oklahoma ) 671490 order of the commissionimaging.occeweb.com/ap/orders/occ30020227.pdfpooling -...

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BEFORE THE CORPORATION COMMISSION OF THE STATE OF OKLAHOMA APPLICANT: TPR MID-CONTINENT, LLC RELIEF SOUGHT: POOLING LAND COVERED: SECTION 8, TOWNSHIP 10 NORTH, RANGE 8 WEST, GRADY COUNTY, OKLAHOMA ORDER OF THE COMMISSION ) CAUSE .CD NO. ) 201702192-T ) ) ORDER NO. ) ) 671490 This cause came on for hearing before Curtis Johnson, Administrative Law Judge for the Corporation Commission, at 8:30 a.m., on the 29 th day of August, 2017, Eastern Regional Service Office, Tulsa, Oklahoma. Benjamin J. Brown, Attorney, appeared for the Applicant, TPR Mid-Continent, LLC; Robert A. Miller, Attorney, appeared for Marathon Oil Company; and, Eric King, Attorney, appeared for Nosley SCOOP LLC, Nosley Acquisition LLC, and Jones Energy LLC. The Administrative Law Judge heard the cause and filed his report recommending that the Application be granted, which Report and recommendations are adopted by the Commission. The Commission, therefore, finds as follows: FINDINGS 1. That this is the application of TPR Mid-Continent LLC, for an order pooling oil and gas interests, designating the Applicant, or some other party as operator, and adjudicating the rights and equities of oil and gas owners described in the Mississippi Lime, Woodford Shale, and Hunton common sources of supply for the 640-acre drilling and spacing unit consisting of Section 8, Township 10 North, Range 8 West, Grady County, Oklahoma. 2. The Administrative Law Judge conducted an adjudicative inquiry into the sufficiency of the Applicants search for the identity and whereabouts of those respondents whose addresses are unknown for service of process and could not be ascertained with due diligence. Upon an examination of the record and proof of publication, the Administrative Law Judge found the process to be proper. The Commission finds that the Applicant conducted a meaningful search of all reasonably available sources at hand to ascertain the whereabouts of those entitled to notice but who were served solely by publication. Notice has been given as required and the Commission has jurisdiction of the subject matter and the parties. 1

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Page 1: OKLAHOMA ) 671490 ORDER OF THE COMMISSIONimaging.occeweb.com/AP/Orders/occ30020227.pdfPOOLING - CAUSE CD NO. 201702192-T SECTION 8-10N-8W, GRADY COUNTY, OKLAHOMA TPR MID-CONTINENT,

BEFORE THE CORPORATION COMMISSIONOF THE STATE OF OKLAHOMA

APPLICANT: TPR MID-CONTINENT, LLC

RELIEF SOUGHT: POOLING

LAND COVERED: SECTION 8, TOWNSHIP 10 NORTH,RANGE 8 WEST, GRADY COUNTY,OKLAHOMA

ORDER OF THE COMMISSION

) CAUSE .CD NO.) 201702192-T)) ORDER NO.)

) 671490

This cause came on for hearing before Curtis Johnson, Administrative LawJudge for the Corporation Commission, at 8:30 a.m., on the 29th day of August, 2017,Eastern Regional Service Office, Tulsa, Oklahoma.

Benjamin J. Brown, Attorney, appeared for the Applicant, TPR Mid-Continent, LLC;Robert A. Miller, Attorney, appeared for Marathon Oil Company; and, Eric King, Attorney,appeared for Nosley SCOOP LLC, Nosley Acquisition LLC, and Jones Energy LLC.

The Administrative Law Judge heard the cause and filed his report recommendingthat the Application be granted, which Report and recommendations are adopted by theCommission.

The Commission, therefore, finds as follows:

FINDINGS

1. That this is the application of TPR Mid-Continent LLC, for an order poolingoil and gas interests, designating the Applicant, or some other party as operator, andadjudicating the rights and equities of oil and gas owners described in the Mississippi Lime,Woodford Shale, and Hunton common sources of supply for the 640-acre drilling andspacing unit consisting of Section 8, Township 10 North, Range 8 West, Grady County,Oklahoma.

2. The Administrative Law Judge conducted an adjudicative inquiry into thesufficiency of the Applicants search for the identity and whereabouts of those respondentswhose addresses are unknown for service of process and could not be ascertained withdue diligence. Upon an examination of the record and proof of publication, theAdministrative Law Judge found the process to be proper. The Commission finds that theApplicant conducted a meaningful search of all reasonably available sources at hand toascertain the whereabouts of those entitled to notice but who were served solely bypublication. Notice has been given as required and the Commission has jurisdiction of thesubject matter and the parties.

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Page 2: OKLAHOMA ) 671490 ORDER OF THE COMMISSIONimaging.occeweb.com/AP/Orders/occ30020227.pdfPOOLING - CAUSE CD NO. 201702192-T SECTION 8-10N-8W, GRADY COUNTY, OKLAHOMA TPR MID-CONTINENT,

POOLING - CAUSE CD NO. 201702192-TSECTION 8-10N-8W, GRADY COUNTY, OKLAHOMATPR MID-CONTINENT, LLC

3. (a) The Corporation Commission has heretofore, by Order No. 138217,established 640-acre drilling and spacing units for the Mississippi Lime common source ofsupply underlying Section 8, Township 10 North, Range 8 West, Grady County, Oklahoma.

(b) The Corporation Commission has heretofore, by Order No. 560839,established 640-acre drilling and spacing units for the Woodford Shale common source ofsupply underlying Section 8, Township 10 North, Range 8 West, Grady County, Oklahoma.

(c) The Corporation Commission has heretofore, by Order No. 101638,established 640-acre drilling and spacing units for the Hunton common source of supplyunderlying Section 8, Township 10 North, Range 8 West, Grady County, Oklahoma.

4. At the hearing the following Respondents were dismissed:

No. 8 Eula May Johnston Trust, Bank of America,N.A., Trustee

No. 13 Mia Ann Horlbeck, Trustee of the ThreeSisters Royalty Trust

No. 19 PayRock Energy, LLC

5. That the Applicant is the owner of the right to drill into the common sourcesof supply named hereinabove, and has not agreed with all of the parties owning a similarright to develop their interests and the common source of supply named herein as a unit,and the Commission should issue an order requiring such owners to pool and develop thecommon sources of supply named herein as a unit.

6. The Applicant proposes to develop said common sources of supply as a unitand has proposed an initial well therein, and, to avoid the drilling of unnecessary wells andto protect correlative rights, all owners should be required to pool and develop the commonsource of supply named herein, upon the terms and conditions set forth below, within the"Order portion hereof, all of which are found hereby, after consideration of the substantialevidence presented in this cause, to be just and reasonable, and will afford each owner inthe unit the opportunity to recover or receive without unnecessary expense its just and fairshare of the production. The Applicant offered testimony which established that the termsoffered as alternatives to participation were indicative of values associated with acquisitionof rights to drill not only the proposed well, but, also any well drilled subsequent thereto onthe described unit. The Applicants witness stated that it was seeking an order which wouldprovide for relinquishment of both the right to drill subsequent wells, and the workinginterest in such wells, by an owner who elects not to participate in the initial well proposedthereunder.

7. That in the interest of the prevention of waste and the protection of correlativerights, this application should be granted, and the rights of all owners pooled andadjudicated.

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Page 3: OKLAHOMA ) 671490 ORDER OF THE COMMISSIONimaging.occeweb.com/AP/Orders/occ30020227.pdfPOOLING - CAUSE CD NO. 201702192-T SECTION 8-10N-8W, GRADY COUNTY, OKLAHOMA TPR MID-CONTINENT,

POOLING - CAUSE CD NO. 201702192-TSECTION 8-10N-8W, GRADY COUNTY, OKLAHOMATPR MID-CONTINENT, LLC

8. That the Operator is the owner of the right to drill into the common source ofsupply named above, and has furnished the Oklahoma Corporation Commission with aPlugging Agreement and an appropriate Financial Statement, Surety Bond, IrrevocableLetter of Credit, Cash Deposit or Negotiable Instrument, as required by law and the rulesof the Commission.

ORDER

IT IS THEREFORE ORDERED by the Corporation Commission of the State ofOklahoma, as follows:

1. That the Applicant proposes to develop Section 8, Township 10 North, Range8 West, Grady County, Oklahoma, for the 640-acre drilling and spacing units for theMississippi Lime, Woodford Shale, and Hunton common sources of supply, by the drillingof a multiunit horizontal well, or wells thereon, and to develop the common sources ofsupply above as a unit; and the rights and equities of oil and gas owners described onExhibit "A" attached hereto, in the unit and common sources of supply covered hereby arepooled, adjudicated and determined.

2. (a) That estimated well costs for the initial horizontal well proposedhereunder are:

Completed as dry hole - $2,839,375.00Completed for production - $5,714,353.00

(b) That a cash bonus of $4,500.00 per mineral owned by each suchowner, plus a proportionate share of an overriding or excess royalty of 1/16th of 8/8ths isa fair, reasonable, and equitable consideration to be paid unto each owner who elects notto participate in said well by paying such owners proportionate part of the costs thereof.Such cash bonus, plus such owners proportionate share of said overriding or excessroyalty, when paid as set out in this Order, is satisfaction in full for all rights and interestsof such owner, except for any normal 1/8th royalty interest as defined in 52 O.S. Section87.1(e)(1971).

(c) That a cash bonus of $3,500.00 per mineral acre owned by each suchowner, plus a proportionate share of an overriding or excess royalty of 7.5% of 8/8ths onoil and gas is also a fair, reasonable and equitable consideration to be tendered unto eachowner who elects not to participate in said development by paying such owner'sproportionate part of the costs thereof. Such cash bonus, plus owners proportionate shareof said overriding or excess royalty is satisfaction in full for all rights and interests of suchowner, except for any normal 1/8th royalty interest as defined in 52 O.S. Section 87.1(e)(1971).

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Page 4: OKLAHOMA ) 671490 ORDER OF THE COMMISSIONimaging.occeweb.com/AP/Orders/occ30020227.pdfPOOLING - CAUSE CD NO. 201702192-T SECTION 8-10N-8W, GRADY COUNTY, OKLAHOMA TPR MID-CONTINENT,

POOLING - CAUSE CD NO. 201702192-TSECTION 8-10N-8W, GRADY COUNTY, OKLAHOMATPR MID-CONTINENT, LLC

(d) That no cash bonus, but a proportionate share of an overriding orexcess royalty of 1/8th of 8/8ths on oil and gas is also a fair, reasonable and equitableconsideration to be tendered unto each owner who elects not to participate in saiddevelopment by paying such owner's proportionate part of the costs thereof. Such owner'sproportionate share of said overriding or excess royalty is satisfaction in full for all rightsand interests of such owner, except for any normal 1/8th royalty interest, as defined in 52O.S. Section 87.1(e) (1971).

3. That any owner of the right to drill on said drilling and spacing unit who hasnot agreed with the applicant to develop said unit and common source(s) of supply isaccorded the following elections:

a. To participate in the development of the unit and common sources ofsupply by agreeing to pay such owner's proportionate part of the actual cost of thedevelopment of the unit and common sources of supply covered hereby, and as to theinitial well proposed hereunder, by paying, as set out herein, to Applicant such owner'sproportionate part of the estimated completed for production cost thereof, as set out inparagraph 2(a) above, or by securing or furnishing security for such payment satisfactoryto the Applicant. In all events, such owner's cost shall not exceed its proportionate part ofthe actual or the reasonable cost thereof which shall be determined by the Commission inthe event there is a dispute as to such costs. The payment of such owner's proportionatepart of the estimated completed for production cost, or the securing of such costs, or thefurnishing of security therefor, as aforesaid, shall be accomplished within twenty-five (25)days from the date of this order, such owner's proportionate part of the cost of, and of theproduction from any wells drilled hereunder, to be in proportion to the number of acressuch owner has in the unit. As to such participating owner, and the oil and gas interestowned by such owner, the Commission retains continuing jurisdiction hereunder for thepurpose of issuance of orders necessary to facilitate further development of the unit andcommon sources of supply covered hereby.

Given the fact that this Order provides for a one year term within which the initial well is tobe commenced, if an owner subject hereto timely elects to participate in unit developmentunder the terms of this order, such owner shall have the option of deferring its payment ofthe estimated well costs described above. To exercise that option such owner shall, at thetime of its election to participate include an express statement of the desire to deferpayment of such costs. In that event, such owner will not be required to pay to Operatorits share of the estimated completed for production costs identified above for the initial unitwell until Operator provides to such owner a written notice of Operators intention tocommence operations for such initial well. Operator agrees that not more than thirty (30)days prior to commence of operations for such well it will notify such owner in writing ofits intent to commence such well. Such owner will have ten (10) days from its receipt ofsuch notice to pay to Operator its share of such estimated completed for production costs.If such owner fails to timely pay such costs to Operator in the time frame above, suchowner will be deemed to have forfeited its working interest, and, the right to drill associatedtherewith to Operator. In that event, such owner will be deemed to have elected thealternative provided in paragraph 2(b) above. Provided, however, in the event the oil andgas interest of any such owner is subject to any royalty, overriding royalty or otherpayments out of production which create a burden on such interest in excess of the

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Page 5: OKLAHOMA ) 671490 ORDER OF THE COMMISSIONimaging.occeweb.com/AP/Orders/occ30020227.pdfPOOLING - CAUSE CD NO. 201702192-T SECTION 8-10N-8W, GRADY COUNTY, OKLAHOMA TPR MID-CONTINENT,

POOLING - CAUSE CD NO. 201702192-TSECTION 8-10N-8W, GRADY COUNTY, OKLAHOMATPR MID-CONTINENT, LLC

burdens set out in paragraph 2(b) above, the owner of any such interest shall be deemedto have taken the alternative provided in paragraph 2(c) above. Provided, further, in theevent the oil and gas interest of any such owner is subject to any royalty, overriding royaltyor other payments out of production which create a burden on such interest in excess ofthe burdens set out in paragraph 2(c) above, the owner of any such interest shall bedeemed to have taken the alternative provided in paragraph 2(d) above. Provided, in theevent that Operator does not commence operations for such well within sixty (60) daysfrom the date of such notice, Operator will return to such owner any monies paid under theterms of this paragraph. Thereafter, Operator will be required to again provide to suchowner a written notice of Operators intention to commence operations for the initial well.All remaining procedures and requirements of this paragraph will apply to that renewednotice.

b. To receive the cash bonus plus such owners proportionate share ofthe overriding or excess royalty, as set out in paragraph 2(b) above. Such cash bonusshall be paid or tendered, if same can be paid or tendered, within thirty-five (35) days fromthe date of this Order. Any owner electing this alternative shall be deemed to haverelinquished all of its working interest and right to drill in the unit and common source(s) ofsupply covered hereby as to the initial well drilled hereunder and as to any wells drilledsubsequent thereto. The relinquished interest is to be owned by the Applicant, unless byvirtue of agreement among the participating parties such interest is proportionately shared.

c. To receive the cash bonus plus such owners proportionate share ofthe overriding or excess royalty, as set out in paragraph 2(c) above. Such cash bonusshall be paid or tendered, if same can be paid or tendered, within thirty-five (35) days fromthe date of this Order. Any owner electing this alternative shall be deemed to haverelinquished all of its working interest and right to drill in the unit and common source(s) ofsupply covered hereby as to the initial well drilled hereunder and as to any wells drilledsubsequent thereto. The relinquished interest is to be owned by the Applicant, unless byvirtue of agreement among the participating parties such interest is proportionately shared.

d. To receive such owner's proportionate share of the overriding orexcess royalty, as set out in paragraph 2(d) above. Any owner electing this alternativeshall be deemed to have relinquished all of its working interest and right to drill in the unitand common source(s) of supply covered hereby as to the initial well drilled hereunder andas to any wells drilled subsequent thereto. The relinquished interest is to be owned by theApplicant, unless by virtue of agreement among the participating parties such interest isproportionately shared.

PROVIDED, if any payment of bonus due and owing under this Ordercannot be made because the person entitled thereto cannot belocated or is unknown, then said bonus shall be paid into an escrowaccount within ninety (90) days after the date of this Order and shallnot be commingled with any funds of the Applicant or Operator. Anyroyalty payments or other payments due to such person shall be paidinto an escrow account by the holder of such funds. Responsibility forfiling reports with the Commission as required by law and Commissionrule as to bonus, royalty or other payments deposited into escrow

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Page 6: OKLAHOMA ) 671490 ORDER OF THE COMMISSIONimaging.occeweb.com/AP/Orders/occ30020227.pdfPOOLING - CAUSE CD NO. 201702192-T SECTION 8-10N-8W, GRADY COUNTY, OKLAHOMA TPR MID-CONTINENT,

POOLING - CAUSE CD NO. 201702192-TSECTION 8-10N-8W, GRADY COUNTY, OKLAHOMATPR MID-CONTINENT, LLC

accounts shall be with the applicable holder. Such funds depositedin said escrow accounts shall be held for the exclusive use of, andsole benefit of, the person entitled thereto. It shall be theresponsibility of the Operator to notify all other holders of thisprovision and of the Commission rules regarding unclaimed moniesunder pooling orders.

PROVIDED, if any payment of bonus due and owing under this Ordercannot be made for any other reason, including, but not limited to, avalid title dispute raised by an Attorney, then such bonus shall be paidinto an escrow account and shall not be commingled with any fundsof the Applicant or Operator. Any royalty payments or other paymentsdue to such person shall be paid into an escrow account by the holderof such funds.

PROVIDED, however, in the event the oil and gas interest of anyowner is subject to any royalty, overriding royalty or other paymentsout of production which will create a burden on such interests, inexcess of the normal 1/8 royalty defined above, then such excessroyalty, overriding royalty or other payment out of production shouldbe charged against the overriding royalty as hereinabove set forth,and the same should be reduced by the amount of any such excess.

PROVIDED, further, in the event the oil and gas interest of any ownerelecting an alternative to participation in the drilling of a well in the unitis subject to any royalty, overriding royalty or other payments out ofproduction which create a burden on such interest in excess of theburdens set out in paragraph 2(b) or 2(c) above, then such ownershall be limited to the alternatives set out in such paragraphs forwhich that owner can deliver a net revenue interest equal to, or lessthan, that offered by such alternative.

PROVIDED, further, in the event the oil and gas interest of any ownerelecting an alternative to participation in the drilling of a well in the unitis subject to any royalty, overriding royalty or other payments out ofproduction which create a burden on such interest in excess of theburdens set out in paragraph 2(b) above, then such owner shall belimited to the alternatives set out in paragraphs 2(c) or 2(d) above.PROVIDED, however, in the event the oil and gas interest of any suchowner is subject to any royalty, overriding royalty or other paymentsout of production which create a burden on such interest in excess ofthe burdens set out in paragraph 2(c) above, then such owner shallbe limited to the alternative set out in such paragraph 2(d)above.

4. That each owner subject hereto may make any of the elections providedherein as to all or any part of the interest of such owner in the unit and must give notice asto which of the elections stated in paragraph 3(a), 3(b), 3(c), and 3(d) such owner accepts.

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Page 7: OKLAHOMA ) 671490 ORDER OF THE COMMISSIONimaging.occeweb.com/AP/Orders/occ30020227.pdfPOOLING - CAUSE CD NO. 201702192-T SECTION 8-10N-8W, GRADY COUNTY, OKLAHOMA TPR MID-CONTINENT,

POOLING - CAUSE CD NO. 201702192-TSECTION 8-10N-8W, GRADY COUNTY, OKLAHOMATPR MID-CONTINENT, LLC

5. That each owner of the right to drill in said drilling and spacing unit to saidcommon source(s) of supply covered hereby who has not agreed to develop said commonsource(s) of supply as a unit, other than the Applicant, shall elect which of the alternativesset out in paragraph 3 above such owner accepts. Said election is to be made to theApplicant and Operator, in writing, within twenty (20) days from the date of this Order. Inthe event any such owner fails to elect within the time and in the manner as set out abovewhich of the alternatives set forth in paragraph 3 above any such owner accepts, then suchowner is deemed to have elected the alternative provided in paragraph 2(b) hereinabove.PROVIDED, however, in the event the oil and gas interest of any such owner is subject toany royalty, overriding royalty or other payments out of production which create a burdenon such interest in excess of the burdens set out in paragraph 2(b) above, the owner of anysuch interest shall be deemed to have taken the alternative provided in paragraph 2(c)above. PROVIDED, further, in the event the oil and gas interest of any such owner issubject to any royalty, overriding royalty or other payments out of production which createa burden on such interest in excess of the burdens set out in paragraph 2(c) above, theowner of any such interest shall be deemed to have taken the alternative provided inparagraph 2(d) above. In the event any owner elects to do other than participate in theinitial well drilled hereunder by paying its proportionate share of the costs thereof, or failsto make any election provided above, such owner shall be deemed to have relinquishedunto Applicant all of such owners right, title, interest, or claim in such well, and any welldrilled subsequent thereto, except for any normal 1/8th royalty interest, defined above, orother share in production to which such owner may be entitled by reason of any electionhereunder.

6. If the Applicant proposes to drill a well, or conduct an operation, subsequentto the initial well drilled hereunder into the common source of supply named in Paragraph1 above, it shall mail a written proposal of that operation to each owner subject hereto whoparticipated in the cost and expense of drilling said initial well. That proposal shall specifythe location, estimated cost and estimated total depth of the proposed subsequentoperation. The owners to whom such proposal is mailed shall have twenty (20) days fromtheir receipt of that proposal within which to elect in writing to the Operator whether theyelect to participate in the cost of such subsequent operation; or, in the alternative, to electone of the alternatives to participation set out in 2(b), (c), and (d) above.

An owner electing to participate in the proposed subsequent operation shallpay to the Operator its share of completed for production costs within five (5) daysfollowing expiration of the twenty (20) day election period provided in the precedingparagraph.

If an owner fails to make a written election in response to the proposal of thesubsequent operation; or, after electing to participate, fails to pay the Operator its shareof completed for production costs within the five (5) day period provided above, such ownershall be deemed to have taken the alternative provided in Paragraph 2(b) above.PROVIDED, however, in the event the oil and gas interest of any such owner is subject toany royalty, overriding royalty or other payments out of production which create a burdenon such interest in excess of the burdens set out in paragraph 2(b) above, the owner of anysuch interest shall be deemed to have taken the alternative provided in paragraph 2(c)above. PROVIDED, further, in the event the oil and gas interest of any such owner is

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Page 8: OKLAHOMA ) 671490 ORDER OF THE COMMISSIONimaging.occeweb.com/AP/Orders/occ30020227.pdfPOOLING - CAUSE CD NO. 201702192-T SECTION 8-10N-8W, GRADY COUNTY, OKLAHOMA TPR MID-CONTINENT,

POOLING - CAUSE CD NO. 201702192-TSECTION 8-10N-8W, GRADY COUNTY, OKLAHOMATPR MID-CONTINENT, LLC

subject to any royalty, overriding royaity or other payments out of production which createa burden on such interest in excess of the burdens set out in paragraph 2(c) above, theowner of any such interest shall be deemed to have taken the alternative provided inparagraph 2(d) above.

An owner who elects not to participate in the cost and expense of theproposed subsequent operation, or who is deemed not to participate, shall relinquish allof its working interest and right to drill in the unit and common sources of supply coveredhereby as to the proposed subsequent operation and as to any operations performed orwells drilled subsequent thereto. The relinquished interest is to be owned by the Applicant,unless by virtue of agreement among the participating parties such interest isproportionately shared.

The proposed subsequent operation shall be commenced within 180 daysfrom the date of the written proposal of that operation, and shall be diligently prosecutedto completion. lf said operation is not commenced within the 180-day period, the rightsrelinquished by owners under this paragraph 6 as a result of said proposal shall berevested in those owners.

A "subsequent well" shall not include or cover any sidetrack operation in theinitial unit well or any subsequent well covered hereby when said sidetrack operation isconducted only to straighten the hole or to drill around junk in the hole or to overcome othermechanical difficulties. No parties shall have the right to make any subsequent electionsas to any such sidetrack operation described in the preceding sentence. A sidetrackoperation, however, for any other reason shall be considered a "subsequent well" and shallfall within the terms set forth herein; provided however, that an election not to participatein such a sidetrack operation will constitute a relinquishment of a non-consenting party'sparticipation rights in the wellbore only of the sidetrack well, notwithstanding anythingprovided to the contrary in this subsequent operations provision.

For purposes of this paragraph 6, any owner who participates in the risk andexpense of a well drilled under this order shall notify the Operator of any assignment ortransfer of its interest in the drilling and spacing unit. The Operator shall then be obligatedto mail the written proposal described above to that assignee, or transferee.

The term "subsequent well" or "subsequent operation" for purposes of thisparagraph shall not include any side-tracking or other operation with respect to the initialor any subsequent well, and shall not include any well that is drilled as a replacement orsubstitute well for the initial or any subsequent well covered hereby, by virtue of anymechanical or other problems arising directly in connection with the drilling, completing,equipping or producing of any such well, and no party subject to this Order shall have theright to make any subsequent elections as to any such side-tracking, replacement well, orsubstitute well.

7. That Operator, in addition to any other rights provided herein, shall have alien, as set out in 52 0.S., Section 87.1(e)(1971), on the interest of any owner subject tothis Order, who has elected to participate in the initial well proposed to be drilled hereunderby paying such owner's proportionate part of the costs thereof. Provided, however, that

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Page 9: OKLAHOMA ) 671490 ORDER OF THE COMMISSIONimaging.occeweb.com/AP/Orders/occ30020227.pdfPOOLING - CAUSE CD NO. 201702192-T SECTION 8-10N-8W, GRADY COUNTY, OKLAHOMA TPR MID-CONTINENT,

POOLING - CAUSE CD NO. 201702192-TSECTION 8-10N-8W, GRADY COUNTY, OKLAHOMATPR MID-CONTINENT, LLC

in the event any owner elects to participate in said well by paying his proportionate part ofthe costs and fails or refuses to pay or to secure the payment of such ownersproportionate part of the completed for production cost as set out in paragraph 2(a) above,or fails or refuses to pay or make any arrangements satisfactory to the Operator for thepayment thereof, all within the periods of time as prescribed in this order, then such owneris deemed to have taken the alternative provided in paragraph 2(b) above. PROVIDED,however, in the event the oil and gas interest of any such owner is subject to any royalty,overriding royalty or other payments out of production which create a burden on suchinterest in excess of the burdens set out in paragraph 2(b) above, the owner of any suchinterest shall be deemed to have taken the alternative provided in paragraph 2(c) above.PROVIDED, further, in the event the oil and gas interest of any such owner is subject toany royalty, overriding royalty or other payments out of production which create a burdenon such interest in excess of the burdens set out in paragraph 2(c) above, the owner of anysuch interest shall be deemed to have taken the alternative provided in paragraph 2(d)above. Such owner shall be deemed to have relinquished unto the Applicant all of suchowners right, title, interest, or claim in such well and in any well drilled subsequent thereto,except for any normal 1/8th royalty interest, defined above, or other share in production towhich such owner may be entitled by reason of an election hereunder. Thereupon, and ifApplicant is required to make a payment of cash bonus under the terms of paragraphs 2(b)or 2(c) such payment shall be made by Applicant within thirty (30) days after the last dayof which such defaulting owner, under this Order, should have paid its proportionate partof such costs or should have made satisfactory arrangements for the payment thereof.

8. In the event any owner elects to participate in a unit well by paying itsproportionate part of the costs and fails or refuses to pay or to secure the payment of suchowners proportionate part of the completed for production cost as set out in paragraph 2(a)above; or, fails or refuses to pay or make any arrangements satisfactory to the Applicantfor the payment thereof, all within the periods of time as prescribed in this order, then suchowner is deemed to have taken the alternative provided in paragraph 2(b) above.PROVIDED, however, in the event the oil and gas interest of any such owner is subject toany royalty, overriding royalty or other payments out of production which create a burdenon such interest in excess of the burdens set out in paragraph 2(b) above, the owner of anysuch interest shall be deemed to have taken the alternative provided in paragraph 2(c)above. PROVIDED, further, in the event the oil and gas interest of any such owner issubject to any royalty, overriding royalty or other payments out of production which createa burden on such interest in excess of the burdens set out in paragraph 2(c) above, theowner of any such interest shall be deemed to have taken the alternative provided inparagraph 2(d) above. Such owner shall be deemed to have relinquished unto Applicantall of such owners right, title, interest, or claim in such well and in any well drilledsubsequent thereto, except for any normal 1/8th royalty interest, defined above, or othershare in production to which such owner may be entitled by reason of an electionhereunder. Thereupon, and if the Applicant is required to make a payment of cash bonusunder the terms of paragraphs 2(b) or 2(c) such payment shall be made by the Applicantwithin thirty-five (35) days after the last day of which such defaulting owner, under thisOrder, should have paid its proportionate part of such costs or should have madesatisfactory arrangements for the payment thereof.

9. That:

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Page 10: OKLAHOMA ) 671490 ORDER OF THE COMMISSIONimaging.occeweb.com/AP/Orders/occ30020227.pdfPOOLING - CAUSE CD NO. 201702192-T SECTION 8-10N-8W, GRADY COUNTY, OKLAHOMA TPR MID-CONTINENT,

POOLING - CAUSE CD NO. 201702192-TSECTION 8-10N-8W, GRADY COUNTY, OKLAHOMATPR MID-CONTINENT, LLCTravis Peak Resources, LLC

9020 North Capital of Texas HighwayBuilding 1, Suite 170Austin, TX 78759(512) 814-0345

is designated as Operator of the unit, and common source of supply named herein and thewell, or wells, drilled hereunder. All elections must be communicated to Operator at theaddress above as required in this Order. Operator shall be required to pay all bonuseswhich may become due and payable under the terms of this Order.

10. The payment of cash bonus and royalty hereunder is subject to Operatorsreceipt of a fully completed and executed Internal Revenue Service Form W-9 by theapplicable respondent.

11. That the Operator must commence operations for the drilling of the initial wellproposed hereunder, or other operations with respect to said well covered hereby withinone year from the date of this Order, and diligently prosecute the same to completion ina reasonably prudent manner, or this Order shall be of no force and effect, except as tothe payment of bonuses hereunder.

12. That the Applicant or its attorney shall file with the Secretary of theCommission, within ten (10) days from the date of this order, an Affidavit stating that acopy of said Order was mailed within three (3) days from the date of this Order to all partiespooled by this order, whose addresses are known.

DONE AND PERFORMED THIS

DER. OF THE COMMISSION:

PEGbY

ORATIO(N4T I SION • F OKLAHOMA

ail/tit •

DANA L. MURPHY, Chairman

a-74-4L.J. T DD , Vice Chairman

klO AAA-BOB ANTHONY, CoMris loner

DAY OF

ecretary of the Commission

, 2017.

1 0

Page 11: OKLAHOMA ) 671490 ORDER OF THE COMMISSIONimaging.occeweb.com/AP/Orders/occ30020227.pdfPOOLING - CAUSE CD NO. 201702192-T SECTION 8-10N-8W, GRADY COUNTY, OKLAHOMA TPR MID-CONTINENT,

POOLING - CAUSE CD NO. 201702192-TSECTION 8-10N-8W, GRADY COUNTY, OKLAHOMATPR MID-CONTINENT, LLC

APPROVED AS TO CONTENT AND FORM:

REPORT OF THE ADMINISTRATIVE LAW JUDGE

The foregoing findings and order are the report and recommendations of theAdministrative Law Judge.

urtis Jo nson,Admi str ive Law Judge

mai Revie`A_

11

Date

Date / (

Page 12: OKLAHOMA ) 671490 ORDER OF THE COMMISSIONimaging.occeweb.com/AP/Orders/occ30020227.pdfPOOLING - CAUSE CD NO. 201702192-T SECTION 8-10N-8W, GRADY COUNTY, OKLAHOMA TPR MID-CONTINENT,

POOLING - CAUSE CD NO. 201702192-TSECTION 8-10N-8W, GRADY COUNTY, OKLAHOMATPR MID-CONTINENT, LLC

Order:

EXHIBIT "A"

Listed below are all owners of oil and gas interests subject to this Pooling

1. 89 Energy, LLC105 North Hudson Ave, Suite 650Oklahoma City, OK 73104

2. American Mineral Partners LLCP.O. Box 13647Oklahoma City, OK 73113

3. BAHA Resources, LLC6701 North Broadway, Suite 310Oklahoma City, OK 73071

4. Bobby H. Anglinc/o AFI Royalty, LLCP.O. Box 794548Dallas, TX 75379-1548

5. Chisholm Oil, LLC12101 N. MacArthur BLVD, Suite A#303Oklahoma City, OK 73162

6. Cimarex Energy Company202 S Cheyenne Ave, Suite 1000Tulsa, OK 74103

7. Citizen Energy II LLC320 S. Boston Avenue, Ste. 1300Tulsa, OK 74103

8. Dismissed

9. Gulfstar Royalty Company, LLCP.O. Box 14693Oklahoma City, OK 73116

10. Joumey Oil & Gas LLCP.O. Box 2647Edmond, OK 73083

11. MAP2009-OK, an Oklahoma generalpartnership,c/o MAP Royalty, Inc.101 N. Robinson, Suite 1000Oklahoma City, OK 73102-5514

12. Marathon Oil Company7301 N.W. Expressway, Suite 225Oklahoma City, OK 73132

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13. Dismissed

14. Mid-Continent Land Services, LLC10201 Buffalo Ridge RdEdmond, OK 73025

15. Monticello Investments LLC6608 North Western Ave, Suite 438Oklahoma City, OK 73116

16. Needham Energy Land Services, LLC111 N Harrison Ave Ste. LL-011Oklahoma City, OK 73104

17. Nosley SCOOP, LLCNosley Acquisition, LLC, &Jones Energy, LLC807 Las Cimas Parkway,Austin, TX 78746

18. Orville Curtis Rogersc/o Melanie Rogers3840 W Bay CIRDallas, TX 75214

19. Dismissed

20. Petram Resources, L.P.507 Woodland Park Dr.Marble Falls, TX 78654

Suite 350

21. Rex Brown, AKA Rector Brown,AKA W. Rex Brown, presumeddeceasedc/o Matteo Giammario600 Mulberry CirNew Hope, PA 18938bad address; address unknown

22. Rex Brown, presumed deceasedc/o The Choctaw Nation of OklahomaPO Box 1210Durant, OK 74702-1210

23. Rojo Energy Holdings, LLCP.O. Box 803352Dallas, TX 75380-3352

Page 13: OKLAHOMA ) 671490 ORDER OF THE COMMISSIONimaging.occeweb.com/AP/Orders/occ30020227.pdfPOOLING - CAUSE CD NO. 201702192-T SECTION 8-10N-8W, GRADY COUNTY, OKLAHOMA TPR MID-CONTINENT,

POOLING - CAUSE CD NO. 201702192-TSECTION 8-10N-8W, GRADY COUNTY, OKLAHOMATPR MID-CONTINENT, LLC

24. SCOOP Energy Company LLC, anOklahoma LLCP.O. Box 18545Oklahoma City, OK 73102

25. Veva Jean GibbardPO Box 436Sulphur, OK 73086

26. W.A. Crisp, presumed deceased3023 NW 22nd StreetOklahoma City, OK 73107bad address; address unknown

27. W.A. Crisp, presumed deceasedc/o Catherine Bly4444 Plymouth Springmill RdShelby, OH 44875

28. W.A. Crisp, presumed deceasedc/o Willice Albert Crisp, III6101 W Whispering Wind DRGlen Dale, AZ 85310

29. Warwick-Jupiter, LLC6608 N. Western Ave., Box 417Oklahoma City, OK 73116

FOR ADMINISTRATIVE PURPOSES ONLY:

30. Paladin Land GroupATTN: J.M. BradshawP.O. Box 52400Tulsa, OK 74152

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