REPORT OF THE COMMISSION

This cause came on for hearing before the Commission on July 18, 1972, at 9 A.M., in Room 132, State Services Building, Denver, Colorado after giving Notice of Hearing as required by law, on the application of Texaco, Inc., for an order establishing 80-acre drilling and spacing units for the production of oil and associated hydrocarbons from the "J" Sand underlying certain lands in Arapahoe and Elbert 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 embraced in said Notice, and of the parties interested therein, and jurisdiction to promulgate the hereinafter prescribed order.

3. That insufficient evidence was presented at the hearing to indicate that the total area as presented in the application was underlain by a common source of supply of oil and associated hydrocarbons and therefore the following described lands in Arapahoe and Elbert Counties, Colorado should be deleted from the area to be spaced: Arapahoe County Township 5 South, Range 64 West, 6th P.M. Section 7: All Section 21: All Section 8: All Section 28: All Section 9: All Section 33: All Section 16: All Township 5 South, Range 65 West, 6th P.M. Section 11: All Section 12: All Elbert County Township 6 South, Range 64 West, 6th P.M. Section 4: All

4. That evidence presented at the hearing indicates that the "J" Sand con-stitutes a common source of supply of oil and associated hydrocarbons underlying the following described lands in Arapahoe and Elbert Counties, Colorado, to-wit:

Arapahoe County, Township 5 South, Range 64 West, 6th P.M. Section 17: All Section 29: All Section 18: All Section 30: All Section 19: All Section 31: All Section 20: All Section 32: All (over)

Township 5 South, Range 65 West, 6th P.M. Section 13: All Section 25: All Section 14: All Section 26: All Section 23: All Section 35: All Section 24: All Section 36: All

Elbert County Township 6 South, Range 64 West, 6th P.M. Section 5: All Section 6: All Township 6 South, Range 65 West, 6th P.M. Section 1: All Section 2: All

5. 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 conser-vation of the oil and gas resources of the State, an order should be made establishing 80-acre drilling and spacing units for the production of oil and associated hydrocarbons from the "J" Sand, a common source of supply underlying the lands defined herein; that said units should be 80-acre drilling units, and consisting of the W/2 and E/2 or the N/2"Y' and S/2 of 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 permitted well for each such drilling unit should be located in the center of the NE/4 and SW/4 of each quarter section, with a tolerance of 200 feet in any direction from said location to avoid surface hazards or obstructions.

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

7. That all oil wells heretofore drilled to and producing from or drilling to the "J" Sand should be the permitted wells for the drilling unit upon which they are located.

ORDER

NOW, THEREFORE, IT IS ORDERED, THAT the following rules and regula-tions shall apply hereafter to a well drilled, completed, or recompleted in the "J" Sand, underlying the Lowry Field herein described, in addition to other applicable rules and regulations and orders of the Commission, if any, heretofore adopted and not in con-flict herewith:

Rule 1. Eighty (80) acre drilling and spacing units shah be and the same are hereby established for the production of oil and associated hydrocarbons from the "J" Sand underlying the following described lands in the Lowry Field, Arapahoe and Elbert Counties, Colorado, to-wit:

Arapahoe County Township 5 South, Range 64 West, 6th P.M. Section 17: All Section 29: All Section 18: All Section 30: All Section 19: All Section 31: All Section 20: All Section 32: All

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Township 5 South, Range 65 West, 6th P.M. Section 13: All Section 25: All Section 14: All Section 26: All Section 23: All Section 35: All Section 24: All Section 36: All

Elbert County Township 6 South, Range 64 West, 6th P.M. Section 5: All Section 6: All Township 6 South, Range 65 West, 6th P.M. Section 1: All Section 2: All

Rule 2. Said drilling units shall consist of eighty (80) acres, and each such drilling unit shall be the W/2 and E/2 or the N/2 and 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 permitted well for each such drilling unit shall be located in the center of the NE/4 and SW/4 of each quarter section, with a tolerance of 200 feet in any direction from said location to avoid surface hazards or obstructions.

IT IS FURTHER ORDERED, that all oil wells heretofore drilled to and pro-ducing from or drilling to the "J" Sand shall be the permitted wells for the drilling unit upon which they are located.

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 order, rules and regulations.

ORDERED this 19th day of July, 1972.

THE OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO

By Frank J. Piro, Secretary

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