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.   222-9

REPORT OF THE COMMISSION

                                  This cause came on for hearing before the Commission at 8:30 a.m. on April 19, 1993, in Room 318, Centennial Building, 1313 Sherman Street, Denver, Colorado, on the verified applications of Mull Drilling Company, Inc. for an order allowing the Crosby No. 3 Well to be drilled at an exception location in the center of the NW1/4 NW1/4 of Section 28, Township 13 South, Range 44 West, 6th P.M., for production of oil from the Mississippian Formation, and for an additional well, the Crosby No. 4 Well to be drilled in the SW1/4 NW1/4 of said Section 28 for production of oil from the Mississippian Formation for the 80-acre drilling and spacing unit consisting of the W1/2 of the NW1/4 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 E1/2 and W1/2 or the N1/2 and S1/2 of a governmental quarter section, with the permitted well to be located in the center of the NE1/4 and SW1/4 of each quarter section, with a tolerance of 150 feet in any direction to avoid obstruction and hazards.

                                  5.  No wells have been drilled in the 80-acre drilling and spacing unit consisting of the W1/2 of the NW1/4 of Section 28, Township 13 South, Range 44 West, 6th P.M. and Mull Drilling Company wishes to drill the Crosby No. 3 Well first which would be at an exception location to that authorized in Cause No 222; should it be productive and geologic conditions indicate, the Crosby No. 4 Well would be drilled as a second well on the unit.

                                  6.  Evidence presented at the administrative hearing indicated that two wells will more efficiently drain an 80-acre drilling and spacing unit, resulting in the recovery of additional oil and associated hydrocarbons from the Mississippian Formation.

                                  7.  That the Crosby No. 3 Well should be authorized to be drilled at an exception location in the center of the NW1/4 NW1/4 of said Section 28 for the 80-acre drilling and spacing unit consisting of the W1/2 NW1/4 of said Section 28 for production from the Spergen Member of the Mississippian Formation.

                                 8.  That in order to protect correlative rights and prevent waste, the Crosby No. 4 Well should be allowed to be drilled in the center of the SW1/4 NW1/4 of said Section 28 for the 80-acre drilling and spacing unit consisting of the W1/2 NW1/4 of said Section 28 for production from the Spergen Member of the Mississippian Formation.

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

O R D E R

                                  NOW, THEREFORE, IT IS ORDERED that Order No. 222-1 is hereby amended and the Crosby No. 3 Well is authorized to be drilled at an exception location in the center of the NW1/4 NW1/4 of Section 28, Township 13 South, Range 44 West, 6th P.M. with a tolerance of 150 feet in any direction for surface hazards and that the Crosby No. 4 Well is authorized to be drilled in the center of the SW1/4 NW1/4 of said Section 28 with a tolerance of 150 feet in any direction for surface hazards as an additional well for production from the Spergen Member of the Mississippian Formation for the 80-acre drilling and spacing unit consisting of the W1/2 of the NW1/4 of said Section 28.

                                  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_________________1993, as of April 19, 1993.

                                                                        OIL AND GAS CONSERVATION COMMISSION

                                                                        OF THE STATE OF COLORADO

                                                                        By _________________________________

                                                                            Patricia C. Beaver, Secretary

Dated at Suite 380

1580 Logan Street

Denver, Colorado 80203

April 19, 1993