F I LED SEP 22 2014

BEFORE THE BOARD OF OIL, GAS AND MINING DEPARTMENT OF NATURAL RESOURCES SECRETARY, BOARD OF

STATE OF UTAH O1l, GAS & MINING '

IN THE MATTER OF THE REQUEST FOR AGENCY

ACTION OF QEP ENERGY COMPANY FOR' AN

ORDER SUSPENDING THE APPLICATION OF UTAH

ADMIN. CODE R649-3-2, R649-3-10, AND R649-3-

11(1) AND (2) FOR THE OURAY PARK II FEDERAL

EXPLORATORY UNIT, COVERING ALL OF SECTION

2, ALL OF SECTION 3, THE NY2, NY2SY2, SY2SEV4, AND THE Sm�SWI4 OF SECTION 10, THE

WYzNEV4, WY2, SE\l4NE\14, AND THE SE\14 OF

SECTION 11, THE WY2SW\14 AND THE SE\I4SWV4 OF

SECTION 12, AND THE EY2 OF SECTION 14,

TOWNSHIP 7 SOUTH, RANGE 20 EAST, SLM, UINTAH COUNTY, UTAH,

EXHIBITS

Docket No. 2014-031

Cause No. 191-06

QEP Energy Company ("QEP"), by and through its attorneys, Holland & Hart LLP, submits the

following exhibits:

GENERAL EXHIBITS

EXHIBIT A Resumes

EXHIBITB OP II Unit Agreement

EXHIBIT C Exhibit B to the OP II Unit Agreement

EXHIBITD BLM Letter Approving Unit

LAND EXHIBITS

EXHIBITL-l Overview Map

EXHIBIT L-2 Subject Area Map

EXHIBIT L-3 Topographic Overlay Map

GEOLOGY EXHIBITSl

EXHIBIT G-l Structure Map

I Provided show the general geology of lands located in close proximity to the subject lands. QEP has included and is utilizing several exhibits from Finley Resources' presentation in Docket No. 2014-031, Cause No. 270-03.

EXHIBITG-2 Daily Production Plot

EXHIBITG-3 Cross-Section Locator Map

EXHIBIT G-4-6 Cross Section A-A', Sand Geometry, and OOIP

ENGINEERING EXHIBIT2

EXHmITE-l Oil in Place

DATED this 22nd day of September, 2014.

Address of Petitioner: QEP Energy Company Attention: Theresa Chatman 1050 17th Street, Suite 500 Denver, CO 80265 Telephone: (303) 640-4210

QEPENERGY COMPANY

By *£� William E. W'lil-d \ Mark L. Burghardt HOLLAND & HART, LLP 222 South Main Street, Suite 2200 Salt Lake City, UT 84101 Telephone: (801) 799-5800 Attorneys for Petitioner, QEP Energy Company

2 Provided to justify the requested setback by showing that any wells lopated in the subject lands will drain less than 40 acres. QEP has included and is utilizing this exhibit from Finley Resources' presentation in Docket No. 2014-031, Cause No. 270-03. This exhibit discusses the expected drainage of wells located in close proximity to the subject lands.

1050 1 ih Street Suite 800 Denver, CO 80265

INDUSTRY EXPERIENCE

ERIKA P . DAVIS erika.davis@qepres.com

303-308-3067

QEP Energy Company/Questar E&P August 2006·Present Uinta Division

Uinta Basin • Lead geologist developing new Green River unconventional oil play • Perform petrophysical log analysis and create OOIP, isopach, and pay maps • Develop geologic model and predict trends in OEP's area • Evaluate acquisitions and lease sales throughout the basin • Mentor new Geologists • Analyze core and cuttings • Plan vertical and directional wells with consideration for economic limits • Develop 3 P and Tactical plan

Legacy Division Powder River Basin • Map the Shannon and Sussex sands and pay intervals in OEPs acreage • Prepare geology exhibits for spacing oil and gas hearings • Geosteer 4 Sussex wells in horizontal drilling program • Evaluate lease sales and non-op proposals throughout the basin • Prepare geology for the divesture of OEP's main Powder River Basin asset

Greater Green River Basin • Monitor Wamsutter and Vermillion rig operations including wireline and specialty logging • Manage rig schedule for multiple plays • Evaluate image logs through the Baxter shale interval for natural fractures and horizontal

well potential • Perform completions evaluation • Evaluate lease sales and non-op proposals throughout the basin

San Juan Basin • Evaluate acreage for new drilling opportunities • Construct hand drawn net-sandstone isopach maps and integrate production data to

select drill sites • Generate prospects and new wells • Evaluate lease sales and non-op proposals throughout the basin

Pinedale Division Pinedale Anticline • Manage drill schedule for 5 year drilling program with over 100 wells per year • Analyze wells for interference and adjust drilling pattern for appropriate drainage • Coordinate mud logging, wireline logging and core jobs for well site • Geologist overseeing 2-4 rigs drilling vertical wells over 3 years • Assist in developing prognosis database

Davis

SKILLS • Software Proficiency: Geographix, Spotfire, MS Office

page 2

• Graphics/Database: CorelDraw, IHS Energy, Drilling Info, Carte • Team player, Learning to Lead course, efficient time management skills • Work closely with Reservoir Engineer, Land man, Production, Completions, and Regulatory • Developing and executing a drill and recompletion program

PROFESSIONAL AFFILIATIONS • American Association of Petroleum Geologists, Rocky Mountain • Rocky Mountain Association of Geologists • Professional Geologist, state of Wyoming, PG-3852

EDUCATION • M.S. Geology, University of Massachusetts, Amherst, September 2004

Emphasis in Structural Geology Thesis Title "Do Joints Rotate with Lateral Fold Growth at Sheep Mountain Anticline?"

• B.S. Geology, New Mexico Institute of Mining and Technology, May 1999

Daniel J. Rabiolo, P .E. 1050 17th St, Ste 500 Denver, CO 80265

Daniel.Rabiolo@qepres.com (303) 672-6968

PROFESSIONAL EXPERIENCE

QEP ENERGY / QUESTAR E&P, Denver, Colorado

Uinta / San Juan Division (Dec 2012 - Present) Senior Reservoir Engineer

2008-Present

• Responsible for reserves, forecasting, 3P analysis, and development planning including an exploratory Green River unconventional oil play

• Perform economic and volumetric evaluations on acquisitions, divestitures, lease sales, well proposals, and other projects for both operated and non-operated properties

Senior Operations Engineer • Plan and oversee recompletions and workovers for both oil and gas projects • Evaluate and recommend actions on existing and new water flood projects • Work with regulatory and geology to create and execute injection and disposal permits through the EPA

permitting process

High Plains (Legacy) Division (Aug 2008 - Dec 2012) Senior Reservoir Engineer • Responsible for reserves, forecasting, 3P analysis, and development planning • Primary reservoir engineer responsible for QEP's North Dakota acreage position • Create, review, and defend performance curves for all wells in areas of supervision including ND, MT,

NM, CO, WYand work with third party reserves companies to perform reserves evaluations • Perform economic and volumetric evaluations on acquisitions, divestitures, lease sales, well proposals, and

other projects for both operated and non-operated properties • Create exhibits and testify for NDIC hearings including spacing, infilling, flaring, and field expansions • Provide instruction, guidance, and explanations to engineering techs and new engineers • Present regularly to upper management for approval and information distribution

HEADINGTON OIL CO, Denver, Colorado

Petroleum Engineer 1

2007-2008

• Tracked production, created hearing documents, and compiled economic evaluations for MT and NO Bakken properties

• Kept the reserves database current with acreage holdings and concurrent with operating schedules for producing and 3P wells

• Forecasted production for operated and non-operated wells • Provided instruction, guidance, and explanations to a new engineering tech • Used reserves analysis to study the economic implications of infill wells for our area of operation. • Worked with third party reserves analysts to complete reserves reviews

ENCANA OIL AND GAS (USA) INC, Denver, Colorado

Drilling Engineer (2006 - 2007)

2005-2007

• Wrote drilling procedures, evaluated rig efficiency and performance, reviewed and updated cost estimates. Engineering Intern (Summer 2005)

Daniel J. Rabiolo, P.E. 1050 17th St, Ste 500 Denver, CO 80265

EDUCATION

Daniel.Rabiolo@qepres.com (303) 672-6968

B.S. Petroleum Engineering with High Scholastic Honors, Colorado School of Mines - May 2006

PROFESSIONAL DEVELOPMENT AND SKILLS

Memberships and Registrations • Professional Engineer, State of Colorado, Registration #46027 • Denver Chapter of SPE

Software Proficiencies • MS Office, Excel, PowerPoint, ARIES, Access, Carte, WellView

Skills • Work closely with Land, Regulatory, Completions, and Geology • Tactical Planning, Reserves, and 3P analysis • Acquisition and Divestiture Economics • EPA Injection and Disposal Well Applications • Presentations and management approval recommendations • State commission exhibits and testimony

2

UNIT AGREEMENT AND PLAN OF UNITIZATION

FOR THE DEVELOPMENT AND OPERATION

OF THE

OURAY PARK II UNIT

COUNTY OF UINTAH

STATE OF UTAH

TABLE OF CONTENTS

SECTION Page

Preliminary Recitals... ........ . . . . . . . . . . . . . . . . . . . . . . . . .. . . .. . . . . . . . . . . . . . . . . . . .... . . . .. .... ... . . . . . 1

Enabling Act and Regulations ... ......... ..... . . . . .. .. ....... ...... ...... . . .. . . . . .. . . . . . . . .... . . .. .. . .. . ...... )

2 Unit Area ................. ......................................... . . . . . . . ... . ... . . .. . .. . .. . . . . .. . . . . .. . .... . . . ....... 1

3 Unitized Land and Unitized Substances .............................. . .. . ........ ................ ... ...... 3

4 Unit Operator .................................... . ................ . . .. . . . ......... . ........ ....... ..... .... ......... 3

5 Resignation or Removal of Unit Operator ........................... . . . . . . . . . . . . . . . . . . . . . ... . . . . . . . . . . . . 3

6 Successor Unit Operator ............................ ............................ ...... .... ...... . . . ............. 3

7 Accounting Provisions and Unit Operating Agreement ................ . . . . . .. .... ............... .... 4

8 Rights and Obligations of Unit Operator ........................... . . . . . . . . . . . . . .. . . . . . . . . . . . .. . . .. . . :... 4

9 Dril ling to Discovery ............................................. . . . . . . . . . . . . . .. .. . . . . ... . . . . . . . . . . . . . . . .. . .. . ... 4

10 Plan of Further Development and Operation .................. ........ . . . . . . . . . . . . . . . . .. . . . . . . . . . . . .. ... 5

11 Participation After Discovery ..................................... . .. . . . . . . . . ... . . . . . . . .. . . . . .. ... . . . .. . . .... 6

12 Allocation of Production ..................................... . ..... . . . . .. . .. . . . . .. . .. . . . . . . . . .. . . . ... . . . .. . .... 7

13 Development or Operation of Non-Participating Lands or Formations . . . . . . ... ... . . . . ... .... 7

14 Royalty Settlement ............................................. . .. . . .... ... . . .. . . . . . .. ... ..... ............... . ... 7

15 Rental Settlement .... .............................................. . . . . . . . . . . . . . .. . . . . .. . . . .. .. ... . . .. . . . . . . . . . . . . 8

16 Conservation .... ........... ............................. ..... ..... . ..... .... . .. ...... ... ... ... ...... ... ............. 8

17 Drainage ................. . .......... .... ........................... . .. . .. . .. . .. . .. . .. . .. . .. . .. . . . . .. . .. .. . .. . . .. . ...... 8

18 Leases and Contracts Conformed and Extended ....................... . . ......... ........ .............. 9

19 Covenants Run With Land ................... ........................ . . ... . . . . . .. . . .. . . . . .. . . . . . . . . . . . . . . . . .. . . 10

20 Effective Date and Term ............................................ . . . . . . . . . . . . . .. ... .. . ... . . ... .. . . . .. . . . . .... 10

21 Rate of Prospecting, Development and Production ................... . . . . .... . . .. . . . . . . . . . . . . . . . . . ... 11

22 Appearances ... . ... ............... ... .......... ....... .............. . . .. .. . .. . .. . .. . .. . . . . .. . .. . .. . .. . .. . . . . . . . .. .... 11

23 Notices ........... .................. ................................ . . . . . . . . . .. ... . . . . .. . . . . . . . . . . . . . .. . . . . . . . .. . ... ... 11

24 No Waiver of Certain Rights .... ...... ............................. . . . . . . . . . . . . . . .. .... .. . .. . . . . . . . . . . . . . ... . 11

25 Unavoidable Delay ................................................. . .. . .. . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . .. . . . . ... 11

26 Non-Discrimination ................ ................................. . . . ... . . . . . . . . . . . . . . . . . . . . . ... . . . . ... .. . . . . .. 11

27 Loss of Title ............................................... ....... . . . . . . . . .. . . ... . . .. . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . 12

28 Non-Joinder and Subsequent Joinder ............................ ... . . . . .. . . . . . . .... . . .... . . . . . . . . . ..... ... 12

29 Counterparts .... ....... ................ ............................ . . . ... . .. . .. . .. . .. ... . .. . .. . .. . . . . .. . .. . .. . .. .... 12

30 Surrender .......................................................... .. . . . . . .. . . . . . . ... . . . ... . . . . . . .. . . . . . . . ... . . . . . . . . 12

31 Taxes .............................................................. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ... 13

32 No Partnership ................................ . ... ................. . . .. .................. ............... ... ....... 13

33 Special Surface Stipulations ........................................ . . . . . . . .. . . . . . . . . . . . . . .. . . . . . . . . . . . . . .. . .. 13

34 Utah School and Institutional Trust Lands Administration Provision.. .............................. 13

Exhibit "A" - Map of Unit Area

Exhibit "B" - Schedule of Ownership

1 2

3

4

5

6

7

8

9

UNIT AGREEMENT

FOR THE DEVELOPMENT AND OPERATION

OF THE

OURAY PARK II UNIT

COUNTY OF UINTAH

STATE OF UTAH

CONTRACT NO. UTU

10 THIS AGREEMENT, entered into as of the approval date of final approval by the Bureau of 11 Land Management ("BLM"), by and between the pru1ies subscribing, ratifYing, or consenting 12 hereto, and herein referred to as the "parties hereto," 13 14 15

W I T N E S S E T H:

16 WHEREAS , the parties hereto are the owners of working, royalty, or other oil and gas interests 17 in the unit area subject to this agreement; and

18 WHEREAS , the Mineral Leasing Act of February 25, 1920,4 1 Stat. 4 37, as amended, 30 U.S.C. 19 Sec. 18 1 et seq., authorizes Federal lessees and their representatives to unite with each other, or 2 0 jointly o r separately with others, i n collectively adopting and operating under a unit plan of 2 1 development o r operations o f any oil and gas pool, field, or like area, o r any part thereof for the 22 purpose of more properly conserving the natural resources thereof whenever determined and 23 certified by the Secretary of the Interior to be necessary or advisable in the public interest; and

2 4 WHEREAS , the parties hereto hold sufficient interests i n the Ouray Park II Unit Area covering 2 5 the land hereinafter described to give reasonably effective control o f operations therein; and

26 WHEREAS , i t is the purpose of the parties hereto to conserve natural resources, prevent waste, 27 and secure other benefits obtainable through development and operation of the area subject to 28 this agreement under the terms, conditions, and limitations herein set forth;

29 NOW, THEREFORE, in consideration of the premises and the promises herein contained, the 30 parties hereto commit to this agreement their respective interests in the below-defined unit area, 31 and agree several ly among themselves as fol lows:

32 1 . ENABLING ACT AND REGULATIONS .

3 3 The Mineral Leasing Act o f February 25, 1920, as amended, supra, and al l valid pertinent 3 4 regulations including operating and unit plan regulations, heretofore issued thereunder o r valid, 3 5 pertinent, and reasonable regulations hereafter issued thereunder are accepted and made a part of 36 this agreement as to Federal lands, provided such regulations are not inconsistent with the terms 37 of this agreement; and as to non-Federal lands, the oil and gas operating regulations in effect as 38 of the effective date hereof governing drilling and producing operations, not inconsistent with the 39 terms hereof or the laws of the State in which the non-Federal land is located, are hereby 4 0 accepted and made a part ofthis agreement.

41 2. UNIT AREA.

42 The area specified on the map attached hereto marked Exhibit A is hereby designated and 43 recognized as constituting the unit area, containing 2,926.5 6 acres, more or less.

44 Exhibit A shows, in addition to the boundary of the unit area, the boundaries and identity of 4 5 tracts and leases in said area to the extent known to the Unit Operator. Exhibit B attached hereto 46 is a schedule showing to the extent known to the Unit Operator, the acreage, percentage, and kind 47 of ownership of oi l and gas interests in al l lands in the unit area. However, nothing herein or in 48 Exhibits A or B shall be construed as a representation by any party hereto as to the ownership of

Ouray Park II Unit Agreement Page 1 4/2912014

1 any interest other than such interest or interests as are shown in the Exhibits as owned by such 2 party. Exhibits A and B shall be revised by the Unit Operator whenever changes in the unit area 3 or in the ownership interests in the individual tracts render such revision necessary, or when 4 requested by the Authorized Officer, hereinafter referred to as AO and not less than four copies 5 of the revised Exhibits shall be filed with the proper BLM office.

6 The above-described unit area shall when practicable be expanded to include therein any 7 additional lands or shall be contracted to exclude lands whenever such expansion or contraction 8 is deemed to be necessary or advisable to conform with the purposes of this agreement. Such 9 expansion or contraction shall be effected in the following manner:

10 (a) Unit Operator, on its own motion (after preliminary concurrence by the AO), or on demand of 11 the AO, shall prepare a notice of proposed expansion or contraction describing the contemplated 12 changes in the boundaries of the unit area, the reasons therefor, any plans for additional dri l l ing, 13 and the proposed effective date of the expansion or contraction, preferably the first day of a 14 month subsequent to the date of notice.

15 (b) Said notice shall be delivered to the proper BLM office, and copies thereof mailed to the last 16 known address of each working interest owner, lessee and lessor whose interests are affected, 17 advising that 30 days will be allowed for submission to the Unit Operator of any objections.

18 (c) Upon expiration ofthe 30-day period provided in the preceding item (b) hereof, Unit Operator 19 shall file with the AO evidence of mailing of the notice of expansion or contraction and a copy of 20 any objections thereto which have been filed with Unit Operator, together with an application in 21 triplicate, for approval of such expansion or contraction and with appropriate joinders.

22 (d) After due consideration of all pertinent information, the expansion or contraction shall, upon 2 3 approval by the AO, become effective as o f the date prescribed i n the notice thereof o r such other 2 4 appropriate date.

25 (e) All legal subdivisions of lands (i .e., 40 acres by Government survey or its nearest lot or tract 26 equivalent; in instances of irregular surveys, unusually large lots or tracts shall be considered in 27 multiples of 40 acres or the nearest aliquot equivalent thereof), no parts of which are in or 28 entitled to be in a participating area on or before the fifth anniversary of the effective date of the 29 first initial participating area established under this unit agreement, shall be eliminated 30 automatically from this agreement, effective as of said fifth anniversary, and such lands shall no 3 1 longer be a part o f the unit area and shall no longer be subject to this agreement, unless diligent 32 dri l l ing operations are in progress on unitized lands not entitled to participation on said fifth 33 anniversary, in which event a l l such lands shall remain subject hereto for so long as such drilling 34 operations are continued diligently, with not more than 90-days time elapsing between the 35 completion of one such well and the commencement of the next such well. All legal subdivisions 36 of lands not entitled to be in a participating area within 10 years after the effective date of the 37 first initial participating area approved under this agreement shall be automatically elim inated 38 from this agreement as of said tenth anniversary. The Unit Operator shall, within 90 days after 39 the effective date of any elimination hereunder, describe the area so eliminated to the satisfaction 40 of the AO and promptly notify all parties in interest. All lands reasonably proved productive of 41 unitized substances in paying quantities by dil igent dri l l ing operations after the aforesaid 5-year 42 period shall become participating in the same manner as during said first 5-year period. However, 4 3 when such dil igent drilling operations cease, all nonparticipating lands not then entitled to be i n a 44 participating area shall be automatical ly eliminated effective as of the 91 sl day thereafter.

45 Any expansion of the unit area pursuant to this section which embraces lands theretofore 46 eliminated pursuant to this subsection 2(e) shall not be considered automatic commitment or 47 recommitment of such lands. If conditions warrant extension of the 1 0-year period specified in 48 this subsection, a single extension of not to exceed 2 years may be accomplished by consent of 49 the owners of 90 percent of the working interest in the current nonparticipating unitized lands 50 and the owners of 60 percent of the basic royalty interests (exclusive ofthe basic royalty interests 51 of the United States) in nonparticipating unitized lands with approval of the AO, provided such 52 extension application is submitted not later than 60 days prior to the expiration of said 1 0-year 53 period.

54

Ouray Park II Unit Agreement Page 2 4/29/2014

1 3. UNITIZED LAND AND UNITIZED SUBSTANCES.

2 All land now or hereafter committed to this agreement shall constitute land referred to herein as 3 "unitized land" or "land subject to this agreement." All oil and gas in any and al l formations of 4 the unitized land are unitized under the terms of this agreement and herein are called "unitized 5 substances. "

6 4. UNIT OPERATOR.

7 QEP Energy Company is hereby designated as Unit Operator and by signature hereto as Unit 8 Operator agrees and consents to accept the duties and obligations of Unit Operator for the 9 discovery, development, and production of unitized substances as herein provided. Whenever

1 0 reference i s made herein to the Unit Operator, such reference means the Unit Operator acting in 11 that capacity and not as an owner of interest in unitized substances, and the term "working 12 interest owner" when used herein shall include or refer to Unit Operator as the owner of a 13 working interest only when such an interest is owned by it.

14 5. RESIGNATION OR REMOVAL OF UNIT OPERATOR.

1 5 Unit Operator shal l have the right to resign at any time prior to the establishment of a 16 participating area or areas hereunder, but such resignation shall not become effective so as to 17 release Unit Operator from the duties and obligations of Unit Operator and terminate Unit 18 Operator's rights as such for a period of 6 months after notice of intention to resign has been 19 served by Unit Operator on all working interest owners and the AO and until all wells then 20 drilled hereunder are placed in a satisfactory condition for suspension or abandonment, 21 whichever is required by the AO, unless a new Unit Operator shall have been selected and 22 approved and shall have taken over and assumed the duties and obligations of Unit Operator 23 prior to the expiration of said period.

24 Unit Operator shall have the right to resign in like manner and subject to l ike limitations as above 25 provided at any time after a participating area established hereunder is in existence, but in all 26 instances of resignation or removal, until a successor Unit Operator is selected and approved as 27 hereinafter provided, the working interest owners shall be jointly responsible for performance of 28 the duties of Unit Operator, and shall not later than 30 days before such resignation or removal 29 becomes effective appoint a common agent to represent them in any action to be taken hereunder.

3 0 The resignation o f Unit Operator. shall not release Unit Operator from any liability for any default 31 by it hereunder occurring prior to the effective date of its resignation.

32 The Unit Operator may, upon default or fai lure in the performance of its duties or obligations 3 3 hereunder, be subject to removal by the same percentage vote of the owners of working interests 34 as herein provided for the selection of a new Unit Operator. Such removal shall be effective upon 35 notice thereof to the AO.

3 6 The resignation o r removal o f Unit Operator under this agreement shall not terminate its right, 37 title, or interest as the owner of working interest or other interest in unitized substances, but upon 38 the resignation or removal of Unit Operator becoming effective, such Unit Operator shall deliver 39 possession of all wells, equipment, materials, and appurtenances used in conducting the unit 4 0 operations to the new duly qualified successor Unit Operator or to the common agent, if no such 41 new Unit Operator is selected to be used for the purpose of conducting unit operations hereunder. 42 Nothing herein shall be construed as authorizing removal of any material, equipment, or 43 appurtenances needed for the preservation of any wells.

4 4 6. SUCCESSOR UNIT OPERATOR.

45 Whenever the Unit Operator shall tender h is or its resignation as Unit Operator or shall be 4 6 removed as hereinabove provided, or a change of Unit Operator is negotiated by the working 47 interest owners, the owners of the working interests according to their respective acreage 48 interests in a l l unitized land shal l, pursuant to the Approval of the Parties requirements of the unit 49 operating agreement, select a successor Unit Operator. Such selection shall not become effective 5 0 until:

Ouray Park II Unit Agreement Page 3 4129/2014

1 (a) Unit Operator so selected shall accept in writing the duties and responsibilities of Unit 2 Operator, and

3 (b) the selection shall have been approved by the AO. lfno successor Unit Operator is selected and qualified as herein provided, the AO at his election may declare this unit agreement

5 terminated.

6 7. ACCOUNTING PROVISIONS AND UNIT OPERATING AGREEMENT.

7 If the Unit Operator is not the sole owner of working interests, costs and expenses incurred by 8 Unit Operator in conducting unit operations hereunder shall be paid and apportioned among and 9 borne by the owners of working interests, all in accordance with the agreement or agreements

10 entered into by and between the Unit Operator and the owners of working interests, whether one 11 or more, separately or collectively. Any agreement or agreements entered into between the 12 working interest owners and the Unit Operator as provided in this section, whether one or more, 13 are herein referred to as the "unit operating agreement." Such unit operating agreement shall 14 also provide the manner in which the working interest owners shall be entitled to receive their 15 respective proportionate and allocated share of the benefits accruing hereto in conformity with 16 their underlying operating agreements, leases, or other independent contracts, and such other 17 rights and obligations as between Unit Operator and the working interest owners as may be 18 agreed upon by Unit Operator and the working interest owners; however, no such unit operating 19 agreement shall be deemed either to modify any of the terms and conditions of this unit 20 agreement or to relieve the Unit Operator of any right or obligation established under this unit 21 agreement, and in case of any inconsistency or conflict between this agreement and the unit 22 operating agreement, this agreement shall govern. Two copies of any unit operating agreement 23 executed pursuant to this section shall be fi led in the proper BLM office prior to approval of this 24 unit agreement.

25 8. RIGHTS AND OBLIGATIONS OF UNIT OPERATOR.

26 Except as otherwise specifically provided herein, the exclusive right, privilege, and duty of 27 exercising any and al l rights of the parties hereto which are necessary or convenient for 28 prospecting for, producing, storing, allocating, and distributing the unitized substances are hereby 29 delegated to and shall be exercised by the Unit Operator as herein provided. Acceptable evidence 30 of title to said rights shall be deposited with Unit Operator and, together with this agreement, 31 shall constitute and define the rights, privileges, and obligations of Unit Operator. Nothing

32 herein, however, shall be construed to transfer title to any land or to any lease or operating 33 agreement, it being understood that under this agreement the Unit Operator, in its capacity as 34 Unit Operator, shall exercise the rights of possession and use vested in the parties hereto only for 35 the purposes herein specified.

36 9. DRILLING TO DISCOVERY.

37 Within 6 months after the effective date hereof, the Unit Operator shall commence to drill an 38 adequate test wel l at a location approved by the AO, unless on such effective date a wel l is being 39 drilled in conformity with the terms hereof, and thereafter continue such drilling diligently until 4 0 the Green River formation zones down to H4a Lime, or its stratigraphic equivalent, have been 41 tested or until at a lesser depth unitized substances shall be discovered which can be produced in 42 paying quantities (to wit: quantities sufficient to repay the costs of dri l l ing, completing, and 4 3 producing operations, with a reasonable profit) o r the Unit Operator shall at any time establish to 4 4 the satisfaction o f the A O that further drilling of said wel l would be unwarranted or 45 impracticable, provided, however, that Unit Operator shall not in any event be required to dri l l 46 said well to a depth in excess of 7,500 feet. Until the discovery of unitized substances capable of 47 being produced in paying quantities, the Unit Operator shall continue drilling one wel l at a time, 48 allowing not more than 6 months between the completion of one well and the commencement of 49 drilling operations for the next well, until a well capable of producing unitized substances in 5 0 paying quantities is completed t o the satisfaction o f the AO o r until i t i s reasonably proved that 51 the unitized land is incapable of producing unitized substances in paying quantities in the 52 formations drilled hereunder. Nothing in this section shall be deemed to l imit the right of the 5 3 Unit Operator t o resign as provided in Section 5, hereof, o r as requiring Unit Operator to

Ouray Park II Unit Agreement Page 4 4/29/2014

1 commence or continue any drilling during the period pending such resignation becoming 2 effective in order to comply with the requirements of this section.

3 The AO may modify any of the drilling requirements of this section by granting reasonable 4 extensions of time when, in his opinion, such action is warranted.

5 Until the establ ishment of a participating area, the failure to commence a well subsequent to the 6 drilling of the initial obligation well, or in the case of multiple well requirements, if specified, 7 subsequent to the drilling of those multiple wells, as provided for in this (these) section(s), within 8 the time allowed including any extension of time granted by the AO, shall cause this agreement 9 to terminate automatically. Upon failure to continue drilling dil igently any well other than the

10 obligation well(s) commenced hereunder, the AO may, after 1 5 days notice to the Unit Operator, 11 declare this unit agreement terminated. Failure to commence drilling the initial obligation well, 12 or the first of multiple obligation wells, on time and to drill it diligently shall result in the unit 13 agreement approval being declared invalid ab initio by the AO. In the case of multiple well 14 requirements, failure to commence drilling the required multiple wells beyond the first well, and 15 to drill them diligently, may result in the unit agreement approval being declared invalid ab initio 16 by the AO.

17 10. PLAN OF FURTHER DEVELOPMENT AND OPERATION.

18 Within 6 months after completion of a well capable of producing unitized substances in paying 19 quantities, the Unit Operator shall submit for the approval of the AO an acceptable plan of 20 development and operation for the unitized land which, when approved by the authorized officer, 21 shall constitute the further drilling and development obligations of the Unit Operator under this 22 agreement for the period specified therein. Thereafter, from time to time before the expiration of 23 any existing plan, the Unit Operator shall submit for the approval of the AO a plan for an 24 additional specified period for the development and operation of the unitized land. Subsequent 25 plans should normally be filed on a calendar year basis not later than March I each year. Any 26 proposed modification or addition to the existing plan should be filed as a supplement to the 27 plan.

28 Any plan submitted pursuant to this section shall provide for the timely exploration of the 29 unitized area, and for the dil igent drilling necessary for determination of the area or areas capable 30 of producing unitized substances in paying quantities in each and every productive formation. 31 This plan shall be as complete and adequate as the AO may determine to be necessary for timely 32 development and proper conservation of the oil and gas resources in the unitized area and shall:

33 (a) SpecifY the number and locations of any wells to be drilled and the proposed order and time 34 for such dril ling; and

35 (b) Provide a summary of operations and production for the previous year.

36 Plans shall be modified or supplemented when necessary to meet changed conditions or to 37 protect the interests of all parties to this agreement. Reasonable diligence shall be exercised in 38 complying with the obligations of the approved plan of development and operation. The AO is 39 authorized to grant a reasonable extension of the 6-month period herein prescribed for 40 submission of an initial plan of development and operation where such action i s justified because n of unusual conditions or circumstances.

42 After completion of a well capable of producing unitized substances in paying quantities, no 43 further wells, except such as may be necessary to afford protection against operations not under 44 this agreement and such as may be specifically approved by the AO, shall be drilled except in 45 accordance with an approved plan of development and operation.

4 6 1 1. PARTICIPATION AFTER DISCOVERY.

47 Upon completion of a well capable of producing unitized substances in paying quantities, or as 48 soon thereafter as required by the AO, the Unit Operator shall submit for approval by the AO, a 49 schedule, based on subdivisions of the public-land survey or aliquot parts thereof, of all land then 50 regarded as reasonably proved to be productive of unitized substances in paying quantities. These 51 lands shall constitute a participating area on approval of the AO, effective as of the date of 52 completion of such well or the effective date of this unit agreement, whichever is later. The

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1 acreages of both Federal and non-Federal lands shall be based upon appropriate computations 2 from the courses and distances shown on the last approved public-land survey as of the effective 3 date of each initial participating area. The schedule shall also set forth the percentage of unitized 4 substances to be allocated, as provided in Section 12, to each committed tract in the participating 5 area so established, and shall govern the allocation of production commencing with the effective 6 date of the participating area. A different participating area shall be established for each separate 7 pool or deposit of unitized substances or for any group thereof which is produced as a single pool 8 or zone, and any two or more participating areas so established may be combined into one, on 9 approval of the AO. When production from two or more participating areas is subsequently

10 found to be from a common pool or deposit, the participating areas shall be combined into one, 11 effective as of such appropriate date as may be approved or prescribed by the AO. The 12 participating area or areas so established shall be revised from time to time, subject to the 13 approval of the AO, to include additional lands then regarded as reasonably proved to be 14 productive of unitized substances in paying quantities or which are necessary for unit operations, 15 or to exclude lands then regarded as reasonably proved not to be productive of unitized 16 substances in paying quantities, and the schedule of allocation percentages shall be revised 17 accordingly. The effective date of any revision shall be the first of the month in which the 18 knowledge or information is obtained on which such revision is predicated; provided, however, 19 that a more appropriate effective date may be used if justified by Unit Operator and approved by 20 the AO. No land shall be excluded from a participating area on account of depletion of its 21 unitized substances, except that any participating area established under the provisions of this 22 unit agreement shall terminate automatically whenever all completions in the formation on which 23 the participating area is based are abandoned.

24 It is the intent of this section that a participating area shall represent the area known or reasonably 25 proved to be productive of unitized substances in paying quantities or which are necessary for 26 unit operations; but, regardless of any revision of the participating area, nothing herein contained 27 shall be construed as requiring any retroactive adjustment for production obtained prior to the 28 effective date of the revision of the participating area.

29 In the absence of agreement at any time between the Unit Operator and the AO as to the proper 30 definition or redefinition of a participating area, or until a participating area has, or areas have, 31 been establ ished, the portion of al l payments affected thereby shall, except royalty due the United 32 States, be impounded in a manner mutually acceptable to the owners of committed working 33 interests. Royalties due the United States shall be determined by the AO and the amount thereof 34 shall be deposited, as directed by the AO, until a participating area is finally approved and then 3 5 adjusted in accordance with a determination o f the sum due as Federal royalty on the basis of 36 such approved participating area.

37 Whenever i t i s determined, subject to the approval of the AO, that a well drilled under this 38 agreement is not capable of production of unitized substances in paying quantities and inclusion 39 in a participating area of the land on which it is situated is unwarranted, production from such 4 0 well shall, for the purposes o f settlement among all parties other than working interest owners, be 41 allocated to the land on which the well is located, unless such land is already within the 42 participating area established for the pool or deposit from which such production i s obtained. 4 3 Settlement for working interest benefits from such a nonpaying unit well shall b e made as 44 provided in the unit operating agreement.

4 5 12. ALLOCATION O F PRODUCTION.

46 Al l unitized substances produced from a participating area established under this agreement, 47 except any part thereof used in conformity with good operating practices within the unitized area 48 for drill ing, operating, and other production or development purposes, or for repressuring or 49 recycling in accordance with a plan of development and operations that has been approved by the 5 0 AO, o r unavoidably lost, shall be deemed to be produced equally o n an acreage basis from the 51 several tracts of unitized land and unleased Federal land, if any, included in the participating area 52 establ ished for such production. Each such tract shall have allocated to it such percentage of said 5 3 production as the number o f acres o f such tract included in said participating area bears to the 54 total acres of unitized land and unleased Federal land, i f any, included in said participating area. 5 5 There shall b e allocated to the working interest owner(s) o f each tract o f unitized land i n said 56 participating area, in addition, such percentage of the production attributable to the unleased

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1 Federal land within the participating area as the number of acres of such unitized tract included 2 in said participating area bears to the total acres of unitized land in said participating area, for the 3 payment of the compensatory royalty specified in section 1 7 of this agreement. Al location of 4 production hereunder for purposes other than for settlement of the royalty, overriding royalty, or 5 payment out of production obligations of the respective working interest owners, including 6 compensatory royalty obl igations under section 1 7, shall be prescribed as set forth in the unit 7 operating agreement or as otherwise mutually agreed by the affected parties. It is hereby agreed 8 that production of unitized substances from a participating area shall be allocated as provided 9 herein, regardless of whether any wells are drilled on any particular part or tract of the

10 participating area. If any gas produced from one participating area i s used for repressuring or 11 recycling purposes in another participating area, the first gas withdrawn from the latter 12 participating area for sale during the life of this agreement shall be considered to be the gas so 13 transferred, until an amount equal to that transferred shall be so produced for sale and such gas 14 shall be allocated to the participating area from which initially produced as such area was defined 15 at the time that such transferred gas was finally produced and sold.

16 13. DEVELOPMENT OR OPERATION OF NONPARTICIPATING LAND OR

17 FORMATIONS.

18 Any operator may with the approval of the AO, at such party' s sole risk, costs, and expense, drill 1 9 a well o n the unitized land to test any formation provided the wel l is outside any participating 20 area established for that formation, unless within 90 days of receipt of notice from said party of 21 his intention to dri l l the well, the Unit Operator elects and commences to drill the well in a like 22 manner as other wells are drilled by the Unit Operator under this agreement.

23 If any well drilled under this section by a non-unit operator results in production of unitized 24 substances in paying quantities such that the land upon which it is situated may properly be 25 included in a participating area, such participating area shall be established or enlarged as 26 provided in this agreement and the well shall thereafter be operated by the Unit Operator in 2 7 accordance with the terms of this agreement and the unit operating agreement.

28 If any well drilled under this section by a non-unit operator that obtains production in quantities 29 insufficient to justify the inclusion of the land upon which such well is situated in a participating 30 area, such well may be operated and produced by the party drilling the same, subject to the 31 conservation requirements of this agreement. The royalties in amount or value of production 32 from any such well shall be paid as specified in the underlying lease and agreements affected.

33 1 4 . ROYALTY SETTLEMENT.

34 The United States and any State and any royalty owner who is entitled to take in kind a share of 35 the substances now unitized hereunder shall be hereafter be entitled to the right to take in kind its 36 share of the unitized substances, and Unit Operator, or the non-unit operator in the case of the 37 operation of a well by a non-unit operator as herein provided for in special cases, shall make 38 deliveries of such royalty share taken in kind in conformity with the applicable contracts, laws, 3 9 and regulations. Settlement for royalty interest not taken i n kind shall b e made by an operator 40 responsible therefore under existing contracts, laws and regulations, or by the Unit Operator on 41 or before the last day of each month for unitized substances produced during the preceding 42 calendar month; provided, however, that nothing in this section shall operate to relieve the 4 3 responsible parties o f any land from their respective lease obligations for the payment of any 44 royalties due under their leases.

45 If gas obtained from lands not subject to this agreement is introduced into any participating area 46 hereunder, for use in repressuring, stimulation of production, or increasing ultimate recovery, in 47 conformity with a plan of development and operation approved by the AO, a like amount of gas, 4 8 after settlement as herein provided for any gas transferred from any other participating area and 4 9 with appropriate deduction for loss from any cause, may be withdrawn from the formation into 50 which the gas is introduced, royalty free as to dry gas, but not as to any products which may be 51 extracted therefrom; provided that such withdrawal shall be at such time as may be provided in 52 the approved plan of development and operation or as may otherwise be consented to by the AO 5 3 as conforming to good petroleum engineering practice; and provided further, that such right of 54 withdrawal shall terminate on the termination of this unit agreement.

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1 Royalty due the United States shall be computed as provided in 30 CFR Group 200 and paid in 2 value or del ivered in kind as to all unitized substances on the basis of the amounts thereof 3 allocated to unitized Federal land as provided in Section 12 at the rates specified in the respective 4 Federal leases, or at such other rate or rates as may be authorized by law or regulation and 5 approved by the AO; provided, that for leases on which the royalty rate depends on the daily 6 average production per well , said average production shall be determined in accordance with the 7 operating regulations as though each participating area were a single consolidated lease.

8 15. RENTAL SETTLEMENT.

9 Rental or minimum royalties due on leases committed hereto shall be paid by the appropriate 10 parties under existing contracts, laws, and regulations, provided that nothing herein contained 1 1 shall operate to relieve the responsible parties of the land from their respective obligations for the 1 2 payment o f any rental o r minimum royalty due under their leases. Rental or minimum royalty for 1 3 lands o f the United States subject to this agreement shall b e paid at the rate specified i n the 14 respective leases from the United States unless such rental or minimum royalty is waived, 15 suspended, or reduced by law or by approval of the Secretary or his duly authorized 16 representative.

17 With respect to any lease on non-Federal land containing provisions which would terminate such 18 lease unless drilling operations are commenced upon the land covered thereby within the time 19 therein specified or rentals are paid for the privilege of deferring such dri l l ing operations, the 2 0 rentals required thereby shall, notwithstanding any other provision o f this agreement, be deemed 21 to accrue and become payable during the term thereof as extended by this agreement and until the 2 2 required drilling operations are commenced upon the land covered thereby, or until some portion 2 3 o f such land i s included within a participating area.

24 16. CONSERVATION.

25 Operations hereunder and production of unitized substances shall be conducted to provide for the 26 most economical and efficient recovery of said substances without waste, as defined by or 2 7 pursuant to State or Federal law or regulation.

28 1 7. DRAINAGE.

2 9 (a) The Unit Operator shall take such measures as the AO deems appropriate and adequate to 3 0 prevent drainage o f unitized substances from unitized land by wells o n land not subject to this 3 1 agreement, which shall include the drilling o f protective wells and which may include the 32 payment of a fair and reasonable compensatory royalty, as determined by the AO.

3 3 (b) Whenever a participating area approved under section 1 1 o f this agreement contains unleased 3 4 Federal lands, the value of 1 2 Y:z percent of the production that would be allocated to such Federal 35 lands under section 12 of this agreement, if such lands were leased, committed, and entitled to 3 6 participation, shall be payable as compensatory royalties to the Federal Government. Parties to 37 this agreement holding working interests in committed leases within the applicable participating 3 8 area shall be responsible for such compensatory royalty payment on the volume of production 3 9 reallocated from the unleased Federal lands to their unitized tracts under section 1 2 . The value of 40 such production subject to the payment of said royalties shall be determined pursuant to 30 CFR 4 1 part 206. Payment o f compensatory royalties on the production reallocated from unleased Federal 42 land to the committed tracts within the participating area shall fulfill the Federal royalty 4 3 obligation for such production, and said production shall b e subject to n o further royalty 4 4 assessment under section 1 4 o f this agreement. Payment o f compensatory royalties as provided 45 herein shall accrue from the date the committed tracts in the participating area that includes 4 6 unleased Federal lands receive a production allocation, and shall be due and payable monthly by 4 7 the last day o f the calendar month next following the calendar month o f actual production. If 48 leased Federal lands receiving a production allocation from the participating area become 49 unleased, compensatory royalties shall accrue from the date the Federal lands become unleased. 50 Payment due under this provision shall end when the unleased Federal tract i s leased or when 5 1 production o f unitized substances ceases within the participating area and the participating area is 52 terminated, whichever occurs first.

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1 18. LEASES AND CONTRACTS CONFORMED AND EXTENDED.

2 The terms, conditions, and provisions of all leases, subleases, and other contracts relating to 3 exploration, drilling, development or operation for oil or gas on lands committed to this 4 agreement are hereby expressly modified and amended to the extent necessary to make the same 5 conform to the provisions hereof, but otherwise to remain in ful l force and effect; and the parties 6 hereto hereby consent that the Secretary shall and by his approval hereof, or by the approval 7 hereof by his duly authorized representative, does hereby establish, alter, change, or revoke the 8 drilling, producing, rental, minimum royalty, and royalty requirements of Federal leases 9 committed hereto and the regulations in respect thereto to conform said requirements to the

1 0 provisions of this agreement, and, without limiting the generality of the foregoing, a l l leases, 1 1 subleases, and contracts are particularly modified in accordance with the following:

12 (a) The development and operation of lands subject to this agreement under the terms hereof 1 3 shall be deemed ful l performance of all obligations for development and operation with respect 14 to each and every separately owned tract subject to this agreement, regardless of whether there is 15 any development of any particular tract of this unit area.

16 (b) Drilling and producing operations performed hereunder upon any tract of unitized lands will 17 be accepted and deemed to be performed upon and for the benefit of each and every tract of 18 unitized land, and no lease shall be deemed to expire by reason of failure to dri ll or produce wells 19 situated on the land therein embraced.

2 0 (c) Suspension o f drilling o r producing operations o n all unitized lands pursuant t o direction or 2 1 consent o f the A O shall b e deemed to constitute such suspension pursuant t o such direction or 2 2 consent as to each and every tract of unitized land. A suspension of drilling or producing 2 3 operations l imited to specified lands shall be applicable only to such lands.

2 4 (d) Each lease, sublease, or contract relating to the exploration, drilling, development, or 2 5 operation for o i l o r gas o f lands other than those o f the United States committed to this 2 6 agreement which, by its terms might expire prior to the term ination o f this agreement, i s hereby 2 7 extended beyond any such term s o provided therein s o that it shall b e continued i n full force and 2 8 effect for and during the term o f this agreement.

2 9 (e) Any Federal lease committed hereto shall continue i n force beyond the term so provided 30 therein or by law as to the land committed so long as such lease remains subject hereto, provided 3 1 that production o f unitized substances i n paying quantities i s established under this unit 3 2 agreement prior to the expiration date of the term of such lease, or in the event actual drilling 3 3 operations are commenced on unitized land, in accordance with provisions of this agreement, 3 4 prior to the end of the primary term of such lease and are being diligently prosecuted at that time, 3 5 such lease shall b e extended for 2 years, and s o long thereafter as o i l o r gas i s produced in paying 3 6 quantities i n accordance with the provisions ofthe Mineral Leasing Act, as amended.

3 7 (f) Each sublease or contract relating to the operation and development of unitized substances 3 8 from lands of the United States committed to this agreement, which by its terms would expire 3 9 prior to the time at which the underlying lease, as extended b y the immediately preceding 4 0 paragraph, will expire is hereby extended beyond any such term s o provided therein so that it 4 1 shall be continued i n full force and effect for and during the term o f the underlying lease as such 4 2 term is herein extended.

4 3 (g) The segregation o f any Federal lease committed to this agreement i s governed by the 4 4 following provision in the fourth paragraph of sec. 17(m) of the Mineral Leasing Act, as 4 5 amended b y the Act o f September 2 , 1960 (74 Stat. 78 1-784) (30 U.S.C. 226(m)): "Any 4 6 [Federal] lease heretofore or hereafter committed to any such [unit] plan embracing lands that are 4 7 in part within and in part outside of the area covered by any such plan shall be segregated into 4 8 separate leases as to the lands committed and the lands not committed as o f the effective date of 4 9 unitization: Provided, however, That any such lease as to the non-unitized portion shall continue 5 0 in force and effect for the term thereof but for not less than two years from the date o f such 5 1 segregation and s o long thereafter as o i l o r gas i s produced i n paying quantities."

5 2 I f the public interest requirement i s not satisfied, the segregation of a lease and/or extension of a 5 3 lease pursuant t o 4 3 CFR 3 107.3- 2 and 4 3 CFR 3 1 07.4, respectively, shall not b e effective.

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1 (h) Any lease, other than a Federal lease, having only a portion of its lands committed hereto 2 shall be segregated as to the portion committed and the portion not committed, and the 3 provisions of such lease shall apply separately to such segregated portions commencing as of the 4 effective date hereof. In the event any such lease provides for a lump sum rental payment, such 5 payment shall be prorated between the portions so segregated in proportion to the acreage of the 6 respective tracts.

7 19. COVENANTS RUN WITH LAND.

8 The covenants herein shall be construed to be covenants running with the land with respect to the 9 interests of the parties hereto and their successors in interest until this agreement terminates, and

1 0 any grant, transfer or conveyance o f interest in land o r leases subj ect hereto shall be and hereby is 1 1 conditioned upon the assumption of all privileges and obl igations hereunder by the grantee, 1 2 transferee, o r other successor i n interest. No assignment o r transfer o f any working i nterest, 1 3 royalty, o r other interest subject hereto shall be binding upon Unit Operator until the first day of 1 4 the calendar month after Unit Operator i s furnished with the original, photostatic, o r certified 1 5 copy o f the instrument o f transfer.

1 6 20. EFFECTIVE DATE AND TERM.

1 7 This agreement shall become effective upon approval b y the A O and shall automatically 1 8 terminate 5 years from said effective date unless:

1 9 (a) Upon application by the Unit Operator such date o f expiration i s extended by the AO, or

2 0 (b) It is reasonably determined prior to the expiration of the fixed term or any extension thereof 2 1 that the unitized land i s i ncapable o f production o f unitized substances i n paying quantities in the 2 2 formations tested hereunder, and after notice o f intention t o terminate this agreement on such 2 3 ground i s given by the Unit Operator to all parties in interest at their last known addresses, this 2 4 agreement i s terminated with the approval of the AO, or

2 5 (c) A valuable discovery o f unitized substances i n paying quantities has been made or accepted 2 6 o n unitized land during said initial term or any extension thereof, i n which event this agreement

2 7 shall remain in effect for such term and so long thereafter as unitized substances can b e produced 2 8 i n quantities sufficient to pay for the cost of producing same from wells o n unitized land within 2 9 any participating area establ ished hereunder. Should production cease and diligent drilling or 30 reworking operations to restore production or new production are not i n progress within 60 days 3 1 and production is not restored or should new production not b e obtained in paying quantities on 3 2 committed lands within this unit area, this agreement wi l l automatically terminate effective the 3 3 last day o f the month in which the last unitized production occurred, or

3 4 (d) It i s voluntarily terminated as provided in this agreement. Except as noted herein, this 3 5 agreement may b e terminated at any time prior to the discovery o f unitized substances which can 3 6 b e produced i n paying quantities b y not less than 7 5 per centum, o n an acreage basis, o f the 3 7 working interest owners signatory hereto, with the approval o f the AO. The Unit Operator shall 3 8 give notice o f any such approval t o all parties hereto. I f the public interest requirement i s not 3 9 satisfied, the approval o f this unit by the A O shall b e invalid.

4 0 2 1 . RATE OF PROSPECTING, DEVELOPMENT, AND PRODUCTION.

4 1 The AO is hereby vested with authority to alter or modify from time to time, i n his discretion, the 4 2 quantity and rate o f production under this agreement when such quantity and rate are not fixed 4 3 pursuant to Federal o r State law, o r do not conform to any Statewide voluntary conservation or 4 4 allocation program which i s established, recognized, and generally adhered to by the majority of 4 5 operators i n such State. The above authority i s hereby limited to alteration or modifications 4 6 which are i n the public interest. The public interest to be served and the purpose thereof, must be 4 7 stated i n the order o f alteration o r modification. Without regard to the foregoing, the AO i s also 4 8 hereby vested with authority t o alter o r modify from time to time, i n his discretion, the rate of 49 prospecting and development and the quantity and rate of production under this agreement when 5 0 such alteration o r modification is in the interest o f attaining the conservation objectives stated i n 5 1 this agreement and i s not in v iolation o f any applicable Federal o r State law.

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1 Powers in this section vested to the AO shall only be exercised after notice to Unit Operator and 2 opportunity for hearing to be held not less than 1 5 days from notice.

3 22. APPEARANCES

4 The Unit Operator shall, after notice to other parties affected, have the right to appear for and on 5 behalf of any and all interests affected hereby before the Department of the Interior and to appeal 6 from orders issued under the regulations of said Department, or to apply for relief from any of 7 said regulations, or in any proceedings relative to operations before the Department, or any other

legally constituted authority; provided, however, that any other interested party shall also have 9 the right at its own expense to be heard in any such proceeding.

1 0 23. NOTICES.

1 1 A l l notices, demands, o r statements required hereunder to be given o r rendered t o the parties 1 2 hereto shall b e i n writing and shall b e personally delivered to the party o r parties, o r sent by 1 3 postpaid registered or certified mail, to the last-known address of the party or parties.

1 4 24. N O WAIVER O F CERTAIN RIGHTS.

1 5 Nothing contained i n this agreement shall be construed as a waiver by any party hereto o f the 1 6 right to assert any legal or constitutional right or defense as to the validity or invalidity of any law 1 7 o f the State where the unitized lands are located, o r of the United States, o r regulations issued 1 8 thereunder i n any way affecting such party, o r as a waiver b y any such party of any right beyond 1 9 his o r its authority to waive.

2 0 25. UNAVOIDABLE DELAY.

2 1 All obligations under this agreement requiring the Unit Operator to commence o r continue 2 2 dri l l ing, o r t o operate on, o r produce unitized substances from any o f the lands covered b y this 2 3 agreement, shall b e suspended while the Unit Operator, despite the exercise o f due care and 2 4 dil igence, i s prevented from complying with such obligations, i n whole or in part, by strikes, acts 2 5 o f God, Federal, State, o r municipal law or agencies, unavoidable accidents, uncontrollable 2 6 delays i n transportation, inability to obtain necessary materials or equipment i n the open market, 2 7 o r other matters beyond the reasonable control of the Unit Operator, whether similar to matters 2 8 herein enumerated o r not.

2 9 26. NON-DISCRIMINATION.

3 0 I n connection with the performance o f work under this agreement, the Unit Operator agrees to 3 1 comply with all the provisions of section 202 ( 1 ) to (7) inclusive, of Executive Order 1 1 246 (30 3 2 FR 1 23 1 9), as amended, which are hereby incorporated by reference in this agreement.

3 3 27. LOSS OF TITLE.

3 4 In the event title to any tract of unitized land shall fai l and the true owner cannot be induced to 3 5 join i n this unit agreement, such tract shall b e automatically regarded as not committed hereto, 3 6 and there shall b e such readj ustment o f future costs and benefits a s may b e required o n account 3 7 o f the loss o f such title. I n the event o f a dispute as to title to any royalty, working i nterest, or 3 8 other interests subject thereto, payment or delivery on account thereof may be withheld without 3 9 liability for interest until the dispute is finally settled; provided, that, as to Federal lands or leases, 4 0 no payments o f funds due the United States shall be withheld, but such funds shall b e deposited 4 1 as directed by the AO, to b e held as unearned money pending final settlement of the title dispute, 4 2 and then applied as earned or returned in accordance with such final settlement.

4 3 Unit Operator as such is relieved from any responsibility for any defect o r failure o f any title 4 4 hereunder.

4 5 28. NONJOINDER AND SUBSEQUENT JOINDER.

4 6 If the owner of any substantial interest i n a tract within the unit area fai ls or refuses to subscribe 4 7 or consent to this agreement, the owner of the working interest in that tract may w ithdraw the

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1 tract from this agreement by written notice delivered to the proper BLM office and the Unit 2 Operator prior to the approval of this agreement by the AO. Any oil or gas interests in lands 3 within the unit area not committed hereto prior to final approval may thereafter be committed 4 hereto by the owner or owners thereof subscribing or consenting to this agreement, and, if the 5 interest is a working interest, by the owner of such interest also subscribing to the unit operating 6 agreement. After operations are commenced hereunder, the right of subsequent joinder, as 7 provided in this section, by a working interest owner is subject to such requirements or 8 approval(s), i f any, pertaining to such joinder, as may be provided for in the unit operating 9 agreement. After final approval hereof, joinder by a nonworking interest owner must be

1 0 consented t o in writing by the working interest owner committed hereto and responsible for the 1 1 payment o f any benefits that may accrue hereunder i n behalf o f such nonworking interest. A 1 2 nonworking interest may not b e committed t o this unit agreement unless the corresponding 1 3 working interest i s committed hereto. Joinder to the unit agreement by a working interest owner, 1 4 at any time, must b e accompanied b y appropriate joinder to the unit operating agreement, in order 1 5 for the interest to be regarded as committed to this agreement. Except as may otherwise herein be 1 6 provided, subsequent joinders to this agreement shall b e effective as o f the date o f the filing with 1 7 the AO of duly executed counterparts of all or any papers necessary to establish effective 1 8 commitment of any interest and/or tract t o this agreement.

1 9 29. COUNTERPARTS.

2 0 This agreement may b e executed in any number o f counterparts, n o one o f which needs to be 2 1 executed b y all parties, or may b e ratified o r consented to by separate instrument in writing 2 2 specifically referring hereto and shall b e binding upon all those parties who have executed such a 2 3 counterpart, ratification, o r consent hereto with the same force and effect as if all such parties had 2 4 signed the same document, and regardless o f whether or not it i s executed by all other parties 2 5 owning or claiming a n interest in the lands within the above-described unit area.

2 6 30. SURRENDER.

2 7 Nothing i n this agreement shall prohibit the exercise by any working interest owner of the right 2 8 to surrender vested in such party by any lease, sublease, o r operating agreement as to all o r any 2 9 part of the lands covered thereby, provided that each party who will or m ight acquire such 3 0 working interest by such surrender or by forfeiture as hereafter set forth, is bound by the terms of 31 this agreement.

3 2 If as a result of any such surrender, the working interest rights as to such lands become vested in 33 any party other than the fee owner of the unitized substances, said party may forfeit such rights 34 and further benefits from operations hereunder as to said land to the party next in the chain of 3 5 title who shall b e and become the owner o f such working interest.

3 6 I f as the result o f any such surrender o r forfeiture working interest rights become vested i n the fee 3 7 owner of the unitized substances, such owner may:

3 8 (a) Accept those working interest rights subject t o this agreement and the unit operating 3 9 agreement; or

4 0 (b) Lease the portion o f such land as is included i n a participating area established hereunder 4 1 subject to this agreement and the unit operating agreement; or

4 2 (c) Provide for the independent operation o f any part o f such land that i s not then included within 4 3 a participating area established hereunder.

4 4 I f the fee owner o f the unitized substances does not accept the working interest rights subject to 4 5 this agreement and the unit operating agreement or lease such lands as above provided within 6 4 6 months after the surrendered or forfeited, working interest rights become vested in the fee owner; 4 7 the benefits and obligations o f operations accruing to such lands under this agreement and the

4 8 unit operating agreement shall b e shared by the remaining owners o f unitized working interests in 4 9 accordance with their respective working interest ownerships, and such owners o f working 5 0 interests shall compensate the fee owner o f unitized substances i n such lands by paying sums 5 1 equal to the rentals, minimum royalties, and royalties appl icable to such lands under the lease in 52 effect when the lands were unitized.

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1 An appropriate accounting and settlement shall be made for all benefits accruing to or payments 2 and expenditures made or incurred on behalf of such surrendered or forfeited working interests 3 subsequent to the date of surrender or forfeiture, and payment of any moneys found to be owing 4 by such an accounting shall be made as between the parties within 30 days.

5 The exercise of any right vested in a working interest owner to reassign such working interest to 6 the party from whom obtained shall be subject to the same conditions as set forth in this section 7 in regard to the exercise ofa right to surrender.

8 31. TAXES.

9 The working interest owners shall render and pay for their account and the account of the royalty 10 owners al l valid taxes on or measured by the unitized substances in and under or that may be 1 1 produced, gathered and sold from the land covered by this agreement after its effective date, or 1 2 upon the proceeds derived therefrom. The working interest owners o n each tract shall and may 1 3 charge the proper proportion of said taxes to royalty owners having interests in said-tract, and 1 4 may currently retain and deduct a sufficient amount of the unitized substances or derivative 1 5 products, or net proceeds thereof, from the allocated share of each royalty owner to secure 1 6 reimbursement for the taxes so paid. No such taxes shall be charged to the United States or the 1 7 State of Utah or to any lessor who has a contract with h is lessee which requires the lessee to pay 1 8 such taxes.

1 9 32. NO PARTNERSHIP.

2 0 It i s expressly agreed that the relation o f the parties hereto i s that o f independent contractors and 2 1 nothing contained i n this agreement, expressed or implied, nor any operations conducted 2 2 hereunder, shall create or be deemed to have created a partnership or association between the 2 3 parties hereto or any of them.

2 4 33. SPECIAL SURFACE STIPULATIONS.

2 5 Nothing in this Unit Agreement shall modifY the special Federal Lease stipulations attached to the 2 6 individual Federal Oil and gas Leases.

2 7 34. UTAH SCHOOL AND INSTITUTIONAL TRUST LANDS ADMINISTRATION

2 8 PROVISION .

2 9 Certain of the unitized land i s trust land o f the State o f Utah, and i n connection with the approval 3 0 o f this Agreement by the School and Institutional Trust Lands Administration of the State 3 1 pursuant to appl icable State and Federal regulations, i t i s agreed that there shall b e filed with the 32 Director:

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4 1

4 2

4 3

4 4

4 5

4 6

(a) Two copies of the complete Unit Agreement and two copies o f any revised Exhibits "A" and "B" with the filing thereof with the AO, pursuant to Section 2 hereof.

(b) One copy of any notice of the proposed expansion or contraction of the Unit Area required to be del ivered to the AO pursuant to Section 2(c) hereof.

( c) One copy of any unit operating agreement executed pursuant to Section 7 hereof

(d) One copy of any schedule of proposed participating area submitted for approval under Section I I , concurrently with its submission to the AO. The Director, or his authorized representative, shall have a period of fifteen ( l S) days from receipt of said schedule within which to file with the AO any objection thereto, together with any recommendation for revision thereof If such objection or recommendation is not concurred in by Unit Operator and AO prior to submission of the schedule to the AO for approval, the AO shall approve or disapprove the schedule after giving due consideration to the objections and recommendations fi led by the Director or his representative.

Ouray Park II Unit Agreement Page 1 3 4/29/201 4

1

2

(e) A copy of any proposed plan of development or modification thereof, which is filed with the AO under Section 1 0 hereof.

3 (f) A copy of all instruments of subsequent joinder executed under Section 28 hereof.

4 It is further agreed that:

5 ( I ) All valid, pertinent and reasonable regulations hereafter issued governing drilling 6 and producing operations on non-Federal lands which are not inconsistent with the terms 7 hereof or the laws of the State of Utah are hereby accepted and made a part of this 8 Agreement.

9 (2) Nothing in this Agreement contained shall relieve lessees of the trust lands of the 1 0 State o f Utah from their obligations to pay rental and royalties with respect to unitized 1 1 substances allocated to such lands hereunder, at the rates specified i n their respective 1 2 leases.

1 3 (3) In the event that a title dispute arises as to trust lands or leases, no payment of funds 1 4 due the School and Institutional Trust Lands Administration shall be withheld, but such 1 5 funds shall be deposited as directed by the Director to be held as unearned money pending 1 6 final settlement o f the title dispute, and then applied as earned or returned i n accordance 1 7 with such final settlement.

1 8 Each party to this Agreement, holding any lease or leases of trust lands from the School 1 9 and Institutional Trust Lands Administration, o r its predecessor, subject to this 2 0 Agreement, o r holding any interest i n o r under such lease o r leases or i n the production 2 1 from the lands covered thereby, agrees that said School and Institutional Trust Lands 2 2 Administration, and by its approval hereof, does hereby alter, change, modifY o r revoke 2 3 the drilling, producing and royalty requirements of such lease o r leases, and the 2 4 regulations i n respect thereto, to conform the provisions o f said lease or leases to the 2 5 provisions of this Agreement. Such parties and said School and Institutional Trust Lands 2 6 Administration further agree that, except as otherwise expressly provided in this 2 7 Agreement, no such lease shall be deemed to terminate or expire so long as i t shall 2 8 remain committed hereto. Notwithstanding anything to the contrary i n Section 1 8 hereof 2 9 contained, should any o f the trust lands of the State of Utah outside of a participating area 3 0 established hereunder cease to be committed to this Agreement, such lands shall 3 1 thereafter be free from the effect of this Agreement unless and until such lands are 3 2 expressly recomm itted to this Agreement pursuant to Section 28 hereof, with the approval 3 3 ofthe School and Institutional Trust Lands Administration.

3 4

3 5

3 6

3 7

3 8

3 9

4 0

4 1

4 2

4 3

4 4

4 5

4 6

Ouray Park I I Unit Agreement Page 14 4/291201 4

1 IN WITNESS WHEREOF, the parties hereto have caused this agreement to be executed and 2 have set opposite their respective names the date of execution.

3

AS UNIT OPERATOR AND WORKING INTEREST OWNER:

5

6

7 8 9

1 0 1 1 1 2 1 3 1 4 1 5 1 6 1 7 1 8 1 9

Address: J 050 J 7"' Street, Suite 500 Denver, CO 80265

20 STATE OF COLORADO 2 1 22 COUNTY OF DENVER

QEP ENERGY COMPANY

BY�2f?D Michael K. Watanabe Vice President. Land

§ § §

2 3 2 4 2 5 2 6 2 7 2 8 2 9

The foregoing instrument was acknowledged before me by Michael K Watanabe as Vice preSide� of QEP Energy Comp�ny

This _ day of +11 I 29.5 30 WI1NESS my hand and official seal. 3 1 32 My commission expires: 33 3 4 3 5

KRYSTAL RENEE DRAKE NOTARY PUBLIC

STATE OF COLORADO

NOTARY ID 20134025147 MY COMMISSION EXPIRES APRIL 19, 2017

Ouray Park II Unit Agreement Page 15 4129/2014

TRACT DESCRIPTION

NO. OF LAND

FEDERAL LANDS:

Townshil! Z §2uth - Rang� 2Q �a5t SLM

SEC 10: N/2. NI2S/2. SI2SEl4. SEl4SWI4 SEC 1 1 : W/2NEl4. WI2. SEl4NEl4. SEl4 SEC ,2: WI2SWI4. SEJ4SWl4 SEC 14: El2

2 Townshil;! 7 SOuth - Range 20 §ast SLM

SEC 3: LOT 1 (41.00). LOT 2 (40.95). LOT 3 (40.89). & LOT 4 (40.84). S/2N/2. S/2

FEDERAL TRACTS

!;lTATE LAN!;!!;l'

Townst:!il! 7 �2utb - Range 2Q East SLM

SEC 2: LOT 1 (40.58). LOT 2 (40.67). LOT 3 (40.77). LOT 4 (40.86). S/2N/2. 5/2 (ALL)

STATE TRACTS

TRACTS TOTAl.ING

NUM8ER SeRIAL NUMBER

OF & EFFECTIVE

ACRES DATE OF LEASE

1640.00 UTU·86331

EFF 1211/1949

EXHIBIT "B"

SCHEDULE SHOWING THE PERCMAGE AND KIND Of OWNERSHIP OF OIL AND GAS INTERESTS OURAY PARK UNIT II AREA

BASIC ROYAl. TY AND

PERCENTAGE

U S'A - 1\11 (1 2.5% royalty)

UINTAH COUNTY UTAH

LESseE. OF RECORD

AND PERCENTAGE

QEP Energy Company 100.0000%

Ol/ERRIOING ROYALTYIPROOl!CTlON INTERESTS

AND

PERCENTAGE

Nancy Kay Hargrove 1.16673% Cynthia K MUrchison 0 66668%

HBRL (UTSL-065342 ) LeMoyne H. Odell 0 66668%

643.68 UTU·14639

EFF 5/111971 HBP

2.283.68 TOTAL

642.88 UT ST ML-49758 EFF 6/112005

EXP 5/3112015

642.88 TOTAL

2.926.56 ACRES IN

U.S A - 1\11 (12 5% royal!y)

ACRES OR

Stale of Ulah -All (12. 5% royally)

ACRES OR

UNIT AREA

TOTAL 2 5001%

aEP Energy Company 100_0000% KFRT. LLC 3.000000%

78 03% OF UNIT AREA

aEP Energy Company 100.0000% NONE OF RECORD

21 ,97% OF UNIT AREA

100.00%

WORKING INTEREST

AND PERCENTAGE

aEP Energy Company 100.000000%

aEP Energy Company 100 .000000%

aEP Energy Company 100.000000%

United States Department of the Interior BUREAU OF LAND MANAGEMENT

IN REPLY REFER TO: 3 1 80 (UTU902 1 1 X) UT-922000

Ms. Theresa Chatman QEP Energy Company 1 050 1 7'h Street, Suite 500 Denver, Colorado 80265

Dear Ms. Chatman:

Utah State Office 440 West 200 South, Suite 500

Salt Lake City, UT 84101 http://www.blm.gov/ut/st/en.html

JUN -',2 2014

The Ouray Park II Unit Agreement, Uintah County, Utah, is approved effective June 2, 20 14. This agreement has been designated No. UTU9021 1X.

This unit provides for the drilling of one obligation well and subsequent drilling obligations pursuant to Section 9 ofthe unit agreement. The initial well is to be drilled to a true vertical depth of 7,500 feet or a depth sufficient to test the Green River Formation down to the H4a lime, whichever is less; and located in the NWY4 of Section 2, Township 7 South, Range 20 East, SLB&M, Uintah County, Utah.

No extension oftime beyond December 2, 2014, will be granted to commence the "obligation well" other than "unavoidable delay" (Section 25), where justified.

Approval of this agreement does not warrant or certify that the operator thereof and other holders of operating rights hold legal or equitable title to those rights in the subject leases which are committed hereto.

The basic information is as follows:

1 . The depth of the test well and the area to be unitized were approved under the unit plan regulations of December 22, 1 950, by Bureau of Land Management letter dated May 8, 20 14.

2 . All substances are unitized.

3 . The unit area embraces 2,926.56 acres, more or less, of which 2,283 .68 acres (78.03 percent) are Federal lands and 642.88 acres (2 1 .97 percent) are State lands.

The following leases embrace lands included within the unit area:

UTU8633 1 * UTU 1 4639*

* Indicates lease to be considered for segregation by the Bureau of Land Management pursuant to Section 1 8 (g) of the unit agreement and Public Law 86-705.

All lands and interests are fully or effectively committed. Also, certain overriding royalty interest owners have not signed the unit agreement. All parties owning interests within this unit area were invited to join the unit agreement.

In view of the foregoing commitment status, effective control of operations within the unit area is assured. We are ofthe opinion that the agreement is necessary and advisable in the public interest and for the purpose of more properly conserving natural resources.

The Certification-Determination, signed by the School and Institutional Trust Land Administration for the State of Utah (SITLA), is attached to the enclosed agreement.

Copies of the approved agreement are being distributed to the BLM Vernal Field Office, Utah Division of Oil, Gas and Mining, SITLA, and the Office of Natural Resources Revenue. You are requested to furnish all other interested parties with appropriate evidence of this approval.

If there are any questions, please contact Judy Nordstrom at (80 1 ) 5 3 9-4 1 08.

cc: UDOGM SITLA ONRR w/Exhibit B (Attn: Jennifer Cortez) FOM - Vernal w/enclosure

Sincerely,

tr :L Roger L. Bankert Chief, Branch of Minerals

CERTIFICATION - DETERMINATION

Pursuant to the authority vested in the Secretary of the Interior, under the Act approved

February 25, 1 920, 41 Stat. 43 7, as amended, 30 U.S.C. sec 1 8 1 , et seq., and delegated to the

Authorized Officer of the Bureau of Land Management, under the authority of 43 CFR 3 1 80, I

do hereby:

A. Approve the attached agreement for the development and operation of the Ouray

Park II Unit Area, Uintah County, Utah. This approval shall be invalid ab initio if the public

interest requirement under § 3 1 83 A(b) of this title is not met.

B. CertifY and determine that the unit plan of development and operation

contemplated in the attached agreement is necessary and advisable in the public interest for the

purpose of more properly conserving the natural resources.

C. Certify and determine that the drilling, producing, rental, minimum royalty and

royalty requirements of all Federal leases committed to said Agreement are hereby established,

altered, changed or revoked to conform with the terms and conditions of this agreement.

Dated: June 2, 20 1 4

Contract No: UTU9021 IX

Roger L. Bankert Chief, Branch of Minerals Bureau of Land Management

Box Elder

Tooele

Juab

Millard

Beaver

Iron

Washington

Ouray Park I I Unit

Rich

../

-�satch Duchesne G Utah \ Uinta

� 1 __

J Carbon if

Sanpete 1.-___ ;-Emery Grand

.J Sevier

San Juan

Kane

aEP Energy Company

Land Exh i bit L-1 T7S-R20E

U intah Cou nty, Utah

Docket No. : 201 4-031 Cause No. : 1 91 -06

3

1 0 1 1

7S 20E

C Ouray Park I I Unit

1 2

1 3

n . .-

QEP Energy Company

Land Exh i bit L-2 T7S-R20E

U i ntah Cou nty, Utah

Docket No. : 201 4-031 Cause No. : 1 9 1 -06

C Ouray Park II Un it o 400 ft windows

QEP Energy Company

Land Exh ibit L-3 T7S-R20E

U i ntah Cou nty, Utah

Doc ket No. : 201 4-031 Cause No.: 1 9 1 -06

Structu re M a p - to p of X M a rke r, S u bsea Conto u r I nte rva l : 100 feet

7. ' 1 ! l 1';

\

N o 1 mi

---+- - -Ouray Park II Unit

7S 20 1';

o .-

----

--

THREE RIVERS

-\ -

\

,1s :m \

---

I I

1.- - 500 /"

- � -

o

r

QEP Energy Company

Exhibit G-1

Docket N o . : 20 14-0 3 1

Ca use N o . : 19 1-06

Type Log

QJ C QJ U 0 UJ

ru c: ru u o � III Q..

c 0 :.::; ro E '-0 u.. ..... W > ii: c w Q) ..... t.!J

'" ,., ell .... ... t!:> ell 10.... .::: ell C:: a. a.

�

lEP Energy Company

LEY U i nta Bas i n Stratigraphy - Th ree Rive rs Type Wel l EXH I B IT G

Tl-IREE RNERS 34-31 ·no .

GREEN RIVER

01359 ft md I!"""'""":n---==� MAHOGANY BENCH

��;i'-..J.>"KUltN GULCH MARKER

70 > .. .l!i ,: 'U � o a. e Q..

PERFS Indicated In P IN� 7787 ft rnd

" 1 "

'> "

"

"

'. 7S 20E I ,-; I '" " D ...

..

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: ��i , . . . , . ,,' ,,. . .

,,4S 3E .. n -

. .� .' .. . ..

' , . .

t " "

8$ 20E i :J ,. ' N

Scale � 1 mile The i nterva l to be spaced is defined as:

The stratigra phic equiva l ent of the

inte rval between the Ma hoga ny Bench

top, as fou n d at 4,359', a nd

a p p roximately 1,000' into the

Pa leoce ne Wasatch, as fou n d at 7,787',

on t h e l og fo r the U lt ra Resou rces

Three Rive rs 34-31-720 Wel l located i n Section 34, nS-R20E, SLM .

DDcket: 2014-0Z4 Cause: 270�3

Exh ibit G-2

Docket N o . : 2014-031

Ca use N o . : 19 1-06

C ross-secti 0 n

Locato r M a p

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7S J !lE

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-1/" • , • <> (

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· · ·

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Ouray Park II Unit

" • * • <> <>

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QEP Energy Company

Exh ibit G-3

Docket N o . : 2014-031

Ca use No. : 191-06

Cross Secti on A-A'

A Three Rivers 16-41-820

Three Rivers 34-31-720 OP 16G-12-7-20

Mahogany Bench ----.;=:....-�-----��___!:i!�----_�-...JIi_

X Marker

Douglas Creek ���;:::------�!'--T---

Castle Peak

Uteland Butte

Wasatch

--.------

A'

aEP Energy Company

The s u bject fo rm ations

co nsist of l acustri ne fl uvia l ­

d e lta i c deposits in the G reen

Rive r and a l l uvia l/fl uvi a l fa n

d e ltas in the Wasatch.

Ave rage porosities i n the

G reen River a re 8% to 10% with ave rage permea b i l ity of

'" .05 to . 1 m O. T he Wasatch

in th is a rea typ ica l ly ave rages

less t h a n 8% porosity a nd

less tha n .05 m O

permeabi l ity.

Exh i bit G-4

Docket N o . : 20 14-03 1

Ca use N o . : 191-06

S a n d G eo m etry

EXH I BIT K-l . FI N LEY Green R iver Reservoir Geo m etries (N ine Mi le Canyon Ou tcrop Ana logy)

r e s , o, ,� , !: � , .�, ,� 40 Acre Dri l l Pattern Exa m ple • Chan n el Reservo ir Ave . 15-20 ft . High a n d 145-375 ft. Wide

Shore l i n e Rel ated Reservoir Ave. 2 0 ft. H igh a nd 1650 ft. Wide • Effective Porosity Ave. at Three Rivers is 9%

�N R.M:R RESERVOIRS ARE N�OW "ND COUPLEX

T h e sca led outcrop exa mple a bove high l ights sand bod ies d eposited i n a n e nvironment a nalogo us to that of the Three R ive rs a rea . Sand bod ies penetrated by the we l l bores 1320 feet a pa rt {40 acre spJclng) are h ighl ighte d in green while sand bod ies not penetrated a re

highl ighted ye l low a n d orange. This exa mp l e s h ows that m a n y hyd roca rbon charged sa n d

bod ies wou l d not b e prod uced by 4 0 a cre wel l dens ity. Oockel: 2014·02<1 Cause: Z70-0J

QEP Energy Company

Exh i b it G-S

Docket N o . : 2014-031

Cause N o . : 19 1-06

OO I P

liD ���.����r Origina l Oi l in P lace Per 640 Acres (MMBO)

tip. ,

26

35

2

1 1

14

23

i . - -I ! . � -

--lI- -

L4 - --..-.- ' ---, �- 7S I20E 22 23 1 9 20 21

, . _ -

29 28 Zl 2t'l. 2S I . -- , �RH-RIV-ERS 34-31-nO - - ------=;

- � G) I .. I -� � �� : ....,.. 3-( 35 · S6 1 t l _ I e • _ a ..--. � - - - 1 '\ -. ..... •

• I · ... 12 I 7 '" «. -4 � 3 , . II � .�io _I

- 1 -.... ! I i

1 1 13 18

- I 15 24 I Ii 14

1 2

1 3

- I I

3�S 3E29 21 22 25

N

��26�======�======��=-�_.�_�.�. ��_� __ �_��=����24� i Stale " 1 mile

EXHIBIT M-l

F in ley estimated that

Section 16 contains "'147 M M BOIP or "'9.2

M M BO I P/40 acres. Section

34 co ntains �120 M M BOIP

o r "'7.5 M M BO I P/40 acres. This ass u m es a n effective

porosity cutoff of 3 .5 %, an

oi l satu ration (So) of 45% which results in a tota l reservoir thickness (h) of

37 1' in Section 34 to 484' In section 16.

Ca lculated OOIP Averages ""133.5 MMBO/sec

OOIP Metrics Sw < 55% Phie > 3.5% Bo = 1.2 h = 371' to 484'

oocket: 2014·024 Ca US!!: 270-03

QEP Energy Company

Exh i bit G-6

Docket No . : 2014-03 1

Cause No . : 191-06

OO I P a n d Recove ry Facto r

liD �����,�:Y Origina l Oi l in P lace Per 640 Acres (MMBO)

�

2e

35

1 1

I.

23

26

1 -- , --� -.

1 9

1 2 I - - -

I - -1-13

. - -

24

25

7

I. • - - -+ i ' �,-- .. --• :;;;- -- 7S ',2QE 20 21 22 23

-- --I

29 29 27 25.

'- �RfE-.RIV�S-3 31-720- -.. � .. :- -yA 36 a- 34

- I .. ,\ • .... .. 1 -

- :4 1 • , � � . � 3 ..... � - -

18

- � t , -8 10 1 1

, THR£E RIVf �6-4 -710 '- __

,1 t · 0 · t • r 14 16 • I , S 19

1 _ . _ aS 20E t

318 8E 29 � 22 23

25

• ---

• 36

I

-T

12 r - ' I

1:,\

:<4

Scale " 1 mile

EXH I B IT M-2

Docket: 2D14�24 Cause: :170-03

QEP Energy Company

Exhibit E-1

Docket N o , : 2014-031

Ca use No. : 191-06