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

)

)

)

)

CAUSE NO. 26

 

ORDER NO. 26-45

 

REPORT OF THE COMMISSION

 

This cause came on for hearing before the Commission on March 26, 1959, at 10:00 a.m., in the Spruce Room of the Albany Hotel, Denver, Colorado, after publication of Notice of Hearing as required by law, and pursuant to Order No. 26-40, which stipulated that the Commission should hold a hearing at the approximate time of pay-out of the Delaney No. 2 well in order to accept and review additional pertinent information for determination of an allocation for Tract 81-B.

 

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 wells on Tract 81-B were drilled on the edge of the Adena Field.

 

4.      That the drilling of edge wells should be encouraged; that the wells drilled by Petroleum, Inc. on Tract 81-B were step-out wells drilled at great risk, and afforded the Unit Area valuable information; that it, is the policy of our Commission to encourage and give special consideration to such exploratory wells; that such wells help define the limits of the Adena Field, and are a desirable aspect of oil and gas development in that such wells aid materially in protecting correlative rights and obtaining maximum ultimate recovery of oil and gas from the field.

 

5.      That it may be possible that the wells, or one of them, on Tract 81-B will cease to produce oil prior to abandonment of the field, due to water encroachment and structural position.

 

6.      That no substantial evidence was presented which would indicate that a violation of correlative rights has occurred, and the evidence shows that there was not at this time any appreciable drainage into Tract 81-B from the Unit Area. However, the Commission recognizes that the subject of drainage was not presented in detail by either side, so that neither party should be precluded from hereafter requesting a hearing on the question of drainage, should it believe its correlative rights are being violated.

 

7.      That the testimony regarding the oil is place underlying Tract 81-B is in substantial disagreement.

 

8.      That a tract oil allowable of 68 barrels will reasonably prevent the waste of oil in the field, giving due consideration, inter alia, to the fact that Tract 81-B is an edge area and may not be able to produce for the full life of the field.

 

ORDER

 

NOW, THEREFORE, IT IS ORDERED, that the following rules and regulations shall apply hereafter to the lands set forth in this order, 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 maximum allowable production of oil from that portion of the "J" sand pool underlying Tract 81-B of the Adena Field shall not, during any one (1) month, exceed a daily average of Sixty-eight (68) barrels.

 

IT IS FURTHER ORDERED, that all other orders relating to the oil and gas allowables for Tract 81-B are hereby superseded by this order.

 

IT IS FURTHER ORDERED, that this order 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 due to changed conditions in the field which may occur as a result of future drilling and development, or otherwise.

 

ORDERED this 22nd day of April, 1959.

 

OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO

 

 

By  Annabel Hogsett, Secretary