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 WATTENBERG GAS SPACED AREA, WELD COUNTY, COLORADO	) ) ) )	CAUSE NO.   232 ORDER NO.   232-58

REPORT OF THE COMMISSION

                                  This cause came on for hearing before the Commission on January 21, 1992 at 8:30 a.m. in Room 101, State Education Building, 201 East Colfax, Denver, Colorado, after giving Notice of Hearing as required by law, on the application of Martin Exploration Management Corporation for an order granting two exceptions to the permitted well location as provided for in Order No. 232-1 for production of gas and associated hydrocarbons from the "J" Sand Formation underlying the W1/2, Section 31, Township 2 North, Range 68 West, 6th P.M.

FINDINGS

                                  The Commission finds as follows:

                                  1.  Martin Exploration Management Corporation, 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.

                                  4.  On November 17, 1970 the Commission issued Order No. 232-1, which among other things, established 320-acre drilling and spacing units for certain lands in the Wattenberg Field, for production of gas and associated hydrocarbons from the "J" Sand Formation no closer than 990 feet from the boundaries of the quarter section.  The W1/2 of Section 31, Township 2 North, Range 68 West, 6th P.M., Weld County, Colorado lies within the area spaced by these orders.

                                  5.  The matter was heard by the Hearing Officer who recommends approval based upon the surface topographic testimony presented at an administrative hearing.

                                  6.  No objections to the application were received and an order of the Commission should be entered allowing a well to be drilled at the above-described exception locations.

ORDER

                                  NOW, THEREFORE, IT IS ORDERED, that two exceptions to the permitted well location as provided for in Order No. 232-1 for a "J" Sand Formation well for the Wattenberg Gas Spaced Area is hereby granted for the Armstead No. 4-31 Well to be drilled at a location 860 feet FSL and 1980 feet FWL of Section 31, Township 2 North, Range 68 West, 6th P.M., Weld County, Colorado and that an exception is granted for the Armstead No. 5-31 Well to be drilled at a location 1240 feet FNL and 1800 feet FWL of said Section 31 for the production of gas and associated hydrocarbons from the "J" Sand Formation for the unit consisting of the W1/2 of said Section 31.

                                  IT IS FURTHER ORDERED, that should a commercial well be completed at the location set forth above, the Commission shall, upon application of any interested person, take such action as will offset any producers by reason for drilling the well as an exception, including suitable provisions to prevent the production from the well drilled as an exception of more than its just and equitable share of the oil and gas in the pool.

                                  IT IS FURTHER ORDERED, that the provision 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.

                                  Entered this _______________ day of ____________________, 1992, as of January 21, 1992.

                                                                             OIL AND GAS CONSERVATION COMMISSION

                                                                                 OF THE STATE OF COLORADO

                                                                             BY _____________________________________

                                                                                Patricia C. Beaver, Secretary

Dated at Suite 380

1580 Logan Street

Denver, Colorado  80203

February 28, 1992

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