Chesapeake Energy Corporation Request for Information Response May 19, 2011 1. Legal name and address of Respondent.

q Chesapeake Energy Corporation 6100 N. Western Ave. Oklahoma City, OK 73118 2. Business of the Respondent. Include the primary Standard Industrial Classifications (SIC) and North American Industrial Classifications System (NAICS) codes. SIC Code: 1311 NAICS Code: 211111 3. Year the Respondent first owned and/or operated the Facility. Chesapeake Energy Corporation defines the facility to be the Atgas 2H well with the boundaries being the area of disturbance noted in the ESCGP-1 document contained in Appendix A. The Company began site preparation and building operations in May 2010 and began drilling the Atgas 2H well on December 27, 2010. 4. Date and state of incorporation of Respondent. Chesapeake Energy Corporation filed articles of incorporation in the state of Oklahoma on November 19, 1996. 5. Provide a description of the drilling operations conducted at the Facility, when those activities began, and if and when drilling operations were completed at the Facility. Drilling operations commenced on December 27, 2010 and continued until February 15, 2011, at which time drilling operations were completed. Surface casing of 13 3/8 was set and cemented on December 28, 2010. Intermediate casing of 9 5/8 was set and cemented on January 4, 2011. Production casing of 5 was set and cemented on February 15, 2011. 6. State at what point in the well drilling or well completion process the release occurred and provide a description of the events leading up to, through and following the release. Immediately prior to the release, Chesapeake Energy Corporation was conducting hydraulic fracturing activities through its service provider Pumpco Services. Hydraulic fracturing operations began at the Atgas 2H well on April 18, 2011. The operations proceeded in three stages, with the third stage beginning shortly after 9:00 p.m. on April 19, 2011. The wellhead began to leak at approximately 11:15 p.m. on April 19, 2011, during the third stage of hydraulic fracturing operations. Chesapeake responded promptly and prudently to the circumstances presented by the incident in order to regain control of the well and ensure public safety, and to protect the environment. NOTE: The time of the onset of the event 1
CHK00006287

Chesapeake Energy Corporation Request for Information Response May 19, 2011 was inadvertently misstated in our April 29, 2011 submission, in response to Question 2. Description of actions to regain control of the well and ensure public safety Immediately upon onset of the leak, location personnel began work to assess and stabilize the situation and ensure safety. Notification also was provided to Chesapeake management and appropriate personnel were dispatched to the location, including construction personnel to assist as needed with fluid control, drilling personnel to assist with well control efforts, and security personnel. Well control specialists also were mobilized to the location. The first contracted well control team member arrived on site at approximately 12:30 AM. The first responder was certified as a Well Control Supervisor by the International Association of Drilling Contractors (IADC). Chesapeakes local manager, also certified by IADC as a Well Control Supervisor, arrived on site at approximately 1:03 AM. A third certified Well Control Supervisor, arrived by approximately 1:15 AM. These three certified professionals constituted our well control team and led the formulation and implementation of Chesapeakes initial response efforts. At 8:00 AM, the three specialists were joined by an additional well control team member. In an effort to stop the wellhead release, the well control team assessed the incident and formulated a well control plan. As part of this plan, a formulation of heavy fluid and plugging materials was designed to stem the flow from the well. Materials required for pumping the lost circulation material were being mobilized in the early hours of the incident (heavy kill fluid, plugging debris). During this time, the team was designing the fluid, assembling necessary materials, mobilizing and preparing equipment, and assessing the best approach to the well to accomplish the injection. The first of the plugging attempts, implemented at approximately 6:47 AM, reduced flow only a small amount; the second attempt, implemented at approximately 10:00 AM, reduced flow by approximately 50 percent; the third and fourth attempts, at approximately 12:27 PM and 1:00 PM, respectively, also reduced flow. These early actions by the well control team were successful at reducing the release from the well by approximately 70 percent. Prior to the fourth attempt, additional contract well control personnel (Boots and Coots) arrived on site. This team continued to carry forward the well control plan being implemented by the first responding control team by making additional plugging attempts. 2
CHK00006288

Chesapeake Energy Corporation Request for Information Response May 19, 2011 At approximately 7:00 PM on April 20, after consultation with the well control team, and to mitigate further risk to personnel and equipment, plans were finalized to mobilize the completions crew and all non-essential equipment off location. Equipment was removed, the primary containment was repaired, the location was cleared, and all ignition sources were removed from location. This work continued until 11:15 PM, when the Lower Explosive Limit (LEL) monitors registered low methane levels at the wellhead. At this time the location was cleared of personnel and equipment and secured until daylight. As a part of Emergency Response Preparedness, a general Bradford County Marcellus Plume analysis was created in 2009 for use in early incident safety risk assessments. Due to the fact that the well release was expected to turn primarily to gas on the evening of April 20, Chesapeake requested Boots and Coots to undertake a site-specific plume analysis for the location in order to assess safety precautions. This analysis accounted for actual well conditions, weather and topographic features of the location. The analysis showed no danger to adjoining residents existed. At approximately 5:45 AM on April 21, the flow from the well turned primarily to gas. A single pumping unit and associated auxiliary equipment were rigged up on April 21 to conduct a fifth plugging attempt. This was conducted at approximately 3:50 PM, and was successful in stemming the well flow. Following evaluation of the need for further action, a coil tubing intervention was conducted the morning of April 25, bringing the well under permanent control. Description of actions taken to protect the environment Chesapeakes design for pad construction and our spill containment measures are designed to control on-site fluids, including rainwater. In summary, the site design utilized by Chesapeake included: Primary containment surrounding all fill sides of the pad Upslope diversion ditches Sedimentation/runoff capture ponds Siltsox High density plastic based bermed secondary containments Two vacuum trucks on location during completion operations

The design employed at the well pad substantially reduced the fluid discharge from the well pad during the incident. The vacuum trucks began collecting fluid promptly after the incident began shortly after 11:00 3
CHK00006289

Chesapeake Energy Corporation Request for Information Response May 19, 2011 PM on April 19, 2011. The discharge from the primary containment occurred, hours into the incident, because the primary containment had subsided on the north side of the pad due to heavy rain and saturated conditions. The discharge from the primary containment, however, was limited to the time approximately between 2:30 AM and 6:30 AM on April 20, 2011. Operation of vacuum trucks was successful in stemming the fluid flow from the pad surface. Support personnel were contacted in order to ensure appropriate equipment was available at the site to alleviate the potential for fluid discharge. Heavy equipment, stone, soil, and additional vacuum trucks were ordered to respond. As many as eight vacuum trucks were on site throughout the remainder of the event, and six were onsite operating by approximately 6:30 AM. Once onsite at approximately 2:30 AM (2 hours 45 minutes after the initial call), Chesapeakes support personnel, in coordination with the well control team, considered options to address the discharge at the point of discharge. Concerns for worker safety, however, precluded the movement of construction equipment to the pad to bolster the primary containment. In addition, saturated ground conditions precluded access to the base of the containment throughout the night. By approximately 6:30 AM, the vacuum trucks were able to sufficiently drain the fluid on the pad and stop the flow over the primary containment. Soon after, at first daylight, Chesapeake was able to identify a potential means of access over neighboring property to prevent further discharge to any water of the Commonwealth. The support personnel secured access from the landowner, laid stone to allow access, and moved equipment into place to pump the sedimentation/capture ponds. Recovery of fluid by pumping below the pad began at approximately 10:30 AM. Additionally, Chesapeake installed a diversion ditch along the lease road to direct seepage from the pad into the existing sediment ponds. After well control operations temporarily ceased onsite overnight on April 20, support personnel directed the fortification of the primary containment in case of heavy rain or the need to use water for suppression. Throughout the remainder of the incident and under the guidance of the Incident Commander, support personnel and Chesapeake Regulatory personnel surveyed the site and added matting, stone, and Siltsox to prevent any further discharge of fluids. The Environmental Response Chronology (document CHK00000031CHK00000034), provided to the Agency on April 29, 2011, provides further detail regarding the efforts taken to assess and protect the environment. Additionally, early into the incident, Chesapeake provided notification to residents proximate to the site, to ensure public safety. 4
CHK00006290

Chesapeake Energy Corporation Request for Information Response May 19, 2011

Following the incident, Chesapeake developed a sampling and analysis plan (SAP) to further assess if or to what extent the incident impacted area soils, surface water or domestic water wells. A copy of the SAP was provided to the Agency by letter dated May 3, 2011 (document CHK00000047-CHK00000767). The SAP has been approved by the Pennsylvania Department of Environmental Protection and is being implemented.

9. Identify all substances released from Facility in connection with the Release. Specifically, identify: a. name and CAS Number for each substance discharged b. For oils or hydrocarbon compounds, identify the type and grade c. Provide the quantity and concentration of each substance (including hazardous substances, oils, total dissolved solids and constituents thereof, and radioactivity) discharged and the method by which the concentration was measured or estimated. For mixtures, provide the name, quantity, and concentration of each constituent of that mixture. d. Provide the solubility and specific gravity of each substance discharged. e. Provide the total quantity of undiluted substances released from the Facility in gallons for oils and in pounds for hazardous substances. Chesapeake Energy Corporation submitted all information known to the Company regarding the substances released from the Atgas 2H well on April 26, 2011 (documents CHK00000001-CHK00000029). 12. For the Release, include a clear timeline of the events immediately prior to, during, and following the Release. Include all information that was relied upon to determine the time and duration of release. Please see our response to Item 6 above. 16. List the starting time, date, and duration of the discharge and the time and date when the discharge entered a waterway. Please see our response to Item 6 above. Due to weather and other conditions at the time of the incident, we are not able to determine the precise time that the discharge entered a waterway. The discharge mixed with rainwater on the well pad, in the sediment/capture ponds and on the adjoining ground, and is believed to have been carried with stormwater to the nearby unnamed tributary of Towanda Creek. 22. Provide the name and address of the operators of the Facility described above in Question 25 and describe the relationship between the owners and operators (i.e., employee, subcontractor, lessee, etc). Identify any persons who concurrently with you exercised actual control or who held significant authority to control activities at the Facility at any time. Include: 5
CHK00006291

Chesapeake Energy Corporation Request for Information Response May 19, 2011 a. Partners and/or joint ventures b. Every contractor, subcontractor, or licensor with any presence or activity at the Facility (e.g., service contractors, remediation contractors, management and operator contractors, licensor providing technical support for licensed activities) c. All persons who exercised actual control over any activities or operations at the Facility d. All persons who held significant authority to control any activities or operations at the Facility e. All persons who had a significant presence or who conducted significant activities at the Facility f. All government entities that had proprietary (as opposed to regulatory) interest or involvement with regard to the activity at the Facility At this time, Chesapeake Energy Corporation is still gathering information responsive to this inquiry. The Company intends to update its response on or before June 27, 2011. 27. For the wells located at the Facility, provide: a. The name or identifier of each well b. Well construction information (specifications on casing depths, cement tops/bottoms, and perforated zones) c. Well Maintenance information (logs and inspection records) d. Well incident information (including fluid loss during drilling or storage, cement loss, problems during hydraulic fracking or other operations). Provide any root cause analysis conducted and corrective actions taken in response. e. Well lithologic logs (mud logs) With respect to Items a-c and e, please see the attached Appendix B. Note, this information is submitted as confidential business information. With respect to Item d, please see our response to Item 6 above. Additionally, Chesapeake previously has provided a summary table identifying the products used in hydraulic fracturing operations at the site (document CHK00000001). By letter dated April 29, 2011, Chesapeake also provided its estimate of amount of fluid released from the site (response to Question 4, April 29, 2011). With regard to the cause of the failure at the wellhead and corrective actions we have taken, please see the discussion below. Explanation of the cause of the failure Wellheads and associated components requested for Chesapeake operations are required to meet contractor or vendor requirements, Chesapeake requirements, and API Specification 6A governing Wellhead 6
CHK00006292

Chesapeake Energy Corporation Request for Information Response May 19, 2011 and Christmas Tree Equipment. Wellhead vendors supplying Chesapeake with this type of equipment are required to source, assemble, test, and maintain supplied wellheads in strict accordance with the governing specifications. Chesapeakes policies require single source custody for wellheads utilized in our operations. In other words, all wellheads are sourced, assembled, tested, supplied and maintained by a single responsible entity. Chesapeake believes that the single chain of custody practice is preferable to other alternatives, given the clear lines of responsibility it creates. Chesapeake has investigated the cause of the failure at the wellhead and determined that the point of failure was the Tubing Head to Lower Master valve flange connection, and expects the cause to be component failure or lack of adherence to procedural guidelines. The two components above, and the flange connection between same, were manufactured, assembled and tested by the vendor supplying the entire wellhead assembly in its facility. The same supplying vendor also was responsible for maintenance of the wellhead during the entire operation and prior to each completion stage. Failures of the type experienced on the Atgas 2H are extremely rare. Chesapeake has used wellhead equipment from the same vendor and of the same design as was used at Atgas 2H in operations at more than 150 Marcellus wells without incident. Equipment from the same vendor of the same design, but of slightly larger size, also has been used at an additional 18 Marcellus wells without incident. In total, accounting for both sizes of this component, this vendors equipment has been used at more than 350 Chesapeake wells nationwide (including Marcellus wells) without a comparable problem. As a result of the incident, Chesapeake undertook a comprehensive inspection of all wellhead equipment intended for use in completion operations in Pennsylvania, West Virginia and Ohio, to ensure the safety of ongoing operations. Chesapeake also undertook a comprehensive review of, and implemented appropriate changes to, its procedures to ensure that all vendors adhere to the requisite standards for material integrity and equipment preparation, assembly, inspection, testing, installation and maintenance, as well as its procedures for overseeing vendor activities in connection with these activities. Inspection of wellhead equipment In order to assess completion equipment and procedures at its Marcellus well sites, Chesapeake suspended completion activities on April 20, 2011 and initiated a program of thorough wellhead inspections on wells in the completion phase. As described further below, Chesapeake also 7
CHK00006293

Chesapeake Energy Corporation Request for Information Response May 19, 2011 undertook a detailed review of installation and maintenance procedures for completions equipment. The equipment inspections were carried out for all wells in Pennsylvania, West Virginia and Ohio with ongoing or planned completion activities. In particular, we isolated each well, broke down every individual component within the wellhead, inspected each component and documented its condition with pictures, repaired any defects, reassembled the wellhead, and reinstalled the wellhead in accordance with API standards and vendor SOPs. The inspections were performed by the wellhead companies with direct Chesapeake oversight. Although the findings of the audit did not reveal wellheads with compromised integrity, areas of concern were corrected and addressed with the wellhead vendors for future operations.On the basis of this comprehensive review, Chesapeake is confident that all of this equipment intended for use in completion activities at Chesapeake well sites is fully functional, structurally sound, in good working order and compliant with requisite standards. Changes to well completion and control procedures In addition to the comprehensive mechanical integrity review, Chesapeake undertook a thorough review of the installation and maintenance procedures for completions equipment. Based on this review, it was determined that very thorough processes are in place regarding wellhead assembly, installation and maintenance in accordance with API specifications, vendor requirements and Chesapeake requirements, but that vendor process compliance assurances and quality assurance/oversight could be further enhanced. The fabrication/assembly/installation/maintenance/testing processes that are employed are being enhanced with the actions noted below: As detailed above, all wellheads in the completion phase have been thoroughly reinspected and tested and are in good working order and in compliance with requisite standards. In order to ensure compliance in the future, Chesapeake is coordinating third-party inspections/audits of all wellhead vendors utilized in PA, WV and OH. All phases of our wellhead vendor operations are being assessed for compliance with API/Vendor/CHK processes in the manufacturing, shop assembly, field installation, and field maintenance phases. Frequency and procedural requirements of this QA/QC action will be adjusted over time based on vendor compliance and progress. Enhanced oversight measures employed: 8
CHK00006294

Chesapeake Energy Corporation Request for Information Response May 19, 2011 o Photo documentation of parts and assembly to be provided by wellhead vendor o Signed shop assembly process/test checklists/charts to be provided by wellhead vendor. o Signed field assembly process/test checklists/charts to be provided by wellhead vendor o Signed field maintenance checklists to be provided by wellhead vendor Chesapeake representative to witness field maintenance and installation procedures and verify that the prescribed operations have been completed. Wellhead vendor to maintain proper equipment certification of make up tools on-site for review by Chesapeake Representative.

Chesapeake also convened meetings the week of April 25 with all of the wellhead vendor companies currently supplying equipment and services to its Pennsylvania operations. General inspection observations were shared with the vendors as well as the QA/QC enhancements noted above. The discussions emphasized the need to establish procedures to assure that vendors would adhere to applicable written policies. Inspection of Erosion and Sediment Controls Chesapeake believes that its design and specifications for pad construction and spill containment lead the industry. The site design and specifications utilized by Chesapeake include: Primary containment surrounding all fill sides of the pad Upslope diversion ditches Sedimentation/runoff capture ponds Siltsox High density plastic based bermed secondary containments Two vacuum trucks on location during completion operations

Under the current design, primary containment surrounding the fill sides of a pad is specified at a height of 30 inches. Chesapeake is committed to use a design of equal or greater protectiveness in the design of all future Marcellus sites. Following the incident, Chesapeake re-inspected containment installations at its Marcellus well sites for compliance with design standards and company policies. Any deficiencies noted have been corrected. Prior to 9
CHK00006295

Chesapeake Energy Corporation Request for Information Response May 19, 2011 beginning any completion job, Chesapeake again will inspect the containment measures at the site and correct any deficiency. No completion job will begin with containment out of compliance. During the course of these efforts, Chesapeake has had upwards of 50 third-party crews working to inspect and repair, as needed, over 400 active well sites. This is in addition to Chesapeakes regular construction crews and inspections. A separate third-party contractor also has 5 inspectors performing approximately 45 inspections per week.

30. Provide a clear and complete copy of CHK's natural gas lease for the Facility and state whether or note this lease covers all of the wells at the Facility . Please see the attached Appendix C for a copy of the oil, gas, and mineral leases associated with the Atgas 2H well. 31. Provide a clear and complete copy of each and every permit obtained by CHK for drilling and operation of the Facility and state whether such permits cover each well at the Facility. For the purposes of responding to this inquiry, please see the attached Appendix A for a copy of permits associated with drilling and operation of the Atgas 2H well. 48. Provide distances, in feet, from the location of the release to the northern, southern, eastern, and western boundaries of the Facility. The location of the release was from the wellhead itself and the distance to the directional boundaries of the facility are noted on the plat map included in the ESCGP-1 portion of Appendix A. 54. Identify the agencies notified of the release, including the date, time, method of contact, agency name, and the title of the person making the report. Information responsive to this question was provided in ourletter submitted to Joan Armstrong, Chief of Oil and Prevention Branch (3HS62), via email and FedEx on April 29, 2011. 55. Identify the hourly meteorological conditions at the time of the release and the source of that information, including: a. Wind speed b. Wind direction c. Amount of cloud cover d. Ambient air temperature e. Humidity Below, please find the requested meteorological conditions at the time of the release as measured at 3 independent observation points near the 10
CHK00006296

Chesapeake Energy Corporation Request for Information Response May 19, 2011 facility, one of which (Williamsport) is a Federal Aviation Administration station. All of these stations are non-Chesapeake Energy Corporation weather stations. New Albany, PA (station ID: AT324) @ 11:47 AM EDT, April 19th Wind speed: calm Wind direction: calm Cloud cover: not available Air temp: 38F Humidity: 95% Wysox, PA (station ID: D3366) @ 11:43 AM EDT, April 19th Wind speed: 1 mph, gusting to 2 mph Wind direction: 22 degrees (north-northeast) Cloud cover: not available Air temp: 38F Humidity: 94% Williamsport, PA (station ID: KIPT) is the nearest station reporting weather conditions/cloud cover, but is farther away than the other two stations. 11:54AM EDT, April 19th. Wind speed: calm Wind direction: calm Cloud cover: overcast with light rain Air temp: 44F Humidity: 93%

11
CHK00006297