BEFORE THE OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO
IN THE MATTER OF THE PROMULGATION AND ESTABLISHMENT OF FIELD RULES TO GOVERN OPERATIONS IN THE BISON FIELD, WASHINGTON COUNTY, COLORADO	) ) ) )	CAUSE NO. 163 ORDER NO. 163-2

REPORT OF THE COMMISSION

This cause came on for hearing before the Commission on April 19, 1966, at 10 a.m., in Room 132, State Services Building, Denver, Colorado, after publication of Notice of Hearing and service or appropriate waiver thereof, on the application of Tipps Drilling Company for an order granting exceptions to Order No. 163-1 for two test wells to be drilled in the center of the NW¼NE¼NE¼ and the center of the NW¼SE¼NE¼ of Section 18, Township 4 South, Range 53 West, 6th P.M., Washington County, Colorado, with said wells to be located no closer than 330 feet to the boundaries of the tracts upon which they are located.

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 Commission, by its Order No. 163-1, among other things, establishes 40-acre drilling units for the production of oil and gas from the "J" sand formation underlying the Bison Field, and that the SE¼NE¼ and the NE¼NE¼, Section 18, Township 4 South, Range 53 West, 6th P.M., Washington County, Colorado, constitute two of said units.

4.      That test wells have been drilled in the center of each of the aforementioned drilling units as the permitted well for such units, and that each of these wells was plugged and abandoned as a dry hole.

5.      That geological and engineering testimony presented at the hearing indicates that each of said units is located partly outside of the pool, and both are adjacent to a producing unit and that therefore, in order to protect the correlative rights, exceptions to Order No. 163-1 should be granted for a well to be drilled in the approximate center of the NW¼NE¼NE¼, and the center of the NW¼SE¼NE¼ of said Section 18, and that neither well should be located close than 330 feet to the boundaries of the 40-acre tracts upon which they are located.

6.      That if a commercial well is completed at either or both of the locations set forth above, upon application of any interested party, and after notice of hearing, the Commission should take such action as will offset any advantage the operator of such exceptions may have over other producers by the drilling of the wells as exceptions, and should include in the order suitable provisions for prevention of production from said drilling unit of more than its just and equitable share of the oil and gas in said pool.

7.      That the operator of the wells drilled as exceptions to said Order No. 163-1 should take and analyze cores and/or make logs, whichever is necessary for determination of reservoir data relating to the "J" sand formation underlying the NE¼NE¼, and the SE¼NE¼ of said Section 18.

ORDER

NOW, THEREFORE, IT IS ORDERED  that exceptions shall be granted or wells to be drilled in the center of the NW¼NE¼NE¼ and the center of the NW¼SE¼NE¼ of Section 18, Township 4 South, Range 53 West, 6th P.M., Washington County, Colorado but that in no event shall such test well be located closer than 330 feet from the boundaries of the 40-acre tracts upon which they are located, and said wells shall be the permitted wells for the drilling unit upon which they are located.  However, if a commercial well is drilled on either or both of the locations set forth above instead of on locations as provided in Order No. 163-1, the Commission shall, at the request of interested persons, take such action as will offset any advantage the person securing the exception may have over other producers by reason of the drilling of said wells as exceptions.

ORDERED this 19th day of April 1966.

OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO
	By	William R. Smith, Secretary