REPORT OF THE COMMISSION

This cause came on for hearing before the Commission on February 18, 1977 at 9 A.M., in Room 110, State Centennial Building, Denver, Colorado, after giving Notice of Hearing as required by law, on the application of Provident Resources, Inc. for an order establishing 160-acre drilling and spacing units for the production of gas and associated hydrocarbons from the Mancos "B" formation underlying certain lands in Rio Blanco 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 evidence presented at the hearing indicates that the Mancos "B" formation constitutes a common source of supply of gas and associated hydrocarbons under-lying the following described lands in Rio Blanco County, Colorado, to-wit:

Township 4 South, Range 102 West, 6th PM, Section 17 S/2 Section 19: All Section 18: Lots 7 & 8, Section 20: NW/4 E/2SW/4, SE/4

4. That in order to prevent the waste of gas, as defined by law, to protect the correlative rights of all parties concerned; to prevent the drilling of unnecessary wells, and to insure proper and efficient development and promote conser-vation of the gas resources of the State, an order should be made establishing 160-acre drilling and spacing units for the production of gas and associated hydrocarbons from the Mancos "B" formation, common source of supply underlying the lands defined herein; that said units should be 160-acres, more or less, and consisting of a quarter section (or lots and/or quarter-quarter sections comprising approximately 160-acres), according to the governmental survey thereof; and that the permitted well for each such drilling unit should be located in the center of the SE/4 of each quarter section with a tolerance of' 200 feet in any direction; and that Well No. 9-19 Govt., located approximately 1808 feet from the north line and 605 feet from the east line, Section 19, Township 4 South, Range 102 West, 6th P.M., should be the permitted well for the unit consisting of the NE/4 of said Section 19.

5. That all available geological and engineering data concerning said Mancos "B" formation indicate that one well will efficiently and economically drain an area of approximately 160 acres, and that drilling units of the size and shape herein-above described are not smaller than the maximum area that can be efficiently drained by one well producing from said Mancos "B" formation. (over)

ORDER

NOW, THEREFORE, IT IS ORDERED, that the following rules and regulations shall apply hereafter to wells drilled, completed, or recompleted in the Mancos "B" formation underlying the Thunder 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. One Hundred Sixty (160) acre drilling and spacing units shall be and the same are hereby established for the production of gas and associated hydro-carbons from the Mancos "B" formation underlying the following described lands in the Thunder Field, Rio Blanco County, Colorado, to-wit:

Township 4 South, Range 102 West, 6th PM, Section 17: S/2 Section 19: All Section 18: Lots 7 & 8, Section 20: NW/4 E/2SW/4, SE/4

Rule 2, Said drilling units shall consist of one hundred sixty (160) acres, more or less, and each such drilling unit shall consist of a quarter section (or lots and/or quarter-quarter sections comprising approximately 160-acres), according to the governmental survey thereof{ and the permitted well for each drilling unit shall be located in the center of the SE/4 of each quarter section with a tolerance of 200 feet in any direction, and Well No. 9-19 Govt., located approximately 1808 feet from the north line and 605 feet from the east line of Section 19, Township 4 South, Range 102 West, 6th P.M., shall be the permitted well for the unit consisting of the NE/4 of said Section 19.

IT IS FURTHER ORDERED, that the rules and regulations contained herein 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 order, rules and regulations.

ORDERED this 18th day of February 1977.

THE OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO

By Frank J. Piro, Secretary

(#319-1)