IN THE UNITED STATES BANKRUPTCY COURT

In re: )

FOR THE DISTRICT OF DELAWARE

Chapter 1 1
1

PACIFIC ENERGY RESOURCES LTD., et al., )

Debtors. )

Case No. 09-10785(KJC) (Jointly Administered)

Objections due by: June 9, 2009 at 4:00 p.m. prevailng Eastern time Hearing Date: July 1,2009 at 10:00 a.m. prevailng Eastern time

DEBTORS' APPLICATION FOR ENTRY OF AN ORDER PURSUANT TO SECTION 327(A) OF THE BANKRUPTCY CODE AND FED. R. BANKR. P. 2014 AUTHORIZING THE EMPLOYMENT AND RETENTION OF AMS-P AR AS SPECIAL JOINT INTEREST BILLING AUDITORS TO THE DEBTORS AND DEBTORS-IN-POSSESSION
The above-captioned debtors and debtors-in-possession (collectively, the
"Debtors"), submit this application for an order pursuant to section 327(a) of

the Bankuptcy

Code and Fed. R. Bankr. P. 2014 authorizing the employment and retention of AMS-PAR

("AMS") as special joint interest biling auditors to the Debtors as more fully set forth below
pursuant to the terms of the Engagement Letter (defined below) and the Affdavit of

David

Johnson, a principal of AMS (the "Johnson Affidavit"), a copy of which is attached hereto as

Exhibit A. In support of this application, the Debtors respectfully state as follows:

The Debtors in these cases, along with the last four digits of each of the Debtors' federal tax identification number, are: Pacific Energy Resources Ltd. (3442); Petrocal Acquisition Corp. (6249); Pacific Energy Alaska Holdings, LLC (tax I.D. # not available); Cameros Acquisition Corp. (5866); Pacific Energy Alaska Operating LLC (7021); San Pedro Bay Pipeline Company (1234); Cameros Energy, Inc. (9487); and Gotland Oil, Inc. (5463). The
mailing address for all of

the Debtors is 111 W. Ocean Boulevard, Suite 1240, Long Beach, CA 90802.

OOOOI-OOIIDOCS_DE: 147421.3

Jurisdiction
1. This Court has jurisdiction over this application under 28 U.S.C. 157

and 1334. This matter is a core proceeding within the meaning of28 U.S.c. 157(b)(2). Venue
of

these proceedings and this application in this district is proper under 28 US.C. 1408 and

1409.
2. The statutory basis for the relief requested herein is section 327(a) of

title

11 ofthe United States Code, as amended by the Bankptcy Abuse Prevention and Consumer

Protection Act of 2005 (the "Bankptcy Code").

Background
3. On March 9, 2009 (the "Petition Date"), the Debtors each fied voluntary
petitions for relief under chapter 1 1 of the Banptcy Code. The Debtors are continuing in

possession of their property and are operating and managing their businesses, as debtors in
possession, pursuant to sections 1 107 and 1 108 of the Bankruptcy Code.
4. No request for the appointment of a trustee or examiner has been made.

The Official Committee of

Unsecured Creditors (the "Committee") was appointed by the United

States Trustee on March 19, 2009.

5. The factual background relating to the Debtors' commencement of

these

chapter 1 1 cases are set forth in detail in the Declaration of Gerald a. Tywoniuk, Chief Financial

Offcer, in support of First Day Motions fied on March 9, 2009 (Docket No.2).
Relief ReQuested
6. The Debtors desire to retain and employ AMS as joint interest biling

auditors pursuant to section 327(a) of

the Banptcy Code to perform certain

joint interest

2
0000 1-00 1\DOCS_DE: 147421.3

biling audit services as described herein and consistent with the terms and conditions of the May
1,2009, engagement letter between the parties (the "Engagement Letter") attached hereto as
Exhibit B.

The Need for Audit Services

7. PEAO and an affliate of

Chevron Corporation ("Chevron") each own a

working interest in two offshore properties commonly referred to as the Trading Bay Field and

the Trading Bay Unit in Cook Inlet, Alaska ("collectively, referred to as the "Trading Bay

Properties"). Trading Bay Field consists of 5,840 developed acres with one offshore platform
and twenty-five producing wells. Trading Bay Unit consists of 16,179 developed acres with four offshore platforms and sixty-six producing wells. PEAO and Chevron have a 46.8% working
interest and a 53.2% working interest, respectively, in each of

the Trading Bay Properties.

Chevron, as the majority owner, is the operator ofthe Trading Bay Properties.
8. As operator, Chevron allocates a portion of

the revenues and the costs of

production to PEAO based upon its working interest in the underlying assets. As of March 8,
2009, the estimated accrued and unpaid expenses (net of

production) assessed by Chevron

against PEAO on account of

its working interests totaled approximately $25.2 milion. Chevron

asserts a first priority lien in PEAO's working interests in the Trading Bay Properties and the
proceeds thereof

to secure PEAO's obligations to Chevron.

9. The Debtors dispute the amount of expenses incurred and allocated to

PEAO's assets by Chevron and believe that Chevron may have overcharged the Debtors milions
of dollars in operating expenses. Forest Oil Corporation, the former owner of

these same assets

3
0000 i -00 I\DOCS_DE: 1 47421.3

has already fied an action against Chevron asserting significant operating expenses overages.

AMS performed the audit for Forest Oil Corporation in relation to this action.
AMS's Qualifications
10. Because AMS has already performed an audit for Forest Oil Corporation

on these same assets, AMS is familiar with the assets as well as Chevron's operations and
bookkeeping.
1 1. In addition, AMS has significant qualifications and experience in
performing the scope of

work described below. Throughout the oil and gas industry, AMS-PAR

is recognized as a knowledgeable and trusted contributor to an in-depth understanding of such

critical components as joint venture operations, vendor contract compliance, royalty
distributions, and comprehensive accounts payable examinations. AMS' s services are backed by

state-of-the-art technology and a highly experienced consulting staff.

12. As a result, AMS has considerable knowledge about and familiarity with

the operations of the applicable assets. Such experience and knowledge wil be valuable to the
Debtors in their efforts to determine the validity of the claims asserted against the Debtors by

Chevron. Accordingly, the Debtors believe that AMS is well qualified and able to perform
auditing services for the Debtors in a cost-effective, efficient, and timely manner.
ScoDe of Services
13. The Debtors request authority to retain and employ AMS to perform an

audit of the operating expenses related to the operations of the Trading Bay Properties and

facilities located in Cook Inlet, Alaska. The scope of AMS' services are as follows:

4
00001-00J\DOCS E: 14742 i.3

a. Review lease operating expenses reflected on the joint interest bilings for the period January 2007 through December 2008 as appropriate;
b. Review and evaluate the invoices and other documentation

supporting the joint interest bilings for validity, accuracy and compliance with the joint operating agreement, accounting procedure and any associated amendments and/or additional agreements; and
c. Conduct Additional tests and analyses as specifically requested by

authorized personnel of PERL, including comparison of charges made to AFE' s to what was authorized to be expended.

AMS's Disinterestedness

14. AMS has informed the Debtors that, except as may be set forth in the
Johnson Affdavit, to the best of

its knowledge after reasonable inquiry it (a) has no connection

with the Debtors, their significant creditors or other parties-in-interest in these restructuring

cases, (b) does not hold any interest adverse to the Debtors' estates and (c) believes that it is a
disinterested person as defined in section 101(14) of

the Bankptcy Code.

15. AMS wil conduct an ongoing review of its fies to search for potential
conflicts or other disqualifying circumstances. If AMS discovers material facts or relationships that it determines require disclosure, AMS wil provide the Court with supplemental disclosure.

16. AMS has agreed not to share with any non-affliated person or firm any
compensation it wil receive for professional services it renders in connection with these chapter
11 cases.

Payment of Fees and EXDenses

17. The Debtors understand that AMS intends to apply to the Court for

allowance of compensation and reimbursement of expenses for its audit services performed for
the Debtors in accordance with the applicable provisions of

the Bankptcy Code, the Federal

5
OOOOI-OOI\DOCS_DE: 147421.3

Rules of

Banruptcy Procedure, corresponding local rules, the guidelines established by the U.S.

Trustee and orders of

this Court. The customar hourly rates, subject to periodic adjustments,

charged for AMS professionals anticipated to provide services to the Debtors pursuant to the
application, is $100.00 per hour per professionaL.
18. In addition to compensation for professional services rendered by AMS

personnel, AMS wil seek reimbursement for reasonable and necessary expenses incurred in
connection with these restructuring cases, including, without limitation, the costs of travel, long
distance telephone and telecommunication charges, photocopying, delivery, and postage.

19. AMS is not owed any amounts for prepetition services rendered to the
Debtors.
20. As set forth in the Engagement Letter, AMS anticipates that there wil be

four people working on the project and that the work wil take approximately 5 weeks. Because
of the limited nature of the employment, AMS requests that the Court approve the payment of its

invoices by the Debtors in the ordinary course of the Debtors business, with AMS fiing a first
and final fee application for the approval of all of its fees and expenses at the conclusion of its

work. AMS further requests that its final fee application be set for hearing on any available
omnibus hearing date and that it not have to wait until a hearing where the interim fee
applications of the other professionals employment in these cases are being heard. Notice
21. Notice ofthis Motion has been given to the following paries or, in lieu

thereof, to their counsel, ifknown: (i) the United States Trustee; (ii) counsel for the Official
Committee of

Unsecured Creditors (iii) the prepetition and postpetition secured lenders'

6

00001 -00 1 \DOCS E: 14742 1.3

respective counsel, and (iv) all paries in interest requesting notice under Bankptcy Rule 2002.
In light of the nature of the relief requested herein, the Debtors submit that no other or further
notice is required.

No Prior ReQuest
No prior application for the relief requested herein has been made to this or any other Court.
WHEREFORE, the Debtors request that this Court enter an Order (i) authorizing

the Debtors to retain and employ AMS as special joint interest bilings auditor pursuant to the
terms of

the Engagement Letter and this Application and (ii) granting the Debtors such other and

further relief as it deems just and proper.

Dated: May ~1, 2009

Laur Davis nes (DE ar . 2436)

Ira . Kharasc (CA ar No.1 9084)

Scotta E. McFarland E Bar 0.4184, CA Bar No.

165391)

Robert M. Saunders (CA Bar No. 226172)

James E. O'Neil (DE Bar No. 4042)

Kathleen P. Makowski (DE Bar No. 3648) 919 North Market Street, 1 ih Floor Wilmington, DE 19899-8705
Telephone: 302/652-4100

Facsimile: 310/652-4400
Email: Ijones(pszjlaw.com

ikharasch(pszj law.com smcfarland(pszj law.com

rsaunders(pszj law .com
j oneil

(pszj law .com

kmakowski(pszj law .com

Counsel for Debtor and Debtor in Possession, Pacific Energy Resources Ltd.

7
OOOOI-OOI\DOCS_DE: 147421.3

IN THE UNITED STATES BANKRUPTCY COURT

FOR THE DISTRICT OF DELAWARE

In re:

PACIFIC ENERGY RESOURCES LTD., et al., 1

Debtors.

) ) )
) )

Chapter i i
Case No. 09- i 0785(KJC)

(Jointly Administered)

Deadline for Objections: June 9, 2009 at 4:00 p.m. prevailng Eastern time Hearing Date: July 1,2009 at 10:00 a.m. prevailng Eastern time

NOTICE OF APPLICATION OF DEBTORS FOR ENTRY OF AN ORDER PURSUANT TO SECTION 327(A) OF THE BANKRUPTCY CODE AND FED. R. BANKR. P. 2014 AUTHORIZING THE EMPLOYMENT AND RETENTION OF AMS-P AR AS SPECIAL JOINT INTEREST BILLING AUDITORS TO THE DEBTORS AND DEBTORS IN POSSESSION
TO: (a) the Office of

Delaware; (b) counsel to the Unsecured Creditors (c) the Debtors' pre-petition and post-petition Official Committee of lenders or their counsel and (d) all parties who have requested notice pursuant to
the United States Trustee for the District of

Bankptcy Rule 2002

PLEASE TAKE NOTICE that on May 27,2009, the debtors and debtors-inpossession (collectively, the "Debtors") in the above-captioned case have filed the attached
Application of Debtors for Entry of an Order Pursuant to Section 327(a) of

the Bankruptcy Code

MS-PAR as Special

and Fed. R. Bankr. P. 2014 Authorizing the Employment and Retention of A

Joint Interest Biling Auditors to the Debtors and Debtors in Possession (the "Application") with
the Clerk of the United States Banruptcy Court for the District of

Delaware.

PLEASE TAKE FURTHER NOTICE that any response or objection the

Application must be filed on or before June 9, 2009 at 4:00 p.m. prevailng Eastern Time.

i The Debtors in these cases, along with the last four digits of each of

the Debtors' federal tax identification

number, are: Pacific Energy Resources Ltd. (3442); Petrocal Acquisition Corp. (6249); Pacific Energy Alaska

Holdings, LLC (tax I.D. # not available); Cameros Acquisition Corp. (5866); Pacific Energy Alaska Operating LLC (7021); San Pedro Bay Pipeline Company (1234); Cameros Energy, Inc. (9487); and Gotland Oil, Inc. (5463). The
mailing address for all of

the Debtors is 111 W. Ocean Boulevard, Suite 1240, Long Beach, CA 90802.

Objections or other responses to the Application, if any, must also be served so

that they are received not later than June 9, 2009 at 4:00 p.m. prevailng Eastern time, by: (1)
Pachulski Stang Ziehl & Jones LLP, 919 North Market Street, 1 ih Floor, Wilmington, DE

19899-8705, Attn: Laura Davis Jones, Esq.; Fax: 302-652-4400, e-mail: lionesrpszilaw.com
and (2) Pachulski Stang Ziehl & Jones LLP, 10100 Santa Monica Blvd., 11th Floor, Los

Angeles, CA 90067-4100; Attn: Ira D. Kharasch, Esq; Fax: 310-201-0760, e-mail:

ikharashrpszilaw.com (b) counsel to the Lenders: Goldman Sachs (1) Bingham McCutchen,

399 Park Avenue, New York, NY 10022, Attn: Jeffrey Sabin, Esq.; Fax: 212-752-5378, e-mail:
ieffrey.sabinrbingham.com and (2) Bingham McCutchen, One Federal Street, Boston, MA

01221-1726, Attn: Amy Kyle, Fax: 617-345-5001, e-mail: amy.kylerbingham.com and Silver
Point Finance: Skadden, Arps, Slate, Meagher & Flom, LLP, 333 West Wacker Drive, Chicago,

IL 60606-1285, Attn: Seth Jacobson, Esq.; Fax: 312-407-8511, e-mail:

seth.iacobsonrskadden.com and (c) the Office of

the United States Trustee, 1. Caleb Boggs

Federal Building, 844 N. King Street, Suite 2207, Lock Box 35, Wilmington, Delaware 19801,
Attn: Joseph McMahon, Esq. and (d) counsel for the Official Committee of

Unsecured Creditors

(the "Committee"), (1) Steptoe & Johnson LLP, 2121 Avenue of

the Stars, 28th Floor, Los

Angeles, CA 90067; Attn: Katherine C. Piper, Esq., Fax: (310) 734-3173, e-mail:

kpiperrsteptoe.com and (2) Pepper Hamilton LLP, Hercules Plaza, Ste 5100,1313 N. Market
Street, Wilmington, DE 19801; Attn: James C. Carignan, Esq., Fax: (302) 421-8390, e-mail:
i carignanrpepperlaw .com.

A HEARING ON THE APPLICATION WILL BE HELD BEFORE THE

HONORABLE KEVIN J. CAREY AT THE UNITED STATES BANKRUPTCY COURT,

824 MARKET STREET, FIFTH FLOOR, COURTROOM #5, WILMINGTON,

DELAWARE 19801 ON JULY 1,2009 AT 10:00 A.M. PREVAILING EASTERN TIME.
IF YOU FAIL TO RESPOND IN ACCORDANCE WITH THIS NOTICE, THE

COURT MAY APPROVE THE APPLICATION WITHOUT FURTHER NOTICE OR

HEARING.

Dated: May ;(i, 2009

PACHULSKI STANG ZIEHL & JONES LLP

Lau Davis ones (DE B 0.2436)

Ira D. Kharasch (CA B No. 109084)
Scotta E. McFarland ( No. 4184, CA Bar No. 165391)

Robert M. Saunders (CA Bar No. 226172)

James E. O'Neil (DE Bar No. 4042)

Kathleen P. Makowski (DE Bar No. 3648)

919 North Market Street, 17th Floor

P.O. Box 8705 Wilmington, DE 19899-8705

Telephone: 302/652-4100

Facsimile: 310/652-4400
Email: lionesrpszilaw.com

ikharaschrpszi law .com smcfarlandrpszi law .com rsaundersrpszi law .com

ioneillrpszilaw.com kmakowskirpszilaw.com
Counsel for Debtors and Debtors in Possession.

68773-002\DOCS_DE: 148594.1

EXHIBIT A

00001-00I\DOCS_DE: 147421.3

IN THE UNITED STATES BANKRUPTCY COURT

In re: )
STATE OF

FOR THE DISTRICT OF DELAWARE

Chapter 1 1
I

PACIFIC ENERGY RESOURCES LTD., et al., )

Case No. 09- 1 0785(KJC)

Debtors. )

(Jointly Administered)

AFFIDAVIT OF DAVID JOHNSON IN SUPPORT OF DEBTORS' APPLICATION FOR ENTRY OF AN ORDER PURSUANT TO SECTION 327(A) OF THE BANKRUPTCY CODE AND FED. R. BANKR. P. 2014 AUTHORIZING THE EMPLOYMENT AND RETENTION OF AMS-P AR AS JOINT INTEREST BILLING AUDITORS TO THE DEBTORS AND DEBTORS-IN-POSSESSION

TEXAS )
) ss

COUNTY OF HOUSTON )

I, David Johnson, being duly sworn according to law, upon his oath, deposes and says:

1. I am a principal in the firm of AMS-P AR ("AMS" or the "Firm"), which

has its principal office at 480 N. Sam Houston Parkway East, Suite 230, Houston, TX 77060. I
am authorized to execute this affidavit on behalf of AMS. Unless otherwise stated in this
affidavit, I have personal knowledge of

the facts set forth herein.

2. This affidavit is being submitted in connection with the proposed retention

of AMS as special joint interest billngs auditor to the above-captioned debtors and debtors in

The Debtors in these cases, along with the last four digits of each of the Debtors' federal tax identification number, are: Pacific Energy Resources Ltd. (3442); Petrocal Acquisition Corp. (6249); Pacific Energy Alaska Holdings, LLC (tax I.D. # not available); Cameros Acquisition Corp. (5866); Pacific Energy Alaska Operating LLC (7021); San Pedro Bay Pipeline Company (1234); Cameros Energy, Inc. (9487); and Gotland Oil, Inc. (5463). The
mailing address for all of

the Debtors is 1 I I W. Ocean Boulevard, Suite 1240, Long Beach, CA 90802.

00001-001\DOCS_ DE: 14742 1.3

possession. (the "Debtors") to perform services as set forth in the application seeking approval of
the retention of AMS (the "Application").

3. The curent managing directors, directors, vice presidents and associates

of AMS have over 25 years of experience in the oil and gas industry and has significant qualifications and experience in performing the scope of work described in the Engagement

Letter. Throughout the oil and gas industry, AMS is recognized as a knowledgeable and trusted
contributor to an in-depth understanding of such critical components as joint venture operations,

vendor contract compliance, royalty distributions, and comprehensive accounts payable

examinations. AMS's services are backed by state-of-the-art technology and a highly

experienced consulting staff.
4. In addition, in 2006, AMS assisted Forest Oil Corporation, the former

owner of

the Debtors assets located in Alaska, in performing a

joint interest biling audit for

Forest Oil Corporation on these same assets and such audit is the basis of a currently pending

lawsuit fied by Forest against Chevron. Therefore, AMS is familiar with the assets as well as
Chevron's operations and bookkeeping.
5. In connection with its proposed retention by the Debtors in these cases,

AMS undertook to determine whether it had any conflcts or other relationships that might cause
it not to be disinterested or to hold or represent an interest adverse to the Debtors. Specifically,
AMS obtained from the Debtors and/or their representatives the list of names of individuals and

entities that are parties-in-interest in these chapter 11 cases (the "Parties-in-Interest") that is

attached hereto as Schedule 1. AMS has researched its client fies and records to determine its
connections with these Paries-in-Interest. As set forth above, Forest Oil Corporation is the only
2
OOOOI-OOI\DOCS_DE: 147421.3

Potential Pary-in-Interest that AMS has performed services for in the last three years and such
work was on matters unelated to the Debtors and these cases. AMS has performed work in the

past for Chevron or certain of its subsidiaries, but has not performed any such work in the past three years and such work, when performed, was not related in any way to the Debtors or their
businesses. To the extent that AMS discovers it is engaged by, or enters into any new
engagement with, any of

the Parties-in-Interest, it wil supplement this disclosure to the Court

promptly.
6. In addition, due to the magnitude ofthe Debtors' potential universe of

creditors and the Firm's clients, the Firm may have in the past represented, currently represent,
and may in the future represent entities that are claimants of

the Debtors in matters entirely

unrelated to the Debtors and their estates. The Firm does not and wil not represent any such
entity in connection with these pending chapter 11 cases and does not have any relationship with
any such entity, attorneys or accountants that would be adverse to the Debtors or their estates.

Other than as disclosed herein, AMS has no relationship with the Debtors of which I am aware
after due inquiry.
7. To the best of

my knowledge, neither I, AMS, nor any parner or associate

thereof, insofar as I have been able to ascertain, has any connection with the the U.S. Trustee or
any person employed in the office of

the u.s. Trustee or any Bankruptcy Judge currently serving

on the United States Bankrptcy Court for the District of Delaware.

8. Based upon the foregoing, I believe AMS is disinterested as defined in

section 101 (14) of the Bankptcy Code and does not hold or represent an interest adverse to the
Debtors or their estates.
3
00001-00I\DOCS_DE'14742 1.3

9. Four employees of AMS wil perform the on-sight portion of

the joint

in:erest billing audit. AMS wil bil their time at the rate of$100 per hour. I expect that the
project wil be completed in approximately 975 hours (approximately 5 weeks).

10. AMS charges its clients for reasonably incured, out-of-pocket expenses
associated with an assignent. Except as necessary to comply with an applicable

admnistrative

order, all such expense billngs are in accordance with the Firm's customar practices.
11. It is the intention of AMS to seek compensation for its servces as

descrihed in the Application and the Engagement Letter in accordance with the Banptcy
Code, the Banruptcy Rules, the United States Trustees' Guidelines and any and all rules of

ths

Court.
I declare under the penalty of peijury that the forgoing is tre and correct to the

be'st of

my knowledge.
AMS-P AR

B~ fi
. Name: David J son
d subscribed to before me, a notay
the State of his &1 day of Texas, County

of

May, 2009

Notar Public

~uy=-~l JAIl2D1

4
OOOH1.001IDCS_DEi: 147421 ,)

EXHIBIT B

42 125-001\DOCS_DE:6375.

AM

"lAR

May 1, 2009

Pacific Energy Resources, Ltd Attn: Mr. Mickey Wiesinger

111 W. Ocean Blvd., Ste. 1240, Suite 1224

Long Beach, CA 90802

Dear Mr. Wiesinger,

Based on our conversation on Apri 14, 2009 and subsequent conversations, please accpt
the following as our agreement to conduct the following servces on behal of Pacifc Energy
Resources Ltd.("PERL"), in the conduct of a Joint Interest Audit of the 'Trading Bay Unit

and Facilty (TBUllBF) located in Cook Inlet Alaska operate~ by Chevion, Inc. Servces
wil include:

1. Review the Lease Operating Expenses reflectd on the Joint Interest Bilngs

for the period Januar 2007 through December 2008 as appropriate provided the Operator makes al data available.

2. Review and evaluate the invoices and other documentation supporting the
Joint Interest Bilgs for valdity, accuracy and compliance with the Joint

Operating Agreement, Accounting Procedure and any associated amendments and/or additional agreements.
3. Conduct additional tests and analyses as specicay requested by authoried

personnel of PERL, including a comparson of charges made to AFE's to what

was authorid to be expended.

4. The Engagement wil not include a review of capital expenditures, which may
be conductd at a later date as coordinated between PERL and Chevron.

The field work of this engagement wil be conducted by four staff representing the
consulting fi_ of AMS-P AR. Ken Douglass wil

lead the team.

We wil need PERL to provide the following information to faciltate our review:
1. Joint Interest Biling for the appropriate period to be reviewed.

2. Copies of al contracts and agreements relating to the noted propertes and

facilties.
3. Al statements for lease operations durng the review period.

4. Approved AFE's and all supplementa AFE approvals. 5. Al State Reports resulting from any other reportble activity durng the review

period provided by the Operator.

6. Specifc areas of concern.

AMS-PAR wil invoice for its servces at an hourly rate of $100.00. A maximum of 12 hours

travel time per staff for each round trip to California wi be charged to the project.
480 N. Sam HousUin Pkwy. E., Suite 230 Ho1lUin, TX 77060
281.866.8256 CORPORATE OFFCE

832.20t.8171 FAX

www.nmA-iinr.com

AMPAR

Engagement Letter Pacific Energy Resources

Based on information recently received, the total LOE chaged to the Joint Account for the
period August 2007 through December 2008 was approximately $96 milon. The Operator

has not provided information for the :fst seven months of 2007. Based on this new information, I estimate the work requested wil take approximately 975 hours to complete. This is signicantly less than the 36 man-weeks of field work that Forest Oil previously scheduled to complete the review. We wil scope our analysis appropriately. Chevrn has
agreed to provide space for four staff for up to four weeks of field work. Reasonable actual

travel cost wil be invoiced as incured and wil include aiare, hotel, meals, local
transportation and any necessary miscellaneous costs (including but not limited to parking,
document shipping, copying servce). Any cost in excess of the precedig wil requie the

prior approval of the Mr. Mickey Wiesinger of Pacifc Energy.

Estimated Costs are as follows:

Rate
Prep Time

90
12
1

Travel Tie
Travel Cost(1)

4 4 4

Field Work

Finalpt

40 40

2.25

$100.00 100.00 1,880.00 100.00 100.00 Total:

$ 9,000.00

19,200.00 30,180.00 64,000.00 18.000.00

140.380 00

Travel Cost 1

Amount
$900.00 175.00 60.00 400.00
2
$ 7,200.00

Aiare
Hotel Meals
Rent Car

23 23
4

16,100.00 3,680.00 3.200.00

5i 30.180.00

Total

Please sign and date below and provide me with a copy of this letter signed in original.
Sincerely,

AMS-PAR Pacifc Energy Resources, Ltd

Darid~~ ~t:n!i~
Date:

~ c.7 5 i 20 0 5-

Date: s-I S- !tJc:

AMS~AR

IN THE UNITED STATES BANKUPTCY COURT

In re: )
Upon the application (the "Application,,)2 of

FOR THE DISTRICT OF DELAWAR

Chapter 1 1
1

)
)

PACIFIC ENERGY RESOURCES LTD., et al., )

Debtors. )

Case No. 09-10785(KJC) (Jointly Administered) Related to Docket No.

ORDER AUTHORIZING THE EMPLOYMENT AND RETENTION OF AMS-P AR PURSUANT TO SECTION 327(A) OF THE BANKRUPTCY CODE AND FED. R. BANKR. P. 2014 AS JOINT INTEREST BILLING AUDITORS TO THE DEBTORS AN DEBTORS-IN-POSSESSION
the Debtors for an order, pursuant to

section 327(a) of

the Bankptcy Code and Fed.R.Bank.P. 2014(a), authorizing the employment

and retention of AMS-P AR ("AMS") as joint interest biling auditors to the Debtors, as more
fully set forth in the Application; and upon consideration of the Affdavit of

David Johnson, a

principal of AMS (the "Johnson Affdavit"), a copy of

which is attached to the Application as

Exhibit A; and the Court having jurisdiction to consider the Application and the relief requested
therein in accordance with 28 U.S.C. 157 and 1334; and due and proper notice of

the

Application having been given, and it appearing that no other or further notice need be provided;

and the Court having determined that (i) AMS holds no interest adverse to the Debtors or the

The Debtors in these cases, along with the last four digits of each of the Debtors' federal tax identification number, are: Pacific Energy Resources Ltd. (3442); Petrocal Acquisition Corp. (6249); Pacific Energy Alaska Holdings, LLC (tax I.D. # not available); Cameros Acquisition Corp. (5866); Pacific Energy Alaska Operating LLC (7021); San Pedro Bay Pipeline Company (1234); Cameros Energy, Inc. (9487); and Gotland Oil, Inc. (5463). The
mailing address for all of

the Debtors is 111 W. Ocean Boulevard, Suite 1240, Long Beach, CA 90802.

Capitalized terms not defined herein shall have the meaning ascribed to them in the Application.

00001 -001 IDOCS_ DE: 147421.3

Debtors' estates with respect to the matters upon which it is to be engaged, (ii) AMS is a
"disinterested person" as that term is defined under section 101(14) of

the Bankptcy Code, as

modified by section 1 107(b) of

the Bankptcy Code and that (iii) AMS's employment is

necessary and in the best interest of the Debtors' estates, their creditors and other parties-in-

interest; and after due deliberation and sufficient cause appearing therefore, it is hereby ORDERED that the Application is granted in its entirety; and it is further
ORDERED that the Debtors' employment and retention of AMS as joint interest
biling auditor is approved pursuant to section 327(a) of

the Bankptcy Code on the terms as

requested in the Application, the Engagement Letter and the Johnson Affdavit; and it is further
ORDERED that AMS shall apply for compensation for services rendered and

reimbursement of expenses by fiing a first and final fee application at the conclusion of its work;
and it is further
ORDERED that nothing in this Order shall be deemed to affect any and all rights
that the Official Committee of

Unsecured Creditors or any part-in-interest may have to seek

the Banptcy Code, of any prepetition payments made by

avoidance, pursuant to Chapter 5 of

the Debtors to AMS, and all such rights are hereby expressly preserved and it is fuher
ORDERED that notwithstanding the possible applicabilty of

Fed R.Bank. P.

6004(h), 7062, 9014, or otherwise, the terms and conditions ofthis Order shall be immediately

effective and enforceable upon its entr; and it is fuher

2
~~ i -O1\DS _DE: 14742 i.3

ORDERED that this Cour shall retain jurisdiction to hear and determine all
matters arising from or relating to the implementation of this Order.

Dated:

,2009
The Honorable Kevin 1. Carey
Chief

United States Bankptcy Judge

3
00001 -001 \DOCS_DE: 14742 1.3

IN THE UNITED STATES BANKRUPTCY COURT

In re: )
caused a copy of

FOR THE DISTRICT OF DELAWARE

Chapter 1 1

PACIFIC ENERGY RESOURCES LTD., et al., 1 )

Case No. 09- 1 0785 (KJC)

Debtors. )

(Jointly Administered)

CERTIFICATE OF SERVICE

1"
I, Kathleen P. Makowski, hereby certify that on the~f day of

May 2009, I

the following document to be served on the individuals on the attached service

list in the manner indicated:

Notice and Debtors' Application for Entry of an Order Pursuant to

the Bankruptcy code and Fed. R. Bankr. P. 2014 Authorizing the Employment and Retention of AMS-PAR as Special Joint Interest Biling Auditors to the Debtors and Debtors in Possession
Section 327(a) of

i The Debtors in these cases, along with the last four digits of each of the Debtors' federal tax identification
number, are: Pacific Energy Resources Ltd. (3442); Petrocal Acquisition Corp. (6249); Pacific Energy Alaska

Holdings, LLC (tax I.D. # not available); Cameros Acquisition Corp. (5866); Pacific Energy Alaska Operating LLC (7021); San Pedro Bay Pipeline Company (1234); Cameros Energy, Inc. (9487); and Gotland Oil, Inc. (5463). The
mailing address for all of

the Debtors is 111 W. Ocean Boulevard, Suite 1240, Long Beach, CA 90802.

Pacific Energy Resources Ltd. 2002 Service List

Case No. 09- 1 0785 Document No. 145745

12 - Hand Delivery
39 - First Class Mail 02 - FOREIGN First Class Mail

Hand Delivery (United States Attorney) Ellen W. Slights, Esq. United States Attorney's Office District of Delaware
1007 N. Orange Street, Suite 700

Wilmington, DE 19801
Hand Delivery (Counsel for Silver Point Finance) Ian S. Fredericks, Esquire Skadden Arps, Slate, Meagher & Flom LLP One Rodney Square P.O. Box 636 Wilmington, DE 19899 Hand Delivery (Counsel for 1. Aron & Company) Don A. Beskrone, Esquire Amanda M. Winfree, Esquire Ashby & Geddes, P.A.
500 Delaware Avenue, 8th Floor

Counsel for Debtors) Laura Davis Jones, Esquire James E. O'Neil, Esquire Kathleen P. Makowski, Esquire Pachulski Stang Ziehl & Jones LLP 919 North Market Street, 17th Floor P.O. Box 8705 Wilmington, DE 19899-8705

Interoffice Pouch to Los Angeles

Counsel for Debtors) Robert M. Saunders, Esquire Ira D. Kharasch, Esquire Scotta E. McFarland, Esquire Pachulski Stang Ziehl & Jones LLP
10100 Santa Monica Blvd., 11th Floor

Wilmington, DE 19899
Hand Delivery (Counsel for Union Oil Company of California, a California Corporation) Norman M. Monhait, Esquire Rosenthal, Monhait & Goddess, P A Citzens Ban Center, Suite 1401 919 Market Street, P.O. Box 1070 Wilmington, DE 19899 Hand Delivery (Counsel for Westchester Fire Insurance Company and Noble Energy Inc.) Tobey M. Daluz, Esquire Joshua E. Zugerman, Esquire Ballard Spahr Andrews & Ingersoll, LLP 919 N. Market Street, iih Floor Wilmington, DE 19801

Los Angeles, CA 90067

Hand Delivery (United States Trustee) Joseph McMahon, Esquire Office of the United States Trustee 1. Caleb Boggs Federal Building 844 North King Street, Suite 2207
Lockbox 35

Wilmington, DE 19801
Hand Delivery (Copy Service)
Parcels, Inc.

Vito i. DiMaio 230 N. Market Street Wilmington, DE 19801

Hand Delivery (Counsel for Oxy Long Beach Inc.) David L. Finger, Esquire
Finder, Slanina Liebesman, LLC

First Class Mail

(United States Attorney General) Eric H. Holder, Jr. Office of the Attorney General U.S. Department of Justice 950 Pennsylvania Avenue, N.W. Washington, DC 20530-0002

One Commerce Center 1201 N. Orange St., ih Floor Wilmington, DE 19801

Hand Delivery
(Official Committee of

First Class Mail

Secretary of State Division of Corporations
Franchise Tax

Unsecured Creditors) David B. Stratton, Esquire James C. Carignan, Esquire Pepper Hamilton LLP
Hercules Plaza, Suite 1500 13 1 3 Market Street

P.O. Box 7040 Dover, DE 19903

First Class Mail

Secretary of Treasury P.O. Box 7040 Dover, DE 19903

Wilmington, DE 19899
Hand Delivery (Counsel for Marathon Oil Company) Kevin J. Mangan, Esquire Womble Carlyle Sandridge & Rice, PLLC 222 Delaware Avenue, Suite 1501 Wilmington, DE 19801 Hand Delivery (Counsel for Cook Inlet Region, Inc.) Eric Lopez Schnabel, Esquire Dorsey & Whitney (Delaware) LLP North Market Street, Suite 16th Floor 1 1 05. Wilmington, DE 19801
Hand Delivery (Counsel for Area Energy LLC) Norman L. Pernick, Esquire Karen M. McKinley, Esquire Cole, Schotz, Meisel, Forman & Leonard, P.A. 500 Delaware Avenue, Suite 1410 Wilmington, DE 19801

First Class Mail

Secretary of Treasury 15th & Pennsylvania Avenue, N.W. Washington, DC 20220

First Class Mail

Attn: Insolvency

District Director Internal Revenue Service

31 Hopkins Plaza, Room 1 150

Baltimore, MD 21201

First Class Mail

Internal Revenue Service P.O. Box 21126 Philadelphia, PAl 9114-0326

First Class Mail

Attn: Insolvency Internal Revenue Service
1352 Marrows Road, 2nd Floor
Newark, DE 19711-5445

First Class Mail

Mark Schonfeld, Esq. Regional Director Securities & Exchange Commission New York Regional Office 3 World Financial Center, Suite 400 New York, NY 10281-1022

First Class Mail

SWEPI LP

P.O. Box 576 Houston, TX 77002-0576

First Class Mail

Noble Energy, Inc.

First Class Mail

Michael A. Berman, Esq. Securities & Exchange Commission Office of General Counsel-Bankptcy
100 F Street, N .E.

100 Glenborough, Suite 100 Houston, TX 77067

First Class Mail

(Counsel to Silver Point Finance) Seth Jacobs, Esquire Anna Meresidis, Esquire Skadden, Arps, Slate, Meagher & Flom, LLP 333 West Wacker Drive Chicago, IL 60606-1285

Washington, DC 20549

First Class Mail

Matthew Berry, Esquire Office of General Counsel Federal Communications Commission
445 iih Street, S.W.

First Class Mail

(Counsel to Goldman Sachs and J.Aron & Company) Jeffrey Sabin, Esquire Steven Wilamowsky, Esquire Scott K. Seamon, Esquire Bingham McCutchen LLP
399 Park Avenue

Washington, DC 20554

First Class Mail

POLLARD WIRELINE P.O. Box 1360 Kenai, AK 99611

First Class Mail

Chevron Oil Company
Attn: Steven Lastraps

New York, NY 10022

First Class Mail

(Counsel to Goldman Sachs and J.Aron & Company) Amy Kyle Bingham McCutchen (Boston) One Federal Street
Boston, MA 01221 -1 726

3800 Centerpoint Drive, Suite 100 Anchorage, AK 99503

First Class Mail

California Franchise Tax Board
Banptcy, BE MSA 345

P.O. Box 2952 Sacramento, CA 95812-2952

First Class Mail

First Class Mail

Aera Energy LLC 10000 Ming Avenue Bakersfield, CA 93311- 1164

(Counsel for Union Oil Company of California, a California Corporation) Cabot Christianson, Esquire Christianson & Spraker
911 West 8th Avenue, Suite 201

Anchorage, AK 99501

First Class Mail

Linda Lautigar

First Class Mail

(Counsel for Westchester Fire Insurance Company) Robert McL. Boote, Esquire Ballard Spahr Andrews & Ingersoll, LLP 1735 Market Street, 51st Floor Philadelphia, P A 19103

Bankptcy Coordinator
MMS 1 Denver Federal Center POBox 25165 Mail Stop 370B2 Denver, CO 80225

First Class Mail

Kristina Engelbert RDI Royalty Distributors, Inc.
PO Box 24116

First Class Mail

(Counsel for Rosecrans Energy, Ltd. And Sherwin D. Yoelin) John J. Harris, Esquire Rachel M. F eiertag, Esquire Meyers, Nave, Riback, Silver & Wilson 333 South Grand Avenue, Suite 1670 Los Angeles, CA 90071

Tempe, AZ 85285

First Class Mail

MTGLQ Investors, L.P. 85 Broad Street New York, New York 10004

First Class Mail

First Class Mail
Goldman Sachs E&P Capital Attn: John K. Howie 1000 Louisiana, Suite 550 Houston, Texas 77002 (Counsel for Oxy Long Beach Inc.) Richard M. Kremen, Esquire
Jodie E. Buchman, Esquire

DLA Piper LLP (US)

6225 Smith Avenue

Baltimore, MD 21209

First Class Mail

SPCP Group, L.L.C.
Two Greenwich Plaza, 1 st Floor

First Class Mail

(Counsel for Noble Energy Inc.) Rhett G. Campbell, Esquire Mitchell E. Ayer, Esquire Thompson & Knight LLP 333 Clay Street, Suite 3300 Houston, TX 770022

Greenwich, CT 06830

First Class Mail

Seth E. Jacobson, Esquire L. Byron Vance III, Esquire Skadden, Arps, Slate, Meagher & Flom LLP 333 West Wacker Drive, Suite 2100 Chicago, IL 60606

First Class Mail (Offcial Committee of Unsecured

Creditors) Francis 1. Lawall, Esquire Pepper Hamilton LLP 3000 Two Logan Square Eighteenth & Arch Streets
Philadelphia, PAl 91 03

First Class Mail (Counsel to United States Deparment of

Interior, including the Minerals
Management Service)

E. Kathleen Shahan, Esquire U.S. Deparment of Justice 1100 L Street, NW Washington, D.C. 20005

First Class Mail

(Official Committee of

First Class Mail

(Counsel for Aera Energy LLC) Steven E. Rich, Esquire Mayer Brown LLP
350 South Grand Avenue, 25th Floor

Unsecured Creditors) Filiberto Agusti, Esquire

Steven Reed, Esquire

Joshua Taylor, Esquire Steptoe & Johnson LLP 1330 Connecticut Avenue NW Washington, DC 20036

Los Angeles, CA 90071

First Class Mail

(Claims representative for the County of Kern)

First Class Mail

(Official Committee of

Attn: Banptcy Division

Unsecured
clo Linda Delgado P.O. Box 579 Bakersfield, CA 93302

Creditors) Robbin Itkin, Esquire Katherine Piper, Esquire Kelly Frazier, Esquire Steptoe & Johnson LLP
2121 Avenue of

FOREIGN First Class Mail

TSX Kerry D. Krochak, B.A., LL.B. Manager, Listed Issuer Services Toronto Stock Exchange 300 Fifth Avenue SA, 10th Floor Calgary, AB T2P 3C4

the Stars, 28th Floor

Los Angeles, CA 90067

First Class Mail

(Counsel for Cook Inlet Region, Inc.)
Michael R. Mils, Esquire

Dorsey & Whitney LLP

1031 W. 4th Ave., Suite 600

FOREIGN First Class Mail

(Transfer Agents)
Bernadette Vilarica

Anchorage, AK 99501

Relationship Manager, Client Services

First Class Mail

(Counsel for the State of Alaska) Lorenzo Marinuzzi, Esquire Morrison & Foerster LLP
1290 Avenue of

Computershare Investor Services Inc.

510 Burard Street, 3rd Floor Vancouver, BC V6C 3B9

the Americas

New York, NY 10104

First Class Mail

(Counsel for DCFS Trust subservicer for
DCFS Trust)

Marin A. Mooney, Esquire Deily, Mooney & Glastetter, LLP 8 Thurlow Terrace Albany, NY 12203