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 WILLIAMS FORK FORMATION, RULISON FIELD, GARFIELD COUNTY, COLORADO

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CAUSE NO. 139

 

DOCKET NO. 170700413

 

TYPE:  SPACING

 

ORDER NO. 139-125

 

 

REPORT OF THE COMMISSION

 

            The Commission heard this matter on July 24, 2017, at the Colorado Oil and Gas Conservation Commission, 1120 Lincoln Street, Suite 801, Denver, Colorado upon application for an order to: 1) vacate an approximate 320-acre drilling and spacing unit established by Order No. 139-123 for portions of Section 8, Township 7 South, Range 93 West, 6th P.M., for the production of oil, gas, and associated hydrocarbons from the Williams Fork Formation; and 2) subject the lands to the previously applicable order, Order No. 139-76.

                                                                                              

FINDINGS

 

The Commission finds as follows:

 

1.         TEP Rocky Mountain LLC (Operator No. 98650) (“TEP” 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.

 

4.         On July 23, 2007, the Commission entered Order No. 139-76 which approved the equivalent of one well per ten acres for certain lands, including the E˝ of Section 8, Township 7 South, Range 93 West, 6th P.M., for the production of gas and associated hydrocarbons from the Williams Fork Formation, permitting any Williams Fork wells to be located downhole anywhere upon the lands but no closer than 100 feet from a lease line or unit boundary, unless the lease line or unit boundary abuts or corners land which have not been approved for 10-acre density drilling of the Williams Fork Formation, in which event the permitted well will be located no closer than 200 feet from the lease line or unit boundary, with a surface location either vertically or directionally from no more than one well pad quarter-quarter section (or lots or parcels approximately equivalent thereto).

 

5.         On October 26, 2015, the Commission entered Order No. 139-123 which established an approximate 320-acre drilling and spacing unit for the E˝ of Section 8, Township 7 South, Range 93 West, 6th P.M., and maintained the existing well density equivalent of one well per 10 acres within the drilling and spacing unit, for the production of gas and associated hydrocarbons from the Williams Fork Formation.

 

6.         On May 5, 2017, TEP, by its attorneys, filed with the Commission a verified application (“Application”) pursuant to §34-60-116, C.R.S., for an order to: 1) vacate an approximate 320-acre drilling and spacing unit established by Order No. 139-123 for (“Application Lands”) for the production of oil, gas, and associated hydrocarbons from the Williams Fork Formation; and 2) subject the lands to the previously applicable order, Order No. 139-76:

 

Township 7 South, Range 93 West, 6th P.M.

Section 8:        E˝

 

7.         On June 29, 2017, TEP, 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.

 

            8.         Land testimony and exhibits submitted in support of the Application by Mark Stoltz, Landman for TEP, showed that TEP holds oil and gas leasehold interests and has a right to drill in the Application Lands.  Land testimony further showed that the 320-acre drilling and spacing unit previously established for the Application Lands by Order No. 139-123 for the production of oil, gas, and associated hydrocarbons from the Williams Fork Formation is no longer necessary because the 320-acre drilling and spacing unit was created solely for the purpose of force pooling certain non-consenting owners, but no pooling order was ever entered.  Land testimony further showed that the prior order, Order No. 139-76, should be reinstated for the Application Lands for the production of oil, gas, and associated hydrocarbons from the Williams Fork Formation.

 

9.         TEP requested that the Commission take administrative notice of the testimony and exhibits submitted in support of Order No. 139-76 and Order No. 139-123 by Marsha Satorius-Fox, Operations Geoscientist for Williams Production RMT Company, which showed that the nature of the depositional environment and rock properties of the Williams Fork Formation, including the discontinuous nature of the point-bar sand reservoirs, justifies 10-acre well density. The Commission takes administrative notice of such fact.

 

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.       TEP 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: 1) vacate an approximate 320-acre drilling and spacing unit established by Order No. 139-123 for portions of Section 8, Township 7 South, Range 93 West, 6th P.M., for the production of oil, gas, and associated hydrocarbons from the Williams Fork Formation; and 2) subject the lands to the previously applicable order, Order No. 139-76.

 

 

 

ORDER

 

IT IS HEREBY ORDERED:

 

1.         Order No. 139-123 and an approximate 320-acre drilling and spacing unit for the below-described lands established by Order No. 139-123, for the production of oil, gas and associated hydrocarbons from the Williams Fork Formation, are hereby vacated:

 

Township 7 South, Range 93 West, 6th P.M.

Section 8:        E˝

 

2.         The below-described lands are hereby made subject to Order No. Order No. 139-76:

 

Township 7 South, Range 93 West, 6th P.M.

Section 8:        E˝

 

 

IT IS FURTHER ORDERED:

 

1.         The provisions contained in the above order shall become effective immediately.

 

2.         The Commission expressly reserves its 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 7th day of August, 2017, as of July 24, 2017.         

 

                                                                        OIL AND GAS CONSERVATION COMMISSION

                                                                        OF THE STATE OF COLORADO

 

 

                                                                        By__________________________________

James P. Rouse, Acting Secretary