BEFORE THE OIL AND GAS CONSERVATION
COMMISSION
OF THE STATE OF COLORADO
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IN THE MATTER OF THE PROMULGATION AND
ESTABLISHMENT OF FIELD RULES TO GOVERN OPERATIONS FOR THE CODELL AND NIOBRARA
FORMATIONS, UNNAMED FIELD, WELD COUNTY, COLORADO
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CAUSE NO. 535
DOCKET NO. 150500252
ORDER NO. 535-667
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REPORT OF THE COMMISSION
The Commission heard this matter on May 18, 2015, at the Aims Community
College, 260 College Avenue, Fort Lupton, Colorado, upon application for an
order to: 1) establish an approximate 1280-acre drilling and spacing unit for
Section 3, Township 11 North, Range 64 West, 6th P.M., and Section
34, Township 12 North, Range 65 West, 6th P.M., and approve up to
seven horizontal wells within the proposed unit, for the production of oil, gas
and associated hydrocarbons from the Niobrara Formation; and 2) approve an
additional five horizontal wells, for a total of six horizontal wells, within
an approximate 1280-acre drilling and spacing unit established by Order No.
535-565 for Section 3, Township 11 North, Range 64 West, 6th P.M.,
and Section 34, Township 12 North, Range 64 West, 6th P.M., for the production
of oil, gas and associated hydrocarbons from the Codell Formation.
FINDINGS
The Commission finds as follows:
1.
Anadarko
E&P Onshore LLC (“Anadarko” 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.
5.
On October
27, 2014, the Commission entered Order No. 535-565 which, among other things,
established an approximate 1280-acre drilling and spacing unit for the
Application Lands, and approved one horizontal well within the unit, for
production of oil, gas and associated hydrocarbons from the Codell Formation.
6.
On February 18, 2015,
Anadarko, by its attorneys, filed
with the Commission a verified application (“Application”) for an order to: 1)
establish an approximate 1280-acre drilling and spacing unit for Section 3,
Township 11 North, Range 64 West, 6th P.M., and Section 34, Township
12 North, Range 64 West, 6th P.M., and approve up to seven horizontal
wells within the proposed unit, for the production of oil, gas and associated
hydrocarbons from the Niobrara Formation; and 2) approve an additional five
horizontal wells, for a total of six horizontal wells, within an approximate
1280-acre drilling and spacing unit established by Order No. 535-565 for production
from the Codell Formation:
Township 11 North, Range 64 West, 6th
P.M.
Section 3: All
Township 12 North, Range 64 West, 6th
P.M.
Section 34: All
7.
Applicant
states that any horizontal well to be drilled under this Application will be
drilled from the surface of the drilling unit, or on adjacent lands with
consent of the landowner, unless an exception is granted by the Director.
8.
On April 27, 2015, 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.
9.
Testimony
and exhibits submitted in support of the Application by Jason Rayburn, Landman
for Anadarko, showed that Anadarko owns
substantial leasehold interests in the Application Lands.
10.
Testimony
and exhibits submitted in support of the Application by Thomas A. Berkman,
Senior Project Geologist for Anadarko, showed that the Codell and Niobrara
Formations underlie the entirety of the Application Lands. The Codell
Formation ranges from approximately 16 to 20 feet thick, and the Niobrara
Formation ranges from 135 to 140 feet thick.
11.
Testimony
and exhibits submitted in support of the Application by Emily Boecking,
Reservoir Engineer for Anadarko, showed that the estimated drainage area for
the Codell Formation ranges from 94 to 286 acres for approximate 1280-acre
laterals and would accommodate the drilling of an additional five horizontal
wells, for a total of six horizontal wells, for the Codell Formation. The
estimated drainage area for the Niobrara Formation is an estimated 137 acres
for approximate 1280-acre laterals, and would accommodate the drilling of up to
seven horizontal wells for the Niobrara Formation.
12.
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.
13.
Anadarko agrees to be bound by oral order of the Commission.
14.
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: 1) establish an approximate 1280-acre
drilling and spacing unit for Section 3, Township 11 North, Range 64 West, 6th
P.M., and Section 34, Township 12 North, Range 64 West, 6th P.M.,
and approve up to seven horizontal wells within the proposed unit, for the
production of oil, gas and associated hydrocarbons from the Niobrara Formation;
and 2) approve an additional five horizontal wells, for a total of six
horizontal wells, within an approximate 1280-acre drilling and spacing unit
established by Order No. 535-565 for Section 3, Township 11 North, Range 64
West, 6th P.M., and Section 34, Township 12 North, Range 64 West, 6th
P.M., for the production of oil, gas and associated hydrocarbons from the Codell
Formation.
ORDER
IT IS HEREBY ORDERED:
1.
An
approximate 1280-acre drilling and spacing unit for the below-described lands,
is hereby established, and a total of up to seven horizontal wells within the
unit, are hereby approved, for the production of oil, gas and associated
hydrocarbons from the Niobrara Formation:
Township 11 North, Range 64 West, 6th
P.M.
Section 3: All
Township 12 North, Range 64 West, 6th
P.M.
Section 34: All
2.
An
additional five horizontal wells, for a total of six horizontal wells, in an approximate
1280-acre drilling and spacing unit established by Order No. 535-565 for the
below-described lands, are hereby approved, for the production of oil, gas and
associated hydrocarbons from the Codell Formation:
Township 11 North, Range 64 West, 6th
P.M.
Section 3: All
Township 12 North, Range 64 West, 6th
P.M.
Section 34: All
3.
The
productive interval of the wellbores shall be located no closer than 600 feet
from the unit boundaries and no closer than 600 feet from the productive
interval of a well producing from the same formation, without exception being
granted by the Director.
4.
A maximum of
eight surface locations will be allowed for development of minerals from all
hydrocarbon-bearing formations within the spacing unit.
IT IS FURTHER ORDERED:
1.
The
provisions contained in the above order shall become effective immediately.
2.
The
Commission expressly reserves the 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 1st day of June, 2015, as of May 18, 2015.
OIL AND GAS CONSERVATION COMMISSION
OF THE STATE OF COLORADO
By
Julie Murphy, Secretary