103-1

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 BUCK PEAK FIELD, MOFFAT COUNTY, COLORADO

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CAUSE NO. 103

ORDER NO. 103-1

REPORT OF THE COMMISSION

This cause came on for hearing before the Commission on April 8, 1957, at 10:00 a.m., in the Game Room of the Albany Hotel, Denver, Colorado, after publication of Notice of Hearing as required by law, on the application of the Malco Refineries, Inc., a New Mexico corporation authorized to do business in the State of Colorado, for an order from the Commission establishing eighty-acre drilling and spacing units for the production of oil in the Mancos Shale formation; and Three Hundred Twenty-acre drilling and spacing units for the production of gas in the common sources of supply underlying the Buck Peak Field, Moffat County, Colorado.

FINDINGS

The Commission finds as follows:

1. That due notice of the time, place and purpose of the hearing has been in all respects as required by law.

2. That the Commission has jurisdiction over the subject matter embraced said Notice, and of the parties interested therein, and jurisdiction to promulgate hereinafter prescribed order.

3. That the Tow Creek Zone of the Mancos formation constitutes a common source of supply of oil and gas, and the Morapas Sand of the Mancos formation and Mesaverde formation constitute common sources of supply of gas underlying the following described lands in Moffat County, Colorado, to-wit:

Township 6 North, Range 90 West, 6th P.M.

Sections 22, 23, 24, 25, 26, 27, 34, 35, 36

is referred to as the Buck Peak Field.

4. That in order to prevent waste of oil and gas, as defined in the Oil and Conservation Act, and to prevent the drilling of unnecessary wells, an order should be made establishing eighty(80) [sic] acre drilling and spacing units for the production of oil from the Tow Creek Zone of the Mancos formation, common source supply underlying the Buck Peak Field described above; that said units should be (80) acre drilling and spacing units according to the governmental survey thereof, and that each such unit should be the East Half (E/2) or West Half (W/2) of a quarter section; and that the permitted wells for such drilling units should be located in the Northwest Quarter (NW/4) and the Southeast Quarter (SE/4) of each quarter section, and should be located not closer than Three Hundred Thirty (330) feet the boundary line of such quarter-quarter section.

5. That in order to prevent waste of oil and gas as defined in the Oil and Gas Conservation Act, and to prevent the drilling of unnecessary wells, an order should be made establishing Three Hundred Twenty (320) acre drilling and spacing units for the production of gas from the Morapas Sand of the Mancos formation and the Mesaverde formation, common sources of supply underlying said land, as defined herein; that said units should be Three Hundred Twenty (320) acre drilling and spacing units according to the governmental survey thereof, and that said unit should be the East Half (E/2) or West Half (W/2) of each section; and that the permitted wells for such drilling units should be located in the Southeast Quarter (SE/4) and the Northwest Quarter (NW/4) of each such section, and should be located not closer than Six Hundred Sixty (660) feet from the boundary line of such quarter section.

6. That based on the limited geological and engineering data presently available, it appears that the spacing requested by the petitioner is reasonable and indicates that one well should efficiently and economically drain an area of approximately eighty (80) acres as to oil, and that units of the size and shape hereinabove described are not smaller than the maximum area that can be efficiently drained by one oil well producing from the said Tow Creek Zone of the Mancos formation, common source of supply; and that one oil well should efficiently and economically drain an area of approximately Three Hundred Twenty (320) acres as to gas, and that units of the size and shape hereinabove described are not smaller than the maximum area that can be efficiently drained by one gas well producing from the said Morapas Sand of the Mancos formation and the Mesaverde formation, common sources of supply. However, it is recognized that further development might change the geological and engineering opinion regarding this field.

7. The Commission, upon its own motion or upon petition of any interested party, reserves the right to reconsider this matter when further geological and engineering data becomes available.

ORDER

NOW, THEREFORE, IT IS ORDERED, that the following rules and regulations shall apply hereafter to a well drilled, completed or recompleted in the Tow Creek of the Mancos formation, the Morapas Sand of the Mancos formation and the Mesaverde formation underlying the Buck Peak 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. The following drilling and spacing units shall be and the same are hereby established for the production of oil and gas from the Tow Creek Zone of the Mancos formation, the Morapas Sand of the Mancos formation and the Mesaverde formation, common sources of supply underlying:

Sections Twenty-two (22), Twenty-three (23), Twenty-four (24), Twenty-five (25), Twenty-six (26), Twenty-seven (27), Thirty-four (34), Thirty-five (35) and Thirty-six (36), Township Six (6) North, Range Ninety (90) West of the 6th P.M., Moffat County, Colorado,

and such area shall henceforth be known as the Buck Peak Field.

(a) Eighty (80) acre drilling and spacing units, according to the governmental survey thereof, for the production of oil from the Tow Creek Zone of the Mancos formation, and each such unit shall be the East Half (E/2) or West Half (W/2) of a quarter section. The permitted wells for such drilling units shall be located in the Northwest Quarter (NW/4) and the Southeast Quarter (SE/4) of each quarter section, and shall be located not closer than Three Hundred Thirty (330) feet from the boundary line of such quarter-quarter section.

(b) Three Hundred Twenty (320) acre drilling and spacing units, according to the governmental survey thereof, for the production of gas from the Morapas Sand of the Mancos formation and the Mesaverde formation, and said unit shall be the East Half (E/2) or West Half (W/2) of each section. The permitted wells for such drilling units shall be located in the Southeast Quarter (SE/4) and the Northwest Quarter (NW/4) of each such section, and shall be located not closer than Six Hundred Sixty (660) feet from the boundary line of such quarter section.

IT IS FURTHER ORDERED, that the rules and regulations contained herein become effective forthwith, and henceforth commencement of the drilling of well or wells in the Tow Creek Zone of the Mancos formation, the Morapas Sand of the Mancos formation and the Mesaverde formation, as defined herein, for the purpose of producing oil and gas therefrom, at a location other than authorized by this order, is hereby prohibited.

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 and regulations.

ORDERED this 8th day of April, 1957.

OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO

By Annabel Hogsett, Secretary