JERRY L. CANFIELD, P.A. THOMAS A. DAILY, P.A. WYMAN R. WADE, JR., P.A. DOUGLAS M. CARSON, P.A. ROBERT R. BRIGGS, P.A. † * C. MICHAEL DAILY, P.A. † L. MATTHEW DAVIS † COLBY ROE † Also Licensed in Oklahoma DAILY & WOODS A PROFESSIONAL LIMITED LIABILITY COMPANY ATTORNEYS AT LAW KMW BUILDING 58 SOUTH SIXTH STREET P.O. BOX 1446 FORT SMITH, AR 72902 TELEPHONE (479) 782-0361 FAX (479) 782-6160 JAMES E. WEST PHILLIP E. NORVELL DALE CARLTON OF COUNSEL _______ HARRY P. DAILY (1886-1965) JOHN P. WOODS (1886-1976) JOHN S. DAILY (1912-1987) May 31, 2011 Arkansas Oil and Gas Commission 301 Natural Resources Drive, Suite 102 Little Rock, Arkansas 72205 Re: ORDER REFERENCE NO. 198-2011-07 Application of SEECO, Inc. for an exceptional location pursuant to Arkansas Oil and Gas Commission General Rule B-43(i)(5) for its Salinas 09-15 #2-17H Well located in Section 17, Township 9 North, Range 15 West, Conway County, Arkansas Commissioners: SEECO, Inc., 2350 N. Sam Houston Parkway E, Houston, TX 77032, hereby applies to the Arkansas Oil and Gas Commission as follows: 1. The Applicant, SEECO, Inc. is the operator of the Salinas 09-15 #2-17H Well located in Section 17, Township 9 North, Range 15 West, Conway County, Arkansas (“the Salinas #2 Well”). 2. The Salinas #2 Well was commenced on May 4, 2007 and completed on August 3, 2007, as an in-unit Well in Section 17 with its last perforation approximately 560 feet from the West unit boundary, the boundary between Sections 17 and 18, Township 9 North, Range 15 West. Surveys obtained by the applicant at the time indicated that the well was entirely at a non-exceptional location within Section 17. However, a more recent survey, prepared in order to resolve conflicts between adjoining governmental section corners in the area of the Salinas Well, now indicates that its final perforation occurred 555 feet from the West unit line which is an encroachment upon Section 18 by a total of 5 feet. 3. In view of the minimal nature of the newly discovered encroachment and view of the fact that the Salinas #2 Well has been in production for several years, the applicant requests that it be granted a location exception for the well, rather than requiring the applicant to retroactively apply to treat the Salinas #2 Well as a shared cross-unit well. 4. The parties listed on Exhibit “A” are all of those persons entitled to receive any