BEFORE THE OIL & GAS CONSERVATION COMMISSION

                                                  OF THE STATE OF COLORADO

 

 

IN THE MATTER OF THE APPLICATION OF THE SOUTHERN UTE INDIAN TRIBE, d/b/a RED WILLOW PRODUCTION COMPANY, FOR AN ORDER ALLOWING AN OPTIONAL SECOND WELL IN CERTAIN DRILLING AND SPACING UNITS COVERING THE FRUITLAND COAL SEAM FORMATION, IGNACIO-BLANCO FIELD, LA PLATA COUNTY, COLORADO

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            CAUSE NO. 112

 

            Docket No. _________

 

                                                                 APPLICATION

 

            COMES NOW Southern Ute Indian Tribe, d/b/a Red Willow Production Company, by its attorneys Dorsey & Whitney LLP makes application to the Oil and Gas Conservation Commission of the State of Colorado, for an order to permit an optional second well in two existing drilling and spacing units for the Fruitland Coal Seam Formation.  In support thereof the Southern Ute Indian Tribe, d/b/a Red Willow Production Company ("Applicant"), states and alleges as follows: 

            1.         That the Applicant is the owner of numerous leasehold interests in La Plata County, Colorado, located within the area requested for spacing. 

            2.         This Application is submitted to this Commission in accordance with the terms of the Memorandum of Understanding dated August 22, 1991 between the Bureau of Land Management (“BLM”) and this Commission and separate Memorandum of Understanding dated August 22, 1991 between the Bureau of Indian Affairs, the BLM and the Southern Ute Indian Tribe.  The Southern Ute Indian Tribe owns certain surface interests and mineral interests underlying the subject land.

            3.         That the Applicant is requesting that two (2) wells be permitted in the existing drilling and spacing units of 320 acres for the Fruitland Coal Seam Formation covering the following described lands in La Plata County, Colorado, to wit:

 

                        Township 33 North, Range 6 West, N.M.P.M.

                        Section 6:   W/2

                        Section 7:   W/2

            4.         That the units of 320 acres with two (2) wells located thereon are expected to efficiently drain the Fruitland Coal Seam Formation which is the common source of supply in this area and such spacing is not smaller than the maximum area that can be efficiently and economically drained by two wells from said formation. 

            5.         That lands requested have heretofore been subject to spacing orders for production from the Fruitland Coal Seam Formations pursuant to, among other orders, Order No. 112-60, 61 and 62.  Wells in Township 33 North are to be located in the center of the NW/4 and the SE/4 of the section and no closer than 990 feet to any outer boundary of the unit, nor closer than 130 feet to any interior quarter section line.  Applicant proposes that the second well in each 320-acre unit be drilled, completed or recompleted in the operator's discretion in the center of the SW/4 of Section 6 and the NW/4 of Section 7 with a tolerance in any direction of 200 feet for geological, topographic or surface location concerns. 

            6.         That Orders emanating from Cause No. 112 have provided for 320-acre drilling and spacing units for the production of oil and/or gas from the Fruitland Coal Seam Formation.  Said units shall be remain as previously established with the permitted wells to be located as provided in paragraph 5.  The drilling and spacing units shall be coincident with any existing drilling and spacing units for the Fruitland Formation. 

            7.         That the Director may without further notice and hearing approve exceptions to the permitted well locations due to topography or surface hazards.

            8.         That allowing two (2) Fruitland Coal Seam wells within the existing spacing units is expected to economically and efficiently drain the Fruitland Coal Seam Formation and protect the correlative rights of all parties.  The drilling of unnecessary wells will be prevented and the waste will therefore be avoided all in accordance with the Colorado statutes and the rules and regulations of this Commission and the BLM. 

            9.         That granting of the relief requested in this Application will have no adverse impacts on the public health, safety, welfare or the environment.  The rules and regulations of the Commission together with the extensive environmental monitoring programs administered by the Applicant are sufficient to adequately address impacts to the environment and protect the public health, safety and general welfare.

            10.       Exhibit A attached hereto and made part hereof is the list of the names of "Owners" required to be notified in accord with Commission Rules, including within the areas covered by this application.  To the best of Applicant's knowledge and belief, Exhibit A contains the names of all such owners. 


            WHEREFORE, Applicant respectfully requests that this matter be set for hearing, that notice thereof be given as required by law and that upon such hearing this Commission enter its order: 

            A.        Establishing that two (2) Fruitland Coal wells may be completed in the 320-acre drilling and spacing units for oil and/or gas from the Fruitland Coal Seam Formation underlying the lands set forth in paragraph 3 with the second well being an optional well in the discretion of the operator.  The permitted wells shall be located in the center of the quarter section as described in paragraph 5 above with a tolerance of 200 feet in any direction subject to the Director approving exceptions for the permitted well location in his discretion. 

            B.         For such other findings and orders as the Commission may deem proper or advisable in the premises. 

            DATED this 24th day of May, 2004.   

 

Respectfully submitted,

 

SOUTHERN UTE INDIAN TRIBE, D/B/A

RED WILLOW PRODUCTION COMPANY

 

 

 

By:                                                                                    

Michael J. Wozniak

Dorsey & Whitney LLP

Attorneys for Applicant

370 17th Street, Suite 4700

Denver, Colorado 80202

(303) 629-3400

 

Applicants' Address:

 

P. O. Box 737

Ignacio, CO  81137

 

VERIFICATION

 

 

STATE OF COLORADO       )

                                                ) ss.

COUNTY OF LA PLATA      )

 

            Rex Richardson, of lawful age, being first duly sworn upon oath, deposes and says that he is the Land and Acquisition Manager for Red Willow Production Company and that he has read the foregoing Application and that the matters therein contained are true to the best of my knowledge, information and belief. 

 

 

                                                                        _________________________________

 

           

     Subscribed and sworn to before this ____ day of May, 2004. 

 

            Witness my hand and official seal.

            My commission expires: 

 

 

                                                                                    ______________________________

                                                                                    Notary Public


                                                                     EXHIBIT A

                                                          INTERESTED PARTIES

 

IN THE MATTER OF THE APPLICATION OF THE SOUTHERN UTE INDIAN TRIBE, d/b/a RED WILLOW PRODUCTION COMPANY, FOR AN ORDER ALLOWING AN OPTIONAL SECOND WELL IN CERTAIN DRILLING AND SPACING UNITS COVERING THE FRUITLAND COAL SEAM FORMATION, IGNACIO-BLANCO FIELD, LA PLATA COUNTY, COLORADO

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            CAUSE NO. 112

 

            Docket No. _________

 

 

 

Southern Ute Indian Tribe

Tribal Annex Building

116 Moache Drive

Ignacio, CO 81137

Attn:  Ms. Barbara Wickman

 

Bureau of Indian Affairs

Southern Ute Agency

383 Ute Road

BIA Bldg. No. 1

Ignacio, CO  81137

Attn:  Ken Young

 

Department of the Interior

Bureau of Land Management

701 Camino Del Rio

Durango, CO  81301

Attn:  Helen Mary Johnson

 

LaPlata County Assessor

P. O. Box 3339

Durango, CO  81302

 

Gosney & Sons

PO Box 367

Bayfield, CO 81122

 

BP America

380 Airport Road   

Durango, CO 81301

 

Donald E. Dayhuff & Gloria J. Day

6888 Pierson St,

Arvada, CO  80004

 

Patricia McDonald Chandler Trust 9/12/97

 

Mitchell L. Solich

2215 S. Field Way

Lakewood, CO  80227-2334

 

Collis P. Chandler

22 High Meadow Dr.

Dillon, CO  80435