Re: THE APPLICATION OF BP                   ) Conservation Order No. 401
    EXPLORATION (ALASKA)
    INC. for an order granting an exception
    to spacing requirements of Title
    20 AAC 25.055 to provide for the
    drilling of the BP Niakuk 39
    exploration oil well.
                                                                 August 18, 1997
IT APPEARING THAT:

1. BP Exploration (Alaska), Inc. (BPX) submitted an
   application dated July 29, 1997, requesting exception to
   20 AAC 25.055(a)(1) to allow drilling the BP Niakuk 39
   exploration oil well to a location in an undefined Pool
   within the Sag River and Ivishak Formations that is
   closer than 500 feet to a quarter section line.

2. Notice of opportunity for public hearing was published
   in the Anchorage Daily News on August 1, 1997, pursuant
   to 20 AAC 25.540.

3. No protests to the application were received.

FINDINGS:

1. The BP Niakuk 39 well as proposed will be a deviated
   hole drilled from a surface location 1426' from the
   south line and 827' from the east line of Section 36,
   T12N, R15E, Umiat Meridian (UM) and the proposed
   bottomhole location is 2200' from the north line and
   2200' from the east line of Section 30, T12N, R16E UM.

2. BPX is the sole owner and operator of all offsetting
   spacing units.

3. An exception to 20 AAC 25.055(a)(1) is necessary to
   allow drilling of this well.

CONCLUSION:

Granting a spacing exception to allow drilling of the
BP Niakuk 39 well as proposed will not result in waste
nor jeopardize correlative rights.

NOW, THEREFORE, IT IS ORDERED:

BP Exploration (Alaska), Inc.'s application for exception
to 20 AAC 25.055 for the purpose of drilling the Niakuk 39
well is approved as proposed.

DONE at Anchorage, Alaska and dated August 18, 1997.

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

______________________________________
Robert N. Christenson, P.E., Commissioner
Alaska Oil and Gas Conservation Commission

Conservation Order No. 401
August 18, 1997