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BEFORE THE OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO
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IN THE MATTER OF THE PROMULGATION AND ESTABLISHMENT OF FIELD RULES TO GOVERN OPERATIONS IN THE MAMM CREEK FIELD, GARFIELD COUNTY, COLORADO |
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CAUSE NO. 191
ORDER NO. 191-59 |
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.
Township 6 South, Range 93 West, 6th P.M.
All that part of Section 12, Township 6 South, Range 93 West, 6th P.M., lying in the N½ of said Section more particularly described as follows:
Commencing at a point which bears north 89° 08 35 west a distance of 1525.88 feet from the northeast corner of Section 12, the point of beginning; thence north 88° 47 46 west a distance of 3710.54 feet; thence south 01° 24 28 west a distance of 2311.22 feet; thence north 70° 28 03 east a distance of 763.97 feet; thence north 75° 57 40 east a distance of 813.12 feet; thence north 78° 30 55 east a distance of 2160.49 feet; thence north 77° 41 31 east a distance of 381.56 feet; thence north 00° 30 04 west a distance of 599.27 feet; thence north 88° 31 17 west a distance of 229.48 feet; thence north 00° 11 49 east a distance of 663.22 feet to the point of beginning.
Containing 154.377 acres more or less.
7. On November 24, 2008, James R. Carnahan and Colleen Carnahan (the Protestants), by their attorney, filed with the Commission a protest to the application.
8. On November 25, 2008, a prehearing conference was convened to address the merits of the protest filed by the Protestants. During the course of the prehearing conference, Antero stated that the Protestants were erroneously given notice of the application contained herein, and requested that the protest be dismissed. Further, it was stipulated by parties that the mineral interests owned by the Protestants are entirely outside the boundaries of the application lands. Accordingly, it was found by the Hearings Officers that, under Rules 509.a. and 507.b.(2), as defined by Rule 100, the Protestants lack standing to protest the application and, consequently, the protest was dismissed.
9. On November 26, 2008, 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 exhibits were submitted in support of the application.
10. Testimony and exhibits submitted in support of the application showed a list of all consenting and nonconsenting interest owners within the proposed drilling and spacing unit. Additional testimony indicated that in the proposed approximate 154.377-acre drilling and spacing unit located in the N½ of Section 12, Township 6 South, Range 93 West, 6th P.M., for the development and operation of the Williams Fork and Iles Formations, Antero has a 90.36% working interest in the unit. Further testimony showed that Antero has provided the nonconsenting interest owners with offers to lease their mineral interests or to participate in drilling the proposed Hoffmeister A-7 Well. Testimony indicated that such offers and the related Authorities For Expenditure were fair and reasonable and similar to those prevailing in the area, and that the offers were sent via mail and all were received at least thirty (30) days prior to the December 9, 2008 hearing date. Further testimony showed 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.
13. On December 9, 2008, the protestants, by their attorney, and Antero, by its attorney, appeared before the Commission and argued their respective positions regarding the recommendations of the Hearing Officers and dismissal of the protest, which are found in Finding No. 7 above. Subsequently, the Commission voted unanimously to accept the recommendation of the Hearing Officers and approved the application, and granted the relief requested therein, under Rule 511.b.
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, the nonconsenting interests in the approximate 154.377-acre drilling and spacing unit consisting of the lands described below are hereby pooled for the development and operation of the Williams Fork and Iles Formations:
Township 6 South, Range 93 West, 6th P.M.
All that part of Section 12, Township 6 South, Range 93 West, 6th P.M., lying in the N½ of said Section more particularly described as follows:
Commencing at a point which bears north 89° 08 35 west a distance of 1525.88 feet from the northeast corner of Section 12, the point of beginning; thence north 88° 47 46 west a distance of 3710.54 feet; thence south 01° 24 28 west a distance of 2311.22 feet; thence north 70° 28 03 east a distance of 763.97 feet; thence north 75° 57 40 east a distance of 813.12 feet; thence north 78° 30 55 east a distance of 2160.49 feet; thence north 77° 41 31 east a distance of 381.56 feet; thence north 00° 30 04 west a distance of 599.27 feet; thence north 88° 31 17 west a distance of 229.48 feet; thence north 00° 11 49 east a distance of 663.22 to the point of beginning.
Containing 154.377 acres more or less.
2. The production obtained from each drilling unit shall be allocated to each owner in the unit on the basis of the proportion that the number of net acres (for the formation in respect of which the unit has been established) bears to the total acres in the unit. The operator, using standard engineering techniques, shall determine the percentage of production attributable to each formation produced by a given well.
3. Said nonconsenting owners are herby deemed to have elected not to participate and shall therefore be deemed to be nonconsenting as to the well(s) drilled and be subject to the penalties as provided for by §34-60-116(7), C.R.S., as amended.
4. Any nonconsenting unleased mineral owner within the a given spacing unit shall be treated as the owner of the landowners 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 owners proportionate 87.5% share of production, the costs specified in §34-60-116(7)(b), C.R.S., as amended.
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 December, 2008, as of December 9, 2008.
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
December 19, 2008