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BEFORE THE OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO
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IN THE MATTER OF THE PROMULGATION AND ESTABLISHMENT OF FIELD RULES TO GOVERN OPERATIONS IN THE PLATEAU FIELD, MESA COUNTY, COLORADO |
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CAUSE NO. 166
ORDER NO. 166-24 |
REPORT OF THE COMMISSION
This cause came on for hearing before the Commission at 9:00 a.m. on November 27, 2006 in Suite 801, the Chancery Building, 1120 Lincoln Street, Denver, Colorado, for an order to allow the equivalent of one (1) well per ten (10) acres for the production of gas from the Mesaverde Formation underlying certain lands in Township 10 South, Ranges 94 and 95 West, 6th P.M.
FINDINGS
The Commission finds as follows:
1. Laramie Energy, LLC (“Laramie”), 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 respect 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 April 20, 1981, the Commission issued Order No. 166-15, which among other things, established 640-acre drilling and spacing units and 160-acre drilling and spacing units for production of gas from the Mesaverde Formation (including the Cozzette-Corcoran Sandstones), for certain lands including Township 10 South, Ranges 94 and 95 West 6th P.M.
5. On June 5, 2006, the Commission issued Order No. 166-23, which among other things, allowed the equivalent of one (1) well per ten (10) acres to be optionally drilled in each 160-acre drilling and spacing unit, for the production of gas from the Mesaverde Formation, with the permitted well to be located no closer than one hundred (100) feet from the boundary of the unit or lease line (if unspaced), without exception granted by the Director for certain lands including some lands in Township 10 South, Ranges 94 and 95 West, 6th P.M.
6. On September 6, 2006, Laramie Energy, LLC, by its attorney, filed with the Commission a verified application for an order to allow the equivalent of one (1) well per ten (10) acres, for the production of gas from the Mesaverde Formation (including the Cozzette-Corcoran Sandstones), with the permitted well to be located no closer than one hundred (100) feet from the lease line, without exception granted by the Director. In cases where the application lands abut or corner lands where the Commission has not, at the time of the drilling permit application, granted the right to drill 10-acre density Mesaverde Formation wells, the well should be located downhole no closer than two hundred (200) feet from the boundary or boundaries of the drilling unit abutting or cornering such lands, without exception granted by the Director, for the below-listed lands:
Section 24: SE¼ SE¼
10. Laramie has reviewed and evaluated the existing reservoir pressure data and believes the same supports increased density. Further, Laramie intends to continue to study and monitor the same in accordance with good engineering practices.
12. Laramie Energy, LLC 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 recommended approval, the Commission should enter an order to allow the equivalent of one (1) well per ten (10) acres for the production of gas from the Mesaverde Formation underlying certain lands in Township 10 South, Ranges 94 and 95 West, 6th P.M.
ORDER
NOW, THEREFORE, IT IS ORDERED, that the equivalent of one (1) well per ten (10) acres is hereby approved to be optionally drilled for the production of gas from the Mesaverde Formation (including the Cozzette-Corcoran Sandstones), for the below-described lands:
IT IS FURTHER ORDERED, that the permitted well shall be located downhole no closer than 100 feet from lease lines without exception granted by the Director. In cases where the lands abut or corner lands where the Commission has not, at the time of the drilling permit application, granted the right to drill ten (10) acre density Mesaverde Formation wells, the well shall be located downhole no closer than two hundred (200) feet from lease lines abutting or cornering such lands without exception granted by the Director.
IT IS FURTHER ORDERED, that no more than four (4) Mesaverde Formation wells shall be drilled on the lands per governmental quarter quarter section, and that the wells shall be drilled from the surface either vertically or directionally from no more than one (1) pad located on any quarter quarter section unless exception is granted by the Director.
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.
IT IS FURTHER ORDERED, that under the State Administrative Procedure Act, the Commission considers this order to be final agency action for purposes of judicial review within thirty (30) days after the date this order is mailed by the Commission.
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
December 11, 2006