6823.0 33800.0 6823.0 34000.0 6823.0 34200.0 Line: T race: 20000 25000 30000 35000 40000 45000 1.500 1.600 1.700 1.800 1.900 2.000 2.100 2.200 2.300 2.400 2.500 2.600 2.700 2.800 2.900 Horizontal Distance (ft):

6600.0 34007.0 6800.0 34007.0 7000.0 34007.0 Line: T race: 15000 20000 25000 30000 35000 40000 1.700 1.800 1.900 2.000 2.100 2.200 2.300 2.400 2.500 2.600 2.700 2.800 2.900 3.000 3.100 Horizontal Distance (ft): Project No. 041 1-1924 Filename: 1 1 1924_fig_GC823-C-1.cdr



### Figure GC 823-C-1. Inline 6823 and Crossline 34007 Showing Conditions Beneath Proposed W ellsite GC 823-C 15034.839 14132.748 13230.658 12328.568 1 1426.478 10524.387 9622.297 8720.207 7818.1 16 6916.026 6013.936 51 1 1.845 4209.755 3307.665 2405.574 1503.484 601.394 -300.697 -1202.787 -2104.877 -3006.968 -3909.058 -481 1.148 -5713.239 -6615.329 -7517.419 -8419.510 -9321.600 -10223.690 -1 1 125.781 -12027.871 -12929.961 -13832.052 -15034.839RELATIVEAMPLITUDETWO-WAYTIMETRAVEL(SEC)TWO-WAYTIMETRAVEL(SEC) GC 823 GC 867 Northwest Southeast

Inline 6823 SAL T

SAL T GC 823 GC 867 Southwest Northeast SEAFLOOR HORIZON 20 HORIZON 35

T OP OF SAL T UNIT 1 UNIT 2
UNIT 3

UNIT 4

SEAFLOOR HORIZON 20 HORIZON 35 HORIZON 40

T OP OF SAL T UNIT 1 UNIT 2

UNIT 3

UNIT 4

Crossline 34007 Proposed W ellsite GC 823-C

Proposed W ellsite GC 823-C

GC 866 GC 824 HORIZON 406800.0 34007.0 Line: T race: 20000 25000 30000 1.500
1.600
1.700
1.800
1.900
2.000
2.100
2.200
2.300
2.400
2.500
2.600 Horizontal Distance (ft): Shallow W ater Flow and Gas Potential HIGH 0 1 2 3 0 = NEGLIGIBLE 1 = LOW 2 = MODERA

TE 3 = HIGH NEGLIGIBLE



### Figure GC 823-C-2. T

ophole Prognosis Chart, Proposed W ellsite C, Green Canyon Block 823 Filename: 1 1 1924_fig_GC823-C-2.cdr Project No. 041 1-1924 3-D Seismic Section Through Proposed W ellsite C X = 2,476,973 FT; Y

= 9,849,490 FT Crossline 34007 at Inline 6823 SW NE

Crossline 34007 GC 867 PROPOSED WELLSITE CTWO-WAYTRAVELTIME (SEC) SEAFLOOR W ater Flow GasUnit 1 HORIZON 20

HORIZON 40 T OP OF SAL TUnit 2Unit 4 1.696

1.753

1.981 2.023 -4,158

-4,307

-4,933 -5,051 149

775 893 149

275 1 18 Seafloor Slopes at 5.1° South.

Lithology/Stratigraphy W A TER FLOW AND GAS POTENTIAL Horizon Horizon TWT (sec, bsl) Depth

(ft, bsl) Depth (ft, bml)Units Unit

(Interval) Thickness (ft)Unit 3 Potential Drilling Constraints

F AUL T 1.945 -4,831 HORIZON 35 1.883 -4,658 500 351 V ery soft, pelagic drape at seafloor . Hemipelagic silty clays and thin mass-transport deposits. Alternating layers of hemipelagic silty clays with chaotic mass-transport deposits. Mud-rich turbidites. Fault near base of unit. Chaotic sequence created by salt movement. Mixture of silts and clays. Negligible potential for overpressured sands. Negligible potential for shallow gas. Negligible potential for overpressured sands. Negligible potential for shallow gas. Low potential for overpressured sands. Low potential for shallow gas. Fault possible zone of loss circulation. Low potential for overpressured sands. Low potential for shallow gas.

T op of salt slopes 7.2 ° to East. SAL T 673

TROUGH PEAK RELA TIVE AMPLITUDE10615 SHADOW WOOD DRIVE SUITE 200 HOUSTON, TEXAS 77043 Phone: (713) 468 - 1410

Fax: (713) 468 - 1438 E - mail: gems@gemsinc.com

- 1 - Proposed Well GC 867 - A May 20 , 2011 Project No. 0411 - 1924 Apache Deepwater, LLC 2000 W. Sam Houston Pkwy. South, Suite 1600 Houston , Texas 77042 - 3622 Attention: Mr. John A. Worthen 

### Site Clearance Letter Proposed Wellsite GC 8 67 - A

Block 8 67 (OCS - G - 33858 ) Green Canyon Area Gulf of Mexico Apache Deepwater, LLC ( Apache ) plans to drill an exploration well in Block 867 , of the Green Canyon Area ( GC ), Gulf of Mexico. This letter addresses specific seafloor and subsurface geologic conditions to a depth of approximately 1,121 ft below the mudline ( bml ) at the Proposed Exploration Wellsite GC 867 - A . The following discussion is based on findings provided within the main body of the geohazard report for Blocks 823 and 867 ( GEMS Report No. 0411 - 1924) . The surface location for Proposed Wellsite GC 867 - A is in the northwestern quadrant of GC 867 . Apache provided the following coordinates: Proposed Wellsite GC 8 67 - A Spheroid & Datum: Clarke 1866, NAD27 Projection: UTM Zone 15 North Line Reference Blo ck Calls X: 2,47 6 , 92 8 ft Latitude: 27.1 278025504676 o N Inline 6 805 27 ft F N L Y: 9,85 2 , 453 ft Longitude: 90. 4277812536595 ° W Crossline 34 073 5 , 88 8 ft FWL Apache will drill this well using a moored vessel. An exact anchor pattern for the proposed well location is undetermined at this time. Maps GC 867 - A - 1 through GC 867 - A - 4 show an anchor radius representing a typical maximum length of chain and anchor on bottom is d isplayed at 10,000 ft from the proposed wellsite. A 1,000 ft buffer zone beyond the limits of the anchor radius is also included, NTL 2009 - G40 (MMS, 2009a). 

### Attachments The maps and figures accompanying this letter have been extracted from the main repor t’s original maps and 3 - D data volume and centered on the proposed well location. Map GC 867 - A - 1: Bathymetry Map Map GC 867 - A - 2: Seafloor Rendering Map GC 867 - A - 3: Seafloor Amplitude Rendering Map GC 867 - A - 4: Geologic Features Map Figure GC 867 - A - 1: Inline 6805 and Crossline 34073 Showing Condit ions Beneath Proposed Wellsite GC 867 - A Figure GC 867 - A - 2: Tophole Prognosis Chart, Proposed Wellsite GC 867 - A , G reen Canyon Block 867Project No. 04 11 - 1924

- 2 - Proposed Well GC 867 - A 

### NTL Requirements The following report complies with the Bureau of Ocean Energy Management, Regulation, and Enforcement (BOEMRE; formerly the MMS) Notice to Lessees (NTLs) 2008 - G04, 2008 - G05 and 2009 - G40 (MMS, 200 8a, 2008b, and 200 9 a ). The proposed wellsite will be required to follow NTL 2008 - G06 with respect to pre - and post - spud ROV visual inspection surveys (MMS, 2008 c ). Pursuant to the recently released Pre - Seabed Disturbance Survey Mitigation issued by BOEMRE, the 2005 - G07 NTL (MMS, 2005) does not apply to GC 867 in terms of high - probability (MMS, 2008d) , but an archaeological assessment of the data must be performed prior to any bottom disturbing activities (BOEMRE, 2011b) . According to NTL 2008 - G05 (MMS, 2008b), 3 - D seismic reflection data may be used for shallow hazard assessments. A power spectrum analysis was conducted from the 3 - D seismic data cube provided by Apache to illustrate the data parameters. The power spectrum curve (below) was generated within a 500 - ft radius of the intersection of the inline and crossline at the proposed wellsite location, ove r a time interval from the seafloor to ~0.405 second below mudline, i.e., the salt/sediment interface. We converted the amplitude vs. frequency spectrum, generated by the SMT software, to power vs. frequency by squaring the amplitude values as described b y J. A. Coffeen, 1978.

Power Spectrum Analysis Curve, Proposed Wellsite G C 867 - A 

### Man - Made Features There are existing wells in G C 867 and in surrounding blocks. The closest well to Proposed Wellsite GC 867 - A is the BP Exploration Inc. , GC 823 - 00 1 well approximately 2,270 ft to the northeast (Maps GC 867 - A - 1 through GC 867 - A - 4). 0 0.2 0.4 0.6 0.8

1 1.2

0 10 20 30 40 50 60 70 80 90 100Power (amp2)

Frequency (hrz) POWER SPECTRUM

GC 867 - AProject No. 04 11 - 1924

- 3 - Proposed Well GC 867 - A Other wells near the Proposed Wellsite GC 867 - A are the BP Exploration Inc. , GC 823 - 0022 well and GC 869 - 001 wells. These wells are approximately 9,350 ft east - northeas t and 9,420 ft west - southwest, respectively, of the proposed site and lie within the proposed mooring pattern. Proposed Wellsite GC 867 - A and its anchors lie within the “Military Warning Zone W - 92”. Military warning zones typically do not have any impact on exploration drilling operations or other oilfield activities. However, notifications to appropriate military commands need to be addressed by Apache (MMS, 2009b). Restrictions would only be enforced during military operations in the area or during an emergency. 

### Water Depth and Seafloor Conditions T he water depth at the proposed location is - 4,106 ft (Map GC 867 - A - 1). The seafloor at the proposed location is slightly irregular and dips to the south ea st at about 1.1  ̊. The proposed wellsite is located within a northwest - southeast trending valley. The walls of the valley are formed by seafloor faults. The closest fault is approximately 500 ft to the south (Map GC 867 - A - 2). Water depths within the potential anchor mooring area range from about - 3,660 ft along a ridge line to the north to approximately - 4,700 ft on the upper part of the Sigsbee Escarpment to the south (Map GC 867 - A 1). The seafloor within the potential anchori ng area varies from smooth and featureless to very irregular. The seafloor irregularities include narrow ridges and gullies, faults, and mounds. Seafloor gradient within the mooring pattern will average from 1° to 5°. The highest seafloor gradients in t he area are associated with fault escarpments. Gradients of over 20  ̊ are associated with fault scarps that occur primarily north and southwest of the proposed location . The upper part of the Sigsbee Escarpment to the south will be marked by an increase i n slope from less than 10° to approximately 20°. Near - surface soils along the Sigsbee Escarpment are likely to be highly overconsolidated and much stronger than typical slope soils. 

### Deepwater Benthic Communities The Seafloor Amplitude Rendering based on the 3 - D data volume (Map GC 867 - A - 3) shows normal or ambient amplitude along the seabed, with no indication of any hard - bottom or fluid expulsion events within 2,000 ft of the proposed GC 867 - A location. Based on the renderings and seismic profiles d eepwat er benthic communities are not expected within 2,000 ft of the proposed GC 867 - A wellsite. Patches of high - amplitude seafloor returns occur approximately 7,700 ft to the southwest of the location. The patches are associated with seafloor faults. In addition, the base of a m ud mound exists approximately 9, 80 0 ft to the northwest (Maps GC 867 - A - 1 through GC 867 - A - 4). These features have a high - potential for deepwater benthic communities. Therefore, anchors must avoid these features by at least 250 ft (MMS, 2009a). A number of seafloor faults occur within the proposed mooring pattern. The closest seafloor faults occur approximately 500 ft to the south. Except for the faults 7,700 ft to the southwest, no high - amplitude returns occur along the seabed es carpments; therefore, prolific hydrocarbon seepage or carbonate hardgrounds are unlikely. 

### Stratigraphy Inline 6805 and Crossline 34073 are the closest 3 - D lines to the proposed GC 867 - A location (Figure GC 867 - A - 1 ). The Tophole Prognosis Chart (Figure GC 867 - A - 2 ) shows the crossline annotated with calculated depths to the various horizons and predicted lithology of the sequences, along with their potential for shallow water flow and shallow gas. The 3 - D data volume was used to define the sedimentary s ection to a depth of approximately 1,121 ft (Figures GC 867 - A - 1 and GC 867 - A - 2). The section was divided into four units or sequencesProject No. 04 11 - 1924

- 4 - Proposed Well GC 867 - A (Figure GC 867 - A - 1 ). The sequences represent variations in depositional environments and possible changes in soil strength and composition. The surficial unit, Unit 1 (Seafloor to Horizon 20 ), to approximately 186 ft bml, consists of a very soft pelagic drape underlain wi th hemipelagic silty clays and thin, mass - transport deposits . Very soft clays with high water content will exist at the seabed. The soils will increase in strength and decrease in water content with depth. Unit 2 (Horizon 20 to Horizon 35) consists of be dded hemipelagic clays interbedde d with thin chaotic mass - transport deposits. The sediments will be mud - rich; however, some thin sand seams and pockets are possible near the base of the unit as suggested by the slight increase in reflection amplitude. Th e combined thickness of Units 1 and 2 is approximately 294 ft (Figure GC 867 - A - 2 ). Unit 3 (Horizon 35 to Horizon 40) consists of mud - rich turbidites. The top of Unit 3 , Horizon 35, is at about 294 ft bml. The unit is approximately 561 ft thick beneath GC 867 - A. Unit 4 is a sequence bounded by Horizon 40 and the top of salt ( Figures GC 867 - A - 1 and GC 867 - A - 2). The sequence consists of bedded turbidites that have been affected by shallow salt emplacement . Unit 4 occurs between 855 ft and 1,121 ft bml at t he proposed location. Unit 4 will likely consist of a mixture of silts and clays and is approximately 266 ft thick. The top of salt is predicted to be 1,121 ft bml (~5,227 ft bsl). The salt surface dips to the east - northeast at approximately 21°. 

### Faults Three faults will be intersected by the well bore beneath proposed Wellsite GC 867 - A (Figure s GC 867 - A 1 and GC 867 - A - 2 ). The borehole will intersect the faults at approximately 303 ft, 499 ft, and 739 ft bml. All faults will be penetrated between Horizon 35 and Horizon 40 (Unit 3). 

### Shallow Water Flow Unit 2 between Horizons 20 and 35 is possibly the regional “Red Unit” s lope - fan sequence. However, the top of the unit is only 186 ft bml at proposed Wellsite A (Figure GC 867 - A - 2). The entire unit is 108 ft thick. At this location, Unit 2 is an unlikely zone for overpressured sand layers. The existing GC 823 - 001 well is approximately 2 , 270 ft to the northeast of the proposed GC 823 - A wellsite. A “low” severity shallow water flow occurred in the GC 823 - 001 well at 1,715 ft bml ( - 5,840 ft bsl). Based on the reported depth the flow occurred in the lower portion of Unit 4 within a generally low amplitude interval of discontinuous to chaotic reflections (Figure GC 867 - A - 2). In addition, the interval is bounded by faults that extend from salt to the seafloor. The shallow water flow may have originated from an isolated sand pocket or layer within the chaotic interval. An alternative explanation is the flow originated in the shallower interval at the top of the unit consisting of bedded, moderate - amplitude turbidites. The flow may not have been observed until drilling was at the 1,715 ft level. Because of the proposed well is within the same valley as the GC 823 - 001 well, the lower portion of Unit 4 has been given a high potential for sha llow water flow (Figure GC 867 - A - 2). Sands within the unit are likely to be isolated an d faulted. Like GC 823 - 001 any flow will be short - lived and of low severity. 

### Shallow Gas The well path will not penetrate any high - amplitude events between the seafloor and the top of salt (Figure GC 867 - A - 2). There is a negligible to low potential fo r shallow gas in this section. 

### Closing T he seafloor and near - surface conditions at Proposed Wellsite GC 867 - A , Green Canyon Block 867 (OCS G - 33 858), appear suitable for exploration drilling operations. The existing wellsites and the areas withProject No. 04 11 - 1924

- 5 - Proposed Well GC 867 - A potential b enthic communities will need to be avoided by anchors supporting a drilling vessel at the proposed location. Three faults will be encountered at depth. Sincerely, GEOSCIENCE EARTH & MARINE SERVICES, INC. ®

Thomas W. Neurauter Ph. D. Daniel Lanier Senior Marine Geologist Vice - President/Marine Geologist Attachments ( 4 Maps, 2 Figures) Distribution: Mr . John Worthen , Apache Deepwater, LLC, Houston, TX. ( 6 ) References: Bureau of Ocean Energy Management and Enforcement, 2011a , ASCII Data Files, published on the BOEMRE Gulf of Mexico Region Homepage, <http://www.gomr.mms.gov/homepg/pubinfo/freeasci/freedesc.html>, accessed May , 20 11 . Bureau of Ocean Energy Management, Regulation, and Enforcement , 20 11b, Pre - Seabed Disturbance S urvey Mitigation < http://www.gomr.boemre.gov/homepg/regulate/environ/archaeological/Conditional - Archaeological Mitigation.pdf >. Coffeen, J. A., 1978, Seismic exploration fundamentals: Tulsa, the Petroleum Publishing Co., p. 125. Minerals Management Service, 2005, Notice to lessees and operators of federal oil, gas, and sulphur leases and pipeline right - of - way holders in the outer continental shelf, Gulf of Mexico OCS region, Archaeological resource surveys and reports: U. S. Depa rtment of the Interior, Minerals Management Service, Gulf of Mexico, NTL 2005 - G07. Minerals Management Service, 2008a, Notice to lessees and operators of federal oil, gas, and sulphur leases in the outer continental shelf, Gulf of Mexico OCS region, inform ation requirements for exploration plans and development operations coordination documents: U. S. Department of the Interior, Minerals Management Service, Gulf of Mexico, NTL 2008 - G04. Effective Date May 1, 2008. Minerals Management Service, 2008 b , Notice to lessees and operators of federal oil, gas, and sulphur leases and pipeline right - of - way holders in the outer continental shelf, Gulf of Mexico OCS region, Shallow hazards requirements: U. S. Department of the Interior, Minerals Management Service, Gulf of Mexico, NTL 2008 - G05. Minerals Management Service, 2008 c , Notice to lessees and operators of federal oil, gas, and sulphur leases in the outer continental shelf, Gulf of Mexico OCS region; remotely operated vehicle surveys in deepwater, U. S. Departmen t of the Interior, Minerals Management Service, Gulf of Mexico, NTL 2008 - G06. Minerals Management Service, 2008 d , Notice to lessees and operators (NTL) of federal oil and gas leases and pipeline right - of - way (ROW) holders on the outer continental shelf (OCS), Gulf of Mexico OCS region (GOMR), Revisions to the list of OCS lease blocks requiring archaeological resourc e surveys and reports: U. S. Department of the Interior, Minerals Management Service, Gulf of Mexico, NTL 2008 - G20.Project No. 04 11 - 1924

- 6 - Proposed Well GC 867 - A Minerals Management Service, 20 09a , Notice to lessees and operators of federal oil and gas leases in the outer continental shelf, Gulf of M exico OCS region, Deepwater benthic communities: U. S. Department of the Interior, Minerals Management Service, Gulf of Mexico, NTL 200 9 - G 4 0. Minerals Management Service, 2009b, Notice to lessees and operators of federal oil and gas leases and pipeline rig ht of

- way holders on the outer continental shelf, Gulf of Mexico OCS region, Military Warning and Water Test Areas: U. S. Department of the Interior, Minerals Management Service, Gulf of Mexico, NTL 2009 - G06. Effective Date April 22, 2009.