BEFORE THE OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO
IN THE MATTER OF THE PROMULGATION AND ESTABLISHMENT OF FIELD RULES TO GOVERN OPERATIONS IN THE SMOKY CREEK FIELD, CHEYENNE COUNTY, COLORADO	) ) ) )	CAUSE NO.  222 ORDER NO. 222-13 AMENDED

REPORT OF THE COMMISSION

                        This cause came on for hearing before the Commission at 8:30 a.m. on August 21, 1995, in Suite 801, The Chancery Building, 1120 Lincoln Street, Denver, Colorado, on the verified application of Mull Drilling Company, Inc. for an order allowing the Dorsey Kern Estate No. 1 Well to be drilled at an exception location in the SE¼ SW¼ of Section 28, Township 13 South, Range 44 West, 6th P.M., for production of oil from the Mississippian Formation for the 80-acre drilling and spacing unit consisting of the E½ SW¼ of said Section 28.

FINDINGS

                        The Commission finds as follows:

                        1.  Mull Drilling Company, Inc. as applicant herein, is an interested party in the subject matter of the above-referenced matter.

                        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 October 21, 1969 the Commission authorized Order No. 222-1 to be issued which established 80-acre drilling and spacing units for the production of oil and associated hydrocarbons underlying the Smoky Creek Field in Cheyenne County, Colorado.  The units shall consist of the E½ and W½ or the N½ and S½ of a governmental quarter section, with the permitted well to be located in the center of the NE¼ and SW¼ of each quarter section, with a tolerance of 150 feet in any direction to avoid obstruction and hazards.

                        5.  The Ashley No. 2 Well was previously drilled at a legal location in the NE¼ SW¼ of Section 28, Township 13 South, Range 44 West, 6th P.M. and plugged and abandoned as a dry hole.

                        6.  On December 20, 1993 the Commission authorized Order No. 222-11 to allow the Dorsey Kern Estate No. 1 Well to be drilled at an exception location in the center of the SE¼ SW¼ of Section 28, Township 13 South, Range 44 West, 6th P.M., for production of oil from the Mississippian Formation for the 80-acre drilling and spacing unit consisting of the E½ SW¼ of said Section 28.  This well was never drilled.

                        7.  Geological and engineering evidence presented at the administrative hearing indicated that a well in the SE¼ SW¼ of said Section 28 is necessary due to seismic information in order to recover all the hydrocarbons in the Mississippian Formation underlying the 80-acre drilling and spacing unit consisting of the E½ SW¼ of said Section 28.

                        8.  That in order to protect correlative rights and to prevent waste, the Dorsey Kern Estate No. 1 Well should be authorized to be drilled at an exception location 660 feet FSL and 2,180 feet FWL in the SE¼ SW¼ of said Section 28 for the 80-acre drilling and spacing unit consisting of the E½ SW¼ of said Section 28 for production from the Mississippian Formation.

                        9.  Based on the facts stated in the verified application and having been heard by the Hearing Officer who recommends approval of the application, and having received no protests, the Commission should approve the request and amend Order Nos. 222-1 and 222-11 to allow an exception well to be drilled and completed for production from the Mississippian Formation.

O R D E R

                        NOW, THEREFORE, IT IS ORDERED that Order Nos. 222-1 and 222-11 are hereby amended and the Dorsey Kern Estate No. 1 Well is authorized to be drilled at an exception location 660 feet FSL and 2,180 feet FWL in the SE¼ SW¼ of Section 28, Township 13 South, Range 44 West, 6th P.M., for production from the Mississippian Formation, for the 80-acre drilling and spacing unit consisting of the E½ SW¼ of said Section 28.

                        IT IS FURTHER ORDERED, that should a commercial well be completed at the location set forth above, the Commission shall, upon application of any interested person, take such action as will offset any advantage which the person securing the exception may have over other procedures by reason of the drilling of the well as an exception location.

                        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   -20th-       day of          September         1995, as of August 21, 1995.

                        AMENDED this  day of  1995, as of August 21, 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

October 23, 1995