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BEFORE THE OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO
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IN THE MATTER THE PROMULGATION AND ESTABLISHMENT OF FIELD RULES TO GOVERN OPERATIONS IN THE HIAWATHA WEST FIELD, MOFFAT COUNTY, COLORADO |
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CAUSE NO. 133
ORDER NO. 133-22 |
REPORT OF THE COMMISSION
This cause came on for hearing before the Commission at 10:00 a.m. on August 18, 2003, in the Petroleum Hall at the Green Center, Colorado School of Mines, 1500 Illinois Street, Golden, Colorado for an order to allow up to eight (8) wells to be drilled on certain 320-acre drilling and spacing units for the below-listed lands, for production of oil and associated hydrocarbons from the Wasatch, Fort Union/Lance/Lewis, and Mesaverde Formations.
FINDINGS
The Commission finds as follows:
1. Ensign Operating Company (“Ensign”) as applicant herein, 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.
4. On June 23, 1959, the Commission issued Order No. 133-1 establishing 320-acre drilling and spacing units for the production of gas and associated hydrocarbons from the Wasatch, Fort Union/Lance/Lewis and Mesaverde Formations for the below-listed lands, with the permitted well to be located no closer than 660 feet from the boundaries of the drilling unit and the wells previously drilled and capable of producing shall be the permitted wells for the units on which they are located:
Township 12 North, Range 100 West, 6th P.M.
Section 17: Lots 3 through 6
Section 18: Lots 5 through 12
Section 19: All
Section 20: W½
Section 29: NW¼
Section 30: All
Township 12 North, Range 101 West, 6th P.M.
Sections 13 and 14: Lots 1 through 8
Section 15: Lots 1, 2, 7, and 8
Section 22: E½
Sections 23 through 26: All
Section 27: E½
Section 34: NE¼
Sections 35 and 36: N½
5. Subsequent orders issued by the Commission allowed additional wells, including up to four (4) wells to be drilled on certain 320-acre units for the production of gas and associated hydrocarbons from the Wasatch, Fort Union/Lance/Lewis, and Mesaverde Formations.
6. On June 30, 2003, Ensign, by its attorney, filed with the Commission a verified application for an order to allow up to eight (8) wells to be drilled on the 320-acre drilling and spacing units for the below-listed lands, for production of oil and associated hydrocarbons from the Wasatch, Fort Union/Lance/Lewis, and Mesaverde Formations, with the additional wells being optional wells to be drilled and completed at the discretion of the Operator, and with any new wells located no closer than 600 feet from the unit boundaries:
Township 12 North, Range 101 West, 6th P.M.
Section 26: All
Section 36: N½
7. Testimony and exhibits presented at the administrative hearing showed that Ensign has over 90% of the working interest ownership in the application lands for depths from the surface to 100 feet below the stratigraphic equivalent of 4719 feet. Additional testimony showed that the topography in the area is rough, the land is very dry with sparse vegetation and no population is present.
8. Testimony and exhibits presented at the administrative hearing showed a structural high to the northeast of the application area on the Hiawatha Anticline and the discontinuity of the numerous productive sands in the application area.
9. Testimony and exhibits presented at the administrative hearing showed that 85% of the historic production comes from the Lewis Formation. Additional testimony showed that the Lewis Formation is depleted and the Lance Formation is partially depleted. Further testimony showed that the Wasatch Formation sands are the primary target for the increased density wells requested in the application.
10. Testimony and exhibits presented at the administrative hearing showed that incremental reserves recovered from previous increased well density resulted in a production increase of 215%. Additional testimony showed that the existing wells in the three (3) 320-acre drilling and spacing units are not effectively draining the units and the drilling of additional wells would be economic.
11. Additional wells are necessary to efficiently and economically drain the 320-acre drilling and spacing units in the application area while preventing waste and protecting correlative rights.
12. At the time of the administrative hearing, Ensign Operating Company agreed to be bound by oral order of the Commission.
13. Based on the facts stated in the verified application, having received no protests and having been heard by the Hearing Officer who recommends approval, the Commission should enter an order to allow up to eight (8) wells to be drilled and completed for the production of gas and associated hydrocarbons from the Wasatch, Fort Union-Lance-Lewis and Mesaverde Formations, on the 320-acre drilling and spacing units described above in Finding No. 6.
ORDER
NOW, THEREFORE IT IS ORDERED, that Order No. 133-21 is hereby amended to allow up to eight (8) wells to be drilled and completed for the production of gas and associated hydrocarbons from the Wasatch, Fort Union-Lance-Lewis and Mesaverde Formations, on the 320-acre drilling and spacing units described below, with the additional wells being optional wells to be drilled and completed at the discretion of the Operator, and with any new wells located no closer than 600 feet from the unit boundaries:
Township 12 North, Range 101 West, 6th P.M.
Section 26: All
Section 36: N½
IT IS FURTHER ORDERED that the provisions contained in the above order shall become effective forthwith.
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.
ENTERED this day of August 2003, as of August 18, 2003.
OIL AND GAS CONSERVATION COMMISSION
OF THE STATE OF COLORADO
By
Patricia C. Beaver, Secretary
Dated at Suite 801
1120 Lincoln Street
Denver, Colorado 80203