BEFORE THE OIL AND GAS CONSERVATION COMMISSION
OF THE STATE OF COLORADO
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IN THE MATTER OF THE RULE 303.j COMPLAINT OF NICKEL ROAD OPERATING LLC REQUESTING THAT THE DIRECTOR WITHHOLD APPROVAL OF EXTRACTION OIL & GAS, INC’S NINE FORM 2 APPLICATIONS FOR PERMITS TO DRILL CERTAIN NAMED FALCON WELLS IN SECTIONS 7 AND 8, TOWNSHIP 7 NORTH, RANGE 65 WEST, 6TH P.M., AND SECTION 12, TOWNSHIP 7 NORTH, RANGE 66 WEST, 6TH P.M., WATTENBERG FIELD, WELD COUNTY, COLORADO |
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CAUSE NO. 1
DOCKET NO. 180700626
TYPE: GENERAL ADMINISTRATIVE
ORDER NO. 1-223 |
REPORT OF THE COMMISSION
The Commission heard this matter on September 18, 2018, at the Garfield County Sheriff's Annex – Rifle, 106 County Road 333-A, Rifle, Colorado 81650 upon exceptions to the Hearing Officer’s Order Dismissing Applications.
The Commission finds as follows:
1. Nickle Road Operating LLC “(Nickle Road”) (Operator No. 10669) is an interested party in the subject matter of the above-referenced hearing.
2. Extraction Oil & Gas, Inc. (“Extraction”) (Operator No. 10459) is an interested party in the subject matter of the above-referenced hearing.
3. The Director of the Commission is an interested party in the subject matter of the above-referenced hearing.
4. Due notice of time, place and purpose of the hearing has been given in all respects as required by law.
5. The Commission has jurisdiction over the subject matter embraced in said notice and the parties interested therein, and has authority to promulgate the hereinafter prescribed order pursuant to the Oil and Gas Conservation Act (“Act”).
PROCEDURAL AND FACTUAL HISTORY
6. On May 22, 2018, Extraction filed an application (“Extraction Falcon Spacing Application”) with the Commission in Docket No. 180700527 for an order to, among other things, establish an approximate 1,600-acre drilling and spacing unit for the below-described lands, and to authorize the drilling of up to 20 horizontal wells within the proposed unit for the production of oil, gas and associated hydrocarbons from the Codell-Niobrara Formation (the “Extraction Falcon Application Lands”):
Township 7 North, Range 65 West, 6th P.M.
Section 7: All
Section 8: W1/2
Township 7 North, Range 65 West, 6th P.M.
Section 12: All
7. On April 13, 2018, one month prior to filing the Extraction Falcon Spacing Application, Extraction submitted nine Form 2, Applications for Permits to Drill (“Falcon APDs”), for wells within the Extraction Falcon Application lands. On May 17, 2018, Extraction submitted a Form 2A, Oil and Gas Location Assessment, for surface facilities in the Extraction Falcon Application Lands (collectively the “Extraction Falcon Permit Applications”).
8. On May 11, 2018, Nickel Road filed a complaint with the Director pursuant to Rule 303.j. (“303.j. Complaint”) which alleged that the Falcon APDs violated the Act.
9. On May 16, 2018, the Director dismissed Nickel Road’s Rule 303.j. Complaint.
10. On May 29, 2018, Nickel Road filed an application in Docket No. 180700626 requesting that the Commission hear and overturn the Director’s dismissal of their 303.j. Complaint (“Nickel Road’s 303.j. Application”).
11. On July 16, 2018, Extraction filed a Protest to Nickel Road’s 303.j. Application.
12. On July 17, 2018, the Director filed a Notice of Opposition to Nickel Road’s 303.j. Application.
13. On August 28, 2018, the Hearing Officer dismissed the Nickel Road’s 303.j. Application on the grounds that Rule 303 contains no mechanism for requesting review of the Director’s dismissal of Nickel Road’s 303.j. Complaint.
14. On September 6, 2018, Nickel Road filed an Exception to the Hearing Officer’s dismissal requesting that the Commission reverse the Hearing Officer’s dismissal and hear Nickel Road’s arguments regarding Extraction’s Falcon Permit Applications (“Exception”).
HEARING
15. This matter was scheduled to be heard by the Commission at its September 17-18, 2018 meeting.
16. In a hearing immediately prior to this matter, the Commission denied the Extraction Falcon Spacing Application and directed Extraction to withdraw the Extraction Falcon Permit Applications.
17. Counsel for Nickel Road represented that, based on the Commission’s denial of the Extraction Spacing Application and direction to Extraction to withdraw the the Extraction Falcon Permit Applications, Nickel Road’s Exception was moot and Nickel Road withdrew the Exception.
ORDER
IT IS HEREBY ORDERED:
1. Nickel Road’s Exception is deemed WITHDRAWN.
2. The Hearing Officer’s dismissal of Nickel Road’s 303.j. Application in Docket No. 180700626 STANDS.
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 35 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 15th day of October, 2018, as of September 18, 2018.
OIL AND GAS CONSERVATION COMMISSION
OF THE STATE OF COLORADO
By________________________________
Julie Spence Prine, Secretary
CERTIFICATE OF SERVICE
The undersigned hereby certifies that on the ___ day of October, 2018, a true and correct copy of this Order was served on the following by email and U.S. Mail, first-class postage prepaid, at the addresses shown below:
Attorneys for Complainant:
Jamie L. Jost
Kelsey H. Wasylenky
Jost Energy Law, P.C.
1401 17th Street, Suite 370
Denver, Colorado 80203
(720) 446-5620
Attorneys for Extraction Oil & Gas, Inc.
Robert A. Willis
Poulson, Odell & Peterson, LLC
Attorney for Extraction
_______________________________
Margaret Humecki