BEFORE
THE
OF
THE STATE OF
|
IN THE MATTER OF
THE PROMULGATION AND ESTABLISHMENT OF
FIELD RULES TO GOVERN OPERATIONS IN THE MAMM CREEK FIELD, |
) CAUSE NO. 191 )
) ORDER NO. 191-51 ) |
REPORT
OF THE COMMISSION
This cause came on for
hearing before the Commission at 9:00 a.m. on
FINDINGS
The Commission finds as follows:
1. Antero
Resources Piceance Corporation ("Antero"), as applicant herein, is an
interested party in the subject matter of the above-referenced hearing.
2. Due
notice of the time, place and purpose of the hearing has been given in all
respects as required by law.
3. 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 pursuant to the Oil and Gas Conservation Act.
4. On
5. On
A parcel of land in the N½ of Section 18, Township 6
South, Range 92 West, 6th P.M. beginning 445.03 feet south of the
NE¼ NE¼ of said section; thence south 00º 34’ 00” East a distance of 362.60
feet; thence south 519.00 feet; thence south 1320.00 feet; thence west 4260.91
feet; thence North 00º 04’ 16” west a distance of 2327.20 feet; thence North
70º 50’ 00” East a distance of 471.60 feet; thence South 89º30’00” East a
distance of 300.00; thence South 76º 42’ 00” east a distance of 1128.10 feet;
thence South 89º 30’ 00” east a distance of 2085.20 feet; thence South 89º 59’
30” east a distance of 181.30 feet; thence south 89º 58’ 00” east a distance of
150.5 feet to the point of beginning
The applicant plans to directionally
drill the Dixon A-4 Well in said Section 18. Offers to lease or to participate
have been made to the mineral owners or the leasehold owners but as of the date
the application was filed, not all of these attempts have been successful.
6. On July 3, 2007, Antero, by its attorney, filed with the
Commission a written request to approve the application based on the merits of
the verified application and the supporting exhibits. Sworn written testimony and five (5) exhibits
were submitted in support of the application.
7. Testimony
and exhibits submitted in support of the application showed that Antero
proposes to drill the Dixon A-4 Well to the
Williams Fork and the Iles Formations within the drilling and spacing unit
described above with a surface location 1,250 feet FNL and 2,400 feet FWL and a
bottomhole location 1,400 feet FNL and 525 feet FWL in Section 18.
8. Testimony
and exhibits submitted in support of the application showed a list of all
consenting and nonconsenting parties, indicating that Antero has approximately 80.74%
of the unit leased and that the non-consenting owners located within this unit
comprise approximately 16.68% of the well which are subject to the force
pooling application. Approximately 2.58%
of the spacing unit are unleased owners and have not been given proper notice;
therefore such interests are not subject to this order for pooling.
9. Testimony
and exhibits submitted in support of the application showed that offers to
lease or to participate were sent to nonconsenting owners. Additional testimony submitted showed that
the offers and the Authorizations for Expenditures were fair and reasonable,
and similar to those prevailing in the area.
Further testimony submitted showed the offers were sent via certified
mail and all were received at least thirty (30) days prior to the July 23, 2007
hearing date, as evidenced by return receipt cards.
10. The
testimony and exhibits submitted indicate that Antero has complied with the
requirements of Rule 530.a. and §34-60-116(7)(d), C.R.S.
11. Antero
Resources Piceance Corporation agreed to be bound by oral order of the
Commission.
12. On
July 17, 2007, Grant Brothers Ranch, LLC filed with the Commission a written
statement under Rule 510. requesting that the Commission deny Antero’s
application to involuntarily pool Grant Brothers’ unleased mineral
interests.
13. Based on the facts stated in the verified application, having received no protests and based on the Hearing Officer review of the application under Rule 511.b., the Commission should enter an order pooling all nonconsenting interests in the approximate 223.578-acre drilling and spacing unit lying in the N½ of Section 18, Township 6 South, Range 92 West, 6th P.M., for the development and operation of the Williams Fork and Iles Formations.
ORDER
NOW,
THEREFORE IT IS ORDERED that, 1. Pursuant
to the provisions of §34-60-116, C.R.S., as amended, of the Oil and Gas
Conservation Act of the State of Colorado, all of the nonconsenting interests
in the 223.578-acre drilling and spacing unit located in Section 18, Township 6 South, Range 92 West, 6th
P.M., are hereby pooled for
the development and operation of the Williams Fork and Iles Formations,
described as follows:
A parcel of land in
the N½ of Section 18, Township 6 South, Range 92 West, 6th P.M.
beginning 445.03 feet south of the NE¼ NE¼ of said section; thence south 00º
34’ 00” East a distance of 362.60 feet; thence south 519.00 feet; thence south
1320.00 feet; thence west 4260.91 feet; thence North 00º 04’ 16” west a
distance of 2327.20 feet; thence North 70º 50’ 00” East a distance of 471.60
feet; thence South 89º30’00” East a distance of 300.00; thence South 76º 42’
00” east a distance of 1128.10 feet; thence South 89º 30’ 00” east a distance
of 2085.20 feet; thence South 89º 59’ 30” east a distance of 181.30 feet;
thence south 89º 58’ 00” east a distance of 150.5 feet to the point of
beginning
2. The
production obtained from the drilling unit shall be allocated to each owner in
the unit on the basis of the proportion that the number of acres in such tract
bears to the total number of mineral acres within each drilling unit; each
owner of an interest in each drilling unit shall be entitled to receive his/her
share of the production of the well located on each drilling unit applicable to
his interest in each drilling unit.
3. Said
owners are hereby deemed to have elected not to participate and shall therefore
be deemed to be nonconsenting as to the well(s) and be subject to the penalties
as provided for by §34-60-116 (7), C.R.S.
4. Any
nonconsenting unleased mineral owner within the spacing unit shall be treated
as the owner of the landowner's royalty to the extent of 12.5% of his/her
record title interest, whatever that interest may be, until such time as the
consenting owner recovers, only out of the nonconsenting owner's proportionate
87.5% share of production, the costs specified in §34-60-116 (7)(b), C.R.S. as
amended. After recovery of such costs, the nonconsenting mineral owner shall
then own his/her proportionate 8/8ths share of the well, surface facilities and
production, and then be liable for his/her proportionate share of further costs
incurred in connection with the well as if he/she had originally agreed to the
drilling.
5. The
operator of any well drilled on the above-described unit shall furnish all nonconsenting
owners with a monthly statement of all costs incurred, together with the
quantity of oil and gas produced, and the amount of proceeds realized from the
sale of production during the preceding month.
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 August, 2007, as of July 23,
2007.
OIL
OF THE STATE OF
By
Patricia
C. Beaver, Secretary
Dated at
August 15, 2007