REPORT OF THE COMMISSION

This cause came on for hearing before the Commission on May 21, 1974 at 9 A.M., in the Department of Revenue Hearing Room, State Capitol Annex, Denver, Colorado, after giving Notice of Hearing as required by law, on the application of Zoller & Dameberg, Inc., for an order establishing 320-acre drilling and spacing units for the production of gas and associated hydrocarbons from the "J" Sand underlying certain lands in Adams 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 "J" Sand constitutes a common source of supply of gas and associated hydrocarbons underlying the following described lands in Adams County, Colorado, to-wit:

Township 2 South, Range 63 West, 6th P.M. Section 8: S/2 Section 15: All Section 9: All Section 16: All Section 10: All Section 17: All 4. 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 unneces-sary wells, and to insure proper and efficient development and promote conservation of the oil and gas resources of the State, an order should be made establishing 320-acre drilling and spacing units for the production of gas and associated hydrocarbons from the "J" Sand, common source of supply underlying the lands defined herein; that said units should be 320-acres, more or less, consisting of the E/2 and W/2 or the N/2 and S/2 of a governmental section, and the S/2 of Section 8, the N/2 and S/2 Sections 9 and 10, Township 2 South, Range 63 West, 6th P.M. should be designated as drilling and spacing units and the permitted well for each unit should be located in the NW/4, and the SE/4 of each section and no closer than 990 feet from the boundaries of the quarter section; provided, however, that Well No. 1 Vetter, located in the C SW/4SW/4 Section 10, Town-ship 2 South, Range 63 West, 6th P.M. be considered an exception and be the permitted well for the designated unit consisting of the S/2 of said Section 10, and Well No. 1 Meyer-UPRR, located in the C SW/4SE/4 Section 9, Township 2 South, Range 63 West, 6th P.M., should also be considered an exception and be the permitted well for the designated unit consisting of the S/2 of said Section 9. (over)

5. That all available geological and engineering data concerning said "J" Sand indicate that one well will efficiently and economically drain an area of approximately 320-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 "J" Sand.

ORDER

NOW, THEREFORE, IT IS ORDERED, that the following rules and regula-tions shall apply hereafter to wells drilled, completed, or recompleted in the "J" Sand underlying the Chieftain 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. Three Hundred Twenty (320) acre drilling and spacing units shall be and the same are hereby established for the production of gas and associated hydro-carbons from the "J" Sand underlying the following described lands in the Chieftain Field, Adams County, Colorado, to-wit:

Township 2 South, Range 63 West, 6th P.M. Section 8: S/2 Section 15: All Section 9: All Section 16: All Section 10: All Section 17: All

Rule 2. Said drilling units shall consist of three hundred twenty (320) acres, more or less, and each such drilling unit shall consist of the E/2 and W/2 or the N/2 and S/2 of a governmental section and the S/2 of Section 8, the N/2 and S/2 Sections 9 and 10, Township 2 South, Range 63 West, 6th P.M. shall be designated as drilling and spacing units, and the permitted well for each unit shall be located in the NW/4 and the SE/4 of each section and no closer than 990 feet from the boundaries of the quarter section; provided, however, that Well No. 1 Vetter, located in the C SW/4SW/4 Section 10, Town-ship 2 South, Range 63 West, 6th P.M. shall be considered an exception and be the per-mitted well for the designated unit consisting of the S/2 of said Section 10, and Well No. 1 Meyer-UPRR, located in the C SW/4SE/4 Section 9, Township 2 South, Range 63 West, 6th P.M., shall also be considered an exception and be the permitted well for the desig-nated unit consisting of the S/2 of said Section 9.

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 right, after notice and hearing, to alter, amend or repeal any and/or all of the above orders, rules and regulations.

ORDERED this 21st day of May 1974.

THE OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO

By Frank J. Piro, Secretary (#291)