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 IGNACIO-BLANCO FIELD [sic] LA PLATA AND ARCHULETA COUNTIES, COLORADO

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CAUSE NO. 112

 

ORDER NO. 112-60

 

REPORT OF THE COMMISSION

 

This cause came on for hearing before the Commission on June 17, 1988 at 9:00 a.m. in Hearing Room A, Legislative Services Building, 200 East 14th Street, Denver, Colorado, after giving Notice of Hearing as required by law, on the Commission's own motion to consider measures to establish separate drilling and spacing units for the production of methane gas from the Fruitland coal seams and establish such rules as needed for the production of methane gas in an economic and efficient manner, and to protect the health, safety and welfare of the general public in certain lands in Archuleta and La Plata Counties, Colorado.

 

FINDINGS

 

The Commission finds as follows:

 

1.      Due notice of the time, place and purpose of the hearing has been given in all respects as required by law.

 

2.      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 affecting all lands other than those owned by Indians.

 

3.      In Cause 112 the Commission has determined that the Fruitland-Pictured Cliffs formations were sources of supply for the production of gas and associated hydrocarbons.  Order No. 112-6, among other things, established 320-acre drilling and spacing units with one well per unit.  There are seams of coal within the Fruitland formation comprised of various non-homogeneous, overlapping, interconnecting lenticular coals of low permeability which are potentially productive of natural gas which is predominantly methane.

 

4.      Evidence presented at the hearing indicates that the gas produced from the Fruitland coal seams has different chemical characteristics from gas produced from within the Fruitland sandstone or the Pictured Cliffs sandstone and should be considered a separate source of supply.

 

5.      The Fruitland coal seams should be defined to include all coal seams within the equivalent of the stratigraphic interval from the top of the Fruitland Sand to the lowermost coal as shown on the Lithodensity-Compensated Neutron Log dated June 2, 1986 run on the Cugnini Gas Unit "A" No. 1, located in the NW1/4 Section 26, Township 34 North, Range 9 West, N.M.P.M., La Plata County, Colorado which log shows the top of the Fruitland Sand at a depth of 2528 feet and the base of the lowermost coal at a depth of 2962 feet.

 

6.      Drilling and spacing units of 320-acres should be established for the production of methane gas from the Fruitland coal seams.  The units should consist of the N1/2 and S1/2 or the E1/2 and W1/2 of a full section with the permitted well located, when north of the north line of Township 32 North, in the NW1/4 and SE1/4 of the section, and when south of the north line of Township 32 North, in the NE1/4 and SW1/4 of the section, and located no closer than 990 feet to any outer boundary of the unit, nor closer than 130 feet to any interior quarter section line.

 

7.      The Director should be allowed to grant exceptions to permitted well locations as described in Finding 6 herein, without of hearing, to avoid topographical or surface hazards.  If for any reason, exceptions may be granted provided the owners of the contiguous and cornering units toward which the proposed location would moved, file a waiver or consent, in writing, agreeing to said exception.

 

8.      Order No. 112-1, Rule 2b and subsequent Orders established drilling units in the cases of fractional sections in 32 North, Ranges 6, 7, 8, 9, 10 and 11 West of the New Mexico Principal Meridian lying immediately adjacent to the Colorado - New Mexico state boundary and such unit as described in the above Order be established for the production of methane gas from the coal seams.

 

9.      Matters pertaining to any infill drilling, specific production practices, non-standard size units, horizontal drilling and other matters unique to the production of methane from the Fruitland seams should be taken under advisement by the Commission, and testimony be presented at the August 1988 hearing of the Commission, upon proper notice being given. The Rules and Regulations of Commission should govern these matters until any subsequent orders be issued.

 

ORDER

 

NOW, THEREFORE, IT IS ORDERED, adopted and not in conflict herewith:

 

Rule 1.    The Fruitland coal seams shall be defined to all coal seams within the equivalent of the stratigraphic from the top of Fruitland sand to the lowermost coal as shown on Lithodensity-Compensated Neutron Log dated June 2, 1986 run on the Gas Unit "A" No. 1, located in the NW1/4 Section 26, Township 34 Range 9 West, N.M.P.M., La Plata County, Colorado and which log the top of the Fruitland sand at a depth of 2528 feet and the base the lowermost coal at a depth of 2962 feet.

 

Rule 2.    Three Hundred Twenty (320) acre drilling and units shall be and the same are hereby established for the production of gas from the Fruitland coal seams, common source of supply underlying the following described lands in La Plata and Archuleta Colorado:

 

Township 32 North (South of Ute Line)

 

 

 

 

Range

1 West:

Sections 1-24

 

Range

1 1/2 West:

Sections 1, 12, 13, 24

 

Range

2 West:

Sections 1-24

 

Range

3 West:

Sections 1-24

 

Range

4 West:

Sections 1-24

 

Range

5 West:

Sections 1-24

 

Range

6 West:

Sections 1-24

 

Range

7 West:

Sections 1-24

 

Range

8 West:

Sections 1-24

 

Range

9 West:

Sections 1-24

 

Range

10 West:

Sections 1-24

 

Range

11 West:

Sections 1-24

 

 

 

 

 

Township 33 North (South of Ute Line)

 

 

 

 

 

Range

2 West:

All Sections

 

Range

3 West:

All Sections

 

Range

4 West:

All Sections

 

Range

5 West:

All Sections

 

Range

6 West:

All Sections

 

Range

7 West:

All Sections

 

Range

8 West:

All Sections

 

Range

9 West:

All Sections

 

Range

10 West:

All Sections

 

Range

11 West:

Sections 1, 2, 9-36

 

 

 

 

 

Township 34 North (South of Ute Line)

 

 

 

 

 

Range

4 West:

Sections 1U – 18U, 19-36

 

Range

5 West:

Sections 1U – 18U, 19-36

 

Range

6 West:

Sections 3U – 10U, 15U – 18U, All Unsurveyed

 

 

Lands 19-22, 27-34

 

Range

7 West:

Sections 1U – 18U, 19-36

 

Range

8 West:

Sections 1U – 18U, 19-36

 

Range

9 West:

Sections 1U – 12U, 13-36

 

Range

10 West:

Sections 1U, 11U, 12U, 13-36

 

Range

11 West:

Sections 13, 24, 25, 35, 36

 

 

 

 

 

Township 34 North (South of Ute Line)

 

 

 

 

 

Range

5 West:

Sections 1-18

 

Range

6 West:

Sections 1-18

 

Range

7 West:

Sections 1-18

 

Range

8 West:

Sections 1-18

 

Range

9 West:

Sections 1-5, 8-12

 

 

 

 

 

Township 34 1/2 North (North of Ute Line)

 

 

 

 

 

Range

9 West:

Sections 33-36

 

 

 

 

 

Township 35 North (North of Ute Line)

 

 

 

 

 

Range

5 West:

Unsurveyed Sections 19, 29-32

 

Range

6 West:

Sections 13-36

 

Range

7 West:

Sections 13, 14, 23, 24, 25, 26, 35, 36 and

 

 

 

All Unsurveyed lands

 

Range

8 West:

Sections 1, 2, 9-36

 

Range

9 West:

Sections 24-27, 34-36

 

 

The units shall consist of the N1/2 and S1/2 or the E1/2 and W1/2 of a full section with the permitted well located, when north of the north of Township 32 North, in the NW1/4 and SE1/4 of the section, and south of the north line of Township 32 North, in the NE1/4 and SW1/4 the section, and no closer than 990 feet to any outer boundary of the nor closer than 130 feet to any interior quarter section line.

 

Rule 3.    The Director may, without additional notice and hearing, grant exceptions to the above-described well locations, because of topography or surface hazards.  For other reasons, exceptions may be by the Director, providing the owners of the contiguous and cornering units toward which the proposed location would be moved, file a waiver or consent in writing, agreeing to said exceptions.

 

Rule 4.    Drilling units in the case of fractional sections established in Order No. 112-1 Rule 2b and subsequent Orders in Township 32 North, Ranges 6, 7, 8, 9, 10 and 11 West of the New Mexico Principal Meridian lying immediately adjacent to the Colorado - New Mexico state boundary shall be the units for the production of methane from the Fruitland coal seams.

 

IT IS FURTHER ORDERED, that the Rules and Regulations of Commission should govern all other matters pertaining to the production of methane gas from the Fruitland coal seams until the Commission may issue further orders upon public hearing.

 

IT IS FURTHER ORDERED, that at the regular August 1988 hearing of the Commission, upon proper notice being given, operators and interested persons shall present information and data concerning matters pertaining to infill drilling, specific production practices, horizontal drilling, and such other matters unique to the production of methane from Fruitland coal seams underlying the area as described in Rule 2 above.

 

IT IS FURTHER ORDERED, that the above order shall become forthwith.

 

ENTERED this eleventh [sic] day of July, as of June 17, 1988.

 

OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO

 

 

By 

Dennis R. Bicknell, Secretary