25-4

BEFORE THE OIL AND GAS CONSERVATION COMMISSION

OF THE STATE OF COLORADO

IN THE MATTER OF THE INVESTIGATION TO TAKE MEASURES TO PREVENT WASTE OF OIL AND GAS IN THE NORTHWEST GRAYLIN FIELD, LOGAN COUNTY, COLORADO

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CAUSE NO. 25

ORDER NO. 25-4

REPORT OF THE COMMISSION

This cause came on for hearing before the Commission on March 18, 1955, at 10:00 a.m., in Room 704 State Capitol Annex, Denver, Colorado, after publication of Notice of Hearing as required by law, on the application of the British-American Oil Producing Company for an order from the Commission to extend the area of the Northwest Graylin Field, Logan County, 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 embraced in said Notice, and of the parties interested therein, and jurisdiction to promulgate the hereinafter prescribed order.

3. That the "D" sand of the Northwest Graylin Field constitutes a common source of supply of oil and gas underlying, in addition to the area set forth in Cause No. 25, Order No. 25-3, the following described lands in Logan County, Colorado, to-wit:

Area A

Township 8 North, Range 54 West, 6th P.M.

Section 11:	S½ NE¼, SE¼
Section 12:	S½, SE¼ NE¼, SW¼ NW¼
Section 13:	N½, N½ S½
Section 14:	NE¼, N½ SE¼

Township 8 North, Range 53 West, 6th P.M.

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

Area B

Township 8 North, Range 53 West, 6th P.M.

Section 5:	S½ NE¼, S½
Section 6:	E /2 SE¼
Section 7:	E½ NE¼
Section 8:	N½

4. That in order to prevent waste of oil and gas, as defined in the Colorado Oil and Gas Conservation Act of 1951, as amended; and to prevent the drilling of unnecessary wells, an order should be made establishing forty (40) acre drilling and spacing units for the production of oil and gas from the said "D" sand of the Dakota Series, common source of supply underlying said land, as defined herein; that said units should be forty (40) acre drilling and spacing units according to the governmental survey thereof, and that the permitted well lying within Area A should be located in the center of the Northeast (NE) Ten (10) acres of each forty (40) acre unit, according to the governmental survey thereof; and that the permitted well lying within Area B should be located in the center of the Southwest (SW) Ten (10) acres of each forty (40) acre unit, according to the governmental survey thereof; and that a tolerance of Fifty (50) feet in any direction from the prescribed locations in Area A and Area B, as set forth above, should be permitted to avoid surface hazards and obstructions.

5. That all available geological and engineering data concerning the said "D" sand of the Dakota Series in the Northwest Graylin Field and in the additional area hereinabove described, indicate that one well should efficiently and economically drain an area of approximately forty (40) acres, and that 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 the said "D" sand of the Dakota Series, common source of supply.

6. That an exception requested by the British-American Oil Producing Company should be allowed for the Shell Oil Company No. 1 Peterson well located in the center of the Southeast Quarter of the Northwest Quarter (SE¼ NW¼), Section Eighteen (18), Township Eight (8) North, Range Fifty-three (53) West of the 6th P.M., and that said well should be the permitted oil or gas well for the drilling and spacing unit upon which it is located.

ORDER

IT IS THEREFORE ORDERED, that the following rules and regulations shall apply hereafter to the lands set forth in this Order, and to those lands set forth in Cause No. 25, Order No. 25-1, referred to as the Northwest Graylin Field, in Logan County, Colorado, in addition to other applicable rules, regulations, and orders of the Commission heretofore adopted and not in conflict herewith.

Rule 1. Forty (40) acre drilling and spacing units shall be, and the same are hereby established for the production of oil and gas from the "D" sand of the Dakota Series, common source of supply underlying the following described lands in Logan County, Colorado, which include the original Northwest Graylin Field and the additional area herein described in the Findings:

Lots Three (3) and Four (4) and that land lying between said lots and the South township line of Township Nine (9) North, Range Fifty-three (53) West, and the South Half of the North Half (S½ N½) and South Half (S½), all in Section Five (5), Township Eight North (8N), Range Fifty-three (53) West of the 6th P.M.; Lots One (1), Two (2), Three (3), and Four (4), and that land lying between said lots and the South township line of Township Nine (9) North, Range Fifty-three [sic] and Range Fifty-four (54) West and the South Half of the North Half (S½ N½), North Half of the South Half (N½ S½), Southwest Quarter of Southwest Quarter (SW¼ SW¼), and Southeast Quarter of Southeast Quarter (SE¼ SE¼), all in Section Six (6), Township Eight (8) North, Range Fifty-three (53) West of the 6th P.M.; and the East Half of the Northeast Quarter (E½ NE¼), and South Half of Southwest Quarter (S½ SW¼), Section seven (7); the North Half (N½) Section Eight (8); Northwest Quarter (NW¼) and North Half of Southwest Quarter (N½ SW¼), Section Eighteen (18), all in Township Eight (8) North, Range Fifty-three (53) West of 6th P.M.; and Lots Five (5), Six (6), Seven (7), Eight (8), Nine (9), and Ten (10), and the South Half (S½), Section One (1); South Half of the Northeast Quarter (S½ NE¼), and Southeast Quarter (SE¼) Section Eleven (11); all of Section Twelve North Half (N½) and North Half of South Half (N½ S½), Section Thirteen (13); and Northeast Quarter (NE¼) and North Half of Southeast Quarter (N½ SE¼), Section Fourteen (14), all in Township Eight (8) North, Range Fifty-four (54) West of the 6th P.M.; and Lots Three (3) and Four (4), and East Half of Southwest Quarter (E½ SW¼) and Southeast Quarter (SE¼) Section Thirty-one (31), all in Township Nine (9) North, Range Fifty-three (53) West of the 6th P.M.; and the East Half of Southeast Half (E½ SE½), Section Thirty-six (36), Township Nine (9) North, Range Fifty-four (54) West of the 6th P.M.,

and such area shall henceforth be known as the Northwest Graylin Field.

Rule 2. Each governmental quarter quarter section, or equivalent thereof, as compared a regular governmental survey, and consisting of approximately forty (40) acres, shall constitute a drilling and spacing unit, and the permitted well for each unit shall be located in the center of the Southwest Quarter of each such unit, with the exception of Area A, as set forth in Paragraph 4 of the Findings, wherein each permitted well lying within said Area A shall be located in the center of the Northeast Quarter of each such unit, according to the governmental survey thereof, and that a tolerance of Fifty (50) feet in any direction from the prescribed location shall be permitted only where surface hazards or obstructions make it unduly hazardous or expensive to drill at the prescribed location.

IT IS FURTHER ORDERED, that an exception shall be granted for the Shell Oil Company's No. 1 Peterson well located in the center of the Southeast Quarter of the Northwest Quarter (SE¼ NW¼), Section Eighteen (18), Township Eight (8) North, Range Fifty-three (53) West of the 6th P.M., and that said well shall be the permitted oil or gas well for the drilling and spacing unit upon which it is located.

IT IS FURTHER ORDERED, that by order of the Commission, after due notice and hearing, the said "D" sand pool of the Northwest Graylin Field, in Logan County, Colorado, may be redesignated from time to time to embrace other lands in the vicinity which are believed, on the basis of additional development, to be capable of producing oil and gas from the said "D" sand pool of the Northwest Graylin Field, common source of supply.

IT IS FURTHER ORDERED, that the rules and regulations contained herein shall become effective forthwith, and henceforth the commencement of the drilling of any well or wells in the "D" sand pool of the Northwest Graylin Field, as defined herein, for the purpose of producing oil and gas therefrom at a location other than authorized by this Order, is hereby prohibited.

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 rules and regulations.

ORDERED this 18th day of March, 1955, by the Oil and Gas Conservation Commission of the State of Colorado.

OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO

By Annabel Hogsett, Secretary