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NTL-ADO 93-1

Notice to Lessees and Operators of Onshore Federal and Indian
Oil and Gas Leases Within the Jurisdiction
of the Albuquerque District Office
(NTL-ADO 93-1 New Mexico)

Requirements for Operators Who Vent or Flare Gas from Gas Wells

I. Background

Pursuant to Section III.B. of NTL-4A, gas venting or flaring is allowed (automatic approval) for unloading or clean-up of a well during routine purging and drillstem or evaluation tests without incurring a royalty obligation. However, gas vented in excess, i.e., continuing to vent after a well is unloaded, may be considered an avoidable loss and subject to royalty. Some wells are purged manually and others use automatic devices. Regardless of the method used, BLM has witnessed gas being vented long after a well has unloaded. In the San Juan Basin there are more than 14,000 gas wells on Federal and Indian leases and it is estimated that at least one third require routine purge cycles. The potential for waste is significant.

BLM and operators share the responsibility to prevent waste and conserve natural resources. Gas vented during routine purging or unloading is seldom measured. The volumes vented, when reported, are usually estimated. Therefore, neither the operator nor the BLM can accurately account for how much gas is vented or if it is wasted during purging.

II. Purpose

Current regulations require that all produced gas be measured by orifice meter or other acceptable methods. Gas lost without measurement must be determined by methods accepted by the Authorized Officer (AO). The purpose of this NTL is to establish the requirements for documenting acceptable methods used for determining gas volumes vented during purging and reporting requirements of these volumes. This NTL represents an effort to conserve resources, prevent waste, and extend the economic life of oil and gas wells and account for gas production from Federal and Indian oil and gas wells.

III. Authority

Title 43 CFR Part 3161.2, Responsibilities of the Authorized Officer, Title 43 CFR Part 3162.7-1(d), Disposition of Production, Title 43 CFR 3162.7-3, Measurement of Gas, and Onshore Oil and Gas Order No. 5, Measurement of Gas.

IV. Definitions

Gas Well - A well in which the BTU of the produced gas and its entrained liquid hydrocarbons exceeds that of the produced oil.

Routine Purging - Venting of gas (to atmosphere or tank) necessary to unload accumulated wellbore fluids (water, oil, condensate) which prevent the well from flowing.

V. Requirements

All operators who purge gas wells will be required to periodically review the purging program for each well. As a minimum, an annual review will be required unless the Authorized Officer determines that operational conditions dictate more frequent reviews. This review will document purge frequency and duration and provide a basis for determining the volumes vented. The volumes reported on MMS Form 3160, Disposition of Production section, shall accurately reflect the volumes of gas vented monthly. Review documentation and calculations for monthly vented well volumes will be retained by the lessee or his agent for a period of 6 years (per 43 CFR 3162.7-1(f)) and will be provided to the Authorized Officer upon request.

Wells that are purged with automated devices shall have the timers or pressure control valves set so that the purge cycle (venting to atmosphere) is limited to the time that is actually required to unload the well with no excess venting. Wells that are manually purged shall be blown down no longer than is necessary to unload the liquid from the well and the company representative must remain on location until the purge is completed.

APPROVED:Date: 11-25-92Robert Dale
Albuquerque District Manager