REPORT OF THE COMMISSION

This cause came on for hearing before the Commission on July 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 Beaver Mesa Exploration Company for an order to establish 160-acre drilling and spacing units for the production of gas and associated hydrocarbons from the "J" Sand underlying certain lands in Weld 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 thai the "J" Sand con-stitutes a common source of supply of gas and associated hydrocarbons underlying the following described lands in Weld County, Colorado, to-wit:

Township 1 North, Range 62 West, 6th P.M. Sections 5 thru 8: All Sections 17 thru 20: All Sections 29 and 30: All

4. That in order to prevent the waste of oil and gas, as defined by law; to protect the correlative rights of all parties concerned; to prevent the drilling of unneces-sary 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 160-acre drilling and spacing units For the production of gas and associated hydrocarbons from the "J" Sand, 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, according to the governmental survey thereof; and that the permitted well for each such drilling unit should be located not less than 660 feet from the boundary of each quarter section upon which it is located, and no closer than 1850 feet from another gas well producing from the same source of supply; however, Well No. 2 Tolle, SE/4SW/4 Section 17, Well No. 1 Linnebur, SW/4NW/4 Section 17, Well No. 1 Mabel Tolle, SE/4NE/4 Section 18, Well No. 1 Cowles, C SE/4NW/4 Section 20 and Well No. 1 Herbert, SW/4NE/4 Section 30, all in Township 1 North, Range 62 West, 6th P.M. should be considered the permitted wells for the units upon which they are located.

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

(over)

ORDER

NOW, THEREFORE, IT IS ORDERED, that the following rules and regula-tions shall apply hereafter to wells drilled, completed, or recompleted in the "J" Sand underlying the Prospect 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 hydrocarbons from the "J" Sand underlying the following described lands in the Prospect Field, Weld County, Colorado, to-wit:

Township 1 North, Range 62 West, 6th P.M. Sections 5 thru 8: All Sections 17 thru 20: All Sections 29 and 30: All

Rule 2: Said drilling units shall consist of one hundred sixty (160) acres, and each such drilling unit shall be a quarter section, according to the governmental survey thereof; and the permitted well for each such drilling unit shall be located not less than 660 feet from the boundary of each quarter section upon which it is located, and no closer than 1850 feet from another gas well producing from the same source of supply.

IT IS FURTHER ORDERED, that Well No. 2 Tolle, SE/4SW/4 Section 17, Well No. 1 Linnebur, SW/4NW/4 Section 17, Well No. 1 Mabel Tolle, SE/4NE/4 Section 18, Well No. 1 Cowles, C SE/4NW/4 Section 20 and Well No. 1 Herbert, SW/4NE/4 Section 30, all in Township 1 North, Range 62 West, 6th P.M. shall be the permitted wells for the units upon which they are located.

IT IS FURTHER ORDERED, that the provisions contained in this 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, rules and regulations.

ORDERED this 18th day of July, 1977.

THE OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO

By Frank J. Piro, Secretary

(#326-1)