IN THE MATTER OF THE PROMULGATION AND          CAUSE NO. 381
ESTABLISHMENT OF FIELD RULES TO GOVERN
OPERATIONS IN THE BRACEWELL FIELD,                    ORDER NO. 381-7
WELD COUNTY, COLORADO 

REPORT OF THE COMMISSION

This cause came on for hearing before the Commission on March 17, 1997, in Suite 801, The Chancery Building, 1120 Lincoln Street, Denver, Colorado, after giving Notice of Hearing, as required by law on the amended application of FEI-Seeley Joint Venture and Lyco Energy Corporation, for an order amending Cause No. 381 to redesignate the two 80-acre drilling and spacing units consisting of the E½NW¼ and the W½NE¼, both in Section 25, Township 6 North, Range 66 West, 6th P.M., to 80-acre drilling and spacing units consisting of the SE¼NW¼ and the SW¼NE¼, and the NE¼NW¼ and the NW¼NE¼, for production of oil and associated hydrocarbons from the Codell Formation.

FINDINGS

The Commission finds as follows:

1. FEI-Seeley Joint Venture and Lyco Energy Corporation as applicants herein, are interested parties 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. In Order Nos. 381 1, 381-2 and 381-3 the Commission established 80 acre drilling and spacing units for the production of oil and/or gas and associated hydrocarbons from the Codell Formation. Wells shall be located in the E½ or the W½ of each quarter section. In Order No. 381-5, the Commission amended Order Nos. 381 1, 381-2 and 381-3 to allow the drilling of an additional well on each 80-acre drilling and spacing unit. The N½ of Section 25, Township 6 North, Range 66 West, 6th P.M. was included in these orders.

5. Cache Exploration completed the Gerry #1 Well located in the NE¼NW¼ and the Gerry #2 Well located in the NW¼NE¼, both in Section 25, Township 6 North, Range 66 West, 6th P.M., on May 6 and May 10, 1983, respectively in the Codell Formation. These two wells are currently operated by Lyco Energy Corporation. Cache Exploration established an 80-acre pooling unit consisting of the NE¼NW¼ and NW¼NE¼ on October 27, 1983. Approval from the Oil and Gas Conservation Commission was not sought for this 80-acre spacing orientation exception to Order 381, Rule 2.

6. The Gerry #1 Well and Gerry #2 Well have a common tank battery and payout on the wells has occurred since October, 1983, according to the 80-acre unit described in Finding No. 5.

7. Snyder Oil Corporation (now operated by Patina Oil & Gas Corporation) completed the Kissler-Amen #1-25 Well located in the SW¼NW¼ of Section 25, Township 6 North, Range 66 West, 6th P.M., in November, 1983 for production from the Codell Formation for the 80-acre drilling and spacing unit consisting of the W½NW¼ of Section 25. Petromax (now operated by Jenex) completed the Adams #1-25 Well located in the NE¼NE¼ of Section 25, Township 6 North, Range 66 West, 6th P.M., in December, 1983 for production from the Codell Formation for the 80-acre drilling and spacing unit consisting of the E½NE¼ of Section 25.

8. No protests to the application were received, and the Commission should enter an order redesignating the two (2) 80-acre drilling and spacing units consisting of E½NW¼ and the W½NE¼, both in Section 25, Township 6 North, Range 66 West, 6th P.M., to 80-acre drilling and spacing units consisting of the SE¼NW¼ and the SW¼NE¼, and the NE¼NW¼ and the NW¼NE¼, for production of oil and associated hydrocarbons from the Codell Formation.

ORDER

NOW, THEREFORE, IT IS ORDERED, that Cause No. 381 is hereby amended to redesignate the two 80-acre drilling and spacing units consisting of the E½NW¼ and the W½NE¼, both in Section 25, Township 6 North, Range 66 West, 6th P.M., to 80-acre drilling and spacing units consisting of the SE¼NW¼ and the SW¼NE¼, and the NE¼NW¼ and the NW¼NE¼, for production of oil and associated hydrocarbons from the Codell 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 March , 1997, as of March 17, 1997.

OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO

By Patricia C. Beaver, Secretary

Dated in Suite 801, 1120 Lincoln Street, Denver, Colorado 80203 March 28, 1997

(381-7)