BEFORE THE OIL AND GAS CONSERVATION COMMISSION

OF THE STATE OF COLORADO

IN THE MATTER OF THE APPLICATION OF WILLIAMS PRODUCTION RMT COMPANY FOR AN ORDER ESTABLISHING SPACING AND WELL LOCATION RULES FOR THE WILLIAMS FORK FORMATION OF THE MESAVERDE GROUP FOR CERTAIN DESCRIBED LANDS IN THE RULISON, PARACHUTE AND GRAND VALLEY FIELD AREAS, GARFIELD COUNTY, COLORADO

CAUSE NO.

DOCKET NO.

APPLICATION

COMES NOW Williams Production RMT Company ("Applicant"), a Delaware corporation, by its attorneys, Gorsuch Kirgis LLP, and makes application to the Oil and Gas Conservation Commission of the State of Colorado for an order establishing spacing rules applicable to the drilling and producing of wells from the Williams Fork Formation of the Mesaverde Group covering certain described lands in the Rulison, Parachute and Grand Valley Field areas, Garfield County, Colorado and in support of its application states and alleges as follows:

1. That Applicant is a corporation duly authorized to conduct business in the State of Colorado.

2. That Applicant owns a leasehold interest in the following described lands (both the surface estate and mineral estate of which are owned by the United States of America):

Township 6 South, Range 94 West, 6th P.M.

Section 2: S/2SW/4, NE/4SW/4, SW/4SE/4

Section 3: S/2S/2, NE/4SE/4, NW/4SW/4

Section 7: SE/4

Section 8: S/2

Section 9: ALL

Section 10: N/2, SW/4, S/2SE/4

Section 11: E/2, N/2NW/4, SW/4SW/4

Section 12: W/2W/2, SE/4NW/4

Section 13: N/2NW/4

Section 16: W/2NW/4

Section 17: N/2, SE/4, N/2SW/4, SE/4SW/4

Section 18: W/2, NE/4, NE/4SE/4

Section 19: N/2, SE/4, N/2SW/4, SE/4SW/4

Section 20: E/2NW/4, N/2NE/4

Section 21: N/2NW/4

Township 6 South, Range 95 West, 6th P.M.

Section 16: S/2SW/4

Section 17: SE/4SE/4

Section 20: S/2, NE/4NE/4, S/2NE/4

Section 21: ALL

Section 26: NW/4, N/2SW/4

Section 27: N/2, N/2S/2, SE/4SE/4

Section 28: NE/4, N/2SE/4, W/2W/2

Section 29: ALL

Section 30: S/2, NE/4, S/2NW/4

Section 31: N/2, SW/4, N/2SE/4, SW/4SE/4

Section 32: NW/4, N/2NE/4, SW/4NE/4

Section 33: NW/4NW/4, SE/4NW/4

Township 6 South, Range 96 West, 6th P.M.

Section 19: N/2, SE/4

Section 20: W/2SW/4

Section 24: SE/4

Section 25: ALL

Section 26: SE/4, S/2NE/4, S/2NW/4, NE/4NW/4, SE/4SW/4

Section 27: SE/4SE/4

Section 29: NW/4NW/4, N/2SW/4, SW/4SW/4

Section 30: NE/4

Section 32: NW/4NW/4, S/2S/2

Section 33: S/2SW/4

Section 34: S/2NE/4, NE/4NE/4

Section 35: N/2, N/2S/2, SE/4SW/4, SW/4SE/4

Section 36: N/2, E/2SE/4

Township 7 South, Range 96 West, 6th P.M.

Section 1: NE/4NE/4

Section 3: S/2, NW/4

Section 4: S/2, NW/4, S/2NE/4, NW/4NE/4

Section 5: SE/4

Section 8: E/2

Section 9: N/2

Section 10: N/2, SE/4

Section 11: W/2, W/2E/2, SE/4NE/4

Section 14: NE/4, W/2, NW/4SE/4

Section 15: S/2, NE/4

Township 7 South, Range 95 West, 6th P.M.

Section 6: NW/4NW/4

(hereinafter “Federal Application Lands”)

3. That the Federal Application Lands, pursuant to the Commission’s Order Nos. 139‑40, 440‑25, 479‑12 and 510‑9 in Cause Nos. 139, 440, 479 and 510 (hereinafter “Federal Application Lands Order”), were approved for the drilling of wells for the production of gas and associated hydrocarbons from the Williams Fork Formation of the Mesaverde Group at the equivalent of one (1) well per ten acres. Such Federal Application Lands Order provided inter alia that the permitted downhole location for each new Williams Fork Formation well could be located anywhere within a given drilling and spacing unit but no closer than 100 feet from the boundaries of the that unit without exception being granted by the Director; provided however, that as to any well within a given drilling and spacing unit of the Federal Application Lands which abutted or cornered lands that had not at the time of the drilling permit application also been approved for the drilling of Williams Fork wells at that same equivalent of one (1) well per ten acres, the well in that drilling and spacing unit could be located no closer than two hundred (200) feet from the boundary of the drilling unit without exception being granted by the Director. The Federal Application Lands Order further provided that as to Federal Application Lands which were unspaced, the ten acre density Williams Fork Wells to be drilled thereon could be located downhole anywhere upon the Federal Application Lands but no closer than 100 feet from the boundaries of the lease line unless such lease line abutted or cornered lands that had not at the time of the drilling permit application also been approved for the drilling of at that same equivalent of one (1) well per ten acres, in which event the well could be drilled no closer than 200 feet from the lease line.

4. That Applicant also owns a leasehold interest in the following described lands:

Township 6 South, Range 94 West, 6^th P.M.

Section 10: N/2SE/4

Section 11: S/2NW/4, N/2SW/4, SE/4SW/4

Section 14: E/2

Section 15: ALL

Section 16: S/2, W/2NE/4, E/2NW/4

Section 17: SW/4SW/4

Section 18: SE/4SE/4, W/2SE/4

Section 20: S/2NE/4, E/2SE/4, W/2W/2

Section 21: N/2NE/4, SW/4NE/4, S/2NW/4, S/2

Section 22: N/2, SW/4, W/2SE/4

Section 27: S/2NW/4, NE/4NW/4, W/2SW/4, NW/4NE/4

Section 28: NE/4, N/2NW/4, E/2SE/4

Section 29: N/2NE/4, NE/4NW/4

Township 6 South, Range 95 West, 6^th P.M.

Section 26: S/2SW/4

Section 27: S/2SW/4, SW/4SE/4

Section 28: S/2SE/4, E/2W/2

Section 31: SE/4SE/4

Section 32: SE/4NE/4, N/2S/2, S/2SW/4, SW/4SE/4

Section 33: E/2, SW/4, SW/4NW/4, NE/4NW/4

Section 34: ALL

Section 35: N/2NW/4, SW/4NW/4, NW/4NE/4

Township 7 South, Range 95 West, 6^th P.M.

Section 5: NW/4NW/4

Section 6: N/2NE/4, SE/4NW/4, SW/4NE/4, NE/4NW/4

Township 6 South, Range 96 West, 6^th P.M.

Section 17: E/2

Section 20: E/2, NW/4, E/2SW/4

Section 23: SW/4SW/4

Section 27: NE/4NE/4, S/2NE/4, N/2SE/4, SW/4SE/4, S/2SW/4

Section 28: SW/4, S/2SE/4, S/2NW/4

Section 29: NE/4, NE/4NW/4, E/2SE/4

Section 31: S/2NE/4, N/2SE/4

Section 32: N/2NE/4, SW/4NE/4, NW/4SE/4, S/2NW/4, N/2SW/4

Section 33: N/2NW/4, SE/4NW/4, N/2NE/4, SW/4NE/4

Section 34: SE/4, E/2SW/4, SW/4SW/4, N/2NW/4, SE/4NW/4, NW/4NE/4

Section 35: SW/4SW/4, SE/4SE/4

Section 36: SW/4, W/2SE/4

Township 7 South, Range 96 West, 6^th P.M.

Section 1: NW/4, SE/4, S/2NE/4, NW/4NE/4, N2/SW/4, SE/4SW/4

Section 2: W/2, NE/4, W/2SE/4, NE/4SE/4

Section 3: NE/4

Section 4: NE/4NE/4

(hereinafter "Fee Application Lands")

5. That the Fee Application Lands, pursuant to the Commission’s Orders Nos. 139‑38, 440‑23, 479‑11, 495-3 and 510‑8 in Cause Nos. 139, 440, 479, 495 and 510 (hereinafter “Fee Application Lands Order”), were approved for the drilling of wells for the production of gas and associated hydrocarbons from the Williams Fork Formation of the Mesaverde Group at the equivalent of one (1) well per ten acres. The Fee Application Lands Order provided that the permitted downhole location for each new Williams Fork Formation well drilled upon the Fee Application Lands should be located anywhere within a given drilling and spacing unit but not closer than 100 feet from the boundary of a drilling unit without exception being granted by the Director of the Oil and Gas Conservation Commission, provided that no new Williams Fork Formation well could be drilled with a downhole location closer than two hundred feet from the exterior boundaries of the Application Lands (with the exception of the ten acre pilot lands contiguous to the Application Lands) without exception being granted by the Director of the Oil and Gas Conservation Commission.

6. That because the Fee Application Lands abut or corner the Federal Application Lands in many places, it is appropriate in cases where this occurs to allow the permitted downhole location for each new William Fork Formation well drilled on the Fee Application Lands to be located anywhere within a given drilling and spacing unit but not closer than 100 feet from the boundary of the drilling unit (without exception being granted by the Director of the Oil and Gas Conservation Commission). It is also appropriate to amend the Fee Application Lands Order to allow future wells to be located as close as 100 feet from the boundary of the drilling and spacing unit within the Fee Application Lands whenever the lands abutting and cornering such Fee Application Lands have been approved for the drilling of Williams Fork Wells at the equivalent of one (1) well per ten acres. Therefore, the setback rules under the Fee Application Lands Order should be amended to be the same as those contained within the Federal Lands Application Order.

7. The amendment of such downhole well location rules will not promote waste; will not violate correlative rights and will assure the greatest ultimate recovery of gas and associated hydrocarbon substances from the reservoir.

8. That the names and addresses of the interested parties according to the information and belief of the Applicant are set forth in Exhibit A attached hereto and made a part hereof.

WHEREFORE, Applicant respectfully requests that this matter be set for hearing in January, 2004, that notice be given as required by law and that upon such hearing this Commission enter its order consistent with Applicant's proposals as set forth above.

Dated this _______ day of November, 2003.

GORSUCH KIRGIS LLP

By:

William A. Keefe

Tower 1, Suite 1000

1515 Arapahoe Street

Denver, Colorado 80202

Mark Bean, County Planner

109 8th Street

Glenwood Springs, Colorado 81601

Tom Brown, Inc.

Attn: Mr. Dave Davenport, Division Land Manager

555 17th Street, Suite 1850

Denver, CO 80202-3918

Ms. Celeste C. Grynberg

c/o Grynberg Petroleum Company

5299 DTC Boulevard

Prentice Point Building, Suite 500

Greenwood Village, CO 80111

Carbon Energy Corporation (USA)

Attn: Mr. Ronald A. Bookman, Landman

1700 Broadway, Ste. 1150

Denver, CO 80290

Mr. and Mrs. Howard Orona

P.O. Box 1

Parachute, CO 81635

Firetrucks Northwest, Inc.

Attn: Mr. Joseph F. Feeley, Jr., President

0808 County Road 215

Parachute, CO 81635

Battlement Mesa Service

P.O. Box 6006

Battlement, CO 81636

Puckett Land Company

Attn: Mr. Robert Puckett

5460 South Quebec St., # 250

Greenwood Village, CO 80111

Petroleum Development Corporation

Attn: Mr. Eric Stearns, Vice-President

P.O. Box 26

Bridgeport, West Virginia 26330

Bureau of Land Management

Attention: Mr. Duane Spencer

2850 Youngfield Street

Lakewood, Colorado 80215

Bureau of Land Management

Attn: Mr. Wayne Bankert

2815 "H" Road

Grand Junction, CO 81506

ExxonMobil Oil Corporation

and Exxon Mobil Corporation

Attn: Mr. Brent Patterson

16825 Northchase Drive, Suite 200

Houston, TX 77060

ExxonMobil Oil Corporation

and Exxon Mobil Corporation

Attn: Mr. Christopher H. Dunbar

396 West Greens Road

Houston, TX 77067

Unocal Corporation

Attn: Mr. Richard Brammer and Ms. Susan Alvillar

546 Main Street # 404

Grand Junction, CO 81501

Yates Petroleum Corporation

Yates Drilling Company

ABO Petroleum Corporation

MYCO Industries, Inc.

105 S. Fourth St.

Artesia, NM 88210

Chevron U.S.A. Inc.

Attn: Mr. J.T. (Tom) Schmid Jr.

Room S-1037

P.O. Box 36366

Houston, TX 77236-6366

EnCana Oil & Gas (USA) Inc.

Attention: Mr. Douglas Jones

950 17th Street, Suite 2600

Denver, CO 80202-2828

Occidental Oil Shale, Inc.

Attention: Ms. Vicki Hollub

P.O.Box 27570

Houston, TX 77227-7570

Mr. Ivo E. Lindauer

269 Lodgepole Circle

Parachute, CO 81635

Mr. Sidney R. Lindauer and Mr. Sidney R. Lindauer, Trustee of the Sidney and Ruth Lindauer Family Trust

P.O.Box 626

Parachute, CO 81635

Union Pacific Real Estate Division

Attn: Mr. Bill Ince

1800 Farnam Street

Omaha, Nebraska 68102

Vera Mahaffey

2029 N. 9th

Grand Junction, CO 81501

Donna Joyce Mahaffey

P.O. Box 492263

Redding, CA 96049-2263

Averyl I. Mahaffey

1205 N. University

Spokane WA 99206

Edra L. Piepho

849 Georgetown Place

San Jose, CA 95126-3164

Linda C. Mahaffey

9500 Harritt Rd. 126

Lakeside, CA 92040

Barbara J. Hoffman

1188 Noria St.

Laguna Beach, CA 92651-3532

Forrest C. & Eva M. Mahaffey

659 W. Redondo Pl - NBU 4414

Green Valley, AZ 85614

Phillip R. Mahaffey

9600 E. Faith Avenue

Hereford, AZ 85615

Margo L. Johnson

1702 Edgar Street

Rock Springs, WY 82901

Maureen Mahaffey Frederick

216 30 Rd.

Grand Junction, CO 81503

Margaret Mahaffey Beckner

613 Northwind Ln.

Stockbridge, GA 30281-6255

Merrill D. Mahaffey

4 Puerto Ct.

Santa Fe, NM 87508

Charles A. Shear, Trustee of the

Mahaffey Brothers Trust

P.O. Box 426

Collbran, CO 81624

La Garita Land & Mineral Company Ltd.

P.O. Box 1697

Boulder, CO 80306

Town of Parachute

P.O. Box 100

Parachute, CO 81635

Union Pacific Real Estate Division

Attn: Mr. Bill Ince

1800 Farnam Street

Omaha, Nebraska 68102

Colorado Department of Transportation

222 South 6th Street, Room 100

Grand Junction, CO 81501

Attn: Ms. Mike Verketis