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 MAMM CREEK

FIELD, GARFIELD COUNTY, COLORADO

)

)

)

)

CAUSE NO.  191

 

ORDER NO. 191-63

 

REPORT OF THE COMMISSION

 

This cause came on for hearing before the Commission at 9:00 a.m. on March 30, 2009, in Suite 801, The Chancery Building, 1120 Lincoln Street, Denver, Colorado, for an order to

establish an approximate 320-acre drilling and spacing unit for the S½ of Section 5, Township 6 South, Range 92 West, 6th P.M., and allow the equivalent of one well per 10 acres, for the production of gas and associated hydrocarbons from the Mancos Group Formation, with the permitted well to be located no closer than 100 feet to the outside boundary of the unit or no closer than 400 feet from the boundary of the unit for lands not approved for 10-acre density.

 

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 March 26, 2007, the Commission issued Order No. 191-47, which among other things, established an approximate 320-acre drilling and spacing unit consisting of the S½ of Section 5, Township 6 South, Range 92 West, 6th P.M., and allowed the equivalent of one well per 10 acres, for the production of gas and associated hydrocarbons from the Williams Fork and Iles Formations.

 

5.    On February 9, 2009, Antero, by its attorney, filed with the Commission a verified application to establish an approximate 320-acre drilling and spacing unit consisting of the S½ of Section 5, Township 6 South, Range 92 West, 6th P.M., consistent with those previously established for the Williams Fork and Iles Formations, for the production of gas and associated hydrocarbons from the Mancos Group Formation, which is comprised of the stratigraphic equivalent of the Mancos Shale, the Niobrara Formation, and the Mowry Shale.  In addition, the order should allow the equivalent of one well per 10 acres, with the permitted well to be located identical to the setbacks established for the Iles Formation, no closer than 100 feet to the boundary of the unit or no closer than 400 feet from the boundary of the unit for lands not approved for 10-acre density.

 

That, except as previously authorized by order of the Commission, wells to be drilled under this Application should be drilled from the surface either vertically or directionally from no more than one pad located on a given quarter quarter section (or lots or parcels approximately equivalent thereto) unless exception is granted by the Colorado Oil and Gas Conservation Commission pursuant to application made for such exception.

 

6.    On March 17, 2009, 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.

 

7.    Testimony and exhibits presented in support of the application showed that Antero is the majority leasehold owner for the application lands, and that the application lands are under Order No. 191-47 which established an approximate 320-acre drilling and spacing unit for the S½ of Section 5, Township 6 South, Range 92 West, 6th P.M., and allowed the equivalent of one well per 10 acres, for the production of gas and associated hydrocarbons from the Williams Fork and Iles Formations.  Additional testimony indicated that it is the intent of Antero to establish a drilling and spacing unit and well densities for the Mancos Group Formation identical to the drilling and spacing unit and well densities previously established for the Williams Fork and Iles Formations underlying the application lands, which would promote the efficient and economic development of the Williams Fork, Iles and Mancos Group Formations where mineral interest owners for a particular well would be identical.

 

8.    The above-referenced testimony and exhibits show that the proposed spacing and proposed well density will allow more efficient reservoir drainage, will prevent waste, will assure a greater ultimate recovery of gas, and will not violate correlative rights.

 

9.    Antero Resources Corporation agreed to be bound by oral order of the Commission.

 

10.  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 to establish an approximate 320-acre drilling and spacing unit for the S½ of Section 5, Township 6 South, Range 92 West, 6th P.M., and allow the equivalent of one well per 10 acres, for the production of gas and associated hydrocarbons from the Mancos Group Formation, with the permitted well to be located no closer than 100 feet to the outside boundary of the unit or no closer than 400 feet from the boundary of the unit for lands not approved for 10-acre density.

 

ORDER

 

NOW, THEREFORE IT IS ORDERED, that an approximate 320-acre drilling and spacing unit consisting of the S½ of Section 5, Township 6 South, Range 92 West, 6th P.M. is hereby established, and that the equivalent of one well per 10 acres is approved for the unit, for the production of gas and associated hydrocarbons from the Mancos Group Formation, with the permitted well to be located identical to the setbacks established for the Iles Formation, no closer than 100 feet to the boundary of the unit or no closer than 400 feet from the boundary of the unit for lands not approved for 10-acre density.

 

IT IS FURTHER ORDERED, that except as previously authorized by order of the Commission, wells to be drilled under this Order shall be drilled from the surface either vertically or directionally from no more than one pad located on a given quarter quarter section (or lots or parcels approximately equivalent thereto) unless exception is granted by the Colorado Oil and Gas Conservation Commission pursuant to application made for such exception.

 

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 April, 2009, as of March 30, 2009.

           

                                                                        OIL AND GAS CONSERVATION COMMISSION

                                                                        OF THE STATE OF COLORADO

 

 

                                                                        By____________________________________         

                                                                                    Robert A. Willis, Acting Secretary

Dated at Suite 801

1120 Lincoln Street

Denver, Colorado 80203

April 1, 2009