BEFORE THE OIL AND
GAS CONSERVATION COMMISSION
OF THE STATE OF COLORADO
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IN THE MATTER OF
THE PROMULGATION AND ESTABLISHMENT OF FIELD RULES TO GOVERN OPERATIONS FOR
THE WILLIAMS FORK AND ILES FORMATIONS, |
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CAUSE
NO.
DOCKET NO. 170700515
TYPE: POOLING
ORDER
NO. CORRECTED |
REPORT OF THE COMMISSION
The Commission heard this matter on September 11, 2017, at the Durango Public Library, Program Room #2 at 1900 E. 3rd Avenue, Durango, Colorado, upon an application for an order to pool all interests within an approximate 323.72-acre drilling and spacing unit established for portions of Section 19, Township 9 South, Range 93 West, 6th P.M., and to subject any nonconsenting interests to the cost recovery provisions of §34-60-116(7), C.R.S., for the drilling of the Bruton 19-01W, Bruton 19-02W, Bruton 19-03W, Bruton 19-03E, Bruton 19-04W, Bruton 19-04E, Bruton 19-05W, Bruton 19-05E, Bruton 19-06W, Bruton Federal 19-06E, Bruton Federal 19-07E, Bruton 19-08W, Bruton Federal 19-08E, Bruton Federal 19-09E, Bruton Federal 19-10E, Bruton 19-11W, Bruton 19-14W, and the Bruton 19-16W wells, for the development and operation of the Williams Fork and Iles Formations.
FINDINGS
The Commission finds as follows:
1. Laramie Energy, LLC (“Laramie” or “Applicant”), 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 it has jurisdiction to promulgate the hereinafter prescribed order pursuant to the Oil and Gas Conservation Act.
4. On May 18, 2015, the Commission entered Order No. 369-14 which established the Application Lands as an approximate 323.72-acre drilling and spacing unit with the equivalent of one well per 10-acre density for all wells producing within the unit and directed that wells within the Application Lands be located no closer than 100 feet from the unit boundary line, or 200 feet from the unit boundary line if the unit abuts or corners lands not subject to 10-acre density, unless an exception is granted by the Director.
5. On May 25, 2017, Laramie, by its attorneys, filed with the Commission pursuant to §34-60-116 C.R.S., a verified application (“Application”) for an order to pool all interests in approximate 323.72-acre drilling and spacing unit established by Order No. 369-14 for the below-described lands (“Application Lands”), for the development and operation of the Williams Fork and Iles Formations, and to subject any nonconsenting interests to the cost recovery provisions of §34-60-116(7), C.R.S., for the drilling of the Bruton 19-01W, Bruton 19-02W, Bruton 19-03W, Bruton 19-03E, Bruton 19-04W, Bruton 19-04E, Bruton 19-05W, Bruton 19-05E, Bruton 19-06W, Bruton Federal 19-06E, Bruton Federal 19-07E, Bruton 19-08W, Bruton Federal 19-08E, Bruton Federal 19-09E, Bruton Federal 19-10E, Bruton 19-11W, Bruton 19-14W, and the Bruton 19-16W wells (“Wells”):
Township 9 South, Range 93 West, 6th P.M.
Section 19: NE¼, NE¼ NW¼, Lot 1, Lot 2, Lot 3
6. On July 5, 2017 (Amended on September 1, 2017), Applicant, by its attorneys, filed with the Commission a written request to approve the Application based on the merits of the verified Application and the supporting exhibits. Sworn testimony and exhibits were submitted in support of the Application.
7. On July 10, 2017, Dorothy Jensen (“Jensen” or “Protestant”) filed a protest to the Application. On September 1, 2017, after several prehearing conferences, Jensen withdrew her protest and confirmed that the parties had entered into a lease agreement.
8. Testimony and exhibits submitted in support of the Application by Barbara Hinman, Senior Landman for Applicant, showed all nonconsenting interest owners were notified of the Application and received Authority for Expenditures ("AFEs") and offers to participate in the Well. Further testimony concluded that the AFEs sent by the Applicant to the interest owners were fair and reasonable estimates of the costs of the proposed drilling operations and were received at least 35 days prior to the September 11, 2017 hearing date.
9. Applicant confirmed that there are no presently known nonparticipating working interest owners or unleased mineral interest owners subject to the Application, and Applicant is not seeking cost recovery pursuant to §34-60-116(7), C.R.S., for the Wells.
10. The above-referenced testimony and exhibits show that granting the Application will allow more efficient reservoir drainage, will prevent waste, will assure a greater ultimate recovery of hydrocarbons, and will not violate correlative rights.
11. Laramie has agreed to be bound by oral order of the Commission.
12. Based on the facts stated in the Application, having resolved all protests, and based on the Hearing Officer’s review of the Application under Rule 511, the Commission should enter an order to pool all interests in an approximate 323.72-acre drilling and spacing unit established for portions of Section 19, Township 9 South, Range 93 West, 6th P.M., for the drilling of the Wells, for the development and operation of the Williams Fork and Iles Formations.
ORDER
IT IS HEREBY ORDERED:
1. Pursuant to the provisions of §34-60-116, C.R.S., as amended, of the Oil and Gas Conservation Act, all interests in an approximate 323.72-acre drilling and spacing unit established for the below-described lands, are hereby pooled, for the development and operation of the Williams Fork and Iles Formations, for the drilling of the Bruton 19-01W, Bruton 19-02W, Bruton 19-03W, Bruton 19-03E, Bruton 19-04W, Bruton 19-04E, Bruton 19-05W, Bruton 19-05E, Bruton 19-06W, Bruton Federal 19-06E, Bruton Federal 19-07E, Bruton 19-08W, Bruton Federal 19-08E, Bruton Federal 19-09E, Bruton Federal 19-10E, Bruton 19-11W, Bruton 19-14W, and the Bruton 19-16W oil and gas wells (“Wells”):
Township 9 South, Range 93 West, 6th P.M.
Section 19: NE¼, NE¼ NW¼, Lot 1, Lot 2, Lot 3
2. The production obtained from the drilling and spacing unit shall be allocated to each owner in the unit on the basis of the proportion that the number of acres in such tract bears to the total number of mineral acres within the drilling and spacing unit; each owner of an interest in the drilling and spacing unit shall be entitled to receive its share of the production of the Wells located on the drilling and spacing unit applicable to its interest in the drilling and spacing unit.
3. Nothing in this order is intended to conflict with §34-60-116, C.R.S., as amended. Any conflict that may arise shall be resolved in favor of the statute.
IT IS FURTHER ORDERED:
1. The provisions in the above order shall become effective immediately.
2. The Commission reserves its right, after notice and hearing, to alter, amend, or repeal any and/or all of the above orders.
3. Under the State Administrative Procedures Act, the Commission considers this order to be final agency action for purposes of judicial review within 35 days after the date this Order is mailed by the Commission.
4. An application for reconsideration by the Commission of this Order is not required prior to the filing for judicial review.
ENTERED this 22nd day of September, 2017, as of September 11, 2017.
CORRECTED this 20th day of December, 2017, as of September 11, 2017
OIL AND GAS CONSERVATION COMMISSION
OF THE STATE OF COLORADO
By____________________________________
Julie Spence Prine, Secretary