PUBLIC HEARING ON A DRILLING PERMIT FOR SPRINT KARNES COUNTY DISPOSAL, LLC.° Call to order at 2:40 p.m. the Public Hearing on Application for a Drilling Permit for Sprint Karnes County Disposal, LLC. Party representing application: Brad Dugas, Bill Doherty, Stefan Stamoulis Protestant to application: None Public Comment: None. President McGuairt declared the application uncontested. Middle Pecos GCD Minutes for March 19, 2019 Page 13 The following were sworn in to testify: Brad Dugas/Sprint Energy and Stefan Stamoulis/Hydrogeologist, and Ty Edwards/MPGCD General Manager. Manager Ty Edwards presented the application to the Board. The application requests a drilling permit for Sprint Karnes County Disposal, LLC for Sprint Pecos County TRD STF Facility for 1 well located on Survey T&T RR CO Block OW Section 45 (206.8 acres) Property ID: 46063, approximately 1 mile East of FM 1776 and 1 mile South of Mobil Road in Pecos County, Texas The well is projected to be 450-500 feet in depth with an estimate rate of withdraw at 40 gallons per minute. The application requests to drill into the Pecos Valley Aquifer. Steven Hoelscher had been trying to sell this farm for a long time, one section of land. There are 5 wells on it currently and they all have Historical & Existing Use Permits. A couple of them are the Rustler Aquifer, and one of them flows. Mr. Swinbank brought the property last year. He did the change of ownerships. This property has been in CRP forever. He sold 206 acres of it to Sprint to put in a commercial disposal facility. Mr. Swinbank actually kept the water rights on all the sections, they just sold the surface. Sprint Karnes has agreed to plug 3 existing wells around the facility and the owner (Mr. Swinbank) plans on drilling replacement wells and to keep the H&E permits. The 3 wells to be plugged by Sprint Karnes are #2005100409 Well#1-West, and #2005100408 Well #2-Artesian, and #2005100407 Well#3-South. The disposal facility will go there, they basically dig big pits, line them, and bury horizontal drill cuttings. This is the second facility that has been approved in Pecos County. It is the first one that is actually being built. They are under construction currently. We have a letter from Mr. Swinbank authorizing Sprint Karnes to drill this well and produce it. They are only going to request 60 to 65 acre feet production after they drill this well and pump test it. MPGCD will put full time monitoring equipment in it. Sprint Karnes have already agreed in writing to put it in, and they are going to pull water quality measurements quarterly, and that is one of the things that we requested of them to remove our protest. We protested their facility - they agreed to put in some monitor wells — which the Railroad Commission was not going to make them do because of the way the geology is in that area. Pecos County did not protest even though their water field is nearby. Brad Dugas testimony: We are requesting this water well for our own use. None of it will ever be sold. This water well will be an MPGCD monitor well. We need it for safety if there are fire issues, but more predominantly for dust control. We have a wash-out application that we use, and we need some clean freshwater for that to run through our high pressure system. We have commercial treatment facilities that are permitted by the Railroad Commission to support oil and gas production. We have a double lined system, the long term interment is for this waste that includes water-base mud, oil-based mud, oil-based cuttings, Middle Pecos GCD Minutes for March 19, 2019 Page 14 water-based cuttings, produced sand, and contaminated soil that is on top. Some of the reserve pits being used by the Oil & Gas industry are being dug-up and that material will be brought to our facility. The size of the holes are 17- acres, and there are 7 of them. We use predominately all of the storm water. We have a storm water retention permit by the Railroad Commission, the

Bastiat Liberty & Property Rights Analysis

This motion is scored as RESTRAINS_GOVERNMENT (Impact Weight: 4.6/10). Under the Bastiat Liberty Watchdog Index, voting YES on measures that cap or reduce ad valorem tax burdens, expand taxpayer exemptions, retire debt early, enforce competitive bidding caps, or remove regulatory/zoning barriers to private property rights earns a positive Pro-Liberty score.