BEFORE THE OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO
IN THE MATTER OF THE PROMULGATION AND ESTABLISHMENT OF FIELD RULES TO GOVERN OPERATIONS IN THE "D" SAND OF THE ELM GROVE FIELD, LOGAN COUNTY, COLORADO	) ) ) )	CAUSE NO. 110 ORDER NO. 110-3

REPORT OF THE COMMISSION

This cause came on for hearing before the Commission on January 26, 1960, at 10:00 a.m., in the Game Room of the Albany Hotel, Denver, Colorado, after publication of Notice of Hearing as required by law, on the application of the Pan American Petroleum Corporation for an order amending Rule 2 of Order No. 110-2, to establish gas allowables on a lease basis rather than on a per well basis; and providing that the daily allowable gas production from any lease in the Elm Grove Field shall be equal to the sum of the gas producing capacities of all producing wells on said lease; provided, however, that f or [sic] the purpose of calculating such lease allowable, no well shall be considered to have a gas producing capacity in excess of 200,000 cubic feet per day, even though its actual producing capacity be greater than 200,000 cubic feet per day; and that the Commission make such amendments or additions to said Order No. 110-2 as may be found necessary to secure the most efficient use of the reservoir energy and to protect the correlative rights of all parties affected by said order.

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 the Commission issued its Order No. 110-2 on March 14, 1958, which, among other things, established a daily gas allowable of 200,000 cubic feet from each well in the Elm Grove Field.

4.      That the engineering testimony presented at the hearing indicates that Order No. 110-2 should be amended to allow the daily gas allowable from each well to be transferred and produced from any other well or combination of wells on the same lease in order to produce any one lease in the most efficient manner possible.

ORDER

NOW, THEREFORE, IT IS ORDERED, that Order No. 110-2 is hereby amended, and the following rules and regulations shall hereafter apply to the "D" sand formation of the Elm Grove Field, Logan County, Colorado:

Rule 1.    The daily allowed gas production from each well shall be Two Hundred Thousand (200, 000) cubic feet; and no well shall vent more than an average of Fifty Thousand (50, 000 [sic]) cubic feet of gas per day during any one (1) month, provided that no gas shall be released directly or indirectly into the open air from wells having a gas-oil ratio of Twenty Thousand (20,000) cubic feet of gas to One (1) barrel of oil, or greater, except in cases of emergency or when otherwise authorized, and when any well reaches a gas-oil ratio of Twenty Thousand (20,000) cubic feet of gas to one barrel of oil, such, well shall be classified as a gas well.

a.      In order that the operators may produce any one lease in the most efficient manner possible, the gas allowable for any well or combination of wells on any given lease may be transferred and produced by any other well or combination of wells on the same lease; provided, however, that in no case shall there be transferred an allowable greater than 200, 000 [sic] cubic feet, or the capacity of the well if less than 200, 000 [sic] cubic feet.

b.      Underproduction of gas during any one month may be made up only during the month immediately following; and any overproduction of gas during any one month shall be made up during the month immediately following.

Rule 2.    The operators and owners of wells producing from the "D" sand formation of the Elm Grove Field shall make a gas-oil-ratio test of each of their producing oil wells during every quarter, beginning with the months of January, April, July and October, unless otherwise authorized; and such tests shall be taken during the first fifteen (15) days of the last month of each quarter, the results of which such tests shall be reported to the Commission on or before the twenty-fifth (25th) day of the last month of every quarter; and such tests shall be the basis for calculating the volume of oil or gas allowed to be produced; and, immediately prior to making the test for a gas-oil ratio, subject well shall be produced in its normal manner for at least twenty-four (24) hours; and during such tests, subject well shall be produced at a volume equal to or not exceeding its daily allowable by more than twenty-five (25) percent, if capable; and a schedule shall be submitted to the office of the Commission and offset operators prior to testing, showing the wells and respective dates of tests; and the volume of gas measured shall be reported in units of cubic feet at a base pressure of 15,025 psia, and a base temperature of 60° Fahrenheit.

Rule 3.    The operators and owners of wells producing from the "D" sand formation of the Elm Grove Field shall file with the Commission a monthly report of production by wells, as required on Form OGCC-7a, covering the month next preceding the date of filling, on or before the twenty-fifth (25th) day of each month, unless otherwise authorized.

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 26th day of January 1960.

OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO
	By  D.V. Rogers, Secretary