REPORT OF THE COMMISSION

This cause came on for hearing before the Commission on December 20, 1995 at 8:30 a.m., in Suite 801, The Chancery Building, 1120 Lincoln Street, Denver, Colorado, after giving Notice of Hearing as required by law, on why Snyder Oil Corporation, was not in violation of Rule No. 315, and conditions of permit approval, of the Oil and Gas Conservation Commission, and why it should not invoke the provisions of 34-60-121 C.R.S., as amended, providing for pen alties for violations of the Rules and Regulations of the Commission.

FINDINGS

The Commission finds as follows:

1. Snyder Oil Corporation 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.

4. On May 2, 1994, the Commission approved the drilling permit for the Hanscome No. 11-4I5 Well located in the NW1/4 NW1/4 of Section 11, Township 4 North, Range 65 West, 6th P.M., with the conditions on the permit specifying that the Sussex Formation be isolated by cement two hundred (200) feet above the top and two hundred (200) feet below the base of the Sussex Formation. The cement bond log run on May 26, 1994 indicated the Sussex Formation was not covered with the cement required. On July 28, 1995, the Commission issued a Notice of Alleged Violation (NOAV) to Snyder Oil Corporation for violations of Rule No. 315.j. and conditions of permit approval with corrective actions stipulated. On September 8, 1995, Snyder Oil Corporation submitted a Sundry Notice describing the proposed Sussex Formation cement squeeze. On October 25, 1995, Snyder Oil Corporation submitted an application to recomplete the well to the Codell and Niobrara Formations. As of that date, the Sussex Formation had not been isolated as required by the NOAV.

5. On December 12, 1995, an Administrative Order by Consent was issued by Commission staff with the agreement of Snyder Oil Corporation stating conditions of the NOAV issued on July 28, 1995 were not abated as required.

6. The Hearing Officer recommends that Snyder Oil Corporation be found in violation of Rule No. 315.j., failure to cement production string as required; and conditions of permit approval. Further, the Hearing Officer recommends that a fine of seven thousand five hundred dollars ($7,500) be assessed and a cement squeeze be performed on the Sussex Formation no later than January 15, 1996.

O R D E R

NOW, THEREFORE, IT IS ORDERED, that Snyder Oil Corporation shall be found in violation of Rule 315.j., failure to cement production string as required; and conditions of permit approval.

IT IS FURTHER ORDERED, that Snyder Oil Corporation shall be assessed a total fine of Seven Thousand Five Hundred Dollars ($7,500) payable within thirty (30) days after the order is issued.

IT IS FURTHER ORDERED, that Snyder Oil Corporation shall perform a cement squeeze on the Sussex Formation no later than January 15, 1996.

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.

ENTERED this day of , 1996, as of December 20, 1995.

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 January 15, 1996 ??