BEFORE THE OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO
IN THE MATTER OF THE INVESTIGATION TO TAKE MEASURES TO PREVENT WASTE OF OIL AND GAS IN THE ATWOOD-EAST FIELD, LOGAN COUNTY, COLORADO	) ) ) )	CAUSE NO. 65 ORDER NO. 65-2

REPORT OF THE COMMISSION

This Cause was originally set for hearing before the Commission on June 20, 1955, in the Pine Room of the Albany Hotel, Denver, Colorado, after publication of Notice of Hearing as required by law, upon the Commission's own motion to take further measures to prevent the waste of oil and gas in the "D" sand in Atwood-East Field, Logan County, Colorado, and was continued to August 16, 1955, at 10:00 a.m., in Room 330 State Office Building, Denver, Colorado.

The Commission now has before it all of the testimony and evidence relating to the production of oil and gas from the "D" sand of the Atwood-East Field, and is fully advised in all matters pertaining to the operations of the field, and believes that it is now in a position to enter a further order in this proceeding, providing for measures to be taken by the operators to prevent the waste of oil and gas in said field.

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 the "D" sand formation in the Atwood-East Field, as used herein, constitutes a common source of supply underlying the following described lands in Logan County, Colorado, to-wit:

Township 6 North; Range. 53 West, 6th P.M.
Sections 1 and 2:  All
Township 7 North, Range 53 West; 6th P.M.
Section 23:  S/2	Section 26:  All
Section 24:  S/2	Section 35:  All
Section 25:  All	Section 36:  All

4.      That in order to prevent undue waste of oil and gas, and to prevent the escaping, blowing, and releasing of gas in an excessive or unreasonable amount from wells producing both oil and gas, and to prevent underground waste, inefficient, excessive, and improper use and dissipation of reservoir energy, the maximum "D" sand production from any one forty-acre tract located in the Atwood-East Field should not, during any one month, exceed a daily average of One Hundred Twenty-five (125) barrels of oil, with a penalty gas-oil-ratio of One Thousand to One (1000 to 1); and that when any well reaches a gas-oil-ratio of Fifteen Thousand to One (15,000 to 1), such well should be shut in pending a gas market; and that upon completion of facilities for said gas market, the maximum production of gas from any one forty-acre tract should not, during any one month, exceed a daily average of One Hundred Twenty-five Thousand (125,000) cubic feet of gas; and that no one well should produce during any twenty-four (24) hour period more than twice its daily allowable; and that the allowable production may be exceeded for any one (1) month by not in excess of three (3) days’ allowable production, provided that any such excess production should be deducted in producing the next month's allowable; and that any underproduction may be produced only during the month immediately following that in which the underproduction occurred.

5.      That the operators and owners of wells producing from the "D" sand formation of the Atwood-East Field should make a gas-oil-ratio test of each of his producing wells during every quarter, beginning with the months of January, April, July and October; and that such tests should be taken during the first fifteen (15) days of the last month of each quarter, the results of which such tests should be reported to the Commission on or before the twentieth (20th) day of the last month of every quarter; and that such tests should be the basis for calculating the volume of gas produced for each month of the following quarter, unless all of the gas produced is metered; and that, immediately prior to making the test for a gas-oil ratio, subject well should be produced at its normal rate of production for at least twenty-four (24) hours; and that during such tests subject well should be produced at a volume equal to or not exceeding its daily allowable by more than twenty-five (25) percent, if capable; that initial gas-oil-ratio tests should be taken and reported to the Commission on or before October 15, 1955; and that such tests should be the basis for calculating the volume of gas produced for each month of the last quarter of 1955; and that a schedule should be submitted to the Commission and offset operators prior to testing, showing the wells and respective dates of tests; and that the volume of gas measured should be reported in units of cubic feet at a base pressure of 15.025 psia, and a base temperature of 60° Fahrenheit.

6.      That in order to prevent waste of gas, as defined in the Oil and Gas Conservation Act, and to prevent the drilling of unnecessary wells, an order should be made establishing the following drilling and spacing units for the production of gas from the said "D" sand formation, common source of supply underlying said land as set forth below:

			DRILLING UNIT I
			Lots One (1), Two (2) and Three (3), South Half of Northeast Quarter (S/2 NE/4), Southeast Quarter of Northwest Quarter (SE/4 NW/4), East Half of Southwest Quarter (E/2 SW/4), and Southeast Quarter (SE/4) of Section One (1), Township Six (6) North, Range Fifty-three (53) West of the 6th P.M., Logan County, Colorado,
		and the permitted gas well for this unit should be the Shell Oil Company's State 694 #B-1 well, located in Lot Two (2) in the Northwest Quarter of the Northeast Quarter (NW/4 NE/4) of Section One (1), Township Six (6) North, Range Fifty-three (53) West.
			DRILLING UNIT II
			South Half of Northeast Quarter (S/2 NE/4), Southeast Quarter of Northwest Quarter (SE/4 NW/4), East Half of Southwest Quarter (E/2 SW/4), and Southeast Quarter (SE/4) of Section Twenty-five (25), Township Seven (7) North, Range Fifty-three (53) West of the 6th P.M., Logan County, Colorado,
	and the permitted gas well for this unit should be the Strain Drilling Company, et al Kaepernick #1 well, located in the Center of the Southwest Quarter of the Northeast Quarter (SW/4 NE/4) of Section Twenty-five (25), Township Seven (7) North, Range Fifty-three (53) West.
			DRILLING UNIT III
			East Half of the West Half (E/2 W/2), and East Half (E/2) of Section Thirty-six (36), Township Seven (7) North, Range Fifty-three (53) West of the 6th P.M., Logan County, Colorado,
and the permitted gas well for this unit should be the Stanolind Oil and Gas Company's State F #1 well, located in the Center of the Northwest Quarter of the Southeast Quarter of the Southwest Quarter (NW/4 SE/4 SW/4) of Section Thirty-six (36), Township Seven (7) North, Range Fifty-three (53) West.

ORDER

NOW, THEREFORE, IT IS ORDERED, that the following rules and regulations be, and the same are, hereby adopted for the "D" sand formation of the Atwood-East Field in Logan County, Colorado.

Rule 1.    That the "D" sand formation of the Atwood-East Field, as used herein, constitutes a common source of supply underlying the following described lands in Logan County, Colorado, to-wit:

Sections One (1) and Two (2), Township Six (6) North, Range Fifty-three (53) West of the 6th P.M.; and Sections Twenty-five (25), Twenty-six (26), Thirty-five (35), and Thirty-six (36), and the South Half (S/2) of Sections Twenty-three (23) and Twenty-four (24), Township Seven (7) North, Range Fifty-three (53) West of the 6th P.M., all in Logan County, Colorado.

Rule 2.    That in order to prevent undue waste of oil and gas, and to prevent the escaping, blowing, and releasing of gas in an excessive or unreasonable amount from wells producing both oil and gas, and to prevent underground waste, inefficient, excessive, and improper use and dissipation of reservoir energy, the maximum "D" sand production from any one forty-acre tract located in the Atwood-East Field shall not, during any one (1) month, exceed a daily average of One Hundred Twenty-five (125) barrels of oil, with a penalty gas-oil-ratio of One Thousand to One (1000 to 1); and that when any well reaches a gas-oil-ratio of Fifteen Thousand to One (15,000 to 1), such well shall be shut in pending a gas market; and that upon completion of facilities for said gas market, the maximum production of gas from and one (1) forty-acre tract shall not, during any one month, exceed a daily average of One Hundred Twenty-five Thousand (125,000) cubic feet of gas; and that no one well shall produce during any twenty-four (24) hour period more than twice its daily allowable; and that the allowable production may be exceeded for any one (1) month by not in excess of three (3) days allowable production, provided that any such excess production shall be deducted in producing the next month's allowable; and that any underproduction may be produced only during the month immediately following that in which the underproduction occurred.

Rule 3.    That the operators and owners of wells producing from the "D" sand formation of the Atwood-East Field shall make a gas-oil-ratio test of each of his producing wells during every quarter, beginning with the months of January, April, July and October; and that such tests shall be taken during the first fifteen (15) days of the last month of each quarter, the results of which such tests shall be reported to the Commission on or before the twentieth (20th) day of the last month of every quarter; and that such tests shall be the basis for calculating the volume of gas produced for each month of the following quarter, unless all of the gas produced is metered; and that, immediately prior to making the test for a gas-oil ratio, subject well shall be produced at its normal rate of production for at least twenty-four (24) hours; and that during such tests subject well shall be produced at a volume equal to or not exceeding its daily allowable by more than twenty-five (25) percent, if capable; that initial gas-oil-ratio tests shall be taken and reported to the Commission on or before October 15, 1955; and that such tests shall be the basis for calculating the volume of gas produced for each month of the last quarter of 1955; and that a schedule shall be submitted to the Commission and offset operators prior to testing, showing the wells and respective dates of tests; and that the volume of gas measured shall be reported in units of cubic feet at a base pressure of 15.025 psia, and a base temperature of 60° Fahrenheit.

Rule 4.    The following drilling and spacing units shall be, and the same are hereby established for the production of gas from the "D" sand formation of the Atwood-East Field, common source of supply underlying:

DRILLING UNIT I

Lots One (1), Two (2) and Three (3), South Half of Northeast Quarter (S/2 NE/4), Southeast Quarter of Northwest Quarter (SE/4 NW/4), East Half of Southwest Quarter (E/2 SW/4), and Southeast Quarter (SE/4) of Section One (1), Township Six (6) North, Range Fifty-three (53) West of the 6th P.M., Logan County, Colorado,

	and the permitted gas well for this unit should be the Shell Oil Company's State 694 #B-1 well, located in Lot Two (2) in the Northwest Quarter of the Northeast Quarter (NW/4 NE/4) of Section One (1), Township Six (6) North, Range Fifty-three (53) West.
		DRILLING UNIT II
		South Half of Northeast Quarter (S/2 NE/4), Southeast Quarter of Northwest Quarter (SE/4 NW/4), East Half of Southwest Quarter (E/2 SW/4), and Southeast Quarter (SE/4) of Section Twenty-five (25), Township Seven (7) North, Range Fifty-three (53) West of the 6th P.M., Logan County, Colorado,
and the permitted gas well for this unit should be the Strain Drilling Company, et al Kaepernick #1 well, located in the Center of the Southwest Quarter of the Northeast Quarter (SW/4 NE/4) of Section Twenty-five (25), Township Seven (7) North, Range Fifty-three (53) West.
		DRILLING UNIT III
		East Half of the West Half (E/2 W/2), and East Half (E/2) of Section Thirty-six (36), Township Seven (7) North, Range Fifty-three (53) West of the 6th P.M., Logan County, Colorado,

IT IS FURTHER ORDERED, that this order shall become effective October 1, 1955.

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 8th day of September, 1955.

OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO
	By  Annabel Hogsett, Secretary