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Home My WebLink About2021 Milne Point Unit Milne Point Unit Waterflood and Reservoir Surveillance Report for Kuparuk River Oil Pool Schrader Bluff Oil Pool Sag River Oil Pool January through December, 2021 Issued: April 1st, 2022 Outline 1. Introduction 2. Kuparuk River Oil Pool a. Project Summary b. Reservoir Voidage Balance Table c. Pressure Data d. Injection Surveys 3. Schrader Bluff Oil Pool a. Project Summary b. Reservoir Voidage Balance Table c. Pressure Data d. Injection Surveys 4. Sag River Oil Pool a. Project Summary b. Reservoir Voidage Balance Table c. Pressure Data 5. Milne Point Pool Allocation Factors 6. Milne Point 2021 Development Review and 2022 Development Plan ANNUAL RESERVOIR SURVEILLANCE REPORTS MILNE POINT UNIT KUPARUK RIVER OIL POOL SCHRADER BLUFF OIL POOL SAG RIVER OIL POOL JANUARY - DECEMBER 2021 Introduction As required by Conservation Order 205 for the Kuparuk River Oil Pool, approved October 4, 1984, Conservation Order 477, approved August 23, 2002 for the Schrader Bluff Oil Pool, Conservation Order 423 for the Sag River Oil Pool, approved May 6, 1998, and Conservation Order 550.007 for all Milne Point Pools, approved January 6, 2009, and Conservation Order 550.006 for all Milne Point Pools, amended February 14, 2015, this report provides a consolidated summary of surveillance activities within the Milne Point Unit. The report includes surveillance data associated with waterflood projects and development activities. The time period covered is January through December 2021. Kuparuk River Oil Pool Waterflood Project Summary Cumulative water injection since waterflood startup through the end of 2021 is 664.3 MMSTB and cumulative gas injection is 119.3 BSCF. This data shows that the voidage replacement ratio averaged 0.86 RB/RB in 2020 compared to 0.90 RB/RB in 2021. The Kuparuk River Oil Pool is split up in Hydraulic Units which represent regions of the reservoir that are believed to be hydraulically isolated due to faulting and/or lithologic controls. In 2021, 13 static pressure readings were obtained in the Kuparuk River reservoir. Average pressure from those readings was 3,016 psi at a datum depth of 7000’ SSTVD Milne Point Unit Kuparuk Pool Daily Production Rate Averages By Month:Daily Injection Rate Averages By Month: Oil Water Gas Reservoir Water Gas Voidage Voidage Voidage Month Prod Rate Prod Rate Prod Rate Voidage Inj Rate Inj Rate Replacement Replacement Balance 12/31/2012 (stb/day)(stb/day)(mscf/day)(rbbl/day)(stb/day)(mscf/day)(rbbl/day)Ratio (rbbl/day) 1/31/2021 10,374 52,905 8,814 70,960 47,534 4,791 52,353 0.74 -18,607 2/28/2021 9,867 52,001 10,836 71,300 45,696 6,045 51,561 0.72 -19,739 3/31/2021 10,768 45,252 8,524 63,311 47,422 4,441 51,939 0.82 -11,373 4/30/2021 10,320 41,456 9,011 59,458 42,327 6,006 48,109 0.81 -11,349 5/31/2021 10,897 39,684 9,970 59,022 50,179 7,455 57,321 0.97 -1,701 6/30/2021 11,678 43,013 12,484 65,284 53,367 8,877 61,775 0.95 -3,509 7/31/2021 10,060 37,577 9,139 55,386 50,819 6,850 57,452 1.04 2,066 8/31/2021 10,830 37,651 9,381 56,390 48,763 8,045 56,388 1.00 -2 9/30/2021 10,146 35,761 10,009 54,369 44,103 9,404 52,824 0.97 -1,545 10/31/2021 9,090 37,068 9,381 54,170 37,992 8,901 46,190 0.85 -7,980 11/30/2021 9,224 37,274 10,394 55,373 45,787 9,561 54,668 0.99 -705 12/31/2021 9,460 36,013 10,628 54,514 43,429 10,145 52,775 0.97 -1,738 Cumulative Production By Month:Cumulative Injection By Month: Oil Water Gas Reservoir Water Gas Voidage Voidage Voidage Month Cumulative Cumulative Cumulative Voidage Cumulative Cumulative Replacement Replacement Balance 12/31/2012 (stb)(stb)(mscf)(rbbl)stb mscf (rbbl)Ratio (rbbl) 1/31/2021 321,601 1,640,047 273,229 2,199,748 1,473,565 148,509 1,622,944 0.74 -576,804 2/28/2021 276,270 1,456,025 303,408 1,996,410 1,279,474 169,253 1,443,719 0.72 -552,691 3/31/2021 333,806 1,402,803 264,234 1,962,656 1,470,080 137,656 1,610,105 0.82 -352,551 4/30/2021 309,605 1,243,685 270,326 1,783,726 1,269,801 180,172 1,443,259 0.81 -340,467 5/31/2021 337,819 1,230,218 309,077 1,829,669 1,555,538 231,109 1,776,936 0.97 -52,733 6/30/2021 350,330 1,290,383 374,508 1,958,518 1,601,013 266,300 1,853,252 0.95 -105,266 7/31/2021 311,849 1,164,875 283,313 1,716,963 1,575,381 212,348 1,780,998 1.04 64,035 8/31/2021 335,736 1,167,191 290,825 1,748,104 1,511,642 249,381 1,748,041 1.00 -63 9/30/2021 304,369 1,072,831 300,284 1,631,085 1,323,101 282,113 1,584,724 0.97 -46,361 10/31/2021 281,790 1,149,118 290,800 1,679,260 1,177,741 275,925 1,431,880 0.85 -247,380 11/30/2021 276,726 1,118,221 311,833 1,661,185 1,373,617 286,832 1,640,042 0.99 -21,144 12/31/2021 293,260 1,116,414 329,459 1,689,929 1,346,310 314,500 1,636,037 0.97 -53,891 Average: 2020 10,226 41,305 9,881 59,961 46,451 7,543 1,630,995 0.90 -190,443 Cumulative:stb stb mscf rb stb mscf rb rb 31-Dec-21 3,733,160 15,051,811 3,601,296 21,772,202 16,957,263 2,754,098 21,596,876 0.99 -175,325 RESERVOIR VOIDAGE BALANCE January - December 2021 Kuparuk 2020 PLT Surveys Well Name Reservoir Well Type Rec Date Log Type Field Analysis Final Determination MPU B-013 KUP WINJ 6/25/2021 STP/IPROF Inj. 2000 bwpd at 200 psi at 116 deg F.C 100%, B7 0% MPU C-019 KUP WINJ 12/10/2021 STP/IPROF Inj. 1500bwpd at 2750psi C 44%, B6 57%, A 0%. Encountered bailer full of schmoo. MPU C-028A KUP WAG 12/8/2021 STP/IPROF Inj. 2073 bwpd at 2883psi C 3%, B6 9%, A3 43%, A2 46% MPU E-026 KUP WAG 12/6/2021 STP/IPROF Inj. 2000 Mscf at 3350psi Inconclusive Data Schmoo in well caused spinners to plug. MPU L-016A KUP WINJ 12/11/2021 STP/IPROF Inj. 2250 bwpd at 950psi.B6 16%, A3/A2 84%, A1 0%. MPU L-021A KUP WINJ 12/11/2021 STP/IPROF Inj. 1380 bwpd at 2800psi.C 0%, B6 37%, A3 2%, A2 41%, A1 19% MPU L-063 KUP WINJ 12/11/2021 STP/IPROF Inj. 950bwpd at 2450psi.C 0%, B6 0%, A 100% Schrader Bluff Oil Pool Waterflood Project Summary The Schrader Bluff Oil Pool cumulative voidage replacement for the calendar year 2020 was 0.85 (target 1.0) with a cumulative voidage replacement for the life of the project is 0.86. Initial development of the Schrader Bluff pool began in 1991 in the Tract 14 area (G/H/I/ and J pads) and consisted of vertical producers and injectors being completed in most all of the Schrader Bluff sands (Na-Nf , Oa, and Oba). Injection into the pool begain approximately one year after the first producers were drilled. The vertical injectors were typically installed with selective completions allowing for regulation of injection into different reservoir sands. Starting in th late 1990’s development continued in the Tract 14 area with both infill drilling and delineation wells as well as wells being drilled from both existing B and E pads. The development strategy shifted toward drilling multli lateral horizontal producers that were supported by vertical multi sand injectors. In 2002 a new pad was installed, S Pad, with similar development strategy but split between the Nb and Oa/Oba sands with dedicated Nb sand horiztonal producers and Oa/Oba sand dual lateral producers. These producers were supported by vertical multizone regulated injectors. Limited development occurred upon the completion of the S Pad project until 2016 when delineation wells were drilled from L Pad. The development strategy again shifted to dedicated single sand horizontal producers and injectors. In 2019 another pad was built, M Pad, where further delineation of the Schrader Bluff began. In 2020 and 2021 efforts began do “redevelop” the existing Tract 14 and S Pad areas which involved P&A’ing the existing well stock in an individual sand and redrilling the area with horizontal wells. New developments in the Schrader continue to utilize source water primarily from the shallower prince creek formation. All new developments since Hilcorp’s purchase of the asset in 2014 have utilized clean source water for injection. Utilizing produced water for injection at Milne Point has shown to be detrimental to injectivity due to solids and produced crude carry over accumulating in the injection wells. All future developments in the Schrader Bluff will plan to use clean source water. Hilcorp continued the Schrader Bluff Nb sand polymer injection pilots at J and L pads that were started in 2018. Results continue to be very encouraging with observed decreased water cuts and delayed water breakthrough. Polymer injection facilities were installed and injection initiated in the Schrader Oa sand developments at F and Moose Pad in May and July of 2020, respectively. Polymer injection facilities were then installed at both I and E pads targeting the Schrader Bluff Nb and Oa reservoirs in the fall of 2020. Current total polymer injection rate into the Schrader Bluff is approximately 32,000 bwpd. Average pressure throughout the field is 1623 psi at reference depth of 4000’ SSTVD based on 2021 surveys taken. Original pressure at reference depth was 1730 psi. Milne Point Unit Schrader Bluff Pool Production Rate Averages:Injection Rate Averages: Oil Water Gas Reservoir Water Gas Voidage Voidage Voidage Month Prod Rate Prod Rate Prod Rate Voidage Inj Rate Inj Rate Replacement Replacement Balance 12/31/2012 (stb/day)(stb/day)(mscf/day)(rbbl/day)(stb/day)(mscf/day)(rbbl/day)Ratio (rbbl/day) 1/31/2021 24,629 23,846 8,298 55,877 44,111 0 44,552 0.80 -11,325 2/28/2021 23,700 25,080 8,086 56,081 47,262 0 47,734 0.85 -8,347 3/31/2021 21,514 23,006 8,027 52,203 43,339 0 43,772 0.84 -8,431 4/30/2021 23,801 23,358 8,691 55,348 43,652 0 44,088 0.80 -11,260 5/31/2021 25,197 24,130 8,585 57,045 47,113 0 47,584 0.83 -9,461 6/30/2021 25,110 24,426 7,608 55,776 50,572 0 51,078 0.92 -4,698 7/31/2021 24,073 25,389 9,020 58,115 49,809 0 50,307 0.87 -7,807 8/31/2021 25,494 24,598 9,935 59,819 49,262 0 49,754 0.83 -10,065 9/30/2021 25,967 27,487 11,317 65,225 47,987 0 48,467 0.74 -16,758 10/31/2021 25,509 31,930 10,618 68,285 51,019 0 51,530 0.75 -16,756 11/30/2021 26,109 31,826 10,734 68,823 51,968 0 52,487 0.76 -16,335 12/31/2021 27,407 31,465 11,136 70,079 55,598 0 56,154 0.80 -13,925 Cumulative Production:Cumulative Injection: Oil Water Gas Reservoir Water Gas Voidage Voidage Voidage Month Cumulative Cumulative Cumulative Voidage Cumulative Cumulative Replacement Replacement Balance 12/31/2012 (stb)(stb)(mscf)(rbbl)stb mscf (rbbl)Ratio (rbbl) 1/31/2021 763,497 739,230 257,225 1,732,194 1,367,451 0 1,381,126 0.80 -351,069 2/28/2021 663,597 702,254 226,422 1,570,271 1,323,330 0 1,336,563 0.85 -233,708 3/31/2021 666,925 713,190 248,836 1,618,301 1,343,497 0 1,356,932 0.84 -261,369 4/30/2021 714,035 700,755 260,725 1,660,440 1,309,558 0 1,322,654 0.80 -337,786 5/31/2021 781,100 748,026 266,145 1,768,391 1,460,489 0 1,475,094 0.83 -293,297 6/30/2021 753,305 732,771 228,232 1,673,278 1,517,166 0 1,532,338 0.92 -140,940 7/31/2021 746,268 787,056 279,623 1,801,552 1,544,087 0 1,559,528 0.87 -242,024 8/31/2021 790,321 762,536 307,975 1,854,394 1,527,116 0 1,542,387 0.83 -312,007 9/30/2021 778,997 824,602 339,519 1,956,743 1,439,605 0 1,454,001 0.74 -502,741 10/31/2021 790,765 989,828 329,173 2,116,843 1,581,601 0 1,597,417 0.75 -519,426 11/30/2021 783,285 954,775 322,028 2,064,684 1,559,030 0 1,574,620 0.76 -490,064 12/31/2021 849,625 975,414 345,216 2,172,453 1,723,543 0 1,740,778 0.80 -431,674 Average: 2021 24,876 26,378 9,338 60,223 48,474 0 48,959 0.81 -11,264 Cumulative:stb stb mscf rb stb mscf rb rb 31-Dec-21 9,081,721 9,630,436 3,411,118 21,160,099 17,696,473 0 18,050,402 0.85 -3,109,696 RESERVOIR VOIDAGE BALANCE January - December 2021 6. Oil Gravity: 13-22 8. Well Name and Number: 9. API Number 50XXXXXXXXXXXX NO DASHES 10. Type See Instructions 11. AOGCC Pool Code 12. Zone 13. Perforated Intervals Top - Bottom TVDSS 14. Final Test Date 15. Shut-In Time, Hours 16. Press. Surv. Type (see instructions for codes) 17. B.H. Temp. 18. Depth Tool TVDSS 19. Final Observed Pressure at Tool Depth 20. Datum TVDSS (input) 21. Pressure Gradient, psi/ft. 22. Pressure at Datum (cal) S-24 500292204400 O 525140 Nb 3965-3824 3/12/2021 80596 SBHP 78 3882 1497 4000.00 0.41 1545 S-06 500292316300 WI 525140 Nb 4000-4009 3/7/2021 56973 SBHP 77 3927 1692 4000.00 0.43 1724 S-14 500292080400 WI 525140 Nb 3863-3877 3/7/2021 89235 SBHP 75 3851 1857 4000.00 0.43 1924 J-26 500292320500 O 525140 Oa/Ob 3749-3967 4/10/2021 5952 SBHP 77 3789 1323 4000.00 0.41 1410 G-08 500292214100 O 525140 Na/Nb/Nc/Ne/Nf/Oa/Ob 3906-4253 8/3/2021 34941 SBHP 69 3298 1585 4000.00 0.41 1873 G-14 500292303100 O 525140 Na/Nb/Ne/Oa/Ob 3929-4152 11/18/2021 673 SBHP 79 3850 1570 4000.00 0.41 1632 G-18 500292319400 O 525140 Oa/Ob 4079-4120 6/25/2021 866 SBHP 84 3863 1317 4000.00 0.41 1373 H-19 500292337100 O 525140 Oa 4067-4116 6/28/2021 977 SBHP 81 3917 1196 4000.00 0.41 1230 I-03 500292206700 O 525140 Na/Nb/Nc/Ne/Oa/Ob 3733-3972 10/23/2021 7381 SBHP 78 3464 1343 4000.00 0.41 1563 I-11 500292303300 O 525140 Oa/Ob 3497-3612 3/5/2021 999 SBHP 71 3369 1434 4000.00 0.41 1693 J-19 500292260700 WI 525140 Oa 4014-4047 2/9/2021 9474 SBHP 81 3729 1716 4000.00 0.43 1835 J-19 500292260700 WI 525140 Ob 4079-4101 2/9/2021 9474 SBHP 81 3871 1785 4000.00 0.43 1842 J-19 500292260700 WI 525140 Nb 3875-3911 2/9/2021 9474 SBHP 81 4010 1463 4000.00 0.43 1459 M-10 500292361700 O 525140 Oa 3950-4000 10/2/2021 397 SBHP 77 3797 1404 4000.00 0.41 1487 M-19 500292365500 WI 525140 Oa 3600-3650 9/12/2021 245 SBHP 61 3422 1769 4000.00 0.43 2023 M-25 500292366800 WI 525140 Oa 3450-3546 9/15/2021 551 SBHP 61 3325 1685 4000.00 0.43 1982 S-44 500292273500 WI 525140 Nb 3450-3546 11/30/2021 834 SBHP 75 3880 1568 4000.00 0.43 1621 I-28 500292369100 WI 525140 Oa 3880-4000 5/2/2021 306 SBHP 72 3744 1575 4000.00 0.43 1688 I-36 500292367700 O 525140 Nb 3756-3889 4/16/2021 706 SBHP 72 3741 1243 4000.00 0.41 1349 J-27 500292355700 O 525140 Nb 3549-3687 6/18/2021 596 SBHP 76 3473 1048 4000.00 0.41 1264 L-47 500292355000 O 525140 Oa 4065-4113 1/14/2021 559 SBHP 76 3357 1311 4000.00 0.41 1575 Average 1623 3. Unit or Lease Name:4. Field and Pool:5. Datum Reference:7. Gas Gravity: Milne Point Milne Point - Schrader Bluff 4000 0.56 STATE OF ALASKA ALASKA OIL AND GAS CONSERVATION COMMISSION RESERVOIR PRESSURE REPORT 1. Operator:2. Address: Hilcorp Alaska LLC 3800 Center Point Dr, Anchorage , AK 99503 Schrader Bluff PLT Logs and Analysis Two PLT logs were run on multi-sand injectors in 2021. Total active injector count in the Schrader Bluff is 62 with a total of 9 active multi-sand injectors at the end of 2021. These wells are B-02, E-12, G-01, I-07A, I-16, I-18, J-05, S-02, and S-15. The remaining active injectors are either dual string vertical injectors targeting single intervals, single string horizontal injectors targeting individual sands, or selective completions that are only injecting into a single zone. Well Name Reservoir Well Type Rec Date Log Type Field Analysis Final Determiation I-07A Schrader Bluff WINJ 12/7/2021 IPROF 100% Na sand flow too low to measure with spinner (290 bwpd) in 7" casing. Temperature log indicates flow into all sands as logged temperatures across all sands are below normal temperature gradient I-18 Schrader Bluff WINJ 12/8/2021 IPROF 100% Oa sand Spinner analysis indicates 66% Nb sand, 33% Oa sand, and 0% Oba sand. Tagged above Oba sand so could not log. Temperature log indicates 0 flow to Oba sand. Sag River Oil Pool Waterflood Project Summary A Participating Area for the Sag was approved in 2005. During 2021, Sag Oil Pool had the field total to 5 production wells with no active injection wells. There was no production from the reservoir in most of 1999 and the entire year of 2000 because it was not economical to repair the failed ESPs. At the end of 2000, one well (MPC-23) was converted to a jet pump completion. In 2001, one well (MPF-33A) was side-tracked and completed with a jet pump completion and another well (MPF-73A) was deepened from an idle Kuparuk well into the Sag River reservoir as an injector. One producing well (MPC-23) was shut in for integrity reasons in 2002 and the injection well (MPF-73A) was changed to water service only in 2006 due to tubing to inner annulus communication on gas injection. The Sag River Pool oil production averaged 415 STBD and water production averaged 689 STBD in 2021. Cumulative production through the end of 2021 was 3.98 MMSTB of oil, 5.8 BSCF of gas, and 4.4 MMSTB of water. During 2021 one pressure surveys in the S-90 well was obtained indicating a reservoir pressure of 3763 psi at a datum depth of 8750’ SSTVD. As this is a single well this not indicative of the average reservoir pressure of the pool. Milne Point Unit Sag Pool Production Rate Averages:Injection Rate Averages: Oil Water Gas Reservoir Water Gas Voidage Voidage Voidage Month Prod Rate Prod Rate Prod Rate Voidage Inj Rate Inj Rate Replacement Replacement Balance 12/31/2012 (stb/day)(stb/day)(mscf/day)(rbbl/day)(stb/day)(mscf/day)(rbbl/day)Ratio (rbbl/day) 1/31/2021 316 1,293 774 2,402 0 0 0 0.00 -2,402 2/28/2021 282 1,208 570 2,066 0 0 0 0.00 -2,066 3/31/2021 339 905 804 2,055 0 0 0 0.00 -2,055 4/30/2021 404 861 1,097 2,379 0 0 0 0.00 -2,379 5/31/2021 388 918 1,058 2,383 0 0 0 0.00 -2,383 6/30/2021 503 791 704 1,951 0 0 0 0.00 -1,951 7/31/2021 518 1,136 657 2,263 0 0 0 0.00 -2,263 8/31/2021 505 521 606 1,570 0 0 0 0.00 -1,570 9/30/2021 490 93 1,024 1,581 0 0 0 0.00 -1,581 10/31/2021 252 140 728 1,127 0 0 0 0.00 -1,127 11/30/2021 425 137 678 1,198 0 0 0 0.00 -1,198 12/31/2021 559 268 1,005 1,789 0 0 0 0.00 -1,789 Cumulative Production:Cumulative Injection: Oil Water Gas Reservoir Water Gas Voidage Voidage Voidage Month Cumulative Cumulative Cumulative Voidage Cumulative Cumulative Replacement Replacement Balance 12/31/2012 (stb)(stb)(mscf)(rbbl)stb mscf (rbbl)Ratio (rbbl) 1/31/2021 9,806 40,091 24,003 74,463 0 0 0 0.00 -74,463 2/28/2021 7,889 33,824 15,968 57,847 0 0 0 0.00 -57,847 3/31/2021 10,504 28,055 24,925 63,715 0 0 0 0.00 -63,715 4/30/2021 12,120 25,828 32,905 71,382 0 0 0 0.00 -71,382 5/31/2021 12,027 28,444 32,794 73,860 0 0 0 0.00 -73,860 6/30/2021 15,076 23,732 21,107 58,521 0 0 0 0.00 -58,521 7/31/2021 16,073 35,210 20,360 70,151 0 0 0 0.00 -70,151 8/31/2021 15,667 16,161 18,771 48,679 0 0 0 0.00 -48,679 9/30/2021 14,707 2,787 30,734 47,425 0 0 0 0.00 -47,425 10/31/2021 7,813 4,349 22,557 34,942 0 0 0 0.00 -34,942 11/30/2021 12,740 4,113 20,342 35,936 0 0 0 0.00 -35,936 12/31/2021 17,324 8,308 31,161 55,468 0 0 0 0.00 -55,468 Average: 2020 415 689 809 1,897 0 0 0 0.00 -1,897 Cumulative:stb stb mscf rb stb mscf rb rb 31-Dec-21 151,746 250,903 295,627 641,805 0 0 0 0.00 -641,805 RESERVOIR VOIDAGE BALANCE January - December 2021 6. Oil Gravity: 38 8. Well Name and Number: 9. API Number 50XXXXXXXXXX XX NO DASHES 10. Type See Instructio ns 11. AOGCC Pool Code 12. Zone 13. Perforated Intervals Top - Bottom TVDSS 14. Final Test Date 15. Shut- In Time, Hours 16. Press. Surv. Type (see instructions for codes) 17. B.H. Temp. 18. Depth Tool TVDSS 19. Final Observed Pressure at Tool Depth 20. Datum TVDSS (input) 21. Pressure Gradient, psi/ft. 22. Pressure at Datum (cal) MP S-90 50029232760000 PROD 525150 Sag A, B 8,791’-8,827’11/12/2021 1440 DH Press Gauge 223 8507 3662 8750 0.43 3763 3. Unit or Lease Name:4. Field and Pool:5. Datum Reference:7. Gas Gravity: Milne Point Sag River Oil Pool 8750' SS 0.65 STATE OF ALASKA ALASKA OIL AND GAS CONSERVATION COMMISSION RESERVOIR PRESSURE REPORT 1. Operator:2. Address: Hilcorp Alaska , LLC.3800 Centerpoint Dr. Anchorage, AK, 99516 MPU Pool Allocation Factors Total Milne Point production increased a total of 0.916 MMBO from 2020 to 2021 primarily due to development drilling in the Kuparuk and Schrader Bluff pools. A decrease in water production can be attributed to several high water Kuparuk producers being SI for ESP failures. Increase in total gas can be attributed to Schrader Bluff development drilling into previously developed lower pressure ares which contain higher gas saturations. Production Pool Oil Water Gas Oil Water Gas Oil Water Gas stb stb mscf stb stb mscf stb stb mscf Schrader Bluff 8614974 7204448 2255178 9081721 9630436 3411118 466747 2425988 1155940 Kuparuk 3287363 20122349 4037614 3733160 15051811 3601296 445797 -5070538 -436318 Sag River 147638 391805 367541 151746 250903 295627 4108 -140902 -71914 Total 12049975 27718602 6660333 12966627 24933150 7308041 916652 -2785452 647708 Allocation Pool Oil Water Gas Oil Water Gas Oil Water Gas frac frac frac frac frac frac frac frac frac Schrader Bluff 0.71 0.26 0.34 0.70 0.39 0.47 -0.01 0.13 0.13 Kuparuk 0.27 0.73 0.61 0.29 0.60 0.49 0.02 -0.12 -0.11 Sag River 0.01 0.01 0.06 0.01 0.01 0.04 0.00 0.00 -0.01 20212020 2020 2020 2021 - 2020 Delta 2021 - 2020 Delta MPU Well Tests and Oil Allocation Factors 2021 Date Kuparuk Schrader Sag Total Kuparuk Schrader Sag Total Kuparuk Schrader Sag Total 1 Jan-21 255 114 17 386 69 49 6 124 3.7 2.3 2.8 3.1 0.85 2 Feb-21 233 152 12 397 67 51 5 123 3.5 3.0 2.4 3.2 0.86 3 Mar-21 291 182 19 492 70 53 5 128 4.2 3.4 3.8 3.8 0.91 4 Apr-21 309 162 18 489 69 52 6 127 4.5 3.1 3.0 3.9 0.91 5 May-21 211 153 14 378 70 53 5 128 3.0 2.9 2.8 3.0 0.88 6 Jun-21 280 145 10 435 71 53 5 129 3.9 2.7 2.0 3.4 0.88 7 Jul-21 235 138 18 391 68 55 5 128 3.5 2.5 3.6 3.1 0.85 8 Aug-21 270 172 14 456 65 55 5 125 4.2 3.1 2.8 3.6 0.90 9 Sep-21 227 179 17 423 68 55 5 128 3.3 3.3 3.4 3.3 0.90 10 Oct-21 231 174 11 416 73 56 5 134 3.2 3.1 2.2 3.1 0.85 11 Nov-21 269 148 14 431 68 56 5 129 4.0 2.6 2.8 3.3 0.88 12 Dec-21 209 157 13 379 70 56 5 131 3.0 2.8 2.6 2.9 0.93 Well Test Count Active Well Count Average Well Test per well MPU Oil Allocation Factor Annual Plans of Development Review (39th (2021) and 40th (2022)) The following annual report describes the operations conducted under the 39th POD as required by 11 AAC 83.343(d). A. 39th POD Production Summary During calendar year 2021, the MPU produced approximately 5,340.9 million cubic feet (“MMcf”) of gas and 9,725.9 thousand barrels (“Mbbl”) of oil.1 From January 1, 2021 through September 30, 2021, the average daily production rate was 35,757 barrels of oil per day (“BOPD”). B. 39th POD Drilling Program Hilcorp Alaska anticipated drilling up to 22 new wells under the 39th POD. During the 39th POD period to date, Hilcorp Alaska has drilled 12 new wells, including: • S Pad – Anticipated drilling five wells (two injectors, three producers). Successfully completed five wells (three injectors, two producers) detailed below: o S-44 – horizontal injector – Schrader Bluff Nb Sand o S-45 – horizontal producer – Schrader Bluff Nb Sand o S-46 – horizontal injector – Schrader Bluff Nb Sand o S-47 – horizontal producer – Schrader Bluff Nb Sand o S-48 – horizontal injector – Schrader Bluff Nb Sand • I Pad – Anticipated drilling 14 wells (six injectors, eight producers). Successfully completed five wells detailed below. Remaining nine anticipated wells were put on hold due to completion equipment availability and desire to observe results from the first two producer/injection patterns in each sand. o I-07A – vertical injector – Schrader Bluff Sands o I-20 – horizontal producer – Schrader Bluff Oba Sand o I-21 – horizontal injector – Schrader Bluff Oba Sand o I-27 – horizontal producer – Schrader Bluff Oa Sand o I-28 – horizontal injector – Schrader Bluff Oa Sand 1 Milne Point Unit has not historically and is not currently equipped to sell natural gas liquids (“NGLs”). All of the oil prod uced/sold from the Milne Point field is conventional black oil. • J Pad – Anticipated drilling three wells (two injectors, one producer). Successfully drilled two wells detailed below. The third well, an injector, was put on hold due to complications with running completions on both completed wells. o J-29A – horizontal producer – Schrader Bluff Nb Sand o J-30 – horizontal injector Schrader Bluff Nb Sand C. 39th POD Workover Program Hilcorp Alaska anticipated completing up to 31 workovers under the 39th POD. To date, Hilcorp Alaska has completed 12 workovers, including: • ASR1 Workover Rig – Anticipated completing up to 20 well workovers. Due to budgetary constraints, as well as fewer electric submersible pump (ESP) failures, eleven workover operations were executed and are detailed below: o F-34 – ESP swap – Kuparuk A Sands o F-69 – conversion to injector – Kuparuk A Sands o F-96 – ESP swap – Kuparuk A Sands o G-14 – ESP swap – Schrader Bluff Sands o I-38 – ESP swap – Schrader Bluff Nb Sand o I-38 – ESP swap – Schrader Bluff Nb Sand (2nd) o I-40 – conversion to jet pump – Schrader Bluff Nb Sand o L-04 – ESP swap – Kuparuk A Sands o L-07 – ESP swap – Kuparuk A Sands o L-47 – ESP swap and repair leak in 7” tieback – Schrader Bluff Oa Sands o L-62 – ESP swap – Schrader Bluff NB Sand • Doyon 14 Workover Rig – Anticipated completing up to eleven well workovers, beginning with the installation of a 4 ½-inch screened liner inside the existing 6-5/8-inch liner on the M-26 Well. Due to unsuccessful operations on the M-26 Well, the remainder of the planned workovers were cut from the schedule. D. 39th POD Sidetrack Drilling Program Hilcorp Alaska anticipated performing coiled tubing drilling operations on seven wells under the 39th POD as detailed below: • C Pad – Successfully sidetracked two wells as anticipated: o C-04A – Kuparuk C Sand o C-11A – Kuparuk C Sand • F Pad – Anticipated sidetracking four wells. Successfully sidetracked two wells detailed below. One anticipated well was deferred due to complexity issues. One anticipated well was deferred due to prior well results. o F-22A – Kuparuk A Sand o F-05L – Dual lateral – Kuparuk A Sand • L Pad – Hilcorp anticipates sidetracking the L-06A Well in December. E. 39th POD Major Facility Projects Hilcorp Alaska completed the following facility projects outlined in the 39th POD: • Moose Pad polymer facility installation and start up • I Pad polymer facility installation and start up • E Pad polymer facility installation and start up • Fuel gas compressor installation and startup • S Pad polymer engineering/procurement • S Pad header expansion and polymer facility project • Transformer replacement on Tract 14 • Upgrade L Pad polymer systems The following projects were anticipated during the 39th POD period but deferred: • 2020 Shutdown for A-Train process vessel inspections and upgrades – historical data and external inspections suggested that this could be delayed another year. • B Pad gas injection compressor installation and start up – internal economic evaluation was not completed so project was not executed. • V-5304 Grid replacement – project tied to A-Train shutdown project and was deferred accordingly. • S Pad test separator replacement – Opted to replace G Pad test separator. Project anticipated for 2022. • Solar Titan 130 power generator engineering/procurement – Power demand did not increase as expected • Diesel tank to slop oil tank conversion – deferred in favor of other projects. III. 40th PLAN OF DEVELOPMENT AND OPERATIONS For the period of January 13, 2022 through January 12, 2023, Hilcorp Alaska anticipates completing the following drilling, workover and facility projects. A. Proposed Drilling Program Hilcorp Alaska anticipates drilling up to 17 new wells during the 40th POD period. Potential drilling candidates include: • 10 I Pad Schrader Bluff wells (six producers, four injectors) • 7 M Pad or B Pad Schrader Bluff wells (four producers, three injectors) B. Proposed Sidetrack Drilling Program Hilcorp Alaska anticipates performing coiled tubing drilling operations on six wells during the 40th POD period. Potential candidates include: • B Pad o B-16 Well • C Pad o C-02 Well o C-19 Well • E Pad o E-17 Well • K Pad o K-02 Well o K-17 Well C. Proposed Wellwork and Workover Program During the 39th POD period, Hilcorp Alaska does not anticipate any planned workover, workovers will be executed to maintain and enhance production as needed. D. Major Facility Projects Key facility projects Hilcorp Alaska anticipates undertaking during the 40th POD period may include: • F Pad Power Fluid Separation System installation • B-Pad polymer unit installation • M Pad upgraded polymer unit installation • S Pad multiphase meter replacement • E Pad production header replacement • J Pad Water Softening System installation (for polymer makedown and dilution) • Install new produced water treatment equipment at CFP • Solar Titan 130 power generator engineering/procurement Other projects may include, but are not limited to: • B Pad Gas injection compressor installation • E Pad Power Fluid Booster installation • L Pad 2nd polymer unit installation • Shutdown for A-Train process vessel inspections and upgrades • Diesel tank to slop oil tank conversion • Tract 14 production heater installation • M Pad water softening system installation • S Pad produced water treatment equipment installation E. Long-Range Activities Hilcorp Alaska is evaluating the following potential long-term activities: • Future drilling opportunities both on undeveloped acreage in the northwest of the unit, particularly in the Net Profit Share Leases (“NPSL”), and previously developed acreage from I, H, and S Pads in the Schrader Bluff PA. • Evaluation of continued performance from Ugnu horizontal producing well S-203 to help determine future Ugnu development strategy. • Continue to evaluate infill drilling opportunities in the Kuparuk sands via conventional and coiled tubing drilling.