission, the certified letters, until the day before 7 -- well, I think it was the day before New Year's Eve, 8 the 30th of December. 9 That's all I have, Commissioners. 10 CHAIR FOERSTER: Thank you. 11 MR. WARTHEN: I do have this package of 12 everything that I discussed if the Commission would 13 like to have a copy of all..... 14 CHAIR FOERSTER: We'll take a copy of all that. 15 MR. WARTHEN: .....these items. 16 CHAIR FOERSTER: Yes, we'll take a copy of all 17 that. 18 Commissioner Seamount, do you have any 19 questions? 20 COMMISSIONER SEAMOUNT: Yes. Again how much do 21 you estimate it's going to cost to plug this well? 22 MR. WARTHEN: Yeah, this operation will be in 23 the $500,000 range. 24 COMMISSIONER SEAMOUNT: 500,000. 25 MR. WARTHEN: Yes, the equipment is a little Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net AOGCC 4/4/2017 Docket No. OTH-16-031 Page 14 1 bit more specific to, you know, snow road use rather 2 than the other operation, Tucker's, Steiger's, this 3 sort of thing, even though we do have some heavy 4 equipment, to move in on a snow type operation. And of 5 course the wellhead's a little heavier, we have a 6 10,000 pound tree there so there's -- it requires a 7 little heavier crane and some work to pull the cellar. 8 COMMISSIONER SEAMOUNT: Okay. Thank you. 9 That's all I have. 10 CHAIR FOERSTER: Commissioner French? 11 COMMISSIONER FRENCH: No, I don't have any 12 questions. 13 CHAIR FOERSTER: All right. I'm going to ask 14 again what I asked about the previous well, do you know 15 what the condition of the well is? 16 MR. WARTHEN: I -- we -- we may have some open 17 perforations at 9,900 or 10,000 feet. I believe the 18 rest -- everything below that has been plugged. 19 CHAIR FOERSTER: Okay. 20 COMMISSIONER SEAMOUNT: I do have a question 21 that -- you say this well was drilled within the last 22 two years, correct? 23 MR. WARTHEN: No, sir, longer than that. I 24 believe the well..... 25 COMMISSIONER SEAMOUNT: Okay. Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net AOGCC 4/4/2017 Docket No. OTH-16-031 Page 15 MR. WARTHEN: .....was drilled in the winter of 2 '10/'ll. 3 COMMISSIONER SEAMOUNT: Then it's not 4 confidential. What did that well test? 5 MR. WARTHEN: We tested several zones in the 6 Tyonek, we tested several zones at approximately -- the 7 well TD'd at 14,624 feet. We tested some zones at 8 12,000, one zone at 13,000, several zones at 11,000, 9 one zone at about 10,300, just below the nine and five - 10 eighths casings. 11 COMMISSIONER SEAMOUNT: And did you recover 12 hydrocarbons? 13 MR. WARTHEN: Only a small amount. 14 COMMISSIONER SEAMOUNT: Okay. 15 CHAIR FOERSTER: Okay. 16 MR. WARTHEN: We had -- we had a terrible 17 cement job, the initial cement job was poor. We came 18 back a year later when there was probably a lot of 19 leakage behind casing and damage to the reservoirs. 20 The indications on the logs where we had good crossover 21 porosity indicated we did have gas. We recognized the 22 fact that we were downdip, we had the opportunity to go 23 updip and drill a second well some 800 feet 24 structurally updip. 25 COMMISSIONER SEAMOUNT: So the engineer messed Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net AOGCC 4/4/2017 Docket No. OTH-16-031 Page 16 1 it up. That's what I always used to say. 2 CHAIR FOERSTER: All right. I don't have any 3 additional questions for you, but I would like to ask 4 the CIRI representative a question or two. So if the 5 CIRI representative would come up. 6 State your name and who you represent for the 7 record and then I'll swear you in. 8 (Off record comments - microphone) 9 MS. MILLER: Colleen Miller. 10 CHAIR FOERSTER: And you represent CIRI? 11 MS. MILLER: Yes. 12 CHAIR FOERSTER: Okay. 13 MS. MILLER: I represent CIRI. 14 CHAIR FOERSTER: Okay. Would you raise your 15 right hand. 16 (Oath administered) 17 MS. MILLER: I do. 18 COLLEEN MILLER 19 called as a witness on behalf of CIRI, testified as 20 follows on: 21 DIRECT EXAMINATION 22 CHAIR FOERSTER: Okay. Do you -- have you -- 23 did you listen to everything that Mr. Warthen said? 24 MS. MILLER: I did, yes. 25 CHAIR FOERSTER: Was the testimony he provided Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net AOGCC 4/4/2017 Docket No. OTH-16-031 Page 17 1 -- the facts that he provided, were they consistent 2 with your understanding of the chronology, the 3 agreements, et cetera? 4 MS. MILLER: We -- I don't recall ever -- well, 5 to my knowledge we never expressed interest in keeping 6 the well open until I was -- we were asked in late 7 December of 2016. Then we decided to -- you know, we 8 kind of inquired on whether or not it would be worth it 9 and then we decided that it was probably not something 10 that we were interested in going after so we let Bob 11 know and this was late 2016. 12 Going back the leases were terminated because 13 there were multiple commitments within our leases that 14 they did not meet and we extended them several times 15 trying to accommodate NordAq, but then as the funding 16 never came we decided the funding likely would not come 17 and I think as everybody knows that the public court 18 case that's going on right now is probably a reason why 19 there was never going to be any funding. So..... 20 CHAIR FOERSTER: Okay. 21 MS. MILLER: Yeah. 22 CHAIR FOERSTER: Thank you. 23 MS. MILLER: Yeah. 24 CHAIR FOERSTER: Commissioner Seamount, do you 25 have any questions? Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahile@gci.net AOGCC 4/4/2017 Docket No. OTH-16-031 Page 18 1 COMMISSIONER SEAMOUNT: I have none. 2 CHAIR FOERSTER: Commissioner French? 3 COMMISSIONER FRENCH: No, thank you. 4 CHAIR FOERSTER: Thank you so much for coming 5 up here and..... 6 MS. MILLER: Sure. 7 COMMISSIONER FRENCH: .....and allowing us to 8 surprise you. 9 MS. MILLER: Yeah. 10 CHAIR FOERSTER: All right. Is that..... 11 MR. WARTHEN: Yes, I'd say one more thing on 12 that order. As Colleen suggested there were financial 13 improprieties going on within NordAq and there were 14 difficulties. I think CIRI realized that and that's 15 probably the main reason why they canceled the leases. 16 CHAIR FOERSTER: Financial improprieties? 17 MR. WARTHEN: Yes, I..... 18 CHAIR FOERSTER: Okay. That's fine. 19 MR. WARTHEN: Right. 20 CHAIR FOERSTER: That's not part of this 21 hearing. 22 MR. WARTHEN: No. 23 CHAIR FOERSTER: All right. If there's no one 24 else wishing to testify, do you have anything for the 25 good of the order before we adjourn? Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email: sahileggci.net AOGCC 4/4/2017 Docket No. OTH-16-031 Page 19 1 COMMISSIONER SEAMOUNT: No. 2 CHAIR FOERSTER: Commissioner French? 3 COMMISSIONER FRENCH: No, thank you. 4 CHAIR FOERSTER: All right. At 10:20 a.m. this 5 hearing is adjourned. 6 (Hearing adjourned 10:20 a.m.) 7 (END OF REQUESTED PORTION) 8 9 mile] 13 14 15 16 17 18 19 WAI] 21 22 23 24 25 Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email• sahile a gci.net AOGCC 4/4/2017 Docket No. OTH-16-031 Page 20 1 TRANSCRIBER'S CERTIFICATE 2 I, Salena A. Hile, hereby certify that the 3 foregoing pages numbered 02 through 20 are a true, 4 accurate, and complete transcript of proceedings in re: 5 Docket No.: OTH 16-031 public hearing, transcribed 6 under my direction from a copy of an electronic sound 7 recording to the best of our knowledge and ability. 8 Date 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 1 25 Salena A. Hile, Transcriber Computer Matrix, LLC Phone: 907-243-0668 135 Christensen Dr., Ste. 2., Anch. AK 99501 Fax: 907-243-1473 Email• sahile@gci.net STATE OF ALASKA ALASKA OIL AND GAS CONSERVATION COMMISSION Docket No. OTH-16-032 April 4, 2017 at 9:00 am NAME AFFILIATION Testify (yes or no) leve rNz)ay.� G% 1&,oCT cC 1yG THE STATE "ALASKA GOVERISTOR BILL WALKER Alaska Oil and Gas Conservation Commission Robert Warthen APR 4 4 2017 Sr. Advisor NordAq Energy, Inc. 560 E 34th St. Anchorage, AK 99503-4161 Re: Exploratory Field, Exploratory Pool, TEC (41-24) 1 Permit to Drill Number: 212-102 Sundry Number: 317-083 Dear Mr. Warthen: 333 West Seventh Avenue Anchorage, Alaska 99501-3572 Main: 907.279.1433 Fax: 907.276.7542 www.aogcc.alaska.gov Enclosed is the approved application for sundry approval relating to the above referenced well. Please note the conditions of approval set out in the enclosed form. As provided in AS 31.05.080, within 20 days after written notice of this decision, or such further time as the AOGCC grants for good cause shown, a person affected by it may file with the AOGCC an application for reconsideration. A request for reconsideration is considered timely if it is received by 4:30 PM on the 23rd day following the date of this letter, or the next working day if the 23rd day falls on a holiday or weekend. Sincerely, Cathy . Foerster Chair DATED this day of March, 2017. STATE OF ALASKA ALASKA OIL AND GAS CONSERVATION COMMISSION APPLICATION FOR SUNDRY APPROVALS 2n AAc 95 9Rn F=E - 15 2517 1. Type of Request: Abandor® Plug for Redrill Perforate New Pool11 Repair WeLi Change Approved PrograL Suspen� Plug Perforations Perforate El Pull Tubing Time Extensi Operations Shutdow Re-enter Susp. Well Stimulate Alter Casin Other: Flow Test 2. Operator Name: 4. Current Well Class: 5. Permit to Drill Number: NordA Ener , InC Exploratory Development 212-102 ® 6.APINumber. Stratigraphic Service39997 3. Address: j(pC� E - 34�SE• �o(?Qck�--Ag60-3 449 9&W `NCe( 50-133.20605-00-00 7. If perforating: era 8. Well Name and Number: What Regulation or Conservation Order governs well spacing in this pool? 659 Co Tiger Eye Central (41-24) # 1 perforations require a spacing exception? Yes No 9. Property Designation (Lease Number): 10. Field/Pool(s): ADL 391104 and Private Fee land Wildcat (W Cook Inlet area) () 11. PRESENT WELL CONDITION SUMMARY Total Depth MD (ft): Total Depth TVD (ft): Effective Depth MD (ft): Effective Depth TVD (ft): Plugs (measured): Junk (measured): 10750' 10157' 7811' 7219' Casing Length Size MD TVD Burst Collapse Structural 141' 20 141 141' na 770 Conductor 808' 13 3/8" 808 807' 2450 1950 Surface 4560' 95/81, 4,560 3968' 5750 3090 Intermediate 3557' 7 7,945 7353' 7240 5410 Open Hole 0 10,750 10157' 0 0 Liner Perforation Depth MD (ft): Perforation Depth TVD (ft): Tubing Size: Tubing Grade: Tubing MD (ft): various (see WBD) various (see WBD) 2.875 6.4ppf N80 mdfd Packers and SSSV Type: Packers and SSSV MD (ft) and TVD (ft): see WBD MD Baker FH see WBD TVD 12. Attachments: Description Summary of Proposal 13. Well Class after proposed work: Detailed Operations Program ! BOP Sketch I ! 1 Exploratory Stratigraph Developmenil i Service ! f 14. Estimated Date for 15. Well Status after proposed work: Commencing Operations: Oil Gas 4 1 i WDSPL Suspended WINJ GINJ u WAGAbandoned 16. Verbal Approval: Date: Commission Representative: 8 GSTOR SPLUG 17. 1 hereby certify that the foregoing is true and correct to the best of my knowledge. Stephen Hennigan ph 337 849-5345 or Bob Warthen Contact Email Shennigan peiinc.com Printed Name Robert Wirthen Title Sr. Advisor, NordAq Energy, LLC Signaturef `L � � / , Phone /Date ; �® (907) ik 646-9315 r . 9 >' 4l • s r COMMISSION USE 91NLY f Conditions of approval: Notify Commission so that a representative may witness Sundry Number: '& Plug Integrity BOP Test Mechanical Integrity Test E] Location Clearance Other: ls�f�/L � a �o � c. P k e u j CA Snlz i -z c — 13.71 ,� Spacing Exception Required? Approved by: _, cf ,_, Yes 0 No r • r Subsequent Form Required: APPROVED BY COMMISSIONER THE COMMISSION Date: 3" 7— Submit Form and Form 30-403 (Revised 10/2012) Approved application is valid for 12 months from the date of approval. Attachments in Duplicate DUPLICATE -wKr;wier.,e er,n•. �.^. Fra at.+sxA s �_. -. .. - ,. ...; . January 5, 2017 Ms. Cathy Foerster, Chair Alaska Oil and Gas Conservation Commission 333 West 7th Avenue, Suite 100 Anchorage, AK 99501 RE: Request for Sundry Approval to Plug and Abandon NordAq Energy, LLC Tiger Eye Central (41-24) (PTD No. 212-102, Sundries 313-324,313-239, 313-172, 313-105) Dear Ms. Foerster, �0! NordAq Energy, LLC hereby applies for Sundry documentation to plug and abandon the above referenced well. The well was drilled to test the production potential of the Middle Tyonek and Hemlock formations on the west side of the Cook Inlet near Kustatan point. Total depth was reached on November 21, 2012. There were issues performing an OH evaluation with Elogs and subsequently the lower formations and zones of interest were cemented and secured. A 7" liner was then run and cemented above the plug. The well was secured and suspended. The first approved Sundry 313-105 calls "for multiple intervals in the Tyonek to be completed using conventional thru tubing wire line guns to perforate, swab and then flow test. Additional zones of interest may be added with additional wire line perforations, swabbing and then flow testing. The zone will then be isolated. This will be repeated until all zones of interest in the T' are tested." The thru tubing perforating appeared to be inadequate. The second approved Sundry 313-172, was that following Sundry 313-105. "a well servicing rig will be mobilized to pull tubing and packer. The shallower intervals in the Sterling will be evaluated in a similar manner." NordAq proposed that Sundry 313-105 be terminated after the second perforation, the rig be rigged up, AOGCC inspectors inspect the rig, and then proceed with the well testing using tubing and packers in the lower zones as well as continue with Sundry 313-172 in the upper zones. This resulted in Sundry 313-239. 'KNLwlI.EG(iF. ,AhO v�S.�CM: rP.R Ai.eax a' During the work allowed by Sundry 313-239, another sundry was requested and granted to run a 7" tieback to isolate zones perfect and tested by the previous and to plug down to retest a zone that was tested previously. This was Sundry 313-324. If you have any questions or require additional information, please contact Stephen Hennigan at (337) 849-5345 or Robert Warthen, Senior Adviser, NordAq Energy, LLC @ (907) 646-9315. Sincere Rdbert Warthen Senior Advisor NordAq Energy, LLC Enclosures Cc: Pete Dickinson All American Oilfield Stephen F. Hennigan Petroleum Engineers Consulting Project Engineer for NordAq Energy, LLC The information contained in this CIRI email message may be privileged, confidential and protected from disclosure. If you are not an intended recipient, please notify the sender by reply email and delete the message and any attachments immediately. The use, disclosure, dissemination, distribution or reproduction of this CIRI message or the information in it or attached to it by any unintended recipient is unauthorized, strictly prohibited by the sender, and may be unlawful. Thank you. March 14, 2017 Robert Warthen Nordaq Energy, Inc. 560 East 34th Street, Suite 200 Anchorage, AK 99503 Re: Letter of Non -Objection, plugging and abandoning Tiger Eye Central #1 Dear Robert Warthen, On March 14, 2017, CIRI received notice from Nordaq Energy that it would be plugging and abandoning the Tiger Eye Central #1 well, which passes through a shallow interval of CIRI's subsurface estate and bottom holes on State of Alaska lands. The well was drilled and previously covered under the terms of CIRI lease C- 061677. CIRI does not object to the plugging and abandoning of the Tiger Eye Central #1 well in accordance with any applicable State regulation requirements (20 AAC 25.112). Colleen Miller Manager, Resources SURFACE ACCESS & USE AGREEMENT ROAD EASEMENT STATE OF ALASKA } THIRD JUDICIAL DISTRICT } KNOW ALL MEN BY THESE PRESENTS: That the undersigned, Salamatof ("Grantor" or "Salamatof `), the owner of the real estate hereinafter described, whose address is [ADDRESS], for valuable consideration received, does hereby grant, convey, and warrant unto Nordaq Energy Inc. ("Grantee" or "Nordaq"), a Delaware corporation qualified and authorized to do business in Alaska, whose address is 3000 A Street, Suite 410, Anchorage, Alaska 99503 and unto its agents, employees, contractors, invitees, licensees, representatives, successors and assigns, the right, right-of-way and easement in, over, under, through and across the following real estate (hereinafter called the "Lands") in the Kenai Borough, Kenai Recording District, State of Alaska, to wit: See EXHIBIT "A" ATTACHED HERETO FOR LEGAL DESCRIP11ON OF THE LANDS THE RIGHT TO enter upon and use a portion of the surface estate as hereinafter described in Exhibit A, together with an access route thereto for unrestricted transportation of vehicles, materials, equipment, personnel and products to and from the drill site location(s) pursuant to all local and state regulations. TO ENTER UPON, OCCUPY, AND USE such portion or portions of said land for the purposes of surveying; clearing; constructing or placing on, in or under; using; maintaining; or repairing such roads, utilities, and pipelines as is necessary or desirable (from time to time, in the reasonable opinion of Grantee or its successors or assigns) for or in connection with the exploration for, development, or production of oil, gas, or associated substances from State of Alaska Oil and Gas Leases ADL 391103 and 391104 or any lands, leases or other interests pooled or unitized therewith or for storing, using, maintaining or repairing equipment used in connection therewith by Grantee, its successors and assigns and its or their employees, agents, contractors, invitees, licensees, representatives and assigns; Page I Error: Unknown document property name, L'd 0LV9-£8Z-L06 Meo Auued d6£:LO ZL Co 6ny TO HAVE AND TO HOLD said right, right-of-way and easement unto Grantee and its successors and assigns until 2022, and so long thereafter as oil, gas, or associated substances are produced from, or are capable of being produced from State of Alaska Oil and Gas Leases ADL 391103 and 391104 or any lands, leases or other interests pooled or unitized therewith. The final locations of access road(s) and pipeline(s) shall be determined by Grantee, in consultation with Grantor. Grantor hereby expressly releases and waives any right of homestead he may have in and to the Lands. Nothing herein shall be deemed to constitute a relinquishment by Grantee of or otherwise to diminish any rights already held by Grantee in and to the Lands. In consideration of this grant the parties agree: (a) Grantee shall pay Grantor an easement fee of 1 percent (1%) of one hundred percent (100%) of gross production attributable to the Subject. Leases. Payments shall be made to Salamatof within forty-five (45) days of the last day of the calendar month following the month in which oil, gas or associated substances are produced or thirty (30) days from the date of payment receipt by Nordaq, whichever occurs first. Payments shall be made in the form of certified check, unless otherwise agreed, and shall be made on the basis of values used to calculate royalty amounts due the State of Alaska. All payments are to be sent to Salamatof at the following address: P.O. Sox 2682, Kenai, AIS, 99611. (b) Grantor, his heirs or assigns, shall without obligation of maintenance, have the right to use all access road and pipeline corridors for any and all passage purposes; provided that neither Grantee nor any of its successors or assigns shall be liable for any injury or damage to Grantor or third persons resulting from such use. Grantor shall indemnify Grantee for damages caused by Grantor. (c) Upon relinquishment, termination or expiration of Grantee's rights hereunder, Grantee will leave all improvements to Grantor, such as roads. (d) Upon the cessation of all drilling operations and/or production, Grantee will proceed with reasonable diligence to restore the surface of the Lands improved by Grantee to as near its original condition as practicable, except for the improvements which are to remain as outlined in (c), above. Grantee shall be responsible for all reclamation required by state or federal laws, regulations, or permits. Such reclamation shall be performed by Grantee at Grantee's expense in accordance with applicable law and completed within one year after termination of Grantee's interest in the property (e) Grantee shall pay any -real personal property taxes, and any other applicable taxes, Page 2 Error; Unknown document property name Z -d OLb9-£9Z-L06 Apso Auued d6£:LO U £0 6ny applied to the easement during the time the surface use agreement is enforced. All income taxes will be the responsibility of the individual Parties to this Agreement. (f) Grantee shall be responsible for all State of Alaska, local government, and federal permits and licenses and shall not violate any federal, state, or local laws or regulations in the performance of this Agreement and shall be solely responsible for such violations. (g) Grantee shall provide proof of insurance coverage for all operations hereunder and shall indemnify and/or name Grantor as an additional insured under any applicable policies of insurance. (h) Grantee shall not in any way cause any liens or encumbrances to jeopardize in any way Grantor's right, title, or interest in the properties. (i) If any clause or provision herein contained shall be determined to be invalid it shall not affect the validity of any other clause or provision of this Agreement. 6) This Agreement shall be interpreted in accordance with the laws of the State of Alaska. (k) This Agreement may not be modified or altered or amended except by written agreement accepted by both Parties. Furthermore, this document constitutes the entire Agreement between the parties and no other agreement oral or written shall have any force or effect. (1) The Parties agree to take any and all actions necessary to carry out the intent of this Agreement. Page 3 Error! Unknown docurnent property name. £'d OL179-£8Z-LO6 4130 AUUBd dW:LO Zl CO Ent/ IN WITNESS WHEREOF, THIS INSTRUMENT IS EXECUTED THIS 314 day of 6ICrees / )2012. By: [NAME) Pi-e4o dcr, 4-11r"g o /jfa-�.�.< LtSSoc�'a J�•aq�-�/7C'. STATE OF ALASKA ) THIRD JUDICIAL DISTRICT The foregoing instrument was acknowledged before me by [NAME] this Aj'' day of .=AG{A&42&- 2012. Witness my hand and official seal the day and year last written above. r k. 69&2 Notary Publi or the State o Alaska My Commission expires g 4 Gyp NAME STATE OF ALASKA THIRD JUDICIAL DISTR C The foregoing instrument was acknowledged before me by (NAMEl this ay of . 20i2. Witness my hand and official seal the day and year last written above Notary Public for the State of Alaska My Commission expires Page 4 Error! Unknown document property name. 17-d OLtr9-69Z-L06 AP80 4uu8d dW.LO Zl Co End EXHIBIT A Lands The Lands comprise [PARCELS/TRACTS], as described below. DESCRIPTION AS FOLLOWS FOR [PARCELS/TRACTS]: [ADD LEGAL DESCRIPTION] Error: Unknown document property name. 5d OLV9-£9Z-L06 App -0 Auued dob:LO Z 6 CO 6ny August 6, 2012 Kim Kruse, Petroleum Land Manager Alaska Department of Natural Resources 550 W 7th Avenue, Suite 1100 Anchorage, Alaska 99501 Re: DOG Statewide Oil and Gas Bond Dear Mrs. Kruse: L DIVISION OF OILAND GAS Pursuant to the requirements of I AAC 83.160, the State of Alaska, Department of Natural Resources, Division of Oil and Gas (DOG) is named as Beneficiary on a $500,000 Certificate of Deposit No. 9422389560 issued in the sole favor of DOG by Wells Fargo Bank of Anchorage, AK, a bank authorized to do business in the State of Alaska. The purpose of this letter is to confirm to DOG that the Certificate of Deposit is intended to serve as the Oil and Gas lease bond for oil and gas activities for leases that are held by Nordaq Energy, Inc. The undersigned, Robert Warthen, is the President of Nordaq Energy, Inc. and is in all matters authorized to sign this letter on behalf of Nordaq Energy, Inc. As such, the undersigned attests and certifies as follows: 1. Nordaq Energy, Inc. agrees to allow the Nordaq Energy Inc. Statewide Oil and Gas Lease Bond to serve as the performance guarantee of Nordaq Energy, Inc. with respect to State of Alaska oil and gas lease operations within the state of Alaska 2. Nordaq Energy, Inc. grants to the State of Alaska, acting through the DOG or otherwise, the right to exercise the Nordaq Energy, Inc. Bond LOC as the performance guaranty of Nordaq Energy, Inc. with respect to all obligations under the leases. We trust that this letter, along with the completed bond form and Certificate of Deposit 49422389560 satisfies DOG's requirements with respect to the required performance guaranty of Nordaq Energy, Inc. Should you need any further information in this regard, please contact the undersigned. Warthen, President ACKNOWLEDGEMENT THE STATE OF ALASKA§ This instrument was acknowledged before me on this the 13th day of January 2011, by Robert Warthen, Manaein2 Member of Nordaq Energy, Inc. ��►�ot�o�rur'i �2� �---� Notary Public, State of Al My Commission Expires: 1m AUB��G Colombie, Jody J (DOA) From: Regg, James B (DOA) Sent: Monday, June 25, 2018 2:02 PM To: Colombie, Jody 1 (DOA) Subject: FW: Tiger Eye Attachments: Tiger Eye Clearance 6-22-2018.pdf Jim Regg Supervisor, Inspections AOGCC 333 W.7th Ave, Suite 100 Anchorage, AK 99501 907-793-1236 CONFIDENTIALITY NOTICE: This e-mail message, including any attachments, contains information from the Alaska Oil and Gas Conservation Commission (AOGCC), State of Alaska and is for the sole use of the intended recipient(s). It may contain confidential and/or privileged information. The unauthorized review, use or disclosure of such information may violate state or federal law. If you are an unintended recipient of this e-mail, please delete it, without first saving or forwarding it, and, so that the AOGCC is aware of the mistake in sending it to you, contact Jim Regg at 907-793-1236 orjim.regg@alaska.gov. -----Original Message ----- From: Christopher Monfor [mailto:cmonfor@salamatof.com] Sent: Monday, June 25, 2018 1:53 PM To: Robert Warthen <rwarthen@nordaqenergy.com> Cc: Regg, James B (DOA) <jim.regg@alaska.gov>; Colleen Miller <cmiller@ciri.com>; David Pfeiffer <dpfeiffer@nordaqenergy.com>; Sharon Williford <Sharon@salamatof.com> Subject: RE: Tiger Eye M. The only correspondence I have received has been from you and Jim Regge. We did a fly over ourselves after your email and saw the pad was cleared. Jim has been mailed a copy of our clearance approval. I am attaching the letter electronically to this email for your records. -----Original Message ----- From: Robert Warthen <rwarthen@nordaqenergy.com> Sent: Monday, June 25, 20181:31 PM To: Christopher Monfor <cmonfor@salamatof.com> Cc: Regg, James B (DOA) <jim.regg@alaska.gov>; Colleen Miller <cmiller@ciri.com>; David Pfeiffer <dpfeiffer@ nordagenergy.com> Subject: Tiger Eye Mr Monfor: Have you received the photos and commentary from Halliburton and Glacier Foremen to aid in your decision on the Tiger Eye Site Clearance approval? Thanks, Bob. Robert Warthen Senior Advisor NordAq Energy, Inc. 560 East 34th St. Suite 200 Anchorage, Alaska 99503 907.646.9315 main 907.375.1816 direct 907.646.9317 fax rwarthen@nordaqenergy.com This message and any attachments are the property of NordAq Energy Inc. and are intended solely for the named recipients or entity to whom this message is addressed. If you have received this message in error, please inform the sender via e-mail and destroy the message. If you are not the intended recipient, you are not allowed to use, copy, or disclose the contents or attachments in whole or in part. sALAMAN INC Jim Regg Supervisor, Inspections AOGCC 333 W. 7t6 Ave, Suite 100 Anchorage, AK 99501 June 22, 2018 Dear Mr. Regg, Salamatof Native Association, Inc. Post Office Box 2682 Kenai, Alaska 99611 Phone(907)283-7864 Salamatof Native Association, Inc. is the owner of the surface estate for the Tiger Eye Central Exploration project operated by NordAq Energy. We have a surface Access and Use Agreement Dated August 2012, which states that the lands be restored to as near its original condition as practicable. Salamatof Native Association, Inc. is satisfied to these conditions. Please accept this letter as a Site Clearance Approval. Sincerely, Christopher Monfor President/CEO Colombie, Jody J (DOA) From: Regg, lames B (DOA) Sent: Friday, June 22, 2018 3:47 PM To: Foerster, Catherine P (DOA); French, Hollis (DOA); Seamount, Dan T (DOA) Cc: Colombie, Jody J (DOA); Ballantine, Tab A (LAW) Subject: FW: Equipment Tiger Eye Pad. Attachments: 2017-1218 TigerEye Locationjpg; TigerEye Location photos - equip removed 6-21-2018.docx Recall the Tiger Eye location clearance approval was waiting on Nordaq to remove cementing equipment. Attached is a photo of the equipment at Tiger Eye pad that Hollis and I observed during location inspection 12/18/17, and photos taken by Halliburton and Cook Inlet Energy after the cement plant was removed on 6/21/18. 1 have asked Chris Monfor (President/CEO, Salamatof Native Association) for confirmation that they are satisfied with the location. Per our Docket, there are 2 notice of proposed enforcement actions against Nordaq for Shadura (OTH 16-031) and Tiger Eye (OTH 16-032) — missing data, failure to abandon, and fail to respond to enforcement action. Both remain open. Nordaq has completed P&A and location inspections at both well locations (AOGCC witnessed). Meredith confirmed we have received all required data from Nordaq. Do these enforcement actions need to be closed out before we issue location clearance and release Nordaq's bond? Jim Regg Supervisor, Inspections AOGCC 333 W.7'^ Ave, Suite 100 Anchorage, AK 99501 907-793-1236 CONFIDENTIALITY NOTICE: This e-mail message, including any attachments, contains information from the Alaska Oil and Gas Conservation Commission (AOGCC), State of Alaska and is for the sole use of the intended recipient(s). It may contain confidential and/or privileged information. The unauthorized review, use or disclosure of such information may violate state or federal law. If you are an unintended recipient of this e-mail, please delete it, without first saving or forwarding it, and, so that the AOGCC is aware of the mistake in sending it to you, contact Jim Regg at 907-793-1236 or im.reggOalaska.gov. From: Robert Warthen[mailto:rwarthen@nordagenergy.comj Sent: Friday, June 22, 2018 8:12 AM To: cmonfor@salamatof.com; Regg, James B (DOA) <jim.regg@alaska.gov> Cc: Colleen Miller <cmiller@ciri.com> Subject: Fwd: Equipment Tiger Eye Pad. Chris / Jim: An additional photo of the cleared Tiger Eye Pad that Halliburton took yesterday when the removal operation was completed. Bob. Robert Warthen Senior Advisor NordAq Energy, Inc. 560 East 34th St. Suite 200 Anchorage, Alaska 99503 907.646.9315 main 907.375.1816 direct 907.646.9317 fax rwarthenPnordageneray.com This message and any attachments are the property of NordAq Energy Inc. and are intended solely for the named recipients or entity to whom this message is addressed. If you have received this message in error, please inform the sender via e-mail and destroy the message. If you are not the intended recipient, you are not allowed to use, copy, or disclose the contents or attachments in whole or in part. Begin forwarded message: From: Mark Dean <Chris.Dean(a)HaIli burton.com> Subject: RE: Equipment Tiger Eye Pad. Date: June 21, 2018 at 5:02:10 PM AKDT To: Robert Warthen <rwarthen(@nordagenergv.com> Cc: Scott Odell <Scott.ODell(a)Halliburton.com>, Jeremy Talarovich <Jeremy.TalarovichpHalliburton.com>, Raymond Wonders <Raymond.Wonders(a)Halliburton.com> Hi Bob, Everything has gone to plan thus far and Tiger Eye is officially clear. Attached is a picture. Wish I could have snagged an Arial view, but we're fresh out of drones. We're catching the last barge out tonight and all of our equipment will be back to OSK tomorrow. The long wait is finally over! Thanks again for your patience. We look forward to working with you in the future. Mark Dean Cement Service Coordinator Email: chris.dean(&halliburton.com 6900 Arctic Boulevard Anchorage, AK Office: +1 907-275-2613 Mobile: +1303-506-8462 Follow Halliburton: Linkedln I Facebook I Twitter I YouTube I Blog 111111, NAWBUATON -----Original Message ----- From: Robert Warthen[mailto:rwarthen@nordagenergy.com] Sent: Thursday, June 21, 2018 3:42 PM To: Mark Dean Cc: Scott Odell; Jeremy Talarovich Subject: [EXTERNAL] Re: Equipment Tiger Eye Pad. External Sender: Use caution with links/attachments. Hi Mark: Did everything go as planned at Tiger Eye? Any photos taken would be greatly appreciated if you could forward a copy tome. Thanks, Bob. Robert Warthen Senior Advisor NordAq Energy, Inc. 560 East 34th St. Suite 200 Anchorage, Alaska 99503 907.646.9315 main 907.375.1816 direct 907.646.9317 fax rwarthen@nordagenerey.com This message and any attachments are the property of NordAq Energy Inc. and are intended solely for the named recipients or entity to whom this message is addressed. If you have received this message in error, please inform the sender via e-mail and destroy the message. If you are not the intended recipient, you are not allowed to use, copy, or disclose the contents or attachments in whole or in part. > On Jun 20, 2018, at 2:20 PM, Mark Dean <Chris.Dean@Halliburton.com> wrote: > Hi Bob, > Our Supervisor in Charge (Ryan Moat) has been in contact with Glacier. Hilcorp has offered to take them if Glacier falls through, so the mats shouldn't be an issue. We've made great progress out there and everything should be off of Tiger Eye by morning. I'll make sure to send some pictures when complete. Thanks for your patience on this move. > Mark Dean > Cement Service Coordinator > Email: chris.dean@halliburton.com > 6900 Arctic Boulevard Anchorage, AK > Office: +1907-275-2613 > Mobile: +1303-506-8462 > Follow Halliburton: Linkedln I Facebook I Twitter I YouTube I Blog > -----Original Message----- > From: Robert Warthen[mailto:rwarthen@nordaoenerev.com] > Sent: Wednesday, June 20, 2018 2:11 PM > To: Mark Dean > Cc: Scott Odell > Subject: [EXTERNAL] Equipment Tiger Eye Pad. > External Sender: Use caution with links/attachments. > Hi Mark: > I assume that the silos, etc are currently being moved off of the Tiger Eye Pad. In contact > with Glacier, they have told me that they will remove the rig mats (on which your equipment sets on), > once everything is moved. Has any Glacier employee from West Mac contacted your crew to > coordinate this mat issue? Thanks, > Bob. > Robert Warthen > Senior Advisor > NordAq Energy, Inc. > 560 East 34th St. Suite 200 > Anchorage, Alaska 99503 > 907.646.9315 main > 907.375.1816 direct > 907.646.9317 fax > rwarthen@nordaaeneray.com > This message and any attachments are the property of NordAq Energy Inc. and are intended solely for the named recipients or entity to whom this message is addressed. If you have received this message in error, please inform the sender via e-mail and destroy the message. If you are not the intended recipient, you are not allowed to use, copy, or disclose the contents or attachments in whole or in part. > This e-mail, including any attached files, may contain confidential and privileged information for the sole use of the intended recipient. Any review, use, distribution, or disclosure by others is strictly prohibited. If you are not the intended recipient (or authorized to receive information for the intended recipient), please contact the sender by reply e-mail and delete all copies of this message. 4' _,I m Location Clearance - Tiger Eye Pad Photos (June 2018) Email dated 6/21/2018 (R. Wathen, Nordaq Energy Inc.) Tiger Eye Pad — Location Photos 6/2018 Page 1 of 2 Tiger Eye Pad — Location Photos 6/2018 Page 2 of 2 Carlisle, Samantha J (DOA) From: Carlisle, Samantha J (DOA) Sent: Wednesday, January 25, 2017 11:22 AM To: 'Robert Warthen' Subject: RE: Meeting. Great, T will add it to the calendar. Thank you. From: Robert Warthen [mailto:rwarthen@nordaqenergy.com] Sent: Wednesday, January 25, 2017 11:21 AM To: Carlisle, Samantha J (DOA) <samantha.carlisle @alaska.gov> Subject: Re: Meeting. Thanks Samantha, this will work fine for me. Bob Robert Warthen Senior Advisor NordAq Energy, Inc. 560 East 34th St. Suite 200 Anchorage, Alaska 99503 907.646.9315 main 907.375.1816 direct 907.646.9317 fax rwarthen(c)-nordagenergy.com This message and any attachments are the property of NordAq Energy Inc. and are intended solely for the named recipients or entity to whom this message is addressed. If you have received this message in error, please inform the sender via e-mail and destroy the message. If you are not the intended recipient, you are not allowed to use, copy, or disclose the contents or attachments in whole or in part. On Jan 25, 2017, at 10:54 AM, Carlisle, Samantha J (DOA) wrote: Bob - is 2pm tomorrow a good time for you? 1 From: Robert Warthen [mailto:rwarthen@nordagenergy.com] Sent: Wednesday, January 25, 2017 9:11 AM To: Carlisle, Samantha J (DOA) <samantha.carlisle@alaska.gov> Subject: Re: Meeting. Much appreciated Samantha. Bob. Robert Warthen Senior Advisor NordAq Energy, Inc. 560 East 34th St. Suite 200 Anchorage, Alaska 99503 907.646.9315 main 907.375.1816 direct 907.646.9317 fax rwarthen(a�nordagenergy.com This message and any attachments are the property of NordAq Energy Inc. and are intended solely for the named recipients or entity to whom this message is addressed. If you have received this message in error, please inform the sender via e-mail and destroy the message. If you are not the intended recipient, you are not allowed to use, copy, or disclose the contents or attachments in whole or in part. On Jan 25, 2017, at 8:50 AM, Carlisle, Samantha J (DOA) wrote: I h Bob, I will be in touch with you soon, I am waiting to see what Guy Schwartz's schedule is like and then we can set up a meeting. Thanks! From: Robert Warthen [mailto:rwarthen@nordagenergV.com] Sent: Tuesday, January 24, 2017 10:05 AM 2 To: Carlisle, Samantiw J (DOA) <samantha.carlisle@alaska.gov> Subject: Re: Meeting. Thanks Samantha. I'd really like to talk with Staff on the scheduled hearing on April 4th. Bob. Robert Warthen Senior Advisor NordAq Energy, Inc. 560 East 34th St. Suite 200 Anchorage, Alaska 99503 907.646.9315 main 907.375.1816 direct 907.646.9317 fax rwa rthen (d), no rdagenergy. com This message and any attachments are the property of NordAq Energy Inc. and are intended solely for the named recipients or entity to whom this message is addressed. If you have received this message in error, please inform the sender via e-mail and destroy the message. If you are not the intended recipient, you are not allowed to use, copy, or disclose the contents or attachments in whole or in part. On Jan 24, 2017, at 8:40 AM, Carlisle, Samantha J (DOA) wrote: Bob, Staff is reviewing the Sundry's and have said that if they need to have a. meeting to get more information that we will be in touch next week to arrange that. Please let me know if you have any questions. Thank you, 3 Samantha Carlisle Executive Secretary III A0GC:C. (907) 793-1223 From: Robert Warthen[mailto:rwarthen@nordagenergy.com] Sent: Friday, January 20, 2017 1:27 PM To: Carlisle, Samantha J (DOA) <samantha.carlisle@alaska.gov> Subject: Meeting. Hi Samantha: Commissioner Foerster suggested I have a meeting with Mike Quick and Guy Schwartz. Can you arrange that for sometime next week please? Thanks, Bob. Robert Warthen Senior Advisor NordAq Energy, Inc. 560 East 34th St. Suite 200 Anchorage, Alaska 99503 907.646.9315 main 907.375.1816 direct 907.646.9317 fax rwarthen(a-)-nordagenergy.com This message and any attachments are the property of NordAq Energy Inc. and are intended solely for the named recipients or entity to whom this message is addressed. If you have received this message in error, please inform the sender via e-mail and destroy the message. If you are not the intended recipient, you are not allowed to use, copy, or disclose the contents or attachments in whole or in part. 4 Carlisle, Samantha J (DOA) From: Carlisle, Samantha J (DOA) Sent: Tuesday, January 24, 2017 8:41 AM To: 'Robert Warthen' Subject: RE: Meeting. Bob, Staff is reviewing the Sundry's and have said that if they ,need to have a meeting to get more information that we will be in toLich next week to arrange that. Please let me know if you have any questions. Thank you, Samantha Carlisle l�xectztive Secretary lIf s1OG('(- (907) 793-2223 From: Robert Warthen[mailto:rwarthen@nordagenergy.com] Sent: Friday, January 20, 2017 1:27 PM To: Carlisle, Samantha J (DOA) <samantha.carlisle @alaska.gov> Subject: Meeting. Hi Samantha: Commissioner Foerster suggested I have a meeting with Mike Quick and Guy Schwartz. Can you arrange that for sometime next week please? Thanks, Bob. Robert Warthen Senior Advisor NordAq Energy, Inc. 560 East 34th St. Suite 200 Anchorage, Alaska 99503 907.646.9315 main 907.375.1816 direct 907.646.9317 fax rwarthen(a)-nordagenergy.com This message and any attachments are the property of NordAq Energy Inc. and are intended solely for the named recipients or entity to whom this message is addressed. If Carlisle, Samantha J (DOA) From: Robert Warthen <rwarthen@nordaqenergy.com> Sent: Monday, January 23, 2017 1:31 PM To: Carlisle, Samantha J (DOA) Subject: Meeting Hi Samantha: On the proposed meeting with Mike Quick and Guy Schwartz, my best time would be Thursday or Friday late morning and all afternoon. Thanks, Bob. Robert Warthen Senior Advisor NordAq Energy, Inc. 560 East 34th St. Suite 200 Anchorage, Alaska 99503 907.646.9315 main 907.375.1816 direct 907.646.9317 fax rwarthen(aD.nordagenergy.com This message and any attachments are the property of NordAq Energy Inc. and are intended solely for the named recipients or entity to whom this message is addressed. If you have received this message in error, please inform the sender via e-mail and destroy the message. If you are not the intended recipient, you are not allowed to use, copy, or disclose the contents or attachments in whole or in part. Carlisle, Samantha J (DOA) From: Robert Warthen <rwarthen@nordaqenergy.com> Sent: Friday, January 20, 2017 1:27 PM To: Carlisle, Samantha J (DOA) Subject: Meeting. Hi Samantha: Commissioner Foerster suggested I have a meeting with Mike Quick and Guy Schwartz. Can you arrange that for sometime next week please? Thanks, Bob. Robert Warthen Senior Advisor NordAq Energy, Inc. 560 East 34th St. Suite 200 Anchorage, Alaska 99503 907.646.9315 main 907.375.1816 direct 907.646.9317 fax rwarthen6c nordagenergy.com This message and any attachments are the property of NordAq Energy Inc. and are intended solely for the named recipients or entity to whom this message is addressed. If you have received this message in error, please inform the sender via e-mail and destroy the message. If you are not the intended recipient, you are not allowed to use, copy, or disclose the contents or attachments in whole or in part. Colombie, Jody J (DOA) From: Foerster, Catherine P (DOA) Sent: Friday, January 20, 2017 1:18 PM To: French, Hollis (DOA); Seamount, Dan T (DOA); Ballantine, Tab A (LAW); Colombie, Jody J (DOA) Subject: FW: Abandonments FYI. Jody, please put this into the appropriate files. Thanks. From: Foerster, Catherine P (DOA) Sent: Friday, January 20, 2017 1:17 PM To:'Robert Warthen' <rwarthen@nordaqenergy.com> Cc: Carlisle, Samantha J (DOA) <samantha.carlisle @alaska.gov> Subject: RE: Abandonments Mr. Warthen, A commissioner may not have a private meeting with a party concerning a subject under adjudication. If you would like to meet with any of our staff to discuss the proposed abandonments, please contact my secretary (copied on this email), and she can assist you in making the necessary arrangements. Thank you. Cathy Foerster From: Robert Warthen [mailto:rwarthen@nordagenergy.comj Sent: Friday, January 20, 2017 10:23 AM To: Foerster, Catherine P (DOA) <cathy.foerster@alaska.gov> Subject: Abandonments Dear Commissioner Foerster: On behalf of NordAq Energy, I apologize for giving the Commission the impression that NordAq is ignoring its responsibilities in Abandonment Orders for the two wells it has drilled. There have been circumstances previous, and up to December 30th, 2016, that caused NordAq to delay abandonments until third party decisions were made. NordAq has no intention to be remiss in its duties to abandon Tiger Eye Central #1 and Shadura #1. This morning, an Abandonment Sundry for Shadura #1 was delivered to the Commission for review and approval. The Sundry for Tiger Eye Central #1 will be delivered early next week. I would like to have an informal meeting with you to discuss and review these proposed abandonments. Is it possible to meet with you next week at your convenience? Thanks, Sincerely, Bob. Robert Warthen Senior Advisor NordAq Energy, Inc. 560 East 34th St. Suite 200 Anchorage, Alaska 99503 907.646.9315 main 907.375.1816 direct 907.646.9317 fax rwarthen(a)-nordagenergy.com This message and any attachments are the property of NordAq Energy Inc. and are intended solely for the named recipients or entity to whom this message is addressed. If you have received this message in error, please inform the sender via e-mail and destroy the message. If you are not the intended recipient, you are not allowed to use, copy, or disclose the contents or attachments in whole or in part. i �l DEPARTMENT OF NATURAL RESOURCES DIVISION OF OIL AND GAS April 28, 2004 Commissioner John Norman Alaska Oil and Gas Conservation Commission 333 W. 7th Ave., Ste. 100 Anchorage, Alaska 99501 Frank Murkowski, GOVERNOR 550 WEST 7TM AVE, SUITE 800 ANCHORAGE, ALASKA 99501 PHONE: (907) 269-8778 FAX: (907) 269-8943 t, : Lo(c i '�5-- c-�07 RE: GRI (Houston #1, #2, #3, #4 and #22) Site Abandonment and Restoration Dear Chairman Norman: I understand that the Alaska Oil and Gas Conservation Commission is issuing a Request for Proposals under which a contractor will plug and abandon and perform location clearance for five coalbed methane wells in the vicinity of Houston, Alaska. As you know these wells - Houston Nos. 1, 2, 3, 4, and 22 - were drilled by GRI, Inc., on oil and gas leases issued by the Department of Natural Resources, through the Division of Oil and Gas. The lessee failed to perform the required well abandonment and location clearance operations in accordance with the Commission's regulations, and the Commission is now proposing to have these operations performed by a contractor using funds obtained by the AOGCC from GRI's surety bond with the Commission. To the extent that the Commission or any contractor may seek or require the authorization or consent of the Department of Natural Resources as owner of the oil and gas estate to enter the affected lands and perform well plugging and abandonment and location clearing operations, such authorization and consent are hereby given. As a courtesy to the owners of the surface estate, we request that your contractor contact the surface owner(s) in advance of the work being performed and share your work plan with them. Sincerely, —27 Mark D. Myers Director "Develop, Conserve, and Enhance 1Vatural Resources fur Present and Future Alaskans. " THE STATE 'Department of N-alvrad 01AL1 1SK-A f31VfSit hi OF O!! `\Ni) GAS GOVERNOR BILI. WALKER January 20, 2016 Robert Warthen, President NordAq Energy, Inc. 3000 A Street, Suite 200 Anchorage, AK 99503 RE: Statewide Bond Release Request for $500,000 Certificate of Deposit with Wells Fargo Bank of Anchorage, Account Number 9422389560 Dear Mr. Warthen: After considering your emails dated 12-28-15 and 1-4-16, the Division provides the following response. Several different provisions require the Unit Operator to furnish and maintain a statewide bond for operations (11 AAC 83.390) and to rehabilitate the site to the satisfaction of the Commissioner including abandoning a well (Oil and Gas Lease 391104, Term 21. Rights Upon Termination). Additionally, the existing Unit Plan of Operations (Plan) LOCI 12-003 is subject to the statewide bond requirement. Under the Unit Agreement, Article 17 the "agreement is subject to all applicable state and federal statutes and regulations in effect..." Such language is inclusive of bonding requirements under 11 AAC 83.390, 11 AAC 83.160, and 11 AAC 82.600. Although NordAq and Division staff have discussed NordAq's interest in terminating the Unit, the Unit is currently in effect through September 30, 2017. The formal procedure to forfeit or to voluntarily terminate the unit can be initiated by sending a letter to the Director with your request. The Director would then respond in writing to NordAq addressing the voluntary termination. Please contact the unit manager, Hak Dickenson, for assistance with the process. It should be noted that such a letter requesting to abandon the unit does not absolve NordAq of its obligation to complete the operations, including plugging and abandoning the well. Consequently, the Division maintains its original position in the letter dated December 23, 2015 and denies the release of Nordaq's $500,000 statewide bond until the Tiger Eye Central #1 Well within the Tiger Eye Unit is satisfactorily plugged and abandoned and all other unit operations are completed. If you have any questions, please contact Tom Barrett at 907 269-8769 or Kim Kruse at 907 365-7754. An eligible person affected by this decision may appeal it, in accordance with 11 AAC 02. Any appeal must be received within 20 calendar days after the date of issuance of this decision, as NordAq Energy, Inc. Page 2 January 20, 2016 Statewide Bond Release Request defined in 11 AAC 02.040 (c) and (d), and may be mailed or delivered to the Commissioner, Department of Natural Resources, 550 W. 7th Avenue, Suite 1400, Anchorage, Alaska 99501; faxed to 1-907-269-8918; or sent by electronic mail to dnr.appeals@alaska.gov. This decision takes effect immediately. An eligible person must first appeal this decision in accordance with 11 AAC 02 before appealing this decision to Superior Court. A copy of 11 AAC 02 may be obtained from any regional information office of the Department of Natural Resources. Sin Corn A. Feige Division Director cc: Hak Dickenson, Unit Manager Tom Barrett, Natural Resource Officer Kim Kruse, Permitting Manager Steve Davies, AOGCC Notice of Public Hearing STATE OF ALASKA Alaska Oil and Gas Conservation Commission Re: Docket No. OTH-16-032 Failure to Plug and Abandon Tiger Eye Central -1 (PTD 212-102) Failure to Respond to Notice of Proposed Enforcement Action Pursuant to 20 AAC 25.540, the Alaska Oil and Gas Conservation Commission (AOGCC) has scheduled a public hearing for April 4, 2017 at 9:00 a.m. at the offices of the AOGCC at 333 West 7th Avenue, Anchorage, Alaska 99501. The subject of the hearing is AOGCC's proposed enforcement action against NordAq Energy Inc. (NordAq) for failure to permanently abandon the Tiger Eye Central -1 exploratory well before expiration of rights in State of Alaska Oil and Gas Lease ADL 391104, 20 AAC 25.105(a). The surface location for the well lies on private land; and the bottom hole location for the well lies within ADL 391104, Section 24, Township 8 North, Range 15 West, Seward Meridian. Written comments regarding NordAq's failure to plug and abandon the Tiger Eye Central -1 well may be submitted to the AOGCC at 333 West 7th Avenue, Anchorage, Alaska 99501. Comments must be received no later than the conclusion of the April 4, 2017 hearing. If, because of a disability, special accommodations may be needed to comment or attend the hearing, contact the AOGCC's Special Assistant, Jody Colombie, at 793-1221, no later than April 2, 2017. (/ Cathy. . Foerster Chair, Commissioner E3 Hostage -D Total Postage and Fees Robert Warthen O $ Senior Advisor in Sent To NordAq Energy, Inc. OStreet and Apt No.; or Po aoz nio. 560 E. 34th Ave., Ste. 200 11 Ciiy,-State; ziP+d® """-"--"---------------- Anchorage, AK 99503 ■ Complete items 1, 2, and 3. A. °Si 3 e ■ Print your name and address on the reverse fi ❑ Agent so that we can return the card to you. ❑ Addre ■ Attach this card to the back of the mailpiece, B. ece/ive b (Prtin�teyd�N'ame�), / C D to of I or on the front if space permits. C -�` ' n�✓ Z� f 1. tfW` s different from item 1 ElYes Robert Warthen E very address below: ❑ No Senior Advisor 2 6 2017 NordAq Energy, Inc. JA 14 560 E. 34th Ave., Ste. 200 � ��� Anchorage, AK 99503 II I IIIII III III II II I II I III I I II I IIII I (' I Service Type ❑ Priority Mail Express® El ❑ Adult Signature ❑Registered MaiIT"" ❑ dult Signature Restricted Delivery ❑ Registered Mail Restricted Certified Mair Delivery 9590 9401 0057 5071 0132 77, ❑ Certified Mail Restricted Delivery ❑ Return Receipt for ❑ Collect on Delivery Merchandise 2 Article Number (Transfer from service label) ❑ Collect on Delivery Restricted Delivery ❑ Signature Confirmation— s —gyred Mail ❑ Signature Confirmation �. ?015 0640 0003 5185 5130 red Mail Restricted Delivery Restricted Delivery r _ r $500)x'' PS Form 3811, April 2015 PSN 7530-02-000-9053 Domestic Return Receipt Postal CERTIFIED ° RECOT E3 Domestic M a Ln Ln° �O Certified Mail Fee Ln Extra Services & Fees (check box, add fee as appropriate) ❑ Return Receipt (hardcopy) $ M [)Return Recelpt (electronic) $ Postmark ❑ Certified Mail Restricted Dellvery $ Here O F] Adult Signature Required $ ❑ Adult Signature Restricted Delivery $ E3 Hostage -D Total Postage and Fees Robert Warthen O $ Senior Advisor in Sent To NordAq Energy, Inc. OStreet and Apt No.; or Po aoz nio. 560 E. 34th Ave., Ste. 200 11 Ciiy,-State; ziP+d® """-"--"---------------- Anchorage, AK 99503 ■ Complete items 1, 2, and 3. A. °Si 3 e ■ Print your name and address on the reverse fi ❑ Agent so that we can return the card to you. ❑ Addre ■ Attach this card to the back of the mailpiece, B. ece/ive b (Prtin�teyd�N'ame�), / C D to of I or on the front if space permits. C -�` ' n�✓ Z� f 1. tfW` s different from item 1 ElYes Robert Warthen E very address below: ❑ No Senior Advisor 2 6 2017 NordAq Energy, Inc. JA 14 560 E. 34th Ave., Ste. 200 � ��� Anchorage, AK 99503 II I IIIII III III II II I II I III I I II I IIII I (' I Service Type ❑ Priority Mail Express® El ❑ Adult Signature ❑Registered MaiIT"" ❑ dult Signature Restricted Delivery ❑ Registered Mail Restricted Certified Mair Delivery 9590 9401 0057 5071 0132 77, ❑ Certified Mail Restricted Delivery ❑ Return Receipt for ❑ Collect on Delivery Merchandise 2 Article Number (Transfer from service label) ❑ Collect on Delivery Restricted Delivery ❑ Signature Confirmation— s —gyred Mail ❑ Signature Confirmation �. ?015 0640 0003 5185 5130 red Mail Restricted Delivery Restricted Delivery r _ r $500)x'' PS Form 3811, April 2015 PSN 7530-02-000-9053 Domestic Return Receipt Notice of Public Hearing STATE OF ALASKA Alaska Oil and Gas Conservation Commission Re: Docket No. OTH-16-032 Failure to Plug and Abandon Tiger Eye Central -1 (PTD 212-102) Failure to Respond to Notice of Proposed Enforcement Action Pursuant to 20 AAC 25.540, the Alaska Oil and Gas Conservation Commission (AOGCC) has scheduled a public hearing for April 4, 2017 at 9:00 a.m. at the offices of the AOGCC at 333 West 7t" Avenue, Anchorage, Alaska 99501. The subject of the hearing is AOGCC's proposed enforcement action against NordAq Energy Inc. (NordAq) for failure to permanently abandon the Tiger Eye Central -1 exploratory well before expiration of rights in State of Alaska Oil and Gas Lease ADL 391104, 20 AAC 25.105(a). The surface location for the well lies on private land; and the bottom hole location for the well lies within ADL 391104, Section 24, Township 8 North, Range 15 West, Seward Meridian. Written comments regarding NordAq's failure to plug and abandon the Tiger Eye Central -1 well may be submitted to the AOGCC at 333 West 7h Avenue, Anchorage, Alaska 99501. Comments must be received no later than the conclusion of the April 4, 2017 hearing. If, because of a disability, special accommodations may be needed to comment or attend the hearing, contact the AOGCC's Special Assistant, Jody Colombie, at 793-1221, no later than April 2, 2017. Hsignature on fileH Cathy P. Foerster Chair, Commissioner STATE OF ALASKA ADVERTISING ORDER NOTICE TO PUBLISHER SUBMIT INVOICE SHOWING ADVERTISING ORDER NO., CERTIFIED AFFIDAVIT OF PUBLICATION WITH ATTACHED COPY OFADVERTISMENT. ADVERTISING OMERNUMBER O AO-17-018 FROM: Alaska Oil and Gas Conservation Commission AGENCY CONTACT: Jody Colombie/Samantha Carlisle DATE OF A. 0. 01/13/17 AGENCY PHONE: (907)279-1433 333 West 7th Avenue Anchorage, Alaska 99501 DATES ADVERTISEMENT REQUIRED: COMPANY CONTACT NAME: PHONE NUMBER: ASAP FAX NUMBER: (907)276-7542 TO PUBLISHER: Alaska Dispatch News SPECIAL INSTRUCTIONS: PO Box 149001 Anchorage, Alaska 99514 TYPE OFADVE'R"11SEMENT; LEGAL DISPLAY CLASSIFIED OTHER (S pecify be low) DESCRIPTION PRICE 0th-16-032 Initials of who prepared AO: Alaska Non -Taxable 92-600185 ::s .uIi lirnvoki.iiti*i.k*diD'-4'Rh51NG:: Department of Administration ORDER:NO.;CERT.IFIED AFFIDAYIT O.F.::: Division of AOGCC P.UBtiiCAT.ION WiTH:ATTACHEDGOP.Y.OF:: 333 West 7th AvenueTotal .................................... A............. ..... ::: Anchorage, Alaska 99501J Pae 1 of 1 of All Pa es S REF Type Number Amount Date Comments I PvN ADN89311 2 Ao AO-17-018 3 4 FIN AMOUNT SY Appr Unit PGM LGR Object FY DIST LIQ I 17 021147717 3046 17 2 3 4 5 � Pur hasin u e Title: Purchasing Authority's Signature Telephone Number 1. A.O. # e ving gency name m pear on all invoices and documents relating to this purchase. 2. The s t is registered for tax free transactions under Chapter 32, IRS code. Registration number 92-73-0006 K. Items are for the exclusive use of the state and not for resale. DTSTRII3UT>ON::::::::::::::::::::::::::::::::::::::::::::::::::::::::: bivision FiscaVOhf nal Ab ::::::::: ..............................I>.............. Cb iesi: Pulilislier. faxed :T3IA4s h Fi 6 Tteceivfii ::::::::::::::::-...........:::::::::::::::: : ...4...............r.........g............................................ Form: 02-901 Revised: 1/13/2017 270227 0001398786 $174.32 STATE OF ALASKA RECEIVE JAIL 2 0 2017 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 January 14, 2017 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 17th day of Janua 2017 Notary PVlic n and for The State of Alaska. Third Division Anchorage, Alaska MY COMMISSION EXPIRES Notice of Public Hearing STATE OF ALASKA Alaska Oil and Gas Conservation Commission Re: Docket No. OTH-16-032 Failure to Plug and Abandon Tiger Eye Central -1 (PTD 212-102) Failure to Respond to Notice of Proposed Enforcement Action Pursuantto 20 AAC 25.540, the Alaska Oil and Gas Conservation Commission (AOGCC) has scheduled a public hearing for April 4, 2017 at 9:00 a.m. at the offices of the AO CC at 333 West 7th Avenue, Anchorage, Alaska 99501. The subject of the hearing is AOGCC's proposed enforcement action against NordAq Energy lnc. (NordAq) for failure to permanentl abandon the Tiger Eye Central -1 exploratory well before expiration oly rights in State of Alaska Oil and Gas Lease ADL 391104, 20 AAC 25105(a). The surface location for the well lies on private land; and the Town ship 8 North, Range 15 We tl Seward Meridian. an391104, Section 24, Written comments regarding NordAq's failure to plu and abandon the Tiger Eye Central -1 well may be submitted to the %GCC at 333 West stet han thAnchorage, conclu gen of the Ap5i�4, 2017 hearinmust be received no If o oattend the heaiinspecial ontactntheAOGCC's may needed to , Jody Colombie, at 793-1221, no later than April 2, 2017. //signature on file// Cathy P. Foerster Chair, Commissioner Published: January 14, 2017 Notary Public BRITNEY L. THOMPSON State of Alaska My Commission Expires Feb 23, 12019 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 Singh, Angela K (DOA) From: Colombie, Jody 1 (DOA) Sent: Friday, January 13, 2017 1:12 PM To: DOA AOGCC Prudhoe Bay, Bender, Makana K (DOA); Bettis, Patricia K (DOA); Brooks, Phoebe L (DOA); Carlisle, Samantha J (DOA); Colombie, Jody 1 (DOA); Davies, Stephen F (DOA); Eaton, Loraine E (DOA); Foerster, Catherine P (DOA); French, Hollis (DOA); Frystacky, Michal (DOA); Guhl, Meredith D (DOA); Kair, Michael N (DOA); Link, Liz M (DOA); Loepp, Victoria T (DOA); Mumm, Joseph (DOA sponsored); Paladijczuk, Tracie L (DOA); Pasqual, Maria (DOA); Quick, Michael J (DOA); Regg, James B (DOA); Roby, David S (DOA); Schwartz, Guy L (DOA); Seamount, Dan T (DOA); Singh, Angela K (DOA); Wallace, Chris D (DOA); AK, GWO Projects Well Integrity; AKDCWellIntegrityCoordinator, Alan Bailey; Alex Demarban; Alexander Bridge; Allen Huckabay; Andrew Vandedack; Ann Danielson; Anna Raff; Barbara F Fullmer; bbritch; bbohrer@ap.org; Ben Boettger; Bill Bredar; Bob Shavelson; 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 Johnston; David McCaleb; David McCraine; David Tetta; ddonkel@cfl.rr.com; DNROG Units (DNR sponsored); 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; Hyun, James J (DNR); Jacki Rose; Jdarlington Oarlington@gmail.com); Jeanne McPherren; Jerry Hodgden; Jim Watt; Jim White; Joe Lastufka; Radio Kenai; Burdick, John D (DNR); Easton, John R (DNR); Larsen, John M (DOR); John Stuart; Jon Goltz; Chmielowski, Josef (DNR); Juanita Lovett; Judy Stanek; Julie Little; Kari Moriarty; Kasper Kowalewski; Kazeem Adegbola; Keith Torrance; Keith Wiles; Kelly Sperback; Frank, Kevin J (DNR); Kruse, Rebecca D (DNR); Gregersen, Laura S (DNR); Leslie Smith; Lori Nelson; Louisiana Cutler; Luke Keller, Marc Kovak; Dalton, Mark (DOT sponsored); Mark Hanley (mark.hanley@anadarko.com); Mark Landt; Mark Wedman; Mealear Tauch; Michael Bill; Michael Calkins; Michael Moora; MJ Loveland; mkm7200; Munisteri, Islin W M (DNR); knelson@petroleumnews.com; Nichole Saunders; Nikki Martin; NSK Problem Well Supv; Patty Alfaro; Paul Craig; Decker, Paul L (DNR); Paul Mazzolini; Pike, Kevin W (DNR); Randall Kanady; Rena Delbridge; 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; Moothart, Steve R (DNR); Steve Quinn; Suzanne Gibson; sheffield@aoga.org; Ted Kramer; Davidson, Temple (DNR); 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; Bruce Williams; Bruno, Jeff J (DNR); Casey Sullivan; Catie Quinn; Don Shaw; Eric Lidji; Garrett Haag; Smith, Graham O (DNR); Dickenson, Hak K (DNR); Heusser, Heather A (DNR); Fair, Holly S (DNR); 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; Steele, Marie C (DNR); Matt Armstrong; Franger, James M (DNR); Morgan, Kirk A (DNR); Umekwe, Maduabuchi P (DNR); Pat Galvin; Pete Dickinson; Peter Contreras; Richard Garrard; Richmond, Diane M; Robert Province; Ryan Daniel; Sandra Lemke; Pollard, Susan R (LAW); Talib Syed; Tina Grovier (tmgrovier@stoel.com); Tostevin, Breck C (LAW); Wayne Wooster, William Van Dyke Subject: NordAq's Public Hearing Notices Docket No.'s OTH-16-031 and OTH 16-032 Attachments: Public Hearing Notice Tiger Eye-i.pdf, Public Hearing Notice Shadura-1.pdf Re: Docket No. OTH-16-031 Failure to Plug and Abandon Shadura-1 (PTD 211-014) Failure to Respond to Notice of Proposed Enforcement Action Re: Docket No. OTH-16-032 Failure to Plug and Abandon Tiger Eye Central -1 (PTD 212-102) Failure to Respond to Notice of Proposed Enforcement Action Jody J. CoCombie AOCGCC SpeciaCAssistant Alaska OiCandGas Conservation Commission 333 West 7" .Avenue Anchorage, ACaska 99501 Office: (907) 793-1221 Fax: (907) 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. THE STATE Department of NatujrM Resourr-es °fALASKA DIVISION OF 0[L AND GAS 550 W. 7" Ave, Suite 1100 Anchorage, AK 99501 Main: 907.269.8800 G 0 V 1 it N O R 1111.1, NV A I.K F. R Fax: 907.269.3484 December 23, 2015 Robert Warthen 3000 A Street, Suite 200 Anchorage, AK 99503 RE: Statewide Bond Release Request Dear Mr. Warthen: On October 14, 2015 Todd Kasteler with Cruz Construction, Inc., on behalf of Nordaq Energy. Inc. (Nordaq), requested that the Division of Oil and Gas (Division) release Nordaq's Statewide Oil and Gas bond (bond). This correspondence serves as the Division's response. Division records indicate that four Plan of Operations (Plan) authorizations are subject to the bond: LOCI 11-012; LOCI 11-013; LOCI 12-003; and LONS 13-006. Division records indicate that requirements associated with LOCI 11-012, LOCI 11-013, and LONS 13-006 have been met. Division records indicate additional regulatory action(s) are required directly related to Plan authorization LOCI 12-003. The Tiger Eye Central #1 well, within the Tiger Eye Unit, was approved by LOCI 12-003 and is currently in a suspended status according to Alaska Oil and Gas Conservation Commission (AOGCC) records. The AOGCC requires that wells be plugged and abandoned under 20 AAC 25.105 and an onshore location clearance be conducted under 20 AAC 25.170. These remaining unit operations to plug and abandon the Tiger Eye Central #1 well within the Tiger Eye Unit require that a unit bond to be in place until operations are completed. Consequently, the Division denies the release of Nordaq's bond until the Tiger Eye Central #I Well within the Tiger Eye Unit is satisfactorily plugged and abandoned and all other unit operations are completed. If you have any questions, please contact Tom Barrett at 907 269-8769. Sincerely, Kim Kruse Permitting Manager cc: Hak Dickenson, Unit Manager z THE STATE GOVERNOR BILL WALKER Robert Warthen Senior Advisor NordAq Energy Inc. 560 E. 34th Ave., Ste. 200 Anchorage, AK 99503 December 2, 2016 CERTIFIED MAIL RETURN RECEIPT REQUESTED 7015 0640 0003 5185 5512 Re: Docket Number: OTH-16-032 Alaska Oil and Gas Conservation Commission 333 West Seventh Avenue Anchorage, Alaska 99501-3572 Main: 907.279.1433 Fax: 907.276.7542 www.aogcc.alaska.gov Notice of Proposed Enforcement Action Failure to Plug and Abandon Tiger Eye Central -1 (PTD 212-102) Before Expiration of Owner's Rights in Oil and Gas Lease ADL 391104 Dear Mr. Warthen: The Alaska Oil and Gas Conservation Commission (AOGCC) herby notifies NordAq Energy Inc. (NordAq) of a proposed enforcement action. Nature of the Apparent Violation or Noncompliance (20 AAC 25.535(b)(1)). NordAq violated 20 AAC 25.105(a) by its failure to permanently abandon the Tiger Eye Central - 1 exploratory well (Tiger Eye 1) before expiration of NordAq's rights in that property. Basis for Finding the Violation or Noncompliance (20 AAC 25.535(b)(2)). On October 14, 2016, the Department of Natural Resources (DNR) advised AOGCC that it had received on January 27, 2016, a surrender of two leases associated with the Tiger Eye Unit (ADL 391104 and ADL 391103). DNR approved the termination of the Tiger Eye Unit effective October 12, 2016. NordAq's rights in the two leases expired that same date. The AOGCC issued Permit to Drill No. 212-102 for the Tiger Eye 1 exploratory well to NordAI on September 4, 2012. The Tiger Eye 1 was drilled in 2012 and subsequently suspended. The surface location for the well lies on private land; and the bottom hole location for the well -lies within DNR lease ADL 391104. Tiger Eye 1 has not been properly plugged and abandoned. NordAq has violated 20 AAC 25.105(a). Proposed Action (20 AAC 25.535(b)(3). Within ninety (90) days of receipt of this letter, NordAq shall either: Submit a Sundry Application to the AOGCC for the plugging and abandonment of the Tiger Eye 1 and properly plug and abandon Tiger Eye 1 in accordance with AOGCC regulations; or Submit a check in the amount of $1,300,000 which AOGCC estimates to be the cost to properly plug and abandon Tiger Eye 1. After consideration of the criteria set forth in AS 31.05.150(g), for these violations, the AOGCC intends to impose civil penalties on NordAq as follows: 1. $100,000 for the initial violation: failure to properly permanently abandon Tiger Eye 1 before expiration of owner's rights in oil and gas lease ADL 391104. 2. $50,000 for violating the requirement to plug and abandon and clear the well site to the satisfaction of the AOGCC as per 20 AAC 25.112 and 20 AAC 25.170 (50 days at $1,000 per day.) The total proposed civil penalty is $150,000. Rights and Liabilities (20 AAC 25.535(b)(4)). Within 15 days after receipt of this notification — unless the AOGCC, in its discretion, grants an extension for good cause shown — NordAq may file with the AOGCC a written response that concurs in whole or in part with the proposed action described herein, requests informal review, or requests a hearing under 20 AAC 25.540. If a timely response is not filed, the proposed action will be deemed accepted by default. If informal review is requested, the AOGCC will provide NordAq an opportunity to submit documentary material and make a written or oral statement. If NordAq disagrees with the AOGCC's proposed decision or order after that review, it may file a written request for a hearing within 10 days after the proposed decision or order is issued. If such a request is not filed within that 10 -day period, the proposed decision or order will become final on the 11th day after it was issued. If such a request is timely filed, the AOGCC will hold its decision in abeyance and schedule a hearing. If NordAq does not concur in the proposed action described herein, and the AOGCC finds that NordAq has violated a provision of AS 31.05, 20 AAC 25, or an AOGCC order, permit or other approval, then the AOGCC may take any action authorized by the applicable law including ordering one or more of the following: (i) corrective action or remedial work; (ii) suspension or revocation of a permit or other approval; (iii) payment under the bond required by 20 AAC 25.025; and (iv) imposition of penalties under AS 31.05.150. In taking action after an informal review or hearing, the AOGCC is not limited to ordering the proposed action described herein, as long as NordAq received reasonable notice and opportunity to be heard with respect to the AOGCC's action. Any action described hereto or taken after an informal review or hearing does not limit the action the AOGCC may take under AS 31.05.160. Sincerely, �4 4L� Cathy . Foerster Chair, Commissioner cc: Chantal Walsh, Director Department of Natural Resources, Division of Oil and Gas r'LJ Domestic Mail Only a Lrl For delivery information, visit our website at www.usps.coml. Ln Lr7 co Certified Mail Fee r-3 $ El Priority Mail Express® Ln Extra Services & Fees (check box, add f" as appropriate) M [I Return Receipt (hardcopy) $ E3 [] Return Receipt (electronic) $ Postmark E3 F-1 Certified Mail Restricted DeliveryDelivery$ Here C3 E] Adult Signature Required $ []Adult Signature Restricted Delivery $ El Adult Signature M Postage -j- $ —0 Total Postage and Fees C3 Robert War -then Ln Sent To Senior Advisor r-9 ----------- NordAq Energy Inc. C3 oWAYLF& No. 0 Certified Mail® El Certified Mail Restricted Delivery Delivery ©'Return Receipt for 560 E. 34th Ave., Ste. 200 Merchandise P Article Number (Transfer from service label) Anchorage, AK 99503 • Complete items 1, 2, and 3. • Print your name and address on the reverse so that we can return the card to you. • Attach this card to the back of the mailpiece, or on the front if space permits. 1. Ar4;-i- AAA --A - A. X 0 Agent Cl Addressee �B Received by (Printed ;;;)` C. Datelof,Deli'very rL 17- D. Is delivery address different from item 1? IT Yes' If YES, enter delivery address below: F-1 No Robert Warthen Senior Advisor NordAq Energy Inc. 560 E. 34th Ave., Ste. 200 Anchorage, AK 99503 3. Service Type El Priority Mail Express® El Adult Signature U Registered MailT. El Adult Signature Restricted Delivery 11 Registered Mail Restricted 9590 9401 0057 5071 0133 83 0 Certified Mail® El Certified Mail Restricted Delivery Delivery ©'Return Receipt for El Collect on Delivery Merchandise P Article Number (Transfer from service label) 0 Collect on Delivery Restricted Delivery 0 Signature Confirmation - 7015 0640 0003 5185 5512 I Insured Mail ed Mail Restricted Delivery El Signature Confirmation Restricted Delivery PS Form 3811, April 2015 PSN 7530-02-000-9053 Domestic Return Receipt THE S`l'A"1'.l ,,ALASKA December 23, 2015 Robert Warthen 3000 A Street, Suite 200 Anchorage, AK 99503 RE: Statewide Bond Release Request Dear Mr. Warthen: Dopa linen, of Natural Resources DIVISION OF OIL, AND GAS 550 W. T" Ave, Suite 1 100 Anchorage, AK 99501 Main: 907.269.8800 Fax: 907269.3484 On October 14, 2015 Todd Kasteler with Cruz Construction, Inc., on behalf of Nordaq Energy. Inc. (Nordaq), requested that the Division of Oil and Gas (Division) release Nordaq's Statewide Oil and Gas bond (bond). This correspondence serves as the Division's response. Division records indicate that four Plan of Operations (Plan) authorizations are subject to the bond: LOCI 11-012; LOCI 11-013; LOCI 12-003; and LONS 13-006. Division records indicate that requirements associated with LOCI 11-012, LOCI 11-013, and LONS 13-006 have been met. Division records indicate additional regulatory action(s) are required directly related to Plan authorization LOCI 12-003. The Tiger Eye Central #1 well, within the Tiger Eye Unit, was approved by LOCI 12-003 and is currently in a suspended status according to Alaska Oil and Gas Conservation Commission (AOGCC) records. The AOGCC requires that wells be plugged and abandoned under 20 AAC 25.105 and an onshore location clearance be conducted under 20 AAC 25.170. These remaining unit operations to plug and abandon the Tiger Eye Central #1 well within the Tiger Eye Unit require that a unit bond to be in place until operations are completed. Consequently, the Division denies the release of Nordaq's bond until the Tiger Eye Central #1 Well within the Tiger Eye Unit is satisfactorily plugged and abandoned and all other unit operations are completed. If you have any questions, please contact Tom Barrett at 907 269-8769. Sincerely, Kim Kruse Permitting Manager cc: Hak Dickenson, Unit Manager THE STATE LASKA GOVERNOR BILL WALKER January 20, 2016 Robert Warthen, President NordAq Energy, Inc. 3000 A Street, Suite 200 Anchorage, AK 99503 3�C'p,11'it11ent g�8 '.'�e2a k `,� kaa RE: Statewide Bond Release Request for $500,000 Certificate of Deposit with Wells Fargo Bank of Anchorage, Account Number 9422389560 Dear Mr. Warthen: After considering your emails dated 12-28-15 and 1-4-16, the Division provides the following response. Several different provisions require the Unit Operator to furnish and maintain a statewide bond for operations (11 AAC 83.390) and to rehabilitate the site to the satisfaction of the Commissioner including abandoning a well (Oil and Gas Lease 391104, Term 21. Rights Upon Termination). Additionally, the existing Unit Plan of Operations (Plan) LOCI 12-003 is subject to the statewide bond requirement. Under the Unit Agreement, Article 17 the "agreement is subject to all applicable state and federal statutes and regulations in effect..." Such language is inclusive of bonding requirements under I 1 AAC 83.390, 11 AAC 83.160, and 11 AAC 82.600. Although NordAq and Division staff have discussed NordAq's interest in terminating the Unit, the Unit is currently in effect through September 30, 2017. The formal procedure to forfeit or to voluntarily terminate the unit can be initiated by sending a letter to the Director with your request. The Director would then respond in writing to NordAq addressing the voluntary termination. Please contact the unit manager, Hak Dickenson, for assistance with the process. It should be noted that such a letter requesting to abandon the unit does not absolve NordAq of its obligation to complete the operations, including plugging and abandoning the well. Consequently, the Division maintains its original position in the letter dated December 23, 2015 and denies the release of Nordaq's $500,000 statewide bond until the Tiger Eye Central #1 Well within the Tiger Eye Unit is satisfactorily plugged and abandoned and all other unit operations are completed. If you have any questions, please contact Tom Barrett at 907 269-8769 or Kim Kruse at 907 365-7754. An eligible person affected by this decision may appeal it, in accordance with 11 AAC 02. Any appeal must be received within 20 calendar days after the date of issuance of this decision, as NordAq Energy, Inc. Page 2 January 20, 2016 Statewide Bond Release Request defined in 11 AAC 02.040 (c) and (d), and may be mailed or delivered to the Commissioner, Department of Natural Resources, 550 W. 7th Avenue, Suite 1400, Anchorage, Alaska 99501; faxed to 1-907-269-8918; or sent by electronic mail to dnr.appeals@alaska.gov. This decision takes effect immediately. An eligible person must first appeal this decision in accordance with 11 AAC 02 before appealing this decision to Superior Court. A copy of 11 AAC 02 may be obtained from any regional information office of the Department of Natural Resources. Sincerely Corri A. Feige Division Director cc: Hak Dickenson, Unit Manager Tom Barrett, Natural Resource Officer Kim Kruse, Permitting Manager Steve Davies, AOGCC Colombie, Jody J (DOA) From: AOGCC Reporting (DOA sponsored) Sent: Tuesday, January 17, 2017 8:55 AM To: Foerster, Catherine P (DOA); Colombie, Jody J (DOA) Subject: FW: Former Tiger Eye Unit leases surrendered (NORDAQ) From: Link, Liz M (DOA) Sent: Friday, October 14, 2016 2:45 PM To: McIntyre, Haley N (DNR) <haley. mcintyre@alaska.gov>; dogpermitting (DNR sponsored) <DOG.Permitting @alaska.gov>; Clifton, Sean C (DNR) <sean.clifton@alaska.gov>; Davidson, Temple (DNR) <temple.davidson@alaska.gov>; Decker, Paul L (DNR) <paul.decker@alaska.gov>; AOGCC Reporting (DOA sponsored) <aogcc.reporting@alaska.gov> Cc: Kruse, Kim M (DNR) <kim.kruse@alaska.gov>; Hurst, Rona D (DNR) <rona.hurst@alaska.gov>; Davies, Stephen F (DOA) <steve.davies@alaska.gov>; Bettis, Patricia K (DOA) <patricia.bettis@alaska.gov>; Guhl, Meredith D (DOA) <meredith.guhl@alaska.gov>; Roby, David S (DOA) <dave.roby@alaska.gov> Subject: RE: Former Tiger Eye Unit leases surrendered (NORDAQ) Hello Haley, There are two wells in the AOGCC database that were permitted within the leases in the inquiry. One well was cancelled (never drilled), and the other has a current class of Suspended. AOGCC staff will look into this well (TIGER EYE CENTRAL 1) and communicate with the operator to get the well to a compliant P&A status. Please let us know if you have any questions. Liz Link Statistical Technician Alaska Oil and Gas Conservation Commission (AOGCC) 907.793.1241 liz.link(&alaska. oo From: McIntyre, Haley N (DNR) Sent: Friday, October 14, 2016 2:25 PM To: dogpermitting (DNR sponsored) <DOG.Permitting@alaska.goy>; Clifton, Sean C (DNR) <sean.clifton@alaska.gov>; Davidson, Temple (DNR) <temple.davidson@alaska.gov>; Decker, Paul L (DNR) <paul.decker@alaska.gov>; Link, Liz M (DOA) <liz.link@alaska.gov>; AOGCC Reporting (DOA sponsored) <aogcc.reporting@alaska.gov> Cc: Kruse, Kim M (DNR) <kim.kruse@alaska.gov>; Hurst, Rona D (DNR) <rona.hurst@alaska.gov> Subject: Former Tiger Eye Unit leases surrendered Hello, On January 27, 2016, the Division received a voluntary termination letter for the Tiger Eye Unit, and surrender of the two leases associated with it. The Commissioner approved this termination October 12, 2016. Lessee: NordAq Energy Inc. ADLs: 391103 and 391104 Lease Effective Date: October 1, 2007 Primary Term: 5 years AOGCC: What is the status of any wells permitted/drilled on these leases? A map is attached as reference. Thank you, Haley Haley McIntyre Natural Resource Specialist III Asset Manager— Development and Production Team Department of Natural Resources Division of Oil & Gas Direct Phone: (907) 375-8247 CONFIDENTIALITY NOTICE: This e-mail message, including any attachments, contains information from the Department of Natural Resources (DNR), State of Alaska and is for the sole use of the intended recipient(s). It may contain confidential and/or privileged information. The unauthorized review, use or disclosure of such information may violate state or federal law. If you are an unintended recipient of this e-mail, please delete it, without first saving or forwarding it, and, so that the DNR is aware of the mistake in sending it to you, contact Haley McIntyre at 907-375-8247 or.haley.mcintyre@alaska.gov THE STATE "ALASKA (IM'I R''�`t pit 1:(i.i. x;VA1 i�11_ FR NordAq Energy Inc. Attn: Robert C. Warthen 3000 A Street, Suite 200 Anchorage, AK 99.503 SURRENDER OF LEASES October 17, 2016 ADLs 391103 & 391104 The Division of Oil and Gas (Division) issued the above -referenced oil and gas leases effective October 1, 2007. On September 30, 2012, these leases were committed to the Tiger Eye Unit. On January 27, 2016, NordAq Energy Inc. submitted a written surrender for the Tiger Eye Unit and the leases in their entirety. The Commissioner approved the voluntary termination of the Tiger Eye Unit on October 12, 2016. Lease provisions and 11 AAC 82.635(b) state a surrender takes effect on the date it is filed, subject to the continued obligation of the lessee and its surety to make payment of all accrued royalties and rentals and to place the surrendered land in condition satisfactory for abandonment. The surrender of these two leases was predicated on the Commissioner's approval of the unit termination. Therefore, the effective date of the surrender of the leases listed above is October 12, 2016. A person affected by this decision may appeal it, in accordance with 11 AAC 02. Any appeal must be received within 20 calendar days after the date of "issuance" of this decision, as defined in 11 AAC 02.040 (c) and (d), and may be mailed or delivered to Commissioner, Department of Natural Resources. 550 West 7th Avenue, Suite 1400, Anchorage, Alaska 99501; faxed to 1-907- 269-8918; or sent by electronic mail to dnr.appeals@alaska.gov. This decision takes effect immediately. If no appeal is filed by the appeal deadline, this decision becomes a final administrative order and decision of the department on the 31st day after issuance. An eligible person must first appeal this decision in accordance with 11 AAC 02 before appealing this decision to Superior Court. A copy of 1 1 AAC 02 may be obtained from any regional information office of the Department of Natural Resources. Sincerely, James B. Beckham Acting Director I A L 201 u - 048353 -- 0 S Recording District 301 ANCHORAGE K A 10/15/2015 09:25 AM Page 1 of 3 AIA.r mcomInR rowm az Cook Inhn Region, Inc. AM. Land 6 Ro"&,mes pepirbnen� 725 E Fmrneed Lane, Sate OW Aneh&W& AK MW RELEASE OF OIL AND GAS LEASE C-061677 Anchorage Recording District Original Recording Information: Title: Memorandum of Cook Inlet Region, Inc. Oil and Gas lease C-061677 Recording District: Anchorage Serial Number: 2012-056441-0 Recording Date: 10/01/2012 WHEREAS, Cook Inlet Region, Inc. (UM") as LESSOR, entered into an Oil and Gas Lease (the "Lease") with Nordaq Energy, Inc. (Nordaq) as LESSEE, effective and covering the subsurface rights in the lands described on EXHIBIT A hereto (the "Lease") and; WHEREAS, the Lease was terminated effective July 1, 2015 and it is the desire of CIRI and Nordaq that Nordaq acknowledge release of the Lease; THEREFORE, Nordaq hereby releases all rights in the Lease DATED this day of 2015 "J. INVUGl t VV Cil UIGEI Its: President, Nordaq Energy, Inc. Page 1 of 3 STATE OF ALASKA ) ) ss. THIRD JUDICIAL DISTRICT The foregoing instrument was acknowledged before me this 2 day of 0.4o6cv , 2015, by Robert Warthen, President, Nordaq Energy, LLC STATE OF ALASKA . Notary Public in and for the State of Alaska NOTARY PUBLIC My Commission Expires: Tanisha Gleason ` My commisslon Expires: June 1. 2018 Page 2 of 3 Page 2 of 3 2015— 048353-0 RELEASE OF OIL AND GAS LEASE C-061677 Exhibit A — LEASED AREA Legal Description Township 8 North, Range 14 West, Seward Meridian Section 18: All; Section 19: All; containing approximately 1,280 acres, more or less Page 3 of 3 �i1�8411�.�LI�Itl�l�lh�:ll��ll�l1�� Page 3 of 3 2015-048353-0
