REPORT OF THE COMMISSION

This cause came on for hearing before the Commission on September 19, 1988 at 8:30 a.m. in Room 101, Education Building, 201 East Colfax, Denver, Colorado, after giving Notice of Hearing, as required by law, on the verified application of TXO Production Corporation to extend the application of Order No. 449-7 including all drilling and spacing unit rules, well location rules, production restriction rules and all other such rules as applicable to certain lands in Section 25 and Section 36 of Township 14 South, Range 42 West, 6th P.M.

FINDINGS

The Commission finds as follows:

1. TXO Production Corporation as applicant herein, is an interested party 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. The application, as filed, requested an order extending the application of Order No. 449-7 to the production of oil and associated hydrocarbons including all drilling and spacing unit rules, well location rules, production restriction rules and all other such rules as are applicable to certain lands in the SW/4 of Section 25 and the NW/4 of Section 36 of Township 14 South, Range 42 West, 6th P.M.

5. Subsequent to the filing of the application an amended application was presented at an administrative hearing held September 15, 1988 before the Deputy Director as Hearing Officer. No protests were filed in the original application and the amended application was supported by Union Pacific Resources Company, who has a lease and production position in the lands to be spaced.

6. The Hearing Officer recommended the amended application

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be approved in order to prevent waste and protect correlative rights and that the W/2 of the SW/4, Section 25 and the W/2 of the NW/4, Section 36, Township 14 South, Range 42 West, 6th P.M. be included in Arapahoe spacing unit rules, well location rules, production restriction rules and all such other rules as are applicable in Cause No. 449 should be effective on these lands.

7. The Hearing Officer further recommended that the amended application be approved in order to prevent waste and protect correlative rights and that the E/2 of the SW/4, Section 25 and the E/2 of the NW/4, Section 36, Township 14 South, Range 42 West, 6th P.M. be included in Arapahoe East Field as ordered in Cause No. 456 and that all drilling and spacing unit rules, well location rules, production restriction rules and all such other rules as are applicable in Cause No. 456 should be effective on these lands. - 2 -(449-18 & 456-3)

ORDER

NOW, THEREFORE IT IS ORDERED, that the following lands shall be included in Arapahoe Field Area I as ordered in Cause No. 449 and that all drilling and spacing unit rules, well location rules, in Cause No. 449 shall be effective on these lands:

Township 14 South, Range 42 West, 6th P.M. Section 25: W/2 SW/4 Section 36: W/2 NW/4

IT IS FURTHER ORDERED, that the following lands shall be included in Arapahoe East Field as ordered in Cause No. 456 and that all drilling and spacing unit rules, well location rules, production restriction rules and all such other rules as are applicable in Cause No. 456 shall be effective on these lands:

Township 14 South, Range 42 West, 6th P.M. Section 25: E/2 SW/4 Section 36: E/2 NW/4

IT IS FURTHER ORDERED, that the provisions contained in the above order shall be effective forthwith.

IT IS FURTHER ORDERED, that the Commission expressly reserves its rights, after further notice of hearing, to alter, amend or repeal any and/or all of the order.

Entered this day of , 1988, as of September 19, 1988.

Corrected this day of , 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 May 9, 1991 1192I

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