IN THE MATTER OF GENERAL RULES AND REGULATIONS WITH RESPECT TO THE CONSERVATION OF OIL AND GAS IN THE STATE OF COLORADO, AND RULES OF PRACTICE AND PROCEDURE PERTAINING THERETO AND IN PARTICULAR WITH REFERENCE TO RULE 323

BEFORE THE OIL AND GAS CONSERVATION COMMISSION

OF THE STATE OF COLORADO

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 COUNTIES, COLORADO

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CAUSE NOS. 232 and 407

ORDER NOS. 407-79 and 232-53

REPORT OF THE COMMISSION

This cause came on for hearing before the Commission on November 18, 1991 at 8:30 a.m., in Room 101, State Education Building, 201 East Colfax Avenue, Denver, Colorado, after giving Notice of Hearing as required by law, on the application of the Erie Airpark Homeowners Association to establish additional field rules for certain lands in Township 1 North, Range 68 West, 6th P.M. Weld County, Colorado.

FINDINGS

The Commission finds as follows:

1. The Erie Airpark Homeowners Association 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.

4. The below-listed lands are within the area that comprises the Erie Airpark subdivision within the city limits of Erie, Colorado:

Township 1 North, Range 68 West, 6th P.M.

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Section 31: All

5. In Cause No. 232, the Commission established 320-acre drilling and spacing units for the production of gas from the "J" Sand in the Wattenberg Field with one well allowed for each unit to be located in the NE1/4 and SW1/4 and no closer than 990 feet to the boundaries of the quarter section. On August 21, 1979, the Commission issued Order No. 232-20 which allowed a second well to be drilled on each 320-acre unit. The lands listed herein are included within those lands established in Cause No. 232.

6. 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, with the option to drill an additional well on the undrilled 40-acre tract in each 80-acre drilling and spacing unit. In Order No. 407-10, 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. The lands listed herein are included within those lands established in Cause No. 407.

7. In Order Nos. 407-66 and 232-47, the Commission, among other things, established certain rules for wells drilled, completed and recompleted to the Codell Formation, where production is commingled or dually completed with production from the "J" Sand Formation. The lands listed herein below are included within those lands established in Cause No. 407.

8. Protests were filed by Martin Exploration Management Company and Vessels Oil and Gas Company.

9. After receiving public testimony at the hearing from private citizens and industry, and upon further review of previously approved field rules in a residential area, additional rules should be adopted to protect the health, safety and welfare of the citizens of Colorado, particularly those citizens living in residential areas.

ORDER

NOW, THEREFORE, IT IS ORDERED, that the following rules and regulations shall apply hereafter to a well or wells drilled, completed or recompleted in the below-listed lands in Weld County, Colorado, in addition to other applicable rules and regulations and orders of the Commission, if any, heretofore adopted and not in conflict herein:

Township 1 North, Range 68 West, 6th P.M.

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Rule 1: That evidence presented at the hearing indicates that a residential area shall be defined as "Any area that has an average platted density of 2.5 acres or less per dwelling or any building or well-defined outside area commonly used for public assembly."

1. Any well drilled in a residential area shall comply with the following rules:

	A. Surface locations of wellheads shall be located not less than 350 feet from any dwelling or facility as defined above.

	B. Production tanks and/or associated on-site production equipment shall be located not less than 350 feet from any dwelling or facility as defined above.

	C. All pumps, pits, wellheads and production facilities shall be adequately fenced to prevent access by unauthorized persons

	D. Each Survey plat accompanying an Application for Permit-to-Drill shall, in addition to the requirements of Rule 303, include the following information:

		1. All visible improvements within 350 feet of a well location must be physically tied in and plotted on the survey plat with a horizontal distance to the well location. Visible improvements include all dwellings and facilities as described above, public roads, major above-ground utility lines, railroads, pipelines, mines, oil or gas wells, injection wells, water wells, bodies of water, and natural channels through which water may flow. Surface uses must be described, and all surface property boundaries defined.

		2. An 8.5" x 11" copy of the most current 1:24,000 scale topo-graphic map of the area.

		3. A lease map showing all individual leases in the drilling unit, identifying the lessee, lessor, and surface ownership.

	E. Any equipment used in the drilling, completion or production of a well shall comply with C.R.S. 25-12-103, Maximum Permissible Noise Levels.

	F. All operations associated with the drilling, completion or production of a well shall comply with C.R.S. 25-7-101, Colorado Air Quality Control Act, as it applies to fugitive dust and venting or flaring of natural gas.

	G. If applicable, and where possible, development of multiple reser-voirs by drilling on existing pads or by multiple completions or commingling in existing wellbores is required.

	H. All other setbacks or safety requirements set out in the Colorado Oil and Gas Conservation Commission Rules and Regulations shall apply.

2(a). Exceptions to the location requirements set out in 1(A) and 1(B) may be granted by the Director if a copy of waivers from each owner of a dwelling or facility within 350 feet of the proposed location is submitted as part of the Application for Permit-to-Drill, and the proposed location complies with other safety requirements of the Rules and Regulations. An election by the owner to build a house less than 350 feet from an existing well, constitutes an election to waive the 350 foot setback rule.

2(b). This rule supercedes the existing Colorado Oil and Gas Conservation Commission Rule 603.

3. All wells drilled to the "J" Sand reservoir shall have surface casing set to a depth 50 feet below the base of the Fox Hills water sand and such casing will be cemented to surface.

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 16th of December, 1991, as of November 18, 1991.

OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO

Patricia C. Beaver, Secretary

Dated at Suite 380

1580 Logan Street

Denver, Colorado 80203

December 11, 1991