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 NIOBRARAB AND CODELL FORMATIONS, WATTENBERG FIELD, WELD COUNTY, COLORADO |
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CAUSE NO. 407
DOCKET NO. 180600409
TYPE: SPACING
ORDER NO. 407-2488 |
REPORT OF THE COMMISSION
The Commission heard this matter on June 11, 2018, at the University of Northern Colorado, 501 20th Street, Greeley, CO 80639, upon application for an order to make Order No. 407-2314, which established an approximate 2,240-acre drilling and spacing unit for Sections 7 and 8, Township 5 North, Range 66 West, 6th P.M. and portions of Sections 11 and 12, Township 5 North, Range 67 West, 6th P.M., and approved 40 horizontal wells within the unit, for the production of oil, gas, and associated hydrocarbons from the Niobrara and Codell Formations, applicable to previously unnoticed parties.
FINDINGS
1. SRC Energy Inc. (Operator No. 10311) (“SRC” 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 January 29, 2018, the Commission entered Order No. 407-2314, which, among other things, established an approximate 2,240-acre drilling and spacing unit for Sections 7 and 8, Township 5 North, Range 66 West, 6th P.M. and portions of Sections 11 and 12, Township 5 North, Range 67 West, 6th P.M., and approved 40 horizontal wells within the unit, for the production of oil, gas, and associated hydrocarbons from the Codell and Niobrara Formations.
5. On April 11, 2018, SRC by its attorneys, filed with the Commission a verified application (“Application”) pursuant to §34-60-116, C.R.S., for an order to make Order No. 407-2314, which established an approximate 2,240-acre drilling and spacing unit for the below-described lands (“Application Lands”), and approved 40 horizontal wells within the unit, for the production of oil, gas and associated hydrocarbons from the Niobrara and Codell Formations, applicable to previously unnoticed interest owners:
Township 5 North, Range 66 West, 6th P.M.
Section 7: All
Section 8: All
Township 5 North, Range 67 West, 6th P.M.
Section 11: N˝
Section 12: All
6. On May 14, 2018, SRC, 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 Kaitlyn Tobin, Landman for SRC, showed that certain interested parties within the established drilling and spacing unit were inadvertently not provided notice of the underlying application pursuant to §34-60-108, C.R.S. and Commission Rule 507.b.(1). Based upon the examination of the relevant documents and records, the previously unnoticed interested parties within the drilling and spacing unit have now been duly served with the Application and associated Notice of Hearing.
8. 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.
9. SRC agreed to be bound by oral order of the Commission.
10. Based on the facts stated in the verified Application, having received no protests, and based on the Hearing Officer review of the Application under Rule 511., the Commission should enter an order to make Order No. 407-2314, which established an approximate 2,240-acre drilling and spacing unit for the Sections 7 and 8, Township 5 North, Range 66 West, 6th P.M. and certain portions of Sections 11 and 12, Township 5 North, Range 67 West, 6th P.M., and approved 40 horizontal wells within the unit, for the production of oil, gas, and associated hydrocarbons from the Niobrara and Codell Formations, applicable to previously unnoticed parties.
ORDER
IT IS HEREBY ORDERED:
1. Pursuant to the provisions of §34-60-116, C.R.S., as amended, of the Oil and Gas Conservation Act, Order No. 407-2314, which established an approximate 2,240-acre drilling and spacing unit for Sections 7 and 8, Township 5 North, Range 66 West, 6th P.M. and portions of Sections 11 and 12, Township 5 North, Range 67 West, 6th P.M., and approved 40 horizontal wells within the unit, for the production of oil, gas, and associated hydrocarbons from the Niobrara and Codell Formations, are hereby applicable to previously unnoticed parties:
Township 5 North, Range 66 West, 6th P.M.
Section 7: All
Section 8: All
Township 5 North, Range 67 West, 6th P.M.
Section 11: N˝
Section 12: All
2. The production obtained from the drilling and spacing unit shall be allocated to each owner in the unit on the basis of the proportion that the number of acres in such tract bears to the total number of mineral acres within the drilling and spacing unit; each owner of an interest in the drilling and spacing unit shall be entitled to receive its share of the production of the Wells located on the drilling and spacing unit applicable to its interest in the drilling and spacing unit.
3. Nothing in this order is intended to conflict with §34-60-116, C.R.S., as amended. Any conflict that may arise shall be resolved in favor of the statute.
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 9th day of July, 2018, as of June 11, 2018.
OIL AND GAS CONSERVATION COMMISSION
OF THE STATE OF COLORADO
By___________________________________
Julie Spence Prine, Secretary