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RESOLUTION
RE: APPROVE CONSENT TO COMMINGLING WITH BASIN EXPLORATION AND AUTHORIZE
CHAIRMAN TO SIGN
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o WHEREAS, the Board of County Commissioners of Weld County, Colorado,
Upursuant to Colorado statute and the Weld County Home Rule Charter, is vested
with the authority of administering the affairs of Weld County, Colorado, and
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. WHEREAS, Weld County, Colorado, has received a Consent to Commingling with
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W Basin Exploration, 633 17th Street, Suite 1500, Denver, Colorado 80202, and
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W WHEREAS, said Consent to Commingling covers land more particularly
N a described as follows:
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Township 2 North, Range 65 West, 6th P.M.
Section 18: SE4
Fw7 Weld County, Colorado
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W WHEREAS, Weld County is entitled to a one-eighth royalty interest on
c Cfl production, and
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H W WHEREAS, in order to receive said royalty interest, Weld County must
execute said Consent to Commingling, a copy of which is attached hereto and
Nincorporated herein by reference, and
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aWHEREAS, said Consent to Commingling has been reviewed by a member of the
Weld County Attorney's staff and found to be in order, and
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o WHEREAS, the Board deems it advisable to approve said Consent to
W Commingling on the parcel of land described herein.
NOW, THEREFORE, BE IT RESOLVED by the Board of County Commissioners of Weld
County, Colorado, that the Consent to Commingling with Basin Exploration, 633
17th Street, Suite 1500, Denver, Colorado 80202, on the hereinabove described
parcel of land be, and hereby is, approved.
BE IT FURTHER RESOLVED by the Board that the Chairman be, and hereby is,
authorized to sign said Consent to Commingling.
910592
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RE: CONSENT TO COMMINGLING - BASIN EXPLORATION
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The above and foregoing Resolution was, on motion duly made and seconded,
N O adopted by the following vote on the 8th day of July, A.D. , 1991.
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CJ BOARD OF COUNTY COMMISSIONERS
c 3 ATTEST: 4.4410/Nagth
WELD COUNT RAD
w W Weld County Clerk to the Board
Gord acy, an
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iN a Dip k to the Boar George Ken y, Pro-Tem
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�o APPROIEL, - ORM: EXCUSED
WConstance L. Harbert
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ro z ounty Attorney C. W. Kir y
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a' W. H. Webster
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910592
•-e� BASIN •
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EXPLOR TION
CO O �k4 INC.
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• June 26, 1991
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403-
2 Board of County Commissioners
U Weld County
cy P. 0. Box 758
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i Greeley, CO 80631
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W Re: Consent to Commingling
H v Muse #2 Well
z SE/4 Sec. 18-T2N-R65W
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,.4 H Weld County, Colorado
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Dear Interest Owner:
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N W Basin Operating Company ("Basin) proposes to produce oil and gas from both the
r+ k� "J" Sandstone Formation, as well as the Codell and Niobrara Formations of the
N z referenced Well. Basin believes that this method of producing oil and gas from
N the Well will maximize the recovery of mineral resources and will benefit all
o parties with interests in the Well. However, the designated producing unit for
Wa (4 the "J" Sandstone Formation in this Well is 320 acres, while the designated
producing unit for the Codell and Niobrara Formations in the Well is 160 acres.
A description of the respective units, along with your participation in each of
ow the units are as further set out on Exhibit "A", attached hereto.
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w In order to commingle production from these different formations and units, the
Oil and Gas Conservation Commission of the State of Colorado ("Commission")
provides that Basin may obtain your consent. The Commission also provides that
Basin may obtain your agreement to a method, or formula, whereby the common
production stream will be allocated between the two producing units. Basin is
proposing the allocation formula described on Exhibit "B", attached hereto,
which is self-explanatory.
If you consent to commingling of the "J" Sandstone Formation along with the
Codell and Niobrara Formations in the referenced Well, and further agree to the
proposed allocation method for allocating oil and gas production between the two
separate producing units, please date and sign one original copy of this letter,
in the space provided below, have your signature acknowledged before a notary
public, and return one, original, executed and acknowledged copy of the letter
to Basin at the address set out below.
633 17th Street,Suite 1500 • Denver, Colorado 80202 • Office 303-292-2322 • FAX 303-292-0050
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. June 26, 1991
▪ U Muse #2
A Page Two
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a4 If you have any questions concerning this matter, please feel free to contact
ur w Mr. Dan Schwartz of Basin at the address set out on this letterhead.
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�O Sincerely. ?/
N W „Pa 1 �.I� V
• w AMMI
Dan L. Schwartz
W Land Manager
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ACCEPTED AND AGREED TO THIS 0 - DAY OF .10 QJ {/ ' , 1991.
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�W BOARD or COUNTY CONS$IONERS - WELD COUNTY
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N W BY: e x,t. ATTEST:
Title: WELD OUNTY CLERK TO THE BOARD
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BY:
EPUTY CLERK .0 THE BOAR
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STATE OF )
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• w The foregoing instrument was acknowledged before me this day of
1991, by , as
of , on behalf of the
corporation.
Witness my hand and official seal.
My Commission Expires:
Notary Public
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O EXHIBIT "A"
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o a SE/4 Section 18
A 160.0 acre spacing unit limited to the Codell and
Niobrara formations
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OWNER NAME & ADDRESS NET REVENUE INTEREST
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H x Associated Natural Gas, Inc. 76.69922
W 370 - 17th Street, Suite 900
rn U Denver, CO 80202
N Z Potts Farm Account 11.62110%
n E c/o Harvey O. Potts
am P. 0. Box 237
W Meade, CO 80542
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ti w Energy Minerals Corporation 4.648448
Z 999-18th Street, Suite 3100
N Denver, CO 80202
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u >4 Board of County Commissioners ,878908
Weld County
P. 0. Box 758
CD Greeley, CO 80631
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Amoco Production Company 6.152348
an w P.O. Box 800
Denver, CO 80202
-3-
.910532
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00 3 EXHIBIT "A" (cont'd)
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2 E/2 Section 18
U320.0 acre spacing unit
r, limited to the "J" Sand formation
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o OWNER NAME & ADDRESS NET REVENUE INTEREST
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Tommy D. Ables .203658
U RR 23, Box 141, Edna Lane
Tyle, TX 75703
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EAmoco Production Company 2.519538
r.O CO P.O. Box 800
W Denver, CO 80202
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N GI Carol Bell 1.464848
�p 30263 Weld County Road 8
N 2 Xeenesburg, CO 80643
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o Norman M. Bodily
U 8210 Lake Bend Drive •203658
a Roulett, TX 75088
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Phyllis Bollman 1.464848
M w 50 Albion St.
H o Denver, CO 80220
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John D. Cranor 1.000008
5735 S. Ivy
Englewood, CO 80111
Energy Minerals Corporation 2.324238
999-18th Street, Suite 3100
Denver, CO 80202
Fayrene Meyers 1.464858
2949 S. Patton Ct.
Denver, CO 80236
Eugene Muse 1.464858
635 S. Fulton Ave.
Ft. Lupton, CO 80621
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A EXHIBIT "A" (cont'd)
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o a4 Maynard W. Nichols 585948
v► W 18938 Weld County Road 22 -
C4 Ft. Lupton, CO 80621
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ro aU Basin Operating Company 80.239028
633-17th Street, Suite 1500
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Denver, CO 80202
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`~ Potts Farm Account
5.810548
a c/o Harvey O. Potts
el ON U P.O. Box 237
N Meade, CO 80542
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H Robert L. Snyder 614618
o to c/o Nielson Enterprises Inc.
W P.O. Box 370
n p Cody, WY 82414
N W
e Board of County Commissioners .439458
N Z Weld County
cv P.O. Box 758
o Greeley, CO 80631
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EXHIBIT "B"
PROPOSED ALLOCATION METHOD
"Production"
c u The "Production Method" of allocation assigns monthly volumes of
0 oil and gas to each formation which is commingled within a single
co o wellbore. The volumes are determined by estimating the reserves
for each formation using actual production histories. The oil
a and gas reserves for each formation are then used to establish
o w the contribution of each formation to the total recovery from the
0 3 well. The ratios between each formation will remain the same for
44- w the life of the well. The procedure is as follows:
2 1. Calculate the "J" Sand reserves for the subject well.
Ng• 2. Plug back the "J" Sand and complete the Codell formation.
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0 3. Produce the Codell formation a minimum of three months to
w establish a stabilized production trend.
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C-) 4. Calculate the Codell reserves for the subject well.
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W 5. Determine the ratio of gas reserves on an MMBTU basis and the
c oil reserves for each formation for each year of the life of
W the well.
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NZ 6 . Allocate monthly production for each year based on the
a z projected oil and gas ratios calculated for that year.
col 7. Example of allocation:
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W Let Al - "J" Sand Oil Reserves for Year
x Let A2 - "J" Sand Gas Reserves for Year
Let B1 - Codell Oil Reserves for Year
CO CO^ Let B2 - Codell Gas Reserves for Year
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w w Total Oil Reserves for Year - Al + 81
Total Gas Reserves for Year - A2 + B2
"J" Sand Oil Allocation Factor for Year - (A1/ (A1+B1 ) )
"J" Sand Gas Allocation Factor for Year - (A2/ (A2+B2) )
Codell Oil Allocation Factor for Year - (B1/ (A1+B1) )
Codell Gas Allocation Factor for Year - (B2/ (A2+B2) )
8. All "J" Sand royalty owners within the standard 320 acre "J"
Sand spacing unit will be paid based on the "J" Sand
allocation, and all Codell royalty owners within the standard
80 acre Codell spacing unit will be paid based based upon the
Codell allocation.
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