STATE OF ALASKA

ALASKA OIL AND GAS CONSERVATION COMMISSION

3001 Porcupine Drive

Anchorage Alaska 99501-3192
Re:THE APPLICATION OF UNOCAL                    )  Conservation Order No. 350
CORPORATION for an order allowing               )
downhole commingling of production              )  Union Oil Corporation
from the McArthur River Field, Trading          )  McArthur River Field
Bay Unit, Middle Kenai "G", Hemlock,            )  Trading Bay Unit
West Foreland, and undefined Jurassic           )  Middle Kenai "G" Oil Pool
Oil Pools, in conformance with the              )  Hemlock Oil Pool
provisions of 20 AAC 25.215(b).                 )  West Foreland Oil Pool
                                                )  Undefined Jurassic Oil Pool
                                                   December 23, 1994
IT APPEARING THAT:

1. By correspondence dated November 21, 1994 Union Oil Corporation (Unocal) requested an order allowing downhole commingling of produced fluids from the Middle Kenai "G", Hemlock, West Foreland, and an undefined Jurassic oil pool within the Trading Bay Unit (TBU) M-32 wellbore.

2. Notice of opportunity for public hearing was published in the Anchorage Daily News on November 30, 1994 pursuant to 20 AAC 25.540.

3. The Commission received no protest or request for hearing regarding the petition.

FINDINGS:

1. Conservation Order No. 234A permits downhole commingling of production from the Middle Kenai "G", Hemlock, and West Foreland oil pools throughout the McArthur River Field.

2. Conservation Order No. 284 permits the commingling of produced fluids from the Middle Kenai "G", West Foreland, and undefined Jurassic oil pools within the TBU M-28 wellbore.

3. Unocal plans to drill the TBU M-32 as horizontal well within a Jurassic interval which is stratigraphically equivalent to that encountered in TBU M-28.

4. Unocal expects the reservoir and production characteristics of the Jurassic interval in TBU M-32 to be similar to TBU M-28. Unocal anticipates a period of high volume unassisted flow followed by a steep production decline in TBU M-32.

5. Unocal will decide to commingle the Jurassic with other oil pools in TBU M-32 based on the well's production history, reservoir characteristics and economic considerations at a future time.

6. Unocal proposes to allocate production from the commingled oil pools through the use of wireline production logging tools.

CONCLUSIONS:

1. In accordance with regulation 20 AAC 25.215, Commission approval is required for commingling of production within the same well bore from two or more pools.

2. Commingling of Jurassic production with that from the Middle Kenai "G", Hemlock and West Foreland Oil Pools in TBU M-32 is expected to ultimately be required to most efficiently exploit Jurassic reserves.

3. Commingling of produced fluids from the referenced pools in the TBU M-32 wellbore may result in recovery of otherwise unproducable hydrocarbons.

4. Commingling of these pools will not promote waste.

5. The commingling of the undefined Jurassic with other oil pools within the TBU M-32 wellbore will have no adverse effect on the correlative rights of any of the interest holders in the well.

NOW, THEREFORE, IT IS ORDERED:

Commingling of produced fluids from the Middle Kenai "G", Hemlock, West Foreland and undefined Jurassic oil pools within the TBU M-32 wellbore is permitted.

DONE at Anchorage, Alaska and dated December 23, 1994.

David W. Johnston, Commissioner
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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