BEFORE THE OIL AND GAS CONSERVATION COMMISSION

OF THE STATE OF COLORADO

 

IN THE MATTER OF THE PROMULGATION OF FIELD RULES TO GOVERN OPERATIONS IN THE "D" SAND OF THE ADENA FIELD, MORGAN COUNTY, COLORADO

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CAUSE NO. 26

 

ORDER NO. 26-32

 

REPORT OF THE COMMISSION

 

This cause came on for hearing before the Commission on November 28, 1956, at 10:00 a.m., in the Colorado Room, Shirley Savoy Hotel, Denver, Colorado, after publication of Notice of Hearing as required by law, on the application of The Pure Oil Company, for an order from the Commission amending in part its Order No. 26-25 insofar as said order establishes the basic allowable for 160-acre gas spacing units in the "D" sand in the Adena Field, Morgan County, Colorado; and providing for voluntary designation or creation of larger "D" sand gas units and establishing the basic allowable for such larger units, and for the classification of "D" sand wells.

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 underlying the following described lands in the Adena Field, Morgan County, Colorado, constitutes a gas pool, reservoir and common source of supply which is separate and distinct from other oil and gas producing areas in said Adena Field:

 

Township 1 North, Range 57 West, 6th P.M.

 

 

West Half (W/2) of Section 6

 

 

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

 

 

All of Sections 1 and 12

 

within which reservoir The Pure Oil Company owns oil and gas leases.

 

4.      That in order to prevent undue waste of gas from "D" sand wells on the above described lands, the maximum "D" sand production from any one 160-acre drilling and spacing gas unit located within the above described lands should not, during any one month, exceed a daily average of 150,000 cubic feet of gas, except that a greater allowable should be established where additional spacing units are attributed to a gas well as hereinafter provided; that no one "D" sand gas well thereon should produce during any one 24-hour period more than twice its daily allowable, and that the allowable production may be exceeded for any one month by not in excess of three (3) days allowable production, provided that any such excess production should be deducted from the next month's allowable, and that any underproduction may be produced only during the month immediately following that in which the underproduction occurred.

 

5.      That according to the testimony presented at this hearing, one "D" sand gas well drilled on any 160-acre gas spacing unit within the above area is capable of producing all of the recoverable "D" sand gas underlying as many as four such 160-acre units; that avoidable drilling of unnecessary gas wells may be prevented by establishing an acreage factor in fixing allowables for production of gas in the common source of supply covered by this order. That in the event all parties owning the "D" sand gas leases, royalties and gas rights in more than one, but not exceeding four, contiguous 160-acre "D" sand gas spacing units in the above area shall, by voluntary agreement or designation, unitize or consolidate such tracts for the production of "D" sand gas, or if the gas leases and rights and royalties within such consolidated tracts are held in uniform ownership, with only one "D" sand gas well being located on the entire acreage so consolidated, such consolidated tract should be entitled to a "D" sand gas allowable equal to 150,000 cubic feet of gas multiplied by the number of 160-acre gas spacing units (not to exceed four) included in such consolidated tract. That such increased allowables will promote development for gas and increase the ultimate recovery thereof without waste, and protect correlative rights of all persons affected by this order.  

 

ORDER

 

NOW, THEREFORE, IT IS ORDERED, that the following Rules and Regulations shall apply hereafter to, and the same are hereby adopted for, the "D" sand pool of the Adena Field, Morgan County, Colorado, underlying the lands hereinbelow described:

 

Rule 1.    The "D" sand formation of the Dakota Series in the Adena Field, Morgan County, Colorado, constitutes a common source of supply of gas underlying the following lands:

 

West Half (W/2) of Section Six (6), Township One (1) North, Range Fifty-seven (57) West, and all of Sections One (1) and Twelve (12), Township One (1) North, Range Fifty-eight (58) West, 6th P.M., Morgan County, Colorado

 

which source of supply is separate and distinct from other oil and gas sources in said field.

 

Rule 2.    The maximum "D" sand allowable for any one 160-acre drilling and spacing gas unit located within the above-described reservoir shall not, during any one month, exceed a daily average of One Hundred Fifty Thousand (150,000) cubic feet of gas, except as hereinafter otherwise provided in Rule 3; no one "D" sand gas well therein shall produce during any one 24-hour period more than twice its daily allowable, and the allowable production may be exceeded for any one month by not in excess of three (3) days allowable production, provided that any such excess production shall be deducted from the next month's allowable, and any underproduction may be produced only during the month immediately following that in which the underproduction occurred.

 

Rule 3.    Acreage shall be a factor in fixing allowables for gas production from the source of supply covered hereby. If all the operators and owners of "D" sand oil and gas leases, royalties and minerals in any two or more, but not exceeding four, contiguous 160-acre gas spacing units, which shall extend not more than two units in any direction, shall, by voluntary agreement or designation, unitize or consolidate such tracts for the production of gas, or if the "D" sand gas leases, royalties and minerals within such tracts are held in uniform ownership, and in the event a natural gas well has heretofore been or hereafter shall be drilled or completed on a regular location, or pursuant to an exception regularly granted, in any such voluntarily unitized or consolidated tract, a gas well on such voluntary unitized and consolidated tract shall be entitled to an allowable for gas equal to One Hundred Fifty Thousand (150,000) cubic feet of gas multiplied by the number of 160-acre gas spacing units (not to exceed four) included in such consolidated or unitized tract; provided, however, that there shall be only one (1) gas well producing from said zone in such voluntarily unitized or consolidated tract and no oil well spacing unit on which there shall be located a producing "D" sand oil well shall be included in calculating such increased allowables for gas production.

 

Rule 4.    Each well completed in the "D" sand underlying the lands covered by this order shall be classified as an oil well or a gas well. The existing wells known as the Bill Tomberlin W.E. Cochran No. 3 well located in the Southeast Quarter of the Southwest Quarter of the Northwest Quarter (SE/4 SW/4 NW/4) of Section Twelve (12), Township One (1) North, Range Fifty-eight (58) West; and The Pure Oil Company's J.H. Cochran No. 1 well located in the Southeast Quarter of the Southeast Quarter of the Southwest Quarter (SE/4 SE/4 SW/4) of Section One (1), Township One (1) North, Range Fifty-eight (58) West, are classified as gas wells.

 

Rule 5.    No gas produced shall be allowed to be released directly or indirectly into the open air on any lease, except for occasional emergencies, or when otherwise ordered by the Commission; and all produced gas shall be metered within practical limits, and such metered volumes shall be reported to the Commission.

 

Rule 6.    In the event an oil well shall be completed in said zone, the rules set forth in Order No. 26-25 shall remain applicable thereto, until and unless otherwise ordered by the Commission.

 

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 and regulations.

 

ORDERED this 28th day of November, 1956.

 

OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO

 

 

By  Annabel Hogsett, Secretary