Alaska Oil and Gas Conservation Commisssion - Conservation Order No. 452.002

STATE OF ALASKA

ALASKA OIL AND GAS CONSERVATION COMMISSION

333 West Seventh Avenue, Suite 100

Anchorage Alaska 99501

ADMINISTRATIVE ACTION NO. 457A.02
ADMINISTRATIVE ACTION NO. 471.02
ADMINISTRATIVE ACTION NO. 484.02
ADMINISTRATIVE ACTION NO 452.02

Mr. Gil Beuhler
PBU Satellite Engineering Manager
BP Exploration (Alaska) Inc.
P. 0. Box 196612
Anchorage, AK 99519-6612

Re: PBU Western Satellite Production Metering Plan
Amendment of Conservation Orders 457A, 471, 484, and 452

Dear Mr. Beuhler:

By letter dated April 23, 2002, BPXA requested approval of the Prudhoe Bay Unit Western Operating Metering Plan for allocation of production from satellite oil pools in the Western region of the Prudhoe Bay Unit. The Commission conditionally approved this plan for one year beginning August 1, 2002. Rule 4 of Conservation Order No. 471 for the Borealis Oil Pool, Conservation Order No. 457A for the Aurora Oil Pool, and Conservation Order No. 484 for the Polaris Oil Pool addresses the metering and allocation of production under this plan. Continued authorization of metering and allocation procedures was to be determined at a hearing to be scheduled no later than July 31, 2003.

BPXA provided the Commission with a detailed metering and allocation procedures document on August 1, 2002. BPXA provided the Commission with a thorough review of the allocation performance of the Prudhoe Bay Unit Western Operating Metering Plan at technical meetings held on May 22 and June 5, 2003. In addition, well test and allocation information of all production fluids within the GC1 and GC2 areas were provided as required.

The Commission finds that continued use of the Prudhoe Bay Unit Western Operating Metering Plan is appropriate and that a further hearing is unnecessary. In addition, the Commission finds that technical process review meetings, required by the Commission to take place quarterly, need only take place annually. Accordingly, the Conservation Orders 471, 457, 484, and 452 are amended as follows.

Borealis Oil Pool (CO 471), Aurora Oil Pool (CO 457A) and Polaris Oil Pool (CO 484)
Rule 4 of Conservation Orders Nos. 471, 457A, and 484 is amended to provide that approval of the Prudhoe Bay Unit Western Operating Metering Plan is permanent. Rule 4 of Conservation Orders Nos. 471, 457A, and 484 is amended to require technical process review meetings to be held at least annually.

Midnight Sun Oil Pool (CO 452)
Rule 7 of Conservation Order No 452 (“CO 452”), approved November 15, 2000, requires revision to conform to the allocation procedures of the approved Prudhoe Bay Unit Western Operating Metering Plan, and is amended as follows:

CO 452 - Rule 7 Common Production Facilities and Surface Commingling

a. Production from the Midnight Sun Oil Pool may be commingled with production from Prudhoe Bay, and other oil pools located in the Prudhoe Bay Unit in surface facilities prior to custody transfer.
b. The Prudhoe Bay Unit Western Operating Metering Plan, described in the letter dated April 23, 2002 and detailed within the “Prudhoe Bay Unit (PBU) Western Satellite Production Metering Plan – Policies and Procedures Document” dated August 1, 2002 is approved for allocation of production from Midnight Sun Wells.
c. All Midnight Sun wells must use the Gathering Center 1 well allocation factor for oil, gas, and water.
d. All wells must be tested a minimum of once per month. All new Midnight Sun wells must be tested a minimum of two times per month during the first three months of production. The Commission may require more frequent or longer tests if the allocation quality deteriorates.
e. Technical process review meetings shall be held at least annually.
f. The operator shall submit a monthly report and file(s) containing daily allocation data and daily test data for agency surveillance and evaluation.

DATED at Anchorage, Alaska, nunc pro tunc August 11, 2003.

Sarah Palin
Chair

Randy Ruedrich
Commissioner

BY ORDER OF THE COMMISSION DATED August 19, 2003


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