IN THE MATTER Of THE PROMULGATION AND ESTABLISHMENT Of FIELD RULES TO GOVERN OPERATIONS IN THE PAGODA FIELD. ROUTT COUNTY, COLORADO Cause No. 359 Order No. 359-1

REPORT OF THE COMMISSION

This cause came on for hearing before the Commission on November 19. 1979 at 9:00 A.M. in Room 110, State Centennial Building, Denver, Colorado, after giving Notice of Hearing as required by law, on the application or Mountain Petroleum Corporation for an order establishing a 640-acre drilling unit for the production of gas and associated hydrocarbons From the Shinarump formation underlying certain lands in Routt County. Colorado.

FINDINGS

The Commission finds as follows:

1. Mountain Petroleum Corporation, as applicant herein, is an interested party in the subject matter of the above-referenced hearing.

2. Due notice of the time place and purpose of the hearing has been given in all respects as required by law.

3. 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.

4. The Shinarump formation constitutes a common source of supply of gas and associated hydrocarbons underlying the following described lands in Routt County. Colorado to-wit:

Township 4 North, Range 89 West. 6th P.M. Section 33: All

5. In order to prevent waste of oil and gas as defined by law; to protect the correlative rights of all parties concerned; to prevent the drilling of unnecessary wells and to inspire proper and efficient development and promote conservation of the oil and gas resources an order should be made establishing a 640-acre drilling and spacing unit for the production of gas and associated hydrocarbons from the Shinetrump formation a com-mon source of supply underlying the lands defined herein; that said unit should be 640-acres and consist of the lands as herein described and the permitted well for said unit should be the No. 42-33 Federal located 1890 Feet from the north line and 500 feet from the east line of said Section 33.

6. All geological and engineering data concerning the Shinarump Formation indicate that one well will efficiently and economically drain an area of approximately 640-acres and that the drilling unit of the size and shape hereinabove described is not smaller than the maximum area that can be efficiently drained by one well producing from said Shinarump formation.

ORDER

NOW, THEREFORE, IT IS ORDERED, that the Following rules and regula-tions shall apply hereafter to a well drilled completed or recompleted in the Shinarump formation underlying the Pagoda 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:

(over)

Rule 1. A Six Hundred Forty (640) acre drilling and spacing unit shall be and the same, is hereby established for the production of gas and associated hydrocarbons from the Shinarump formation underlying the following described lands in the Pagoda Field, Routt County, Colorado, to-wit:

Township 4 North, Range 89 West, 6th P.M. Section 33: All

Rule 2. The permitted well for the above-described unit shall be the No. 42-33 Federal, located 1890 feet from the north line and 500 feet from the east line of said Section 33.

IT IS FURTHER ORDERED, that the provisions contained in the above order and rules and regulations 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.

ORDERED this 19th day of November, 1979.

THE OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO

By Frank J. Piro, Secretary

(#359-1)