Title 43—Public Lands: Interior--Volume 1
PART 3170—ONSHORE OIL AND GAS PRODUCTION
§ 3170.1   Authority.
The authorities for promulgating the regulations in this part are the Mineral Leasing Act, 30 U.S.C. 181 et seq.; the Mineral Leasing Act for Acquired Lands, 30 U.S.C. 351 et seq.; the Federal Oil and Gas Royalty Management Act, 30 U.S.C. 1701 et seq.; the Indian Mineral Leasing Act, 25 U.S.C. 396a et seq.; the Act of March 3, 1909, 25 U.S.C. 396; the Indian Mineral Development Act, 25 U.S.C. 2101 et seq.; and the Federal Land Policy and Management Act, 43 U.S.C. 1701 et seq. Each of these statutes gives the Secretary the authority to promulgate necessary and appropriate rules and regulations governing Federal and Indian (except Osage Tribe) oil and gas leases. See 30 U.S.C. 189; 30 U.S.C. 359; 25 U.S.C. 396d; 25 U.S.C. 396; 25 U.S.C. 2107; and 43 U.S.C. 1740. Under Secretarial Order Number 3087, dated December 3, 1982, as amended on February 7, 1983 (48 FR 8983), and the Departmental Manual (235 DM 1.1), the Secretary has delegated regulatory authority over onshore oil and gas development on Federal and Indian (except Osage Tribe) lands to the BLM. For Indian leases, the delegation of authority to the BLM is reflected in 25 CFR parts 211, 212, 213, 225, and 227. In addition, as authorized by 43 U.S.C. 1731(a), the Secretary has delegated to the BLM regulatory responsibility for oil and gas operations on Indian lands. 235 DM 1.1.K.
§ 3170.2   Scope.
The regulations in this part apply to:
(a) All Federal onshore and Indian oil and gas leases (other than those of the Osage Tribe);
(b) Indian Mineral Development Act (IMDA) agreements for oil and gas, unless specifically excluded in the agreement or unless the relevant provisions of the rule are inconsistent with the agreement;
(c) Leases and other business agreements for the development of tribal energy resources under a Tribal Energy Resource Agreement entered into with the Secretary, unless specifically excluded in the lease, other business agreement, or Tribal Energy Resource Agreement;
(d) State or private tracts committed to a federally approved unit or communitization agreement (CA) as defined by or established under 43 CFR subpart 3105 or 43 CFR part 3180; and
(e) All onshore facility measurement points where oil or gas produced from the leases or agreements identified earlier in this section is measured.
§ 3170.3   Definitions and acronyms.
(a) As used in this part, the term:
Allocated or allocation means a method or process by which production is measured at a central point and apportioned to the individual lease, or unit Participating Area (PA), or CA from which the production originated.
API (followed by a number) means the American Petroleum Institute Manual of Petroleum Measurement Standards, with the number referring to the Chapter and Section in that manual.
Audit trail means all source records necessary to verify and recalculate the volume and quality of oil or gas production measured at a facility measurement point (FMP) and reported to the Office of Natural Resources Revenue (ONRR).
Authorized officer (AO) has the same meaning as defined in 43 CFR 3000.0-5.
Averaging period means the previous 12 months or the life of the meter, whichever is shorter. For FMPs that measure production from a newly drilled well, the averaging period excludes production from that well that occurred in or before the first full month of production. (For example, if an oil FMP and a gas FMP were installed to measure only the production from a new well that first produced on April 10, the averaging period for this FMP would not include the production that occurred in April (partial month) and May (full month) of that year.)
Bias means a shift in the mean value of a set of measurements away from the true value of what is being measured.
By-pass means any piping or other arrangement around or avoiding a meter or other measuring device or method (or component thereof) at an FMP that allows oil or gas to flow without measurement. Equipment that permits the changing of the orifice plate of a gas meter without bleeding the pressure off the gas meter run ( e.g., senior fitting) is not considered to be a by-pass.
Commingling, for production accounting and reporting purposes, means combining, before the point of royalty measurement, production from more than one lease, unit PA, or CA, or production from one or more leases, unit PAs, or CAs with production from State, local governmental, or private properties that are outside the boundaries of those leases, unit PAs, or CAs. Combining production from multiple wells within a single lease, unit PA, or CA, or combining production downhole from different geologic formations within the same lease, unit PA, or CA, is not considered commingling for production accounting purposes.
Communitized area means the area committed to a BLM approved communitization agreement.
Communitization agreement (CA) means an agreement to combine a lease or a portion of a lease that cannot otherwise be independently developed and operated in conformity with an established well spacing or well development program, with other tracts for purposes of cooperative development and operations.
Condition of Approval (COA) means a site-specific requirement included in the approval of an application that may limit or modify the specific actions covered by the application. Conditions of approval may minimize, mitigate, or prevent impacts to public lands or resources.
Days means consecutive calendar days, unless otherwise indicated.
Facility means:
(i) A site and associated equipment used to process, treat, store, or measure production from or allocated to a Federal or Indian lease, unit PA, or CA that is located upstream of or at (and including) the approved point of royalty measurement; and
(ii) A site and associated equipment used to store, measure, or dispose of produced water that is located on a lease, unit, or communitized area.
Facility measurement point (FMP) means a BLM-approved point where oil or gas produced from a Federal or Indian lease, unit PA, or CA is measured and the measurement affects the calculation of the volume or quality of production on which royalty is owed. FMP includes, but is not limited to, the approved point of royalty measurement and measurement points relevant to determining the allocation of production to Federal or Indian leases, unit PAs, or CAs. However, allocation facilities that are part of a commingling and allocation approval under § 3173.15 or that are part of a commingling and allocation approval approved after July 9, 2013, are not FMPs. An FMP also includes a meter or measurement facility used in the determination of the volume or quality of royalty-bearing oil or gas produced before BLM approval of an FMP under § 3173.12. An FMP must be located on the lease, unit, or communitized area unless the BLM approves measurement off the lease, unit, or CA. The BLM will not approve a gas processing plant tailgate meter located off the lease, unit, or CA, as an FMP.
Gas means any fluid, either combustible or noncombustible, hydrocarbon or non-hydrocarbon, that has neither independent shape nor volume, but tends to expand indefinitely and exists in a gaseous state under metered temperature and pressure conditions.
Incident of Noncompliance (INC) means documentation that the BLM issues that identifies violations and notifies the recipient of the notice of required corrective actions.
Lease has the same meaning as defined in 43 CFR 3160.0-5.
Lessee has the same meaning as defined in 43 CFR 3160.0-5.
NIST traceable means an unbroken and documented chain of comparisons relating measurements from field or laboratory instruments to a known standard maintained by the National Institute of Standards and Technology (NIST).
Notice to lessees and operators (NTL) has the same meaning as defined in 43 CFR 3160.0-5.
Off-lease measurement means measurement at an FMP that is not located on the lease, unit, or communitized area from which the production came.
Oil means a mixture of hydrocarbons that exists in the liquid phase at the temperature and pressure at which it is measured. Condensate is considered to be oil for purposes of this part. Gas liquids extracted from a gas stream upstream of the approved point of royalty measurement are considered to be oil for purposes of this part.
(i) Clean oil or Pipeline oil means oil that is of such quality that it is acceptable to normal purchasers.
(ii) Slop oil means oil that is of such quality that it is not acceptable to normal purchasers and is usually sold to oil reclaimers. Oil that can be made acceptable to normal purchasers through special treatment that can be economically provided at existing or modified facilities or using portable equipment at or upstream of the FMP is not slop oil.
(iii) Waste oil means oil that has been determined by the AO or authorized representative to be of such quality that it cannot be treated economically and put in a marketable condition with existing or modified lease facilities or portable equipment, cannot be sold to reclaimers, and has been determined by the AO to have no economic value.
Operator has the same meaning as defined in 43 CFR 3160.0-5.
Participating area (PA) has the same meaning as defined in 43 CFR 3180.0-5.
Point of royalty measurement means a BLM-approved FMP at which the volume and quality of oil or gas which is subject to royalty is measured. The point of royalty measurement is to be distinguished from meters that determine only the allocation of production to particular leases, unit PAs, CAs, or non-Federal and non-Indian properties. The point of royalty measurement is also known as the point of royalty settlement.
Production means oil or gas removed from a well bore and any products derived therefrom.
Production Measurement Team (PMT) means a panel of members from the BLM (which may include BLM-contracted experts) that reviews changes in industry measurement technology, methods, and standards to determine whether regulations should be updated, and provides guidance on measurement technologies and methods not addressed in current regulation. The purpose of the PMT is to act as a central advisory body to ensure that oil and gas produced from Federal and Indian leases is accurately measured and properly reported.
Purchaser means any person or entity who legally takes ownership of oil or gas in exchange for financial or other consideration.
Source record means any unedited and original record, document, or data that is used to determine volume and quality of production, regardless of format or how it was created or stored ( e.g., paper or electronic). It includes, but is not limited to, raw and unprocessed data ( e.g., instantaneous and continuous information used by flow computers to calculate volumes); gas charts; measurement tickets; calibration, verification, prover, and configuration reports; pumper and gauger field logs; volume statements; event logs; seal records; and gas analyses.
Statistically significant describes a difference between two data sets that exceeds the threshold of significance.
Tampering means any deliberate adjustment or alteration to a meter or measurement device, appropriate valve, or measurement process that could introduce bias into the measurement or affect the BLM's ability to independently verify volumes or qualities reported.
Threshold of significance means the maximum difference between two data sets (a and b) that can be attributed to uncertainty effects. The threshold of significance is determined as follows:
Total observed volume (TOV) means the total measured volume of all oil, sludges, sediment and water, and free water at the measured or observed temperature and pressure.
Transporter means any person or entity who legally moves or transports oil or gas from an FMP.
Uncertainty means the statistical range of error that can be expected between a measured value and the true value of what is being measured. Uncertainty is determined at a 95 percent confidence level for the purposes of this part.
Unit means the land within a unit area as defined in 43 CFR 3180.0-5.
Unit PA means the unit participating area, if one is in effect, the exploratory unit if there is no associated participating area, or an enhanced recovery unit.
Variance means an approved alternative to a provision or standard of a regulation, Onshore Oil and Gas Order, or NTL.
(b) As used in this part, the following additional acronyms apply:
API means American Petroleum Institute.
BLM means the Bureau of Land Management.
Btu means British thermal unit.
CMS means Coriolis Measurement System.
LACT means lease automatic custody transfer.
OGOR means Oil and Gas Operations Report (Form ONRR-4054 or any successor report).
ONRR means the Office of Natural Resources Revenue, U.S. Department of the Interior, and includes any successor agency.
S&W means sediment and water.
WIS means Well Information System or any successor electronic filing system.
§ 3170.4   Prohibitions against by-pass and tampering.
(a) All by-passes are prohibited.
(b) Tampering with any measurement device, component of a measurement device, or measurement process is prohibited.
(c) Any by-pass or tampering with a measurement device, component of a measurement device, or measurement process may, together with any other remedies provided by law, result in an assessment of civil penalties for knowingly or willfully:
(1) Taking, removing, transporting, using, or diverting oil or gas from a lease site without valid legal authority under 30 U.S.C. 1719(d)(2) and 43 CFR 3163.2(f)(2); or
(2) Preparing, maintaining, or submitting false, inaccurate, or misleading reports, records, or information under 30 U.S.C. 1719(d)(1) and 43 CFR 3163.2(f)(1).
§ 3170.5   [Reserved]
§ 3170.6   Variances.
(a) Any party subject to a requirement of a regulation in this part may request a variance from that requirement.
(1) A request for a variance must include the following:
(i) Identification of the specific requirement from which the variance is requested;
(ii) Identification of the length of time for which the variance is requested, if applicable;
(iii) An explanation of the need for the variance;
(iv) A detailed description of the proposed alternative means of compliance;
(v) A showing that the proposed alternative means of compliance will produce a result that meets or exceeds the objectives of the applicable requirement for which the variance is requested; and
(vi) The FMP number(s) for which the variance is requested, if applicable.
(2) A request for a variance must be submitted as a separate document from any plans or applications. A request for a variance that is submitted as part of a master development plan, application for permit to drill, right-of-way application, or application for approval of other types of operations, rather than submitted separately, will not be considered. Approval of a plan or application that contains a request for a variance does not constitute approval of the variance. A separate request for a variance may be submitted simultaneously with a plan or application. For plans or applications that are contingent upon the approval of the variance request, the BLM encourages the simultaneous submission of the variance request and the plan or application.
(3) The party requesting the variance must file the request and any supporting documents using WIS. If electronic filing is not possible or practical, the operator may submit a request for variance on the Form 3160-5, Sundry Notices and Reports on Wells (Sundry Notice) to the BLM Field Office having jurisdiction over the lands described in the application.
(4) The AO, after considering all relevant factors, may approve the variance, or approve it with COAs, only if the AO determines that:
(i) The proposed alternative means of compliance meets or exceeds the objectives of the applicable requirement(s) of the regulation;
(ii) Approving the variance will not adversely affect royalty income and production accountability; and
(iii) Issuing the variance is consistent with maximum ultimate economic recovery, as defined in 43 CFR 3160.0-5.
(5) The decision whether to grant or deny the variance request is entirely within the BLM's discretion.
(6) A variance from the requirements of a regulation in this part does not constitute a variance from provisions of other regulations, including Onshore Oil and Gas Orders.
(b) The BLM reserves the right to rescind a variance or modify any COA of a variance due to changes in Federal law, technology, regulation, BLM policy, field operations, noncompliance, or other reasons. The BLM will provide a written justification if it rescinds a variance or modifies a COA.
§ 3170.7   Required recordkeeping, records retention, and records submission.
(a) Lessees, operators, purchasers, transporters, and any other person directly involved in producing, transporting, purchasing, selling, or measuring oil or gas through the point of royalty measurement or the point of first sale, whichever is later, must retain all records, including source records, that are relevant to determining the quality, quantity, disposition, and verification of production attributable to Federal or Indian leases for the periods prescribed in paragraphs (c) through (e) of this section.
(b) This retention requirement applies to records generated during or for the period for which the lessee or operator has an interest in or conducted operations on the lease, or in which a person is involved in transporting, purchasing, or selling production from the lease.
(c) For Federal leases, and units or CAs that include Federal leases, but do not include Indian leases, the record holder must maintain records for:
(1) Seven years after the records are generated; unless,
(2) A judicial proceeding or demand involving such records is timely commenced, in which case the record holder must maintain such records until the final nonappealable decision in such judicial proceeding is made, or with respect to that demand is rendered, unless the Secretary or his/her designee or the applicable delegated State authorizes in writing an earlier release of the requirement to maintain such records.
(d) For Indian leases, and units or CAs that include Indian leases, but do not include Federal leases, the record holder must maintain records for:
(1) Six years after the records are generated; unless,
(2) The Secretary or his/her designee notifies the record holder that the Department of the Interior has initiated or is participating in an audit or investigation involving such records, in which case the record holder must maintain such records until the Secretary or his/her designee releases the record holder from the obligation to maintain the records.
(e) For units and communitized areas that include both Federal and Indian leases, 6 years after the records are generated. If the Secretary or his/her designee has notified the record holder within those 6 years that an audit or investigation involving such records has been initiated, then:
(1) If a judicial proceeding or demand is commenced within 7 years after the records are generated, the record holder must retain all records regarding production from the lease, unit PA, or CA until the final nonappealable decision in such judicial proceeding is made, or with respect to that demand is rendered, unless the Secretary or his/her designee authorizes in writing a release of the requirement to maintain such records before a final nonappealable decision is made or rendered.
(2) If a judicial proceeding or demand is not commenced within 7 years after the records are generated, the record holder must retain all records regarding production from the unit or communitized area until the Secretary or his/her designee releases the record holder from the obligation to maintain the records;
(f) The lessee, operator, purchaser, or transporter must maintain an audit trail.
(g) All records, including source records, that are used to determine quality, quantity, disposition, and verification of production attributable to a Federal or Indian lease, unit PA, or CA, must include the FMP number or the lease, unit PA, or CA number, along with a unique equipment identifier ( e.g., a unique tank identification number and meter station number), and the name of the company that created the record. For all facilities existing prior to the assignment of an FMP number, all records must include the following information:
(1) The name of the operator;
(2) The lease, unit PA, or CA number; and
(3) The well or facility name and number.
(h) Upon request of the AO, the operator, purchaser, or transporter must provide such records to the AO as may be required by regulation, written order, Onshore Order, NTL, or COA.
(i) All records must be legible.
(j) All records requiring a signature must also have the signer's printed name.
§ 3170.8   Appeal procedures.
(a) BLM decisions, orders, assessments, or other actions under the regulations in this part are administratively appealable under the procedures prescribed in 43 CFR 3165.3(b), 3165.4, and part 4.
(b) For any recommendation made by the PMT, and approved by the BLM, a party affected by such recommendation may file a request for discretionary review by the Assistant Secretary for Land and Minerals Management. The Assistant Secretary may delegate this review function as he or she deems appropriate, in which case the affected party's application for discretionary review must be made to the person or persons to whom the Assistant Secretary's review function has been delegated.
§ 3170.9   Enforcement.
Noncompliance with any of the requirements of this part or any order issued under this part may result in enforcement actions under 43 CFR subpart 3163 or any other remedy available under applicable law or regulation.
§ 3171.1   Authority.
(a) The Secretaries of the Interior and Agriculture have authority under various Federal and Indian mineral leasing laws, as defined in 30 U.S.C. 1702, to manage oil and gas operations. The Secretary of the Interior has delegated this authority to the Bureau of Land Management (BLM), which has issued onshore oil and gas operating regulations codified at 43 CFR part 3160. For leases on Indian lands, the delegation to the BLM appears at 25 CFR parts 211, 212, 213, 225, and 227.
(b) The Secretary of Agriculture has authority under the Federal Onshore Oil and Gas Leasing Reform Act of 1987 (Pub. L. 100-203) (Reform Act) to regulate surface disturbing activities conducted pursuant to a Federal oil and gas lease on National Forest Service (NFS) lands. This authority has been delegated to the Forest Service (FS). Its regulatory authority is at 36 CFR chapter II, including, but not limited to, part 228, subpart E, part 251, subpart B, and part 261. The FS is responsible only for approving and regulating surface disturbing activities on NFS lands and appeals related to FS decisions or approvals.
§ 3171.2   Purpose.
The purpose of this subpart is to state the application requirements for the approval of all proposed oil and gas and service wells, certain subsequent well operations, and abandonment.
§ 3171.3   Scope.
This subpart applies to all onshore leases of Federal and Indian oil and gas (other than those of the Osage Tribe). It also applies to Indian Mineral Development Act agreements. For proposed operations on a committed State or fee tract in a federally supervised unit or communitized tract, the operator must furnish a copy of the approved State permit to the authorized officer of the BLM which will be accepted for record purposes.
§ 3171.4   Definitions.
As used in this subpart, the following definitions apply:
Best Management Practices (BMP) means practices that provide for state-of-the-art mitigation of specific impacts that result from surface operations. Best Management Practices are voluntary unless they have been analyzed as a mitigation measure in the environmental review for a Master Development Plan, Application for Permit to Drill (APD), Right-of-Way, or other related facility and included as a Condition of Approval.
Blooie line means a discharge line used in conjunction with a rotating head in drilling operations when air or gas is used as the circulating medium.
Casual use means activities involving practices that do not ordinarily lead to any appreciable disturbance or damage to lands, resources, or improvements. This term does not apply to private surface. Casual use includes surveying activities.
Complete APD means that the information in the APD package is accurate and addresses all of the requirements of this subpart. The onsite inspection verifies important information that is part of the APD package and is a critical step in determining if the package is complete. Therefore, the onsite inspection must be conducted, and any deficiencies identified at the onsite corrected, before the APD package can be considered to be complete. While cultural, biological, or other inventories and environmental assessments (EA) or environmental impact statements (EIS) may be required to approve the APD, they are not required before an APD package is considered to be complete.
(1) The APD package must contain:
(i) A completed Form 3160-3 (Application for Permit to Drill or Reenter) (see 43 CFR 3162.3-1(d));
(ii) A well plat certified by a registered surveyor with a surveyor's original stamp (see § 3171.6(b));
(iii) A drilling plan (see 43 CFR 3162.3-1(d) and 3171.7);
(iv) A Surface Use Plan of Operations (see 43 CFR 3162.3-1(d) and 3171.8);
(v) Evidence of bond coverage (see 43 CFR 3162.3-1(d) and 3171.9);
(vi) Operator certification with original signature (see § 3171.10); and
(vii) Other information that may be required by order or notice (see 43 CFR 3162.3-1(d)(4)).
(2) The BLM and the surface managing agency, as appropriate, will review the APD package and determine that the drilling plan, the Surface Use Plan of Operations, and other information that the BLM may require (43 CFR 3162.3-1(d)(4)), including the well location plat and geospatial databases, completely describe the proposed action.
Condition of Approval (COA) means a site-specific requirement included in an approved APD or Sundry Notice that may limit or amend the specific actions proposed by the operator. Conditions of Approval minimize, mitigate, or prevent impacts to public lands or other resources. Best Management Practices may be incorporated as a Condition of Approval.
Days means all calendar days including holidays.
Emergency repairs means actions necessary to correct an unforeseen problem that could cause or threaten immediate substantial adverse impact on public health and safety or the environment.
Geospatial database means a set of georeferenced computer data that contains both spatial and attribute data. The spatial data defines the geometry of the object and the attribute data defines all other characteristics.
Indian lands means any lands or interest in lands of an Indian tribe or an Indian allottee held in trust by the United States or which is subject to a Federal restriction against alienation.
Indian oil and gas means any oil and gas interest of an Indian tribe or on allotted lands where the interest is held in trust by the United States or is subject to Federal restrictions against alienation. It does not include minerals subject to the provisions of section 3 of the Act of June 28, 1906 (34 Stat. 539), but does include oil and gas on lands administered by the United States under section 14(g) of Public Law 92-203, as amended.
Master Development Plan means information common to multiple planned wells, including drilling plans, Surface Use Plans of Operations, and plans for future production.
National Forest System lands means those Federal lands administered by the U.S. Forest Service, such as the National Forests and the National Grasslands.
Onsite inspection means an inspection of the proposed drill pad, access road, flowline route, and any associated Right-of-Way or Special Use Authorization needed for support facilities, conducted before the approval of the APD or Surface Use Plan of Operations and construction activities.
Private surface owner means a non-Federal or non-State owner of the surface estate and includes any Indian owner of surface estate not held in trust by the United States.
Reclamation means returning disturbed land as near to its predisturbed condition as is reasonably practical.
Split estate means lands where the surface is owned by an entity or person other than the owner of the Federal or Indian oil and gas.
Surface managing agency means any Federal or State agency having jurisdiction over the surface overlying Federal or Indian oil and gas.
Variance means an approved alternative to a provision or standard of an order or Notice to Lessee.
§ 3171.5   Application for Permit to Drill (APD).
An Application for Permit to Drill or Reenter, on Form 3160-3, is required for each proposed well, and for reentry of existing wells (including disposal and service wells), to develop an onshore lease for Federal or Indian oil and gas.
(a) Where to file. On or after March 13, 2017, the operator must file an APD and associated documents using the BLM's electronic commerce application for oil and gas permitting and reporting. The operator may contact the local BLM Field Office for information on how to gain access to the electronic commerce application. Prior to March 13, 2017, an operator may file an APD and associated documents in the BLM Field Office having jurisdiction over the application.
(b) Early notification. The operator may wish to contact the BLM and any applicable surface managing agency, as well as all private surface owners, to request an initial planning conference as soon as the operator has identified a potential area of development. Early notification is voluntary and would precede the Notice of Staking option or filing of an APD. It allows the involved surface managing agency or private surface owner to apprise the prospective operator of any unusual conditions on the lease area. Early notification also provides both the surface managing agency or private surface owner and the prospective operator with the earliest possible identification of seasonal restrictions and determination of potential areas of conflict. The prospective operator should have a map of the proposed project available for surface managing agency review to determine if a cultural or biological inventory or other information may be required. Inventories are not the responsibility of the operator.
(c) Notice of Staking option. (1) Before filing an APD or Master Development Plan, the operator may file a Notice of Staking with the BLM. The purpose of the Notice of Staking is to provide the operator with an opportunity to gather information to better address site-specific resource concerns while preparing the APD package. This may expedite approval of the APD. On or after March 13, 2017, if an operator chooses to file a Notice of Staking (NOS), the operator must file the NOS using the BLM's electronic commerce application for oil and gas permitting and reporting. Attachment I, Sample Format for Notice of Staking, provides the information required for the Notice of Staking option. Prior to March 13, 2017, an operator may file a Notice of Staking in the BLM Field Office having jurisdiction.
(2) For Federal lands managed by other surface managing agencies, the BLM will provide a copy of the Notice of Staking to the appropriate surface managing agency office. In Alaska, when a subsistence stipulation is part of the lease, the operator must also send a copy of the Notice of Staking to the appropriate Borough and/or Native Regional or Village Corporation.
(3) Within 10 days of receiving the Notice of Staking, the BLM or the FS will review it for required information and schedule a date for the onsite inspection. The onsite inspection will be conducted as soon as weather and other conditions permit. The operator must stake the proposed drill pad and ancillary facilities, and flag new or reconstructed access routes, before the onsite inspection. The staking must include a center stake for the proposed well, two reference stakes, and a flagged access road centerline. Staking activities are considered casual use unless the particular activity is likely to cause more than negligible disturbance or damage. Offroad vehicular use for the purposes of staking is casual use unless, in a particular case, it is likely to cause more than negligible disturbance or damage, or otherwise prohibited.
(4) On non-NFS lands, the BLM will invite the surface managing agency and private surface owner, if applicable, to participate in the onsite inspection. If the surface is privately owned, the operator must furnish to the BLM the name, address, and telephone number of the surface owner if known. All parties who attend the onsite inspection will jointly develop a list of resource concerns that the operator must address in the APD. The operator will be provided a list of these concerns either during the onsite inspection or within 7 days of the onsite inspection. Surface owner concerns will be considered to the extent practical within the law. Failure to submit an APD within 60 days of the onsite inspection will result in the Notice of Staking being returned to the operator.
§ 3171.6   Components of a complete APD package.
Operators are encouraged to consider and incorporate Best Management Practices into their APDs because Best Management Practices can result in reduced processing times and reduced number of Conditions of Approval. An APD package must include the following information that will be reviewed by technical specialists of the appropriate agencies to determine the technical adequacy of the package:
(a) A completed Form 3160-3; and
(b) A well plat. Operators must include in the APD package a well plat and geospatial database prepared by a registered surveyor depicting the proposed location of the well and identifying the points of control and datum used to establish the section lines or metes and bounds. The purpose of this plat is to ensure that operations are within the boundaries of the lease or agreement and that the depiction of these operations is accurately recorded both as to location (latitude and longitude) and in relation to the surrounding lease or agreement boundaries (public land survey corner and boundary ties). The registered surveyor should coordinate with the cadastral survey division of the appropriate BLM state office, particularly where the lands have not been surveyed under the Public Land Survey System.
(1) The plat and geospatial database must describe the location of operations in:
(i) Geographical coordinates generated by an electronic navigation system, and document the datum referenced to generate these coordinates; and
(ii) In feet and direction from the nearest two adjacent section lines, or, if not within the Rectangular Survey System, the nearest two adjacent property lines, generated from the BLM's current Geographic Coordinate Data Base.
(2) The surveyor who prepared the plat must sign it, certifying that the location has been staked on the ground as shown on the plat.
(3) Surveying and staking are necessary casual uses, typically involving negligible surface disturbance. The operator is responsible for making access arrangements with the appropriate Surface Managing Agency (other than the BLM and the FS) or private surface owner. On tribal or allotted lands, the operator must contact the appropriate office of the BIA to make access arrangements with the Indian surface owners. In the event that not all of the Indian owners consent or may be located, but a majority of those who can be located consent, or the owners of interests are so numerous that it would be impracticable to obtain their consent and the BIA finds that the issuance of the APD will cause no substantive injury to the land or any owner thereof, the BIA may approve access. Typical off-road vehicular use, when conducted in conjunction with these activities, is a necessary action for obtaining a permit and may be done without advance approval from the Surface Managing Agency, except for:
(i) Lands administered by the Department of Defense;
(ii) Other lands used for military purposes;
(iii) Indian lands; or
(iv) Where more than negligible surface disturbance is likely to occur or is otherwise prohibited.
(4) No entry on split estate lands for surveying and staking should occur without the operator first making a good faith effort to notify the surface owner. Also, operators are encouraged to notify the BLM or the FS, as appropriate, before entering private lands to stake for Federal mineral estate locations.
§ 3171.7   Drilling plan.
With each copy of Form 3160-3, the operator must submit to the BLM either a drilling plan or reference a previously submitted field-wide drilling plan (a drilling plan that can be used for all the wells in a field, any differences for specific wells will be described in the APD specific to that well). The drilling plans must be in sufficient detail to permit a complete appraisal of the technical adequacy of, and environmental effects associated with, the proposed project. The drilling plan must adhere to the provisions and standards of subpart 3172 of this part and, if applicable, subpart 3176 of this part and must include the following information:
(a) Names and estimated tops of all geologic groups, formations, members, or zones.
(b) Estimated depth and thickness of formations, members, or zones potentially containing usable water, oil, gas, or prospectively valuable deposits of other minerals that the operator expects to encounter, and the operator's plans for protecting such resources.
(c) The operator's minimum specifications for blowout prevention equipment and diverter systems to be used, including size, pressure rating, configuration, and the testing procedure and frequency. Blowout prevention equipment must meet the minimum standards outlined in subpart 3172 of this part.
(d) The operator's proposed casing program, including size, grade, weight, type of thread and coupling, the setting depth of each string, and its condition. The operator must include the minimum design criteria, including casing loading assumptions and corresponding safety factors for burst, collapse, and tensions (body yield and joint strength). The operator must also include the lengths and setting depth of each casing when a tapered casing string is proposed. The hole size for each well bore section of hole drilled must be included. Special casing designs such as the use of coiled tubing or expandable casing may necessitate additional information.
(e) The estimated amount and type(s) of cement expected to be used in the setting of each casing string. If stage cementing will be used, provide the setting depth of the stage tool(s) and amount and type of cement, including additives, to be used for each stage. Provide the yield of each cement slurry and the expected top of cement, with excess, for each cemented string or stage.
(f) Type and characteristics of the proposed circulating medium or mediums proposed for the drilling of each well bore section, the quantities and types of mud and weighting material to be maintained, and the monitoring equipment to be used on the circulating system. The operator must submit the following information when air or gas drilling is proposed:
(1) Length, size, and location of the blooie line, including the gas ignition and dust suppression systems;
(2) Location and capacity of the compressor equipment, including safety devices, describe the distance from the well bore, and location within the drill site; and
(3) Anticipated amounts, types, and other characteristics as defined in this section, of the stand by mud or kill fluid and associated circulating equipment.
(g) The testing, logging, and coring procedures proposed, including drill stem testing procedures, equipment, and safety measures.
(h) The expected bottom-hole pressure and any anticipated abnormal pressures, temperatures, or potential hazards that the operator expects to encounter, such as lost circulation and hydrogen sulfide (see subpart 3176 of this part). A description of the operator's plans for mitigating such hazards must be included.
(i) Any other facets of the proposed operation that the operator would like the BLM to consider in reviewing the application. Examples include, but are not limited to:
(1) For directional wells, proposed directional design, plan view, and vertical section in true vertical and measured depths;
(2) Horizontal drilling; and
(3) Coil tubing operations.
§ 3171.8   Surface Use Plan of Operations.
(a) The Surface Use Plan of Operations must:
(1) Describe the access road(s) and drill pad, the construction methods that the operator plans to use, and the proposed means for containment and disposal of all waste materials;
(2) Provide for safe operations, adequate protection of surface resources, groundwater, and other environmental components;
(3) Include adequate measures for stabilization and reclamation of disturbed lands:
(4) Describe any Best Management Practices the operator plans to use; and
(5) Where the surface is privately owned, include a certification of Surface Access Agreement or an adequate bond, as described in § 3171.19.
(b) All maps that are included in the Surface Use Plan of Operations must be of a scale no smaller than 1:24,000, unless otherwise stated in paragraph (e) of this section. Geospatial vector and raster data must include appropriate attributes and metadata. Georeferenced raster images must be from the same source as hardcopy plats and maps submitted in the APD package. All proposed on-lease surface disturbance must be surveyed and staked as described in paragraphs (e)(1) through (12) of this section, including:
(1) The well location;
(2) Two 200-foot (61-meter) directional reference stakes;
(3) The exterior pad dimensions;
(4) The reserve pit;
(5) Cuts and fills;
(6) Outer limits of the area to be disturbed (catch points); and
(7) Any off-location facilities.
(c) Proposed new roads require centerline flagging with stakes clearly visible from one to the next. In rugged terrain, cut and fill staking and/or slope staking of proposed new access roads and locations for ancillary facilities that may be necessary, as determined by the BLM or the FS.
(d) The onsite inspection will not occur until the required surveying and staking is complete, and any new access road(s) have been flagged, unless a variance is first granted under § 3171.23.
(e) Information required by the Surface Use Plan of Operations may be shown on the same map if it is appropriately labeled or on separate diagrams or maps and must include the following:
(1) Existing roads. The operator must submit a legible map such as a highway or county road, United States Geological Survey (USGS) topographic, Alaska Borough, or other such map that shows the proposed well site and access route to the proposed well in relation to a town, village, or other locatable public access point.
(i) The operator must improve or maintain existing roads in a condition the same as or better than before operations began. The operator must provide any plans for improvement and/or maintenance of existing roads. The information provided by the operator for construction and use of roads will be used by the BLM for any Right-of-Way application, as described in § 3171.18. The operator may use existing terrain and two-track trails, where appropriate, to assure environmental protection. The operator should consider using Best Management Practices in improving or maintaining existing roads.
(ii) The operator may use existing roads under the jurisdiction of the FS for access if they meet the transportation objectives of the FS. When access involves the use of existing roads, the FS may require that the operator contribute to road maintenance. This is usually authorized by a Road Use Permit or a joint road use agreement. The FS will charge the operator a pro rata share of the costs of road maintenance and improvement, based upon the anticipated use of the road.
(2) New or reconstructed access roads. The operator must identify on a map all permanent and temporary access roads that it plans to construct or reconstruct in connection with the drilling of the proposed well. Locations of all existing and proposed road structures (culverts, bridges, low water crossings, etc.) must be shown. The proposed route to the proposed drill site must be shown, including distances from the point where the access route exits established roads. All permanent and temporary access roads must be located and designed to meet the applicable standards of the appropriate surface managing agency, and be consistent with the needs of the operator. The operator should consider using Best Management Practices in designing and constructing roads. The operator must design roads based upon the class or type of road, the safety requirements, traffic characteristics, environmental conditions, and the vehicles the road is expected to carry. The operator must describe for all road construction or reconstruction:
(i) Road width;
(ii) Maximum grade;
(iii) Crown design;
(iv) Turnouts;
(v) Drainage and ditch design;
(vi) On-site and off-site erosion control;
(vii) Revegetation of disturbed areas;
(viii) Location and size of culverts and/or bridges;
(ix) Fence cuts and/or cattleguards;
(x) Major cuts and fills;
(xi) Source and storage of topsoil; and
(xii) Type of surfacing materials, if any, that will be used.
(3) Location of existing wells. The operator must include a map and may include a geospatial database that includes all known wells, regardless of the well status (producing, abandoned, etc.), within a one-mile radius of the proposed location.
(4) Location of existing and/or proposed production facilities. The operator must include a map or diagram of facilities planned either on or off the well pad that shows, to the extent known or anticipated, the location of all production facilities and lines likely to be installed if the well is successfully completed for production.
(i) The map or diagram and optional geospatial database must show and differentiate between proposed and existing flow lines, overhead and buried power lines, and water lines. If facilities will be located on the well pad, the information should be consistent with the layout provided in paragraph (e)(9) of this section.
(ii) The operator must show the dimensions of the facility layouts for all new construction. This information may be used by the BLM or the FS for Right- of-Way or Special Use Authorization application information, as specified in § 3171.18.
(iii) If the operator has not developed information regarding production facilities, it may defer submission of that information until a production well is completed, in which case the operator will follow the procedures in § 3171.21. However, for purposes of the National Environmental Policy Act (NEPA) analysis, the BLM or the FS will need a reasonable estimate of the facilities to be employed.
(5) Location and types of water supply. Information concerning water supply, such as rivers, creeks, springs, lakes, ponds, and wells, may be shown by quarter-quarter section on a map or plat, or may be described in writing. The operator must identify the source, access route, and transportation method for all water anticipated for use in drilling the proposed well. The operator must describe any newly constructed or reconstructed access roads crossing Federal or Indian lands that are needed to haul the water as provided in paragraph (e)(2) of this section. The operator must indicate if it plans to drill a water supply well on the lease and, if so, the operator must describe the location, construction details, and expected production requirements, including a description of how water will be transported and procedures for well abandonment.
(6) Construction materials. The operator must state the character and intended use of all construction materials, such as sand, gravel, stone, and soil material. The proposed source must be shown on a quarter-quarter section of a map or plat or in a written description.
(7) Methods for handling waste. The Surface Use Plan of Operations must contain a written description of the methods and locations proposed for safe containment and disposal of each type of waste material ( e.g., cuttings, garbage, salts, chemicals, sewage, etc.) that results from drilling the proposed well. The narrative must include plans for the eventual disposal of drilling fluids and any produced oil or water recovered during testing operations. The operator must describe plans for the construction and lining, if necessary, of the reserve pit.
(8) Ancillary facilities. The operator must identify on a map the location and construction methods and materials for all anticipated ancillary facilities such as camps, airstrips, and staging areas. The operator must stake on the ground the approximate center of proposed camps and the centerline of airstrips. If the ancillary facilities are located off- lease, depending on surface managing agency policy, the BLM or the FS may require the operator to obtain an additional authorization, such as a Right-of-Way or Special Use Authorization.
(9) Well site layout. A diagram of the well site layout must have an arrow indicating the north direction. Diagrams with cuts and fills must be surveyed, designed, drawn, digitized, and certified by licensed professional surveyors or engineers.
(i) The operator must submit a plat of a scale of not less than 1 inch = 50 feet showing the location and orientation of:
(A) The proposed drill pad;
(B) Reserve pit/blooie line/flare pit location;
(C) Access road entry points and their approximate location with respect to topographic features and with cross section diagrams of the drill pad; and
(D) The reserve pit showing all cuts; and fills and the relation to topography.
(ii) The plat must also include the approximate proposed location and orientation of the:
(A) Drilling rig;
(B) Dikes and ditches to be constructed; and
(C) Topsoil and/or spoil material stockpiles.
(10) Plans for surface reclamation. The operator must submit a plan for the surface reclamation or stabilization of all disturbed areas. This plan must address interim (during production) reclamation for the area of the well pad not needed for production, as well as final abandonment of the well location.
(i) Such plans must include, as appropriate:
(A) Configuration of the reshaped topography;
(B) Drainage systems;
(C) Segregation of spoil materials (stockpiles);
(D) Surface disturbances;
(E) Backfill requirements;
(F) Proposals for pit/sump closures;
(G) Redistribution of topsoil;
(H) Soil treatments;
(I) Seeding or other steps to reestablish vegetation;
(J) Weed control; and
(K) Practices necessary to reclaim all disturbed areas, including any access roads and pipelines.
(ii) The operator may amend this reclamation plan at the time of abandonment. Further details for reclamation are contained in § 3171.25.
(11) Surface ownership. The operator must indicate (in a narrative) the surface ownership at the well location, and of all lands crossed by roads that the operator plans to construct or upgrade, including, if known, the name of the agency or owner, phone number, and address. The operator must certify that they have provided a copy of the Surface Use Plan of Operations required in this section to the private surface owner of the well site location, if applicable, or that they made a good faith effort if unable to provide the document to the surface owner.
(12) Other information. The operator must include other information required by applicable orders and notices (43 CFR 3162.3-1(d)(4)). When an integrated pest management program is needed for weed or insect control, the operator must coordinate plans with State or local management agencies and include the pest management program in the Surface Use Plan of Operations. The BLM also encourages the operator to submit any additional information that may be helpful in processing the application.
§ 3171.9   Bonding.
(a) Most bonding needs for oil and gas operations on Federal leases are discussed in 43 CFR part 3100, subpart 3104. The operator must obtain a bond in its own name as principal, or a bond in the name of the lessee or sublessee. If the operator uses the lessee or sublessee's bond, the operator must furnish a rider (consent of surety and principal) that includes the operator under the coverage of the bond. The operator must specify on the APD, Form 3160-3, the type of bond and bond number under which the operations will be conducted.
(1) For Indian oil and gas, the appropriate provisions at 25 CFR chapter I, subchapter I, govern bonding.
(2) Under the regulations at 43 CFR 3104.5 and 36 CFR 228.109, the BLM or the FS may require additional bond coverage for specific APDs. Other factors that the BLM or the FS may consider include:
(i) History of previous violations;
(ii) Location and depth of wells;
(iii) The total number of wells involved;
(iv) The age and production capability of the field; and
(v) Unique environmental issues.
(3) These bonds may be in addition to any statewide, nationwide, or separate lease bond already applicable to the lease. In determining the bond amount, the BLM may consider impacts of activities on both Federal and non-Federal lands required to develop the lease that impact lands, waters, and other resources off the lease.
(4) Separate bonds may be required for associated Rights-of-Way and/or Special Use Authorizations that authorize activities not covered by the approved APD.
(b) On Federal leases, operators may request a phased release of an individual lease bond. The BLM will grant this reduction after reclamation of some portion of the lease only if the operator:
(1) Has satisfied the terms and conditions in the plan for surface reclamation for that particular operation; and
(2) No longer has any down-hole liability.
(c) If appropriate, the BLM may reduce the bond in the amount requested by the operator or appropriate surface managing agency. The FS also may reduce bonds it requires (but not the BLM-required bonds). The BLM and the FS will base the amount of the bond reduction on a calculation of the sum that is sufficient to cover the remaining operations (including royalty payments) and abandonment (including reclamation) as authorized by the Surface Use Plan of Operations.
§ 3171.10   Operator certification.
(a) The operator must include its name, address, and telephone number, and the same information for its field representative, in the APD package.
(b) The following certification must carry the operator's original signature or be submitted to the BLM using the BLM's electronic reporting system:
I hereby certify that I, or someone under my direct supervision, have inspected the drill site and access route proposed herein; that I am familiar with the conditions which currently exist; that I have full knowledge of state and Federal laws applicable to this operation; that the statements made in this APD package are, to the best of my knowledge, true and correct; and that the work associated with the operations proposed herein will be performed in conformity with this APD package and the terms and conditions under which it is approved. I also certify that I, or the company I represent, am responsible for the operations conducted under this application. These statements are subject to the provisions of 18 U.S.C. 1001 for the filing of false statements.
(c) Agents not directly employed by the operator must submit a letter from the operator authorizing that agent to act or file this application on their behalf.
§ 3171.11   Onsite inspection.
The onsite inspection must be conducted before the APD will be considered complete.
§ 3171.12   APD posting and processing.
(a) Posting. The BLM and the Federal surface managing agency, if other than the BLM, must provide at least 30 days public notice before the BLM may approve an APD or Master Development Plan on a Federal oil and gas lease. Posting is not required for an APD for an Indian oil and gas lease or agreement.
(1) The BLM will post information about the APD or Notice of Staking for Federal oil and gas leases to the internet and in an area of the BLM Field Office having jurisdiction that is readily accessible to the public. Posting to the internet under this provision will not be required until after March 13, 2017. If the surface is managed by a Federal agency other than the BLM, that agency also is required to post the notice for at least 30 days. This would include the BIA where the surface is held in trust but the mineral estate is federally owned. The posting is for informational purposes only and is not an appealable decision. The purpose of the posting is to give any interested party notification that a Federal approval of mineral operations has been requested. The BLM or the FS will not post confidential information.
(2) Reposting of the proposal may be necessary if the posted location of the proposed well is:
(i) Moved to a different quarter-quarter section;
(ii) Moved more than 660 feet for lands that are not covered by a Public Land Survey; or
(iii) If the BLM or the FS determine that the move is substantial.
(b) Processing. The timeframes established in this paragraph apply to both individual APDs and to the multiple APDs included in Master Development Plans and to leases of Indian minerals as well as leases of Federal minerals. If there is enough information to begin processing the application, the BLM (and the FS if applicable) will process it up to the point that missing information or uncorrected deficiencies render further processing impractical or impossible.
(1) Within 10 days of receiving an application, the BLM (in consultation with the FS if the application concerns NFS lands) will notify the operator as to whether or not the application is complete. The BLM will request additional information and correction of any material submitted, if necessary, in the 10-day notification. If an onsite inspection has not been performed, the applicant will be notified that the application is not complete. Within 10 days of receiving the application, the BLM, in coordination with the operator and surface managing agency, including the private surface owner in the case of split estate minerals, will schedule a date for the onsite inspection (unless the onsite inspection has already been conducted as part of a Notice of Staking). The onsite inspection will be held as soon as practicable based on participants' schedules and weather conditions. The operator will be notified at the onsite inspection of any additional deficiencies that are discovered during the inspection. The operator has 45 days after receiving notice from the BLM to provide any additional information necessary to complete the APD, or the APD may be returned to the operator.
(2) Within 30 days after the operator has submitted a complete application, including incorporating any changes that resulted from the onsite inspection, the BLM will:
(i) Approve the application, subject to reasonable Conditions of Approval, if the appropriate requirements of the NEPA, National Historic Preservation Act, Endangered Species Act, and other applicable law have been met and, if on NFS lands, the FS has approved the Surface Use Plan of Operations;
(ii) Notify the operator that it is deferring action on the permit; or
(iii) Deny the permit if it cannot be approved and the BLM cannot identify any actions that the operator could take that would enable the BLM to issue the permit or the FS to approve the Surface Use Plan of Operations, if applicable.
(3) The notice of deferral in paragraph (b)(2)(ii) of this section must specify:
(i) Any action the operator could take that would enable the BLM (in consultation with the FS if applicable) to issue a final decision on the application. The FS will notify the applicant of any action the applicant could take that would enable the FS to issue a final decision on the Surface Use Plan of Operations on NFS lands. Actions may include, but are not limited to, assistance with:
(A) Data gathering; and
(B) Preparing analyses and documents.
(ii) If applicable, a list of actions that the BLM or the FS need to take before making a final decision on the application, including appropriate analysis under NEPA or other applicable law and a schedule for completing these actions.
(4) The operator has 2 years from the date of the notice under paragraph (b)(3)(i) of this section to take the action specified in the notice. If the appropriate analyses required by NEPA, National Historic Preservation Act, Endangered Species Act, and other applicable laws have been completed, the BLM (and the FS if applicable), will make a decision on the permit and the Surface Use Plan of Operations within 10 days of receiving a report from the operator addressing all of the issues or actions specified in the notice under paragraph (b)(3)(i) of this section and certifying that all required actions have been taken. If the operator has not completed the actions specified in the notice within 2 years from the operator's receipt of the notice under paragraph (b)(3)(i), the BLM will deny the permit.
(5) For APDs on NFS lands, the decision to approve a Surface Use Plan of Operations or Master Development Plan may be subject to FS appeal procedures. The BLM cannot approve an APD until the appeal of the Surface Use Plan of Operations is resolved.
§ 3171.13   Approval of APDs.
(a) The BLM has the lead responsibility for completing the environmental review process, except in the case of NFS lands.
(1) The BLM cannot approve an APD or Master Development Plan until the requirements of certain other laws and regulations including NEPA, the National Historic Preservation Act, and the Endangered Species Act have been met. The BLM must document that the needed reviews have been adequately conducted. In some cases, operators conduct these reviews, but the BLM remains responsible for their scope and content and makes its own evaluation of the environmental issues, as required by 40 CFR 1506.5(b).
(2) The approved APD will contain Conditions of Approval that reflect necessary mitigation measures. In accordance with 43 CFR 3101.1-2 and 36 CFR 228.107, the BLM or the FS may require reasonable mitigation measures to ensure that the proposed operations minimize adverse impacts to other resources, uses, and users, consistent with granted lease rights. The BLM will incorporate any mitigation requirements, including Best Management Practices, identified through the APD review and appropriate NEPA and related analyses, as Conditions of Approval to the APD.
(3) The BLM will establish the terms and Conditions of Approval for any associated Right-of-Way when the application is approved.
(b) For NFS lands, the FS will establish the terms and Conditions of Approval for both the Surface Use Plan of Operations and any associated Surface Use Authorization. On NFS lands the FS has principal responsibility for compliance with NEPA, the National Historic Preservation Act, and the Endangered Species Act, but the BLM should be a cooperating or co-lead agency for this purpose and adopt the analysis as the basis for its decision. After the FS notifies the BLM it has approved a Surface Use Plan of Operations on NFS lands, the BLM must approve the APD before the operator may begin any surface-disturbing activity.
(c) On Indian lands, BIA has responsibility for approving Rights-of-Way.
(d) In the case of Indian lands, the BLM may be a cooperating or co-lead agency for NEPA compliance or may adopt the NEPA analysis prepared by the BIA (516 Department of the Interior Manual (DM) 3).
§ 3171.14   Valid Period of Approved APD.
(a) For APDs approved after June 22, 2024, an APD approval is valid for 3 years from the date that it is approved, or until lease expiration, whichever occurs first.
(b) Notwithstanding paragraph (a) of this section, if an APD approval expires by reason other than lease expiration, the APD approval shall remain valid if the operator or lessee:
(1) Has drilled the well to the approximate total measured depth in the approved APD, including wells drilled to the approximate total measured depth and not yet completed;
(2) Is drilling the well with a rig capable of drilling the well to the proposed total measured depth in the approved APD; or
(3) Has set the surface casing for the well and has submitted a plan, approved by the BLM prior to expiration of the APD approval, for continuously drilling the well to reach the proposed total measured depth in the approved APD. The plan must include the timeframe for continuously drilling and completing the well and any extenuating circumstances that may delay the continuous drilling and completion of the well.
(c) If, upon expiration of the approved APD, the operator created surface disturbance or began drilling the well under the approved APD, the operator or lessee must either comply with all applicable plugging, abandonment, and reclamation requirements or submit a new APD covering the existing disturbance.
(d) The operator is responsible for reclaiming any surface disturbance that resulted from its actions, even if a well was not drilled. Earthwork for reclamation must be completed within 6 months of APD expiration (weather permitting).
(e) The valid period for an approved APD on a lease suspended under subpart 3103 will be adjusted to account for the suspension. Beginning on the date the suspension is lifted, the valid period of the approved APD will be extended by the time that was remaining on the term of the approved APD on the effective date of the suspension.
§ 3171.15   Master Development Plans.
(a) An operator may elect to submit a Master Development Plan addressing two or more APDs that share a common drilling plan, Surface Use Plan of Operations, and plans for future development and production. Submitting a Master Development Plan facilitates early planning, orderly development, and the cumulative effects analysis for all the APDs expected to be drilled by an operator in a developing field. Approval of a Master Development Plan serves as approval of all of the APDs submitted with the Plan. Processing of a Master Development Plan follows the procedures in § 3171.12(b).
(b) After the Master Development Plan is approved, subsequent APDs can reference the Master Development Plan and be approved using the NEPA analysis for the Master Development Plan, absent substantial deviation from the Master Development Plan previously analyzed or significant new information relevant to environmental effects. Therefore, an approved Master Development Plan results in timelier processing of subsequent APDs. Each subsequent proposed well must have a survey plat and an APD (Form 3160-3) that references the Master Development Plan and any specific variations for that well.
§ 3171.16   Waiver from electronic submission requirements.
The operator may request a waiver from the electronic submission requirement for an APD or Notice of Staking if compliance would cause hardship or the operator is unable to file these documents electronically. In the request, the operator must explain the reason(s) that prevent its use of the electronic system, plans for complying with the electronic submission requirement, and a timeframe for compliance. If the request applies to a particular set of APDs or Notices of Staking, then the request must identify the APDs or Notices of Staking to which the waiver applies. The waiver request is subject to BLM approval. If the request does not specify a particular set of APDs or Notices of Staking, then the waiver will apply to all submissions made by the operator during the compliance timeframe included as part of the BLM's waiver approval. The BLM will not consider an APD or Notice of Staking that the operator did not submit through the electronic system, unless the BLM approves a waiver.
§ 3171.17   General operating requirements—operator responsibilities.
(a) In the APD package, the operator must describe or show, as set forth in this subpart, the procedures, equipment, and materials to be used in the proposed operations. The operator must conduct operations to minimize adverse effects to surface and subsurface resources, prevent unnecessary surface disturbance, and conform with currently available technology and practice. While appropriate compliance with certain statutes, such as NEPA, the National Historic Preservation Act, and the Endangered Species Act, are Federal responsibilities, the operator may choose to conduct inventories and provide documentation to assist the BLM or the surface managing agency to meet the requirements of this paragraph (a). The inventories and other work may require entering the lease and adjacent lands before approval of the APD. As in staking and surveying, the operator should make a good faith effort to contact the surface managing agency or surface owner before entry upon the lands for these purposes.
(b) The operator cannot commence either drilling operations or preliminary construction activities before the BLM's approval of the APD. A copy of the approved APD and any Conditions of Approval must be available for review at the drill site. Operators are responsible for their contractor and subcontractor's compliance with the requirements of the approved APD and/or Surface Use Plan of Operations. Drilling without approval or causing surface disturbance without approval is a violation of 43 CFR 3162.3-1(c) and is subject to a monetary assessment under 43 CFR 3163.1(b)(2).
(c) The operator must comply with the provisions of the approved APD and applicable laws, regulations, and Notices to Lessees, including, but not limited to, those that address the issues described in paragraphs (c)(1) through (5) of this section.
(1) Cultural and historic resources. If historic or archaeological materials are uncovered during construction, the operator must immediately stop work that might further disturb such materials, contact the BLM and if appropriate, the FS or other surface managing agency. The BLM or the FS will inform the operator within 7 days after the operator contacted the BLM as to whether the materials appear eligible for listing on the National Register of Historic Places.
(i) If the operator decides to relocate operations to avoid further costs to mitigate the site, the operator remains responsible for recording the location of any historic or archaeological resource that are discovered as a result of the operator's actions. The operator also is responsible for stabilizing the exposed cultural material if the operator created an unstable condition that must be addressed immediately. The BLM, the FS, or other appropriate surface managing agency will assume responsibility for evaluation and determination of significance related to the historic or archaeological site.
(ii) If the operator does not relocate operations, the operator is responsible for mitigation and stabilization costs and the BLM, the FS, or appropriate surface managing agency will provide technical and procedural guidelines for conducting mitigation. The operator may resume construction operations when the BLM or the FS verifies that the operator has completed the required mitigation.
(iii) Relocation of activities may subject the proposal to additional environmental review. Therefore, if the presence of such sites is suspected, the operator may want to submit alternate locations for advance approval before starting construction.
(2) Endangered Species Act. To comply with the Endangered Species Act, as amended (16 U.S.C. 1531 et seq. ), and its implementing regulations in 50 CFR chapter I, the operator must conduct all operations such that all operations avoid a “take” of listed or proposed threatened or endangered species and their critical habitats.
(3) Surface protection. Except as otherwise provided in an approved Surface Use Plan of Operations, the operator must not conduct operations in areas subject to mass soil movement, riparian areas, floodplains, lakeshores, and/or wetlands. The operator also must take measures to minimize or prevent erosion and sediment production. Such measures may include, but are not limited to:
(i) Avoiding steep slopes and excessive land clearing when siting structures, facilities, and other improvements; and
(ii) Temporarily suspending operations when frozen ground, thawing, or other weather-related conditions would cause otherwise avoidable or excessive impacts.
(4) Safety measures. The operator must maintain structures, facilities, improvements, and equipment in a safe condition in accordance with the approved APD. The operator must also take appropriate measures as specified in Notices to Lessees to protect the public from any hazardous conditions resulting from operations.
(i) In the event of an emergency, the operator may take immediate action without prior surface managing agency approval to safeguard life or to prevent significant environmental degradation. The BLM or the FS must receive notification of the emergency situation and the remedial action taken by the operator as soon as possible, but not later than 24 hours after the emergency occurred. If the emergency only affected drilling operations and had no surface impacts, only the BLM must be notified.
(ii) If the emergency involved surface resources on other surface managing agency lands, the operator should also notify the surface managing agency and private surface owner within 24 hours.
(iii) Upon conclusion of the emergency, the BLM or the FS, where appropriate, will review the incident and take appropriate action.
(5) Completion reports. Within 30 days after the well completion, the lessee or operator must submit to the BLM two copies of a completed Form 3160-4, Well Completion or Recompletion Report and Log. Well logs may be submitted to the BLM in an electronic format such as “.LAS” format. Surface and bottom-hole locations must be in latitude and longitude.
§ 3171.18   Rights-of-Way and Special Use Authorizations.
(a) The BLM or the FS will notify the operator of any additional Rights-of-Way, Special Use Authorizations, licenses, or other permits that are needed for roads and support facilities for drilling or off-lease access, as appropriate. This notification will normally occur at the time the operator submits the APD or Notice of Staking package, or Sundry Notice, or during the onsite inspection.
(b) The BLM or the FS, as appropriate, will approve or accept on-lease activities that are associated with actions proposed in the APD or Sundry Notice and that will occur on the lease as part of the APD or Sundry Notice. These actions do not require a Right-of- Way or Special Use Authorization. For pipeline Rights-of-Way crossing lands under the jurisdiction of two or more Federal surface managing agencies, except lands in the National Park Service or Indian lands, applications should be submitted to the BLM. Refer to 43 CFR parts 2800 and 2880 for guidance on BLM Rights-of-Way and 36 CFR part 251 for guidance on FS Special Use Authorizations.
(1) Rights-of-Way (BLM). (i) For BLM lands, the APD package may serve as the supporting document for the Right-of-Way application in lieu of a Right-of-Way plan of development.
(ii) Any additional information specified in 43 CFR parts 2800 and 2880 will be required in order to process the Right- of-Way. The BLM will notify the operator within 10 days of receipt of a Notice of Staking, APD, or other notification if any parts of the project require a Right- of-Way. If a Right-of-Way is needed, the information required from the operator to approve the Right-of-Way may be submitted by the operator with the APD package if the Notice of Staking option has been used.
(2) Special Use Authorizations (FS) (36 CFR part 251, subpart B). When a Special Use Authorization is required, the Surface Use Plan of Operations may serve as the application for the Special Use Authorization if the facility for which a Special Use Authorization is required is adequately described (see 36 CFR 251.54(d)(ii)). Conditions regulating the authorized use may be imposed to protect the public interest, to ensure compatibility with other NFS lands programs and activities consistent with the Forest Land and Resources Management Plan. A Special Use Authorization, when related to an APD, will include terms and conditions (36 CFR 251.56) and may require a specific reclamation plan or adopt applicable parts of the Surface Use Plan of Operations by reference.
§ 3171.19   Operating on lands with non-Federal surface and Federal oil and gas.
(a) The operator must submit the name, address, and phone number of the surface owner, if known, in its APD. The BLM will invite the surface owner to the onsite inspection to assure that their concerns are considered. As provided in the oil and gas lease, the BLM may request that the applicant conduct surveys or otherwise provide information needed for the BLM's National Historic Preservation Act consultation with the State Historic Preservation Officer or Indian tribe or its Endangered Species Act consultation with the relevant fisheries agency. The Federal mineral lessee has the right to enter the property for the purpose set out in the preceding sentence, since it is a necessary prerequisite to development of the dominant mineral estate. Nevertheless, the lessee or operator should seek to reach agreement with the surface owner about the time and method by which any survey would be conducted.
(b) Likewise, in the case of actual oil and gas operations, the operator must make a good faith effort to notify the private surface owner before entry and make a good faith effort to obtain a Surface Access Agreement from the surface owner. This section also applies to lands with Indian trust surface and Federal minerals. In these cases, the operator must make a good faith effort to obtain surface access agreement with the tribe in the case of tribally owned surface, otherwise with the majority of the Indian surface owners who can be located with the assistance and concurrence of the BIA. The Surface Access Agreement may include terms or conditions of use, be a waiver, or an agreement for compensation. The operator must certify to the BLM that:
(1) It made a good faith effort to notify the surface owner before entry; and
(2) That an agreement with the surface owner has been reached or that a good faith effort to reach an agreement failed. If no agreement was reached with the surface owner, the operator must submit an adequate bond (minimum of $1,000) to the BLM for the benefit of the surface owner sufficient to:
(i) Pay for loss or damages; or
(ii) As otherwise required by the specific statutory authority under which the surface was patented and the terms of the lease.
(c) Surface owners have the right to appeal the sufficiency of the bond. Before the approval of the APD, the BLM will make a good faith effort to contact the surface owner to assure that they understand their rights to appeal.
(d) The BLM must comply with NEPA, the National Historic Preservation Act, the Endangered Species Act, and related Federal statutes when authorizing lease operations on split estate lands where the surface is not federally owned and the oil and gas is Federal. For split estate lands within FS administrative boundaries, the BLM has the lead responsibility, unless there is a local BLM/FS agreement that gives the FS this responsibility.
(e) The operator must make a good faith effort to provide a copy of their Surface Use Plan of Operations to the surface owner. After the APD is approved the operator must make a good faith effort to provide a copy of the Conditions of Approval to the surface owner. The APD approval is not contingent upon delivery of a copy of the Conditions of Approval to the surface owner.
§ 3171.20   Leases for Indian oil and gas.
(a) Approval of operations. The BLM will process APDs, Master Development Plans, and Sundry Notices on Indian tribal and allotted oil and gas leases, and Indian Mineral Development Act mineral agreements in a manner similar to Federal leases. For processing such applications, the BLM considers the BIA to be the surface managing agency. Operators are responsible for obtaining any special use or access permits from appropriate BIA and, where applicable, tribal offices. The BLM is not required to post for public inspection APDs for minerals subject to Indian oil and gas leases or agreements.
(b) Surface use. Where the wellsite and/or access road is proposed on Indian lands with a different beneficial owner than the minerals, the operator is responsible for entering into a surface use agreement with the Indian tribe or the individual Indian surface owner, subject to BIA approval. This agreement must specify the requirements for protection of surface resources, mitigation, and reclamation of disturbed areas. The BIA, the Indian surface owner, and the BLM, pursuant to 25 CFR 211.4, 212.4 and 225.4, will develop the Conditions of Approval. If the operator is unable to obtain a Surface Access Agreement, it may provide a bond for the benefit of the surface owner(s) (see § 3171.19).
§ 3171.21   Subsequent operations and Sundry Notices.
Subsequent operations must follow 43 CFR part 3160, applicable lease stipulations, and APD Conditions of Approval. The operator must file the Sundry Notice in the BLM Field Office having jurisdiction over the lands described in the notice or the operator may file it using the BLM's electronic commerce system.
(a) Surface disturbing operations. (1) Lessees and operators must submit for BLM or FS approval a request on Form 3160-5 before:
(i) Undertaking any subsequent new construction outside the approved area of operations; or
(ii) Reconstructing or altering existing facilities including, but not limited to, roads, emergency pits, firewalls, flowlines, or other production facilities on any lease that will result in additional surface disturbance.
(2) If, at the time the original APD was filed, the lessee or operator elected to defer submitting information under § 3171.8(e)(4)(iii), the lessee or operator must supply this information before construction and installation of the facilities. The BLM, in consultation with any other involved surface managing agency, may require a field inspection before approving the proposal. The lessee or operator may not begin construction until the BLM approves the proposed plan in writing.
(3) The operator must certify on Form 3160-5 that they have made a good faith effort to provide a copy of any proposal involving new surface disturbance to the private surface owner in the case of split estate.
(b) Emergency repairs. Lessees or operators may undertake emergency repairs without prior approval if they promptly notify the BLM. Lessees or operators must submit sufficient information to the BLM or the FS to permit a proper evaluation of any:
(1) Resulting surface disturbing activities; or
(2) Planned accommodations necessary to mitigate potential adverse environmental effects.
§ 3171.22   Well conversions.
(a) Conversion to an injection well. When subsequent operations will result in a well being converted to a Class II injection well ( i.e., for disposal of produced water, oil and gas production enhancement, or underground storage of hydrocarbons), the operator must file with the appropriate BLM office a Sundry Notice, Notice of Intent to Convert to Injection on Form 3160-5. The BLM and the surface managing agency, if applicable, will review the information to ensure its technical and administrative adequacy. Following the review, the BLM, in consultation with the surface managing agency, where applicable, will decide upon the approval or disapproval of the application based upon relevant laws and regulations and the circumstances ( e.g., the well used for lease or non-lease operations, surface ownership, and protection of subsurface mineral ownership). The BLM will determine if a Right-of-Way or Special Use Authorization and additional bonding are necessary and notify the operator.
(b) Conversion to a water supply well. In cases where the surface managing agency or private surface owner desires to acquire an oil and gas well and convert it to a water supply well or acquire a water supply well that was drilled by the operator to support lease operations, the surface managing agency or private surface owner must inform the appropriate BLM office of its intent before the approval of the APD in the case of a dry hole and no later than the time a Notice of Intent to Abandon is submitted for a depleted production well. The operator must abandon the well according to BLM instructions, and must complete the surface cleanup and reclamation, in conjunction with the approved APD, Surface Use Plan of Operations, or Notice of Intent to Abandon, if the BLM or the FS require it. The surface managing agency or private surface owner must reach agreement with the operator as to the satisfactory completion of reclamation operations before the BLM will approve any abandonment or reclamation. The BLM approval of the partial abandonment under this section, completion of any required reclamation operations, and the signed release agreement will relieve the operator of further obligation for the well. If the surface managing agency or private surface owner acquires the well for water use purposes, the party acquiring the well assumes liability for the well.
§ 3171.23   Variances.
The operator may make a written request to the agency with jurisdiction to request a variance from this subpart. A request for a variance must explain the reason the variance is needed and demonstrate how the operator will satisfy the intent of this subpart. The operator may include the request in the APD package. A variance from the requirements of this subpart does not constitute a variance to provisions of other regulations, laws, or orders. When the BLM is the decision maker on a request for a variance, the decision whether to grant or deny the variance request is entirely within the BLM's discretion. The decision on a variance request is not subject to administrative appeals either to the State Director or pursuant to 43 CFR part 4.
§ 3171.24   Waivers, exceptions, or modifications.
(a) An operator may also request that the BLM waive (permanently remove), except (case-by-case exemption), or modify (permanently change) a lease stipulation for a Federal lease. In the case of Federal leases, a request to waive, except, or modify a stipulation should also include information demonstrating that the factors leading to its inclusion in the lease have changed sufficiently to make the protection provided by the stipulation no longer justified or that the proposed operation would not cause unacceptable impacts.
(b) When the waiver, exception, or modification is substantial, the proposed waiver, exception, or modification is subject to public review for 30 days. Prior to such public review, the BLM, and when applicable the FS, will post it in their local Field Office and, when possible, electronically on the internet. When the request is included in the Notice of Staking or APD, the request will be included as part of the application posting under § 3171.5(c). Prior to granting a waiver, exception, or modification, the BLM will obtain the concurrence or approval of the FS or Federal surface managing agency. Decisions on such waivers, exceptions, or modifications are subject to appeal pursuant to 43 CFR part 4.
(c) After drilling has commenced, the BLM and the FS may consider verbal requests for waivers, exceptions, or modifications. However, the operator must submit a written notice within 7 days after the verbal request. The BLM and the FS will confirm in writing any verbal approval. Decisions on waivers, exceptions, or modifications submitted after drilling has commenced are final for the Department of the Interior and not subject to administrative review by the State Director or appeal pursuant to 43 CFR part 4.
§ 3171.25   Abandonment.
In accordance with the requirements of 43 CFR 3162.3-4, before starting abandonment operations the operator must submit a Notice of Intent to Abandon on Sundry Notices and Reports on Wells, Form 3160-5. If the operator proposes to modify the plans for surface reclamation approved at the APD stage, the operator must attach these modifications to the Notice of Intent to Abandon.
(a) Plugging. The operator must obtain BLM approval for the plugging of the well by submitting a Notice of Intent to Abandon. In the case of dry holes, drilling failures, and in emergency situations, verbal approval for plugging may be obtained from the BLM, with the Notice of Intent to Abandon promptly submitted as written documentation. Within 30 days following completion of well plugging, the operator must file with the BLM a Subsequent Report of Plug and Abandon, using Sundry Notices and Reports on Wells, Form 3160-5. For depleted production wells, the operator must submit a Notice of Intent to Abandon and obtain the BLM's approval before plugging.
(b) Reclamation. Plans for surface reclamation are a part of the Surface Use Plan of Operations, as specified in § 3171.8(e)(10), and must be designed to return the disturbed area to productive use and to meet the objectives of the land and resource management plan. If the operator proposes to modify the plans for surface reclamation approved at the APD stage, the operator must attach these modifications to the Subsequent Report of Plug and Abandon using Sundry Notices and Reports on Wells, Form 3160-5.
(1) For wells not having an approved plan for surface reclamation, operators must submit to the BLM a proposal describing the procedures to be followed for complete abandonment, including a map showing the disturbed area and roads to be reclaimed. The BLM will forward the request to the FS or other surface managing agency. If applicable, the private surface owner will be notified and their views will be carefully considered.
(2) Earthwork for interim and final reclamation must be completed within 6 months of well completion or well plugging (weather permitting). All pads, pits, and roads must be reclaimed to a satisfactorily revegetated, safe, and stable condition, unless an agreement is made with the landowner or surface managing agency to keep the road or pad in place. Pits containing fluid must not be breached (cut) and pit fluids must be removed or solidified before backfilling. Pits may be allowed to air dry subject to BLM or FS approval, but the use of chemicals to aid in fluid evaporation, stabilization, or solidification must have prior BLM or FS approval. Seeding or other activities to reestablish vegetation must be completed within the time period approved by the BLM or the FS.
(3) Upon completion of reclamation operations, the lessee or operator must notify the BLM or the FS using Form 3160-5, Final Abandonment Notice, when the location is ready for inspection. Final abandonment will not be approved until the surface reclamation work required in the Surface Use Plan of Operations or Subsequent Report of Plug and Abandon has been completed to the satisfaction of the BLM or the FS and surface managing agency, if appropriate.
§ 3171.26   Appeal procedures.
(a) Complete information concerning the review and appeal processes for BLM actions is contained in 43 CFR parts 4 and 3160, subpart 3165. Incorporation of a FS approved Surface Use Plan of Operations into the approval of an APD or a Master Development Plan is not subject to protest to the BLM or appeal to the Interior Board of Land Appeals.
(b) The FS's decisions approving use of NFS lands may be subject to agency appeal procedures, in accordance with 36 CFR part 215 or 251.
(c) Decisions governing Surface Use Plan of Operations and Special Use Authorization approvals on NFS lands that involve analysis, documentation, and other requirements of the NEPA may be subject to agency appeal procedures, under 36 CFR part 215.
(d) The FS's regulations at 36 CFR part 251 govern appeals by an operator of written FS decisions related to Conditions of Approval or administration of Surface Use Plans of Operations or Special Use Authorizations to occupy and use NFS lands.
(e) The operator may appeal decisions of the BIA under 25 CFR part 2.
§ 3172.1   Authority.
(a) This subpart is established pursuant to the authority granted to the Secretary of the Interior pursuant to various Federal and Indian mineral leasing statutes and the Federal Oil and Gas Royalty Management Act of 1982. This authority has been delegated to the Bureau of Land Management and is implemented by the onshore oil and gas operating regulations contained in 43 CFR part 3160.
(b) Specific authority for the provisions contained in this subpart is found at: 43 CFR 3162.3-1, 3162.3-4, 3162.4-1, 3162.4-3, 3162.5-1, 3162.5-2 (see paragraph (a)), and 3162.5-3; and 43 CFR part 3160, subpart 3163.
§ 3172.2   Purpose.
This subpart details the Bureau's uniform national standards for the minimum levels of performance expected from lessees and operators when conducting drilling operations on Federal and Indian lands (except Osage Tribe) and for abandonment immediately following drilling. The purpose also is to identify the enforcement actions that will result when violations of the minimum standards are found, and when those violations are not abated in a timely manner.
§ 3172.3   Scope.
This subpart is applicable to all onshore Federal and Indian (except Osage Tribe) oil and gas leases.
§ 3172.4   General.
(a) If an operator chooses to use higher rated equipment than that authorized in the Application for Permit to Drill (APD), testing procedures shall apply to the approved working pressures, not the upgraded higher working pressures.
(b) Some situations may exist either on a well-by-well or field-wide basis whereby it is commonly accepted practice to vary a particular minimum standard(s) established in this subpart. This situation may be resolved by requesting a variance (see § 3172.13), by the inclusion of a stipulation to the APD, or by the issuance of a Notice to Lessees and Operators (NTL) by the appropriate BLM office.
(c) When a violation is discovered, and if it does not cause or threaten immediate substantial and adverse impact on public health and safety, the environment, production accountability or royalty income, it will be classified as minor. The violation may be reissued as a major violation if not corrected during the abatement period and continued drilling has changed the adverse impact of the violation so that it meets the specific definition of a major violation.
(d) This subpart is not intended to circumvent the reporting requirements or compliance aspects that may be stated elsewhere in existing NTLs, regulations, etc. A lessee's compliance with the requirements of the regulations in this subpart shall not relieve the lessee of the obligation to comply with other applicable laws and regulations in accordance with 43 CFR 3162.5-1(c). Lessees should give special attention to the automatic assessment provisions in 43 CFR 3163.1(b).
(e) This subpart is based upon the assumption that operations have been approved in accordance with 43 CFR part 3160 and subpart 3171 of this part. Failure to obtain approval prior to commencement of drilling or related operations shall subject the operator to immediate assessment under 43 CFR 3163.1(b)(2).
§ 3172.5   Definitions.
As used in this subpart, the term:
2M, 3M, 5M, 10M, and 15M mean the pressure ratings used for equipment with a working pressure rating of the equivalent thousand pounds per square inch (psi) (2M=2,000 psi, 3M=3,000 psi, etc.).
Abnormal pressure zone means a zone that has either pressure above or below the normal gradient for an area and/or depth.
Bleed line means the vent line that bypasses the chokes in the choke manifold system; also referred to as panic line.
Blooie line means a discharge line used in conjunction with a rotating head.
Drilling spool means a connection component with both ends either flanged or hubbed, with an internal diameter at least equal to the bore of the casing, and with smaller side outlets for connecting auxiliary lines.
Exploratory well means any well drilled beyond the known producing limits of a pool.
Fill-up line means the line used to fill the hole when the drill pipe is being removed from the well. It is usually connected to a 2-inch collar that is welded into a drilling nipple.
Flare line means a line used to carry gas away from the rig to be burned at a safer location. The gas comes from the degasser, gas buster, separator, or when drill stem testing, directly from the drill pipe.
Functionally operated means activating equipment without subjecting it to well-bore pressure.
Isolating means using cement to protect, separate, or segregate usable water and mineral resources.
Lease means any contract, profit-share agreement, joint venture, or other agreement issued or approved by the United States under a mineral leasing law that authorizes exploration for, extraction of, or removal of oil or gas (see 43 CFR 3160.0-5).
Lessee means a person holding record title in a lease issued by the United States (see 43 CFR 3160.0-5).
Make-up water means water that is used in mixing slurry for cement jobs and plugging operations and is compatible with the cement constituents being used.
Manual locking device means any manually activated device, such as a hand wheel, etc., that is used for the purpose of locking the preventer in the closed position.
Mud for plugging purposes means a slurry of bentonite or similar flocculent/viscosifier, water, and additives needed to achieve the desired weight and consistency to stabilize the hole.
Mudding up means adding materials and chemicals to water to control the viscosity, weight, and filtrate loss of the circulating system.
Operating rights owner (or owner) means a person or entity holding operating rights in a lease issued by the United States. A lessee also may be an operating rights owner if the operating rights in a lease or portion thereof have not been severed from record title.
Operational means capable of functioning as designed and installed without undue force or further modification.
Operator means any person or entity, including but not limited to the lessee or operating rights owner, who has stated in writing to the authorized officer his/her responsibility for the operations conducted in the leased lands or a portion thereof.
Precharge pressure means the nitrogen pressure remaining in the accumulator after all the hydraulic fluid has been expelled from beneath the movable barrier.
Prompt correction means immediate correction of violations, with drilling suspended if required in the discretion of the authorized officer.
Prospectively valuable deposit of minerals means any deposit of minerals that the authorized officer determines to have characteristics of quantity and quality that warrant its protection.
Tagging the plug means running in the hole with a string of tubing or drill pipe and placing sufficient weight on the plug to ensure its integrity. Other methods of tagging the plug may be approved by the authorized officer.
Targeted tee or turn means a fitting used in pressure piping in which a bull plug or blind flange of the same pressure rating as the rest of the approved system is installed at the end of a tee or cross, opposite the fluid entry arm, to change the direction of flow and to reduce erosion.
Usable water means generally those waters containing up to 10,000 parts per million (ppm) of total dissolved solids.
Weep hole means a small hole that allows pressure to bleed off through the metal plate used in covering well bores after abandonment operations.
§ 3172.6   Well control.
(a) Requirements. Blowout preventer (BOP) and related equipment (BOPE) shall be installed, used, maintained, and tested in a manner necessary to assure well control and shall be in place and operational prior to drilling the surface casing shoe unless otherwise approved by the APD. Commencement of drilling without the approved BOPE installed, unless otherwise approved, shall subject the operator to immediate assessment under 43 CFR 3163.1(b)(1). The BOP and related control equipment shall be suitable for operations in those areas which are subject to sub-freezing conditions. The BOPE shall be based on known or anticipated sub-surface pressures, geologic conditions, accepted engineering practice, and surface environment. Item number 7 of the 8 point plan in the APD specifically addresses expected pressures. The working pressure of all BOPE shall exceed the anticipated surface pressure to which it may be subjected, assuming a partially evacuated hole with a pressure gradient of 0.22 psi/ft.
(b) Violation classifications. The gravity of the violation for many of the well control minimum standards listed in paragraphs (b)(1) through (9) of this section are shown as minor. However, very short abatement periods in this subpart are often specified in recognition that by continuing to drill, the violation which was originally determined to be of a minor nature may cause or threaten immediate, substantial, and adverse impact on public health and safety, the environment, production accountability, or royalty income, which would require it reclassification as a major violation.
(1) Minimum standards and enforcement provisions for well control equipment. (i) A well control device shall be installed at the surface that is capable of complete closure of the well bore. This device shall be closed whenever the well is unattended.
Table 1 to § 3172.6( b )(1)( i )
(ii) For 2M system:
(A) Annular preventer, double ram, or two rams with one being blind and one being a pipe ram (major);
(B) Kill line (2 inch minimum);
(C) 1 kill line valve (2 inch minimum);
(D) 1 choke line valve;
(E) 2 chokes (refer to diagram in appendix A to this subpart);
(F) Upper kelly cock valve with handle available;
(G) Safety valve and subs to fit all drill strings in use;
(H) Pressure gauge on choke manifold;
(I) 2 inch minimum choke line; and
(J) Fill-up line above the uppermost preventer.
Table 2 to § 3172.6( b )(1)( ii )
(iii) For 3M system:
(A) Annular preventers (major);
(B) Double ram with blind rams and pipe rams (major);
(C) Drilling spool, or blowout preventer with 2 side outlets (choke side shall be a 3-inch minimum diameter, kill side shall be at least 2-inch diameter) (major);
(D) Kill line (2 inch minimum);
(E) A minimum of 2 choke line valves (3 inch minimum) (major);
(F) 3 inch diameter choke line;
(G) 2 kill line valves, one of which shall be a check valve (2 inch minimum) (major);
(H) 2 chokes (refer to diagram in appendix A to this subpart);
(I) Pressure gauge on choke manifold;
(J) Upper kelly cock valve with handle available;
(K) Safety valve and subs to fit all drill string connections in use;
(L) All BOPE connections subjected to well pressure shall be flanged, welded, or clamped (major); and
(M) Fill-up line above the uppermost preventer.
Table 3 to § 3172.6( b )(1)( iii )
(iv) For 5M system:
(A) Annular preventer (major);
(B) Pipe ram, blind ram, and, if conditions warrant, as specified by the authorized officer, another pipe ram shall also be required (major);
(C) A second pipe ram preventer or variable bore pipe ram preventer shall be used with a tapered drill string;
(D) Drilling spool, or blowout preventer with 2 side outlets (choke side shall be a 3-inch minimum diameter, kill side shall be at least 2-inch diameter) (major);
(E) 3 inch diameter choke line;
(F) 2 choke line valves (3 inch minimum) (major);
(G) Kill line (2 inch minimum);
(H) 2 chokes with 1 remotely controlled from rig floor (refer to diagram in appendix A to this subpart);
(I) 2 kill line valves and a check valve (2 inch minimum) (major);
(J) Upper kelly cock valve with a handle available;
(K) When the expected pressures approach working pressure of the system, 1 remote kill line tested to stack pressure (which shall run to the outer edge of the substructure and be unobstructed);
(L) Lower kelly cock valve with handle available;
(M) Safety valve(s) and subs to fit all drill string connections in use;
(N) Inside BOP or float sub available;
(O) Pressure gauge on choke manifold;
(P) All BOPE connections subjected to well pressure shall be flanged, welded, or clamped (major); and
(Q) Fill-up line above the uppermost preventer.
Table 4 to § 3172.6( b )(1)( iv )
(v) For 10M & 15M system:
(A) Annular preventer (major);
(B) 2 pipe rams (major);
(C) Blind rams (major);
(D) Drilling spool, or blowout preventer with 2 side outlets (choke side shall be a 3-inch minimum diameter, kill side shall be at least 2-inch diameter) (major):
(E) 3 inch choke line (major);
(F) 2 kill line valves (2 inch minimum) and check valve (major):
(G) Remote kill line (2 inch minimum) shall run to the outer edge of the substructure and be unobstructed;
(H) Manual and hydraulic choke line valves (3 inch minimum) (major);
(I) 3 chokes, 1 being remotely controlled (refer to diagram in appendix A to this subpart);
(J) Pressure gauge on choke manifold;
(K) Upper kelly cock valve with handle available;
(L) Lower kelly cock valve with handle available;
(M) Safety valves and subs to fit all drill string connections in use;
(N) Inside BOP or float sub available;
(O) Wear ring in casing head;
(P) All BOPE connections subjected to well pressure shall be flanged, welded, or clamped (major); and
(Q) Fill-up line installed above the uppermost preventer.
Table 5 to § 3172.6( b )(1)( v )
(vi) If repair or replacement of the BOPE is required after testing, this work shall be performed prior to drilling out the casing shoe.
Table 6 to § 3172.6( b )(1)( vi )
(vii) When the BOPE cannot function to secure the hole, the hole shall be secured using cement, retrievable packer or a bridge plug packer, bridge plug, or other acceptable approved method to assure safe well conditions.
Table 7 to § 3172.6( b )(1)( vii )
(2) Minimum standards and enforcement provisions for choke manifold equipment. (i) All choke lines shall be straight lines unless turns use tee blocks or are targeted with running tees, and shall be anchored to prevent whip and reduce vibration.
Table 8 to § 3172.6( b )(2)( i )
(ii) Choke manifold equipment configuration shall be functionally equivalent to the appropriate example diagram shown in appendix A of this subpart. The configuration of the chokes may vary.
Table 9 to § 3172.6( b )(2)( ii )
(iii) All valves (except chokes) in the kill line, choke manifold, and choke line shall be a type that does not restrict the flow (full opening) and that allows a straight through flow (same enforcement as paragraph (b)(2)(ii) of this section).
(iv) Pressure gauges in the well control system shall be a type designed for drilling fluid service (same enforcement as paragraph (b)(2)(ii) of this section).
(3) Minimum standards and enforcement provisions for pressure accumulator system. (i) 2M system—accumulator shall have sufficient capacity to close all BOP's and retain 200 psi above precharge. Nitrogen bottles that meet manufacturer's specifications may be used as the backup to the required independent power source.
Table 10 to § 3172.6( b )(3)( i )
(ii) 3M system—accumulator shall have sufficient capacity to open the hydraulically controlled choke line valve (if so equipped), close all rams plus the annual preventer, and retain a minimum of 200 psi above precharge on the closing manifold without the use of the closing unit pumps. This is a minimum requirement. The fluid reservoir capacity shall be double the usable fluid volume of the accumulator system capacity and the fluid level of the reservoir shall be maintained at the manufacturer's recommendations. The 3M system shall have 2 independent power sources to close the preventers. Nitrogen bottles (3 minimum) may be 1 of the independent power sources and, if so, shall maintain a charge equal to the manufacturer's specifications.
Table 11 to § 3172.6( b )(3)( ii )
(iii) 5M and higher system—accumulator shall have sufficient capacity to open the hydraulically controlled gate valve (if so equipped) and close all rams plus the annular preventer (for 3 ram systems add a 50 percent safety factor to compensate for any fluid loss in the control system or preventers) and retain a minimum pressure of 200 psi above precharge on the closing manifold without use of the closing unit pumps. The fluid reservoir capacity shall be double the usable fluid volume of the accumulator system capacity and the fluid level of the reservoir shall be maintained at the manufacturer's recommendations. Two independent sources of power shall be available for powering the closing unit pumps. Sufficient nitrogen bottles are suitable as a backup power source only, and shall be recharged when the pressure falls below manufacturer's specifications.
Table 12 to § 3172.6( b )(3)( iii )
(4) Minimum standards and enforcement provisions for accumulator precharge pressure test. This test shall be conducted prior to connecting the closing unit to the BOP stack and at least once every 6 months. The accumulator pressure shall be corrected if the measured precharge pressure is found to be above or below the maximum or minimum limit specified in table 13 to this paragraph (b)(4) (only nitrogen gas may be used to precharge):
Table 13 to § 3172.6( b )(4)
Table 14 to § 3172.6( b )(4)
(5) Minimum standards and enforcement provisions for power availability. Power for the closing unit pumps shall be available to the unit at all times so that the pumps shall automatically start when the closing unit manifold pressure has decreased to a pre-set level.
Table 15 to § 3172.6( b )(5)
(6) Minimum standards and enforcement provisions for accumulator pump capacity. Each BOP closing unit shall be equipped with sufficient number and sizes of pumps so that, with the accumulator system isolated from service, the pumps shall be capable of opening the hydraulically operated gate valve (if so equipped), plus closing the annular preventer on the smallest size drill pipe to be used within 2 minutes, and obtain a minimum of 200 psi above specified accumulator precharge pressure.
Table 16 to § 3172.6( b )(6)
(7) Minimum standards and enforcement provisions for locking devices. A manual locking device ( i.e., hand wheels) or automatic locking devices shall be installed on all systems of 2M or greater. A valve shall be installed in the closing line as close as possible to the annular preventer to act as a locking device. This valve shall be maintained in the open position and shall be closed only when the power source for the accumulator system is inoperative.
Table 17 to § 3172.6( b )(7)
(8) Minimum standards and enforcement provisions for remote controls. Remote controls shall be readily accessible to the driller. Remote controls for all 3M or greater systems shall be capable of closing all preventers. Remote controls for 5M or greater systems shall be capable of both opening and closing all preventers. Master controls shall be at the accumulator and shall be capable of opening and closing all preventers and the choke line valve (if so equipped). No remote control for a 2M system is required.
Table 18 to § 3172.6( b )(8)
(9) Minimum standards and enforcement provisions for well control equipment testing. (i) Perform all tests described in paragraphs (b)(9)(ii) through (x) of this section using clear water or an appropriate clear liquid for subfreezing temperatures with a viscosity similar to water.
(ii) Ram type preventers and associated equipment shall be tested to approved (see § 3172.4(a)) stack working pressure if isolated by test plug or to 70 percent of internal yield pressure of casing if BOP stack is not isolated from casing. Pressure shall be maintained for at least 10 minutes or until requirements of test are met, whichever is longer. If a test plug is utilized, no bleed-off of pressure is acceptable. For a test not utilizing a test plug, if a decline in pressure of more than 10 percent in 30 minutes occurs, the test shall be considered to have failed. Valve on casing head below test plug shall be open during test of BOP stack.
(iii) Annular type preventers shall be tested to 50 percent of rated working pressure. Pressure shall be maintained at least 10 minutes or until provisions of test are met, whichever is longer.
(iv) As a minimum, the test in paragraphs (b)(9)(ii) and (iii) of this section shall be performed:
(A) When initially installed;
(B) Whenever any seal subject to test pressure is broken;
(C) Following related repairs; and
(D) At 30-day intervals.
(v) Valves shall be tested from working pressure side during BOPE tests with all down stream valves open.
(vi) When testing the kill line valve(s), the check valve shall be held open or the ball removed.
(vii) Annular preventers shall be functionally operated at least weekly.
(viii) Pipe and blind rams shall be activated each trip, however, this function need not be performed more than once a day.
(ix) A BOPE pit level drill shall be conducted weekly for each drilling crew.
(x) Pressure tests shall apply to all related well control equipment.
(xi) All of the tests described in paragraphs (b)(9)(ii) through (x) of this section and/or drills shall be recorded in the drilling log.
Table 19 to § 3172.6( b )(9)
§ 3172.7   Casing and cementing.
(a) Requirements. The proposed casing and cementing programs shall be conducted as approved to protect and/or isolate all usable water zones, potentially productive zones, lost circulation zones, abnormally pressured zones, and any prospectively valuable deposits of minerals. Any isolating medium other than cement shall receive approval prior to use. The casing setting depth shall be calculated to position the casing seat opposite a competent formation which will contain the maximum pressure to which it will be exposed during normal drilling operations. Determination of casing setting depth shall be based on all relevant factors, including: presence/absence of hydrocarbons; fracture gradients; usable water zones; formation pressures; lost circulation zones; other minerals; or other unusual characteristics. All indications of usable water shall be reported.
(1) Minimum design factors for tensions, collapse, and burst that are incorporated into the casing design by an operator/lessee shall be submitted to the authorized operator for his review and approval along with the APD for all exploratory wells or as otherwise specified by the authorized officer.
(2) Casing design shall assume formation pressure gradients of 0.44 to 0.50 psi per foot for exploratory wells (lacking better data).
(3) Casing design shall assume fracture gradients from 0.70 to 1.00 psi per foot for exploratory wells (lacking better data).
(4) Casing collars shall have a minimum clearance of 0.422 inches on all sides in the hole/casing annulus, with recognition that variances can be granted for justified exceptions.
(5) All waiting on cement times shall be adequate to achieve a minimum of 500 psi compressive strength at the casing shoe prior to drilling out.
(b) Minimum standards and enforcement provisions for casing and cementing. (1) All casing, except the conductor casing, shall be new or reconditioned and tested casing. All casing shall meet or exceed American Petroleum Institute (API) standards for new casing. The use of reconditioned and tested used casing shall be subject to approval by the authorized officer: approval will be contingent upon the wall thickness of any such casing being verified to be at least 87 1/2 percent of the nominal wall thickness of new casing.
Table 1 to § 3172.7( b )(1)
(2) For liners, a minimum of 100 feet of overlap between a string of casing and the next larger casing is required. The interval of overlap shall be sealed and tested. The liner shall be tested by a fluid entry or pressure test to determine whether a seal between the liner top and next larger string has been achieved. The test pressure shall be the maximum anticipated pressure to which the seal will be exposed. No test shall be required for liners that do not incorporate or need a seal mechanism.
Table 2 to § 3172.7( b )(2)
(3) The surface casing shall be cemented back to surface either during the primary cement job or by remedial cementing.
Table 3 to § 3172.7( b )(3)
(4) All of the tests described in paragraphs (b)(1) through (3) of this section shall be recorded in the drilling log.
Table 4 to § 3172.7( b )(4)
(5) All indications of usable water shall be reported to the authorized officer prior to running the next string of casing or before plugging orders are requested, whichever occurs first.
Table 5 to § 3172.7( b )(5)
(6) Surface casing shall have centralizers on the bottom 3 joints of the casing (a minimum of 1 centralizer per joint, starting with the shoe joint).
Table 6 to § 3172.7( b )(6)
(7) Top plugs shall be used to reduce contamination of cement by displacement fluid. A bottom plug or other acceptable technique, such as a suitable preflush fluid, inner string cement method, etc., shall be utilized to help isolate the cement from contamination by the mud fluid being displaced ahead of the cement slurry.
Table 7 to § 3172.7( b )(7)
(8) All casing strings below the conductor shall be pressure tested to 0.22 psi per foot of casing string length or 1,500 psi, whichever is greater, but not to exceed 70 percent of the minimum internal yield. If pressure declines more than 10 percent in 30 minutes, corrective action shall be taken.
Table 8 to § 3172.7( b )(8)
(9) On all exploratory wells, and on that portion of any well approved for a 5M BOPE system or greater, a pressure integrity test of each casing shoe shall be performed. Formation at the shoe shall be tested to a minimum of the mud weight equivalent anticipated to control the formation pressure to the next casing depth or at total depth of the well. This test shall be performed before drilling more than 20 feet of new hole.
Table 9 to § 3172.7( b )(9)
§ 3172.8   Mud program.
(a) Requirements. The characteristics, use, and testing of drilling mud and the implementation of related drilling procedures shall be designed to prevent the loss of well control. Sufficient quantities of mud materials shall be maintained or readily accessible for the purpose of assuring well control.
(b) Minimum standards and enforcement provisions for mud program and equipment. (1) Record slow pump speed on daily drilling report after mudding up.
Table 1 to § 3172.8( b )(1)
(2) Visual mud monitoring equipment shall be in place to detect volume changes indicating loss or gain of circulating fluid volume.
Table 2 to § 3172.8( b )(2)
(3) When abnormal pressures are anticipated, electronic/mechanical mud monitoring equipment shall be required, which shall include as a minimum: pit volume totalizer (PVT); stroke counter; and flow sensor.
Table 3 to § 3172.8( b )(3)
(4) A mud test shall be performed every 24 hours after mudding up to determine, as applicable: density, viscosity, gel strength, filtration, and pH.
Table 4 to § 3172.8( b )(4)
(5) A trip tank shall be used on 10M and 15M systems and on upgraded 5M systems as determined by the authorized officer.
Table 5 to § 3172.8( b )(5)
(6)(i) Gas detecting equipment shall be installed in the mud return system for exploratory wells or wells where abnormal pressure is anticipated, and hydrocarbon gas shall be monitored for pore pressure changes.
(ii) Hydrogen sulfide safety and monitoring equipment requirements may be found in subpart 3176 of this part.
Table 6 to § 3172.8( b )(6)( ii )
(7) All flare systems shall be designed to gather and burn all gas. The flare line(s) discharge shall be located not less than 100 feet from the well head, having straight lines unless turns are targeted with running tees, and shall be positioned downwind of the prevailing wind direction and shall be anchored. The flare system shall have an effective method for ignition. Where noncombustible gas is likely or expected to be vented, the system shall be provided supplemental fuel for ignition and to maintain a continuous flare.
Table 6 to § 3172.8( b )(7)
(8) A mud-gas separator (gas buster) shall be installed and operable for all systems of 10M or greater and for any system where abnormal pressure is anticipated beginning at a point at least 500 feet above any anticipated hydrocarbon zone of interest.
Table 8 to § 3172.8( b )(8)
§ 3172.9   Drill stem testing.
(a) Requirements. Initial opening of drill stem test tools shall be restricted to daylight hours unless specific approval to start during other hours is obtained from the authorized officer. However, drill stem tests (DSTs) may be allowed to continue at night if the test was initiated during daylight hours and the rate of flow is stabilized and if adequate lighting is available ( i.e., lighting which is adequate for visibility and vapor-proof for safe operations). Packers can be released, but tripping shall not begin before daylight, unless prior approval is obtained from the authorized officer. Closed chamber DSTs may be accomplished day or night.
(b) Minimum standards for drill stem testing. (1) A DST that flows to the surface with evidence of hydrocarbons shall be either reversed out of the testing string under controlled surface conditions, or displaced into the formation prior to pulling the test tool. This would involve providing some means for reserve circulation.
Table 1 to § 3172.9( b )(1)
(2) Separation equipment required for the anticipated recovery shall be properly installed before a test starts.
Table 2 to § 3172.9( b )(2)
(3) All engines within 100 feet of the wellbore that are required to “run” during the test shall have spark arresters or water-cooled exhausts.
Table 3 to § 3172.9( b )(3)
§ 3172.10   Special drilling operations.
(a) In addition to the equipment already specified elsewhere in this subpart, the following equipment shall be in place and operational during air/gas drilling:
(1) Properly lubricated and maintained rotating head (major);
(2) Spark arresters on engines or water-cooled exhaust (major);
(3) Blooie line discharge 100 feet from well bore and securely anchored;
(4) Straight run on blooie line unless otherwise approved;
(5) Deduster equipment (major);
(6) All cuttings and circulating medium shall be directed into a reserve or blooie pit (major);
(7) Float valve above bit (major);
(8) Automatic igniter or continuous pilot light on the blooie line (major);
(9) Compressors located in the opposite direction from the blooie line a minimum of 100 feet from the well bore; and
(10) Mud circulating equipment, water, and mud materials (does not have to be premixed) sufficient to maintain the capacity of the hole and circulating tanks or pits.
Table 1 to § 3172.10( a )
(b) Hydrogen sulfide operation is specifically addressed under subpart 3176 of this part.
§ 3172.11   Surface use.
(a) Responsibilities. Subpart 3171 of this part specifically addresses surface use. Subpart 3171 provides for safe operations, adequate protection of surface resources and uses, and other environmental components. The operator/lessee is responsible for, and liable for, all building, construction, and operating activities and subcontracting activities conducted in association with the APD. Requirements and special stipulations for surface use are contained in or attached to the approved APD.
(b) Minimum standards and enforcement provisions for surface use. The requirements and stipulations of approval shall be strictly adhered to by the operator/lessee and any contractors.
(c) Violation. If a violation is identified by the authorized officer he shall determine whether it is major or minor, considering the definitions in 43 CFR 3160.0-5, and shall specify the appropriate corrective action and abatement period.
§ 3172.12   Drilling abandonment.
(a) Requirements. The standards in paragraphs (a)(1) through (11) of this section apply to the abandonment of newly drilled dry or non- productive wells in accordance with § 3171.18 and 43 CFR 3162.3-4. Approval shall be obtained prior to the commencement of abandonment. All formations bearing usable-quality water, oil, gas, or geothermal resources, and/or a prospectively valuable deposit of minerals shall be protected. Approval may be given orally by the authorized officer before abandonment operations are initiated. This oral request and approval shall be followed by a written Notice of Intent to Abandon filed not later than the fifth business day following oral approval. Failure to obtain approval prior to commencement of abandonment operations shall result in immediate assessment of under 43 CFR 3163.1(b)(3). The hole shall be in static condition at the time any plugs are placed (this does not pertain to plugging lost circulation zones). Within 30 days of completion of abandonment, a subsequent report of abandonment shall be filed. Plugging design for an abandonment hole shall include the following:
(1) Open hole. (i) A cement plug shall be placed to extend at least 50 feet below the bottom (except as limited by total depth (TD) or plugged back total depth (PBTD)), to 50 feet above the top of:
(A) Any zone encountered during drilling which contains fluid or gas with a potential to migrate; and (B) Any prospectively valuable deposit of minerals.
(ii) All cement plugs, except the surface plug, shall have sufficient slurry volume to fill 100 feet of hole, plus an additional 10 percent of slurry for each 1,000 feet of depth.
(iii) No plug, except the surface plug, shall be less than 25 sacks without receiving specific approval from the authorized officer.
(iv) Extremely thick sections of a single formation may be secured by placing 100-foot plugs across the top and bottom of the formation, and in accordance with paragraph (a)(1)(ii) of this section.
(v) In the absence of productive zones or prospectively valuable deposits of minerals which otherwise require placement of cement plugs, long sections of open hole shall be plugged at least every 3,000 feet. Such plugs shall be placed across in-gauge sections of the hole, unless otherwise approved by the authorized officer.
(B)[Reserved]
(2) Cased hole. A cement plug shall be placed opposite all open perforations and extend to a minimum of 50 feet below (except as limited by TD or PBTD) to 50 feet above the perforated interval. All cement plugs, except the surface plug, shall have sufficient slurry volume to fill 100 feet of hole, plus an additional 10 percent of slurry for each 1,000 feet of depth. In lieu of the cement plug, a bridge plug is acceptable, provided:
(i) The bridge plug is set within 50 feet to 100 feet above the open perforations; (ii) The perforations are isolated from any open hole below; and (iii) The bridge plug is capped with 50 feet of cement. If a bailer is used to cap this plug, 35 feet of cement shall be sufficient.
(3) Casing removed from hole. If any casing is cut and recovered, a cement plug shall be placed to extend at least 50 feet above and below the stub. The exposed hole resulting from the casing removal shall be secured as required in paragraphs (a)(1)(i) and (ii) of this section.
(4) Cement plug. An additional cement plug placed to extend a minimum of 50 feet above and below the shoe of the surface casing (or intermediate string, as appropriate).
(5) Annular space. No annular space that extends to the surface shall be left open to the drilled hole below. If this condition exists, a minimum of the top 50 feet of annulus shall be plugged with cement.
(6) Isolating medium. Any cement plug which is the only isolating medium for a fresh water interval or a zone containing a prospectively valuable deposit of minerals shall be tested by tagging with the drill string. Any plugs placed where the fluid level will not remain static also shall be tested by either tagging the plug with the working pipe string, or pressuring to a minimum pump (surface) pressure of 1,000 psi, with no more than a 10 percent drop during a 15-minute period (cased hole only). If the integrity of any other plug is questionable, or if the authorized officer has specific concerns for which he/she orders a plug to be tested, it shall be tested in the same manner.
(7) Silica sand or silica flour. Silica sand or silica flour shall be added to cement exposed to bottom hole static temperatures above 230º F to prevent heat degradation of the cement.
(8) Surface plug. A cement plug of at least 50 feet shall be placed across all annuluses. The top of this plug shall be placed as near the eventual casing cutoff point as possible.
(9) Mud. Each of the intervals between plugs shall be filled with mud of sufficient density to exert hydrostatic pressure exceeding the greatest formation pressure encountered while drilling such interval. In the absence of other information at the time plugging is approved, a minimum mud weight of 9 pounds per gallon shall be specified.
(10) Surface cap. All casing shall be cut-off at the base of the cellar or 3 feet below final restored ground level (whichever is deeper). The well bore shall then be covered with a metal plate at least 1/4 inch thick and welded in place, or a 4-inch pipe, 10-feet in length, 4 feet above ground and embedded in cement as specified by the authorized officer. The well location and identity shall be permanently inscribed. A weep hole shall be left if a metal plate is welded in place.
(11) Cellar. The cellar shall be filled with suitable material as specified by the authorized officer and the surface restored in accordance with the instructions of the authorized officer.
(b) Minimum standard. All plugging orders shall be strictly adhered to.
Table 1 to § 3172.12( b )
§ 3172.13   Variances from minimum standards.
(a) An operator may request the authorized officer to approve a variance from any of the minimum standards prescribed in §§ 3172.6 through 3172.12. All such requests shall be submitted in writing to the appropriate authorized officer and provide information as to the circumstances which warrant approval of the variance(s) requested and the proposed alternative methods by which the related minimum standard(s) are to be satisfied. The authorized officer, after considering all relevant factors, if appropriate, may approve the requested variance(s) if it is determined that the proposed alternative(s) meet or exceed the objectives of the applicable minimum standard(s).
(b) Emergency or other situations of an immediate nature that could not be reasonably foreseen at the time of APD approval may receive oral approval. However, such requests shall be followed up by a written notice filed not later than the fifth business day following oral approval.
§ 3173.1   Definitions and acronyms.
(a) As used in this subpart, the term:
Access means the ability to:
(i) Add liquids to or remove liquids from any tank or piping system, through a valve or combination of valves or by moving liquids from one tank to another tank; or
(ii) Enter any component in a measuring system affecting the accuracy of the measurement of the quality or quantity of the liquid being measured.
Appropriate valves means those valves that must be sealed during the production or sales phase ( e.g., fill lines, equalizer, overflow lines, sales lines, circulating lines, or drain lines).
Authorized representative (AR) has the same meaning as defined in 43 CFR 3160.0-5.
Business day means any day Monday through Friday, excluding Federal holidays.
Commingling and allocation approval (CAA) means a formal allocation agreement to combine production from two or more sources (leases, unit PAs, CAs, or non-Federal or non-Indian properties) before that product reaches an FMP.
Economically marginal property means a lease, unit PA, or CA that does not generate sufficient revenue above operating costs, such that a prudent operator would opt to plug a well or shut-in the lease, unit PA, or CA instead of making the investments needed to achieve non-commingled measurement of production from that lease, unit PA, or CA. A lease, unit PA, or CA may be regarded as economically marginal if the operator demonstrates that the expected revenue (net any associated operating costs) generated from crude oil or natural gas production volumes on that property is not sufficient to cover the nominal cost of the capital expenditures required to achieve measurement of non-commingled production of oil or gas from that property over a payout period of 18 months. A lease, unit PA, or CA can also be considered economically marginal if the operator demonstrates that its royalty net present value (RNPV), or the discounted value of the Federal or Indian royalties collected on revenue earned from crude oil or natural gas production on the lease, unit PA, or CA, over the expected life of the equipment that would need to be installed to achieve non-commingled measurement volumes, is less than the capital cost of purchasing and installing this equipment. Both the payout period and the RNPV are determined separately for each lease, unit PA, or CA oil or gas FMP. Additionally, oil FMPs are evaluated using estimated revenue (net of taxes and operating costs) from crude oil production, as defined in this section, while gas FMPs are evaluated using estimated revenue (net of taxes and operating costs) from natural gas production, as defined in this section.
Effectively sealed means the placement of a seal in such a manner that the sealed component cannot be accessed, moved, or altered without breaking the seal.
Free water means the measured volume of water that is present in a container and that is not in suspension in the contained liquid at observed temperature.
Land description means a location surveyed in accordance with the U.S. Department of the Interior's Manual of Surveying Instructions (2009), that includes the quarter-quarter section, section, township, range, and principal meridian, or other authorized survey designation acceptable to the AO, such as metes-and-bounds, or latitude and longitude.
Maximum ultimate economic recovery has the same meaning as defined in 43 CFR 3160.0-5.
Mishandling means failing to measure or account for removal of production from a facility.
Payout period means the time required, in months, for the cost of an investment in an oil or gas FMP for a specific lease, unit PA, or CA to be covered by the nominal revenue earned from crude oil production, for an oil FMP, or natural gas production, for a gas FMP, minus taxes, royalties, and any operating and variable costs. The payout period is determined separately for each oil or gas FMP for a given lease, unit PA, or CA.
Permanent measurement facility means all equipment constructed or installed and used on-site for 6 months or longer, for the purpose of determining the quantity, quality, or storage of production, and which meets the definition of FMP under § 3170.3.
Piping means a tubular system ( e.g., metallic, plastic, fiberglass, or rubber) used to move fluids (liquids and gases).
Production phase means that event during which oil is delivered directly to or through production equipment to the storage facilities and includes all operations at the facility other than those defined by the sales phase.
Royalty Net Present Value (RNPV) means the net present value of all Federal or Indian royalties paid on revenue earned from crude oil production or natural gas production from an oil or gas FMP for a given lease, unit PA, or CA over the expected life of metering equipment that must be installed for that lease, unit PA, or CA to achieve non-commingled measurement.
Sales phase means that event during which oil is removed from storage facilities for sale at an FMP.
Seal means a uniquely numbered device that completely secures either a valve or those components of a measuring system that affect the quality or quantity of the oil being measured.
(b) As used in this subpart, the following additional acronyms apply:
BIA means the Bureau of Indian Affairs.
BMP means Best Management Practice.
§ 3173.2   Storage and sales facilities—seals.
(a) All lines entering or leaving any oil storage tank must have valves capable of being effectively sealed during the production and sales phases unless otherwise provided under this subpart. During the production phase, all appropriate valves that allow unmeasured production to be removed from storage must be effectively sealed in the closed position. During any other phase (sales, water drain, or hot oiling), and prior to taking the top tank gauge measurement, all appropriate valves that allow unmeasured production to enter or leave the sales tank must be effectively sealed in the closed position (see Appendix A to subpart 3173). Each unsealed or ineffectively sealed appropriate valve is a separate violation.
(b) Valves or combinations of valves and tanks that provide access to the production before it is measured for sales are considered appropriate valves and are subject to the seal requirements of this subpart (see Appendix A to subpart 3173). If there is more than one valve on a line from a tank, the valve closest to the tank must be sealed. All appropriate valves must be in an operable condition and accurately reflect whether the valve is open or closed.
(c) The following are not considered appropriate valves and are not subject to the sealing requirements of this subpart:
(1) Valves on production equipment ( e.g., separator, dehydrator, gun barrel, or wash tank);
(2) Valves on water tanks, provided that the possibility of access to production in the sales and storage tanks does not exist through a common circulating, drain, overflow, or equalizer system;
(3) Valves on tanks that contain oil that has been determined by the AO or AR to be waste or slop oil;
(4) Sample cock valves used on piping or tanks with a Nominal Pipe Size of 1 inch or less in diameter;
(5) Fill-line valves during shipment when a single tank with a nominal capacity of 500 barrels (bbl) or less is used for collecting marginal production of oil produced from a single well ( i.e., production that is less than 3 bbl per day). All other seal requirements of this subpart apply;
(6) Gas line valves used on piping with a Nominal Pipe Size of 1 inch or less used as tank bottom “roll” lines, provided there is no access to the contents of the storage tank and the roll lines cannot be used as equalizer lines;
(7) Valves on tank heating systems that use a fluid other than the contents of the storage tank ( i.e., steam, water, or glycol);
(8) Valves used on piping with a Nominal Pipe Size of 1 inch or less connected directly to the pump body or used on pump bleed off lines;
(9) Tank vent-line valves; and
(10) Sales, equalizer, or fill-line valves on systems where production may be removed only through approved oil metering systems ( e.g., LACT or CMS). However, any valve that allows access for removing oil before it is measured through the metering system must be effectively sealed (see Appendix A to subpart 3173).
(d) Tampering with any appropriate valve is prohibited. Tampering with an appropriate valve may result in an assessment of civil penalties for knowingly or willfully preparing, maintaining, or submitting false, inaccurate, or misleading reports, records, or written information under 30 U.S.C. 1719(d)(1) and 43 CFR 3163.2(f)(1), or knowingly or willfully taking, removing, transporting, using, or diverting oil or gas from a lease site without valid legal authority under 30 U.S.C. 1719(d)(2) and 43 CFR 3163.2(f)(2), together with any other remedies provided by law.
§ 3173.3   Oil measurement system components—seals.
(a) Components used for quantity or quality determination of oil must be effectively sealed to indicate tampering, including, but not limited to, the following components of LACT meters (see § 3174.8(a)) and CMSs (see § 3174.9(e)):
(1) Sample probe;
(2) Sampler volume control;
(3) All valves on lines entering or leaving the sample container, excluding the safety pop-off valve (if so equipped). Each valve must be sealed in the open or closed position, as appropriate;
(4) Meter assembly, including the counter head and meter head;
(5) Temperature averager;
(6) LACT meters or CMS;
(7) Back pressure valve pressure adjustment downstream of the meter;
(8) Any drain valves in the system;
(9) Manual-sampling valves (if so equipped);
(10) Valves on diverter lines larger than 1 inch in nominal diameter;
(11) Right-angle drive;
(12) Totalizer; and
(13) Prover connections.
(b) Each missing or ineffectively sealed component is a separate violation.
§ 3173.4   Federal seals.
(a) In addition to any INC issued for a seal violation, the AO or AR may place one or more Federal seals on any appropriate valve, sealing device, or oil-metering-system component that does not comply with the requirements in §§ 3173.2 and 3173.3 if the operator is not present, refuses to cooperate with the AO or AR, or is unable to correct the noncompliance.
(b) The placement of a Federal seal does not constitute compliance with the requirements of §§ 3173.2 and 3173.3.
(c) A Federal seal may not be removed without the approval of the AO or AR.
§ 3173.5   Removing production from tanks for sale and transportation by truck.
(a) When a single truck load constitutes a completed sale, the driver must possess documentation containing the information required in § 3174.12.
(b) When multiple truckloads are involved in a sale and the oil measurement method is based on the difference between the opening and closing gauges, the driver of the last truck must possess the documentation containing the information required in § 3174.12. All other drivers involved in the sale must possess a trip log or manifest.
(c) After the seals have been broken, the purchaser or transporter is responsible for the entire contents of the tank until it is resealed.
§ 3173.6   Water-draining operations.
When water is drained from a production storage tank, the operator, purchaser, or transporter, as appropriate, must document the following information:
(a) Federal or Indian lease, unit PA, or CA number(s);
(b) The tank location by land description;
(c) The unique tank number and nominal capacity;
(d) Date of the opening gauge;
(e) Opening gauge (gauged manually or automatically), TOV, and free-water measurements, all to the nearest 1/2 inch;
(f) Unique identifying number of each seal removed;
(g) Closing gauge (gauged manually or automatically) and TOV measurement to the nearest 1/2 inch; and
(h) Unique identifying number of each seal installed.
§ 3173.7   Hot oiling, clean-up, and completion operations.
(a) During hot oil, clean-up, or completion operations, or any other situation where the operator removes oil from storage, temporarily uses it for operational purposes, and then returns it to storage on the same lease, unit PA, or communitized area, the operator must document the following information:
(1) Federal or Indian lease, unit PA, or CA number(s);
(2) Tank location by land description;
(3) Unique tank number and nominal capacity;
(4) Date of the opening gauge;
(5) Opening gauge measurement (gauged manually or automatically) to the nearest 1/2 inch;
(6) Unique identifying number of each seal removed;
(7) Closing gauge measurement (gauged manually or automatically) to the nearest 1/2 inch;
(8) Unique identifying number of each seal installed;
(9) How the oil was used; and
(10) Where the oil was used ( i.e., well or facility name and number).
(b) During hot oiling, line flushing, or completion operations or any other situation where the operator removes production from storage for use on a different lease, unit PA, or communtized area, the production is considered sold and must be measured in accordance with the applicable requirements of this subpart and reported as sold to ONRR on the OGOR under 30 CFR part 1210 subpart C for the period covering the production in question.
§ 3173.8   Report of theft or mishandling of production.
(a) No later than the next business day after discovery of an incident of apparent theft or mishandling of production, the operator, purchaser, or transporter must report the incident to the AO. All oral reports must be followed up with a written incident report within 10 business days of the oral report.
(b) The incident report must include the following information:
(1) Company name and name of the person reporting the incident;
(2) Lease, unit PA, or CA number, well or facility name and number, and FMP number, as appropriate;
(3) Land description of the facility location where the incident occurred;
(4) The estimated volume of production removed;
(5) The manner in which access was obtained to the production or how the mishandling occurred;
(6) The name of the person who discovered the incident;
(7) The date and time of the discovery of the incident; and
(8) Whether the incident was reported to local law enforcement agencies and/or company security.
§ 3173.9   Required recordkeeping for inventory and seal records.
(a) The operator must perform an end-of-month inventory (gauged manually or automatically) that records: TOV in storage (measured to the nearest 1/2 inch) subtracting free water, the volume not corrected for temperature/S&W, and the volume as reported to ONRR on the OGOR;
(1) The end-of-month inventory must be completed within ± 3 days of the last day of the calendar month; or
(2) The end of month inventory must be a calculated “end of month” inventory based on daily production that takes place between two measured inventories that are not more than 31, nor fewer than 20, days apart. The calculated monthly inventory is determined based on the following equation:
For example: If the first inventory measurement performed on January 12 is 125 bbl, the second inventory measurement performed on February 10 is 150 bbl, the gross sales volume between the first and second inventory is 198 bbl, and February is the calendar month for which the report is due. For purposes of this example, we assume February had 28 days and that the well was non-producing for two of those days.
(b) For each seal, the operator must maintain a record that includes:
(1) The unique identifying number of each seal and the valve or meter component on which the seal is or was used;
(2) The date of installation or removal of each seal;
(3) For valves, the position (open or closed) in which it was sealed; and
(4) The reason the seal was removed.
§ 3173.10   Form 3160-5, Sundry Notices and Reports on Wells.
(a) The operator must submit a Form 3160-5, Sundry Notices and Reports on Wells (Sundry Notice) for the following:
(1) Site facility diagrams (see § 3173.11);
(2) Request for an FMP number (see § 3173.12);
(3) Request for FMP amendments (see § 3173.13(b));
(4) Requests for approval of off-lease measurement (see § 3173.23);
(5) Request to amend an approval of off-lease measurement (see § 3173.23(k));
(6) Requests for approval of CAAs (see § 3173.15); and
(7) Request to modify a CAA (see § 3173.18).
(b) The operator must submit all Sundry Notices electronically to the BLM office having jurisdiction over the lease, unit, or CA using WIS, unless the submitter:
(1) Is a small business, as defined by the U.S. Small Business Administration; and
(2) Does not have access to the Internet.
§ 3173.11   Site facility diagram.
(a) A site facility diagram is required for all facilities.
(b) Except for the requirement to submit a Form 3160-5, Sundry Notice, with the site facility diagram, no format is prescribed for site facility diagrams. The diagram should be formatted to fit on an 8 1/2 x 11 sheet of paper, if possible, and must be legible and comprehensible to an individual with an ordinary working knowledge of oil field operations (see Appendix A to subpart 3173). If more than one page is required, each page must be numbered (in the format “N of X pages”).
(c) The diagram must:
(1) Reflect the position of the production and water recovery equipment, piping for oil, gas, and water, and metering or other measuring systems in relation to each other, but need not be to scale;
(2) Commencing with the header, identify all of the equipment, including, but not limited to, the header, wellhead, piping, tanks, and metering systems located on the site, and include the appropriate valves and any other equipment used in the handling, conditioning, or disposal of production and water, and indicate the direction of flow;
(3) Identify by API number the wells flowing into headers;
(4) If another operator operates a co-located facility, depict the co-located facility(ies) on the diagram or list them as an attachment and identify them by company name, facility name(s), lease, unit PA, or CA number(s), and FMP number(s);
(5) Indicate which valve(s) must be sealed and in what position during the production and sales phases and during the conduct of other production activities ( e.g., circulating tanks or drawing off water), which may be shown by an attachment, if necessary;
(6) When describing co-located facilities operated by one operator, include a skeleton diagram of the co-located facility(ies), showing equipment only. For storage facilities common to co-located facilities operated by one operator, one diagram is sufficient;
(7) Clearly identify the lease, unit PA, or CA to which the diagram applies, the land description of the facility, and the name of the company submitting the diagram, with co-located facilities being identified for each lease, unit PA, or CA;
(8) Clearly identify, on the diagram or as an attachment, all meters and measurement equipment. Specifically identify all approved and assigned FMPs; and
(9) If the operator claims royalty-free use, clearly identify the equipment for which the operator claims royalty-free use. The operator must either:
(i) For each engine, motor, or major component ( e.g., compressor, separator, dehydrator, heater-treater, or tank heater) powered by production from the lease, unit PA, or CA, state the volume (oil or gas) consumed (per day or per month) and how the volume is determined; or
(ii) Measure the volume used, by meter or tank gauge.
(d) At facilities for which the BLM will assign an FMP number under § 3173.12, the operator must submit a new site facility diagram as follows:
(1) For facilities that become operational after January 17, 2017, within 30 days after the BLM assigns an FMP; or
(2) For a facility that is in service on or before January 17, 2017, and that has a site facility diagram on file with the BLM that meets the minimum requirements of Onshore Oil and Gas Order 3, Site Security, an amended site facility diagram meeting the requirements of this section is not due until 30 days after the existing facility is modified, a non-Federal facility located on a Federal lease or federally approved unit or communitized area is constructed or modified, or there is a change in operator.
(e) At facilities for which an FMP number is not required under § 3173.12 ( e.g., facilities that dispose of produced water), the operator must submit a new site facility diagram as follows:
(1) For new facilities in service after January 17, 2017, the new site facility diagram must be submitted within 30 days after the facility becomes operational; or
(2) For a facility that is in service on or before January 17, 2017, and that has a site facility diagram on file with the BLM that meets the minimum requirements of Onshore Oil and Gas Order 3, Site Security, an amended site facility diagram meeting the requirements of this section is not due until 30 days after the existing facility is modified, a non-Federal facility located on a Federal lease or federally approved unit or communitized area is constructed or modified, or there is a change in operator.
(f) After a site facility diagram has been submitted that complies with the requirements of this part, the operator has an ongoing obligation to update and amend the diagram within 30 days after such facility is modified, a non-Federal facility located on a Federal lease or federally approved unit or communitized area is constructed or modified, or there is a change in operator.
§ 3173.12   Applying for a facility measurement point.
(a)(1) Unless otherwise approved, the FMP(s) for all Federal and Indian leases, unit PAs, or CAs must be located within the boundaries of the lease, unit, or communitized area from which the production originated and must measure only production from that lease, unit PA, or CA.
(2) Off-lease measurement or commingling and allocation of Federal or Indian production requires prior approval (see 43 CFR 3162.7-2, 3162.7-3, 3173.15, 3173.16, 3173.24, and 3173.25).
(b) The BLM will not approve as an FMP a gas processing plant tailgate meter located off the lease, unit, or communitized area.
(c) The operator must submit separate applications for approval of an FMP that measures oil produced from a lease, unit PA, or CA, or under a CAA that complies with the requirements of this subpart, and an FMP that measures gas produced from the same lease, unit PA, or CA, or under a CAA that complies with the requirements of this subpart. This requirement applies even if the measurement equipment or facilities are at the same location.
(d) For a permanent measurement facility that comes into service after January 17, 2017, the operator must apply for approval of the FMP before any production leaves the permanent measurement facility. This requirement does not apply to temporary measurement equipment used during well testing operations. After timely submission and prior to approval of an FMP request, an operator must use the lease, unit PA, or CA number for reporting production to ONRR, until the BLM assigns an FMP number, at which point the operator must use the FMP number for all reporting to ONRR as set forth in § 3173.13.
(e) For a permanent measurement facility in service on or before January 17, 2017, the operator must apply for BLM approval of an FMP within the time prescribed in this paragraph, based on the production level of any one of the leases, unit PAs, or CAs, whether or not they are part of a CAA. The deadline to apply for an FMP approval applies to both oil and gas measurement facilities measuring production from that lease, unit PA, or CA.
(1) For a stand-alone lease, unit PA, or CA that produced 10,000 Mcf or more of gas per month or 100 bbl or more of oil per month, by January 17, 2018.
(2) For a stand-alone lease, unit PA, or CA that produced 1,500 Mcf or more, but less than 10,000 Mcf of gas per month, or 10 bbl or more, but less than 100 bbl of oil per month, by January 17, 2019.
(3) For a stand-alone lease, unit PA, or CA that produced less than 1,500 Mcf of gas per month or less than 10 bbl of oil per month, January 17, 2020.
(4) For a stand-alone lease, unit PA, or CA that has not produced for a year or more before January 17, 2017, the operator must apply for an FMP prior to the resumption of production.
(5) The production levels identified in paragraphs (e)(1) through (3) of this section should be calculated using the average production of oil or gas over the 12 months preceding the effective date of this section or over the period the lease, unit PA, or CA has been in production, whichever is shorter.
(6) If the operator of any facility covered by this section applies for an FMP approval by the deadline in this paragraph, the operator may continue using the lease, unit PA, or CA number for reporting production to ONRR, until the BLM's assigns an FMP number, at which point the operator must use the FMP number for all reporting to ONRR as set forth in § 3173.13.
(7) If the operator fails to apply for an FMP approval by the deadline in this paragraph, the operator will be subject to an INC and may also be subject to an assessment of a civil penalty under 43 CFR part 3160, subpart 3163, together with any other remedy available under applicable law or regulation.
(f) All requests for FMP approval must include the following:
(1) A complete Sundry Notice requesting approval of each FMP;
(2) The applicable Measurement Type Code specified in WIS;
(3) Information about the equipment used for oil and gas measurement, including, for:
(i) “Gas measurement,” specify operator/purchaser/transporter unique station number, primary element (meter tube) size or serial number, and type of secondary device (mechanical or electronic);
(ii) “Oil measurement by tank gauge,” specify oil tank number or tank serial number and size in barrels or gallons for all tanks associated with measurement at an FMP; and
(iii) “Oil measurement by LACT or CMS,” specify whether the equipment is LACT or CMS and the associated oil tank number or tank serial number and size in barrels or gallons (there may be more than one tank associated with an FMP);
(4) Where production from more than one well will flow to the requested FMP, list the API well numbers associated with the FMP; and
(5) FMP location by land description.
(g) Request for approval of an FMP may be submitted concurrently with separate requests for off-lease measurement and/or CAA.
§ 3173.13   Requirements for approved facility measurement points.
(a) For an existing facility in service on or before January 17, 2017, an operator must start using an FMP number for reporting production to ONRR on its OGOR for the fourth production month after the BLM assigns the FMP number(s), and every month thereafter. (For example, for a facility that is assigned an FMP number on January 15, 2016, the effective date of the FMP is the May production report.) For a new facility in service after January 17, 2017, an operator must start using an FMP number for reporting production to ONRR on its OGOR for the first production month after the BLM assigns the FMP number(s), and every month thereafter. (For example, for a facility that is assigned an FMP number on January 15, 2016, the effective date of the FMP is the February production report.)
(b)(1) The operator must file a Sundry Notice that describes any changes or modifications made to the FMP within 30 days after the change. This requirement does not apply to temporary modifications ( e.g., for maintenance purposes). These include any changes and modifications to the information listed on an application submitted under § 3173.12.
(2) The description must include details such as the primary element, secondary element, LACT/CMS meter, tank number(s), and wells or facilities using the FMP.
(3) The Sundry Notice must specify what was changed and the effective date, and include, if appropriate, an amended site facility diagram (see § 3173.11).
§ 3173.14   Conditions for commingling and allocation approval (surface and downhole).
(a) Subject to the exceptions provided in paragraph (b) of this section, the BLM may grant a CAA only if the proposed allocation method used for any such commingled measurement does not have the potential to affect the determination of the total volume or quality of production on which royalty owed is determined for all the Federal or Indian leases, unit PAs, or CAs which are proposed for commingling, and only if the following criteria are met:
(1) The proposed commingling includes production from more than one:
(i) Federal lease, unit PA, or CA, where each lease, unit PA, or CA proposed for commingling has 100 percent Federal mineral interest, the same fixed royalty rate and, and the same revenue distribution;
(ii) Indian tribal lease, unit PA, or CA, where each lease, unit PA, or CA proposed for commingling is wholly owned by the same tribe and has the same fixed royalty rate;
(iii) Federal unit PA or CA where each unit PA or CA proposed for commingling has the same proportion of Federal interest, and which interest is subject to the same fixed royalty rate and revenue distribution. (For example, the BLM could approve a commingling request under this paragraph where an operator proposes to commingle two Federal CAs of mixed ownership and both CAs are 50 percent Federal/50 percent private, so long as the Federal interests have the same royalty rates and royalty distributions.); or
(iv) Indian unit PA or CA where each unit PA or CA proposed for commingling has the same proportion of Indian interests, and which interest is held by the same tribe and has the same fixed royalty rate; and
(2) The operator or operators provide a methodology acceptable to BLM for allocation among the properties from which production is to be commingled (including a method for allocating produced water), with a signed agreement if there is more than one operator;
(3) For each of the leases, unit PAs, or CAs proposed for inclusion in the CAA, the applicant demonstrates to the AO that a lease, unit PA, or CA proposed for inclusion is producing in paying quantities (or, in the case of Federal leases, capable of production in paying quantities) pending approval of the CAA; and
(4) The FMP(s) for the proposed CAA measure production originating only from the leases, unit PAs, or CAs in the CAA.
(b) The BLM may also approve a CAA in instances where the proposed commingling of production involves production from Federal or Indian leases, unit PAs, or CAs that do not meet the criteria of paragraph (a)(1) of this section ( e.g., the commingling of leases, unit PAs, or CAs with different royalty rates or different distributions of revenue, or where the commingling involves multiple mineral ownerships). In order to be approved, a CAA under this subparagraph must meet the requirements of paragraphs (a)(2) through (4) of this section and at least one of the following conditions:
(1) The Federal or Indian lease, unit PA, or CA meets the definition of an economically marginal property. However, if the BLM determines that a Federal or Indian lease, unit PA, or CA included in a CAA ceases to be an economically marginal property, then this condition is no longer met;
(2) The average monthly production over the preceding 12 months for each Federal or Indian lease, unit PA, or CA proposed for the CAA on an individual basis is less than 1,000 Mcf of gas per month, or 100 bbl of oil per month;
(3) A CAA that includes Indian leases, unit PAs, or CAs has been authorized under tribal law or otherwise approved by a tribe;
(4) The CAA covers the downhole commingling of production from multiple formations that are covered by separate leases, unit PAs, or CAs, where the BLM has determined that the proposed commingling from those formations is an acceptable practice for the purpose of achieving maximum ultimate economic recovery and resource conservation; or
(5) There are overriding considerations that indicate the BLM should approve a commingling application in the public interest notwithstanding potential negative royalty impacts from the allocation method. Such considerations could include topographic or other environmental considerations that make non-commingled measurement physically impractical or undesirable, in view of where additional measurement and related equipment necessary to achieve non-commingled measurement would have to be located.
§ 3173.15   Applying for a commingling and allocation approval.
To apply for a CAA, the operator(s) must submit the following, if applicable, to the BLM office having jurisdiction over the leases, unit PAs, or CAs from which production is proposed to be commingled:
(a) A completed Sundry Notice for approval of commingling and allocation (if off-lease measurement is a feature of the commingling and allocation proposal, then a separate Sundry Notice under § 3173.23 is not necessary as long as the information required under § 3173.23(b) through (e) and, where applicable, § 3173.23(f) through (i) is included as part of the request for approval of commingling and allocation);
(b) A completed Sundry Notice for approval of off-lease measurement under § 3173.23, if any of the proposed FMPs are outside the boundaries of any of the leases, units, or CAs from which production would be commingled (which may be included in the same Sundry Notice as the request for approval of commingling and allocation), except as provided in paragraph (a) of this section;
(c) A proposed allocation agreement, including an allocation methodology (including allocation of produced water), with an example of how the methodology is applied, signed by each operator of each of the leases, unit PAs, or CAs from which production would be included in the CAA;
(d) A list of all Federal or Indian lease, unit PA, or CA numbers in the proposed CAA, specifying the type of production ( i.e., oil, gas, or both) for which commingling is requested;
(e) A topographic map or maps of appropriate scale showing the following:
(1) The boundaries of all the leases, units, unit PAs, or communitized areas whose production is proposed to be commingled; and
(2) The location of existing or planned facilities and the relative location of all wellheads (including the API number) and piping included in the CAA, and existing FMPs or FMPs proposed to be installed to the extent known or anticipated;
(f) A surface use plan of operations (which may be included in the same Sundry Notice as the request for approval of commingling and allocation) if new surface disturbance is proposed for the FMP and its associated facilities are located on BLM-managed land within the boundaries of the lease, units, and communitized areas from which production would be commingled;
(g) A right-of-way grant application (Standard Form 299), filed under 43 CFR part 2880, if the proposed FMP is on a pipeline, or under 43 CFR part 2800, if the proposed FMP is a meter or storage tank. This requirement applies only when new surface disturbance is proposed for the FMP, and its associated facilities are located on BLM-managed land outside any of the leases, units, or communitized areas whose production would be commingled;
(h) Written approval from the appropriate surface-management agency, if new surface disturbance is proposed for the FMP and its associated facilities are located on Federal land managed by an agency other than the BLM;
(i) A right-of-way grant application for the proposed FMP, filed under 25 CFR part 169, with the appropriate BIA office, if any of the proposed surface facilities are on Indian land outside the lease, unit, or communitized area from which the production would be commingled;
(j) Documentation demonstrating that each of the leases, unit PAs, or CAs proposed for inclusion in the CAA is producing in paying quantities (or, in the case of Federal leases, is capable of production in paying quantities) pending approval of the CAA; and
(k) All gas analyses, including Btu content (if the CAA request includes gas) and all oil gravities (if the CAA request includes oil) for previous periods of production from the leases, units, unit PAs, or communitized areas proposed for inclusion in the CAA, up to 6 years before the date of the application for approval of the CAA. Gas analysis and oil gravity data is not needed if the CAA falls under § 3173.14(a)(1).
§ 3173.16   Existing commingling and allocation approvals.
Upon receipt of an operator's request for assignment of an FMP number to a facility associated with a CAA existing on January 17, 2017, the AO will review the existing CAA and take the following action:
(a) The AO will grandfather the existing CAA and associated off-lease measurement, where applicable, if the existing CAA meets one of the following conditions:
(1) The existing CAA involves downhole commingling that includes Federal or Indian leases, unit PAs, or CAs; or
(2) The existing CAA is for surface commingling and the average production rate over the previous 12 months for each Federal or Indian lease, unit PA, and CA included in the CAA is:
(i) Less than 1,000 Mcf per month for gas; or
(ii) Less than 100 bbl per month for oil.
(b) If the existing CAA does not meet the conditions of paragraphs (a)(1) or (a)(2) of this section, the AO will review the CAA for consistency with the minimum standards and requirements for a CAA under § 3173.14.
(1) The AO will notify the operator in writing of any inconsistencies or deficiencies with an existing CAA. The operator must correct any inconsistencies or deficiencies that the AO identifies, provide the additional information that the AO has requested, or request an extension of time from the AO, within 20 business days after receipt of the AO's notice. When the AO is satisfied that the operator has corrected any inconsistencies or deficiencies, the AO will terminate the existing CAA and grant a new CAA based on the operator's corrections.
(2) The AO may terminate the existing CAA and grant a new CAA with new or amended COAs to make the approval consistent with the requirements under § 3173.14 in connection with approving the requested FMP. If the operator appeals any COAs of the new CAA, the existing CAA approval will continue in effect during the pendency of the appeal.
(3) If the existing CAA does not meet the standards and requirements of § 3173.14 and the operator does not correct the deficiencies, the AO may terminate the existing CAA under § 3173.20 and deny the request for an FMP number for the facility associated with the existing CAA.
(c) If the AO grants a new CAA to replace an existing CAA under paragraph (b) of this section, the new CAA is effective on the first day of the month following its approval. Any new allocation percentages resulting from the new CAA will apply from the effective date of the CAA forward.
§ 3173.17   Relationship of a commingling and allocation approval to royalty-free use of production.
A CAA does not constitute approval of off-lease royalty-free use of production as fuel in facilities located at an FMP approved under the CAA.
§ 3173.18   Modification of a commingling and allocation approval.
(a) A CAA must be modified when there is:
(1) A modification to the allocation agreement;
(2) Inclusion of additional leases, unit PAs, or CAs are proposed in the CAA; or
(3) Termination of or permanent production cessation from any of the leases, unit PAs, or CAs within the CAA.
(b) To request a modification of a CAA, all operators must submit to the AO:
(1) A completed Sundry Notice describing the modification requested;
(2) A new allocation methodology, including an allocation methodology which includes allocation of produced water and an example of how the methodology is applied, if appropriate; and
(3) Certification by each operator in the CAA that it agrees to the CAA modification.
(c) A change in operator does not trigger the need to modify a CAA.
§ 3173.19   Effective date of a commingling and allocation approval.
(a) If the BLM approves a CAA, the effective date of the CAA is the first day of the month following first production through the FMPs for the CAA.
(b) If the BLM approves a modification, the effective date is the first day of the month following approval of the modification.
(c) A CAA does not modify any of the terms of the leases, units, or CAs covered by the CAA.
§ 3173.20   Terminating a commingling and allocation approval.
(a) The AO may terminate a CAA for any reason, including, but not limited to, the following:
(1) Changes in technology, regulation, or BLM policy;
(2) Operator non-compliance with the terms or COAs of the CAA or this subpart; or
(3) The AO determines that a lease, unit, or CA subject to the CAA has terminated, or a unit PA subject to the CAA has ceased production.
(b) If only one lease, unit PA, or CA remains subject to the CAA, the CAA terminates automatically.
(c) An operator may terminate its participation in a CAA by submitting a Sundry Notice to the BLM. The Sundry Notice must identify the FMP(s) for the lease(s), unit PA(s), or CA(s) previously subject to the CAA. Termination by one operator does not mean the CAA terminates as to all other participating operators, so long as one of the other provisions of this subpart is met and the remaining operators submit a Sundry Notice requesting a new CAA as outlined in paragraph (e) of this section.
(d) The AO will notify in writing all operators who are a party to the CAA of the effective date of the termination and any inconsistencies or deficiencies with their CAA approval that serve as the reason(s) for termination. The operator must correct any inconsistencies or deficiencies that the AO identifies, provide the additional information that the AO has requested, or request an extension of time from the AO, within 20 business days after receipt of the BLM's notice, or the CAA is terminated.
(e) If a CAA is terminated, each lease, unit PA, or CA that was included in the CAA may require a new FMP number(s) or a new CAA. Operators will have 30 days to apply for a new FMP number (§ 3173.12) or CAA (§ 3173.15), if applicable. The existing FMP number may be used for production reporting until a new FMP number is assigned or CAA is approved.
§ 3173.21   Combining production downhole in certain circumstances.
(a)(1) Combining production from a single well drilled into different hydrocarbon pools or geologic formations ( e.g., a directional well) underlying separate adjacent properties (whether Federal, Indian, State, or private), where none of the hydrocarbon pools or geologic formations underlie or are common to more than one of the respective properties, constitutes commingling for purposes of §§ 3173.14 through 3173.20.
(2) If any of the hydrocarbon pools or geologic formations underlie or are common to more than one of the properties, the operator must establish a unit PA (see 43 CFR part 3180) or CA (see 43 CFR 3105.2-1-3105.2-3), as applicable, rather than applying for a CAA.
(b) Combining production downhole from different geologic formations on the same lease, unit PA, or CA in a single well requires approval of the AO (see 43 CFR 3162.3-2), but it is not considered commingling for production accounting purposes.
§ 3173.22   Requirements for off-lease measurement.
The BLM will consider granting a request for off-lease measurement if the request:
(a) Involves only production from a single lease, unit PA, CA, or CAA;
(b) Provides for accurate production accountability;
(c) Is in the public interest (considering factors such as BMPs, topographic and environmental conditions that make on-lease measurement physically impractical, and maximum ultimate economic recovery); and
(d) Occurs at an approved FMP. A request for approval of an FMP (see § 3173.12) may be filed concurrently with the request for off-lease measurement.
§ 3173.23   Applying for off-lease measurement.
To apply for approval of off-lease measurement, the operator must submit the following to the BLM office having jurisdiction over the leases, units, or communitized areas:
(a) A completed Sundry Notice;
(b) Justification for off-lease measurement (considering factors such as BMPs, topographic and environmental issues, and maximum ultimate economic recovery);
(c) A topographic map or maps of appropriate scale showing the following:
(1) The boundary of the lease, unit, unit PA, or communitized area from which the production originates; and
(2) The location of existing or planned facilities and the relative location of all wellheads (including the API number for each well) and piping included in the off-lease measurement proposal, and existing FMPs or FMPs proposed to be installed to the extent known or anticipated;
(d) The surface ownership of all land on which equipment is, or is proposed to be, located;
(e) If any of the proposed off-lease measurement facilities are located on non-federally owned surface, a written concurrence signed by the owner(s) of the surface and the owner(s) of the measurement facilities, including each owner's name, address, and telephone number, granting the BLM unrestricted access to the off-lease measurement facility and the surface on which it is located, for the purpose of inspecting any production, measurement, water handling, or transportation equipment located on the non-Federal surface up to and including the FMP, and for otherwise verifying production accountability. If the ownership of the non-Federal surface or of the measurement facility changes, the operator must obtain and provide to the AO the written concurrence required under this paragraph from the new owner(s) within 30 days of the change in ownership;
(f) A right-of-way grant application (Standard Form 299), filed under 43 CFR part 2880, if the proposed off-lease FMP is on a pipeline, or under 43 CFR part 2800, if the proposed off-lease FMP is a meter or storage tank. This requirement applies only when new surface disturbance is proposed for the FMP and its associated facilities are located on BLM-managed land;
(g) A right-of-way grant application, filed under 25 CFR part 169 with the appropriate BIA office, if any of the proposed surface facilities are on Indian land outside the lease, unit, or communitized area from which the production originated;
(h) Written approval from the appropriate surface-management agency, if new surface disturbance is proposed for the FMP and its associated facilities are located on Federal land managed by an agency other than the BLM;
(i) An application for approval of off-lease royalty-free use (if required under applicable rules), if the operator proposes to use production from the lease, unit, or CA as fuel at the off-lease measurement facility without payment of royalty;
(j) A statement that indicates whether the proposal includes all, or only a portion of, the production from the lease, unit, or CA. (For example, gas, but not oil, could be proposed for off-lease measurement.) If the proposal includes only a portion of the production, identify the FMP(s) where the remainder of the production from the lease, unit, or CA is measured or is proposed to be measured; and
(k) If the operator is applying for an amendment of an existing approval of off-lease measurement, the operator must submit a completed Sundry Notice required under paragraph (a) of this section, and information required under paragraphs (b) through (j) of this section to the extent the information previously submitted has changed.
§ 3173.24   Effective date of an off-lease measurement approval.
If the BLM approves off-lease measurement, the approval is effective on the date that the approval is issued, unless the approval specifies a different effective date.
§ 3173.25   Existing approved off-lease measurement.
(a) Upon receipt of an operator's request for assignment of an FMP number to a facility associated with an off-lease measurement approval existing on January 17, 2017, the AO will review the existing approved off-lease measurement for consistency with the minimum standards and requirements for an off-lease measurement approval under § 3173.22. The AO will notify the operator in writing of any inconsistencies or deficiencies.
(b) The operator must correct any inconsistencies or deficiencies that the AO identifies, provide any additional information the AO requests, or request an extension of time from the AO, within 20 business days after receipt of the AO's notice. The extension request must explain the factors that will prevent the operator from complying within 20 days and provide a timeframe under which the operator can comply.
(c) The AO may terminate the existing off-lease measurement approval and grant a new off-lease measurement approval with new or amended COAs to make the approval consistent with the requirements for off-lease measurement under § 3173.22 in connection with approving the requested FMP. If the operator appeals the new off-lease measurement approval, the existing off-lease measurement approval will continue in effect during the pendency of the appeal.
(d) If the existing off-lease measurement approval does not meet the standards and requirements of § 3173.22 and the operator does not correct the deficiencies, the AO may terminate the existing off-lease measurement approval under § 3173.27 and deny the request for an FMP number for the facility associated with the existing off-lease measurement approval.
(e) If the existing off-lease measurement approval under this section is consistent with the requirements under § 3173.22, then that existing off-lease measurement is grandfathered and will be part of its FMP approval.
(f) If the BLM grants a new off-lease measurement approval to replace an existing off-lease measurement approval, the new approval is effective on the first day of the month following its approval.
§ 3173.26   Relationship of off-lease measurement approval to royalty-free use of production.
Approval of off-lease measurement does not constitute approval of off-lease royalty-free use of production as fuel in facilities located at an FMP approved under the off-lease measurement approval.
§ 3173.27   Termination of off-lease measurement approval.
(a) The BLM may terminate off-lease measurement approval for any reason, including, but not limited to, the following:
(1) Changes in technology, regulation, or BLM policy; or
(2) Operator non-compliance with the terms or conditions of approval of the off-lease measurement approval or §§ 3173.22 through 3173.26.
(b) The BLM will notify the operator in writing of the effective date of the termination and any inconsistencies or deficiencies with its off-lease measurement approval that serve as the reason(s) for termination. The operator must correct any inconsistencies or deficiencies that the BLM identifies, provide any additional information the AO requests, or request an extension of time from the AO within 20 business days after receipt of the BLM's notice, or the off lease measurement approval terminates on the effective date.
(c) The operator may terminate the off-lease measurement by submitting a Sundry Notice to the BLM. The Sundry Notice must identify the new FMP(s) for the lease(s), unit(s), or CA(s) previously subject to the off-lease measurement approval.
(d) If off-lease measurement is terminated, each lease, unit PA, or CA that was subject to the off-lease measurement approval may require a new FMP number(s) or a new off-lease measurement approval. Operators will have 30 days to apply for a new FMP number or off-lease measurement approval, whichever is applicable. The existing FMP number may be used for production reporting until a new FMP number is assigned or off-lease measurement is approved.
§ 3173.28   Instances not constituting off-lease measurement, for which no approval is required.
(a) If the approved FMP is located on the well pad of a directionally or horizontally drilled well that produces oil and gas from a lease, unit, or communitized area on which the well pad is not located, measurement at the FMP does not constitute off-lease measurement. However, if the FMP is located off of the well pad, regardless of distance, measurement at the FMP constitutes off-lease measurement, and BLM approval is required under §§ 3173.22 through 3173.26.
(b) If a lease, unit, or CA consists of more than one separate tract whose boundaries are not contiguous ( e.g., a single lease comprises two or more separate tracts), measurement of production at an FMP located on one of the tracts is not considered to be off-lease measurement if:
(1) The production is moved from one tract within the same lease, unit, or communitized area to another area of the lease, unit, or communitized area on which the FMP is located; and
(2) Production is not diverted during the movement between the tracts before the FMP, except for production used royalty free.
§ 3173.29   Immediate assessments for certain violations.
Certain instances of noncompliance warrant the imposition of immediate assessments upon discovery, as prescribed in the following table. Imposition of these assessments does not preclude other appropriate enforcement actions:
Table 1 to § 3173.29—Violations Subject to an Immediate Assessment
§ 3174.1   Definitions and acronyms.
(a) As used in this subpart, the term:
Barrel (bbl) means 42 standard United States gallons.
Base pressure means 14.696 pounds per square inch, absolute (psia).
Base temperature means 60 °F.
Certificate of calibration means a document stating the base prover volume and other physical data required for the calibration of flow meters.
Composite meter factor means a meter factor corrected from normal operating pressure to base pressure. The composite meter factor is determined by proving operations where the pressure is considered constant during the measurement period between provings.
Configuration log means the list of constant flow parameters, calculation methods, alarm set points, and other values that are programmed into the flow computer in a CMS.
Coriolis meter means a device which by means of the interaction between a flowing fluid and oscillation of tube(s) infers a mass flow rate. The meter also infers the density by measuring the natural frequency of the oscillating tubes. The Coriolis meter consists of sensors and a transmitter, which convert the output from the sensors to signals representing volume and density.
Coriolis measurement system (CMS) means a metering system using a Coriolis meter in conjunction with a tertiary device, pressure transducer, and temperature transducer in order to derive and report gross standard oil volume. A CMS system provides real-time, on-line measurement of oil.
Displacement prover means a prover consisting of a pipe or pipes with known capacities, a displacement device, and detector switches, which sense when the displacement device has reached the beginning and ending points of the calibrated section of pipe. Displacement provers can be portable or fixed.
Dynamic meter factor means a kinetic meter factor derived by linear interpolation or polynomial fit, used for conditions where a series of meter factors have been determined over a range of normal operating conditions.
Event log means an electronic record of all exceptions and changes to the flow parameters contained within the configuration log that occur and have an impact on a quantity transaction record.
Gross standard volume means a volume of oil corrected to base pressure and temperature.
Indicated volume means the uncorrected volume indicated by the meter in a lease automatic custody transfer system or the Coriolis meter in a CMS. For a positive displacement meter, the indicated volume is represented by the non-resettable totalizer on the meter head. For Coriolis meters, the indicated volume is the uncorrected (without the meter factor) mass of liquid divided by the density.
Innage gauging means the level of a liquid in a tank measured from the datum plate or tank bottom to the surface of the liquid.
Lease automatic custody transfer (LACT) system means a system of components designed to provide for the unattended custody transfer of oil produced from a lease(s), unit PA(s), or CA(s) to the transporting carrier while providing a proper and accurate means for determining the net standard volume and quality, and fail-safe and tamper-proof operations.
Master meter prover means a positive displacement meter or Coriolis meter that is selected, maintained, and operated to serve as the reference device for the proving of another meter. A comparison of the master meter to the Facility Measurement Point (FMP) line meter output is the basis of the master-meter method.
Meter factor means a ratio obtained by dividing the measured volume of liquid that passed through a prover or master meter during the proving by the measured volume of liquid that passed through the line meter during the proving, corrected to base pressure and temperature.
Net standard volume means the gross standard volume corrected for quantities of non-merchantable substances such as sediment and water.
Outage gauging means the distance from the surface of the liquid in a tank to the reference gauge point of the tank.
Positive displacement meter means a meter that registers the volume passing through the meter using a system which constantly and mechanically isolates the flowing liquid into segments of known volume.
Quantity transaction record (QTR) means a report generated by CMS equipment that summarizes the daily and hourly gross standard volume calculated by the flow computer and the average or totals of the dynamic data that is used in the calculation of gross standard volume.
Tertiary device means, for a CMS, the flow computer and associated memory, calculation, and display functions.
Transducer means an electronic device that converts a physical property, such as pressure, temperature, or electrical resistance, into an electrical output signal that varies proportionally with the magnitude of the physical property. Typical output signals are in the form of electrical potential (volts), current (milliamps), or digital pressure or temperature readings. The term transducer includes devices commonly referred to as transmitters.
Vapor tight means capable of holding pressure differential only slightly higher than that of installed pressure-relieving or vapor recovery devices.
(b) As used in this subpart, the following acronyms carry the meaning prescribed:
API means American Petroleum Institute.
CA has the meaning set forth in § 3170.3 of this part.
COA has the meaning set forth in § 3170.3 of this part.
CPL means correction for the effect of pressure on a liquid.
CTL means correction for the effect of temperature on a liquid.
NIST means National Institute of Standards and Technology.
PA has the meaning set forth in § 3170.3 of this part.
PMT means Production Measurement Team.
PSIA means pounds per square inch, absolute.
S&W means sediment and water.
§ 3174.2   General requirements.
(a) Oil may be stored only in tanks that meet the requirements of § 3174.5(b) of this subpart.
(b) Oil must be measured on the lease, unit PA, or CA, unless approval for off-lease measurement is obtained under §§ 3173.22 and 3173.23 of this part.
(c) Oil produced from a lease, unit PA, or CA may not be commingled with production from other leases, unit PAs, or CAs or non-Federal properties before the point of royalty measurement, unless prior approval is obtained under §§ 3173.14 and 3173.15 of this part.
(d) An operator must obtain a BLM-approved FMP number under §§ 3173.12 and 3173.13 of this part for each oil measurement facility where the measurement affects the calculation of the volume or quality of production on which royalty is owed ( i.e., oil tank used for tank gauging, LACT system, CMS, or other approved metering device), except as provided in paragraph (h) of this section.
(e) Except as provided in paragraph (h) of this section, all equipment used to measure the volume of oil for royalty purposes installed after January 17, 2017 must comply with the requirements of this subpart.
(f) Except as provided in paragraph (h) of this section, measuring procedures and equipment used to measure oil for royalty purposes, that is in use on January 17, 2017, must comply with the requirements of this subpart on or before the date the operator is required to apply for an FMP number under 3173.12(e) of this part. Prior to that date, measuring procedures and equipment used to measure oil for royalty purposes, that is in use on January 17, 2017 must continue to comply with the requirements of Onshore Oil and Gas Order No. 4, Measurement of oil, § 3164.1(b) as contained in 43 CFR part 3160, (revised October 1, 2016), and any COAs and written orders applicable to that equipment.
(g) The requirement to follow the approved equipment lists identified in §§ 3174.6(b)(5)(ii)(A), 3174.6(b)(5)(iii), 3174.8(a)(1), and 3174.9(a) does not apply until January 17, 2019. The operator or manufacturer must obtain approval of a particular make, model, and size by submitting the test data used to develop performance specifications to the PMT to review.
(h) Meters used for allocation under a commingling and allocation approval under § 3173.14 are not required to meet the requirements of this subpart.