REPORT OF THE COMMISSION

This cause came on for hearing before the Commission on August 21, 1979 at 9:00 A.M., in Room 318-A, State Centennial Building, Denver, Colorado after giving Notice of Hearing as required by law, on the application of Jerry D. Armstrong for an order establishing 320-acre drilling and spacing units for the production of gas from the "J" Sand underlying certain lands in Arapahoe County, Colorado. The application was amended at the hearing to delete the request for 2640 feet distance between wells and change the permitted well location to 990 feet from the boundaries of the unit.

FINDINGS

The Commission finds as follows:

1. Jerry D. Armstrong, 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. Evidence presented at the hearing indicates that the "J" Sand consti-tutes a common source of supply of gas underlying the following described lands in Arapa-hoe County, Colorado, to-wit:

Township 4 South, Range 62 West, 6th P.M. Section 15: All Section 21: All - Section 16: All Section 22: All

5. In order to prevent the waste of oil and gas, as defined by law; to pro-tect the correlative rights of all parties concerned; to prevent the drilling of unnecessary wells, and to insure proper and efficient development and promote conservation of the oil and gas resources of the State, an order should be made establishing 320-acre drilling and spacing units for the production of gas from the "J" Sand underlying the lands herein defined; that said units should be 320-acres, more or less, consisting of the E/2 and W/2 or the N{ and S{ of each section according to the governmental survey thereof, and the permitted well located no closer than 990 feet to the boundaries of the unit; however, Well No. 22-13 Fatter, located in the NW/4SW/4 Section 22, Township 4 South, Range 62 West, 6th P.M. should be considered the permitted well for the unit consisting of the S/2 of said Section 22.

6. Available geological and engineering data concerning said "J" Sand indicate that one well will efficiently and economically drain an area of approximately 320-acres, and that drilling units of the size and shape hereinabove described are not smaller than the maximum area that can be efficiently and economically drained by one well producing from said "J" Sand.

7. On November 14, 1974, the Commission issued Order No. 277-2 which established 320-acre drilling and spacing units for the production of gas and associated hydrocarbons from the "J" Sand underlying lands in the Sidewinder Field, including

(over) Section 22, Township 4 South, Range 62 West, 6th P.M. Said Section 22 should be deleted from said spaced area and added to the area as described in Finding 4 herein and be part of the Quill Field.

ORDER

NOW, THEREFORE, IT IS ORDERED, that the following rules and regula-tions shall apply hereafter to wells drilled, completed, or re-completed in the "J" Sand underlying the Quill Field, herein described, in addition to other applicable rules and regulations and orders of the Commission, if any, heretofore adopted and not in conflict herewith:

Rule 1. Three hundred twenty (320) acre drilling and spacing units shall be and the same are hereby established for the production of gas ftom the "J" Sand under-lying the following described lands in the Quill Field, Arapahoe County, Colorado, to-wit:

Township 4 South, Range 62 West, 6th P.M. Section 15: All Section 21: All Section 16: All Section 22: All Rule 2. Said drilling units shall consist of three hundred twenty (320) acres, more or less, and each unit shall consist of the E/2 and the W/2 or the N/2 and the S/2 of each quarter section according to the governmental survey thereof (the drilling unit shall be designated at the time of filing for the permit to drill), with the permitted well located no closer than 990 feet to the boundaries of the unit; however, Well No. 22-13 Fatter, located in the NW/4SW/4 Section 22, Township 4 South, Range 62 West, 6th P.M. shall be considered the permitted well for the unit consisting of the S/2 of said Section 22.

IT IS FURTHER ORDERED, that Section 22, Township 4 South, Range 62 West, 6th P.M. is hereby deleted from the spaced area as established by Order No. 277-2 for the Sidewinder Field and added to the spaced area for the Quill Field herein described. 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 or the above orders and rules.

ORDERED this 21st day of August, 1979.

THE OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO

By Frank J. Piro, Secretary

#356-1)

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