STATE OF ALASKA

ALASKA OIL AND GAS CONSERVATION COMMISSION

3001 Porcupine Drive
Anchorage Alaska 99501-3192
Re:THE APPLICATION OF ARCO                     )  Conservation Order No. 385
ALASKA, INC. for an order granting             )
an exception to spacing requirements of        )
Title 20 AAC 25.055 to provide for the         )  ARCO Alaska, Inc.
drilling of the West Niakuk No. 3              )  West Niakuk No. 3
delineation oil well in the Prudhoe Bay        )
Unit.                                          )
                                                  November 26, 1996
IT APPEARING THAT:

1. ARCO Alaska, Inc. submitted an application dated October 31, 1996 requesting exception to the well spacing provisions of Title 20 AAC 25.055 (3) to allow drilling the ARCO West Niakuk No. 3, delineation oil well to a producing location within 500 feet of a quarter-section line within an undefined oil pool in the Prudhoe Bay Unit on the North Slope.

2. Notice of opportunity for public hearing was published in the Anchorage Daily News on November 2, 1996 pursuant to 20 AAC 25.540.

3. The Commisson recieved one protest to the application, which it rejected because the property interest claimed by the protester was several miles away from the proposed producing location for the West Niakuk No. 3 well.

FINDINGS:

1. The West Niakuk No. 3 delineation oil well will be drilled as a deviated hole with a surface location 1274' from the south line (FSL) and 1088' from the east line (FEL) of Section 36, T12N, R15E, Umiat Meridian (UM) and a proposed producing location 2406' FSL and 662' FEL of Section 22, T12N, R15E, UM.

2. Offset owners BP Exploration (Alaska) Inc., Exxon Corporation and the State of Alaska have been duly notified.

3. An exception to the well spacing provisions of Title 20 AAC 25.055 (3) is necessary to allow the drilling of this well.

CONCLUSION:

Granting a spacing exception to allow drilling of the ARCO West Niakuk No. 3 well will not result in waste nor jeopardize correlative rights.

NOW, THEREFORE, IT IS ORDERED:

ARCO Alaska, Inc.'s application for exception to the well spacing provisions of Title 20 AAC 25.055 (3) for the purpose of drilling the ARCO West Niakuk No. 3 is approved.

DONE at Anchorage, Alaska and dated November 26, 1996.

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

Tuckerman Babcock, Commissioner
Alaska Oil and Gas Conservation Commission

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