STATE OF ALASKA

ALASKA OIL AND GAS CONSERVATION COMMISSION

3001 Porcupine Drive

Anchorage, Alaska 99501-3192
Re:THE APPLICATION of BP                  )  Conservation Order No. 337
EXPLORATION (ALASKA)                      )
INC. for an order granting                )
an exception to spacing                   )  BP Exploration (Alaska), Inc.
requirements of Title                     )  Milne Point C-22
20 AAC 25.055 to provide                  )
for the drilling of the BP Milne          )
Point C-22 development oil well           )
                                             June 6, 1994
IT APPEARING THAT:

1. BP Exploration (Alaska), Inc. submitted an application dated May 17, 1994 requesting exception to 20 AAC 25.055(a)(3) to allow drilling the BP Milne Point C-22 development oil well to a producing location in an undefined oil pool that is closer than 500 feet to a drilling unit boundary.

2. Notice of opportunity for public hearing was published in the Anchorage Daily News on May 19, 1994 pursuant to 20 AAC 25.540.

3. No protests to the application were received.

FINDINGS:

1. The BP Milne Point C-22 well as proposed will be a deviated hole drilled from a surface location 581' from the south line (FSL) and 2054' from the east line (FEL) of Section 10, T13N, R10E, Umiat Meridian (UM) to a proposed bottom-hole location of 2600' FSL and 2930' FEL of Section 23, T13N, R10E, UM.

2. Offset owner OXY USA Inc. has been duly notified.

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

CONCLUSION:

Granting a spacing exception to allow drilling of the BP Milne Point C-22 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 Milne Point C-22 well is approved as proposed.

DONE at Anchorage, Alaska and dated June 6, 1994.

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

Russell A. Douglass, Commissioner
Alaska Oil and Gas Conservation Commission

Tuckerman Babcock, Commissioner
Alaska Oil and Gas Conservation Commission

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