IN THE MATTER OF GENERAL RULES AND REGULATIONS WITH RESPECT TO THE CONSERVATION OF OIL AND GAS IN THE STATE OF COLORADO, AND RULES OF PRACTICE AND PROCEDURE PERTAINING THERETO AND IN PARTICULAR WITH REFERENCE TO RULE 323

BEFORE THE OIL AND GAS CONSERVATION COMMISSION

OF THE STATE OF COLORADO

IN THE MATTER OF THE PROMULGATION AND ESTABLISHMENT OF FIELD RULES TO GOVERN OPERATIONS IN THE PLUM BUSH CREEK FIELD, WASHINGTON COUNTY, COLORADO

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CAUSE NO. 57

ORDER NO. 57-9

REPORT OF THE COMMISSION

This cause came on for hearing before the Commission on January 21, 1985 at 9:00 a.m., in Room 110 State Centennial Building, 1313 Sherman Street, Denver, Colorado, after giving Notice of Hearing as required by law, on the application of Bert A. Lear for an order establishing 40-acre drilling and spacing units for the production of oil, gas and associated hydrocarbons from the "J" Sand underlying certain lands in Washington County, Colorado.

FINDINGS

The Commission finds as follows:

1. Bert A. Lear, 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, the Commission should enter an order establishing 40-acre drilling and spacing units for the production of oil, gas and associated hydrocarbons from the "J" Sand underlying the following described lands in Washington County, Colorado:

Township 2 South, Range 56 West, 6th P.M.

Section 25: NW1/4

Section 26: NE1/4

5. In order to prevent the waste of oil and gas, as defined by law, to protect 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 40-acre drilling and spacing units for the production of oil, gas and associated hydrocarbons from the "J" Sand underlying the lands defined herein and said units should consist of 40-acres [sic], more or less, and consist of a quarter quarter section according to the governmental survey. The permitted well should be at a location in the center of each 40-acre unit with a tolerance of 200 feet for topographical or other reasons. The well permitted to be drilled in the unit consisting of the NE1/4NW1/4 Section 25, Township 2 South, Range 56 West, 6th P.M. should be considered the permitted well for the unit upon which it is located.

6. All available geological and engineering data concerning said "J" Sand indicate that one well will efficiently and economically drain an area of approximately 40-acres [sic], and that the drilling unit of the size and shape hereinabove described is not smaller than the maximum area that can be efficiently and economically drained by one well producing from said "J" Sand.

ORDER

NOW, THEREFORE, IT IS ORDERED, that the following rules and regulations shall apply hereafter to wells drilled, completed, or recompleted in the "J" Sand underlying certain lands in the Plum Bush Creek 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. Forty-acre (40) drilling and spacing units shall be and the same are hereby established for the production of oil, gas and associated hydrocarbons from the "J" Sand underlying the following described lands in Washington County, Colorado, to-wit:

Township 2 South, Range 56 West, 6th P.M.

Section 25: NW1/4

Section 26: NE1/4

Rule 2. Said units shall consist of 40-acres [sic], more or less, and consist of a quarter quarter section according to the governmental survey. The permitted well to be drilled in the unit consisting of the NE1/4 NW1/4 Section 25, Township 2 South, Range 56 West, 6th P.M. shall be considered the permitted well for the unit upon which it is located.

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 19th day of February, 1985, as of January 21, 1985.

OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO

By Frank J. Piro, Secretary