REPORT OF THE COMMISSION

This cause came on for hearing before the Commission on April 20, 1971, at 9 A.M., in Room 132, State Services Building, 1525 Sherman Street, Denver, Colorado, after giving Notice of Hearing as required by law, on the application of Amoco Production Company, for an order establishing 80-acre drilling and spacing units for the production of oil from the "J" Sand, underlying certain lands in Adams and Arapahoe Counties, Colorado.

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.

2. That the Commission has jurisdiction over the subject matter em-braced in said Notice, and of the parties interested therein, and jurisdiction to pro-mulgate the hereinafter prescribed order.

3. That evidence presented at the hearing indicates that the "J"Sand constitutes a common source of supply of oil underlying the following described lands in Adams and Arapahoe Counties, Colorado, to-wit:

A dams County

Township 3 South, Range 61 West, 6th P.M. Section 28: All Section 31: All Section 29: All Section 32: All Section 30: All Section 33: All

Township 3 South, Range 62 West, 6th P.M. Section 25: All Section 36: All Arapahoe County

Township 4 South, Range 61 West, 6th P.M. Section 4: All Section 6: All Section 5: All

4. That in order to prevent the waste of oil and gas, as defined by law; to protect the correlative rights of all parties concerned; to prevent the drilling of unnecessary wells, and to insure proper and efficient development and promote con-servation of the oil and gas resources of the State, an order should be made estab-lishing 80-acre drilling and spacing units for the production of oil from the "J" Sand, common source of supply underlying the lands defined herein; that said units should be 80-acre drilling units, and consisting of the E/2 and the W/2 or the N/2 and the S/2 of

(over)

each quarter section, according to the governmental survey thereof, which drilling units should be designated at the time of filing the permit to drill; and that the per-mitted well for each such drilling unit should be located in the center of the NW/4 and the SE/4 of each quarter section, with a tolerance of 200 feet in any direction.

5. That all available geological and engineering data concerning said "J" Sand indicate that one well will efficiently and economically drain an area of approximately 80 acres, and that drilling units of the size and shape hereinabove described are not smaller than the maximum area that can be efficiently drained by one well producing from said "J" Sand.

6. That in order to promote orderly transition of a spacing pattern of one field.to that of an adjacent field, the operators in the Hombre Field should have some options as to where the permitted wells should be located in the drilling units adjacent to the boundaries of the Byers Field.

ORDER

NOW, THEREFORE,. IT IS ORDERED that the following rules and regu-lations shall apply hereafter to wells drilled, completed, or recompleted in the "J" Sand, underlying the Hombre Field herein described, in addition to other applicable rules and regulations and orders of the Commission, if any, heretofore adopted and not in conflict herewith:

Rule 1. Eighty (80) acre drilling and spacing units shall be and the same are hereby established for the production of oil from the "J" Sand underlying the follow-ing described lands in the Hombre Field, Adams and Arapahoe Counties, Colorado, to-wit:

Adams County

Township 3 South, Range 61 West, 6th P.M. Section 28: All Section 31: All Section 29: All Section 32: All Section 30: All Section 33: All

Township 3 South, Range 62 West, 6th P.M. Section 25: All Section 36: All Arapahoe County

Township 4 South, Range 61 West, 6th P.M. Section 4: All Section 6: All Section 5: All

Rule 2. Said drilling units shall consist of two (2) quarter-quarter sec-tions, lots, or tracts, or combinations of lots or tracts, comprising eighty (80) acres, more or less, and each such drilling unit shall be the E/2 and the W/2 or the N/2 and the S/2 of each quarter section, according to the governmental survey thereof, which drilling units shall be designated at the time of filing the permit to drill; and the per-mitted well for each such drilling up it shall be located in the center of the NW/4 and the SE/4 of each quarter section, with a tolerance of 200 feet in any direction.

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IT IS FURTHER ORDERED, that the permitted well on a drilling unit in the Hombre Field:

1. Which is adjacent to an area for which drilling units of equivalent size and a different spacing pattern for the "J" Sand are now or may hereafter be established by special order of the Commission for the "J" Sand formation, may be located in accordance with the spacing pattern prescribed for either area;

2. Which is offset either directly or diagonally by another drilling unit in the Hombre Field upon which a producing well has been located in accordance with the spacing pattern prescribed for another area, may also be located in accordance with the spacing pattern prescribed for either area;

3. Which is offset either directly or diagonally by a drilling unit upon which there is a producing well located in accordance with the pattern prescribed for the Hombre Field, and also by a drilling unit upon which there is a producing well located in accordance with the spacing pattern prescribed for some other area, may be located at any location on the intervening drilling unit no closer to the perimeter of the intervening drilling unit than would be permitted under either of the two per-mitted spacing patterns.

IT IS FURTHER ORDERED, that the rules and regulations contained herein 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, rules and regulations.

ORDERED this 28th day of April, 1971. OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO By Frank J. Piro, Secretary

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