30-7

BEFORE THE OIL AND GAS CONSERVATION COMMISSION

OF THE STATE OF COLORADO

IN THE MATTER OF THE INVESTIGATION TO TAKE MEASURES TO PREVENT WASTE OF OIL AND GAS IN THE "D" AND "J" SANDS OF THE LITTLE BEAVER FIELD IN WASHINGTON AND ADAMS COUNTIES, COLORADO

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CAUSE NO. 30

ORDER NO. 30-7

REPORT OF THE COMMISSION

This cause came on for further hearing before the Commission on July 13, 1955, at 10:00 A.M., in Room 330 State Office Building, Denver, Colorado, after publication of Notice of Hearing as required by law, upon the Commission's own motion, to further consider the application of the Triangle "J" Oil Company and the Denver Basin Oil Company for an increase in the allowance of gas produced from gas wells in the "J" sand formation, and to take further measures to prevent the waste of oil and gas in the "J" sand of the Little Beaver Field, Washington and Adams Counties, 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 on the 12th day of January, 1955, pursuant to notice and hearing, the Commission entered its Order No. 30-6, wherein the operators and owners of wells producing from both the "D" and "J" sand pools of the Little Beaver Field were permitted to produce (1) from the "D" sand, 125 barrels of oil per day with a gas limit of 100,000 cubic feet per day; and (2) from the "J" sand, 125 barrels of oil per day with a gas limit of 150,000 cubic feet per day.

4. That the operators and owners of wells producing gas only from the gas cap of the "J" sand pool of the Dakota Series of the Little Beaver Field have been shut-in for the reason that there has been no market for the gas; and that the owners and operators of the oil wells in the "J" sand pool have been flaring the gas produced from their wells for the reason that there has been no market for the gas.

5. That there is now a market for all gas produced from the "J" sand pool of the Little Beaver Field.

6. That, in order to prevent reasonably avoidable drainage of oil and gas across property lines, and to permit the operators and owners an equal opportunity to obtain and produce their just and equitable share of the recoverable oil and gas underlying the "J" sand pool, common source of supply; and in order to protect the correlative rights of owners of wells in the gas cap, and to further prevent the 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 production from stay one well producing both oil and gas with a gas-oil-ratio of less than 30,000 cubic feet of gas to one barrel of oil, from the "J" sand pool should not, during any one month, exceed a daily average of 125 barrels of oil and/or 125,000 cubic feet of gas; and the maximum production from any one well producing gas only, with a gas-oil-ratio in excess of 30,000 cubic feet of gas to one barrel of oil, from the "J" sand pool should not, during any one month, exceed a daily average of 300,000 cubic feet of gas; and that no one well should produce during any 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, however, that any such excess production should be deducted in producing the next month's allowable; and that any underproduction may be produced only during the month immediately following that in which the underproduction occurred,

7. That since there is now a market for the gas produced from the "J" sand pool reservoir of the Little Beaver Field, the operators and owners of all wells producing oil or gas or both oil and gas from the "J" sand pool of the Dakota Series of the Little Beaver Field 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.

8. That the operators and owners of wells producing from the "J" sand pool of the Dakota Series of the Little Beaver Field who appeared at the Hearing were in agreement with this order, and that the same should be effective for a sixty (60) day period.

9. That the rules and regulations of Order No. 30-6 affecting the "D" sand pool of the Dakota Series of the Little Beaver Field should remain in full force and, effect as to said "D" sand pool.

10. That Rules 3 and 4 of Order No. 30-6, which pertain to gas-oil-ratio tests and production reports, should be made a part of this order.

ORDER

NOW, THEREFORE, IT IS ORDERED, that the following rules and regulations be, and the same are, hereby adopted for the "D" and "J" sand pool of the Little Beaver Field in Washington and Adams Counties, Colorado.

Rule 1. That, in order to prevent reasonably avoidable drainage of oil and gas across property lines, and to permit the operators and owners an equal opportunity to obtain and produce their just and equitable share of the recoverable oil and gas underlying the "J" sand pool, common source of supply; and in order to protect the correlative rights of owners of wells in the gas cap, and to further prevent the 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 production from any one well producing both oil and gas with a gas-oil-ratio of less than Thirty Thousand (30,000) cubic feet of gas to one (1) barrel of oil, from the "J" sand pool shall not, during any one month, exceed a daily average of One Hundred Twenty-five (125) barrels of oil and/or One Hundred Twenty-five Thousand (125,000) cubic feet of gas; and the maximum production from any one well producing gas only, with a gas-oil-ratio in excess of Thirty Thousand (30,000) cubic feet of gas to one (1) barrel of oil from the "J" sand pool shall not, during any one (1) month, exceed a daily average of Three Hundred Thousand (300,000) cubic feet of gas; and that no one well shall produce during any Twenty-four (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, however, that any such excess production shall be deducted in producing the next month's allowable; and that any underproduction may be produced only during the month immediately following that in which the underproduction occurred.

Rule 2. That since there is now a market for the gas produced from the "J" sand pool reservoir of the Little Beaver Field, the operators and owners of all wells producing oil or gas or both oil and gas from the "J" sand pool of the Dakota Series of the Little Beaver 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. That the operators and owners of wells producing from the "D" or "J" sand pools of the Dakota Series of the Little Beaver Field shall make a gas-oil-ratio test of each of his producing wells during every quarter, beginning with the months of January, April, July, and October; and that such tests shall not be taken within fifteen (15) days of the beginning or ending of each quarter, the results of which such tests shall be reported to the Commission on or before the fifteen [sic] (15th) day of the last month of every quarter; and that such tests shall be the basis for calculating the volume of gas produced for each month of the following quarter, unless all of the gas produced is metered; that, immediately prior to making the test for a gas-oil ratio, subject well shall be produced at its normal rate of production for at least twenty-four (24) hours; and that during such tests, subject well shall produce a volume equal to or not exceeding its allowable by more than twenty-five percent (25%); if capable; and that a schedule shall be submitted to the Commission prior to testing, showing the wells and respective dates of tests; and that the volume of gas measured shall be reported in units of cubic feet at a base pressure of 15.025 psia, a base temperature of 60° Fahrenheit, and a specific gravity of 0.7.

Rule 4. That the operators and owners of wells producing from the "D" and "J" sand pools of the Dakota Series shall file with the Commission a monthly report of production by wells, as required on Form OGCC-7a covering the month next preceding the date of filing, on or before the twentieth (20th) day of each month.

IT IS FURTHER ORDERED, that this Order shall replace Order No. 30-6 as to the "J" sand pool of the Dakota Series of the Little Beaver Field, and that Order No. 30-6 shall remain in full force and effect as to the "D" sand pool of the Dakota Series of the Little Beaver Field.

IT IS FURTHER ORDERED, that this order shall become effective on August 1, 1955, and remain in full force and effect until October 1, 1955, or until further order of this Commission, pursuant to notice and hearing.

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 13th day of July, 1955.

OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO

By Annabel Hogsett, Secretary