August 31, 1995

Mr. William J. LeMay, Director New Mexico Oil Conservation Division 2040 S. Pacheco Street P. O. Box 6429 Santa Fe, NM 87505

Application for Exception to Rule 303-C Downhole Commingling Jicarilla "B" #2E Well 1640' FSL & 1520* F E L , Unit J Section 16-T26N-R5W Basin Dakota and Otero Chacra Pools Rio Arriba County. New Mexico

Amoco Production Company hereby requests administrative approval to downhole commingle production from the Basin Dakota and Otero Chacra Pools in the Jicarilla "B" #2E Well referenced above. The Jicarilla "B" #2E well was originally a dual completion in the Dakota and Chacra formations. The two zones are expected to produce at a total commingled rate of about 165 MCFD with 6 BOPD. The ownership (WI, RI,ORI) of these pools is identical in this wellbore. Downhole commingling will offer an economical method of production while protecting against reservoir damage, waste of reserves and violation of correlative rights.

The allocation method that we plan to use for this commingled well is as follows. Since these formations have been producing for some time, we have a good historical representation of the production by formation. Based on historical production we recommend that the allocation for gas production be 55% from the Dakota formation and 45% from the Chacra formation. The Chacra has not historically produced liquids in this well. Based on that fact, we propose to allocate 100% of the liquid production to the Dakota formation. The actual commercial value of the commingled production will not be less than the sum of the values of the production from each of the common sources of supply.

Attached to aid in your review are plats showing the location ofthe well and offset wells in the same formations, a historical production plot and a C-l02 for each formation. Amoco is the operator in all offsetting spacing units on this lease so no notification to offset owners is necessary. This spacing unit is on a federal lease and a copy of the application will be sent to the BLM as required.

Amoco 1670 Broadway Post Office Box 800 Denver, Colorado 80201

Should you have questions concerning this matter, please contact me at (303)

Sincep

Pamela W. Staley

Enclosures

cc: Steve Smethie Patty Haefele

Frank Chavez, Supervisor NMOCD District I I I 1000 Rio Brazos Road Aztec, NM 87410

Robert Kent Bureau of Land Management 435 MontanoNE Albuquerque, NM 87107

Application for Exception to Rule 303: SEGREGATION OF PRODUCTION FROM POOLS

Requirements

(1) Name and address of the operator:

Amoco Production Company P.O. Box 800 Denver, CO 80201

(2) Lease name, well number, well location, name ofthe pools to be commingled:

Lease Name: Jicarilla "B" Well Number: 2E Well Location: 1640' FSL & 1520' FEL

Unit J Section 16-T26N-R5W Rio Arriba County, New Mexico

Pools Commingled: Otero Chacra

Basin Dakota

(3) A plat of the area showing the acreage dedicated to the well and the ownership of all offsetting leases.

Attached (4) A current (within 30 days) 24-hour productivity test on Division Form C-l 16 showing the amount of oil, gas

and water produced from each zone.

The Dakota produced an average stabilized rate of 18 MCFD and 1.9 BCPD. The Chacra zone produced at an average rate of about 67 MCFD and 0 BCPD.

(5) A production decline curve for both zones showing that for a period of at least one year a steady rate of decline has been established for each zone which will permit a reasonable allocation of the commingled production to each zone for statistical purposes.

Otero Chacra Completion: Historical production curve attached. Basin Dakota Completion: Historical production curve attached.

(6) Estimated bottomhole pressure for each zone. A current (within 30 days) measured bottom hole pressure for each zone capable of flowing.

Bottomhole pressures were estimated from OCD Packer Leakage Tests. Shut-in bottomhole pressure in the Chacra formation is calculated to be 1127 PSIG while estimated bottomhole pressure in the Mesaverde formation is 1755 PSIG. Therefore these pressures meet the pressure differential rule under article 303-C (b)(vi). See attached calculation and packer leakage test results.

(7) A description of the fluid characteristics of each zone showing that the fluids will not be incompatible in the wellbore.

The fluids in the Dakota have no abnormal components that would prohibit commingling, or promote the creation of emulsions or scale when commingled with the Chacra formation.

(8) A computation showing that the value of the commingled production will not be less than the sum of the values ofthe individual streams:

The BTU content ofthe produced streams are very similar and as such, we would expect the commingled production to have the same value as the sum ofthe individual streams.

(9) A formula for the allocation of production to each of the commingled zones and a description of the factors or data used in determining such formula:

Based on historical production we recommend that the allocation for gas production be 55% from the Dakota formation and 45% from the Chacra formation. The Chacra has not historically produced liquids in this well. Based on that fact, we propose to allocate 100% of the liquid production to the Dakota formation. The actual commercial value ofthe commingled production will not be less than the sum ofthe values ofthe production from each ofthe common sources of supply.

(10) A statement that all offset operators and, in the case of a well on federal land, the United States Bureau of Land Management, have been notified in writing of the proposed commingling.

BLM will receive a copy of this application by certified mail. The offsetting operators listed on the attached sheet will receive a copy of this application by certified mail.

L.O) to • o-•CO

Ola ••!>-. —• o m.-

WELL: 3-8 LERSE: JIDRRlLLfl OPERRTORi CONSQI .I0RTED QSG RPI: 30039O6B33110 PROO. FORMiPCCF

HELLI 3-E LERSEi JICHRILLf) CONTRACT OPERRTORi CONSOLIORTEQ O&G APIi 3003923S0500 PROO. FORMiGLLP ,0K0T

@HELL: 1-6 LERSEt WEST 961 OPERRTORi OCCIDENTAL PETROLEUM RPI: 300390656400 PROD. FORM:HVRO ,0KOT

tt HELLi 7-E LERSEi JICRRILLR-R OPERRTOR: TENNECO OIL RPIi 3D03S22B9600 PROO. FORM:OKOT WELL I

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riELL / LEASE: JICARILLB-R OPERRTOR: TENNECO OIL RPI: 300390809700 PROD. FORMiDKOT

HELL: 8-E LEASE: JICHRIllLR-fl OPERPTOR: TENIJECD OIL RPI: PROD. FORM:

30039228! 700 :0K( T

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OPERRTOR: PRN AMERICRN RPI: 300392008700 PROO FORHIOKOT

WELL: 5 , LERSE: JICRRILLR RPHCHE

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PROO. FORMsDKOT -$-PROD

iffLL I LERSEi JICRRILLR-RPRCHE Utn i 'TJ" t l W r r U H L W RPI 300390816600

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JFLI 1-1 LEP:EI j:cpRi-LR-fc OPEHHTUR. TENNEC RPI' 300332230000 PROD. FORM.nVRD ,0K0T

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OPERATOR: TENNECO OIL RPI: 3OO390B162OO PROO.rFORfl:BLLP ,GLLP ,DK07

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tt NELL: 2 LERSE: JICflRILLR-B OPERATOR." TENNECO OIL RPI: 3OO390B135D0 PROO. FORN-.CKOT

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HELL: 9 LEASE: JICRRtLLR-fl OPERRTORi TENNECO OIL

, RPI: 300392164300 PROD. FORHiflVRD ,CHCR

HELL 6-E LEASE: JICflRILLR-fl OPERRTORi TENNECO OIL RPI: 3003922B9BOQ PROD. FORMiOKOT

MELLs'S LERSEi JICflflLLR' OPERRTORi RPI: 30039. PROD. FORM

i-n" - ,! OIL!

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HELL' B LERSEi JICflRILLR-fl OPERRTORi TENNECO OIL RPIi 300390813700 PROD. FORfliOKDT

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>rCOPERRTORi TEN1ECO0IL RPI: 30039225)300 PROO. FORfliOKiT

HELL: 2-E LERSEi JICRRI OPERRTOR: TENI Tinr3D039225 PROD. FORMiDKOT

HELL: \ LEASE: OPERRTC RP] i 3t PROD, f

HELL 1 LERSE. JICRRILLR-B OrCPflTJ'. TLNMLCO OIL RPI. 30D390644B0D PROD. FORM OKOT

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36° 27 ' 53 ' ' N 13,244,473.47 FT. N

•~Ls HELL: li-E •Q-LtM'jE i J.LF-M _P 8 ^ OPERATORI TENNECO OIL

RPIi 300392229300 PROD. FORMiOKOT

HELL• 6 LEASE• JICARILLA 8 OPERRTORi TENNECO OIL RPI> 300390B13800 PROD rORM OKOT

36" 27' 53" 13,244,473.47 FT.

Al l g e o l o g i c a l a n d g e o p h y s i c a l d a t a , i n c l u d i n g t h e i n t e r p r e t a t i o n t h e r e o f , a p p e a r i n g on th i s m a p is t he p r i v a t e a n d c o n f i d e n t i a l p r o p e r t y of A m o c o P r o d u c t i o n C o m p a n y . The p u b l i c a t i o n o r r e p r o d u c t i o n t h e r e o f w i t h o u t t h e w r i t t e n p e r m i s s i o n o f s a i d C o m p a n y is s t r i c t l y p r o h i b i t e d .

POLYCONIC CENTRAL MERIDIAN - 107° 2 1 ' 5 0 " W LON SPHEROID - 6

AMOCO PRODUCTION COMPANY PLAT MAP

J u c a r l l l a / B / «2E Sec, 16-T26N-R05H Rio A r r i b a New Mexico

SCALE 1 IN , - 2,000 FT. JUL 14, 1995

1 ^ WELL L O C T iOK AND A CR E AGE DED1CA 7 P L A T < „ : : • • • • • : - . ; f

C ! ! f . - : : v t . - . - i l

A l l 6 i : « n c t ( t r . v f . \ r

s »r r u ' . f r bo-jr. (!»r; r » o ' the £ r c t : o x

Tenneco O i l Company J i c a r i l l a "B" v.

2E "_ ' r . j ; L c l i e i

J or.

16

7cv.-r.shiF

26N

r.crr.ge

5W

Ce-r.Jy

Rio A r r i b a A r : u ^ I FcDlage L o r

1640 =t»on c! Well:

ff-e: {rvzr. the S o u t h l ine end 1520 «^ ,•ht• East- l ine

. / : . . : : d L f v e ! E J e v ;

6609 Frccuclr . j Fonrz t lon

Dakota/Chacra Pool

Basin Dakota

XVdlccier j Arreoge:

- } ? n

1. Outline the acreege dedicated to l i e subject wel l by colored pencil or hachure marks OD the plat below.

2. I f more then one lease is dedicated to t ie v.el l , outline each and identify the ownership thereof (both es to working ie'erest end royalty).

3. If n.ore than one lease of different ownership is dedicated to the we l l , have the interests of al l owners been consoli­

dated by c p;nrr,uniti2ation, unitization, force-pooling, etc?

f | Yes [~__ No If answer is " y e s " type of consolidation

If answer is " n o l ' l is t the owners and tract descriptions which have actually been consolidated. (Use reverse side of this form if necessary.^ .

No allowable w i l l be assigned to the wel l until a l l interests have been consolidated (by communitization, unitization, forced-pooling, or otherwise) or unt i l a non-standard unit, eliminating such interests, has been approved by the Commis-s icn.

O 3 3 0 « 6 0 ' » 0 1 3 7 0 I t S C I D e O 2 3 1 C ~ £ A 0 1 5 0 0 1DOD

CERTIFICATION

/ hereby certify that f.Se information corn

lo/r-eo1 fierein Is frue ond complete tc fne

I'est of my lino*vfeo'y ond belief.

Nome

David Lane Posi t ion

Production Analyst Ccrr::. any

Tenneco O i l Company Dele

J u l y 17 , 1981

/ rierrfcy certify thai the welt focofion

sfio*vn on this plot wos plotted from field

notes of ocfuol surveys mode by me or

un_*er my supervision, ond* that the some

is true ond correct to the best of my

knowledge ond belief.

Dale Surveyed

Registered Profesr iona] En^lr.eer

and/or Lend Surveyor

CtrUi icc te No.

ADfW 022560

LIST OF ADDRESSES FOR OFFSET OPERATORS Jicarilla "B" Well #2E

Note: Amoco Production Company is the only offset operator in either formation.

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(LOW

ESTIMA TED BOTTOMHOLE PRESSURES BY FORMA TION JICARILLA B# 2E

CK Perforations at 4044-4126' midperf at 4085' DK Perforations at7326-7542' midperf at 7434'

11/88 shut in pressures — CK - 800 PSIG DK= 1160 PSIG

GRADIENT = 0.08 PSI/FT

CK BHP =800 PSIG + 4085' X 0.08 PSIG = 1127 PSIG

DK BHP = 1160 PSIG + 7434' X 0.08 PSIG =1755 PSIG

1127 PSIG / 1755 = 64% WHICH MEETS THE >50% RULE

STATE OF NEW MEXICO ENERGY and MINERALS DEPARTMENT

TM* fori* te sesf, lo to una tor f««enmg paeke* leakage IMI>

to SoulltMOl Man Meifco

OIL CONSERVATION DIVISION

NORTHWEST NEW MEXICO PACKER-LEAKAGE TEST

Pago 1 ROVIMCJ 10/01/78

TENNECO O I L CO. Operator _ Location T -, fi

of Well: Unit ° Sec. x o Twp. 26N

Lease

Rfc.

J I C A R I L L A B Well No.

2E N

5W County RIO ARRIBA

NAME OF P.ESIP.VOH1 OB POOL TYPE or • «oo.

(OM er a*ei MCTMOO OF PP.OO.

»\am at tn. un» PROO. MEDIUM

m a at C»g 1

CamalaUan WNDESIGMATEB CHACRA GAS FLOW TUBING

Cmmaiimiuii BASIN DAKOTA GAS i i FLOW TUBING

PRE-FLOW SHUT.IN PRESSURE DATA Hour, aalo tttui-m

Ccmpwwo' 2>30 pm 11 -07 -88

Lenottt a* ilnw trtul-m

72 hours i

01 praaa. peig

boo SUMUiad? (Taa ar No)

yes iMOUI. M l * tlHllHn

Com«*ciior.| 2 :30 pm 11 -07 -88

Length ef time ahul-Jn

72 hours

Ol praaa. petg

1160

OieMitied? (Yea at Nol

yes

FLOW TEST NO. 1 C w e n c r t al (hew. oalal* 1 0 - 0 0 am 1 1 - 1 0 - 8 8 Zero predMtnf (Upf •ratLcoer): l o w e r

TIME 9K»f. data)

LAPSED TIME HNCt*

pnusunt •woo. ZONE TtMP. -•

TIME 9K»f. data)

LAPSED TIME HNCt* Upvar Campteaoa laser Ceotpietien

•woo. ZONE TtMP. REMARK*

12:00 noon 1 1 - 1 1 - 8 8 26 h o u r s 800 455 10:30 am 1 1 - 1 2 - 8 8 46c5 hours 800 370 ,....., ..'"\ \~~* ri T>'» m

- ' ^ ^ i'S 0 IS ;nv li 1.

(pM • vnf.

Production rate during test

Oil: - BOPD based oo.

476

, Bbls. ia. .Horns.

Gas: MCFPD; Tested thru (Orifice cs Metes):

Gov.

meter

GOR.

MID-TEST SHUT-IN PRESSURE DATA Hour, date anul-M Langffi of pjuta oftuMn 01 proao. poatj Uatemcd? C n or Nol

CwpaeMcM

Hour. Salt ihwl-w length at umt ertvMn 01 praaa. pais, Suwmotf? (YM ar Not

(Continue cr® rwrne ridt) A WW 022088

JRTHWEST NIW MEXICO PACKER-LEAKAGE TEST Page 2

FLOW TEST NO. 2 ' * |ca<mn*neM i l Oaui. a a t e l * * Jane praa—tlaa lUpai

Teat Oour. caio)

\>~i£D TIMt U N C I * »

Mcuunr PP.OD. XOttl TBMP. MMARM

Teat Oour. caio)

\>~i£D TIMt U N C I * » Louet C&mpigikm

PP.OD. XOttl TBMP. MMARM

Production rate during test

Oil: ; BOPD based on Bbls. in Hours Grav GOR

Gas: MCFPD: Tested thm (Orifice or Meter):

Remarks:

I hcreby-ccrtify that the information herein contained is true and complete to the ben of my knowledge.

TENNECO O I L CO. Approved. ; j U' ) .„ i

>nservation Division 19 Operator

By DEBBIE WRIGHT

Title AGENT

Title PEW ci,.. GAS i^rKmii rasr. -m Date 11-18-88

NOBTHVZST NTT MEXICO PACKER ULAJCAG£ TEST INSTltUCTiOM

1. A pacha leakage a __D be a n t w d as each a—kjpiy completed well vie—a &-t~D day* after trtual conpictiso of the *dl. and aanu—)r iScrraho _ pnxaibrd by the order aiititta—iag dw muhiptc ccroplrusa Such ana dull afco be cMwcami aa «B aauluaet •anpinasn vnJua n n eav» feile«_f nrnrapW—HI andfe* chant—a) cf inc. ru.re a**o—tat. and «ber«rMtt mtdol *etk has facta aoat «o a orII during «——) the paean «f tubing ha— beeo disturbed. Ten o_8 aba be —ken at aay toa* dot co—» mMarraticn a Bjrpceud er when rrouoned br dkc Drnn—o.

2. At lean 7] noun prior to the —aniwaccasrat of aar •——cr in—age ten. th* opera—v ihaV notify the Division in anting ef the enact tint the est a o> be commenced 0—en opcraton thaiI aiao be ao aerified.

) Thr packer leakage test ah—i commcner •ben both sc—ea ef the dual cerapleuee art ihui-in tor prcsrurr aubiluation. Boili una thtil remain ahui-ia until dw well-head preuun tfi cub Ku rubilucd. provided hu»»,«j. thai they accd sot rtmaia shut-in men —tan at—rn days

4. Fo* Tkn> Tcsi No I. one JOCK of int dmj romplcuoo iWl be producrd ai uSr oorRuJ rate eef producuoe while the other IOOC fCTUUtftt thui-ia. Such tut dull be comi/iued fee seven dart m the cue of t tu well aod for 24 noun in the cue ef ao oil veil Netc: if. aa aa inn_J paean leakage tot. a gas well a being Rowed to the auBotphere due te the lack of a pipeline ronsKxuao ihe flow peine) dull be dure boun.

> Following raenplruon ef Flow Ten No I. the veil dull f i n be diut-ia. ia actor-—nee with Paragraph 3 above

A. Flo— Tcar'No. 2 duB be conducted even theugh as leak mt md_tcd during Fie* Ten No. I. Procedure for Flow Teat No. 2 a to be thr a—ne at far Flow Jem Na. I except

i—u dx preriouslr produced toa* —all r———9 abut-is while the sear —hich —sa prras_v-if draiHft a praduoad.

7. Praam fer (aa-aear am ana be oexsemi ea ea—r «d_i • 4-_v_ghi prcsurt gauga st war iMovab m Moaa: } baun ana: a__t_ai«l]r prior as the baps*. aeg of each /lew-period, at fjieen fftwrutr waraab dw—f the _ n hour then—f. aad at bo—rrf HMaraab tbaitaiVirf. ia—ad_s a—a paritMia nannansBflBI I—au—ifttly ai—t n _ta cooci—uon of each flea penad. f^a* t M : isune—aorf anar o the b*̂ r__—g of each flear pcriad. cf Iran aaa time duria| each flow period (at apfaoaiia—«ir the ratdoir point) and aaraed—irJr pnor w ihr eaiadiaian ef aadi fle— pcriad. 0—xr prranra ney be talea at desired, er raay be rcavcatcd en «e— vhich —ne prrtrio—»y ihown aaa> lierublc ten dia.

]4-heuf oil aaa* aaa: all preauna. duoufhoui thr catirc ten. _u0 be coaurHMUu> mcarufed aad recorded with recerdin| prenwr puf er thr accuracy of trhJcb m\ta be chrekrd at kraat nrarc. enrt ai rhe beginning and a n at lite rod of each era. with % deadweif hi prcaiwe gauge. If • «cS a a gtt-eS ar aa od-fu dual coispleuoa. the rererd-ing gauge duD be lectured ea die oil aoat only, ariih deadweight pre—urea zl rrq—red above being taken oa the gu aoat.

I. Thr roulu of the abovt-ekauihed teaa ihaJ be filed in oiplkau trfihin H dart arret toeapieuea of the int. Teas dull be fikrd anth the Aim Dnoiet O—xr ofthe Nr> Heajco Oil Conacrvatioa Dmuoa oo Hunlinji Nr— Mrairo Packer Leakage Teat form Krvbcd 1041-71 trid) all deadveight preaaures indicated thcrcoa at veil u the flowing oaaperarurei (gat ae—a only) and greeny and COR ,ail sc—ea oedy).

ADMN 022089

brie -IISS STATE OF NEW MEXICO 'II'

ENERGY, MINERALS and NATURAL R E ^ l ^ | S $ ( V I $ Q N ! S i 0

OIL CONSERVATION DIVISION " ' ° RE " i /CD AZTEC DISTRICT OFFICE

I1KUCK KING COVT.KNOK

Date:

ANITA LOCK WOOD OIIINI- .r .M.lHI- .IAHV

'95 SEy V W\ 3 RIO BHA/liS KOAl) AV.TIil?. NliWMI-Xli'ii "Mm <5U>) 3J4-611*

Oil Conservation Division P.O. Box 2088 Santa Fe, NM 87504-2088

RE: Proposed MC Proposed NSL_ Proposed WFX. Proposed NSP_

Proposed DHC ^ Proposed SWD. Proposed PMX. Proposed DD

Gentlemen:

I have examined the application received on_

for the OPERATOR LEASE & WELL NO.

_and my recommendations are as follows: UL-S-T-R