REPORT OF THE COMMISSION

This Cause came on for hearing before the Commission on May 6, 1954, at 10 A.M., in Room 704 State Capitol Annex, Sherman Street and 14th Avenue, Denver, Colorado, after publication of Notice of Hearing as required by law, on the petition of the Continental Oil Company for an order establishing 40-acre drilling units and the location of wells thereon in the Bobcat Field in Washington and Morgan 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 em-braced in said Notice, and of the parties interested therein, and jurisdiction, to promulgate the hereinafter prescribed Order.

3. That the "D" sand pool of the Dakota Series in the Bobcat Field con-stitutes a common source of supply/underlying the following described lands:

Sections Three (3), Four (4), Five (5), Eight (8), Nine (9), Ten (10), Fifteen (15), Sixteen (16), and Seventeen (17), Township One (1) South, Range Fifty-six (56) West of the Sixth (6th) P.M., Washington County, Colorado; and Sections Thirty-two (32), Thirty-three (33), and Thirty-four (34), Township One (1) North, Range Fifty-six (56) West of the Sixth (6th) P.M., Morgan County Colorado.

4. That in order to prevent waste of oil and gas, as defined in the Colorado Oil and Gas Conservation Act of 1951, as amended; and to prevent the drilling of unnecessary wells, an order should be made establishing 40-acre drilling and spacing units for the production of oil from the said "D" sand pool of the Dakota Series, common source of supply underlying said land as de-fined herein; that said units should be 40-acre drilling and spacing units according to the governmental survey thereof; and that the permitted oil well for each unit should be located not less than Three Hundred Thirty (330) feet from any property line, lease line, or governmental quarter-quarter section line, and should be located not less than One Thousand Three Hundred Twenty (1320) feet from any other producible or drilling oil well located upon an adjoining drill-ing and spacing unit under lease to the same operator; except that in those sec-tions in this area which are short or not full sections, the limitation of One Thousand Three Hundred Twenty (1320) feet between wells should not apply so long as the wells remain Three Hundred Thirty (330) feet from said property lines. The wells should remain as near One Thousand Three Hundred Twenty (1320) feet apart as possible in said small sections.

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5. That all available geological and engineering data concerning the said "D" sand pool of the Dakota Series indicate that one well should efficiently and economically drain an area of approximately Forty (40) acres, and that 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 the said "D" sand pool of the Dakota Series.

ORDER

IT IS THEREFORE ORDERED, that the following rules and regulations shall apply hereafter to a well drilled, completed, or recompleted in the "D" sand pool of the Dakota Series of the Bobcat Field, in Morgan and Washington Counties, Colorado, as hereinabove defined in the Findings, which are hereby made a part hereof, 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 following drilling and spacing units shall be and the same are hereby established for the production of oil from the "D" sand pool of the Dakota Series, common source of supply underlying:

Sections Three (3) Four (4), Five (5), Eight (8), Nine (9), Ten (10), Fifteen 115), sixteen (16), and Seventeen (17), Township One (1) South, Range Fifty-six (56) West of the Sixth (6th) P.M., Washington County, Colorado; and Sections Thirty-two (32), Thirty-three (33), and Thirty-four (34), Township One (1) North, Range Fifty-six (56) West of the Sixth (6th) P.M., Morgan County, Colorado.

(a) Forty (40) acre drilling and spacing units, according to the governmental survey thereof, for the production of oil. The permitted well for each unit shall be located not less than Three Hundred Thirty (330) feet from any property line, lease line, or governmental quarter-quarter section line, and shall be located not less than One Thousand Three Hundred Twenty (1320) feet from any other producible or drilling oil well located upon an adjoining drill-ing and spacing unit under lease to the same operator; except that in those sections in this area which are short or not full sections, the limitation of One Thousand Three Hundred Twenty (1320) feet between wells shall not apply so long as the wells remain Three Hundred Thirty (330) feet from said property lines. The wells shall remain as near One Thousand Three Hundred Twenty (1320) feet apart as possible in said small sections.

IT IS FURTHER ORDERED, that the rules and regulations contained herein shall become effective forthwith, and henceforth the commencement of the drilling of any well or wells in the "D" sand formations of the Dakota Series, as defined herein, for the purpose of producing oil therefrom~ at a location other than authorized by this Order, is hereby prohibited.

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 rules and regulations.

ORDERED this 6th day of MaL 1954, by the Oil and Gas Conservation Com-mission of the State of Colorado.

THE OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO

By Annabel Hogsett, Asst. Secretary -- 2 -