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November 26, 2008
In Reply Refer To:
3160 (310) P
Instruction Memorandum No. 2009-027
Expires: 9/30/2010
To:                   All Field Officials
From:               Assistant Director, Minerals and Realty Management
Subject:           TheFeasibility Use of Truck Mounted Meters for Oil Measurement Onshore
                                                                                                                        DD: 12/28/08
Program Area: Oil and Gas Management
Purpose: Determine the feasibility of truck mounted meters, such as coriolis meters, for oil measurement on Federal Leases in lieu of tank gauging. 

Policy/Action: At least one field office is using truck mounted meters to measure oil in lieu of tank gauging during sales. The meters being used on the trucks are not positive displacement meters and, therefore, require an exception to Onshore Oil and Gas Order #4 (OO#4). In order to identify the extent of use of truck mounted meters for oil measurement, the following table needs to be completed by all field officers where oil is being produced and returned to the Washington WO 310 Washington Office (WO). Please list all the different meter types being used on trucks on separate lines.

Field Office Name:
Make and Model of meter
Number of facilities from which oil is loaded
Range of size of pipes at loading point
Accuracy Specifications
Approximate cost
Overall impression of use of meters vs. tank gauges:





The use of truck mounted meters for measuring oil from tanks in lieu of tank gauging is a Best Management Practice (BMP) for oil measurement. However, before any meter other than described in OO #4 can be used, it must first be proven to be at least as accurate as the standards set in OO #4. Evaluation of these different meters will be performed by the Gas and Oil Measurement Team (GOMT). The GOMT will evaluate meters whenever a company requests that its meter be allowed to be used for oil measurement or if a field office indentifies a meter to be evaluated. The GOMT will develop a method to evaluate meters to ensure that they meet or exceed the standards set in OO #4. Once the GOMT has approved of a meter, the WO will issue an Instructional Memorandum (IM) outlining under what conditions the meter can be used. 

In the North Dakota Field Office, the use of a truck mounted coriolis meter system instead of tank gauging is presently in use. Attachment 1 is a short paper from the North Dakota Field Office on the use of this truck mounted meter. This system will be the first to be evaluated to ensure that government interests are being properly accounted.
Field offices are encouraged to identify additional truck mounted meters for oil measurement that should be evaluated. Depending on the number of requests received, the GOMT will evaluate each meter in a reasonable amount of time. Time for each evaluation will depend upon how quickly independent tests of the meter can be performed and the number of requests received.
Timeframe: The table is required to be completed and returned to WO-310 by
December 28, 2008.
Budget Impact: There is no budget impact.
Background: Over the last several years, there have been a number of reviews and audits by the Inspector General, Government Accountability Office, and others of both onshore and offshore oil and gas operations and production accountability. The Bureau of Land Management (BLM) is depending, to a large part, on the truckers to accurately gauge tanks on Federal leases for custody of oil to the United States. The Secretary’s subcommittee report dated December 17, 2007, “Mineral Revenue Collection from Federal and Indian Lands and the Outer Continental Shelf,” raised a number of concerns with the BLM’s Production Accountability Program, focusing on oil and gas measurement and particularly in the measurement of oil using tank gauging procedures. 
While tank gauging is a tried and true form of measurement, the BLM is interested in moving oil measurement towards automation. For example, for onshore operations on Federal lands, there are only 1500 Lease Accounting Custody Transfer (LACT) meters, and approximately 55,000 tanks to be gauged. Our goal over the next several years is to shift measurement practices whereby most of the production is measured by meters that meet the standards of the American Petroleum Institute. 
Manual/Handbook Sections Affected:  This IM will not directly affect any manual or handbook, but may require changes in OO #4. 
Coordination: This memorandum was coordinated between the WO and the GOMT.  
Contact: Any questions regarding this IM should be referred to Tim Spisak at (202) 452-5061 or William Gewecke at (202) 452-0337, or william_gewecke@blm.gov. 
Signed by:                                                                Authenticated by:
Michael D. Nedd                                                        Robert M. Williams
Assistant Director                                                     Division of IRM Governance,WO-560
Minerals and Realty Management
1  Attachment

Last updated: 10-20-2009