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. 191-95
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REPORT OF THE COMMISSION
The Commission heard this matter on August 20, 2012, at the offices of the Colorado Oil and Gas Conservation Commission, 1120 Lincoln Street, Denver, Colorado, upon application for an order to: 1) vacate an existing 332.20-acre drilling and spacing unit established by Order Nos. 191-8 and 191-10 for Section 1, Township 7 South, Range 91 West, 6th P.M.; 2) establish an approximate 292.20-acre drilling and spacing unit for Section 1, Township 7 South, Range 91 West, 6th P.M., for the production of oil, gas and associated hydrocarbons from the Iles and Williams Fork Formations of the Mesaverde Group; and 3) revert the remaining approximate 40-acre portion of the established drilling and spacing unit to unspaced lands governed by Rule 318.a.
FINDINGS
The Commission finds as follows:
1. WPX Energy Rocky Mountain, LLC (“WPX” 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. On January 10, 2005, the Commission issued Order No. 191-8 which, among other things, established 320-acre drilling and spacing units for the production of gas and associated hydrocarbons, and allow the number of wells drilled into and produced from the Williams Fork Formation to the equivalent of one well per 10 acres and drilled from one pad per quarter quarter section, with the permitted well to be located downhole no closer than 100 feet from the unit boundaries, unless such 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 Formation wells, the well shall be located downhole no closer than 200 feet from the unit boundaries of the drilling unit so abutting or cornering such lands, without exception being granted by the Director. Section 1, Township 7 South, Range 91 West, 6th P.M. is subject to Order No. 191-8 for the Williams Fork Formation of the Mesaverde Group.
5. On April 25, 2005, the Commission issued Oder No. 191-10 which, among other things, established 320-acre drilling and spacing units for the production of gas and associated hydrocarbons, and allow the number of wells drilled into and produced from the Iles Formation to the equivalent of one well per 10 acres and drilled from one pad per quarter quarter section, with the permitted well to be located downhole no closer than 100 feet from the unit boundaries, unless such 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 unit boundaries of the drilling unit so abutting or cornering such lands, without exception being granted by the Director. Section 1, Township 7 South, Range 91 West, 6th P.M. is subject to Order No. 191-10 for the Iles Formation of the Mesaverde Group.
6. On June 21, 2012, WPX, by its attorneys, filed with the Commission pursuant to § 34-60-116 C.R.S., a verified application (“Application”) for an order to: 1) vacate an existing 332.20-acre drilling and spacing unit established by Order Nos. 191-8 and 191-10 for Section 1, Township 7 South, Range 91 West, 6th P.M.; 2) establish an approximate 292.20-acre drilling and spacing unit for the below-described lands (“Application Lands”), for the production of oil, gas and associated hydrocarbons from the Iles and Williams Fork Formations of the Mesaverde Group; and 3) revert the remaining approximate 40-acre portion of the established drilling and spacing unit to unspaced lands governed by Rule 318.a.:
Township 7 South, Range 91 West, 6th P.M. (292.20-acre DSU)
Section 1: Lot 1, Lot 2, Lot 3 and Lot 4;
SW¼ SW¼, SE¼ SW¼, SE¼ SE¼
Township 7 South, Range 91 West, 6th P.M.
Section 1: SW¼ SE¼ (Rule 318.a. 40-acre portion)
Applicant requested that the Commission maintain the equivalent of one well per 10-acres on all lands, including the Application Lands reverting and subject to Rule 318.a.
7. On August 8, 2012, WPX, 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 Melanie Faith, Senior Landman for WPX, showed WPX holds a leasehold interest in the Application Lands. Testimony stated the modification of the original 332.20 acre drilling and spacing unit into a 292.20 acre drilling and spacing unit and 40 acre reversion to Rule 318.a. is a result of discussions between WPX and the mineral interest owners of the 40 acres.
9. 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.
10. WPX agreed to be bound by oral order of the Commission.
11. 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 existing 332.20-acre drilling and spacing unit established by Order Nos. 191-8 and 191-10 for Section 1, Township 7 South, Range 91 West, 6th P.M.; 2) establish an approximate 292.20-acre drilling and spacing unit for Section 1, Township 7 South, Range 91 West, 6th P.M., for the production of oil, gas and associated hydrocarbons from the Iles and Williams Fork Formations of the Mesaverde Group; and 3) revert the remaining approximate 40-acre portion of the established drilling and spacing unit to unspaced lands governed by Rule 318.a.
ORDER
NOW, THEREFORE IT IS ORDERED, that an existing 332.20-acre drilling and spacing unit established by Order Nos. 191-8 and 191-10 for Section 1, Township 7 South, Range 91 West, 6th P.M., is hereby vacated.
IT IS FURTHER ORDERED, that an approximate 292.20-acre drilling and spacing unit for the below-described lands, is hereby established, for the production of oil, gas and associated hydrocarbons from the Iles and Williams Fork Formations of the Mesaverde Group:
Township 7 South, Range 91 West, 6th P.M. (292.20-acre DSU)
Section 1: Lot 1, Lot 2, Lot 3 and Lot 4;
SW¼ SW¼, SE¼ SW¼, SE¼ SE¼
IT IS FURTHER ORDERED, that the remaining approximate 40-acre portion of the below-described lands will revert to unspaced lands governed by Rule 318.a.:
Township 7 South, Range 91 West, 6th P.M.
Section 1: SW¼ SE¼ (Rule 318.a. 40-acre portion)
IT IS FURTHER ORDERED, that all other provisions of Order Nos. 191-8 and 191-10 remain unaffected by this Order. The established well density equivalent of one well per 10-acres, shall remain on all lands, including those reverting and subject to Rule 318.a.
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 day of August, 2012, as of August 20, 2012.
OIL AND GAS CONSERVATION COMMISSION
OF THE STATE OF COLORADO
By____________________________________
Robert J. Frick, Secretary
Dated: August 30, 2012