REPORT OF THE COMMISSION

This cause came on for hearing before the Commission at 8:30 a.m. on March 18, 1994, in Room 318, State Centennial Building, 1313 Sherman Street, Denver, Colorado, on the verified application of Raydon Exploration, Inc., for an order allowing a well to be drilled at an exception location in the center of the NW1/4 SW1/4 of Section 5, Township 13 South, Range 44 West, 6th P.M., for production of oil and associated hydrocarbons from the Mississippian Forma tion, for the 80-acre drilling and spacing unit consisting of the W1/2 SW1/4 of said Section 5.

FINDINGS

The Commission finds as follows:

1. Raydon Exploration, Inc., as applicant herein, is an interested party in the subject matter of the above-referenced matter.

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 February 18, 1977 the Commission authorized Order No. 320-1 to be issued, which among other things, established 80-acre drilling and spacing units for the production of oil and associated hydrocarbons from the Mississippian Formation underlying certain lands Broken Bow Field in Cheyenne County, Colorado, including Section 5, Township 13 South, Range 44 West, 6th P.M. Said units shall consist of the E1/2 and W1/2 or the N1/2 and S1/2 of each gover nmental quarter section, with the permitted well to be located in the center of the NE1/4 and SW1/4 of each quarter section, with a tolerance of 150 feet in any direction to avoid surface hazards.

5. Wells have been drilled and were produced from the Mississippian Formation in the NW1/4 SW1/4 and the SW1/4 SW1/4 of Section 5, Township 13 South, Range 44 West, 6th P.M., and were plugged and abandoned in 1986.

6. Geological and engineering evidence presented at the administrative hearing indicated that a well located in the NW1/4 SW1/4 of said Section 5 is necessary in order to recover all the hydrocarbons in the Mississippian Formation underlying the 80-acre drilling and spacing unit consisting of the W1/2 SW1/4 of said Section 5.

7. That in order to protect correlative rights and to prevent waste, a well should be authorized to be drilled at an exception location in the center of the NW1/4 SW1/4 of said Section 5 for the 80-acre drilling and spacing unit consisting of the W1/2 SW1/4 of said Section 5 for production from the Mississippian Formation.

8. Based on the facts stated in the verified application and having been heard by the Hearing Officers who recommended approval of the application, and having received no protests, the Commission should approve the request and amend Order No. 320-1 to allow an exception well to be drilled and completed for production from the Mississippian Formation. O R D E R

NOW, THEREFORE, IT IS ORDERED that Order No. 320-1 is hereby amended and the a well is authorized to be drilled at an exception location in the center of the NW1/4 SW1/4 of Section 5, Township 13 South, Range 44 West, 6th P.M., with a tolerance of 150 feet in any direction for surface hazards for production from the Mississippian Formation, for the 80-acre drilling and spacing unit consisting of the W1/2 of the SW1/4 of said Section 5.

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 of the above orders.

ENTERED this day of 1994, as of March 18, 1994.

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 March 25, 1994 ??