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BEFORE THE OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO
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IN THE MATTER THE PROMULGATION AND ESTABLISHMENT OF FIELD RULES TO GOVERN OPERATIONS IN THE RULISON FIELD, GARFIELD COUNTY, COLORADO |
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CAUSE NO. 139
ORDER NO. 139-44 |
This cause came on for hearing before the Commission at 9:00 a.m. on January 10, 2005 in Suite 801, 1120 Lincoln Street, Denver, Colorado on the application of Tom Brown, Inc. (“TBI”) for an order to increase the number of wells which can be optionally drilled into and produced from the Williams Fork Formation for certain lands in Township 7 South, Ranges 95 and 96 West, 6th P.M., the equivalent of one Williams Fork Formation well per 20 acres, with each well located downhole in the established drilling and spacing unit, no closer than 200 feet from the boundaries of the unit and no closer than 400 feet from any existing Williams Fork Formation well without exception being granted by the Director of the Oil and Gas Conservation Commission.
The Commission finds as follows:
1. On July 1, 1997, the Commission issued Order No. 139-31, which among other things, allowed the drilling of additional wells up to sixteen (16) on the established 640-acre drilling and spacing units, for the production of gas and associated hydrocarbons from the Williams Fork Formation of the Mesaverde Group, with the permitted well to be located no closer than 400 feet from the outer boundaries of the unit and no closer than 800 feet from any well in the same formation, for the below-listed lands:
Township 7 South, Range 95 West, 6th P.M.
Section 30: All
Section 31: All
Township 7 South, Range 96 West, 6th P.M.
Section 25: All
Section 36: All
2. On November 19, 2004, corrected on December 2, 2004, TBI, by its attorney, filed with the Commission a verified application for an order to increase the number of wells which can be optionally drilled into and produced from the Williams Fork Formation for the above-described lands, the equivalent of one Williams Fork Formation well per 20 acres, with each well located downhole in the established drilling and spacing unit, no closer than 200 feet from the boundaries of the unit and no closer than 400 feet from any existing Williams Fork Formation well without exception being granted by the Colorado Oil and Gas Conservation Commission. TBI commits that wells to be drilled in these lands will be drilled from the surface either vertically or directionally from no more than one well pad located on a given quarter quarter section unless exception is granted by the Director of the Colorado Oil and Gas Conservation Commission.
3. Testimony and exhibits presented at the administrative hearing showed that the Bureau of Land Management (“BLM”) is the major surface owner in the area and that that TBI, Daybreak Realty, LLC and Larry and Karen Klebold own the remaining surface.
4. Testimony and exhibits presented at the administrative hearing showed the majority of the minerals in the area are owned by the BLM and leased by TBI. Additional testimony indicated that the mineral leases in all sections have been communitized.
5. Testimony and exhibits presented at the administrative hearing indicated that the Williams Fork Formation, a subsection of the Mesaverde Group, is six hundred (600) to eight hundred (800) feet thick in the basin, and that the Williams Fork Formation consists of numerous fluvial deposits that are discontinuous and heterogeneous in nature, with sand bodies that have an average lateral extent of five hundred and twenty five (525) feet.
6. Testimony and exhibits presented at the administrative hearing showed that the original gas in place varies from 60 BCF to 120 BCF per section. Additional testimony showing natural and induced fractures and elliptical drainage indicated that additional wells are needed to drain the Williams Fork Formation.
7. Testimony and exhibits presented at the administrative hearing showed an additional 11.2 BCF of gas will be recovered per well drilled on 20 acres, with an economic recovery of .7 BCF per well or higher.
8. The above-referenced exhibits and testimony show that the proposed density will allow more efficient drainage, will prevent waste, will not violate correlative rights and will assure a greater ultimate recovery of gas and associated hydrocarbons.
9. No protests to the application have been filed with the Commission or the Applicant.
10. Tom Brown, Inc. agrees to be bound by oral order of the Commission.
11. The Hearing Officer should recommend to the Commission at its hearing on January 10, 2005 that the application be approved.
NOW, THEREFORE, IT IS ORDERED, that Order No. 139-31 is hereby amended to allow the number of wells which can be optionally drilled into and produced from the Williams Fork Formation for the below-listed lands, the equivalent of one Williams Fork Formation well per 20 acres, with each well located downhole in the established drilling and spacing unit, no closer than 200 feet from the boundaries of the unit and no closer than 400 feet from any existing Williams Fork Formation well without exception being granted by the Director of the Oil and Gas Conservation Commission.
Township 7 South, Range 95 West, 6th P.M.
Section 30: All
Section 31: All
Township 7 South, Range 96 West, 6th P.M.
Section 25: All
Section 36: All
IT IS FURTHER ORDERED, that the provisions contained in the above order shall become effective forthwith.
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.
IT IS FURTHER ORDERED, that under the State Administrative Procedure Act the Commission considers this order to be final agency action for purposes of judicial review within thirty (30) days after the date this order is mailed by the Commission.
IT IS FURTHER ORDERED, that an application for reconsideration by the Commission of this order is not required prior to the filing for judicial review.
ENTERED this day of January, 2005, as of January 10, 2005.
OIL AND GAS CONSERVATION COMMISSION
OF THE STATE OF COLORADO
By
Patricia C. Beaver, Secretary
Dated at Suite 801
1120 Lincoln Street
Denver, Colorado 80203
January 18, 2005