232-22

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 WATTENBERG GAS SPACED AREA, WELD COUNTY, COLORADO

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CAUSE NO. 232

ORDER NO. 232-22

REPORT OF THE COMMISSION

This cause came on for hearing before the Commission on October 19, 1981, at 9:00 a.m., in Room 110, State Centennial Building, Denver, Colorado, after giving Notice of Hearing as required by law, on three (3) applications of Excel Energy Corporation, for an order pooling all interests in the 320-acre drilling and spacing units consisting of (1) N½ Section 11; (2) S½ Section 11, and (3) W½ Section 2, all in Township 3 North, Range 67 West, 6th P.M., Wattenberg Gas Spaced Area. Two (2) applications, concerning the S½ Section 11 and the W½ Section 2, Township 3 North, Range 67 West, 6th P.M., were withdrawn at the time of the hearing.

FINDINGS

The Commission finds as follows:

1. Excel Energy Corporation, as applicant herein, 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 November 17, 1970, the Commission issued Order No. 232-1 which established 320-acre drilling and spacing units for the production of gas and associated hydrocarbons from the "J" Sand underlying certain lands in the Wattenberg Field. By subsequent Order Nos. 232-2, 232-3 and 232-5, the spaced area was expanded and the area became known as the Wattenberg Gas Spaced Area. Order No. 232-20, issued August 21, 1979, allowed the drilling of an additional well on certain 320-acre units in the spaced area.

5. That effort has been made to obtain the voluntary pooling of all interests in said drilling unit for the development and operation thereof, but that it has not been possible to secure the agreement of all owners of interests in said unit for the voluntary pooling thereof.

6. Applicant is an "interested person" within the meaning of 34-60-116 (6), CRS 1973, as amended, of the Oil and Gas Conservation Act of the State of Colorado.

7. In order to insure proper and efficient development of said drilling unit and to promote conservation of the gas resources of the State, an order should be made pooling all interests in the 320-acre drilling unit described herein.

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

9. 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 each tract bears to the total number of acres within said drilling unit.

ORDER

NOW, THEREFORE, IT IS ORDERED, that pursuant to the provisions of 34-60-116, CRS 1973, as amended, of the Oil and Gas Conservation Act of the State of Colorado, all interests in the drilling unit consisting of the N½ Section 11, Township S North, Range 67 West, 6th P.M., Wattenberg Gas Spaced Area, Weld County, Colorado, are hereby pooled for the development and 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 this order shall become effective forthwith.

ENTERED this 17th day of November 1981, as of October 19, 2981.

OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO

Frank J. Piro, Secretary