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 FOR THE CODELL AND NIOBRARA FORMATIONS, HEREFORD FIELD, WELD COUNTY, COLORADO

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CAUSE NO. 421

 

DOCKET NO. 1412-SP-2222

 

ORDER NO. 421-54

 

REPORT OF THE COMMISSION

 

            The Commission heard this matter on December 15, 2014 at the offices of the Colorado Oil and Gas Conservation Commission, 1120 Lincoln Street, Suite 801, Denver, CO, upon application for an order to establish an approximate 1318.71-acre drilling and spacing unit for Sections 16, 21, and 28, Township 12 North, Range 64 West, 6th P.M., and approve up to two horizontal wells within the unit, for the production of oil, gas, and associated hydrocarbons from the Codell and Niobrara Formations.

 

FINDINGS

 

The Commission finds as follows:

 

1.         Anadarko E&P Onshore LLC (“Anadarko” or “Applicant”) 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.         Rule 318.a. of the Rules and Regulations of the Oil and Gas Conservation Commission requires that, on unspaced lands, wells drilled in excess of 2,500 feet in depth be located not less than 600 feet from any lease line, and located not less than 1,200 feet from any other producible or drilling oil or gas well when drilling to the same common source of supply. Sections 16, 21, and 28, Township 12 North, Range 64 West, 6th P.M. are subject to this Rule for the Codell and Niobrara Formations.

 

5.         On October 16, 2014, Anadarko, by its attorneys, filed a verified application (“Application”) pursuant to §34-60-116 C.R.S. for an order to establish an approximate 1318.71-acre drilling and spacing unit for the below-described lands (“Application Lands”) and to approve up to two horizontal wells within the unit, for the production of oil, gas and associated hydrocarbons from the Codell and Niobrara Formations, with the productive interval of the wellbore to be located no closer than 600 feet from the unit boundaries, and no closer than 150 feet from the productive interval of any other wellbore located in the unit, without exception being granted by the Director:

 

Township 12 North, Range 64 West, 6th  P.M.

Section 16:      Lots 1-4 (approx. 38.71 acres) that                                                    portion lying within the State of Colorado

Section 21:      All

Section 28:      All

 

6.         On November 24, 2014, Anadarko, by its attorneys, 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.

 

            7.         Land testimony and exhibits submitted in support of the Application by Jason Rayburn, Landman for Anadarko, showed that Anadarko holds oil and gas leasehold interests and has a right to drill in the Application Lands.            

 

8.         Geologic testimony and exhibits submitted in support of the Application by Tom Berkman, Sr. Project Geological Advisor for Anadarko, showed that the Codell and Niobrara Formations are present throughout the Application Lands, that the Codell Formation is approximately 16 to 20 feet thick, that the Niobrara Formation is approximately 135 to 145 feet thick, and is generally of uniform thickness throughout the Application Lands.

 

9.         Engineering testimony and exhibits submitted in support of the Application by Emily Boecking, Senior Reservoir Engineer for Anadarko, showed that the drainage area for analog horizontal Codell and Niobrara Formation wells are estimated at 155 acres for the Niobrara and 90 to 259 acres for the Codell, and an appropriate 1318.71-acre drilling and spacing unit is therefore not less than the maximum area than can be efficiently, economically and effectively drained by a horizontal well producing oil, gas and associated hydrocarbons from the Codell and Niobrara Formations.

 

10.       The above-referenced testimony and exhibits show that granting the Application will allow more efficient reservoir drainage, will prevent waste, will assure a greater ultimate recovery of hydrocarbons, and will not violate correlative rights.

 

11.       Anadarko agreed to be bound by oral order of the Commission.

 

12.       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, the Commission should enter an order to establish an approximate 1318.71-acre drilling and spacing unit for Sections 16, 21, and 28, Township 12 North, Range 64 West, 6th P.M., and approve up to two horizontal wells within the unit, for the production of oil, gas, and associated hydrocarbons from the Codell and Niobrara Formations.

 


 

ORDER

 

IT IS HEREBY ORDERED:

 

1.         An approximate 1318.71-acre drilling and spacing unit for the below-described lands, is hereby established, for the production of oil, gas and associated hydrocarbons from the Codell and Niobrara Formations:

 

Township 12 North, Range 64 West, 6th  P.M.

Section 16:      Lots 1-4 (approx. 38.71 acres) that                                                    portion lying within the State of Colorado

Section 21:      All

Section 28:      All

 

2.         One horizontal well within the unit, is hereby approved, for the production of oil, gas and associated hydrocarbons from the Codell Formation; and one horizontal well within the unit, is hereby approved, for the production of oil, gas and assocaited hydrocarbons from the Niobrara Formation;

 

3.         The productive interval of the wellbore will be located no closer than 600 feet from the unit boundaries, and no closer than 150 feet from the productive interval of any other wellbore located in the unit, without exception being granted by the Director.

 

IT IS FURTHER ORDERED:

 

1.         The provisions contained in the above order shall become effective immediately.

 

2.         The Commission expressly reserves its right, after notice and hearing, to alter, amend or repeal any and/or all of the above orders.

 

3.         Under the State Administrative Procedure Act, the Commission considers this Order to be final agency action for purposes of judicial review within 35 days after the date this Order is mailed by the Commission.

 

4.         An application for reconsideration by the Commission of this Order is not required prior to the filing for judicial review.

 

ENTERED this 8th day of January, 2015, as of December 15, 2014.          

 

                                                                        OIL AND GAS CONSERVATION COMMISSION

                                                                        OF THE STATE OF COLORADO

 

 

                                                                        By__________________________________

Jill Dorancy, Acting Secretary