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 FOR THE FRUITLAND COAL
SEAMS FORMATION, IGNACIO-BLANCO FIELD, ARCHULETA COUNTY, COLORADO
|
)
)
)
)
)
)
)
|
CAUSE NO. 112
DOCKET NO. 170600397
TYPE:
ADDITIONAL WELLS
ORDER NO. 112-273
|
REPORT OF THE COMMISSION
The Commission heard this matter on June 12, 2017, at the Rio Blanco County Courthouse, 555 Main Street, Meeker,
Colorado, upon application for an order to
approve a total of two horizontal wells within an approximate 320-acre drilling and spacing unit established
for Section 15, Township
33 North, Range 5 West, N.M.P.M., for the production of oil, gas and associated
hydrocarbons from the Fruitland
Coal Seams Formation.
FINDINGS
The Commission finds as follows:
1.
Petrox Resources, Inc.
(Operator No. 69805) (“Petrox” or “Applicant”) 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.
5.
On April 13, 2017, Petrox, by its attorneys, filed
with the Commission a verified application (“Application”) for an order to: 1)
approve an additional horizontal well, for a total of two horizontal wells,
within an approximate 320-acre
drilling and spacing unit established for the
below-described lands (“Application Lands”) for the production of oil, gas and associated
hydrocarbons from the Fruitland
Coal Seams Formation;
2) provide that for the
permitted horizontal wells the surface locations for the wells may be anywhere
within the approximate 320-acre drilling and spacing unit established for the
Application Lands or upon adjacent lands; 3) provide that the horizontal
laterals of the wells may enter the Fruitland Coal Seams Formation anywhere
within the boundaries of the approximate 320-acre drilling and spacing unit
established for the Application Lands or upon adjacent lands; and 4) provide
that the treated intervals of the horizontal laterals of the wells may not be
any closer than 660 feet to the boundaries of the approximate 320-acre drilling
and spacing unit, and the treated intervals of the horizontal laterals of the
wells shall be no closer than 330 feet to any horizontal or vertical wells
completed in and producing from the same formation, unless an exception is
granted by the Director:
Township 33 North, Range 5 West, N.M.P.M.
Section 15: W½
6.
On May 22, 2017, Petrox, by its attorneys,
filed with the Commission a written request to approve the Application, based
on the merits of the verified Application and the supporting exhibits. Sworn
written testimony and exhibits were submitted in support of the Application.
7.
Land testimony
and exhibits submitted in support of the Application by Steven A. Muns, Land
Manager for EXOK, testifying on behalf of Petrox, showed that Petrox owns substantial leasehold interests and has a right to drill in the
Application Lands.
8.
Geologic testimony and
exhibits submitted in support of the Application by Michael J. Clark, owner of
Petrox, showed that the Fruitland
Coal Seams Formation is present throughout the Application Lands,
is approximately 30 to 45 feet thick, and is generally of uniform thickness
throughout the Application Lands.
9.
Engineering testimony
and exhibits submitted in support of the Application by Michael J. Clark, owner
of Petrox, showed that the drainage area calculated for horizontal Fruitland Coal Seams Formation well is estimated at 2.1 acres,
and an approximate 320-acre drilling and spacing unit is therefore not less
than the maximum area than can be efficiently, economically and effectively
drained by a horizontal well producing oil, gas and associated hydrocarbons
from the Fruitland Coal Seams
Formation.
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.
Petrox 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 to approve a
total of two horizontal wells within an approximate 320-acre drilling and spacing unit established
for Section 15, Township
33 North, Range 5 West, N.M.P.M., for the production of oil, gas and associated
hydrocarbons from the Fruitland
Coal Seams Formation.
ORDER
IT IS HEREBY ORDERED:
1.
A total of two
horizontal wells in an approximate 320-acre drilling and spacing unit for the
below-described lands are hereby approved for the production of oil, gas and
associated hydrocarbons from the Fruitland Coal Seams Formation:
Township 33 North, Range 5 West, N.M.P.M.
Section 15: W½
2.
The
productive interval of any horizontal well drilled for the Fruitland Coal Seams Formation shall be located not less than
660 feet from the unit boundaries, and not less than 330 feet from the treated interval of any horizontal or vertical well
drilled in the Fruitland Coal
Seams Formation, unless
the Director grants an exception.
3.
The
horizontal wells may be drilled from a location anywhere on the Application Lands, or upon adjacent lands
with landowner consent, unless the Director grants an exception.
IT IS FURTHER ORDERED:
1.
The
provisions contained in the above order shall become effective immediately.
2.
The
Commission expressly reserves the 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 21st day of June, 2017, as of June 12,
2017.
OIL AND GAS CONSERVATION COMMISSION
OF THE STATE OF COLORADO
By__________________________________
Peter Gowen, Acting Secretary