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	) ) ) )	CAUSE NO. 232 ORDER NO. 232-36

REPORT OF THE COMMISSION

TO ALL INTERESTED PERSONS AND TO WHOM IT MAY CONCERN:

This cause came on for hearing before the Commission on November 18, 1985 at 9:00 a.m. in Room 110, State Centennial Building, 1313 Sherman Street, Denver, Colorado, on the verified application of Howard T. Shannon to pool all interests in the 320-acre drilling and spacing unit consisting of the N1/2 Section 26, Township 1 North, Range 68 West, 6th P.M. for the development and operation of gas and associated hydrocarbons from the "J" Sand underlying said unit, and also on the verified application of Vessels Oil & Gas Co. to amend Order No. 232-1 and establish two (2) separate 160-acre drilling and spacing units consisting of (1) the NE1/4 and, (2) the NW1/4 Section 26, Township 1 North, Range 68 West.

FINDINGS

The Commission finds as follows:

1.      Howard T. Shannon & Vessels Oil & Gas Co., as applicants herein, are interested parties 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" underlying lands in the Wattenberg Gas Spaced Area, Weld County, Colorado.  The units consist of the E1/2 and W1/2 or the N1/2 and S1/2 of each section according to the governmental survey, with the permitted well located in the SW1/4 and NE1/4 of each section.  Subsequent orders extended the limits of the spaced area and allowed an additional well to be drilled on each 320-acre unit.

5.      Evidence presented at the hearing indicate that there are two (2) separately owned 160-acre tracts within the 320-acre drilling and spacing unit consisting of the N1/2 of Section 26, Township 1 North, Range 68 West, 6th P.M.  A producing well has been drilled in the NW1/4 of said section.  No voluntary pooling of the 320-acre unit has been accomplished.

6.      Geological evidence presented at the hearing indicates that the geology of one tract is not more favorable to the other for the drilling of a well, and no violation of correlative rights would occur if the operator of each tract is allowed to drill a well on its own 160-acre tract.

7.      Two (2) separate 160-acre units should therefore be established consisting of (1) the NE1/4 and, (2) the NW1/4 Section 26, Township 1 North, Range 68 West and the request to pool the 320-acre unit consisting of the N1/2 of said Section 26 [sic] denied.

ORDER

NOW, THEREFORE, IT IS ORDERED, that Order No. 232-1 is hereby amended and two (2) separate drilling and spacing units consisting of (1) the NE1/4 and, (2) the NW1/4 Section 26, Township 1 North, Range 68 West, 6th P.M. are hereby established for the production of gas and associated hydrocarbons from the "J" Sand underlying said unit.

IT IS FURTHER ORDERED, that the application requesting the pooling of all interests in the 320-acre unit consisting of the N1/2 Section 26, Township 1 North, Range 68 West is hereby denied.

IT IS FURTHER ORDERED, that the provisions contained in the above order shall become effective forthwith.

ENTERED this 12th day of December 1985, as of [sic]

OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO
	By	Frank J. Piro, Secretary