BEFORE THE OIL AND GAS CONSERVATION COMMISSION
OF THE STATE OF COLORADO

 

IN THE MATTER OF THE APPLICATION OF ENTEK GRB, LLC REQUESTING: 1) A VARIANCE FROM RULE 303.j.(1) TO OBTAIN A DRILLING PERMIT EXTENSION FOR THE  FOCUS RANCH UNIT FEDERAL 3-1 WELL LOCATED IN SECTION 3, TOWNSHIP 11 NORTH, RANGE 88 WEST, 6TH P.M.; AND 2) EQUITABLE TOLLING OF THE JUNE 29, 2013 PERMIT EXPIRATION FOR THE FOCUS RANCH UNIT FEDERAL 3-1 WELL  FOR THE NIOBRARA FORMATION, UNNAMED FIELD, ROUTT COUNTY, COLORADO

)

)

)

)

)

)

)

)

)

)

CAUSE NO. 1

 

DOCKET NO. 1307-GA-03

 

ORDER NO. 1-185

 

REPORT OF THE COMMISSION

 

            The Commission heard this matter on July 29, 2013, at offices of the Colorado Oil and Gas Conservation Commission, 1120 Lincoln Street, Denver, Colorado, upon application for an order seeking: 1) a variance from Rule 303.j.(1) to obtain a drilling permit extension for the Focus Ranch Unit Federal 3-1 Well, Permit No. 1636575, located in Section 3, Township 11 North, Range 88 West, 6th P.M., for the production of oil, gas and associated hydrocarbons from the Niobrara Formation, and 2) equitable tolling of the June 29, 2013 expiration of the permit for the Well pending a full hearing by the Commission.

 

FINDINGS

 

The Commission finds as follows:

 

1.         ENTEK GRB, LLC (“Entek” or “Applicant”), 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 pursuant to the Oil and Gas Conservation Act.

 

4.         Rule 502.b.(1) provides that the operator or the applicant requesting a variance shall make a showing that it has made a good faith effort to comply, or is unable to comply with the specific requirements contained in the rules, regulations, or orders, from which it seeks a variance, including, without limitation, securing a waiver or an exception, if any, and that the requested variance will not violate the basic intent of the Oil and Gas Conservation Act.

 

5.         On June 30, 2011 the Commission, through Director David Neslin, issued Permit No. 1636575 (“Permit”), for the Focus Ranch Unit Federal 3-1 Well (API No. 05-107-06229) (“Well”) in Routt County, Colorado.  The Permit expires on June 29, 2013.

 

6.         On June 28, 2013, Entek, by its attorneys, filed with the Commission a verified application (“Application”) for an order seeking: 1) a variance from Rule 303.j.(1) to obtain a drilling permit extension for the Well located on the below-described lands (“Application Lands”) for the production of oil, gas and associated hydrocarbons from the Niobrara Formation, and 2) equitable tolling of the June 29, 2013 expiration of the permit for the Well pending a full hearing by the Commission:

 

            Township 11 North, Range 88 West, 6th P.M.

            Section 3:        SE¼ NE¼

 

In support of the Application, Entek states that surface access to the Well depends upon approval of an access road that is included as part of a Geographic Area Plan (“GAP”) and that the approval of the GAP has been significantly delayed due to factors beyond Entek’s control.  Further, wildlife stipulations in Routt County limit Entek’s ability to operate to a window between July 1 and November 30 and other regulatory timing issues will greatly delay Entek’s ability to drill the Well absent the requested extension.

 

7.         On July 29, 2013, Entek, by its attorneys, appeared before the Commission to request approval the Application based on the merits of the verified Application, testimony provided by its expert witnesses and supporting exhibits.

 

8.         Testimony and exhibits submitted in support of the Application by Entek, by its attorneys, showed Entek is working with the Routt County Government and the Bureau of Land Management to obtain full permit approval to drill, but due to several delays beyond Entek’s control, it was unable to do so.  Testimony concluded that extending the permit expiration would allow for the efficient and economic extraction of hydrocarbons, would prevent waste and would not damage correlative rights, consistent with the Oil and Gas Conservation Act, §34-60-117.

 

9.         Testimony from the Hearing Officer, Roger M. Allbrandt, showed the Commission had previously approved a similar extension to the permit-to-drill in Order No. 1-172, Docket No. 1203-GA-01, for the State Chase 33-36 Well.

 

10.       The above-referenced testimony and exhibits show that granting the Application will allow more efficient reservoir drainage, will prevent waste, will assure a greater ultimate recovery of hydrocarbons, and will not violate correlative rights.

 

11.       Entek agreed to be bound by oral order of the Commission. 

 

12.       Based on the facts stated in the verified Application, having received no protests, and based on the Hearing Officer review of the Application under Rule 511, the Commission should enter an order seeking: 1) a variance from Rule 303.j.(1) to obtain a drilling permit extension for the Focus Ranch Unit Federal 3-1 Well, Permit No. 1636575, located in Section 3, Township 11 North, Range 88 West, 6th P.M., for the production of oil, gas and associated hydrocarbons from the Niobrara Formation, and 2) equitable tolling of the June 29, 2013 expiration of the permit for the Well pending a full hearing by the Commission.

 

ORDER

 

IT IS HEREBY ORDERED:

 

1.         A variance from Rule 303.j.(1) to obtain a drilling permit extension for the Focus Ranch Unit Federal 3-1 Well, Permit No. 1636575, located in Section 3, Township 11 North, Range 88 West, 6th P.M., is hereby approved.

 

2.         The expiration date of June 29, 2013 for Permit No. 1636575, is hereby extended to November 30, 2014.

 

IT IS FURTHER ORDERED:

 

1.         The provisions contained in the above order shall become effective immediately.

 

2.         The Commission expressly reserves its right, after notice and hearing, to alter, amend or repeal any and/or all of the above orders.

 

3.         Under the State Administrative Procedure Act the Commission considers this Order to be final agency action for purposes of judicial review within 30 days after the date this Order is mailed by the Commission.

 

4.         An application for reconsideration by the Commission of this Order is not required prior to the filing for judicial review.

 

ENTERED this   27   day of August, 2013, as of July 29, 2013.

           

 

                                                                        OIL AND GAS CONSERVATION COMMISSION

                                                                        OF THE STATE OF COLORADO

 

 

                                                                        By____________________________________       

                                                                                    Robert J. Frick, Secretary