REPORT OF THE COMMISSION

This cause came on for hearing before the Commission on July 17, 1973 at 9 A.M., in the Auditorium, Social Services Building, Denver, Colorado, after giving Notice of Hearing as required by law, on the application of Continental Oil Company, for an order establishing 160-acre drilling and spacing units for the production of gas and associated hydrocarbons from the Mancos formation underlying certain lands in Rio Blanco 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 evidence presented at the hearing indicates that the Mancos forma-tion constitutes a common source of supply of gas and associated hydrocarbons underlying the following described lands in Rio Blanco County, Colorado, to-wit: Township 3 South, Range 100 West, 6th P.M. Section 5: SW/4 Section 19: All Section 6: All Section 20: All Section 7: All Section 21: All Section 8: All Section 22: W/2 Section 9: S/2 Section 27: All Section 16: All Section 28: All Section 17: All Section 29: All Section 18: All Section 30: All Township 3 South, Range 101 West, 6th P.M. Section 1: All Section 24: All Section 12: All Section 25: N/2 Section 13: All

4. That in order to prevent the waste of 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 conservation of the gas resources of the State, an order should be made establishing 160-acre drilling and spacing units for the production of gas and associated hydrocarbons from the Mancos formation, common source of supply underlying the lands defined herein; that said units should be 160-acres, more or less, and consisting of a quarter section (or lots and/or quarter-quarter sections comprising approximately 160-acres), according to the govern-mental survey thereof; and that the permitted well for each such drilling unit should be (over) located no closer than 600 feet to the boundaries of the quarter section upon which it is located.

5. That the Commission may grant exceptions to the permitted well loca-tions without notice and hearing, provided the owners of the contiguous and cornering 160-acre, more or less, drilling units, file with the Commission a waiver or consent in writing agreeing to said locations.

6. That all available geological and engineering data concerning said Manco formation indicate that one well will efficiently and economically drain an area of approxi-mately 160 acres, and that drilling 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 said Mancos formation.

ORDER

NOW, THEREFORE, IT IS ORDERED, that the following rules and regula-tions shall apply hereafter to wells drilled, completed, or recompleted in the Mancos formation underlying the Cathedral Field herein described, in addition to other applicable rules and regulations and orders of the Commission, if any, heretofore adopted and not in conflict herewith:

Rule 1. One Hundred Sixty (160) acre drilling and spacing units shall be and the same are hereby established for the production of gas and associated hydrocarbons from the Mancos formation underlying the following described lands in the Cathedral Field, Rio Blanco. County, Colorado, to-wit: Township 3 South, Range 100 West, 6th P.M. Section 5: SW/4 Section 19: All Section 6: All Section 20: All Section 7: All Section 21: All Section 8: All Section 22: W/2 Section 9: S/2 Section 27: All Section 16: All Section 28: All Section 17: All Section 29: All Section 18: All Section 30: All Township 3 South, Range 101 West, 6th P.M. Section 1: All Section 24: All Section 12: All Section 25: N/2 Section 13: All

Rule 2. Said drilling units shall consist of one hundred sixty (160) acres, more or less, and each such drilling unit shall consist of a quarter section (or lots and/or quarter-quarter sections comprising approximately 160-acres), according to the govern-mental survey thereof, and the permitted well for each drilling unit shall be located no closer than 600 feet to the boundaries of the quarter section upon which it is located; pro-that exceptions may be granted to the provisions of this rule for well locations if owners of the contiguous and cornering 160-acre units file with the Commission a Liver or consent in writing, agreeing to said locations.

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

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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 17th day of July 1973.

THE OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO

By Frank J. Piro, Secretary

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