March 13, 1985

Shell Western E&P Inc. A Subsidiary of Shell Oil Company

P.O. Box 991

Houston, TX 77001

State of New Mexico Energy and Minerals Department Oil Conservation Division P. 0. Box 2088 Santa Fe, New Mexico 87501

Gentlemen:

SUBJECT: APPLICATION TO DOWNHOLE COMMINGLE SHELL - ARGO "A" NO. 11 1650' FNL AND 1650' FWL, UNIT LETTER "F" SECTION 22, T-21-S, R-37-E HARE SIMPSON & TUBB OIL AND GAS POOLS . LEA COUNTY, NEW MEXICO

Pursuant to the provision requests administrative a from the Hare Simpson and "A" No. 11 was drilled as back in 1966 and the well in commercial quantities, well remained temporarily after a cement squeeze of duced from the Tubb zone, of dual equipment cannot vention of waste, we now commingle with the Tubb 0

s of Rule 303-C, Shell Western E&P Inc. respectfully pproval to commingle production within the wellbore Tubb Oil And Gas Pools for the subject well. Argo a Brunson producer in 1952. The Brunson was plugged recompleted to the Paddock. After ceasing to produce the Paddock was temporarily abandoned in 1968. The abandoned until 1982 when i t recompleted to the Tubb the Paddock. Argo "A" No. 11 has since singly pro-With the indicated marginal production, installation

be justified. In the interest of conservation and pre-propose to recomplete to the Hare Simpson and downhole i l And Gas Pool in the subject well.

This well qualifies for administrative approval in accordance with Statewide Rule 303-C; and in support thereof, the following facts are submitted:

1. The attached plat indicates the Argo "A" lease.

2. The latest tests are as follows:

Tubb: (10-05-84) 4 BO + 0 BW + 146 MCFG

Hare Simpson: (3-05-85) 2 BO + 4 BW + 130 MCFG

3. Neither zone produces more water than the combined oil limit as deter­mined in Rule 303-C, Section 1, paragraph (1).

4. Shell Western E&P Inc. has commingled these fluids at the surface on the subject lease and has encountered no incompatibility problems; therefore, downhole commingling is not expected to result in reservoir damage.

5. Surface commingling resulted in no reduction of oil value; therefore, downhole commingling will not reduce oil value.

2

6. Ownership of the two pools to be commingled is common and correlative rights will not be violated.

7. The bottom-hole pressures at common datum of 7400' are: Tubb: 273 psig (48 hrs SI) Hare Simpson: 358 psig (48 hrs SI) We do not anticipate crossflow of fluids since the well will be main­tained at pumped off conditions.

8. Commingling will not jeopardize the efficiency of future secondary op­erations in either zone.

9. Recommended oil and gas allotments would be as follows:

Tubb Hare Simpson 67% Oil 33% 53% Gas 47%

10. Copies of this application have been furnished to all offset operators by certified mail.

Other supporting data attached are resume of the well's history, C-116 for each zone, a schematic of the present and proposed downhole configuration, and a production decline curve of the Tubb zone.

I f additional information is required, please advise.

Yours very truly,

A. J. Fore

Supervisor Regulatory and Permitting Production Administration Mid-Continent Division JMW

Attachments

cc: State of New Mexico Energy and Minerals Department Oil Conservation Division P. 0. Box 1980 Hobbs, New Mexico 88240

WELL HISTORY ARGO A #11

1/52 Drilled and completed in the Ellenburger formation.

6/66 Set CIBP over Ellenburger and recompleted in Paddock.

9/68 TA'd Paddock.

1/82 Squeezed Paddock and recompleted in Tubb.

1/85 Recompleted in Hare McKee and commingled w/Tubb. Installed artificial l i f t .

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OFFSET OPERATORS

SHELL - ARGO "A" LEASE

SUN EXPLORATION AND PRODUCTION COMPANY P.O. BOX 2880 DALLAS, TEXAS 75221-2880

J.R. CONE P.O. BOX 10217 LUBBOCK, TEXAS 79408

GULF EXPLORATION AND PRODUCTION COMPANY P.O. BOX 670 HOBBS, NEW MEXICO 88240

MARATHON OIL COMPANY P.O. BOX 2409 HOBBS, NEW MEXICO 88240

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. — S T A T E OF NEW MEXICO

l l t f l ENERGY AND MINERALS DEPARTMENT " V OIL CONSERVATION DIVISION

HOBBS DISTRICT OFFICE March 19, 1985

TONEY ANAYA POST OFFICE BOX 19BO GOVERNOR HOBBS, NEW MEXICO 88240

(505) 393-6161

OIL CONSERVATION DIVISION P. 0. BOX 2088 SANTA FE, NEW MEXICO 87501

RE: Proposed: MC DHC X NSL NSP SWD WFX PMX

Gentlemen:

I have examined the application for the:

Shell Western E&P Inc. Argo #11-F 22-21-37 Operator Lease & Well No. Unit S-T-R

and my recommendations are as follows:

O.K. —J.S.