STATE OF ALASKA

ALASKA OIL AND GAS CONSERVATION COMMISSION

3001 Porcupine Drive

Anchorage Alaska 99501-3192
Re:THE APPLICATION OF BP               )  Conservation Order No. 366
EXPLORATION (ALASKA) INC.              )
for an order granting an               )
exception to spacing                   )  BP Exploration (Alaska), Inc.
requirements of Conservation           )  Milne Point Unit F-14
Order 205 to provide for               )
the drilling of the BP                 )
Milne Point Unit F-14                  )
development oil well.                  )
                                          December 22, 1995

IT APPEARING THAT:

1. BP Exploration (Alaska), Inc. submitted an application dated December 1, 1995 requesting exception to the well spacing provisions of Conservation Order 205 to allow drilling the BP Milne Point Unit F-14 development oil well to a producing location within the southwest quarter of section 36 T14N R9E Umiat Meridian (UM).

2. Notice of opportunity for public hearing was published in the Anchorage Daily News on December 6, 1995 pursuant to 20 AAC 25.540.

3. No protests to the application were received.

FINDINGS:

1. The BP Milne Point Unit F-14 well as proposed will be a deviated hole drilled from a surface location 1848' from the south line (FSL) and 2838' from the east line (FEL) of Section 6, T13N, R10E, UM to a proposed producing location 2663' FSL and 3578' FEL of Section 36, T14N, R9E, UM.

2. Offset owners Oxy USA, Inc. and Arco Aklaska, Inc. have been duly notified.

3. The proposed producing location for the subject well is in close proximity to the southwest quarter of section 36 T14N R9E UM, which contains the Milne Point Unit F-13 development oil well.

4. An exception to the well spacing provisions of Conservation Order 205 will be required if the BP Milne Point Unit F-14 development oil well is inadvertently drilled to a producing location within the southwest quarter of section 36 T14N R9E UM.

CONCLUSION:

Granting a spacing exception to allow drilling of the BP Milne Point Unit F-14 well to the southwest quarter of section 36, T14N R9E UM will not result in waste nor jeopardize correlative rights.

NOW, THEREFORE, IT IS ORDERED:

BP Exploration (Alaska), Inc.'s application for exception to the well spacing provisions of Conservation Order 205 for the purpose of drilling the Milne Point Unit F-14 well is approved.

DONE at Anchorage, Alaska and dated December 22, 1995.

David W. Johnston, Chairman
Alaska Oil and Gas Conservation Commission

J. David Norton, P.E., Commissioner
Alaska Oil and Gas Conservation Commission

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