20.4

BEFORE THE OIL AND GAS CONSERVATION COMMISSION

OF THE STATE OF COLORADO

IN THE MATTER OF THE PROMULGATION ESTABLISHMENT OF FIELD RULES GOVERN OPERATIONS IN THE BATTLE CANYON FIELD, WELD COUNTY, COLORADO

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CAUSE NO. 20

ORDER NO. 20-4

REPORT OF THE COMMISSION

This cause came on for hearing before the Commission on June 16, 1970, 10 A.M., in the P.U.C. Hearing Room, 5th Floor, Columbine Building 1845 Sherman Street, Denver, Colorado, after giving notice as required by law, on the application of Charles R. Barr, for an order establishing a 320-acre drilling and spacing unit for the production of gas and associated hydrocarbons from the "J" sand underlying the E½ of Section 23, Township 11 North, Range 56 West, Weld County, Colorado, and also that interests in said drilling unit be pooled. However, since there was a protest, the hearing was continued to July 21, 1970, to give the protestant an opportunity to present testimony in opposition to the application. On July 20, 1970, the Commission received letter from the protestant requesting a further continuation; which was denied.

FINDINGS

The Commission finds as follows:

1. That due notice of the time, place and purpose of the hearing has been given in all respects as required by law.

2. That 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.

3. That the "J" sand formation constitutes a common source of supply gas and associated liquid hydrocarbons underlying the Weld County, Colorado, to-wit:

Township 11 North, Range 56 West, 6th P.M.

Section 23:	E½

and is referred to as part of the Battle Canyon Field.

4. That in order to prevent waste of oil and gas, as defines by law to protect the correlative rights of all parties concerned; to prevent the drilling of unnecessary wells, and to insure proper and efficient development and promote conservation Of the oil and gas resources, an order should be made establishing 320-acre drilling and spacing unit for the production of gas and associated hydrocarbons from "J" sand formation, a common source of supply underlying the lands defined herein; that said unit should be the E½ Section 23, Township 11 North, Range 56 West, and that No. 1 Weld County-Wheeler well located 2055 feet from the North line and 1980 feet from the East line of said Section 23, should be the permitted gas well for said drilling and spacing unit.

5. That all geological and engineering data concerning the "J" sand formation in that portion of the Battle Canyon Field indicates that one well should efficiently economically drain an area of approximately 320 acres, and that the drilling unit of size and shape hereinabove described is not smaller than the maximum area that be efficiently drained by one well producing from said "J" sand formation.

6. That in order to insure proper and efficient development; to eliminate drilling of unnecessary wells; to promote conservation of gas resources of the State, order should be made pooling all interests in the 320-acre drilling unit described as E½ of said Section 23.

7. That the order of the Commission pooling all interests in said drilling unit is necessary, just and reasonable in order to afford each owner of interest within said drilling unit the opportunity to recover and receive his just and equitable share of gas from the common source of supply underlying said drilling unit.

8. That production obtained from said drilling unit should be allocated to each tract therein on the basis of the proportion that the number of acres in such tract bears to the total number of acres within said drilling unit.

ORDER

NOW, THEREFORE, IT IS ORDERED, that the following rules and regulations shall apply to a well drilled, completed or recompleted in the "J" sand formation underlying that portion of the Battle Canyon Field herein described, in addition to other applicable rules and regulations and orders of the Commission, if any, heretofore adopted and not in conflict herewith:

Rule 1. The "J" sand formation is a common source of supply of gas and associated liquid hydrocarbons underlying the following described land in Weld County, Colorado, to-wit:

Township 11 North, Range 56 West, 6th P.M.

Section 23:	E½

Rule 2. The following drilling and spacing unit shall be and the same is hereby established for the production of gas and associated liquid hydrocarbons from "J" sand, a common source of supply, underlying that portion of the Battle Canyon Field as defined herein:

(a) A 320-acre drilling and spacing unit, according to the governmental survey thereof, for the production of gas from the "J" sand, and the E½ of said Section 23, shall constitute a drilling unit.

(b) The permitted gas well on said unit shall be the Well No. 1 Weld County-Wheeler, located 2,055 feet from the North line and 1, 980 feet from the East line of said Section 23.

IT IS FURTHER ORDERED, that pursuant to the provisions of 100-6-4 the Oil and Gas Conservation Act of the State of Colorado, all interests in the drilling unit described as the E½ of said Section 23, are hereby pooled for the development operation of said drilling unit.

IT IS FURTHER ORDERED, that the production obtained from said drilling unit shall be allocated to each tract therein on the basis of the proportion that the number of acres in such tract bears to the total number of acres within said drilling unit, and each owner of interest in said tracts in said drilling unit, shall be entitled to receive his share of the production of the well located on said drilling unit applicable to his interest in said drilling unit.

IT IS FURTHER ORDERED, that the rules and regulations contained herein 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 rules and regulations.

ORDERED this 21st day of July, 1970.

OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO

By Frank J. Piro, Secretary