BEFORE THE OIL AND GAS CONSERVATION COMMISSION

OF THE STATE OF COLORADO

IN THE MATTER OF THE PROMULGATION AND                                 )                             CAUSE NO. 510

ESTABLISHMENT OF FIELD RULES TO GOVERN                             )

OPERATIONS IN THE TRAIL RIDGE AREA,                                           )                             ORDER NO. 510-17

GARFIELD COUNTY, COLORADO                                                           )                             CORRECTED

&                        This cause came on for hearing before the Commission at 9:00 a.m. on December 6, 2005, Suite 801, in The Chancery Building, 1120 Lincoln Street, Denver, Colorado, for an order to allow the equivalent of one well per 10 acres, with the permitted well to be located downhole anywhere upon such lands but no closer than 100 feet from the outside boundary of the lands (or to any leasehold boundary within the lands) unless such boundary abuts or corners lands in respect of which the Commission has not at the time of the drilling permit application granted the right to drill 10-acre density wells in which event the Williams Fork Formation wells to be drilled upon the lands should be drilled downhole no closer than 200 feet from that portion of the boundary which so abuts or corners the lands in respect of which 10-acre density downhole drilling for Williams Fork Formation wells has not been ordered by the Commission for certain lands in Townships 5 and 6 South, Ranges 97 and 98 West, 6^th P.M., for the production of gas and associated hydrocarbons from the Williams Fork Formation of the Mesaverde Group.

                        1. Williams Production RMT Company ("Williams"), 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 pursuant to the Oil and Gas Conservation Act.

                        4. Rule 318.a. of the Rules and Regulations of the Commission requires that wells drilled in excess of two thousand five hundred (2,500) feet in depth be located not less than six hundred (600) feet from any lease line, and located not less than one thousand two hundred (1,200) feet from any other producible or drilling oil or gas well when drilling to the same common source of supply, unless authorized by order of the Commission upon hearing. The lands described below in Finding No. 5 are subject to this Rule.

                        5. On October 17, 2005, Williams, by its attorney, filed with the Commission a verified application for an order to change the existing well location and setback rules for the production of gas and associated hydrocarbons from the Williams Fork Formation of the Mesaverde Group, to allow the equivalent of one well per 10 acres with the permitted well to be located no closer than 100 feet from the outside boundary of the application lands unless such boundary abuts or corners lands in respect of which the Commission has not at the time of the drilling permit application granted the right to drill 10-acre density wells, in which event the Williams Fork Formation wells to be drilled upon the application lands should be drilled downhole no closer than 200 feet from that portion of the boundary which so abuts or corners the lands in respect of which 10-acre density downhole drilling for Williams Fork Formation wells has not been ordered by the Commission. That, except as previously authorized by order of the Commission, wells to be drilled under this application will be drilled from the surface either vertically or directionally from no more than one pad located on a given quarter quarter section unless exception is granted by the Colorado Oil and Gas Conservation Commission pursuant to application made for such exception for the below-described lands:

                                                            Township 5 South, Range 97 West, 6^th P.M.

                        7. Testimony and exhibits presented at the administrative hearing showed the geology of the Williams Fork Formation, emphasizing the discontinuity of the Williams Fork Formation sands in the application area. Additional testimony showed that for one hundred thirty six (136) sand bodies studied eighty (80) percent of the Williams Fork sands have a linear extent of less than seven hundred and fifty (750) feet and sixty (60) percent of the Williams Fork Sand bodies have a linear extent of less than five hundred (500) feet.

                        8. Testimony and exhibits presented at the administrative hearing showed that wells not drilled on exact fracture orientation showed average field performance.

                        10. Testimony and exhibits presented at the administrative hearing showed a summary of well economics, indicating that the proposed wells within the application area would have an after tax payout of 2.4 years assuming production characteristics similar to the wells analyzed in the pilot areas, and would be economic.

                        11. Williams Production RMT Company 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 having been heard by the Hearing Officer who recommended approval, the Commission should enter an order to allow the equivalent of one well per 10 acres, with the permitted well to be located no closer than 100 feet from the unit boundary for certain sections in Townships 5 and 6 South, Ranges 97 and 98 West, 6th P.M.

                                                            Township 5 South, Range 97 West, 6^th P.M.

                        IT IS FURTHER ORDERED, that, except as previously authorized by order of the Commission, wells to be drilled under this application shall be drilled from the surface either vertically or directionally from no more than one pad located on a given quarter quarter section (or lots or parcels approximately equivalent thereto) unless exception is granted by the Colorado Oil and Gas Conservation Commission pursuant to application made for such exception.

                        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.

                        IT IS FURTHER ORDERED, that under the State Administrative Procedure Act the Commission considers this order to be final agency action for purposes of judicial review within thirty (30) days after the date this order is mailed by the Commission.

                        IT IS FURTHER ORDERED, that an application for reconsideration by the Commission of this order is not required prior to the filing for judicial review.

                        ENTERED this 16^th day of December, 2005, as of December 6, 2005.

                        CORRECTED this _______ day of February, 2006, as of December 6, 2005.

                                                                            OIL AND GAS CONSERVATION COMMISSION

                                                                                        OF THE STATE OF COLORADO

                                                                            By ________________________________________ &#

                                                                                                    9; Patricia C. Beaver, Secretary

Dated at Suite 801

1120 Lincoln Street

Denver, Colorado 80203

February 28, 2006