REPORT TO THE COMMISSION

This cause came on for hearing before the Commission on February 19, 1982 at 9:00 A.M. in Room 110, State Centennial Building, Denver, Colorado, after giving Notice of Hearing as required by law, on the application of Chandler & Associates, Inc., for an order extending the field limits of the Craig-North Field, and establishing for the additional area 320-acre drilling and spacing units for the production of gas from a member of the Upper Lewis formation, known locally as the Basal Lance, as provided for in Order No. 113-1, except that the units in Section 21, Township 8 North, Range 90 West should be designated as the E/2 and W/2, and in Section 22, Township 8 North, Range 90 West, the units should be designated as the N/2 and S/2. The application was amended at the time of hearing to delete the request for the designated units in said Sections 21 and 22, and that said units be at the discretion of the operator, and that Well No. 15-22 McWilliams, located in the SW/4SE/4 of said Section 22 be considered an exception and be the permitted well for the unit consisting of the S/2 of said Section 22.

FINDINGS

The Commission finds as follows:

1. Chandler & Associates, Inc., as applicants 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. On November 26, 1957, the Commission issued its Order No. 113-1 which, among other things, established 320-acre drilling and spacing units for the pro-duction of gas from a member of the Upper Lewis formation, known locally as the Basal Lance, underlying the Craig-North Field, and the permitted well for each unit is located in the NE/4 or the SW/4 of each section and not less than 660 feet from the boundaries of the unit.

5. Testimony presented at the hearing indicates a common source of supply of gas underlies, in addition to the area set forth in Order No. 113-1, the follow-ing described lands in Moffat County, Colorado, to-wit:

Township 8 North, Range 90 West, 6th P.M. Section 15: All Section 23: All Section 21: All Section 26: All Section 22: All Section 27: All and that such additional lands be made subject to the provisions of Order No. 113-1 and that the units consist of the N/2 and S/2 or the E/2 and W/2 of each section, which units be designated at the time of filing the permit to drill, and that the permitted well be located to the NE/4 and SW/4 of each section and no closer than 660 feet from the boundaries of the unit; however, an exception should be allowed for Well No. 15-22 McWilliams, located in the SW/4SE/4 Section 22, Township 8 North, Range 90 West, 6th P.M., and that it be the permitted well for the unit consisting of the S/2 of said Section 22.

(over)

ORDER

NOW, THEREFORE IT IS ORDERED, that the area set forth in Finding 5 herein shall be subject to the provisions of Order No. 113-1 and that the units shall consist of the N/2 and S/2 or the E/2 and W/2 of each section, which units shall be designated at the time of filing the permit to drill, and the permitted well shall be located in the NE/4 and SW/4 of each section and no closer than 660 feet from the boundaries of the unit; how-ever, Well No. 15-22 McWilliams, located in the SW/4SE/4 Section 22, Township 8 North, Range 90 West, shall be considered an exception and be the permitted well for the unit consisting of the S/2 of said Section 22.

IT IS FURTHER ORDERED, that the spaced area of the Craig-North Field shall henceforth include the following described lands in Moffat County, Colorado, to-wit:

Township 8 North, Range 90 West, 6th P.M. Section 15: All Section 27: All Section 19: All Section 28: All Section 21: All Section 29: All Section 22: All Section 30: All Section 23: All Section 32: All Section 26: All Section 33: All Township 8 North, Range 91 West, 6th P.M. Section 23= All Section 26: All Section 24: All Section 35: All Section 25: All Section 36: All

IT IS FURTHER ORDERED, that the provisions contained in the above orders 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 16th day of March 1982, as of February 19, 1982.

THE OIL AND GAS CONSERVATION COMMISSION OF THE STATE COLORADO

By Frank J. Piro, Secretary

(#113-6)