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Home My WebLink About2020 Deep Creek Unit Hilcorp Alaska, LLC March 25, 2021 Jesse Chmielowski, Commissioner Alaska Oil & Gas Conservation Commission 333 W. 7th Avenue, Suite 100 Anchorage, Alaska 99501-3539 Post Office Box 244027 Anchorage, AK 99524-4027 3800 Centerpoint Drive Suite 100 Anchorage, AK 99503 Phone: 907/777-8300 Fax: 907/777-8580 dduffy@hilcorp.com RE: DEEP CREEK UNIT, HAPPY VALLEY FIELD, STATE OF ALASKA, 2020 ANNUAL RESERVOIR REVIEW Dear Commissioner Chmielowski: In accordance with Conservation Order No. 553, Hilcorp Alaska, LLC (“Hilcorp”), as Operator, hereby submits for your review the following Annual Reservoir Review for the Happy Valley Beluga/Tyonek Gas Pool in the Happy Valley Field. This is the 16th Annual Reservoir Review and corresponds to events during the 2020 calendar year. Note that the Happy Valley Field has been on production since November 2004 and the cumulative production as of 12/31/2020 is 37.4 BSCF with an average rate of 3,496 MSCFD in December 2020. Note, these numbers do include gas volumes produced by the well HVB-14 from the Undefined, Sterling formation. The cumulative production reported dropped very slightly as compared to the report submitted in 2019. The cause of this drop was the removal of HVB-14’s cumulative produced volume from the overall Happy Valley cumulative production calculation, as HVB-14 has only ever produced from the Undefined, Sterling formation. Sincerely, Anthony McConkey Reservoir Engineer Anthony McConkey (2061) Digitally signed by Anthony McConkey (2061) DN: cn=Anthony McConkey (2061), ou=Users Date: 2021.03.25 12:49:15 -08'00' Reservoir review items per CO553 rule 4 a) Summary and analysis of reservoir pressure by major formation Because all of the Happy Valley wells have commingled production (from numerous sands), it is difficult to obtain precise individual sand reservoir pressures. Estimates can be made by reviewing pressures in wells with only one major zone open. The most recent shut-in wellhead pressures of wells with a single primary producing zone were compared to previous surveys (to verify fluid level for correcting to datum pressure using a gas gradient of .03 psi/ft) are shown below. The resulting average reservoir pressure by major zone is shown below. Since no new static surveys were conducted in 2020, updates for the Lower Tyonek and Sterling sands are based upon the latest SITP value and assumed pressure gradient to datum. Note these data points may be inaccurate due to unknown fluid columns, but fall in line with the produced volumes. b) Workovers & surveys of the existing wells. a. No new drill wells were brought online in 2020. b. No workovers were conducted in 2020. c. There was a Pressure/Temperature gauge run in HVA-10 along with perf guns during the Beluga 50 perforation in December 2020 to monitor for cooling post-perf. A small amount of cooling appears to be present, suggesting a small amount of gas production from the Beluga 50 post-perf. The tool was only run across the Beluga 50 sand, the remainder of the production is assumed to be coming from Tyonek 91 (“T-91”), as it is the only other sand open in the well. Page 2 Date of Pressure Taken HVA-01 7,155 Lower Tyonek 1153 883 6/14/2020 HVA-08 4,964 Beluga 929 779 9/2/2020 HVB-13 3,798 Upper Tyonek 993 768 9/2/2020 HVB-14 1,689 Sterling 318 258 6/20/2020 HVB-15 2,812 Upper Beluga 883 778 9/2/2020 Lower Tyonek Datum Depth (TVDss) 2000 3500 5000 7500 9000 Initial Pressure (psig) 860 1505 2150 3225 3870 2020 Est. Pressure (psig) 318 883 929 768 1153 Top Perf Depth (MD) Shut-in Tubing Pressure (psig) Pressure at Datum (psig) Pressure at Datum (psig) Well Major Formation Upper Beluga Beluga Upper Tyonek Happy Valley Major formations Sterling c) Production for 2020 Calendar Year (sub-divided by major formation) d) Progress and tests to expand pool productive limits: No new exploration and development wells were drilled by Hilcorp in the Happy Valley PA. Page 3 Lower Tyonek HVA-01 0 0 HVA-02 40,951 40,951 HVA-03 0 HVA-08 85,697 21,410 64,287 HVA-09 0 0 0 0 HVA-10 217,222 0 217,222 0 HVA-11 0 0 0 0 HVB-12 374,597 0 151,279 223,318 HVB-13 60,241 5,397 54,844 0 HVB-14 0 0 HVB-15 285,005 285,005 HVB-17 347,409 6,948 340,461 Cum Gas Volume (MCF) 1,411,122 0 285,005 33,755 487,632 604,730 Happy Valley Tract Happy Valley PA Sterling Upper 2020 Cumulative Production, Mscf Well Upper Tyonek Beluga Beluga Beluga Beluga