IN THE MATTER Of THE PROMULGATION AND ESTABLISHMENT Of FIELD RULES TO GOVERN OPERATIONS IN THE FLANK NORTHWEST FIELD, BACA COUNTY, COLORADO Cause No. 428 Order No. 428-1

REPORT OF THE COMMISSION

This cause came on for hearing before the Commission March 18, 1985 at 9:00 A.M., in the Community Room, 1 United Bank Center, 17th & Lincoln Streets, Denver, Colorado, after giving Notice of Hearing as required by law, on the verified application of Barrett Energy Co. for an order establishing certain designated drilling and spacing units of approximately 320-acres, more or less, for the production of oil, gas and associated hydrocarbons from the Cherokee formation underlying certain lands in Baca County, Colorado.

FINDINGS

The Commission finds as follows:

1. Barrett Energy Company, as applicant herein, 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. Based upon the facts stated in the verified application and exhibits submitted, and receiving no objections, and having been reviewed and recommended by the Director, the Commission should enter an order establishing 320-acre, more or less, drilling and spacing units for the production of oil, gas and associated hydrocarbons from the Cherokee formation underlying the following described lands in Baca County, Colorado, to-wit:

Township 33 South, Range 44 West, 6th P.M. Section 11: All Section 12: All except Lots 52, 54, 56 & 58 Section 13: All, except Tracts 53 and 54, Lots 4, 17, 18, 28, 47, 48, 50, 52 and 54 Section 14: All Section 23: All Section 24: All except Tract 64; Lots 4, 18, 21, 23, 24, 25, 26, 31, 32 and 33

5. In order to prevent the waste of oil and gas, as defined by law, to protect the correlative rights of all parties concerned; to prevent the drilling of unnecessary wells, and to insure proper and efficient development and promote conservation of the oil and gas resources of the State, an order should be made establishing certain designated drilling and spacing units consisting of approximately 320-acres, more less, for the production of oil, gas and associated hydrocarbons from the Cherokee formation, common source of supply underlying the lands described herein; that said units should be as designated with the permitted well location for each unit upon which it is located.

6. All available geological and engineering data concerning said formation indicate that one (1) well will efficiently and economically drain an area of approximately 320-acres, more or less, for the production of oil, gas and associated hydrocarbons from the Cherokee formation, and that the drilling units of the size and shape as described in the order, are not smaller than the maximum area that can be efficiently drained by one well producing from said formation.

ORDER

NOW, THEREFORE, IT IS ORDERED, that the following rules and regulations shall apply hereafter to wells drilled, completed, or recompleted in the Cherokee formation underlying lands in the Flank Northwest Field, herein described, in addition to other applicable rules and regulations and orders of the Commission, if any, heretofore adopted and not in conflict herewith. Rule 1. Drilling and spacing units of approximately 320-acres, more or less, are hereby established for the production of oil, gas and associated hydrocarbons from the Cherokee formation underlying the following described lands in the Flank Northwest Field, Baca County, Colorado, to-wit:

Township 33 South, Range 44 West, 6th P.M. Section 11: All Section 12: All except Lots 52, 54, 56 & 58 Section 13: All, except Tracts 53 and 54, Lots 4, 17, 18, 28, 47, 48, 50, 52 and 54 Section 14: All Section 23: All Section 24: All except Tract 64; Lots 4, 18, 21, 23, 24, 25, 26, 31, 32 and 33

Rule 2. Said drilling and spacing units and the permitted well locations with a tolerance of 200 feet in any direction to avoid surface hazards or obstructions are hereby designated and described as follows:

Township 33 South, Range 44 West, 6th P.M.

Unit 1. Section 11: W/2 more fully described as the NW/4; N/2SW/4; SE/4SW/4; Lots 8 and 9 containing a total of 319.97 acres, more or less. Permitted well located in the center of the NW/4 Section 11. Unit 2. Section 11: E/2 more fully described as the N/2NE/4; Lots 1, 3, 7, 10 and 13 and that portion of Tract 47 described as Lots 2, 4, 5,

6, 11 and 12 containing a total of 319.82 acres, more or less. Permitted well located 1320 feet from the south line and 660 feet from the west line of Tract 47. Unit 3. Section 12: W/2 more fully described as Lots 10, 11, 42 and 45; that portion of Tract 48 described as Lots 8, 9, 13 and 15; that portion of Tract 47 described as Lots 12, 40 and 41; that portion of Tract 49 described as Lots 14, 16, 38, 39, 43 and 44, containing a total of 326.04 acres, more or less. Permitted well located 1320 feet from the south line and 660 feet from the west line of Tract 48. Unit 4. Section 12: E/2 more fully described as Lots

5, 6, 19, 21, 47 and 50; that portion of Tract 48 described as Lots 7 and 17; that portion of Tract 49 described as Lots 18, 37 and 46; that portion of Tract 50 described as Lots 20, 22, 2 --

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35, 36, 48 and 49, containing a total of 340.47 acres, more or less. Permitted well located 1320 feet from the south line and 660 feet from the west line of Tract 50. Unit 5. Section 12: Described as Lots 4, 23, 24, 34 and 51; that portion of Tract 51 described as Lots 1, 2, 3, 25, 27 and 29; Tract 52, containing a total of 408.79 acres, more or less. Permitted well located 1320 feet from the south line and 1320 feet from the west line of Tract 51. Unit 6. Section 13: W/2 more fully described as N/2NW/4; Lots 7, 10, 36, 38 and 40; that portion of Tract 57 described as Lots 8, 34 and 35; that portion of Tract 56 described as Lots

9, 11, 32, 33, 37, and 39, containing 320-acres, more or less. Permitted well, the No. 1-13 Hancock, located 1700 feet from the west line and 600 feet from the north line of Section 13. Unit 7. Section 13: E/2 more fully described as Lots

5, 6, 12, 15, 42, 44 and 46; that portion of Tract 56 described as Lots 13, 31 and 41; that portion of Tract 55 described as Lots 14, 16, 29, 30, 43 and 45, containing 320-acres, more or less. Permitted well located 1320 feet from the south line and 660 feet from the west line of Tract 55. Unit 8. Section 14: W/2 more fully described as NE/4NW/4; Lots 1, 4, 5, 7, 19, 20 and 23; that portion of Tract 58 described as Lots 6,

8, 17, 18, 21 and 22, containing 319.80 acres, more or less. Permitted well located in the center of the NW/4 Section 14. Unit 9. Section 14: E/2 more fully described as N/2NE/4; Lots 9, 12, 25 and 28; that portion of Tract 58 described as Lots 10, 16 and 24; that portion of Tract 57 described as Lots 11, 13, 14, 15, 26 and 27, containing 319.86 acres, more or less. Permitted well located 660 feet from the south line and 1320 feet from the west line of Tract 57. Unit 10. Section 23: W/2, containing 320-acres, more or less. Permitted well located in the center of the NW/4 Section 23. Unit 11. Section 23: E/2, containing 320-acres, more or less. Permitted well located in the center of the SE/4 Section 23. Unit 12. Section 24: W/2 more fully described as the SW/4; Lots 10, 11 and 14; that portion of Tract 63 described as Lots 8, 9, 10 and 13, containing 320-acres, more or less. Permitted well located 1320 feet from the south line and 660 feet from the west line of Tract 63. Unit 13. Section 24: E/2 more fully described as Lots

5, 6, 16, 17, 27, 28, 29 and 30; that portion of Tract 63 described as Lots 7 and 15, containing 320-acres, more or less. Permitted well located in the center of Lots 27, 28, 29 and 30, being 1320 feet from the south line and 1320 feet from the west line of the 160-acre combined quarter section.

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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 April 1985, as of March 18, 1985

THE OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO

By Frank J. Piro, Secretary

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