STATE OF ALASKA
3001 Porcupine Drive
Anchorage Alaska 99501-3192
Re:THE APPLICATION OF ARCO            )                Conservation Order No. 421
ALASKA, INC. for an order granting          )
an exception to spacing requirements of    )
20 AAC 25.055(a)(3) to provide for the       )                 ARCO Alaska, Inc.
drilling of the KRU 2N-343 development     )                 KRU 2N-343
oil well.                                                  )
                                                                               May 5, 1998
IT APPEARING THAT:

 ARCO Alaska, Inc. submitted an application dated April 14, 1998 requesting exception to the well spacing provisions of 20 AAC 25.055(a)(3) to allow drilling the ARCO KRU 2N-343 development oil well to a producing location that is closer than 500 feet from a quarter-section line.

The Commission published notice of opportunity for public hearing in the Anchorage Daily News on April 19, 1998 pursuant to 20 AAC 25.540.

No protests to the application were received.

FINDINGS:

 The KRU 2N-343 development oil well will be drilled as a deviated hole with a surface location 137' from the north line (FNL) and 1084' from the east line (FEL) of Section 3, T9N, R7E, Umiat Meridian (UM) to a producing location 1,444' FNL and 2,683' FEL of Section 4, T9N, R7W, UM.

 Offset owners BP Exploration (Alaska), Inc., Chevron USA Inc., UNOCAL Alaska Resources, Mobil Oil Corporation and the State of Alaska have been duly notified.

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

CONCLUSION:

Granting a spacing exception to allow drilling of the ARCO KRU 2N-343 development oil 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 20 AAC 25.055 (a)(3) for the purpose of drilling the ARCO KRU 2N-343 gas production well is approved.

DONE at Anchorage, Alaska and dated May 5, 1998.
______________________________________
David W. Johnston, Chairman
Alaska Oil and Gas Conservation Commission
______________________________________
Robert N. Christenson, Commissioner
Alaska Oil and Gas Conservation Commission
_______________________________________
Cammy Oechsli, Commissioner
Alaska Oil and Gas Conservation Commission

Conservation Order No. 421
May 5, 1998

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