BEFORE THE OIL AND GAS CONSERVATION COMMISSION
OF THE STATE OF COLORADO
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IN THE MATTER OF THE PROMULGATION AND ESTABLISHMENT OF FIELD RULES TO GOVERN OPERATIONS FOR THE NIOBRARA FORMATION, WATTENBERG FIELD, WELD COUNTY, COLORADO |
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CAUSE NO. 407
DOCKET NO. 1410-SP-2137
ORDER NO. 407-1124 |
REPORT OF THE COMMISSION
The Commission heard this matter on October 27, 2014 at the Durango Public Library, 1900 E. 3rd Avenue, Durango, CO 81301, upon application for an order to amend Order No. 407-1085 to apply to previously unnoticed parties in an approximate 1280-acre drilling and spacing unit established for Sections 35 and 36, Township 5 North, Range 61 West, 6th P.M., for the development and operation of the Niobrara Formation.
FINDINGS
The Commission finds as follows:
1. Bill Barrett Corporation (“BBC” or “Applicant”) 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 pursuant to the Oil and Gas Conservation Act.
4. On April 27, 1998, the Commission adopted Rule 318A, the Greater Wattenberg Area Special Well Location, Spacing and Unit Designation Rule. Sections 35 and 36, Township 5 North, Range 61 West, 6th P.M. are subject to Rule 318A for the Niobrara Formation.
5. On February 22, 2011 (corrected April 4, 2013), the Commission entered Order Nos. 407-779 and 535-4 which established 74 approximate 640-acre drilling and spacing units for Townships 4, 5, and 6 North, Ranges 61 and 62, and 6th P.M., and approved up to one horizontal well in each unit, for the production of oil, gas, and associated hydrocarbons from the Niobrara Formation.
6. On July 28, 2014, the Commission entered Order No. 407-1085 which vacated an approximate 640-acre drilling and spacing unit and established an approximate 1280-acre drilling and spacing unit and approved up to 16 horizontal wells within the proposed unit, for the production of oil, gas, and associated hydrocarbons from the Niobrara Formation. Sections 35 and 36, Township 5 North, Range 61 West, 6th P.M. are subject to this Order for the Niobrara Formation.
7. On August 28, 2014, BBC, by its attorneys, filed a verified application (“Application”) pursuant to §34-60-116, C.R.S. for an order to amend Order No. 407-1085 to apply to previously unnoticed parties in an approximate 1280-acre drilling and spacing unit established for the below-described lands (“Application Lands”), for the development and operation of the Niobrara Formation:
Township 5
North, Range 61 West, 6th P.M.
Section 35: All
Section 36: All
6. On October 6, 2014, BBC, by its attorneys, filed with the Commission a written request to approve the Application based on the merits of the verified Application and the supporting exhibits. Sworn written testimony and exhibits were submitted in support of the Application.
7. Land testimony and exhibits submitted in support of the Application by Brian Wert, Senior Landman for BBC, showed that BBC holds oil and gas leasehold interests and has a right to drill in the Application Lands.
8. Geologic testimony and exhibits submitted in support of the Application by Charles W. Campbell, Sr. Geologist Advisor for BBC, showed that the Niobrara Formation is present throughout the Application Lands, ranges from approximately 310 feet to 318 feet thick. Further testimony showed that the Niobrara Formation is a sequence of chalks, marls, and limestone sands is a common source of supply.
9. Engineering testimony and exhibits submitted in support of the Application by Kevin Bittel, Senior Reservoir Engineer for BBC, showed that the drainage area for analog horizontal Niobrara Formation wells having a length of between one and two miles are estimated at an average of 78 acres, and an approximate 1280-acre drilling and spacing unit is therefore not less than the maximum area than can be efficiently, economically and effectively drained by a horizontal well producing oil, gas and associated hydrocarbons from the Niobrara Formation.
10. The above-referenced testimony and exhibits show that granting the Application will allow more efficient reservoir drainage, will prevent waste, will assure a greater ultimate recovery of hydrocarbons, and will not violate correlative rights.
11. BBC agreed to be bound by oral order of the Commission.
12. Based on the facts stated in the verified Application, having received no protests, and based on the Hearing Unit review of the Application under Rule 511., the Commission should enter an order to amend Order No. 407-1085 to apply to previously unnoticed parties in an approximate 1280-acre drilling and spacing unit established for Sections 35 and 36, Township 5 North, Range 61 West, 6th P.M., for the production of oil, gas and associated hydrocarbons from the Niobrara Formation.
ORDER
IT IS HEREBY ORDERED:
1. Order No. 407-1085 is hereby amended to apply to previously unnoticed parties in an approximate 1280-acre drilling and spacing unit established for the below-described lands, for the production of oil, gas and associated hydrocarbons from the Niobrara Formation:
Township 5
North, Range 61 West, 6th P.M.
Section 35: All
Section 36: All
IT IS FURTHER ORDERED:
1. The provisions contained in the above order shall become effective immediately.
2. The Commission expressly reserves its right, after notice and hearing, to alter, amend or repeal any and/or all of the above orders.
3. Under the State Administrative Procedure Act, the Commission considers this Order to be final agency action for purposes of judicial review within 35 days after the date this Order is mailed by the Commission.
4. An application for reconsideration by the Commission of this Order is not required prior to the filing for judicial review.
ENTERED this 18th day of November, 2014, as of October 27, 2014.
OIL AND GAS CONSERVATION COMMISSION
OF THE STATE OF COLORADO
By__________________________________
Robert J. Frick, Secretary