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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 MAMM CREEK FIELD, GARFIELD COUNTY, COLORADO |
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CAUSE NOS. 191 and 510
ORDER NOS. 191-45 and 510-33 |
REPORT OF THE COMMISSION
This cause came on for hearing before the Commission at 9:00 a.m. on February 12, 2007, in Suite 801, in The Chancery Building, 1120 Lincoln Street, Denver, Colorado, for an order establishing an approximate 130.805 acre [sic] drilling and spacing unit for the production of gas and associated hydrocarbons from the Williams Fork and Iles Formations for lands in N½ of Section 8 in Township 6 South, Range 95 West, 6th P.M. and to allow the equivalent of one well per ten acres to be drilled and produced on said unit.
FINDINGS
The Commission finds as follows:
1. Antero Resources Corporation, now renamed Antero Resources Piceance Corporation ("Antero"), 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. Rule 318.a. of the Rules and Regulations of the Commission requires that wells drilled in excess of two thousand five hundred (2,500) feet in depth be located not less than six hundred (600) feet from any lease line, and located not less than one thousand two hundred (1,200) feet from any other producible or drilling oil or gas well when drilling to the same common source of supply. Portions of Section 8, Township 6 South, Range 92 West, 6th P.M. are subject to this rule.
5. On October 31, 2005, the Commission issued Order No. 510-16, which among other things, allowed the equivalent of one (1) well per 10 acres to be drilled on certain lands including portions of Section 8, Township 6 South, Range 92 West, 6th P.M., for the production of gas and associated hydrocarbons from the Williams Fork Formation of the Mesaverde Group, with the permitted well to be located no closer than 100 feet from the outside boundary.
6. On June 5, 2006, the Commission issued Order No. 191-25, which among other things, allowed the equivalent of one (1) well per 10 acres to be drilled on certain lands including portions of Section 8, Township 6 South, Range 92 West, 6th P.M., for the production of gas and associated hydrocarbons from the Iles Formation of the Mesaverde Group.
7. On September 18, 2006, the Commission issued Order No. 191-34, which among other things, allowed the equivalent of one (1) well per 10 acres to be drilled in the S½ SW¼ of Section 8, Township 6 South, Range 92 West, 6th. [sic] P.M., for the production of gas and associated hydrocarbons from the Williams Fork and Iles Formations of the Mesaverde Group. All wells will be drilled from the surface, either vertically or directionally, from no more than one pad located on a given quarter quarter [sic] section unless exception is granted by the Colorado Oil and Gas Conservation Commission pursuant to application made for such exception.
8. On November 16, 2006, Antero, by its attorney, filed with the Commission a verified application for an order to allow the equivalent of one (1) well per 10 acres, for certain lands in the N½ of Section 8, Township 6 South, Range 92 West, 6th P.M. for production of gas and associated hydrocarbons from the Williams Fork and Iles Formations. Said wells will be drilled from the surface either vertically or directionally from no more than one (1) pad located on a given quarter quarter section, unless exception is granted by the Colorado Oil and Gas Conservation Commission.
9. On December 27, 2006, Antero, by its attorney, filed with the Commission a written request to continue this matter to the February hearing, and the hearing in this matter was continued.
10. On January 5, 2007, Antero, by its attorney, amended its application for an order to establish an approximate 130.805 acre [sic] drilling and spacing unit and allow the equivalent of one (1) well per 10 acres, for the below-described lands for production of gas and associated hydrocarbons from the Williams Fork and Iles Formations. Said wells will be drilled from the surface either vertically or directionally from no more than one (1) pad located on a given quarter quarter [sic] section, unless exception is granted by the Colorado Oil and Gas Conservation Commission.
All that part of Section 8, Township 6 South, Range 92 West, 6th P.M., lying in the N½ of said Section 8 more particularly described as follows:
Beginning at the Northwestern corner of Section 8; thence South 01°03’ West a distance of 811.7 feet to a point South of the Colorado River Meander Land; thence continuing along said Meander Land following twenty-five (25) courses:
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North 67°05’ East a distance of 679.3 feet |
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North 76°22’ East a distance of 141.3 feet |
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South 78°14’ East a distance of 102 feet |
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North 71°34’ East a distance of 52.6 feet |
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South 86°40’ East a distance of 429.2 feet |
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South 55°59’ East a distance of 200.8 feet |
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South 85°26’ East a distance of 104.3 feet |
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North 87°43’ East a distance of 104.1 feet |
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South 43°29’ East a distance of 894.6 feet |
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North 77°28’ West a distance of 76.70 feet |
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South 65°55’ East a distance of 464.9 feet |
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South 75°57’36" East a distance of 169.2 feet |
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South 76°37’ East a distance of 185.8 feet |
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South 72°55’ East a distance of 200.8 feet |
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South 86°05’ East a distance of 159.1 feet |
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South 87°46’ East a distance of 246.5 feet |
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North 83°00’ East a distance of 157.1 feet |
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North 82°23’ East a distance of 121.5 feet |
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North 75°19’ East a distance of 342.4 feet |
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North 72°45’36" East a distance of 249.2 feet |
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North 54°41’24" East a distance of 241.4 feet |
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North 71°24’ East a distance of 153.1 feet |
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North 70°51’ East a distance of 188.6 feet |
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North 73°36’36" East a distance of 290.9 feet |
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North 69°44’ East a distance of 23.4 feet |
Thence leaving said Meander Land North 00°43’12" East along the Easterly line of Section 8 a distance of 1001 feet; thence North 88°47’59" West along the Northerly line of Section 8 a distance of 5291.7 feet to the point of beginning.
All future Williams Fork Formation wells should be located downhole anywhere upon such lands but no closer than 100 feet from the outside boundary of the drilling and spacing unit unless such unit abuts or corners lands in respect of which the Commission has not at the time of the drilling permit application granted the right to drill 10-acre density downhole drilling for the Williams Fork Formation, in which event the Williams Fork Formation wells to be drilled upon the application lands should be drilled downhole no closer than 200 feet from the portion of the boundary which so abuts or corners the lands in respect of which 10-acre density downhole drilling for the Williams Fork Formation wells has not been ordered by the Commission. All future Iles Formation wells should be located downhole anywhere upon such lands but no closer than 100 feet from the boundaries of the unit unless such unit abuts or corners lands in respect of which the Commission has not at the time of drilling permit application granted the right to drill 10-acre density Iles Formation wells, in which event Iles Formation wells to be drilled upon the application lands should be drilled downhole no closer than 400 feet from the portion of the boundary which so abuts or corners the lands in respect of which 10-acre density downhole drilling for the Iles Formation wells has not been ordered by the Commission.
11. On January 19, 2007, Antero, by its attorney, 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. Such request also requested that the Commission take notice of the evidence (including pressure data evidence) supporting the Commission’s Order Nos. 191-25, 191-36 and 510-16 as the lands covered by the applications in these orders is located in the same general vicinity as the application lands.
12. Testimony and exhibits submitted in support of the application indicated that a drilling and spacing unit is necessary due to the numerous leases and unleased mineral ownership within the application lands and that establishing the unit would allow downhole well locations to be more efficiently placed thus assuring the greatest ultimate recovery of gas and associated hydrocarbon substances. The testimony and evidence supporting the referenced prior orders of the Commission show that the proposed ten (10) acre well density will allow more efficient reservoir drainage, will prevent waste, will assure a greater ultimate recovery of gas and will not violate correlative rights.
13. No protests to the application have been filed with the Commission or the applicant.
14. Antero Resources Piceance Corporation agreed to be bound by oral order of the Commission.
15. 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.b., the Commission should enter an order to establish an approximate 130.805 acre [sic] drilling unit as described above for the production of gas and associated hydrocarbons from the Williams Fork and Iles Formations and to allow the equivalent of one well per 10-acres on said unit.
ORDER
NOW, THEREFORE, IT IS ORDERED, that an approximate 130.805-acre drilling and spacing unit consisting of the lands described below within Section 8, Township 6 South, Range 92 West, 6th P.M. is hereby established for the production of gas from the Williams Fork Formation and Iles Formation of the Mesaverde Group, allowing the equivalent of one well per 10 acres to be drilled on said unit:
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Township 6 South, Range 92 West, 6th P.M. |
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Section 8: |
All that part of Section 8, Township 6 South, Range 92 West, 6th P. M., lying in the N½ of said Section 8 more particularly described as follows: |
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Beginning at the Northwestern corner of Section 8; thence South 01°03’ West a distance of 811.7 feet to a point South of the Colorado River Meander Land; thence continuing along said Meander Land following twenty-five (25) courses: |
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North 67°05’ East a distance of 679.3 feet |
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North 76°22’ East a distance of 141.3 feet |
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South 78°14’ East a distance of 102 feet |
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North 71°34’ East a distance of 52.6 feet |
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South 86°40’ East a distance of 429.2 feet |
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South 55°59’ East a distance of 200.8 feet |
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South 85°26’ East a distance of 104.3 feet |
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North 87°43’ East a distance of 104.1 feet |
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South 43°29’ East a distance of 894.6 feet |
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North 77°28’ West a distance of 76.70 feet |
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South 65°55’ East a distance of 464.9 feet |
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South 75°57’36" East a distance of 169.2 feet |
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South 76°37’ East a distance of 185.8 feet |
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South 72°55’ East a distance of 200.8 feet |
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South 86°05’ East a distance of 159.1 feet |
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South 87°46’ East a distance of 246.5 feet |
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North 83°00’ East a distance of 157.1 feet |
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North 82°23’ East a distance of 121.5 feet |
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North 75°19’ East a distance of 342.4 feet |
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North 72°45’36" East a distance of 249.2 feet |
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North 54°41’24" East a distance of 241.4 feet |
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North 71°24’ East a distance of 153.1 feet |
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North 70°51’ East a distance of 188.6 feet |
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North 73°36’36" East a distance of 290.9 feet |
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North 69°44’ East a distance of 23.4 feet |
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Thence leaving said Meander Land North 00°43’12" East along the Easterly line of Section 8 a distance of 1001 feet; thence North 88°47’59" West along the Northerly line of Section 8 a distance of 5291.7 feet to the point of beginning. |
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IT IS FURTHER ORDERED, that all future Williams Fork Formation wells shall be located downhole no closer than 100 feet from the boundaries of the unit unless such unit abuts or corners lands in respect of which the Commission has not at the time of drilling permit application granted the right to drill Williams Fork Formation 10-acre density wells, in which event the wells shall be drilled downhole no closer than 200 feet from the unit which so abuts or corners the lands in respect of which 10-acre density downhole drilling for the Williams Fork Formation wells has not been ordered by the Commission.
IT IS FURTHER ORDERED, that all future Iles Formation wells shall be located downhole anywhere in the drilling and spacing unit but no closer than 100 feet from the boundaries of the unit without exception being granted by the Director of the Oil and Gas Conservation Commission. It is provided however that in cases where the application lands abut or corner lands in respect of which the Commission has not at the time of drilling permit application granted the right to drill 10-acre density Iles Formation wells, the well shall be located downhole no closer than 400 feet from the boundary or boundaries of the drilling unit so abutting or cornering such lands without exception being granted by the Director of the Oil and Gas Conservation Commission.
IT IS FURTHER ORDERED, that wells drilled on the application lands shall be drilled from the surface either vertically or directionally from no more than one pad located on a given quarter quarter [sic] section unless exception is granted by the Colorado Oil and Gas Conservation Commission.
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.
IT IS FURTHER ORDERED, that an application for reconsideration by the Commission of this order is not required prior to the filing for judicial review.
ENTERED this 20th day of February, 2007, as of February 12, 2007.
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OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO
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By |
Patricia C. Beaver, Secretary |
Dated at Suite 801
1120 Lincoln Street
Denver, Colorado 80203
February 20, 2007