STATE OF OREGON DEPARTMENT OF STATE LANDS GEOTHERMAL EXPLORATION PERMIT No: 49458-GE THE State of Oregon, acting by and through the Department of State Lands (STATE), hereby grants to the person(s) herein named (PERMITTEE), a nonexclusive Geothermal Exploration (Permit) to explore the premises described in attached Exhibit A (PREMISES), subject to the terms and conditions specified herein. This Permit is issued pursuant to ORS 273.551, 273.780 and the administrative rules adopted thereunder, the terms of which are hereby incorporated and made a part of this Permit. This Permit shall not be effective until executed by STATE. Name of PERMITTEE

Address

Oregon Dept. of Geology and Mineral Industries

800 NE Oregon Street #28 Portland, Oregon 97232

1.

PURPOSE

PERMITTEE may drill a thermal gradient well in the pre-existing disturbed site upon, in and under the premises as described in exhibit “A”. Upon completion the well will be plugged and restored to its original condition. 2.

TERM

This Permit shall commence on May 1, 2012, and automatically expire on April 30, 2013. It may be terminated prior to that date as set forth below. 3.

TRANSFERABILITY

This Permit may be transferred or assigned only on prior written consent of STATE. Any transfer or assignment or attempted transfer or assignment without such consent shall be absolutely null and void and may, at the option of STATE, terminate all rights of the PERMITTEE under or by virtue of this Permit.

4.

NONEXCLUSIVITY

This Permit is nonexclusive and is subject to the rights and interests of any other persons or entities under any prior or subsequently authorized operation. 5.

WARRANTY OF TITLE

The STATE makes no representation or warranty whatsoever with respect to the title to the surface of the PREMISES. PERMITTEE shall be solely responsible for satisfying itself with respect to the ownership of such lands and obtaining concurrence of the SURFACE OWNER(S) to this Permit. 6.

SURFACE USE

If the surface of the PREMISES is STATE owned, the PREMISES shall remain open to the public except insofar as such public use unreasonably interferes with PERMITTEE’S operations under this Permit. Such determination of unreasonable interference must be mutually agreed upon by STATE and PERMITTEE. PERMITTEE’s operation shall not interfere with the use of the land surface by others under existing leases, contracts, permits or other interests granted by the SURFACE OWNER(S) without first obtaining permission from such users. Additional grants or permits for surface use may be issued to other persons or entities. 7.

SUBSURFACE USE

The oil and gas rights associated with the PREMISES are leased to those parties shown on Exhibit A. This Permit grants no right of entry or use to mineral rights so leased except the survey activities specifically allowed by this Permit. PERMITTEE is responsible for obtaining such permission as is necessary from those parties shown on Exhibit A who have leased the oil and gas rights, their successors of assigns, before proceeding under this Permit. 8.

BOND-N/A

Permittee shall maintain a $1,000 Check in-lieu of bond with the STATE to guarantee its performance under this Permit. If the PERMITTEE fully complies with the terms and conditions of this Permit, said check shall be returned to the PERMITTEE within thirty days after termination of this Permit. However, should PERMITTEE fail to comply with the terms and conditions of this Permit, the STATE may charge said check with an amount as is necessary to cure any breach of performance under this Permit.

Page 2 of 5 No: 49458-GE

9.

INSURANCE- N/A

PERMITTEE shall maintain comprehensive or commercial general liability insurance covering personal injury and property damage during the term of this Permit. This insurance shall include contractual liability coverage for the indemnity provided under this Permit. Coverage limits shall be for public liability and property damage insurance of at least: $20,000, $40,000, and $20,000. The property damage shall include damage by fire, which loss or damage results from the activity of PERMITTEE. Insurance may be evidenced by certificates or by copies of policies. The company or companies issuing insurance shall be of policies. The company or companies issuing insurance shall be acceptable to the SURFACE OWNER, if a state agency, and to STATE. The State of Oregon, the Department of State Lands and the SURFACE OWNER, if a state agency, shall be named as additional insured on the above-required policies. In lieu of the above-required types and amounts of insurance coverage, PERMITTEE may provide a certified balance sheet for a segregated self-insurance fund showing net worth of liquid assets in amounts equal to or exceeding the required insurance coverage. 10.

COMPLIANCE WITH LAW

PERMITTEE shall comply with all applicable federal, state and local statutes, ordinances, rules and regulations affecting the PREMISES and the use thereof. This Permit does not give PERMITTEE permission to conduct any use on the Premises which is not in conformance with the applicable land use requirements. PERMITTEE shall correct at PERMITTEE’s own expense any failure of compliance created through PERMITTEE’s fault or negligence or by reason of PERMITTEE’s use. PERMITTEE shall use the Premises only in a manner, or for such purposes, that assure fair and nondiscriminatory treatment of all persons without respect to race, creed, color, religion, handicap, disability, age, gender or national origin. 11.

TAXES, LIENS, ASSESSMENTS, CHARGES

PERMITTEE shall pay and discharge as they come due any taxes, assessments, penalties, charges, rates or liens of any nature that may be levied, assessed, charged, imposed or claimed against the PREMISES arising out of or in connection with PERMITTEE’s use of the PREMISES. 12.

INDEMNIFICATION

PERMITTEE agrees to defend and hold STATE, the SURFACE OWNER(S), if a state agency, and all officers, agents and employees of the STATE and the SURFACE OWNER, if a state agency, harmless from any and all claims suffered or Page 3 of 5 No: 49458-GE

alleged to have been suffered on the PREMISES or arising out of or in connection with actions or operations on the PREMISES pursuant to this Permit. 13.

PREVENTION OF WASTE AND DAMAGE

PERMITTEE shall exercise reasonable diligence in its exploration of the PREMISES; shall carry on all operations hereunder in a good and workmanlike manner having due regard for public safety, the prevention of waste and the restoration and conservation of the PREMISES for future use; shall comply with the terms and conditions of the General Operating Conditions and Operations plan(s) attached hereto as Exhibits B & C, respectively; shall take all reasonable steps to avoid unnecessary damage to soil, timber, fish and fish habitat, wildlife and wildlife habitat and water quality of both ground water and surface water; shall make all reasonable efforts to minimize interference with existing recreational activities and scenic values; shall insofar as possible restore the PREMISES to its former condition except as otherwise may be approved or ordered by the STATE; and shall do all things reasonably necessary to minimize erosion. 14.

TERMINATION

In the event that PERMITTEE fails to comply with any of the terms and conditions of this Permit and the attached exhibits, STATE may at its option terminate this Permit. STATE and PERMITTEE may also terminate this Permit upon mutual written consent. 15.

EXHIBITS

All exhibits hereto are expressly incorporated herein by reference. 16.

ATTORNEY FEES

If suit or action is instituted in connection with any controversy arising out of or on connection with this Permit, the prevailing party shall be entitled to recover all costs and disbursements incurred, including such sum as the court may adjudge reasonable as attorney fees. 17.

MODIFICATION

This Permit may be changed, altered or amended only by mutual written consent of the parties.

Page 4 of 5 No: 49458-GE

18.

MERGER

This Permit constitutes the entire agreement between the parties, and no oral statement, representation or agreement not herein expressed shall be binding upon any party. 19.

EFFECT OF WAIVER

Failure of STATE to demand rigid adherence to any of the terms of this Permit on any occasion shall not be construed as a waiver of any of the terms of this Permit and such conduct shall not deprive STATE of the right thereafter to insist on strict compliance with any of the terms of this permit. 20.

NOTICES

Any notices required or permitted under this Permit shall be in writing and deemed given three (3) days after deposited, postage prepaid, in the United States mail as regular mail and directed to the address provided below or to such other address as may be specified from time to time by either of the parties in writing. For STATE:

DEPARTMENT OF STATE LANDS 1645 NE Forbes Rd. Suite 112 Bend, OR 97701

For PERMITTEE:

DOGAMI 800 NE Oregon Street #28 Portland, OR 97232

The above terms, conditions and all attachments to this document are accepted by the undersigned. STATE OF OREGON DEPARTMENT OF STATE LANDS Authorized Signature Dated:

DOGAMI

by Title/Position Date: Page 5 of 5 No: 49458-GE

STATE OF OREGON DEPARTMENT OF STATE LANDS GEOTHERMAL EXPLORATION PERMIT No: 49537-GE THE State of Oregon, acting by and through the Department of State Lands (STATE), hereby grants to the person(s) herein named (PERMITTEE), a nonexclusive Geothermal Exploration (Permit) to explore the premises described in attached Exhibit A (PREMISES), subject to the terms and conditions specified herein. This Permit is issued pursuant to ORS 273.551, 273.780 and the administrative rules adopted thereunder, the terms of which are hereby incorporated and made a part of this Permit. This Permit shall not be effective until executed by STATE. Name of PERMITTEE

Address

Oregon Dept. of Geology and Mineral Industries

800 NE Oregon Street #28 Portland, Oregon 97232

1.

PURPOSE

PERMITTEE may drill a thermal gradient well in the pre-existing disturbed site upon, in and under the premises as described in exhibit “A”. Upon completion the well will be plugged and restored to its original condition. 2.

TERM

This Permit shall commence on May 1, 2012, and automatically expire on April 30, 2013. It may be terminated prior to that date as set forth below. 3.

TRANSFERABILITY

This Permit may be transferred or assigned only on prior written consent of STATE. Any transfer or assignment or attempted transfer or assignment without such consent shall be absolutely null and void and may, at the option of STATE, terminate all rights of the PERMITTEE under or by virtue of this Permit.

4.

NONEXCLUSIVITY

This Permit is nonexclusive and is subject to the rights and interests of any other persons or entities under any prior or subsequently authorized operation. 5.

WARRANTY OF TITLE

The STATE makes no representation or warranty whatsoever with respect to the title to the surface of the PREMISES. PERMITTEE shall be solely responsible for satisfying itself with respect to the ownership of such lands and obtaining concurrence of the SURFACE OWNER(S) to this Permit. 6.

SURFACE USE

If the surface of the PREMISES is STATE owned, the PREMISES shall remain open to the public except insofar as such public use unreasonably interferes with PERMITTEE’S operations under this Permit. Such determination of unreasonable interference must be mutually agreed upon by STATE and PERMITTEE. PERMITTEE’s operation shall not interfere with the use of the land surface by others under existing leases, contracts, permits or other interests granted by the SURFACE OWNER(S) without first obtaining permission from such users. Additional grants or permits for surface use may be issued to other persons or entities. 7.

SUBSURFACE USE

The oil and gas rights associated with the PREMISES are leased to those parties shown on Exhibit A. This Permit grants no right of entry or use to mineral rights so leased except the survey activities specifically allowed by this Permit. PERMITTEE is responsible for obtaining such permission as is necessary from those parties shown on Exhibit A who have leased the oil and gas rights, their successors of assigns, before proceeding under this Permit. 8.

BOND-N/A

Permittee shall maintain a $1,000 Check in-lieu of bond with the STATE to guarantee its performance under this Permit. If the PERMITTEE fully complies with the terms and conditions of this Permit, said check shall be returned to the PERMITTEE within thirty days after termination of this Permit. However, should PERMITTEE fail to comply with the terms and conditions of this Permit, the STATE may charge said check with an amount as is necessary to cure any breach of performance under this Permit.

Page 2 of 5 No: 49537-GE

9.

INSURANCE- N/A

PERMITTEE shall maintain comprehensive or commercial general liability insurance covering personal injury and property damage during the term of this Permit. This insurance shall include contractual liability coverage for the indemnity provided under this Permit. Coverage limits shall be for public liability and property damage insurance of at least: $20,000, $40,000, and $20,000. The property damage shall include damage by fire, which loss or damage results from the activity of PERMITTEE. Insurance may be evidenced by certificates or by copies of policies. The company or companies issuing insurance shall be of policies. The company or companies issuing insurance shall be acceptable to the SURFACE OWNER, if a state agency, and to STATE. The State of Oregon, the Department of State Lands and the SURFACE OWNER, if a state agency, shall be named as additional insured on the above-required policies. In lieu of the above-required types and amounts of insurance coverage, PERMITTEE may provide a certified balance sheet for a segregated self-insurance fund showing net worth of liquid assets in amounts equal to or exceeding the required insurance coverage. 10.

COMPLIANCE WITH LAW

PERMITTEE shall comply with all applicable federal, state and local statutes, ordinances, rules and regulations affecting the PREMISES and the use thereof. This Permit does not give PERMITTEE permission to conduct any use on the Premises which is not in conformance with the applicable land use requirements. PERMITTEE shall correct at PERMITTEE’s own expense any failure of compliance created through PERMITTEE’s fault or negligence or by reason of PERMITTEE’s use. PERMITTEE shall use the Premises only in a manner, or for such purposes, that assure fair and nondiscriminatory treatment of all persons without respect to race, creed, color, religion, handicap, disability, age, gender or national origin. 11.

TAXES, LIENS, ASSESSMENTS, CHARGES

PERMITTEE shall pay and discharge as they come due any taxes, assessments, penalties, charges, rates or liens of any nature that may be levied, assessed, charged, imposed or claimed against the PREMISES arising out of or in connection with PERMITTEE’s use of the PREMISES. 12.

INDEMNIFICATION

PERMITTEE agrees to defend and hold STATE, the SURFACE OWNER(S), if a state agency, and all officers, agents and employees of the STATE and the SURFACE OWNER, if a state agency, harmless from any and all claims suffered or Page 3 of 5 No: 49537-GE

alleged to have been suffered on the PREMISES or arising out of or in connection with actions or operations on the PREMISES pursuant to this Permit. 13.

PREVENTION OF WASTE AND DAMAGE

PERMITTEE shall exercise reasonable diligence in its exploration of the PREMISES; shall carry on all operations hereunder in a good and workmanlike manner having due regard for public safety, the prevention of waste and the restoration and conservation of the PREMISES for future use; shall comply with the terms and conditions of the General Operating Conditions and Operations plan(s) attached hereto as Exhibits B & C, respectively; shall take all reasonable steps to avoid unnecessary damage to soil, timber, fish and fish habitat, wildlife and wildlife habitat and water quality of both ground water and surface water; shall make all reasonable efforts to minimize interference with existing recreational activities and scenic values; shall insofar as possible restore the PREMISES to its former condition except as otherwise may be approved or ordered by the STATE; and shall do all things reasonably necessary to minimize erosion. 14.

TERMINATION

In the event that PERMITTEE fails to comply with any of the terms and conditions of this Permit and the attached exhibits, STATE may at its option terminate this Permit. STATE and PERMITTEE may also terminate this Permit upon mutual written consent. 15.

EXHIBITS

All exhibits hereto are expressly incorporated herein by reference. 16.

ATTORNEY FEES

If suit or action is instituted in connection with any controversy arising out of or on connection with this Permit, the prevailing party shall be entitled to recover all costs and disbursements incurred, including such sum as the court may adjudge reasonable as attorney fees. 17.

MODIFICATION

This Permit may be changed, altered or amended only by mutual written consent of the parties.

Page 4 of 5 No: 49537-GE

18.

MERGER

This Permit constitutes the entire agreement between the parties, and no oral statement, representation or agreement not herein expressed shall be binding upon any party. 19.

EFFECT OF WAIVER

Failure of STATE to demand rigid adherence to any of the terms of this Permit on any occasion shall not be construed as a waiver of any of the terms of this Permit and such conduct shall not deprive STATE of the right thereafter to insist on strict compliance with any of the terms of this permit. 20.

NOTICES

Any notices required or permitted under this Permit shall be in writing and deemed given three (3) days after deposited, postage prepaid, in the United States mail as regular mail and directed to the address provided below or to such other address as may be specified from time to time by either of the parties in writing. For STATE:

DEPARTMENT OF STATE LANDS 1645 NE Forbes Rd. Suite 112 Bend, OR 97701

For PERMITTEE:

DOGAMI 800 NE Oregon Street #28 Portland, OR 97232

The above terms, conditions and all attachments to this document are accepted by the undersigned. STATE OF OREGON DEPARTMENT OF STATE LANDS Authorized Signature Dated:

DOGAMI

by Title/Position Date: Page 5 of 5 No: 49537-GE

STATE OF OREGON DEPARTMENT OF STATE LANDS GEOTHERMAL EXPLORATION PERMIT No: 49455-GE THE State of Oregon, acting by and through the Department of State Lands (STATE), hereby grants to the person(s) herein named (PERMITTEE), a nonexclusive Geothermal Exploration Permit (Permit) to explore the premises described in attached Exhibit A (PREMISES), subject to the terms and conditions specified herein. This Permit is issued pursuant to ORS 273.551, 273.780 and the administrative rules adopted thereunder, the terms of which are hereby incorporated and made a part of this Permit. This Permit shall not be effective until executed by STATE. Name of PERMITTEE

Address

Oregon Dept. of Geology and Mineral Industries

800 NE Oregon Street #28 Portland, Oregon 97232

1.

PURPOSE

PERMITTEE may drill a thermal gradient well in the pre-existing disturbed site upon, in and under the premises as described in exhibit “A”. Upon completion the well will be plugged and restored to its original condition. 2.

TERM

This Permit shall commence on May 1, 2012, and automatically expire on April 30, 2013. It may be terminated prior to that date as set forth below. 3.

TRANSFERABILITY

This Permit may be transferred or assigned only on prior written consent of STATE. Any transfer or assignment or attempted transfer or assignment without such consent shall be absolutely null and void and may, at the option of STATE, terminate all rights of the PERMITTEE under or by virtue of this Permit.

4.

NONEXCLUSIVITY

This Permit is nonexclusive and is subject to the rights and interests of any other persons or entities under any prior or subsequently authorized operation. 5.

WARRANTY OF TITLE

The STATE makes no representation or warranty whatsoever with respect to the title to the surface of the PREMISES. PERMITTEE shall be solely responsible for satisfying itself with respect to the ownership of such lands and obtaining concurrence of the SURFACE OWNER(S) to this Permit. 6.

SURFACE USE

If the surface of the PREMISES is STATE owned, the PREMISES shall remain open to the public except insofar as such public use unreasonably interferes with PERMITTEE’S operations under this Permit. Such determination of unreasonable interference must be mutually agreed upon by STATE and PERMITTEE. PERMITTEE’s operation shall not interfere with the use of the land surface by others under existing leases, contracts, permits or other interests granted by the SURFACE OWNER(S) without first obtaining permission from such users. Additional grants or permits for surface use may be issued to other persons or entities. 7.

SUBSURFACE USE

The oil and gas rights associated with the PREMISES are leased to those parties shown on Exhibit A. This Permit grants no right of entry or use to mineral rights so leased except the survey activities specifically allowed by this Permit. PERMITTEE is responsible for obtaining such permission as is necessary from those parties shown on Exhibit A who have leased the oil and gas rights, their successors of assigns, before proceeding under this Permit. 8.

BOND-N/A

Permittee shall maintain a $1,000 Check in-lieu of bond with the STATE to guarantee its performance under this Permit. If the PERMITTEE fully complies with the terms and conditions of this Permit, said check shall be returned to the PERMITTEE within thirty days after termination of this Permit. However, should PERMITTEE fail to comply with the terms and conditions of this Permit, the STATE may charge said check with an amount as is necessary to cure any breach of performance under this Permit.

Page 2 of 5 No: 49455-GE

9.

INSURANCE- N/A

PERMITTEE shall maintain comprehensive or commercial general liability insurance covering personal injury and property damage during the term of this Permit. This insurance shall include contractual liability coverage for the indemnity provided under this Permit. Coverage limits shall be for public liability and property damage insurance of at least: $20,000, $40,000, and $20,000. The property damage shall include damage by fire, which loss or damage results from the activity of PERMITTEE. Insurance may be evidenced by certificates or by copies of policies. The company or companies issuing insurance shall be of policies. The company or companies issuing insurance shall be acceptable to the SURFACE OWNER, if a state agency, and to STATE. The State of Oregon, the Department of State Lands and the SURFACE OWNER, if a state agency, shall be named as additional insured on the above-required policies. In lieu of the above-required types and amounts of insurance coverage, PERMITTEE may provide a certified balance sheet for a segregated self-insurance fund showing net worth of liquid assets in amounts equal to or exceeding the required insurance coverage. 10.

COMPLIANCE WITH LAW

PERMITTEE shall comply with all applicable federal, state and local statutes, ordinances, rules and regulations affecting the PREMISES and the use thereof. This Permit does not give PERMITTEE permission to conduct any use on the Premises which is not in conformance with the applicable land use requirements. PERMITTEE shall correct at PERMITTEE’s own expense any failure of compliance created through PERMITTEE’s fault or negligence or by reason of PERMITTEE’s use. PERMITTEE shall use the Premises only in a manner, or for such purposes, that assure fair and nondiscriminatory treatment of all persons without respect to race, creed, color, religion, handicap, disability, age, gender or national origin. 11.

TAXES, LIENS, ASSESSMENTS, CHARGES

PERMITTEE shall pay and discharge as they come due any taxes, assessments, penalties, charges, rates or liens of any nature that may be levied, assessed, charged, imposed or claimed against the PREMISES arising out of or in connection with PERMITTEE’s use of the PREMISES. 12.

INDEMNIFICATION

PERMITTEE agrees to defend and hold STATE, the SURFACE OWNER(S), if a state agency, and all officers, agents and employees of the STATE and the SURFACE OWNER, if a state agency, harmless from any and all claims suffered or Page 3 of 5 No: 49455-GE

alleged to have been suffered on the PREMISES or arising out of or in connection with actions or operations on the PREMISES pursuant to this Permit. 13.

PREVENTION OF WASTE AND DAMAGE

PERMITTEE shall exercise reasonable diligence in its exploration of the PREMISES; shall carry on all operations hereunder in a good and workmanlike manner having due regard for public safety, the prevention of waste and the restoration and conservation of the PREMISES for future use; shall comply with the terms and conditions of the General Operating Conditions and Operations plan(s) attached hereto as Exhibits B & C, respectively; shall take all reasonable steps to avoid unnecessary damage to soil, timber, fish and fish habitat, wildlife and wildlife habitat and water quality of both ground water and surface water; shall make all reasonable efforts to minimize interference with existing recreational activities and scenic values; shall insofar as possible restore the PREMISES to its former condition except as otherwise may be approved or ordered by the STATE; and shall do all things reasonably necessary to minimize erosion. 14.

TERMINATION

In the event that PERMITTEE fails to comply with any of the terms and conditions of this Permit and the attached exhibits, STATE may at its option terminate this Permit. STATE and PERMITTEE may also terminate this Permit upon mutual written consent. 15.

EXHIBITS

All exhibits hereto are expressly incorporated herein by reference. 16.

ATTORNEY FEES

If suit or action is instituted in connection with any controversy arising out of or on connection with this Permit, the prevailing party shall be entitled to recover all costs and disbursements incurred, including such sum as the court may adjudge reasonable as attorney fees. 17.

MODIFICATION

This Permit may be changed, altered or amended only by mutual written consent of the parties.

Page 4 of 5 No: 49455-GE

18.

MERGER

This Permit constitutes the entire agreement between the parties, and no oral statement, representation or agreement not herein expressed shall be binding upon any party. 19.

EFFECT OF WAIVER

Failure of STATE to demand rigid adherence to any of the terms of this Permit on any occasion shall not be construed as a waiver of any of the terms of this Permit and such conduct shall not deprive STATE of the right thereafter to insist on strict compliance with any of the terms of this permit. 20.

NOTICES

Any notices required or permitted under this Permit shall be in writing and deemed given three (3) days after deposited, postage prepaid, in the United States mail as regular mail and directed to the address provided below or to such other address as may be specified from time to time by either of the parties in writing. For STATE:

DEPARTMENT OF STATE LANDS 1645 NE Forbes Rd. Suite 112 Bend, OR 97701

For PERMITTEE:

DOGAMI 800 NE Oregon Street #28 Portland, OR 97232

The above terms, conditions and all attachments to this document are accepted by the undersigned. STATE OF OREGON DEPARTMENT OF STATE LANDS Authorized Signature Dated:

DOGAMI

by Title/Position Date: Page 5 of 5 No: 49455-GE

DEPARTMENT OF STATE LANDS 1645 NE FORBES RD. Suite 112 Bend, Oregon 97701 (541) 388-6112 FAX (503) 388-6480

Geothermal Exploration Permit Application Applicant Name: Oregon Department of Geology and Mineral Industries Mailing Address: 800 NE Oregon Street #28

Telephone Number: 971-673-1540 City: Portland

State: OR

Zip: 97232

Land Owner Name and Address: State of Oregon-Oregon Department of State Lands (DSL). The proposed drill site is located at the foot of Baker Pass in Sunrise Valley, Malheur County where the Oregon Department of Transportation (ODOT) stockpiles gravel in ±0.77-acre area (approx. 340’ by 100’ in size) at the intersection (northeast side) of Highway 78 (Rome-Princeton or Steens Highway) and Crowley-Riverside Road, near milepost MP-65 (SE¼ NW¼, Sec. 16, Township 29 S., Range 37 E.). Currently, ODOT leases the stockpile site pursuant to Special Use Lease 44485-SU. Contractor Name and Address: Not available at this time. DOGAMI intends to Contract Telephone Number: 971-673-1540 with a single firm to provide well drilling services. The Contract will specify that the well driller (and related subcontractors) must be certified with the State of Oregon and posses all required licenses, current and in good standing to perform the Work. Estimate of the depths to be drilled: ±1,000 Length between shot holes: N/A Size of explosive charge: N/A

Resource to be explored for: The objective of this drilling and logging program is the installation of a thermal gradient well. The well is designed to acquire temperature measurements from inside a string of nominal 2-inch tubing, capped at the bottom and filled with clear water, which will allow the measurement of true formation temperature. Waterway or Site Name: Crowley-Riverside Road

River Mile: N/A

County: Malheur

Present site use: ODOT leases approximately ±0.77-acres of land at the Section: 16 Township: T. 29 S. Aforementioned location for road gravel storage USE ADDITIONAL SHEETS IF NECESSARY I Have Enclosed:

Range: R. 37 E.

 Location map sufficient to enable agency personnel to locate the site.  My fee of $50 (make check payable to Department of State Lands)  Evidence of insurance (Public Liability and Property Damage Insurance)  640 acres or less - $20,000, $40,000, $20,000 or  Over 640 acres - $50,000, $100,000, $50,000  And Contractual liability covering the permittee’s duty of indemnification of the State - $200,000  Surety Bond not less than $1,000  Exploration plan, including, but not limited to, exploration methods, dates of exploration, types of equipment to be used, and crew size. I certify that to the best of my knowledge, I am providing factual information in this application, which meets all applicable local, state, and federal laws including the local comprehensive plan and zoning requirements.

Applicant Signature

Date

Title

FOR OFFICE USE ONLY Permit Fee: 08/98 FO\Form\Application\Exploration Permit.doc

Date Paid:

Project File No.:

DEPARTMENT OF STATE LANDS 1645 NE FORBES RD. Suite 112 Bend, Oregon 97701 (541) 388-6112 FAX (503) 388-6480

Geothermal Exploration Permit Application Applicant Name: Oregon Department of Geology and Mineral Industries Mailing Address: 800 NE Oregon Street #28

Telephone Number: 971-673-1540 City: Portland

State: OR

Zip: 97232

Land Owner Name and Address: The Oregon Department of Transportation’s (ODOT) owns this ±50.5-acre gravel pit, of which an area of ±26-acres is disturbed. The proposed drill site is called the Picture Rock Gravel Pit and located at the mouth of Picture Rock Pass heading south into the basin of Summer Lake, Lake County. This pit is immediately east of Hwy 31, near milepost MP-66 heading south towards Summer Lake (SW¼ NE¼, Sec. 36, T. 29 S., R. 16 E.). The pit is active. Contractor Name and Address: Not available at this time. DOGAMI intends to Contract Telephone Number: 971-673-1540 with a single firm to provide well drilling services. The Contract will specify that the well driller (and related subcontractors) must be certified with the State of Oregon and posses all required licenses, current and in good standing to perform the Work. Estimate of the depths to be drilled: ±1,000 Length between shot holes: N/A Size of explosive charge: N/A

Resource to be explored for: The objective of this drilling and logging program is the installation of a thermal gradient well. The well is designed to acquire temperature measurements from inside a string of nominal 2-inch tubing, capped at the bottom and filled with clear water, which will allow the measurement of true formation temperature. Waterway or Site Name: Picture Rock Gravel Pit Present site use: ODOT gravel pit

River Mile: N/A

County: Lake

Section: 36 Township: T. 29 S. USE ADDITIONAL SHEETS IF NECESSARY

Range: R. 16 E.

I Have Enclosed:

 Location map sufficient to enable agency personnel to locate the site.  My fee of $50 (make check payable to Department of State Lands)  Evidence of insurance (Public Liability and Property Damage Insurance)  640 acres or less - $20,000, $40,000, $20,000 or  Over 640 acres - $50,000, $100,000, $50,000  And Contractual liability covering the permittee’s duty of indemnification of the State - $200,000  Surety Bond not less than $1,000  Exploration plan, including, but not limited to, exploration methods, dates of exploration, types of equipment to be used, and crew size. I certify that to the best of my knowledge, I am providing factual information in this application, which meets all applicable local, state, and federal laws including the local comprehensive plan and zoning requirements.

Applicant Signature

Date

Title

FOR OFFICE USE ONLY Permit Fee: 08/98 FO\Form\Application\Exploration Permit.doc

Date Paid:

Project File No.:

DEPARTMENT OF STATE LANDS 1645 NE FORBES RD. Suite 112 Bend, Oregon 97701 (541) 388-6112 FAX (503) 388-6480

Geothermal Exploration Permit Application Applicant Name: Oregon Department of Geology and Mineral Industries Mailing Address: 800 NE Oregon Street #28

Telephone Number: 971-673-1540 City: Portland

State: OR

Zip: 97232

Land Owner Name and Address: The land owner is the Oregon Military Department (OMD) which acquired at least part of the former USAF Over The Horizon Backscatter Radar air defense system in Christmas Valley, Lake County, Oregon. The proposed drill site is the southern-most radar antenna, called Sector 6 (SW¼ SW¼, Sec. 31, T. 26 S., R. 20 E.), within a disturbed area next to a warehouse building. To reach the radar station, travel 16 miles east on Wagontire Road (County Rd., No. 5-14) from the community of Christmas Valley and then turn left (north) on County Rd., No. 5-14f. Continue on this road another 1.5 miles at which point the road leading to the Sector 6 area is to the right. Contractor Name and Address: Not available at this time. DOGAMI intends to Contract with a single firm to provide well drilling services. The Contract will specify that the well driller (and related subcontractors) must be certified with the State of Oregon and posses all required licenses, current and in good standing to perform the Work. Estimate of the depths to be drilled: ±1,000 Length between shot holes: N/A

Telephone Number: 971-673-1540

Size of explosive charge: N/A

Resource to be explored for: The objective of this drilling and logging program is the installation of a thermal gradient well. The well is designed to acquire temperature measurements from inside a string of nominal 2-inch tubing, capped at the bottom and filled with clear water, which will allow the measurement of true formation temperature. Waterway or Site Name: Oregon Military Department Radar River Mile: N/A County: Lake Site (Sector 6) Present site use: Former radar site Section: 31 Township: T. 26 S. USE ADDITIONAL SHEETS IF NECESSARY I Have Enclosed:

Range: R. 20 E.

 Location map sufficient to enable agency personnel to locate the site.  My fee of $50 (make check payable to Department of State Lands)  Evidence of insurance (Public Liability and Property Damage Insurance)  640 acres or less - $20,000, $40,000, $20,000 or  Over 640 acres - $50,000, $100,000, $50,000  And Contractual liability covering the permittee’s duty of indemnification of the State - $200,000  Surety Bond not less than $1,000  Exploration plan, including, but not limited to, exploration methods, dates of exploration, types of equipment to be used, and crew size. I certify that to the best of my knowledge, I am providing factual information in this application, which meets all applicable local, state, and federal laws including the local comprehensive plan and zoning requirements.

Applicant Signature

Date

Title

FOR OFFICE USE ONLY Permit Fee: 08/98 FO\Form\Application\Exploration Permit.doc

Date Paid:

Project File No.:

Oregon Department of Geology and Mineral Industries February 6, 2012

EXPLORATION PLAN CROWLEY-RIVERSIDE ROAD MALHEUR COUNTY, OREGON General Information The Oregon Department of Geology and Mineral Industries (DOGAMI) is submitting to the Oregon Department of State Lands (ODSL) an exploration plan to conduct geothermal exploration drilling in the Crowley Road project area, Malheur County, Oregon (see Location Information). Under this exploration plan DOGAMI proposes to drill a single thermal (temperature) gradient well. This drilling effort is part of the Geothermal Data project of the Association of American State Geologists which brings data from all fifty states into the National Geothermal Data System (NGDS). The purpose of the well is to collect new information in the Sunrise Valley, Malheur County, because this location has geologic potential and access to transmission lines but do not have existing geothermal leases or exploration wells or obvious cultural/environmental restrictions. Proposed Exploration Activities DOGAMI proposes the following activities: • • • • •

Preparation of the drilling site Drilling one (1) temperature gradient well Data collection of the drilled well; geologic mapping of the immediate vicinity Monitoring static temperature gradient in the well Upon project completion, plugging and abandonment of the well and site restoration

Note: The proposed well is not for geothermal resource production, injection, or well testing, nor is it used for geophysical operations such as a hole used for explosive charges for seismic exploration, core drilling, or other drilling methods. Equipment Used The proposed well will be drilled with a typical water well rig. Type of drilling operation would be either air, preferred; but mud-rotary if necessary. Support vehicles will include a tanker/water truck, pipe truck/trailer, and pick-up truck(s). DOGAMI does not propose to utilize new techniques or unusual technologies for this work. Location Information This narrative defines the proposed location. The proposed drilling site (Site) is located at the foot of Baker Pass in Sunrise Valley, Malheur County, Oregon (SE¼ NW¼, Sec. 16, Township 29 S., Range 37 E.). Conditions of the Site can be seen in Figure 1 and 2. The Site is a gravel stockpile area (±0.77-acres; 340 feet by 100 feet in size), at the intersection of Highway 78 (Rome-Princeton or Steens Highway) and Crowley-Riverside Road, near milepost MP-65. It is state-owned land. Currently, the Oregon Department of Transportation (ODOT) has leased the stockpiling area from the Oregon Department of State Lands under Special Use Lease 44485-SU (see Attachment).

Page 1 of 6 Crowley-Riverside Road Geothermal Exploration Permit Application

Oregon Department of Geology and Mineral Industries February 6, 2012

Conditions The Site was purposefully chosen because the surface has already been disturbed. The area of the Site can accommodate the drill rig, tanker truck(s), trailer(s), and other vehicles within the disturbed area and, if necessary parking along the adjoining Crowley-Riverside Road. There would be no Site preparation or change to existing vegetation involved in order to safely accommodate this equipment. Access to the Site is shown in Figure 1. No new roads or well site construction are necessary that would require any earth moving or site clearance operations. Well placement proposed in this plan would be in the disturbed area at least a 100 feet away from Crowley-Riverside road/Highway 78. The drilling pad for the well would be approximately 30 feet by 45 feet in size. No ancillary facilities are required. DOGAMI has concluded there are no surface or subsurface geological or manmade features or conditions that may adversely affect the proposed activities. No impacts on cultural resources or threaten and endangered species are expect as a result of the proposed operation. Geological and Geophysical Information The objectives of this drilling and logging program are to 1) obtain the best definition of the underlying rock units, 2) obtain static temperature-gradient measurements, and 3) collect hydrologic information related to the well. We also propose to prepare a detailed geologic map of the immediate vicinity to provide geologic context for the temperature gradient well. This mapping will include petrographic and geochemical characterization of volcanic rocks as well as Ar40/Ar39 dating. DOGAMI staff will also log the hole as it is drilled, collecting water samples, and cuttings for analysis. DOGAMI will publish the results of the drilling as an Open File Report and will add the data to the NGDS. Exploration Method As shown in Figure 3, the thermal gradient well will be drilled to a nominal depth of 300 meters (1,000 feet). It is anticipated that the well will be tri-coned, 9⅞ inch, using a reverse circulation system. The 8⅝ inch black conductor casing will be set to approximately 6 m (20 ft). Rotary drilling 7⅞ inch would continue to bedrock. The 6⅝ inch flush joint surface casing would be set into bedrock, possibly up to 120 m (400 ft). The hole would be air-percussion or rotary drilled 5⅞ inch to total depth of 300 m (1000 ft). The completed well will be lined with two-inch flush joint black steel pipe or PVC equivalent, capped at the bottom. The annulus will be sealed with bentonite plus cement plugs. The 9⅞ inch casing will be pulled and a cement plug placed at the collar. The 2-inch pipe will be filled with water, capped, and allowed to remain static. The well will be completely sealed from the environment so as not to allow any contamination. Drilling Fluids/Waste Disposal Water for drilling will be trucked from off-site source(s). The selected well drilling Contractor will be responsible for off-site legal disposal of all cuttings and fluids (e.g. contaminated and mineralized groundwater) produced during drilling and other related waste disposal. When using mud fluid, portable mud tanks or portable mud pits shall be used. The Site shall kept free of drilling related rubbish and waste material. Page 2 of 6 Crowley-Riverside Road Geothermal Exploration Permit Application

Oregon Department of Geology and Mineral Industries February 6, 2012

Dates of Exploration The anticipated start date of proposed activities is October 2012; ending the same month. The number of days that there would be any human or mechanical activity is limited, and expected to be less than four days at the Site. Regulatory Compliance DOGAMI will contract the services of a single drilling firm (CONTRACTOR), licensed and bonded in the State of Oregon. This CONTRACTOR shall construct the Well in conformance with the Oregon Water Resources Department’s (OWRD)Well Construction Standards and all laws, rules, and regulations related to the construction of wells in the United States, State of Oregon, and any other applicable regulations. Well Abandonment and Plugging/Reclamation The CONTRACTOR will effectively manage and perform, either independently or through the use of subcontractors, the plugging and abandonment of the well in a manner consistent with local and/or OWRD regulations. Upon project completion, the well will be plugged and abandoned and the site restored to simulate pre-existing conditions, which may include top soil stabilization, backfilling, erosion control, and re-contouring (if needed). The Contractor will also take the necessary steps to seed the disturbed area (if needed).

Page 3 of 6 Crowley-Riverside Road Geothermal Exploration Permit Application

Oregon Department of Geology and Mineral Industries February 6, 2012

Figure 1: Location map for Crowley-Riverside Road project, Malheur County, Oregon Page 4 of 6 Crowley-Riverside Road Geothermal Exploration Permit Application

Oregon Department of Geology and Mineral Industries February 6, 2012

Figure 2: Site map for Crowley-Riverside Road project, Malheur County, Oregon Page 5 of 6 Crowley-Riverside Road Geothermal Exploration Permit Application

Oregon Department of Geology and Mineral Industries February 6, 2012

Figure 3: Schematic of thermal gradient well Page 6 of 6 Crowley-Riverside Road Geothermal Exploration Permit Application

Oregon Department of Geology and Mineral Industries February 7, 2012

EXPLORATION PLAN PICTURE ROCK GRAVEL PIT LAKE COUNTY, OREGON General Information The Oregon Department of Geology and Mineral Industries (DOGAMI) is submitting to the Oregon Department of State Lands (ODSL) an exploration plan to conduct geothermal exploration drilling in the north Summer Lake area, Lake County, Oregon (see Location Information). Under this exploration plan DOGAMI proposes to drill a single thermal (temperature) gradient well. This drilling effort is part of the Geothermal Data project of the Association of American State Geologists which brings data from all fifty states into the National Geothermal Data System (NGDS). The purpose of the well is to collect new information in the northern end of the Summer Lake Valley, Lake County, because this location has geologic potential and access to transmission lines but do not have existing geothermal leases or exploration wells or obvious cultural/environmental restrictions. Proposed Exploration Activities DOGAMI proposes the following activities:     

Preparation of the drilling site Drilling one (1) temperature gradient well Data collection of the drilled well; geologic mapping of the immediate vicinity Monitoring static temperature gradient in the well Upon project completion, plugging and abandonment of the well and site restoration

Note: The proposed well is not for geothermal resource production, injection, or well testing, nor is it used for geophysical operations such as a hole used for explosive charges for seismic exploration, core drilling, or other drilling methods. Equipment Used The proposed well will be drilled with a typical water well rig. Type of drilling operation would be either air, preferred; but mud-rotary if necessary. Support vehicles will include a tanker/water truck, pipe truck/trailer, and pick-up truck(s). DOGAMI does not propose to utilize new techniques or unusual technologies for this work. Location Information This narrative defines the proposed location. The proposed drilling site (Site) is located in the Picture Rock Gravel Pit (PRGP) near milepost MP-66, heading south on Highway 31 (Freemont Highway) towards Summer Lake, Lake County, Oregon (SW¼ NE¼, Sec. 36, T. 29 S., R. 16 E.). Conditions of the Site can be seen in Figure 1 and 2. The Oregon Department of Transportation (ODOT) owns this ±50.5-acre property, of which an area of ±26-acres is disturbed. Gravel is the primary commodity at this material site and ODOT lists the pit as active. However, no operations are underway at this time except for occasional stockpiling.

Page 1 of 6 Picture Rock Gravel Pit Geothermal Exploration Permit Application

Oregon Department of Geology and Mineral Industries February 7, 2012 Conditions Figure 2 shows the PRGP’s property boundary and existing disturbed area and topography. The upper area of the pit serves as a stockpile yard and load-out area. Also shown in Figure 2 is the approximate proposed location of drilling the WELL which is in the excavated area. The Site was purposefully chosen because the surface has already been disturbed. The area of the Site can easily accommodate the drill rig, tanker truck(s), trailer(s), and other vehicles within the disturbed area. There would be no Site preparation or change to existing vegetation involved in order to safely accommodate this equipment. Access to the Site is shown in Figure 1. No new roads or well site construction are necessary that would require any earth moving or site clearance operations. Well placement proposed in this plan would be in the pit area. The drilling pad for the well would be approximately 30 feet by 45 feet in size. No ancillary facilities are required. DOGAMI has concluded there are no surface or subsurface geological or manmade features or conditions that may adversely affect the proposed activities. No impacts on cultural resources or threaten and endangered species are expect as a result of the proposed operation. Geological and Geophysical Information The objectives of this drilling and logging program are to 1) obtain the best definition of the underlying rock units, 2) obtain static temperature-gradient measurements, and 3) collect hydrologic information related to the well. We also propose to prepare a detailed geologic map of the immediate vicinity to provide geologic context for the temperature gradient well. This mapping will include petrographic and geochemical characterization of volcanic rocks as well as Ar40/Ar39 dating. DOGAMI staff will also log the hole as it is drilled, collecting water samples, and cuttings for analysis. DOGAMI will publish the results of the drilling as an Open File Report and will add the data to the NGDS. Exploration Method As shown in Figure 3, the thermal gradient well will be drilled to a nominal depth of 300 meters (1,000 feet). It is anticipated that the well will be tri-coned, 9⅞ inch, using a reverse circulation system. The 8⅝ inch black conductor casing will be set to approximately 6 m (20 ft). Rotary drilling 7⅞ inch would continue to bedrock. The 6⅝ inch flush joint surface casing would be set into bedrock, possibly up to 120 m (400 ft). The hole would be air-percussion or rotary drilled 5⅞ inch to total depth of 300 m (1000 ft). The completed well will be lined with two-inch flush joint black steel pipe or PVC equivalent, capped at the bottom. The annulus will be sealed with bentonite plus cement plugs. The 9⅞ inch casing will be pulled and a cement plug placed at the collar. The 2-inch pipe will be filled with water, capped, and allowed to remain static. The well will be completely sealed from the environment so as not to allow any contamination. Drilling Fluids/Waste Disposal Water for drilling will be trucked from off-site source(s). The selected well drilling Contractor will be responsible for off-site legal disposal of all cuttings and fluids (e.g. contaminated and mineralized groundwater) produced during drilling and other related waste disposal. When using mud fluid, portable mud tanks or portable mud pits shall be used. The Site shall be kept free of drilling related rubbish and waste material. Page 2 of 6 Picture Rock Gravel Pit Geothermal Exploration Permit Application

Oregon Department of Geology and Mineral Industries February 7, 2012

Dates of Exploration The anticipated start date of proposed activities is October 2012; ending the same month. The number of days that there would be any human or mechanical activity is limited, and expected to be less than four days at the Site. Regulatory Compliance DOGAMI will contract the services of a single drilling firm (CONTRACTOR), licensed and bonded in the State of Oregon. This CONTRACTOR shall construct the Well in conformance with the Oregon Water Resources Department’s (OWRD)Well Construction Standards and all laws, rules, and regulations related to the construction of wells in the United States, State of Oregon, and any other applicable regulations. Well Abandonment and Plugging/Reclamation The CONTRACTOR will effectively manage and perform, either independently or through the use of subcontractors, the plugging and abandonment of the well in a manner consistent with local and/or OWRD regulations. Upon project completion, the well will be plugged and abandoned and the site restored to simulate pre-existing conditions, which may include top soil stabilization, backfilling, erosion control, and re-contouring (if needed). The Contractor will also take the necessary steps to seed the disturbed area (if needed).

Page 3 of 6 Picture Rock Gravel Pit Geothermal Exploration Permit Application

Oregon Department of Geology and Mineral Industries February 7, 2012

Figure 1: Location map for Picture Rock Gravel Pit project, Lake County, Oregon Page 4 of 6 Picture Rock Gravel Pit Geothermal Exploration Permit Application

Oregon Department of Geology and Mineral Industries February 7, 2012

Figure 2: Site map for Picture Rock Gravel Pit project, Lake County, Oregon Page 5 of 6 Picture Rock Gravel Pit Geothermal Exploration Permit Application

Oregon Department of Geology and Mineral Industries February 7, 2012

Figure 3: Schematic of thermal gradient well Page 6 of 6 Picture Rock Gravel Pit Geothermal Exploration Permit Application

Oregon Department of Geology and Mineral Industries February 7, 2012

EXPLORATION PLAN OREGON MILITARY DEPARTMENT RADAR SITE (SECTOR 6) LAKE COUNTY, OREGON General Information The Oregon Department of Geology and Mineral Industries (DOGAMI) is submitting to the Oregon Department of State Lands (ODSL) an exploration plan to conduct geothermal exploration drilling in the Oregon Military Department (OMD) Site project area, Christmas Valley, Lake County, Oregon (see Location Information). Under this exploration plan DOGAMI proposes to drill a single thermal (temperature) gradient well. This drilling effort is part of the Geothermal Data project of the Association of American State Geologists which brings data from all fifty states into the National Geothermal Data System (NGDS). The purpose of the well is to collect new information in the northern end of the Summer Lake Valley, Lake County, because this location has geologic potential and access to transmission lines but do not have existing geothermal leases or exploration wells or obvious cultural/environmental restrictions. Proposed Exploration Activities DOGAMI proposes the following activities: • • • • •

Preparation of the drilling site Drilling one (1) temperature gradient well Data collection of the drilled well; geologic mapping of the immediate vicinity Monitoring static temperature gradient in the well Upon project completion, plugging and abandonment of the well and site restoration

Note: The proposed well is not for geothermal resource production, injection, or well testing, nor is it used for geophysical operations such as a hole used for explosive charges for seismic exploration, core drilling, or other drilling methods. Equipment Used The proposed well will be drilled with a typical water well rig. Type of drilling operation would be either air, preferred; but mud-rotary if necessary. Support vehicles will include a tanker/water truck, pipe truck/trailer, and pick-up truck(s). DOGAMI does not propose to utilize new techniques or unusual technologies for this work. Location Information This narrative defines the proposed location. The proposed drilling site (Site) is the Oregon Military Department (OMD) property in Christmas Valley, northern Lake County, Oregon (SW¼ SW¼, Sec. 31, T. 26 S., R. 20 E.). The conditions of the OMD’s Site conditions are shown in Figure 1. The Air Force used the property for its Over The Horizon Backscatter Radar air defense radar system. It was never operational and decommissioned in 2005. Ownership of at least part of the radar station subsequently transferred to the Oregon Military Department. Although the system’s three radar antennae have been removed, the antennae’s support infrastructure remains, which include warehouse buildings, adjacent parking lots, access roads, etc. Page 1 of 6 Oregon Military Department Radar Site (Sector 6) Geothermal Exploration Permit Application

Oregon Department of Geology and Mineral Industries February 7, 2012

To reach the radar station, travel 16 miles east on Wagontire Road (County Rd., No. 5-14) from the community of Christmas Valley and then turn left (north) on County Rd., No. 5-14f. Continue on this road another 1.5 miles and then the road to the Sector 6 area is to the right. Conditions The proposed location of the well is the southern-most radar antenna, called Sector 6, in a disturbed area (work area) next to the warehouse building (Figure 2). The Site was purposefully chosen because the surface has already been disturbed. The area of the Site can easily accommodate the drill rig, tanker truck(s), trailer(s), and other vehicles within the disturbed area. There would be no Site preparation or change to existing vegetation involved in order to safely accommodate this equipment. Access to the Site is shown in Figure 1. No new roads or well site construction are necessary that would require any earth moving or site clearance operations. As mentioned above, well placement proposed in this plan would be in the work area. The drilling pad for the well would be approximately 30 feet by 45 feet in size. No ancillary facilities are required. DOGAMI has concluded there are no surface or subsurface geological or manmade features or conditions that may adversely affect the proposed activities. No impacts on cultural resources or threaten and endangered species are expect as a result of the proposed operation. Geological and Geophysical Information The objectives of this drilling and logging program are to 1) obtain the best definition of the underlying rock units, 2) obtain static temperature-gradient measurements, and 3) collect hydrologic information related to the well. We also propose to prepare a detailed geologic map of the immediate vicinity to provide geologic context for the temperature gradient well. This mapping will include petrographic and geochemical characterization of volcanic rocks as well as Ar40/Ar39 dating. DOGAMI staff will also log the hole as it is drilled, collecting water samples, and cuttings for analysis. DOGAMI will publish the results of the drilling as an Open File Report and will add the data to the NGDS. Exploration Method As shown in Figure 3, the thermal gradient well will be drilled to a nominal depth of 300 meters (1,000 feet). It is anticipated that the well will be tri-coned, 9⅞ inch, using a reverse circulation system. The 8⅝ inch black conductor casing will be set to approximately 6 m (20 ft). Rotary drilling 7⅞ inch would continue to bedrock. The 6⅝ inch flush joint surface casing would be set into bedrock, possibly up to 120 m (400 ft). The hole would be air-percussion or rotary drilled 5⅞ inch to total depth of 300 m (1000 ft). The completed well will be lined with two-inch flush joint black steel pipe or PVC equivalent, capped at the bottom. The annulus will be sealed with bentonite plus cement plugs. The 9⅞ inch casing will be pulled and a cement plug placed at the collar. The 2-inch pipe will be filled with water, capped, and allowed to remain static. The well will be completely sealed from the environment so as not to allow any contamination. Page 2 of 6 Oregon Military Department Radar Site (Sector 6) Geothermal Exploration Permit Application

Oregon Department of Geology and Mineral Industries February 7, 2012 Drilling Fluids/Waste Disposal Water for drilling will be trucked from off-site source(s). The selected well drilling Contractor will be responsible for off-site legal disposal of all cuttings and fluids (e.g. contaminated and mineralized groundwater) produced during drilling and other related waste disposal. When using mud fluid, portable mud tanks or portable mud pits shall be used. The Site shall be kept free of drilling related rubbish and waste material. Dates of Exploration The anticipated start date of proposed activities is October 2012; ending the same month. The number of days that there would be any human or mechanical activity is limited, and expected to be less than four days at the Site. Regulatory Compliance DOGAMI will contract the services of a single drilling firm (CONTRACTOR), licensed and bonded in the State of Oregon. This CONTRACTOR shall construct the Well in conformance with the Oregon Water Resources Department’s (OWRD)Well Construction Standards and all laws, rules, and regulations related to the construction of wells in the United States, State of Oregon, and any other applicable regulations. Well Abandonment and Plugging/Reclamation The CONTRACTOR will effectively manage and perform, either independently or through the use of subcontractors, the plugging and abandonment of the well in a manner consistent with local and/or OWRD regulations. Upon project completion, the well will be plugged and abandoned and the site restored to simulate pre-existing conditions, which may include top soil stabilization, backfilling, erosion control, and re-contouring (if needed). The Contractor will also take the necessary steps to seed the disturbed area (if needed).

Page 3 of 6 Oregon Military Department Radar Site (Sector 6) Geothermal Exploration Permit Application

Oregon Department of Geology and Mineral Industries February 7, 2012

Figure 1: Location map for the Oregon Military Department Radar project, Lake County, Oregon Page 4 of 6 Oregon Military Department Radar Site (Sector 6) Geothermal Exploration Permit Application

Oregon Department of Geology and Mineral Industries February 7, 2012

Figure 2: Site map for the Oregon Military Department Radar project, Lake County, Oregon Page 5 of 6 Oregon Military Department Radar Site (Sector 6) Geothermal Exploration Permit Application

Oregon Department of Geology and Mineral Industries February 7, 2012

Figure 3: Schematic of thermal gradient well Page 6 of 6 Oregon Military Department Radar Site (Sector 6) Geothermal Exploration Permit Application