26-42

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 "J" SAND OF THE ADENA FIELD, MORGAN COUNTY, COLORADO

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CAUSE NO. 26

ORDER NO. 26-42

REPORT OF THE COMMISSION

This cause came on for hearing before the Commission on November 18, 1958, at 10:00 a m., in the Game Room of the Albany Hotel, Denver, Colorado, after publication of Notice of Hearing as required by law and pursuant to notices of continuation of hearing, on the application of The Pure Oil Company, as Unit Operator of the Adena "J" Sand Unit, for determination of maximum efficient rate of production of oil and gas from the Adena "J" Sand Field, establishment of the allowable daily quantities of oil and gas to be produced from said field in accordance with such MER determination, allocation of such total field production among the separate producing leases in the field, and amendment of existing field rules for said field regarding gas-oil ratios and reservoir pressure tests.

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 based on the engineering testimony presented, the Adena "J" Sand Field can currently produce without waste 15,000 stock tank barrels of oil, and 25,173,000 cubic feet of gas per day, and that the production at such rates will tend to increase the ultimate recovery of oil and gas from the field.

4. That there are three separately operated producing tracts in the field; namely, the Adena "J" Sand Unit, Tract 83, and Tract 81-B, as shown on Applicant’s Exhibit I, said Unit being deemed one producing tract for the purposes of this order.

5. That in order to prevent, insofar as is practicable, reasonably avoidable drainage between aforesaid producing tracts and to best utilize the energy in the field and to increase the ultimate recovery of oil, an allocation of the permitted field oil and gas production should be made between such tracts, based on the amount of oil and gas originally in place, in accordance with the formulae established by Rule 3 of Order No. 26-30 of this Commission, except as hereafter otherwise stated.

6. That the engineering and geologic information necessary for a proper determination of oil and gas in place in said pool is available and herein utilized.

7. That the temporary oil allowable applicable to Tract 81-B, as set out in Order No. 26-40, should remain in effect until payout of the Delaney No, 2 well thereon. Operator of said tract preserves its right to further hearing at the time of such payout on the issue of the quantity of oil and gas originally in place under such tract.

8. That the pressure maintenance program for the "J" Sand reservoir of the Adena Field has progressed to a degree which requires more flexibility in the manner and method of obtaining gas-oil-ratio and bottom-hole-pressure surveys; and that Rules 7 and 8 of Order No. 26-30 should be made more flexible.

ORDER

NOW, THEREFORE, IT IS ORDERED, that the following rules and regulations shall apply hereafter to the Adena "J"' Sand Field, in addition, to other applicable rules and regulations and orders of the Commission, if any, heretofore adopted and not in conflict herewith:

Rule 1. The Adena "J" Sand Unit Area, or "Unit" as referred to herein, is that certain unitized portion of the Adena "J" Sand Field described in Rule 3 of the Commission’s Order No. 26-27, as enlarged by Order No. 26-31 and for the purposes of this Order, said Unit shall be deemed one producing property.

Rule 2. The maximum allowable production from the "J" sand pool of the Adena Field shall not, during any one month, exceed a daily average of Fifteen Thousand (15,000) stock tank barrels of oil, and Twenty-five Million One Hundred Seventy-three Thousand (25,173,000) cubic feet of gas, unless and until otherwise ordered by the Commission.

Rule 3. Such oil and gas allowables shall be allocated among the producing properties in the Adena "J" Sand Field on a tract basis by application of the formulae set forth in Rule 3 of Order No. 26-30, as tabulated on Exhibit "C" attached hereto as a part of this rule, except as temporarily otherwise provided by Order No. 26-40 of this Commission. No tract shall produce in excess of its oil and gas allowable, except as herein otherwise provided.

IT IS FURTHER ORDERED, that Rule 7 of Order No, 26-30 is hereby modified to read as follows:

The operators and owners of wells producing from the "J" sand pool of the Adena Field shall make a gas-oil-ratio test of each producing well semi-annually, the testing periods to be the second and fourth quarters of each year, beginning with the months of April and October, which tests shall be taken before the last fifteen (15) days of the end of each such quarter. Each said well shall be produced at its normal stabilized rate of production for a period of twenty-four (24) consecutive hours prior to said test, and the gas-oil-ratio test shall be completed at such stabilized rate during the twenty-four (24) hours directly following. The results of such tests shall be reported to the Commission on or before the twenty-fifth (25th) day of the last month of the testing period. Prior to conducting such tests, the operator or owner shall submit to the Commission and to offset operators a schedule showing the wells and respective dates of tests, in sufficient time to allow the Commission and offset operators the opportunity to witness said tests. All non-producing wells may be exempted by the Commission from the semi-annual gas-oil-ratio testing. For good cause shown, the Commission may grant exceptions to this rule.

IT IS FURTHER ORDERED, that Rule 8 of Order No. 26-30 is hereby amended to read as follows:

The datum reservoir pressure of certain key wells in the Adena "J" sand pool shall be determined semi-annually. Key wells shall be selected by the operators and approved by the Commission. The results of each such semi-annual test shall be reported to the Commission by the operator of each key well. The pressure determinations shall be made at a datum of One Thousand and Fifty (1,050) feet below sea level. For good cause shown, the Commission may grant exceptions to this rule.

IT IS FURTHER ORDERED, that the rules set forth herein shall become effective December 1, 1958.

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 18th day of November, 1958.

OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO

By Annabel Hogsett, Secretary

EXHIBIT “C” of Order No. 26-30 as Amended by Order No. 26-42

	Column A	Column B	Column C	Column D	Column E

Tract Number	Reservoir Bbls. of “J” Sand oil originally in place	Reservoir Bbls. of “J” Sand gas originally in place	Reservoir Bbls. of “J” Sand oil and gas originally in place	Daily oil allowable Bbls./day	Daily gas allowable Mcf. /day
Non-Unitized*

81-B	271,083	0	271,083	22	24.5

83	714,040	19,350	733,390	56	66.2

Totals	985,123	19,350	1,004,473	78	90.7


Unit Area**	189,577,174	88,416,844	277,994,018	14,922	25,082.3

TOTALS FOR POOL	190,562,297	88,436,194	278,998,491	15,000	25,173.

* Tract 81-B as used herein is described as the E½ of Section 26, Township 1 North, Range 58 West.

Tract 83 as used herein is described as the S½ of Section 25, Township 1 north, Range 58 West.

** The Adena “J” Sand Unit Area, as used herein, is that certain unitized portion of the Adena “J” Sand Field described in Rule 3 of Order No. 26-27 and the additional area set forth in Rule 1 of Order No. 26-31.