IN THE MATTER OF THE PROMULGATION AND          CAUSE NO. 365
ESTABLISHMENT OF FIELD RULES TO GOVERN
OPERATIONS IN THE BAXTER PASS FIELD,                  ORDER NO. 365-4
RIO BLANCO, COLORADO

REPORT OF THE COMMISSION

This cause came on for hearing before the Commission at 8:30 a.m. on April 21, 1997, in Suite 801, The Chancery Building, 1120 Lincoln Street, Denver, Colorado on the application of Cabot Oil & Gas Corporation, for an order extending the Baxter Pass Field rules to include Section 21, Township 4 South, Range 103 West, 6th P.M., Rio Blanco County, Colorado, for production from the Dakota-Morrison Formation.

FINDINGS

The Commission finds as follows:

1. Cabot Oil and Gas 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. On May 28, 1980, the Commission issued Order No. 365-1 which established 320-acre drilling and spacing units for the production of gas and associated hydrocarbons from the Dakota-Morrison Formation underlying certain lands in the Baxter Pass Field. The units consist of the N½ and S½ of each section with the existing wells being the permitted wells for the units upon which each is located, and for the remaining units the permitted wells to be located in accordance with Rule 318. On August 17, 1981, the Commission issued Order No. 365-2 which, among other things, expanded the Baxter Pass Field.

5. On September 4, 1996, the Applicant drilled and completed the Baxter Pass No. 43-21 Well at a location 1,940 feet FSL and 799 feet FEL in Section 21, Township 4 South, Range 103 West, 6th P.M. for production of gas and associated hydrocarbons from the Dakota-Morrison Formation, for the 320-acre drilling and spacing unit consisting of the S½ of said Section 21.

6. This matter was heard by the Hearing Officer who recommends approval based upon the testimony presented at the administrative hearing that the Dakota-Morrison Formation is a common source of supply in Section 21, as shown by the log from the Baxter Pass No. 43-21 Well, the isopach map prepared for the field, and pressure test data. Engineering testimony indicated that 320-acres is not smaller than the maximum area that can be efficiently and economically drained by one well.

7. That at the time of the aministrative hearing, the Applicant agreed to be bound by oral order of the Commission.

8. Based on the facts stated in the application, having received no protests, and having been heard by the Hearing Officer who recommends approval, the Commission should enter an order approving the application.

ORDER

NOW, THEREFORE, IT IS ORDERED that Order No. 365-1 is hereby amended to extend the Baxter Pass Field rules to include Section 21, Township 4 South, Range 103 West, 6th P.M., Rio Blanco County, Colorado, for production from the Dakota-Morrison Formation.

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.

ENTERED this 28th day of April, 1997, as of April 21, 1997.

OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO

By Patricia C. Beaver, Secretary

Dated at Suite 801, 1120 Lincoln Street, Denver, Colorado 80203 April 28, 1997

(365-4)