....
BARNWELL 1~'rA-rRIES, INC.
Water and Land Development Department of Land and Natural Resources State of Hawaii PO Box 373 Honolulu, Hawaii 96809
To Whom It May Concern:
May 15,2002
RE: Barnwell Geothermal Corporation Geothermal Resources Lease Bond for Geothermal Resources Mining Lease No. R-3
As per the attached cover letter from Marsh Inc., I am enclosing for your file the Change Rider for the above referenced lease, which changes the Reliance bond number from B 1829574 to the Travelers bond number 103635063. ~
Ilks
Enclosures
Sincerely,
~K.S~-Leslie K. Scott Executive Assistant
1100 Alakea Street. Suite 2900 • Honolulu, Hawaii 96813 • Telephone (808) 531-8400 • Fax (808) 531-7181
~
________________________________________ lIIK-.. "' ............
•
May 7, 2002
Mrs. Leslie Scott
o MARSH 745 Fort Street, Suite 1100, Honolulu, HI 96813
Post Office Box 4238, Honolulu, HI 96812 Ph. (808) 585-3525, Fax (808) 585-3511
WATER RESOURCES INTERNATIONAL, INC. 1100 Alakea Street, Suite 2900 Honolulu, HI 96813
Re: BARNWELL GEOTHERMAL CORPORA nON Lease Bond to the State of Hawaii .
Dear Leslie:
o
MARSH An AtMC Company
I must apologize of the delay in the 2001-2002 renewal of this bond. As you know, Travelers purchased Reliance Surety Company two years ago and began to convert Reliance bond numbers, which began with a "B" to Travelers bond numbers. Unfortunately, with this change, many bond renewals got lost in the shuffle and this bond was one of them.
I have finally got this matter straightened out with Travelers. Attached is the Change Rider which changes the Reliance bond number from B 1829574 to the Travelers bond number 103635063. ~ase submit this Rider to the State of Hawaii. Please retain the other Rider for your files ..
Also attached is Invoice Number 239328 in the amount of$200 for the 2001-2002 renewal ofthe bond. I have included a self-addressed remittance envelope for your convemence.
Leslie, once again, I apologize for the tardiness in the renewal ofthis bond. If you have any further questions, please do not hesitate to contact me:
- Direct Line: 585-3525 -Fax: 585-3511 - E-Mail: [email protected]
Thank you.
Sincerely,
~ - ~~--------------~ Arlene A. Tanaka Bond Department
Traveler5t o o
SURETY BOND RIDER
TO: STATE OF HAWAII WATER AND LAND DEVELOPMENT 1151 Punchbowl Street HONOLULU HAWAII 96813
RE: Bond Principal: Barnwell Geothermal Corporation Obligee: STATE OF HAWAII Surety Co: Reliance Insurance Company Surety Bond Number: B1829574 Bond Amount: $10,000.00 Type of Bond: Geothermal Resource Lease Bond
The purpose of this Rider is to:
[Xl CHANGE BOND NUMBER
Upon execution of this Surety Bond Endorsement by all parties hereto, surety bond number B1829574 is changed to 103635063.
[Xl CHANGE SURETY COMPANY
Effective August 15,2001, Travelers Casualty and Surety Company of America{"Travelers") replaces Reliance Insurance Company{"Reliance") as surety on the above referenced bond and, accordingly, agrees to be bound by the terms of the above-referenced bond and to perform all of Reliance's obligations thereunder as if the above-referenced bond had originally been issued by Travelers. The termination of liability under the Reliance bond is a condition precedent to the change of surety. Upon execution of this Surety Bond Endorsement by all parties hereto, Reliance shall have no further obligation or liability under the above-referenced bond.
o CONTINUATION CERTIFICATE
This certificate extends the life of the bond to . It is executed upon the express condition that the surety's liability under said bond, together with this and all previous continuation certificates, shall not be cumulative and shall in no event exceed the amount specifically set forth in said bond or any existing certificate changing the amount of said bond.
Signed, sealed and dated May 30, 2001.
Travelers Casualty and Surety Company of America
~. By: ________ _
Paull. Semanski, Vice Pres.
5-53530 6/00
Reliance Insurance Company
~o~~~,...c --"'"---By: __________________ ~ ____________ _
George W. Thompson, Attorney-in-Fact
Travelers Casualty and Surety Company of America, Hartford, Connecticut 06183 Travelers Casualty and Surety Company, Hartford, Connecticut 06183
Farmington Casualty Company, Hartford, Connecticut 06183
Please direct any questions or correspondence to: Travelers Bond, Bank of America Tower, SEATTLE, WA 98104 Attn: Sylvia J Whitman, (206) 386-5785, Fax (206) 386-5577
~~~--------------------------------~,,~".'-
A ..... II •• : PRODUCER
Karsh , KcLennan, Incorpo~4..EJ P. O. Box 38 Honolulu, HI 96810
INSURED
water Resources Int'l Inc 1100 Alakea st suite 2900 Honolulu, HI 96813
ANY AUTO
AU. OWIED AUTOS
SCt£OULED AUTOS
HIRED AUTOS
NON-OWIED AUTOS
GARAGE UASUTY
UABILITY
WORICER'8 COMPEN8A1ICN
OTI£R
AND
EMPLOYERS' UA8IJTY
PClUCY NUMBER
462978
DESCRIP110N OF OPERATlONSJUlCATJON8IVEI'ICLESCIAL ITEMS
A FIRST INSURANCE CO OF HI
NATIq!1Ni ~OPMENT
~ANYC
~ANYD
POUCY EFfEClNE DAlE (MM/OO/yy)
10/01/96 10/01/97
$
BOOl.Y IN.AJRY (Per perlOn) $
BOOIlY INJURY (per accldenll $
PROPERlY DAMAGE $
(SEE REVERSB AND/OR ATTACHED)
S~A~E OF HAWAII 1151 PUNCHBOWL S~RBB~ HONOLULU, HI 96813
SHOULD />N( Of THE AOOV£ DESCRIBED POUCIES BE CANCELLED BEFORE THE
EXPIRATION DATE THEREOF. THE ISSUING COMPANY wlLDUaU
MAIL ~ DAYS WRITTEN NOnCE TO THE CERTIFICATE HOLDER NAMED TO THE
LEFT.
AUTHORIZED REPRESENTATNE _&~.
DESCRIPTION OF OPERATIONS/LOCATIONS/VEHICLES/SPECIAL ITEMS
CE~~IFICATE #63400 (CONTINUED) DLW
INSURED: water Resources Int'l Inc
HOLDER STATE OF HAWAII 1151 PUNCHBOWL STREET HONOLULU, HI 96813
ADDITIONAL INSURED:
-
TAX MAP KEY:
1-3-45:9 1-3-45:10 1-3-45:14 1-3-45:16 1-3-45:17
1-3-45:25 1-3-45:22 1-3-45:21 1-3-4W8
1-l:-4~ .1-3-46&.3
'::r";'!-46: 4 :.!-a-4615 .. !.t"-4~13 " r -.]·-4 dIt 14 ·t-.~-4!15
"t,. "'.
~
STATE OF HAWAII, HAWAII STATE BOARD OF LAND AND NATURAL RESOURCES, CHAIRMAN OF THE BOARD OF LAND AND NATURAL RESOURCES, DEPARTMENT OF LAND AND NATURAL RESOURCES ARE ADDITIONAL INSUREDS FOR THE LOCATIONS DESCRIBED BELOW ONLY TO THE EXTENT SET FORTH IN THE GENERAL LIABILITY POLICY PROVISIONS.
LANDS SITUATE AT KAPOHO, KANIAHIKU, KEAHIALAKA AND POHOIKI, PUNA, HAWAII, BEING ALL OF THOSE CERTAIN PARCELS OF LAND (PORTIONS OF THE LAND DESCRIBED IN AND COVERED BY:
1. ROYAL PATENT 4497, LAND COMMISSION AWARD NO. 8559, APANA 5, TO C. KANAINA;
2. ROYAL PATENT GRANT NO. 3209 TO ROBERT RYCROFT; AND
3. LAND PATENT NO. 8094, LAND COMMISSION AWARD NO. 8559-B, APANA 15, TO WM. C. LUNALlLO DESIGNATED BY TAX MAP KEY AS FOLLOWS:
TAX MAP KEY:
1-3-46:60 1-3-46:61 1-3-46:62 1-3-46:63 1-3-46:64 1-3-46:65 1-3-46:66 1-3-46:67 1-3-46:68 1-3-46:69 1-3-46:70 1-3-46:71 1-3-46:72 1-3-46:73 1-3-46:74 1-3-46:29 1-3-46:30 1-3-46:33
PAGE: 2 OF
AREA:
3
o o DESCRIPTION OF OPERATIONS/LOCATIONS/VEHICLES/SPECIAL ITEMS
CERTIFICATE '63400
INSURED: water Resources Int'! Inc
HOLDER STATE OF HAWAII
1-3-46:16 1-3-46:17 1-3-46:18 1-3-46:19 1-3-46:20 1-3-46:21 1-3-46:22 1-3-46:23 1-3-46:24 1-3-46:25
1-3-46:76 1-3-46:78 1-3-46:79 1-3-46:81 1-3-46:82 1-3-46:84 1-3-46:52 1-3-46:53 1-3-46:54 1-3-46:55 1-3-46:56 1-3-46:57 1-3-46:58 1-3-46:59
1151 PUNCHBOWL STREET HONOLULU, HI 96813
1-3-46:34 1-3-46:35 1-3-46:36 1-3-46:37 1-3-46:38 1-3-46:39 1-3-46:40 1-3-46:41 1-3-46:42 1-3-46:43 1-3-46:44 1-3-46:45 1-3-46:46 1-3-46:47 1-3-46:48
1-3-46:49 1-3-46:50 1-3-46:51
1-3-08:06
1-3-08:07
1-3-08:19
1-3-09:07
1-4-01:20
PAGE:
(SUBTOTAL OF FOREGOING)
(PORTION)
3 OF 3
(CONTINUED)
77.0000 ACRES
140.0000 ACRES
160.2920 ACRES
227.5910 ACRES
119.1800 ACRES
45.0738 ACRES
DLW
PRODUCER
Harsh , HoLennan, P. O. Box 38 Honolulu, HI "810
96 DEC ~~ COMPANIES AFFORDING COVERAGE
="" A ZURICH AKBRICAN OP ILL.
~==~----------------~~~~~~~~ B AMERICAN RATIONAL PIRB ~er Resouroes Int'l I~O 1100 Alate. st suite 2'00 Honolulu, HI "813
THIS 18 TO CERTIFY ~T THE POLICIES OF INSURANCE USTED BElOW HAVE BEEN ISSUED TO TttE INSURED NAMED NJI:NE FOR THE POlICV'PERIOD',," INDICATED, NOTWITHSTANDING AMY REOUIaEMENT, TERM OR CONDITION OF N« CONTRACT OR OTHER DOCUMENT WITH RES~CT TO WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POUCIES DESQUBED HEREIN IS SUBJECT TO AlL THE TERMS, EXCLUSIONS AND CONDITIONS OF SUCH POUCIES. UMlTS SHOWN MAY HAVE BEEN REDUCED BY fWD ClNMS.
OTtER
10/01/95 10/01/9'
00M8N:0 SIN(U UMIT •
OWNEOAUT08 BOOl.Y INJURY {Per~) • BOOl. Y IN.AJRY • {Per MCidenll
PROPERTY IWIWlE •
(SEB REVERSB AND/OR ATTACHBD)
S~A~B OF HAWAII 1151 PUNCHBOWL S~RBBT HONOLULU, HI '6813
EXPIRATION DATE THEREOF, THE ISSUING COMPANY WI' DUDU MAIl--3J) DAYS WRITTEN NOTICE TO THE ~TIFICATE HOLDER NAMED TO THE
LEFT,
: AUTHORIZED AEPRESENTATNE
, DESCRIPTION OF OPERATIONS/LOCATIONS/VEHICLES/SPECIAL ITEMS
CERTIFICATE '63355 (CONTINUED) (, . DLW
INSURED: water Resources Int'l Inc • ,!
HOLDER : STATE OF HAWAII l' 1151 PUNCHBOWL STREET l. . HONOWW, HI 96813
LOCATIONS:
TAX MAP KEY:
1-3-45:9 1-3-45:10 1-3-45:14 1-3-45:16 1-3-45:17
1-3-45:25 1-3-45:22 1-3-45:21 1-3-45:18
1-3-4611 1-31:."46 1-3"4"", 1"'3"'"46:5
(~1"'l.."'4~3 .!\J ... 4 4 '1-3-4.15 , " . tIIQ"
:IL
'" ..
"
STATE OF HAWAII, HAWAII STATE BOARD OF LAND AND NATURAL RESOURCES, CHAIRMAN OF THE BOARD OF LAND AND NATURAL RESOURCES, DEPARTMENT OF LAND AND NATURAL RESOURCES ARE ADDITIONAL INSUREDS FOR THE LOCATIONS DESCRIBED BELOW ONLY TO THE EXTENT SET FORTH IN THE GENERAL LIABILITY POLICY PROVISIONS.
LANDS SITUATE AT KAPOHO, KANIAHlKU, KEAHIALAKA AND POHOIKI, PUNA, HAWAII, BEING ALL OF THOSE CERTAIN PARCELS OF LAND (PORTIONS OF THE LAND DESCRIBED IN AND COVERED BY:
1. ROYAL PATENT 4497, LAND COMMISSION AWARD NO. 8559, APANA 5, TO C. KANAINA:
2. ROYAL PATENT GRANT NO. 3209 TO ROBERT RYCROFT: AND
3. LAND PATENT NO. 8094, LAND COMMISSION AWARD NO. 8559-B, APANA 15, TO WK. C. LUNALlLO DESIGNATED BY TAX MAP KEY AS FOLLOWS:
TAX MAP KEY: AREA:
1-3-46:60 1-3-46:61 1-3-46:62 1-3-46:63 1-3-46:64 1-3-46:65 1-3-46:66 1-3-46:67 1-3-46:68 1-3-46:69 1-3-46:70 1-3-46:71 1-3-46:72 1-3-46:73 1-3-46:74 1-3-46:29 1-3-46:30 1-3-46:33
PAGE: 2 OF 3
o o DESCRIPTION OF OPERATIONS/LOCATIONS/VEHICLES/SPECIAL ITEMS
CERTIFICATE '63355 (CONTINUED) DLW
INSURED: water Resources Int'l Inc
HOLDER : STATE OF HAWAII
1-3-46:16 1-3-46:17 1-3-46:18 1-3-46:19 1-3-46:20 1-3-46:21 1-3-46:22 1-3-46:23 1-3-46:24 1-3-46:25
1-3-46:76 1-3-46:78 1-3-46:79 1-3-46:81 1-3-46:82 1-3-46:84 1-3-46:52 1-3-46:53 1-3-46:54 1-3-46:55 1-3-46:56 1-3-46:57 1-3-46:58 1-3-46:59
1151 PUNCHBOWL STREET HONOLULU, HI 96813
1-3-46 34 1-3-46 35 1-3-46 36 1-3-46 37 1-3-46 38 1-3-46 39 1-3-46 40 1-3-46:41 1-3-46:42 1-3-46:43 1-3-46:44 1-3-46:45 1-3-46:46 1-3-46:47 1-3-46:48
1-3-46:49 1-3-46:50 (SUBTOTAL OF 1-3-46:51 FOREGOING)
1-3-08:06
1-3-08:07
1-3-08:19
1-3-09:07
1-4-01:20 (PORTION)
PAGE: 3 OF 3
77.0000 ACRES
140.0000 ACRES
160.2920 ACRES
227.5910 ACRES
119.1800 ACRES
45.0738 ACRES
-) Q
BARNWELL GEOTHERMAL CORPORATION 1100 Alakea Street, Suite 2900
Honolulu, Hawaii 96813 (808) 531-8400 Telephone (808) 531-5171 Facsimile
~1r. ~lanabu Tagomori Manager-Chief Engineer State of Hawaii Department of Land and Natural Resources Division of Water and Land Development P. O. Box 373 Honolulu, HI 96809
Dear Mr. Tagomori:
June 17, 1994
Please find enclosed a copy of my letter to Mr. James A. Harkins at Resolution Credit Services Corporation regarding his inaccurate letter trying to cancel the well indemnity bonds for Lani Puna Geothermal Wells 1 and 6.
Marsh & McLennan agrees with us that these bonds are non-cancelable until the wells are abandoned.
If you have any questions please feel free to contact me at (808) 531-8400.
Sincerely,
Russell M. Gifford Vice President
RMG/rlhb
Enclosure
Q BARNWELL GEOTHERMAL CORPORATION
1100 Alakea Street, Suite 2900 Honolulu, Hawaii 96813
Mr. James J. Harkins Senior Vice President
(808) 531-8400 Telephone (808) 531-5171 Facsimile
June 17, 1994
Resolution Credit Services Corporation Embarcadero Center West Tower, Suite 1100 275 Battery Street San Francisco, CA 94111
Dear Mr. Harkins:
I am in receipt of your letter dated May 25, 1994 regarding your desire to cancel Lani Puna Geothermal Wells 1 and 6 geothermal resources well indemnity bonds.
Barnwell Geothermal Corporation ("BGC") understands that the well indemnity bonds for Lani Puna Geothermal Wells 1 and 6 are non-cancelable unless the wells have been, to the satisfaction and acceptance of the State of Hawaii, abandoned. Neither of these wells have been abandoned and your statement that "all . . . activities have ceased, and the above referenced wells therefore have been abandoned in fact" is not correct.
Therefore, your "cancellation" of these bonds is not effective and they continue in full force and effect. Additionally, BGC or Marsh & McLennan would appreciate the courtesy of being informed by your office, prior to any action in the future.
If you have any questions please contact me at (808) 531-8400.
Sincerely,
~'c...,~ Russell M. Gifford Vice President
RMG/rlhb
cc: Mr. Manabu Tagomori - State of Hawaii Mr. John Lettieri - Marsh & McLennan
JOHN WAIHEE 1l0VERNOR OF HAWAII
o
STATE OF HAWAII DEPARTMENT OF LAND AND NATURAL RESOURCES
DIVISION OF WATER AND LAND DEVELOPMENT
Mr. James J. Harkins Senior Vice President
P. O. BOX 373
HONOLULU. HAWAII 96809
JUN , 4 J99~
Resolution Credit Service Corporation Embarcadero Center, West Tower, Suite 1100 275 Battery Street San Francisco, California 94111
Dear Mr. Harkins:
LANI PUNA GEOrnERMAL WEU..S 1 AND 6 , BARNWEll. GE01HERMAL CORPORATION
KErn! W. AHUE, CHAI!tPERSON
BOARD OF LAND AND NATURAL RESOURCES
DEPUTIES
JOHN P. KEPPELEA. " DONA L. HANAIKE
AQUACULTURE DEVELOPMENT PROGRAM
AQUATIC RESOURCES CONSERVATION AND
ENVIRONMENTAL AFFAIRS CONSERVATlQN AND
RESOURCES ENFORCEMENT CONVEYANCES FORESTRY AND WilDLIFE HISTORIC PRESERVATION LAND MANAGEMENT STATE PARKS WATER AND LAND DEVelOPMENT
Thank you for your May 24, 1994 letter informing us of your intent to cancel the two $50,000 indemnity bonds for the subject wells.
Contrary to your understanding, Geothermal Resource Mining Lease R-3, issued to Barnwell Geothermal Corporation, which is still in effect, and our Administrative Rules, require that the bonds remain in force for the life of the wells and may not be cancelled until the wells are properly abandoned. Therefore, the bonds for Lani Puna 1 and 6 must remain in effect until the wells have been properly plugged and abandoned and site restored, as reasonably as possible to their original conditions.
Should you have any questions, please contact Mr. Gordon Akita of my staff at (808) 587-0227.
HY:ek c: Barnwell Geothermal Corp.
R~'4/~('4-
I o Q
RESOLUTION CREDIT SERVICES CORP. * ~4 JUN 6
May 25,
state of Hawaii Department of Land & Natural Resources Division of Water and Land Development P.O. Box 373 Honolulu, Hawaii 96809
A 9: 43
Re: principal: Barnwell Geothermal Corporation surety: Industrial Indemnity Company Bond No. YS845-7457 Geothermal Resources Well
Lanipuna *1, TMK: 1-3-9:7 Bond No. YS845-8885 Geothermal Resources Well
Lanipuna *6, TMK: 1-3-9:7 Bond Penal Sums: $50,000.00 Each Bond
Gentlemen:
EMBARCADERO CENTER
WEST TOWER, SUITE 1100
275 BATTERY STREET
SAN FRANCISCO, CA 94111
(415) 773-6600
WRITER'S DIRECT DIAL:
FAX:
Please note that Resolution Credit Services Corporation is the managing agent for Industrial Indemnity Company surety bonds including the two referenced above.
As to the referenced bonds and wells we understand that the above permits have expired, all drilling operations and activities have ceased, and the above referenced wells therefore have been abandoned in fact. Industrial Indemnity as surety therefore gives notice that it is cancelling the above-captioned goethermal resources well indemnity bonds effective July 1, 1994.
Very truly yours,
. Harkins Vice President
JJH:psc
Enclosures
a:\52594barn.jjh
A MEMBER OF THE RESOLUTION GROUP, INC. 'Formerly Industrial Indemnity Financial Corp.
c/o Resolution Credit Services Corporation
Address 275 Battery Street, Suite 1100 San Francisco, CA 94111
" Industrial Indemnity ~ a Crum _net Forst., Ofq.JnlzdttOn
NOTICE OF CANCELATION
State of Hawaii Date May 25, 1994 Department of Land & Natural Resources Division of Water and Land Development P.O. Box 373 Honolulu, Hawaii 96809
Gentlemen:
PLEASE TAKE NOTICE that this company elects to cancel the underrnentioned bond in
accordance with its terms and conditions, cancelation to be effective as indicated below.
Bond No. YS845-7457 Amount S 50,000.00
Principal: Barnwell Geothermal Corporation
Address: c/o 2828 Paa Street Honolulu, Hawaii
Kind of Bond: Geothermal Resources Well Indemnity Bond No. Lanipuna #1, TMK: 1-3-9:7
Cancelation to be effective thirty (30) days from receipt of Notice of Cancelation.
cc: Barnwell Geothermal Corporation Marsh & McLennan, Inc.
1 V035 R2 (6/821
Attomey·jn·t"act
o ~c/o ResolutW Credit Services Corporation
Address 275 Battery Street, Suite 1100 San Francisco, CA 94111
a~ Industrial Indemnity • Crum .... FOIl ..... OfCltlfttldilOft
NOTICE OF CANCELLATION
State of Hawaii Date 11a y 25, 1994
Department of Land & Natural Resources Division of Water and Land Development
P.O. Box 373 Honolulu, Hawaii 96809
Gentlemen:
PLEASE TAKE NOTICE that this company elects to cancel the undermentioned bond in
accordance with its terms and conditions, cancelation to be effective as indicated helow.
Bond No. YS845-8885 Amount S 50,000.00
Principal: Barnwell Geothermal Corporation
Address: c/o 2828 Paa St. Honolulu, Hawaii
Kind of Bond: Geothermal Resources Well Indemnity Bond Well No. Lanipuna #6, TMK: 1-3-9:7
Cancelation to be effective thirty (30) days from receipt of Notice of Cancellation.
cc: Barnwell Geothermal Corporation Marsh & 1.1cLennan, Inc.
, Y035 R2 (6/621
Attomey·in·t'act
JOHN WAIHEE
GOVERNOR OF H~WAII
STATE OF HAWAII DEPARTMENT OF LAND AND NATURAL RESOURCES
REF:WRM-LN
Mr. Marty L. Jokl President Barnwell Geothennal Corporation 2828 Paa Street, Suite 2085 Honolulu, Hawaii 96819
Dear Mr. Jokl:
P. O. BOX 621
HONOLULU. HAWAII 96809
NOV 5 f991
WILLIAM W. PATY. CHAIRPERSON
BOARD OF LANO AND NATURAL RESOURCES
DEPUTIES
KEITH W. AHUE MANABU TAGOMORI
DAN T. KOCHI
AOUACULTURE DEVELOPMENT PROGRAM
AOUATIC RESOURCES CONSERVATION AND
ENVIRONMENTAL AFFAIRS CONSERVATION AND
RESOURCES ENFORCEMENT
CONVEYANCES FORESTRY AND WILDLIFE HISTORIC PRESERVATION
PROGRAM LAND MANAGEMENT STATE PARKS WATER RESOURCE MANAGEMENT
The Department of Land and Natural Resources acknowledges the receipt of your request for extension of Geothennal Resource Mining Leases (GRML) R-3.
Mining lease GRML R-3, Section 3(B), provides that if at the expiration of the primary tenn geothennal resources in commercial quantitites are not being produced from the leased lands, but the Lessee is actively engaged in drilling operations designed to drill below the depth of 1,000 feet, or, to a production zone at a lesser depth in a diligent manner, that Lease shall be continued for so long thereafter as such operations are continued with no cessation of more than 180 days, but not to exceed a period of five (5) years, and if such drilling operations are successful, as long thereafter as geothennal resources are being produced or utilized in commercial quantities except for the 65-year limit of the lease.
The Department has reviewed your earlier exploration activity conducted under mining lease R -3 and your current plans for exploration! development proposed between Barnwell and Morgan Oil Ltd. of Kentucky. We have no objections to your proposal to conduct further exploration activity within the mining lease area, or to your plans to apply for all applicable permits necessary to undertake this effort.
Accordingly, a five-year extension of lease R-3 beyond the primary 10-year tenn is hereby granted subject to all applicable tenns a the lease. The new expiration date of mining lease GRML R-3 shall e August 10, 1996. Should you have any questions, please contact Manabu Tagomori, Deputy , a -~ . ....
Sincerely,
WILLIAM W. PAlY
cc: Division of Land Management
• o a BARNWELL GEOTHERMAL CORRC9.BerPlOJ'J
Mr. Manabu Tagomori Deputy Director state of Hawaii
July 8, 1991
Dept. of Land & Natural Resources P.O. Box 373 Honolulu, Hawaii 96809
Dear Mr. Tagomori:
91 JUl' p4: 51
DiV. OF V/ATER & l AttD DEVtLOPMENT
Barnwell Geothermal Corporation ("BGC") has engaged in the exploration for geothermal resources within the County of Hawaii, having drilled a total of three geothermal test wells and one side track from one of the wells. Of the four drilling efforts, three were drilled within the lands demised by the state Geothermal Lease, R-3. In particular, BGC drilled the Lani Puna 1 well, a side track to that well and later drilled the Lani Puna 6 well. As a result of this drilling, which occurred during a four year period ending in late 1984, BGC determined that while the Lani Puna 1 well and its side track were quite hot, neither intersected the fractures necessary to make the well productive. The Lani Puna 6 well encountered a zone of extremely high permeability, but at too Iowa temperature to make it useable as a producing well. However, the depth of the permeable zone makes the Lani Puna 6 well an excellent candidate for use as an injection well.
There has been a significant delay since the completion of the Lani Puna 6 well, during which time we have worked to lay the ground work necessary to continue further exploration. In particular, we at BGC have analyzed the likely resource and worked with other parties to develop a rational plan for continued exploration. Having- completed a significant initial exploration program, during which BGe discovered many features of the geothermal resource within the state Geothermal Lease including a likely injection site, and with the work done after our last drilling effort, BGC is now prepared to begin a second phase of exploration within R-3.
During the last year and a half, BGC has worked with Morgan Oil, Ltd. ("MOL"), a Kentucky company engaged in natural gas exploration and development, to reach an agreement to continue the exploration for geothermal resources within the lands demised by the state Geothermal Lease, R-3. BGC and MOL have reached substantial agreement on the form of a working relationship and, to date, the two companies have expended well in excess of $100,000 in engineering and legal fees.
2828 PAA STREET, SUITE 2085 • HONOLULU, HAWAII 96819 • TELEPHONE (808) 839-7720' TELEX 7238672 • TELECOPIER (808) 833-5577
I.
Mr. Manabu Tagomori July 8, 1991 Page 2
o
While working towards the agreement, BGC and MOL strove to develop a sound strategy for further exploration within the state Geothermal Lease. Enclosed with this letter are (1) a reservoir analysis performed by Geothermex, Inc., clearly setting forth the very high likelihood of commercial geothermal production from within R-J, (2) a drilling plan, setting forth a prudent well design consistent with the known reservoir characteristics, and (J) a well testing and evaluation plan. Under the planned agreement, MOL will be appointed the Operator. MOL has begun the preparation of the applications for all permits necessary for the drilling of a geothermal well. Each of the permits, when complete, the County of Hawaii Geothermal Resource Permit, the Authority to Construct from the state Department of Health, together with the Geothermal Plan of Operations and the Geothermal Well Drilling Permit to be submitted to your department, will show that MOL plans to drill a test hole as soon as it receives all necessary permits.
Given the SUbstantial work performed within the lands demised by the state Geothermal Lease, the detailed planning completed during the last year and a half, the continuing efforts and desire to commence drilling operations as soon as possible, we request that the Department of Land and Natural Resources extend the R-J lease so that we can continue to explore and develop a viable geothermal resource.
Enclosures
MLJ/rz
cc: Charles L. Culton
Sincerely,
/~t!:r- ? ,/j( Martin L. k; President
.D o
Paul WII.s.~ (9.e~/a:;'srf) P'/tJ7an ~/I Ce" L-fd. P3(J. £wcltd Av<-.
[e;x,n7-nn I K-e#'f~~~ ¥t:J£:C2-
(~b") u,8"- 32.lf-o
o TO ________________________________ __
DATE __________ T1ME ___ _
WHILE YOU WERE OUT M ________________________________ _
of ____________________________________ __
Phone ________________________________ ___
TELEPHONED 'LEASE CALL
CALLED TO SEE YOU WILL CALL AGAIN
WANTS TO SEE YOU URGENT
I RETURNED YOUR CALL 1 I -
Message ______________________________ __
OJ)tfltor
o o JOHN WAIHEE
GOVERNOR OF r"i'!~ • r ,._
DEi;t~:~:,.'~ .~ C(, TIe,.. ·-iJ.;.~; '~';~~-:J""
SfP Jj B 43 IiH '90
REF:WL-MH
STATE OF HAWAII DEPARTMENT OF LAND AND NATURAL. RESOURCES
P. O. BOX 621
HONOLULU, HAWAII 96809
5EP '2 191)
MEMORANDUM
TO:
ATIN:
FROM:
SUBJECf:
Honorable Warren Price III, Attorney General
Johnson Wong, Supervising Deputy Att~ey eneral Land!Transportation Division
William W. Paty, Chairperson
Approval as to Fonn of the Perfonnance Bond for Geothennal Resource Mining Lease R-3
--1 fT'1
,,::-;t r -l'j ':~'::":"
1---0-7" ..... )--1 7- ~ rbi.
4'J-(g 3f WILLIAM W. PATY CHAIRPERSON
BOARD OF LAND ANj+lATURAL RES(OURCES I '
~PUTIES . )\. v KEITH w. AHUE ~
MANABU TAGOMORI 'V RUSSELL N. FUKUMOTO ~'
AQUACULTURE DEVELOPMENT PROGRAM
AQUATIC RESOURCES CONSERVATION AND
ENVIRONMENTAL AFFAIRS CONSERVATION AND
RESOURCES ENFORCEMENT CONVEYANCES FORESTRY AND WILDLIFE LAND MANAGEMENT STATE PARKS WATER AND LAND DEVELOPMENT
~~ii" •... '.,' .. \
,'" W' .•.. ~.,' ,
,of"I' " ... ,
rn e,..") u:,"
Transmitted for your review and approval as to fonn is the required Geothennal Resource Mining Lease Perfonnance Bond submitted by Barnwell Geothemal Corporation in compliance with our Department's Administrative Rules, Section 13-183-34.
Please note that while the language contained in Section 13-183-34 asks for the submittal of a bond on a fonn approved by the Board, no such "generic" version of a bond has been utilized by the Department. However, the Department has no objections to the current body of language contained in this bond, which is similar to other perfonnance bonds previously submitted and approved.
Your review of the enclosed bond and the return of the original document to our Division of Water Resource Management will be appreciated. Should you have any questions, please contact Manabu Tagomori at Ext. 87533.
Thank you for your continued assistance and cooperation.
DN:mh
Enclosure
,- o o STATE OF HAWAII
DEPARTMENT OF LAND AND NATURAL RESOURCES
GEOTHERMAL RESOURCE LEASE PERFORMANCE BOND
KNOW All MEN BY THESE PRESENTS:
Bond No. B 1829574 Executed One (1)
That we Barnwell Geothermal Corporation, as PRINCIPAL, and
_____ Re __ 11_·a_n_c_e __ I_n_s_u_r_a_n_c_e __ C_o_m.p_a_ny~ ___ , as SURETY, organized and doing business
under and by virtue of the laws of the STATE OF Pennsylvania andlor authorized
to do business in the STATE OF HAWAII, are held and firmly bound unto the
STATE OF HAWAI I and the Occupier of the land covered by Lease hereinafter
described, in the sum of Ten Thousand and No/IOO -------------------~-----
($ 10,000.00 ), lawful money of the UNITED STATES OF AMERICA, to be paid to
the STATE OF HAWAI I, BOARD OF LAND AND NATURAL RESOURCES, for which payment,
we bind ourselves, our heirs, executors, successors and assigns, jointly and
severally, firmly by those present.
The conditions of the foregoing obligation is such tha~ if the above
bounded PRINCIPAL shall comply with the provisions of GEOTHERMAL RESOURCES
MINING LEASE NO. _______ R-_3 _______ , Regulation NO.8 relating to Leasing of
Geothermal Resources and applicable laws of this State, then this obi igation
s h a I I be v 0 i d i 0 the r wi s e, tor ema i n i n f u I I for c e and e f f e ct.
AND, IT IS HEREBY STIPULATED AND AGREED:
1. That any change, extension or alteration permitted by said Lease,
regulation or laws of the State shal I not in any way affect the obI igat ion of
said Surety on this bond; and that said Surety does hereby waive notice of
any such change, extension or alteration. , ,
• 2. That suit on this bond may be brought before a court of competent
jurisdiction without a jury, and that the sum of sums specified in said lease
as I iquidated da~ages shall be considered as, and held to be, fixed and
I iquidated damages which shall be forfeited to the State of Hawaii, its
successors or assigns, in the event of a breach of any, or all, or any part
of, the stipulations, agreements, covenants or conditions contained in said
contract or in this bond, in accordance with the terms hereof.
3. That this bond shall also inure to the benefit of the Occupier of and
the I ease d I and /a n y and a I I per son sen tit led to f i I e c I aims for I abo r
performed or material furnished in said work so as to give such Occupier(s) a
right of action against said PRINCIPAL and SURETY and so as to give any and
all persons a right of action as contemplated in Section 507-17, Hawai i
Revised Statutes.
WITNESS our hands and seals at Honolulu State of
______ ~H~a~w~a~i~i _______ , this __ ~1~5~t~h~ __ day of ___.....;;.A;;;,;:u;.c;g""'u;;;,;:s;.,;:t"--___ , 19 9~.
PRINCIPAL: BARNWELL GEOTHERMAL CORPORATION
APPROVED AS TO FORM: By: 1fMt:. I
SURETY: RELIANCE INSURANCE COMPANY
By: Its Attorney-in-Fact, Brent Olson
STATE OF HAWAI I ) CITY AND COUNTY) SS:
OF HONOLULU )
INDIVIDUAL ATTORNEY-IN-FACT ACTING FOR CORPORATION
On this 15th day of August 19 90 before me personally appeared Brent Olson to me personally known, who, being by me duly sworn, did say that he is the Attorney-In-Fact of Reliance Insurance Company duly appointed under Power of Attorney, dated 3/8/90 , which said Power of Attorney is now in force and effectl and that the foregoing instrument was executed in the name and behalf of said Reliance Insurance Compan~ by said
Brent Olson as its Attorney-in-Fact, and said Brent Olson acknowledged said instrument to be the
free act and deed of said corporation.
,.~~~ ~ry Public, ~ My Commission Expires: 5/6/94
$I ,0;44 ',P )"i $EX < 2_, JJSM'&".#Hti,;;;'; Ai!,APi9¢A44 i4 Mt ! £.:;;:4.4$4 4.1t t ,&44,-44 ,; " 14j14::1 "
· ,. , , RELI~CE INSURANCE C~MPANY
W HEAD OFFICe. PHILADELPHIA. PENN8YLVA'tM!
POWER OF ATTORNEY KNOW ALL MEN BY THESE PRESENTS. That the RELIANCE INSURANCE COMPANY. a corporation duly organized under the laws of the State of Pennsylvania. does hereby make. constitute and appoint
BRENT OLSON of HONOLULU, HAWAII -------------
ita true and lawful Attorney-in-Fact. to make. execute. seal and deliver for and on ita behalf. and as its act and deed
ANY AND ALL BONDS AND UNDERTAKINGS OF SURETYSHIP -------
and to bind the REUANCE INSURANCE COMPANY thereby as fully and to the same extent as If such bonds and undeftakings and other writings oblililatory in the nature thereof were signed by an Executive Officer of the REUANCE INSURANCE COMPANY and sealed and atteated by one other of such ,)fIIeera. and hereby ratifies and confirms all that ita said Attorney(s)-in-Fact may do in pursuance hereof. "
This Power of Attorney is granted under and by authority of Article VII of the By-Laws of REUANCE INSURANCE COMPANY which became effective September 7.1978. which provisions are now in full force and e"act. reading as follows:
ARTICLE VII - EXECUTION OF BONDS AND UNDERTAKINGS
1. The Board of Directors. the President. the Chairman of the Board. any Senior VIce President. any VIce President or Assistant Vice President or other officer designated by the Board of Directors shall have power and authority to <a) appoint Attorneys-in-Fact and to authorize them to execute on behalf of the Company. bonds and undertakings. recognizances. contracts of indemnity and other writings obligatory in the nature thereof. and (b) to remove any such Attorney-in-Fact at any time and revoke the power and authority given to him.
2. Attorneys-in-Fact shall have power and authority. subject to the terms and limitations of the power of attorney issued to them. to execute and deliver on behalf of the Company. bonds and undertakings. recognizances. contracts of indemnity and other writings obligatory in the nature thereof. The corporate seal la not necessary for the validity of any bonds and undertakings. recognizances. contracts of indemnity and other writings obligatory In the nature thereof.
3. Attorneys-in-Fact shall have power and authority to execute affidavits required to be attached to bonds. recognizances. contracts of indemnity or other conditional or obligatory undertakings and they shall also have power and authority to certify the financial statement of the Company and to copies of the By-laws of the Company or any article or section thereof.
This power 0' attorney is signed and sealed by facsimile under and by authority of the following Resolution adopted by the Board of Directors of REUANCE INSURANCE COMPANY at a meetingheld on the 5th day of June. 1979. at which a quorum was present. and said Resolution has not been amended or repealed:
"Resolved. that the signatures of such directors and officers and the seal 0' the Company may be affixed to any such power of attorney or any certificate relating thereto by facsimile. and any such power 0' attorney or certificate bearing such facsimile Signatures or facsimile seal shall be valid and binding upon the Company and any such power so executed and certified by facsimile signatures and facsimile seal shall be valid and binding upon the Company in the future with respect to any bond or under1aking to which It is attached."
IN WITNESS WHEREOF. the REUANCE INSURANCE COMPANY has cau~ these presents to be signed by Its Vice President. and its corporate seal to be hereto affixed. this 8th day of March 19 9 Q
REUANCE INSURANCE COMPANY
~~ \P!d:t STATE OF Washington COUNTY OF King On this 8 th day of
} ss.
March .1990. personally appeared Lawrence W. Carlstrom
to me known to be the Vice-President of the REUANCE INSURANCE COMPANY. and owledged that he executed and attested the foregoing instrument and affixed the seal of said corporation thereto. and that Article VII. . 1. 2. an 3 of the By-Laws of said Company and the Resolution. set forth therein. are still in full force.
My Commission Expires:
February 23.19 93
Residing at Tacoma I. Robert D. Ri tzhaupt . Assistant Secretary of the RELIANCE INSURANCE COMPANY. do hereby certify that the above and foregoing is a true and correct copy of a Power of Attorney executt'd by said REUANCE INSURANCE COMPANY. which is still in full force and effect
IN WITNESS WHEREOF. I have hereunto set my hand and affixed the seal of said Company this 15th day of August 19 90.
"'_t~~~ Robert D:Ritaupt IIOf'-1431 Ed. 6/79
I o o JOHN WAIHEE
GOVERNOR OF HAWAII
WILLIAM W. PATY. CHAIRPERSON
BOARD OF LAND AND NATURAL RESOURCES
REF:WL-MH
STATE OF HAWAII DEPARTMENT OF LAND AND NATURAL RESOURCES
P. O. BOX 621
HONOLULU. HAWAII 96809
SEP 12 1990
MEMORANDUM
TO:
ATTN:
FROM:
SUBJECT:
Honorable Warren Price III, Attorney General
Johnson Wong, Supervising Deputy Atr{0 ey eneral Land/Transportation Division
William W. Paty, Chairperson
Approval as to Form of the Performance Bond for Geothermal Resource Mining Lease R-3
DEPUTIES
KEITH W. AHUE MANABU TAGOMORI
RUSSELL N. i"UKUMOTO
AQUACULTURE DEVELOPMENT PROGRAM
AQUATIC RESOURCES CONSERVATION AND
ENVIRONMENTAL AFFAIRS CONSERVATION AND
RESOURCES ENFORCEMENT CONVEYANCES FORESTRY AND WILDLIFE LAND MANAGEMENT STATE PARKS
WATER AND LAND DEVELOPMENT
Transmitted for your review and approval as to form is the required Geothermal Resource Mining Lease Performance Bond submitted by Barnwell Geothernal Corporation in compliance with our Department's Administrative Rules, Section 13-183-34.
Please note that while the language contained in Section 13-183-34 asks for the submittal of a bond on a form approved by the Board, no such "generic" version of a bond has been utilized by the Department. However, the Department has no objections to the current body of language contained in this bond, which is similar to other performance bonds previously submitted and approved.
Your review of the enclosed bond and the return of the original document to our Division of Water Resource Management will be appreciated. Should you have any questions, please contact Manabu Tagomori at Ext. 87533.
Thank you for your continued assistance and cooperation.
DN:mh
Enclosure
A.~.tlilt .. PRODUCER
CODE
INSURED
MARSH " lkI.ENNA.N. INC. P. O. BOX 38 HONOLULU, HAWAII 96810
SUB-CODE
BABNWILL GEO'tBIIQIAL COIl'OlAnON 282.8 FAA SftUr. SVITi 12085 HONOLULU, iJAW.&.II 96819
ISSUE DATE (MM/DD/YY)
7-24-90 csk:ey THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER. THIS CERTIFICATE DOES NOT AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE POLICIES BELOW
COMPANY A LETTER
COMPANY B LETTER
COMPANY C LETTER
COMPANY D LETTER
COMPANY E LETTER
COMPANIES AFFORDING COVERAGE
PACIFIC INSURANC1& COMPANY. LIMITED
THIS IS TO CERTIFY THAT THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED, NOTWITHSTANDING ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS, EXCLUSIONS AND CONDITIONS OF SUCH POLICIES. LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS.
CO LTR TYPE OF INSURANCE
GENERAL LIABILITY
A X COMMERCIAL GENERAL LIABILITY
CLAIMS MADE X OCCUR.
OWNER'S & CONTRACTOR'S PROT.
AUTOMOBILE LIABILITY
ANY AUTO
ALL OWNED AUTOS
SCHEDULED AUTOS
HIRED AUTOS
NON-OWNED AUTOS
GARAGE LIABILITY
EXCESS LIABILITY
WORKER'S COMPENSATION
AND
EMPLOYERS' LIABILITY
OTHER
POLICY NUMBER POLICY EFFECTIVE POLICY EXPIRATION DATE (MM/DDIYY) DATE (MMIDDIYY)
10 UElI ZlU286 10/01/89 10/01/'0
70 JUiU ZD5Z41 10/1/8' 10/1/90
ALL LIMITS IN THOUSANDS
GENERAL AGGREGATE $ 1,000 PRODUCTS·COMPIOPS AGGREGATE $ 1.000 PERSONAL & ADVERTISING INJURY $ 1,000 EACH OCCURRENCE $ 1,000 FIRE DAMAGE (Anyone fire) $
MEDICAL EXPENSE (Anyone person) $
COMBINED SINGLE LIMIT
BODILY
$
INJURY $ (Per person)
BODILY INJURY $ (Per accident)
100 10
EACH AGGREGATE OCCURRENCE
$ 1,000 $ 1,000
STATUTORY
$
$
$
(EACH ACCIDENT)
(DISEASE-POLICY LIMIT)
(DISEASE-EACH
DESCRIPTION OF OPERATIONSILOCATIONSNEHICLESIRESTRICTIONSISPECIAL ITEMS LOCA.'rIOJlS: SEE 4'lTACIIID
STAD 01' JW1A1I, IlAWAII S'UTI IOAID 0' LAND AID MTUIW. USOtJI.C&S. JJWUQ) 01' LAID AIm »A'tUJW. DIlAa'J:MBllT 01' LAD AD IIATUI.AL RESOUJ.CIS
SUD 01' HAWAII 1151 l'tlKBIOWL STIDT B.O.IOLULU, BA.V4l1 96813
ACORD25-S
SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE THE
EXPIRATION DATE THEREOF, THE ISSUING COMPANY WILL~
MAIL -30- DAYS WRITTEN NOTICE TO THE CERTIFICATE HOLDER NAMED TO THE
LEFT,
AUTHORIZED
CQRPORATION
Lands o:'uate at Kapoho, Kaniahiku, Ohialaka and Pohoiki, Puna, Hawaii, being all of tfiose certain parcels of land (portion~of the land described in and covered by:
1. Royal Patent 4497, Land Commission Award No. 8559, Apana 5, to C. Kanaina1
2. Royal Patent Grant No. 3209 to Robert Rycroft; and
3. Land Patent No. 8094, Land Commission Award No. 855 9-B I Apana 15, to W~. C'. Luna1i10 designated by Tax Map Key as follows:"
TAX MAP KEY TAX MAP KEY AREA
1~3-45!9 1-3~46:60 1-3-45:10 1-3-46161 1-3-45:14 1-3-46:62 1-3-45:16 1-3-46 :,63 1-3-45:17 1-3-46:64
1-3-45:25 1-3-46165
,l-3-46i66 1-3-45:22 1-3-46: 67 ' 1-3-45:21 1-3~46:68 1-3~4S:19 1-3-46:69
1-3-46:70 1-3-46:2 ,1-3-46:71 1-3-46:3 1-3-46:72 1-3-46:4 1-3-46:73
1-3-46:5" 1-3-46:74 1-3-46:13 1-3-46:29 1-3-46:14 1-3-46:30 1-3-46:15 1-3-46:33 1-3-46:16 1-3-46:34 1-3-46:17 1-3';"46:35 1-3-46:18 1-3-46:36 1-3-46:19 1-3--46:37 1-3-46:20 1-3;,.411:38 1-3-46:21 1-3-46:39 1-3-46:22 1-3-46:40 1-3-46:23 1-3'-46: 41 1-3-46:24 1-3-46:42
1":'3-4 Ii : 43 1-3-46:25 1-3-46:44
1-3-46:1$ 1-3-46:45 1-3-46: 78"' 1-3-46:4G / i
1-3':"46:47 I
1-3-46:79 I
1-3-46:81 1-3-46': 48 1-3-46:82 ' " !- 1-3-46:49 1-3-46:84 1-3-46:52 :,': ,.. 1-3-46:50 (Subtotal of
.'.'
1-3-46:53 1-~-46:51 foregoing) 77.0000 acres 1-3-46:54 1-3-46:55 1-3-08:06 140.0000 acres 1-3-40:56 1-3-46:51 1-3-08:07 160.2920 acres 1-3-46:58 1-3-46:59 1-3-0a:19 227.5910 acres
1-3':"09:07 119.1800 acres
1':'4-0-1:20 (portion) 45.0738 acres
TOTAL , 769.1368 acres
" \
.;. ' -.' .. -
t ,~.
RELI~CE INSURANCE COMPANY V HEAD OFFICE, PHILADELPHIA. PENN8YLV ... O
POWER OF ATTORNEY KNOW ALL MEN BY THESE PRESENTS. That the REUANCE INSURANCE COMPANY. a corporation duly organized under the laws of the Stale of Pennsytvania, does hereby make.· constitute and appoint .
BRENT OLSON of HONOLULU, HAWAII -------------
its true and lawful Attorney-in-Fact, to make. execute. seal and deliver for and on its behalf. and as ita act and deed
ANY AND ALL BONDS AND UNDERTAKINGS OF SURETYSHIP -------.
and to bind the REUANCE INSURANCE COMPANY thereby as fully and to the same extent as If such bonds and undertakings and other writings obIi\latory in the nature thereof were signed by an executive Officer of the REUANCE INSURANCE COMPANY and sealed and attested by one other of 8UCh .)fIIeers; and hereby ratifies and confirms atl that its said Attorney(s)-in-Fact may do in pursuance hereof.
This Power of Attorney is granted under and by authority of Atticle VII of the By-Laws of REUANCE INSURANCE COMPANY which became effective September 7. 1978. which provisions are now in full force and effect, reading as follows: ~
ARTICLE VU - EXECUTION OF BONDS AND UNDERTAKINGS
1. The Board of Directors. the President. the Chairman of the Board. any Senior VIce President. any VIce President or Assistant VICe President or other officer designated by the Board of Directors shall have power and authority to (a) appoint Attorneys-in-Fact and to authorize them to execute on behalf of the Company. bonds and undertakings. recognizances. contracts of indemnity and other writings obligatory in the natura thereof. and (b) to remove any such Attorney-in-Fact at any time and revoke the power and authority given to him.
2. Attorneys-in-Fact shall have power and authority. subject to the terms and limitation. of the power of attorney issued to them. to execute and deliver on behalf of the Company. bonds and undertakings. recognizances, contracts of indemnity and other w~ng. obligatory In the nature thereof. The corporate seal is not necessary for the validity of any bond. and undertakings, recognizances. contracts of indemnity and other writings obligatory In the nature thereof. .
3. Altomeyl-in-Fact shall have power and authority to execute affidavits required to be attached to bonds. recognizances. contracts of indemnity or other conditional or obligatory undertakings and they shall also have power and authority to certify the financial statement of the Company and to copies of the By-laws of the Company or any article or section thereof.
This power of attorney is signed and sealed by facsimile under and by authority of the following Resolution adopted by the Board of Directors of REUANCE INSURANCE COMPANY at a meeting hald on the 5th dey of Juna. 1979. at which a quorum was present. and said Resolution has not been amended or repealed:
"Resolved. that the signatures of such directors and officers and the seal of the Company may be affixed to any such power of attorney or any certificate relating thereto by facsimile. and any such power of attorney or cet1ificate bearing such facSimile signatures or facsimile seal shall be valid and binding upon the Company and any such power so executed and certified by facsimile Signatures and faCSimile seal shall be valid and binding upon the Company in the future with respect to any bond or undertaking to which It is attached."
IN WITNESS WHEREOF. the REUANCE INSURANCE COMPANY has cau~ these presents to be signed by its VICe President. and its corporate seal to be hereto affixed. this 8 th day of March 19 9 U
REUANCE INSURANCE COMPANY
ti?l6::~~ . President
STATE OF Washington COUNTY OF King On this 8 th day of
} ss.
March .1990'personallyappeared Lawrence W. Carlstrom
to me known to be the Vice-President of the REUANCE INSURANCE COMPANY. and owledged that he executed and attested the foregoing instrument and affixed the seal of said corporation thereto. and that Article VII. Sectiol'i 1. 2. an lion. set forth therein. are still in full force.
My Commission Expires:
February 23.19 93
Residing at Tacoma I, Robert D. Ri tzhaupt . Assistant Secretary of the RELIANCE INSURANCE COMPANY. do hereby certify that the above and foregoing is a true and correct copy of a Power of Attorney executEld by said REUANCE INSURANCE COMPANY. which is still in full force and effect.
IN WITNESS WHEREOF. I have hereunto set my hand and affixed the seal of said Company this 15 t h day of Au gu s t 19 90 .
... -.--~;Q~ Robert D. Rlt aupt
1lOR·1431 Ed. 6/79
t o o STATE OF HAWAII
DEPARTMENT OF LAND AND NATURAL RESOURCES
GEOTHERMAL RESOURCE LEASE PERFORMANCE BOND
KNOW ALL MEN BY THESE PRESENTS:
Bond No. B 1829574 Executed One (1)
Tha t we Barnwell Geothermal Corporation, as PR I NC I PAl, and
_____ Re __ 11_·a_n_c_e __ I_n_s_u_r_a_n_c_e __ C_o_m6P~a~ny'_ ___ , as SURETY, organized and doing business
under and by virtue of the laws of the STATE OF Pennsylvania and/or authorized
to do business in the STATE OF HAWAII, are held and firmly bound unto the
STATE OF H.AWAII and the Occupier of the land covered by lease hereinafter
described, in the sum of Ten Thousand and No/lOO ----------~--------------
U 10,000.00 ), lawful money of the UNITED STATES OF AMERICA, to be paid to
the STATE OF HAWAI I, BOARD OF LAND AND NATURAL RESOURCES, for which payment,
we bind ourselves, our heirs, executors, successors and assigns, jointly and
severally, firmly by those present.
The conditions of the foregoing obligation is such that if the above
bounded PRINCIPAL shall comply with the provisions of GEOTHERMAL RESOURCES
MINING LEASE NO. _________ R_-_3 ________ , Regulation No.8 relating to Leasing of
Geothermal Resources and applicable laws of this State, then this obi igation
shall be void; otherwise, to remain in full force and effect.
AND, IT IS HEREBY STIPULATED AND AGREED:
1. That any change, extension or alteration permitted by said lease,
regulation or laws of the State shall not in any way affect the obligation of
said Surety on this bond; and that said Surety does hereby waive notice of
any such change, extension or alteration. , l
---------------------:..'------------------------..... ~ ... ,--.-"
o o 2. That suit on this bond may be brought before a court of competent
jurisdiction without a jury, and that the sum of sums specified in said lease
as liquidated damages shal' be considered as, and held to be, fixed and
I iquidated damages which shall be forfeited to the State of Hawaii, its
successors or assigns, in the event of a breach of any, or al" or any part
of, the stipulations, agreements, covenants or conditions contained in said
contract or in this bond, in accordance with the terms hereof.
3. That this bond shall also inure to the benefit of the Occupier of
the leased land any and all persons entitled to file claims for labor
performed or material furnished in said work so as to give such OccupierCs) a
right of action against said PRINCIPAL and SURETY and so as to give any and
all persons a right of action as contemplated in Section 507-17, Hawaii
Revised Statutes.
WITNESS our hands and seals at _______ H_o~n~o~1u __ 1u ________ State of
_______ H;;aw~a~i~i _______ , this 15th day of ____ ~A~u~gu~s~t~ _____ , 1991L--.
PRINCIPAL: BARNWELL GEOTHERMAL CORPORATION
;APPROVED AS TO FORM:
SURETY: RELIANCE INSURANCE COMPANY
Deputy Attorney General By: Its Attorney-in-Fact, Brent Olson
I
o
STATE OF HAWAII) CITY AND COUNTY ) SS:
OF HONOLULU )
o
INDIVIDUAL ATTORNEY-IN-FACT ACTING FOR CORPORATION
On this 15th day of August 19 90 before me personally Bppeared Brent Olson to me personally known, who, being by me duly sworn, did say that he Is the Attorney-In-Fact of Reliance Insurance Company duly appointed .under Power of Attorney, dated 3/8/90 , which said Power of Attorney Is now In force and effect, and that the foregoing Instrument was executed In the name and behalf of said Reliance Insurance Company by said
Brent Olson as Its Attorney-In-Fact, and said Brent Olson Icknowledged slid Instrument to be the
free act and deed of said corporation.
~1Hd~~:.4. L./1fot8fy Public, t;~f Hlwall My Commission Expires: 5/6/94
o o BARNWELL GEOTHERMAL CORP0RA!T:I&N
- -........ .. ' ....... ;"_..1
Mr. Manabu Tagomori Deputy Director state of Hawaii Dept. of Land & Natural Resources P.O. Box 621 Honolulu, Hawaii 96809
Dear Mr. Tagomori:
"-,; t Ii 11 8; 5 5
Enclosed please find a new designation of resident agent for each of the Well Indemnity Bonds, numbers YS 845-7457, YS 845-8885, and 872109. Also, each of the bonds has been countersigned by the resident agent as requested.
Please do not hesi tate to contact me should any further action be required on these bonds.
enclosures
MLJ/rz
Sincerely,
7(4/jIJ Martin L. Jokl President
2828 PAA STREET, SUITE 2085 • HONOLULU, HAWAII 96819 • TELEPHONE (808) 839-7720· TELEX 7238672 • TELECOPIER (808) 833-5577
JOHN WAIHEE
GOVERNOR OF HAWAII
o o
STATE OF HAWAII DEPARTMENT OF LAND AND NATURAL RESOURCES
Mr. Martin L. Jokl, President Barnwell Geothennal Corporation 2828 Paa Street, Suite 2085 Honolulu, Hawaii 96819
Dear Mr. Jokl:
P. O. BOX 621
HONOLULU. HAWAII 96809
April 16, 1990
WILLIAM W. PATY. CHAIRPERSON
BOARD OF LAND AND NATURAL RESOURCES
DEPUTIES
KEITH W. AHUE MAN ABU TAGOMORI
RUSSELL N. FUKUMOTO
AQUACULTURE DEVELOPMENT PROGRAM
AQUATIC RESOURCES CONSERVATION AND
ENVIRONMENTAL AFFAIRS CONSERVATION AND
RESOURCES ENFORCEMENT CONVEYANCES FORESTRY AND WILDLIFE LAND MANAGEMENT STATE PARKS WATER AND LAND DEVELOPMENT
The Department of Attorney General has reviewed the bonds submitted by Barnwell Geothennal Corporation and Geothennal Exploration & Development Corporation (GEDCO), and has identified several matters requiring your attention.
Geothennal Resources Well Indemnity Bond Nos. YS 845-7457, YS 845-8885, and 872109 require notarized signatures by a Hawaii Resident Agent.
Enclosed are the original documents which have been signed and approved as to fonn by the Deputy Attorney General. However, please note that this prior approval is dependent upon the aforementioned conditions being satisfied. If the above requirements are not met, the Deputy Attorney General's signature shall be considered invalid.
Please have these documents signed and completed as required. Should you have any questions, please contact George Matsumoto 548-7619!
DN:ln Encl.
truly yours,
o o Corporate
STATE OF HAWAII ) CITY & COUNTY OF HONOLULU ) S8:
)
On this 18th day of August • 19~. before me appeared E. C. Craddick
to me personally known. who, being by me duly sworn, did say that _________ _ he is president
of BARNWELL GEOTHERMAL CORPORATION • and that the seal affixed to the foregoing instrument is the corporate seal of said corporation and that said instrument was signed and sealed in behalf of said corporation by authority of its Board pf Directors, and the said __ =E~.~C~.~C=r~a~d~d~1~·c~k~-----------------~aclmowledged said instrument to be the free act and deed of said corporation.
State of Hawaii City &
County of Honolulu
YOlO RoC ('/721
~ SS.
~~~~~~~---:-_e...!:> Notary Public, Judicial Circuit
State of Hawaii I()...O (1J My Commission Expires:~C_-,r,-l:.2...T_
On August 16, 1982 , before me, the undersigned, .a Notary Public of said county and state, personally appeared
John T. Lettieri known to me to be the Attorney-in-Fact of
INDUSTRIAL INDEMNITY COMPANY the Corporation that executed the within instrument, and know~ to me to be the person who executed the said instrument on behalf of the Corporation therein named, and acknowledged to me that such Corporatio executed the sam . •
. ,
o o
GEOTHERMAL RESOURCES WELL INDEMNITY BOND ($50,000 Individual Well Bond)
KNQt.,r ALL MEN BY THESE PRESENTS:
BOND NO. YS 845-7457 Executed 2
That we BARNWELL GEOTHERMAL CORPORATION --~==~==~==~====~~~~~~-----------------------------------------
as principal; and INDUSTRIAL INDEMNITY COMPANY ----~~====~~~~~~~~~---------------------------------------
organized and existing under and by virtue of the laws of the STATE OF HAWAII and authorized
to transact surety business in the STATE OF HAl-lAII, as surety, are held and firmly bound unto .
the State of Hawaii in the full and just sum of FIFTY THOUSAND AND NO/IOO DOLLARS ($50,000.00)
lawful money of the United States of America, to be paid to the said State of Hawaii, for which
payment, well and truly to be made, we do hereby bind ourselves, our heirs, executors, administr.
tors, successors and assigns, jointly and severally, firmly by these presents.
Signed, sealed, delivered and dated this 16th day of August , 19~8~2~_, at Honolulu, City and County of Honolulu, State of Hawaii.
THE CONDITION OF THE ABOVE OBLIGATION IS SUCH THAT,
WHEREAS, said principal is. about to acquire, drill, redrill, deepen, operate, maintain or
abandon a geothermal resources well designated as Well No. Lanipuna #1 TMK: 1-3-9:7
Latitude _______________ , Longitude __________________ , Island of ___ H_a_w_a_i_i ______ and is
required to file this bond in connection therewith in accordance with Rule 9.4 of Regulation 8
of the Department of Land and Natural Resources, State of Hawaii.
NOW, THEREFORE, if said BARNWELL GEOTHERMAL CORPORATION the above bounden principal, shall well and truly comply with all the provisions of said Regulation 8 and shall obey all lawful orders of the Chairman of the Board of Land and Natural Rrsources, or his representative, if not appealed to the Board of Land and Natural Resources, or cpon affirmance thereof by the Board of Land and Natural Resources, if appealed thereto, and shall pay all charges, costs, and expenses incurred by the Chairman or his representative, in respect of such well or the property or properties of said principal, or assessed against such well or the property or properties of such principal, in pursuance of the provisions of said Regulation 8, then this obligation shall be void; otherwise, it shall~emain in full force and effect.
Approved as to form:
Dp.,ted:
BARNWELL GEOTHERMAL CORPORATION -=~~==~~~==~~~~~~~~--------------Principal
E. C. Craddick It. Presid nt
INDUSTRIAL INDEMNITY COMPANY Surety
By: (----~~----~~--------~~-----------
Its: ,John T. Lettieri
o J0tnrr of ~ttorllry 111156 I 'i i) C ' : f· I \ I
• 1) i ' .. r l
HOME OFFIC:E - SAN FR ANC:ISC:O
That J:\IH-S I R.I.\!. I:\I>E\I:\IT'I" CO:\II'.\:\Y. a corporation on;anized and existinl( lmdcr th(' laws oJ' Ihe St.ltl· of California. and havinl( its prill( ip;t! "ificl.' in the City "f San Francisco, State of California. c10es herehy make. constitute .lI1d .lpl'OInt
-------------------------------------JOBN T. LETTIERI-----------------------------______ _ it~ true and lawful attorney-ill-fact for it and ill its name, place and stead to execute on its behalf as surety. blind" IIlldcrtakinl{~. stipu-lations. consents and all ullltracts of suretyship and to attach its corporate seal to such ohligations ill fdv\)r oJ' .1I! tlhli.;ees. providcd that the liability of the Company ,IS surety under his authority in no one instance shall exceed the sum of
-----------------------------------------UNLIHITED---------------------------------------and rcsen'ing to itself full po\\cr of suhstitution and revocation. This Power of ,\ttorney is made and executed in accordance with the Resolution adopted by the Buard of Directors of
I :\Dl'STRL\L IND":MNITY COMPANY at a meeting held on the 27th day of September. 1972. reading as follows: "RESOLVED. that the Chairman of the Board or President or Executive Vice President or Senior Vice President ()ilhc Company.
in conjum:tion with the Secrc:tary or an .\ssistant Secretary of this Company. he and he herehy is authorized to Cxc\·ute. acknowledge or n:rify Powers of Attorney qualifying selccted attorneys·in·fact to act under such Powers of Attorney to exelute on behalt of IIII.Justrial Indemnity Compau)' honds. undertakings. stipulations. consents and all contracts of suretyship. and tt> altai'll the corporate se;,1 thereto;
"RESOLVED. FURTHER. that the signatures of said officers so authorized hy this Company may he !,rinted tau.mile, litho· olraphed or otherwise produced. and that the facsimile signature of any person who shall have been such offii:er of thili Cumpany at the time of such execution. acknowledgment or verification may continue to be used for the purvose hereinaho\'c stated and will be binding on this Company. notwithstanding the fact that he may have ceased to be such offker at the time when 5udl instruments shall hc issued."
In witness whereof, INDUSTRIAL INDfo:MNITY COMPANY has caused these presents to be signed and its wrJHlrate seal to be affixed by its proper officers. at the City of San "'rancisco. California, this 18th day of February • 19 82
INDUSTRIAL INDE~INITY CU~II''':-':Y
L. E. Kulryan, Secretary 8y~~~~~~~~~~ J. G. President
SlATE OF CALI FOR!,;IA t CITY A:-JD COU~TY OF SA!'; FRA;\lCISCO ~ 55.
Un this 18th day of February .1982. before !'Ie. Mary Mueller oJ lIutary public ill and for the Cuy and County of Sail francisco. State of California. personally appeared
J. G. LaPlante and L. E. Kulryan
known to me to be the Senior Vice President and Secretary of the corporation whit'h cxefuted the within instrument. and acknowledged to me that such corporation exenlted thc same. dnd that the resolution Teft-rred to in the preceding instrument is 1l true and correct copy of the resolution duly passed at a meeting of the Board of Directors on Septemher 27. ]972. and that the WDC is in full force and effect.
In witness whereof, I have hereto.tet my hand and affixed my official seal the day and year in this ('crtil'icate first ahove written. . ./
lan_ ]JEIlI.II .,.:uEWI ' --- .~ em I ~ OF SAIl ...asco Mr C. '1I1Ift> ......... 3 •• , ._ .......... - and for the City and Cou'iliY""
cisco. State of California
I. L. E. Mulryan, Secretary of I;\iDUSTRI,\1. 1:\I>DI:'-lITY Cm.IPA:'\Y. do herd>)' certify that I havc compared the Power of Attorney granted herein and the Resolution rccitl."d herein with the originals now on file in the principal office of said Company. and that the same arc correct transcripts therefrom and of the whole of the said oril{inals. and that said Power of :\ttorney has not been revoked but is still in full force and effect.
In witness whereof. I havc h('reunto subscribed my name as such officer and affixed the seal of I~JlI_·STRL\1. I:,\DJ-::\INITY
CO:\IPA="r .it the City of San Francisco. California. this 16th day of August • J 9 82 .
SE.\L
Secretary
tvn .. , "" 'tn/,."
________________________________________________________ """+' ·0'_'
73-9 o o State of Hawaii
DEPARTMENT OF LAND AND NATURAL RESOURCES
DESIGNATION OF AGENT
In compliance with Rule 8.2 of Regulation 8 of the Department of Land and
Natural Resources, notice is hereby given and I hereby certify that I (1, we) -(""'1 -, -w-e)"-
E. C. Craddick Name (s)
representing BARNWELL GEOTHERMAL CORPORATION (OWNER-OPERATOR) (firm or corporation)
of _--AHwI.lQ"",mwQ~ll~] .... J.IoI]] __ ' State of _-.QH.c:IaUAW,""auj..lj~ ___ , have appointed, authorized and (CitY>
empowered BARNWELL GEOTHERMAL CORPORATION (name of designee)
whose address is 2828 Paa St., Suite 2085, Hen.« Hi 96819 , State of Hawaii,
as our agent in the State of Hawaii * (my, our) ---------------------
who shall be the repository for all well records for each geothermal well drilled by
us , and upon whom all orders, notices and processes under the provisions of (me, us)
said Regulation 8 may be served.
This notice supersedes all previous designations made for the above-described
purposes.
IN WITNESS WHEREOF I have signed is certificate this 18 th day of (I, we)
Augus t , 19 ~2
, Witness: ~ ?t. ~ ~~
Na
NOTE: An owner or operator may appOint himself as agent.
*Should the owner or operator filing this form choose to appoint more than one agent, the phrase, "State of Hawaii" should be deleted and the exact area for w'hich the agent is to be appointed should be inserted. A separate form must be fileq for each agent.
Rule 8.2. Designation of Agent. Any person who has drilled, is drilling, or proposes to drill any geothermal well shall designate on forms provided by the Department an agent who shall be a resident of the State of Hawaii and upon whom may be served all orders, notices, and processes of the Department or any court of law. Every person so appointing an agent shall, within five days after the termination of any such agency, notify the Chairman in writing of such termination, and unless operations are discontinued, shall appoint a new agent. All changes in the address of an agent must be recorded with the Chairman within five days of the change of the address.
o o Corporate
STATE OF HAWAU ) CITY & COUNTY OF HONOLULU ) 88:
)
On this 2nd day of August • 19JiL, before me appeared E. C. CRADDICK'~---:"';';;:'-"=;"";:""'---
to me personally known. who. being by me duly sworn, did say that ___ ---",,\ ____ _ he is president
of WATER RESOURCES INTERNATIONAl. INC , and that the seal affixed to the foregoing instrument is the corporate seal of said corporation and that said instrument was signed ~ sealed in behalf of said corporation by authority of its Board pf Directors, and the said E. C. CBADDICK . acknowledged said instrument to be the free act and deed of said corporation.
-ru--.......,blic, ' Judicial Circuit
SeQ Hawaii C ~/ /!. My Commis ion Expires: ~ - T" /' i-
,--,-------------------------=----
STATE OF HAWAII ) ) ss:
CITY & COUNTY OF HONOLULU )
On this 29th day of~ _ __:;:.J.:::u.=.ly.L.._ ______ , 19~, before me
appeared John T. Lettieri , to me personally known, who, being by me duly sworn, did say that he is the Attorney-in-fact of the
INDUSTRIAL INDEMNITY COMPANY , a corporation of the State of California , duly appointed under Power of Attorney dated the 18th day of February , 19 82 , which power of attorney is now in full force and effect; and that the seal affixed to said instrument is the corporate seal of said corporation and that said instrument was signed on behalf of said corporation under the authority of its Board of Directors and said John T. Lettieri acknowledges said instrument to be the free a and deed of s id co poration.
Notary My comm
bIie, State of_Hawaii sion expires: 11/16/84
~----.. -j
o ./ o BOND NO. YS 845-3885
GEOTHE~IAL RESOURCES HELL INDB-1NITY BOND ($50,000 Individual Well Bond)
KNOtol ALL ~lEN BY THESE PRESENTS:
That we BARNWELL GEOTHERMAL CORPORATION
as principal; and INDUSTRIAL INDEMNITY COMPANY
organized and existing under and by virtue of the laws of the STATE OF HAHAII and authorized
to transact surety business in the STATE OF BAHAII, as surety, are held and firmly bound unto
the State of Hawaii in the full and just sum of FIFTY THOUSAND AND NO/lOO DOLLARS ($50,000.00)
lawful money of the United States of America, to be paid to the said State of Hawaii, for which
payment, ~ell and truly to be made, we do hereby bind ourselves. our heirs. executors, administr.
tors, successors and assigns, jointly and severally, firmly by these presents.
Signed. sealed, delivered and dated this 29th day of ____ ~J~u~lyL_ ____ • 19 83 • at Honolulu. City and County of Honolulu, State of Ha,.,aii.
THE COXDITION OF THE ABOVE OBLIGATION IS SUCH THAT,
WHEREAS, said principal is about to acquire, drill, redrill, deepen, operate, maintain or
abandon a geothermal resources well designated as lolell No .Lanipuna IF~ THK:---'I=--..... 3o!..-~9'-';w7 ______ _
Latitude 19°28'44" , Longitude _-=1:.:5;...:4_0.:::5.:::3_'~O.::.3_" _____ , Island of Hawaii and is
required to file this bond in connection therewith in accordance with Rule 9.4 of Regulation 8
of the Department of Land and Natural Resources, State of Ha,vaii.
NOtol, THEREFORE, if said BARNWELL GEOTHERMAL CORPORATION , the above bounden principal, shall well and truly comply with all the prov1s10ns of said Regulation 8 and shall obey all lawful orders of the Chairman of the Board of Land and Natural ~esources, or his representative, if not appealed to the Board of Land and Natural Resources, 01 ~lpon affirmance thereof by the Board of Land and Natural Resources, if appealed thereto, and ~hal1 pay all charges, costs, and expenses incurred by the Chairman or his representative, in respect of such well or the property or properties of said principal, or assessed against such well or the property or properties of such principal, in pursuance of the provisions of said Regulation 8, then this obligation shall be void; othen"ise, it shall_ remain in full force and effect.
GEOTHERMAL CORPORATION Principal
By:
Approved as to form: Its;
INDUSTRIAL INDEMNITY COMPANY Su'ret
Deputy By:
Dated; Its; John T. LettierO
o J0htrr of ~ttorltru 111156
itullht all l111'lt hu tl~l'Sl' }Jrl'5l'lltS:
o INDUSTRIAL
INDEMNITY
HOME OFFICE SAN FRANCISCO
'lhat l:\lJ('SIRI.\1. 1:\111'.\1:-:11\ cO:'>JI',\'\',.1 (orl'0r.ltlOI< "",,'IlI7.<'d .lllel t'xislil"~ IIlldn Ihl' L,ws of the St.,tl' "I C,tliforttl,l. and havin~ ih l"ill"i".01 ·>lTI,T ill Iht' eli)' of San hll" i,,< o. State "I' C.alifllrl1!.t. does hncbv 1ll.lke. l'lJllslillilc ,'Ilt! "l'l'otlll
-------------------------------------JOHN T LETTIERI its true .ll,d I.lwful attorlleY'Il-Ltd lor it ,lilt! ill its n;'llIe. pl"ce :'~ld stt'at! to l'Xl'~:-~~;:~i~I:.h::if:;_~;;~~~i::7;;;i:-.-;7;;;i~~~;k;:7;;~;;~;1 lations. t-onsents and ,Ill ,_'olllra('ts of sllretyshil' and to attath its l'C)rl'orate se.oI to such ohligations in f.I\or 01 ,011 ,,j.li,<\n·s. l'ro~ided that Ihe liability of the Company <IS surety under his authority ill 110 one instance' shall exceed the sum of
-----------------------------------------UNLIMITED----------------------------__________ _ and reserving 10 Itself full power of substitution and revoc.ttion,
This Power of Attoruey is made and executed in accordance with the Resolution adopted hy the l!o:lrd of Directors of I],;DL'STRL\L I!\1DEM~ITY COMP_\~Y at a meeting held on tht' 27th day of September. 197:!. reading as follows:
"RESOLVED. that the Chairm:1Il of the Board or President or Executive Viee Prcsidelll or Senior Vice Preside!]l of tht' Comp:IIIY. in conjunction with the Secretarv 01 ,\11 ,\ssistant Secretary of this Company, he and he hereby is authorized to cxecute. .,,'knowledge or verify Powers of Attorney qu.t1ifyin~ selected attorneys-in-bet to act under such Puwers of :\ttorllt:y to executl' "n \l('half of Industrial Indemnity CompaJlY bOl1d~, undert"kings. stipulations, consents and all cuntracts of suretyship. and tl< altach the corpoLlte seal thereto;
"RI::SOLVED. FURTHER. that the signatures of said officers so authurized hy this Company may he printed facsimile. lithographed or otherwise produced. and that the facsimile si,l\nature of "ny person who shall have heen such officer of this (:ompany al the time of such execution. acknowledgment or verification may continue to he IIsed for the purpose hereinahovc sl.tted and will he binding on this Company, notwithstallding the fal'! that he may h:lve ceased to be such officer at the time when stH h instruments shall be is'med."
In witness whereof. I~DUSTRL\L INllEl\.lNITY COMPA~Y has caused these presents to he signed ,1I1l1 its ",.rpm.He seal to be
affixed by its proper officers. at the City of San Francisco. California. this 18th day of February . 19 82
STATE OF C:\LIFOR~IA t CITY A:"I1l COU;'>;TY OF SAN FR:\~CISCO \ ss.
Un this 18th day of February
d notary public ill and for the City and County of San J. G. LaPlante
INDlISTRL\L 1~[)EII.Il\:ITY CO:\IP,\:'I:Y
Secretary
. 1982 . hefore !ne. Mary Mueller
Francisco, State of California. personally appeared and L. E. Mulryan
known to me to he the Senior Vice President and Secretary of the l:Urporation which executed the within instrument. and ~Icknowlcdged to me that such corporation exentled the ~ame. and th.lt the resolution referred to in the preceding instrument is 'a true and correl·t copy of the resolution duly pas~ed at a meeting of the Board of Directors on September 27.1972. and that the same is in full force and effect.
In witness whereof. I have hereto set my hand and affixed my official seal the day and year in this certificate first aho\'e written.
~-=-';··MU;;-·I . NOTARY PUBUC -CALIFORNIA !
CITY & COUIIIY Of SAN FRANCISCO ! My COIIIIIIiaion Expires Aut. 3, 1983 •
............ HI ••• U ••• H.J.~l ..... UI ••• I ••• a.; ..... 1
~, Notary I'uh c' 1 and for theCity amT(:oli~
of Sal Fr' ncisco. State of California
t. L. E. Mu 1 ryan , Secretary of l~lHJSTRIAL l~!)Dl~ITY COl\lPAl\:Y. do herehy certify that I have compared the Power of Attorney granted hereill and the Resolution recited herein with the originals now on file in thc principal office of said Company. ,lIId that the same are corred transcripts therefrom and of the whole of the said originals. ,md that said Power of ,\ttorney has not heen revoked bill is still in full force and effect.
In witt1cs~ whereof. I have hereunto suhscrihed my name as such offin'r and affixed the seal of 1:-':I>lJSTRIAL I:\1DE:\INITY
COlI.lrANY at the City of San Francisco. California. this 29th day of July , 1983
Lb<0 .. ' u ryan tJ..=, ~--~c~_~ ~ ~~ Secrctary
SEAL
tvnJlt Al7 110/7'"
______________________________________________________________ '!f.'III"'''~'_
\_~ ..--:...-.~" o o r-!
STATE OF HAWAII } CITY & 88.:
COUNTY OF HONOLULU
On this ........... J§.1;h.~ ..... ~~~ .. ~.day _ .. ~ ..... ~ .... ~~ ... ~~~~.~ .... ~~ ..... J.~Il,~~~~y.~~~~.~~~~ .. ~ ...... ~~~~.~ ...... ~~~ ........ 19 .. ~Q .... , before me personally came
M. G. Chillingworth .... _ .......... _ ........................................................................... -_ ....................................... _ ............................................. _ .......... _ ............................................................................ . to me known to be an Attorney-in-Fact of SEABOARD SURETY COMPANY, the corporation described in the within instrument, and he acknowledged that he executed the within instrument as the act of the said SEABOARD SURETY COMPANY in accord ce with autrco.ty y conferred upon him by said Company. .
ublic, State of Hawaii
FonnUI y ·c~~~~i;;i;~·~·E~~ir~~~--)F·a;.t()··Nota::;:y·I;~·b"iic~· ~ ...
r
• l .....
_ J
---------------------_ ...•. _.
o o 78-9
BOND NO. 872lO9
GEOTHERMAL RESOURCES WELL INDEMNITY BOND ($50,000 Individual Well Bond)
KNOW ALL MEN BY THESE PRESENTS:
That we GEOTHERMAL EXPLORATION & DEVELOPMENT CORP.
as principal; and SEABOARD SURETY COMPANY, a New York Corporation
organized and existing under and by virtue of the laws of the STATE OF HAWAII and authorized
to transact surety business in the STATE OF HAWAII, as surety, are held and firmly bound unto
the State of Hawaii in the full and just sum of FIFTY THOUSAND AND NO/lOO DOLLARS ($50,000.00)
lawful money of the United States of America, to be paid to the said State of Hawaii, for which pay
ment, well and truly to be made, we do hereby bind ourselves, our heirs, executors, administra
tors, successors and assigns, jointly and severally, firmly by these presents.
Signed, sealed, delivered and dated this 16th day of __ J_a_nu_a_ry __ 19~, at Honolulu, City and County of Honolulu, State of Hawaii.
THE CONDITION OF THE ABOVE OBLIGATION IS SUCH THAT,
WHEREAS, said principal is about to acquire, drill, redrill, deepen, operate, maintain or
abandon a geothermal resources well designated as Well No.1, TMK: 1-3-01: 24 ----Latitude , Longitude , Island of Hawaii and is --------------- --------------- -------------required to file this bond in connection therewith in accordance with Rule 9.4 of Regulation 8
of the Department of Land and Natural Resources, State of Hawaii.
NOW, THEREFORE, if said GEOTHERMAL EXPLORATION & DEVELOPMENT CORP. the above bounden principal, shall well and truly comply with all the provisions of said Regulation 8 and shall obey all lawful orders of the Chairman of the Board of Land and Natural Resources, or his representative, if not appealed to the Board of Land and Natural Resources, or upon affirmance thereof by the Board of Land and Natural Resources, if appealed thereto, and shall pay all charges, costs, and expenses incurred by the Chairman or his representative, in respect of such well or the property or properties of said principal, or assessed against such well or the property or properties of such principal, in pursuance of the provisions of said Regulation 8, then this obligation shall be void; otherwise, it shall remain in full force and effect.
By:
Its:
SEABOARD SURETY COMPAHY
Surety
By: 7.~ :=s Its: Attorney-in-fact
And By:
Its:
o o
STATE OF HAWAII City & County of Honolulu ss
On this 16th
E. C. Craddick
day of _______ J_an_ll_a_r....:y ____ , 19 80 , before me appeared
and --------------------------------- ---------------------------to me personally known, who, being by me duly sworn, did say that they are the
President and ---~~~~~----------------- ------------------------respecti vely, of __ G_e_o_th_e_rma __ l_E_x_p_l_or_a_t_i_o_n_&_D_e_V_e_lo_pm_e_n_t_C_o_r_p_. _______ _
and that the seal affixed to the foregoing instrument is the corporate seal of said
corporation, and that the foregoing instrument was signed and sealed in behalf of
said corporation by authority of its Board of Directors, and said _______ _
E. C. Craddick and --------------------- --------------------------------acknowledged the foregoing instrument to be the free act and deed of said corpora
tion.
My commission expires: 11/16/80
STATE OF HAWAII ss
On this ____ day of ____________ ' 19_, before me appeared
and -------------------- ----------------------to me personally known, who, being by me duly sworn, did say that they are the
and ---------------------------- ----------------------------respectively,of ________________________________________ ___
and that the seal affixed to the foregoing instrument is the corporate seal of said
corporation, and that the foregoing instrument was signed and sealed in behalf of
said corporation by authority of its Board of Directors, and said ________ _ ___________________________ and ___________________________________ _
acknowledged the foregoing instrument to be the free act and deed of said corpora
tion.
Notary Public,· _______ Judicial Circuit, State of Hawaii
My commission expires:
Ccrt ificd Copy
No. %84 POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS: That SEABOARD SURETY CO:\IPANY. a corporation of the State of New York. has made. constituted and appointed and by these presents does make. constitllte and appoint _______________ _ M. G. Chilling\o/orth or II. W. Chillingworth or Ronald Poepoe or June Kukino or Hilliam B. Steven or M. J. Singlehurst-------------------------------~--------------------------------------------of Honolulu, Hawaii its true and lawful Attorney-in-Fact, to make. execute and deliver on its behalf insurance policies. surety bonds. undertakings and other instruments of similar nature as foJlows: Hi thout Limitations.
Such ins~rance policies. s~ret!' bonds. unde:takings and instruments for said purposes •. when duly executed by the aforesaid Attorney-m-Fact. shall be bmdmg upon the said Company as fully and to the same extent as If signed by the duly authorized officers of the Company and sealed with its corporate seal; and all the acts of said. Attorney-inFact. pursuant to the authority hereby given. are hereby ratified and confirmed.
This appointment is made pursuant to the following By-Laws which were duly adopted by the Board of Directors of the said Company on December 8th. 1927. with Amendments to and including April 6. 1978 and are still in full force and effect:
ARTICLE VII, SECTION 1: "Policies. bonds. recognizances. stipulations. consents of surety. underwriting undertakings and instruments relating thereto.
Insurance policies, bonds, recognizances, stipulations, consents of surety and underwriting undertaking;; of the Company, and releases. agreements an( other writings relating in any way thereto or to any claim or loss thereunder. shall be signed in the name and on behalf of the Company
(a) by the Chairman of the Board, the President, a Vice President or a Resident Vice President and by the Secretary, an Assistant Secretary a Resident Secretary or a Resident Assistant Secretary; or (b) by an Attorney-in-Fact for the Company appointed and authorized by the Chair man of the Board, the President or a Vice President to make such signature; or (c) by such other officers or representatives as the Board rna: from time to time determine.
The seat of the Company shall if appropriate be affixed thereto by any such officer, Attorney-in-Fact or representative."
IN WITNESS WHEREOF. SEABOARD SURETY COl\IPA~Y has caused these presents to be signed by one of its Vice Presidents. and its corporate seal to be hereunto affixed and duly attested. by one of its Assistant Secretaries. this ... ;n~t ........ . day of ......... ~.~~.~~X ........................... 19.?~ .. .. Attest:
(Seal) Margaret Scofield
SEABOARD SURETY COMPANY.
By Thomas P. Gorke
Assistant Secretary Vice-Preside!
STATE OF NEW YORK I COUNTY OF. NEW YORK 5 ss. :
On this .. ~.~~.~ ..................... dai of ............................ :!.~~~~.ry' ................................................ 19 .. ?? ....... before me personally appeare ...................... Th9.~~.~ ... ~.~ ... 9.~?; ... ~ ................................................................. a Vice-President of SEABOARD SURETY CO~IP.\X\ with whom I am personally acquainted, who. being by me duly sworn. said that he resides in the State of .... ~~~ ... ~~.~~.~.Y ........... . that he is a Vice-President of SEABOARD SURETY COl\IPANY,' the corporation described in and which executed the fon going instrument; that he knows the corporate seal of the said Company; that the seal affixed to said instrument is such corporat seal; that it was so affixed by order of the Board of Directors of said Company; and that he signed his name thereto as Vic( President of said Company by like authority.
(Seal)
State of New York No. 41-7493475 Qualified in Queens County Cert. filed in New York County Commission Expires Harch 30, 1980
CERTIFICATE
Anita J. Leonard Notary Pub I
I. the undersigned Assistant Secretary of SEABOARD Sl.:RETY CO~!PAXY do hereby certify that the original Power of Attorney of "hie the foregoing i~ a full. true and correct copy, is in full force and effect on the date- of this Certificate and I do iurther certify that the Vice Pr~-it!~l who executed the said Power of Attorney was one of th .. Officers authorized by the Board of Dir"ctors to appoint all attorney-in-fact as prO\'j'"ed : Article VII, Section 1, of the By-Laws of SE.-\BOARD Sl.:RETY CO~!P.-\XY.
This Certificate may be signed and scaled by facsimile under and by authority of the following resolution of the Board of Directors of SE . .l BOARD SURETY CO~lPA!\Y at a meeting duly called and held on the 28th day of June 1978.
"RESOLVED; (2) That the use of a printed facsimile of the corporate seal of the company and of the ~ignature of an Assi5tant Secretal on any certification of the correctness of a copy of an instrument executed hy the President or a Vic-e-President pursuant to Article VII. ~ectil 1. of the By-Laws appointing and authorizing an attorney-in-fact to ~ign in the name and on hehalf of the company surety bonds. unden'. ritir undertakings or other instruments described in said Article VII, Section 1. with like effect as if such seal and such signature had been m;;:-.ual affixed and made, hereby is authorized and approved."
IN WITNESS WHEREOF. J ha\'e hert'unto set my hand and affixed the corporate seal of the Company to these presents t~
......................... ~.~.~h .............. day of J ~ilU"ty 19 eo. $~~ .................. " ...... . ................................... :: Ytt~~. t!!,,·:·r.t;s;;;;; i co: \'" i I./.·'l~ /·l..~{f.~·i~;~~·; I;:!! 1927 i~i \ ~ \. 'II' if}' ,.~"" .... ~ .... .,~ ' ..... ~., ..... 0
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..
JOHN WAIHEE
GOVERNOR
o o
STATE OF HAWAII DEPARTMENT OF THE ATTORNEY GENERAL.
L.ANDITRANSPORTATION' DIV1S1<?N _ ,"
ROOM 300. KEKUANAO'A BUILDING
Mr. Manabu Tagomori Deputy Director
465 SOUTH KING STREET
HONOLULU. HAWAII 96813
March 28, 1990
Hawaii Commission on water Resource Management
1151 Punchbowl street Honolulu, Hawaii 96813
Dear Mr. Tagomori:
. : ~ i'" ; .. 1
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WARREN PRICE. III ATTORNEy GENERAl
CORINNE K. A. WATANABE FIRST DEPUTY ATTORNEY GENERAl.
Re: Geothermal Mining Lease Performance Bond and Well Indemnity Bonds
We are writing in response to your January 24, 1990 request for approval as to form of geothermal mining lease performance bonds and well indemnity bonds. We call to your attention three matters that need completion before these bonds are legally proper.
First, the True Geothermal Bond Number 5615149 needs to be signed by the principal and notarized.
Second, the Geothermal Exploration and Development Corporation Bond must be countersigned bya Hawaii resident agent because its surety is not a Hawaii registered company.
Third, the Amor VIII corporation bonds need notaries on the signatures and they need to be countersigned by their Hawaii resident agent with documentation.
We have signed and approved as to form in order to save time in processing these bonds. However, this prior approval is expressly dependent upon the above three conditions being satisfied. If the above conditions are not met, then the approval signatures should be considered invalid and stricken. Please so advise the relevant parties when you forward the documents for completion.
• , o
(
Mr. Manabu Tagomori March 28, 1990 Page 2
o
If you have any questions, please feel free to contact me.
WMT:ksy 3012E
Very truly yours,
'" ;"." -..," .~., ~
i / ,// ;r..'-.'-,-i/t '-t.f/.,t L~ ':~Y- -- .:- c ,--.~ William M. Tam Deputy Attorney General
•
JOHN WAIHEE GOVERNOR OF HAWAII
o (
STATE OF HAWAII
o (
DEPARTMENT OF LAND AND NATURAL RESOURCES
P. O. BOX 621
HONOlULU. HAWAII i6a09 January 24, 1990
MEMORANDUM
TO:
ATfN:
FROM:
Honorable Warren Price III, Attorney General
Johnson Wong, Deputy Attorney General Land/Transportation Division
Manabu Tagomori, Deputy Director
L .... D ~ ,'10 -2 ---/5 I) - -q/L/- - It::.
U~ILLIJ.'W. PA~ CHAIRPERSON _ OF UNO _ NATUIIM. IIlIOUIlCES
DEI'ImE'
Keith W. Ahue MANABU TAGOMORI
RUSSELL N. FUKUMOTO
AOUACUl.TURE DEVELOPMENT PROGRAM
AQUATIC RESOURCES CONSERVATION AND
ENVIRONMENTAL AFFAIRS CONSERVATION AND
RESOURCES ENFOfICEMENT CONVEYANCES FORESTRY AND WiLDliFE lAND MANAGEMENT STATE PARKS WATER AND lAND DEVELOPMENT
SUBJECf: Review for Approval as to Form of Geothermal Resource Mining Lease Performance Bonds and Well Indemnity Bonds
Attached for your review and approval as to form are the required bonds filed by True Geothermal Energy Company, Ormat Energy Systems, Inc., and Barnwell Geothermal Corporation in compliance with our Department's Administrative Rules, Chapter 13-183, Sections 13-183-34 and 13-183-68.
Please note, that while the language contained in section 13-183-34, asks for the submittal of bond on a form approved by the Board, no such "generic" version of a bond has been utilized by the Department. However, the Department has no objections to the current body of language contained in each of the bonds submitted to date, and as such, asks for your review as to form of these bonds.
'The specific bonds submitted are identified as follows:
TRUE GEOTHERMAL ENERGY COMPANY
1) Geothermal Resources Exploration Indemnity Bond, (Geothermal Resource Mining Lease No. R-5) for the amount of $10,000, and identified by Bond No. 5615149.
2) Geothermal Resources Exploration Blanket Bond, (Geothermal Well Indemnity Bond - TruelMid-Pacific A-I) for the amount of $250,000, and identified by Bond No. 11 1914 3680.
o o i.
ORMAT ENERGY SYSTEMS/AMOR VIII
1) Geothennal Resource Lease Perfonnance Bond. (Geothennal resource Mining Lease No. R-l) for the amount of $10,000, and identified by Bond No. 3SM 714 751 00.
2) Geothennal Resource Lease Perfonnance Bond, (Geothermal Resource Mining Lease No. R-2) for the amount of $10,000, and identified by Bond No 3SM 714 751 00.
3) Geothennal Resource Lease Perfonnance Bond. (Geothermal Resource Mining Lease No. R-4) for the amount of $10,000, and identified by Bond No. 3SM 714 752 00.
4) Geothennal Resource Well Indemnity Bond. (Geothermal Well - Kapoho State Nos. 1, 2, and lA) for the amount of $250,000 and identified by Bond No. 3SM 714 749 00.
BARNWELL GEOTHERMAL CORPORATION
1) Geothennal Resources Well Indemnity Bond. (Geothennal Well - Lanipuna No. 1) for the amount of $50,000, and identified by Bond No. YS 845 7457.
2) Geothennal Resources Well Indemnity Bond, (Geothermal Well - Lanipuna No.6) for the amount of $50,000, and identified by Bond No. YS 845 8885.
3) Geothermal Resources Well Indemnity Bond, (Geothermal Well -Ashida No. 1) for the amount of $50,000, and identified by Bond No. 872109.
Your expeditious review and approval as to fonn of the attached bonds will be greatly appreciated. Should you have any questions, please feel free to contact me at Ext. 7533.
Thank you for your continued assista ce d cooperation.
DN:bm Attachment
-
----------_._ ... -
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BARNWELL GEOTHERMAL CORPORATlbJ\[jtV'ED
Mr. Manabu Tagomori Deputy Director state of Hawaii
January 25, 1990
Department of Land and Natural Resources Commission on water Resource Management P. O. Box 621 Honolulu, Hawaii 96809
Reference: Your Letter of January 12, 1990
Dear Mr. Tagomori:
We suggest that the simplest way of turning over the Lanipuna No. 1 and Ashida No. 1 is by way of transfer of ownership and operation.
Barnwell Geothermal Corporation ("BGC") will submit application to the DLNR, prior to any acti vi ty or execution of agreement wi th Hawaiian Volcano Observatory ("HVO"). After approval, BGC will finalize a transfer agreement with HVO.
Meanwhile, BGC will submit as-built drawings, and take action to plan and schedule remedial work and submit this also to DLNR before proceeding with the work.
Although your request for drawing is for Lanipuna No. 6 and Ashida No.1, please note that the transfer is related to Lanipuna No. 1 and Ashida No. 1 only.
MLJ/ECC/sm
cc: E. C. Craddick Alexander C. Kinzler Reginald Okamura, HVO
Very truly yours,
BARNWELL GEOTHERMAL CORPORATION
Martin L. Jokl President
2828 PAA STREET, SUITE 2085 • HONOLULU, HAWAII 96819 • TELEPHONE (808) 839-7720· TELEX 7238672. TELECOPIER (808) 833-5577
JOHN WAIHEE
GOVERNOR OF HAWAII
o o WILLIAM W. PATY
CHAIRPERSON
JOHN C. LEWIN, M.D. MICHAEL J. CHUN, Ph.D.
STATE OF HAWAII DEPARTMENT OF LAND AND NATURAL RESOURCES
COMMISSION ON WATER RESOURCE MANAGEMENT
P. O. BOX 621
HONOLULU, HAWAII 96809
January 12, 1990
Mr. E.C. Craddick, President Barnwell Geothermal Corporation 2828 Paa Street, Suite 2085 Honolulu, Hawaii 96819
Dear Mr. Craddick:
As a follow-up to our recent correspondence concerning the status of geothermal wells . Lanipuna Nos. 1 and 6 and Ashida No.1, and your proposal to transfer the responsibility and operation of these wells to the Hawaiian Volcano Observatory (HVO),our Department of Land and Natural Resources (DLNR) offers the following:
1) The proposed transfer of the referenced wells may require the assignment/sublease of the geothermal resource mining lease (GRML R-3) covering wells Lanipuna Nos. 1 and 6.
Pursuant to our Department's Administrative Rules Chapter 13-183, the transfer of responsibility and operation of these wells from Barnwell Geothermal Corporation (transferor), to the Hawaiian Volcano Observatory (transferee) would be subject to the approval of the Board of Land and Natural Resources. An application for a transfer requires a fee of $100.
2) A mining lease may be transferred in whole or in part. The transferee (HVO) shall be bound by the terms of the lease, including the bonding requirements. In addition, the transferor (Barnwell) and its surety shall continue to be responsible for the performance of all obligations under the lease. Should the Board release the transferor from any liabilities or duties under the mining lease those unsatisfied liabilities or unperformed duties which arose prior to the transfer shall remain the responsibility of the transferor.
3) If the transfer does not convey a separate interest in title, the transferee may become a joint principal on the indemnity bond with the transferor. The consent of the surety under such conditions is required.
ROBERT S. NAKATA RICHARD H. COX GUY K. FUJIMURA
MANABU TAGOMORI
DEPUTY
----------______ 1IIti1111b-__
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4) The transferee must also secure and maintain in force a comprehensive general public liability and property damage insurance in which the State of Hawaii, the Board, and the. Department are named insur~ds, for the minimum amounts of coverage specified in the lease and our regulations .
. 5) Under mining lease GRML R-3, the transfer of authority to operate wells Lanipuna Nos. 1 and 6 may also be possible through the designation. of HVO as the operator, without the need for an assignment or transfer of the mining lease. Such designation of a new operator must be approved by the Department's Chairperson.
The new operator must continue to comply with all applicable requirements relating to the use of the premises or the conduct of operations, including the requirement of securing and maintaining a geothermal well indemnity bond for the amount of $50,000. Such bond must remain in force for the life of the ·well and may not be released until the well is properly abandoned, as determined by the Chairperson.
6) In the case of geothermal well Ashida No.1, which is not covered under an existing geothermal resource mining lease and which cannot be transferred via an assignment of a lease, its operation by a party other than the original permittee may be possible by transferring ownership and operation of the well from Geothermal Exploration & Development Corporation (GEDCO) to HVO, and by designating HVO as the new operator of the well.
Any designation of a new operator under an amended ownership/operating agreement should be submitted to the Chairperson for approval prior to the commencement of any activity or use of the well. The party who acquires the ownership or operation of any well shall, within five days after acquisition, file with the Chairperson a new geothermal well indemnity bond or a consent by the surety to the change in principal under the existing bond.
In summary, any proposed changes concerning the responsibility and operation of the above geothermal wells, regardless of which method of transfer is selected, must be submitted in writing for review and approval by the Chairperson. Such request for approval must include a detailed discussion of each party's obligations and acknowledgement of the regulatory requirements and applicable lease conditions.
Please be advised that notwithstanding the outcome·· of any future
--------______ ".'" 'I ,,,,,, •• ~~
• • J . o o
discussions between Barnwell and HVO concerning the above transfer, the lessee and/or operator shall still be responsible for maintaining the wells and premises, providing access to the sites or properly abandoning any well. Additionally, no well shall be plugged until the manner and method of plugging has been approved or prescribed by the Chairperson.
With regard to Lanipuna No.1, the Department will require the immediate restoration of the access road, the removal of the overgrown vegetation, and the installation of proper fencing around the well-head. A plan and schedule outlining this required remedial work shall be submitted to the Department prior to the start of work. Unless immediate remedial efforts are undertaken, the Department will authorize well abandonment action, at the expense of the lessee (Barnwell) and the surety.
Lastly, the Department awaits the submittal of as-built diagrams showing existing well conditions for both Lanipuna No. 6 and Ashida No.1, requested in our letter of October 19, 1989.
Your prompt attention to the above, and a response concerning your discussions with the Hawaiian Volcano Observatory, will be greatly appreciated. Should you have any questions, please call me 548-7533.
r------.::...?
DN:bm cc: Reginald Okamura, HVO
., ,t
o o United States Department ofi-th<f.:mftti<it
Telephone: (808) 967-7328
Mr. Ed Craddick, President Water Resources International 2828 Paa Street Honolulu, HI 96819
Dear Mr. Craddick:
GEOLOGICAL SURVEY
lHIawaiian Volcano Obse£;jt(jti)r f 31 !~ 9: 04 P.O. Box 51
Hawaii National Park, Hawaii 96118 ;J. /{ A lERtiAx: (808) 967-8890
October 30, 1989
Thank you for the iruonnation concerning the availability of two 7,000-8,oo0-ft deep vertical drill holes in the lower east rift zone of Kilauea called Lanipuna #1 and Opihikao. The US Geological Survey's Hawaiian Volcano Observatory is very interested in obtaining the rights to these holes to conduct heretofore contemplated geophysical experiments.
Our main objective in acquiring these holes is to use data collected from them to refine seismicvelocity structure and temporal changes in stress of the east rift zone of Kilauea. This can be accomplished by installing a tri-axial broad-band seismograph with sensors in the accessible vertical deep holes and ground-surface and GEOS or compatible magnetic tape recording system to monitor the activity. We are initially interested in doing feasibility studies detailing short-term (6 months) operation for collection of spectral-velOCity data from local earthquakes, teleseisms, quarry blasts, volcanic tremor, ocean microseisms, and earth-ocean tidal fluctuations, with long-term (>5 years) continuance of deep hole and surface sensors for comparative spectral and velocity changes as a function of time. The ultimate goal of this project is to detect stress changes possibly applicable to earthquake and volcanic eruption-prediction models. Along with the long-term aspects of the project, conversion from on-site data collection to linkage with existing HVO telemetry should be accomplished. Allowances for other geophysical experiments involving strain meters and gravity measurements should be included as part of the use process.
There will be no adverse environmental impact while HVO conducts its experiments, other than a protective fence and shed within the fence. We also have questions as to ownership and access to the affected properties.
Concerns voiced by the staff are (1) whether there is any information or logging notes on the holes; (2) whether there are any rock cuttings available for us to analyze; and (3) whether the drill holes are suitable for simple vertical lowering and raising of cable-linked instruments.
Initial project coordinators will be Reginald Okamura, Thomas Wright, Robert Koyanagi, and Arnold Okamura from USGS-HVO and Bernard Chouet, USGS-Menlo Park, CA. Again, thank you for considering the Hawaiian Volcano Observatory as the benefactor for these holes. If there are any questions, please call us. Our number is (808)967-7328.
Sin~erely,
mGL_~~~~.~ ~ Reginald Okamura
Chief of Operations
cc: Manabu Tagomori, Department of Land and Natural Resources
----------------------------------<-"'~"--
Water ResourcQ.nternational
Mr. Manabu Tagomori Deputy Di rector State of Hawaii Department of Land and Natural Resources Commission on Water Resource Management P. O. Box 621 Honolulu, Hawaii 96809
o
"- . ..;
.,', .i,· 2 AIU : October 24s 1989
,. .' '... . . ._;. ,-·H:N j
Reference: Your Letter of October 19, 1989
Dear Mr. Tagomori:
We have been in communication with the Hawaii Volcanic Observatory concerning their interest in using Lanipuna No. 1 and the Ashida No. 1 for monitoring purposes.
They will be making a decision ,shortly and we will advise you at that time. '
'<-~~ Should geothermal plants be constructed near these areas, seismic
warnings of impending volcanic activity would be extremely valuable.
Very truly yours,
WATER RESDURCES INTERNATIONAL, INC.
ECC/sm
cc: W. R. Craddick - Hi10 Office
2828 Paa Street. SUite 2085. Honolulu. HawaII 96819. Telept10ne (808) 839 7727. Te1ecopler (808) 833-5577. Telex 7238G72 :. '<I' He;
JOHN WAIHEE
GovERNOR OF HAWAII
o " STATE OF HAWAII
DEPARTMENT OF LAND AND NATURAL RESOURCES DIVISION OF WATER AND LAND DEVELOPMENT
Mr. E.C. Craddick, President Barnwell Geothermal Corporation 2828 Paa Street, Suite 2085 Honolulu, Hawaii 96819
Dear Mr. Craddick:
P. O. BOX 373
HONOLULU. HAWAII 96809
November 20, 1989
WILLIAM W. PATY. CHAIRPERSON
BOARD OF LANO AND NATURAL RESOURCES
DEPUTIES
LIBERT K. LAN"oGRAF MANABU TAGOMORI
RUSSELL N. FUKUMOTO
AQUACULTURE DEVELOPMENT PROGRAM
AQUATIC RESOURCES CONSERVATION AND
ENVIRONMENTAL AFFAIRS CONSERVATION AND
RESOURCES ENFORCEMENT CONVEYANCES FORESTRY AND WILDLIFE LAND MANAGEMENT STATE PARKS WATER AND LAND DEVELOPMENT
Pursuant to Item No. 18 of Geothermal Resource Mining Lease R-3, issued to Barnwell Geothermal Corporation, and our Department's Administrative Rules, Section 13-183-34, every lessee shall file with the Board of Land and Natural Resources, a Geothermal Resource Mining Lease Performance Bond in the amount of $10,000, payable to the State.
In addition, Item No. 17 of the mmmg lease, and Section 13-183-35 of our rules, also requires the lessee to secure liability insurance in the amount and coverage specified by the lease.
Review of our records indicate that all Well Indemnity Bonds (for Lanipuna Nos. 1, 6, and Ashida No.1) have been submitted to the Department as required, however, no evidence exists as to the receipt of the required Performance Bond. Furthermore, we have no record of a signed and completed certificate of insurance indicating the required coverage and named insureds.
As such, in compliance with our regulations concerning bonding and insurance, please submit the required documents, or certified copies thereof, for those items specified above.
Should you have any questions, please feel free to contact me at 548-7533.
~-------------------~~.
Director
DN:bm
o o BARNWELL GEOTHERMAL CORPQRATJQN
Mr. Albert Lono Lyman, Director Planning Department County of Hawa i i
r 'I ~ t \ I , , ..J i ,I ' 1/ .~ 8' ') t~
• LV
25 Aupuni Street HHo, Hawa;; 96720 / p,!rll<-+! No. I
Special Permits 80-347 (LUC 460), 77-265 ( C 364), and 471
Biannual Statu e orts Due Januar ,
Dear Mr. Lyman: LA.u 'f'c..u..J..... W£w...s
This is to advise that there has been no change in the status of our plans since the last report, and that none are contemplated for the next six (6) months.
ECC/sm
cc: ~. Manabu Tagomori, DLNR
Very truly yours,
BARNWELL GEOTHERMAL CORPORATION
• C. Craddick President
2828 PAA STREET, SUITE 2085 • HONOLULU, HAWAII 96819· TELEPHONE (SOB) 839-mo· TELEX 7238672 • TELECOPIER (808) 833-5577
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F.RST AM::lVCAN TIl L£ cu. AFTER RECORDA'll 0lIl, ltETtJRII TO J
flKST ~IU<:.AN ruJ.J:o.....-... 6~8 ICinooie Su.:ct, Suire 20J ~Hila, Hnraii 91,720
U'l'URIf BY, MAIL C) PICKUP ( )
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CAlllCELUTION Of' GEOTHERMAL LEASE AND AGREEMENT
THIS CAH~rON 0 .. G~~ LEASE AND AGREEMENT i.
_tend 1IIto tht. day of )'lp1 , 1986, by and
between J •. ~. ~x.G COMPANY, LTD., a Hawaii corporation, who.e
principel place of basine.. and _ilin'1 addre.. i. 688 K1IIoole
Street, Suite 205, Silo, Sawaii 96720, JOD S. TOLMIE, JR.,
Vboae re.idence and _ilinq addre •• i. 1069 Laulima Place, Hila,
Bewaii '6720, AUTO IMPORTS OF RAMAII, INC., a Hawaii corporation,
who.e principal place of bu.in ••• and _ilin'1 addre.. is 811
&anoelehua Avenue, Hila, Hawaii 96720, DAVID S. DeLUZ, "'hoae
re.idence and _i11ll'1 addre •• i. 1688 Wailuku Drive, Hilo, Ha",aii
'6720, and PROMlSZD LAJID CORPORATION, a Hawaii corporation, who.e
principel place of bu.ine.. and _ilin'1 addre.. i.~ =~~~ ______ ___
~um" kQtl. Qfy@ Hr"/o,f/4Li)(J..i.i 9"1.() Le •• or under that
certain Geothermal Lea.e and Agre_nt dated June 6, 1980. and
recorded in the Bureau of Conveyance. of the State of Ha",aii in
Liber 14787, Page 245, which Agreement wa. amended by instrument
dated June 6, 1980, and recorded 111 nid Bureau of Conveyance. in
, Liber 147~i.t and G'2tYrBE.JU4Al. ,..:tLORA'lION 5
"W CORP., a ~i corporat"l'!~ who.e prinCipal place
1
DEVELOPl-'.ENT
of busineall
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t !~{~~;3 572 ././ ,.~,.J, c././.,J,~··;'tJl!G
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!!!!!.!!!!!!I WllSRPS, Lea.or an4 Le •• " 4 • .s.r. to canc.l •• id
Geoth.~l Le". aJI4 .AIJr .... nt, and r.l.... ..ch' oth.r frOID any
further liability ther.un4.r, 1IOIf, ~1lB, Le •• or and Le •••• h.r.by .qr •• th.t
aa1d Geothe~l Le ••• aJI4 AcJr .... nt i. canc.lled •• of the date
of recordation or fil1ft9 of this Cancell.tion of Geotheraal Le •••
aa4 A9re ... nt
1ft the aure.U of conveyanc.. of the Stat. of
8.,,81i, th.t neither Le •• or Dor Le •• " ahall h.reafter have .ny
ri9ht., Obli9ation., duti •• or liabiliti •• und.r .aid Geoth.rmal
~ aa4 AcJr .... Dt' aJI4 Lea.or and Le •• " hereby .atually
rel ...... ch other frOID any and .11 cl.1aa .ith.r .. y h.ve
a9aJ.nat
the other ui.1ft9 out of .aid eeoth.raal Le... an4
Acp:e.-Dt or paJIMDts aa4e thereund.r. 111 WI'nIUS 1I8EJtBOF, the L ••• or and Le •••• h.v •• xecuted
the .. presents the day and ye.r fir.t aboVe written.
.... AllDIY.
DIXON" OKUftA A~ATI.Aw
.. AuPIH S1UI1'. SWTI_ HLO.HAwAli _
LTD •
OF IlAWAIl, DIC.
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573
PROMISED LAND CORPORA'l'IOif
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GEO'l'IIUMAL EXPLORATIOif , DEVELOPMENT CORP.
LmOSOR
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LESSEE
•••
OIl this It>ffJ day of -I!/!;n"/ 1986, before _ perSOD&lly appe-ana '!!!'" ~. ~i6 J~. , to _ !tn_. vIlo, ben;; aulyaworn, ala .ay that 6e is the PreaideDt of J. T. TRADING COMPANY, LTD., a aawaii corporation, ~ that tha .. al affixed to the foreqoin'J in.trument is the corporate .. e 1 of •• id corporation, that .aid in.trument w •• signed and sealed in behalf of •• id corporation by authority of ita board of director., and the •• id officer ac!tnowled'Jed .aid inau--nt to be the fr .. ~ct and deed of .aid corporation.
~~~fclS':7-I1 My e~~4~~~e.: M,au
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19423 574
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PROMISED LAND CORPORATIOIf
By Ita
By Ita
LESSOR
GEOTHERMAL UPx.oRATIOil • DEVELOPMENT CORP.
W ~ s- By ~dl'~ Ita .
. yJt~ LESSD
State of Jlalfa11 i aa: County of 8.a11 )
01 diu 10th day of April, 1986, before .. penonally appeare4 IVAlf I. lUL\NO, to _ knOVll, who, be~ by _ duly _om, 414 • .., that be 18 the ~.t:torney-in-F.ct far Davi4 S. DlLuz, duly appointe4 by the unrecarda4 POIIer of Ac:tOrDey 4ate4 April 24, 1984, that the foregoing wt~t v .. euc:ueed in the a.. _d OIl behalf of the .aid David S. IJeLUI: .. hia Attorney-in-Fact: _d aaid Iv_ I. Nak.a acknowleclsed aaid inat~t to be the frae act of aaid Dcv1d S. DILu& •
My Coaa1aa101lexpire.: 10-16-88 ~~ NOOn PU!!~ JUDfCDJ CIRCUIT, STATE OF HAWAII
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'9423 575
•••
(In thill tr',:'~'? day of (!.".~., , 1986, before _ ~r"·:-""U'· "1 "~" r. .. '<t JO}:r.: s. 1'(,;':;''11., Jft., to _ known to be the p"r-t'on C:h:,,'c:'H..-d 1n and vho executed the for.90iuq iu.u_ut, and ackDOlfledg.4 that be execute4 the .... .. hie fr.. act and deec!.
ftAft or BAllAII
COUJrn or BAllAII
On thie llJ.Ih
•••
per.onally .pPe~ ,
to '~'i:J~r;;;:~, who, be u y .vorn, .. y t.. ~.",.;\ .• -".,.= • Be .... of AUTo IMPORTS OP HAifAII, IIfC., • HawaU corpo7ation, nd th.t the ••• 1 affixed to th. foreqoinq iMtruDent flO the COrporate •• al of •• id Corporation, that •• id ir.~trc~nt v.. .igned and ••• led in behalf of •• id corporation by .utJ..ol:ity of it. board of director., and the .aid officer aclcno-wledged .aid in.u-ut to be the fr ... ct and deed of .aid COrporation.
ftAft or IlAWAII
COIJIITY OP HAWAII ••• On thi. day of • 1186, before _
per.onally appearea DAVID 8. DeWZ, to _ known to be the person described in and who e.ecute4 the foregoing inatruaent, And acltnowledqed that be execute4 the ...... hi. fr .. act and deed.
IOtiry Mllc:, State of HawaIi
~ co.ai •• ion expire.', ________ __
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l'fAU OF tLUAII
COUMTY OF BAWAII
Jid,. P. J~.Z, ..
, ,- .... ,
19423 576
On thi. ~~ day of f!WJ\u" 1986, before -penonally appeare<!' l-j"cy c!\4M<z aM-_ . , to _ known, who,
bdnq duly 8VC)rn, aId .. y that ih~ iii the P~~\~mt .,... _ of PItOHISED LAND CORPO T ON, a Bawall corporation, and that the .eal affixed to -'"the foreqoinq iD.traaent i. the corporate •• al of .aid corporation, that .aid iD.traaent va. .i9fted and .ealed. in behalf of .aid corporation by authority of it. board of director., and the .aid o"t-ficerliC acknov1edqed .aid in.truaI8nt to be the free act aJI4 deed of .aid
corporation.
MlNJrL~ . Notary p c;state 9 t• B_AVt.rr,~ ~c,..:o.L~. -My co.-iaaion expire.: pJ\!llffl .
S'fA'l'B ~ BAWAII ••• 000IIft OF ______ _
of
.a of
CORP., a kaval! corporation, foreqoinq tn.truaI8nt i. the co that .aid tn.uu-nt va. .i9fted corporation by authority of it. board officer. acknovledqed .aid in.~nt to of .aid corporation.
NotarY
1986, before -and
, vho,
My co.-! •• ion expire.: __________ _
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q P$
T-----Tl--~--------------·-···~ ______ d~ ____________________________________ :::::::::::::::-~-".-< __ -,
--11!. ____ --J .. ~-""--~7r~.-~--...... -... ,...;."""l!"-.--1¥ ........... ',..,':.i.; .. P ... 9#"' ...... --~ ... ;"";.i~ ..... '''' .... ~.1'!I$~jl"'''''.,..L,~,?'''.· .... ·'I!!MiI!l.''''·&.3I'\!i>I!''', ... ,'"U .. -"''''''''.,'''.-'''' .... ,,..,,,.I~: .. ·-'.ih~.t::r' ... '·.,; .. ,~!"'.4i1iO .. ., __ .... f.., .... ;_. _____ .. _ ..... __ -,..---
, ~-
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A·
--
STATE or SAWAll
COt1ll'1'Y OF SAWAI I •••
of
19423 577
1986. before _ and
own. who. ey ar. t • .~~~~~ __ -:_~~
of ISED LAND CORPORATION. a HawaII that the e~ affixed to the foreqoinq
in.tru.ent i. the corporate .ea ~of~id corporation. that .aid in.truaent va. .iqned and •• aled 1ft h~ of .. id corporation by authority of ita board of director ~e .aid officer. acknowled9ed .aid inat~nt to be the f t and deed of aaid corporation.
Wotary pUblIc. State of aawall
My co.aiaaion expir •• ' _________ _
.a.
On thia OJ-.(JIL day of ~ • 1986. before _ peraonally appeared @Or!¢ CO 014; and
p. ~ on.cJG«.. , to _ known, vho, biIii9 dU y sworn, ala aay that th.y are the fl:esIPENr . and ilc&- PfZe.SI D€f.Jr of GEOTHERMAL .-UE~'U.pN • DI:."VI:LOPKENT CORP., a ~-:-Eorporat1on, and that~~ "ien affixed to the for490in9 RJ~nt i. tllta e0QM"re ... alla1 of .aid corporation, that .aid in.tr_nt va. aiCJDed _t ... 1.. in behalf of aaid corporation by authority of it. board of director., and the aaid officer. acltnovledged .. id in.tru.ent to be the fr_ act and d_d of .. id corporation.
Notary pUblic, State of Havali
My c~.aion expire.: g, /51
-5-
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i -RECORDATION REQUESIEO IIY,
Securrty lillie CorporatIon . " I
AfTER RECORDATION. RETURN TO: S()- 6a318
Security Tittlp. CArDer]';')/,
RETURN IIY, MAIL () PICKUP ( ) '.- '" ":.'
o
SPACE AElOVI: HilS liNt' ~Ol( RtGI:.fKAiC'S USE
GEOTHERMAL LEASE AND AGREEMENT
THIS LEASE AND AGREEMENT is JIlada this
day of ~n e- 1,!, fa . by ... -.d
undersigned Lessor, whether one or more, and GEO'i'IlERMAL
EXPLORATION , DEVELOPMENT CORP., as I.essee.
WIT N E SSE T II: ----------That for and in consideration of TEN MID NO/IOO
DOLLARS ($10.00) to the Lessor paid and other good and
valuable consideration, the receipt of which is hereby
acknowledged, and in consideration of the covenants and
a9reements as herein provided, the Lessor does grant, lease,
let and demise unto the Lessee, its successors and assigns,
the land and premises hereinafter described, with the sole
and exclusive right to the Lessee to enter upon and to use
and occupy the said land to explore for, drill for, develop, •
mine, produce and utilize geothermal steam, geotherm~l
fluids,. geothermal energy and heat, hot wah.c, and by
products thereof and products aRqociated therewith, and to
take, store, remove, dispose of And use same and for uses
and purposes incidental thereto, toether with the right to
construct and ~intQin any and all facilities as may be
,
0'.1 AIii\I""",J..J.., --------'1 ,.--_______ Ik:.;,:.. ____ _
I ~ ..... _.III;.n· ""·.· •• __ :.: .. : .. : __ "' ___ ._. ___ .. t_r:c_IlI • ...,J _~u.:,:~,!,(:."~ ,..,. ";,
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14787 246 necessary for Lessee's operations on the leased lan~ or
other land in the vicinity of the leased land and for
utilization of the geothermal and other products produced
therefro., including but not limited to'pipelines. power
transmission lines. power stations. tanks. ponds, roads.
and structure. thereon.
Lessor reserves the exclusive right to utilize
saId land for all purposes other thAn the purposes described
in the preceding paragraph. If Lessee's operations on the
land cause damage or loss. Lessee shall compensate the
injured party for such loss.
In the event Lessee requires the permanent use of
the surface of any of said land for facilities for generation
o~ electric power or for processing by-products of geothermal
ste .. or fluids, Lessee shall pay to Lessor the then market
value of such land so required. Lessor. however, shall
retain all mineral and geothermal rights under such lands.
subject to this lease.
'!'he land covered hereby is the land in which the
Sute of Hawaii has not reserved mineral righta, described
In Schedule ·A~ attached hereto and _de a part hereof.
TO HAVE AND TO HOLD said land for a period of
five (St years fra. date hereof (herein called ·primary
tera-l and so long thereafter a. any of the aforesaid
substances i. produced therefrom, or drilling or producing
operations are conducted thereon, or exr.uaed under the
teras hereof. If at the expiration of the primary terJll
hereof Le .... ha. not coapleted one or IIOre wells on the
leased lands or on lands pooled therewith, but i. then
2. I
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lffI!P' . ____ .:::&."!. e-.:, .... ::e:::zw'!I= ~,. Pl "~~.",~,~,,._, .•• r,.'"
~ /
1~787 Z~; engaged in drilling. redrilling or reworkillg any well or
wells drilled thereon or on lands pooled therewith. and
as a result thereof geothermal steam or any other of the
aforesaid substances is producible in commercial quantities
within eighteen (1&) months ... fter the expiration of the
primary term. then. in such event, such well or wells shall
be deemed completed during the primary term of this lease.
In consideration of the premines. it is mutually
~greed as follows:
1. Lessee shall pay~ ~es8er as rOyalty~~ a. ten per.cent (lOt) to owner of mineral ri9hts. and
b. two .,.,.rcent (2') to oWlle.c of surface rights
based on the. gross proceeds received by Lessee from the
sale of. geothermal steam •. geothermal fluids. or by-products
thereof. Lessor shall designate a single payee for each of
the ~neral and surface royalties. and. upon payment of. such
royalties to such payees. Lessee's obligatiohs under this
Section I shall cease. Lessor may change the designated
payees under this Section. not more often than semi-annually,
by delivering notIce of such cha~ge to Lessee as provided
hareln.· Should Less .. process Its by-products before sale,
Lessor's royalty and percentage rental shall bear its
proportionate share of such processing or extraction costs.
Lessee shall pay to Lessor said royalty on the 25th day of
each ~nth for accrued royalties for the prccedi~g calendar
.anth. Lessee shall have the right to commingle the geo
thermal .te .. and other substances produced from the leased
land with such substances produced from other lands and to
pay Lessor'. royalty and percentage rental on the basis of
3.
---' .... _------ - ---~.-.~---- ._-----._--.-----"
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1~787 246 production allocable to the leased land as determiEed by
metering or gauging same. Lessee shall not be required to
account to the Lessor for, or pay royalty on any such pro
ducts produced by, Lessee trom said land and used by it in
its operations hereunder.
If the Lessor or any party Lessor owns a less
interest in the substances recovered hereunder than the
entire and undivided fee estate therein. then the royalty
and rental herein provided shall be paid the Lessor or such
party Lessor only in the proportion which his ownership
bears to the whole and undivided fee.
2. Commencing with the first anniversary of
the term thereof, if the Lessee has not theretofore commenced
drilling operations on said land or te~nated this lease as
herein provided, Lessee shall payor tender to Lessor as
rental yearly in advance the s~ of ONE THOUSAND AND NO/lOO
DOLLARS ($1,000.00) per year for so much of said land as
aay then still be held under this leas~until drilling
operations are commenced. Le ..... hall nevertheless endeavor
to obtain a Special Land Use and Drilling Permit within the
first year, and shall commit to drill the first well within
one year following issue of the drilling permit.
3. Le.see JIUly at any time during the life of
this lease pool, unitiz~ or combine all or any part of the
leased land into a unit with any other land or lands or
leases adjacent, adjoining or in the immediate vicinity of
the leased lands for drilling, development, producing or
operating purposes, provided that the total acreage within
any such drilling or operating unit shall not exceed 1,000
4.
1. 1,
~'-'--"i(,,,. L.
, ____ ... .,~ __ .. _____ ·~~,..."' ..... ( .......... l_t'l:~~.'·-·').-I"f'-/. , . .,..-:-J ......... ~" ~_. ~' ....... ?!if ~~,.; '''''.
14787 24~ acres, plus or minus tenperc:ent (10%), unless by mutual
agreement.
Production as to which royalty is payable
f~any wells drilled upon any such unit, whether located
upon the leased land or other lands, shall be credited to
the leased land in the proportion that the acreage of the
leased land in such unit bears to the total acreage of such l
unit. such a unit shall be created upon Lessee's filing
with the appropriate governmental agency a notice of such
unitization describing said unit with proper notice to
Lessor thereof.
4. The obligations of the Lessee hereunder.
shall be suspended while the Lessee is prevented from
complying therewith, in whole or in part. by strikes.
lockouts. actions of the elem~nts, accidents. rules and
regulations of any Federal. State, Municipal or other
governmental agency. or other matters or conditions beyond
the reasonable control of the Lessee. wheth~r or not similar
to the .atters or conditions herein specifically enumerated.
Less .. shall also be excused from its obligations hereunder,
except that Lessee shall continue to pay rental. as afore
said. after expiration of the primary tenn during the period
of such Ruspension of Lessee's obligation. if Lessee is
unable to sell. or no ready market is available for the
sale or use of. geothc~al ~tcam or any other product
produced by Lessee frOGl the leased land. However. Lessee
shall endeavor In. good faith to secure such market for such
product or products. In the event Lessee does not. within
five (5) years after teraination of the primary term, enter
5.
-.-.~~-
14787250
into a bona fide agreement for the sale or utilization of
geothermal steam or any other product produced from the
leased land, Lessor may declare this lease in default and
may terminate same if such default is not remedied as pro
vided in this lease.
S. The Lessee shall have the right and
obligation to dispose of waste water, gases and other waste
or residual products by injecting or re~injecting into a
well or wells, or by other means, in accordance with
appropriate governmental regulations, on the leased land,
incident to the operations of Lessee in pursuance of this
lease or to the operation of any electric power generating
facility upon the leased premises •.
6. The Lessee shall pay all property taxes
on its improvements and property and minimum of 90\ of the
taxes, if any, levied against geotherma!. steam rights and
rights as to other products covered by this lease. Lessor
shall pay all taxes levied and assessed against the land as
such and Lessor's property and JllaXimum of 10\ of the taxes
levied and assessed~galn.t geothermal steam rights and
rights as to other products covered by this lease. In the
event the State, united States, or any municipality or other
governmental agency levies a license, severance, production
or other tnx on the products hereunder. or on Lessee's right
to operate or produce or sell such products. then and in
that event the Lessee ahall P4Y minimum of 90' of such tax
and Lessor shall pay aaxt.u. of 10' th~r~f. LeRSP~ is
hereby authorized to pay any taxes and assessments on behalf
of Lessor and may, if It so d.sires, deduct the amount so
6.
~"
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14787 Zt»j paid from royalties or monies due Lessor hereunder. The
percentages to be paid by Lessor shall be equal to percent
age royalty stipulated in Paragraph I, the balance shall be
paid by the Lessee.
7. The Lessee or the owner thereof shall
have the right at any time, and the duty upon termination.
of this lease, to remove from said land all machinery,
equipment, pipes, ebsing, 3truct~r~R and other property and
improvements belonging to or placed on the land by or.under
agreement with the Lessee, provided that such removal shall
be completed within a reasonable time after the termination
of this lease. I.essee agrees after termination of this lease
to leave said land in a clean condition and to level sump
holes or excavations.
8. Upon the violation of any of the terms
or conditions of this lease by the I.essee and the failure to
begin to remedy the same within ninety (90) days after
written notice from the I.essor specifying such default and
requesting remedying thereof, then, at the option of the
Lessor, this lease shall forthwith cease and terminate, and
all rights of the I.essee in and to said land be at an end,
save and excepting one (1) acre surrounding each well produc-
ing or being drilled and in respect to which I.essee shall
not be in default, and saving and excepting rights of way,
easements and surface .areas necessary for I.essee's operating
and for .. intenance and operation of electric generating and
power transmi •• ion facilities and other facilities for
utili:~tion of pr~~~~.ing of other products covered hereby,
and a. to which the person or per.ons owning or operating
7 •
I t __
7 .....
-r'~
14787 Z:'Z
such facilities are not in default under the agreement or
agreeJllents pursuant to which such facilities were installed
on the leased land. Lessee may, at any time before or after
such default, and upon payment of the sum of Ten Dollars
($10.00) to the Lessor as and for fixed and liquidated
damages, quitclaim to the Lessor all of the right, title and
interest 'of Lessee in and to the leased lands or any part
thereof, and thereupon all rij!-."" <l~d ~~l ;.,]ation::: cf t!lc
parties hereto one to the other shall thereupon cease.and
terminate as to the premises quitclaimed, except Lessee's
duties specified in Paragraph 7 above.
9. All labor to be performed and material
to be furnished in the operations hereunder shall be at sole
coat and expense of Leasee, and Lessee shall hold Lessor
tree and harmless from liability thereunder, and Lessee
shall keep the demised premises fully protected against all
liens of every character arising from or connected with its
operations hereunder.
10. Leaa_ during the term herea.! shall.
Indeanify and aave Lesaor harmless from and against any and
all claiaa and demands, including Lessor's costs and
attorney'. fees, whether for injuries to persons or loss of
life, or damage to property, occurring on the leased land
and arising out of the use of the leased land by Less~,
excepting however such claims and demands, whether"for
injuries to persons or loss of life, or damage to property,
caused by acts or omissiona of Lessor.
11. The rights of Lessor and Lessee hereunder
.. y be assigned in whole or in part. If all or any part of
8. ------_ ... -
L ..
14787 2S3 this lease-is assigned, no leasehold owner shall be~iable
for any" act or omission of any other. leasehold owner, and
failure by one to pay rental or in-lieu royalty shall not
affect the rights of others and the rentals or in-lieu
royalty shall be apportioned in proportion to acreage.
Lessee shall not sell, conveyor assign its interest or
any part of itsinterestur.der t.his lea~e without the
written consent of Lessor, which consent shall not be
unreasonably withheld. No change in ownership of Lessor's
interest, however accomplished, shall be binding on Lessee
until Lessor has furnished Lessee with written notice of
such change, and then only with respect to payments there
after made; such notice to consist of original or certified
copies of all recorded instruments, documents and other
information necessary to establish a complete chain of record
title from Lessor, and written instructions from Lessor and
Lessor's transferee directing the disbursement of any payments
which may be aade thereafter. No present or future division
of Lessor's ownership as to different portions or parcels of
said land shall operate to enlarge the obligations or diminish
the rights of Lessee.
12. This lease may be executed in any number
of counterparts with the s~e force and effect as if all
parties signed the same document.
13. This lease and all its terms, conditions
and provisions shall extend to and be binding upon the heirs,
of the parti.s hereto. Should any person, firm or corpo
ration having an interest in the land covered hereby not
9.
-
.. .- ..
,,'
~:
14787 254 lease to Lessee, or should allY one or more of the parties
named as Lessor not execute this lease, it shall nevertheless
be binding upon the party or parties executing the same.
14. Any notice from the Lessor to the Lessee
must be given by sending the same by registered or certified
mail, postage prepaid, addressed to the office, GEOTHERMAL
EXPLORATION , DE\~LOPMENT CORP., 2829 p~~ Street, Suite 2085,
Honolulu, Hawaii 96819, and any notice from the Lessee to
the Lessor must be given in the same manner addressed to the
Lessor at 1069 f,a!!lima place. Hila Hawaii 96770
The parties may, upon notice, change their said respective
addresses for notice.
15. In the event of any controversy between
the Lessor and Lessee over any provision of this Geothermal
Lease and Agreement, or arising out of default under any
provision of this Geothermal Lease and Agreement, the pre
vailing party shall recover from the non-prevailing party
ita coata, including a reasonable attorney's fee.
IN WITNESS WHEREOF the parties hereto have caused
this instrU&ent to be duly executed as of the date first
hereinabOve written.
COMPANY, LTD.
AUTO IMPORTS OF HAWAI I, INC •
Jiy~~J~ r Its )
Ll ... ..;c ~ ,d -z:f: DAVID S. D& LU:': , ~~~- ..
10.
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14787 Zr,~
PR~ISED LAND CORPORPTION
BV ~'.~: Its 'Pree. ' .
By Its
LFSSOR
GEOTHF.RMAL EXPLORATION & DEVELOPMENT CORP .
BYK~ ItS. pur.. /
By /. d i(j)c( (/.LJr ~11 \',';'1. h~~ .... .,.",T
I.ESSf:F
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.";.""~~~~~~::,~~::: 111I.1II!:!11 ........ '_IF_.'_. ___ ••• _________ -------------... - .... --.. '"" ...... '''''\-'"'.'--'-'~''' ... ''''''_'w"L .... ,..;., .,.;- .... ~r ....... , ...
c'
STATE OP HAWAII
COONTYOFHAWAII
On t:his
1980. before _ appeare4
) ) 55: )
1~787 256
,
to - known, "ho, being
j),.e~; dt!/lL by me duly sworn, did say that he is
the of J. T. '1'RAD:mG COMPANY, L1iJ.
• 8.".ii corporation, and that the seal affixed to the
foregOing instrument i!'l .-hf" r-nrIXlrate seal of eai1 corporl!ti:on,
and that said instrument "as signed and sealed in behalf of aaid corporation by authority of its
.:hh~ S. ToI"" /e X. c
Board of Directors, ~na aaid
acknowledged 8aid
inatru.ent to be the fr .. act and deed of 8aid corporation.
My C~ssion expires:
: ~~ev:,;£i ~~. V' Notary ~~c, Th~rd JudIcIal
C~rcuit, State of 8awaii
December 4, 1983
, • + -
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-::'W' _-r~: ____ .:J:~:l ___ +_:_'_'~iec_:_:~gr_·l_._:_~ft_:jf_:_'.;,_"1i"P_*'$_if'rt_:"'_t!_a_d_.ri_~t:i_~}:_1i'_ ... _."_"t_&*_.i_,..A __ 'H_t_t.Ii!:.:.a.;:.'lt_'i •• ::_itli_-_:_~_~.n.:'O __ 'Z.w ________________________________________________ , ... ,,'*w, 11-"""""",,*
w.
(
14787 2~;
STATE OF HAWI.II S5:
COUNTY OF HAWAII
On this __ 6_~_-__ day of __ X_"'_,,_t!.. ______ ,
19 ;0, before _ per.onally appeared JOHN 5. TOLMIE, JR.,
to me known to be the person described in and who executed
the foregoing in.trument. and "cknow1edqed to me that he
executed the .... as his free act and deed.
My Caa.ission expires:
Viiotary Pi.it)lic, Third Judicial Circuit, state of Hawaii
December 4. 1983
STATE OP HAWAII
COUNTY' OP HAWAII
} ) S8: )
·,
14787 258'
On' this _0 ____ '""' __ day of __ ..h:_4"_'?.....;.....;:t!:/~ ___ ;......._P
1980 p before .. appeared ...-:~=:.-...;.,.:.v..::.,..;:d:.:..-....:5~_· • ..:.ze,~=:......:~::..;~:::.;:.:v-,;.... __ · __ p
duly swomp did sa~the' is to me Jcnown p whop being by me
the J4.~::>;c:I&7 T· of AUTO IMPORTS OF HAWAlI p
INC. p a Hawaii corporation, and that the seal affixed to the
tor~o~g instxument 1s the corporate seal of said corporation,
and that said instrument was signed and sealed in behalf of
said corporation. by authority of its Board of Directors, and
said . J),uicl' S .. ~l ~-r!-.. acknowledged said
inst.rwaent· to be the free act and deed of said corporation •
'.
. . £}.t2:'7'.~ . Q.. ~~ •. '
£?Notary itfbiic, Third Judicial Circuit, State of Hawaii
Ity ec-baion expire.: December <t. 1983
.!
~'.
T
:'* ..... -;,~.,,'.,. -'-,',1.~~~~11:f7'~::- ~ ~'>i ,:~" " "., .. '-i.-; ':'~'''~;~:it.~;J!~ ~" :; .,..i.,..:!.,.".;; .... ,i;~~.::&.\o".f.::<- _~ ..
i'c."'I}' _______________________________________________________ ....
:.w. ~--------·$".---------____ ."'1 • ." .... ____ '-........... ----,--.. .,., .. " ............... -1"'01> ....... .,1 _'.'.
STATE OF HAWAII
COUlft'YOFHAWAII
On this
) ) )
ss:
day of
l' Fo. before .. per80nally appeared DAVID S. DE LUZ. to IDe .'
known to be the person described in and who executed the
for!l9oinv instrument, and acknowledged to me that he executed
the .... a. hi. free act and deed.
My Ca..i.sion expires:
VNotary tr.l.c. Third JudIcial Circu t. State of Hawaii
December 4, 1183
I 1 ~ .... --.... ------.. ~ .. ----------~··· .. -------------------------------· .. L _____ •• cc ____ __
""7. • p •• _
14781 260 -STATE OF HAWAII
SS: COUNTY OF HAWAI I
On this
1980, before me appeared
and _______________________________________ , to me personally
he M known, who, being by me duly sworn, did say that ~hey a£8
the p~:!>icten1 and
respectively, of PROMISED LAND CORPORATION, a Hawaii corpo
ration, and that the seal affixed to the foregoing instru-
ment is the corporate seal of said corporation, and that
said instrument was signed and sealed in behalf of said
c~~ation by authority of its Board of Directors, and said·
~.,~ '-taus and severally
acknowledged said instrument to ~ the free act and deed of
said corporation.
My eom.i.sion expire.:
v£~~ Q. c:A~~. / tary PUiPtC, Third Judicial
Circuit, State of Hawaii
;,:
-------------------- ".- .. - ----.---
STA'~E OF HAWAI I /lA-«JIIII
GI\''? "Me COUNTY OF tf6ttOLur.tI
14787 261
S5:
L ,.., e. . 1980. be fore
and to. R. (kl?ddt ek.. . to l1Ie personill~known. who. being by me duly sworn. did say
that they are He~;d~t: and ._~_"_·'_r_._ .. _.'_;._' ___ _
res~~ctive1y. of GEOTHERMAL EXPLORATION AND DEVELOPMENT CORP., no
a H"1oIaii corporation; w.at. t.Ae seal affixed M the fOf!goill9
such instrument was signed •• ut s@ale'" on behalf of such cor
por~tion by authority of its Board of , Directors: and said
£'@ . (f.,ocld<C& and l(J. R. (2,.4'ddt c..I:::.- acknow 1 edged such
ins~rulllent to be the free act and deed of such corporation.
v ~tary PU~lC, State of Hawaii
My comMission expires: December 4. 1983
':1> ___ .. ----------...... ~--........... '~ .
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14787 :6~ DESCRIPTION OF PROPERTY
1. All that certain tract of land situated in the District of Puna, County of Hawaii, State of Hawaii, comprising:
Tax HAp Key Tax Map Key Tax Map Key Tax Map Key
1-3-08(6) 1-3-08(7) 1-3-08(19) 1-3-09 (7)
Being a portion of the lands describe~ in and covered by Royal Patent Grant Number 3209 to Robert Rycroft and Land Patent Number 8094, Land Commission Award 8559-B Apana 15 to William C. Lunalilo. Royal P3t~~t c=~~~ 3209 c0ntain£ ~n express reservation of all mineral and metallic mines to the State of Hawaii. Land Patent 8094 and Land Commission Award 8559 B:15 contain no such reservation.
2. All that certain tract of land situated in the District of Puna, County of Hawaii, State of Hawaii comprising Tax Map Key 1-4-1(20) and being a portion of Land Patent Grant Number 13,156 and Royal Patent Number 4497, Land Commission Award Number 8559, Apana 15 to C. Kanaina, Land Patent Number 8177. Royal Patent Number 4497 contains an express reservation of rights to mineral and metallic mines to the State of Hawaii. Land Patent Grant Number 13,156, Land Commission Award 8559:5 and Land Patent Number 8177 contain no such reservation.
3. All those certain lots situate in the District of Puna, County of Hawaii, State of Hawaii comprising a portion of tax map n~bers 1-3-45 and 1-3-46 and delineated on the map entitled -Lanipuna Gardens Increment I- filed in the Bureau of Conveyances of the State of Hawaii on August 2, 1973, as File Plan Mo. 1340 and bearing the following lot and block numbers:
Block I, Lots 2, 3, 4, 5, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24 and 25;
Block 2, Lots I, 3, 4, 6, 7, 9, 46, 47, 48, 49, 50, 51, 52, 53, 54, 55, 56, 57, 58, 59, 60, 61, 62, 63, 64, 65, 66, 67 and 68;
Block 3, Lots 4, 5, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22 and 23;
Block 5, Lots I, 2 and 3,
Block 7, Lots 9, 10, 14, 16 and 171 And
Block " Lot. 12, 15, 16 and 19.
',- - • SCHEDULE -A-
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HOME Of f Ie E
INDUSTRJAL INSURANCE C"'OF HAWAII, LTD. 737 Bishop St., Suife 1900
Honolulu, Hawaii 94813
OWNEII. OBLIGEE Oil O'''GINATING CO .... ANY
atural Resources
po Box 621 Honolulu, HI 96809 CONTR"'CTO"
Barnwell Geothermal Corporation ADD"" ••
clo 2828 Paa St. Honolulu.HI D~.C"I~TION 0" CONT"ACT (I"el .. ~, IOl'ldi"R ... ~ ow.,.,', c",,'rflcl .... mb,,)
GeothermalResources Well Indemnity Bond
OWNIlII
State of Hawaii CONTR"'CT ~"'C" BOND,S,
• • 50,000.00
~ .. e ~ ., : " f,
":lI'.rDUSTIlIAl' , UiDEMNIT'r~
"I'.~{..:.. .. " "! ~ ..
feoiX ... \, GENERAL FORM
STATUS INQUIRY
DATI[
AUG 1 1983 OUR BOND NO.
YS 845-7457
EFFECTIVE D .... TE
8/16/82 WITHOUT PREJUDICING YOUR RIGHT OR AFFEC,:,I4G OUR LIABILITY UNDER OUR BOND (5 I DESCRIBED ABOVE. WE WOULD APPRECIATE SUCH
INFORMATION AS IS NOW AVAILABLE.
IF CONTRACT COMPLET!D. PLEASE STATE:
"'''~ROXIMATE DATE 0" CO"~LETION OF WORK (or /,,.tll Jdivu'1J
A(laP"O., ..... TE ACCEPTANCE DATE
,.,NAL CONTRACT .. RICE
.1.. IF CONTRACT UNCOMPI.ETED PLEASE STATE:
SINCERELY.
BY
Surety Underwriter
It is understood that the information contained herein is furnished as a matter of courtesy for the confidential use of the surety and is merely an expression of opinion. It is also agreed that in furnishing this information, no guaranty or warranty of accuracy or correct· ness is made and no responsibility is assumed as a result of reliance by the surety, whether such information is furnished by the owner or by an architect or engineer as the agents of the owner .
AP(laROXIMATI: PERCENTAGE OR DOLLAR AMOUNT OF' CONT ..... CT COM~LETED OR DELIVERED
3. DO YOU KNOW OF ANY UNPAID BILLS FOR LABOR OR MATERIAL o YES o NO
4. REMARKS (// .. .,)
The geothermal well indemnity bond remains in force for the life of the
well and may not be released until the well is properly abandoned
)ATE
~/~~/rJ (),..i,;IIJ ~ 6qc/t:-
PLEASE RETURN THIS INQUIFfY
IN THE ENCLOSED ENVIU.OPE.
Manager-Chief Engineer "'OD"E5S
P.o. Box 373, Honolulu, HI 96809 ....TTENTION
\.
--
. RECOP~ATION REQUESTED:
AFTER RECORDATION, RETURN TO:
RETURN BY: MAIL ( ) PICKUP ( )
STATE OF HAWAII
DEPARTMENT OF LAND AND NATURAL RESOORCES
GEOTHERMAL RESOURCES MINING LEASE NO. R-3
between
STATE OF HAWAII
and
~~LL GEOTHEm~ CORPORATION, a Hawaii corporation
(Geothermal Lease-May, 1981)
STATE OF HAWAII
DEPARTMENT OF LAND AND NATURAL RESOURCES
GEOTHERMAL RESOORCES MINING LE1~E
TABLE OF CONTENTS
1. LEASE ••••••••••••.••••••.••••••••.•••.••••.•.••••
2. RESERVATIONS TO LESSOR •••••••••••••••••••••••••••
A. Disposal ........ e· ••••••••••••••••••••••••••••
B. Rights-of -Way ••••••••••••••••••••••••••••••••
C. Certain Mineral Rights •••••••••••••••••••••••
o. Casing ....••.....•..•........•........•......
E. Measurements ••• • ' ••.••••••••••••••••••••••••••
3. TERM ••••••••••••• •.•••••••••••••••••••••••••••••••
A. Primary Term, Extended Term, Maximwn T.erm ••••
B. Extension of Lease Beyond Primary Term by Drilling Operations •••••••••••••••••••••••
c. Shut-in Production •••••••••••••••••••••••••••
D. Drilling or Reworking Operations After Cessation of Production .••••••••••••••••••••••
4 • RENT.ALS. • • • • • • • • • • • • • • • • "._ • • • • • • • • • • • • • • • • • • • • • • • •
A. Amount and Time of Payment •••••••••••••••••••
B. Credits Against Royalties ••••••••••••••••••••
s. ROYALTIES ••••••••••••••••••••••••••••••••••••••••
A. For Period of Initial Thirty-Five years ••••••
B. Readjustment After Thirty-Five years •••••••••
C. Deadline for Royalty Payments ••••••••••••••••
o. Royalties-Production (Absolute Open-Flow Potential) .................................. ..
E. Geothermal By-Products Testing •••••••••••••••
F. Interest and Penalties •••••••••••••••••••••••
--i-
Page No.
1
3
3
3
4
4
4
..4
4
5
5
6
6
6
7
7
7
S·
S
9
10
10
, ,
Table of Contents (cont'd)
6. REQUIREMENT TO COMMENCE MINING OPERATIONS •••••••
7. TAXES •••••••••••••••••••••••••••••••••••.•••••••
A. Real Property Taxes ••• . . . . . . . . . . . . . . . . . . . . . . B. Other Taxes ••••• . . . . . . . . . . . . . . . . . . . . . . . . . . . .
8. UTILITY SERVICES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9. SANITATION •••••••••••••• . . . . . . . . . . . . . . . . . . . . . . . .
10. WASTE: USE OF PREMISES. . . . . . . . . . . . . . . . . . . . . . . . . 11. COMPLIA.~CE WITH LAWS •••••••••••••••••• . . . . . . . . . . 12. INSPECTION OF PREMISES AND RECORDS •••• . . . . . . . . . . 13. GEOTHERMAL OPERATIONS •••• . . . . . . . . . . . . . . . . . . . . . . .
A. Removal of Derrick. . . . . . . . . . . . . . . . . . . . . . . . . . B. Operating Sites •• . . . . . . . . . . . . . . . . . . . . . . . . . . . C. Site Selection •••••••••• . . . . . . . . . . . . . . . . . . . . D. Drilling Operations ••••• . . . . . . . . . . . . . . . . . . . . E. Water Quality - Waste Disposal •••••••••• . ... F. Fish and Game Notice - Intererence ••••••••• ,.
G. Damage to Terrain. . . . . . . . . . . . . . . . . . . . . . . . . . . H. Pollution ••••• . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I. Filled Lands •• . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . J. Road Maintenance ••• . . . . . . . . . . . . . . . . . . . . . . . . . K. Timber Damaged ••.••••..••.••.........••. . . . . L. Improvements - Protection from Damage •••••••
M. Oama.ges - Payttlent •••••••••••••••••••••••••••
N. Damages to Surface or Condition of Land •••••
O. Power Plants ••••••••••••••••••• . . . . . . . . . . . . . P. Agreement with Surface Owner ••••••••••••••••
Q. Drilling Mud •.•..••.•••••.......•.•.•..•...•
R. Facili ty Si te·s ............................. .
S. Construction of Terms •••••• . . . . . . . . . . . . . . . . . T. Spacing, Production, Etc ••••••••••••••••••••
-ii-
Page No.
11
12
12
12
13
13
13
14
15
16
16
16
16
17
18
18
18
19
20
21
21
21
21
22
23
23
24
24
24
, ..... '\
Table of Contents (cont'd) Page No.
u. Drilling - Notice - Plan ••••••••••••••••• ... 25
V. Dr illing " Etc. - Circulating Medi urn •••••• 25
W. Generating Plants - Approval ••••••••••• ••••• 25
14. LIENS ••••••••••••••••••••••••••••••••••••••••••• 26
15. ASSIGNMENT OF SUBLEASE •••••••••••••••••••••••••• 26
16. INDEMNlfi .••••••••••••••••••••••••.••••••••••••. 27
17. LIABILIfi INSURANCE ••••••••••••••••••••••••••••• 28
18. BOND REQUIREMENTS ••••••••••••••••••••••••••••••• 29
19. REV'OCATION ...................................... . 30
20. SURRENDER ....................................... . 31
21. ACCEPTANCE OF RENT AND ROYALTIES NOT A WAIVER ••• 33
22. EXTENSION OF TIME OF PERFORMANCE •••••••••••••••• 33
23. NO WARRANfi OF TITLE •••••••••••••••••••••••••••• J.4
24. COMMINGLED PRODUCTION - PLANS - APPROVAL -ACCURACY •••••••••••••••••••••••••••••••••••••••• 35
25. SUSPENSION OF OPERATIONS •••••••••••••••••••••••• 36
26. DILIGENT OPERATIONS REQUIRED •••••••••••••••••••• 37
27. PRODUCTION OF By-PRODUCTS ••••••••••••••••••••••• 37
28. RECORDS AND REPORTS ••••••••••••••••••••••••••••• 38
29. FORCE .MAJEURE: ••••••••••••••••••••••• · •••••••••••• 40
30. UNIT OR COOPERATIVE PLANS ••••••••••••••••••••••• 41
31. NOTICES ••••••••••••••••••••••••••••••••••• • •••• • 41
32. RESTORATION OF PREMISES ••••••••••••••••••••••••• 42
33. HEA.DINGS •••••••••••••••••••••••••••••••••••••••• 42
34. REFERENCE ••••••••••••••••••••••••••• • • • • • • • • • • • • 42
35. INSOLVENC"l ••••••••••••••••••••••••• • • • • • • • • • • • • • 42
36. SUBSIDENCE ••••••••••••••••••••• • • : •• • • • • • • • • • • • • 43
37. WORKMEN'S COMPENSATION INSURANCE ••••••••••••••••• 43
38. SUCCESSORS ••••••••••••••••••••• • ••• • • • • • • •• • • • • • • 43
-iii-
, ., .. .\ o oj
Table of Contents (cont'd)
39. SEVERABILITY ••••••••••••••••••••••••••••••••••••
40. GEOTHElU'.:AL OWNERSHIP ••••••••••••••••••••••••••••
41. LEASE TERMS V. REGULATION 8 •••••••••••••••••••••
42. APPLICABILITY OF LEASE •••••••••.•••.•••••••••••••
-iv-
Page No.
44
44
44
44
,--\
STATE OF HA~iAII
DEPARTMENT OF ~~D AND NATURAL RESOURCES
GEOTHERMAL RESOURCES MINING ~EASE NO. R-3
THIS INDENTURE OF LEASE, made this \D~ day of
\\llI't) ~!r , Haw::(~Revised Statutes,
19 ~\ ,pursuant to Chapter 182,
and the rules and regulations pro-
mulgated thereunder, by and between the STATE OF HAWAII,
by its Board of Land and Natural Resources, hereinafter
called the "L~ssor", and BARNWELL GEOTHERMAL CORPORATION,
__ a __ H_a_w_a_1_o1_o_c_o_rp __ o_r __ a_t_i_o_n _______________________ , whose business
and post office address is
Honolulu, Hawaii 96819
2828 Paa Street, Suite 2085,
-----------------------------------------------------------------, hereinafter called the "Lessee",
WIT N E SSE T H: ----------1. LEASE
Subject to the provisions of paragraph 23 entitled
"No Warranty of Title", Lessor, in consideration of the
royalties, rental, and other monetary considerations, agree
ments and stipulations herein contained, does hereby lease
unto the Lessee the right to develop geothermal resources
and geothermal by-products in and under that certain parcel
of land, hereinafter designated as the "leased lands n., iden
tified in Exhibit "A" containing approximately 769.13
acres situated at Puna, Hawaii , as ------------------------------------------
k d E h 'b't "B-1", "B-2", shown on the maps mar e x 1 1 S "B-3", "B-4"
and "B-S", which exhibits are attached and made a part hereof.
The Lessee shall have the sole and exclusive right
to drill for, produce and take geothermal resources from the
leased lands and occupy and use so much of the surface of
the leased lands as may be reasonably required pursuant to
the provisions of section 182-3 of the Hawaii Revised
Statutes and section 6.1 of the regulations. Lessee agrees
to comply with these provisions and to save and hold the
Lessor harmless with respect to the claims made under said
statute and regulations by the owners and occupiers of the
surface of the leased lands. This Lease does include the
right to reinject beneath the leased lands geothermal fluids
subject to the prior written approval of the Lessor and
upon such terms and conditions as the Lessor considers to
be in the public interest and include any other right as may
be necessary to produce the geothermal resources. This Lease
does not confer upon the Lessee the privilege or right to
store hydrocarbon gas beneath the leased lands; nor does ~his
Lease confer upon the Lessee any other privilege or right
not expressly given herein.
This Lease is entered into with the agreement that
its purposes are and its administration shall be consistent
with the principle of multiple use of public lands and
resources; this Lease shall allow co-existence of other
permits or leases of the same lands for deposits of other
minerals under applicable laws, and the existence of this
Lease shall not preclude other uses of the leased lands.
"However, operations under such other permits or leases or
other such uses shall not unreasonably interfere with or
endanger operations under this Lease, nor shall operations
under this Lease unreasonably interfere with or endanger
operations under any permit, lease, or other entitlement for
use issued or held pursuant to the provisions of any other
law. Nor shall this Lease be construed as superseding the
authority which the head of any State department or agency
-2-
· . " . .. .
\
has with respect to the management, protection, and utili
zation of the State lands and resources under his jurisdiction.
The State may prescribe in its rules and regulations those
conditions it deems necessary ior the protection of resources.
2. RESERVATION TO LESSOR
All rights in the leased lands not granted to the
Lessee by this Lease are hereby reserved to the Lessor.
Without limiting the generality of the foregoing such
reserved rights include:
A. Disposal - If the State owns the surface of
the land, the right to sell or otherwise dispose of the
surface of the leased lands owned by the State or to sell or
dispose of any other resource in the leased lands under
existing laws, or laws hereafter enacted subject to t~e rights
of the Lessee under this Lease. Nothing provided herein
shall be construed to authorize or provide for the sale or
disposition of the surface of reserved or other privately
owned
Rights-of-way - to authorize geo-
logical 1cal explorations on the leased lands
which do not interfere with or endanger present operations
or reasonable prospective operations under this Lease, and
if the State owns the surface of the land the right to grant
such easements or rights-of-way for joint or several use
upon, through or in the leased lands for steam lines and
other public or private purposes which do not interfere with
or endanger present operations or reasonable prospective
operations or facilities constructed under this Lease.
Nothing provided herein shall be construed as a grant or the
-3-
· .. . \
right to grant an easement or right-of-way upon reserved
or other privately owned lands.
C. Certain Mineral Rights - The right to extract
at its sole cost and expense and own oil, hydrocarbon gas,
and helium from all geothermal steam and associated geo-
thermal resources produced from the leased lands; provided,
however that such extraction and ownership rights shall be
exercised by Lessor in such manner as will not unduly inter
fere with the rights of Lessee under this Lease.
D. Casing - If the State owns the surface of the
land, the right to acquire the well and casing when the
Lessee finds only potable water, and such water is not
required in lease operations; and
E. Measurements - ·The right to measure geothe~al
resources and to sample any production thereof.
3. TERM
A. primary Term, Extended Term, Maximum Term
This Lease shall be for a term of ten {lO} years
from and after the effective date of this Lease pursuant to
Rule 3.11 of the Regulations, (hereinafter referred to as the
-"primary term"), and for so long thereafter as geothermal
resources are produced or utilized in commercial quantities,
provided that the maximum term of this Lease shall not exceed
sixty-five (65) years: provided, however, that if the primary
term or the maximum term for geothermal leases should be
extended by statute, retroactively, such extended terms
shall be applicable to this Lease, or should said terms be
extended generally by statute, such extended terms may be
made applicable to this Lease upon such other terms and
conditions as the Board may determine. Production or uti-
-4-
--.. ... , . o
lization of geothermal resources in commercial quantities
shall be deemed to include the completion of one or more
wells capable of producing geothermal resources for delivery
to or utilization by a facility or facilities not yet
installed but scheduled for installation not later than
fifteen (15) years from the date of commencement of the
primary term of this Lease.
B. Extension of Lease Beyond Primary Term by
Drilling Operations
If at the expiration of the primary term hereof
geothermal resources in commercial quantities are not being
produced from the leased lands, but the Lessee is actively
engaged in drilling operations designed to drill below the
depth of 1,000 feet, or, to a production zone at a lesser-
depth in a diligent manner, this Lease shall be continued
for so long thereafter as such operations are continued with
no cessation thereof for more than 180 days, but not to
exceed a period of five (S) years, and if such drilling
operations are successful, as long thereafter as geothermal
resources are being produced_or utilized in commercial
quantities except for the sixty-five (6S) year limit ~
provided above.
c. Shut-in Production
If the Lessee has voluntarily shut-in production
for lack of a market, but is proceeding diligently to acquire·
a contract to sell or to utilize the production or is pro
gressing with installations needed for production, this
Lease shall continue in force upon payment of rentals for
the duration of the primary term or for five (5) years after
shut-in, whichever is longer. T~e Chairman shall continue
to review this Lease every five (S) years until production
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in commercial quantities occurs or this Lease is terminated
by Lessor for Lessee's lack of due diligence or is surrendered
by the Lessee. When production and sale or utilization of
geothermal resources in commercial quantities has been esta
blished, the term of this Lease shall continue as provided in
Paragraph A of this paragraph 3.
D. Drilling or Reworking Operations After Cessa
tion of Production
If production of geothermal resources should cease
by reason of a decline in the productive capacity of existing
wells after expiration of the primary term, or before the
end of the primary term if production has commenced, this
Lease shall continue so long as Lessee actively and conti-
nuously engages in drilling or reworking operations which
shall be commenced within One Hundred Eighty (180) days
after cessation of production. Continuous drilling or
reworking operations shall be deemed to have occurred where
not more than One Hundred Eighty (180) days elapse between
cessation of operations on one well and commencement of
operations on the same or another well. If such operations
are continued and if they are successful, this Lease shall
continue as long thereafter as geothermal resources are being
produced in commercial quantities, except for the sixty-five
. (65) year limit provided above.
4. RENTALS
A. Amount and Time of Payment
The first year's annual rent shall be paid pursuant
to Rule 3.12. Thereafter, Lessee shall pay to Lessor at
the Department, in advance each year on or before the anni-
d h f th 1 rental of ONE AND NO/IOO----versary ate ereo, e annua
---------------------------------------OOLLARS ($ 1.00---------, ,
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per acre or fraction thereof, on the leased lands during the
life of this Lease,' or a total of $770.00 per annum.
B. Credits Against Royalties
The annual rental due and paid for each year shall
be credited against any production royalties due and accrued
during the same year. Annual rentals paid for a given year
shall not be credited against production royalties due in
future years.
5. ROYALTIES
A. For Period of Initial Thirty-five Years
For the primary ten (10) year term and during the
first twenty-five (25) years thereafter Lessee shall pay to
Lessor the following royalties on production measured and
computed in accordance with the regulations:
1. Geothermal Resources (Excluding Geothermal By-products) A royalty of ten (10%) percent of the gross proceeds received by the Lessee from the sale or use of geothermal resources produced from the leased lands and measured at the wellhead without any deduction for treating, processing and transportation cost, notwithstanding Rule 3.l3b. of Regula tion 8.
2. Geothermal By-Products Five (5%) percent of the gross proceeds received by the Lessee from the sale of any such by-product produced under this Lease, including demineralized or desalted water, "after deducting the treating, processing and transportation costs incurred.
In the event that geothermal resources hereunder
is not sold to a third party but is used or furnished to a
plant owned or controlled by the Lessee, the "gross proceeds
of s~ch production for the purposes of computing royalties
hereuIJ.der shall be that' which is reasonably equal to the
gross proceeds being paid to other geothermal producers for
geothermal resources of like quality under similar conditions
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without deducting any treating, processing and transportation
costs incurred, notwithstanding Rule 3.l3b. of Regulation 8.
No payment of royalty will be required on water if
it is used in. plant operation for c·::>oling or generation of
electric energy or is reinjected into the sub-surface. No
royalty shall be paid for geothermal by-products used or
consumed by Lessee in his production operations.
Gross proceeds shall not be deemed to include
excise, production, severance or sales taxes or other taxes
imposed on the Lessee by reason of the production, severance
or sale of geothermal resources or geothermal by-product~.
B. Readjustment After Thirty-five Years
Royalty rates on geothermal resources and geothermal
by-products shall be readjusted, subject to the limitations
specified in the regulations and in accordance with the pro
cedures prescribed therein at the expiration of the thirty-
fifth (35th) and fiftieth (50th) years of the Lease; provided,
however, that such readjustment shall be only as to.the
royalty rate and not as to the basis for determining payment
to the Lessor.
If the royalty rates for any ensuing period have
not been determined prior to the expiration of the preceding
period, the Lessee shall continue to pay the royalty rates
effective for the previous period, but the Lessee shall,
within thirty (30) days after the new roy~lty rates have
been so determined, pay the deficiency, if any.
c. Deadline for Royalty Payments
The Lessee shall make ~ayments of royalties to the
Lessor within thirty (30) days after the end of each calendar
month following such production and accompany such payment
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with a certified true and correct written statement by the
Lessee, showing the amount of geothermal resource and geo
thermal_by-product produced, sold, used and/or othe~ise
disposed of and the basis for computation and determination
of royalties. The Lessee shall furnish such other data as
may be necessary to enable the Lessor to audit and verify all
royalties due and payable to the Lessor.
o. Royalties-Production (absolute open flow
potential)
If the Lessee supplies steam to any electrical
generating facility from wells on both the leased lands and
other lands and there is producible from all such wells in
aggregate a quantity of steam greater than the maximum quantity
utilizable by said electrical generating facility, Lessee-
agrees to. produce and sell or use steam from the leased lands
in a proportion no less than'the proportion that the absolute
open flow potential (the absolute open flow potential as used
herein is the rate of flow in pounds of steam per hour that
would be produced by a w~ll if the only pressure against the
face of the producing formation in the well bore were atmos
pheric pressure) of the wells on the leased lands bears to
the total absolute open flow potential of all such wells from
which Lessee supplies steam to such electrical generating
facility. For purposes of this section it shall be deemed
that the Lessee supplies steam from a well to an electrical
generating facility when such well is capable of producing
geothermal resources in commercial quantities to such facility.
The absolute open flow potential of all s~ch wells whether
on the leased lands or other lands shall be determined by the
Lessor and shall be based upon tests performed by the Lessee
as prescribed by the Lessor. In this regard, Lessee shall,
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upon completion of each of such wells, and prior to the
placing of such wells on commercial production, perform, and
deliv~r to the Lessor the results of, the following tests:
1. Pressure Test - Pressure-buildup tests
to determine static reservoir pressure and well bore
conditions. If pressure-buildup tests are based on
shut-in wellhead data, then static well bore temperature
surveys must also be conducted:
2. Isochronal Flow Tests - Isochronal flow tests
or two rate flow tests to establish a back pressure
curve and the absolute open flow potential:
3. Other Tests-Static Reservoir Pressure -
Other tests as deemed to be necessary by the Lessor.
After commencement of commercial production from
each of such wells, Lessee shall annually, or more fre-
quently if requested by the Lessor, determine static
reservoir pressure and complete any other tests as
specified by the Lessor.
E. Geothermal By-Products Testing
The Lessee shall furnish the Chairman the results
of periodic tests showing the content of by-products in the
produced geothermal resources. Such tests shall be taken
as specified by the Chairman and by the method of testing
approved by him, except that tests not consistent with
industry practic~ shall be conducted at the expense of the
Lessor.
F. Interest and Penalties
1. Interest - It is agreed by the parti£:s hereto
that any royalties, rentals, or other monetary considerations
arising under the provisions of this Lease and not paid when
due as provided in this Lease, shall bear interest from the
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day on which such royalties, rentals, or other monetary
consideration were due at the rate of 12% per annum or such
higher rates as l1'.ay be permitted by law until such roya.lties,
rentals, or other monetary considerations shall be paid to
the Lessor.
2. Penalty - It is agreed by the parties hereto
that any royalties, rentals or other monetary considerations
arising under the provisions of this Lease and not paid when
due as provided in this Lease, shall be subject to a five
(5%) percent penalty on the amount of any such royalties,
rentals, percentage of net profits, or other monetary cons i-
derations arising under the provisions of this Lease.
3. Definition of Royalties, etc. - It is agreed
by the parties hereto that, for the purpose of this secti~n,
"royalties, rentals or other monetary considerations arising
under the provisions of this Lease and not paid when due"
includes but is not limited to any amounts determined by the
Lessor to have been due to the Lessor if, in the judgment of
the Lessor, an audit by the Lessor of the accounting statement
required by paragraph 28 below shows that inaccurate, unrea
sonable or inapplicable information contained or utilized in
the statement resulted in the computation and payment .to the
Lessor of less royalties, rentals, or other monetary consi-
derations than actually were due to the Lessor.
6. REQUIREMENT TO COMMENCE MINING OPERATIONS
Lessee shall commence mining operations upon the
leased lands within three years from the effective date of
this Lease, excluding a~y research period which has been
granted; provided, that so long as the Lessee is actively
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and on a substantial scale engaged in mining operations on
at least one geothermal resources mining lease, the covenant
to commence mining operations shall be suspended as to all
other leases held by the Lessee, covering lands on the same
island.
7. TAXES
A. Real Property Taxes
Lessee shall pay any real property taxes levied
on that portion of the surface of the leased lands utilized
by Lessee, according to the value allocated thereto by
Lessor or other appropriate State or County agency based on
the use of the surface of the portion of the land by Lessee
and the use of the remainder of the land by others entitled
thereto. Lessee shall also pay any real property taxes levied
on the structures and improvements placed thereon and utilized
by Lessee; provided that all subsurface rights and any geo
thermal resources underlying the leased lands under this
Lease shall be deemed to have only nominal value for real
property tax assessment purposes until such time, if any,
as specifically authorized by law. If Lessor has exercised
its rights under paragraph 2 herein, said taxes shall be
prorated according to Lessee's interests.
B. Other Taxes
Royalties paid hereunder shall be in lieu of
any severance or other similar tax on the extracting, pro
ducing, Winning, beneficiating, handling, storage, treating
or transporting of geothermal resources or any product into
which the sam~ may be processed in the State of Hawaii;
nevertheless, if any such tax should be assessed, then such
tax shall be deducted from any royalties otherwise due here-
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under. As to any and all other taxes of any nature assessed
upon geothermal resources or geothermal by-products there
from or assessed on aCCjunt of the production or sale of
geothermal resources or geothermal by-products from the
leased land, Lessor and Lessee each shall bear such tax in
proportion to its respective fractional share of the value
of such production.
s. UTILITY SERVICE
Lessee shall be responsible for all charges, duties
and rates of every description, including water, electricity,
sewer, gas, refuse collection or any other charges, arising
out of or in connection with Lessee's operations hereunder.
9. SANITATION
Lessee shall keep its operations and improvements
in a strictly clean, sanitary and orderly condition.
10. WASTE: USE OF PREMISES
a. Lessee shall not commit, suffer or permit to
be committed any waste, nuisance, strip mining or unlawful
use of the leased lands or any part thereof.
b. Negligence - Breach - Non-Compliance - Lessee
shall use all reasonable precautions to prevent waste of,
damage to, or loss of natural resources including but not
limited to gasses, hydrocarbons and geothermal resources, or
reservoir energy on or in the leased lands, and shall be
liable to the Lessor for any such waste, damage or loss to
the extent that such waste, damage, or loss is caused by (1)
the negligence of Lessee, its employees, servants, agents or
contractors; (2) the breach of al·y provision of this Lease
by Lessee, its employees, servants, agents or contractors,
or non-compliance with applicable federal, state or county
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statutes or rules and regulations; provided, however, that
nothing herein shall diminish any other rights or remedies
which the Lessor may have in connection with any such negligence,
breach or non-compliance. With respect to any other such
waste damage or loss, Lessee agrees to indemnify, save the
Lessor harmless and, at the option of the Lessor, defend the
Lessor from any and all losses, damages, claims, demands or
actions caused by, arising out of, or connected with the
operations of the Lessee hereunder as more specifically
provided under paragraph 16 hereof. Lessee shall not be
obligated to defend the Lessor's title to geothermal resources.
11. COMPLIANCE WITH LAWS
Lessee shall comply with all valid requirements
of all municipal, state and federal authorities and observe
all municipal, state and federal laws and regulations per
taining to the leased lands and Lessee's operations hereunder,
now in force or which may hereafter be in force, including,
but not limited to, all water and air pollution control laws,
and those relating to the environment; provided, however,
no revision or repeal of the regulations as defined in
paragraph 34 subsequent to the effective date hereof shall
change the rental, royalty rate, term, or otherwise subs tan-
-tially change the economic terms under this Lease; provided,
further, however, that the State of Hawaii, acting in its
governmental capacity, may by such regulations or amendments
thereto made at any time regulate the drilling, location,
spacing, testing, completion, rroduction, operation, main
tenance and abandonment of a well or wells or similar activity
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as well as the construction, operation a'nd maintenance of
any power plant or other facilities in the exercise of its
police powers to protect the public health, welfare and
snfety as provided in the regulations.
Lessee shall have the right to contest or review,
by legal procedures or in such other manner as Lessee may
deem suitable, at its own expense, any order, regulation,
direction, rule, law, ordinance, or requirement, and if able,
may have the same cancelled, removed, revoked, or modified.
Such proceeding shall be conducted promptly and shall include,
if Lessee so decides, appropriate appeals. Whenever the
requirements become final after a contest, Lessee shall .
diligently comply with the same. Lessee also agrees that
in its employment practices hereunder it shall not discriminate
against any person based upon race, creed, sex, color, national
origin or a physical handicap.
12. INSPECTION OF PREMISES AND RECORDS
Lessor, or persons authorized by the Lessor, shall
have the right, at all reasonable times, to go upon the leased
lands for the purpose of inspecting the same, for the purpose
of maintaining or repairing said premises, for the purpose
of placing upon the leased lands any usual or ordinary signs,
for fire or police purposes, to protect the premises from any
cause whatever, or for purposes of examining and inspecting
at all times the operations of Lessee with respect to wells,
improvements, machinery, and fixtures used in connection
therewith, all without any rebate of charges and without
any liability on the part of the Lessor f9r any loss of
occupation or quiet enjoyment of ~~e premises thereby
occasioned.
Lessor or its agents may at reasonable times inspect .
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the books and records of Lessee with respect to matters
pertaining to the payment of royalties to Lessor. Complete
information shall be made available to Lessor. In o?ddition,
qualified representatives and/or consultants designated by
Lessor may examine the reports specified in this Lease and
all other pertinent data and information regarding wells on
the leased lands and production therefrom. In the event of
surrender of all or a part of the leased lands Lessee shall
furnish Lessor all data with respect to such surrendered •
lands including interpretations of such data for use in future
lease negotiations with third parties. Lessee agrees on
written request to furnish copies of such information to
Lessor's qualified representatives or consultants.
13. GEOTHERMAL OPERATIONS
Lessee shall carryon all work hereunder with due
regard for the preservation of the property·covered by this
Lease and with due·regard to the safety and environmental
impact of its operations and in accordance with the following
terms and conditions:
A. Removal of Derrick.· Lessee shall remove the
derrick and other equipment and facilities within sixty (60)
days after Lessee has ceased making use thereof in its
operations.
B. Operating Sites. All permanent operating sites
shall be landscaped or fenced so as to screen them from public
view to the maximum extent possible, as required in the dis-
cretion of the Department of Land and Natural Resources. Such
landscapin~ or fencing shall be approved in advanc~ by the
Lessc.r an~"-nr·-CJood cond;i.:tion.
(~,;~ c. Site Selection. p-;icir to commencing a particular
"'~ ~ operat~Ene-~urfI~e=~:the leased lands, Lessee will
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consult with the occupier and submit the details concerning -------------------_.-
the proposed operation, such as the location or route of any
drill site, facility site, installation site, surface area,
road, pond, pipelinu, power line, or transmission line, as
the case may be, to the occupier by certified mail for the
occupier's approval. If the occupier does not approve such
proposal, occupier will submit within thirty (30) days an
alternate written proposal. If occupier does not submit an
alternate proposal, Lessee may proceed with its operation
as originally proposed, subject
. 23 .-~~he occupier and Lessee ~_/
to the provisions of paragraph
cannot agree, the matter will
be submitted to arbitration.
D. Drilling Operations. All drilling ahd production .. operations shall be conducted in such manner as to eliminate
as far as practicable dust, noise, vibration, or noxious
odors. The operating site shall be kept neat, clean and
safe. Drilling dust shall be controlled to prevent widespread
deposition of dust. Detrimental material deposited on trees
and vegetation shall be removed. Lessee will take such
steps as may be required to prevent damage to crops. The
determination as to what is detrimental will be made by the
Lessor.
No well shall be drilled within five hundred (500)
feet of any residence or building on the leased lands without
first obtaining the occupier's written consent.
In any well drilled by Lessee hereunder sufficient
casing shall be set and cemented so as to seal off surface
and subsurface waters, any of which would be harmful to
agricultural or o~her operations.
E. Water Quality-- Waste Disposal. Lessee shall
file wit~ the Lessor a repor~ of any proposed waste discharg~.
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Wastes shall be discharged in accordance with
requirements and prohibitions prescribed by the Lessor. The
Lessor and any other state agency having jurisdiction over
the affected lands 'shall also approve the place and manner of
such waste disposal.
F. Fish and Game Notice - Interference. Lessee
shall communicate with the Division of Fish and Game prior
to any operations which may adversely affect fish and wildlife
resources. Lessee shall conduct its operations in a manner
which will not interfere with the right of the public to fish
upon and from the public lands of the State and in the waters
thereof or will not preclude the right of the public to use
of public lands and waters.
G. Damage to Terrain. Any operations disturbing
the soil surface, including road building and construction
and movement of heavy equipment in support of or relating to
specific geothermal exploration or development activities
shall be conducted in such manner as will not result in
unreasonable damage to trees and plant cover, soil erosion,
or in degradation of waters of the State, including fish
and aquatic life habitat. Lessee will conduct its operations
in a manner that will not unreasonably interfere with the
enjoyment of the leased lands by the occupier or persons
residing on or near the leased lands.
H. Pollution. Pollution of the ocean and tide
lands, rivers, or other bodies of water, and all impairment
of and interference with bathing, fishing, or navigation in
the waters of tl~e ocean or any bay or inlet thereoi is pro
hibited, and no brine, minerals, or any refuse of any kind
from any well or works shall be permitted to be deposited on
or pass into waters of the ocean, any bay or inlet thereof,
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rivers, lakes or other bodies of water, without specific
written State authorization.
No Leased Substances which may be produc~d, from
any well drilled upon the 1(3ased lands shall be blown, flowed,
or allowed to escape into the open air or on the ground in
such a manner as to create a nuisance, which shall specifically
include but not be limited to noise, air or other pollution,
and other activities which disturb the occupier's or his
Tenant's use of the leased lands. Subject to the foregoing,
Lessee may bleed Leased Substances to the atmosphere so long .
as such operations are lawfully and prudently conducted in
accordance with good geothermal drilling and production
practices and are not otherwise violative of the provisions
of this Lease.
I. Filled Lands. No permanent filled lands, piers,
platforms, or other fixed or floating structures in, on, or
over any tide and submerged lands covered by this Lease or . otherwise available to Lessee shall be permitted to be con-
structed, used, maintained, or operated without obtaining
any and all permits required , under applicable State and
Federal law, rules and regulations, and complying with all
valid ordinances of cities and counties applicable to Lessee's
operations, and without securing the written permission of
the Lessor specifically authorizing the activity.
J. Road Maintenance. Lessee will take such
steps at Lessee's own expense as are necessary to insure that
its roads, well sites, plant sites and other operation areas
will b-. kept as dust fre~ as is practicable so that dust will
not decrease ,the market value of adjacent growing crops or
interfere with the occupier's or his tenant's uses.
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Lessee will use existing roads where such are
available for its operations. All roads, bridges and culverts
used by Lessee will be maintained by it and roads surfaced
or treated in a manner that will prevent dust from inter
fering with agricultural or residential use of the leased
lands. Lessee shall be responsible for the maintenance of
and repair of damages caused to roads used by Lessee on or
serving the leased lands. The occupier and Lessor and their
agents, tenants and licensees shall have the full use of
roads constructed by Lessee but shall be responsible for the
repair of any unusual damage caused to such roads by their
use. In constructing roads, Lessee shall install necessary
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culverts or bridges so as not to interfere with the irrigation
or drainage of the leased lands.
K. Timber Damaged. In the absence of any agree
ment to the contrary, timber damaged, destroyed, or used on
the leased lands shall be compensated for at market value to
the surface owner. Borrow pit material shall not be obtained
from the leased lands without permission and payment of
market value to the surface owner.
L. Improvements - Protection from Damage.
Improvements, structures, telephone lines, trails, ditches,
pipelines, water developments, fences, crops and other pro-
perty of the State or surface owners, other lessees or per
mittees shall be protected from damage and repaired or
replaced by Lessee when damaged by Lessee.
M. Damages - Payment. In the event any buildings
or personal property or crops shall be damaged or destroyed
because of Lessee's operations on the leased lands, then
Lessee shall be liable for all damages occasioned thereby.
Lessee in its operations on the leased lands shall at all
times have due and proper regard for the rights and con
venience, and the health, welfare and safety of the occupier
and of all tenants and persons lawfully occupying the leased
lands. In the event that Lessee's operations result in any
condition, including but not limited to water table or depo
sition of chemicals, or harmful substances, which adversely
affects the continued production of crops or then beneficial
uses and purposes of the land, occupier at his option may
require Lessee to reimburse the occupier, his tenants and
persons lawfully occupying the leased lands as to the affected
acreage in accordance with subparagraphs N 1 and 2 of this
paragraph 13.
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N. Damages to Surface or Condition of Land.
Lessee shall pay the surface owner for the surface of each
acre of land or fraction thereof utilized, taken or used or
rendered substantially unusable by the Lessee in its operations,
pursuant to the terms of this Lease, for farming or stock
raising operations or other uses or purposes for which the
land is then being used or for which the surface owner had
made other plans, which shall include, but not be limited
to, the lands occupied by drill sites, facility sites, road-
ways constructed by Lessee, ponds, pipelines, utility lines,
power and transmission lines, production facilities, and
other facilities and structures, together with other uses
of the surface, save and except certain plants and buildings
provided for in subparagraph 0 below, in accordance with
one of the following methods to be elected by surface owner.
1. Lessee shall pay the surface owner annually
from the date of acquisition a rental equivalent to the fair
rental value which is being paid each year for like property.
2. Lessee shall pay surface owner severance damages
if any to the surrounding land and purchase the surface acreage
required by Lessee for its fair market value with right of
surface reverter in the surface owner when no longer utilized
by Lessee in its operations.
o. Power Plants. In the event Lessee, or a public
utility, pursuant to Lessee's operations hereunder, desires
to construct any plant or building site and is required to
have fee title for such purpose, then Lessee shall pay
occupier the fair market value for the surface of such plant
or building site and the severance damages, if any, to the
parcel from which such plant or building site is taken.
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P. Agreement with Surface Owner. In the event
that the Lessor does not own the surface of the leased lands
and if the geothermal developer who is responsible for developing
the resources on the leased lands enters into a lease with
the surface owner, then the provisions of such lease from
the surface owner shall supercede the foregoing paragraphs
13.K. through 13.0 and 14 relating to surface use, and such
paragraphs shall thereafter have no force and effect where
it is inconsistent with the lease with the surface owner.
Q. Drilling Mud. Drilling mud shall be ponded
in a safe manner and place, and where required by the Lessor,
posted with danger signs, and fenced to protect persons,
domestic animals, and wildlife. Upon completion of drilling,
the mud shall be disposed of, or after drying in place,
covered with a protective layer of soil.
Lessee agrees to fence all sump holes and exca-
vations and all other improvements, works, or structures
which might interfere with or be detrimental to the activities
of the occupier or other adjacent or nearby users of the
land, and to build sumps and to take all reasonable measures
to prevent pollution of surface or subsurface waters on or in
the leased lands. Upon abandonment of any well on the
leased lands, or on the termination of this Lease, or upon
quitclaim or reverter of any leased land by Lessee, then as
to such leased land Lessee shal~ level and fill all sump holes~
and excavations shall remove all debris, and shall leave those
areas of tne leased lands used by Lessee in a clean and
sanitary condition suitable for farming or in the condition
it was at the inception of this Lease if its use was other
than farming, and shall pay. the occupier for all damages to
occupier's buildings, structures, or other property caused
by Lessee.
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R. Facility Sites. Areas cleared and graded for
drilling and production facility sites shall be kept to a
reasonable number and size, and be subject to Lessor's approval.
Unless economic and technological considerations
will not permit, wells will be drilled directionally in order
to minimize the number of drill sites required. Well sites
and facility sites will be shaped and located to the extent
practicable to interfere as little as possible with the
occupier's operations including the spacing, location and
operation of the occupier's improvements, planned and con-
templated uses, grading, utility and drainage sy~tems, and
roads, and to prevent undue interference or danger to the
occupier's or his tenant's farming and other operations.
Where economically and technologically feasible, wells shall
be drilled directionally from a single well site. Drill sites
may also be located on unused portions of the leased lands.
The drill sites will not ordinarily exceed five (5) acres
in size but will vary in accordance with the number of wells
drilled from such site and the amount of production equipment
placed thereon. Plant or facility sites will be limited in
size to approximately ten (10) acres per site.
s. Construction of Terms. The above are in
addition to, and not to be construed as limitations upon,
all other rules, regulations, restrictions, mitigation
measures and all other measures designed to restrict, limit,
modify or minimize the environmental impact of operations
carried out pursuant to this Lease as set forth in this
Lease.
T. Spacing, Production, Etc. - The Lessor may
determine the spacing of wells and the rate of development
and production of such wells to prevent the waste of geo-
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thermal resources and to promote the maximum economic
recovery from, and the conservation of reservoir energy in,
each zone or separate underground source of geothermal
resources. Such determination shall be based on recognized
engineering standards and shall be consistent with prevailing
economic and market conditions.
u. Drilling - Notice - Plan - Lessee, before
commencing the drilling of a well, shall notify the Lessor
of its intention to drill, and such notice shall contain the
location and elevation above sea level of derrick, proposed
depth, bottom hole location, casing program, proposed com
pletion program and the size and shape of drilling site,·
excavation and grading planned, and location of existing and
proposed access roads. Where the surface of the leased lands
is under the jurisdiction of a State agency other than the
Department of Land and Natural Resources, Lessee shall provide
at the same time such information listed above as is pertinent
to that agency.
v. Drilling, etc. - Circulating Medium - All
drilling, redrilling, perforating, or work-over operations
within the leased lands shall be done with an accepted
circulating medium.
w. Generating Plants - Approval - No generating
plants, buildings, structures, production equipment, metering
systems, pipelines or roads for the production, sale or use
of geothermal resources (hereinafter referred to as "geo
thermal facilities") shall be installed or constructed except
on prior Lessor's approval and the approval of any other
governmental agency having jurisdiction over such installation
or construction. Any contract entered into by Lessee with a
Public U~ility or any other person or entity for the install-
-25-
ation or construction of geothermal facilities shall contain
provisions requiring the Public Utility, or other person or
entity to obtain the approval of the Lessor and other govern-
mental agencies before installation or construction of geo-
thermal facilities.
14. LIENS
Lessee will not commit or suffer any act or neglect
whereby the estate of the Lessor or the surface owner or
occupier of the leased lands shall become subject to any
attachment, lien, charge or encumbrance whatsoever, and shall
indemnify and hold harmless the Lessor, surface owner and
occupier, against all such attachments, liens, charges and
encumbrances and all expenses resulting from any such act or
neglect on the part of the Lessee.
Lessee will, before commencing construction of any
improvements or any drilling operations or laying any pipe
lines or doing any other work on or within the leased lands,
deposit with Lessor, surface owner and occupier of such lands
a bond or certificate thereof naming Lessor, said surface
owner and occupier as obligees in a penal sum of not less
than one hundred per cent (100%) of the cost of such con
struction, drilling or pipe line work and in Iorm and with
surety satisfactory to Lessor, the surface owner and occupier
"guaranteeing the completion of such work free and clear of
all mechanics' and materialmen liens.
15. ASSIGNMENT OR SUBLEASE
Lessee shall have the right to transfer this lease
to any person qualified under the applicable law and regu
lations by assignment, sublease, or other transfer, of any
nature including the creation of security interests in
Lessee's interest in this Lease and Lessee's rights hereunder,
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~~~~~~-------------------------, .. -
•
'. . "
.. , ) .. -"
) / oj ~
in whole or in part, and as to all or a part of the leased
lands, subject to the approval of the Lessor, which approval
will not unreasonably be withheld. Upon approval, Lessor
may release the transferor from any liabilities or duties
except for any liability or duty which arose prior to such
approval.
16. INDEMNITY
The Lessee agrees to hold harmless and indemnify
the State of Hawaii and its divisions, departments, agencies,
officers, agents and employees, together with the owner or
lessee of the ,surface of the leased lands, if any, from any
and all liabilities and claims for damages and/or suits for
or by reason of death or injury to any person or damage to
property of any kind whatsoever, whether the person or pro
perty of Lessee, his agents, employees, contractors, or
invitees, or third persons, from any cause or causes whatso-
ever caused by any occupancy, use, operation or any other
activity on the leased lands or its approaches, carried on
by the Lessee, his agents, employees, contractors, or invitees,
in connection therewith; and the Lessee agrees to indemnify
and save harmless the State of Hawaii, the Board, the
Chairman, the Department, owner or lessee of the surface
if there be one, and their officers, agents, and employees
from all liabilities, charges, expenses (including counsel
fees) and costs on account of or by reason of any such
death or injury, damage, liabilities, claims, suits or losses.
The foregoing indemnity specified in this Lease and
in the regulations is not intended to nor shall it be con
strued to require the Lessee to defend ~~e Lessor's title
to geothermal resources and in case of 1i,tigation involving
the titles of the Lessee and the Lessor, Lessee and the
-27-
Lessor will join in defending their respective interests,
each bearing the cost of its own defense.
17. LIABILITY INSURANCE
Prior to entry upon the leased lands the Lessee
or transferee shall obtain, at its own cost and expense,
and maintain in force during the entire term of this Lease,
a policy or policies of comprehensive general public lia
bility and property damage insurance from any company
licensed to do business in the State of Hawaii covering
liability for injuries to persons, wrongful death, and
damages to property caused by any occupancy, use, operations
or any other activity on leased lands carried on by Lessee
or transferee, its agents or c~ntractors in connection
therewith, in the following minimum amounts:
a. Comprehensive General Bodily Injury
Liability - $300,000.00 each occurrence,
$1,000,000.00 aggregate.
b. Comprehensive General Property Damage
$50,000.00 each occurrence, $100,000.00
aggregate.
Liability coverage for injury or damage to persons
or property caused by explosion, collapse and underground
hazards are to be included prior to initiation of operations
.to drill a well for geothermal discovery, evaluation or
production. Lessee shall evidence such additional coverage
to the Chairman prior to initiation of drilling operations.
If the land surface and improvements thereon covered by this
Lease are o~ed or leased by a person other than the State
of Hawaii, the owner and lessee, if any, of the surface and
improvements shall be a named insured. The State of Hawaii,
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· \. .. "
the Hawaii State Board of Land and Natural Resources, the
Chairman of the Board of Land and Natural Resources, and
the Department of Land and Natural Resources, shall also be
named insureds.
No cancellation provision in any insurance policy
shall release the Lessee of the duty to furnish insurance
durinq the term of this Lease. A signed and complete certi-
ficate of insurance, containinq the special endorsement
prescribed in the requlations and indicatinq the coverage
required by this paraqraph,shall be submitted to the
Chairman prior to entry upon the leased lands. At least -
thirty (30) days prior to the expiration of any such polley,
a signed and complete certificate of insurance, indicating
the coverage required by this paragraph, showing that such
insurance coverage has been renewed or extended, shall be
filed with the Chairman.
IS. BOND REQUIREMENTS
The Lessee and every assignee, sublessee or
transferee hereof shall file with the Board, a bond in the
amount of $10,000.00 in a form approved by the Board and
made payable to the State of Hawaii, conditioned upon faithful
performance of all requirements of Chapter 182, Hawaii
Revised Statutes, the regulations thereunder and of this
Lease, and also conditioned upon full payment by the Lessee
of all damages suffered by the occupiers of the leased lan~s
for which Lessee is legally liable. If the Lessee holds more
than one (l) geothermal resources mining lease from the
State of Hawaii, it may file with the Board, in lieu of
separate bonds for each lease, a blanket bond in the amount
of $50,000.00.
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19. REVOCATION
This Lease may be revoked by the Board if the Lessee
fails to pay rentalE and/or royalties when due or fails to
comply with any of the other terms of this Lease, law, or
regulations, or if the Lessee wholly ceases all mining
operations for a period of one year without the written
consent of the Board for reasons other than force majeure or
the production of less than commercial quantities of geothermal
resources or by-products. However, before revocation of
this Lease for defaults other than the failure to pay rents
and/or royalties when due, the Board shall give the Lessee
written notice of the claimed default and an opportunity to
be heard within thirty(30) days of such notice. The Lessee
shall be allowed sixty (60) days to correct such default or,
if the default is one that cannot be corrected within sixty
(60) days, to commence in good faith and thereafter proceed
diligently to correct such default, following written notice
of a determination after hearing by the Board that such
default exists. Failure to comply with the foregoing shall
be deemed sufficient cause for revocation. Defaults arising
because of failure to pay rents and/or royalties when due
must be cured within sixty (60) days of a written notice of
default; otherwise this Lease may be revoked. In the alter-
native the Lessee may surrender this Lease as hereinafter
provided.
Upon the revocation of this Lease, Lessor shall
have the right to retain the improvements or require the
Lessee to remove the same and restore the leased lands to
a similar condition prior to any dev~lopment or improvements,
to the extent reasonably possible and, upon failure by the
Lessee to do so, the Lessor may recover the cost thereof,
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..... , .. ".
'.
-) /-~,
./
~ 0
in addition to imposing any penalties as provided by law or
regulations.
20. SURRENDER
If Lessee has complied fully with all the terms,
covenants and conditions of this Lease and the Regulations,
Lessee may surrender, at any time and from time to time, this
Lease in its entirety or with respect to any portion of the
land described in this Lease. For the purposes hereof, if
there are no deficiencies with respect to the land to be
surrendered pertaining to public health, safety, conservation
of resources and preservation of the environment, Lessee will
be deemed to have complied fully with'all of the terms, .
covenants and conditions of this Lease and the Regulations
if Lessee shall have paid all rents and royalties due here
under and an additional two years' rent for all of the leased
lands or, in the event of a partial surrender, two years'
rent prorated by reference to that portion of land described
in this Lease which is to be surrendered. No deficiencies
shall be deemed to exist unless, within sixty (60) days after
delivery of the document of surrender, the Lessor has notified
the Lessee in writing of any deficiency claimed to exist.
If there are no deficiencies as aforesaid, such surrender .
shall be effective as of the delivery to Lessor of the
document of surrender executed by Lessee describing this
Lease or that portion of the leased lands which is to be
surrendered. If there are claimed deficiencies with respect
to the land to be surrendered pertaining to public health,
safety, conservation of resources and preservation of the
environment at the time of delivery of the document, such
surrender shall not become fully effective until such time
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. ~ . .
as such deficiencies have been corrected or determined not
to exist. However, provided that if Lessee corrects such
deficiencies within sixty (60) days of notification thereof,
or if the deficiencies cannot be corrp-cted within sixty (60)
days, commences in · .. good faith and thereafter pro·ceeds dili-
gently to correct such d~ficiencies, then, in such case,
although the surrender shall not be fully effective upon
delivery of the document of surrender, the Lessee shall be
relieved of any other or further obligations and liability
as to this Lease or as to that portion of the leased lands
which has been submitted for surrender, whether such liabi-
lities or duties arise out of this Lease or the Regulations,
including, without limiting the generality of the foregoing,
all obligations to pay rent, to commence mining operations
or to be diligent in exploration or development of geothermal
resources. During the notification and correction periods
above described, this Lease shall not be subject to revocation
by the Lessor except for a failure by the Lessee after noti
fication to·correct such deficiencies within the time period
and in the manner hereinabove described or a breach of the
terms of this Lease as to any of the remaining leased lands
or rights retained by the Lessee; provided, however, that
should Lessee contest the validity of any claimed deficiency,
. the Lessee's obligation to correct shall be suspended pending
appeal to and determination by a court of final jurisdiction. ~
Except as aforesaid, nothing herein contained shall constitute
a waiver of any liability or duty the Lessee may have with
respect to the land or Lease surrendered as a result of any
activity conducted on the leased land or under this Lease
prior to such surrender. Upon the surrender of this Lease
.'
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· . '.
as to all or any portion of the land covered thereby, or upon
any other termination of this Lease except by revocation,
the Lessee shall be entitled to all equipment, buildings,
and plants placed in and on the leased lands and the Lessor
may require the Lessee to remove the same and restore the
premises to a similar condition prior to any development or
improvements, to the extent reasonably possible. This Lease
may also be surrendered if as a result of a final determination
by a court of competent jurisdiction, the Lessee is found to
have acquired no rights in or to the minerals on reserved
lands, nor the right to exploit the same, pursuant to this
Lease, and, in such event, the Lessor shall pay over to the
person entitled thereto the rentals, royalties and payments
paid to the Lessor pursuant to this Lease.
21. ACCEPTANCE OF RENT AND ROYALTIES NOT A WAIVER
The acceptance of rent or royalties by the Lessor
shall not be deemed a waiver of any breach by the Lessee of
any term, covenant or condition of this Lease, nor of the
Lessor's right to give notice of default and to institute
proceedings to cancel this Lease in the manner set out in
paragraph 19, and the failure of the Lessor to insist upon
strict performance of any such term, covenant or condition,
or to exercise any option conferred, in anyone or more
instances, shall not be construed as a.waiver or relinquish-
ment of any such term, covenant, condition or option.
22. EXTENSION OF TIME OF PERFORMANCE
That notwithstanding any provision contained herein
to the contrary wherever applicable, the Lessor may f~r good
cause, as determined by the Board, allow additional time
beyond the time or times specified herein to the Lessee, in
which to, comply, observe and, perform any of the terms, con-
-33---------------_ .. _ ..... ,,-
" . " .
ditions, and covenants contained herein.
23. NO WARRANTY OF TITLE
The Lessor does not warrant title to the leased
lands or the geothermal resources and geothermal by-products
which may be discovered thereon; this Lease is issued only
under such title as the State of Hawaii may have as of the
effective date of this Lease or may thereafter acquire. If
the interest owned by the State in the leased lands includes
less than the entire interest in the geothermal resources
and geothermal by-products, for which ro¥alty is payable, as
determined by the courts or otherwise, then the bonus, if
any, rentals, royalties and other monetary considerations
paid or provided for herein shall be paid to the Lessor
only in the proportion which its interest bears to said
whole for which royalty is payable, and the Lessor shall be
liable to such persons for any prior payments made and
adjudged by the courts or otherwise; provided, however, that
the Lessor shall not be liable for any damages sustained by
the Lessee.
This Lease is issued subject to all existing valid
rights at the date hereof and such rights shall not be
affected by the issuing of this Lease. In the event the
leased lands have been sold by the State, subject to mineral
. reservation, Lessee agrees to follow such conditions and
limitations prescribed by law providing for the State, and
persons authorized by the State to drill for, produce and
take geothermal resources, and occupy and use so much of
the surface of the leased lands as may be required for all
purposes reasonably connected ~with. Wlthout--1..L'1ti-t-i
the effects of the foregoing, ~re Lessee is not the surface
owner, Lessee agrees that before entering, occupying, or
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. , t. . .
) o
using any of the surface of the leased lands, for any or all
purposes authorized by this Lease, Lessee will first secure -the written consent or waiver of the owner of the surface of (.----------_._- .. ---'~"" --.-.. -.-~.~-----~ .. --~---.. -~.".-.--.. -..... -the leased lands or occupier; second, make payment of the -------... _-_ .......... ,.-, ..... _,.-.> ... "'" ...-
damages to crop~or ... Qther tangible improvements to the owner
thereofior third, in l~:~Of either of the foregoing provisions, ~:~"~ ....... ::;~~,,,,-.:..;.:r.~.~, .... ,-;...~ .. ", ,. .... ' -",
execute a good and sufficient bond or undertaking, payable
to and in an amount specified by the Lessor for the use and
benefit of the surface owner or occupier of such land, to
secure payment of such damages to the crops or tangible
improvements of the surface owner or occupier of said'land
as may be determined and fixed in an action brought upon the
bond or undertaking in a court of competent jurisdiction
against the principal and sureties thereon, such bond or
undertaking to be in the form and in accordance with the
rules and regulations. In the event that the State owns
only the mineral resources, this Lease is issued subject to
any and all right, title and interest of the purchaser,
title holder or owner of the surface of the leased lands,
and any successor in interest to any such purchaser, title
holder or owner of the leased lands, any other provision in
this Lease to the contrary notwithstanding.
24. COMMINGLED PRODOCTION - PLANS - APPROVALS - ACCORACY
Subject to testing the absolute open flow potential
of wells, whether on the leased lands or other landS, as set
forth in paragraph 5D hereof, geothermal resources from any
two or more wells, regardless of whether such wells are
located on the leased lands, may be commingled when the
metering system used to measure geothermal resources has been
approved by the Lessor. Prior to the installation of the
metering system, Lessee shall submit for approval a schematic
-35-
" .
.~
\ ~
'I' q-/
drawing of the proposed system and specifications of the
major equipment components. The Lessor will determine if
acceptable standards of accuracy for measuring geothermal
resources have been obtained, and may approve commingling of
geothermal resources. The metering equipment shall be main
tained and operated in such a manner as will meet acceptable
standards of accuracy. Use of the equipment shall be discon
tinued at any time upon determination by the State that standards
of measurement accuracy or quality are not being maintained,
with such commingling stopped until measurement accuracy has
been obtained. In the event that the quality and composition
of the geothermal resources to be commingled are substantially
different, it shall not be approved by the Lessor until accept
able standards and methods of payments are established. If
less than the total flow is to be utilized in a plant or
facility, then the reduction in flow for each well shall be
in the proportion which the total open flow of each contri
buting well bears to the total open flows of all contributing
wells.
25. SUSPENSION OF OPERATIONS
In the event of any disaster or pollution, or
likelihood of either, having or capable of having a detrimental
effect on public health, safety, welfare, or the environment
. caused in any manner or resulting from operations under this
Lease, the Lessee shall suspend any testing, drilling and
production operations, except those which are corrective, or
mitigative, and immediately and promptly notify the Chairman.
Such drilling and production. operations shall not be resumed
until adequate corrective measures have been taken and autho
rization for resumption of operations has been made by the
Chairman.
-36-
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o
26. DILIGENT OPERATIONS REQUIRED
The Lessee shall be diligent in the exploration and
development of the geothermal resources on the leased lands.
Failure to perfc.rM diligent operations may subject this Lease
to revocation by the Board. Diligent operations mean explo-
ratory or development operations on the leased lands including
without limitation geothermal surveys, heat flow measurements,
core drilling, or the drilling of a well for discovery,
evaluation, or production of geothermal resources.
The provisions hereof shall be construed and applied
with reference and in relation to geological and engineering
determinations and economic and market conditions with respect
to geothermal resources in the area or field in which the
leased lands is situated. In the event Lessor believes,
based on reasonable cause, that Lessee has failed to perform
diligently, Lessee may request a hearing and determination,
in accordance with paragraph 19 hereof, of the particulars in
which Lessee has failed to conduct diligent operations, and
if after such hearing Lessee is found not to be diligent in
its operations, then if Lessee does not, within ninety (90)
days thereafter, commence and in good faith continue remedying
such finding of lack of diligence, Lessor may revoke this
Lease as herein provided.
27. PRODUCTION OF BY-PRODUCTS
Lessee shall have no obligation to save or process.
any geothermal by-products unless such saving or processing,
independent of revenues or value received from the production
of other geothermal resources, including other geothermal
by-products, is economically feasible.
-37-
,
>;
, ~\ J
28. RECORDS AND REPORTS
(a) Accounting Data. No later than the twenty
fifth (25th) day of every calendar month following the effective
date of this Lease, Lessee shall submit a detailed accounting
statement for lease operations specifying all charges paid
and credits received under this Lease, including but not
limited to information showing the amount of gross revenue
derived from all geothermal resources produced, shipped, used
or sold and the amount of royalty due. The Lessee shall, at
the option of the Lessor, provide more detailed statements
and explanatory materials to aid the Lessor in interpreting
and evaluating Lessee's accounting statement. All such
statements are subject to audit and revision by the Lessor
and Lessee agrees that the Lessor may inspect all Lessee's
books, records and accounts relating to operations under this
Lease, including but not limited to the development, pro-
duction, sale, use or shipment of geothermal resources at
all reasonable times. Any statutory or other rights that
Lessee may have to object to such inspection by the Lessor
are hereby waived.
(b) Exploration Data. Lessee agrees to supply
to the Lessor within thirty (30) days of the completion
thereof, or the completion of any recorded portion thereof,
.all physical and factual exploration results, logs, surveys
and any other data in any form resulting from operations
under this Lease or from any surveys, tests, or experiments
conducted on the leased lands by Lessee or any person or
entity acting with the consent of Lessee or with information
or data provided by Lessee. Lessee agrees to supply to the
Lessor within thirty (30) days of the completion thereof, or
-38-
· . . ... ... ..
the completion of any recorded portion thereof, the results
of all geological, geophysical or chemical tests, experiments,
reports and studies, including but not limited to reservoir
studies and tests, experiments, reports or studies relating
to reinjection or reservoir depletion irrespective of whether
the result of such tests, experiments, reports or studies
contain sensitive or proprietary or confidential information
or trade secrets. Lessee further agrees that any statutory
or other rights or objections it may have to prevent disclo
sure of any such tests, experiments, reports or studies
referred to in this paragraph by the Lessor are hereby waived.
Notwithstanding any provisions hereof, however, all data" and
documents supplied by Lessee pursuant to this section shall
be deemed to have been "obtained in confidence" and may be
disclosed to other persons only with the written consent of Lessee or upon a determination by the Lessor that such dis-
closure is in the public interest or as otherwise provided
by law or regulation.
(c) waiver by Lessee. Lessee' "hereby waives any
and all rights and objections it may have to prevent an
examination of the books and records at'reasonable times
of any individual, association, or corporation which has
transported for, or received from Lessee, any geothermal
resources produced from the leased lands. Further, Lessee
waives any and all rights and objections it may have to
prevent an examination and inspection of the books and records,
at reasonable times, of any such individual, association or
cor,?oration with respect to such individual's, association's,
or corporation's, or to Lessee's operations, wells, improve
ments, machinery and fixtures used on or in connection with·
-39-
the leased lands.
Lessee does hereby waive any statutory or other
right or objection to prevent disclosure to the Lessor or
a duly authorized employee or representa~ive of the Lessor
of any information, reports; data, or studies of any kind,
filed by Lessee with any public agency, federal, state or
local, relating to the leased lands, the geothermal resources
thereunder, or any operations carried out in connection with
this Lease irrespective of whether such information, reports,
data, or studies of any kind contain sensitive or proprietary
or confidential information or trade secrets. Any and all .
such information, reports, data, or studies of any kind filed
by Lessee with any public agency, federal, state or local,
including all information filed with the Lessor pursuant to
any paragraph of this Lease, shall be available at all times
for the use of the Lessor or its duly authorized represen-
tatives for any purpose. Notwithstanding any provisions
hereof, however, any information, reports, data or studies
obtained by the Lessor from any public agency and which are
not public records shall be deemed to have been "obtained
in confidence" and may be disclosed to other persons only
with the written consent of Lessee or upon a determination by
the Lessor that such disclosure is in the public interest.
29. FORCE MAJEURE
If the Lessee is rendered unable to wholly or in
part by force majeure to carry out its obligations under
this Lease, Lessee shall give to Lessor prompt written
notice of th·~ force majeure. Thereupon, any obligations of
the Lessee to perform so far as they are affected by the
force majeure shall be suspended during the continuance of
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the force majeure and the primary term or any continuation
period shall be extended for a period equal to the period of
suspended performance caused by the force majeure. Lessee
shall use all possible diligence to remove or correct the
force majeure, but this shall not require the settlement of
strikes, lockouts or other labor difficulties. In no event
shall any extension affect the sixty-five (65) year maximum
term of this Lease.
30. UNIT OR COOPERATIVE PLANS
The Lessee may, with the written consent of the
Board, utilize the leased lands or portions thereof under a
unit, cooperative or other plan of development or operation
with other State, Federal or privately owned lands for the
drilling and production of one or more wells in accordance
with Rule No. 3.15 of the Regulations.
31. NOTICES
Pursuant to Rule 8.2 of the Regulations, Lessor
may give any notice or deliver any document hereunder to
Lessee by mailing the same by registered mail addressed to
Lessee at BA]U~LL GEOTHERMAL CORPORATION, 2828 Paa Street,
Suite 2085, Honolulu, Hawaii 96819
-------------------------------------------------------or by
delivering the same in person to any officer of Lessee.
Lessee may give any notice or deliver any document hereunder
to Lessor by mailing the same by registered mail addressed
to Lessor at DEPARTMENT OF LAND AND NATURAL RESOURCES,
P. O. Box 621, Honolulu, Hawaii 96809 ----------------------------------------------
or by delivering
the same to Lessor in person. For the purposes of this
paragraph, ,either party may change its address by written
notice to the other. In case of any notice or document
delivered by registered mail, the same shall be deemed
delivered when deposited in any United States Post Office,
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· ' . "
properly addressed as herein provided, with postage fully
prepaid.
32. RESTORATION OF PREMISES
Upon the revocation, surrender or expiration of
this Lease, the Lessor or surface owner may require the
Lessee to restore the leased lands to their original condition
insofar as it is reasonable to do so within ninety (90) days
thereof, except for such roads, excavations, alterations or
other improvements which may be designated for retention by
the surface owner, the Lessor or its agency having jurisdiction
over said lands. When determined by the Lessor, surface
owner or such State agency, cleared sites and roadways shall
be replanted with grass, shrubs, or trees by the Lessee.
33. HEADINGS
The paragraph headings throughout this Lease are
for the convenience of the Lessor and the Lessee and are not
intended to construe the intent or meaning of any of the
provisions thereof.
34. REFERENCE
Unless specifically indicated otherwise, the
regulations referred to in and governing this Lease shall
be Regulation No. 8 relating to Regulations on Leasing of
Geothermal Resources and Drilling for Geothermal Resources
"in Hawaii approved and adopted by the Board on March 10,
1979, and all terms used herein shall be given the meaning
as set out in Rule 1.5 of said Regulation 9.
35. INSOLVENCY
In the event the Lessee at any time during the
term hereof is insolvent under any of the provisions of the
Federal Bankruptcy Act, or makes a voluntary assignment of
his assets for the benefit of creditors, or is adjudged a
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, . . "
bankrupt, either upon Lessee's voluntary petition in bank-
ruptcy, or upon the involuntary petition of Lessee's creditors,
or any of them, or should an attachment be levied and permitted
to remain for any unreasonable length of time upon or against
the interest, rights or privileges of Lessee in or to any
geothermal res?urces produced from the wells drilled by Lessee
upon the leased lands, then, upon election by the Lessor,
all of the interests, rights, and privileges of Lessee in
and to all geothermal resources produced and s4ved from the
leased lands by reason of Lessee's operations thereon, shall
terminate upon receipt of written notice from the Lessor
advising that the State has so elected. In such event the
Lessor shall have, and Lessee, by the acceptance hereof,
hereby gives the Lessor the right, option and privilege to
cancel and terminate this Lease and all of the terms and
provisions granted hereby, and all of the rights and privi
leges of Lessee in and to or upon the leased lands and in and
to any geothermal resources produced and saved from the
leased lands by reason of Lessee's operations thereon, and
all of Lessee's rights and privileges granted by this Lease
shall terminate immediately, upon receipt of written notice
from the Lessor that the Lessor has so exercised its option.
36. SUBSIDENCE. Any subsidence to the leased or adjacent
lands shall be considered pursuant to 7.7 of Regulation 8.
37. WORKMEN'S COMPENSATION INSURANCE
Lessee shall at all times in any and all operations
under this Lease and in any and all work in and upon the
leased lands carry full and complete Workmen's Compensation
Insurance covering all employees.
38. SUCCESSORS
. The term "Lessor" qerein shall mean and include
-43-
',.
Lessor, its legal successors and assigns, and the term
"Lessee" herein or any pronoun used in place thereof shall
mean and include the masculine or feminine, the singular or
plural number, and jointly and severally individuals, firms
or corporations, and their and each of their respective heirs,
successors, personal representatives and permitted assigns,
according to the context hereof.
39. SEVERABILITY
If any provision herein is judicially determined,
to be invalid, it shall be considered deleted herefrom and
shall not invalidate the remaining provisions.
40. GEOTHERMAL OWNERSHIP
If the Lessee hereunder is the surface landowner
it is mutually agreed that issuance of this Lease by the
Lessor and acceptance thereof by the Lessee shall not be
deemed or construed to be a waiver of, and shall be without
prejudice to, any claim of ownership to the geothermal
resources by the Lessee and Lessor incidental thereto.
41. LEASE TERMS VS. REGULATION 8
Unless indicated otherwise herein, Regulation 8
shall supersede any of the lease provisions herein which
conflicts with said Regulation.
42. APPLICABILITY OF LEASE
This lease is being issued to the Lessee as assignee
and holder of the occupier's rights to a mining lease and
shall not be applicable to those parcels of lands where the
" Lessee has not acquired such rights.
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o
IN WITNESS WHEREOF, the parties hereto have caused
these presents to be executed this 10~ day of ;:\1 i r) •• <!-
19 Cf:,\
APPROVED BY .THE BOARD OF LAND AND NATURAL RESOURCES
AT ITS MEETING HELD ON
~~N .. U\.h.<.( '0) ''\$1 cs
APPROVED AS TO FORM:
-0
STATE OF HAWAII
LESSOR
BAru~WELL GEOTHERl4AL CORPORATION
By ~I~t-s----------------------------
LESSEE
-45-
,
, ..
STATE OF HAWAII
COUNTY OF
On this
) ) SS )
______ day of , 19 ___ ,
before me personally appeared -------------------------------and _______________________________________ to me known to be
the person(s) described in and who executed the foregoing
instrument and acknowledged that executed the same ------as free act and deed. ----
Notary PUblic, State of Hawaii
My commission expires:
~TA'!a~",PF HAWAII )
f..)I V\.. J J""- _I . . ,. • }) SS C UN'l'Y OF .JtJU / ~
On this z41b day of q~. . 19fjL.
before me appeared ~.JJ. J(1h?,/~ and C:dl ~~ , to me personally
known, who, being by me duly sworn, did say that they are the
~"b tilt &NJ..~ 9Ivtt ~ ~nd p~
--------------------, respectively, of
gm~QQ)9~ , and that the seal affixed to
the foregoing instrument is the corporate seal of said cor
poration, and that said instrument was signed and sealed on
behalf of said corporation by authority of its Board of
--=('f\{Y\lgYU~_---.;;,JJ_. JCt _____ n __ :'6~· ___ ~_ and Directors, and the said
__ <J~0l~ __ ~~ ______ · ______________ acknowledged that they executed
said instrument as the free act and deed of said corporation •
. Notary public, State of Hawaii
My commission expires:
c'
, . . .
EXHIBIT A
Lands situate at Kapoho, Kaniahiku, Keahialaka and Pohoiki, Puna, Hawaii, being all of those certain parcels of land (portions of the land described in and covered by:
1. Royal Patent 4497, Land Commission Award No. 8559, Apana 5, to C~ Kanainai
2. Royal Patent Grant No. 3209 to Robert Rycroft; and
3. Land Patent No. 8094, Land Commission Award No. 8559-B, Apana 15, to Wm. C. Lunali10 designated by Tax Map Key as follows:
TAX MAP KEY TAX MAP KEY AREA
1-3-45:9 ~ 1-3-46: 60-1-3-45:10 / 1-3-46: 61~ 1-3-45: 14/ 1-3-46:62· 1-3-45: 16/ 1-3-46:63 1-3-45:17/ 1-3-46:64
1-3-45 :25 I 1-3-46:65 1-3-46:66
1-3-45: 22/ 1-3-46:67 1-3-45:21/ 1-3-46:68 1-3-45 :18/ 1-3-46:69
1-3-46:70/ 1-3-46:2/ 1-3-46:71 1-3-46 :3/ 1-3-46:72, 1-3-46 :4/ 1-3-46:73' 1-3-46 :5/ 1-3-46:74", 1-3-46 :13/ 1-3-46:29 1-3-46:14/ 1-3-46:30/ 1-3-45:15/ 1-3-46:33/ 1-3-46 :16/' 1-3-46:34 1-3-46:17/ 1-3-46:35 1-3-46:18/ 1-3-46:36' 1-3-46:191 1-3-46:37 1-3-46:20/ 1-3-4&:38 1-3-46:21/ 1-3-46:39 . 1-3-46:22/ 1-3-46:40 1-3-46 :23/ 1-3-46:41 1-3-46:24' . 1-3-46:42 1-3-46:25/ 1-3-46:43
1-3-46:44 1-3-46:761" 1-3-46:45 1-3-46:78' 1-3-46:46 1-3-46:79' 1-3-46:41 1-3-46:81 1-3-46:48 1-3-46:82
1-3-46:49 1-3-46:84' 1-3-46:52 1-3-46:50 (Subtotal of 1-3-46:53 1-3-46:51 foregoing) 77.0000 acres 1-3-46:54' 1-3-46:55 1-3-08:06' 140.0000 acres 1-3-46:56 l-3-46:51 1-3-08:01/ 160.2920 acres 1-3-46:58 1-3-46:59 1-3-0a:19/ 227.5910 acres
1-3-09: 07/ 119.1800 acres
1-4-0-1: 20 /(portion) . 45.0738 acres
TOTAL 769.1368 acres
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INTj;~NAT!CNAL, U'K.
Environmental Baseline Report
Prepared for Geothermal Exploration and Development Corp.
by S.M. and B.Z. Siegel
26 January, 1981
~-----------------.,-
... o
CONTENTS
Summary
A. Chemistry of Air and Soil
B. Plant Sampling
C. Avifauna
D. Botanical Survey
E. Archaeological and Historical
Site Reconnaissance
F. Maps
G. Personnel
o
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SUMMARY
A standard environmental baseline study was carried
out at the Tokio Corporation geothermal prospect which
extends northeasterly from the area S. of HGP-A to the
area W. of the Daiichi-Seiko Prospect (see maps, Section F).
Environmental chemistry suggests a weak trend toward
HGP-A area-like features at Stations 1 and 2 to Daiichi-like
characteristics at prospective drill locations 5 and 6.
The area is disturbed, ecologically and heavily repre
sented by exotic and non-endangered native birds.
Although there is good evidence for Hawaiian agricultural
practice, no evidence of pre-historic or early historic
era sites was noted.
A few areas of concern and caution are pointed out
including old Hawaiian use of, lava tubes and nesting areas
of the Hawaiian Hawk. Of the potential endangered plant
species, none were found.
------'-------------_ ... , .. ,-
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A. Chemistry of Air and Soil
o o Over the range of proposed exploratory sites fixed gases
showed no variations of interest or significance, being
generally below detection levels. (Table 1)
Air mercury levels were highest toward HGP-A (site 1)
and fell to a minimum at sites 5 and 6 on the edge of the
Daiichi prospect (Table 2). This is-fully consistent with
previous independent aerometrics data taken over an extended
period of s~udy. The significance of the high values around
HGP-A is not clear. but it is related to Kilauea East-Rift
activity, not to a local wellhead source of mercury.
The air mercury trend which varies from a low of 0.51 ~g.m-?
or by 58% is not paralclled in soil levels, which seem to
fluctuate randomly around a mean of 48 ~g.m-3 by about +10-11%
(Table 3).
Soil arsenic,·unlike mercury, shows a possibly significant
trend from sites 1 and 2 to sites 5 and 6 (Table 4). All
arsenic values were in fact low, but the distributions of the
lowest toward HGP-A is again consistent with earlier baseline
studies.
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Table 1 Fixed Gases at the Exploratory Sites
26-29 December 1980**
Gas Site No. H2S 502 CO CO2 NO x
ppb ppm ppm % ppm
1 <5(3)t <0.05(2) <10(2) 0.033 <0.03
2 <5(3) <0.05(2) <10(2) '0.035 <0.03
3U* <5(3) <0.05(2) <10(2) 0.037 <0.03
3 <5(3) <0.05(2) <10(2) 0.034 <0.03
30* <5(3) <0.05(2) <10(2) 0.034 <0.03
4 <5(3) <0.05(2) <10(2) 0.033 <0.03
5 <5(3) <0.05(2) <10(2) 0.034 <0.03
6 <5(3) <0.05(2) <10(2) 0.035 <0.03
0
*3U and 3D are respectively, 300 m upwind and downwind of Site 3.
**During this period, temperatures of 22-250 C and light trades of ca 5 knots were recorded. Sky <10% cloud cover.
t() ~ No. of replications
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Table 2 Air Mercury, Sites as in Table 1,
26-29 December, 1980
Site No. Sample Sample AV~3 a b l1go m
1 0.68 0.92 0.80
2 0.60 0.72 0.66
3U 0.52 0.56 0.56
3 0.48 0.52 0.50
3D 0.60 0.48 '0.54
4 0.56 0.48 0.52
5 0.55 0.50 0.52
6 0.50 0.53 0.51
Air samples are ~ 2 hr. averages and represent minimum sample volumes
of 0.2 m 3, more typically 0.35-0.5 m3•
Site
I
2
3U
3
3D
4
5
6
o
Table 3 Soil Analysis for Mercury
Sample a
48
42
°48
56
43
50
48
49
Sample b
39
46
44
48
47
46
58
59
Samples of 12-16 g prepared by HN03 digestion
o
Ave ppb
44
47
46
52
45
48
53
54
o 0'
Table 4 Soil Analysis. for Arsenic
Site Sample Sample Ave a b ppm
1 0.10 0.13 0.12
2 0.18 0.12 0.15
3U 0.18 0.16 0.17
3 0.22 0.19 0.21
3D 0.19 0.26 0.23
4 0.30 0.26 0.33
5 0.35 0.33 0.34
6 0.37 0.32 0.35
Soil samples of l2-l6g prepared by HCI dige.stion
.. ,
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. B.' Plant Sampling
\
Site
1
2
3U
3
3D
4
5
6
o Q
Table 1 Leaf" Tissue Mercury Analysis
Species
a Metrosidcros (ohia) b Psidium (guava) c Pluchca . d Dicranopteris
a Ohia b P1uchea c Dicranopteris d Nephrolepis
a Ohia b Guava c Pluchea d Rubus e Nephrolepis
a Guava b Rubus
·c Pluchea. d Nephrolepis
a P1uchea b Dicranopteri:s c Nephrolepis
a Guava b Pluchea c Dicranopteris d Nephrolepis
a Obia b Guava c Pluchea d Dicranopteris
a Ohia b Guava c Pluchea d Dicranopteris
*Based on 8-12g leaf samples
Hg Content* ppb
200 89
206 88
170 168 81 80
139 170 1,60 100
80
106 91
151 72
155 71 80
96 169 117
76
130 ·106 186
76
136 112 196 84
•
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Table 2 Maximum Expected Rare, Threatened or Endangered
Species 1n Tokio Geothermal Prospect
Family
Apocynaceae
Campanulaceae
Goodeniaceae
P1ttosporaceae
Rubiaceae
Species
Rauvolfia remotiflora Deg. & Sherff
Clermont1a hawaiiensis (Hbd.) Rock var.Uilwniiensis
Scaevola kilaueae Deg. var. K11aucae
Pittospor1um hosmer1 Rock var. hosmer1
Bobell t1mon1oides (Ho.ck.) Hbd.
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Among the six potential exploration sites, Pluchia was
found at a11i guava, and the fern Dicranopteris, were found
at 5 locations; and Ohia, with the fern Nephrolepis was found
at 3 (Table 1).
At station 3, indicated species are differentiated, with
open ohia-guava woodland to the NE (wpwind and mak~i) and a
denser, less diversified' fern and ~erb community on the makai .
(downwind and SW) side of Pohoiki road.
With respect to leaf mercury content. there' is suggestion
of a down-trend in ohia and in guava, starting from station 1,
but it is of questionable significance. Other species were
clearly random.
For the same species (Pluchea, Nephrolepis) at site 3,
there is only a normal variability in the. range of ±S-1%.
The area of the 6 exploratory sites is known to harbor
rare threatened or endangered species in 5 families (Table 2).
None of these was found.
Typical vegetation at sites I, 3v, 3 and 5 is depicted.
These views are not unique to one or another, but are common
through the Puna District.
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C. Avifauna
o
There were six study sites covered durine the survey. Arbitrarily
assigned site number$ are shown on the map (sec. F). Due to similarities in'
~ite characteri~tics, primarily vegetation type and location, sites 1 and
2 and sites 5 and 6 are treated as single unit$ in this report. Sites 3 and 4
consist largely of cleared lands with some second growth ve8etation that is
dominated by exotic plant species.
Sites 1 and 2 arc dominated by native plant species in roughly three
different communities: 1) mesic 'ohi'a (Mct~osideros collina) forest with I
a native under$tory of small trees, shrubs, and herbs, 2) 'ohi'a-uluhe
(Dicranopteris linearis) scrub, 3) Andropor,o~ virr,inicus-native shrub~native
herb second growth. Some exotic plants are fou~d in all three communities.
Because the sites are so close and cover such a small area, birds on the site
move freely from one community to another, so I did not attempt ~o characterize
the three communities separately. It should be noted that the actual work
area on site 2.had been cleared at the time of the survey.
Site 3 has been recently cleared, apparently in preparation for papaya
planting. Second growth forest with 'ohi'a, lama (Diospvros sandwicensis),
christmasberry (Schinus.terebinthifoliun), mango (Manr.ifera indica),
Eucalvptus spp., hala (Pandanus spp.), guava (Psidium r.uajava), strawberry
guava (~. cattleianum), and an understory consisting mostly of exotic plant
species.
Site 4 has also been cleared, though clearing must have occurred some years
ago. . Second growth forest contains nearly all exotic species except for
'ohi'a. Exotic plants on the site inClude rose apple (Eucenia jambos),
mango, hala, Albizia spp., guava, strawberry guava, and kukui (Aleuritos
moluccana). Understory plants include thimbleberry (Ruhus rosaofolius),
o o molasses grans (Melinu3 minutif!ora), ti (Cordyline terminalin), honohono
(Commelina diffuna), and Pluchea.
Sites 5 and 6 have been cleared in part. Cleared areas have second
growth ~crub forest including hala, guava, strawberry guava, albizia, 'ahi'a,
molanses grass, sword fern {Nephrolepis spp.), banana, sugar cane, Lantana
camara, and tie Uncleared areas consist of' mesic 'ahi'a forest with native
trees shrub.s and herbs in the understory. The two communities were treated
as one site during the survey because the area is of such small size in relation
to bird movements.
Methods
The six sites were surveyed on 29 and 30 December, including an evening
search for owls. Each site was censused twice although on the cleared sites
bird species present were recorded but not counted. Table 1 contains scientific,
Hawaiian and vernacular names (according to Pyle 1977) on the species recorded,
as well as the survey results.
Data from censuses on sites 1, 2, 5, and 6 were used to calculate two
population measures for each species: percent frequency and relative abundance.
Species not observed during formal census periods are listed, but were not
included in the calculations.
Percent frequency, which gives some indication of the uniformity of
distribution on the site is calculated using this formula.
number of censuses on which species is .det~cted
percent frequency = total number of census x 100
The percent relative abundance, which gives an indication of numbers of
individuals of species relative to one another., is calculated as follows:
percent' relative abundance number of ind~vid\l"lls countC'd in each srecies
= number.of individ~ls counted in all species
-~---.--.-
.. . o o
Percent relative abundance and percent· frequency do not provide estimates
of absolute species densities. However, these values are easily replicated
by other investigators and are appropriate for a baseline survey such as this one.
Results
As the data in Table 1 show, only one native Hawaiian bird, the '10 or
Hawaiian Hawk, occurs in the vicinity of the six sites. Although the scrub
and mesic 'ohi'a forests found on sites 1, 2, 5, and 6 are si~ilar to forests
in which native passerines (~ongbirds) like the 'Apapane and 'Amakihi occur
(Banko and Banko 1979, Conant 1980), they di~ not occur on these sites. This
is probably due to the fact that native plant communities are patchily'
distributed and limited in extent in the general area of the proposed drill
sites. Furthermore, it seems likely that future land uses (e.g., papaya
orchards) are likely to decrease the quality of habit~t for native birds.
The avifauna or the site is typical of disturbed lowland mesic forests
in the Puna district of the Big Island. The exotic bird species present ~n
the sites are among the most common urban and lowland forest birds in Hawai'i.
Impact Assessment and Abatement
Noise generated by proposed drilling is likely to have a disturbing effect
on both native ~ndexotic birds. It is appropriate that mitigative measures
be taken during the breeding season of the '10 (approximately May through
August). ?revention of disturbance to this endangered species by baffling . .
. wells and appropriately timing noise production at wells. is strongly recommended.
o L~terature Cited.
Banko, P. C. ·and W. E. Banko. 19·79. Historical trends in passerine populations in Hawaii Volcanoes National Park and vicinity. Proceedings Second Conference on Scientific Research in the National Parks, 26-30 November 1979, San francisco, California.
Conant, S. (in press) Status and distribution of birds in the Kalapana Extension of Hawaii Volcanoes National Park. Western Birds.
Pyle, R.L. 1977. Preliminary list of the birds of Hawaii. 'Elepaio 37: 110-121.
TABLE 1. List of birds at proposed geothermal site (* = endangered, E = endemic, I = indigenous, X = exotic).
Scientific name
Family Accipitridae (Hawks, Eagles) *Buteo solitarius - E
i~milY Tytonidae (Barn Owls). Tvto alba - X -----
Family Columbidae (Pigeons, Doves) Streptopelia chinensis - X
Family Ti~aliidae (Babblers) Garrulax canorus - X
Family Zosteropidae (white-eyes) Zostercps japonicus - X
Family Ploceidae (Waxbills, Hunias; Weaver Finches) Lonchura punctulata - X
,.~ilY Fringilidae (Cardinals, ( Fir.ches) ", . Cardinalis cardinalls - X
'Carpodacus mexicanus - X
Hawaiian and Vernacular Names
'10 or Hawaiian Hawk
Barn Owl·
Spotted Dove (Chinese Dove)
Melodious Laughing-thrush. (Hwa-mei)
Japanese White-eye
Spotted Kunia (Ricebird)
Cardinal
House Finch (Linnet. Papayabird)
n • Frequency e atlve Sl'te 3
Abundance
observed by workers on· site, but not during survey
heard on site
probable-not recorded
50\ 2\
10,0\ 38\
observed on site
75\ 6\
100\ 54\
probable-not recorded
. probable-not recorded
probable-not recorded
observed on site
observed on site
observed on site
observed on site.
observed on site
Site 4
probable-not recorded
probable-not recorded
probable-not recorded
observed on site
observed. on site'
observed on site
observed on site
observed on site
observed 0:
site
heard on site
50\ 6\
75\ 10\
100\ 26\
25\ 3\
100\ 10\
100\ 45\
o •
D. Botanical Survey
,
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....
Exploratory sites 1 through 6 near the HGPA plant in PlUla were
visi ted on January 13, 1981. A walk-through survey of the vegetation
wa~ conducted at eadl site, focusing on the structure and specics comp-I
osition of thc plant coveT. Structural aspects included height and
closure of the tree canopy, range of trce trunk diallletcrs, vegetation
layers prescnt, plant lifefonns present (ie. '- shrubs, ferns, vines, etc.),
and relativc age of the vegetation. Aspects of species composition
included relative species diversity on the sitc and specie~ type by
origin, ic., ~~tive, Polynesian, or exotic species. Native specics are
those which· are tllought to have reached the Hawaiian Islands without
the aid of man. Polynesian species are those carried to the Islands by
Polynesian (Hawaiian) ilIllligrallts. Exotic spccics are those introduced
to the Island..c; by JIl'ln since the arrival of Qlptain Cook in 1778. No rare
native pl:mt species were encolUltercd during this survey.
As used in this report, the terms "scattcred",. "open", and "closed"
refer to degree of cmopy closure or cover. In a "scattercd" canopy
the CTO\i1lS of the trees cover 5-20 percent of the ground arca; "open"
. c:mopy covers 20-60 percent; "closed" canopy covcrs 60-90 perccnt.
Site 1.
Location: 2800 1 from IIGPA lieU si tc' at headjng umo , or approximately
600 1 from the \'1est cnd of lIina10 Street at heading 1~lOo.
o
Description: TIle forest in this area is successionally yOlUlg and ' ,j
domin:lted hy native species. "Ohi' a (Metrosideros collina) trees from
4 to 10m tall fonn an open canopy, wi th scattered taller 'ohi' a to
15m he ight. TIlcse trees are from 2 to about 2San in diameter, the
average tree heing about Scm in diameter. Below this tree layer is a . .
scattered shruh layer of shorter 'ohi 'a. The ground is entirely covered
in uluhe fern (Dicranopteris linearis), a native species. which f01111S
dense mats from 1 to 3m, deep on the site •. While species di,versity is
relatively low, the uluhe mat hosts scattered individuals of a native
sedge (Machaerina angustifolia), an exotic grass (AndI"QJl?gon virginicu.c;),
an exotic orchid (/\rundina hmnhu."aefolia),. arid an exotic s.hrub (Pluchea
odornta ). Large mango trees grow both to the north and to the east of
the site. Otherwise, evidence of Polynesian or other cultiva:t:ion is slight
on si te 1.
Site 2~
Location: 1840' from the HGP/\ plant at heading 1470 , which places the .
sitc inullediately west of the first bend in the first southerly dirt· road
cast of llinalo St. .
l)cscriptiot~: TItis site ho~ts a t:l11 statured stand of relntively old,
largc trees. TIle canopy is closed in places, more open else,,,here, \vi th
a fl.'\" emergent 'ohi' a at ile:lrly 20m. Generally, the canopy is 12 to 16m
tall :1I1d composed of 'ohi 'a, Person americana, and a few other native and .
exotic·tret' species. A second tree layer reaches to about 8m and is
largely of the n~ltive PsydlOtria .:2. and the exotics Persea americana
and Eugt'nia J:unhos. TI1C vegetation is quite diverse in form; in addition
to the native .md exotic trees, the site is shared hy native and exotic
o o
vines, grasses, shrubs, ferns and native tree ferns. The understory is
open under the tall trees. r~va thickets lie to the north and remn~t
sugarcane field to the south of the site's center. Site 2 shows consider
able evidence of Polynesian occupation, including a Polynesian-introduced
yam (Dioscorea pent!!J?hylla) and the culturally important natives. Pipturus
h:lWaiensis and Freycinetia arhorea in ahluJdance. nle vegetation is
gen~rally of very mixed origin, indicative of frequent ~nd widespread
dis turhance in the pac; t.
Site 3.
Location: 2800' from the IIGPA wbll site at heading l22°.
l~scription: Site 3 lies mostly on recently cleared land south of the
Pohoiki Road. A strip of mixed native and exotic· forest from SO to 200'
wide lies parallel to and south of the road and horders the site. TIlis is
a remnant of relatively old 'ohi'a forest generally taller than 10m and
of high species diversity. TIle vegetation of the site itself, lv-her intact,
is~ mostly scattered YOlUlg 'ohi '~a from 1 to Sm tall, 3em average diameter,
\D\ucrl:1in hy a ~p3rsC shruh laycr. nlC yOWlS a' a upon which this vege-·
tation stands is everywhere covered hy lichens.
Site 4.
I.oc."ltion: 40(lO' from IIGPA well site at heading 10So.
fcscription: 1\"0 v<"get."ltion t)l"lC'S occupy site 4. ~tudl of the site
hosts scattered 'ohi' a of small (ahout oem) averagc di arncter and 2 to
8m height underlain hy a solid mat of U1W1C fern. Exotic shruhs arc
... o o
frequent in this fern mat. These inclucle Psiclium gU:Jjav:J, Pluchea
000 rata , ancl Tihouchina semiclecmdra. Exotic grasses and the bandJoo
orchid (Artmdiml hamhusaefolia) also share the site. Adjacent to this
scatterecl 'ohi 'a/uluhe vegetation is an 'ohi 'a stand of 6 to 14m in
height, ahout lUcm average diameter, ancl wi th an open or occassionally
closed canopy. A second, shorter layer of 'ohi' a reaches to 3m. TIlis
stand is also tmderlaih by a mat of uluhe fern with occassional exotic
specics.
Sitc 4 shows little or no sign of Polynesian cultivation. Spccies
diversity is relativcly low.
Sitc s. IDeation: 4S()() , from IIGPA wcll site at 860 , or about 1000'. from the
west cnd 'of Lauone St. at 860 •
l~scription: n,C vcgetation on site 5 is a very mixed mosaic of native,
Polynesian, and exotic types. n,C area has heen altered to a high
degree hy man's activities. An "ishmd" of tall trees on the site is
composed of matuN 'ohi 'a (6 to 13m tall, 2Scn avcrage diametcr), a few
other nativc tree species, ancl large Polynesian and cxotic tree components.
Shruh~ and vincs are scattercd tmdor this tree layer and arc mostly
exotic species. Exotic gr:lsscs cover much of thc grolmil. n,is "isl~nd"
is surrolulJcd hy a mosnic of renU1:mt sugnrcanc ficld, gU:lva thicket,
. uluhc fern mat, anJ dcn~ely vcgctated ~pcning~ wi th Andropog2!!. vi rginictL<t,
ATlUlclin:l hamhu~al'foli:J, and P~iditml c,uai:lva domin"ltin~. n,C sitc ~hows _______ L , '
mudt cvhk'llcc of POl)'ll'~inn culti vation, inc1u~ing patches of Aleuri tcs
mol1U"·'Ul:l , Pand:mus odoratissintll.';: Cordylinc tcnninn1is and Zinl~iher
%.cTlunhet. Spccies divcr~i ty i~ relatively high. RcnUlant nativc species
o
are indicative of a relatively old and large-statured original forest.
Site 6.
Location: 4200' from lIGPA well site at heading 730 , or 500' from cast
end of llinnlo St. at heading 460 •.
Description: TIlis site overlaps an wldisturhed 'ohi' a/uluhe forest and a
highly disturbed power-line right-of-way. In the intact forest on
ei ther side of the cleared right -of -way the 'ohi' a is successionally
young, of Scm average diameter, and fonns an open C3J10PY of 8· to 12m
in height. Uluhe fern forms a thick (.S to 2m) IMt throughout the tUlder~
story. Species diversity is·low, exotic invasion slight, 3J1d there is
little evidence of Polynesian cultivation. TIle cleared right-of~way
includes much of the southern half of the site. The vegetation here is
young, with scattered 'ohi'a from .S to 2m height. Exotic shrubs, grasses
and ferns dominate the clearing ~ith a considerable native sedge and fern
component as well.
Older native' forest occurs nearer the end of !finalo St. Species
diversity is high, and evidence of Polynesi3J1 pl3J1ting is abundant. TIlis
are:) m:ty host several interesting n:ltive species not found W'i"thin the
actual houndaries· of site 6.
. 1
· . o o
E. Archaeological and Historical )
Site Reconnaissance
o o . ,
On January 5, 1981, a walk-throuch reconnain~ance was conducted to ansess
the archaeolo~ical and historical resources within or adjacent to the six
two-nero proposed ~eothermal.well drilling sites: As Mr. William Bonk of the
Univer:::ity of Hawaii at l1ilo wa:3 previouoly contracted to provide the pre-
con:3truction acsessment of these resources, the purpose of this roconnaiscance . .
and report is to .evaluate the presence or absence of such· remains within the
framework of probable prehistoric or early historic land-lIse patterns dis-
cussed in two earlier Environmental Baseline Report:3 prepared by Drs. B.Z. and
S.M. 5ie(,;01. Adjacent areas were also considered as plans for more .extensive .
facilitie:3 could arise if these wells prove successful. The exact location
of the areas surveyed was determined by marked aerial photo~phs and tax-key
maps provided by Geothermal Exploration and Development Corporation, in addition
to a site visit with l·1r. Edward Craddick.
Of the six well sites visited~ four had been bulldozed or so severely
altered that any possible remains have been disrupted beyond recOGnition. In
concurrence with Mr. Bonk's results (E. Craddick, personal communication), no
evidence of prehistoric or early historic land use was noted on the two unaltered
well sitos. Although both these sltes support a dense and continuous cover of
matted ferns (Dlcr~nopt.cri~ sP.) that obscures most cround features. the probabil-
1 ty appears low that sur!'ace remains went undot.ected, as prehistoric land
utili~~tion and modifica.tion were generally less intensive on relatively young
lava flows than on older, nei~hborin~ subntrates better suited to ar,ricultural
and other nativities. Older substrates adjacent to three of the well sites
(well sitos II, V, and VI, as defined belOW) havo a higher probability of cont.ainin~
•
o o surface remaino, ac each supports r.ither a ve~etation type or a number of plant
,species potentially indicative of Hawaiian land une.
A brief description of each proponed well site fo110wp in the order that
they occur from cast to weott
1. Well site located at the western ed~e of Hina10 3treet, Lanipuna Gardens
subdivision or Nw of Puu1ena Crater.
This we1l'site and the immed1ate vicinity i~ underlain by a
relatively you~ pahoehoe flow supporting predominantly native early suc
cessional ve~etation characterized by open-canopy low-stature (3-12 m
tall) ohia (Metro:;ideri~ co11in3.) with a dense underst'ory of matted
fern coveri~~ 95-100~ of the ground surface. No evidence of former
land use was noted in the several surv~y sweeps attempted thro~~h the
dense underbruoh.
2. Well site located N of Puulena. Crater.
As this well site had already been bulldozed, three vegetation
types ad jacent to thin cleared plot were sampled. 'rwo of t.hese vege-
tation communities contained no surface modifications or direct
evidence of land use. One, south to southeast of the drill sito, con-
sists of t.all-stature (16-22 m tall) closed-canopy ohia forest with a
fairly diverse and structurally complex understory composed mainly of
native specios and restinc on rough pahoehoe or aa. The second veeeta-
'lion type, northoa.~t of tho drill site, appe3.rs to grow on the same, or
a very similar, lava flow, but was composed of 3. dense (10-12 m tall)
oven-~ed stand of rose apple (Eur,enla jambos) with only a sparse
undore:row1~h of exotic r,x'3.SSCS and herb specie,s. Fire spreadi~ 'from
the nei~hborin~ cane fields or another source may explain tho ori~in of
this monospoclflc secondary vcr,ctation, particularly as the lava flow
surfaco appears unaltered.
' .. o o
The third ve~etation type liea on an old cinder cone or vont,
coverqd and partially surrounded by a fairly deep Goil dep03it north
to northweat of the drill nite. Components of thi3 ve~etation community
includ.,.l a mix of native npecies, l'olynesian i~troductions, and
hlntorically introduced exotica. 3cattcrcd laree-ataturc ohia
(18-22 m tall) form an cmer~ent layer above a dense 8 meter tall canopy
of ~ava (Pnidlum ITQajava) and an herbaceous layer dominated by ho~ohono
(Comm'el1na diffur-.a), Oplinmenin hirt.ellun, Bonton fern (Hephrolepis
exaltata) and the Polyneaian Introduced vine, pia. (Dio::;corea. pentaphylla).
Nat1ve spec1es such aD hapuu (Cibotium claucu~ amau (Sadleria sP.) and
lIIamak1 (P1pt.UNC sp.) plus suspected Polynesian introductions such as .
t1 (CorOy1ina termIna1I::;), kukuI (Aleurites moluccana), banana (Musa sp.),
and coconut (CocUG nucifer.a).
As d1scussed in the prevIous reports, plant communities such as' this
may be ~ood indicators of l!awal1an-type land use even in the absence of
defin1 ti ve . surface remaina because they .contain ouch a hiGh percentage
and d1versity of Hawaiian introduced and utilized species in addition to
exotic species that were introduced and became common colonizers of'
d1sturbed lands,durincr the early historic period (i.e. 1800-1850). No
evidonce o£ sur£aco modi£ication or structural remains was ap~arent,
other than a sllla11 collection of bottles and a very rusted cylindrical
mo{al drum.
3; Wall si t.e located. W of tho road leadill8 from the Pahoa-Pohoiki road to
tho University of Hawaii Bxperimental 5tation.
A larr,a.tract of land curroundl~ and lncludin~ this proposed
well site Wa3 recently cleared completely by bulldozing. Older
•
o aerial photo~raphs of the area showin~ a tall and dense canopy su~cre~t
that this substrate wa~ relatively old.
4. lIell site located S of the Pahoa-Pohoik1 road and E of the Un1 vcrsi ty of
Hawaii Experimental !3t.ation road.
'this wcll site and the surroundi~ plot had been previously bull-
dozed, a3 evidenced by the eround surface and older aerial phot.ocraphs.
The ve~etation resemblcs the early successional oh1a-uluhe (matted fern).
community dencribed for well sito I with the exception of smaller-stature
ohia and additional exotic species. Fairly deep pockets of orcanically
der1ved soil mixed with bulldozed lava fraements indicate the sub-
strate's~eater aBe and theoretically.~ive it hi~her probability of
havi~ supported some form of Hawaiian land use.
5~ Well site located a1. the end of Lauone Street, Lanipuna Cardens subdivision.
Both the ve~etat10n and ~ound surface at this well site appear
substantially altored. Scattered stands of s~ar cane, and relatively
.deep .deposits of ·soU mixed with lava blocks and fI'at,:,;mcnts suitable
for suear cane cultivation, sueeest that· this area w~ once under cane
cultivation and abandoned, as were several other nearby ficlds. The
present secondary growth community consists of a thick and diverse
stand of predominantly exotic shrubs and yo~ trees (2-6 m tall) with
a dense Ground cover of exotLc grasses. The only evidcnce of possiblc'
Jlawa1ian-type ,land use wa,s .~tchen or indi vidua.l.s of ti, banana, and .
kultui ~owin~a,lon~ the periphory of this vet;etation type and on or
around isolated knolls or out.crops.
6. ~.Joll aHe off the castern odl~o of Bina,lo St.reet, Lanipuna Gardens subdivision.
This unaltered ail or roUOh pahoehoe flow supports.an early suc
cessional open-to-closed c~nopy stand of ohla (R-IO m tall) with a
o 0 dense Cround cover dominatod by matted fern3. No ourface remains were
noted and, an wlth well slto I, the prob~b1l1ty of flndin~ evldenee of
Hawaiian land une on this relatively young 5ubntrate ,10 low.
:Jurroundin~ i.his well si to io a papaya fii!ld to the north, an
evon you~or lava tlow to the west, a bulldozed swath to the south,
and a tall-stature (22 m tall) clooed-canopy ohia forest with a
sub-canopy of lama (l.Jla.~pmn ferrea.), 'ret.raplas.-'lndra hawalnnnln',
and several kukui. A1thou~h this latter veBetation type is more likely
to contain ourface remainn, particularly in association with kukui,
dense ground cover acrain reduced ground vin1bility and mob1lity, and
no remainn were found.
Recommendations
In termo of p~enervi~~ the cultural resources and history of this area, any
further construction or expansion of geothermal well facilities should be placed
on previounly bulldozed or severly altered sections of 'the propert.y. For well
sitos I and VI the bent alternative areas are those covered by the ohin and
matted fern community as the probab1lity of prehistoric or historic remains ls '
low. Duo to the frequent use of lava tubes by the Hawaiians as shelter, burial
chambers, and other activlties, any lava tubes uncovered duri~ construction
should. be, checked for evidenco of human use and, if found, .:I.rl archaeolor;lot should
b~ c.ont.acted.
A more lntonsivo arc~~eolocical reconna1s~~ce ls recommended if expansion
of woll facllltieo includes the older substrate northwest of well slte,II and
went or'well sUss V and VI, as t.he probability of cultural remalns ln these areas
1s still relativoly hi~h. If substantial prehistoric ntructural features are
•
o d1ocovcrcd, dcc1sione on t~o ocope of work required and the sicrnif1cance of
such. remains could be made in conjunct1on w1th the respon~ible State of Hawaii
aeency (1I1~tor1c Sitca 3ect1on of the D1v1~1on of State Parke, Department of
Land and Natural Roeourcoo).
-
o o Bibliography
Bevacqua, R. 1972
and T. Dye
Crozier, S.H. 1971
Ellis, w. 1969
Archaeological Reconnaissance of Proposed Kapoho-Kalapana Highway, District of Puna. Island of Hawaii. Report 72-,). Dept.. Anthropology, B.P. Bishop Mus.
and D .B. Barrere Archaeological and. Historical Survey of the Ahupua' a of Pualaa. Puna District, Island of Hawai1. Report. 7.1-1. Dept. Anthropology, B.P. Bi:mop Mus.
Polynesian Researches. Hawa1i. Rutland, ·Vermont. Charles E. Tuttle Company~
Ewart. N.D. and. M.L.K. Luscomb 1974 Archaeological Reconnaissance of Proposed Kapoho-Keaukaha
Highway, District of Puna, Island of Hawa1i. I1s in Anthropology Department. Bernice P. Bishop Mus.
Handy, E.S.C. and E.G. Handy 1972 Hative Planters in Old Hawaii. Their Life, Lore, and
Environment. B.P. Bishop Mus. Bull. 2)).
Lyman, C. 1924
Pickering, C. 1840-41
Around the Horn to t.he Sandwich Islands and California, 184.5-18.50. Being a Personal Record Kept by Chester Lyman. Hew Haven. Yale University Press.
Journal Kept While on the U.S. Exploring Expedition, 18.38-1840. Ms in the Academy of Natural Sciences, Ph11~elph1a, Pa.
Soil Conservation Service 1972 Soil Survey of the Islands of Hawaii. Washington D.C.
Wilkes, c. 1845
U.S. Government Print.ing Off1ce.
Harrative of the United States Exploring Expedition During the Years 18)8-1842, Under the Command of C. Wilkes, U.S.N. Vol. 4. Philadelphia. Lea and Blanchard.
• o O . The following summarizes some aspects of the known cultural hiotory of
thin port.io~ of South Puna, baaed on early historic journaln, ethnOGraphic
material and Dorot.hy 9. 13arrere's historical survey of Pualaa., an ahupuaa.
north of the :;~.udy area. Keahialaka, the ahupuaa. in which the six ~eotherma1
well oiteo lie, is mentioned in several early journals an a populous coactal
vi1l~~e but these accounts provide little or. no specific descriptions of the
vil1aee or the adjacent upland slope.
ElliS', in hin journal of an 1823 tour of /lawaii Island, states that his
coastal path from Kaimu north to Keahialaka was, other than portions of Kona,
the most populous· otretch of land on the Island of Hawaii (Ellis 19691290-297).
The relative importance of Keahialaka within this populous stretch may be
indicated by its havine boen the residenco of "the chief or eovernor"'of Puna
in 1823 and that as an ahupuaa it extends farther inland (i.e. to an ~levation l
of about 1,100 ft.) and truncates the immedia~ely neiehborin~ ahupuaa.
Arter an archaeolo~ical survey of ·coastal South Puna (1.e. Kapoho to
Kaimu) Bevacqua and Dye s~cest that, of the seven early historic villages
reported in this stretch, only Keahialaka and two other vill~~es still have
det.octn.ble out'face remains. These remains include the Mahinaa.kaka Helau, a
brackish pond, and several probable ~ricu1tura.l complexes (e.a. walled
enc10ouroo and mounds) (Bevacqua and Dye 1972115-16,24). From the early
accouni.o, it. :1ppearn tMt most of the 1301.0 prchistoric.- early h1storic
population in South Puna was concentrated in settlcmonto scattered alon~ the
. coast aceomp:\.nied by cultivated. areas or plantations of varying size. The
distribution a.nd oxtent of t.he:.o settlemonts and cultivated areas most
stronr.ly reflect tho roeion'A topocraphy and mosnie of hiGhly variable sub-
st.rato types resultl~~ from Puna's act1ve volcanic history. Areas with
conot.al confll~uratlons amenablo to flshi~, . and underlain by older substrat.es •
o o with accumu1ationo of or~anic soi10, tended to support 1ar~er more concentrated
populations.
Land-use pattornc of the inland rc~ionn are 1enn clear, as is tho rcla-
tionnhip between thccoantal and inland rc~ionn. Tho pnly nubstantial inland
settlement 1n th1s section of Puna (W1lkes 1&~5Il8J,222) wan located ncar the
present day Pahoa. It is described as beinu ourrounded by laree plantations of
dryJ.and or non-1rril!ated. taro, .banana, cuear cane, and,.ti,s1mllar to tho:Je
found on Kapoho Cone and possibly ~ther areas, such an well slte II, wlth
comparable ash sUbntrates. Several accounts describ1n~ the inland region
south of Pahoa tell of trails crossin~ a ro~h varied~erraln, a few scattered
plantations, and several overn1r,ht shelters.
The use of the inland. areas for agriculture is discussed by Handy and
Handy in their work ~n traditional Hawaiian practices~ Generalizing from
various sourcec, they succest that much of the upland slopes and "forested"
lands from Kapoho to upper Kapn.a.hu, except where interrupted by young lava
flows,- wari planted tn dry-land taro (Handy and lIandy 1972:541) t Other crops
and useful plants such as ti, b:lnana, and kuku1 'could accompany thece taro
patchca, bc1nr; pl:mtcd in either a scattered ma.nner or organ1zed 1nto
"w1ndbreak" or boundary-markinc hodeea. A.D. LobenstQ1n's 1885 map dep1ctlnc
"Ancient Cult1vatinc Grounds" de:f1ned by different subEltrate types, sU{",r:ests
a patchy distr1bution for some inland plantat10ns (Croz1er and Uarr~re
From the o.'11'ly 1800' n on, the population of 30uth Puna ste~ily dec11ned
due to a. nerien of !'Iovere opidemics and cmlc;rotion of the people to lart';cr
vi1lar,es and 1.own'Scaterinr, to increased trnde, G~ar cnne cultivation, and
ranchinr.. Barrhro believes that most of the nub~ictcncc-1cve1 land-use
practices were osncntia11y ~onc by lA50. After a.n 1850 la.w enabled Hawaiian
. . . "
" .
o o commoners to claim ownerohip of lando (l.e. kulcana lands) they had cultlvated
for gencrationo, only two ouch claims were awarded in all of Puna compared
with numerou~l awards claimed and granted elsewhere. Ownership of much of the
land was ret.ained in lar~e un1 ts by eleven alll and the go:vernment. Wlth the
ahupuna of Pualaa as a representat.ive example of the re~ional depopulation as
depicted in the Tax Asscssment Books, the number of recorded taxpayers, other
than the owner, dropped from eight in 1859 to two in 1865, to one in 187',
and finally to none bet.wcen 1875 and 1889 (Cro7.ier and Barrere 1971:16-19).
Land una in Puna from 1870 to the 1940's focused on cattle ranchi~ with I .
variouo 1e~~ees and owners runnina loosely tended herds on marginal pacture
lando, small scale ventures in coffee and other crops, the harvestin~ of
timber and hapuu (Clbotium spp), quarry1n~ stone,' and the growint; of cugar cane.
Primarily in support ot 3~ar cane cultivation, the Hawaii Consolldated Rai1-
way, Ltd. operated a railroad alona a 4O-foot casement that rUns northeast to
southwest rouch1y a half mlle south of the six well sites.
Rocont lava flows and trends in land use that utilize bulldozers for
c1oarinr; ~~icu1tural plots (e.~. for papayas, ant hurl um.s, orchids, etc.) arid
subdlvision lots are rapidly reduclng the amount of unaltered land posslbly
containing evidence or prehistoric land usc. Such developments make the proper
study of tho archaeolo~ical or historical remains found in this region even
more import.ant to understandinr; the cultural history of Puna.
· ,. o o
P. Site Maps
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.l1A.'=.A.I'lA -----11~l·lqrcijlJ.~
•
o o
G. Personnel
. .f. f
•
Q'
PERSONNEL
1. General Operations and Environmental Chemistry for Ecotrophics
S. M. Siegel
B. Z. Siegel
2. Avifauna S. Conant
3. Botanical Survey R. A. Holt
4. Archaeology, History H. McEldowney'
o
' .. •
c o KNCY.ffl AND POTENTIAL GEOTHERr-1AL RESOURCES
The southern part of the Island of Hawaii is
dominated by an asymmetrical shielf volcano (Kilauea)
and its associated east rift zones. The active East
Rift of Kilauea, which passes through the Puna District
as a linear, zone approximately 3 mile ±nland f'rom the
coast, was recently proved prospective for geothermal
resources at a site drillled by the Hawaii Geothermal
Project (HGP) near' Kapoho. The HGP-A well is located
adjacent to the lands cited in this application. That
well yielded temperatures and pressures from a geothermal
reservoir capable of generating up to 3 megawatts of
electrical power-- a resource of commercial significance.
The BGP-A wellsite was selected on the basis of geophysical
anomalies together with other evidence. Similar anomalies
exist at other locations along the East Rift Zone from
kilauea Crater to Cape Kumukahi, and establish a geothermal
resource potential on the property proposed to be leased.
Geophysical studies indicate that the geothermal
reservoir tapped by the BGP-A well extends in an elliptical
~aspion·around the well. However, in order to make a
definitive determination of the existing reservoir boundary,
. exploratory wells must be drilled.
Exhibit "B"
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© @ To: Planning Cou,mdssion, County of Hawaii
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The undersigned, a partner in Ecotrophics, is environmentally familiar with, those parts of the Puna District currently of interest for geothermal resource exploration. This includes the area within an arc of approximately 3 miles radius extending from the ENE (toward Kapoho) to due S. of Lava Tree Monument (toward Opihikao). Within this area of ca 28 sq. mL, about 4 sq. mi., or 14% has been intensively sampled ornithologically, botanically, ecologically, geoChemically and archaeologically. Environmental baselines have been determined for HCP-A (Univ. of Hawaii), Ashida (GEDCO) and DaiichiSeiko (GEnCO) prospects. The results of these are available in a series of reports including
a •. 'Rerlsed Environmental Impact Statement for the Hawaii Geothermal Research Station Utilizing the HGP-A Well at
,Puna, Is~and of Hawaii. 22 March 1978.
b. Bawa:1:1. Energy Resource Overviews. Work done under a grant from the U.S. Department of Energy by contract (03415609) through the Lawrence Livermore Laboratory of the University of ' California. B.Z. Siegel, Project Manager. Hawai'i Natural Energy Institute and the Pacific Biomedical Research Center, University of Hawaii. In 7 Volumes, June 1980.
c. tnv. Baseline Reports prepared for GEDCO by Ecotrophics on 20 MarCh 1980 and 20 September 1980.
On the basis of 11 years experience in the study of the environmental impacts of natural geothermal processes in Hawaii and over 5 ,years experience at HGP-A I submit herewith the following recommendations in re the current GEDCO request for permission for geothermal. exploration atthc!' well field. consisting of port~ons of L.P. 8094, L.C. ~ 8SS9-B, Apana 15 to Wm C. Lunalilo and Grant 3209 to Rubert Rycroft, ~e.ahialak.a and Pohoiki. Puna Bawai~'.
~n as lINch as one-half of the sites proposed for drilling lie within 0.15 mi. of intensely studied areas and the remainder W'ithin 0.36 lid. or less of thos'a aforement~oned, well characterized areas, there are no hazard-~ E!. adverse impacts anticipated ,!!:2!!. ~ activities and operations prior ~ actually contact:ing geothermal fluid .!!. depth ,~ bringing !!E!. water, steam, gases .!:!!! dissolved solids II !!!!. surface.
And' inas much as the nec$Ssary baseline studies for future assessment of env1ronment~ degradation is in progress and will be completed by Ecotrophics within 30 days fo1~owing this hearing date of 17 December, 1980, I reC01ll-~nd that permission be granted GEnCO to carry out the exploratory drilling program as proposed.
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INTERNATIONAl. INC.
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June 15, 1981
MEMORANDUM
TO: Mr. James Detor
FROM: Robert T. Chuck
SUBJECT: Plan of Operations, Barnwell Geothermal Corporation
We have reviewed the material submitted to you by Barnwell Geothermal Corporation as their Plan of Operation concerning Lease No. R-3. The material, specifically the "Geothermal Drilling Program for Barnwell Geothermal Corporation", does not adequately fulfill the requirements of Plan of Operation as outlined in Section 7.2 of Regulation 8.
We recommend the following be submitted:
o A Plan of Operation that includes all of the items as outlined in Section 7.2 of Regulation 8.
o Sectional drawings of each proposed well and well head facilities.
o Detailed plan map of each well site, access roads, water supply reservoirs, and other construction plans, in cluding surveyed property boundaries.
o Up-dated information and records on the recently drilled Lanipuna No. I Well.
ROBERT T. CHUCK
DL:ko
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GEORGE R. ARIYOSHI
GOVERNOR OF HAWAII
MEMORANDUM
TO:
FROM:
SUBJECT:
STATE OF HAWAII DEPARTMENT OF LAND AND NATURAL RESOURCES
Robert Chuck DOWALD
OIVISION OF LAND MANAGEMENT
P. O. BOX 621
HONOLULU. HAWAII 96809
April 6, 1981
James J. Detor Land Management Division
J-
Geothermal Resources Mining Lease No. R-3, Barnwell Geothermal Corporation
DIVISIONS: CONVEYANCES FISH AND GAME FORESTRY LAND MANAGEMENT STATE PARKS WATER AND LAND DEVELOPMENT
Transmitted herewith for your review is a copy of Barnwell's March 30, 1981, letter together with the material which accompanied it. Let me know if the plan of operations is okay and we will list it for Board action.
Attachments
cc: Hawaii Board Member Hawaii District Land Office
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J BA~'Wt~B GEOTHE~Mj~'{CORPORATidN
8/ APR 1 . A/O: (J March 30, 1981
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Mr. Susumo Ono, Chairman State of Hawaii Department of Land and Natural Resources P. O. Box 621 Honolulu, Hawaii 96809
Reference: Geothermal Resources Mining Lease No. R-3
Dear Mr. Ono:
Enclosed please find our check in the amount $770.00, as requestect:;~ _; in payment of the first years minimum rental.
We are also enclosing our plan of operations, as required under Rule 7.2 of Regulation 8, comprised of:
1. Geothermal Dri 11 iog Program.
2. Location map showing drilling sites, and access road. Water supply will be provided by 400,000 gallon reservoir at site and shallow disposal pit which will be excavated alongside the drilling rig.
3. A baseline study with revision for follow up monitoring by Dr. S. M. Siegel.
4. Geological data as covered in our application for lease repeated herein for ready reference at this time.
We keep sound measuring devices on hand at the drilling sites, and will take periodic readings during the course of operations.
ECC/sm Enclosures
Very truly yours,
BARNWELL GEOTHERMAL CORPORATION
cc: New York Office - W/enc1. Mr. S. Eisenstat, N. Y. - W/encl. Mr. C. Lum, Hilo - W/encl.
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2828 PAA STREET. SUITE 2085· HONOLULU. HAWAII %819 • TELEPHONE (808) 839-mo· TELEX 7238672 • TELECOPIER (808) 833-5577
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GEOTHERMAL DRILLING PROGRAM
FOR
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BARNWELL GEOTHERMAL CORPORATION
PREPARED BY: Willis R. Craddick Clarence J. Mason (Water Resources International, Inc.)
FEBRUARY 1, 1981 (REVISED COPY)
THIS IS THE SOLE PROPERTY OF BARNWELL GEOTHERMAL CORPORATION AND IS NOT TO BE USED OR REPRODUCED WITHOUT THEIR PERMISSION.
o
TABLE or"CONTENTS
GENERAL DRILLING INSTRUCTIONS
SPECIFIC DRILLING INSTRUCTIONS FOR GEOTHERMAL WELL:
General Scope of Work
Site Preparation
Mobilizati.on
Drill ing Pr.ogram, All Measurements RKB Phase I - Conductor Hole Phase II - Surface Hole Phase III - Intermediate Hole Phase IV - Production Hole Phase V - Production Test
Drilling Fluids Program Phase I - Conductor Hole Phase II - Surface Hole Phase III - Intermediate Hole Phase IV - Production Hole
El ectri c L.o.gging Program
Casing Program
Cementing Program
Coring and Testing " .
Deviation Surveys
Well Records
o
"Page
1-2
2-3
3
3
3
4
5
5-6 6"
6
6-7 7
7-9
9
9
10
10
10
. 10
o o General Drilling Instructions
1. Run Totco deviation survey every 120 feet or as needed to control well bore deviation. Hang Totco wire1ine sheave on hook to enable movement of drill pipe while "running inll, and IIpulling out". Keep drill pipe moving, except while shot is gOing off to prevent differential (wall) sticking.
2. Enter on daily log mud temperature 1I0ut ho1e ll and lIin ho1e ll once every tour until we reach 1200 feet. After 1200 feet take temperature every 4 hours and enter on daily drilling log.
3. Each crew is to have one simulated "blow-out drilP per week, with the results entered in the daily drill log. Limit "dri11 11 to 15 minutes. At no time during a "blow-out drill", is mud to be actually pump'ed into the hole with any preventer closed.
4. Have core barrel (in good working order) on the location for use, if required.
5. Strap weld all subs and/or bits run under hole-openers.
6. Run drill pipe float valve in 8-3/4" hole and keep a "wet plug ll
with valve in open position on rig floor at all times.
7. Keep Bagasse, Nut Hulls, Cot~on Hulls, Je1-f1ake, Mica (coarse and fine), Lignite, Bentonite, etc. on-site at all times. Keep covered and protected from the rain at all times.
8. All measurements will be from the ~ of the Kelly Bushing (RKB).
9. Keep hole full of mud at all times, except when drilling without returns.
10. Check operation of B.O.P.E. each round trip or daily, whichever occurs first. Enter in the daily log.
11. Do not use spinning chain on drill collars, use chain tongs ~. Torque 11 II drill collars to 110,000 ft. lbs. Torque 811 drill collars to 56,000 ft. 1bs. Torque 6-3/4" drill collars to 36,000 ft. lbs.
12. Make entries of all pertinent information on drilling recorder chart.
13. Fill out daily drilling reports complete. Log all voids and loss circulation zones.
o o 14. Procedure for mixing air foam mix - ADD to 100 barrels of water in
the fo 11 owi ng sequence:
a. 75 1bs. soda ash over 15 minutes period, b. 1250 1bs. bentonite over 45 minutes period, c. 40 1bs. CMC along with bentonite over 45 minutes period, d. 30 gals. detergent directly into suction pit as mix is
being transferred from mixing pit to suction pit. Over the period of time it takes to transfer the mix.
15. Hold weekly safety meetings (15 minutes) and document with weekly safety meeting attendance records.
16. Contact State Department of Water and Land Chairman or his designated representative well in advance so that he has time to travel to the drill site to witness the pressure tests, etc. Phone numbers are: 961-7279 - Hilo, and 548-7643 - Honolulu.
17. All operations to be conducted in accordance with the State Regulation No.8, Rule 9 governing Geothermal Resources and Drilling, June 1978.
18. Geologist will be on site as soon as circulation is established or after the 13-3/8" casing is set.
Specific Drilling Instructions for Geothermal Well
WELL PROJECT: LOCATION: OPERATOR: PARTNERSHIP: CONTRACTOR: CONSULTANTS: PREPARED BY: Bill R. Craddick/C1arence J. Mason APPROVED BY:
Operator
APPROVED BY: Consultants
" "General "Scope"of"Work:
1. Prepare access road and well site, mobilize drilling rig.
Date
Date
2. Drill a 26 inch hole and case with 22 inch casing to a depth of 68 feet.
-2-
o o 3. Drill a 17-1/2 inch to 20 inch hole and case with 13-3/8 inch
casing to depth of elevation -400 feet.
4. Drill a 12-1/4 inch hole and case with 9-5/8 inch casing to a depth of 3800+ feet.
5. Drill a 8-3/4 inch hole to total depth of 7000+ feet, or as required by the operator. -
6. Flow-test well, install geothermal well head, demobilize drill rig and restore drilling site.
A. SITE'PREPARATION
1. Prepare access road, drill site, and reserve pit - per GEOCO Plan No. 7904.
2. Construct water reservoir (240,000 gals. capacity), and install liner.
3. Construct cellar per GEOCO Plan No. 7903.
4. Install IIdead-men"(guy line anchors).
B. MOBILIZATION
1. Mobil i ze WRI dri 11 ing ri g #4.
2. Mobilize Cement Pumping Unit, Bulk Storage Unit, and extra storage capacity as needed.
3. Mobilize WRI electri.c logging unit.
C. "DRILLING PROGRAM, ALL MEASUREMENTSRKB
Phase'I'~ Conductor'Ho1e 1. Dr; 11 a 12-1/4" p; 1 ot hole with mud to 102 feet. Start pi 1 at
hole by center punching inside existing 30 inch casing with 26 inch hole opener and 12-1/4 inch pilot bit.
2. Open 12-1/4 inch hole to 17-1/2 inch to 100 feet.
3. Open 17-1/2 inch hole to 26 inch to 68 feet.
4. Bail mud out of hole down to 68 feet.
5. Cut off 30 inch pipe at cellar floor and remove same.
6. Run 22 inch casing and cement. (Refer to casing and cementing programs).
7. Nipple up flow-line and air drilling head to 22 inch casing.
-3-
o o Phase II - Surface Hole l~ Drill a 17-1/2 inch hole with air mist, depending on compressor
availability, or mud (refer to drilling fluids program) to a depth of 600 feet or elevation +20 feet. If air mist is circulation media, change over to mud at elevation +20 feet. Notifyrepresentative·of·the State'upon reaching elevation +20
·feet.
2. Bail hole until clear water is obtained. Catch three, one gallon samples. Turn over a one gallon sample to State representative.
3. Run wireline water probe to establish water level. Enter results on daily drilling report.
4. Run wireline temperature survey-top of water and bottom of hole and enter results on daily drilling report.
5. Finish drilling 17-1/2 inch "pilot hole" with mud to 13-3/8 inch casing depth to elevation -400 feet. (Make 10 feet extra hol e).
6. At this point, an attempt to establish full (100%) circulation with mud will be made - (refer to drilling fluids program on page 6). The results will determine the 13-3/8 inch casing, cementing method.
7. Condition hole for running casing.
8. Run 13-3/8 inch casing - refer to Casing Program on page 9.
9. Cement 13-3/8 inch casing - refer to Cementing Program on p.age 9. WOC time will be determined by retardation of cement.
10. Cut off 22 inch casi~g at cellar floor.
11. Cut off 13-3/8 inch casing and nipple up as per GEDCO Plan No. 7902. Test the weld on 13-3/8 inch l-IKM Braden Head before nippling up B.O.P. stack complete with choke manifold and kill 1 ines. ,I .
12. Pressure test casing,. choke manifold valve and flanges with blinds rams closed - 600 PSIG for 30 minutes. Pre'ssure test pipe rams and Hydril after starting in hole - 600 PSIG for 30 minutes. All pressure tests to be witnessed by State.
13. Drill out with 12-1/4 inch Mill Tooth Bit and water. Pressure test casing (600 PSIG for 30 minutes) after drilling out each tool. After drilling out cement to 10 feet above the shoe, pressure test entire 13-3/8" casing at 600 PSIG for 30 minutes.
-4-
o o Phase III - Intermediate Hole 1. Drill a 12-1/4 inch hole with mud (refer to Drilling Fluids
Program on Page 8), and TCI Bits to 9-5/8 inch casing depth, (casing depth to be determined by bottom hole temperature minimum .250°F) and Lithology. Land casing in solid formation.
2. Condition mud and hole for logs {make "short trip" to check for fill ).Delay'this operation~ ifpermissible by the State.
3. Run logs - (refer to Logging Program on page 9). Delay this operati on ~ . if· permi ss i b 1 e . by . the State.
4. Condition hole for running 9-5/8 inch casing.
5. Lay down'dril1 collars.
6. Run 9-5/8 inch casing - {refer to casing program on page 9}.
7. Cement 9-5/8 inch casing to surface - {refer to cementing program on page 10}, WOC to be determined by retardation of cement, or minimum of 24 hours.
8. Cut off 9-5/8 inch casing, install WKM expansion spool, and lay down 5 inch drill pipe. Install expansion spool and nipple up as per GEDCO Plan No. 7902. Change pipe rams to 4 inch.
9. Pressure test casing, well head flanges, and choke manifold with blind rams closed - 1000 PSIGfor 30 minutes. (To be witnessed by State Representative).
10. Pick up 8-3/4 inch Mill Tooth Bit, 6-3/4 inch drill collars and 4 inch drill pipe.
11. Pressure test pipe rams and Hydril - 1000 PSIG for 30 minutes.
12. Drill out with water all cementing staging tools, float collar, and cement to within 10 feet of casing shoe. Pressure test casing after drilling out D.V. tools if any and also after drilling 10 feet above the cement shoe, pressure test at 1000 PSIG for 30 minutes. (To be witnessed by State Representative).
·Phase·IV·~·Produttion·Hole 1. Drill out cement and casing shoe with 8-3/4 inch rerun Mill
Tooth Bit by-passing all 'contaminated mud to reserve pit.
2. Drill 8-3/4 inch hole with TCI Bits to total depth with mud.
3. Test after reaching minimum temperature of 390°F, as indicated by drilling break or lost circulation.
-5-
o o 4. Condition hole for logs.
5. Run logs . (refer to Logging Program on page 9) if no further hole drilling is required.
Phase·V·-'Ptoduction'Test 1. Displace mud in hole with water using 4 inch drill pipe (no
collars) float Bit Sub and 8-3/4 inch bit at bottom of 9-S/8 inch casing.
2. Using high pressure air compressor, depress fluid in the hole to the bottom of the 9-S/8 inch casing. Shut in the well and let the fluid heat up to 1000 C+. Release the pressure out of the choke line and flow the well.
3. Flow test well - (under direction of GeothermEx).
4. Kill/cool well with water.
5. Make trip with drill string to check depth and clean out to bottom. If hole stays open, proceed to step #6.
6. Lay down drill pipe and tools. NOTE: Continue to pump water down 9-S/8 inch casing during step#S and #6 to assure well control. If hole does not stay open during flow-test, a slotted 7 inch liner will be considered.
7. Close 10 inch WKM Valve, remove B.O.P. stack and nipple up geothermal well head.
D. DRILLING FLUIDS PROGRAM
'Phase'I'~·ConductorHole 1. Spud-Mud, Water, Bentonite and Lime. Viscosity sufficient to
clean hole.
'Phase II ~ Surface Hole 1. Drilling.blind with mud, use freshwater/gel mud with the
following properties, and maintain: .
a. PH-8.S-9.S with caustic soda - ADD to make up water.
b. .WT.-below 9.3 lbs. per gallon.
c. Vis.-SO/80 (as needed) with Bentonite.
d. W.L.-No control.
e. No samples - drill cuttings.
2. Drilling with circulation or partial circulation, use fr~sh water,' gel/chemical, low sol ids mud with the following properties, and maintain:
-6-
o o a. PH-8.S-9.S with caustic soda - ADD to make up water.
b. WT.-be10w 9.3 lbs. per gallon with water - AODED at shale shaker.
c. Vis.-4S/80 (as needed) with Bentonite.'
d. W.L.-10/lS cc (100 PSIG-30 min.) with CMC.
e. Gel strengths-Int.-O, 10 min.-10/20, with Tannex - ADD at flow-line through chemical barrel.
f. Sand content-below 1% of volume.
g. LCM-S/15% as needed to maintain circulation.
h. ,Samples: 2 sets, 10 feet intervals, WID.
3. Drilling with air mist (using 1-1050 CFM Compressor).
a. Inject 12/15 GPM of air foam mix into air stream. Air foam mix formula and procedure for mixing in General Drilling Instructions.
b. Samples: 2 sets, '10 feet intervals, WID.
PhaSe III -Intermediate:Hole 1. Use fresh water gel/chemical low solids mud with following
properties, and maintain:
a. PH-10.5-l1.5 with caustic soda - each tour will maintain treatment through chemical barrel at flow-line.
b. WT.-below 9.3 lbs. per gallon with water at flow-line.
c. Vis.-45/50 sec. (1500 cc in-l qt. out with marsh funnel).
d. W.L.-below :10 "cc OO~PSIG"30 min.) with CMC - ADD slowly through hopper with bentonite).
e. Gel strengths-Int.-O, 10 min.-0/5 with CC-16 depending on loss circulation. _
f. Sand content-below 1% of volume.
g. LCM-S% or as needed to maintain circulation.
h. Samples: 2 sets, 10 feet intervals, WID.
PhaseIV'~'Pt6duttion'H61e 1. Use fresh water gel/chemical low solids mud with following
properties, and maintain:
-7-
---------______ ,_'\~
o a. PH-10.S-ll.S with caustic soda - (each tour will maintain
treatment at flow-line through chemical barrel).
b. WT.-below 9.3 lbs. per gallon with water at flow-line.
c. Vis.-38/40 sec. with bentonite.
d. W.L.-below 10 cc (100 PSIG for 30 minutes) with high viscosity CMC. ADD through hopper slowly along with bentontie.
e. Gel strengths-Int.-O 10 min.-O with Spersene and XP-20.
f. Sand content-below 1% of volume .
. "g. LCM none-unless partial loss circulation occurs.
h. Samples: 1 set, 10 feet intervals, WID.
2. Procedure to establish full circulation at completion of 17-1/2 inch Surface Hole, Phase II.
a. Pullout hole.
b. Establish fluid level with wire1ine fluid probe.
c. Go in hole with drill pipe (open-ended) to within 50 feet of bottom.
d. Pump in through drill pipe previously mixed mud (slug) with heavy c·oncentration of l01 (15/20%). Monitor fluid level while pumping. Continue to pump mud slug, if fluid is rising as mush· as 65% or more,of input until circulation is established. If fluid rise 'of 65% or more is not achieved~ stop pumping and pull drill pipe up above mud level. Wait two hours and monitor fluid level or until fluid level stabilizes, and then repeat procedure. NOTE: Watch for bridges or fill, when running drill pipe back in hole. Pos'ition bottom of drill pipe 50 feet above fill, . for repeati.ng procedure. After several attempts with negative results, attempts to establish full circulation' will be abandoned.
e. If full circulation is established, continue to circulate by passing shaker screen for three full circulations.
f. Trip out with drill pipe-pick up one double of drill collars (8 inch) and bit sub (no float), (remove jets from bit). Go in hole and clean out to bottom, closely monitoring pit levels.
-8-
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o o g. If full circulation is maintained, reduce concentration
of LCM, closely monitoring pit levels, to 5% by volume, by screening out excess LCM. If full circulation is not maintained severity of loss circulation will determine if further attempts should be made.
E. ELECTRIC LOGGING PROGRAM
Phase I -'None
'Phase II -'None
Phase III - Open hole 10gs-FOC, 'CNL, BNC, IES, and HRT log. C.B.L. and casing caliper aft~r 9-5/8 inch casing is cemented and cleaned out of within 10 feet of shoe, or as required •
. 'Phase IV - HRT, Kuster Geothermograph, CNL, FOC, BHC and Sonic Log, or as required. All logs to be' run after 8-3/4 inch hole is drilled to total drilling depth.
F. ., CAS I NG ' PROGRAM
Phase I - 68 feet, 22 inches x 3/8 inch wall welded casing, set on bottom of 26 inch hole. Bevel bottom joint. '
Phase II - elevation -40afeet ~13-3/8 inch, J-55-54.50 lbs. feet. Buttress thread casing set 2 feet off bottom of 17-1/2 inch hole. Casing strings makeup will be determined by cement method. Weld shoe' and ta'ck weld bottom four couplings (top and bottom). Torque joints to API specs.:13-3/8,inch stab-in and shoe should be on the site.
"Phase'III ";'3800+ (actual depth to be determined by hole temperature) 9-5/8 inch, J-55-;40 lbs~/feet buttress thread casing. Set 3 feet off bottom to allow for thermal expansion. Casing string will consist of guide shoe, automatic fill up float collar, centralizers 10 feet above shoe and on every third coupling to surface cement staging tool or tools positioned at depths determined by hole conditions and cement baskets on joint below tools. Weld only on float equipment, cement stagi,n9 tools and bottom four couplings. (Tack weld bottom of couplings). NOTE: '9-5/8 inch casing will have to be' centered in 13-3/8 i n'ch Braden Head to assure pro'per sealing of thermal pack off element. Pick up B.O.P. stack for visual . inspection before cement is brought to surface.
, 'Phase'IV - Evaluation of flow-test will determine the necessity of a 7 inch slotted liner.
-9-
o o G. CEMENTING PROGRAM
Phase I - Cement to cellar floor with ready mix cement consisting of a 8000# construction grade cement, and 2% calcium chloride, ~o be poured from surface.' Have 100% excess on location. Wait 30 minutes after initial pour in annulus (1 yard) then proceed to pour, monitoring rise in annulus and inside 22 inch casing. (Stop pour, if cement is going down hole or coming up inside 22 inch casing. Wait 30 minutes and continue pour).
Phase II - Cement to cellar floor with thermal cement (to,be blended on location under the direction of Howco representative) by.method to be determined by hole condition.
1. Conventional cementing utilizing stab-in shoe.
'Phase'III-.Cement to surface Braden Head Valve with.thermal cement, blended on location under the direction of Howco representative, conventional multi-stage cementing to be determined by hole conditions.
H.CORING AND TESTING
Coring intervals to be determined by GeothermEx and Operator.
I. DEVIATION 'SURVEYS
Every 120 feet of new drilled hole or as.necessary to control well bore deviation. Wing stabilizers or roller reamers positioned in the drill collar_string may be necessary in the 8-3/4 inch hole to control well bore dev'iation and/or differenti a 1 sti eking of the drill collars.
J.WElL'RECORDS - To be filed with the State.
-10-
~ " -.- c o BARNWELL GEOTHERMAL CORPORATION
Mr. James J. Detor Land Management Administrator State of Hawaii
August 27, 1981
Department of Land and Natural Resources Division of Land Management P. O. Box 621 -Honolulu, Hawaii 96809
Reference: Plan of Operations-Geothermal Resources Mining Lease No. R-3 Your Letter of July 2, 1981
Dear Mr. Detor:
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We are enclosing supplementary information requested by DOWALD. It will be noted that certain information was previously submitted and responds to some of the items in Section 7.2 of Regulation 8 as identified by us in this supplement.
Work on Lanipuna Well No. 1 is not yet completed. A report will be made by Geothermex and submitted to you as soon as this has been compiled on completion.
ECC/smEncl.
cc: ~ALD Mr. R. Higashi Mr. G. Taguchi
Very truly yours,
BARNWELL GEOTHERMAL CORPORATION
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2828 PAA STREET, SUITE 2085· HONOLULU, HAWAD 96819· TELEPHONE (808) 839-7720· TELEX 7238672 • TELECOPIER (808) 833-5577
-.
o o Supplementary" Information "Requited"Under"SeCtion"7.2"o f"Regu1ation 8
a. Proposed locations - refer to location map previously submitted. Elevation is +600 feet above derrick. See typical well design drawing attached.
b. Existing road - refer to location map. Short lateral road approximately 100 feet dozed northwest to the site with gate.
c. Water is hauled from Pohoiki stand pipe in 6000 gallons tanker to 400,000 gallons pit type, butyl lined reservoir at site. A meter has been installed at the Department of Water Supply stand pipe.
d. No campsites or air strips will be used.
e. No other potential surface disturbances are contemplated.
f. Slopes are gentle in a seaward direction, with rapid drainage into the porous formation.
g. Excavated pit beside the rig holds any effluent or waste.
h. See Dr. Siegel's report previously submitted.
i. See Geologist's report previously submitted.
j. See Plan of Drilling Operations previously submitted.
k. Follow up monitoring to be performed by Dr. Siegel.
1. Drawing of typical well and well head facilities attached.
ECC/sm-8/27/81
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GEORGE R. ARIYOSHI
GOVERNOR OF HAWAII
29 DEPARTMENT OF LAND AND NATURAL RESOURCES
P. O. BOX 621 ',I th- W/~ fER &
HONOLULU. HAWAII 96809
.. :.,. . Lv'. ;'·IENT
Bonorabl. AI14l"ew Leyin Houe of "pres.tau .. The Bleventh Legi.lature State of 8awail Honolulu, Bawaii
Dear Sir.
'ua_u ODo .M ..... CHAIRMAN BOARD OF LAND" NATURAl RESOURCES
EDGAR A. HAMASU DEpuTY TO THE CHAIRMAN
DIVISIONS: CONVEYANCES FISH AND GAME FORESTRY LAND MANAGEMENT STATE PARKS WATER AND LAND DEVELOPMENT
Thank you for your letter of April , •• ndin9 me a copy Of Audrey Bear lupaty·. complaiat on the Barnwell Geotthezmal Corporation well.
Ttle well in question i. located on private land in wbJ.ch 'the ain ... l r:"hta are aot ra.erve4 to the State. BoVeYer, the Laft4 Board ha. appro.,.d a lea.. to Bunwell oOYU'iaCJ other pri vau land in "hich the Stat.e 408. haYe the lliaeral rl,h"s but. the 1 .... baa not been 's.ue4 a. yet.. Acaor4iJl,ly, we will awaltt r •• olut.ion of the noi •• staRda .. d complaint. before aotuall! issuing the 9eothermal lea.. an4 will oheck wit.h the Bea ~ Department and count.y ill thi. retard.
very t.ruly yours,
SUSUMU ONO Chalr.Ban of the Board
..,,,,. .... ,,,..., ... "''' ... ~ '" LIn. T""x:r-fJ"."J'" VJ:..V LLVrMJjN 1
~ ;om: iF; D~t~: ~/(2:J;( FI~~ .. ~ 1 To Initial . i //" 1< ~.,. J
~./1 ': ."'\ i Robert T . Chuck I ~\ e Me I'":?,, 1----~ _ Takeo FuJU _Take action by
I -------! James Yoshimoto _Route to your branch
1 ---------
------------
Manabu Tagomorl
George Morimoto Hong Fong Chang Herbert Morimatsu George Miyashiro
Harold Sakai Leslie Asari
Albert Ching George Matsumoto Daniel Lum Paul Matsuo, Noboru Kaneshiro
--- Edwin Sakoda
i .
... - --- --------
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(
Review & comment.
_Draft reply by ___ _
For Information
Xerox distributed
_Acknowledge receipt
Jane Sakai -----Doris Hamada ---Lorraine Nanbu ---Jean Slarot -----ElsIe Yonamine ---
---a. """-_________ _
o 0 Spe~NRY HAAUUO PETE~Ll; HOUSE OF REPRESENTATIVES ViceSpeokeT v'?HE ELEVENTH LEGISLATURE DANIEL J. KIHANO \ Ma' 't Leader ~~NIS R. YAMADA ST ATE OF HAWAII (' ,
Majonty Floor Leader STATE CAPITOL C / KATHLEEN STANLEY HONOLULU, HAWAII 96813
;': !~ ,-1"1,' '!
FlI1t District ANDREW LEVIN
Second District RICHARD M. MATSUURA HERBERT A. SEGAWA
Thin! District YOSHITO TAKAMINE
Fourth District VIRGINIA ISBELL
Fifth District MARK J. ANDREWS WILUAM W. MONAHAN
Si~th District HERBERT J. HONDA ANTHONY P. TAKITANI
Seventh District ROBERT D. DODS DONNA R. IKEDA
Eighth District BARBARA MARUMOTO
ttFREDERICK WILUAM ROHLfING Ninth District
TED T. MORIOKA CALVIN K.Y. SAY
Tenth District KEN KIYABU BERTRAND KOBAYASHI
Eleventh District tKINA 'U BOYD KAMAU'I PAUL L. LACY, JR.
Twelfth District DAVID M. HAGINO MAZIE K. HlRONO
Thirteenth District GERALD de HEER CAROL FUKUNAGA BRIAN T. TANIGUCHI
Fourteenth District RUSSELL BLAIR KATHLEEN STANLEY
Fifteenth District BYRON BAKER MICHAEL MINORU LIU
Sixteenth District DENNIS MASARU NAKASATO TONY NARVAES
Seventeenth District GENE ALBANO JOHN WAlHEE
Eighteenth District CONNIE C. CHUN TOM OKAMURA
Nineteenth District CLARICE Y. HASHIMOTO EWISE YAMASHITA TUNGPALAN
Twentieth Disb'ict DANIEL J. KIHANO MITSUO SHITO
Twenty First District JAMES AKI HENRY HAAUUO PETERS
Twenty·Sccond District GERALD T. HAGINO YOSHIRO NAKAMURA
Twenty-Third District CHARLES T. TOGUCHI
Twenty-Fourth District MARSHALL K. IGE TIMMY WONG
Twenty-Fifth District WHITNEY T. ANDERSON JOHN J. MEDEIROS
Twenty-Sixth District RUSSELL J. SAKAMOTO
Twenty-Seventh District RICHARD A. KAWAKAMI TONY T. KUNIMURA DENNIS R. YAMADA
t Minority Leader ttMinority Floor Leader
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April 9, 1981
Mr. Susunu Ono, Chairman State Board of Land and
Natural Resources Kalanimoku Building Honolulu, Hawaii 96813
Dear Mr. Ono:
Enclosed are copies of letters from Audrey Bear Zubaty, which were already sent to the Hawaii County Planning Department and the Hilo office of the State Health Department, regarding noise generated from a geothermal well of Barnwell Geothermal Corporation.
Ms. Zubaty's complaint about noise is another in a long line of complaints about the same subject from numerous residents in the Lower Puna area on the Big Island. Although I thought this problem had been corrected, apparently it has not.
I have requested from George Yuen and Sidney Fuke of the Hawaii County, a review and some corrective action in this matter. It has been suggested that Barnwell was supposed to install a muffler system but has not. If this is accurate, I would hope that both the State and County of Hawaii would do whatever is necessary to force the company to meet its obligations to our residents.
As the head of the board which approves land leases for geothermal energy exploration and development, I am calling your attention to this matter, as it is my understanding that a condition of the agreement between the State and a lessor is the strict compliance to noise standards.
It is my further understanding that leases must be secured for lands with state mineral rights and that Barnwell is in the process of applying for a lease but may not have been operating on such lands at the time stated in Ms. Zubaty's complaint. In any case, my staff has confirmed that the noise pollution laws of the State and County of Hawaii do apply.
----------------,-~,-.,-
o
Mr. Susumu Ono Page Two April 9, 1981
o
Due to a question of whether compliance has been made with respect to noise standards, I feel that an investigation of Barnwell Geothermal Corporation is warranted at this time before any state lease is granted for this company's future activities on the Big Island.
May I please hear from you on this matter at your earliest convenience. ~
lk
Enclosures
Very truly yours,
ANDREW LEVIN, Representative First District of Hawaii
cc: Audrey Bear Zubaty
---------------------------"~''''-
t .. o State Dept. Of Health Environmental Health Services 75 Aupuni st. Hilo, HI. 96720
Dear Health Dept:
o P.O. Box 1125 Pahoa, HI. 96778
Enclosed you will find a co~y of a letter sent to the County Planning Dept regarding excessive noise levels emittin5 from the Barnwell geothermal well near Leilani Estates in ~una.
It is illy u..'1derst:3.nding that your d~partment is empowered to monitor the dB! levels, and set appropriate standards which are applicable to the peaceful rural nature of the area, which the geothermal developers will then be required to follow. At the present, there are no u..'1iform st~ndards or requirements for sound bafflement.
The noise level appears significantly higher after midnight, and monitoring, when it pccurs, s~ould be done in the Malama Street area at that time, as well as during the day.
Tes tine of our CE.. tc -(lme;} t ,~:':.. tar sys terns is a!"~other im;>orta ~l t CaLC e rn. ~e de0end ~olely on catchment ~Bter for our source of potable water. Base line studie3 of &t least five different combinations of collection sv3te~s 10cE..ted in Leilani ~3t~~S Gust be made im:ned ia te ly bef ~re the COIrl :'081 -tion of heavy :Iie tals is s i5nif1can tly altered "Dy t~.e iril1ing. _;::a::;;18::; of vs.r1ous collection com-o:"na tions are : b2~\.scl s;.:':.-,)el roof and dou;h'oo;;r pool, 81:in:;:le :'001 and concrete block t~tl"l};:, ;slvaniz::d iron roef and 2tainless steel tar..}:. The Health D2-:-t :::Just set sts.rJ.dards for the "dE..ter systew3, <ind should arr&nge a scteduls of ~eriojic te~tinG forthe l~ter, in order to ~ssure that citizens will not 3uffsr ill effect2 from hea vy mets.ls.
~lea~e have a re~r~s2ntative contact ~e at 965-9373 to 1st me kno"\\" wh3. t the o.e3Jart::e;.:t :pla.:ls to jOe
cc: CoUuty ?lannins Dept. Dept. of land and natural resouraes (state) Hr. Tom Fujii ;·~r. Andy Levin
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DIVISION
'rom: ~. Date: ,f
fo Initial
Robert T . Chuck ---Takeo FuJU ---James Yoshimoto
/..,..--- Manabu Tagomorl ---___ George Morimoto
Hong Fong Chang Herbert Morimatsu George Miyashiro
Harold Sakai --- Leslie Asad
--- Albert Ching . / ___ George Matsumoto -;7- Daniel Lum --- Paul Matsuo --- Noboru Kaneshiro --- Edwin Sakoda
See Me
_Take action by ____ _
_Route to your branch
Review & comment
_Draft reply by ____ _
For Information
Xerox distributed
_Acknowledge receipt
Jane Sakal -----Doris Hamada ---Lorraine Nanbu ---Jean Siarot -----' Elsie Y onamlne ---
••••••• I II II I
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Dear Mr. Ohairman;
P.O. Box 11 25 Pahoa, HI 9677.'3 April 1, 19.'31
Enclosed are copies of letters sent to the Hav'raii County Planning Denartment and the state Board of Health. I live in the Leilani Estates area of the Puna District on the Big Island, w-hich is covered by Tax Map Keys 313 011-044. It is located across the street from the original geothermal test site. Barnwell Industries present drilling site is about .~ to 1 mile away.
The noise from that site is excessive. Someone within the governmental system must be responsible. Since you are the who just had the hearing on Maui (1) approving the Kapoho geothermal sites, then you must have some control over the methods of drilling and pollution levels~
ones
Perhaps you and your commission could meet here in Pahoa and speak directly to the concerned citizens about your role in the geothermal plan for our district. Please contact me at 965-9.'373 and we can arrange a convenient time.
Sig.ned .. , ~~~~. '~ (lul. [;.K«J au::> AUdrey~ear Zubaty
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State Dept. Of Health Environmental Health Services 75 Aupuni St. Hilo, HI. 96720
Dear Health Dept:
Q P.O. Box 1125 Pahoa, HI. 96778
Enclosed you will find a copy of a letter sent to the County Planning Dept regarding excessive noise levels emitting from the Barnwell geothermal well near Leilani Estates in Puna o
It is my understanding that your department is empowered to monitor the dB! levels, and set appropriate standards which are applicable to the peaceful rural nature of the area, which the geothermal developers will then be required to follow. At the present, there are no uniform stsndards or requirements for sound bafflement.
The noise level a~pears significantly higher after midnight, and monitoring, when it pccurs, should be done in the Malama Street area at that time, as well as during the day.
Testing of our catchcl1ent lrater systems is another important concern. ~'re depend solely on catchment l'rater for our source of potable water. Base line studiea of at least five different combinations of collection systems located in Leilani Estts.3 must be made immediately bef~re the com::,osi1ion of heavy metals is significantly altered by t!'le drilling • .-::x8.:r..ples of various collection combinations are : baked enq'~el roof and doughboy pool, shingle roof and concrete block tanIr, galvanized iron roof and stainless steel tank. The Health D2")t must set standards for the ,,;a tel' systems, and should arrange a schedule of "]eriodic testing forthe 1ffi tar, in order to essure that citizens will not suffer ill effects from heavy metals.
~lea8e ?lave a re~)r~ssntative contact Ule at 965-9373 to let me knoiv wha t the depart:::::.ent plans to do.
cc: County ?lannins Dept. Dept. of b,nd and natural resouraes (3tate) Mr. Tom Fujii I'lr. Andy Levin
! .... - , .. ··,:0,
Dear Mr. Chairman;
.0 P.O. Box 1125 Pahoa, HI 96778 April 1, 1981
Enclosed are copies of letters sent to the Halraii County Planning Deoartment and the State Board of Health. I live in the Leilani Estates area of the Puna District on the Big Island, I'Thich is covered by Tax Map Keys 313 011 -021-4. It is located across the street from the original geothermal test site. Barnwell Industries present drilling site is about ~ to 1 mile awayo
The noise from that site is excessive. Someone within the governmental system must be reS1JOnsible. Since you are the ones who jus t had the hearing on Maui (I) approving the Ka'poho geothermal sites, then you must have some control over the methods of drilling and pollution levels o
'-:'~\"-";'I"f"" Pe'rha'ps'yoti."and' your commission could meet ,here, in' 'Pahoa "and"",.·."-<""",;·,·,, ,'.' speak directly to the concerned citizens about your role in the geothermal plan for our district. Please conts,ct me at 965-9873 and we can arranke a convenient time.
Signed, '7 I Y. !lvi H.-r Pet?r to.A:J(l. tW
Audrey'13ear Zuba ty{/
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o State Dept. Of Health Environmental Health Services 75 Aupuni3t. Hilo, HI. 96720
Dear Health Dept:
o P.O. Box 1125 Pahoa, HI. 96778
Enclosed you will find a co~y of a letter sent to the County Planning Dept reg~rding excessive noise levels emitting from the Barnwell geothermal well ne~r Leilani Estates in Puna.
It is illy underst3.nding that your department is empowered to monitor the dB! levels, and set appropriate standards which are applicable to the peaceful rural nature of the area, which the geothermal developers will then be required to follow. At the present, there are no uniform st~ndards or requirements for sound b~fflement.
The noise level a~De3.rS signific~ntly higher after midnight, and ::lonitoring, lihen it poours, :;hould be done in the Malama Street area at that time, as well as during the day.
Tes ting of our oa tch:"!len t "ira. ter sys tems is another import~::.t t c one ern. ~Ie de rend solely on C3. tcllmen t ,,)'a ter f or our source of pota ble w~ter. Base line studies of at le~st five different co~binations of collection systeills located in Leil~ni Esttes must be made im:ned ia te ly before the com:,os i tion of heavy ill3 tals is s ignificar:. tly altered by t~:e drilling. _~JCa:y.ple::; of various collection comb=-nations are : ba~~d en~~el roof and dou;hboy pool, shingle roof and ooncr3te block tank, ;alvanized iron rocf and stainless steel tank. The Healt~ D2~t must set standards for the ~~ter sy3te~s, and should arrange a scl:edule of :;erio:iic testing forthe Iratsr, in order to assure t~at citizens will not suffer ill effects from hea vy metals.
:::lea::;e ?lav8 a re~:;r~s.:;ntative contact ~e at 965-9373 to let me kr:.01i wha t the depart::eYlt plans to :io.
cc: County ?lannins Dept. Dept. of l~nd and natural resouraes (3tate) Mr. Tom Fujii l'~r. Andy Levin
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~ Fro~: ,~ D~te: 2> (I 'l-- FUin: ________ _
i To InJUal , -. i Robert T . Chuck 1---~ .' Takeo FuJll
! g;~ James Yoshimoto , _ ' Manabu Tagomori
l' George Morimoto
Hong Fong Cha --- Herbert Morl tsu ---___ George Miya
___ LeSli~arl
~~Chlng
__ / . Gyorge Matsumoto v /Daniel Lum
I =,/ Paul Matsuo. _ / ' ,,= Noboru Kaneshiro V-. , flf} Bdwin Sakoda
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4 --r--- ------I
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~>(:'{_f" l._~ .. , ·'.1 -, ' , I
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See Me
_Take action by ___ _
_Route to your branch
Review & comment
~raft reply by ___ _
For information
Xerox distributed
~cknowledge receipt
Jane Sakai -----.;:OOris Hamada
Lorraine Nanbu ---__ ---=J ean Slarot Elsie Yonamlne ---
--- .... ------------
" o BARNWELL GEOTHERMAL CORPORATION
Mr. Susumo Ono Chairman of the Board State of Hawaii
March 5, 1981
Department of Land and Natural Resources P. O. Box 621 Honolulu, Hawaii 96809
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THE DEVELOPMENT OF 'GEOTHERMAL "ENERGY" IN HAWAII
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The electricity supply system in Hawaii is at present fed from a multiplicity of thermal power plants which include diesel engines, steam turbines and a gas turbine. This preponderance of fossil fuel-fired power plants has made the Hawaii Electric Light Company and its consumers particularly vulnerable to the recent drastic increases which have taken place in oil prices.
In an effort to obtain relief from this situaion investigations have been made into the possibilities of indigenous alternative energy sources existing in Hawaii. Attention has been focused upon geothermal energy as the most promising alternative to the importation of fuel oil. Barnwell Industries believes that the development of the geothermal potential of Hawaii offers a means of providing the population with a dependable supply of power divorced from rate increases attendant to the soaring price of fuel oil. Barnwell's faith in geothermal energy as a viable energy source for Hawaii is evidenced, not only by its past program of scientific testing, but also its corrmitment to the exploration drilling program in which it is actively engaged at present. This activity is a natural continuation of the exploration and investigations carried out by Barnwell and its associates in the field of geothermal energy since 1973.
"Geothenma1 Cost Factors The generation of geothermal power depends entirely upon an explo
ration process which is attended by a measure of uncertainty. Using the best scientific testing equipment available, there can be no guararitee that any particular well will produce steam in acceptable quantities, under usable pressure and temperature conditions. The cost of producing steam from individual wells is obviously affected by all these factors. In addition, some wells are found to be dry, having either nO output or
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2828 PAA STREET, SUITE 2055 • HONOLULU, HAWAU 96819 • TELEPHONE (808) 839-mo • TELEX 7238672 • TELECOPIER (808) 833-5577
Mr. Susumo Ono DLNR
o o March 5, 1981 Page Two
insufficient output to be judged economically viable. Therefore, the drilling success ratio has a considerable impact on the cost of producing geothermal steam.
Once a geothermal field is in successful operation, it will require a continuing maintenance program to sustain production. Such a program, including drilling new wells and reworking old wells, would involve considerable expense and increase the cost of producing electricity from the associated power station.
The cost of a geothermal power plant is easier to estimate, but even here there are uncertainties arising from such aspects as dissolved solids, non-condensible gases and pressure and temperature conditions which can affect plant costs. It is clear therefore, that any attempt to develop a specific price before the relevant well output data has been collected, and the characteristics of the reservoir determined would be premature.
Pricing Aspects When an electric utility contemplates the purchase of geothermal
power, its economic break-even point occurs when the average geothermal cost per kilowatt hour equals its avoided cost represented by the least cost alternative method of generation (avoided cost). This concept has been recognized in the Pub.lic Utility Regulatory Policy Act (PURPA) which requires a utility to purchase electricity from renewable energy sources by paying up to its avoided cost. If the price of geothermal power were rraintained strictly at the level of avoided costs there would be no financial benefit available to the consumer from the development. of an indigenous energy source •.
Barnwell Industries believes that electricity consumers should receive some financial advantage from geothermal development. Strict adherence to the principle of parity with avoided costs is, therefore, contrary to Barnwell's approach to the subject of geothermal development ·in Hawaii.
It is to the rising total of fuel cost savings that electricity consumers will look for financial relief following the corrmissioning of geothermal power plants. While accepting this in principle, Barnwell Industries believes that such savings should not be solely reserved for electricity consumers and that the developer should also benefit. The obvious sourt:e of these funds would be a portion of the fuel cost savings, and the pricing formula' suggested by Barnwell Industries recognizes this. . .
. '
Mr. Susumo Ono DLNR
o o
Pricing'Formu1a for·theSupply Of Geothermal Power
/
March 5, 1981 Page Three
As mentioned, the passage of the Public Utility Regulatory Policy Act established the principle of pricing electricity from geothermal power plants at the level of the utility's avoided cost. This resulted in various formulae being developed, all aimed at ensuring avoided cost parity. Si~ce Barnwell Industries beleives that pricing based upon strict avoided cost parity is not appropriate to Hawaii it has elected to put forward a formula based on a pricing philosophy b~1oW-,a.votded costs rather than to rely on a formula developed througfl1)OE studies.
The fo 11 owi ng provi s i ona 1 formul a has, therefore, been developed from first principles by Barnwell and its associates. The formula is intended to apply to an alternative plant installed in lieu of a traditional fossil fuel plant and must be re-evaluated for each additional increment of geothermal capacity. It is proposed with a view to meeting the desires of the Sate of Hawaii and at the same time preserving an equitable balance between the interests of both the electricity consumers and the developer.
Provisional Formulafor·theCosting of Electricity . GeneratedfrOm'GeOthermal . Steam
Cost $/Kwh = FpA+BA + Ce- + D~ JA. L:Kilowatt Hours Generated
A = Capital cost of proposed alternative generation plant.
B = Cost of fuel consumed by such plant during initial year of operation.
C = Cost of operation and maintenance for such plant during initial year of operation.
D = Cost of administration and management for such plant during initial" year of operation.
p = Variable constant factor to cover interest and depreciation escalation over the life of the generation plant.
~ = Yearly escalator component reflecting increase in cost of heat consumed over base year.
~ = YearlY,escalator component reflecting increase in plant operation and maintenance costs over base year.
c(> = Yearly escalator component reflecting increase in administrative and management costs over base year.
>L = Reduction constant factor to reduce cost per kilowatt hour generated to meet Barnwell pricing philosophy.
Mr. Susumo Ono DLNR
SUl11l1ary
o March 5, 1981 Page Four
Barnwell Industries and its associates have faith in the development of geothermal power in Hawaii - a faith which is being demonstrated tangibly by the drilling program at present under way for geothermal steam. Barnwell believes that the development of an economically viable source of geothermal power will be of considerable benefit to Hawaii in several ways.
Firstly, the State will receive tax and royalty revenues which could be used to improve local conditions. Secondly, the development of this indigenous energy source would reduce dependence on the price escalations of the international oil market and offer some protection against future oil shortages. Thirdly, by buttressing electricity prices against oil price increases, electricity will become relatively cheaper, and economic activity thereby encouraged.
In making this presentation, Barnwell Industries recognizes the fact that the State is anxious for geothermal development to bring financial gains to electricity consumers as well as result in a reduction in imported fuel oil. Barnwell pledges its support to these objectives while continuing to acknowledge the many uncertainties attendant upon any exploration project.
Respectfully submitted,
BARNWELL GEOTHERMAL CORPORATION
/J~~ -Andrew F. Blumenthal Vice President and Assistant Secretary
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COUNTY OF HAWAII
o RECEIVED_
PLANNING DEPAR1.\~v1ENT
25 Aup8nY[hGJE!r . AllLQ, OivAII 08720
DIV. OF WATER & LAND DEVELOPMENT
Dear Property Owner: TMK: / -3-07; 7; ;131 ;;Jb) 31 /-I.f.-OZ; 1/
Special Permit Application Keahialaka, Puna, Hawaii
Tax Map Keys 1-3-08:Portions of 6, and 1-3-09:Portion of 7
HElWEHTT. MATA YO~III Ma~·o,
SIDNEY 1\1. FlJKE UI'r<'IO'
DUANE KAMJlL\ Deputy llI,enu,
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1981P c::)
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You are hereby notified that a request for a special permit to allow a geothermal exploration and evaluation by drilling up
;0 fil e-rr: < rr, c:
to sixteen ~J:§) wells on approximately 724 acres of land situated wi thin t.he State-"Laii"a-Use Agricultural District ~s been submitted· by the p~.!:i tioner, BarnYlell Geothermal Exploration. --"--
The property involved is located along the south side of the Pohoiki Road and about 1,500 feet from the HGP-A well, at its nearest point, adjacent to and on the makai side of the Leilani Estates and Lunipuna Gardens Subdivision, Keahialaka, Puna, Ha~aii.
A public hearing on the subject among others will be held beginning at 7:30 p.m. on Wednesday, October 15, 1980, in the Councilroom, County Building, South Hilo, Hawaii.
You are invited to comment on the application at the hearing or subrr.i t vlri tten comments prior to the hearing date.
smn
Sincerely,
~~-J t)lanning Director
Enclosure
cc: State Land Use Commission
~~------------------.-------- ..•.. ~ . .,-
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sPCCIAL PeRMIT REQUeST
GeOTHERMAL EXloLORATION
POHOI KI 'C$ I'(EAH IALAI'(f'.., PUNA, HAIAlAIi
lAX MAl"" K~ : I-::~-OS: CP,"?, IV AND 1-3-0V:7
APPl-ICA"-lT : iBARNlI'JELL 6EOTHeRMAL CORPORATiON
HfJMIQ
KAHO:"UA 0 KAHAWAL~ CRATER C,
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GEORGE R. ARIYOSHI GOVERNOR OF HAWAII
. Z~ \i '2: L\ 1) STATE OF HAWAII
DEPARTMENT OF LAND AND NATURAL RESOURCES
Mr. B. C. Craddick President.
DIVISION OF LAND MANAGEMENT
P. O. BOX 621
HONOLULU. HAWAII 96809
Barnwell Geothermal Co~r.tion 2828 Paa Street, Suite 2085 Honolulu, HI '6819
Dear Mr. Craddick:
Sua_u Ono ..... xxx
CONVEYANCES FISH AND GAME FORESTRY LAND MANAGEMENT STATE PARKS WATER AND LAND DEVELOPMENT
Subject: Geothermal Resources Mining Leue No. R-3, Barnwell Geothermal Corporation
This will aclmowled •• the receipt ·of your '. CDBISunication of Maroh 5, 1981, detailing your pricing methodology relative to the qeothermal lease approved by the Board .t. ita .. etiDg' of February 13, 1'81. We will new finali •• the 1 •••• document and will let you know wben it is ready for .xecut.ion. In the interim please forward a check in the a~unt of $770, in payment of the first yea .. minimum rent.al.
~hi. will also acknowledge the receipt. of your indemnity bonds (Nos. 901789 and 901790) and d.signations of agent for Lanip.a Well No. l.aDd No.2. As soon as the plan of oper.tions required under Rule 7.2 of Requlation 8 has- been submit.ted to U8 and approved by t.~. Soard of Land and Natural Resource., we will issue the drilling permit:8.
Enclosure
t!C: Hawaii Board Member
Very truly youra,
SUSUMU OJfO Chairman of the Board
Hawaii District Land Office ·/fJowALD
J·.Jt)syd
ROLL CALL
MINUTES
--- -~--._- O -- o
MINUTES OF THE MEETING OF THE BOARD OF LAND AND NATURAL RESOURCES
DATE: February 13, 1981 TIME: 9:00 A. M.
PLACE: DLNR Board Room, Room 132 Kalanimoku Building
1151 Punchbowl Street Honolulu, Hawaii
Chairman Susumu Ono called the meeting of the Board of Land and Natural Resources to order at 9: 05 A. M. with the following in attendance:
MEMBERS
STAFF
OTHERS
Mr. Moses Kealoha Mr. Takeo Yamamoto Mr. Stanley Hong Mr. Roland Higashi Mr. Thomas Yagi Mr. Susumu Ono
lVIr. Kenji Ego Mr. Libert Landgraf lVIr. Robert T. Chuck Mr. James Detor lVIr. Wayne Hirata Mr. Herbert Yanamura Mr. Mason Young Mr. Roger Evans Mr. Ralston Nagata Mr. Charles Neumann Mr. Noah Pekelo Mrs. Joan K. Moriyama
Deputy A. G. Dona L. Hanaike Deputy A. G. Johnson Wong Mr. Clifford Lum (Item F-7) Mr. E. C. Craddick (Item F-3) Mr. S. M. Eisenstat (Item F-3) Ms. Judith Forster (Item F-10) Mr. Francis Yamada and
Mr. Robert Tom (Item F-24) lVIr. George Masuoka (Item F-33) Mr. Norito Kawakami (Item F-34) Mr. Robert M. Cool (Item F-34) Mr. Boyd C. Saderup (Item F-34) Mr. Boyce Brown (Item H-5) Kauai Bible Church Rep. (Item H-l) Mr. Peter Garcia
The minutes of January 9, 1981 were unanimously approved as circulated, on Mr. Hong's motion and seconded by Mr. Yamamoto.
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o o He specifically referred to today's board actions on the hiring of a young man (Item C-2) and a young woman (Item C-3). They both have participated in the Forestry's YACC programs. Mr. Landgraf said it has given the young unemployed adults an opportunity to do on-the-job training to qualify and to enter into the adult professional employment ranks.
ITEM D-1 APPOINTMENT OF SOIL & WATER CONSERVATION DISTRICT DIRECTOR
ACTION The board, on Mr. Yagi's motion and seconded by Mr. Hong, unanimously appointed Mike O'Keefe as a Director of the Molokai-Lanai Soil and Water Conservation District for a term ending on June 30, 1983.
PERMISSION TO ENGAGE THE SERVICES OF BISHOP MUSEUM TO PROVIDE ARCHAEOLOGICAL SERVICES FOR THE LALAMILO AGRICULTURAL PARK
ITEM D-2 SITE
ACTION
ITEM F-3
ITEM F-7
-----------------------------------------------------------------Unanimously approved as submitted. (Higashi/Yagi)
The board deviated from the printed agenda and took up the items in the following order to accommodate those people in the audience.
BARNWELL GEOTHERMAL CORP. APPLICATION FOR GEOTHERMAL MINING LEASE ON RESERVED LANDS AT KAPOHO, KANIAHIKU, POHOIKI AND KEAHIALAKA, PUNA, HAWAII
This was an application for a direct lease of geothermal resources on reserved lands in the Puna area. The applicant, Barnwell Geothermal Corporation, has been assigned the occupier's rights by the land owners who were listed in the submittal. The terms and conditions of the proposed lease were the same as the other two geothermal leases which the board acted on previously.
Mr. Detor said the applicant has submitted a criteria, which were circulated to the board members, under which they propose to operate.
Mr. Higashi questioned whether the applicant shouldn't be J . T. Trading Company, Ltd., Auto Imports of Hawaii, Inc. and Promised Land Corporation, instead of Barnwell Geothermal Corporation as indicated in the submittal, and mentioned the subleases that came up at the last board meeting on the Lyman's properties.
Mr. Detor explained that since Barnwell Geothermal Corporation has been assigned the occupier'S rights by the land owner, they are the applicant. In the case of the Lyman property, Mr. Detor said the land owner is not Kapoho Land Partnership. The owner assigned the occupier's rights to Kapoho Land Partnership, who in turn are subleasing it to the Dillingham-Thermal joint venture.
The board was not clear in this area and suggested that the staff check this out. While waiting for the answer, the board took up the next item.
(See pages 5 to 7 for further discussion and action on Item F-3.)
W. A. LAVALLEE REQUEST FOR REVIEW OF VALUE ESTABLISHED FOR ABANDONED RAILROAD RIGHT-OF-WAY SEGMENTS RUNNING ACROSS LOT 721, WAIAKEA HOMESTEADS, 2ND SERIES, WAIAKEA, SOUTH HILO, HAWAII
This was a request for reconsideration of the price set on the sale of an
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ACTION
-7 ITEM F-3
o Mr. Hong said their logic is that the value should be lower because they are nothing but a detriment to the parcel. However, without those remnants, the applicant won't be able to consolidate and subdivide, so the value should be greater, Mr. Hong said.
Mr. Lum said that is true. except that in May 1978, the highest and best use of that area was Ag-3 .
Mr. Higashi had no objection to the request for deferral for sixty days, and so moved. Mr. Hong seconded, and the motion was unanimously carried.
(Continued from Page 3)
The board was prepared to discuss Item F-3.
Mr. Detor said the question was whether people who have been assigned the occupier's rights can be considered the applicant. He said the statutes and the rules and regulations bear that, so they can be the applicant.
Mr. Higashi asked whether the applicant is prepared to follow the guidelines set up by the board, and also whether they are aware that we have a criteria set up in which they have to show justification why we should issue a direct lease, rather than to go through public auction.
Mr. E. C. Craddick. representing the applicant, said they have outlined those areas in their application. He also referred to page 4 under Summary of Public Benefits and highlighted some of the benefits.
Mr. Ono asked how long it will take to get locally-trained crews to work independently. Mr. Craddick said they have a crew of four on each shift. They have all Hawaiian crews. He said it took them about five years to train the real well qualified, eager men. Mr. Craddick said it is anticipated that this training. program will ultimately provide experienced local trained 'contractors and eliminate the need of hiring mainland employees.
Mr. Hong asked what would they say is the net worth of that partnership today, and referred to the Financial Resources Section. Mr. Craddick said the net worth is the same. When you drill a well it becomes a capitalized item, so it becomes a net worth item. Barnwell Geothermal Program, Hawaii limited partnership, was initially capitalized in exress of $3 million, Mr. Craddick said.
lVIr. Hong said on the commencement and completion dates of the well, they have three years to begin drilling. He asked what their time schedule was.
Mr. Craddick said they already started on the first well on Monday. He said it takes them about a mqnth or two to test it.
Mr. Ono asked to comment on the consumer benefits on page 5.
Mr. Craddick said they paid a lot of attention to this. They realize the importance of not only developing an alternate energy source, but developing this in an economical manner so it would have a favorable impact on the price of energy in the state, particularly on the Big Island. Their policy is that they don't consider it a success unless they do provide it at a price
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ACTION
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under the fossil fuel rates. At the present time, he said there is a Federal law that requires the utility to buy an alternate energy source at the available cost. Mr. Craddick said one stipulation they have on this is whatever savings that are realized is passed on to the public. That describes their policy.
Mr. Higashi asked whether they are going to use Public Utility Regulatory Policy Act (PURPA) as a vehicle for pricing. Mr. Craddick said they don't intend to use that in the methodology or structure in their pricing.
Mr. Higashi said when he met with Mr. Craddick, they discussed the methodology. He said he had assumed that a ·copy of the methodology of figuring the price would be submitted with their proposal.
lVIr. Craddick said the problem is they don't want to disclose too much of the precise methodology that they used. He said there are other competitors.
Mr. Higashi realized that, but he said the prior applicant did supply the board with some formula, based on cost and on a very complicated process. They also submitted to the board a pricing methodology as a philosophical point as to how they are going to sell energy.
Mr. Higashi said if he had something in writing, which was promised sometime ago, he was going to introduce that today. He would feel more comfortable, he said, in issuing a direct lease if he had something like that. He realized that the prior applicant discussed the same feeling that it is complicated, but they cooperated.
A Mr. Eisenstat said they have taken the position from the outset that they would not key their price to the price of fossil fuel. He said the record will indicate that they did this on their own initiative. They will initially start it out low, and then they will escalate it in a manner that is not keyed to fossil fuel, and they are prepared to put that in writing. With reference to the question of PURPA, he said Mr. Craddick set forth their position very clearly. Their biggest problem is in dealing with the utility. They will not rely on PURPA, but the presence of PURPA hopefully will remove the utility towards coming together with them and the other developers in the area.
Mr. Higashi said he would like to ask for deferral of this item until such time as we have some methodology as to the way of arriving at the price.
Mr. Eisenstat promised the board that they can submit this information within twenty-four hours, and asked the board to consider this request, subject to them submitting this information within twenty-four hours.
Mr. Higashi said according to the county permits, there is no setback as to boundaries. lVIr. Eisenstat said no. They will go out of their way to insure that any inconvenience caused to the local residents will be kept to the minimum. They have established their own monitoring equipment at their own expense to monitor the level of the well. He said it is their feeling that they have to live in a community and they have to have the local people understand them and be happy with them.
Mr. Higashi moved to approve this request, subject to the applicant submitting additional information on the methodology of pricing, and subject further to review and approval by the chairman and a board member of such material;
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, < 7- o o and forwarding the material with a transmittal from the chairman to the PUC for possible use by PUC for their decision-making process. Mr. Hong seconded, and the motion was unanimously carried.
JUDITH FORSTER REQUEST FOR PERMISSION TO CONSTRUCT AN ADDITIONAL DWELLING ON LOT 21 OF THE LALAMILO FARM LOTS, WAIMEA, SOUTH
ITEM F-10 KOHALA, HAWAII
This was deferred at the last board meeting. Under the provisions of the original conveyance of the Lalamilo Farm Lots, only one dwelling is allowed on the land, provided, however, the board may, at its discretion, authorize additional dwellings. The particular conveyance also states that the land shall be used for agricultural purposes only and cannot be put to some other use unless that use is authorized by the board. Agricultural use is defined and limited to the growing of orchard and truck crops.
Mr. Detor stated that Mrs. Kawasaki, owner of Lot 21, has subdivided the lot and she is in the process of selling 20.103 acres of the 26 acres to Judith Forster, who has asked the board for permission to erect a dwelling on the 20-acre portion of Lot 21. There is already a dwelling on that part of the lot that Mrs. Kawasaki is going to retain. Mrs. Kawasaki is in her 70's and is retired.
In addition to that, Ms. Forster wants to raise protea. Mr. Deter said technically that is not an agriculture use within the framework of the provisions covered in the patent.
Mr. Detor said the board in previous instances have approved additional dwellings for employee housing, but not for subdivision purposes.
Mr. Detor further stated that about a year or more ago the board adopted a policy of denying all requests for construction of additional dwellings on subdivided portions of these lots.
The applicant is asking for one because she is going to operate it as a farm, and she wants to have a place from which to operate. The land has been subdivided.
Mr. Detor pointed out that when the board adopted the policy of refusing to allow dwellings on subdivided portions, it was not in recognition of Ag-5 zoning. The department is trying to avoid a proliferation of 5-acre lots which would turn it into a residential-type subdivision. The idea was to keep the farm character of the subdivision as much as possible.
Ms. Judith Forster, who has been selling real estate for the last three years, briefly addressed the board. She has arranged to purchase the 20-acre portion of the 26-acre parcel. To go into this project, she said she needs to live there and manage i-to She said the land is not being used now and the area has not been fully farmed.
Mr. Higashi said it really is not necessary to live on the lanq, and Ms. Forster agreed. He said the merit of the project should be based on production.
lVIs. Forster said Mrs. Kawasaki lives on the property, so there is some degree to safeguard it. However, Ms. Forster said the land is very big and Mrs.
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:iEORGE R. ARIYOSHI GOVC"NOft 0" HAWAII
STATE OF HAWAII
DEPARTMENT OF LAND AND NATURAL. RESOURCES
DIVISION 01" LAND MANAGEMENT
P. O. BOX Szt
HONOLULU, HAWAII .saoe
February 13, 1981
DIVISIONS: C:ONVKYANC: ••
"'.M AND GAM.
"OIiUTIlY
STAT.I"AIIO
Board of Land and Natural Resources
Honolulu, HI 96813
Gentlemen: HAWAII
Subject: Direct Lease of Geothermal Resources on Reserved Lands to Assignee of Occupier's Rights, Kapoho, Kaniahiku, Keahialaka and Pohoiki, Puna, Hawaii
STATUTE:
APPLICANT:
FOR:
ZONING:
LAND OWNERSHIP:
Chapter 182, Hawaii Revised Statutes, and Regulation No. 8 of the Department of Land and Natural Resources
~~~~~THERMAL CORPORATION, a Hawaii \ corp~on, assignee of the occupier rights ~~ .. T. TRADING COMPANY, LTD., AUTO IMPORTS
OF HAWAII, INC., and PROMISED LAND CORPORATION, pursuant to Section 182-5, Hawaii Revised Statute~.A~ .,,, /' i;7'.~...t"~~/"'.A-~" (At
u;(!;;r. ;t "" C
Direct issuance of a geothermal lease on reserved lands at Kapoho, Kaniahiku, Keahialaka and Pohoiki, Puna, Hawaii, being all of those certain parcels of land (portions of the land described in and covered by: Royal Patent 4497, Land Commission Award No. 8559, Apana 5, to C. Kanainai Royal Patent Grant No. 3209 to Robert
. Rycroft; and Land Patent No. 8094, Land Commission Award No. 8559-B,Apana 15, to Wm. C. Lunalilo) designated by Tax Map Key as follows:
Tax Map Key
1-4-01:20 1-3-08:07 1-3-08:06 1-3-08:19 1-3-09:07 1-3-45:various
Area -45.0738
160.2920 140.0000 227.5910 119.1800
acres acres acres acres acres
1-3-46:see Exhibit A . res ' Total 769.l~ es ~
State Land Use Commission: Agriculture 7tl~'~J {:t, . .,:.;, County of Hawaii: Agricul ture YVlM'fv~ t',,:
J. T. Trading Company, Ltd., Auto Imports of Hawaii, Inc., and Promised Land Cqrporati·on·
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',Board of Land an~tural Resources c;~uary 13, 1981
MINERAL RIGHTS:
MINERAL TO BE MINEO:
TERM:
COMMENCEMENT AND COMPLETION OATES OF DRILLING OPERATION:
PAYMENT FOR THE RIGHT TO EXPLOIT GEOTHERMAL RESOURCES:
ROYALTY:
Expressly reserved to the State of Hawaii in Royal Patent No. 4497 on Land Commission Award No. 8559 and in Royal Patent Grant No. 3209. Land Patent No. 8094 on Land Commission Award No. 8559-B, Apana 15, contains no express reservation but is classified by the State of Hawaii as subject to an implied mineral reservation.
Geo~ermal resources, classified as a min~-~Section 182-1, Hawaii Revised Statutes
The lease shall have a maximum term of sixty-five (65) years; provided that there shall be a primary period of ten (10) years from the effective date orthe lease (and if during this primary period, geothermal resources are being produced or utilized in commercial quantities, the lease term shall continue for so long thereafter as geothermal resources are produced or utilized in commercial quantities, subject, however, to the sixty-five-(65) year limitation).
Continuation or termination of the lease after the primary ten (10) year period shall be in accordance with (Rule No. 3.11 of) Regulation No. 8 of the Department of Land and Natural Resources.
The Lessee shall covenant and agree that Geothermal Resources mining and drilling operations on the reserved lands shall commence within three (3) years from the effective date of the lease, and that at least one geothermal resource well for production shall be completed within four (4) years of the effective date of the lease.
The Lessee shall pay to the State of Hawaii the amount of $770 per annum for the right to exploit Geothermal Resources reserved to the State. Such payment shall be a credit against production royalties due and accrued during anyone-given year, if there be any. The annual rental due in a given year shall not be credited against production royalties due in future years.
a. Ten percent (10%) of the gross amount or value of the geothermal resources produced under the lease as measured at the wellhead and sold or utilized by the lessee for the first 15 years of the lease. No deduction for treating, processing and transportation cost, notwithstanding Rule 3.l3b of Regulation 8.
b. Five percent (5%) 'of .the gross proceeds received by the lessee from the sale of any geothermal by-product contained in and extracted from the effluence produced under the lease as measured at the wellhead and as specified by Rule No. 3.13 of Regulation No. 8 of the Department of Land and Natural Resources.
2
Jo~rd of L~nc ~r.~ c::> N3tural Rc~ourc~s
c;:) February 13, 1981
PAY~T:
REOP~ING OF ROYALTY RATE:
ROYALTIES ON OTHER MINERALS:
l-1..ETERING:
TESTING OF MINERALS:
ASS I Gm!.ENT Ar."lC StJBIZl'TING:
:aOl'ID :
The ~essee shall make payments of royalties to· the Board at its Honolulu office within thirtv (30) days after the end of each month and • accompany such payment with a written statement by the lessee, showing the volume of each gec~~ermal resources and its by-products seld, used, or othe~~ise disoosed of. The Lessee shall furnish suc~ ot~er data as cay be necessary for the Board to audit ar.d verify all royalty paiments.
Royalty rates shall be subject to racp~~ing at the end of the 35th and 50th years of the lease term. Royalty rates for the new period shall be dete::mined by independent appraisal but shall be no less than -the royalty rates at the time of reopening, nor shall it be higher than the max±mum rate 'allowable under Regulation No.8.
In the event the L~ssee desires to mine mL~erals other than Geothermal Resources, the Lessee shall before mining such other ~inerals, so notify the Board in writing, and the ~essee shall negotiate and fix the royalty rates tor such other minerals" as may be allowed to be mined by the Board.
Meterinc equipment shall be maintained and . operated by lessee in' such a manner as to ceet
acceptable standards of accuracy consistent with geothermal L~dust--y practices.
The Lessee shall on a calendar semi-a~nual basis furnish the Board the results of periodic tests showing the content of by-products in ~~e produced geothermal resources. Such tests shall be consistent wi~~ acceptable method of testing practices by the industry.
The Lessee shall not assign and/or sublet the whole or any portion of the rights herein leased, without the ~rior approval of the Board of Lar.d and Natura~ Resources, provided, that any assigr.ment and/or sublease so made shall b'e to
. persons or persons, partnerships, co=?orations, etc., who has obtained from the owner of the lands the right to occupy and conduct geothe:ma: resources minin~ operation ~~ereon.
The Lesse~ shall within thirty (30) days of receipt of the completed lease cocument, file with the Board, and'keep in force for the terill of the lease, a PEUOR.'1A.~CE BOND, in t.~e a..-noun t of S10,000.00, conditioned upon fai~~ul observance and eerfo~nce of all reauiraments of - -the lease. Said Bond shall name the Oepar~~e~t of Land and ~atu:al Resources, State of Hawaii, as obligee.
3
Board of Land ~ Natural Resources
LIABILITY INSURANCE:
RULES AND REGULATIONS:
ENVIRONMENTAL CONCERN:
REMARKS:
RECOMMENDATION:
c;:) February 13, 1981
The Lessee shall secure and maintain in force during the term of the lease, Comprehensive General liability and property damage insurance and products liability insurance naming the State of Hawaii D~~R as additional insured in the following minimum amounts:
a. Comprehensive General Bodily Injury Liability $300,000.00 each occurrence,
. $300,000.00 aggregate.
b. Comprehensive General Property Damage $50,000.00 each occurrence, $100,000.00 aggregate.
c. Products liability in the single minimum limit of $250,000.00.
The lease shall include other applicable provisions required by law and as contained in Regulation No.8.
The Lessee shall comply with all water and air pollution control laws, rules and regulations of the State or its political subdivision. The Lessee shall also comply with all applicable State and County laws relative to Environmental Impact Statements.
Barnwell Geothermal Corporation, assignee of the landowners, has made application as occupier for a geothermal lease on land in Puna which is subject to reservation of mineral rights in favor of the State of Hawaii or is classified by the State of Hawaii as subject to an implied mineral reservation. Application was made in accordance with Section 182-5, Hawaii Revised Statutes (mining leases on reserved lands).
Since the lands are zoned agriculture, it was necessary that special permits be obtained from the County of Hawaii. Six (6) special permits were issued by the County on December 16, 1980.
Under Section 182-5, Hawaii Revised Statutes, the Board may by vote of two-thirds of its members, without public auction, grant a mining lease on reserved land to the occupier thereof.
That the Board approve a direct grant of a geothermal resources mining lease to the assignee covering the lands listed above, subject to the terms and conditions above mentioned, which are by reference incorporated herein, in addition to such other
4
Board of Land a~ Natural Resources
c;:) February 13, 1981
terms and conditions required by law, Department of Land and Natural Resources Regulation No.8, and as may be prescribed by the Chairman. '
Respectfully submitted,
&-"'"t--
JAMES J. DETOR Management Administrator
APPROVED FOR SUBMITTAL:
P:CJh-. S~· ONO, Chairman
5 ________________________________________ "1"'I~'1o' '~
..
BLOCK
1 1 1 1 1 1 1 1 1 1 1 1 .1. 1 1 1 1
2 2 2 2 .2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2
3 3 J 3 3 3 3 3 3 3 3 3 3 3
LOT
2 3 4 5 13 14 15 16 17 18 19 20 21 22 23 24 25
1 3 4 6 7 9 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 65 66 67 68
4 5 8 9 10 11 12 13 14 15 16 17 18 19
EXHIBIT "A" Page 1
~
Q TAX MAP KEY
1-3-46:2 1-3-46:3 1-3-46:4 1-3-46:5 1-3-46:13 1-3-46:14 1-3-46:15 1-3-46:16 1-3-46:17 1-3-46:18 1-3-46:19 1-3-46:20 1-3-46:21 1-3-46:22 1-3-46:23 1-3-46:24 1-3-46:25
1-3-46:76 1-3-46:78 1-3-46:79 1-3-46:81 1-3-46:82 1-3-46:84 1-3-46:52 1-3-46:53 1-3-46:54 1-3-46:55 1-3-46:56 1-3-46:51 1-3-46:58 1-3-46:59 1-3-46:60 1-3-46:61 1-3-46:62 1-3-46:63 1-3-46:64 1-3-46:65 1-3-46:66 1-3-46:67 1-3-46:68 1-3-46:69 1-3-46:70 1-3-46:71 1-3-46:72 1-3-46:73 1-3-46:74
1-3-46:29 1-3-46:30 1-3-46:33 1-3-46:34 1-3-46:35 1-3-46:36 1-3-46:37 1-3-46:38 , 1-3-46:39 1-3-46:40 1-3-46:41 1-3-46:42 1-3-46:43 1-3-46:44
----------------------------------.-.--- --- .....
, ..
BLOCK
3 3 3 3
5 5 5
7 7 7 7 7
8 8 8 8
LOT
2Q 21 22 23
1 2 3
9 10 14 16 17
12 15 16 19
EXHIBIT "A" Page 2
TAX MAP KEY
1-3-46:45 1-3-46:46 1-3-46:47 1-3-46:48
1-3-46:49 1-3-46:50 1-3-46:51
1-3-45:9 1-3-45:10 1-3-45:14 1-3-45:16 1-3-45:17
1-3-45:25 1-3-45:22 1-3-45:21 1-3-45:18
-----------------------------------""-.. ')~
GEORGE R. ARIYOSHI
GOVERNOR OF HAWAII ;. ~ : -• ' C","'
f'j') P 'l.: Z, STATE OF HAWAII .\ 'L(.. '6EPARTMENT OF LAND AND NATURAL RESOURCES
DIVISION OF LAND MANAGEMENT
P. O. BOX 621
HONOLULU. HAWAII 96809
January 2l t 1981
Mr. E. C. Craddick, President Barnwell Geothermal Corporation 2828 Paa Street, Suite 2085 Honolulu, Hawaii 96819
Dear Mr. Craddick:
DIVISIONS: CONVEYANCES FISH AND GAME FORESTRY LAND MANAGEMENT STATE PARKS WATER AND LAND DEVELOPMENT
This i8 to acknowledge the receipt ot your application tor a geothermal mining 1.... on certain reserved lands at Kapoho, Kaniah1ku, Pohoiki and Keahialak.a, Puna, Hawaii and to inform you that we .re scheduling the matter tor the consideration of the Board of Land , Natural Resources at its meeting scheduled for February 13, 1981.
The meeting will be beld in the Board Room of the Dep.rtment of Land & Natural Resources located on the first floor of the Kalanimoku Building, 1151 Punchbowl Street, Honolulu, and will commence at 9:00 A.M. It would be appreciated if you could be represented at the meeting to answer any questions the Board may have.
co: Mr. R. Higashi Mr. G. 'faguchl DOWAI~D c/