**Overview of the National Oil and Gas I&E Strategy for FY97**

**Course 3000-43**

**BLM National Training Center Telecast**

**September 26, 1996**

This transcript is from the closed-captioning file produced during the
telecast.

It may contain errors in transcription and omissions.

Good Morning, Everyone, and Welcome to the BLM National Training Center.
We\'re Happy to

Bring You Today\'s Telecast, Which Is the Overview Of the National Oil
and Gas I&E Strategy

and the Fiscal Year 1997 Matrix Preparation. Our Instructors Today Are
Don Henrichsen,

District Manager From Casper, Wyoming. Glad You Could Take Time from
Your Busy Schedule to Be with Us Today, Don.

Thanks, Paul. It\'s a Privilege to Be Here.

We Also Have with Us Today Lonny Bagley, the Washington Office I&E
Specialist Stationed In Billings, Montana. Most of You Involved in the
I&E Program Know Lonny or at Least Have

Heard His Name. Welcome to the Show, Lonny.

Glad to Be Here, Paul.

Glad You Could Be Aboard. Howard Lemm, the Chief Branch of Fluid
Minerals Will Be Joining Us a Little Later in the Program. Our Special
Guest Speaker this Morning Is Hord Tipton, Assistant Director for
Resource Use and Protection. At Least We Think That\'s His Title at the
Moment Pending Further Organizational Changes. Hord Will Not Be Able to
Join Us In Person So We Have Enlisted The Help of Technology to Bring
Him to Us Live via Satellite From Washington. Before We Get to Hord,
Let\'s Go Over a Few Items about the Course Today. Hord, Good Morning.
Welcome to the Show.

Good Morning. Glad to Be Here.

So, We Want You to Participate as Much as Possible During the Telecast.
Participation Can Be

by Phone or By Fax. First of All, Let\'s Talk about Phone Calls. You May
Call in and Ask

Questions Regarding the Subject Matter Being Discussed at Any Time on
the Air Using the

Phone Number Provided in Your Viewer Packet. Keep in Mind That There
Will Also Be Two

Formal Question and Answer Periods During the Telecast for General
Questions. We Will Ask

for Your Calls Before the Question and Answer Periods to Give You Plenty
of Time to Get in

Touch with Us. Those of You Who Call in Will Be Given First Priority.
Please Try to Schedule

Your Specific Call‑in Questions as Soon as Possible after the Topic Has
Been Discussed by the

Instructors. Now, You May Also Fax Questions At Any Time by Using the
Form in The Back of

Your Viewer Packet. Be Sure to Print Your Questions Legibly with a Dark
Marker. We Would

Also like You to Provide Us with a Phone Number On the Fax in Case We
Need to Get in Touch

with You to Clarify Your Question or If We Have Difficulty Reading It.
Well, with That Said,

We\'re All Ready to Get Started this Morning. So Let\'s Kick Things off
Now by Joining Hord

Tipton via Satellite from the Main Interior Building in Washington. How
Is Everything in

Washington This Morning, or Should I Say This Afternoon, Hord?

It\'s as Crazy as Usual.

Are You Thoroughly Reorganized?

Well, We Are Planning on Being in Our Newly Washington Reorganized
Structure next

Tuesday, October 1st. Everything Seems to Be on Schedule. Let Me Start
by Welcoming

Everyone to What\'s Been Described to Me as Double Live. It\'s a First
for Us, at Least, In this

Type of Technology, and It\'s Something That We\'re Going To Have to Be
Using a Lot More Of

in the Future. So I\'m Just Very, Very Pleased To Be Able to Participate
with You this Morning

and Get Things Started. I\'d like to Begin to ‑‑ by Thanking All of the
Folks Who Have Put Time

and Effort into Putting this Together. I Understand We Also Have a
Widespread National

Participation Today. From the National Training Center We Have Our
Petroleum Engineers and

Technicians and Some State and Some Tribal Folks As Well. So I Say to
All of You at this Point,

Welcome! Let Me Just Briefly Give a Little History and Background of Our
Program and of

Myself. I\'ve Been with the BLM Now for a Little over Two and a Half
Years And Still Consider

Myself a Newcomer to the Bureau. I Have Been Learning the Oil and Gas
Business Quite Rapidly over That Time and Have Been Quite Impressed by
the Program, the Folks Who Administer the Program, and the History and
the Scrutiny That the Program Has Been under. As Many of You Long‑time
BLM Folks and Others Know, this Program Seems to Get Annual Reviews by
Our Inspector Generals, the Congress, Internal Reviews and Others and
the Public. There Is a History and Many Reasons for Why this Is So. But
to Me, it Just Points out What an Important Program it Is. We\'ve Had
Lots of Back and Forthwith the Investigative Agencies, the Reviewing
Agencies And Have Made, Even During My Short Tenure, What I Consider a
Lot of Enhancements, Improvements in the Program and I Am Pleased to
Report Today That We Have No Outstanding

Issues, Unresolved Issues with Those Type of Agencies, and That Is Due
Primarily to the Hard

Work and the Dedication of All The Employees out There in the Field. The
Reason this Program

Gets So Much Scrutiny, in My Mind, Is Because of the Value Behind it And
Just the Importance

of Public Resources. All of Us Spend a Lot of Time in Trying to Take
Care and Manage The

Public Resources in the Best Way That We Know How with the Resources and
the Materials

That Are Provided for Us. We Take Great Pride in BLM in Trying to Get
the Word out as

Broadly

as We Can Just How Much Value the Minerals Programs Particularly Play to
Not Only BLM but

to the Public, the Treasury, the States, Local Communities, and It\'s
over \$500 Million a Year Just

in Royalty And Bonus Collections Alone. When You Consider the Actual Tax
And the Local

Benefits That Come From That in Terms of Jobs, Then You Can See Why
People Are So

Concerned That We Administer the Program Properly. Let Me Talk a Moment
about Budgets.

We\'re Fortunate in a Way That it Looks like We\'re Going to Be Able to
Reserve Our Base in the

Budget Program. I Doubt If Anyone out There Thinks That We\'re Going to
Get More Money for

Budgets. We\'re Pleased to at Least Maintain and Protect and to Avoid
Cuts Any Worse than They

Have Been. We All Have to Find New Ways of Doing Our Business as a
Result Of this. Today Is

a Good Example of How To Make Our Budget Dollars Go Further. Satellite
Training Is a New

Initiative for the Coming Year, And in Great Regard, We\'re Probably a
Continuing Test and Pilot

of Just How this Works. I Will Be Particularly Interested in Any
Comments, Thoughts That Any

of You out There Might Have about the Effectiveness of this Type of
Training and Overviews.

Many of You Have Been Working With Us on New Rules Involving The Oil and
Gas Program

That Are Due to Come out in Proposed Form Next Tuesday, October 1st, and
If Not October

1st, Shortly Thereafter. There Will Be Lots of Questions On These. You
Will See Lots of

Changes in These Rules. For One Thing, They\'re in Plain English, Which
Will Take Some

Explaining to Our Public as Well. We Are Depending on All of Our Oil and
Gas People to

Communicate, Explain What These Rules Are, How They\'re Going to Work.
At the Same Time,

New Rules Means New Need for Training and Just General Getting the Word
Out. So We Will

Be Applying this Type Of Technology Even More Extensively. Let Me Talk a
Minute about the

Managers Participation. I Understand That We Do Have a Number of Program
Managers

Participating Today. Oil and Gas Is Pleased to Be Part of the Broad
Agenda. My Role from

Washington Is ‑‑ Has One Great Requirement in Assuring That All of Our
Programs Fit Together

and Our Managers in the Field Are the Ones Who Have to Make this Happen
on the Ground. So

I\'m Very Pleased That We Have Active, Broad Management‑type
Participation. I Want to Say

Just a Word about The Oversight of Our Programs. Everyone Has to Play a
Role in This. With

Reduced Budgets, Reduced People, We Really Don\'t Have the Ability to
Look over Each Other\'s

Shoulders Anymore. We Have to Train Our People to The Best Degree That
We Can. We Have

to Empower Those Folks To Do the Jobs That They\'re Paid To Do. And Then
We Have to

Provide Good Direction to You to Carry out. I Feel Very Comfortable in
Doing This. I\'ve Spent a

Lot of Time in the Field Talking to Folks and Learning These Programs
and Just Generally

Getting to Know You. So I Think We\'re at a Time to Enter a New Era.
It\'s an Exciting Era. And

It\'s a Point in Time That We Just Have to Look at How We Do Our
Business Better. I Hope That

Today Is a Point in That Time Where We Review Our Strategic Plan, We
Revisit How We Do

Business, Both on the Ground, from Inspection, Monitoring and Planning,
and Move Forward

from There. I Could Talk at Length on the Strategic Plan, but I Think
That\'s Probably Going to

Be More Of a Subject of What the Training Is Today. Do I Need to Say
More? All of You Have

to Understand I\'m Looking at a Blank Television Here. I Don\'t See Any
Wincing or Screaming

from Anyone.

Hord, I Have a Question for You. This Is Lonny Bagley. In the Policy and
Guidance Group That

We Just Established, Could You Touch on What Their Role Is Going to Be
in Providing

Feedback to You from the Washington Office?

Again, We Have a Number of Groups That Are Looking at Our Business
Practices Right Now.

This Is All Part of Doing Business in a Better Way. One of the Things We
Have to Do Is to Kind

of Start from the Ground on Our Strategy, and I Guess I Would Begin by
Setting Our Goals for

the Inspection Accomplishments. We Know We Can\'t Do as Much as We Would
like. We Have

to Look at What\'s Available to Us and Where That Resource Is Available
and Try to Match the

Work and the Need Around That. I Know That\'s Not an Ideal Way To Do
Business, But,

Frankly, It\'s Reality. This Drives Us to What I Would Call a
Prioritization of Inspections. We

Have to Look at Our Work, Make Sure the Inspections We Do Are the Most
Important Ones,

and Give Us the Best Protection. I Would Look at the Use of the
Inspection Plan Matrix as a

Budget and a Workload Planning Tool. We Need to Know from You What Your
Real Needs

Are. Often We Don\'t Get What We Ask For, But, Frankly, If You Don\'t
Ask, We Don\'t Know,

and Therefore, You Don\'t Get It. We Do Need to Keep an Eye to the
Program Oversight and

General Management of That Program. The Empowerment Is Good, and Like I
Say, We Are Not

Going to Be Looking over Each Other\'s Shoulders, but We Have to Look
Out for Each Other,

and I Think Oversight Is Probably a Strong Word for That, but as All of
You Know, it Only

Takes One Foul‑up, One Mistake for Things to Occur And Publicity and
Reviews of Our Program

That Have Been Unfortunate in the past. So We Need to Keep That in the
Back of Our Minds.

We Need Good Documentation of Our Inspections. I\'m Pleased to Report
That We\'ve Been Able

to Accelerate Our Plans for the Fma System That Many of You Have Been
Working With Us

over the past Couple of Years to Try to Get on Line. This Again Is a Way
That I\'m Hopeful Can

Help Us Join the 21st Century in Going into What We Call the Electronic
Commerce End of the

Business, Being More Interactive with States, Tribes And with Our
Industries to Get Information

Faster to Make Our Decisions Faster and Have Better Control in
Management of What Happens

There. Enforcement Actions\... There\'s Always Going to Be a Need for
Enforcement Actions. It\'s

Just Part of Our Overall Strategy. Interdisciplinary Program
Coordination. I Know These Are a

Lot of 50‑cent Words, but They\'re Still With Us. It\'s More Important
than Ever to Coordinate

Programs. A Lot of Times We\'ve Probably Operated Independent, Used
Information That We

Could Have Probably Gotten Somewhere Else To Do Our Business, but If We
Can Make Life

Easier by Working Together, Then Now\'s the Time to Do That. By Having
Fewer People, by

Vesting More Authority in the Field, We Need to Adhere to Good, Solid
Training and

Certification Requirements. As I Say, Today Is a Part of Meeting Those
Type of Requirements.

That\'s about All I Can Think of Off the Top of My Head, Lonny. Would
You Want to Add

Anything To That?

I Think You\'ve Covered Everything Pretty Well There, Hord.

Thank You for Joining Us this Morning, Hord, We Appreciate Your
Thoughts.

Well, It\'s Been Enlightening For Me, and I\'m Just Pleased to Be Part
of Interactive Television

and Double‑live Technology. So Good Luck to You on the Rest Of the
Program, and as I Say

Again, Thanks to All of You for Putting this Together.

Thank You Again, Hord.

See You, Hord.

I\'d Be Surprised If We Don\'t See More of Hord on Tv Now That We Know
That this Works.

We\'ll Now Go to Don Who Is Going To Discuss the Purpose of Inspections,
the Federal Oil and

Gas Royalty Management Act, Also Known as the Fogrma, and Program
Implementation. Don,

Are You Ready to Get Started?

Yes, I Am. Thanks, Paul. Good Morning, Everybody. This Segment Will
Begin with Course

Objectives, Guide Guidance and Procedures, Purpose Of Inspections, the
Fogrma Mandates That

Paul Just Referred To and Program Implementation. Before I Begin, I
Would like to Show You

One of the Pieces of Equipment Both Lonny and I Will Be Using Today.
This Is, as You See on

Your Slide There, this Is Elmo. Elmo Is a Graphics Camera That We\'ll Be
Using Today. It

Essentially Is a Video Overhead Projector. Please Follow along with Your
Video Packet as I

Present These Slides. The Objectives for this Morning, The Participants
Will Have Basic

Understanding of Types of Inspections to Be Conducted, How Inspections
Are Prioritized, How

Inspection Goals Are Set and the Frequency of Inspections, and The
Development of Inspection

Plan Matrix. The I&E Strategy Contains Guidance and Procedures for the
Implementation

Including: Setting of Consistent Inspection Accomplishment Goals, the
Prioritization of

Inspections, And the Use of the Inspection Plan Matrix as a Budget and
Workload Planning Tool.

Also, Program Oversight and Management, Documentation of Inspections,
Enforcement Actions.

Interdisciplinary Program Coordination, Training and Certification
Requirements, Workhour

Tools and Program Support Requirements. The Purpose of the National Oil
And Gas Inspection

and Enforcement Strategy Is to Establish the Bureau Policy for Effective
and Efficient Utilization

of Personnel Resources to Fulfill BLM\'s Responsibility and Mandates for
The Protection of the

Federal And Indian Mineral Interests, Protection of Surface and
Subsurface Environment, Proper

Accounting of Production, Protection of Public Health and Safety,
Conservation of Resources

with Regard to Oil and Gas Activities on Federal and Indian Lands.
Fogrma Mandates the

Following: The I&E Strategy Ensures Orderly And Consistent
Implementation of Specific

Elements of the Secretary\'s Responsibilities for Proper Accountability
of Oil and Gas Production

Identified in the Federal Oil and Gas Royalty Management Act of 1982,
Section 101 (B) (O) and

\(2\) and Section 108 (B). The Secretary Shall Establish Procedures to
Ensure That Authorizing

Properly Identified Representatives of the Secretary Will Inspect at
Least Once Annually Each

Lease Producing or Expected to Produce Significant Quantities of Oil and
Gas in Any Year or

Which Has a History of Noncompliance with Applicable Provisions of Law
or Regulations; And,

Two, Establish And Maintain Adequate Program Providing for the Training
of All Such

Authorized Representatives in Methods and Techniques of Inspection and
Accounting That Will

Be Used in The Implementation of this Act. Section 108 (B), the
Secretary Shall Develop

Guidelines Setting Forth the Coverage and Frequency Of Such Inspections.

Don, How Does this Relate to Conducting Our Inspections Now? How Does
That Fit into the

I&E Program?

Well, Right Now the Way it Fits into the Program Is That We Have the
Guidance That Tells Us

How to Set Our Priorities. We Have Guidance to Tell Us What The Statute
Requirements Are.

And I Think the Best Way to Respond to That Is That We Have Sufficient
Information in Place.

We Have the People Trained in Place. And We Are Clearly Meeting the
Mandates as Stated in the

Fogrma Act Right Now. Program Implementation: the Inspection Plan
Matrices Summarize

Inspection Work Loads, Available Staffing, Projected Inspection
Accomplishments and

Additional Staffing Needs of an Inspection Office. The Matrix Is
Submitted as Part Of the Budget

Package Each Year To Justify Workmonths and Positions. Hord Just
Mentioned That. And as We

All Relate to the Preliminary Annual Work Plan and The Work Plan
Process, It\'s Extremely

Important to Have Good Information and Documentation as To the Needs and
What Priorities

We\'ve Set Forth in Terms of Our Accomplishments for the Preceding ‑‑
for the Forthcoming

Year. Mid‑year Review ‑‑ It\'s Hard to Base this Last Year in Terms of
How and What We\'re

Going to Be Doing, but on Occasion There Are Shifts in Either ‑‑ Not So
Much In Priorities but

Shifts in Fundings That May Be Able to Benefit Us Either in Terms of
Overtime or What Have

You. So the Mid‑year Review Is Also An Important Aspect of this Process.
With That ‑‑ Do You

Have a Question, Lonny.

Speaking of Mid‑year Review, We Talk about How Inspection Plan Matrices
Are Revised and Is

Mid‑year the Only Time We Can Revise a Matrix?

No and I Will Speak to it Later. The Planning and Process We\'re Going
Through Is Really a

Scheduling Process to Meet Our Priorities, but in Many Cases, If There
Is New Drilling or

Plugging and Abandonment Going On out There, We Have to Adjust Our
Priorities and We Have

to Make Adjustments for the Activities in the Field. So Our First
Priority Is Going To Be to Take

Care of Those Activities on the Ground Such as Plugging and Abandonment
or New Drilling, and

Then We Have to Go Back and Adjust Our Plan Accordingly.

in Other Words, We Can Adjust That at Any Time We Feel It\'s Necessary.

Yes, but We Do Need to Maintain the Documentation So That We Can Make
Both Our Own

Offices, and Particularly the Washington Offices, Aware of What Caused
Those Changes.

Okay. Thanks.

this Concludes My Portion of The Presentation. Now We\'ll Return to
Paul.

Thanks, Don. In a Few Moments We\'re Going to Hear from Lonny. He Will
Be Talking with Us

about Oil and Gas Inspection Types and Activities. But Before We Get to
That, Though, Let Me

Say a Little More About Phone Calls During the Telecast. When You Call
Us at the Number

Listed in Your Viewer\'s Packet, We Ask That You Stand Away from Your
Television and Turn

down The Sound So That We Don\'t Get Feedback on the Air. Don\'t Get
Frustrated If You End

Up on Hold for a Few Moments. Our Phone Operators Will Respond To Your
Call as Soon as

They Can. We Will Then Place Your Calls on Air as Quickly as Possible.
Don\'t Be Shy about

Calling In, Folks F We Can Sit up Here on Live Tv, We Expect You to Be
Able to Pick up the

Phone on Your End. This Training Will Be More Effective with Audience
Participation. Also, If

You\'re Afraid about Missing Something While You\'re Calling In, Don\'t
Worry about That. Once

Your Call Has Been Taken And You\'re on Hold, You\'ll Be Able to Hear
What\'s Happening on

Air. To Help Your Office Participate In Future Satellite Training
Courses, See the BLM Satellite

Downlink Guide or Visit the NTC Home Page on the World Wide Web. Our
Temporary Address

Is www.starlink.com/\~ntc: Transcripts of this Course and Other NTC
Broadcasts Are Available

on the Home Page. You May Follow along with Today\'s Presentation by
Referring to Your

Viewer Packet. The Instructors Will Point out Specific Page Numbers as
They\'re Required. Now,

in Your Viewer Packet There Is a Copy of a Course Roster That Should Be
Filled out by Each of

You. Please Give the Roster Back to Your On‑site Coordinator after The
Broadcast. We Would

like the Roster Sent Back to Me at NTC So That We Can Determine the
Number of Viewers Of

the Course. Joining Us Now Is Howard Lemm. Howard Is Here to Assist Us
in Answering Your

Questions and Generally Providing Us with More Expertise Regarding the
I&E Program.

Howard, Thanks for Being with Us Today. I Would like to Have Your
Perspective on the

Strategy Training.

Thanks, Paul. It\'s Great to Be Here. This Has Been a Lot of Fun this
Week, and We\'ve Learned

a Lot About All this Television Stuff, And for People like Fred out
There in Casper and Bill in

Dickenson and John in Mile City And All Those Guys, One of the
Highlights Is Watching These

Two Real Good‑looking Ladies Trying To Make Lonny Bagley Look Good In
Make‑up. They

Didn\'t Have Much to Work With, but They Didn\'t Have Much To Work with
Any of Us. That

Was One of the Highlights We Have Had Here Working on this Thing. But,
You Know, I Think

this Thing Has Got a Lot of Potential For the Future as Well, and What I
like about this Is

Everybody Gets to Have a Refresher on the Strategy Preparation, Which Is
Something They

Wouldn\'t Do Otherwise Unless They Went to The I&E Production Course.
Probably More

Importantly than That, What I Think Is Significant about What We\'re
Doing Here Is it Gives the

Field Offices a Chance to Give Us Input Through the Faxes and the Phone
Calls to What Is Still a

Draft \'97 Strategy Document. So Probably Never Before Have We Had That
Opportunity Where

Anybody in the Field Office Can Provide Their Input and Questions and
Suggestions Towards

That Strategy. The Other Thing I Will Be Doing Today, I Get to Heparin
the Phones, and That

Ought to Be Fun. I Hope We Have a Lot of Phone Calls and Faxes in Here.
That\'s Going to

Make this Thing ‑‑ That Feedback from Our Field Offices. It\'s Good to
Be Here, Paul.

Thank You, Howard. Let\'s Phone in Your Questions or Fax in Your
Questions. They\'re

Extremely Important to Not Only this Program but to the Entire National
Program. Now Let\'s

Turn Our Attention to Lonny Who Will Explain the Different Inspection
Types Required under

Bureau Policy. Lonny?

Thanks, Paul. I Would like to Point Out, Howard Made the Statement about
Me Needing a Lot

of Make‑up. Howard Was in There All the Way Through Don Getting Made up
and All the Way

Through Me Getting Made up and Halfway Through Paul Being Made up Before
They Even Let

Him out of There. As You Can Tell, He\'s Got a Lot To Cover up There.
Moving on Now, We

Will Go Through the Different Types of Inspections That We Conduct in
Doing Our Work and

Briefly Explain Those and Most of You Know What Types of Inspections Are
Conducted, but

this Will Be A Little Refresher, a Build‑in Into the Aspect of Your I&E
Strategy and What You

Can Accomplish and What You Want to Accomplish. Moving Now over into the
Drilling

Inspections, There Are Drilling Inspections Are Conducted to Ensure That
Equipment and

Procedures and Practices Are in Accordance with The Minimum Standards of
On‑shore Orders 2

and 6 and in Accordance with the Apd. There Are Two Main Types of
Inspections That We Do in

Accordance with Conducting Drilling Inspections and They Are the
Nondetailed Inspection,

Which Is an Inspection of Ongoing Operations of a Drilling Well and
Requires the Completion Of

All Applicable Sections of Form 3160‑10. We Also Have the Nondetailed
Inspections, Which Is

an Inspection Done for the Completion of the First Two Sections of
3160‑10, Which Is The

Requirements for Making Sure Your Approval Documents Are on Site and
Also the

Environmental Side of What the Operations Are Doing out There. Any Other
Applicable Section

of That Particular Form That You Are Conducting. The next Type of
Inspection Are Production

Inspections, and They Are Inspected to Ensure That Operations and
Equipment and Procedures

Are in Accordance With the Regulations, of Course, Minimum Standards of
On‑shore Orders 3,

4, 5 and 6, and Any Applicable Approval Document That May Be out There.
There Are Two

Main Different Types of Production Inspections. They Are the Detailed
Production

Accountability Inspection in Which We Will Discuss Quite Lengthy Here
Once We Get into

Developing Your Matrix and How That Is to Be Performed. That Is the
Intent of a Dpai Is To

Ensure Production Accountability and Review of All Applicable Items out
There. Independent

Measurement Handling Inspections or Imhis Are Inspection Conducted for a
Particular

Measurement Activity And Site Security Tea. The Intent Is to Highlight
and Emphasize

Importance of Actions Assuring Production Accountability. The
Requirements for an Imhi, This

Fiscal Year, Anyway, There Are Two Sets of Requirements Basically Set
out to Follow the

Requirements under Im 94‑17 and Also There Were Some Draft Requirements
That We Sent out

to Conduct Inspections in a More Detailed Way under the Imhi Process,
and They Include a

Representative Sampling of Measurement Activities, Partial Records
Review, Which Was Mainly

Review of the Mro, Make Sure That Things Were Being Properly Reported,
Look for Trends in

Misreporting and So On. It Also Involved the Category of Environmental
Activities as That

General Aspect of Looking for Erosion and Spills and Things in That
Regard. Then Also Include

a Site Security Inspection Activity on All Imhis. So it Was Quite a Bit
More Activities Being

Conducted on That Particular Inspection than In the Past, and We\'re
Currently Trying to Review

Those and See What the Benefits of Those Types Of Inspections Were.

Lonny, I Have a Question for You That We Have Gotten over Fax. How Do We
Code a

Production Session That Started out as a Ph But Changed to a Pa Based on
a Problem We Found.

Getting a Little Clarification Also on What\'s a Ph and Pa, That\'s the
Coding in The Automatic

Inspection Record System. Pa Stands for Dpai, and the Ph Is for the
Imhi. But in Instances Where

You Have Run into Inspecting the Lease And Everything Shut in on That
Particular Lease, We

Would like To See Those Coded Mainly as a Ph Inspection or Imhi Because
Basically You Are

Looking at What Is Occurring on the Lease And Whether or Not You Have
Production, Whether

They Are Misreporting That Production and Look at the Environmental
Aspects, If There Are

Any Spills, and Ensure That Things Are Operating Properly. And Also
Checking the Status of

That Particular Well or Lease.

Okay. We\'ve Got Some Other Questions But We\'ll Wait until Further in
Your Presentation on

Those.

Okay. Thanks. Keep Those Questions Coming into Us, and We\'ll Make Sure
and Get To Those

for You. The next Type of Inspections We Do Are Environmental
Inspections. These Are

Typically Performed by Your Nrs or Environmental Scientist Type People
or a Particular

Resource Program Specialist. Environmental Inspections Are Conducted to
‑‑ Are Conducted

Mainly on Reclamation Work, Topsoil Stockpiling, the Location of the
Roads, the Pit And Pit

Construction and Use, Erosion Concerns. The Also Inspections of Spills,
Salt Water Disposal

Methods, Tank Battery Dikes and Other Hazards May Also Be Part of this
Type of Inspection,

but I Want To Clarify this Particular Inspection Is Done by Your
Environmental Scientists, and

These Are Specific Items That They Are Looking At, and it Also Will
Include Items That Are in

The Post‑approval for Specific Environmental Impacts That Are Out There.
The next Type of

Inspection That We Perform Are the Workover Type Inspections and These
Inspections Are

Done to Ensure The Equipment and Your Procedures Are Done in Accordance
with the Approval

Document by the Engineer. These Inspections Are Optional At this Time
and Probably Will

Remain Optional until Further Notice. We Don\'t Have Any Requirements
Nationwide for

Conducting These Inspections. The next Type of Inspection Is The
Plugging Operations. These

Operations Are Inspected To Ensure That Equipment and Procedures and
Practices, of Course,

Are Within the Requirements of On‑shore Order Number 2. The Approve ‑‑
and Approve Notice

to Abandon. There Are Two Different Types of Plugging Inspections That
We Look At, and

They Are the Plugging of a Depleted Producer, Which We Document in the
Automated

Inspection Record System Separately. And the Plugging of a Dry Hole.
Moving on into the

Undesirable Event Inspections, These Inspections Are Related to Those In
Association with Ntla

3a and Arrange for Inspections of Spills, Fires, Accidents or Deaths and
Other Emergency

Venting. Then We\'ll Move on into the Record Verification Inspections.
These Are Typically Done

by Individuals in Your Particular Office, Either by Your Minerals Clerks
or Even Pets Themselves

But They Relate to Inspections Of Files That Are Not Related to
Conducting a Dpai or Imhi and

Are Recorded as Such in Your Monthly ‑‑ in Your Database. They Also Will
Revolve Around

Conducting Inspections of Approval Reports, Run Tickets, Making Sure the
Volumes Are

Calculated Properly and Verifying That Against the Monthly Report of
Operations. That

Concludes the Type of Inspections We Have, Paul. Are There Any Other
Questions?

Thank You, Lonny. Yes, We Did Get a Fax In. Howard, Do You Want to
Transmit That?

Yes, We Got a Couple Questions Here. What Do We Call an Inspection of \[
Inaudible \]

I Answered That a Little Bit Before, Paul ‑‑ I\'m Sorry, Howard. Don\'t
Want to Insult You There

Too Much. But If You\'re Looking at Conducting an Independent
Measurement Handling

Inspection And All Your Leases Then Are ‑‑ All of Your Wells Are Shut
In, They Got Facilities,

You Need to Still Go Ahead and Conduct an Independent Measurement
Handling Inspection and

Code it as Such In the Database, and That Way You\'re Looking at What Is
Going On out There

in Production Related Aspect, Checking for the Status, and Checking for
Site Security, Any Spills

and So on And So Forth.

Okay. We Got a Question from John Here. Does Inspection Priority Ranking
Relate to Setting

Frequency of Inspections Other than High Fogrma?

Could You Repeat That.

Does Inspection Priority Ranking Relate to Setting Frequency of
Inspections?

No, They Don\'t. The Priority Rating for an Inspection Is Based on Your
Fogrma Criteria. It Is

Based On, of Course, Your Environmental Aspects, Your Health and Safety.
The Frequency of

Inspections Are Based on What an Office Feels That They Can ‑‑ How Often
They Want to

Inspect That Particular Lease. So It\'s Two Different Issues, And People
Need to Keep Those

Separate.

Kind of a Follow‑up to That: Should Frequency of Inspections Be Set at
Minimum Goals and

Office Encourage to Exceed the Frequencies Other than High Fogrma.

We Would like to See All Our Offices Exceed the Minimum Requirements If
They Can. It\'s Not

‑‑ the Goal Set by the Washington Office Are Only Goes, And If People
Can Exceed Those

Particular Goals, We Would like To See That and More Frequently Inspect
Leases.

Okay.

We Have a Fax Coming In. It Should Be with Us in Just a Second.

Okay. This Question: Do We Have Authority to Do an Environmental
Inspections on Split

Estate or Fee and State Leases and Federal Units.

the Environmental Responsibility for Our Inspection Staff on Split
Estate And Other Service

Management Agencies Is That We Let Those People Handle Those. Sometimes
a Split Estate

You May Have Issues That Come up When You\'re out There Doing
Inspections, and If There Is

a Problem That You Find, Then You Need to Contact the Appropriate
Service Managing Agency

and If It\'s on Private That Would Probably Be Your State Oil and Gas
Commissions or Someone

like That. But Don\'t Leave Those Issues Go By Just Thinking Somebody
Else Is Going to Take

Care of it Because We Have ‑‑ We Have a Responsibility That We Should
Take Some Action and

Let the Appropriate Management Office Know about That.

I Think the Position Most States Have Taken Is That in Terms of a
Royalty or a Measurement

Situation, Then We Have a Clear Jurisdiction, but For Environmental
Problems on Those Fee and

Split Estate, We Let the Other Service Agencies Handle Those Situations.

That Is Correct.

Lonny, How Many Inspections Are Needed for Drilling Operations Normally?

the Number of Inspections Needed Would Depend upon What Activities Are
Going On, and it

Will Depend upon What Resources You Want to Protect and That All Comes
out Through the

Approval Process with the Engineer. That Engineer, Then, You a Points or
Let\'s the Inspection

Staff Know That Certain Operations Need to Be Inspected For Certain
Things Such as High

Pressure or If You Want to Look At the Protection of Groundwater
Aquifers. So the Frequency

or How Many Things Should Be Inspected Will Be Dependent upon the
Approval And What

They Feel Is a High Priority.

in Fact, We Could Have Several High Priority Inspections on One Drilling
Rig. We Could Do an

Inspection for The Aquifer Portion and We Could Do One on Well Control,
and There Could Be

a General Health And Safety Inspection If There Was H2s Involved or
Something Like That.

Could You Do a Number of Activities.

and Each of Those Would Be Considered an Inspection Activity? Or
Inspection Type?

it Would All Fall under One Type of Inspection, Being a Drilling Well,
and ‑‑ but You\'d Have

All These Other Activities Falling under That. We Don\'t Want a New
Drilling Type Inspection

Open for Every Activity. It Would Be Only the One, and Then You Have All
Your Subparts.

Wouldn\'t the Decision on That Be a Management Decision, or Is The Pet
Going to Be Making

Those Decisions? How Do You Arrive at Making Those Decisions, Either
Through Experience

or How Much Direction Do You Provide Those People in The Field? It Would
Be All of the

above. You Have Management Involvement Knowing What the Resources Are
Maybe on the

Surface and Also Their Involvement on the Downhaul. You Have
Coordination Between The

Engineers and Inspection Staff. So You Have a Variety of People Giving
You Feedback into

What Is Really Needed to Be Protected Out There. You Could Have Other
Resource Specialists

Such as Hydrologists And Type of Individuals, Letting You Know Where
Aquifers Are and

Particular Issues That Need to Be Inspected.

I Would like to Follow up With Another Part to That. When We\'re Working
with Other

Agencies, Who Has the Surface Compliance or the Environmental
Responsibility and How Do

We Handle That with Other Agencies, Say Bia or the Forest Service, For
Example, or Possibly

Even ‑‑ Well, it Could Be the Department Of Energy, I Suppose.

When You Are Dealing with Agencies Such as Forest Service Or Bia, They
Usually Handle

Their Own Surface Inspection Activities Because They Are a Large Enough
Agency and They

Have the Personnel and Also the Regulatory Responsibility. But When We
Start Talking about

The Corps of Engineers and Other Agencies, Bureau of Rec., They Usually
Depend upon Us to

Do Inspections, But, However, They Get a Lot of Feed ‑‑ They Give
Feedback to the BLM on

What Those Critical Things That Need To Be Looked at During the
Operation Are.

We Have a Call That We\'re Going to Take and this Is One From One of Our
Friends. Hopefully

it Will Be a Friendly Call. Carol in Mile City. We Will See How She Is
Doing. Hi, Carol. Do You

Hear Us?

.

Caller: Yes, I Can Hear You.

.

What\'s Your Question?

Caller: They Were Mentioning Spills, and I Noticed Lonny Mentioned That
under an

Environmental Type of Inspection And Also under Undesirable Event, and I
Wanted Some

Clarification for Documentation And Errors and a Spill Would Go Under an
Undesirable Event,

Not An Environmental Inspection; Is That Right?

You Could Have Both of Those, Carol. If under the Initial Inspection It
Would Certainly Going

under An Undesirable Event That Occurred but You Could Have Follow‑up
Environmental

Inspections by Your Nrs or Es That Would Want to Look at Cleanup of
Those Operations. So

You Could Have it Both Ways.

Caller: Would That Be Something a Pet Could Also Code Looking at a Spill
under an

Environmental Inspection.

Yes, a Pet Could Code That Under Environmental Inspection, And That\'s
Done in the

Coordination with the Environmental People Wanting That Pet to Stop by
and Take a Look at it

and Tell Them What They\'re Looking for. It Could Be a Variety of
Things. So, Yes, it Could Be a

Pet That Would Code That.

Caller: Okay. I Just Wanted to Get Some Clarification, Because in the
Past I Think We\'ve Just

Pretty Much Kept a Spill Activity Code Just under an Undesirable Event
Inspection Type. I Was

Wanting to Make Sure I Had That Clear in My Mind. Thank You.

You\'re Welcome.

Carol, Thanks for Your Call. You Get an Award for the First Live Phone
Call. Is it Snowing up

There?

Caller: Not Yet. It Might this Afternoon. Who Knows.

a Little Present for Us to Look Forward to this Afternoon. Thanks a Lot
for the Call.

Caller: Thank You.

See You, Carol.

this Is a Good Point for a 15‑minute Coffee Break, Don\'t You Think?
When We Come Back,

We\'ll Begin Discussing the Strategy Requirements and this Would Also Be
a Good Time for You

to Fax in Any Questions That You Might Have Regarding this Morning\'s
Presentation So Far. So

Let\'s See You Back Here in 15 Minutes.

Welcome Back to the I&E Strategy Telecast. Let\'s Turn the Program Back
over To Our Panel

of Experts Who Will Discuss the I&E Strategy Requirements and the
Priority Ranking Standards.

Remember, Folks, to Fax in or Phone Your Questions at Any Time. We Have
a Few Faxes That

We Would like to Address Now That Came in During the Break. Howard, Are
You Ready to Go

over To Our Viewer Questions?

Thanks, Paul. We\'re Doing Real Well. We Sure Appreciate Those Faxes.
I\'ve Already Received

a Pledge For \$25. At this Rate I Am Going to Beat Out Jerry Lewis. Keep
Those Pledges

Coming, and I\'ll Give You a Bank Account Later on for That.

Much Later.

Yeah, Right. Here\'s One. How Do We Code an Rv. Is the Activity Rvrr or
Rvpr.

I Would like to Explain What An Rv Activity Is. That\'s the Record
Verification And Type of

Inspection. There Are ‑‑ the Subactivity That Encodes for That Is
Indicated as a Pr or Rr, Which

Is a Production Records Review Or a Partial Records Review Being an Rr.
These Get a Little

Confusing, But I Hope Everybody Is Following along Here. The Pr Activity
Should Only Be

Used When You\'re Using the Type Of Inspection of an Imhi, Which Is a
Ph, or a Detail

Production Accountability Inspection, Which Is a the Detailed Production
Records Review

Portion. When You\'re Looking at an Rr, it Could Also Be Used in
Conjunction with an

Independent Measuring Handling Inspection When You Are Only Looking at
Reviewing a Few of

the Records, Not a Complete Records Review For a Particular Month. In
the Same Way with an

Rvrr Code Is That You\'re Looking at Those Records That Are Not
Associated with an

Independent Measuring/handling Inspection Nor a Detailed Production
Accountability Inspection.

So When You\'re Coding These Inspections and Using the Rv Code Don\'t
Use Pr in Conjunction

With That. That Only Indicates Records Verification Is a Partial Records
Review.

and the Second Part of it I Believe Is More a Comment That Might Go to
the I&E Strategy

Group. Can We Inspect Low Mineral Interests less than 10% That Also
Involves Low Production

Every Five Years Instead of Every Three Years as Required? To Me That
Sounds like Something

That Maybe Your Group Could Keep In Mind and Consider When You Put
Together the \'97

Strategy.

Yes, We Have Gotten Comments Similar to That from the Inspector
General\'s Office and Also

from Other People Within The Bureau That Maybe We Should Be Looking at
Production Levels

And Setting That Criteria for Low‑producing Leases to a less Frequent
Time of Inspection Based

on the Monetary Value of Those Inspections.

Okay. We Have Talked a Little about It, but Would You Just Take a Minute
and Let People

Know What The ‑‑ What That Group Is and Who Is it Made up by and Who
You\'re Reporting

To?

the National Policy and Guidance Group Was Established In a an
Instruction Memorandum And

I Don\'t Recall the New Number at the Moment, but What This Group Is
Made up of Are

Individuals from Each Individual State of BLM, Wyoming, Montana,
Colorado and So Forth, and

Mainly Made up of the I&E Coordinators. Some of Those Coordinators Have
Been Replaced by

Field Inspectors, but this Group Takes Care of Those on the Ground
Issues That Relate to the

I&E Program and Try to Bring Resolution to Them and Provide Draft Policy
Back to the Ad,

Hord Tipton in Washington, to Issue out to the Field. So in a Nutshell
That Will Be Our Purpose,

to Satisfy Some of Those Things That Need to Be Taken Care of in the
Field.

We Have Some More Faxes but I Think We Will Go to Don\'s Presentation
First. Don?

Thanks, Howard. Appreciate It. Let\'s Talk about How Inspection
Priorities Are Actually Set. All

Applicable Iids Shall Be Prioritized Each Year for Use in Preparing the
Strategy Plan Matrix. We

Talked about That a Little Already. I Am Going to Continue to Go Through
and it Kind of

Reinforce Some of These Major Points. Again the Strategy Plan Matrix Is
an Important Part of

the Process to Determine Our Capability and Most Importantly To
Determine How We\'re Going

to Be Most Effective out There on The Ground. We Need this Kind of
Information To Put it

Together Because Not Only Does it Provide for the Forthcoming Year but
Also Provides a Track

Record over Time Which Allows Us to Keep a Much Better Handle on Both
the Changes That

Are Going On, but I Think More than Anything Else, If We Get into a
Situation Where We Need

to Provide More Staffing, Quite Frankly, More Overtime, We Now Have a
Basis in Which to

Establish That. An Iid Is Either a Lease, Communization Agreement, Gas
Storage Agreement, or

Participating Area. Also I Would like to Add the Units of Mixed
Ownership, the BLM Policy

Directs the Authorized Officer to Approve And Manage Nonfederal Leases
in That Area along

with the Federal Interests. Have I Captured That Correctly, Lonny? Is
There Anything You Might

Want To Add?

Yes, They Are to Be Inspected Right along with the Other Inspection
Items the Same as You

Would Any Other One, Only That You Are Looking at Production
Accountability More.

Thank You. Now, Again, as I Mention, They Will Be Reviewed on an Annual
Basis Prior to the

Development Of the Strategy Plan Matrix. The Way We Do This, and I Will
Speak for Our Own

District There, We Have an I&E Coordinator in the District Officer and
We Have the Lead Pets

in the Area Offices. They Review Together What Has Been Done in the
Previous Year, Maybe

the Just Previous Two or Three Years, to See Exactly What It\'s Taken in
Terms of Time with

Respect to Inspections, How Much Time Is Being Afforded Actual Field
Time as Opposed to

Other Activities Going on in the District and this Is Really Important
in Terms of Knowing Just

Exactly What Your Capability Is. Categories for Prioritization Shall Be
Based on Fogrma Criteria,

Public Health and Safety, Environment, Subsurface Resources and Other
Standards. I Will

Discuss These in More Detail Later. Once Assigned, the Priority Shall
Not Be Changed in a Fiscal

Year. We\'ve Heard Some Dialogue That We\'ve Already ‑‑ We\'ve Already
Discussed with Respect

to ‑‑ Not So Much Emergencies, but Situations Where You Have Either
Pluggings and

Abandonments Coming in or Increased Drilling Activity. I Will Speak a
Little More to This Later,

but We Need to Recognize That the Scheduled Work and Planned Work Is
Very Important That

We Document That. But We Also Need to Recognize We Need to Maintain That
Flexibility.

I Guess of Interest Maybe to Some People That Are Newer to Preparation
of the Strategy, What

Do You Do in Your District, Don, When You\'re Putting Your Strategy
Together? Do You Get

Everybody Together in The Room When You\'re Discussing The ‑‑ Maybe If
the Engineers Have

Some They Want High and the Environmental People and You\'ve Got More
than You Can Do,

What Do You Do to Sort out What You\'re Going to Make Your Priority for
the next Year If

You\'ve Got Competing Priorities?

Well, Clearly, the ‑‑ it Has To Be a Situational Sort of Exercise That
We Go Through. Bringing

Both the Engineers Together, the Nrss and the Environmental Scientists,
as Well as Both Lead

Pets and We Also Bring the Other Pets in on The Process. We Go Through
the Review, Look

Throughout the Entire District, Area by Area, to See Exactly Where Those
Areas of Concern Are

That We Have, Where the Issues Are in Terms of Noncompliance, What We
Need to Do to

Address That, Whether We Have Environmental Concerns in Certain Areas
and Start Looking At

How We Should Initially Develop a Strategy to Provide Balance to the
Program but Also

Recognize the High Fogrma Mandates. After That, the Lead ‑‑ the I&E
Coordinator and the Lead

Pets, With Again Coordination with Petroleum Engineer, Will Sit Down and
Put a Preliminary

Strategy Together. We Will Review That Again, Validate It, If You Will,
to See How Things Are

Coming Together, And That\'s Our Initial Proposal.

I Know We Have Some Offices Where the Surface Management Agencies Input
and Maybe

Tribal Input Is Important as Well to Feed into That Overall Strategy.

That\'s Correct. In Our Situation We Also Have Some National Grasslands
We Work With. So

We\'re Coordinating with Forest Service on Those. As for the High
Priority Standards, the Iid

Should Be Rated High If Production Meets Or Exceeds the Following Level,
12,000 Barrels of

Oil per Month Or 120,000 Mcf per Month. For a Combination of Produced
Oil and Gas, Use a

Value‑based Equivalent of One Barrel of Oil Or Condensate to Equal 10
Mcf of Gas. In

Determining the Priority Rating for the Cas, the Pas and The Total
Average Production Shall Be

Based on the Total Production of That Iid Multiplied by the Percentage
of The Federal or Indian

Interest. Can You Provide a Little More Clarity? I Read That, but I\'m
Not Sure It\'s Clear to

Everyone.

What it Takes into Consideration Is the Amount of Interest That the
Bureau or the Government

Has in That Particular Inspection Item. So We Want to You Base Your
Production Level on

What Amount Of Interest We Have, Such as 10% Mineral Ownership or
Whatever it May Be, in

Some Units It\'s Even Less than 1%. So We Want You to Document the
Production in the

Database Based On What the Percentage of Ownership Is.

Thanks, Lonny. For Compliance Standard, an Iid Shall Be Rated High If it
Has at Least Two

Major or Six Minor Fogrma‑related Production Accountability Violations
Including Site Security

Within The Preceding Two Fiscal Years. With Respect to Environmental or
Surface Compliance,

I Think Most Of You Are Aware That by and Large Our Nrss or
Environmental Scientists Are

the Ones That Conduct the Surface Compliances. That\'s Typically What We
Do. Sometimes

There Are Exceptions To That. The Operations on an Iid Are Located in or
Adjacent to an Area

of Special Environmental Sensitivity. Some Examples Could Be the
Designated Wilderness Area,

National Park Service Unit, Wilderness Study Areas, Areas of Critical
Environmental Concerns,

Wetlands, Threat and Endangered Species Habitat, Historic Landmarks and
et Cetera. The Pry

Prioritization Could Include but Is Not Limited to These Examples. The
Operations on an Iid Are

Located in or Adjacent to an Area of Special Environment A.m.
Sensitivity. ‑‑ Environmental

Sensitivity. I Think We Just Went Through That. Didn\'t We? Yes. The
Environmental

Compliance History of the Inspection Item During the Preceding Two
Fiscal Years Included One

Major Violation or Five Minor Violations. I Would like to Also Add That
Just Because It\'s near a

Sensitive Area Doesn\'t Immediately Mean It\'s a High Priority Fogrma
Priority. You Have to Look

Even from the Preceding Year to See If, in Fact, That Priority Still
Holds, Whether the Issue Has

Been Resolved, Or, Quite Frankly, If It Still Warrants That High
Priority. So You Do Need to

Exercise Discretion. Management and Petroleum Engineers, Environmental
Scientists, That Gives

Them an Opportunity for Coordination on There to Determine Whether it
Still Warrants a High

Fogrma Priority or Just Exactly What The Situation Is. Do You Have
Anything You Want to

Add?

That Basically Covers That Pretty Well.

Okay. Thanks. Public Health and Safety. The Inspection Is Necessary to
Ensure Compliance in

an Area Where Specific Operations Could Pose a Serious Risk to Public
Health and Safety or

Where Noncompliance Could Result in a Major Undesirable Event as Defined
in Ntl‑3a Reporting

of Undesirable Events. We Also Have Compliance to Legal
Responsibilities. The Iid Requires an

Inspection To Comply with Existing Agreements, Memoranda of
Understanding, Laws and

Regulations. I Don\'t Know That I Can Address One Specifically, but Do
You Guys Know of ‑‑ I

Guess it Depends on the Agreements You May Have with a Cooperating
Agency in Terms of

How and What We Need to Do to Meet the Terms And Mandates of Their
Organization.

Juan Example Could Be Law Enforcement.

Okay.

Where You Have an Investigation Ongoing.

an Inspection Is Requested by Another Agency, as I Was Alluding To, My
Mms, Bia, Forest

Service or the Tribes, and as Lonny Was Mentioning, Law Enforcement the
Courts or Other

Judicial Body May Request Inspections Be Made. The Inspection Item Is
Located In an Area

Where There Is a Major Conflict Between Oil and Gas Activities and Other
Significant

Resources, for Example, Fresh Water Aquifers, Coal Seams, Surface and
Subsurface Mining

Areas and We\'re Talking about Where Those Activities Are Occurring
Within The Boundaries of

That Inspection Item. The Inspection Priority Ranking, The Overall
Priority Code. An Overall

Priority Code Is Established and Then Entered Into the Airs
Prioritization Record. For Purposes

of Airs, the Priority Shall Not Be Changed During That Fiscal Year. The
Required Number and

Type of Inspections Can Be Determined Using Airs Prioritization Record.
I Will Go Through this

and Then Maybe Lonny You Can Add More to Clarify this. A Fog My High and
Non‑fogrma

High Is a W. The Fogrma High and Non‑fogrma Low Is an X. And the Fogrma
Low and

Non‑fogrma High Is a Y. Fogrma Low and Non‑fogrma Low Is A Z. Now, I
Can\'t Really Speak

to These, but I Hope, Lonny, Can You Make Sense out of this.

Basically What We\'re Trying To Do Is Give Us Some Coding Into the Airs
Database for

Selecting Those Inspection Items When it Comes to Developing Your
Inspection Plan Matrix and

the W, X, Y and Z Are Just That, Identifiers of What Significant Items
We Have to Look at

Related To Fogrma or Not Related to Fogrma Issues. So That\'s in a
Nutshell What it Is.

and I Assume That\'s Probably Going to Appear as You Start Developing
the Matrix and You

Can See How this Particular Priority Set‑up ‑‑

They Will See That Coming out In the Matrix When We Come to That Point.

Very Good.

Let Me Try to Stump You Guys With a Few Questions We\'ve Gotten Here.
Why Is the Rating

for High Different Between Fogrma and Environmental High Inspections?
For Example, We

Rated Production High If There Are Two Major or Six Minor Violations and
Environmental Are

Rated High If There Is One Major or Five Minor Violations. Wouldn\'t it
Be Easier If We Had The

Same Criteria for Both?

the Criteria Is Actually ‑‑ Should Be Separate and Apart. The
Environmental Aspect Is

Completely Different than Looking at a Fogrma. We Wanted Fewer Violation
in the Major

Category in the Environmental Section to Put it Into That High Category
for Compliance. The

Fogrma Criteria for Compliance Was, in the Past, Used to Be less than
Six ‑‑ or Four Majors ‑‑

Excuse Me, Two Majors and Six Minors. Both the Development of the
On‑shore Orders There

Were More Potential for Major Violations. So We Upped That to Give Some
Relief to Operators,

in a Sense Of They Would Not Fall into That High Compliance Category as
Much And, That Also

Lessened Our Workload, Too.

since Imhi Criteria Has Been Upgraded to Include More Inspection
Requirements, Why Do We

Have to Have a Required Percentage of Dpais. Why Not Upgrade Imhis to
Dpais When Problems

Are Found.

We Didn\'t Feel with the Dpais Excluding the Percentage of Those
Completely, Although We

Did for a Portion of ‑‑ or All Of 1996, We Gave Offices an Option Not to
Include Any Dpais

Under Their Percentages. As You\'ll See When We Get into The Development
of the Inspection

Plan Matrix, There Are Going to Be a Required Percentage of 10%. This
Was Because There

Were Not Very Many Imhis Being Elevated To a Detailed Production
Accountability Inspection

Which They Were Intended To. So You Are Going to See Some Effort to Get
Back up Dpais,

and One this Is One of the Issues Also for the National Policy and
Guidance Group, to Look into

This and See What Is the Best Type of Inspection That We Should Be
Conducting. So We\'ll Get

into That Discussion a Little Later When We Start Talking about Building
Your Matrix.

Lonny, I Have a Question: We Work with Other Agencies. Let\'s Say, for
Example, the Tribes.

How Do We Do the Initial ‑‑ How Do You Recommend, I Should Say, That We
Do the Initial

Coordination with the Tribal Entities, Setting the Ranking Priorities?
How Does That All Come

Together And What Would You Recommend Both for Management as Well as The
People out

There on the Ground to Make this Work More Effectively.

There Needs to Be a Lot of Coordination Between Not Only The Tribes but
Also with Other

Federal Agencies. Bring Those Folks in and Even Interdisciplinary
Activities or People That We

Have. We Need to Bring Everybody Together That Has a Play in this
Program, What May Be

Some Concerns to Those Individuals Out There or Entities. We Just Need
to Start That

Communication Early, Get in Contact with the Tribes, Get in Contact with
Surface Management

Agencies, Your Other Personnel In Your Own Office, and Bring Those
People Together and Say,

Well, this Is What We\'re Going To Be Doing, this Is the Criteria. Do
You Have Anything That

Fits Into this Criteria? What\'s Your Recommendation to Us?

Thank You. I Assume We Get Some Feedback From Those Folks If They\'re
Not Pleased. I\'m

Not Assuming. I Am Asking from an Experience Standpoint: If They See a
Situation, They Get

Back in Touch with Us and We Will Make The Adjustments in How We Are
Setting the

Priorities.

Indian Tribes, We Have a Lot Of Them That Are Proactive in The I&E
Program. We Have

Cooperative Agreements. We Have to Bring Those People In. They
Definitely Do Tell Us What

Their Concerns Are and What They Want Inspected, and If They\'re Unhappy
with What BLM Is

Doing For Them They Will Certainly Bring That Up.

Can I Ask a Question in Terms Of How the Is Surface and Environmental
Concerns Are

Addressed, for Example, on Indian Lands? Is That Done by Our Folks? I
Know We Have a Few

Additional Area of Responsibility but How Far Does That Extend ‑‑

for Environmental Environmental Concerns on Indian Lands Except for the
Osage Where We

Don\'t Have Jurisdiction, but The Environmental Aspect Your Program
Falls Back to Bia and

That\'s Where We Bring Bia to the Table and Say These Are the
Complaints. Or These Are the

Concerns of Our Constituents Throughout and We Need to Have Certain
Things Done Or

Somehow Audit to Satisfy Those Concerns.

What about Native Allotments, Does That Same Hold True There? Do You
Bring the

Individuals in The Same as Would You a Private Land Owner in Any Case.

the Native Allotments Are the Same as Tribal Lands, the Bia Is Involved
There.

but it Would Be Our People Setting the Drilling High Priorities on
Tribal Lands. Because That

Would Be a ‑‑ Probably a Subsurface or Aquifer Related Issue. It Would
Be Our People. I Guess

That Issue of Surface Compliance on Tribal Lands, You\'re Probably Going
to See That Vary from

State to State And Office to Office Because There Are Bia Offices That
Don\'t Have the

Capability to Fully Perform That, and in Some Cases, That\'s Fallen Back
to the BLM, Right or

Wrong. But That Varies from Office to Office.

BLM Is the One That They See Out There. So We Get a Lot of the
Complaints, and We

Forward

That On to Bia.

I Would Think Because of the Importance of this this Would Influence Our
Percentages for

Dpais and Imhis in Terms of Fulfilling Not Only the Responsibilities but
Making Sure The

Production Accountability Is Being Handled in These Areas.

Yes, There Is a Lot of Feedback from the Tribes That They Want Their
Production Accounted

for and They Want Every Lease Inspected in Some Cases, but Others,
They\'re Perfectly Happy

with What We\'re Doing.

Very Good. Thank You.

I Think We Have Some Faxes That We Could Take. Was There Anything Else
on That That

You Guys Have?

No, I Have Some Closing Remarks, but Let\'s Go Ahead with The Facts.

Okay. Some of These Are Just Hot off The Press, So I\'m Not Sure Exactly
in Our Dialogue

That They\'ll Fit In, but We\'ll Try a Couple Here. In Our District We
Have Split Estate Lands

Where the BLM Owns The Surface and the Subsurface Is Owned by State and
Private. We Track

These as Needing Only Environmental Inspections but There Does Not Seem
to Be a Method of

Tracking Them on Airs. What Is the Proper Way to Track Them? Well, this
Question Is Correct.

Our Airs System Is Only Set to Include Inspections Have That Leases to
Them. So There

Wouldn\'t Be a Method as Far as I Know Within That System To Record
Those Inspections.

That Is Correct. We Have to Have an Inspection Item or a Lease to Tie
That Inspection Back to

to Have it in Airs, and If There Is No Federal Lease, Then We Need to
Track That in a Different

Method.

Here Is Another One: Should That Record Reviews Associated With Royalty
Reductions for

Stripper Leases and Royalty Reductions for Heavy Oil Be Coded to Rv, Rd,
Variable Rate

Determinations?

When You\'re Dealing with ‑‑ It Could Be Both Ways. In the Process of a
Dpai, of Course,

You\'re Going to Be Looking at the Royalty Determination, and What the
Rate Is, Right in

Conjunction with The Dpai. But If You\'re Doing Just Only a Royalty Rate
Determination

Separate and Apart from the Dpai, Then That Is to Be Conducted ‑‑ or
Documented under An

Rv/rd Activity, Is Your Proper Place to Put It, Yes.

That Was from Jeff out There In California. Thanks for That, Jeff. I
Apologize for Not

Identifying Who Some of Those Are from. This Is from Sheila, and
Compliance Standard: Do

We Include the Oral Inks or Just The Written.

I Am Not Too Sure What She Is Wanting to Know There. If She Is Saying
Include Them in The

Automated Inspection Record System, She Is the Data Entry Person for
Caliente Resource Area,

If in Conducting Your Inspections You Can Issue Verbal Warnings. If the
Violation Is Minor and

Inadvertent, Nonrecurring. In Those Cases, Regardless of Whether You
Issue a Verbal Warning

or an Incident on Compliance, it Is to Be Documented in Airs as Such.
There Are Codes Related

to ‑‑ That Will Detect Which One Is Which. Yes, You Record Both of Them.

Thanks. We Have One from Al. How You Doing Today, Al? We Appreciate the
Fax Message in

From You. How Will Bia Decision 9413 Dated June 7, 1996, Affect the Way
We Have Been

Conducting Production Record Review Activities? Lonny?

That Particular Ibla Decision, a Little History Behind It, the ‑‑ There
Is an Appeal by an

Operator to Ibla Discussing Issues Related to Submitting All the
Production Records, and this

Case Came out Of New Mexico Where the Ibla Judge Said That BLM Really
Didn\'t Have a Right

to Ask for Copies of Particular Documents. We\'re Not Sure at this Point
Where We\'re Going to

Go with That, but the Regulations That Implement Fogrma and the Judge
Was Using Fogrma as

His Basis That Even Though the Operator Needs to Maintain Those Records,
There\'s Nothing in

Fogrma That Says He Has to Submit the Documents to BLM. Alluding to That
BLM Would Go

to

That Office and Copy the Records Themselves and Then Go Back to Their
Home Office. Well,

That\'s Really a Burden for BLM to Do That Because, One Thing, the Cost
in Travel and Then

Getting Our Work Done. The Regulations Implement Fogrma, However, Do
State the Operator

must Transmit Those Copies to Us upon Request. Our Standpoint from the
Washington Office

Will Be That We Will Continue to Request Copies of Those Documents to Be
Submitted. So ‑‑

but We Haven\'t Worked That Issue out and That Will Be Another One That
Comes Before That

Policy and Guidance Group.

Don, You Want to Continue?

Sure. Let Me Finish up and Sort of Wrap up this Particular Segment.
We\'ve Talked about the

Planning And Setting the Priority Ranking. What I Would like to Do,
since We Spoke of it a

Little Earlier, Is There Is Occasions Where We Will Have Conflicts. How
Do We Deal with the

Conflicts in Terms of What We Planned with Our Overall Schedule and How
Do We Deal with

That? The High Priority Drilling and Abandonment Inspections Shall Take
Precedence and I Am

Going To Reinforce Much, Take Precedence over Production Inspections If
Scheduling Conflicts

Arise. Speaking as a Manager, When I Start Thinking Liability or What
Have You, or Health of

the Land Types of Issues, You Need to Stay Focused on Exactly What\'s
The Most Important, and

in this Particular Situation Where We Have That High Priority Drilling,
and Clearly in the Case of

Plugging, That\'s Extremely Important Situation. Drilling and
Abandonment Inspections Are

Externally Driven While the Production Inspections Are Controlled
Internally and Can Be More

Easily Rescheduled. I Guess My Sense Is That If There Is Any Conflict on
That, I Would Almost

Say That It\'s Always Important to Take Care of Those Ones That Have the
Greatest

Environmental Risk. Clearly in the Case of Plugging An Abandonment and
Also in the Case of

High Priority Drilling. I Know There Is an Awful Lot of Gas Development
Going On. There Is

Even More Oil and Gas, You Know, New Developments in New Areas That Are
Coming Up. We

Need to Really Respond to That.

It\'s Important, Don, That This Issue Be Brought up to ‑‑ In Light for
Management. In My

Reviews of Looking at Particular Offices, There Is a Lot of Lack in the
Ability or Willingness of

Management to Provide Overtime, and this Directly Relates to That. We
Need to Look at Those

Drilling Operations to Ensure That We Have Good, Clean Water Aquifers,
That We Protect

Other Mineral Resources, and We Can\'t Do That If We Don\'t Have People
Out There to Do It.

And Just ‑‑ My Opinion to Management Is, You Know, Really Look at Your
Resources, What

You\'re Really out There to Do, Protect the Environment, the Health of
the Land, and Make Sure

Those Drilling Operations Are Inspected. We Can Always Reschedule Those
Production

Operations. So It\'s Very Important We Emphasize That Point.

I Was Going to Say, No One Puts a Higher Emphasis on Drilling and
Abandonment Inspections

than I Do, I Guess, Whenever We Have this Discussion, but I Know It\'s
Real Important That We

Realize That At the Field Level There Are Some Situations Where They Can
Pick and Choose.

We Have Got Some Drilling That Might Take Place in Shallow Formations,
Very Low Pressure,

No Aquifer Situations, and That Might Be an Example Where They Have to
Pick and Choose,

and If They\'ve Got a Production Inspection They Really Need to Get,
That Might Be a Case

Where They Will Forego That Particular Drilling Inspection, Especially
If They Know the Rig

That\'s Drilling Those and Something About the Personnel and If They Are
Moving onto Another

One. I Guess We Can Never Say \"Always\" but Certainly That Has To Be
the Priority, the Drilling

And Abandonment.

Let Me Respond to Actually Another Aspect of and That It\'s Come to My
Attention from Time

To Time, When We Put the Schedules Together, Oftentimes, Although We
Don\'t Set Quotas or

What Have You on the Part of the Pets, I Think it Should Be Recognized
That There Are at

Least Percentages and Some Expectations as Far as Those Scheduled
Inspections That Are

Taking Place. The Individuals, the Pets out There, Need to Recognize,
and They Need to Get

Back with Management When These Kind of Adjustments Are Taking Place.
They Really Need to

Provide Documentation. I Know Everybody Is Concerned About Performance
and the Fact They

Are Being Adequately Recognized for the Effort They Are Doing but I
Think It\'s Important the

Dialogue Is Maintained Between Management And the Individual out There,
Particularly When

You Have to Make These Adjustments in Your Schedule, in Your Scheduled
Work Plan.

Yes, That\'s Also a Very Important Point. What the Influence Is in Our
Inspectors in the Field,

and We Need to Let Them Know That We\'re After Quality of Inspections,
And the Numbers Are

Going to Play a Big Part in It, but We Really Want Good Quality
Inspections, and Documentation

Plays a Big Part of That. I Will Cover More of That When I Get into the
Matrix Development.

I Guess My Concern on That Is That I Don\'t Want to Compromise The
Inspections in Terms of

Quality, but I Don\'t Want to Stress the People out to the Point That
They Think They\'re Working

Far Beyond What Maybe Their Personal Capability or We Are Making Demands
That Isn\'t

Realistic.

We Have Just a Couple More Minutes on this Segment. On Environmental
Inspections, Lonny,

as You\'ve Been Involved In Different States and Different Offices, I
Think in The past We Have

Had Some Issues About If it Was Ever Once a High Inspection for
Environmental That it Seems

to Have Been Carried over from a Drilling to A Production. Do You Want
to Kick That Around

For a Minute or Two?

I Would like to Comment on That. The Environmental Inspections, If
You\'re Going for a

Drilling Well, Could Be a High Priority Because You Have Surface
Disturbance, the Pit

Construction, Things like That And Once it Leaves That Drilling Status,
it May Not Require a

High Environmental Category Again. Basically Because it Might Be Based
on a T&e Species or

Whatever it May Be. Once You\'ve Disturbed That Surface, under
Production There Is No Need

to Have a High Priority Inspection for Environmental Concerns Unless, Of
Course, the Pet

Happens to Be By That Lease on a Particular Time When There Is
Additional Surface

Disturbance. Then That Particular Individual Needs to Contact the
Appropriate Environmental

Staff and Have Them Come out and Take a Look at It. So When You\'re
Looking at

Environmental Ratings and Rating Them to Those Concerns Alluded To in
the Strategy, or

Defined In the Strategy, Make Sure That It Does Fit and You Do Have to
Continually Review

That Process And Make Sure That They Are Properly Rated in There. So
Please Watch That.

Paul?

Well, We\'re Getting Ready to Take Another Short Break, but Before You
Leave, Give Me

Another Minute. Continue to Send in Your Faxed Questions. If We Can\'t
Answer All the

Questions on the Air Today, We\'ll Get Back to You Once the Course Is
over. If Questions Come

up at a Later Date, You Can Use the I&E Contact List That\'s Provided in
Your Viewer Packet. If

Your Office Would like to Tape the Matrix Preparation Portion of this
Program That\'s Coming up

Next, this Break Would Be a Good Time to Get Your Vcr Loaded and Ready.
Okay. We\'ll See

You in about 15 Minutes.

Hello. Thanks Again for Joining Us. Hour next Topic, Lonny Is Going To
Address the

Inspection Accomplishment Goals for Fiscal Year 1997. Lonny?

Thanks, Paul. First of All, I Think We Had Some Faxes That Came in That
We Want to Take an

Answer First. Is That Right, Howard?

Yeah, We Sure Do. We Will Take a Couple of These And Len Let Lonny Get
Going. We Heard

Back from Sheila in Bakersfield and We Apologize. We Didn\'t Quite Get
That Question of Hers

Answered. Reporting the Compliance Standard of Six Minor or Two Major
Ink Dues We Include

the Verbal Inks or Just the Writ 91.

the Verbal Warnings Are Not Included as Far as Compliance History. They
Are in the Database

to Let BLM Know or Our Offices Know What the Activities Were, What Was
in Compliance or

Not in Compliance at the Time. So, No, You Don\'t Use Them in Preparing
Your Compliance

Standard.

Okay. Thanks, Lonny. And Thanks Sheila. Here We Go. For Inspection
Prioritization, The

Suggestion Is That We Apply The Fogrma High Production Cut‑offs after
the Unit\'s Net Interest

Is Applied. This Would Eliminate Have to Go Inspect Large Producing
Units. So That Would Be

in the Realm of The Group That You\'re Going to Be Working with and to
Consider Things like

That. It\'s Back to That Question of Threshold.

Right. It Does Eliminate ‑‑ They Could Be High Producing Leases in Real
Time but as Far as

Our Associated Interests, We Don\'t Have Any Responsibility ‑‑ We Would
Rate Them Only on

Our Federal Participation. And Apply That to Fogrma Standard.

Thanks, Pat, from Colorado State Office for That Question. Paul Brown
Has a Couple

Questions for Us: Doing Active Iids Get a Priority Rating of Z Or None
at All?

Inactive Priorities or Inactive Iids?

Inactive Iids.

They Would Not Get a Priority Rating. The Overall Priority, There
Wouldn\'t Be Any, Because

They Are Inactive and They Don\'t Get Considered in the Ranking of
Inspections.

the Second Question Ask: How Do You Rank New Iids with No Production or
Compliance

History?

If You Have an Inspection Item That\'s Just Coming on for Inspection
Such as Just Has Been

Completed, You Can Go off the Completion Report and it Will Give You
Some Indication of

Whether or Not it Will Be a High Fogrma Criteria or If it Will Be In the
Non‑fogrma Category.

So Use That Completion Report.

I Think That\'s All We\'ll Take For Now. Lonny, You Want to Get Started.

We\'ll Get Started with the \'97 Inspection Accomplishment Goals, and I
Would like to Say a Few

Things about These. You Received Information in Your Viewer Packet about
What That

Percentages Were Going to Be. The National I&E Policy and Guidance Group
Is Going to Be

Looking At, Again, What Inspections That We Need to Be Conducting. I Had
Conducted a

Preliminary Workload Analysis on the I&E Staff and Based on That
Analysis We Could Do

Approximately 10% Dpais in the Remaining 33% Imhis. Now, When You Look
at Different

Issues Surrounding That, There Are Concerns Whether or Not We Should Be
Conducting the

Dpai on Low‑producing or Non‑producing Inspection Items of the Certainly
We Don\'t Want to

Conduct Them on Nonproducing Inspection Items. On Your Lower Inspection
Items, It Would

Be Questionable Whether Or Not You Would Want to Conduct The Dpai. So
the Group Is Going

to Be Looking at Maybe Establishing a Threshold of Where a Dpai Would
Not Be Conducted or

Scheduled Unless There Was a Problem That Was Identified Through the
Independent

Measurement/handling Inspection. And in the Imhi, We Are Looking At
Trying to Reinforce That

Inspection, Trying to Make it to Where We Have Better Capability To
Identify Problems That

Are Occurring and Use it as a Flag System to Elevate Inspections to A
Dpai. Then Going into

Those Inspection Accomplishments We Want to Do For Fy97.

Excuse Me, Lonny. We Have a Phone Call That I Believe Is a Question on
Clarifying Inactive

Iids. This Is Carol in Miles City. Let\'s Take That. Hi, Carol.

Caller: Hi. You Will Have to Listen to My Voice. We Don\'t Have a Fax
Set up out Here. I

Have to Call.

That\'s Great! It\'s Good to Have the Phone Calls.

Caller: What I Was Wondering Is on the Question of Inactive Iids and If
You Set a Priority For

Those or Not, I Think There Is Some Concern on What an Inactive Iid
Really Is, and to Me It\'s

like There Is a Difference Between Whether It\'s In the Abandoned Stage
or Whether It\'s Truly

Inactive, Which Would Mean That Everything Is like the Surface
Restoration Is Done and

Everything Is Done. A Lot of Times There Is Maybe a Ca That Still Has a
Well That Is Not

Plugged or Something like That, and That\'s Considered an Inactive
Because the ca Is Terminated

but We Still Might Have Liability out There for an Unplugged Well, and I
Think We Mead to

Clarify What an Inactive Iid Would Be Compared to Just an Abandoned Iid.

an Inactive Iid, Carol, Would Be One That Didn\'t Have, of Course, Any
Activity on It, but If

You Are Looking at Communitization Agreement with a Federal Well on it
and the

Communitization Agreement Expires, That Well, Then, Should Be
Transferred to the Lease and

Carried on a Lease Basis, Not Under the ca Agreement.

Caller: I Agree with That. I Think That\'s Good to Know for Some People.
There Is Some

Question on If Every Well ‑‑ on an Iid Is Abandoned, That the Surface
Restoration Hasn\'t Been

Done, I Think They\'re Kind of Confused Between Do They Consider That to
Be Inactive and Do

They Set a Priority for That?

When You\'re Looking at Abandoned Iids, We Get into the Prioritization
with the Environmental

Scientists or Whoever Takes Care of That to Look at the Reclamation
Aspect, Not as Far as the

Production Related Are Basically I&E in the Sense of Our Inspectors
Mainly For Reclamation. So

When You\'re Looking at Abandoned Status, We Also Do Prioritize Them in
the Environmental

Category Only and Use That Information to Build Your Matrix, but Other
than That, You Don\'t

Use Any Other Codes.

Caller: Okay. So Inactive Iids Would Never Get Any Kind of Priority for
Anything? They Are

Pretty Much Completely Dead, Iids?

That Is Correct. All the Wells Are Plugged and Abandoned and There Is No
Activity, No

Facilities to Look At. Those Leases Are Then Carried on Airs Forever So
We Can Go Back And

Do Statistical Information On Those, but You Would Never Consider Those
into Your Matrix. If

You Have Those Are Inaccurately Coded, Then You Need to Look at the
Proper Coding for

Them.

Caller: Okay. In the Lease Status, That\'s Where We\'re Talking About,
Whether It\'s Active or

Inactive On or Whatever, If You Have a Federal Lease That Has Some
Federal Wells in it and All

of Them Are Shut in for Example, Would You Consider That to Be an
Inactive Lease or Is it Still

Considered to Be Held by Production Because it Still Is a Viable Lease
but All Wells Are Shut

In?

You Wouldn\'t Be Inactive Because You Still Have Some Responsibility
from an Inspection

Standpoint. It Would Probably Be Best to Hold it under the Previous Code
Until All Those Wells

Are Plugged and Abandoned.

So Would it Show as Held by Production Even Though There Is No
Production Associated? So

it Would Still Be Considered Held by Production?

Right, So Can You Bring it up Into Your Matrix for Looking at It for
Environmental Reasons or

It Could Be Even Production Related If They Were to Go Back Out and
Start Those Wells up

Again.

Caller: Okay. That\'s What I Needed to Know.

Okay.

Caller: Thank You.

You\'re Welcome. Don, Did You Have Follow‑up.

I Did, and I Have a Question. I May Not Be Articulating it Quite the
Right Way: If You Have a

Temporary Abandon or Shut‑in Well, I Understand from What I\'m Hearing
That You Wouldn\'t

Have an Inspection Item, per Se, but Is it Not True You Do Have a
Management Responsibility

to Follow up with The Operator to See What Their Intent Is with Respect
to Either Plugging That

Well or Following Up with Just Exactly What Their Intent Is? Because
Otherwise We Can Sit

With Wells out There, as I Understand It, for Years, Temporary
Abandoned, Shut in and They

Are Sitting on the Rolls, And I Understand What You\'re Saying as Far as
Keeping Track Of

Those, but from a Management Standpoint and Environmental Compliance
Standpoint, It\'s in Our

Best Interest to See If They Are Going to Produce Those or Their Intent.

You Have Hit My Favorite Topic. In Terms of the Strategy, I Think
That\'s What We\'re Talking

About. This Doesn\'t Relate at All to Our Responsibility to Take Care Of
Those Temporary

Abandoned Wells.

it Would Still Remain as an Inspection Item Because It\'s Not Inactive
Anymore. There Is No

Production, but You Still Have an Activity out There To Look at ‑‑ or
You Have a Responsibility

to Look at Those Wells. So You Still Carry it as Either Held by
Production or Some Other Code

Other than a or I Which Means Abandoned or Inactive in The Code. That\'s
How We Generate the

Numbers.

So It\'s Not Essentially Closed out. You Keep it on the Books.

You Bet. And You Have To, as a Manager, Look At, Well, Do I Need to
Conduct an

Inspection, or Your Staff Will Be. They Know What\'s out There and Be
Able to Work That out.

and Even If it Was Inactive In Terms of the Strategy, There Is a
Separate Tracking Database For

Ta Wells and We Have One for Shut‑in Wells as Well. They\'re a Real High
Priority to Get

Something Done with Them. We Are Only Talking Kind Inform Reference to
the Strategy Itself.

We Would like to Thank Carol for That Question and There Were a Lot of
Good Points There. I

like That Visual Where They Put That Map of Montana up There And Show
Where Carol Is in

Miles City, but it Reminds Me Just Northwest of There Where the Elk Is
That I Didn\'t Get Last

Week. So That\'s Kind of a Painful Deal.

Lonny?

We\'re All Crying over That, Howard. Anyway, Back onto Our Inspection
Requirements for

Fy97, the Information That You Received With Your Packet Concerning the
Number of

Inspections or the Goals We Want to Achieve for This Year Are for the
Drilling Activities We

Want to Conduct All High Priority Drilling and Abandonment Operations,
and We Allude to Do

this Before, That We Need to Make Sure That We Are Getting Those
Inspections and Properly

Rating These Activities So We Can Get Our People on the Ground to Look
at Them. The next

Criteria Are the Production‑related Inspections And That\'s a Detailed
Production Accountability

Inspections. We Want 10% of Everything That\'s Produced in the Last 12
Months And We Will

Get into What We Mean by That, Last 12 Months of Production, in a Little
Bit When We

Develop Our Inspection Plan Matrix. Keep in Mind It\'s 10%. Most of You
Have Worked with

This Already and Know What I\'m Talking about. But for Those of You That
Are Just Joining Us

for this Exercise, We Will Get Further Discussions Here in a Moment.
Continuing on with the

Production, Independent Measuring/handling Inspections, We Want 33% of
All of Our Iids Left

over after You Determine Your Dpais to Have an Independent
Measuring/handling Inspection

Performed on Them. Also There Are the Production Records Reviews Which
Are Not Part of

Any Requirement or Any Percentage Related, but Those Type of Inspections
Are Also Conducted

and That\'s Where We Find a Lot of Our Problem Areas, In Production
Records, and There Are

Fewer Problems in the Field. And There Are Reasons for That, But We
Can\'t Go into That

Today. Moving on Now into the Environmental Category, We Want All the
Environment ‑‑ All

the Inspection Items Are Rated High To Environmental Categories Should
Be Inspected. That\'s

for Whatever Reason It\'s Rated High To. It\'s Not Necessary for Them to
Look at Everything. It\'s

Depending upon the Reason It Was Rated High. These Are Inspections
Usually Performed by

Other People than The Pets, and Usually Your Environmental Scientists or
Natural Resource

Specialists. Workover Inspections, Those That Are Categorized as High
Priority With the

Engineer Reviewing Those Operations and Approving Them, They Will Let
the I&E Staff Know

Which Ones to Inspect. So Those Will Come out. Also Undesirable Events.
These Are Going to

Be Conducted On an As‑needed Basis, but as We Get into the Strategy
Matrix Development, We

Will Let You Know How to Determine Those. The next Inspections That We
Have Are the

Public Health and Safety Inspections. Conduct All High Priority
Inspections There. Now, These

Are Related Mainly to Hydrogen Sulfide Operations. That\'s Going to Be
Your Main Category for

That. But There May Be Other Reasons. Legal and Other Standards, We
Talked about the

Prioritization Of Those Two Categories, and You Conduct All High
Priority Activities There. So

Moving on into the Remaining ‑‑ That Concludes Our Discussion On the
Fy97 Inspection Goals. I

Will Turn it Back over to Paul For Further Things.

Thank You, Lonny. Some of You May Want to Record This Part of the Matrix
Preparation,

Because it Tends to Get a Little Complicated. Before Lonny Actually
Begins Talking about

Preparing It, You May Want to Start Your Vcr Now. Lonny?

Okay. We\'ll Get into Preparing the Matrix Now and like Paul Said, This
Is Probably One of the

Most Confusing Aspects of the Inspection Program, Is this Session We
Call of Establishing Your

Inspection Plan Matrix and I Would like to Let You Know That the
Inspection Plan Matrix, It

Does Seem Complicated, but If You Break it down by the Pieces That Are
in That Particular

Exercise, it Becomes Very Evident That You Have to Go Through These
Particular Roles

Determine What Can You Do. The First Three Sections, as You Can See on
Your Own

Inspection Plan Matrices Sections 2, 3 and 4 Are Basically an Inventory
of What You Have, and

We Will Discuss That Inventory in Detail When We Start Developing the
Inspection Plan Matrix.

You Get into Table 5, and it Basically Gives You Your Capabilities, and
What Are Your Abilities

to Conduct Inspections? Then Table 6 Lets You Know What Is Your Workload
Capabilities

Based on the Amount or Capability You Have to Perform Work and Also
Taking into

Consideration the Goals Set by The Washington Office. Also on Page 2
I\'ll Elaborate There a

Little Bit. On Page 2, That\'s the Mechanism Or the Worksheet in
Developing What You Can Do

with What You Have Available Resources with. So Let\'s Move on into the
First Category of

Your Matrix, Which Is Your Production‑related Inspection Items. Again,
this Is an Inventory of

What Your Inspection Items Are, And Related to Production. Now, You Were
Provided Some

Airs Database Files to Retrieve Information and to Be Able to Build
this. You Should Have

Already Prioritized Your Inspection Items for Fy97 and Be Able to
Generate the Information

Needed To Go into this Category and to Do That, along with Your Airs
Database File, What

Should Have Occurred, or to Get this Information You Needed to Go in And
Change the Fiscal

Year, Then, in this Wocnt.fex File and Change the Fiscal Year to 97 So
You Are Able to Retrieve

That Information. Also in the Remarks Section or Heading over Here on
the Side, Also Change

That One to Fy97. Most of You Are Very Familiar With this. We Are Going
to Go Through it in

Quite a Bit of Detail So That We Can Bring Those Who Are less Familiar
and Answer Some of

Those Questions Related to Some Of Their Concerns up to Speed. We Will
Continue on Here.

When You Generated That Report From Airs, You Should Have Gotten a
Report That Looks

Similar to this. It Gives You Your Overall Priorities, Which Gives You
the Number of Overall

Priorities and What Don Had Talked about Your W, X, Y and Z, and One
Thing You Need to

Remember That this Number Here Is Your Fogrma Required Iids. We\'ll Zoom
in There a Little

So You Can See That a Little Better. These Are Your Y and Z Are
Non‑fogrma Criteria. We Will

Be Talking about These Two Particular Areas When We Start Developing the
Inspection Plan

Matrix. You Also ‑‑ If You Have Indian Work Log, You Are Going to
Generate All Your

Inspection Items by Overall Priority and That Will Give You the Number
of Counts for Those

Overall Priorities for the Association That You Have with Your Tribal
Documented in Airs. So

You Have These Two Here, and It Shows You Again the Overall Priority by
Usually Bia or by

Reservation. And We\'ll Be Working These Also Into Our Matrix. Also You
Needed to Go in and

Generate a Zero Production Report from Airs That We Talk About this
Produced in the Last 12

Months and Have Not Produced In the Last 12 Months. You Need to Go into
the Monthly

Report of Operations or Mro, and Pull out Your Zero Production Report to
Determine the

Number Of Those That Hadn\'t Produced in The Last 12 Months. So in Our
Database, We Show

That ‑‑ and We\'re Going to Use a Sample Office Here. We\'ve Made One up
So it Comes Out

Perfectly ‑‑ or at Least We\'ll Demonstrate That Today. But it Shows How
Many Inspection Items

by Overall Priority, How Many Have Not Produced in the Last 12 Months.
So Then We Can Put

That into Our Database. As You See Here, There Are None That Indicate
Indian over Here.

Usually If an Inspection Item Doesn\'t Produce on Indian, They Are
Terminated Quite Rapidly.

You Won\'t Find Many in Your Database. There Are Some Instances Where
They Do Occur.

Going Back, Then, to the Table 2, Giving the Production Inspection
Items, We Are Going To

Look at How to Put this Information into the Matrix. Here Is the Wide
Angle of this Particular

Box. Pardon Me for a Moment While I Remove Some Stuff in My Way Here.
Dms Are

Notorious for Fixing Things the Way They Want Them.

That\'s Why We\'re Dms.

Yes, They Have That Ability To Do That. Anyway, We Are Going to Go in
And Not Worry

about this Total Inspection Items at the Moment Here. We Have What You
See Produced And

Nonproduced, and We\'re Basically Talking about Those Two Areas When We
Pull That Zero

Production Report, How Many Have Produced in the Last 12 Months And How
Many Have Not.

Moving into Our W\'s ‑‑ You Can Follow along Also in Creating Your Own
Matrix at this Time,

Using the Information, If You Have Not Already, And, Again, We Will Go
Through this in a

Little Bit of Detail, However, We Are Just Going to Deal with the
Federal Numbers at the

Moment to Save a Little Time and Help Us Get Through this a Little More
Simplistic So That

You Can Get The Gist of What We Need to Do. From the Report That We
Generated from Airs

We Have this Count of Iids by Overall Priority Here and the Number of
Those Being Identified.

So We\'re Going to Use Those and Put Them into Our Table, Which We Have
26 That Are W\'s

and 0 That Are Nonproducing in the W Category, and Then the X Category,
Which, Again, this

Is All of Your Fogrma High Criteria, So We Are Going to Identify All of
Those to Build Our

Matrix, and We Have 30 of Those on the X\'s That Have Produced and 0
That Have Not. Then

We Move to the Y Category And Again this Is Your Non‑fogrma Criteria,
and Produced in the

Last 12 Months Were 90 and There Was 30 That Had Not Produced, and We
Had 94 That

Produced under the Z Category and 20 That Did Not. Now, What Is Going to
Happen When You

Generate this into Wordperfect and You Select the Calculate Function on
Wordperfect, it Will

Automatically Populate These Fields Here with Numbers All the Way
Across, and Then That

Information Will Then Be Brought Down into Your Matrix. Hopefully I Am
Going along Fairly

Slowly for You So That You Can Follow along and Keep Up. Once We Have
Determined That

Values, Then We Go into the next Category, Which Are Drilling and
Plugging, and Again We Are

Just Doing Our Inventory. So, Keep That in Mind, That We Are
Inventorying What We Have For

Conducting Inspections. But Keep in Mind These Numbers We Are Going to
Be Generating

Here. Moving on into the Drilling and Abandonment ‑‑ or Drilling
Workover Inspection, and Also

Plugging, You Have on the Sheet It Identifies the Number of High
Priority and Low Priority

Inspections, And, Again, by Federal and Indian. Again We Are Going to
Deal with The Federal.

A Few Comments Related to High And Low Priority. These Inspections Are
Forecasted From

Previous Years\' Experience Or Experience That You May Have In
Contacting Operators or

Operators Submitting Apds That You Know You Are Going to Have An
Influence of Drilling or

Even Abandonment Operations During The Year. These Are Then Prioritized
Based On Where

They\'re At, What Formation Is Going to Be Encountered, So on and So
Forth, By the Petroleum

Engineer. These Are Things That Are Downhole Problems That May Occur In
this Category. So

in the Experience That You\'ve Had, You Can Determine How Many Are Going
to Be High and

How Many Are Going to Be Low. In Our Imaginary Office We Have 21 of
Those Drilling

Operations That Are High and 18 That Are Low. On the Federal Side. Then
Moving into Your

Plugging And Abandonment Operations, this Is the Same Criteria Falls in
Here. The Plugging

Operations I Prioritized by the Engineers and They Inform the I&E Staff
What Needs to Be

Inspected, for Instance, What Plugs Need to Be Witnessed, What Plugs
Need to Be Tagged and

So on and So Forth, And Some Offices Have a Greater Emphasis on Plugging
Operations Than

Others, Just Depending upon Where You Are in the Country and What You
Have to Deal with as

Far as Protecting Resources. In Our Plugging Operations We Have 32 That
Are Going to Be

High and 10 That Are Going to Be Low. Now, If You Move over into the
Workover Operations,

These Operations Are Also a Forecast Based on the Previous Years\'
Activities, And, Again, the

Engineer, When Approving Such Operations, or Knowing of Them, Wants
Particular Things

Witnessed, They Will Notify the I&E Staff Again and Have Those
Operations Witnessed. So in

Forecasting How Many We Have to Complete, We Had 15 High Priority
Workover Operations

and 6 Low. Now, Again, Workover Operations Are Optional to Witness or to
Inspect by the

Strategy, but If You Do Have Some, and If You Have Rated Them High, Then
Inspect All the

High Priority Items. The next Category That We Need To Move into Is the
Environmental

Section And, This, Again, Is Where You Have Coordination with Your
Environmental Folks on

What Activities Need to Be Looked At. So in Looking in Box 4, Let Me
Zoom out Here, And,

Again, We Are Just on the Inventory Aspect Of What We\'re Doing, So If
You Have Your

Environmental Inspections Are Identified Here On Table 4, and We Will Go
in Here, and Again,

We Have Drilling Activities, We Also Have Producing and Also
Abandonment/reclamation

Activities That We Are Going to Be Looking at for Environmental
Concerns. Also in this Activity

When You Are Dealing with Drilling, You Are Going to Be Looking at
Previous Years\'

Experience Also, And this Will Come Again ‑‑ Well, this Time Not from
the Engineers, but from

Your Environmental Folks of How Many In the past Had Been Rated High To
Environmental

Concerns, And, Again, It\'s a Forecast. So in Our Office We Had
Indicated We Had 20 Federal

That Were High and 19 That Were Low. The Thing That You Need to Keep In
Mind Here Is

That When You\'re Looking ‑‑ I\'m Sorry, I Should Have Used this Other
Card. We Had 20 High

and 19 Low. I\'ll Get You Back in Focus Here. I Was on the Environmental
Inspection for

Drilling. One of the Things You Need to Look and Keep in Mind That the
Number of Wells That

You Forecasted up Here under Drilling under the Tentacle Activities Is
21 High and 18 Low. The

Total Number must Balance With the Total Number down Here. These Have to
Correlate Back

and Forth. You Are Looking at All Your Activities. You Are Not Just
Looking at Identifying the

20 High and Then Not Putting in the Rest of Them In the Low Category.
That Would Be the

Same Way Throughout All of These Activities. Now Moving on into the next
Section Where

We\'re Talking About Producing Environmental Activities, We Have to
Also, Then, Take the

Total Number up Here of Producing, Which Is the 240 ‑‑ Okay. There Was
240 That Produced

and 50 Nonproducing. Well, These All Have to Correlate Back to Here
Again. So When Putting

Your Producing Numbers in There 50, There Has To Be a Total of 290, So
There Were 50 High

and 240 Low. Now, That Was Pretty Convenient How We Worked That All out.
It Was Probably

an Engineer, Like a Drilling Engineer or Something, That Helped Us Do
This One. They Wanted

it Simple. Moving on to Your Abandonment/reclamation Ones Here, These
Are Categories

Where You Have in the Database Those Abandoned Iids. There Are a Certain
Number That Are

Going to Be High and a Certain Number Going to Be Low Depending on Where
You\'re at in The

Reclamation Aspect of That Particular Well. So You Take That Information
From Airs or from a

Database of Your Own, However You Tracked That Information and You Put
it Into the

Database. For Our Particular Office We Had 30. There Were High and 0
That Were Low of the

Basically What We Have Done Here, We Have Finished Through Block 4 and
We\'ve Completed

Our Inventory Now ‑‑

Can I Interject a Question Right Now If I May.

Yes, Can You.

I See Some Changes Between The Downhole ‑‑ You Have Made Some
Adjustments There and

the Environmental Inspections You Have Also Made Adjustments That Don\'t
‑‑ They Track If

You Look At Total Numbers but Don\'t Necessarily Track in Terms of High
and Low Priorities.

Who Make the Decisions Between Whether the Environmental One Is A Lesser
or Greater

Priority or How Do You Make That Adjustment And That Sort of Trade‑off.

You Have to Look at Each of Your Your Staffs Are Looking at Those Issues
and Your

Environmental People Let You Know What Is Going to Be High to The
Environmental Category

and What Is Going to Be Low. So There Has to Be That Coordination
Between Both Parties, the

Engineers and Environmental People to Say, Okay, We Have a Lot of
Downhole Problems,

Concerns Here, but it May Not Be a Surface or Environmental Concern You
Have To Worry

about. So There Just Has to Be That Coordination Between the Two Groups.

What If They Don\'t Agree? Who Is Going to Resolve That or How ‑‑

Well, I Don\'t See Any Time That an Engineer Would Disagree With an
Environmental Person

on An Environmental Concern Because That\'s Their Area of Expertise. If
They Do Disagree,

Then You Get to Be the Referee.

Thanks.

Now, Are There Any Other Questions? Howard, Do You Have Something?

I Would like to Pass Back to The Field Offices That We\'re Going to Have
a Formal Telephone

Question Period Here Coming up In about 10 Minutes. If You Would Please
Be Thinking About

What Those Questions Are That You Have and in Five to Ten Minutes Start
Calling Those in

And We Have a Hold System Set Up. So We Will Be Taking Those in About 10
Minutes.

Thanks.

Now That We Have Determined Our Inventory of What We Have Out There,
What We Want to

Do Now Is Determine What Our Capabilities Are. The Number of Staff
Associated With the I&E

Program That Will Not Only Devote Time to Conducting Inspections, but
Also The People That

Will Be Supporting What Our Inspectors Do in the Field, Clerical
Support, Managerial Support.

So If You Turn Now to Table 5 on Your Matrix, this Is Where We Develop
That Information.

You Are Going to First of All, Identify the Number of Individuals That
You Have on Board, and

Those Individuals on Board Are Going to Be the Pet Auditor, the
Supervisory Pet, Any Tribal

Inspectors That You Have, Any Other Individuals That You Have. Let Me
Stop There a Little Bit

On \"Other.\" We Use the Other Category for Crisis Management. Such as
Petroleum Engineers

That May Help out in the Area of Plugging Operations. If We Don\'t Have
the I&E Staff To

Cover Everything, or If They\'re All Busy, Then We Have Offices That Use
Petroleum Engineers

or Even Geologists to Go out and Take Care of Those Operations for Us.
So That\'s a Very Good

Point to Make, Is That There Are Other Staffs to Get Involved in the
Program, and They Help

Complete It and Make it a Success. That\'s Where Those Individuals Are
Identified.

along Those Lines, Lonny, it Seems like Some Offices Kind of Think of
the Strategy and the

Matrix as Being a Done and Final Deal, and Maybe We Could Talk For Just
a Minute about

Really The Need to Keep That a Dynamic Document. I Mean, If You Get a
Big Drilling Activity

Plan or Abandonment Plan, Whenever That Comes, They\'ll Have to Go Back
In and Amend That.

Right and Get it Resubmitted So Everybody Knows What\'s Going On.

Don Made a Very Good Point of That When He Was Talking about That
Particular Issue, and

That It Is a Dynamic Document. You\'re Going to Have Unknowns That Are
Going to Come at

You, And You Have to Have the Flexibility to Change with the Unknowns.
And the Best Thing

Can You Do Is Keep Your District or Your State Office or the Washington
Office Informed

What\'s Going on So That We Know That If You Don\'t Make Your Original
Forecast at Least

You Have Some Documentation Backing up What You Did.

I Guess That Also Ties to as Soon as a District or Field Office
Understands You Have One Of

Those Problems Facing You, That Might Be When They Need to Start
Thinking About, Well,

Are There Some People from Other Offices They Could Bring In? Can They
Use Their Petroleum

Engineers, Particularly the Drilling Engineers? There\'s Nothing Better
than That, of Course. Or

That Use of That Overtime That We Talked about.

There\'s Difference of Opinion On Drilling Engineers, but ‑‑

but I Mean That\'s the Point In That Matrix Where They\'re Going to Have
to Look at What Their

Capability Is Again and Look at Who Is Available and Get The Word out to
Other Offices If

They\'re Really Pressed with That.

That\'s a Very Good Point to Make, That Don\'t Feel Alone out There in
this Program, Because

There\'s No Document or Policy That Says You Have to Stay in Your Own
District or Resource

Area Office. It\'s Where We Need to Get the Work Done.

Let Me Follow up with That a Little Bit. If It\'s Temporary, in Other
Words, You Are Going

down Maybe Two or Three Weeks or Something Like That and You Are on a
per Diem Stat Us

and You Are Not Commuting, Say, Long Distances, That\'s One Thing. But
the Costs Associated

with Moving Somebody or Bringing Them Over on per Diem Status for an
Extended Period of

Time Can Really Eat up Your Funds. I Guess the Message and the Message
That Needs to

Probably Come out Is That We Really Need To Make Certain That We Have at
Least a Minimum

or a Core Group To Fulfill Those Functions, and If We Don\'t, We Need to
Think Seriously about

Hiring These Folks and I Am Not Sure How We Can Do That ‑‑ I Mean, Know
How To Do the

Hiring, but I Am Not Sure How We Can Reestablish the Priorities and
It\'s Fran Clay Real

Difficult to Hire People Right Now Because We Are Trying To Keep Our Fte
Ceilings down. But

Not So Much as a Caution, But That Sense of Awareness, You May Have to
Shift Your

Overtime Money over to Take Care of These Problems but If You Start
Running into Extended

per Diem For Someone Being Reassigned to Another Office, it Can Escalate
Problems down the

Road and You May Come out Short at the End of The Year.

and That Goes Back to Your Priorities and Just How Critical They Are. If
You\'ve Got Some

Deep Drilling That Might Take Place and You\'ve Got a Bunch of Raise
Line That\'s Going to to

That, You\'d Have to Look at and That See What\'s at Risk and You Might
Have to Just Eat That

per Diem Cost and Bring Some People In.

I\'m Not Suggesting That We Compromise Anywhere along the Line. I Think
We Just Need to

Be Aware And Use Those Funds That We Do Have Very Wisely in Terms of How
We Do this

and Frankly Keep Track of It. We Still Have Flexibility to Move Some
Funds Around from Office

to Office and That Sort Of Thing, but it Really Takes Staying on Top of
it from an Accounting

Standpoint So the Dollar Resources Are There So We Don\'t Come up Short
in the Fourth

Quarter.

and It\'s Back to That Matrix As the Planning Tool the Managers Can Use
to Really See Where

They Are Coming out and If They Are Hit with One of Those Special
Projects, Then this Thing Is

Going to Give Them That Tool to See How Much Short of Capability They
Are. So I Don\'t

Know of Any Other Program That the Bureau Has That Has the Capability of
Really Seeing What

Kind of Capability They Have, What an Average Workload Looks like and
Can Patch Those Two

Things Together To See Exactly What Their Resources Are to Get the Work
Done. I Think If

There\'s ‑‑ Even Though a Lot of Us Cuss and Discuss That Strategy
Document And Going

Through These Matrices, I\'ve Had Comments from A Lot of People in
Different Programs That

Say, You Know, We Wish We Had the Capability That You Guys Have
Developed to Show

Where Your Workmonths Are Going And What You Can Get Done Fairly
Precisely with the

Work Loads You Have. It\'s a Good Document.

Yes. Moving on into Our Analysis Here Of Our Workload Capabilities, Our
Staff Capabilities,

We Want To Identify Not Only Those People That Do the Technical Aspect
of the Petroleum

Engineers, Supervisor Pet or the Tribal Pet and Other Individuals, but
Also for the Environmental

Side We Are Going To Identify a Natural Resource Specialist or the
Environmental Scientist

That\'s Going to Be Contributing Time to Conducting Those Environmental
Inspections. The

Other Area Is Your Clerical And Administrative or Manager Support, and
this Comes in Where

You Have Staff That Is Helping Out with Data Entry, Clerical Staff to
Write Letters and Things

in That Regard. The Other Is Then Where Your Management Falls into Play,
Your Dm, Your

Area Manager, Your Supervisory Pet That May Be Involved or Supervisory
Engineer, Whoever

Handles That Particular Action. Those Get Identified in Those Areas. So
We\'ll Start to Fill this

Area In So That You Get an Idea of What We Have to Work with out There.
In Our Pets, I\'ll

Focus in Here A Little Bit, We Have the Number Of Those ‑‑ in Our
Particular Office We Had 2.

Supervisory Pet, We Had 1. We Had One Tribal Inspector. 2 Other
Individuals for a Total Of 6

over Here. The Natural Resource Specialist, Then, There Is One
Individual That Had Done That

Work. The Clerical and Managerial Support, Fte Are Two in Clerical And
Three on Managerial

Side.

Going Back to the Tribal Inspector, Who Really Does ‑‑ Is That a Pet Who
Has Been Assigned

That as a Specific Responsibility or Is That Handled Differently in
Different Offices? What\'s Your

Experience on That?

Tribal Inspectors Are Usually Done ‑‑ Are Usually Associated With a
Cooperative Agreement or

A Contract under 638, and They Are Then Counted into the System Along
with Coordination

from the Tribe to Bring in Their Workmonths and Abilities to Perform
Inspections into the

Matrix.

So the Funding Is Not Coming From BLM but Actually Coming From Some
Other Entity.

No, it Is Being Funded by BLM In the Cooperative Agreements or 638
Contract.

We Have a 638 Agreement with The Blackfeet Tribe and We Have An
Inspector That\'s Fully

Certified for Production at this Point and He Does All the Inspections
on Blackfeet Reservation

and He Reports and Works with Their Great Falls Office. So They Work
Together on That

Inspection.

How Are These People Selected? Are They Selected by the Tribes To
Represent Them ‑‑ We

Don\'t Go Out for an Announcement or Something like this.

Yes, They Are Selected by the Tribe and Then They Have ‑‑ the Tribe Is
Responsible for

Getting An Experienced Person in There To Do this Work, and Then They
Have to Go Through

the Certification Program the Same As Our BLM Inspectors, but We Do
Monitor Their Work.

Okay. What If the Tribe Is Unable to Bring Somebody ‑‑ or Provide
Someone, Then We Do the

Work ‑‑

Then We Would Do the Work.

Okay. Thank You.

Moving on into Our Identification of Personnel, the Next Category We
Have to Identify Is the

Amount of Work They Are Going to Provide to Us Or Workmonths They Will
Provide To Doing

Actual Inspection Work And this Available Workmonth Column Here We Are
Going to Identify

Not Only Inspection Work. We Are Also Going to Identify The Overtime and
the Miscellaneous

Workmonths Associated with Each Individual. And One of the Things We
Need to Discuss about

These Areas, Particularly ‑‑ Well, All of Them, Actually, in the I&E
Inspection Work, on the

Average We Have about Six Workmonths Associated with Each Inspector.
That\'s on the

Average. That\'s Taking into Consideration We Have Some People That Are
Part‑time Inspectors

and Then on Up into Full‑time Inspectors. So the Average Is Six
Workmonths. That\'s Going to

Differ Greatly From Office to Office. You May Not Have Part‑time People
and You May Have a

Program Where Miscellaneous Is Only One or Two Workmonths Associated
with the Program.

You May Have an Amount of Workmonths in the I&E Section Being Upwards of
Eight or Nine

Workmonths per Each Individual Over Here and Then Only One Workmonth
over Here for

Miscellaneous. The Overtime Aspect Comes in Where You Can Give the
Amount of Overtime ‑‑

or Identify What the Needs of Overtime Are Through The Inspection Plan
Matrix. And this Gives

You a Real Good Planning Tool for Budget, Then, To Say, Well, I Need
this Amount Of

Overtime.

Can I Ask You a Question. In I&E Inspection Workmonths, Could You Speak
to Averages.

When We Have a Person with Full 10 Workmonths, Does That Mean They Will
Get 10 Full

Workmonths Of Work as They Apply to Inspections ‑‑

You Need to Take into Consideration They Are Not Going To Code Time to
Conducting

Inspections Where They\'re Not Conducting Inspections Such as Meetings,
Training, Anything

They Don\'t Do in Association With an Inspection Item They Are Not Going
to Document Time

for. So There\'s Going to Be Some Miscellaneous Workmonths for
Administration Purposes You

Need To Consider in Doing That.

Thank You.

So What Would Be a Good Average Again?

the Average We Start out With, We Are Using in this Example, Is Six
Workmonths.

Nationwide, Does That Hold Pretty Close?

Yes. That\'s Nationwide. It Holds Between 6 and 6.5.

and What Variety Have You Seen from Some of the Offices?

I Have Seen as Much as People Identifying 10 Workmonths per Person down
to Using Just 6

Workmonths. I\'d Have to Question Those That Are Saying They Are Going
to Devote 10

Workmonths, Because That\'s Just Not Possible at All. There Going to Be
Where You Have To

Attend Those Meetings and Training Courses and Things like That That Are
Going to Take Away

From Your Inspection Activities.

I Guess We Have Seen Offices Where the Number Rises Even Though the
Personnel Doesn\'t as

Some of the Grade Overgraded People Become More Proficient.

That\'s a Good Point. The People Coming up in Training And Things like
That Aren\'t Going to

Be Able to Devote a Lot Of Time to Conducting Inspections Because They
Will Be Going with

Other Certified People and Learning the Ropes, So to Speak. So You Are
Not Going to Get

Anything out of Them in Regards To Conducting Inspections for at Least a
Year down the Road.

but on the Overall of a Rim, If You Have Everybody Certified And
They\'re up to Speed, It\'s Still

Between 6 and 6‑1/2 Workmonths?

on a National Average. But it Will Vary from Office to Office. And the
Way You Can Determine

Is That to Review Your Airs Database and Pull the Amount of Hours They
Spend Doing

Inspections by Inspector and Then Calculate That into Workmonths.

Actually It\'s to Your Advantage to Go Back and Do it The Way That
You\'re Suggesting There

Because That\'s Indicative Of Your Situation Rather than Just Sort of
Artificially Creating a

Six‑workmonth and We Will Do it Because It\'s Simpler That Way.

Yes, Be Realistic You Can Do.

Use Your Own Situation. You Could Have Some People Dedicated to Fire
Effort or ‑‑ I Think

Some of Them Have Haz‑mat Responsibilities. So You Really Have to Look
at Your Own Office.

That\'s a Good Point.

Airs Is an Excellent Tool for Determining What Your Capabilities Are by
Person Because of the

Documentation Requirements for the Time.

Thank You.

Moving on into Our Inspection Plan Matrix Identifying Your Capabilities,
We\'re Going to Use

The 6 Workmonths per Person. The Supervisory of Person Is Going to Be
Spending Two

Workmonths. Travel Inspector 3. One Workmonth from 2 Individuals On the
Other. And Which

Gives You a Total of 18, and Then Your Natural Resource Specialist or Es
Person Will Be Able

to Spend Three Workmonths and Then Clerical Staff, You Have Three
Workmonths Being

Devoted for Support. Managerial You Have 6 Workmonths. One of the Things
I Want to Point

Out, When You Have a Spur Rise Pet over Here, a Lot of His Time ‑‑ Some
of His Time Is

Going to Be Included Here on the Managerial Side. So You Won\'t Have a
Full 10 Workmonths

Being Identified Here Under These Two Columns for the Supervisory Pet.
Getting into the

Miscellaneous, We Have 8 Workmonths Miscellaneous for the Two Pets. That
Adds up to 20

Workmonths, Divided by 2, That\'s 10. Those Should Come out Right at 10
Workmonths per

Inspector If They Are Full Time Inspectors. If They\'re Not, Then
Identify a Remarks Section ‑‑ in

the Remarks Section the Differences There. Now, in the Miscellaneous for
The Supervisory Pet Is

5, and You Will See That Adds up to 7 Here. So Part of His Time Is Going
to Be in this 6

Workmonths over Here for the Managerial Support ‑‑ or 3 of Them There.
Then the Tribal

Inspector We Have 2 Miscellaneous Workmonths, And Then You Don\'t
Account for Any

Miscellaneous Workmonths Under Other Because They Are People Coming in
to Help You out

In a Tight Situation. So You Have a Total of 15 Workmonths on
Miscellaneous. Now, on the

Overtime Aspect, You Have 2 Workmonths Here of Overtime for the Pets.
That\'s the ‑‑ to Catch

Your Drilling Abandonment after Hours. You Have One Workmonth of
Overtime for the

Supervisory Pet. And 0 for the Tribal, 0 for Other and a Total of 3. The
Nrs, He Can Do All His

Work During Normal Work Hours, So We Don\'t Account for Any Overtime For
That Person.

Now, What Will Happen Here Is When You Calculate This, Your Total Fields
Across the Bottom

Here and down this Side Will Automatically Populate and Provide That
Information to You. With

That I Think We\'re Going to Turn it over to Paul. I Think He May Have
Some Questions or

Faxes Coming In.

We\'ve Had Several Faxes Come In, Lonny, and Howard, Take Them In
Whatever Order That

You Have Them There.

Thanks. From Dennis Stinger in Cheyenne: We up Here Talked about
Updating And Changing

the Matrix and He\'d Like Us to Explain Better What On the Matrix Can Be
Changed?

Certainly Just about Anything Can Be Changed. You Can Change Your
Inventory, For Instance.

If You Have Plugging Operations Ongoing, an Increase, You Want To Change
Your Inventory to

Increase That. Same with Drilling or Environmental Inspections That May
Have Come up That

Were Unexpected. Certainly You Can Change Your Workload Capabilities or
Your Capabilities

to Conduct the Work Under Personnel. If You Lose a Person, You Are Going
to Have to Identify

That You Don\'t Have Enough Workmonths Now to Complete All the
Inspections. Under Table 6,

of Course, Is Going to Be Dependent upon What Happens on Page 2. We\'ll
Talk about That this

Afternoon. When You Have a Change in Inspection Requirements Such as
Plugging or Drilling,

That\'s Definitely Going to Change Your Capabilities in Table 6. So Just
about Anything Except

Probably Your Production Inspection Items Are Going to Change on That
Statement, and at

Mid‑year You May Have Some Fluctuation Also There, but We Don\'t Expect
Too Much of That

to Happen.

Okay. Thanks for That Question, Dennis. We Got a Couple More from Paul
Brown. When Will

the Washington Office Im Be Issued and What Are the Matrix Due Dates We
Have Talked

About?

One of the Things That Has to Occur Is That the National Policy and
Guidance Group Has to

Get Together and Talk about a Lot of Issues Related to the ‑‑ What
Inspection Is the Best

Inspection to Do, What Level Inspection Do We Want to Conduct? We Need
to Know Also Do

We Want To Establish a Production Level For Conducting Dpais. So,
Therefore, We\'re Trying to

Get That Committee Put Together As Soon as Possible. There Is Some
Logistics Involved In

Getting Everyone Together but As Soon as Those People Are Put Into a
Quorum and We Get a

Lot Of These Issues Worked Out, Then We Are Going to Have That National
Im Issued on the

Percentages of Inspections to Be Done or the Inspection Requirements.
Now, We Don\'t Expect

Anything to Be above the 10% and 33% Imhis. So We Are Kind of Figuring
Our Matrix Today

on the High Side Knowing it Won\'t Ever Get above That. It\'s a Little
Uncertain When it Will Be

Issued but However, this Will Be a Starting Point for All Your Offices
to Get Going and Get

Your Inspection Work Started. That Covers That.

Thanks, Paul. We Have a Series of Questions From Pat in Denver There,
and We\'re Taking

Those as We Can Here. He\'s Asking, They Need Clarification When to List
Activities for a Given

Type of Inspection and When to Lump Under One Activity. For Example, You
Do Six Cvs or Six

Separate Facilities Do You Call the Facilities Separately By or Do You
Code One Mp and List

Six Facilities.

That\'s a Very Good Question. We Find a Lot of Problems Associated with
That When We Do

Reviews of Our Inspection Work. The ‑‑ When You Are Doing a Detail
Production

Accountability Inspection, We Want to Know How Many Measurement
Activities You Have

Done. So If You Have Done Three Tank Gaugings and Four Meter
Calibrations, We Want You

to Document Those Separately Because They They Have Potential To Create
a Volume

Discrepancy And We Want to Know How Many Were Done and the Number of
Those That Did

Result in a Problem. Site Security Inspections, Surface Type Inspections
to Your General

Environmental Concerns Can All Be Lumped under One Activity Listing the
Number of Wells

and Number of Facilities That Were Inspected. So Just Keep in Mind That
We Want to Know All

the Measurement Activities That Are Conducted And Also You Can Lump the
Site Security and

Environmental Aspects. When it Comes to Production Records Reviews, You
Lump All Your

Records Review under the Pr Activity under Detail Production
Accountability Inspection. If a

Volume Discrepancy Did Occur under That Review, Then We Want You to
Break That Activity

Out and Put it Separately and Identify the Volume of the Discrepancy,
Either Gain or a Loss and

How Much Was Recovered. This Gives Us the Ability to Identify the Number
of Discrepancies

We Found as a Result of Our Inspection Work And Also to Give Us an
Accounting of All of

Those Types That Are Going On.

We Have Some Other Fax Questions but I Think We Will Let You Go Ahead
and Complete

Your Presentation There, Lonny.

I Think We Were Going to Stop Right at the End of Table 5 There. So I\'m
‑‑ I\'ve Completed to

That Point.

I Got Word to Keep Going.

Okay.

We\'ll Take a Couple More Here. Here Is a Question about Say the
Inspector Goes out and He\'s

All Set to Witness a Meter Proving Or Calibration but the Company
Doesn\'t Show Up. Is There

Any Way He Can Take Credit for That in Airs, That They Were There for
the Inspection Even

Though it Didn\'t Occur.

You Certainly Can\'t Take Credit for Something You Didn\'t Do, and Even
Though We May

Have Travel Time Incurred to Do That, If You Are Going to Go Back out
And Make Sure You

Witness That Activity, Then Bring That Also Into ‑‑ into the Time
Involved In Conducting That

Inspection. To Do a Tank Gauging and Not Have That Particular Person
There Is a Problem

Because We Really Didn\'t Do Anything. It Can\'t Show What the Results
Of Our Actions Were.

So, Therefore, Take Your Hours Into the next Activity That You Do When
You Come Back out

There. Anything Else?

You Have to Any More in Block 5?

We Have Pretty Much Completed Block 5 of Our ‑‑

How about the Overtime Aspect Of It, Lonny?

I Covered All of That.

If You Don\'t Mind, I Would Like to Ask a Question about the Overtime.
I\'m Not Questioning

What You Have Put in There with Respect To the Actual Numbers and We\'re
Talking

Workmonths. The Question That I Have Is from Administering the Overtime,
Are You

Administering it by the Individual or Are You Administering it by the
Office Even Though You

Filled out the Chart by the Individual? I Guess My Question Is: What If
The Overtime Doesn\'t

Materialize Where You Have it Planned. It\'s Certainly Not an
Entitlement by Any Means, but

How Do We Really Optimize the Use of That Overtime Without Compromising
What We Are

Trying To Accomplish out There.

You Want to Look at Overtime In the Sense of Being Able to Conduct Those
Those Inspections

After Work Hours, and That Mainly Relates Around Plugging Operations and
Drilling

Operations. Sometimes Offices Do Use Them For Production Also for
Getting Behind. They Will

Issue Overtime for That Also. But You Need to Manage Overtime. It\'s a
Very Sticky Issue, and

The Government ‑‑ in the Government These Days, and Go by That Basis and
You\'ll Do Just

Fine.

Thank You.

Lonny, I Don\'t Think We Wanted to Give the Wrong Impression, but We\'re
Get ‑‑ We\'ll Get

Some Feedback from You And Don on this. We Talked about the Matrix Is
Dynamic and it Can

Be Changed And Yet We Talked about Maybe The Priorities Don\'t Change
But, In Fact, Given

Some Circumstances out in the Field With an Operator, Couldn\'t We Be
Changing Priorities as

Well on An Item We Had Already Established.

Usually What We like to See For Accounting Purposes in the Airs Database
and Be Able Then

To Relate That Back to the Number of W, X, Y and Z\'s, We Would Rather
Not Have That

Change Because We\'re over to the Bean Counting Part of It. We Want to
Know If We Got All

Our Fogrma High Inspections. If We Are Changing Those Through The
Beginning of the Year,

We Can\'t Have a Good Count on How Many Were Actually Done. If They Were
All Covered. So

We Would Rather Have Those on The Production Side Stay Stable For That
Entire Year and

Then Change Them the Following Fiscal Year If it Needed to Be Changed.

So I Guess on Your ‑‑ Counting Your Inspections If You Do Have the High
Priority Production

or Abandonments, Would You Add That to the Database? It\'s Not Changing
the Priorities, but

What It\'s Do Something Changing the Numbers And Amounts. That\'s What
‑‑

You\'re Going to Have New Ones Coming in All the Time.

Right.

and You Could Have Operations You Didn\'t Forecast for. So You Are Going
to Have That

Strategy or Matrix Need to Be Dynamic in That Regard. Even on the
Production Side, You Are

Going to Have New Wells Being Drilled on New Leases and That\'s Going to
Have to Be Taken

Care of or Accounted for.

but in the Case of Say a New Apd Came in and Say It\'s Occurring in a
Wetlands, for Example,

or at Least near One, What Have You, the Previous Planning Really
Didn\'t Indicate That You

Might Be Having That Kind of a High Priority. What You Are Suggesting Is
You Don\'t Go Back

and Shift the Priority or I Guess it Becomes a High Priority and Would
it Show Up as a Demand

Item?

You Would Need to Look at That under the Drilling Aspect. That ‑‑ That
Would Come in

There, and You Would Have an Increase of the Environmental Factor. It
Would Show up ‑‑

Okay.

Don a Question Maybe for to You Start out with. We Have Had Several
Faxes Come In That

Talked about the Dilemma That That Pet Is In, That He Always Seems to Be
End up Being

Evaluated by the Number of Inspection Numbers He Completes And It\'s
Kind of a ‑‑ You Know,

We Always Talk about We\'re Interested in Quality, over the Numbers, but
That Guy Always Has

A Number Assigned to Him, and What\'s Your Experience with That And
What\'s Your Feeling as

a Manager in Terms of Those Numbers Versus the Quality and When it Comes
Time to Do Your

Performance Reviews, How Are You Doing That Balancing Act There?

I Think the Term You Just Used Is a Balancing Act. There Isn\'t a Good,
Clean Answer In My

Estimation as to How to Best Focus on a Number. What I Mentioned Earlier
Is I Don\'t Think We

Want to Try to Run the Program off of a Quota. There\'s Too Many
Situations out There That

Demand the Quality That\'s Necessary to Make the Program Work Properly.
If We Think of

Those Numbers as Targets, Part of the Work Plan Scheduling Target, I
Think That Serves at Best

as a Guide. Now, I Know That\'s Going to Have To Be Adjusted and There
Has to Be Dialogue

Back and Forthwith Manager and with the Individual, And That\'s Part of
the Documentation

That\'s Coming On, So That I Think the Biggest Thing Is, Don\'t Set a
Target That You Are Going

to Try to Meet and Hold Everybody Sort of Accountable to a Series of
Numbers in the Fourth

Quarter When You Started out Planning it In the First Quarter. I Think
the Real Dialogue Is

There Has to Be Communication on This and I Think There Has to Be
Recognition That the

Quality Is Being Built In, and If That Level of Dialogue Is Simply Not
Taking Place, We Need to

Spend More Time Either as the Lead Pet Or Actually Having Maybe the
Authorized Officer or

Area Manager or Whatever Actually Sitting down and Talk about Not So
Much Adjusting

Priorities but Adjusting Sort of Volume So We\'re Not Either Burning
People Out or Maybe

They\'re Not ‑‑ I Think Just to More. I Think Again That May Not Be a
Clear Answer but I Think

it Has To Be Logical and Purposeful in Terms of What We Are Trying to
Accomplish.

I Liked What You Said about Documentation. The Documentation, What\'s in
the Record, Is

Going to Answer a Lot Of That. We Can Send a Person out for a Plug Job
That Sounded Simple

and Looked Simple When We Sent Them And Four Days Later He Comes Back
Because That\'s

the Way Things Went. So That Documentation of What\'s Occurring and
What\'s Taking Place Is

Real Critical.

I Guess I Would Ask Lonny, You Have Worked with this a Lot More than I
Have. What Is

Your Experience in Terms ‑‑ We Did Try to Set Targets and Hold People to
Targets Originally

and There Is a Lot of Reasons Why You Shouldn\'t Do That.

it Puts Too Much Pressure on The Pet, for One Thing and What They Start
to Do Is Then Strive

For the Number and Not the Quality. I Have Been in Many Offices Where
the Quality Is Just Not

There but the ‑‑ They Got All The Numbers Done, but If You Got ‑‑ If You
Don\'t Have Quality,

The Numbers Don\'t Mean Anything. So We Have to Do ‑‑ We Have to Have
That Balancing Act

of Getting Good Quality Inspections. I like Your Comments about
Communication. That\'s the

Biggest Hurdle We Have to Get Over, Is Tell Your Supervisor, \"I Can\'t
Do That. If You Want a

Quality Job, We Can\'t Handle That Situation.\"

Bringing up the Word \"Quality\" I Understand What\'s Meant by the
Quality, Is That Subjective

or Do We Have a ‑‑ How Is the Technical Procedure Sort of Factored into
That? A Lot of These

Situations ‑‑ a Lot of These Conditions Really Are Different. You Are
Not Evaluating Everybody

Across the Board. You Have to Look at Kind of the Dynamics of this. What
Is Your Experience

on How To Best Communicate Not Only What the Quality Is but the Fact
That the Person That

Is Doing This Is Meeting Your Expectations.

a Lot of it Comes Back to Common Sense. If You\'re Doing Something and
You Aren\'t Doing it

Right, Then You Should Do it Right Instead Of Trying to Get to Those
Numbers. So You Take

the Common Sense Approach. Am I Getting Everything Done Here. Then You
Are Going to

Have Good Quality.

and You Have to Have That Oversight by Your Pet, I Think, Too. And it
Depends on the

Experience Of the Staff. But That Person, That\'s One of His Jobs, Is to
See That, Hey, Have We

Given this Person More Numbers to Accomplish than He Really Can? Were
There Other Factors

Involved?

Does He Know Everything He Needs to Know to Do His Job? Make That
Analysis. Does He

Have the Proper Training.

We Have Some People That Come In That Have Maybe an Excellent Background
in Drilling

and They\'re Certified for Production, but They\'re Not Quite up to the
Level of ‑‑ That Someone

That Came into the Reverse Set of Circumstances.

Right.

Everybody Has to Have a Role In That and That Lead Pet Is Real Important
in That Role.

I Appreciate That. Are There Any More Faxes at this Time?

I Think We\'re Going to Kick Her Back to Paul at this Point.

Well, I Imagine You Folks in This Part of the Country Are Looking
Forward to a Lunch Break.

We Are Going to Take a One‑hour Break at this Time, but Please Be Back
Promptly in One

Hour. We Will Again Be on Transponder 17 of this Satellite. We Will
Address Some More of

Your Questions after Lunch and You Won\'t Want to Miss Lonny\'s
Completing the Matrix and the

Conclusion of Our Telecast. See You Then!

Welcome Back. Hope You Had a Good Lunch or a Long Break, Depending upon
Where You\'re

Viewing. We\'re Ready Now to Finish Our Last Segment of the Telecast by
Completing the Rest

of the Strategy Matrix. We Still Have a Lot of Information to Cover
Before the Conclusion of

Our Broadcast, So We\'ll Get Right to It. Lonny, You Ready?

Yes, I Am. Welcome Back, Everybody. I Would like to Start off by Picking
up Where We Left

off. We Completed Table 5 of Your Matrix and We Are Going to Skip Over
Table 6. We\'re

Going to Show You Now a Blank Part of Table 6. This Will Be
Automatically Populated for You

When You Calculate the Second Page of Your Matrix. So Moving on from
There, over to The

Second Page of the Matrix, We Have the ‑‑ It\'s Kind of Hard To See at
this Angle, but Following

along in Your User Guide There in Your Own Matrix, You Can See There Are
Several Columns

Here and One of the Things We Are Going to Concentrate on to Begin with
Are The Average

Hours it Takes to Complete Inspections. I Also Want to Point out this
Has Two Categories of a

Number Of Inspections of the Required Column, Which Is the Number of
Inspections That Is

Required by The Washington Office or the Goals That We Have Set. You
Also Have the Plan

Column Where this Is ‑‑ Where You Have The Ability to Provide
Information to the District

Office or the State Office or Then onto Washington of What Your
Capabilities Really Are in

Meeting the Goals Outlined by The Washington Office. Down the Left‑hand
Side of the

Document There Is the Types of Inspections We Will Be Covering And
Putting Those into the

Matrix. We Have the Detail Production Accountability Inspections. Those
Are Identified by

Federal And Indian. Also Going to Number 2 Is Independent Measurement
and Handling

Inspections Which Is Also Broken down by Federal and Indian. We Would
like to Point out We

Are Going to Look at the Detail Accountability Production Inspections
and Also the Imhis. We

Are Also Going to Complete The Federal Section Only and Then the Rest
Will Be Pretty Much

Easy to Follow along on the Indian Side If You Have Any Indian
Inspections to Complete. The

First Part of That Matrix Is The Going out and Getting the Average Hours
it Takes to Complete

Those Inspections. You Should Have Went into Your Airs Database and
Pulled Information on

Reports 2 a and 2 B Which Gives You the Average Time. First One Is 2a,
Which Gives You ‑‑

Let Me Zoom out on this. First of All, it Gives You the Type of
Inspection That Was Conducted

Here and You Selected Any Number of Those of the Eight Types That Are
Available to Be

Conducted, and What the Inspection Count Was and Then The Office Travel
and Inspection Time

on Across with a Total Time. Again That Was in Report 2‑a. It Was Pulled
for the Fiscal Year of

Last Year, this Information Was, 950926 Through 0926 of 96. Which Was a
Full Year of Data.

Then You Take the next Report That Is Generated from That Is Report 2‑b,
Which Gives You

the ‑‑ Those Same Inspection Types Again, the Pa, Which Is the Dpai Or
Detailed Production

Accountability Inspection, the Ph, That Is the Imhi, and it Gave the
Count of 69 Performed Under

Pa and 164 Imhis Were Performed. You Take the Information Provided by
Both Those Reports,

The Time, and as You Can See, The Amount of Hours You Take the Amount of
Hours and

Divide it by The Inspection Count, and Then Determine Your Average
Inspection Hours. So If

You Put 2125 Here and Divide it by 69, You\'re Going to Get an Average
of 31 Hours to ‑‑ For

Conducting a Dpai. The Imhis, Then, We Had a Total Of 1200 ‑‑ 1266 Imhis
Completed And

You Divide That by 164, and ‑‑ Excuse Me, Took it 1266 Hours To Complete
164 Imhis and

That Will Give You an Average Time of 8 Hours on Those. Now You Take
this Information,

Then, to Your Second Page of Your Matrix, and You Enter, Then, the
Average Time it Took

You to Do Inspections. You Add 31 Hours for Dpais and It Would Be the
Same for Indian As it

Would Be for Federal, and Then You Enter the Average Hours For
Conducting an Independent

Measurement Handling/inspection Is Also Eight Hours. When You Are
Dealing with Indian And

Federal, Some Offices Pull Information Separately and You Will Have a
Different Time for

Conducting the Indian as You Duty Federal. That\'s Acceptable to Do
That. The next Step That

We Need to Do Is Determine from the Washington Office Guidance of What
Is the Number of

Inspections We Have to Do to ‑‑ Based on That Guidance. So We Are Going
to Come up with

Our Required Number of Inspections in this Column Here. For Both the
Dpai and the Imhis. If

You Follow along in Your ‑‑ The Packet May Be a Little Different than We
Have in the ‑‑ Up on

the Screen Today but They Should Follow along or Track Right along with
the Different Types of

Inspections We Are Going to Be Doing. First of All, We Need to Know What
Our Total Number

of Inspection Activity Is, and We Have to Then Equate That to How Many
Have Produced in the

Last 12 Months, and If You Remember, We Went into the Airs Database And
Using the Monthly

Probe Operations Also and Determined What Inspection Items Had Produced
in the Last 12

Months, And from That Information, in Our Particular Office, We Had 240
Iids That Produce in

the Last 12 Months. So We Will Enter into That Your Worksheet, Which Is
240 on the Top.

That\'s Your Total Federal Iids That Have Produced in the Last 12
Months. Now, Df Stands for

the Number of Required Dpais That Need to Be Done, and That Is Done in
Step 2. So to Do

That You Have to Have The 240 Brought down into Your Formula, and Then
You Take That

Times Your 10%, and Very Easy Calculation. That Leaves You with 24 Dpais
That You Will

Have to Conduct Over the Course of the Year. Now, These Can Be Done on
‑‑ Doesn\'t Have to

Be Done on Fogrma Highs. It Can\'t Split Between Fogrma High and
Non‑fogrma or Can All Be

Done on the Non‑fall Ma. But for Planning Purposes You Try to Work in
Your 24 Dpais That

Will Be Conducted. Now, Moving onto the next One After We Determine How
Many Dpais

We\'re Going to Do, We Have To Determine How Many Independent
Measurement/handling

Inspections We Are Going to Conduct and to Do That You Then Come up into
Step 2 of Your

Matrix, the Worksheet, and it Starts out with T Being Iids Assigned for
the Current Fiscal Year

Priority, and That\'s Your Total Amount. Now, We\'re Going to Deal Again
Only with the Federal

Side. This May Seem Confusing Slightly, but We Will Try to Explain That
Through. So There

Were a Total, If You Recall from Your First Table, Table 2 in the
Matrix, There Were 290 Total

Iids. That Was the Producing and Nonproducing Inspection Items. From Our
Other Exercise We

Just Went Through in Step 1, We Said There Were 24 Required Independent
Measurement ‑‑ or

Dpais. Excuse Me. So with That We Have to Then Determine the Number of
Imhis That Would

Be Required, and That\'s Ri. So You Take 290, minus the 24, Because You
Don\'t Need to Add

That into Your Process, That Will Just Require More Items to Be
Inspected than Necessary, and

We\'re Looking at 33% Here. So this 24 Subtracted from 290 Is Going to
Be 266. Again, If We

Have Any Problems Here, We Encourage People to Call in and Ask Questions
at Any Time.

We\'re Trying to Get You to Understand the Process and Be Able to Put
Your Matrix Together.

So Please Call in or Give Us a Fax at Any Time Here. 33%, Then, Times
266, That Requires 88

Imhis to Be Completed. So Now in Your Worksheet to Complete Your Matrix
the Ri Is The

Number of Required ‑‑ Iids Required on Imhi from Step 2 Is Going to Be
88. This Is Just for the

Federal Side. The next Step That We Have to Determine Is How We\'re
Going to Split Those 24

Inspection Items That Require Dpai over to Spread Among the Fogrma High
and the Non‑fogrma

and like I Said Before, this Could Be Split Between Those Two Types of
Inspections or All on

One Side. So Now We Have to Come in and We Take the Process and
Determine That Number

and It\'s Going to Be A Number That You Select on Your Own of How Many
of the Fogrma

Highs Are Going to Be Inspected. So Going into Step 3 of the Process, We
Need to Know the

Number of Federal Iids Required At Dpai, and That Was Df, Determined in
Step One Was 24,

And Now We Need to Know the Number of Federal Fogrma Iids That Are That
Are Going to

Require Dpai and That\'s Where We Come in Here and We Are Going to
Select for Our Sample

Office, We Are Going to Say 10. So Now We Know That 10 of the Fogrma
High Iids Are Going

to Receive a Dpai. That\'s Dff. So We Can Put That Number up Here. Now
We Need to Know

How Many of The Other Inspection Items That Are Not Fogrma High Are
Going to Require a

Dpai. So It\'s a Simple Math Calculation Again. 24 minus 10 Is Equal to
14. Now, Again, this

Goes into Your Worksheet and We\'ll Explain Where You Need to Put That
on The Matrix Here

in a Moment. Now, Moving into the next Area, After We Have Determined
That We Need to Do

a Certain Number of Dpais on on the Non‑fogrmas, We Then Have to
Determine the Number of

Imhis and How We Are Going to Spread Those Across the Board, Because Now
We Have 14 ‑‑

Excuse Me ‑‑ We Have a Number of High Fogrma Inspection Items That Have
Not Been

Covered Yet. We Have 10 Now So Far That Are Going to Receive a Dpai.
Now, There\'s a Total

of 46 ‑‑ Actually 56 That Are Going to Require to Be Inspected on the
Annual Basis from Our

Database, If You Refer Back to Table 2. If We Go to the Step 4 Now, We
Are Going to

Determine at this Point the Number of Those Iids That Are Going to
Require an Imhi on the

Fogrma Highs. To Do That We Need to Know a Dff ‑‑ What Dff Was and
That\'s in Your

Worksheet There, and That Was the Number of Detailed Inspections on
Fogrma Highs, Which

Was 10. We Need to Know What Ri Was, Which Was the Required Number of
Independent

Measurement/handling Inspections and That Number Was 88. So Now We Need
to Determine

from That the Number of Iids That Are Going to Require an Imhi in the
Federal Fogrma Highs.

So We Need to Take Our W and X\'s From the Matrix and There Is 26 W\'s
‑‑ These Are Fogrma

Highs ‑‑ And Then There Was 30 X\'s from The Table 2 in the Matrix, and
Then We Need to

Subtract Those That Are Going to Require ‑‑ or Going to Have a Dpai
Conducted On Them,

Which Was 10. So That Leaves Us with a Total Then Being 56 Inspection
Items That Are High

Fogrma. We Need 46, Then, That Would Require an Imhi to Be Conducted On
Those. So There

Would Be 46 Iids or Fogrma Highs That Would Require An Imhi. To Finish
out on Step 4, We

Need To Determine What Iid Is. Id Is the Number of Iids Requiring a
Discretionary Imhi. When

We Talk about Discretionary, You Can Spread That Across All of Your
Inspection Items, Select

Those That Have Not Been Inspected Recently and Conduct an Imhi. Those
Are Discretionary.

You Can Select Those on Your Own. To Do That We Need to Go into a Step
4, the End of It,

and We Need to Know That There Were a Total of 88 Required Imhis. So
That\'s Ri. And Then

We\'re Going to Subtract The Determination of A, Which Are the Remaining
Fogrma Highs That

We\'ve Already Done. So We\'ll Subtract Those out. Which Is 46. That\'s
Going to Leave with Us a

Total of 42 Iids Requiring a Discretionary Imhi. So Then You Bring That
over into Your Table

and Put 42 into Here.

Lonny, We Got a Fax in That This Might Be a Good Time to Address it
Right on this Point. The

Comment and Question Is: on Page 11 of the Telecourse Manual It States
under the Imhi

Discussion That We Are to Conduct an Imhi on 33% of All Remaining
Producing Iids. The

Formula on Page 16, Step 2, Uses Total Iids Producing and Nonproducing.
So When You Go

Through That T Minus the Combination of Df plus Di Times 33% Equals Gri,
the Comment Is

Maybe Page 11 Should Say Producible Iids.

That\'s a Good Comment and Probably What We Need to Do Is Change That
Wording. But

There Are Two Definitions in The Strategy Itself on Producing And
Nonproducing, and the

Matrix Alludes to Those That Have Produced in the Last 12 Months, And
the Other Producing

Category Is the Regulations Definition on Producing, and That\'s ‑‑ and
‑‑ And That\'s Capable of

Producing Being Quantities. So All of Those Add In. That\'s Where You
Have ‑‑ You Take Your

Database and You Eliminate All a and I and That Is Now You\'re Capable
of Producing Inspection

Items.

That Was a Great Comment from Dawn in Rock Springs and We Appreciate
That. Thanks.

Any Other Faxes There?

I Think We\'ll Let You Move Forward and Then We\'ll Get to Some.

after We\'ve Gone Through this Step and Identified Those Inspection
Items, We Can Turn Now

to Our ‑‑ Let Me Find it Here. Our Matrix and Show You Where Those Go
In. This Is the ‑‑ to

Show You These Numbers, and We\'ve Gone Through These Four Steps, We\'ll
Put These down in

a Sequence So You Can See Where They All Fall into Place. Now, We Had T
Being Iids

Assigned for the Fiscal Year. There Were 290. Again, this Is the
Producing and Nonproducing

Added Together from The Matrix and the Definition We Just Talked about.
Those That Have

Produced in the Last 12 Months, Tf, Are 240, and This Is How this
Information Will Look on

Your Sheet When You Complete It. Df Is the Number of Federal Iids
Requiring a Dpai. That Was

10%. There\'s 24 There. Dff Are the Number of Fogrma Highs That Are
Going to Have a Dpai on

Them. And Then the Remaining Fogrma High Iids ‑‑ or Dpais on the Federal
Iids Is Subtracting

the 10 from 24, Which Is 14. Ri Being Your Required Number of
Independent

Measurement/handling Inspections Is 88. And You Have 46 Required or
Remaining Fogrma

Highs That Need To Be Inspected. That\'s Going to Be with an Imhi. Then
You Have 42

Discretionary Imhis That Need to Be Completed. Now, this Is Again Based
on the National Goals

of Conducting 10% Of Dpais on Those Iids That Produced in the Last 12
Months And Then 33%

of the Remaining Iids Have an Independent Measuring/handling Inspection.
Now We Will Take

That Information and Put it into Our Matrix on the Second Page and
We\'ll Show You Where

That Fits In. We Show on ‑‑ We\'re Going to Put That Information Here
and Show You a Little

Bit Where Those Definition ‑‑ Those Abbreviations Come In. Dff, of
Course, Is the Number of

Federal Iids Requiring a Dpai. Right Here, That\'s the 10 That We Put in
There. And the Dfo Is

the Remaining Number of Dpais That Need to Be Conducted. And a Is the
Rest of the Fogrma

Highs That Weren\'t Taken Care of Up Here Need to Have an Imhi and Then
There Is the

Discretionary Imhis Conducted Here as Id. That\'s Where They Fit In. So
Your Matrix Then

Would Look Like this. To Show You Those Inspections, How They Would Fit
in There. Then

Moving on into the next Category, as You Do with the Drilling, the
Abandonment, Workover and

Environmental Operations, Then You Would Just Document Those in the
Required Columns

Also into the High and Low Priority. You Notice the Matrix Changes at
This Point. Instead of

Saying Fogrma and Other up Here, Because Those Relate to Production
Activities, It Says High

and Low Based on Your the Rest of Your Inspection Activities You Will Be
Doing or Types of

Inspections. So That\'s a Real Distinction to Make So You Don\'t Get
Real Confused When You

Start Talking About Drilling. It Isn\'t Really Fogrma. It\'s High and
Low. And Also with

Abandonment Operations. But You Would Bring That Information Also over
from Your First

Page and Where You Have All Your High Priority Drilling, You Enter That
in the High Priority

Category and So on and So Forth down Through the Plugging, Workovers and
the

Environmental Aspects. A Note to Make on the Environmental Side Is That
You Have to Go in

and Add All Those High Environmentals Together Such as for the ‑‑
You\'re Going To Look at

Your High Priority Drilling, Production and Abandonment, and Then Add
Those Together, and

Those Numbers, There Were 20 High Priority on The Drilling and 50
Production And Then 30

Abandonments That Were High Priority, Which Gives You a Total of 100
Inspection Items. And

When You Put That onto Your ‑‑ I Don\'t Have an Overhead of It, but When
You Put That on

Your Matrix, It\'s the High Priority Is 100, and Then the Low Priority
Is 0 Because We Don\'t

Require Any Low Priorities To Be Done at this Time.

Excuse Me, Lonny. I Won\'t See Them Having Trouble Following. I Am
Following What You

Are Doing. But the Question I Have Had, and I Have Had Mentioned to Me,
the Proposed

Strategy Is 10% All Dpais. Is That Those That Meet the Fogrma Thresholds
or High Priority or

for All Iids? Can You Ground Me a Little Bit In That.

.

It\'s Based on All the High Priority ‑‑ Excuse Me. Based on All Iids.

It\'s All Iids, Then?

That Produced in the Last 12 Months. You Make Your Calculation Based On
That. It\'s Not

Equated to the High Fogrmas. Only ‑‑ to Everything.

Okay. That Helps. Because I Guess the Concern Was If it Was Just the
High and You Were

Doing 10%, That\'s a Substantially Different Number Than If You Look at
All of Them.

We Had Conversations with the Internal Revenue Service ‑‑ must Be Going
to Get Audited

Here ‑‑ With the Ig\'s Office and Gao and Those Folks and Even
Internally That Maybe We

Should Set a Production Level and Received Several Faxes to That Regard
on Whether or Not

We Should Establish Some Production Level Where Dpais Wouldn\'t Be
Conducted, and We

Discussed That Earlier this Morning Some, and The National Policy and
Guidance Group Is

Going to Be Looking at That, and Seeing Where ‑‑ If That Would Best Fit
into the National

Overall Program.

What Do You Think ‑‑ What Are You Thinking about Going into That Meeting
as Maybe a

Level That Would Be Appropriate \'Use ‑‑ to Use? What Production Level
Is Being Tossed

Around.

We Looked at Initially like Using 100 Barrels a Month of Oil Production.
If it Falls below That,

You Wouldn\'t Conduct a Dpai Unless You Had Found a Problem Conducting
an Imhi on One of

Those. That Again Is Always Taking into Consideration Percentage of
Participation That We

Would Have, Either the Tribes or the Federal Government. It\'s All
Equated into That. And If It\'s

More than 100 Mcf ‑‑ Or 100 Barrels, Then We Would Consider That as
Going into That

Category.

and If Odd Mixture, Then You Would Fill on out Your Strategy With Ones
That Were under

That Threshold, I Guess? Or Pick from Some Other ‑‑

Usually We Would Base the 10% On Those That Would Be above the 100
Barrels a Month. So

Once You\'ve Gone and Rotated In 10 Years, Basically, as an Example, You
Have Rotated

Through All of Them, Then You Would Just Basically Start over ‑‑ or If
You Found a So‑called

High Maintenance Operator, Then You May Want to Do a Dpai on Those
Particular Individuals

Also. Regardless of Whether or Not It\'s below 100 Barrels or above 100
Barrels. So You\'re

Always Going to Be Rotating Through That Process.

Now, I Understand That this Is Just the Strategy Where We Are Right Now.
That\'s What\'s

Proposed. There Is Still Going to Be Additional Discussion on That. The
Question I Had, If You

Had An Older Field, in Many Cases You May Simply Not See That Level of
Production. You Are

Still Going to Be Expected to Do at Least 10% of The Iids ‑‑ I Should
Say the Dpais for That

Field, Say, for An Example, Regardless ‑‑ I Wouldn\'t Say Regardless of
Production, but Taking

Production into Account but it May Not Reach the Thresholds ‑‑

it May Not Reach Your Thresholds. If You Have an Area Office That Has a
Lot of Low

Production, Maybe Could You Lower That a Little. There Are Some Problems
That Could Occur

That You May Not Catch on an Imhi Also. So it May Take a Lower Standard
For You to Have

Enough Dpais to Know Whether or Not Everything Is in Compliance.

but the Real Impetus Behind This Is the ‑‑ I Won\'t Say the Pressure,
but the Focus Coming

From the Ig\'s Office and the Auditors Looking at Our Overall Production
Program?

Some of it Is and Focusing on Ig and Another Is Focusing on Ourselves.
We Are Looking at

Always Streamlining. We\'re Trying to Work Those Issues into the Policy
and Guidance Group to

Where They Take Those Issues, Then and Run With Them and See If They
Work Or Not. So

We\'re Continually on Our Own Reviewing Our Own Processes.

Again, this Is a Target. So a Given Situation in Your Capability Within
Your Staff Is Going to

Have to Be Adjusted Accordingly So You Can Meet the Intent, the Spirit
of That but The

Numbers Might Not Come out Exactly to 10%, but That Can Be Documented
and That Can Be

Passed along as to the Circumstances?

Right.

I Think this Is a Good Thing That Those People in the Field Can Really
Pass along to Their

State I&E Coordinators So They Can ‑‑ That Can Be Brought to The
Attention of Your Group.

Because this Issue Always Draws A Lot of Attention, What We Really Ought
to Do and What

Level Do You Set it At, and Some Of Them Are Going to Have to Juggle it
Because They\'re

Going To Have Some That Don\'t Meet That Threshold. So There\'s Always a
Pretty Lively

Discussion When We Get to This ‑‑

You Get into Workload as Far As People. If You Leave it 100 Barrels a
Month, Well, Those ‑‑

They May Not Have Much Production, So Do They Need the Staff They
Currently Have. There

May Be Some Juggling of People Around. Or Maybe You Need to Take a Look
At What the

Real Program Is, and There May Be Other Activities They Can Do, Too.

of Course, It\'s a Deterrent, Too. I Mean, That\'s Part of What We\'re
Accomplishing out There,

And Sometimes the People We Have The Most Trouble with and That We End
up Having to

Spend a Lot Of Our Time with Are Those Low‑production Operations, Too.
So ‑‑ It\'s Just

Another Factor That Goes into That Mix.

Low Production Fields Are Actually a Higher Maintenance Field Because of
‑‑ There\'s No

Money There to Really Keep Things up to Snuff, and They\'re Working on a
Very Limited Budget

Themselves, the Operators Are. Sometimes it Takes Even More Active
Program in Those Cases.

Thank You. Where Was I? Okay. The next Portion We\'re Going to Get into
Now Is after You

Have Filled out All Your Required Inspection Activities and Then You Go
into the Database and

Into Wordperfect and Hit the Calculate Function on Your Computer, and it
Will Give You Then

‑‑ Calculate into Table 6 Of Your Matrix. It Will Give You a Comparison,
Then, We Said That

Table 6 Was Going to Be Automatically Populated for You, and this Is How
it Would Look in

Doing That. Now, You May Notice That the Information We Have Here in the
Bottom in Table 6

‑‑ Let Me Zoom This up Here So We Can See ‑‑ Are Quite a Number More of
the Dpais and

Imhis That We Had Talked about Doing the Federal Side and That\'s
Basically Because this One

Has Also Included the Indian into this Required Number of Inspections To
Be Completed in

Block 6. So You\'re Going to See That Across There We Didn\'t Take That
Out Because We

Wanted to Show You this Complete Office, How it Compared to What We Have
to Do And

What We Can Do as the Resources. These Are the Number of Workmonths That
Would Be

Associated with Conducting These Inspections, Straight Up, and We\'ll
Let You Know What

Workmonths Needed to Do Those. The Main Thing We Need to Look At in this
Exercise Is a

Comparison Now That it Takes Almost 20 Workmonths Here to Complete Our
Inspection Work.

That\'s on the Required Side. What We Need to Compare to Is The Amount
of Workmonths

Available to Us up Here in Table 5, Which Was 18 Workmonths of
Inspection Capabilities. So

Using this 18 Workmonths and Comparing it down to the 19 Workmonths
Required, There

Seems To Be Somewhat of a Shortfall. However You Should Also Take Into
Consideration the

Amount of Overtime That Is Also Available To You, Which Is Three
Workmonths. So Adding

These Two Together, You Have a Total of 21 Workmonths Available to
Conduct Inspections.

Those Are ‑‑ Those Overtime Workmonths Are Going to Fall Into the
Plugging and Drilling

Activities Mainly for Those‑hours Work and on Night, Things like That.
So If You Look at This,

You Have 21 Workmonths Compared ‑‑ Available Compared to Almost 20
Workmonths

Required to Complete Your Work.

Lonny, I Have a Question from The Management Standpoint. What If There
Is Quite a Bit of

Disparity Between Your Capability and What You Ought to Be Doing Because
You Don\'t Have

The Depth in Your Staff in Do You Try to Reconcile That or Just Do ‑‑
Maybe You\'ll Get into

This. How Do We Make That Link‑up? How Do We Match That Without Going
Elsewhere for

Resources.

If There Is a Wide Disparity In Such That You Have a Shortfall, You
Don\'t Have Enough

Workmonths to Complete All Your Required Inspection Activities, There\'s
a Couple of Things

You Can Do, of Course, Depending on The Size of the Shortfall. Can You
Plan to Hire More

People. You May Have a Shortfall That Particular Year. Didn\'t Quite
Meet All Your Inspections,

but ‑‑ If You Were To Then Set into a Function of Hiring Additional
People, Then You Could

Bring Those People on Board and Get Them Trained up And the Following
Year You Would Be

on Board. Or You Could Give More Overtime, Allocate More Overtime into
the System So That

You Could Get Those Inspections Done Without Hiring Additional People.
Or Otherwise You

Can Also Go in And Leave the Shortfall and Say, Well, the Washington
Office Says This Is My

Budget ‑‑ this Is My Workload, These Are My Capabilities, and Maybe the
Washington Office

Then Needs to Look at Maybe Considering Taking Away Some of Those
Inspection

Requirements or Loosening up on Them.

I Guess What I Was Wondering Is, it Appears, and I\'m Kind of Seeing it
from a Distance Here,

But it Appears That the Strategy Seems to Be Increasing Our
Responsibilities out There but The

Reality of Either Downsizing Our Inability to Refill Behind Positions or
the Difficulties

Associated with That Puts Us in A Conflict Situation. I Think It\'s
Important to Understand, Yes,

There Are Some Options We Can Exercise but We Need to Understand How
Realistic Those Are

and I Think When We Make These Submissions Back to Washington, We Ought
to Be Realistic

into Terms of Our Actual Capability and Not Hope The Shortfall Will
Bayless out.

and That\'s Part of Our Policy Group Can Look at That. That\'s an Issue
They Can Take Care Of.

Back to the ‑‑ Back to the Threshold for a Minute, I Guess There\'s
Another Point I Was

Thinking about. For the People Watching This, They\'re Trying to Get
Their Matrix Filled out for

\'97 and Trying to Get Rolling with That, And We\'re up Here Talking
about How the I&E Group

That Has the Strategy Hasn\'t Met Yet, and it Seems to Me, the Thought I
Would Have on That,

If They Plan for The 10% and to the Extent They Can, They Do the
Inspections on Those Items

Greater than 100 Barrels per Month, That That Will Afford Them the
Greatest Protection

Towards Getting Caught in Between with the \'96 Strategy Said Versus
Whatever Changes You

May Make in the \'97. Do You Have Anything to ‑‑

That Was One of the Criticisms That Ig Gave Us a Short While Ago. They
Haven\'t Issued Their

Final Report Yet, but They Did Criticize Us That We Were Conducting
Detailed Production

Accountability Inspections on Not Only Low‑producing Iids, Which They
Felt Was Not

Economical, but Also Inspection Items That Had No Production. Why Are
You out There on

Those Particular Inspection Items? It Doesn\'t Make Sense to Do a Dpai
and I Had to Agree with

Them. It Doesn\'t. So My Advice Would Be That, Is Concentrate on Those
That Are Greater than

100 Barrels per Month, First Initially, Anyway, Conducting Your
Inspections and You Should Be

Okay.

If They Start out with That Being Part of Their Strategy, They Still
Might Figure Their Strategy

out on the 10% Thing But Keeping in Mind the Production Levels and the
to the Extent They

Can per Site in That Direction Because Whatever You Guys Come up With,
it Isn\'t Going to Be a

Greater Number. It Should in Fact Reduce the Overall Number They Should
Have To Do

Between 100 Barrels a Month and 10%.

Yes. That Comes from Just Looking at The Program, Too, Just on a ‑‑
It\'s Not Really a National

Policy Right Now, but We\'re Looking into Some of the Things, And That
Could Be

Accomplished Very Well That Way.

I\'ve Got a Fax from Greg in Pinedale. I Think It\'s on One of These
Same Points. With Your

Example Strategy, You Only Get to 56 Low Fogrmas in a Year or 168 in
Three Years. You Have

234 Low Fogrmas. Doesn\'t the Strategy Ask Us to Get to Every Iid in a
Three‑year Cycle?

Yes, it Does, and If My Calculations Are Wrong, I Apologize. I Thought
They Worked out

Okay In the System.

So If There\'s a Disparity, It\'s Just by Way of the Example That We
Tried to Illustrate Rather

than Intentionally Trying To Say That We Wouldn\'t Still Get to
Everything Within a Three‑year

Cycle?

Yes.

Okay.

Sorry Again If ‑‑ I\'d Have to Go Back and Check That, but I Don\'t ‑‑ I
Don\'t Know How the

Disparity Came about. From this Point, Then, What We Can Do, and We Have
the Workmonths

of Required Inspections, and We Know How Many Workmonths We Have
Available to Do the

Program. What We Can Do Now Is Determine How Much We Want to Do or Plan
To Do for the

Year, and What We\'ve Done with this Particular Exercise Is That We
Didn\'t Plan For Any More.

We Don\'t Have a Completed Table 6 for You. But We Left a Workmonth a
Cushion in There in

Case Some Things Came up That Were Unexpected, and We Had a Little Bit
of Time to Do

Other Things. So We Have Just Left it at 19.74 Workmonths Required. You
Also See That There

Are a Number ‑‑ Excuse Me ‑‑ There\'s 2.3 Workmonths Needed to Do the
Environmental

Inspections. You Look at the Required ‑‑ the Workmonths Available for
the Nrs, this Category.

He Has 3 Workmonths Available. So We Can Complete All of Our
Environmental Inspections

Here That\'s Going to Take 2.3 Workmonths. It Also Brings out Record
Verification and

Undesirable Events or Planned Inspections, And There\'s 24 Planned and
We Forecasted Maybe

14 Undesirable Events to Occur. It Also Gives You the Amount of
Workmonths to Do Those.

Those Are Also Again in the Plan Column on Your Matrix. As They Come
Across Here, this Is Is

Planned Workmonths, These Are Required Workmonths There. So We Aren\'t
Planning to Do

Any Additional Work than What Is Required by the National Requirements.
We\'re Going to

Leave this Inspection Plan Matrix the Way It Is and Then Submit it in
That Regard. So If We

Have Any, like We Say, Influence of Other Activities, We Can Take Care
of Those.

What Happens If You Have a Big Shortfall? Again, How Do You Reconcile
That?

If We Show a Big Shortfall, Again, You Go over into the Planned
Activities, and When You\'re

Looking at the Planned Inspections, and Let\'s Say You Weren\'t Able to
Meet All of Your

Fogrma\'s, or Let\'s Say All Your Dpais, the First Thing That You Should
Concentrate on Is

Completing All of Your Fogrmas, And ‑‑ I Lost My Sheet Here to Get the
Number of Those.

That Suggests If You Really Did Have a Shortfall, That May Be All
You\'re Doing and You

Wouldn\'t Have a Complete Balance In the Program, a Balance from The
Standpoint of Covering

a Wider Range, Right?

Right. Then You Come in Here and Say, I Know I Have to Do All My
Fogrmas, and They\'re in

the Plan Column and the Required, and the Remaining Fogrmas down Here on
The Imhis like

this. You Know You Have to Do All Those. So You\'ve Got Some Room to
Play In These

Numbers Here That You Put in for Your Other Inspection Items, Nonrelated
to Fogrma. They

Are Related to Fogrma but Not Fogrma Highs. So You Have Room to Play in
These Categories.

You Can Maneuver Through Those And Come up with an Inspection Plan What
You Can Meet

That Year.

Okay. Thank You.

Lonny, Just to Take a Break From That for a Second, with the Time Frame
We Have Left, this

Would Be a Good Time for the Field Offices to Be Submitting Their Final
Questions or Faxes. So

If There\'s General Questions Or If There Was Something That You
Submitted That We Still

Haven\'t Answered, Possibly You\'d Like to Resubmit That. I Have a Few
Faxes Left That We\'ll

Hit When Lonny Is Totally Done, but with the Time Frame We\'re Under, If
You\'ve Got Some

Leftover Questions or If We Missed a Point, this Would Be a Good Time to
Be Sending Those

Faxes out to Us. And That Sure Applies to the Phone. We Would Love to
Hear from Some

People on the Phone as Well. Some of the Comments That We Received Were
More in the Form

Of Information That Will Be Valuable to That I&E Group, and So
Specifically We Won\'t Be

Going Necessarily Through General Comments That Relate to Suggestions to
Modifying the

Strategy, but We\'re Giving Those To Lonny to Take to That Meeting And
‑‑ as Well the Field

People Can Feed That Kind of Information to Their State I&E
Coordinators. So Please, If You\'ve

Got Some Calls, If You Have Some Unanswered Questions, Please Give Us a
Call or Submit

Those Faxes.

Thanks, Howard. The Last Item I Would like to Cover Would Be the Remarks
Section of the

Matrix. This Is Designed ‑‑ Actually It\'s Remarks and Other Special
Conditioned. This Area Is

Used to Demonstrate To the Washington Office Maybe Some Concerns That
You Have in

Completing Your Inspections and This Is Where You Want to Remark On the
Shortfalls or

Identify Why You Selected Certain Inspection Types over Another, And
Also Special

Considerations Such as Things That Come to Mind. You Have a Lot of
Privately‑acquired Leases

That Require Different Flavor Inspection Activities. Maybe You Have Some
Concerns There,

You Have Some Concerns Related to Drilling Activities. Concerns Related
to Personnel

Shortages and Things like That. So on the Last Page, Page 3 of 3 Of the
Matrix, There Is a

Remarks Section, and I\'ll Zoom Out Here. The Remarks Section That Gives
You That Capability

to Document Anything That You Would Want the Washington Office to Know
or Your District

Office and on up To the State Office of Any Remarks and How You
Calculated Your Particular

Matrix, What Considerations You Made and Any Other Special
Considerations Such as Those

We Explained of Shortage of Personnel and So on And So Forth. With That,
I Have Pretty Much

Completed the Matrix. I Hope it Was Helpful to You in Developing Yours
and Answering a Lot

of Your Questions, And, Again, like Howard Said, If Any Questions Do Lie
out There, We

Would like to Hear from You.

Lonny, I Would like to Go Back to Question, and Maybe It\'s Because We
Didn\'t Fill it In, And

It\'s on the Inspection Accomplishments, That Particular Section. What I
Am Responding to

There, We Did Fill out the Required Inspections, and Then it Also Had
Planned Inspections, but

We Didn\'t Make Any Effort to Fill Those out at this Particular Time. Is
That a Calculation That Is

Actually Done Through Wordperfect or Is That Something That We Address
in Going Through

That.

the Plan ‑‑ That\'s a Good Point. The Planned Inspections Are Those That
You Can Accomplish

Through What Your Workload Capabilities Are. On You Are Analysis We Had
Shown It Took

21 Workmonths That We Had Available and it Took 20 Workmonths to Do All
of Our Work.

Well, in That Regard in Our Planned Column Was Going to Remain the Same.
But If You Have a

Difference There, Let\'s Say You Have More Work than What\'s Available
than Need Be to Take

Care of the Program, Then You Can Go in and Plan for More Inspections to
Be Done. It Could

Be More Dpais, it Could Be More Independent Measurement/handling
Inspections, More

Drilling, Abandonment, If You Have Any Low Priority in Those Areas. You
Can Just Tell Your

District You Are Going to Do More Things Out There than What You\'re
Required to Do, and

We Touched On the Shortfall Aspect, That We Would Adjust Different
Aspects Of Our

Inspection Requirements To Meet What We Could Actually Do out There. And
That\'s Some of

the Flexibility That\'s in It, Is That You Can Adjust Any Number Of
Those. Only Thing You

Would Have to Be Aware Of, You Have to Do All Your Fog My Highs, High
Priority Drilling,

Abandonment, Environmental and Then on the Others, You Can Cut Away at
Those and Not

Have to Do Them.

Thank You.

Lonny, Do You Have Anything Else to Finish up There?

That Pretty Much Concludes The Matrix Portion of It. I\'ll Turn it Back
to You.

Okay. I Do Have Some Faxes That We Can Proceed with and We\'re Hoping
That If There\'s Any

Remaining Questions That People Will Be Calling Those In. We Had a
Question from Nell in The

Buffalo Resource Area If We Are Hit Again with a Furlough, What Are We
Going to Do about

That in Terms of How it Affects The Matrix That We Come up with? And I
Think That\'s a Real

Good Example of How the Matrix Is Just Going to Have to Be Adjusted If
We Lose

Workmonths Through Something We Can\'t Control. Anything Else on That?

That\'s a Prime Example of Where We Could Adjust Our Strategy, Is That
If We Do Run Into a

Furlough or Some Reason Why We Can\'t Do Inspections, Then Adjust That
Strategy to Say We

Are Not Going to Be Able to Complete the National Goals and Send it on
up the Line.

Okay. We\'ve Got an Overtime Question From Fred in Casper, and He Is
Saying That We\'re Kind

of Giving The Impression That Overtime May Be Used to Complete
Production, Environmental

and Drilling Inspections as Well as the Afterhours Drilling and Plugging
Things We Can\'t Really

Control, And Does One of You Have a Perspective on That, the Use of
Overtime?

in My View of Overtime, It\'s A Real Good Workhour Tool to Get Things
Completed, and You

Can ‑‑ If You Are Running Behind on Getting Production Inspections Done,
Then Certainly Go

Ahead And Use Overtime to Do That. If It\'s Necessary to Do. But the
Real Advantage of

Overtime Is That Nighttime Work On Drilling and ‑‑ Drilling and Plugging
Operations. That\'s

Where You Can Utilize to That Ensure You Are Protecting Those Resources
out There, and I

See That as a Great Value.

I Guess I Also See Opportunities with Overtime, Particularly If You Do
Have Shortfalls, and

Let\'s Just Say In Light of a Short‑term Duration Before Can You Bring
Somebody Else on

Board, or Quite Frankly, Maybe You Aren\'t Able To Hire a Permanent
Full‑time Kind of Person.

I Would Hate to See the Program Where It\'s Actually Dependent Upon
Overtime to Meet the

Inspections That Are Required. On the Other Hand, I\'d Also Hate To See
That We Used

Overtime for Production and Ran Out, Say, in The Fourth Quarter and
Simply Didn\'t Have the

Resources Available to Us to Meet, Say, High Priority Drilling or
Abandonment in That Fourth

Quarter. So ‑‑ There Isn\'t an Easy Answer To the Overtime‑related
Issue, But I Think the

Wisdom Has to Be Of Keeping Track of What You Have and Actually Managing
That ‑‑ I Think

Rather Religiously in Terms of How You Use That Overtime. If the
Situation Warrants It,

Absolutely, We Should Use That Overtime. But I\'d Hate to See Us Become
Dependent upon it

from the Standpoint of Getting Our Regular Production Work Done at The
Expense of Maybe

Not Having The Money When You Needed it Later O So That\'s Just a Word
of Caution, I Guess,

from Me.

it Certainly Takes Some Monitoring to Make Sure You\'re Getting Things
Done That Need to Be

Done.

I Have Kind of a Comment and Perhaps Question from Al up in Worland, and
I Don\'t Know If

This Came in since We Hit on it Briefly or Not, but It\'s Still a Valid
Point. Worland\'s Raising the

Concern That They\'ve Been Working to Get Their Matrix for \'97 Done and
Yet at this Very, Very

Late Date We\'re Still Talking about the Percentages Changing, and
That\'s Why We Made That

Comment That If You Proceed with Your Strategy On That 10% and Try and
Focus on Any of

Your Inspections That Involve over 100 Barrels per Month, That it Might
Insulate You a Little

Bit from Any Changes That That Strategy Team Makes. But I Believe That
That\'s Something

That That I&E Strategy Group Really Does Need to Take Into
Consideration, Is That Hopefully

in the next Few Years That Team Can Meet Sooner in the Year So That If
There Is Going To Be

Any Modification, it Can Happen So That the Districts and The Field
Offices Have a Chance To

Know Going into this That Something Is Going On.

It\'s Been Difficult to Get That Team Put Together and Get Those Things
Kind of Ironed out

And Logistics and Funding for The Team and Things like That Had to Be
Worked out.

So We Appreciate That Comment From Al and I Am Sure a Lot of The Field
Offices Are

Thinking That Same Thing, That It\'s ‑‑ It\'s Real Late. So ‑‑ to Be
Making Changes. Hopefully

from What We Have Talked About, That Will Give You Some Tools to Try and
Manage Around

That. We\'ve Got a Phone Call on Line 1 We\'re Going to Take from Carol
In Miles City. Thanks,

Carol. How You Doing, Carol?

Caller: I\'m Doing Great. How Are You Guys? You Look So Comfortable up
There?

I Don\'t Know about That.

That\'s Just on the Outside.

the Closer We Get to the End, Probably the More Comfortable We Will
Look.

Caller: Kind of like 4:30 Towards the End of the Day. I Would like Lonny
to Address a Little

Bit on the Documentation Of Inspections, When You\'re Talking about like
Correlating The

Number of Inspections That Are Completed in the Year to What You Have
Put down for the

Matrix, I Need ‑‑ I Think it Needs to Be Clarified a Little Bit. Like
When You\'re Documenting

Drilling and Abandonment Inspections, Those Are Based on The Wells
Rather than ‑‑ like an Iid

Basis. But like Production Inspections Are Based on the Iid. So My
Concern Is There Are Cases

Or There Might Be Some Cases out There Where They\'re Doing
Environmental Inspections and

Looking at Several Different Wells Within the Same Iid but They\'re
Coding Those as Separate

Inspections, and Would That Make ‑‑ That\'s Going to Make a Difference
on How Their Matrix Is

Set up and How Many Inspections They Get Completed Because It\'s Going
to Look like They\'ve

Done a Lot More Inspections When Actually They\'ve Maybe Done One but
Looked at Several

Wells.

Right, Carol. Pass Concern, but One of the Things Offices Need to
Realize They Need to ‑‑ with

How They Plan to Do Their Inspections and How They\'re Counting, Such as
Environmental

Inspections, That They Also Document Them the Same Way They\'re Trying
to Plan for Them.

We Would like to See and Carol Made a Good Point, on Iids, an Inspection
Item as Don Said

Could Be Either a Lease, Communitization Agreement, a Unit of
Participating Area, but It Is Also

an Individual Well. Specifically for Drilling and Abandonment. An
Inspection Item There Is the

Well Because We\'re Not Looking At Any Other Part of the Lease At That
Time. So Those ‑‑ You

Need to Consider That, and That\'s How You Forecast Those, Is the Number
of Wells or Apds

You Expect to Have In That Particular Year. So in That Regard, You Need
to Be Careful with

Doing That, and We Want to Have Those Inspections on Iid Basis Related
To the Well. Then

with Environmental Inspections, When You Rate ‑‑ in Production an
Environmental Iid High to

the Environment, It\'s The Entire Whole Iid. It\'s Not the Wells
Included, but It\'s the Whole Thing.

So That Inspection Item Should Be ‑‑ That Inspection Should Be Counted
as One Environmental

Inspection.

Carol, Did That Address That?

Caller: Yeah. The One I Guess I Was a Little Concerned About, Too, Is
Oftentimes on the

Environmental Inspections on an Mrs Someone Would Do for Abandonment for
Final

Restoration, If There\'s an Iid That Says it Has like Two or Three Wells
on It, Are They Supposed

to Be Coding That as Separate Inspections or Would They Just Say They
Went to this Iid but

Looked at All Three of Those Wells and That Would Be One Inspection?

Again, the Iid Basis There Is The Well Because You\'re Looking At the
Reclamation for a

Particular Well When One of Them May Not Be Ready to Be Cleared, You May
Say ‑‑ and

Release the Bond for That Particular Well. So When You Go from the
Drilling And Plugging

Aspect to Abandonment, You\'re Looking at Individual Wells as an Iid. So
They Should Be Coded

Separately. And That\'s the Way They\'re Brought into Your Matrix, Is on
A Well by Well Basis, or

at Least Should Be, in My Opinion Brought in That Way, So That You Can
Count Them

Properly.

Okay. Thanks, Carol.

Caller: Thank You.

Bye‑bye.

We\'ve Got Jeff in Bakersfield Who Has Been Real Patient Here. We\'re
Going to Get to Him. Hi,

Jeff, How You Doing?

Caller: Fine, Thanks. How Are You?

Good. What\'s Up.

I Had a Question on Table 4 Under Active Inspections and Producing. You
Said the Total of

High and Low Should Equal the Total Iids, Which Is Going to Include Both
The Producing and

the Nonproducing Iids. Could You Explain this? That\'s at the Very Least
the Label Writ Says

Producing Is a Little Bit Misleading.

Well, under Table 2 in Your Matrix it Shows That as Being All of Your
Producing Inspection

Items, Those That Have Produced In the Last 12 Months and Those That
Have Not. They\'re All

in the Producing Status under the Definition of The Regulations. So When
You\'re Looking at the

Environmental Aspect, Then, You Need to Take into Consideration All
Leases That Are in the

Producing Status ‑‑ Capable of Production, Basically, and Those Are the
Ones That Need to

Balance Back and Forth Between The Two Categories. So You Are Looking at
the Total Of

Producing and Nonproducing And the Total High and Low on The
Environmental Should

Balance.

Caller: Okay. I Think That Answers Our Question. Thank You Very Much.

Thank You.

Thanks, Jeff. Appreciate the Call.

Caller: Thank You.

a Fax Question We Received: Lonny Could You Say Something About the
Meeting with Iogcc?

I Know We Don\'t Have a Ton of Time to Get into That, but Could You Give
Us a Couple

Highlights From That or Thumbnail Sketch or Let Us Know What the Formal
Feedback to the

Field Is Going To Be on That?

Yes, I Can. As You\'re All Aware I Have Been Appointed from the
Washington Office to Be

Kind of a Liaison Between the States and the BLM And Help Facilitate
Negotiations Between

BLM

and Individual States Regarding Transfer of the I&E Program. We Have
Also Met with the

Interstate Oil and Gas Compact Commission, and I Understand There Was a
Press Release That

Went Out, Particularly in Wyoming, Anyway, in the Casper Newspaper, That
Said BLM Was

Encouraged to Speed up the Transfer of the Oil and Gas I&E Program. A
Little Bit of the Basis

Behind What ‑‑ Iogcc and That\'s the Interstate Oil and Gas Compact
Commission. They Are

Made up of 29 Different States and Headed by the Governors of Those
States. They Are Asking

Us to Go Further Into Transfer Other than the I&E Program, Which the
Washington Office Says

No, We Will Not. Their Contention Is They Could Do it Better and Cheaper
than What the BLM

Could. And Some of Their Basis Is ‑‑ For Doing this Is, Obviously,
Money, and Some of the

Things That They\'re Also Looking at Is Reduction of Duplication and
Providing a Better

Customer Service to the Customer, and the Money Portion Comes ‑‑ the Net
Receipt Sharing

Comes Back to The Bureau for Monitoring Oil And Gas Leases, and When We
Met With the

Iogcc in Omaha a Couple Of Weeks Ago, We Had a Feeling That We Had
Reached at Least

Some Consensus on That We Would Transfer the I&E Program. We Then Had a
Hearing Before

a Subcommittee in Washington Just Yesterday to They Were Critical Of
What BLM and Iogcc

Were Doing And Wanted it Expedited. But the Basic Transfer Again, as You
All Have ‑‑ Have

Been Aware Of Rego 2 and an Transfer of the I&E Program, We Have Met
with Several States

and We Are Trying To Figure out What Works in One State and What
Doesn\'t and Doing Some

Comparisons Between State Programs. So Basically That\'s about Where
We\'re Standing at the

Moment in Relationship to the Transfer of The I&E Program to the States
And Rego 2.

I Hear an Awful Lot about Strategy and I Don\'t Want to ‑‑ Maybe Ask a
Question

Inappropriate, but We Spent a Lot of Time on Strategy. We\'re Working
Towards Specific

Outcomes down the Road. With Respect to the Strategy, How Are the
Measures and the Reports

That We Have Put Together Evaluated at the End of The Year and How Do We
Measure That?

Do We Measure That on a Statewide Bays, a National Basis And Who Are We
Measuring it for

And How Is That Reported To, I Guess, the Ige\'s or the Department ‑‑
How Does That Pot

Work.

the I&E Program Was Placed on A Material Weakness List after The ‑‑
Basically after the Ig\'s

Audit of 1989 and Gao and Had a Senate Subcommittee Looking at Us. They
Put Us on a

Material Weakness List and We Had to Come Up with Ways to Do Inspection
More Efficiently

and We Have Been Ongoing in That Process for A Number of Years Now. But
When this

Information Is All Given to the Washington Office, It Is Then Taken
Forward up to The

Department Level and Also Omb as Far as How We Are Trying To Eliminate
Our Material

Weakness. We\'ve Pretty Much Succeeded in That. We Have Made a Lot of
Success Since 1989

in this I&E Program And Will Continue to Go Further In That, but Getting
to Your Question

about Where it Goes and What Happens, the Monitoring of This Program
Occurs on a Quarterly

Basis in the Washington Office Level, and We Look at How Things Are
Going, If There Is a

Particular State That May Be Following Behind, We Ask What\'s Happening
There, We Didn\'t

Receive an Amended Strategy for Things like That, And We Will Continue
to Monitor That

Because We Have Congressional People, We Have Department People We Have
to Answer to

about What Is Our Progress. And It\'s Not So Much the Numbers But
What\'s Resulting from

Those Inspections. When I Give Presentations, I Dwell on the Fact of
Results, Even Though We

Have a Number of Inspections We Have Done, but What\'s the Results of
That. How Many

Barrels of Oil Did We Find That Were Misreported? I Think That\'s a Big
Step in the Strategy of

the I&E Program over The Past, It\'s Always Concentrate on Numbers and
We Want to Get Away

from That and Look at the Results. And Even If We Didn\'t Result in Any
Discrepancy, That\'s

Good, Because it Shows That Our I&E Program Is Working, and That We Can
Provide Actually

We Are After Compliance. If We Can Achieve Compliance, Our Program Is
Working.

You Have That Deterrence Factor of If We\'re There Doing Our Job,
Hopefully it Stops All

Those Things from Happening. It\'s Just like in the Drilling
Inspections. I\'ve Got Some Case

Studies from When I Worked in the Field of Five or Six Real Bad
Blow‑outs And I Look at the

Strategy We Have and the Program and the Training and the On‑shore
Orders And If Those

Things Were in Place Back Then When Those Things Happened, There\'s a
Real Good Chance

That One of Our Inspectors Would Have Required a Change from the Kind of
Equipment That

Was out There Then. But There\'s Never Any ‑‑ That Just Doesn\'t Show up
as a Flashy Statistic.

We Can\'t Say How Many Blow‑outs We Stop or How Much Oil We Stop From
Being Stolen,

but Certainly That\'s a Function That We Have, And That Was a Historical
Complaint about Our

Program, Is That We Weren\'t Doing the Job to The Level Where That Could
Be ‑‑ Where We

Were Preventing Those Things from Happening. So Now We\'ve Gotten up to
That Point Where

We\'re Accomplishing Those Things to a Certain Degree, Hopefully, and
Now We\'re Kind of

Getting Criticized Because We Can\'t Say How Many Barrels We\'re
Recovering Each Year. It\'s

like That Pendulum Swings From Which Side of the Question They Want
Answered.

Do You Have a Follow ‑‑

in Light of That, I Think It\'s Important That the Authorized Officer or
the Managers Be Aware

of Just Exactly the Dynamics of Their Own Program So That They Maintain
Some Balance in

What\'s Going On. If the Focus Is All, Shall We Say, All in One Sort of
Direction, Not That it

Shouldn\'t ‑‑ We Shouldn\'t Have Those Priorities, I Think They Need to
Look at and it Reevaluate

it Each Year and Understand What\'s Going On, How ‑‑ I Mean, We Have To
Judge Our Own

Effectiveness Out There. Along That Same Line, What I ‑‑ What I Think
I\'m Hear Something We

Have Been Rather Successful To Date. Are We Getting That Word Out, Other
than to People at

Omb? Otherwise We Are Doing a Heck of A Lot of Work and Every Now and
Then You Hear

Either from the Delegation or What Have You We Are Coming up Short in
Their Expectations. I

Am Wondering How That\'s Working.

I Try to Do That Every Chance I Get, Is to Compliment the Field on Where
We Have Come

from To Where We Are at Today and I Would Take That Opportunity Today. I
Think We Have

Made Great Strides and We Wouldn\'t Have Done it Without the People in
The Field.

Hord Touched on That a Little This Morning. Some of That Has Quieted
Down, That Extreme

Criticism of the Program, It\'s Quieted down Quite A Bit and it Comes
down to the

Professionalism in the Field, The Job Those Guys Are Doing out There.

I Think There Is Also Testimony to All the Folks out There in the Ground
‑‑ on the Ground. I

Was Manning the Office During The Furlough and It\'s Interesting ‑‑
Well, It\'s Very Worthwhile

and Rewarding When The Calls Are Coming in and People Can\'t Go out
There and Operate and

What Have You, the Dependency They Have on Us and The Reliance and Trust
They Have On

Us to Meet Their Needs in a Timely Fashion Really Became Apparent.
That\'s a Credit to

Everyone out There.

Sure Is. I Think, Again, One of the Aspects That Makes Those Programs
Real Successful out

There Is the Role That Pet Provides and the Tprs That Are Done in Those
States That Handle It

That Way and There Are Some Other Ways of Getting to That, Too. But
You\'ve Got to Have

Some Oversight to Your Program, and Washington, You Know, in the Old
Days That Was

Provided Directly Out of Washington. There Were People That Used to Come
out and Do That,

and That Kind of Got Cussed and Discussed, but it Served a Real Valuable
Function, and it Kind

Of Got Handed down to the States To Do it Themselves, and Within The
Field Office, They\'re

Doing It Themselves by the Lead Pets And Cross Training, and like I Say
a Lot of States Are

Trying To Do it from Their I&E Coordinator in the State Office And
Inviting People from Other

Districts and Other States to Participate Now. But as I Understand It, I
Mean, The Ig Is Going to

Hit Us over The Head Again with Our Report About Our Oversight ‑‑

They Haven\'t Come out with a Draft ‑‑ They Have Come out with A Draft
but They Haven\'t

Come Out with a Final Report Yet. But That\'s One of the Major Issues,
Is the Oversight

Function. They Still Don\'t Think We\'re There with the Amount of
Oversight We Ned in the

Program, For Whatever Action ‑‑ or Approach We Take, We Need to Have
Some Accountability

in There, and Looking at What We\'re Really Doing. Trying to Do it
Better.

Well, I\'ve Got a Couple Quick Questions Here. I Thought I Saw a Phone
Line, But I Think it

Went Back off Again. The Question Is: What Form Do We Use for Workover
Inspections?

Well, the Form, We Really Don\'t Have a Form Built for Workover
Inspections. We Have ‑‑ the

Closest One That Comes to That Is the Drilling Inspection Form, and it
Provides Information

Necessary That We Need for Document ‑‑ the Most Important Part to
Document Your Workover

Inspection Would Be in The Airs Database at this Time. There Are Areas
for Workovers Such as

Pluggings and Things Like That Might Occur, Comment‑back and Things like
That, but the

Drilling Form and Bop Test and Things in That Regard Works Pretty Well
for That.

Okay. Just Trying to Make Sure We Have Touched on Everything. We Got a
Question That I

Believe We Handled Early on but We May Not Have Been Clear on It, So
Maybe We\'ll Hit it

Again Here. Why Is the Compliance Criteria Six Minors or Two Majors,
Your Majors Being

More Critical than A Minor? Why Is the Criteria Not Changed To Five
Minors and One Major or

Six Minors and 2 Majors? That Disparity Again?

It\'s a Disparity Between the Environmental Side and the Fogrma Criteria
under Production

Accountability Where I Think People Are Seeing That. It Could Have Been
Easily Set at Any

Level of ‑‑ or Given to the Operator, but the Team in 1989 That Put this
Particular Criteria

Together Said, Well, We\'ll Use Two Major and Six Minors Based on What
Was in the On‑shore

Orders at That Time and How Easy it Would Be to Get a Major Violation
Based on the Orders.

Okay. I Think That Covers That, and We\'re Kind of Getting to the
Wrap‑up Point. I Know One

Thing We Want to Do, She Is Going to Kill Me for This, but We Want Patty
to Come Out Here

at this Point.

You Bet We Do.

Patty Was Instrumental in This Thing. She\'s the Brains Behind this. If
You Really Liked It, the

Credit Goes to Patty. If it Was a Disaster, It\'s Because We Couldn\'t
Carry Through on What

Patty Told Us to Do.

Patty from the Utah State Office Was the Producer for this Program, and
If You Know Anything

at All about Putting Together a Program like This, You Know That the
Brunt of the Work Is

Producing it and She\'s Done Simply a Fabulous Job. While We\'re Getting
Patty out Here, I Want

to Thank Any Number Of People. Vince Falderas from Hobbs Who Handled the
Telephone. All

of the Behind the Scenes Folks Who Made this Broadcast a Reality. I
Would like to Thank Don

Henrichsen and Lonny Bagley and Howard Lemm for Sharing Their Knowledge
with Us Today.

And Also a Special Thanks, of Course, to Hord Tipton for Being With Us
this Morning. Patty,

Great. This Is Our Gal.

I Tell You What, the Production Crew We\'ve Had a Chance to Work with
Has Just Been Super,

Everybody down Here At the Training Center.

a Special Thanks Is Due to Chip Calamaio and His Excellent Crew Here,
His Production Crew

At the NTC. We Are Grateful to All of These Gentlemen. That Concludes
Our Telecast, Folks,

and We Hope That it Was a Useful Tool for Learning about The I&E Program
and in Preparing

Your Strategy Matrices. This Is a Good Time to Please Complete Your
Course Roster and Your

Course Evaluation and Send It to Me Here at the Training Center as Soon
as Possible. We\'ve

Enjoyed Presenting this Course to You. It\'s One in a Series of Distance
Learning Programs by the

BLM National Training Center and We Value Your Comments and Suggestions.
As I Said,

Please

Mail Your Evaluation Form in as Soon as Possible. We Really Do Look at
Those Things and

They Do Make an Awful Lot of Difference. Anything Else, Gentlemen?
Patty?

No.

with That, Thank You Very Much. Good‑bye. Good Afternoon. Take Care!