REPORT OF THE COMMISSION

REPORT Of THE COMMISSION This cause came on for hearing before the Commission on November 21, 1977, 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 Kansas-Nebraska Natural Gas: Company, Inc., for an order establishing 640-acre drilling and spacing units for the pro-duction of gas from the Niobrara formation underlying certain lands in Yuma County, Colorado.

FINDINGS

The Commission finds as follows:

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

2. That 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.

8. That evidence presented at the hearing indicates that the Niobrara for-mation constitutes a common source of supply of gas underlying the following described lands in Yuma County, Colorado, to-wit:

Township 3 North, Range 46 West, 6th P.M. Sections 7 thru 11, 14 thru 23

4. That in order to prevent the waste of gas, as defined by law; to protect the correlative rights of all parties concerned; to prevent the drilling of unnecessary wells, and to insure proper and efficient development and promote conservation of the gas resources of the St ate, an order should be made establishing 640-acre drilling and spacing units for the production of gas from the Niobrara formation, common source of supply underlying the lands defined herein; that said units should be 640-acre drilling units, and consist of a section of land according to the governmental survey thereof, and that the permitted well for each such drilling unit should be located no closer than 990 feet from the boundaries of the quarter section upon which it is located; however, the presently producing wells or wells capable of producing, should be the permitted wells for the units upon which each is located.

5. That all available geological and engineering data concerning said Nio-brara formation indicate that one well will efficiently and economically drain an area of approximately 640-acres, and that drilling units of the size and shape hereinabove described are not smaller than the maximum area that can be efficiently drained by one well producing from said Niobrara formation.

6. That a hearing should be held in nine (9) months, at which time the Commission should review data obtained from additional development in the spaced area in order to determine whether the spacing as established by this order should be continued

ORDER

NOW, THEREFORE, IT IS ORDERED, that the following rules and regula-tions shall apply hereafter to wells drilled, completed or recompleted in the Niobrara formation underlying the Buckboard Field herein described, in addition to other applicablle (over) rules and regulations and orders of the Commission, if any, heretofore adopted and not in conflict herewith:

Rule 1. Six Hundred Forty (640) acre drilling and spacing units shall be and the same are hereby established for the production of gas from the Niobrara forma-tion underlying the following described lands in the Buckboard Field, Yuma County, Colorado, to-wit:

Township 3 North, Range 46 West, 6th P.M. Sections 7 thru 11, 14 thru 23

Rule 2. Said drilling units shall consist of six hundred forty (640) acres, and each such drilling unit shall consist of a section of land, according to the govern-mental survey thereof, and the permitted well for each such drilling unit shall be located no closer than 990 feet from the boundaries of the quarter section upon which it is located; however, the presently producing wells, or wells capable of producing shall be the per-mitted wells for the units upon which each is located.

IT IS FURTHER ORDERED, that a hearing shall be held in nine [9) months, at which time the Commission shall review data obtained from additional development in the spaced area in order to determine whether the spacing as established by this order shall be continued.

IT IS FURTHER ORDERED, that the rules and regulations contained herein 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, rules and regulations.

ORDERED this 21st day of November, 1977.

THE OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO

By Frank J. Piro, Secretary

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