REPORT OF THE COMMISSION

This cause came on for hearing before the Commission on October 19, 1992, at 8:30 a.m., in Room 101, Education Building, 201 East Colfax, Denver, Colorado, after giving Notice of Hearing as required by law, on the verified application of Basin Operating Company, Inc. for an order allowing an additional well to be drilled on each 80-acre drilling and spacing unit consisting of the SW1/4 of Section 5, Township 2 North, Range 66 West, 6th P.M., Weld County, for the production of gas and associated hydrocarbons from the Sussex Formation underlying the 80-acre drilling and spacing units.

FINDINGS

The Commission finds as follows:

1. Basin Operating Company, Inc. as applicant herein, is an interested party in the subject matter of the above-referenced matter.

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 January 16, 1973, the Commission authorized Order No. 262-1 to be issued which, among other things, established 80-acre drilling and spacing units for the production of gas and associated hydrocarbons from the Sussex Formation underlying certain lands in the Spindle Field in Weld County, Colorado. The units shall consist of the E1/2 and W1/2 or N1/2 and S1/2 of each quarter section, with the permitted well to be located in the center of the NW1/4 and SE1/4 quarter section, with a tolerance of 200 feet in any direction.

5. On May 18, 1976, the Commission authorized Order Nos. 250-12, 262-4 and 266-4 to be issued which among other things, consolidated previous orders from the Spindle, Singletree and Surrey Fields, designating Cause No. 250 as the correct cause number for all of these fields.

6. Wells have been drilled and are producing in the SE1/4 SW1/4 and in the NE1/4 SW1/4 of Section 5, Township 2 North, Range 66 West, 6th P.M. Evidence presented at the administrative hearing indicated that two wells will more efficiently and economically drain a 80-acre drilling and spacing unit, resulting in the recovery of additional gas and associated hydrocarbons from the Sussex Formation.

7. That in order to protect correlative rights and prevent waste, an additional well should be allowed to be drilled in the center of each undrilled quarter-quarter, with a tolerance of 200 feet in any direction, for each 80-acre drilling and spacing unit consisting of the SW1/4 of Section 5, Township 2 North, Range 66 West, 6th P.M.

8. Based on the facts stated in the verified application and having been heard by the Hearing Officer who recommended approval of the application, and having received no protests, the Commission should approve the request and amend Order Nos. 250-12, 262-4 and 266-4 to allow additional wells to be drilled and completed on the 80-acre drilling and spacing unit herein described for production from the Sussex Formation, and subject to the approval of the C ommission.

O R D E R

NOW, THEREFORE IT IS ORDERED, that an additional well is hereby granted to be drilled on each 80-acre drilling and spacing unit in the SW1/4 of Section 5, Township 2 North, Range 66 West, 6th P.M., for production from the Sussex Formation.

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

IT IS FURTHER ORDERED, that the Commission expressly reserves its rights, after notice and hearing to alter, amend or repeal any and/or all of the above orders.

Entered this day of , 1992 as of October 19, 1992.

OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO

By Patricia C. Beaver, Secretary Dated at Suite 380 1580 Logan Street Denver, Colorado 80203 October 29, 1992 ??