BEFORE THE OIL AND GAS CONSERVATION COMMISSION
OF THE STATE OF COLORADO
IN THE MATTER OF THE PROMULGATION AND ) CAUSE NO. 381
ESTABLISHMENT OF FIELD RULES TO GOVERN )
OPERATIONS IN THE BRACEWELL FIELD, ) ORDER NO. 381-13
WELD COUNTY, COLORADO ) CORRECTED
REPORT OF THE COMMISSION
This cause came on for hearing before the Commission at 9:00 a.m. on January 13, 2009, in Suite 801, The Chancery Building, 1120 Lincoln Street, Denver, Colorado, for an order to designate two (2) stand-up 80-acre drilling and spacing units for the SW¼ of Section 33, Township 6 North, Range 66 West, 6th P.M., and to segregate the W½ SW¼ of said Section 33 into two (2) 40-acre drilling and spacing units consisting of the NW¼ SW¼ and SW¼ SW¼ of said section, for the production of oil and associated hydrocarbons from the Codell and Niobrara Formations.
FINDINGS
The Commission finds as follows:
1. Orr Energy, LLC (“Orr”), 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 pursuant to the Oil and Gas Conservation Act.
4. On June 27, 1983, the Commission issued Order No. 381-1, which among other things, established 80-acre drilling and spacing units for certain lands, including Section 33, Township 6 North, Range 66 West, 6th P.M., for the production of oil and associated hydrocarbons from the Codell Formation.
5. On June 18, 1984, the Commission issued Order No. 381-2, which among other things, amended Order No. 381-1 for certain lands, including Section 33, Township 6 North, Range 66 West, 6th P.M., to include the production of oil and associated hydrocarbons from the Niobrara Formation.
6. On February 18, 1985, the Commission Issued Order No. 381-5, which among other things, approved an optional additional well to be drilled in the undrilled 40-acre tract of the established 80-acre drilling and spacing units for certain lands, including Section 33, Township 6 North, Range 66 West, 6th P.M., for the production of oil and associated hydrocarbons from the Codell and Niobrara Formations.
7. On April 27, 1998, the Commission adopted Rule 318A., which among other things, allowed certain drilling locations to be utilized to drill or twin a well, deepen a well or recomplete a well and to commingle any or all of the Cretaceous Age Formations from the base of the Dakota Formation to the surface. On December 5, 2005, Rule 318A. was amended to, among other things, allow interior infill and boundary wells to be drilled and wellbore spacing units to be established. Section 33, Township 6 North, Range 66 West, 6th P.M. was included in this Rule.
8. On November 24, 2008, Orr, by its attorney, filed with the Commission a verified application for an order to designate two (2) stand-up 80-acre drilling and spacing units for the SW¼ of Section 33, Township 6 North, Range 66 West, 6th P.M., and to segregate the W½ SW¼ of said Section 33 into two (2) 40-acre drilling and spacing units consisting of the NW¼ SW¼ and SW¼ SW¼ of said section, for the production of oil and associated hydrocarbons from the Codell and Niobrara Formations.
9. On December 31, 2008, Orr, by its attorney, filed with the Commission a written request to approve the application based on the merits of the verified application and the supporting exhibits. Sworn written testimony and exhibits were submitted in support of the application.
10. Testimony and exhibits submitted in support of the application showed that Orr is the majority leasehold owner of the NW¼ SW¼ of Section 33, Township 6 North, Range 66 West, 6th P.M. Additional testimony indicated that Orr has obtained a permit-to-drill the PRR #33-13 Well, located in the NW¼ SW¼ of said section, for commingled production from the Codell, Niobrara, and “J” Sand Formations, and that the segregation of the W½ SW¼ of said section into two (2) 40-acre drilling and spacing units, consisting of the NW¼ SW¼ and SW¼ SW¼ of said section, will facilitate the drilling and completion of said well.
11. The above-referenced testimony and exhibits show that the proposed spacing will allow more efficient reservoir drainage, will prevent waste, will assure a greater ultimate recovery of oil and associated hydrocarbons, and will not violate correlative rights.
12. Orr Energy, LLC, agreed to be bound by oral order of the Commission.
13. Based on the facts stated in the verified application, having received no protests, and based on the Hearing Officer review of the application under Rule 511.b., the Commission should enter an order to designate two (2) stand-up 80-acre drilling and spacing units for the SW¼ of Section 33, Township 6 North, Range 66 West, 6th P.M., and to segregate the W½ SW¼ of said section into two (2) 40-acre drilling and spacing units consisting of the NW¼ SW¼ and SW¼ SW¼ of said section, for the production of oil and associated hydrocarbons from the Codell and Niobrara Formations.
ORDER
NOW, THEREFORE IT IS ORDERED, that two (2) 80-acre stand-up drilling and spacing units are hereby designated for the SW¼ of Section 33, Township 6 North, Range 66 West, 6th P.M., and the W½ SW¼ of said section is hereby segregated into two (2) 40-acre drilling and spacing units consisting of the NW¼ SW¼ and SW¼ SW¼ of said section, for the production of oil and associated hydrocarbons from the Codell and Niobrara Formations.
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.
IT IS FURTHER ORDERED, that under the State Administrative Procedure Act the Commission considers this order to be final agency action for purposes of judicial review within thirty (30) days after the date this order is mailed by the Commission.
IT IS FURTHER ORDERED, that an application for reconsideration by the Commission of this order is not required prior to the filing for judicial review.
ENTERED this 26th day of January, 2009, as of January 13, 2009.
CORRECTED this _______ day of February, 2009, as of January 13, 2009.
OIL AND GAS CONSERVATION COMMISSION
OF THE STATE OF COLORADO
By____________________________________
Robert A. Willis, Acting Secretary
Dated at Suite 801
1120 Lincoln Street
Denver, Colorado 80203
February 17, 2009