REPORT OF THE COMMISSION

This cause came on for hearing before the Commission on June 19, 1978 at 9 A.M., in Room 110, State Centennial Building, Denver, Colorado, after giving Notice of Hearing, as required by law, on the application of Energy Minerals Corporation for an order to allow the drilling of an additional well on each 80-acre drilling and spacing unit for production of oil and associated hydrocarbons from the Shannon formation under-lying the SE/4 Section 18, Township 2 North, Range 67 West, 6th P.M. The application was amended at the time of the hearing to exclude the NW/4 SE/4 of said Section 13.

FINDINGS

The Commission finds as follows:

1. Energy Minerals Corporation, as applicant herein, is an interested party in the subject matter of the above-referenced hearing.

2. Due notice of the time, place and purpose of the hearing has been given in all respects as required by law.

3. The Commission has jurisdiction over the subject matter embraced in said Notice, and of the parties interested therein, and jurisdiction to promulgate the hereinafter prescribed order.

4. On February 16, 1976, the Commission issued its Order No. 250-11 for the Spindle Field, which, among other things, revised the spaced area for the Spindle Field and established 80-acre drilling and spacing units for the production of oil and associated hydrocarbons from the Sussex and Shannon formations underlying said field. The order was amended by Order No. 250-22 which allowed the drilling of an additional well in each 80-acre drilling unit in the Spindle Field. However, certain lands were not included as part of the area where additional drilling is allowed; the SE/4 Section 18, Town-ship 2 North, Range 67 West, 6th P.M. being such lands not included.

5. Evidence presented at the hearing indicates that one well will not adequately drain the oil and associated hydrocarbons from an area of 80-acres from the Shannon formation underlying the area described herein, and the drilling of an additional well will result in greater ultimate recovery of the oil reserves and will prevent waste; the application requests authorization to drill an additional well in the SE/4 SE/4 Section 18, Township 2 North, Range 67 West, 6th P.M.

ORDER

NOW, THEREFORE, IT IS ORDERED, that an additional well is hereby authorized to be drilled on the 80-acre drilling and spacing unit previously established in the SE/4 Section 18, Township 2 North, Range 67 West, 6th P.M., for the production of oil and associated hydrocarbons from the Shannon formation. Such additional well shall be located in the center of the SE/4 SE/4 of said Section 18, with a tolerance of 200 feet to avoid surface hazards or obstructions.

(over)

IT IS FURTHER ORDERED, that the provisions contained in this order shall become effective forthwith.

ORDERED this 19th day of June, 1978.

THE OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO

By Frank J. Piro, Secretary

-- 2 --(#250-17)