116-6

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 FIELD, MORGAN COUNTY, COLORADO

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CAUSE NO. 116

ORDER NO. 116-6

REPORT OF THE COMMISSION

This cause came on for hearing before the Commission on April 26, 1960, at 10:00 a.m., in the Game Room of the Albany Hotel, Denver, Colorado, after personal service of Notice of Hearing or appropriate waiver thereof, all as required by law, on the application of Petroleum, Inc., a Kansas corporation authorized to do business in the State of Colorado, for an order from the Commission requiring the pooling of all interests in the drilling unit heretofore established by the Commission in the NW¼ of Section 17, Township 4 North, Range 59 West, 6th P.M., Morgan County, Colorado, for the development and operation thereof for the production of gas from the D-1 sand, and on the amendment to said application heretofore filed by said applicant.

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 by its Order No 116-5 of February 1, 1959, the Commission has established a drilling and spacing unit for gas of approximately 160 acres for the D-1 sand formation consisting of the NW¼ of Section 17, Township 4 North, Range 59 West of the 6th P.M., in the Bijou Field, Morgan County, Colorado.

4. That reasonable effort has been made to obtain the voluntary pooling of all interests in the said drilling unit for the development and operation thereof, but that it has not been possible to secure the agreement of all owners of interests in said unit for the voluntary pooling thereof.

5. That Applicant is an "interested person" within the meaning of 100-6-4(6), 1953 Colorado Revised Statutes.

6. That the Petroleum, Inc. No. 1 Williams Well located in the SE¼ NW¼ of Section 17, Township 4 North, Range 59 West, 6th P.M., Morgan County, Colorado, should be the permitted well for the production of gas from the D-1 sand, common source of supply underlying said unit; and that said well is presently producing gas from said D-1 sand common source of supply.

7. That the gas production from the D-1 sand obtained from said drilling unit should be allocated to each tract therein on the basis of the proportion that the number of acres in such tract bears to the total number of acres within said drilling unit; and that the order of/the Commission pooling all interests in said drilling unit and allocating the gas production therefrom on the basis of the proportion that the number of acres in such tract bears to the total number of acres within said drilling unit, is necessary, just and reasonable in order to afford each owner of an interest within said drilling unit the opportunity to recover and receive his just and equitable share of the gas from the common source of supply underlying said drilling unit.

ORDER

NOW, THEREFORE, IT IS ORDERED, that pursuant to the provisions of 100-6-4 of the Oil and Gas Conservation Act of the State of Colorado, all interests in the drilling unit heretofore established by the Commission for the production of gas from the D-1 sand underlying the Northwest Quarter (NW¼) of Section Seventeen (17), Township Four (4) North, Range Fifty-nine (59) West, 6th P.M., Morgan County, Colorado, are hereby pooled for the development and operation of said drilling unit; and the Petroleum, Inc. No. 1 Williams well located in the Southeast Quarter of the Northwest Quarter (SE¼ NW¼) of Section Seventeen (17), Township Four (4) North, Range Fifty-nine (59) West, 6th P.M., Morgan County, Colorado, shall be the permitted well for the production of gas from the D-1 sand within said drilling unit.

IT IS FURTHER ORDERED, that the gas production obtained from the permitted well within said drilling unit shall be allocated to each tract therein on the basis of the proportion that the number of acres in such tract bears to the total number of acres within said drilling unit, and each owner of interest in said tracts in said drilling unit shall be entitled to receive its share of the production from the said well located on said drilling unit which is applicable to his interest in said drilling unit. That portion of the production allocated or applicable to each tract in said unit shall, when produced, be deemed for all purposes to have been produced from such tract by a well drilled thereon.

ORDERED this 26th day of April 1960.

OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO

D.V. Rogers, Secretary