IN THE MATTER OF THE PROMULGATION AND
CAUSE NO. 315
ESTABLISHMENT OF FIELD RULES TO GOVERN
OPERATIONS IN THE VERNON FIELD,
ORDER NO. 315-7
YUMA COUNTY, COLORADO
REPORT OF THE COMMISSION
This cause came on for hearing before the Hearing Officers at 10:00 a.m. on
January 7, 2002 in Room 201, Greeley Recreation Center, 651 10th Avenue,
Greeley, Colorado on the application of Williams Production RMT Company for an
order to amend Order Nos. 315-3 and 315-5 to allow any well drilled as the
initial well in a 160-acre drilling and spacing unit to be located no closer
than 560 feet from the outer boundaries of the 160-acre drilling and spacing
unit for certain lands in the Vernon Field.
FINDINGS
The Commission finds as follows:
1. Williams Production RMT Company 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 January 17, 1977, the Commission issued Order No. 315-1, which established
640-acre drilling and spacing units for the production of gas and associated
hydrocarbons from the Niobrara Formation with the permitted well to be located
no closer than 990 feet from the unit boundary underlying certain lands in the
Vernon Field. The spaced area was extended by Order No. 315-2 issued November
17, 1977. By Order No. 315-3, dated August 22, 1978 and upheld by Order No.
315-4 dated September 9, 1981, the size of the drilling and spacing units within
the spaced area was reduced to 160-acres with the permitted well to be located
no closer than 900 feet from the unit boundaries for the below-listed lands:
Township 1 South, Range 44 West, 6th P.M.
Sections 3 thru 10: All
Sections 16 thru 21: All
Sections 27 thru 34: All
Township 2 South, Range 44 West, 6th P.M.
Sections 3 thru 6: All
Township 1 North, Range 44 West, 6th P.M.
Sections 32 and 33: All
5. Subsequent Order No. 315-5 issued June 4, 1999 allowed an additional well to
be drilled and completed on the 160-acre drilling and spacing units for the
below-listed lands:
Township 1 South, Range 44 West, 6th P.M.
Section 3: NW¼
Sections 7 and 8: All
Section 17: E½
Section 29: W½
6. On November 19, 2001, Williams Production RMT Company (“Williams”), by its
attorney filed with the Commission a verified Application for an order to amend
Order Nos. 315-3 and 315-5 to allow any well drilled as the initial well in a
160-acre drilling and spacing unit to be located no closer than 560 feet from
the outer boundaries of the 160-acre drilling and spacing unit for the
below-listed lands, and to allow the Director authority to grant an exception
location to the permitted well location without prior notice or hearing upon an
adequate showing by the operator that topography makes it unreasonable to drill
a well within a 560 feet setback, but no closer than 380 feet from the boundary
of the drilling and spacing unit.
Township 1 South, Range 44 West, 6th P.M.
Section 3: NW¼
Sections 7 and 8: All
Section 17: E½
Section 29: W½
7. On December 12, 2001 a protest to the application was filed by Patricia J.
Wood, Gary Neil Gillett, and L. Hollis Gillett, owners and operators dba Diamond
G Farms LLP stating that the drilling of additional wells will become a
financial hardship for its farming operation. The COGCC Hearings Manager
contacted Ms. Wood and Mr. Gary Gillett on December 12, 2001 to advise them that
the application was not requesting approval to drill additional wells and to
explain the relief requested in the application. On December 17, 2001, a new
protest to the application was filed by Diamond G Farms LLP stating its
opposition to 560 foot setbacks.
8. On December 19, 2001, COGCC staff held a prehearing conference with Gary
Gillett and Williams to discuss the protest and to describe the basis for the
application requesting a revised setback. Mr. Gillett stated he would report to
Ms. Wood and Mr. L. Hollis Gillett on the information he obtained during the
prehearing conference and together they would decide whether or not to withdraw
the protest. The Hearings Manager recommended that the protest not be considered
valid based on the COGCC definition of a protestant and the lack of compliance
with Rule 509. a.(3).
9. An administrative hearing was held in this matter and at the time of the
administrative hearing Williams withdrew from the application the request to
allow the Director authority to grant an exception location no closer than 380
feet from the boundary of the drilling and spacing unit without prior notice and
hearing.
10. Testimony presented at the administrative hearing indicated that a change in
well location setbacks is necessary to allow flexibility in locating wells and
optimizing drainage.
11. At the time of the administrative hearing, Williams Production RMT Company
agreed to be bound by oral order of the Commission.
12. The Commission should enter an order to allow any well drilled as the
initial well in the 160-acre drilling and spacing units described above in
Finding No. 5 to be located no closer than 560 feet from the outer boundaries of
the 160-acre drilling and spacing unit.
13. On December 26, 2001, Gary Gillett contacted the COGCC and verbally withdrew
the Diamond G Farms LLP protest; accordingly this matter was placed on the
Commission’s consent agenda. On January 7, 2002 a written withdrawal of the
protest was filed with the Commission.
ORDER
NOW, THEREFORE IT IS ORDERED, that Order Nos. 315-3 and 315-5 are hereby amended
to allow any well drilled as the initial well in a 160-acre drilling and spacing
unit to be located no closer than 560 feet from the outer boundaries of the
160-acre drilling and spacing unit for the below-listed lands:
Township 1 South, Range 44 West, 6th P.M.
Section 3: NW¼
Sections 7 and 8: All
Section 17: E½
Section 29: W½
IT IS FURTHER ORDERED, that the provisions contained in the above order shall
become effective forthwith.
IT IS FURTHER ORDERED, that the Commission expressly reserves its right, after
notice and hearing, to alter, amend or repeal any and/or all of the above
orders.
ENTERED this 11th day of January, 2002, as of January 7, 2002.
OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO
By Dated at Suite 801 Patricia C. Beaver, Secretary 1120 Lincoln Street Denver, Colorado 80203 January 11, 2002.
(315#7)