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 "D" SAND OF THE BIJOU AREA, MORGAN COUNTY, COLORADO

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CAUSE NO. 116

 

ORDER NO. 116-3

 

REPORT OF THE COMMISSION

 

This cause came on for hearing before the Commission on August 19, 1958, at 10 a.m., in the Green Room of the Albany Hotel, Denver, Colorado, after publication of Notice of Hearing as required by law on file Commission's own motion to determine the extent of the common source, or sources, of supply; and to consider measures to prevent the waste of oil and gas from the "D" sand formation of the Bijou Area, Morgan County, Colorado.

 

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, and of the parties interested therein, and jurisdiction to promulgate the hereinafter prescribed order.

 

3.      That, based on present geologic and engineering testimony, it appears that more than one common source of supply underlies the Bijou Area, in the "D" sand formation; however, since additional development wells are being drilled at a constant rate, it is advisable to consider all producible wells in the Bijou Area under Cause No. 116 until pool limits are more specifically defined.  Said Bijou Area should include the following described lands in Morgan County, Colorado, to-wit:

 

Township 4 North, Range 59 West, 6th P.M.

 

 

Section 5:  All

Section 8:  All

Section 6:  All

Section 17:  N½

Section 7:  All

Section 18:  N½

 

 

Township 4 North, Range 60 West, 6th. P. M.

 

 

 

Section 1:  All

 

Section 2:  E½, E½ W½

 

Section 11:  E½

 

Section 12:  All

 

Section 13:  N½

 

Section 14:  NE¼

 

 

 

Township 5 North, Range 59 West, 6th P.M.

 

 

 

Section 31:  All

 

 

Township 5 North, Range 60 West, 6th P.M.

 

 

Section 26:  S½

Section 34:  E½

Section 27:  SE¼

Section 35:  All

 

4.      That in order to prevent waste, and to prevent the drilling of unnecessary wells, an order should be made establishing drilling and spacing units for oil consisting of approximately forty (40) acres, according to the governmental survey thereof; and that the permitted well for each such drilling unit should be located in the center of each quarter-quarter section in the governmental survey; and that a tolerance of One Hundred (100) feet in any direction from the prescribed location should be permitted to avoid surface hazards and obstructions; and that no intention to drill a well should be approved until all owners of interest within a given drilling and spacing unit have pooled their interests.

 

5.      That in order to prevent waste and protect correlative rights, and to prevent the escaping, blowing, and releasing of gas in an excessive or unreasonable amount from wells capable of producing both oil and gas, the maximum daily production of gas from any one producible well completed in the "D" sand formation underlying said Bijou Area should not exceed an approximate volume of 150,000 cubic feet; provided, however, that no gas should be released directly or indirectly into the open air from any gas well.  A "gas well", as used herein, should mean any well which has a producing gas-oil ratio of 20,000 cubic feet per barrel, or greater.

 

6.      That when more reservoir information is available, especially as to pool limits and reserves of oil and gas, and upon application of any operator, consideration should be given by the Commission to increasing the gas allowable.

 

7.      That negotiations are now under way for development of a gas market for the Bijou Area, and it appears that gas-handling facilities will be installed in the near future, and that gas reserves should be protected until such installations are made.

 

8.      That monthly gas-oil-ratio tests should be conducted, and that the next bottom-hole-pressure survey should be made in October, 1958.

 

ORDER

 

NOW, THEREFORE, IT IS ORDERED, that the following rules and regulations shall apply hereafter to a well drilled, completed or recompleted in the "D" sand formation underlying the Bijou Area 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.    Approximately Forty (40) acre drilling and spacing units for oil shall be, and the same are hereby established for the "D" sand formation underlying the following described lands in Morgan County, Colorado, to-wit:

 

Sections Five (5) Six (6), Seven (7), Eight (8) and the North Half (N½ of Sections Seventeen (17) and Eighteen (18), Township Four (4) North, Range Fifty-nine (59) West of the 6th P.M;

Section One (1); East Half (E½) and East Half of the West Half (E½ W½) of Section Two (2); East Half (E½) of Section Eleven (11); all of Section Twelve (12); North Half (N½) of Section Thirteen (13), and Northeast Quarter (NE¼) of Section Fourteen (14), Township Four (4) North, Range Sixty (60) West of the 6th P.M.;

 

Section Thirty-one (31), Township Five (5), North, Range Fifty-nine (59) West of the 6th P.M.; and

 

South Half (S½) of Section Twenty-six (26); Southeast Quarter (SE¼) of Section Twenty-seven (27); East Half (E½) of Section Thirty-four (34), and all of Section Thirty-five (35), Township Five (5) North, Range Sixty (60) West of the 6th P.M.,

 

and such area shall henceforth be known as the Bijou Area.

 

Rule 2.    Said units shall consist of approximately Forty (40) acres, and the permitted well for each such drilling unit shall be located in the center of each quarter-quarter section in the governmental survey, and that a tolerance of One Hundred (100) feet in any direction from the prescribed location shall be permitted to avoid surface hazards and obstructions; and no intention to drill a well shall be approved until all owners of interest within a given drilling and spacing unit have pooled their interests.

 

Rule 3.    (a)  That in order to prevent waste and protect correlative rights, and to prevent the escaping, blowing, and releasing of gas in an excessive or unreasonable amount from wells capable of producing both oil and gas, the maximum daily production of gas from any one producible well completed in the "D" sand formation underlying said Bijou Area shall not exceed an approximate volume of One Hundred Fifty Thousand (150,000) cubic feet; provided, however, that no gas shall be released directly or indirectly into the open air from any gas well.  A "gas well", as used herein, shall mean any well which has a producing gas-oil ratio to Twenty Thousand (20,000) cubic feet per barrel or greater.

 

               (b)  In order that the operators may produce any one lease in the most efficient manner possible, the gas allowable for any well or combination of wells on any given lease may be transferred and produced by any other well or combination of wells on the same lease.

 

               (c)  Under and over production of oil, as determined by Rule 4 hereof, shall be adjusted on a monthly basis.  Underproduction of oil during any one (1) month may be made up only during the month immediately following; and any overproduction of oil obtained during any one (1) month shall be made up during the month immediately following.  The production of gas from any lease in excess of five (5) days’ allowable for said lease, shall be considered a violation.

 

Rule 4.    That operators and owners of wells capable of producing from the "D" sand formation of the Bijou Area, as defined in Rule 1 hereof, shall make a monthly gas-oil-ratio test of each of his producing wells.  Such tests shall be taken between the tenth (10th) and twentieth (20th) of each month, and the results of such tests shall be submitted to the Commission on or before the twenty-fifth (25th) day of each month.  The tests shall be the basis for calculating the allowable to be produced during the next month following the test.  Each well shall be produced at its normal stabilized rate for a period of forty-eight (48) consecutive hours, and the gas-oil ratio shall be computed on the basis of the measurement of oil and gas during the last twenty-four (24) hours of said forty-eight (48) hour period.  A schedule shall be submitted to the office of the Commission and offset operators prior to testing, showing the wells and respective dates of tests.  The volume of gas measured shall be reported in units of cubic feet at a base pressure of 15.025 psia, and a base temperature of 60° Fahrenheit.

 

Rule 5.    A determination of datum reservoir pressure shall be made during the month of October, 1958, and as may be otherwise ordered by the Commission.  All wells capable of producing from said "D" sand formation shall be shut in by 9:00 a.m. on October 1, 1958, and shall remain shut in [sic] until completion of the survey.  Datum reservoir pressure shall be determined after the entire field has been shut in for a period of at least twenty-four (24) hours, and such pressure shall be measured with a bomb at a datum of Seventeen Hundred and Twenty (1720) feet below sea level.  The results of said survey shall be reported to the Commission on or before October 15, 1958.

 

Rule 6.    Operators and owners of wells producing from the "D" sand formation shall file with the Commission a monthly report of production by wells, covering the month next preceding the date of filing, on or before the twenty-fifth (25th) day of each month.

 

IT IS FURTHER ORDERED, that the provisions of this order shall apply to all operators and owners of wells capable of producing from the "D" sand formation underlying the Bijou Area, and shall remain in effect unless otherwise authorized by the Commission.

 

IT IS FURTHER ORDERED, that this order shall become effective on August 21, 1958.

 

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, rules and regulations.

 

ORDERED this 19th day of August 1958.

 

OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO

 

 

By 

Annabel Hogsett, Secretary