REPORT OF THE COMMISSION

This cause came on for hearing before the Commission on March 19, 1991, in Room 101, State Education Building, 201 East Colfax, Denver, Colorado, after giving Notice of Hearing, as required by law on the verified application of J.W. Gibson, Samedan Oil Corporation, and Robert L. Bayless for, an order extending the spaced area of the Neenoshe Field, as established by Order No. 388-1 and by Order No. 388-3 to include Sections 2, 3, 4, 5, 9, 10, 11, 15 and 16, Township 19 South, Range 47 West, 6th P.M., and further, the permitted well is to be located in compliance with Rule 318 of the Commission Rules and Regulations, with the exception that a distance of 2000 feet must be maintained from other wells drilling, completed or recompleted to the Middle Morrow Sand.

FINDINGS

The Commission finds as follows:

1. J.W. Gibson, Samedan Oil Corporation, and Robert L. Bayless, as applicants herein, are interested parties in the subject matter of the above-entitled 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 August 16, 1982, the Commission authorized Order No. 388-1 to be issued, which established 640-acre drilling and spacing units, consisting of governmental sections, for the production of gas and associated hydrocarbons from the Middle Morrow Sand underlying Sections 21, 22, 27 and 28, Township 19 South, Range 47 West, 6th P.M. The permitted well location was designated for each unit.

5. On February 13, 1987, the Commission authorized Order No. 388-3 extending the area of the Neenoshe Field to include Sections 19, 20, 29, and 30, Township 19 South, Range 47 West, for the production of gas and associated hydrocarbons from the Middle Morrow Sand, and that the permitted well for these additional 640 acre units shall be at a location no closer than 600 feet from the boundaries of the unit.

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6. Protests were filed with the Commission by Thomas L. Spring and Hawks Industries, Inc.

7. At the time of the hearing, the applicant withdrew the request for permitted Middle Morrow Sand wells to be located a distance of 2000 feet from other wells drilling, completed or recompleted to the Middle Morrow Sand.

8. The evidence presented at the hearing was sufficient to support the inclusion of only Sections 9, 10, 15 and 16 into the Neenoshe Field.

9. Based on the facts stated in the verified application, and exhibits submitted, the Commission should enter an Order extending the spaced area of the Neenoshe Field by the addition of the following described lands in Kiowa County, Colorado:

Township 19 South, Range 47 West, 6th P.M. Sections 9, 10, 15 and 16: All

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10. The permitted well for the 640-acre drilling and spacing units, as described in Finding 9 and including those described in Order Nos. 388-1 and 388-3, should be located in accordance with Rule 318 of the Commission Rules and Regulations.

ORDER

NOW THEREFORE IT IS ORDERED that Order No. 388-1 and Order No. 388-3 are hereby amended and the lands described in Finding 9 herein shall be included in the Neenoshe Field. The permitted well location for the area shall be in accordance with Rule 318 of the Commission Rules and Regulations. The spaced area of the Neenoshe Field shall henceforth consist of the following described lands in Kiowa County, Colorado:

Township 19 South, Range 47 West, 6th P.M. Section 9: All Section 21: All Section 10: All Section 22: All Section 15: All Section 27: All Section 16: All Section 28: All Section 19: All Section 30: All Section 20: All Section 33: All Section 34: All

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 with the verbal consent of the interested parties at the time of hearing, this order shall become effective forthwith.

ENTERED this day of , 1991, as of March 19, 1991.

OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO

By Patricia C. Beaver, Secretary

Dated at Suite 380 1580 Logan Street Denver, Colorado 80203 March 27, 1991 1092I - 3 -(388-6)