23-2

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 LEWIS CREEK FIELD, LOGAN COUNTY, COLORADO

)

CAUSE NO. 23

ORDER NO. 23-2

REPORT OF THE COMMISSION

This cause came on for hearing before the Commission on October 1958, at 10 a.m., in the Spruce Room of the Albany Hotel, Denver, Colorado, after publication of Notice of Hearing, as required by statute, and the mailing of copies of Application by the Applicant, pursuant to the Regulations of this Commission, on the application of The British-American Oil Producing Company, as Unit Operator of the "J" Sand Reservoir Unit Area, Lewis Creek Field, Logan County, Colorado, requesting an order of the Commission approving and adopting the Unitization Agreement for said Unit Area, and approving the proposed unitized operations and water flooding program for sand Unit Area.

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 and by the Regulations of this Commission.

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 underlying the Lewis Creek Field constitutes a common source of supply of oil and gas underlying all or substantially all of the following described lands in Logan County, Colorado:

Township 11 North, Range 52 West, 6th P.M.

Section 7:	S½ NW¼, SW¼
Section 18:	NW¼, N½ SW¼

Township 11 North, Range 53 West, 6th P.M.

Section 12:	S½ N½, S½
Section 13:	N½, N½ S½
Section 14:	NE¼ NE¼ NE¼

4. That Applicant is the Unit Operator of the "J" Sand Unit Area, Lewis Creek Field.

5. That the working interest owners in lands in the "J" sand formation of the Lewis Creek Field have all agreed to the Unitization Agreement for the Development and Operation of the "J" Sand Unit Area, Lewis Creek Field, a copy of which is attached to the application herein; and that a majority of the owners of royalty interests therein have executed said Unitization Agreement, which Unitization Agreement covers an area comprised of the lands hereinabove described.

6. That said Unitization Agreement and the unitized development and operation of said Unit Area, as proposed therein, are in the public interest for conservation and are reasonably necessary to increase ultimate recovery of oil and gas from said pool and to prevent the waste of oil and gas therefrom, and that said Unitization Agreement should, therefore, be approved and adopted by this Commission.

7. That the testimony presented at the hearing demonstrates that the "J" sand formation in the Lewis Creek Field has such reservoir characteristics which lend themselves to a successful repressuring water flood and secondary recovery program by the injection of water into said reservoir and that substantial quantities of oil will be recovered as a result of such program, which would otherwise not be recovered; and that estimates made by witnesses testifying at said bearing indicate that the water flooding program and result in the additional recovery of two million (2,000,000) barrels, or more, of oil, and that such additional recovery can be had without waste.

8. That the program water flooding submitted by Applicant and agreed to by the other working interest owners in the field propose

s the injection of water by drilling injection wells, said wells to be located initially as follows:

(a) 2640 feet north of the south line, and 5 feet west of the east line of Section 12-11N-53W.

(b) 5 feet north of the south line, and 5 feet west of the east line of Section 12-11N-53W.

(d) 1325 feet south of the north line, and 2635 feet east of the west line of Section 13-11N-53W.

(e) 1325 feet south of the north line, and 5 feet west of the east line of Section 13-11N-53W,

which wells are located at points in the Unit Area which will effect [sic] the maximum recovery of oil, and will affect the maximum protection of correlative rights within practical limits among all owners within the Unit Area, and as among the owners of royalty interests who have executed the said Unitization Agreement, and those who have not executed the Unitization Agreement; that said program and said well locations will minimize within practical limits the movement of oil and gas across lease lines within the Unit Area; that the institution and conduct of such a water flooding program is in accordance with sound petroleum engineering and oil field practice, and will be beneficial to all owners of interests within the Lewis Creek Field, and is in the public interest for conservation, as above noted; that all of the proposed injection wells should be properly cased by setting and cementing safe and adequate 9-5/8 inch casing from the surface to a depth of approximately forty (40) feet and from such depth down through the "J" sand formation by setting and cementing 4½-inch casing which will be perforated from the oil-water contact to the base of the "J" sand in each well; that said casing should be dry tested so as to prevent leakage and migration of water from the "J" sand to any other formation, which will adequately protect all other oil, gas, and fresh water bearing formations,

9. That the initial water supply for the secondary recovery program will be obtained from a water supply well already drilled within the Unit Area, and from two additional water supply wells to be located therein; that the initial proposed daily injection rate will be dependent upon the ability of the several injection wells to take water; and that it is estimated that this initial injection rate will approximate 15,000 barrels of water per day, which amount may necessarily increase in time, as water produced with oil increases as a result of the water injection program., that the Operator should give due consideration to the volumes of water being produced from the same tract or tracts upon which the water injection well or wells are located.

ORDER

NOW, THEREFORE, IT IS ORDERED, that the following rules and regulations shall apply hereafter to the lands set forth in this order, 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 Unitization Agreement for the Development and Operation of the "J" Sand Reservoir Unit Area, Lewis Creek Field, Logan County, Colorado, providing for the unit development and operation of the "J" sand reservoir underlying the following described lands:

South Half of the Northwest Quarter (S½ NW¼) and Southwest Quarter (SW¼) of Section Seven (7), and Northwest Quarter (NW¼) and North Half of the Southwest Quarter (N½ SW¼) of Section Eighteen (18) Township Eleven (11) North, Range Fifty-two (52)West, 6th P.M.; and the South Half of the North Half (S½ N½) and South Half (S½) of Section Twelve (12); North Half (N½} and North Half of the South Half (N½ S½) of Section Thirteen (13), and the Northeast Quarter of the Northeast Quarter of the Northeast Quarter (NE¼ NE¼ NE¼) of Section Fourteen (14), Township Eleven (11) North, Range Fifty-three (53) West, 6th P.M.,

herein referred to as "the Lewis Creek "J" Sand Unit Area”, is hereby adopted and approved; and the further development and operation of the Lewis Creek Field "J" Sand Unit Area, as above defined, as a single unit under the terms and provisions of the said Unitization Agreement, is hereby adopted and approved.

Rule 2. Applicant herein, as Unit Operator of the Lewis Creek Field "J" Sand Unit Area, is hereby permitted and authorized to conduct repressuring water flood operations and a secondary recovery program by the injection of water in the "J" sand, common source of supply of oil and gas in the Lewis Creek Field, Logan County, Colorado, as that field and Unit Area is defined hereinabove.

Rule 3. Operations for the injection of water shall be conducted by the drilling of new wells for injection purposes into the "J" sand formation, such initial locations to be as follows:

(a) 2640 feet north of the south line, and 5 feet west of the east line of Section Twelve (12) Township Eleven (11) North; Range Fifty-three (53) West;

(b) 5 feet north of the south line, and 5 feet west of the east line of Section Twelve (12), Township Eleven (11) North, Range Fifty-three (53) West;

(c) 2635 feet west of the east line, and 5 feet south of the north line of Section Thirteen (13) Township Eleven (11) North, Range Fifty-three (53) West;

(d) 1325 feet south of the north line, and 2635 feet east of the west line of Section Thirteen (13) Township Eleven (11) North, Range Fifty-three (53) West.

(e) 1325 feet south of the north line, and 5 feet west of the east line of Section Thirteen (13), Township Eleven (11) North, Range Fifty-three (53) West.

Each such well shall be perforated from the oil-water contact to the base of the "J" sand. Applicant is authorized to inject water into the "J" sand through such wells in such quantities as shall reasonably be determined by Applicant to best achieve the maximum recovery of oil under the repressuring program herein approved, without waste of oil and gas; and all water injection wells shall be properly cased with safe and adequate casing, cemented and dry tested, so that damage will not be caused to any oil, gas, or fresh water strata or resources, and the proposed casing and cementing procedure by Applicant as set forth hereinabove is hereby approved.

Rule 4. Applicant shall comply in all respects with Rule 405 of the General Rules and Regulations of this Commission.

Rule 5. The program of repressuring and secondary recovery by water injection, and the unitized operations and development of the "J" Sand Reservoir Unit Area, Lewis Creek Field, is hereby approved in the public interest for conservation and as reasonably necessary to increase ultimate recovery of oil and gas from said pool, and to prevent the waste of oil and gas therefrom, and in that it will protect the correlative rights of the respective owners in said field,

IT IS FURTHER ORDERED, that the Commission expressly reserves its right, upon notice and hearing to alter, amend, or repeal any and/or all of the foregoing provisions hereof.

ORDERED this 31st day of October, 1958.

OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO

By Annabel Hogsett, Secretary