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 NO. 191
ORDER NO. 191-85
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REPORT OF COMMISSION
This cause came on for hearing before the Commission on April 4, 2011, in Suite 801, The Chancery Building, 1120 Lincoln Street, Denver, Colorado, for an order to establish an approximate 625-acre drilling and spacing unit for certain lands located in Townships 5 and 6 South, Ranges 91 and 92, West, 6th P.M., and approve of up to 16 wells within said unit, for the production of gas and associated hydrocarbons from the Williams Fork and Iles Formations.
FINDINGS
The Commission finds as follows:
1. Antero Resources Piceance Corporation (“Antero” or “Applicant”), 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 pursuant to the Oil and Gas Conservation Act.
4. Rule 318.a. of the Rules and Regulations of the Oil and Gas Conservation Commission requires that wells drilled in excess of 2,500 feet in depth be located not less than 600 feet from any lease line, and located not less than 1,200 feet from any other producible or drilling oil or gas well when drilling to the same common source of supply. Certain lands in Townships 5 and 6 South, Ranges 91 and 92, West, 6th P.M. are subject to this Rule for the Williams Fork and Iles Formations.
5. On October 8, 2010, Antero, by its attorneys, filed with the Commission a verified application for an order to establish an approximate 625-acre drilling and spacing unit for the below-listed lands, and authorize the equivalent of one well per 10 acres well density, for the production of gas and associated hydrocarbons from the Williams Fork and Iles Formations:
Section 33: SE¼, E½ SW¼, and E½ W½ SW¼
Section 6: NW¼
Section 1: NE¼
All future Williams Fork Formation and Iles Formation wells to be drilled upon under this application should be located downhole anywhere upon the application lands but no closer than 100 feet from the unit boundaries without exception being granted by the Director of the Commission. It is provided however that in cases where the 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 Williams Fork and Iles Formation wells, the well should be located downhole no closer than 200 feet from the unit boundaries so abutting or cornering such lands without exception being granted by the Director of the Commission.
That, except as previously authorized by order of the Commission, wells to be drilled under this order should be drilled from the surface either vertically or directionally from no more than one pad located on a given quarter-quarter section (or lots or parcels approximately equivalent thereto) and that Iles Formation wells should be drilled and completed only in association with the drilling and completing of wells in the Williams Fork Formation, unless exception is granted by the Commission pursuant to application made for such exception.
6. On December 22, 2010, Garfield County, by its attorney, filed a written letter with the Commission to intervene.
7. On January 5, 2011, a prehearing conference was held, and in conjunction with the prehearing conference, a prehearing conference was held on Docket No. 1010-SP-37.
8. On January 26, 2011, Antero, by its attorneys, filed a written request with the Commission to continue this matter to the April hearing; consequently, the matter was continued.
9. On February 16, 2011, Antero, by its attorneys, filed with the Commission a verified amended application (the “Amended Application”), for an order to establish an approximate 625-acre drilling and spacing unit for the below-listed lands (the “Application Lands”), for the production of gas and associated hydrocarbons from the Williams Fork and Iles Formations:
Section 33: SE¼, E½ SW¼, and E½ W½ SW¼
Section 6: NW¼
Section 1: NE¼
Antero requested that as to the Application Lands, the Commission should permit no more than four well pads, and, at Antero’s option, up to 16 wells, with no more than one downhole well location in any quarter-quarter section of said unit, for the production of gas and associated hydrocarbons from the Williams Fork and Iles Formations. In addition, no such wells should be located downhole any closer than 100 feet from the boundary of the unit unless such boundary 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 Williams Fork wells in which event Williams Fork Formation and Iles Formation wells to be drilled upon the unit should be drilled downhole no closer than 200 feet from that portion of the unit boundary which so abuts or corners the lands in respect of which 10-acre density downhole drilling for Williams Fork Formation wells has not been ordered by the Commission.
Further, each Oil and Gas Location Assessment (“OGLA”), Form 2A, submitted for a well pad under the Amended Application should incorporate, as may be appropriate, conditions of approval similar to those appended to the approved OGLA, Form 2A, for the Fenno Ranch “A” Well Pad located within the unit established in Cause No. 191, Docket No. 1010-SP-37, and no well should be drilled any closer than 500 feet to an occupied residential structure. That wells drilled to the Iles Formation should be undertaken only in conjunction with wells drilled to the Williams Fork Formation.
10. On February 16, 2011, Garfield County, by its attorney, filed a written letter with the Commission withdrawing its intervention.
11. On March 22, 2011, Antero, by its attorney, filed with the Commission a written request to approve the Amended Application based on the merits of the verified Amended Application and the supporting exhibits as is provided for by Rule 511. Sworn written testimony and exhibits were submitted in support of the Amended Application.
12. Testimony and exhibits submitted in support of the Amended Application by Brian Wade, Landman for Antero, showed that multiple wells have been drilled, tested and completed in the Williams Fork and Iles Formations upon lands in the vicinity of the Application Lands. Further testimony showed that lands in the vicinity of the Application Lands have been approved for 10-acre density development for the production of gas and associated hydrocarbons from the Williams Fork Formation and Iles Formation for both 160-acre and 320-acre drilling and spacing units. The Application Lands are located within Antero’s Rifle-Silt Wildlife Mitigation Plan area; thus, Antero and the Division of Wildlife have pre-consulted and have agreed to ways the operator can avoid, minimize, and mitigate impacts to wildlife resources.
13. The above-referenced testimony and exhibits show that granting the Amended Application will allow more efficient reservoir drainage, will prevent waste, will assure a greater ultimate recovery of gas, and will not violate correlative rights.
14. Antero 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 Amended Application under Rule 511., the Commission should enter an order establishing an approximate 625-acre drilling and spacing unit for certain lands located in Townships 5 and 6 South, Ranges 91 and 92, West, 6th P.M., and approve of up to 16 wells within said unit, for the production of gas and associated hydrocarbons from the Williams Fork and Iles Formations.
ORDER
NOW, THEREFORE IT IS ORDERED, that an approximate 625-acre drilling and spacing unit is hereby established for the below-listed lands, for the production of gas and associated hydrocarbons from the Williams Fork and Iles Formations:
Section 33: SE¼, E½ SW¼, and E½ W½ SW¼
Section 6: NW¼
Section 1: NE¼
IT IS FURTHER ORDERED, that no more than four well pads shall be permitted upon the Application Lands, and at Antero’s option, up to 16 wells may be drilled, with no more than one downhole well location in any quarter-quarter section of said unit, for the production of gas and associated hydrocarbons from the Williams Fork and Iles Formations.
IT IS FURTHER ORDERED, that the permitted wells shall be located downhole no closer than 100 feet from the boundary of the unit unless such boundary 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 Williams Fork wells in which event Williams Fork Formation and Iles Formation wells to be drilled upon the unit shall be drilled downhole no closer than 200 feet from that portion of the unit boundary which so abuts or corners the lands in respect of which 10-acre density downhole drilling for Williams Fork Formation wells has not been ordered by the Commission.
IT IS FURTHER ORDERED, that each OGLA, Form 2A, submitted for a well pad on the Application Lands shall incorporate, as may be appropriate, conditions of approval similar to those appended to the approved OGLA, Form 2A, for the Fenno Ranch “A” Well Pad located within the unit established in Cause No. 191, Docket No. 1010-SP-37, and no well shall be drilled any closer than 500 feet to an occupied residential structure.
IT IS FURTHER ORDERED, that wells drilled to the Iles Formation shall be undertaken only in conjunction with wells drilled to the Williams Fork Formation.
IT IS FURTHER ORDERED, that the provisions contained in the above order shall become effective immediately.
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 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 15th day of April, 2011, as of April 4, 2011.
OIL AND GAS CONSERVATION COMMISSION
OF THE STATE OF COLORADO
By____________________________________
Robert A. Willis, Acting Secretary
Dated at Suite 801
1120 Lincoln Street
Denver, Colorado 80203
April 15, 2011