REPORT OF THE COMMISSION

This cause came on for hearing before the Commission on November 15, 1993, in Room 318, State Centennial Building, 1313 Sherman, Denver, Colorado, after giving Notice of Hearing, as required by law on the application of Union Pacific Resources Company, for an order to extend the limits of the spaced area in the Speaker Field, for the production of oil and associated hydrocarbons from the Morrow Formation.

FINDINGS

The Commission finds as follows:

1. Union Pacific Resources Company as applicant herein, are interested parties 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.

4. In Order No. 490-1 the Commission established 80-acre drilling and spacing units for the production of oil and associated hydrocarbons from the Morrow Formation underlying certain lands in the Speaker Field, with the units to consist of the N1/2 and S1/2 or the E1/2 and W1/2 of a governmental quarter section, with the permitted well to be located in the SW1/4 and the NE1/4 of each quarter section and no closer than 400 feet from the boundaries of the unit. Further, the order allowed the Director to grant exceptions to well locations provided that the owners proposing to drill a well, file with the Commission a waiver or consent signed by the lease owner toward whom the well location is proposed to be moved or if the owner of the proposed well is also the owner of the lease on the property toward which the well is proposed to be moved, a waiver shall be obtained from the mineral interest owner of the lands covered by the offset lease.

5. This matter was heard by the Hearing Officer who recommends approval based upon the geological and engineering testimony presented at the administrative hearing that indicates a common source of supply of oil underlies, in addition to the area set forth in Order No. 490-1, the following described lands in Cheyenne and Kit Carson Counties, to-wit:

Township 11 South, Range 50 West, 6th P.M. Sections 19 and 20: All Sections 29 through 32: All

Township 11 South, Range 51 West, 6th P.M. Sections 23 through 26: All Sections 35 and 36: All

Township 12 South, Range 50 West, 6th P.M. Sections 6 and 7: All Sections 18 and 19: All

Township 12 South, Range 51 West, 6th P.M. Section 24: All

6. No objections to the application were received and an order of the Commission should be entered extending the limits of the spaced area of the Speaker Field, for production from the Morrow Formation.

ORDER

NOW, THEREFORE, IT IS ORDERED, that the area set forth in Finding 5 herein shall be subject to the provisions of Order No. 490-1, and the spaced area of the Speaker Field shall henceforth include the following described lands in Cheyenne and Kit Carson Counties, Colorado, to-wit:

Township 11 South, Range 50 West, 6th P.M. Sections 19 and 20: All Sections 29 through 32: All

Township 11 South, Range 51 West, 6th P.M. Sections 23 through 26: All Sections 35 and 36: All

Township 12 South, Range 50 West, 6th P.M. Sections 6 and 7: All Sections 18 and 19: All

Township 12 South, Range 51 West, 6th P.M. Sections 1 through 3: All Sections 10 through 15: All Section 24: All

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 December, 1993, as of November 15, 1993.

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 December 3, 1993 ??

(490#3)