BEFORE THE OIL AND GAS CONSERVATION COMMISSION
OF THE STATE OF COLORADO
IN THE MATTER OF THE APPLICATION OF WHITING OIL AND GAS
CORPORATION for an order TO establish FOUR APPROXIMATE 640-acre drilling and spacing
unitS FOR SECTIONS 9, 10, 24 and 34, Township 10 north, RANGE 59 WEST, 6th
p.m., FOR THE NIOBRARA FORMATION, UNNAMED FIELD, Weld County, Colorado |
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CAUSE NO. 535
DOCKET NO. 1309-SP-1149
ORDER NO. 535-417 |
REPORT OF THE COMMISSION
The Commission heard this matter on September 16, 2013, at the offices of
the Colorado Oil and Gas Conservation Commission, 1120 Lincoln Street, Denver,
Colorado, upon application for an order to establish four approximate 640-acre
drilling and spacing units for Sections 9, 10, 24 and 34, Township 10 North,
Range 59 West, 6th P.M., and approve up to sixteen horizontal wells
within each unit, for the production of oil, gas and associated hydrocarbons
from the Niobrara Formation.
FINDINGS
The Commission finds as follows:
1.
Whiting Oil and Gas Corporation (“Whiting” or “Applicant”), 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 Oil and Gas Conservation
Commission requires that 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 9, 10, 24 and 34, Township 10
North, Range 59 West, 6th P.M. are subject to this Rule for the
Niobrara Formation.
5.
On July 18, 2013, Whiting, by its attorneys, filed with the Commission
pursuant to Section 34-60-116, C.R.S., a verified application (“Application”)
for an order to establish four approximate 640-acre drilling and spacing units
for the below-described lands (“Application Lands”), and approve up to sixteen
horizontal wells within each unit, for the production of oil, gas and associated
hydrocarbons from the Niobrara Formation, with the treated interval of each
wellbore no closer than 200 feet from the treated interval of any other wellbore
producing from the Niobrara Formation, and no closer than 100 feet from a unit
boundary unless such boundary abuts or corners lands for which the Commission
has not at the time of the drilling permit application granted the right to
locate the treated interval of the wellbore no closer than 100 feet from a unit
boundary. If the Commission has not
at the time of the drilling permit application granted to the owners of the
adjacent or cornering lands the right to locate the treated interval of the
wellbore no closer than 100 feet from a unit boundary, then the treated interval
of the wellbore shall be located no closer than the distance permitted in the
adjacent or cornering lands, without exception being granted by the Director:
Township 10 North, Range 59 West, 6th P.M.
Section 9: All
(“DSU #1”, 640-acres)
Township 10 North, Range 59 West, 6th P.M.
Section 10: All
(“DSU #2”, 640-acres)
Township 10 North, Range 59 West, 6th P.M.
Section 24: All
(“DSU #3”, 640-acres)
Township 10 North, Range 59 West, 6th P.M.
Section 34: All
(“DSU #4”, 640-acres)
6.
On September 3, 2013, Whiting, 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
Scott McDaniel, Regional Land Manager for Whiting, showed that Whiting owns
significant leasehold interests in the Application Lands, and that all of the
unleased mineral interest owners and mineral lessees within the Application
Lands received notice of this Application.
8.
Geologic Testimony and exhibits submitted in support of the Application
by John R. Forster, Regional Geologic Manager for Applicant, showed the gross
thickness of the Niobrara Formation averages 320 feet across the Application
Lands. Testimony further showed the Niobrara Formation is present and continuous
throughout the Application Lands and constitutes a common source of supply.
9.
Engineering testimony and exhibits submitted in support of the
Application by Ralph L. Nelms, Senior Reservoir Engineer for Whiting, included
rate transient analysis (RTA), data from downhole pressure gauge responses, and
volumetric and economic analysis supporting horizontal wellbore density of up to
16 wells within the unit. Estimated
ultimate recovery (“EUR”) was estimated at 142 MBO of oil and 128 MMCF of gas
per well. Further testimony
concluded the economics of the project are sound.
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.
Whiting 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 four approximate 640-acre
drilling and spacing units for Sections 9, 10, 24 and 34, Township 10 North,
Range 59 West, 6th P.M., and approve up to sixteen horizontal wells
within each unit, for the production of oil, gas and associated hydrocarbons
from the Niobrara Formation.
ORDER
IT IS HEREBY ORDERED:
1.
Four approximate 640-acre drilling and spacing units for the
below-described lands, are hereby established, and up to sixteen horizontal
wells within each unit, are hereby approved, for the production of oil, gas and
associated hydrocarbons from the Niobrara Formation, with the treated interval
of each wellbore no closer than 200 feet from the treated interval of any other
wellbore producing from the Niobrara Formation, and no closer than 100 feet from
a unit boundary unless such boundary abuts or corners lands for which the
Commission has not at the time of the drilling permit application granted the
right to locate the treated interval of the wellbore no closer than 100 feet
from a unit boundary. If the
Commission has not at the time of the drilling permit application granted to the
owners of the adjacent or cornering lands the right to locate the treated
interval of the wellbore no closer than 100 feet from a unit boundary, then the
treated interval of the wellbore shall be located no closer than the distance
permitted in the adjacent or cornering lands, without exception being granted by
the Director:
Township 10 North, Range 59 West, 6th P.M.
Section 9: All
(“DSU #1”, 640-acres)
Township 10 North, Range 59 West, 6th P.M.
Section 10: All
(“DSU #2”, 640-acres)
Township 10 North, Range 59 West, 6th P.M.
Section 24: All
(“DSU #3”, 640-acres)
Township 10 North, Range 59 West, 6th P.M.
Section 34: All
(“DSU #4”, 640-acres)
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 30
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 11th
day of October, 2013, as of September 16,
2013.
OIL AND GAS CONSERVATION COMMISSION
OF THE STATE OF COLORADO
By____________________________________
Robert J. Frick, Secretary