IN THE MATTER OF THE PROMULGATION AND ESTABLISHMENT OF FIELD RULES TO GOVERN OPERATIONS IN THE McCLAVE FIELD, BENT AND KIOWA COUNTIES, COLORADO Cause No. 105 Order No. 105-10

REPORT OF THE COMMISSION

This cause came on for hearing before the Commission on April 17, 1973, at 9 A.M., in the Auditorium, Social Services Building, 1575 Sherman St., Denver, Colorado, after giving Notice of Hearing as required by law, on the application of Texas Oil and Gas Corporation, for an order granting an exception to the spacing pattern established by Order Nos. 105-1 and 105-2 for a well to be drilled in the center of the SE/4SE/4 Section 29, Township 20 South, Range 48 West, 6th P.M., Kiowa County, Colorado, and that it be the permitted well for the drilling and spacing unit upon which "it is to be located.

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.

3. That on May 15, 1957, the Commission issued its Order No. 105-1 which, among other things, established 640-acre drilling and spacing units for the pro-duction of gas from the McClave Sand underlying the McClave Field. The order was amended by Order No. 105-2 which provided for the permitted well to be located within a radius of 990 feet from the center of the drilling and spacing unit upon which it is located, with exceptions for topographical reasons. Subsequent orders were issued extending the field limits.

4. That a well has been drilled in the permitted location in the NE/4SW/4 of Section 29, Township 20 South, Range 48 West, 6th P.M., and was plugged and aban-doned as a dry hole.

5. That evidence presented at the hearing indicates that an exception to the spacing pattern as established by Order Nos. 105-1 and 105-2 in the McClave Field should be granted for a well to be drilled in the center of the SE/4SE/4 of Section 29, Township 20 South, Range 48 West, 6th P.M., and that it be the permitted well for the drilling unit upon which it is located; however, if a commercial well is completed at the location set forth above, the Commission should, upon application of any interested person, take such action as will offset any advantage which the person securing the ex-ception may have over other producers by reason of the drilling of the well as an excep-tion, including suitable provisions to prevent the production from the drilling unit of more than its just and equitable share of gas in the pool.

(over)

ORDER

NOW, THEREFORE, IT IS ORDERED, an exception is hereby granted for a well to be drilled in the center of the SE/4SE/4 of Section 29, Township 20 South, Range 48 West 6th P.M., McClave Field, Kiowa County, Colorado, and that said well shall be the permitted well for the drilling unit upon which it is located; however, if a commercial well is completed at the location set forth above, the Commission shall, upon application of any interested person, take such action as will offset any advantage which the person securing the exception may have over other producers by reason of the drilling of the well as an exception.

IT IS FURTHER ORDERED that the provisions contained in the above order shall become effective herewith.

ORDERED this 17th day of April 2973

THE OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO

By Frank J. Piro, Secretary

- 2 --(#105-10)