ii - dog.dnr.alaska.govdog.dnr.alaska.gov/documents/publicnotices/20171204_lons88-002... · to...

II Hilcorp Alaska, LLC

October 24, 2017

DOG Permitting Alaska Department of Natural Resources Division of Oil and Gas 550 W. 7th Ave., Suite 800 Anchorage, Alaska 99501-3577

Amendment to Unit Plan of Operations

MPU L Pad Gravel Additions for Power and Development Wells

LO/NS 83-085

Milne Point Unit

DOG Permitting:

Post Office Box 244027 Anchorage, AK 99524

3800 Centerpoi nt Dr

Suite 1400 Anchorage, AK 99503

Phone: 907/777-8300

Fax: 907 /777-8560

Hilcorp Alaska, LLC (Hilcorp) proposes to add gravel to the existing gravel pad at L Pad to install three Titan 130 Turbine skids and infrastructure and drill five additional development wells at L Pad, located in the Milne Point Unit (MPU). The purpose of this project is to increase the pad size to accommodate the Turbine skids, Diesel Tanks, electrical equipment room and switchgear rooms and to accommodate the additional development wells. Milne does not have any spare power for adding new production wells, so additional pad space is required to add the power generation facilities.

In support of our request, attached are the following:

• Lease/Unit Plan of Operations Amendment Application;• Figures and Drawings;• Project Description/Plan of Operations.

Please note that the drilling of the additional wells and facility upgrades to support new drilling are included in our 2017 MPU Unit Plan of Development.

Thank you for your consideration of this request. If you have any questions, or require additional information, please contact me, Deborah Heebner or Stefan Gogosha at (907) 670-3382 or email [email protected].

Sincerely,

Q�tlL�� Deborah K. Heebner Environmental Specialist HILCORP ALASKA, LLC

Enclosure

UNIT PLAN OF OPERATIONS AMENDMENT APPLICATION

State of Alaska Department of Natural Resources, Division of Oil & Gas 550 W. 7th Ave, Suite 1100, Anchorage, AK 99501-3563

Phone: 907-269-8800 Fax: 907-269-8943 Permitting Email: [email protected]

Unit Plan of Operations Amendment Application V1.0 Revised 06/01/2015

SECTION I: APPLICANT INFORMATION

1. Applicant: 2. Applicant Contact:

Name: Hilcorp Alaska, LLC

First Name:

Deborah Last Name:

Heebner

Title: North Slope Environmental Specialist

Mailing Address:

3800 Centerpoint Dr. Ste. 1400 Mailing Address:

3800 Centerpoint Dr. Ste. 1400

City: Anchorage City: Anchorage

State: Alaska Zip Code: 99503 State: Alaska Zip Code: 99503

Phone: 907-777-8300 Fax: 907-777-8301 Phone: 907-670-3382 Fax: 907-777-8301

Email: N/A Email: [email protected]

3. Unit Name Milne Point Unit

4. Unit Operator Contact:

First Name: Enter First Name. Last Name: Enter Last Name. Title: Enter Title.

Mailing Address: Enter Mailing Address.

City: Enter City. State: Alaska Zip Code: Enter Zip Code.

Phone: Enter Phone. Fax: Enter Fax. Email: Enter Email.

Describe the relationship between the Unit Operator and the Applicant:

Hilcorp Alaska, LLC is both unit operator and applicant; see applicant contact information above.

SECTION II: 3RD PARTY INFORMATION

(Fill out this section only if you are applying for the Applicant)

SECTION III: APPLICATION DATE AND NUMBER

3rd Party Company Name:

Enter Name. Application Date (Office Use Only):

First Name:

Enter First Name. Last Name:

Enter Last Name.

Title: Enter Title.

Mailing Address:

Enter Mailing Address.

City: Enter City.

State: Enter State. Zip Code: Enter Zip Code.

Phone: Enter Phone. Fax: Enter Fax.

Email: Enter Email.

Describe the affiliation to the Applicant: Application Number: LO/NS 83-085

Describe your affiliation to the Applicant.

SECTION IV: PROJECT INFORMATION

1. Project Name: Milne Point Unit L Pad Gravel Additions for Power and Development Wells

2. Proposed Start Date: 3/1/2018

3. Project Description:

Is activity discussed in the approved Plan of Development on file with the Division’s Units Section? ☒ Yes ☐ No

mailto:[email protected]

Unit Plan of Operations Amendment Application V1.0 Page 2 of 10 Revised 06/01/2015

Describe what and where:

Hilcorp Alaska, LLC requests approval to extend the existing Milne Point Unit (MPU) L Pad to install three Titan 130 Turbines skids, fuel gas metering skid, two 1100 barrel Diesel Tanks in containment for emergency start-ups, piping for diesel and fuel gas supply to the Titans, electrical equipment rooms and switchgear rooms. Hilcorp is also requesting approval to extend the existing pad to drill up to five additional development wells at MPU L Pad. The purpose of the proposed activities is the expansion of oil resource development infrastructure and the increase of production within the MPU.

SECTION V: LAND STATUS

1. State Mineral Estate:

Are supplemental pages for land status included in Appendix C? ☐ Yes ☒ No

Affected ADL: ADL# 025509 Date Effective: 2/1/1965 Date Assigned: 11/1/2014

Oil And Gas Lessee(s): Hilcorp Alaska, LLC

Surface Ownership: State of Alaska

Do you have, or anticipate having an Access Agreement: ☒ Yes ☐ No

Special Use Lands: Special Use Lands under II AAC 96.014, ADL 50666

Jointly Managed Lands: Click here to enter text.

Other Considerations: Click here to enter text.

Project Components Meridian, Township, Range, And Section(s) GPS Coordinates

L Pad Umiat Meridian, T13N, R10E, Sec. 7 and Sec. 8 70.496717” N, -149.63534” W (NAD83)

Click here to enter text. Click here to enter text. Click here to enter text.


2. State of Alaska Surface Lands:


Oil And Gas Mineral Estate Owner:

Access Authorization(s):

Special Use Lands:

Jointly Managed Lands:





3. Private Lands:


Oil And Gas Mineral Estate Owner: Click here to enter text.

Surface Ownership And Access Agreement(s): Click here to enter text.

Special Use Lands: Click here to enter text.

Jointly Managed Lands: Click here to enter text.






SECTION VI: SEQUENCE AND SCHEDULE OF OPERATIONS

Project Project Milestone Proposed Start Date Proposed End Date


Milestone #

1. Excavate gravel from exisitng permitted sources; 3/1/2018 5/1/2018

2. Placement of Gravel on tundra with equipment working from existing pad; 3/1/2018 5/1/2018

3. Spread and compact gravel with equipment working from existing gravel pad to match existing pad surface elevation;

3/1/2018 8/1/2018

4. Install VSMs and pilings for Turbine Skids, fuel gas metering skid, fuel gas and diesel piping, electrical equipment rooms and switchgear room;

3/1/2018 7/1/2018

5. Install diesel piping in existing F to L Pad Water Pipeline pipe rack adding up to 5 VSMs as required;

3/1/2018 7/1/2018

6. Install electrical equipment rooms and switchgear room; Expand electrical skid at the entrance to L Pad adding up to 6 VSMs;

3/1/2018 10/31/2018

7. Trench on pad and in tundra to install power and communication cables; 3/1/2018 10/31/2018

8. Drill 5 additional Development Wells; 7/1/2018 1/1/2019

9. Install additional piping and infrastructure to tie-in wells to existing production;

7/1/2018 1/1/2019

10. Tie-in new wells to existing infrastructure and production. 8/1/2018 2/1/2019

SECTION VII: PROJECTED USE REQUIREMENTS

1. Describe the proposed operations, including the location and design, of Well Sites:

The proposed pad addition to the southeasterly edge of L Pad will cover approximately 0.2 acres as shown on the attached figure. The proposed pad addition to the southerly edge of L Pad will cover approximately 1.14 acres as shown on the attached figure. The surface elevation of the expansion will be level with the existing pad surface elevation. Approximately 0.0003 acres of tundra will be impacted by installing up to 11 Vertical Support Members (VSMs) for the fuel gas lines to the Titans and for the expanded electrical skid at the entrance to L Pad.

Hilcorp proposes to install three Titan 130 Turbine skids on the proposed gravel addition along the southerly edge of L Pad to provide the additional power required for additional facilities including Moose Pad and additional production wells in the Milne Point Unit. All producing wells in Milne Point Unit require special equipment or techniques (“artificial lift”) to enhance the flow of oil to the surface. As “artificial lift”, Milne uses electrical submersible pumps (ESP’s) jet pumps and gas lift to increase rates. Over 70% of the wells at Milne use ESP’s, which require electrical power, so increasing the number of producing wells, increases the demand for power. Milne does not have any spare power for adding new production wells. Less than 1% of the Milne Point Unit is covered with gravel, thanks to technological advances that have allowed reduction of pad size and reduction in roads from those used in the earlier days of North Slope Oil production. However, additional space is required for the installation of power generation facilities at L Pad.

Hilcorp proposes to install a fuel gas metering skid and piping for diesel and fuel gas supply to the Turbine skids. Hilcorp proposes to install two 1130 barrel (47,460 gallons) Diesel Tanks in containment on the proposed southeasterly gravel addition to provide diesel to the turbines during facility shutdowns or when fuel gas is not available. The fuel line between the diesel tanks and the Titan 130s will be installed in the existing pipe rack for the MPU F to L Pad Water Injection 8” pipeline to the extent possible. Existing pipe supports will be used to the extent possible, but as the fuel line comes off the gravel addition from the diesel tanks, up to three Vertical Support Members may be required prior to meeting the existing pipe rack. The on-pad piping for diesel and fuel gas supply to the Turbine skids will be placed on VSMs drilled into the gravel pad addition.

Hilcorp also proposes to install Electrical Equipment Rooms associated with each turbine skid and a switchgear room. The Titan 130 Turbine Skids, Electrical Equipment Rooms and Switchgear Room will be placed on pilings. Stairs and ladders will access the skids, landings and rooms. The project will involve trenching in the gravel pad as required for power and communication lines. Electrical cables from the existing electrical skids at the entrance of L Pad will also be trenched into the tundra near the toe of the gravel pad to the gravel pad addition along the southerly edge of L Pad supporting the Titan Turbines skids.

Hilcorp seeks approval to add a gravel addition along the northerly edge of L Pad to drill up to five additional development wells and install associated infrastructure to facilitate production activities. An overview of MPU is provided in Figure 1. Figure 2 shows current facilities and well locations on L Pad, as well as the approximate surface locations for the proposed wells, related infrastructure, gravel pad additions and power generation infrastructure.

2. Describe the proposed operations, including the location and design, of Buildings:

Hilcorp proposes to install three Titan 130 Turbine skids on the proposed gravel addition along the southerly edge of L Pad to provide the additional power required for additional facilities including Moose Pad and additional production wells in the Milne Point Unit. Hilcorp proposes to install a fuel gas metering skid and piping for diesel and fuel gas supply to the Turbine skids. Hilcorp proposes to install two 1130 barrel (47,460 gallons) Diesel Tanks in containment on the proposed southeasterly gravel addition to provide diesel to the turbines during facility shutdowns or when fuel gas is not available. Hilcorp also proposes to install Electrical Equipment Rooms associated with each turbine skid and a switchgear room. The Titan 130 Turbine Skids, Electrical Equipment Rooms and Switchgear Room will be placed on pilings. Stairs and ladders will access the skids, landings and rooms. The project will involve trenching in the gravel pad as required for power and communication lines. The existing electrical skids at the entrance to L Pad will be expanded requiring the addition of up to 6 VSMs. Electrical cables from the existing electrical skids at the entrance of L Pad will also be trenched into the tundra near the toe of the gravel pad to the gravel pad addition along the southerly


edge of L Pad supporting the Titan Turbines skids. Hilcorp seeks approval add a gravel addition along the northerly edge of L Pad to drill up to five additional development wells and install associated infrastructure to facilitate production activities at MPU L Pad. An overview of MPU is provided in Figure 1. Figure 2 shows current facilities and well locations on L Pad, as well as the approximate surface locations for the proposed wells, related infrastructure, gravel pad additions and power generation infrastructure.

3. Describe the proposed operations, including the location and design, of Fuel and Hazardous Substances:

Approximately 500 barrels of ultra-low sulfur diesel (ULSD) will be stored on site to support drilling operations. Additional hazardous substances that may be onsite include ethylene glycol and/or methanol. All fuel and hazardous substances will be stored and handled in accordance with standard operating procedures.

4. Describe the proposed operations, including the location and design, of Solid Waste Sites:

The project is not expected to generate any significant quantities of waste materials. Any solid waste generated as part of this project will be disposed of in an approved manner at existing North Slope Facilities. Solid wastes and combustibles will be hauled off-site to the North Slope Borough landfill. Waste will be handled consistent with Hilcorp waste management practices as outlined below:

1) Waste will be properly segregated, labeled, and stored to ensure proper disposal.

5. Describe the proposed operations, including the location and design, of Water Supplies:

Existing Alaska Department of Natural Resources (ADNR) permitted water sources will be utilized to support drilling operations. All water use will be tracked in compliance with applicable permits.

6. Describe the proposed operations, including the location and design, of Utilities:

Existing utilities will be utilized or expanded as required. The project will involve trenching in the gravel pad as required for power and communication lines. Electrical cables from the existing electrical skids at the entrance of L Pad will also be trenched into the tundra near the toe of the gravel pad to the gravel pad addition along the southerly edge of L Pad supporting the Titan Turbines skids. At project conclusion, additional flowlines from the new wells to existing infrastructure on L Pad will be added.

7. Describe the proposed operations, including the location and design, of Material Sites:

Existing permitted gravel sources will be utilized. Gravel use will be tracked in compliance with Hilcorp’s Material Sale Contract, ADL #420361. Existing roads and pads will be utilized for access to the Material Site and construction of the gravel extension at L Pad.

8. Describe the proposed operations, including the location and design, of Roads:

The project area is accessible from existing gravel facilities and Hilcorp will use existing roads and pads for the construction of the gravel additions. There is no tundra travel expected for the placement of gravel for the pad additions. If access to tundra is required for snow removal from the proposed footprint, Hilcorp will obtain agency approval prior to initiating activities.

9. Describe the proposed operations, including the location and design, of Airstrips:

N/A

10. Describe the proposed operations, including the location and design, of All Other Facilities and Equipment:

Hilcorp is the operator for all activities associated with MPU production facilities. The scope of the project includes:

• Excavation of gravel from existing permitted sources;

• Placement of gravel on tundra by equipment working from existing gravel pad;

• Spread gravel with equipment working from the existing pad;

• Compact expanded gravel pad;

• Install VSMs and pilings for Turbine Skids, fuel gas metering skid, fuel gas and diesel piping, electrical equipment rooms and switchgear room;

• Install fuel gas metering skid;


• Install diesel piping in existing F to L Pad Water Pipeline pipe rack adding up to 3 VSMs as required;

• Install fuel gas and diesel piping on VSMs on pad;

• Expand electrical skid at the entrance to L Pad, adding up to 6 VSMs;

• Install electrical equipment rooms and switchgear room;

• Install Titan 130 Turbine Skids;

• Trench in gravel pad as required for power and communication lines;

• Trench in tundra for electrical and communication cables from the Electrical Skids at the entrance to L Pad

• Install ancillary equipment as required;

• Drill additional development wells;

• Expand existing infrastructure to tie-in wells to existing production;

• Install additional infrastructure as required to tie-in wells to existing production;

• Tie-in new wells to existing infrastructure;

The project area is accessible from existing gravel facilities and Hilcorp will use existing infrastructure to support this project. Hilcorp will use existing contractor support for the gravel pad additions and infrastructure installations. The Titan 130 Turbine Skids and associated infrastructure will be installed by Titan Delta and Solar Turbines. Anticipated onsite equipment needs for the gravel extension and associated infrastructure may include, but are not limited to excavators, mini excavator, trimmers, rippers, compactors or dozers. Gravel installation and infrastructure installation will be managed by the MPU Field Foremen, Mark O’Malley (907-670-3330).

Hilcorp is the operator for all activities associated with the Milne Point Unit production facilities. Drilling activities will be conducted under the direction of Paul Mazzolini, Hilcorp’s Drilling Manager (907-777-8369). Major equipment components include the following:

• Drill rig and pipe

• Boilers

• Mud tanks and mud pumps

• Rig Generator

• Work trailers for supervisory and support staff

• Light plants

11. If another permit(s) is required for the above described Projected Use Requirements, provide the following information:

Agency Permit Type Permit Number Application Status Projected Use

Requirement(s)

See Appendix C for permit list.

Enter Permit Type. Enter Permit Number. Enter Application Status.

Enter Projected Use Requirement(s).

SECTION VIII: REHABILITATION PLAN

1. Proposed Level of Infrastructure, Facilities and Equipment Removal:

Facility infrastructure will be removed from the Milne Point Unit pads at the time of facility decommissioning.

2. Description of Restoration and Rehabilitation Activities for Vegetation, Habitat, Impacted Wildlife, and Other Applicable Resources:

After the unit is no longer producing, the roads and pads will be cleaned and reclaimed in compliance with applicable laws and regulations.

SECTION IX: OPERATING PROCEDURES DESIGNED TO MINIMIZE ADVERSE EFFECTS

Describe operating procedures designed to prevent or minimize adverse effects on other natural resources and other uses of the Unit area and adjacent areas including:

Fish and Wildlife Habitats: All proposed work will be conducted from existing roads and gravel pads within approximately 143 feet of the toe of L Pad and within 50 feet of L Pad Access Road. No fish bearing streams are impacted. Minimizing the footprint of this extension to an existing pad will minimize the impact to wildlife habitat.

Historic and Archeological Sites: All proposed work will be conducted from existing roads and gravel pads within approximately 143 feet of the toe of L Pad and within 50 feet of the L Pad Road. Encountering previously unknown historical and/or archeological sites is unlikely.

Public Use Areas: There is no public access to the Milne Point Unit. Access is limited and controlled with security checkpoints at the access points to the field. The proposed project does not effect public access to Milne Point Unit.

Other Uses: All employees and contractors will receive Environmental, Health, and Safety (EH&S) training, either provided by Hilcorp or their employer. Topics covered include, but are not limited to, the following: job hazards, safe work practices, drug and alcohol policies, F Pad Site Specific Environmental Awareness, permits and regulations, wildlife interactions, spill prevention and reporting and waste management. In addition to the general EH&S


orientation program, individuals are trained according to job specific requirements, such as construction and equipment operations. Activities at MPU are conducted in compliance with the following plans: Hilcorp’s Oil Discharge Prevention and Contingency Plan for North Slope Facilities (March 2015); Hilcorp’s Storm Water Pollution Prevention Plan (SWPPP)(January 2016); Hilcorp’s Polar Bear and Walrus Interaction and Mitigation Plan (December 2015); and Hilcorp’s Spill Prevention Control and Countermeasures (SPCC) Plan (April 2015).

SECTION X: GLOSSARY OF TERMS

Term # Term Term Definition

1.

2.

3.

4.

5.

SECTION XI: CONFIDENTIALITY

The undersigned hereby requests that each page/section of this application marked confidential be held confidential under AS 38.05.035(a)(8).

APPLICANT CONTACT:

Signature Name Title Date


APPENDIX A: MAPS

Milne Point

Shoal

Tractor Tracks

East UGNUProductionTest Pad

WestSak 17

EquipmentPad

Mine Site E(Ugnu Pit)

MPUM Pad

SimpsonLagoon

MPUN Pad

Milne Point 18-01

TexacoPrudhoe 1

WestSak 25

DS 3K

CFP

DS 3O

MPUD Pad

MPUB Pad

MPUE Pad

MPUA Pad

MPUG Pad

MPUH Pad

MPUS Pad

MPUI Pad

MPUJ Pad

MPUL Pad

MPUF Pad

MPU

Milne Point Road

C Pad

Cabin

MPU Pad-LArea of Detail

U013N009E

U014N011E

U013N011E

U012N009EU012N010E

U013N010E

U014N010EU014N009E

U012N011E

34

252925

5

13

35

15

1

36

41

26

8

34

27

36

27

3

28

32

3

26

9

36

25

11

20

12

29

13

10

24

33

26

2

2323

14

11

17 14

26

22

2

3533

1615

812

21

2

11

2 5

12

34

27

812

31

10

35

28

1 5

11

3234

27

36

24

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35

4

9

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6

31

30

6

30

30

31

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31

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19

18

7

18

77

19

6

30

6

MILNE POINT UNIT

MILNE

POINT UNIT

149°24'0"W149°28'0"W149°32'0"W149°36'0"W149°40'0"W149°44'0"W70

°32'0"

N70

°30'0"

N 70°30

'0"N

70°28

'0"N 70°28

'0"N

70°26

'0"N 70°26

'0"N

Map Date: 10/24/2017

Milne Point UnitMPU PAD-L

Gravel Expansion for Power and Development Wells

Vicinity MapF

0 1 2Miles

0 1 2Kilometers

Alaska StatePlane Zone 4 NAD 1983 (Feet)

LegendExisting Pipeline (Above Ground)Gravel FootprintOil and Gas Unit Boundary

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CanadaAlaska

Nome

Juneau

Utqiagvik (Barrow)

Fairbanks

Anchorage

Project LocationProject Location: Milne Point Unit - L PadLatitude (Decimal Degrees): 70.496717, NAD 1983Longitude (Decimal Degrees): -149.63534, NAD 1983Alaska State Plane Zone 4, NAD 1983 X = 1685008.82Y = 6031280.49Sec. 7-8, T13N, R10E, Umiat MeridianADL#: 025509Adjacent Property Owner: State of Alaska

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143 '

340 '

116 '

41 '

16 '

16 '

110 '

108 '

154 '

200 '

410 '

93 '

30 '30 '

A

A'

B'

B

D

D'

CC'

E'

E

FF

F'

L-01

L-02

L-03

L-06

L-07

L-04

L-08

L-09

L-10

L-12

L-13

L-11

L-17

L-29

L-24

L-16

L-25

L-32

L-33

L-37

L-45

L-49

L-47

L-46L-50

L-48

L-43

L-42

L-28

L-40

L-36

L-20

L-39

L-35

L-34

L-21

L-14

L-15 L-05MPU F-L PAD WI 8

ExistingElectrical Skid

Locations

L-53L-52L-51

L-56L-57

L-54

Additional Development

Wells

Sec.

8Se

c. 7

ADL025509

U013N010E

149°37'55"W149°38'0"W149°38'5"W149°38'10"W149°38'15"W149°38'20"W149°38'25"W70

°29'56

"N

70°29

'56"N

70°29

'54"N

70°29

'54"N

70°29

'52"N

70°29

'52"N

70°29

'50"N

70°29

'50"N

70°29

'48"N

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70°29

'46"N

70°29

'46"N

70°29

'44"N

70°29

'44"N

70°29

'42"N

70°29

'42"N

Map Date: 10/24/2017

Milne Point UnitMPU PAD-L

Gravel Expansion for Power and Development Wells F0 100 200 300

Feet

0 10 20 30 40 50Meters

Alaska StatePlane Zone 4 NAD 1983 (Feet)

Legend

!(Well As-Built Conductor Locations(Bell Survey Oct. 6, 2017)

!( Additonal Development Wells! Surface Hole Locations (Existing)

Pipeline: MPU F-L PAD WI 8Existing Electrical SkidsProposed Pad Working SurfaceProposed Pad Shoulder

1 inch = 167 feet

This figure is conceptual and intendedfor permitting consideration only.Not to be used for engineering.

DATE:October 2017

SCALE:N/A

FIGURE:3

GRAVEL EXPANSION A-A’

ALL DIMENSIONS ARE APPROXIMATE

Not to Scale

TUNDRA

21

EXISTING GRAVEL

16’ 127’

143’

NEW GRAVEL8’

MILNE POINT UNITL PAD

GRAVEL EXPANSION FOR POWERCROSS-SECTIONS

HILCORP ALASKA, LLC

MPU-L_RigGravel_Fig3-XS AA' BB'.ai

GRAVEL EXPANSION B-B’Not to Scale

TUNDRA

21

16’ 16’308’

340’

NEW GRAVEL8’

DATE:October 2017

SCALE:N/A

GRAVEL EXPANSION C-C’


Not to Scale

TUNDRA

21

EXISTING GRAVEL

16’ 30’

46’

NEW GRAVEL8’

MILNE POINT UNIT L PADRIG ACCESS GRAVEL EXPANSION

FOR POWERCROSS-SECTIONS

HILCORP ALASKA, LLC

MPU-L_RigGravel_Fig3-XS AA' BB'

MPU-L_RigGravel_Fig3-XS CC' DD'.ai

GRAVEL EXPANSION D-D’Not to Scale

TUNDRA

21

EXISTING GRAVEL

16’ 100’

116’

NEW GRAVEL8’

FIGURE:

dheebner

Typewriter

4

DATE:October 2017

SCALE:N/A

GRAVEL EXPANSION E-E’


Not to Scale

TUNDRA

21

EXISTING GRAVEL

14’ 93’

107’

NEW GRAVEL7’

MILNE POINT UNITL PAD

GRAVEL EXPANSION FOR POWER AND WELLS CROSS-SECTIONS

HILCORP ALASKA, LLC

MPU-L_RigGravel_Fig3-XS EE' FF'.ai

GRAVEL EXPANSION F-F’Not to Scale

TUNDRA

21

14’ 14’410’

438’

NEW GRAVEL7’

FIGURE:

dheebner

Typewriter

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APPENDIX B: MITIGATION MEASURES

There are no changes proposed to the operations of the Milne Point Unit. All proposed work will be conducted from existing roads and gravel pads within approximately 143 feet of the toe of L Pad and within 50 feet of L Pad Access Road.


APPENDIX C: OTHER

List of project required permits, per Section VII, Item 11:

Agency Permit Type Permit Number Application Status Projected Use Requirement

U.S. Army Corps of Engineers (USACE)

Permit Modification POA-1987-733-M33, Kuparuk River 96

PCN submitted Wetlands fill

ADNR Division of Mining, Land and Water

Temporary Water Use Authorization (TWUA)

Numerous Permits Issued Water use

North Slope Borough (NSB)

Development Permit -- Application submitted Land Use

ADNR Division of Mining, Land and Water

Material Sale Contract ADL #420361 Executed Contract Gravel Use

ADNR Division of Oil and Gas

Unit Plan of Operations/NS(LO/NS) Amendment

LO/NS 83-085 Application submitted Gravel Pad Expansion and drill additional wells

Alaska Department of Environmental Conservation

Minor Permit under 18 AAC 50.502(c)(1) for a new source and 18 AAC 50.508(5) for an Owner Requested Limit.

AQ0200MSS06 Transportable Drill Rig Permit

Permit Issued Air Quality

Alaska Oil and Gas Conservation Commission

Permits to drill and sundry approvals

ADNR Division of Mining, Land and Wate

Land Use Permit LAS #29964 Notification required under existing LAS #29964 if Off Road Travel is required.

If Off Road Travel is required

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Milne Point Unit

L Pad Gravel Additions for Power and Development Wells

Project Description

1.0 INTRODUCTION

Hilcorp Alaska, LLC (Hilcorp) requests approval to add gravel to the existing Milne Point Unit (MPU) L

Pad to install three Titan 130 Turbines skids, fuel gas metering skid, two 1130 barrel Diesel Tanks in

containment for emergency start-ups, piping for diesel and fuel gas supply to the Titans, electrical

equipment rooms and switchgear rooms. Hilcorp is also requesting approval to add gravel to drill up to

five additional development wells at MPU L Pad. The purpose of the proposed activities is the expansion

of oil resource development infrastructure and the increase of production within the MPU.

2.0 PROJECT DESCRIPTION

Hilcorp proposes to install three Titan 130 Turbine skids on a proposed gravel addition along the

southerly edge of L Pad to provide the additional power required for additional facilities including Moose

Pad and additional production wells in the Milne Point Unit. All producing wells in Milne Point Unit

require special equipment or techniques (“artificial lift”) to enhance the flow of oil to the surface. As

“artificial lift”, Milne uses electrical submersible pumps (ESP’s) jet pumps and gas lift to increase rates.

Over 70% of the wells at Milne use ESP’s, which require electrical power, so increasing the number of

producing wells, increases the demand for power. Milne does not have any spare power for adding new

production wells. Less than 1% of the Milne Point Unit is covered with gravel, thanks to technological

advances that have allowed reduction of pad size and reduction in roads from those used in the earlier

days of North Slope Oil production. However, additional space is required for the installation of power

generation facilities at L Pad.

The Titan 130 Turbines will provide this additional power for the western part of the Milne Point Unit.

The Titans 130s are single-shaft gas turbine engines with Solar’s proprietary SoLoNOx dry low emissions

systems to reduce pollution by limiting the formation of nitrous oxides (NOx), carbon monoxide (CO),

and unburned hydrocarbons (UHC). This system uses lean premixed combustion to lower the maximum

flame temperature and reduce pollution formation in the engine exhaust gas.

Hilcorp proposes to install a fuel gas metering skid and piping for diesel and fuel gas supply to the

Turbine skids. Hilcorp proposes to install two 1130 barrel Diesel Tanks in containment on a proposed

southeasterly gravel addition to provide diesel to the turbines during facility shutdowns or when fuel gas

is not available. A diesel supply Line and diesel return line between the diesel tanks and the Titan 130

will be installed in the existing pipe rack for the MPU F to L Pad Water Injection 8” pipeline to the extent

possible. Existing pipe supports will be used to the extent possible, but up to five Vertical Support

Members may be required to add support to the existing pipe rack. The on-pad piping for diesel and fuel

gas supply to the Turbine skids will be placed on VSMs drilled into the gravel pad addition.

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Hilcorp also proposes to install Electrical Equipment Rooms associated with each turbine skid and a

switchgear room. The Titan 130 Turbine Skids, Electrical Equipment Rooms and Switchgear Room will

be placed on pilings. Stairs and ladders will access the skids, landings and rooms. The project will

involve trenching in the gravel pad as required for power and communication lines. Existing electrical

cables from the existing electrical skids at the entrance of L Pad will be relocated and electrical and

communication cables installed in a trench in the tundra between the electrical skid and the toe of the

proposed gravel pad addition along the southerly edge of L Pad supporting the Titan Turbines skids. The

existing electrical skid at the entrance to L Pad shown on Figure 2 will be expanded and up to 6 VSMs

added to support the expanded electrical skid.

Hilcorp seeks approval to add a gravel addition along the northerly edge of L Pad to drill up to five

additional development wells and install associated infrastructure to facilitate production activities at

MPU L Pad. An overview of MPU is provided in Figure 1. Figure 2 shows current facilities and well

locations on L Pad, as well as the approximate surface locations for the proposed wells, related

infrastructure, gravel pad additions and power generation infrastructure. Hilcorp has minimized the

footprint necessary for these additional wells and associated infrastructure; however a pad expansion is

required to accommodate drill rig access to the additional development wells and to provide space for

drill rig movement around the well rows. It is also necessary to provide space for emergency vehicles and

other well servicing equipment to move around the drill rig while the rig is positioned on a well.

Table 1: Location of MPU L Pad

Pad Proposed Work Approximate Pad Center

Location Latitude Longitude

L

1. Add to the gravel pad to install

three Titan 130 Turbine Skids; fuel

gas metering skid, two diesel tanks,

three electrical equipment rooms and

switchgear room.

2. Add to the gravel pad to drill up to

five development wells and install

associated infrastructure

S7 and S8 T13N

R10E 70° 29' 48.183" N 149° 38' 7.225" W

3.0 PROJECT SCHEDULE

Hilcorp proposes to begin place gravel for the additions on March 1, 2018. The compaction and

seasoning of the gravel additions will not be completed until July 2018. The Titan 130 Turbine skids,

fuel gas metering skid, fuel gas and diesel piping, electrical equipment rooms and switchgear room will

be installed in August 2018. Drilling activities are anticipated to begin in July of 2018 and expected to

continue through the end of 2018.

4.0 PERMITS/AUTHORIZATIONS/APPROVALS

The following permits and approvals will be applied for in support of this project:

Department of Army Permit Modification POA-1987-733, Kuparuk River 96; the previous gravel

expansion in 2016 was authorized by POA-1987-733-M33 dated 9/7/2016.

Alaska Department of Natural Resources Unit Plan of Operations/North Slope (LO/NS)

Amendment; The previous L Pad expansion in 2016 was authorized by LO/NS 83-085 dated

6/30/2016.

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North Slope Borough (NSB) Development Permit;

Alaska Department of Environmental Conservation (ADEC) Minor General 1 Air Quality

Control Permit under 18 AAC 50.502(c)(1) for a new source and 18 AAC 50.508(5) for an

Owner Requested Limit;

Alaska Oil and Gas Conservation Commission (AOGCC) permits to drill and sundry approvals;

5.0 SCOPE

The following table summarizes estimated construction footprint and fill quantities to wetlands and

uplands for the proposed pad additions. The proposed pad additions are listed below and shown on the

attached figures:

Project Component Total

Footprint

(acres)

Wetlands

Footprint

(acres)

Uplands

Footprin

t (acres)

Total

Fill (Cu

yds.)

Wetlands

Fill (Cu

yds.)

Uplands

Fill (Cu

yds.)

Southeasterly Addition

for Diesel Tanks and

Containment

0.20 0.20 0 1350 140,000 0

Southerly Addition for

Turbines, Electrical

Rooms and Switchgear

Room

1.14 1.14 0 14500 95,000 0

Northerly Addition for Additional Development Wells

0.95 0.95 0 12,000 12,000 0

VSMs for Diesel Supply

Line and Diesel Return

Line

0.0001 1.0001 0 25 25 0

YSMs for expanded Electric Skid

0.0002 0.0002 0 30 30 0

Totals 2.2903 2.2903 0 27,905 27,905 0

Note: All footprints and gravel quantities are estimated, and represent the most accurate information

available for project planning purposes. Actual footprints and volume quantities may vary slightly based

on local topography, gravel source quality, and compaction, as well as various other environmental and

physical factors present during the extraction and installation of gravel resources.

The surface elevation of the expansion will be level with the existing pad surface elevation.

The scope of the project includes:

Excavation of gravel from existing permitted sources;

Placement of gravel on tundra by equipment working from existing gravel pad;

Spread gravel with equipment working from the existing pad;

Compact expanded gravel pad;

Install VSMs and pilings for Turbine Skids, fuel gas metering skid, fuel gas and diesel piping,

electrical equipment rooms and switchgear room;

Install fuel gas metering skid;

Install diesel piping to existing F to L Pad Water Pipeline pipe rack adding up to 5 VSMs as

required;

Install fuel gas and diesel piping on VSMs on pad;

Expand electrical skid at the entrance to L Pad, adding up to 6 VSMs;

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Install electrical equipment rooms;

Install switchgear room;

Install Titan 130 Turbine Skids;

Trench in gravel pad as required for power and communication lines;

Trench in tundra for electrical and communication cables from the Electrical Skids at the entrance

to L Pad

Install ancillary equipment as required;

Drill additional development wells;

Expand existing infrastructure to tie-in wells to existing production;

Install additional infrastructure as required to tie-in wells to existing production;

Tie-in new wells to existing infrastructure;

The project area is accessible from existing gravel facilities and Hilcorp will use existing infrastructure to

support this project. Hilcorp will use existing contractor support for the gravel pad additions and

infrastructure installations. The Titan 130 Turbine Skids and associated infrastructure will be installed by

Titan Delta and Solar Turbines. Anticipated onsite equipment needs for the gravel expansion and

associated infrastructure may include, but are not limited to, a dozer, compactor, excavator, mini

excavator, super sucker, water truck, heaters, light plants and potentially an Envirovac. Infrastructure

installation will be managed by the Milne Point Unit Field Foreman, Mark O’Malley.

Hilcorp is the operator for all activities associated with the Milne Point Unit production facilities. Drilling

activities will be conducted under the direction of Paul Mazzolini, Hilcorp’s Drilling Manager (907-777-

8369). Major equipment components include the following:

Drill rig and pipe

Boilers

Mud tanks and mud pumps

Rig Generator

Work trailers for supervisory and support staff

Light plants

5.1 Temporary Support Facilities

Drilling will be a 24-hour operation, with personnel housed onsite in a mobile two-story camp.

Due to space constraints on the drill site, some rig support equipment and materials including, but not

limited to, dry mud product, cementing equipment, support vehicles, and rig components may be staged at

nearby pads. Good mud intended for reuse may be temporarily stored in closed top tanks in a lined,

bermed, secondary containment area.

5.2 Gravel Use

Existing Alaska Department of Natural Resources (ADNR) permitted gravel sources will be utilized. All

gravel use will be tracked in compliance with applicable Material Sale Contract, ADL #420361.

5.3 Water Use

Existing ADNR permitted water sources will be utilized. All water use will be tracked in compliance with

applicable water source permits.

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5.4 Waste Management

The project is not expected to generate any significant quantities of waste materials. Any waste material

generated as a result of the pad expansion will be disposed of in an approved manner at existing facilities.

Solid wastes and combustibles will be hauled off-site to the North Slope Borough landfill. Waste will be

handled consistent with Hilcorp waste management practices as outlined below:

Waste will be properly segregated, labeled, and stored to ensure proper disposal.

5.5 Off-Road Travel

An ice pad may be required for drilling the additional development wells. Hilcorp will obtain agency

approval prior to constructing the ice pad at L Pad. If access to tundra is needed for trenching the

electrical cable at the entrance to L Pad and drilling the VSMs for the fuel line, Hilcorp will obtain agency

approval prior to initiating activities.

5.6 Local Hire and Community Relations

Hilcorp employs Arctic Slope Regional Corporation (ASRC) subsidiaries for our Roads and Pads

Maintenance Work and they will do this gravel expansion. In addition, more than 95 percent of Hilcorp’s

workforce is comprised of Alaska residents. Hilcorp works with local organizations to encourage growth

in the local service sector. While not all contracted services are awarded to local/in-state providers,

Hilcorp strives to do business locally whenever possible.

5.7 Environmental, Health, and Safety Training

All employees and contractors receive Environmental, Health, and Safety (EH&S) training, either

provided by Hilcorp or their employer. Topics covered include, but are not limited to, the following:

Job hazards

Safe work practices

Drug and alcohol policies

Permits and regulations

Wildlife interactions

Spill prevention and reporting

Waste management

In addition to the general EH&S orientation program, individuals are trained according to job-specific

requirements, such as drilling operations and construction equipment operations.

5.8 Contingency Plans

Activities, including drilling, at Milne Point Unit are conducted in compliance with the following plans:

Hilcorp’s Oil Discharge Prevention and Contingency Plan for North Slope Facilities (March

2015)

Hilcorp’s Storm Water Pollution Prevention Plan for North Slope Facilities (SWPPP) (January

2016)

Bear Interaction Plan for Hilcorp Alaska, LLC. North Slope Areas of Operation (December

2015)

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5.9 Rehabilitation Plan

Facility infrastructure will be removed from the MPU pads at the time of facility decommissioning. After

the Milne Point Unit is no longer producing, the pads will be cleaned and reclaimed in compliance with

applicable laws and regulations.

6.0 ATTACHMENTS

Figure 1, Milne Point Unit L Pad Expansion Vicinity Map

Figure 2, Milne Point Unit L Pad Expansion Facility Map

Figure 3, Milne Point Unit L Pad Proposed Gravel Expansion Cross-Sections A-A’ and B-B’

Figure 4, Milne Point Unit L Pad Proposed Gravel Expansion Cross-Sections C-C’ and D-D’

Figure 5, Milne Point Unit L Pad Proposed Gravel Expansion Cross Sections E–E’ and F–F’

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