Common use of Introduction and Background Clause in Contracts

Introduction and Background. On June 1, 2001, AVCG LLC (AVCG) filed the Sakonowyak River Unit application (Application) with the Division of Oil and Gas (Division) on behalf of BP Exploration (Alaska) Inc. (BPXA), the designated unit operator. The proposed unit is located in Gwydyr Bay Alaska, at the mouth of the Sakonowyak River, south of the Northstar Unit and north of the Prudhoe Bay Unit. The proposed unit area covers approximately 11,520 acres within five individual State of Alaska oil and gas leases. AVCG submitted the Application for approval by the State of Alaska, Department of Natural Resources (DNR). Approval of the proposed Unit Agreement (Agreement) would conform and modify the lease contracts to be consistent with the Agreement. Four of the leases in the proposed unit area were offered in State of Alaska Lease Sale 80, held on December 5, 1995. DNR issued oil and gas leases ADL 385198, ADL 385199, ADL 385201, and ADL 375202, effective February 1, 1996, on State of Alaska lease form number DOG 9208. The seven-year primary lease term of these leases expires on January 31, 2003. The remaining lease in the proposed unit area was offered in State of Alaska Lease Sale 65, held on June 4, 1991. DNR issued ADL 377051, effective August 1, 1991, on State of Alaska lease form number DNR 10-4037 (Revised September, 1990), which provides for a ten-year primary term. Without unitization, lease ADL 377051 expires July 31, 2001. BPXA initially purchased the four Sale 80 leases, and then assigned 25% of the working interest in each to Arco (Alaska), Inc. (AAI). AAI changed its name to ▇▇▇▇▇▇▇▇ (Alaska), Inc. (PAI) effective April 27, 2000. Earlier this year, PAI assigned its 25% working interest in the leases to AVCG. ADL 377051 was originally issued to AAI in Sale 65. Less than a year al ter, AAI assigned ▇▇▇▇▇▇▇▇ Petroleum Company and Texaco Exploration Alaska each a one-third working interest in the lease. ▇▇▇ later assigned an 81/3% working interest ownership in the lease to Exxon Corporation, thus retaining a 25% working interest. In December 2000, Texaco Exploration Alaska assigned its working interest to ▇▇▇▇▇▇▇▇ Petroleum Company, which became the property of PAI following the BP-ARCO merger. Earlier this year, Exxon Corporation agreed to assign its working interest in the lease to AVCG, and ▇▇▇▇▇▇▇▇ Petroleum Company has agreed to do the same for its working interest in the proposed unit. Upon approval of these pending assignments, BPXA and AVCG will have 62% and 38% effective working interests in the unit area, respectively. The Agreement, if approved, will extend the term of the leases for as long as they are subject to the Agreement. 11 AAC 83.190.

Introduction and Background. On June 1August 31, 20012005, AVCG LLC Pioneer Natural Resources Alaska, Inc. (AVCG) Pioneer), as the designated NE Storms unit operator, filed the Sakonowyak River NE Storms Unit application (Application) with the Division of Oil and Gas (Division) on behalf of BP Exploration (Alaska) Inc. (BPXA), the designated unit operator. The proposed unit is located in Gwydyr Bay Alaska, at the mouth of the Sakonowyak River, south of the Northstar Unit and north of the Prudhoe Bay Unit. The proposed unit area covers approximately 11,520 acres within five individual State of Alaska oil and gas leases. AVCG submitted the Application for approval by the State of Alaska, Department of Natural Resources (DNR), on behalf of itself and the other majority working interest owner (WIO), ConocoPhillips Alaska, Inc. (ConocoPhillips). The proposed unit is located on the North Slope, approximately 1-2 miles southwest of the Prudhoe Bay Unit (PBU). The proposed unit area covers approximately 16,456 acres within seven individual State of Alaska oil and gas leases. Approval of the proposed NE Storms Unit Agreement (Agreement) would conform and modify the lease contracts to be consistent with the Agreement, and extend the term of leases for as long as they are subject to the Agreement. Four Five of the leases in the proposed unit area were offered in the North Slope Areawide 2003 Oil and Gas Lease Sale, held on October 29, 2003. DNR issued oil and gas leases ADL 390472 (Tract 1), ADL 390473 (Tract 2), ADL 390492 (Tract 5), ADL 390497 (Tract 6), and ADL 390496 (Tract 7), effective May 1, 2004, on State of Alaska lease form number DOG 200204 (rev. 10/2003), which reserves a 16.66667 percent royalty to the State of Alaska. The seven-year primary lease term of these leases expires on April 30, 2011. The remaining two leases in the proposed unit area were offered in State of Alaska Lease Sale 8087, held on December 5June 24, 19951998. DNR issued oil and gas leases ADL 385198, ADL 385199, ADL 385201, 389096 (Tract 4) and ADL 375202389097 (Tract 3), effective February November 1, 19961998, on State of Alaska lease form number DOG 92089609 (rev. 6/97), which reserves a 12.50 percent royalty to the State of Alaska. The seven-year primary lease term of these leases expires on January October 31, 2003. The remaining lease in the proposed unit area was offered in State of Alaska Lease Sale 65, held on June 4, 1991. DNR issued ADL 377051, effective August 1, 1991, on State of Alaska lease form number DNR 10-4037 (Revised September, 1990), which provides for a ten-year primary term. Without unitization, lease ADL 377051 expires July 31, 2001. BPXA initially purchased the four Sale 80 leases, and then assigned 25% of the working interest in each to Arco (Alaska), Inc. (AAI). AAI changed its name to ▇▇▇▇▇▇▇▇ (Alaska), Inc. (PAI) effective April 27, 2000. Earlier this year, PAI assigned its 25% working interest in the leases to AVCG. ADL 377051 was originally issued to AAI in Sale 65. Less than a year al ter, AAI assigned ▇▇▇▇▇▇▇▇ Petroleum Company and Texaco Exploration Alaska each a one-third working interest in the lease. ▇▇▇ later assigned an 81/3% working interest ownership in the lease to Exxon Corporation, thus retaining a 25% working interest. In December 2000, Texaco Exploration Alaska assigned its working interest to ▇▇▇▇▇▇▇▇ Petroleum Company, which became the property of PAI following the BP-ARCO merger. Earlier this year, Exxon Corporation agreed to assign its working interest in the lease to AVCG, and ▇▇▇▇▇▇▇▇ Petroleum Company has agreed to do the same for its working interest in the proposed unit. Upon approval of these pending assignments, BPXA and AVCG will have 62% and 38% effective working interests in the unit area, respectively. The Agreement, if approved, will extend the term of the leases for as long as they are subject to the Agreement. 11 AAC 83.1902005.

Introduction and Background. On June 1February 15, 2001, AVCG LLC (AVCG) filed the Sakonowyak River Unit application (Application) with the Division of Oil and Gas (Division) on behalf of BP Exploration (Alaska) Inc. (BPXA“BP”) on behalf of itself, Chevron U.S.A. Inc. (“Chevron”), and ▇▇▇▇▇▇▇▇ Alaska Inc. (“PAI”) as the designated unit operatorworking interest owners in the proposed Slugger Unit applied for approval of the proposed Slugger Unit Agreement (“Agreement”). The proposed unit Slugger Unit is located in Gwydyr Bay on the North Slope of Alaska, at the mouth east of the Sakonowyak River, south confluence of the Northstar Unit Kavik and north Shaviovik Rivers, and southwest of the Prudhoe Bay Pt. Thomson Unit. The proposed unit area covers approximately 11,520 79,508 acres within five fourteen individual State of Alaska oil and gas leases. AVCG BP submitted the Application Slugger Unit application for approval by the t he State of Alaska, Department of Natural Resources (“DNR”). Approval Appr oval of the proposed Unit t he Agreement (Agreement) would conform and modify the lease contracts to be consistent with contracts. Eight of the Agreementleases in the proposed unit area were offered in State of Alaska Lease Sale 70A, held on January 29, 1991. Four DNR issued oil and gas leases ADL 375033, ADL 375034, ADL 375036, ADL 375052, ADL 375053, ADL 375054, ADL 375055, and ADL 375059 effective April 1, 1991, on State of Alaska lease form number DNR 10-4037 (revised 9/90). The ten-year primary lease term of these eight leases expires on March 31, 2001. Two of the leases in the proposed unit area were offered in State of Alaska Lease Sale 70-AW, held on May 25, 1993. DNR issued ADL 382035 and ADL 382056 effective August 1, 1993, on State of Alaska lease form number DOG 9208, which provides for a ten-year primary term. Three of the leases in the proposed unit area were offered in State of Alaska Lease Sale 80, held on December 5, 1995. DNR issued oil and gas leases ADL 385198385126, ADL 385199, ADL 385201385129, and ADL 375202, 385144 effective February 1, 1996, on State of Alaska lease form number DOG 9208. The , which provides for a seven-year primary lease term of these leases expires on January 31, 2003term. The remaining final lease in the proposed unit area was offered in State of Alaska Areawide NS 2000 Lease Sale 65Sale, held on June 4November 15, 19912000. DNR This lease, ADL 389656, has yet to be issued, but if issued ADL 377051, effective August 1, 1991, it will be on State of Alaska lease form number DNR 10-4037 (Revised September, 1990)DOG 9609, which provides for carries a tenprimary term of seven-year primary termyears. Without unitizationAll fourteen leases retain a 12.5 percent royalty to the State of Alaska. Arco (Alaska) Inc., lease ADL 377051 expires July 31BP, 2001Chevron, and Amerada ▇▇▇▇ Corporation all had initial ownership in the leases. BPXA initially purchased Amerada ▇▇▇▇ Corporation sold all of its working interest in the four Sale 80 leases between 1994 and 1999, and Arco (Alaska) Inc. changed its name to PAI effective April 27, 2000. Ownership varies between the individual leases, but on average BP, the proposed unit operator owns 42%; Chevron owns 33%; and then assigned PAI owns 25% of the working interest in each to Arco (Alaska), Inc. (AAI). AAI changed its name to ▇▇▇▇▇▇▇▇ (Alaska), Inc. (PAI) effective April 27, 2000. Earlier this year, PAI assigned its 25% working interest in the leases to AVCG. ADL 377051 was originally issued to AAI in Sale 65. Less than a year al ter, AAI assigned ▇▇▇▇▇▇▇▇ Petroleum Company and Texaco Exploration Alaska each a one-third working interest in the lease. ▇▇▇ later assigned an 81/3% working interest ownership in the lease to Exxon Corporation, thus retaining a 25% working interest. In December 2000, Texaco Exploration Alaska assigned its working interest to ▇▇▇▇▇▇▇▇ Petroleum Company, which became the property of PAI following the BP-ARCO merger. Earlier this year, Exxon Corporation agreed to assign its working interest in the lease to AVCG, and ▇▇▇▇▇▇▇▇ Petroleum Company has agreed to do the same for its working interest in the proposed unit. Upon approval of these pending assignments, BPXA and AVCG will have 62% and 38% effective working interests in the unit area, respectively. The Agreement, if approved, will extend the term of the leases for as long as they are subject to the Agreement. 11 AAC 83.190.

Introduction and Background. On June 1May 9, 20012000, AVCG LLC ▇▇▇▇▇▇▇▇ Alaska, Inc. (AVCG“▇▇▇▇▇▇▇▇”) filed the Sakonowyak River Unit application (Application) with the Division of Oil and Gas (Division) applied on behalf of BP Exploration (Alaska) itself and Chevron U.S.A. Inc. (BPXAChevron), for approval of the designated unit operatorproposed McCovey Unit Agreement (“Agreement”). The proposed unit McCovey Unit is located in Gwydyr Bay Alaskathe Beaufort Sea, at the mouth of the Sakonowyak River, south of the Northstar Unit and north of the Prudhoe Bay UnitUnit and west of Cross Island. The proposed unit area covers approximately 11,520 acres within five 28,504 acres. ▇▇▇▇▇▇▇▇ proposed unitizing seven individual oil and gas leases including four State of Alaska oil leases and gas three Federal Outer Continental Shelf leases. AVCG ▇▇▇▇▇▇▇▇ submitted the Application McCovey Unit application for approval by the State of Alaska, Department of Natural Resources (“DNR”) and the U.S. Department of the Interior, Minerals Management Service (“MMS”). Approval of the proposed Unit Agreement (Agreement) would conform and modify the lease contracts to be consistent with the Agreementcontracts. Four of the The state leases in the proposed unit area were offered in State of Alaska Lease Sale 80, held on December 5, 1995. DNR issued oil and gas leases ADL 385198, ADL 385199, ADL 385201, and ADL 375202, effective February 1, 1996, on State of Alaska lease form number DOG 9208. The seven-year primary lease term of these leases expires on January 31, 2003. The remaining lease in the proposed unit area was offered in State of Alaska Lease Sale 65, held on June 4, 1991. DNR issued oil and gas leases ADL 377051377055, ADL 3777056, ADL 377059, and ADL 377066 effective August 1, 1991, . The leases are on State of Alaska lease form number DNR 10-4037 (Revised September, 1990), revised 9/90) which provides for a ten-16.66667% royalty share to the state. The ten- year primary term. Without unitization, lease ADL 377051 expires terms expire on July 31, 2001. BPXA initially purchased the four Sale 80 leases, and then assigned 25% of the working interest in each to Arco (Alaska), Inc. (AAI). AAI changed its name to ▇▇▇▇▇▇▇▇ (Alaska), Inc. (PAI) effective April 27, 2000. Earlier this year, PAI assigned its 25% working interest in the leases to AVCG. ADL 377051 was originally issued to AAI in Sale 65. Less than a year al ter, AAI assigned ▇▇▇▇▇▇▇▇ Petroleum Company and Texaco Exploration Alaska each a one-third working interest in the lease. ▇▇▇ later assigned an 81/3% working interest ownership in the lease to Exxon Corporation, thus retaining a 25% working interest. In December 2000, Texaco Exploration Alaska assigned its working interest to ▇▇▇▇▇▇▇▇ Petroleum Company, which became the property of PAI following the BP-ARCO merger. Earlier this year, Exxon Corporation agreed to assign its working interest in the lease to AVCG, and ▇▇▇▇▇▇▇▇ Petroleum Company has agreed to do the same for its working interest in the proposed unit. Upon approval of these pending assignments, BPXA and AVCG will have 62% and 38% effective working interests in the unit area, respectively. The Agreement, if approved, will extend the term of the state leases for as long as they are subject to the Agreement. 11 AAC 83.190.. MMS offered the three federal leases in the proposed unit area in Federal OCS Sale Number 124 held on June 4, 1991. MMS issued federal leases OCS-Y-1576, OCS-Y-1577 and OCS-Y-1578 on form number MMS-2005 (revised March 1986) which provides for a 12.5% royalty share to the federal government. The federal leases have an effective date of August 1, 1991 and a ten- year primary term. MMS will review the unit application and issue a separate decision. ▇▇▇▇▇▇▇▇ is the proposed unit operator and holds the leases jointly with Chevron. Each company holds 50% working interest in the proposed unit area. Chevron held 100% interest in the state leases until November 1, 1998, when it transferred half of its working interest to Arco Alaska, Inc. Effective April 27, 2000, Arco Alaska, Inc. changed its name to ▇▇▇▇▇▇▇▇ Alaska, Inc.

Introduction and Background. On June 1October 5, 20012005, AVCG LLC ▇▇▇▇▇▇ Range Petroleum Corporation (AVCG) ▇▇▇▇▇▇ Range), as the designated Whiskey Gulch Unit Operator, filed the Sakonowyak River Whiskey Gulch Unit application (Application) with the Division of Oil and Gas (Division) on behalf of BP Exploration (Alaska) Inc. (BPXA), the designated unit operator. The proposed unit is located in Gwydyr Bay Alaska, at the mouth of the Sakonowyak River, south of the Northstar Unit and north of the Prudhoe Bay Unit. The proposed unit area covers approximately 11,520 acres within five individual State of Alaska oil and gas leases. AVCG submitted the Application for approval by the State of Alaska, Department of Natural Resources (DNR), on behalf of itself as the sole working interest owner (WIO). The proposed unit is located on the North Slope, approximately 4-5 miles south of the Kuparuk River Unit (KRU). The proposed unit area covers approximately 30,651 acres within twelve individual State of Alaska oil and gas leases. Approval of the proposed Whiskey Gulch Unit Agreement (Agreement) would conform and modify the lease contracts to be consistent with the Agreement, and extend the term of leases for as long as they are subject to the Agreement. Four Five of the leases in the proposed unit area were offered in the North Slope Areawide 2000 Oil and Gas Lease Sale, held on November 15, 2000. DNR issued oil and gas leases ADL 389687 (Tract 2), ADL 389692 (Tract 7), ADL 389693 (Tract 6), ADL 389694 (Tract 8), and ADL 389695 (Tract 9), effective December 1, 2001, on State of Alaska lease form number DOG 200004, which reserves a 12.50 percent royalty to the State of Alaska. The seven-year primary lease term of these leases expires on November 30, 2008. The remaining seven leases in the proposed unit area were offered in State of Alaska Lease Sale 8087, held on December 5June 24, 19951998. DNR issued oil and gas leases ADL 385198389089 (Tract 1), ADL 385199389090 (Tract 5), ADL 385201389091 (Tract 4), ADL 389092 (Tract 3), ADL 389093 (Tract 10), ADL 389094 (Tract 11) and ADL 375202389095 (Tract 12), effective February December 1, 19961998, on State of Alaska lease form number DOG 92089609 (rev. 6/97), which reserves a 12.50 percent royalty to the State of Alaska. The seven-year primary lease term of these leases expires on January 31November 30, 2003. The remaining lease in the proposed unit area was offered in State of Alaska Lease Sale 65, held on June 4, 1991. DNR issued ADL 377051, effective August 1, 1991, on State of Alaska lease form number DNR 10-4037 (Revised September, 1990), which provides for a ten-year primary term. Without unitization, lease ADL 377051 expires July 31, 2001. BPXA initially purchased the four Sale 80 leases, and then assigned 25% of the working interest in each to Arco (Alaska), Inc. (AAI). AAI changed its name to ▇▇▇▇▇▇▇▇ (Alaska), Inc. (PAI) effective April 27, 2000. Earlier this year, PAI assigned its 25% working interest in the leases to AVCG. ADL 377051 was originally issued to AAI in Sale 65. Less than a year al ter, AAI assigned ▇▇▇▇▇▇▇▇ Petroleum Company and Texaco Exploration Alaska each a one-third working interest in the lease. ▇▇▇ later assigned an 81/3% working interest ownership in the lease to Exxon Corporation, thus retaining a 25% working interest. In December 2000, Texaco Exploration Alaska assigned its working interest to ▇▇▇▇▇▇▇▇ Petroleum Company, which became the property of PAI following the BP-ARCO merger. Earlier this year, Exxon Corporation agreed to assign its working interest in the lease to AVCG, and ▇▇▇▇▇▇▇▇ Petroleum Company has agreed to do the same for its working interest in the proposed unit. Upon approval of these pending assignments, BPXA and AVCG will have 62% and 38% effective working interests in the unit area, respectively. The Agreement, if approved, will extend the term of the leases for as long as they are subject to the Agreement. 11 AAC 83.1902005.

Introduction and Background. On June 1August 10, 2001, AVCG LLC ▇▇▇▇▇▇▇▇ Alaska, Inc. (AVCG) ▇▇▇▇▇▇▇▇), as the designated Cosmopolitan Unit operator, filed the Sakonowyak River Cosmopolitan Unit application (Application) with the Division of Oil and Gas (Division) on behalf of BP Exploration (Alaska) Inc. (BPXA), the designated unit operator. The proposed unit is located in Gwydyr Bay Alaska, at the mouth of the Sakonowyak River, south of the Northstar Unit and north of the Prudhoe Bay Unit. The proposed unit area covers approximately 11,520 acres within five individual State of Alaska oil and gas leases. AVCG submitted the Application for approval by the State of Alaska, Department of Natural Resources (DNR), and the U. S. Department of Interior, Minerals Management Service (MMS), on behalf of itself and the other majority working interest owner, Forest Oil Corporation (Forest). The proposed unit is located on the Kenai Peninsula, offshore, north of Anchor Point. The proposed unit area covers approximately 24,601 acres of which approximately 14,835 acres are State of Alaska lands within seven individual State of Alaska oil and gas leases. The remaining approximately 9,766 acres proposed for the Cosmopolitan Unit are federal Outer-Continental Shelf (OCS) lands within two MMS oil and gas leases. Approval of the proposed Cosmopolitan Unit Agreement (Agreement) would conform and modify the lease contracts to be consistent with the Agreement, and extend the term of leases for as long as they are subject to the Agreement. Four A summary of the State of Alaska leases proposed for the Cosmopolitan Unit follows. Two of the leases in the proposed unit area were offered in State of Alaska Lease Sale 8078, held on October 31, 1994. DNR issued oil and gas leases ADL 384403 (Tract 3) and ADL 384404 (Tract 4), effective January 1, 1995, on State of Alaska lease form number DOG 9208. The seven-year primary lease term of these leases expires on December 531, 2001. One of the leases was offered in State of Alaska Lease Sale 78W, held on November 14, 1995. DNR issued oil and gas leases ADL 385198, ADL 385199, ADL 385201, and ADL 375202387102 (Tract 1), effective February 1, 1996, on State of Alaska lease form number DOG 9208. The seven-year primary lease term of these leases this lease expires on January 31, 2003. Another lease in the proposed unit area was offered in the Cook Inlet Areawide 1999 Oil and Gas Lease Sale, held on April 21, 1999. DNR issued oil and gas lease ADL 389230 (Tract 6), effective February 1, 2000, on State of Alaska lease form number DOG 9609 (rev. 9/99). The seven-year primary lease term of this lease expires on January 31, 2007. Two of the leases were offered in the Cook Inlet Areawide 2000 Oil and Gas Lease Sale, held on August 16, 2000. DNR issued oil and gas leases ADL 389525 (Tract 8) and ADL 389526 (Tract 9), effective May 1, 2001, on State of Alaska lease form number DOG 200004. The seven-year primary lease term of these leases expire on April 30, 2008. The remaining lease in the proposed unit area was offered in State of Alaska Lease Sale 659, held on June 4July 11, 19911962. DNR issued ADL 37705118790 (Tract 7), effective August September 1, 19911962, on State of Alaska lease form number DNR 10-4037 DL-1 (Revised SeptemberRev. April, 19901961). The Starichkof State #1Well, which provides a certified well capable of production in paying quantities, is located on ADL 18790. All seven leases retain a 12.5 percent royalty to the State of Alaska. The two MMS leases were offered in Cook Inlet OCS Oil and Gas Lease Sale 149, held on June 11, 1997. The leases were effective August 1, 1997, for a tenfive-year primary lease term. Without unitization, lease ADL 377051 expires The leases expire July 31, 2001. BPXA initially purchased the four Sale 80 leases2002, and then assigned 25reserve a 12.5% of the working interest in each to Arco (Alaska), Inc. (AAI). AAI changed its name to ▇▇▇▇▇▇▇▇ (Alaska), Inc. (PAI) effective April 27, 2000. Earlier this year, PAI assigned its 25% working interest in the leases to AVCG. ADL 377051 was originally issued to AAI in Sale 65. Less than a year al ter, AAI assigned ▇▇▇▇▇▇▇▇ Petroleum Company and Texaco Exploration Alaska each a one-third working interest in the lease. ▇▇▇ later assigned an 81/3% working interest ownership in the lease to Exxon Corporation, thus retaining a 25% working interest. In December 2000, Texaco Exploration Alaska assigned its working interest to ▇▇▇▇▇▇▇▇ Petroleum Company, which became the property of PAI following the BP-ARCO merger. Earlier this year, Exxon Corporation agreed to assign its working interest in the lease to AVCG, and ▇▇▇▇▇▇▇▇ Petroleum Company has agreed to do the same for its working interest in the proposed unit. Upon approval of these pending assignments, BPXA and AVCG will have 62% and 38% effective working interests in the unit area, respectively. The Agreement, if approved, will extend the term of the leases for as long as they are subject royalty to the Agreement. 11 AAC 83.190federal government.