204-3

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 BOXER FIELD, MORGAN COUNTY, COLORADO

)

CAUSE NO. 204

ORDER NO. 204-3

REPORT OF THE COMMISSION

This cause came on for hearing before the Commission on June 20, 1967, at 10 a.m., in Room 132, State Services Building, Denver, Colorado, said hearing having been continued from May 16, 1967, pursuant to a motion made by Cardinal Petroleum Company and Fred Goodstein and having been originally instituted by the Commission to consider measures to prevent waste of oil and gas in the "D" sand reservoir underlying certain lands in Morgan County, Colorado.

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 the "D" sand formation in the Boxer Field, as used herein, constituted a common source of supply underlying the following described lands in Morgan County, Colorado, to-wit:

Township 1 North, Range 58 West, 6th P.M.

Section	5:	N½

Township 2 North, Range 58 West, 6th P.M.

Section	16:	E½, SW¼	Section	29:	All
Section	20:	All	Section	31:	E½E½
Section	21:	All	Section	32:	All
Section	28:	W½, W½NE¼	Section	33:	W½W½

4. That in order to prevent undue waste of oil and gas, and to prevent the escaping, blowing, and releasing of gas in an excessive or unreasonable amount from wells producing both oil and gas, and to prevent underground waste, inefficient, excessive, and improper use and dissipation of reservoir energy, the maximum "D" sand production from any one forty-acre tract located in the Boxer Field should not, during any one month, exceed a daily average of 150 barrels of oil, or 300 Mcf of gas, whichever is produced first and that when any well reaches a gas-oil ratio of 20, 000 [sic] to 1, such well should be shut in pending a gas market; and that upon completion of facilities for said gas market the maximum production of gas from any one forty-acre tract should not, during any one month, exceed a daily average of 300, 000 [sic] cubic feet of gas.

5. That when there is a market for the gas produced from the "D" sand reservoir of the Boxer Field, the operators and owners of all wells producing oil or gas, or both oil and gas, from the "D" sand formation should not produce gas from any one well unless:

1.	The gas so produced is marketed to supply domestic or municipal needs;
	- or -
2.	The gas so produced is required for lease development or operations and fuel.

6. That the operators and owners of wells producing from the "D" sand formation of the Boxer Field should make a gas-oil ratio test of each of their producing wells during every quarter, unless otherwise authorized by the Director.

7. That the operators and owners of wells producing from the "D" sand formation of the Boxer Field should file with the Commission a monthly report of production by wells, as required on Form OGCC-7 covering the month next preceding the date of filing on or before the 25th day of each month unless other-wise authorized by the Commission.

ORDER

NOW, THEREFORE, IT IS ORDERED, that in addition to other applicable rules, regulations and orders of the Commission heretofore adopted and not in conflict herewith, the following rules and regulations be, and the same are, hereby adopted for the "D" sang formation underlying the lands in Morgan County, Colorado, as set forth below, to-wit:

Township 1 North, Range 58 West, 6th P.M.

Section	5:	N½

Township 2 North, Range 58 West, 6th P.M.

Section	16:	E½, SW¼	Section	29:	All
Section	20:	All	Section	31:	E½E½
Section	21:	All	Section	32:	All
Section	28:	W½, W½NE¼	Section	33:	W½W½

and such area shall henceforth be known as the Boxer Field.

Rule 1. From and after the effective date of this order and until August 1, 1967, the daily allowable for any one well shall be limited to 300,000 cubic feet of gas or One Hundred Fifty (150) barrels of oil, whichever is first produced. Thereafter, the daily gas allowable for any one well shall be limited to 300,000 cubic feet of gas, and the daily oil allowable for any one well shall be the maximum amount of oil it is capable of producing, as determined by the tests required herein by these rules, not to exceed One Hundred Fifty (150) barrels; provided, however, that wells which have a gas-oil ratio in excess of 2000 cubic feet of gas per barrel of oil shall be granted an allowable as determined by the following formula, not to exceed the oil capacity of such a well:

Daily Oil Allowable =	150 barrels x 2000 cubic feet per barrel
	Gas-oil ratio of well

No well shall produce during any one twenty-four (24) hour period more than twice its daily allowable, and the allowable production for any one month may not be exceeded by more than three days allowable, and any such excess shall be deducted from the next month's allowable. Any underproduction may be produced only during the month immediately following that in which the underproduction occurs.

Rule 2.

a.	When any well reaches a gas-off ratio of 20,000 to 1, such well shall be classified as a gas well,

b.	All gas wells shall be shut in pending a gas market, and upon completion of facilities for said gas market, the maximum production of gas from any one forty-acre tract shall not exceed a daily average of 300,000 cubic feet of gas.

c.	When there is a gas market, unless otherwise authorized by the Director, the operators and owners of all wells producing oil or gas, or both oil and gas from the "D" sand formation of the Boxer Field, shall not produce gas from any one well unless:

		1.	The gas so produced is marketed to supply domestic or municipal needs;
			- or -
		2.	The gas so produced is required for lease development or operations and fuel.

Rule 3. Unless otherwise authorized by the Director, each well shall be tested during the month of July 1967, and thereafter shall be tested each three months for the quarters beginning with the months of October, January, April, and July, and such subsequent tests shall not be taken within 45 days of the beginning nor 15 days of the ending of each quarter, the results of which shall be reported to the Commission on the 15th day of the last month of each quarter. Such tests shall be the basis for calculating the oil allowable for the following quarter. Each well shall be produced at its normal rate of production for the last twenty-four (24) hours prior to the actual test and that during such test the well shall be produced at a rate not greater or less than 10% of the pre-test rate. Not less than ten (10) days prior to the testing of the well, a schedule shall be submitted to the Commission and to the offset operators showing the wells and the respective dates of tests so that the Commission and offset operators will have an opportunity to wetness such tests. The volume of gas measured shall be reported in units of cubic feet at a base pressure of 15.025 psia and a base temperature of 60° F, and the gas-oil ratio shall be made and calculated in accordance with good engineering principles.

Rule 4. The operators and owners of wells producing from the "D" sand formation of OGCC Form 7, on or before the twenty-fifth (25th) day of each month succeeding the month in which the production occurs, containing information of production by wells, unless otherwise authorized by the Director.

IT IS FURTHER ORDERED: that this order shall become effective on July 7, 1967.

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, rules or regulations.

ORDERED this 7th day of July 1967.

OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO

D.V. Rogers, Acting Secretary