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 ROGGEN-SOUTHWEST FIELD, WELD COUNTY, COLORADO

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CAUSE NO. 111

 

ORDER NO. 111-4

 

REPORT OF THE COMMISSION

 

This cause came on for hearing before the Commission on January 18, 1966, at 10 a.m., in Room 132, State Services Building, Denver, Colorado, after publication of Notice of Hearing as required by law, and mailing of copies of the application pursuant to regulations of the Commission, on the application of Nebraska Drillers, Inc., for an order approving a certain Unit Agreement and Unit Operating Agreement attached to said application, and further approving a proposed plan for injection of water into the "D" Sand formation underlying lands comprising the proposed Unit Area; and for an order stating that such Unit Agreement and Unit Operating Agreement constitute the Commission's plan for involuntary unit operations for such lands.

 

FINDINGS

 

The Commission finds as follows:

 

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

 

2.      That the Commission has jurisdiction over the subject matter embraced in said Notice, the voluntary participants to that certain Unit Agreement presented by the applicant, and owners of tracts as indicated in the Agreement submitted as Exhibit "4" to the application, who were not voluntary participants and who were served, as provided for in the Rules of Practice and Procedure of the Commission.

 

3.      That the "D" sand formation underlying the Roggen-Southwest Unit Area, as set forth in the Unit Agreement presented by Applicant, constitutes a common source of supply of oil and gas, and that said Unit Area is composed of the following lands in Weld County, Colorado, to-wit:

 

Township 1 North, Range 63 West, 6th P.M.

 

 

 

Section 1:  NW¼     Section 2:  NE¼

 

 

Township 2 North, Range 63 West, 6th P.M.

 

 

 

Section 23:  SE¼        Section 26:  E½

 

Section 25:  W½         Section 35:  E½

 

Section 36:  W½

 

and that such Unit Area should not be confused with the Roggen-Southwest Unit Area defined in Order No. 111-1 issued October 22, 1957.

 

4.      That Applicant, Nebraska Drillers, Inc., made diligent but unsuccessful attempts to create a voluntary unit operation.

 

5.      That the Unit Agreement and Unit Operating Agreement as presented by Applicant as Exhibits "4" and "5" respectively, are necessary to increase the ultimate recovery of oil and gas from said reservoir; and that the terms provided therein are just and reasonable to all interests contained within the above-defined Roggen-Southwest Unit Area.

 

6.      That the proposed waterflood operation for secondary recovery is necessary to increase the ultimate recovery of oil and gas, and that such operation, pursuant to said Unit Agreement and Unit Operating Agreement will result in an estimated additional recovery of oil and gas with a value in excess of the estimated additional cost incident to conducting such operation.

 

7.      That testimony presented at the hearing stated that said Unit Agreement and Unit Operating Agreement have been approved in writing by those persons who, under the agreement, will be required to pay at least eighty per cent (80%) of the costs of the unit operation, and also by the owners of at least eighty per cent (80%) of the production or proceeds attributable to royalty, overriding royalty, and production payments.

 

ORDER

 

NOW, THEREFORE, IT IS ORDERED:

 

1.      The Unit Agreement and Unit Operating Agreement covering lands in the Roggen-Southwest Unit Area herein defined, which agreements are attached to and a part of the original order of this Commission and on file in the office of the Commission, are approved as being in the public interest for conservation.

 

2.      The "D" Sand reservoir, common source of supply, underlies the following described lands in Weld County, Colorado, to-wit:

 

Township 1 North, Range 63 West, 6th P.M.

 

 

 

Section 1:  NW¼     Section 2:  NE¼

 

 

Township 2 North, Range 63 West, 6th P.M.

 

 

 

Section 23:  SE¼        Section 26:  E½

 

Section 25:  W½         Section 35:  E½

 

Section 36:  W½

 

and such area shall hereafter be known as the Roggen-Southwest Unit Area, but is not to be confused with the Roggen-Southwest Unit Area defined in Order No. 111 - 1.

 

3.      The provisions contained in said Unit Agreement and Unit Operating Agreement as they pertain to:

 

a.

The description of the pool to be so operated;

 

 

b.

The nature of said operation;

 

 

c.

The allocation to the separately owned tracts in the Roggen-Southwest Unit Area of all oil and gas that is produced from said Unit Area and is saved;

 

 

d.

The provision for the credits and charges to be made in the adjustment among the owners in the Roggen-Southwest Unit Area for their respective investments in wells, tanks, pumps, machinery, materials, and equipment contributed to the Unit operations;

 

 

e.

The provision providing how the costs of Unit operations, including capital investments, shall be determined and charged to the separately owned tracts, and how said costs shall be paid, including the provision providing when, how, and by whom the Unit production allocated to an owner who does not pay the share of the cost of Unit operations charged to such owner, or the interest of such owners, may be sold and the proceeds applied to the payment of such costs;

 

 

f.

The provision for financing persons who elect to be carried or otherwise financed, and the reasonable interest charge for such service payable out of such person's share of the production;

 

 

 

g.

The provision for the supervision and conduct of the Unit operations, in respect to which each person shall have a vote with a value corresponding to the percentage of the costs of Unit operations chargeable against the interest of such person; and

 

 

h.

The time when the Unit operations shall commence, and the manner in which, and the circumstances under which the Unit operations shall terminate,

 

are just and reasonable, and are incorporated herein as the Commission’s plan of involuntary unit operations for such lands.

 

4.      The waterflood project for the "D" Sand reservoir of the Roggen-Southwest Unit Area presented by the applicant is approved as being necessary to increase the ultimate recovery from said reservoir.

 

IT IS FURTHER ORDERED, that the rules and regulations contained herein become effective forthwith.

 

ORDERED this 18th day of January 1966.

 

OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO

 

 

By  William R. Smith, Secretary