REPORT OF THE COMMISSION

TO ALL INTERESTED PARTIES AND TO WHOM IT MAY CONCERN:

This cause came on for hearing before the Commission on August 17, 1987, at 9:00 A.M., in Room 100, State Centennial Building, 1313 Sherman Street, Denver, Colorado, after giving Notice of Hearing as required by law on the verified application of J.W. Gibson, for an order amending Order No. 388-1 and allow an exception to the permitted well location as established by Order No. 388-1 for the drilling and spacing units consisting of Section 27 and 28, Township 19 South, Range 47 West, 6th P.M., Neenoshe Field, Kiowa County, Colorado.

FINDINGS

1. J.W. Gibson, as applicant herein, is an interested party in the subject matter of the above-referenced hearing.

2. Due to 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 embrace in said Notice, and of the parties interested therein, and jurisdiction to promulgate the hereinafter prescribed order.

4. The Commission on August 16, 1982, authorized Order No. 388-1 to be issued by which 640-acre drilling and spacing unit were established for production of gas and associated hydrocarbons from the Middle Morrow Sand underlying certain lands in Kiowa County, Colorado which includes Section 27 and 28, Township 19 South, Range 47 West, 6th P.M. as spacing and drilling unit. The permitted well location for the Section 27 unit is at a location in the SW/4 NW/4 and for Section 28 unit at a location in the SE/4 NE/4.

5. Based on the facts stated in the verified application and having received no objections and having been heard by the Director as Hearing Officer and recommended for approval, the Commission should enter an order amending Order No. 388-1 granting an exception to the permitted well locations as established by Order No. 388-1 for the drilling and spacing units consisting of said Sections 27 and 28 by allowing the permitted well location for a well drilled, completed or recompleted in the Morrow Sand to be at any other location within said sections to include the existing permitted well location, so long as any location is no closer than 600 feet from the boundaries of the section.

ORDER

NOW THEREFORE IT IS ORDERED, that Order No. 388-1 is hereby amended and an exception to the permitted well location as established by said Order is hereby granted for a well drilled, completed, or recompleted in the Morrow Sand underlying each drilling and spacing unit consisting of Sections 27 and 28, Township 19 South, Range 47 West, 6th P.M. shall be at any location, including the existing permitted well location, so long as the location is no closer than 600 feet from the boundaries of the section.

IT IS FURTHER ORDERED, that 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 3rd day of September 1987, as of August 17, 1987.

THE OIL AND GAS CONSERVATION COMMISSION OF THE STATE OF COLORADO

By Frank J. Piro, Secretary

(388-4)