IN THE MATTER OF THE PROMULGATION AND ESTABLISHMENT OF FIELD RULES TO GOVERN OPERATIONS IN THE WATTENBERG GAS SPACED AREA AND THE CODELL-NIOBRARA SPACED AREA, WELD COUNTY, COLORADO Cause No. 407, 232 Order No. 232-111, 407-152

REPORT OF THE COMMISSION

This cause came on for hearing before the Commission on June 20, 1994, in Room 318, State Centennial Building, 1313 Sherman Street, Denver, Colorado, after giving Notice of Hearing, as required by law on the application of Snyder Oil Corporation, for an order to approve an allocation method for eight wells to be recompleted from the "J" Sand Formation to the Codell and Niobrara Formations.

FINDINGS

The Commission finds as follows:

1. Snyder Oil Corporation as applicant 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 Cause No. 232, the Commission established 320-acre drilling and spacing units with said units to consist of the N1/2 and S1/2 or the E1/2 and W1/2 of a governmental section for production from the "J" Sand Formation and with the authorized well to be located in the NE1/4 and the SW1/4 of each section no closer than 990 feet from the boundaries of the quarter section. By Order No. 232-20, the Commission authorized the drilling of a second well for each 320-acre drilling and spacing unit with the additional well to be located no closer than 990 feet from the boundaries of the quarter section upon which it is located.

5. In Order No. 407-1, 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 center of the 40-acre tract or quarter-quarter section with a tolerance of 200 feet in any direction. In Order Nos. 407-10 and 407-13, the Commission amended Order No. 407-1 to include production from the Niobrara Formation in certain lands and to allow the downhole commingling of production from the Codell and Niobrara Formations.

6. Order Nos. 407-66 and 232-47 issued April 16, 1991, among other things, allowed the recompletion, downhole commingling and approval of allocation methods for production from the "J" Sand, Codell, and Niobrara Formations.

7. Allocation methods were sent to all working interest and royalty owners on March 3, 1994.

8. Based on the facts stated in the application, and receiving no protests and having been heard by the Hearing Officer on June 16, 1994 and recommended for approval, the Commission should enter an order approving an allocation method for the below-listed wells:

Codell Well Name Location J-Sand Unit Niobrara Unit Cresswell #1 14-4N-68W W1/2 S1/2 NW1/4 Couture 11-4N-68W N1/2 S1/2 NW1/4 Hart #1 15-4N-68W S1/2 E1/2 SE1/4 Purdy Trust #1 10-4N-68W S1/2 N1/2 SE1/4 Quarter Circle #1 1-4N-68W E1/2 N1/2 NE1/4 Rice #1 6-4N-67W W1/2 E1/2 SW1/4 Rudolph #1 11-4N-68W S1/2 S1/2 SE1/4 Vail #1 12-4N-68W W1/2 W1/2 NW1/4

ORDER

NOW, THEREFORE, IT IS ORDERED, that an allocation method is hereby approved for the below-listed wells for production from the "J" Sand, Codell and Niobrara Formations:

Codell Well Name Location J-Sand Unit Niobrara Unit Cresswell #1 14-4N-68W W1/2 S1/2 NW1/4 Couture 11-4N-68W N1/2 S1/2 NW1/4 Hart #1 15-4N-68W S1/2 E1/2 SE1/4 Purdy Trust #1 10-4N-68W S1/2 N1/2 SE1/4 Quarter Circle #1 1-4N-68W E1/2 N1/2 NE1/4 Rice #1 6-4N-67W W1/2 E1/2 SW1/4 Rudolph #1 11-4N-68W S1/2 S1/2 SE1/4 Vail #1 12-4N-68W W1/2 W1/2 NW1/4

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 day of , 1994, as of June 20, 1994.

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 July 8, 1994 ??

(232#111)